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Investment Objective and Policies — Investments in the Subsidiary” is amended to","page_number":13,"box":{"x":116,"y":87,"width":767,"height":12}},{"id":"4e1ac2c2-b8dc-416a-b5f8-3bed267f9e9d","block_type":"box","text":"add the following:","page_number":13,"box":{"x":116,"y":103,"width":134,"height":12}},{"id":"a719181f-1b70-4097-b33d-059708015b09","block_type":"box","text":"Investments in the Subsidiary — BlackRock Cayman Managed Volatility V.I. Fund, Ltd.","page_number":13,"box":{"x":116,"y":134,"width":643,"height":12}},{"id":"ed790da7-3b94-442c-a6b8-c96fe3db19d0","block_type":"box","text":"BlackRock Managed Volatility V.I. Fund may invest up to 25% of its total assets in the shares of its wholly-owned and","page_number":13,"box":{"x":116,"y":165,"width":769,"height":12}},{"id":"17d4c9d1-6277-4427-aaf5-250901479894","block_type":"box","text":"controlled Managed Volatility Subsidiary. Investments in th","page_number":13,"box":{"x":116,"y":181,"width":385,"height":11}},{"id":"5763d159-4891-4e96-9c54-f2b0921d1b78","block_type":"box","text":"e Managed Volatility Subsidiary are expected to provide","page_number":13,"box":{"x":502,"y":181,"width":366,"height":11}},{"id":"50d79cc0-4f86-47a8-9d38-5ca5eed8e687","block_type":"box","text":"the BlackRock Managed Volatility V.I. Fund with exposur","page_number":13,"box":{"x":116,"y":196,"width":378,"height":12}},{"id":"50502955-8c83-4b5e-9019-f22c6606fd2d","block_type":"box","text":"e to the commodity markets within the limitations of","page_number":13,"box":{"x":494,"y":196,"width":342,"height":12}},{"id":"382aca3f-07e3-4e89-92f9-859ff65a3584","block_type":"box","text":"Subchapter M of the Internal Revenue Code of 1986. The Subsidiary is advised by the Manager. The Managed","page_number":13,"box":{"x":116,"y":212,"width":716,"height":11}},{"id":"1d215bf8-13bf-4eff-9c17-56194514e7d5","block_type":"box","text":"Volatility Subsidiary (unlike BlackRock Managed Volatility V","page_number":13,"box":{"x":116,"y":227,"width":392,"height":12}},{"id":"63a2b201-5dfe-4836-bdab-5dcd410b758f","block_type":"box","text":"V.I. Fund) may invest without limitation in commodity","page_number":13,"box":{"x":508,"y":227,"width":359,"height":12}},{"id":"9d1009e3-73ce-4da5-a7e1-ddaf8c96accb","block_type":"box","text":"related instruments. However, the Managed Volatility Subsidiary is otherwise subject to the same fundamental,","page_number":13,"box":{"x":116,"y":243,"width":718,"height":11}},{"id":"28602b2e-376c-4bda-b651-13ed6022b736","block_type":"box","text":"non-fundamental and certain other investment restrictions as the BlackRock Managed Volatility V.I. Fund, including","page_number":13,"box":{"x":116,"y":258,"width":755,"height":12}},{"id":"faab6647-914b-40e9-8021-b293dbddbff1","block_type":"box","text":"the timing and method of the valuation of the Managed Volatility Subsidiary’s portfolio investments and shares of the","page_number":13,"box":{"x":116,"y":274,"width":760,"height":11}},{"id":"4b076619-f80e-449a-94da-64440c849e5e","block_type":"box","text":"Managed Volatility Subsidiary. The Managed Volatility Subsid","page_number":13,"box":{"x":116,"y":289,"width":408,"height":12}},{"id":"ba2fcc01-6bf8-4f36-bfd9-8005eb53e97a","block_type":"box","text":"iary is managed pursuant to compliance policies and","page_number":13,"box":{"x":524,"y":289,"width":341,"height":12}},{"id":"96d22226-a489-4d6d-9630-29d3c20cd8d8","block_type":"box","text":"procedures that are the same, in all material respects, as the policies and procedures adopted by BlackRock Managed","page_number":13,"box":{"x":116,"y":305,"width":753,"height":11}},{"id":"33d896a3-f342-489d-8434-bedcbd8c9c3e","block_type":"box","text":"Volatility V.I Fund. The Managed Volatility Subsidiary is a company organized under the laws of the Cayman Islands,","page_number":13,"box":{"x":116,"y":320,"width":768,"height":12}},{"id":"bca8de27-42fe-4b0b-80c3-d47895f57b28","block_type":"box","text":"and is overseen by its own board of directors, which is","page_number":13,"box":{"x":116,"y":336,"width":353,"height":11}},{"id":"64c5e9aa-e962-4ed5-b487-2544f722b095","block_type":"box","text":"comprised of John M. Perlowski, a Trustee, President and","page_number":13,"box":{"x":469,"y":336,"width":375,"height":11}},{"id":"94950b64-b028-42a2-920e-4094f82c9a0b","block_type":"box","text":"Chief Executive Officer of BlackRock Managed Volatility V.I Fund, and Trent Walker, Chief Financial Officer of","page_number":13,"box":{"x":116,"y":351,"width":738,"height":12}},{"id":"6475d2d8-c8e9-48a3-b43b-05cf2be9d91f","block_type":"box","text":"BlackRock Managed Volatility V.I Fund. BlackRock Managed Volatility V.I Fund is the sole shareholder of the","page_number":13,"box":{"x":116,"y":367,"width":725,"height":11}},{"id":"0e74bf7a-7275-4537-ae84-6c857f3f3827","block_type":"box","text":"Managed Volatility Subsidiary, and shares of the Managed Vola","page_number":13,"box":{"x":116,"y":382,"width":413,"height":12}},{"id":"4e245441-1b68-4889-bc89-b85c11555e86","block_type":"box","text":"tility Subsidiary will not be sold or offered to other","page_number":13,"box":{"x":529,"y":382,"width":331,"height":12}},{"id":"6abc1dd0-51ad-4450-9a1e-7f30a5957901","block_type":"box","text":"investors.","page_number":13,"box":{"x":116,"y":398,"width":66,"height":9}},{"id":"a0eb6419-b5fa-4c63-ba9e-90337926574a","block_type":"box","text":"The Managed Volatility Subsidiary invests primarily in commodity-related instruments. Although","page_number":13,"box":{"x":116,"y":429,"width":665,"height":11}},{"id":"6262e2f3-ac9d-45bd-84b2-a888dfbd4e58","block_type":"box","text":"BlackRock Managed Volatility V.I Fund may invest in these commodity-related instruments directly,","page_number":13,"box":{"x":116,"y":444,"width":689,"height":12}},{"id":"e4aa65cf-abd8-4c82-aa1d-f90d6db8bcee","block_type":"box","text":"BlackRock Managed Volatility V.I Fund will likely gain exposure to these commodity-related instruments","page_number":13,"box":{"x":116,"y":460,"width":723,"height":11}},{"id":"0fa33242-f6f6-44e3-bffe-0a6053917a2f","block_type":"box","text":"indirectly by investing in the Managed Volatility Subsidiary. To the extent that BlackRock believes that these","page_number":13,"box":{"x":116,"y":475,"width":744,"height":12}},{"id":"750836c6-9be7-42d3-ae47-42e16f569359","block_type":"box","text":"commodity-related instruments provide suitable exposure to the commodities market, BlackRock Managed","page_number":13,"box":{"x":116,"y":491,"width":728,"height":11}},{"id":"a9abbacf-d4e6-464c-ad4a-5e0dc8d5f49b","block_type":"box","text":"Volatility V.I Fund’s investment in the Managed Volatility Subsidiary will likely increase. The Managed","page_number":13,"box":{"x":116,"y":506,"width":713,"height":12}},{"id":"91b4488f-4f47-4f7e-a15b-a110e41c75fc","block_type":"box","text":"Volatility Subsidiary may also hold cash and invest in other instruments, including fixed income securities, either","page_number":13,"box":{"x":116,"y":522,"width":770,"height":11}},{"id":"c2147de7-f091-4e5f-86bd-ad07433fd4fb","block_type":"box","text":"as investments or to serve as margin or collateral for the Managed Volatility Subsidiary’s derivative positions.","page_number":13,"box":{"x":116,"y":537,"width":748,"height":12}},{"id":"eca537ec-2a6f-4d75-b6ea-f787a6fd7ce9","block_type":"box","text":"The Manager manages the assets of the Managed Volatility Subsidiary pursuant to a separate investment","page_number":13,"box":{"x":116,"y":568,"width":710,"height":12}},{"id":"d60ec76d-6fd8-4ea4-a641-b5476c858058","block_type":"box","text":"management agreement (the “Subsidiary Management Agreement”), but receives no additional compensation for","page_number":13,"box":{"x":116,"y":584,"width":767,"height":11}},{"id":"3d4f822a-f424-412d-ad62-7385dec19285","block_type":"box","text":"doing so. The Manager has entered into sub-advisory agreements with BlackRock International Limited (“BIL”),","page_number":13,"box":{"x":116,"y":599,"width":767,"height":12}},{"id":"f8d95540-681e-4561-98da-0a7b0d34e346","block_type":"box","text":"BlackRock Asset Management North Asia Limited (“BAMNAL”) and BlackRock (Singapore) Limited (“BSL”","page_number":13,"box":{"x":116,"y":615,"width":757,"height":11}},{"id":"37e92f07-f175-421b-adba-827bb489654a","block_type":"box","text":"and together with BIL and BAMNAL, the “Sub-Advisers”) with respect to the Managed Volatility Subsidiary.","page_number":13,"box":{"x":116,"y":630,"width":749,"height":12}},{"id":"526145b9-e926-4581-be35-7b989ffe6c43","block_type":"box","text":"BlackRock also provides certain administrative services for the Managed Volatility Subsidiary, but receives no","page_number":13,"box":{"x":116,"y":646,"width":753,"height":11}},{"id":"30bf9294-f887-40ee-8cda-bbb97dcf6985","block_type":"box","text":"additional compensation for doing so. The Managed Volatility Subsidiary will also enter into separate contracts","page_number":13,"box":{"x":116,"y":661,"width":752,"height":12}},{"id":"85bcc1a5-9156-437d-ace8-7bb7762e5957","block_type":"box","text":"for the provision of custody, accounting agent and audit services with the same or with affiliates of the same","page_number":13,"box":{"x":116,"y":677,"width":731,"height":11}},{"id":"b54e10c8-b2b9-4489-a4fe-e0dc0676d582","block_type":"box","text":"service providers that provide those services to BlackRock Managed Volatility V.I Fund.","page_number":13,"box":{"x":117,"y":692,"width":598,"height":12}},{"id":"4aead01c-4501-4e3c-ab8d-e07961a2e2b4","block_type":"box","text":"The financial statements of the Managed Volatility Subsidiary will be consolidated with BlackRock Managed","page_number":13,"box":{"x":116,"y":723,"width":740,"height":12}},{"id":"14e61627-11d8-4955-b57f-a20c0dda7514","block_type":"box","text":"Volatility V.I Fund’s financial statements in BlackRock Managed Volatility V.I Fund’s annual and semi-annual","page_number":13,"box":{"x":116,"y":739,"width":754,"height":11}},{"id":"30323dde-36a4-4aea-8865-2b46231e31b1","block_type":"box","text":"reports. BlackRock Managed Volatility V.I Fund’s Annual and Semi-Annual Financial Statements and","page_number":13,"box":{"x":116,"y":754,"width":693,"height":12}},{"id":"5e61d277-e072-47b6-bb7e-25f86006901e","block_type":"box","text":"Additional Information are filed with the SEC on Form N-CSR and are provided without charge upon request as","page_number":13,"box":{"x":116,"y":770,"width":757,"height":11}},{"id":"43fb92db-c317-414f-acc8-8502b9eb118c","block_type":"box","text":"indicated on the front cover of this SAI.","page_number":13,"box":{"x":116,"y":785,"width":267,"height":9}},{"id":"7e6450aa-56f0-4a61-ba55-f3944fc5eaf6","block_type":"box","text":"The Managed Volatility Subsidiary is not registered under the Investment Company Act, and, unless otherwise","page_number":13,"box":{"x":116,"y":816,"width":748,"height":12}},{"id":"045b3de7-3bb1-4108-b7da-65d5e4fa39b2","block_type":"box","text":"noted in BlackRock Managed Volatility V.I Fund’s prospectus or this SAI, is not subject to all the investor","page_number":13,"box":{"x":116,"y":832,"width":725,"height":11}},{"id":"9ebd8582-295a-4e6b-9104-9b2dc3fb1304","block_type":"box","text":"protections of the Investment Company Act. However, BlackRock Managed Volatility V.I Fund wholly owns","page_number":13,"box":{"x":116,"y":847,"width":744,"height":12}},{"id":"e17eaa55-6306-4bb5-9fa6-4ff58309d052","block_type":"box","text":"and controls the Managed Volatility Subsidiary, and BlackRock Managed Volatility V.I Fund and the Managed","page_number":13,"box":{"x":116,"y":863,"width":757,"height":11}},{"id":"97ded680-577d-4b07-acf6-e7254c30975c","block_type":"box","text":"Volatility Subsidiary are both managed by BlackRock, making it unlikely that the Managed Volatility Subsidiary","page_number":13,"box":{"x":116,"y":878,"width":768,"height":12}},{"id":"6f5de915-8577-4447-986d-3179a669e9b7","block_type":"box","text":"will take action contrary to the interests of BlackRock Managed Volatility V.I Fund and its shareholders.","page_number":13,"box":{"x":116,"y":894,"width":711,"height":11}},{"id":"9ca7a3c3-43be-4b2e-9d57-34f6b90351df","block_type":"box","text":"BlackRock Managed Volatility V.I Fund’s Board of Trustees has oversight responsibility for the investment","page_number":13,"box":{"x":116,"y":909,"width":729,"height":12}},{"id":"b0e16692-6fd0-42f7-8b06-dcb29959e760","block_type":"box","text":"NM1026U-6004382-13/605","page_number":13,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"c92b737d-33a2-4e0a-a806-856c63ea64ff","block_type":"box","text":"activities of BlackRock Managed Volatility V.I Fund, including BlackRock Managed Volatility V.I Fund’s","page_number":14,"box":{"x":116,"y":88,"width":727,"height":11}},{"id":"bbc4f324-da0d-4c32-8be9-98af2d031734","block_type":"box","text":"investment in the Managed Volatility Subsidiary, and BlackRock Managed Volatility V.I Fund’s role as sole","page_number":14,"box":{"x":116,"y":103,"width":737,"height":12}},{"id":"5647fbb4-7f80-4562-a88c-c509c4fb7ce2","block_type":"box","text":"shareholder of the Managed Volatility Subsidiary. As noted above, the Managed Volatility Subsidiary will be","page_number":14,"box":{"x":117,"y":119,"width":742,"height":11}},{"id":"7c54b2c5-f4db-4136-9372-6286f465fbe1","block_type":"box","text":"subject to the same investment restrictions and limitations as the BlackRock Managed Volatility V.I. Fund.","page_number":14,"box":{"x":117,"y":134,"width":726,"height":12}},{"id":"90a1871a-ef54-4be4-9938-86d4cf995539","block_type":"box","text":"The Managed Volatility Subsidiary is managed pursuant to compliance policies and procedures that are the same,","page_number":14,"box":{"x":116,"y":165,"width":770,"height":12}},{"id":"25e86d58-9adb-423e-97fb-f39aea50c1df","block_type":"box","text":"in all material respects, as the policies and procedures adopted by the BlackRock Managed Volatility V.I. Fund.","page_number":14,"box":{"x":116,"y":181,"width":759,"height":11}},{"id":"f46f7820-84ab-4a55-82b7-04794761732e","block_type":"box","text":"In addition, changes in the laws of the United States and/or the Cayman Islands could result in the inability of the","page_number":14,"box":{"x":116,"y":196,"width":769,"height":12}},{"id":"998de00d-9244-4000-9e4f-e65628e48964","block_type":"box","text":"BlackRock Managed Volatility V.I. Fund and/or the Managed Volatility Subsidiary to operate as described in the","page_number":14,"box":{"x":116,"y":212,"width":769,"height":11}},{"id":"9489a923-db29-4afe-9771-68a944c4f04b","block_type":"box","text":"BlackRock Managed Volatility V.I. Fund’s prospectus and this SAI and could adversely affect BlackRock","page_number":14,"box":{"x":116,"y":227,"width":722,"height":12}},{"id":"5a05f9a5-433a-4f44-9039-1b10241242d5","block_type":"box","text":"Managed Volatility V.I Fund. For example, the Cayman Islands does not currently impose any income, corporate","page_number":14,"box":{"x":116,"y":243,"width":768,"height":11}},{"id":"813e1224-ccdc-4e08-a598-bea3802d5b36","block_type":"box","text":"or capital gains tax, estate duty, inheritance tax, gift tax or withholding tax on the Managed Volatility Subsidiary.","page_number":14,"box":{"x":116,"y":258,"width":769,"height":12}},{"id":"70e2fdba-448b-444e-959a-f49452234660","block_type":"box","text":"If Cayman Islands law changes such that the Managed Volatility Subsidiary must pay Cayman Islands taxes,","page_number":14,"box":{"x":116,"y":274,"width":737,"height":11}},{"id":"f0ccd8ac-5f06-4a1b-994d-e1623badb716","block_type":"box","text":"shareholders of BlackRock Managed Volatility V.I. Fund would likely suffer decreased investment returns.","page_number":14,"box":{"x":117,"y":289,"width":727,"height":12}},{"id":"a86dcaa7-544e-4563-bbd4-349bc18e2c03","block_type":"box","text":"The Managed Volatility Subsidiary itself is not expected to be subject to U.S. federal income tax. The Managed","page_number":14,"box":{"x":116,"y":320,"width":758,"height":12}},{"id":"bfa7f3ca-8d1e-41e3-b071-4e1b54224997","block_type":"box","text":"Volatility Subsidiary will, however, be considered a controlled foreign corporation, and BlackRock Managed","page_number":14,"box":{"x":116,"y":336,"width":741,"height":11}},{"id":"d4f6cf37-9972-4a44-8622-ce4769bf7c67","block_type":"box","text":"Volatility V.I. Fund will be required to include as income annually amounts earned by the Managed Volatility","page_number":14,"box":{"x":116,"y":351,"width":747,"height":12}},{"id":"34420b78-8f88-485d-9584-e5ab196ad194","block_type":"box","text":"Subsidiary during that year, whether or not the Managed Volatility Subsidiary distributes such amounts to the","page_number":14,"box":{"x":116,"y":367,"width":744,"height":11}},{"id":"b3c0cc18-71ea-4954-85b7-082f7f75e9dc","block_type":"box","text":"BlackRock Managed Volatility V.I. Fund. Gains from the sales of investments by the Managed Volatility","page_number":14,"box":{"x":116,"y":382,"width":715,"height":12}},{"id":"754adb33-3c6a-4978-85d9-a0e1e57b5cbd","block_type":"box","text":"Subsidiary will not be eligible for capital gains treatment but instead will be treated as ordinary income when","page_number":14,"box":{"x":116,"y":398,"width":741,"height":11}},{"id":"0f306638-cebe-411f-a5e8-5008f6989bbf","block_type":"box","text":"included in income by the BlackRock Managed Volatility V.I. Fund. Furthermore, the requirement for the","page_number":14,"box":{"x":116,"y":413,"width":719,"height":12}},{"id":"1fd3d60a-dd9f-446c-bd89-10a2f189ae9c","block_type":"box","text":"BlackRock Managed Volatility V.I. Fund to distribute net investment income, if any, and net realized capital","page_number":14,"box":{"x":116,"y":429,"width":738,"height":11}},{"id":"e4ba40cf-9291-4958-aa5f-553e8f4126c9","block_type":"box","text":"gain, if any, at least annually will apply to such Managed Volatility Subsidiary income, whether or not the","page_number":14,"box":{"x":116,"y":444,"width":720,"height":12}},{"id":"ed74d65a-0558-44cd-84e1-133c8dcbb38b","block_type":"box","text":"Managed Volatility Subsidiary makes a distribution to the BlackRock Managed Volatility V.I. Fund during the","page_number":14,"box":{"x":116,"y":460,"width":752,"height":11}},{"id":"d5610c23-e026-47bf-8fc4-db592992dbca","block_type":"box","text":"taxable year. If the Managed Volatility Subsidiary incurs net losses in any year, such losses will not offset the","page_number":14,"box":{"x":116,"y":475,"width":744,"height":12}},{"id":"e715d51c-2b5c-4d94-af5e-a2c887383380","block_type":"box","text":"BlackRock Managed Volatility V.I. Fund’s income or gains nor carryforward to future years.","page_number":14,"box":{"x":116,"y":491,"width":633,"height":11}},{"id":"e97d3f83-f8d0-4db6-8e58-56e21c430451","block_type":"box","text":"The section entitled “II. Investment Restrictions - Restrictions Applicable to each of the Funds (Except","page_number":14,"box":{"x":116,"y":522,"width":740,"height":11}},{"id":"4f665252-8ab6-480b-adc3-15c6c7b83bc4","block_type":"box","text":"BlackRock 60/40 Target Allocation ETF V.I. Fund, BlackRock Government Money Market V.I. Fund,","page_number":14,"box":{"x":116,"y":537,"width":739,"height":12}},{"id":"22a1bd29-abc5-494d-82a0-5c71e51352a1","block_type":"box","text":"BlackRock International Index V.I. Fund and BlackRock Small Cap Index V.I. Fund)” is amended to add","page_number":14,"box":{"x":116,"y":553,"width":763,"height":11}},{"id":"f58ee63d-0e04-4e6e-8f42-f7cbb5f304d8","block_type":"box","text":"the following:","page_number":14,"box":{"x":116,"y":568,"width":103,"height":12}},{"id":"479c8162-647e-4e99-a44e-0d133f42cd44","block_type":"box","text":"The Managed Volatility Subsidiary will follow BlackRock Managed Volatility V.I. Fund’s fundamental and","page_number":14,"box":{"x":116,"y":599,"width":734,"height":12}},{"id":"d611d7e1-be39-4606-835e-d2f6f766c5ec","block_type":"box","text":"non-fundamental investment restrictions, described above, with respect to its investments.","page_number":14,"box":{"x":116,"y":615,"width":611,"height":11}},{"id":"6e50f482-5158-4ac5-a690-d19549de209e","block_type":"box","text":"The title of the subsection entitled “IV. Management, Advisory and Other Service Arrangements —","page_number":14,"box":{"x":116,"y":646,"width":720,"height":11}},{"id":"d47e9ed8-cb0c-49e8-a3db-d7d60da1599d","block_type":"box","text":"Organization and Management of Wholly-Owned Subsidiary” is deleted in its entirety and replaced with","page_number":14,"box":{"x":116,"y":661,"width":752,"height":12}},{"id":"fa884ed8-3939-40dd-82a2-12256f23ab25","block_type":"box","text":"the following: “IV. Management, Advisory and Other Service Arrangements — Organization and","page_number":14,"box":{"x":116,"y":677,"width":702,"height":11}},{"id":"ee9a51ca-54d5-44d6-9035-48250ef9fbc3","block_type":"box","text":"Management of Wholly-Owned Subsidiary — BlackRock Global Allocation V.I. Fund”","page_number":14,"box":{"x":116,"y":692,"width":625,"height":12}},{"id":"ce4c6404-6ab8-4be5-85ac-39477f3ab9be","block_type":"box","text":"The section entitled “IV. Management, Advisory and Other Service Arrangements” is amended to add the","page_number":14,"box":{"x":116,"y":723,"width":761,"height":12}},{"id":"0503fa2d-6788-4a67-8cc5-d4471e3b56d5","block_type":"box","text":"following:","page_number":14,"box":{"x":116,"y":739,"width":70,"height":11}},{"id":"dde5d298-e06b-40fe-b8e6-240ca45b2990","block_type":"box","text":"Organization and Management of Wholly-Owned Subsidiary — BlackRock Managed Volatility V.I. Fund","page_number":14,"box":{"x":116,"y":770,"width":760,"height":11}},{"id":"860fd5af-4bba-4f97-87ce-38ffb9b02ccf","block_type":"box","text":"BlackRock Managed Volatility V.I. Fund intends to gain exposure to commodity markets by investing up to 25%","page_number":14,"box":{"x":116,"y":801,"width":764,"height":11}},{"id":"345cfdc4-cb7a-473c-b0f2-a29b5f28948a","block_type":"box","text":"of its total assets in the Managed Volatility Subsidiary. The Managed Volatility Subsidiary invests primarily in","page_number":14,"box":{"x":116,"y":816,"width":748,"height":12}},{"id":"09235f69-c734-4b4f-b471-af11864e8b1e","block_type":"box","text":"commodity-related instruments.","page_number":14,"box":{"x":116,"y":832,"width":219,"height":11}},{"id":"f5467464-6b3c-45e2-8350-ee2cdb57e84f","block_type":"box","text":"The Managed Volatility Subsidiary is a company organized under the laws of the Cayman Islands, whose","page_number":14,"box":{"x":116,"y":863,"width":716,"height":11}},{"id":"630b2097-4372-4314-b01e-f822fe84bc26","block_type":"box","text":"registered office is located at the offices of Maples Corporate Services Limited, P.O. Box 309, Ugland House,","page_number":14,"box":{"x":116,"y":878,"width":746,"height":12}},{"id":"1553cfba-ddcd-4dd4-baf0-09eb58e78c6c","block_type":"box","text":"Grand Cayman KYI-1104, Cayman Islands. The Subsidiary’s affairs are overseen by a board of directors, which","page_number":14,"box":{"x":116,"y":894,"width":762,"height":11}},{"id":"3af1e47f-bbfb-48ca-b3df-fc9e8235f015","block_type":"box","text":"is comprised of John M. Perlowski and Trent Walker.","page_number":14,"box":{"x":116,"y":909,"width":361,"height":12}},{"id":"1c9e5fb3-c2f7-47ea-9aa6-4aa9ea7de99b","block_type":"box","text":"NM1026U-6004382-14/605","page_number":14,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"068ed6f4-b7cd-4c64-9c95-d0aff4ce7865","block_type":"box","text":"The Manager provides investment management and administrative services to the Managed Volatility","page_number":15,"box":{"x":116,"y":88,"width":691,"height":11}},{"id":"c1f73099-0f34-4852-bf2e-a31b1505bcfe","block_type":"box","text":"Subsidiary. The Manager does not receive separate compensation from the Managed Volatility Subsidiary for","page_number":15,"box":{"x":116,"y":103,"width":744,"height":12}},{"id":"b9e0308e-31d1-429e-b25f-7fb28b5beca0","block_type":"box","text":"providing it with investment advisory or administrative services. However, BlackRock Managed Volatility V.I.","page_number":15,"box":{"x":116,"y":119,"width":755,"height":11}},{"id":"71be1190-b00c-40b7-9862-b51d70b3b9f3","block_type":"box","text":"Fund pays the Manager based on BlackRock Managed Volatility V.I. Fund’s assets, including the assets invested","page_number":15,"box":{"x":116,"y":134,"width":767,"height":12}},{"id":"b5c44702-cb6f-43f8-8654-93cfa423fc92","block_type":"box","text":"in the Managed Volatility Subsidiary. BlackRock has entered into sub-advisory agreements with each of","page_number":15,"box":{"x":116,"y":150,"width":708,"height":11}},{"id":"8e195ee0-d8dd-4be0-9a1e-fbdc0f74ccc9","block_type":"box","text":"BlackRock International Limited, BlackRock Asset Management North Asia Limited and BlackRock","page_number":15,"box":{"x":116,"y":165,"width":688,"height":12}},{"id":"11a6dcbb-161d-47c4-af2c-8ab693ae7702","block_type":"box","text":"(Singapore) Limited with respect to the Managed Volatility Subsidiary. The Managed Volatility Subsidiary","page_number":15,"box":{"x":116,"y":181,"width":728,"height":11}},{"id":"44906604-2626-4857-9532-722263d3f17f","block_type":"box","text":"entered into contracts for the provision of custody, accounting agent and audit services with the same service","page_number":15,"box":{"x":116,"y":196,"width":739,"height":12}},{"id":"4fc756a3-965e-40cf-b98f-c3cdf881c84b","block_type":"box","text":"providers that provide those services to BlackRock Managed Volatility V.I. Fund.","page_number":15,"box":{"x":116,"y":212,"width":557,"height":11}},{"id":"0da45620-78fd-444d-b210-403eb8fa1b2e","block_type":"box","text":"The Managed Volatility Subsidiary is managed pursuant to compliance policies and procedures that are the same,","page_number":15,"box":{"x":116,"y":243,"width":770,"height":11}},{"id":"0b1e7e23-2b9b-4d97-ab59-27e181d90e63","block_type":"box","text":"in all material respects, as the policies and procedures adopted by BlackRock Managed Volatility V.I. Fund. As a","page_number":15,"box":{"x":116,"y":258,"width":769,"height":12}},{"id":"77ffe97d-6052-4987-b842-592b4eea3975","block_type":"box","text":"result, the Manager, in managing the Managed Volatility Subsidiary’s portfolio, is subject to the same investment","page_number":15,"box":{"x":116,"y":274,"width":770,"height":11}},{"id":"1c0745ac-8573-4682-9fd0-040557dc6d3d","block_type":"box","text":"policies and restrictions that apply to the management of BlackRock Managed Volatility V.I. Fund, and, in","page_number":15,"box":{"x":116,"y":289,"width":725,"height":12}},{"id":"5afa627f-df7d-4264-900c-66becea4e05d","block_type":"box","text":"particular, to the requirements relating to portfolio leverage, liquidity, brokerage, and the timing and method of","page_number":15,"box":{"x":116,"y":305,"width":754,"height":11}},{"id":"19659311-5689-4299-81b5-341da6282412","block_type":"box","text":"the valuation of the Managed Volatility Subsidiary’s portfolio investments and shares of the Managed Volatility","page_number":15,"box":{"x":116,"y":320,"width":761,"height":12}},{"id":"1c54f6fd-1bfc-49f1-8145-b76c3c00b98f","block_type":"box","text":"Subsidiary. These policies and restrictions are described elsewhere in detail in this SAI. BlackRock Managed","page_number":15,"box":{"x":116,"y":336,"width":741,"height":11}},{"id":"b60c618b-c257-4ed0-b10f-3713f3d71f85","block_type":"box","text":"Volatility V.I Fund and the Managed Volatility Subsidiary test for compliance with certain investment","page_number":15,"box":{"x":116,"y":351,"width":695,"height":12}},{"id":"d52d30a8-2756-48f1-bfdb-6e6d72a85c8e","block_type":"box","text":"restrictions on a consolidated basis.","page_number":15,"box":{"x":116,"y":367,"width":243,"height":9}},{"id":"77973fae-2e7e-4dfd-8ad8-a2880c89fe75","block_type":"box","text":"The section entitled “VI. Computation of Offering Price Per Share” is deleted in its entirety and replaced","page_number":15,"box":{"x":116,"y":398,"width":758,"height":11}},{"id":"b4037962-5e07-4eba-8e8e-d2b0d3de03bc","block_type":"box","text":"with the following:","page_number":15,"box":{"x":116,"y":413,"width":139,"height":12}},{"id":"d452f821-14d4-4725-a1d2-1d2eebd4fa62","block_type":"box","text":"The offering price for each Fund’s shares is equal to the net asset value computed by dividing the value of the","page_number":15,"box":{"x":116,"y":444,"width":745,"height":12}},{"id":"03613e2f-4f4f-4c7d-a89d-642817b0f9b9","block_type":"box","text":"Fund’s net assets by the number of shares outstanding. For more information on the purchasing and valuation of","page_number":15,"box":{"x":116,"y":460,"width":761,"height":11}},{"id":"a583391c-e365-4b3a-af0b-8fa04a07a238","block_type":"box","text":"shares, please see “Purchase of Shares” and “Pricing of Shares” in Part II of this SAI. Each of the Global","page_number":15,"box":{"x":117,"y":475,"width":710,"height":12}},{"id":"c5c573ae-9f36-4ab0-816e-a50c8e2dfd75","block_type":"box","text":"Allocation Subsidiary and the Managed Volatility Subsidiary is subject to the same valuation policies as","page_number":15,"box":{"x":116,"y":491,"width":708,"height":11}},{"id":"ceb92c67-a281-4e8d-aec5-732b9a100692","block_type":"box","text":"BlackRock Global Allocation V.I. Fund and BlackRock Managed Volatility V.I. Fund, as applicable, as","page_number":15,"box":{"x":116,"y":506,"width":705,"height":12}},{"id":"e014c102-dce1-4b67-b266-614e401b934e","block_type":"box","text":"described in “Pricing of Shares” in Part II of this SAI. BlackRock Global Allocation V.I. Fund’s investment in","page_number":15,"box":{"x":116,"y":522,"width":749,"height":11}},{"id":"6007a3ad-9c90-4b4c-bec2-5245dfec9d31","block_type":"box","text":"the Global Allocation Subsidiary and BlackRock Managed Volatility V.I. Fund’s investments in the Managed","page_number":15,"box":{"x":116,"y":537,"width":745,"height":12}},{"id":"fa72dc22-6a52-4b94-bb88-2e6f30c7a00e","block_type":"box","text":"Volatility Subsidiary are valued based on the value of the applicable subsidiary’s portfolio investments. Each of","page_number":15,"box":{"x":116,"y":553,"width":759,"height":11}},{"id":"c69bc202-39f6-4a20-a804-b6b67a2f12f8","block_type":"box","text":"the Global Allocation Subsidiary and the Managed Volatility Subsidiary prices its portfolio investments pursuant","page_number":15,"box":{"x":116,"y":568,"width":767,"height":12}},{"id":"67806ec2-424a-4bfa-a884-136d0ed39e9b","block_type":"box","text":"to the same pricing and valuation methodologies and procedures used by BlackRock Global Allocation V.I. Fund","page_number":15,"box":{"x":116,"y":584,"width":768,"height":11}},{"id":"8f55ce4d-bced-4ca3-a94f-e8666b1d9642","block_type":"box","text":"and BlackRock Managed Volatility V.I. Fund, as applicable, which require, among other things, that the","page_number":15,"box":{"x":116,"y":599,"width":707,"height":12}},{"id":"f1870e7c-4894-4cf0-aa78-837980b68b22","block_type":"box","text":"subsidiary’s portfolio investments be marked-to-market (that is, the value on the subsidiary’s books changes)","page_number":15,"box":{"x":117,"y":615,"width":739,"height":11}},{"id":"e09c1809-0082-4284-8deb-a0a503c60f2c","block_type":"box","text":"each business day to reflect changes in the market value of the investment.","page_number":15,"box":{"x":116,"y":630,"width":507,"height":12}},{"id":"1711057a-c1d7-4739-90f1-014210aa35c2","block_type":"box","text":"Shareholders should retain this Supplement for future reference.","page_number":15,"box":{"x":267,"y":661,"width":465,"height":12}},{"id":"42dc802a-38e3-4ad0-9250-31b09c027180","block_type":"box","text":"SAI-MVVI-0526SUP","page_number":15,"box":{"x":116,"y":692,"width":147,"height":9}},{"id":"d3ae8b46-33af-4d75-b35f-482be3d95952","block_type":"box","text":"4","page_number":15,"box":{"x":495,"y":909,"width":8,"height":9}},{"id":"cdce3729-14eb-482e-8a48-be221c1de0b4","block_type":"box","text":"NM1026U-6004382-15/605","page_number":15,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"18686717-fd5b-41cc-8502-4f34162ac675","block_type":"box","text":"STATEMENT OF ADDITIONAL INFORMATION","page_number":16,"box":{"x":273,"y":145,"width":452,"height":11}},{"id":"9cfd97bc-18ea-4631-9c39-1fddb84b49b2","block_type":"box","text":"BlackRock Variable Series Funds, Inc.","page_number":16,"box":{"x":225,"y":170,"width":550,"height":20}},{"id":"1fbc65a4-ef27-41d7-8b48-dc4deb92b78f","block_type":"box","text":"100 Bellevue Parkway, Wilmington, Delaware 19809 • Phone No. (800) 537-4942","page_number":16,"box":{"x":123,"y":200,"width":754,"height":15}},{"id":"6a28e427-359c-4e4c-b61c-07626c8ad059","block_type":"box","text":"BlackRock Variable Series Funds, Inc. (the “Company”) is an open-end management","page_number":16,"box":{"x":151,"y":250,"width":660,"height":12}},{"id":"bfd1880f-8327-4320-ab14-8522f8ff2e21","block_type":"box","text":"investment company which has a wide range of investment objectives among its fifteen separate","page_number":16,"box":{"x":117,"y":264,"width":760,"height":12}},{"id":"bb40b2c4-7483-4bc4-9051-113c4d1714f6","block_type":"box","text":"funds (hereinafter referred to as the “Funds” or individually as a “Fund”): BlackRock 60/40 Target","page_number":16,"box":{"x":116,"y":278,"width":765,"height":12}},{"id":"b69265d4-b1eb-4f9e-ade8-06c8c62fde02","block_type":"box","text":"Allocation ETF V.I. Fund, BlackRock Advantage Large Cap Core V.I. Fund, BlackRock Advantage","page_number":16,"box":{"x":116,"y":293,"width":744,"height":12}},{"id":"94e501e8-fe5f-4c81-aaff-305f06fbd4f7","block_type":"box","text":"Large Cap Value V.I. Fund, BlackRock Advantage SMID Cap V.I. 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Fund and","page_number":16,"box":{"x":117,"y":364,"width":763,"height":12}},{"id":"97884c5b-3478-46e5-8aeb-b2a1838e6606","block_type":"box","text":"BlackRock Small Cap Index V.I. Fund. Three separate classes of shares (“Shares”), Class I Shares,","page_number":16,"box":{"x":118,"y":378,"width":756,"height":11}},{"id":"b1ecb777-fbb7-4ff1-ae65-7a5cceb84e14","block_type":"box","text":"Class II Shares and Class III Shares, may be issued, as applicable, for each Fund. This Statement","page_number":16,"box":{"x":117,"y":392,"width":754,"height":12}},{"id":"d4e6678e-bf4f-40fc-88e0-c7f4a9001cd4","block_type":"box","text":"of Additional Information of the Company is not a prospectus and should be read in conjunction","page_number":16,"box":{"x":117,"y":406,"width":755,"height":12}},{"id":"82ea1d51-a9c9-4b04-91c6-55bbd58ded8a","block_type":"box","text":"with the Prospectuses of the Funds, each dated May 1, 2026 as they may be amended or","page_number":16,"box":{"x":116,"y":420,"width":697,"height":13}},{"id":"6e303fe1-4713-4eee-800b-8e1880b2fd19","block_type":"box","text":"supplemented from time to time (each, a “Prospectus”), which have been filed with the Securities","page_number":16,"box":{"x":116,"y":434,"width":761,"height":12}},{"id":"2ec5aad2-c445-469c-a50d-35ea8ada5747","block_type":"box","text":"and Exchange Commission (the “Commission” or the “SEC”) and can be obtained, without","page_number":16,"box":{"x":117,"y":449,"width":708,"height":12}},{"id":"08fe2c3a-ef57-426c-b121-99e4fd7a61ce","block_type":"box","text":"charge, by calling (800) 537-4942 or by writing to the Company at the above address. Part I of","page_number":16,"box":{"x":117,"y":463,"width":739,"height":12}},{"id":"ce76d8d9-3c9f-4b0f-8dbb-d3ac15c94c31","block_type":"box","text":"this Statement of Additional Information and the portions of Part II of this Statement of","page_number":16,"box":{"x":116,"y":477,"width":686,"height":12}},{"id":"c1f608c4-6023-458d-a125-cd525db243b0","block_type":"box","text":"Additional Information that relate to each Fund have been incorporated by reference into each","page_number":16,"box":{"x":116,"y":492,"width":741,"height":12}},{"id":"85753264-db5d-4730-87d5-93e8a20586b1","block_type":"box","text":"Fund’s Prospectus. The portions of Part II of this Statement of Additional Information that do not","page_number":16,"box":{"x":118,"y":506,"width":759,"height":11}},{"id":"560ba796-6012-4ea3-9207-2560ed00608f","block_type":"box","text":"relate to the Funds do not form a part of the Funds’ Statement of Additional Information, have","page_number":16,"box":{"x":117,"y":520,"width":737,"height":12}},{"id":"6badc735-564d-4b09-92ce-0fb0b5282417","block_type":"box","text":"not been incorporated by reference into each Fund’s Prospectus and should not be relied upon","page_number":16,"box":{"x":117,"y":534,"width":745,"height":12}},{"id":"025bb7ce-0d66-4a85-bc89-ef33a8e4fd91","block_type":"box","text":"by investors in the Funds. The audited financial statements of the Funds are incorporated into","page_number":16,"box":{"x":117,"y":548,"width":739,"height":12}},{"id":"bba764c8-a518-4a3c-ae52-1b2311659258","block_type":"box","text":"this Statement of Additional Information by reference to the Funds’ Annual Financial Statements","page_number":16,"box":{"x":116,"y":563,"width":762,"height":12}},{"id":"11ceb7ad-ca53-4868-8328-c27e3d89a9ce","block_type":"box","text":"and Additional Information for the fiscal year ended December 31, 2025, as filed with the SEC on","page_number":16,"box":{"x":117,"y":577,"width":759,"height":12}},{"id":"8de28731-19e7-41d2-abb6-7c6008621fdb","block_type":"box","text":"Form N-CSR (the “2025 Annual Financial Statements”). You may request a copy of the 2025","page_number":16,"box":{"x":118,"y":591,"width":722,"height":12}},{"id":"a1d67bfa-4c78-402e-9ba4-2a646abd7362","block_type":"box","text":"Annual Financial Statements at no charge by calling (800) 537-4942 between 8:00 a.m. and","page_number":16,"box":{"x":116,"y":605,"width":724,"height":12}},{"id":"1e6ce12b-af23-4f0b-99ce-c6401f7cf7cd","block_type":"box","text":"6:00 p.m. Eastern time on any business day.","page_number":16,"box":{"x":117,"y":620,"width":344,"height":11}},{"id":"b0101e4d-0cc1-4e93-8484-755dd7b20119","block_type":"box","text":"References to the Investment Company Act of 1940, as amended (the “Investment Company","page_number":16,"box":{"x":151,"y":641,"width":726,"height":12}},{"id":"b149c2e1-6411-4266-83c6-fff08572fa06","block_type":"box","text":"Act” or the “1940 Act”), or other applicable law, will include any rules promulgated thereunder","page_number":16,"box":{"x":116,"y":655,"width":734,"height":13}},{"id":"d0e472a8-0a0c-47b9-816a-94e01eda493c","block_type":"box","text":"and any guidance, interpretations or modifications by the Commission, Commission staff or","page_number":16,"box":{"x":117,"y":670,"width":723,"height":12}},{"id":"9062d7ef-8153-4a75-85a2-c471fec290a1","block_type":"box","text":"other authority with appropriate jurisdiction, including court interpretations, and exemptive,","page_number":16,"box":{"x":117,"y":684,"width":722,"height":12}},{"id":"9b83bdb2-f011-4a56-95c7-d90449de5253","block_type":"box","text":"no-action or other relief or permission from the Commission, Commission staff or other","page_number":16,"box":{"x":117,"y":698,"width":688,"height":12}},{"id":"c6e364d2-a6ce-43a6-a169-752f55666f85","block_type":"box","text":"authority.","page_number":16,"box":{"x":117,"y":713,"width":74,"height":12}},{"id":"decf6bf9-209a-44d5-bea0-255bccf25895","block_type":"box","text":"NM1026U-6004382-16/605","page_number":16,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"17ad7ac2-174f-441d-9f6d-43d073b7d1bb","block_type":"box","text":"The date of this Statement of Additional Information is May 1, 2026.","page_number":17,"box":{"x":237,"y":145,"width":524,"height":12}},{"id":"27fc3932-e9eb-4a3c-9e67-9ec03ed76f7c","block_type":"box","text":"BlackRock 60/40 Target Allocation ETF V.I. 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II-106","page_number":18,"box":{"x":434,"y":432,"width":449,"height":9}},{"id":"2714a31c-d28e-4664-a79a-f668df442e97","block_type":"box","text":"Purchase of Shares","page_number":18,"box":{"x":125,"y":448,"width":134,"height":10}},{"id":"d3602524-edef-4c52-bdf5-dc8df53d1c28","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-124","page_number":18,"box":{"x":273,"y":449,"width":610,"height":9}},{"id":"9c6e0ec2-9df4-4fe5-a4ce-4a4d4fae9e3a","block_type":"box","text":"Redemption of Shares","page_number":18,"box":{"x":125,"y":465,"width":158,"height":12}},{"id":"00fed6fc-fa5d-42db-9f7b-cea792b8b718","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-144","page_number":18,"box":{"x":291,"y":465,"width":592,"height":10}},{"id":"6ef42ec4-afc4-430a-8fa8-6b0a80de8ca5","block_type":"box","text":"Shareholder Services","page_number":18,"box":{"x":125,"y":481,"width":147,"height":10}},{"id":"c74d0c4a-cf26-4b94-9c7b-c10e1b98520b","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-148","page_number":18,"box":{"x":282,"y":482,"width":600,"height":9}},{"id":"b910e88b-6f20-4047-83e3-3441b1080bbc","block_type":"box","text":"Pricing of Shares","page_number":18,"box":{"x":125,"y":498,"width":120,"height":13}},{"id":"85d6d4a5-7d71-400f-97d6-d4061da185ee","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 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II-173","page_number":18,"box":{"x":407,"y":566,"width":475,"height":9}},{"id":"678f9ed0-574a-40d7-b14c-847768d85355","block_type":"box","text":"General Information","page_number":18,"box":{"x":125,"y":582,"width":148,"height":10}},{"id":"fe1f083a-1f45-444f-a073-e5c88966c6c0","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-174","page_number":18,"box":{"x":282,"y":582,"width":601,"height":10}},{"id":"8c2ca9af-d5cf-4bf5-ae9a-b6920eb9d509","block_type":"box","text":"Appendix A — Description of Bond Ratings","page_number":18,"box":{"x":124,"y":598,"width":320,"height":13}},{"id":"35c0b341-2af7-4f8d-91f4-7e356ecb4b23","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 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It includes","page_number":20,"box":{"x":116,"y":106,"width":760,"height":12}},{"id":"37dc5e33-a408-4a89-9b05-bf0ba0d6dee0","block_type":"box","text":"information about the Company’s Board of Directors (the “Board” or the “Board of Directors”), the","page_number":20,"box":{"x":116,"y":121,"width":700,"height":13}},{"id":"6b606a63-c53a-4686-842d-06ac27e13b7b","block_type":"box","text":"management services provided to and the management fees paid by each Fund and information about other","page_number":20,"box":{"x":116,"y":137,"width":747,"height":13}},{"id":"85f93ada-6b07-4ca7-a0cc-426ed50bbef0","block_type":"box","text":"fees applicable to and services provided to each Fund. This Part I of this SAI should be read in conjunction","page_number":20,"box":{"x":116,"y":152,"width":738,"height":13}},{"id":"f84f3278-d73d-49ca-830a-15af303c8955","block_type":"box","text":"with each Fund’s Prospectus and those portions of Part II of this SAI that pertain to the Funds.","page_number":20,"box":{"x":116,"y":168,"width":655,"height":13}},{"id":"9b2f386a-4479-4c3e-a24e-4b68ba7f5988","block_type":"box","text":"Shares of each Fund are sold to separate accounts (“Separate Accounts”) of insurance companies (“Insurance","page_number":20,"box":{"x":116,"y":191,"width":758,"height":13}},{"id":"b2e2208e-71b4-45f8-9dca-7ca0ff4ec32a","block_type":"box","text":"Companies”) to fund certain variable life insurance and/or variable annuity contracts (together, “Contracts”)","page_number":20,"box":{"x":117,"y":207,"width":755,"height":12}},{"id":"634a0c32-e186-4a1c-8510-232de6cd8b23","block_type":"box","text":"issued by such companies. Certain Insurance Companies may be affiliates of BlackRock Advisors, LLC","page_number":20,"box":{"x":116,"y":222,"width":713,"height":13}},{"id":"4cf20cb9-d470-4960-af81-b1e55c979aa7","block_type":"box","text":"(“BlackRock” or the “Manager”). The rights of the Insurance Companies as shareholders should be","page_number":20,"box":{"x":117,"y":238,"width":694,"height":12}},{"id":"816f1244-4bcd-46e0-b673-86746e2eab77","block_type":"box","text":"distinguished from the rights of a Contract owner, which are set forth in the Contract. A Contract owner has","page_number":20,"box":{"x":116,"y":253,"width":757,"height":13}},{"id":"22d5f6fb-f626-48d2-976c-73c41fd9d7fe","block_type":"box","text":"no interest in the shares of each Fund, but only in the Contract. A Contract is described in the prospectus for","page_number":20,"box":{"x":116,"y":269,"width":754,"height":13}},{"id":"e0c23a71-159a-4b71-b96a-e264aec47760","block_type":"box","text":"that Contract. That prospectus describes the relationship between increases or decreases in the net asset value","page_number":20,"box":{"x":116,"y":284,"width":758,"height":13}},{"id":"118b14dc-50bc-4900-8075-ca95ef288603","block_type":"box","text":"of shares of each Fund, and any distributions on such shares, and the benefits provided under a Contract. The","page_number":20,"box":{"x":116,"y":300,"width":762,"height":13}},{"id":"c55dba5e-00c4-4130-a969-665bf66164c4","block_type":"box","text":"prospectus for the Contracts also describes various fees payable to the Insurance Companies and charges to","page_number":20,"box":{"x":116,"y":315,"width":744,"height":13}},{"id":"787a6cb1-4f1f-49bc-a90d-75a7023994e7","block_type":"box","text":"the Separate Accounts made by the Insurance Companies with respect to the Contracts. Since shares of the","page_number":20,"box":{"x":116,"y":331,"width":739,"height":13}},{"id":"55f8e723-c094-4cf8-8abe-e0c70ab04bde","block_type":"box","text":"Funds will be sold only to the Insurance Companies for the Separate Accounts, the terms “shareholder” and","page_number":20,"box":{"x":116,"y":346,"width":750,"height":13}},{"id":"f241ceab-89ca-48fc-924c-bea1398d2763","block_type":"box","text":"“shareholders” in this SAI refer to the Insurance Companies.","page_number":20,"box":{"x":117,"y":362,"width":420,"height":13}},{"id":"f98e2494-a152-4073-a608-f85ca73f0206","block_type":"box","text":"I. Investment Objectives and Policies","page_number":20,"box":{"x":116,"y":390,"width":317,"height":13}},{"id":"796a637b-7b92-4e65-9697-f360fd3970d9","block_type":"box","text":"Please see the section “Details About the Fund — How the Fund Invests” in each Fund’s Prospectus for","page_number":20,"box":{"x":116,"y":416,"width":717,"height":13}},{"id":"277d4c1d-e476-4b83-b604-0868738c3609","block_type":"box","text":"information about the Fund’s investment objective and policies.","page_number":20,"box":{"x":116,"y":431,"width":440,"height":13}},{"id":"9ee1752f-443a-4c4d-aba4-1da2b01df1e7","block_type":"box","text":"The Funds that are subject to Rule 35d-1 under the Investment Company Act of 1940, as amended (the","page_number":20,"box":{"x":116,"y":455,"width":718,"height":13}},{"id":"8aa15a2a-44a5-4d97-a70c-716c1864def4","block_type":"box","text":"“Investment Company Act”), will not change their inv","page_number":20,"box":{"x":117,"y":470,"width":377,"height":13}},{"id":"82fc36f8-7620-4d8f-98d3-a44e87c2c169","block_type":"box","text":"estment policies required by that rule without giving","page_number":20,"box":{"x":495,"y":470,"width":362,"height":13}},{"id":"cb755df3-ab2d-4287-93fe-81a6c8334598","block_type":"box","text":"shareholders 60 days’ prior written notice.","page_number":20,"box":{"x":116,"y":486,"width":293,"height":13}},{"id":"834a5ebb-ca73-4ec8-8799-bd2092fa3ac0","block_type":"box","text":"Set forth below is a listing of some of the types of investments and investment strategies that a Fund may use,","page_number":20,"box":{"x":116,"y":509,"width":756,"height":13}},{"id":"719bb54a-461e-4e31-b82e-92e1fcd708e7","block_type":"box","text":"and the risks and considerations associated with those inv","page_number":20,"box":{"x":116,"y":525,"width":401,"height":10}},{"id":"a770e68e-2e20-4235-927b-52a93b14863e","block_type":"box","text":"estments and investment strategies. 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It is not expected that such investment","page_number":34,"box":{"x":116,"y":797,"width":368,"height":13}},{"id":"60bc5bc3-b490-48ba-80fc-1f3ea27edb89","block_type":"box","text":"limitations will materially affect the ability of each Fund","page_number":34,"box":{"x":489,"y":797,"width":389,"height":13}},{"id":"14bde142-728c-4601-b9f0-e10c7cef6982","block_type":"box","text":"to achieve its investment objective.","page_number":34,"box":{"x":116,"y":812,"width":239,"height":13}},{"id":"c0f6a24d-2c70-4f9a-82ee-4f095c0e16c2","block_type":"box","text":"Regulation Regarding Derivatives.","page_number":34,"box":{"x":116,"y":838,"width":243,"height":13}},{"id":"4f83e82b-1aca-487c-b455-1d0b1ed4ae1a","block_type":"box","text":"The Commodity Futures Trading Commission (“CFTC”) subjects","page_number":34,"box":{"x":365,"y":838,"width":467,"height":13}},{"id":"4c1b16f2-dec0-4703-a364-33c40b1e7c60","block_type":"box","text":"advisers to registered investment companies to regulation by the CFTC if a fund that is advised by the","page_number":34,"box":{"x":116,"y":854,"width":722,"height":13}},{"id":"42d986f1-2857-442a-892b-3e8fee5c393a","block_type":"box","text":"investment adviser either (i) invests, directly or indirectly, more than a prescribed level of its liquidation","page_number":34,"box":{"x":116,"y":869,"width":734,"height":13}},{"id":"d2875b8e-c0da-4580-b7af-048998349456","block_type":"box","text":"I-16","page_number":34,"box":{"x":485,"y":917,"width":29,"height":9}},{"id":"c5730b69-6093-43c9-9ea6-3d64c0cfa99e","block_type":"box","text":"NM1026U-6004382-34/605","page_number":34,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"7502d8b2-8052-4f03-adc4-6f57f4e4a9df","block_type":"box","text":"value in CFTC-regulated futures, options and swaps (“CFTC Derivatives”), or (ii) markets itself as","page_number":35,"box":{"x":116,"y":79,"width":700,"height":13}},{"id":"fab1504a-31b4-4b7f-bbb7-df120e7e4314","block_type":"box","text":"providing investment exposure to such instruments. The CFTC also subjects advisers to registered","page_number":35,"box":{"x":116,"y":94,"width":694,"height":13}},{"id":"fc053c64-cfa3-40af-a62a-df1728cd3de7","block_type":"box","text":"investment companies to regulation by the CFTC if the registered investment company invests in one or","page_number":35,"box":{"x":116,"y":110,"width":735,"height":13}},{"id":"bad2281a-5a3f-40f1-b760-f15303ad6733","block_type":"box","text":"more commodity pools. To the extent a Fund (other","page_number":35,"box":{"x":116,"y":125,"width":370,"height":13}},{"id":"27bef270-83c0-4174-8b16-e36c70e43332","block_type":"box","text":"than BlackRock Managed Volatility V.I. Fund) uses","page_number":35,"box":{"x":491,"y":125,"width":368,"height":13}},{"id":"07778ba4-396d-4573-b7f4-59063b864abf","block_type":"box","text":"CFTC Derivatives, it intends to do so below such prescribed levels and will not market itself as a","page_number":35,"box":{"x":117,"y":141,"width":685,"height":13}},{"id":"b8fcd4b9-f685-4032-b8fe-d6dd6cdc525a","block_type":"box","text":"“commodity pool” or a vehicle for trading such instruments.","page_number":35,"box":{"x":117,"y":156,"width":430,"height":13}},{"id":"93b958cc-46f9-4f09-85ab-6871523df42c","block_type":"box","text":"BlackRock has claimed an exclusion from the definition of the term “commodity pool operator” under the","page_number":35,"box":{"x":116,"y":178,"width":741,"height":13}},{"id":"9c79b36c-af21-49e1-8298-c0c1a19d9d4b","block_type":"box","text":"Commodity Exchange Act (“CEA”) pursuant to Rule 4.5 under the CEA (“Rule 4.5”) with respect to","page_number":35,"box":{"x":117,"y":194,"width":705,"height":13}},{"id":"71e1c457-1ccd-46fe-926a-5672a7797fbf","block_type":"box","text":"BlackRock Basic Value V.I. Fund, BlackRock Capita","page_number":35,"box":{"x":116,"y":209,"width":366,"height":13}},{"id":"b69b629b-7a78-4235-b482-6e542699c9f3","block_type":"box","text":"l Appreciation V.I. Fund, BlackRock Equity Dividend","page_number":35,"box":{"x":483,"y":209,"width":371,"height":13}},{"id":"3d261f4d-44b8-46d1-9a89-e63a70541cf6","block_type":"box","text":"V.I. Fund, BlackRock Government Money Market V.I. F","page_number":35,"box":{"x":116,"y":225,"width":396,"height":13}},{"id":"a2a3dc1c-243c-4ee7-8b40-2c7a574b7863","block_type":"box","text":"und, BlackRock International V.I. Fund, BlackRock","page_number":35,"box":{"x":513,"y":225,"width":360,"height":12}},{"id":"b9de64c7-74ed-44ee-9225-4684e0db2279","block_type":"box","text":"International Index V.I. Fund, BlackRock Advantage Large Cap Core V.I. Fund, BlackRock Large Cap Focus","page_number":35,"box":{"x":116,"y":240,"width":759,"height":13}},{"id":"ff1dfa53-dd9a-4048-ba6b-c3488e793e81","block_type":"box","text":"Growth V.I. Fund, BlackRock Advantage Large Cap Value V.I. Fund, BlackRock S&P 500 Index V.I. Fund,","page_number":35,"box":{"x":117,"y":256,"width":751,"height":13}},{"id":"2d4e52f6-aa6c-4fdc-be5a-49bb795da3d2","block_type":"box","text":"BlackRock Small Cap Index V.I. Fund and BlackRock Advantage SMID Cap V.I. Fund. BlackRock is not,","page_number":35,"box":{"x":116,"y":271,"width":737,"height":13}},{"id":"89d6f8fc-ac6b-4ca1-8461-1f4af6bc23c8","block_type":"box","text":"therefore, subject to registration or regulation as a “commodity pool operator” under the CEA in respect of","page_number":35,"box":{"x":116,"y":287,"width":747,"height":13}},{"id":"011a01d6-a7b9-4e16-ae34-c6f9b2a9d983","block_type":"box","text":"such Funds.","page_number":35,"box":{"x":116,"y":302,"width":81,"height":10}},{"id":"08c700ab-3593-4604-b785-b429548a56f4","block_type":"box","text":"Due to BlackRock Managed Volatility V.I. Fund’s potential use of CFTC Derivatives above the prescribed","page_number":35,"box":{"x":116,"y":325,"width":737,"height":12}},{"id":"6abde014-0bc0-4f64-b47b-248db476c4c3","block_type":"box","text":"levels, however, BlackRock Managed Volatility V.I. Fund will be considered a “commodity pool” under the","page_number":35,"box":{"x":116,"y":340,"width":750,"height":13}},{"id":"81de51b3-8e20-439e-9072-cfbb6788e26a","block_type":"box","text":"CEA. Accordingly, BlackRock, the adviser of BlackRock Managed Volatility V.I. Fund has registered as a","page_number":35,"box":{"x":117,"y":356,"width":732,"height":12}},{"id":"c72dd445-a440-4095-b907-cd0e2978e3ca","block_type":"box","text":"“commodity pool operator” and is subject to CFTC regulation in respect of the Fund.","page_number":35,"box":{"x":117,"y":371,"width":595,"height":13}},{"id":"51a9878f-415c-43a1-a7fe-dd9ce82a5b16","block_type":"box","text":"BlackRock Global Allocation V.I. Fund and BlackRock 60/40 Target Allocation ETF V.I. Fund may also have","page_number":35,"box":{"x":116,"y":393,"width":764,"height":13}},{"id":"94f53b25-d750-4834-a750-a6bab2bfebb3","block_type":"box","text":"investments in “underlying funds” (and such underlyi","page_number":35,"box":{"x":116,"y":409,"width":372,"height":12}},{"id":"5596f3cd-96e7-495e-be31-6efeec1bdf52","block_type":"box","text":"ng funds themselves may invest in underlying funds) not","page_number":35,"box":{"x":488,"y":409,"width":390,"height":12}},{"id":"41f268e9-f9a1-4a17-95d1-fac4bd6eb541","block_type":"box","text":"advised by BlackRock (which for purposes of the no-action letter referenced below may include certain","page_number":35,"box":{"x":116,"y":424,"width":714,"height":13}},{"id":"2f8396fd-99c3-4b84-b3de-9ce7de7cf47c","block_type":"box","text":"securitized vehicles, mortgage real estate investment trusts and/or investment companies that may invest in","page_number":35,"box":{"x":116,"y":440,"width":737,"height":12}},{"id":"7020c613-f1a2-4e23-b3fc-0282830e2a20","block_type":"box","text":"CFTC Derivatives), and therefore may be viewed by the CFTC as a commodity pool. BlackRock has no","page_number":35,"box":{"x":117,"y":455,"width":719,"height":13}},{"id":"de4ff000-8dd3-44a8-86a8-1af20714e61f","block_type":"box","text":"transparency into the holdings of these underlying funds because they are not advised by BlackRock. To","page_number":35,"box":{"x":116,"y":471,"width":722,"height":12}},{"id":"7904198e-cf3c-40ef-b3cd-d54063ce33a2","block_type":"box","text":"address this issue of lack of transparency, the CFTC staff issued a no-action letter on November 29, 2012","page_number":35,"box":{"x":116,"y":486,"width":732,"height":13}},{"id":"ef0662f8-79e1-44ab-b2cf-6600ae33f475","block_type":"box","text":"permitting the adviser of a fund that invests in such underlying funds and that would otherwise have filed a","page_number":35,"box":{"x":116,"y":502,"width":743,"height":12}},{"id":"2ff0ce91-a37e-4bbe-81bf-62a7465434f3","block_type":"box","text":"claim of exclusion pursuant to Rule 4.5 to delay registration as a “commodity pool operator” until six","page_number":35,"box":{"x":116,"y":517,"width":711,"height":13}},{"id":"8facf14d-660d-498d-93fe-ec4d135ba68f","block_type":"box","text":"months from the date on which the CFTC issues additional guidance on the treatment of CFTC Derivatives","page_number":35,"box":{"x":116,"y":533,"width":746,"height":12}},{"id":"23d50643-7bfa-4307-9606-f6dea99eeba5","block_type":"box","text":"held by underlying funds. BlackRock, the adviser of BlackRock Global Allocation V.I. Fund and BlackRock","page_number":35,"box":{"x":116,"y":548,"width":749,"height":13}},{"id":"270f12b7-47e9-41dc-bc9a-b79272906c19","block_type":"box","text":"60/40 Target Allocation ETF V.I. Fund, has filed a claim with the CFTC for the Funds to rely on this","page_number":35,"box":{"x":117,"y":564,"width":699,"height":12}},{"id":"10f4f417-8037-4fae-b346-5029f2892590","block_type":"box","text":"no-action relief. Accordingly, BlackRock is not subject to registration or regulation as a “commodity pool","page_number":35,"box":{"x":116,"y":579,"width":734,"height":13}},{"id":"391ed1cc-5f8b-4664-b025-df72ed7c12a9","block_type":"box","text":"operator” under the CEA in respect of BlackRock Global Allocation V.I. Fund and BlackRock 60/40 Target","page_number":35,"box":{"x":116,"y":595,"width":751,"height":12}},{"id":"0f7bf14b-df09-474c-8e5e-c5fb7857a44c","block_type":"box","text":"Allocation ETF V.I. Fund.","page_number":35,"box":{"x":116,"y":610,"width":180,"height":10}},{"id":"fb751993-eba1-491f-96f2-aa28cc9c0f5d","block_type":"box","text":"BlackRock Global Allocation V.I. Fund’s primary vehicle for gaining exposure to the commodities markets is","page_number":35,"box":{"x":116,"y":632,"width":757,"height":13}},{"id":"bb7d7eeb-d181-4c13-84d7-ae2f87d2a545","block_type":"box","text":"expected to be through investments in BlackRock Cayman Global Allocation V.I. Fund I, Ltd., a wholly","page_number":35,"box":{"x":116,"y":648,"width":722,"height":13}},{"id":"486be010-d17c-4bc6-bd6b-ed2fd77dc2d5","block_type":"box","text":"owned subsidiary of BlackRock Global Allocation V.I. Fund formed in the Cayman Islands (the “Global","page_number":35,"box":{"x":116,"y":663,"width":726,"height":13}},{"id":"29326d11-f10a-41e9-b076-40ab395b0930","block_type":"box","text":"Allocation Subsidiary” or the “Subsidiary”), which inv","page_number":35,"box":{"x":116,"y":679,"width":381,"height":13}},{"id":"6fbf298f-2f8b-4539-9521-a18c7f5895f6","block_type":"box","text":"ests primarily in commodity-related instruments. The","page_number":35,"box":{"x":497,"y":679,"width":369,"height":13}},{"id":"df556afa-64f3-4fe6-b8a8-5ccc8295177a","block_type":"box","text":"Subsidiary may also hold cash and invest in other instruments, including fixed-income securities, either as","page_number":35,"box":{"x":116,"y":694,"width":731,"height":13}},{"id":"0c1a773e-951c-4291-b192-186f4f4c3484","block_type":"box","text":"investments or to serve as margin or collateral for the Subsidiary’s derivative positions.","page_number":35,"box":{"x":116,"y":710,"width":600,"height":13}},{"id":"4a918b65-8a83-4096-981e-a7b177e23279","block_type":"box","text":"Investments in the Subsidiary","page_number":35,"box":{"x":116,"y":736,"width":212,"height":13}},{"id":"76764e20-b638-4d90-b66c-9f3c9f2269de","block_type":"box","text":"BlackRock Global Allocation V.I. Fund may invest up to 25% of its total assets in the shares of its wholly","page_number":35,"box":{"x":116,"y":761,"width":739,"height":12}},{"id":"fb526022-a356-4325-972c-a711461f9e4a","block_type":"box","text":"owned and controlled Global Allocation Subsidiary. Investments in the Subsidiary are expected to provide","page_number":35,"box":{"x":116,"y":776,"width":736,"height":13}},{"id":"654f0a3d-5ae9-4c85-b434-bff92fa20017","block_type":"box","text":"BlackRock Global Allocation V.I. Fund with exposure t","page_number":35,"box":{"x":116,"y":792,"width":387,"height":13}},{"id":"8096e446-0fcf-4a1e-81bc-253244fb6b29","block_type":"box","text":"o the commodity markets within the limitations of","page_number":35,"box":{"x":504,"y":792,"width":351,"height":13}},{"id":"a658b555-4339-4dc7-8346-b08d72ed7f52","block_type":"box","text":"Subchapter M of the Internal Revenue Code of 1986, as","page_number":35,"box":{"x":116,"y":807,"width":389,"height":13}},{"id":"3e2b4676-13ef-415d-9559-b8fc3e867101","block_type":"box","text":"amended (the “Internal Revenue Code”), and IRS","page_number":35,"box":{"x":510,"y":807,"width":345,"height":13}},{"id":"8cbe3c42-b661-4cdd-8869-29c78dd298f3","block_type":"box","text":"revenue rulings, as discussed below. The Subsidiary is advised by the Manager. The Subsidiary (unlike","page_number":35,"box":{"x":116,"y":823,"width":707,"height":13}},{"id":"4720dd2c-dd06-4098-b762-913e81c641de","block_type":"box","text":"BlackRock Global Allocation V.I. Fund) may invest wit","page_number":35,"box":{"x":116,"y":838,"width":386,"height":13}},{"id":"8c3b1b98-b773-4fb5-ba4f-21242e29be9c","block_type":"box","text":"hout limitation in commodity-related instruments.","page_number":35,"box":{"x":502,"y":838,"width":348,"height":13}},{"id":"df04ad39-3009-40a8-ac16-200c9925fa8c","block_type":"box","text":"However, the Global Allocation Subsidiary is otherwise subject to the same fundamental, non-fundamental","page_number":35,"box":{"x":116,"y":854,"width":745,"height":13}},{"id":"bdf6b8ab-cfab-4aef-8040-c8a785c144eb","block_type":"box","text":"and certain other investment restrictions as BlackRock Global Allocation V.I. Fund, including the timing and","page_number":35,"box":{"x":116,"y":869,"width":756,"height":13}},{"id":"bb4f89f7-5768-421d-9ccd-1ff7665dd978","block_type":"box","text":"I-17","page_number":35,"box":{"x":485,"y":917,"width":29,"height":9}},{"id":"96ef695a-4998-457e-8646-43e698c2ca85","block_type":"box","text":"NM1026U-6004382-35/605","page_number":35,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"68d025fc-b560-4ee3-9660-d27c314c1e35","block_type":"box","text":"method of the valuation of the Subsidiary’s portfolio investments and shares of the Subsidiary. The Subsidiary","page_number":36,"box":{"x":116,"y":79,"width":763,"height":13}},{"id":"5fbbc28d-3d94-4b35-bf28-05e9208a986b","block_type":"box","text":"is managed pursuant to compliance policies and procedures that are the same, in all material respects, as the","page_number":36,"box":{"x":116,"y":94,"width":749,"height":13}},{"id":"24e44f83-5964-479c-9222-ccdeace14d71","block_type":"box","text":"policies and procedures adopted by the Company. The Subsidiary is a company organized under the laws of","page_number":36,"box":{"x":116,"y":110,"width":750,"height":13}},{"id":"1b71e7f1-5cdb-4d53-a042-8f8074c4f673","block_type":"box","text":"the Cayman Islands, and is overseen by its own board of directors, which is comprised of Trent Walker, Chief","page_number":36,"box":{"x":116,"y":125,"width":764,"height":13}},{"id":"eb60cc7e-3560-43f6-9806-9ae3b21821e4","block_type":"box","text":"Financial Officer of the Company, and John M. Perlowski, a Director, President and Chief Executive Officer","page_number":36,"box":{"x":116,"y":141,"width":754,"height":13}},{"id":"0031bccd-e90d-40ee-aff1-c9d336da110f","block_type":"box","text":"of the Company. BlackRock Global Allocation V.I. Fund is the sole shareholder of the Global Allocation","page_number":36,"box":{"x":116,"y":156,"width":728,"height":13}},{"id":"29ae2482-df93-49dc-bc7f-bca53009e972","block_type":"box","text":"Subsidiary, and shares of the Subsidiary will not be sold or offered to other investors.","page_number":36,"box":{"x":116,"y":172,"width":589,"height":13}},{"id":"5058dab6-3fda-4934-a501-c048d8107670","block_type":"box","text":"The Global Allocation Subsidiary invests primarily in co","page_number":36,"box":{"x":116,"y":197,"width":390,"height":12}},{"id":"cf0d391a-0bde-4563-a4a2-b5fd37a7514a","block_type":"box","text":"mmodity-related instruments. Although BlackRock","page_number":36,"box":{"x":507,"y":197,"width":355,"height":12}},{"id":"4b2f4554-5fa0-492e-a427-fee8854e3888","block_type":"box","text":"Global Allocation V.I. Fund may enter into these commodity","page_number":36,"box":{"x":117,"y":212,"width":422,"height":13}},{"id":"570f5c53-f00d-421f-8957-44805e638045","block_type":"box","text":"-related instruments directly, BlackRock Global","page_number":36,"box":{"x":540,"y":212,"width":330,"height":13}},{"id":"f598c102-19a5-47fc-9c94-a1bec25a18e6","block_type":"box","text":"Allocation V.I. Fund will likely gain exposure to these comm","page_number":36,"box":{"x":116,"y":228,"width":422,"height":12}},{"id":"52a9c9fb-9b32-4c4e-91db-9695b1ad2994","block_type":"box","text":"odity-related instruments indirectly by investing","page_number":36,"box":{"x":538,"y":228,"width":331,"height":12}},{"id":"8596df07-783b-41ce-94f3-65b763a564bd","block_type":"box","text":"in the Global Allocation Subsidiary. To the extent that BlackRock believes that these commodity-related","page_number":36,"box":{"x":116,"y":243,"width":724,"height":13}},{"id":"48dc7292-b2e7-47e3-9b50-1b9bd080416d","block_type":"box","text":"instruments provide suitable exposure to the commodities market, BlackRock Global Allocation V.I. Fund’s","page_number":36,"box":{"x":116,"y":259,"width":749,"height":12}},{"id":"ce7fee3c-2673-4069-885e-125bfa3feea8","block_type":"box","text":"investments in the Subsidiary will likely increase. The Subsidiary may also hold cash and invest in other","page_number":36,"box":{"x":116,"y":274,"width":717,"height":13}},{"id":"2ced64bb-b9a0-4eb0-9dcb-705ec4f45695","block_type":"box","text":"instruments, including fixed-income securities, either as investments or to serve as margin or collateral for the","page_number":36,"box":{"x":116,"y":290,"width":758,"height":12}},{"id":"580acf9a-fb65-4527-a2a3-1e08cd5b1fee","block_type":"box","text":"Subsidiary’s derivative positions.","page_number":36,"box":{"x":116,"y":305,"width":225,"height":13}},{"id":"a6fe11f3-8f4b-4eac-803e-1f22642a8989","block_type":"box","text":"The Manager manages the assets of the Subsidiary, but receives no additional compensation for doing so. The","page_number":36,"box":{"x":116,"y":330,"width":762,"height":13}},{"id":"9099e3df-3858-46e2-b5d7-4954b2283978","block_type":"box","text":"Manager also provides certain administrative services for the Subsidiary, but receives no additional","page_number":36,"box":{"x":116,"y":345,"width":685,"height":13}},{"id":"1db53f1f-cae4-4b21-9fef-23a6757153e8","block_type":"box","text":"compensation for doing so. The Subsidiary will also enter into separate contracts for the provision of","page_number":36,"box":{"x":116,"y":361,"width":701,"height":13}},{"id":"947ecb17-3a11-4111-a381-cecbce7e92f8","block_type":"box","text":"advisory, sub-advisory, custody and accounting agent services with the same or with affiliates of the same","page_number":36,"box":{"x":116,"y":376,"width":732,"height":13}},{"id":"a20359d9-9d82-460f-830f-cec916f3c185","block_type":"box","text":"service providers that provide those services to BlackRock Global Allocation V.I. Fund.","page_number":36,"box":{"x":116,"y":392,"width":605,"height":13}},{"id":"5f048e09-4a29-4c0d-8b3b-272e95525385","block_type":"box","text":"The financial statements of the Global Allocation Subsid","page_number":36,"box":{"x":116,"y":417,"width":392,"height":10}},{"id":"91446205-d333-4725-bd6a-f6130890eac4","block_type":"box","text":"iary will be consolidated with the financial statements","page_number":36,"box":{"x":509,"y":417,"width":372,"height":13}},{"id":"0c9b4ace-3276-41d5-81cc-15a082dff48f","block_type":"box","text":"in the Annual and Semi-Annual Financial Statements and Additional Information of BlackRock Global","page_number":36,"box":{"x":116,"y":432,"width":715,"height":10}},{"id":"93e84e5a-d20b-4346-b157-d5cb09c9ae8f","block_type":"box","text":"Allocation V.I. Fund. Copies of BlackRock Global Allocation V.I. 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The","page_number":36,"box":{"x":116,"y":566,"width":734,"height":12}},{"id":"ccde07f0-6ce0-4d32-ace9-3dbda7bf0767","block_type":"box","text":"Company’s Board of Directors has oversight responsibility for the investment activities of BlackRock Global","page_number":36,"box":{"x":117,"y":581,"width":750,"height":13}},{"id":"3b711f7e-04a2-4b6d-a275-3d9bc511e163","block_type":"box","text":"Allocation V.I. Fund, including with respect to the Fund’s investment in the Subsidiary, and the Fund’s role as","page_number":36,"box":{"x":116,"y":597,"width":761,"height":12}},{"id":"f66ff0c0-a3b2-43bd-a62c-54a9eecdc6d8","block_type":"box","text":"sole shareholder of the Subsidiary. As noted above, the Subsidiary will be subject to the same investment","page_number":36,"box":{"x":116,"y":612,"width":724,"height":13}},{"id":"e36e91f3-3b52-4200-9084-5eeb9c080d5d","block_type":"box","text":"restrictions and limitations, and follow the same compliance policies and procedures, as BlackRock Global","page_number":36,"box":{"x":116,"y":628,"width":740,"height":12}},{"id":"a82ca10e-d476-458a-9431-97cc2f9c0542","block_type":"box","text":"Allocation V.I. Fund. The Subsidiary is managed pursuant to compliance policies and procedures that are the","page_number":36,"box":{"x":116,"y":643,"width":757,"height":13}},{"id":"a9b85573-7a3a-4db3-8111-7c6ed288c13e","block_type":"box","text":"same, in all material respects, as the policies and procedures adopted by the Company. In addition, changes in","page_number":36,"box":{"x":116,"y":659,"width":762,"height":12}},{"id":"0b17139f-7340-412e-afb0-47a34451ad72","block_type":"box","text":"the laws of the United States and/or the Cayman Islands could result in the inability of BlackRock Global","page_number":36,"box":{"x":116,"y":674,"width":729,"height":13}},{"id":"37657a16-6813-4d38-8d31-358a2a1a6109","block_type":"box","text":"Allocation V.I. Fund and/or the Subsidiary to operate","page_number":36,"box":{"x":116,"y":690,"width":370,"height":12}},{"id":"095eb0f5-9cfb-4e80-aaba-cfdd940cf4a0","block_type":"box","text":"as described in BlackRock Global Allocation V.I. Fund’s","page_number":36,"box":{"x":492,"y":690,"width":390,"height":10}},{"id":"e66efd2d-1ac0-47ae-afaa-03033d9b9544","block_type":"box","text":"Prospectus and this SAI, and could adversely affect BlackRock Global Allocation V.I. Fund. For example, the","page_number":36,"box":{"x":116,"y":705,"width":757,"height":13}},{"id":"0d97353e-02aa-46f4-a394-dbf56a53cd73","block_type":"box","text":"Cayman Islands does not currently impose any income, corporate or capital gains tax, estate duty, inheritance","page_number":36,"box":{"x":117,"y":721,"width":761,"height":12}},{"id":"4473d919-fcbc-44ab-9ba8-1ade0c9b9e7f","block_type":"box","text":"tax, gift tax or withholding tax on the Subsidiary. If Cayman Islands law changes such that the Subsidiary","page_number":36,"box":{"x":116,"y":736,"width":735,"height":13}},{"id":"17971624-459b-42fd-8395-6bdfede4217a","block_type":"box","text":"must pay Cayman Islands taxes, shareholders of BlackRock Global Allocation V.I. Fund would likely suffer","page_number":36,"box":{"x":116,"y":752,"width":748,"height":12}},{"id":"e349d477-db94-4d16-a397-1f66ac6992dc","block_type":"box","text":"decreased investment returns.","page_number":36,"box":{"x":116,"y":767,"width":203,"height":10}},{"id":"91f694f0-2b02-4264-a3bc-43161d41dca1","block_type":"box","text":"The Subsidiary will not be subject to U.S. federal income tax. The Subsidiary will, however, be considered a","page_number":36,"box":{"x":116,"y":792,"width":747,"height":13}},{"id":"c3498863-04cd-415d-aa0e-547ebd32e4cb","block_type":"box","text":"controlled foreign corporation, and BlackRock Global Allocation V.I. Fund will be required to include as","page_number":36,"box":{"x":116,"y":807,"width":730,"height":13}},{"id":"d015f9ac-3a17-480d-9b2b-cb1f558fd909","block_type":"box","text":"income annually amounts earned by the Subsidiary during that year, whether or not the Subsidiary distributes","page_number":36,"box":{"x":116,"y":823,"width":762,"height":13}},{"id":"0a46f1eb-f2bd-45ec-b718-2bf091aa6a4c","block_type":"box","text":"such amounts to the Fund. Gains from the sales of investments by the Subsidiary will not be eligible for capital","page_number":36,"box":{"x":116,"y":838,"width":767,"height":13}},{"id":"396ec6d8-6999-4ad6-8cb7-3eb7f66a8ef2","block_type":"box","text":"gains treatment but instead will be treated as ordinary income when included in income by the Fund.","page_number":36,"box":{"x":116,"y":854,"width":699,"height":13}},{"id":"6d7dc64d-3a34-4565-aac5-f3d6933de93c","block_type":"box","text":"Furthermore, the requirement for the Fund to distribute net investment income, if any, and net realized capital","page_number":36,"box":{"x":116,"y":869,"width":764,"height":13}},{"id":"dfc3eea9-9adf-4556-9ac8-9f376376b5a8","block_type":"box","text":"I-18","page_number":36,"box":{"x":485,"y":917,"width":28,"height":9}},{"id":"15b86418-906c-4760-b9b0-83fa583a18b1","block_type":"box","text":"NM1026U-6004382-36/605","page_number":36,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"24d3bae4-a8ee-4844-8294-7b14d172265a","block_type":"box","text":"gain, if any, at least annually will apply to such Subsidiary income, whether or not the Subsidiary makes a","page_number":37,"box":{"x":116,"y":79,"width":735,"height":13}},{"id":"1dc51c41-be90-4ff7-8370-26f1f7605ff1","block_type":"box","text":"distribution to the Fund during the taxable year. If the Subsidiary incurs net losses in any year, such losses will","page_number":37,"box":{"x":116,"y":94,"width":764,"height":13}},{"id":"145a302b-29dd-4869-a019-35bcc0444a18","block_type":"box","text":"not offset the Fund’s income or gains nor carryforward to future years.","page_number":37,"box":{"x":116,"y":110,"width":491,"height":13}},{"id":"a2fe56e3-860d-415c-9cac-db8ea12588ca","block_type":"box","text":"II. Investment Restrictions","page_number":37,"box":{"x":116,"y":139,"width":237,"height":9}},{"id":"2f1ca8f5-4f93-4790-b5cd-4cefa369b9ad","block_type":"box","text":"The Company has adopted the following fundamental and non-fundamental restrictions and policies","page_number":37,"box":{"x":116,"y":164,"width":731,"height":13}},{"id":"f28ca273-cee0-46d3-9174-977afb310bd7","block_type":"box","text":"relating to the investment of the assets of the Funds and their activities. The fundamental policies set","page_number":37,"box":{"x":116,"y":180,"width":729,"height":12}},{"id":"576799a3-966e-4a2b-acbc-72c0ee531ca1","block_type":"box","text":"forth below may not be changed without the approval of the holders of a majority of the outstanding","page_number":37,"box":{"x":116,"y":195,"width":736,"height":13}},{"id":"45561c51-1d45-4ccb-8ad4-f3791a892762","block_type":"box","text":"voting shares of each Fund affected (which for this purpose and under the Investment Company Act","page_number":37,"box":{"x":116,"y":211,"width":726,"height":12}},{"id":"7eaf7ce1-edd5-4c6d-b0b2-112ca6d2588a","block_type":"box","text":"means the lesser of (i) 67% of the shares present at a meeting at which more than 50% of the","page_number":37,"box":{"x":116,"y":226,"width":678,"height":13}},{"id":"e9ed82ed-3db9-4251-9021-06ee8b4192ab","block_type":"box","text":"outstanding shares of the affected Fund are represented or (ii) more than 50% of the outstanding shares","page_number":37,"box":{"x":116,"y":242,"width":754,"height":12}},{"id":"721e17c9-6eae-44dd-9da1-a6135da142c8","block_type":"box","text":"of the affected Fund). The investment objective of each Fund is fundamental, and as such may not be","page_number":37,"box":{"x":116,"y":257,"width":732,"height":13}},{"id":"ae3ab8d9-3ecc-4acb-8478-ce0a5e90ec40","block_type":"box","text":"changed without the approval of the holders of a majority of the outstanding shares of each such Fund,","page_number":37,"box":{"x":116,"y":273,"width":750,"height":12}},{"id":"3caebe48-228a-4cef-bdda-d996b46ff3ee","block_type":"box","text":"except that the investment objective of each of BlackRock Capital Appreciation V.I. Fund, BlackRock","page_number":37,"box":{"x":116,"y":288,"width":739,"height":13}},{"id":"f3a5ffee-1c7a-40a0-b00f-d28af64df45c","block_type":"box","text":"International V.I. Fund, BlackRock International Index V.I. Fund, BlackRock 60/40 Target Allocation","page_number":37,"box":{"x":116,"y":304,"width":742,"height":12}},{"id":"7307a796-8f1f-4a8c-ba1a-1ccdb69a93db","block_type":"box","text":"ETF V.I. Fund, BlackRock Small Cap Index V.I. 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Fund may not purchase any security other than money market","page_number":37,"box":{"x":116,"y":404,"width":746,"height":13}},{"id":"540251b2-fcce-45de-88df-78cfdab84449","block_type":"box","text":"and other securities described under “Investment Objectives and Policies” in BlackRock Government Money","page_number":37,"box":{"x":116,"y":420,"width":754,"height":13}},{"id":"62d782ff-1a32-471c-97b0-d9ee93e62962","block_type":"box","text":"Market V.I. Fund’s Prospectus. In addition, BlackRock Government Money Market V.I. Fund may not","page_number":37,"box":{"x":116,"y":435,"width":717,"height":13}},{"id":"4d5181b9-aa04-4bbc-a96a-912f90ef0d43","block_type":"box","text":"purchase securities of foreign issuers (including Eurodollar and Yankeedollar obligations). In addition,","page_number":37,"box":{"x":116,"y":451,"width":709,"height":13}},{"id":"147d9e21-2627-453f-a756-68c46eb336a0","block_type":"box","text":"BlackRock Government Money Market V.I. 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provided that the Fund may purchase money market securities or enter into","page_number":37,"box":{"x":117,"y":769,"width":751,"height":13}},{"id":"ea2d54f9-6eff-4058-8a77-c4c1577be82e","block_type":"box","text":"repurchase agreements; lend securities owned or held by","page_number":37,"box":{"x":116,"y":784,"width":390,"height":13}},{"id":"c62ad4bc-99b5-49a8-9e0c-2e4232f4467f","block_type":"box","text":"it pursuant to (8) below; and provided further that","page_number":37,"box":{"x":510,"y":784,"width":351,"height":13}},{"id":"bb24572b-0817-4b91-8087-01142accdf22","block_type":"box","text":"for purposes of this restriction the acquisition of a portion of an issue of publicly distributed bonds,","page_number":37,"box":{"x":116,"y":800,"width":689,"height":13}},{"id":"6d5ccdad-82b7-4f4d-8725-98a7cb91d408","block_type":"box","text":"debentures or other corporate debt securities or of government obligations, short-term commercial paper,","page_number":37,"box":{"x":116,"y":815,"width":731,"height":13}},{"id":"b37d0c8c-6a86-44a4-bbba-dcd5698eae87","block_type":"box","text":"certificates of deposit and bankers’ acceptances shall not be deemed the making of a loan.","page_number":37,"box":{"x":116,"y":831,"width":620,"height":13}},{"id":"13c349c5-ef64-4492-80c0-5d2d15f247bd","block_type":"box","text":"(8) lend its portfolio securities in excess of 33","page_number":37,"box":{"x":117,"y":854,"width":311,"height":13}},{"id":"3c61e109-0c63-43be-995f-91b8694ffa1d","block_type":"box","text":"1","page_number":37,"box":{"x":430,"y":855,"width":4,"height":6}},{"id":"57786b63-5fa8-4b36-9b62-d41c373e5466","block_type":"box","text":"/","page_number":37,"box":{"x":435,"y":855,"width":5,"height":9}},{"id":"7454ecb3-0714-47c7-8cfc-a4aee11b867d","block_type":"box","text":"3","page_number":37,"box":{"x":440,"y":861,"width":5,"height":6}},{"id":"ef2a2daf-dc28-4a95-b882-21d1b1341680","block_type":"box","text":"% of its total assets, taken at market value at the time of the","page_number":37,"box":{"x":447,"y":854,"width":416,"height":12}},{"id":"04697a05-b5c9-45b4-a8a5-efc422d60052","block_type":"box","text":"loan, provided that such loans are made according to the guidelines set forth below and the guidelines of the","page_number":37,"box":{"x":116,"y":869,"width":751,"height":13}},{"id":"a6dd879e-a48e-4af6-9fab-2f39b0675a3c","block_type":"box","text":"I-19","page_number":37,"box":{"x":485,"y":917,"width":28,"height":9}},{"id":"29ae7fa3-c1aa-4280-a25b-dc762e7ef0dc","block_type":"box","text":"NM1026U-6004382-37/605","page_number":37,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"a9e94b09-77d7-4939-a6ba-28c0e9c892ac","block_type":"box","text":"SEC and the Company’s Board of Directors, including maintaining collateral from the borrower equal at all","page_number":38,"box":{"x":116,"y":79,"width":748,"height":13}},{"id":"97fe5f4c-fc20-4caf-90bb-5aaac013f3b8","block_type":"box","text":"times to the current market value of the securities loaned.","page_number":38,"box":{"x":116,"y":94,"width":397,"height":10}},{"id":"c977333f-5187-4e01-8e9f-56134d7d13a7","block_type":"box","text":"(9) borrow amounts in excess of 20% of its total assets, taken at market value, and then only from banks as a","page_number":38,"box":{"x":117,"y":118,"width":761,"height":12}},{"id":"c6a6fb48-c53c-4e3e-9daa-fde1f35e9aab","block_type":"box","text":"temporary measure for extraordinary or emergency purposes. The borrowing provisions shall not apply to","page_number":38,"box":{"x":116,"y":133,"width":738,"height":13}},{"id":"5cdf5ddb-7827-4438-9ddc-7d842da0f58c","block_type":"box","text":"reverse repurchase agreements. Usually only “leveraged” investment companies may borrow in excess of 5%","page_number":38,"box":{"x":116,"y":149,"width":754,"height":12}},{"id":"fcb7079b-2e72-4f61-85a2-30039602f594","block_type":"box","text":"of their assets; however, the Fund will not borrow to increase income but only to meet redemption requests","page_number":38,"box":{"x":116,"y":164,"width":744,"height":13}},{"id":"89662a0e-fdd0-4209-b329-430b542f33c9","block_type":"box","text":"which might otherwise require untimely dispositions of portfolio securities. The Fund will not purchase","page_number":38,"box":{"x":116,"y":180,"width":716,"height":12}},{"id":"b97374fd-efed-410e-9c7e-2abd6595ae8e","block_type":"box","text":"securities while borrowings are outstanding.","page_number":38,"box":{"x":116,"y":195,"width":305,"height":13}},{"id":"e52a150d-beeb-418f-84bc-8b229e25b625","block_type":"box","text":"(10) mortgage, pledge, hypothecate or in any manner transfer (except as provided in (8) above), as security for","page_number":38,"box":{"x":117,"y":218,"width":764,"height":13}},{"id":"190ed10b-3428-4316-88bc-12824c251ff4","block_type":"box","text":"indebtedness, any securities owned or held by the Fund except as may be necessary in connection with","page_number":38,"box":{"x":116,"y":234,"width":709,"height":13}},{"id":"0ae5856f-f859-4371-a3f7-8dd568e12120","block_type":"box","text":"borrowings mentioned in (9) above, and then such mortgaging, pledging or hypothecating may not exceed","page_number":38,"box":{"x":116,"y":249,"width":738,"height":13}},{"id":"71af2784-7bae-44d7-87c2-018b97a273ea","block_type":"box","text":"25% of the Fund’s total assets, taken at market value at the time thereof. Although the Fund has the authority","page_number":38,"box":{"x":116,"y":265,"width":765,"height":13}},{"id":"d1d508aa-5c2b-464e-8518-0e2b74590d8f","block_type":"box","text":"to mortgage, pledge or hypothecate more than 10% of its total assets under this investment restriction (10), as","page_number":38,"box":{"x":116,"y":280,"width":764,"height":13}},{"id":"e57b0ea8-2ce5-4d6f-b158-b49d8e740fd7","block_type":"box","text":"a matter of operating policy, the Fund will not mortgage, pledge or hypothecate in excess of 10% of total net","page_number":38,"box":{"x":116,"y":296,"width":757,"height":13}},{"id":"aa30b703-5b73-4428-aa30-2584f0bac973","block_type":"box","text":"assets.","page_number":38,"box":{"x":116,"y":314,"width":42,"height":7}},{"id":"4feeceb8-38e8-4526-a7e4-6e5da3070b72","block_type":"box","text":"(11) act as an underwriter of securities, except insofar as the Fund may be deemed an underwriter under the","page_number":38,"box":{"x":117,"y":335,"width":747,"height":12}},{"id":"7558cb8d-df9b-4dfc-8826-f1bf20632c96","block_type":"box","text":"Securities Act of 1933, as amended (the “Securities Act”), in selling portfolio securities.","page_number":38,"box":{"x":116,"y":350,"width":603,"height":13}},{"id":"0bf513de-7c05-4ecb-9aea-f023284f8e99","block_type":"box","text":"(12) purchase, either alone or together with any other Fund or Funds, more than 10% of the outstanding","page_number":38,"box":{"x":117,"y":373,"width":729,"height":13}},{"id":"71ac7e56-3365-4ae9-b193-1c395d4ee492","block_type":"box","text":"securities of an issuer except that such restriction does not apply to U.S. Government or government agency","page_number":38,"box":{"x":116,"y":389,"width":747,"height":13}},{"id":"80407594-4706-4d34-ae67-a0afe19cdf9b","block_type":"box","text":"securities, bank money instruments or repurchase agreements.","page_number":38,"box":{"x":116,"y":404,"width":429,"height":13}},{"id":"0e787e70-e334-4ae2-adb3-32bb3a48627c","block_type":"box","text":"(13) invest in securities (except for repurchase agreements or variable amount master notes) with legal or","page_number":38,"box":{"x":117,"y":428,"width":725,"height":12}},{"id":"127583e7-37ae-4377-96f1-d94308739c9f","block_type":"box","text":"contractual restrictions on resale or for which no readily available market exists or in securities of issuers","page_number":38,"box":{"x":116,"y":443,"width":726,"height":13}},{"id":"41936869-2d50-4d21-abdf-34974c801fa8","block_type":"box","text":"(other than issuers of government agency securities)","page_number":38,"box":{"x":117,"y":459,"width":356,"height":12}},{"id":"3a4be4db-30c3-46fb-99b7-9a9ee51bc463","block_type":"box","text":"having a record, together with predecessors, of less than","page_number":38,"box":{"x":479,"y":459,"width":387,"height":12}},{"id":"7cf706d0-0a75-45d3-9fb7-7e9d953d00a0","block_type":"box","text":"three years of continuous operation if, regarding all such securities, more than 10% of its total assets (taken at","page_number":38,"box":{"x":116,"y":474,"width":764,"height":13}},{"id":"e5b37839-eba7-4b2d-8d9c-d1d3eb2bb0d1","block_type":"box","text":"market value) would be invested in such securities.","page_number":38,"box":{"x":116,"y":490,"width":350,"height":12}},{"id":"aeb0c1c1-81e9-4db0-8107-20f79d6c6f90","block_type":"box","text":"(14) enter into repurchase agreements if, as a result thereof, more than 10% of the Fund’s total assets (taken","page_number":38,"box":{"x":117,"y":513,"width":750,"height":13}},{"id":"da856c36-7e40-426c-9115-5e9307b07955","block_type":"box","text":"at market value at the time of each investment) would be subject to repurchase agreements maturing in more","page_number":38,"box":{"x":116,"y":528,"width":754,"height":13}},{"id":"06771fcf-b630-4d8d-9562-c4e0f282c32c","block_type":"box","text":"than seven days.","page_number":38,"box":{"x":116,"y":544,"width":112,"height":13}},{"id":"17828d73-032f-48fc-8b52-f475f1c6469c","block_type":"box","text":"(15) enter into reverse repurchase agreements if, as","page_number":38,"box":{"x":117,"y":567,"width":350,"height":13}},{"id":"40326d17-ac33-499a-b3b7-811360e9b6f0","block_type":"box","text":"a result thereof, the Fund’s obligations with respect to","page_number":38,"box":{"x":472,"y":567,"width":373,"height":13}},{"id":"a0923a7f-20dd-49f0-bd4f-f5af2847b388","block_type":"box","text":"reverse repurchase agreements would exceed one-third of the Fund’s net assets (defined to be total assets,","page_number":38,"box":{"x":116,"y":583,"width":727,"height":12}},{"id":"be4dcba3-ba03-404a-9fe0-2aa22e8c33e1","block_type":"box","text":"taken at market value, less liabilities other than reverse repurchase agreements).","page_number":38,"box":{"x":116,"y":598,"width":550,"height":13}},{"id":"62454308-93c8-42d6-b559-6e332c235686","block_type":"box","text":"(16) invest more than 25% of its total assets (taken at market value at the time of each investment) in the","page_number":38,"box":{"x":117,"y":621,"width":728,"height":13}},{"id":"4e8ba212-91ef-4d50-ae94-675d12e203d9","block_type":"box","text":"securities of issuers in any particular industry (other than U.S. Government securities, government agency","page_number":38,"box":{"x":116,"y":637,"width":730,"height":13}},{"id":"6ebb40c5-4a0d-45d8-abae-295d6a6a1d09","block_type":"box","text":"securities or bank money instruments).","page_number":38,"box":{"x":116,"y":652,"width":268,"height":13}},{"id":"b1ea673a-3d92-4ccd-a0e7-996a714bb3d5","block_type":"box","text":"Restrictions Applicable to each of the Funds (Except BlackRock 60/40 Target Allocation ETF V.I. Fund,","page_number":38,"box":{"x":116,"y":681,"width":762,"height":13}},{"id":"57806940-e6f3-46fb-a20b-b2c954c1f651","block_type":"box","text":"BlackRock Government Money Market V.I. Fund, BlackRock International Index V.I. Fund and","page_number":38,"box":{"x":116,"y":696,"width":703,"height":13}},{"id":"c9602c86-8602-4bdf-a0b9-4b12aae2d8a7","block_type":"box","text":"BlackRock Small Cap Index V.I. Fund)","page_number":38,"box":{"x":116,"y":712,"width":283,"height":13}},{"id":"c6e4ea6a-8355-4d8f-bd7c-a3be892519a0","block_type":"box","text":"I-20","page_number":38,"box":{"x":485,"y":917,"width":29,"height":9}},{"id":"15443cf0-6ced-4720-8ee8-f81296fff58f","block_type":"box","text":"NM1026U-6004382-38/605","page_number":38,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"978a0e45-7598-4ee6-b380-7f12593dac37","block_type":"box","text":"Under the Funds’ fundamental investment restrictions","page_number":39,"box":{"x":116,"y":79,"width":372,"height":10}},{"id":"161f3ac4-8820-4129-8a08-afc21fa6e2cd","block_type":"box","text":", none of the Funds (unless noted otherwise below) may:","page_number":39,"box":{"x":490,"y":79,"width":389,"height":13}},{"id":"bba23c6e-bc7d-4c96-be69-c3d1c7ea3d5c","block_type":"box","text":"1. Make any investment inconsistent with the Fund’s classification as a diversified company under the","page_number":39,"box":{"x":117,"y":102,"width":704,"height":13}},{"id":"71d6e7fd-3d29-4ea7-8fa7-f787343c85f1","block_type":"box","text":"Investment Company Act.","page_number":39,"box":{"x":116,"y":118,"width":181,"height":12}},{"id":"afce2696-7b8d-4e1d-8b18-2244de7b87dc","block_type":"box","text":"1","page_number":39,"box":{"x":299,"y":118,"width":4,"height":6}},{"id":"1972f7a9-131a-439b-bd89-71c4a8ed4278","block_type":"box","text":"2. Invest more than 25% of its assets, taken at market value, in the securities of issuers in any particular","page_number":39,"box":{"x":116,"y":141,"width":719,"height":13}},{"id":"b1a58f90-7704-4db3-8b9e-aa8f191dc73c","block_type":"box","text":"industry (excluding the U.S. Government and its agencies and instrumentalities).","page_number":39,"box":{"x":116,"y":156,"width":555,"height":13}},{"id":"3cb47dd2-1718-4075-a12c-a9dec7d35b0d","block_type":"box","text":"2","page_number":39,"box":{"x":673,"y":157,"width":5,"height":6}},{"id":"67b6a8d0-7485-4907-957d-0f5996437319","block_type":"box","text":"3. Make investments for the purpose of exercising control or management.","page_number":39,"box":{"x":117,"y":180,"width":517,"height":12}},{"id":"282da9cb-f2c2-46dc-b9f4-acfb898d07a4","block_type":"box","text":"3","page_number":39,"box":{"x":635,"y":180,"width":5,"height":6}},{"id":"06c9365e-83b8-4ca1-9bad-0baa5a5d67d9","block_type":"box","text":"4. Purchase or sell real estate, except that the Fund may invest in securities directly or indirectly secured by","page_number":39,"box":{"x":116,"y":203,"width":738,"height":13}},{"id":"7c0e264e-90e9-4128-add6-9666ec940a4f","block_type":"box","text":"real estate or interests therein or issued by companies which invest in real estate or interests therein.","page_number":39,"box":{"x":116,"y":218,"width":688,"height":13}},{"id":"e0e7f4ad-e721-45c7-8b5a-8ac68a8ea1fa","block_type":"box","text":"5. Make loans to other persons, except that the acquisition of bonds, debentures or other corporate debt","page_number":39,"box":{"x":116,"y":242,"width":724,"height":12}},{"id":"d5266ea9-4197-4387-9156-e1f8b7c89f42","block_type":"box","text":"securities and investment in government obligations, commercial paper, pass-through instruments, certificates","page_number":39,"box":{"x":116,"y":257,"width":760,"height":13}},{"id":"8ff0407d-e0b7-4306-b3c2-c1485e97ad51","block_type":"box","text":"of deposit, bankers acceptances, repurchase agreements","page_number":39,"box":{"x":116,"y":273,"width":384,"height":12}},{"id":"a33776c3-2d4b-49dc-b293-0cbca4acc00d","block_type":"box","text":"or any similar instruments shall not be deemed to be","page_number":39,"box":{"x":505,"y":273,"width":363,"height":12}},{"id":"50bcaaa9-a7a6-40df-963b-cb7893e00db1","block_type":"box","text":"the making of a loan, and except further that the Fund","page_number":39,"box":{"x":116,"y":288,"width":379,"height":13}},{"id":"72174299-2d85-4543-b542-5bc19a1d6553","block_type":"box","text":"may lend its portfolio securities, provided that the","page_number":39,"box":{"x":499,"y":288,"width":346,"height":13}},{"id":"7267e1b4-54c0-4885-a4cf-0544796af35a","block_type":"box","text":"lending of portfolio securities may be made only in accordance with applicable law and the guidelines set","page_number":39,"box":{"x":116,"y":304,"width":728,"height":12}},{"id":"b3ef0440-d737-4a78-90c6-f00687a2b5a5","block_type":"box","text":"forth in the Prospectus and Statement of Additional Information, as they may be amended from time to time.","page_number":39,"box":{"x":116,"y":319,"width":756,"height":13}},{"id":"91358229-8511-43be-9262-80eeaceba5de","block_type":"box","text":"4","page_number":39,"box":{"x":873,"y":320,"width":6,"height":6}},{"id":"ff28f1ed-ca31-4389-8e0b-cf2ca925f5d8","block_type":"box","text":"6. Issue senior securities to the extent such","page_number":39,"box":{"x":117,"y":342,"width":292,"height":10}},{"id":"7fdcbfef-37fa-4d2c-98aa-ad9be90b1902","block_type":"box","text":"issuance would violate applicable law.","page_number":39,"box":{"x":414,"y":342,"width":264,"height":13}},{"id":"7ccf7a01-8d78-4555-b553-e6dbcef6a917","block_type":"box","text":"7. Borrow money, except that (i) the Fund may borrow from banks (as defined in the Investment Company","page_number":39,"box":{"x":117,"y":366,"width":744,"height":12}},{"id":"9ed75c8d-334b-40b6-9cfa-7ca890896ba0","block_type":"box","text":"Act) in amounts up to 33","page_number":39,"box":{"x":116,"y":382,"width":174,"height":12}},{"id":"d8b2a7d4-9760-48ce-96d8-d3a222cbc9ef","block_type":"box","text":"1","page_number":39,"box":{"x":292,"y":382,"width":4,"height":6}},{"id":"e96215c1-2b68-4ccc-af95-e104a208226a","block_type":"box","text":"/","page_number":39,"box":{"x":297,"y":382,"width":5,"height":9}},{"id":"40d31331-fde6-4fe7-958d-20c39617947d","block_type":"box","text":"3","page_number":39,"box":{"x":302,"y":388,"width":4,"height":6}},{"id":"75eb1858-dcf9-4eea-8bb9-a46fd6827f4b","block_type":"box","text":"% of its total assets (including the amount borrowed), (ii) the Fund may borrow","page_number":39,"box":{"x":309,"y":381,"width":555,"height":13}},{"id":"de19ea6e-312c-4f93-b88f-9a159be27bc7","block_type":"box","text":"up to an additional 5% of its total assets for temporary purposes, (iii) the Fund may obtain such short-term","page_number":39,"box":{"x":116,"y":397,"width":745,"height":12}},{"id":"3a057291-2b8a-4374-9059-6a883074a7bd","block_type":"box","text":"credit as may be necessary for the clearance of purchases and sales of portfolio securities and (iv) the Fund","page_number":39,"box":{"x":116,"y":412,"width":736,"height":13}},{"id":"d7b0b9e3-0d44-46c1-91a5-51c9dab3a3a7","block_type":"box","text":"may purchase securities on margin to the extent permitted by applicable law. The Fund may not pledge its","page_number":39,"box":{"x":116,"y":428,"width":736,"height":12}},{"id":"87908c74-ba37-4255-8695-964af1af3032","block_type":"box","text":"assets other than to secure such borrowings or, to the extent permitted by the Fund’s investment policies as set","page_number":39,"box":{"x":116,"y":443,"width":765,"height":13}},{"id":"d7a880c9-6218-43c7-9512-e2f48a991f85","block_type":"box","text":"forth in the Prospectus and Statement of Additional Information, as they may be amended from time to time,","page_number":39,"box":{"x":116,"y":459,"width":756,"height":12}},{"id":"3eac0cf9-e7bb-49af-95d0-07012e943f85","block_type":"box","text":"in connection with hedging transactions, short sales, wh","page_number":39,"box":{"x":116,"y":474,"width":388,"height":13}},{"id":"a0b78103-25ed-41c6-ad0f-30f9557d3899","block_type":"box","text":"en-issued and forward commitment transactions and","page_number":39,"box":{"x":505,"y":474,"width":366,"height":10}},{"id":"43f6310f-78c1-4258-ad24-6bf4dd4eed30","block_type":"box","text":"similar investment strategies.","page_number":39,"box":{"x":116,"y":490,"width":199,"height":12}},{"id":"107001a0-3449-4050-b886-3b146c1cfa5b","block_type":"box","text":"5","page_number":39,"box":{"x":316,"y":490,"width":5,"height":6}},{"id":"8e4b9667-5c9d-48fb-b115-ca6baf5114d9","block_type":"box","text":"8. Underwrite securities of other issuers except insofar as the Fund technically may be deemed an underwriter","page_number":39,"box":{"x":117,"y":513,"width":758,"height":13}},{"id":"199fb132-d919-4056-912e-fd0a86d8d5ad","block_type":"box","text":"under the Securities Act in selling portfolio securities.","page_number":39,"box":{"x":116,"y":528,"width":367,"height":13}},{"id":"03aa7fa4-d2cc-4c90-b871-5f894982ecd9","block_type":"box","text":"9. Purchase or sell commodities or contracts on commodities, except to the extent the Fund may do so in","page_number":39,"box":{"x":116,"y":552,"width":727,"height":12}},{"id":"ae9805eb-0a47-42b3-a040-a14dfabf3e02","block_type":"box","text":"accordance with applicable law and the Prospectus and Statement of Additional Information, as they may be","page_number":39,"box":{"x":116,"y":567,"width":754,"height":13}},{"id":"dbac3a96-3de3-43aa-a381-5e405ca8b2b2","block_type":"box","text":"amended from time to time, and without registering as a commodity pool operator under the Commodity","page_number":39,"box":{"x":116,"y":583,"width":734,"height":12}},{"id":"10cb750e-b22f-407b-93b5-f8137d84bf0d","block_type":"box","text":"Exchange Act.","page_number":39,"box":{"x":116,"y":598,"width":99,"height":13}},{"id":"089d2bbd-3577-4f2f-877d-13d7e4487a44","block_type":"box","text":"1","page_number":39,"box":{"x":128,"y":627,"width":4,"height":4}},{"id":"1186ffaa-4746-4c83-98f7-054e2e3904ef","block_type":"box","text":"Though BlackRock S&P 500 Index V.I. Fund is classified as a diversified investment company under the Investment Company","page_number":39,"box":{"x":146,"y":626,"width":732,"height":10}},{"id":"e70873da-1750-49be-9541-54e0b091723e","block_type":"box","text":"Act, this restriction is not applicable to that Fund because it was formerly classified as a non-diversified investment company","page_number":39,"box":{"x":146,"y":636,"width":721,"height":11}},{"id":"24959c40-a3bb-4099-b3d3-d77c77f9bd65","block_type":"box","text":"under the Investment Company Act.","page_number":39,"box":{"x":146,"y":647,"width":210,"height":10}},{"id":"a1885e64-0454-49ac-8dbd-8dfc6d2512a2","block_type":"box","text":"2","page_number":39,"box":{"x":128,"y":658,"width":4,"height":4}},{"id":"de2f200b-1ae3-4c1a-af92-4ef40e729294","block_type":"box","text":"For purposes of this restriction, states, municipalities and their political subdivisions are not considered to be part of any","page_number":39,"box":{"x":146,"y":657,"width":698,"height":10}},{"id":"db3f6af4-74b8-4ad2-9c31-28393bcfff4b","block_type":"box","text":"industry. For purposes of this restriction, each Fund uses the classifications and sub-classifications of MSCI, Inc. (“MSCI”) as","page_number":39,"box":{"x":146,"y":667,"width":727,"height":11}},{"id":"bab11439-b8e5-42c3-aa76-30fe457a211a","block_type":"box","text":"a guide to identify industries. To the extent that an industry classification or sub-classification is not provided by MSCI,","page_number":39,"box":{"x":147,"y":678,"width":693,"height":10}},{"id":"884a3858-3085-47f7-9d10-45cdca346ea7","block_type":"box","text":"BlackRock Global Allocation V.I. Fund and BlackRock Managed Volatility V.I. Fund may utilize any one or more of the","page_number":39,"box":{"x":146,"y":688,"width":700,"height":10}},{"id":"eebf4445-3196-44f3-899c-3f857aa2c122","block_type":"box","text":"industry classifications or sub-classifications used by one or more other widely recognized market indexes or rating group","page_number":39,"box":{"x":146,"y":698,"width":704,"height":11}},{"id":"4f86620d-8013-41df-9a6c-c6cc8a5d25ab","block_type":"box","text":"indexes, one or more third party providers of industry classifications, and/or as defined by Fund Management. Currently, for","page_number":39,"box":{"x":146,"y":709,"width":724,"height":10}},{"id":"59bee578-6a71-4d73-a8de-d7a990c80b79","block_type":"box","text":"industry classifications or sub-classifications not provided by MSCI, BlackRock Global Allocation V.I. Fund and BlackRock","page_number":39,"box":{"x":146,"y":719,"width":719,"height":10}},{"id":"0932c072-805b-4b55-af22-51050da2049f","block_type":"box","text":"Managed Volatility V.I. Fund use the classifications of Barclays PLC.","page_number":39,"box":{"x":146,"y":729,"width":399,"height":11}},{"id":"676dc4f1-1268-4a29-bdf4-aa10a8f83cd3","block_type":"box","text":"3","page_number":39,"box":{"x":128,"y":740,"width":4,"height":5}},{"id":"e011f546-4625-44c7-b029-e86d2b0aebf7","block_type":"box","text":"In the case of BlackRock Advantage Large Cap Core V.I. Fund, BlackRock Advantage Large Cap Value V.I. Fund, BlackRock","page_number":39,"box":{"x":146,"y":740,"width":731,"height":10}},{"id":"0276979f-579b-4a50-a454-96cd7c715f69","block_type":"box","text":"Advantage SMID Cap V.I. Fund, BlackRock Basic Value V.I. Fund, BlackRock Equity Dividend V.I. Fund, BlackRock Global","page_number":39,"box":{"x":146,"y":750,"width":729,"height":10}},{"id":"a22103eb-cb9e-4f4a-8e92-07bb5563c1ba","block_type":"box","text":"Allocation V.I. Fund, BlackRock International V.I. Fund, BlackRock Large Cap Focus Growth V.I. Fund and BlackRock","page_number":39,"box":{"x":146,"y":760,"width":700,"height":11}},{"id":"2811224a-0d9a-4140-a238-0ef57b722154","block_type":"box","text":"Managed Volatility V.I. Fund investments in wholly-owned investment entities created under the laws of certain countries will","page_number":39,"box":{"x":146,"y":771,"width":731,"height":10}},{"id":"f06337e6-524b-48f9-811a-568b90ba6000","block_type":"box","text":"not be deemed to be the making of investments for the purpose of exercising control or management.","page_number":39,"box":{"x":146,"y":781,"width":585,"height":10}},{"id":"6d9053e7-9f45-4222-b541-445da46d620a","block_type":"box","text":"4","page_number":39,"box":{"x":128,"y":792,"width":4,"height":5}},{"id":"72718ace-ab24-4bab-8549-525ccffe94fb","block_type":"box","text":"With respect to restriction 5, BlackRock International V.I. Fund and BlackRock Large Cap Focus Growth V.I. Fund may also","page_number":39,"box":{"x":146,"y":791,"width":728,"height":11}},{"id":"4d547e03-d8ed-45ab-afb5-bd4bd10ec38f","block_type":"box","text":"make loans as permitted by an exemptive order issued to the Fund by the Securities and Exchange Commission.","page_number":39,"box":{"x":146,"y":802,"width":647,"height":10}},{"id":"6d1aa678-0b20-4715-8641-e7cb748a0cd8","block_type":"box","text":"5","page_number":39,"box":{"x":128,"y":813,"width":4,"height":4}},{"id":"e91bdce4-26d0-4248-a471-d1bda64ce704","block_type":"box","text":"With respect to restriction 7(i), BlackRock International V.I. Fund and BlackRock Large Cap Focus Growth V.I. Fund may","page_number":39,"box":{"x":146,"y":812,"width":714,"height":10}},{"id":"3b5230d5-00ca-495b-ba35-16197f310080","block_type":"box","text":"borrow from entities other than banks.","page_number":39,"box":{"x":147,"y":822,"width":224,"height":8}},{"id":"33dcd565-14ae-4f3c-9d12-f2b7dd569336","block_type":"box","text":"I-21","page_number":39,"box":{"x":485,"y":917,"width":28,"height":9}},{"id":"6b99499f-6600-40ff-9f3c-9276d3b6274b","block_type":"box","text":"NM1026U-6004382-39/605","page_number":39,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"bf78d030-cb29-42e7-b632-0909e061c3ae","block_type":"box","text":"Under the Funds’ non-fundamental investment restric","page_number":40,"box":{"x":116,"y":79,"width":371,"height":10}},{"id":"3926807e-5680-4027-9656-1182ccc1144d","block_type":"box","text":"tions, which may be changed by the Board of Directors","page_number":40,"box":{"x":487,"y":79,"width":383,"height":12}},{"id":"dd021a8c-cc40-4d09-8f21-24d02409fe3e","block_type":"box","text":"without shareholder approval, none of the F","page_number":40,"box":{"x":116,"y":94,"width":307,"height":13}},{"id":"9c16a7c3-ed3d-4c80-a423-80681e3cd868","block_type":"box","text":"unds (unless noted otherwise below) may:","page_number":40,"box":{"x":424,"y":94,"width":289,"height":13}},{"id":"789dad4b-5d4e-44c1-9c06-70d36e51156e","block_type":"box","text":"a. Purchase securities of other investment companies, except to the extent permitted by the Investment Company","page_number":40,"box":{"x":116,"y":116,"width":763,"height":12}},{"id":"b0c6b4c4-33b3-4890-bc4a-f963c0dd0ecf","block_type":"box","text":"Act. As a matter of policy, however, the Fund will not purchase shares of any registered open-end investment","page_number":40,"box":{"x":116,"y":131,"width":739,"height":13}},{"id":"288cdb8c-1276-4745-a016-cc3e8bac5128","block_type":"box","text":"company or registered unit investment trust, in reliance on Section 12(d)(1)(F) or (G) (the “fund of funds”","page_number":40,"box":{"x":116,"y":146,"width":717,"height":13}},{"id":"494c05c9-28c0-4e9e-9224-4356249b94f6","block_type":"box","text":"provisions) of the Investment Company Act, at any time the Fund has knowledge that its shares are purchased","page_number":40,"box":{"x":116,"y":161,"width":746,"height":13}},{"id":"d6293b6e-a374-4089-bb1b-4357a025109a","block_type":"box","text":"by another investment company investor in reliance on the provisions of subparagraph (G) of Section 12(d)(1).","page_number":40,"box":{"x":116,"y":177,"width":749,"height":12}},{"id":"ecb69ca0-464a-4dbb-a6cf-7525d83e9381","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":40,"box":{"x":116,"y":198,"width":735,"height":13}},{"id":"bce5eb1a-b704-4787-af94-4dfb49889a33","block_type":"box","text":"Prospectus and Statement of Additional Information, as amended from time to time, and applicable law.","page_number":40,"box":{"x":116,"y":214,"width":724,"height":12}},{"id":"3845074a-a475-484c-ad0a-b05b8b24cd8c","block_type":"box","text":"Except with respect to restriction 7, (restriction 9 for BlackRock Government Money Market V.I. Fund), if a","page_number":40,"box":{"x":116,"y":235,"width":754,"height":13}},{"id":"7e6cacff-979d-4810-8678-1df2ee2a1e12","block_type":"box","text":"percentage restriction on the investment or use of assets set forth above is adhered to at the time a transaction","page_number":40,"box":{"x":116,"y":251,"width":760,"height":12}},{"id":"0f20552e-0a35-4524-9a76-d0d162f38c77","block_type":"box","text":"is effected, later changes in percentages resulting from changing values will not be considered a violation.","page_number":40,"box":{"x":116,"y":266,"width":726,"height":13}},{"id":"ce218720-f5d8-4008-b7e7-8a726adb9e84","block_type":"box","text":"Each Fund is classified as diversified under the Investment Company Act. This means that the Fund may not","page_number":40,"box":{"x":116,"y":288,"width":751,"height":12}},{"id":"e2e771ca-6c62-4ea6-aae4-087013491037","block_type":"box","text":"purchase securities of an issuer (other than (i) obligati","page_number":40,"box":{"x":116,"y":303,"width":371,"height":13}},{"id":"057b922c-e79c-4692-9e43-cf33d2d22ebe","block_type":"box","text":"ons issued or guaranteed by the U.S. government, its","page_number":40,"box":{"x":488,"y":303,"width":363,"height":13}},{"id":"877346ad-c5ee-424b-b30e-9fd8c2405469","block_type":"box","text":"agencies or instrumentalities and (ii) securities of other investment companies) if, with respect to 75% of its","page_number":40,"box":{"x":116,"y":318,"width":744,"height":13}},{"id":"6a4f2053-ed34-472e-9f0f-bebbcada0979","block_type":"box","text":"total assets, (a) more than 5% of the Fund’s total assets would be invested in securities of that issuer or (b) the","page_number":40,"box":{"x":116,"y":333,"width":763,"height":13}},{"id":"e7b31373-be2e-497b-a8c3-cf593a5e5628","block_type":"box","text":"Fund would hold more than 10% of the outstanding voting securities of that issuer. With respect to the","page_number":40,"box":{"x":116,"y":349,"width":717,"height":12}},{"id":"511e2105-44ee-4854-95b0-124741a16c8d","block_type":"box","text":"remaining 25% of its total assets, the Fund can invest more than 5% of its assets in one issuer. BlackRock","page_number":40,"box":{"x":116,"y":364,"width":735,"height":13}},{"id":"cba9ebf2-d85f-4df2-b0da-9b643cf23d6f","block_type":"box","text":"S&P 500 Index V.I. Fund intends to be diversified in approximately the same proportion as its Underlying","page_number":40,"box":{"x":116,"y":379,"width":737,"height":13}},{"id":"51534f89-b5e5-4695-a5c8-9d513fd42755","block_type":"box","text":"Index (as defined in the Fund’s Prospectus) is diversified. Under the Investment Company Act, a Fund cannot","page_number":40,"box":{"x":116,"y":394,"width":757,"height":13}},{"id":"69d839c6-df54-40d8-9e6f-bc365cc2f80a","block_type":"box","text":"change its classification from diversified to non-diversified without shareholder approval. However, while","page_number":40,"box":{"x":116,"y":410,"width":733,"height":12}},{"id":"54395d67-8809-4a58-ae28-efac0efc459a","block_type":"box","text":"BlackRock S&P 500 Index V.I. Fund is classified as “diversified,” under applicable no-action relief from the","page_number":40,"box":{"x":116,"y":425,"width":750,"height":13}},{"id":"b7dbb5d6-8494-47de-a0bc-3a3315370110","block_type":"box","text":"SEC staff, the Fund may become non-diversified, as defined in the Investment Company Act, solely as a result","page_number":40,"box":{"x":116,"y":440,"width":760,"height":13}},{"id":"a81384f4-0ffb-48f9-b0f5-46a87f46169b","block_type":"box","text":"of a change in relative market capitalization or index weighting of one or more constituents of its Underlying","page_number":40,"box":{"x":116,"y":455,"width":755,"height":13}},{"id":"591702fe-35d4-46a8-a9d9-5f775c6e3119","block_type":"box","text":"Index, and such a change will not require shareholder approval.","page_number":40,"box":{"x":116,"y":471,"width":442,"height":12}},{"id":"00cf2525-0ae8-494c-89b1-4455fb929c29","block_type":"box","text":"The Global Allocation Subsidiary will follow BlackRock Global Allocation V.I. Fund’s fundamental and","page_number":40,"box":{"x":116,"y":492,"width":725,"height":13}},{"id":"8a78efce-c0cd-4e81-bf0c-a7d89714edbb","block_type":"box","text":"non-fundamental investment restrictions, described above, with respect to its investments.","page_number":40,"box":{"x":116,"y":508,"width":621,"height":12}},{"id":"845f15e6-b3d7-443b-8868-e6777b47d1a8","block_type":"box","text":"Restrictions Applicable to each of BlackRock 60/40 Target Allocation ETF V.I. Fund, BlackRock","page_number":40,"box":{"x":116,"y":534,"width":711,"height":12}},{"id":"6bcd9d72-ab0b-46be-a6b7-41845538fb36","block_type":"box","text":"International Index V.I. Fund and BlackRock Small Cap Index V.I. Fund","page_number":40,"box":{"x":116,"y":549,"width":529,"height":13}},{"id":"667270bd-e3b3-4358-9619-efd4d9c3150b","block_type":"box","text":"Under the Funds’ fundamental investment restrictions, none of the Funds may:","page_number":40,"box":{"x":116,"y":573,"width":544,"height":13}},{"id":"9c1f97fe-9979-417b-9b74-780d3aa8d621","block_type":"box","text":"1. Concentrate its investments in a particular industry, as that term is used in the Investment Company Act.","page_number":40,"box":{"x":117,"y":595,"width":744,"height":12}},{"id":"3931ffd3-9ce1-4099-9b17-31756bee4b21","block_type":"box","text":"Except that, with respect to BlackRock International I","page_number":40,"box":{"x":116,"y":610,"width":375,"height":13}},{"id":"43487ed8-e866-4d29-a2ee-a895d74fa040","block_type":"box","text":"ndex V.I. Fund and BlackRock Small Cap Index V.I.","page_number":40,"box":{"x":491,"y":610,"width":364,"height":13}},{"id":"7134381e-9519-4e9a-b157-cabac2f303e2","block_type":"box","text":"Fund, each Fund will concentrate to approximately the sam","page_number":40,"box":{"x":116,"y":625,"width":414,"height":13}},{"id":"71ba4d30-3745-4e46-ab4c-a7ee856f3cff","block_type":"box","text":"e extent that its Underlying Index concentrates in","page_number":40,"box":{"x":531,"y":625,"width":340,"height":13}},{"id":"92cae5bb-be95-4f3c-bdc0-0c68eb4dc880","block_type":"box","text":"the securities of a particular industry or group of industries.","page_number":40,"box":{"x":116,"y":640,"width":412,"height":13}},{"id":"4a56f86b-8eb1-4e16-9702-a8a54d0ea5c1","block_type":"box","text":"2. Borrow money, except as permitted under the Investment Company Act.","page_number":40,"box":{"x":116,"y":662,"width":522,"height":13}},{"id":"9c799130-4333-4673-9579-c6c36528a811","block_type":"box","text":"3. Issue senior securities to the extent such issuance would violate the Investment Company Act.","page_number":40,"box":{"x":117,"y":684,"width":664,"height":13}},{"id":"12be14bd-2aea-48d2-935e-19f62fad65f9","block_type":"box","text":"4. Purchase or hold real estate, except the Fund may purchase and hold securities or other instruments that are","page_number":40,"box":{"x":116,"y":706,"width":767,"height":13}},{"id":"7063799e-6373-403e-a977-bc365e24c2c0","block_type":"box","text":"secured by, or linked to, real estate or interests therein, securities of real estate investment trusts, mortgage","page_number":40,"box":{"x":116,"y":721,"width":741,"height":13}},{"id":"c0bc3eb9-6981-4cdf-9717-5bb6b8be598d","block_type":"box","text":"related securities and securities of issuers engaged in the real estate business, and the Fund may purchase and","page_number":40,"box":{"x":116,"y":736,"width":753,"height":13}},{"id":"f90517e9-a9ce-4222-88f6-adf47858693c","block_type":"box","text":"hold real estate as a result of the ownership of securities or other instruments.","page_number":40,"box":{"x":116,"y":751,"width":537,"height":13}},{"id":"55d1602d-7324-47a4-a558-2c3b7fa405e0","block_type":"box","text":"5. Underwrite securities issued by others, except to the","page_number":40,"box":{"x":116,"y":773,"width":377,"height":13}},{"id":"c5d2b2be-b5e6-46de-a8ef-d3a27defb658","block_type":"box","text":"extent that the sale of portfolio securities by the Fund","page_number":40,"box":{"x":498,"y":773,"width":371,"height":13}},{"id":"271e6934-1598-45ff-8733-b5f29b1506ba","block_type":"box","text":"may be deemed to be an underwriting or as otherwise permitted by applicable law.","page_number":40,"box":{"x":116,"y":788,"width":574,"height":13}},{"id":"bfb38901-8894-4d69-8bb5-4b755ab30833","block_type":"box","text":"6. Purchase or sell commodities or commodity contracts, except as permitted by the Investment Company Act.","page_number":40,"box":{"x":117,"y":810,"width":748,"height":13}},{"id":"9193de40-b82d-4a6e-9aba-a8b130955213","block_type":"box","text":"7. Make loans to the extent prohibited by the Investment Company Act.","page_number":40,"box":{"x":117,"y":832,"width":500,"height":13}},{"id":"30cbe172-2695-4b05-a287-98217ee0abb5","block_type":"box","text":"8. Make any investment inconsistent with the Fund’s classification as a diversified company under the","page_number":40,"box":{"x":117,"y":854,"width":704,"height":13}},{"id":"a948f7e1-d5b8-4fdb-8b02-8a9c27ead073","block_type":"box","text":"Investment Company Act.","page_number":40,"box":{"x":116,"y":870,"width":181,"height":12}},{"id":"44c2c009-d4b4-4a83-b93f-bf2efa964386","block_type":"box","text":"I-22","page_number":40,"box":{"x":485,"y":917,"width":29,"height":9}},{"id":"4eb77173-5104-4607-8aa2-397dd64a8b9e","block_type":"box","text":"NM1026U-6004382-40/605","page_number":40,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"cffe4d5c-f723-418a-81b2-53ad3394a271","block_type":"box","text":"Notations Regarding each of BlackRock 60/40 Target Allocation ETF V.I. Fund’s, BlackRock","page_number":41,"box":{"x":115,"y":79,"width":687,"height":13}},{"id":"643a2486-aaa6-4748-bd0f-90f7753a4785","block_type":"box","text":"International Index V.I. Fund’s and BlackRock Small Cap Index V.I. Fund’s Fundamental Investment","page_number":41,"box":{"x":116,"y":94,"width":752,"height":13}},{"id":"d8229f0d-341d-4b14-bd52-134df25017cb","block_type":"box","text":"Restrictions","page_number":41,"box":{"x":116,"y":110,"width":86,"height":10}},{"id":"d6109d12-7214-446e-80dc-5bd2327f2ae5","block_type":"box","text":"The following notations are not considered to be part of a Fund’s fundamental investment restrictions and are","page_number":41,"box":{"x":116,"y":135,"width":763,"height":13}},{"id":"9ced2ce8-4a6a-494a-9c96-fb6dfc8df998","block_type":"box","text":"subject to change without shareholder approval.","page_number":41,"box":{"x":116,"y":150,"width":334,"height":13}},{"id":"0ce9376f-b006-4332-89ec-694002ce6952","block_type":"box","text":"With respect to the fundamental policy relating to concentration set forth in (1) above, the Investment","page_number":41,"box":{"x":116,"y":173,"width":724,"height":13}},{"id":"717da258-c7f4-443e-ace5-d9c234ca14d3","block_type":"box","text":"Company Act does not define what constitutes “concentration” in an industry. The Commission staff has","page_number":41,"box":{"x":117,"y":188,"width":749,"height":13}},{"id":"d496e560-d882-4ca7-a01f-7a1ebec08b1f","block_type":"box","text":"taken the position that investment of 25% or more of a fund’s total assets in one or more issuers","page_number":41,"box":{"x":116,"y":204,"width":686,"height":13}},{"id":"bf7ee79a-b5ab-49d4-bf3a-71008606d057","block_type":"box","text":"conducting their principal activities in the same industry or group of industries constitutes concentration. It","page_number":41,"box":{"x":116,"y":219,"width":760,"height":13}},{"id":"2485b487-789e-4bcb-b73f-93599fb7ae2f","block_type":"box","text":"is possible that interpretations of concentration could change in the future. The policy in (1) above will be","page_number":41,"box":{"x":116,"y":235,"width":751,"height":13}},{"id":"333ad1b2-b1fc-46bb-8be6-4a5a0063016d","block_type":"box","text":"interpreted to refer to concentration as that term may be interpreted from time to time. The policy also will","page_number":41,"box":{"x":116,"y":250,"width":761,"height":13}},{"id":"01eb25df-9912-4741-859e-5cb58aab22a0","block_type":"box","text":"be interpreted to permit investment without limit in th","page_number":41,"box":{"x":116,"y":266,"width":386,"height":13}},{"id":"bd8a8044-2ffe-4156-b133-e260d3368dc7","block_type":"box","text":"e following: securities of the U.S. government and its","page_number":41,"box":{"x":502,"y":266,"width":374,"height":13}},{"id":"714ba0b1-22f4-4a60-915d-dda97d404552","block_type":"box","text":"agencies or instrumentalities; securities of state, territory, possession or municipal governments and their","page_number":41,"box":{"x":116,"y":281,"width":742,"height":13}},{"id":"6763f965-5389-4233-a9a2-bef82de379b0","block_type":"box","text":"authorities, agencies, instrumentalities or political subdivisions; and repurchase agreements collateralized by","page_number":41,"box":{"x":116,"y":297,"width":766,"height":13}},{"id":"b203160e-000f-4b25-9ca0-cc49c9101165","block_type":"box","text":"any such obligations. Accordingly, issuers of the foregoing securities will not be considered to be members","page_number":41,"box":{"x":116,"y":312,"width":753,"height":13}},{"id":"bee83923-bb12-4f98-b374-cf5a035f35dd","block_type":"box","text":"of any industry. There also will be no limit on investment in issuers domiciled in a single jurisdiction or","page_number":41,"box":{"x":116,"y":328,"width":732,"height":13}},{"id":"85331d4a-aa1b-40f1-b2ae-6582c22f4ae0","block_type":"box","text":"country. Finance companies will be considered to be in the industries of their parents if their activities are","page_number":41,"box":{"x":116,"y":343,"width":748,"height":13}},{"id":"aad34bda-67e0-426c-a9c0-0f77d57b1d09","block_type":"box","text":"primarily related to financing the activities of the parents. Each foreign government will be considered to be","page_number":41,"box":{"x":116,"y":359,"width":764,"height":13}},{"id":"dc4a5ab0-3140-47ce-9767-63d3c9eada00","block_type":"box","text":"a member of a separate industry. With respect to the Fund’s industry classifications, the Fund currently","page_number":41,"box":{"x":116,"y":374,"width":732,"height":13}},{"id":"8cea61c4-fb47-4367-9784-e0c2391c4ed4","block_type":"box","text":"utilizes any one or more of the industry sub-classifications used by one or more widely recognized market","page_number":41,"box":{"x":116,"y":390,"width":749,"height":13}},{"id":"d6d4cba5-c6e5-48d2-b005-419574260d9c","block_type":"box","text":"indexes or rating group indexes, and/or as defined by Fund management. The policy also will be interpreted","page_number":41,"box":{"x":116,"y":405,"width":766,"height":13}},{"id":"7557cab0-0be6-47ca-b8f9-dc0c9a7ee7e8","block_type":"box","text":"to give broad authority to the Fund as to how to classify issuers within or among industries. With respect to","page_number":41,"box":{"x":116,"y":421,"width":766,"height":13}},{"id":"b6094958-9145-4228-b2a1-182c22665336","block_type":"box","text":"BlackRock 60/40 Target Allocation ETF V.I. Fund, the Fund may invest in underlying funds that may","page_number":41,"box":{"x":116,"y":436,"width":723,"height":13}},{"id":"512773a5-1f99-4117-831c-59665facae1a","block_type":"box","text":"concentrate their assets in one or more industries. BlackRock 60/40 Target Allocation ETF V.I. Fund will","page_number":41,"box":{"x":116,"y":452,"width":747,"height":13}},{"id":"53f6db53-afed-41ed-9665-22359359612a","block_type":"box","text":"consider the concentration of the underlying funds in determining compliance with the Fund’s","page_number":41,"box":{"x":116,"y":467,"width":666,"height":13}},{"id":"b07fb414-e29d-46bb-a83d-c703872de886","block_type":"box","text":"concentration policy.","page_number":41,"box":{"x":116,"y":483,"width":149,"height":13}},{"id":"2abcde1f-386a-41d0-8aad-e34be205c7e4","block_type":"box","text":"With respect to the fundamental policy relating to borrowing money set forth in (2) above, the Investment","page_number":41,"box":{"x":116,"y":506,"width":736,"height":12}},{"id":"2022b5b6-4cb0-4d37-b938-5af011b62428","block_type":"box","text":"Company Act permits the Fund to borrow money in amounts of up to one third of the Fund’s total assets","page_number":41,"box":{"x":117,"y":521,"width":730,"height":13}},{"id":"e13fc397-bddc-4afe-805c-760c0617bc0b","block_type":"box","text":"from banks for any purpose, and to borrow up to 5% of the Fund’s total assets from banks or other lenders","page_number":41,"box":{"x":116,"y":537,"width":749,"height":12}},{"id":"d5f4d9aa-9373-4872-88de-f5ca5dbea1e8","block_type":"box","text":"for temporary purposes. (The Fund’s total assets include the amounts being borrowed.) To limit the risks","page_number":41,"box":{"x":116,"y":552,"width":728,"height":13}},{"id":"ecffb00e-be58-425b-8bba-b09463903c0d","block_type":"box","text":"attendant to borrowing, the Investment Company Act requires the Fund to maintain at all times an “asset","page_number":41,"box":{"x":116,"y":568,"width":734,"height":12}},{"id":"997b58e0-7875-468a-9a60-30493b18e076","block_type":"box","text":"coverage” of at least 300% of the amount of its borrowings. Asset coverage means the ratio that the value of","page_number":41,"box":{"x":116,"y":583,"width":757,"height":13}},{"id":"e2fce44f-95d3-474d-bf80-8ab4a3ecce9a","block_type":"box","text":"the Fund’s total assets (including amounts borrowed), m","page_number":41,"box":{"x":116,"y":599,"width":391,"height":12}},{"id":"9794af9a-1afb-4315-8e3f-d7b750c70d45","block_type":"box","text":"inus liabilities other than borrowings, bears to the","page_number":41,"box":{"x":508,"y":599,"width":345,"height":12}},{"id":"79142a96-d332-41aa-9b04-a713881325de","block_type":"box","text":"aggregate amount of all borrowings. Borrowing money to increase portfolio holdings is known as","page_number":41,"box":{"x":116,"y":614,"width":678,"height":13}},{"id":"92457f22-cb84-467a-a96d-8800c7acff71","block_type":"box","text":"“leveraging.” Certain trading practices and investments, such as reverse repurchase agreements, may be","page_number":41,"box":{"x":117,"y":630,"width":716,"height":12}},{"id":"ae2511cf-1c54-46f0-acd9-cfedef8291c4","block_type":"box","text":"considered to be borrowings or involve leverage and thus are subject to the Investment Company Act","page_number":41,"box":{"x":116,"y":645,"width":702,"height":13}},{"id":"811cfcd3-05df-4b4d-adf1-4de235bd167d","block_type":"box","text":"restrictions. In accordance with Rule 18f-4 under the Investment Company Act, when the Fund engages in","page_number":41,"box":{"x":116,"y":661,"width":738,"height":12}},{"id":"d148657c-e0bd-4f5f-9bc1-e0024b17700e","block_type":"box","text":"reverse repurchase agreements and similar financing tr","page_number":41,"box":{"x":116,"y":676,"width":377,"height":13}},{"id":"14e893a5-c62c-4dc6-b369-b0fa30510316","block_type":"box","text":"ansactions, the Fund may either (i) maintain asset","page_number":41,"box":{"x":493,"y":676,"width":344,"height":13}},{"id":"c8cc1015-aee9-4b9c-b92b-6d23d9b684ea","block_type":"box","text":"coverage of at least 300% with respect to such transactions and any other borrowings in the aggregate, or (ii)","page_number":41,"box":{"x":116,"y":692,"width":758,"height":12}},{"id":"6fd10321-5c41-43d0-a6ab-50af2fff6123","block_type":"box","text":"treat such transactions as “derivatives transactions” and comply with Rule 18f-4 with respect to such","page_number":41,"box":{"x":116,"y":707,"width":703,"height":13}},{"id":"4a9ee36e-393d-4e81-a86f-034ae96aa12c","block_type":"box","text":"transactions. Short-term credits necessary for the settlement of securities transactions and arrangements with","page_number":41,"box":{"x":116,"y":723,"width":753,"height":12}},{"id":"2f465602-0456-473f-82bb-211f0d246e73","block_type":"box","text":"respect to securities lending will not be considered to be borrowings under the policy. Practices and","page_number":41,"box":{"x":116,"y":738,"width":687,"height":13}},{"id":"69a684bb-0fde-47f5-8a8e-12f539d47208","block_type":"box","text":"investments that may involve leverage but are not considered to be borrowings are not subject to the policy.","page_number":41,"box":{"x":116,"y":754,"width":747,"height":12}},{"id":"6457a73f-503d-41d5-9715-8ef2b044e56b","block_type":"box","text":"With respect to the fundamental policy relating to underwriting set forth in (5) above, the Investment","page_number":41,"box":{"x":116,"y":776,"width":702,"height":13}},{"id":"354e8f39-f8a2-4205-a318-83a9c2d873c1","block_type":"box","text":"Company Act does not prohibit the Fund from engaging in the underwriting business or from underwriting","page_number":41,"box":{"x":117,"y":792,"width":744,"height":13}},{"id":"f36d1568-3d12-4f02-afe3-48467677e57b","block_type":"box","text":"the securities of other issuers; in fact, in the case of diversified funds, the Investment Company Act permits the","page_number":41,"box":{"x":116,"y":807,"width":763,"height":13}},{"id":"7a8cbeb4-b383-4d2a-87cb-25c0f5f4c128","block_type":"box","text":"Fund to have underwriting commitments of up to 25% of its assets under certain circumstances. Those","page_number":41,"box":{"x":116,"y":823,"width":715,"height":13}},{"id":"c1035430-2455-4636-9541-745d6e0a6ee5","block_type":"box","text":"circumstances currently are that the amount of the Fund’s underwriting commitments, when added to the","page_number":41,"box":{"x":116,"y":838,"width":732,"height":13}},{"id":"b4e1ed54-2429-4941-b1eb-18fd9a288cd6","block_type":"box","text":"value of the Fund’s investments in issuers where the Fund owns more than 10% of the outstanding voting","page_number":41,"box":{"x":116,"y":854,"width":734,"height":13}},{"id":"8860a020-73df-4ebf-a0e6-5baabcb47c50","block_type":"box","text":"securities of those issuers, cannot exceed the 25% cap. A fund engaging in transactions involving the","page_number":41,"box":{"x":116,"y":869,"width":697,"height":13}},{"id":"9de3643d-008a-4ace-9cfe-43822cb9bbf4","block_type":"box","text":"I-23","page_number":41,"box":{"x":485,"y":917,"width":28,"height":9}},{"id":"411a87e4-00c9-49e4-9ef7-f1289ba4beec","block_type":"box","text":"NM1026U-6004382-41/605","page_number":41,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"882807c1-17c4-40d2-b1b0-bb1017a236b8","block_type":"box","text":"acquisition or disposition of portfolio securities may be considered to be an underwriter under the Securities","page_number":42,"box":{"x":116,"y":79,"width":748,"height":13}},{"id":"13b40820-5891-48c0-9a6b-673a2f99ce7b","block_type":"box","text":"Act. Although it is not believed that the application of the Securities Act provisions described above would","page_number":42,"box":{"x":116,"y":94,"width":738,"height":13}},{"id":"e27014d0-13f8-4a5d-9c1b-04e8bf2f3af7","block_type":"box","text":"cause the Fund to be engaged in the business of underwriting, the policy in (5) above will be interpreted not to","page_number":42,"box":{"x":116,"y":110,"width":764,"height":13}},{"id":"df6fcfb0-aa25-4fb6-94f8-3a6e882c1de5","block_type":"box","text":"prevent the Fund from engaging in transactions involving the acquisition or disposition of portfolio securities,","page_number":42,"box":{"x":116,"y":125,"width":759,"height":13}},{"id":"723748fb-2bea-423c-a752-90d2ed464ada","block_type":"box","text":"regardless of whether the Fund may be considered to be an underwriter under the Securities Act or is","page_number":42,"box":{"x":116,"y":141,"width":698,"height":13}},{"id":"d4dfb98a-87fb-44d1-b41f-f328aee0d464","block_type":"box","text":"otherwise engaged in the underwriting business to the extent permitted by applicable law.","page_number":42,"box":{"x":116,"y":156,"width":621,"height":13}},{"id":"0c60365a-9226-4256-bf92-0c3d358a3df1","block_type":"box","text":"With respect to the fundamental policy relating to lending set forth in (7) above, the Investment Company Act","page_number":42,"box":{"x":116,"y":180,"width":764,"height":12}},{"id":"a64bc1a9-cdab-4de6-8009-e2bdc5e5c38d","block_type":"box","text":"does not prohibit the Fund from making loans (includi","page_number":42,"box":{"x":116,"y":195,"width":379,"height":13}},{"id":"a2222952-ff71-49fb-921f-45108a4e9602","block_type":"box","text":"ng lending its securities); however, Commission staff","page_number":42,"box":{"x":495,"y":195,"width":365,"height":13}},{"id":"43c347b9-a86c-4fc8-bdd1-4321f61225be","block_type":"box","text":"interpretations currently prohibit funds from lending more than one-third of their total assets (including","page_number":42,"box":{"x":116,"y":211,"width":720,"height":12}},{"id":"c56a0629-67cc-4aa4-afee-8de36f428459","block_type":"box","text":"lending its securities), except through the purchase of debt obligations or the use of repurchase agreements. In","page_number":42,"box":{"x":116,"y":226,"width":760,"height":13}},{"id":"a2211259-bcbc-4776-bccb-786bf632384a","block_type":"box","text":"addition, collateral arrangements with respect to options, fo","page_number":42,"box":{"x":116,"y":242,"width":408,"height":12}},{"id":"3c1fe0b7-a105-40ff-aee9-ba560207cbec","block_type":"box","text":"forward currency and futures transactions and other","page_number":42,"box":{"x":524,"y":242,"width":357,"height":12}},{"id":"55d54d25-7657-4269-b2e0-9c629075b01c","block_type":"box","text":"derivative instruments (as applicable), as well as delays in the settlement of securities transactions, will not be","page_number":42,"box":{"x":116,"y":257,"width":756,"height":13}},{"id":"cc42c5aa-fb39-476e-9420-8915824b89f5","block_type":"box","text":"considered loans.","page_number":42,"box":{"x":116,"y":273,"width":119,"height":10}},{"id":"60292eac-21ae-44e0-b548-86aa7bb6d604","block_type":"box","text":"The Fund is currently classified as a diversified fund under the Investment Company Act. This means that the","page_number":42,"box":{"x":116,"y":296,"width":757,"height":13}},{"id":"b7a0df9e-cb53-46d7-9de6-7c98bb1e3858","block_type":"box","text":"Fund may not purchase securities of an issuer (other than (i) obligations issued or guaranteed by the U.S.","page_number":42,"box":{"x":116,"y":311,"width":725,"height":13}},{"id":"26e0f977-1083-4ff5-8f3a-76962a815ed8","block_type":"box","text":"government, its agencies or instrumentalities and (ii)","page_number":42,"box":{"x":116,"y":327,"width":361,"height":13}},{"id":"92074761-f6b6-46d2-9ed0-3f749b2ca11a","block_type":"box","text":"securities of other investment companies) if, with respect","page_number":42,"box":{"x":483,"y":327,"width":392,"height":13}},{"id":"aa5fb1f7-2818-4979-8e9d-d1638be621a7","block_type":"box","text":"to 75% of its total assets, (a) more than 5% of the Fund’s total assets would be invested in securities of that","page_number":42,"box":{"x":116,"y":342,"width":747,"height":13}},{"id":"a8b3af25-3841-4707-a554-3c65768343d6","block_type":"box","text":"issuer or (b) the Fund would hold more than 10% of the outstanding voting securities of that issuer. With","page_number":42,"box":{"x":116,"y":358,"width":733,"height":13}},{"id":"78217d37-02a0-4b42-9c4d-51abfb4e7a89","block_type":"box","text":"respect to the remaining 25% of its total assets, the Fund can invest more than 5% of its assets in one issuer.","page_number":42,"box":{"x":116,"y":373,"width":751,"height":13}},{"id":"47316aaf-151a-4e7c-a553-24bf2cb77f6b","block_type":"box","text":"Under the Investment Company Act, the Fund cannot change its classification from diversified to","page_number":42,"box":{"x":116,"y":389,"width":672,"height":13}},{"id":"961293a8-9d8b-43dc-97bb-333eb418e0d9","block_type":"box","text":"non-diversified without shareholder approval (including, with respect to BlackRock International Index V.I.","page_number":42,"box":{"x":116,"y":404,"width":748,"height":13}},{"id":"69b40d3d-b2cb-4f63-bb78-08f35c4196ee","block_type":"box","text":"Fund and BlackRock Small Cap Index V.I. Fund, class approval by preferred shareholders, if any).","page_number":42,"box":{"x":116,"y":420,"width":682,"height":13}},{"id":"ac1aa11c-0cd8-4169-9afc-fb1aaab26b49","block_type":"box","text":"Under its non-fundamental investment restrictions, w","page_number":42,"box":{"x":116,"y":443,"width":370,"height":12}},{"id":"05893ccf-30b6-40ad-b4c3-b0bce4441bf5","block_type":"box","text":"hich may be changed by the Board without shareholder","page_number":42,"box":{"x":486,"y":443,"width":385,"height":13}},{"id":"46603b07-729c-43c7-b601-c84bdc7d7d68","block_type":"box","text":"approval, each of BlackRock 60/40 Target Allocation ETF V.I. Fund, BlackRock International Index V.I.","page_number":42,"box":{"x":116,"y":459,"width":729,"height":12}},{"id":"b32ad2f7-e02b-4a76-a227-8f7822044a74","block_type":"box","text":"Fund and BlackRock Small Cap Index V.I. Fund may not:","page_number":42,"box":{"x":116,"y":474,"width":402,"height":13}},{"id":"004c53a1-e487-46b6-8774-fe4edcc780db","block_type":"box","text":"a. Purchase securities of other investment companies, except to the extent permitted by the Investment Company","page_number":42,"box":{"x":116,"y":497,"width":762,"height":13}},{"id":"f152c25f-0638-476c-8a0b-3e61fcd79f56","block_type":"box","text":"Act. As a matter of policy, however, the Fund will not purchase shares of any registered open-end investment","page_number":42,"box":{"x":116,"y":513,"width":738,"height":13}},{"id":"9c27de86-5a78-4e42-929f-1401895e1238","block_type":"box","text":"company or registered unit investment trust, in reliance on Section 12(d)(1)(F) or (G) (the “fund of funds”","page_number":42,"box":{"x":116,"y":528,"width":716,"height":13}},{"id":"f6c0bca7-e834-4939-909b-a405d4d9817a","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":42,"box":{"x":116,"y":544,"width":767,"height":13}},{"id":"6ad92133-2dad-4de8-b2ce-0307745d143f","block_type":"box","text":"another investment company investor in reliance on the provisions of subparagraph (G) of Section 12(d)(1).","page_number":42,"box":{"x":116,"y":559,"width":728,"height":13}},{"id":"c5544ba8-f7be-467e-b0ab-73b9c3891ee3","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":42,"box":{"x":116,"y":583,"width":735,"height":12}},{"id":"076fa207-0d02-403b-ad42-e3994fd37cb5","block_type":"box","text":"Prospectus and SAI, as amended from time to time, and applicable law.","page_number":42,"box":{"x":116,"y":598,"width":494,"height":13}},{"id":"3a0e0d16-8a1a-4574-8a45-058421a4ba02","block_type":"box","text":"Unless otherwise indicated, all limitations under t","page_number":42,"box":{"x":116,"y":621,"width":342,"height":13}},{"id":"100ff6b3-0306-41d7-9422-56003587f99f","block_type":"box","text":"he Fund’s fundamental or non-fundamental investment","page_number":42,"box":{"x":459,"y":621,"width":383,"height":10}},{"id":"274d331e-0a87-427c-851d-3cbf996de236","block_type":"box","text":"restrictions apply only at the time that a transaction is undertaken. Any change in the percentage of the Fund’s","page_number":42,"box":{"x":116,"y":637,"width":765,"height":13}},{"id":"e8613ba4-d3b4-4eb3-b824-5d0d7ee57051","block_type":"box","text":"assets invested in certain securities or other instruments resulting from market fluctuations or other changes in","page_number":42,"box":{"x":116,"y":652,"width":764,"height":13}},{"id":"4c49fd45-db2d-4fc5-8578-b51392fab7dc","block_type":"box","text":"the Fund’s total assets will not require the Fund to dispose of an investment until BlackRock determines that it","page_number":42,"box":{"x":116,"y":668,"width":766,"height":13}},{"id":"8e54d0f8-7b15-441d-9c63-879a07baf6fb","block_type":"box","text":"is practicable to sell or close out the investment without undue market or tax consequences.","page_number":42,"box":{"x":116,"y":683,"width":635,"height":13}},{"id":"05801e0f-b48b-4244-9355-c03200197a89","block_type":"box","text":"III. Information on Directors and Officers","page_number":42,"box":{"x":116,"y":712,"width":344,"height":10}},{"id":"17e5041b-fb7c-41a6-9e7f-9059bab4d976","block_type":"box","text":"The Board consists of thirteen individuals (each, a “","page_number":42,"box":{"x":116,"y":738,"width":358,"height":12}},{"id":"33bcc1e1-53c1-4435-964b-223c1ecae7f0","block_type":"box","text":"Director”), eleven of whom are not “interested persons”","page_number":42,"box":{"x":476,"y":738,"width":390,"height":12}},{"id":"a3fc6c19-e466-4e38-b0c8-afaeeda44f60","block_type":"box","text":"of the Company as defined in the Investment Company Act (the “Independent Directors”). The registered","page_number":42,"box":{"x":116,"y":753,"width":733,"height":13}},{"id":"3eb681d4-1851-4781-9bda-6a87c41e5755","block_type":"box","text":"investment companies advised by the Manager or its affiliates (the “BlackRock-advised Funds”) are organized","page_number":42,"box":{"x":116,"y":769,"width":763,"height":13}},{"id":"5d2e606a-ddad-4547-9f75-91b80d85f56a","block_type":"box","text":"into the BlackRock Multi-Asset Complex, the BlackRock Fixed-Income Complex, and the iShares Complex","page_number":42,"box":{"x":116,"y":784,"width":748,"height":13}},{"id":"714384c4-7d0e-4d8a-8af8-8f116fa55bf7","block_type":"box","text":"(each, a “BlackRock Fund Complex”). The Company i","page_number":42,"box":{"x":117,"y":800,"width":381,"height":13}},{"id":"3c236dc7-8a14-446d-af6b-34496727ac50","block_type":"box","text":"s included in the BlackRock Fund Complex referred to","page_number":42,"box":{"x":499,"y":800,"width":379,"height":13}},{"id":"90770dae-4812-47fa-baef-e093a4f9e40b","block_type":"box","text":"as the BlackRock Multi-Asset Complex. The Directors also oversee as board members the operations of the","page_number":42,"box":{"x":116,"y":815,"width":746,"height":13}},{"id":"20e828c3-9010-444d-ae6a-fcdc05517b7e","block_type":"box","text":"other open-end registered investment companies included in the BlackRock Multi-Asset Complex.","page_number":42,"box":{"x":116,"y":831,"width":679,"height":13}},{"id":"db0878fe-048c-4f9d-a370-494e22819062","block_type":"box","text":"The Board has overall responsibility for the oversight of the Company and each Fund. The Chair of the Board","page_number":42,"box":{"x":116,"y":854,"width":763,"height":13}},{"id":"84518c18-b5f0-4602-bb1e-258ee475b3ea","block_type":"box","text":"is an Independent Director, and the Chair of each Board committee (each, a “Committee”) is an Independent","page_number":42,"box":{"x":116,"y":869,"width":757,"height":13}},{"id":"bf3a1331-73fb-4817-baf1-a59c5c25268a","block_type":"box","text":"I-24","page_number":42,"box":{"x":485,"y":917,"width":29,"height":9}},{"id":"bcbf09e8-f43a-4bfd-91fe-f682b0afa239","block_type":"box","text":"NM1026U-6004382-42/605","page_number":42,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"3da238f0-c62b-4627-bffa-a755882f189d","block_type":"box","text":"Director. The Board has five standing Committees: an Audit Committee, a Governance and Nominating","page_number":43,"box":{"x":116,"y":79,"width":724,"height":13}},{"id":"58b38646-e4ea-4ac0-8753-490e1e0bb30b","block_type":"box","text":"Committee, a Compliance Committee, a Performance Oversight Committee and an Ad Hoc Topics","page_number":43,"box":{"x":117,"y":94,"width":688,"height":13}},{"id":"f284a9d5-6c13-478f-9a40-8cea7e1a3a56","block_type":"box","text":"Committee. The role of the Chair of the Board is to preside at all meetings of the Board and to act as a liaison","page_number":43,"box":{"x":117,"y":110,"width":760,"height":13}},{"id":"8b64029e-7cf7-4e63-a377-8d6dce74a14f","block_type":"box","text":"with service providers, officers, attorneys and other Directors generally between meetings. The Chair of each","page_number":43,"box":{"x":116,"y":125,"width":753,"height":13}},{"id":"1a3dd856-dfab-435e-ab38-4666d9c92a5a","block_type":"box","text":"Committee performs a similar role with respect to the Committee. The Chair of the Board or the Chair of a","page_number":43,"box":{"x":117,"y":141,"width":744,"height":13}},{"id":"363af461-3457-4ec4-94bb-6bdacb394b09","block_type":"box","text":"Committee may also perform such other functions as may be delegated by the Board or the Committee from","page_number":43,"box":{"x":117,"y":156,"width":752,"height":13}},{"id":"75044ccb-ce07-4e0e-99b0-72a11cd55ca8","block_type":"box","text":"time to time. The Independent Directors meet regularly outside the presence of Fund management, in","page_number":43,"box":{"x":116,"y":172,"width":701,"height":13}},{"id":"dc136b94-b29f-4df0-b0f5-fb392b0f9b0b","block_type":"box","text":"executive session or with other service providers to each Fund. The Board has regular meetings five times a","page_number":43,"box":{"x":116,"y":187,"width":740,"height":13}},{"id":"a4ebed53-f6f3-4e72-99e2-0967893f6fff","block_type":"box","text":"year, and may hold special meetings if required before its next regular meeting. Each Committee meets","page_number":43,"box":{"x":116,"y":203,"width":711,"height":13}},{"id":"f76e2e7b-18b1-4084-8774-bd64b7b76139","block_type":"box","text":"regularly to conduct the oversight functions delegated to that Committee by the Board and reports its findings","page_number":43,"box":{"x":116,"y":218,"width":762,"height":13}},{"id":"1a706df1-3fb6-4fe3-84d1-4c7431c52339","block_type":"box","text":"to the Board. The Board and each standing Committee conduct annual assessments of their oversight function","page_number":43,"box":{"x":116,"y":234,"width":764,"height":13}},{"id":"d9e4e0eb-1675-423a-aed7-5d46ace5cbc3","block_type":"box","text":"and structure. The Board has determined that the Board’s","page_number":43,"box":{"x":116,"y":249,"width":399,"height":10}},{"id":"0b629e85-a05f-44c5-ad2d-ca1ca3245d61","block_type":"box","text":"leadership structure is appropriate because it allows","page_number":43,"box":{"x":520,"y":249,"width":358,"height":13}},{"id":"37519c72-cdf2-4061-b4d7-4bf06f648216","block_type":"box","text":"the Board to exercise independent judgment over management and to allocate areas of responsibility among","page_number":43,"box":{"x":116,"y":265,"width":748,"height":13}},{"id":"3a25ae2a-d04a-4ef6-9e40-f74a099c8b10","block_type":"box","text":"Committees and the full Board to enhance effective oversight.","page_number":43,"box":{"x":117,"y":280,"width":425,"height":13}},{"id":"d051743f-4b20-4f92-8b78-b0b42d745a43","block_type":"box","text":"The Board has engaged the Manager to manage each Fund on a day-to-day basis. The Board is responsible for","page_number":43,"box":{"x":116,"y":304,"width":757,"height":12}},{"id":"fa6c7526-6acb-4c47-8e10-6aab43304cb3","block_type":"box","text":"overseeing the Manager, other service providers, the operations of each Fund and associated risks in accordance","page_number":43,"box":{"x":116,"y":319,"width":767,"height":13}},{"id":"08844031-1bed-45d8-8ceb-f6d3e0e7fe74","block_type":"box","text":"with the provisions of the Investment Company Act, state law, other applicable laws, the Company’s charter,","page_number":43,"box":{"x":116,"y":335,"width":748,"height":12}},{"id":"dbfc82b9-5ca0-4583-a394-daeebaee1dcd","block_type":"box","text":"and each Fund’s investment objective and strategies. The Board reviews, on an ongoing basis, each Fund’s","page_number":43,"box":{"x":116,"y":350,"width":725,"height":13}},{"id":"0d7d725e-b86b-4aa4-9895-55c4114dabcd","block_type":"box","text":"performance, operations and investment strategies and techniques. The Board also conducts reviews of the","page_number":43,"box":{"x":116,"y":366,"width":729,"height":12}},{"id":"f7336c02-93c5-4f20-8941-0477dd2dc8a8","block_type":"box","text":"Manager and its role in running the operations of each Fund.","page_number":43,"box":{"x":116,"y":381,"width":418,"height":13}},{"id":"9881fb1d-d00e-41b1-8da6-b31d4c248bc4","block_type":"box","text":"Day-to-day risk management with respect to each Fund is the responsibility of the Manager or of sub-advisers","page_number":43,"box":{"x":116,"y":404,"width":763,"height":13}},{"id":"910e92f1-8efa-4437-a94e-34e79367ea12","block_type":"box","text":"or other service providers (depending on the nature of the risk), subject to the supervision of the Manager.","page_number":43,"box":{"x":116,"y":420,"width":736,"height":13}},{"id":"b972ec03-9b53-41ce-8625-8b39f431d9db","block_type":"box","text":"Each Fund is subject to a number of risks, including investment, compliance, operational and valuation risks,","page_number":43,"box":{"x":116,"y":435,"width":756,"height":13}},{"id":"abd8ee09-936f-4a9b-a475-1cfb1a5685bf","block_type":"box","text":"among others. While there are a number of risk management functions performed by the Manager and the","page_number":43,"box":{"x":116,"y":451,"width":740,"height":13}},{"id":"abf44b65-b0d8-4c6d-b04f-8480b556f13c","block_type":"box","text":"sub-advisers or other service providers, as applicable, it is not possible to eliminate all of the risks applicable","page_number":43,"box":{"x":116,"y":466,"width":748,"height":13}},{"id":"b2e09133-cbbb-4344-a29e-3f79c9268f1e","block_type":"box","text":"to the Funds. Risk oversight forms part of the Board’s general oversight of each Fund and is addressed as part","page_number":43,"box":{"x":116,"y":482,"width":761,"height":13}},{"id":"2971509b-1b49-47d4-99a8-26a5f773cefe","block_type":"box","text":"of various Board and Committee activities. The Board, directly or through a Committee, also reviews reports","page_number":43,"box":{"x":116,"y":497,"width":756,"height":13}},{"id":"796a8646-6c4b-49f5-b02e-21466ca185cd","block_type":"box","text":"from, among others, management, the independent registered public accounting firm for each Fund,","page_number":43,"box":{"x":116,"y":513,"width":693,"height":13}},{"id":"ae71995d-8b1f-42fd-b6a0-de2d7b9eb7e9","block_type":"box","text":"sub-advisers and internal auditors for the investment adviser or its affiliates, as appropriate, regarding risks","page_number":43,"box":{"x":116,"y":528,"width":741,"height":13}},{"id":"d66908f3-e07b-49c6-a5c0-9473078e2d1b","block_type":"box","text":"faced by each Fund and management’s or the service provider’s risk functions. The Committee system","page_number":43,"box":{"x":116,"y":544,"width":706,"height":13}},{"id":"34df3c67-0f50-4ee5-93f0-2fc7ee8484e0","block_type":"box","text":"facilitates the timely and efficient consideration of matters by the Directors, and facilitates effective oversight","page_number":43,"box":{"x":116,"y":559,"width":752,"height":13}},{"id":"6e9a9e04-5bd5-42a8-bc66-90e54c520f55","block_type":"box","text":"of compliance with legal and regulatory requirements and of each Fund’s activities and associated risks. The","page_number":43,"box":{"x":116,"y":575,"width":749,"height":13}},{"id":"fbabe2b4-4361-4b9a-948f-673ad5eae2ed","block_type":"box","text":"Board has appointed a Chief Compliance Officer, who oversees the implementation and testing of the","page_number":43,"box":{"x":116,"y":590,"width":706,"height":13}},{"id":"22d058c6-84f5-4241-83c7-c7d01fc43322","block_type":"box","text":"Company’s compliance program and reports to the Board regarding compliance matters for the Funds and","page_number":43,"box":{"x":117,"y":606,"width":739,"height":13}},{"id":"a855d040-6810-4308-bdf8-2294cf767401","block_type":"box","text":"their service providers. The Independent Directors have engaged independent legal counsel to assist them in","page_number":43,"box":{"x":116,"y":621,"width":744,"height":13}},{"id":"6742d4e6-d82c-427c-b982-fce1d051b1f5","block_type":"box","text":"performing their oversight responsibilities.","page_number":43,"box":{"x":116,"y":637,"width":292,"height":13}},{"id":"d447304e-a569-4a2e-bf4b-62c769ed64b1","block_type":"box","text":"Audit Committee.","page_number":43,"box":{"x":116,"y":660,"width":124,"height":10}},{"id":"1b6cc0d9-ce18-440f-bf78-48b95f534545","block_type":"box","text":"The members of the Audit Committee (the “Audit Committee”) are Henry R. Keizer","page_number":43,"box":{"x":246,"y":660,"width":588,"height":13}},{"id":"e7631d8d-c76e-4806-a726-01ccec932c19","block_type":"box","text":"(Chair), Neil A. Cotty, Lori Richards, Kenneth L. Urish and Claire A. Walton, all of whom are Independent","page_number":43,"box":{"x":117,"y":676,"width":747,"height":12}},{"id":"bf39df8c-e8d7-4d98-a686-eabcbcd3a9cb","block_type":"box","text":"Directors. The principal responsibilities of the Audit Committee are to approve, and recommend to the full","page_number":43,"box":{"x":116,"y":691,"width":741,"height":13}},{"id":"728aaec3-f8e1-4f88-a9d7-4911255248f5","block_type":"box","text":"Board for approval, the selection, retention, termination and compensation of each Fund’s independent","page_number":43,"box":{"x":116,"y":707,"width":716,"height":12}},{"id":"1d22281e-79c4-4166-b635-20536c714157","block_type":"box","text":"registered public accounting firm (the “Independent Registered Public Accounting Firm”) and to oversee the","page_number":43,"box":{"x":116,"y":722,"width":749,"height":13}},{"id":"59c7268e-c349-454c-9a7b-a672e435609a","block_type":"box","text":"Independent Registered Public Accounting Firm’s w","page_number":43,"box":{"x":116,"y":738,"width":360,"height":12}},{"id":"6bf538a2-55d2-46f9-95d3-8787f10fc030","block_type":"box","text":"ork. The Audit Committee’s responsibilities include,","page_number":43,"box":{"x":476,"y":738,"width":361,"height":12}},{"id":"3899cccc-c2a7-459a-875b-f1be8c2ee700","block_type":"box","text":"without limitation, to (1) evaluate the qualifications and independence of the Independent Registered Public","page_number":43,"box":{"x":116,"y":753,"width":747,"height":13}},{"id":"e16ed0ff-6909-4ddf-a26f-1eee59202cd6","block_type":"box","text":"Accounting Firm; (2) approve all audit engagement terms and fees for each Fund; (3) review the conduct and","page_number":43,"box":{"x":116,"y":769,"width":754,"height":13}},{"id":"33d4c7f7-b8cb-4568-b880-4d149e03154d","block_type":"box","text":"results of each independent audit of each Fund’s annual financial statements; (4) review any issues raised by","page_number":43,"box":{"x":116,"y":784,"width":746,"height":13}},{"id":"c5651f71-924e-4db2-928a-5ed38633c7d2","block_type":"box","text":"the Independent Registered Public Accounting Firm or Fund management regarding the accounting or","page_number":43,"box":{"x":116,"y":800,"width":708,"height":13}},{"id":"afee44dd-1ec7-4efc-860e-37cc481f3167","block_type":"box","text":"financial reporting policies and practices of each Fund and the internal controls of each Fund and certain","page_number":43,"box":{"x":116,"y":815,"width":726,"height":13}},{"id":"8dd7a125-493b-4438-87fa-6406102738c7","block_type":"box","text":"service providers; (5) oversee the performance of each Fund’s Independent Registered Public Accounting Firm;","page_number":43,"box":{"x":116,"y":831,"width":763,"height":13}},{"id":"5e0f48c8-bde0-4150-9041-dde7a6f17259","block_type":"box","text":"(6) review and discuss with management and each Fund’s Independent Registered Public Accounting Firm the","page_number":43,"box":{"x":117,"y":846,"width":760,"height":13}},{"id":"51b027ed-4132-4930-a85b-21fa1ec1bc5e","block_type":"box","text":"performance and findings of each Fund’s internal auditors; (7) discuss with Fund management its policies","page_number":43,"box":{"x":116,"y":862,"width":730,"height":13}},{"id":"c76bd443-5304-42c9-81d0-9aaf9e90aa87","block_type":"box","text":"I-25","page_number":43,"box":{"x":485,"y":917,"width":28,"height":9}},{"id":"1969f084-02b5-491a-ac25-389c13aea01f","block_type":"box","text":"NM1026U-6004382-43/605","page_number":43,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"695598cc-6729-4a50-a5f8-c411d538ff6a","block_type":"box","text":"regarding risk assessment and risk management as such matters relate to each Fund’s financial reporting and","page_number":44,"box":{"x":116,"y":79,"width":752,"height":13}},{"id":"f40cba54-9c25-49fe-b5e9-82675f7fb4c2","block_type":"box","text":"controls; (8) resolve any disagreements between Fund management and the Independent Registered Public","page_number":44,"box":{"x":116,"y":94,"width":735,"height":13}},{"id":"b09b1d03-3825-46f4-a3bf-af09debd269e","block_type":"box","text":"Accounting Firm regarding financial reporting; and (9) undertake such other duties and responsibilities as may","page_number":44,"box":{"x":116,"y":110,"width":766,"height":13}},{"id":"a3f45b16-e15d-4d82-af0e-3426db962b1d","block_type":"box","text":"from time to time be delegated by the Board to the Audit Committee. The Board has adopted a written","page_number":44,"box":{"x":116,"y":125,"width":714,"height":13}},{"id":"faa132e0-e8eb-4cca-b939-52e22cd55a03","block_type":"box","text":"charter for the Audit Committee. During the fiscal year ended December 31, 2025, the Audit Committee met","page_number":44,"box":{"x":116,"y":141,"width":757,"height":13}},{"id":"aca73699-f9dd-453e-82ab-a2ca31fb00f6","block_type":"box","text":"four times.","page_number":44,"box":{"x":116,"y":156,"width":73,"height":10}},{"id":"742ee49c-e26d-4bc8-97f0-a380e73bbc4e","block_type":"box","text":"Governance and Nominating Committee.","page_number":44,"box":{"x":117,"y":180,"width":288,"height":12}},{"id":"44401d95-15f0-46f7-8803-90e73440d992","block_type":"box","text":"The members of the Governance and Nominating Committee (the","page_number":44,"box":{"x":411,"y":180,"width":459,"height":12}},{"id":"08377d4e-11fe-4ab6-9cc9-3c69eb89764e","block_type":"box","text":"“Governance Committee”) are Cynthia A. Montgomery (Chair), Christopher J. Ailman, Susan J. Carter,","page_number":44,"box":{"x":117,"y":195,"width":724,"height":13}},{"id":"c30944bb-d7b8-48af-96f0-d7c9cb22f53e","block_type":"box","text":"Collette Chilton and Henry R. Keizer, all of whom are Independent Directors. The principal responsibilities of","page_number":44,"box":{"x":117,"y":211,"width":764,"height":12}},{"id":"9911d518-1393-41e2-b9a2-cd2b9690be02","block_type":"box","text":"the Governance Committee are to (1) identify individuals qualified to serve as Independent Directors of the","page_number":44,"box":{"x":116,"y":226,"width":742,"height":13}},{"id":"c91b73d0-9701-4ab8-9266-2ec79e0b9427","block_type":"box","text":"Company and recommend Independent Director nominees fo","page_number":44,"box":{"x":117,"y":242,"width":425,"height":12}},{"id":"d215adec-abe8-4e49-b389-f3ae9c985cd6","block_type":"box","text":"r election by shareholders or appointment by the","page_number":44,"box":{"x":543,"y":242,"width":337,"height":12}},{"id":"79ae0372-6931-469f-b527-7d4124292a30","block_type":"box","text":"Board; (2) advise the Board with respect to Board compos","page_number":44,"box":{"x":116,"y":257,"width":402,"height":13}},{"id":"e027d6a1-3220-49e1-849c-e121c1220645","block_type":"box","text":"ition, procedures and committees (other than the","page_number":44,"box":{"x":519,"y":257,"width":338,"height":13}},{"id":"5ca058c0-098a-4fc6-a490-88d583ac95bd","block_type":"box","text":"Audit Committee); (3) oversee periodic self-assessments of","page_number":44,"box":{"x":116,"y":273,"width":404,"height":12}},{"id":"96821f6e-44d8-474d-9791-4737de60739c","block_type":"box","text":"the Board and committees of the Board (other than","page_number":44,"box":{"x":524,"y":273,"width":355,"height":12}},{"id":"2540f3ce-ff7e-4902-92da-4fe6015cdd23","block_type":"box","text":"the Audit Committee); (4) review and make recommendati","page_number":44,"box":{"x":116,"y":288,"width":407,"height":12}},{"id":"f9269e33-a835-471e-8ad9-4fabc53fdc92","block_type":"box","text":"ons regarding Independent Director compensation;","page_number":44,"box":{"x":524,"y":288,"width":352,"height":13}},{"id":"f0d7ff9c-cf55-47f4-a532-dc6450f837e7","block_type":"box","text":"(5) monitor corporate governance matters and develop appropriate recommendations to the Board; (6) act as","page_number":44,"box":{"x":117,"y":304,"width":756,"height":12}},{"id":"d9714ad3-9c64-4b05-81a6-5cc0222a80ef","block_type":"box","text":"the administrative committee with respect to Board","page_number":44,"box":{"x":116,"y":319,"width":356,"height":13}},{"id":"2b106a23-d451-4f89-aed3-9a416df417f6","block_type":"box","text":"policies and procedures, committee policies and","page_number":44,"box":{"x":476,"y":319,"width":331,"height":13}},{"id":"01260e92-ccc5-4d6a-8ddc-3588b9de75fb","block_type":"box","text":"procedures (other than the Audit Committee) and codes of ethics as they relate to Independent Directors; and","page_number":44,"box":{"x":116,"y":335,"width":759,"height":12}},{"id":"9675a71f-48f6-4e6b-81ce-e7323955ed66","block_type":"box","text":"(7) undertake such other duties and responsibilities as may from time to time be delegated by the Board to the","page_number":44,"box":{"x":117,"y":350,"width":760,"height":13}},{"id":"244805d0-f84b-49dc-b22f-cb6b3ba6b89a","block_type":"box","text":"Governance Committee. The Governance Committee may","page_number":44,"box":{"x":117,"y":366,"width":404,"height":12}},{"id":"aa2db014-1b0c-4c75-b50b-feb18fe1b255","block_type":"box","text":"consider nominations for Directors made by each","page_number":44,"box":{"x":526,"y":366,"width":342,"height":12}},{"id":"31acf48c-d1ef-4b09-a4c2-4aa25f896c5f","block_type":"box","text":"Fund’s shareholders as it deems appropriate. Under the Company’s Amended and Restated Bylaws","page_number":44,"box":{"x":116,"y":381,"width":685,"height":13}},{"id":"415eda7a-8273-4e5d-ab14-b20273168a35","block_type":"box","text":"(“Bylaws”), shareholders must follow certain procedures to nominate a person for election as a Director at a","page_number":44,"box":{"x":117,"y":397,"width":752,"height":12}},{"id":"14d92c18-e25f-498f-834d-05658a52e50d","block_type":"box","text":"shareholder meeting at which Directors are to be elected. Under these advance notice procedures, notice of the","page_number":44,"box":{"x":116,"y":412,"width":764,"height":13}},{"id":"1851d464-7765-47d6-8cc1-1b6dd59ba3f7","block_type":"box","text":"proposed nominee to the Secretary of the Company must be delivered to or mailed and received at the","page_number":44,"box":{"x":116,"y":428,"width":708,"height":12}},{"id":"2e599a06-8dff-4cad-93e4-a4e1a4c2e6bf","block_type":"box","text":"principal executive offices of the Company not later than the close of business on the fifth day following the","page_number":44,"box":{"x":116,"y":443,"width":748,"height":13}},{"id":"9954a573-4ff1-4895-8188-647200fd3e7a","block_type":"box","text":"day on which notice of the date of the meeting was mailed or public disclosure of the date of the meeting was","page_number":44,"box":{"x":116,"y":459,"width":758,"height":12}},{"id":"670f51fb-c56d-421b-9d28-3ccd1f5b041a","block_type":"box","text":"made, whichever first occurs. The Company’s Bylaws provide that notice of a proposed nomination must","page_number":44,"box":{"x":116,"y":474,"width":731,"height":13}},{"id":"15c5ce0b-1ac3-4ce2-8810-78dfb3156c1c","block_type":"box","text":"include certain information about the shareholder and the nominee, as well as certain other information,","page_number":44,"box":{"x":116,"y":490,"width":725,"height":12}},{"id":"9aab620c-1a74-481c-bd48-7412c839cbe2","block_type":"box","text":"including a written consent of the proposed nominee to serve if elected. Reference is made to the Company’s","page_number":44,"box":{"x":116,"y":505,"width":751,"height":13}},{"id":"ed2694e5-22d6-430d-85bb-5aaefb9fa6d9","block_type":"box","text":"Bylaws for more details. The Board has adopted a written charter for the Governance Committee. During the","page_number":44,"box":{"x":116,"y":521,"width":759,"height":12}},{"id":"ee28ee99-a5fd-458f-8fde-8c44c0258556","block_type":"box","text":"fiscal year ended December 31, 2025, the Governance Committee met eleven times.","page_number":44,"box":{"x":116,"y":536,"width":579,"height":13}},{"id":"07c6b6f7-db44-49c2-99e0-de856a2ea00d","block_type":"box","text":"Compliance Committee.","page_number":44,"box":{"x":117,"y":559,"width":167,"height":13}},{"id":"d8718b61-2f50-49c6-a321-d00bac9b5b4f","block_type":"box","text":"The members of the Compliance Committee (the “Compliance Committee”) are","page_number":44,"box":{"x":290,"y":559,"width":558,"height":13}},{"id":"d2a711da-1f06-4acb-82ab-14dadef93627","block_type":"box","text":"Claire A. Walton (Chair), Cynthia A. Montgomery, Donald C. Opatrny, Lori Richards and Kenneth L. Urish,","page_number":44,"box":{"x":117,"y":575,"width":761,"height":13}},{"id":"62a930a4-2d9e-465f-8a68-efa689868079","block_type":"box","text":"all of whom are Independent Directors. The Compliance Committee’s purpose is to assist the Board in","page_number":44,"box":{"x":116,"y":590,"width":710,"height":13}},{"id":"cee25c93-4ea3-40a9-9e16-d9a12e7c0d49","block_type":"box","text":"fulfilling its responsibility to oversee regulatory and fiduciary","page_number":44,"box":{"x":116,"y":606,"width":422,"height":13}},{"id":"7f3e0ff8-25fc-405c-8d69-b49cb78f7e12","block_type":"box","text":"compliance matters involving the Company, the","page_number":44,"box":{"x":543,"y":606,"width":332,"height":13}},{"id":"ab47f1c3-497f-4ae1-bddc-2ba57f9bb263","block_type":"box","text":"fund-related activities of BlackRock and any sub-adviser and the Company’s third-party service providers.","page_number":44,"box":{"x":116,"y":621,"width":735,"height":13}},{"id":"f27df9d1-ae46-4c77-bc58-ba795eab1ddc","block_type":"box","text":"The Compliance Committee’s responsibilities include, without limitation, to (1) oversee the compliance","page_number":44,"box":{"x":116,"y":637,"width":715,"height":13}},{"id":"4c31a496-eb35-450e-8afa-b8f008b6ec79","block_type":"box","text":"policies and procedures of the Company and its service providers and recommend changes or additions to","page_number":44,"box":{"x":116,"y":652,"width":734,"height":13}},{"id":"50dd7e54-a75d-4134-9f72-7cce0a191847","block_type":"box","text":"such policies and procedures; (2) review information on and, where appropriate, recommend policies","page_number":44,"box":{"x":116,"y":668,"width":700,"height":13}},{"id":"0fd0e0cb-b3c7-4110-b04e-3e4e13be5c05","block_type":"box","text":"concerning the Company’s compliance with applicab","page_number":44,"box":{"x":116,"y":683,"width":368,"height":13}},{"id":"ba002577-8722-469e-87cc-579b807f5906","block_type":"box","text":"le law; (3) review reports from, oversee the annual","page_number":44,"box":{"x":484,"y":683,"width":349,"height":13}},{"id":"04b5f427-44e0-4ca2-8c88-b87d8b6b8dcd","block_type":"box","text":"performance review of, and make certain recommendations and determinations regarding the Company’s","page_number":44,"box":{"x":116,"y":699,"width":732,"height":13}},{"id":"5584fe22-6f1a-4bad-8549-233729979fed","block_type":"box","text":"Chief Compliance Officer (the “CCO”), including determining the amount and structure of the CCO’s","page_number":44,"box":{"x":117,"y":714,"width":712,"height":13}},{"id":"952e6def-048e-4771-98df-52a78d641cab","block_type":"box","text":"compensation and recommending such amount and structure to the full Board for approval and ratification;","page_number":44,"box":{"x":116,"y":730,"width":751,"height":13}},{"id":"78d6d252-db4f-4916-b8a3-fcd856b41a2f","block_type":"box","text":"and (4) undertake such other duties and responsibilities as may from time to time be delegated by the Board to","page_number":44,"box":{"x":116,"y":745,"width":766,"height":13}},{"id":"ae2bfbb7-807f-42af-99ac-67bba68a62a2","block_type":"box","text":"the Compliance Committee. The Board has adopted a written charter for the Compliance Committee. During","page_number":44,"box":{"x":116,"y":761,"width":761,"height":13}},{"id":"532932d9-39bf-44fe-977d-e329dafd4460","block_type":"box","text":"the fiscal year ended December 31, 2025, the Compliance Committee met four times.","page_number":44,"box":{"x":116,"y":776,"width":591,"height":13}},{"id":"83a2819e-cf56-4505-aca3-32d7e725be1b","block_type":"box","text":"Performance Oversight Committee.","page_number":44,"box":{"x":116,"y":800,"width":247,"height":13}},{"id":"b641674c-8a02-4354-9ccf-9c2184ae8920","block_type":"box","text":"The members of the Performance Oversight Committee (the","page_number":44,"box":{"x":369,"y":800,"width":416,"height":13}},{"id":"5c76ffc2-0bf9-4c2e-832f-596b18d2a145","block_type":"box","text":"“Performance Oversight Committee”) are Donald C. Opatrny (Chair), Christopher J. Ailman, Susan J. Carter,","page_number":44,"box":{"x":117,"y":815,"width":765,"height":13}},{"id":"80ed7fdd-9b24-45f2-a8ea-72fb64f0aa02","block_type":"box","text":"Collette Chilton and Neil A. Cotty, all of whom are Independent Directors. The Performance Oversight","page_number":44,"box":{"x":117,"y":831,"width":718,"height":13}},{"id":"37682e79-8f79-40ff-8a46-16a3d84b257e","block_type":"box","text":"Committee’s purpose is to assist the Board in fulfilling its responsibility to oversee each Fund’s investment","page_number":44,"box":{"x":117,"y":846,"width":732,"height":13}},{"id":"591cc1eb-3231-4ed8-83e2-e14b4e9ffc81","block_type":"box","text":"performance relative to its agreed-upon performance objectives and to assist the Independent Directors in","page_number":44,"box":{"x":116,"y":862,"width":731,"height":13}},{"id":"341a67c2-9fb6-4d4b-9d0b-d92d467c6638","block_type":"box","text":"I-26","page_number":44,"box":{"x":485,"y":917,"width":29,"height":9}},{"id":"31aaf570-5cc0-4d78-810c-56558966a876","block_type":"box","text":"NM1026U-6004382-44/605","page_number":44,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"2b8d8d09-8b35-4850-b80f-ea5b8151974c","block_type":"box","text":"their consideration of investment advisory agreements. The Performance Oversight Committee’s","page_number":45,"box":{"x":116,"y":79,"width":667,"height":13}},{"id":"224ae4cf-5495-4547-a716-3a3de5ed7439","block_type":"box","text":"responsibilities include, without limitation, to (1) review information on, and make recommendations to the","page_number":45,"box":{"x":116,"y":94,"width":749,"height":13}},{"id":"ffebd7f6-c1a2-4a32-83d4-c7c1557e3e16","block_type":"box","text":"full Board in respect of, each Fund’s investment objective, policies and practices; (2) review information on","page_number":45,"box":{"x":116,"y":110,"width":740,"height":13}},{"id":"8114ee28-fa58-41e1-adb3-bddf9f072a54","block_type":"box","text":"each Fund’s investment performance; (3) review information on appropriate benchmarks and competitive","page_number":45,"box":{"x":116,"y":125,"width":733,"height":13}},{"id":"b0c00f9a-6969-4006-8c81-a24bcbf25b27","block_type":"box","text":"universes and unusual or exceptional investment matters; (4) review personnel and other resources devoted to","page_number":45,"box":{"x":116,"y":141,"width":760,"height":13}},{"id":"c158a883-090c-49e4-b77a-63441b462a67","block_type":"box","text":"management of each Fund and evaluate the nature and quality of information furnished to the Performance","page_number":45,"box":{"x":116,"y":156,"width":747,"height":13}},{"id":"481fc876-30d3-49d9-b967-89183b78329b","block_type":"box","text":"Oversight Committee; (5) recommend any required action regarding changes in fundamental and","page_number":45,"box":{"x":117,"y":172,"width":673,"height":13}},{"id":"6184d6d4-3dee-461c-afc5-c7731cc7fa13","block_type":"box","text":"non-fundamental investment policies and restrictions","page_number":45,"box":{"x":116,"y":187,"width":367,"height":13}},{"id":"c1d36820-4181-4ccb-bb64-77055a20ab72","block_type":"box","text":", fund mergers or liquidations; (6) request and review","page_number":45,"box":{"x":484,"y":187,"width":369,"height":13}},{"id":"ce5694dc-59b9-442a-bd6b-3a8c471d1d49","block_type":"box","text":"information on the nature, extent and quality of","page_number":45,"box":{"x":116,"y":203,"width":335,"height":13}},{"id":"d10c1e78-2f57-4dac-b498-ad1cc893bd70","block_type":"box","text":"services provided to the shareholders; (7) make","page_number":45,"box":{"x":455,"y":203,"width":325,"height":13}},{"id":"872b7416-02b8-483b-867d-c82b913173d0","block_type":"box","text":"recommendations to the Board concerning the approval or renewal of investment advisory agreements; and","page_number":45,"box":{"x":116,"y":218,"width":745,"height":13}},{"id":"330ebc9f-a93e-41cc-a883-3f0a818005b2","block_type":"box","text":"(8) undertake such other duties and responsibilities as may from time to time be delegated by the Board to the","page_number":45,"box":{"x":117,"y":234,"width":760,"height":13}},{"id":"f729bdb7-9b2f-4bc3-8a40-7912a405d7f1","block_type":"box","text":"Performance Oversight Committee. The Board has adopted a written charter for the Performance Oversight","page_number":45,"box":{"x":116,"y":249,"width":749,"height":13}},{"id":"f60adf8a-b959-4427-a43b-a3eda06ed9bc","block_type":"box","text":"Committee. During the fiscal year ended December 31, 2025, the Performance Oversight Committee met","page_number":45,"box":{"x":117,"y":265,"width":729,"height":13}},{"id":"347e377b-0f94-4d5e-886e-6200f884f311","block_type":"box","text":"five times.","page_number":45,"box":{"x":116,"y":280,"width":69,"height":10}},{"id":"bf2b0d68-83f8-4c64-9e98-0f3eb3da13e0","block_type":"box","text":"Ad Hoc Topics Committee.","page_number":45,"box":{"x":116,"y":304,"width":191,"height":12}},{"id":"9c4dc617-f958-405e-bdbe-88a2161d97ed","block_type":"box","text":"The members of the Ad Hoc Topics Committee (the “Ad Hoc Topics","page_number":45,"box":{"x":313,"y":304,"width":481,"height":12}},{"id":"90bc8619-3e29-48a3-9705-750890f5eaff","block_type":"box","text":"Committee”) are Mark Stalnecker (Chair) and Claire A. Walton, both of whom are Independent Directors,","page_number":45,"box":{"x":117,"y":319,"width":742,"height":13}},{"id":"07adc206-7971-47e1-942a-2052e66fb813","block_type":"box","text":"and John M. Perlowski, who serves as an interested Director. The principal responsibilities of the Ad Hoc","page_number":45,"box":{"x":116,"y":335,"width":733,"height":12}},{"id":"dce388fc-f281-4c03-b542-c8bbfd688f00","block_type":"box","text":"Topics Committee are to (1) act on routine matters between meetings of the Board; (2) act on such matters as","page_number":45,"box":{"x":116,"y":350,"width":759,"height":13}},{"id":"fbb46cef-182e-4d77-8081-9f2a1ca41511","block_type":"box","text":"may require urgent action between meetings of the Board; and (3) exercise such other authority as may from","page_number":45,"box":{"x":116,"y":366,"width":753,"height":12}},{"id":"730591f2-5536-4d81-89ed-64f9c8062aab","block_type":"box","text":"time to time be delegated to the Ad Hoc Topics Committee by the Board. The Board has adopted a written","page_number":45,"box":{"x":116,"y":381,"width":743,"height":13}},{"id":"5d39381f-6c41-46cc-bb37-67f7da9aeee5","block_type":"box","text":"charter for the Ad Hoc Topics Committee. During the fiscal year ended December 31, 2025, the Ad Hoc","page_number":45,"box":{"x":116,"y":397,"width":727,"height":12}},{"id":"e98ed830-4129-4faf-869b-a9f6d2afd07e","block_type":"box","text":"Topics Committee did not meet.","page_number":45,"box":{"x":116,"y":412,"width":224,"height":13}},{"id":"93af673b-38ca-4e50-aa0d-f8b49a93e07c","block_type":"box","text":"The Governance Committee has adopted a statement of policy that describes the experience, qualifications, skills","page_number":45,"box":{"x":116,"y":435,"width":763,"height":13}},{"id":"531ae059-7647-4903-bc1b-2dbf80673301","block_type":"box","text":"and attributes that are necessary and desirable for potential Independent Director candidates (the “Statement of","page_number":45,"box":{"x":116,"y":451,"width":756,"height":13}},{"id":"483714a1-92f6-4661-abef-243c7fcfac30","block_type":"box","text":"Policy”). The Board believes that each Independent Director satisfied, at the time he or she was initially elected","page_number":45,"box":{"x":116,"y":466,"width":748,"height":13}},{"id":"9cb7118a-ab83-46a9-a1cb-73b3b612436b","block_type":"box","text":"or appointed a Director, and continues to satisfy, the","page_number":45,"box":{"x":116,"y":482,"width":358,"height":13}},{"id":"1c43838b-7f3f-4fea-822f-d10a13b1b001","block_type":"box","text":"standards contemplated by the Statement of Policy.","page_number":45,"box":{"x":478,"y":482,"width":346,"height":13}},{"id":"800ec662-edcd-49ed-bc25-20f0d93df104","block_type":"box","text":"Furthermore, in determining that a particular Independent Director was and continues to be qualified to serve as","page_number":45,"box":{"x":116,"y":497,"width":761,"height":13}},{"id":"b86a7c6f-17eb-42b7-9467-990c9d64f7ae","block_type":"box","text":"a Director, the Board has considered a variety of criteria, none of which, in isolation, was controlling. The Board","page_number":45,"box":{"x":116,"y":513,"width":764,"height":13}},{"id":"6dfc97a8-d8f9-4845-9a5f-198e337e6235","block_type":"box","text":"believes that, collectively, the Independent Directors have balanced and diverse experience, skills, attributes and","page_number":45,"box":{"x":116,"y":528,"width":753,"height":13}},{"id":"ada84628-9339-43b3-b147-0499358d3b11","block_type":"box","text":"qualifications, which allow the Board to operate effectively in governing the Company and protecting the","page_number":45,"box":{"x":116,"y":544,"width":712,"height":13}},{"id":"583ae96c-66f1-4f56-80f7-2205a706e093","block_type":"box","text":"interests of shareholders. Among the attributes common to all Independent Directors are their ability to review","page_number":45,"box":{"x":116,"y":559,"width":749,"height":13}},{"id":"5192f016-3264-44e6-8c26-cf26a96ec3d8","block_type":"box","text":"critically, evaluate, question and discuss information pro","page_number":45,"box":{"x":116,"y":575,"width":382,"height":13}},{"id":"c251cd72-3d56-47f1-a3bb-ca13e8d152ac","block_type":"box","text":"vided to them, to interact effectively with each Fund’s","page_number":45,"box":{"x":499,"y":575,"width":363,"height":13}},{"id":"cbe49f97-725f-40b5-b8de-b3d4079a20f2","block_type":"box","text":"investment adviser, sub-advisers, other service providers, counsel and the Independent Registered Public","page_number":45,"box":{"x":116,"y":590,"width":702,"height":13}},{"id":"0c5c5163-2633-4bc1-a786-38eb1896eba8","block_type":"box","text":"Accounting Firm, and to exercise effective business judgment in the performance of their duties as Directors.","page_number":45,"box":{"x":116,"y":606,"width":732,"height":13}},{"id":"eeccc83f-25bb-4fc6-85d8-bb47832db24b","block_type":"box","text":"Each Director’s ability to perform his or her duties effectively is evidenced by his or her educational","page_number":45,"box":{"x":116,"y":629,"width":688,"height":13}},{"id":"46051133-c1aa-4949-b0c2-ed160d34cbb2","block_type":"box","text":"background or professional training; business, consulting, public service or academic positions; experience","page_number":45,"box":{"x":116,"y":645,"width":736,"height":12}},{"id":"597c9179-c886-46cf-b3c5-cd39af4b51aa","block_type":"box","text":"from service as a board member of the Company and the other funds in the BlackRock Fund Complexes (and","page_number":45,"box":{"x":116,"y":660,"width":762,"height":13}},{"id":"a0cd5917-5917-486f-a542-83e32116c562","block_type":"box","text":"any predecessor funds), other investment funds, public companies, non-profit entities or other organizations;","page_number":45,"box":{"x":116,"y":676,"width":752,"height":12}},{"id":"058ec458-a596-4a79-bd13-871df43d1e38","block_type":"box","text":"ongoing commitment to and participation in Board an","page_number":45,"box":{"x":116,"y":691,"width":377,"height":13}},{"id":"3e98abbf-31b5-4d48-b041-c52beae03d13","block_type":"box","text":"d Committee meetings, as well as his or her leadership","page_number":45,"box":{"x":494,"y":691,"width":375,"height":13}},{"id":"c3a060b3-613e-4785-aa4b-be023cd5ddfc","block_type":"box","text":"of standing and ad hoc committees throughout the years; or other relevant life experiences.","page_number":45,"box":{"x":116,"y":707,"width":629,"height":12}},{"id":"5cf7ffdb-c252-486b-b136-bb8067598cf6","block_type":"box","text":"Directors Elect","page_number":45,"box":{"x":116,"y":730,"width":105,"height":10}},{"id":"b88d8dd4-d669-4f28-b1af-4ba26dc14b56","block_type":"box","text":". Jeffrey Jarczyk and Marc D. Stern have been appointed as Directors of the Company effective","page_number":45,"box":{"x":222,"y":730,"width":657,"height":13}},{"id":"0045cafe-06e6-4e0c-81f7-1ac68dd7fec3","block_type":"box","text":"July 1, 2026 (each, a “Director-Elect”). Each Director Elect is expected to qualify as an Independent Director","page_number":45,"box":{"x":115,"y":745,"width":758,"height":13}},{"id":"3d9d808c-3d3d-46e7-85cb-1ab7906f121f","block_type":"box","text":"at the time of his service. Each Director Elect has been retained as a consultant to the Independent Directors to","page_number":45,"box":{"x":116,"y":761,"width":766,"height":13}},{"id":"2abe697d-0071-4255-81e6-db2080c2bc1f","block_type":"box","text":"assist the Independent Directors in the performance of their duties to the Company and is expected to serve in","page_number":45,"box":{"x":116,"y":776,"width":762,"height":13}},{"id":"21f8eae9-c5cf-49ee-a99f-7b8f0129a361","block_type":"box","text":"that capacity until July 1, 2026.","page_number":45,"box":{"x":116,"y":792,"width":219,"height":13}},{"id":"92112552-ecb6-4c04-ab18-8c8ac6fa456d","block_type":"box","text":"I-27","page_number":45,"box":{"x":485,"y":917,"width":29,"height":9}},{"id":"649ae795-f692-43d9-aa47-726fdaf28ebd","block_type":"box","text":"NM1026U-6004382-45/605","page_number":45,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"0da0c617-f166-480e-9df1-35db69216af3","block_type":"box","text":"The table below discusses some of the experiences, qualifications and skills of each of the Directors that","page_number":46,"box":{"x":116,"y":79,"width":718,"height":13}},{"id":"cf2013a9-e1fa-4871-94c8-f8984352f07c","block_type":"box","text":"support the conclusion that each Director should serve on the Board.","page_number":46,"box":{"x":116,"y":94,"width":477,"height":13}},{"id":"71794e0a-f8d6-4cb0-adad-45f436da3182","block_type":"box","text":"Directors","page_number":46,"box":{"x":116,"y":122,"width":53,"height":8}},{"id":"6b06c4f6-3ff1-4eed-90b6-228315f6b9f3","block_type":"box","text":"Experience, Qualifications and Skills","page_number":46,"box":{"x":276,"y":122,"width":212,"height":10}},{"id":"3206640a-d4ed-49a5-8bbc-aaa43d62770f","block_type":"box","text":"Independent Directors","page_number":46,"box":{"x":116,"y":144,"width":130,"height":10}},{"id":"0d3a68f5-2268-4011-a1ff-88710a5c217a","block_type":"box","text":"Christopher J. Ailman","page_number":46,"box":{"x":116,"y":160,"width":128,"height":10}},{"id":"4a59dc6c-7201-4f61-a50d-8acd7e681fd7","block_type":"box","text":"Christopher Ailman has more than 30 years of experience in the financial services industry, including","page_number":46,"box":{"x":276,"y":160,"width":581,"height":10}},{"id":"c3d6605c-cecf-4534-9925-5cc2974bcc28","block_type":"box","text":"most recently serving as Chief Investment Officer of the California State Teachers Retirement System","page_number":46,"box":{"x":276,"y":170,"width":579,"height":10}},{"id":"e0c5b504-a96b-4bc8-81f4-11dfa49a07b4","block_type":"box","text":"(CalSTRS) from 2000 to June 2024 where he led its investment program. Mr. Ailman currently is a","page_number":46,"box":{"x":277,"y":180,"width":569,"height":10}},{"id":"d236f295-b5c1-4022-ae02-afc695fdfad6","block_type":"box","text":"principal at Ailman Advisers. In addition, he has held various roles in the industry, including as member","page_number":46,"box":{"x":276,"y":191,"width":598,"height":10}},{"id":"15c55450-0310-4954-ad12-601ed4615049","block_type":"box","text":"and chair of the asset owner committee of the Kroner Center for Financial Research, chairman of the","page_number":46,"box":{"x":276,"y":201,"width":580,"height":10}},{"id":"da1db8f7-cf20-4002-807d-105d406e6769","block_type":"box","text":"North American Chapter of the 300 Club of Global CIOs, and co-chair of the Milken Global Capital","page_number":46,"box":{"x":276,"y":211,"width":582,"height":10}},{"id":"a56be626-3f6b-4233-971b-516b3b74bf38","block_type":"box","text":"Markets Advisory Council. These positions have provided Mr. Ailman with considerable investment","page_number":46,"box":{"x":276,"y":222,"width":576,"height":10}},{"id":"c636401b-88a1-44b9-84c6-ac7f8963512f","block_type":"box","text":"expertise across asset classes and strategies, and insight and perspective on the markets and the economy.","page_number":46,"box":{"x":276,"y":232,"width":603,"height":10}},{"id":"beeafd38-d794-45d8-a092-e76dcb0bb6de","block_type":"box","text":"In addition, Mr. Ailman serves as a member of the Governance Committee and the Performance","page_number":46,"box":{"x":276,"y":242,"width":552,"height":10}},{"id":"89a63acc-9f6e-497d-b33c-7c54cba58a96","block_type":"box","text":"Oversight Committee.","page_number":46,"box":{"x":276,"y":253,"width":126,"height":10}},{"id":"08d8bc5d-071e-4b80-91e6-836d5c5bf86b","block_type":"box","text":"Susan J. Carter","page_number":46,"box":{"x":116,"y":269,"width":87,"height":9}},{"id":"c41abe2a-7081-4c71-831e-c3657e7f585f","block_type":"box","text":"Susan J. Carter has over 35 years of experience in investment management. She has served as President &","page_number":46,"box":{"x":276,"y":268,"width":606,"height":10}},{"id":"27428e62-fec7-4ace-ae4b-069b23fb3375","block_type":"box","text":"Chief Executive Officer of Commonfund Capital, Inc. (“CCI”), a registered investment adviser focused","page_number":46,"box":{"x":276,"y":278,"width":591,"height":11}},{"id":"d9d44481-6554-4970-9b59-cc23b3ce6d4d","block_type":"box","text":"on non-profit investors, from 1997 to 2013, Chief Executive Officer of CCI from 2013 to 2014 and","page_number":46,"box":{"x":276,"y":289,"width":574,"height":10}},{"id":"b0cd14ce-a6b9-4242-85ed-cc65754ff19b","block_type":"box","text":"Senior Advisor to CCI in 2015. Ms. Carter also served as director of the Pacific Pension Institute from","page_number":46,"box":{"x":276,"y":299,"width":587,"height":8}},{"id":"accaca4b-8f71-4e0b-a570-d2e1b6753612","block_type":"box","text":"2014 to 2018, trustee to the Financial Accounting Foundation from 2017 to 2021, Advisory Board","page_number":46,"box":{"x":276,"y":309,"width":569,"height":11}},{"id":"9aee1267-7000-425a-9b42-56c9c49ab2e2","block_type":"box","text":"Member for the Center for Private Equity and Entrepreneurship at Tuck School of Business from 1997 to","page_number":46,"box":{"x":276,"y":320,"width":605,"height":10}},{"id":"4f884c17-ebfe-418d-8f5a-1e17eae71d15","block_type":"box","text":"2021, Advisory Board Member for Bridges Fund Management from 2016 to 2018, Advisory Board","page_number":46,"box":{"x":276,"y":330,"width":570,"height":10}},{"id":"e97069e1-71ee-4b3a-b534-3ed2203bd7ec","block_type":"box","text":"Member for Girls Who Invest from 2015 to 2018 and Board Member thereof from 2018 to 2022, and","page_number":46,"box":{"x":276,"y":340,"width":588,"height":10}},{"id":"1d0e5872-fd69-48b6-ae18-bfa2ca088465","block_type":"box","text":"Practitioner Advisory Board Member for Private Capital Research Institute (“PCRI”) from 2017 to 2024.","page_number":46,"box":{"x":276,"y":351,"width":606,"height":10}},{"id":"a1dfe562-ed83-4848-9278-673c1f94acac","block_type":"box","text":"She currently serves as Member of the President’s Counsel for Commonfund. These positions have","page_number":46,"box":{"x":276,"y":361,"width":565,"height":10}},{"id":"f647538f-d54c-4fda-9e8d-97c8ce5487d4","block_type":"box","text":"provided her with insight and perspective on the markets and the economy.","page_number":46,"box":{"x":276,"y":371,"width":432,"height":11}},{"id":"8913a134-0454-4ac3-a75c-9663f6c062b9","block_type":"box","text":"Collette Chilton Collette Chilton has over 20 years of experience in investment management. She held the position of","page_number":46,"box":{"x":116,"y":387,"width":742,"height":10}},{"id":"1aacd24a-e55d-4892-831f-583c9fbe400f","block_type":"box","text":"Chief Investment Officer of Williams College from October 2006 to June 2023. Prior to that she was","page_number":46,"box":{"x":276,"y":397,"width":584,"height":11}},{"id":"130303f5-7847-4d6e-b661-d4afc187ced1","block_type":"box","text":"President and Chief Investment Officer of Lucent Asset Management Corporation, where she oversaw\r\n$","page_number":46,"box":{"x":276,"y":408,"width":591,"height":10}},{"id":"3038b5e3-8760-495b-a289-2b14c8e5d5df","block_type":"box","text":"gp\r\napproximately $40 billion in pension and retirement savings assets for the company. These positions","page_number":46,"box":{"x":276,"y":418,"width":581,"height":10}},{"id":"afd4e4ad-c692-44b8-ab5c-f8971d572896","block_type":"box","text":"have provided her with insight and perspective on the markets and the economy.","page_number":46,"box":{"x":276,"y":428,"width":466,"height":11}},{"id":"116e170f-bb48-4245-887a-6402ab956c05","block_type":"box","text":"Neil A. Cotty Neil A. Cotty has more than 30 years of experience in the financial services industry, including 19 years","page_number":46,"box":{"x":116,"y":444,"width":760,"height":10}},{"id":"4923dd9b-c0a7-4aa6-8733-193a747961df","block_type":"box","text":"at Bank of America Corporation and its affiliates, where he served, at different times, as the Chief","page_number":46,"box":{"x":276,"y":454,"width":566,"height":10}},{"id":"3498e88e-8b77-42c8-8db4-006e8ddd1b94","block_type":"box","text":"Financial Officer of various businesses including Investment Banking, Global Markets, Wealth","page_number":46,"box":{"x":276,"y":464,"width":546,"height":11}},{"id":"0925bb77-cbe0-4e7a-b85c-48709b4053ba","block_type":"box","text":"Management and Consumer and also served ten years as the Chief Accounting Officer for Bank of","page_number":46,"box":{"x":276,"y":475,"width":570,"height":10}},{"id":"8a4f97f6-7165-492f-944b-ecbced3d9a48","block_type":"box","text":"America Corporation. Mr. Cotty has been determined by the Audit Committee to be an audit committee","page_number":46,"box":{"x":276,"y":485,"width":605,"height":10}},{"id":"eba42aeb-0d47-4a49-aaa7-976118cda0c7","block_type":"box","text":"financial expert, as such term is defined in the applicable Commission rules.","page_number":46,"box":{"x":276,"y":495,"width":438,"height":11}},{"id":"c7e5cceb-d69b-4ec6-adce-4b0574e79cea","block_type":"box","text":"Henry R. Keizer Henry R. Keizer brings over 40 years of executive, financial, operational, strategic and global expertise","page_number":46,"box":{"x":116,"y":511,"width":755,"height":10}},{"id":"6cc70dc8-af03-41bc-90bf-69307bd11a9d","block_type":"box","text":"gained through his 35 year career at KPMG, a global professional services organization and by his","page_number":46,"box":{"x":276,"y":521,"width":569,"height":11}},{"id":"e9a0a058-3c36-40c6-a1a3-136e0bafd34c","block_type":"box","text":"service as a director to both publicly and privately held organizations. He has extensive experience with","page_number":46,"box":{"x":276,"y":532,"width":599,"height":10}},{"id":"e946f81e-12a9-40ae-86a7-e6466f079bd6","block_type":"box","text":"issues facing complex, global companies and expertise in financial reporting, accounting, auditing, risk","page_number":46,"box":{"x":276,"y":542,"width":594,"height":10}},{"id":"69b201e1-3c97-4ff6-92bb-390abb989653","block_type":"box","text":"management, and regulatory affairs for such companies. Mr. Keizer’s experience also includes service as","page_number":46,"box":{"x":276,"y":552,"width":601,"height":11}},{"id":"5ff0a43c-2fd8-4f5b-b84c-0d9fa382390e","block_type":"box","text":"an audit committee chair to both publicly and privately held organizations across numerous industries","page_number":46,"box":{"x":276,"y":563,"width":591,"height":10}},{"id":"6f3a06fc-9dd0-443c-b2d4-e609544debde","block_type":"box","text":"including professional services, property and casualty reinsurance, insurance, diversified financial","page_number":46,"box":{"x":276,"y":573,"width":562,"height":10}},{"id":"8b7cd0e5-10aa-4e72-b9cb-3255ff011ea7","block_type":"box","text":"services, banking, direct to consumer, business to business and technology. Mr. Keizer is a certified","page_number":46,"box":{"x":276,"y":583,"width":573,"height":11}},{"id":"c5ceac96-9822-4b79-9817-4d4b3eaff95e","block_type":"box","text":"public accountant and also served on the board of the American Institute of Certified Public","page_number":46,"box":{"x":276,"y":594,"width":532,"height":10}},{"id":"5575eca9-be7d-4bd8-b420-fd65d9217d0b","block_type":"box","text":"Accountants. Mr. Keizer has been determined by the Audit Committee to be an audit committee","page_number":46,"box":{"x":276,"y":604,"width":557,"height":10}},{"id":"8dd8eeb2-6b03-47a5-8a2e-10d97324399d","block_type":"box","text":"financial expert, as such term is defined in the applicable Commission rules.","page_number":46,"box":{"x":276,"y":614,"width":438,"height":11}},{"id":"98a78dce-e7e0-45fd-8c71-4d42fa3c7606","block_type":"box","text":"Cynthia A. Montgomery Cynthia A. Montgomery has served for over 20 years on the boards of registered investment companies,","page_number":46,"box":{"x":116,"y":630,"width":754,"height":10}},{"id":"84a5ff0f-f26b-446c-a85f-10db94d30551","block_type":"box","text":"most recently as a member of the boards of certain BlackRock-advised Funds and predecessor funds,","page_number":46,"box":{"x":276,"y":640,"width":574,"height":10}},{"id":"bbeb6021-1a3f-45fb-bdd0-936c50f19681","block_type":"box","text":"including the legacy Merrill Lynch Investment Managers, L.P. (“MLIM”) funds. The Board benefits","page_number":46,"box":{"x":276,"y":651,"width":570,"height":10}},{"id":"e3932cc0-3e98-4204-a9f1-0fa96208087b","block_type":"box","text":"from Ms. Montgomery’s more than 20 years of academic experience as a professor at Harvard Business","page_number":46,"box":{"x":276,"y":661,"width":592,"height":10}},{"id":"192328a8-4291-4d34-8cce-dae369bc18f9","block_type":"box","text":"School where she taught courses on corporate strategy and corporate governance. Ms. Montgomery also","page_number":46,"box":{"x":276,"y":671,"width":597,"height":10}},{"id":"7e8fdbee-0818-4665-b27f-178d8e93dd03","block_type":"box","text":"has business management and corporate governance experience through her service on the corporate","page_number":46,"box":{"x":276,"y":682,"width":575,"height":10}},{"id":"02e893b4-9f6c-4252-a339-21e1bc670d88","block_type":"box","text":"boards of a variety of public companies. She has also authored numerous articles and books on these","page_number":46,"box":{"x":276,"y":692,"width":576,"height":10}},{"id":"9443cfe0-6d06-46b3-a521-9bac1645c0ad","block_type":"box","text":"topics.","page_number":46,"box":{"x":276,"y":703,"width":36,"height":9}},{"id":"2486dd8b-6681-4fa1-ba35-9308a26d3ee4","block_type":"box","text":"Donald C. Opatrny Donald C. Opatrny has more than 40 years of business, oversight and executive experience, including","page_number":46,"box":{"x":116,"y":718,"width":749,"height":10}},{"id":"bce0cddd-5217-4bbc-a90e-ea92524a16ab","block_type":"box","text":"through his service as president, director and investment committee chair for academic and","page_number":46,"box":{"x":276,"y":728,"width":526,"height":10}},{"id":"5ac0571a-a96f-4127-bbb2-45299c39a4bd","block_type":"box","text":"not-for-profit organizations, and his experience as a partner, managing director and advisory director at","page_number":46,"box":{"x":276,"y":738,"width":603,"height":11}},{"id":"7f331759-0ea9-4dd7-b105-d96522b57f03","block_type":"box","text":"Goldman Sachs for 32 years. He also has investment management experience as a board member of","page_number":46,"box":{"x":276,"y":749,"width":578,"height":10}},{"id":"dc202067-0065-4a03-813e-47dc19c324c1","block_type":"box","text":"Athena Capital Advisors LLC.","page_number":46,"box":{"x":276,"y":759,"width":175,"height":10}},{"id":"8d17f3e4-a62a-4001-8b07-960575ceac8a","block_type":"box","text":"I-28","page_number":46,"box":{"x":485,"y":917,"width":28,"height":9}},{"id":"80c6530a-4db2-4b7a-86d6-004b9716cded","block_type":"box","text":"NM1026U-6004382-46/605","page_number":46,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"e989564e-e1c4-42c1-b86d-1eacadc6580a","block_type":"box","text":"Directors","page_number":47,"box":{"x":116,"y":76,"width":53,"height":8}},{"id":"6eff3acc-033b-4fc1-930b-ef2a6d3e1153","block_type":"box","text":"Experience, Qualifications and Skills","page_number":47,"box":{"x":276,"y":76,"width":212,"height":10}},{"id":"58f518cb-5029-49c0-8ac5-dfc93182d76c","block_type":"box","text":"Lori Richards Lori Richards has more than 30 years of experience in the financial services industry, most notably as \r\nhff hfff ld f h","page_number":47,"box":{"x":116,"y":94,"width":747,"height":11}},{"id":"170cdabb-e9f0-4c61-843a-b1f661b86c53","block_type":"box","text":"ypy, y \r\nthe first Director of the Office of Compliance Inspections and Examinations (“OCIE”) of the Securities\r\nd hfhf h","page_number":47,"box":{"x":276,"y":104,"width":596,"height":10}},{"id":"0dc481cb-6896-4c3c-84e8-1a3c878c008c","block_type":"box","text":"pp() \r\nand Exchange Commission (“SEC”) from 1995 to 2009. During 14 years as the Director of OCIE, she\r\nld hdhfdl fdhdfd","page_number":47,"box":{"x":276,"y":114,"width":594,"height":10}},{"id":"d5e4b67a-a8b5-447e-b250-635325139c55","block_type":"box","text":"g() g y\r\nled the SEC’s nationwide examination oversight program for advisers, mutual funds, hedge funds,\r\nbkdlk hd hdfhfhh","page_number":47,"box":{"x":276,"y":124,"width":566,"height":10}},{"id":"7dd1feb4-2d6d-4797-b49d-2654081e1d96","block_type":"box","text":"gpg, , g,\r\nbroker-dealers, stock exchanges, and other industry firms. Prior to that, from 1985 to 1995, she held\r\nlhldAfffhfl","page_number":47,"box":{"x":276,"y":133,"width":585,"height":11}},{"id":"95496956-c8b4-41c5-90d7-00f7f7d8ebf2","block_type":"box","text":", g, y , , \r\nvarious roles at the SEC, including Associate Director for Enforcement for the SEC’s Pacific Regional\r\nffd d dhhAhl","page_number":47,"box":{"x":276,"y":143,"width":585,"height":10}},{"id":"a48e4bd0-b002-4556-a067-8fc29aa26ebd","block_type":"box","text":", g g\r\nOffice and executive assistant and senior advisor to then SEC Chairman Arthur Levitt. More recently,\r\nhdd hf lfff hAd lh lbl l","page_number":47,"box":{"x":276,"y":153,"width":590,"height":10}},{"id":"c2b00287-500d-4d4e-a082-1926f5ef0dde","block_type":"box","text":"y,\r\nMs. Richards served as Chief Compliance Officer of the Asset and Wealth Management global lines of\r\nbhfhhld lbl l","page_number":47,"box":{"x":276,"y":163,"width":594,"height":10}},{"id":"1031e2dd-e4df-4bb7-b7c3-234e7ddebad5","block_type":"box","text":"pgg\r\nbusiness at JPMorgan Chase & Co. from 2013 to 2018 where she led its global compliance program,\r\ndd bldlk d","page_number":47,"box":{"x":276,"y":172,"width":586,"height":11}},{"id":"757e7116-b6f9-4f35-84c2-7f50c25be582","block_type":"box","text":"Jggppg,\r\nadvised business leaders on compliance issues, oversaw risk assessment, monitoring, testing and training,\r\nd d lhh lddhdd bf h","page_number":47,"box":{"x":276,"y":182,"width":606,"height":10}},{"id":"8e91c7d3-62a3-49c6-a60d-c00322a9bd65","block_type":"box","text":"p, , g, g \r\nand maintained relationships with regulators. In addition, Ms. Richards served as a member of the\r\nl Addl f hl dlAhAf","page_number":47,"box":{"x":276,"y":192,"width":570,"height":10}},{"id":"ade02ca6-29e8-42b3-8a17-11eb8322565d","block_type":"box","text":"pg, \r\nNational Adjudicatory Council of the Financial Industry Regulatory Authority (FINRA) from 2019 to\r\nd hld hhd hdhhfh","page_number":47,"box":{"x":276,"y":202,"width":591,"height":10}},{"id":"aa9302cd-579d-493d-911d-83ca0a215679","block_type":"box","text":"jy y gy y () \r\n2022 and held the chair and vice chair posts during her tenure. Prior thereto, from 2010 to 2013, she\r\nl hd ldf A","page_number":47,"box":{"x":276,"y":211,"width":586,"height":11}},{"id":"4363e220-f3ad-40b4-b19b-f20794c5c5c3","block_type":"box","text":"pg , , \r\nwas a Principal at PricewaterhouseCoopers LLP (“PwC”) and co-leader of its Asset Management\r\nlAhd bd f fl ld","page_number":47,"box":{"x":276,"y":221,"width":562,"height":10}},{"id":"e6056978-d929-4deb-94c4-f6fd209bb09b","block_type":"box","text":"pp() g\r\nRegulatory group. At PwC, she assisted a broad range of financial services clients in designing and\r\nlk d ld fl","page_number":47,"box":{"x":276,"y":231,"width":569,"height":10}},{"id":"9212d12f-2c02-40f6-a3e4-378760c540ef","block_type":"box","text":"gy gp, gg\r\nimplementing risk management and compliance programs, and preparing for new regulatory\r\nThhdd hh hd hk","page_number":47,"box":{"x":276,"y":241,"width":536,"height":10}},{"id":"16bb55e2-0e06-4a1b-bef8-3ba9615c0f06","block_type":"box","text":"pg gppg, ppg gy\r\nexpectations. These positions have provided her with insight and perspective on the markets and the\r\nll ld lddhd","page_number":47,"box":{"x":276,"y":250,"width":580,"height":11}},{"id":"efb160d8-2f9f-4025-8c92-a8e56d99384a","block_type":"box","text":"pppgpp\r\neconomy, as well as asset management regulation and compliance. In addition, Ms. Richards serves as a\r\nbf hAdd hl","page_number":47,"box":{"x":276,"y":260,"width":601,"height":10}},{"id":"d9be8970-6466-4da4-adac-b6633be518fb","block_type":"box","text":"y, ggp\r\nmember of the Audit Committee and the Compliance Committee.","page_number":47,"box":{"x":276,"y":270,"width":379,"height":10}},{"id":"9f834395-1849-46e8-854b-e71581105aeb","block_type":"box","text":"Mark Stalnecker Mark Stalnecker has gained a wealth of experience in investing and asset management from his over \r\nf hhf fff hf lll fh","page_number":47,"box":{"x":116,"y":285,"width":740,"height":10}},{"id":"2d2bbe0f-b916-4ac3-acd1-333a0d1b9605","block_type":"box","text":"gpg g\r\n13 years of service as the Chief Investment Officer of the University of Delaware as well as from his\r\nh lddd","page_number":47,"box":{"x":277,"y":295,"width":575,"height":10}},{"id":"6a2116ae-fd36-4ae6-9885-4721d5c9385a","block_type":"box","text":"yy \r\nvarious positions with First Union Corporation, including Senior Vice President and State Investment\r\nf AdThd bffhd h","page_number":47,"box":{"x":276,"y":305,"width":586,"height":10}},{"id":"f0b3ddf1-a229-4fdf-adee-616ad9c0b32e","block_type":"box","text":"pp, g \r\nDirector of First Investment Advisors. The Board benefits from his experience and perspective as the\r\nhf fff dd fhhhd f","page_number":47,"box":{"x":276,"y":314,"width":580,"height":11}},{"id":"e70c5239-d9dc-4d57-a304-bf16dde33815","block_type":"box","text":"ppp\r\nChief Investment Officer of a university endowment and from the oversight experience he gained from\r\nd fbd","page_number":47,"box":{"x":276,"y":324,"width":593,"height":10}},{"id":"e2803499-94fc-4309-bab6-486ba26a82c6","block_type":"box","text":"y \r\nservice on various private and non-profit boards.","page_number":47,"box":{"x":276,"y":334,"width":282,"height":10}},{"id":"d187fd0d-cbaa-48fc-80da-f8a24a0ed5db","block_type":"box","text":"Kenneth L. Urish Kenneth L. Urish has served for over 15 years on the boards of registered investment companies, most \r\nlbf hbdf lkkdd dd dfd","page_number":47,"box":{"x":116,"y":349,"width":751,"height":10}},{"id":"d9f2831f-92ce-4b15-b96b-83f987db6853","block_type":"box","text":"ygp\r\nrecently as a member of the boards of certain BlackRock-advised Funds and predecessor funds,\r\nldhllkk fdhf bl","page_number":47,"box":{"x":276,"y":359,"width":550,"height":10}},{"id":"b106d960-a310-4182-af28-4bcd2f8368e8","block_type":"box","text":"y p,\r\nincluding the legacy BlackRock funds. He has over 30 years of experience in public accounting.\r\nh hd bf d lfh h","page_number":47,"box":{"x":276,"y":368,"width":551,"height":11}},{"id":"f22faca5-dd93-437f-8767-39031628a6fc","block_type":"box","text":"g gy yppg\r\nMr. Urish has served as a managing member of an accounting and consulting firm. Mr. Urish has been\r\ndd bhAdbdfl h dfd","page_number":47,"box":{"x":276,"y":378,"width":594,"height":10}},{"id":"827a93ef-7fab-40c1-a5f2-9d36790ade35","block_type":"box","text":"gg g g \r\ndetermined by the Audit Committee to be an audit committee financial expert, as such term is defined in\r\nhlbll","page_number":47,"box":{"x":276,"y":388,"width":604,"height":10}},{"id":"48dc4ec8-cecb-44c5-85fb-365cc94f5e95","block_type":"box","text":"y \r\nthe applicable Commission rules.","page_number":47,"box":{"x":276,"y":398,"width":191,"height":10}},{"id":"e1827182-688b-47a4-bafd-d943b0f931ed","block_type":"box","text":"Claire A. Walton Claire A. Walton has over 25 years of experience in investment management. She has served as the Chief \r\nffd hf l fff bAf","page_number":47,"box":{"x":116,"y":413,"width":767,"height":10}},{"id":"e12ee1f4-0406-44cd-a569-1719cfe12765","block_type":"box","text":"ypg\r\nOperating Officer and Chief Financial Officer of Liberty Square Asset Management, LP from 1998 to\r\nhld lhd","page_number":47,"box":{"x":276,"y":422,"width":588,"height":11}},{"id":"cb603070-d411-4826-8357-5d0ba0f904bd","block_type":"box","text":"pg y qg, \r\n2015, an investment manager that specialized in long/short non-U.S. equity investments, and was an\r\nd l f bl ff","page_number":47,"box":{"x":276,"y":432,"width":580,"height":10}},{"id":"d05a763e-4bf0-49fa-a090-b0c298875936","block_type":"box","text":", gpgqy , \r\nowner and General Partner of Neon Liberty Capital Management, LLC from 2003 to 2023, a firm\r\nflhlbl d fkThh","page_number":47,"box":{"x":276,"y":442,"width":571,"height":10}},{"id":"eb3e1be5-e413-406e-9af0-e6f2686069e9","block_type":"box","text":"y pg, , \r\nfocusing on long/short equities in global emerging and frontier markets. These positions have provided\r\nhh hd hkd hlhbdd b","page_number":47,"box":{"x":276,"y":452,"width":594,"height":10}},{"id":"238202e5-0677-4a81-857f-dd30f59c5390","block_type":"box","text":"g gqggg pp\r\nher with insight and perspective on the markets and the economy. Ms. Walton has been determined by\r\nhAdbdfl h dfd hlbl","page_number":47,"box":{"x":276,"y":461,"width":594,"height":11}},{"id":"8720ac77-b1dc-49d2-a71b-d4811c164b4f","block_type":"box","text":"gppyy\r\nthe Audit Committee to be an audit committee financial expert, as such term is defined in the applicable\r\nl","page_number":47,"box":{"x":276,"y":471,"width":602,"height":10}},{"id":"1c193b7f-0329-4bd2-a8f6-09f0dd58a0a4","block_type":"box","text":"Commission rules.","page_number":47,"box":{"x":276,"y":481,"width":106,"height":8}},{"id":"bf40b635-9d6b-40f9-af65-882b32b42111","block_type":"box","text":"Directors Elect","page_number":47,"box":{"x":116,"y":498,"width":87,"height":8}},{"id":"76f56d48-cce1-41a6-84a4-73007884e544","block_type":"box","text":"Jeffrey Jarczyk Mr. Jarczyk is a CPA and has more than 30 years of experience in the financial services industry, \r\nlddlhhddffhhf A","page_number":47,"box":{"x":115,"y":513,"width":721,"height":11}},{"id":"635fd2ae-88da-4db0-bd29-fe22df9a20cf","block_type":"box","text":"Jyypy, including over 19 years at Fidelity Investments, where he served, at different times, as the Chief Auditor\r\nd hhf Afff dlk","page_number":47,"box":{"x":276,"y":523,"width":600,"height":10}},{"id":"2d8a15db-7ff6-496e-abef-f91b59521a7b","block_type":"box","text":"g yy , , , \r\nand the Chief Accounting Officer of Fidelity Investments’ parent company, FMR LLC. Prior to working\r\ndlk ld AhAdfl","page_number":47,"box":{"x":276,"y":533,"width":602,"height":10}},{"id":"b663aaf3-e3b8-4ec8-be06-e1cbf210a043","block_type":"box","text":"g y ppy, \r\nat Fidelity, Mr. Jarczyk was a partner at Deloitte and Arthur Andersen for approximately 17 years.\r\nThhlld hk lh dd k d","page_number":47,"box":{"x":276,"y":543,"width":573,"height":10}},{"id":"7df96510-220e-4a71-8073-fdb1c83a1a5a","block_type":"box","text":"y, Jypppy y\r\nThese positions have allowed him to work extensively with audit and risk committees and company\r\nhldfd kffl","page_number":47,"box":{"x":276,"y":552,"width":578,"height":11}},{"id":"0e536b49-6a9f-41e6-a6cf-71fdb49c4ed5","block_type":"box","text":"py \r\nexecutives helping to identify, manage and mitigate risks for financial services companies.","page_number":47,"box":{"x":276,"y":562,"width":517,"height":10}},{"id":"6efa553d-a2db-47f4-80f6-04565acc0f13","block_type":"box","text":"Marc D. Stern","page_number":47,"box":{"x":116,"y":578,"width":82,"height":7}},{"id":"7ee56608-65fe-45b2-b542-ca9ec6e01b6a","block_type":"box","text":"Mr. Stern has more than 30 years of experience in inve\r\nhf ffTlh","page_number":47,"box":{"x":276,"y":577,"width":307,"height":10}},{"id":"e0889107-5e0a-46e0-82f7-f94459b0eb00","block_type":"box","text":"sting and asset management. Mr. Stern served as the \r\nbfh","page_number":47,"box":{"x":584,"y":577,"width":293,"height":10}},{"id":"c47e9f42-6982-470d-8290-1ca8974452f8","block_type":"box","text":"yp\r\nChief Executive Officer at Bessemer Trust, a wealth ma\r\nd hfbd","page_number":47,"box":{"x":276,"y":587,"width":310,"height":10}},{"id":"424e1660-e57b-4cb1-b904-6497c507fe5c","block_type":"box","text":"g g\r\nnagement business, for 13 years. During his tenure \r\nd f dhd hbdd","page_number":47,"box":{"x":587,"y":587,"width":283,"height":10}},{"id":"d89e66c1-5d61-4f86-afe2-bf057856f98d","block_type":"box","text":", g, yg \r\nat Bessemer Trust, Mr. Stern served on the firm’s board of directors, chaired the board’s trust and\r\nd ld hfld hf","page_number":47,"box":{"x":276,"y":597,"width":549,"height":10}},{"id":"2b525e5b-f171-4f90-9d10-6f50f83ef1cb","block_type":"box","text":", \r\ninvestment committee, and led the firm’s executi\r\nfffhhh","page_number":47,"box":{"x":276,"y":606,"width":271,"height":10}},{"id":"65f3306a-eae7-4381-923a-0d16720bd041","block_type":"box","text":", \r\nve committee. He also served as Bessemer’s Chief","page_number":47,"box":{"x":548,"y":606,"width":276,"height":8}},{"id":"44d4a7e0-2915-45ea-95c5-b734b79adecd","block_type":"box","text":", \r\nInvestment Officer for 8 years, where he was Chair o\r\nblfll lld","page_number":47,"box":{"x":276,"y":616,"width":297,"height":10}},{"id":"901e7976-b874-4ace-96fb-0cbaf917df6c","block_type":"box","text":"f the Investment Policy and Strategy Committee with \r\nld hf h","page_number":47,"box":{"x":574,"y":616,"width":295,"height":10}},{"id":"969e91f2-4b0b-45ee-889a-15969fc6c2a3","block_type":"box","text":"y, \r\nresponsibility for overall asset allocation and investm\r\nlAll","page_number":47,"box":{"x":276,"y":626,"width":298,"height":10}},{"id":"0a22bd50-8c89-4f7a-a0bb-174683350360","block_type":"box","text":"y gy \r\nent strategy. Mr. Stern also served as Chair of the \r\nThdh h","page_number":47,"box":{"x":574,"y":626,"width":278,"height":10}},{"id":"c6297b2d-b6de-434a-a4d8-147aa8d7c1a2","block_type":"box","text":"py \r\nPrivate Clients Investment group at AllianceBernstein\r\nh","page_number":47,"box":{"x":276,"y":636,"width":299,"height":10}},{"id":"0dbed759-f6be-484d-97cf-6ceb47eb77ee","block_type":"box","text":"gy\r\n. These positions provide Mr. Stern with insight and \r\nd fd","page_number":47,"box":{"x":576,"y":636,"width":291,"height":10}},{"id":"7f850f83-f4b7-4785-9f97-687548726ce1","block_type":"box","text":"gp pp\r\nperspective into investment management, the economy, and fiduciary governance.","page_number":47,"box":{"x":276,"y":645,"width":458,"height":11}},{"id":"9c456f4f-4679-424e-ae72-9a17d1fc292e","block_type":"box","text":"Interested Directors","page_number":47,"box":{"x":116,"y":663,"width":115,"height":8}},{"id":"4f1f5c7f-a56e-464c-88ef-838e0cde0b88","block_type":"box","text":"Robert Fairbairn Robert Fairbairn has more than 25 years of experience with BlackRock, Inc. and over 30 years of \r\nfd lbh","page_number":47,"box":{"x":116,"y":678,"width":725,"height":10}},{"id":"37d3a33b-0e55-4603-a593-a01e84ad524f","block_type":"box","text":"yp, y\r\nexperience in finance and asset management. In particular, Mr. Fairbairn’s positions as Vice Chairman\r\nf lkkbf lkklbl d hf lkk","page_number":47,"box":{"x":276,"y":688,"width":594,"height":10}},{"id":"3a43d1c6-74bb-4b34-ac17-5e6f389e3595","block_type":"box","text":"pgp, p\r\nof BlackRock, Inc., Member of BlackRock’s Global Operating Committee and Co-Chair of BlackRock’s\r\nl dhd h lh f l bkldd","page_number":47,"box":{"x":276,"y":697,"width":603,"height":11}},{"id":"1af33778-9b38-4412-a9e5-12c605c80b3f","block_type":"box","text":", , pg \r\nHuman Capital Committee provide the Board with a wealth of practical business knowledge and\r\nldhddbhlbl d h","page_number":47,"box":{"x":276,"y":707,"width":561,"height":10}},{"id":"79e4c08e-fa98-4672-8d6f-9538c9c37405","block_type":"box","text":"pppg\r\nleadership. In addition, Mr. Fairbairn has global investment management and oversight experience\r\nhh hfbf lkklbl lbl","page_number":47,"box":{"x":276,"y":717,"width":571,"height":10}},{"id":"1d2aa9d2-dca3-456d-b1ee-9ce6f125d95b","block_type":"box","text":"p, gggp\r\nthrough his former positions as Member of BlackRock’s Global Executive Committee, Global Head of\r\nlkkl d h\r\n® b\r\nd f lkklbl lhf","page_number":47,"box":{"x":276,"y":727,"width":594,"height":10}},{"id":"9c038193-1578-4342-8d33-7bb3b0541f56","block_type":"box","text":"gp\r\nBlackRock’s Retail and iShares","page_number":47,"box":{"x":276,"y":736,"width":179,"height":8}},{"id":"85ca6a8e-9a50-4957-a7e4-477c66ebc546","block_type":"box","text":"®","page_number":47,"box":{"x":456,"y":736,"width":7,"height":6}},{"id":"48cf3acc-9315-41a2-a8b8-d63551501b9f","block_type":"box","text":", \r\nbusinesses, Head of BlackRock’s Global Client Group, Chairman of \r\nd hhlkk","page_number":47,"box":{"x":468,"y":736,"width":394,"height":11}},{"id":"a5c52e20-fc42-4611-82aa-c72a56e43fe0","block_type":"box","text":", p, \r\nBlackRock’s international businesses and his previous oversight over BlackRock’s Strategic Partner\r\nd dblbd bf","page_number":47,"box":{"x":276,"y":746,"width":572,"height":10}},{"id":"39177b56-a692-4bef-a43b-c45a37fb4400","block_type":"box","text":"pgg\r\nProgram and Strategic Product Management Group. Mr. Fairbairn also serves as a board member for\r\nhfdhlkk dl","page_number":47,"box":{"x":276,"y":756,"width":588,"height":10}},{"id":"7d2ad2b5-b6ba-4114-bbdb-dea465f15fae","block_type":"box","text":"gggp\r\nthe funds in the BlackRock Fixed-Income Complex.","page_number":47,"box":{"x":276,"y":766,"width":299,"height":10}},{"id":"058a3cc5-41a6-4d27-975b-06c155812e4a","block_type":"box","text":"John M. Perlowski","page_number":47,"box":{"x":115,"y":781,"width":109,"height":10}},{"id":"445a4d17-344c-433b-899d-767a85931062","block_type":"box","text":"John M. Perlowski’s experience as Managing Direct\r\nlkk lbl Ad d","page_number":47,"box":{"x":275,"y":781,"width":292,"height":10}},{"id":"4e6fd7d7-a2f6-4a8e-bc37-355441feb460","block_type":"box","text":"or of BlackRock, Inc. since 2009, as the Head of \r\nd dd hf","page_number":47,"box":{"x":568,"y":781,"width":273,"height":10}},{"id":"30a2913c-3af4-4bfb-9700-187086c116d5","block_type":"box","text":"Jpgg \r\nBlackRock Global Accounting and Product Services \r\nfff hlkkdd ddh","page_number":47,"box":{"x":276,"y":791,"width":290,"height":10}},{"id":"4c387bd6-1191-4c11-b40a-09a29b17f861","block_type":"box","text":", , \r\nsince 2009, and as President and Chief Executive \r\nh ddf hlkk","page_number":47,"box":{"x":571,"y":791,"width":274,"height":9}},{"id":"92178b64-85ee-4fc2-87a4-7ec308ce258d","block_type":"box","text":"g \r\nOfficer of the BlackRock-advised Funds provides \r\ndd dhd hb","page_number":47,"box":{"x":276,"y":800,"width":275,"height":11}},{"id":"9290378f-16c9-42b9-b936-fd0df75d83ee","block_type":"box","text":", \r\nhim with a strong understanding of the BlackRock- \r\nd lfhlkkdd","page_number":47,"box":{"x":555,"y":800,"width":288,"height":11}},{"id":"68e335f3-013d-4b50-9e50-bcfdb8ef3ba4","block_type":"box","text":"p\r\nadvised Funds, their operations, and the business and regu\r\nlkd","page_number":47,"box":{"x":276,"y":810,"width":327,"height":10}},{"id":"85205a24-6499-4868-9904-c5b9ed1ec093","block_type":"box","text":"g g \r\nlatory issues facing the BlackRock-advised Funds. \r\nhf fff hlbl d","page_number":47,"box":{"x":604,"y":810,"width":277,"height":10}},{"id":"68ca077d-eea1-450b-9142-7bccc0f5eae2","block_type":"box","text":", p, \r\nMr. Perlowski’s prior position as Managing Director \r\nldhAd h","page_number":47,"box":{"x":276,"y":820,"width":296,"height":10}},{"id":"54ce953b-4cdc-4c13-96ff-dc21c3d70cb6","block_type":"box","text":"gy g \r\nand Chief Operating Officer of the Global Product \r\nfTd d","page_number":47,"box":{"x":576,"y":820,"width":285,"height":10}},{"id":"c4125b6f-dc41-4c6f-bc11-f31fc43412e7","block_type":"box","text":"ppgg \r\nGroup at Goldman Sachs Asset Management, and his forme\r\nf hldhl dd f h","page_number":47,"box":{"x":276,"y":830,"width":337,"height":10}},{"id":"1cc7dd26-0439-4fb4-b610-cb675e347a27","block_type":"box","text":"pg \r\nr service as Treasurer and Senior Vice President","page_number":47,"box":{"x":614,"y":830,"width":265,"height":8}},{"id":"463f59bb-a662-4c55-bed7-a615a950d527","block_type":"box","text":"p g, \r\nof the Goldman Sachs Mutual Funds and as Director of the Goldman Sachs Offshore Funds provides the\r\nd h hbff hh hf hfl","page_number":47,"box":{"x":276,"y":839,"width":587,"height":11}},{"id":"4ec188be-4fb4-472e-aa28-836842e59273","block_type":"box","text":"Board with the benefit of his experience with the ma\r\nlklbd bfh","page_number":47,"box":{"x":276,"y":849,"width":294,"height":10}},{"id":"9900cb50-e33f-4962-af8a-3805ce6a329d","block_type":"box","text":"p\r\nnagement practices of other financial companies. \r\nfdhlkk dl","page_number":47,"box":{"x":570,"y":849,"width":273,"height":10}},{"id":"ecacdcf7-8f75-427e-8f3b-e1e9e6400f34","block_type":"box","text":"pgpp\r\nMr. Perlowski also serves as a board member for the funds in the BlackRock Fixed-Income Complex.\r\nlkbf lkklbl","page_number":47,"box":{"x":276,"y":859,"width":568,"height":10}},{"id":"45470364-69bd-4cd6-a27d-3ff9ee2d5f23","block_type":"box","text":"Mr. Perlowski is a member of BlackRock’s Global Executive Committee.","page_number":47,"box":{"x":276,"y":869,"width":408,"height":8}},{"id":"43e3e4bb-a052-4742-ae21-602946b9ffea","block_type":"box","text":"I-29","page_number":47,"box":{"x":485,"y":917,"width":28,"height":9}},{"id":"fdecb59b-1cd6-4f0b-af12-3b012fea9651","block_type":"box","text":"NM1026U-6004382-47/605","page_number":47,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"d3d58ce3-111f-4b38-a12b-e2d9612c3ff4","block_type":"box","text":"Biographical Information","page_number":48,"box":{"x":136,"y":79,"width":185,"height":13}},{"id":"ad9e4433-71d2-43da-8cb9-4812ece55b33","block_type":"box","text":"Certain biographical and other information relating to the Directors of the Company is set forth below,","page_number":48,"box":{"x":117,"y":105,"width":717,"height":12}},{"id":"b8e76179-da06-42ee-b4f3-ee9e5da2ea84","block_type":"box","text":"including their address and year of birth, principal occupations for at least the last five years, length of 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Only portfolio managers who manage specified products and whose total compensation is","page_number":65,"box":{"x":116,"y":590,"width":766,"height":13}},{"id":"6d541ded-6b4e-4cd7-8972-c1f3bbd37eeb","block_type":"box","text":"above a specified threshold are eligible to participate in the deferred cash award program.","page_number":65,"box":{"x":116,"y":606,"width":620,"height":13}},{"id":"c6fbf384-0d93-4083-9eea-0626f4855307","block_type":"box","text":"Other Compensation Benefits.","page_number":65,"box":{"x":116,"y":629,"width":211,"height":13}},{"id":"6b6c1dcc-9636-4516-a00f-f99e80eebea7","block_type":"box","text":"In addition to base salary and discretionary incentive compensation, portfolio","page_number":65,"box":{"x":332,"y":629,"width":538,"height":13}},{"id":"539e4a84-cbbf-4e88-936d-252b249cf2bb","block_type":"box","text":"managers may be eligible to receive or participate in one or more of the following:","page_number":65,"box":{"x":116,"y":645,"width":569,"height":12}},{"id":"8547e49f-d3c7-4f70-847a-78dddf52f734","block_type":"box","text":"Incentive Savings Plans","page_number":65,"box":{"x":116,"y":668,"width":157,"height":13}},{"id":"f2f0c1ef-30c8-4d07-bc56-d22c41f95cdb","block_type":"box","text":"— BlackRock, Inc. has created a variety of incentive savings plans in which BlackRock","page_number":65,"box":{"x":278,"y":668,"width":587,"height":13}},{"id":"02341bcb-285a-40c2-8c79-d44f2c83c5b0","block_type":"box","text":"employees are eligible to participate, including a 401(k)","page_number":65,"box":{"x":116,"y":683,"width":374,"height":13}},{"id":"3d10fb4c-5740-46da-8615-15666454c990","block_type":"box","text":"plan, the BlackRock Retirement Savings Plan (RSP), and","page_number":65,"box":{"x":495,"y":683,"width":383,"height":13}},{"id":"e8ea6735-39a1-49a5-a7df-549ef1c248ae","block_type":"box","text":"the BlackRock Employee Stock Purchase Plan (ESPP). The employer contribution components of the RSP","page_number":65,"box":{"x":116,"y":699,"width":715,"height":13}},{"id":"10a18c12-1d98-4ebe-8c70-a8282bdaeb79","block_type":"box","text":"include a company match equal to 50% of the first 8% of eligible pay contributed to the plan capped at $5,000","page_number":65,"box":{"x":116,"y":714,"width":756,"height":13}},{"id":"95bcdc88-da66-4b0a-a7a3-f339e6dbf199","block_type":"box","text":"per year, and a company retirement contribution equa","page_number":65,"box":{"x":116,"y":730,"width":367,"height":13}},{"id":"a800131e-429e-408b-abc6-ef1d622a3024","block_type":"box","text":"l to 3-5% of eligible compensation up to the Internal","page_number":65,"box":{"x":484,"y":730,"width":357,"height":13}},{"id":"0a385364-0ed1-42dc-9924-6fd58c848e38","block_type":"box","text":"Revenue Service limit ($350,000 for 2025). The RSP offers","page_number":65,"box":{"x":116,"y":745,"width":399,"height":13}},{"id":"5e486e6c-7f86-4c79-ab2f-e8233e72df26","block_type":"box","text":"a range of investment options, including registered","page_number":65,"box":{"x":520,"y":745,"width":341,"height":13}},{"id":"a5746d3c-d32d-4cf7-98d2-d3a6d0e128ac","block_type":"box","text":"investment companies and collective investment funds","page_number":65,"box":{"x":116,"y":761,"width":366,"height":13}},{"id":"070a5c1a-88d8-443a-8dc4-f3f5d3daaf17","block_type":"box","text":"managed by the firm. BlackRock contributions follow the","page_number":65,"box":{"x":486,"y":761,"width":392,"height":13}},{"id":"0be9a412-a118-4da5-8441-40eadb859960","block_type":"box","text":"investment direction set by participants for their own c","page_number":65,"box":{"x":116,"y":776,"width":371,"height":13}},{"id":"33940b7a-7cc6-4fb3-98cd-0b4a9f75aa16","block_type":"box","text":"ontributions or, absent participant investment direction,","page_number":65,"box":{"x":487,"y":776,"width":379,"height":13}},{"id":"a6af2df8-bcad-47f9-9b0c-9e696273d6bc","block_type":"box","text":"are invested into a target date fund that corresponds to, or is closest to, the year in which the participant attains","page_number":65,"box":{"x":116,"y":792,"width":754,"height":13}},{"id":"79e6719d-1ee6-45cf-b7c2-4746e467e051","block_type":"box","text":"age 65. The ESPP allows for investment in BlackRock common stock at a 5% discount on the fair market value","page_number":65,"box":{"x":116,"y":807,"width":757,"height":13}},{"id":"044b765a-01ff-4b65-860f-8054e20b70a7","block_type":"box","text":"of the stock on the purchase date. Annual participation in the ESPP is limited to the purchase of 1,000 shares of","page_number":65,"box":{"x":116,"y":823,"width":757,"height":13}},{"id":"d2a483f8-048e-480d-8ba8-8619f202f6b5","block_type":"box","text":"common stock or a dollar value of $25,000 based on its fair market value on the purchase date. With the","page_number":65,"box":{"x":116,"y":838,"width":713,"height":13}},{"id":"2422dc5f-5324-420b-8c79-104f81cabcdc","block_type":"box","text":"exception of Mr. Andrews and Mses. Greenen and Treharne, the portfolio managers of these funds are eligible","page_number":65,"box":{"x":116,"y":854,"width":749,"height":13}},{"id":"9d851622-ef0f-4fb4-a70c-c718893901cd","block_type":"box","text":"to participate in these plans.","page_number":65,"box":{"x":116,"y":869,"width":189,"height":13}},{"id":"7d07c72f-6c9d-4574-95ff-8a9e00fee8b4","block_type":"box","text":"I-47","page_number":65,"box":{"x":485,"y":917,"width":29,"height":9}},{"id":"60d8f014-c950-432c-84e3-91bdfe8c6b01","block_type":"box","text":"NM1026U-6004382-65/605","page_number":65,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"2d13083f-0e70-4771-9f0d-b76764b61c2e","block_type":"box","text":"Hong Kong-based portfolio managers are also eligible to","page_number":66,"box":{"x":116,"y":79,"width":393,"height":13}},{"id":"8db5c6da-e7c6-4a5e-9571-8fe5d072ae0f","block_type":"box","text":"participate in broad-based plans offered generally to","page_number":66,"box":{"x":514,"y":79,"width":362,"height":13}},{"id":"62a843d1-210b-4e0f-bf23-70c18b1190db","block_type":"box","text":"BlackRock employees, including broad-based retirement, health and other employee benefit plans. For","page_number":66,"box":{"x":116,"y":94,"width":710,"height":13}},{"id":"1ec549c8-b7be-4f3e-bfd9-ec3b0d27074d","block_type":"box","text":"example, BlackRock Inc. has created a variety of incentive savings plans in which employees are eligible to","page_number":66,"box":{"x":116,"y":110,"width":737,"height":13}},{"id":"00b7e608-351e-4651-9267-740dd59fba4b","block_type":"box","text":"participate, including the Hong Kong Employee Retirement Plan (ERP) that includes the Mandatory","page_number":66,"box":{"x":116,"y":125,"width":696,"height":13}},{"id":"6f5f0aa7-548f-4f77-9307-2775444f15dd","block_type":"box","text":"Provident Fund (MPF) plan and BlackRock ORSO Retirement Plan (ORSO), and the BlackRock Employee","page_number":66,"box":{"x":116,"y":141,"width":745,"height":13}},{"id":"ec4de93d-754e-4f54-970e-a354539b0fd2","block_type":"box","text":"Stock Purchase Plan (ESPP). BlackRock contributes 5% to the ERP and will match 2~5% employee’s monthly","page_number":66,"box":{"x":116,"y":156,"width":766,"height":13}},{"id":"b6dbf191-1399-492b-984a-b2e6d5e6035a","block_type":"box","text":"voluntary contribution. The ORSO offers a range of","page_number":66,"box":{"x":116,"y":172,"width":364,"height":13}},{"id":"5e8b393f-25a7-4300-be69-480ef7e29cc8","block_type":"box","text":"investment options and the funds are managed by the","page_number":66,"box":{"x":484,"y":172,"width":371,"height":13}},{"id":"f23d8398-6a7e-4533-a412-86363566f2c8","block_type":"box","text":"firm. BlackRock contributions follow the investment direc","page_number":66,"box":{"x":116,"y":187,"width":404,"height":10}},{"id":"387ab766-8b29-433c-a5de-2fca80365a9a","block_type":"box","text":"tion set by participants for their own contributions.","page_number":66,"box":{"x":520,"y":187,"width":356,"height":13}},{"id":"56efdf0d-1703-4fa9-8ce8-2858326a95e7","block_type":"box","text":"The ESPP allows for investment in BlackRock common stock at a 5% discount on the fair market value of the","page_number":66,"box":{"x":116,"y":203,"width":765,"height":10}},{"id":"d75380de-5e92-4539-8b83-14d0ef7f4b3b","block_type":"box","text":"stock on the purchase date. Annual participation in the ESPP is limited to the purchase of 1,000 shares of","page_number":66,"box":{"x":116,"y":218,"width":731,"height":13}},{"id":"cecd9af1-7de7-4763-952d-657bf4ed4440","block_type":"box","text":"common stock or a US dollar value of $25,000 based on its fair market value on the purchase date. Mr.","page_number":66,"box":{"x":116,"y":234,"width":720,"height":13}},{"id":"cb17bcb5-174d-4a1c-ab72-3100f5bd49cb","block_type":"box","text":"Andrews is eligible to participate in these plans.","page_number":66,"box":{"x":116,"y":249,"width":329,"height":13}},{"id":"4b6126fd-a3f1-418a-bf4e-45122c839a81","block_type":"box","text":"United Kingdom-based portfolio managers are also elig","page_number":66,"box":{"x":116,"y":273,"width":384,"height":12}},{"id":"925d3dff-c3ef-429a-ab6f-669ab67ac970","block_type":"box","text":"ible to participate in broad-based plans offered","page_number":66,"box":{"x":500,"y":273,"width":324,"height":12}},{"id":"b72a189c-6952-424f-ab32-3e04129e833a","block_type":"box","text":"generally to BlackRock employees, including broad-based","page_number":66,"box":{"x":116,"y":288,"width":401,"height":13}},{"id":"8087a9e1-c638-4807-9ccf-ba05f3cf98ac","block_type":"box","text":"retirement, health and other employee benefit plans.","page_number":66,"box":{"x":521,"y":288,"width":361,"height":13}},{"id":"9b1c9e08-053f-4613-ac31-be22862f52bc","block_type":"box","text":"For example, BlackRock has created a variety of incentive savings plans in which BlackRock employees are","page_number":66,"box":{"x":116,"y":304,"width":744,"height":12}},{"id":"9c933959-4899-48e1-9a00-5dd2e8ebf173","block_type":"box","text":"eligible to participate, including the BlackRock Retirement Savings Plan (RSP) and the BlackRock Employee","page_number":66,"box":{"x":116,"y":319,"width":750,"height":13}},{"id":"3b73dfd0-9240-4325-aaaf-27cf409d64fb","block_type":"box","text":"Stock Purchase Plan (ESPP). The employer contribution to the RSP is between 10% and 15% of eligible pay","page_number":66,"box":{"x":116,"y":335,"width":751,"height":12}},{"id":"3471209f-384e-471a-8579-3406d745ecfd","block_type":"box","text":"capped at £160,000 per annum. The RSP offers a range of investment options, including several collective","page_number":66,"box":{"x":116,"y":350,"width":735,"height":13}},{"id":"329ece0a-b8b5-4213-908d-0669a7347aa7","block_type":"box","text":"investment funds managed by the firm. BlackRock c","page_number":66,"box":{"x":116,"y":366,"width":362,"height":12}},{"id":"c1adce5e-b0d6-4140-9ab1-72387188a110","block_type":"box","text":"ontributions follow the investment direction set by","page_number":66,"box":{"x":479,"y":366,"width":350,"height":12}},{"id":"0b751d26-a93f-4791-8b54-0d7d99bac09d","block_type":"box","text":"participants for their own contributions or, in the absence of an investment election being made, are invested","page_number":66,"box":{"x":116,"y":381,"width":754,"height":13}},{"id":"88929390-4179-4ade-a847-6a18ba75fed3","block_type":"box","text":"into a target date fund that corresponds to, or is closest to, the year in which the participant attains age 65.","page_number":66,"box":{"x":116,"y":397,"width":741,"height":12}},{"id":"64abdcf3-e1d3-4b5c-aab9-b68edd6002ab","block_type":"box","text":"The ESPP allows for investment in BlackRock common stock at a 5% discount on the fair market value of the","page_number":66,"box":{"x":116,"y":412,"width":765,"height":10}},{"id":"9e81da81-1c3d-4bab-b46c-db7c32f81a9c","block_type":"box","text":"stock on the purchase date. Annual participation in the ESPP is limited to the purchase of 1,000 shares of","page_number":66,"box":{"x":116,"y":428,"width":731,"height":12}},{"id":"b085ce0e-b884-4039-b5ce-ae168ae43c94","block_type":"box","text":"common stock or a US dollar value of $25,000 based on its fair market value on the purchase date. Mses.","page_number":66,"box":{"x":116,"y":443,"width":733,"height":13}},{"id":"6851cd25-70f4-4eae-bbfa-bc118b2d9ae8","block_type":"box","text":"Greenen and Treharne is eligible to participate in these plans.","page_number":66,"box":{"x":117,"y":459,"width":423,"height":12}},{"id":"7469843c-80ed-4d70-92c6-a6b0cb53d3b5","block_type":"box","text":"Portfolio Manager Potential Material Conflicts of Interest","page_number":66,"box":{"x":136,"y":487,"width":427,"height":13}},{"id":"ea138660-6efb-4d10-84c9-5d68c6ba43fa","block_type":"box","text":"BlackRock has built a professional working environm","page_number":66,"box":{"x":116,"y":513,"width":365,"height":13}},{"id":"dcc7f5a9-7206-4b46-b9be-3f4dc9206bbe","block_type":"box","text":"ent, firm-wide compliance culture and compliance","page_number":66,"box":{"x":482,"y":513,"width":339,"height":13}},{"id":"b2ad99ae-f5d3-44e7-8a4e-692b74426ee6","block_type":"box","text":"procedures and systems designed to protect against potential incentives that may favor one account over another.","page_number":66,"box":{"x":116,"y":528,"width":766,"height":13}},{"id":"4b3c300a-fc9d-4125-af6d-247ab1f26858","block_type":"box","text":"BlackRock has adopted policies and procedures that address the allocation of investment opportunities,","page_number":66,"box":{"x":116,"y":544,"width":701,"height":13}},{"id":"853ad3af-ba08-429c-b6f1-3ffbde2f035f","block_type":"box","text":"execution of portfolio transactions, personal trading by","page_number":66,"box":{"x":116,"y":559,"width":374,"height":13}},{"id":"15e320a7-b3f2-46b8-81f0-b8942a9191e0","block_type":"box","text":"employees and other potential conflicts of interest that","page_number":66,"box":{"x":495,"y":559,"width":368,"height":13}},{"id":"f4ef67bc-813c-4793-b16f-fa7b053090f5","block_type":"box","text":"are designed to ensure that all client accounts are treated equitably over time. Nevertheless, BlackRock furnishes","page_number":66,"box":{"x":116,"y":575,"width":759,"height":13}},{"id":"b0686fc4-22a0-4df7-b9e5-60f2f4f56eb3","block_type":"box","text":"investment management and advisory services to numerous clients in addition to the Funds, and BlackRock may,","page_number":66,"box":{"x":116,"y":590,"width":766,"height":13}},{"id":"9bbcbb5c-aff5-4f24-a41d-2f565cfd7e4d","block_type":"box","text":"consistent with applicable law, make investment recommendations to other clients or accounts (including","page_number":66,"box":{"x":116,"y":606,"width":713,"height":13}},{"id":"938dfaae-6744-4c67-bde1-e5a388f2a547","block_type":"box","text":"accounts which are hedge funds or have performance or higher fees paid to BlackRock, or in which a portfolio","page_number":66,"box":{"x":116,"y":621,"width":750,"height":13}},{"id":"e88bd27a-a7dd-448a-8781-557e1b04f450","block_type":"box","text":"manager has have a personal interest in the receipt of such fees), which may be the same as or different from","page_number":66,"box":{"x":116,"y":637,"width":733,"height":13}},{"id":"a561a7e7-708e-4b4c-90a1-171dc2453980","block_type":"box","text":"those made to the Funds. In addition, BlackRock, its affiliates and significant shareholders and any officer,","page_number":66,"box":{"x":116,"y":652,"width":720,"height":13}},{"id":"b61c6fe9-afa3-416e-812d-2e5cbd625ccc","block_type":"box","text":"director, shareholder or employee may or may not have an interest in the securities whose purchase and sale","page_number":66,"box":{"x":116,"y":668,"width":732,"height":13}},{"id":"f853f806-9b9c-41c7-b98e-b902a730d49a","block_type":"box","text":"BlackRock recommends to the Funds. BlackRock, or any of its affiliates or significant shareholders, or any","page_number":66,"box":{"x":116,"y":683,"width":722,"height":13}},{"id":"c33b64af-a6cf-4e61-a436-42f004229b82","block_type":"box","text":"officer, director, shareholder, employee or any member of their families may take different actions than those","page_number":66,"box":{"x":116,"y":699,"width":738,"height":13}},{"id":"8ec6c3ee-5796-4b32-9af5-c2f1f1cf1022","block_type":"box","text":"recommended to the Funds by BlackRock with respect to the same securities. Moreover, BlackRock may refrain","page_number":66,"box":{"x":116,"y":714,"width":760,"height":13}},{"id":"b198f3ce-337b-489d-8d44-d6eec0f1f086","block_type":"box","text":"from rendering any advice or services concerning securities of companies of which any of BlackRock’s (or its","page_number":66,"box":{"x":116,"y":730,"width":735,"height":13}},{"id":"efec96bd-0a69-4ba8-b44a-9cf96bb18c75","block_type":"box","text":"affiliates’ or significant shareholders’) officers, directors or employees are directors or officers, or companies as to","page_number":66,"box":{"x":116,"y":745,"width":765,"height":13}},{"id":"4df9160a-9504-449c-bccd-68eb9cfd46a4","block_type":"box","text":"which BlackRock or any of its affiliates or significant shareholders or the officers, directors and employees of any","page_number":66,"box":{"x":116,"y":761,"width":766,"height":13}},{"id":"6e0596fd-d7c8-4992-aacb-5899350215fe","block_type":"box","text":"of them has any substantial economic interest or possesses","page_number":66,"box":{"x":116,"y":776,"width":394,"height":13}},{"id":"41de63a3-7a94-4083-b86a-1f154a03207f","block_type":"box","text":"material non-public information. Certain portfolio","page_number":66,"box":{"x":514,"y":776,"width":343,"height":13}},{"id":"263c39be-fa25-49dc-8cd8-4d96289789ab","block_type":"box","text":"managers also may manage accounts whose investment strategies may at times be opposed to the strategy","page_number":66,"box":{"x":116,"y":792,"width":716,"height":13}},{"id":"1dca24c0-26bb-4d54-bf05-553d013ebdea","block_type":"box","text":"utilized for a fund. It should also be noted that Messrs. Cooke, Koesterich, Mathieson, Menge, Rieder, Savi and","page_number":66,"box":{"x":116,"y":807,"width":757,"height":13}},{"id":"1516851b-d5ec-49b2-99ef-936bf4ad51a9","block_type":"box","text":"Andrews and Mses. Treharne and Greenen may be managing hedge fund and/or long only accounts, or may be","page_number":66,"box":{"x":116,"y":823,"width":754,"height":13}},{"id":"f688c96d-c963-43c9-bfac-7e6a4d1db590","block_type":"box","text":"part of a team managing hedge fund and/or long only accounts, subject to incentive fees. Messrs. Cooke,","page_number":66,"box":{"x":116,"y":838,"width":708,"height":13}},{"id":"07611e95-e8b3-4857-abbf-89b540965181","block_type":"box","text":"Koesterich, Mathieson, Menge, Rieder, Savi and Andrews and Mses. Treharne and Greenen may therefore be","page_number":66,"box":{"x":116,"y":854,"width":743,"height":13}},{"id":"7ec74e36-f12a-4a45-b713-bcb92a2ae861","block_type":"box","text":"entitled to receive a portion of any incentive fees earned on such accounts.","page_number":66,"box":{"x":116,"y":869,"width":500,"height":13}},{"id":"3d40aab1-56f1-4b88-9b48-d8a8b58fbaf9","block_type":"box","text":"I-48","page_number":66,"box":{"x":485,"y":917,"width":28,"height":9}},{"id":"97ee935b-bca8-4380-b6f2-7c08b6a6a315","block_type":"box","text":"NM1026U-6004382-66/605","page_number":66,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"f24f8613-f8a6-42e4-bd95-552feddd0c77","block_type":"box","text":"As a fiduciary, BlackRock owes a duty of loyalty to its clients and must treat each client fairly. When","page_number":67,"box":{"x":116,"y":79,"width":700,"height":13}},{"id":"a735630d-f276-4073-b1f8-e55aa25c6f72","block_type":"box","text":"BlackRock purchases or sells securities for more than one account, the trades must be allocated in a manner","page_number":67,"box":{"x":116,"y":94,"width":748,"height":13}},{"id":"670086d3-5ea0-4236-8bee-abf221dbd946","block_type":"box","text":"consistent with its fiduciary duties. BlackRock attempts to allocate investments in a fair and equitable manner","page_number":67,"box":{"x":116,"y":110,"width":762,"height":13}},{"id":"5cedce1a-1e96-45a2-a5d2-6ed793e65803","block_type":"box","text":"among client accounts, with no account receiving preferential treatment. To this end, BlackRock has adopted","page_number":67,"box":{"x":116,"y":125,"width":758,"height":13}},{"id":"86bb7bc3-d0a3-45c4-9548-987b0bb16557","block_type":"box","text":"policies that are intended to ensure reasonable efficiency in client transactions and provide BlackRock with","page_number":67,"box":{"x":116,"y":141,"width":741,"height":13}},{"id":"18f3205e-3aec-405d-9c24-d5827e50fc8b","block_type":"box","text":"sufficient flexibility to allocate investments in a manner that is consistent with the particular investment","page_number":67,"box":{"x":116,"y":156,"width":717,"height":13}},{"id":"ef6fbdd9-059a-4e17-ae24-f7c172c4145e","block_type":"box","text":"discipline and client base, as appropriate.","page_number":67,"box":{"x":116,"y":172,"width":284,"height":13}},{"id":"a177082e-3c92-48ab-a93e-75c2b44da5a7","block_type":"box","text":"Transfer Agency and Shareholders’ Administrative Services","page_number":67,"box":{"x":136,"y":197,"width":429,"height":13}},{"id":"bd4391a9-9c32-4636-bf32-191705d9feb1","block_type":"box","text":"BNY Mellon, which has its principal place of business at 118 Flanders Road, Westborough, MA 01581,","page_number":67,"box":{"x":116,"y":220,"width":724,"height":13}},{"id":"ed88b988-7b00-4e53-a402-3c813785348b","block_type":"box","text":"serves as the transfer and dividend disbursement agent for the Fund.","page_number":67,"box":{"x":116,"y":236,"width":471,"height":13}},{"id":"28cbe4a4-5fad-4e1f-a6b3-cdb0c2ab24e6","block_type":"box","text":"Accounting Services","page_number":67,"box":{"x":136,"y":261,"width":144,"height":13}},{"id":"e09867db-4bb0-4d57-84a3-6b5737c11abc","block_type":"box","text":"The Company has entered into an agreement with JPMorgan Chase Bank, N.A. (“JPM”) pursuant to which","page_number":67,"box":{"x":116,"y":284,"width":751,"height":13}},{"id":"f5bacd1d-0771-4f05-8e88-47e8b73e1d74","block_type":"box","text":"JPM provides certain accounting services to the Funds. The Manager provides certain accounting services to","page_number":67,"box":{"x":115,"y":300,"width":751,"height":13}},{"id":"864c0651-e13d-4eed-b190-a989c3f6146b","block_type":"box","text":"each Fund and each Fund reimburses the Manager for such services.","page_number":67,"box":{"x":116,"y":315,"width":472,"height":13}},{"id":"eb624386-1882-4834-aed9-1926cf3b8475","block_type":"box","text":"The table below shows the amount paid by the Company to JPM and the Manager for accounting services for","page_number":67,"box":{"x":116,"y":337,"width":765,"height":12}},{"id":"89b29dfb-229d-455c-b8ee-d6a7c05892ad","block_type":"box","text":"the periods indicated:","page_number":67,"box":{"x":116,"y":352,"width":148,"height":13}},{"id":"39c8f79a-537d-469b-aa49-0884a9a2143f","block_type":"box","text":"Fees Paid to JPM","page_number":67,"box":{"x":514,"y":376,"width":99,"height":10}},{"id":"753a6022-3bdc-4926-be88-ecc5bd4c4f09","block_type":"box","text":"For the Year Ended December 31,","page_number":67,"box":{"x":465,"y":386,"width":197,"height":10}},{"id":"f2c0e2fe-74a7-4269-9f9a-9cef0333e460","block_type":"box","text":"Fees Paid to the Manager","page_number":67,"box":{"x":709,"y":376,"width":147,"height":10}},{"id":"b7ae7b97-174f-40b3-8a0e-e31c28b1d712","block_type":"box","text":"For the Year Ended December 31,","page_number":67,"box":{"x":684,"y":386,"width":197,"height":10}},{"id":"92f6be21-66e0-4a5f-8592-b5dd72199cc9","block_type":"box","text":"2025","page_number":67,"box":{"x":476,"y":401,"width":28,"height":8}},{"id":"e10d7fb6-60e1-498c-9a5b-73f2da6eabe3","block_type":"box","text":"2024","page_number":67,"box":{"x":549,"y":401,"width":29,"height":8}},{"id":"471e36ad-c717-4931-82de-84ed70de837b","block_type":"box","text":"2023","page_number":67,"box":{"x":622,"y":401,"width":28,"height":8}},{"id":"d99078c4-5e3a-47e6-9f46-ead1c4a99ad2","block_type":"box","text":"2025","page_number":67,"box":{"x":695,"y":401,"width":28,"height":8}},{"id":"4605d9c2-f488-4a1b-829c-017f3fa8fa28","block_type":"box","text":"2024","page_number":67,"box":{"x":768,"y":401,"width":28,"height":8}},{"id":"87f10e4e-8cf3-4857-a265-3afba0a64354","block_type":"box","text":"2023","page_number":67,"box":{"x":841,"y":401,"width":28,"height":8}},{"id":"f74beaf7-15d2-4da7-985f-9582aef49174","block_type":"box","text":"BlackRock 60/40 Target Allocation ETF V.I. Fund $64,269 $58,903 $65,827 $0 $0 $0","page_number":67,"box":{"x":116,"y":419,"width":746,"height":10}},{"id":"ed43d6cc-f78d-4e7a-886f-87d4b31acc93","block_type":"box","text":"BlackRock Advantage Large Cap Core V.I. Fund $36,888 $43,382 $55,763 $0 $0 $0","page_number":67,"box":{"x":116,"y":434,"width":746,"height":10}},{"id":"e04fc727-6b41-48bd-9bd3-9e097fd057d6","block_type":"box","text":"BlackRock Advantage Large Cap Value V.I. Fund $32,562 $38,488 $52,173 $0 $0 $0","page_number":67,"box":{"x":116,"y":448,"width":746,"height":11}},{"id":"ffa33038-f770-4d93-9376-2ad0813df122","block_type":"box","text":"BlackRock Advantage SMID Cap V.I. Fund $35,164 $41,119 $54,535 $0 $0 $0","page_number":67,"box":{"x":116,"y":463,"width":746,"height":11}},{"id":"16719b2b-c94f-4b73-80f8-56345bfc9aec","block_type":"box","text":"BlackRock Basic Value V.I. Fund $42,487 $48,987 $62,265 $0 $0 $0","page_number":67,"box":{"x":116,"y":478,"width":746,"height":10}},{"id":"79035ae8-05b2-4203-9c3f-f6f81490e64c","block_type":"box","text":"BlackRock Capital Appreciation V.I. Fund $35,244 $40,499 $54,261 $0 $0 $0","page_number":67,"box":{"x":116,"y":493,"width":746,"height":10}},{"id":"91997316-641d-4415-aa97-134c3245cf4d","block_type":"box","text":"BlackRock Equity Dividend V.I. Fund $42,411 $48,613 $61,275 $0 $0 $0","page_number":67,"box":{"x":116,"y":507,"width":746,"height":11}},{"id":"7cec153f-6256-44cc-9e1e-89a0f6163b3d","block_type":"box","text":"BlackRock Global Allocation V.I. Fund $436,448 $428,658 $377,142 $0 $0 $0","page_number":67,"box":{"x":116,"y":522,"width":746,"height":10}},{"id":"c78e1229-bcfc-481d-b988-0dec51f750a8","block_type":"box","text":"BlackRock Government Money Market V.I. Fund $20,729 $24,939 $41,898 $0 $0 $0","page_number":67,"box":{"x":116,"y":537,"width":746,"height":10}},{"id":"db5a8cfc-5a39-4bde-85c5-75fa62695254","block_type":"box","text":"BlackRock International Index V.I. Fund $39,609 $43,630 $55,632 $0 $0 $0","page_number":67,"box":{"x":116,"y":551,"width":746,"height":11}},{"id":"085ab8c2-e0ff-49aa-8116-dca64f202c16","block_type":"box","text":"BlackRock International V.I. Fund $31,970 $36,165 $50,135 $0 $0 $0","page_number":67,"box":{"x":116,"y":566,"width":746,"height":10}},{"id":"0c4cc202-88b5-4e0e-bafa-41db897c173e","block_type":"box","text":"BlackRock Large Cap Focus Growth V.I. Fund $38,356 $49,857 $55,946 $0 $0 $0","page_number":67,"box":{"x":116,"y":581,"width":746,"height":10}},{"id":"cf0e2d14-181f-4d04-9fc1-1cb60e2ebcd0","block_type":"box","text":"BlackRock Managed Volatility V.I. Fund $135,692 $103,996 $213,152 $0 $0 $0","page_number":67,"box":{"x":116,"y":596,"width":746,"height":10}},{"id":"941934bf-b007-4fe8-8e6e-ba3232cb2897","block_type":"box","text":"BlackRock S&P 500 Index V.I. Fund $171,326 $169,188 $142,572 $0 $0 $0","page_number":67,"box":{"x":116,"y":610,"width":746,"height":10}},{"id":"1e87be74-b31f-446f-ab4e-8877e8a1f02f","block_type":"box","text":"BlackRock Small Cap Index V.I. Fund $44,377 $48,731 $59,860 $0 $0 $0","page_number":67,"box":{"x":116,"y":625,"width":746,"height":11}},{"id":"5ebd3261-e59c-49d6-b0cb-9a791b3ff627","block_type":"box","text":"Organization and Management of Wholly-Owned Subsidiary","page_number":67,"box":{"x":137,"y":649,"width":444,"height":12}},{"id":"c7a4ba6b-c1f8-4f55-a24e-f189c72445fa","block_type":"box","text":"BlackRock Global Allocation V.I. Fund intends to gain exposure to commodity markets by investing up to","page_number":67,"box":{"x":116,"y":672,"width":739,"height":13}},{"id":"80dd17e2-0d01-44f4-9710-be0fb828cde7","block_type":"box","text":"25% of its total assets in the Global Allocation Subsidiary. The Global Allocation Subsidiary invests primarily","page_number":67,"box":{"x":116,"y":687,"width":764,"height":13}},{"id":"b93a52d7-652b-434a-a96b-6ea77a2d70bf","block_type":"box","text":"in commodity-related instruments.","page_number":67,"box":{"x":116,"y":703,"width":239,"height":13}},{"id":"73f85740-1f31-4f2e-867d-ceaba7488635","block_type":"box","text":"The Subsidiary is a company organized under the laws of the Cayman Islands, whose registered office is","page_number":67,"box":{"x":116,"y":724,"width":720,"height":13}},{"id":"e5e982b2-df51-4ad4-a29f-0f5fbf1cbe30","block_type":"box","text":"located at the offices of Maples Corporate Services Limited, P.O. Box 309, Ugland House, Grand Cayman","page_number":67,"box":{"x":116,"y":740,"width":739,"height":12}},{"id":"4179eb44-65f9-4c21-a6a6-bc07bd164456","block_type":"box","text":"KYI-1104, Cayman Islands. The Subsidiary’s affairs are overseen by a board of directors, which is comprised","page_number":67,"box":{"x":116,"y":755,"width":757,"height":13}},{"id":"95027194-b7a3-4582-8c68-c359c8432244","block_type":"box","text":"of John M. Perlowski and Trent Walker, each a member of the Company’s Board of Directors.","page_number":67,"box":{"x":116,"y":771,"width":658,"height":12}},{"id":"f6ca878f-169f-4e64-9d0e-ded74bffb5b5","block_type":"box","text":"The Manager provides investment management and administrative services to the Subsidiary. The Manager","page_number":67,"box":{"x":116,"y":792,"width":746,"height":13}},{"id":"1ea11f06-4039-4b86-9392-68ce224aec23","block_type":"box","text":"does not receive separate compensation from the Subsidiary for providing it with investment advisory or","page_number":67,"box":{"x":116,"y":807,"width":723,"height":13}},{"id":"50827254-3505-4dfd-95d3-f5f1840e5304","block_type":"box","text":"administrative services. However, BlackRock Global Allocation V.I. Fund pays the Manager based on the","page_number":67,"box":{"x":116,"y":823,"width":733,"height":13}},{"id":"8d8db442-1f06-41f1-b18a-bd3ab765b4aa","block_type":"box","text":"Fund’s assets, including the assets invested in the Subsidiary. The Subsidiary entered into contracts for the","page_number":67,"box":{"x":116,"y":838,"width":732,"height":13}},{"id":"154c8fa0-3110-4770-a19f-5c70edf687ff","block_type":"box","text":"provision of advisory, custody, and audit services with the same service providers that provide those services","page_number":67,"box":{"x":116,"y":854,"width":750,"height":13}},{"id":"673f9c76-9192-46f1-b8f8-5e6406351cac","block_type":"box","text":"to BlackRock Global Allocation V.I. Fund.","page_number":67,"box":{"x":116,"y":869,"width":297,"height":11}},{"id":"322ccaad-d4f8-4bbb-9bb4-d0c168877cb6","block_type":"box","text":"I-49","page_number":67,"box":{"x":485,"y":917,"width":28,"height":9}},{"id":"1ce100ac-d505-45c0-85da-a4db62852ba5","block_type":"box","text":"NM1026U-6004382-67/605","page_number":67,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"640d13cc-fea6-4d2b-bda5-7997171c8a01","block_type":"box","text":"The Subsidiary is managed pursuant to compliance policies and procedures that are the same, in all material","page_number":68,"box":{"x":116,"y":79,"width":749,"height":13}},{"id":"9b2aaa2c-ebd4-4e0a-aaab-f951faba3d04","block_type":"box","text":"respects, as the policies and procedures adopted by the Company. As a result, the Manager, in managing the","page_number":68,"box":{"x":116,"y":94,"width":751,"height":13}},{"id":"377b3324-0876-4ad4-b4fd-9d5880eb21d8","block_type":"box","text":"Subsidiary’s portfolio, is subject to the same investment policies and restrictions that apply to the management","page_number":68,"box":{"x":116,"y":110,"width":765,"height":13}},{"id":"21db413f-0ffd-4995-8ab2-bb1f198bc9e9","block_type":"box","text":"of BlackRock Global Allocation V.I. Fund, and, in particular, to the requirements relating to portfolio","page_number":68,"box":{"x":116,"y":125,"width":708,"height":13}},{"id":"e446ae3c-7cdc-42b4-b079-d8aaadc5befd","block_type":"box","text":"leverage, liquidity, brokerage, and the timing and method of the valuation of a Subsidiary’s portfolio","page_number":68,"box":{"x":116,"y":141,"width":698,"height":13}},{"id":"64b9361a-ad39-4942-9966-8763b5485fa3","block_type":"box","text":"investments and shares of the Subsidiary. These policies and restrictions are described elsewhere in detail in","page_number":68,"box":{"x":116,"y":156,"width":742,"height":13}},{"id":"3fa4d7e4-f035-4c9e-90e9-01a8d07d6ce9","block_type":"box","text":"this SAI. BlackRock Global Allocation V.I. Fund an","page_number":68,"box":{"x":116,"y":172,"width":359,"height":10}},{"id":"5e96cf50-3356-4249-9846-80d2731cfb04","block_type":"box","text":"d the Subsidiary test for compliance with certain","page_number":68,"box":{"x":476,"y":172,"width":335,"height":13}},{"id":"aa0315ad-635d-4fbf-9390-e2842caac857","block_type":"box","text":"investment restrictions on a consolidated basis.","page_number":68,"box":{"x":116,"y":187,"width":325,"height":10}},{"id":"ff897665-8b27-47e5-8297-349ce4eef76e","block_type":"box","text":"V. Information on Distribution Related Expenses","page_number":68,"box":{"x":116,"y":216,"width":403,"height":13}},{"id":"0ffcb8dc-45d7-4937-9135-f56230b28db6","block_type":"box","text":"12b-1 Distribution Plans.","page_number":68,"box":{"x":117,"y":242,"width":175,"height":10}},{"id":"a8750251-86fd-4a0f-b914-cd449e0d2bb2","block_type":"box","text":"The Funds have adopted Distribution Plans (collectively, the “Plan”) with regard to","page_number":68,"box":{"x":298,"y":242,"width":580,"height":12}},{"id":"625c9d1c-8edb-4acc-8c7b-0868b063a720","block_type":"box","text":"the Class II and Class III shares of the Fund, pursuant to Rule 12b-1 under the Investment Company Act. The","page_number":68,"box":{"x":116,"y":257,"width":761,"height":13}},{"id":"a0774ece-bc8f-4280-adab-1eb531338b48","block_type":"box","text":"Plan permits the Company, on behalf of each Fund, to pay to each Insurance Company or a broker-dealer","page_number":68,"box":{"x":116,"y":273,"width":736,"height":12}},{"id":"dd0cccec-5157-4a4c-9f00-dff2b92090b5","block_type":"box","text":"affiliate thereof (“Insurance Company Affiliate”) that en","page_number":68,"box":{"x":116,"y":288,"width":392,"height":13}},{"id":"c0c3edb3-e968-45fb-8699-8dd42d140845","block_type":"box","text":"ters into an agreement with the Company to provide","page_number":68,"box":{"x":508,"y":288,"width":365,"height":13}},{"id":"4a858459-7537-425f-94f5-604e9adf3964","block_type":"box","text":"distribution-related and/or shareholder services to","page_number":68,"box":{"x":116,"y":304,"width":345,"height":10}},{"id":"2bbd7cbe-119b-44bc-993e-588b96546d44","block_type":"box","text":"Contract owners, a fee, at the end of each month, of up to","page_number":68,"box":{"x":466,"y":304,"width":403,"height":12}},{"id":"828bb936-1d71-4d5f-b4cc-4fdc8f72496e","block_type":"box","text":"0.15% of the average daily net asset value of the Class II Shares of the Fund held by such Insurance Company,","page_number":68,"box":{"x":117,"y":319,"width":765,"height":13}},{"id":"8ca2544e-d83a-44d1-8dcf-85659d729f9c","block_type":"box","text":"and up to 0.25% of the average daily net asset value of the Class III Shares of the Fund held by such Insurance","page_number":68,"box":{"x":116,"y":335,"width":766,"height":12}},{"id":"07b0b35b-ad51-4c0d-9293-7a4d0c69036e","block_type":"box","text":"Company. Such services include, but are not limited to, (a) the printing and mailing of Fund prospectuses,","page_number":68,"box":{"x":117,"y":350,"width":732,"height":13}},{"id":"1d93674d-bc45-4de7-9faa-3a89aceb30c4","block_type":"box","text":"statements of additional information, any supplements thereto and shareholder reports for existing and","page_number":68,"box":{"x":116,"y":366,"width":715,"height":12}},{"id":"1a70e134-b6c8-4a8f-8714-c93edd6aa59a","block_type":"box","text":"prospective Contract owners, (b) services relating to the development, preparation, printing and mailing of","page_number":68,"box":{"x":116,"y":381,"width":740,"height":13}},{"id":"69f35e98-32e7-4faf-b0ba-ff5f9d3a6a48","block_type":"box","text":"Company advertisements, sales literature and other promotional materials describing and/or relating to the","page_number":68,"box":{"x":117,"y":397,"width":740,"height":12}},{"id":"91d5cf24-c1e1-4279-829e-5a6cd129ca1a","block_type":"box","text":"Fund and including materials intended for use within th","page_number":68,"box":{"x":116,"y":412,"width":387,"height":13}},{"id":"4af852fb-b682-4a57-ab25-3d82ab821de3","block_type":"box","text":"e Insurance Company, or for broker-dealer only use or","page_number":68,"box":{"x":503,"y":412,"width":380,"height":13}},{"id":"07ca6bb6-867e-4cb3-9b13-64aeb84d4bb2","block_type":"box","text":"retail use, (c) holding seminars and sales meetings desi","page_number":68,"box":{"x":116,"y":428,"width":374,"height":12}},{"id":"334a359e-f6cf-4614-8f9a-5179630f81d0","block_type":"box","text":"gned to promote the distribution of the Class II and/or","page_number":68,"box":{"x":491,"y":428,"width":377,"height":12}},{"id":"5a5eb47d-1f76-4cf4-9e0c-f9a91fb904b8","block_type":"box","text":"Class III Shares of the Fund, (d) obtaining information and providing explanations to Contract owners","page_number":68,"box":{"x":117,"y":443,"width":711,"height":13}},{"id":"a360c2d1-398d-410d-98a5-9427e9c0fe3d","block_type":"box","text":"regarding the investment objectives and policies and other information about the Company and the Fund,","page_number":68,"box":{"x":116,"y":459,"width":733,"height":12}},{"id":"49511328-61dc-4ff9-aa9c-9354342a997f","block_type":"box","text":"including the performance of the Fund, (e) training sales personnel regarding the Company and the Fund,","page_number":68,"box":{"x":116,"y":474,"width":731,"height":13}},{"id":"fb79f3e6-e294-4f0d-bda7-4d2ba8a9487f","block_type":"box","text":"(f) compensating sales personnel in connection with th","page_number":68,"box":{"x":117,"y":490,"width":376,"height":12}},{"id":"3af2ad38-ef76-4e08-8ef7-c31804fcae8e","block_type":"box","text":"e allocation of cash values and premiums of the","page_number":68,"box":{"x":493,"y":490,"width":329,"height":12}},{"id":"cca64951-a9fa-4d4f-88f8-20aad79aa4ca","block_type":"box","text":"Contract owners to the Company, (g) providing personal services and/or maintenance of the accounts of the","page_number":68,"box":{"x":117,"y":505,"width":749,"height":13}},{"id":"2e48be10-eb29-4edc-8dd4-e54afe54b9ce","block_type":"box","text":"Contract owners with respect to Class II and Class III Shares of the Fund attributable to such accounts, and","page_number":68,"box":{"x":117,"y":521,"width":744,"height":12}},{"id":"affac15a-e647-4a47-b1ca-9b239da14ce8","block_type":"box","text":"(h) financing any other activity that the Company’s","page_number":68,"box":{"x":117,"y":536,"width":354,"height":13}},{"id":"a3c93377-1fa7-43f8-9140-d89e4c4f350e","block_type":"box","text":"Board of Directors determines is primarily intended to","page_number":68,"box":{"x":476,"y":536,"width":376,"height":13}},{"id":"94859731-2840-4d77-be0d-1cc8e896e530","block_type":"box","text":"result in the sale of Class II and Class III Shares. BlackRock Investments, LLC (“BRIL” or the “Distributor”),","page_number":68,"box":{"x":116,"y":552,"width":758,"height":12}},{"id":"2928357a-5f14-4c8d-abea-269a982ff53e","block_type":"box","text":"an affiliate of the Manager, acts as the Fund’s sole distributor. 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Such shares will be sold at their","page_number":69,"box":{"x":117,"y":238,"width":374,"height":13}},{"id":"2dcf4281-399b-47f9-955c-dacd99f0c6bf","block_type":"box","text":"respective net asset values and therefore will involve no","page_number":69,"box":{"x":496,"y":238,"width":382,"height":13}},{"id":"f28bbee0-e61b-4043-a758-2d94198ae6d7","block_type":"box","text":"sales charge. BRIL is an affiliate of the Manager.","page_number":69,"box":{"x":116,"y":254,"width":336,"height":13}},{"id":"fc3c7f30-1f35-4a60-8b78-1379e1cba6b2","block_type":"box","text":"The Distribution Agreement is subject to the same renew","page_number":69,"box":{"x":116,"y":278,"width":394,"height":13}},{"id":"df1535e6-813a-473d-b0d6-e783953d46bb","block_type":"box","text":"al requirements and termination provisions as the","page_number":69,"box":{"x":511,"y":278,"width":343,"height":13}},{"id":"48d79a00-45da-4cfa-9e79-8e1c918ab2d3","block_type":"box","text":"Management Agreement described above.","page_number":69,"box":{"x":116,"y":293,"width":290,"height":13}},{"id":"9ccf87ee-e4a1-48ff-91a4-c0eb1190ac6c","block_type":"box","text":"The Manager, the Distributor and their affiliates may make payments relating to distribution and sales","page_number":69,"box":{"x":116,"y":317,"width":712,"height":13}},{"id":"e5762565-6521-4e25-9f03-9a6ca6d3ad2e","block_type":"box","text":"support activities out of their past profits or other sources available to them (and not as an additional charge","page_number":69,"box":{"x":116,"y":333,"width":753,"height":12}},{"id":"a1f24d05-3e92-4fc5-be02-a35fdd6fa69f","block_type":"box","text":"to the Fund). From time to time, the Manager, the Distr","page_number":69,"box":{"x":116,"y":348,"width":388,"height":13}},{"id":"f805f6d6-5fa6-498a-a47f-cc518dc0461c","block_type":"box","text":"ibutor or their affiliates may compensate affiliated and","page_number":69,"box":{"x":504,"y":348,"width":378,"height":13}},{"id":"ecc75f2e-8521-4f27-8186-6eaeb57cdaf9","block_type":"box","text":"unaffiliated insurance companies or their broker-dealer affiliates for the sale and distribution of shares of the","page_number":69,"box":{"x":116,"y":364,"width":752,"height":12}},{"id":"b5621383-52d2-401d-81d7-9abecb2e348f","block_type":"box","text":"Fund or for services to the Fund and its contract holders. These payments would be in addition to the Fund","page_number":69,"box":{"x":116,"y":379,"width":744,"height":13}},{"id":"29b41ec6-95ae-4513-997d-5fcd2f79818e","block_type":"box","text":"payments described in this SAI for distribution. These","page_number":69,"box":{"x":116,"y":395,"width":372,"height":12}},{"id":"23918058-6451-4ae6-9002-40d8265fd29f","block_type":"box","text":"payments may be made to insurance companies or their","page_number":69,"box":{"x":493,"y":395,"width":386,"height":12}},{"id":"5f501d30-e629-453d-bfff-399c1e00f8e4","block_type":"box","text":"broker-dealer affiliates to pay for marketing support activities, training sales personnel regarding the Fund,","page_number":69,"box":{"x":116,"y":410,"width":740,"height":13}},{"id":"02e9ab52-758f-4ab2-8ef3-e1f524f700e0","block_type":"box","text":"compensating financial intermediaries and broker-","page_number":69,"box":{"x":116,"y":426,"width":349,"height":12}},{"id":"dbd680cc-0d05-4f9b-a976-455c2c7df867","block_type":"box","text":"dealers to pay or reimburse them for their services or","page_number":69,"box":{"x":466,"y":426,"width":366,"height":12}},{"id":"ec2998e5-3365-45a3-94e9-81303e37c128","block_type":"box","text":"expenses in connection with the distribution of variabl","page_number":69,"box":{"x":116,"y":441,"width":377,"height":13}},{"id":"ff992248-db46-498f-a3de-93d90a71cb22","block_type":"box","text":"e annuity and variable life insurance contracts investing","page_number":69,"box":{"x":494,"y":441,"width":384,"height":13}},{"id":"589d5a0e-163b-45a1-b544-b95c133caf70","block_type":"box","text":"in Fund shares, and compensating sales personnel in connection with the allocation of cash values and","page_number":69,"box":{"x":116,"y":457,"width":708,"height":12}},{"id":"394050e9-45ee-4bf2-bfec-7c80e83577d3","block_type":"box","text":"premium of variable annuity and variable life insurance contracts to investments in Fund shares. The","page_number":69,"box":{"x":116,"y":472,"width":698,"height":13}},{"id":"e3b25cfe-e1fa-44b3-b553-381c84ecd0fa","block_type":"box","text":"payments made by the Manager, the Distributor and their affiliates are based on a percentage of the value of","page_number":69,"box":{"x":116,"y":488,"width":754,"height":12}},{"id":"ee88f404-41db-4f7d-aca8-19e9a19a4a49","block_type":"box","text":"shares sold to, or held by, customers of the insurance company involved, and may be different for different","page_number":69,"box":{"x":116,"y":503,"width":740,"height":13}},{"id":"607b3723-ef4b-4abe-99fd-fdd84ed69f6e","block_type":"box","text":"insurance companies. The payments described above are made from the Manager’s, the Distributor’s or their","page_number":69,"box":{"x":116,"y":519,"width":755,"height":13}},{"id":"00f4cab3-fcc9-4d4f-bafd-94e608a3cafb","block_type":"box","text":"affiliates’ own assets pursuant to agreements with insuranc","page_number":69,"box":{"x":116,"y":534,"width":408,"height":13}},{"id":"514a0ec0-0674-46e0-9da7-617ff7e594c7","block_type":"box","text":"e companies or their broker-dealer affiliates and do","page_number":69,"box":{"x":525,"y":534,"width":354,"height":13}},{"id":"be3a1c7e-fd0f-474d-b9f7-74f4e19c562b","block_type":"box","text":"not change the price paid by investors for the purchase of the Fund’s shares or the amount the Fund will","page_number":69,"box":{"x":116,"y":550,"width":722,"height":13}},{"id":"7894c250-33e6-4ccf-b549-aa023f3a5302","block_type":"box","text":"receive as proceeds from such sales.","page_number":69,"box":{"x":116,"y":565,"width":245,"height":13}},{"id":"73383d93-8f4c-4dd1-85b7-2c175084adca","block_type":"box","text":"The payments described above may be made, at the discretion of BRIL or BlackRock, to insurance companies","page_number":69,"box":{"x":116,"y":589,"width":761,"height":13}},{"id":"f4aaaf3d-71fc-43e9-93f1-32af4251f4b6","block_type":"box","text":"or their broker-dealer affiliates in connection with the sale and distribution of Fund shares. Pursuant to","page_number":69,"box":{"x":116,"y":605,"width":714,"height":10}},{"id":"3d5bef0a-2777-4057-b8ee-c85792a59778","block_type":"box","text":"applicable Financial Industry Regulatory Authority (“FINRA”) regulations, the details of certain of these","page_number":69,"box":{"x":116,"y":620,"width":728,"height":13}},{"id":"d8910869-0404-418f-a491-575240d5e2f1","block_type":"box","text":"payments, including the insurance companies or the","page_number":69,"box":{"x":116,"y":636,"width":359,"height":12}},{"id":"aaa64ae5-9548-4371-a0a6-8fa80f4cde33","block_type":"box","text":"ir broker-dealer affiliates receiving such payments in","page_number":69,"box":{"x":476,"y":636,"width":362,"height":12}},{"id":"d023bcbf-31ee-4a4a-b463-b61ebc09ec0e","block_type":"box","text":"connection with the sale and distribution of Fund shares, are required to be disclosed.","page_number":69,"box":{"x":116,"y":651,"width":593,"height":13}},{"id":"5ea71bbc-bbff-48a9-bd3e-144de5083138","block_type":"box","text":"As of the date of this SAI, as amended or supplemented fro","page_number":69,"box":{"x":116,"y":675,"width":409,"height":13}},{"id":"6262095d-e29f-4416-aabd-c803d8bc96ab","block_type":"box","text":"m time to time, the following insurance companies","page_number":69,"box":{"x":525,"y":675,"width":351,"height":13}},{"id":"bb7850d6-a475-4f77-9469-2f5d4838818a","block_type":"box","text":"(or broker-dealer affiliates thereof) are receiving such p","page_number":69,"box":{"x":117,"y":690,"width":380,"height":13}},{"id":"2c589537-ba9c-491c-9903-06b13dbb0a78","block_type":"box","text":"ayments: Allianz Life Financial Services LLC, Equitable","page_number":69,"box":{"x":498,"y":690,"width":383,"height":13}},{"id":"6eeea503-832d-4ab4-a83a-f697ceb25742","block_type":"box","text":"Financial Life Insurance Company, Massachusetts Mu","page_number":69,"box":{"x":116,"y":706,"width":378,"height":13}},{"id":"3732305e-7398-4e77-b3cc-73ad86ec416b","block_type":"box","text":"tual Life Insurance Company, Nationwide Financial","page_number":69,"box":{"x":494,"y":706,"width":361,"height":13}},{"id":"ad910ccf-3f28-4d94-876a-211d8eb35cda","block_type":"box","text":"Services, Inc., Nationwide Fund Distributors, LLC, New York Life Insurance and Annuity Corporation,","page_number":69,"box":{"x":116,"y":721,"width":722,"height":13}},{"id":"cbb9425f-e258-41e7-b777-ef1d89e4e731","block_type":"box","text":"Pacific Select Distributors, Inc., Prudential Annuities Distributors, Inc., RiverSource Distributors, Inc.,","page_number":69,"box":{"x":116,"y":737,"width":705,"height":12}},{"id":"51afe4cb-ad40-4084-8eda-b7e9c9b42075","block_type":"box","text":"Transamerica Life Insurance Company and Transamerica Financial Life Insurance Company. In lieu of","page_number":69,"box":{"x":116,"y":752,"width":715,"height":13}},{"id":"5ebffaa0-c882-4dd8-a61e-17cddff572f2","block_type":"box","text":"payments pursuant to the foregoing, the Manager, the","page_number":69,"box":{"x":116,"y":768,"width":375,"height":13}},{"id":"15e78d4b-5cb5-4446-96b3-fcbd5095ac69","block_type":"box","text":"Distributor or their affiliates may make payments to","page_number":69,"box":{"x":496,"y":768,"width":362,"height":13}},{"id":"7a34920f-924d-45f3-b870-c501f3727a62","block_type":"box","text":"insurance companies or their broker-dealer affiliates of an agreed-upon amount that will not exceed the","page_number":69,"box":{"x":116,"y":783,"width":718,"height":13}},{"id":"8ae6fef7-b876-4176-b823-969dc4d5e82d","block_type":"box","text":"amount that would have been payable pursuant to the above, and may also make similar payments to other","page_number":69,"box":{"x":116,"y":799,"width":748,"height":13}},{"id":"df724878-7bcb-4b41-9f4f-ea4cd5e805c2","block_type":"box","text":"insurance companies or their broker-dealer affiliates.","page_number":69,"box":{"x":116,"y":814,"width":365,"height":13}},{"id":"31ca5bf9-3c1f-401f-8a0b-b8fa8da64e63","block_type":"box","text":"If investment advisers, distributors or affiliates of mutual funds pay bonuses and incentives in differing","page_number":69,"box":{"x":116,"y":838,"width":710,"height":13}},{"id":"9f14aa9b-a269-4cd8-8c49-ff29ba6ecbe7","block_type":"box","text":"amounts, financial firms and their financial consultants may have financial incentives for recommending a","page_number":69,"box":{"x":116,"y":854,"width":735,"height":13}},{"id":"9e95ed1c-2682-4a78-8ad3-9b0a5518a39f","block_type":"box","text":"particular mutual fund over other mutual funds. In addition, depending on the arrangements in place at any","page_number":69,"box":{"x":116,"y":869,"width":749,"height":13}},{"id":"a846ffc0-1c7f-461a-9193-73d12a9e66e8","block_type":"box","text":"I-51","page_number":69,"box":{"x":485,"y":917,"width":28,"height":9}},{"id":"b59ee7dd-cd58-4249-a028-0fec701e4e44","block_type":"box","text":"NM1026U-6004382-69/605","page_number":69,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"57105f98-e636-48f8-b0b5-84e21682121d","block_type":"box","text":"particular time, a financial firm and its financial c","page_number":70,"box":{"x":116,"y":79,"width":344,"height":13}},{"id":"e2550c24-95b5-427d-b726-096813fba7d6","block_type":"box","text":"onsultants may also have a financial incentive for","page_number":70,"box":{"x":460,"y":79,"width":342,"height":13}},{"id":"ae103afc-f79b-482d-8436-78293823a184","block_type":"box","text":"recommending a particular share class over other share classes. Furthermore, the Manager, the Distributor","page_number":70,"box":{"x":116,"y":94,"width":739,"height":13}},{"id":"e4b9c527-1a61-4886-a643-ec55c7c35791","block_type":"box","text":"and their affiliates may contribute to various non-cash and cash incentive arrangements to promote the sale of","page_number":70,"box":{"x":116,"y":110,"width":765,"height":13}},{"id":"ccee73e0-4935-4be4-849b-188f4a681fde","block_type":"box","text":"shares, and may sponsor various contests and promoti","page_number":70,"box":{"x":116,"y":125,"width":377,"height":13}},{"id":"83805f5a-642d-41d2-921e-b6ac6dbc60fb","block_type":"box","text":"ons subject to applicable FINRA regulations in which","page_number":70,"box":{"x":494,"y":125,"width":371,"height":13}},{"id":"c6b4f529-3112-4550-bf56-62d1c27815a5","block_type":"box","text":"participants may receive prizes such as travel awards, merchandise and cash. Subject to applicable FINRA","page_number":70,"box":{"x":116,"y":141,"width":735,"height":13}},{"id":"d84596df-7ab2-4d68-b825-429bf8f2d628","block_type":"box","text":"regulations, the Manager, the Distributor and their affiliates may also (i) pay for the travel expenses, meals,","page_number":70,"box":{"x":116,"y":156,"width":743,"height":13}},{"id":"e8849e72-943a-4a3b-9510-12f9b7bcdf8e","block_type":"box","text":"lodging and entertainment of broker/dealers, financi","page_number":70,"box":{"x":116,"y":172,"width":361,"height":13}},{"id":"b2c5a70b-fd56-46b3-8385-7bf32ca64090","block_type":"box","text":"al institutions and their salespersons in connection with","page_number":70,"box":{"x":478,"y":172,"width":384,"height":13}},{"id":"20a3518c-f1e8-4666-9fb6-d145be3cd7f2","block_type":"box","text":"educational and sales promotional programs, (ii) sponsor speakers, educational seminars and charitable events","page_number":70,"box":{"x":116,"y":187,"width":765,"height":13}},{"id":"c7a77ad6-1177-4cd4-a63f-a9380b462e28","block_type":"box","text":"and (iii) provide other sales and marketing conferences and other resources to broker/dealers, financial","page_number":70,"box":{"x":116,"y":203,"width":710,"height":13}},{"id":"4edb8530-a218-4b3b-920e-4218078940be","block_type":"box","text":"institutions and their salespersons.","page_number":70,"box":{"x":116,"y":218,"width":237,"height":13}},{"id":"87d08103-70e9-40f3-b1f9-cf220ce97f4a","block_type":"box","text":"Insurance companies may charge their clients additional fees for account-related services. Insurance companies","page_number":70,"box":{"x":116,"y":240,"width":766,"height":13}},{"id":"90c544c0-b353-40f5-a97d-6a02b9d1db0a","block_type":"box","text":"may charge their customers a service fee in connectio","page_number":70,"box":{"x":116,"y":256,"width":367,"height":12}},{"id":"3ff0e436-bd88-48dd-a9d1-ba2543cd6163","block_type":"box","text":"n with the purchase or redemption of Fund shares. The","page_number":70,"box":{"x":483,"y":256,"width":383,"height":12}},{"id":"95524c0d-6edc-4396-9813-d88e396bec0a","block_type":"box","text":"amount and applicability of such a fee is determined an","page_number":70,"box":{"x":116,"y":271,"width":384,"height":13}},{"id":"cc047390-d214-4c3f-a20e-838c76e184d9","block_type":"box","text":"d disclosed to its customers by each individual","page_number":70,"box":{"x":501,"y":271,"width":319,"height":13}},{"id":"c7072ba7-1e23-4bc5-b8dd-2390ac2c0f21","block_type":"box","text":"insurance company. 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Such","page_number":70,"box":{"x":116,"y":355,"width":372,"height":13}},{"id":"1d786a17-5ccd-44de-97cb-c13efa321001","block_type":"box","text":"services will be provided to Customers and are intended","page_number":70,"box":{"x":493,"y":355,"width":388,"height":13}},{"id":"6d9ac521-d9fc-42a4-87d4-109aeb9b0542","block_type":"box","text":"to supplement the services provided by the Fund’s Manager, administrator and/or Transfer Agent to the","page_number":70,"box":{"x":116,"y":370,"width":720,"height":13}},{"id":"902fcb53-76a8-4cdc-b1d0-69f79feb314c","block_type":"box","text":"insurance company. In consideration for payment of a service fee on shares, insurance companies or their","page_number":70,"box":{"x":116,"y":386,"width":730,"height":13}},{"id":"0b2c4a44-45dc-437d-9a32-8877aa335fa0","block_type":"box","text":"broker-dealer affiliates may provide general shareholder liaison services, including, but not limited to","page_number":70,"box":{"x":116,"y":401,"width":699,"height":13}},{"id":"5adc8fbd-2865-4cd8-9a8b-d60ec32760c0","block_type":"box","text":"(i) answering customer inquiries regarding account","page_number":70,"box":{"x":117,"y":417,"width":351,"height":13}},{"id":"5595aaba-272f-4a41-8665-09f64bb95ee9","block_type":"box","text":"status and history, the manner in which purchases,","page_number":70,"box":{"x":473,"y":417,"width":351,"height":13}},{"id":"2ae5064a-9071-4e69-ad60-37e42731c241","block_type":"box","text":"exchanges and redemptions of shares may be effected an","page_number":70,"box":{"x":116,"y":432,"width":391,"height":13}},{"id":"a2ef9e16-7d60-4dc5-8809-3b4fce54360b","block_type":"box","text":"d certain other matters pertaining to the Customers’","page_number":70,"box":{"x":508,"y":432,"width":360,"height":13}},{"id":"611c5b45-bb76-4c42-a4be-1197f7ea7ef4","block_type":"box","text":"sub-accounts; and (ii) assisting Customers in design","page_number":70,"box":{"x":116,"y":448,"width":356,"height":13}},{"id":"b0047660-25fe-497e-8f35-cedc698d5c30","block_type":"box","text":"ating and changing account designations and addresses.","page_number":70,"box":{"x":473,"y":448,"width":384,"height":13}},{"id":"4b279629-c97b-48bb-82bd-8e35bdce17a3","block_type":"box","text":"In addition to, rather than in lieu of, distribution fees that the Fund may pay to an insurance company or its","page_number":70,"box":{"x":116,"y":469,"width":748,"height":13}},{"id":"6bc6fc77-e173-42e9-a1c8-0a76b4186bc1","block_type":"box","text":"broker-dealer affiliate pursuant to the Plan and fees the Fund pays to its Transfer Agent, if approved by the","page_number":70,"box":{"x":116,"y":485,"width":742,"height":13}},{"id":"6c53d82f-8672-43a4-9f27-e798bfbdcac5","block_type":"box","text":"Board, the Fund may enter into non-Plan agreements with insurance companies or their broker-dealer","page_number":70,"box":{"x":116,"y":500,"width":706,"height":13}},{"id":"629b0c0f-a2a0-4cbe-af71-f6a0de534dcd","block_type":"box","text":"affiliates pursuant to which the Fund will pay an insurance company or its broker-dealer affiliates for","page_number":70,"box":{"x":116,"y":516,"width":702,"height":13}},{"id":"78fe3e8b-76ba-41e4-a061-fb357dfb4285","block_type":"box","text":"administrative, networking, recordkeeping, sub-transfer agency and shareholder services. These non-Plan","page_number":70,"box":{"x":116,"y":531,"width":728,"height":13}},{"id":"202b9260-dddf-4347-8ba4-e875abb97709","block_type":"box","text":"payments are based on a percentage of the average daily net assets of Fund shares held indirectly by","page_number":70,"box":{"x":116,"y":547,"width":690,"height":13}},{"id":"ce6e6f9c-4d93-404c-b116-e9303753a118","block_type":"box","text":"Customers of such insurance companies.","page_number":70,"box":{"x":117,"y":562,"width":280,"height":13}},{"id":"aa8856e8-a225-4494-bc0a-e3d3370f2334","block_type":"box","text":"The aggregate amount of these payments may be substantial. From time to time, the Manager, the Distributor","page_number":70,"box":{"x":116,"y":584,"width":764,"height":13}},{"id":"9130dfe9-a2c1-486c-a989-78cc6135831d","block_type":"box","text":"or their affiliates also may pay a portion of the fees fo","page_number":70,"box":{"x":116,"y":600,"width":372,"height":13}},{"id":"6b532fcd-3116-4727-b144-fcb16b7f8f58","block_type":"box","text":"r administrative, networking, recordkeeping,","page_number":70,"box":{"x":489,"y":600,"width":309,"height":13}},{"id":"6c4a44c8-f4cb-47ec-8a40-9db0f13ef3f2","block_type":"box","text":"sub-transfer agency and shareholder services described above at its or their own expense and out of its or their","page_number":70,"box":{"x":116,"y":615,"width":765,"height":13}},{"id":"78acde43-068a-4fb4-bd48-60ff68101796","block_type":"box","text":"legitimate profits.","page_number":70,"box":{"x":116,"y":631,"width":121,"height":13}},{"id":"934cf14e-d826-4984-964e-2a3586b87d06","block_type":"box","text":"VI. Computation of Offering Price Per Share","page_number":70,"box":{"x":116,"y":657,"width":364,"height":12}},{"id":"6a5aa6fc-7eeb-4db8-9a42-6e0aca10380d","block_type":"box","text":"The offering price for each Fund’s shares is equal to the","page_number":70,"box":{"x":116,"y":680,"width":384,"height":13}},{"id":"bd763dc4-69b7-48ad-bfe1-1acdb9d0e794","block_type":"box","text":"net asset value computed by dividing the value of the","page_number":70,"box":{"x":505,"y":680,"width":367,"height":13}},{"id":"8cc04dad-2861-47bc-b07b-6c9b1379a232","block_type":"box","text":"Fund’s net assets by the number of shares outstanding. For more information on the purchasing and valuation","page_number":70,"box":{"x":116,"y":696,"width":764,"height":13}},{"id":"177ad6e4-8480-4f27-9f2c-c3dd126d3488","block_type":"box","text":"of shares, please see “Purchase of Shares” and “Pricing of Shares” in Part II of this SAI. The Subsidiary is","page_number":70,"box":{"x":116,"y":711,"width":728,"height":13}},{"id":"d267ad02-e3ae-4a66-853d-992c8054c990","block_type":"box","text":"subject to the same valuation policies as BlackRock","page_number":70,"box":{"x":116,"y":727,"width":356,"height":13}},{"id":"e3d2d614-23d6-4e99-a433-83075593d19e","block_type":"box","text":"Global Allocation V.I. Fund as described in “Pricing of","page_number":70,"box":{"x":478,"y":727,"width":381,"height":13}},{"id":"8e58f9fd-eac3-4350-bdc6-8219962b688a","block_type":"box","text":"Shares” in Part II of this SAI. BlackRock Global Allocation V.I. Fund’s investment in the Subsidiary is valued","page_number":70,"box":{"x":116,"y":742,"width":756,"height":13}},{"id":"94c73a1b-f7d3-4000-8ab9-8df6ff71b065","block_type":"box","text":"based on the value of the Subsidiary’s portfolio investments. The Subsidiary prices its portfolio investments","page_number":70,"box":{"x":116,"y":758,"width":741,"height":13}},{"id":"7643a124-c9e9-484d-bb36-c2bf66398cc4","block_type":"box","text":"pursuant to the same pricing and valuation methodologies and procedures used by BlackRock Global","page_number":70,"box":{"x":116,"y":773,"width":704,"height":13}},{"id":"0d872c88-8a71-4a2e-8773-a75fa131122e","block_type":"box","text":"Allocation V.I. Fund, which require, among other things, that the Subsidiary’s portfolio investments be","page_number":70,"box":{"x":116,"y":789,"width":713,"height":13}},{"id":"77374928-f8a1-42a8-bbd7-bac778dbc2fa","block_type":"box","text":"marked-to-market (that is, the value on the Subsidiary’s books changes) each business day to reflect changes in","page_number":70,"box":{"x":116,"y":804,"width":767,"height":13}},{"id":"494c9148-075c-4f0c-8b0c-ed6bb0b0019a","block_type":"box","text":"the market value of the investment.","page_number":70,"box":{"x":116,"y":820,"width":244,"height":10}},{"id":"6ca57633-72bf-4ad2-9c1a-fafa7d6fe124","block_type":"box","text":"VII. Portfolio Transactions and Brokerage","page_number":70,"box":{"x":116,"y":846,"width":342,"height":13}},{"id":"e23e4643-4aea-4c99-b9b7-134ecccf1ed7","block_type":"box","text":"See “Portfolio Transactions and Brokerage” in Part II of this SAI for more information.","page_number":70,"box":{"x":116,"y":869,"width":605,"height":13}},{"id":"c5c4ed04-c529-4e0f-9f2f-f76b1be92153","block_type":"box","text":"I-52","page_number":70,"box":{"x":485,"y":917,"width":29,"height":9}},{"id":"fa946b02-52eb-4ca6-a01d-67a25d5084df","block_type":"box","text":"NM1026U-6004382-70/605","page_number":70,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"ce504a6f-ef10-4605-b9d5-63301b7931f7","block_type":"box","text":"Brokerage Commissions.","page_number":71,"box":{"x":116,"y":79,"width":173,"height":13}},{"id":"9901338c-15c5-45d6-9ebd-fd9adfd2698e","block_type":"box","text":"Information about the brokerage commissions paid by each Fund, including","page_number":71,"box":{"x":295,"y":79,"width":527,"height":13}},{"id":"870d67a8-6dfd-40d7-b79d-f6a1e18c5150","block_type":"box","text":"commissions paid to affiliates of the Manager, for the last","page_number":71,"box":{"x":116,"y":94,"width":401,"height":13}},{"id":"62d8edee-cfdf-4032-bee3-671955397b2b","block_type":"box","text":"three fiscal years is set forth in the following table:","page_number":71,"box":{"x":521,"y":94,"width":348,"height":13}},{"id":"0a68ada5-99a7-4d63-8532-9daac6ba83c1","block_type":"box","text":"Aggregate Brokerage Commissions Paid","page_number":71,"box":{"x":381,"y":118,"width":232,"height":10}},{"id":"2b67181d-bd10-4c6b-bb6f-aec41c2020df","block_type":"box","text":"For the Year Ended December 31,","page_number":71,"box":{"x":398,"y":128,"width":197,"height":10}},{"id":"49796225-d36b-4076-844a-9be0c64d47da","block_type":"box","text":"Commissions Paid to Affiliates","page_number":71,"box":{"x":671,"y":118,"width":177,"height":8}},{"id":"291471ad-ba4b-4e57-b505-842b77f273f7","block_type":"box","text":"For the Year Ended December 31,","page_number":71,"box":{"x":661,"y":128,"width":197,"height":10}},{"id":"e3785ce6-4870-4c7c-92de-0d87fe542c29","block_type":"box","text":"2025","page_number":71,"box":{"x":391,"y":143,"width":29,"height":8}},{"id":"efd9891b-01c0-45bf-aab7-8ce94d497b93","block_type":"box","text":"2024","page_number":71,"box":{"x":482,"y":143,"width":29,"height":8}},{"id":"ddbb771b-4944-4f5d-b308-2293092120d8","block_type":"box","text":"2023","page_number":71,"box":{"x":573,"y":143,"width":29,"height":8}},{"id":"53cdb5a0-8a90-4d06-9ece-5df9658267aa","block_type":"box","text":"2025","page_number":71,"box":{"x":661,"y":143,"width":28,"height":8}},{"id":"cecb7a7c-4b48-4589-a4ae-1d1929cc4921","block_type":"box","text":"2024","page_number":71,"box":{"x":745,"y":143,"width":29,"height":8}},{"id":"1d104012-94c7-4f9d-8eca-9a1df41d736d","block_type":"box","text":"2023","page_number":71,"box":{"x":829,"y":143,"width":29,"height":8}},{"id":"45bcc26b-2fcf-4d28-a2c3-836601a20e1c","block_type":"box","text":"BlackRock 60/40 Target Allocation ETF\r\nVIFd","page_number":71,"box":{"x":116,"y":161,"width":234,"height":10}},{"id":"b4518d46-479a-4519-9775-a95f8bd4164c","block_type":"box","text":"V.I. 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Fund","page_number":71,"box":{"x":116,"y":216,"width":55,"height":8}},{"id":"fbda3545-041f-4c71-8195-3149a006e089","block_type":"box","text":"$19,697 $30,102 $36,432 $0 $0 $0","page_number":71,"box":{"x":383,"y":216,"width":468,"height":10}},{"id":"93a4351f-8cda-4bb6-a1c3-7cda35acaf53","block_type":"box","text":"BlackRock Advantage SMID Cap V.I.\r\nFd","page_number":71,"box":{"x":116,"y":231,"width":219,"height":10}},{"id":"3f6440d3-d54f-4fde-ac81-96e3b8cbc6e4","block_type":"box","text":"Fund","page_number":71,"box":{"x":116,"y":240,"width":29,"height":8}},{"id":"292ca65f-e387-4e09-adf9-c72c6c4060ce","block_type":"box","text":"$86,525 $92,928 $111,562 $0 $0 $0","page_number":71,"box":{"x":383,"y":239,"width":468,"height":11}},{"id":"5501853e-a027-4224-9e3b-5877f37d789f","block_type":"box","text":"BlackRock Basic Value V.I. Fund","page_number":71,"box":{"x":116,"y":254,"width":192,"height":8}},{"id":"896249a9-a5cb-46dd-8264-41d1e6207916","block_type":"box","text":"1","page_number":71,"box":{"x":309,"y":255,"width":3,"height":4}},{"id":"ea391bec-f794-4104-822b-4402377e8390","block_type":"box","text":"$181,274 $115,374 $152,051 $0 $0 $0","page_number":71,"box":{"x":379,"y":254,"width":472,"height":10}},{"id":"95302697-ec45-4ea1-8cc3-42c687c40c16","block_type":"box","text":"BlackRock Capital Appreciation V.I.\r\nFd2","page_number":71,"box":{"x":116,"y":268,"width":212,"height":10}},{"id":"3ef08b84-a66f-4913-9da9-26fc1c839417","block_type":"box","text":"Fund","page_number":71,"box":{"x":116,"y":277,"width":29,"height":8}},{"id":"41a9a3bd-85aa-4665-b097-b6f331d37fc5","block_type":"box","text":"2","page_number":71,"box":{"x":146,"y":278,"width":4,"height":5}},{"id":"6aa1243d-66d5-4959-81fa-2cda551ae126","block_type":"box","text":"$16,284 $52,384 $19,673 $0 $0 $0","page_number":71,"box":{"x":383,"y":277,"width":468,"height":10}},{"id":"517390f6-19dc-45aa-a635-d8759db8bd33","block_type":"box","text":"BlackRock Equity Dividend V.I. Fund $102,903 $109,637 $112,306 $0 $0 $0","page_number":71,"box":{"x":116,"y":291,"width":735,"height":11}},{"id":"4db9fb8b-651c-41c4-8892-a51bc83c3c64","block_type":"box","text":"BlackRock Global Allocation V.I. Fund $3,410,260 $4,404,792 $4,040,521 $0 $0 $0","page_number":71,"box":{"x":116,"y":305,"width":735,"height":11}},{"id":"604287b7-7ef3-4b7d-982b-30416294febb","block_type":"box","text":"BlackRock Government Money Market\r\nVIFd","page_number":71,"box":{"x":116,"y":320,"width":230,"height":10}},{"id":"ddd7b19f-89ad-4b95-953f-54dd6b63a3a4","block_type":"box","text":"V.I. Fund","page_number":71,"box":{"x":116,"y":329,"width":55,"height":8}},{"id":"643d7019-fc88-49a4-a77e-ec13348d57c3","block_type":"box","text":"$0 $0 $0 $0 $0 $0","page_number":71,"box":{"x":399,"y":329,"width":452,"height":9}},{"id":"07d92025-510b-4e41-b70b-c5ba3d9417ae","block_type":"box","text":"BlackRock International Index V.I. 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The imposition of any such","page_number":75,"box":{"x":116,"y":187,"width":687,"height":13}},{"id":"51606827-0c6d-44fd-bd03-b31394741470","block_type":"box","text":"discretionary or mandatory liquidity fee would reduce the Fund’s returns on securities lending.","page_number":75,"box":{"x":116,"y":203,"width":639,"height":13}},{"id":"d36d3609-e1f2-4f4a-9771-bd41c633a417","block_type":"box","text":"Under the securities lending program, each Fund is categorized into one of several specific asset classes. The","page_number":75,"box":{"x":116,"y":226,"width":745,"height":13}},{"id":"dc37cbf7-29b3-4fa9-a297-5d129ebfd59a","block_type":"box","text":"determination of a Fund’s asset class category (fixed-in","page_number":75,"box":{"x":116,"y":241,"width":380,"height":13}},{"id":"ea71b5d4-9a0e-4aa4-b0e4-8f950210ca3b","block_type":"box","text":"come, domestic equity, international equity, or fund of","page_number":75,"box":{"x":496,"y":241,"width":380,"height":13}},{"id":"03169b90-f116-425f-9deb-82fc547f8b06","block_type":"box","text":"funds), each of which may be subject to a different fee arrangement, is based on a methodology agreed to by","page_number":75,"box":{"x":116,"y":257,"width":752,"height":13}},{"id":"5a307cc4-544a-459b-ba56-422944efd827","block_type":"box","text":"the Company and BIM.","page_number":75,"box":{"x":116,"y":272,"width":164,"height":13}},{"id":"fa7b0af4-665d-4b6b-8936-9726392f2a66","block_type":"box","text":"Pursuant to the current securities lending agreement: (i) if BlackRock Government Money Market V.I. Fund","page_number":75,"box":{"x":116,"y":295,"width":750,"height":13}},{"id":"78e11baf-2e7b-4bca-8a9b-1d770e6ab370","block_type":"box","text":"were to engage in securities lending, it would retain 82% of securities lending income (which excludes","page_number":75,"box":{"x":116,"y":310,"width":706,"height":13}},{"id":"ec0f95b9-f264-4c1c-b285-2990382c24b7","block_type":"box","text":"collateral investment fees); and (ii) this amount can never be less than 70% of the sum of securities lending","page_number":75,"box":{"x":116,"y":325,"width":739,"height":13}},{"id":"b5bdca7d-f0a6-4319-8193-ce7349cd857b","block_type":"box","text":"income plus collateral investment fees.","page_number":75,"box":{"x":116,"y":340,"width":265,"height":13}},{"id":"5dfcc2a1-c1c6-4b1a-8c4a-588528690bde","block_type":"box","text":"Pursuant to the current securities lending agreement: (i) BlackRock Advantage Large Cap Core V.I. Fund,","page_number":75,"box":{"x":116,"y":363,"width":733,"height":12}},{"id":"7f51eecd-f8f3-4526-99ff-9e83ed5e9de7","block_type":"box","text":"BlackRock Advantage Large Cap Value V.I. Fund, BlackRock Advantage SMID Cap V.I. Fund, BlackRock","page_number":75,"box":{"x":116,"y":378,"width":745,"height":13}},{"id":"244090cb-c48b-425e-8a3a-9e0fb766db54","block_type":"box","text":"Basic Value V.I. Fund, BlackRock Capital Appreciation V.I. Fund, BlackRock Equity Dividend V.I. Fund,","page_number":75,"box":{"x":116,"y":393,"width":733,"height":13}},{"id":"ea647d88-8b10-4ee2-b3bb-f44a70825dac","block_type":"box","text":"BlackRock Global Allocation V.I. Fund, BlackRock Large Cap Focus Growth V.I. Fund, BlackRock Managed","page_number":75,"box":{"x":116,"y":408,"width":765,"height":13}},{"id":"ac9a1c04-9065-4977-8634-4be4386fbc65","block_type":"box","text":"Volatility V.I. Fund, BlackRock S&P 500 Index V.I. Fund and BlackRock Small Cap Index V.I. Fund retain","page_number":75,"box":{"x":116,"y":423,"width":748,"height":13}},{"id":"b19db90d-89fa-4c44-87f3-e23c2057ac34","block_type":"box","text":"81% of securities lending income (which excludes collateral investment fees); and (ii) this amount can never","page_number":75,"box":{"x":117,"y":438,"width":745,"height":13}},{"id":"7f6baa17-e1b4-4ac3-aec6-cdda18323a20","block_type":"box","text":"be less than 70% of the sum of securities lending income plus collateral investment fees.","page_number":75,"box":{"x":116,"y":453,"width":608,"height":13}},{"id":"7664822e-a4f6-40f1-971f-67fc90c51a68","block_type":"box","text":"Pursuant to the current securities lending agreement:","page_number":75,"box":{"x":116,"y":476,"width":363,"height":13}},{"id":"f3790090-de43-4f0e-8a2c-8302c4850a4a","block_type":"box","text":"(i) BlackRock 60/40 Target Allocation ETF V.I.","page_number":75,"box":{"x":486,"y":476,"width":328,"height":13}},{"id":"27b8bd5c-9c50-4cb4-b067-c5b777a2ab69","block_type":"box","text":"Fund, BlackRock International Index V.I. Fund and BlackRock International V.I. Fund retain 82% of","page_number":75,"box":{"x":116,"y":492,"width":707,"height":12}},{"id":"dc53f1e1-ee90-4401-9eab-ccf2ab8ce256","block_type":"box","text":"securities lending income (which excludes collateral investment fees); and (ii) this amount can never be less","page_number":75,"box":{"x":116,"y":507,"width":738,"height":13}},{"id":"8536dabe-34de-4fe2-bc28-4e91c2ab6f90","block_type":"box","text":"than 70% of the sum of securities lending income plus collateral investment fees.","page_number":75,"box":{"x":116,"y":523,"width":559,"height":13}},{"id":"a077ef95-3fef-47de-ab21-4589f5d745bd","block_type":"box","text":"In addition, commencing the business day following the date that the aggregate securities lending income","page_number":75,"box":{"x":116,"y":546,"width":727,"height":13}},{"id":"9200ebab-5bc5-4250-9a43-c57f14d89584","block_type":"box","text":"earned across the BlackRock Multi-Asset Complex in a","page_number":75,"box":{"x":116,"y":561,"width":384,"height":13}},{"id":"105962df-ff4f-41e3-9cdb-9f093f2a3d46","block_type":"box","text":"calendar year exceeds specific thresholds, each Fund,","page_number":75,"box":{"x":505,"y":561,"width":365,"height":13}},{"id":"7a436b68-df6d-4697-b08f-4bd41f6014e7","block_type":"box","text":"pursuant to the current securities lending agreement, will receive for the remainder of that calendar year","page_number":75,"box":{"x":116,"y":577,"width":720,"height":13}},{"id":"b29afd58-53ee-4bcd-9a40-e741b1f22a5d","block_type":"box","text":"securities lending income as follows:","page_number":75,"box":{"x":116,"y":592,"width":251,"height":13}},{"id":"42d6368f-e94c-4699-aed8-b8dc1d49820f","block_type":"box","text":"BlackRock Government Money Market V.I. Fund","page_number":75,"box":{"x":116,"y":615,"width":364,"height":13}},{"id":"5319b559-9af8-4e30-9004-164400dbe242","block_type":"box","text":"(i) if the Fund were to engage in securities lending, 85% of securities lending income (which excludes","page_number":75,"box":{"x":117,"y":638,"width":698,"height":13}},{"id":"e4f26c25-ae7c-4e8d-97e9-336e457f77f6","block_type":"box","text":"collateral investment fees); and (ii) this amount can never be less than 70% of the sum of securities lending","page_number":75,"box":{"x":116,"y":654,"width":739,"height":12}},{"id":"5e7ad1a6-50fc-47eb-879c-bcf051a2ae57","block_type":"box","text":"income plus collateral investment fees.","page_number":75,"box":{"x":116,"y":669,"width":265,"height":13}},{"id":"9de75ddc-d916-4ef6-b2de-b6368667544e","block_type":"box","text":"BlackRock Advantage Large Cap Core V.I. Fund, BlackRock Advantage Large Cap Value V.I. Fund,","page_number":75,"box":{"x":116,"y":692,"width":705,"height":13}},{"id":"cf0fe81e-948e-49c8-b701-2823c854d024","block_type":"box","text":"BlackRock Advantage SMID Cap V.I. Fund, BlackRock Basic Value V.I. Fund, BlackRock Capital","page_number":75,"box":{"x":116,"y":708,"width":692,"height":12}},{"id":"2914a2c7-4e17-4ca9-a801-5c4d8fa5c135","block_type":"box","text":"Appreciation V.I. Fund, BlackRock Equity Dividend V.I. Fund, BlackRock Global Allocation V.I. Fund,","page_number":75,"box":{"x":116,"y":723,"width":728,"height":13}},{"id":"f99b9d26-d720-40e2-a24d-74a53c0f35d9","block_type":"box","text":"BlackRock Large Cap Focus Growth V.I. Fund, Blac","page_number":75,"box":{"x":116,"y":739,"width":370,"height":12}},{"id":"af32e675-3279-42d1-9729-cee554ad3504","block_type":"box","text":"kRock Managed Volatility V.I. Fund, BlackRock S&P","page_number":75,"box":{"x":487,"y":739,"width":379,"height":12}},{"id":"a488e809-db32-4b42-a9e6-6b23fc0f5251","block_type":"box","text":"500 Index V.I. Fund and BlackRock Small Cap Index V.I. Fund","page_number":75,"box":{"x":116,"y":754,"width":447,"height":13}},{"id":"28998ce8-51b0-44ca-aaf4-3e3037d4c1ac","block_type":"box","text":"(i) 84% of securities lending income (which excludes collateral investment fees); and (ii) this amount can never","page_number":75,"box":{"x":117,"y":777,"width":765,"height":13}},{"id":"0ab8d680-aaf5-4008-8bb7-a541ef3faf9d","block_type":"box","text":"be less than 70% of the sum of securities lending income plus collateral investment fees.","page_number":75,"box":{"x":116,"y":793,"width":608,"height":12}},{"id":"fdce4d14-28f5-442f-85f8-187da9d874f3","block_type":"box","text":"BlackRock 60/40 Target Allocation ETF V.I. Fund, BlackRock International Index V.I. Fund and","page_number":75,"box":{"x":116,"y":815,"width":713,"height":13}},{"id":"fbd4252b-77dd-41ba-86e6-1a4bd4a29430","block_type":"box","text":"BlackRock International V.I. Fund","page_number":75,"box":{"x":116,"y":831,"width":255,"height":10}},{"id":"05fc858d-35c7-49e9-b4aa-d8fc89ba4c80","block_type":"box","text":"(i) 85% of securities lending income (which excludes collateral investment fees); and (ii) this amount can never","page_number":75,"box":{"x":117,"y":854,"width":765,"height":13}},{"id":"f753b560-8f9c-49b3-8356-a2016d9c86e3","block_type":"box","text":"be less than 70% of the sum of securities lending income plus collateral investment fees.","page_number":75,"box":{"x":116,"y":869,"width":608,"height":13}},{"id":"8ca9f757-ef51-4d3f-ba06-9564d376d220","block_type":"box","text":"I-57","page_number":75,"box":{"x":485,"y":917,"width":29,"height":9}},{"id":"ce31a479-7d95-4d97-b7d3-4f0380c704f4","block_type":"box","text":"NM1026U-6004382-75/605","page_number":75,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"d210ae46-d829-4281-b552-9079eff5a2a3","block_type":"box","text":"The services provided to BlackRock 60/40 Target Allocation ETF V.I. Fund, BlackRock Advantage Large Cap","page_number":76,"box":{"x":116,"y":79,"width":765,"height":13}},{"id":"24edf9f5-d860-412f-bf84-0639f2b59339","block_type":"box","text":"Core V.I. Fund, BlackRock Advantage Large Cap Value V.I. Fund, BlackRock Advantage SMID Cap V.I.","page_number":76,"box":{"x":117,"y":94,"width":732,"height":13}},{"id":"51c9e772-916f-4a20-aab1-7ade9a217289","block_type":"box","text":"Fund, BlackRock Basic Value V.I. Fund, BlackRock Capital Appreciation V.I. Fund, BlackRock Equity","page_number":76,"box":{"x":116,"y":110,"width":715,"height":13}},{"id":"511e896e-56f2-4703-b743-9f2e84da5038","block_type":"box","text":"Dividend V.I. Fund, BlackRock Global Allocation V.I. Fund, BlackRock International Index V.I. Fund,","page_number":76,"box":{"x":116,"y":125,"width":715,"height":13}},{"id":"bed19c12-5512-4bad-958b-32a88f6eafc2","block_type":"box","text":"BlackRock International V.I. Fund, BlackRock Large Cap Focus Growth V.I. Fund, BlackRock Managed","page_number":76,"box":{"x":116,"y":141,"width":731,"height":13}},{"id":"aef30f9f-69b7-4e43-9a0f-b1221d176fcf","block_type":"box","text":"Volatility V.I. Fund, BlackRock S&P 500 Index V.I. Fund and BlackRock Small Cap Index V.I. Fund by BIM,","page_number":76,"box":{"x":116,"y":156,"width":765,"height":13}},{"id":"af1343fe-82d0-4ccc-acdc-00c5430c64ef","block_type":"box","text":"in the most recent fiscal year ended December 31, 2025, primarily included the following:","page_number":76,"box":{"x":116,"y":172,"width":622,"height":13}},{"id":"55233604-7f9c-47ff-a6a2-f937c9c03d40","block_type":"box","text":"(1) selecting borrowers from an approved list of bo","page_number":76,"box":{"x":117,"y":195,"width":353,"height":13}},{"id":"0e2f4507-8892-4356-839d-f82cd3cc5d6c","block_type":"box","text":"rrowers and executing a securities lending agreement as","page_number":76,"box":{"x":471,"y":195,"width":384,"height":13}},{"id":"00c9b044-afbe-4c7f-920b-e7dddcb27b03","block_type":"box","text":"agent on behalf of each of the Funds listed above with each such borrower;","page_number":76,"box":{"x":116,"y":211,"width":520,"height":12}},{"id":"7300d046-6aa5-4c1f-988e-875f026924fc","block_type":"box","text":"(2) negotiating the terms of securities loans, including the amount of fees;","page_number":76,"box":{"x":117,"y":234,"width":507,"height":13}},{"id":"9cfb835b-9d99-4d86-acb7-2aa385d1292e","block_type":"box","text":"(3) directing the delivery of loaned securities;","page_number":76,"box":{"x":117,"y":257,"width":309,"height":13}},{"id":"d6610c21-a749-4793-94ab-a7e2571d8c72","block_type":"box","text":"(4) monitoring the daily value of the loaned securities and directing the payment of additional collateral or the","page_number":76,"box":{"x":117,"y":280,"width":762,"height":13}},{"id":"b79e09bc-14a9-4941-a383-534657284785","block_type":"box","text":"return of excess collateral, as necessary;","page_number":76,"box":{"x":116,"y":296,"width":274,"height":13}},{"id":"be97891c-3a9a-406d-9e44-d844cae03583","block_type":"box","text":"(5) investing cash collateral received in connection with any loaned securities;","page_number":76,"box":{"x":117,"y":319,"width":534,"height":13}},{"id":"4dd0d935-91cc-45df-8df2-c439b1f9f1fb","block_type":"box","text":"(6) monitoring distributions on loaned securitie","page_number":76,"box":{"x":117,"y":342,"width":327,"height":13}},{"id":"fc5fe1c6-e898-4b11-93e3-7607ce596a95","block_type":"box","text":"s (for example, interest and dividend activity);","page_number":76,"box":{"x":445,"y":342,"width":317,"height":13}},{"id":"274b3393-2468-4b32-8faf-6b3ea8e039a4","block_type":"box","text":"(7) in the event of default by a borrower with respect to any securities loan, using the collateral or the","page_number":76,"box":{"x":117,"y":366,"width":702,"height":12}},{"id":"ec92ebfc-3f14-4352-a3b0-f946da96c911","block_type":"box","text":"proceeds of the liquidation of collateral to purchase rep","page_number":76,"box":{"x":116,"y":381,"width":384,"height":13}},{"id":"3bd00135-2ec4-48b4-bd35-8bf6b7657825","block_type":"box","text":"lacement securities of the same issue, type, class and","page_number":76,"box":{"x":501,"y":381,"width":360,"height":13}},{"id":"659f44d3-9456-466a-9a8d-9e91135baba7","block_type":"box","text":"series as that of the loaned securities; and","page_number":76,"box":{"x":116,"y":397,"width":286,"height":12}},{"id":"fd5c1308-1b63-4f5a-b70a-ec3d598d07a5","block_type":"box","text":"(8) terminating securities loans and arranging for the return of loaned securities to each of the Funds listed","page_number":76,"box":{"x":117,"y":420,"width":736,"height":13}},{"id":"21d8a7cc-a540-4884-ad1e-6b756c6d9782","block_type":"box","text":"above at loan termination.","page_number":76,"box":{"x":116,"y":435,"width":183,"height":10}},{"id":"87eed31a-8f78-4f7b-ba12-c58ac2c48642","block_type":"box","text":"The following tables show the dollar amounts of incom","page_number":76,"box":{"x":116,"y":459,"width":385,"height":12}},{"id":"6b7331e5-e72a-4fde-b6f1-d4b24cb86993","block_type":"box","text":"e and fees/compensation related to the securities","page_number":76,"box":{"x":502,"y":459,"width":332,"height":12}},{"id":"8543f252-eb4d-4a99-be61-e3b8abd65a53","block_type":"box","text":"lending activities of each applicable Fund during its most recent fiscal year ended December 31, 2025.","page_number":76,"box":{"x":116,"y":474,"width":705,"height":13}},{"id":"9ccd8312-8889-4961-be66-8a8cc5c365b6","block_type":"box","text":"BlackRock","page_number":76,"box":{"x":506,"y":512,"width":63,"height":8}},{"id":"f10beef5-fc8f-4815-b598-ea65df1617e5","block_type":"box","text":"60/40 Target","page_number":76,"box":{"x":499,"y":523,"width":77,"height":10}},{"id":"b1d709e5-cf9b-464e-aeff-045b5efa2b8d","block_type":"box","text":"Allocation ETF","page_number":76,"box":{"x":493,"y":533,"width":89,"height":8}},{"id":"fa5022e4-7cae-44b4-a2ca-e4cd7c6f857f","block_type":"box","text":"V.I. Fund","page_number":76,"box":{"x":510,"y":543,"width":55,"height":8}},{"id":"3d3488db-ae62-4f3c-a6cd-fa40afde4bee","block_type":"box","text":"BlackRock","page_number":76,"box":{"x":619,"y":502,"width":63,"height":8}},{"id":"2e541a9d-46f2-4920-9f20-2a28c0da9240","block_type":"box","text":"Advantage","page_number":76,"box":{"x":620,"y":512,"width":62,"height":11}},{"id":"ddb4743f-24dd-4ce3-9974-662ddbe6c4c9","block_type":"box","text":"Large","page_number":76,"box":{"x":635,"y":523,"width":32,"height":10}},{"id":"feafaa1a-621b-4249-894d-9af10a7049bc","block_type":"box","text":"Cap Core","page_number":76,"box":{"x":623,"y":533,"width":56,"height":10}},{"id":"e8a0328c-819c-45c8-b90a-fc89df6b144d","block_type":"box","text":"V.I. 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Fund","page_number":77,"box":{"x":822,"y":660,"width":55,"height":8}},{"id":"85c92f1b-a5ec-43ec-adb8-e309b7b4abb9","block_type":"box","text":"Gross income from securities lending activities","page_number":77,"box":{"x":116,"y":679,"width":268,"height":10}},{"id":"964c5a7c-96c4-44c7-93d0-5e290903ea2b","block_type":"box","text":"$82,559 $2,400,135 $2,256,381","page_number":77,"box":{"x":617,"y":679,"width":265,"height":10}},{"id":"b3325708-0088-4f31-a6aa-f794dc6a005e","block_type":"box","text":"Fees and/or compensation for securities lending activities and related services","page_number":77,"box":{"x":116,"y":699,"width":445,"height":10}},{"id":"00f06dc1-42a4-4658-a3e7-a58ae07dba83","block_type":"box","text":"Securities lending income paid to BIM for services as securities lending agent $867 $34,919 $68,737","page_number":77,"box":{"x":116,"y":714,"width":758,"height":10}},{"id":"03abca78-c595-410e-9515-db7e32077263","block_type":"box","text":"Cash collateral management expenses not included in securities lending\r\nd","page_number":77,"box":{"x":116,"y":729,"width":412,"height":10}},{"id":"af03423e-c876-4af3-a00e-5342f8f2b85b","block_type":"box","text":"income paid to BIM","page_number":77,"box":{"x":116,"y":739,"width":116,"height":10}},{"id":"2f3d8e98-88ff-4ef8-96cb-701059876536","block_type":"box","text":"$735 $20,780 $18,905","page_number":77,"box":{"x":626,"y":739,"width":247,"height":10}},{"id":"7a7b6603-55d0-4cbd-b8d5-dab2f08bc4ad","block_type":"box","text":"Administrative fees not included in securities lending income paid to BIM $0 $0 $0","page_number":77,"box":{"x":116,"y":754,"width":740,"height":10}},{"id":"0cc7cdc0-82e3-4ddd-8567-446c26b8de32","block_type":"box","text":"Indemnification fees not included in securities lending income paid to BIM $0 $0 $0","page_number":77,"box":{"x":116,"y":769,"width":740,"height":10}},{"id":"3aabb622-c027-4bf7-967c-5db393c3697f","block_type":"box","text":"Rebates (paid to borrowers) $76,998 $2,187,770 $1,874,450","page_number":77,"box":{"x":116,"y":784,"width":767,"height":11}},{"id":"3a0ab70b-e541-4273-b11c-48f5d2a04f00","block_type":"box","text":"Other fees not included in securities lending income paid to BIM $0 $0 $0","page_number":77,"box":{"x":116,"y":799,"width":740,"height":11}},{"id":"d05dfd5e-ea36-493a-94ae-f8571afa749d","block_type":"box","text":"Aggregate fees/compensation for securities lending activities","page_number":77,"box":{"x":116,"y":814,"width":347,"height":11}},{"id":"404be0eb-20d1-474f-a767-d63d675acfd2","block_type":"box","text":"$78,600 $2,243,469 $1,962,092","page_number":77,"box":{"x":617,"y":814,"width":266,"height":10}},{"id":"b7c2f256-0c74-464e-9617-2199170f8ca0","block_type":"box","text":"Net income from securities lending activities","page_number":77,"box":{"x":116,"y":835,"width":256,"height":10}},{"id":"26ee2ec6-a7f1-4ad0-8644-19d370485832","block_type":"box","text":"$3,959 $156,666 $294,289","page_number":77,"box":{"x":620,"y":834,"width":257,"height":10}},{"id":"68bcd25a-0ebf-43c7-af6b-cebe507f0369","block_type":"box","text":"I-59","page_number":77,"box":{"x":485,"y":917,"width":28,"height":9}},{"id":"0383f76a-07d0-4ac8-a748-7868abab2eb4","block_type":"box","text":"NM1026U-6004382-77/605","page_number":77,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"e79cac6b-a436-439c-9b98-11ecbe6fac1f","block_type":"box","text":"BlackRock Government Money Market V.I. Fund had no income and fees/compensation related to its","page_number":78,"box":{"x":116,"y":79,"width":708,"height":13}},{"id":"837643db-de46-4769-aee8-7d9acfd50bf2","block_type":"box","text":"securities lending activities during its most recent fiscal year ended December 31, 2025.","page_number":78,"box":{"x":116,"y":94,"width":603,"height":13}},{"id":"5ff5cc57-2502-4011-8afb-d5c9dc4d10e2","block_type":"box","text":"VIII. Purchase of Shares","page_number":78,"box":{"x":116,"y":122,"width":202,"height":10}},{"id":"46dd61ef-773a-4b24-adc2-683f1d15541f","block_type":"box","text":"The Company continuously offers shares of Class I Shares, Class II Shares and Class III Shares of the Funds at","page_number":78,"box":{"x":116,"y":147,"width":762,"height":13}},{"id":"0f3dd33a-0e4d-49b7-9577-460562d622a3","block_type":"box","text":"prices equal to the per share net asset value of the Fund. BRIL, an affiliate of the Manager, acts as the Funds’","page_number":78,"box":{"x":116,"y":163,"width":754,"height":13}},{"id":"16de229e-c701-41ae-8f95-55d5fe195780","block_type":"box","text":"sole Distributor.","page_number":78,"box":{"x":116,"y":178,"width":112,"height":10}},{"id":"613c9480-7203-488c-8e8f-4ca0746ebabe","block_type":"box","text":"Net asset value is determined in the manner set forth under “Determination of Net Asset Value.”","page_number":78,"box":{"x":116,"y":201,"width":672,"height":10}},{"id":"e6dd0c3f-b891-463e-85ab-407b07e1c872","block_type":"box","text":"The Company and the Distributor reserve the right to suspend the sale of shares of the Funds in response to","page_number":78,"box":{"x":116,"y":224,"width":746,"height":13}},{"id":"fc17c57a-34d7-4b2f-bb42-84e848e3abdf","block_type":"box","text":"conditions in the securities markets or otherwise. Any order may be rejected by the Company or the","page_number":78,"box":{"x":116,"y":239,"width":692,"height":13}},{"id":"b521169a-0e9a-4bcb-8c0e-813452e36eeb","block_type":"box","text":"Distributor. Generally, only Separate Accounts of Insurance Companies may purchase Fund shares for the","page_number":78,"box":{"x":116,"y":255,"width":737,"height":13}},{"id":"0848a365-8f48-4f9d-be3d-8fa78b14125f","block_type":"box","text":"benefit of such Insurance Company’s owners who elect to have all or a portion of their premium contributions","page_number":78,"box":{"x":116,"y":270,"width":767,"height":13}},{"id":"f2e00353-34c8-4b87-a6ab-48dd300e1938","block_type":"box","text":"invested in shares of a Fund. Accordingly, each Separate Account that owns shares of a Fund maintains","page_number":78,"box":{"x":116,"y":286,"width":717,"height":13}},{"id":"c809c5e6-203f-4eac-b335-d3d5ab7e9cad","block_type":"box","text":"omnibus accounts with the Funds’ Transfer Agent for the benefit of the Insurance Company’s Contract","page_number":78,"box":{"x":116,"y":301,"width":715,"height":13}},{"id":"48368a45-5e28-4116-9ff2-970a6e9454f6","block_type":"box","text":"owners, often resulting in considerable savings in administrative expenses for the Funds’ management.","page_number":78,"box":{"x":116,"y":317,"width":708,"height":13}},{"id":"c3b19ce1-2420-4c33-8fbe-65c0c27288c8","block_type":"box","text":"IX. Special Tax Rules Applicable to Variable Contracts","page_number":78,"box":{"x":116,"y":345,"width":441,"height":12}},{"id":"5926bdf2-bdbd-4743-b96d-4f383baad172","block_type":"box","text":"Each Fund has elected to be treated, and intends to qualify each year, as a regulated investment company","page_number":78,"box":{"x":116,"y":367,"width":728,"height":13}},{"id":"1ddb443b-8390-4bbe-8948-cce07289e5f5","block_type":"box","text":"under the Internal Revenue Code. In order to qualify to be taxable as a regulated investment company, each","page_number":78,"box":{"x":116,"y":383,"width":749,"height":13}},{"id":"abf42025-29e4-4760-9a18-8f4f040b0d87","block_type":"box","text":"Fund must meet certain income and asset diversification tests and distribution requirements. As regulated","page_number":78,"box":{"x":116,"y":398,"width":730,"height":13}},{"id":"bc5a1945-1e02-446a-adb6-953024c3c50f","block_type":"box","text":"investment companies, the Funds will not be subject to U.S. federal income tax on their net investment income","page_number":78,"box":{"x":116,"y":414,"width":765,"height":13}},{"id":"ee30746f-bb0a-4aa7-b05f-83ebd768e45b","block_type":"box","text":"and net capital gains that they distribute to their shareholders.","page_number":78,"box":{"x":116,"y":429,"width":430,"height":13}},{"id":"d3dde61f-46c8-4eb6-8011-3836696f2b8d","block_type":"box","text":"Distributions made by a Portfolio to an Account, and exchanges and redemptions of Portfolio shares made by","page_number":78,"box":{"x":116,"y":452,"width":763,"height":13}},{"id":"335cc038-d13c-4bc0-bebe-4d4b9e22ef89","block_type":"box","text":"an Account, ordinarily do not cause the corresponding Contract holder to recognize income or gain for U.S.","page_number":78,"box":{"x":116,"y":468,"width":748,"height":13}},{"id":"0fa46d30-900f-421f-bf4f-6dd75fd08007","block_type":"box","text":"federal income tax purposes. See the Contract prospectus for information regarding the U.S. federal income","page_number":78,"box":{"x":116,"y":483,"width":745,"height":13}},{"id":"7bdd6f3a-de69-4c4a-bdce-06fcaef350fc","block_type":"box","text":"tax treatment of the distributions to Accounts and the holders of the Contracts.","page_number":78,"box":{"x":116,"y":499,"width":550,"height":10}},{"id":"835f2671-bb60-4932-918b-d15335086f54","block_type":"box","text":"In order for the Contract holders to be eligible for such U.S. federal income tax deferral, each separate account","page_number":78,"box":{"x":116,"y":522,"width":766,"height":12}},{"id":"91edfba4-c992-4aa5-87cd-9e94d86e7fb1","block_type":"box","text":"of the Insurance Companies (referred to as “segregated asset accounts” for U.S. federal income tax purposes)","page_number":78,"box":{"x":116,"y":537,"width":755,"height":13}},{"id":"b86b1dd8-29bc-4174-bb76-e9f302451b30","block_type":"box","text":"must comply with certain asset diversification requirements and investor control prohibitions.","page_number":78,"box":{"x":116,"y":553,"width":649,"height":12}},{"id":"b5b6b833-b3ab-4f89-bea0-4593addae950","block_type":"box","text":"Diversification Requirements","page_number":78,"box":{"x":116,"y":575,"width":212,"height":13}},{"id":"d3833e51-f798-4d21-924d-02838efe84e7","block_type":"box","text":"Specifically, each segregated asset account is required to comply with the diversification requirements of","page_number":78,"box":{"x":116,"y":598,"width":721,"height":13}},{"id":"88d46323-3364-4142-bca2-c8feb7c2f802","block_type":"box","text":"Section 817(h) of the Internal Revenue Code and the regul","page_number":78,"box":{"x":116,"y":614,"width":404,"height":12}},{"id":"df5359aa-7c34-464b-ab99-65ce5d3be19e","block_type":"box","text":"ations thereunder relating to the tax-deferred status","page_number":78,"box":{"x":521,"y":614,"width":356,"height":12}},{"id":"a6d883c2-4832-49fe-8b66-327b5b6284c8","block_type":"box","text":"of segregated asset accounts. If a segregated asset account fails these requirements, (i) the Contract would not","page_number":78,"box":{"x":116,"y":629,"width":757,"height":13}},{"id":"ef475d12-38cf-4d25-b924-2c395398b634","block_type":"box","text":"be treated as an annuity or life insurance contract under the Internal Revenue Code and (ii) the holders of","page_number":78,"box":{"x":116,"y":645,"width":733,"height":12}},{"id":"e85cfb7e-a2e4-4fbc-93a5-ed04c4e7c1c7","block_type":"box","text":"such Contract would be required to include as ordinary income the “income on the contract” for each taxable","page_number":78,"box":{"x":116,"y":660,"width":764,"height":13}},{"id":"6e5a09ee-c34d-4548-9e08-34e23439117b","block_type":"box","text":"year. Generally, the “income on the contract” is the excess of (i) the sum of the increase in the net surrender","page_number":78,"box":{"x":116,"y":676,"width":747,"height":12}},{"id":"9f8c50d4-c2c7-49d5-88c2-9305d2b89067","block_type":"box","text":"value of the Contract during the taxable year and the cost of the life insurance protection provided under the","page_number":78,"box":{"x":116,"y":691,"width":754,"height":13}},{"id":"c526f797-1e0f-49bb-bb17-195a47416535","block_type":"box","text":"Contract during the year, over (ii) the premiums paid under the Contract during the taxable year. Contract","page_number":78,"box":{"x":117,"y":707,"width":740,"height":12}},{"id":"1670db50-faea-444f-a063-3e7aceee6aa9","block_type":"box","text":"holders could also be taxable in future years even if the segregated asset account subsequently complied with","page_number":78,"box":{"x":116,"y":722,"width":753,"height":13}},{"id":"41d4f242-9828-42c9-b277-d9326b8044b4","block_type":"box","text":"the diversification tests.","page_number":78,"box":{"x":116,"y":738,"width":162,"height":10}},{"id":"db7ade33-8c7c-4588-b146-5204f6a77418","block_type":"box","text":"To satisfy these diversification requirements, as of the end of each calendar quarter or within 30 days thereafter,","page_number":78,"box":{"x":116,"y":760,"width":757,"height":13}},{"id":"5fd1aa6e-21a2-4ceb-8fc8-66db4ea1a207","block_type":"box","text":"each segregated asset account must meet one of two tests. Either (i) the segregated asset account must have no","page_number":78,"box":{"x":116,"y":776,"width":743,"height":13}},{"id":"e57fa36e-a4d5-48da-8dd8-ef4670b372e5","block_type":"box","text":"more than 55% of its total assets represented by any one investment, no more than 70% of its total assets","page_number":78,"box":{"x":116,"y":792,"width":717,"height":12}},{"id":"cd8ba36a-5332-4872-aa4b-8aaf4082e555","block_type":"box","text":"represented by any two investments, no more than 80% of its total assets represented by any three investments,","page_number":78,"box":{"x":116,"y":807,"width":754,"height":13}},{"id":"6651a49a-caf1-455f-aafa-57cc69b0b245","block_type":"box","text":"and no more than 90% of its total assets represented by any four investments or (ii) the segregated asset account","page_number":78,"box":{"x":116,"y":823,"width":761,"height":12}},{"id":"69a1df98-8e52-4abe-8997-4a96e9474ea1","block_type":"box","text":"must both (a) meet all the tax diversification requirements under Section 851(b)(3) of the Internal Revenue Code","page_number":78,"box":{"x":116,"y":838,"width":762,"height":13}},{"id":"e1fd9762-97a4-44fc-ba8e-87ecf67a91db","block_type":"box","text":"(which are applicable to all regulated investment companies) and (b) have no more than 55% of the value of its","page_number":78,"box":{"x":117,"y":854,"width":753,"height":12}},{"id":"82ba4277-d878-4786-867c-09590baa4660","block_type":"box","text":"total assets be attributable to cash, cash items (including receivables), Government securities or securities of other","page_number":78,"box":{"x":116,"y":869,"width":765,"height":13}},{"id":"171b25ae-fe4f-4158-90cf-6ac6b810cc14","block_type":"box","text":"I-60","page_number":78,"box":{"x":485,"y":917,"width":29,"height":9}},{"id":"8d31a3c9-3da0-4607-99b5-4df693987c5e","block_type":"box","text":"NM1026U-6004382-78/605","page_number":78,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"292ffc78-19ac-43ed-80b3-4ecd29fb5f76","block_type":"box","text":"regulated investment companies. For purposes of the first test, all securities of the same issuer are considered a","page_number":79,"box":{"x":116,"y":79,"width":744,"height":13}},{"id":"3ceb4f9b-d76a-4827-9b2f-0e6f34e4af59","block_type":"box","text":"single investment, but in the case of Government securities, each Government agency or instrumentality is","page_number":79,"box":{"x":116,"y":94,"width":715,"height":13}},{"id":"fb5ffa2b-6e15-4926-9cbb-ee0c28ca55ed","block_type":"box","text":"considered to be a separate issuer. An alternative test to establish diversification may be available under certain","page_number":79,"box":{"x":116,"y":110,"width":749,"height":13}},{"id":"eba196ff-6cd3-4d67-865d-0bafdf4c91c8","block_type":"box","text":"circumstances.","page_number":79,"box":{"x":116,"y":126,"width":98,"height":9}},{"id":"07d65470-b854-4916-b695-24dce774b6bf","block_type":"box","text":"Section 817(h) of the Internal Revenue Code provides a look-through rule for purposes of testing the","page_number":79,"box":{"x":116,"y":149,"width":698,"height":12}},{"id":"6bffda87-865b-41f4-9838-6924b9ecd3ec","block_type":"box","text":"diversification of a segregated asset account that invests in a regulated investment company such as a Fund. If","page_number":79,"box":{"x":116,"y":164,"width":759,"height":13}},{"id":"0962b604-cf24-467a-b85c-20bd37f23bf3","block_type":"box","text":"the look-through rule applies, a beneficial interest in a regulated investment company will not be treated as a","page_number":79,"box":{"x":116,"y":180,"width":753,"height":12}},{"id":"14b9c0be-045d-4471-95fd-86549275b1cc","block_type":"box","text":"single investment of a segregated asset account for purposes of the diversification requirements described","page_number":79,"box":{"x":116,"y":195,"width":726,"height":13}},{"id":"546dc544-3ee6-4aa5-994a-b1a34fb86551","block_type":"box","text":"above; instead, a pro rata portion of each asset of the regulated investment company will be treated as an asset","page_number":79,"box":{"x":116,"y":211,"width":767,"height":12}},{"id":"9844f1f2-92e7-49ee-b091-7a1821838cd1","block_type":"box","text":"of the segregated asset account. Treasury Regulations Section 1.817-5(f)(2) provides (except as otherwise","page_number":79,"box":{"x":116,"y":226,"width":728,"height":13}},{"id":"80741c0b-9681-4d16-a83b-6d00f7ff8e55","block_type":"box","text":"permitted) that the look-through rule will apply to a regulated investment company only if (i) all the beneficial","page_number":79,"box":{"x":116,"y":242,"width":765,"height":12}},{"id":"65fd9d12-e6c3-48af-bcd4-d41c7247fb42","block_type":"box","text":"interests in the regulated investment company are held by one or more segregated asset accounts of one or","page_number":79,"box":{"x":116,"y":257,"width":735,"height":13}},{"id":"887ceede-8d8d-4559-b402-3432030d1b8f","block_type":"box","text":"more insurance companies and (ii) public access to such reg","page_number":79,"box":{"x":116,"y":273,"width":413,"height":12}},{"id":"7c5fcc3f-ea65-4d54-a6cf-0b0e489a3c14","block_type":"box","text":"ulated investment company is available exclusively","page_number":79,"box":{"x":529,"y":273,"width":351,"height":12}},{"id":"9d8ffce6-58c8-4614-9ee7-725ad4e3c559","block_type":"box","text":"through the purchase of a variable contract. Failure by the Fund to satisfy the Section 817(h) requirements by","page_number":79,"box":{"x":116,"y":288,"width":759,"height":13}},{"id":"e9aa6fd6-6021-4139-a106-122bde3d2e82","block_type":"box","text":"failing to comply with the “55%-70%-80%-90%” diversification test or the safe harbor described above","page_number":79,"box":{"x":116,"y":304,"width":730,"height":12}},{"id":"1251938e-07bc-4095-9243-0c414baee544","block_type":"box","text":"could cause the variable contracts to lose their favora","page_number":79,"box":{"x":116,"y":319,"width":369,"height":10}},{"id":"21df86ba-3011-4717-99ba-d15135159523","block_type":"box","text":"ble tax status and require a contract holder to include in","page_number":79,"box":{"x":486,"y":319,"width":389,"height":13}},{"id":"121b8fdd-457f-4c43-ada5-32018fb18142","block_type":"box","text":"ordinary income any income accrued under the contracts for the current and all prior taxable years.","page_number":79,"box":{"x":116,"y":335,"width":690,"height":12}},{"id":"6b0ee641-597e-4d4c-bb57-2143ace97d3c","block_type":"box","text":"Under certain circumstances described in the applicable T","page_number":79,"box":{"x":116,"y":358,"width":399,"height":13}},{"id":"14a75e8f-7dc6-4e52-b34f-723da149e03a","block_type":"box","text":"reasury regulations, inadvertent failure to satisfy the","page_number":79,"box":{"x":516,"y":358,"width":360,"height":13}},{"id":"ce697c83-c647-493a-9947-912c3baa2498","block_type":"box","text":"Section 817(h) diversification requirements may be corrected, but such a correction could require a payment","page_number":79,"box":{"x":116,"y":373,"width":750,"height":13}},{"id":"00b9be8d-0592-494d-b76c-01adf1eb8c1a","block_type":"box","text":"to the IRS with respect to the period or periods during which the investments of the account did not meet the","page_number":79,"box":{"x":116,"y":389,"width":756,"height":13}},{"id":"1c7ae30d-f37b-4d2b-a52b-654c3b4fedc7","block_type":"box","text":"diversification requirements. The amount of any such payment could be based on the tax contract holders","page_number":79,"box":{"x":116,"y":404,"width":734,"height":13}},{"id":"cd9b4cdc-bee4-49cd-b5d4-dba5e439b4af","block_type":"box","text":"would have incurred if they were treated as receiving the income on the contract for the period during which","page_number":79,"box":{"x":116,"y":420,"width":753,"height":13}},{"id":"a95df588-dc9a-4e02-98a1-937799197d46","block_type":"box","text":"the diversification requirements were not satisfied. Any such failure could also result in adverse tax","page_number":79,"box":{"x":116,"y":435,"width":685,"height":13}},{"id":"87d6734f-0a7b-41fc-8ace-3591b757c44e","block_type":"box","text":"consequences for the Insurance Company issuing the contracts.","page_number":79,"box":{"x":116,"y":451,"width":437,"height":13}},{"id":"d504836d-c7d3-4581-8d5f-61249195b7cb","block_type":"box","text":"Investor Control Prohibitions","page_number":79,"box":{"x":116,"y":474,"width":215,"height":10}},{"id":"df6502d8-ec49-4afb-a463-9362bfbb909d","block_type":"box","text":"For a Contract to qualify for U.S. federal income tax deferral, it must avoid the prohibition on investor","page_number":79,"box":{"x":116,"y":497,"width":714,"height":13}},{"id":"f3f0952f-19ca-4ce3-bb3e-b6860b08de29","block_type":"box","text":"control so that assets in the segregated asset accounts supporting the Contract are considered to be owned for","page_number":79,"box":{"x":116,"y":513,"width":760,"height":13}},{"id":"40525fb1-4f28-4dcb-981a-7154be7a8ef3","block_type":"box","text":"U.S. federal income tax purposes by the Insurance Company and not by the Contract holder. Accordingly, a","page_number":79,"box":{"x":116,"y":528,"width":750,"height":13}},{"id":"fb131419-b3cb-4c0b-bc98-e9778ac9f74b","block_type":"box","text":"Contract holder should not have an impermissible level of control over a segregated asset account’s or a","page_number":79,"box":{"x":117,"y":544,"width":719,"height":13}},{"id":"e3089a6d-897a-4c2c-91c6-f8662596a8c4","block_type":"box","text":"Fund’s investment in any particular asset. If the Contract holder were considered the owner of the Fund shares","page_number":79,"box":{"x":116,"y":559,"width":766,"height":13}},{"id":"5363f726-040d-4f02-9175-05fbe90a88ba","block_type":"box","text":"for U.S. federal income tax purposes, income and gain earned from such Fund shares for the current, future","page_number":79,"box":{"x":116,"y":575,"width":745,"height":13}},{"id":"550290a3-206d-48bf-9389-d0554121fcfb","block_type":"box","text":"and prior taxable years would be taxable currently to the Contract holders.","page_number":79,"box":{"x":116,"y":590,"width":522,"height":13}},{"id":"3a3714f5-82dc-4189-ae93-7745770b035f","block_type":"box","text":"The IRS may consider several factors in determining whether a contract holder has an impermissible level of","page_number":79,"box":{"x":116,"y":614,"width":750,"height":12}},{"id":"4db85cc2-96b5-4ba2-b5c4-36da1613fada","block_type":"box","text":"investor control over a segregated asset account. One factor the IRS considers when a segregated asset account","page_number":79,"box":{"x":116,"y":629,"width":766,"height":13}},{"id":"03a4ced9-7e4a-4682-baaf-228af3784365","block_type":"box","text":"invests in one or more regulated investment companies is whether shares in the regulated investment","page_number":79,"box":{"x":116,"y":645,"width":695,"height":12}},{"id":"e531903b-d8b7-4716-aebb-ea663f3c82dd","block_type":"box","text":"companies are publicly available or whether such shares are available exclusively through the purchase of a","page_number":79,"box":{"x":116,"y":660,"width":743,"height":13}},{"id":"652858ec-6167-4f36-9b2d-a58ae7b77cf8","block_type":"box","text":"variable contract. Each Fund sells its shares directly to separate accounts established and maintained by","page_number":79,"box":{"x":116,"y":676,"width":717,"height":12}},{"id":"4ab6b935-bdf4-4d15-a13a-34b73008a222","block_type":"box","text":"insurance companies for the purpose of funding variable annuity and variable life insurance contracts and to","page_number":79,"box":{"x":116,"y":691,"width":752,"height":13}},{"id":"b51ab478-3084-4a3f-9824-a82fca718b49","block_type":"box","text":"certain qualified pension and retirement plans, or to other regulated investment companies meeting such","page_number":79,"box":{"x":116,"y":707,"width":723,"height":12}},{"id":"9e0a561b-f4ab-4601-a780-60ad1712a26a","block_type":"box","text":"requirements, and not to other categories of shareholders.","page_number":79,"box":{"x":116,"y":722,"width":400,"height":13}},{"id":"210fda38-ec76-4400-8e70-5031fbb5ad88","block_type":"box","text":"A second factor the IRS considers when a segregated asset account invests in one or more regulated","page_number":79,"box":{"x":116,"y":745,"width":688,"height":13}},{"id":"8f5a8ea4-5629-413c-b11a-209f9ac95d97","block_type":"box","text":"investment companies is whether a regulated investment company’s investment strategies are sufficiently","page_number":79,"box":{"x":116,"y":761,"width":723,"height":13}},{"id":"ceb62eb6-e803-48bd-93c2-6c698aaff491","block_type":"box","text":"broad and general (such as stocks, bonds or money market instruments) to prevent a Contract holder from","page_number":79,"box":{"x":116,"y":776,"width":741,"height":13}},{"id":"da866b71-4bcd-4ccc-928d-a9e2788d071c","block_type":"box","text":"being deemed to be making particular investment decisions through its investment in the segregated asset","page_number":79,"box":{"x":116,"y":792,"width":727,"height":13}},{"id":"bb680b26-fcf4-4eea-997f-ed874e69294b","block_type":"box","text":"account. Under current IRS guidance, the investment strategies of each Fund are expected to be sufficiently","page_number":79,"box":{"x":116,"y":807,"width":740,"height":13}},{"id":"67140039-1e20-4a9d-9cd6-5e742bb2bc3a","block_type":"box","text":"broad to satisfy this factor and prevent a Contract holder from being deemed to be making particular","page_number":79,"box":{"x":116,"y":823,"width":703,"height":13}},{"id":"dee7ae8b-e68f-43ed-8775-45d84a5151b7","block_type":"box","text":"investment decisions through its investment in the segregated asset account.","page_number":79,"box":{"x":116,"y":838,"width":522,"height":13}},{"id":"2ebb3151-5d3a-4076-bee9-d26f1944581e","block_type":"box","text":"I-61","page_number":79,"box":{"x":485,"y":917,"width":28,"height":9}},{"id":"25283aa1-1d0c-44a3-b413-9516dc6ca0df","block_type":"box","text":"NM1026U-6004382-79/605","page_number":79,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"dbc008bf-839e-4807-af00-e1f80ecbb447","block_type":"box","text":"Each Fund intends (1) to comply with the requirements necessary to allow a segregated asset account that","page_number":80,"box":{"x":116,"y":79,"width":733,"height":13}},{"id":"9d3dd9f4-1a59-4c55-ae02-46d6151cae61","block_type":"box","text":"invests in the Fund to look-through to the Fund’s investments for purposes of satisfying the asset","page_number":80,"box":{"x":116,"y":94,"width":669,"height":13}},{"id":"b2279d77-21b3-4ab8-820d-dd598eafe60c","block_type":"box","text":"diversification requirements of Section 817(h) of the Code, (2) to comply with such asset diversification","page_number":80,"box":{"x":116,"y":110,"width":717,"height":13}},{"id":"25d3e670-6873-4367-9093-d66eb0c15aa4","block_type":"box","text":"requirements necessary to prevent the Contract holders","page_number":80,"box":{"x":116,"y":125,"width":382,"height":13}},{"id":"bbef7cbb-2642-4b67-a4e4-c78a3a92d497","block_type":"box","text":"from losing their special tax treatment because of","page_number":80,"box":{"x":503,"y":125,"width":342,"height":13}},{"id":"af32f999-74e5-4373-84c2-7d8de3614eab","block_type":"box","text":"investments in the Fund, and (3) to comply with the re","page_number":80,"box":{"x":116,"y":141,"width":378,"height":13}},{"id":"4a03e781-df50-4fcf-bda4-8cd863bd79c6","block_type":"box","text":"quirements necessary to prevent the Contract holders","page_number":80,"box":{"x":494,"y":141,"width":369,"height":13}},{"id":"c3119ba4-9a92-4154-bcb1-da344c39d826","block_type":"box","text":"from having an impermissible level of control over the Fund’s assets.","page_number":80,"box":{"x":116,"y":156,"width":474,"height":13}},{"id":"dcc52016-674e-40c9-868f-717c9671539e","block_type":"box","text":"In the event that additional rules, regulations or other guidance is issued by the IRS or the Treasury","page_number":80,"box":{"x":116,"y":179,"width":688,"height":13}},{"id":"8db8a2b0-37c4-4cf4-a8fb-f1a3e1326ba9","block_type":"box","text":"Department concerning this issue, such guidance could affect the treatment of the Fund as described above,","page_number":80,"box":{"x":116,"y":195,"width":743,"height":12}},{"id":"030c7568-51e6-455e-b3bb-76557a1a2f1a","block_type":"box","text":"including retroactively. In addition, there can be no assurance that the Fund will be able to continue to","page_number":80,"box":{"x":116,"y":210,"width":711,"height":13}},{"id":"65c1b87b-3053-45b1-b598-f57c9aebb4a9","block_type":"box","text":"operate as currently described, or that the Fund will not have to change its investment objective or investment","page_number":80,"box":{"x":116,"y":226,"width":761,"height":12}},{"id":"f787bc7d-706c-4f8b-895a-27cbea1cdc9c","block_type":"box","text":"policies in order to prevent, on a prospective basis, any such rules and regulations from causing variable","page_number":80,"box":{"x":116,"y":241,"width":720,"height":13}},{"id":"05623275-7f53-4342-9038-32990ba28a70","block_type":"box","text":"contract owners to be considered the owners of the shares of the Fund.","page_number":80,"box":{"x":116,"y":257,"width":491,"height":10}},{"id":"a6641db3-cacb-49dd-803f-a907beea32c0","block_type":"box","text":"Tax Treatment to Insurance Companies","page_number":80,"box":{"x":117,"y":280,"width":289,"height":12}},{"id":"7b6318bf-ef77-4345-bc6a-57a3f978e29f","block_type":"box","text":"Dividends paid by a Fund may be included in the respective Insurance Company’s gross income. The tax","page_number":80,"box":{"x":116,"y":302,"width":725,"height":13}},{"id":"1b4924b0-0423-4495-8cd2-7f850ee90c18","block_type":"box","text":"treatment of these dividends depends on the Insurance","page_number":80,"box":{"x":116,"y":318,"width":376,"height":12}},{"id":"92cc3763-d22d-4c0f-9529-c1cb449c0001","block_type":"box","text":"Company’s tax status. A description of an Insurance","page_number":80,"box":{"x":497,"y":318,"width":363,"height":12}},{"id":"ba370d33-d4ae-4336-a050-0690db302f58","block_type":"box","text":"Company’s tax status is contained in the prospectus for the Contract.","page_number":80,"box":{"x":117,"y":333,"width":479,"height":13}},{"id":"55103229-3d5c-4097-b740-70c8d4b4eb90","block_type":"box","text":"Dividends and interest received by a Fund and capital gains recognized by a Fund may give rise to withholding","page_number":80,"box":{"x":116,"y":356,"width":748,"height":13}},{"id":"7f5e8538-a7e6-41d8-a503-a07644d4510b","block_type":"box","text":"and other taxes imposed by foreign countries. Tax conventions between certain countries and the United States","page_number":80,"box":{"x":116,"y":371,"width":752,"height":13}},{"id":"3fa0b668-d5ff-437d-8060-20df21351e99","block_type":"box","text":"may reduce or eliminate such taxes. As a shareholder in a Fund, an Insurance Company may be able to claim a","page_number":80,"box":{"x":116,"y":387,"width":752,"height":13}},{"id":"7d9da23f-ab17-4b60-b744-a7b1108e0780","block_type":"box","text":"credit or take a deduction for foreign taxes paid by the Fund if certain requirements are met.","page_number":80,"box":{"x":116,"y":402,"width":624,"height":13}},{"id":"2908cb10-40ef-4a85-b569-f74534ef6c4a","block_type":"box","text":"This section summarizes some of the consequences under current federal tax law of an investment in a Fund.","page_number":80,"box":{"x":116,"y":425,"width":753,"height":13}},{"id":"6a60d748-7cf6-400b-b0dd-39e1ac58c971","block_type":"box","text":"It is not a substitute for individualized tax advice. Consult your tax adviser about the potential tax","page_number":80,"box":{"x":116,"y":441,"width":682,"height":12}},{"id":"bda3472c-de2b-4514-9a8d-3dd75d9e5bc1","block_type":"box","text":"consequences of an investment in a Fund under all applicable tax laws.","page_number":80,"box":{"x":116,"y":456,"width":490,"height":13}},{"id":"9fe203f6-42de-420d-b611-939a7ed17089","block_type":"box","text":"X. Additional Information","page_number":80,"box":{"x":116,"y":479,"width":237,"height":10}},{"id":"214c9b04-2fa4-46e2-a206-fad230719150","block_type":"box","text":"Organization of the Company","page_number":80,"box":{"x":137,"y":504,"width":218,"height":13}},{"id":"605714cb-1884-4550-88b1-e781cc00b426","block_type":"box","text":"The Company was incorporated under the laws of the State of Maryland on October 16, 1981, and the","page_number":80,"box":{"x":116,"y":529,"width":719,"height":13}},{"id":"74f65593-0324-45b5-8c33-a41a80608c4d","block_type":"box","text":"Company commenced operations on July 1, 1993.","page_number":80,"box":{"x":117,"y":545,"width":348,"height":12}},{"id":"394e99e9-ae5a-4097-932e-35a10dcf1305","block_type":"box","text":"Effective September 29, 2006, the Company changed its name from FAM Variable Series Funds, Inc. to","page_number":80,"box":{"x":116,"y":567,"width":702,"height":13}},{"id":"4c276780-dbe0-4986-92ab-9214e300e2b1","block_type":"box","text":"BlackRock Variable Series Funds, Inc. The authorized","page_number":80,"box":{"x":116,"y":583,"width":365,"height":12}},{"id":"9c314df5-cdcd-47c4-b07d-db4762d37ff1","block_type":"box","text":"capital stock of the Company consists of 5,500,000,000","page_number":80,"box":{"x":485,"y":583,"width":380,"height":13}},{"id":"60ed1f7c-a4aa-46c5-8b19-59ce05114688","block_type":"box","text":"shares of Class I Common Stock, 700,000,000 shares of Class II Common Stock and 2,430,000,000 shares of","page_number":80,"box":{"x":116,"y":598,"width":747,"height":13}},{"id":"bd664b6b-ec6c-4b99-b90a-55435c1711af","block_type":"box","text":"Class III Common Stock, par value $0.10 per share, and 5","page_number":80,"box":{"x":117,"y":614,"width":393,"height":13}},{"id":"edab82fe-4fb5-446e-8c11-fe163d7a2734","block_type":"box","text":",680,000,000 shares not designated or classified as to","page_number":80,"box":{"x":511,"y":614,"width":361,"height":13}},{"id":"adb01ac1-41d4-4ca2-beaa-86f00eec19f9","block_type":"box","text":"any class or series. The shares of Class I, Class II and Class III Common Stock are divided into fifteen classes","page_number":80,"box":{"x":116,"y":629,"width":732,"height":13}},{"id":"1dede9e5-71e1-4d9e-bd75-e1c9afe50090","block_type":"box","text":"designated as BlackRock 60/40 Target Allocation ETF V.I. Fund Common Stock (no Class II Shares), BlackRock","page_number":80,"box":{"x":116,"y":645,"width":766,"height":13}},{"id":"7d626417-46af-4f2b-9c95-d3d798a85afb","block_type":"box","text":"Advantage Large Cap Core V.I. Fund Common Stock, BlackRock Advantage Large Cap Value V.I. Fund","page_number":80,"box":{"x":116,"y":660,"width":714,"height":13}},{"id":"27fb73a3-a1ca-4d48-ac2a-fa5280f3f863","block_type":"box","text":"Common Stock, BlackRock Advantage SMID Cap V.I. Fund Common Stock, BlackRock Basic Value V.I. Fund","page_number":80,"box":{"x":117,"y":676,"width":759,"height":13}},{"id":"eb40d744-a688-4c96-b9ed-84f8d87aa809","block_type":"box","text":"Common Stock, BlackRock Capital Appreciation V.I. Fund Common Stock (no Class II Shares), BlackRock","page_number":80,"box":{"x":117,"y":691,"width":732,"height":13}},{"id":"127325e7-d8b2-4732-9022-d0dd8d41402b","block_type":"box","text":"Equity Dividend V.I. Fund Common Stock (no Class II Shares), BlackRock Global Allocation V.I. Fund","page_number":80,"box":{"x":116,"y":707,"width":703,"height":13}},{"id":"a690a014-6831-4232-921e-90be131c526d","block_type":"box","text":"Common Stock, BlackRock Government Money Market V.I. Fund Common Stock (no Class II or Class III","page_number":80,"box":{"x":117,"y":722,"width":727,"height":13}},{"id":"ba761fdd-c095-4cbd-9244-e2663b04501c","block_type":"box","text":"Shares), BlackRock International Index V.I. Fund Common Stock (no Class II Shares), BlackRock International","page_number":80,"box":{"x":116,"y":738,"width":755,"height":12}},{"id":"68707816-c4b9-4244-a072-e65d9f01192c","block_type":"box","text":"V.I. Fund Common Stock (no Class II or Class III Shares), BlackRock Large Cap Focus Growth V.I. Fund","page_number":80,"box":{"x":116,"y":753,"width":718,"height":13}},{"id":"8fad5069-4422-4c51-9aed-735a851ffd28","block_type":"box","text":"Common Stock (no Class II Shares), BlackRock Managed Volatility V.I. Fund Common Stock (no Class II","page_number":80,"box":{"x":117,"y":769,"width":721,"height":13}},{"id":"a7e72ae0-18b1-4d3d-869d-b6757ae3b343","block_type":"box","text":"Shares), BlackRock S&P 500 Index V.I. Fund Common Stock and BlackRock Small Cap Index V.I. Fund","page_number":80,"box":{"x":116,"y":784,"width":715,"height":13}},{"id":"eebd874e-7f50-4361-bc29-39557133b05e","block_type":"box","text":"Common Stock (no Class II Shares), respectively. The Company may, from time to time, at the sole discretion of","page_number":80,"box":{"x":117,"y":800,"width":761,"height":13}},{"id":"776d3333-a963-411f-a61a-78a4b5db64a4","block_type":"box","text":"its Board of Directors and without the need to obtain the approval of its shareholders or of Contract owners,","page_number":80,"box":{"x":116,"y":815,"width":738,"height":13}},{"id":"862ce05f-4149-4dfa-b76d-361c9937af1d","block_type":"box","text":"offer and sell shares of one or more of such classes.","page_number":80,"box":{"x":116,"y":831,"width":344,"height":10}},{"id":"54d02408-5162-4099-88ab-dd4a9a2a1c07","block_type":"box","text":"On October 29, 2018, BlackRock International Index V.I. Fund and BlackRock Small Cap Index V.I. Fund","page_number":80,"box":{"x":117,"y":854,"width":745,"height":13}},{"id":"429d5691-6ab9-4cc9-9f0c-17471b9f59d8","block_type":"box","text":"acquired all of the assets and assumed certain stated liabilities of International Equity Index Fund and Small","page_number":80,"box":{"x":116,"y":869,"width":747,"height":13}},{"id":"464f8046-d3af-4a28-a2e8-7843406f5a06","block_type":"box","text":"I-62","page_number":80,"box":{"x":485,"y":917,"width":29,"height":9}},{"id":"a44d0e82-c6a6-4c79-b77e-0d85418942bc","block_type":"box","text":"NM1026U-6004382-80/605","page_number":80,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"d64da358-3f28-485f-9dc7-dc9f2324ce4c","block_type":"box","text":"Cap Equity Index Fund, respectively, each a series of State Farm Variable Product Trust, through the","page_number":81,"box":{"x":117,"y":79,"width":698,"height":13}},{"id":"423ff8bc-e0a6-4377-baf9-2c87047e8575","block_type":"box","text":"Reorganizations. As a result of the Reorganizations, each Fund adopted the performance and financial history","page_number":81,"box":{"x":116,"y":94,"width":763,"height":13}},{"id":"799e1420-58bc-4645-81bc-0c98923ba692","block_type":"box","text":"of its respective Predecessor Fund. The Reorganizations resulted in the Predecessor Funds effectively becoming","page_number":81,"box":{"x":116,"y":110,"width":764,"height":13}},{"id":"360ac1dd-a81a-4d79-81e6-bd92e7494505","block_type":"box","text":"series of the Company.","page_number":81,"box":{"x":116,"y":125,"width":158,"height":13}},{"id":"f4e67df8-1c55-4b4d-8136-8e6816d9f8f1","block_type":"box","text":"All shares of Common Stock have equal voting rights, except that only shares of the respective classes are","page_number":81,"box":{"x":116,"y":149,"width":730,"height":12}},{"id":"b07d25c5-7ac3-4fbf-b385-77641abdc5ad","block_type":"box","text":"entitled to vote on matters concerning only that class. Pursuant to the Investment Company Act and the rules","page_number":81,"box":{"x":116,"y":164,"width":757,"height":13}},{"id":"f4bf43d8-b623-4f92-a617-900cee271d91","block_type":"box","text":"and regulations thereunder, certain matters approved by a vote of all shareholders of the Company may not","page_number":81,"box":{"x":116,"y":180,"width":748,"height":12}},{"id":"6ae3da1f-1540-456f-9d96-0bcfc5373a9e","block_type":"box","text":"be binding on a class whose shareholders have not approved such matter. Each issued and outstanding share","page_number":81,"box":{"x":116,"y":195,"width":753,"height":13}},{"id":"813d1f85-d6e5-44f3-a3e9-d7ec9a9e595b","block_type":"box","text":"of a class is entitled to one vote and to participate equally in dividends and distributions declared with respect","page_number":81,"box":{"x":116,"y":211,"width":760,"height":12}},{"id":"7165e1cf-24ac-4130-aabd-d707d079574c","block_type":"box","text":"to such class and in net assets of such class upon liquidation or dissolution remaining after satisfaction of","page_number":81,"box":{"x":116,"y":226,"width":728,"height":13}},{"id":"669e321c-eba4-4e0e-bb6c-26c6d9fc8cfc","block_type":"box","text":"outstanding liabilities. 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Additional","page_number":87,"box":{"x":116,"y":824,"width":754,"height":13}},{"id":"f707fa57-e86b-45b8-9383-d775c65d65ee","block_type":"box","text":"copies of each Fund’s annual and semi-annual reports to shareholders and each Fund’s Annual and","page_number":87,"box":{"x":116,"y":839,"width":687,"height":13}},{"id":"e5a8bf88-8045-4834-8e85-a3d10231f64b","block_type":"box","text":"Semi-Annual Financial Statements and Additional Info","page_number":87,"box":{"x":116,"y":854,"width":371,"height":10}},{"id":"9fb1ebb1-2a5d-4af6-be14-81473a1b3524","block_type":"box","text":"formation may be obtained at no charge by telephoning","page_number":87,"box":{"x":487,"y":854,"width":381,"height":13}},{"id":"0487facf-593a-4ea1-bdd5-aaf923bbc630","block_type":"box","text":"the Distributor at the telephone number appearing on the front page of this SAI.","page_number":87,"box":{"x":116,"y":869,"width":555,"height":13}},{"id":"646e50d1-a1c2-47a5-ac27-66729f09a5c8","block_type":"box","text":"I-69","page_number":87,"box":{"x":485,"y":917,"width":28,"height":9}},{"id":"568adc8f-5769-457f-a008-26a4f5315a93","block_type":"box","text":"NM1026U-6004382-87/605","page_number":87,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"c9d0b727-003b-432c-a610-2f20d358be15","block_type":"box","text":"PART II","page_number":88,"box":{"x":432,"y":92,"width":149,"height":22}},{"id":"e6c917ca-ba8f-4140-bd12-3da8dee5583a","block_type":"box","text":"Throughout this Statement of Additional Information (“SAI”), each BlackRock-advised fund may be","page_number":88,"box":{"x":116,"y":136,"width":734,"height":12}},{"id":"80a2e013-7eb9-4bbd-83e8-13c4723998a3","block_type":"box","text":"referred to as a “Fund” or collectively with others as the “Funds.” Certain Funds may also be referred to","page_number":88,"box":{"x":117,"y":152,"width":770,"height":12}},{"id":"9d3aa75e-2387-4b04-9acb-f1d78cb32d39","block_type":"box","text":"as “Municipal Funds” if they invest certain of their assets in municipal investments described below.","page_number":88,"box":{"x":116,"y":167,"width":743,"height":12}},{"id":"0363d93e-b98b-4c73-9cab-9d02a2d6a108","block_type":"box","text":"Each Fund is organized either as a Maryland corporati","page_number":88,"box":{"x":117,"y":193,"width":393,"height":12}},{"id":"c3dbb316-45f8-4169-8319-6bdd1dba6988","block_type":"box","text":"on, a Massachusetts business trust or a Delaware","page_number":88,"box":{"x":511,"y":193,"width":369,"height":11}},{"id":"77bf9bf0-ad19-42e2-b26c-006ee0bfe8ac","block_type":"box","text":"statutory trust. In each jurisdiction, nomenclature vari","page_number":88,"box":{"x":116,"y":208,"width":384,"height":12}},{"id":"27ff9c31-2f76-43d9-9ec0-2b5eeb87ed8b","block_type":"box","text":"es. For ease and clarity of presentation, shares of","page_number":88,"box":{"x":501,"y":208,"width":365,"height":12}},{"id":"7717ebe9-889d-49d5-a65c-4fa1514e3169","block_type":"box","text":"common stock and shares of beneficial interest are re","page_number":88,"box":{"x":116,"y":224,"width":390,"height":9}},{"id":"ea5bb106-f4e0-4cf2-aae6-78eb223e9e18","block_type":"box","text":"ferred to herein as “shares” or “Common Stock,”","page_number":88,"box":{"x":507,"y":224,"width":355,"height":11}},{"id":"7fe76bda-3e37-4c57-ac58-19c39d825ff0","block_type":"box","text":"holders of shares of Common Stock are referred to","page_number":88,"box":{"x":117,"y":239,"width":374,"height":10}},{"id":"ad4236ec-c465-48c3-ac68-aa1d9e718e9c","block_type":"box","text":"as “shareholders,” the trustees or directors of each","page_number":88,"box":{"x":492,"y":239,"width":372,"height":12}},{"id":"5ee7e5a1-4931-4f7d-93a0-ea56f03e0e6c","block_type":"box","text":"Fund are referred to as “Directors,” the boards of tru","page_number":88,"box":{"x":117,"y":255,"width":376,"height":11}},{"id":"63ad0fb5-b6be-4d8d-8d47-e0df5e15dcfc","block_type":"box","text":"stees/directors of each Fund are referred to as the","page_number":88,"box":{"x":495,"y":255,"width":370,"height":10}},{"id":"4189f66a-dbef-4095-b35a-e57622cb5464","block_type":"box","text":"“Board of Directors” or the “Board,” BlackRock A","page_number":88,"box":{"x":116,"y":270,"width":341,"height":12}},{"id":"6175e3c3-ae32-41fb-80cd-61f99c4705f1","block_type":"box","text":"Advisors, LLC, BlackRock Fund Advisors or their","page_number":88,"box":{"x":457,"y":270,"width":360,"height":12}},{"id":"e88b921a-26cb-426f-9d1e-03dc8beb6eb5","block_type":"box","text":"respective affiliates is the investment adviser or","page_number":88,"box":{"x":117,"y":286,"width":343,"height":12}},{"id":"e4e839d7-52b6-45b5-ae7c-32d05a0c7319","block_type":"box","text":"r manager of each Fund and is referred to herein as the","page_number":88,"box":{"x":460,"y":286,"width":404,"height":12}},{"id":"4b98ca39-ec52-493d-bd2d-3e2baa05d21b","block_type":"box","text":"“Manager” or “BlackRock,” and the investment","page_number":88,"box":{"x":116,"y":301,"width":337,"height":12}},{"id":"f91fe03e-c6f0-4bb9-af84-09d9c76c922a","block_type":"box","text":"advisory agreement or","page_number":88,"box":{"x":453,"y":301,"width":169,"height":12}},{"id":"4bae542e-92b4-4e81-8b56-ecd0835ba71c","block_type":"box","text":"r management agreement","page_number":88,"box":{"x":621,"y":302,"width":190,"height":11}},{"id":"aec33cd0-be31-4065-a970-ea2c5da53a75","block_type":"box","text":"applicable to each Fund is referred to as the “Management Agreement.” Each Fund’s Articles of","page_number":88,"box":{"x":116,"y":317,"width":700,"height":12}},{"id":"4d8da8b9-8dc1-48a8-a7c2-8db6393c234f","block_type":"box","text":"Incorporation or Declaration of Tr","page_number":88,"box":{"x":117,"y":332,"width":240,"height":12}},{"id":"982fa064-6e40-49de-aacd-4afb87712bfe","block_type":"box","text":"ust, together with all amendments thereto,","page_number":88,"box":{"x":358,"y":332,"width":304,"height":12}},{"id":"1cf9caf9-9416-4c77-bf43-9811d02ef931","block_type":"box","text":"is referred to as its “charter.”","page_number":88,"box":{"x":664,"y":332,"width":215,"height":10}},{"id":"c66e8578-c2b5-450d-bd24-2621c388ca87","block_type":"box","text":"The Investment Company Act of 1940, as amended, is","page_number":88,"box":{"x":116,"y":348,"width":402,"height":12}},{"id":"e85bb0b3-2c39-47a0-92d7-9fa5ae4033c0","block_type":"box","text":"referred to herein as the “Investment Company","page_number":88,"box":{"x":519,"y":348,"width":345,"height":12}},{"id":"a7ec2faf-375a-4ff3-a9b4-6e47873b1639","block_type":"box","text":"Act.” The Securities Act of 1933, as amended, is referred to herein as the “Securities Act.” The Securities","page_number":88,"box":{"x":116,"y":363,"width":767,"height":12}},{"id":"09fe608c-035a-480c-b6f4-327da24a2a36","block_type":"box","text":"and Exchange Commission is referred to herein as the “Commission” or the “SEC.”","page_number":88,"box":{"x":116,"y":379,"width":609,"height":12}},{"id":"33d48859-8754-4b90-b0ca-21c6cc3c180b","block_type":"box","text":"Certain Funds are “feeder” funds (each, a “Feeder Fund”) that invest all or a portion of their assets in a","page_number":88,"box":{"x":117,"y":405,"width":765,"height":12}},{"id":"e302f60c-7a5a-4bae-836a-c70ad47f149b","block_type":"box","text":"corresponding “master” portfolio (each, a “Master Portfolio”) of a master limited liability company (each,","page_number":88,"box":{"x":116,"y":420,"width":770,"height":12}},{"id":"b6cd2900-56e7-40c2-bb89-2ea82bb40100","block_type":"box","text":"a “Master LLC”), a mutual fund that has the same objective and strategies as the Feeder Fund. All","page_number":88,"box":{"x":116,"y":436,"width":734,"height":12}},{"id":"4058ecc5-b820-411b-8653-90e0dd70aac5","block_type":"box","text":"investments are generally made at the level of the Master Portfolio. This structure is sometimes called","page_number":88,"box":{"x":117,"y":451,"width":761,"height":12}},{"id":"1e0959d9-f8de-49f3-ba5c-0e4f87caaccd","block_type":"box","text":"a “master/feeder” structure. A Feeder Fund’s investment results will correspond directly to the","page_number":88,"box":{"x":116,"y":467,"width":700,"height":12}},{"id":"c75ce836-84f7-4936-ba4b-c40471700b93","block_type":"box","text":"investment results of the underlying Master Portfolio in which it invests. For simplicity, this SAI uses the","page_number":88,"box":{"x":117,"y":482,"width":770,"height":12}},{"id":"5da75545-ac55-472c-83ce-a7d28c47b9da","block_type":"box","text":"term “Fund” to include both a Feeder Fund and its Master Portfolio.","page_number":88,"box":{"x":116,"y":498,"width":503,"height":9}},{"id":"841053a0-2234-44bb-8c2c-6c0be0cdb605","block_type":"box","text":"In addition to containing information about the Funds, Part II of this SAI contains general information","page_number":88,"box":{"x":117,"y":523,"width":747,"height":13}},{"id":"fa172bec-0d69-4fb3-bee8-09e3e67a6b9f","block_type":"box","text":"about all funds in the BlackRock-advised fund complex. Certain information contained herein may not","page_number":88,"box":{"x":116,"y":539,"width":757,"height":12}},{"id":"5ed6e83a-9129-4878-a5cf-ee801b5827ee","block_type":"box","text":"be relevant to a particular Fund.","page_number":88,"box":{"x":117,"y":555,"width":241,"height":11}},{"id":"8649040e-6d69-41da-a38c-706d09bfe68e","block_type":"box","text":"Investment Risks and Considerations","page_number":88,"box":{"x":119,"y":595,"width":675,"height":23}},{"id":"00d5f419-b566-498d-b2c5-274cfe0be530","block_type":"box","text":"Set forth below are descriptions of some of the types of investments and investment strategies that one","page_number":88,"box":{"x":116,"y":634,"width":772,"height":13}},{"id":"00051448-a0cb-471f-8265-a06fdb9b5e3e","block_type":"box","text":"or more of the Funds may use, and the risks and considerations associated with those investments","page_number":88,"box":{"x":116,"y":650,"width":740,"height":12}},{"id":"6a1043fb-dc48-4adc-a5fa-4472b2465629","block_type":"box","text":"and investment strategies. Please see each Fund’s prospectuses (the “Prospectus”) and the","page_number":88,"box":{"x":116,"y":665,"width":685,"height":13}},{"id":"7307e4b7-9e76-4a37-971f-27ca3cd45fda","block_type":"box","text":"“Investment Objective and Policies,” “Investment Objectives and Policies” or “Investment Strategies","page_number":88,"box":{"x":116,"y":681,"width":737,"height":12}},{"id":"dfa54f8a-a396-4e8b-b63f-037bcc10e760","block_type":"box","text":"and Risks of the Fund” section, as applicable, of Part I of this SAI for further information on each","page_number":88,"box":{"x":116,"y":696,"width":714,"height":12}},{"id":"92214534-fcea-43a7-87b8-1dd9152a9184","block_type":"box","text":"Fund’s investment policies and risks. Information contained in this section about the risks and","page_number":88,"box":{"x":117,"y":712,"width":692,"height":12}},{"id":"020942b7-00eb-4925-b3bd-cfb3e24c26da","block_type":"box","text":"considerations associated with a Fund’s investments and/or investment strategies applies only to those","page_number":88,"box":{"x":116,"y":728,"width":765,"height":12}},{"id":"007252a7-ed4a-4f9b-8bd0-d6f8cecb9ed1","block_type":"box","text":"Funds specifically identified in Part I of this SAI as making each type of investment or using each","page_number":88,"box":{"x":117,"y":743,"width":716,"height":12}},{"id":"67c84e96-0a6a-4b26-967d-3eb32538a203","block_type":"box","text":"investment strategy (each, a “Covered Fund”). Information that does not apply to a Covered Fund does","page_number":88,"box":{"x":117,"y":758,"width":764,"height":13}},{"id":"0906f959-2205-4173-8e35-cd9abfa9ed44","block_type":"box","text":"not form a part of that Covered Fund’s SAI and should not be relied on by investors in that Covered","page_number":88,"box":{"x":117,"y":774,"width":735,"height":12}},{"id":"50ac2c27-b646-4a9f-944c-8458296c2cd8","block_type":"box","text":"Fund. Only information that is clearly identified as applicable to a Covered Fund is considered to form a","page_number":88,"box":{"x":117,"y":789,"width":765,"height":13}},{"id":"afa60b17-b156-4f90-b30f-31c739066204","block_type":"box","text":"part of that Covered Fund’s SAI.","page_number":88,"box":{"x":117,"y":805,"width":238,"height":12}},{"id":"52d20b92-1326-40bc-913b-0edf5fbb7480","block_type":"box","text":"Asset-Backed Securities.","page_number":88,"box":{"x":116,"y":831,"width":200,"height":9}},{"id":"2eb2e92b-f34c-48be-9387-6aa1c310baad","block_type":"box","text":"Asset-backed securities are securities backed by home equity loans,","page_number":88,"box":{"x":317,"y":831,"width":519,"height":12}},{"id":"e4fd9d5a-536b-4af5-bf6c-607527e37c0c","block_type":"box","text":"installment sale contracts, credit card receivables or other assets. Asset-backed securities are “pass","page_number":88,"box":{"x":117,"y":846,"width":749,"height":12}},{"id":"97872c7a-b65f-491a-98c8-39fdac20fe3c","block_type":"box","text":"through” securities, meaning that principal and interest payments — net of expenses — made by the","page_number":88,"box":{"x":116,"y":862,"width":751,"height":12}},{"id":"1dccee03-b802-41b1-a64a-8bbe88a01682","block_type":"box","text":"borrower on the underlying assets (such as credit card receivables) are passed through to a Fund. The","page_number":88,"box":{"x":117,"y":877,"width":768,"height":12}},{"id":"146640ba-9b67-4389-9558-ec86829e822d","block_type":"box","text":"II-1","page_number":88,"box":{"x":489,"y":909,"width":20,"height":9}},{"id":"a0732f94-7fee-4672-99e2-8a2052e0fe58","block_type":"box","text":"NM1026U-6004382-88/605","page_number":88,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"31c9bd2d-c5b7-423d-8d42-aaf35ef97208","block_type":"box","text":"value of asset-backed securities, like that of traditional fixed-income securities, typically increases","page_number":89,"box":{"x":116,"y":87,"width":729,"height":12}},{"id":"ce44616b-4372-4a1d-abd2-0f81ab7de9bc","block_type":"box","text":"when interest rates fall and decreases when interest rates rise. However, asset-backed securities differ","page_number":89,"box":{"x":116,"y":102,"width":770,"height":12}},{"id":"2d70464e-b210-4733-95fc-fe60191d51fe","block_type":"box","text":"from traditional fixed-income securities because of their potential for prepayment. The price paid by a","page_number":89,"box":{"x":116,"y":118,"width":755,"height":12}},{"id":"672038f7-7512-44cb-9f88-75a8534ee00e","block_type":"box","text":"Fund for its asset-backed securities, the yield the Fund expects to receive from such securities and the","page_number":89,"box":{"x":117,"y":134,"width":767,"height":12}},{"id":"18034eba-a144-4242-b53e-6281ba08b74e","block_type":"box","text":"average life of the securities are based on a number of factors, including the anticipated rate of","page_number":89,"box":{"x":116,"y":149,"width":709,"height":12}},{"id":"23ec8e10-cfbf-4f1a-9057-8972bddbca7f","block_type":"box","text":"prepayment of the underlying assets. In a period of declining interest rates, borrowers may prepay the","page_number":89,"box":{"x":117,"y":165,"width":761,"height":12}},{"id":"707ac122-3326-404b-9647-08543914dbeb","block_type":"box","text":"underlying assets more quickly than anticipated, thereby reducing the yield to maturity and the average","page_number":89,"box":{"x":117,"y":180,"width":769,"height":12}},{"id":"323294f3-4069-4bfc-a759-f50a8318e2e8","block_type":"box","text":"life of the asset-backed securities. Moreover, when a Fund reinvests the proceeds of a prepayment in","page_number":89,"box":{"x":117,"y":196,"width":758,"height":12}},{"id":"d791a308-4d43-41d9-86b1-5ea034cee1ca","block_type":"box","text":"these circumstances, it will likely receive a rate of interest that is lower than the rate on the security that","page_number":89,"box":{"x":116,"y":211,"width":772,"height":12}},{"id":"74549182-4b27-465e-843d-453ab87f78ff","block_type":"box","text":"was prepaid. To the extent that a Fund purchases asset-backed securities at a premium, prepayments","page_number":89,"box":{"x":116,"y":227,"width":765,"height":12}},{"id":"625f9aa7-3611-44d9-a497-1ebce74f191f","block_type":"box","text":"may result in a loss to the extent of the premium paid. If a Fund buys such securities at a discount,","page_number":89,"box":{"x":117,"y":242,"width":736,"height":12}},{"id":"0fd6b570-ebea-4535-bf21-54b6cf5fc1e0","block_type":"box","text":"both scheduled payments and unscheduled prepayments will increase current and total returns and","page_number":89,"box":{"x":117,"y":258,"width":742,"height":12}},{"id":"00efc02c-3996-487f-b7dc-e793c7f3ae35","block_type":"box","text":"unscheduled prepayments will also accelerate the recognition of income which, when distributed to","page_number":89,"box":{"x":117,"y":273,"width":738,"height":12}},{"id":"738f0268-c6a6-4664-89f9-212a5945fac4","block_type":"box","text":"shareholders, will be taxable as ordinary income. In a period of rising interest rates, prepayments of the","page_number":89,"box":{"x":116,"y":289,"width":772,"height":12}},{"id":"7c53dafe-4d4a-43a1-a52b-3db66696e8e3","block_type":"box","text":"underlying assets may occur at a slower than expected rate, creating maturity extension risk. This","page_number":89,"box":{"x":117,"y":304,"width":730,"height":12}},{"id":"fc069a98-ee29-4421-8ba4-b9540ef0cb9a","block_type":"box","text":"particular risk may effectively change a security that was considered short- or intermediate-term at the","page_number":89,"box":{"x":117,"y":320,"width":762,"height":12}},{"id":"c6554c63-6835-42cd-b168-1e3f1f555bc7","block_type":"box","text":"time of purchase into a longer term security. Since the value of longer-term securities generally","page_number":89,"box":{"x":116,"y":335,"width":710,"height":12}},{"id":"886c624b-ced2-4f2b-a86b-fded3601fd4f","block_type":"box","text":"fluctuates more widely in response to changes in interest rates than does the value of shorter-term","page_number":89,"box":{"x":116,"y":351,"width":736,"height":12}},{"id":"1f6de049-2c8b-472b-860a-d841b405ac0c","block_type":"box","text":"securities, maturity extension risk could increase the volatility of the Fund. When interest rates decline,","page_number":89,"box":{"x":116,"y":366,"width":766,"height":12}},{"id":"008ac7a7-18f9-4232-9378-081d3f64ed1c","block_type":"box","text":"the value of an asset-backed security with prepayment features may not increase as much as that of","page_number":89,"box":{"x":116,"y":382,"width":751,"height":12}},{"id":"a767c348-6f99-44b9-ac13-315a786b5367","block_type":"box","text":"other fixed-income securities, and, as noted above, changes in market rates of interest may accelerate","page_number":89,"box":{"x":116,"y":397,"width":767,"height":12}},{"id":"fdb4bfd7-3e81-4ffb-b6ce-783b1dc8c7f7","block_type":"box","text":"or retard prepayments and thus affect maturities.","page_number":89,"box":{"x":116,"y":413,"width":368,"height":12}},{"id":"dd416742-f1f0-4404-9834-7e504cb47ee3","block_type":"box","text":"Asset-Based Securities.","page_number":89,"box":{"x":116,"y":444,"width":190,"height":9}},{"id":"dd23c5ef-e7d6-49d5-9e74-75adb13bf813","block_type":"box","text":"Certain Funds may invest in debt, preferred or convertible securities, the","page_number":89,"box":{"x":307,"y":444,"width":548,"height":12}},{"id":"03774d41-bf41-4156-a2d0-3d50412f0ac8","block_type":"box","text":"principal amount, redemption terms or conversion terms of which are related to the market price of","page_number":89,"box":{"x":117,"y":459,"width":734,"height":12}},{"id":"483117bf-7349-43bb-9b58-199f8e9ceb39","block_type":"box","text":"some natural resource asset such as gold bullion. These securities are referred to as “asset-based","page_number":89,"box":{"x":116,"y":475,"width":737,"height":12}},{"id":"55e31a93-e4f3-449d-a1c9-27822f9c4fd2","block_type":"box","text":"securities.” A Fund will purchase only asset-based securities that are rated, or are issued by issuers","page_number":89,"box":{"x":116,"y":490,"width":746,"height":12}},{"id":"6e4d37ee-32a3-495d-8ae6-5af8b0abe873","block_type":"box","text":"that have outstanding debt obligations rated, investment grade (for example, AAA, AA, A or BBB by","page_number":89,"box":{"x":116,"y":506,"width":744,"height":12}},{"id":"4c3b8c9c-1561-49e4-a7d6-3bf975344edc","block_type":"box","text":"S&P Global Ratings (“S&P”) or Fitch Ratings (“Fitch”), or Baa by Moody’s Investors Service, Inc.","page_number":89,"box":{"x":116,"y":521,"width":719,"height":12}},{"id":"8fdca286-f0a2-4a0a-a823-cc4832fc835b","block_type":"box","text":"(“Moody’s”) or commercial paper rated A-1 by S&P or Prime-1 by Moody’s) or by issuers that the","page_number":89,"box":{"x":117,"y":537,"width":721,"height":12}},{"id":"f284a287-39ec-4ebd-ba97-555f935490a5","block_type":"box","text":"Manager has determined to be of similar creditworthiness. Obligations ranked in the fourth highest","page_number":89,"box":{"x":117,"y":552,"width":733,"height":12}},{"id":"f9e8e5b3-36f0-477b-8e5e-b8502a05c967","block_type":"box","text":"rating category, while considered “investment grade,” may have certain speculative characteristics and","page_number":89,"box":{"x":117,"y":568,"width":766,"height":12}},{"id":"74528318-b7c3-4e91-8a3c-a11a8b2f30aa","block_type":"box","text":"may be more likely to be downgraded than securities rated in the three highest rating categories. If an","page_number":89,"box":{"x":117,"y":583,"width":759,"height":12}},{"id":"1afaf599-c67e-445b-a174-00e4e31fc09b","block_type":"box","text":"asset-based security is backed by a bank letter of credit or other similar facility, the Manager may take","page_number":89,"box":{"x":116,"y":599,"width":764,"height":12}},{"id":"62e98e45-7d6a-4fe0-bbe9-c0698fd733d6","block_type":"box","text":"such backing into account in determining the creditworthiness of the issuer. While the market prices for","page_number":89,"box":{"x":116,"y":614,"width":769,"height":12}},{"id":"087249d7-2fd6-4d09-a30d-6dab7e9d97e6","block_type":"box","text":"an asset-based security and the related natural resource asset generally are expected to move in the","page_number":89,"box":{"x":116,"y":630,"width":756,"height":12}},{"id":"c713a268-a0a4-4976-bb0d-1cd819874dae","block_type":"box","text":"same direction, there may not be perfect correlation in the two price movements. Asset-based","page_number":89,"box":{"x":116,"y":645,"width":702,"height":12}},{"id":"d3d778a0-8d0d-4bb2-b0ba-7f3cdcb2b14f","block_type":"box","text":"securities may not be secured by a security interest in or claim on the underlying natural resource","page_number":89,"box":{"x":116,"y":661,"width":723,"height":12}},{"id":"2fd47760-d4b8-4734-bdb6-32ba587f8fa6","block_type":"box","text":"asset. The asset-based securities in which a Fund may invest may bear interest or pay preferred","page_number":89,"box":{"x":116,"y":676,"width":716,"height":12}},{"id":"5a0413cb-4621-4251-a485-807fd07bf688","block_type":"box","text":"dividends at below market (or even relatively nominal) rates. Certain asset-based securities may be","page_number":89,"box":{"x":116,"y":692,"width":738,"height":12}},{"id":"e4a5127a-92b4-4abb-8b11-6e8e637d9938","block_type":"box","text":"payable at maturity in cash at the stated principal amount or, at the option of the holder, directly in a","page_number":89,"box":{"x":117,"y":707,"width":738,"height":12}},{"id":"05a66a86-585b-4640-be73-4760b211e9c7","block_type":"box","text":"stated amount of the asset to which it is related. In such instance, because no Fund presently intends","page_number":89,"box":{"x":116,"y":723,"width":753,"height":12}},{"id":"f8eb30fb-ea20-439b-aa61-93e15dd9a166","block_type":"box","text":"to invest directly in natural resource assets, a Fund would sell the asset-based security in the","page_number":89,"box":{"x":116,"y":738,"width":691,"height":12}},{"id":"38379335-5d59-43a3-a284-4b02ffbc7344","block_type":"box","text":"secondary market, to the extent one exists, prior to maturity if the value of the stated amount of the","page_number":89,"box":{"x":116,"y":754,"width":733,"height":12}},{"id":"7d18e02d-2552-45eb-a127-82849b6d9631","block_type":"box","text":"asset exceeds the stated principal amount and thereby realize the appreciation in the underlying asset.","page_number":89,"box":{"x":116,"y":769,"width":763,"height":12}},{"id":"7d71f9b1-fc47-4dc7-9b0d-8b21e0685c58","block_type":"box","text":"Precious Metal-Related Securities.","page_number":89,"box":{"x":116,"y":800,"width":256,"height":10}},{"id":"488d2b08-0959-4aaf-a9bb-0ea74c557b78","block_type":"box","text":"A Fund may invest in the equity and other securities of companies","page_number":89,"box":{"x":378,"y":800,"width":491,"height":12}},{"id":"769844d9-59d0-4d11-9d20-68b1628e0f7f","block_type":"box","text":"that explore for, extract, process or deal in precious metals (","page_number":89,"box":{"x":116,"y":816,"width":447,"height":12}},{"id":"46e9fd8d-e899-492f-8b12-76d6e650b96a","block_type":"box","text":"e.g.","page_number":89,"box":{"x":564,"y":818,"width":26,"height":10}},{"id":"b2d4af7b-e8b4-4eed-8596-fc0b369756a4","block_type":"box","text":", gold, silver and platinum), and in","page_number":89,"box":{"x":593,"y":816,"width":249,"height":12}},{"id":"d7df161b-f87c-425f-bc1e-d6d975f23273","block_type":"box","text":"asset-based securities indexed to the value of such metals. Such securities may be purchased when","page_number":89,"box":{"x":116,"y":831,"width":752,"height":12}},{"id":"b0bd7c40-cd8a-4958-84d4-ba68f9e1001e","block_type":"box","text":"they are believed to be attractively priced in relation to the value of a company’s precious metal-related","page_number":89,"box":{"x":116,"y":847,"width":769,"height":12}},{"id":"d09be587-1ce1-4da7-ae22-405dc52290f2","block_type":"box","text":"assets or when the values of precious metals are expected to benefit from inflationary pressure or","page_number":89,"box":{"x":116,"y":862,"width":731,"height":12}},{"id":"5b5005db-8bad-4cdb-8e10-319a9cd482ae","block_type":"box","text":"other economic, political or financial uncertainty or instability. Based on historical experience, during","page_number":89,"box":{"x":116,"y":878,"width":746,"height":12}},{"id":"07f50b9c-bf08-44be-8714-65ccb065cd27","block_type":"box","text":"II-2","page_number":89,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"043beb0f-1283-46b4-8e96-b584fa54b834","block_type":"box","text":"NM1026U-6004382-89/605","page_number":89,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"9a39cfb9-5c83-4bfd-a1ea-b9cb795bfb26","block_type":"box","text":"periods of economic or financial instability the securities of companies involved in precious metals may","page_number":90,"box":{"x":117,"y":87,"width":766,"height":12}},{"id":"9d5e2310-cca3-4eb1-86cc-77650b6b6aaf","block_type":"box","text":"be subject to extreme price fluctuations, reflecting the high volatility of precious metal prices during","page_number":90,"box":{"x":117,"y":102,"width":736,"height":13}},{"id":"128753e9-692a-4d00-949a-255736b8d3a6","block_type":"box","text":"such periods. In addition, the instability of precious metal prices may result in volatile earnings of","page_number":90,"box":{"x":116,"y":118,"width":721,"height":12}},{"id":"79a860ef-5393-4ab9-b088-dab3b50a8f9c","block_type":"box","text":"precious metal-related companies, which may, in turn, adversely affect the financial condition of such","page_number":90,"box":{"x":117,"y":134,"width":754,"height":12}},{"id":"4b66c1e7-08d6-4f17-8080-bcf7b7047162","block_type":"box","text":"companies. The major producers of gold include the Republic of South Africa, Russia, Canada, the","page_number":90,"box":{"x":116,"y":149,"width":739,"height":12}},{"id":"8d234a08-b3dc-4c71-a5c0-c3ee15d52a5b","block_type":"box","text":"United States, Brazil and Australia. Sales of gold by Russia are largely unpredictable and often relate","page_number":90,"box":{"x":117,"y":165,"width":754,"height":12}},{"id":"ae663fe4-451c-43f5-867d-6a7e44868dd8","block_type":"box","text":"to political and economic considerations rather than to market forces. Economic, financial, social and","page_number":90,"box":{"x":116,"y":180,"width":753,"height":12}},{"id":"f33032d0-727d-4e33-bc45-5b604871332e","block_type":"box","text":"political factors within South Africa may significantly affect South African gold production.","page_number":90,"box":{"x":117,"y":196,"width":663,"height":12}},{"id":"267f1a1f-bc35-47c3-8266-7f2056b41c8e","block_type":"box","text":"Borrowing and Leverage.","page_number":90,"box":{"x":116,"y":227,"width":201,"height":12}},{"id":"bc36bca6-9dfc-48cb-bc93-1a2f6246e235","block_type":"box","text":"Each Fund may borrow as a temporary measure for extraordinary or","page_number":90,"box":{"x":318,"y":227,"width":517,"height":12}},{"id":"84898cc7-98c9-41b0-87bc-4454d277d465","block_type":"box","text":"emergency purposes, including to meet redemptions or to settle securities transactions. Certain Funds","page_number":90,"box":{"x":116,"y":242,"width":765,"height":12}},{"id":"fa872e7a-3fd8-4f03-9a05-fb00b9d7e87a","block_type":"box","text":"will not purchase securities at any time when borrowings exceed 5% of their total assets, except (a) to","page_number":90,"box":{"x":116,"y":258,"width":761,"height":12}},{"id":"e8f7c630-de58-476c-9be5-a59f4a00b713","block_type":"box","text":"honor prior commitments or (b) to exercise subscription rights when outstanding borrowings have been","page_number":90,"box":{"x":117,"y":273,"width":768,"height":12}},{"id":"8a081bb7-cf52-41cc-81de-7eebac53e903","block_type":"box","text":"obtained exclusively for settlements of other securities transactions.","page_number":90,"box":{"x":116,"y":289,"width":508,"height":12}},{"id":"5c6cf225-3001-46ce-86f8-d16a38054534","block_type":"box","text":"Certain Funds may also borrow in order to make investments, to the extent disclosed in such Fund’s","page_number":90,"box":{"x":117,"y":320,"width":740,"height":12}},{"id":"2b230d6f-7e04-4ace-90d2-7d9e82493b80","block_type":"box","text":"Prospectus. The purchase of securities while borrowings are outstanding will have the effect of","page_number":90,"box":{"x":117,"y":335,"width":700,"height":12}},{"id":"d4048370-b6f7-46b9-af2c-696899ee928d","block_type":"box","text":"leveraging the Fund. Such leveraging increases the Fund’s exposure to capital risk, and borrowed funds","page_number":90,"box":{"x":117,"y":351,"width":769,"height":12}},{"id":"f2c187df-fbd3-4676-a332-e660ce5a0e9e","block_type":"box","text":"are subject to interest costs that will reduce net income. The use of leverage by a Fund creates an","page_number":90,"box":{"x":116,"y":366,"width":727,"height":12}},{"id":"1f14a34a-e604-4e01-8197-d54ac859753d","block_type":"box","text":"opportunity for greater total return, but, at the same time, creates special risks. For example, leveraging","page_number":90,"box":{"x":116,"y":382,"width":765,"height":12}},{"id":"c777000c-8d0c-424d-a9f0-3bd91ef9bc8c","block_type":"box","text":"may exaggerate changes in the net asset value (“NAV”) of Fund shares and in the yield on the Fund’s","page_number":90,"box":{"x":117,"y":397,"width":751,"height":12}},{"id":"a112ee73-c10e-4178-b91d-cbd952eaf6ff","block_type":"box","text":"portfolio. Although the principal of such borrowings will be fixed, the Fund’s assets may change in value","page_number":90,"box":{"x":117,"y":413,"width":764,"height":12}},{"id":"2b5662e7-8070-43f3-9f99-19b2e1f8c3c1","block_type":"box","text":"during the time the borrowings are outstanding. Borrowings will create interest expenses for the Fund","page_number":90,"box":{"x":116,"y":428,"width":749,"height":12}},{"id":"66b119d1-8adf-40d7-9782-00e9c3f62176","block_type":"box","text":"that can exceed the income from the assets purchased with the borrowings. To the extent the income or","page_number":90,"box":{"x":116,"y":444,"width":769,"height":12}},{"id":"c23a54e1-a3d7-423b-bd66-83cbfbf2eeb7","block_type":"box","text":"capital appreciation derived from securities purchased with borrowed funds exceeds the interest the","page_number":90,"box":{"x":116,"y":459,"width":738,"height":12}},{"id":"02a5bacc-3ba4-441d-83b2-d5a34c4a90ca","block_type":"box","text":"Fund will have to pay on the borrowings, the Fund’s return will be greater than if leverage had not been","page_number":90,"box":{"x":117,"y":475,"width":761,"height":12}},{"id":"aea0fc6c-737d-46a7-93f2-73d706106085","block_type":"box","text":"used. Conversely, if the income or capital appreciation from the securities purchased with such","page_number":90,"box":{"x":117,"y":490,"width":701,"height":12}},{"id":"8108e622-ad2d-4846-bf12-716799e6d1d3","block_type":"box","text":"borrowed funds is not sufficient to cover the cost of borrowing, the return to the Fund will be less than if","page_number":90,"box":{"x":117,"y":506,"width":761,"height":12}},{"id":"40ebe88c-ec28-4210-975b-94461adc504f","block_type":"box","text":"leverage had not been used and, therefore, the amount available for distribution to shareholders as","page_number":90,"box":{"x":117,"y":521,"width":732,"height":12}},{"id":"b982e718-932c-4d47-9554-ae190798091b","block_type":"box","text":"dividends will be reduced. In the latter case, the Manager in its best judgment nevertheless may","page_number":90,"box":{"x":116,"y":537,"width":709,"height":12}},{"id":"4b123db4-926a-494d-944d-8dcef70a2201","block_type":"box","text":"determine to maintain the Fund’s leveraged position if it expects that the benefits to the Fund’s","page_number":90,"box":{"x":116,"y":552,"width":699,"height":12}},{"id":"6f3afa01-cc75-41db-8c2e-e0ba409dd8af","block_type":"box","text":"shareholders of maintaining the leveraged position will outweigh the current reduced return.","page_number":90,"box":{"x":116,"y":568,"width":677,"height":12}},{"id":"7b028235-2bc4-4fcb-a122-98f8faed0043","block_type":"box","text":"Certain types of borrowings by a Fund may result in the Fund being subject to covenants in credit","page_number":90,"box":{"x":117,"y":599,"width":727,"height":12}},{"id":"d65e8228-db4a-49d3-bb9c-7eb6cc412967","block_type":"box","text":"agreements relating to asset coverage, portfolio composition requirements and other matters. It is not","page_number":90,"box":{"x":116,"y":614,"width":758,"height":12}},{"id":"846f147c-a6ab-499a-8614-ae8f3bffe6ef","block_type":"box","text":"anticipated that observance of such covenants would impede the Manager from managing a Fund’s","page_number":90,"box":{"x":116,"y":630,"width":745,"height":12}},{"id":"310cb07b-740b-4c96-9042-ac756e1cb970","block_type":"box","text":"portfolio in accordance with the Fund’s investment objectives and policies. However, a breach of any","page_number":90,"box":{"x":117,"y":645,"width":751,"height":12}},{"id":"863dc9f5-af86-4308-a168-908d5b32bc73","block_type":"box","text":"such covenants not cured within the specified cure period may result in acceleration of outstanding","page_number":90,"box":{"x":116,"y":661,"width":732,"height":12}},{"id":"fb6c3b30-a9e2-4139-9f70-177e3ff8322e","block_type":"box","text":"indebtedness and require the Fund to dispose of portfolio investments at a time when it may be","page_number":90,"box":{"x":117,"y":676,"width":706,"height":12}},{"id":"12947371-adc9-46f9-a4ea-0162bdd476d0","block_type":"box","text":"disadvantageous to do so.","page_number":90,"box":{"x":116,"y":692,"width":195,"height":12}},{"id":"132b6256-40ad-48c9-87e5-2a4351ea4a30","block_type":"box","text":"Each Fund may at times borrow from affiliates of the Manager, provided that the terms of such","page_number":90,"box":{"x":117,"y":723,"width":699,"height":12}},{"id":"1014f535-07f9-4a7a-970f-1f3c4cd85faa","block_type":"box","text":"borrowings are no less favorable than those available from comparable sources of funds in the","page_number":90,"box":{"x":117,"y":738,"width":701,"height":12}},{"id":"de17031c-f960-40fd-9b34-b204478a6c4e","block_type":"box","text":"marketplace.","page_number":90,"box":{"x":117,"y":754,"width":94,"height":12}},{"id":"ed8dccb1-7e25-45cf-ac90-1163d07d10ce","block_type":"box","text":"Cash Management.","page_number":90,"box":{"x":117,"y":785,"width":151,"height":12}},{"id":"424bd728-1571-4e8a-b04f-0486769df940","block_type":"box","text":"Generally, the Manager will employ futures and options on futures to provide","page_number":90,"box":{"x":275,"y":785,"width":567,"height":12}},{"id":"dd8380b2-0605-40ef-9446-d76fcfeceba7","block_type":"box","text":"liquidity necessary to meet anticipated redemptions or for day-to-day operating purposes. However, if","page_number":90,"box":{"x":117,"y":800,"width":752,"height":12}},{"id":"54e52335-a84e-4e6a-bd1a-1aea040ad6ab","block_type":"box","text":"considered appropriate in the opinion of the Manager, a portion of a Fund’s assets may be invested in","page_number":90,"box":{"x":116,"y":816,"width":755,"height":12}},{"id":"ab3746c4-6c3a-43dc-8f3e-ffe89078ab2a","block_type":"box","text":"certain types of instruments with remaining maturities of 397 days or less for liquidity purposes. Such","page_number":90,"box":{"x":116,"y":831,"width":754,"height":12}},{"id":"b6984223-b1d1-47d0-b7de-ca9e996ef9e4","block_type":"box","text":"instruments would consist of: (i) obligations of the U.S. Government, its agencies, instrumentalities,","page_number":90,"box":{"x":117,"y":847,"width":740,"height":12}},{"id":"9253edd4-b813-4773-b823-bcad6f04665b","block_type":"box","text":"authorities or political subdivisions (“U.S. Government Securities”); (ii) other fixed-income securities","page_number":90,"box":{"x":116,"y":862,"width":742,"height":12}},{"id":"f836e57e-a3d2-47b5-94dc-66a9f67ced14","block_type":"box","text":"rated Aa or higher by Moody’s or AA or higher by S&P or, if unrated, of comparable quality in the","page_number":90,"box":{"x":117,"y":878,"width":721,"height":12}},{"id":"402f03d8-22b6-4196-aeb4-30450eb24420","block_type":"box","text":"II-3","page_number":90,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"1f1566dc-2dd1-4908-9767-73d7bf42201e","block_type":"box","text":"NM1026U-6004382-90/605","page_number":90,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"99a4d292-4bbc-4897-95ef-a7d91ad06097","block_type":"box","text":"opinion of the Manager; (iii) commercial paper; (iv) bank obligations, including negotiable certificates of","page_number":91,"box":{"x":116,"y":87,"width":768,"height":12}},{"id":"405b5fa8-f971-457c-918c-605a84bf9926","block_type":"box","text":"deposit, time deposits and bankers’ acceptances; and (v) repurchase agreements. At the time the","page_number":91,"box":{"x":116,"y":102,"width":730,"height":13}},{"id":"bfbd36de-0c21-4f12-b23f-1f299f027506","block_type":"box","text":"Fund invests in commercial paper, bank obligations or repurchase agreements, the issuer or the","page_number":91,"box":{"x":117,"y":118,"width":718,"height":12}},{"id":"3f8cb4bc-f4bc-4251-8fb6-6c1e6b81033a","block_type":"box","text":"issuer’s parent must have outstanding debt rated Aa or higher by Moody’s or AA or higher by S&P or","page_number":91,"box":{"x":117,"y":134,"width":752,"height":12}},{"id":"c6651c0a-77ad-4aa5-ad35-0d55212432e4","block_type":"box","text":"outstanding commercial paper, bank obligations or other short-term obligations rated Prime-1 by","page_number":91,"box":{"x":116,"y":149,"width":719,"height":12}},{"id":"1b6baece-5ed5-47b5-9db8-a2da5aa74f0f","block_type":"box","text":"Moody’s or A-1 by S&P; or, if no such ratings are available, the instrument must be of comparable","page_number":91,"box":{"x":117,"y":165,"width":731,"height":12}},{"id":"c1a3941b-6b7e-41be-bc68-7b8e2da658ce","block_type":"box","text":"quality in the opinion of the Manager. For more information on money market instruments, see “Money","page_number":91,"box":{"x":116,"y":180,"width":765,"height":12}},{"id":"151413e5-a8bd-4fa3-a536-4b5499d2519f","block_type":"box","text":"Market Securities” below.","page_number":91,"box":{"x":117,"y":196,"width":192,"height":9}},{"id":"4f89f52d-8fb9-47cc-ab60-7a348d6b8d12","block_type":"box","text":"Collateralized Debt Obligations.","page_number":91,"box":{"x":117,"y":227,"width":251,"height":12}},{"id":"984e19c0-d77c-405f-bc47-ec386ed6d1fb","block_type":"box","text":"Certain Funds may invest in collateralized debt obligations","page_number":91,"box":{"x":369,"y":227,"width":444,"height":12}},{"id":"aae8d97f-c02d-4d5a-af7b-94aee72e8e2d","block_type":"box","text":"(“CDOs”), which include collateralized bond obligations (“CBOs”), collateralized loan obligations","page_number":91,"box":{"x":117,"y":242,"width":713,"height":12}},{"id":"6fcc73d3-f73d-4e9e-bee7-2b673205585b","block_type":"box","text":"(“CLOs”) and other similarly structured securities. CDOs are types of asset-backed securities. A CBO","page_number":91,"box":{"x":117,"y":258,"width":756,"height":12}},{"id":"1f3409d1-80d5-485d-9d23-6b637aab3ec7","block_type":"box","text":"is ordinarily issued by a trust or other special purpose entity (“SPE”) and is typically backed by a","page_number":91,"box":{"x":117,"y":273,"width":716,"height":12}},{"id":"15116330-d7d1-4c7d-be2c-5bb2d563986b","block_type":"box","text":"diversified pool of fixed-income securities (which may include high risk, below investment grade","page_number":91,"box":{"x":116,"y":289,"width":713,"height":12}},{"id":"086fe6f9-1439-493d-9aaa-ea6df8f4aa61","block_type":"box","text":"securities) held by such issuer. A CLO is ordinarily issued by a trust or other SPE and is typically","page_number":91,"box":{"x":116,"y":304,"width":722,"height":12}},{"id":"58a83535-7de4-44bf-b94b-814c1fe70644","block_type":"box","text":"collateralized by a pool of loans, which may include, among others, domestic and non-U.S. senior","page_number":91,"box":{"x":116,"y":320,"width":729,"height":12}},{"id":"4deb0cc6-5c35-4977-b963-a0aecb075bf2","block_type":"box","text":"secured loans, senior unsecured loans, and subordinate corporate loans, including loans that may be","page_number":91,"box":{"x":116,"y":335,"width":756,"height":12}},{"id":"a6fe2bb5-5fc1-4032-b0c6-0ff73f4732a8","block_type":"box","text":"rated below investment grade or equivalent unrated loans, held by such issuer. Investments in a CLO","page_number":91,"box":{"x":117,"y":351,"width":757,"height":12}},{"id":"8d692849-b03e-4bc6-a7a4-a5b593211dfd","block_type":"box","text":"organized outside of the United States may not be deemed to be foreign securities if the CLO is","page_number":91,"box":{"x":116,"y":366,"width":715,"height":12}},{"id":"c9e4a131-464c-42b6-9d82-6f7c82edb7a8","block_type":"box","text":"collateralized by a pool of loans, a substantial portion of which are U.S. loans. Although certain CDOs","page_number":91,"box":{"x":116,"y":382,"width":758,"height":12}},{"id":"be02d914-79a1-4171-b500-fa5e72493be9","block_type":"box","text":"may benefit from credit enhancement in the form of a senior-subordinate structure, over","page_number":91,"box":{"x":117,"y":397,"width":655,"height":12}},{"id":"ee369173-6e46-44de-a031-96a5c9900e0c","block_type":"box","text":"collateralization or bond insurance, such enhancement may not always be present, and may fail to","page_number":91,"box":{"x":116,"y":413,"width":735,"height":12}},{"id":"d888c5a0-e056-4c1d-aea5-6c1721b3797b","block_type":"box","text":"protect a Fund against the risk of loss on default of the collateral. Certain CDO issuers may use","page_number":91,"box":{"x":117,"y":428,"width":713,"height":12}},{"id":"d7000d2f-4905-4fc6-a569-50f9e4ca0975","block_type":"box","text":"derivatives contracts to create “synthetic” exposure to assets rather than holding such assets directly,","page_number":91,"box":{"x":116,"y":444,"width":758,"height":12}},{"id":"77e9b302-6449-46ea-944f-19ef028efc78","block_type":"box","text":"which entails the risks of derivative instruments described elsewhere in this SAI. CDOs may charge","page_number":91,"box":{"x":116,"y":459,"width":742,"height":12}},{"id":"9eb4421e-8ad5-4c2e-8f01-abd3fe21b631","block_type":"box","text":"management fees and administrative expenses, which are in addition to those of a Fund.","page_number":91,"box":{"x":117,"y":475,"width":664,"height":12}},{"id":"cd8bf78f-1709-4463-8dd8-45331f638e62","block_type":"box","text":"For both CBOs and CLOs, the cash flows from the SPE are split into two or more portions, called","page_number":91,"box":{"x":117,"y":506,"width":724,"height":12}},{"id":"cd021007-aff3-47b7-91e9-6584a1eea46a","block_type":"box","text":"tranches, varying in risk and yield. The riskiest portion is the “equity” tranche, which bears the first loss","page_number":91,"box":{"x":116,"y":521,"width":765,"height":12}},{"id":"b63c3260-09da-4493-8c67-cb0815063ae8","block_type":"box","text":"from defaults from the bonds or loans in the SPE and serves to protect the other, more senior tranches","page_number":91,"box":{"x":116,"y":537,"width":768,"height":12}},{"id":"39790fe9-2038-4f44-b155-08afebf01845","block_type":"box","text":"from default (though such protection is not complete). Since it is partially protected from defaults, a","page_number":91,"box":{"x":116,"y":552,"width":737,"height":12}},{"id":"5b501e55-043b-4461-8fb7-f9a0e8001b04","block_type":"box","text":"senior tranche from a CBO or CLO typically has higher ratings and lower yields than its underlying","page_number":91,"box":{"x":116,"y":568,"width":733,"height":12}},{"id":"5a586d3f-5b98-481e-994a-f598fd6418ff","block_type":"box","text":"securities, and may be rated investment grade. Despite the protection from the equity tranche, CBO or","page_number":91,"box":{"x":116,"y":583,"width":765,"height":12}},{"id":"e9526792-86e4-429f-9083-4fe78c974a9d","block_type":"box","text":"CLO tranches can experience substantial losses due to actual defaults, downgrades of the underlying","page_number":91,"box":{"x":117,"y":599,"width":758,"height":12}},{"id":"16af6d38-77c1-4b6c-b383-f6fbb62585c9","block_type":"box","text":"collateral by rating agencies, forced liquidation of the collateral pool due to a failure of coverage tests,","page_number":91,"box":{"x":116,"y":614,"width":758,"height":12}},{"id":"56110f42-ad47-4ff7-9429-217bcba8b2df","block_type":"box","text":"increased sensitivity to defaults due to collateral default and disappearance of protecting tranches,","page_number":91,"box":{"x":117,"y":630,"width":734,"height":12}},{"id":"b1ae22fe-2b36-4ceb-84a9-452a819fa519","block_type":"box","text":"market anticipation of defaults as well as investor aversion to CBO or CLO securities as a class.","page_number":91,"box":{"x":117,"y":645,"width":716,"height":12}},{"id":"20f79a72-f403-4ea1-8d44-fbc5a2364537","block_type":"box","text":"Interest on certain tranches of a CDO may be paid in kind or deferred and capitalized (paid in the form","page_number":91,"box":{"x":117,"y":661,"width":757,"height":12}},{"id":"73bf2da4-7727-417c-9c01-62549bea06bd","block_type":"box","text":"of obligations of the same type rather than cash), which involves continued exposure to default risk","page_number":91,"box":{"x":116,"y":676,"width":734,"height":12}},{"id":"1ed1859e-b2de-4709-a48e-a4b62d552331","block_type":"box","text":"with respect to such payments.","page_number":91,"box":{"x":116,"y":692,"width":229,"height":12}},{"id":"a747a660-9d7d-4ef9-a4bd-9c39548a74d5","block_type":"box","text":"The risks of an investment in a CDO depend largely on the type of the collateral securities and the","page_number":91,"box":{"x":116,"y":723,"width":728,"height":12}},{"id":"619a6a99-0b74-455a-a0a7-67e548db019d","block_type":"box","text":"class of the CDO in which a Fund invests. Normally, CBOs, CLOs and other CDOs are privately","page_number":91,"box":{"x":116,"y":738,"width":712,"height":12}},{"id":"55869d7d-2ea1-4234-b24b-a566816e82f9","block_type":"box","text":"offered and sold, and thus are not registered under the securities laws. However, an active dealer","page_number":91,"box":{"x":116,"y":754,"width":725,"height":12}},{"id":"b7fa1b64-94d5-4b3f-979c-7fc1581472b9","block_type":"box","text":"market may exist for CDOs, allowing a CDO to qualify for Rule 144A transactions. In addition to the","page_number":91,"box":{"x":117,"y":769,"width":736,"height":12}},{"id":"c4c75b21-724d-44d1-994a-64b6c2dc799a","block_type":"box","text":"normal risks associated with fixed-income securities and asset-backed securities generally discussed","page_number":91,"box":{"x":117,"y":785,"width":750,"height":12}},{"id":"95bdcafb-71e3-4003-8ec7-57a2da1ad9df","block_type":"box","text":"elsewhere in this SAI, CDOs carry additional risks including, but not limited to: (i) the possibility that","page_number":91,"box":{"x":116,"y":800,"width":737,"height":12}},{"id":"624f6753-0e21-4963-8713-58d1b60d447d","block_type":"box","text":"distributions from collateral securities will not be adequate to make interest or other payments; (ii) the","page_number":91,"box":{"x":116,"y":816,"width":751,"height":12}},{"id":"8ecbb7ba-35a8-4eea-8fff-4bc11c5eabb3","block_type":"box","text":"risk that the collateral may default or decline in value or be downgraded, if rated by a nationally","page_number":91,"box":{"x":117,"y":831,"width":708,"height":12}},{"id":"b18aed6c-34b4-4490-8eb8-9281fba3b912","block_type":"box","text":"recognized statistical rating organization (“NRSRO”); (iii) a Fund may invest in tranches of CDOs that","page_number":91,"box":{"x":117,"y":847,"width":754,"height":12}},{"id":"8ab116e4-2e9f-4644-a52a-342e6af5480c","block_type":"box","text":"are subordinate to other tranches; (iv) the structure and complexity of the transaction and the legal","page_number":91,"box":{"x":116,"y":862,"width":736,"height":12}},{"id":"082fb593-3ce3-4ab6-af2e-262c30012f69","block_type":"box","text":"documents could lead to disputes among investors regarding the characterization of proceeds; (v) the","page_number":91,"box":{"x":116,"y":878,"width":760,"height":12}},{"id":"42abd7bc-e1ed-4d0e-b5a0-9505ddb3dc0c","block_type":"box","text":"II-4","page_number":91,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"ead8f479-6d91-4e66-86a8-e89c2c4586c2","block_type":"box","text":"NM1026U-6004382-91/605","page_number":91,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"2872fe64-999b-4384-ba38-7e95d282fed2","block_type":"box","text":"investment return achieved by the Fund could be significantly different than those predicted by financial","page_number":92,"box":{"x":117,"y":87,"width":771,"height":12}},{"id":"a9fcc02c-52c7-4900-af67-7a81fbcd0606","block_type":"box","text":"models; (vi) the lack of a readily available secondary market for CDOs; (vii) the risk of forced “fire sale”","page_number":92,"box":{"x":117,"y":102,"width":765,"height":13}},{"id":"46053df2-0b31-47d7-9fe4-432d83eaf50c","block_type":"box","text":"liquidation due to technical defaults such as coverage test failures; and (viii) the CDO’s manager may","page_number":92,"box":{"x":117,"y":118,"width":756,"height":12}},{"id":"44acd4a2-24ed-45a3-ad3d-f637d2d2fce3","block_type":"box","text":"perform poorly.","page_number":92,"box":{"x":117,"y":134,"width":117,"height":12}},{"id":"70ad7f03-e3e6-4901-9974-c5cee791dfe3","block_type":"box","text":"Commercial Paper.","page_number":92,"box":{"x":117,"y":165,"width":150,"height":11}},{"id":"83625789-81db-4b47-93f6-73724fadaa67","block_type":"box","text":"Certain Funds may purchase commercial paper. Commercial paper purchasable","page_number":92,"box":{"x":268,"y":165,"width":607,"height":12}},{"id":"8cf4c400-bfae-43e5-b336-13c7273b2929","block_type":"box","text":"by each Fund includes “Section 4(a)(2) paper,” a term that includes debt obligations issued in reliance","page_number":92,"box":{"x":117,"y":180,"width":760,"height":12}},{"id":"81286793-675e-4bf4-b233-ff0a520342ee","block_type":"box","text":"on the “private placement” exemption from registration afforded by Section 4(a)(2) of the Securities","page_number":92,"box":{"x":116,"y":196,"width":739,"height":12}},{"id":"697ce28a-162d-4d9a-846f-b05b8570b7ef","block_type":"box","text":"Act. Section 4(a)(2) paper is restricted as to disposition under the Federal securities laws, and is","page_number":92,"box":{"x":116,"y":211,"width":719,"height":12}},{"id":"bb684499-fee2-4a3f-9e31-71130060ed40","block_type":"box","text":"frequently sold (and resold) to institutional investors such as the Fund through or with the assistance of","page_number":92,"box":{"x":116,"y":227,"width":769,"height":12}},{"id":"18a38623-6626-4eb1-aa05-de51df9624bb","block_type":"box","text":"investment dealers who make a market in the Section 4(a)(2) paper, thereby providing liquidity. Certain","page_number":92,"box":{"x":117,"y":242,"width":769,"height":12}},{"id":"8facea54-6860-408c-bfd8-51d4626b9606","block_type":"box","text":"transactions in Section 4(a)(2) paper may qualify for the registration exemption provided in Rule 144A","page_number":92,"box":{"x":116,"y":258,"width":759,"height":12}},{"id":"adda27c1-40b0-46b2-a0a5-95354099ccec","block_type":"box","text":"under the Securities Act. Most Funds can purchase commercial paper rated (at the time of purchase)","page_number":92,"box":{"x":117,"y":273,"width":754,"height":12}},{"id":"5b71e2dd-63a3-4b80-934b-fc72dd758059","block_type":"box","text":"“A-1” by S&P or “Prime-1” by Moody’s or when deemed advisable by a Fund’s Manager or sub-adviser,","page_number":92,"box":{"x":116,"y":289,"width":772,"height":12}},{"id":"819c0b71-f7c7-4ebd-a796-44640f7f237b","block_type":"box","text":"“high quality” issues rated “A-2”, “Prime-2” or “F-2” by S&P, Moody’s or Fitch, respectively.","page_number":92,"box":{"x":116,"y":304,"width":675,"height":12}},{"id":"b49907d9-6d50-414e-843c-84d51addb73d","block_type":"box","text":"Commercial paper is generally considered to be short-term unsecured debt of corporations. Like all","page_number":92,"box":{"x":117,"y":335,"width":740,"height":12}},{"id":"96214f91-168d-4699-ab63-90f1cddc2f5f","block_type":"box","text":"fixed income securities, commercial paper prices are susceptible to fluctuations in interest rates. If","page_number":92,"box":{"x":116,"y":351,"width":732,"height":12}},{"id":"03e3fe02-2472-4346-bb4e-a4cd46e68e07","block_type":"box","text":"interest rates rise, commercial paper prices will decline and vice versa. However, the short-term nature","page_number":92,"box":{"x":117,"y":366,"width":767,"height":12}},{"id":"e32ecb12-59ee-4d1f-a5f9-26a9706c95f0","block_type":"box","text":"of a commercial paper investment generally makes it less susceptible to volatility than many other fixed","page_number":92,"box":{"x":116,"y":382,"width":771,"height":12}},{"id":"7375e330-39b7-4bdb-ab9e-a4451227b6ca","block_type":"box","text":"income securities because interest rate risk typically increases as maturity lengths increase.","page_number":92,"box":{"x":117,"y":397,"width":686,"height":12}},{"id":"024a90a2-b2b5-452d-bfc4-4ecb984b2a28","block_type":"box","text":"Commercial paper tends to yield smaller returns than longer-term corporate debt because securities","page_number":92,"box":{"x":117,"y":413,"width":746,"height":12}},{"id":"a709ee97-5413-4163-95b0-d566f1438015","block_type":"box","text":"with shorter maturities typically have lower effective yields than those with longer maturities.","page_number":92,"box":{"x":116,"y":428,"width":686,"height":12}},{"id":"da662bce-3ad6-45d6-a427-5980e1fb50be","block_type":"box","text":"Commodity-Linked Derivative Instruments and Hybrid Instruments.","page_number":92,"box":{"x":117,"y":459,"width":535,"height":12}},{"id":"71f5b542-57d8-4d6f-9309-d1445faffbe1","block_type":"box","text":"Certain Funds seek to gain","page_number":92,"box":{"x":653,"y":459,"width":210,"height":12}},{"id":"1694dc71-2468-4835-b68d-c58fba37c10b","block_type":"box","text":"exposure to the commodities markets primarily through investments in hybrid instruments. Hybrid","page_number":92,"box":{"x":116,"y":475,"width":727,"height":12}},{"id":"80bd6ac5-4284-4a13-88c2-c379325e7ad3","block_type":"box","text":"instruments are either equity or debt derivative securities with one or more commodity-dependent","page_number":92,"box":{"x":117,"y":490,"width":727,"height":12}},{"id":"aae0dde9-65ce-48d5-9e3e-73fd4b1fb55c","block_type":"box","text":"components that have payment features similar to a commodity futures contract, a commodity option","page_number":92,"box":{"x":116,"y":506,"width":753,"height":12}},{"id":"e69a98aa-222a-47c4-9948-118138b768ee","block_type":"box","text":"contract, or a combination of both. Therefore, these instruments are “commodity-linked.” They are","page_number":92,"box":{"x":116,"y":521,"width":731,"height":12}},{"id":"0f0ef066-3625-4be7-8a1d-2359e0c3b104","block_type":"box","text":"considered “hybrid” instruments because they have both commodity-like and security-like","page_number":92,"box":{"x":116,"y":537,"width":667,"height":12}},{"id":"ce06b3a5-e270-42b5-b723-f7718ff2ec0b","block_type":"box","text":"characteristics. Hybrid instruments are derivative instruments because at least part of their value is","page_number":92,"box":{"x":116,"y":552,"width":738,"height":12}},{"id":"3b33e8df-14d4-4478-8581-f627cfbc8b95","block_type":"box","text":"derived from the value of an underlying commodity, futures contract, index or other readily measurable","page_number":92,"box":{"x":116,"y":568,"width":766,"height":12}},{"id":"50af7cae-c6bc-465e-8cb8-aeb764310f87","block_type":"box","text":"economic variable.","page_number":92,"box":{"x":116,"y":583,"width":145,"height":10}},{"id":"19837d96-78e0-4ccb-96da-07e365aae2f1","block_type":"box","text":"The prices of commodity-linked derivative instruments may move in different directions than","page_number":92,"box":{"x":116,"y":614,"width":686,"height":12}},{"id":"cc9200de-d5a3-4d12-b626-9a39f8101b06","block_type":"box","text":"investments in traditional equity and debt securities when the value of those traditional securities is","page_number":92,"box":{"x":117,"y":630,"width":737,"height":12}},{"id":"779559db-0f71-48e6-b5f6-7ff4c9ff6ea2","block_type":"box","text":"declining due to adverse economic conditions. As an example, during periods of rising inflation, debt","page_number":92,"box":{"x":116,"y":645,"width":749,"height":12}},{"id":"fd2982d0-4575-4839-8a2e-3d250a8908b3","block_type":"box","text":"securities have historically tended to decline in value due to the general increase in prevailing interest","page_number":92,"box":{"x":116,"y":661,"width":753,"height":12}},{"id":"d14ff8af-672f-4e64-9557-28f206ba1aab","block_type":"box","text":"rates. Conversely, during those same periods of rising inflation, the prices of certain commodities, such","page_number":92,"box":{"x":117,"y":676,"width":763,"height":12}},{"id":"afecdd83-9404-4aa5-ae46-d8858b21b579","block_type":"box","text":"as oil and metals, have historically tended to increase. Of course, there cannot be any guarantee that","page_number":92,"box":{"x":116,"y":692,"width":752,"height":12}},{"id":"6689145d-10cb-4f9b-a049-b8bf3021c3af","block_type":"box","text":"these investments will perform in that manner in the future, and at certain times the price movements","page_number":92,"box":{"x":116,"y":707,"width":749,"height":12}},{"id":"cdd3a9a6-a723-4497-b789-4a768eb62cb1","block_type":"box","text":"of commodity-linked instruments have been parallel to those of debt and equity securities.","page_number":92,"box":{"x":116,"y":723,"width":665,"height":12}},{"id":"eab376bd-cac2-4fe6-904d-2c8189a6a173","block_type":"box","text":"Commodities have historically tended to increase and decrease in value during different parts of the","page_number":92,"box":{"x":117,"y":738,"width":739,"height":12}},{"id":"59ccdb23-9929-426d-97e9-4bb738196e83","block_type":"box","text":"business cycle than financial assets. Nevertheless, at various times, commodities prices may move in","page_number":92,"box":{"x":117,"y":754,"width":753,"height":12}},{"id":"5479770e-d28e-4781-930f-9584c0caf7e4","block_type":"box","text":"tandem with the prices of financial assets and thus may not provide overall portfolio diversification","page_number":92,"box":{"x":116,"y":769,"width":725,"height":12}},{"id":"c5fc14f3-8b09-4515-b3a0-87f441a51dc7","block_type":"box","text":"benefits. Under favorable economic conditions, the Fund’s investments may be expected to under","page_number":92,"box":{"x":117,"y":785,"width":731,"height":12}},{"id":"51b83a09-fe95-46f9-9223-c9643e9df535","block_type":"box","text":"perform an investment in traditional securities. Over the long term, the returns on the Fund’s","page_number":92,"box":{"x":117,"y":800,"width":682,"height":12}},{"id":"a570fd11-d1a5-40f5-a699-be93ae22a1d8","block_type":"box","text":"investments are expected to exhibit low or negative correlation with stocks and bonds.","page_number":92,"box":{"x":117,"y":816,"width":637,"height":12}},{"id":"3a6998cf-4b0b-409e-9b55-7257be19db39","block_type":"box","text":"Qualifying Hybrid Instruments.","page_number":92,"box":{"x":117,"y":847,"width":222,"height":12}},{"id":"4f7b1347-c69b-4e31-922a-ee01a5c586d0","block_type":"box","text":"Certain Funds may invest in hybrid instruments that qualify for exclusion","page_number":92,"box":{"x":341,"y":847,"width":546,"height":12}},{"id":"b3532df6-438a-414f-af81-2ef92244526e","block_type":"box","text":"from regulation under the Commodity Exchange Act and the regulations adopted thereunder. A hybrid","page_number":92,"box":{"x":116,"y":862,"width":761,"height":12}},{"id":"1522ff05-7af9-4c00-bffd-9fe44b3c98b9","block_type":"box","text":"instrument that qualifies for this exclusion from regulation must be “predominantly a security.” A hybrid","page_number":92,"box":{"x":117,"y":878,"width":762,"height":12}},{"id":"09e8115e-d17a-4a48-9e15-99e4c62f7451","block_type":"box","text":"II-5","page_number":92,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"9e1c9584-c8be-45b6-aa46-73baae928947","block_type":"box","text":"NM1026U-6004382-92/605","page_number":92,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"d4eb4229-dbd3-4ea7-97b9-7c0bc88c9233","block_type":"box","text":"instrument is considered to be predominantly a security if (a) the issuer of the hybrid instrument","page_number":93,"box":{"x":117,"y":87,"width":712,"height":12}},{"id":"afc3af8f-5a0d-4c4d-b17d-f21bd35cb4be","block_type":"box","text":"receives payment in full of the purchase price of the hybrid instrument, substantially","page_number":93,"box":{"x":117,"y":102,"width":624,"height":13}},{"id":"b1d3472a-56bc-4765-93b7-63628e9bc962","block_type":"box","text":"contemporaneously with delivery of the hybrid instrument; (b) the purchaser or holder of the hybrid","page_number":93,"box":{"x":116,"y":118,"width":735,"height":12}},{"id":"0a4a12f1-e7c4-4d6e-a93e-5e69cae84fdb","block_type":"box","text":"instrument is not required to make any payment to the issuer in addition to the purchase price paid","page_number":93,"box":{"x":117,"y":134,"width":735,"height":12}},{"id":"792120cc-c154-4fac-b1c2-ee65e017ab7f","block_type":"box","text":"under subparagraph (a), whether as margin, settlement payment, or otherwise, during the life of the","page_number":93,"box":{"x":117,"y":149,"width":743,"height":12}},{"id":"2dd3d33f-57a1-4655-a308-d20ae5520dd3","block_type":"box","text":"hybrid instrument or at maturity; (c) the issuer of the hybrid instrument is not subject by the terms of the","page_number":93,"box":{"x":117,"y":165,"width":770,"height":12}},{"id":"3fbc5a61-d303-4be1-b481-2e170659c13a","block_type":"box","text":"instrument to mark-to-market margining requirements; and (d) the hybrid instrument is not marketed as","page_number":93,"box":{"x":117,"y":180,"width":768,"height":12}},{"id":"9f30ccda-330e-4613-a4d9-67930b05a1e5","block_type":"box","text":"a contract of sale of a commodity for future delivery (or option on such a contract) subject to applicable","page_number":93,"box":{"x":116,"y":196,"width":768,"height":12}},{"id":"348d2a2f-4f9e-46af-83a8-078d715e83b4","block_type":"box","text":"provisions of the Commodity Exchange Act. Hybrid instruments may be principal protected, partially","page_number":93,"box":{"x":117,"y":211,"width":743,"height":12}},{"id":"b32d2e8f-5701-4df8-aa12-e4faf953d9bf","block_type":"box","text":"protected, or offer no principal protection. A principal protected hybrid instrument means that the issuer","page_number":93,"box":{"x":117,"y":227,"width":768,"height":12}},{"id":"fe816d58-b84d-4cba-983f-596f975b2f0b","block_type":"box","text":"will pay, at a minimum, the par value of the note at maturity. Therefore, if the commodity value to which","page_number":93,"box":{"x":116,"y":242,"width":770,"height":12}},{"id":"5c763031-9b38-4856-b0d4-6e8fb172c431","block_type":"box","text":"the hybrid instrument is linked declines over the life of the note, the Fund will receive at maturity the","page_number":93,"box":{"x":116,"y":258,"width":744,"height":12}},{"id":"51700706-1ac6-457f-bfd9-b79cedae3963","block_type":"box","text":"face or stated value of the note. With a principal protected hybrid instrument, the Fund will receive at","page_number":93,"box":{"x":116,"y":273,"width":750,"height":12}},{"id":"649a1224-698d-4a5f-9c88-90926188d06c","block_type":"box","text":"maturity the greater of the par value of the note or the increase in its value based on the underlying","page_number":93,"box":{"x":117,"y":289,"width":739,"height":12}},{"id":"51b6b527-7cab-4942-8d5c-ce35c4547a02","block_type":"box","text":"commodity or index. This protection is, in effect, an option whose value is subject to the volatility and","page_number":93,"box":{"x":116,"y":304,"width":751,"height":12}},{"id":"585690d6-4b90-4ff9-82ff-ae9eae99499c","block_type":"box","text":"price level of the underlying commodity. The Manager’s decision whether to use principal protection","page_number":93,"box":{"x":117,"y":320,"width":743,"height":12}},{"id":"e99e97d3-5c88-4d55-812b-8b7af6608ff1","block_type":"box","text":"depends in part on the cost of the protection. In addition, the protection feature depends upon the","page_number":93,"box":{"x":116,"y":335,"width":728,"height":12}},{"id":"0d1b1465-f98b-4fe6-b41f-a9496de39820","block_type":"box","text":"ability of the issuer to meet its obligation to buy back the security, and, therefore, depends on the","page_number":93,"box":{"x":116,"y":351,"width":724,"height":12}},{"id":"b9c58334-3ad9-4aaa-92fd-62932d25106f","block_type":"box","text":"creditworthiness of the issuer. With full principal protection, the Fund will receive at maturity of the","page_number":93,"box":{"x":116,"y":366,"width":731,"height":12}},{"id":"eccabbb1-7e8d-4204-ac84-700ae32ee403","block_type":"box","text":"hybrid instrument either the stated par value of the hybrid instrument, or potentially, an amount greater","page_number":93,"box":{"x":117,"y":382,"width":764,"height":12}},{"id":"62bb7212-30fa-4e9b-9101-6de26fffcaeb","block_type":"box","text":"than the stated par value if the underlying commodity, index, futures contract or economic variable to","page_number":93,"box":{"x":116,"y":397,"width":753,"height":12}},{"id":"a5c510af-a4bc-4068-9fce-6cddaeae99d1","block_type":"box","text":"which the hybrid instrument is linked has increased in value. Partially protected hybrid instruments may","page_number":93,"box":{"x":116,"y":413,"width":770,"height":12}},{"id":"23128cce-c083-4d95-82c0-74bf4b2e14b8","block_type":"box","text":"suffer some loss of principal if the underlying commodity, index, futures contract or economic variable","page_number":93,"box":{"x":116,"y":428,"width":758,"height":12}},{"id":"ab04cad7-d4c6-4e57-850f-e607f40bd2c2","block_type":"box","text":"to which the hybrid instrument is linked declines in value during the term of the hybrid instrument.","page_number":93,"box":{"x":116,"y":444,"width":726,"height":12}},{"id":"79e9674a-cb54-4b6c-836f-60c37836a372","block_type":"box","text":"However, partially protected hybrid instruments have a specified limit as to the amount of principal that","page_number":93,"box":{"x":117,"y":459,"width":764,"height":12}},{"id":"1bcb4dc6-e174-4a97-8dc6-c856ae346ed5","block_type":"box","text":"they may lose.","page_number":93,"box":{"x":116,"y":475,"width":113,"height":12}},{"id":"6565a990-508a-48b8-881c-556dfa758182","block_type":"box","text":"Hybrid Instruments Without Principal Protection.","page_number":93,"box":{"x":116,"y":506,"width":355,"height":12}},{"id":"93a81691-d634-4ec7-a684-314d14fdc48f","block_type":"box","text":"Certain Funds may invest in hybrid instruments that","page_number":93,"box":{"x":473,"y":506,"width":393,"height":12}},{"id":"6f17181b-e0ab-4ce7-b14a-604e1051db5c","block_type":"box","text":"offer no principal protection. At maturity, there is a risk that the underlying commodity price, futures","page_number":93,"box":{"x":116,"y":521,"width":738,"height":12}},{"id":"712bcd70-9c8a-46b4-957b-00bde81e8211","block_type":"box","text":"contract, index or other economic variable may have declined sufficiently in value such that some or all","page_number":93,"box":{"x":116,"y":537,"width":768,"height":12}},{"id":"715459fb-8beb-4cbb-9e6d-d5b97f6d2621","block_type":"box","text":"of the face value of the hybrid instrument might not be returned. The Manager, at its discretion, may","page_number":93,"box":{"x":116,"y":552,"width":746,"height":12}},{"id":"a696de0c-8d8a-4884-8c91-df7af6c0efaa","block_type":"box","text":"invest in a partially protected principal structured note or a note without principal protection. In deciding","page_number":93,"box":{"x":117,"y":568,"width":767,"height":12}},{"id":"c3f45602-be4b-4e95-88ef-2e13dc0f6067","block_type":"box","text":"to purchase a note without principal protection, the Manager may consider, among other things, the","page_number":93,"box":{"x":116,"y":583,"width":743,"height":12}},{"id":"9fbc3961-c365-4ca3-be9f-d49816c785c9","block_type":"box","text":"expected performance of the underlying commodity futures contract, index or other economic variable","page_number":93,"box":{"x":116,"y":599,"width":761,"height":12}},{"id":"a5daaf07-09af-4a13-a0d9-cb97b91bfd6a","block_type":"box","text":"over the term of the note, the cost of the note, and any other economic factors that the Manager","page_number":93,"box":{"x":116,"y":614,"width":717,"height":12}},{"id":"dcab85ea-6ea4-428a-902c-980990413cec","block_type":"box","text":"believes are relevant.","page_number":93,"box":{"x":117,"y":630,"width":163,"height":9}},{"id":"20bca642-e15d-4295-b9d4-8650019a36dd","block_type":"box","text":"Limitations on Leverage.","page_number":93,"box":{"x":116,"y":661,"width":181,"height":12}},{"id":"6361e892-03ce-4acf-bb82-3c5bcfbba2fb","block_type":"box","text":"Some of the hybrid instruments in which a Fund may invest may involve","page_number":93,"box":{"x":304,"y":661,"width":534,"height":12}},{"id":"e3aa0ca0-216e-4e0c-a00b-b4b6981f517d","block_type":"box","text":"leverage. To avoid being subject to undue leverage risk, a Fund will seek to limit the amount of","page_number":93,"box":{"x":117,"y":676,"width":703,"height":12}},{"id":"6413ad33-60f5-4f0d-8310-5f78fb5d7e6a","block_type":"box","text":"economic leverage it has under any one hybrid instrument that it buys and the leverage of the Fund’s","page_number":93,"box":{"x":116,"y":692,"width":750,"height":12}},{"id":"3728e58e-9a29-4572-8547-8c17a5c58967","block_type":"box","text":"overall portfolio. A Fund will not invest in a hybrid instrument if, at the time of purchase: (i) that","page_number":93,"box":{"x":116,"y":707,"width":699,"height":12}},{"id":"f0c88b2d-b04e-4e62-9f50-b11e9a270e15","block_type":"box","text":"instrument’s “leverage ratio” exceeds 300% of the price increase in the underlying commodity, futures","page_number":93,"box":{"x":117,"y":723,"width":753,"height":12}},{"id":"2648732c-08ac-413d-b0ee-300c630b06ae","block_type":"box","text":"contract, index or other economic variable or (ii) the Fund’s “portfolio leverage ratio” exceeds 150%,","page_number":93,"box":{"x":116,"y":738,"width":739,"height":12}},{"id":"c105590b-f965-4ec0-af57-ea9e7e1e57df","block_type":"box","text":"measured at the time of purchase. “Leverage ratio” is the expected increase in the value of a hybrid","page_number":93,"box":{"x":117,"y":754,"width":737,"height":12}},{"id":"2239af8f-9d8e-474c-8151-503752bd097f","block_type":"box","text":"instrument, assuming a one percent price increase in the underlying commodity, futures contract, index","page_number":93,"box":{"x":117,"y":769,"width":765,"height":12}},{"id":"50d53edd-3f7f-48c1-a869-f4b317a0b800","block_type":"box","text":"or other economic factor. In other words, for a hybrid instrument with a leverage factor of 150%, a 1%","page_number":93,"box":{"x":116,"y":785,"width":752,"height":12}},{"id":"4f90d44c-f5b2-4454-a38a-3977001bc477","block_type":"box","text":"gain in the underlying economic variable would be expected to result in a 1.5% gain in value for the","page_number":93,"box":{"x":116,"y":800,"width":735,"height":12}},{"id":"cf996e9c-62b3-4140-84c6-d47ec0a74fe1","block_type":"box","text":"hybrid instrument. Conversely, a hybrid instrument with a leverage factor of 150% would suffer a 1.5%","page_number":93,"box":{"x":117,"y":816,"width":757,"height":12}},{"id":"ad1d6186-c88d-474b-a655-1c77f0b8830a","block_type":"box","text":"loss if the underlying economic variable lost 1% of its value. “Portfolio leverage ratio” is defined as the","page_number":93,"box":{"x":117,"y":831,"width":758,"height":12}},{"id":"b9d50b21-99b2-499f-920d-ef83bce3a538","block_type":"box","text":"average (mean) leverage ratio of all instruments in a Fund’s portfolio, weighted by the market values of","page_number":93,"box":{"x":116,"y":847,"width":769,"height":12}},{"id":"a2d6b0ee-e59a-499c-8ee9-2fb17a5b4d50","block_type":"box","text":"such instruments or, in the case of futures contracts, their notional values. A Fund may at times or from","page_number":93,"box":{"x":116,"y":862,"width":771,"height":12}},{"id":"25c20823-8544-42d7-ac26-5dd433724f59","block_type":"box","text":"II-6","page_number":93,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"aa84c7ae-b3bc-4761-b35a-756e5f71dff5","block_type":"box","text":"NM1026U-6004382-93/605","page_number":93,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"b2be6288-ec88-449b-a2c5-786c91763d16","block_type":"box","text":"time to time decide not to use leverage in its investments or use less leverage than may otherwise be","page_number":94,"box":{"x":116,"y":87,"width":757,"height":12}},{"id":"f1c5b080-2769-44b6-b890-dc112c8ddea5","block_type":"box","text":"allowable.","page_number":94,"box":{"x":116,"y":103,"width":79,"height":9}},{"id":"b39a3d5a-2706-4c41-aa90-b385298da7c6","block_type":"box","text":"Counterparty Risk.","page_number":94,"box":{"x":117,"y":134,"width":136,"height":12}},{"id":"43c27a83-8d3d-4c00-ba39-d968781e36fd","block_type":"box","text":"A significant risk of hybrid instruments is counterparty risk. Unlike exchange-traded","page_number":94,"box":{"x":255,"y":134,"width":625,"height":12}},{"id":"c3f8e8c7-8ea2-4995-9887-dcdb82740834","block_type":"box","text":"futures and options, which are standard contracts, hybrid instruments are customized securities, tailor","page_number":94,"box":{"x":116,"y":149,"width":760,"height":12}},{"id":"da7bc644-1ee0-4056-8673-f327ac20eb64","block_type":"box","text":"made by a specific issuer. With a listed futures or options contract, an investor’s counterparty is the","page_number":94,"box":{"x":117,"y":165,"width":740,"height":12}},{"id":"99ae94e9-3127-4820-a933-2384890463d3","block_type":"box","text":"exchange clearinghouse. Exchange clearinghouses are capitalized by the exchange members and","page_number":94,"box":{"x":116,"y":180,"width":738,"height":12}},{"id":"57cf900e-457c-4d80-904b-80868c243c07","block_type":"box","text":"typically have high investment grade ratings (","page_number":94,"box":{"x":116,"y":196,"width":336,"height":12}},{"id":"9b790beb-2666-4330-821c-0bb7cb2f8c7b","block_type":"box","text":"e.g.","page_number":94,"box":{"x":453,"y":198,"width":26,"height":10}},{"id":"c4a5ab70-488c-4af5-9f4f-be9f1c9a0da4","block_type":"box","text":", ratings of AAA or AA by S&P). Therefore, the risk is","page_number":94,"box":{"x":482,"y":196,"width":396,"height":12}},{"id":"601db5f5-1c90-4fb3-a717-5f12a518e15f","block_type":"box","text":"small that an exchange clearinghouse might be unable to meet its obligations at maturity. However,","page_number":94,"box":{"x":116,"y":211,"width":743,"height":12}},{"id":"2213ccac-9bf3-4bbe-8986-2bae6a0f9a5b","block_type":"box","text":"with a hybrid instrument, a Fund will take on the counterparty credit risk of the issuer. That is, at","page_number":94,"box":{"x":116,"y":227,"width":715,"height":12}},{"id":"e2dc01ec-9812-48eb-9f49-464e22e738e1","block_type":"box","text":"maturity of the hybrid instrument, there is a risk that the issuer may be unable to perform its obligations","page_number":94,"box":{"x":117,"y":242,"width":767,"height":12}},{"id":"234acefe-632f-4ed9-ae62-e7ae55fa4448","block_type":"box","text":"under the structured note.","page_number":94,"box":{"x":117,"y":258,"width":196,"height":9}},{"id":"6eeeb538-2ff7-427b-8172-a9160d2aac83","block_type":"box","text":"Convertible Securities.","page_number":94,"box":{"x":117,"y":289,"width":180,"height":9}},{"id":"bcc51cf4-4090-4b13-8425-660fc2134f87","block_type":"box","text":"A convertible security is a bond, debenture, note, preferred stock or other","page_number":94,"box":{"x":298,"y":289,"width":554,"height":12}},{"id":"a628105f-32e4-4447-b7c4-7d97d5000f0a","block_type":"box","text":"security that may be converted into or exchanged for a prescribed amount of common stock or other","page_number":94,"box":{"x":116,"y":304,"width":750,"height":12}},{"id":"70fdafc5-d37a-4683-8fef-52631bd72cfb","block_type":"box","text":"equity security of the same or a different issuer within a particular period of time at a specified price or","page_number":94,"box":{"x":116,"y":320,"width":761,"height":12}},{"id":"21dad713-9a13-4f6e-ac28-8ebfd23a92ec","block_type":"box","text":"formula. A convertible security entitles the holder to receive interest paid or accrued on debt or the","page_number":94,"box":{"x":116,"y":335,"width":734,"height":12}},{"id":"6c6db385-93d4-4d5e-bbd2-61b3148816b6","block_type":"box","text":"dividend paid on preferred stock until the convertible security matures or is redeemed, converted or","page_number":94,"box":{"x":116,"y":351,"width":742,"height":12}},{"id":"804dc084-e7e3-45eb-bf55-dda42bd3ebec","block_type":"box","text":"exchanged. Before conversion, convertible securities have characteristics similar to nonconvertible","page_number":94,"box":{"x":116,"y":366,"width":738,"height":12}},{"id":"d9a242ea-ffb6-4f80-8f46-9f6a49a43b56","block_type":"box","text":"income securities in that they ordinarily provide a stable stream of income with generally higher yields","page_number":94,"box":{"x":117,"y":382,"width":757,"height":12}},{"id":"846ec309-4a0d-4073-b054-f9d275986012","block_type":"box","text":"than those of common stocks of the same or similar issuers, but lower yields than comparable","page_number":94,"box":{"x":116,"y":397,"width":703,"height":12}},{"id":"84f60057-964a-4d7d-b8c2-344a5c05d9fc","block_type":"box","text":"nonconvertible securities. The value of a convertible security is influenced by changes in interest rates,","page_number":94,"box":{"x":117,"y":413,"width":767,"height":12}},{"id":"6bc6cdd9-a48c-4933-8f69-07e0e0251fd4","block_type":"box","text":"with investment value declining as interest rates increase and increasing as interest rates decline. The","page_number":94,"box":{"x":116,"y":428,"width":764,"height":12}},{"id":"b472fb10-ba00-4ac4-a044-1711c3ca96ca","block_type":"box","text":"credit standing of the issuer and other factors also may have an effect on the convertible security’s","page_number":94,"box":{"x":116,"y":444,"width":736,"height":12}},{"id":"d072270b-e0ed-478d-96e8-47d80f9a5a6b","block_type":"box","text":"investment value. Convertible securities rank senior to common stock in a corporation’s capital","page_number":94,"box":{"x":117,"y":459,"width":706,"height":12}},{"id":"b108c46b-39ca-4c15-8112-dffe7a9e30ee","block_type":"box","text":"structure but are usually subordinated to comparable nonconvertible securities. Convertible securities","page_number":94,"box":{"x":116,"y":475,"width":757,"height":12}},{"id":"2da06b5c-d9ba-47c0-90d0-fd965efa2857","block_type":"box","text":"may be subject to redemption at the option of the issuer at a price established in the convertible","page_number":94,"box":{"x":117,"y":490,"width":714,"height":12}},{"id":"85daa4fe-498e-48b4-ab1c-2e1ca82a4b27","block_type":"box","text":"security’s governing instrument.","page_number":94,"box":{"x":116,"y":506,"width":241,"height":12}},{"id":"f0d00030-0e92-41ad-8c75-cd56c0a94d8c","block_type":"box","text":"The characteristics of convertible securities make them potentially attractive investments for an","page_number":94,"box":{"x":116,"y":537,"width":710,"height":12}},{"id":"b497c320-4d66-461a-a507-53026491ff64","block_type":"box","text":"investment company seeking a high total return from capital appreciation and investment income.","page_number":94,"box":{"x":117,"y":552,"width":727,"height":12}},{"id":"31b40e13-2210-4b17-8477-a380987f655a","block_type":"box","text":"These characteristics include the potential for capital appreciation as the value of the underlying","page_number":94,"box":{"x":116,"y":568,"width":716,"height":12}},{"id":"122b0786-35ae-4e80-a42c-e2958252b540","block_type":"box","text":"common stock increases, the relatively high yield received from dividend or interest payments as","page_number":94,"box":{"x":116,"y":583,"width":723,"height":12}},{"id":"f6d3aee0-a94a-4b5c-b88a-a289df63052b","block_type":"box","text":"compared to common stock dividends and decreased risks of decline in value relative to the underlying","page_number":94,"box":{"x":116,"y":599,"width":770,"height":12}},{"id":"d5edc6f3-5589-4428-a0a2-853a236c8123","block_type":"box","text":"common stock due to their fixed-income nature. As a result of the conversion feature, however, the","page_number":94,"box":{"x":116,"y":614,"width":739,"height":11}},{"id":"9e87a5d6-0c5d-4f11-880c-4c1e25fbcb17","block_type":"box","text":"interest rate or dividend preference on a convertible security is generally less than would be the case if","page_number":94,"box":{"x":117,"y":630,"width":766,"height":12}},{"id":"46269266-8911-406d-aa61-86e77230c92a","block_type":"box","text":"the securities were issued in nonconvertible form.","page_number":94,"box":{"x":116,"y":645,"width":373,"height":10}},{"id":"b532e648-c6a1-434e-a92d-23392f032363","block_type":"box","text":"In analyzing convertible securities, the Manager will consider both the yield on the convertible security","page_number":94,"box":{"x":117,"y":676,"width":755,"height":12}},{"id":"84c3451d-ea4a-44e9-890e-779e15fa84e4","block_type":"box","text":"relative to its credit quality and the potential capital appreciation that is offered by the underlying","page_number":94,"box":{"x":117,"y":692,"width":710,"height":12}},{"id":"273116bf-08f2-4171-b8b6-45c4c222d456","block_type":"box","text":"common stock, among other things.","page_number":94,"box":{"x":116,"y":707,"width":265,"height":12}},{"id":"97b6810f-df89-4b04-9e30-6e412f38fef9","block_type":"box","text":"Convertible securities are issued and traded in a number of securities markets. Even in cases where a","page_number":94,"box":{"x":117,"y":738,"width":758,"height":10}},{"id":"461e2403-5572-4850-b6aa-8fb117c77069","block_type":"box","text":"substantial portion of the convertible securities held by a Fund are denominated in U.S. dollars, the","page_number":94,"box":{"x":116,"y":754,"width":734,"height":12}},{"id":"c3a0d7ee-2e40-4148-8dce-dd7906180a5e","block_type":"box","text":"underlying equity securities may be quoted in the currency of the country where the issuer is domiciled.","page_number":94,"box":{"x":117,"y":769,"width":764,"height":12}},{"id":"a0bc4d40-1195-4192-9001-5c29ea7facb2","block_type":"box","text":"As a result, fluctuations in the exchange rate between the currency in which the debt security is","page_number":94,"box":{"x":116,"y":785,"width":707,"height":12}},{"id":"991ac19a-a014-4b4d-b1f3-57d7ab41f72f","block_type":"box","text":"denominated and the currency in which the share price is quoted will affect the value of the convertible","page_number":94,"box":{"x":116,"y":800,"width":761,"height":12}},{"id":"2e6e77e2-f168-4152-a0ac-9b9dc292e05c","block_type":"box","text":"security. With respect to convertible securities denominated in a currency different from that of the","page_number":94,"box":{"x":116,"y":816,"width":728,"height":12}},{"id":"13c2abff-7933-4a4e-82ce-2d50a10a79e0","block_type":"box","text":"underlying equity securities, the conversion price may be based on a fixed exchange rate established","page_number":94,"box":{"x":117,"y":831,"width":756,"height":12}},{"id":"98bbc83c-36c4-4a23-9fbd-7b77bba9f95c","block_type":"box","text":"at the time the security is issued, which may increase the effects of currency risk. As described below,","page_number":94,"box":{"x":116,"y":847,"width":763,"height":12}},{"id":"820a5f8f-8b8d-4144-bec4-e3a16b2ba4ed","block_type":"box","text":"a Fund is authorized to enter into foreign currency hedging transactions in which it may seek to reduce","page_number":94,"box":{"x":116,"y":862,"width":766,"height":12}},{"id":"6c85f0b5-1c80-4588-8f5e-7b9bab08b548","block_type":"box","text":"the effect of exchange rate fluctuations.","page_number":94,"box":{"x":116,"y":878,"width":298,"height":12}},{"id":"f5f72b02-9e73-41a2-a84b-8a1e9d2e86e9","block_type":"box","text":"II-7","page_number":94,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"11204f5c-d9a9-4055-808d-e71cb5dadb7c","block_type":"box","text":"NM1026U-6004382-94/605","page_number":94,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"a7b1553e-8fc0-49e3-8181-d06b6a669875","block_type":"box","text":"Apart from currency considerations, the value of convertible securities is influenced by both the yield","page_number":95,"box":{"x":116,"y":87,"width":749,"height":12}},{"id":"008afffe-59a9-42fe-a247-70c21f4d0734","block_type":"box","text":"on nonconvertible securities of comparable issuers and by the value of the underlying common stock.","page_number":95,"box":{"x":116,"y":102,"width":757,"height":13}},{"id":"45755cd1-d487-4598-a1b0-4531ebae30c7","block_type":"box","text":"The value of a convertible security viewed without regard to its conversion feature (","page_number":95,"box":{"x":116,"y":118,"width":617,"height":12}},{"id":"38b14b76-76a0-41ed-b97d-24ec1ce2bfe2","block_type":"box","text":"i.e.","page_number":95,"box":{"x":734,"y":118,"width":20,"height":10}},{"id":"66cd6f4f-7fa9-4d6b-96b2-24b6284fc35e","block_type":"box","text":", strictly on the","page_number":95,"box":{"x":757,"y":118,"width":112,"height":12}},{"id":"b994ef88-ce40-449d-95cf-a32495415b9f","block_type":"box","text":"basis of its yield) is sometimes referred to as its “investment value.” To the extent interest rates","page_number":95,"box":{"x":117,"y":134,"width":709,"height":12}},{"id":"ec977d01-1534-46b3-b33d-0e6d6e30d572","block_type":"box","text":"change, the investment value of the convertible security typically will fluctuate. At the same time,","page_number":95,"box":{"x":116,"y":149,"width":720,"height":12}},{"id":"21656508-e5f6-408b-bda0-efacba43392f","block_type":"box","text":"however, the value of the convertible security will be influenced by its “conversion value,” which is the","page_number":95,"box":{"x":117,"y":165,"width":756,"height":12}},{"id":"10fae932-8230-42ad-99ef-3cca2b50cad4","block_type":"box","text":"market value of the underlying common stock that would be obtained if the convertible security were","page_number":95,"box":{"x":117,"y":180,"width":747,"height":12}},{"id":"6023c7dc-2a03-42e0-a84e-c55543d2c603","block_type":"box","text":"converted. Conversion value fluctuates directly with the price of the underlying common stock. If the","page_number":95,"box":{"x":116,"y":196,"width":746,"height":12}},{"id":"8c2af6e5-6976-43ba-9317-dc0c79ea01ed","block_type":"box","text":"conversion value of a convertible security is substantially below its investment value, the price of the","page_number":95,"box":{"x":116,"y":211,"width":748,"height":12}},{"id":"d090c777-da0a-48aa-ac55-4dccc0d827b4","block_type":"box","text":"convertible security is governed principally by its investment value. To the extent the conversion value","page_number":95,"box":{"x":116,"y":227,"width":761,"height":12}},{"id":"156c4542-7092-4f0e-82b1-b001a049e560","block_type":"box","text":"of a convertible security increases to a point that approximates or exceeds its investment value, the","page_number":95,"box":{"x":116,"y":242,"width":743,"height":12}},{"id":"03a4b245-f3af-4195-b976-728f3199907e","block_type":"box","text":"price of the convertible security will be influenced principally by its conversion value. A convertible","page_number":95,"box":{"x":117,"y":258,"width":729,"height":12}},{"id":"55182f00-c69d-41c8-b7c0-4ebade48d2f1","block_type":"box","text":"security will sell at a premium over the conversion value to the extent investors place value on the right","page_number":95,"box":{"x":116,"y":273,"width":768,"height":12}},{"id":"e14f35e1-1f43-409b-a67b-5cd6a3b0e396","block_type":"box","text":"to acquire the underlying common stock while holding a fixed-income security. The yield and","page_number":95,"box":{"x":116,"y":289,"width":691,"height":12}},{"id":"514624e9-2b11-4ed5-99ec-c9f9f1df07c8","block_type":"box","text":"conversion premium of convertible securities issued in Japan and the Euromarket are frequently","page_number":95,"box":{"x":116,"y":304,"width":718,"height":12}},{"id":"6717dbde-719f-4a14-90db-868331cdfe54","block_type":"box","text":"determined at levels that cause the conversion value to affect their market value more than the","page_number":95,"box":{"x":116,"y":320,"width":708,"height":9}},{"id":"2557e891-f310-45c7-bb04-c0276ae4b8f9","block_type":"box","text":"securities’ investment value.","page_number":95,"box":{"x":116,"y":335,"width":215,"height":10}},{"id":"cbe6cacc-32bb-4de3-947d-53734b25f72b","block_type":"box","text":"Holders of convertible securities generally have a claim on the assets of the issuer prior to the common","page_number":95,"box":{"x":117,"y":362,"width":770,"height":12}},{"id":"d967b7a3-02f9-437a-a6e0-097a71fd69c0","block_type":"box","text":"stockholders but may be subordinated to other debt securities of the same issuer. A convertible","page_number":95,"box":{"x":116,"y":378,"width":713,"height":12}},{"id":"e4a7464c-f868-472e-b08a-65bea8ee4a42","block_type":"box","text":"security may be subject to redemption at the option of the issuer at a price established in a charter","page_number":95,"box":{"x":116,"y":393,"width":734,"height":12}},{"id":"593c15f7-7853-454b-bd1e-5cceec51598a","block_type":"box","text":"provision, indenture or other governing instrument pursuant to which the convertible security was","page_number":95,"box":{"x":117,"y":409,"width":723,"height":12}},{"id":"3f273b36-6bf0-4562-bea9-7cd66eee9a37","block_type":"box","text":"issued. If a convertible security held by a Fund is called for redemption, the Fund will be required to","page_number":95,"box":{"x":117,"y":424,"width":741,"height":12}},{"id":"83ebbac6-b693-4659-84f3-0fbd3b611ddd","block_type":"box","text":"redeem the security, convert it into the underlying common stock or sell it to a third party. Certain","page_number":95,"box":{"x":117,"y":440,"width":723,"height":12}},{"id":"024ebedc-ce78-4a18-9fc4-14afa97f9c86","block_type":"box","text":"convertible debt securities may provide a put option to the holder, which entitles the holder to cause","page_number":95,"box":{"x":116,"y":455,"width":745,"height":12}},{"id":"4d69cf36-d062-442f-bd96-ae2c0a9ae916","block_type":"box","text":"the security to be redeemed by the issuer at a premium over the stated principal amount of the debt","page_number":95,"box":{"x":116,"y":471,"width":745,"height":12}},{"id":"06b04604-4b85-497d-8d1b-095247ab3796","block_type":"box","text":"security under certain circumstances.","page_number":95,"box":{"x":116,"y":486,"width":282,"height":12}},{"id":"21d74536-0760-4c62-ac41-ddca708c8229","block_type":"box","text":"A Fund may also invest in synthetic convertible securities. Synthetic convertible securities may include","page_number":95,"box":{"x":116,"y":513,"width":765,"height":12}},{"id":"5413fb14-f00c-4394-8f03-d36db3758dbc","block_type":"box","text":"either Cash-Settled Convertibles or Manufactured Convertibles. “Cash-Settled Convertibles” are","page_number":95,"box":{"x":116,"y":529,"width":717,"height":9}},{"id":"ef220fc7-68a5-486c-b204-5acd25b3cdcf","block_type":"box","text":"instruments that are created by the issuer and have the economic characteristics of traditional","page_number":95,"box":{"x":117,"y":544,"width":701,"height":12}},{"id":"c8abbb65-3d85-49a9-a2f3-5fe33bac9654","block_type":"box","text":"convertible securities but may not actually permit conversion into the underlying equity securities in all","page_number":95,"box":{"x":116,"y":560,"width":760,"height":12}},{"id":"7151b448-da87-4767-a8f4-14301ad8120e","block_type":"box","text":"circumstances. As an example, a private company may issue a Cash-Settled Convertible that is","page_number":95,"box":{"x":116,"y":575,"width":715,"height":12}},{"id":"d273ac01-fd06-4fef-a601-82caa5f023a0","block_type":"box","text":"convertible into common stock only if the company successfully completes a public offering of its","page_number":95,"box":{"x":116,"y":591,"width":721,"height":12}},{"id":"5da24d6f-a820-4ac9-9ec3-c3480c7c64b5","block_type":"box","text":"common stock prior to maturity and otherwise pays a cash amount to reflect any equity appreciation.","page_number":95,"box":{"x":116,"y":606,"width":751,"height":12}},{"id":"af6feb2b-74e3-4383-9fbf-4ea9a5a35fb5","block_type":"box","text":"“Manufactured Convertibles” are created by the Manager or another party by combining separate","page_number":95,"box":{"x":116,"y":622,"width":726,"height":12}},{"id":"558f42c7-c509-40f1-9b0a-56c3263fe716","block_type":"box","text":"securities that possess one of the two principal characteristics of a convertible security,","page_number":95,"box":{"x":116,"y":637,"width":651,"height":12}},{"id":"3873bb97-4f18-4e98-99f4-96bd6b2292dc","block_type":"box","text":"i.e.","page_number":95,"box":{"x":767,"y":638,"width":21,"height":9}},{"id":"42628c0a-5d60-417a-879d-e9a1a08c01c4","block_type":"box","text":", fixed","page_number":95,"box":{"x":791,"y":637,"width":49,"height":12}},{"id":"ae48141e-f3f4-4cce-bb48-af28a1981f43","block_type":"box","text":"income (“fixed-income component”) or a right to acquire equity securities (“convertibility component”).","page_number":95,"box":{"x":117,"y":653,"width":756,"height":12}},{"id":"b9c50b4d-6ada-4e4c-bbd2-d2e930fad9ff","block_type":"box","text":"The fixed-income component is achieved by investing in nonconvertible fixed-income securities, such","page_number":95,"box":{"x":116,"y":668,"width":751,"height":12}},{"id":"67e3d54f-5fd8-4499-9154-0b0aeec026c1","block_type":"box","text":"as nonconvertible bonds, preferred stocks and money market instruments. The convertibility","page_number":95,"box":{"x":116,"y":684,"width":684,"height":12}},{"id":"d3a3cf55-1f9e-45db-ac3e-c71a0ac5401a","block_type":"box","text":"component is achieved by investing in call options, warrants, or other securities with equity conversion","page_number":95,"box":{"x":116,"y":700,"width":758,"height":12}},{"id":"e19bd9d6-3d76-4457-9ed5-cf8fe43e7573","block_type":"box","text":"features (“equity features”) granting the holder the right to purchase a specified quantity of the","page_number":95,"box":{"x":116,"y":715,"width":697,"height":12}},{"id":"15164b80-438c-4f0d-a99e-957f6f4c95d6","block_type":"box","text":"underlying stocks within a specified period of time at a specified price or, in the case of a stock index","page_number":95,"box":{"x":117,"y":730,"width":745,"height":13}},{"id":"38b640ad-14cf-4337-92ac-36fcb15cb391","block_type":"box","text":"option, the right to receive a cash payment based on the value of the underlying stock index.","page_number":95,"box":{"x":116,"y":746,"width":685,"height":12}},{"id":"210f66a4-26ab-4e42-acb8-9522a87bb9e3","block_type":"box","text":"A Manufactured Convertible differs from traditional convertible securities in several respects. Unlike a","page_number":95,"box":{"x":116,"y":773,"width":751,"height":12}},{"id":"171fd43a-1903-420d-9ed2-a6d4ed2dddb1","block_type":"box","text":"traditional convertible security, which is a single security that has a unitary market value, a","page_number":95,"box":{"x":116,"y":789,"width":669,"height":12}},{"id":"e214d232-6177-4974-bd2c-9bed7d702812","block_type":"box","text":"Manufactured Convertible is comprised of two or more separate securities, each with its own market","page_number":95,"box":{"x":117,"y":804,"width":742,"height":12}},{"id":"c71473ae-95b4-4958-b82d-0ce89556764d","block_type":"box","text":"value. Therefore, the total “market value” of such a Manufactured Convertible is the sum of the values","page_number":95,"box":{"x":116,"y":820,"width":755,"height":11}},{"id":"ee765cce-f747-4a4f-9a43-77f471e70553","block_type":"box","text":"of its fixed-income component and its convertibility component.","page_number":95,"box":{"x":116,"y":835,"width":472,"height":12}},{"id":"e89dddcb-e652-4cc9-b18b-3a39c40125cc","block_type":"box","text":"More flexibility is possible in the creation of a Manufactured Convertible than in the purchase of a","page_number":95,"box":{"x":117,"y":862,"width":724,"height":12}},{"id":"edb9fd81-eafd-4650-85b7-4e97d356ba98","block_type":"box","text":"traditional convertible security. Because many corporations have not issued convertible securities, the","page_number":95,"box":{"x":116,"y":878,"width":761,"height":12}},{"id":"518ee678-07e7-4a03-bc3e-a4a55faee695","block_type":"box","text":"II-8","page_number":95,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"75e5731e-087a-4ad7-aba4-bc0524d6b5ba","block_type":"box","text":"NM1026U-6004382-95/605","page_number":95,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"9a33e2b5-e830-4c9c-80bc-4a7e8695e2fd","block_type":"box","text":"Manager may combine a fixed-income instrument and an equity feature with respect to the stock of the","page_number":96,"box":{"x":117,"y":87,"width":767,"height":12}},{"id":"0832ca53-08bd-401d-b462-96eb4d0996e6","block_type":"box","text":"issuer of the fixed-income instrument to create a synthetic convertible security otherwise unavailable in","page_number":96,"box":{"x":117,"y":102,"width":767,"height":13}},{"id":"4b0ac6ce-27b7-46a4-99cd-054a3c2c4431","block_type":"box","text":"the market. The Manager may also combine a fixed-income instrument of an issuer with an equity","page_number":96,"box":{"x":116,"y":118,"width":731,"height":12}},{"id":"88b473fa-70d9-4d85-8693-de65486bb85f","block_type":"box","text":"feature with respect to the stock of a different issuer when the Manager believes such a Manufactured","page_number":96,"box":{"x":116,"y":134,"width":763,"height":12}},{"id":"fdf1236a-7d2b-4ea5-adea-788d151e75e9","block_type":"box","text":"Convertible would better promote a Fund’s objective than alternative investments. For example, the","page_number":96,"box":{"x":117,"y":149,"width":742,"height":12}},{"id":"5bbfb9d1-1327-47ca-896d-6bd692cde082","block_type":"box","text":"Manager may combine an equity feature with respect to an issuer’s stock with a fixed-income security","page_number":96,"box":{"x":117,"y":165,"width":759,"height":12}},{"id":"981fd732-e6ae-47e0-ac67-4ff4907b268c","block_type":"box","text":"of a different issuer in the same industry to diversify the Fund’s credit exposure, or with a U.S.","page_number":96,"box":{"x":116,"y":180,"width":702,"height":12}},{"id":"f3151f4a-ceac-4574-895c-3e601828dfb4","block_type":"box","text":"Treasury instrument to create a Manufactured Convertible with a higher credit profile than a traditional","page_number":96,"box":{"x":116,"y":196,"width":762,"height":12}},{"id":"1dd32ef5-e489-4764-ad48-48659fa0a779","block_type":"box","text":"convertible security issued by that issuer. A Manufactured Convertible also is a more flexible","page_number":96,"box":{"x":116,"y":211,"width":691,"height":12}},{"id":"2c798352-1f9d-456c-84c3-13c83ce7cc51","block_type":"box","text":"investment in that its two components may be purchased separately and, upon purchasing the","page_number":96,"box":{"x":117,"y":227,"width":704,"height":12}},{"id":"85305eda-85f7-4297-836d-93be45f97466","block_type":"box","text":"separate securities, “combined” to create a Manufactured Convertible. For example, the Fund may","page_number":96,"box":{"x":116,"y":242,"width":736,"height":12}},{"id":"b006f057-e65c-4305-bfb8-e7709f237628","block_type":"box","text":"purchase a warrant for eventual inclusion in a Manufactured Convertible while postponing the","page_number":96,"box":{"x":117,"y":258,"width":697,"height":12}},{"id":"e0573d93-a8f6-4159-8f5c-ffc2462cbc81","block_type":"box","text":"purchase of a suitable bond to pair with the warrant pending development of more favorable market","page_number":96,"box":{"x":117,"y":273,"width":743,"height":12}},{"id":"0e1f0558-6f08-444c-a793-c17b15866a2d","block_type":"box","text":"conditions.","page_number":96,"box":{"x":116,"y":289,"width":85,"height":9}},{"id":"54e6dfb6-5196-4dd1-9759-1cacc7143c23","block_type":"box","text":"The value of a Manufactured Convertible may respond to certain market fluctuations differently from a","page_number":96,"box":{"x":116,"y":320,"width":761,"height":12}},{"id":"4005815a-ee83-40d0-8393-5726f0443ae5","block_type":"box","text":"traditional convertible security with similar characteristics. For example, in the event a Fund created a","page_number":96,"box":{"x":116,"y":335,"width":758,"height":12}},{"id":"2826c8ee-2d59-42d3-b3ec-8eb18d64dafa","block_type":"box","text":"Manufactured Convertible by combining a short-term U.S. Treasury instrument and a call option on a","page_number":96,"box":{"x":117,"y":351,"width":752,"height":12}},{"id":"0e7547a8-8d7a-41fb-aa66-e07e32c5242a","block_type":"box","text":"stock, the Manufactured Convertible would be expected to outperform a traditional convertible of","page_number":96,"box":{"x":116,"y":366,"width":720,"height":12}},{"id":"07d5270e-7688-419a-b653-e7ebe717c018","block_type":"box","text":"similar maturity that is convertible into that stock during periods when Treasury instruments outperform","page_number":96,"box":{"x":116,"y":382,"width":767,"height":12}},{"id":"9a31c03a-4785-40e5-9262-e635e4cb9cf1","block_type":"box","text":"corporate fixed-income securities and underperform during periods when corporate fixed-income","page_number":96,"box":{"x":116,"y":397,"width":722,"height":12}},{"id":"67c60677-26b3-4da5-8496-5ddd54f9189b","block_type":"box","text":"securities outperform Treasury instruments.","page_number":96,"box":{"x":116,"y":413,"width":329,"height":12}},{"id":"c9ec2986-9a9e-43f6-a05e-972b5ae8c1f9","block_type":"box","text":"Corporate Loans.","page_number":96,"box":{"x":117,"y":444,"width":134,"height":12}},{"id":"2c93d244-c4e7-49fc-a800-5687929e6ec2","block_type":"box","text":"Certain Funds may invest in corporat","page_number":96,"box":{"x":252,"y":444,"width":274,"height":12}},{"id":"dd3b986b-1ba7-4005-9b53-d5e150d40cba","block_type":"box","text":"e loans. Corporate loans are generally","page_number":96,"box":{"x":527,"y":444,"width":282,"height":12}},{"id":"4eaf63d2-c10f-4890-9788-b0b31daf74bd","block_type":"box","text":"non-investment grade floating rate instruments. Usually","page_number":96,"box":{"x":117,"y":459,"width":401,"height":12}},{"id":"e194d237-7c8d-4cf7-b676-6f6e00389ddc","block_type":"box","text":", they are freely callable at the issuer’s option.","page_number":96,"box":{"x":520,"y":459,"width":336,"height":12}},{"id":"292efbf5-30f2-49c0-9167-943cf2719dc1","block_type":"box","text":"Certain Funds may invest in fixed and floating rate loans (“Loans”) arranged through private negotiations","page_number":96,"box":{"x":117,"y":475,"width":762,"height":12}},{"id":"fe13fe17-2eb0-4406-8b97-3fdb9d7484a7","block_type":"box","text":"between a corporate borrower or a foreign soverei","page_number":96,"box":{"x":117,"y":490,"width":363,"height":12}},{"id":"2aea979b-ae28-467c-b781-872e7cba076a","block_type":"box","text":"gn entity and one or more financial institutions or","page_number":96,"box":{"x":481,"y":490,"width":358,"height":12}},{"id":"5102cb4a-5763-4a8e-b7f6-666d7e87de8c","block_type":"box","text":"institutional investors (“Lenders”). A Fund may invest in","page_number":96,"box":{"x":117,"y":506,"width":399,"height":12}},{"id":"83831328-4033-4010-b7e5-107e332af105","block_type":"box","text":"such Loans in the form of participations in Loans","page_number":96,"box":{"x":517,"y":506,"width":362,"height":12}},{"id":"93738bfc-87c8-42f2-a48e-3473f88a166e","block_type":"box","text":"(“Participations”) and assignments of all or a porti","page_number":96,"box":{"x":117,"y":521,"width":356,"height":12}},{"id":"7be3684c-a7a5-4080-a075-fd23b100b3c2","block_type":"box","text":"on of Loans from third parties (“Assignments”). A Fund","page_number":96,"box":{"x":474,"y":521,"width":402,"height":12}},{"id":"b503a192-892a-4355-acff-abe8ceb24808","block_type":"box","text":"considers these investments to be investments in debt","page_number":96,"box":{"x":116,"y":537,"width":400,"height":9}},{"id":"592dbc1b-5833-47d8-8446-6250c4af3a03","block_type":"box","text":"securities for purposes of its investment policies.","page_number":96,"box":{"x":516,"y":537,"width":357,"height":12}},{"id":"6c3a7550-be8c-40f3-8b7e-b0afbac519e1","block_type":"box","text":"Participations typically will result in the Fund havi","page_number":96,"box":{"x":117,"y":552,"width":353,"height":12}},{"id":"fb063078-3281-46fb-b418-e6e03e443f73","block_type":"box","text":"ng a contractual relationship only with the Lender, not","page_number":96,"box":{"x":472,"y":552,"width":392,"height":12}},{"id":"bf150cbc-6726-44f0-9e88-c68267dc1bd4","block_type":"box","text":"with the borrower. The Fund will have the right to receive","page_number":96,"box":{"x":116,"y":568,"width":417,"height":12}},{"id":"13b32858-73fc-4843-aea0-04e21f1b47ac","block_type":"box","text":"payments of principal, interest and any fees to","page_number":96,"box":{"x":534,"y":568,"width":340,"height":12}},{"id":"67bdb3f4-88cb-4af5-968a-c677459d4ce9","block_type":"box","text":"which it is entitled only from the Lender selling t","page_number":96,"box":{"x":116,"y":583,"width":344,"height":12}},{"id":"72ef9b33-8c4e-4ef6-8369-9697a08f6484","block_type":"box","text":"he Participation and only upon receipt by the Lender of","page_number":96,"box":{"x":461,"y":583,"width":402,"height":12}},{"id":"fec5835f-60f9-4842-8cd5-1644d6bb5bba","block_type":"box","text":"the payments from the borrower. In connection wit","page_number":96,"box":{"x":116,"y":599,"width":365,"height":12}},{"id":"d70d1123-6f10-42f4-8a1b-3f90ad470b67","block_type":"box","text":"h purchasing Participations, the Fund generally will","page_number":96,"box":{"x":482,"y":599,"width":374,"height":12}},{"id":"053fd372-a6bb-4c72-8399-fd91493c2fdf","block_type":"box","text":"have no right to enforce compliance by the borrower w","page_number":96,"box":{"x":117,"y":614,"width":383,"height":12}},{"id":"0a8812aa-2233-470c-a202-f96daba8779b","block_type":"box","text":"with the terms of the loan agreement relating to the","page_number":96,"box":{"x":500,"y":614,"width":376,"height":12}},{"id":"2bb0b821-c5ac-48ff-804d-045a48d2303b","block_type":"box","text":"Loans, nor any rights of set-off against the borrower, and the Fund may not benefit directly from any","page_number":96,"box":{"x":117,"y":630,"width":729,"height":12}},{"id":"34d179cc-d23c-4888-8c99-8a613a3f4ebe","block_type":"box","text":"collateral supporting the Loan in which it has purc","page_number":96,"box":{"x":116,"y":645,"width":360,"height":12}},{"id":"0db3d6e1-1d98-4d06-9bbc-0467e5547659","block_type":"box","text":"hased the Participation. As a result, the Fund will","page_number":96,"box":{"x":477,"y":645,"width":359,"height":12}},{"id":"496dec8e-24bc-4013-b6f7-e48a9d1041ce","block_type":"box","text":"assume the credit risk of both the borrower and","page_number":96,"box":{"x":116,"y":661,"width":343,"height":9}},{"id":"2ba6a1e8-61d7-4f38-b071-3495932bfa6e","block_type":"box","text":"the Lender that is selling the Participation.","page_number":96,"box":{"x":465,"y":661,"width":303,"height":12}},{"id":"416f702b-3d38-4be1-82b5-9cfe4a44bd65","block_type":"box","text":"In the event of the insolvency of the Lender selling the Participation, the Fund may be treated as a","page_number":96,"box":{"x":117,"y":692,"width":727,"height":12}},{"id":"71dad994-77f9-441a-9d61-926b315da9bc","block_type":"box","text":"general creditor of the Lender and may not benefit from any set-off between the Lender and the","page_number":96,"box":{"x":116,"y":707,"width":709,"height":12}},{"id":"0017024a-8d9f-44e8-92b6-4099a3886be0","block_type":"box","text":"borrower. The Fund will acquire Participations only if the Lender interpositioned between the Fund and","page_number":96,"box":{"x":117,"y":723,"width":759,"height":12}},{"id":"69a88ef4-7ad8-4456-a028-84f6b76a7e09","block_type":"box","text":"the borrower is determined by the Fund’s manager to be creditworthy. When the Fund purchases","page_number":96,"box":{"x":116,"y":738,"width":721,"height":12}},{"id":"a25cbdbe-cb40-46c5-bcf0-2f6fe6a72655","block_type":"box","text":"Assignments from Lenders, the Fund will acquire direct rights against the borrower on the Loan, and","page_number":96,"box":{"x":116,"y":754,"width":743,"height":12}},{"id":"c5ba60c1-2997-46ac-bc38-93ac1a31327e","block_type":"box","text":"will not have exposure to a counterparty’s credit risk. The Funds may enter into Participations and","page_number":96,"box":{"x":116,"y":769,"width":725,"height":12}},{"id":"e7ebcdd5-defa-4b5a-b472-5de13222da84","block_type":"box","text":"Assignments on a forward commitment or “when-issued” basis, whereby a Fund would agree to","page_number":96,"box":{"x":116,"y":785,"width":709,"height":12}},{"id":"9ca1a1b5-5f3c-4b0d-b87c-0b5ee705f624","block_type":"box","text":"purchase a Participation or Assignment at set terms in the future. For more information on forward","page_number":96,"box":{"x":117,"y":800,"width":727,"height":12}},{"id":"b641f51e-bd96-4782-bfa1-5ab518ce5159","block_type":"box","text":"commitments and when-issued securities, see “When-Issued Securities, Delayed Delivery Securities","page_number":96,"box":{"x":116,"y":816,"width":746,"height":12}},{"id":"cafe6a88-7713-482a-ae5d-d64d43ab6b7a","block_type":"box","text":"and Forward Commitments” below. A Fund may have difficulty disposing of Assignments and","page_number":96,"box":{"x":116,"y":831,"width":697,"height":12}},{"id":"993d1a24-b9e3-4bc6-9ea2-51b801a1edb2","block_type":"box","text":"Participations. In certain cases, the market for such instruments may lack sufficient liquidity, and","page_number":96,"box":{"x":117,"y":847,"width":718,"height":12}},{"id":"5ff1c69f-1ed9-4c66-9183-17baa8434474","block_type":"box","text":"therefore the Fund anticipates that in such cases such instruments could be sold only to a limited","page_number":96,"box":{"x":116,"y":862,"width":725,"height":12}},{"id":"9383390f-acc6-4114-86f5-e44f7a315426","block_type":"box","text":"number of institutional investors. The lack of a sufficiently liquid secondary market may have an","page_number":96,"box":{"x":117,"y":878,"width":713,"height":12}},{"id":"c44a3a51-da9c-410e-9024-c55e976431b3","block_type":"box","text":"II-9","page_number":96,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"dd0b7b68-caef-4793-b222-58bd8f8cc179","block_type":"box","text":"NM1026U-6004382-96/605","page_number":96,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"8ad9907a-54f3-4270-84b5-12acdaa725ba","block_type":"box","text":"adverse impact on the value of such instruments and on the Fund’s ability to dispose of particular","page_number":97,"box":{"x":116,"y":87,"width":727,"height":12}},{"id":"ebee6ef8-055e-4580-8207-e82793ec0b55","block_type":"box","text":"Assignments or Participations in response to a specific economic event, such as deterioration in the","page_number":97,"box":{"x":116,"y":102,"width":745,"height":13}},{"id":"c8e79eb6-586e-46df-8661-8c8a31dcd0c5","block_type":"box","text":"creditworthiness of the borrower. Leading financial institutions often act as agent for a broader group of","page_number":97,"box":{"x":116,"y":118,"width":770,"height":12}},{"id":"9dd1b2e1-0cd9-4dfa-89fa-381a6f9f8dae","block_type":"box","text":"Lenders, generally referred to as a syndicate. The syndicate’s agent arranges the loans, holds","page_number":97,"box":{"x":117,"y":134,"width":703,"height":12}},{"id":"ceeb3b18-dd95-4693-800d-84565d468886","block_type":"box","text":"collateral and accepts payments of principal and interest. Failure by the syndicate agent to fulfill its","page_number":97,"box":{"x":116,"y":149,"width":736,"height":12}},{"id":"5221a55c-14d9-411b-b6e1-52139b8f1fc9","block_type":"box","text":"obligations may delay or adversely affect receipt of payment by the Fund.","page_number":97,"box":{"x":116,"y":165,"width":550,"height":12}},{"id":"04b0d0c1-01c5-4882-90b1-0a8d81f17e77","block_type":"box","text":"The Loans in which the Fund may invest are subject to the risk of loss of principal and income.","page_number":97,"box":{"x":116,"y":193,"width":706,"height":12}},{"id":"01719045-606f-4fdb-9cc8-292e3a5fd85f","block_type":"box","text":"Although borrowers frequently provide collateral to secure repayment of these obligations they do not","page_number":97,"box":{"x":116,"y":209,"width":757,"height":12}},{"id":"4d349865-a1cd-4d7a-a683-262f763f6034","block_type":"box","text":"always do so. If they do provide collateral, the value of the collateral may not completely cover the","page_number":97,"box":{"x":116,"y":224,"width":732,"height":12}},{"id":"e917c315-6e5a-48b2-9921-c9b065c041e6","block_type":"box","text":"borrower’s obligations at the time of a default. If a borrower files for protection from its creditors under","page_number":97,"box":{"x":117,"y":240,"width":757,"height":12}},{"id":"d243ecd5-b1c2-4c2b-9a76-4efda4eef691","block_type":"box","text":"the U.S. bankruptcy laws, these laws may limit a Fund’s rights to its collateral. In addition, the value of","page_number":97,"box":{"x":116,"y":255,"width":761,"height":12}},{"id":"ce5d9793-1d30-4f20-987a-0c54b4e307fc","block_type":"box","text":"collateral may erode during a bankruptcy case. In the event of a bankruptcy, the holder of a Loan may","page_number":97,"box":{"x":116,"y":271,"width":762,"height":12}},{"id":"75862b2b-5dda-4e0f-b2e9-91b840f5d4ed","block_type":"box","text":"not recover its principal, may experience a long delay in recovering its investment and may not receive","page_number":97,"box":{"x":117,"y":286,"width":765,"height":12}},{"id":"7ff8350d-3581-424d-a9ce-a1a1acefea5b","block_type":"box","text":"interest during the delay.","page_number":97,"box":{"x":117,"y":302,"width":188,"height":12}},{"id":"9344fcee-72ec-495e-8366-35370fd578aa","block_type":"box","text":"Transactions in corporate loans may settle on a delayed basis. As a result, the proceeds from the sale","page_number":97,"box":{"x":116,"y":331,"width":763,"height":12}},{"id":"229829d2-2863-48fa-9999-15da7763bfda","block_type":"box","text":"of corporate loans may not be readily available to make additional investments or to meet a Fund’s","page_number":97,"box":{"x":116,"y":346,"width":738,"height":12}},{"id":"05cafb67-5fa5-4c81-92a2-8c6f2fae060a","block_type":"box","text":"redemption obligations. To the extent the extended settlement process gives rise to short-term liquidity","page_number":97,"box":{"x":117,"y":362,"width":765,"height":12}},{"id":"477dbcc0-f7ab-46d9-ab3e-808f06aef404","block_type":"box","text":"needs, a Fund may hold additional cash, sell investments or temporarily borrow from banks and other","page_number":97,"box":{"x":117,"y":377,"width":758,"height":12}},{"id":"69f2e7a2-fd85-45dc-a08e-596252341877","block_type":"box","text":"lenders.","page_number":97,"box":{"x":117,"y":393,"width":63,"height":9}},{"id":"10a00ccc-1d4f-4ad3-b398-8b62096c4b51","block_type":"box","text":"In certain circumstances, Loans may not be deemed to be securities under certain federal securities","page_number":97,"box":{"x":117,"y":421,"width":746,"height":12}},{"id":"4a303b13-dda2-41f1-8010-4c11408d78a4","block_type":"box","text":"laws. Therefore, in the event of fraud or misrepresentation by a borrower or an arranger, Lenders and","page_number":97,"box":{"x":117,"y":437,"width":758,"height":12}},{"id":"78c2d94f-d880-491b-88c1-de71f9df5ebf","block_type":"box","text":"purchasers of interests in Loans, such as the Funds, may not have the protection of the anti-fraud","page_number":97,"box":{"x":117,"y":452,"width":729,"height":12}},{"id":"cc428385-d20b-485e-83cc-2ee55b67c06e","block_type":"box","text":"provisions of the federal securities laws as would otherwise be available for bonds or stocks. Instead,","page_number":97,"box":{"x":117,"y":468,"width":755,"height":12}},{"id":"9c7153a3-4c2b-4486-a79b-4b6121ea7591","block_type":"box","text":"in such cases, parties generally would rely on the contractual provisions in the Loan agreement itself","page_number":97,"box":{"x":117,"y":483,"width":750,"height":12}},{"id":"98293166-cea2-408d-8129-933cd3cc53ac","block_type":"box","text":"and common-law fraud protections under applicable state law.","page_number":97,"box":{"x":116,"y":499,"width":467,"height":12}},{"id":"ff4ca500-fa42-424f-8634-ed31070ca996","block_type":"box","text":"Direct Lending","page_number":97,"box":{"x":116,"y":528,"width":108,"height":12}},{"id":"f5025249-73cd-45f2-8c1b-54c23e02e206","block_type":"box","text":". The Fund may act as the originator for direct loans and engage in direct lending. Direct","page_number":97,"box":{"x":226,"y":528,"width":658,"height":12}},{"id":"ecf63a03-9553-4141-837b-e8c08a026b79","block_type":"box","text":"loans between the Fund and a borrower may not be administered by an underwriter or agent bank. The","page_number":97,"box":{"x":117,"y":543,"width":771,"height":12}},{"id":"7af66884-b840-44cf-a66b-455dea3c3914","block_type":"box","text":"Fund may provide financing to commercial borrowers directly or through companies acquired (or","page_number":97,"box":{"x":117,"y":559,"width":719,"height":12}},{"id":"cacb34d2-edb2-46e4-bafd-502aba5f4b8b","block_type":"box","text":"created) and owned by or otherwise affiliated with the Fund. The terms of the direct loans are","page_number":97,"box":{"x":116,"y":574,"width":697,"height":12}},{"id":"5dc93ab6-83a2-45a8-a704-8f2429680d98","block_type":"box","text":"negotiated with borrowers in private transactions. Furthermore, a direct loan may be secured or","page_number":97,"box":{"x":117,"y":590,"width":712,"height":12}},{"id":"589d8b4f-9fc4-4d12-97b5-2f881e0506d3","block_type":"box","text":"unsecured.","page_number":97,"box":{"x":117,"y":605,"width":87,"height":10}},{"id":"f7fedb24-a729-4ab8-88f3-37aa40e63928","block_type":"box","text":"In determining whether to make a direct loan, the Fund will rely primarily upon the creditworthiness of","page_number":97,"box":{"x":117,"y":634,"width":755,"height":12}},{"id":"5ac9f2cd-9b6a-45be-bc6e-862a64326c4c","block_type":"box","text":"the borrower and/or any collateral for payment of interest and repayment of principal. The risks","page_number":97,"box":{"x":116,"y":649,"width":708,"height":12}},{"id":"a2c91af4-430a-4453-af85-1e7a639d5cc8","block_type":"box","text":"associated with direct loans are substantially similar to those associated with investing in corporate","page_number":97,"box":{"x":116,"y":665,"width":733,"height":12}},{"id":"7fe31e14-64e4-45ca-935c-228981555612","block_type":"box","text":"loans. In making a direct loan, the Fund is exposed to the risk that the borrower may default or become","page_number":97,"box":{"x":117,"y":680,"width":764,"height":12}},{"id":"b147aa06-56aa-416d-a0f1-297da03cdee4","block_type":"box","text":"insolvent and, consequently, that the Fund will lose money on the loan. Furthermore, direct loans may","page_number":97,"box":{"x":117,"y":696,"width":755,"height":12}},{"id":"5a83e4ce-b48a-4b1f-ba4e-792103d4f603","block_type":"box","text":"subject the Fund to liquidity and interest rate risk and certain direct loans may be deemed illiquid.","page_number":97,"box":{"x":116,"y":712,"width":720,"height":11}},{"id":"09c2762f-aa9e-430b-9932-fad9bc824af1","block_type":"box","text":"Direct loans are not publicly traded and may not have a secondary market. The lack of a secondary","page_number":97,"box":{"x":117,"y":727,"width":737,"height":12}},{"id":"0b3a510f-e353-4d68-bd24-934e63a045b2","block_type":"box","text":"market for direct loans may have an adverse impact on the ability of the Fund to dispose of a direct","page_number":97,"box":{"x":117,"y":742,"width":734,"height":12}},{"id":"2bf11c03-f165-4bbf-964e-bac115814db2","block_type":"box","text":"loan and/or to value the direct loan.","page_number":97,"box":{"x":117,"y":758,"width":260,"height":10}},{"id":"39039a8c-1534-4992-b774-76bbec25a9c1","block_type":"box","text":"When engaging in direct lending, the Fund’s performance may depend, in part, on the ability of the","page_number":97,"box":{"x":116,"y":787,"width":731,"height":12}},{"id":"0b9f1ccc-28f5-4ae2-8157-5c1d7c8c630c","block_type":"box","text":"Fund to originate loans on advantageous terms. In originating loans, the Fund will compete with a","page_number":97,"box":{"x":117,"y":802,"width":722,"height":12}},{"id":"f8686fcf-ad84-41b7-b531-4c522ec26d57","block_type":"box","text":"broad spectrum of lenders. Increased competition for, or a diminishment in the available supply of,","page_number":97,"box":{"x":117,"y":818,"width":727,"height":12}},{"id":"c353c712-d024-47e4-9d44-cce87fa1925e","block_type":"box","text":"qualifying loans could result in lower yields on such loans, which could reduce Fund performance.","page_number":97,"box":{"x":116,"y":833,"width":730,"height":12}},{"id":"57e7e73f-8648-4b11-b6c1-e4d259194809","block_type":"box","text":"As part of its lending activities, the Fund may originate loans to companies that are experiencing","page_number":97,"box":{"x":116,"y":862,"width":719,"height":12}},{"id":"c8791fb1-1c0d-446a-85b1-33bdeef434fb","block_type":"box","text":"significant financial or business difficulties, including companies involved in bankruptcy or other","page_number":97,"box":{"x":116,"y":877,"width":710,"height":12}},{"id":"03aee22d-93fe-4b8a-8c33-741023dc9abb","block_type":"box","text":"II-10","page_number":97,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"7496b6f0-f20d-43e2-a4d8-70bb5a598790","block_type":"box","text":"NM1026U-6004382-97/605","page_number":97,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"7ebb56f1-9937-4d01-893e-67b6c67b273e","block_type":"box","text":"reorganization and liquidation proceedings. Although the terms of such financing may result in","page_number":98,"box":{"x":117,"y":87,"width":701,"height":12}},{"id":"1d05ba31-3b10-4e3f-a9c5-09f3a909fa86","block_type":"box","text":"significant financial returns to the Fund, they involve a substantial degree of risk. The level of analytical","page_number":98,"box":{"x":116,"y":102,"width":768,"height":13}},{"id":"7a969e1b-e1d5-49b2-a8f0-156ab10080ad","block_type":"box","text":"sophistication, both financial and legal, necessary for successful financing to companies experiencing","page_number":98,"box":{"x":116,"y":118,"width":758,"height":12}},{"id":"cfc73391-aee5-46ef-82a4-4e8d29cfb7e8","block_type":"box","text":"significant business and financial difficulties is unusually high.","page_number":98,"box":{"x":116,"y":134,"width":461,"height":12}},{"id":"b9a501aa-13d8-4ae3-9a21-f7ee4644abb9","block_type":"box","text":"Credit Linked Securities.","page_number":98,"box":{"x":117,"y":162,"width":195,"height":10}},{"id":"49eafd57-dea8-464f-ab87-37714d34b957","block_type":"box","text":"Among the income producing securities in which a Fund may invest are","page_number":98,"box":{"x":313,"y":162,"width":541,"height":12}},{"id":"0bd7a808-bd19-465c-ad8d-bb04ea39f7df","block_type":"box","text":"credit linked securities, which are issued by a limited purpose trust or other vehicle that, in turn, invests","page_number":98,"box":{"x":116,"y":178,"width":768,"height":12}},{"id":"ad7d0c6f-c977-4e6a-a80d-24641698ef95","block_type":"box","text":"in a derivative instrument or basket of derivative instruments, such as credit default swaps, interest rate","page_number":98,"box":{"x":117,"y":193,"width":771,"height":12}},{"id":"496eb0dd-c393-4471-aa53-844fcd2a09a6","block_type":"box","text":"swaps and other securities, in order to provide exposure to certain fixed-income markets. For instance,","page_number":98,"box":{"x":116,"y":209,"width":768,"height":12}},{"id":"517f2de9-d76d-44c8-803e-4b8f72b6a7c9","block_type":"box","text":"a Fund may invest in credit linked securities as a cash management tool in order to gain exposure to a","page_number":98,"box":{"x":116,"y":224,"width":765,"height":12}},{"id":"9dbeae3b-7e7b-46bb-8245-e25274057ac8","block_type":"box","text":"certain market and/or to remain fully invested when more traditional income producing securities are","page_number":98,"box":{"x":116,"y":240,"width":748,"height":12}},{"id":"42ab74ac-802a-433e-a4cd-77828e2214d3","block_type":"box","text":"not available.","page_number":98,"box":{"x":117,"y":255,"width":103,"height":10}},{"id":"7e0cb2fd-0afd-4933-ab05-51d27cdaa4a1","block_type":"box","text":"Like an investment in a bond, investments in these credit linked securities represent the right to receive","page_number":98,"box":{"x":117,"y":284,"width":770,"height":12}},{"id":"f80d1fb1-0318-4ba7-8157-fc2282ea70cb","block_type":"box","text":"periodic income payments (in the form of distributions) and payment of principal at the end of the term","page_number":98,"box":{"x":117,"y":300,"width":761,"height":12}},{"id":"b3108881-fa49-476d-a4a0-b461b3c9e941","block_type":"box","text":"of the security.","page_number":98,"box":{"x":116,"y":315,"width":114,"height":12}},{"id":"f47e18de-6518-46b2-975d-ad9a9a0aeeea","block_type":"box","text":"However, these payments are conditioned on the issuer’s receipt of payments from, and the issuer’s","page_number":98,"box":{"x":117,"y":344,"width":748,"height":12}},{"id":"cfc7b212-b8f0-4a37-aa0f-b7187819ce3e","block_type":"box","text":"potential obligations to, the counterparties to the derivative instruments and other securities in which","page_number":98,"box":{"x":117,"y":359,"width":747,"height":12}},{"id":"dc6d5424-935e-47f3-8642-cdcf1fef941d","block_type":"box","text":"the issuer invests. For instance, the issuer may sell one or more credit default swaps, under which the","page_number":98,"box":{"x":116,"y":375,"width":762,"height":12}},{"id":"6c33e6c8-4f9c-40be-a383-2d8ba5378ddf","block_type":"box","text":"issuer would receive a stream of payments over the term of the swap agreements provided that no","page_number":98,"box":{"x":117,"y":390,"width":736,"height":12}},{"id":"d2ea0b39-9c68-4ee5-9311-6d4f794505f3","block_type":"box","text":"event of default has occurred with respect to the referenced debt obligation upon which the swap is","page_number":98,"box":{"x":116,"y":406,"width":741,"height":12}},{"id":"15d91124-a7a9-4c3e-9bb8-7f0d38853ced","block_type":"box","text":"based. If a default occurs, the stream of payments may stop and the issuer would be obligated to pay","page_number":98,"box":{"x":117,"y":421,"width":756,"height":12}},{"id":"870bce70-3f05-41d8-98c1-6c324d3ef120","block_type":"box","text":"the counterparty the par (or other agreed upon value) of the referenced debt obligation. This, in turn,","page_number":98,"box":{"x":116,"y":437,"width":749,"height":12}},{"id":"20960286-ab55-49de-bead-8460b2bb9a15","block_type":"box","text":"would reduce the amount of income and principal that","page_number":98,"box":{"x":116,"y":452,"width":404,"height":12}},{"id":"bb3a0d5d-7bc0-468d-a335-ce9f9e54a881","block_type":"box","text":"a Fund would receive. A Fund’s investments in","page_number":98,"box":{"x":521,"y":452,"width":351,"height":10}},{"id":"eb19581e-dd0f-4a63-bfe5-ee5940e2e4cc","block_type":"box","text":"these instruments are indirectly subject to the risks associated with derivative instruments, including,","page_number":98,"box":{"x":116,"y":468,"width":750,"height":12}},{"id":"6540f3a5-fb48-44ba-a426-38185e963cc0","block_type":"box","text":"among others, credit risk, default or similar event risk, counterparty risk, interest rate risk, leverage risk","page_number":98,"box":{"x":116,"y":483,"width":766,"height":12}},{"id":"66643b46-b03a-4143-a251-63f36600f9be","block_type":"box","text":"and management risk. It is also expected that the securities will be exempt from registration under the","page_number":98,"box":{"x":116,"y":499,"width":761,"height":12}},{"id":"985e6107-37c4-48a0-97a3-e6f765980e0e","block_type":"box","text":"Securities Act. Accordingly, there may be no established trading market for the securities and they may","page_number":98,"box":{"x":116,"y":514,"width":771,"height":12}},{"id":"2637f08e-5b97-4290-9250-71fbd8dd8097","block_type":"box","text":"constitute illiquid investments.","page_number":98,"box":{"x":116,"y":530,"width":227,"height":12}},{"id":"838fc4ed-12a6-4e28-aac1-25910ff7924f","block_type":"box","text":"Debt Securities.","page_number":98,"box":{"x":116,"y":559,"width":126,"height":9}},{"id":"026eba12-8462-4e2f-9ad8-b8c0d2b4ae3a","block_type":"box","text":"Debt securities, such as bonds, involve credit risk. This is the risk that the issuer will","page_number":98,"box":{"x":243,"y":559,"width":633,"height":11}},{"id":"4cdb68de-e88c-4883-b834-4ee9f2959668","block_type":"box","text":"not make timely payments of principal and interest. The degree of credit risk depends on the issuer’s","page_number":98,"box":{"x":117,"y":574,"width":751,"height":12}},{"id":"a7963d6f-a27d-4223-97d1-677d9728dd06","block_type":"box","text":"financial condition and on the terms of the debt securities. Changes in an issuer’s credit rating or the","page_number":98,"box":{"x":116,"y":590,"width":749,"height":12}},{"id":"358c84db-f14d-4561-8a24-55ab9c3e2ee8","block_type":"box","text":"market’s perception of an issuer’s creditworthiness may also affect the value of a Fund’s investment in","page_number":98,"box":{"x":117,"y":605,"width":763,"height":12}},{"id":"aaa00404-f19a-41fa-b719-6bfed6618e5a","block_type":"box","text":"that issuer. Credit risk is reduced to the extent a Fund limits its debt investments to U.S. Government","page_number":98,"box":{"x":116,"y":621,"width":754,"height":9}},{"id":"7f29d406-6c58-4e01-a1c3-73146ac8a561","block_type":"box","text":"Securities.","page_number":98,"box":{"x":116,"y":636,"width":83,"height":10}},{"id":"ff18706e-cdd4-4962-875e-711180eaaa79","block_type":"box","text":"All debt securities, however, are subject to interest rate risk. This is the risk that the value of the","page_number":98,"box":{"x":116,"y":665,"width":709,"height":12}},{"id":"42ab121a-6641-4058-9eb4-080b5e883e8e","block_type":"box","text":"security may fall when interest rates rise. If interest rates move sharply in a manner not anticipated by","page_number":98,"box":{"x":116,"y":680,"width":755,"height":12}},{"id":"1793a441-8c62-41ca-8268-8018f3ce1d3f","block_type":"box","text":"Fund management, a Fund’s investments in debt securities could be adversely affected and the Fund","page_number":98,"box":{"x":117,"y":696,"width":752,"height":12}},{"id":"fc7431a1-c1dc-499a-8963-804f979d4930","block_type":"box","text":"could lose money. In general, the market price of debt securities with longer maturities will go up or","page_number":98,"box":{"x":116,"y":711,"width":735,"height":12}},{"id":"54ecbb17-e243-4199-a0a4-58cddd2bb4a4","block_type":"box","text":"down more in response to changes in interest rates than will the market price of shorter-term debt","page_number":98,"box":{"x":116,"y":727,"width":725,"height":12}},{"id":"41f66f63-8e96-40dd-9c1a-8256a50b58a0","block_type":"box","text":"securities.","page_number":98,"box":{"x":116,"y":743,"width":74,"height":9}},{"id":"d5ca8406-ab09-4d28-9414-0f982efa608f","block_type":"box","text":"During periods of rising interest rates, the average life of certain fixed-income securities is extended","page_number":98,"box":{"x":117,"y":771,"width":738,"height":12}},{"id":"bb96beb3-1d35-463a-a75e-6bf915f29a5c","block_type":"box","text":"because of slower than expected principal payments. This may lock in a below-market interest rate and","page_number":98,"box":{"x":117,"y":787,"width":765,"height":12}},{"id":"ffc3ff33-e98e-47cd-be41-1e6d494dd062","block_type":"box","text":"extend the duration of these fixed-income securities, especially mortgage-related securities, making","page_number":98,"box":{"x":116,"y":802,"width":739,"height":12}},{"id":"6c7f3bc9-5516-40c8-88e1-faa5fd097765","block_type":"box","text":"them more sensitive to changes in interest rates. As a result, in a period of rising interest rates, these","page_number":98,"box":{"x":116,"y":818,"width":750,"height":12}},{"id":"16b72e08-068c-4e87-9445-d7fb1784be20","block_type":"box","text":"securities may exhibit additional volatility and lose value. This is known as extension risk.","page_number":98,"box":{"x":116,"y":833,"width":665,"height":12}},{"id":"39bbfa80-71ea-4554-8f18-1bc270a26c56","block_type":"box","text":"The value of fixed-income securities in the Funds can be expected to vary inversely with changes in","page_number":98,"box":{"x":116,"y":862,"width":745,"height":12}},{"id":"0c7683d2-fe79-4d53-a6eb-71eae8f29042","block_type":"box","text":"prevailing interest rates. Fixed-income securities with longer maturities, which tend to produce higher","page_number":98,"box":{"x":117,"y":878,"width":753,"height":11}},{"id":"015b03b1-8ab2-4abe-9464-0807a91d72e2","block_type":"box","text":"II-11","page_number":98,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"c2dc8948-3d04-463a-b6c1-8c0d2df963c7","block_type":"box","text":"NM1026U-6004382-98/605","page_number":98,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"eea007ea-75ee-432b-a6e8-04d2f3c74ed0","block_type":"box","text":"yields, are subject to potentially greater capital appreciation and depreciation than securities with","page_number":99,"box":{"x":116,"y":87,"width":723,"height":12}},{"id":"ce1a0730-cc7e-47b6-ad61-559783bf3865","block_type":"box","text":"shorter maturities. The Funds are not restricted to any maximum or minimum time to maturity in","page_number":99,"box":{"x":116,"y":103,"width":714,"height":12}},{"id":"de9663ea-6f11-4751-802e-be2220c4fa3f","block_type":"box","text":"purchasing individual portfolio securities, and the average maturity of a Fund’s assets will vary.","page_number":99,"box":{"x":117,"y":118,"width":707,"height":12}},{"id":"39dc1ab2-5059-4728-868b-f876026629f0","block_type":"box","text":"Floating and Variable Rate Securities.","page_number":99,"box":{"x":116,"y":149,"width":280,"height":12}},{"id":"d7e3740f-7ec4-4868-a9e7-3401cb39a479","block_type":"box","text":"Certain Funds may invest in debt instruments that pay a variable","page_number":99,"box":{"x":398,"y":149,"width":490,"height":12}},{"id":"0077927b-d858-4328-a527-07edddb7d05b","block_type":"box","text":"coupon rate. Securities with floating or variable interest rates can be less sensitive to interest rate","page_number":99,"box":{"x":116,"y":165,"width":728,"height":12}},{"id":"496f4e17-16ca-44e5-86ab-c3770f4a7480","block_type":"box","text":"changes than securities with fixed interest rates, but may decline in value if their interest rates do not","page_number":99,"box":{"x":116,"y":180,"width":752,"height":12}},{"id":"8890e4f5-75c0-45c8-8f2b-d0f3945e6bee","block_type":"box","text":"rise as much, or as quickly, as interest rates in general. Conversely, floating rate securities will not","page_number":99,"box":{"x":117,"y":196,"width":732,"height":12}},{"id":"3fca83e7-c9d1-4a91-9fed-bf2a24ad4721","block_type":"box","text":"generally increase in value if interest rates decline. The","page_number":99,"box":{"x":116,"y":211,"width":415,"height":12}},{"id":"7b105f74-78ae-4c32-b51c-81a0e8df2145","block_type":"box","text":"impact of interest rate changes on floating rate","page_number":99,"box":{"x":532,"y":211,"width":350,"height":12}},{"id":"10923346-663c-4e1a-9452-71a5c283a3ce","block_type":"box","text":"investments is typically mitigated by the periodic interest rate reset of the investments. Benchmark","page_number":99,"box":{"x":117,"y":227,"width":733,"height":12}},{"id":"99b2bc25-a467-4e84-ab98-ef37d155d5ed","block_type":"box","text":"interest rates used for floating and variable rate securities may not accurately track market interest","page_number":99,"box":{"x":117,"y":242,"width":734,"height":12}},{"id":"18cb0ece-f712-44c3-b46f-c9fb499cea72","block_type":"box","text":"rates.","page_number":99,"box":{"x":117,"y":258,"width":45,"height":9}},{"id":"610cbe4c-ade3-4666-9684-9806398a3dbf","block_type":"box","text":"Inflation-Indexed Bonds.","page_number":99,"box":{"x":117,"y":289,"width":179,"height":9}},{"id":"3cd02a1f-86a4-45c6-bf26-364cc6c763be","block_type":"box","text":"Certain Funds may invest in inflation-indexed bonds, which are fixed-income","page_number":99,"box":{"x":297,"y":289,"width":577,"height":12}},{"id":"94e21afe-d402-4e78-bf2b-4e7519fa73bb","block_type":"box","text":"securities or other instruments whose principal value is periodically adjusted according to the rate of","page_number":99,"box":{"x":116,"y":304,"width":746,"height":12}},{"id":"b2d3c641-d9ad-4b72-8e86-71c8e675d471","block_type":"box","text":"inflation. Two structures are common. The U.S. Treasury and some other issuers use a structure that","page_number":99,"box":{"x":117,"y":320,"width":755,"height":12}},{"id":"d2617d74-babd-47f5-b9ff-afdfdeb43b0b","block_type":"box","text":"accrues inflation into the principal value of the bond. Most other issuers pay out the Consumer Price","page_number":99,"box":{"x":116,"y":335,"width":747,"height":12}},{"id":"97b1261c-f7b9-4112-9afa-e4ab60ff47e2","block_type":"box","text":"Index (“CPI”) accruals as part of a semi-annual coupon.","page_number":99,"box":{"x":117,"y":351,"width":417,"height":12}},{"id":"5ff66b60-0108-4dd7-906a-1f5f59480e50","block_type":"box","text":"Inflation-indexed securities issued by the U.S. Treasury have maturities of five, ten or thirty years,","page_number":99,"box":{"x":117,"y":382,"width":728,"height":12}},{"id":"2c4ae5b9-ef06-47d8-83e7-dcfeb6bbff2b","block_type":"box","text":"although it is possible that securities with other maturities will be issued in the future. The U.S.","page_number":99,"box":{"x":116,"y":397,"width":703,"height":12}},{"id":"a0b43a2b-8627-4236-b394-f7de02c7f0a8","block_type":"box","text":"Treasury securities pay interest on a semi-annual basis, equal to a fixed percentage of the inflation","page_number":99,"box":{"x":116,"y":413,"width":738,"height":12}},{"id":"8a7d7a25-3a1f-43a0-a2c5-ad5d3cb22eb2","block_type":"box","text":"adjusted principal amount. For example, if a Fund purchased an inflation-indexed bond with a par","page_number":99,"box":{"x":116,"y":428,"width":727,"height":12}},{"id":"2a75cba2-9f05-4f91-b008-cff88281e602","block_type":"box","text":"value of $1,000 and a 3% real rate of return coupon (payable 1.5% semi-annually), and inflation over","page_number":99,"box":{"x":116,"y":443,"width":753,"height":13}},{"id":"f116b761-75e0-4dc8-9862-5900e693e901","block_type":"box","text":"the first six months was 1%, the mid-year par value of the bond would be $1,010 and the first semi","page_number":99,"box":{"x":116,"y":458,"width":736,"height":13}},{"id":"2204215a-00eb-4944-9a16-d74d2a562154","block_type":"box","text":"annual interest payment would be $15.15 ($1,010 times 1.5%). If inflation during the second half of the","page_number":99,"box":{"x":116,"y":474,"width":766,"height":13}},{"id":"2d17a596-eb07-48f3-96e2-5ff34c19618c","block_type":"box","text":"year resulted in the whole year’s inflation equaling 3%, the end-of-year par value of the bond would be","page_number":99,"box":{"x":116,"y":490,"width":764,"height":12}},{"id":"9b8a4a1d-6f54-4fa5-9ef2-89809777042b","block_type":"box","text":"$1,030 and the second semi-annual interest payment would be $15.45 ($1,030 times 1.5%).","page_number":99,"box":{"x":116,"y":505,"width":689,"height":13}},{"id":"52db3357-dedd-4576-b309-96c0c9a36f29","block_type":"box","text":"If the periodic adjustment rate measuring inflation falls, the principal value of inflation-indexed bonds","page_number":99,"box":{"x":117,"y":537,"width":747,"height":12}},{"id":"2c3f7ca4-30da-41db-ade9-af184e611f6a","block_type":"box","text":"will be adjusted downward, and, consequently, the interest payable on these securities (calculated with","page_number":99,"box":{"x":116,"y":552,"width":769,"height":12}},{"id":"5c814e2a-d6c6-4093-8545-a95f1fd43007","block_type":"box","text":"respect to a smaller principal amount) will be reduced. Repayment of the original bond principal upon","page_number":99,"box":{"x":117,"y":568,"width":754,"height":12}},{"id":"6becb369-4e95-47f8-bffc-d27913dc1291","block_type":"box","text":"maturity (as adjusted for inflation) is guaranteed in the case of U.S. Treasury inflation-indexed bonds,","page_number":99,"box":{"x":117,"y":583,"width":755,"height":12}},{"id":"fe34c741-31d2-4c3d-9fcb-8c522f93c797","block_type":"box","text":"even during a period of deflation. However, the current market value of the bonds is not guaranteed,","page_number":99,"box":{"x":116,"y":599,"width":748,"height":12}},{"id":"01e395ca-7b2b-4dfb-8eeb-97cdc53b5646","block_type":"box","text":"and will fluctuate. Certain Funds may also invest in other inflation related bonds which may or may not","page_number":99,"box":{"x":116,"y":614,"width":763,"height":12}},{"id":"269f9264-efe3-4f85-ab33-be0fdae1231b","block_type":"box","text":"provide a similar guarantee. If a guarantee of principal is not provided, the adjusted principal value of","page_number":99,"box":{"x":117,"y":630,"width":752,"height":12}},{"id":"c6a93edc-db83-4058-a53a-1aa15fdc449b","block_type":"box","text":"the bond repaid at maturity may be less than the original principal. In addition, if the Fund purchases","page_number":99,"box":{"x":116,"y":645,"width":749,"height":12}},{"id":"4c8046a1-3101-4984-b6c6-462c6e6fdcf4","block_type":"box","text":"inflation-indexed bonds offered by foreign issuers, the rate of inflation measured by the foreign inflation","page_number":99,"box":{"x":117,"y":661,"width":761,"height":12}},{"id":"048ec840-1e2c-4049-bd75-4edb019f3876","block_type":"box","text":"index may not be correlated to the rate of inflation in the United States.","page_number":99,"box":{"x":117,"y":676,"width":523,"height":12}},{"id":"2f4d8d32-420b-4589-aa7b-a399be1393fc","block_type":"box","text":"The value of inflation-indexed bonds is expected to change in response to changes in real interest","page_number":99,"box":{"x":116,"y":707,"width":727,"height":12}},{"id":"c4d02806-b863-4eaf-a3c3-10b5a9acff5c","block_type":"box","text":"rates. Real interest rates, in turn, are tied to the relationship between nominal interest rates and the","page_number":99,"box":{"x":117,"y":723,"width":736,"height":12}},{"id":"0cc740a4-8004-4bd0-bc23-9401237c8036","block_type":"box","text":"rate of inflation. Therefore, if inflation were to rise at a faster rate than nominal interest rates, real","page_number":99,"box":{"x":117,"y":738,"width":717,"height":11}},{"id":"289acde9-c0a5-4c72-be98-6c41cbcd5116","block_type":"box","text":"interest rates might decline, leading to an increase in value of inflation-indexed bonds. In contrast, if","page_number":99,"box":{"x":117,"y":754,"width":739,"height":12}},{"id":"6dad311a-9f0f-4fda-a3ca-d16455c7f8e8","block_type":"box","text":"nominal interest rates increased at a faster rate than inflation, real interest rates might rise, leading to a","page_number":99,"box":{"x":117,"y":769,"width":764,"height":12}},{"id":"02ab34f2-ac0f-42f9-92f6-2473ccf90681","block_type":"box","text":"decrease in value of inflation-indexed bonds. There can be no assurance, however, that the value of","page_number":99,"box":{"x":116,"y":785,"width":745,"height":11}},{"id":"2eb118b6-a636-4be1-9541-c548495a1c5e","block_type":"box","text":"inflation-indexed bonds will be directly correlated to changes in interest rates.","page_number":99,"box":{"x":117,"y":800,"width":570,"height":12}},{"id":"2c6fcf02-70cf-488a-a4d7-13dc9382c9d3","block_type":"box","text":"While these securities are expected to be protected from long-term inflationary trends, short-term","page_number":99,"box":{"x":116,"y":831,"width":725,"height":12}},{"id":"cf90557f-56fd-4b9a-9231-16f47c002175","block_type":"box","text":"increases in inflation may lead to a decline in value. If interest rates rise due to reasons other than","page_number":99,"box":{"x":117,"y":847,"width":731,"height":12}},{"id":"b43d5594-b7b1-4782-ad2c-1f16c954d0a3","block_type":"box","text":"inflation (for example, due to changes in currency exchange rates), investors in these securities may","page_number":99,"box":{"x":117,"y":862,"width":749,"height":12}},{"id":"963318f0-3aad-4857-80ba-0f27b5c586ca","block_type":"box","text":"not be protected to the extent that the increase is not reflected in the bond’s inflation measure.","page_number":99,"box":{"x":117,"y":878,"width":704,"height":12}},{"id":"dde8766d-c01e-4586-8a22-b7cb9eca44fb","block_type":"box","text":"II-12","page_number":99,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"59220b5b-9401-4d00-b724-415df1a09df8","block_type":"box","text":"NM1026U-6004382-99/605","page_number":99,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"8efb41c3-bb25-4f99-9979-512f2aad9c0d","block_type":"box","text":"In general, the measure used to determine the periodic adjustment of U.S. inflation-indexed bonds is","page_number":100,"box":{"x":117,"y":87,"width":750,"height":12}},{"id":"05e1d844-d097-49e1-80ab-41874bf77ac1","block_type":"box","text":"the Consumer Price Index for Urban Consumers (“CPI-U”), which is calculated monthly by the U.S.","page_number":100,"box":{"x":116,"y":102,"width":739,"height":13}},{"id":"d1699613-083e-4328-afc7-3b181287538a","block_type":"box","text":"Bureau of Labor Statistics. The CPI-U is a measurement of changes in the cost of living, made up of","page_number":100,"box":{"x":117,"y":118,"width":747,"height":12}},{"id":"b47744ba-05b5-4cd6-912c-928a929d176c","block_type":"box","text":"components such as housing, food, transportation and energy. Inflation-indexed bonds issued by a","page_number":100,"box":{"x":116,"y":134,"width":739,"height":12}},{"id":"7b1ad348-e254-44de-829d-8a1f177441e8","block_type":"box","text":"foreign government are generally adjusted to reflect a comparable inflation index, calculated by that","page_number":100,"box":{"x":116,"y":149,"width":743,"height":12}},{"id":"c9e718b1-417d-4ea9-a6ae-8b72d6b1e063","block_type":"box","text":"government. There can be no assurance that the CPI-U or any foreign inflation index will accurately","page_number":100,"box":{"x":116,"y":165,"width":744,"height":12}},{"id":"6bbdcebf-9a8a-4688-83eb-8a72fb9559cf","block_type":"box","text":"measure the real rate of inflation in the prices of goods and services. Moreover, there can be no","page_number":100,"box":{"x":117,"y":180,"width":716,"height":12}},{"id":"43e44be0-ecb9-42f6-9c96-4914f84dea1a","block_type":"box","text":"assurance that the rate of inflation in a foreign country will be correlated to the rate of inflation in the","page_number":100,"box":{"x":116,"y":196,"width":745,"height":12}},{"id":"8ae9c327-dd10-4e9e-b299-d795278859b0","block_type":"box","text":"United States.","page_number":100,"box":{"x":117,"y":211,"width":109,"height":10}},{"id":"10ebe814-35c1-444b-b7a4-82846ad4286f","block_type":"box","text":"Any increase in the principal amount of an inflation-indexed bond will be considered taxable ordinary","page_number":100,"box":{"x":116,"y":241,"width":750,"height":12}},{"id":"235baffc-66c8-4cca-a993-76ac9c773cd8","block_type":"box","text":"income, even though investors do not receive their principal until maturity.","page_number":100,"box":{"x":117,"y":257,"width":552,"height":12}},{"id":"97d47a30-98b4-4448-b5de-09028404e33a","block_type":"box","text":"Investment Grade Debt Obligations.","page_number":100,"box":{"x":117,"y":286,"width":265,"height":12}},{"id":"7359cf26-58a7-4f47-a6df-13a5e6d1c744","block_type":"box","text":"Certain Funds may invest in “investment grade securities,” which","page_number":100,"box":{"x":383,"y":286,"width":492,"height":12}},{"id":"f62c373c-4f21-4084-8f5e-9c241d158c0a","block_type":"box","text":"are securities rated in the four highest rating categories of an NRSRO or deemed to be of equivalent","page_number":100,"box":{"x":116,"y":302,"width":750,"height":12}},{"id":"9829ce61-3ee7-42e9-8685-1a7c329b3a7b","block_type":"box","text":"quality by a Fund’s Manager. Certain Funds may invest in debt securities rated Aaa by Moody’s or","page_number":100,"box":{"x":116,"y":317,"width":734,"height":12}},{"id":"3de055bc-3926-4943-ae3e-ae5a7325dc5e","block_type":"box","text":"AAA by S&P. It should be noted that debt obligations rated in the lowest of the top four ratings (","page_number":100,"box":{"x":116,"y":333,"width":708,"height":12}},{"id":"d8f8a167-d014-4f65-a1b0-7245a0868906","block_type":"box","text":"i.e.","page_number":100,"box":{"x":825,"y":333,"width":20,"height":9}},{"id":"bb731b1f-e158-4e3e-a216-cdc029172140","block_type":"box","text":",","page_number":100,"box":{"x":848,"y":341,"width":8,"height":3}},{"id":"2f5b993c-800d-4e39-9a94-44f163b6eb1d","block_type":"box","text":"“Baa” by Moody’s or “BBB” by S&P) are considered to have some speculative characteristics and are","page_number":100,"box":{"x":116,"y":348,"width":756,"height":12}},{"id":"a3777d8d-2244-4df8-af40-494ee55bdc7c","block_type":"box","text":"more sensitive to economic change than higher rated securities. If an investment grade security of a","page_number":100,"box":{"x":117,"y":364,"width":747,"height":12}},{"id":"0f030bfe-5200-48b1-9fba-2b3cd4e284dd","block_type":"box","text":"Fund is subsequently downgraded below investment grade, the Fund’s Manager will consider such an","page_number":100,"box":{"x":117,"y":380,"width":761,"height":11}},{"id":"954845a8-d4fc-47ca-b17d-019976213172","block_type":"box","text":"event in determining whether the Fund should continue to hold the security. Subject to its investment","page_number":100,"box":{"x":116,"y":395,"width":752,"height":12}},{"id":"a8d03f0a-e11c-44ae-a73a-7f9b2ac8e2e8","block_type":"box","text":"strategies, there is no limit on the amount of such downgraded securities a Fund may hold.","page_number":100,"box":{"x":116,"y":410,"width":679,"height":12}},{"id":"a7416a72-75f2-4b06-b99a-fc6ab17b5595","block_type":"box","text":"See Appendix A to this SAI for a description of applicable securities ratings.","page_number":100,"box":{"x":116,"y":440,"width":566,"height":12}},{"id":"bb3c796d-de8d-4c6d-8996-398ca6c2095d","block_type":"box","text":"High Yield Investments (“Junk Bonds”).","page_number":100,"box":{"x":116,"y":477,"width":296,"height":13}},{"id":"273cd743-80da-4182-8eee-a38e06c6cea2","block_type":"box","text":"Non-investment grade or “high yield” fixed-income or convertible securities commonly known to","page_number":100,"box":{"x":117,"y":507,"width":711,"height":12}},{"id":"4e2db22f-37c6-409b-a5e1-7223e8ae6dd8","block_type":"box","text":"investors as “junk bonds” are debt securities that are rated below investment grade by the major rating","page_number":100,"box":{"x":117,"y":523,"width":764,"height":12}},{"id":"101e685f-f55e-4f8f-8407-ad842d75f947","block_type":"box","text":"agencies or are securities that Fund management believes are of comparable quality. While generally","page_number":100,"box":{"x":116,"y":538,"width":759,"height":12}},{"id":"3bc5da1b-330b-4164-95cb-230d35691483","block_type":"box","text":"providing greater income and opportunity for gain, non-investment grade debt securities may be","page_number":100,"box":{"x":117,"y":554,"width":715,"height":12}},{"id":"8285cfe5-ed8f-4b83-a0c9-8391668be964","block_type":"box","text":"subject to greater risks than securities which have higher credit ratings, including a high risk of default,","page_number":100,"box":{"x":116,"y":569,"width":764,"height":12}},{"id":"7e87ef3c-69c3-4fdb-b074-f85e9b6e070e","block_type":"box","text":"and their yields will fluctuate over time. High yield securities will generally be in the lower rating","page_number":100,"box":{"x":116,"y":585,"width":709,"height":12}},{"id":"ac7e8bb7-b00b-458a-8a2c-a8af942409e4","block_type":"box","text":"categories of recognized rating agencies (rated “Ba” or lower by Moody’s or “BB” or lower by S&P) or","page_number":100,"box":{"x":116,"y":600,"width":755,"height":12}},{"id":"adf462c6-b746-4a1a-8b9c-3459600b4dc4","block_type":"box","text":"will be non-rated. The credit rating of a high yield security does not necessarily address its market","page_number":100,"box":{"x":116,"y":616,"width":730,"height":12}},{"id":"d76c4dbe-8578-4edd-ab75-eadd57891cae","block_type":"box","text":"value risk, and ratings may from time to time change, positively or negatively, to reflect developments","page_number":100,"box":{"x":116,"y":631,"width":757,"height":12}},{"id":"cafd3cab-e096-4d54-805a-5d7958b00aba","block_type":"box","text":"regarding the issuer’s financial condition. High yield securities are considered to be speculative with","page_number":100,"box":{"x":117,"y":647,"width":743,"height":12}},{"id":"421018ac-283d-4f8f-a7cd-6e8cfd3e171b","block_type":"box","text":"respect to the capacity of the issuer to timely repay principal and pay interest or dividends in","page_number":100,"box":{"x":117,"y":662,"width":682,"height":12}},{"id":"72d29629-6766-472c-9a6e-6f5a32e8ea7f","block_type":"box","text":"accordance with the terms of the obligation and may have more credit risk than higher rated securities.","page_number":100,"box":{"x":116,"y":678,"width":761,"height":12}},{"id":"4255594c-35c9-4663-9e3d-762ed3947f5b","block_type":"box","text":"The major risks in junk bond investments include the following:","page_number":100,"box":{"x":116,"y":708,"width":464,"height":12}},{"id":"f27278ca-9aff-4d75-a57f-e84446bf8cff","block_type":"box","text":"• Junk bonds may be issued by less creditworthy companies. These securities are vulnerable to","page_number":100,"box":{"x":117,"y":731,"width":731,"height":12}},{"id":"07a9a59c-8075-4cb6-972c-aa7a389acf94","block_type":"box","text":"adverse changes in the issuer’s industry and to general economic conditions. Issuers of junk","page_number":100,"box":{"x":150,"y":746,"width":686,"height":12}},{"id":"6cfead34-8253-4bb3-ad6d-0c5ccce1ad16","block_type":"box","text":"bonds may be unable to meet their interest or principal payment obligations because of an","page_number":100,"box":{"x":150,"y":761,"width":669,"height":13}},{"id":"666acad7-2f20-47a0-ad93-040d989959de","block_type":"box","text":"economic downturn, specific issuer developments or the unavailability of additional financing.","page_number":100,"box":{"x":150,"y":777,"width":689,"height":12}},{"id":"55339a58-9d9e-4efa-b035-eb8a4f97dae5","block_type":"box","text":"• The issuers of junk bonds may have a larger amount of outstanding debt relative to their assets","page_number":100,"box":{"x":117,"y":800,"width":740,"height":12}},{"id":"bf14f228-a787-4f08-9085-e6c2fa698768","block_type":"box","text":"than issuers of investment grade bonds. If the issuer experiences financial stress, it may be","page_number":100,"box":{"x":150,"y":815,"width":678,"height":12}},{"id":"df60111c-5cb2-4b9b-9ce5-07366789c735","block_type":"box","text":"unable to meet its debt obligations. The issuer’s ability to pay its debt obligations also may be","page_number":100,"box":{"x":150,"y":831,"width":697,"height":12}},{"id":"f90f15b4-a697-4d61-8546-481c6b0a7177","block_type":"box","text":"lessened by specific issuer developments, or the unavailability of additional financing. Issuers of","page_number":100,"box":{"x":150,"y":846,"width":717,"height":12}},{"id":"a56d1ea2-3797-432c-9814-207bb5e73eb6","block_type":"box","text":"high yield securities are often in the growth stage of their development and/or involved in a","page_number":100,"box":{"x":150,"y":862,"width":677,"height":12}},{"id":"1a263e21-4083-470f-a7c3-98804f25b56e","block_type":"box","text":"reorganization or takeover.","page_number":100,"box":{"x":150,"y":877,"width":204,"height":12}},{"id":"e070de32-1ba6-47b4-ad98-ab21623b4ddf","block_type":"box","text":"II-13","page_number":100,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"2828fced-aba4-4ac8-a95a-676e68d305c8","block_type":"box","text":"NM1026U-6004382-100/605","page_number":100,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9c863d26-c83b-4544-940e-7533c9f1f858","block_type":"box","text":"• Junk bonds are frequently ranked junior to claims by other creditors. If the issuer cannot meet its","page_number":101,"box":{"x":117,"y":87,"width":754,"height":12}},{"id":"9fb1d637-776d-41c7-9a17-9d037155f67a","block_type":"box","text":"obligations, the senior obligations are generally paid off before the junior obligations, which will","page_number":101,"box":{"x":150,"y":102,"width":706,"height":13}},{"id":"b649541d-661b-47fa-b958-56713dfa586f","block_type":"box","text":"potentially limit a Fund’s ability to fully recover principal or to receive interest payments when","page_number":101,"box":{"x":150,"y":118,"width":693,"height":12}},{"id":"71e37b2a-452c-46f1-96da-acaabfc16a67","block_type":"box","text":"senior securities are in default. Thus, investors in high yield securities have a lower degree of","page_number":101,"box":{"x":150,"y":134,"width":696,"height":12}},{"id":"c96e6731-b30d-491b-bb00-73fe7c9ab17f","block_type":"box","text":"protection with respect to principal and interest payments than do investors in higher rated","page_number":101,"box":{"x":150,"y":149,"width":674,"height":12}},{"id":"f5961da6-a3c1-4d5c-bb6f-3b625be23e82","block_type":"box","text":"securities.","page_number":101,"box":{"x":150,"y":165,"width":80,"height":9}},{"id":"578ce59f-1b1a-4a57-a1d6-17a1c04bb2ce","block_type":"box","text":"• Junk bonds frequently have redemption features that permit an issuer to repurchase the security","page_number":101,"box":{"x":117,"y":188,"width":753,"height":12}},{"id":"a1e52783-5b24-46c2-989a-22cdd7854cf2","block_type":"box","text":"from a Fund before it matures. If an issuer redeems the junk bonds, a Fund may have to invest the","page_number":101,"box":{"x":149,"y":203,"width":738,"height":12}},{"id":"8e433271-2ebe-4cc3-b9d1-1096053be7e2","block_type":"box","text":"proceeds in bonds with lower yields and may lose income.","page_number":101,"box":{"x":150,"y":219,"width":437,"height":12}},{"id":"36193721-1583-42fc-9a84-0dbd3ad214b2","block_type":"box","text":"• Prices of junk bonds are subject to extreme price fluctuations. Negative economic developments","page_number":101,"box":{"x":117,"y":242,"width":753,"height":12}},{"id":"e6f4c2ae-5fa4-48d6-bc0e-5e255b6028d4","block_type":"box","text":"may have a greater impact on the prices of junk bonds than on those of other higher rated fixed","page_number":101,"box":{"x":150,"y":258,"width":713,"height":12}},{"id":"265368ae-ff5c-4616-97d1-5ff9efb27e00","block_type":"box","text":"income securities.","page_number":101,"box":{"x":150,"y":273,"width":139,"height":10}},{"id":"2bfd5550-21c0-42c3-909d-df28fe5b789e","block_type":"box","text":"• Junk bonds may be less liquid than higher rated fixed-income securities even under normal","page_number":101,"box":{"x":117,"y":296,"width":714,"height":12}},{"id":"d8f0f287-34ac-4a81-9c7b-ff3f8e19aaff","block_type":"box","text":"economic conditions. Under certain economic and/or market conditions, a Fund may have difficulty","page_number":101,"box":{"x":150,"y":312,"width":738,"height":12}},{"id":"2ae7da38-7934-43c2-aebe-6e4e5eb1d4f7","block_type":"box","text":"disposing of certain high yield securities due to the limited number of investors in that sector of the","page_number":101,"box":{"x":150,"y":327,"width":734,"height":12}},{"id":"5bdcaf26-8e0f-4975-9f10-b6cc3e742b8a","block_type":"box","text":"market. There are fewer dealers in the junk bond market, and there may be significant differences","page_number":101,"box":{"x":150,"y":343,"width":730,"height":12}},{"id":"2a6ed785-8e63-43af-ac5e-ec0194323c11","block_type":"box","text":"in the prices quoted for junk bonds by the dealers, and such quotations may not be the actual","page_number":101,"box":{"x":150,"y":358,"width":698,"height":12}},{"id":"619dc534-844e-402a-a0f2-175bd136ebfd","block_type":"box","text":"prices available for a purchase or sale. Because junk bonds are less liquid than higher rated","page_number":101,"box":{"x":150,"y":374,"width":688,"height":12}},{"id":"e5a6a359-5499-4c4b-a3b1-d8db6dfc2904","block_type":"box","text":"bonds, judgment may play a greater role in valuing certain of a Fund’s portfolio securities than in","page_number":101,"box":{"x":150,"y":389,"width":720,"height":12}},{"id":"568a0a3e-c55c-4a87-be74-e47084aab9b9","block_type":"box","text":"the case of securities trading in a more liquid market.","page_number":101,"box":{"x":150,"y":405,"width":398,"height":12}},{"id":"fb3af8e1-1477-476e-9617-76d237265c61","block_type":"box","text":"• The secondary markets for high yield securities are not as liquid as the secondary markets for","page_number":101,"box":{"x":117,"y":428,"width":734,"height":12}},{"id":"690b266b-0252-4565-a5a1-dd7c5cdc7f07","block_type":"box","text":"higher rated securities. The secondary markets for high yield securities are concentrated in","page_number":101,"box":{"x":150,"y":444,"width":680,"height":12}},{"id":"250d0a65-86df-47e2-a408-841b9ea30cc3","block_type":"box","text":"relatively few market makers and participants in the markets are mostly institutional investors,","page_number":101,"box":{"x":150,"y":459,"width":699,"height":12}},{"id":"f4576cf5-713d-458a-92c9-72ffa4a328b4","block_type":"box","text":"including insurance companies, banks, other financial institutions and mutual funds. In addition,","page_number":101,"box":{"x":150,"y":475,"width":712,"height":12}},{"id":"4c660ba9-3975-48ef-99dc-1d49f4650937","block_type":"box","text":"the trading volume for high yield securities is generally lower than that for higher rated securities","page_number":101,"box":{"x":150,"y":490,"width":718,"height":12}},{"id":"27fa17b0-bf33-49f1-b0fa-9e586c13e3fb","block_type":"box","text":"and the secondary markets could contract under adverse market or economic conditions","page_number":101,"box":{"x":150,"y":506,"width":662,"height":12}},{"id":"038e03e0-8f1d-4ecd-8dba-67706018530a","block_type":"box","text":"independent of any specific adverse changes in the condition of a particular issuer. Under certain","page_number":101,"box":{"x":150,"y":521,"width":725,"height":12}},{"id":"ab686d07-555b-46a8-a8d5-2de33c2c5fbe","block_type":"box","text":"economic and/or market conditions, a Fund may have difficulty disposing of certain high yield","page_number":101,"box":{"x":150,"y":537,"width":695,"height":12}},{"id":"08e80f95-55e8-443c-8f1e-920dc12ee5ac","block_type":"box","text":"securities due to the limited number of investors in that sector of the market. An illiquid secondary","page_number":101,"box":{"x":150,"y":552,"width":728,"height":12}},{"id":"4d6a0d09-ae27-4065-9374-d0f4854ee3dc","block_type":"box","text":"market may adversely affect the market price of the high yield security, which may result in","page_number":101,"box":{"x":150,"y":568,"width":678,"height":12}},{"id":"6fd5e49b-ac10-4c46-976b-c01eaf13b34d","block_type":"box","text":"increased difficulty selling the particular issue and obtaining accurate market quotations on the","page_number":101,"box":{"x":150,"y":583,"width":706,"height":12}},{"id":"16307568-db1a-412a-804e-55f2694f1d80","block_type":"box","text":"issue when valuing a Fund’s assets. Market quotations on high yield securities are available only","page_number":101,"box":{"x":150,"y":599,"width":722,"height":12}},{"id":"e996f295-d430-4e26-ab90-ed76beb30aa4","block_type":"box","text":"from a limited number of dealers, and such quotations may not be the actual prices available for a","page_number":101,"box":{"x":149,"y":614,"width":731,"height":12}},{"id":"c2787d00-c296-4904-bc54-9cd2ccb691cf","block_type":"box","text":"purchase or sale. When the secondary market for high yield securities becomes more illiquid, or in","page_number":101,"box":{"x":150,"y":630,"width":734,"height":12}},{"id":"ae9b3469-2fe0-4673-8df4-9e49ade79fda","block_type":"box","text":"the absence of readily available market quotations for such securities, the relative lack of reliable","page_number":101,"box":{"x":150,"y":645,"width":723,"height":12}},{"id":"5de715c7-e7ff-463b-bfe2-3d62854a1e1e","block_type":"box","text":"objective data makes it more difficult to value a Fund’s securities, and judgment plays a more","page_number":101,"box":{"x":150,"y":661,"width":691,"height":12}},{"id":"50dff497-62eb-40f5-ab94-c7e421053099","block_type":"box","text":"important role in determining such valuations.","page_number":101,"box":{"x":150,"y":676,"width":337,"height":12}},{"id":"d327efa8-d424-43f3-b6ce-105c65a92f60","block_type":"box","text":"• A Fund may incur expenses to the extent necessary to seek recovery upon default or to negotiate","page_number":101,"box":{"x":117,"y":699,"width":757,"height":13}},{"id":"69f47303-299b-4dc7-b7d0-8a2397e8abff","block_type":"box","text":"new terms with a defaulting issuer.","page_number":101,"box":{"x":150,"y":715,"width":256,"height":12}},{"id":"e6c102e4-ce73-4370-8316-b8a2e1c893d0","block_type":"box","text":"• The junk bond markets may react strongly to adverse news about an issuer or the economy, or to","page_number":101,"box":{"x":117,"y":738,"width":756,"height":12}},{"id":"91bd69ce-82ac-4367-8fa0-c752243b9516","block_type":"box","text":"the perception or expectation of adverse news, whether or not it is based on fundamental analysis.","page_number":101,"box":{"x":150,"y":754,"width":731,"height":12}},{"id":"bdbcc4be-8e67-4c05-a6a2-a85b838e3123","block_type":"box","text":"Additionally, prices for high yield securities may be affected by legislative and regulatory","page_number":101,"box":{"x":149,"y":769,"width":654,"height":12}},{"id":"0d3889e9-1262-4f15-a19a-d46354815646","block_type":"box","text":"developments. These developments could adversely affect a Fund’s NAV and investment","page_number":101,"box":{"x":150,"y":785,"width":664,"height":12}},{"id":"1333b2b6-ece1-45b6-aaba-02843f1679f3","block_type":"box","text":"practices, the secondary market for high yield securities, the financial condition of issuers of these","page_number":101,"box":{"x":150,"y":800,"width":726,"height":12}},{"id":"ed4d3adc-c9f2-4236-a94d-78002e76d150","block_type":"box","text":"securities and the value and liquidity of outstanding high yield securities, especially in a thinly","page_number":101,"box":{"x":150,"y":816,"width":690,"height":12}},{"id":"38edd2c0-71a6-4829-baf2-7d25d7df8e95","block_type":"box","text":"traded market. For example, federal legislation requiring the divestiture by federally insured","page_number":101,"box":{"x":150,"y":831,"width":681,"height":12}},{"id":"21cb7127-f797-4860-8863-3ba1bd976156","block_type":"box","text":"savings and loan associations of their investments in high yield bonds and limiting the deductibility","page_number":101,"box":{"x":150,"y":847,"width":733,"height":12}},{"id":"fcadbc75-19ef-4358-a2f2-7c9ea62a626f","block_type":"box","text":"of interest by certain corporate issuers of high yield bonds adversely affected the market in the","page_number":101,"box":{"x":150,"y":862,"width":706,"height":12}},{"id":"3576e3ed-b394-467a-8e61-bb9c2be0403f","block_type":"box","text":"past.","page_number":101,"box":{"x":150,"y":878,"width":41,"height":12}},{"id":"efbbd0ba-2512-427b-be51-45c68391784e","block_type":"box","text":"II-14","page_number":101,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"400795cf-bfd8-405b-a400-a395eb8074a8","block_type":"box","text":"NM1026U-6004382-101/605","page_number":101,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"12d21824-7938-4f9e-a083-9ae4de443c2f","block_type":"box","text":"• The rating assigned by a rating agency evaluates the issuing agency’s assessment of the safety of","page_number":102,"box":{"x":117,"y":87,"width":770,"height":12}},{"id":"32616dd4-adb5-49b9-8bfc-bce9acc6d3e6","block_type":"box","text":"a non-investment grade security’s principal and interest payments, but does not address market","page_number":102,"box":{"x":150,"y":103,"width":716,"height":12}},{"id":"82d4d06d-3fb6-4389-9c18-84348e2cd88b","block_type":"box","text":"value risk. Because such ratings of the ratings agencies may not always reflect current conditions","page_number":102,"box":{"x":150,"y":118,"width":728,"height":12}},{"id":"bd924788-a191-48e9-b983-2ee71d5612a2","block_type":"box","text":"and events, in addition to using recognized rating agencies and other sources, the Manager or","page_number":102,"box":{"x":150,"y":134,"width":705,"height":12}},{"id":"b6aa2b2f-2321-4556-8bf1-8e9a8c72a44b","block_type":"box","text":"sub-adviser performs its own analysis of the issuers whose non-investment grade securities a","page_number":102,"box":{"x":150,"y":149,"width":700,"height":12}},{"id":"2ab61708-3f3d-48f3-8bcf-bac85ae0ccc8","block_type":"box","text":"Fund holds. Because of this, the Fund’s performance may depend more on the Manager’s or","page_number":102,"box":{"x":151,"y":165,"width":693,"height":12}},{"id":"cefa5a2d-f9c8-4b36-8a43-feab253cee8e","block_type":"box","text":"sub-adviser’s own credit analysis than in the case of mutual funds investing in higher-rated","page_number":102,"box":{"x":150,"y":180,"width":678,"height":12}},{"id":"56c3048f-8bf2-4509-a638-31c0d718a885","block_type":"box","text":"securities.","page_number":102,"box":{"x":150,"y":196,"width":80,"height":9}},{"id":"52e2ba8e-d457-4ae6-80dd-dd3fd5cc86c7","block_type":"box","text":"In selecting non-investment grade securities, the Manager or sub-adviser considers factors such as","page_number":102,"box":{"x":117,"y":227,"width":742,"height":12}},{"id":"d61ed720-ed4f-41e7-ae00-046dbcee9e94","block_type":"box","text":"those relating to the creditworthiness of issuers, the ratings and performance of the securities, the","page_number":102,"box":{"x":116,"y":242,"width":731,"height":12}},{"id":"1610d4f1-9402-41b9-aa9a-77f30f4af965","block_type":"box","text":"protections afforded the securities and the diversity of the Fund. The Manager or sub-adviser","page_number":102,"box":{"x":117,"y":258,"width":694,"height":12}},{"id":"cad2c5d4-f6bb-404f-9ab6-6b453fdfc18c","block_type":"box","text":"continuously monitors the issuers of non-investment grade securities held by the Fund for their ability","page_number":102,"box":{"x":116,"y":273,"width":755,"height":12}},{"id":"4c6773a6-de02-4bf3-a87a-2631685f6bc0","block_type":"box","text":"to make required principal and interest payments, as well as in an effort to control the liquidity of the","page_number":102,"box":{"x":116,"y":289,"width":746,"height":12}},{"id":"31adc3ac-cf14-4dd1-a7bb-ae1bf1094d03","block_type":"box","text":"Fund so that it can meet redemption requests. If a security’s rating is reduced below the minimum","page_number":102,"box":{"x":117,"y":304,"width":729,"height":12}},{"id":"0fd08007-5a3c-40da-9e2a-7d6399c1951a","block_type":"box","text":"credit rating that is permitted for a Fund, the Fund’s adviser or sub-adviser will consider whether the","page_number":102,"box":{"x":116,"y":320,"width":745,"height":12}},{"id":"45b1e899-82ae-43b2-ac91-8144ffe5be92","block_type":"box","text":"Fund should continue to hold the security.","page_number":102,"box":{"x":117,"y":335,"width":315,"height":12}},{"id":"08a85034-afdb-480a-8a3b-6747c694e52f","block_type":"box","text":"In the event that a Fund investing in high yield securities experiences an unexpected level of net","page_number":102,"box":{"x":117,"y":366,"width":718,"height":12}},{"id":"7d4beaba-fd3c-48cd-a8fd-a6e45ddf5093","block_type":"box","text":"redemptions, the Fund could be forced to sell its holdings without regard to the investment merits,","page_number":102,"box":{"x":117,"y":382,"width":729,"height":12}},{"id":"96b48c6e-e1d0-4abd-ba73-a5a63f2b5d90","block_type":"box","text":"thereby decreasing the assets upon which the Fund’s rate of return is based.","page_number":102,"box":{"x":116,"y":397,"width":575,"height":12}},{"id":"eea8ec9f-90ed-426a-a68f-11af30299691","block_type":"box","text":"The costs attributable to investing in the junk bond markets are usually higher for several reasons,","page_number":102,"box":{"x":116,"y":428,"width":733,"height":12}},{"id":"cbf9cdb7-0dd3-43cc-aea3-987cec103031","block_type":"box","text":"such as higher investment research costs and higher commission costs.","page_number":102,"box":{"x":116,"y":444,"width":540,"height":12}},{"id":"5bf329d2-6c95-4803-9e15-6ee6657b2a0d","block_type":"box","text":"Mezzanine Investments.","page_number":102,"box":{"x":116,"y":475,"width":179,"height":9}},{"id":"cb4720a0-0063-4173-af72-2a5c8b1db671","block_type":"box","text":"Certain Funds, consistent with their restrictions on investing in securities of a","page_number":102,"box":{"x":297,"y":475,"width":579,"height":12}},{"id":"73309b7e-8f54-4974-86cb-50edf3f5c60e","block_type":"box","text":"specific credit quality, may invest in certain high yield securities known as mezzanine investments,","page_number":102,"box":{"x":116,"y":490,"width":735,"height":12}},{"id":"9bc8f8aa-9a9c-41ff-b27a-ff0c3e3ed7d1","block_type":"box","text":"which are subordinated debt securities which are generally issued in private placements in connection","page_number":102,"box":{"x":116,"y":506,"width":762,"height":12}},{"id":"5a34dba3-a4eb-4330-9d90-3454ef7380a2","block_type":"box","text":"with an equity security (","page_number":102,"box":{"x":116,"y":521,"width":175,"height":12}},{"id":"7fe4b227-6153-4e23-bd57-8dc686ff443e","block_type":"box","text":"e.g.","page_number":102,"box":{"x":292,"y":524,"width":26,"height":9}},{"id":"2a83bd07-4651-4900-b668-29e5e8f74ddb","block_type":"box","text":", with attached warrants). Such mezzanine investments may be issued with","page_number":102,"box":{"x":321,"y":521,"width":563,"height":12}},{"id":"f4f3e55c-700f-4e81-8fa1-c79f71aad93d","block_type":"box","text":"or without registration rights. Similar to other high yield securities, maturities of mezzanine investments","page_number":102,"box":{"x":116,"y":537,"width":767,"height":12}},{"id":"db12a721-5405-4a94-bb24-9e03cb37dc20","block_type":"box","text":"are typically seven to ten years, but the expected average life is significantly shorter at three to five","page_number":102,"box":{"x":116,"y":552,"width":738,"height":12}},{"id":"d9a02eee-b4d2-440c-a5a9-7d5f2e41fb27","block_type":"box","text":"years. Mezzanine investments are usually unsecured and subordinate to other obligations of the","page_number":102,"box":{"x":116,"y":568,"width":719,"height":12}},{"id":"ad043a57-a93d-4eb4-a870-ef4d63da04f8","block_type":"box","text":"issuer.","page_number":102,"box":{"x":117,"y":583,"width":53,"height":10}},{"id":"84b4c1c4-fb27-41ae-9000-055eea2bae96","block_type":"box","text":"Pay-in-kind Bonds.","page_number":102,"box":{"x":116,"y":614,"width":139,"height":12}},{"id":"b9442cd8-2272-46c8-b29e-daf29db28d32","block_type":"box","text":"Certain Funds may invest in pay-in-kind, or PIK, bonds. PIK bonds are bonds which","page_number":102,"box":{"x":257,"y":614,"width":631,"height":12}},{"id":"f094d1cb-2b08-4ab1-b1b9-98ec667e9bf1","block_type":"box","text":"pay interest through the issuance of additional debt or equity securities. Similar to zero coupon","page_number":102,"box":{"x":117,"y":630,"width":706,"height":12}},{"id":"33dc80ad-e8eb-4986-91b7-5645f4328a05","block_type":"box","text":"obligations, pay-in-kind bonds also carry additional risk as holders of these types of securities realize","page_number":102,"box":{"x":116,"y":645,"width":753,"height":12}},{"id":"b929d920-2bc4-4b61-9c79-60cc7dd2ba0e","block_type":"box","text":"no cash until the cash payment date unless a portion of such securities is sold and, if the issuer","page_number":102,"box":{"x":117,"y":661,"width":707,"height":12}},{"id":"45302b50-abef-4845-898c-28a72b9af6cb","block_type":"box","text":"defaults, a Fund may obtain no return at all on its investment. The market price of pay-in-kind bonds is","page_number":102,"box":{"x":116,"y":676,"width":759,"height":12}},{"id":"d23855df-eae3-427c-90a7-2a6bd108ea13","block_type":"box","text":"affected by interest rate changes to a greater extent, and therefore tends to be more volatile, than that","page_number":102,"box":{"x":116,"y":692,"width":758,"height":12}},{"id":"63503244-5481-4152-b131-acfbf9624520","block_type":"box","text":"of securities which pay interest in cash. Additionally, current U.S. federal tax law requires the holder of","page_number":102,"box":{"x":116,"y":707,"width":759,"height":12}},{"id":"8b77a457-17cd-4b06-a7b7-c774b0ab2b5d","block_type":"box","text":"pay-in-kind bonds to accrue income with respect to these securities prior to the receipt of cash","page_number":102,"box":{"x":117,"y":723,"width":698,"height":12}},{"id":"6aaf14f3-f7a0-47b6-b26f-98e82b2ea79d","block_type":"box","text":"payments. To maintain its qualification as a regulated investment company and avoid liability for U.S.","page_number":102,"box":{"x":117,"y":738,"width":747,"height":12}},{"id":"6e55513e-539f-4baf-a4d9-410b9fe223bf","block_type":"box","text":"federal income and excise taxes, each Fund may be required to distribute income accrued with respect","page_number":102,"box":{"x":116,"y":754,"width":765,"height":12}},{"id":"46348964-3af5-4f5b-b1aa-68626017e3ee","block_type":"box","text":"to these securities and may have to dispose of portfolio securities under disadvantageous","page_number":102,"box":{"x":116,"y":769,"width":665,"height":12}},{"id":"3bc0bbaf-d3bb-417d-9618-9b5dd18568bf","block_type":"box","text":"circumstances in order to generate cash to satisfy these distribution requirements.","page_number":102,"box":{"x":116,"y":785,"width":608,"height":12}},{"id":"d8c3b1cd-ff90-4216-bc8c-5313be24d173","block_type":"box","text":"Supranational Entities.","page_number":102,"box":{"x":117,"y":816,"width":165,"height":12}},{"id":"502fa8b8-c490-4a7e-84d5-d9bd835fdc25","block_type":"box","text":"A Fund may invest in debt securities of supranational entities. Examples of","page_number":102,"box":{"x":289,"y":816,"width":555,"height":12}},{"id":"759c009a-f0fb-4576-8bf7-ccfad0e95695","block_type":"box","text":"such entities include the International Bank for Reconstruction and Development (the World Bank), the","page_number":102,"box":{"x":116,"y":831,"width":766,"height":12}},{"id":"5f4efab4-0c33-4395-a460-679bc68ee6f9","block_type":"box","text":"European Steel and Coal Community, the Asian Development Bank and the Inter-American","page_number":102,"box":{"x":117,"y":847,"width":683,"height":12}},{"id":"100ade4f-9a05-4428-9070-6eb4c7bbd1f9","block_type":"box","text":"Development Bank. The government members, or “stockholders,” usually make initial capital","page_number":102,"box":{"x":117,"y":862,"width":691,"height":12}},{"id":"5d21dbbe-6e21-44a5-8cda-b21183fbba73","block_type":"box","text":"contributions to the supranational entity and in many cases are committed to make additional capital","page_number":102,"box":{"x":116,"y":878,"width":748,"height":12}},{"id":"a66870af-4aca-4246-8028-a2eda8ec5c02","block_type":"box","text":"II-15","page_number":102,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"f703e4d6-1d44-46ad-b1fc-01ad3da775af","block_type":"box","text":"NM1026U-6004382-102/605","page_number":102,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"55d024f0-4d89-4a73-994e-e4f834982013","block_type":"box","text":"contributions if the supranational entity is unable to repay its borrowings. There is no guarantee that","page_number":103,"box":{"x":116,"y":87,"width":744,"height":12}},{"id":"25c0ee25-0d6e-485b-bec1-14637cf17664","block_type":"box","text":"one or more stockholders of a supranational entity will continue to make any necessary additional","page_number":103,"box":{"x":116,"y":102,"width":729,"height":13}},{"id":"b72930e4-17f8-4c13-97a1-1d0ff22ad0da","block_type":"box","text":"capital contributions. If such contributions are not made, the entity may be unable to pay interest or","page_number":103,"box":{"x":116,"y":118,"width":739,"height":12}},{"id":"473deed6-3e94-442e-8e76-1e52b18fccdf","block_type":"box","text":"repay principal on its debt securities, and a Fund may lose money on such investments.","page_number":103,"box":{"x":117,"y":134,"width":655,"height":12}},{"id":"b3bd71f2-41ee-40f0-a3c3-3fed2414bd4d","block_type":"box","text":"Depositary Receipts (ADRs, EDRs and GDRs).","page_number":103,"box":{"x":116,"y":165,"width":367,"height":12}},{"id":"04c35b9c-6f19-4e18-b8d6-a58cb6e6d1a3","block_type":"box","text":"Certain Funds may invest in the securities of foreign","page_number":103,"box":{"x":484,"y":165,"width":397,"height":12}},{"id":"3d45edd6-85fe-4f76-ab50-969e9b439d96","block_type":"box","text":"issuers in the form of Depositary Receipts or other securities convertible into securities of foreign","page_number":103,"box":{"x":117,"y":180,"width":722,"height":12}},{"id":"2ef49d20-28c5-4fc1-b69f-9146af7652e3","block_type":"box","text":"issuers. Depositary Receipts may not necessarily be denominated in the same currency as the","page_number":103,"box":{"x":117,"y":196,"width":707,"height":12}},{"id":"f2b3091a-d7e4-41dd-b3b2-f50e15c01333","block_type":"box","text":"underlying securities into which they may be converted. The Fund may invest in both sponsored and","page_number":103,"box":{"x":117,"y":211,"width":749,"height":12}},{"id":"54940a76-00a7-44bd-a67c-11b955740a14","block_type":"box","text":"unsponsored American Depositary Receipts (“ADRs”), European Depositary Receipts (“EDRs”), Global","page_number":103,"box":{"x":117,"y":227,"width":769,"height":12}},{"id":"538fe174-aebd-4f48-8aa1-fa265e9a72b3","block_type":"box","text":"Depositary Receipts (“GDRs”) and other similar global instruments. ADRs typically are issued by an","page_number":103,"box":{"x":117,"y":242,"width":743,"height":12}},{"id":"8dab867b-da82-42f3-b137-8b84eb39e345","block_type":"box","text":"American bank or trust company and evidence ownership of underlying securities issued by a foreign","page_number":103,"box":{"x":116,"y":258,"width":756,"height":12}},{"id":"fd456756-b269-426a-bbe2-f97760485e8c","block_type":"box","text":"corporation. EDRs, which are sometimes referred to as Continental Depositary Receipts, are receipts","page_number":103,"box":{"x":116,"y":273,"width":757,"height":12}},{"id":"09b9c74f-db5b-4b29-a88a-04a583cde309","block_type":"box","text":"issued in Europe, typically by foreign banks and trust companies, that evidence ownership of either","page_number":103,"box":{"x":117,"y":289,"width":739,"height":12}},{"id":"eea3f819-7b7e-43aa-8400-10ad51f53825","block_type":"box","text":"foreign or domestic underlying securities. GDRs are depositary receipts structured like global debt","page_number":103,"box":{"x":116,"y":304,"width":732,"height":12}},{"id":"b2ff754f-8a30-44f5-83ba-5fd459638ae0","block_type":"box","text":"issues to facilitate trading on an international basis. In addition to investment risks associated with the","page_number":103,"box":{"x":117,"y":320,"width":758,"height":12}},{"id":"e3cad57b-ad8f-464a-90aa-196f4db15417","block_type":"box","text":"underlying issuer, Depositary Receipts expose a Fund to additional risks associated with the","page_number":103,"box":{"x":117,"y":335,"width":689,"height":12}},{"id":"809cc806-2e5d-4f4f-beb0-c0b2c8a5185d","block_type":"box","text":"non-uniform terms that apply to Depositary Receipt programs, credit exposure to the depository bank","page_number":103,"box":{"x":117,"y":351,"width":754,"height":12}},{"id":"b554a991-c79c-46c1-a5db-c701f0cf2e61","block_type":"box","text":"and to the sponsors and other parties with whom the depository bank establishes the programs,","page_number":103,"box":{"x":116,"y":366,"width":716,"height":12}},{"id":"91513446-8fd6-4572-9410-95b83c6f6505","block_type":"box","text":"currency risk and the risk of an illiquid market for Depositary Receipts. Unsponsored ADR, EDR and","page_number":103,"box":{"x":116,"y":382,"width":748,"height":12}},{"id":"2759346b-25fb-499d-8253-d2a9690c74d4","block_type":"box","text":"GDR programs are organized independently and without the cooperation of the issuer of the underlying","page_number":103,"box":{"x":117,"y":397,"width":771,"height":12}},{"id":"cffbdecc-3053-41f6-9b17-8f30fb550ff8","block_type":"box","text":"securities. Unsponsored programs generally expose investors to greater risks than sponsored","page_number":103,"box":{"x":116,"y":413,"width":701,"height":12}},{"id":"78534f3c-8e08-45c5-94d1-466f7afdac4b","block_type":"box","text":"programs and do not provide holders with many of the shareholder benefits that come from investing in","page_number":103,"box":{"x":117,"y":428,"width":769,"height":12}},{"id":"7540ae0d-ab27-4286-83d7-b1c2d34d0fb1","block_type":"box","text":"a sponsored Depositary Receipt. Available information concerning the issuer may not be as current as","page_number":103,"box":{"x":116,"y":444,"width":764,"height":12}},{"id":"6530e1b3-9c42-420e-bd95-33e557c6ebf2","block_type":"box","text":"for sponsored ADRs, EDRs and GDRs, and the prices of unsponsored ADRs, EDRs and GDRs may","page_number":103,"box":{"x":116,"y":459,"width":750,"height":12}},{"id":"5ff8ef12-48a9-46c5-a878-290391459d35","block_type":"box","text":"be more volatile than if such instruments were sponsored by the issuer. Depositary Receipts are","page_number":103,"box":{"x":117,"y":475,"width":718,"height":12}},{"id":"9277ab1e-2a46-4046-845e-572dcb1e9f14","block_type":"box","text":"generally subject to the same risks as the foreign securities that they evidence or into which they may","page_number":103,"box":{"x":116,"y":490,"width":759,"height":12}},{"id":"48cf93f2-0561-4b3f-ab56-470d71ba35e9","block_type":"box","text":"be converted. Investments in ADRs, EDRs and GDRs present additional investment considerations as","page_number":103,"box":{"x":117,"y":506,"width":763,"height":12}},{"id":"542d6f37-d11f-4eba-89c3-81e283d2706c","block_type":"box","text":"described under “Foreign Investment Risks.”","page_number":103,"box":{"x":116,"y":521,"width":336,"height":12}},{"id":"cccb1190-516a-46e8-bcf6-1f339587e789","block_type":"box","text":"Derivatives.","page_number":103,"box":{"x":116,"y":560,"width":99,"height":9}},{"id":"8e2943be-8d16-4ad0-83e3-2ef7ddf8d780","block_type":"box","text":"General.","page_number":103,"box":{"x":117,"y":583,"width":68,"height":10}},{"id":"9942868e-495f-4190-9466-3a1d4843d4f7","block_type":"box","text":"Each Fund may use instruments referred to as derivatives, which are financial instruments","page_number":103,"box":{"x":186,"y":583,"width":675,"height":12}},{"id":"dc37f0b9-9a2b-47e6-aa86-0dc956fa2aeb","block_type":"box","text":"that derive their value from one or more securities, commodities (such as gold or oil), currencies,","page_number":103,"box":{"x":116,"y":599,"width":722,"height":12}},{"id":"7604295a-3760-40d1-a4d8-bfb379a5f277","block_type":"box","text":"interest rates, credit events or indices (a measure of value or rates, such as the S&P 500 Index or the","page_number":103,"box":{"x":117,"y":614,"width":758,"height":12}},{"id":"d5ac1228-d1ac-4b41-9819-c637900939a3","block_type":"box","text":"prime lending rate) or other reference asset. Derivatives may allow a Fund to increase or decrease the","page_number":103,"box":{"x":117,"y":630,"width":765,"height":12}},{"id":"5b9e2ae2-e309-4abe-8ac0-9628f64266d6","block_type":"box","text":"level of risk to which the Fund is exposed more quickly and efficiently than with other transactions.","page_number":103,"box":{"x":117,"y":645,"width":732,"height":12}},{"id":"0794e03d-0811-40aa-957f-7c8c19b6f06c","block_type":"box","text":"Certain Funds may use derivatives to maintain a portion of their long and short positions. Unless","page_number":103,"box":{"x":117,"y":661,"width":714,"height":12}},{"id":"72319f05-4143-43c3-94f7-6d8a23898ae4","block_type":"box","text":"otherwise permitted, no Fund may use derivatives to gain exposure to an asset or asset class it is","page_number":103,"box":{"x":116,"y":676,"width":724,"height":12}},{"id":"9b3b5ecb-f246-464d-ba19-09e0e69b1169","block_type":"box","text":"prohibited by its investment restrictions from purchasing directly. As described below, derivatives can","page_number":103,"box":{"x":117,"y":692,"width":748,"height":12}},{"id":"4bcfd6f5-07f6-4d4d-a50e-3718a12a4058","block_type":"box","text":"be used for hedging or speculative purposes. Funds will engage in transaction-level payment netting,","page_number":103,"box":{"x":117,"y":707,"width":747,"height":12}},{"id":"76809eb6-d3e8-4578-bcbe-7401fe93a879","block_type":"box","text":"i.e.","page_number":103,"box":{"x":116,"y":723,"width":20,"height":9}},{"id":"737ba149-d172-42c5-b2aa-d58cfdee0533","block_type":"box","text":", the payment obligations of derivatives contracts are netted against one another with the Fund","page_number":103,"box":{"x":140,"y":723,"width":701,"height":12}},{"id":"59afec02-f4ad-4e1a-a28f-3a6dbe370580","block_type":"box","text":"receiving or paying, as the case may be, only the net amount of the two payment streams.","page_number":103,"box":{"x":117,"y":738,"width":667,"height":12}},{"id":"1b439904-d9a5-43bc-95b5-18d437755aea","block_type":"box","text":"Hedging.","page_number":103,"box":{"x":116,"y":769,"width":65,"height":12}},{"id":"3e5496dc-b6f6-40de-bce4-b4fc27bff3f6","block_type":"box","text":"Each Fund may use derivatives for hedging purposes, in which a derivative is used to offset","page_number":103,"box":{"x":189,"y":769,"width":680,"height":12}},{"id":"93074820-032b-4d10-90d1-1865637fc865","block_type":"box","text":"the risks associated with other Fund holdings. Losses on other investments may be substantially","page_number":103,"box":{"x":116,"y":785,"width":716,"height":12}},{"id":"18e3098d-e4bc-4a5b-b0ef-817d288a5d97","block_type":"box","text":"reduced by gains on a derivative that reacts in an opposite manner to market movements. Although","page_number":103,"box":{"x":117,"y":800,"width":737,"height":12}},{"id":"aa19a375-03a8-48c2-b7a3-2dedc66c7b3d","block_type":"box","text":"hedging may reduce losses, it may also reduce or eliminate gains. In addition, hedging may cause","page_number":103,"box":{"x":117,"y":816,"width":728,"height":12}},{"id":"a009122b-6c84-47ef-bb80-14ec70fb5bfc","block_type":"box","text":"losses if the market moves in an unanticipated manner, or if the cost of the derivative outweighs the","page_number":103,"box":{"x":117,"y":831,"width":744,"height":12}},{"id":"cd10d434-e888-4d2b-876d-c346a3215882","block_type":"box","text":"benefit of the hedge. The effectiveness of hedging may be reduced by correlation risk,","page_number":103,"box":{"x":117,"y":847,"width":643,"height":12}},{"id":"90e15549-65af-410b-beee-a969e5b3b5d2","block_type":"box","text":"i.e.","page_number":103,"box":{"x":761,"y":847,"width":20,"height":9}},{"id":"c5655d27-518c-4331-81e5-f65085f42faf","block_type":"box","text":",","page_number":103,"box":{"x":784,"y":855,"width":2,"height":3}},{"id":"497bda89-d2d0-4b22-b9a8-4f89a20b3bbc","block_type":"box","text":"the risk that","page_number":103,"box":{"x":793,"y":847,"width":91,"height":9}},{"id":"e6ea616e-503a-41ca-9530-73e7bc38805c","block_type":"box","text":"changes in the value of the derivative will not match those of the holdings being hedged as expected","page_number":103,"box":{"x":116,"y":862,"width":751,"height":12}},{"id":"8fb2da96-eeda-4c2f-af0c-ec4b1175a1a4","block_type":"box","text":"by a Fund, which may result in additional losses to the Fund. The inability to close or offset derivatives","page_number":103,"box":{"x":117,"y":878,"width":762,"height":12}},{"id":"5685fc16-fab1-40a1-8422-a7f6c1dba81a","block_type":"box","text":"II-16","page_number":103,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"9319049b-b86a-4401-9872-2cfaf4ccb066","block_type":"box","text":"NM1026U-6004382-103/605","page_number":103,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9b45f95b-263d-4146-927a-bd25d8af6e83","block_type":"box","text":"could also reduce the effectiveness of a Fund’s hedging. There is no assurance that a Fund’s hedging","page_number":104,"box":{"x":116,"y":87,"width":762,"height":12}},{"id":"9cb3cba5-51ac-4248-865b-66a1a0d2c3e7","block_type":"box","text":"will be effective. No Fund is required to use derivatives to hedge.","page_number":104,"box":{"x":116,"y":102,"width":486,"height":13}},{"id":"76e7b7ea-8e9f-4b31-8904-cc8a58301c42","block_type":"box","text":"Speculation.","page_number":104,"box":{"x":117,"y":131,"width":90,"height":12}},{"id":"6909c001-164d-4037-95d9-40334f9e45c4","block_type":"box","text":"Certain Funds may also use derivatives for speculative purposes to seek to enhance","page_number":104,"box":{"x":208,"y":131,"width":638,"height":12}},{"id":"7291a3cf-ef8a-4ac2-8eb2-8bf779518df0","block_type":"box","text":"returns. The use of a derivative is speculative if the Fund is primarily seeking to achieve gains, rather","page_number":104,"box":{"x":117,"y":146,"width":753,"height":12}},{"id":"06b39a60-5b48-4919-8efa-59230612c971","block_type":"box","text":"than offset the risk of other positions. To the extent a Fund invests in a derivative for speculative","page_number":104,"box":{"x":116,"y":162,"width":719,"height":12}},{"id":"f7edb777-4d56-496e-8af5-8033563fff03","block_type":"box","text":"purposes, the Fund will be fully exposed to the risks of loss of that derivative, which may sometimes be","page_number":104,"box":{"x":117,"y":177,"width":769,"height":12}},{"id":"a18492fa-928e-4a69-8d60-193d56c38fc0","block_type":"box","text":"greater than the derivative’s cost, and the potential for loss in certain cases may be unlimited.","page_number":104,"box":{"x":116,"y":193,"width":699,"height":12}},{"id":"067c76fb-9d2b-4a36-bc6e-74804b348bc5","block_type":"box","text":"Regulation of Derivatives.","page_number":104,"box":{"x":116,"y":227,"width":196,"height":12}},{"id":"155af725-8fc7-48a8-a8bd-ed9ba48a82d7","block_type":"box","text":"Rule 18f-4 Under the Investment Company Act.","page_number":104,"box":{"x":116,"y":249,"width":352,"height":12}},{"id":"8f870f47-bbba-41fd-a918-555ef19bad47","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits","page_number":104,"box":{"x":469,"y":249,"width":416,"height":12}},{"id":"4e69b126-7f3e-456b-8ee4-ffe743cfe7e1","block_type":"box","text":"a Fund to enter into Derivatives Transactions (as defined below) and certain other transactions","page_number":104,"box":{"x":116,"y":265,"width":708,"height":12}},{"id":"60bd17bb-c948-4ca7-ba52-c9c5900ba93d","block_type":"box","text":"notwithstanding the restrictions on the issuance of “senior securities” under Section 18 of the","page_number":104,"box":{"x":117,"y":280,"width":692,"height":12}},{"id":"81b4c0bd-cef9-49ad-9f00-2e89817ddc77","block_type":"box","text":"Investment Company Act. Section 18 of the Investment Company Act, among other things, prohibits","page_number":104,"box":{"x":117,"y":296,"width":747,"height":12}},{"id":"921d0f37-18f5-4729-80e2-f88279a66b63","block_type":"box","text":"open-end funds, including the Funds, from issuing or selling any “senior security,” other than borrowing","page_number":104,"box":{"x":116,"y":311,"width":769,"height":12}},{"id":"e21e4edd-b482-46a3-9667-9630695316db","block_type":"box","text":"from a bank (subject to a requirement to maintain 300% “asset coverage”).","page_number":104,"box":{"x":116,"y":327,"width":560,"height":12}},{"id":"34bc5644-4085-4823-9bef-255cfe69b223","block_type":"box","text":"Under Rule 18f-4, “Derivatives Transactions” include the following: (1) any swap, security-based swap","page_number":104,"box":{"x":117,"y":355,"width":761,"height":12}},{"id":"1971463c-2538-4743-bca6-e7e9489c79eb","block_type":"box","text":"(including a contract for differences), futures contract, forward contract, option (excluding purchased","page_number":104,"box":{"x":117,"y":370,"width":747,"height":13}},{"id":"37ce1bca-ab43-47bc-840e-048020ff7e67","block_type":"box","text":"options), any combination of the foregoing, or any similar instrument, under which a Fund is or may be","page_number":104,"box":{"x":116,"y":386,"width":764,"height":12}},{"id":"3b9381c4-f1b0-40c9-9eb6-d18c25f7e18b","block_type":"box","text":"required to make any payment or delivery of cash or other assets during the life of the instrument or at","page_number":104,"box":{"x":117,"y":401,"width":763,"height":13}},{"id":"430a3533-1c84-49e8-94a5-0dcc55c34872","block_type":"box","text":"maturity or early termination, whether as margin or settlement payment or otherwise; (2) any short sale","page_number":104,"box":{"x":117,"y":417,"width":767,"height":12}},{"id":"048134df-204e-4c15-94d2-783f54649a43","block_type":"box","text":"borrowing; (3) reverse repurchase agreements and similar financing transactions (e.g., recourse and","page_number":104,"box":{"x":117,"y":432,"width":750,"height":13}},{"id":"def12b14-559e-4dc1-883a-81868309b385","block_type":"box","text":"non-recourse tender option bonds, and borrowed bonds), if a Fund elects to treat all of these","page_number":104,"box":{"x":117,"y":448,"width":691,"height":12}},{"id":"692d40bb-6e30-4ae6-9ba8-c54875f66588","block_type":"box","text":"transactions as Derivatives Transactions under Rule 18f-4; and (4) when-issued or forward-settling","page_number":104,"box":{"x":116,"y":463,"width":738,"height":13}},{"id":"dff43780-2c18-4255-accd-73c5cd9c9453","block_type":"box","text":"securities (e.g., firm and standby commitments, including to-be-announced (“TBA”) commitments, and","page_number":104,"box":{"x":116,"y":479,"width":763,"height":12}},{"id":"adabdd92-621a-421e-87b8-8c0f2b49b441","block_type":"box","text":"dollar rolls) and non-standard settlement cycle securities, unless such transactions meet the Delayed","page_number":104,"box":{"x":116,"y":494,"width":755,"height":13}},{"id":"6a24ed15-2bb8-47f0-b36a-38a6d3f00e86","block_type":"box","text":"Settlement Securities Provision (as defined below under “—When-Issued Securities, Delayed Delivery","page_number":104,"box":{"x":116,"y":510,"width":763,"height":12}},{"id":"57db75cf-4f03-49e3-97a6-a738a51fc254","block_type":"box","text":"Securities and Forward Commitments”).","page_number":104,"box":{"x":116,"y":525,"width":302,"height":13}},{"id":"10f24e63-8a86-4320-897e-d9e592b1ea95","block_type":"box","text":"Unless a Fund is relying on the Limited Derivatives User Exception (as defined below), the Fund must","page_number":104,"box":{"x":117,"y":554,"width":759,"height":12}},{"id":"54afd2eb-8e2c-4211-b681-04191bf72a8c","block_type":"box","text":"comply with Rule 18f-4 with respect to its Derivatives Transactions. Rule 18f-4, among other things,","page_number":104,"box":{"x":116,"y":569,"width":744,"height":12}},{"id":"f7330e08-d236-4e1e-b521-91a5ed2098a4","block_type":"box","text":"requires a Fund to adopt and implement a comprehensive written derivatives risk management","page_number":104,"box":{"x":117,"y":585,"width":708,"height":12}},{"id":"54a3aa47-5bc6-4075-80bd-c89689982d11","block_type":"box","text":"program (“DRMP”) and comply with a relative or absolute limit on Fund leverage risk calculated based","page_number":104,"box":{"x":117,"y":600,"width":761,"height":12}},{"id":"8ceb59d7-b958-4d2f-a3b2-d5c34a819fe2","block_type":"box","text":"on value-at-risk (“VaR”). The DRMP is administered by a “derivatives risk manager,” who is appointed","page_number":104,"box":{"x":116,"y":616,"width":760,"height":12}},{"id":"10c2cf56-18ef-4d6b-8c1f-b9756f916df0","block_type":"box","text":"by the Fund’s Board, including a majority of the independent Directors, and periodically reviews the","page_number":104,"box":{"x":117,"y":631,"width":739,"height":12}},{"id":"a6139ad8-ec1f-4bba-a53a-9f4fbd4d9c1c","block_type":"box","text":"DRMP and reports to the Fund’s Board.","page_number":104,"box":{"x":117,"y":647,"width":299,"height":12}},{"id":"822ff022-38f6-42b1-b172-b7518a84193a","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":104,"box":{"x":117,"y":675,"width":758,"height":12}},{"id":"a5da5533-7114-41e9-b136-ee5258e26587","block_type":"box","text":"“derivatives exposure” is limited to 10% of its net assets (as calculated in accordance with Rule 18f-4)","page_number":104,"box":{"x":116,"y":690,"width":754,"height":13}},{"id":"fd8dda0d-a104-403c-9185-583b053747b6","block_type":"box","text":"and the Fund adopts and implements written policies and procedures reasonably designed to manage","page_number":104,"box":{"x":116,"y":706,"width":758,"height":12}},{"id":"386b8018-aef1-43ee-b950-b7f6d442ec4b","block_type":"box","text":"its derivatives risks (the “Limited Derivatives User Exception”).","page_number":104,"box":{"x":117,"y":721,"width":459,"height":13}},{"id":"6f1657b1-7278-4e6c-a940-a6485164fa5f","block_type":"box","text":"Dodd-Frank Regulations","page_number":104,"box":{"x":116,"y":756,"width":182,"height":12}},{"id":"8e8e78d1-6be1-4302-a708-8c2db4b28615","block_type":"box","text":". The Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd","page_number":104,"box":{"x":299,"y":756,"width":564,"height":12}},{"id":"b0fa8185-746f-4ba5-abf8-e495e8e75eda","block_type":"box","text":"Frank”), enacted in July 2010, includes provisions that comprehensively regulate the over-the-counter","page_number":104,"box":{"x":117,"y":772,"width":754,"height":12}},{"id":"073772a8-6b6b-43c1-81d6-1079f8cbcdf4","block_type":"box","text":"(“OTC”) derivatives markets for the first time. While the Commodity Futures Trading Commission","page_number":104,"box":{"x":117,"y":787,"width":716,"height":12}},{"id":"63c40a05-3cd4-4c07-833e-32c38d7a705f","block_type":"box","text":"(“CFTC”) and other U.S. regulators have adopted many of the required Dodd-Frank regulations, certain","page_number":104,"box":{"x":117,"y":803,"width":764,"height":12}},{"id":"d5f6e227-7ae8-49fc-ae93-619d343c4ed5","block_type":"box","text":"regulations have only recently become effective and other regulations remain to be adopted. The full","page_number":104,"box":{"x":117,"y":818,"width":743,"height":12}},{"id":"7ccee5db-39c5-4fec-9161-20d45f85a01f","block_type":"box","text":"impact of Dodd-Frank on the Funds remains uncertain.","page_number":104,"box":{"x":117,"y":834,"width":411,"height":12}},{"id":"8caa7e4d-8633-4332-aef4-bf96c8cbe4ea","block_type":"box","text":"Many OTC derivatives dealers are required to register with the CFTC as “swap dealers” and/or with the","page_number":104,"box":{"x":117,"y":862,"width":770,"height":12}},{"id":"aaeca7f0-8ee1-4f51-8dbf-f78c54ad3230","block_type":"box","text":"SEC as “security-based swap dealers”. Registered swap dealers and security-based swap dealers are","page_number":104,"box":{"x":116,"y":877,"width":765,"height":12}},{"id":"ff7f1e1d-74bb-405c-a446-3896f900b6d5","block_type":"box","text":"II-17","page_number":104,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"5f253aa1-4f1a-496d-a304-069fe25e876a","block_type":"box","text":"NM1026U-6004382-104/605","page_number":104,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4dec93b5-0dba-43fc-946b-272e722b3dbc","block_type":"box","text":"subject to various regulatory requirements, including, but not limited to, margin, recordkeeping,","page_number":105,"box":{"x":116,"y":87,"width":708,"height":12}},{"id":"2ea57066-0f92-4fe4-9498-b8f1ff780a0a","block_type":"box","text":"reporting, transparency, position limits, limitations on conflicts of interest, business conduct standards,","page_number":105,"box":{"x":117,"y":102,"width":761,"height":13}},{"id":"2a006136-4091-434e-94f1-aeb766907655","block_type":"box","text":"minimum capital requirements and other regulatory requirements, which indirectly impact the Funds","page_number":105,"box":{"x":117,"y":118,"width":743,"height":12}},{"id":"5fd7691c-ec65-4d2f-ab23-9287b31067ec","block_type":"box","text":"that enter into transactions with them.","page_number":105,"box":{"x":116,"y":134,"width":284,"height":9}},{"id":"4bd0bd97-d8fe-4011-a28d-0b06fb2e2856","block_type":"box","text":"The CFTC requires that certain interest rate swaps and certain credit default swaps must be executed","page_number":105,"box":{"x":116,"y":165,"width":761,"height":11}},{"id":"9628253e-4ac2-4294-a33b-0c5bb716892b","block_type":"box","text":"in regulated markets and be submitted for clearing to regulated clearinghouses. The SEC is also","page_number":105,"box":{"x":117,"y":180,"width":719,"height":12}},{"id":"17c16cf4-9953-45a2-9618-77ec86984167","block_type":"box","text":"expected to impose similar requirements on certain security-based derivatives in the future. OTC","page_number":105,"box":{"x":116,"y":196,"width":723,"height":12}},{"id":"a1ea945f-b9f9-4f65-b942-2f50d8c680c2","block_type":"box","text":"derivatives trades submitted for clearing are subject to minimum initial and variation margin","page_number":105,"box":{"x":116,"y":211,"width":681,"height":12}},{"id":"4722b4e0-f4a1-4fd6-b56b-a25fe6134e67","block_type":"box","text":"requirements set by the relevant clearinghouse, as well as margin requirements mandated by the","page_number":105,"box":{"x":117,"y":227,"width":726,"height":12}},{"id":"0f72123b-b72b-4b31-8232-1f925b79720f","block_type":"box","text":"CFTC, SEC and/or federal prudential regulators. In addition, futures commission merchants (“FCMs”),","page_number":105,"box":{"x":117,"y":242,"width":760,"height":12}},{"id":"c80a7428-8a58-4350-9055-09d9bc72a295","block_type":"box","text":"who act as clearing members on behalf of customers for cleared OTC derivatives and futures","page_number":105,"box":{"x":116,"y":258,"width":697,"height":12}},{"id":"0cc92ab8-f47c-4ca7-abad-2dee05ca21c9","block_type":"box","text":"contracts, also have discretion to increase a Fund’s margin requirements for these transactions beyond","page_number":105,"box":{"x":116,"y":273,"width":772,"height":12}},{"id":"41020da5-3975-4142-9bf1-4ab0b9366166","block_type":"box","text":"any regulatory and clearinghouse minimums subject to any restrictions on such discretion in the","page_number":105,"box":{"x":116,"y":289,"width":715,"height":12}},{"id":"83425324-44ff-4268-8ec1-492e2109d956","block_type":"box","text":"documentation between the FCM and the customer. These regulatory requirements may make it more","page_number":105,"box":{"x":116,"y":304,"width":764,"height":12}},{"id":"25dc4d2c-98c0-49f2-9f4b-3e43530c55b1","block_type":"box","text":"difficult and costly for the Funds to enter into highly tailored or customized transactions, potentially","page_number":105,"box":{"x":116,"y":320,"width":733,"height":12}},{"id":"52bb2eba-f48a-436a-a3bb-6e34a6f1d1b5","block_type":"box","text":"rendering certain investment strategies impossible or not economically feasible. If a Fund decides to","page_number":105,"box":{"x":117,"y":335,"width":747,"height":12}},{"id":"1b818513-6172-42bb-9e98-7aa2b6527f90","block_type":"box","text":"execute and clear cleared OTC derivatives and/or futures contracts through execution facilities,","page_number":105,"box":{"x":116,"y":351,"width":712,"height":12}},{"id":"d740d2e4-2428-4825-bffc-08fe5d601173","block_type":"box","text":"exchanges or clearinghouses, either indirectly through an executing broker, clearing member FCM or","page_number":105,"box":{"x":116,"y":366,"width":756,"height":12}},{"id":"cccfb25b-e03b-47c0-b964-6fee723a3874","block_type":"box","text":"as a direct member, a Fund would be required to comply with the rules of the execution facility,","page_number":105,"box":{"x":116,"y":382,"width":709,"height":12}},{"id":"34a46afc-5b59-4936-9ae2-79489008a954","block_type":"box","text":"exchange or clearinghouse and other applicable law.","page_number":105,"box":{"x":116,"y":397,"width":397,"height":12}},{"id":"9c13145a-5d09-4c2c-888a-02384357217c","block_type":"box","text":"With respect to cleared OTC derivatives and futures contracts and options on futures, a Fund will not","page_number":105,"box":{"x":116,"y":428,"width":753,"height":12}},{"id":"255c0db7-6447-4876-984a-3fea5fd00dff","block_type":"box","text":"face a clearinghouse directly but rather will do so through a FCM that is registered with the CFTC and/","page_number":105,"box":{"x":116,"y":444,"width":759,"height":12}},{"id":"6f3ad333-2b7e-4535-b76e-598cd9d4918d","block_type":"box","text":"or SEC and that acts as a clearing member. A Fund may face the indirect risk of the failure of another","page_number":105,"box":{"x":116,"y":459,"width":759,"height":12}},{"id":"cc18f2a6-71fd-4172-9f9c-7e17ea175c59","block_type":"box","text":"clearing member customer to meet its obligations to its clearing member. Such scenario could arise","page_number":105,"box":{"x":116,"y":475,"width":744,"height":12}},{"id":"00ff66e9-c13c-43f0-b495-0f3eab29a0d9","block_type":"box","text":"due to a default by the clearing member on its obligations to the clearinghouse simultaneously with a","page_number":105,"box":{"x":116,"y":490,"width":752,"height":12}},{"id":"cbed04d6-c783-4fc4-bc3d-fa436b8549b4","block_type":"box","text":"customer’s failure to meet its obligations to the clearing member.","page_number":105,"box":{"x":116,"y":506,"width":485,"height":12}},{"id":"2d6a77f7-e430-4622-b6f8-eb4a5c2b60d9","block_type":"box","text":"Clearing member FCMs are required to post initial margin to the clearinghouses through which they","page_number":105,"box":{"x":117,"y":537,"width":742,"height":12}},{"id":"f3933b1e-8667-4f3d-b0da-38e9f32cd213","block_type":"box","text":"clear their customers’ cleared OTC derivatives and futures contracts, instead of using such initial","page_number":105,"box":{"x":116,"y":552,"width":722,"height":12}},{"id":"5acab273-c2c6-424a-92fe-3592d8f86cbd","block_type":"box","text":"margin in their businesses, as was widely permitted for OTC derivatives before Dodd-Frank. While an","page_number":105,"box":{"x":117,"y":568,"width":757,"height":12}},{"id":"19dd6ae5-6cb9-4c36-8442-6787dd875c89","block_type":"box","text":"FCM may require its customer to post initial margin in excess of clearinghouse requirements, and","page_number":105,"box":{"x":117,"y":583,"width":727,"height":12}},{"id":"ac9a42b3-30ac-4e32-ae9c-52d4b75507f9","block_type":"box","text":"certain clearinghouses may share a portion of their earnings on initial margin with their clearing","page_number":105,"box":{"x":116,"y":599,"width":710,"height":12}},{"id":"6eaab93c-c229-4af0-b573-ddbe0048a7b6","block_type":"box","text":"members, some portion of the initial margin that is passed through to the clearinghouse does not","page_number":105,"box":{"x":117,"y":614,"width":722,"height":12}},{"id":"989bbfe3-7bdf-4ea6-828a-4e83a3c6f6fb","block_type":"box","text":"generate earnings for the FCM. The inability of FCMs to earn the same levels of returns on initial","page_number":105,"box":{"x":116,"y":630,"width":722,"height":12}},{"id":"daaa7ce2-9c12-4e49-8168-d84ab8db1fdf","block_type":"box","text":"margin for cleared OTC derivatives as they could earn with respect to non-cleared OTC derivatives","page_number":105,"box":{"x":117,"y":645,"width":739,"height":12}},{"id":"bbadd2ac-54f1-4f01-90f7-96fb3db4550b","block_type":"box","text":"may cause FCMs to charge higher fees, or provide less favorable pricing on cleared OTC derivatives","page_number":105,"box":{"x":117,"y":661,"width":747,"height":12}},{"id":"4f7d82cf-c5e5-402d-80e4-def3ff69394d","block_type":"box","text":"than swap dealers will provide for non-cleared OTC derivatives. Furthermore, customers, including the","page_number":105,"box":{"x":116,"y":676,"width":760,"height":12}},{"id":"bdcbb11c-c63b-4e52-aa62-30b2424c9076","block_type":"box","text":"Funds, are subject to additional fees payable to FCMs with respect to cleared OTC derivatives, which","page_number":105,"box":{"x":117,"y":692,"width":751,"height":12}},{"id":"102afeef-409e-499e-aa2c-664ebdc9e193","block_type":"box","text":"may raise the cost to Funds of clearing as compared to trading non-cleared OTC derivatives bilaterally.","page_number":105,"box":{"x":117,"y":707,"width":763,"height":12}},{"id":"7ac5432d-b6d2-4441-8490-7468115f9258","block_type":"box","text":"With respect to uncleared swaps, registered swap dealers and security-based swap dealers are","page_number":105,"box":{"x":116,"y":738,"width":710,"height":12}},{"id":"f0847002-3db4-4b45-8667-29bc0172dc8d","block_type":"box","text":"required to exchange variation margin with a Fund and may be required by applicable regulations to","page_number":105,"box":{"x":117,"y":754,"width":740,"height":12}},{"id":"ab80ad81-e7be-4db9-94b6-ffabdcd7675b","block_type":"box","text":"collect (and in some cases exchange) initial margin with a Fund. Both initial and variation margin may","page_number":105,"box":{"x":116,"y":769,"width":752,"height":12}},{"id":"731d479e-22be-417b-bc55-9e13e72cf9bb","block_type":"box","text":"be comprised of cash and/or securities, subject to applicable regulatory haircuts and other restrictions.","page_number":105,"box":{"x":117,"y":785,"width":757,"height":12}},{"id":"ce0fe540-c57e-4144-bc26-6820cc997c5b","block_type":"box","text":"Shares of investment companies (other than certain money market funds) may not be posted as","page_number":105,"box":{"x":116,"y":800,"width":713,"height":12}},{"id":"d14d9dd4-138a-42dd-99be-14ea9e77b62f","block_type":"box","text":"collateral under applicable regulations.","page_number":105,"box":{"x":116,"y":816,"width":285,"height":12}},{"id":"142e2338-72ca-4248-9aa5-08e3e36635c8","block_type":"box","text":"The CFTC, certain foreign regulators, and many futures exchanges have established (and continue to","page_number":105,"box":{"x":116,"y":847,"width":760,"height":12}},{"id":"e6398de4-bf26-46bf-ada9-67931be430cf","block_type":"box","text":"evaluate and monitor) speculative position limits (“position limits”) on the maximum speculative position","page_number":105,"box":{"x":116,"y":862,"width":771,"height":12}},{"id":"3c125d42-dc43-406d-a3dd-165b5b6ed1aa","block_type":"box","text":"which any person, or group of persons acting in concert, may hold or control in particular contracts. In","page_number":105,"box":{"x":116,"y":878,"width":759,"height":12}},{"id":"bfd5e97f-d651-4d50-bdeb-a650251f0349","block_type":"box","text":"II-18","page_number":105,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"f205ca82-ff5a-478d-94e4-ae28b1073110","block_type":"box","text":"NM1026U-6004382-105/605","page_number":105,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"37165d7f-06ff-4a2c-bb50-a292efae5023","block_type":"box","text":"addition, U.S. federal position limits apply to swaps that are economically equivalent to futures","page_number":106,"box":{"x":116,"y":87,"width":703,"height":12}},{"id":"c1ad8b31-2ad0-4031-8110-5cb82f06db00","block_type":"box","text":"contracts on certain agricultural, metals and energy commodities. All positions owned or controlled by","page_number":106,"box":{"x":116,"y":103,"width":758,"height":12}},{"id":"a03dc55b-22b9-4a99-8246-b8b265649034","block_type":"box","text":"the same person or entity, even if in different accounts, must be aggregated for purposes of complying","page_number":106,"box":{"x":116,"y":118,"width":766,"height":12}},{"id":"bfd59f05-954c-46d1-83a6-7e2169c26dd7","block_type":"box","text":"with the speculative limits. Thus, even if a Fund does not intend to exceed applicable position limits, it","page_number":106,"box":{"x":116,"y":134,"width":758,"height":11}},{"id":"8a3b98e2-59d1-4167-b504-6ac0c6777e9b","block_type":"box","text":"is possible that different clients managed by the Manager and its affiliates may be aggregated for this","page_number":106,"box":{"x":117,"y":149,"width":755,"height":12}},{"id":"c3ebc4e4-c619-44ff-b595-cc9d2e35c86c","block_type":"box","text":"purpose. Therefore, the trading decisions of the Manager may have to be modified and positions held","page_number":106,"box":{"x":117,"y":165,"width":757,"height":12}},{"id":"02136f40-b009-4c48-aba5-02769d174696","block_type":"box","text":"by a Fund liquidated in order to avoid exceeding such limits. The modification of investment decisions","page_number":106,"box":{"x":117,"y":180,"width":757,"height":12}},{"id":"c102e131-dd19-4abf-bdd5-8b72f9ae3b2d","block_type":"box","text":"or the elimination of open positions, if it occurs, may adversely affect the profitability of a Fund. A","page_number":106,"box":{"x":116,"y":196,"width":723,"height":12}},{"id":"f47fd138-da7c-4854-9685-b1d7d76099bb","block_type":"box","text":"violation of position limits could also lead to regulatory action materially adverse to a Fund’s investment","page_number":106,"box":{"x":116,"y":211,"width":770,"height":12}},{"id":"f7119026-4e1d-46db-b21d-7d5433c05757","block_type":"box","text":"strategy. A Fund may also be affected by other regimes, including those of the European Union and","page_number":106,"box":{"x":116,"y":227,"width":746,"height":12}},{"id":"e3596de6-7011-4f9a-bea5-0814b5fc5eee","block_type":"box","text":"United Kingdom, and trading venues that impose position limits on commodity derivative contracts.","page_number":106,"box":{"x":117,"y":242,"width":737,"height":12}},{"id":"6d1ece33-1f36-4b85-8a6b-ab32f3be1f77","block_type":"box","text":"Additional Regulation of Derivatives.","page_number":106,"box":{"x":115,"y":273,"width":269,"height":12}},{"id":"98d52b75-98ec-4fc7-8883-71cfa4df1206","block_type":"box","text":"Regulatory bodies outside the U.S. have also passed, proposed,","page_number":106,"box":{"x":386,"y":273,"width":489,"height":12}},{"id":"b5b91728-8cd1-413f-bcfd-3935d14a8540","block_type":"box","text":"or may propose in the future, legislation similar to Dodd-Frank or other legislation that could increase","page_number":106,"box":{"x":116,"y":289,"width":753,"height":12}},{"id":"3fbbef8b-1c99-4446-bcdb-9e4cb064d707","block_type":"box","text":"the costs of participating in, or otherwise adversely impact the liquidity of, participating in the","page_number":106,"box":{"x":116,"y":304,"width":689,"height":12}},{"id":"c811526f-5c00-47b8-98c9-62c7f58a556f","block_type":"box","text":"commodities markets. For example, the European Market Infrastructure Regulation (Regulation (EU)","page_number":106,"box":{"x":116,"y":320,"width":752,"height":12}},{"id":"b94f9c33-d917-402c-aa79-7614a82ed406","block_type":"box","text":"No 648/2012) (“EMIR”) introduced certain requirements in respect of OTC derivatives including:(i) the","page_number":106,"box":{"x":117,"y":335,"width":757,"height":12}},{"id":"fb704e9b-ffcd-4cba-82cc-921cf1b08adb","block_type":"box","text":"mandatory clearing of OTC derivative contracts declared subject to the clearing obligation; (ii) risk","page_number":106,"box":{"x":117,"y":351,"width":728,"height":12}},{"id":"f0161881-046e-4c17-ae96-ebcec4e4b5cf","block_type":"box","text":"mitigation techniques in respect of uncleared OTC derivative contracts, including the mandatory","page_number":106,"box":{"x":117,"y":366,"width":714,"height":12}},{"id":"cac75abc-4a4c-4682-bd66-9e33854fd08c","block_type":"box","text":"margining of uncleared OTC derivative contracts; and (iii) reporting and recordkeeping requirements in","page_number":106,"box":{"x":117,"y":382,"width":765,"height":12}},{"id":"95ac1499-38e4-4876-96ad-308eacb07b88","block_type":"box","text":"respect of all derivatives contracts. By way of further example, the European Union Markets in","page_number":106,"box":{"x":117,"y":397,"width":703,"height":12}},{"id":"a3fe65c6-0d74-477e-8b16-b8962a690a54","block_type":"box","text":"Financial Instruments Directive (Directive 2014/65/EU) and Markets in Financial Instruments","page_number":106,"box":{"x":117,"y":413,"width":688,"height":12}},{"id":"ad9e5adf-fcf5-4d8c-a8fd-e03149de4afc","block_type":"box","text":"Regulation (Regulation (EU) No 600/2014) (together “MiFID II”), which have applied since January 3,","page_number":106,"box":{"x":117,"y":428,"width":753,"height":12}},{"id":"c63a94a1-6982-4de2-a052-24c2bdcd0ce6","block_type":"box","text":"2018, govern the provision of investment services and activities in relation to, as well as the organized","page_number":106,"box":{"x":116,"y":444,"width":762,"height":12}},{"id":"53b40129-405f-4fec-9d10-5c5317646f5d","block_type":"box","text":"trading of, financial instruments such as shares, bonds, units in collective investment schemes and","page_number":106,"box":{"x":116,"y":459,"width":738,"height":12}},{"id":"3e4e1a02-2134-4e1b-a458-28eac96d6197","block_type":"box","text":"derivatives. In particular, MiFID II requires European Union Member States to apply position limits to","page_number":106,"box":{"x":116,"y":475,"width":749,"height":12}},{"id":"5e7658c4-3838-4054-9859-6c06e3d56f8e","block_type":"box","text":"the size of a net position a person can hold at any time in commodity derivatives traded on European","page_number":106,"box":{"x":116,"y":490,"width":754,"height":12}},{"id":"57f95b88-ab7d-47d8-b4a8-a94abce14a0c","block_type":"box","text":"Union trading venues and in “economically equivalent” OTC contracts. If the requirements of EMIR and","page_number":106,"box":{"x":117,"y":506,"width":769,"height":12}},{"id":"e25799ca-0bd2-4389-a520-34f7216d8441","block_type":"box","text":"MiFID II apply, the cost of derivatives transactions is expected to increase.","page_number":106,"box":{"x":117,"y":521,"width":557,"height":12}},{"id":"c575dbc5-c2f7-4639-a996-a408d0e4f223","block_type":"box","text":"In addition, regulations adopted by global prudential regulators that are now in effect require certain","page_number":106,"box":{"x":117,"y":552,"width":742,"height":12}},{"id":"15794b4b-be2a-4047-802a-468ffcf0702c","block_type":"box","text":"prudentially regulated entities and certain of their affiliates and subsidiaries (including swap dealers) to","page_number":106,"box":{"x":117,"y":568,"width":764,"height":12}},{"id":"d0bf312e-101f-4cda-ae99-cdf3d5b14c2c","block_type":"box","text":"include in their derivatives contracts and certain other financial contracts, terms that delay or restrict","page_number":106,"box":{"x":117,"y":583,"width":745,"height":12}},{"id":"9a174277-9ddd-48d2-bbfd-12281e1eea36","block_type":"box","text":"the rights of counterparties (such as the Funds) to terminate such contracts, foreclose upon collateral,","page_number":106,"box":{"x":116,"y":599,"width":761,"height":12}},{"id":"c653d3dd-8158-42d0-ae04-2fe8f1421ef8","block_type":"box","text":"exercise other default rights or restrict transfers of credit support in the event that the prudentially","page_number":106,"box":{"x":116,"y":614,"width":725,"height":12}},{"id":"397954b2-e74d-4e0c-9e9e-2e787c585bbd","block_type":"box","text":"regulated entity and/or its affiliates are subject to certain types of resolution or insolvency proceedings.","page_number":106,"box":{"x":117,"y":630,"width":765,"height":12}},{"id":"edeada11-e255-493c-84ca-9ac1d5c63598","block_type":"box","text":"Similar regulations and laws have been adopted in non-U.S. jurisdictions that may apply to a Fund’s","page_number":106,"box":{"x":116,"y":645,"width":746,"height":12}},{"id":"52cec58b-f40a-4449-aee8-c9d3e6d7ea34","block_type":"box","text":"counterparties located in those jurisdictions. In particular, in the United Kingdom and the European","page_number":106,"box":{"x":116,"y":661,"width":731,"height":12}},{"id":"a7bf2dd7-3cc9-4102-a519-64c74403d8f4","block_type":"box","text":"Union, governmental authorities could reduce, eliminate or convert to equity the liabilities to a Fund of","page_number":106,"box":{"x":117,"y":676,"width":753,"height":12}},{"id":"c9af86fe-a318-4254-a9dd-eef78a9aa01a","block_type":"box","text":"a counterparty experiencing financial difficulties (sometimes referred to as a “bail in”). It is possible that","page_number":106,"box":{"x":116,"y":692,"width":763,"height":12}},{"id":"7f292561-aadc-4745-8e24-c9c5d8188afc","block_type":"box","text":"these requirements, as well as potential additional related government regulation, could adversely","page_number":106,"box":{"x":116,"y":707,"width":726,"height":12}},{"id":"0c317889-230d-49b4-b2cf-f4c19e9dccf0","block_type":"box","text":"affect a Fund’s ability to terminate existing derivatives contracts, exercise default rights or satisfy","page_number":106,"box":{"x":116,"y":723,"width":716,"height":12}},{"id":"2dab6685-b4da-40b5-ab35-981984ef4f75","block_type":"box","text":"obligations owed to it with collateral received under such contracts.","page_number":106,"box":{"x":116,"y":738,"width":496,"height":12}},{"id":"072afcd2-a95c-49ab-9580-9cf7741e245e","block_type":"box","text":"Risk Factors in Derivatives.","page_number":106,"box":{"x":116,"y":777,"width":202,"height":9}},{"id":"648ff00e-ef64-4399-a8d2-7c67f7b46b69","block_type":"box","text":"There are significant risks that apply generally to derivatives transactions, including:","page_number":106,"box":{"x":116,"y":808,"width":620,"height":12}},{"id":"cd2a5146-e552-4095-9445-e56196d8d959","block_type":"box","text":"Correlation Risk —","page_number":106,"box":{"x":117,"y":831,"width":123,"height":10}},{"id":"795057f1-d5e5-4116-a97b-141b063286af","block_type":"box","text":"— the risk that changes in the value of a derivative will not match the changes in the","page_number":106,"box":{"x":240,"y":831,"width":631,"height":12}},{"id":"413e89e4-8a68-4acb-b3ac-6518a312168b","block_type":"box","text":"value of the portfolio holdings that are being hedged or of the particular market or security to which the","page_number":106,"box":{"x":116,"y":847,"width":765,"height":12}},{"id":"577bdb65-9ca7-454e-af75-26a84b99be84","block_type":"box","text":"Fund seeks exposure. There are a number of factors which may prevent a derivative instrument from","page_number":106,"box":{"x":117,"y":862,"width":754,"height":12}},{"id":"5cefaf3f-bdbf-4d3d-85a3-05354fd8f289","block_type":"box","text":"achieving the desired correlation (or inverse correlation) with an underlying asset, rate or index, such","page_number":106,"box":{"x":116,"y":878,"width":753,"height":12}},{"id":"1bfd3a78-f36e-4306-bc75-ca11faf2022d","block_type":"box","text":"II-19","page_number":106,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"a22cef54-77ec-489a-bf7e-f34bfabb85aa","block_type":"box","text":"NM1026U-6004382-106/605","page_number":106,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"d93a0886-dd3f-4e9f-843c-54aaf903a793","block_type":"box","text":"as the impact of fees, expenses and transaction costs, the timing of pricing, and disruptions or illiquidity","page_number":107,"box":{"x":116,"y":87,"width":772,"height":12}},{"id":"ccb9dfa6-8b65-496f-b262-8b0af59ec722","block_type":"box","text":"in the markets for such derivative instrument.","page_number":107,"box":{"x":117,"y":102,"width":338,"height":10}},{"id":"ed24766b-3395-425e-8b0a-48ddd092fc3b","block_type":"box","text":"Counterparty Risk —","page_number":107,"box":{"x":117,"y":134,"width":138,"height":12}},{"id":"294851b2-71b3-44fa-aa5a-42b609228bc7","block_type":"box","text":"—","page_number":107,"box":{"x":255,"y":139,"width":22,"height":4}},{"id":"e9b9828d-4bee-4c1e-847d-d080ffae666f","block_type":"box","text":"the risk that a derivatives transaction counterparty will be unable or unwilling to","page_number":107,"box":{"x":277,"y":134,"width":590,"height":12}},{"id":"ed7f3d91-aad0-4286-a480-5052fe056591","block_type":"box","text":"make payments or otherwise honor its obligations to a Fund and the related risks of having","page_number":107,"box":{"x":117,"y":149,"width":678,"height":12}},{"id":"0b3dfab1-389c-4a62-8d8e-9fc1de7368e0","block_type":"box","text":"concentrated exposure to such a counterparty. In particular, derivatives traded in OTC markets often","page_number":107,"box":{"x":116,"y":165,"width":751,"height":12}},{"id":"74e70e6c-ac0c-4dc0-9d51-16bbe9ca22bc","block_type":"box","text":"are not guaranteed by an exchange or clearing corporation and often do not require payment of","page_number":107,"box":{"x":116,"y":180,"width":714,"height":12}},{"id":"07347f91-a9bc-451a-a119-34669ad45ef4","block_type":"box","text":"margin, and to the extent that the Fund has unrealized gains in such instruments or has deposited","page_number":107,"box":{"x":117,"y":196,"width":732,"height":12}},{"id":"f0954f39-e8c4-4362-80f1-8bbcb55d8dad","block_type":"box","text":"collateral with its counterparties the Fund is at risk that its counterparties will become bankrupt or","page_number":107,"box":{"x":116,"y":211,"width":725,"height":12}},{"id":"4e94a1f6-f4ad-49dd-9d60-01bb7f861fb6","block_type":"box","text":"otherwise fail to honor their obligations. A Fund will typically attempt to minimize counterparty risk by","page_number":107,"box":{"x":116,"y":227,"width":750,"height":12}},{"id":"df2dc536-4781-4f1c-b58e-09d3dde3f160","block_type":"box","text":"engaging in OTC derivatives transactions only with creditworthy entities that have substantial capital or","page_number":107,"box":{"x":116,"y":242,"width":768,"height":12}},{"id":"b751b967-f3d7-4451-9dcd-e74602ae6ea6","block_type":"box","text":"that have provided the Fund with a third-party guaranty or other credit support. When a Fund enters","page_number":107,"box":{"x":116,"y":258,"width":745,"height":12}},{"id":"6a9b2a7a-0963-4b65-9fa4-772a27e92330","block_type":"box","text":"into a derivatives transaction that is centrally cleared (whether mandatorily or voluntarily), the Fund is","page_number":107,"box":{"x":117,"y":273,"width":754,"height":12}},{"id":"f0ac7593-7c6d-4a38-9564-975cf51d8ed9","block_type":"box","text":"subject to the credit risk of the clearing house and the clearing member through which it holds its","page_number":107,"box":{"x":116,"y":289,"width":722,"height":12}},{"id":"06b45ef8-713b-43ae-8d8b-e4526011b679","block_type":"box","text":"cleared position. Credit risk of market participants with respect to derivatives that are centrally cleared","page_number":107,"box":{"x":116,"y":304,"width":761,"height":12}},{"id":"a8d012de-1861-451c-b338-5734eba37b46","block_type":"box","text":"is concentrated in a few clearing houses and increasingly fewer clearing members. It is not clear how","page_number":107,"box":{"x":117,"y":320,"width":754,"height":12}},{"id":"7d9e327b-b323-42a1-b78b-6a0ae16529c3","block_type":"box","text":"an insolvency proceeding of a clearing house would be conducted and what impact an insolvency of a","page_number":107,"box":{"x":116,"y":335,"width":762,"height":12}},{"id":"495b3526-ab68-4c64-8393-03e0fde3d1a8","block_type":"box","text":"clearing house would have on the financial system. Also, a Fund will not be fully protected in the event","page_number":107,"box":{"x":116,"y":351,"width":764,"height":12}},{"id":"49b8f9ce-1fe2-420b-9fe4-b417a9b4d27e","block_type":"box","text":"of the bankruptcy of a Fund’s clearing member because the Fund would be limited to recovering only a","page_number":107,"box":{"x":116,"y":366,"width":768,"height":12}},{"id":"d00208ce-ce54-46f4-b77d-f1a6ab2d8f8c","block_type":"box","text":"pro rata share of the funds held by the clearing member on behalf of customers by account class for","page_number":107,"box":{"x":117,"y":382,"width":747,"height":12}},{"id":"b673b04d-659b-47b6-878a-49606145551e","block_type":"box","text":"cleared derivatives. Although a clearing member is required to segregate assets from customers with","page_number":107,"box":{"x":116,"y":397,"width":755,"height":12}},{"id":"e0b1edb2-a2f5-4e4a-a97a-e41ee9625ef7","block_type":"box","text":"respect to cleared derivatives positions from the clearing member’s proprietary assets, if a clearing","page_number":107,"box":{"x":117,"y":413,"width":736,"height":12}},{"id":"daeaaa22-4db0-43f5-90f5-c1b78dc478f9","block_type":"box","text":"member does not comply with the applicable regulations, or in the event of fraud or misappropriation of","page_number":107,"box":{"x":117,"y":428,"width":768,"height":12}},{"id":"101411f9-7960-4838-82dc-ccf24cd1b8df","block_type":"box","text":"customer assets by a clearing member, a Fund could have only an unsecured creditor claim in an","page_number":107,"box":{"x":116,"y":444,"width":730,"height":12}},{"id":"9799d04b-3d2e-4c3a-afb8-1000e363e607","block_type":"box","text":"insolvency of the clearing member with respect to the assets held by the clearing member.","page_number":107,"box":{"x":117,"y":459,"width":675,"height":12}},{"id":"09a0062d-eacb-4b1a-aa33-f60abadf16b5","block_type":"box","text":"Credit Risk —","page_number":107,"box":{"x":117,"y":490,"width":86,"height":10}},{"id":"31a70b15-f29a-4651-9c36-f74268e02f62","block_type":"box","text":"— the risk that the reference entity in a credit default swap or similar derivative will not be","page_number":107,"box":{"x":203,"y":490,"width":668,"height":12}},{"id":"46af2dc5-f17a-4f1b-8888-93afcabcd851","block_type":"box","text":"able to honor its financial obligations.","page_number":107,"box":{"x":116,"y":506,"width":280,"height":12}},{"id":"49836754-d7f7-43bd-a4ad-6239924afbb8","block_type":"box","text":"Currency Risk —","page_number":107,"box":{"x":117,"y":537,"width":109,"height":12}},{"id":"ecf6bad7-9f5b-4d21-8532-634c4038e38e","block_type":"box","text":"— the risk that changes in the exchange rate between two currencies will adversely","page_number":107,"box":{"x":226,"y":537,"width":625,"height":12}},{"id":"87c81d36-a094-4228-a229-4620b27f9a25","block_type":"box","text":"affect the value (in U.S. dollar terms) of a derivative.","page_number":107,"box":{"x":116,"y":552,"width":392,"height":12}},{"id":"12960f75-04da-41b6-ad3e-fb712c693102","block_type":"box","text":"Illiquidity Risk —","page_number":107,"box":{"x":117,"y":583,"width":105,"height":12}},{"id":"8379eedb-fe74-453e-aff9-d4a0570cb6c5","block_type":"box","text":"— the risk that certain securities or instruments may be difficult or impossible to sell at","page_number":107,"box":{"x":222,"y":583,"width":644,"height":12}},{"id":"68c9be3d-d6f8-4f1c-b38c-9358bab3dd0d","block_type":"box","text":"the time or at the price desired by a Fund in connection with payments of margin, collateral, or","page_number":107,"box":{"x":116,"y":599,"width":703,"height":12}},{"id":"1807b23f-d40d-4a17-9ce8-3ab4386562c6","block_type":"box","text":"settlement payments. There can be no assurance that a Fund will be able to unwind or offset a","page_number":107,"box":{"x":116,"y":614,"width":708,"height":12}},{"id":"f09518de-0f75-4d97-a522-f638fdeaa408","block_type":"box","text":"derivative at its desired price, in a secondary market or otherwise. It may, therefore, not be possible for","page_number":107,"box":{"x":116,"y":630,"width":768,"height":12}},{"id":"76ed7f42-926d-4563-86f8-c99e28c875cc","block_type":"box","text":"the Fund to unwind its position in a derivative without incurring substantial losses (if at all). Certain","page_number":107,"box":{"x":116,"y":645,"width":733,"height":12}},{"id":"9a5fc747-f30f-4022-991f-18c132d64a41","block_type":"box","text":"OTC derivatives, including swaps and OTC options, involve substantial illiquidity risk. Illiquidity may","page_number":107,"box":{"x":116,"y":661,"width":736,"height":12}},{"id":"12764b5d-79bf-42f8-ab34-217e1c5b525c","block_type":"box","text":"also make it more difficult for a Fund to ascertain a market value for such derivatives. A Fund will,","page_number":107,"box":{"x":116,"y":676,"width":723,"height":11}},{"id":"b81a1833-4bf0-497d-bc52-e1ed3fdf9276","block_type":"box","text":"therefore, acquire illiquid OTC derivatives (i) if the agreement pursuant to which the instrument is","page_number":107,"box":{"x":116,"y":692,"width":719,"height":12}},{"id":"44b435a5-131d-4184-8fd2-7406f23ca14e","block_type":"box","text":"purchased contains a formula price at which the instrument may be terminated or sold, or (ii) for which","page_number":107,"box":{"x":117,"y":707,"width":757,"height":12}},{"id":"cac9e712-3e0a-4ddc-94bd-4e9563cf4463","block_type":"box","text":"the Manager anticipates the Fund can receive on each business day at least two independent bids or","page_number":107,"box":{"x":116,"y":723,"width":751,"height":12}},{"id":"6f0e9a65-ed15-4209-ab41-5b72f6bb4444","block_type":"box","text":"offers, unless a quotation from only one dealer is available, in which case that dealer’s quotation may","page_number":107,"box":{"x":116,"y":738,"width":751,"height":12}},{"id":"483423f5-e4aa-4a7a-afb0-1e36edde0fc9","block_type":"box","text":"be used. The illiquidity of the derivatives markets may be due to various factors, including congestion,","page_number":107,"box":{"x":117,"y":754,"width":752,"height":12}},{"id":"7ab4684c-5521-4444-a331-314a64c1daa3","block_type":"box","text":"disorderly markets, limitations on deliverable supplies, the participation of speculators, government","page_number":107,"box":{"x":116,"y":769,"width":733,"height":12}},{"id":"1c866492-b41c-4e32-85ae-8cb6519d4b20","block_type":"box","text":"regulation and intervention, and technical and operational or system failures. In addition, the liquidity of","page_number":107,"box":{"x":117,"y":785,"width":763,"height":12}},{"id":"b54addce-91ad-4247-b2c6-b83303d9f2d5","block_type":"box","text":"a market in an exchange-traded derivative contract may be adversely affected by “daily price","page_number":107,"box":{"x":116,"y":800,"width":688,"height":12}},{"id":"b610c901-d16c-49fc-8d8c-20f343177b32","block_type":"box","text":"fluctuation limits” established by the exchanges which limit the amount of fluctuation in an exchange","page_number":107,"box":{"x":116,"y":816,"width":747,"height":12}},{"id":"345e34b6-863f-43d1-819a-0610ddda4dbd","block_type":"box","text":"traded contract price during a single trading day. Once the daily limit has been reached in the contract,","page_number":107,"box":{"x":116,"y":831,"width":766,"height":12}},{"id":"8832ec71-0ae8-4f5e-a600-950cc80f17b9","block_type":"box","text":"no trades may be entered into at a price beyond the limit, thus preventing the liquidation of open","page_number":107,"box":{"x":117,"y":847,"width":717,"height":12}},{"id":"d51f01af-7d1d-4812-b23f-0e5df0f35f73","block_type":"box","text":"positions. Prices have in the past moved to the daily limit on a number of consecutive trading days with","page_number":107,"box":{"x":117,"y":862,"width":768,"height":12}},{"id":"9cc4573b-03a6-43d3-a6d0-52a21b9db0c7","block_type":"box","text":"little to no trading. If it is not possible to close an open derivative position entered into by the Fund, the","page_number":107,"box":{"x":117,"y":878,"width":762,"height":12}},{"id":"bac18987-c5e2-4814-9f0a-bbdf36b1b881","block_type":"box","text":"II-20","page_number":107,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"184e12c1-67d1-429d-ad04-9826eb9fa4f3","block_type":"box","text":"NM1026U-6004382-107/605","page_number":107,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"89c840b0-1529-4621-acea-fd708bc6c58d","block_type":"box","text":"Fund would continue to be required to make daily cash payments of variation margin in the event of","page_number":108,"box":{"x":117,"y":87,"width":743,"height":12}},{"id":"bfec01cb-1fd0-4fd3-804a-1a50a4527a51","block_type":"box","text":"adverse price movements. In such a situation, if the Fund has insufficient cash, it may have to sell","page_number":108,"box":{"x":116,"y":102,"width":732,"height":13}},{"id":"5c485c52-4a28-432d-b2c1-20c26bb1dc85","block_type":"box","text":"portfolio securities to meet daily variation margin requirements at a time when it may be","page_number":108,"box":{"x":117,"y":118,"width":654,"height":12}},{"id":"28e27494-86c4-4372-9136-c05a96b3687c","block_type":"box","text":"disadvantageous to do so.","page_number":108,"box":{"x":116,"y":134,"width":201,"height":12}},{"id":"badbc446-4bc2-44dd-92d3-118c45b2f3e5","block_type":"box","text":"Index Risk —","page_number":108,"box":{"x":117,"y":163,"width":82,"height":10}},{"id":"8b6cd300-5a6b-4e03-b6a0-92b493f6aac3","block_type":"box","text":"— if the derivative is linked to the performance of an index, it will be subject to the risks","page_number":108,"box":{"x":199,"y":163,"width":651,"height":12}},{"id":"40e60cc3-cbd7-4c60-9b1e-42babec09203","block_type":"box","text":"associated with changes in that index. If the index changes, the Fund could receive lower interest","page_number":108,"box":{"x":116,"y":179,"width":728,"height":12}},{"id":"bb3d1b23-50e5-4ac5-8f73-6d9a26942c06","block_type":"box","text":"payments or experience a reduction in the value of the derivative to below the price that the Fund paid","page_number":108,"box":{"x":117,"y":194,"width":762,"height":12}},{"id":"a63f7730-8eb9-4454-8d64-5f213a964695","block_type":"box","text":"for such derivative.","page_number":108,"box":{"x":116,"y":210,"width":146,"height":9}},{"id":"956ce5e8-da10-401c-8f2e-e6b96e88cb3e","block_type":"box","text":"Legal Risk","page_number":108,"box":{"x":116,"y":240,"width":79,"height":12}},{"id":"0881eecf-7f73-41a5-aebe-0249c8e3482f","block_type":"box","text":"k — the risk of insufficient documentation, insufficient capacity or authority of counterparty, or","page_number":108,"box":{"x":194,"y":240,"width":689,"height":12}},{"id":"7fb92616-0017-46d4-93c1-c9b6692a620a","block_type":"box","text":"legality or enforceability of a contract.","page_number":108,"box":{"x":117,"y":255,"width":281,"height":12}},{"id":"f69c7000-39a0-4bf8-9aa1-97c7e1f680f1","block_type":"box","text":"Leverage Risk —","page_number":108,"box":{"x":116,"y":285,"width":112,"height":12}},{"id":"e905d82e-7ba7-43b6-b453-9ae069553678","block_type":"box","text":"— the risk that a Fund’s derivatives transactions can magnify the Fund’s gains and","page_number":108,"box":{"x":228,"y":285,"width":619,"height":12}},{"id":"70efa2c0-c591-46c7-b691-f84e0c406faf","block_type":"box","text":"losses. Relatively small market movements may result in large changes in the value of a derivatives","page_number":108,"box":{"x":117,"y":300,"width":744,"height":12}},{"id":"31d9cf1f-a990-44b2-817d-19fd8c995dae","block_type":"box","text":"position and can result in losses that greatly exceed the amount originally invested.","page_number":108,"box":{"x":117,"y":316,"width":621,"height":12}},{"id":"90208e0a-c9b1-4b1b-8431-ecb3250677fb","block_type":"box","text":"Market Risk —","page_number":108,"box":{"x":116,"y":346,"width":93,"height":9}},{"id":"4d8c878f-1472-418e-b19b-91ab8d3ef47b","block_type":"box","text":"— the risk that changes in the value of one or more markets or changes with respect to","page_number":108,"box":{"x":209,"y":346,"width":653,"height":12}},{"id":"2f131eba-889d-4d06-b7aa-c03211edf6cd","block_type":"box","text":"the value of the underlying asset will adversely affect the value of a derivative. In the event of an","page_number":108,"box":{"x":116,"y":361,"width":719,"height":12}},{"id":"f0fcd186-e50b-44b2-9053-5b5298fc62f0","block_type":"box","text":"adverse movement, a Fund may be required to pay substantial additional margin to maintain its","page_number":108,"box":{"x":116,"y":377,"width":713,"height":12}},{"id":"dc5b99d7-79be-444c-aa91-0be968d24379","block_type":"box","text":"position or the Fund’s returns may be adversely affected.","page_number":108,"box":{"x":117,"y":392,"width":427,"height":12}},{"id":"c7e92fad-753b-4dd3-b4f8-7e8cc925e24d","block_type":"box","text":"Operational Risk","page_number":108,"box":{"x":117,"y":422,"width":124,"height":12}},{"id":"4c618245-d0c7-4811-b562-b3eb29569e40","block_type":"box","text":"k — the risk related to potential operational issues, including documentation issues,","page_number":108,"box":{"x":240,"y":422,"width":616,"height":12}},{"id":"d7c54fb1-e189-47be-96d8-804555b48fe0","block_type":"box","text":"settlement issues, systems failures, inadequate controls and human error.","page_number":108,"box":{"x":116,"y":437,"width":555,"height":13}},{"id":"9404eb9a-0068-47e8-8a2e-a7855085b8b7","block_type":"box","text":"Valuation Risk —","page_number":108,"box":{"x":118,"y":467,"width":110,"height":10}},{"id":"a92eb652-a602-4b65-8368-d7a9db566746","block_type":"box","text":"— the risk that valuation sources for a derivative will not be readily available in the","page_number":108,"box":{"x":228,"y":467,"width":614,"height":12}},{"id":"83e364cb-2f97-46a5-bc03-14088fdd62c5","block_type":"box","text":"market. This is possible especially in times of market distress, since many market participants may be","page_number":108,"box":{"x":117,"y":483,"width":760,"height":12}},{"id":"bcfb5f08-b34c-45a7-aa97-5c9ffda0bed2","block_type":"box","text":"reluctant to purchase complex instruments or quote prices for them.","page_number":108,"box":{"x":117,"y":498,"width":507,"height":12}},{"id":"01c198ef-e7b7-40fd-92bd-bb94aa857211","block_type":"box","text":"Volatility Risk —","page_number":108,"box":{"x":118,"y":528,"width":102,"height":12}},{"id":"7531262b-238e-4d63-ad11-d44aa699c84a","block_type":"box","text":"— the risk that the value of derivatives will fluctuate significantly within a short time","page_number":108,"box":{"x":220,"y":528,"width":619,"height":12}},{"id":"b14eb70a-f3a5-4719-b6c9-a3b351d60794","block_type":"box","text":"period.","page_number":108,"box":{"x":117,"y":544,"width":55,"height":11}},{"id":"f8874c6b-f6b1-4592-aaf6-8d4f7c122ae8","block_type":"box","text":"Types of Derivatives Transactions.","page_number":108,"box":{"x":118,"y":580,"width":261,"height":13}},{"id":"5d2b85ed-2626-420e-a380-8b3e7ea6149b","block_type":"box","text":"A Fund may enter into derivatives transactions in accordance with its investment guidelines and","page_number":108,"box":{"x":116,"y":610,"width":715,"height":12}},{"id":"5e8eab45-5c83-45f6-849a-9a89ee664d10","block_type":"box","text":"restrictions, including the following:","page_number":108,"box":{"x":117,"y":626,"width":263,"height":12}},{"id":"ed173f71-69d4-4fe1-ad19-fb4094adcbb7","block_type":"box","text":"Futures.","page_number":108,"box":{"x":116,"y":663,"width":60,"height":9}},{"id":"19a885d4-4f24-4f6f-ac2c-d29e657ba996","block_type":"box","text":"A Fund may enter into futures contracts (“futures”) and options on futures contracts. Futures are","page_number":108,"box":{"x":116,"y":692,"width":713,"height":13}},{"id":"0b9747c7-79bb-48e8-b7e4-ee5692f56e81","block_type":"box","text":"standardized, exchange-traded contracts that require a purchaser to take delivery, and a seller to make","page_number":108,"box":{"x":116,"y":708,"width":767,"height":12}},{"id":"90e55092-d361-49fd-b819-b6186379ea36","block_type":"box","text":"delivery, of a specified amount of an asset at a specified future date and price. Upon purchasing or","page_number":108,"box":{"x":116,"y":723,"width":734,"height":13}},{"id":"2454b211-002c-48dc-80aa-1ad2f00167b0","block_type":"box","text":"selling a futures contract, a Fund is required to deposit initial margin equal to a percentage of the","page_number":108,"box":{"x":116,"y":739,"width":718,"height":12}},{"id":"25d6c95a-7665-4440-81b7-c202efe4ef0a","block_type":"box","text":"contract value. Futures contracts are marked to market daily for the duration of the contract, and the","page_number":108,"box":{"x":116,"y":754,"width":743,"height":13}},{"id":"105a649b-2303-4c01-b8eb-c84d5fd414a4","block_type":"box","text":"Fund will either post additional margin or be entitled to a payment, as applicable, based on the","page_number":108,"box":{"x":117,"y":770,"width":699,"height":12}},{"id":"38d05ffc-e4c3-4965-8abf-5f65abaa5bd8","block_type":"box","text":"mark-to-market movement of the contract.","page_number":108,"box":{"x":117,"y":786,"width":311,"height":9}},{"id":"a76e4d39-ffa4-4db6-b1c3-da7e5d7f8530","block_type":"box","text":"A Fund may sell a futures contract prior to the completion","page_number":108,"box":{"x":116,"y":815,"width":425,"height":12}},{"id":"e53189fc-2601-41e7-a4e5-3ce45d67366a","block_type":"box","text":"of its term to limit its risk of loss from a","page_number":108,"box":{"x":548,"y":815,"width":284,"height":10}},{"id":"853950c9-a7f4-43ac-807f-8475b760dc4d","block_type":"box","text":"decline in the market value of portfolio holdings correlated with the futures contract. However, in the","page_number":108,"box":{"x":116,"y":831,"width":745,"height":12}},{"id":"948e6b54-9d72-4624-b131-a2e2e5fe0cc4","block_type":"box","text":"event the market value of the portfolio holdings correlated with the futures contract increases rather","page_number":108,"box":{"x":116,"y":846,"width":742,"height":12}},{"id":"bff3c69e-9900-4422-b409-bcd48b362b5c","block_type":"box","text":"than decreases, a Fund will realize a loss on the futures position and a lower return on the portfolio","page_number":108,"box":{"x":116,"y":862,"width":739,"height":12}},{"id":"a66b46b2-2e37-4dec-9da2-17353498e0c8","block_type":"box","text":"holdings than would have been realized without the purchase of the futures contract.","page_number":108,"box":{"x":117,"y":877,"width":631,"height":12}},{"id":"25649457-60b3-4644-b47a-9ab7d60475a4","block_type":"box","text":"II-21","page_number":108,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"dff6413c-6c2e-4e1d-8525-e8f5859dc97e","block_type":"box","text":"NM1026U-6004382-108/605","page_number":108,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c85dafd6-f7ad-434b-85c6-fb169dc94830","block_type":"box","text":"The purchase of a futures contract may provide a Fund a lower cost alternative to purchasing","page_number":109,"box":{"x":116,"y":87,"width":697,"height":12}},{"id":"91761cb5-6fbd-4ebe-97fc-0d37b92d1176","block_type":"box","text":"securities or commodities directly. In the event that such securities or commodities decline in value or a","page_number":109,"box":{"x":116,"y":103,"width":772,"height":12}},{"id":"08f14aa5-20ae-4271-b8ae-7a41aed60bdc","block_type":"box","text":"Fund determines not to complete an anticipatory hedge transaction relating to a futures contract,","page_number":109,"box":{"x":117,"y":118,"width":720,"height":12}},{"id":"75cf0ba2-b7b6-48ac-83ef-c2480df1a3b3","block_type":"box","text":"however, the Fund may realize a loss relating to the futures position.","page_number":109,"box":{"x":117,"y":134,"width":512,"height":12}},{"id":"bcd10b4e-31ce-43b5-841f-b805c1ac93e3","block_type":"box","text":"Futures contracts are also subject to position limits. In order to comply with position limits, a Fund may","page_number":109,"box":{"x":117,"y":165,"width":763,"height":12}},{"id":"9169221e-6db8-4052-91db-d2016a2d71a5","block_type":"box","text":"be required to liquidate positions or may not be able to fully implement trading instructions. Any such","page_number":109,"box":{"x":117,"y":180,"width":750,"height":12}},{"id":"ccb37509-41e1-47de-8040-11d562270d30","block_type":"box","text":"liquidation or limited implementation could result in substantial costs to a Fund. See “—Regulation of","page_number":109,"box":{"x":117,"y":196,"width":750,"height":12}},{"id":"5060a4a6-5429-4985-b196-6ab42e8a1580","block_type":"box","text":"Derivatives—Dodd-Frank Regulations” above.","page_number":109,"box":{"x":117,"y":211,"width":346,"height":12}},{"id":"1783fa49-4085-48f0-a541-16bd6b3c0f0c","block_type":"box","text":"A Fund is also permitted to purchase or sell call and put options on futures contracts, including","page_number":109,"box":{"x":116,"y":242,"width":706,"height":12}},{"id":"2ee8de85-64cd-4be2-b44a-667ea230bcd3","block_type":"box","text":"financial futures and stock indices. Generally, these strategies would be used under the same market","page_number":109,"box":{"x":116,"y":258,"width":757,"height":12}},{"id":"bdf4f332-4f67-4f90-9990-717b4e18d7b1","block_type":"box","text":"and market sector conditions (","page_number":109,"box":{"x":116,"y":273,"width":225,"height":12}},{"id":"296d77bc-0534-404e-8359-bd09808bda63","block_type":"box","text":"i.e.","page_number":109,"box":{"x":342,"y":273,"width":20,"height":10}},{"id":"3081e559-8cc1-4667-b053-1265400d673c","block_type":"box","text":", conditions relating to specific types of investments) in which the","page_number":109,"box":{"x":365,"y":273,"width":485,"height":12}},{"id":"e2d368dc-b404-40d1-92e6-7a741a841a49","block_type":"box","text":"Fund entered into futures transactions. A Fund may purchase put options or write call options on","page_number":109,"box":{"x":117,"y":289,"width":720,"height":12}},{"id":"363076b6-2fe3-4bbe-9049-30db8e07283e","block_type":"box","text":"futures contracts and stock indices in lieu of selling the underlying futures contract in anticipation of a","page_number":109,"box":{"x":116,"y":304,"width":754,"height":12}},{"id":"c114f3b8-65b5-40fa-89c7-f54763360461","block_type":"box","text":"decrease in the market value of its securities. Similarly, a Fund can purchase call options, or write put","page_number":109,"box":{"x":116,"y":320,"width":759,"height":12}},{"id":"489e05c9-f2cb-4add-beee-50437e677a79","block_type":"box","text":"options on futures contracts and stock indices, as a substitute for the purchase of such futures","page_number":109,"box":{"x":116,"y":335,"width":705,"height":12}},{"id":"e507afe2-601d-4af7-9531-149b1220916d","block_type":"box","text":"contracts to hedge against the increased cost resulting from an increase in the market value of","page_number":109,"box":{"x":116,"y":351,"width":707,"height":12}},{"id":"f26a63e5-8e11-41b7-a6f9-508a1cb085a3","block_type":"box","text":"securities which the Fund intends to purchase.","page_number":109,"box":{"x":116,"y":366,"width":350,"height":12}},{"id":"6ee5a5c5-0d75-4d28-8f7e-176bf7c554af","block_type":"box","text":"To maintain greater flexibility, a Fund may invest in instruments which have characteristics similar to","page_number":109,"box":{"x":116,"y":397,"width":748,"height":12}},{"id":"d3b2af9a-3a9b-4e77-8480-5f9a4dc2f5ec","block_type":"box","text":"futures contracts. These instruments may take a variety of forms, such as debt securities with interest","page_number":109,"box":{"x":116,"y":413,"width":759,"height":12}},{"id":"ccd7296b-71b9-4c31-a3d3-2e1d6b884151","block_type":"box","text":"or principal payments determined by reference to the value of a security, an index of securities or a","page_number":109,"box":{"x":116,"y":428,"width":740,"height":12}},{"id":"59a04679-b050-44f8-ae47-5d4076af9ef4","block_type":"box","text":"commodity at a future point in time. The risks of such investments could reflect the risks of investing in","page_number":109,"box":{"x":116,"y":444,"width":764,"height":12}},{"id":"45e7b04f-c2e7-43c2-8f39-a383d2f2d07a","block_type":"box","text":"futures and securities, including volatility and illiquidity.","page_number":109,"box":{"x":116,"y":459,"width":410,"height":12}},{"id":"7f9074f7-25cb-479a-b0d9-0ffa75c082bf","block_type":"box","text":"Futures contracts and options on futures contracts are subject to significant correlation risk, leverage","page_number":109,"box":{"x":117,"y":490,"width":751,"height":12}},{"id":"4e9fd962-7fe3-41c9-8b89-abf5d146b0ff","block_type":"box","text":"risk, illiquidity risk, market risk and counterparty risk with respect to a Fund’s futures broker or the","page_number":109,"box":{"x":117,"y":506,"width":726,"height":12}},{"id":"0f4246a4-a38f-4f63-aaf8-ac4f3c69d2dc","block_type":"box","text":"clearinghouse. See “—Risk Factors in Derivatives” above.","page_number":109,"box":{"x":116,"y":521,"width":436,"height":12}},{"id":"736485a9-f1b7-4425-8d6e-2acfb1ca4ba6","block_type":"box","text":"Certain Funds may invest in futures based on carbon “allowances.” Under certain regulatory regimes, a","page_number":109,"box":{"x":117,"y":552,"width":771,"height":12}},{"id":"f73af504-1a84-4f3d-a1f3-dafdfe250d84","block_type":"box","text":"limit is set by a regulator, such as a government entity, on the total amount of specific greenhouse","page_number":109,"box":{"x":117,"y":568,"width":732,"height":12}},{"id":"a14b33ee-9e49-494d-99a7-745ecc053d5a","block_type":"box","text":"gases, such as CO2, that can be emitted by regulated entities, such as manufacturers or energy","page_number":109,"box":{"x":116,"y":583,"width":720,"height":12}},{"id":"78a90d77-1f41-40df-b780-b286ae9ca134","block_type":"box","text":"producers. The regulator then may issue or sell individual “emission allowances” to regulated entities,","page_number":109,"box":{"x":117,"y":599,"width":756,"height":12}},{"id":"3058001e-a652-47f4-a9c8-e5818e5c3fff","block_type":"box","text":"which can then be traded on the open market. Commodity futures contracts linked to the value of","page_number":109,"box":{"x":116,"y":614,"width":725,"height":12}},{"id":"cb65d219-1a53-4a58-b811-8b24b2697ed9","block_type":"box","text":"emission allowances are known as “carbon futures.”","page_number":109,"box":{"x":116,"y":630,"width":392,"height":9}},{"id":"95bc0bc6-38c8-4941-81f8-96241bea9dc0","block_type":"box","text":"The price for carbon futures contracts is based on a number of factors, including the supply of and the","page_number":109,"box":{"x":116,"y":661,"width":756,"height":12}},{"id":"7b6ef01c-5ab1-439a-bf39-0778975122f0","block_type":"box","text":"demand for carbon futures contracts. Changes in law, market conditions and expectations, position","page_number":109,"box":{"x":116,"y":676,"width":734,"height":12}},{"id":"15d26301-709e-4396-9fbf-2d5b68c9dc8c","block_type":"box","text":"limits, collateral requirements, and other factors each can impact the supply of and demand for carbon","page_number":109,"box":{"x":117,"y":692,"width":758,"height":12}},{"id":"18961f56-4923-4bdd-8d7c-d4decc430293","block_type":"box","text":"futures contracts. The market for carbon futures contracts is still developing and may be subject to","page_number":109,"box":{"x":116,"y":707,"width":729,"height":12}},{"id":"425e58a1-75ce-41b0-979a-1861324f36e0","block_type":"box","text":"periods of illiquidity. During such times it may be difficult or impossible to buy or sell a position at the","page_number":109,"box":{"x":117,"y":723,"width":742,"height":12}},{"id":"630503e3-bfab-428c-859c-e9adb27b95e3","block_type":"box","text":"desired price. Market disruptions or volatility can also make it difficult to find a counterparty willing to","page_number":109,"box":{"x":116,"y":738,"width":742,"height":12}},{"id":"58f29ce8-bc3b-4981-bbfa-582baed07bc2","block_type":"box","text":"transact at a reasonable price and sufficient size.","page_number":109,"box":{"x":116,"y":754,"width":363,"height":12}},{"id":"73d45878-59e6-4df8-be41-e7707e41008c","block_type":"box","text":"Swap Agreements.","page_number":109,"box":{"x":117,"y":792,"width":139,"height":12}},{"id":"551afbe9-be8b-4035-bb3e-d9be0d29b614","block_type":"box","text":"A Fund may enter into swap agreements for hedging purposes or speculative purposes. Swap","page_number":109,"box":{"x":116,"y":823,"width":699,"height":13}},{"id":"02ec6457-31d2-4c6b-88d5-62ac9d93b494","block_type":"box","text":"agreements are OTC contracts entered into primarily by financial institutions and institutional investors","page_number":109,"box":{"x":116,"y":839,"width":764,"height":12}},{"id":"be296607-194f-47f5-a669-787854fa7735","block_type":"box","text":"which may or may not be cleared by a central clearinghouse. In a standard “swap” transaction, two","page_number":109,"box":{"x":116,"y":854,"width":738,"height":13}},{"id":"7bcee602-e8af-4c80-abe5-e5501d217d03","block_type":"box","text":"parties agree to exchange the returns earned or realized from one or more underlying assets or rates","page_number":109,"box":{"x":117,"y":870,"width":755,"height":12}},{"id":"ac029581-59d0-458c-85cf-48e11d661f1d","block_type":"box","text":"II-22","page_number":109,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"75ae5fe7-90bc-4e53-8922-a60535acb2d3","block_type":"box","text":"NM1026U-6004382-109/605","page_number":109,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9844d2ad-1ea9-4a07-80f9-5d4dafdf43c0","block_type":"box","text":"of return, which may be adjusted for an interest factor. The gross returns to be exchanged or","page_number":110,"box":{"x":116,"y":87,"width":693,"height":12}},{"id":"5185e69e-b9e1-4c9d-bc69-d85671209823","block_type":"box","text":"“swapped” between the parties are generally calculated with respect to a “notional amount,”","page_number":110,"box":{"x":116,"y":102,"width":684,"height":13}},{"id":"db197f06-993a-44b7-8d77-38a085709406","block_type":"box","text":"e.g.","page_number":110,"box":{"x":801,"y":105,"width":26,"height":10}},{"id":"8e2351ae-57b8-40ad-b129-ec6c751d640a","block_type":"box","text":", the","page_number":110,"box":{"x":830,"y":103,"width":36,"height":11}},{"id":"2c8999b1-6ee5-4d0c-9307-d38d5e0a1c70","block_type":"box","text":"return or increase in value of a particular dollar amount invested at a particular interest rate, in a","page_number":110,"box":{"x":117,"y":118,"width":716,"height":12}},{"id":"1a892209-9a0d-4c55-9b09-4dc4eaa50495","block_type":"box","text":"particular foreign currency, or in a “basket” of securities representing a particular index. The notional","page_number":110,"box":{"x":117,"y":134,"width":747,"height":12}},{"id":"41c7936f-4a00-45e2-9ab0-00b8c15181ac","block_type":"box","text":"amount of the swap agreement is only used to calculate the obligations that the parties to a swap","page_number":110,"box":{"x":116,"y":149,"width":726,"height":12}},{"id":"2af03c56-9117-4344-8cc2-bab18c2df356","block_type":"box","text":"agreement have agreed to exchange. A Fund’s obligations (or rights) under a swap agreement will","page_number":110,"box":{"x":116,"y":165,"width":736,"height":12}},{"id":"ef6fb9ed-78d3-4895-bac2-de8f44073de2","block_type":"box","text":"generally be equal only to the net amount to be paid or received under the agreement based on the","page_number":110,"box":{"x":116,"y":180,"width":743,"height":12}},{"id":"3af791fb-ec39-468f-a007-a2dde4d0f70f","block_type":"box","text":"relative values of the positions held by each party to the agreement. Swaps that are not cleared involve","page_number":110,"box":{"x":117,"y":196,"width":770,"height":12}},{"id":"bf074266-ef71-49ac-b02a-64fac0aaeb48","block_type":"box","text":"substantial counterparty risk. A Fund will typically attempt to mitigate this counterparty risk by entering","page_number":110,"box":{"x":116,"y":211,"width":761,"height":12}},{"id":"e7cc3f01-bbee-4596-963f-f4514db011fe","block_type":"box","text":"into swap agreements only with creditworthy entities that have substantial capital or that have provided","page_number":110,"box":{"x":117,"y":227,"width":767,"height":12}},{"id":"65a95bd7-f8f9-4d44-8732-d39247c16932","block_type":"box","text":"the Fund with a third-party guaranty or other credit support. A Fund’s ability to use swap agreements","page_number":110,"box":{"x":116,"y":242,"width":751,"height":12}},{"id":"2b5b929d-1cc5-4737-b0f9-d36b8ec636b6","block_type":"box","text":"may be restricted by the tax rules applicable to registered investment companies.","page_number":110,"box":{"x":117,"y":258,"width":607,"height":12}},{"id":"1c5ceb48-1b10-4dbc-bbc9-16d486750d16","block_type":"box","text":"Credit Default Swaps and Similar Instruments.","page_number":110,"box":{"x":117,"y":289,"width":348,"height":12}},{"id":"dbd646c7-2b1a-46d8-9c37-60e226adf8e3","block_type":"box","text":"Certain Funds may enter into credit default swaps and","page_number":110,"box":{"x":466,"y":289,"width":407,"height":12}},{"id":"3fa7b580-7685-4c7e-b593-db618288c128","block_type":"box","text":"similar instruments. Credit default swaps are standardized agreements in which the protection “buyer”","page_number":110,"box":{"x":116,"y":304,"width":760,"height":12}},{"id":"6f803a7b-5fe6-4d22-bc04-559f89ba2186","block_type":"box","text":"pays the protection “seller” an up-front payment, or a periodic stream of payments, over the term of the","page_number":110,"box":{"x":117,"y":320,"width":768,"height":12}},{"id":"7a65f370-a6ac-4681-a95b-37263da10cf4","block_type":"box","text":"contract, provided generally that no credit event on a reference obligation has occurred. If a credit","page_number":110,"box":{"x":116,"y":335,"width":730,"height":12}},{"id":"19b613c4-3ea9-4fb5-b66e-9acdc6759d34","block_type":"box","text":"event occurs, the seller generally must pay the buyer the difference between the notional amount of","page_number":110,"box":{"x":116,"y":351,"width":745,"height":12}},{"id":"4f2bd28f-62d4-45d2-9f94-0c80d3e6c520","block_type":"box","text":"the contract and the value of a portfolio of securities issued by the reference entity. A Fund may be","page_number":110,"box":{"x":116,"y":366,"width":738,"height":12}},{"id":"8a7fc0fd-6395-46fe-85cc-174afe29d193","block_type":"box","text":"either the buyer or seller in the transaction. The Funds may enter into credit default swaps that","page_number":110,"box":{"x":116,"y":382,"width":706,"height":12}},{"id":"de48df2e-292e-4f68-961e-64be22809e2e","block_type":"box","text":"reference the obligations of a single entity (“single-name CDS”) or the obligations of entities that make","page_number":110,"box":{"x":117,"y":397,"width":761,"height":12}},{"id":"5eaab050-d5f5-4839-8550-fe060724ccb5","block_type":"box","text":"up an index (“index CDS”). References to “credit default swaps” shall collectively refer to single-name","page_number":110,"box":{"x":117,"y":413,"width":757,"height":12}},{"id":"d05f3ec5-1aa3-46eb-add8-8e6b4b3d5921","block_type":"box","text":"CDS and index CDS.","page_number":110,"box":{"x":117,"y":428,"width":161,"height":10}},{"id":"eddf0769-5b57-4499-b2f2-525642e7af13","block_type":"box","text":"Credit default swaps have as reference obligations one or more securities or loans that are not","page_number":110,"box":{"x":117,"y":459,"width":706,"height":12}},{"id":"5d5a3fe2-5466-437a-b716-bed4ec760510","block_type":"box","text":"currently held by a Fund. In circumstances in which a Fund does not own the securities or loans that","page_number":110,"box":{"x":116,"y":475,"width":749,"height":12}},{"id":"4696930c-c09c-440e-b439-ba5bd724a6d4","block_type":"box","text":"are deliverable under a credit default swap, the Fund is exposed to the risk that deliverable securities","page_number":110,"box":{"x":116,"y":490,"width":755,"height":12}},{"id":"cd239812-b85d-4a42-98f7-979d55cbef48","block_type":"box","text":"will not be available in the market, or will be available only at unfavorable prices, as would be the case","page_number":110,"box":{"x":116,"y":506,"width":763,"height":12}},{"id":"e77ff635-8866-40b1-92e8-a93fe7ff3c70","block_type":"box","text":"in a so-called “short squeeze.” In certain instances of issuer defaults or restructurings, it has been","page_number":110,"box":{"x":117,"y":521,"width":729,"height":12}},{"id":"fe0ce7bd-58f1-4dbe-8cf1-27d18bbeb6bb","block_type":"box","text":"unclear under the standard industry documentation for credit default swaps whether or not a “credit","page_number":110,"box":{"x":117,"y":537,"width":739,"height":12}},{"id":"8e2b24c8-3e6f-4351-b7e9-1d85fbbfa56c","block_type":"box","text":"event” triggering the seller’s payment obligation had occurred. Certain initiatives adopted by derivatives","page_number":110,"box":{"x":116,"y":552,"width":771,"height":12}},{"id":"89d3ab8a-6872-4a2d-a76d-8423d463da55","block_type":"box","text":"market participants, including the International Swaps and Derivatives Association (“ISDA”), are","page_number":110,"box":{"x":117,"y":568,"width":713,"height":12}},{"id":"1869f610-08e4-4cc0-8589-e693d9cec3d5","block_type":"box","text":"designed to implement uniform settlement terms into standard credit default swap documentation, as","page_number":110,"box":{"x":116,"y":583,"width":753,"height":12}},{"id":"04863806-80e4-4a0f-824d-4eeac3f69b80","block_type":"box","text":"well as refine the practices for the transparent conduct of the credit default swap market generally.","page_number":110,"box":{"x":116,"y":599,"width":735,"height":12}},{"id":"e462ab42-94ad-499c-a636-8d244cc7fbc6","block_type":"box","text":"Among these initiatives are the ISDA Credit Derivatives Determination Committee and the","page_number":110,"box":{"x":116,"y":614,"width":672,"height":12}},{"id":"8e5a92e8-4257-4c72-a3cb-fdf5bcefb1fa","block_type":"box","text":"implementation of market-wide cash settlement protocols applicable to all market-standard credit","page_number":110,"box":{"x":117,"y":630,"width":722,"height":12}},{"id":"19de10ed-e5d0-41fd-b2fd-cb23ff0efc1d","block_type":"box","text":"default swaps. These initiatives are intended to reduce both the uncertainty as to the occurrence of","page_number":110,"box":{"x":116,"y":645,"width":739,"height":12}},{"id":"6c43a54f-93c6-4b82-a5fd-21f34303b3d6","block_type":"box","text":"credit events and the risk of a “short squeeze” by providing that the ISDA Credit Derivatives","page_number":110,"box":{"x":116,"y":661,"width":679,"height":12}},{"id":"07f41676-fb35-4fbd-8200-6604725213ed","block_type":"box","text":"Determinations Committee will make determinations as to whether a credit event has occurred,","page_number":110,"box":{"x":117,"y":676,"width":704,"height":11}},{"id":"4d398f05-672b-4849-b3e3-f10ebba9f005","block_type":"box","text":"establish an auction to determine a settlement price and identify the deliverable securities for purposes","page_number":110,"box":{"x":116,"y":692,"width":763,"height":12}},{"id":"5af5f7c0-152e-40c7-a28a-cff4e385f8d7","block_type":"box","text":"of the auction, although the ISDA Credit Derivatives Determinations Committee may in certain limited","page_number":110,"box":{"x":116,"y":707,"width":750,"height":12}},{"id":"b6f87b8d-f812-4125-9360-1dbd94240175","block_type":"box","text":"circumstances refrain from doing so. In the event the ISDA Credit Derivatives Determinations","page_number":110,"box":{"x":116,"y":723,"width":691,"height":12}},{"id":"c4e35196-b8f4-45ec-935a-27d7950cf8f5","block_type":"box","text":"Committee cannot reach a timely resolution with respect to a “credit event” or otherwise does not","page_number":110,"box":{"x":117,"y":738,"width":718,"height":12}},{"id":"d1538c76-76fb-44f1-bbdf-140ef4361a91","block_type":"box","text":"establish a cash settlement auction, a Fund may not be able to realize the full value of the credit","page_number":110,"box":{"x":116,"y":754,"width":713,"height":12}},{"id":"1b7e5b43-82e2-4c9e-9b5b-a88772952427","block_type":"box","text":"default swap upon a default by the reference entity. Furthermore, a Fund may enter into certain credit","page_number":110,"box":{"x":116,"y":769,"width":753,"height":12}},{"id":"da55f761-0872-40c7-8b75-bfeafd2d0e43","block_type":"box","text":"default swaps or similar instruments that may not be covered by these initiatives.","page_number":110,"box":{"x":116,"y":785,"width":598,"height":12}},{"id":"99047287-04ea-42fa-82ee-5400b62511c1","block_type":"box","text":"If a Fund is a buyer, it will lose the payments made under the terms of the credit default swap and","page_number":110,"box":{"x":117,"y":816,"width":723,"height":12}},{"id":"918b02b6-4607-4e79-bcbd-ecac373bcb0c","block_type":"box","text":"recover nothing should no credit event occur. If a Fund is a seller and a credit event occurs, the value","page_number":110,"box":{"x":117,"y":831,"width":757,"height":12}},{"id":"30253c24-2bbe-4eb6-98dc-3a5d34413ead","block_type":"box","text":"of any deliverable obligation received by the Fund or the amount of cash settlement received by the","page_number":110,"box":{"x":116,"y":847,"width":744,"height":12}},{"id":"849a5bfc-160c-4564-a288-0c76f77346e2","block_type":"box","text":"Fund pursuant to the relevant cash settlement auction, together with the up-front or periodic payments","page_number":110,"box":{"x":117,"y":862,"width":763,"height":12}},{"id":"333c42d7-a156-4442-9082-f3c5f20925fb","block_type":"box","text":"previously received, may be less than the amount it pays to the buyer, resulting in a loss of value to the","page_number":110,"box":{"x":117,"y":878,"width":770,"height":12}},{"id":"e0e04342-f8bc-4be9-b599-dde6a905e961","block_type":"box","text":"II-23","page_number":110,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"56de3b7e-195d-4483-a92f-d7a95281fe6f","block_type":"box","text":"NM1026U-6004382-110/605","page_number":110,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5d21c334-7410-467c-b4cf-c4f56fecc411","block_type":"box","text":"Fund. A Fund that sells credit default swaps incurs leveraged exposure to the credit of one or more","page_number":111,"box":{"x":117,"y":87,"width":739,"height":12}},{"id":"b47d870c-b435-40fc-85db-692a10f5d016","block_type":"box","text":"reference entities and is subject to many of the same risks it would incur if it were holding debt","page_number":111,"box":{"x":117,"y":102,"width":703,"height":13}},{"id":"5406245d-e2d2-4b33-8802-bdfde2974e18","block_type":"box","text":"securities issued by the relevant reference entity. However, a Fund will not have any legal recourse","page_number":111,"box":{"x":116,"y":118,"width":742,"height":12}},{"id":"13c3b903-33b1-45a9-b659-0c92914f6fb7","block_type":"box","text":"against any reference entity and will not benefit from any collateral securing the reference entity’s debt","page_number":111,"box":{"x":116,"y":134,"width":764,"height":12}},{"id":"82f42193-511d-49cf-bc5d-28bfadb8c61a","block_type":"box","text":"obligations. In the event the ISDA Credit Derivatives Determinations Committee does not establish a","page_number":111,"box":{"x":116,"y":149,"width":750,"height":12}},{"id":"8c81c6e1-b914-4739-a2fa-5db9f8fe1c94","block_type":"box","text":"cash settlement auction and identify the relevant deliverable securities or loans, the credit default swap","page_number":111,"box":{"x":116,"y":165,"width":769,"height":12}},{"id":"5a9b16a9-a429-41bf-9dcd-2f2dbf66871c","block_type":"box","text":"buyer will have broad discretion to select which of the reference entity’s debt obligations to deliver to","page_number":111,"box":{"x":117,"y":180,"width":748,"height":12}},{"id":"7b26471b-fcf4-4ad9-b4a3-da5d4ae85e64","block_type":"box","text":"the Fund following a credit event and will likely choose the obligations with the lowest market value in","page_number":111,"box":{"x":116,"y":196,"width":755,"height":12}},{"id":"60a0c2f1-d17b-4060-b575-fc4b99352bb4","block_type":"box","text":"order to maximize the payment obligations of the Fund. In addition, credit default swaps generally trade","page_number":111,"box":{"x":116,"y":211,"width":772,"height":12}},{"id":"e91de91c-3940-4cae-a828-fad3ea6a5063","block_type":"box","text":"on the basis of theoretical pricing and valuation models, which may not accurately value such swap","page_number":111,"box":{"x":116,"y":227,"width":742,"height":12}},{"id":"73fe6bce-f217-4dea-9d69-ed4c575e15b6","block_type":"box","text":"positions when established or when subsequently traded or unwound under actual market conditions.","page_number":111,"box":{"x":117,"y":242,"width":756,"height":12}},{"id":"c976769b-1be6-4d2f-86d1-0d6492e992e8","block_type":"box","text":"Dodd-Frank requires that certain index CDS be executed in regulated markets and submitted for","page_number":111,"box":{"x":117,"y":274,"width":719,"height":13}},{"id":"328ddc99-61ac-41b7-8ec8-971f2c3957c7","block_type":"box","text":"clearing to regulated clearinghouses. See “—Derivatives—Regulation of Derivatives—Dodd-Frank","page_number":111,"box":{"x":116,"y":290,"width":734,"height":12}},{"id":"7eae0e1c-5028-49b4-ad74-947c413c25d1","block_type":"box","text":"Regulations” above. Other single-name CDS and index CDS are permitted, although not required, to","page_number":111,"box":{"x":117,"y":305,"width":750,"height":13}},{"id":"c2fd293f-bba4-4fba-a401-b82c0f15a9d6","block_type":"box","text":"be cleared through regulated clearinghouses. The Funds clear all credit default swaps that are subject","page_number":111,"box":{"x":117,"y":321,"width":762,"height":12}},{"id":"013da5f5-5c75-4e45-84a5-987304d0e2c7","block_type":"box","text":"to mandatory clearing and may voluntarily clear some, but not all, of the other credit default swaps not","page_number":111,"box":{"x":116,"y":336,"width":762,"height":13}},{"id":"78db2271-3fec-48b2-8d6e-55561bc3e201","block_type":"box","text":"subject to mandatory clearing. The Funds face counterparty risk with respect to the clearinghouse","page_number":111,"box":{"x":116,"y":352,"width":731,"height":12}},{"id":"78683efc-44ab-4407-b0f0-89ee5a5974ac","block_type":"box","text":"when entering into cleared single-name CDS and cleared index CDS. The Funds face significant","page_number":111,"box":{"x":116,"y":367,"width":722,"height":13}},{"id":"5d5a84c5-5588-41d9-93c8-b3d06aee6b4d","block_type":"box","text":"counterparty risk with respect to their counterparties to non-cleared credit default swaps and similar","page_number":111,"box":{"x":116,"y":383,"width":743,"height":12}},{"id":"51858482-c562-4ffe-bd21-802303fd2295","block_type":"box","text":"instruments. A Fund typically will enter into non-cleared credit default swaps and similar instruments","page_number":111,"box":{"x":117,"y":398,"width":746,"height":13}},{"id":"f5b52bc7-6eec-4d88-a2c5-3cbf1e1eaea6","block_type":"box","text":"with swap dealers and creditworthy entities that have substantial capital or that have provided the Fund","page_number":111,"box":{"x":116,"y":414,"width":771,"height":12}},{"id":"df8622ad-1d3a-4df7-9ced-8c9b49c7f7a5","block_type":"box","text":"with a third-party guaranty or other credit support.","page_number":111,"box":{"x":116,"y":430,"width":373,"height":12}},{"id":"9a70748d-1f20-4e12-896e-08d45fafd525","block_type":"box","text":"In certain instances, a Fund may enter into bespoke credit default swaps or similar instruments either","page_number":111,"box":{"x":117,"y":462,"width":755,"height":12}},{"id":"17cf7524-33da-4d0c-a6d3-b70b1aa40a8f","block_type":"box","text":"as protection buyer or protection seller. While these contracts are similar in their operation to the","page_number":111,"box":{"x":116,"y":477,"width":720,"height":12}},{"id":"63c9e039-50dc-414e-ac54-e5d17786bc97","block_type":"box","text":"market-standard credit default swaps described above, they are less standardized and instead have","page_number":111,"box":{"x":117,"y":493,"width":746,"height":12}},{"id":"9ed1bd82-443c-482e-bc19-158659035d4f","block_type":"box","text":"bespoke or tailored features. For example, as compared to market-standard credit defaults, the range","page_number":111,"box":{"x":117,"y":508,"width":758,"height":12}},{"id":"e0fd1d03-de4d-4504-af19-6d5d07ed82f3","block_type":"box","text":"of “credit events” triggering settlement of such bespoke contracts may be narrower or broader, any","page_number":111,"box":{"x":116,"y":524,"width":737,"height":12}},{"id":"a0bd405e-a9fc-45da-a833-d8063aad5248","block_type":"box","text":"such triggered contracts are settled by physical delivery of the underlying security or loan to or by the","page_number":111,"box":{"x":116,"y":539,"width":755,"height":12}},{"id":"5ed9ab1d-8c32-4ff4-8f14-e19bd670d7a1","block_type":"box","text":"Fund rather than by way of cash settlement, and there may be a wider range of securities as the","page_number":111,"box":{"x":117,"y":555,"width":719,"height":12}},{"id":"eece6051-62a7-470c-82f7-5faee67f54ef","block_type":"box","text":"reference obligations and/or deliverable obligations.","page_number":111,"box":{"x":117,"y":570,"width":388,"height":12}},{"id":"d9f4318d-6512-4c22-bd44-7678eaba3116","block_type":"box","text":"In addition, credit default swaps and similar instruments generally involve greater risks than if a Fund","page_number":111,"box":{"x":117,"y":603,"width":752,"height":12}},{"id":"95a3027c-6544-4964-bd8e-71165cbcdb9a","block_type":"box","text":"had invested in the reference obligation directly and are subject to significant credit risk, correlation","page_number":111,"box":{"x":117,"y":618,"width":738,"height":12}},{"id":"ecb0cbb1-1d18-4b41-9d5b-1083e9c5dac9","block_type":"box","text":"risk, leverage risk, illiquidity risk and market risk. See “—Risk Factors in Derivatives” above.","page_number":111,"box":{"x":117,"y":634,"width":684,"height":12}},{"id":"b5e407b6-19de-4fb1-b89f-70b742c4cb0f","block_type":"box","text":"Interest Rate Swaps, Floors and Caps.","page_number":111,"box":{"x":117,"y":658,"width":292,"height":12}},{"id":"56f18c51-aa73-4546-b7b2-b13cc9eb2414","block_type":"box","text":"Certain Funds may enter into OTC derivatives in the form of","page_number":111,"box":{"x":410,"y":658,"width":450,"height":12}},{"id":"16aead94-06a5-4819-8cda-656d74aed536","block_type":"box","text":"interest rate swaps and interest rate caps and floors. As described in further detail below, a Fund may","page_number":111,"box":{"x":117,"y":673,"width":755,"height":12}},{"id":"9f0a5ccb-c14e-473c-910e-12739c4921fe","block_type":"box","text":"enter into these transactions primarily to preserve a return or spread on a particular investment or","page_number":111,"box":{"x":116,"y":689,"width":724,"height":12}},{"id":"161e1b6c-8926-432e-bb64-bd40d77a9b61","block_type":"box","text":"portion of its holdings, as a duration management technique, to protect against an increase in the price","page_number":111,"box":{"x":117,"y":704,"width":762,"height":12}},{"id":"cb7f65c7-1c2f-45d0-b1f2-8ed9ead2a795","block_type":"box","text":"of securities a Fund anticipates purchasing at a later date, or for speculation to increase returns.","page_number":111,"box":{"x":116,"y":720,"width":712,"height":12}},{"id":"de8b44b2-9786-46e6-a9be-9b8d09edaaee","block_type":"box","text":"Dodd-Frank requires that certain interest rate swaps be executed in regulated markets and submitted","page_number":111,"box":{"x":117,"y":752,"width":750,"height":12}},{"id":"d4437090-92f3-4b4b-9705-24ed2ea26aa7","block_type":"box","text":"for clearing to regulated clearinghouses. See “—Regulation of Derivatives—Dodd-Frank Regulations”","page_number":111,"box":{"x":116,"y":767,"width":752,"height":13}},{"id":"3e50a6d6-ed77-434c-9970-5fed801a2066","block_type":"box","text":"above. Other interest rate swaps are permitted, although not required, to be cleared. Most of the","page_number":111,"box":{"x":116,"y":783,"width":715,"height":12}},{"id":"463ceeb5-0b8d-46ee-a6ab-4c0c3fa42b34","block_type":"box","text":"interest rate swaps entered into by the Funds are cleared. The Funds face counterparty risk with","page_number":111,"box":{"x":117,"y":798,"width":714,"height":13}},{"id":"77c75e7b-55fa-4787-8a0d-2b8ae15d75db","block_type":"box","text":"respect to the clearinghouse when entering into cleared interest rate swaps.","page_number":111,"box":{"x":117,"y":814,"width":561,"height":12}},{"id":"68d803c2-c716-4f68-8366-4d47fd9beb7c","block_type":"box","text":"The Funds face significant counterparty risk with respect to their counterparties to non-cleared interest","page_number":111,"box":{"x":116,"y":846,"width":764,"height":12}},{"id":"faf604b9-abb4-4c75-a1ae-211a1c69e297","block_type":"box","text":"rate swaps and interest rate caps and floors. The typical counterparties for a Fund’s non-cleared","page_number":111,"box":{"x":117,"y":862,"width":719,"height":12}},{"id":"2ee5753b-1782-46f9-b6a0-2ed0fc3cab26","block_type":"box","text":"interest rate derivatives transactions are swap dealers and other creditworthy entities that have","page_number":111,"box":{"x":117,"y":878,"width":709,"height":11}},{"id":"29355408-d71e-4235-83a0-a7c618c19db1","block_type":"box","text":"II-24","page_number":111,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"48ce0b7a-13d9-46d8-9b04-61ce780f507b","block_type":"box","text":"NM1026U-6004382-111/605","page_number":111,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"e2f9e5fd-a302-46b2-8c5b-4e83d4bfff39","block_type":"box","text":"substantial capital or that have provided the Fund with a third-party guaranty or other credit support.","page_number":112,"box":{"x":116,"y":87,"width":746,"height":12}},{"id":"105698c3-92ed-407e-a2c8-08dcc7d0eeb0","block_type":"box","text":"If the Fund’s counterparty defaults on such a transaction, a Fund will have contractual remedies with","page_number":112,"box":{"x":117,"y":102,"width":749,"height":13}},{"id":"648ca850-54be-4626-8505-b9434add9578","block_type":"box","text":"respect to the transaction, but there can be no guarantee that the Fund will be successful in enforcing","page_number":112,"box":{"x":117,"y":118,"width":758,"height":12}},{"id":"7338f185-7eb9-48a1-9af6-424f1c724dc1","block_type":"box","text":"such remedies. The market for interest rate swaps is relatively liquid in comparison with other similar","page_number":112,"box":{"x":116,"y":134,"width":751,"height":12}},{"id":"eec90d30-3332-4ccd-994b-7ae09372667c","block_type":"box","text":"instruments traded in the interbank market. A Fund may be limited in its ability to enter into certain","page_number":112,"box":{"x":117,"y":149,"width":732,"height":12}},{"id":"4ec281de-4ab0-4232-81f2-3b6a66650f32","block_type":"box","text":"interest rate derivatives due to applicable income tax requirements.","page_number":112,"box":{"x":117,"y":165,"width":503,"height":11}},{"id":"b082cd94-3b0d-4247-a888-f38ba4d9b443","block_type":"box","text":"Interest rate swaps are transactions in which each party makes periodic interest payments based on a","page_number":112,"box":{"x":117,"y":196,"width":762,"height":12}},{"id":"bd6b2530-904e-4255-9bc3-15a4acd21769","block_type":"box","text":"fixed or variable interest rate, index or asset in return for periodic payments from its counterparty based","page_number":112,"box":{"x":116,"y":211,"width":772,"height":12}},{"id":"8b73d388-d7c6-4f00-9e06-72e94c474902","block_type":"box","text":"on a different fixed or variable interest rate, index or asset.","page_number":112,"box":{"x":116,"y":227,"width":439,"height":11}},{"id":"b3dabbb1-e72a-4ec9-9947-c5e4475dc471","block_type":"box","text":"The purchase of an interest rate floor entitles the purchaser, to the extent that a specified index falls","page_number":112,"box":{"x":116,"y":258,"width":746,"height":11}},{"id":"70000978-dde0-4708-808d-7054c20f330a","block_type":"box","text":"below a predetermined interest rate, to receive payments of interest on a notional principal amount","page_number":112,"box":{"x":117,"y":273,"width":736,"height":12}},{"id":"19e0fe1e-efab-41f0-84b5-e5b52926edad","block_type":"box","text":"from the party selling such interest rate floor.","page_number":112,"box":{"x":116,"y":289,"width":337,"height":12}},{"id":"23b87b33-53b4-465d-af51-7d67baf7e179","block_type":"box","text":"The purchase of an interest rate cap entitles the purchaser, to the extent that a specified index rises","page_number":112,"box":{"x":116,"y":320,"width":746,"height":12}},{"id":"90e72fee-6ae2-4344-8824-9d2a7a17b53b","block_type":"box","text":"above a predetermined interest rate, to receive payments of interest on a notional principal amount","page_number":112,"box":{"x":116,"y":335,"width":739,"height":12}},{"id":"0d914dc8-5ebe-4367-a714-28191b37b0e0","block_type":"box","text":"from the party selling such interest rate cap.","page_number":112,"box":{"x":116,"y":351,"width":331,"height":12}},{"id":"6b513c11-2a4c-4052-ad06-34873c997f7a","block_type":"box","text":"A Fund may enter into an interest rate swap to effectively exchange with another party their respective","page_number":112,"box":{"x":116,"y":382,"width":764,"height":12}},{"id":"910310ee-ac0f-4cd7-b7bc-63ef1e4bc282","block_type":"box","text":"commitments to pay or receive interest,","page_number":112,"box":{"x":116,"y":397,"width":298,"height":12}},{"id":"fc0465e6-d65a-4f25-aa07-db4549abf0c1","block_type":"box","text":"e.g.","page_number":112,"box":{"x":415,"y":400,"width":26,"height":9}},{"id":"516a7af1-00b1-42ec-833d-53ac42a031bc","block_type":"box","text":", an exchange of fixed rate payments for floating rate","page_number":112,"box":{"x":444,"y":397,"width":396,"height":12}},{"id":"1e7cc231-71a0-4582-92aa-9cad0573cc62","block_type":"box","text":"payments. For example, if a Fund holds a mortgage-backed security with an interest rate that is reset","page_number":112,"box":{"x":117,"y":413,"width":755,"height":12}},{"id":"b47e3184-a436-4e4e-ab19-45263b849e73","block_type":"box","text":"only once each year, it may swap the right to receive interest at this fixed rate for the right to receive","page_number":112,"box":{"x":116,"y":428,"width":748,"height":12}},{"id":"e6d4db4f-96e8-40af-9d64-6f31ef471b61","block_type":"box","text":"interest at a rate that is reset every week. This would enable a Fund to offset a decline in the value of","page_number":112,"box":{"x":117,"y":444,"width":755,"height":12}},{"id":"e4ebc506-1b9a-43ff-be6f-560816dcf313","block_type":"box","text":"the mortgage-backed security due to rising interest rates but would also limit its ability to benefit from","page_number":112,"box":{"x":116,"y":459,"width":753,"height":12}},{"id":"8171b1c1-7d29-4cc0-8945-f8bfe24f3ad4","block_type":"box","text":"falling interest rates. Conversely, if a Fund holds a mortgage-backed security with an interest rate that","page_number":112,"box":{"x":116,"y":475,"width":761,"height":12}},{"id":"e7ccc062-127e-4ef9-8c6e-82134877609b","block_type":"box","text":"is reset every week and it would like to lock in what","page_number":112,"box":{"x":117,"y":490,"width":383,"height":12}},{"id":"a0b9fbdc-0ce7-4f4b-90b8-d3b722205dd6","block_type":"box","text":"it believes to be a high interest rate for one year, it","page_number":112,"box":{"x":501,"y":490,"width":377,"height":12}},{"id":"ea7b3a98-fae5-4b27-a9af-c76da3ca8400","block_type":"box","text":"may swap the right to receive interest at this variable weekly rate for the right to receive interest at a","page_number":112,"box":{"x":117,"y":506,"width":746,"height":12}},{"id":"9d28423b-9c4d-426a-969a-c9be7109515f","block_type":"box","text":"rate that is fixed for one year. Such a swap would protect the Fund from a reduction in yield due to","page_number":112,"box":{"x":117,"y":521,"width":733,"height":12}},{"id":"5919faaf-0fc2-49ac-94c3-58c8edcc1768","block_type":"box","text":"falling interest rates and may permit the Fund to enhance its income through the positive differential","page_number":112,"box":{"x":116,"y":537,"width":745,"height":12}},{"id":"e703988f-7fa3-48b5-9e41-cf4de02f4a66","block_type":"box","text":"between one week and one year interest rates, but would preclude it from taking full advantage of","page_number":112,"box":{"x":117,"y":552,"width":729,"height":12}},{"id":"b798ecb5-508a-4811-8fa2-fa0269d8646b","block_type":"box","text":"rising interest rates.","page_number":112,"box":{"x":117,"y":568,"width":150,"height":12}},{"id":"cb0a4e02-aa03-4580-a632-a95fad30ef8d","block_type":"box","text":"Gains from transactions in interest rate swaps distributed to shareholders will be taxable as ordinary","page_number":112,"box":{"x":117,"y":599,"width":746,"height":12}},{"id":"4fd63872-eebf-467f-ac29-34e905bb6785","block_type":"box","text":"income or, in certain circumstances, as long term capital gains to shareholders.","page_number":112,"box":{"x":117,"y":614,"width":593,"height":12}},{"id":"139936b8-9777-44a9-a7a0-1eb62d72e4b3","block_type":"box","text":"Interest rate swaps and interest rate caps and floors may be subject to correlation risk, leverage risk,","page_number":112,"box":{"x":117,"y":645,"width":751,"height":12}},{"id":"01c4ca05-1328-46ca-a8da-c0746094ee9f","block_type":"box","text":"illiquidity risk and market risk. See “—Risk Factors in Derivatives” above.","page_number":112,"box":{"x":117,"y":661,"width":538,"height":12}},{"id":"1a3827ba-4517-4568-bbd4-604d56201a2a","block_type":"box","text":"Total Return Swaps.","page_number":112,"box":{"x":118,"y":692,"width":148,"height":12}},{"id":"c449c873-1131-46c8-9fe9-0a97b0f19521","block_type":"box","text":"Total return swaps are contracts in which one party agrees to make periodic","page_number":112,"box":{"x":273,"y":692,"width":565,"height":12}},{"id":"28c12249-c7be-488b-9679-7bb5514a8713","block_type":"box","text":"payments to the other party based on the return of the assets underlying the contract in exchange for","page_number":112,"box":{"x":117,"y":707,"width":750,"height":12}},{"id":"b7c8719d-5822-4112-a2e7-64e05323ba56","block_type":"box","text":"periodic payments based on a fixed or variable interest rate or the total return from different underlying","page_number":112,"box":{"x":117,"y":723,"width":759,"height":12}},{"id":"bcf25b86-e654-4706-993b-edbaa61f7416","block_type":"box","text":"assets. The return of the assets underlying the contract includes both the income generated by the","page_number":112,"box":{"x":116,"y":738,"width":732,"height":12}},{"id":"66248fc6-f3b2-48cb-9584-0c69805aa194","block_type":"box","text":"asset and the change in market value of the asset. The asset underlying the contract may include a","page_number":112,"box":{"x":116,"y":754,"width":737,"height":12}},{"id":"f4e8612e-5831-4a84-9273-8fe63a60fb3b","block_type":"box","text":"specified security, basket of securities or securities indices. Total return swaps on a specified security,","page_number":112,"box":{"x":116,"y":769,"width":757,"height":12}},{"id":"055fbcce-d8da-41ba-ba87-cbc6b28d6f1a","block_type":"box","text":"basket of securities or securities indices may sometimes be referred to as “contracts for difference.”","page_number":112,"box":{"x":117,"y":785,"width":738,"height":12}},{"id":"83e3d3f1-2396-4a60-bbcf-0f68123cb063","block_type":"box","text":"Total return swaps may be used to obtain exposure to a security or market without owning or taking","page_number":112,"box":{"x":116,"y":816,"width":738,"height":12}},{"id":"72a4093c-91ba-4b3a-852e-26e143007f6b","block_type":"box","text":"physical custody of such security or investing directly in such market. Upon entering into a total return","page_number":112,"box":{"x":117,"y":831,"width":758,"height":12}},{"id":"3950778d-5d40-4d72-a5ff-e24602f37b35","block_type":"box","text":"swap, a Fund is required to deposit initial margin but the parties do not exchange the notional amount.","page_number":112,"box":{"x":116,"y":847,"width":763,"height":12}},{"id":"1832a1d6-7bf5-4a16-94a0-3f846c764c0b","block_type":"box","text":"As a result, total return swaps may effectively add leverage to the Fund’s portfolio because the Fund","page_number":112,"box":{"x":116,"y":862,"width":750,"height":12}},{"id":"d5b1ae11-8c03-452f-9df5-7620a92cfbdb","block_type":"box","text":"would be subject to investment exposure on the notional amount of the swap.","page_number":112,"box":{"x":116,"y":878,"width":580,"height":12}},{"id":"83dfd4fb-a290-4d01-99ca-87bd8742c26a","block_type":"box","text":"II-25","page_number":112,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"d2f99a58-4d85-404c-ada9-29227799d6e2","block_type":"box","text":"NM1026U-6004382-112/605","page_number":112,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9571f116-3e27-49d4-827c-8c093f11afe2","block_type":"box","text":"Total return swaps are subject to significant correlation risk, leverage risk, illiquidity risk, market risk","page_number":113,"box":{"x":116,"y":87,"width":743,"height":12}},{"id":"936850a5-6d87-4554-aafa-4b200ea6e220","block_type":"box","text":"and counterparty risk. See “—Risk Factors in Derivatives” above.","page_number":113,"box":{"x":116,"y":102,"width":488,"height":13}},{"id":"befb4edd-d0a6-4918-ae29-3771772e08a1","block_type":"box","text":"Options","page_number":113,"box":{"x":117,"y":143,"width":57,"height":12}},{"id":"bd336b9a-ce86-45f1-9af0-7d4ad4c569c1","block_type":"box","text":".","page_number":113,"box":{"x":175,"y":151,"width":8,"height":1}},{"id":"71b499f7-bd10-430c-b6cb-d0d0c08ffc94","block_type":"box","text":"Options on Securities and Securities Indices.","page_number":113,"box":{"x":117,"y":175,"width":337,"height":12}},{"id":"78228959-eb26-4866-9ea7-e92b3783605a","block_type":"box","text":"A Fund may engage in transactions in options on","page_number":113,"box":{"x":454,"y":175,"width":370,"height":12}},{"id":"fad68060-7f0a-4703-850c-137874bb06c2","block_type":"box","text":"individual securities, baskets of securities or securities indices, or particular measurements of value or","page_number":113,"box":{"x":117,"y":191,"width":761,"height":12}},{"id":"079d3f08-1378-4c47-bbbc-c3c1c51515d1","block_type":"box","text":"rates, such as an index of the price of treasury securities or an index representative of short-term","page_number":113,"box":{"x":117,"y":206,"width":724,"height":12}},{"id":"7e924978-3e87-4315-bbf2-470c2206ac52","block_type":"box","text":"interest rates. Such investments may be made on exchanges and in the OTC markets. In general,","page_number":113,"box":{"x":117,"y":222,"width":732,"height":12}},{"id":"dff28050-4ff2-41a7-bc54-12b0f6846e4d","block_type":"box","text":"exchange-traded options have standardized exercise prices and expiration dates and require the","page_number":113,"box":{"x":116,"y":237,"width":723,"height":12}},{"id":"dc991b87-9dfa-456c-b45a-20640bde79b5","block_type":"box","text":"parties to post margin against their obligations, and the performance of the parties’ obligations in","page_number":113,"box":{"x":117,"y":253,"width":720,"height":12}},{"id":"7762c3f6-75e3-433f-b000-945823dace31","block_type":"box","text":"connection with such options is guaranteed by the exchange or a related clearing corporation. OTC","page_number":113,"box":{"x":116,"y":268,"width":742,"height":12}},{"id":"d4e9970b-7ec8-4cfd-aeea-e60ef3d91e1c","block_type":"box","text":"options have more flexible terms negotiated between the buyer and the seller, but are subject to","page_number":113,"box":{"x":116,"y":284,"width":717,"height":12}},{"id":"73b2713e-1e9b-4eec-b0c0-fe4ae49e108f","block_type":"box","text":"greater credit risk. OTC options also involve greater illiquidity risk.","page_number":113,"box":{"x":116,"y":299,"width":493,"height":12}},{"id":"d8615f5c-c2ca-4b3c-89cc-b9a0b8f09e69","block_type":"box","text":"A Fund may also engage in transactions in options which have additional features that result in","page_number":113,"box":{"x":116,"y":331,"width":709,"height":12}},{"id":"e23c6e2f-9036-40da-b868-821557623d4d","block_type":"box","text":"different payment structures and/or expirations (commonly referred to as exotic options). For example,","page_number":113,"box":{"x":116,"y":347,"width":765,"height":12}},{"id":"1da9d7ad-a6ab-4245-a9d0-109c5a853a1e","block_type":"box","text":"barrier options are exotic options that can only be exercised (or automatically expire) if the price of the","page_number":113,"box":{"x":117,"y":362,"width":761,"height":12}},{"id":"9316e62d-d52c-4fb1-a269-b179c17ef331","block_type":"box","text":"underlying asset reaches one or more predetermined levels on or before expiration. Binary options are","page_number":113,"box":{"x":117,"y":378,"width":765,"height":12}},{"id":"999a30eb-3359-4a26-8448-a02cd613cc96","block_type":"box","text":"another example of exotic options which have a fixed all-or-nothing payout if one or more","page_number":113,"box":{"x":116,"y":393,"width":666,"height":12}},{"id":"428da686-7a81-4dd3-910f-90786d4dbfa9","block_type":"box","text":"predetermined conditions are met. Exotic options are typically traded in OTC markets.","page_number":113,"box":{"x":117,"y":409,"width":641,"height":12}},{"id":"af093f3e-ad40-4bc3-bead-1d77a36f9c7a","block_type":"box","text":"There are several risks associated with transactions in options on securities and indexes. For example,","page_number":113,"box":{"x":116,"y":441,"width":770,"height":12}},{"id":"0d91cca4-32c5-4b4d-abfb-d56387182a92","block_type":"box","text":"there are significant differences between the securities and options markets that could result in an","page_number":113,"box":{"x":116,"y":457,"width":731,"height":12}},{"id":"271e3aac-b9c7-4ec0-93dc-26ac4a788a52","block_type":"box","text":"imperfect correlation between these markets, causing a given transaction not to achieve its objectives.","page_number":113,"box":{"x":117,"y":472,"width":763,"height":12}},{"id":"8b5d34ec-1d05-4eac-af97-ac6d69a6255f","block_type":"box","text":"In addition, a liquid market for particular options, whether traded OTC or on a national securities","page_number":113,"box":{"x":117,"y":488,"width":716,"height":12}},{"id":"dbab631b-fa11-4709-919b-b29b477e8075","block_type":"box","text":"exchange (“Exchange”) may be absent for reasons which include the following: there may be","page_number":113,"box":{"x":116,"y":503,"width":695,"height":12}},{"id":"36c61757-1f5f-47d9-9ed9-4719f9d44b32","block_type":"box","text":"insufficient trading interest in certain options; restrictions may be imposed by an Exchange on opening","page_number":113,"box":{"x":117,"y":519,"width":763,"height":12}},{"id":"441f193c-05c5-490d-af9c-e4a12e7f9a81","block_type":"box","text":"transactions or closing transactions or both; trading halts, suspensions or other restrictions may be","page_number":113,"box":{"x":116,"y":534,"width":737,"height":12}},{"id":"db7c3ff5-c08c-48b7-a4dd-8d42712066ad","block_type":"box","text":"imposed with respect to particular classes or series of options or underlying securities; unusual or","page_number":113,"box":{"x":117,"y":550,"width":727,"height":12}},{"id":"6c41b09b-1f7d-44fe-9cd2-0d7d6294ce25","block_type":"box","text":"unforeseen circumstances may interrupt normal operations on an Exchange; the facilities of an","page_number":113,"box":{"x":117,"y":565,"width":708,"height":12}},{"id":"1ee6ec90-e360-4f6f-9aa4-89281983240f","block_type":"box","text":"Exchange or the Options Clearing Corporation may not at all times be adequate to handle current","page_number":113,"box":{"x":117,"y":581,"width":728,"height":12}},{"id":"cacdff84-5b8f-4f58-86ff-63340a07cca7","block_type":"box","text":"trading volume; or one or more Exchanges could, for economic or other reasons, decide or be","page_number":113,"box":{"x":116,"y":596,"width":703,"height":12}},{"id":"f5382446-c173-46f8-a314-24847e370784","block_type":"box","text":"compelled at some future date to discontinue the trading of options (or a particular class or series of","page_number":113,"box":{"x":116,"y":612,"width":746,"height":12}},{"id":"bfb6444b-2d83-4699-8898-d533d7e775d5","block_type":"box","text":"options), in which event the market on that Exchange (or in that class or series of options) would cease","page_number":113,"box":{"x":116,"y":627,"width":770,"height":12}},{"id":"04128e67-8ab2-4e28-9598-4e70bcbfbf01","block_type":"box","text":"to exist, although outstanding options that had been issued by the Options Clearing Corporation as a","page_number":113,"box":{"x":116,"y":643,"width":753,"height":12}},{"id":"8d03a698-2ece-4dbe-acd1-07873c35aae7","block_type":"box","text":"result of trades on that Exchange would continue to be exercisable in accordance with their terms.","page_number":113,"box":{"x":117,"y":658,"width":732,"height":12}},{"id":"7b20a794-3d1d-4214-93af-e94078da6964","block_type":"box","text":"Each of the options exchanges has established limitations governing the maximum number of call or","page_number":113,"box":{"x":117,"y":690,"width":745,"height":12}},{"id":"46f6d1ea-18cd-4143-808b-e190d1771ec5","block_type":"box","text":"put options on the same asset that may be bought or written by a single investor, whether acting alone","page_number":113,"box":{"x":117,"y":706,"width":759,"height":12}},{"id":"49f54875-8e48-4414-a3f7-37b2a306ebfa","block_type":"box","text":"or in concert with others (regardless of whether such options are written on the same or different","page_number":113,"box":{"x":116,"y":721,"width":716,"height":12}},{"id":"e036e69c-8d97-4ec1-bd7a-6fdd144b71a4","block_type":"box","text":"exchanges or are held or written on one or more accounts or through one or more brokers). Under","page_number":113,"box":{"x":116,"y":737,"width":730,"height":12}},{"id":"b66b3bf5-4f6b-4c51-b045-071a674a29a8","block_type":"box","text":"these limitations, option positions of all investment companies advised by the Manager are combined","page_number":113,"box":{"x":116,"y":752,"width":749,"height":12}},{"id":"f6f8cc03-36c8-4f11-8c8f-5303954c5348","block_type":"box","text":"for purposes of these limits. Pursuant to these limitations, an exchange may order the liquidation of","page_number":113,"box":{"x":116,"y":768,"width":736,"height":12}},{"id":"7b526fd6-8ee9-4913-bebf-6ba2c5dbc650","block_type":"box","text":"positions and may impose other sanctions or restrictions. These position limits may restrict the number","page_number":113,"box":{"x":117,"y":783,"width":762,"height":12}},{"id":"55d3d294-c875-45e6-bb08-f35b8d22f5cd","block_type":"box","text":"of listed options that a Fund may buy or sell.","page_number":113,"box":{"x":116,"y":799,"width":328,"height":12}},{"id":"0c2b6f80-f17e-4c91-b98d-12d7a54ec1e2","block_type":"box","text":"Call Options.","page_number":113,"box":{"x":117,"y":831,"width":100,"height":12}},{"id":"05142981-a842-45f0-a472-2e23a024ccd5","block_type":"box","text":"A Fund may purchase call options on any of the types of securities or instruments in","page_number":113,"box":{"x":217,"y":831,"width":629,"height":12}},{"id":"8f6755e9-179b-4cef-9b44-85bf740fab63","block_type":"box","text":"which it may invest. A purchased call option gives a Fund the right to buy, and obligates the seller to","page_number":113,"box":{"x":116,"y":847,"width":748,"height":12}},{"id":"9952c54d-d8bc-4660-a880-3b1b5b4e52e9","block_type":"box","text":"sell, the underlying security at the exercise price at any time during the option period. A Fund also may","page_number":113,"box":{"x":116,"y":862,"width":767,"height":12}},{"id":"7586a434-cf92-454a-b1c7-522fbcfafd80","block_type":"box","text":"purchase and sell call options on indices. Index options are similar to options on securities except that,","page_number":113,"box":{"x":117,"y":878,"width":765,"height":11}},{"id":"6f0b7e31-5776-4a4d-ad55-05d0772ec971","block_type":"box","text":"II-26","page_number":113,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"89e980e1-cf9d-47ea-ba12-486114bbc44a","block_type":"box","text":"NM1026U-6004382-113/605","page_number":113,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f5231b82-3065-428f-bc2a-5e01e2a01b7e","block_type":"box","text":"rather than taking or making delivery of securities underlying the option at a specified price upon","page_number":114,"box":{"x":117,"y":87,"width":718,"height":12}},{"id":"1ad9aea0-051c-42b0-a9c5-dab4d6f0c8ca","block_type":"box","text":"exercise, an index option gives the holder the right to receive cash upon exercise of the option if the","page_number":114,"box":{"x":116,"y":102,"width":745,"height":13}},{"id":"93a1201e-f248-495c-bdaa-dc2e0bb0585a","block_type":"box","text":"level of the index upon which the option is based is greater than the exercise price of the option.","page_number":114,"box":{"x":117,"y":118,"width":716,"height":12}},{"id":"7f303e71-9942-411a-9169-b3c9d5bfc970","block_type":"box","text":"A written call option is covered if a Fund holds a call on the same security or index as the call written","page_number":114,"box":{"x":116,"y":146,"width":750,"height":12}},{"id":"e3c21731-a20d-47d8-8b2d-f79429d9fc64","block_type":"box","text":"where the exercise price of the call held is (i) equal to or less than the exercise price of the call written,","page_number":114,"box":{"x":116,"y":161,"width":765,"height":13}},{"id":"b59a47f5-cc23-4d2c-a4b5-1139ce011256","block_type":"box","text":"or (ii) greater than the exercise price of the call written provided the difference is maintained by the","page_number":114,"box":{"x":116,"y":177,"width":736,"height":12}},{"id":"75913afd-d035-438c-8c1c-de409b51a1a6","block_type":"box","text":"Fund in assets which are not considered illiquid investments under the Funds’ Liquidity Program (as","page_number":114,"box":{"x":117,"y":192,"width":745,"height":13}},{"id":"c4de33b1-019d-4e1b-9b0d-0a79c0d916d6","block_type":"box","text":"defined below) (“liquid assets”) designated on the Manager’s or the sub-adviser’s books and records to","page_number":114,"box":{"x":116,"y":208,"width":769,"height":12}},{"id":"457b5453-05c4-488d-953c-8fd32a8dc484","block_type":"box","text":"the extent required by Commission guidelines.","page_number":114,"box":{"x":116,"y":223,"width":350,"height":13}},{"id":"2e6927ca-94e0-4ece-abb5-ae801d499db2","block_type":"box","text":"A Fund may write (","page_number":114,"box":{"x":116,"y":251,"width":140,"height":12}},{"id":"d21e3132-da3a-46a0-a524-561f8fa05bf3","block_type":"box","text":"i.e.","page_number":114,"box":{"x":257,"y":251,"width":21,"height":10}},{"id":"61230941-a968-4947-b831-6aec050a73b9","block_type":"box","text":", sell) covered call options on the securities or instruments in which it may invest","page_number":114,"box":{"x":281,"y":251,"width":599,"height":12}},{"id":"5abd0b2f-c81c-4fc4-b04a-bc234cd9e573","block_type":"box","text":"and to enter into closing purchase transactions with respect to certain of such options. A covered call","page_number":114,"box":{"x":116,"y":267,"width":754,"height":12}},{"id":"9032f1ed-a6bc-4a73-9dfd-83fd2d0dd6d7","block_type":"box","text":"option is an option in which a Fund, in return for a premium, gives another party a right to buy specified","page_number":114,"box":{"x":116,"y":282,"width":769,"height":12}},{"id":"01acb7b5-fffa-4303-b7ef-abc028f3da84","block_type":"box","text":"securities owned by the Fund at a specified future date and price set at the time of the contract. The","page_number":114,"box":{"x":116,"y":298,"width":747,"height":12}},{"id":"56ed5ada-b0c7-46cb-a293-e57802e357b9","block_type":"box","text":"principal reason for writing call options is the attempt to realize, through the receipt of premiums, a","page_number":114,"box":{"x":117,"y":313,"width":733,"height":12}},{"id":"8cfd35a4-576a-4519-a697-e1c2ec472713","block_type":"box","text":"greater return than would be realized on the securities alone. By writing covered call options, a Fund","page_number":114,"box":{"x":116,"y":329,"width":750,"height":12}},{"id":"f5c775f6-2b10-4d99-847b-671cf4edd2f3","block_type":"box","text":"gives up the opportunity, while the option is in effect, to profit from any price increase in the underlying","page_number":114,"box":{"x":116,"y":344,"width":763,"height":12}},{"id":"dac08016-2376-4670-964e-23607dd67716","block_type":"box","text":"security above the option exercise price. In addition, a Fund’s ability to sell the underlying security will","page_number":114,"box":{"x":116,"y":360,"width":758,"height":12}},{"id":"8cf4ad83-1d03-4785-a79c-f8c6b7926202","block_type":"box","text":"be limited while the option is in effect unless the Fund enters into a closing purchase transaction. A","page_number":114,"box":{"x":117,"y":375,"width":738,"height":12}},{"id":"f409bbed-381b-4d08-bbe1-35c3e4dd154c","block_type":"box","text":"closing purchase transaction cancels out a Fund’s position as the writer of an option by means of an","page_number":114,"box":{"x":116,"y":391,"width":748,"height":12}},{"id":"0c95b8bf-378d-4435-9b5e-a56fae45a8e2","block_type":"box","text":"offsetting purchase of an identical option prior to the expiration of the option it has written. Covered call","page_number":114,"box":{"x":116,"y":406,"width":768,"height":12}},{"id":"3fc70c3c-b30b-4ba2-97c3-25bb8a9571f4","block_type":"box","text":"options also serve as a partial hedge to the extent of the premium received against the price of the","page_number":114,"box":{"x":116,"y":422,"width":736,"height":12}},{"id":"3618a2f9-c52e-4ce0-b84a-7d3853a22f66","block_type":"box","text":"underlying security declining.","page_number":114,"box":{"x":117,"y":438,"width":219,"height":11}},{"id":"c76be819-bac6-48b2-b5ee-99b4961b5084","block_type":"box","text":"A Fund may write (","page_number":114,"box":{"x":116,"y":465,"width":140,"height":12}},{"id":"c5720199-d334-45c1-85e3-c116369df641","block_type":"box","text":"i.e.","page_number":114,"box":{"x":257,"y":465,"width":21,"height":10}},{"id":"4916a85a-ac61-44f4-b783-8173786e3335","block_type":"box","text":", sell) uncovered call options on securities or instruments in which it may invest","page_number":114,"box":{"x":281,"y":465,"width":590,"height":12}},{"id":"fb0617a4-0297-48bf-b9b3-ad0f62c17124","block_type":"box","text":"but that are not currently held by the Fund. The principal reason for writing uncovered call options is to","page_number":114,"box":{"x":117,"y":481,"width":763,"height":12}},{"id":"badd3344-d03c-434b-b5ff-5c0082684926","block_type":"box","text":"realize income without committing capital to the ownership of the underlying securities or instruments.","page_number":114,"box":{"x":117,"y":496,"width":758,"height":12}},{"id":"f2f29faa-1916-4e73-af21-cf1631d00fc2","block_type":"box","text":"When writing uncovered call options, a Fund must deposit and maintain sufficient margin with the","page_number":114,"box":{"x":116,"y":512,"width":727,"height":12}},{"id":"cbe2a1f0-8aa4-44cc-8755-deb0dc91c2af","block_type":"box","text":"broker-dealer through which it made the uncovered call option as collateral to ensure that the securities","page_number":114,"box":{"x":117,"y":527,"width":771,"height":12}},{"id":"caa8fb96-6e9d-459c-8393-1c334c8b23dc","block_type":"box","text":"can be purchased for delivery if and when the option is exercised. During periods of declining","page_number":114,"box":{"x":116,"y":543,"width":697,"height":12}},{"id":"bf1ff205-e868-476b-b204-c053c43b4e02","block_type":"box","text":"securities prices or when prices are stable, writing uncovered calls can be a profitable strategy to","page_number":114,"box":{"x":116,"y":558,"width":724,"height":12}},{"id":"c4fb5241-bc66-4d05-99bb-48632348b148","block_type":"box","text":"increase a Fund’s income with minimal capital risk. Uncovered calls are riskier than covered calls","page_number":114,"box":{"x":117,"y":574,"width":724,"height":12}},{"id":"522b87cd-a541-42c9-a0ab-8669e45b51cb","block_type":"box","text":"because there is no underlying security held by a Fund that can act as a partial hedge. Uncovered calls","page_number":114,"box":{"x":117,"y":589,"width":771,"height":12}},{"id":"7d1676fd-fbd4-4698-9dd1-7bdfe1c1d521","block_type":"box","text":"have speculative characteristics and the potential for loss is unlimited. When an uncovered call is","page_number":114,"box":{"x":117,"y":605,"width":725,"height":12}},{"id":"ce6f1ab1-a650-4b68-866b-a81209c44917","block_type":"box","text":"exercised, a Fund must purchase the underlying security to meet its call obligation. There is also a risk,","page_number":114,"box":{"x":116,"y":620,"width":771,"height":12}},{"id":"56010264-bbc3-4009-8ad0-1ab406a3abbf","block_type":"box","text":"especially with preferred and debt securities that lack sufficient liquidity, that the securities may not be","page_number":114,"box":{"x":116,"y":636,"width":760,"height":12}},{"id":"470ef66b-7980-4b8b-aebb-cbd7470279ec","block_type":"box","text":"available for purchase. If the purchase price exceeds the exercise price, a Fund will lose the difference.","page_number":114,"box":{"x":116,"y":651,"width":772,"height":12}},{"id":"a3f2112e-8d1e-44e4-b3c7-de9f10dc4d52","block_type":"box","text":"Put Options.","page_number":114,"box":{"x":116,"y":679,"width":91,"height":12}},{"id":"d4bf77b6-1ec7-4ec4-b05c-b27f111377e0","block_type":"box","text":"A Fund may purchase put options to seek to hedge against a decline in the value of its","page_number":114,"box":{"x":213,"y":679,"width":642,"height":12}},{"id":"85ff8691-4f64-446b-9c6c-b42325b77258","block_type":"box","text":"securities or to enhance its return. By buying a put option, a Fund acquires a right to sell the underlying","page_number":114,"box":{"x":116,"y":695,"width":764,"height":12}},{"id":"b9ba17e0-7ef8-46f1-9ab8-689cd06288dd","block_type":"box","text":"securities or instruments at the exercise price, thus limiting the Fund’s risk of loss through a decline in","page_number":114,"box":{"x":116,"y":710,"width":754,"height":12}},{"id":"94ba5a72-f684-4ff0-b695-542b93313fc5","block_type":"box","text":"the market value of the securities or instruments until the put option expires. The amount of any","page_number":114,"box":{"x":116,"y":726,"width":709,"height":12}},{"id":"91c5ecea-938b-446e-991b-8c68da866715","block_type":"box","text":"appreciation in the value of the underlying securities or instruments will be partially offset by the","page_number":114,"box":{"x":116,"y":741,"width":708,"height":12}},{"id":"80b268d6-e7c1-4fb2-97b4-03594fe45e57","block_type":"box","text":"amount of the premium paid for the put option and any related transaction costs. Prior to its expiration,","page_number":114,"box":{"x":116,"y":757,"width":758,"height":12}},{"id":"bb16e065-9bd2-462f-b768-4c2acd814f75","block_type":"box","text":"a put option may be sold in a closing sale transaction and profit or loss from the sale will depend on","page_number":114,"box":{"x":116,"y":772,"width":737,"height":12}},{"id":"d235f34d-7075-48bd-9fc4-f6a84d84e8e5","block_type":"box","text":"whether the amount received is more or less than the premium paid for the put option plus the related","page_number":114,"box":{"x":116,"y":788,"width":753,"height":12}},{"id":"af56a2d0-868f-44bb-a5b5-a3297eae3049","block_type":"box","text":"transaction costs. A closing sale transaction cancels out a Fund’s position as the purchaser of an","page_number":114,"box":{"x":116,"y":803,"width":719,"height":12}},{"id":"c6c53a30-c629-4484-81a3-16e3d3621653","block_type":"box","text":"option by means of an offsetting sale of an identical option prior to the expiration of the option it has","page_number":114,"box":{"x":116,"y":819,"width":737,"height":12}},{"id":"79dad496-0fb5-4456-bb5a-b0a811e99b5f","block_type":"box","text":"purchased. A Fund also may purchase uncovered put options.","page_number":114,"box":{"x":117,"y":834,"width":467,"height":12}},{"id":"584f98bc-c02f-4018-bef0-4c4cd820aca7","block_type":"box","text":"A Fund also may write (","page_number":114,"box":{"x":116,"y":862,"width":176,"height":12}},{"id":"02f6f8b6-64b9-4ff3-87a5-4be75d47449e","block_type":"box","text":"i.e.","page_number":114,"box":{"x":293,"y":862,"width":20,"height":10}},{"id":"37decf90-1cd0-4787-9c00-e57e290dbfa7","block_type":"box","text":", sell) put options on the types of securities or instruments that may be held","page_number":114,"box":{"x":316,"y":862,"width":563,"height":12}},{"id":"5c9d9495-a044-493e-bfec-80851b0c72ab","block_type":"box","text":"by the Fund. A Fund will receive a premium for writing a put option, which increases the Fund’s return.","page_number":114,"box":{"x":117,"y":878,"width":763,"height":12}},{"id":"d5b446bf-4999-4957-a8c9-48b12e6ab776","block_type":"box","text":"II-27","page_number":114,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"787836d3-b1aa-4659-b284-6a8bc6433bcd","block_type":"box","text":"NM1026U-6004382-114/605","page_number":114,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a529da2b-b661-40ad-a31c-31d37d5c89b0","block_type":"box","text":"A Fund also may write (","page_number":115,"box":{"x":116,"y":87,"width":176,"height":12}},{"id":"8cc31a84-8483-45de-835b-a719e85da7bd","block_type":"box","text":"i.e.","page_number":115,"box":{"x":293,"y":87,"width":20,"height":10}},{"id":"13d07b3b-6670-402f-8ce9-2ffa7efa2442","block_type":"box","text":", sell) uncovered put options on securities or instruments in which it may","page_number":115,"box":{"x":316,"y":87,"width":540,"height":12}},{"id":"1b7e3b66-16c9-4940-a14a-a01a4bc42eff","block_type":"box","text":"invest but with respect to which the Fund does not currently have a corresponding short position or has","page_number":115,"box":{"x":117,"y":103,"width":769,"height":12}},{"id":"3d6db09f-f3cf-4fb9-8010-b4feb7d5ed77","block_type":"box","text":"not deposited as collateral cash equal to the exercise value of the put option with the broker-dealer","page_number":115,"box":{"x":117,"y":118,"width":737,"height":12}},{"id":"b26f55e5-542e-44ec-bd7e-c7002baba78f","block_type":"box","text":"through which it made the uncovered put option. The principal reason for writing uncovered put options","page_number":115,"box":{"x":116,"y":134,"width":769,"height":12}},{"id":"67e06eb4-2566-4576-9de4-1122427c19ef","block_type":"box","text":"is to receive premium income and to acquire such securities or instruments at a net cost below the","page_number":115,"box":{"x":117,"y":149,"width":734,"height":12}},{"id":"87930df7-dd02-4062-8da1-f7a8fb7ba5b5","block_type":"box","text":"current market value. A Fund has the obligation to buy the securities or instruments at an agreed upon","page_number":115,"box":{"x":116,"y":165,"width":765,"height":12}},{"id":"5e4de3c6-faa0-4270-977b-ab2f7a20a36e","block_type":"box","text":"price if the price of the securities or instruments decreases below the exercise price. If the price of the","page_number":115,"box":{"x":117,"y":180,"width":759,"height":12}},{"id":"65622eed-5d9f-44fe-b0eb-3f0eb5f0937a","block_type":"box","text":"securities or instruments increases during the option period, the option will expire worthless and a","page_number":115,"box":{"x":116,"y":196,"width":729,"height":12}},{"id":"ea77b492-9b78-4e9d-8a56-3f8deeeca704","block_type":"box","text":"Fund will retain the premium and will not have to purchase the securities or instruments at the exercise","page_number":115,"box":{"x":117,"y":211,"width":767,"height":12}},{"id":"0a65046c-82a0-49b5-9513-23ffb8c0c6a8","block_type":"box","text":"price.","page_number":115,"box":{"x":117,"y":227,"width":45,"height":11}},{"id":"93222493-2a17-433a-b6d9-c03de8b1c908","block_type":"box","text":"Options on Government National Mortgage Association (“GNMA”) Certificates.","page_number":115,"box":{"x":117,"y":258,"width":586,"height":12}},{"id":"07c81eec-c936-4f97-8c65-e2ebd62ce80b","block_type":"box","text":"The following","page_number":115,"box":{"x":704,"y":258,"width":103,"height":12}},{"id":"d271631f-56b6-495e-b150-1fa3512b0e31","block_type":"box","text":"information relates to the unique characteristics of options on GNMA Certificates. Since the remaining","page_number":115,"box":{"x":117,"y":273,"width":759,"height":12}},{"id":"8e2c889e-4e2d-4dae-8898-d292062150bd","block_type":"box","text":"principal balance of GNMA Certificates declines each month as a result of mortgage payments, a","page_number":115,"box":{"x":117,"y":289,"width":725,"height":12}},{"id":"eb9ba186-4f59-46fc-b0ce-eeca4a58f1aa","block_type":"box","text":"Fund, as a writer of a GNMA call holding GNMA Certificates as “cover” to satisfy its delivery obligation","page_number":115,"box":{"x":117,"y":304,"width":761,"height":12}},{"id":"78921877-9940-4c9a-9650-bb009d1b37a3","block_type":"box","text":"in the event of exercise, may find that the GNMA Certificates it holds no longer have a sufficient","page_number":115,"box":{"x":117,"y":320,"width":714,"height":12}},{"id":"193febe8-77d8-4db8-a6a6-fa11350f013a","block_type":"box","text":"remaining principal balance for this purpose. Should this occur, a Fund will purchase additional GNMA","page_number":115,"box":{"x":117,"y":335,"width":763,"height":12}},{"id":"5c30a925-6d9c-41fe-bbb2-66a071a6e060","block_type":"box","text":"Certificates from the same pool (if obtainable) or other GNMA Certificates in the cash market in order","page_number":115,"box":{"x":117,"y":351,"width":754,"height":12}},{"id":"7edb5eef-5f9c-4886-bcec-2914fcca9d52","block_type":"box","text":"to maintain its “cover.”","page_number":115,"box":{"x":116,"y":366,"width":170,"height":10}},{"id":"fd468ab0-d49f-41ad-a424-c3b1b031e9a5","block_type":"box","text":"A GNMA Certificate held by a Fund to cover an option position in any but the nearest expiration month","page_number":115,"box":{"x":116,"y":397,"width":764,"height":12}},{"id":"7961e516-78a2-4d98-9ed1-de2d90ffd864","block_type":"box","text":"may cease to represent cover for the option in the event of a decline in the GNMA coupon rate at","page_number":115,"box":{"x":117,"y":413,"width":724,"height":12}},{"id":"475cd180-e525-4d5d-a5e7-3db5494b239b","block_type":"box","text":"which new pools are originated under the FHA/VA loan ceiling in effect at any given time. If this should","page_number":115,"box":{"x":116,"y":428,"width":765,"height":12}},{"id":"201b7964-a6d5-410b-be77-c3716b006911","block_type":"box","text":"occur, a Fund will no longer be covered, and the Fund will either enter into a closing purchase","page_number":115,"box":{"x":116,"y":444,"width":701,"height":12}},{"id":"98087224-918c-489f-bf4e-3ddfd399de37","block_type":"box","text":"transaction or replace such Certificate with a certificate that represents cover. When a Fund closes its","page_number":115,"box":{"x":116,"y":459,"width":760,"height":12}},{"id":"3f14f920-1693-42ca-87ce-45e0c000264f","block_type":"box","text":"position or replaces such Certificate, it may realize an unanticipated loss and incur transaction costs.","page_number":115,"box":{"x":117,"y":475,"width":751,"height":12}},{"id":"ee0999fa-efb2-46a2-88eb-9a16229c87b7","block_type":"box","text":"Options on Swaps (“Swaptions”).","page_number":115,"box":{"x":117,"y":506,"width":243,"height":12}},{"id":"592405c0-1d02-404e-a46f-c37df5773098","block_type":"box","text":"A swaption gives a counterparty the option (but not the obligation) to","page_number":115,"box":{"x":362,"y":506,"width":517,"height":12}},{"id":"7575a535-d2e2-4540-b3c5-e630cdd3ab69","block_type":"box","text":"enter into a new swap agreement or to shorten, extend, cancel or otherwise modify an existing swap","page_number":115,"box":{"x":116,"y":521,"width":750,"height":12}},{"id":"c9d62619-7c4b-4a11-b9cb-17fd3366a609","block_type":"box","text":"agreement, at a designated future time on specified terms. A Fund may write (","page_number":115,"box":{"x":116,"y":537,"width":580,"height":12}},{"id":"47a2c4a1-314b-4b62-adb9-d92ea9ee22b3","block_type":"box","text":"i.e.","page_number":115,"box":{"x":698,"y":537,"width":20,"height":9}},{"id":"d2945156-bec5-4a91-a399-9a23bf3c6a5f","block_type":"box","text":", sell) and purchase","page_number":115,"box":{"x":721,"y":537,"width":150,"height":12}},{"id":"6c94b76d-72a7-437a-b85c-38b4cd7cb45f","block_type":"box","text":"put and call swaptions. Depending on the terms of the particular option agreement, a Fund will","page_number":115,"box":{"x":117,"y":552,"width":704,"height":12}},{"id":"ef275619-1999-4f31-af37-e764491c6612","block_type":"box","text":"generally incur a greater degree of risk when it writes a swaption than it will incur when it purchases a","page_number":115,"box":{"x":116,"y":568,"width":758,"height":12}},{"id":"be3a43f1-37f3-482a-a96d-bdd80d340c3e","block_type":"box","text":"swaption. When a Fund purchases a swaption, it risks losing only the amount of the premium it has","page_number":115,"box":{"x":116,"y":583,"width":741,"height":12}},{"id":"4eacabb5-3f41-4d38-a618-8819e41a119e","block_type":"box","text":"paid should it decide to let the option expire unexercised. However, when a Fund writes a swaption,","page_number":115,"box":{"x":117,"y":599,"width":743,"height":12}},{"id":"c08847c0-ceb8-4dcd-85cb-85f5f86bc09b","block_type":"box","text":"upon exercise of the option the Fund will become obligated according to the terms of the underlying","page_number":115,"box":{"x":117,"y":614,"width":743,"height":12}},{"id":"8320cc92-876a-4177-8182-477ae1bb6637","block_type":"box","text":"agreement and the potential for loss may be unlimited. Certain swaptions are permitted, although not","page_number":115,"box":{"x":116,"y":630,"width":754,"height":12}},{"id":"b189e6da-ac3a-4de1-bf5a-e31bb409e541","block_type":"box","text":"required, to be cleared.","page_number":115,"box":{"x":117,"y":645,"width":177,"height":12}},{"id":"a98faf21-b3ad-4f74-8964-8e50a38633c2","block_type":"box","text":"A Fund will likely enter into these transactions to preserve a return or spread on a particular investment","page_number":115,"box":{"x":116,"y":676,"width":765,"height":12}},{"id":"2413f57f-4dd1-40f3-aeca-b5a574b01924","block_type":"box","text":"or portion of its portfolio or to protect against any increase in the price of securities the Fund anticipates","page_number":115,"box":{"x":116,"y":692,"width":767,"height":12}},{"id":"3b4a3105-e245-43a1-8f5a-d4d9254fd490","block_type":"box","text":"purchasing at a later date. A Fund generally will use these transactions for hedging purposes, not for","page_number":115,"box":{"x":117,"y":707,"width":746,"height":12}},{"id":"b9cc7517-997d-4074-b559-bd411ad43e7f","block_type":"box","text":"speculation.","page_number":115,"box":{"x":116,"y":723,"width":88,"height":12}},{"id":"240dac3a-7f5a-48d0-a2ae-40638a51fb0e","block_type":"box","text":"Swaptions may be subject to correlation risk, leverage risk, illiquidity risk and market risk. See “— Risk","page_number":115,"box":{"x":116,"y":754,"width":760,"height":12}},{"id":"13722fbb-de5c-4d59-b343-045aaed09079","block_type":"box","text":"Factors in Derivatives” above.","page_number":115,"box":{"x":117,"y":769,"width":220,"height":10}},{"id":"2dc0b69a-46e6-4005-a404-04902a825657","block_type":"box","text":"FLEX Options.","page_number":115,"box":{"x":116,"y":800,"width":107,"height":12}},{"id":"7cdd0e5e-b2dd-4398-a658-1244d67d3095","block_type":"box","text":"FLEX Options are customized option contracts available through national securities","page_number":115,"box":{"x":231,"y":800,"width":617,"height":12}},{"id":"24e77703-196a-4700-96cd-482425e3d732","block_type":"box","text":"exchanges that are guaranteed for settlement by the Options Clearing Corporation (“OCC”). FLEX","page_number":115,"box":{"x":116,"y":816,"width":729,"height":12}},{"id":"5babdadb-48ed-4474-b8a2-2e077cfa60e0","block_type":"box","text":"Options are listed on a U.S. national securities exchange. FLEX Options provide investors with the","page_number":115,"box":{"x":116,"y":831,"width":736,"height":12}},{"id":"ad923124-2afb-4dea-beb7-9727c90803ba","block_type":"box","text":"ability to customize assets referenced by the options, exercise prices, exercise styles (i.e., American","page_number":115,"box":{"x":116,"y":847,"width":750,"height":12}},{"id":"b429587c-d2de-4939-88f8-0a3108f9ed5d","block_type":"box","text":"style, exercisable any time prior to the expiration date, or European-style, exercisable only on the","page_number":115,"box":{"x":116,"y":862,"width":726,"height":12}},{"id":"355da5fe-eb0e-41d6-b9d4-29af6d8d73aa","block_type":"box","text":"option expiration date) and expiration dates, while achieving price discovery in competitive, transparent","page_number":115,"box":{"x":116,"y":878,"width":769,"height":12}},{"id":"9b0340c9-4c08-40da-93c3-095feb02e232","block_type":"box","text":"II-28","page_number":115,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"4189e65e-c926-48c1-93c9-ab2e12ca0b47","block_type":"box","text":"NM1026U-6004382-115/605","page_number":115,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c5bbb1f0-a2a6-4180-94dc-81cb114a1e4d","block_type":"box","text":"auctions markets and avoiding the counterparty exposure of OTC options positions. Each option","page_number":116,"box":{"x":116,"y":87,"width":719,"height":12}},{"id":"216d8c1a-3e41-43e1-9386-0ea5cfac991a","block_type":"box","text":"contract entitles the holder thereof to purchase (for the","page_number":116,"box":{"x":116,"y":102,"width":410,"height":13}},{"id":"dc3e36ba-21ca-43e2-a363-eb0e7814784a","block_type":"box","text":"call options) or sell (for the put options) shares","page_number":116,"box":{"x":527,"y":102,"width":349,"height":13}},{"id":"631af52a-4181-4b54-a383-c49ce4336520","block_type":"box","text":"of the reference asset at the strike price. A Fund’s portfolio may include several types of FLEX Options,","page_number":116,"box":{"x":116,"y":118,"width":772,"height":12}},{"id":"d97ea185-9f26-41b7-9e2e-3689202bf3c6","block_type":"box","text":"including both purchased and written put and call options (as further described below). The FLEX","page_number":116,"box":{"x":117,"y":134,"width":726,"height":12}},{"id":"41d9476d-33b9-458a-8093-24200417dc9f","block_type":"box","text":"Options are all European style options, which means that they are exercisable at a predetermined","page_number":116,"box":{"x":116,"y":149,"width":730,"height":12}},{"id":"47a4f39e-ea49-4aca-b934-138d05d8289a","block_type":"box","text":"specified price (the “strike price”) only on the FLEX Option’s expiration date.","page_number":116,"box":{"x":116,"y":165,"width":569,"height":12}},{"id":"0b0a6ca6-72e8-47d4-a113-7fbe7e74daea","block_type":"box","text":"The OCC guarantees performance by each of the counterparties to the FLEX Options, becoming the","page_number":116,"box":{"x":116,"y":198,"width":752,"height":12}},{"id":"10df0626-efb7-48fc-8e20-a5e21e288679","block_type":"box","text":"“buyer for every seller and the seller for every buyer”, reducing counterparty risk for clearing members","page_number":116,"box":{"x":116,"y":213,"width":762,"height":12}},{"id":"878da5e7-1976-46c2-ba81-63f17f9996d6","block_type":"box","text":"and options traders. Although guaranteed for settlement by the OCC, FLEX Options are still subject to","page_number":116,"box":{"x":116,"y":229,"width":762,"height":12}},{"id":"379d54d6-def8-4694-b2cc-7832452a0c1d","block_type":"box","text":"counterparty risk with the OCC and subject to the risk that the OCC may fail to perform the settlement","page_number":116,"box":{"x":116,"y":244,"width":760,"height":12}},{"id":"c5d35a15-7ba5-44fd-af8c-6418ebc940d2","block_type":"box","text":"of the FLEX Options due to bankruptcy or other adverse reasons. A Fund bears the risk that the OCC","page_number":116,"box":{"x":116,"y":260,"width":759,"height":12}},{"id":"a26820d2-be6f-4833-8fea-1ea546a65299","block_type":"box","text":"will be unable or unwilling to perform its obligations under the FLEX Options contracts.","page_number":116,"box":{"x":116,"y":275,"width":646,"height":12}},{"id":"c35edd3c-4f54-4005-a00c-52459f4e7f17","block_type":"box","text":"Subject to determination by the Securities Committee of the OCC, adjustments may be made to the","page_number":116,"box":{"x":116,"y":308,"width":744,"height":13}},{"id":"0a45cc33-0db0-4089-98b6-863038f9ea2e","block_type":"box","text":"FLEX Options for certain events (collectively, “Corporate Actions”) specified in the OCC’s by-laws and","page_number":116,"box":{"x":117,"y":324,"width":760,"height":12}},{"id":"9cd86caa-1f7d-4655-aace-92f3adb532d6","block_type":"box","text":"rules: certain stock dividends or distributions, stock splits, reverse stock splits, rights offerings,","page_number":116,"box":{"x":117,"y":339,"width":702,"height":13}},{"id":"eda19b7e-ba1d-498d-b026-bb3633a6d23e","block_type":"box","text":"distributions, reorganizations, recapitalizations, or reclassifications with respect to an underlying","page_number":116,"box":{"x":116,"y":355,"width":715,"height":12}},{"id":"10b04556-8176-4920-8442-5bbffb379a9e","block_type":"box","text":"security, or a merger, consolidation, dissolution or liquidation of the issuer of the underlying security.","page_number":116,"box":{"x":116,"y":370,"width":748,"height":13}},{"id":"175bbe5f-8c22-4fcb-afa4-6d61096829c2","block_type":"box","text":"According to the OCC’s by-laws, the nature and extent of any such adjustment is to be determined by","page_number":116,"box":{"x":116,"y":386,"width":759,"height":12}},{"id":"d08449ca-5fa9-4c9e-94f7-8f1a00d2cdfe","block_type":"box","text":"the OCC’s Securities Committee, in light of the circumstances known to it at the time such","page_number":116,"box":{"x":116,"y":401,"width":673,"height":13}},{"id":"12a63450-0f3b-47a8-9c44-af5e37a2434f","block_type":"box","text":"determination is made, based on its judgment as to what is appropriate for the protection of investors","page_number":116,"box":{"x":116,"y":417,"width":754,"height":12}},{"id":"b0fd64d0-1ef0-4caa-9ff0-662ca82e4f7a","block_type":"box","text":"and the public interest, taking into account such factors as fairness to holders and writers (or","page_number":116,"box":{"x":116,"y":432,"width":691,"height":13}},{"id":"1079fe3d-6ba1-47c2-9e06-ad0d9138d7b2","block_type":"box","text":"purchasers and sellers) of the affected options, the maintenance of a fair and orderly market in the","page_number":116,"box":{"x":117,"y":448,"width":734,"height":12}},{"id":"cab656be-0e2c-4a19-8ee6-ad10d1df9e4b","block_type":"box","text":"affected options, consistency of interpretation and practice, efficiency of exercise settlement","page_number":116,"box":{"x":116,"y":463,"width":687,"height":13}},{"id":"a57ba883-d519-4012-8d77-4a530a657aa7","block_type":"box","text":"procedures, and the coordination with other clearing agencies of the clearance and settlement of","page_number":116,"box":{"x":117,"y":479,"width":721,"height":12}},{"id":"8006e9fb-79a3-413f-a29d-70a705a3a1f3","block_type":"box","text":"transactions in the underlying interest.","page_number":116,"box":{"x":116,"y":495,"width":288,"height":12}},{"id":"8ef2422f-e09e-434c-9db1-8c44afd077af","block_type":"box","text":"Certain Considerations Regarding Options","page_number":116,"box":{"x":151,"y":519,"width":314,"height":12}},{"id":"fbbe424e-a9f2-4aad-bffa-78a25f0bd6c6","block_type":"box","text":". The FLEX Options in which each Fund may invest will","page_number":116,"box":{"x":467,"y":519,"width":414,"height":12}},{"id":"f5b7eef7-4929-42c6-8cfb-5d3b55ddce12","block_type":"box","text":"be options on an exchange-traded fund (“ETF”) or the S&P 500 Index (together with such ETF, a","page_number":116,"box":{"x":150,"y":534,"width":723,"height":12}},{"id":"ca6a095f-da46-47cd-ae21-f2bfe4d728c3","block_type":"box","text":"“Reference Asset”). As such, the value of a Fund’s FLEX Options will fluctuate with changes in the","page_number":116,"box":{"x":150,"y":550,"width":735,"height":12}},{"id":"220ac417-0d3c-49da-a7a0-a2c30da5a79a","block_type":"box","text":"value of the securities held by the ETF, and thus the ETF’s share price. In addition to the value of","page_number":116,"box":{"x":150,"y":565,"width":726,"height":12}},{"id":"10a6676a-65af-4493-b9ab-a20a8738d43a","block_type":"box","text":"the ETF, the value of an option, in general, will reflect, among other things, the time remaining until","page_number":116,"box":{"x":150,"y":581,"width":738,"height":12}},{"id":"137a432f-7a67-46e8-a995-d72f0c2e0d53","block_type":"box","text":"expiration (the end of the Outcome Period), the relationship of the exercise price to the market","page_number":116,"box":{"x":150,"y":596,"width":704,"height":12}},{"id":"d51e0c3e-39a8-47ed-85b9-fa102d4c39a2","block_type":"box","text":"price of the Reference Asset, and general market conditions. Options that expire unexercised","page_number":116,"box":{"x":150,"y":612,"width":698,"height":12}},{"id":"e1fc7d2b-2770-4dc2-8751-631302afcdc5","block_type":"box","text":"have no value.","page_number":116,"box":{"x":150,"y":628,"width":113,"height":9}},{"id":"bea3b0ef-7f47-42a5-b8a8-a6cf1263f3fa","block_type":"box","text":"The puts and calls on the Reference Asset entitle the purchaser of the option the right to purchase","page_number":116,"box":{"x":150,"y":652,"width":734,"height":12}},{"id":"74c49284-a049-4a0c-a53e-05ac5aca2f89","block_type":"box","text":"(for a call option) or sell (for a put option) the Reference Asset at a predetermined specified price","page_number":116,"box":{"x":150,"y":667,"width":718,"height":12}},{"id":"8b01b2f8-6627-4445-a563-ec3bd72cfd52","block_type":"box","text":"(the “strike price”). When a Fund writes a call on the Reference Asset, it receives a premium and","page_number":116,"box":{"x":150,"y":683,"width":716,"height":12}},{"id":"b154deb2-db30-4188-97c5-9beab409b4a9","block_type":"box","text":"agrees that the purchaser of the call, upon exercise of the call, will receive from the Fund the","page_number":116,"box":{"x":150,"y":698,"width":688,"height":12}},{"id":"5b1176b2-2a11-445d-abeb-46663bafa57d","block_type":"box","text":"delivery of a specified number of shares of the ETF in exchange for the strike price. When a Fund","page_number":116,"box":{"x":150,"y":714,"width":724,"height":12}},{"id":"b3cf5e1a-6a3e-4f9a-b4de-4730ee03607a","block_type":"box","text":"buys a call on the Reference Asset, it pays a premium and has the same rights to such call as","page_number":116,"box":{"x":150,"y":729,"width":697,"height":12}},{"id":"02026178-a771-4cb9-a354-eba8620bbd16","block_type":"box","text":"indicated above. When a Fund buys a put on the Reference Asset, it pays a premium and has the","page_number":116,"box":{"x":150,"y":745,"width":725,"height":12}},{"id":"7c5821cb-1178-4a61-9737-47e8ea0628d7","block_type":"box","text":"right to require the seller of the put, upon the Fund’s exercise of the put, to deliver the specified","page_number":116,"box":{"x":150,"y":760,"width":704,"height":12}},{"id":"46ce5aa5-c221-49f2-b76a-e618d7305f42","block_type":"box","text":"number of shares of the ETF in exchange for the strike price. When a Fund writes a put on the","page_number":116,"box":{"x":150,"y":776,"width":700,"height":12}},{"id":"8648d372-7aa7-4b9d-97e5-f0ecfba4cc2d","block_type":"box","text":"Reference Asset, it receives a premium and the purchaser of the put has the right to require the","page_number":116,"box":{"x":151,"y":791,"width":708,"height":12}},{"id":"e0ec558b-7d4d-4b54-a9bf-00550d7b81c9","block_type":"box","text":"Fund to deliver the specified number of shares of the ETF in exchange for the strike price.","page_number":116,"box":{"x":151,"y":807,"width":665,"height":12}},{"id":"7bab7267-168c-44fd-944b-bede1960a484","block_type":"box","text":"Although each Fund will generally utilize FLEX Options that are physically settled, a Fund may","page_number":116,"box":{"x":149,"y":831,"width":705,"height":12}},{"id":"669cf854-be71-4cc8-acc8-3fa483904b8e","block_type":"box","text":"also utilize FLEX Options that are cash-settled. Cash-settled options give the holder the right to","page_number":116,"box":{"x":150,"y":847,"width":711,"height":12}},{"id":"20fc4407-c5ae-4688-aa7e-d88551b008d8","block_type":"box","text":"receive an amount (or owe an amount) of cash upon the exercise of the option. Gain or loss","page_number":116,"box":{"x":150,"y":862,"width":686,"height":12}},{"id":"a84ed636-cb85-4899-88ee-579424562053","block_type":"box","text":"depends on changes in the value of the ETF’s share price relative to the strike price for a given","page_number":116,"box":{"x":150,"y":878,"width":710,"height":12}},{"id":"d22e8cbb-f2ee-4837-b8dc-21031e9e5066","block_type":"box","text":"II-29","page_number":116,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"3a25302f-0242-4baf-af8c-1b9f5acd42d4","block_type":"box","text":"NM1026U-6004382-116/605","page_number":116,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5db3d6b2-6e42-458e-bde3-bf10ad3d8586","block_type":"box","text":"option contract. The amount of cash is equal to the difference between the closing price of the","page_number":117,"box":{"x":150,"y":87,"width":702,"height":12}},{"id":"cc0d1e76-f2aa-4420-9f3f-063c8b606dfa","block_type":"box","text":"ETF’s share price and the exercise price of the option contract times a specified multiple","page_number":117,"box":{"x":151,"y":102,"width":659,"height":12}},{"id":"c5b1fe31-fc69-4415-8e71-3b6f69f44d40","block_type":"box","text":"(“multiplier”), which determines the total value for each point of such difference.","page_number":117,"box":{"x":150,"y":118,"width":593,"height":12}},{"id":"89dd2f9b-2e48-4a5b-a003-75fc3e84bbc7","block_type":"box","text":"Risks of Options on the Reference Assets","page_number":117,"box":{"x":150,"y":141,"width":306,"height":12}},{"id":"bc1830cf-c1d6-4051-ad97-7c03310fbe32","block_type":"box","text":". If a Fund has purchased an option and exercises it","page_number":117,"box":{"x":458,"y":141,"width":382,"height":12}},{"id":"d0dc6ee2-304a-4cef-83b8-3f2cf68d5062","block_type":"box","text":"before the closing value for that day is available, it runs the risk that the level of the Reference Asset","page_number":117,"box":{"x":150,"y":157,"width":735,"height":12}},{"id":"ac944efc-7a06-43d5-9fe9-8f6dced4eeaf","block_type":"box","text":"may subsequently change. If such a change causes the exercised option to fall out of the money,","page_number":117,"box":{"x":150,"y":172,"width":714,"height":12}},{"id":"039bb871-25a5-4616-992c-ddb469444e2b","block_type":"box","text":"the applicable Fund will be required to pay the difference between the closing Reference Asset","page_number":117,"box":{"x":150,"y":188,"width":698,"height":12}},{"id":"4c83e3c7-793d-43c2-8480-a4d662bde62f","block_type":"box","text":"value and the exercise price of the option (times the applicable multiplier) to the assigned writer.","page_number":117,"box":{"x":150,"y":203,"width":706,"height":12}},{"id":"bf241725-c798-4fee-b5b5-31090989b5e7","block_type":"box","text":"Foreign Exchange Transactions.","page_number":117,"box":{"x":116,"y":242,"width":247,"height":12}},{"id":"e0432ef2-795d-4da4-b98a-198b40af4bf2","block_type":"box","text":"A Fund may enter into spot foreign exchange transactions, forward foreign exchange transactions","page_number":117,"box":{"x":116,"y":273,"width":731,"height":12}},{"id":"09353675-d5ed-47cd-9699-42eedf37ba20","block_type":"box","text":"(“FX forwards”) and currency swaps, purchase and sell currency options, currency futures and related","page_number":117,"box":{"x":117,"y":289,"width":760,"height":12}},{"id":"dabdbc18-68d4-489a-9f96-cc2ab67edab6","block_type":"box","text":"options thereon (collectively, “Currency Instruments”) for purposes of hedging against the decline in the","page_number":117,"box":{"x":116,"y":304,"width":772,"height":12}},{"id":"e78fee03-845d-4bee-a4b5-1a1191080e02","block_type":"box","text":"value of currencies in which its portfolio holdings are denominated against the U.S. dollar or, with","page_number":117,"box":{"x":116,"y":320,"width":725,"height":12}},{"id":"a5b5290d-4960-4980-b6f2-c5752660775e","block_type":"box","text":"respect to certain Funds, to seek to enhance returns.","page_number":117,"box":{"x":117,"y":335,"width":397,"height":12}},{"id":"712e42c3-4443-4dd4-bc91-6c4d49501928","block_type":"box","text":"Such transactions could be effected to hedge with respect to foreign dollar denominated securities","page_number":117,"box":{"x":116,"y":366,"width":734,"height":12}},{"id":"c518759f-e6f6-4699-a129-2c3990393ee6","block_type":"box","text":"owned by a Fund, sold by a Fund but not","page_number":117,"box":{"x":116,"y":382,"width":309,"height":12}},{"id":"16ad3317-a13b-4913-b5c1-2c3fa0d27a99","block_type":"box","text":"yet delivered, or committed or anticipated to be purchased by","page_number":117,"box":{"x":426,"y":382,"width":460,"height":12}},{"id":"b6a3bf5c-adb1-49b9-905b-c19326d4ce8b","block_type":"box","text":"a Fund. As an illustration, a Fund may use such techniques to hedge the stated value in U.S. dollars of","page_number":117,"box":{"x":116,"y":397,"width":768,"height":12}},{"id":"d35d45bf-932e-4e64-86d9-951c9c4fee81","block_type":"box","text":"an investment in a yen-denominated security. For example, the Fund may purchase a foreign currency","page_number":117,"box":{"x":116,"y":413,"width":767,"height":12}},{"id":"520d4780-1e74-4d63-a3e9-9e7de4bd5c36","block_type":"box","text":"put option enabling it to sell a specified amount of yen","page_number":117,"box":{"x":117,"y":428,"width":404,"height":12}},{"id":"7cd01e30-b70a-4177-a42b-a1dd9f1f5bc8","block_type":"box","text":"for dollars at a specified price by a future date.","page_number":117,"box":{"x":521,"y":428,"width":350,"height":12}},{"id":"9e1a67d4-4b3c-4f62-9947-23e6f9c57296","block_type":"box","text":"To the extent the hedge is successful, a loss in the value of the yen relative to the dollar will tend to be","page_number":117,"box":{"x":116,"y":444,"width":764,"height":12}},{"id":"c0fe13d9-05ca-4678-87f0-7b57117df21a","block_type":"box","text":"offset by an increase in the value of the put option. To offset, in whole or in part, the cost of acquiring","page_number":117,"box":{"x":116,"y":459,"width":753,"height":12}},{"id":"4fe82e4b-66c4-4ed5-a95f-50c7d0f9c8a3","block_type":"box","text":"such a put option, the Fund may also sell a call option which, if exercised, requires it to sell a specified","page_number":117,"box":{"x":116,"y":475,"width":764,"height":12}},{"id":"6718e0f7-a359-4f08-9367-ceaf3622e4ef","block_type":"box","text":"amount of yen for dollars at a specified price by a future date (a technique called a “straddle”). By","page_number":117,"box":{"x":116,"y":490,"width":727,"height":12}},{"id":"8d305c40-ed53-424f-a566-5c962aa74b7d","block_type":"box","text":"selling such a call option in this illustration, the Fund gives up the opportunity to profit without limit from","page_number":117,"box":{"x":116,"y":506,"width":767,"height":12}},{"id":"bc7ff5ca-84be-4972-abab-aa06498222c2","block_type":"box","text":"increases in the relative value of the yen to the dollar. “Straddles” of the type that may be used by a","page_number":117,"box":{"x":117,"y":521,"width":742,"height":12}},{"id":"6234451f-ae5f-4e4b-bdd6-06b76e6928a5","block_type":"box","text":"Fund are considered hedging transactions. Certain Funds have a fundamental investment restriction","page_number":117,"box":{"x":117,"y":537,"width":749,"height":12}},{"id":"ef065631-8388-4230-a47e-0672b041edb5","block_type":"box","text":"that restricts currency option strategies.","page_number":117,"box":{"x":116,"y":552,"width":298,"height":12}},{"id":"873471c6-c563-45c4-b88b-ecbdd04b30d9","block_type":"box","text":"Hedging transactions involving Currency Instruments involve substantial risks, including correlation","page_number":117,"box":{"x":117,"y":583,"width":737,"height":12}},{"id":"b34068ed-0834-4521-a38d-34b774155fe3","block_type":"box","text":"risk. A Fund’s use of Currency Instruments to effect hedging strategies is intended to reduce the","page_number":117,"box":{"x":117,"y":599,"width":718,"height":12}},{"id":"67836cb2-a8d6-400f-a75c-8451bd4cb7c5","block_type":"box","text":"volatility of the NAV of the Fund’s shares; however, the use of such hedging strategies will not prevent","page_number":117,"box":{"x":116,"y":614,"width":763,"height":12}},{"id":"2f983a6d-99b1-4bb5-b10a-c6c0d26f7348","block_type":"box","text":"the NAV of the Fund’s shares from fluctuating. Moreover, although Currency Instruments will be used","page_number":117,"box":{"x":116,"y":630,"width":757,"height":12}},{"id":"ba5c4464-b2f9-49cc-89b8-5aebd088c405","block_type":"box","text":"with the intention of hedging against adverse currency movements, transactions in Currency","page_number":117,"box":{"x":116,"y":645,"width":689,"height":12}},{"id":"c06c7514-f0cb-4392-b0ab-84bfd8601580","block_type":"box","text":"Instruments involve the risk that anticipated currency movements will not be accurately predicted and","page_number":117,"box":{"x":117,"y":661,"width":749,"height":12}},{"id":"77167adf-42fd-4855-a8cf-ab73e6a94f71","block_type":"box","text":"that the Fund’s hedging strategies will be ineffective. To the extent that a Fund hedges against","page_number":117,"box":{"x":116,"y":676,"width":701,"height":12}},{"id":"1690c5ce-558a-45f2-9e6f-3512e8612a9f","block_type":"box","text":"anticipated currency movements that do not occur, the Fund may realize losses and decrease its total","page_number":117,"box":{"x":116,"y":692,"width":755,"height":12}},{"id":"6045ae43-764f-431e-8945-31f9e66a68d6","block_type":"box","text":"return. Furthermore, a Fund will only engage in hedging activities from time to time and may not be","page_number":117,"box":{"x":117,"y":707,"width":733,"height":12}},{"id":"8569ff1e-ae60-413a-b453-c03d0333e611","block_type":"box","text":"engaging in hedging activities when movements in currency exchange rates actually occur.","page_number":117,"box":{"x":116,"y":723,"width":674,"height":12}},{"id":"5f8e0e58-b4ac-4b90-abb6-4b5b467ff495","block_type":"box","text":"In connection with its trading in forward foreign currency contracts, a Fund will contract with a foreign","page_number":117,"box":{"x":117,"y":754,"width":746,"height":12}},{"id":"e01370d4-c949-431e-8026-5b15d8ffe223","block_type":"box","text":"or domestic bank, or foreign or domestic securities dealer, to make or take future delivery of a specified","page_number":117,"box":{"x":116,"y":769,"width":766,"height":12}},{"id":"634f8c22-62ae-4ca6-bd1d-d83aa5c8fed7","block_type":"box","text":"amount of a particular currency. There are no limitations on daily price moves in such forward","page_number":117,"box":{"x":116,"y":785,"width":693,"height":12}},{"id":"09a90717-49fb-49a6-ba99-b08ea1e05e57","block_type":"box","text":"contracts, and banks and dealers are not required to continue to make markets in such contracts.","page_number":117,"box":{"x":116,"y":800,"width":722,"height":12}},{"id":"ff4eb50f-d4a7-46ea-a2d2-540b2226c608","block_type":"box","text":"There have been periods during which certain banks or dealers have refused to quote prices for such","page_number":117,"box":{"x":116,"y":816,"width":751,"height":12}},{"id":"a5e58f8d-99a5-419d-ac04-265ca97834b3","block_type":"box","text":"forward contracts or have quoted prices with an unusually wide spread between the price at which the","page_number":117,"box":{"x":116,"y":831,"width":761,"height":12}},{"id":"667cc9f5-3f83-46b3-840d-d3ee99489005","block_type":"box","text":"bank or dealer is prepared to buy and that at which it is prepared to sell. Governmental imposition of","page_number":117,"box":{"x":117,"y":847,"width":747,"height":12}},{"id":"e36d9c8f-186b-4393-b843-f05b76ab4734","block_type":"box","text":"currency controls might limit any such forward contract trading. With respect to its trading of forward","page_number":117,"box":{"x":116,"y":862,"width":746,"height":12}},{"id":"b73a44de-a9e8-4a36-82da-577c7965fa98","block_type":"box","text":"contracts, if any, a Fund will be subject to counterparty risk. Any such failure to perform by a","page_number":117,"box":{"x":116,"y":878,"width":689,"height":12}},{"id":"e8c7cd34-74fc-4146-bd52-7523e6d85e9e","block_type":"box","text":"II-30","page_number":117,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"6c6ecff9-5575-4bf0-8728-319a30cf6612","block_type":"box","text":"NM1026U-6004382-117/605","page_number":117,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"57130a52-97d5-47f0-95a7-565d824cd57c","block_type":"box","text":"counterparty would deprive the Fund of any profit potential or force the Fund to cover its commitments","page_number":118,"box":{"x":116,"y":87,"width":762,"height":12}},{"id":"375a81a5-4462-449e-afe3-61fea1a5526a","block_type":"box","text":"for resale, if any, at the then market price and could result in a loss to the Fund.","page_number":118,"box":{"x":116,"y":102,"width":595,"height":13}},{"id":"cf0d7e1e-8274-494f-aa56-284f720b720c","block_type":"box","text":"It may not be possible for a Fund to hedge against currency exchange rate movements, even if","page_number":118,"box":{"x":117,"y":134,"width":709,"height":12}},{"id":"7e8066ba-208e-459a-b87d-6af5173ec501","block_type":"box","text":"correctly anticipated, in the event that (i) the currency exchange rate movement is so generally","page_number":118,"box":{"x":116,"y":149,"width":707,"height":12}},{"id":"a28a4dd2-1edb-4eb0-904e-bf96485c4648","block_type":"box","text":"anticipated that the Fund is not able to enter into a hedging transaction at an effective price, or (ii) the","page_number":118,"box":{"x":116,"y":165,"width":757,"height":12}},{"id":"9dd48e4d-5623-4ba3-a851-84cc1050abeb","block_type":"box","text":"currency exchange rate movement relates to a market with respect to which Currency Instruments are","page_number":118,"box":{"x":116,"y":180,"width":764,"height":12}},{"id":"34f473d3-810a-4482-9628-d23e78da4655","block_type":"box","text":"not available and it is not possible to engage in effective foreign currency hedging. The cost to a Fund","page_number":118,"box":{"x":117,"y":196,"width":759,"height":12}},{"id":"f8fd4a1a-f410-46c7-90e8-54cf02fcde4a","block_type":"box","text":"of engaging in foreign currency transactions varies with such factors as the currencies involved, the","page_number":118,"box":{"x":116,"y":211,"width":743,"height":12}},{"id":"cb8b2e2d-4cc3-4da6-8489-590ef402c6f9","block_type":"box","text":"length of the contract period and the market conditions then prevailing. Since transactions in foreign","page_number":118,"box":{"x":117,"y":227,"width":744,"height":12}},{"id":"3d1134ec-ec63-4d1d-b735-347ddd4c8d89","block_type":"box","text":"currency exchange usually are conducted on a principal basis, no fees or commissions are involved.","page_number":118,"box":{"x":116,"y":242,"width":750,"height":12}},{"id":"ff188a9b-b126-4819-b297-87a0bc15dba5","block_type":"box","text":"A Fund will not hedge a currency in excess of the aggregate market value of the securities that it owns","page_number":118,"box":{"x":116,"y":273,"width":765,"height":12}},{"id":"ff79ce19-1c8f-457a-9faf-978234c925aa","block_type":"box","text":"(including receivables for unsettled securities sales), or has committed to purchase or anticipates","page_number":118,"box":{"x":117,"y":289,"width":724,"height":12}},{"id":"5fc9ae13-52c3-4780-87a8-58a773bf00df","block_type":"box","text":"purchasing, which are denominated in such currency.","page_number":118,"box":{"x":117,"y":304,"width":401,"height":12}},{"id":"8d7ccae0-19c5-408e-9b64-4ea737df9980","block_type":"box","text":"Spot Transactions and FX Forwards.","page_number":118,"box":{"x":117,"y":335,"width":271,"height":12}},{"id":"8abd1af5-7b24-4234-ac3d-7a73359da6e4","block_type":"box","text":"FX forwards are OTC contracts to purchase or sell a specified","page_number":118,"box":{"x":390,"y":335,"width":470,"height":12}},{"id":"8161f787-b1e9-4784-8a00-28574d46b67d","block_type":"box","text":"amount of a specified currency or multinational currency unit at a specified price and specified future","page_number":118,"box":{"x":116,"y":351,"width":750,"height":12}},{"id":"5a56e598-e175-462b-a677-3de94e5c33c7","block_type":"box","text":"date. Spot foreign exchange transactions are similar but are settled in the current, or “spot”, market. A","page_number":118,"box":{"x":116,"y":366,"width":761,"height":12}},{"id":"e4d8060d-e7db-458c-9f00-75f6463f1ebd","block_type":"box","text":"Fund will enter into foreign exchange transactions for purposes of hedging either a specific transaction","page_number":118,"box":{"x":117,"y":382,"width":764,"height":12}},{"id":"aa2f5145-9911-4578-bfaf-e86731e497ed","block_type":"box","text":"or a portfolio position, or, with respect to certain Funds, to seek to enhance returns. FX forwards","page_number":118,"box":{"x":116,"y":397,"width":719,"height":12}},{"id":"5bc28341-5895-4008-8a2f-5b129671a2e9","block_type":"box","text":"involve substantial currency risk, credit risk and liquidity risk. A Fund may enter into a foreign exchange","page_number":118,"box":{"x":117,"y":413,"width":770,"height":12}},{"id":"b318d9c3-0019-49f6-9f45-a8455e4b8f27","block_type":"box","text":"transaction for purposes of hedging a specific transaction by, for example, purchasing a currency","page_number":118,"box":{"x":116,"y":428,"width":725,"height":12}},{"id":"d5e57964-b561-408d-a81f-0fd3bb36d54b","block_type":"box","text":"needed to settle a security transaction or selling a currency in which the Fund has received or","page_number":118,"box":{"x":117,"y":444,"width":699,"height":12}},{"id":"6791b439-e081-4a63-bc39-360b1b0bfcab","block_type":"box","text":"anticipates receiving a dividend or distribution. A Fund may enter into a foreign exchange transaction","page_number":118,"box":{"x":116,"y":459,"width":754,"height":12}},{"id":"60ae0a24-e055-4a13-b4bd-689c6df81510","block_type":"box","text":"for purposes of hedging a portfolio position by selling forward a currency in which a portfolio position of","page_number":118,"box":{"x":116,"y":475,"width":767,"height":12}},{"id":"7351e35c-a480-4591-9814-9195b1bf028b","block_type":"box","text":"the Fund is denominated or by purchasing a currency in which the Fund anticipates acquiring a","page_number":118,"box":{"x":116,"y":490,"width":711,"height":12}},{"id":"b8a185cc-bf8b-49a4-a7ab-a2dbc70815f7","block_type":"box","text":"portfolio position in the near future. A Fund may also hedge a currency by entering into a transaction in","page_number":118,"box":{"x":117,"y":506,"width":767,"height":12}},{"id":"fd65fe93-4186-44e7-bd6d-0637caf96e87","block_type":"box","text":"a Currency Instrument denominated in a currency other than the currency being hedged (a “cross","page_number":118,"box":{"x":116,"y":521,"width":729,"height":12}},{"id":"fe55d498-1b88-4555-8c8a-f29ef32ddd6f","block_type":"box","text":"hedge”). A Fund will only enter into a cross-hedge if the Manager believes that (i) there is a","page_number":118,"box":{"x":117,"y":537,"width":680,"height":12}},{"id":"3f0f5e6c-38b1-4052-bd87-5d57dae1f271","block_type":"box","text":"demonstrably high correlation between the currency in which the cross-hedge is denominated and the","page_number":118,"box":{"x":116,"y":552,"width":761,"height":12}},{"id":"e82223e1-e806-4347-959e-289441df810a","block_type":"box","text":"currency being hedged, and (ii) executing a cross-hedge through the currency in which the cross","page_number":118,"box":{"x":116,"y":568,"width":722,"height":12}},{"id":"83b97a1f-b06b-4bdd-b1d2-04bdac6f42fa","block_type":"box","text":"hedge is denominated will be significantly more cost-effective or provide substantially greater liquidity","page_number":118,"box":{"x":117,"y":583,"width":755,"height":12}},{"id":"e2b6cf5b-661c-425e-beca-cb6e3b53ee59","block_type":"box","text":"than executing a similar hedging transaction by means of the currency being hedged.","page_number":118,"box":{"x":116,"y":599,"width":638,"height":12}},{"id":"de42071c-766e-44df-ba6f-cc598232e69c","block_type":"box","text":"A Fund may also engage in proxy hedging transactions to reduce the effect of currency fluctuations on","page_number":118,"box":{"x":116,"y":630,"width":765,"height":12}},{"id":"7e0af62f-2dc4-4f74-b4fd-81344ef22e87","block_type":"box","text":"the value of existing or anticipated holdings of portfolio securities. Proxy hedging is often used when","page_number":118,"box":{"x":116,"y":645,"width":747,"height":12}},{"id":"b5bc677e-1d00-4c15-b742-66c980554bb9","block_type":"box","text":"the currency to which the Fund is exposed is difficult to hedge, or to hedge against the U.S. dollar.","page_number":118,"box":{"x":116,"y":661,"width":727,"height":12}},{"id":"75994e32-41d9-49fe-8aea-72271309af33","block_type":"box","text":"Proxy hedging entails entering into a forward contract to sell a currency whose changes in value are","page_number":118,"box":{"x":117,"y":676,"width":741,"height":12}},{"id":"a7494427-fb73-44ca-8129-36fc8fafc4c6","block_type":"box","text":"generally considered to be linked to a currency or currencies in which some or all of the Fund’s","page_number":118,"box":{"x":116,"y":692,"width":704,"height":12}},{"id":"70064a2d-7bb2-4294-a8bb-38eccff98df2","block_type":"box","text":"securities are, or are expected to be, denominated, and to buy U.S. dollars. Proxy hedging involves","page_number":118,"box":{"x":116,"y":707,"width":736,"height":12}},{"id":"5fceeeeb-1dec-488c-851e-0110de88fde0","block_type":"box","text":"some of the same risks and considerations as other transactions with similar instruments. Currency","page_number":118,"box":{"x":116,"y":723,"width":737,"height":12}},{"id":"54e76ca9-4ec6-4b49-a83c-7a3b8f5dfa15","block_type":"box","text":"transactions can result in losses to the Fund if the currency being hedged fluctuates in value to a","page_number":118,"box":{"x":116,"y":738,"width":717,"height":12}},{"id":"64f9f25c-acc1-45ed-b8fb-6ac6ff8e93fe","block_type":"box","text":"degree or in a direction that is not anticipated. In addition, there is the risk that the perceived linkage","page_number":118,"box":{"x":116,"y":754,"width":742,"height":12}},{"id":"fad2b21f-97c9-46bc-bd67-79b1488a3821","block_type":"box","text":"between various currencies may not be present, including during the particular time that a Fund is","page_number":118,"box":{"x":117,"y":769,"width":724,"height":12}},{"id":"6e7ccf5b-f6a1-47e0-b8d9-aa50ea796da4","block_type":"box","text":"engaging in proxy hedging.","page_number":118,"box":{"x":116,"y":785,"width":200,"height":12}},{"id":"db1abffe-9b59-4e36-93b5-87a9c67ec0b2","block_type":"box","text":"A Fund may also cross-hedge currencies by entering into forward contracts to sell one or more","page_number":118,"box":{"x":116,"y":816,"width":703,"height":12}},{"id":"9ac6b995-8b92-4c3e-8cdd-bf6ace3c7b31","block_type":"box","text":"currencies that are expected to decline in value relative to other currencies to which the Fund has or in","page_number":118,"box":{"x":116,"y":831,"width":766,"height":12}},{"id":"1cd1de2f-e9e0-427d-8ea5-308bb30468f3","block_type":"box","text":"which the Fund expects to have portfolio exposure. For example, a Fund may hold both Canadian","page_number":118,"box":{"x":116,"y":847,"width":731,"height":12}},{"id":"73f495ec-ac13-4d4f-b1b1-0ede1f55144c","block_type":"box","text":"government bonds and Japanese government bonds, and the Manager or sub-adviser may believe","page_number":118,"box":{"x":116,"y":862,"width":741,"height":12}},{"id":"9a6a3cb3-3af3-4486-8687-0c1c7ceb31c9","block_type":"box","text":"that Canadian dollars will deteriorate against Japanese yen. The Fund would sell Canadian dollars to","page_number":118,"box":{"x":116,"y":878,"width":754,"height":12}},{"id":"0888651e-947c-410d-82d4-5fb515bc0474","block_type":"box","text":"II-31","page_number":118,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"271422e9-d77d-4f31-9f86-635ee33187bc","block_type":"box","text":"NM1026U-6004382-118/605","page_number":118,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ce36afc0-d0e0-44af-bc3e-94526b51a8d0","block_type":"box","text":"reduce its exposure to that currency and buy Japanese yen. This strategy would be a hedge against a","page_number":119,"box":{"x":117,"y":87,"width":761,"height":12}},{"id":"861b48a4-350b-49a1-8f0b-993d75f42f9e","block_type":"box","text":"decline in the value of Canadian dollars, although it would expose the Fund to declines in the value of","page_number":119,"box":{"x":116,"y":102,"width":758,"height":13}},{"id":"45787535-2d1c-4724-8b78-9b14d02634ee","block_type":"box","text":"the Japanese yen relative to the U.S. dollar.","page_number":119,"box":{"x":116,"y":118,"width":331,"height":12}},{"id":"f311e6cc-5dee-40f5-a155-c73c983505f3","block_type":"box","text":"Some of the forward non-U.S. currency contracts entered into by the Funds are classified as","page_number":119,"box":{"x":116,"y":152,"width":690,"height":12}},{"id":"7bd8107b-979d-4401-b8fc-9a5e9a486aee","block_type":"box","text":"non-deliverable forwards (“NDFs”). NDFs are cash-settled, short-term forward contracts that may be","page_number":119,"box":{"x":117,"y":168,"width":748,"height":12}},{"id":"497c976a-7bf5-472a-aefd-eee31aa51de2","block_type":"box","text":"thinly traded or are denominated in non-convertible foreign currency, where the profit or loss at the","page_number":119,"box":{"x":116,"y":183,"width":736,"height":12}},{"id":"ed6fbdf2-358e-478a-a5ec-1d50809bfeaf","block_type":"box","text":"time at the settlement date is calculated by taking the difference between the agreed upon exchange","page_number":119,"box":{"x":116,"y":199,"width":752,"height":12}},{"id":"77ce305d-aa9b-4ada-8548-4e72afe866ed","block_type":"box","text":"rate and the spot rate at the time of settlement, for an agreed upon notional amount of funds. All NDFs","page_number":119,"box":{"x":117,"y":214,"width":765,"height":12}},{"id":"ab8c9675-e449-4715-a334-0196a11bf09a","block_type":"box","text":"have a fixing date and a settlement date. The fixing date is the date at which the difference between","page_number":119,"box":{"x":117,"y":230,"width":746,"height":12}},{"id":"ed581a8f-64a8-4d04-a225-1b4377584171","block_type":"box","text":"the prevailing market exchange rate and the agreed upon exchange rate is calculated. The settlement","page_number":119,"box":{"x":116,"y":245,"width":761,"height":12}},{"id":"f2e4ede0-2e81-4d2b-befb-56f93a785301","block_type":"box","text":"date is the date by which the payment of the difference is due to the party receiving payment. NDFs","page_number":119,"box":{"x":116,"y":261,"width":745,"height":12}},{"id":"96b62e2a-aa7b-4477-972e-272982d391a8","block_type":"box","text":"are commonly quoted for time periods of one month up to two years, and are normally quoted and","page_number":119,"box":{"x":116,"y":276,"width":733,"height":12}},{"id":"3ccde5d3-02d9-4cf1-a8bc-1687ef40e593","block_type":"box","text":"settled in U.S. dollars. They are often used to gain exposure to and/or hedge exposure to foreign","page_number":119,"box":{"x":116,"y":292,"width":723,"height":12}},{"id":"18d904ef-dffa-4560-8471-515cad47db82","block_type":"box","text":"currencies that are not internationally traded.","page_number":119,"box":{"x":116,"y":307,"width":337,"height":12}},{"id":"38dacaa7-63bc-443c-8d08-6709ebe99637","block_type":"box","text":"Currency Futures.","page_number":119,"box":{"x":117,"y":341,"width":132,"height":12}},{"id":"3814ffea-6540-4b3b-9562-1ce6ee162c16","block_type":"box","text":"A Fund may seek to enhance returns or hedge against the decline in the value of a","page_number":119,"box":{"x":250,"y":341,"width":626,"height":12}},{"id":"593de6e7-27a9-4ad5-af0f-a73387db4e56","block_type":"box","text":"currency through use of currency futures or options on currency futures. Currency futures are similar to","page_number":119,"box":{"x":116,"y":357,"width":769,"height":12}},{"id":"78dc3f48-cab0-4a10-9c88-da68e560bcfb","block_type":"box","text":"forward foreign exchange transactions except that futures are standardized, exchange-traded contracts","page_number":119,"box":{"x":116,"y":372,"width":772,"height":12}},{"id":"5d650d3d-4d25-44ee-82fc-3d6986d57962","block_type":"box","text":"while forward foreign exchange transactions are traded in the OTC market. Currency futures involve","page_number":119,"box":{"x":116,"y":388,"width":747,"height":12}},{"id":"22b1d276-a9b0-4ddd-b338-702ed1a5e789","block_type":"box","text":"substantial currency risk as well as the risks discussed above in “—Futures.”","page_number":119,"box":{"x":116,"y":403,"width":573,"height":12}},{"id":"c6877453-09cf-4a82-bbec-c79ade9a333b","block_type":"box","text":"Currency Options.","page_number":119,"box":{"x":117,"y":437,"width":133,"height":12}},{"id":"7929d712-3007-4e07-a01d-3f69165c8f02","block_type":"box","text":"A Fund may seek to enhance returns or hedge against the decline in the value of a","page_number":119,"box":{"x":251,"y":437,"width":626,"height":12}},{"id":"346923ca-9ea5-4ad0-8a4f-f4bf28dea6af","block_type":"box","text":"currency through the use of currency options. Certain Funds have fundamental investment restrictions","page_number":119,"box":{"x":116,"y":453,"width":763,"height":12}},{"id":"ec58ba1e-cd52-447f-a8d7-9edb7f6f3244","block_type":"box","text":"that permit the purchase of currency options, but prohibit the writing of currency options. Currency","page_number":119,"box":{"x":116,"y":468,"width":732,"height":12}},{"id":"dd76819d-dfc9-4298-ae81-d70624cf899b","block_type":"box","text":"options are similar to options on securities. For example, in consideration for an option premium the","page_number":119,"box":{"x":116,"y":484,"width":745,"height":12}},{"id":"641ccf8a-d780-4b30-8322-9ef80a31b7c2","block_type":"box","text":"writer of a currency option is obligated to sell (in the case of a call option) or purchase (in the case of a","page_number":119,"box":{"x":116,"y":499,"width":765,"height":13}},{"id":"4b1d02a9-c177-4ec0-882f-986e2ef068ef","block_type":"box","text":"put option) a specified amount of a specified currency on or before the expiration date for a specified","page_number":119,"box":{"x":117,"y":515,"width":750,"height":12}},{"id":"ebe637de-3624-4696-837a-a3a63054a4bc","block_type":"box","text":"amount of another currency. A Fund may engage in transactions in options on currencies either on","page_number":119,"box":{"x":116,"y":530,"width":737,"height":13}},{"id":"9bf199cd-e31a-4c35-8b14-2f2b279aa7d8","block_type":"box","text":"exchanges or OTC markets. Such transactions in options may include exotic options on currencies,","page_number":119,"box":{"x":116,"y":546,"width":743,"height":12}},{"id":"8021ddc5-c51b-4a96-9e5c-655b17892abd","block_type":"box","text":"which are typically traded in OTC markets and have additional features that result in different payment","page_number":119,"box":{"x":116,"y":561,"width":763,"height":13}},{"id":"0801c3ad-1f06-4595-aa06-fd043b04b570","block_type":"box","text":"structures and/or expirations. Where a Fund is permitted to write currency options, it may write covered","page_number":119,"box":{"x":116,"y":577,"width":771,"height":12}},{"id":"1e40b2bd-c8ed-4e2b-a4d0-5957e2511b55","block_type":"box","text":"call options on up to 100% of the currencies in its portfolio. See “—Options” above. Currency options","page_number":119,"box":{"x":116,"y":592,"width":752,"height":13}},{"id":"a24f0c4d-4390-4d0a-92a3-f12164399fb5","block_type":"box","text":"involve substantial currency risk, and may also involve credit, leverage or illiquidity risk.","page_number":119,"box":{"x":117,"y":608,"width":651,"height":12}},{"id":"91da99de-3662-4ece-b417-de84a885f682","block_type":"box","text":"Currency Swaps.","page_number":119,"box":{"x":117,"y":642,"width":131,"height":12}},{"id":"0c04c936-f399-4420-87f8-73aba9829c2b","block_type":"box","text":"A Fund may enter into currency swaps in order to protect against currency","page_number":119,"box":{"x":248,"y":642,"width":557,"height":12}},{"id":"34d82139-d320-4c19-b3a4-fae40534506d","block_type":"box","text":"fluctuations or to hedge portfolio positions. Currency swaps are transactions in which one currency is","page_number":119,"box":{"x":116,"y":658,"width":754,"height":12}},{"id":"de3bcf63-ddc9-41de-af7a-4e8a0dd6aba8","block_type":"box","text":"simultaneously bought for a second currency on a spot basis and sold for the second currency on a","page_number":119,"box":{"x":116,"y":673,"width":737,"height":12}},{"id":"880c8e9d-4835-410b-a6e6-f20b3cdfd8d1","block_type":"box","text":"forward basis. Currency swaps involve the exchange of the rights of a Fund and another party to make","page_number":119,"box":{"x":116,"y":689,"width":762,"height":12}},{"id":"76c2579b-0afc-42dd-a56a-7a1d00c7c632","block_type":"box","text":"or receive payments in specified currencies, and typically require the delivery of the entire principal","page_number":119,"box":{"x":116,"y":704,"width":732,"height":12}},{"id":"9eb7ff94-d782-4dbe-a41b-9492760d48f3","block_type":"box","text":"value of one designated currency in exchange for the other designated currency. As a result, the entire","page_number":119,"box":{"x":116,"y":720,"width":763,"height":12}},{"id":"5280ef39-bdb9-41ef-9e7b-d53eea7546d9","block_type":"box","text":"principal value of a currency swap is subject to the risk that the other party to the swap will default on","page_number":119,"box":{"x":117,"y":735,"width":747,"height":12}},{"id":"1807db25-8f9f-45fb-976a-50580bc76215","block_type":"box","text":"its contractual delivery obligations.","page_number":119,"box":{"x":117,"y":751,"width":254,"height":12}},{"id":"d49804f0-3ca3-40cf-adbd-000a27cacce0","block_type":"box","text":"Distressed Securities.","page_number":119,"box":{"x":116,"y":785,"width":174,"height":9}},{"id":"f398d68e-16f3-4097-be35-c1a7dfd3a867","block_type":"box","text":"A Fund may invest in securities, including loans purchased in the secondary","page_number":119,"box":{"x":296,"y":785,"width":565,"height":12}},{"id":"98a91120-a751-4a7b-b4cd-fc96f367860e","block_type":"box","text":"market, that are the subject of bankruptcy proceedings or otherwise in default or in risk of being in","page_number":119,"box":{"x":117,"y":800,"width":724,"height":12}},{"id":"d148c2cf-25ad-4354-8c2d-039853247956","block_type":"box","text":"default as to the repayment of principal and/or interest at the time of acquisition by the Fund or that are","page_number":119,"box":{"x":116,"y":816,"width":763,"height":12}},{"id":"3717f22d-2874-469e-ab1b-71931aa04056","block_type":"box","text":"rated in the lower rating categories by one or more nationally recognized statistical rating organizations","page_number":119,"box":{"x":117,"y":831,"width":768,"height":12}},{"id":"8cb2092b-d40b-4533-82bf-0f45cd438c33","block_type":"box","text":"(for example, Ca or lower by Moody’s and CC or lower by S&P or Fitch) or, if unrated, are in the","page_number":119,"box":{"x":117,"y":847,"width":715,"height":12}},{"id":"7f3e5e20-cce0-4340-90ac-908748a8207c","block_type":"box","text":"judgment of the Manager of equivalent quality (“Distressed Securities”). Investment in Distressed","page_number":119,"box":{"x":115,"y":862,"width":725,"height":12}},{"id":"b1084856-44bd-4deb-9b29-1ca2793d2619","block_type":"box","text":"Securities is speculative and involves significant risks.","page_number":119,"box":{"x":116,"y":878,"width":405,"height":12}},{"id":"ddda999d-997c-494b-a2b0-a281fdd11ab7","block_type":"box","text":"II-32","page_number":119,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"f4abf365-f4e5-4f68-b928-57118c30dd11","block_type":"box","text":"NM1026U-6004382-119/605","page_number":119,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9c1fb37d-cefa-4aa8-8e9d-e0823039ba2e","block_type":"box","text":"A Fund will generally make such investments only when the Manager believes it is reasonably likely","page_number":120,"box":{"x":116,"y":87,"width":745,"height":12}},{"id":"e3becd06-760b-4112-a076-97a04f734157","block_type":"box","text":"that the issuer of the Distressed Securities will make an exchange offer or will be the subject of a plan","page_number":120,"box":{"x":116,"y":102,"width":760,"height":13}},{"id":"7f0d1cae-997a-444d-9631-d93644b5db2e","block_type":"box","text":"of reorganization pursuant to which the Fund will receive new securities in return for the Distressed","page_number":120,"box":{"x":116,"y":118,"width":739,"height":12}},{"id":"fd1eee0d-cca0-43b1-aba9-de6e2c6c50d9","block_type":"box","text":"Securities. However, there can be no assurance that such an exchange offer will be made or that such","page_number":120,"box":{"x":116,"y":134,"width":766,"height":12}},{"id":"dd06e941-20f7-434b-b5c6-c17d8ab43876","block_type":"box","text":"a plan of reorganization will be adopted. In addition, a significant period of time may pass between the","page_number":120,"box":{"x":116,"y":149,"width":762,"height":12}},{"id":"bc089f49-5de2-4577-8827-20e9b4ea3813","block_type":"box","text":"time at which a Fund makes its investment in Distressed Securities and the time that any such","page_number":120,"box":{"x":116,"y":165,"width":704,"height":12}},{"id":"27da7ae9-bae6-4fab-b76a-4759e9c193ab","block_type":"box","text":"exchange offer or plan of reorganization is completed. During this period, it is unlikely that a Fund will","page_number":120,"box":{"x":116,"y":180,"width":756,"height":12}},{"id":"03d9efe5-54b5-454d-bc72-5ae0afdc28d1","block_type":"box","text":"receive any interest payments on the Distressed Securities, the Fund will be subject to significant","page_number":120,"box":{"x":117,"y":196,"width":725,"height":12}},{"id":"412dd3e7-d4e4-4e45-8a5f-e85a99f4414b","block_type":"box","text":"uncertainty as to whether or not the exchange offer or plan of reorganization will be completed and the","page_number":120,"box":{"x":117,"y":211,"width":764,"height":12}},{"id":"40fe367d-48bc-42e5-9fe8-1df1be3646df","block_type":"box","text":"Fund may be required to bear certain extraordinary expenses to protect and recover its investment.","page_number":120,"box":{"x":117,"y":227,"width":741,"height":12}},{"id":"3ec225c1-e239-41da-8a1e-bfd6542c7d87","block_type":"box","text":"Therefore, to the extent the Fund seeks capital appreciation through investment in distressed","page_number":120,"box":{"x":116,"y":242,"width":696,"height":12}},{"id":"9292a744-90cb-4cb9-a560-dd429112cea9","block_type":"box","text":"securities, the Fund’s ability to achieve current income for its shareholders may be diminished. The","page_number":120,"box":{"x":116,"y":258,"width":740,"height":12}},{"id":"3f9f13a7-0106-44b4-8f58-e717c3cd43e8","block_type":"box","text":"Fund also will be subject to significant uncertainty as to when and in what manner and for what value","page_number":120,"box":{"x":117,"y":273,"width":753,"height":12}},{"id":"f7ec99d1-ebbe-498f-b22b-88889f126429","block_type":"box","text":"the obligations evidenced by the distressed securities will eventually be satisfied (","page_number":120,"box":{"x":116,"y":289,"width":605,"height":12}},{"id":"a6d9ca8a-b6d6-458e-b0ab-071ebeea54e4","block_type":"box","text":"e.g.","page_number":120,"box":{"x":723,"y":291,"width":25,"height":10}},{"id":"78e506d8-d669-4753-8679-f96d883b4a51","block_type":"box","text":", through a","page_number":120,"box":{"x":751,"y":289,"width":84,"height":12}},{"id":"eda6aa58-6bcd-40a6-abf8-fd7029b72e8c","block_type":"box","text":"liquidation of the obligor’s assets, an exchange offer or plan of reorganization involving the distressed","page_number":120,"box":{"x":117,"y":304,"width":756,"height":12}},{"id":"7ca2cb06-7790-4e4e-86f0-f8c7d75b2643","block_type":"box","text":"securities or a payment of some amount in satisfaction of the obligation). Even if an exchange offer is","page_number":120,"box":{"x":116,"y":320,"width":757,"height":12}},{"id":"4acd1429-5246-453d-9c8c-bd65390dea52","block_type":"box","text":"made or plan of reorganization is adopted with respect to Distressed Securities held by a Fund, there","page_number":120,"box":{"x":117,"y":335,"width":754,"height":12}},{"id":"56605494-1eed-4ce9-b3c6-a7e7e25da47d","block_type":"box","text":"can be no assurance that the securities or other assets received by a Fund in connection with such","page_number":120,"box":{"x":116,"y":351,"width":740,"height":12}},{"id":"7ffb0764-30e6-4a0a-ad08-204f04161ee8","block_type":"box","text":"exchange offer or plan of reorganization will not have a lower value or income potential than may have","page_number":120,"box":{"x":116,"y":366,"width":765,"height":12}},{"id":"d99fdef5-c29e-4c79-9cbc-6558138a6a35","block_type":"box","text":"been anticipated when the investment was made or no value. Moreover, any securities received by a","page_number":120,"box":{"x":117,"y":382,"width":753,"height":12}},{"id":"e0b4b9f5-d5ea-418b-b0b9-433c48b8c1f0","block_type":"box","text":"Fund upon completion of an exchange offer or plan of reorganization may be restricted as to resale.","page_number":120,"box":{"x":117,"y":397,"width":745,"height":12}},{"id":"acbf48c0-a9ae-4778-b2aa-d8bd2fb9664a","block_type":"box","text":"Similarly, if a Fund participates in negotiations with respect to any exchange offer or plan of","page_number":120,"box":{"x":116,"y":413,"width":683,"height":12}},{"id":"8885f7ee-1cf0-4c66-8035-1b0bf2cb88e4","block_type":"box","text":"reorganization with respect to an issuer of Distressed Securities, the Fund may be restricted from","page_number":120,"box":{"x":117,"y":428,"width":726,"height":12}},{"id":"b90eb332-0464-4384-b5b3-3477239901c0","block_type":"box","text":"disposing of such securities. To the extent that a Fund becomes involved in such proceedings, the","page_number":120,"box":{"x":116,"y":444,"width":734,"height":12}},{"id":"ce43bf30-53c5-49dd-8263-c98bcf4ab311","block_type":"box","text":"Fund may have a more active participation in the affairs of the issuer than that assumed generally by","page_number":120,"box":{"x":117,"y":459,"width":752,"height":12}},{"id":"e17ea2c3-dd47-4922-974c-43e7b30046ad","block_type":"box","text":"an investor. The Fund, however, will not make investments for the purpose of exercising day-to-day","page_number":120,"box":{"x":116,"y":475,"width":744,"height":12}},{"id":"e9ce3f68-9e76-4ec1-9dd1-93648fb16034","block_type":"box","text":"management of any issuer’s affairs.","page_number":120,"box":{"x":117,"y":490,"width":269,"height":12}},{"id":"4bfac1db-23c7-4659-9b77-d7175d347eef","block_type":"box","text":"Environmental, Social and Governance (“ESG”) Integration","page_number":120,"box":{"x":116,"y":521,"width":472,"height":12}},{"id":"c8e5ec5d-057f-4598-a460-b29912e25519","block_type":"box","text":". Although a Fund does not seek to","page_number":120,"box":{"x":590,"y":521,"width":264,"height":12}},{"id":"55416a82-4c10-4ff7-afe8-f2c3dbcbf10a","block_type":"box","text":"implement a specific sustainability objective, strategy or process unless disclosed in its Prospectus,","page_number":120,"box":{"x":117,"y":537,"width":741,"height":12}},{"id":"9f315098-5859-4377-9621-011cb8476b50","block_type":"box","text":"Fund management will consider ESG factors as part of the investment process for the Fund. Fund","page_number":120,"box":{"x":117,"y":552,"width":733,"height":12}},{"id":"844d50a6-3bad-4031-87db-ea753ec8de04","block_type":"box","text":"management views ESG integration as the practice of incorporating financially material ESG data or","page_number":120,"box":{"x":117,"y":568,"width":747,"height":12}},{"id":"028b5cd5-9031-4a83-93ef-6b2532815ed2","block_type":"box","text":"information into investment processes with the objective of enhancing risk-adjusted returns. These","page_number":120,"box":{"x":117,"y":583,"width":734,"height":12}},{"id":"43b8d652-33d8-414b-96eb-ebf41ce50b57","block_type":"box","text":"ESG considerations will vary depending on a Fund’s particular investment strategies and may include","page_number":120,"box":{"x":117,"y":599,"width":757,"height":12}},{"id":"da353e30-c2bb-444e-9815-b5ee9238a5a8","block_type":"box","text":"consideration of third-party research as well as consideration of proprietary BlackRock research across","page_number":120,"box":{"x":116,"y":614,"width":770,"height":12}},{"id":"9782a36f-8628-4901-be27-46442bc76f3f","block_type":"box","text":"the ESG risks and opportunities regarding an issuer. The ESG characteristics utilized in a Fund’s","page_number":120,"box":{"x":116,"y":630,"width":725,"height":12}},{"id":"343813f4-d4e1-4fb7-80fe-69b51fe6f554","block_type":"box","text":"investment process are anticipated to evolve over time and one or more characteristics may not be","page_number":120,"box":{"x":117,"y":645,"width":738,"height":12}},{"id":"e5ae563c-f176-4299-8e28-d4d79e4266fc","block_type":"box","text":"relevant with respect to all issuers that are eligible for investment.","page_number":120,"box":{"x":117,"y":661,"width":484,"height":12}},{"id":"c36920fb-add1-4ecc-b351-ab4e4fdd0b41","block_type":"box","text":"Certain of these considerations may affect a Fund’s exposure to certain companies or industries. While","page_number":120,"box":{"x":117,"y":692,"width":764,"height":12}},{"id":"dca119c2-2460-4e2b-a6f8-5c7ab98bf024","block_type":"box","text":"Fund management views ESG considerations as having the potential to contribute to a Fund’s long","page_number":120,"box":{"x":117,"y":707,"width":740,"height":12}},{"id":"949aa5fc-51df-4f54-83e9-e0691d44a2b7","block_type":"box","text":"term performance, there is no guarantee that such results will be achieved.","page_number":120,"box":{"x":116,"y":723,"width":555,"height":12}},{"id":"849fe8f2-17a9-4f85-afb8-798aadbb7eb9","block_type":"box","text":"Equity Securities.","page_number":120,"box":{"x":116,"y":754,"width":140,"height":12}},{"id":"46deab1c-bb5a-4641-9a25-4b1ee93c798c","block_type":"box","text":"Certain Funds may invest in equity securities, which include common stock and, for","page_number":120,"box":{"x":263,"y":754,"width":618,"height":12}},{"id":"72c6d6e1-3ebe-45b3-bf4b-fa82eda67876","block_type":"box","text":"certain Funds, preferred stock (including convertible preferred stock); bonds, stock purchase warrants","page_number":120,"box":{"x":116,"y":769,"width":755,"height":12}},{"id":"47edc725-3a21-486f-85ec-5e6cb47f35a5","block_type":"box","text":"and rights; equity interests in trusts; general and limited partnerships and limited liability companies;","page_number":120,"box":{"x":116,"y":785,"width":739,"height":12}},{"id":"f6cff51f-9940-4565-8e18-22817b9b1eb0","block_type":"box","text":"and depositary receipts. Stock markets are volatile. The price of equity securities will fluctuate and can","page_number":120,"box":{"x":116,"y":800,"width":759,"height":12}},{"id":"270f4501-8526-4142-bb68-556b40aa9421","block_type":"box","text":"decline and reduce the value of a portfolio investing in equities. The price of equity securities fluctuates","page_number":120,"box":{"x":116,"y":816,"width":763,"height":12}},{"id":"2c97f0e1-f7c7-470e-930d-d54afa5414b9","block_type":"box","text":"based on changes in a company’s financial condition and overall market and economic conditions. The","page_number":120,"box":{"x":117,"y":831,"width":767,"height":12}},{"id":"532e39b4-21d8-42fa-be2d-64eabe058888","block_type":"box","text":"value of equity securities purchased by the Fund could decline if the financial condition of the","page_number":120,"box":{"x":116,"y":847,"width":695,"height":12}},{"id":"89922b4c-9829-43b4-a34d-908ecfa2eec9","block_type":"box","text":"companies the Fund invests in decline or if overall market and economic conditions deteriorate. They","page_number":120,"box":{"x":116,"y":862,"width":755,"height":12}},{"id":"a3acbaa3-8f68-4161-951f-4c0ebed38fa8","block_type":"box","text":"may also decline due to factors that affect a particular industry or industries, such as labor shortages or","page_number":120,"box":{"x":117,"y":878,"width":770,"height":12}},{"id":"7f560401-c12c-4adf-aaca-ac33db8d0718","block_type":"box","text":"II-33","page_number":120,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"a0e79d47-1a56-4688-924d-5854d2d5f211","block_type":"box","text":"NM1026U-6004382-120/605","page_number":120,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"8000b047-92f6-4353-bd8d-8784c84c5342","block_type":"box","text":"increase in production costs and competitive conditions within an industry. In addition, they may","page_number":121,"box":{"x":117,"y":87,"width":714,"height":12}},{"id":"675867f1-5307-458f-b6fd-f860fe7bcc2f","block_type":"box","text":"decline due to general market conditions that are not specifically related to a company or industry,","page_number":121,"box":{"x":116,"y":102,"width":732,"height":13}},{"id":"2b1d30b7-f9fd-4203-b717-71590162dfd5","block_type":"box","text":"such as real or perceived adverse economic conditions, changes in the general outlook for corporate","page_number":121,"box":{"x":116,"y":118,"width":753,"height":12}},{"id":"a54086ab-8f9f-452a-8c91-22cdff7c914d","block_type":"box","text":"earnings, changes in interest or currency rates or generally adverse investor sentiment.","page_number":121,"box":{"x":116,"y":134,"width":654,"height":12}},{"id":"7da2a233-2d31-49b5-a26c-8d4f39abeaa4","block_type":"box","text":"From time to time certain of the Funds may invest in shares of companies through initial public","page_number":121,"box":{"x":117,"y":165,"width":704,"height":12}},{"id":"413e2fd1-12a2-4557-9a45-8b8b107d3d53","block_type":"box","text":"offerings (“IPOs”). IPOs have the potential to produce, and have in fact produced, substantial gains for","page_number":121,"box":{"x":116,"y":180,"width":764,"height":12}},{"id":"5b5e53d3-6211-4ec2-97ff-b8d0667de55e","block_type":"box","text":"certain Funds. There is no assurance that any Fund will have continued access to profitable IPOs and","page_number":121,"box":{"x":116,"y":196,"width":761,"height":12}},{"id":"d65c1ee6-06bb-41fb-a717-037f8631bbe6","block_type":"box","text":"therefore investors should not rely on these past gains as an indication of future performance. The","page_number":121,"box":{"x":116,"y":211,"width":734,"height":12}},{"id":"c9daafee-b4b2-42a0-b1d6-9f1b3edbfd60","block_type":"box","text":"investment performance of a Fund during periods when it is unable to invest significantly or at all in","page_number":121,"box":{"x":117,"y":227,"width":738,"height":12}},{"id":"19846d45-52fb-4b4f-955d-9c2b2b7b9c73","block_type":"box","text":"IPOs may be lower than during periods when it is able to do so. In addition, as a Fund increases in","page_number":121,"box":{"x":117,"y":242,"width":736,"height":12}},{"id":"64df92ab-166f-46ca-86b5-e18ecaaedce4","block_type":"box","text":"size, the impact of IPOs on its performance will generally decrease. Securities issued in IPOs are","page_number":121,"box":{"x":116,"y":258,"width":727,"height":12}},{"id":"30443cab-7421-4412-b9e6-a5fe4f9933e9","block_type":"box","text":"subject to many of the same risks as investing in companies with smaller market capitalizations.","page_number":121,"box":{"x":116,"y":273,"width":717,"height":12}},{"id":"c37f5922-f0bc-438a-9051-aa589068285e","block_type":"box","text":"Securities issued in IPOs have no trading history, and information about the companies may be","page_number":121,"box":{"x":116,"y":289,"width":713,"height":12}},{"id":"7e018aeb-841e-4786-a584-a0ab136e0d29","block_type":"box","text":"available for very limited periods. In addition, the prices of securities sold in IPOs may be highly volatile","page_number":121,"box":{"x":116,"y":304,"width":770,"height":12}},{"id":"cc90715e-a265-4e99-898f-f714381a01d5","block_type":"box","text":"or may decline shortly after the initial public offering.","page_number":121,"box":{"x":116,"y":320,"width":392,"height":12}},{"id":"ded0e845-a326-48a0-b518-66a363e2f051","block_type":"box","text":"The Funds may invest in companies that have relatively small market capitalizations. These","page_number":121,"box":{"x":116,"y":351,"width":685,"height":12}},{"id":"dc6a5502-6083-4a34-a3f8-6d22eed1f33b","block_type":"box","text":"organizations will normally have more limited product lines, markets and financial resources and will be","page_number":121,"box":{"x":116,"y":366,"width":769,"height":12}},{"id":"f8ebb92e-e291-4159-b8db-9d2841b93ab3","block_type":"box","text":"dependent upon a more limited management group than larger capitalized companies. In addition, it is","page_number":121,"box":{"x":116,"y":382,"width":764,"height":12}},{"id":"a8264d86-660f-46f1-9e7a-f638ce1ea953","block_type":"box","text":"more difficult to get information on smaller companies, which tend to be less well known, have shorter","page_number":121,"box":{"x":117,"y":397,"width":758,"height":12}},{"id":"2ca182f6-b9e1-4ac1-a8eb-4f7bfcdbf2d2","block_type":"box","text":"operating histories, do not have significant ownership by large investors and are followed by relatively","page_number":121,"box":{"x":116,"y":413,"width":758,"height":12}},{"id":"c4a53e7f-9558-4a8a-ba2a-7de540c17baa","block_type":"box","text":"few securities analysts. The securities of smaller capitalized companies are often traded in the OTC","page_number":121,"box":{"x":116,"y":428,"width":744,"height":12}},{"id":"ef0ceeb8-f835-4e97-8984-2eb011e0a6f5","block_type":"box","text":"markets and may have fewer market makers and wider price spreads. This may result in greater price","page_number":121,"box":{"x":117,"y":444,"width":760,"height":12}},{"id":"3a963e22-4fae-48f0-9961-71a4db929060","block_type":"box","text":"movements and less ability to sell a Fund’s investment than if the Fund held the securities of larger,","page_number":121,"box":{"x":117,"y":459,"width":743,"height":12}},{"id":"9b659105-3660-46d4-9f88-a073d86df55c","block_type":"box","text":"more established companies.","page_number":121,"box":{"x":117,"y":475,"width":222,"height":12}},{"id":"d7c9c5e1-d3d8-41a4-bcf2-e2fee343628a","block_type":"box","text":"For a discussion of the types of equity securities in which your Fund may invest and the risks","page_number":121,"box":{"x":117,"y":506,"width":693,"height":12}},{"id":"6019b591-20f8-47e7-bef7-2ab2776acaa0","block_type":"box","text":"associated with investing in such equity securities, see your Fund’s Prospectus. 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Such","page_number":121,"box":{"x":117,"y":599,"width":719,"height":12}},{"id":"5ef3e9ec-5d36-40c8-a305-55dbbc5b4322","block_type":"box","text":"investments are subject to certain risks associated with the ownership of real estate and with the real","page_number":121,"box":{"x":117,"y":614,"width":753,"height":12}},{"id":"7c84a48a-91dc-4d6b-8250-a9f3d360c0c5","block_type":"box","text":"estate industry in general. 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The securities of smaller or emerging growth companies may be subject to more abrupt or","page_number":122,"box":{"x":116,"y":182,"width":765,"height":12}},{"id":"f5f9e206-fca7-43ba-aba1-1be3422feb76","block_type":"box","text":"erratic market movements than larger, more established companies or the market average in general.","page_number":122,"box":{"x":116,"y":198,"width":761,"height":12}},{"id":"1f2f1bca-b097-4454-a32b-f1237598645b","block_type":"box","text":"These companies may have limited product lines, markets or financial resources, or they may be","page_number":122,"box":{"x":116,"y":213,"width":723,"height":12}},{"id":"c210fc87-e914-4cf2-b67e-960c49d51cdc","block_type":"box","text":"dependent on a limited management group.","page_number":122,"box":{"x":116,"y":229,"width":330,"height":12}},{"id":"2ed7fb0a-63d2-4c30-a0d5-49f87e3fd03b","block_type":"box","text":"Investments in smaller or emerging growth companies may involve greater risks and thus may be","page_number":122,"box":{"x":117,"y":262,"width":727,"height":12}},{"id":"d567897d-9891-47e3-a21d-36f36e1aa597","block_type":"box","text":"considered speculative. 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As a result, the disposition by a Fund of portfolio securities to meet redemptions","page_number":122,"box":{"x":116,"y":341,"width":756,"height":12}},{"id":"81fb3885-0db0-49d6-b930-e47743b61428","block_type":"box","text":"or otherwise may require the Fund to make many small sales over a lengthy period of time, or to sell","page_number":122,"box":{"x":116,"y":356,"width":749,"height":12}},{"id":"a8553416-6631-4b56-a842-90087d13fa97","block_type":"box","text":"these securities at a discount from market prices or during periods when, in Fund management’s","page_number":122,"box":{"x":116,"y":372,"width":722,"height":12}},{"id":"ca7a6e9c-a719-4871-be04-3db051398171","block_type":"box","text":"judgment, such disposition is not desirable.","page_number":122,"box":{"x":115,"y":388,"width":326,"height":11}},{"id":"4cf23e64-8e3c-413e-9bd9-cc6cf9a1b3b5","block_type":"box","text":"The process of selection and continuous supervision by Fund management does not guarantee","page_number":122,"box":{"x":116,"y":420,"width":714,"height":12}},{"id":"573af54c-9c55-4c82-b090-000c9372dfd9","block_type":"box","text":"successful investment results. Careful initial selection is particularly important in this area as many new","page_number":122,"box":{"x":116,"y":436,"width":770,"height":12}},{"id":"20fd3113-b77f-4518-a717-a96b04317bfe","block_type":"box","text":"enterprises have promise but lack certain of the fundamental factors necessary to prosper. Investing in","page_number":122,"box":{"x":116,"y":451,"width":767,"height":12}},{"id":"1e611077-5d54-4c34-b386-4e74ebd0d877","block_type":"box","text":"small cap and emerging growth companies requires specialized research and analysis.","page_number":122,"box":{"x":116,"y":467,"width":651,"height":12}},{"id":"3bc2d774-e49e-46f2-868a-895c0274167e","block_type":"box","text":"Fund management believes that relatively small companies may have the opportunity to develop into","page_number":122,"box":{"x":117,"y":500,"width":753,"height":12}},{"id":"8dae4a75-b5f3-447c-9d41-2fc2d6c1e384","block_type":"box","text":"significant business enterprises. A Fund may invest in securities of small issuers in the relatively early","page_number":122,"box":{"x":116,"y":515,"width":759,"height":12}},{"id":"020a0ee0-9f60-4e5d-bbeb-22bff42deb04","block_type":"box","text":"stages of business development that have a new technology, a unique or proprietary product or","page_number":122,"box":{"x":116,"y":531,"width":714,"height":12}},{"id":"cc523ff3-3a0e-456b-998a-f4bf7cf73153","block_type":"box","text":"service, or a favorable market position.","page_number":122,"box":{"x":116,"y":546,"width":294,"height":12}},{"id":"569fd837-b19a-470c-89ba-7625d795d6ab","block_type":"box","text":"Equity securities of specific small cap issuers may present different opportunities for long-term capital","page_number":122,"box":{"x":117,"y":579,"width":757,"height":12}},{"id":"f34fa00b-bfff-4bb6-8012-15ddb932d477","block_type":"box","text":"appreciation during varying portions of economic or securities market cycles, as well as during varying","page_number":122,"box":{"x":116,"y":595,"width":763,"height":12}},{"id":"5b3f9b4e-4312-4e97-b66f-f23c6ddd9f37","block_type":"box","text":"stages of their business development. The market valuation of small cap issuers tends to fluctuate","page_number":122,"box":{"x":116,"y":610,"width":734,"height":12}},{"id":"ea328e71-4fee-4d32-b16f-6b8821c713ae","block_type":"box","text":"during economic or market cycles.","page_number":122,"box":{"x":116,"y":626,"width":260,"height":12}},{"id":"68a24917-6cb7-4e02-8ef4-07e34a349bb1","block_type":"box","text":"Tracking Stocks.","page_number":122,"box":{"x":118,"y":659,"width":120,"height":12}},{"id":"c42af12a-41f7-4fe3-b349-e3c1ea242ff7","block_type":"box","text":"A tracking stock is a separate class of common stock whose value is linked to a","page_number":122,"box":{"x":240,"y":659,"width":601,"height":12}},{"id":"c786cf86-3e81-4f7d-8def-42d783e8a9f6","block_type":"box","text":"specific business unit or operating division within a larger company and is designed to “track” the","page_number":122,"box":{"x":116,"y":674,"width":718,"height":12}},{"id":"81f22f2a-5ca0-4bb1-a45d-a90ef239f279","block_type":"box","text":"performance of such business unit or division. The tracking stock may pay dividends to shareholders","page_number":122,"box":{"x":117,"y":690,"width":746,"height":12}},{"id":"0d305a9f-5f46-402a-b7ae-98f58f83f8a3","block_type":"box","text":"independent of the parent company. The parent company, rather than the business unit or division,","page_number":122,"box":{"x":117,"y":705,"width":733,"height":12}},{"id":"532dc562-fdd0-4ece-a676-07eb75615b40","block_type":"box","text":"generally is the issuer of tracking stock. However, holders of the tracking stock may not have the same","page_number":122,"box":{"x":116,"y":721,"width":763,"height":12}},{"id":"7a45e96b-d41f-42b2-aebf-853bedbc7985","block_type":"box","text":"rights as holders of the company’s common stock.","page_number":122,"box":{"x":117,"y":736,"width":371,"height":12}},{"id":"cf9dc5e4-05d0-4c79-9c24-7fbbac98d147","block_type":"box","text":"Exchange-Traded Notes (“ETNs”).","page_number":122,"box":{"x":116,"y":769,"width":271,"height":12}},{"id":"a5f8b217-5edc-457c-b943-4b2aada8b46e","block_type":"box","text":"Certain Funds may invest in ETNs. ETNs are generally notes","page_number":122,"box":{"x":394,"y":769,"width":453,"height":12}},{"id":"ec684378-ba38-41a7-b27b-0dc18286433c","block_type":"box","text":"representing debt of the issuer, usually a financial institution. ETNs combine aspects of both bonds and","page_number":122,"box":{"x":117,"y":785,"width":765,"height":12}},{"id":"951dc021-3a5a-4479-9dbc-8c2278e975f6","block_type":"box","text":"ETFs. An ETN’s returns are based on the performance of one or more underlying assets, reference","page_number":122,"box":{"x":117,"y":800,"width":737,"height":12}},{"id":"65a86131-731f-4cd0-9e93-b10ee369abf4","block_type":"box","text":"rates or indexes, minus fees and expenses. Similar to ETFs, ETNs are listed on an exchange and","page_number":122,"box":{"x":117,"y":816,"width":724,"height":12}},{"id":"5ece3185-3314-4e89-a5e2-c16ddbe3d269","block_type":"box","text":"traded in the secondary market. However, unlike an ETF, an ETN can be held until the ETN’s maturity,","page_number":122,"box":{"x":116,"y":831,"width":767,"height":12}},{"id":"fbb7292e-5eba-4f43-afbe-f126a8b153c2","block_type":"box","text":"at which time the issuer will pay a return linked to the performance of the specific asset, index or rate","page_number":122,"box":{"x":116,"y":847,"width":753,"height":12}},{"id":"f0ff2557-9ace-4831-8f66-dbb5eeedc252","block_type":"box","text":"(“reference instrument”) to which the ETN is linked minus certain fees. Unlike regular bonds, ETNs do","page_number":122,"box":{"x":117,"y":862,"width":758,"height":12}},{"id":"605a0167-43c8-416c-9800-10cfdb487b10","block_type":"box","text":"not make periodic interest payments, and principal is not protected.","page_number":122,"box":{"x":117,"y":878,"width":503,"height":12}},{"id":"9af262a0-f8a0-4964-89b5-cbce8cde2b4e","block_type":"box","text":"II-35","page_number":122,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"14f37db2-a6f1-4ed2-8e50-58d4ef9120ca","block_type":"box","text":"NM1026U-6004382-122/605","page_number":122,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"2ec49fea-0dfd-467f-9331-e76bc827e628","block_type":"box","text":"The value of an ETN may be influenced by, among other things, time to maturity, level of supply and","page_number":123,"box":{"x":116,"y":87,"width":749,"height":12}},{"id":"e016de1e-3838-4d2d-a9c8-bacf778fdaaa","block_type":"box","text":"demand for the ETN, volatility and lack of liquidity in underlying markets, changes in the applicable","page_number":123,"box":{"x":116,"y":102,"width":736,"height":13}},{"id":"c932a47a-a8bf-4407-bbc1-029adeffe275","block_type":"box","text":"interest rates, the performance of the reference instrument, changes in the issuer’s credit rating and","page_number":123,"box":{"x":117,"y":118,"width":745,"height":12}},{"id":"7a51ee2f-9294-4e5f-b77d-a36f474e9275","block_type":"box","text":"economic, legal, political or geographic events that affect the reference instrument. ETNs are subject to","page_number":123,"box":{"x":116,"y":134,"width":772,"height":12}},{"id":"5f1d4ac8-066a-468a-b49f-556193eb985b","block_type":"box","text":"credit risk and the value of the ETN may drop due to a downgrade in an issuer’s credit rating, despite","page_number":123,"box":{"x":116,"y":149,"width":755,"height":12}},{"id":"6b9fcaa2-3c17-4e84-9b7d-8a8b3ab4d564","block_type":"box","text":"the underlying reference instrument remaining unchanged. When a Fund invests in ETNs, it will bear","page_number":123,"box":{"x":116,"y":165,"width":752,"height":12}},{"id":"98472c06-51a8-439f-9d15-413cca424c69","block_type":"box","text":"its proportionate share of any fees and expenses borne by the ETN.","page_number":123,"box":{"x":117,"y":180,"width":509,"height":12}},{"id":"b8b0b72b-92d0-491d-83bd-0b46882858e7","block_type":"box","text":"An ETN that is tied to a reference instrument may not replicate the performance of the reference","page_number":123,"box":{"x":116,"y":212,"width":720,"height":12}},{"id":"e1f07c09-e587-4437-a4ed-e64ef88d9b54","block_type":"box","text":"instrument. ETNs also incur certain expenses not incurred by their applicable reference instrument.","page_number":123,"box":{"x":117,"y":227,"width":740,"height":13}},{"id":"77684200-a460-4f6c-8eff-d677d19a36ce","block_type":"box","text":"Some ETNs that use leverage may, at times, be illiquid and","page_number":123,"box":{"x":116,"y":243,"width":446,"height":12}},{"id":"ed82376b-5974-4d5b-9e4e-70dbd1fae607","block_type":"box","text":"may be difficult to purchase or sell at a fair","page_number":123,"box":{"x":563,"y":243,"width":319,"height":12}},{"id":"a01f5770-5c67-43dc-9401-42e4a35949ca","block_type":"box","text":"price. Levered ETNs are subject to the same risk as other instruments that use leverage in any form.","page_number":123,"box":{"x":117,"y":259,"width":751,"height":12}},{"id":"2fca244f-36a5-4d3f-9e8f-6e5b0a587f0d","block_type":"box","text":"While leverage allows for greater potential return, the potential for loss is also greater. Finally,","page_number":123,"box":{"x":116,"y":274,"width":700,"height":12}},{"id":"589cc498-55d2-4c6d-ae8b-446a1990e133","block_type":"box","text":"additional losses may be incurred if the investment loses value because, in addition to the money lost","page_number":123,"box":{"x":116,"y":290,"width":757,"height":12}},{"id":"988445a9-4de6-48d0-8133-19934c5b56d1","block_type":"box","text":"on the investment, the loan still needs to be repaid.","page_number":123,"box":{"x":116,"y":305,"width":384,"height":12}},{"id":"a770cb04-be48-4463-a1b8-e31507537863","block_type":"box","text":"Because the return on the ETN is dependent on the issuer’s ability or willingness to meet its","page_number":123,"box":{"x":117,"y":337,"width":685,"height":12}},{"id":"d8fc8705-ac7e-4473-b3f2-d07f731cab15","block_type":"box","text":"obligations, the value of the ETN may change due to a change in the issuer’s credit rating, despite no","page_number":123,"box":{"x":116,"y":352,"width":757,"height":13}},{"id":"b0959c50-1abd-422e-aa14-782d2929c7de","block_type":"box","text":"change in the underlying reference instrument. The market value of ETN shares may differ from the","page_number":123,"box":{"x":116,"y":368,"width":744,"height":12}},{"id":"4460c1d0-d311-4e45-8e84-d2ace001f294","block_type":"box","text":"value of the reference instrument. This difference in price may be due to the fact that the supply and","page_number":123,"box":{"x":116,"y":384,"width":748,"height":12}},{"id":"04c3c2ea-bd2d-4a34-afec-dbaf59fe889f","block_type":"box","text":"demand in the market for ETN shares at any point in time is not always identical to the supply and","page_number":123,"box":{"x":116,"y":399,"width":732,"height":12}},{"id":"802b7ddd-74cd-4990-a5dd-a7124fc28cd0","block_type":"box","text":"demand in the market for the assets underlying the reference instrument that the ETN seeks to track.","page_number":123,"box":{"x":116,"y":415,"width":755,"height":12}},{"id":"161a98dd-2172-42f2-9183-de0b3ac9d244","block_type":"box","text":"There may be restrictions on the Fund’s right to redeem its investment in an ETN, which are generally","page_number":123,"box":{"x":116,"y":447,"width":761,"height":12}},{"id":"b685594c-4a75-4049-962b-33bd8bd1433c","block_type":"box","text":"meant to be held until maturity. The Fund’s decision to sell its ETN holdings may be limited by the","page_number":123,"box":{"x":117,"y":462,"width":728,"height":12}},{"id":"b7dea627-1fdc-49fa-88b4-a5d3ace8e776","block_type":"box","text":"availability of a secondary market. An investor in an ETN could lose some or all of the amount","page_number":123,"box":{"x":116,"y":477,"width":701,"height":13}},{"id":"7363311f-f83b-4973-a52e-6280f7c7b6c5","block_type":"box","text":"invested.","page_number":123,"box":{"x":117,"y":493,"width":71,"height":10}},{"id":"679124b4-fe38-4156-a137-ac8bd7768da6","block_type":"box","text":"ETNs are also subject to tax risks. The Internal Revenue Service (the “IRS”) may not accept, and a","page_number":123,"box":{"x":117,"y":525,"width":739,"height":12}},{"id":"30f00d0c-a6ac-47cd-8f2e-40a3ecc31345","block_type":"box","text":"court may not uphold, how the Funds characterize and treat ETNs for tax purposes. The timing and","page_number":123,"box":{"x":116,"y":540,"width":742,"height":13}},{"id":"a835f437-9acf-4b5e-803b-528fec12fab4","block_type":"box","text":"character of income and gains derived by a Fund from investments in ETNs may be affected by future","page_number":123,"box":{"x":116,"y":556,"width":762,"height":12}},{"id":"becbbd73-f2cc-4705-9ba7-08eb6ac411ba","block_type":"box","text":"legislation.","page_number":123,"box":{"x":117,"y":572,"width":83,"height":12}},{"id":"7c3cfc09-98bb-4693-8a36-ef5b93bb3d94","block_type":"box","text":"Foreign Investments.","page_number":123,"box":{"x":116,"y":604,"width":174,"height":12}},{"id":"5a9d1596-d18b-4e4d-842a-efaec01a19e3","block_type":"box","text":"Foreign Investment Risks.","page_number":123,"box":{"x":116,"y":627,"width":193,"height":12}},{"id":"27dc96aa-ce6d-408e-b0e7-850df2ac4db4","block_type":"box","text":"Certain Funds may invest in foreign securities, including securities from","page_number":123,"box":{"x":310,"y":627,"width":540,"height":12}},{"id":"b70dfa27-06ae-42ae-a8b4-fd48963a3db3","block_type":"box","text":"issuers located in emerging market countries. These securities may be denominated in U.S. dollars or","page_number":123,"box":{"x":117,"y":643,"width":760,"height":12}},{"id":"673713e4-35a0-451b-a632-61df1cf30cf0","block_type":"box","text":"in a foreign currency. Investing in foreign securities involves risks not typically associated with investing","page_number":123,"box":{"x":117,"y":658,"width":770,"height":12}},{"id":"e51236d2-47d8-46e0-8ee9-10132ec419d5","block_type":"box","text":"in securities of companies organized and operated in the United States that can increase the chances","page_number":123,"box":{"x":117,"y":674,"width":754,"height":12}},{"id":"ebe46d96-65b6-4255-986d-3825bcfb1539","block_type":"box","text":"that a Fund will lose money.","page_number":123,"box":{"x":116,"y":689,"width":207,"height":12}},{"id":"4b2903ef-38f1-4ae8-a3c2-8dea75065676","block_type":"box","text":"Securities issued by certain companies organized outside the United States may not be deemed to be","page_number":123,"box":{"x":116,"y":721,"width":757,"height":12}},{"id":"21cda365-a5d0-48da-8767-d0bed325f33e","block_type":"box","text":"foreign securities (but rather deemed to be U.S. securities) if (i) the company’s principal operations are","page_number":123,"box":{"x":116,"y":737,"width":761,"height":12}},{"id":"55d7b507-d45e-49c6-a359-4c4646f542e7","block_type":"box","text":"conducted from the U.S., (ii) the company’s equity securities trade principally on a U.S. stock","page_number":123,"box":{"x":116,"y":752,"width":689,"height":12}},{"id":"5283d807-3846-4cc5-898d-398267ce481a","block_type":"box","text":"exchange, (iii) the company does a substantial amount of business in the U.S. or (iv) the issuer of","page_number":123,"box":{"x":116,"y":768,"width":725,"height":12}},{"id":"4faf2558-6494-4594-9bbf-52018438d253","block_type":"box","text":"securities is included in the Fund’s primary U.S. benchmark index.","page_number":123,"box":{"x":116,"y":783,"width":490,"height":12}},{"id":"a12bd54d-aed0-491d-8a32-607a9b146cf6","block_type":"box","text":"In addition to equity securities, foreign investments of the Funds may include: (a) debt obligations","page_number":123,"box":{"x":117,"y":815,"width":721,"height":12}},{"id":"e7a19608-d258-4582-93c6-bae91ba05428","block_type":"box","text":"issued or guaranteed by foreign sovereign governments or their agencies, authorities, instrumentalities","page_number":123,"box":{"x":117,"y":831,"width":767,"height":12}},{"id":"bd75283b-87bd-45e9-af07-750906739c1a","block_type":"box","text":"or political subdivisions, including a foreign state, province or municipality; (b) debt obligations of","page_number":123,"box":{"x":116,"y":846,"width":720,"height":12}},{"id":"a698016d-0bea-4ce2-acf8-60776c13f2cc","block_type":"box","text":"supranational organizations; (c) debt obligations of foreign banks and bank holding companies;","page_number":123,"box":{"x":116,"y":862,"width":710,"height":12}},{"id":"4c545593-357e-4da4-bf0f-b77931e6507c","block_type":"box","text":"(d) debt obligations of domestic banks and corporations issued in foreign currencies; (e) debt","page_number":123,"box":{"x":117,"y":877,"width":694,"height":12}},{"id":"40884951-a070-4baf-81f6-024265cd6db9","block_type":"box","text":"II-36","page_number":123,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"377b11ff-0c34-4b01-91f4-7e0e462c818b","block_type":"box","text":"NM1026U-6004382-123/605","page_number":123,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"29335377-e364-4af8-a877-e82cc3f2d19e","block_type":"box","text":"obligations denominated in the Euro; and (f) foreign corporate debt securities and commercial paper.","page_number":124,"box":{"x":116,"y":87,"width":752,"height":12}},{"id":"0bf9e29f-ffd3-4b8d-9bf3-a9d17ab95428","block_type":"box","text":"Such securities may include loan participations and assignments, convertible securities and","page_number":124,"box":{"x":116,"y":102,"width":684,"height":13}},{"id":"9c8ce859-0425-4829-9d36-44c6d7ad544d","block_type":"box","text":"zero-coupon securities.","page_number":124,"box":{"x":116,"y":118,"width":178,"height":12}},{"id":"845b4863-b6b3-47d5-90fc-2362b43c46dd","block_type":"box","text":"Dividends or interest on, or proceeds from the sale of, foreign securities may be subject to foreign","page_number":124,"box":{"x":117,"y":149,"width":729,"height":12}},{"id":"1c7b08e4-8c0f-48c6-bb16-74083c0f05d8","block_type":"box","text":"withholding taxes.","page_number":124,"box":{"x":116,"y":165,"width":138,"height":12}},{"id":"d30e5b56-3368-4215-8a40-44b47d6f1811","block_type":"box","text":"To the extent that the underlying securities or other instruments held by a Fund trade on foreign","page_number":124,"box":{"x":116,"y":196,"width":715,"height":12}},{"id":"33f7c895-14fd-45a6-aec1-6c89bc0c2bfa","block_type":"box","text":"exchanges or in foreign markets that are closed when the securities exchange on which the Fund’s","page_number":124,"box":{"x":116,"y":211,"width":740,"height":12}},{"id":"76963f67-9581-40ee-9272-884b1c2b1b57","block_type":"box","text":"shares trade is open, there are likely to be deviations between the current price of such an underlying","page_number":124,"box":{"x":116,"y":227,"width":758,"height":12}},{"id":"8006f7ab-e284-4637-ad4e-efb52d830e0c","block_type":"box","text":"security and the last quoted price for the underlying security (i.e., the Fund’s quote from the closed","page_number":124,"box":{"x":116,"y":242,"width":736,"height":12}},{"id":"9d0e182e-81fc-4b54-af60-9fe4fb11c952","block_type":"box","text":"foreign market). The impact of a closed foreign market on a Fund is likely to be greater where a large","page_number":124,"box":{"x":116,"y":258,"width":755,"height":12}},{"id":"cd6c0f40-358c-4a36-b9c4-f7b9f4b3ef7a","block_type":"box","text":"portion of the Fund’s underlying securities or other instruments trade on that closed foreign market or","page_number":124,"box":{"x":117,"y":273,"width":754,"height":12}},{"id":"f95b1f44-7fdc-498f-80d6-cd102be44a25","block_type":"box","text":"when the foreign market is closed for unscheduled reasons. These deviations may result in premiums","page_number":124,"box":{"x":116,"y":289,"width":759,"height":12}},{"id":"8a4f5aa5-8a9b-4965-b2e1-36153e2e4764","block_type":"box","text":"or discounts to certain Funds’ NAVs that may be greater than those experienced by other ETFs.","page_number":124,"box":{"x":116,"y":304,"width":718,"height":12}},{"id":"a5a678e1-c519-4d9a-9384-4a501036439e","block_type":"box","text":"Foreign Market Risk.","page_number":124,"box":{"x":116,"y":335,"width":152,"height":12}},{"id":"cceba6a1-6c7e-4c12-8e61-d3c2427a4151","block_type":"box","text":"Funds that may invest in foreign securities offer the potential for more","page_number":124,"box":{"x":269,"y":335,"width":521,"height":12}},{"id":"b7d875e6-b6e4-433e-9108-e851abe0c54f","block_type":"box","text":"diversification than a Fund that invests only in the United States because securities traded on foreign","page_number":124,"box":{"x":116,"y":351,"width":746,"height":12}},{"id":"aab4168d-292b-4a0a-99bd-686e777c792e","block_type":"box","text":"markets have often (though not always) performed differently from securities traded in the United","page_number":124,"box":{"x":117,"y":366,"width":715,"height":12}},{"id":"d689a6d8-1322-451d-b96d-9e93cb95f823","block_type":"box","text":"States. However, such investments often involve risks not present in U.S. investments that can increase","page_number":124,"box":{"x":116,"y":382,"width":769,"height":12}},{"id":"2c29b6bc-f0c2-4497-b58d-1031c5793156","block_type":"box","text":"the chances that a Fund will lose money. In particular, a Fund is subject to the risk that, because there","page_number":124,"box":{"x":116,"y":397,"width":756,"height":12}},{"id":"7452fd93-1b23-4a52-8e6d-b5a24c5a8913","block_type":"box","text":"are generally fewer investors on foreign exchanges and a smaller number of shares traded each day, it","page_number":124,"box":{"x":116,"y":413,"width":762,"height":12}},{"id":"b8d56ba1-6e6a-42b7-a7e8-d6ac2150654c","block_type":"box","text":"may be difficult for the Fund to buy and sell securities on those exchanges. In addition, prices of foreign","page_number":124,"box":{"x":117,"y":428,"width":763,"height":12}},{"id":"0680ce0a-4a63-4fe2-ab76-94e042af2b71","block_type":"box","text":"securities may fluctuate more than prices of securities traded in the United States. Investments in","page_number":124,"box":{"x":116,"y":444,"width":719,"height":12}},{"id":"84fbf97c-f8b2-4f92-a37d-57ab04ac7815","block_type":"box","text":"foreign markets may also be adversely affected by governmental actions such as the imposition of","page_number":124,"box":{"x":116,"y":459,"width":727,"height":12}},{"id":"306914ce-a5f0-4056-aa93-b12fdabd11fe","block_type":"box","text":"punitive taxes or tariffs. In addition, economic conditions, such as volatile currency exchange rates and","page_number":124,"box":{"x":117,"y":475,"width":759,"height":12}},{"id":"2293fd80-349d-40f8-a4bc-42de26e923b6","block_type":"box","text":"interest rates, political events, military action and other conditions may, without prior warning, lead to the","page_number":124,"box":{"x":117,"y":490,"width":770,"height":12}},{"id":"3277534c-1a3b-4d6e-b1e7-220e607f1829","block_type":"box","text":"governments of certain countries, or the U.S. Government with respect to certain countries, prohibiting","page_number":124,"box":{"x":116,"y":506,"width":756,"height":12}},{"id":"2fe59fa3-aacb-499b-a039-668bc74d7695","block_type":"box","text":"or imposing substantial restrictions through capital controls and/or sanctions on foreign investing in the","page_number":124,"box":{"x":116,"y":521,"width":758,"height":12}},{"id":"d687b758-f80b-44de-b95b-fa9f1af53334","block_type":"box","text":"capital markets or certain industries in those countries. Capital controls and/or sanctions may include","page_number":124,"box":{"x":116,"y":537,"width":746,"height":12}},{"id":"81040bca-efb4-427b-90b8-f92818659431","block_type":"box","text":"the prohibition of, or restrictions on, the ability to own or transfer currency, securities, derivatives or","page_number":124,"box":{"x":116,"y":552,"width":730,"height":12}},{"id":"c59b9c4c-acd1-48d2-88ee-1b9fbae5c7fd","block_type":"box","text":"other assets and may also include retaliatory actions of one government against another government,","page_number":124,"box":{"x":116,"y":568,"width":752,"height":12}},{"id":"b2e432ea-e5f7-4bcb-9f24-94b5f4587bab","block_type":"box","text":"such as seizure of assets. Any of these actions could severely impair a Fund’s ability to purchase, sell,","page_number":124,"box":{"x":116,"y":583,"width":758,"height":12}},{"id":"8928f927-12b6-4c25-96b9-a1a806f05f62","block_type":"box","text":"transfer, receive, deliver or otherwise obtain exposure to foreign securities and assets, including the","page_number":124,"box":{"x":116,"y":599,"width":738,"height":12}},{"id":"80fd26b5-3005-472d-85d1-3d08f066a55d","block_type":"box","text":"ability to transfer the Fund’s assets or income back into the United States, and could negatively impact","page_number":124,"box":{"x":116,"y":614,"width":758,"height":12}},{"id":"fb937116-4a7b-4381-bfe4-c6ad95c44cb4","block_type":"box","text":"the value and/or liquidity of such assets or otherwise adversely affect a Fund’s operations, causing the","page_number":124,"box":{"x":116,"y":630,"width":757,"height":12}},{"id":"6cd6e862-3acb-4323-934a-6ef2a06433af","block_type":"box","text":"Fund to decline in value. Other potential foreign market risks include exchange controls, difficulties in","page_number":124,"box":{"x":117,"y":645,"width":745,"height":12}},{"id":"8859bbbd-6009-4a9c-aeeb-6b895c67b09e","block_type":"box","text":"pricing securities, defaults on foreign government securities, difficulties in enforcing favorable legal","page_number":124,"box":{"x":117,"y":661,"width":722,"height":12}},{"id":"b4f56616-3ee2-4355-b2c3-eaff77857fea","block_type":"box","text":"judgments in foreign courts, and political and social conditions, such as diplomatic relations,","page_number":124,"box":{"x":115,"y":676,"width":674,"height":12}},{"id":"89cd064c-7512-4d8f-b21d-679dbc1e6e76","block_type":"box","text":"confiscatory taxation, expropriation, limitation on the removal of funds or assets, or imposition of (or","page_number":124,"box":{"x":116,"y":692,"width":730,"height":12}},{"id":"57b9227c-d271-44e7-8ec1-148ece1be1c1","block_type":"box","text":"change in) exchange control regulations. Legal remedies available to investors in certain foreign","page_number":124,"box":{"x":116,"y":707,"width":705,"height":12}},{"id":"8b123333-6ce2-4412-8013-91226b8ee16e","block_type":"box","text":"countries may be less extensive than those available to investors in the United States or other foreign","page_number":124,"box":{"x":116,"y":723,"width":745,"height":12}},{"id":"2fffe2f0-80fe-4585-a019-d18494fa30ca","block_type":"box","text":"countries. In addition, changes in government administrations or economic or monetary policies in the","page_number":124,"box":{"x":116,"y":738,"width":746,"height":12}},{"id":"168d5411-2f46-43f5-80ac-4d6bf6c0ecbe","block_type":"box","text":"United States or abroad could result in appreciation or depreciation of portfolio securities and could","page_number":124,"box":{"x":117,"y":754,"width":725,"height":12}},{"id":"d6d984ec-4f34-4b56-9dcb-900964a1dcb2","block_type":"box","text":"favorably or adversely affect a Fund’s operations.","page_number":124,"box":{"x":116,"y":769,"width":362,"height":12}},{"id":"8f841901-2b18-4971-9247-e7233e4a99ab","block_type":"box","text":"Foreign Economy Risk.","page_number":124,"box":{"x":116,"y":800,"width":172,"height":12}},{"id":"11862be6-2c44-4d1f-a67c-0ebdea0bf939","block_type":"box","text":"The economies of certain foreign markets often do not compare favorably with","page_number":124,"box":{"x":295,"y":800,"width":579,"height":12}},{"id":"f93f6db7-af9e-4361-af61-b5e47998ff5f","block_type":"box","text":"that of the United States with respect to such issues as growth of gross national product, reinvestment","page_number":124,"box":{"x":116,"y":816,"width":759,"height":12}},{"id":"bd50ecdf-a784-4268-bb81-266a511f7e6e","block_type":"box","text":"of capital, resources, and balance of payments position. Certain such economies may rely heavily on","page_number":124,"box":{"x":116,"y":831,"width":754,"height":12}},{"id":"7df8adc6-a10c-455c-b688-487ab7bd1806","block_type":"box","text":"particular industries or foreign capital and are more vulnerable to diplomatic developments, the","page_number":124,"box":{"x":117,"y":847,"width":707,"height":12}},{"id":"3d62e2d3-df0f-44ca-a47b-659044532adb","block_type":"box","text":"imposition of economic sanctions against a particular country or countries, changes in international","page_number":124,"box":{"x":117,"y":862,"width":737,"height":12}},{"id":"36b3c766-e34e-4f29-8a33-b2f5a05f5d01","block_type":"box","text":"trading patterns, trade barriers, and other protectionist or retaliatory measures.","page_number":124,"box":{"x":116,"y":878,"width":589,"height":12}},{"id":"8a4ea2bf-635c-4d0b-8d3d-5ba3d41fb273","block_type":"box","text":"II-37","page_number":124,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"8be86bb0-ad6a-413a-b875-0db726af29a2","block_type":"box","text":"NM1026U-6004382-124/605","page_number":124,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a580c130-26ef-4422-b6b1-c2aa809bab4f","block_type":"box","text":"Currency Risk and Exchange Risk.","page_number":125,"box":{"x":117,"y":87,"width":257,"height":12}},{"id":"39993360-9d9a-4919-8327-01619217d7a3","block_type":"box","text":"Because foreign securities generally are denominated and pay","page_number":125,"box":{"x":376,"y":87,"width":475,"height":12}},{"id":"50957b29-0329-44d4-82d3-ae4e0d489ba4","block_type":"box","text":"dividends or interest in foreign currencies, the value of a Fund that invests in foreign securities as","page_number":125,"box":{"x":116,"y":102,"width":727,"height":13}},{"id":"17521a21-7009-46f5-b4f2-8cb3265b908b","block_type":"box","text":"measured in U.S. dollars will be affected favorably or unfavorably by changes in exchange rates.","page_number":125,"box":{"x":117,"y":118,"width":721,"height":12}},{"id":"f921a9f8-7cd5-4b46-8d02-2f1e94c496eb","block_type":"box","text":"Generally, when the U.S. dollar rises in value against a foreign currency, a security denominated in","page_number":125,"box":{"x":117,"y":134,"width":739,"height":12}},{"id":"14bd37b2-fd61-4135-b4fb-ac874916a0ef","block_type":"box","text":"that currency loses value because the currency is worth fewer U.S. dollars. Conversely, when the U.S.","page_number":125,"box":{"x":116,"y":149,"width":765,"height":12}},{"id":"5c5d5993-0cee-4c23-9b95-7217af8d6dba","block_type":"box","text":"dollar decreases in value against a foreign currency, a security denominated in that currency gains","page_number":125,"box":{"x":116,"y":165,"width":737,"height":12}},{"id":"9ea68c31-3f0e-432b-89e4-17ca95c0deea","block_type":"box","text":"value because the currency is worth more U.S. dollars. This risk, generally known as “currency risk,”","page_number":125,"box":{"x":116,"y":180,"width":749,"height":12}},{"id":"56e676c8-d845-44f9-831c-9209be98a4e5","block_type":"box","text":"means that a stronger U.S. dollar will reduce returns for U.S. investors while a weak U.S. dollar will","page_number":125,"box":{"x":117,"y":196,"width":738,"height":12}},{"id":"5ff64330-cc18-4a38-b617-efcf8f17ab25","block_type":"box","text":"increase those returns. Currency exchange rates can also be affected unpredictably by intervention by","page_number":125,"box":{"x":117,"y":211,"width":764,"height":12}},{"id":"607c812f-7c8e-4f9d-80a1-6534e9dd3bf3","block_type":"box","text":"U.S. or foreign governments or central banks, or the failure to intervene, or buy currency controls or","page_number":125,"box":{"x":117,"y":227,"width":743,"height":12}},{"id":"5f2354db-ef88-4012-9f61-4445862d8bd7","block_type":"box","text":"political developments in the United States or abroad.","page_number":125,"box":{"x":117,"y":242,"width":402,"height":12}},{"id":"51d2062a-0281-46e8-a4e2-0dbd4e66559a","block_type":"box","text":"Governmental Supervision and Regulation/Accounting Standards.","page_number":125,"box":{"x":117,"y":269,"width":487,"height":12}},{"id":"5f4b5946-e498-47d1-92b1-d4f3a41f692f","block_type":"box","text":"Many foreign governments","page_number":125,"box":{"x":606,"y":269,"width":208,"height":12}},{"id":"8f97c541-633c-4a21-bfe5-3be608900b37","block_type":"box","text":"supervise and regulate stock exchanges, brokers and the sale of securities less than does the United","page_number":125,"box":{"x":116,"y":285,"width":756,"height":12}},{"id":"c969fbdb-9f41-408c-a725-f6c947b14b30","block_type":"box","text":"States. Some countries may not have laws to protect investors comparable to the U.S. securities laws.","page_number":125,"box":{"x":116,"y":300,"width":765,"height":12}},{"id":"1b718656-8121-47ec-a9bd-e3a5dc645980","block_type":"box","text":"For example, some foreign countries may have no laws or rules against insider trading. Insider trading","page_number":125,"box":{"x":117,"y":316,"width":762,"height":12}},{"id":"f908d4eb-593c-4063-b046-94fd3b53dc96","block_type":"box","text":"occurs when a person buys or sells a company’s securities based on nonpublic information about that","page_number":125,"box":{"x":116,"y":331,"width":760,"height":12}},{"id":"82ba89eb-c803-4130-ac4d-0d3dddb7ea64","block_type":"box","text":"company. Accounting standards in other countries are not necessarily the same as in the United","page_number":125,"box":{"x":116,"y":347,"width":719,"height":12}},{"id":"0b3a4a36-ed7d-4521-8f3f-75e534963bb0","block_type":"box","text":"States. If the accounting standards in another country do not require as much detail as U.S. accounting","page_number":125,"box":{"x":116,"y":362,"width":771,"height":12}},{"id":"f28ada2c-3d24-4c55-9e3d-b92c24ad7ed4","block_type":"box","text":"standards, it may be harder for Fund management to completely and accurately determine a","page_number":125,"box":{"x":116,"y":378,"width":691,"height":12}},{"id":"fb0e02fb-51d3-416d-b89c-b11511dcbde5","block_type":"box","text":"company’s financial condition. In addition, the U.S. Government has from time to time in the past","page_number":125,"box":{"x":116,"y":393,"width":722,"height":12}},{"id":"63de20c7-c320-4540-98dc-ccba60b60bbf","block_type":"box","text":"imposed restrictions, through penalties and otherwise, on foreign investments by U.S. investors such","page_number":125,"box":{"x":117,"y":409,"width":752,"height":12}},{"id":"cf272485-64d7-4410-bb2f-e32dbce338e6","block_type":"box","text":"as the Fund. If such restrictions should be reinstituted, it might become necessary for the Fund to","page_number":125,"box":{"x":116,"y":424,"width":727,"height":12}},{"id":"cf067f41-398d-4952-997a-9e08aaaaac64","block_type":"box","text":"invest all or substantially all of its assets in U.S. securities. Also, brokerage commissions and other","page_number":125,"box":{"x":117,"y":440,"width":737,"height":12}},{"id":"aa9249c8-909f-4578-9364-09ed8760f9bc","block_type":"box","text":"costs of buying or selling securities often are higher in foreign countries than they are in the United","page_number":125,"box":{"x":116,"y":455,"width":736,"height":12}},{"id":"bc9e32d2-705c-4127-9030-d1ff1faec63f","block_type":"box","text":"States. This reduces the amount the Fund can earn on its investments.","page_number":125,"box":{"x":116,"y":471,"width":532,"height":9}},{"id":"cc03d67a-629e-4ca0-8a75-3febd93bce18","block_type":"box","text":"Certain Risks of Holding Fund Assets Outside the United States.","page_number":125,"box":{"x":117,"y":498,"width":477,"height":12}},{"id":"502ae1d7-a34c-4d92-88af-8fb67d4bf353","block_type":"box","text":"A Fund generally holds its foreign","page_number":125,"box":{"x":596,"y":498,"width":259,"height":12}},{"id":"7422d4eb-303a-435d-b424-390a55a79faa","block_type":"box","text":"securities and cash in foreign banks and securities depositories. Some foreign banks and securities","page_number":125,"box":{"x":116,"y":513,"width":743,"height":12}},{"id":"91c92642-63da-4916-a220-05f7a4434447","block_type":"box","text":"depositories may be recently organized or new to the foreign custody business. In addition, there may","page_number":125,"box":{"x":116,"y":529,"width":760,"height":12}},{"id":"21f9b011-b7c0-4cf2-8314-7c81163a9892","block_type":"box","text":"be limited or no regulatory oversight over their operations. Also, the laws of certain countries may put","page_number":125,"box":{"x":117,"y":544,"width":754,"height":12}},{"id":"e6007060-e773-4ab8-82c6-f74215c10fc4","block_type":"box","text":"limits on a Fund’s ability to recover its assets if a foreign bank or depository or issuer of a security or","page_number":125,"box":{"x":117,"y":560,"width":747,"height":12}},{"id":"b9df88d0-dabb-448e-9040-e619e2f6f30c","block_type":"box","text":"any of their agents goes bankrupt. In addition, it is often more expensive for a Fund to buy, sell and","page_number":125,"box":{"x":116,"y":575,"width":741,"height":12}},{"id":"d8352de8-9d05-4dbe-b0b7-955e1539cbd8","block_type":"box","text":"hold securities in certain foreign markets than in the United States. The increased expense of investing","page_number":125,"box":{"x":117,"y":591,"width":768,"height":12}},{"id":"75abb29c-c086-4a7e-8fc1-aa98ea9b3cc8","block_type":"box","text":"in foreign markets reduces the amount a Fund can earn on its investments and typically results in a","page_number":125,"box":{"x":117,"y":606,"width":741,"height":12}},{"id":"8593dcbb-17eb-4d85-b819-8a227de67846","block_type":"box","text":"higher operating expense ratio for the Fund as compared to investment companies that invest only in","page_number":125,"box":{"x":117,"y":622,"width":754,"height":12}},{"id":"f45eec33-50dd-466d-9a51-9b35c5da7456","block_type":"box","text":"the United States.","page_number":125,"box":{"x":116,"y":637,"width":138,"height":10}},{"id":"6a7abb72-a038-436b-adcb-3c987e1ecb06","block_type":"box","text":"Publicly Available Information.","page_number":125,"box":{"x":116,"y":665,"width":222,"height":12}},{"id":"3db718cb-993e-4f71-b276-cf0f1a71fb9b","block_type":"box","text":"In general, less information is publicly available with respect to foreign","page_number":125,"box":{"x":346,"y":665,"width":518,"height":12}},{"id":"e3566d32-5087-48b0-bf55-3ea44419f1ec","block_type":"box","text":"issuers than is available with respect to U.S. companies. Most foreign companies are also not subject","page_number":125,"box":{"x":117,"y":680,"width":753,"height":12}},{"id":"66349e45-9847-4f07-bfbe-857881f4f5e1","block_type":"box","text":"to the uniform accounting and financial reporting requirements applicable to issuers in the United","page_number":125,"box":{"x":116,"y":696,"width":717,"height":12}},{"id":"b5017f90-a943-468f-89c8-bb9eab21391e","block_type":"box","text":"States. While the volume of transactions effected on foreign stock exchanges has increased in recent","page_number":125,"box":{"x":116,"y":711,"width":753,"height":12}},{"id":"39f92380-49d2-46e1-b7a2-3b1d68860ae2","block_type":"box","text":"years, it remains appreciably below that of the New York Stock Exchange. Accordingly, a Fund’s","page_number":125,"box":{"x":116,"y":727,"width":716,"height":12}},{"id":"af67a056-8fda-45ef-9fa8-771af9f1f670","block_type":"box","text":"foreign investments may be less liquid than, and their prices may be more volatile than, comparable","page_number":125,"box":{"x":116,"y":742,"width":740,"height":12}},{"id":"22919d87-9202-406e-ab21-6926248fe0fb","block_type":"box","text":"investments in securities in U.S. companies. In addition, there is generally less government supervision","page_number":125,"box":{"x":117,"y":758,"width":765,"height":12}},{"id":"b4e43bbc-9e04-4251-b504-332ed5d55a16","block_type":"box","text":"and regulation of securities exchanges, brokers and issuers in foreign countries than in the United","page_number":125,"box":{"x":116,"y":773,"width":726,"height":12}},{"id":"cef715d2-79d1-4f48-8e49-0b963ce4dbfb","block_type":"box","text":"States.","page_number":125,"box":{"x":116,"y":789,"width":51,"height":9}},{"id":"38db81ac-9110-4f67-a2b4-eda0b545f5a0","block_type":"box","text":"Settlement Risk.","page_number":125,"box":{"x":117,"y":816,"width":120,"height":9}},{"id":"81688323-e358-49f4-9f68-d594bec617aa","block_type":"box","text":"Settlement and clearance procedures in certain foreign markets differ significantly","page_number":125,"box":{"x":244,"y":816,"width":606,"height":12}},{"id":"e9f83d68-a4ba-4582-bbf1-77582f86abba","block_type":"box","text":"from those in the United States. Supervisory authorities may also be unable to apply standards which","page_number":125,"box":{"x":116,"y":831,"width":757,"height":12}},{"id":"bfadac7c-6e52-4bbe-8db6-702825614cbe","block_type":"box","text":"are comparable with those in the United States. Foreign settlement procedures and trade regulations","page_number":125,"box":{"x":116,"y":847,"width":754,"height":12}},{"id":"a2ceafeb-28b5-4cab-a387-fef3407b2744","block_type":"box","text":"also may involve certain risks (such as delays in payment for or delivery of securities) not typically","page_number":125,"box":{"x":116,"y":862,"width":731,"height":12}},{"id":"a0c26d88-40ef-4c87-bd56-050788ff7b2c","block_type":"box","text":"generated by the settlement of U.S. investments.","page_number":125,"box":{"x":116,"y":878,"width":369,"height":12}},{"id":"41c97e61-bd96-4094-bfae-c627c6eb7553","block_type":"box","text":"II-38","page_number":125,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"96e3f146-99b3-4198-891a-649b4ae06288","block_type":"box","text":"NM1026U-6004382-125/605","page_number":125,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"da3d6717-420e-444e-8f6c-a619a3aa4233","block_type":"box","text":"Communications between the United States and emerging market countries may be unreliable,","page_number":126,"box":{"x":117,"y":87,"width":710,"height":12}},{"id":"d4901eaf-a5b1-4e8a-ab75-f10ba0255797","block_type":"box","text":"increasing the risk of delayed settlements or losses of security certificates in markets that still rely on","page_number":126,"box":{"x":117,"y":102,"width":750,"height":13}},{"id":"dfc1d5e3-6594-480a-a0a7-ac64d81054c8","block_type":"box","text":"physical settlement. Settlements in certain foreign countries at times have not kept pace with the","page_number":126,"box":{"x":117,"y":118,"width":720,"height":12}},{"id":"3b446597-694d-48f7-9f1d-b560909d4fe1","block_type":"box","text":"number of securities transactions; these problems may make it difficult for a Fund to carry out","page_number":126,"box":{"x":117,"y":134,"width":698,"height":12}},{"id":"3e770551-8e3a-438b-a751-292ed08bfb61","block_type":"box","text":"transactions. If a Fund cannot settle or is delayed in settling a purchase of securities, it may miss","page_number":126,"box":{"x":116,"y":149,"width":723,"height":12}},{"id":"cb9072f6-8536-42f3-a7a4-71b7b6aebab4","block_type":"box","text":"attractive investment opportunities and certain of its assets may be uninvested with no return earned","page_number":126,"box":{"x":116,"y":165,"width":751,"height":12}},{"id":"7de4d82f-be85-42bb-a5b3-104a05c3e898","block_type":"box","text":"thereon for some period. If a Fund cannot settle or is delayed in settling a sale of securities, it may lose","page_number":126,"box":{"x":116,"y":180,"width":769,"height":12}},{"id":"97156239-2621-4bfe-8d93-6ecfbaa2438d","block_type":"box","text":"money if the value of the security then declines or, if it has contracted to sell the security to another","page_number":126,"box":{"x":117,"y":196,"width":739,"height":12}},{"id":"7dc85699-4689-4235-8773-a7af5f35aab0","block_type":"box","text":"party, the Fund could be liable to that party for any losses incurred.","page_number":126,"box":{"x":117,"y":211,"width":501,"height":12}},{"id":"5700d519-9d13-4b2a-a0e9-885ee36541bc","block_type":"box","text":"Because of uncertainties in the operation of settlement systems in individual markets, competing","page_number":126,"box":{"x":117,"y":242,"width":720,"height":12}},{"id":"68d21d2a-2659-4f51-9492-9f8b641b7a45","block_type":"box","text":"claims may arise in respect of securities held by or to be transferred to a Fund. Compensation","page_number":126,"box":{"x":116,"y":258,"width":703,"height":12}},{"id":"f103e077-9f4d-4722-b875-2a0a68101bef","block_type":"box","text":"schemes may not exist or may otherwise be limited or inadequate to meet the Fund’s claims in case of","page_number":126,"box":{"x":116,"y":273,"width":766,"height":12}},{"id":"afc85774-272e-4dcf-a4e0-ce224967c0a4","block_type":"box","text":"such event.","page_number":126,"box":{"x":116,"y":289,"width":90,"height":9}},{"id":"5de2d0b0-af6d-4844-99ce-88699e8f580f","block_type":"box","text":"Sovereign Debt.","page_number":126,"box":{"x":117,"y":320,"width":118,"height":12}},{"id":"437b802d-d3a0-445c-8cf7-9e3e34bc9797","block_type":"box","text":"Investment in sovereign debt can involve a high degree of risk. The governmental","page_number":126,"box":{"x":236,"y":320,"width":616,"height":12}},{"id":"9934a782-a7de-44b4-8e40-74fc6eb926b5","block_type":"box","text":"entity that controls the repayment of sovereign debt may not be able or willing to repay the principal","page_number":126,"box":{"x":116,"y":335,"width":743,"height":12}},{"id":"425ed929-65d0-4dea-abfc-7ded6e83b5b5","block_type":"box","text":"and/or interest when due in accordance with the terms of such debt. A governmental entity’s","page_number":126,"box":{"x":116,"y":351,"width":689,"height":12}},{"id":"e571d980-cd31-49b5-b0a1-dc103dcc9c1e","block_type":"box","text":"willingness or ability to repay principal and interest due in a timely manner may be affected by, among","page_number":126,"box":{"x":116,"y":366,"width":761,"height":12}},{"id":"3c9d798b-a97b-4856-99c8-87ecbbc562df","block_type":"box","text":"other factors, its cash flow situation, the extent of its foreign reserves, the availability of sufficient","page_number":126,"box":{"x":116,"y":382,"width":721,"height":12}},{"id":"672d3ea8-4735-4281-b557-728780d84144","block_type":"box","text":"foreign exchange on the date a payment is due, the relative size of the debt service burden to the","page_number":126,"box":{"x":116,"y":397,"width":728,"height":12}},{"id":"a1b6e87f-4b75-49f5-9888-e2ebc136ea78","block_type":"box","text":"economy as a whole, the governmental entity’s policy towards the International Monetary Fund and the","page_number":126,"box":{"x":116,"y":413,"width":770,"height":12}},{"id":"4642a26f-bfae-4a4a-a584-fe61f935f247","block_type":"box","text":"political constraints to which a governmental entity may be subject. Governmental entities may also be","page_number":126,"box":{"x":117,"y":428,"width":764,"height":12}},{"id":"1cd8bbe9-bcaa-4875-b249-28e13439eb8e","block_type":"box","text":"dependent on expected disbursements from foreign governments, multilateral agencies and others","page_number":126,"box":{"x":116,"y":444,"width":738,"height":12}},{"id":"4e4f4342-982c-4809-a3ff-0f6ed81adfdf","block_type":"box","text":"abroad to reduce principal and interest arrearages on their debt. The commitment on the part of these","page_number":126,"box":{"x":116,"y":459,"width":761,"height":12}},{"id":"c868b8fd-f20d-4036-9ef1-cffa85df2c32","block_type":"box","text":"governments, agencies and others to make such disbursements may be conditioned on the","page_number":126,"box":{"x":116,"y":475,"width":684,"height":12}},{"id":"7b8635b2-3f41-43bd-9fcc-0d2fc4e84019","block_type":"box","text":"implementation of economic reforms and/or economic performance and the timely service of such","page_number":126,"box":{"x":117,"y":490,"width":730,"height":12}},{"id":"346a8329-b8f2-4dc4-aab5-866f084af75c","block_type":"box","text":"debtor’s obligations. Failure to implement such reforms, achieve such levels of economic performance","page_number":126,"box":{"x":116,"y":506,"width":763,"height":12}},{"id":"00ce30e6-275c-4e22-a1c9-2dd0b2563094","block_type":"box","text":"or repay principal or interest when due may result in the cancellation of such third parties’","page_number":126,"box":{"x":116,"y":521,"width":668,"height":12}},{"id":"b392207b-b0a0-46a1-87b8-a2b5d830da5d","block_type":"box","text":"commitments to lend funds to the governmental entity, which may further impair such debtor’s ability or","page_number":126,"box":{"x":116,"y":537,"width":769,"height":12}},{"id":"249295aa-7aa1-4ea3-ba01-b19d726b14e0","block_type":"box","text":"willingness to timely service its debts. Consequently, governmental entities may default on their","page_number":126,"box":{"x":116,"y":552,"width":713,"height":12}},{"id":"e66b4102-e097-488c-af22-25d31ac04735","block_type":"box","text":"sovereign debt.","page_number":126,"box":{"x":116,"y":568,"width":119,"height":12}},{"id":"5064dd0e-3530-4c15-a619-a27866dca564","block_type":"box","text":"Holders of sovereign debt may be requested to participate in the rescheduling of such debt and to","page_number":126,"box":{"x":117,"y":599,"width":730,"height":12}},{"id":"dec1fa19-71c0-4c24-97f4-120d447a60be","block_type":"box","text":"extend further loans to governmental entities. In the event of a default by a governmental entity, there","page_number":126,"box":{"x":116,"y":614,"width":758,"height":12}},{"id":"88367b4f-adab-4e4b-b3ce-72b7c86c89ca","block_type":"box","text":"may be few or no effective legal remedies for collecting on such debt.","page_number":126,"box":{"x":117,"y":630,"width":519,"height":12}},{"id":"54aa4318-ac0c-4961-9ea8-d30578676185","block_type":"box","text":"Withholding Tax Reclaims Risk","page_number":126,"box":{"x":118,"y":661,"width":230,"height":12}},{"id":"aa47e456-c2af-45bb-9be0-29a3680d26f2","block_type":"box","text":". A Fund may file claims to recover foreign withholding taxes on","page_number":126,"box":{"x":349,"y":661,"width":469,"height":12}},{"id":"ca900845-10a2-4c32-872c-aef311047d9b","block_type":"box","text":"dividend and interest income (if any) received from issuers in certain countries and capital gains on the","page_number":126,"box":{"x":116,"y":676,"width":763,"height":12}},{"id":"6210b315-20a2-4fc4-a066-847c13a308b9","block_type":"box","text":"disposition of stocks or securities where such withholding tax reclaim is possible. Whether or when a","page_number":126,"box":{"x":116,"y":692,"width":745,"height":12}},{"id":"cdfa36d8-9ae1-4751-b1b1-dc0784cec741","block_type":"box","text":"Fund will receive a withholding tax refund is within the control of the tax authorities in such countries.","page_number":126,"box":{"x":117,"y":707,"width":745,"height":12}},{"id":"93c73029-2a93-4534-a3c1-b933cb68dcf3","block_type":"box","text":"Where a Fund expects to recover withholding taxes, the net asset value of the Fund generally includes","page_number":126,"box":{"x":116,"y":723,"width":762,"height":12}},{"id":"a46ecf24-e891-47b9-b34d-16426b0d2aa9","block_type":"box","text":"accruals for such tax refunds. Each Fund regularly evaluates the probability of recovery. If the","page_number":126,"box":{"x":116,"y":738,"width":696,"height":12}},{"id":"5db00cea-44be-428a-a212-820376dc03f3","block_type":"box","text":"likelihood of recovery materially decreases, due to, for example, a change in tax regulation or approach","page_number":126,"box":{"x":117,"y":754,"width":765,"height":12}},{"id":"c9ab1119-4727-48ad-b4e2-51239e8ae0d5","block_type":"box","text":"in the foreign country, accruals in a Fund’s net asset value for such refunds may be written down","page_number":126,"box":{"x":117,"y":769,"width":716,"height":12}},{"id":"cf756421-3053-4eae-a6c1-400acbdb415b","block_type":"box","text":"partially or in full, which will adversely affect the Fund’s net asset value. Shareholders in a Fund at the","page_number":126,"box":{"x":117,"y":785,"width":755,"height":12}},{"id":"5cb38e4f-25ee-42d6-97e3-28e2ed63f602","block_type":"box","text":"time an accrual is written down will bear the impact of the resulting reduction in net asset value","page_number":126,"box":{"x":116,"y":800,"width":703,"height":12}},{"id":"7d0f46dd-8604-4849-b7ab-a04a2d261aa0","block_type":"box","text":"regardless of whether they were shareholders during the accrual period. Conversely, if a Fund receives","page_number":126,"box":{"x":117,"y":816,"width":765,"height":12}},{"id":"ae31a2f9-e276-409a-8372-7b1a1b6f56dd","block_type":"box","text":"a tax refund that has not been previously accrued, shareholders in the Fund at the time of the","page_number":126,"box":{"x":116,"y":831,"width":699,"height":12}},{"id":"5553934f-26de-4d6b-a882-817112f21872","block_type":"box","text":"successful recovery will benefit from the resulting increase in the Fund’s net asset value. Shareholders","page_number":126,"box":{"x":116,"y":847,"width":767,"height":12}},{"id":"9031f98e-0616-4c68-803e-8b297e4d7aed","block_type":"box","text":"who sold their shares prior to such time will not benefit from such increase in the Fund’s net asset","page_number":126,"box":{"x":116,"y":862,"width":730,"height":12}},{"id":"bcf9f971-dbc7-49b0-af31-c22d288739fe","block_type":"box","text":"value.","page_number":126,"box":{"x":116,"y":878,"width":49,"height":9}},{"id":"498b2056-acd2-42f3-9e4a-e1406d7d9ef6","block_type":"box","text":"II-39","page_number":126,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"7b4550ba-2a04-4247-b8b7-f22ae3488400","block_type":"box","text":"NM1026U-6004382-126/605","page_number":126,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f4782fd0-d69e-454d-9ac2-03d25b8e1fe5","block_type":"box","text":"U.S. Economic Trading Partners Risk.","page_number":127,"box":{"x":117,"y":87,"width":287,"height":12}},{"id":"defd4100-3b0c-4746-9643-54ec724c2bf3","block_type":"box","text":"The United States is a significant, and in some cases the most","page_number":127,"box":{"x":404,"y":87,"width":469,"height":12}},{"id":"7a237b1f-c4aa-4ffd-8fce-77fe66c56ed6","block_type":"box","text":"significant, trading partner of, or foreign investor in, certain countries in which a Fund may invest. As a","page_number":127,"box":{"x":116,"y":102,"width":762,"height":13}},{"id":"1d48d9fd-6e65-4b59-9311-ce39390f44a7","block_type":"box","text":"result, economic conditions of such countries may be particularly affected by changes in the U.S.","page_number":127,"box":{"x":117,"y":118,"width":723,"height":12}},{"id":"f4ba8578-81de-42b1-be15-fe88bf16fc84","block_type":"box","text":"economy. A decrease in U.S. imports or exports, new trade and financial regulations or tariffs, changes","page_number":127,"box":{"x":116,"y":134,"width":770,"height":12}},{"id":"3746faea-de38-4576-bc96-deabf5257957","block_type":"box","text":"in the U.S. dollar exchange rate or an economic slowdown in the United States may have a material","page_number":127,"box":{"x":117,"y":149,"width":745,"height":12}},{"id":"c4b9171a-dc1c-4435-8b93-e566f655e39e","block_type":"box","text":"adverse effect on a country’s economic conditions and, as a result, securities to which the Fund has","page_number":127,"box":{"x":116,"y":165,"width":746,"height":12}},{"id":"a50afc65-9df0-4400-b12a-dd5a6f567ca3","block_type":"box","text":"exposure. Circumstances could arise that could prevent the timely payment of interest or principal on","page_number":127,"box":{"x":116,"y":180,"width":754,"height":12}},{"id":"528571b9-c354-4dfa-9f17-a04180fd1ed4","block_type":"box","text":"U.S. Government debt, such as reaching the legislative “debt ceiling.” Such non-payment would result","page_number":127,"box":{"x":117,"y":196,"width":760,"height":12}},{"id":"68d52275-077f-45c5-970c-e4df382e4b57","block_type":"box","text":"in substantial negative consequences for the U.S. economy and the global financial system.","page_number":127,"box":{"x":117,"y":211,"width":685,"height":12}},{"id":"42c68496-aab2-4fea-babd-0acdd7405e81","block_type":"box","text":"There are strained relations between the United States and a number of foreign countries, including","page_number":127,"box":{"x":116,"y":238,"width":745,"height":12}},{"id":"1e85cbc6-1c58-417f-b7e1-dae54e8297b4","block_type":"box","text":"traditional allies, such as certain European countries, and historical adversaries, such as North Korea,","page_number":127,"box":{"x":116,"y":254,"width":761,"height":12}},{"id":"f7660495-9023-43f1-9aca-edeb6234e99d","block_type":"box","text":"Iran, China and Russia. If these relations were to worsen, it could adversely affect U.S. issuers as well","page_number":127,"box":{"x":117,"y":269,"width":763,"height":12}},{"id":"5b889cd6-e728-4c29-bac9-dd03af045072","block_type":"box","text":"as non-U.S. issuers that rely on the United States for trade. The United States has also experienced","page_number":127,"box":{"x":116,"y":285,"width":748,"height":12}},{"id":"412d578c-d6f2-42d7-8fdc-78f73f9ede15","block_type":"box","text":"increased internal unrest and discord. If these trends were to continue, it may have an adverse impact","page_number":127,"box":{"x":117,"y":300,"width":761,"height":12}},{"id":"f58dec16-b513-4423-a0ff-44ee6eac3a2f","block_type":"box","text":"on the U.S. economy and many of the issuers in which a Fund may invest.","page_number":127,"box":{"x":116,"y":316,"width":557,"height":12}},{"id":"d2194147-823e-445d-bd98-16bd1308de2b","block_type":"box","text":"Funding Agreements.","page_number":127,"box":{"x":116,"y":343,"width":171,"height":12}},{"id":"0be1edbb-b7e0-402f-b941-dff01a6e5168","block_type":"box","text":"Certain Funds may invest in Guaranteed Investment Contracts and similar","page_number":127,"box":{"x":289,"y":343,"width":561,"height":12}},{"id":"149d6f0e-c7ee-4775-a6d7-6a154d21f5db","block_type":"box","text":"funding agreements. In connection with these investments, a Fund makes cash contributions to a","page_number":127,"box":{"x":116,"y":358,"width":727,"height":12}},{"id":"ba8e0e54-6ce2-49e4-93e1-02f65facaa5e","block_type":"box","text":"deposit fund of an insurance company’s general account. The insurance company then credits to the","page_number":127,"box":{"x":116,"y":374,"width":753,"height":12}},{"id":"6d214636-db1e-42b5-808f-3a1a32191a1f","block_type":"box","text":"Fund on a monthly basis guaranteed interest, which is based on an index. The funding agreements","page_number":127,"box":{"x":117,"y":389,"width":740,"height":12}},{"id":"464346ae-6dc6-4dfa-9716-ffd679719364","block_type":"box","text":"provide that this guaranteed interest will not be less than a certain minimum rate. The purchase price","page_number":127,"box":{"x":117,"y":405,"width":753,"height":12}},{"id":"6cf8e632-9f16-44c5-8ec4-184f48b481a4","block_type":"box","text":"paid for a funding agreement becomes part of the general assets of the insurance company, and the","page_number":127,"box":{"x":117,"y":420,"width":749,"height":12}},{"id":"bd6b8944-2b58-4a31-9112-734afe0753cc","block_type":"box","text":"contract is paid from the general assets of the insurance company. Generally, funding agreements are","page_number":127,"box":{"x":116,"y":436,"width":764,"height":12}},{"id":"2516bfdd-7f24-44fd-a6be-1cc6ce8f9a8c","block_type":"box","text":"not assignable or transferable without the permission of the issuing insurance companies, and an","page_number":127,"box":{"x":117,"y":451,"width":726,"height":12}},{"id":"949bd2b9-4909-498d-a97a-1fdf2a5d82bc","block_type":"box","text":"active secondary market in some funding agreements does not currently exist.","page_number":127,"box":{"x":116,"y":467,"width":586,"height":12}},{"id":"94245e0b-5e0e-40c7-870a-22180f93ed56","block_type":"box","text":"Guarantees","page_number":127,"box":{"x":117,"y":494,"width":91,"height":10}},{"id":"d2cc2003-2c97-4f8a-800f-d808afd8a169","block_type":"box","text":".","page_number":127,"box":{"x":209,"y":502,"width":3,"height":1}},{"id":"fdd1c080-3c55-4094-886e-00f510c010d5","block_type":"box","text":"A Fund may purchase securities which contain guarantees issued by an entity separate","page_number":127,"box":{"x":213,"y":494,"width":660,"height":12}},{"id":"4fc3e1a5-22f4-4c7d-921d-e6a65394d53b","block_type":"box","text":"from the issuer of the security. Generally, the guarantor of a security (often an affiliate of the issuer) will","page_number":127,"box":{"x":116,"y":509,"width":771,"height":13}},{"id":"c5c07793-c492-449c-ab79-c6f950ec1d6c","block_type":"box","text":"fulfill an issuer’s payment obligations under a security if the issuer is unable to do so.","page_number":127,"box":{"x":116,"y":525,"width":634,"height":12}},{"id":"1a9fd2ec-27f0-46bd-b579-8d04a9519d0c","block_type":"box","text":"Illiquid Investments.","page_number":127,"box":{"x":116,"y":552,"width":166,"height":12}},{"id":"faa1011e-3d26-4272-bf68-6fdcca8e30bb","block_type":"box","text":"Each Fund may not acquire any illiquid investment if, immediately after the","page_number":127,"box":{"x":284,"y":552,"width":557,"height":12}},{"id":"1a5f0127-8013-459f-8afe-150fdce020ba","block_type":"box","text":"acquisition, a Fund would have invested more than 15% of its net assets in illiquid investments. An","page_number":127,"box":{"x":116,"y":568,"width":737,"height":12}},{"id":"23dc5329-888f-450f-900f-feae27b442e4","block_type":"box","text":"illiquid investment is any investment that a Fund reasonably expects cannot be sold or disposed of in","page_number":127,"box":{"x":117,"y":583,"width":753,"height":12}},{"id":"a5ac7f4e-dec8-49a2-a571-34ec94a32f90","block_type":"box","text":"current market conditions in seven calendar days or less without the sale or disposition significantly","page_number":127,"box":{"x":116,"y":599,"width":742,"height":12}},{"id":"3d6d8297-8277-45eb-9777-a998648d5014","block_type":"box","text":"changing the market value of the investment. Liquid investments may become illiquid after purchase by","page_number":127,"box":{"x":116,"y":614,"width":771,"height":12}},{"id":"21cc6497-8584-40fa-be79-a194ea103c79","block_type":"box","text":"a Fund, particularly during periods of market turmoil. There can be no assurance that a security or","page_number":127,"box":{"x":116,"y":630,"width":733,"height":12}},{"id":"0b5cf97d-b64a-4f32-b4b4-a0f7e22d1b03","block_type":"box","text":"instrument that is deemed to be liquid when purchased will continue to be liquid for as long as it is held","page_number":127,"box":{"x":117,"y":645,"width":766,"height":12}},{"id":"f25fb303-16d2-43c7-84c7-d8633595b7bc","block_type":"box","text":"by a Fund, and any security or instrument held by the Fund may be deemed an illiquid investment","page_number":127,"box":{"x":117,"y":661,"width":725,"height":12}},{"id":"e02514a5-50c4-4cea-8616-3af3c4775aa6","block_type":"box","text":"pursuant to the Fund’s liquidity risk management program. A Fund’s illiquid investments may reduce","page_number":127,"box":{"x":117,"y":676,"width":742,"height":12}},{"id":"eaccaf38-d7bb-48b2-8a90-709d92aef02a","block_type":"box","text":"the returns of the Fund because it may be difficult to sell the illiquid investments at an advantageous","page_number":127,"box":{"x":116,"y":692,"width":743,"height":12}},{"id":"7beacf43-3b48-4de4-9679-406a0094ae81","block_type":"box","text":"time or price. In addition, if a Fund is limited in its ability to dispose of illiquid investments during","page_number":127,"box":{"x":116,"y":707,"width":708,"height":12}},{"id":"32bf5c8b-787f-467c-87d1-991a36038f0f","block_type":"box","text":"periods when shareholders are redeeming or selling their shares or the Fund’s net assets otherwise","page_number":127,"box":{"x":117,"y":723,"width":739,"height":12}},{"id":"d64adc32-18c5-4352-907a-6a87bd6d0325","block_type":"box","text":"shrink, the Fund will need to dispose of liquid securities to meet redemption requests and illiquid","page_number":127,"box":{"x":116,"y":738,"width":712,"height":12}},{"id":"1b23ce5b-3a7b-40bf-921a-f6ff32797d7e","block_type":"box","text":"securities will become a larger portion of the Fund’s holdings. If illiquid investments exceed 15% of a","page_number":127,"box":{"x":116,"y":754,"width":745,"height":12}},{"id":"238db925-10e1-4fa0-9e53-0b41f27791fc","block_type":"box","text":"Fund’s net assets, the Liquidity Rule (as defined below) and the Liquidity Program (as defined below)","page_number":127,"box":{"x":117,"y":769,"width":749,"height":12}},{"id":"d8d8f20c-a57a-498c-a3d1-62ce7d5fdb5c","block_type":"box","text":"will require that certain remedial actions be taken.","page_number":127,"box":{"x":116,"y":785,"width":368,"height":12}},{"id":"a07a3143-22f6-4157-9eb6-7715507aafa7","block_type":"box","text":"Illiquid investments may trade at a discount from","page_number":127,"box":{"x":491,"y":785,"width":358,"height":12}},{"id":"163c7604-05a2-45e5-bf30-5dc561a0518c","block_type":"box","text":"comparable liquid investments. Investment of a Fund’s assets in illiquid investments may restrict the","page_number":127,"box":{"x":116,"y":800,"width":742,"height":12}},{"id":"ffae14cf-b49f-424c-bcdd-d1fc6069dcd4","block_type":"box","text":"ability of the Fund to dispose of its investments in a timely fashion and for a fair price as well as its","page_number":127,"box":{"x":116,"y":816,"width":728,"height":12}},{"id":"2c5c1d12-e570-4599-a56b-a7b7c4dc3db9","block_type":"box","text":"ability to take advantage of market opportunities. The risks associated with illiquidity will be particularly","page_number":127,"box":{"x":116,"y":831,"width":765,"height":12}},{"id":"cf59c77c-d15c-45da-ba38-058f96d54321","block_type":"box","text":"acute where a Fund’s operations require cash, such as when the Fund redeems shares or pays","page_number":127,"box":{"x":116,"y":847,"width":715,"height":12}},{"id":"2da11b55-a6f1-4589-9068-d1dc97e889e4","block_type":"box","text":"dividends, and could result in the Fund borrowing to meet short-term cash requirements or incurring","page_number":127,"box":{"x":116,"y":862,"width":746,"height":12}},{"id":"05027ae3-864a-48f0-b608-974480d6c181","block_type":"box","text":"capital losses on the sale of illiquid investments.","page_number":127,"box":{"x":116,"y":878,"width":362,"height":12}},{"id":"008bffbe-cde3-42f7-b993-eb5b194f8b23","block_type":"box","text":"II-40","page_number":127,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"58f432f2-1683-4280-b6aa-6b94a9d59e67","block_type":"box","text":"NM1026U-6004382-127/605","page_number":127,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"756a6b5d-d986-466f-abab-e2582a34906c","block_type":"box","text":"Index Funds","page_number":128,"box":{"x":116,"y":87,"width":99,"height":10}},{"id":"9a5fa4de-390a-466b-af98-77abd4606e02","block_type":"box","text":".","page_number":128,"box":{"x":216,"y":95,"width":2,"height":1}},{"id":"36672f0e-5b5c-493a-8109-0930fa484ec4","block_type":"box","text":"Cash Flows; Expenses.","page_number":128,"box":{"x":117,"y":111,"width":173,"height":12}},{"id":"70f0f59b-5824-4e14-a5c6-8cb2da15df79","block_type":"box","text":"The ability of each Fund to satisfy its investment objective depends to some","page_number":128,"box":{"x":291,"y":111,"width":573,"height":12}},{"id":"39caa751-0a15-48ea-99d4-fcf80d8c3d24","block_type":"box","text":"extent on the Manager’s ability to manage cash flow (primarily from purchases and redemptions and","page_number":128,"box":{"x":116,"y":127,"width":749,"height":12}},{"id":"237b9624-3195-4ffb-8f3b-e0dfdf231e8b","block_type":"box","text":"distributions from the Fund’s investments). The Manager will make investment changes to a Fund’s","page_number":128,"box":{"x":116,"y":142,"width":742,"height":12}},{"id":"50c16a1d-b3f4-4937-81c6-216bdbefdaf3","block_type":"box","text":"portfolio to accommodate cash flow while continuing to seek to replicate the total return of the Fund’s","page_number":128,"box":{"x":117,"y":158,"width":753,"height":12}},{"id":"1fe21700-a1c8-44b7-bfbf-fc30cbb0647a","block_type":"box","text":"target index. Investors should also be aware that the investment performance of each index is a","page_number":128,"box":{"x":116,"y":173,"width":716,"height":12}},{"id":"02db1cef-b166-4d8a-b2be-f220d946c84e","block_type":"box","text":"hypothetical number which does not take into account brokerage commissions and other transaction","page_number":128,"box":{"x":117,"y":189,"width":749,"height":12}},{"id":"dafe783b-f31f-4368-a815-5725d15006c2","block_type":"box","text":"costs, custody and other costs of investing, and any incremental operating costs (","page_number":128,"box":{"x":116,"y":204,"width":606,"height":12}},{"id":"bb079308-b05f-493b-b713-9f95801c3c7b","block_type":"box","text":"e.g.","page_number":128,"box":{"x":723,"y":207,"width":26,"height":9}},{"id":"a83b7d21-a8db-431f-a11a-ba3b311a3db9","block_type":"box","text":", transfer agency","page_number":128,"box":{"x":752,"y":204,"width":129,"height":12}},{"id":"4a8fc866-c9e9-4c2d-b927-1773dc975af7","block_type":"box","text":"and accounting costs) that will be borne by the Funds. Finally, since each Fund seeks to replicate the","page_number":128,"box":{"x":116,"y":220,"width":757,"height":12}},{"id":"f3950456-cc76-4223-a24d-43b745f0df94","block_type":"box","text":"total return of its target index, the Manager generally will not attempt to judge the merits of any","page_number":128,"box":{"x":116,"y":235,"width":706,"height":12}},{"id":"bba9e908-84a3-4628-b26f-81de2c28f760","block_type":"box","text":"particular security as an investment.","page_number":128,"box":{"x":117,"y":251,"width":272,"height":12}},{"id":"3d8e9606-d534-4689-80d2-9e5e75e1710f","block_type":"box","text":"Tracking Error Risk","page_number":128,"box":{"x":118,"y":284,"width":142,"height":12}},{"id":"00f304d1-27c3-4900-aa6e-6790a11eb77a","block_type":"box","text":". A Fund may be subject to tracking error, which is the divergence of the Fund’s","page_number":128,"box":{"x":260,"y":284,"width":586,"height":12}},{"id":"0234712a-7929-4968-a8e1-214a1f48b03e","block_type":"box","text":"performance from that of the Underlying Index. Tracking error may occur because of differences","page_number":128,"box":{"x":117,"y":300,"width":711,"height":12}},{"id":"7fb7fc43-f272-4e2e-a5e6-7b9fedc22cbf","block_type":"box","text":"between the securities and other instruments held in the Fund’s portfolio and those included in the","page_number":128,"box":{"x":117,"y":315,"width":725,"height":12}},{"id":"723cd67c-601b-4066-8624-240c678bc39c","block_type":"box","text":"Underlying Index, pricing differences (including, as applicable, differences between a security’s price at","page_number":128,"box":{"x":117,"y":331,"width":762,"height":12}},{"id":"1bca96df-80e4-4d4a-afbe-bfb8f84bb05f","block_type":"box","text":"the local market close and the Fund’s valuation of a security at the time of calculation of the Fund’s net","page_number":128,"box":{"x":116,"y":346,"width":757,"height":12}},{"id":"6d3d9969-837a-47bd-a474-0c2570b88fd4","block_type":"box","text":"asset value), differences in transaction costs incurred by the Fund, the Fund’s holding of uninvested","page_number":128,"box":{"x":116,"y":362,"width":739,"height":12}},{"id":"d303a035-ee47-43fc-8c12-ff7d593b2b54","block_type":"box","text":"cash, differences in timing of the accrual of or the valuation of dividends or other distributions, interest,","page_number":128,"box":{"x":116,"y":377,"width":756,"height":12}},{"id":"1b1d47a4-c0fb-4acb-8b4f-a113bf5187e2","block_type":"box","text":"the requirements to maintain pass-through tax treatment, portfolio transactions carried out to minimize","page_number":128,"box":{"x":116,"y":393,"width":757,"height":12}},{"id":"d2c646f3-a6ff-4c8b-9167-17324b55e563","block_type":"box","text":"the distribution of capital gains to shareholders, changes to the Underlying Index or the costs to the","page_number":128,"box":{"x":116,"y":408,"width":733,"height":12}},{"id":"b5204d8b-1881-426d-af46-82e66e2b3e18","block_type":"box","text":"Fund of complying with various new or existing regulatory requirements. These risks may be heightened","page_number":128,"box":{"x":117,"y":424,"width":770,"height":12}},{"id":"56027f62-be20-4479-9341-f0fed3d6da05","block_type":"box","text":"during times of increased market volatility or other unusual market conditions. In addition, tracking error","page_number":128,"box":{"x":116,"y":439,"width":765,"height":12}},{"id":"2f761888-2c4e-4ac6-94b0-fd82fa21db01","block_type":"box","text":"may result because the Fund incurs fees and expenses, while the Underlying Index does not.","page_number":128,"box":{"x":117,"y":455,"width":690,"height":12}},{"id":"01531ca6-b659-4503-a957-9c22c821011b","block_type":"box","text":"When an issuer is introduced by an index provider into an index tracked by a Fund, the Manager may","page_number":128,"box":{"x":116,"y":488,"width":758,"height":12}},{"id":"711e1789-f27d-49bd-9f51-73220dfa2ee0","block_type":"box","text":"conduct an analysis on such issuer’s securities to identify and screen for outlier high risk behavior","page_number":128,"box":{"x":116,"y":503,"width":729,"height":12}},{"id":"ca210abf-9a67-4ead-a4f6-7ccb441a4369","block_type":"box","text":"(such as rapid or unusual price growth that does not appear to be supported by publicly available","page_number":128,"box":{"x":117,"y":519,"width":724,"height":12}},{"id":"83ff7751-25cc-49f4-9421-78b92b73edbc","block_type":"box","text":"information on the business and assets of the issuer, unusual or significant short interest or lending","page_number":128,"box":{"x":117,"y":534,"width":740,"height":12}},{"id":"6a70b77b-6df2-4856-ac65-a42cab53bf56","block_type":"box","text":"activity, negative sentiment, suspended trading or incorrect free-float calculations, which could be","page_number":128,"box":{"x":116,"y":550,"width":728,"height":12}},{"id":"5468d1e5-a2d3-4c4b-80b5-75d5b44fb4ea","block_type":"box","text":"indicators of possible irregularities, miscalculations or even fraud). 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FTSE has no obligation to take the needs of any particular Fund or its","page_number":130,"box":{"x":116,"y":428,"width":694,"height":12}},{"id":"68ba61ee-0dd5-483c-8f76-11e749729cf6","block_type":"box","text":"participants or any other product or person into consideration in determining, composing or calculating","page_number":130,"box":{"x":117,"y":444,"width":762,"height":12}},{"id":"b1450ab2-1af2-4037-8f70-e02f63ab5983","block_type":"box","text":"the FTSE Index.","page_number":130,"box":{"x":116,"y":459,"width":126,"height":10}},{"id":"c8d7f873-55ca-4a8b-bc38-e8ad267322c0","block_type":"box","text":"Bloomberg Indexes.","page_number":130,"box":{"x":116,"y":490,"width":148,"height":12}},{"id":"7e2d19ae-022c-42fd-b081-dbbd701124f7","block_type":"box","text":"No Fund is promoted, sponsored or endorsed by, nor in any way affiliated with","page_number":130,"box":{"x":265,"y":490,"width":592,"height":12}},{"id":"a53af5b1-8c86-495a-b9fe-c973c55d1d96","block_type":"box","text":"Bloomberg Finance L.P. and its affiliates (collectively, “Bloomberg”). Bloomberg is not responsible for","page_number":130,"box":{"x":117,"y":506,"width":754,"height":12}},{"id":"29a58227-14a3-44da-a28d-0e1bf27c5a13","block_type":"box","text":"nor has it reviewed any Fund nor any associated literature or publications, and Bloomberg makes no","page_number":130,"box":{"x":117,"y":521,"width":750,"height":12}},{"id":"bbc49364-ce11-4269-81c5-a508f33a4179","block_type":"box","text":"representation or warranty, express or implied, as to their accuracy, or completeness, or otherwise.","page_number":130,"box":{"x":117,"y":537,"width":740,"height":12}},{"id":"d16fe065-3c23-44c0-97a9-d4e94446f843","block_type":"box","text":"Bloomberg reserves the right, at any time and without notice, to alter, amend, terminate or in any way","page_number":130,"box":{"x":117,"y":568,"width":757,"height":12}},{"id":"4133d5b1-6dbf-497b-8706-8423a595d35b","block_type":"box","text":"change a Bloomberg Index. 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BofA is not the issuer or producer of the ICE BofA Indices, and its name is a","page_number":130,"box":{"x":117,"y":676,"width":722,"height":12}},{"id":"17b1f8cf-bbc6-4e41-816e-7e511034e723","block_type":"box","text":"trademark and service mark of its owner used under license. Neither ICE nor BofA is responsible for or","page_number":130,"box":{"x":116,"y":692,"width":764,"height":12}},{"id":"70588ba3-f383-4d6c-a0b5-3963cd90daa4","block_type":"box","text":"has reviewed any Fund nor any associated literature or publications and ICE and BofA make no","page_number":130,"box":{"x":117,"y":707,"width":710,"height":12}},{"id":"7b5fd3b2-abed-464c-b478-149b8b9d227b","block_type":"box","text":"representation or warranty, express or implied, as to their accuracy, or completeness, or otherwise.","page_number":130,"box":{"x":117,"y":723,"width":734,"height":12}},{"id":"badcdc1d-1074-4d9f-a04f-fad1beea4641","block_type":"box","text":"ICE reserves the right, at any time and without notice, to alter, amend, terminate or in any way change","page_number":130,"box":{"x":117,"y":754,"width":758,"height":12}},{"id":"ef69a957-44d9-49c4-9139-9d5f443b960c","block_type":"box","text":"an ICE BofA Index. ICE has no obligation to take the needs of any particular Fund or its participants or","page_number":130,"box":{"x":116,"y":769,"width":761,"height":12}},{"id":"19423cec-6c8c-451b-9c06-8f50bb1a6e6d","block_type":"box","text":"any other product or person into consideration in determining, composing or calculating an ICE BofA","page_number":130,"box":{"x":116,"y":785,"width":745,"height":12}},{"id":"87f200a7-d213-4715-9116-84ce2a1fb815","block_type":"box","text":"Index.","page_number":130,"box":{"x":117,"y":800,"width":43,"height":10}},{"id":"edd3a511-de74-4e25-a0b5-91bf76c35ad9","block_type":"box","text":"Indexed and Inverse Securities.","page_number":130,"box":{"x":116,"y":831,"width":250,"height":10}},{"id":"7df8e056-57b8-408d-828e-241fb9cb3674","block_type":"box","text":"A Fund may invest in securities that provide a potential return based","page_number":130,"box":{"x":367,"y":831,"width":517,"height":12}},{"id":"6efb7869-3f0d-486a-9bbb-568572fa6837","block_type":"box","text":"on a particular index of value or interest rates. For example, a Fund may invest in securities that pay","page_number":130,"box":{"x":116,"y":847,"width":749,"height":12}},{"id":"853d5002-e4be-43fb-b68b-b32266033c5b","block_type":"box","text":"interest based on an index of interest rates. The principal amount payable upon maturity of certain","page_number":130,"box":{"x":117,"y":862,"width":732,"height":12}},{"id":"0f38502b-bd1c-484c-9835-7f569f42d54e","block_type":"box","text":"securities also may be based on the value of the index. To the extent a Fund invests in these types of","page_number":130,"box":{"x":116,"y":878,"width":759,"height":12}},{"id":"e4767102-5e53-45f4-87b3-cede8b2d12f2","block_type":"box","text":"II-43","page_number":130,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"acbe5ce3-6bd3-4984-85e8-4d192848556d","block_type":"box","text":"NM1026U-6004382-130/605","page_number":130,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9222ce26-618c-4400-a4f9-17a329905682","block_type":"box","text":"securities, the Fund’s return on such securities will be subject to risk with respect to the value of the","page_number":131,"box":{"x":116,"y":87,"width":744,"height":12}},{"id":"29dd2b68-dfc4-41dc-b6b3-782b88a66f7b","block_type":"box","text":"particular index: that is, if the value of the index falls, the value of the indexed securities owned by the","page_number":131,"box":{"x":117,"y":102,"width":758,"height":13}},{"id":"c60969d4-8743-434d-811c-b442241bb38c","block_type":"box","text":"Fund will fall. 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As a result, the market","page_number":131,"box":{"x":116,"y":258,"width":757,"height":12}},{"id":"7387674e-eb28-4868-8edc-44169f790692","block_type":"box","text":"values of such securities will generally be more volatile than the market values of fixed-rate securities.","page_number":131,"box":{"x":116,"y":273,"width":761,"height":12}},{"id":"5abfefc5-f819-4cc3-a22f-634eddd9d310","block_type":"box","text":"To seek to limit the volatility of these securities, a Fund may purchase inverse floating obligations that","page_number":131,"box":{"x":116,"y":289,"width":758,"height":12}},{"id":"f5583428-6f8e-4261-b954-02b267cd2b95","block_type":"box","text":"have shorter-term maturities or that contain limitations on the extent to which the interest rate may","page_number":131,"box":{"x":117,"y":304,"width":732,"height":12}},{"id":"1fdbe932-803a-4db3-97c7-49cff890d76e","block_type":"box","text":"vary. Certain investments in such obligations may be illiquid. The Manager believes that indexed and","page_number":131,"box":{"x":116,"y":320,"width":754,"height":12}},{"id":"559374c1-9dbd-4d67-9e1e-ef3036dfd41d","block_type":"box","text":"inverse floating obligations represent flexible portfolio management instruments for a Fund that allow","page_number":131,"box":{"x":117,"y":335,"width":751,"height":12}},{"id":"870b9eaf-9a0c-444f-8329-6da88f18cdf5","block_type":"box","text":"the Fund to seek potential investment rewards, hedge other portfolio positions or vary the degree of","page_number":131,"box":{"x":116,"y":351,"width":744,"height":12}},{"id":"51eb4de8-35e1-418b-807e-5fe017cec78e","block_type":"box","text":"investment leverage relatively efficiently under different market conditions. A Fund may invest in","page_number":131,"box":{"x":117,"y":366,"width":716,"height":12}},{"id":"2b06f92a-6ec4-4a36-a8c0-7d6eee4fc533","block_type":"box","text":"indexed and inverse securities for hedging purposes or to seek to increase returns. When used for","page_number":131,"box":{"x":117,"y":382,"width":734,"height":12}},{"id":"5a7760ad-0095-4ab4-b104-1c77a1d712bf","block_type":"box","text":"hedging purposes, indexed and inverse securities involve correlation risk. Furthermore, where such a","page_number":131,"box":{"x":117,"y":397,"width":755,"height":12}},{"id":"779fef94-894d-4024-a30d-3d868c77343f","block_type":"box","text":"security includes a contingent liability, in the event of an adverse movement in the underlying index or","page_number":131,"box":{"x":116,"y":413,"width":759,"height":12}},{"id":"bf2fbe83-93fe-4142-ba41-ce358dff9ca2","block_type":"box","text":"interest rate, a Fund may be required to pay substantial additional margin to maintain the position.","page_number":131,"box":{"x":117,"y":428,"width":731,"height":12}},{"id":"22e13ba7-4c80-47cf-bec8-1fa75d848e7a","block_type":"box","text":"The Funds may invest up to 10% of their total assets in leveraged inverse floating rate debt","page_number":131,"box":{"x":116,"y":459,"width":682,"height":12}},{"id":"80ebd12b-78ee-41db-a969-1e1ac9574a65","block_type":"box","text":"instruments (“inverse floaters”). Inverse floaters are securities the potential of which is inversely related","page_number":131,"box":{"x":117,"y":475,"width":768,"height":12}},{"id":"0f9ee788-c5ed-413b-a3a7-01dc547b23b4","block_type":"box","text":"to changes in interest rates. In general, the return on inverse floaters will decrease when short-term","page_number":131,"box":{"x":116,"y":490,"width":743,"height":12}},{"id":"3d36553e-5098-4ecf-b432-2196fac2b56f","block_type":"box","text":"interest rates increase and increase when short-term rates decrease. Municipal tender option bonds,","page_number":131,"box":{"x":117,"y":506,"width":751,"height":12}},{"id":"924b8aa3-cf94-484f-9872-7013b84fb1bb","block_type":"box","text":"both taxable and tax-exempt, which may include inverse floating rate debt instruments, (including","page_number":131,"box":{"x":117,"y":521,"width":725,"height":12}},{"id":"3839a3ed-a4fa-48fd-ad10-26cea73a5129","block_type":"box","text":"residual interests thereon) are excluded from this 10% limitation.","page_number":131,"box":{"x":117,"y":537,"width":483,"height":12}},{"id":"9ac5a988-bded-4c5a-9709-a8e3bd5ce07b","block_type":"box","text":"Inflation Risk.","page_number":131,"box":{"x":116,"y":568,"width":109,"height":9}},{"id":"004fccee-998e-4186-a05b-77d7a61dd343","block_type":"box","text":"Like all funds, the Funds are subject to inflation risk. Inflation risk is the risk that the","page_number":131,"box":{"x":226,"y":568,"width":627,"height":12}},{"id":"0f4ed42e-d393-4d1c-b467-d256dd6cc4ae","block_type":"box","text":"present value of assets or income from investments will be less in the future as inflation decreases the","page_number":131,"box":{"x":117,"y":583,"width":763,"height":12}},{"id":"e8713e70-23f5-44e3-8931-87b69a419a22","block_type":"box","text":"value of money. As inflation increases, the present value of a Fund’s assets can decline as can the","page_number":131,"box":{"x":116,"y":599,"width":739,"height":12}},{"id":"77cf34c2-a633-4c60-87a9-fb14d106bbd9","block_type":"box","text":"value of a Fund’s distributions. Inflation rates may change frequently and significantly due to a number","page_number":131,"box":{"x":116,"y":614,"width":764,"height":12}},{"id":"1cc1a93a-0b42-4a9f-96fb-d29c319cedec","block_type":"box","text":"of potential factors, including, among others, unexpected economic shifts or changes in fiscal or","page_number":131,"box":{"x":116,"y":630,"width":716,"height":12}},{"id":"087f47a6-e150-47dc-9f32-9cddf0b04cc7","block_type":"box","text":"monetary policies.","page_number":131,"box":{"x":117,"y":645,"width":139,"height":12}},{"id":"02ff2179-c56c-4882-8684-020bd76370c7","block_type":"box","text":"Initial Public Offering (“IPO”) Risk.","page_number":131,"box":{"x":116,"y":676,"width":275,"height":12}},{"id":"42263a3e-4b32-47c8-be86-cd0cce6ab56a","block_type":"box","text":"The volume of IPOs and the levels at which the newly issued","page_number":131,"box":{"x":397,"y":676,"width":451,"height":12}},{"id":"849815ec-2c28-4c33-bbbb-0be8b6988399","block_type":"box","text":"stocks trade in the secondary market are affected by the performance of the stock market overall. If","page_number":131,"box":{"x":116,"y":692,"width":739,"height":12}},{"id":"21462f1f-8e9c-4a8d-b2b6-0e3efb1a9245","block_type":"box","text":"IPOs are brought to the market, availability may be limited and a Fund may not be able to buy any","page_number":131,"box":{"x":117,"y":707,"width":727,"height":12}},{"id":"524fc992-0722-40d5-93f3-f90bbf2f608e","block_type":"box","text":"shares at the offering price, or if it is able to buy shares, it may not be able to buy as many shares at","page_number":131,"box":{"x":116,"y":723,"width":744,"height":12}},{"id":"68868d52-7c58-4d04-b80a-8dce3d204771","block_type":"box","text":"the offering price as it would like. In addition, the prices of securities involved in IPOs are often subject","page_number":131,"box":{"x":116,"y":738,"width":758,"height":12}},{"id":"6e142462-30f0-4d27-a3ad-f65e11e90217","block_type":"box","text":"to greater and more unpredictable price changes than more established stocks. IPOs have the","page_number":131,"box":{"x":116,"y":754,"width":701,"height":12}},{"id":"6a78990d-ac24-46f2-9fdd-a40f6391c813","block_type":"box","text":"potential to produce substantial gains. A Fund may hold shares from an IPO for only a short period of","page_number":131,"box":{"x":117,"y":769,"width":751,"height":12}},{"id":"3a90529a-ac11-48ff-b9e5-108c31d1882e","block_type":"box","text":"time given possible price volatility. This may result in increased portfolio turnover and expenses, such","page_number":131,"box":{"x":116,"y":785,"width":752,"height":12}},{"id":"b3e3bfa3-d979-4563-a8d1-b9f1c5643f86","block_type":"box","text":"as commissions and transaction costs, and potentially result in taxable gains that the Fund will","page_number":131,"box":{"x":116,"y":800,"width":699,"height":12}},{"id":"66a867c2-430a-45cb-aac4-0961d1cfc413","block_type":"box","text":"subsequently distribute to shareholders. There is no assurance that any Fund will have access to","page_number":131,"box":{"x":116,"y":816,"width":720,"height":12}},{"id":"4ad47ce4-0755-46a1-b313-a76730165c27","block_type":"box","text":"profitable IPOs and therefore investors should not rely on any past gains from IPOs as an indication of","page_number":131,"box":{"x":117,"y":831,"width":763,"height":12}},{"id":"c51756af-0326-4eb9-8d6e-af01fec59001","block_type":"box","text":"future performance. The investment performance of a Fund during periods when it is unable to invest","page_number":131,"box":{"x":116,"y":847,"width":755,"height":12}},{"id":"2ba52a7e-133d-4a7f-8fea-73c4b740fa7c","block_type":"box","text":"significantly or at all in IPOs may be lower than during periods when it is able to do so. In addition, as a","page_number":131,"box":{"x":116,"y":862,"width":769,"height":12}},{"id":"24348ebe-565c-4ad3-913f-5c7c14fdc607","block_type":"box","text":"Fund increases in size, the impact of IPOs on its performance will generally decrease. Securities","page_number":131,"box":{"x":117,"y":878,"width":721,"height":12}},{"id":"00aab10d-5e86-4818-b0d2-ec3c0be86d99","block_type":"box","text":"II-44","page_number":131,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"d84ebc5e-8a94-4206-9198-a206b47a0558","block_type":"box","text":"NM1026U-6004382-131/605","page_number":131,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f5e86ba7-f685-490d-932e-72d687ef6e0f","block_type":"box","text":"issued in IPOs are subject to many of the same risks as investing in companies with smaller market","page_number":132,"box":{"x":117,"y":87,"width":743,"height":12}},{"id":"412ea10e-130d-4dde-8e84-69e9119119cd","block_type":"box","text":"capitalizations. Securities issued in IPOs have no trading history, and information about the companies","page_number":132,"box":{"x":116,"y":102,"width":768,"height":13}},{"id":"504b1574-af02-4818-a1eb-d6af68500b52","block_type":"box","text":"may be available for very limited periods.","page_number":132,"box":{"x":117,"y":118,"width":308,"height":12}},{"id":"263e69a2-3b8c-444e-b183-bedb13e670fb","block_type":"box","text":"Investment in Emerging Markets.","page_number":132,"box":{"x":116,"y":157,"width":268,"height":12}},{"id":"c9f2fc00-8aab-404f-b044-574b17062acd","block_type":"box","text":"General","page_number":132,"box":{"x":117,"y":180,"width":59,"height":10}},{"id":"292ed0c2-2c41-4d89-82a9-4a9e96f888ff","block_type":"box","text":".","page_number":132,"box":{"x":177,"y":188,"width":8,"height":1}},{"id":"22dc76b2-c343-4a53-b2f0-3b6807828e75","block_type":"box","text":"Certain Funds may invest in the securities of issuers domiciled in various countries with emerging","page_number":132,"box":{"x":117,"y":211,"width":727,"height":12}},{"id":"060a8d7e-bf55-4f80-a8f5-d7b3c1e56c07","block_type":"box","text":"capital markets. Unless otherwise provided in a Fund’s Prospectus, a country with an emerging capital","page_number":132,"box":{"x":116,"y":227,"width":765,"height":12}},{"id":"e1d5d059-991e-4d95-9a58-17c19ac63c91","block_type":"box","text":"market is any country that is (i) generally recognized to be an emerging market country by the","page_number":132,"box":{"x":117,"y":242,"width":700,"height":12}},{"id":"9515778a-7689-46ad-900a-6d5adf7ea3d2","block_type":"box","text":"international financial community, such as the International Finance Corporation, or","page_number":132,"box":{"x":117,"y":258,"width":617,"height":12}},{"id":"893ab646-9f4a-49bc-b534-ec24d5494686","block_type":"box","text":"determined by the","page_number":132,"box":{"x":739,"y":258,"width":139,"height":12}},{"id":"f6c385f4-8b19-4943-a5b2-549b46bbdf4b","block_type":"box","text":"World Bank to have a low, middle or middle upper income economy; (ii) classified by the United","page_number":132,"box":{"x":116,"y":273,"width":714,"height":12}},{"id":"ac51cb35-994a-450c-963a-342e1746c5b9","block_type":"box","text":"Nations or its authorities to be developing; and/or (iii) included in a broad-based index that is generally","page_number":132,"box":{"x":117,"y":289,"width":762,"height":12}},{"id":"7c58c810-62d7-42a9-98ec-05b77ad8f22c","block_type":"box","text":"representative of emerging markets. Countries with emerging markets can be found in regions such as","page_number":132,"box":{"x":117,"y":304,"width":766,"height":12}},{"id":"29b64637-dda6-4652-b784-92143620824d","block_type":"box","text":"Asia, Latin America, Eastern Europe and Africa.","page_number":132,"box":{"x":116,"y":320,"width":361,"height":12}},{"id":"bbdd943f-17bf-42cc-8ea4-d6ca9d77b750","block_type":"box","text":"Investments in the securities of issuers domiciled in countries with emerging capital markets involve","page_number":132,"box":{"x":117,"y":351,"width":743,"height":12}},{"id":"f1e2bc1f-9970-424f-bf42-7ea4cab8d9ce","block_type":"box","text":"certain additional risks that do not generally apply to investments in securities of issuers in more","page_number":132,"box":{"x":116,"y":366,"width":717,"height":12}},{"id":"03e78825-3ea9-4258-bfab-df5797d69233","block_type":"box","text":"developed capital markets, such as (i) low or non-existent trading volume, resulting in market illiquidity","page_number":132,"box":{"x":116,"y":382,"width":763,"height":12}},{"id":"19142979-51b6-4826-9ae3-562fb9ddddaf","block_type":"box","text":"and increased volatility in prices for such securities, as compared to securities of comparable issuers in","page_number":132,"box":{"x":116,"y":397,"width":771,"height":12}},{"id":"d777a445-b8cc-4604-97ef-6de2351b4c1f","block_type":"box","text":"more developed capital markets; (ii) uncertain national policies and social, political and economic","page_number":132,"box":{"x":117,"y":413,"width":723,"height":12}},{"id":"aeb2c7b9-706b-4952-88ae-a317ee6a3cf2","block_type":"box","text":"instability, increasing the potential for expropriation of assets, confiscatory taxation, high rates of","page_number":132,"box":{"x":117,"y":428,"width":718,"height":12}},{"id":"48ad7438-eeea-4746-b562-f8f23c3f6a54","block_type":"box","text":"inflation or unfavorable diplomatic developments; (iii) possible fluctuations in exchange rates, differing","page_number":132,"box":{"x":117,"y":444,"width":758,"height":12}},{"id":"c4a4c791-12e6-4ebd-9236-b0c77ff5757b","block_type":"box","text":"legal systems and the existence or possible imposition of exchange controls, custodial restrictions or","page_number":132,"box":{"x":117,"y":459,"width":750,"height":12}},{"id":"8d80f1c9-4b69-44c0-85a1-2cc8cec50ae9","block_type":"box","text":"other foreign or U.S. Governmental laws or restrictions applicable to such investments; (iv) national","page_number":132,"box":{"x":116,"y":475,"width":741,"height":12}},{"id":"f8080165-0034-43d0-b966-2d9bdf47c8f8","block_type":"box","text":"policies that may limit a Fund’s investment opportunities such as restrictions on investment in issuers","page_number":132,"box":{"x":117,"y":490,"width":754,"height":12}},{"id":"5d331c7a-b96a-4653-a018-5aafd22f17bc","block_type":"box","text":"or industries deemed sensitive to national interests; and (v) the lack or relatively early development of","page_number":132,"box":{"x":116,"y":506,"width":759,"height":12}},{"id":"fd05a94a-97ff-424a-82f6-265d3ed3d3b8","block_type":"box","text":"legal structures governing private and foreign investments and private property. In addition to","page_number":132,"box":{"x":117,"y":521,"width":695,"height":12}},{"id":"b46110a3-3f6e-49e0-8736-87309844ea58","block_type":"box","text":"withholding taxes on investment income, some countries with emerging markets may impose","page_number":132,"box":{"x":116,"y":537,"width":695,"height":12}},{"id":"93219b1f-6cba-4139-8aa8-38f8ecea6281","block_type":"box","text":"differential capital gains taxes on foreign investors.","page_number":132,"box":{"x":116,"y":552,"width":381,"height":12}},{"id":"fb518b3d-b42e-41c2-9f2b-a9817b4512d1","block_type":"box","text":"Political and economic structures in emerging market countries may be undergoing significant","page_number":132,"box":{"x":117,"y":583,"width":699,"height":12}},{"id":"912357e4-6918-4836-94d8-946f588b6739","block_type":"box","text":"evolution and rapid development, and these countries may lack the social, political and economic","page_number":132,"box":{"x":116,"y":599,"width":726,"height":12}},{"id":"f481e87e-9179-4278-afa1-c5b1fb260ad0","block_type":"box","text":"stability characteristic of more developed countries. In such a dynamic environment, there can be no","page_number":132,"box":{"x":116,"y":614,"width":750,"height":12}},{"id":"b7e76063-f945-4e83-9bf6-cbc17b00291c","block_type":"box","text":"assurance that any or all of these capital markets will continue to present viable investment","page_number":132,"box":{"x":116,"y":630,"width":681,"height":12}},{"id":"ffa37487-e195-4b13-b6d1-2702b4191600","block_type":"box","text":"opportunities for a Fund. In the past, governments of such nations have expropriated substantial","page_number":132,"box":{"x":116,"y":645,"width":719,"height":12}},{"id":"6fee9b6a-501e-4837-8681-e73fe3f4b501","block_type":"box","text":"amounts of private property, and most claims of the property owners have never been fully settled.","page_number":132,"box":{"x":116,"y":661,"width":730,"height":12}},{"id":"44efb696-db4c-4c9b-9a66-5ed8d0cc7a35","block_type":"box","text":"There is no assurance that such expropriations will not reoccur. In such an event, it is possible that a","page_number":132,"box":{"x":116,"y":676,"width":747,"height":12}},{"id":"08b8a642-f2a4-464d-ac38-ba059b016fc4","block_type":"box","text":"Fund could lose the entire value of its investments in the affected market. As a result the risks","page_number":132,"box":{"x":117,"y":692,"width":694,"height":9}},{"id":"45f395e8-cb60-40f2-b1ee-226599f05265","block_type":"box","text":"described above, including the risks of nationalization or expropriation of assets, may be heightened. In","page_number":132,"box":{"x":116,"y":707,"width":766,"height":12}},{"id":"13e5c68d-ec07-4772-983e-a0a14108202e","block_type":"box","text":"addition, unanticipated political or social developments may affect the value of investments in these","page_number":132,"box":{"x":116,"y":723,"width":737,"height":12}},{"id":"1e7ee03c-0a6d-4bc3-ae47-0658c8a8a307","block_type":"box","text":"countries and the availability to a Fund of additional investments. The small size and inexperience of","page_number":132,"box":{"x":116,"y":738,"width":746,"height":12}},{"id":"d9254caf-3d77-4eb4-86ad-5039cc9da9b2","block_type":"box","text":"the securities markets in certain of these countries and the limited volume of trading in securities in","page_number":132,"box":{"x":116,"y":754,"width":732,"height":12}},{"id":"28c894c7-f709-48f4-ab32-7d3c86521057","block_type":"box","text":"these countries may make investments in the countries illiquid and more volatile than investments in","page_number":132,"box":{"x":116,"y":769,"width":742,"height":12}},{"id":"ff3462dc-3f9f-4941-b5d4-67c4e0d11330","block_type":"box","text":"more established markets.","page_number":132,"box":{"x":117,"y":785,"width":195,"height":9}},{"id":"4be6aa5c-4c20-44d5-b13f-e2a2cd4174ac","block_type":"box","text":"Also, there may be less publicly available information about issuers in emerging markets than would be","page_number":132,"box":{"x":116,"y":816,"width":765,"height":12}},{"id":"b268b68f-d78b-46b1-a1e6-49bfb1f6396b","block_type":"box","text":"available about issuers in more developed capital markets, and such issuers may not be subject to","page_number":132,"box":{"x":116,"y":831,"width":737,"height":12}},{"id":"5ae09578-c2b7-436a-b44b-4b12b2f7c560","block_type":"box","text":"accounting, auditing and financial reporting standards and requirements comparable to those to which","page_number":132,"box":{"x":116,"y":847,"width":762,"height":12}},{"id":"e738d22b-08cd-49ca-a354-0670266035b7","block_type":"box","text":"U.S. companies are subject. In certain countries with emerging capital markets, reporting standards","page_number":132,"box":{"x":117,"y":862,"width":743,"height":12}},{"id":"9d6b64ff-72db-475b-8331-253c6f3253bd","block_type":"box","text":"vary widely. As a result, traditional investment measurements used in the United States, such as price/","page_number":132,"box":{"x":116,"y":878,"width":762,"height":12}},{"id":"d801019e-a5ac-4ae1-9eb6-f69974565497","block_type":"box","text":"II-45","page_number":132,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"0c1563ee-8662-4edb-ae14-772eb8ef3e2a","block_type":"box","text":"NM1026U-6004382-132/605","page_number":132,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f311a880-ad84-4d4c-9355-3bc867ecc14b","block_type":"box","text":"earnings ratios, may not be applicable. Emerging market securities may be substantially less liquid","page_number":133,"box":{"x":116,"y":87,"width":737,"height":12}},{"id":"8147fb2b-1b58-40e6-bd1e-e59de3a7e771","block_type":"box","text":"than, and more volatile than, those of mature markets, and company shares may be held by a limited","page_number":133,"box":{"x":116,"y":102,"width":755,"height":13}},{"id":"11192d61-0dda-40e4-9d7d-69bc934fe608","block_type":"box","text":"number of persons. This may adversely affect the timing and pricing of the Fund’s acquisition or","page_number":133,"box":{"x":117,"y":118,"width":715,"height":12}},{"id":"80a07ad9-01dc-463f-ac49-3d1cfbd6fc38","block_type":"box","text":"disposal of securities.","page_number":133,"box":{"x":116,"y":134,"width":165,"height":11}},{"id":"7296765c-e2d5-4911-a764-efd56b7f50b1","block_type":"box","text":"Practices in relation to settlement of securities transactions in emerging markets involve higher risks","page_number":133,"box":{"x":117,"y":165,"width":746,"height":12}},{"id":"b609bcb8-7814-4b3c-ac31-a5d7e29c1cd2","block_type":"box","text":"than those in developed markets, in part because a Fund will need to use brokers and counterparties","page_number":133,"box":{"x":116,"y":180,"width":755,"height":12}},{"id":"27a31a66-3ea7-44a7-bcd1-96cb25c1df12","block_type":"box","text":"that are less well capitalized, and custody and registration of assets in some countries may be","page_number":133,"box":{"x":116,"y":196,"width":703,"height":12}},{"id":"ff46d7f3-7ad9-40c4-8270-2141ef3de0ff","block_type":"box","text":"unreliable. The possibility of fraud, negligence, undue influence being exerted by the issuer or refusal","page_number":133,"box":{"x":117,"y":211,"width":754,"height":12}},{"id":"a16700e0-1389-49ad-a952-301a2afe9653","block_type":"box","text":"to recognize ownership exists in some emerging markets, and, along with other factors, could result in","page_number":133,"box":{"x":116,"y":227,"width":762,"height":12}},{"id":"31ac68c1-7a3e-4d2e-bf56-bcbde371c59c","block_type":"box","text":"ownership registration being completely lost. A Fund would absorb any loss resulting from such","page_number":133,"box":{"x":116,"y":242,"width":712,"height":12}},{"id":"3fad2066-6ea4-4fb8-b6a4-6efc77c4c94d","block_type":"box","text":"registration problems and may have no successful claim for compensation.","page_number":133,"box":{"x":117,"y":258,"width":560,"height":12}},{"id":"ddb8a6ca-6a50-4aa7-8477-17f5e8d22165","block_type":"box","text":"Investment in non-dollar denominated securities including securities from issuers located in emerging","page_number":133,"box":{"x":117,"y":289,"width":755,"height":12}},{"id":"4d807379-d2fe-4a5e-b9bd-2a9d48674c0a","block_type":"box","text":"market countries may be on either a currency hedged or unhedged basis, and the Funds may hold","page_number":133,"box":{"x":117,"y":304,"width":735,"height":12}},{"id":"c5379a16-44e5-4a1c-ab71-47f1c748758a","block_type":"box","text":"from time to time various foreign currencies pending investment or conversion into U.S. dollars. Some","page_number":133,"box":{"x":116,"y":320,"width":761,"height":12}},{"id":"8c1779ad-38f0-40bd-9e06-1d13a5986647","block_type":"box","text":"of these instruments may have the characteristics of futures contracts. In addition, certain Funds may","page_number":133,"box":{"x":116,"y":335,"width":757,"height":12}},{"id":"149bf998-5dcd-4ac6-85ea-16f52d84e0d0","block_type":"box","text":"engage in foreign currency exchange transactions to seek to protect against changes in the level of","page_number":133,"box":{"x":116,"y":351,"width":742,"height":12}},{"id":"846101af-aedf-47b2-89b4-2ff02a4e12fa","block_type":"box","text":"future exchange rates which would adversely affect the Fund’s performance. These investments and","page_number":133,"box":{"x":116,"y":366,"width":752,"height":12}},{"id":"a8766833-4b7e-4f93-8ef7-0275221b7541","block_type":"box","text":"transactions involving foreign securities, currencies, options (including options that relate to foreign","page_number":133,"box":{"x":116,"y":382,"width":738,"height":12}},{"id":"66dfad49-6aa4-4bd2-9a8b-265d6aafffe0","block_type":"box","text":"currencies), futures, hedging and cross-hedging are described under “Derivatives.”","page_number":133,"box":{"x":116,"y":397,"width":619,"height":12}},{"id":"e77316ea-8f02-4760-b533-21ade2f8030a","block_type":"box","text":"Risks of Investing in Asia-Pacific Countries.","page_number":133,"box":{"x":116,"y":428,"width":328,"height":12}},{"id":"6658636a-9167-4de9-8b82-8d45ef471651","block_type":"box","text":"In addition to the risks of foreign investing and the risks of","page_number":133,"box":{"x":445,"y":428,"width":432,"height":12}},{"id":"eede6d93-8f91-4e7c-a79a-c31eb3bc1837","block_type":"box","text":"investing in developing markets, the developing market Asia-Pacific countries in which a Fund may","page_number":133,"box":{"x":117,"y":444,"width":738,"height":12}},{"id":"b352b045-a052-4456-aab1-8a3de49cec7e","block_type":"box","text":"invest are subject to certain additional or specific risks. Certain Funds may make substantial","page_number":133,"box":{"x":117,"y":459,"width":687,"height":12}},{"id":"d6bc500d-4c48-4e15-a5a1-c9aa06b09f1f","block_type":"box","text":"investments in Asia-Pacific countries. In many of these markets, there is a high concentration of market","page_number":133,"box":{"x":117,"y":475,"width":771,"height":12}},{"id":"b2139c39-002d-4f7f-bf62-284310ffb211","block_type":"box","text":"capitalization and trading volume in a small number of issuers representing a limited number of","page_number":133,"box":{"x":116,"y":490,"width":710,"height":12}},{"id":"a31e332d-7d17-4636-b107-a2f4c2a11684","block_type":"box","text":"industries, as well as a high concentration of investors and financial intermediaries. Many of these","page_number":133,"box":{"x":117,"y":506,"width":730,"height":12}},{"id":"0f7af16f-2852-4df3-b234-20b0ad61eaac","block_type":"box","text":"markets also may be affected by developments with respect to more established markets in the region","page_number":133,"box":{"x":117,"y":521,"width":763,"height":12}},{"id":"ec279751-10ee-41c4-b9b3-2d84fce60dc7","block_type":"box","text":"such as in Japan and Hong Kong. Brokers in developing market Asia-Pacific countries typically are","page_number":133,"box":{"x":116,"y":537,"width":739,"height":12}},{"id":"c8f4b5ae-0961-4b10-a288-ba2f733b12de","block_type":"box","text":"fewer in number and less well capitalized than brokers in the United States. These factors, combined","page_number":133,"box":{"x":116,"y":552,"width":754,"height":12}},{"id":"3aafe478-21ad-4ca8-87f5-3ad66b0d783c","block_type":"box","text":"with the U.S. regulatory requirements for open-end investment companies and the restrictions on","page_number":133,"box":{"x":116,"y":568,"width":725,"height":12}},{"id":"d11a5afc-69a1-4434-8431-15cb90ec03f1","block_type":"box","text":"foreign investment discussed below, result in potentially fewer investment opportunities for a Fund and","page_number":133,"box":{"x":116,"y":583,"width":766,"height":12}},{"id":"c9eba29c-e8de-4f26-bb84-cb9f740215da","block_type":"box","text":"may have an adverse impact on the investment performance of the Fund.","page_number":133,"box":{"x":117,"y":599,"width":550,"height":12}},{"id":"a3c5e7df-2bcd-4d84-8e52-2dd3f9cf3a5a","block_type":"box","text":"Many of the developing market Asia-Pacific countries may be subject to a greater degree of economic,","page_number":133,"box":{"x":117,"y":630,"width":765,"height":12}},{"id":"66cd1c0a-ac1e-44e1-83f5-01b3f6fc8e1c","block_type":"box","text":"political and social instability than is the case in the United States and Western European countries.","page_number":133,"box":{"x":117,"y":645,"width":743,"height":12}},{"id":"fa958098-a787-4f55-b7fb-df37243f8b9c","block_type":"box","text":"Such instability may result from, among other things: (i) authoritarian governments or military","page_number":133,"box":{"x":116,"y":661,"width":688,"height":12}},{"id":"b72d532d-a21a-4b75-a608-19b00d1cc26e","block_type":"box","text":"involvement in political and economic decision-making, including changes in government through","page_number":133,"box":{"x":117,"y":676,"width":718,"height":12}},{"id":"073ce8d3-21a1-42a8-ac0a-bc1502b75a72","block_type":"box","text":"extra-constitutional means; (ii) popular unrest associated with demands for improved political,","page_number":133,"box":{"x":116,"y":692,"width":692,"height":12}},{"id":"da868a4a-4e08-4edc-b1b9-1f880d69cfa9","block_type":"box","text":"economic and social conditions; (iii) internal insurgencies; (iv) hostile relations with neighboring","page_number":133,"box":{"x":116,"y":707,"width":704,"height":12}},{"id":"61ee0df2-b565-461a-a7e7-b7b741277864","block_type":"box","text":"countries; and (v) ethnic, religious and racial disaffection. In addition, the governments of many of such","page_number":133,"box":{"x":116,"y":723,"width":763,"height":12}},{"id":"1bfb5625-a8da-4acf-afcf-fa9c5ffc1536","block_type":"box","text":"countries, such as Indonesia, have a substantial role in regulating and supervising the economy.","page_number":133,"box":{"x":116,"y":738,"width":714,"height":12}},{"id":"e2fcbe20-6c4d-4f8c-8dc4-d846a53e995d","block_type":"box","text":"Another risk common to most such countries is that the economy is heavily export oriented and,","page_number":133,"box":{"x":116,"y":754,"width":710,"height":12}},{"id":"0e67e592-35ef-4a65-a0bc-e80c20946beb","block_type":"box","text":"accordingly, is dependent upon international trade. The existence of overburdened infrastructure and","page_number":133,"box":{"x":116,"y":769,"width":748,"height":12}},{"id":"69c60174-9f83-4674-8e7e-055dffd411ee","block_type":"box","text":"obsolete financial systems also presents risks in certain countries, as do environmental problems.","page_number":133,"box":{"x":116,"y":785,"width":724,"height":12}},{"id":"1143d158-7c61-429b-8c3f-6e2e885b5f0a","block_type":"box","text":"Certain economies also depend to a significant degree upon exports of primary commodities and,","page_number":133,"box":{"x":117,"y":800,"width":721,"height":12}},{"id":"8fbb21f2-1dfd-4652-b29c-f54e7dc66c75","block_type":"box","text":"therefore, are vulnerable to changes in commodity prices that, in turn, may be affected by a variety of","page_number":133,"box":{"x":116,"y":816,"width":752,"height":12}},{"id":"a4acd287-172a-4ec5-9f66-5d113cdce4e5","block_type":"box","text":"factors.","page_number":133,"box":{"x":116,"y":831,"width":60,"height":10}},{"id":"26b58ae8-ed45-4690-9440-90985a30d750","block_type":"box","text":"The legal systems in certain developing market Asia-Pacific countries also may have an adverse","page_number":133,"box":{"x":116,"y":862,"width":722,"height":12}},{"id":"aacb8ccd-3f31-4fac-89c9-b32fe4a519d8","block_type":"box","text":"impact on the Fund. For example, while the potential liability of a shareholder in a U.S. corporation with","page_number":133,"box":{"x":117,"y":878,"width":769,"height":12}},{"id":"281138ea-b0cc-447b-a97f-45d86a46b064","block_type":"box","text":"II-46","page_number":133,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"71a42daf-bae8-49b3-a201-6d5959d3861b","block_type":"box","text":"NM1026U-6004382-133/605","page_number":133,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"72725e1d-77bf-44cc-aaf9-13ec547bb56e","block_type":"box","text":"respect to acts of the corporation is generally limited to the amount of the shareholder’s investment, the","page_number":134,"box":{"x":117,"y":87,"width":771,"height":12}},{"id":"067ce747-1780-456c-99f0-e53522273158","block_type":"box","text":"notion of limited liability is less clear in certain emerging market Asia-Pacific countries. Similarly, the","page_number":134,"box":{"x":117,"y":102,"width":744,"height":13}},{"id":"3f6fe16a-4daf-4073-88a0-9e1963de4660","block_type":"box","text":"rights of investors in developing market Asia-Pacific companies may be more limited than those of","page_number":134,"box":{"x":117,"y":118,"width":732,"height":12}},{"id":"d280c2d9-5978-4ced-ae36-5edb48ea8540","block_type":"box","text":"shareholders of U.S. corporations. It may be difficult or impossible to obtain and/or enforce a judgment","page_number":134,"box":{"x":116,"y":134,"width":765,"height":12}},{"id":"22133860-be33-4ad0-aa06-78220a92ba5b","block_type":"box","text":"in a developing market Asia-Pacific country.","page_number":134,"box":{"x":117,"y":149,"width":330,"height":12}},{"id":"a1b50487-299a-4c3f-a47c-bc24251943bf","block_type":"box","text":"Governments of many developing market Asia-Pacific countries have exercised and continue to","page_number":134,"box":{"x":117,"y":180,"width":714,"height":12}},{"id":"16dd9e5d-d66e-4771-b1c9-a14d76b51189","block_type":"box","text":"exercise substantial influence over many aspects of the private sector. In certain cases, the","page_number":134,"box":{"x":116,"y":196,"width":683,"height":12}},{"id":"2962c1df-2abd-4162-b9c2-591a4473070f","block_type":"box","text":"government owns or controls many companies, including the largest in the country. Accordingly,","page_number":134,"box":{"x":116,"y":211,"width":718,"height":12}},{"id":"c1b730f1-128e-418d-b088-40d20d59f17f","block_type":"box","text":"government actions in the future could have a significant effect on economic conditions in developing","page_number":134,"box":{"x":116,"y":227,"width":755,"height":12}},{"id":"2415a265-534f-4d49-9150-8e522a94f28e","block_type":"box","text":"market Asia-Pacific countries, which could affect private sector companies and a Fund itself, as well as","page_number":134,"box":{"x":117,"y":242,"width":768,"height":12}},{"id":"f227379b-c1c1-4b79-927f-6d8ea6a2f220","block_type":"box","text":"the value of securities in the Fund’s portfolio. In addition, economic statistics of developing market","page_number":134,"box":{"x":116,"y":258,"width":731,"height":12}},{"id":"45ec38e5-1427-440a-bc5d-c39227d654f8","block_type":"box","text":"Asia-Pacific countries may be less reliable than economic statistics of more developed nations.","page_number":134,"box":{"x":116,"y":273,"width":710,"height":12}},{"id":"ea5bb6e0-7171-4089-8f1e-7823e64b8540","block_type":"box","text":"In addition to the relative lack of publicly available information about developing market Asia-Pacific","page_number":134,"box":{"x":117,"y":304,"width":741,"height":12}},{"id":"98f0b346-e44f-4910-bad4-ba8550af6894","block_type":"box","text":"issuers and the possibility that such issuers may not be subject to the same accounting, auditing and","page_number":134,"box":{"x":117,"y":320,"width":752,"height":12}},{"id":"c2318691-e262-4811-aa20-f741c3ab8ce2","block_type":"box","text":"financial reporting standards as U.S. companies, inflation accounting rules in some developing market","page_number":134,"box":{"x":116,"y":335,"width":762,"height":12}},{"id":"2bbfe622-2451-458f-95eb-04e63d596829","block_type":"box","text":"Asia-Pacific countries require companies that keep accounting records in the local currency, for both","page_number":134,"box":{"x":116,"y":351,"width":750,"height":12}},{"id":"be9adace-ee28-4605-8e24-a8595d82e4cf","block_type":"box","text":"tax and accounting purposes, to restate certain assets and liabilities on the company’s balance sheet","page_number":134,"box":{"x":116,"y":366,"width":755,"height":12}},{"id":"74cb229e-2d25-4590-a034-72a68fb7d0ae","block_type":"box","text":"in order to express items in terms of currency of constant purchasing power. Inflation accounting may","page_number":134,"box":{"x":117,"y":382,"width":756,"height":12}},{"id":"0b2f7171-7d77-430d-b3bd-58ae31f6ff1b","block_type":"box","text":"indirectly generate losses or profits for certain developing market Asia-Pacific companies.","page_number":134,"box":{"x":117,"y":397,"width":669,"height":12}},{"id":"ddb54c4e-f53b-48b6-a854-79e523f129a9","block_type":"box","text":"Satisfactory custodial services for investment securities may not be available in some developing Asia","page_number":134,"box":{"x":116,"y":428,"width":762,"height":12}},{"id":"29a6364d-8645-4967-950e-eec2dd87649f","block_type":"box","text":"Pacific countries, which may result in the Fund incurring additional costs and delays in providing","page_number":134,"box":{"x":117,"y":444,"width":716,"height":12}},{"id":"b513fd98-a29b-42de-9a13-980419ea4560","block_type":"box","text":"transportation and custody services for such securities outside such countries.","page_number":134,"box":{"x":116,"y":459,"width":586,"height":12}},{"id":"831711fe-49a4-4d08-b31c-5ed0537c1053","block_type":"box","text":"Certain developing Asia-Pacific countries, such as the Philippines, India and Turkey, are especially","page_number":134,"box":{"x":117,"y":490,"width":738,"height":12}},{"id":"9bcafefa-f534-423f-b611-e387d822a65e","block_type":"box","text":"large debtors to commercial banks and foreign governments.","page_number":134,"box":{"x":117,"y":506,"width":456,"height":12}},{"id":"c53530e1-58c4-42b2-bc4a-2ae4c4a66a17","block_type":"box","text":"Natural disasters in Asia-Pacific countries, and the resulting damage, could have a severe and","page_number":134,"box":{"x":117,"y":537,"width":705,"height":12}},{"id":"fd570271-75b6-4941-98c6-4b4ce5faf836","block_type":"box","text":"negative impact on a Fund’s investment portfolio and, in the longer term, could impair the ability of","page_number":134,"box":{"x":117,"y":552,"width":732,"height":12}},{"id":"4c4c37c5-f9ea-4e18-9478-9b17a98c5bd3","block_type":"box","text":"issuers in which the Fund invests to conduct their businesses in the manner normally conducted.","page_number":134,"box":{"x":117,"y":568,"width":722,"height":12}},{"id":"90f8b4dc-fb73-4d89-b95d-15fd54754a60","block_type":"box","text":"Fund management may determine that, notwithstanding otherwise favorable investment criteria, it may","page_number":134,"box":{"x":117,"y":599,"width":766,"height":12}},{"id":"0b08e231-4783-4b48-909a-a1be7cd50233","block_type":"box","text":"not be practicable or appropriate to invest in a particular developing Asia-Pacific country. A Fund may","page_number":134,"box":{"x":117,"y":614,"width":757,"height":12}},{"id":"58005381-6d2f-4270-9325-157edf536dcd","block_type":"box","text":"invest in countries in which foreign investors, including management of the Fund, have had no or","page_number":134,"box":{"x":117,"y":630,"width":722,"height":12}},{"id":"5990a268-85da-47b3-b1ec-ad711920b25f","block_type":"box","text":"limited prior experience.","page_number":134,"box":{"x":117,"y":645,"width":182,"height":12}},{"id":"f20d66d3-3a0f-4a89-a2f0-7b81d9195a3b","block_type":"box","text":"Restrictions on Foreign Investments in Asia-Pacific Countries.","page_number":134,"box":{"x":116,"y":676,"width":458,"height":12}},{"id":"b2f79365-dca2-4346-bfa0-ca649b898904","block_type":"box","text":"Some developing Asia-Pacific countries","page_number":134,"box":{"x":581,"y":676,"width":294,"height":12}},{"id":"c0a26a03-8914-4cbd-84e3-33db7474d11f","block_type":"box","text":"prohibit or impose substantial restrictions on investments in their capital markets, particularly their","page_number":134,"box":{"x":117,"y":692,"width":723,"height":12}},{"id":"4dc02c8f-5d82-4b1f-894e-f50aa8d3201f","block_type":"box","text":"equity markets, by foreign entities such as a Fund. As illustrations, certain countries may require","page_number":134,"box":{"x":116,"y":707,"width":714,"height":12}},{"id":"21f637b4-864c-44df-b1b7-64739c2354e6","block_type":"box","text":"governmental approval prior to investments by foreign persons or limit the amount of investment by","page_number":134,"box":{"x":116,"y":723,"width":736,"height":12}},{"id":"c6b09d09-4667-4962-b61d-15281ad2c7f7","block_type":"box","text":"foreign persons in a particular company or limit the investment by foreign persons to only a specific","page_number":134,"box":{"x":116,"y":738,"width":735,"height":12}},{"id":"98a83af5-d948-4c07-9d44-0d0292b6ecc2","block_type":"box","text":"class of securities of a company which may have less advantageous terms (including price and","page_number":134,"box":{"x":116,"y":754,"width":705,"height":12}},{"id":"806e8874-50f5-4035-bf50-c7b18dc4dc52","block_type":"box","text":"shareholder rights) than securities of the company available for purchase by nationals. There can be","page_number":134,"box":{"x":116,"y":769,"width":745,"height":12}},{"id":"5c095047-8c8e-44d8-a0ab-11b5a24a91a3","block_type":"box","text":"no assurance that a Fund will be able to obtain required governmental approvals in a timely manner. In","page_number":134,"box":{"x":117,"y":785,"width":762,"height":12}},{"id":"69d6d8bf-eb47-4ea9-b150-4e305b5e456d","block_type":"box","text":"addition, changes to restrictions on foreign ownership of securities subsequent to a Fund’s purchase of","page_number":134,"box":{"x":116,"y":800,"width":765,"height":12}},{"id":"8739002b-bc8b-4e8c-a9ca-c4f95aefd1d4","block_type":"box","text":"such securities may have an adverse effect on the value of such shares. Certain countries may restrict","page_number":134,"box":{"x":116,"y":816,"width":761,"height":12}},{"id":"f740da8c-19e0-4057-9864-d19469bab5a2","block_type":"box","text":"investment opportunities in issuers or industries deemed important to national interests.","page_number":134,"box":{"x":117,"y":831,"width":654,"height":12}},{"id":"09bce7a9-8382-48cb-80dc-f9a32edf0c97","block_type":"box","text":"The manner in which foreign investors may invest in companies in certain developing Asia-Pacific","page_number":134,"box":{"x":116,"y":862,"width":729,"height":12}},{"id":"b55a80c4-507d-40d4-a043-9e82a8da611a","block_type":"box","text":"countries, as well as limitations on such investments, also may have an adverse impact on the","page_number":134,"box":{"x":116,"y":878,"width":705,"height":12}},{"id":"a4b43de1-80c7-46a2-a9ef-043a06c4b1ae","block_type":"box","text":"II-47","page_number":134,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"38559d6f-7fa7-48a7-abbb-6644ea8b2c3d","block_type":"box","text":"NM1026U-6004382-134/605","page_number":134,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"67cb1c4b-f800-474f-a32a-d27ccbe5e2d6","block_type":"box","text":"operations of a Fund. For example, a Fund may be required in certain of such countries to invest","page_number":135,"box":{"x":116,"y":87,"width":722,"height":12}},{"id":"4b129256-7e4b-46f7-b841-80879cb64765","block_type":"box","text":"initially through a local broker or other entity and then have the shares purchased re-registered in the","page_number":135,"box":{"x":117,"y":103,"width":753,"height":12}},{"id":"19f5e7f4-94be-4de3-b25f-a38f5dda3bea","block_type":"box","text":"name of the Fund. Re-registration may in some instances not be able to occur on a timely basis,","page_number":135,"box":{"x":117,"y":118,"width":718,"height":12}},{"id":"b8c2ffdd-4b67-4e38-805a-0bc97f63a404","block_type":"box","text":"resulting in a delay during which a Fund may be denied certain of its rights as an investor, including","page_number":135,"box":{"x":117,"y":134,"width":742,"height":12}},{"id":"7da4058c-e1c9-4f1c-9a42-afae291ee8dd","block_type":"box","text":"rights as to dividends or to be made aware of certain corporate actions. There also may be instances","page_number":135,"box":{"x":117,"y":149,"width":753,"height":12}},{"id":"42d7f35b-3066-4ee0-be91-572bcc8d0bc1","block_type":"box","text":"where a Fund places a purchase order but is subsequently informed, at the time of re-registration, that","page_number":135,"box":{"x":116,"y":165,"width":764,"height":12}},{"id":"638fcb83-9d59-4b89-9634-85b03a69be59","block_type":"box","text":"the permissible allocation of the investment to foreign investors has been filled, depriving the Fund of","page_number":135,"box":{"x":116,"y":180,"width":754,"height":12}},{"id":"23734f2f-2322-42ff-aa33-929a1aa0826d","block_type":"box","text":"the ability to make its desired investment at that time.","page_number":135,"box":{"x":116,"y":196,"width":400,"height":12}},{"id":"1d1f22cc-b0cc-4fd8-91e3-b2c76e599726","block_type":"box","text":"Substantial limitations may exist in certain countries with respect to a Fund’s ability to repatriate","page_number":135,"box":{"x":116,"y":227,"width":714,"height":12}},{"id":"4459ec67-12b1-4770-bc6a-cc6cf19243c9","block_type":"box","text":"investment income, capital or the proceeds of sales of securities by foreign investors. A Fund could be","page_number":135,"box":{"x":117,"y":242,"width":763,"height":12}},{"id":"35f50e42-3c7e-4e09-abd8-c81f931061d5","block_type":"box","text":"adversely affected by delays in, or a refusal to grant, any required governmental approval for","page_number":135,"box":{"x":116,"y":258,"width":693,"height":12}},{"id":"74764196-e969-4455-9858-0547936aec7b","block_type":"box","text":"repatriation of capital, as well as by the application to the Fund of any restrictions on investments. It is","page_number":135,"box":{"x":117,"y":273,"width":759,"height":12}},{"id":"cde449e4-873e-4a23-8ea5-677d9500f02a","block_type":"box","text":"possible that certain countries may impose currency controls or other restrictions relating to their","page_number":135,"box":{"x":117,"y":289,"width":719,"height":12}},{"id":"02f9eea4-2ce1-4cc8-9a93-cbda940cd5af","block_type":"box","text":"currencies or to securities of issuers in those countries. To the extent that such restrictions have the","page_number":135,"box":{"x":116,"y":304,"width":746,"height":10}},{"id":"4ed48f44-d1c0-417a-b235-6fd00a3634b2","block_type":"box","text":"effect of making certain investments illiquid, securities may not be available for sale to meet","page_number":135,"box":{"x":116,"y":320,"width":685,"height":12}},{"id":"d51c8180-9220-4f7b-bc39-d01f2552fde1","block_type":"box","text":"redemptions. Depending on a variety of financial factors, the percentage of a Fund’s portfolio subject to","page_number":135,"box":{"x":117,"y":335,"width":770,"height":12}},{"id":"6760d25e-d48a-417f-afd1-b6531d9642ee","block_type":"box","text":"currency controls may increase. In the event other countries impose similar controls, the portion of the","page_number":135,"box":{"x":116,"y":351,"width":763,"height":12}},{"id":"7c73832b-fc6e-41c6-badc-303a2dfc1d61","block_type":"box","text":"Fund’s assets that may be used to meet redemptions may be further decreased. Even where there is","page_number":135,"box":{"x":117,"y":366,"width":754,"height":12}},{"id":"5e0d6286-f370-45d2-97fa-0f2353903713","block_type":"box","text":"no outright restriction on repatriation of capital, the mechanics of repatriation may affect certain aspects","page_number":135,"box":{"x":117,"y":382,"width":771,"height":12}},{"id":"52ee8417-e7d3-463c-a597-0ee822b7fff3","block_type":"box","text":"of the operations of a Fund (for example, if funds may be withdrawn only in certain currencies and/or","page_number":135,"box":{"x":116,"y":397,"width":751,"height":12}},{"id":"07a5be74-fd70-4532-8cd1-f8635888e0d8","block_type":"box","text":"only at an exchange rate established by the government).","page_number":135,"box":{"x":116,"y":413,"width":433,"height":12}},{"id":"23b0b016-04f9-456d-a9e5-2e95f36ed012","block_type":"box","text":"In certain countries, banks or other financial institutions may be among the leading companies or have","page_number":135,"box":{"x":117,"y":444,"width":763,"height":12}},{"id":"4a0599d3-5d6e-4ae7-94c9-4666e8956684","block_type":"box","text":"actively traded securities available for investment. The Investment Company Act restricts a Fund’s","page_number":135,"box":{"x":116,"y":459,"width":734,"height":12}},{"id":"d107732f-ca6f-47c1-b6b2-583a875b05a9","block_type":"box","text":"investments in any equity securities of an issuer that, in its most recent fiscal year, derived more than","page_number":135,"box":{"x":117,"y":475,"width":755,"height":12}},{"id":"c98d80ee-e4b3-488c-a18d-eb9765122275","block_type":"box","text":"15% of its revenues from “securities related activities,” as defined by the rules thereunder. These","page_number":135,"box":{"x":118,"y":490,"width":722,"height":12}},{"id":"899a17ad-9988-40ac-a184-50e94d0b079b","block_type":"box","text":"provisions may restrict a Fund’s investments in certain foreign banks and other financial institutions.","page_number":135,"box":{"x":117,"y":506,"width":744,"height":12}},{"id":"4a48b08a-caef-491f-9b85-4398334743c8","block_type":"box","text":"Political and economic structures in emerging market countries may be undergoing significant","page_number":135,"box":{"x":117,"y":537,"width":699,"height":12}},{"id":"09ad23af-1787-455e-b27c-15eb3f052cc7","block_type":"box","text":"evolution and rapid development, and these countries may lack the social, political and economic","page_number":135,"box":{"x":116,"y":552,"width":726,"height":12}},{"id":"ac6251f8-9bdf-4af4-bdc4-ccd1fbbdfe38","block_type":"box","text":"stability characteristic of more developed countries. Some of these countries may have in the past","page_number":135,"box":{"x":116,"y":568,"width":732,"height":12}},{"id":"af80fa1e-8eb6-4a33-987f-f3f5e941d19c","block_type":"box","text":"failed to recognize private property rights and have at times nationalized or expropriated the assets of","page_number":135,"box":{"x":116,"y":583,"width":759,"height":12}},{"id":"1bb26581-86a0-40ea-aad0-6240d23b084e","block_type":"box","text":"private companies. As a result the risks described above, including the risks of nationalization or","page_number":135,"box":{"x":117,"y":599,"width":718,"height":12}},{"id":"f90364c1-5469-4107-8ed1-e4e443d57776","block_type":"box","text":"expropriation of assets, may be heightened. In addition, unanticipated political or social developments","page_number":135,"box":{"x":116,"y":614,"width":760,"height":12}},{"id":"feb836da-8ebb-418c-b7e7-b9c91ab58944","block_type":"box","text":"may affect the value of investments in these countries and the availability to a Fund of additional","page_number":135,"box":{"x":117,"y":630,"width":718,"height":12}},{"id":"ac6773fa-a29a-49c5-8d78-df4fd631fa6f","block_type":"box","text":"investments in emerging market countries. The small size and inexperience of the securities markets in","page_number":135,"box":{"x":117,"y":645,"width":770,"height":12}},{"id":"c39ee403-2cf2-4b38-8f33-296726522498","block_type":"box","text":"certain of these countries and the limited volume of trading in securities in these countries may make","page_number":135,"box":{"x":116,"y":661,"width":748,"height":12}},{"id":"42bd626c-4647-49af-bf99-71bca87c49a1","block_type":"box","text":"investments in the countries illiquid and more volatile than investments in Japan or most Western","page_number":135,"box":{"x":117,"y":676,"width":719,"height":12}},{"id":"d199b13e-f5b4-4043-8d13-48e708fb25ee","block_type":"box","text":"European countries. There may be little financial or accounting information available with respect to","page_number":135,"box":{"x":117,"y":692,"width":736,"height":12}},{"id":"aed70a16-9ab1-44fe-acab-ed0138816fa1","block_type":"box","text":"issuers located in certain emerging market countries, and it may be difficult to assess the value or","page_number":135,"box":{"x":117,"y":707,"width":724,"height":12}},{"id":"9088b1c7-b8f1-4295-af5b-6fce94affad3","block_type":"box","text":"prospects of an investment in such issuers.","page_number":135,"box":{"x":117,"y":723,"width":319,"height":12}},{"id":"a8049e93-47c2-4c0f-a4d3-2cb17c2cf677","block_type":"box","text":"The expense ratios of the Funds investing significantly in foreign securities can be expected to be","page_number":135,"box":{"x":116,"y":754,"width":723,"height":12}},{"id":"5f9beca5-d5a5-4371-893b-f7850033039c","block_type":"box","text":"higher than those of Funds investing primarily in domestic securities. The costs attributable to investing","page_number":135,"box":{"x":117,"y":769,"width":763,"height":12}},{"id":"9f25defe-ef37-4454-8970-9b8f8ee2f58c","block_type":"box","text":"abroad are usually higher for several reasons, such as the higher cost of custody of foreign securities,","page_number":135,"box":{"x":116,"y":785,"width":755,"height":12}},{"id":"f37819e1-7160-46b8-81ac-c039b9866ecc","block_type":"box","text":"higher commissions paid on comparable transactions on foreign markets and additional costs arising","page_number":135,"box":{"x":117,"y":800,"width":746,"height":12}},{"id":"26348c62-7a2b-4c67-8802-0f1c25564da8","block_type":"box","text":"from delays in settlements of transactions involving foreign securities.","page_number":135,"box":{"x":116,"y":816,"width":515,"height":12}},{"id":"1e1ae49c-4a87-40cb-a5aa-c059942580fa","block_type":"box","text":"Risks of Investments in Russia.","page_number":135,"box":{"x":116,"y":847,"width":232,"height":9}},{"id":"312530c0-c783-4f3b-80d7-dcf2a8b163c4","block_type":"box","text":"A Fund may invest a portion of its assets in securities issued by","page_number":135,"box":{"x":350,"y":847,"width":482,"height":12}},{"id":"1b406574-2044-44a8-b25a-b04dec30130d","block_type":"box","text":"companies located in Russia. The Russian securities market suffers from a variety of problems","page_number":135,"box":{"x":116,"y":862,"width":709,"height":12}},{"id":"a654d1ff-f598-49fd-8140-1d60b1139a16","block_type":"box","text":"described above in “Investment in Emerging Markets” not encountered in more developed markets.","page_number":135,"box":{"x":116,"y":878,"width":742,"height":12}},{"id":"17a49e8b-cabb-4de3-8bb4-a69405aeeb06","block_type":"box","text":"II-48","page_number":135,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"9fdf0526-2615-4c0e-8b3b-ac0c83982b9b","block_type":"box","text":"NM1026U-6004382-135/605","page_number":135,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3bf33065-33bc-4c23-b928-de7379abe3fb","block_type":"box","text":"The Russian securities market is relatively new, and a substantial portion of securities transactions in","page_number":136,"box":{"x":116,"y":87,"width":755,"height":12}},{"id":"a7d3ff5d-74e8-4630-b438-64e6dcb2df9a","block_type":"box","text":"Russia are privately negotiated outside of stock exchanges. The inexperience of the Russian securities","page_number":136,"box":{"x":117,"y":102,"width":769,"height":13}},{"id":"c994835c-ff51-4e17-b187-870a187ba808","block_type":"box","text":"market and the limited volume of trading in securities in the market may make obtaining accurate","page_number":136,"box":{"x":117,"y":118,"width":723,"height":12}},{"id":"f6ca4828-feb7-4a89-90e6-4d71fe7c290c","block_type":"box","text":"prices on portfolio securities from independent sources more difficult than in more developed markets.","page_number":136,"box":{"x":117,"y":134,"width":761,"height":11}},{"id":"5a9df4eb-9c01-42b6-9359-50f634649333","block_type":"box","text":"Because of the underdeveloped state of Russia’s securities markets and banking and","page_number":136,"box":{"x":117,"y":165,"width":639,"height":12}},{"id":"aa4bf23b-13fb-4e27-8639-8dcf8589242e","block_type":"box","text":"telecommunication systems, settlement, clearing and registration of securities transactions are subject","page_number":136,"box":{"x":116,"y":180,"width":764,"height":12}},{"id":"4b3f6a26-3b08-49b0-b6ab-2e02eac603a4","block_type":"box","text":"to additional risks. Prior to 2013, there was no central registration system for equity share registration","page_number":136,"box":{"x":116,"y":196,"width":756,"height":12}},{"id":"623eb4d4-cc33-42df-99ce-62951b5f67cb","block_type":"box","text":"in Russia and registration was carried out either by the issuers themselves or by registrars located","page_number":136,"box":{"x":117,"y":211,"width":733,"height":12}},{"id":"9b786abc-9393-4192-90bb-f898a33bdc95","block_type":"box","text":"throughout Russia. These registrars may not have been subject to effective state supervision or","page_number":136,"box":{"x":116,"y":227,"width":715,"height":12}},{"id":"a3126813-f7b6-4bcf-acff-5892adc8314e","block_type":"box","text":"licensed with any governmental entity. In 2013, Russia established the National Settlement Depository","page_number":136,"box":{"x":117,"y":242,"width":764,"height":12}},{"id":"5806052f-f742-4fda-9acb-8d73b1a6f3c6","block_type":"box","text":"(“NSD”) as a recognized central securities depository, and title to Russian equities held through the","page_number":136,"box":{"x":117,"y":258,"width":740,"height":12}},{"id":"4a065f99-2a3b-4c5b-8933-54b137d81dc4","block_type":"box","text":"NSD is now based on the records of the NSD and not on the records of the local registrars. Although","page_number":136,"box":{"x":117,"y":273,"width":751,"height":12}},{"id":"3b466b76-4ee9-412b-beba-3589742330ab","block_type":"box","text":"the implementation of the NSD has enhanced the efficiency and transparency of the Russian securities","page_number":136,"box":{"x":116,"y":289,"width":770,"height":12}},{"id":"29c57cdd-c668-465d-9beb-5525946b9609","block_type":"box","text":"market, loss still can occur. Additionally, issuers and registrars remain prominent in the validation and","page_number":136,"box":{"x":117,"y":304,"width":757,"height":12}},{"id":"3d54de78-1109-4501-ad57-d11603b82314","block_type":"box","text":"approval of documentation requirements for corporate action processing in Russia, and, because the","page_number":136,"box":{"x":116,"y":320,"width":754,"height":12}},{"id":"29e20cca-6d19-4ef8-8a53-6effedde1fb0","block_type":"box","text":"documentation requirements and approval criteria vary between registrars and issuers, there remain","page_number":136,"box":{"x":116,"y":335,"width":749,"height":12}},{"id":"16e5a11d-34be-4e0d-9697-d48cefd99be8","block_type":"box","text":"inconsistent market standards in the Russian market with respect to the completion and submission of","page_number":136,"box":{"x":117,"y":351,"width":762,"height":12}},{"id":"9ff858ef-e3e7-488f-ba0a-876832b997fc","block_type":"box","text":"corporate action elections. To the extent that a Fund suffers a loss relating to title or corporate actions","page_number":136,"box":{"x":116,"y":366,"width":761,"height":12}},{"id":"fd20d5cd-dfde-4567-835f-9fb196454c0c","block_type":"box","text":"relating to its portfolio securities, it may be difficult for the Fund to enforce its rights or otherwise","page_number":136,"box":{"x":117,"y":382,"width":713,"height":12}},{"id":"e7092e21-1ba1-4c9e-8198-670e16de79ac","block_type":"box","text":"remedy the loss. Russian securities laws may not recognize foreign nominee accounts held with a","page_number":136,"box":{"x":117,"y":397,"width":731,"height":12}},{"id":"82fb3e23-e4c4-4b59-b2be-311754e66f65","block_type":"box","text":"custodian bank, and as a result the custodian may be considered the ultimate owner of securities held","page_number":136,"box":{"x":116,"y":413,"width":762,"height":12}},{"id":"a2998a59-4112-4f10-84a2-4a37a73ed42a","block_type":"box","text":"on behalf of their clients. A Fund also may experience difficulty in obtaining and/or enforcing judgments","page_number":136,"box":{"x":116,"y":428,"width":770,"height":12}},{"id":"6a922c50-eb4f-463d-8743-0d74993c4d44","block_type":"box","text":"in Russia.","page_number":136,"box":{"x":117,"y":444,"width":77,"height":9}},{"id":"42af9060-7b0e-4f03-84a3-b7d1676c59b7","block_type":"box","text":"In addition, Russia continues to assert its influence in the region through economic and military","page_number":136,"box":{"x":117,"y":475,"width":708,"height":12}},{"id":"80c507bf-2058-4036-8734-4998cb15a2b4","block_type":"box","text":"measures, as it did with Georgia in the summer of 2008 and the Ukraine in 2014 and 2022. Russia","page_number":136,"box":{"x":117,"y":490,"width":735,"height":12}},{"id":"db2aa79d-4b07-43c8-9fa9-b775642e712d","block_type":"box","text":"launched a large-scale invasion of Ukraine on February 24, 2022. The extent and duration of the","page_number":136,"box":{"x":117,"y":506,"width":720,"height":12}},{"id":"953bc67c-b165-4472-90f4-1841a8fa3f6c","block_type":"box","text":"military action, resulting sanctions and resulting future market disruptions, including declines in its","page_number":136,"box":{"x":117,"y":521,"width":727,"height":12}},{"id":"5af32c22-ef3b-4cd9-96ec-aca8df13d338","block_type":"box","text":"stock markets and the value of the ruble against the U.S. dollar, are impossible to predict. Any such","page_number":136,"box":{"x":116,"y":537,"width":744,"height":12}},{"id":"9ea8732e-55a5-4f1f-b9ec-614b46cd4e1c","block_type":"box","text":"disruptions caused by Russian military action or other actions (including cyberattacks and espionage)","page_number":136,"box":{"x":116,"y":552,"width":757,"height":12}},{"id":"9a77594a-cf25-4193-b95e-fd9cc67b13a5","block_type":"box","text":"or resulting actual and threatened responses to such activity, including purchasing and financing","page_number":136,"box":{"x":116,"y":568,"width":720,"height":12}},{"id":"4810c0e1-6cda-4874-8f65-26487cda514e","block_type":"box","text":"restrictions, boycotts or changes in consumer or purchaser preferences, sanctions, tariffs or","page_number":136,"box":{"x":117,"y":583,"width":685,"height":12}},{"id":"31585902-8179-494e-818e-d8dd1e56f429","block_type":"box","text":"cyberattacks on the Russian government, Russian companies or Russian individuals, including","page_number":136,"box":{"x":116,"y":599,"width":710,"height":12}},{"id":"f2a3fe8b-40cd-45fc-9b0b-fec0244b25dc","block_type":"box","text":"politicians, may impact Russia’s economy and Russian issuers of securities in which the Fund invests.","page_number":136,"box":{"x":117,"y":614,"width":763,"height":12}},{"id":"c1cab14a-26ca-41f3-9024-d284d5812211","block_type":"box","text":"Actual and threatened responses to such activity, including purchasing restrictions, sanctions, tariffs or","page_number":136,"box":{"x":116,"y":630,"width":766,"height":12}},{"id":"173aeb4a-7b7c-49ed-b80b-77527e60ae2e","block_type":"box","text":"cyberattacks on the Russian government or Russian companies, may impact Russia’s economy and","page_number":136,"box":{"x":116,"y":645,"width":750,"height":12}},{"id":"5472b257-8111-44f8-9cf5-ca215c491733","block_type":"box","text":"Russian issuers of securities in which the Fund invests. Actual and threatened responses to such","page_number":136,"box":{"x":117,"y":661,"width":720,"height":12}},{"id":"077b5316-e6f9-4f24-ade1-f7c6229048de","block_type":"box","text":"military action may also impact the markets for certain Russian commodities, such as oil and natural","page_number":136,"box":{"x":117,"y":676,"width":741,"height":12}},{"id":"ce210028-1c07-46b7-b664-eb59207fedf7","block_type":"box","text":"gas, as well as other sectors of the Russian economy, and may likely have collateral impacts on such","page_number":136,"box":{"x":116,"y":692,"width":752,"height":12}},{"id":"65279466-dad0-4f28-83fa-de166bfcaa4e","block_type":"box","text":"sectors globally.","page_number":136,"box":{"x":116,"y":707,"width":119,"height":12}},{"id":"08b35e9e-e85f-4783-b605-3d717c79a815","block_type":"box","text":"Governments in the United States and many other countries (collectively, the “Sanctioning Bodies”)","page_number":136,"box":{"x":117,"y":738,"width":735,"height":12}},{"id":"adac10d1-ca4a-4138-9a5f-233ce431477f","block_type":"box","text":"have imposed economic sanctions, which can consist of prohibiting certain securities trades, certain","page_number":136,"box":{"x":117,"y":754,"width":739,"height":12}},{"id":"17a48fb6-e8cc-455d-974a-ef1ce6c042ac","block_type":"box","text":"private transactions in the energy sector, asset freezes and prohibition of all business, against certain","page_number":136,"box":{"x":117,"y":769,"width":751,"height":12}},{"id":"72c114b3-d232-4725-a287-5bb2e994b84d","block_type":"box","text":"Russian individuals, including politicians, and Russian corporate and banking entities. The Sanctioning","page_number":136,"box":{"x":117,"y":785,"width":760,"height":12}},{"id":"e2502505-acf0-44fa-a7b3-71ed18966677","block_type":"box","text":"Bodies, or others, could also institute broader sanctions on Russia, including banning Russia from","page_number":136,"box":{"x":117,"y":800,"width":725,"height":12}},{"id":"973f89b5-e194-4844-9072-aed0b44a4794","block_type":"box","text":"global payments systems that facilitate cross-border payments. These sanctions, or even the threat of","page_number":136,"box":{"x":116,"y":816,"width":758,"height":12}},{"id":"1a1c6093-2de5-47d4-aef0-e2d8db5e35af","block_type":"box","text":"further sanctions, may result in the decline of the value and liquidity of Russian securities, a weakening","page_number":136,"box":{"x":116,"y":831,"width":769,"height":12}},{"id":"14359533-3b4e-48d9-9a24-ee7252ebd37c","block_type":"box","text":"of the ruble or other adverse consequences to the Russian economy. These sanctions have resulted","page_number":136,"box":{"x":116,"y":847,"width":752,"height":12}},{"id":"2905b4cd-2aea-46d5-ad4a-5d0a279243e8","block_type":"box","text":"and may continue to result in the immediate freeze of Russian securities and/or funds invested in","page_number":136,"box":{"x":116,"y":862,"width":725,"height":12}},{"id":"3b5493b4-861b-4069-aaf6-d5cf388014c0","block_type":"box","text":"prohibited assets, impairing the ability of a Fund to buy, sell, receive or deliver those securities and/or","page_number":136,"box":{"x":117,"y":878,"width":757,"height":12}},{"id":"0d24b705-ba24-43d8-98f7-d12993858c2b","block_type":"box","text":"II-49","page_number":136,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"da78c51c-60f3-4f5e-8be7-ea079c5bd93b","block_type":"box","text":"NM1026U-6004382-136/605","page_number":136,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"fc10d539-1114-4ee1-90fd-d7fd46fa67b0","block_type":"box","text":"assets. Sanctions could also result in Russia taking counter measures or retaliatory actions which may","page_number":137,"box":{"x":116,"y":87,"width":766,"height":12}},{"id":"6dc7df15-8a28-44ab-a6d2-b134b243e482","block_type":"box","text":"further impair the value and liquidity of Russian securities.","page_number":137,"box":{"x":116,"y":102,"width":435,"height":13}},{"id":"7f5f4e70-3628-4575-b1e2-04b26541fb14","block_type":"box","text":"Risks of Investing in Saudi Arabia.","page_number":137,"box":{"x":116,"y":134,"width":253,"height":12}},{"id":"294da57d-858d-4443-8aa3-cefe7fc981f0","block_type":"box","text":"The ability of foreign investors (such as a Fund) to invest in Saudi","page_number":137,"box":{"x":371,"y":134,"width":497,"height":12}},{"id":"f4715aa6-97cc-49db-a2a5-56d39982931c","block_type":"box","text":"Arabian issuers is new and untested. Such ability could be restricted or revoked by the Saudi Arabian","page_number":137,"box":{"x":116,"y":149,"width":757,"height":12}},{"id":"60eeb728-dd26-4171-9ee7-607ae770e7ab","block_type":"box","text":"government at any time, and unforeseen risks could materialize due to foreign ownership in such","page_number":137,"box":{"x":116,"y":165,"width":724,"height":12}},{"id":"672cd089-86f2-4b0e-85cd-1c5c051843dc","block_type":"box","text":"securities. In addition, the Capital Market Authority (“CMA”) places investment limitations on the","page_number":137,"box":{"x":116,"y":180,"width":715,"height":12}},{"id":"8a8d52c0-e8db-4144-8d00-181489f16f98","block_type":"box","text":"ownership of Saudi Arabian issuers by foreign investors, including a limitation on a Fund’s ownership","page_number":137,"box":{"x":116,"y":196,"width":753,"height":12}},{"id":"933e00c4-6208-4be1-ab7d-537f0d062893","block_type":"box","text":"of any single issuer listed on the Saudi Arabian Stock Exchange, which may prevent a Fund from","page_number":137,"box":{"x":116,"y":211,"width":726,"height":12}},{"id":"f576f478-8a33-4154-8f5d-3776e1b0e4ed","block_type":"box","text":"investing in accordance with its strategy and contribute to tracking error against the Underlying Index.","page_number":137,"box":{"x":117,"y":227,"width":757,"height":12}},{"id":"a56337f0-53af-4c32-ac3c-f5b4e384705b","block_type":"box","text":"These restrictions may be changed or new restrictions, such as licensing requirements, special","page_number":137,"box":{"x":116,"y":242,"width":710,"height":12}},{"id":"e48fd3c3-9f58-46bc-8adf-d8117f05eaf5","block_type":"box","text":"approvals or additional foreign taxes, may be instituted at any time. A Fund may not be able to obtain","page_number":137,"box":{"x":116,"y":258,"width":756,"height":12}},{"id":"c4139588-7191-45b0-bbd6-ca2481472fa6","block_type":"box","text":"or maintain any such licenses or approvals and may not be able to buy and sell securities at full value.","page_number":137,"box":{"x":116,"y":273,"width":763,"height":12}},{"id":"f0e56512-702d-4256-9707-90d64ad2698e","block_type":"box","text":"Major disruptions or regulatory changes could occur in the Saudi Arabian market, any of which could","page_number":137,"box":{"x":117,"y":289,"width":750,"height":12}},{"id":"c2c5061e-929d-4676-9ced-7ca62fcfdd86","block_type":"box","text":"negatively impact a Fund. These risks may be exacerbated, compared to more developed markets,","page_number":137,"box":{"x":117,"y":304,"width":741,"height":12}},{"id":"1119b118-2464-45b0-b469-093a2e260393","block_type":"box","text":"given the limited history of foreign investment in the Saudi Arabian market. Investments in","page_number":137,"box":{"x":116,"y":320,"width":672,"height":12}},{"id":"729cfb0d-e807-40c8-b78e-acf21e77b8c4","block_type":"box","text":"Saudi Arabia may also be subject to loss due to expropriation or nationalization of assets and property","page_number":137,"box":{"x":116,"y":335,"width":764,"height":12}},{"id":"e3eafd0a-dba9-44d3-9026-19d93e4ba0a3","block_type":"box","text":"or the imposition of restrictions on additional foreign investments and repatriation of capital. Such","page_number":137,"box":{"x":116,"y":351,"width":725,"height":12}},{"id":"e299ae53-588a-4794-a0bf-aca9a1cf80ce","block_type":"box","text":"heightened risks may include, among others, restrictions on and government intervention in","page_number":137,"box":{"x":117,"y":366,"width":683,"height":12}},{"id":"37fdce9e-413b-40f5-b403-dd6ba17da334","block_type":"box","text":"international trade, confiscatory taxation, political instability, including authoritarian and/or military","page_number":137,"box":{"x":117,"y":382,"width":724,"height":12}},{"id":"6d59f56d-21ee-4fdb-9ca6-174b56dd067e","block_type":"box","text":"involvement in governmental decision making, armed conflict, crime and instability as a result of","page_number":137,"box":{"x":117,"y":397,"width":715,"height":12}},{"id":"eb156e55-62a8-4213-b8f5-2f223b08875c","block_type":"box","text":"religious, ethnic and/or socioeconomic unrest. Saudi Arabia has privatized, or has begun the process","page_number":137,"box":{"x":117,"y":413,"width":754,"height":12}},{"id":"4eb16077-9fb0-4744-b18d-63733277abaf","block_type":"box","text":"of privatizing, certain entities and industries. Newly privatized companies may face strong competition","page_number":137,"box":{"x":116,"y":428,"width":759,"height":12}},{"id":"ac3b75f7-4388-4496-8102-824be8e2c01a","block_type":"box","text":"from government-sponsored competitors that have not been privatized. In some instances, investors in","page_number":137,"box":{"x":116,"y":444,"width":768,"height":12}},{"id":"a03f24d9-3736-4b12-b5c7-0ffd87c0e2cc","block_type":"box","text":"newly privatized entities have suffered losses due to the inability of the newly privatized entities to","page_number":137,"box":{"x":117,"y":459,"width":728,"height":12}},{"id":"fd39ed8f-e321-49a3-848d-7f7013978da9","block_type":"box","text":"adjust quickly to a competitive environment or changing regulatory and legal standards or, in some","page_number":137,"box":{"x":116,"y":475,"width":737,"height":12}},{"id":"4f96f197-7375-42d4-921f-31ebc176f7e1","block_type":"box","text":"cases, due to re-nationalization of such privatized entities. There is no assurance that similar losses","page_number":137,"box":{"x":116,"y":490,"width":745,"height":12}},{"id":"139756df-6225-47ab-83a9-f250b8279407","block_type":"box","text":"will not recur. Further, under income tax laws imposed by the Department of Zakat and Income Tax,","page_number":137,"box":{"x":116,"y":506,"width":747,"height":12}},{"id":"1f6dc494-02c9-41e1-8dc3-56c21203e1d0","block_type":"box","text":"dividends paid by a Saudi Arabian company to foreign stockholders are generally subject to a 5%","page_number":137,"box":{"x":116,"y":521,"width":727,"height":12}},{"id":"e41f9c68-6fdb-41fd-9e33-8826cece7755","block_type":"box","text":"withholding tax (different tax rates may apply pursuant to an applicable treaty). Saudi Arabia is highly","page_number":137,"box":{"x":116,"y":537,"width":754,"height":12}},{"id":"bad91c05-80fa-4807-b4fe-9848a3babca7","block_type":"box","text":"reliant on income from the sale of petroleum and trade with other countries involved in the sale of","page_number":137,"box":{"x":117,"y":552,"width":725,"height":12}},{"id":"979453c8-cbf1-4571-891c-ef725a299690","block_type":"box","text":"petroleum, and its economy is therefore vulnerable to changes in foreign currency values and the","page_number":137,"box":{"x":117,"y":568,"width":726,"height":12}},{"id":"14a907b0-d073-43d3-8b17-7f1bb25eca9d","block_type":"box","text":"market for petroleum. As global demand for petroleum fluctuates, Saudi Arabia may be significantly","page_number":137,"box":{"x":117,"y":583,"width":741,"height":12}},{"id":"d018aa3d-027c-4c93-a967-150220b2f491","block_type":"box","text":"impacted.","page_number":137,"box":{"x":117,"y":599,"width":76,"height":12}},{"id":"d5ae53a3-54a7-456f-8540-66ff6374623d","block_type":"box","text":"Like most Middle Eastern governments, the government of Saudi Arabia exercises substantial","page_number":137,"box":{"x":117,"y":630,"width":701,"height":12}},{"id":"e671d9a8-bff7-4653-ba55-55d540f96ba4","block_type":"box","text":"influence over many aspects of the private sector. Although liberalization in the wider economy is","page_number":137,"box":{"x":117,"y":645,"width":724,"height":12}},{"id":"958c8af4-1405-4c8c-8470-942700adeb78","block_type":"box","text":"underway, in many areas it has lagged significantly: restrictions on foreign ownership persist, and the","page_number":137,"box":{"x":117,"y":661,"width":749,"height":12}},{"id":"e8a21c9c-efcb-4f3c-8e20-194c68036143","block_type":"box","text":"government has an ownership stake in many key industries. The situation is exacerbated by the fact","page_number":137,"box":{"x":116,"y":676,"width":743,"height":12}},{"id":"71f6b4c4-0cc7-430f-9056-fa0fdf9c8b1f","block_type":"box","text":"that Saudi Arabia is governed by an absolute monarchy. Saudi Arabia has historically experienced","page_number":137,"box":{"x":116,"y":692,"width":729,"height":12}},{"id":"9cf10db1-0806-4f3f-bc16-231d8ec18e53","block_type":"box","text":"strained relations with economic partners worldwide, including other countries in the Middle East due to","page_number":137,"box":{"x":116,"y":707,"width":766,"height":12}},{"id":"2955def8-d016-4e11-b1b5-94a20e54374b","block_type":"box","text":"geopolitical events. Incidents involving a Middle Eastern country’s or the region’s security, including","page_number":137,"box":{"x":116,"y":723,"width":737,"height":12}},{"id":"f8225048-58a5-426b-abb5-097f85fa87e2","block_type":"box","text":"terrorism, may cause uncertainty in their markets and may adversely affect its economy and a Fund’s","page_number":137,"box":{"x":116,"y":738,"width":752,"height":12}},{"id":"213db8f9-a309-4c06-8cc2-0673ee97f597","block_type":"box","text":"investments. Governmental actions in the future could have a significant effect on economic conditions","page_number":137,"box":{"x":117,"y":754,"width":761,"height":12}},{"id":"d904480a-88b6-4295-8707-71d899fed729","block_type":"box","text":"in Saudi Arabia, which could affect private sector companies and a Fund, as well as the value of","page_number":137,"box":{"x":117,"y":769,"width":713,"height":12}},{"id":"69d530c5-fdd0-49e6-a69f-457c5f56b0e2","block_type":"box","text":"securities in a Fund’s portfolio. Any economic sanctions on Saudi Arabian individuals or Saudi Arabian","page_number":137,"box":{"x":116,"y":785,"width":759,"height":12}},{"id":"9213f74f-46ed-4bc0-9755-cd3d201f012c","block_type":"box","text":"corporate entities, or even the threat of sanctions, may result in the decline of the value and liquidity of","page_number":137,"box":{"x":116,"y":800,"width":760,"height":12}},{"id":"3f02bf03-e9b4-4c62-a93f-669951ad0c17","block_type":"box","text":"Saudi Arabian securities, a weakening of the Saudi riyal or other adverse consequences to the Saudi","page_number":137,"box":{"x":116,"y":816,"width":749,"height":12}},{"id":"e6bc1f10-4641-4938-906b-0381206840b3","block_type":"box","text":"Arabian economy. In addition, Saudi Arabia’s economy relies heavily on cheap, foreign labor, and","page_number":137,"box":{"x":116,"y":831,"width":729,"height":12}},{"id":"bf003a6d-a0e4-4185-940c-1bcd5c4e1718","block_type":"box","text":"changes in the availability of this labor supply could have an adverse effect on the economy.","page_number":137,"box":{"x":116,"y":847,"width":690,"height":12}},{"id":"2cd37ef1-0236-49c9-9ffa-7dfe12c45441","block_type":"box","text":"II-50","page_number":137,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"7f25cc6b-c201-4008-bfbf-063ceb695eba","block_type":"box","text":"NM1026U-6004382-137/605","page_number":137,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"39cc9a10-b4e0-4c4a-9d21-35d57f80e59d","block_type":"box","text":"The securities markets in Saudi Arabia may not be as developed as those in other countries. As a","page_number":138,"box":{"x":116,"y":87,"width":730,"height":12}},{"id":"155026aa-d4f4-4243-b6c3-c25bdd488b59","block_type":"box","text":"result, securities markets in Saudi Arabia are subject to greater risks associated with market volatility,","page_number":138,"box":{"x":117,"y":102,"width":757,"height":13}},{"id":"b9fae2d5-5132-43ab-9d22-3d7546edc3fc","block_type":"box","text":"lower market capitalization, lower trading volume, illiquidity, inflation, greater price fluctuations,","page_number":138,"box":{"x":117,"y":118,"width":705,"height":12}},{"id":"52f6c372-52e1-4841-a830-f32b9959e2af","block_type":"box","text":"uncertainty regarding the existence of trading markets, governmental control and heavy regulation of","page_number":138,"box":{"x":117,"y":134,"width":751,"height":12}},{"id":"1a81f78f-c720-4880-bcb0-c9beba170bdb","block_type":"box","text":"labor and industry. Shares of certain Saudi Arabian companies tend to trade less frequently than those","page_number":138,"box":{"x":117,"y":149,"width":766,"height":12}},{"id":"ec502236-c2c8-498e-992c-799966956116","block_type":"box","text":"of companies on exchanges in more developed markets. Such infrequent trading may adversely affect","page_number":138,"box":{"x":116,"y":165,"width":764,"height":12}},{"id":"cbd0c76d-cc8b-49b6-9729-11e2a160e512","block_type":"box","text":"the pricing of these securities and a Fund’s ability to sell these securities in the future. Current","page_number":138,"box":{"x":116,"y":180,"width":701,"height":12}},{"id":"2e49dff2-8952-41cc-a0d5-c9533718c204","block_type":"box","text":"regulations in Saudi Arabian markets may require a Fund to execute trades of securities through a","page_number":138,"box":{"x":117,"y":196,"width":733,"height":12}},{"id":"38ec7a6a-d6c8-48eb-bc1a-8caf87fbe025","block_type":"box","text":"single broker. As a result, the Manager will have less flexibility to choose among brokers on behalf of a","page_number":138,"box":{"x":116,"y":211,"width":767,"height":12}},{"id":"08cc6c6a-e404-42e8-8ac5-7b7181453ba8","block_type":"box","text":"Fund than is typically the case for investment managers.","page_number":138,"box":{"x":117,"y":227,"width":424,"height":12}},{"id":"5dda22cf-7bb8-4bf5-8cfc-a954b91dbf0c","block_type":"box","text":"Although the political situation in Saudi Arabia is largely stable, Saudi Arabia has historically","page_number":138,"box":{"x":116,"y":258,"width":687,"height":12}},{"id":"4aa89ea4-7bea-4662-a9e9-01850434da0c","block_type":"box","text":"experienced political instability, and there remains the possibility that the stability will not hold in the","page_number":138,"box":{"x":116,"y":273,"width":741,"height":12}},{"id":"e9280b0d-2a5e-4734-a38a-4c358986d7a8","block_type":"box","text":"future or that instability in the larger Middle East region could adversely impact the economy of Saudi","page_number":138,"box":{"x":116,"y":289,"width":755,"height":12}},{"id":"7bfaba90-cd4e-41fa-9536-ce48d31a9695","block_type":"box","text":"Arabia. Instability may be caused by military developments, government interventions in the","page_number":138,"box":{"x":116,"y":304,"width":686,"height":12}},{"id":"f279ada8-b9dc-4e6a-94de-bfa5565d1729","block_type":"box","text":"marketplace, terrorism, extremist attitudes, attempted social or political reforms, religious differences,","page_number":138,"box":{"x":117,"y":320,"width":755,"height":12}},{"id":"e5350bf3-f2f7-4754-bc9e-dfdec5e8abaa","block_type":"box","text":"or other factors. Additionally, anti-Western views held by certain groups in the Middle East may","page_number":138,"box":{"x":116,"y":335,"width":710,"height":12}},{"id":"890c6014-588a-4d3f-a268-f59f752d96e1","block_type":"box","text":"influence government policies regarding foreign investment. Further developments in U.S. relations","page_number":138,"box":{"x":117,"y":351,"width":740,"height":12}},{"id":"6c3c1f2c-0d88-491e-82af-32a07a8fc577","block_type":"box","text":"with Saudi Arabia and other Middle-Eastern countries may affect these attitudes and policies. The U.S.","page_number":138,"box":{"x":116,"y":366,"width":768,"height":12}},{"id":"fcde718b-c0bd-4c0b-8b59-7e5108117fa5","block_type":"box","text":"is a significant, and in some cases the most significant, trading partner of, or foreign investor in, Saudi","page_number":138,"box":{"x":117,"y":382,"width":760,"height":12}},{"id":"2739cb90-8088-45ed-b8d5-124671e16b95","block_type":"box","text":"Arabia. As a result, economic conditions of Saudi Arabia may be particularly affected by changes in the","page_number":138,"box":{"x":116,"y":397,"width":771,"height":12}},{"id":"95451aba-173e-47d4-9407-ae410f8d3595","block_type":"box","text":"U.S. economy. A decrease in U.S. imports or exports, new trade and financial regulations or tariffs,","page_number":138,"box":{"x":117,"y":413,"width":738,"height":12}},{"id":"b1af0c82-dc9a-4454-9ef0-e3c6a2d5b7ce","block_type":"box","text":"changes in the U.S. dollar exchange rate or an economic slowdown in the U.S. may have a material","page_number":138,"box":{"x":116,"y":428,"width":746,"height":12}},{"id":"d921eda6-b018-41cb-9e91-886a37c2f1b8","block_type":"box","text":"adverse effect on the economic conditions of Saudi Arabia and, as a result, securities to which the","page_number":138,"box":{"x":116,"y":444,"width":733,"height":11}},{"id":"a0a12e7b-b125-4844-9d78-b0a6ad1479ee","block_type":"box","text":"Fund has exposure. Political instability in North Africa and the larger Middle East region has caused","page_number":138,"box":{"x":117,"y":459,"width":743,"height":12}},{"id":"d4b009ef-1886-4cf2-9bf3-2366f86ebaaf","block_type":"box","text":"significant disruptions to many industries. Continued political and social unrest in these areas may","page_number":138,"box":{"x":116,"y":475,"width":732,"height":12}},{"id":"c01c1467-d040-458f-8385-05dc549273c9","block_type":"box","text":"negatively affect the value of securities in a Fund’s portfolio.","page_number":138,"box":{"x":117,"y":490,"width":449,"height":12}},{"id":"e22db28a-3709-442d-8301-ec44b2335f70","block_type":"box","text":"Certain issuers located in Saudi Arabia may operate in, or have dealings with, countries subject to","page_number":138,"box":{"x":117,"y":521,"width":731,"height":12}},{"id":"f8987aea-8b79-45f3-ae3d-49e6e4fcdc88","block_type":"box","text":"sanctions and/or embargoes imposed by the U.S. Government and the United Nations and/or countries","page_number":138,"box":{"x":116,"y":537,"width":772,"height":12}},{"id":"94068d74-e281-413c-8b4b-a7f60d24c940","block_type":"box","text":"identified by the U.S. Government as state sponsors of terrorism. As a result, an issuer may sustain","page_number":138,"box":{"x":117,"y":552,"width":744,"height":12}},{"id":"55deca21-1e90-46ea-b4b5-423f7595d55d","block_type":"box","text":"damage to its reputation if it is identified as an issuer which operates in, or has dealings with, such","page_number":138,"box":{"x":116,"y":568,"width":734,"height":12}},{"id":"d9f57418-6185-4b69-b234-1189c56a405c","block_type":"box","text":"countries. A Fund, as an investor in such issuers will be indirectly subject to those risks.","page_number":138,"box":{"x":116,"y":583,"width":655,"height":12}},{"id":"1c2a6804-de26-4701-8ce1-17a38adf25e0","block_type":"box","text":"Risks of Investing in Venezuela.","page_number":138,"box":{"x":116,"y":614,"width":237,"height":12}},{"id":"0c7f8f35-57d3-494f-9cf9-aee85c02578c","block_type":"box","text":"Investment in Venezuela may subject a Fund to legal, regulatory,","page_number":138,"box":{"x":354,"y":614,"width":493,"height":12}},{"id":"9876b6db-550f-42fa-b074-326c221941b1","block_type":"box","text":"political, currency, security, expropriation and/or nationalization of assets and economic risk specific to","page_number":138,"box":{"x":117,"y":630,"width":764,"height":12}},{"id":"e761f2f4-5882-4f7a-a5d5-14d326472c3d","block_type":"box","text":"Venezuela. Venezuela is extremely well endowed with natural resources, including oil and natural gas,","page_number":138,"box":{"x":116,"y":645,"width":765,"height":12}},{"id":"5cbed893-fcd6-4919-9e41-33ce559696c5","block_type":"box","text":"and its economy is heavily dependent on export of natural resources to key trading partners. Any act of","page_number":138,"box":{"x":116,"y":661,"width":766,"height":12}},{"id":"f698da80-c302-4efa-a6ac-54d2e5d2d067","block_type":"box","text":"terrorism, an armed conflict or a breakdown of a key trading relationship that disrupts the production or","page_number":138,"box":{"x":116,"y":676,"width":763,"height":12}},{"id":"faa36f44-fd20-466c-9763-5ae55261387c","block_type":"box","text":"export of natural resources will likely negatively affect the Venezuelan economy. The government","page_number":138,"box":{"x":116,"y":692,"width":723,"height":12}},{"id":"eed24b5e-db5a-4f90-a747-4fddc7ce946e","block_type":"box","text":"continues to control key sectors of the economy, including upstream oil and gas production, and has","page_number":138,"box":{"x":116,"y":707,"width":744,"height":12}},{"id":"d85ee3f7-9355-4673-b990-7c6d6aad0ad6","block_type":"box","text":"sought to increase its role in key sectors, such as telecommunications and steel. Meanwhile,","page_number":138,"box":{"x":116,"y":723,"width":686,"height":12}},{"id":"c35ee626-15ce-48b0-8e29-512437212f07","block_type":"box","text":"ambiguities in the investment environment remain, such as continued high levels of bureaucracy and","page_number":138,"box":{"x":116,"y":738,"width":747,"height":12}},{"id":"8153b603-cc43-47fb-b8d6-8b4923f3f16c","block_type":"box","text":"corruption, large macroeconomic imbalances, and political and policy uncertainty. Friction continues","page_number":138,"box":{"x":116,"y":754,"width":741,"height":12}},{"id":"77804088-3a7d-4a51-837b-ad8c63713265","block_type":"box","text":"between the governments of the U.S. and Venezuela. The U.S. has imposed economic sanctions,","page_number":138,"box":{"x":117,"y":769,"width":725,"height":12}},{"id":"62087655-90d8-4b9d-9dda-2d6639c5a679","block_type":"box","text":"which consist of asset freezes and sectoral sanctions, on certain Venezuelan individuals and","page_number":138,"box":{"x":116,"y":785,"width":687,"height":11}},{"id":"f5abbf9b-2738-4264-8001-29215bb5e9c8","block_type":"box","text":"Venezuelan corporate entities, and on the Venezuelan government. The U.S. could also institute","page_number":138,"box":{"x":116,"y":800,"width":717,"height":12}},{"id":"306432d8-96c8-4991-b689-69edf808c08e","block_type":"box","text":"broader sanctions on Venezuela. The U.S. has also taken military action against Venezuela in an effort","page_number":138,"box":{"x":117,"y":816,"width":764,"height":12}},{"id":"a6d191e1-5e70-41d5-b3f0-2974fdf347d5","block_type":"box","text":"to effect regime change. Military action, sanctions, or even the threat of further military action and","page_number":138,"box":{"x":116,"y":831,"width":727,"height":12}},{"id":"5a195ea0-5647-409f-9490-c7b4a144cb87","block_type":"box","text":"sanctions, may result in the decline of the value and liquidity of Venezuelan securities, a weakening of","page_number":138,"box":{"x":116,"y":847,"width":762,"height":12}},{"id":"e848ae68-7314-457b-825e-becceac903be","block_type":"box","text":"the bolivar or other adverse consequences to the Venezuelan economy. These sanctions impair the","page_number":138,"box":{"x":116,"y":862,"width":746,"height":12}},{"id":"af931263-c805-4dc8-9368-31c10af5ba3f","block_type":"box","text":"ability of a Fund to buy, sell, receive or deliver those securities and/or assets. Additional sanctions","page_number":138,"box":{"x":116,"y":878,"width":732,"height":12}},{"id":"1da97588-15a3-42a5-983b-45c78fbc4e78","block_type":"box","text":"II-51","page_number":138,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"cb5f1eff-0a90-4e87-9290-daae21494c63","block_type":"box","text":"NM1026U-6004382-138/605","page_number":138,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"feb4f7ee-9699-4ae3-b61e-ae1e8f84e5fd","block_type":"box","text":"against Venezuela may in the future be imposed by the U.S. or other countries. These factors, among","page_number":139,"box":{"x":116,"y":87,"width":761,"height":12}},{"id":"09d91646-d9b7-45db-ba09-91725aabd0ac","block_type":"box","text":"others, can have a negative impact on a Fund’s investments.","page_number":139,"box":{"x":116,"y":103,"width":457,"height":12}},{"id":"4ecd7db7-044e-4712-8e00-a78b3fd64259","block_type":"box","text":"Brady Bonds.","page_number":139,"box":{"x":116,"y":135,"width":97,"height":12}},{"id":"2f5b2dca-da8e-4272-9118-fb0cb48292d2","block_type":"box","text":"Certain Funds may invest in Brady Bonds. A Fund’s emerging market debt securities may","page_number":139,"box":{"x":215,"y":135,"width":661,"height":12}},{"id":"dd48b9a0-f7c6-4f2b-bc58-e550619ea310","block_type":"box","text":"include emerging market governmental debt obligati","page_number":139,"box":{"x":117,"y":151,"width":376,"height":11}},{"id":"0466c889-fb9a-48a8-852d-8cbbf385f0ba","block_type":"box","text":"ons commonly referred to as Brady Bonds. Brady","page_number":139,"box":{"x":494,"y":150,"width":364,"height":12}},{"id":"509f46db-1723-44eb-a7bf-70d02f81d67c","block_type":"box","text":"Bonds are securities created through the exchange of existing commercial bank loans to sovereign","page_number":139,"box":{"x":117,"y":166,"width":722,"height":12}},{"id":"1421c975-1310-40fb-ba62-3ca45342e38a","block_type":"box","text":"entities for new obligations in connection with debt","page_number":139,"box":{"x":116,"y":181,"width":365,"height":12}},{"id":"c23afca8-d958-4a98-82b6-54f8ceb65310","block_type":"box","text":"t restructurings under a debt restructuring plan","page_number":139,"box":{"x":481,"y":182,"width":338,"height":11}},{"id":"5e3649c6-9894-484c-9ee1-5ff93af5f59e","block_type":"box","text":"introduced by former U.S. Secretary of the Treasury,","page_number":139,"box":{"x":117,"y":197,"width":380,"height":12}},{"id":"7b770815-924e-44ee-ad60-78947e168d62","block_type":"box","text":"Nicholas F. Brady (the “Brady Plan”). Brady Plan","page_number":139,"box":{"x":498,"y":197,"width":364,"height":12}},{"id":"bbfd4391-c9c2-4755-b211-f8606bed5c7f","block_type":"box","text":"debt restructurings have been implemented in a number of","page_number":139,"box":{"x":116,"y":212,"width":427,"height":12}},{"id":"2fcf3605-71e5-43ae-8838-1aab7ca85616","block_type":"box","text":"f countries, including: Argentina, Bolivia, Brazil,","page_number":139,"box":{"x":542,"y":213,"width":342,"height":11}},{"id":"95bcb599-7189-4f87-9a36-290e770c0edc","block_type":"box","text":"Bulgaria, Costa Rica, the Dominican Republic, Ecuado","page_number":139,"box":{"x":117,"y":228,"width":396,"height":12}},{"id":"7392f7a3-7eb8-48e2-bc3d-6abd08cb6f94","block_type":"box","text":"r, Jordan, Mexico, Niger, Nigeria, Panama, Peru,","page_number":139,"box":{"x":515,"y":228,"width":359,"height":12}},{"id":"3d454c46-317d-45a0-a05d-3b562013b11f","block_type":"box","text":"the Philippines, Poland, Uruguay, Venezuela, and Vietnam. Beginning in the early 2000s, certain","page_number":139,"box":{"x":116,"y":244,"width":707,"height":11}},{"id":"e6321408-2308-40c5-8a97-410d8ff6057b","block_type":"box","text":"countries began retiring their Brady Bonds, includi","page_number":139,"box":{"x":116,"y":259,"width":361,"height":12}},{"id":"9f2a334d-9bf8-4a36-972f-b09aeca83181","block_type":"box","text":"ng Brazil, Colombia, Mexico, the Philippines, and","page_number":139,"box":{"x":480,"y":259,"width":360,"height":12}},{"id":"8df0dd40-ef5c-4c29-9912-4092eff57799","block_type":"box","text":"Venezuela.","page_number":139,"box":{"x":116,"y":275,"width":87,"height":9}},{"id":"51006487-aec4-4d88-aa68-54de61bd2ba7","block_type":"box","text":"Brady Bonds may be collateralized or uncollateralized, are issued in various currencies (primarily the","page_number":139,"box":{"x":117,"y":307,"width":758,"height":12}},{"id":"2abc5789-6863-4441-8884-3bc81fa138e7","block_type":"box","text":"U.S. dollar) and are actively traded in the OTC secondary market. Brady Bonds are not considered to","page_number":139,"box":{"x":117,"y":322,"width":762,"height":12}},{"id":"a50d5755-4508-432c-a460-c769cac42030","block_type":"box","text":"be U.S. Government Securities. U.S. dollar-denominated, collateralized Brady Bonds, which may be","page_number":139,"box":{"x":117,"y":338,"width":754,"height":12}},{"id":"fb8760c1-fe8f-436c-8b83-6975486510de","block_type":"box","text":"fixed rate par bonds or floating rate discount bonds, are generally collateralized in full as to principal","page_number":139,"box":{"x":116,"y":353,"width":751,"height":12}},{"id":"6ab0566c-f270-4d0e-a2ce-7d0305242b53","block_type":"box","text":"by U.S. Treasury zero-coupon bonds having the same maturity as the Brady Bonds. Interest","page_number":139,"box":{"x":117,"y":369,"width":694,"height":12}},{"id":"2e343525-29d8-4569-af51-01699ff385ff","block_type":"box","text":"payments on these Brady Bonds generally are collateralized on a one-year or longer rolling-forward","page_number":139,"box":{"x":117,"y":384,"width":749,"height":12}},{"id":"5da978da-6eee-44cf-822b-77841bdd4164","block_type":"box","text":"basis by cash or securities in an amount that, in the case of fixed rate bonds, is equal to at least one","page_number":139,"box":{"x":117,"y":400,"width":753,"height":12}},{"id":"9007b0ab-e2e1-4a89-bbee-7b2e17aef082","block_type":"box","text":"year of interest payments or, in the case of floating rate bonds, initially is equal to at least one year’s","page_number":139,"box":{"x":116,"y":415,"width":754,"height":12}},{"id":"24029848-d011-45fe-9623-3b7c30106f0c","block_type":"box","text":"interest payments based on the applicable interest rate at that time and is adjusted at regular intervals","page_number":139,"box":{"x":117,"y":431,"width":767,"height":12}},{"id":"01cb3d9b-1d88-441f-9d33-99ec1a41c12e","block_type":"box","text":"thereafter. Certain Brady Bonds are entitled to “value recovery payments” in certain circumstances,","page_number":139,"box":{"x":116,"y":446,"width":747,"height":12}},{"id":"27815322-40ad-4925-91c2-7ffc84f62999","block_type":"box","text":"which in effect constitute supplemental interest payments but generally are not collateralized. Brady","page_number":139,"box":{"x":116,"y":462,"width":751,"height":12}},{"id":"30d60241-371a-48e3-ba16-40c7db56b58b","block_type":"box","text":"Bonds are often viewed as having three or four valuation components: (i) the collateralized repayment","page_number":139,"box":{"x":117,"y":477,"width":767,"height":12}},{"id":"1acf7a3c-8215-41cc-a9f7-bf2ba2714d20","block_type":"box","text":"of principal at final maturity; (ii) the collateralized interest payments; (iii) the uncollateralized interest","page_number":139,"box":{"x":116,"y":493,"width":749,"height":12}},{"id":"3814bf2b-c1a6-48d0-b749-5e163e961747","block_type":"box","text":"payments; and (iv) any uncollateralized repayment of principal at maturity (the uncollateralized","page_number":139,"box":{"x":117,"y":508,"width":710,"height":12}},{"id":"f78ee1df-114a-49a8-843d-e46589219691","block_type":"box","text":"amounts constitute the “residual risk”).","page_number":139,"box":{"x":116,"y":524,"width":292,"height":12}},{"id":"6946f5ad-00d1-47f7-9e5d-5533f347f6f8","block_type":"box","text":"Brady Bonds involve various risk factors described above associated with investing in foreign","page_number":139,"box":{"x":117,"y":556,"width":695,"height":12}},{"id":"4b478827-8400-4195-9b7a-b040a87e0bbe","block_type":"box","text":"securities, including the history of defaults with respect to commercial bank loans by public and private","page_number":139,"box":{"x":116,"y":572,"width":765,"height":12}},{"id":"73d96814-5649-4251-8452-96b47dc08cf3","block_type":"box","text":"entities of countries issuing Brady Bonds. In light of the residual risk of Brady Bonds and, among other","page_number":139,"box":{"x":116,"y":587,"width":764,"height":12}},{"id":"fb4208cf-ea8d-4c3c-8f21-e857b3b40388","block_type":"box","text":"factors, the history of defaults, investments in Brady Bonds are considered speculative. There can be","page_number":139,"box":{"x":116,"y":603,"width":756,"height":12}},{"id":"288b0ddb-1273-489f-85c1-f76a1eb4d0aa","block_type":"box","text":"no assurance that Brady Bonds in which the Funds may invest will not be subject to restructuring","page_number":139,"box":{"x":117,"y":618,"width":723,"height":12}},{"id":"60157bed-f387-44f3-8f21-7d6212ac59e4","block_type":"box","text":"arrangements or to requests for new credit, which may cause the Funds to suffer a loss of interest or","page_number":139,"box":{"x":116,"y":634,"width":752,"height":12}},{"id":"f337c911-c74c-409a-ad65-4d67cf3698b7","block_type":"box","text":"principal on any of its holdings.","page_number":139,"box":{"x":117,"y":649,"width":234,"height":12}},{"id":"2ddd43d4-f79b-4cd0-8d76-90783ceee63f","block_type":"box","text":"China Investments Risk.","page_number":139,"box":{"x":117,"y":682,"width":178,"height":9}},{"id":"35c21f7e-fdd1-40c8-ae98-08766583ec77","block_type":"box","text":"Investments in securities of companies domiciled in the People’s Republic of China (“China” or the","page_number":139,"box":{"x":117,"y":705,"width":729,"height":13}},{"id":"37c59424-a261-4b35-973f-e8602603c2f6","block_type":"box","text":"“PRC”), including certain Hong Kong-listed and U.S.-listed securities, involve a high degree of risk and","page_number":139,"box":{"x":116,"y":721,"width":758,"height":12}},{"id":"a60a0205-64e1-46f2-b6da-687f4c89a4c1","block_type":"box","text":"special considerations not typically associated with investing in the U.S. securities markets. Such","page_number":139,"box":{"x":116,"y":736,"width":719,"height":13}},{"id":"d7e6023a-82c2-4664-a381-e6aaa7d68111","block_type":"box","text":"heightened risks include, among others, an authoritarian government, popular unrest associated with","page_number":139,"box":{"x":117,"y":752,"width":747,"height":12}},{"id":"8d0fd9c4-f157-4679-8f76-9f78e668c8d4","block_type":"box","text":"demands for improved political, economic and social conditions, the impact of regional conflict on the","page_number":139,"box":{"x":116,"y":767,"width":748,"height":13}},{"id":"08b8276c-bc32-4bb3-a905-75e78cf96998","block_type":"box","text":"economy and hostile relations with other countries.","page_number":139,"box":{"x":116,"y":783,"width":376,"height":12}},{"id":"7e31f72a-efda-4dca-aac8-271f6476e7b3","block_type":"box","text":"Military conflicts, either in response to internal social unrest or conflicts with other countries, could","page_number":139,"box":{"x":117,"y":815,"width":723,"height":12}},{"id":"f668d6a2-83b7-44f2-aaa8-253b80abfc1f","block_type":"box","text":"disrupt economic development. The Chinese economy is vulnerable to the long-running disagreements","page_number":139,"box":{"x":116,"y":831,"width":769,"height":12}},{"id":"6455e60c-5613-45d0-8a19-6d2e0594eb04","block_type":"box","text":"and religious and nationalist disputes with Tibet and the Xinjiang region. Since 1997, there have been","page_number":139,"box":{"x":116,"y":846,"width":758,"height":12}},{"id":"ccc2df05-109a-40ca-939a-1206817ee40b","block_type":"box","text":"tensions between the Chinese government and many people in Hong Kong who perceive China as","page_number":139,"box":{"x":116,"y":862,"width":738,"height":12}},{"id":"98ee9f3d-c685-4d28-a6bb-ecf20e490e45","block_type":"box","text":"tightening control over Hong Kong’s semi-autonomous liberal political, economic, legal, and social","page_number":139,"box":{"x":116,"y":878,"width":731,"height":11}},{"id":"db4f9598-05a2-47d3-a237-550f74e321c1","block_type":"box","text":"II-52","page_number":139,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"ce294037-be8e-486c-90b0-4de7489f3b7d","block_type":"box","text":"NM1026U-6004382-139/605","page_number":139,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6d18221c-fd48-4e84-a3c7-57bca14043a4","block_type":"box","text":"framework. Protests and unrest have increased tensions even further. Due to the interconnected","page_number":140,"box":{"x":116,"y":87,"width":721,"height":10}},{"id":"29750898-4051-4a0f-ba1c-9e4d92dfd6ea","block_type":"box","text":"nature of the Hong Kong and Chinese economies, this instability in Hong Kong may cause uncertainty","page_number":140,"box":{"x":117,"y":102,"width":761,"height":13}},{"id":"c1458324-d418-461f-a766-c3e4a45932e0","block_type":"box","text":"in the Hong Kong and Chinese markets. China has a complex territorial dispute regarding the","page_number":140,"box":{"x":117,"y":118,"width":697,"height":12}},{"id":"444659b8-511f-4f20-ad44-6879323ee98e","block_type":"box","text":"sovereignty of Taiwan and has made threats of invasion. Taiwan-based companies and individuals are","page_number":140,"box":{"x":116,"y":134,"width":767,"height":12}},{"id":"20665ef2-6e36-4081-886b-71c0d891f656","block_type":"box","text":"significant investors in China. The continuing hostility between China and Taiwan may have an adverse","page_number":140,"box":{"x":116,"y":149,"width":772,"height":12}},{"id":"a4b2df14-b431-4e12-b34a-d55c9b92393d","block_type":"box","text":"impact on the value of the Fund’s investments in China or Taiwan, may cause a suspension in a","page_number":140,"box":{"x":117,"y":165,"width":717,"height":12}},{"id":"ecbbb677-af53-4bb9-b113-681edb5270b5","block_type":"box","text":"Fund’s ability to trade in certain securities or other assets or may otherwise make such investments","page_number":140,"box":{"x":117,"y":180,"width":742,"height":12}},{"id":"4d5dec51-b000-4b2c-8e21-b8f34323f198","block_type":"box","text":"impracticable or impossible. Any escalation of hostility between China and Taiwan would likely have a","page_number":140,"box":{"x":117,"y":196,"width":759,"height":12}},{"id":"63a5286b-0ef8-456f-aca6-c2461f63f8ea","block_type":"box","text":"significant adverse impact on the value of the Fund’s investments in both countries and the region. In","page_number":140,"box":{"x":116,"y":211,"width":755,"height":12}},{"id":"a76a8773-1025-4ed6-b049-8a17a5a755cf","block_type":"box","text":"addition, China has strained international relations with Japan, India, the Philippines and other","page_number":140,"box":{"x":116,"y":227,"width":703,"height":11}},{"id":"2f4c3df0-da7e-41a7-b405-f47de25248a7","block_type":"box","text":"neighbors due to territorial disputes, historical animosities and other defense concerns. Frictions","page_number":140,"box":{"x":117,"y":242,"width":717,"height":12}},{"id":"0d9dd7ce-c155-4928-b7f2-0a8adbbff276","block_type":"box","text":"between China and the Philippines in the South China Sea pose a risk of escalation potentially leading","page_number":140,"box":{"x":117,"y":258,"width":765,"height":12}},{"id":"823e4b42-9bca-4f9d-8160-94bfe7a4d450","block_type":"box","text":"to military conflict. Additionally, China is alleged to have participated in state-sponsored cyberattacks","page_number":140,"box":{"x":116,"y":273,"width":752,"height":12}},{"id":"670b370d-ea24-454b-accd-b85a4897b154","block_type":"box","text":"against foreign companies and foreign governments. Actual and threatened responses to such activity","page_number":140,"box":{"x":116,"y":289,"width":763,"height":12}},{"id":"8d7b918c-910b-48f7-b7ad-5fa3a521bd7f","block_type":"box","text":"and strained international relations, including purchasing restrictions, sanctions, tariffs or cyberattacks","page_number":140,"box":{"x":116,"y":304,"width":760,"height":12}},{"id":"cf2f1a41-9837-4946-8191-133ead4e860a","block_type":"box","text":"on the Chinese government or Chinese companies, may impact China’s economy and Chinese issuers","page_number":140,"box":{"x":116,"y":320,"width":769,"height":12}},{"id":"13cdb0f4-2751-4d2c-99f8-b3df9b5b7492","block_type":"box","text":"of securities in which a Fund invests. China could be affected by military events on the Korean","page_number":140,"box":{"x":116,"y":335,"width":705,"height":12}},{"id":"0a5394a3-7df3-4a3e-93b6-c80969da2fdb","block_type":"box","text":"peninsula or internal instability within North Korea. These situations may cause uncertainty in the","page_number":140,"box":{"x":117,"y":351,"width":723,"height":12}},{"id":"0caaefe5-b216-451e-98b8-169efdd45d6e","block_type":"box","text":"Chinese market and may adversely affect the performance of the Chinese economy.","page_number":140,"box":{"x":117,"y":366,"width":631,"height":12}},{"id":"084177b4-70c8-44dd-9a1c-099b1c202c7d","block_type":"box","text":"The Chinese government has implemented economic reforms in order to liberalize trade policy,","page_number":140,"box":{"x":116,"y":393,"width":712,"height":12}},{"id":"07c7b247-e6ac-4d40-9925-0ad96ad43a9b","block_type":"box","text":"promote foreign investment in the economy, reduce government control of the economy and develop","page_number":140,"box":{"x":117,"y":409,"width":752,"height":12}},{"id":"49f8da67-4e7c-4710-94bf-908e3be2ce5b","block_type":"box","text":"market mechanisms. However, the Chinese government still exercises substantial influence over many","page_number":140,"box":{"x":117,"y":424,"width":768,"height":12}},{"id":"5ea2f40a-1722-4fa2-beda-e6e88c29fc84","block_type":"box","text":"aspects of the private sector and may own or control many companies. Chinese companies, such as","page_number":140,"box":{"x":116,"y":440,"width":751,"height":12}},{"id":"743bc7fe-8c74-489d-b5fb-2aac9ae2caf0","block_type":"box","text":"those in the financial services or technology sectors, and potentially other sectors in the future, are","page_number":140,"box":{"x":116,"y":455,"width":736,"height":12}},{"id":"e6cba134-d437-4a8a-be50-401ed38c51c6","block_type":"box","text":"subject to the risk that Chinese authorities can intervene in their operations and structure. The Chinese","page_number":140,"box":{"x":116,"y":471,"width":769,"height":12}},{"id":"2ffbb0e7-26f1-4d23-b43d-ca37aa9ce21a","block_type":"box","text":"government continues to maintain a major role in economic policymaking and investing in China","page_number":140,"box":{"x":116,"y":486,"width":717,"height":12}},{"id":"b5109827-edca-4e4c-a005-6212c18853ed","block_type":"box","text":"involves risk of loss due to expropriation, nationalization, confiscation of assets and property or the","page_number":140,"box":{"x":117,"y":502,"width":736,"height":12}},{"id":"3242f7f9-e10e-4bc6-afc8-a3d50519eaa2","block_type":"box","text":"imposition of restrictions on foreign investments and on repatriation of capital invested.","page_number":140,"box":{"x":117,"y":517,"width":647,"height":12}},{"id":"362b3c47-3b34-4615-a551-a5a68fb1b35a","block_type":"box","text":"The Chinese government may intervene in the Chinese financial markets, such as by the imposition of","page_number":140,"box":{"x":116,"y":544,"width":764,"height":12}},{"id":"ec87d71f-d366-436a-a781-8ead2d4aa555","block_type":"box","text":"trading restrictions, a ban on “naked” short selling or the suspension of short selling for certain stocks.","page_number":140,"box":{"x":116,"y":560,"width":761,"height":12}},{"id":"e370504d-89f3-469e-9e56-61e0b1a41523","block_type":"box","text":"This may affect market price and liquidity of these stocks, and may have an unpredictable impact on","page_number":140,"box":{"x":116,"y":575,"width":748,"height":12}},{"id":"54bd3d24-970f-4807-9c5f-b64db3115d38","block_type":"box","text":"the investment activities of the Funds. Furthermore, such market interventions may have a negative","page_number":140,"box":{"x":116,"y":591,"width":745,"height":12}},{"id":"794b7978-a165-4f66-a3de-465c34b9f038","block_type":"box","text":"impact on market sentiment which may in turn affect the performance of the securities markets and as","page_number":140,"box":{"x":117,"y":606,"width":762,"height":12}},{"id":"e9ded174-f4e8-47fd-b2e7-d24afa13a939","block_type":"box","text":"a result the performance of the Funds.","page_number":140,"box":{"x":116,"y":622,"width":290,"height":12}},{"id":"0180a5ff-0e9a-4944-9c26-4ffdf7ac9bb9","block_type":"box","text":"In addition, there is less regulation and monitoring of Chinese securities markets and the activities of","page_number":140,"box":{"x":117,"y":649,"width":749,"height":12}},{"id":"b9c684c7-19ed-428d-9d5c-0e92e1f8a02a","block_type":"box","text":"investors, brokers and other participants than in the United States. Accordingly, issuers of securities in","page_number":140,"box":{"x":117,"y":665,"width":757,"height":12}},{"id":"93eb8e80-ed51-4f39-99de-127d02ca6687","block_type":"box","text":"China, including Chinese companies that are listed on U.S. exchanges, are not subject to the same","page_number":140,"box":{"x":117,"y":680,"width":735,"height":12}},{"id":"81e40a56-497a-4b2b-b7ad-26198b3a3476","block_type":"box","text":"degree of regulation as are U.S. issuers with respect to such matters as insider trading rules, tender","page_number":140,"box":{"x":116,"y":696,"width":742,"height":12}},{"id":"4563679f-b021-46bb-b925-b7c7e8b92185","block_type":"box","text":"offer regulation, accounting standards or auditor oversight, stockholder proxy requirements and the","page_number":140,"box":{"x":116,"y":711,"width":735,"height":12}},{"id":"0c4501b4-380c-4cc2-9e5c-29e103f521db","block_type":"box","text":"requirements mandating timely and accurate disclosure of information. Securities markets in China are","page_number":140,"box":{"x":117,"y":727,"width":761,"height":12}},{"id":"a907b439-1072-43e7-af0b-1611860e4c4b","block_type":"box","text":"in the process of change and further development. This may lead to trading volatility, difficulty in the","page_number":140,"box":{"x":117,"y":742,"width":738,"height":12}},{"id":"3cd9e755-a81c-4cb3-a70c-77e837119ef4","block_type":"box","text":"settlement and recording of transactions and difficulty in interpreting and applying the relevant","page_number":140,"box":{"x":116,"y":758,"width":697,"height":12}},{"id":"ea0dde39-0e8a-4cb6-b0fa-69d92132aa6b","block_type":"box","text":"regulation. Custodians may not be able to offer the level of service and safe-keeping in relation to the","page_number":140,"box":{"x":117,"y":773,"width":750,"height":12}},{"id":"c21fe4d1-46f2-427d-94d7-5100d410f6ae","block_type":"box","text":"settlement and administration of securities in China that is customary in more developed markets. In","page_number":140,"box":{"x":116,"y":789,"width":743,"height":12}},{"id":"7a244e10-dd14-417e-a5bf-7151751a1576","block_type":"box","text":"particular, there is a risk that a Fund may not be recognized as the owner of securities that are held on","page_number":140,"box":{"x":117,"y":804,"width":759,"height":12}},{"id":"34110de9-3aff-4f95-8f6c-f300da0699ab","block_type":"box","text":"behalf of the Fund by a sub-custodian.","page_number":140,"box":{"x":117,"y":820,"width":284,"height":12}},{"id":"58b29653-a8b3-4c6b-8994-0646ec04b8c9","block_type":"box","text":"There may be significant obstacles to obtaining information necessary for investigations into or","page_number":140,"box":{"x":116,"y":847,"width":707,"height":12}},{"id":"a53ae31a-9034-41cf-8335-2257776d897e","block_type":"box","text":"litigation against Chinese companies, and shareholders may have limited legal remedies. The Funds","page_number":140,"box":{"x":117,"y":862,"width":751,"height":12}},{"id":"fbc425ba-0194-4188-b12a-b5e57b9b2f05","block_type":"box","text":"do not select investments based on investor protection considerations.","page_number":140,"box":{"x":116,"y":878,"width":528,"height":12}},{"id":"96cb8740-2e27-4eaf-a72f-5d4c720bb710","block_type":"box","text":"II-53","page_number":140,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"49cbd61b-e881-4205-b2d0-1e2b8faf97d1","block_type":"box","text":"NM1026U-6004382-140/605","page_number":140,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3b3eb8ce-8ce3-42cc-ad66-060064d66132","block_type":"box","text":"The Chinese government historically took positions that prevented the U.S. Public Company","page_number":141,"box":{"x":116,"y":87,"width":689,"height":12}},{"id":"c55e0d2f-e85a-4767-8b0c-0ffe8fd1f23a","block_type":"box","text":"Accounting Oversight Board (“PCAOB”) from inspecting the audit work and practices of accounting","page_number":141,"box":{"x":116,"y":102,"width":738,"height":13}},{"id":"d5ae879f-a085-4d90-b864-c0353adb35a6","block_type":"box","text":"firms in mainland China and Hong Kong for compliance with U.S. law and professional standards. On","page_number":141,"box":{"x":116,"y":118,"width":756,"height":12}},{"id":"c0e4197e-e10c-4b90-b266-e6e56a5565b9","block_type":"box","text":"August 26, 2022, the PCAOB signed a Statement of Protocol with the China Securities Regulatory","page_number":141,"box":{"x":116,"y":134,"width":734,"height":12}},{"id":"d2096b9f-b0c0-4cd9-801b-c4ad1b4c6b82","block_type":"box","text":"Commission and the Ministry of Finance of the PRC, which marked the first step toward opening","page_number":141,"box":{"x":117,"y":149,"width":719,"height":12}},{"id":"3ecfdb00-7a60-4700-bc29-7e1b0d5a1641","block_type":"box","text":"access for the PCAOB to inspect and investigate registered public accounting firms headquartered in","page_number":141,"box":{"x":116,"y":165,"width":755,"height":12}},{"id":"40d2f5a2-5623-4129-83cb-905401034cdd","block_type":"box","text":"mainland China and Hong Kong completely in accordance with U.S. law. However, as this","page_number":141,"box":{"x":117,"y":180,"width":672,"height":12}},{"id":"106becdc-41f6-41ab-96bb-c572919353cc","block_type":"box","text":"development is relatively recent, the implementation of the Statement of Protocol remains to be tested.","page_number":141,"box":{"x":116,"y":196,"width":767,"height":12}},{"id":"d4820810-57de-43a3-abfc-37ecba9f4a8f","block_type":"box","text":"Audits performed by PCAOB-registered accounting firms in mainland China and Hong Kong may be","page_number":141,"box":{"x":116,"y":211,"width":747,"height":12}},{"id":"33f029a2-bd69-4932-aa3d-bc9354c9929f","block_type":"box","text":"less reliable than those performed by firms subject to PCAOB inspection. Accordingly, information","page_number":141,"box":{"x":117,"y":227,"width":730,"height":12}},{"id":"0b941a95-94bd-454d-a6d7-e7a15cc47bb2","block_type":"box","text":"about the Chinese securities in which the Funds invest may be less reliable or complete. 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The imposition of","page_number":141,"box":{"x":116,"y":351,"width":740,"height":12}},{"id":"0cdb7260-da00-412b-8676-a745e9f5d6e7","block_type":"box","text":"currency controls may negatively impact performance and liquidity of the Funds as capital may become","page_number":141,"box":{"x":116,"y":366,"width":772,"height":12}},{"id":"598006c7-c527-426e-a13d-67d7659b1492","block_type":"box","text":"trapped in the PRC. The Funds could be adversely affected by delays in, or a refusal to grant, any","page_number":141,"box":{"x":116,"y":382,"width":732,"height":12}},{"id":"68afcdd8-37cc-4cde-aed4-a93140ef5fb6","block_type":"box","text":"required governmental approval for repatriation of capital, as well as by the application to the Funds of","page_number":141,"box":{"x":117,"y":397,"width":762,"height":12}},{"id":"8b1daa8e-8a78-4e59-941f-fdda992e3887","block_type":"box","text":"any restrictions on investments. Investing in entities either in, or which have a substantial portion of","page_number":141,"box":{"x":116,"y":413,"width":740,"height":12}},{"id":"80c5a691-83b3-4cf1-8e88-6b4abae196db","block_type":"box","text":"their operations in, the PRC may require the Funds to adopt special procedures, seek local","page_number":141,"box":{"x":116,"y":428,"width":680,"height":12}},{"id":"6da85187-57ea-4d08-bcb1-15b56d077a24","block_type":"box","text":"government approvals or take other actions, each of which may involve additional costs and delays to","page_number":141,"box":{"x":116,"y":444,"width":759,"height":12}},{"id":"3dcbdeb1-bf33-44be-8ae0-13a1448db78f","block_type":"box","text":"the Funds. The Fund may also incur costs in connection with conversions between U.S. dollars and","page_number":141,"box":{"x":116,"y":459,"width":743,"height":12}},{"id":"d7458a23-c756-4a49-aa1b-5f747368245f","block_type":"box","text":"RMB, as well as in connection with conversions between the two separate types of RMB, the onshore","page_number":141,"box":{"x":117,"y":475,"width":758,"height":12}},{"id":"c3775459-ee5e-4a9d-b636-421a3d222d7b","block_type":"box","text":"RMB (“CNY”) and the offshore RMB (“CNH”).","page_number":141,"box":{"x":117,"y":490,"width":340,"height":12}},{"id":"4322b542-db0c-4bc4-8982-58599ee6ba00","block_type":"box","text":"Many Chinese companies listed on U.S. exchanges use variable interest entities or “VIEs” in their","page_number":141,"box":{"x":117,"y":521,"width":727,"height":12}},{"id":"c78d6f29-cab3-40a2-aff3-43948ea9345e","block_type":"box","text":"structure as a result of foreign ownership restrictions. 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These contracts provide the U.S.-","page_number":141,"box":{"x":116,"y":599,"width":749,"height":12}},{"id":"3158e613-01ed-486a-823f-802570ff50aa","block_type":"box","text":"listed shell company with only economic exposure to the Chinese company and do not represent","page_number":141,"box":{"x":117,"y":614,"width":722,"height":12}},{"id":"cd1685a9-f31a-4776-90f3-d79d1395b704","block_type":"box","text":"equity ownership in the operating company.","page_number":141,"box":{"x":116,"y":630,"width":329,"height":12}},{"id":"5d78ff40-3708-4acf-87e1-f7b1f2c12df4","block_type":"box","text":"While VIEs are a longstanding practice that is well known to Chinese officials and regulators, they have","page_number":141,"box":{"x":116,"y":661,"width":765,"height":12}},{"id":"ede714e2-36bc-407c-9589-5d51e1956f10","block_type":"box","text":"not been formally recognized under Chinese law. The Chinese government has provided guidance to","page_number":141,"box":{"x":117,"y":676,"width":749,"height":12}},{"id":"28caf6a1-2685-4fd9-b1ef-a59c1fccce1e","block_type":"box","text":"and placed restrictions on Chinese-based companies raising capital offshore, including through VIEs.","page_number":141,"box":{"x":116,"y":692,"width":749,"height":12}},{"id":"971ef0fa-990c-4b4b-a964-d51bae12cfc3","block_type":"box","text":"In 2023, the China Securities Regulatory Commission (“CSRC”) released new rules that permit the use","page_number":141,"box":{"x":117,"y":707,"width":762,"height":12}},{"id":"51c0b294-4594-421e-8199-55ac841924a2","block_type":"box","text":"of VIE structures, provided they abide by Chinese laws and register with the CSRC. The rules,","page_number":141,"box":{"x":116,"y":723,"width":699,"height":12}},{"id":"b4f6344a-adca-412f-8840-2e836edd1a57","block_type":"box","text":"however, may cause Chinese companies to undergo greater scrutiny and add costs to VIE structures.","page_number":141,"box":{"x":117,"y":738,"width":753,"height":12}},{"id":"015bedf7-c794-4c53-970f-784cc28bc7bd","block_type":"box","text":"Intervention, rulemaking or guidance by the Chinese government with respect to VIE structures or the","page_number":141,"box":{"x":117,"y":754,"width":753,"height":12}},{"id":"9bce6986-bb4d-4ef5-bf2c-e4db2021fe3e","block_type":"box","text":"non-enforcement of VIE-related contractual rights could significantly affect the operating company’s","page_number":141,"box":{"x":117,"y":769,"width":736,"height":12}},{"id":"88a6f9f1-4252-49fb-abad-1313d000614f","block_type":"box","text":"business in China, the enforceability of the U.S.-listed shell company’s contractual arrangements with","page_number":141,"box":{"x":117,"y":785,"width":751,"height":12}},{"id":"56029bce-394a-4658-b145-6cb7cc510fc1","block_type":"box","text":"the Chinese company and the value of the U.S.-listed stock. 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In addition to the risk of government intervention,","page_number":141,"box":{"x":116,"y":831,"width":731,"height":12}},{"id":"aad89a6a-ef92-476a-a8ae-d64c206a716e","block_type":"box","text":"investments through a VIE structure are subject to the risk that the China-based company (or its","page_number":141,"box":{"x":117,"y":847,"width":717,"height":12}},{"id":"8a210dcb-6d2d-41ee-b7cf-8ff1f5565e1b","block_type":"box","text":"officers, directors, or Chinese equity owners) may breach those contractual arrangements, or Chinese","page_number":141,"box":{"x":116,"y":862,"width":763,"height":12}},{"id":"94cd8da2-2677-406d-a6af-8397fb650d2d","block_type":"box","text":"law changes in a way that adversely affects the enforceability of these arrangements, or those","page_number":141,"box":{"x":117,"y":878,"width":703,"height":12}},{"id":"1c574b62-7c4b-489a-97a5-cea2e0e34b53","block_type":"box","text":"II-54","page_number":141,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"0c7739ae-a5f8-4741-a2cd-1f64b9b209d6","block_type":"box","text":"NM1026U-6004382-141/605","page_number":141,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"373531b8-36e8-4592-86d3-fd646b2cc54c","block_type":"box","text":"contracts are otherwise not enforceable under Chinese law, in which case the Fund may suffer","page_number":142,"box":{"x":116,"y":87,"width":708,"height":12}},{"id":"8e029e68-910a-40cf-993d-d71fa72da950","block_type":"box","text":"significant losses on its investments through a VIE structure with little or no recourse available. Any","page_number":142,"box":{"x":116,"y":102,"width":741,"height":13}},{"id":"982ac4b7-8fb3-4c2b-8b92-9ca16da09ae7","block_type":"box","text":"change in the operations of entities in a VIE structure, the status of VIE contractual arrangements or","page_number":142,"box":{"x":116,"y":118,"width":748,"height":12}},{"id":"0b17f74e-0cd7-458d-b665-bfab37450806","block_type":"box","text":"the legal or regulatory environment in China, generally or with respect to specific industries, could","page_number":142,"box":{"x":116,"y":134,"width":729,"height":12}},{"id":"35392ecd-382c-4d60-be97-2daf9173b257","block_type":"box","text":"result in significant, and possibly permanent and/or total, losses to a Fund.","page_number":142,"box":{"x":117,"y":149,"width":556,"height":12}},{"id":"276ba536-4126-42ba-b0ac-5dfecbbd2266","block_type":"box","text":"While the Chinese economy has experienced past periods of rapid growth, there is no assurance that","page_number":142,"box":{"x":116,"y":178,"width":758,"height":12}},{"id":"7ae97861-b117-4e19-ad47-b35475adc3b7","block_type":"box","text":"such growth rates will recur. Other economic challenges for China include indebtedness, weak","page_number":142,"box":{"x":116,"y":194,"width":706,"height":12}},{"id":"c5ad2636-d78b-48d2-8b62-a63a74c6a14a","block_type":"box","text":"consumer demand, trade tensions, and an aging population. China continues to face pressure from its","page_number":142,"box":{"x":116,"y":209,"width":763,"height":12}},{"id":"69514c20-e3a8-4f4e-9078-28fd62a849e7","block_type":"box","text":"trading partners over its exporting of its excess industrial capacity and overall approach to economic","page_number":142,"box":{"x":116,"y":225,"width":748,"height":12}},{"id":"6f90093f-78b3-423a-821f-fb1cf447df80","block_type":"box","text":"management. China’s economy is heavily dependent on export growth. Reduction in spending on","page_number":142,"box":{"x":117,"y":240,"width":727,"height":12}},{"id":"3d8fa055-1bea-4bb8-8c2e-d60df5778550","block_type":"box","text":"Chinese products and services, supply chain diversification, institution of additional tariffs, sanctions or","page_number":142,"box":{"x":117,"y":256,"width":765,"height":12}},{"id":"4bfeddc5-8c1b-45d5-8d4f-098862fb14d0","block_type":"box","text":"other trade barriers (including as a result of heightened trade tensions between China and the United","page_number":142,"box":{"x":116,"y":271,"width":755,"height":12}},{"id":"59ea5cf6-6b72-469f-9479-5ff5bd28fcc5","block_type":"box","text":"States or in response to actual or alleged Chinese cyber activity) or a downturn in any of the","page_number":142,"box":{"x":116,"y":287,"width":688,"height":12}},{"id":"c5f2464a-36a4-4568-81f4-6bf285b18c36","block_type":"box","text":"economies of China’s key trading partners may have an adverse impact on the Chinese economy and","page_number":142,"box":{"x":116,"y":302,"width":762,"height":12}},{"id":"f155c838-a8ac-4a01-90da-e0149a53c2b4","block_type":"box","text":"the companies in which a Fund invests. Certain Chinese companies (which may change from time to","page_number":142,"box":{"x":116,"y":318,"width":753,"height":12}},{"id":"089201e3-cd84-4472-bae0-ab03b5a41d03","block_type":"box","text":"time) are directly or indirectly subject to economic or trade restrictions imposed by the U.S. or other","page_number":142,"box":{"x":116,"y":333,"width":741,"height":12}},{"id":"e3f181d2-7fbc-400b-989d-5d5ccbb3b382","block_type":"box","text":"governments due to national security, human rights or other concerns of such government. For","page_number":142,"box":{"x":116,"y":349,"width":709,"height":12}},{"id":"ce28adbf-e280-49f5-929b-efdbbdb5a1fd","block_type":"box","text":"example, certain foreign technology companies are subject to U.S. export controls as those companies","page_number":142,"box":{"x":116,"y":364,"width":769,"height":12}},{"id":"9b1a6cd5-8ffe-4f63-a9b5-1fca3f223064","block_type":"box","text":"are believed to pose a risk to U.S. interests. The U.S. also bans imports of goods produced in certain","page_number":142,"box":{"x":116,"y":380,"width":755,"height":12}},{"id":"811a672a-ecf1-4606-93c9-3e9ba89b007f","block_type":"box","text":"regions of China or by certain Chinese companies due to concerns about forced labor. Such","page_number":142,"box":{"x":117,"y":395,"width":688,"height":12}},{"id":"a37cbb2d-10c2-4654-9ba9-5be862d6191e","block_type":"box","text":"restrictions may have unanticipated and adverse effects on the Chinese economy and companies. Any","page_number":142,"box":{"x":117,"y":411,"width":767,"height":12}},{"id":"d2dd7ed9-a9bf-43af-843c-b0b025f1f8c8","block_type":"box","text":"action that targets Chinese financial markets or securities exchanges could interfere with orderly","page_number":142,"box":{"x":116,"y":426,"width":719,"height":12}},{"id":"93b80daa-333f-47ca-b14b-10d3c49be1c0","block_type":"box","text":"trading, delay settlement or cause market disruptions. Certain companies may be subject to economic","page_number":142,"box":{"x":116,"y":442,"width":762,"height":12}},{"id":"120f292c-9d02-4c17-8f52-0c9c26f0e18f","block_type":"box","text":"or trade restrictions (but not investment restrictions) imposed by the U.S. or other governments due to","page_number":142,"box":{"x":116,"y":457,"width":761,"height":12}},{"id":"c67fb564-6dc5-4cd6-bc53-50755a23581c","block_type":"box","text":"national security, human rights or other concerns of such government. So long as these restrictions do","page_number":142,"box":{"x":117,"y":473,"width":764,"height":12}},{"id":"b9cc5213-88ea-46a8-859e-06a28fde055c","block_type":"box","text":"not include restrictions on investments, the Fund may invest in such companies.","page_number":142,"box":{"x":117,"y":489,"width":599,"height":11}},{"id":"f7d81a7d-f054-4cb1-b365-e6522e209fac","block_type":"box","text":"The tax laws and regulations in the PRC are subject t","page_number":142,"box":{"x":116,"y":518,"width":374,"height":12}},{"id":"39fed86d-0d53-40d0-b266-1c2ce49d7569","block_type":"box","text":"to change, including the issuance of authoritative","page_number":142,"box":{"x":490,"y":518,"width":352,"height":12}},{"id":"72c9c7ca-0ec8-4305-90e7-073559964cf0","block_type":"box","text":"guidance or enforcement, possibly with retroactive e","page_number":142,"box":{"x":116,"y":533,"width":370,"height":12}},{"id":"ca175381-6dfa-4339-a670-60ff4e6309c0","block_type":"box","text":"ffect. The interpretation, applicability and enforcement","page_number":142,"box":{"x":487,"y":533,"width":386,"height":12}},{"id":"7ac38c1c-4df8-41f9-8842-0a66196a8f22","block_type":"box","text":"of such laws by PRC tax authorities are not as c","page_number":142,"box":{"x":116,"y":549,"width":341,"height":12}},{"id":"eb8700cc-1913-4b5d-9687-e0e85cae2707","block_type":"box","text":"onsistent and transparent as those of more developed","page_number":142,"box":{"x":458,"y":549,"width":389,"height":12}},{"id":"73b1c024-f1e1-4ee2-87d5-750a5623214b","block_type":"box","text":"nations, and may vary over time and from region to","page_number":142,"box":{"x":117,"y":564,"width":362,"height":12}},{"id":"ae6f77b0-6f73-4407-baef-7bbac5f6b7bf","block_type":"box","text":"region. The application and enforcement of PRC tax","page_number":142,"box":{"x":479,"y":564,"width":380,"height":12}},{"id":"cd12a5d7-a0dd-4d1d-aa95-626df509a5d8","block_type":"box","text":"rules could have a significant adverse effect on a Fund and","page_number":142,"box":{"x":117,"y":580,"width":423,"height":12}},{"id":"8f7bb77e-270b-4084-aa9c-27fc2788e354","block_type":"box","text":"its investors, particularly in relation to capital","page_number":142,"box":{"x":541,"y":580,"width":316,"height":12}},{"id":"f1d0e058-d961-41f8-bd2d-3cfeafacfab2","block_type":"box","text":"gains withholding tax imposed upon non-residents. In","page_number":142,"box":{"x":116,"y":595,"width":383,"height":12}},{"id":"6f4aa12c-e13f-446b-9763-716a0d6f39e7","block_type":"box","text":"addition, the accounting, auditing and financial","page_number":142,"box":{"x":500,"y":595,"width":333,"height":12}},{"id":"17e6afc9-d847-4c4b-9372-cb8f519ed495","block_type":"box","text":"reporting standards and practices applicable to Chinese companies may be less rigorous, and may result in","page_number":142,"box":{"x":117,"y":611,"width":767,"height":12}},{"id":"f99dfb12-ceb8-41d0-9213-9c4a4537e64c","block_type":"box","text":"significant differences between financial stat","page_number":142,"box":{"x":116,"y":626,"width":313,"height":12}},{"id":"e3212612-45df-46e4-950b-1982e8170f81","block_type":"box","text":"ements prepared in accordance with PRC accounting","page_number":142,"box":{"x":429,"y":626,"width":385,"height":12}},{"id":"d96441c0-386a-49ae-8d5c-e228939b3898","block_type":"box","text":"standards and practice and those prepared in acco","page_number":142,"box":{"x":116,"y":642,"width":362,"height":12}},{"id":"bed64cfb-408f-427f-92f1-1741d9de952f","block_type":"box","text":"rdance with international accounting standards.","page_number":142,"box":{"x":479,"y":642,"width":340,"height":12}},{"id":"6326fb31-066a-4d3c-b91e-68b8fd874785","block_type":"box","text":"From time to time and in recent years, China has experienced outbreaks of infectious illnesses and the","page_number":142,"box":{"x":117,"y":671,"width":762,"height":12}},{"id":"480e9342-b80e-45d3-987e-90aeb90a3b69","block_type":"box","text":"country may be subject to other public health threats, infectious illnesses, diseases or similar issues in","page_number":142,"box":{"x":116,"y":686,"width":757,"height":13}},{"id":"3de55d56-7e3a-4976-8186-760c0c47090b","block_type":"box","text":"the future. Any spread of an infectious illness, public health threat or similar issue could reduce","page_number":142,"box":{"x":116,"y":702,"width":704,"height":12}},{"id":"6436cd08-35e2-4786-8b4a-0c7f09f17873","block_type":"box","text":"consumer demand or economic output, result in market closures, travel restrictions or quarantines, and","page_number":142,"box":{"x":116,"y":718,"width":764,"height":11}},{"id":"dc795236-f10a-469c-8ca3-b3196770f40d","block_type":"box","text":"generally have a significant impact on the Chinese economy, which in turn could adversely affect a","page_number":142,"box":{"x":116,"y":733,"width":732,"height":12}},{"id":"5a03be8e-6a10-4a23-9548-446a60a00668","block_type":"box","text":"Fund’s investments.","page_number":142,"box":{"x":117,"y":749,"width":147,"height":9}},{"id":"815faf89-21d8-49d5-b561-6d545b1c26a8","block_type":"box","text":"Risk of Investing through Stock Connect","page_number":142,"box":{"x":116,"y":778,"width":300,"height":12}},{"id":"1d1f0a2c-05ac-4158-b736-30e9f5df37d1","block_type":"box","text":".","page_number":142,"box":{"x":417,"y":786,"width":1,"height":1}},{"id":"f90a3885-4e02-47ab-9ffa-38985bc494fc","block_type":"box","text":"General.","page_number":142,"box":{"x":117,"y":800,"width":62,"height":10}},{"id":"52aad9a2-0795-4da9-94d6-f45251e54a7b","block_type":"box","text":"China A-shares are equity securities of companies domiciled in China that trade on Chinese","page_number":142,"box":{"x":186,"y":800,"width":681,"height":12}},{"id":"819c2fb2-18a1-4da1-8f7e-4f261dbebc09","block_type":"box","text":"stock exchanges such as the Shanghai Stock Exchange (“SSE”), the Shenzhen Stock Exchange","page_number":142,"box":{"x":116,"y":816,"width":718,"height":12}},{"id":"e580f40b-24f4-4e01-baf4-914cb9bdcc3f","block_type":"box","text":"(“SZSE”) and the Beijing Stock Exchange (“BSE”) (“A-shares”). Foreign investment in A-shares on the","page_number":142,"box":{"x":117,"y":831,"width":761,"height":12}},{"id":"db5b70be-1ccf-483b-b88f-092861fd166b","block_type":"box","text":"SSE and SZSE is not permitted, other than pursuant to available exceptions, such as through a","page_number":142,"box":{"x":116,"y":847,"width":713,"height":12}},{"id":"dee8bd36-b418-433f-a132-ebc6ed3ad9ee","block_type":"box","text":"qualified foreign investor approved pursuant to the relevant mainland China laws and regulations as","page_number":142,"box":{"x":116,"y":862,"width":745,"height":12}},{"id":"61d28eb4-45cd-4688-b894-445b68aa9c48","block_type":"box","text":"may be promulgated and/or amended from time to time (“QFI”).","page_number":142,"box":{"x":117,"y":878,"width":474,"height":12}},{"id":"eb7de0a3-289b-446d-bcce-09dc4751b411","block_type":"box","text":"II-55","page_number":142,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"6cbd5821-c8b5-4350-8af9-8c70cc9fb572","block_type":"box","text":"NM1026U-6004382-142/605","page_number":142,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"612dbde2-7cd0-4c7f-a94e-572b461a154d","block_type":"box","text":"Investment in eligible exchange traded funds and A-shares listed and traded on the SSE or SZSE","page_number":143,"box":{"x":117,"y":87,"width":728,"height":12}},{"id":"50469aea-cfb7-4b97-b64c-b6d054861b05","block_type":"box","text":"(“Stock Connect Securities”) is also permitted through the Shanghai-Hong Kong Stock Connect","page_number":143,"box":{"x":117,"y":102,"width":711,"height":13}},{"id":"6b766c18-0e3c-4fd0-b58d-7dd59587dce6","block_type":"box","text":"program or the Shenzhen-Hong Kong Stock Connect program, as applicable (each, a “Stock Connect”","page_number":143,"box":{"x":117,"y":118,"width":764,"height":12}},{"id":"52aa574a-7674-4435-abd1-7edc3d8ff564","block_type":"box","text":"and collectively, “Stock Connects”). Each Stock Connect is a securities trading and clearing links","page_number":143,"box":{"x":116,"y":134,"width":722,"height":12}},{"id":"a1677d34-af81-4609-a38c-36d82de8c730","block_type":"box","text":"program established by The Stock Exchange of Hong Kong Limited (“SEHK”), the Hong Kong","page_number":143,"box":{"x":117,"y":149,"width":699,"height":12}},{"id":"90044067-14ff-4763-aeb2-8758f8c21b5a","block_type":"box","text":"Securities Clearing Company Limited (“HKSCC”), the SSE or SZSE, as applicable, and China","page_number":143,"box":{"x":116,"y":165,"width":700,"height":12}},{"id":"06148a50-a0db-4947-b2ff-2deeef8afa15","block_type":"box","text":"Securities Depository and Clearing Corporation Limited (“CSDCC”) that aims to provide mutual stock","page_number":143,"box":{"x":116,"y":180,"width":753,"height":12}},{"id":"98e878e3-3975-4341-89de-1c786f73791d","block_type":"box","text":"market access between the PRC and Hong Kong by permitting investors to trade and settle shares on","page_number":143,"box":{"x":117,"y":196,"width":761,"height":12}},{"id":"6966f937-b5fb-4eae-a719-280d4bd747e6","block_type":"box","text":"each market through their local securities brokers. Under Stock Connects, a Fund’s trading of Stock","page_number":143,"box":{"x":116,"y":211,"width":746,"height":12}},{"id":"de582557-93a7-43cb-9d4b-0feacf633ff9","block_type":"box","text":"Connect Securities listed on the SSE or SZSE, as applicable, would be effectuated through its Hong","page_number":143,"box":{"x":117,"y":227,"width":747,"height":12}},{"id":"dc22c71c-45b3-4089-8f8b-b067af76706a","block_type":"box","text":"Kong broker and a securities trading service company established by SEHK.","page_number":143,"box":{"x":117,"y":242,"width":572,"height":12}},{"id":"4260c6c2-87b5-4728-956f-b7b81018cd22","block_type":"box","text":"Although no individual investment quotas or licensing requirements apply to investors in Stock","page_number":143,"box":{"x":116,"y":273,"width":703,"height":12}},{"id":"cb1ab7bd-0a39-4fd1-839b-2fb615b8fa68","block_type":"box","text":"Connect, trading through a Stock Connect’s Northbound Trading Link is subject to daily investment","page_number":143,"box":{"x":117,"y":289,"width":738,"height":12}},{"id":"16ceac1e-8704-4bb0-b0ba-fd7114f543a1","block_type":"box","text":"quota limitations which require that buy orders for Stock Connect Securities be rejected once the daily","page_number":143,"box":{"x":116,"y":304,"width":761,"height":12}},{"id":"ba87eaf3-5a38-4211-818b-592ec1126a50","block_type":"box","text":"quota is exceeded (although a Fund will be permitted to sell their Stock Connect Securities regardless","page_number":143,"box":{"x":116,"y":320,"width":761,"height":12}},{"id":"02d836e4-55e6-4341-98f3-ff0137d57fdd","block_type":"box","text":"of the quota). These limitations may restrict a Fund from investing in Stock Connect Securities on a","page_number":143,"box":{"x":116,"y":335,"width":741,"height":12}},{"id":"b5980351-8b79-46b8-8878-10e2ee9e2095","block_type":"box","text":"timely basis, which could affect the Fund’s ability to effectively pursue its investment strategy.","page_number":143,"box":{"x":116,"y":351,"width":698,"height":12}},{"id":"4fb4c7e4-f878-4a25-8ec3-40e6f973f94f","block_type":"box","text":"Investment quotas are also subject to change. Investment in Stock Connect Securities through a Stock","page_number":143,"box":{"x":117,"y":366,"width":767,"height":12}},{"id":"0d500a39-c443-4dd9-8e29-360a1d2b576d","block_type":"box","text":"Connect is subject to trading, clearance and settlement procedures that could pose risks to a Fund.","page_number":143,"box":{"x":117,"y":382,"width":741,"height":12}},{"id":"e1444b05-cef5-463f-9e96-978e22f20beb","block_type":"box","text":"Stock Connect Securities purchased through Stock Connects generally may not be sold or otherwise","page_number":143,"box":{"x":116,"y":397,"width":753,"height":12}},{"id":"39ca9dfa-1847-4fb7-a607-9d8b9a8ba1d9","block_type":"box","text":"transferred other than through Stock Connects in accordance with applicable rules. For example, the","page_number":143,"box":{"x":116,"y":413,"width":752,"height":12}},{"id":"5e204c14-26e5-4113-b72f-ec40281254d4","block_type":"box","text":"PRC regulations require that in order for an investor to sell any Stock Connect Securities on a certain","page_number":143,"box":{"x":117,"y":428,"width":755,"height":12}},{"id":"f12693d6-e9d4-45f2-8abd-2a9a7c48114d","block_type":"box","text":"trading day, there must be sufficient Stock Connect Securities in the investor’s account before the","page_number":143,"box":{"x":116,"y":444,"width":730,"height":12}},{"id":"834eea52-612b-492a-a171-0e49e11b639f","block_type":"box","text":"market opens on that day. If there are insufficient Stock Connect Securities in the investor’s account,","page_number":143,"box":{"x":117,"y":459,"width":751,"height":12}},{"id":"bd30ba32-ffb1-4bfc-b861-7227b046992c","block_type":"box","text":"the sell order will be rejected by the SSE or SZSE, as applicable. SEHK carries out pre-trade checking","page_number":143,"box":{"x":116,"y":475,"width":765,"height":12}},{"id":"795d7ee8-c50b-43f9-90f1-9edf7d044914","block_type":"box","text":"on sell orders of certain stocks listed on the SSE market (“SSE Securities”) or SZSE market (“SZSE","page_number":143,"box":{"x":116,"y":490,"width":746,"height":12}},{"id":"4be71905-6a32-4b50-9af3-aaadf109030d","block_type":"box","text":"Securities”) of its participants (i.e., stock brokers) to ensure that this requirement is satisfied. While","page_number":143,"box":{"x":116,"y":506,"width":736,"height":12}},{"id":"acbdd247-f955-4eac-a664-3ac703cd8601","block_type":"box","text":"shares must be designated as eligible to be traded under a Stock Connect, those shares may also lose","page_number":143,"box":{"x":116,"y":521,"width":770,"height":12}},{"id":"e640f823-b192-47a0-aeea-543aaf4d1907","block_type":"box","text":"such designation, and if this occurs, such shares may be sold but cannot be purchased through a","page_number":143,"box":{"x":116,"y":537,"width":728,"height":12}},{"id":"aba253f8-420f-4369-b4c3-664177f381a9","block_type":"box","text":"Stock Connect. In addition, Stock Connects will only operate on days when both the Chinese and Hong","page_number":143,"box":{"x":116,"y":552,"width":771,"height":12}},{"id":"72b4e604-7872-49f8-9768-3787840d35eb","block_type":"box","text":"Kong markets are open for trading, and banking services are available in both markets on the","page_number":143,"box":{"x":117,"y":568,"width":698,"height":12}},{"id":"04438b03-a740-45d8-8063-97b66b7ade34","block_type":"box","text":"corresponding settlement days. Therefore, an investment in Stock Connect Securities through a Stock","page_number":143,"box":{"x":116,"y":583,"width":763,"height":12}},{"id":"2f206d97-292d-426f-8c58-65675faacc9d","block_type":"box","text":"Connect may subject a Fund to a risk of price fluctuations on days when the Chinese market is open,","page_number":143,"box":{"x":117,"y":599,"width":754,"height":12}},{"id":"2b11a4c0-eeb2-499c-8f87-6368f4de51aa","block_type":"box","text":"but a Stock Connect is not trading. Moreover, day (turnaround) trading is not permitted on the Stock","page_number":143,"box":{"x":117,"y":614,"width":745,"height":12}},{"id":"2d5e7099-84cf-45dc-9675-3ee7fea9635d","block_type":"box","text":"Connect Securities market. If an investor buys Stock Connect Securities on day “T,” the investor will","page_number":143,"box":{"x":117,"y":630,"width":746,"height":12}},{"id":"bbc7003e-8a59-441b-b216-ff01de4cbbf3","block_type":"box","text":"only be able to sell the Stock Connect Securities on or after day T+1. Further, since all trades of Stock","page_number":143,"box":{"x":116,"y":645,"width":763,"height":12}},{"id":"cecd4c96-a4b8-4783-8b90-3be65577a03b","block_type":"box","text":"Connect Securities must be settled in RMB, investors must have timely access to a reliable supply of","page_number":143,"box":{"x":117,"y":661,"width":748,"height":12}},{"id":"bbb7de41-ea69-497b-8b36-b0cf1e57cc88","block_type":"box","text":"offshore RMB, which cannot be guaranteed. There is also no assurance that RMB will not be subject to","page_number":143,"box":{"x":116,"y":676,"width":765,"height":12}},{"id":"d3c915aa-33a6-4a64-8036-1a0eb0234dd5","block_type":"box","text":"devaluation. Any devaluation of RMB could adversely affect a Fund’s investments. If a Fund holds a","page_number":143,"box":{"x":116,"y":692,"width":741,"height":12}},{"id":"8e1f0965-ba54-40be-a14f-1c418c3c4736","block_type":"box","text":"class of shares denominated in a local currency other than RMB, the Fund will be exposed to currency","page_number":143,"box":{"x":116,"y":707,"width":760,"height":12}},{"id":"f2b40de5-f2eb-4288-ba62-58b62133da16","block_type":"box","text":"exchange risk if the Fund converts the local currency into RMB for investments in Stock Connect","page_number":143,"box":{"x":116,"y":723,"width":717,"height":12}},{"id":"4283dddc-a551-4b81-ab6d-b270fd39f4d7","block_type":"box","text":"Securities. A Fund may also incur conversion costs.","page_number":143,"box":{"x":116,"y":738,"width":384,"height":12}},{"id":"4b409840-8db9-421e-9015-2beb886218a3","block_type":"box","text":"Stock Connect Securities held through the nominee structure under a Stock Connect will be held","page_number":143,"box":{"x":116,"y":769,"width":716,"height":12}},{"id":"84213419-37d3-428c-9a16-7725ce5b6368","block_type":"box","text":"through HKSCC as nominee on behalf of investors. The precise nature and rights of a Fund as the","page_number":143,"box":{"x":116,"y":785,"width":731,"height":12}},{"id":"c5162ffa-3b69-403a-8a61-8fb13b480d27","block_type":"box","text":"beneficial owner of the SSE Securities or SZSE Securities through HKSCC as nominee is not well","page_number":143,"box":{"x":117,"y":800,"width":725,"height":12}},{"id":"d694824d-53db-4cc8-b68c-6dcb955fa765","block_type":"box","text":"defined under the PRC laws. There is a lack of a clear definition of, and distinction between, legal","page_number":143,"box":{"x":116,"y":816,"width":722,"height":12}},{"id":"840294f5-a868-4b5a-b204-e3147d3cd668","block_type":"box","text":"ownership and beneficial ownership under the PRC laws and there have been few cases involving a","page_number":143,"box":{"x":116,"y":831,"width":748,"height":12}},{"id":"31fae85b-958f-427b-bfc7-133855241404","block_type":"box","text":"nominee account structure in the PRC courts. The exact nature and methods of enforcement of the","page_number":143,"box":{"x":117,"y":847,"width":740,"height":9}},{"id":"66408e81-9586-49dc-9463-4a5a0d1c3f8a","block_type":"box","text":"rights and interests of a Fund under the PRC laws is also uncertain. In the unlikely event that HKSCC","page_number":143,"box":{"x":117,"y":862,"width":757,"height":12}},{"id":"579cbbf0-3dd1-4b8c-a868-1e2e614c1331","block_type":"box","text":"becomes subject to winding up proceedings in Hong Kong, there is a risk that the SSE Securities or","page_number":143,"box":{"x":117,"y":878,"width":743,"height":12}},{"id":"ca587b95-4d73-4a2f-b14d-bc0a9317cc2e","block_type":"box","text":"II-56","page_number":143,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"bcfadc00-1bd7-42f3-b83b-6923110f312a","block_type":"box","text":"NM1026U-6004382-143/605","page_number":143,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f3f19eff-3e98-4e55-8411-80b08e33518a","block_type":"box","text":"SZSE Securities may not be regarded as held for the beneficial ownership of a Fund or as part of the","page_number":144,"box":{"x":116,"y":87,"width":754,"height":12}},{"id":"8292a1e6-b344-4203-a4a9-f78c797352b1","block_type":"box","text":"general assets of HKSCC available for general distribution to its creditors. Notwithstanding the fact that","page_number":144,"box":{"x":116,"y":102,"width":770,"height":13}},{"id":"30a0edec-73e4-40f9-b92b-b6781eee2951","block_type":"box","text":"HKSCC does not claim proprietary interests in the SSE Securities or SZSE Securities held in its","page_number":144,"box":{"x":117,"y":118,"width":714,"height":12}},{"id":"5f5ca186-95a8-4361-855a-16e949a3269b","block_type":"box","text":"omnibus stock account in the CSDCC, the CSDCC as the share registrar for SSE- or SZSE-listed","page_number":144,"box":{"x":116,"y":134,"width":729,"height":12}},{"id":"0c0dfbbf-b304-4d87-849c-6f14f979ee9d","block_type":"box","text":"companies will still treat HKSCC as one of the shareholders when it handles corporate actions in","page_number":144,"box":{"x":116,"y":149,"width":722,"height":12}},{"id":"0800da09-643c-40f6-a478-a1e0f995fe91","block_type":"box","text":"respect of such SSE Securities or SZSE Securities. HKSCC monitors the corporate actions affecting","page_number":144,"box":{"x":117,"y":165,"width":749,"height":12}},{"id":"d84c41d5-45f6-4371-9651-d23396dc6081","block_type":"box","text":"SSE Securities and SZSE Securities and keeps participants of Central Clearing and Settlement","page_number":144,"box":{"x":116,"y":180,"width":712,"height":12}},{"id":"5b0017d7-8728-48bb-af41-96aa1e51e1c0","block_type":"box","text":"System (“CCASS”) informed of all such corporate actions that require CCASS participants to take","page_number":144,"box":{"x":116,"y":196,"width":729,"height":12}},{"id":"528972ab-3234-407c-a264-68091cddc4bc","block_type":"box","text":"steps in order to participate in them. Investors may only exercise their voting rights by providing their","page_number":144,"box":{"x":116,"y":211,"width":750,"height":12}},{"id":"18ceead7-0aa1-4a7f-a671-fd4154195dfc","block_type":"box","text":"voting instructions to HKSCC through participants of CCASS. All voting instructions from CCASS","page_number":144,"box":{"x":116,"y":227,"width":724,"height":12}},{"id":"5a121ea4-7405-4fe3-a493-3904eb27a3b7","block_type":"box","text":"participants will be consolidated by HKSCC, who will then submit a combined single voting instruction","page_number":144,"box":{"x":117,"y":242,"width":757,"height":12}},{"id":"46af71c8-c5b3-4e64-b26a-29ac5065a0ba","block_type":"box","text":"to the relevant SSE- or SZSE-listed company. As a result, a Fund may suffer difficulties or delays in","page_number":144,"box":{"x":116,"y":258,"width":745,"height":12}},{"id":"0e2835e5-ccea-476d-ac67-fbb5928cbd84","block_type":"box","text":"enforcing its rights in SSE Securities or SZSE Securities.","page_number":144,"box":{"x":116,"y":273,"width":427,"height":12}},{"id":"b5e0f895-848d-4883-8afd-cd93421c063b","block_type":"box","text":"Hong Kong’s Investor Compensation Fund is established to pay compensation to investors of any","page_number":144,"box":{"x":117,"y":304,"width":728,"height":12}},{"id":"513bb1fd-b79a-4b45-a8b7-6619d744cb37","block_type":"box","text":"nationality who suffer pecuniary losses as a result of default of a licensed intermediary or authorized","page_number":144,"box":{"x":117,"y":320,"width":747,"height":12}},{"id":"ed404008-9bc8-484e-bed6-a2729dda1178","block_type":"box","text":"financial institution in relation to exchange-traded products in Hong Kong. For defaults occurring on or","page_number":144,"box":{"x":116,"y":335,"width":760,"height":12}},{"id":"33fec891-cce9-4083-af55-653c3498b19c","block_type":"box","text":"after January 1, 2020, Hong Kong’s Investor Compensation Fund covers investors’ losses in relation to","page_number":144,"box":{"x":116,"y":351,"width":769,"height":12}},{"id":"4dae9abc-f7ae-42b0-b361-96b332712faa","block_type":"box","text":"securities (i) that are traded on the SSE or the SZSE and (ii) in respect of which an order for sale or","page_number":144,"box":{"x":116,"y":366,"width":743,"height":12}},{"id":"2c39590c-6f9e-4982-b512-a3aa819dfd7c","block_type":"box","text":"purchase is permitted to be routed through the Northbound Trading Link of a Stock Connect. On the","page_number":144,"box":{"x":117,"y":382,"width":746,"height":12}},{"id":"a1dfa18d-17f7-4cd8-8397-a5513b0b776f","block_type":"box","text":"other hand, since a Fund carries out Northbound trading through securities brokers in Hong Kong but","page_number":144,"box":{"x":116,"y":397,"width":756,"height":12}},{"id":"9b24b8e9-2cb5-4753-a3da-91b1c85b3b1a","block_type":"box","text":"not PRC brokers, it is not protected by the China Securities Investor Protection Fund in the PRC.","page_number":144,"box":{"x":117,"y":413,"width":722,"height":12}},{"id":"37cbbbec-d08b-499a-98a2-4d6078f43649","block_type":"box","text":"Market participants are able to participate in Stock Connects subject to meeting certain information","page_number":144,"box":{"x":117,"y":444,"width":737,"height":12}},{"id":"51e4be04-6a98-4d97-8e9c-7e5e56d4002b","block_type":"box","text":"technology capability, risk management and other requirements as may be specified by the relevant","page_number":144,"box":{"x":116,"y":459,"width":746,"height":12}},{"id":"0dcd79a7-8a38-4efe-afb7-78e1096bd5e9","block_type":"box","text":"exchange and/or clearing house. Further, the “connectivity” in Stock Connects requires routing of","page_number":144,"box":{"x":116,"y":475,"width":725,"height":12}},{"id":"d8a31b50-9466-46cf-89e2-7a7adc15fb8d","block_type":"box","text":"orders across the border of Hong Kong and the PRC. This requires the development of new","page_number":144,"box":{"x":116,"y":490,"width":687,"height":12}},{"id":"ee58c93b-9213-4855-8457-473d87e38661","block_type":"box","text":"information technology systems on the part of SEHK and exchange participants. There is no assurance","page_number":144,"box":{"x":117,"y":506,"width":771,"height":12}},{"id":"1d3f9e2e-d066-4403-9228-0a415b45b1ea","block_type":"box","text":"that the systems of SEHK and market participants will function properly or will continue to be adapted","page_number":144,"box":{"x":116,"y":521,"width":757,"height":12}},{"id":"2541088d-9037-4139-91dd-7a0b1c57fd3a","block_type":"box","text":"to changes and developments in both markets. In the event that the relevant systems fail to function","page_number":144,"box":{"x":116,"y":537,"width":747,"height":12}},{"id":"d10ced3c-5422-46b6-b7f3-c5e9206a28a4","block_type":"box","text":"properly, trading in Stock Connect Securities through Stock Connects could be disrupted.","page_number":144,"box":{"x":117,"y":552,"width":667,"height":12}},{"id":"bb7655a8-9250-4889-b8c8-2f513c009a15","block_type":"box","text":"The Shanghai-Hong Kong Stock Connect program launched in November 2014 and the","page_number":144,"box":{"x":116,"y":583,"width":656,"height":12}},{"id":"16f2f47f-da60-4f7e-a87a-d000c915c156","block_type":"box","text":"Shenzhen-Hong Kong Stock Connect program launched in December 2016. Each program does not","page_number":144,"box":{"x":116,"y":599,"width":751,"height":12}},{"id":"a3997e57-3dbc-4828-bdb2-363a92014857","block_type":"box","text":"have an extensive operating history. New or revised regulations may be issued from time to time by the","page_number":144,"box":{"x":117,"y":614,"width":771,"height":12}},{"id":"b2e7e48e-9161-4d4c-acf6-7461fd6db95e","block_type":"box","text":"regulators and stock exchanges in China and Hong Kong in connection with operations, legal","page_number":144,"box":{"x":117,"y":630,"width":695,"height":12}},{"id":"3ce9b640-feaa-4963-96ad-ddc2cee59613","block_type":"box","text":"enforcement and cross-border trades under Stock Connects. In addition, there can be no assurance","page_number":144,"box":{"x":116,"y":645,"width":748,"height":11}},{"id":"28c28ae4-21e6-4840-b895-c2c5b435ad9f","block_type":"box","text":"that Stock Connect will not be discontinued. A Fund may be adversely affected as a result of such","page_number":144,"box":{"x":116,"y":661,"width":726,"height":12}},{"id":"59529da2-55db-4126-bd18-d5b481653c7f","block_type":"box","text":"changes. Furthermore, the securities regimes and legal systems of China and Hong Kong differ","page_number":144,"box":{"x":116,"y":676,"width":709,"height":12}},{"id":"7b226041-e74c-4a78-8de7-4d9d658e00ce","block_type":"box","text":"significantly and issues may arise from the differences on an on-going basis. In the event that the","page_number":144,"box":{"x":116,"y":692,"width":722,"height":12}},{"id":"daecfbae-0122-416e-b8d8-2cf0554d7ca7","block_type":"box","text":"relevant systems fail to function properly, trading in both markets through Stock Connects could be","page_number":144,"box":{"x":117,"y":707,"width":732,"height":12}},{"id":"e61129ca-5545-44d1-9b1c-3d156fdc24b1","block_type":"box","text":"disrupted and a Fund’s ability to achieve its investment objective may be adversely affected. In","page_number":144,"box":{"x":116,"y":723,"width":702,"height":12}},{"id":"c893ed00-2ef8-4b13-89a3-e30f28333fce","block_type":"box","text":"addition, a Fund’s investments in Stock Connect Securities through Stock Connects are generally","page_number":144,"box":{"x":116,"y":738,"width":724,"height":12}},{"id":"1c46a2a3-4182-44be-bea1-54d34e94b0e9","block_type":"box","text":"subject to Chinese securities regulations and listing rules, among other restrictions. Further, different","page_number":144,"box":{"x":116,"y":754,"width":746,"height":12}},{"id":"00af9799-5215-4afd-a09f-e622bef4d523","block_type":"box","text":"fees, costs and taxes are imposed on foreign investors acquiring Stock Connect Securities through","page_number":144,"box":{"x":116,"y":769,"width":733,"height":12}},{"id":"f0b95e4b-205d-40bc-8ba5-d48ab1366826","block_type":"box","text":"Stock Connects, and these fees, costs and taxes may be higher than comparable fees, costs and","page_number":144,"box":{"x":116,"y":785,"width":722,"height":12}},{"id":"63acd4ea-4f31-4636-8ad7-5aab11a3233b","block_type":"box","text":"taxes imposed on owners of other securities providing similar investment exposure.","page_number":144,"box":{"x":116,"y":800,"width":618,"height":12}},{"id":"f8703d63-0379-4fce-b3dc-1ce2c455dae2","block_type":"box","text":"Suspension Risk","page_number":144,"box":{"x":117,"y":831,"width":125,"height":12}},{"id":"022769f8-3315-4472-b756-9ed0c57efc16","block_type":"box","text":". SSE Securities and SZSE Securities may only be bought from, or sold to, a Fund at","page_number":144,"box":{"x":242,"y":831,"width":634,"height":12}},{"id":"5cd1f023-4f0b-4bc7-a58f-18a576108b6e","block_type":"box","text":"times when the relevant SSE Securities and SZSE Securities may be sold or purchased on the","page_number":144,"box":{"x":116,"y":847,"width":709,"height":12}},{"id":"9562c09c-44eb-4950-83e6-cb456927e332","block_type":"box","text":"relevant Chinese stock exchange. The SSE Securities and SZSE Securities markets have a higher","page_number":144,"box":{"x":117,"y":862,"width":738,"height":12}},{"id":"6252d5a2-6f2b-4e28-9a2c-8c7dc76d275b","block_type":"box","text":"propensity for trading suspensions than many other global equity markets. Each of the SEHK, SSE and","page_number":144,"box":{"x":117,"y":878,"width":771,"height":12}},{"id":"eb1e8215-01dc-492d-956e-8a2da8e70845","block_type":"box","text":"II-57","page_number":144,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"57d5220c-36b5-41a5-8b9b-39a40f8508dc","block_type":"box","text":"NM1026U-6004382-144/605","page_number":144,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"d5dabc61-ba1e-4067-92cb-589ae664d41e","block_type":"box","text":"SZSE reserves the right to suspend trading of SSE Securities and SZSE Securities purchased on the","page_number":145,"box":{"x":116,"y":87,"width":756,"height":12}},{"id":"674b8a40-758b-4a87-9e91-43c8001d706a","block_type":"box","text":"Stock Connects if necessary for ensuring an orderly and fair market and ensuring that risks are","page_number":145,"box":{"x":116,"y":102,"width":710,"height":13}},{"id":"08ae9b4b-74c9-4b74-880e-6ba610ebeb2a","block_type":"box","text":"managed prudently. Consent from the relevant regulator would be sought before a suspension of","page_number":145,"box":{"x":117,"y":118,"width":724,"height":12}},{"id":"508a9c65-2595-4188-ba27-e635545e3773","block_type":"box","text":"Northbound trading is triggered. The relevant PRC government authority may also impose “circuit","page_number":145,"box":{"x":117,"y":134,"width":727,"height":12}},{"id":"4ef16838-0e42-4151-9ba4-afb4b306763e","block_type":"box","text":"breakers” and other measures to halt or suspend Northbound trading. Where a suspension in the","page_number":145,"box":{"x":117,"y":149,"width":725,"height":12}},{"id":"8c56f4d6-dd77-4178-b039-404b0657c8bd","block_type":"box","text":"Northbound trading through Stock Connect is effected, the Fund’s ability to access the PRC market will","page_number":145,"box":{"x":117,"y":165,"width":769,"height":12}},{"id":"c4e735b6-437b-47d4-af2c-033a58f952e7","block_type":"box","text":"be adversely affected. Trading suspensions in certain stocks could lead to greater market execution","page_number":145,"box":{"x":117,"y":180,"width":745,"height":12}},{"id":"5495101e-cb89-4df7-9b05-52023e4c04a9","block_type":"box","text":"risk and costs for a Fund. The SSE and SZSE currently","page_number":145,"box":{"x":117,"y":196,"width":415,"height":12}},{"id":"fff8a1c0-ba93-4969-bf2b-da693ec29b2f","block_type":"box","text":"apply a daily price limit, generally set at 10%,","page_number":145,"box":{"x":533,"y":196,"width":340,"height":12}},{"id":"d69cb709-3fbf-4682-aaed-8d0abc74d6b5","block_type":"box","text":"of the amount of fluctuation permitted in the prices of the relevant SSE Securities and SZSE Securities","page_number":145,"box":{"x":116,"y":211,"width":766,"height":12}},{"id":"bf3769d8-2847-4e32-82cd-898d8fde5b50","block_type":"box","text":"during a single trading day. The daily price limit refers to price movements only and does not restrict","page_number":145,"box":{"x":116,"y":227,"width":747,"height":12}},{"id":"d58823cf-7d02-4cfb-a996-102d069487f8","block_type":"box","text":"trading within the relevant limit. There can be no assurance that a liquid market on an exchange will","page_number":145,"box":{"x":116,"y":242,"width":744,"height":12}},{"id":"38ad6170-3e63-4df3-8be4-330d3e83705c","block_type":"box","text":"exist for any particular SSE Security or SZSE Security or for any particular time.","page_number":145,"box":{"x":116,"y":258,"width":598,"height":12}},{"id":"d0283e1b-0b80-40df-92ae-b09d210846df","block_type":"box","text":"Risk of Investing in the China Interbank Bond Market through Bond Connect","page_number":145,"box":{"x":116,"y":289,"width":567,"height":12}},{"id":"731f43e9-0c69-489d-ba51-418884e6140a","block_type":"box","text":". A Fund may invest","page_number":145,"box":{"x":683,"y":289,"width":152,"height":12}},{"id":"c1769369-4974-46c7-b5fe-347ec6dee0ad","block_type":"box","text":"directly in the domestic bond market in the PRC (the “China Interbank Bond Market”) through the","page_number":145,"box":{"x":116,"y":304,"width":724,"height":12}},{"id":"db680362-0321-40d0-9616-abd59a24aa80","block_type":"box","text":"northbound trading of Bond Connect (“Bond Connect”). Bond Connect is an initiative launched in July","page_number":145,"box":{"x":117,"y":320,"width":755,"height":12}},{"id":"e87fdd6c-82bd-4afb-b234-3795941d679f","block_type":"box","text":"2017 for mutual bond market access between the PRC and Hong Kong, established by the China","page_number":145,"box":{"x":116,"y":335,"width":729,"height":12}},{"id":"d296ad66-3a9f-4480-9cf2-3b647bfa95ff","block_type":"box","text":"Foreign Exchange Trade System & National Interbank Funding Centre (“CFETS”), China Central","page_number":145,"box":{"x":117,"y":351,"width":722,"height":12}},{"id":"8747f649-3ecb-4c66-b0ff-24aecd4c636f","block_type":"box","text":"Depository & Clearing Co., Ltd (“CDCC”), Shanghai Clearing House (“SCH”), Hong Kong Exchanges","page_number":145,"box":{"x":117,"y":366,"width":752,"height":12}},{"id":"25ba1541-178a-48a0-81ab-6f3fa9aa306f","block_type":"box","text":"and Clearing Limited (“HKEX”) and Central Moneymarkets Unit (“CMU”). Under the prevailing","page_number":145,"box":{"x":116,"y":382,"width":699,"height":12}},{"id":"3997cf0a-8e78-4438-bbc6-9afe19c1c0ac","block_type":"box","text":"regulations in the PRC, eligible foreign investors are allowed to invest in the bonds circulated in the","page_number":145,"box":{"x":117,"y":397,"width":738,"height":12}},{"id":"4c1c1367-bb09-4728-93a1-e3a57b99c6fc","block_type":"box","text":"China Interbank Bond Market through Bond Connect. Eligible foreign investors may submit trade","page_number":145,"box":{"x":117,"y":413,"width":721,"height":12}},{"id":"aacd7b54-0c30-4b45-aa06-e1e3781decdc","block_type":"box","text":"requests for bonds circulated in the China Interbank Bond Market through offshore electronic bond","page_number":145,"box":{"x":117,"y":428,"width":735,"height":12}},{"id":"ab8ef9df-7427-4b1f-aad0-52d6744388eb","block_type":"box","text":"trading platforms (such as Tradeweb), which will in turn transmit their requests for quotation to CFETS.","page_number":145,"box":{"x":116,"y":444,"width":768,"height":12}},{"id":"c72a6820-afda-4b80-854d-8e3df0c3a245","block_type":"box","text":"CFETS will send the requests for quotation to a number of approved onshore dealers (including market","page_number":145,"box":{"x":117,"y":459,"width":770,"height":12}},{"id":"3de483fa-a454-4750-9561-de0c04ca5442","block_type":"box","text":"makers and others engaged in the market making business) in the PRC. The approved onshore","page_number":145,"box":{"x":117,"y":475,"width":715,"height":12}},{"id":"f15efd38-8d41-435e-a475-53652d0d661d","block_type":"box","text":"dealer(s) will respond to the requests for quotation via CFETS and CFETS will send their responses to","page_number":145,"box":{"x":116,"y":490,"width":765,"height":12}},{"id":"cc2bb931-065e-41f9-9806-4906ed431b3e","block_type":"box","text":"those eligible foreign investors through the same offshore electronic bond trading platforms. Once the","page_number":145,"box":{"x":116,"y":506,"width":759,"height":12}},{"id":"ac320d44-989f-4f0c-9674-acc01d26f695","block_type":"box","text":"eligible foreign investor accepts the quotation, the trade is concluded on CFETS.","page_number":145,"box":{"x":116,"y":521,"width":603,"height":12}},{"id":"0336bf5a-3460-4825-9313-58960524d238","block_type":"box","text":"The settlement and custody of bonds traded in the China Interbank Bond Market under Bond Connect","page_number":145,"box":{"x":116,"y":552,"width":761,"height":12}},{"id":"3829f52c-20bf-4703-98c9-456938134796","block_type":"box","text":"will be effected through the settlement and custody link between CMU, as an offshore custody agent,","page_number":145,"box":{"x":116,"y":568,"width":755,"height":12}},{"id":"40174cb8-6f80-49ab-9e8e-9d87424938f0","block_type":"box","text":"and CDCC and SCH, as onshore custodians and clearing institutions in the PRC. Under the settlement","page_number":145,"box":{"x":116,"y":583,"width":768,"height":12}},{"id":"2df1bf97-2b94-4360-9395-a26ebdde13be","block_type":"box","text":"link, CDCC or SCH will effect gross settlement of confirmed trades onshore and CMU will process","page_number":145,"box":{"x":117,"y":599,"width":730,"height":12}},{"id":"f23bd8f9-816e-413f-a1ec-31bbf99339b6","block_type":"box","text":"bond settlement instructions from CMU members on behalf of eligible foreign investors in accordance","page_number":145,"box":{"x":117,"y":614,"width":757,"height":12}},{"id":"ea8bd208-9e34-4365-bd3b-fde324cdb2de","block_type":"box","text":"with its relevant rules. Since the introduction in August 2018 of delivery versus payment (DVP)","page_number":145,"box":{"x":116,"y":630,"width":705,"height":12}},{"id":"eac92c1b-3742-4882-a07c-b88d21e85059","block_type":"box","text":"settlement in respect of Bond Connect, the movement of cash and securities is carried out","page_number":145,"box":{"x":116,"y":645,"width":675,"height":12}},{"id":"ef6df2f8-56ff-45b4-a454-d275e31dda52","block_type":"box","text":"simultaneously on a real-time basis. Pursuant to the prevailing regulations in the PRC, CMU, as the","page_number":145,"box":{"x":116,"y":661,"width":738,"height":12}},{"id":"f8481e05-927d-45ae-afaa-a30a70fe6074","block_type":"box","text":"offshore custody agent recognized by the Hong Kong Monetary Authority, will open omnibus nominee","page_number":145,"box":{"x":116,"y":676,"width":754,"height":12}},{"id":"51eadfd5-54d7-440d-9a22-933753e4f42f","block_type":"box","text":"accounts with the onshore custody agent recognized by the People’s Bank of China (i.e., CDCC and","page_number":145,"box":{"x":116,"y":692,"width":744,"height":12}},{"id":"ab620bf4-d6bc-4709-9ca2-3eb1a2a1d7a2","block_type":"box","text":"SCH). All bonds traded by eligible foreign investors through Bond Connect will be registered in the","page_number":145,"box":{"x":116,"y":707,"width":729,"height":12}},{"id":"880169ea-573f-4b42-91fd-d181e3e67209","block_type":"box","text":"name of CMU, which will hold such bonds as a nominee owner. Therefore, a Fund will be exposed to","page_number":145,"box":{"x":117,"y":723,"width":748,"height":12}},{"id":"fdeb2d14-0936-4dda-87c1-fee49a07a0cd","block_type":"box","text":"custody risks with respect to CMU. In the remote event of a CDCC or SCH default, CMU’s liabilities in","page_number":145,"box":{"x":116,"y":738,"width":754,"height":12}},{"id":"90b5a448-a45c-414a-80ca-708c1afa2fe1","block_type":"box","text":"Bond Connect bonds under its market contracts with clearing participants will be limited to assisting","page_number":145,"box":{"x":117,"y":754,"width":736,"height":12}},{"id":"468ba3cd-0896-46e8-ad26-344f9ce5f735","block_type":"box","text":"clearing participants in pursuing their claims against CDCC or SCH. The Fund may suffer delay in the","page_number":145,"box":{"x":116,"y":769,"width":753,"height":12}},{"id":"6194c81c-d104-4734-ac5a-4e7a54976fa3","block_type":"box","text":"recovery process or may not fully recover its losses from CDCC or SCH. In addition, as the relevant","page_number":145,"box":{"x":117,"y":785,"width":739,"height":12}},{"id":"b7c3e30e-d97c-4c6a-82d1-cddc27b8f03b","block_type":"box","text":"filings, registration with the People’s Bank of China, and account opening have to be carried out by","page_number":145,"box":{"x":116,"y":800,"width":733,"height":12}},{"id":"5a039087-99ff-4a0b-85fc-f4496ddcbf4e","block_type":"box","text":"third parties, including CMU, CDCC, SCH, and CFETS, a Fund is subject to the risks of default or","page_number":145,"box":{"x":116,"y":816,"width":723,"height":12}},{"id":"cc3cab23-dd34-4ef7-b1bf-0aca016f9c01","block_type":"box","text":"errors on the part of such third parties.","page_number":145,"box":{"x":116,"y":831,"width":290,"height":12}},{"id":"1ae11467-26d6-4f7a-9f3a-091d50e2d141","block_type":"box","text":"The precise nature and rights of a Fund as the beneficial owner of the bonds traded in the China","page_number":145,"box":{"x":116,"y":862,"width":720,"height":12}},{"id":"92615761-e938-4875-9ad5-05de79906f88","block_type":"box","text":"Interbank Bond Market through CMU as nominee is not well-defined under PRC law. There is a lack of","page_number":145,"box":{"x":117,"y":878,"width":765,"height":12}},{"id":"1a2fa0d5-2cfd-4dc1-9df9-bf3558704612","block_type":"box","text":"II-58","page_number":145,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"6eaefb0d-2a34-4754-9ffb-29ff227ff593","block_type":"box","text":"NM1026U-6004382-145/605","page_number":145,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"077bf3a1-490e-42f0-8a1a-3416feb71f8a","block_type":"box","text":"a clear definition of, and distinction between, legal ownership and beneficial ownership under PRC law","page_number":146,"box":{"x":116,"y":87,"width":765,"height":12}},{"id":"744f29a4-16e2-42d5-b9b6-97bdb52ee1c0","block_type":"box","text":"and there have been few cases involving a nominee account structure in the PRC courts. The exact","page_number":146,"box":{"x":116,"y":102,"width":745,"height":13}},{"id":"7f2a267d-fd95-4c40-83a1-560c5ffd534b","block_type":"box","text":"nature and methods of enforcement of the rights and interests of a Fund under PRC law are also","page_number":146,"box":{"x":117,"y":118,"width":722,"height":12}},{"id":"1d2de525-a6ac-42ec-a1d5-02db30e70b5c","block_type":"box","text":"uncertain.","page_number":146,"box":{"x":117,"y":134,"width":77,"height":9}},{"id":"07ff8a91-2744-47e2-a5db-eaee0d1f4444","block_type":"box","text":"Market volatility and potential lack of liquidity due to low trading volume of certain bonds in the China","page_number":146,"box":{"x":117,"y":164,"width":750,"height":12}},{"id":"97642ff9-e6a6-452c-b118-700ba9f37596","block_type":"box","text":"Interbank Bond Market may result in prices of certain bonds traded on such market fluctuating","page_number":146,"box":{"x":117,"y":179,"width":702,"height":12}},{"id":"c7dbfe36-614d-425d-a1f2-cbfd17cdceac","block_type":"box","text":"significantly. A Fund investing in such market is therefore subject to liquidity and volatility risks. The","page_number":146,"box":{"x":116,"y":194,"width":742,"height":12}},{"id":"dbd510bd-9e60-4264-8b29-2320a72abb0f","block_type":"box","text":"bid-ask spreads of the prices of such securities may be large, and a Fund may therefore incur","page_number":146,"box":{"x":117,"y":209,"width":700,"height":12}},{"id":"89cc5afe-88c7-4c42-a59a-d320aab6e91d","block_type":"box","text":"significant costs and may suffer losses when selling such investments. The bonds traded in the China","page_number":146,"box":{"x":116,"y":224,"width":759,"height":12}},{"id":"47fba83b-c7ad-4912-a3ac-0a07184d9b45","block_type":"box","text":"Interbank Bond Market may be difficult or impossible to sell, which may impact a Fund’s ability to","page_number":146,"box":{"x":117,"y":239,"width":722,"height":12}},{"id":"00156fe7-de2e-4d46-a18e-a04ea590dbfd","block_type":"box","text":"acquire or dispose of such securities at their expected prices.","page_number":146,"box":{"x":116,"y":254,"width":460,"height":12}},{"id":"7cc075c7-824a-4d93-b0ba-b2b35a7cfa70","block_type":"box","text":"Investing in the China Interbank Bond Market through Bond Connect is also subject to regulatory risks.","page_number":146,"box":{"x":117,"y":284,"width":766,"height":12}},{"id":"56109dbe-1941-4493-a6c3-cca1209003fa","block_type":"box","text":"The relevant rules and regulations are subject to change, which may have potential retrospective","page_number":146,"box":{"x":116,"y":299,"width":724,"height":12}},{"id":"2a476a83-5aae-4421-b1ea-e0263f4c83e3","block_type":"box","text":"effect, and there can be no assurance that Bond Connect will not be discontinued or abolished.","page_number":146,"box":{"x":116,"y":314,"width":711,"height":11}},{"id":"decab70e-6a55-44bd-a703-6e9803256e67","block_type":"box","text":"Furthermore, the securities regimes and legal systems of China and Hong Kong differ significantly and","page_number":146,"box":{"x":117,"y":329,"width":764,"height":12}},{"id":"3057ab59-bf82-44bf-9a67-2a83a24bfa78","block_type":"box","text":"issues may arise based on these differences. In the event that the relevant authorities suspend","page_number":146,"box":{"x":117,"y":344,"width":709,"height":12}},{"id":"aed21564-6b4b-4a13-a8fb-89bd3e3728a7","block_type":"box","text":"account opening or trading on the China Interbank Bond Market, a Fund’s ability to invest in the China","page_number":146,"box":{"x":116,"y":359,"width":762,"height":12}},{"id":"7fe448ea-db78-48be-806b-967d8f03384e","block_type":"box","text":"Interbank Bond Market will be adversely affected and limited. In such event, the Fund’s ability to","page_number":146,"box":{"x":117,"y":374,"width":716,"height":12}},{"id":"7da7538a-a32d-478e-a7db-274e0988fea6","block_type":"box","text":"achieve its investment objective will be negatively affected and, after exhausting other trading","page_number":146,"box":{"x":116,"y":389,"width":699,"height":12}},{"id":"1585675d-909e-41fb-bf07-032edac7dc00","block_type":"box","text":"alternatives, the Fund may suffer substantial losses as a result. Further, if Bond Connect is not","page_number":146,"box":{"x":116,"y":404,"width":707,"height":12}},{"id":"c13a00bd-aee6-4b0b-8823-875721128c66","block_type":"box","text":"operating, a Fund may not be able to acquire or dispose of bonds through Bond Connect in a timely","page_number":146,"box":{"x":116,"y":419,"width":745,"height":12}},{"id":"6d57320f-5aa5-4d2c-af68-fa336a0d5bea","block_type":"box","text":"manner, which could adversely affect the Fund’s performance.","page_number":146,"box":{"x":117,"y":434,"width":467,"height":12}},{"id":"25cb7d28-e6cd-4a5b-8602-0102a3b12ee0","block_type":"box","text":"Trading through Bond Connect is performed through newly developed trading platforms and","page_number":146,"box":{"x":116,"y":464,"width":687,"height":12}},{"id":"e8394061-3c38-467d-8d1f-e5fd59a55dec","block_type":"box","text":"operational systems. There is no assurance that such systems will function properly or will continue to","page_number":146,"box":{"x":116,"y":479,"width":761,"height":12}},{"id":"9c911a44-2bec-49fe-bc93-74940b8a8ebf","block_type":"box","text":"be adapted to changes and developments in the market. In the event that the relevant systems fail to","page_number":146,"box":{"x":117,"y":494,"width":753,"height":12}},{"id":"8ac897ea-a514-46b7-99ee-3a8fba95d190","block_type":"box","text":"function properly, trading through Bond Connect may be disrupted. A Fund’s ability to trade through","page_number":146,"box":{"x":116,"y":509,"width":744,"height":12}},{"id":"d705c28b-77f6-46e2-8ca8-7d8a14fc9a62","block_type":"box","text":"Bond Connect (and hence to pursue its investment strategy) may therefore be adversely affected. In","page_number":146,"box":{"x":117,"y":524,"width":749,"height":12}},{"id":"9854bd41-1006-48ef-a69a-3409bcb454fd","block_type":"box","text":"addition, where a Fund invests in the China Interbank Bond Market through Bond Connect, it may be","page_number":146,"box":{"x":116,"y":539,"width":753,"height":12}},{"id":"9a9038df-8471-4c1e-9b8a-4272700764bc","block_type":"box","text":"subject to risks of delays inherent in the order placing and/or settlement systems.","page_number":146,"box":{"x":116,"y":554,"width":607,"height":12}},{"id":"f6f0991b-4930-4270-a1fd-acad684360ee","block_type":"box","text":"Bond Connect trades are settled in Chinese currency, the RMB, which is currently restricted and not","page_number":146,"box":{"x":117,"y":584,"width":746,"height":12}},{"id":"ac1eef3b-2ada-4ebc-9009-d73c6f602147","block_type":"box","text":"freely convertible. As a result, a Fund will be exposed to currency risk, and it cannot be guaranteed","page_number":146,"box":{"x":116,"y":599,"width":740,"height":12}},{"id":"bb6d316c-a89a-4a0f-874c-8f4a9d8cdfe3","block_type":"box","text":"that investors will have timely access to a reliable supply of RMB.","page_number":146,"box":{"x":116,"y":614,"width":490,"height":12}},{"id":"526be013-69d6-4e14-8273-7287878a38e1","block_type":"box","text":"Tax Risk – Withholding Income Tax Risk.","page_number":146,"box":{"x":118,"y":645,"width":309,"height":12}},{"id":"25eaf98b-c8a6-41f4-b662-46ef493461c2","block_type":"box","text":"According to PRC tax regulations, a 10% withholding income tax is imposed on PRC sourced dividends","page_number":146,"box":{"x":116,"y":667,"width":760,"height":12}},{"id":"6af6ec48-33e5-4f50-bed6-a6559fcc7964","block_type":"box","text":"and interests from non-government bonds paid to a non-PRC tax resident enterprise, unless the rate is","page_number":146,"box":{"x":116,"y":682,"width":755,"height":12}},{"id":"14f4925e-5cf0-49c6-bd8c-0a34b8081c95","block_type":"box","text":"reduced under an applicable tax treaty. From a technical perspective, withholding income tax is also","page_number":146,"box":{"x":117,"y":697,"width":733,"height":12}},{"id":"593c9f3d-9e04-4b2f-b219-b430b6f11f76","block_type":"box","text":"applicable to capital gains realized by foreign investors on the disposal of PRC equity interests.","page_number":146,"box":{"x":116,"y":712,"width":697,"height":12}},{"id":"46aa1c87-98f6-4f9b-9e51-3d484070f663","block_type":"box","text":"There are however certain tax exemptions available, some temporary in nature, highlighted below.","page_number":146,"box":{"x":116,"y":742,"width":729,"height":12}},{"id":"fd135926-e471-4bc1-b252-c4fb9d8cb971","block_type":"box","text":"On November 14, 2014, the Ministry of Finance (“Mo","page_number":146,"box":{"x":116,"y":772,"width":375,"height":12}},{"id":"1d9df516-b11d-4c48-a3ef-c513c7543f82","block_type":"box","text":"F”), China Securities Regulatory Commission and the","page_number":146,"box":{"x":493,"y":772,"width":379,"height":12}},{"id":"66afb7de-eaf0-4fbb-81a0-a358a57600b8","block_type":"box","text":"State Taxation Administration (“STA”), acting with St","page_number":146,"box":{"x":116,"y":787,"width":372,"height":12}},{"id":"45e582d4-e68e-4254-9bcd-db7368c75e30","block_type":"box","text":"ate Council’s approval, jointly released Circular 79,","page_number":146,"box":{"x":489,"y":787,"width":359,"height":12}},{"id":"bfe9fb85-796b-4076-b779-c139f0600e79","block_type":"box","text":"which temporarily exempts Qualified Foreign Instit","page_number":146,"box":{"x":116,"y":802,"width":356,"height":12}},{"id":"be7a45ab-ecc4-431d-8002-cf9cce01fb10","block_type":"box","text":"utional Investors (“QFIIs”) and Renminbi Qualified","page_number":146,"box":{"x":473,"y":802,"width":352,"height":12}},{"id":"066c4c6b-62a2-4aa1-9207-34f3ae88af9e","block_type":"box","text":"Foreign Institutional Investors (“RQFIIs”) from tax on","page_number":146,"box":{"x":117,"y":817,"width":369,"height":12}},{"id":"2162a3e8-2159-49d1-89c4-d302bd2f005c","block_type":"box","text":"capital gains derived from the trading of shares and","page_number":146,"box":{"x":492,"y":817,"width":365,"height":12}},{"id":"cb726ebb-ed07-412a-8897-c1bf5a29f441","block_type":"box","text":"other equity interest investments on or after No","page_number":146,"box":{"x":116,"y":832,"width":334,"height":12}},{"id":"640db5fb-cba8-4d3d-a06e-8ce660d8996b","block_type":"box","text":"vember 17, 2014. Subsequently, Circulars 81 and 127 were","page_number":146,"box":{"x":450,"y":832,"width":429,"height":12}},{"id":"aeeed5de-1c4f-4578-a484-f513f13a464e","block_type":"box","text":"issued to temporarily exempt tax on capital gains der","page_number":146,"box":{"x":117,"y":847,"width":375,"height":12}},{"id":"c7076f4b-44bc-4bde-8302-d56f780b61b9","block_type":"box","text":"ived from trading of equity securities of companies","page_number":146,"box":{"x":493,"y":847,"width":361,"height":12}},{"id":"cede0d41-0c8e-4c80-b923-76140f692a25","block_type":"box","text":"domiciled in the PRC that trade on Chinese stock exchanges (“A-Shares”) through the Shanghai-Hong","page_number":146,"box":{"x":116,"y":862,"width":734,"height":12}},{"id":"becd9db4-2b42-4b64-8154-083aa0579f1d","block_type":"box","text":"Kong Stock Connect program or the Shenzhen-Hong Kong Stock Connect program, as applicable (each, a","page_number":146,"box":{"x":117,"y":877,"width":764,"height":12}},{"id":"57c7e6a1-571a-4579-abc2-bdd2eabd7b15","block_type":"box","text":"II-59","page_number":146,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"b4b8b66b-768d-49e0-b547-f3118809f6e4","block_type":"box","text":"NM1026U-6004382-146/605","page_number":146,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"dd0cffed-4ee1-47e5-a750-5d7ce62014b6","block_type":"box","text":"“Stock Connect” and collectively, “Stock Connects”). The dur","page_number":147,"box":{"x":116,"y":86,"width":431,"height":13}},{"id":"744f6855-c701-4085-b007-1888ab5f0bed","block_type":"box","text":"ation of the temporary exemptions is not stated","page_number":147,"box":{"x":548,"y":86,"width":338,"height":13}},{"id":"f55af09a-563a-4f63-96ec-ee46f86a0292","block_type":"box","text":"in the circulars and is subject to termination by","page_number":147,"box":{"x":117,"y":102,"width":328,"height":12}},{"id":"73e4eca4-4b13-4a47-b6f6-38b6c50e37fa","block_type":"box","text":"the PRC tax authorities w","page_number":147,"box":{"x":445,"y":101,"width":175,"height":10}},{"id":"eda55b3c-2f24-41f8-ab58-bcf624a80a26","block_type":"box","text":"with or without notice.","page_number":147,"box":{"x":620,"y":102,"width":159,"height":9}},{"id":"cb7178d9-93d7-43a3-97c2-3283ee4d3707","block_type":"box","text":"On November 22, 2018, the MoF and STA jointly issued Circular 108 which states that foreign institutional","page_number":147,"box":{"x":116,"y":133,"width":766,"height":12}},{"id":"f80c5547-d490-4150-a445-078b8f01a2b1","block_type":"box","text":"investors are temporarily exempt from withholding income tax with respect to interest income on bonds","page_number":147,"box":{"x":117,"y":148,"width":742,"height":12}},{"id":"4e7c67b4-9328-4fea-9e0a-3446f30ce2fb","block_type":"box","text":"derived from the PRC bond market from November 7, 2018 to November 6, 2021. On November 22,","page_number":147,"box":{"x":116,"y":163,"width":727,"height":11}},{"id":"dc15a23a-250d-44b8-aa9b-98c054d7181f","block_type":"box","text":"2021, the MoF and STA issued Public Notice 34 to extend the temporary exemption from November 7,","page_number":147,"box":{"x":116,"y":178,"width":743,"height":12}},{"id":"93bb00a6-25c6-4d15-9d2e-fd12cc820c8f","block_type":"box","text":"2021 to December 31, 2025. On January 15, 2026, it was announced via Public Notice No. 5 of 2026 that","page_number":147,"box":{"x":116,"y":193,"width":762,"height":12}},{"id":"2a0ecd35-2e42-4296-92ff-864169e24838","block_type":"box","text":"the exemption was extended through December 31, 2027.","page_number":147,"box":{"x":116,"y":208,"width":424,"height":12}},{"id":"ffb9d872-1582-4dc6-879d-83a81e08eb9a","block_type":"box","text":"Value Added Tax (“VAT”) Risk","page_number":147,"box":{"x":118,"y":239,"width":225,"height":13}},{"id":"4225fa9b-7bd2-40bf-8bd8-d837ae15e9d1","block_type":"box","text":"k — From May 1, 2016, VAT applies to certain income derived by the","page_number":147,"box":{"x":342,"y":240,"width":511,"height":12}},{"id":"5e37564a-0b93-422d-8c39-55ff2af80b9d","block_type":"box","text":"Fund, including PRC sourced interest income on non-government bonds and trading gains.","page_number":147,"box":{"x":117,"y":255,"width":681,"height":12}},{"id":"a256c970-5e05-4bde-8a54-5414503a05b2","block_type":"box","text":"There are however certain tax exemptions available, some temporary in nature, highlighted below.","page_number":147,"box":{"x":116,"y":286,"width":735,"height":12}},{"id":"758d5bd0-1c31-4cfd-a6a1-d81ebef6ca20","block_type":"box","text":"VAT exemptions currently apply to capital gains from trading of QFII and RQFII products, A-Shares","page_number":147,"box":{"x":116,"y":317,"width":741,"height":13}},{"id":"2af79e87-346b-41ea-8900-46fbc16b01dc","block_type":"box","text":"traded on the Stock Connects and debt securities traded in the China Interbank Bond Market.","page_number":147,"box":{"x":116,"y":332,"width":699,"height":10}},{"id":"d822df06-9678-4357-935d-f8e466a28585","block_type":"box","text":"On November 7, 2018, the MoF and STA jointly issued Circular 108 which states that foreign","page_number":147,"box":{"x":116,"y":364,"width":694,"height":12}},{"id":"1024a0aa-e3d8-469c-9246-cb9238dc3a43","block_type":"box","text":"institutional investors are temporarily exempt from VAT with respect to interest income on bonds","page_number":147,"box":{"x":117,"y":379,"width":718,"height":12}},{"id":"68184e90-4392-4fab-9ec8-a88965435aa5","block_type":"box","text":"derived from the PRC bond market from November 7, 2018 to November 6, 2021. On November 22,","page_number":147,"box":{"x":116,"y":394,"width":750,"height":11}},{"id":"4c8552ee-84c0-457d-b613-3d8bcd6b8ab2","block_type":"box","text":"2021, the MoF and STA jointly issued Public Notice 34 to extend the temporary exemption from","page_number":147,"box":{"x":116,"y":409,"width":714,"height":12}},{"id":"52de7425-fb5e-4ee2-a2e2-aaec65343353","block_type":"box","text":"November 7, 2021 to December 31, 2025. However, on July 31, 2025, the MoF and STA jointly issued","page_number":147,"box":{"x":117,"y":424,"width":764,"height":12}},{"id":"c080d56e-8b4b-4d3a-928c-6eaa79eaa989","block_type":"box","text":"Public Notice No 4 of 2025, stating that VAT will apply with respect to interest income derived from","page_number":147,"box":{"x":117,"y":439,"width":735,"height":12}},{"id":"ca8b0a15-b44a-461a-95f6-63d3a3652336","block_type":"box","text":"treasury bonds, local government bonds and financial bonds issued on or after August 8, 2025. It is","page_number":147,"box":{"x":116,"y":454,"width":742,"height":12}},{"id":"f06b0986-bdf7-4f06-987e-747570ca5fe5","block_type":"box","text":"understood that Public Notice No 4 of 2025 does not supersede the afore-mentioned exemption for","page_number":147,"box":{"x":117,"y":469,"width":739,"height":12}},{"id":"c93a6bca-4db1-438b-896d-354c69798680","block_type":"box","text":"foreign institutional investors. This exemption was extended through December 31, 2027.","page_number":147,"box":{"x":116,"y":484,"width":668,"height":12}},{"id":"aea0e974-8499-4cab-8e0d-4c1cd068d4fd","block_type":"box","text":"Any changes in PRC tax law, future clarifications thereof, and/or subsequent retroactive enforcement","page_number":147,"box":{"x":116,"y":515,"width":754,"height":12}},{"id":"94516d2b-4513-4d56-b9bb-34503fddbede","block_type":"box","text":"by the PRC tax authorities may result in a loss which could be material to the Fund. There is a risk the","page_number":147,"box":{"x":117,"y":530,"width":761,"height":12}},{"id":"f3dcd96b-2fe0-41a7-9c50-5c44f6e62833","block_type":"box","text":"PRC tax authorities may withdraw the temporary tax exemptions in the future and seek to collect taxes","page_number":147,"box":{"x":117,"y":545,"width":765,"height":12}},{"id":"70d645b6-5d55-4adb-8fe4-3c06574305d1","block_type":"box","text":"realized on the sale of A-Shares or PRC sourced interest income on non-government bonds received","page_number":147,"box":{"x":117,"y":560,"width":756,"height":12}},{"id":"df8cc592-cb3d-4d7b-8559-92b90a83aa48","block_type":"box","text":"by the Fund without giving any prior notice. If the temporary tax exemptions are withdrawn, any taxes","page_number":147,"box":{"x":117,"y":575,"width":755,"height":12}},{"id":"5b67baca-1c20-4af9-b3e7-aa05150b4a80","block_type":"box","text":"may be directly borne by or indirectly passed on to the Fund and may result in a substantial impact to","page_number":147,"box":{"x":117,"y":590,"width":755,"height":12}},{"id":"1d0ab04f-0fed-4aac-a6ed-58e7c398342c","block_type":"box","text":"its net asset value. As with any net asset value adjustment, investors may be advantaged or","page_number":147,"box":{"x":117,"y":605,"width":687,"height":12}},{"id":"305ee51c-8761-4f2c-b8b7-548f7b592dd1","block_type":"box","text":"disadvantaged depending on when the investors purchased and/or sold the shares of the Fund. There","page_number":147,"box":{"x":116,"y":620,"width":763,"height":12}},{"id":"e58858df-5daa-420f-90fc-29620fd6d8bc","block_type":"box","text":"will be no retrospective restatement of the Fund’s net asset value.","page_number":147,"box":{"x":116,"y":635,"width":494,"height":12}},{"id":"25ea9158-e49a-4c6f-affe-5fa8cf57fbb7","block_type":"box","text":"BlackRock will keep the provisioning policy for tax liability under review and may, in its discretion from","page_number":147,"box":{"x":117,"y":666,"width":752,"height":12}},{"id":"87c2b33d-0351-42b5-8a63-b26d220dd0be","block_type":"box","text":"time to time, make a provision for potential tax liabilities if in its opinion such provision is warranted or","page_number":147,"box":{"x":116,"y":681,"width":751,"height":12}},{"id":"27a130f8-aa75-4dd7-b14d-08e05690abc2","block_type":"box","text":"as further clarified by the PRC in notifications.","page_number":147,"box":{"x":116,"y":696,"width":339,"height":12}},{"id":"4d9cf308-e0c6-4220-8620-7e3d0450bd96","block_type":"box","text":"Investment in Other Investment Companies.","page_number":147,"box":{"x":116,"y":727,"width":350,"height":12}},{"id":"1ffb3129-0c7c-4316-840e-f4906abdce7d","block_type":"box","text":"Each Fund may, subject to applicable law, invest in","page_number":147,"box":{"x":474,"y":727,"width":378,"height":12}},{"id":"1a4abc7e-5996-4eb6-a0a8-24e697473b2b","block_type":"box","text":"other investment companies (including investment companies managed by BlackRock and its","page_number":147,"box":{"x":116,"y":742,"width":694,"height":12}},{"id":"0d363d4e-2680-4929-a047-a966c1e82306","block_type":"box","text":"affiliates), including money market funds and ETFs, which are typically open-end funds or unit","page_number":147,"box":{"x":116,"y":757,"width":697,"height":12}},{"id":"cfdfedf5-6827-4c2b-b3d8-04997e2a371f","block_type":"box","text":"investment trusts listed on a stock exchange. Under Section 12(d)(1)(A) of the Investment Company","page_number":147,"box":{"x":117,"y":772,"width":743,"height":12}},{"id":"bc6a1bf4-c29d-45a2-a8a8-bc05d8d02968","block_type":"box","text":"Act, however, a Fund may invest up to 10% of its total assets in securities of other investment","page_number":147,"box":{"x":116,"y":787,"width":696,"height":12}},{"id":"dd9bd6bf-75e8-48e4-b5b1-8790d65b7a85","block_type":"box","text":"companies (measured at the time of such investment). In addition, under Section 12(d)(1)(A) of the","page_number":147,"box":{"x":116,"y":802,"width":734,"height":12}},{"id":"0e2cc37d-4f37-4305-a617-ac9fc4ecbf54","block_type":"box","text":"Investment Company Act a Fund may not acquire securities of an investment company if such","page_number":147,"box":{"x":117,"y":817,"width":698,"height":12}},{"id":"4d1d6c77-69e3-4788-a2b7-69ce94036cb4","block_type":"box","text":"acquisition would cause the Fund to own more than 3% of the total outstanding voting stock of such","page_number":147,"box":{"x":116,"y":832,"width":745,"height":12}},{"id":"e902f66f-0054-4b59-ab3f-94ac6f04f937","block_type":"box","text":"investment company and a Fund may not invest in another investment company if such investment","page_number":147,"box":{"x":117,"y":847,"width":739,"height":12}},{"id":"737e9bd5-f404-49e1-b023-4d710eba8941","block_type":"box","text":"would cause more than 5% of the value of the Fund’s total assets to be invested in securities of such","page_number":147,"box":{"x":116,"y":862,"width":753,"height":10}},{"id":"43718b1b-c7b9-4b10-89f3-efdebbf681b3","block_type":"box","text":"investment company. (These limits do not restrict a Feeder Fund from investing all of its assets in","page_number":147,"box":{"x":117,"y":877,"width":727,"height":12}},{"id":"1a9b4770-a4d9-4ebe-bf3c-5b9b56dd02ae","block_type":"box","text":"II-60","page_number":147,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"f235cab3-76c3-496c-824a-d89d1e2840b6","block_type":"box","text":"NM1026U-6004382-147/605","page_number":147,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"1cf7b3a5-253b-4a8a-83c8-bdacbb2e6940","block_type":"box","text":"shares of its Master Portfolio.) In addition to the restrictions on investing in other investment companies","page_number":148,"box":{"x":116,"y":86,"width":771,"height":13}},{"id":"1482b627-dc93-45aa-bb45-02f9423bc0b0","block_type":"box","text":"discussed above, under Section 12(d)(1)(C) of the Investment Company Act a Fund may not invest in","page_number":148,"box":{"x":116,"y":101,"width":759,"height":13}},{"id":"66dd9ba6-1447-4bc8-b1c0-1b49cdeacf26","block_type":"box","text":"a registered closed-end investment company if such investment would cause the Fund and other","page_number":148,"box":{"x":116,"y":116,"width":724,"height":13}},{"id":"15113dfd-6370-4ef2-83cb-f1a4a3ad6fef","block_type":"box","text":"BlackRock-advised investment companies to own more than 10% of the total outstanding voting stock","page_number":148,"box":{"x":117,"y":131,"width":760,"height":13}},{"id":"53f755a8-c079-442f-a228-8ed2cb81d4dd","block_type":"box","text":"of such closed-end investment company. Pursuant to Section 12(d)(1)(G) of the Investment Company","page_number":148,"box":{"x":116,"y":146,"width":761,"height":13}},{"id":"79ea8e1e-4d60-4a45-a57c-fca2e28c3aef","block_type":"box","text":"Act, these percentage limitations do not apply to investments in affiliated investment companies,","page_number":148,"box":{"x":116,"y":161,"width":719,"height":13}},{"id":"11a04856-6a87-480c-b344-81bcf8da8d89","block_type":"box","text":"including ETFs, subject to certain conditions. In addition, a Fund may be able to rely on certain rules","page_number":148,"box":{"x":117,"y":177,"width":747,"height":12}},{"id":"842828af-c73f-4706-b9a8-0001967f324a","block_type":"box","text":"under the Investment Company Act to invest in shares of money market funds or other investment","page_number":148,"box":{"x":117,"y":191,"width":733,"height":12}},{"id":"665627c4-61a0-4b6f-95d8-ff66271a8d48","block_type":"box","text":"companies beyond the statutory limits noted above, but subject to certain conditions.","page_number":148,"box":{"x":116,"y":207,"width":633,"height":11}},{"id":"f0c5da3e-c1fc-4de5-a7d6-833f0bdff369","block_type":"box","text":"As with other investments, investments in other investment companies are subject to market and","page_number":148,"box":{"x":116,"y":238,"width":723,"height":11}},{"id":"a148c064-4248-43c3-b1c7-1e8a86a856b6","block_type":"box","text":"selection risk.","page_number":148,"box":{"x":116,"y":253,"width":106,"height":9}},{"id":"12e40434-8df4-4446-882d-1d696be166a1","block_type":"box","text":"Shares of investment companies, such as closed-end fund investment companies, that trade on an","page_number":148,"box":{"x":116,"y":284,"width":740,"height":12}},{"id":"43eaf914-9110-458a-97c9-ff18fa638ce6","block_type":"box","text":"exchange may at times be acquired at market prices representing premiums to their NAVs. In addition,","page_number":148,"box":{"x":116,"y":300,"width":767,"height":12}},{"id":"374bd7fa-9f37-4518-94f6-d58044e32b53","block_type":"box","text":"investment companies held by a Fund that trade on an exchange could trade at a discount from NAV,","page_number":148,"box":{"x":117,"y":315,"width":758,"height":12}},{"id":"869428d9-20b0-40d7-bbc8-ad000b662939","block_type":"box","text":"and such discount could increase while the Fund holds the shares. If the market price of shares of an","page_number":148,"box":{"x":116,"y":330,"width":756,"height":12}},{"id":"da1c4779-4519-48a8-a702-ebbf8c1ee94d","block_type":"box","text":"exchange-traded investment company decreases below the price that the Fund paid for the shares and","page_number":148,"box":{"x":116,"y":346,"width":771,"height":12}},{"id":"9f959dad-4238-4631-b969-821583112641","block_type":"box","text":"the Fund were to sell its shares of such investment company at a time when the market price is lower","page_number":148,"box":{"x":116,"y":361,"width":757,"height":13}},{"id":"dfb567d0-c436-41cd-b8dc-d4c9987e09eb","block_type":"box","text":"than the price at which it purchased the shares, the Fund would experience a loss.","page_number":148,"box":{"x":116,"y":377,"width":617,"height":12}},{"id":"5793a1a7-0285-4c46-bb85-b8d932f474f4","block_type":"box","text":"In addition, if a Fund acquires shares in investment companies, including affiliated investment","page_number":148,"box":{"x":117,"y":408,"width":698,"height":12}},{"id":"ca3a492d-a871-43d6-88ae-3d50e5f3cf16","block_type":"box","text":"companies, shareholders would bear both their proportionate share of expenses in the Fund and,","page_number":148,"box":{"x":116,"y":423,"width":727,"height":12}},{"id":"2d3c9467-f301-4498-8df5-08ea6dc4b3ce","block_type":"box","text":"indirectly, the expenses of such investment companies. Such expenses, both at the Fund level and","page_number":148,"box":{"x":117,"y":439,"width":739,"height":12}},{"id":"26a9d638-3efc-4b06-af45-39cecd838e70","block_type":"box","text":"acquired investment company level, would include management and advisory fees, unless such fees","page_number":148,"box":{"x":116,"y":454,"width":753,"height":13}},{"id":"d4d34e6b-54e6-4034-a722-e254c117f09e","block_type":"box","text":"have been waived by BlackRock. Please see the relevant Fund’s Prospectus to determine whether any","page_number":148,"box":{"x":117,"y":470,"width":769,"height":12}},{"id":"28b8b6be-2bce-4e0c-835e-c26eebd624ba","block_type":"box","text":"such management and advisory fees have been waived by BlackRock. Investments by a Fund in","page_number":148,"box":{"x":116,"y":485,"width":724,"height":13}},{"id":"7f0cde37-b31a-4c7c-8cb9-0a393083e232","block_type":"box","text":"wholly owned investment entities created under the laws of certain countries will not be deemed an","page_number":148,"box":{"x":116,"y":501,"width":740,"height":12}},{"id":"7aa63505-4317-4393-a382-2ffd5d6084bf","block_type":"box","text":"investment in other investment companies. Pursuant to guidance issued by the staff of the","page_number":148,"box":{"x":117,"y":516,"width":674,"height":13}},{"id":"1e1d5906-acb2-4d5c-8d9f-c25705677861","block_type":"box","text":"Commission, fees and expenses of money market funds used for the investment of cash collateral","page_number":148,"box":{"x":117,"y":532,"width":733,"height":12}},{"id":"737039fd-6b98-46b6-9657-d09ce4d01936","block_type":"box","text":"received in connection with loans of Fund securities are not treated as “acquired fund fees and","page_number":148,"box":{"x":117,"y":547,"width":706,"height":12}},{"id":"b9f5203b-4aab-45ad-b68e-447a82e83e76","block_type":"box","text":"expenses,” which are fees and expenses charged by other investment companies and pooled","page_number":148,"box":{"x":116,"y":563,"width":701,"height":12}},{"id":"a7fee96c-c22a-4cf4-be6a-66368dfe00e4","block_type":"box","text":"investment vehicles in which a Fund invests a portion of its assets.","page_number":148,"box":{"x":117,"y":578,"width":498,"height":12}},{"id":"77e3db52-8991-4297-b54f-ac32995dda29","block_type":"box","text":"To the extent shares of a Fund are held by another f","page_number":148,"box":{"x":116,"y":609,"width":380,"height":13}},{"id":"21fb4a92-bcc5-413c-826f-babc6b9efb5f","block_type":"box","text":"und, the ability of the Fund it","page_number":148,"box":{"x":497,"y":609,"width":205,"height":13}},{"id":"84abf6de-54df-4887-bde9-7059e8f9ee51","block_type":"box","text":"self to purchase other","page_number":148,"box":{"x":702,"y":609,"width":163,"height":12}},{"id":"572e071c-e1c3-4c9e-8a37-2dfe928f8c7c","block_type":"box","text":"funds may be limited. In addition, a fund-of-funds (","page_number":148,"box":{"x":116,"y":625,"width":365,"height":12}},{"id":"59706426-3e62-4062-a466-d06aa02d5b4a","block_type":"box","text":"e.g.","page_number":148,"box":{"x":482,"y":628,"width":25,"height":9}},{"id":"81fd7a5e-2646-4316-9689-9bf3419d7f8d","block_type":"box","text":", an investment company that seeks to meet its","page_number":148,"box":{"x":510,"y":625,"width":347,"height":12}},{"id":"ab25d1c0-2988-4630-a4ba-c0816cd046f9","block_type":"box","text":"investment objective by investing significantly in","page_number":148,"box":{"x":117,"y":640,"width":350,"height":13}},{"id":"e096ac9d-464a-4f0e-8285-f12ead333a3c","block_type":"box","text":"other investment companies)","page_number":148,"box":{"x":468,"y":640,"width":215,"height":13}},{"id":"6dce7fbe-9c96-4988-9dfc-1f9202316f12","block_type":"box","text":"may be limited in its ability","page_number":148,"box":{"x":684,"y":641,"width":195,"height":12}},{"id":"998b3639-3ee3-485b-bf76-ec089c1fc6d5","block_type":"box","text":"to purchase underlying funds if such underlying f","page_number":148,"box":{"x":116,"y":656,"width":353,"height":12}},{"id":"c25bef91-f5e7-4bee-9f64-53cc839369ee","block_type":"box","text":"unds themselves own shares of underlying funds.","page_number":148,"box":{"x":470,"y":656,"width":364,"height":12}},{"id":"33e25960-afcf-4bd7-8349-bcec1df866e7","block_type":"box","text":"A number of publicly traded closed-end investment companies have been organized to facilitate","page_number":148,"box":{"x":116,"y":687,"width":710,"height":12}},{"id":"0e939167-4eb4-45c9-a282-1181d142b039","block_type":"box","text":"indirect foreign investment in developing countries, and certain of such countries, such as Thailand,","page_number":148,"box":{"x":117,"y":702,"width":736,"height":13}},{"id":"cbb5473f-66c2-40da-b8da-9d174b0559a9","block_type":"box","text":"South Korea, Chile and Brazil, have specifically authorized such funds. There also are investment","page_number":148,"box":{"x":116,"y":718,"width":725,"height":12}},{"id":"bb00e273-47a9-47b6-9ef7-4892234afd03","block_type":"box","text":"opportunities in certain of such countries in pooled vehicles that resemble open-end investment","page_number":148,"box":{"x":116,"y":734,"width":708,"height":11}},{"id":"b0736ab9-a89d-4f8b-8cac-30645780fabd","block_type":"box","text":"companies. The restrictions on investments in securities of investment companies set forth above may","page_number":148,"box":{"x":116,"y":749,"width":760,"height":12}},{"id":"50bc74bc-1fa2-4d66-ab5f-e632f29b8760","block_type":"box","text":"limit opportunities for a Fund to invest indirectly in certain developing countries.","page_number":148,"box":{"x":117,"y":765,"width":585,"height":12}},{"id":"512cd799-0c12-445f-a201-10d1685f4025","block_type":"box","text":"Issuer Insolvency Risk.","page_number":148,"box":{"x":116,"y":796,"width":185,"height":12}},{"id":"2751738a-44a0-4529-b351-fa3f23c212ab","block_type":"box","text":"Certain Funds’ potential exposure to financially or operationally troubled","page_number":148,"box":{"x":307,"y":796,"width":532,"height":12}},{"id":"7e4690d4-0557-4741-81bc-3762879b0867","block_type":"box","text":"issuers involves a high degree of credit and market risk, which may be heightened during an economic","page_number":148,"box":{"x":117,"y":811,"width":761,"height":12}},{"id":"55f44641-711b-4d5e-93fc-aa022caf2ffc","block_type":"box","text":"downturn or recession. Should an issuer of securities held by a Fund become involved in a bankruptcy","page_number":148,"box":{"x":116,"y":827,"width":765,"height":12}},{"id":"0890c861-ff5f-4b73-8e91-e3c934a9123c","block_type":"box","text":"proceeding, reorganization or financial restructuring, a wide variety of considerations make an","page_number":148,"box":{"x":117,"y":842,"width":700,"height":12}},{"id":"0807c87c-f806-458a-98a5-284e497eb306","block_type":"box","text":"evaluation of the outcome of the Fund’s exposure to the issuer uncertain.","page_number":148,"box":{"x":116,"y":858,"width":548,"height":12}},{"id":"b993f6f2-9343-41c3-be35-cb4f25a5b15e","block_type":"box","text":"II-61","page_number":148,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"7f2c06e1-c7a9-46e7-8625-452814cc335b","block_type":"box","text":"NM1026U-6004382-148/605","page_number":148,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"d863c9da-e08b-4de7-bb1f-8ac7f38b3539","block_type":"box","text":"During the period of a bankruptcy proceeding, reorganization or financial restructuring, it is unlikely that","page_number":149,"box":{"x":117,"y":87,"width":769,"height":12}},{"id":"3d005573-3862-4d4f-b6cd-b6466f1abacc","block_type":"box","text":"a Fund will receive any interest payments on the securities of the issuer. A Fund will be subject to","page_number":149,"box":{"x":116,"y":102,"width":728,"height":13}},{"id":"c7500680-32c7-476e-9aeb-c3ff7cd0868d","block_type":"box","text":"significant uncertainty as to whether the reorganization or restructuring will be completed, and the Fund","page_number":149,"box":{"x":116,"y":118,"width":772,"height":12}},{"id":"bd8a2579-d2d0-4daa-98c1-6c595bb08883","block_type":"box","text":"may bear certain extraordinary expenses to protect and recover its investment. A Fund will also be","page_number":149,"box":{"x":117,"y":134,"width":735,"height":12}},{"id":"1f1a1627-9b75-4092-8990-7ab32891f8ad","block_type":"box","text":"subject to significant uncertainty as to when and in what manner and for what value the obligations","page_number":149,"box":{"x":116,"y":149,"width":737,"height":12}},{"id":"6c5a163e-eeb8-42a8-a704-fc282c18a10e","block_type":"box","text":"evidenced by the securities of the issuer held by the Fund will eventually be satisfied.","page_number":149,"box":{"x":116,"y":165,"width":637,"height":12}},{"id":"19607dc9-4242-453f-b263-6b17e0459740","block_type":"box","text":"Even if a plan of reorganization or restructuring is adopted with respect to the securities of the issuer","page_number":149,"box":{"x":117,"y":196,"width":741,"height":12}},{"id":"7a60d608-845e-4166-a104-4ffe9b3f016e","block_type":"box","text":"held by the Fund, there can be no assurance that the securities or other assets received by a Fund in","page_number":149,"box":{"x":117,"y":211,"width":748,"height":12}},{"id":"6e662f1f-551b-4cbf-929d-75e31be72cb0","block_type":"box","text":"connection with such plan of reorganization or restructuring will not have a lower value or income","page_number":149,"box":{"x":116,"y":227,"width":717,"height":12}},{"id":"3f6cf7a1-df78-40a5-b1a5-954872f6c208","block_type":"box","text":"potential than may have been anticipated or no value. A Fund may be unable to enforce its claims or","page_number":149,"box":{"x":117,"y":242,"width":742,"height":12}},{"id":"d10749f6-8141-46c2-b5be-dd7447b9abfd","block_type":"box","text":"rights in any collateral or may have its claims or security interest in any collateral challenged, disallowed","page_number":149,"box":{"x":117,"y":258,"width":767,"height":12}},{"id":"90131c10-0d17-495d-9712-be89761e8ac7","block_type":"box","text":"or subordinated to the claims or security interests of other creditors. In addition, amendments to the U.S.","page_number":149,"box":{"x":116,"y":273,"width":772,"height":12}},{"id":"6f0c2ae8-49e1-4a06-9c39-59fd424c90d6","block_type":"box","text":"Bankruptcy Code or other relevant laws could alter the expected outcome or introduce greater","page_number":149,"box":{"x":117,"y":289,"width":695,"height":12}},{"id":"222329a0-301c-418f-8a0c-572eed36f039","block_type":"box","text":"uncertainty regarding the outcome of the Fund’s securities holdings in the issuer. In a bankruptcy","page_number":149,"box":{"x":117,"y":304,"width":716,"height":12}},{"id":"493870d1-5929-4e86-a48c-df049368e6b4","block_type":"box","text":"proceeding, a reorganization or restructuring, the securities of the issuer held by a Fund could be","page_number":149,"box":{"x":117,"y":320,"width":716,"height":12}},{"id":"b7782ac7-3814-4ada-9910-f4f3300c57ba","block_type":"box","text":"re-characterized or a Fund may receive different securities or other assets, including equity securities.","page_number":149,"box":{"x":117,"y":335,"width":752,"height":12}},{"id":"0b3738f2-a983-4adc-9ebe-1626a73f64ae","block_type":"box","text":"These types of equity securities include, but are not limited to: common stock; preferred stock (including","page_number":149,"box":{"x":116,"y":351,"width":768,"height":12}},{"id":"0e48e876-dc6c-49f7-9abc-dea8d6821cd7","block_type":"box","text":"convertible preferred stock); bonds, notes and debentures convertible into common or preferred stock;","page_number":149,"box":{"x":116,"y":366,"width":756,"height":12}},{"id":"d2d69ad4-c7a4-45fe-a24c-52b56ee579ea","block_type":"box","text":"stock purchase warrants and rights; equity interests in trusts; and depositary receipts. Equity securities","page_number":149,"box":{"x":116,"y":382,"width":759,"height":12}},{"id":"f5a669f7-adc5-4b51-995e-0a97ab524b4a","block_type":"box","text":"are subject to changes in value, and their value may be more volatile than those of other asset classes.","page_number":149,"box":{"x":116,"y":397,"width":764,"height":12}},{"id":"d6672e34-04f1-48a2-aa6a-177af6eaa803","block_type":"box","text":"Holders of equity securities are subject to more risk than holders of debt securities because the status of","page_number":149,"box":{"x":117,"y":413,"width":771,"height":12}},{"id":"4f941d27-2df8-402a-9008-4777c5c26074","block_type":"box","text":"equity holders is subordinate to debtholders in an issuer’s capital structure. The value of equity","page_number":149,"box":{"x":116,"y":428,"width":701,"height":12}},{"id":"5d0d32cf-05b4-4f40-9231-e9f9ea48f3d1","block_type":"box","text":"securities received by a Fund could decline if the financial condition of the issuer deteriorates or if","page_number":149,"box":{"x":116,"y":444,"width":721,"height":12}},{"id":"7d185d66-4706-4984-9e8d-037d5fd9c0de","block_type":"box","text":"overall market and economic conditions, or conditions within the issuer’s region or industry, deteriorate.","page_number":149,"box":{"x":116,"y":459,"width":764,"height":12}},{"id":"b7e0292d-b91c-4cd5-9bbe-bce4ab20c461","block_type":"box","text":"To the extent that a Fund receives other assets in connection with a bankruptcy proceeding,","page_number":149,"box":{"x":116,"y":490,"width":681,"height":12}},{"id":"4d79c0c8-f074-4802-af1b-7eae87d105b3","block_type":"box","text":"reorganization or financial restructuring, the Fund may also be subject to additional risks associated with","page_number":149,"box":{"x":117,"y":506,"width":770,"height":12}},{"id":"fb84e524-63ca-49ce-bf0f-9c799717891e","block_type":"box","text":"the assets received. One example of assets that a Fund could receive is an interest in one or more","page_number":149,"box":{"x":116,"y":521,"width":730,"height":12}},{"id":"8e380dd6-ad6d-4908-a993-e9b2f343365d","block_type":"box","text":"loans made to the issuer as part of a workout agreed to by a consortium of lienholders and creditors of","page_number":149,"box":{"x":117,"y":537,"width":756,"height":12}},{"id":"8f198481-fbd4-419f-8629-da2f4e7d2958","block_type":"box","text":"the issuer. A Fund may receive such interests in loans to the extent permitted by the Investment","page_number":149,"box":{"x":116,"y":552,"width":710,"height":12}},{"id":"b4ad861e-6e1d-481c-af35-07e81ac110b3","block_type":"box","text":"Company Act.","page_number":149,"box":{"x":117,"y":568,"width":108,"height":12}},{"id":"95af442c-4a29-49a1-b222-6e1f26472a12","block_type":"box","text":"Securities or other assets received in a reorganization","page_number":149,"box":{"x":116,"y":599,"width":387,"height":12}},{"id":"8c541347-8d3d-4c42-9f7b-84275da0353b","block_type":"box","text":"or restructuring typically entail a higher degree of risk","page_number":149,"box":{"x":503,"y":599,"width":380,"height":12}},{"id":"01b10b8e-2873-4568-9ae5-f3fb4ddffc00","block_type":"box","text":"than investments in securities of issuers that","page_number":149,"box":{"x":116,"y":614,"width":319,"height":10}},{"id":"f6b9d6a5-87a5-436f-9265-f470153a1a35","block_type":"box","text":"have not undergone a reorganization or restructuring and may","page_number":149,"box":{"x":436,"y":614,"width":446,"height":12}},{"id":"995a0a39-0395-4ec6-b028-e9985a7138f4","block_type":"box","text":"be subject to heavy selling or downward pricing pre","page_number":149,"box":{"x":117,"y":630,"width":363,"height":12}},{"id":"6ae42cbe-f5a4-4673-a376-f7fcf3a25369","block_type":"box","text":"ssure after completion of the reorganization or","page_number":149,"box":{"x":481,"y":630,"width":332,"height":12}},{"id":"442273e7-db11-4bdf-8d13-4fe89a4c7703","block_type":"box","text":"restructuring. The post-reorganization/restructuring assets","page_number":149,"box":{"x":117,"y":645,"width":411,"height":12}},{"id":"425ed70e-bd56-4931-b1ef-e09ba0b4674c","block_type":"box","text":"and securities may also be illiquid and difficult to","page_number":149,"box":{"x":528,"y":645,"width":351,"height":12}},{"id":"aef4bb0f-e29c-4dc2-9292-bf28ea4c7b74","block_type":"box","text":"sell or value. If a Fund participates in negotiations with","page_number":149,"box":{"x":116,"y":661,"width":384,"height":12}},{"id":"2f8516f2-e68d-407b-8f61-aeb91f7e2b87","block_type":"box","text":"respect to a plan of reorganization or restructuring","page_number":149,"box":{"x":506,"y":661,"width":353,"height":12}},{"id":"9768ba81-8648-4570-ae47-0a0d8fb846a0","block_type":"box","text":"with respect to securities of the issuer held by a","page_number":149,"box":{"x":116,"y":676,"width":336,"height":12}},{"id":"bb66fcec-e997-49f2-9d32-f11acabf24f4","block_type":"box","text":"Fund, the Fund also may be restricted from disposing such","page_number":149,"box":{"x":458,"y":676,"width":417,"height":12}},{"id":"c298cd7c-93c7-450a-b38d-8d7b8c3a8d9d","block_type":"box","text":"securities for a period of time. If a Fund becomes involved in such proceedings, the Fund may have more","page_number":149,"box":{"x":116,"y":692,"width":747,"height":12}},{"id":"c96545e5-97e2-467c-a37e-07082a802716","block_type":"box","text":"active participation in the affairs of the iss","page_number":149,"box":{"x":116,"y":707,"width":292,"height":12}},{"id":"4e3d5fab-ce03-4427-8bb4-7749d4d94e47","block_type":"box","text":"uer than that assumed generally by an investor.","page_number":149,"box":{"x":409,"y":707,"width":337,"height":12}},{"id":"e39fe855-4ffd-4c76-821e-336a21b16495","block_type":"box","text":"Lease Obligations.","page_number":149,"box":{"x":116,"y":738,"width":148,"height":12}},{"id":"6db45833-2f77-4b03-8243-8cf55fab6603","block_type":"box","text":"A Fund may hold participation certificates in a lease, an installment purchase","page_number":149,"box":{"x":270,"y":738,"width":571,"height":12}},{"id":"277e24bb-37e2-418c-b2f5-f9d1a47daabb","block_type":"box","text":"contract, or a conditional sales contract (“lease obligations”). The Manager will monitor the credit","page_number":149,"box":{"x":116,"y":754,"width":716,"height":12}},{"id":"eaa5d0e9-10f2-4a35-979a-7f9247dddfb2","block_type":"box","text":"standing of each borrower and each entity providing credit support and/or a put option relating to lease","page_number":149,"box":{"x":116,"y":769,"width":761,"height":12}},{"id":"627f3bd8-9163-49a5-9330-8904424cba13","block_type":"box","text":"obligations.","page_number":149,"box":{"x":116,"y":785,"width":83,"height":12}},{"id":"830dad96-8ae8-4517-a5d0-aed9d63c0dcf","block_type":"box","text":"Life Settlement Investments.","page_number":149,"box":{"x":116,"y":816,"width":227,"height":9}},{"id":"d880ce95-65de-46bb-9b62-480e167568b4","block_type":"box","text":"A Fund may invest in life settlements, which are sales to third parties,","page_number":149,"box":{"x":349,"y":816,"width":514,"height":12}},{"id":"700a5c0a-abf8-4069-ad8e-893414b1f2ed","block_type":"box","text":"such as the Fund, of existing life insurance contracts for more than their cash surrender value but less","page_number":149,"box":{"x":116,"y":831,"width":763,"height":12}},{"id":"125333c8-390a-423d-a9ea-eb92922c6c0e","block_type":"box","text":"than the net benefits to be paid under the policies. When a Fund acquires such a contract, it pays the","page_number":149,"box":{"x":116,"y":847,"width":756,"height":12}},{"id":"9c95a088-a282-482a-aa8c-f9002ebc4bf2","block_type":"box","text":"policy premiums in return for the expected receipt of the net benefit as the beneficiary under the policy.","page_number":149,"box":{"x":117,"y":862,"width":767,"height":12}},{"id":"ba812743-dd72-4f6f-869e-330dd44bcf10","block_type":"box","text":"Investments in these contracts involve certain risks, including liquidity risk, credit risk of the insurance","page_number":149,"box":{"x":117,"y":878,"width":756,"height":12}},{"id":"8c1d8de2-3e99-444e-8f8c-db6c2ac35c94","block_type":"box","text":"II-62","page_number":149,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"bf24b2ad-30d9-452c-9f45-003c9e348319","block_type":"box","text":"NM1026U-6004382-149/605","page_number":149,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"518dda8a-4085-4214-b675-9881f6d61a3e","block_type":"box","text":"company, and inaccurate estimations of life expectancy of the insured individuals (viators). These","page_number":150,"box":{"x":116,"y":87,"width":729,"height":12}},{"id":"27c55287-7be2-406f-b684-e0ea8d70fd3c","block_type":"box","text":"policies may be considered illiquid because they are bought and sold in a secondary market through","page_number":150,"box":{"x":117,"y":103,"width":748,"height":12}},{"id":"77af5e71-73f7-4756-b16a-bf78905a3678","block_type":"box","text":"life settlement agents. Also, in the event of a bankruptcy of the insurance carrier for a policy, the Fund","page_number":150,"box":{"x":117,"y":118,"width":760,"height":12}},{"id":"9228b65c-401e-4f2b-b6b2-8ad1e15af3cb","block_type":"box","text":"may receive reduced or no benefits under the contract. A Fund seeks to minimize credit risk by","page_number":150,"box":{"x":117,"y":134,"width":708,"height":12}},{"id":"0a53060e-b46e-4773-a0cf-b4aa6aa514d6","block_type":"box","text":"investing in policies issued by a diverse range of highly-rated insurance carriers. Furthermore, a Fund","page_number":150,"box":{"x":117,"y":149,"width":758,"height":12}},{"id":"861e22f6-8b05-41b2-81a1-d302dbb5d316","block_type":"box","text":"may encounter losses on its investments if there is an inaccurate estimation of the life expectancies of","page_number":150,"box":{"x":117,"y":165,"width":761,"height":12}},{"id":"462709b3-2205-4afe-9e21-45de3b695b61","block_type":"box","text":"viators. A Fund intends to reduce this life expectancy risk by investing only in contracts where the life","page_number":150,"box":{"x":116,"y":180,"width":754,"height":12}},{"id":"45b85e40-32c8-49c5-9815-f64cbf5b83af","block_type":"box","text":"expectancy was reviewed by an experienced actuary, as well as by diversifying its investments across","page_number":150,"box":{"x":116,"y":196,"width":763,"height":12}},{"id":"1b44537e-984a-4673-85cc-7ef2c88c4454","block_type":"box","text":"viators of varying ages and medical profiles. In addition, it is unclear whether the income from life","page_number":150,"box":{"x":116,"y":211,"width":725,"height":12}},{"id":"328a21b0-220e-4694-8e1c-42d54ffb5374","block_type":"box","text":"settlements is qualifying income for purposes of the IRS 90% gross income test a Fund must satisfy","page_number":150,"box":{"x":116,"y":227,"width":746,"height":12}},{"id":"8871c3ea-7e81-4229-be8b-d7c1d8a561b2","block_type":"box","text":"each year to qualify as a regulated investment company. A Fund intends to monitor its investments to","page_number":150,"box":{"x":116,"y":242,"width":758,"height":12}},{"id":"9a4c7724-a1ad-4c60-b250-3e01724ee410","block_type":"box","text":"ensure that the Fund remains qualified as a regulated investment company.","page_number":150,"box":{"x":116,"y":258,"width":567,"height":12}},{"id":"73ae0c0d-ef37-4e32-8bc4-a406400b67f5","block_type":"box","text":"Liquidity Risk Management.","page_number":150,"box":{"x":116,"y":289,"width":221,"height":12}},{"id":"faba0021-e2b0-4fc6-90a9-a61751dbd2c5","block_type":"box","text":"Rule 22e-4 under the Investment Company Act (the “Liquidity Rule”)","page_number":150,"box":{"x":338,"y":289,"width":517,"height":12}},{"id":"480bd6f1-86d2-4688-b5c8-cf98bd25d785","block_type":"box","text":"requires open-end funds, such as the Funds, to adopt a liquidity risk management program and","page_number":150,"box":{"x":117,"y":304,"width":712,"height":12}},{"id":"91bcd486-a7b4-4a24-a829-c63422106a99","block_type":"box","text":"enhance disclosures regarding fund liquidity. As required by the Liquidity Rule, the Funds have","page_number":150,"box":{"x":116,"y":320,"width":709,"height":12}},{"id":"99558c2c-7f38-4771-b8f0-cd6603132771","block_type":"box","text":"implemented a liquidity risk management program (the “Liquidity Program”), and the Boards of","page_number":150,"box":{"x":117,"y":335,"width":704,"height":12}},{"id":"9a0fe7e5-cc77-4beb-bf63-069d026e5ff2","block_type":"box","text":"Directors of the Funds, including a majority of the independent Directors, have appointed the Manager","page_number":150,"box":{"x":117,"y":351,"width":762,"height":12}},{"id":"3523d3ff-4534-4867-a458-a8c7b31e3953","block_type":"box","text":"as the liquidity risk program administrator of the Liquidity Program. Under the Liquidity Program, the","page_number":150,"box":{"x":116,"y":366,"width":745,"height":12}},{"id":"3cd472ea-48c1-4afa-b238-a6356e9570f3","block_type":"box","text":"Manager assesses, manages, and periodically reviews each Fund’s liquidity risk and classifies each","page_number":150,"box":{"x":117,"y":382,"width":746,"height":12}},{"id":"29c53ec7-4d0d-4bb7-a0b1-1b077e38ccaf","block_type":"box","text":"investment held by a Fund as a “highly liquid investment,” “moderately liquid investment,” “less liquid","page_number":150,"box":{"x":117,"y":397,"width":750,"height":12}},{"id":"42c1c77d-de3f-421d-8d46-1b55079238fa","block_type":"box","text":"investment” or “illiquid investment.” The Liquidity Rule defines “liquidity risk” as the risk that a Fund","page_number":150,"box":{"x":117,"y":413,"width":736,"height":12}},{"id":"1d06ff14-3e51-4102-ba20-0bdea83513e1","block_type":"box","text":"could not meet requests to redeem shares issued by the Fund without significant dilution of the","page_number":150,"box":{"x":116,"y":428,"width":709,"height":12}},{"id":"ad388c53-8591-4f3d-8804-6ae5024c08f6","block_type":"box","text":"remaining investors’ interests in the Fund. The liquidity of a Fund’s portfolio investments is determined","page_number":150,"box":{"x":117,"y":444,"width":762,"height":12}},{"id":"1465ff5d-ac8f-43d3-801f-ee99ed22b841","block_type":"box","text":"based on relevant market, trading and investment-specific considerations under the Liquidity Program.","page_number":150,"box":{"x":117,"y":459,"width":764,"height":12}},{"id":"43e28a61-3426-4401-aa38-682085021993","block_type":"box","text":"To the extent that an investment is deemed to be an illiquid investment or a less liquid investment, a","page_number":150,"box":{"x":116,"y":475,"width":747,"height":12}},{"id":"1a3fadba-63d7-4c15-93e4-9f25da6fb3c1","block_type":"box","text":"Fund can expect to be exposed to greater liquidity risk.","page_number":150,"box":{"x":117,"y":490,"width":411,"height":12}},{"id":"b47488ba-3f7e-4968-92c5-6999da91a948","block_type":"box","text":"Master Limited Partnerships.","page_number":150,"box":{"x":116,"y":521,"width":230,"height":12}},{"id":"87c21438-b6e3-40db-b56d-be1c5725c275","block_type":"box","text":"Certain Funds may invest in publicly traded master limited partnerships","page_number":150,"box":{"x":347,"y":521,"width":538,"height":12}},{"id":"4d8d843b-aa31-4f8b-acf0-805cd3e9862c","block_type":"box","text":"(“MLPs”) which are limited partnerships or limited liability companies taxable as partnerships. MLPs","page_number":150,"box":{"x":117,"y":537,"width":741,"height":12}},{"id":"ea708087-fc48-4a6f-9625-2c96944878c7","block_type":"box","text":"may derive income and gains from the exploration, development, mining or production, processing,","page_number":150,"box":{"x":117,"y":552,"width":739,"height":12}},{"id":"3c6f5c3d-afb0-487b-b6f0-79870425402f","block_type":"box","text":"refining, transportation (including pipelines transporting gas, oil, or products thereof), or the marketing","page_number":150,"box":{"x":117,"y":568,"width":758,"height":12}},{"id":"c9be6c3c-5e80-4517-8db7-6c199daef875","block_type":"box","text":"of any mineral or natural resources. MLPs generally have two classes of owners, the general partner","page_number":150,"box":{"x":116,"y":583,"width":752,"height":12}},{"id":"45bd5df1-0874-4fa7-bf53-8e8b514dbe20","block_type":"box","text":"and limited partners. When investing in an MLP, a Fund intends to purchase publicly traded common","page_number":150,"box":{"x":116,"y":599,"width":753,"height":12}},{"id":"fe44c228-d789-416a-80a8-22b71ede3a72","block_type":"box","text":"units issued to limited partners of the MLP. The general partner is typically owned by a major energy","page_number":150,"box":{"x":117,"y":614,"width":749,"height":12}},{"id":"0259dbb5-fa7a-4938-91ef-468fd7789c97","block_type":"box","text":"company, an investment fund, the direct management of the MLP or is an entity owned by one or more","page_number":150,"box":{"x":116,"y":630,"width":769,"height":12}},{"id":"53f58f4a-a283-4489-a4a1-698e4a7ca52c","block_type":"box","text":"of such parties. The general partner may be structured as a private or publicly traded corporation or","page_number":150,"box":{"x":116,"y":645,"width":744,"height":12}},{"id":"fe2e9046-8f4d-4750-88b5-71c3903f4af7","block_type":"box","text":"other entity. The general partner typically controls the operations and management of the MLP through","page_number":150,"box":{"x":116,"y":661,"width":762,"height":12}},{"id":"ef16b367-2196-4fb9-9322-fc6a0af7cd46","block_type":"box","text":"an up to 2% equity interest in the MLP plus, in many cases, ownership of common units and","page_number":150,"box":{"x":116,"y":676,"width":683,"height":12}},{"id":"90dc1f2d-4efa-48f1-bc8a-6bcb2ba30482","block_type":"box","text":"subordinated units. Limited partners own the remainder of the partnership, through ownership of","page_number":150,"box":{"x":116,"y":692,"width":714,"height":12}},{"id":"0a561199-f047-4cb4-9378-0d933eea4613","block_type":"box","text":"common units, and have a limited role in the partnership’s operations and management.","page_number":150,"box":{"x":116,"y":707,"width":652,"height":12}},{"id":"aeaf6ddb-c054-4fd2-a2bf-29f7b5ac4498","block_type":"box","text":"MLPs are typically structured such that common units and general partner interests have first priority to","page_number":150,"box":{"x":117,"y":738,"width":764,"height":12}},{"id":"c674039a-1df2-4c90-afd9-89e1f1c092ef","block_type":"box","text":"receive quarterly cash distributions up to an established minimum amount (“minimum quarterly","page_number":150,"box":{"x":117,"y":754,"width":701,"height":12}},{"id":"1ae60fbf-d943-48aa-afb4-3e136688c0c6","block_type":"box","text":"distributions” or “MQD”). Common and general partner interests also accrue arrearages in distributions","page_number":150,"box":{"x":116,"y":769,"width":762,"height":12}},{"id":"dc8cc779-998d-42cf-b413-b7c678c2cfbf","block_type":"box","text":"to the extent the MQD is not paid. Once common and general partner interests have been paid,","page_number":150,"box":{"x":116,"y":785,"width":708,"height":12}},{"id":"4e92b2bb-19a0-40d2-8693-ab4ef9a8e60e","block_type":"box","text":"subordinated units receive distributions of up to the MQD; however, subordinated units do not accrue","page_number":150,"box":{"x":116,"y":800,"width":750,"height":12}},{"id":"28047c91-0ca2-41d4-9f75-c673ca721f45","block_type":"box","text":"arrearages. Distributable cash in excess of the MQD paid to both common and subordinated units is","page_number":150,"box":{"x":116,"y":816,"width":743,"height":12}},{"id":"9d404826-46bf-4c47-8c88-3125e1d2e63e","block_type":"box","text":"distributed to both common and subordinated units generally on a pro rata basis. The general partner","page_number":150,"box":{"x":116,"y":831,"width":757,"height":12}},{"id":"c384227d-45b0-4845-bfcd-2376a1bde90c","block_type":"box","text":"is also eligible to receive incentive distributions if the general partner operates the business in a","page_number":150,"box":{"x":117,"y":847,"width":712,"height":12}},{"id":"d84bfa63-0330-43e5-8cda-bce2e14709a0","block_type":"box","text":"manner which results in distributions paid per common unit surpassing specified target levels. As the","page_number":150,"box":{"x":117,"y":862,"width":751,"height":12}},{"id":"fee2bdf2-c845-4f5e-ad82-4502d1d62b56","block_type":"box","text":"general partner increases cash distributions to the limited partners, the general partner receives an","page_number":150,"box":{"x":116,"y":878,"width":739,"height":12}},{"id":"f7af0803-1932-44c7-9ca1-97ebab51c8f4","block_type":"box","text":"II-63","page_number":150,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"47ef195d-8bc1-4ef1-a7b7-b7593bc6b32f","block_type":"box","text":"NM1026U-6004382-150/605","page_number":150,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"385ea636-adf5-47e5-9fb0-2df5ff31984b","block_type":"box","text":"increasingly higher percentage of the incremental cash distributions. A common arrangement provides","page_number":151,"box":{"x":117,"y":87,"width":764,"height":12}},{"id":"d58bce71-395d-413d-b4fe-28e75fcd96fb","block_type":"box","text":"that the general partner can reach a tier where it receives 50% of every incremental dollar paid to","page_number":151,"box":{"x":116,"y":102,"width":727,"height":13}},{"id":"24f0e8bf-7841-4e57-8e26-9476cfaf4c09","block_type":"box","text":"common and subordinated unit holders. These incentive distributions encourage the general partner to","page_number":151,"box":{"x":116,"y":118,"width":767,"height":12}},{"id":"ca521f5e-c3dd-46d3-9755-828fa594aa8d","block_type":"box","text":"streamline costs, increase capital expenditures and acquire assets in order to increase the","page_number":151,"box":{"x":116,"y":134,"width":676,"height":11}},{"id":"a4520f76-8668-4db0-a16f-0bc304da2e16","block_type":"box","text":"partnership’s cash flow and raise the quarterly cash distribution in order to reach higher tiers. Such","page_number":151,"box":{"x":117,"y":149,"width":736,"height":12}},{"id":"ad31dadd-7dd2-48fa-89b2-0eff874e72ab","block_type":"box","text":"results benefit all security holders of the MLP.","page_number":151,"box":{"x":117,"y":165,"width":343,"height":12}},{"id":"48c506c1-f9ff-4a7b-937f-418327d19a22","block_type":"box","text":"MLP common units represent a limited partnership interest in the MLP. Common units are listed and","page_number":151,"box":{"x":117,"y":196,"width":748,"height":11}},{"id":"8e72859c-da2f-4fdf-bdd8-4fc752ef9eae","block_type":"box","text":"traded on U.S. securities exchanges, with their value fluctuating predominantly based on prevailing","page_number":151,"box":{"x":116,"y":211,"width":739,"height":12}},{"id":"ce3f1926-a415-4056-9b10-849d0140a6d3","block_type":"box","text":"market conditions and the success of the MLP. Certain Funds intend to purchase common units in","page_number":151,"box":{"x":117,"y":227,"width":733,"height":11}},{"id":"4c2217a8-617b-4b8c-ace7-90cf1f727087","block_type":"box","text":"market transactions. Unlike owners of common stock of a corporation, owners of common units have","page_number":151,"box":{"x":117,"y":242,"width":752,"height":12}},{"id":"81c6e006-43e1-489f-a729-95b69c04d8fb","block_type":"box","text":"limited voting rights and have no ability to annually elect directors. In the event of liquidation, common","page_number":151,"box":{"x":117,"y":258,"width":758,"height":12}},{"id":"66726f17-8936-4301-8c31-e77bfc224bb8","block_type":"box","text":"units have preference over subordinated units, but not over debt or preferred units, to the remaining","page_number":151,"box":{"x":117,"y":273,"width":744,"height":12}},{"id":"21c8787d-809f-4306-bd66-4d7318d628e5","block_type":"box","text":"assets of the MLP.","page_number":151,"box":{"x":116,"y":289,"width":144,"height":9}},{"id":"fe804901-1fd7-4fee-98bd-922839bb4877","block_type":"box","text":"Merger Transaction Risk.","page_number":151,"box":{"x":116,"y":320,"width":200,"height":12}},{"id":"0670d92e-e772-4359-bc47-c98d9201fc2d","block_type":"box","text":"A Fund may buy stock of the target company in an announced merger","page_number":151,"box":{"x":317,"y":320,"width":531,"height":12}},{"id":"967ba770-8f4e-4187-b623-11e2c825e4c9","block_type":"box","text":"transaction prior to the consummation of such transaction. In that circumstance, a Fund would expect","page_number":151,"box":{"x":116,"y":335,"width":757,"height":12}},{"id":"bf9e5ec3-3dd5-4522-9d12-13df45b1de82","block_type":"box","text":"to receive an amount (whether in cash, stock of the acquiring company or a combination of both) in","page_number":151,"box":{"x":116,"y":351,"width":740,"height":12}},{"id":"64ac4078-87aa-4d93-99be-753d7f7616f3","block_type":"box","text":"excess of the purchase price paid by the Fund for the target company’s stock. However, a Fund is","page_number":151,"box":{"x":116,"y":366,"width":733,"height":12}},{"id":"4e9cce68-29c7-42ad-b19e-6c0d2a90ad9d","block_type":"box","text":"subject to the risk that the merger transaction may be canceled, delayed or restructured, in which case","page_number":151,"box":{"x":116,"y":382,"width":766,"height":12}},{"id":"4bd20388-6852-4780-9f73-9a00987cee67","block_type":"box","text":"a Fund’s holding of the target company’s stock may not result in any profit for the Fund and may lose","page_number":151,"box":{"x":116,"y":397,"width":754,"height":12}},{"id":"dad6f800-cba0-48aa-9e89-34156adba102","block_type":"box","text":"significant value.","page_number":151,"box":{"x":116,"y":413,"width":129,"height":12}},{"id":"11aa66dd-14a4-4d4d-87e1-b07370cc2cc6","block_type":"box","text":"Money Market Obligations of Domestic Banks,","page_number":151,"box":{"x":116,"y":444,"width":355,"height":12}},{"id":"ce7d5dbf-2a8a-4de4-b62b-8b370c3c90ef","block_type":"box","text":"Foreign Banks and Foreign Branches of U.S. Banks.","page_number":151,"box":{"x":472,"y":444,"width":404,"height":12}},{"id":"1e1d6ea1-9ecb-492d-a147-22ffea50b159","block_type":"box","text":"Certain Funds may purchase bank obligations, such as","page_number":151,"box":{"x":117,"y":459,"width":396,"height":12}},{"id":"7c1aa3bf-d285-4767-a7f0-5c5fef523f18","block_type":"box","text":"certificates of deposit, notes, bankers’ acceptances","page_number":151,"box":{"x":513,"y":459,"width":367,"height":12}},{"id":"010c4cb5-baae-4e26-bb6b-4e88e3e6dff6","block_type":"box","text":"and time deposits, including instruments issued or suppo","page_number":151,"box":{"x":116,"y":475,"width":403,"height":12}},{"id":"0e70cdff-5a58-4581-9981-72a8137de6fa","block_type":"box","text":"rted by the credit of U.S. or foreign banks or","page_number":151,"box":{"x":521,"y":475,"width":315,"height":12}},{"id":"d77d65fd-05c8-402a-a0af-bbe562622eb5","block_type":"box","text":"savings institutions having total assets at the time","page_number":151,"box":{"x":116,"y":490,"width":356,"height":12}},{"id":"e870b028-53ef-41c3-b068-01b4ef58952e","block_type":"box","text":"of purchase in excess of $1 billion. These obligations may","page_number":151,"box":{"x":472,"y":489,"width":415,"height":13}},{"id":"0546bd4b-bcbb-49a5-9a88-77e4fc37f0cd","block_type":"box","text":"be general obligations of the parent bank","page_number":151,"box":{"x":117,"y":506,"width":290,"height":12}},{"id":"b7b95b52-c97f-4d8e-b3d2-2b52a9bd9a4a","block_type":"box","text":"k or may be limited to the issuing branch or subsidiary by the terms","page_number":151,"box":{"x":407,"y":506,"width":473,"height":12}},{"id":"a3e8cf1b-2dde-43ad-aade-2a11ad3d4f53","block_type":"box","text":"of a specific obligation or by gov","page_number":151,"box":{"x":116,"y":521,"width":228,"height":12}},{"id":"49e6f0a5-d765-4567-850d-711834e934b6","block_type":"box","text":"ernment regulation. The assets of","page_number":151,"box":{"x":344,"y":521,"width":244,"height":12}},{"id":"82ca0d5d-484d-4d4e-8e67-314330b245c6","block_type":"box","text":"a bank or savings institution will be","page_number":151,"box":{"x":588,"y":521,"width":251,"height":12}},{"id":"49b3f9d3-87a8-4315-bd95-ced9fa928c12","block_type":"box","text":"deemed to include the assets of its domestic and fore","page_number":151,"box":{"x":116,"y":537,"width":380,"height":9}},{"id":"44b8d531-d646-4f18-b375-f91a559542eb","block_type":"box","text":"ign branches for purposes of a Fund’s investment","page_number":151,"box":{"x":497,"y":537,"width":356,"height":12}},{"id":"d7bd6e92-5c9c-44a0-b993-bcf4022d3f7c","block_type":"box","text":"policies. Investments in short-term bank obligations","page_number":151,"box":{"x":117,"y":552,"width":368,"height":12}},{"id":"daa2398f-5977-4c7c-a147-17b4dc6576e4","block_type":"box","text":"may include obligations of foreign banks and domestic","page_number":151,"box":{"x":485,"y":552,"width":390,"height":12}},{"id":"a70075a0-0618-4a13-a6b2-908b3904fb26","block_type":"box","text":"branches of foreign banks, and also foreign branches of domestic banks.","page_number":151,"box":{"x":117,"y":568,"width":521,"height":12}},{"id":"b7a41cd9-0d92-46f6-aa1a-e0862c8c92f5","block_type":"box","text":"To the extent consistent with their investment objectives, a Fund may invest in debt obligations of","page_number":151,"box":{"x":116,"y":599,"width":727,"height":12}},{"id":"02541fea-a39a-4250-87d3-4c3c0b699793","block_type":"box","text":"domestic or foreign corporations and banks, and may acquire commercial obligations issued by","page_number":151,"box":{"x":116,"y":614,"width":713,"height":12}},{"id":"eb9b3762-156e-4fb1-8e2f-ba0eb6c6d91c","block_type":"box","text":"Canadian corporations and Canadian counterparts of U.S. corporations, as well as Europaper, which is","page_number":151,"box":{"x":117,"y":630,"width":769,"height":12}},{"id":"b77005db-3562-400a-b739-f8acb0660818","block_type":"box","text":"U.S. dollar-denominated commercial paper of a foreign issuer.","page_number":151,"box":{"x":117,"y":645,"width":466,"height":12}},{"id":"e33eddf6-64c7-4a7f-83aa-3034dba7e876","block_type":"box","text":"Money Market Securities.","page_number":151,"box":{"x":116,"y":676,"width":201,"height":12}},{"id":"b9779386-49b5-41fb-8d7e-33df0be9cea7","block_type":"box","text":"Certain Funds may invest in a broad range of short-term, high quality, U.S.","page_number":151,"box":{"x":323,"y":676,"width":553,"height":12}},{"id":"908ff4c3-5949-48c7-828b-eba0b9aeb787","block_type":"box","text":"dollar-denominated instruments, such as government, bank, commercial and other obligations that are","page_number":151,"box":{"x":116,"y":692,"width":760,"height":12}},{"id":"131d247f-1c92-4450-b096-a819bed5a400","block_type":"box","text":"available in the money markets. In particular, the Funds may invest in:","page_number":151,"box":{"x":116,"y":707,"width":519,"height":12}},{"id":"dce233c3-3b3d-4239-b42b-dc3b7d802428","block_type":"box","text":"(a) U.S. dollar-denominated obligations issued or supported by the credit of U.S. or foreign banks","page_number":151,"box":{"x":150,"y":738,"width":729,"height":12}},{"id":"236cdd70-a696-4458-99c5-8503258eaa82","block_type":"box","text":"or savings institutions with total assets in excess of $1 billion (including obligations of foreign","page_number":151,"box":{"x":184,"y":753,"width":684,"height":13}},{"id":"47871494-d77d-420a-91b0-b29c4347170c","block_type":"box","text":"branches of such banks);","page_number":151,"box":{"x":184,"y":769,"width":186,"height":12}},{"id":"6fb12e70-32f1-4b7c-b1fa-4d84241c6d20","block_type":"box","text":"(b) high quality commercial paper and other obligations issued or guaranteed by U.S. and foreign","page_number":151,"box":{"x":150,"y":792,"width":728,"height":13}},{"id":"599e91c2-078e-4367-b29e-30838be613dd","block_type":"box","text":"corporations and other issuers rated (at the time of purchase) A-2 or higher by S&P, Prime-2","page_number":151,"box":{"x":184,"y":808,"width":686,"height":12}},{"id":"8fa8f1c2-eb52-4c69-89cf-fff02785f47c","block_type":"box","text":"or higher by Moody’s or F-2 or higher by Fitch, as well as high quality corporate bonds rated","page_number":151,"box":{"x":184,"y":824,"width":681,"height":12}},{"id":"a8b520ef-5f24-4a7f-88c1-5f07ca2c5d72","block_type":"box","text":"(at the time of purchase) A or higher by those rating agencies;","page_number":151,"box":{"x":184,"y":839,"width":465,"height":12}},{"id":"984a730c-8ec6-418d-8422-ff5a726e9a20","block_type":"box","text":"(c) unrated notes, paper and other instruments that are of comparable quality to the instruments","page_number":151,"box":{"x":150,"y":862,"width":726,"height":12}},{"id":"afae5cd3-9ac6-4882-bd7f-4d630063a456","block_type":"box","text":"described in (b) above as determined by the Fund’s Manager;","page_number":151,"box":{"x":184,"y":878,"width":463,"height":12}},{"id":"c4dc7f0d-46cd-49e4-b2e3-5e3efdaf25b5","block_type":"box","text":"II-64","page_number":151,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"c5fd83df-240e-4ae2-88ff-d5cd0f1113d7","block_type":"box","text":"NM1026U-6004382-151/605","page_number":151,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"fc0a8877-2848-4da9-9b8e-6c4ef993cf5b","block_type":"box","text":"(d) asset-backed securities (including interests in pools of assets such as mortgages, installment","page_number":152,"box":{"x":150,"y":87,"width":730,"height":12}},{"id":"e2fd6a02-0342-4449-8580-77f44537fded","block_type":"box","text":"purchase obligations and credit card receivables);","page_number":152,"box":{"x":184,"y":102,"width":374,"height":13}},{"id":"93e0fec7-632e-4ac3-be40-821d653a2ee6","block_type":"box","text":"(e) securities issued or guaranteed as to principal and interest by the U.S. Government or by its","page_number":152,"box":{"x":150,"y":126,"width":722,"height":12}},{"id":"2261d55b-bf01-4447-864a-b7c324e17f5a","block_type":"box","text":"agencies or authorities and related custodial receipts;","page_number":152,"box":{"x":184,"y":141,"width":401,"height":12}},{"id":"dc15e7d2-25b6-451d-93d0-6d63009be358","block_type":"box","text":"(f) dollar-denominated securities issued or guaranteed by foreign governments or their political","page_number":152,"box":{"x":150,"y":165,"width":719,"height":12}},{"id":"3c27ccff-afc1-4ac9-9fbe-96bf97462960","block_type":"box","text":"subdivisions, agencies or authorities;","page_number":152,"box":{"x":184,"y":180,"width":279,"height":12}},{"id":"ff8898f9-693c-4069-91a6-754109348fdc","block_type":"box","text":"(g) funding agreements issued by highly-rated U.S. insurance companies;","page_number":152,"box":{"x":150,"y":203,"width":561,"height":12}},{"id":"b384c090-d8bf-4e81-a6c6-95f73c29680d","block_type":"box","text":"(h) securities issued or guaranteed by state or local governmental bodies;","page_number":152,"box":{"x":150,"y":227,"width":560,"height":12}},{"id":"1cc5d6cb-5071-46c4-b990-68990c13e9b1","block_type":"box","text":"(i) repurchase agreements relating to the above instruments;","page_number":152,"box":{"x":150,"y":250,"width":469,"height":12}},{"id":"f18ad671-fa54-46b8-ab12-b20507457ee5","block_type":"box","text":"(j) municipal bonds and notes whose principal and interest payments are guaranteed by the U.S.","page_number":152,"box":{"x":150,"y":273,"width":736,"height":12}},{"id":"6652448e-dca7-4f90-8b1f-ec04b522edce","block_type":"box","text":"Government or one of its agencies or authorities or which otherwise depend directly or","page_number":152,"box":{"x":184,"y":289,"width":646,"height":12}},{"id":"a1844e6f-5606-463a-89b1-8f0c81282dce","block_type":"box","text":"indirectly on the credit of the United States;","page_number":152,"box":{"x":184,"y":304,"width":325,"height":12}},{"id":"b683ccec-dff0-4ad1-8e9d-7938472f5754","block_type":"box","text":"(k) fixed and variable rate notes and similar debt instruments rated MIG-2, VMIG-2 or Prime-2 or","page_number":152,"box":{"x":150,"y":327,"width":730,"height":12}},{"id":"ba7dff35-e816-4659-9d90-6bc7842cb90c","block_type":"box","text":"higher by Moody’s, SP-2 or A-2 or higher by S&P, or F-2 or higher by Fitch;","page_number":152,"box":{"x":184,"y":343,"width":563,"height":12}},{"id":"812179de-e70d-4af2-b9e3-43caef538cdb","block_type":"box","text":"(l) tax-exempt commercial paper and similar debt instruments rated Prime-2 or higher by","page_number":152,"box":{"x":150,"y":366,"width":675,"height":12}},{"id":"40654fb9-327e-408a-b95b-7183d198629d","block_type":"box","text":"Moody’s, A-2 or higher by S&P, or F-2 or higher by Fitch;","page_number":152,"box":{"x":184,"y":382,"width":428,"height":12}},{"id":"7c59b972-fec1-46b2-87c9-db049dcf5931","block_type":"box","text":"(m) municipal bonds rated A or higher by Moody’s, S&P or Fitch;","page_number":152,"box":{"x":150,"y":405,"width":488,"height":12}},{"id":"584c0d8c-cfc3-466e-891c-945541301ce2","block_type":"box","text":"(n) unrated notes, paper or other instruments that are of comparable quality to the instruments","page_number":152,"box":{"x":150,"y":428,"width":713,"height":12}},{"id":"487aed35-28f4-4c06-b42b-7959aa03cb87","block_type":"box","text":"described above, as determined by the Fund’s Manager under guidelines established by the","page_number":152,"box":{"x":184,"y":444,"width":688,"height":12}},{"id":"1d87e3fe-60b4-4670-a95f-b20a2320713e","block_type":"box","text":"Board; and","page_number":152,"box":{"x":184,"y":459,"width":86,"height":11}},{"id":"c86e7573-73c5-4f63-bf1e-b148aedd2a9c","block_type":"box","text":"(o) municipal bonds and notes which are guaranteed as to principal and interest by the U.S.","page_number":152,"box":{"x":150,"y":482,"width":693,"height":12}},{"id":"6da8621e-3f01-437b-9bb9-f024cdda4bff","block_type":"box","text":"Government or an agency or instrumentality thereof or which otherwise depend directly or","page_number":152,"box":{"x":184,"y":498,"width":671,"height":12}},{"id":"7ca394b2-c129-42f1-ac89-df4cb0d9dc80","block_type":"box","text":"indirectly on the credit of the United States.","page_number":152,"box":{"x":184,"y":513,"width":325,"height":12}},{"id":"faddcd1a-5676-4e64-bd57-8cf975b22ac5","block_type":"box","text":"Mortgage-Related Securities.","page_number":152,"box":{"x":116,"y":544,"width":236,"height":12}},{"id":"342f8825-c688-4601-9e41-145b6644670d","block_type":"box","text":"Mortgage-Backed Securities.","page_number":152,"box":{"x":116,"y":568,"width":214,"height":12}},{"id":"6cf36b61-357b-475d-a469-e9c104fef67b","block_type":"box","text":"Mortgage-backed securities represent interests in pools of mortgages in","page_number":152,"box":{"x":332,"y":568,"width":544,"height":12}},{"id":"920b4114-2974-4a6a-a13d-7a669788bdda","block_type":"box","text":"which payments of both principal and interest on the securities are generally made monthly, in effect","page_number":152,"box":{"x":116,"y":583,"width":749,"height":12}},{"id":"8fbe3295-f571-4e4c-a913-92951938b11e","block_type":"box","text":"“passing through” monthly payments made by borrowers on the residential or commercial mortgage","page_number":152,"box":{"x":116,"y":599,"width":745,"height":12}},{"id":"90ed13a4-79fa-4f29-8221-ed01074669ba","block_type":"box","text":"loans that underlie the securities (net of any fees paid to the issuer or guarantor of the securities).","page_number":152,"box":{"x":117,"y":614,"width":728,"height":12}},{"id":"fdfe9da7-41c2-471d-9d16-fe08ca3552af","block_type":"box","text":"Mortgage-backed securities differ from other forms of debt securities, which normally provide for","page_number":152,"box":{"x":117,"y":630,"width":718,"height":12}},{"id":"084e6905-8fc8-4d20-9db0-6efb045b4aaf","block_type":"box","text":"periodic payment of interest in fixed amounts with principal payments at maturity or specified call","page_number":152,"box":{"x":117,"y":645,"width":721,"height":12}},{"id":"c117d37a-28f3-4810-b6b5-145fd6571f65","block_type":"box","text":"dates.","page_number":152,"box":{"x":116,"y":661,"width":44,"height":9}},{"id":"03306127-1ec4-47e0-99b1-7da5a9cbf550","block_type":"box","text":"Mortgage-backed securities are subject to the general risks associated with investing in real estate","page_number":152,"box":{"x":117,"y":692,"width":731,"height":12}},{"id":"b8b84f52-8fe0-4143-bcfc-872d56a6072e","block_type":"box","text":"securities; that is, they may lose value if the value of the underlying real estate to which a pool of","page_number":152,"box":{"x":116,"y":707,"width":718,"height":12}},{"id":"ed6b0f59-4c55-49fb-a83b-92aeb0da6810","block_type":"box","text":"mortgages relates declines. In addition, investments in mortgage-backed securities involve certain","page_number":152,"box":{"x":117,"y":723,"width":726,"height":12}},{"id":"4aa77b78-dd56-4763-a469-d981ad89e39f","block_type":"box","text":"specific risks. These risks include the failure of a party to meet its commitments under the related","page_number":152,"box":{"x":116,"y":738,"width":720,"height":12}},{"id":"09db4f78-f9c7-44dc-aedd-57dcd2118909","block_type":"box","text":"operative documents, adverse interest rate changes and the effects of prepayments on mortgage cash","page_number":152,"box":{"x":116,"y":754,"width":762,"height":12}},{"id":"9676c20a-eade-41fb-8959-e322a5848ee3","block_type":"box","text":"flows. Mortgage-backed securities are “pass-through” securities, meaning that principal and interest","page_number":152,"box":{"x":116,"y":769,"width":740,"height":12}},{"id":"c3308717-3dd5-4392-ba3b-78a18be840b1","block_type":"box","text":"payments made by the borrower on the underlying mortgages are passed through to a Fund.","page_number":152,"box":{"x":117,"y":785,"width":687,"height":12}},{"id":"30f31da2-d295-4a96-8f74-08ba68f842dc","block_type":"box","text":"Accordingly, the value of mortgage-backed securities in which a Fund invests may be particularly","page_number":152,"box":{"x":116,"y":800,"width":720,"height":12}},{"id":"8ba8b0b7-a38d-4b3f-983b-9792bc181f0a","block_type":"box","text":"sensitive to changes in prevailing interest rates, and, like other fixed income investments, the ability of","page_number":152,"box":{"x":116,"y":816,"width":757,"height":12}},{"id":"f9c10de7-e75d-488f-80bb-2a88647b9fc6","block_type":"box","text":"a Fund to utilize these instruments successfully may depend in part upon the ability of the Manager to","page_number":152,"box":{"x":116,"y":831,"width":760,"height":12}},{"id":"46c5dafe-f9cb-4c4d-a7fd-f1c1b512d6da","block_type":"box","text":"forecast interest rates and other economic factors correctly. The value of mortgage-backed securities,","page_number":152,"box":{"x":116,"y":847,"width":761,"height":12}},{"id":"781ad2ea-337e-471b-a862-31816c4ce0d9","block_type":"box","text":"like that of traditional fixed-income securities, typically increases when interest rates fall and decreases","page_number":152,"box":{"x":117,"y":862,"width":768,"height":12}},{"id":"f0b782a2-d389-47b2-9b70-5283bc145b02","block_type":"box","text":"when interest rates rise. However, mortgage-backed securities differ from traditional fixed-income","page_number":152,"box":{"x":116,"y":878,"width":729,"height":12}},{"id":"5e336282-efb9-49c8-acc5-1dec02a7d81b","block_type":"box","text":"II-65","page_number":152,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"9eb928eb-35bc-4986-9048-984a6fd0bfa6","block_type":"box","text":"NM1026U-6004382-152/605","page_number":152,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"69dbf998-6817-4489-a16b-7262a1f7ff1c","block_type":"box","text":"securities because of their potential for prepayment without penalty. The price paid by a Fund for its","page_number":153,"box":{"x":116,"y":87,"width":745,"height":12}},{"id":"378571da-6466-420e-8cc0-78cf9bf308fc","block_type":"box","text":"mortgage-backed securities, the yield the Fund expects to receive from such securities and the","page_number":153,"box":{"x":117,"y":102,"width":709,"height":13}},{"id":"a29c8ebc-04b2-4879-94a4-4ac15ceadb41","block_type":"box","text":"weighted average life of the securities are based on a number of factors, including the anticipated rate","page_number":153,"box":{"x":116,"y":118,"width":762,"height":12}},{"id":"194fb2fb-59f7-467c-9f6a-66fe8b0fac01","block_type":"box","text":"of prepayment of the underlying mortgages. In a period of declining interest rates, borrowers may","page_number":153,"box":{"x":116,"y":134,"width":727,"height":12}},{"id":"97631f77-b51c-4ad4-beb6-8fda2542ae62","block_type":"box","text":"prepay the underlying mortgages more quickly than anticipated, thereby reducing the yield to maturity","page_number":153,"box":{"x":117,"y":149,"width":757,"height":12}},{"id":"286d7d0d-912d-4719-86c4-063b049fce86","block_type":"box","text":"and the average life of the mortgage-backed securities. Moreover, when a Fund reinvests the proceeds","page_number":153,"box":{"x":116,"y":165,"width":772,"height":12}},{"id":"571606d7-b7b6-4989-9d4b-202a828aa929","block_type":"box","text":"of a prepayment in these circumstances, it will likely receive a rate of interest that is lower than the rate","page_number":153,"box":{"x":116,"y":180,"width":769,"height":12}},{"id":"16d3eb1c-3a9d-47ca-91ed-d8fd922d2ce8","block_type":"box","text":"on the security that was prepaid.","page_number":153,"box":{"x":116,"y":196,"width":247,"height":12}},{"id":"52d1a3a7-9e6c-476e-b323-6b0e65e69428","block_type":"box","text":"To the extent that a Fund purchases mortgage-backed securities at a premium, mortgage foreclosures","page_number":153,"box":{"x":116,"y":227,"width":766,"height":12}},{"id":"54bba281-312c-4292-bc89-10f312a2c40f","block_type":"box","text":"and principal prepayments may result in a loss to the extent of the premium paid. If a Fund buys such","page_number":153,"box":{"x":116,"y":242,"width":758,"height":12}},{"id":"d839c5da-5c47-4bc2-8cd8-7d0358a1fc06","block_type":"box","text":"securities at a discount, both scheduled payments of principal and unscheduled prepayments will","page_number":153,"box":{"x":116,"y":258,"width":726,"height":12}},{"id":"d996783f-53ed-43e9-89ae-15b96efe328c","block_type":"box","text":"increase current and total returns and will accelerate the recognition of income, which, when distributed","page_number":153,"box":{"x":117,"y":273,"width":771,"height":12}},{"id":"3bf97a23-05e4-443f-80a5-08d838eeb2e4","block_type":"box","text":"to shareholders, will be taxable as ordinary income. In a period of rising interest rates, prepayments of","page_number":153,"box":{"x":116,"y":289,"width":762,"height":12}},{"id":"87c24f96-1ea9-4d3b-a090-9cf7f7976f5f","block_type":"box","text":"the underlying mortgages may occur at a slower than expected rate, creating maturity extension risk.","page_number":153,"box":{"x":116,"y":304,"width":753,"height":12}},{"id":"b237efe9-f717-4eca-ba6b-342164b0beb3","block_type":"box","text":"This particular risk may effectively change a security that was considered short- or intermediate-term at","page_number":153,"box":{"x":116,"y":320,"width":771,"height":12}},{"id":"203e9ea2-0277-4ebd-8a49-bfe8a282a355","block_type":"box","text":"the time of purchase into a long-term security. Since the value of long-term securities generally","page_number":153,"box":{"x":116,"y":335,"width":709,"height":12}},{"id":"9f044e73-65c0-4652-a741-4a5801126ea7","block_type":"box","text":"fluctuates more widely in response to changes in interest rates than that of shorter-term securities,","page_number":153,"box":{"x":116,"y":351,"width":736,"height":12}},{"id":"cc1ad45f-09be-432a-80a4-f01563a91641","block_type":"box","text":"maturity extension risk could increase the inherent volatility of the Fund. Under certain interest rate and","page_number":153,"box":{"x":117,"y":366,"width":769,"height":12}},{"id":"9d40c76a-cb69-4446-a5fb-a7ed6632d07d","block_type":"box","text":"prepayment scenarios, a Fund may fail to recoup fully its investment in mortgage-backed securities","page_number":153,"box":{"x":117,"y":382,"width":740,"height":12}},{"id":"d3198c6f-30c2-47ee-ba4f-d12065b078c7","block_type":"box","text":"notwithstanding any direct or indirect governmental or agency guarantee.","page_number":153,"box":{"x":117,"y":397,"width":547,"height":12}},{"id":"db1efa27-598a-4c95-814d-686ba8faf7b2","block_type":"box","text":"There are currently three types of mortgage pass-through securities: (1) those issued by the U.S.","page_number":153,"box":{"x":116,"y":428,"width":725,"height":12}},{"id":"3f37037e-68ff-44c2-8d4d-411cd4fefcbc","block_type":"box","text":"Government or one of its agencies or instrumentalities, such as the Government National Mortgage","page_number":153,"box":{"x":117,"y":444,"width":742,"height":12}},{"id":"13523451-f430-40f8-9074-0e61468a99b2","block_type":"box","text":"Association (“Ginnie Mae”), the Federal National Mortgage Association (“Fannie Mae”) and the Federal","page_number":153,"box":{"x":116,"y":459,"width":770,"height":12}},{"id":"5c5d69a7-9cb7-4eda-8c59-f45ebdb8da24","block_type":"box","text":"Home Loan Mortgage Corporation (“Freddie Mac”); (2) those issued by private issuers that represent","page_number":153,"box":{"x":117,"y":475,"width":753,"height":12}},{"id":"075d5cf8-c2a4-4307-b09c-3079d4148b39","block_type":"box","text":"an interest in or are collateralized by pass-through securities issued or guaranteed by the U.S.","page_number":153,"box":{"x":116,"y":490,"width":704,"height":12}},{"id":"d75d4760-a6d2-4f4c-a885-c7f988cd415a","block_type":"box","text":"Government or one of its agencies or instrumentalities; and (3) those issued by private issuers that","page_number":153,"box":{"x":117,"y":506,"width":737,"height":12}},{"id":"dc10115e-f3bd-41fd-91ae-0b3377ba864a","block_type":"box","text":"represent an interest in or are collateralized by whole mortgage loans or pass-through securities","page_number":153,"box":{"x":117,"y":521,"width":717,"height":12}},{"id":"ed1d532c-1837-4811-be09-aa3c6ba10b05","block_type":"box","text":"without a government guarantee but that usually have some form of private credit enhancement.","page_number":153,"box":{"x":116,"y":537,"width":720,"height":12}},{"id":"471fce9f-c2f9-475c-bc10-b9c8a6c7310a","block_type":"box","text":"Ginnie Mae is a wholly owned U.S. Government corporation within the Department of Housing and","page_number":153,"box":{"x":117,"y":568,"width":736,"height":12}},{"id":"3c587988-244f-4903-9936-1ec47eef730c","block_type":"box","text":"Urban Development. Ginnie Mae is authorized to guarantee, with the full faith and credit of the U.S.","page_number":153,"box":{"x":117,"y":583,"width":741,"height":12}},{"id":"3f67ce8b-257d-4620-9ed0-ba34663ecd95","block_type":"box","text":"Government, the timely payment of principal and interest on securities issued by the institutions","page_number":153,"box":{"x":117,"y":599,"width":713,"height":12}},{"id":"4fe98949-3de0-4b7d-a38b-f04eda970aad","block_type":"box","text":"approved by Ginnie Mae (such as savings and loan institutions, commercial banks and mortgage","page_number":153,"box":{"x":116,"y":614,"width":725,"height":12}},{"id":"30f30c7f-40c1-4357-b319-9fbcd8899aa9","block_type":"box","text":"banks), and backed by pools of Federal Housing Administration (“FHA”)-insured or Veterans’","page_number":153,"box":{"x":117,"y":630,"width":693,"height":12}},{"id":"5e27761f-2180-44e5-bad9-fc6149bf0c6b","block_type":"box","text":"Administration (“VA”)-guaranteed mortgages. Pass-through certificates guaranteed by Ginnie Mae","page_number":153,"box":{"x":116,"y":645,"width":733,"height":12}},{"id":"ee72b5c3-ab98-4062-9e43-39c336aabea2","block_type":"box","text":"(such certificates are also known as “Ginnie Maes”) are guaranteed as to the timely payment of","page_number":153,"box":{"x":117,"y":661,"width":707,"height":12}},{"id":"5ad8973e-cebc-4360-80f4-f4c8b55f9c0b","block_type":"box","text":"principal and interest by Ginnie Mae, whose guarantee is backed by the full faith and credit of the","page_number":153,"box":{"x":117,"y":676,"width":720,"height":12}},{"id":"b6737a95-9b88-438b-86c1-b9ec99d718e8","block_type":"box","text":"United States. Ginnie Mae certificates also are supported by the authority of Ginnie Mae to borrow","page_number":153,"box":{"x":117,"y":692,"width":729,"height":12}},{"id":"96cda436-8352-41d9-8315-7b0743c26375","block_type":"box","text":"funds from the U.S. Treasury Department to make payments under its guarantee. Mortgage-related","page_number":153,"box":{"x":116,"y":707,"width":737,"height":12}},{"id":"9866e56d-651a-4027-bae7-3ff54bf8d74e","block_type":"box","text":"securities issued by Fannie Mae include Fannie Mae guaranteed Mortgage Pass-Through Certificates","page_number":153,"box":{"x":116,"y":723,"width":756,"height":12}},{"id":"4fd27367-5ab0-4e0d-88f6-f2682e380007","block_type":"box","text":"(also known as “Fannie Maes”), which are guaranteed as to timely payment of principal and interest by","page_number":153,"box":{"x":117,"y":738,"width":761,"height":12}},{"id":"cf12762c-5965-42ef-9b9e-bd66bdb23a8f","block_type":"box","text":"Fannie Mae. They are not backed by or entitled to the full faith and credit of the United States, but are","page_number":153,"box":{"x":117,"y":754,"width":754,"height":12}},{"id":"4062dc2e-b4a8-410b-9088-1a529a41c127","block_type":"box","text":"supported by the right of Fannie Mae to borrow from the U.S. Treasury Department. Fannie Mae was","page_number":153,"box":{"x":116,"y":769,"width":750,"height":12}},{"id":"40b0b575-fe38-4d7e-b6f9-68f33fcc746e","block_type":"box","text":"established as a federal agency in 1938 and in 1968 was chartered by Congress as a private","page_number":153,"box":{"x":116,"y":785,"width":690,"height":12}},{"id":"6d786f4d-14d1-451b-9d6a-ec448b9806e5","block_type":"box","text":"shareholder-owned company. Mortgage-related securities issued by Freddie Mac include Freddie Mac","page_number":153,"box":{"x":116,"y":800,"width":760,"height":12}},{"id":"c2e338e5-0214-4361-927e-a0d5776b9d4e","block_type":"box","text":"Mortgage Participation Certificates (also known as “Freddie Macs” or “PCs”). Freddie Mac is a","page_number":153,"box":{"x":117,"y":816,"width":697,"height":12}},{"id":"218ec59f-2103-4800-967b-54ba8b6b3776","block_type":"box","text":"stockholder-owned corporation chartered by Congress in 1970. Freddie Macs are not guaranteed by","page_number":153,"box":{"x":116,"y":831,"width":750,"height":12}},{"id":"0314aec2-f9cf-4b50-b0e4-eca889b21058","block_type":"box","text":"the United States or by any Federal Home Loan Banks and do not constitute a debt or obligation of the","page_number":153,"box":{"x":116,"y":847,"width":768,"height":12}},{"id":"e8fa3075-0786-4472-9ed6-05f13a2f2dad","block_type":"box","text":"United States or of any Federal Home Loan Bank. Freddie Macs entitle the holder to timely payment of","page_number":153,"box":{"x":117,"y":862,"width":767,"height":12}},{"id":"8b82a66d-6783-4d1f-90af-899981eab2b1","block_type":"box","text":"interest, which is guaranteed by Freddie Mac. Freddie Mac guarantees either ultimate collection or","page_number":153,"box":{"x":117,"y":878,"width":735,"height":12}},{"id":"6df6969d-75e8-47a4-b260-dabb0066ae2c","block_type":"box","text":"II-66","page_number":153,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"bec3f9d5-7afa-450f-a299-a515cd026869","block_type":"box","text":"NM1026U-6004382-153/605","page_number":153,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"d4b1b3ad-3c73-41e0-a172-fcb3300b0a24","block_type":"box","text":"timely payment of all principal payments on the underlying mortgage loans. While Freddie Mac","page_number":154,"box":{"x":116,"y":87,"width":707,"height":12}},{"id":"beb58d31-4a60-477c-bc79-746c44859da1","block_type":"box","text":"generally does not guarantee timely payment of principal, Freddie Mac may remit the amount due on","page_number":154,"box":{"x":116,"y":102,"width":753,"height":13}},{"id":"af68a2d9-a526-486b-b289-2c9cadd098a5","block_type":"box","text":"account of its guarantee of ultimate payment of principal at any time after default on an underlying","page_number":154,"box":{"x":116,"y":118,"width":732,"height":12}},{"id":"4c365684-8c2f-4ee0-84af-005e96c9b4f6","block_type":"box","text":"mortgage, but in no event later than one year after it becomes payable.","page_number":154,"box":{"x":117,"y":134,"width":532,"height":12}},{"id":"9e40a841-74b1-43a5-bfe7-9c07a2352960","block_type":"box","text":"Private mortgage pass-through securities are structured similarly to Ginnie Mae, Fannie Mae, and","page_number":154,"box":{"x":117,"y":168,"width":730,"height":12}},{"id":"9b2be4d9-bb03-46d9-9bed-b4c5d22d3514","block_type":"box","text":"Freddie Mac mortgage pass-through securities and are issued by originators of and investors in","page_number":154,"box":{"x":117,"y":183,"width":714,"height":12}},{"id":"dd0fb75c-ffe0-47d8-8dc6-2f76b9f5c2b8","block_type":"box","text":"mortgage loans, including depository institutions, mortgage banks, investment banks and special","page_number":154,"box":{"x":117,"y":199,"width":722,"height":12}},{"id":"abe0b82d-cfdf-40d8-8c7e-e637df145d47","block_type":"box","text":"purpose subsidiaries of the foregoing.","page_number":154,"box":{"x":117,"y":214,"width":284,"height":12}},{"id":"85db44ac-2d1d-4759-b7ec-e9edd0f04e7b","block_type":"box","text":"Pools created by private mortgage pass-through issuers generally offer a higher rate of interest than","page_number":154,"box":{"x":117,"y":248,"width":747,"height":12}},{"id":"22244321-ed71-4a15-8026-2a8554aaf52f","block_type":"box","text":"government and government-related pools because there are no direct or indirect government or","page_number":154,"box":{"x":116,"y":264,"width":723,"height":12}},{"id":"f0d27ec4-f8f4-4ae1-89d6-4b8ddb3e97f0","block_type":"box","text":"agency guarantees of payments in the private pools. However, timely payment of interest and principal","page_number":154,"box":{"x":116,"y":279,"width":767,"height":12}},{"id":"6ec71887-dcb5-4b38-a5f6-fc39cf28460a","block_type":"box","text":"of these pools may be supported by various forms of insurance or guarantees, including individual","page_number":154,"box":{"x":116,"y":295,"width":732,"height":12}},{"id":"e392dc8f-eda3-4f6d-b7a9-714d625ca4c0","block_type":"box","text":"loan, title, pool and hazard insurance and letters of credit. The insurance and guarantees are issued by","page_number":154,"box":{"x":117,"y":310,"width":769,"height":12}},{"id":"eb78528a-7ccd-4078-b936-0e63c0ecc46d","block_type":"box","text":"governmental entities, private insurers and the mortgage poolers. The insurance and guarantees and","page_number":154,"box":{"x":116,"y":326,"width":756,"height":12}},{"id":"4e35b8a5-9cad-474f-99bb-700d1d18e5c8","block_type":"box","text":"the creditworthiness of the issuers thereof will be considered in determining whether a mortgage","page_number":154,"box":{"x":116,"y":341,"width":720,"height":12}},{"id":"e502b0a2-c08c-4e99-9f11-e282bf4b9a14","block_type":"box","text":"related security meets a Fund’s investment quality standards. There can be no assurance that the","page_number":154,"box":{"x":117,"y":357,"width":731,"height":12}},{"id":"0a40d714-9a39-42ea-87c6-698f702aa751","block_type":"box","text":"private insurers or guarantors can meet their obligations under the insurance policies or guarantee","page_number":154,"box":{"x":117,"y":372,"width":734,"height":12}},{"id":"4449596f-c5b2-4854-9b1e-eecf7869c3bb","block_type":"box","text":"arrangements. Private mortgage pass-through securities may be bought without insurance or","page_number":154,"box":{"x":116,"y":388,"width":696,"height":12}},{"id":"c047a4af-618b-4fdc-9e38-e814eb90b9ad","block_type":"box","text":"guarantees if, through an examination of the loan experience and practices of the originator/servicers","page_number":154,"box":{"x":116,"y":403,"width":756,"height":12}},{"id":"6ad8e8f1-4460-414e-bcbc-0a08a04609a0","block_type":"box","text":"and poolers, the Manager determines that the securities meet a Fund’s quality standards. Any","page_number":154,"box":{"x":116,"y":419,"width":703,"height":12}},{"id":"74f7c75c-fa39-4d89-8ae5-043343c95979","block_type":"box","text":"mortgage-related securities that are issued by private issuers have some exposure to subprime loans","page_number":154,"box":{"x":117,"y":434,"width":757,"height":12}},{"id":"eb6e5a5e-0562-4226-aa88-2080156c4341","block_type":"box","text":"as well as to the mortgage and credit markets generally.","page_number":154,"box":{"x":116,"y":450,"width":422,"height":12}},{"id":"45b26e1f-ecb3-4214-aa2e-b17d9051e6fa","block_type":"box","text":"In addition, mortgage-related securities that are issued by private issuers are not subject to the","page_number":154,"box":{"x":117,"y":484,"width":707,"height":12}},{"id":"3e5ee6a3-a306-4398-8ef0-eec326d4f3f0","block_type":"box","text":"underwriting requirements for the underlying mortgages that are applicable to those mortgage-related","page_number":154,"box":{"x":117,"y":499,"width":757,"height":13}},{"id":"31b5a68f-a95b-4277-8aa2-5cbbea1b293a","block_type":"box","text":"securities that have a government or government-sponsored entity guarantee. As a result, the","page_number":154,"box":{"x":116,"y":515,"width":702,"height":12}},{"id":"0ff8267a-6c11-4c9b-a8b1-2e49425ec7b2","block_type":"box","text":"mortgage loans underlying private mortgage-related securities may, and frequently do, have less","page_number":154,"box":{"x":117,"y":530,"width":722,"height":13}},{"id":"294d7983-aeb4-49ba-b40b-3a719668286c","block_type":"box","text":"favorable collateral, credit risk or other underwriting characteristics than government or government","page_number":154,"box":{"x":116,"y":546,"width":743,"height":12}},{"id":"d87a8421-9a90-40be-9e9b-aaf14ff698bf","block_type":"box","text":"sponsored mortgage-related securities and have wider variances in a number of terms including","page_number":154,"box":{"x":116,"y":561,"width":717,"height":13}},{"id":"e1408031-81bb-4932-b56f-18d89f48f2d9","block_type":"box","text":"interest rate, term, size, purpose and borrower characteristics. Privately issued pools more frequently","page_number":154,"box":{"x":117,"y":577,"width":755,"height":12}},{"id":"52e6e387-8c1d-4858-8445-49138ea6bf69","block_type":"box","text":"include second mortgages, high loan-to-value mortgages and manufactured housing loans. The","page_number":154,"box":{"x":117,"y":592,"width":714,"height":13}},{"id":"f7a16957-ad60-4f5f-b34d-44ca31822657","block_type":"box","text":"coupon rates and maturities of the underlying mortgage loans in a private-label mortgage-related","page_number":154,"box":{"x":116,"y":608,"width":723,"height":12}},{"id":"bb9cd6f6-4309-4781-a95c-4eb345bbd379","block_type":"box","text":"securities pool may vary to a greater extent than those included in a government guaranteed pool, and","page_number":154,"box":{"x":116,"y":624,"width":766,"height":12}},{"id":"35528419-0670-45a0-9e9d-415c209aa4f5","block_type":"box","text":"the pool may include subprime mortgage loans. Subprime loans refer to loans made to borrowers with","page_number":154,"box":{"x":116,"y":639,"width":762,"height":12}},{"id":"466b3f74-1bf3-4f7b-a16b-fbdceb7612e2","block_type":"box","text":"weakened credit histories or with a lower capacity to make timely payments on their loans. For these","page_number":154,"box":{"x":116,"y":655,"width":751,"height":12}},{"id":"39961dae-753e-4641-be1c-2fe91e0bcac0","block_type":"box","text":"reasons, the loans underlying these securities have had in many cases higher default rates than those","page_number":154,"box":{"x":117,"y":670,"width":758,"height":12}},{"id":"6e4901a1-2c0d-44ec-ae4e-2a2bb84d8d1c","block_type":"box","text":"loans that meet government underwriting requirements.","page_number":154,"box":{"x":117,"y":686,"width":410,"height":12}},{"id":"1c5bb0da-9ece-4c6f-b594-8190bc939c3d","block_type":"box","text":"The risk of non-payment is greater for mortgage-related securities that are backed by mortgage pools","page_number":154,"box":{"x":116,"y":720,"width":753,"height":12}},{"id":"98c74d3d-d190-4270-9f30-f62080123642","block_type":"box","text":"that contain subprime loans, but a level of risk exists for all loans. Market factors adversely affecting","page_number":154,"box":{"x":116,"y":735,"width":740,"height":12}},{"id":"2ff6bfee-e501-40a2-b132-7d5b43e7152f","block_type":"box","text":"mortgage loan repayments may include a general economic turndown, high unemployment, a general","page_number":154,"box":{"x":117,"y":751,"width":754,"height":12}},{"id":"958f3906-7032-4695-8656-c60abdfc3bd7","block_type":"box","text":"slowdown in the real estate market, a drop in the market prices of real estate, or an increase in interest","page_number":154,"box":{"x":116,"y":766,"width":763,"height":12}},{"id":"7fb09f84-6a97-41ab-976d-a4ed5a9c18e0","block_type":"box","text":"rates resulting in higher mortgage payments by holders of adjustable rate mortgages.","page_number":154,"box":{"x":117,"y":782,"width":631,"height":12}},{"id":"d89dfecb-120b-4d80-a520-3fa37c3b199c","block_type":"box","text":"Privately issued mortgage-related securities are not traded on an exchange and there may be a limited","page_number":154,"box":{"x":117,"y":816,"width":761,"height":12}},{"id":"a4616572-e54d-4697-8b1b-6d6d27d7f5a6","block_type":"box","text":"market for the securities, especially when there is a perceived weakness in the mortgage and real","page_number":154,"box":{"x":117,"y":831,"width":729,"height":12}},{"id":"54abc1c2-5609-439b-9178-6803033b47a9","block_type":"box","text":"estate market sectors. Without an active trading market, mortgage-related securities held in a Fund’s","page_number":154,"box":{"x":116,"y":847,"width":753,"height":12}},{"id":"1fb8a7d1-2157-4741-b350-2c4d41b02ac7","block_type":"box","text":"portfolio may be particularly difficult to value because of the complexities involved in assessing the","page_number":154,"box":{"x":117,"y":862,"width":734,"height":12}},{"id":"b6087e35-502d-4df9-9fa9-bc7d1f735d75","block_type":"box","text":"value of the underlying mortgage loans.","page_number":154,"box":{"x":116,"y":878,"width":299,"height":12}},{"id":"32fae009-553a-45b3-8223-297e6ec2a24f","block_type":"box","text":"II-67","page_number":154,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"1dd8e20b-3459-4e3f-99e9-a15d54559042","block_type":"box","text":"NM1026U-6004382-154/605","page_number":154,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3efb9f7a-7924-48bc-af17-8423369b34a4","block_type":"box","text":"Collateralized Mortgage Obligations (“CMOs”).","page_number":155,"box":{"x":117,"y":87,"width":343,"height":12}},{"id":"73e2fe47-bd09-4790-bb09-8b012ee2240f","block_type":"box","text":"CMOs are debt obligations collateralized by residential","page_number":155,"box":{"x":462,"y":87,"width":415,"height":12}},{"id":"c1c8a9d7-c7ea-45c7-8a30-7156bd0a0e7b","block_type":"box","text":"or commercial mortgage loans or residential or commercial mortgage pass-through securities. Interest","page_number":155,"box":{"x":116,"y":103,"width":762,"height":12}},{"id":"9ac1ff41-98e6-46c9-ba88-fff9888c89d3","block_type":"box","text":"and prepaid principal are generally paid monthly. CMOs may be collateralized by whole mortgage","page_number":155,"box":{"x":116,"y":118,"width":729,"height":12}},{"id":"70769491-08a4-43d4-8ce3-f388cc0f7319","block_type":"box","text":"loans or private mortgage pass-through securities but are more typically collateralized by portfolios of","page_number":155,"box":{"x":117,"y":134,"width":755,"height":12}},{"id":"c13ba620-834d-4fac-b667-51992fe8ff49","block_type":"box","text":"mortgage pass-through securities guaranteed by Ginnie Mae, Freddie Mac, or Fannie Mae. The issuer","page_number":155,"box":{"x":117,"y":149,"width":765,"height":12}},{"id":"f179964e-9365-42c7-940a-45f436d016ef","block_type":"box","text":"of a series of CMOs may elect to be treated as a Real Estate Mortgage Investment Conduit (“REMIC”).","page_number":155,"box":{"x":116,"y":165,"width":769,"height":12}},{"id":"541d856f-a243-4109-8ca9-8c14856a428e","block_type":"box","text":"All future references to CMOs also include REMICs.","page_number":155,"box":{"x":116,"y":180,"width":392,"height":10}},{"id":"ac49602b-3a40-4541-a6b2-e191c0d70053","block_type":"box","text":"CMOs are structured into multiple classes, often referred to as a “tranche,” each issued at a specific","page_number":155,"box":{"x":117,"y":211,"width":746,"height":12}},{"id":"6b3f410f-8eee-4a64-873f-42f005c3fee6","block_type":"box","text":"adjustable or fixed interest rate, and bearing a different stated maturity date and each must be fully","page_number":155,"box":{"x":116,"y":227,"width":738,"height":12}},{"id":"57a0642c-ee14-449a-911c-b6bff190cbd4","block_type":"box","text":"retired no later than its final distribution date. Actual maturity and average life will depend upon the","page_number":155,"box":{"x":117,"y":242,"width":734,"height":12}},{"id":"092d9b7b-4d5a-4f57-a85c-3863f8bd905c","block_type":"box","text":"prepayment experience of the collateral, which is ordinarily unrelated to the stated maturity date.","page_number":155,"box":{"x":117,"y":258,"width":719,"height":12}},{"id":"b67011c3-5345-49f9-84dd-acb2ff70591b","block_type":"box","text":"CMOs often provide for a modified form of call protection through a de facto breakdown of the","page_number":155,"box":{"x":117,"y":273,"width":700,"height":12}},{"id":"fd7ba223-5912-4e65-9265-8947dc2ebd0b","block_type":"box","text":"underlying pool of mortgages according to how quickly the loans are repaid. Monthly payment of","page_number":155,"box":{"x":117,"y":289,"width":718,"height":12}},{"id":"84bdc7c0-65c6-42ec-9b46-3bed9b32882c","block_type":"box","text":"principal received from the pool of underlying mortgages, including prepayments, is first returned to","page_number":155,"box":{"x":117,"y":304,"width":740,"height":12}},{"id":"f7c75b35-065e-4104-80f0-9bd392a20d76","block_type":"box","text":"investors holding the shortest maturity class. Investors holding the longer maturity classes usually","page_number":155,"box":{"x":117,"y":320,"width":729,"height":12}},{"id":"b263d743-1d2b-4eb2-a503-76cabb6d5d8f","block_type":"box","text":"receive principal only after the first class has been retired. An investor may be partially protected","page_number":155,"box":{"x":117,"y":335,"width":719,"height":12}},{"id":"dd6d3683-2523-4e61-9ff1-bcc02527fada","block_type":"box","text":"against a sooner than desired return of principal because of the sequential payments.","page_number":155,"box":{"x":116,"y":351,"width":640,"height":12}},{"id":"d3a1d2b3-3775-439c-87f4-5b6966d9df59","block_type":"box","text":"Certain issuers of CMOs are not considered investment companies pursuant to a rule adopted by the","page_number":155,"box":{"x":117,"y":382,"width":755,"height":12}},{"id":"f6fde3b7-1878-42a9-ab94-b25697ec53d0","block_type":"box","text":"Commission, and a Fund may invest in the securities of such issuers without the limitations imposed by","page_number":155,"box":{"x":117,"y":397,"width":771,"height":12}},{"id":"e0cb8a4e-e020-4fe7-a6c2-a3af08dae624","block_type":"box","text":"the Investment Company Act on investments by a Fund in other investment companies. In addition, in","page_number":155,"box":{"x":116,"y":413,"width":761,"height":12}},{"id":"4593b0b1-b128-4487-9e1e-29d14445e230","block_type":"box","text":"reliance on an earlier Commission interpretation, a Fund’s investments in certain other qualifying","page_number":155,"box":{"x":117,"y":428,"width":721,"height":12}},{"id":"ebf53592-35a3-4b24-a778-cd1ac2ce61de","block_type":"box","text":"CMOs, which cannot or do not rely on the rule, are also not subject to the limitation of the Investment","page_number":155,"box":{"x":117,"y":444,"width":753,"height":12}},{"id":"ca8c607a-b823-4fd2-a8c4-601c85f1ac18","block_type":"box","text":"Company Act on acquiring interests in other investment companies. In order to be able to rely on the","page_number":155,"box":{"x":117,"y":459,"width":750,"height":12}},{"id":"f31563f7-670a-4f4e-aa4a-97c80998613e","block_type":"box","text":"Commission’s interpretation, these CMOs must be unmanaged, fixed asset issuers, that: (1) invest","page_number":155,"box":{"x":117,"y":475,"width":736,"height":12}},{"id":"95b043f7-1ad0-4c7d-be3e-d4cfdbd4d78e","block_type":"box","text":"primarily in mortgage-backed securities; (2) do not issue redeemable securities; (3) operate under","page_number":155,"box":{"x":117,"y":490,"width":730,"height":12}},{"id":"3bfed8e9-9a9b-449a-94ca-d0e140c11dcd","block_type":"box","text":"general exemptive orders exempting them from all provisions of the Investment Company Act; and","page_number":155,"box":{"x":116,"y":506,"width":736,"height":12}},{"id":"b410fa64-f121-4951-bb34-ea6dde86c1bc","block_type":"box","text":"(4) are not registered or regulated under the Investment Company Act as investment companies. To","page_number":155,"box":{"x":117,"y":521,"width":748,"height":12}},{"id":"b7bbe4af-2467-439c-a3d5-bd4ac3501236","block_type":"box","text":"the extent that a Fund selects CMOs that cannot rely on the rule or do not meet the above","page_number":155,"box":{"x":116,"y":537,"width":674,"height":12}},{"id":"0b1eb54a-6a84-444d-8e89-36614d002e02","block_type":"box","text":"requirements, the Fund may not invest more than 10% of its assets in all such entities and may not","page_number":155,"box":{"x":117,"y":552,"width":738,"height":12}},{"id":"6edc25c2-5c62-4722-b886-ae045e107099","block_type":"box","text":"acquire more than 3% of the voting securities of any single such entity.","page_number":155,"box":{"x":116,"y":568,"width":530,"height":12}},{"id":"c8e4ec4b-eb23-4b68-9c4b-18752aa64226","block_type":"box","text":"A Fund may also invest in, among other things, parallel pay CMOs, sequential pay CMOs, and floating","page_number":155,"box":{"x":116,"y":599,"width":765,"height":12}},{"id":"5f5eb66a-1ab5-4a2e-bdae-f6e2338f64f5","block_type":"box","text":"rate CMOs. Parallel pay CMOs are structured to provide payments of principal on each payment date","page_number":155,"box":{"x":117,"y":614,"width":757,"height":12}},{"id":"9237d57f-6dd1-4f74-a465-79f86c312e6e","block_type":"box","text":"to more than one class, concurrently on a proportionate or disproportionate basis. These simultaneous","page_number":155,"box":{"x":116,"y":630,"width":766,"height":12}},{"id":"2b408cca-ba0e-48e8-b19c-3a4bc4ad9100","block_type":"box","text":"payments are taken into account in calculating the final distribution date of each class. Sequential pay","page_number":155,"box":{"x":117,"y":645,"width":759,"height":12}},{"id":"01154748-21f6-49ce-8970-d6091221c10d","block_type":"box","text":"CMOs generally pay principal to only one class at a time while paying interest to several classes. A","page_number":155,"box":{"x":117,"y":661,"width":734,"height":12}},{"id":"ade64254-0915-4243-afd7-f01334fe438f","block_type":"box","text":"wide variety of REMIC Certificates may be issued in the parallel pay or sequential pay structures.","page_number":155,"box":{"x":116,"y":676,"width":719,"height":12}},{"id":"d7088054-82f1-4b8e-82ee-bbb426261c1f","block_type":"box","text":"These securities include accrual certificates (also known as “Z-Bonds”), which only accrue interest at a","page_number":155,"box":{"x":116,"y":692,"width":761,"height":12}},{"id":"089350d7-ce85-4964-b29e-b59e56fa40ab","block_type":"box","text":"specified rate until all other certificates having an earlier final distribution date have been retired and","page_number":155,"box":{"x":116,"y":707,"width":740,"height":12}},{"id":"3d48a526-aa73-4fcc-b7f2-8194b55738dc","block_type":"box","text":"are converted thereafter to an interest-paying security. Floating rate CMOs are securities whose","page_number":155,"box":{"x":116,"y":723,"width":712,"height":12}},{"id":"7e217356-fd15-4c99-b512-2e6731e34433","block_type":"box","text":"coupon rate fluctuates according to some formula related to an existing market index or rate. Typical","page_number":155,"box":{"x":116,"y":738,"width":745,"height":12}},{"id":"bb3803bc-af53-410d-a88d-ab6fd65178a6","block_type":"box","text":"indices would include the eleventh district cost-of-funds index (“COFI”), one-year Treasury yields, and","page_number":155,"box":{"x":117,"y":754,"width":753,"height":12}},{"id":"4e1cabad-821f-4fa1-9fed-898d58fe2781","block_type":"box","text":"ten-year Treasury yields.","page_number":155,"box":{"x":116,"y":769,"width":184,"height":12}},{"id":"8ae55638-89c3-426f-ba33-22bb7beb5226","block_type":"box","text":"Classes of CMOs also include planned amortization","page_number":155,"box":{"x":117,"y":800,"width":375,"height":12}},{"id":"7b44fc1b-af71-4308-872a-997164eaa6bb","block_type":"box","text":"classes (“PACs”) and targeted amortization classes","page_number":155,"box":{"x":498,"y":800,"width":373,"height":12}},{"id":"81aee8f8-3e49-4831-aa29-b8e3fb87e523","block_type":"box","text":"(“TACs”). PAC bonds generally require payments of a s","page_number":155,"box":{"x":117,"y":816,"width":402,"height":12}},{"id":"706842ed-63f2-42ec-adc2-71018689da2b","block_type":"box","text":"pecified amount of principal on each payment","page_number":155,"box":{"x":521,"y":816,"width":330,"height":12}},{"id":"3596072a-07fd-4b09-b563-a89b0ceac352","block_type":"box","text":"date. The scheduled principal payments for PAC Certifi","page_number":155,"box":{"x":116,"y":831,"width":399,"height":12}},{"id":"b942972f-a7f4-4f9b-a584-9528a3bb7753","block_type":"box","text":"cates generally have the highest priority on each","page_number":155,"box":{"x":517,"y":831,"width":357,"height":12}},{"id":"a61b0282-4783-4688-9e85-315cb8097905","block_type":"box","text":"payment date after interest due has been paid to all","page_number":155,"box":{"x":117,"y":847,"width":378,"height":12}},{"id":"bc98c843-7e1a-44cd-b21a-23d4301ac16a","block_type":"box","text":"classes entitled to receive interest currently.","page_number":155,"box":{"x":496,"y":847,"width":323,"height":12}},{"id":"ea060ec4-f818-446d-8753-121e93647e78","block_type":"box","text":"Shortfalls, if any, are added to the amount payabl","page_number":155,"box":{"x":116,"y":862,"width":357,"height":12}},{"id":"2a39111e-2c55-4056-9597-2724b0fb2141","block_type":"box","text":"e on the next payment date. The PAC Certificate","page_number":155,"box":{"x":475,"y":862,"width":358,"height":12}},{"id":"024ab6b6-6ded-4ae6-b85f-936ad635c10f","block_type":"box","text":"payment schedule is taken into account in calculating t","page_number":155,"box":{"x":117,"y":878,"width":391,"height":12}},{"id":"e0c46866-06e4-4feb-a54b-1eca7e0ef152","block_type":"box","text":"the final distribution date of each class of PAC. In","page_number":155,"box":{"x":508,"y":878,"width":363,"height":9}},{"id":"0e2d5c63-4e94-4736-b518-6ec153c68e89","block_type":"box","text":"II-68","page_number":155,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"c29e5f2a-d581-44c2-bbab-271d900a16bc","block_type":"box","text":"NM1026U-6004382-155/605","page_number":155,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"86addac1-7d67-4113-91ce-45453faf60cf","block_type":"box","text":"order to create PAC tranches, one or more tranches gener","page_number":156,"box":{"x":116,"y":87,"width":426,"height":12}},{"id":"537ba8bb-3285-48f0-8d1e-001ce12dedec","block_type":"box","text":"ally must be created that absorb most of the","page_number":156,"box":{"x":542,"y":87,"width":325,"height":12}},{"id":"01b5d2d6-4d1f-40d9-9059-28e8f1826686","block_type":"box","text":"volatility in the underlying mortgage assets. These","page_number":156,"box":{"x":116,"y":103,"width":369,"height":12}},{"id":"be1d9e4a-084b-4050-905a-d306cfd1fe5e","block_type":"box","text":"tranches (often called “supports” or “companion”","page_number":156,"box":{"x":485,"y":102,"width":356,"height":13}},{"id":"db2f5319-6329-42cd-ba7b-9d791208ef91","block_type":"box","text":"tranches) tend to have market prices and yields t","page_number":156,"box":{"x":116,"y":118,"width":350,"height":12}},{"id":"19007413-e19c-4f97-8bed-4e1739567448","block_type":"box","text":"that are more volatile than the PAC classes.","page_number":156,"box":{"x":466,"y":118,"width":325,"height":10}},{"id":"e83d30b0-f8c1-4d2a-a756-7083db176df9","block_type":"box","text":"TACs are similar to PACs in that they require that specified amounts of principal be applied on each","page_number":156,"box":{"x":116,"y":149,"width":745,"height":12}},{"id":"5446122a-be7c-4d5e-9ec1-d61b4b1b64a4","block_type":"box","text":"payment date to one or more classes of REMIC Certificates. A PAC’s payment schedule, however,","page_number":156,"box":{"x":117,"y":165,"width":738,"height":12}},{"id":"50a3329e-fcd5-4f2c-adc5-4e467d2e59f3","block_type":"box","text":"remains in effect as long as prepayment rates on the underlying mortgages do not exceed certain","page_number":156,"box":{"x":117,"y":180,"width":728,"height":12}},{"id":"1c3277c5-6eca-4ce3-a206-c345fc02dfae","block_type":"box","text":"ranges. In contrast, a TAC provides investors with protection, to a certain level, against either faster","page_number":156,"box":{"x":117,"y":196,"width":743,"height":12}},{"id":"2909bf68-487f-41ae-af21-cabf44c0a9dc","block_type":"box","text":"than expected or slower than expected prepayment rates, but not both. TACs thus provide more cash","page_number":156,"box":{"x":116,"y":211,"width":759,"height":12}},{"id":"7479b42c-be37-4c2e-aff5-a9d199e7c7f8","block_type":"box","text":"flow stability than a regular sequential paying class, but less than a PAC. TACs also tend to have","page_number":156,"box":{"x":116,"y":227,"width":725,"height":12}},{"id":"99691d86-f9a8-43ba-9492-209e52ac0d12","block_type":"box","text":"market prices and yields that are more volatile than PACs.","page_number":156,"box":{"x":117,"y":242,"width":437,"height":12}},{"id":"edf3ebc1-5cec-4ef4-b8e5-03172d0ad62c","block_type":"box","text":"Adjustable Rate Mortgage Securities.","page_number":156,"box":{"x":115,"y":273,"width":277,"height":12}},{"id":"32327f83-94b9-43b3-8a86-f754dc9ec100","block_type":"box","text":"Adjustable rate mortgage securities (“ARMs”) are pass-through","page_number":156,"box":{"x":393,"y":273,"width":479,"height":12}},{"id":"12d3da3a-0363-48b7-8f6b-1f8d3bdd0bc6","block_type":"box","text":"securities collateralized by mortgages with adjustable rather than fixed rates. ARMs eligible for","page_number":156,"box":{"x":116,"y":289,"width":706,"height":12}},{"id":"a432206f-9a91-48d0-aee7-c294efb4fb0d","block_type":"box","text":"inclusion in a mortgage pool generally provide for a fixed initial mortgage interest rate for a set number","page_number":156,"box":{"x":117,"y":304,"width":764,"height":12}},{"id":"b74b62d3-e990-43ac-8849-6f817558dd27","block_type":"box","text":"of scheduled monthly payments. After that schedule of payments has been completed, the interest","page_number":156,"box":{"x":116,"y":320,"width":736,"height":12}},{"id":"141ee1a6-4fc9-414c-b96e-bf6515458003","block_type":"box","text":"rates are subject to periodic adjustment based on changes to a designated benchmark index.","page_number":156,"box":{"x":117,"y":335,"width":697,"height":12}},{"id":"de5d825c-9e57-44fc-ba1f-ed162dfbcf2b","block_type":"box","text":"ARMs contain maximum and minimum rates beyond which the mortgage interest rate may not vary","page_number":156,"box":{"x":116,"y":366,"width":741,"height":12}},{"id":"09c8112a-1902-4575-9d01-8613165460b2","block_type":"box","text":"over the lifetime of the security. In addition, certain ARMs provide for additional limitations on the","page_number":156,"box":{"x":116,"y":382,"width":722,"height":12}},{"id":"cde06e6e-cd17-4211-a959-3d632c75ea4c","block_type":"box","text":"maximum amount by which the mortgage interest rate may adjust for any single adjustment period. In","page_number":156,"box":{"x":117,"y":397,"width":758,"height":12}},{"id":"5e07c4d3-e1f8-4ec2-8065-b2e679a7ffa6","block_type":"box","text":"the event that market rates of interest rise more rapidly to levels above that of the ARM’s maximum","page_number":156,"box":{"x":116,"y":413,"width":741,"height":12}},{"id":"f80bb781-7916-480f-90b0-428a8c43c559","block_type":"box","text":"rate, the ARM’s coupon may represent a below market rate of interest. In these circumstances, the","page_number":156,"box":{"x":117,"y":428,"width":737,"height":12}},{"id":"d3b05227-8649-4392-a8b1-3c406cb43a23","block_type":"box","text":"market value of the ARM security will likely have fallen.","page_number":156,"box":{"x":117,"y":444,"width":412,"height":12}},{"id":"31839e02-618b-48cb-b4ff-9928ba338a68","block_type":"box","text":"Certain ARMs contain limitations on changes in the required monthly payment. In the event that a","page_number":156,"box":{"x":117,"y":475,"width":728,"height":12}},{"id":"63de8b56-2ad4-47a2-abc2-9e920789c6d1","block_type":"box","text":"monthly payment is not sufficient to pay the interest accruing on an ARM, any such excess interest is","page_number":156,"box":{"x":117,"y":490,"width":754,"height":12}},{"id":"0cc86d6b-94fc-463e-946d-063ea29f9657","block_type":"box","text":"added to the principal balance of the mortgage loan, which is repaid through future monthly payments.","page_number":156,"box":{"x":116,"y":506,"width":764,"height":12}},{"id":"fed186f9-0918-4b00-a714-fa9efaaf368c","block_type":"box","text":"If the monthly payment for such an instrument exceeds the sum of the interest accrued at the","page_number":156,"box":{"x":117,"y":521,"width":695,"height":12}},{"id":"a510597d-b9c8-4832-b51e-54f63ecb6072","block_type":"box","text":"applicable mortgage interest rate and the principal payment required at such point to amortize the","page_number":156,"box":{"x":116,"y":537,"width":730,"height":12}},{"id":"221ef229-335e-4d71-a975-052900129391","block_type":"box","text":"outstanding principal balance over the remaining term of the loan, the excess is then used to reduce","page_number":156,"box":{"x":116,"y":552,"width":748,"height":12}},{"id":"ed28774a-bdf4-45e6-9419-a259307543c2","block_type":"box","text":"the outstanding principal balance of the ARM.","page_number":156,"box":{"x":116,"y":568,"width":344,"height":12}},{"id":"f1c6df24-14b7-41ae-8390-d86c449e7a67","block_type":"box","text":"CMO Residuals.","page_number":156,"box":{"x":117,"y":599,"width":120,"height":9}},{"id":"a10223ee-68f3-4904-ad5e-70ddb3ac72ed","block_type":"box","text":"CMO residuals are derivative mortgage securities issued by agencies or","page_number":156,"box":{"x":238,"y":599,"width":546,"height":12}},{"id":"d20facda-c14b-4b32-be68-00f3d4e0bf01","block_type":"box","text":"instrumentalities of the U.S. Government or by private originators of, or investors in, mortgage loans,","page_number":156,"box":{"x":117,"y":614,"width":750,"height":12}},{"id":"5fa9cfc3-31b4-480f-8a2c-bd9c4dd1a643","block_type":"box","text":"including savings and loan associations, homebuilders, mortgage banks, commercial banks,","page_number":156,"box":{"x":117,"y":630,"width":688,"height":12}},{"id":"a06958ad-6d28-4330-9e40-0cf0e1a84b96","block_type":"box","text":"investment banks, and special purpose entities of the foregoing. The cash flow generated by the","page_number":156,"box":{"x":117,"y":645,"width":718,"height":12}},{"id":"368a39a6-f9ef-4d71-bc7b-af15b27fc20c","block_type":"box","text":"mortgage assets underlying a series of CMOs is applied first to make required payments of principal","page_number":156,"box":{"x":117,"y":661,"width":742,"height":12}},{"id":"78f5985f-56f5-44de-818a-bffc851ff376","block_type":"box","text":"and interest on the CMOs and second to pay the related administrative expenses and any","page_number":156,"box":{"x":116,"y":676,"width":668,"height":12}},{"id":"cd06a30e-3db4-4bbd-b672-73b2023e302d","block_type":"box","text":"management fees of the issuer. The residual in a CMO structure generally represents the interest in","page_number":156,"box":{"x":117,"y":692,"width":740,"height":12}},{"id":"f575d00a-4c1d-46e9-8d1f-c8d77bd988e2","block_type":"box","text":"any excess cash flow remaining after making the foregoing payments. Each payment of such excess","page_number":156,"box":{"x":116,"y":707,"width":748,"height":12}},{"id":"8a3e1b2d-c7a5-4961-831e-a413e618f76a","block_type":"box","text":"cash flow to a holder of the related CMO residual represents income and/or a return of capital. The","page_number":156,"box":{"x":116,"y":723,"width":733,"height":12}},{"id":"04cc3501-68af-4fc6-9ff1-3b04167921f6","block_type":"box","text":"amount of residual cash flow resulting from a CMO will depend on, among other things, the","page_number":156,"box":{"x":116,"y":738,"width":676,"height":12}},{"id":"beefd0d7-7769-45ee-8248-fc345526293f","block_type":"box","text":"characteristics of the mortgage assets, the coupon rate of each class of CMO, prevailing interest rates,","page_number":156,"box":{"x":116,"y":754,"width":762,"height":12}},{"id":"b61b9d24-d8e0-4197-9b4c-eeb4ad18f92a","block_type":"box","text":"the amount of administrative expenses and the prepayment experience on the mortgage assets. In","page_number":156,"box":{"x":116,"y":769,"width":732,"height":12}},{"id":"9e9bb939-ebd9-4e06-8213-0b5c77aaac99","block_type":"box","text":"part, the yield to maturity on the CMO residuals is extremely sensitive to prepayments on the related","page_number":156,"box":{"x":117,"y":785,"width":743,"height":12}},{"id":"074d18ac-4b84-429f-94c6-3257b4256d03","block_type":"box","text":"underlying mortgage assets, in the same manner as an interest-only class of stripped mortgage-related","page_number":156,"box":{"x":117,"y":800,"width":764,"height":12}},{"id":"17b76b97-3787-48f1-b98a-fb220549f248","block_type":"box","text":"securities. In addition, if a series of a CMO includes a class that bears interest at an adjustable rate,","page_number":156,"box":{"x":116,"y":816,"width":739,"height":12}},{"id":"3ebc5a56-38d2-4c7c-878d-37ab0604b2f4","block_type":"box","text":"the yield to maturity on the related CMO residual will also be extremely sensitive to changes in the","page_number":156,"box":{"x":116,"y":831,"width":733,"height":12}},{"id":"9e148909-b1b9-4f17-8734-0123ecec09a4","block_type":"box","text":"level of the index upon which interest rate adjustments are based. In certain circumstances, a Fund","page_number":156,"box":{"x":117,"y":847,"width":741,"height":12}},{"id":"00ede81b-5549-428c-bd05-e1b26b23dd21","block_type":"box","text":"may fail to recoup fully its initial investment in a CMO residual.","page_number":156,"box":{"x":117,"y":862,"width":466,"height":12}},{"id":"6b2eb0aa-96f2-477c-8b63-6c7b487ccb40","block_type":"box","text":"II-69","page_number":156,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"02baabe3-b6bb-4a92-94cf-21ea6edc4d40","block_type":"box","text":"NM1026U-6004382-156/605","page_number":156,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"eb17e0f9-4e21-4808-8b81-37d62f608b40","block_type":"box","text":"CMO residuals are generally purchased and sold by institutional investors through one or more","page_number":157,"box":{"x":117,"y":87,"width":709,"height":12}},{"id":"bc76b24b-0044-4104-9f13-a896bf749a9c","block_type":"box","text":"investment banking firms acting as brokers or dealers. Transactions in CMO residuals are generally","page_number":157,"box":{"x":117,"y":102,"width":744,"height":13}},{"id":"5fd796f1-c628-48b0-9b80-bc084b5c9d7c","block_type":"box","text":"completed only after careful review of the characteristics of the securities in question. In addition, CMO","page_number":157,"box":{"x":116,"y":118,"width":768,"height":12}},{"id":"993532ac-e26d-4e5a-ba5a-90304fc461b4","block_type":"box","text":"residuals may or, pursuant to an exemption therefrom, may not have been registered under the","page_number":157,"box":{"x":117,"y":134,"width":711,"height":12}},{"id":"c5f754d8-1010-4fe8-a69c-c02706838810","block_type":"box","text":"Securities Act. Residual interests generally are junior to, and may be significantly more volatile than,","page_number":157,"box":{"x":116,"y":149,"width":748,"height":12}},{"id":"3421860c-b30c-4eeb-a176-b3bb82b44900","block_type":"box","text":"“regular” CMO and REMIC interests. CMO residuals, whether or not registered under the Securities","page_number":157,"box":{"x":116,"y":165,"width":744,"height":12}},{"id":"d5bcdb1e-52a0-466c-9d83-7a388d86ceaf","block_type":"box","text":"Act, may be subject to certain restrictions on transferability.","page_number":157,"box":{"x":116,"y":180,"width":444,"height":12}},{"id":"bbf257c0-6fed-4562-8b97-133d7480fcbc","block_type":"box","text":"Stripped Mortgage-Backed Securities.","page_number":157,"box":{"x":117,"y":207,"width":280,"height":12}},{"id":"9d4c606c-a2c8-4e76-942e-5a7217840497","block_type":"box","text":"A Fund may invest in stripped mortgage-backed securities","page_number":157,"box":{"x":399,"y":207,"width":443,"height":12}},{"id":"b0c3eedc-532c-484c-bb6f-9a9a3eb9577f","block_type":"box","text":"(“SMBSs”) issued by agencies or instrumentalities of the United States. SMBSs are derivative multi","page_number":157,"box":{"x":117,"y":223,"width":740,"height":12}},{"id":"af13b3e1-360c-4f04-a054-bf0946f84df0","block_type":"box","text":"class mortgage-backed securities. SMBS arrangements commonly involve two classes of securities","page_number":157,"box":{"x":116,"y":238,"width":744,"height":12}},{"id":"1ec69f73-fd8b-47ab-9c67-ca958b181cd4","block_type":"box","text":"that receive different proportions of the interest and principal distributions on a pool of mortgage","page_number":157,"box":{"x":116,"y":254,"width":716,"height":12}},{"id":"c7aa1a3b-011e-4bc1-afaa-86a86d3c60ad","block_type":"box","text":"assets. A common variety of SMBS is where one class (the principal only or PO class) receives some","page_number":157,"box":{"x":116,"y":269,"width":759,"height":12}},{"id":"b49b20e2-8788-409b-a4b1-7b786e5f181e","block_type":"box","text":"of the interest and most of the principal from the underlying assets, while the other class (the interest","page_number":157,"box":{"x":116,"y":285,"width":752,"height":12}},{"id":"8894ec34-73a8-4492-8d09-0aa90a29afe0","block_type":"box","text":"only or IO class) receives most of the interest and the remainder of the principal. In the most extreme","page_number":157,"box":{"x":116,"y":300,"width":755,"height":12}},{"id":"86614904-b74a-47ca-8bed-27c1b07f77f0","block_type":"box","text":"case, the IO class receives all of the interest, while","page_number":157,"box":{"x":116,"y":316,"width":382,"height":11}},{"id":"a8fdacab-8dda-43a2-b483-80bff565fef2","block_type":"box","text":"the PO class receives all of the principal. While a","page_number":157,"box":{"x":498,"y":316,"width":368,"height":12}},{"id":"0cd83969-51a2-4601-95b8-ca068432856a","block_type":"box","text":"Fund may purchase securities of a PO class, a Fund is more likely to purchase the securities of an IO","page_number":157,"box":{"x":117,"y":331,"width":758,"height":12}},{"id":"a56bae5c-25aa-4732-a685-bbe7c260bf61","block_type":"box","text":"class. The yield to maturity of an IO class is extremely sensitive to the rate of principal payments","page_number":157,"box":{"x":116,"y":347,"width":720,"height":12}},{"id":"41ad345a-d74a-4e9e-bcbb-6c5a178e364b","block_type":"box","text":"(including prepayments) on the related underlying assets, and a rapid rate of principal prepayments in","page_number":157,"box":{"x":117,"y":362,"width":759,"height":12}},{"id":"b709d8c8-a71b-4c93-aaf0-ab03ed68a81e","block_type":"box","text":"excess of that considered in pricing the securities will have a material adverse effect on an IO","page_number":157,"box":{"x":116,"y":378,"width":699,"height":12}},{"id":"60e31f75-6112-41a1-8e93-bcb929e84439","block_type":"box","text":"security’s yield to maturity. If the underlying mortgage assets experience greater than anticipated","page_number":157,"box":{"x":116,"y":393,"width":724,"height":12}},{"id":"5c9f7b2f-dc62-4ab3-8fd6-60648ce93ceb","block_type":"box","text":"payments of principal, a Fund may fail to recoup fully its initial investment in IOs. In addition, there are","page_number":157,"box":{"x":117,"y":409,"width":760,"height":12}},{"id":"3bb0a793-bb30-4d25-8954-3086a781bd6d","block_type":"box","text":"certain types of IOs that represent the interest portion of a particular class as opposed to the interest","page_number":157,"box":{"x":116,"y":424,"width":751,"height":12}},{"id":"6ac2fb81-e55e-4455-a373-c5196d529bd3","block_type":"box","text":"portion of the entire pool. The sensitivity of this type of IO to interest rate fluctuations may be increased","page_number":157,"box":{"x":117,"y":440,"width":768,"height":12}},{"id":"2d49e003-5c65-438e-a48a-6fead245562c","block_type":"box","text":"because of the characteristics of the principal portion to which they relate. As a result of the above","page_number":157,"box":{"x":117,"y":455,"width":733,"height":12}},{"id":"20cf2c29-5080-4592-a184-e79bf9d046e9","block_type":"box","text":"factors, a Fund generally will purchase IOs only as a component of so called “synthetic” securities. This","page_number":157,"box":{"x":116,"y":471,"width":772,"height":12}},{"id":"5a4b5808-6c64-4c9b-b442-3ed3c0181d67","block_type":"box","text":"means that purchases of IOs will be matched with certain purchases of other securities, such as POs,","page_number":157,"box":{"x":117,"y":486,"width":759,"height":12}},{"id":"83df43b1-37b1-4de0-8d7b-af9bb2cdd860","block_type":"box","text":"inverse floating rate CMOs or fixed rate securities; as interest rates fall, presenting a greater risk of","page_number":157,"box":{"x":117,"y":502,"width":737,"height":12}},{"id":"b1f0973e-0cf7-436b-bd42-d2a1b1ecde2d","block_type":"box","text":"unanticipated prepayments of principal, the negative effect on a Fund because of its holdings of IOs","page_number":157,"box":{"x":117,"y":517,"width":744,"height":12}},{"id":"420551c8-b49c-44ca-a6f9-65e9b3a7e194","block_type":"box","text":"should be diminished somewhat because of the increased yield on the inverse floating rate CMOs or","page_number":157,"box":{"x":116,"y":533,"width":751,"height":12}},{"id":"678a77f6-e07d-477d-8396-bec3ccdce549","block_type":"box","text":"the increased appreciation on the POs or fixed rate securities.","page_number":157,"box":{"x":116,"y":548,"width":465,"height":12}},{"id":"369cf1ad-96c5-4fba-845c-fad78f2a4fc0","block_type":"box","text":"Tiered Index Bonds.","page_number":157,"box":{"x":118,"y":576,"width":147,"height":9}},{"id":"23455efa-d913-4361-b063-7c710f4aa679","block_type":"box","text":"Tiered index bonds are forms of mortgage-related securities. The interest rate on","page_number":157,"box":{"x":266,"y":575,"width":612,"height":12}},{"id":"c869520a-9f70-4ece-b5e3-29bb2f8f6ae8","block_type":"box","text":"a tiered index bond is tied to a specified index or","page_number":157,"box":{"x":116,"y":591,"width":365,"height":12}},{"id":"5ee28fee-0d44-425b-9d3d-992c4328627f","block_type":"box","text":"market rate. So long as this index or market rate is","page_number":157,"box":{"x":482,"y":591,"width":380,"height":12}},{"id":"86c95865-809f-4ba5-8962-fa376c5d1f55","block_type":"box","text":"below a predetermined “strike” rate, the interest rate on the tiered index bond remains fixed. If,","page_number":157,"box":{"x":117,"y":606,"width":704,"height":12}},{"id":"67542ae1-198d-4848-a34c-6507ee4bbdfc","block_type":"box","text":"however, the specified index or market rate rises above the “strike” rate, the interest rate of the tiered","page_number":157,"box":{"x":117,"y":622,"width":754,"height":12}},{"id":"1b196f8d-8600-4c20-bcf9-586bdb33fa6f","block_type":"box","text":"index bond will decrease. Thus, under these circumstances, the interest rate on a tiered index bond,","page_number":157,"box":{"x":117,"y":638,"width":747,"height":11}},{"id":"99935d41-5c28-4ef7-abf6-c2bd7bc0bd59","block_type":"box","text":"like an inverse floater, will move in the opposite direction of prevailing interest rates, with the result that","page_number":157,"box":{"x":117,"y":653,"width":767,"height":12}},{"id":"f1bea33a-6dff-4439-bbaf-05f673607341","block_type":"box","text":"the price of the tiered index bond may be considerably more volatile than that of a fixed-rate bond.","page_number":157,"box":{"x":116,"y":668,"width":727,"height":12}},{"id":"751ea7cc-5a94-4ea4-bffd-49650db6fc6b","block_type":"box","text":"TBA Commitments.","page_number":157,"box":{"x":118,"y":696,"width":142,"height":9}},{"id":"3db5216c-3d85-4ab9-9ed9-e29c5600bec3","block_type":"box","text":"Certain Funds may enter into “to be announced” or “TBA” commitments. TBA","page_number":157,"box":{"x":267,"y":696,"width":573,"height":12}},{"id":"ffbd9ed6-c2ad-4b10-bd59-62a4507076b5","block_type":"box","text":"commitments are forward agreements for the purchase or sale of securities, including mortgage","page_number":157,"box":{"x":116,"y":711,"width":716,"height":12}},{"id":"0df44bff-2db8-4542-8576-eb1d301a600e","block_type":"box","text":"backed securities for a fixed price, with payment and delivery on an agreed upon future settlement","page_number":157,"box":{"x":117,"y":727,"width":728,"height":12}},{"id":"a5ed8afa-dc50-43c0-9112-230b412a9467","block_type":"box","text":"date. The specific securities to be delivered are not identified at the trade date. However, delivered","page_number":157,"box":{"x":116,"y":742,"width":731,"height":12}},{"id":"1c12d6ce-1cbc-4bf2-ad5f-fce21e077079","block_type":"box","text":"securities must meet specified terms, including issuer, rate and mortgage terms. When the Fund enters","page_number":157,"box":{"x":116,"y":758,"width":767,"height":12}},{"id":"f2673e2b-bc81-426f-9ba6-7dd41f1b69cc","block_type":"box","text":"into a TBA commitment for the sale of mortgage-backed securities for a fixed price, with payment and","page_number":157,"box":{"x":117,"y":773,"width":752,"height":12}},{"id":"e7c8b0f5-37b7-4e64-b580-0957d0ca3bd6","block_type":"box","text":"delivery on an agreed upon future settlement date (which may be referred to as having a short position","page_number":157,"box":{"x":116,"y":789,"width":761,"height":12}},{"id":"2a1e1988-c5c0-4639-afa3-833db635335e","block_type":"box","text":"in such TBA securities), the Fund may or may not hold the types of mortgage-backed securities","page_number":157,"box":{"x":117,"y":804,"width":707,"height":12}},{"id":"0bd9d8a2-9c20-4ce8-ae81-040fac432c8c","block_type":"box","text":"required to be delivered. See “—When-Issued Securities, Delayed Delivery Securities and Forward","page_number":157,"box":{"x":117,"y":820,"width":733,"height":12}},{"id":"4c8fe1df-0d7d-498f-a320-474a8a9842ef","block_type":"box","text":"Commitments” below.","page_number":157,"box":{"x":117,"y":835,"width":166,"height":10}},{"id":"81923114-dd06-4c1a-9214-d58d2a5c6db3","block_type":"box","text":"Mortgage Dollar Rolls.","page_number":157,"box":{"x":116,"y":862,"width":164,"height":12}},{"id":"4f1e4029-c0af-492d-8eeb-46d1f48cc0e3","block_type":"box","text":"Certain Funds may invest in mortgage dollar rolls. In a mortgage dollar roll","page_number":157,"box":{"x":282,"y":862,"width":562,"height":12}},{"id":"6ad7d5f5-fb4b-450a-87ee-5c3eca4bbfce","block_type":"box","text":"transaction, a Fund sells mortgage-backed securities for delivery in the current month and","page_number":157,"box":{"x":116,"y":878,"width":673,"height":12}},{"id":"d8be2f26-fc95-44e3-adcf-fe0a428639d6","block_type":"box","text":"II-70","page_number":157,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"0cd6aa14-a11e-4532-b384-3e06e43d4459","block_type":"box","text":"NM1026U-6004382-157/605","page_number":157,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"01064233-a2d7-40db-8cdc-a9b5743c5546","block_type":"box","text":"simultaneously contracts to repurchase substantially similar securities on a specified future date. The","page_number":158,"box":{"x":116,"y":87,"width":755,"height":12}},{"id":"c82ea8f1-3950-4f87-8a8e-8d7e0130db8a","block_type":"box","text":"securities that are repurchased will bear the same interest rate and a similar maturity as those sold, but","page_number":158,"box":{"x":116,"y":103,"width":771,"height":12}},{"id":"ed25d4e6-5511-4733-9f1e-eedd680b9089","block_type":"box","text":"pools of mortgages collateralizing those securities may have different prepayment histories than those","page_number":158,"box":{"x":117,"y":118,"width":762,"height":12}},{"id":"cc09fa61-bb8f-4270-94a3-db6b7f0f3117","block_type":"box","text":"sold. During the period between the sale and repurchase, a Fund will not be entitled to receive interest","page_number":158,"box":{"x":116,"y":134,"width":765,"height":12}},{"id":"4b81116c-31d2-416f-8146-48c10ece70de","block_type":"box","text":"and principal payments on the securities sold. Proceeds of the sale will be invested in additional","page_number":158,"box":{"x":116,"y":149,"width":716,"height":12}},{"id":"a5b2d3f0-daea-4d8a-8a76-1a970db1df88","block_type":"box","text":"instruments for the Fund, and the income from these investments will generate income for the Fund. If","page_number":158,"box":{"x":117,"y":165,"width":762,"height":12}},{"id":"c7fc390c-2ebd-43cf-9950-50f2fd1078db","block_type":"box","text":"such income does not exceed the income, capital appreciation and gain or loss that would have been","page_number":158,"box":{"x":116,"y":180,"width":757,"height":12}},{"id":"0699260e-f621-46f6-b815-35ee3de56adb","block_type":"box","text":"realized on the securities sold as part of the dollar roll, the use of this technique will diminish the","page_number":158,"box":{"x":117,"y":196,"width":715,"height":11}},{"id":"ad8599e8-695e-4a3c-8fb0-1ba936181b27","block_type":"box","text":"investment performance of a Fund compared with what the performance would have been without the","page_number":158,"box":{"x":117,"y":211,"width":759,"height":12}},{"id":"e84e8a02-b8f5-4230-9634-ec5c4ac2bd0b","block_type":"box","text":"use of dollar rolls.","page_number":158,"box":{"x":117,"y":227,"width":135,"height":9}},{"id":"0cf24014-9941-4447-bc43-83f27bfc52b7","block_type":"box","text":"Each mortgage dollar roll transaction is accounted for as a sale or purchase of a portfolio security and","page_number":158,"box":{"x":117,"y":255,"width":760,"height":12}},{"id":"1a125a72-c100-488e-92c9-43aa04e983e8","block_type":"box","text":"a subsequent purchase or sale of a substantially similar security in the forward market. Transactions in","page_number":158,"box":{"x":116,"y":270,"width":767,"height":12}},{"id":"1b55a77e-3fe4-4922-8736-76aa22ab43ac","block_type":"box","text":"mortgage dollar rolls may increase trading costs and portfolio turnover.","page_number":158,"box":{"x":117,"y":286,"width":529,"height":12}},{"id":"91ffcd4d-ad6f-4544-8901-0c43dded7b00","block_type":"box","text":"In the event the buyer of the securities under a mortgage dollar roll files for bankruptcy or becomes","page_number":158,"box":{"x":117,"y":314,"width":738,"height":12}},{"id":"8258f8d1-0445-47f9-a8c5-836e9b2d2442","block_type":"box","text":"insolvent, a Fund’s use of the proceeds of the current sale portion of the transaction may be restricted","page_number":158,"box":{"x":117,"y":330,"width":760,"height":12}},{"id":"03eb5a81-0aae-48cf-b6e5-6b047f943f23","block_type":"box","text":"pending a determination by the other party, or its trustee or receiver, whether to enforce the Fund’s","page_number":158,"box":{"x":117,"y":345,"width":738,"height":12}},{"id":"ce64950b-8077-4d95-9014-f275359978ef","block_type":"box","text":"obligation to purchase the similar securities in the forward transaction.","page_number":158,"box":{"x":116,"y":361,"width":525,"height":12}},{"id":"c8ed8398-8041-4ee6-907c-d4af0ca9ce42","block_type":"box","text":"A Fund may engage in dollar roll transactions to enhance returns. Successful use of mortgage dollar","page_number":158,"box":{"x":116,"y":389,"width":750,"height":12}},{"id":"60741577-d3d8-47f4-b77e-59e157d866bc","block_type":"box","text":"rolls may depend upon the Manager’s ability to correctly predict interest rates and prepayments. Dollar","page_number":158,"box":{"x":117,"y":405,"width":765,"height":12}},{"id":"04b46fc6-359e-4797-af1b-b0e018cc3384","block_type":"box","text":"rolls involve the risk that the market value of the securities subject to a Fund’s forward purchase","page_number":158,"box":{"x":117,"y":420,"width":716,"height":12}},{"id":"00d23638-bd09-4f70-b9d1-5caaceeffcf0","block_type":"box","text":"commitment may decline below, or the market value of the securities subject to a Fund’s forward sale","page_number":158,"box":{"x":116,"y":436,"width":758,"height":12}},{"id":"2badd5da-807d-4ed6-8288-0a288797dc59","block_type":"box","text":"commitment may increase above, the exercise price of the forward commitment. Dollar rolls are","page_number":158,"box":{"x":116,"y":451,"width":715,"height":12}},{"id":"ef7eb534-b11e-43d5-a131-c3d7b54be8f7","block_type":"box","text":"speculative techniques that can be deemed to involve leverage. There is no assurance that dollar rolls","page_number":158,"box":{"x":116,"y":467,"width":763,"height":12}},{"id":"cf8aa1ec-ce5a-4374-b930-c61a1ede9d09","block_type":"box","text":"can be successfully employed.","page_number":158,"box":{"x":116,"y":482,"width":233,"height":12}},{"id":"484ff479-3818-4067-8c8e-bf1b682cd85a","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into when-issued or forward","page_number":158,"box":{"x":117,"y":511,"width":740,"height":12}},{"id":"381ef748-55cc-4824-8f6e-0e50a8a87761","block_type":"box","text":"settling securities (e.g., dollar rolls and firm and standby commitments, including TBA commitments)","page_number":158,"box":{"x":116,"y":526,"width":748,"height":12}},{"id":"9c8f0c0f-aa53-450f-a21b-75b8367e1d28","block_type":"box","text":"and non-standard settlement cycle securities notwithstanding the limitation on the issuance of senior","page_number":158,"box":{"x":116,"y":542,"width":750,"height":12}},{"id":"72f68804-873a-48ae-93bc-34dafba6750c","block_type":"box","text":"securities in Section 18 of the Investment Company Act, provided that the transaction meets the","page_number":158,"box":{"x":116,"y":557,"width":718,"height":12}},{"id":"f1e365fd-a9e0-4d7b-810f-04a27eef5763","block_type":"box","text":"Delayed-Settlement Securities Provision (as defined below under “—When-Issued Securities, Delayed","page_number":158,"box":{"x":117,"y":573,"width":764,"height":12}},{"id":"514c5db2-cac7-4152-932e-748a04cf9fd7","block_type":"box","text":"Delivery Securities and Forward Commitments”). If a when-issued, forward-settling or non-standard","page_number":158,"box":{"x":117,"y":588,"width":742,"height":12}},{"id":"8597f8c4-51fa-436c-9acc-b454ed1f9d64","block_type":"box","text":"settlement cycle security does not satisfy the Delayed-Settlement Securities Provision, then it is","page_number":158,"box":{"x":116,"y":604,"width":715,"height":12}},{"id":"3703c3c6-2c8b-4aac-aab2-0b42943db5e7","block_type":"box","text":"treated as a Derivatives Transaction under Rule 18f-4. See “—Derivatives—Regulation of","page_number":158,"box":{"x":116,"y":619,"width":669,"height":12}},{"id":"5d1368bd-e05a-4e7f-8670-4862a621a652","block_type":"box","text":"Derivatives—Rule 18f-4 under the Investment Company Act” above.","page_number":158,"box":{"x":117,"y":635,"width":511,"height":12}},{"id":"ae049767-4ac5-41ba-a832-9b01ade11225","block_type":"box","text":"Net Interest Margin (NIM) Securities.","page_number":158,"box":{"x":117,"y":663,"width":270,"height":12}},{"id":"b65a6607-9c8b-4ac5-b670-e4d47e17c43d","block_type":"box","text":"A Fund may invest in net interest margin (“NIM”) securities.","page_number":158,"box":{"x":394,"y":663,"width":438,"height":12}},{"id":"51341023-3050-4151-bedd-d951592d8fdf","block_type":"box","text":"These securities are derivative interest-only mortgage securities structured off home equity loan","page_number":158,"box":{"x":116,"y":678,"width":711,"height":13}},{"id":"a09d1f83-d9ff-43b7-a572-fba386e39014","block_type":"box","text":"transactions. NIM securities receive any “excess” interest computed after paying coupon costs,","page_number":158,"box":{"x":116,"y":694,"width":704,"height":12}},{"id":"5ab90421-00a0-415a-9281-c9f529f8e47a","block_type":"box","text":"servicing costs and fees and any credit losses associated with the underlying pool of home equity","page_number":158,"box":{"x":116,"y":709,"width":724,"height":13}},{"id":"63f2cf5e-c639-4c95-acd5-b6433e2dfce6","block_type":"box","text":"loans. Like traditional stripped mortgage-backed securities, the yield to maturity on a NIM security is","page_number":158,"box":{"x":117,"y":725,"width":740,"height":12}},{"id":"57e99bb0-9602-462c-9d7b-994f6fcdfd56","block_type":"box","text":"sensitive not only to changes in prevailing interest rates but also to the rate of principal payments","page_number":158,"box":{"x":116,"y":740,"width":720,"height":13}},{"id":"6ebc9943-6ce1-4ef8-9c9a-9ab62e7021e6","block_type":"box","text":"(including prepayments) on the underlying home equity loans. NIM securities are highly sensitive to","page_number":158,"box":{"x":117,"y":756,"width":735,"height":12}},{"id":"ba621e1d-3be7-4b20-9482-a12fd3020e86","block_type":"box","text":"credit losses on the underlying collateral and the timing in which those losses are taken.","page_number":158,"box":{"x":116,"y":772,"width":651,"height":12}},{"id":"a77e019f-9681-4ea9-8b93-bc69a6315570","block_type":"box","text":"Municipal Investments.","page_number":158,"box":{"x":116,"y":800,"width":184,"height":12}},{"id":"5607426f-d372-4059-b198-267295cb7b99","block_type":"box","text":"Certain Funds may invest in obligations issued by or on behalf of states,","page_number":158,"box":{"x":307,"y":800,"width":533,"height":12}},{"id":"aa2de9db-f0bc-48d2-9522-f95341ec3cc3","block_type":"box","text":"territories and possessions of the United States and the District of Columbia and their political","page_number":158,"box":{"x":116,"y":815,"width":694,"height":12}},{"id":"bd38b647-0d6e-4a9d-8d6c-3f2895aa5121","block_type":"box","text":"subdivisions, agencies and instrumentalities, the payments from which, in the opinion of bond counsel","page_number":158,"box":{"x":116,"y":831,"width":761,"height":12}},{"id":"75f59ddb-83ff-4329-b70f-8d7db57ed210","block_type":"box","text":"to the issuer, are excludable from gross income for U.S. federal income tax purposes (“Municipal","page_number":158,"box":{"x":116,"y":846,"width":723,"height":12}},{"id":"79bb46c8-88e2-4528-9c25-825d9a5fa532","block_type":"box","text":"Bonds”). Certain of the Municipal Funds may also invest in Municipal Bonds that pay interest","page_number":158,"box":{"x":117,"y":862,"width":691,"height":12}},{"id":"3f708988-6d7e-4bc4-84a3-325e7e58a3c9","block_type":"box","text":"excludable from gross income for purposes of state and local income taxes of the designated state","page_number":158,"box":{"x":116,"y":877,"width":737,"height":12}},{"id":"beb2a324-bd10-4ae6-804f-f94977fd544f","block_type":"box","text":"II-71","page_number":158,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"9becbcdf-0a65-4af3-9ff4-ef92caae9d7f","block_type":"box","text":"NM1026U-6004382-158/605","page_number":158,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ef069de2-a0cc-41ee-9497-3b6524e6c92e","block_type":"box","text":"and/or allow the value of a Fund’s shares to be exempt from state and local taxes of the designated","page_number":159,"box":{"x":116,"y":87,"width":744,"height":12}},{"id":"db4f288a-f03e-4278-8aaf-84cd9a9edead","block_type":"box","text":"state (“State Municipal Bonds”). The Municipal Funds may also invest in securities not issued by or on","page_number":159,"box":{"x":116,"y":102,"width":762,"height":13}},{"id":"8ae4ec68-81cd-42d8-b810-830f1bcf5029","block_type":"box","text":"behalf of a state or territory or by an agency or instrumentality thereof, if the Manager believes such","page_number":159,"box":{"x":117,"y":118,"width":743,"height":12}},{"id":"4651c7ac-2623-42ba-a5bd-9859ebb62f5b","block_type":"box","text":"securities to pay interest excludable from gross income for purposes of U.S. federal income tax and","page_number":159,"box":{"x":116,"y":134,"width":744,"height":12}},{"id":"af4aaf55-a90a-4251-a608-87ec5e174572","block_type":"box","text":"state and local income taxes of the designated state and/or state and local personal property taxes of","page_number":159,"box":{"x":116,"y":149,"width":757,"height":12}},{"id":"66b79bb0-1493-4d69-9201-114f931da511","block_type":"box","text":"the designated state (“Non-Municipal Tax-Exempt Securities”). Non-Municipal Tax-Exempt Securities","page_number":159,"box":{"x":116,"y":165,"width":756,"height":12}},{"id":"f3f79624-7d2b-4164-88cb-571d8c4d195e","block_type":"box","text":"could include trust certificates or other instruments evidencing interest in one or more long-term","page_number":159,"box":{"x":116,"y":180,"width":714,"height":12}},{"id":"865cc710-495f-4ef0-9554-ec8c50a23e20","block_type":"box","text":"municipal securities. Non-Municipal Tax-Exempt Securities also may include securities issued by other","page_number":159,"box":{"x":117,"y":196,"width":765,"height":12}},{"id":"2e59bd3b-a0ae-4214-b442-f31189af3235","block_type":"box","text":"investment companies that invest in municipal bonds, to the extent such investments are permitted by","page_number":159,"box":{"x":117,"y":211,"width":760,"height":12}},{"id":"e641ed14-96ed-441e-bd9c-85a405a1d5f2","block_type":"box","text":"applicable law. Non-Municipal Tax-Exempt Securities that pay interest excludable from gross income","page_number":159,"box":{"x":116,"y":227,"width":754,"height":12}},{"id":"bcff9ea5-8a8a-4048-8910-db4b7bf35f3b","block_type":"box","text":"for U.S. federal income tax purposes will be considered “Municipal Bonds” for purposes of a Municipal","page_number":159,"box":{"x":116,"y":242,"width":762,"height":12}},{"id":"db85114c-46fd-4c01-99d7-8163c06e67c8","block_type":"box","text":"Fund’s investment objective and policies. Non-Municipal Tax-Exempt Securities that pay interest","page_number":159,"box":{"x":117,"y":258,"width":720,"height":12}},{"id":"779d91b4-88dc-4bce-9047-006796dd8152","block_type":"box","text":"excludable from gross income for purposes of U.S. federal income tax and state and local income","page_number":159,"box":{"x":116,"y":273,"width":730,"height":12}},{"id":"393ca028-f503-4dbd-8272-2167587bf713","block_type":"box","text":"taxes of a designated state and/or allow the value of a Fund’s shares to be exempt from state and local","page_number":159,"box":{"x":116,"y":289,"width":771,"height":12}},{"id":"6341df33-f5cc-446f-88fb-d25d820a0fa7","block_type":"box","text":"personal property taxes of that state will be considered “State Municipal Bonds” for purposes of the","page_number":159,"box":{"x":117,"y":304,"width":739,"height":12}},{"id":"145cd4f4-cddf-4dfa-8c19-12e5f240cb74","block_type":"box","text":"investment objective and policies of each of California Municipal Opportunities Fund, New Jersey","page_number":159,"box":{"x":117,"y":320,"width":724,"height":12}},{"id":"8f9082ef-d860-4b30-ad23-55a133b44e3a","block_type":"box","text":"Municipal Bond Fund, New York Municipal Opportunities Fund and Pennsylvania Municipal Bond","page_number":159,"box":{"x":117,"y":335,"width":724,"height":12}},{"id":"e76771c6-1da9-4903-81ac-f57e403a8551","block_type":"box","text":"Fund.","page_number":159,"box":{"x":117,"y":351,"width":46,"height":9}},{"id":"0bf8b6a5-9620-45a3-81c2-43d9afa712dd","block_type":"box","text":"Risk Factors and Special Considerations Relating to Municipal Bonds.","page_number":159,"box":{"x":116,"y":380,"width":519,"height":12}},{"id":"54d71d28-0094-41af-a388-55d2259c7591","block_type":"box","text":"The risks and special","page_number":159,"box":{"x":636,"y":380,"width":168,"height":12}},{"id":"c2652449-0f6b-49ab-941a-d2af16aa6de6","block_type":"box","text":"considerations involved in investment in Municipal Bonds vary with the types of instruments being","page_number":159,"box":{"x":116,"y":395,"width":729,"height":12}},{"id":"02562f5e-19b7-41f0-a2df-75a874a8ffcd","block_type":"box","text":"acquired. Investments in Non-Municipal Tax-Exempt Securities may present similar risks, depending","page_number":159,"box":{"x":116,"y":411,"width":751,"height":12}},{"id":"803902c1-f482-4ad0-bd43-b4dc58389b75","block_type":"box","text":"on the particular product. Certain municipal instruments in which a Fund may invest may be","page_number":159,"box":{"x":116,"y":426,"width":685,"height":12}},{"id":"6b6206d0-15b0-41ae-adc9-9a549282b2ab","block_type":"box","text":"characterized as derivatives.","page_number":159,"box":{"x":116,"y":442,"width":218,"height":9}},{"id":"ed21b774-5126-4389-ac5c-718ce6bd85fe","block_type":"box","text":"The value of Municipal Bonds generally may be affected by uncertainties in the municipal markets as a","page_number":159,"box":{"x":116,"y":471,"width":768,"height":12}},{"id":"564d1b6a-a2fe-4c92-b2b5-9856f29218ad","block_type":"box","text":"result of legislation or litigation, including legislation or litigation that changes the taxation of Municipal","page_number":159,"box":{"x":117,"y":487,"width":757,"height":12}},{"id":"394c9bd6-9fae-4ae0-a6e8-16d217c3571c","block_type":"box","text":"Bonds or the rights of Municipal Bond holders in the event of a bankruptcy. Municipal bankruptcies are","page_number":159,"box":{"x":117,"y":502,"width":764,"height":12}},{"id":"d968f5f3-601a-41da-8ca4-99bf4e340059","block_type":"box","text":"rare and certain provisions of the U.S. Bankruptcy Code governing such bankruptcies are unclear.","page_number":159,"box":{"x":117,"y":518,"width":732,"height":12}},{"id":"d5da28db-3475-4ed9-8aa3-047a98325fe7","block_type":"box","text":"Further, the application of state law to Municipal Bond issuers could produce varying results among the","page_number":159,"box":{"x":117,"y":533,"width":770,"height":12}},{"id":"0aba5d8b-b032-4dd2-a4f9-6f319010f5aa","block_type":"box","text":"states or among Municipal Bond issuers within a state. These uncertainties could have a significant","page_number":159,"box":{"x":116,"y":549,"width":742,"height":12}},{"id":"745ae503-bd58-40aa-94dd-9749b04a639e","block_type":"box","text":"impact on the prices of the Municipal Bonds in which a Fund invests.","page_number":159,"box":{"x":117,"y":564,"width":513,"height":12}},{"id":"0c1bc9c8-8db6-4c82-abdb-531109d9d79c","block_type":"box","text":"Description of Municipal Bonds.","page_number":159,"box":{"x":116,"y":593,"width":240,"height":12}},{"id":"60a33c9c-c380-42fa-811e-035bb517e056","block_type":"box","text":"Municipal Bonds include debt obligations issued to obtain funds for various public purposes, including","page_number":159,"box":{"x":117,"y":616,"width":757,"height":12}},{"id":"f2487f5a-b22a-4177-81c5-17deba2555da","block_type":"box","text":"the construction of a wide range of public facilities, refunding of outstanding obligations and obtaining","page_number":159,"box":{"x":116,"y":631,"width":756,"height":12}},{"id":"3920973a-f778-41c1-bc02-69a4d3317da6","block_type":"box","text":"funds for general operating expenses and loans to other public institutions and facilities. In addition,","page_number":159,"box":{"x":116,"y":647,"width":744,"height":12}},{"id":"60cacfcd-1640-4e55-a29f-0424af53c496","block_type":"box","text":"certain types of bonds are issued by or on behalf of public authorities to finance various privately","page_number":159,"box":{"x":116,"y":662,"width":716,"height":12}},{"id":"48197521-26d8-4fac-a212-584eef28171e","block_type":"box","text":"owned or operated facilities, including certain facilities for the local furnishing of electric energy or gas,","page_number":159,"box":{"x":116,"y":678,"width":757,"height":12}},{"id":"186e7218-7eb0-48a6-b3c9-7c3b6f339fd0","block_type":"box","text":"sewage facilities, solid waste disposal facilities and other specialized facilities. Such obligations are","page_number":159,"box":{"x":116,"y":693,"width":735,"height":12}},{"id":"4d5071f3-d348-43f1-8b12-a47f922b36bf","block_type":"box","text":"included within the term Municipal Bonds if the interest paid thereon is excluded from gross income for","page_number":159,"box":{"x":117,"y":709,"width":760,"height":12}},{"id":"d633ce00-ccbc-444c-a7e7-0a205d0bb76d","block_type":"box","text":"U.S. federal income tax purposes and any applicable state and local taxes. Other types of private","page_number":159,"box":{"x":117,"y":724,"width":721,"height":12}},{"id":"52027e42-e0ef-4908-bdd3-4270e6d6fc22","block_type":"box","text":"activity bonds, the proceeds of which are used for the construction, equipment or improvement of","page_number":159,"box":{"x":116,"y":740,"width":722,"height":12}},{"id":"e423e9c7-c8e1-47ce-ac73-8f36efd731ee","block_type":"box","text":"privately operated industrial or commercial facilities, may constitute Municipal Bonds, although the","page_number":159,"box":{"x":117,"y":755,"width":727,"height":12}},{"id":"73822887-cfcd-4a8e-9d52-630725d272a6","block_type":"box","text":"current U.S. federal tax laws place substantial limitations on the size of such issues. The interest on","page_number":159,"box":{"x":116,"y":771,"width":739,"height":12}},{"id":"b09e30b2-6639-4cdb-8f91-34674e5ecf0b","block_type":"box","text":"Municipal Bonds may bear a fixed rate or be payable at a variable or floating rate. The two principal","page_number":159,"box":{"x":117,"y":786,"width":736,"height":12}},{"id":"87cc43ff-e491-4fba-9a84-179417444459","block_type":"box","text":"classifications of Municipal Bonds are “general obligation” and “revenue” or “special obligation” bonds,","page_number":159,"box":{"x":116,"y":802,"width":756,"height":12}},{"id":"581db2ec-9955-480b-b9d9-8fe0e4c4e3b3","block_type":"box","text":"which latter category includes private activity bonds (“PABs”) (or “industrial development bonds” under","page_number":159,"box":{"x":116,"y":817,"width":760,"height":12}},{"id":"6b552137-0b96-4524-a101-50766a9db7c9","block_type":"box","text":"pre-1986 law).","page_number":159,"box":{"x":117,"y":833,"width":111,"height":12}},{"id":"812c9e29-594d-43e9-aa7c-81a8c9213522","block_type":"box","text":"General Obligation Bonds.","page_number":159,"box":{"x":117,"y":862,"width":194,"height":12}},{"id":"76fff04b-fc4f-43a7-be9a-a450bb09531f","block_type":"box","text":"General obligation bonds are secured by the issuer’s pledge of its full faith,","page_number":159,"box":{"x":313,"y":862,"width":565,"height":12}},{"id":"b1b270eb-9515-448c-b9d4-bd2e3fc308c1","block_type":"box","text":"credit and taxing power for the payment of principal and interest. The taxing power of any","page_number":159,"box":{"x":116,"y":878,"width":668,"height":12}},{"id":"99c10aa1-e6f3-4a1f-9b6c-622505fc83fa","block_type":"box","text":"II-72","page_number":159,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"a8b1d7b8-1857-4142-ae6e-248327f6aeb3","block_type":"box","text":"NM1026U-6004382-159/605","page_number":159,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"681e8ca0-2dc1-46bb-be21-757b6cc5015e","block_type":"box","text":"governmental entity may be limited, however, by provisions of its state constitution or laws, and an","page_number":160,"box":{"x":116,"y":87,"width":735,"height":12}},{"id":"bf09d860-310a-4d45-8a83-3a21bae0eec3","block_type":"box","text":"entity’s creditworthiness will depend on many factors, including potential erosion of its tax base due to","page_number":160,"box":{"x":116,"y":102,"width":760,"height":13}},{"id":"989e3bd7-6ae8-4f9f-be43-673a9d673325","block_type":"box","text":"population declines, natural disasters, declines in the state’s industrial base or inability to attract new","page_number":160,"box":{"x":117,"y":118,"width":750,"height":12}},{"id":"33e46381-2e77-487d-be4c-265e88cb9024","block_type":"box","text":"industries, economic limits on the ability to tax without eroding the tax base, state legislative proposals","page_number":160,"box":{"x":117,"y":134,"width":762,"height":12}},{"id":"a8663a86-f91b-4f22-9d04-f0cc88cb81a3","block_type":"box","text":"or voter initiatives to limit ad valorem real property taxes and the extent to which the entity relies on","page_number":160,"box":{"x":116,"y":149,"width":740,"height":12}},{"id":"71b0478e-791a-4a58-af84-05885130fd17","block_type":"box","text":"federal or state aid, access to capital markets or other factors beyond the state’s or entity’s control.","page_number":160,"box":{"x":116,"y":165,"width":738,"height":12}},{"id":"4d426fea-e1f7-46a6-a09d-d9061dca2597","block_type":"box","text":"Accordingly, the capacity of the issuer of a general obligation bond as to the timely payment of interest","page_number":160,"box":{"x":116,"y":180,"width":765,"height":12}},{"id":"83c6c857-5807-46ca-8a05-1307da6babc8","block_type":"box","text":"and the repayment of principal when due is affected by the issuer’s maintenance of its tax base.","page_number":160,"box":{"x":116,"y":196,"width":717,"height":12}},{"id":"a5a3fc6e-a553-4e74-af22-df3e1275ba31","block_type":"box","text":"Revenue Bonds.","page_number":160,"box":{"x":116,"y":227,"width":122,"height":9}},{"id":"4594f432-1e67-4b05-8f21-ebc8f026825c","block_type":"box","text":"Revenue bonds are payable only from the revenues derived from a particular facility","page_number":160,"box":{"x":240,"y":227,"width":634,"height":12}},{"id":"be37080a-a469-4367-b8ba-1a5ee5a32b3b","block_type":"box","text":"or class of facilities or, in some cases, from the proceeds of a special excise tax or other specific","page_number":160,"box":{"x":116,"y":242,"width":720,"height":12}},{"id":"73956496-a528-492b-af58-87e532c65651","block_type":"box","text":"revenue source such as payments from the user of the facility being financed; accordingly, the timely","page_number":160,"box":{"x":117,"y":258,"width":752,"height":12}},{"id":"e355ea55-37cc-4210-8766-2b8b1694c4ef","block_type":"box","text":"payment of interest and the repayment of principal in accordance with the terms of the revenue or","page_number":160,"box":{"x":117,"y":273,"width":729,"height":12}},{"id":"bbc93e6d-61d1-4566-845c-8d63dbeed08d","block_type":"box","text":"special obligation bond is a function of the economic viability of such facility or such revenue source.","page_number":160,"box":{"x":116,"y":289,"width":749,"height":12}},{"id":"3b775ebf-b2e2-4e45-afd5-d7526396ee93","block_type":"box","text":"Revenue bonds issued by state or local agencies to finance the development of low-income, multi","page_number":160,"box":{"x":117,"y":320,"width":730,"height":12}},{"id":"2c459e32-ac27-4637-9813-e7d6d06da562","block_type":"box","text":"family housing involve special risks in addition to those associated with municipal bonds generally,","page_number":160,"box":{"x":116,"y":335,"width":735,"height":12}},{"id":"5b0aa42b-c12d-4cc9-9139-8b38cb0e274c","block_type":"box","text":"including that the underlying properties may not generate sufficient income to pay expenses and","page_number":160,"box":{"x":117,"y":351,"width":718,"height":12}},{"id":"90d69c6c-d337-4b52-8e79-0f180d8f3d36","block_type":"box","text":"interest costs. Such bonds are generally non-recourse against the property owner, may be junior to the","page_number":160,"box":{"x":117,"y":366,"width":768,"height":12}},{"id":"00606e08-0b8a-49e0-b588-a012308a7408","block_type":"box","text":"rights of others with an interest in the properties, may pay interest that changes based in part on the","page_number":160,"box":{"x":117,"y":382,"width":746,"height":12}},{"id":"51b44df0-27d2-478b-b96b-df5419b0d308","block_type":"box","text":"financial performance of the property, may be prepayable without penalty and may be used to finance","page_number":160,"box":{"x":116,"y":397,"width":760,"height":12}},{"id":"7a65f805-3a53-493d-a314-c6b9f23cc862","block_type":"box","text":"the construction of housing developments which, until completed and rented, do not generate income","page_number":160,"box":{"x":116,"y":413,"width":757,"height":12}},{"id":"1a37aee1-a14a-422c-895b-e2a3597673af","block_type":"box","text":"to pay interest. Increases in interest rates payable on senior obligations may make it more difficult for","page_number":160,"box":{"x":116,"y":428,"width":755,"height":12}},{"id":"d9b985cd-3d32-45ff-9832-a098f53bc487","block_type":"box","text":"issuers to meet payment obligations on subordinated bonds.","page_number":160,"box":{"x":117,"y":444,"width":452,"height":12}},{"id":"3801a926-6828-4c33-8007-54d7311d0362","block_type":"box","text":"PABs.","page_number":160,"box":{"x":116,"y":475,"width":45,"height":9}},{"id":"e976d4ca-61cc-4e0b-a130-9f5b9f1a30da","block_type":"box","text":"PABs are, in most cases, tax-exempt securities issued by states, municipalities or public","page_number":160,"box":{"x":162,"y":475,"width":666,"height":12}},{"id":"955e6d92-3a7c-4603-8177-6d0328e8699c","block_type":"box","text":"authorities to provide funds, usually through a loan or lease arrangement, to a private entity for the","page_number":160,"box":{"x":116,"y":490,"width":735,"height":12}},{"id":"56684143-3cc4-49b6-ab06-5ee118f531a7","block_type":"box","text":"purpose of financing construction or improvement of a facility to be used by the entity. Such bonds are","page_number":160,"box":{"x":117,"y":506,"width":762,"height":12}},{"id":"475119da-1dfc-4d34-acde-fc60cca0e868","block_type":"box","text":"secured primarily by revenues derived from loan repayments or lease payments due from the entity,","page_number":160,"box":{"x":116,"y":521,"width":747,"height":12}},{"id":"ba046539-737d-4f22-9bf6-24bbad500d95","block_type":"box","text":"which may or may not be guaranteed by a parent company or otherwise secured. PABs generally are","page_number":160,"box":{"x":116,"y":537,"width":758,"height":12}},{"id":"3f01957c-40c8-40db-97b4-54800f628757","block_type":"box","text":"not secured by a pledge of the taxing power of the issuer of such bonds. Therefore, an investor should","page_number":160,"box":{"x":117,"y":552,"width":764,"height":12}},{"id":"39e12ab0-b349-43a6-9fd3-0b28f5752180","block_type":"box","text":"understand that repayment of such bonds generally depends on the revenues of a private entity and be","page_number":160,"box":{"x":117,"y":568,"width":771,"height":12}},{"id":"f745113b-755e-4fb4-af5f-afcb989094f5","block_type":"box","text":"aware of the risks that such an investment may entail. The continued ability of an entity to generate","page_number":160,"box":{"x":116,"y":583,"width":741,"height":12}},{"id":"23d2921d-5369-444e-923c-c617b4ce7069","block_type":"box","text":"sufficient revenues for the payment of principal and interest on such bonds will be affected by many","page_number":160,"box":{"x":116,"y":599,"width":744,"height":12}},{"id":"51bfbc78-c181-4b8a-8955-acb33fa2956e","block_type":"box","text":"factors including the size of the entity, its capital structure, demand for its products or services,","page_number":160,"box":{"x":116,"y":614,"width":707,"height":12}},{"id":"540a866b-6be3-453b-b104-3743ae803af3","block_type":"box","text":"competition, general economic conditions, government regulation and the entity’s dependence on","page_number":160,"box":{"x":116,"y":630,"width":728,"height":12}},{"id":"2b0dfecd-5b64-4988-b353-299218e05aeb","block_type":"box","text":"revenues for the operation of the particular facility being financed.","page_number":160,"box":{"x":117,"y":645,"width":491,"height":12}},{"id":"c10ce478-d3c3-45e1-9b2a-d9bc39ecc2e0","block_type":"box","text":"Moral Obligation Bonds.","page_number":160,"box":{"x":116,"y":676,"width":178,"height":12}},{"id":"ece6f980-2dc0-4ebe-881c-1d8cab559ab3","block_type":"box","text":"“Moral obligation” bonds are normally issued by special purpose public","page_number":160,"box":{"x":301,"y":676,"width":523,"height":12}},{"id":"e8527323-e13c-47a6-b622-cfc6006cbae8","block_type":"box","text":"authorities. If an issuer of moral obligation bonds is unable to meet its obligations, the repayment of","page_number":160,"box":{"x":116,"y":692,"width":738,"height":12}},{"id":"1bc4ddc9-e64e-4564-9983-c4cb85798fe7","block_type":"box","text":"such bonds becomes a moral commitment but not a legal obligation of the state or municipality that","page_number":160,"box":{"x":116,"y":707,"width":736,"height":12}},{"id":"96cc787b-ac97-4cce-b30d-99a86a36cd29","block_type":"box","text":"created the special purpose public authority that issued the bonds.","page_number":160,"box":{"x":116,"y":723,"width":492,"height":12}},{"id":"1063c4d9-4661-4ec2-9a26-0126f7b14b11","block_type":"box","text":"Municipal Notes.","page_number":160,"box":{"x":116,"y":754,"width":122,"height":12}},{"id":"8228c3f3-fa80-4196-9c32-22ac89dc14b3","block_type":"box","text":"Municipal notes are shorter term municipal debt obligations. They may provide interim","page_number":160,"box":{"x":246,"y":754,"width":636,"height":12}},{"id":"8f8286df-479a-4395-9ec5-e9bbd1007c32","block_type":"box","text":"financing in anticipation of tax collection, bond sales or revenue receipts. If there is a shortfall in the","page_number":160,"box":{"x":116,"y":769,"width":737,"height":12}},{"id":"fb011962-8ea6-4ea7-b52b-098c5658b2ff","block_type":"box","text":"anticipated proceeds, repayment on the note may be delayed or the note may not be fully repaid, and a","page_number":160,"box":{"x":116,"y":785,"width":766,"height":12}},{"id":"2b9c0c33-46c2-4832-979d-ce3a1ef0b84a","block_type":"box","text":"Fund may lose money.","page_number":160,"box":{"x":117,"y":800,"width":167,"height":12}},{"id":"26ae8e02-09e1-40d9-8ef2-a2414df9635a","block_type":"box","text":"Municipal Commercial Paper.","page_number":160,"box":{"x":116,"y":831,"width":218,"height":12}},{"id":"c7e8612a-fbc2-423c-bdf5-1a632c6fe91e","block_type":"box","text":"Municipal commercial paper is generally unsecured and issued to meet","page_number":160,"box":{"x":335,"y":831,"width":539,"height":12}},{"id":"ed91c00d-f3a7-4dec-aaad-408d085d361e","block_type":"box","text":"short-term financing needs. The lack of security presents some risk of loss to a Fund since, in the","page_number":160,"box":{"x":116,"y":847,"width":728,"height":12}},{"id":"755915e3-0ba2-419e-b85a-2151158e133e","block_type":"box","text":"event of an issuer’s bankruptcy, unsecured creditors are repaid only after the secured creditors out of","page_number":160,"box":{"x":116,"y":862,"width":757,"height":12}},{"id":"dafae29c-01a8-4ad8-b76e-52f04f276383","block_type":"box","text":"the assets, if any, that remain.","page_number":160,"box":{"x":116,"y":878,"width":229,"height":12}},{"id":"b1e88284-f1ad-40c2-af9d-39293f99b151","block_type":"box","text":"II-73","page_number":160,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"1323aa8e-dae9-40ff-88ec-a48977cadcfc","block_type":"box","text":"NM1026U-6004382-160/605","page_number":160,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"09ef5a72-5e56-42b7-be7b-c88ed46acd05","block_type":"box","text":"Municipal Lease Obligations.","page_number":161,"box":{"x":116,"y":87,"width":213,"height":12}},{"id":"e9553551-97c3-484a-b1c7-33db4c902ce1","block_type":"box","text":"Also included within the general category of Municipal Bonds are","page_number":161,"box":{"x":331,"y":87,"width":491,"height":12}},{"id":"67b9dfbb-913a-40cb-95a9-4df9dd809602","block_type":"box","text":"certificates of participation (“COPs”) issued by government authorities or entities to finance the","page_number":161,"box":{"x":116,"y":102,"width":706,"height":13}},{"id":"cde3a56d-6ca4-44b6-b074-1fc3e9637215","block_type":"box","text":"acquisition or construction of equipment, land and/or facilities. The COPs represent participations in a","page_number":161,"box":{"x":116,"y":118,"width":758,"height":12}},{"id":"f235a0dd-1368-4cd0-a33c-4670847132b4","block_type":"box","text":"lease, an installment purchase contract or a conditional sales contract (hereinafter collectively called","page_number":161,"box":{"x":117,"y":134,"width":748,"height":12}},{"id":"fa21820e-7c6c-4c9c-8d47-4f90bb8c9ac4","block_type":"box","text":"“lease obligations”) relating to such equipment, land or facilities. Municipal leases, like other municipal","page_number":161,"box":{"x":116,"y":149,"width":761,"height":12}},{"id":"0d92a423-da29-41a7-bdcb-52d278988bbf","block_type":"box","text":"debt obligations, are subject to the risk of non-payment. Although lease obligations do not constitute","page_number":161,"box":{"x":116,"y":165,"width":747,"height":12}},{"id":"b9b50f6f-9106-4409-be83-c0745b0424e3","block_type":"box","text":"general obligations of the issuer for which the issuer’s unlimited taxing power is pledged, a lease","page_number":161,"box":{"x":116,"y":180,"width":721,"height":12}},{"id":"ee65fccd-f5ba-4eab-b53f-094be2c81cec","block_type":"box","text":"obligation is frequently backed by the issuer’s covenant to budget for, appropriate and make the","page_number":161,"box":{"x":116,"y":196,"width":716,"height":12}},{"id":"5908e61e-d9df-495d-b3d2-b2e51497fa92","block_type":"box","text":"payments due under the lease obligation. However, certain lease obligations contain","page_number":161,"box":{"x":117,"y":211,"width":631,"height":12}},{"id":"70a739c4-e490-4938-917a-cc2d7ec876c0","block_type":"box","text":"“non-appropriation” clauses, which provide that the issuer has no obligation to make lease or","page_number":161,"box":{"x":116,"y":227,"width":693,"height":12}},{"id":"2c3b50da-52fa-43cd-9952-f1884f10f13d","block_type":"box","text":"installment purchase payments in future years unless money is appropriated for such purpose on a","page_number":161,"box":{"x":117,"y":242,"width":739,"height":12}},{"id":"6b717004-2e3f-4f77-a692-7021328282c5","block_type":"box","text":"yearly basis. Although “non-appropriation” lease obligations are secured by the leased property,","page_number":161,"box":{"x":116,"y":258,"width":716,"height":12}},{"id":"9e9ba1e8-0a16-4c46-975e-09d19993db9e","block_type":"box","text":"disposition of the property in the event of foreclosure might prove difficult. These securities represent a","page_number":161,"box":{"x":116,"y":273,"width":767,"height":12}},{"id":"d13ca19a-484c-4be9-9d92-eb8ba38e6876","block_type":"box","text":"type of financing that has not yet developed the depth of marketability associated with more","page_number":161,"box":{"x":116,"y":289,"width":685,"height":12}},{"id":"4c7f7480-d581-4f89-b340-a70e86ac0b3c","block_type":"box","text":"conventional securities. Certain investments in lease obligations may be illiquid.","page_number":161,"box":{"x":116,"y":304,"width":596,"height":12}},{"id":"97ad4cc2-906e-4544-a098-425af618bd0f","block_type":"box","text":"The ability of issuers of municipal leases to make timely lease payments may be adversely impacted in","page_number":161,"box":{"x":116,"y":335,"width":769,"height":12}},{"id":"666de831-d472-4089-9d65-849290cf0c74","block_type":"box","text":"general economic downturns and as relative governmental cost burdens are allocated and reallocated","page_number":161,"box":{"x":116,"y":351,"width":762,"height":12}},{"id":"7ed8185f-1aa4-4a8c-b1fe-71adb1207387","block_type":"box","text":"among federal, state and local governmental units. Such non-payment would result in a reduction of","page_number":161,"box":{"x":116,"y":366,"width":746,"height":12}},{"id":"764c181d-7560-4840-ba0d-a63605f2a3b0","block_type":"box","text":"income to a Fund and could result in a","page_number":161,"box":{"x":117,"y":382,"width":289,"height":9}},{"id":"d7b07e56-8cdd-4c7e-a24a-394906d0aa1d","block_type":"box","text":"reduction in the value of the municipal lease experiencing","page_number":161,"box":{"x":407,"y":382,"width":431,"height":12}},{"id":"bd334f81-a2ba-49d9-9d2b-54c37ba1b1f1","block_type":"box","text":"non-payment and a potential decrease in the NAV of a Fund. Issuers of municipal securities might","page_number":161,"box":{"x":117,"y":397,"width":731,"height":12}},{"id":"864abeea-a0da-4901-96f0-ed5a93c38b07","block_type":"box","text":"seek protection under the bankruptcy laws. In the event of bankruptcy of such an issuer, a Fund could","page_number":161,"box":{"x":116,"y":413,"width":762,"height":12}},{"id":"25a2d366-2676-48fa-a87f-71878efada8f","block_type":"box","text":"experience delays and limitations with respect to the collection of principal and interest on such","page_number":161,"box":{"x":116,"y":428,"width":711,"height":12}},{"id":"af7b01f0-61bf-4bdf-a848-5078ad999dde","block_type":"box","text":"municipal leases and a Fund may not, in all circumstances, be able to collect all principal and interest","page_number":161,"box":{"x":117,"y":444,"width":755,"height":12}},{"id":"92d29d80-0f5f-4a67-9c57-b70e11fad57d","block_type":"box","text":"to which it is entitled. To enforce its rights in the event of a default in lease payments, a Fund might","page_number":161,"box":{"x":116,"y":459,"width":740,"height":12}},{"id":"4429d83d-d7d3-4475-a971-e1b0f581778c","block_type":"box","text":"take possession of and manage the assets securing the issuer’s obligations on such securities, which","page_number":161,"box":{"x":116,"y":475,"width":758,"height":12}},{"id":"5b89b1dd-e16e-4980-9a8f-3fb0cac6c8e0","block_type":"box","text":"may increase a Fund’s operating expenses and adversely affect the NAV of a Fund. When the lease","page_number":161,"box":{"x":117,"y":490,"width":749,"height":12}},{"id":"ba1fdf36-990f-46bd-9eeb-beec47a9a857","block_type":"box","text":"contains a non-appropriation clause, however, the failure to pay would not be a default and a Fund","page_number":161,"box":{"x":116,"y":506,"width":737,"height":12}},{"id":"d6cbad62-99c3-4258-81c8-2e367d8f28e1","block_type":"box","text":"would not have the right to take possession of the assets. Any income derived from a Fund’s","page_number":161,"box":{"x":116,"y":521,"width":692,"height":12}},{"id":"a7d3458b-0035-43c0-a8f4-eb72fdd14edd","block_type":"box","text":"ownership or operation of such assets may not be tax-exempt. In addition, a Fund’s intention to qualify","page_number":161,"box":{"x":116,"y":537,"width":765,"height":12}},{"id":"c5760f38-6302-4031-bca6-f820baf41ab8","block_type":"box","text":"as a “regulated investment company” under the Code, may limit the extent to which a Fund may","page_number":161,"box":{"x":116,"y":552,"width":717,"height":12}},{"id":"0e61fad5-c5a6-47b3-8fb1-bd1be9004255","block_type":"box","text":"exercise its rights by taking possession of such assets, because as a regulated investment company a","page_number":161,"box":{"x":116,"y":568,"width":765,"height":12}},{"id":"3e5bbba2-f06e-410c-951d-f866fb650b6f","block_type":"box","text":"Fund is subject to certain limitations on its investments and on the nature of its income.","page_number":161,"box":{"x":117,"y":583,"width":650,"height":12}},{"id":"5ec0defa-ba45-4563-8be3-dbaccec3063d","block_type":"box","text":"Tender Option Bonds.","page_number":161,"box":{"x":118,"y":614,"width":161,"height":12}},{"id":"d68ccd9d-13f6-4a6f-b930-e4cd28061642","block_type":"box","text":"Certain Funds may invest in residual inverse floating rate interest tender option","page_number":161,"box":{"x":280,"y":614,"width":596,"height":12}},{"id":"452ef20c-e406-42e5-a22e-919603dbacbe","block_type":"box","text":"bonds (“TOB Residuals”), which are derivative interests in Municipal Bonds. The TOB Residuals in","page_number":161,"box":{"x":117,"y":630,"width":736,"height":12}},{"id":"39fffb0f-1935-4313-8717-eb80e4155eba","block_type":"box","text":"which the Funds will invest pay interest or income that, in the opinion of counsel to the issuer, is","page_number":161,"box":{"x":116,"y":645,"width":715,"height":12}},{"id":"64847f58-ca08-4f15-bcc4-d29962f1776e","block_type":"box","text":"exempt from regular U.S. federal income tax. BlackRock will not conduct its own analysis of the tax","page_number":161,"box":{"x":116,"y":661,"width":735,"height":12}},{"id":"d6b95965-b748-444e-9ca1-dcd78032dcc9","block_type":"box","text":"status of the interest or income paid by TOB Residuals held by the Funds, but will rely on the opinion of","page_number":161,"box":{"x":116,"y":676,"width":767,"height":12}},{"id":"68d614de-130d-464c-a9cc-d5ba432613c4","block_type":"box","text":"counsel to the issuer. Although volatile, TOB Residuals typically offer the potential for yields exceeding","page_number":161,"box":{"x":116,"y":692,"width":761,"height":12}},{"id":"760199aa-966e-41ef-ba2c-653c918775c9","block_type":"box","text":"the yields available on fixed rate Municipal Bonds with comparable credit quality. The Funds may","page_number":161,"box":{"x":116,"y":707,"width":720,"height":12}},{"id":"534a9b40-0613-4f2e-a34d-3c71edf10d11","block_type":"box","text":"invest in TOB Residuals for the purpose of using economic leverage.","page_number":161,"box":{"x":117,"y":723,"width":509,"height":12}},{"id":"4be344d6-f2f8-4d35-accf-1020cfcef660","block_type":"box","text":"TOB Residuals represent beneficial interests in a special purpose trust formed for the purpose of","page_number":161,"box":{"x":116,"y":754,"width":719,"height":12}},{"id":"f2da9e3e-9da6-423a-94e6-512e2c22cc67","block_type":"box","text":"holding Municipal Bonds contributed by one or more funds (a “TOB Trust”). A TOB Trust typically","page_number":161,"box":{"x":117,"y":769,"width":719,"height":12}},{"id":"cfde2db5-75e6-4854-aee1-9c6dedb1e95d","block_type":"box","text":"issues two classes of beneficial interests: short-term floating rate interests (“TOB Floaters”), which are","page_number":161,"box":{"x":117,"y":785,"width":756,"height":12}},{"id":"53d1d4ed-fdb3-4ca0-93f1-05fbbaa02033","block_type":"box","text":"sold to third-party investors, and TOB Residuals, which are generally issued to the fund(s) that","page_number":161,"box":{"x":116,"y":800,"width":701,"height":12}},{"id":"71fef867-ad00-4178-9879-336772f4dde3","block_type":"box","text":"transferred Municipal Bonds to the TOB Trust. The Funds may invest in both TOB Floaters and TOB","page_number":161,"box":{"x":116,"y":816,"width":745,"height":12}},{"id":"9d8a957e-de0f-412a-9526-9582f505d3f5","block_type":"box","text":"Residuals. TOB Floaters may have first priority on the cash flow from the Municipal Bonds held by the","page_number":161,"box":{"x":117,"y":831,"width":759,"height":12}},{"id":"8704e745-2b93-4f24-8267-5b47bf6536c0","block_type":"box","text":"TOB Trust and are enhanced with a liquidity support arrangement from a third-party Liquidity Provider","page_number":161,"box":{"x":116,"y":847,"width":760,"height":12}},{"id":"738cfe49-61e9-46a7-9da2-2fb38186af9a","block_type":"box","text":"(defined below) which allows holders to tender their position at par (plus accrued interest). A Fund, as","page_number":161,"box":{"x":117,"y":862,"width":758,"height":12}},{"id":"1e2e9537-a924-4f61-8186-cd636f8f51b7","block_type":"box","text":"a holder of TOB Residuals, is paid the residual cash flow from the TOB Trust. A Fund that contributes","page_number":161,"box":{"x":116,"y":878,"width":759,"height":12}},{"id":"4a193224-440c-4bd9-a87b-5d6c0880e481","block_type":"box","text":"II-74","page_number":161,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"b17e6de2-2ea3-447d-afd9-20542873f67d","block_type":"box","text":"NM1026U-6004382-161/605","page_number":161,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"bbb940f7-2aa4-47fe-804a-fad5d121fd68","block_type":"box","text":"the Municipal Bonds to the TOB Trust is paid the cash received by the TOB Trust from the sale of the","page_number":162,"box":{"x":116,"y":87,"width":757,"height":12}},{"id":"f38f02bd-b159-4a30-b528-57edfcd32b88","block_type":"box","text":"TOB Floaters, less certain transaction costs, and typically will invest the cash to purchase additional","page_number":162,"box":{"x":116,"y":102,"width":746,"height":13}},{"id":"4614e33b-e0d1-4e19-8e3e-3cd9460fd3de","block_type":"box","text":"Municipal Bonds or other investments permitted by its investment policies. If a Fund ever purchases all","page_number":162,"box":{"x":117,"y":118,"width":767,"height":12}},{"id":"1cc3d6a2-ec7a-4407-ad42-94d45d8fe119","block_type":"box","text":"or a portion of the TOB Floaters sold by the TOB Trust, it may surrender those TOB Floaters together","page_number":162,"box":{"x":116,"y":134,"width":758,"height":12}},{"id":"4c4f1f30-2fa9-4abe-9794-de683a5a7fb9","block_type":"box","text":"with a proportionate amount of TOB Residuals to the TOB Trust in exchange for a proportionate","page_number":162,"box":{"x":116,"y":149,"width":717,"height":12}},{"id":"82480cc6-d3aa-4d5e-bcf1-5e43ef466b59","block_type":"box","text":"amount of the Municipal Bonds owned by the TOB Trust.","page_number":162,"box":{"x":116,"y":165,"width":427,"height":12}},{"id":"0a7f8a7e-10b3-4730-87c9-587e52ef7639","block_type":"box","text":"Other BlackRock-advised funds may contribute Municipal Bonds to a TOB Trust into which a Fund has","page_number":162,"box":{"x":116,"y":196,"width":767,"height":12}},{"id":"55a12044-d7f7-44c8-8074-cf425ad5a6e7","block_type":"box","text":"contributed Municipal Bonds. If multiple BlackRock-advised funds participate in the same TOB Trust,","page_number":162,"box":{"x":116,"y":211,"width":752,"height":12}},{"id":"68ab07d0-b1d5-411a-9dae-f0afdc67e7fd","block_type":"box","text":"the economic rights and obligations under the TOB Residual will generally be shared among the funds","page_number":162,"box":{"x":116,"y":227,"width":764,"height":12}},{"id":"d3391fe4-ec61-45a5-9193-2930b21ffae1","block_type":"box","text":"ratably in proportion to their participation in the TOB Trust.","page_number":162,"box":{"x":117,"y":242,"width":437,"height":12}},{"id":"9d182523-7cc2-4eed-bcfb-04647854a7fe","block_type":"box","text":"The Municipal Bonds transferred to a TOB Trust typi","page_number":162,"box":{"x":116,"y":273,"width":380,"height":12}},{"id":"01ffb6b9-9885-4b9c-baf6-97a4cd93f89f","block_type":"box","text":"cally are high grade Municipal Bonds. In certain","page_number":162,"box":{"x":497,"y":273,"width":350,"height":12}},{"id":"386918b2-c241-41b6-835a-423aaf141c69","block_type":"box","text":"cases, when Municipal Bonds transferred are lowe","page_number":162,"box":{"x":116,"y":289,"width":367,"height":12}},{"id":"01117938-f413-4047-9fb6-4b07db856f9c","block_type":"box","text":"r grade Municipal Bonds, the TOB Trust transaction","page_number":162,"box":{"x":485,"y":289,"width":379,"height":12}},{"id":"116374f5-afba-4074-adba-0ae1c51d6a6c","block_type":"box","text":"includes a credit enhancement feature that provides fo","page_number":162,"box":{"x":117,"y":304,"width":395,"height":12}},{"id":"92855a16-2e1b-4451-bd58-18483cf32745","block_type":"box","text":"r the timely payment of principal and interest on","page_number":162,"box":{"x":513,"y":304,"width":349,"height":12}},{"id":"1d2df04e-410d-41ff-aa6d-7d52c869d41b","block_type":"box","text":"the bonds to the TOB Trust by a credit enhancement","page_number":162,"box":{"x":116,"y":320,"width":388,"height":12}},{"id":"d7b9edad-02dc-4f6b-811b-7c4db7c032e9","block_type":"box","text":"provider. The TOB Trust would be responsible for","page_number":162,"box":{"x":505,"y":320,"width":364,"height":12}},{"id":"d7fb3415-4ed7-47fe-a948-28dbdf252c1d","block_type":"box","text":"the payment of the credit enhancem","page_number":162,"box":{"x":116,"y":335,"width":262,"height":12}},{"id":"67383875-5ed7-4762-abb8-6b3cc368a25b","block_type":"box","text":"ent fee and a Fund, as a TOB Residual holder, would be responsible","page_number":162,"box":{"x":379,"y":335,"width":504,"height":12}},{"id":"c60688bf-6093-43ae-8436-71cc50dbece0","block_type":"box","text":"for reimbursement of any payments of principal","page_number":162,"box":{"x":116,"y":351,"width":348,"height":12}},{"id":"2bd7fe56-827d-46ba-983d-8d5ca6cbb44f","block_type":"box","text":"and interest made by the credit enhancement provider.","page_number":162,"box":{"x":464,"y":351,"width":403,"height":12}},{"id":"2afbc29e-04af-4027-a6ab-aedb8e24c3b1","block_type":"box","text":"The TOB Residuals held by a Fund generally provide t","page_number":162,"box":{"x":116,"y":382,"width":396,"height":12}},{"id":"9599e2ff-6745-445f-b129-68654a5edb95","block_type":"box","text":"he Fund with the right to cause the holders of a","page_number":162,"box":{"x":513,"y":382,"width":346,"height":12}},{"id":"7d7d5a93-0263-490f-8ca9-ec7e8e790a2d","block_type":"box","text":"proportional share of the TOB Floaters","page_number":162,"box":{"x":117,"y":397,"width":284,"height":12}},{"id":"f0470f9d-6249-4308-8473-d614e94a3f81","block_type":"box","text":"to tender their notes to the TOB Trust at par plus accrued interest.","page_number":162,"box":{"x":401,"y":397,"width":485,"height":12}},{"id":"a500514f-eee3-4b51-9c61-99ba498692dc","block_type":"box","text":"Thereafter, the Fund may withdraw a corresponding share","page_number":162,"box":{"x":116,"y":413,"width":428,"height":12}},{"id":"677c0a72-33fe-419c-9d07-b110b1bb98c7","block_type":"box","text":"of the Municipal Bonds from the TOB Trust.","page_number":162,"box":{"x":545,"y":413,"width":321,"height":12}},{"id":"3b2280f1-77de-4789-a7f8-ad809d52b18e","block_type":"box","text":"This transaction, in effect, creates exposure for the Fund","page_number":162,"box":{"x":116,"y":428,"width":416,"height":12}},{"id":"94a435c8-5d1e-4fea-b5d0-f8556b5452da","block_type":"box","text":"to the entire return of the Municipal Bonds in the","page_number":162,"box":{"x":532,"y":428,"width":355,"height":12}},{"id":"42d2ab9c-0460-4cfc-9931-b4ff8523baee","block_type":"box","text":"TOB Trust, with a net cash investment by the Fund that","page_number":162,"box":{"x":116,"y":444,"width":403,"height":12}},{"id":"64cdaefa-ada1-4cf4-aca4-1b1a0b0a9495","block_type":"box","text":"t is less than the value of the Municipal Bonds in","page_number":162,"box":{"x":519,"y":444,"width":351,"height":12}},{"id":"c9b10b0c-c83c-4c0d-aeaf-7182b5941f28","block_type":"box","text":"the TOB Trust. This multiplies the positive or negative","page_number":162,"box":{"x":116,"y":459,"width":395,"height":12}},{"id":"e60fbe49-76b1-420e-9e0e-3f7c77f4546f","block_type":"box","text":"impact of the Municipal Bonds’ return within the","page_number":162,"box":{"x":512,"y":459,"width":348,"height":12}},{"id":"6f670fdc-6e9a-4e3a-b04f-d63ecac38e32","block_type":"box","text":"Fund (thereby creating leverage). The leverage within a","page_number":162,"box":{"x":117,"y":475,"width":408,"height":12}},{"id":"6c404406-9f32-4df4-a4bd-04349347e70a","block_type":"box","text":"TOB Trust depends on the value of the Municipal","page_number":162,"box":{"x":525,"y":475,"width":362,"height":12}},{"id":"ce05b772-a098-4ea2-af4e-5056ee66e82d","block_type":"box","text":"Bonds deposited in the TOB Trust relative to","page_number":162,"box":{"x":117,"y":490,"width":327,"height":12}},{"id":"e602e470-cfcc-440f-8d8c-99c26e9c03e9","block_type":"box","text":"the value of the TOB Floaters it issues.","page_number":162,"box":{"x":444,"y":490,"width":288,"height":10}},{"id":"73dea1ad-5855-444b-82bf-32eeba26be63","block_type":"box","text":"A Fund may invest in highly leveraged TOB Residuals. A TOB Residual generally is considered highly","page_number":162,"box":{"x":116,"y":521,"width":762,"height":12}},{"id":"8e15108b-6c9e-416d-8306-ea55177105a3","block_type":"box","text":"leveraged if the principal amount of the TOB Floaters issued by the related TOB Trust exceeds 75% of","page_number":162,"box":{"x":117,"y":537,"width":765,"height":12}},{"id":"c49b52aa-b4e7-467f-a8fd-0f74a4419f1a","block_type":"box","text":"the principal amount of the Municipal Bonds owned by the TOB Trust.","page_number":162,"box":{"x":116,"y":552,"width":523,"height":12}},{"id":"9b2b32bc-b817-4334-bb98-7890917d9be9","block_type":"box","text":"The TOB Trust may be collapsed without the consent of a Fund upon the occurrence of tender option","page_number":162,"box":{"x":116,"y":583,"width":757,"height":12}},{"id":"ccb504ad-deda-4b90-bac3-6be6466b6ebe","block_type":"box","text":"termination events (“TOTEs”) and mandatory termination events (“MTEs”), as defined in the TOB Trust","page_number":162,"box":{"x":116,"y":599,"width":768,"height":12}},{"id":"09553855-513c-498c-baa4-1aea4cc7115f","block_type":"box","text":"agreements. TOTEs include the bankruptcy or default of the issuer of the Municipal Bonds held in the","page_number":162,"box":{"x":116,"y":614,"width":758,"height":12}},{"id":"3627cc6b-e57e-43ea-b823-2a6ee1e1bf0a","block_type":"box","text":"TOB Trust, a substantial downgrade in the credit quality of the issuer of the Municipal Bonds held in","page_number":162,"box":{"x":116,"y":630,"width":744,"height":12}},{"id":"36a78263-afcb-440b-98cc-41f03fdd8825","block_type":"box","text":"the TOB Trust, failure of any scheduled payment of principal or interest on the Municipal Bonds, and a","page_number":162,"box":{"x":116,"y":645,"width":763,"height":12}},{"id":"d8739db5-d79f-4c1c-b197-edc393be0111","block_type":"box","text":"judgment or ruling that interest on the Municipal Bonds is subject to U.S. federal income taxation.","page_number":162,"box":{"x":115,"y":661,"width":721,"height":12}},{"id":"3126a03f-9953-476d-a2fa-44a0a988d946","block_type":"box","text":"MTEs may include, among other things, a failed remarketing of the TOB Floaters, the inability of the","page_number":162,"box":{"x":117,"y":676,"width":739,"height":12}},{"id":"fe3910e3-6c7b-4290-8caa-bc38e04b2ab3","block_type":"box","text":"TOB Trust to obtain renewal of the liquidity support agreement, and a substantial decline in the market","page_number":162,"box":{"x":116,"y":692,"width":760,"height":12}},{"id":"67f2c7b4-6320-448e-98a8-13bc8cc419c8","block_type":"box","text":"value of the Municipal Bonds held in the TOB Trust. Upon the occurrence of a TOTE or an MTE, a","page_number":162,"box":{"x":116,"y":707,"width":729,"height":12}},{"id":"3c3b7a0d-7962-4e06-bff0-ec6e37505b55","block_type":"box","text":"TOB Trust would be liquidated with the proceeds applied first to any accrued fees owed to the trustee","page_number":162,"box":{"x":116,"y":723,"width":752,"height":12}},{"id":"d8162a59-992d-40e9-bbd9-bf1283993fc8","block_type":"box","text":"of the TOB Trust, the remarketing agent of the TOB Floaters and the Liquidity Provider (defined","page_number":162,"box":{"x":116,"y":738,"width":708,"height":12}},{"id":"c2fdf4c0-ef4f-4df3-bd4c-4f10a28c0f3c","block_type":"box","text":"below). In the case of an MTE, after the payment of fees, the holders of the TOB Floaters would be","page_number":162,"box":{"x":117,"y":754,"width":734,"height":12}},{"id":"c80260b2-180f-4473-806a-5f4616663fd6","block_type":"box","text":"paid senior to the TOB Residual holders (","page_number":162,"box":{"x":117,"y":769,"width":307,"height":12}},{"id":"b54d6e54-9ea4-403f-be60-a339eac7aaf0","block_type":"box","text":"i.e.","page_number":162,"box":{"x":425,"y":769,"width":20,"height":10}},{"id":"94d0381a-55a1-4139-83a9-1c560945cf7d","block_type":"box","text":", the Fund). In contrast, in the case of a TOTE, after","page_number":162,"box":{"x":448,"y":769,"width":385,"height":12}},{"id":"e5030f96-0b60-45f5-821e-3a9402e5530d","block_type":"box","text":"payment of fees, the holders of TOB Floaters and the TOB Residual holders would be paid pro rata in","page_number":162,"box":{"x":117,"y":785,"width":753,"height":12}},{"id":"c5c6092f-e124-4f38-8a46-f079cd6cbb4e","block_type":"box","text":"proportion to the respective face values of their certificates.","page_number":162,"box":{"x":117,"y":800,"width":437,"height":12}},{"id":"26dcf110-90d6-42ec-b667-ee47b204fdc7","block_type":"box","text":"A Fund may invest in a TOB Trust on either a non-recourse or recourse basis. TOB Trusts are typically","page_number":162,"box":{"x":116,"y":831,"width":769,"height":12}},{"id":"f74b007c-5374-4af9-bf88-0773a1bc9284","block_type":"box","text":"supported by a liquidity facility provided by a third-party bank or other financial institution (the “Liquidity","page_number":162,"box":{"x":116,"y":847,"width":766,"height":12}},{"id":"eb513d1a-8394-41d8-b015-5389432ee8ae","block_type":"box","text":"Provider”) that allows the holders of the TOB Floaters to tender their TOB Floaters in exchange for","page_number":162,"box":{"x":117,"y":862,"width":734,"height":12}},{"id":"44872553-ee5c-4e3a-af1c-81cad99f9758","block_type":"box","text":"payment of par plus accrued interest on any business day (subject to the non-occurrence of a TOTE","page_number":162,"box":{"x":117,"y":878,"width":748,"height":12}},{"id":"5d68b777-c7ca-42ee-8bfb-5e15561d9b35","block_type":"box","text":"II-75","page_number":162,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"f6252faf-f615-448f-93ef-e020cfa4f01f","block_type":"box","text":"NM1026U-6004382-162/605","page_number":162,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"11345588-566c-45c9-a150-c7124b277824","block_type":"box","text":"described above). Depending on the structure of the TOB Trust, the Liquidity Provider may purchase","page_number":163,"box":{"x":116,"y":87,"width":752,"height":12}},{"id":"8a537d91-a957-4385-9660-c24c3e8da2a8","block_type":"box","text":"the tendered TOB Floaters, or the TOB Trust may draw upon a loan from the Liquidity Provider to","page_number":163,"box":{"x":116,"y":102,"width":728,"height":13}},{"id":"1ff1af56-80db-465a-a77e-c4120e9f7ccc","block_type":"box","text":"purchase the tendered TOB Floaters.","page_number":163,"box":{"x":117,"y":118,"width":281,"height":12}},{"id":"338fd6b2-ab96-4a5a-b0d4-9c24bb13a2bd","block_type":"box","text":"When a Fund invests in TOB Trusts on a non-recourse basis, and the Liquidity Provider is required to","page_number":163,"box":{"x":116,"y":149,"width":758,"height":12}},{"id":"0769ca1b-3c9c-4819-a3a5-ce7f4da6eac4","block_type":"box","text":"make a payment under the liquidity facility, the Liquidity Provider will typically liquidate all or a portion","page_number":163,"box":{"x":117,"y":165,"width":753,"height":12}},{"id":"b0257193-7a78-4407-aa3a-766b6e3c2f3a","block_type":"box","text":"of the Municipal Bonds held in the TOB Trust and then fund the balance, if any, of the amount owed","page_number":163,"box":{"x":116,"y":180,"width":746,"height":12}},{"id":"b80f06c8-9616-4172-9b7d-774e593e9b97","block_type":"box","text":"under the liquidity facility over the liquidation proceeds (the “Liquidation Shortfall”). If a Fund invests in","page_number":163,"box":{"x":117,"y":196,"width":760,"height":12}},{"id":"542bcfb8-7914-4723-832f-36488b3afa5d","block_type":"box","text":"a TOB Trust on a recourse basis, it will typically enter into a reimbursement agreement with the","page_number":163,"box":{"x":116,"y":211,"width":712,"height":12}},{"id":"abb6a427-1464-4d11-b106-2a266667ee9c","block_type":"box","text":"Liquidity Provider pursuant to which the Fund is required to reimburse the Liquidity Provider the","page_number":163,"box":{"x":117,"y":227,"width":712,"height":12}},{"id":"50ac5696-9bab-448b-b8c5-ec508f5de2e5","block_type":"box","text":"amount of any Liquidation Shortfall. As a result, if the Fund invests in a recourse TOB Trust, the Fund","page_number":163,"box":{"x":116,"y":242,"width":759,"height":12}},{"id":"8f0f2eb6-ba78-48eb-95a4-7413fa1a9491","block_type":"box","text":"will bear the risk of loss with respect to any Liquidation Shortfall. If multiple BlackRock-advised funds","page_number":163,"box":{"x":116,"y":258,"width":751,"height":12}},{"id":"90f2c06d-fa4f-4e91-9b7f-2990b85c9eb8","block_type":"box","text":"participate in any such TOB Trust, these losses will be shared ratably, in proportion to their","page_number":163,"box":{"x":117,"y":273,"width":678,"height":12}},{"id":"efcc073b-695f-4b8d-82fa-8eb8cb18feab","block_type":"box","text":"participation in the TOB Trust.","page_number":163,"box":{"x":117,"y":289,"width":227,"height":12}},{"id":"6a58cab7-7dd1-47a6-9318-124de453f186","block_type":"box","text":"Under accounting rules, Municipal Bonds of a Fund that are deposited into a TOB Trust are","page_number":163,"box":{"x":117,"y":320,"width":682,"height":12}},{"id":"d634d08e-8fe4-4d8c-b1de-1f4687766f19","block_type":"box","text":"investments of the Fund and are presented on the Fund’s Schedule of Investments and outstanding","page_number":163,"box":{"x":117,"y":335,"width":745,"height":12}},{"id":"d0bc7828-e8e9-4c71-8fd0-420c5b057115","block_type":"box","text":"TOB Floaters issued by a TOB Trust are presented as liabilities in the Fund’s Statement of Assets and","page_number":163,"box":{"x":116,"y":351,"width":765,"height":12}},{"id":"74bdc81c-7433-42a3-ab20-6b55c805039f","block_type":"box","text":"Liabilities. Interest income from the underlying Municipal Bonds is recorded by a Fund on an accrual","page_number":163,"box":{"x":117,"y":366,"width":747,"height":12}},{"id":"3edb9312-0dcf-4510-9dbd-7f95e7b38898","block_type":"box","text":"basis. Interest expense incurred on the","page_number":163,"box":{"x":117,"y":382,"width":288,"height":12}},{"id":"6167fb2b-93a5-4bd8-a0c0-799829060d7c","block_type":"box","text":"TOB Floaters and other expenses related to remarketing,","page_number":163,"box":{"x":409,"y":382,"width":430,"height":12}},{"id":"79eb1d40-7a51-42c3-b0d1-64237ba4f838","block_type":"box","text":"administration, trustee and other services to a TOB Trust are reported as expenses of a Fund. In","page_number":163,"box":{"x":116,"y":397,"width":722,"height":12}},{"id":"73d2ebdc-da76-4701-855f-d3245e2572c3","block_type":"box","text":"addition, under accounting rules, loans made to a TOB Trust sponsored by a Fund may be presented","page_number":163,"box":{"x":116,"y":413,"width":757,"height":12}},{"id":"5781853d-818d-4e67-bbb9-78b6c9b20866","block_type":"box","text":"as loans of the Fund in the Fund’s financial statements even if there is no recourse to the Fund’s","page_number":163,"box":{"x":116,"y":428,"width":721,"height":10}},{"id":"5a310e76-729c-454e-bcbe-31baf348c6e2","block_type":"box","text":"assets.","page_number":163,"box":{"x":116,"y":444,"width":58,"height":9}},{"id":"aebcddb5-a93e-4ddb-96e7-965b08784bcb","block_type":"box","text":"For TOB Floaters, generally, the interest rate earned will be based upon the market rates for Municipal","page_number":163,"box":{"x":117,"y":475,"width":765,"height":12}},{"id":"84999414-ddb4-4ab4-87c2-61a5770505be","block_type":"box","text":"Bonds with maturities or remarketing provisions that are comparable in duration to the periodic interval","page_number":163,"box":{"x":117,"y":490,"width":764,"height":12}},{"id":"3c9c93be-3d8d-4399-bf9a-a58a718eff6b","block_type":"box","text":"of the tender option. Since the tender option feature has a shorter term than the final maturity or first","page_number":163,"box":{"x":116,"y":506,"width":748,"height":12}},{"id":"94834c06-1403-4344-ad61-c2103d962e7a","block_type":"box","text":"call date of the underlying Municipal Bonds deposited in the TOB Trust, the holder of the TOB Floaters","page_number":163,"box":{"x":116,"y":521,"width":766,"height":12}},{"id":"897d8577-4a57-4c7f-91eb-f017406e3593","block_type":"box","text":"relies upon the terms of the agreement with the financial institution furnishing the liquidity facility as","page_number":163,"box":{"x":117,"y":537,"width":738,"height":12}},{"id":"80623b8c-11f6-47ee-8275-d12c33dd9e75","block_type":"box","text":"well as the credit strength of that institution. The risk associated with TOB Floaters, however, may be","page_number":163,"box":{"x":116,"y":552,"width":754,"height":12}},{"id":"71ae2b25-33f7-48d6-8aec-aed49a229ec1","block_type":"box","text":"increased in the current market environment as a result of recent downgrades to the credit ratings, and","page_number":163,"box":{"x":117,"y":568,"width":767,"height":12}},{"id":"60aa43f0-c0b9-4827-ab36-3c94be9a0ccf","block_type":"box","text":"thus the perceived reliability and creditworthiness, of many major financial institutions, some of which","page_number":163,"box":{"x":116,"y":583,"width":755,"height":12}},{"id":"44823967-d9c2-4786-8631-25923705316b","block_type":"box","text":"sponsor and/or provide liquidity support to TOB Trusts. This in turn may reduce the desirability of TOB","page_number":163,"box":{"x":116,"y":599,"width":763,"height":12}},{"id":"7eba70a8-1e8d-4f7d-868a-aacbfbe556b0","block_type":"box","text":"Floaters as investments, which could impair the viability or availability of TOB Trusts.","page_number":163,"box":{"x":117,"y":614,"width":633,"height":12}},{"id":"7bb58fd8-9939-4ea2-b7cd-685f71d6910e","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into TOB Trust transactions,","page_number":163,"box":{"x":117,"y":645,"width":727,"height":12}},{"id":"9d4bf781-4aa6-4a05-8dd5-47fc91323647","block_type":"box","text":"reverse repurchase agreements and similar financing transactions (e.g., borrowed bonds)","page_number":163,"box":{"x":117,"y":661,"width":650,"height":12}},{"id":"49946a46-274a-4e02-ae62-18f4f9a2842e","block_type":"box","text":"notwithstanding the limitation","page_number":163,"box":{"x":117,"y":676,"width":209,"height":12}},{"id":"9ce70c91-aa49-4dd2-acfb-bdac2bd38f4d","block_type":"box","text":"on the issuance of senior securities in Section 18 of the Investment","page_number":163,"box":{"x":332,"y":676,"width":487,"height":10}},{"id":"dd10b9cc-88b0-4f78-9a66-212391b2b4f8","block_type":"box","text":"Company Act, provided that the Fund either (i) comp","page_number":163,"box":{"x":117,"y":692,"width":381,"height":12}},{"id":"1899b7e9-ef65-4ab6-b0cd-21c4be186055","block_type":"box","text":"lies with the 300% asset coverage ratio with respect","page_number":163,"box":{"x":499,"y":692,"width":377,"height":12}},{"id":"398d2f34-5698-4765-9e56-175e95271f15","block_type":"box","text":"to such transactions and any other borrowings in t","page_number":163,"box":{"x":116,"y":707,"width":363,"height":12}},{"id":"6a0675d6-22d0-431f-b412-eda03fb12a6f","block_type":"box","text":"he aggregate, or (ii) treats such transactions as","page_number":163,"box":{"x":480,"y":707,"width":342,"height":12}},{"id":"8537e048-087f-4e7b-83f7-7d0f4398ded4","block_type":"box","text":"Derivatives Transactions under Rule 18f-4. See “—","page_number":163,"box":{"x":117,"y":723,"width":372,"height":9}},{"id":"c5d62cf4-c535-43b7-a292-fb402b70e50d","block_type":"box","text":"Derivatives—Regulation of Derivatives—Rule 18f-4","page_number":163,"box":{"x":489,"y":723,"width":372,"height":12}},{"id":"7235de38-3aa8-45c6-be3f-5fb8b7bc7b43","block_type":"box","text":"under the Investment Company Act” above.","page_number":163,"box":{"x":117,"y":738,"width":316,"height":12}},{"id":"ee76dc76-9881-4318-9c98-865d3f4e4c4e","block_type":"box","text":"Developments in the TOB Trust Market","page_number":163,"box":{"x":116,"y":769,"width":292,"height":12}},{"id":"97fc4ae3-36bb-4596-8bd6-05038fe97d9d","block_type":"box","text":". In response to the restrictions imposed by section 619 of the","page_number":163,"box":{"x":409,"y":769,"width":457,"height":12}},{"id":"b2a1edbd-64d9-49e5-9bb3-d3e2af9c47d5","block_type":"box","text":"Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Volcker Rule”), market participants","page_number":163,"box":{"x":117,"y":785,"width":761,"height":12}},{"id":"da850652-2829-4c39-9cba-9b2dad5e25e7","block_type":"box","text":"have developed a structure for TOB Trusts designed to ensure that no banking entity is sponsoring the","page_number":163,"box":{"x":117,"y":800,"width":761,"height":12}},{"id":"7a4102b0-725e-45a5-bb9e-8f45b11ed4dd","block_type":"box","text":"TOB Trust for purposes of the Volcker Rule. Specifically, a Fund will establish, structure and “sponsor”","page_number":163,"box":{"x":116,"y":816,"width":760,"height":12}},{"id":"313339ea-fea4-4041-81b3-72c2275aa4da","block_type":"box","text":"the TOB Trusts in which it holds TOB Residuals. In such a structure, certain responsibilities that","page_number":163,"box":{"x":116,"y":831,"width":715,"height":12}},{"id":"842d612b-e052-4c92-bd16-6366a55159a0","block_type":"box","text":"previously belonged to the sponsor bank will be performed by, or on behalf of, a Fund. A Fund may","page_number":163,"box":{"x":117,"y":847,"width":740,"height":12}},{"id":"d03bcc08-b134-4fbf-9a7f-0b6858fdbdfd","block_type":"box","text":"utilize service providers in meeting these responsibilities. It is possible that regulators could take","page_number":163,"box":{"x":117,"y":862,"width":717,"height":12}},{"id":"505fd8c6-1651-4c39-bb4b-6cacd779dd4b","block_type":"box","text":"positions that could limit the market for such structured TOB Trust transactions or a Fund’s ability to","page_number":163,"box":{"x":117,"y":878,"width":744,"height":12}},{"id":"57dab808-d4e7-46e9-8b16-6d815f5e1c03","block_type":"box","text":"II-76","page_number":163,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"841d55fc-3bae-4b7d-bd71-03953649d7dd","block_type":"box","text":"NM1026U-6004382-163/605","page_number":163,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"1c3b5d46-ea44-4eb3-ae84-2aaa4fd5c1f4","block_type":"box","text":"hold TOB Residuals. Under this TOB Trust structure, a Fund has certain additional duties and","page_number":164,"box":{"x":117,"y":87,"width":699,"height":11}},{"id":"04c8118d-ff34-457c-b704-f6bb1b74bf4e","block_type":"box","text":"responsibilities, which may give rise to certain additional risks including","page_number":164,"box":{"x":117,"y":103,"width":525,"height":12}},{"id":"5eaaad24-e73b-4e38-84b1-a48dbee6002d","block_type":"box","text":",","page_number":164,"box":{"x":643,"y":111,"width":3,"height":3}},{"id":"7a76ba6a-437e-45a8-887c-717ce6b371ed","block_type":"box","text":"but not limited to, compliance,","page_number":164,"box":{"x":648,"y":103,"width":232,"height":11}},{"id":"52a822f6-514d-4399-8419-0afac2f32c91","block_type":"box","text":"securities law and operational risks.","page_number":164,"box":{"x":116,"y":118,"width":270,"height":12}},{"id":"09130c55-33a9-4d5a-b9d3-78e1c2be9dd3","block_type":"box","text":"Under this structure, service providers to a TOB Trust, such as administrators, liquidity providers,","page_number":164,"box":{"x":117,"y":149,"width":724,"height":12}},{"id":"1dc4f34f-5836-4dca-8ea1-6bfe68fbe67f","block_type":"box","text":"trustees, and remarketing agents, act at the direction of, and as agent of, a Fund as the TOB Residual","page_number":164,"box":{"x":116,"y":165,"width":764,"height":12}},{"id":"52aa5049-976c-40e3-87ab-2c80f46d7075","block_type":"box","text":"holder. Similar to the traditional tender option bond structure, a Fund deposits Municipal Bonds into the","page_number":164,"box":{"x":117,"y":180,"width":768,"height":12}},{"id":"124a91f7-5d4e-4f62-8a84-db80c8972902","block_type":"box","text":"TOB Trust in exchange for TOB Residuals, the TOB Trust then issues and sells TOB Floaters to third","page_number":164,"box":{"x":116,"y":196,"width":757,"height":12}},{"id":"fbb6d9ea-14ee-4b52-907b-3de593dbdeab","block_type":"box","text":"party investors, and the proceeds of the sale of the TOB Floaters is distributed to such TOB Residual","page_number":164,"box":{"x":117,"y":211,"width":754,"height":12}},{"id":"fe9ee609-c40f-40df-8ffa-4401371fe365","block_type":"box","text":"holders (","page_number":164,"box":{"x":117,"y":227,"width":64,"height":12}},{"id":"80cf14f8-f2af-4fc6-a171-f1df654f6bf5","block_type":"box","text":"i.e.","page_number":164,"box":{"x":182,"y":227,"width":20,"height":9}},{"id":"64924022-b5cd-4b3f-b61a-ce0021d0274d","block_type":"box","text":", the Fund). Tendered TOB Floaters continue to be supported by a remarketing agent and","page_number":164,"box":{"x":205,"y":227,"width":671,"height":12}},{"id":"a93492ef-fa59-4805-9c6a-0cab4132ec00","block_type":"box","text":"a liquidity facility. However, the remarketing agent does not purchase tendered TOB Floaters for its","page_number":164,"box":{"x":116,"y":242,"width":740,"height":12}},{"id":"d41e339e-bea1-47f5-a216-e734a9b5e9cc","block_type":"box","text":"own account in the event of a failed remarketing, which may increase the likelihood that a TOB Trust","page_number":164,"box":{"x":116,"y":258,"width":751,"height":12}},{"id":"81ee32c9-aa7a-43b5-a9a8-aaca26247c7e","block_type":"box","text":"will need to be collapsed and liquidated in order to purchase the tendered TOB Floaters. In the event of","page_number":164,"box":{"x":116,"y":273,"width":772,"height":12}},{"id":"fbbb204a-c2be-4bac-9d3f-592cb460fff2","block_type":"box","text":"a failed remarketing of TOB Floaters, the Liquidity Provider, at its option, may advance a loan to the","page_number":164,"box":{"x":116,"y":289,"width":745,"height":12}},{"id":"4dcb6052-bfec-4d19-8976-b2e5c48d7431","block_type":"box","text":"TOB Trust the proceeds of which would be used by the TOB Trust to purchase the tendered TOB","page_number":164,"box":{"x":116,"y":304,"width":728,"height":12}},{"id":"ad38f784-506c-4d3e-b6aa-8a05354a81f4","block_type":"box","text":"Floaters. The Liquidity Provider is not obligated to advance such a loan. The TOB Trust would be the","page_number":164,"box":{"x":117,"y":320,"width":753,"height":12}},{"id":"358b41e8-0c30-43dc-903a-e209198d896b","block_type":"box","text":"borrower with respect to any such loan. Any loans made by a Liquidity Provider will be secured by the","page_number":164,"box":{"x":117,"y":335,"width":758,"height":12}},{"id":"9b25b78d-d65a-4dea-a622-6b00150a2c1b","block_type":"box","text":"purchased TOB Floaters held by the TOB Trust.","page_number":164,"box":{"x":117,"y":351,"width":361,"height":12}},{"id":"dc0f0af5-851d-4583-8fdb-2074c9ee8a84","block_type":"box","text":"Similar to the traditional structure for TOB Trusts, a Fund may hold either non-recourse TOB Residuals","page_number":164,"box":{"x":116,"y":382,"width":769,"height":12}},{"id":"187fc51c-46b1-4dd2-b0b9-21b30581ba72","block_type":"box","text":"or recourse TOB Residuals under this structure. In the event of a Liquidation Shortfall, there would","page_number":164,"box":{"x":116,"y":397,"width":735,"height":12}},{"id":"b8146748-2c2d-4800-a454-93e505b7e9a8","block_type":"box","text":"generally be no contractual recourse to the Fund’s assets if the Fund holds a non-recourse TOB","page_number":164,"box":{"x":116,"y":413,"width":718,"height":12}},{"id":"d9a541f1-acd0-4deb-a9f4-d67c8177ccc6","block_type":"box","text":"Residual. However, as described above, a Fund would bear the risk of loss with respect to any","page_number":164,"box":{"x":117,"y":428,"width":706,"height":12}},{"id":"f5537914-bfc1-43f2-9b5b-14ad56253c62","block_type":"box","text":"Liquidation Shortfall if it holds a recourse TOB Residual.","page_number":164,"box":{"x":117,"y":444,"width":421,"height":12}},{"id":"fffe3400-8fa2-41d0-b9d0-7bda3670b875","block_type":"box","text":"The SEC and various federal banking and housing agencies adopted credit risk retention rules for","page_number":164,"box":{"x":116,"y":475,"width":730,"height":12}},{"id":"2281aa3d-332e-4a76-8324-df0597abd53b","block_type":"box","text":"securitizations (the “Risk Retention Rules”), which took effect in December 2016. The Risk Retention","page_number":164,"box":{"x":116,"y":490,"width":753,"height":12}},{"id":"d022f5e3-618b-40cd-bbe3-a6ccd3d1e626","block_type":"box","text":"Rules require the sponsor of a TOB Trust to retain at least 5% of the credit risk of the underlying assets","page_number":164,"box":{"x":117,"y":506,"width":771,"height":12}},{"id":"7e7018ad-8807-4448-a21d-784041c7bd34","block_type":"box","text":"supporting the TOB Trust’s Municipal Bonds. The Risk Retention Rules may adversely affect the","page_number":164,"box":{"x":116,"y":521,"width":721,"height":12}},{"id":"281c3332-24b0-4177-99ee-db681a0a0476","block_type":"box","text":"Fund’s ability to engage in TOB Trust transactions or increase the costs of such transactions in certain","page_number":164,"box":{"x":117,"y":537,"width":764,"height":12}},{"id":"85e860ab-c91f-4308-ba7b-a07102a98363","block_type":"box","text":"circumstances.","page_number":164,"box":{"x":116,"y":552,"width":117,"height":10}},{"id":"043eb375-f7d0-43f6-9b1a-d0fb0512d919","block_type":"box","text":"TOB Trust transactions constitute an important component of the municipal bond market. Accordingly,","page_number":164,"box":{"x":116,"y":583,"width":763,"height":12}},{"id":"2eaa6d9e-43dc-4792-98b0-10472c8652cb","block_type":"box","text":"implementation of the Volcker Rule may adversely impact the municipal market, including through","page_number":164,"box":{"x":117,"y":599,"width":729,"height":12}},{"id":"1885e7c8-996e-414b-93c7-c8e81320ebdb","block_type":"box","text":"reduced demand for and liquidity of municipal bonds and increased financing costs for municipal","page_number":164,"box":{"x":117,"y":614,"width":719,"height":12}},{"id":"2846fc63-4f07-48ca-9035-0ed5324fdee1","block_type":"box","text":"issuers. Any such developments could adversely affect the Funds. The ultimate impact of these rules","page_number":164,"box":{"x":117,"y":630,"width":754,"height":12}},{"id":"dce2b233-3423-43c5-8a6c-e3366ce127a1","block_type":"box","text":"on the TOB market and the overall municipal market is not yet certain.","page_number":164,"box":{"x":116,"y":645,"width":520,"height":12}},{"id":"52e8f644-4c3f-4650-a97a-824b62ade9d5","block_type":"box","text":"Yields.","page_number":164,"box":{"x":118,"y":676,"width":47,"height":10}},{"id":"315c15b0-5f76-4f2b-b06a-a97fc5e7bca3","block_type":"box","text":"Yields on Municipal Bonds are dependent on a variety of factors, including the general","page_number":164,"box":{"x":171,"y":676,"width":639,"height":12}},{"id":"dc733b33-6078-456e-8175-efc3d6d90ebe","block_type":"box","text":"condition of the money market and of the municipal bond market, the size of a particular offering, the","page_number":164,"box":{"x":116,"y":692,"width":746,"height":12}},{"id":"ecdfdd86-539e-4871-83d9-f330626b1f6c","block_type":"box","text":"financial condition of the issuer, the maturity of the obligation and the rating of the issue. The ability of","page_number":164,"box":{"x":116,"y":707,"width":754,"height":12}},{"id":"b122b669-1164-4670-adda-73ee1207beaa","block_type":"box","text":"a Fund to achieve its investment objective is also dependent on the continuing ability of the issuers of","page_number":164,"box":{"x":116,"y":723,"width":753,"height":12}},{"id":"f4ece950-eb8a-4cff-9def-ceda7afc2375","block_type":"box","text":"the securities in which the Fund invests to meet their obligations for the payment of interest and","page_number":164,"box":{"x":116,"y":738,"width":708,"height":12}},{"id":"c9d7f8fb-89b5-4c06-9541-419b91384280","block_type":"box","text":"principal when due. There are variations in the risks involved in holding Municipal Bonds, both within a","page_number":164,"box":{"x":117,"y":754,"width":757,"height":12}},{"id":"74554434-f350-404d-9716-d93259b48c57","block_type":"box","text":"particular classification and between classifications, depending on numerous factors. Furthermore, the","page_number":164,"box":{"x":117,"y":769,"width":758,"height":12}},{"id":"0cd8e141-d646-4a13-a634-c85784db7dff","block_type":"box","text":"rights of owners of Municipal Bonds and the obligations of the issuer of such Municipal Bonds may be","page_number":164,"box":{"x":117,"y":785,"width":753,"height":12}},{"id":"f99e3dc8-df4f-4a3f-8c1e-52b3da3aac88","block_type":"box","text":"subject to applicable bankruptcy, insolvency and similar laws and court decisions affecting the rights of","page_number":164,"box":{"x":116,"y":800,"width":763,"height":12}},{"id":"b84c1048-c8b6-4d0b-b71c-6680f8d68f38","block_type":"box","text":"creditors generally and to general equitable principles, which may limit the enforcement of certain","page_number":164,"box":{"x":116,"y":816,"width":721,"height":12}},{"id":"e7b1768d-cd35-422b-9a01-996fe5e6942a","block_type":"box","text":"remedies.","page_number":164,"box":{"x":117,"y":831,"width":77,"height":10}},{"id":"16d3001a-ed95-44c4-9ab7-51c998d82627","block_type":"box","text":"Variable Rate Demand Obligations (“VRDOs”).","page_number":164,"box":{"x":118,"y":862,"width":344,"height":12}},{"id":"ed09efdf-f297-4545-a212-91823f2ac2c4","block_type":"box","text":"VRDOs are tax-exempt obligations that contain a","page_number":164,"box":{"x":464,"y":862,"width":374,"height":12}},{"id":"56eadf59-e5db-456b-ae2e-3390de0b08b0","block_type":"box","text":"floating or variable interest rate adjustment formula and a right of demand on the part of the holder","page_number":164,"box":{"x":116,"y":878,"width":736,"height":12}},{"id":"5d40042e-3264-45ae-9999-f16451cdc2e2","block_type":"box","text":"II-77","page_number":164,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"2574639f-1073-4813-a61b-8f06b4fe9262","block_type":"box","text":"NM1026U-6004382-164/605","page_number":164,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b180f158-0b64-4dde-97cf-3a933a401186","block_type":"box","text":"thereof to receive payment of the unpaid principal balance plus accrued interest upon a short notice","page_number":165,"box":{"x":116,"y":87,"width":745,"height":12}},{"id":"6d90f84f-824a-4372-bbcd-73edc6ef887a","block_type":"box","text":"period not to exceed seven days.","page_number":165,"box":{"x":117,"y":103,"width":250,"height":12}},{"id":"da963fd4-edf0-4815-8a23-510a03251fae","block_type":"box","text":"There is the possibility that because of default or insolvency the demand feature of VRDOs may not be","page_number":165,"box":{"x":116,"y":134,"width":768,"height":12}},{"id":"b16a88fa-65fa-4de1-84ed-81eebbd5311b","block_type":"box","text":"honored. The interest rates are adjustable at periodic intervals to some prevailing market rate for","page_number":165,"box":{"x":117,"y":149,"width":721,"height":12}},{"id":"27cb71cf-dd64-4eca-9115-238d70e4a6f8","block_type":"box","text":"similar investments, such adjustment formula being calculated to maintain the market rate of the","page_number":165,"box":{"x":116,"y":165,"width":718,"height":12}},{"id":"39b52892-2b11-44f4-9776-34648cc3d5a8","block_type":"box","text":"VRDOs at approximately the par value of the VRDOs on the adjustment date. The adjustments","page_number":165,"box":{"x":116,"y":180,"width":710,"height":12}},{"id":"38ef80df-7f33-4545-a2b0-927785321cae","block_type":"box","text":"typically are based upon the Securities Industry and Financial Markets Association (“SIFMA”) Index.","page_number":165,"box":{"x":116,"y":196,"width":746,"height":12}},{"id":"a7d17a66-3019-4792-9bd4-ee989ddfc475","block_type":"box","text":"Because of the interest rate adjustment formula on VRDOs, VRDOs are not comparable to fixed rate","page_number":165,"box":{"x":117,"y":227,"width":751,"height":12}},{"id":"35eeb476-dc83-414c-9d98-e6c04627df11","block_type":"box","text":"securities. During periods of declining interest rates, a Fund’s yield on a VRDO will decrease and its","page_number":165,"box":{"x":116,"y":242,"width":746,"height":12}},{"id":"11257550-2a2a-4ed1-b951-353d3a60ebf1","block_type":"box","text":"shareholders will forego the opportunity for capital appreciation. During periods of rising interest rates,","page_number":165,"box":{"x":116,"y":258,"width":761,"height":12}},{"id":"86940329-e705-4d53-979a-4221e84ffebf","block_type":"box","text":"however, a Fund’s yield on a VRDO will increase and the Fund’s shareholders will have a reduced risk","page_number":165,"box":{"x":117,"y":273,"width":764,"height":12}},{"id":"588fb75e-ce83-47fa-b5dd-d95a26e67246","block_type":"box","text":"of capital depreciation.","page_number":165,"box":{"x":116,"y":289,"width":173,"height":12}},{"id":"6aebc435-d431-4b75-b468-c02982d50736","block_type":"box","text":"Transactions in Financial Futures Contracts on Municipal Indexes.","page_number":165,"box":{"x":118,"y":320,"width":488,"height":12}},{"id":"0511b82f-6271-49f5-8cfd-66d9b533261c","block_type":"box","text":"The Municipal Funds and certain","page_number":165,"box":{"x":608,"y":320,"width":253,"height":12}},{"id":"13f38c9f-4671-46bd-bc8e-0cb937b3ff32","block_type":"box","text":"other funds deal in financial futures contracts based on a long-term municipal bond index developed by","page_number":165,"box":{"x":116,"y":335,"width":770,"height":12}},{"id":"9e59de34-18fe-4d81-be52-ce758b9a60af","block_type":"box","text":"the Chicago Board of Trade (“CBT”) and The Bond Buyer (the “Municipal Bond Index”). The Municipal","page_number":165,"box":{"x":116,"y":351,"width":761,"height":12}},{"id":"bd1b394b-8a9d-4e9e-9d9c-b70779c0f985","block_type":"box","text":"Bond Index is comprised of 40 long-term, actively traded tax-exempt municipal revenue and general","page_number":165,"box":{"x":117,"y":366,"width":746,"height":12}},{"id":"9244fdab-da06-4bc0-a5ad-c1895954307b","block_type":"box","text":"obligation bonds. Each bond included in the Municipal Bond Index must be rated A or higher by","page_number":165,"box":{"x":116,"y":382,"width":712,"height":12}},{"id":"dea17145-781a-4bde-9384-999ac928a6ff","block_type":"box","text":"Moody’s or S&P and must have a remaining maturity of 19 years or more. Twice a month new issues","page_number":165,"box":{"x":117,"y":397,"width":754,"height":12}},{"id":"6ba16919-08e2-43b6-8d9e-b2833930aa9f","block_type":"box","text":"satisfying the eligibility requirements are added to, and an equal number of old issues are deleted from,","page_number":165,"box":{"x":116,"y":413,"width":771,"height":12}},{"id":"1c5f65da-69fb-4a4a-90ba-4be1ddaaf00c","block_type":"box","text":"the Municipal Bond Index. The value of the Municipal Bond Index is computed daily according to a","page_number":165,"box":{"x":116,"y":428,"width":734,"height":12}},{"id":"1e5c79a1-b7d9-4ce6-b7ee-28b199922674","block_type":"box","text":"formula based on the price of each bond in the Municipal Bond Index, as evaluated by six","page_number":165,"box":{"x":116,"y":444,"width":670,"height":12}},{"id":"60ecf046-52ff-4c03-8d85-177ad1ecae8f","block_type":"box","text":"dealer-to-dealer brokers.","page_number":165,"box":{"x":116,"y":459,"width":189,"height":10}},{"id":"cb7a7773-9576-43a4-a690-9971af66e4db","block_type":"box","text":"The Municipal Bond Index futures contract is traded only on the CBT. Like other contract markets, the","page_number":165,"box":{"x":116,"y":490,"width":760,"height":12}},{"id":"5fdec5f9-e08f-4ef7-9764-6b16740e5baa","block_type":"box","text":"CBT assures performance under futures contracts through a clearing corporation, a nonprofit","page_number":165,"box":{"x":117,"y":506,"width":694,"height":12}},{"id":"d1d83466-8810-4b2d-bb67-e756ae53ff6e","block_type":"box","text":"organization managed by the exchange membership that is also responsible for handling daily","page_number":165,"box":{"x":116,"y":521,"width":704,"height":12}},{"id":"dab0e915-5741-4a3f-9b8a-0f61afd0f0f7","block_type":"box","text":"accounting of deposits or withdrawals of margin.","page_number":165,"box":{"x":116,"y":537,"width":364,"height":12}},{"id":"8f759fad-ce59-4f3a-bb7b-d3079a0dcd35","block_type":"box","text":"The particular municipal bonds comprising the index underlying the Municipal Bond Index financial","page_number":165,"box":{"x":116,"y":568,"width":735,"height":12}},{"id":"6a1a194e-c617-4e07-b794-0944c0bec2e3","block_type":"box","text":"futures contract may vary from the bonds held by a Municipal Fund. As a result, a Municipal Fund’s","page_number":165,"box":{"x":116,"y":583,"width":741,"height":12}},{"id":"5061d3f0-cde8-48ce-b1e3-e4d5df135293","block_type":"box","text":"ability to hedge effectively all or a portion of the value of its Municipal Bonds through the use of such","page_number":165,"box":{"x":116,"y":599,"width":749,"height":12}},{"id":"27a87106-3511-45d2-99e9-7e0b3b7fce1c","block_type":"box","text":"financial futures contracts will depend in part on the degree to which price movements in the index","page_number":165,"box":{"x":116,"y":614,"width":734,"height":12}},{"id":"c011711b-69f4-4455-a649-a9b5b5b4d99b","block_type":"box","text":"underlying the financial futures contract correlate with the price movements of the Municipal Bonds","page_number":165,"box":{"x":117,"y":630,"width":737,"height":12}},{"id":"30e76065-90f1-48af-a5d2-7ad2b654392c","block_type":"box","text":"held by the Fund. The correlation may be affected by disparities in the average maturity, ratings,","page_number":165,"box":{"x":117,"y":645,"width":718,"height":12}},{"id":"b6dcfe61-5334-4c03-ab39-152ab316f01d","block_type":"box","text":"geographical mix or structure of a Municipal Fund’s investments as compared to those comprising the","page_number":165,"box":{"x":116,"y":661,"width":755,"height":12}},{"id":"df45c401-42e8-4780-a6f8-024d312c9e81","block_type":"box","text":"Municipal Bond Index and general economic or political factors. In addition, the correlation between","page_number":165,"box":{"x":117,"y":676,"width":736,"height":12}},{"id":"588c5887-142b-4d6b-9b76-aa9e3603c59f","block_type":"box","text":"movements in the value of the Municipal Bond Index may be subject to change over time as additions","page_number":165,"box":{"x":117,"y":692,"width":753,"height":12}},{"id":"5e1a4206-7a5a-485d-bf03-52a78024c610","block_type":"box","text":"to and deletions from the Municipal Bond Index alter its structure. The correlation between futures","page_number":165,"box":{"x":116,"y":707,"width":725,"height":12}},{"id":"5bce742f-8c40-48df-b8d6-a8e30a930bec","block_type":"box","text":"contracts on U.S. Government Securities and the Municipal Bonds held by a Municipal Fund may be","page_number":165,"box":{"x":116,"y":723,"width":745,"height":12}},{"id":"bd0fe6ef-ffc2-41d0-924b-ab89f12f2f92","block_type":"box","text":"adversely affected by similar factors and the risk of imperfect correlation between movements in the","page_number":165,"box":{"x":116,"y":738,"width":740,"height":12}},{"id":"5966476f-c0ff-43f7-92b2-0c0612675fef","block_type":"box","text":"prices of such futures contracts and the prices of Municipal Bonds held by a Municipal Fund may be","page_number":165,"box":{"x":117,"y":754,"width":740,"height":12}},{"id":"075f5da5-bc56-4e05-b4fd-f78c8891bea0","block_type":"box","text":"greater. Municipal Bond Index futures contracts were approved for trading in 1985. Trading in such","page_number":165,"box":{"x":116,"y":769,"width":732,"height":12}},{"id":"2a492b13-a1d4-4ed7-bafe-bd8539a17213","block_type":"box","text":"futures contracts may tend to be less liquid than trading in other futures contracts. The trading of","page_number":165,"box":{"x":116,"y":785,"width":716,"height":12}},{"id":"6d59fb31-9657-4b9f-b0d2-a5c5db64fb86","block_type":"box","text":"futures contracts also is subject to certain market risks, such as inadequate trading activity, which","page_number":165,"box":{"x":116,"y":800,"width":723,"height":12}},{"id":"b53f92b3-2f1d-46e4-930b-735acf94bb33","block_type":"box","text":"could at times make it difficult or impossible to liquidate existing positions.","page_number":165,"box":{"x":116,"y":816,"width":545,"height":12}},{"id":"fb363588-c804-470d-9e63-2ee2d72b2732","block_type":"box","text":"Call Rights.","page_number":165,"box":{"x":117,"y":847,"width":83,"height":12}},{"id":"d2d4de67-1a32-4ace-bffc-0b9fbd27ac77","block_type":"box","text":"A Fund may purchase a Municipal Bond issuer’s right to call all or a portion of such","page_number":165,"box":{"x":202,"y":847,"width":626,"height":12}},{"id":"14c4614f-6990-445a-89e3-a5aaeda6e4d9","block_type":"box","text":"Municipal Bond for mandatory tender for purchase (a “Call Right”). A holder of a Call Right may","page_number":165,"box":{"x":117,"y":862,"width":711,"height":12}},{"id":"ed697b2c-1dd0-4c23-8c89-32403d4245e5","block_type":"box","text":"exercise such right to require a mandatory tender for the purchase of related Municipal Bonds, subject","page_number":165,"box":{"x":116,"y":878,"width":763,"height":12}},{"id":"cf697ec1-2b5b-426c-abe0-7a4f218d2e1d","block_type":"box","text":"II-78","page_number":165,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"f84ec2d7-5214-4112-94bb-1047d623f044","block_type":"box","text":"NM1026U-6004382-165/605","page_number":165,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9156ecad-3c78-4747-a01c-9203a76fbf97","block_type":"box","text":"to certain conditions. A Call Right that is not exercised prior to maturity of the related Municipal Bond","page_number":166,"box":{"x":116,"y":87,"width":751,"height":12}},{"id":"e57e9147-45c5-414d-af30-3fb09121b6cd","block_type":"box","text":"will expire without value. The economic effect of holding both the Call Right and the related Municipal","page_number":166,"box":{"x":116,"y":102,"width":756,"height":13}},{"id":"d794e9e9-c058-4c49-a453-fb8f4c975ad5","block_type":"box","text":"Bond is identical to holding a Municipal Bond as a non-callable security. Certain investments in such","page_number":166,"box":{"x":117,"y":118,"width":748,"height":12}},{"id":"067be448-0f76-4044-a27b-f0392c1938a8","block_type":"box","text":"obligations may be illiquid.","page_number":166,"box":{"x":116,"y":134,"width":201,"height":12}},{"id":"5e8cc0fa-d3ba-423b-abb0-5bcc8e09740a","block_type":"box","text":"Municipal Interest Rate Swap Transactions.","page_number":166,"box":{"x":116,"y":165,"width":323,"height":11}},{"id":"cb949421-16f9-4e30-b093-1fac32b96ab6","block_type":"box","text":"In order to hedge the value of a Fund against interest rate","page_number":166,"box":{"x":440,"y":165,"width":439,"height":12}},{"id":"e8594cee-08be-4a76-9765-cb6a99875bce","block_type":"box","text":"fluctuations or to enhance a Fund’s income, a Fund may enter into interest rate swap transactions such","page_number":166,"box":{"x":116,"y":180,"width":772,"height":12}},{"id":"891ac534-5ce2-47fa-8b41-1fc6c6f97e02","block_type":"box","text":"as Municipal Market Data AAA Cash Curve swaps (“MMD Swaps”) or Securities Industry and Financial","page_number":166,"box":{"x":116,"y":196,"width":769,"height":12}},{"id":"51793252-61ec-43f9-8a3c-733471411f3d","block_type":"box","text":"Markets Association Municipal Swap Index swaps (“SIFMA Swaps”). To the extent that a Fund enters","page_number":166,"box":{"x":117,"y":211,"width":758,"height":12}},{"id":"2c4a10b7-2914-4ccc-9131-87b43eee9afe","block_type":"box","text":"into these transactions, the Fund expects to do so primarily to preserve a return or spread on a","page_number":166,"box":{"x":117,"y":227,"width":708,"height":12}},{"id":"f1425ad7-a80e-4d4b-b5b3-e02d8d0c9eb4","block_type":"box","text":"particular investment or portion of its portfolio or to protect against any increase in the price of","page_number":166,"box":{"x":117,"y":242,"width":699,"height":12}},{"id":"5b1a1ccf-15d3-4609-8c30-84284948fcdb","block_type":"box","text":"securities the Fund anticipates purchasing at a later date. A Fund intends to use these transactions","page_number":166,"box":{"x":116,"y":258,"width":741,"height":12}},{"id":"b2955720-321a-4ceb-94b8-32ea2515e9e5","block_type":"box","text":"primarily as a hedge rather than as a speculative investment. However, a Fund also may invest in","page_number":166,"box":{"x":117,"y":273,"width":729,"height":12}},{"id":"5f1c364a-cfb7-4096-aeab-8dd16db3c44c","block_type":"box","text":"MMD Swaps and SIFMA Swaps to enhance income or gain or to increase the Fund’s yield, for","page_number":166,"box":{"x":117,"y":289,"width":704,"height":12}},{"id":"0a0c37a9-82d2-4521-9150-db723e588bba","block_type":"box","text":"example, during periods of steep interest rate yield curves (","page_number":166,"box":{"x":116,"y":304,"width":441,"height":12}},{"id":"7f57f48a-3c6f-4109-82c6-f34a2cd3c32d","block_type":"box","text":"i.e.","page_number":166,"box":{"x":558,"y":304,"width":20,"height":10}},{"id":"7d6d43ee-a456-4ca2-8583-a39d42566b8f","block_type":"box","text":", wide differences between short-term","page_number":166,"box":{"x":581,"y":304,"width":284,"height":11}},{"id":"67dde0f4-87b4-4506-a375-7a43257059df","block_type":"box","text":"and long-term interest rates).","page_number":166,"box":{"x":116,"y":320,"width":221,"height":12}},{"id":"5c20bf8a-7930-4798-b974-fe56b0c8f3db","block_type":"box","text":"A Fund may purchase and sell SIFMA Swaps in the SIFMA swap market. In a SIFMA Swap, a Fund","page_number":166,"box":{"x":116,"y":351,"width":747,"height":12}},{"id":"5ec1ff50-4144-4660-9e78-46584b8fbda9","block_type":"box","text":"exchanges with another party their respective commitments to pay or receive interest (","page_number":166,"box":{"x":116,"y":366,"width":642,"height":12}},{"id":"8c73f6ca-80bf-4d7e-9460-0432a8e94cc7","block_type":"box","text":"e.g.","page_number":166,"box":{"x":760,"y":369,"width":25,"height":9}},{"id":"c65cbc69-5c91-48f8-b9a9-5acd8eb7777a","block_type":"box","text":", an","page_number":166,"box":{"x":788,"y":369,"width":32,"height":8}},{"id":"f207a9dd-a9a1-4c8f-848c-ae5a185fd883","block_type":"box","text":"exchange of fixed rate payments for floating rate payments linked to the SIFMA Municipal Swap","page_number":166,"box":{"x":116,"y":382,"width":717,"height":12}},{"id":"a732357b-099e-4da9-b938-51f7a566235d","block_type":"box","text":"Index). Because the underlying index is a tax-exempt index, SIFMA Swaps may reduce cross-market","page_number":166,"box":{"x":117,"y":397,"width":755,"height":12}},{"id":"f531c797-6560-4e3c-bbbd-2d776081bb0e","block_type":"box","text":"risks incurred by a Fund and increase a Fund’s ability to hedge effectively. SIFMA Swaps are typically","page_number":166,"box":{"x":117,"y":413,"width":760,"height":12}},{"id":"a29e4534-48e3-41a2-852a-890db94091e6","block_type":"box","text":"quoted for the entire yield curve, beginning with a seven day floating rate index out to 30 years. The","page_number":166,"box":{"x":116,"y":428,"width":745,"height":12}},{"id":"e2dcefbd-6da3-458c-868a-073de70d1268","block_type":"box","text":"duration of a SIFMA Swap is approximately equal to the duration of a fixed-rate Municipal Bond with","page_number":166,"box":{"x":116,"y":444,"width":747,"height":12}},{"id":"e60f5623-4bf0-4741-9124-d3a39aca7289","block_type":"box","text":"the same attributes as the swap (","page_number":166,"box":{"x":116,"y":459,"width":247,"height":12}},{"id":"164b7cb9-b438-4ffb-8ac6-9dcf5bac782c","block_type":"box","text":"e.g.","page_number":166,"box":{"x":365,"y":462,"width":25,"height":9}},{"id":"c185b667-69be-4135-a91f-96a936f98c09","block_type":"box","text":", coupon, maturity, call feature).","page_number":166,"box":{"x":393,"y":459,"width":240,"height":12}},{"id":"05c0252d-cacd-4aaa-9752-bffbe5c6ecff","block_type":"box","text":"A Fund may also purchase and sell MMD Swaps, also known as MMD rate locks. An MMD Swap","page_number":166,"box":{"x":116,"y":490,"width":727,"height":12}},{"id":"f0dd54b5-4c4f-44e4-925d-1080d26f34a0","block_type":"box","text":"permits a Fund to lock in a specified municipal interest rate for a portion of its portfolio to preserve a","page_number":166,"box":{"x":117,"y":506,"width":744,"height":12}},{"id":"ef283662-7442-42ac-b172-967b02b63199","block_type":"box","text":"return on a particular investment or a portion of its portfolio as a duration management technique or to","page_number":166,"box":{"x":117,"y":521,"width":761,"height":12}},{"id":"309314e3-09f5-4b03-a331-7a3f4fd1ad98","block_type":"box","text":"protect against any increase in the price of securities to be purchased at a later date. By using an MMD","page_number":166,"box":{"x":117,"y":537,"width":771,"height":12}},{"id":"bc701844-9b8d-4c6f-9f1b-7fd96c7568bf","block_type":"box","text":"Swap, a Fund can create a synthetic long or short position, allowing the Fund to select the most","page_number":166,"box":{"x":116,"y":552,"width":715,"height":12}},{"id":"1ca35c33-40af-4f12-8e2a-b2b703120f81","block_type":"box","text":"attractive part of the yield curve. An MMD Swap is a contract between a Fund and an MMD Swap","page_number":166,"box":{"x":116,"y":568,"width":729,"height":12}},{"id":"b97754b8-194a-4556-bd99-79e49b7afe4e","block_type":"box","text":"provider pursuant to which the parties agree to make payments to each other on a notional amount,","page_number":166,"box":{"x":117,"y":583,"width":744,"height":12}},{"id":"c785247e-292d-4558-b16f-13d43cf95cf0","block_type":"box","text":"contingent upon whether the Municipal Market Data AAA General Obligation Scale is above or below a","page_number":166,"box":{"x":116,"y":599,"width":769,"height":12}},{"id":"40bc4060-6a3a-44f1-8035-b59d82a26d30","block_type":"box","text":"specified level on the expiration date of the contract. For example, if a Fund buys an MMD Swap and","page_number":166,"box":{"x":116,"y":614,"width":754,"height":12}},{"id":"279f72b0-57a8-4fc0-861a-05a09f60ec28","block_type":"box","text":"the Municipal Market Data AAA General Obligation Scale is below the specified level on the expiration","page_number":166,"box":{"x":116,"y":630,"width":763,"height":12}},{"id":"ea2515fc-a8fa-44ee-9b2c-5008ee7542ea","block_type":"box","text":"date, the counterparty to the contract will make a payment to the Fund equal to the specified level","page_number":166,"box":{"x":116,"y":645,"width":730,"height":12}},{"id":"f3860f33-6aec-485c-9304-fd8d783b32dc","block_type":"box","text":"minus the actual level, multiplied by the notional amount of the contract. If the Municipal Market Data","page_number":166,"box":{"x":117,"y":661,"width":746,"height":12}},{"id":"fb15e2a6-d455-4353-bb3b-652c26315960","block_type":"box","text":"AAA General Obligation Scale is above the specified level on the expiration date, a Fund will make a","page_number":166,"box":{"x":116,"y":676,"width":746,"height":12}},{"id":"7f51771c-8788-4b8a-bb1f-3b9b0b8f4831","block_type":"box","text":"payment to the counterparty equal to the actual level minus the specified level, multiplied by the","page_number":166,"box":{"x":117,"y":692,"width":708,"height":12}},{"id":"9ffaab36-91c3-40fb-bcaa-f9b399ac41cb","block_type":"box","text":"notional amount of the contract.","page_number":166,"box":{"x":117,"y":707,"width":233,"height":10}},{"id":"8799c99e-2623-4482-9999-866e8f6e400b","block_type":"box","text":"In connection with investments in SIFMA and MMD Swaps,","page_number":166,"box":{"x":117,"y":738,"width":438,"height":12}},{"id":"799bb186-5018-4ffc-8204-de8c670bf0e6","block_type":"box","text":"there is a risk that municipal yields will","page_number":166,"box":{"x":561,"y":738,"width":283,"height":12}},{"id":"76791dfd-36dd-4c79-8457-c69ec421d7ac","block_type":"box","text":"move in the opposite direction than anticipated by a Fund, which would cause the Fund to make","page_number":166,"box":{"x":117,"y":754,"width":711,"height":12}},{"id":"df5e7f12-2644-4f9f-97ea-f8e719f1faa8","block_type":"box","text":"payments to its counterparty in the transaction that could adversely affect the Fund’s performance.","page_number":166,"box":{"x":117,"y":769,"width":729,"height":12}},{"id":"f43eb935-d67b-46e8-a4ca-46edc664be0e","block_type":"box","text":"Insured Municipal Bonds.","page_number":166,"box":{"x":117,"y":800,"width":186,"height":12}},{"id":"145e013d-52fe-4346-a5de-ace93d09e68a","block_type":"box","text":"Bonds purchased by a Fund may be covered by insurance that guarantees","page_number":166,"box":{"x":310,"y":800,"width":555,"height":12}},{"id":"b528517b-340d-47fd-b419-1652b4920307","block_type":"box","text":"that interest payments on the bond will be made on time and the principal will be repaid when the bond","page_number":166,"box":{"x":116,"y":816,"width":762,"height":12}},{"id":"6420a2f4-9bf1-4f31-87f5-d374e9bd8d8b","block_type":"box","text":"matures. Either the issuer of the bond or the Fund purchases the insurance. Insurance is expected to","page_number":166,"box":{"x":117,"y":831,"width":755,"height":12}},{"id":"96768078-3620-4873-9c64-ccf5e237b03c","block_type":"box","text":"protect the Fund against losses caused by a bond issuer’s failure to make interest or principal","page_number":166,"box":{"x":117,"y":847,"width":699,"height":12}},{"id":"72b8a795-efae-4719-bd50-5f12cf02db41","block_type":"box","text":"payments. However, insurance does not protect the Fund or its shareholders against losses caused by","page_number":166,"box":{"x":117,"y":862,"width":767,"height":12}},{"id":"a27dd0d9-c74f-415c-b8ac-55d5335cd98d","block_type":"box","text":"declines in a bond’s market value. Also, the Fund cannot be certain that any insurance company does","page_number":166,"box":{"x":116,"y":878,"width":761,"height":12}},{"id":"47d9ad31-eeae-461b-82ca-461e8ac6b106","block_type":"box","text":"II-79","page_number":166,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"1e14191d-db1c-46b3-90c1-1e7ab3b91251","block_type":"box","text":"NM1026U-6004382-166/605","page_number":166,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4eca8b49-c304-42b8-9379-6104e06b5df6","block_type":"box","text":"not make these payments. In addition, if the Fund purchases the insurance, it may pay the premiums,","page_number":167,"box":{"x":117,"y":87,"width":758,"height":12}},{"id":"e73ecc9b-a555-4695-b170-578d7595f8c4","block_type":"box","text":"which will reduce the Fund’s yield. The Fund seeks to use only insurance companies with claims","page_number":167,"box":{"x":116,"y":103,"width":721,"height":12}},{"id":"13a42c65-1833-440d-85bc-e5ca337924af","block_type":"box","text":"paying ability, financial strength, or equivalent ratings of at least investment grade. However, if","page_number":167,"box":{"x":117,"y":118,"width":703,"height":12}},{"id":"d4f8f55c-30cf-4501-8dc0-be7a7f05e7ea","block_type":"box","text":"insurance from insurers with these ratings is not available, the Fund may use insurance companies","page_number":167,"box":{"x":117,"y":134,"width":739,"height":12}},{"id":"1984688b-0f09-42f9-b7a0-fc1967934e99","block_type":"box","text":"with lower ratings or stop purchasing insurance or insured bonds. If a bond’s insurer fails to fulfill its","page_number":167,"box":{"x":116,"y":149,"width":742,"height":12}},{"id":"6ab0fe52-fb0c-415a-817c-090b30840c9b","block_type":"box","text":"obligations or loses its credit rating, the value of the bond could drop.","page_number":167,"box":{"x":116,"y":165,"width":517,"height":12}},{"id":"027aa2e7-c4bc-4219-8fcd-43fffbc56eb8","block_type":"box","text":"Build America Bonds.","page_number":167,"box":{"x":116,"y":196,"width":159,"height":9}},{"id":"63e68bfa-f66c-41d2-a58a-cbefbbea41b6","block_type":"box","text":"If a Fund holds Build America Bonds, the Fund may be eligible to receive a U.S.","page_number":167,"box":{"x":276,"y":196,"width":604,"height":12}},{"id":"e21cba73-dfea-4222-a438-624d857d0918","block_type":"box","text":"federal income tax credit; however, the issuer of a Build America Bond may instead elect to receive a","page_number":167,"box":{"x":116,"y":211,"width":756,"height":12}},{"id":"5fedd40b-f361-4891-bb42-f0a423990857","block_type":"box","text":"cash payment directly from the federal government in lieu of holders such as the fund receiving a tax","page_number":167,"box":{"x":116,"y":227,"width":752,"height":12}},{"id":"aa6950f8-084f-4509-b315-54976c6a2347","block_type":"box","text":"credit. The interest on Build America Bonds is taxable for U.S. federal income tax purposes. If the Fund","page_number":167,"box":{"x":116,"y":242,"width":772,"height":12}},{"id":"68bf8a37-1737-4063-aae4-3343817192ab","block_type":"box","text":"does receive tax credits from Build America Bonds or other tax credit bonds on one or more specified","page_number":167,"box":{"x":116,"y":258,"width":757,"height":11}},{"id":"344a665a-100a-4b2f-923d-0b642d4e4454","block_type":"box","text":"dates during the fund’s taxable year, and the Fund satisfies the minimum distribution requirement, the","page_number":167,"box":{"x":116,"y":273,"width":760,"height":12}},{"id":"0a7cd1ed-c3ac-4d8e-9de0-c03d451c86af","block_type":"box","text":"Fund may elect for U.S. federal income tax purposes to pass through to shareholders tax credits","page_number":167,"box":{"x":117,"y":289,"width":719,"height":12}},{"id":"3c0b30fc-aae4-4030-8422-4e77cfffa7da","block_type":"box","text":"otherwise allowable to the Fund for that year with respect to such bonds. A tax credit bond is defined in","page_number":167,"box":{"x":116,"y":304,"width":770,"height":12}},{"id":"c33cc7c4-4bbb-4886-a084-9a8c6057b00c","block_type":"box","text":"the Code as a “qualified tax credit bond” (which includes a qualified forestry conservation bond, a new","page_number":167,"box":{"x":116,"y":320,"width":761,"height":12}},{"id":"6ed4c0d2-42c3-4482-b7c3-df1e99101c4e","block_type":"box","text":"clean renewable energy bond, a qualified energy conservation bond, or a qualified zone academy","page_number":167,"box":{"x":116,"y":335,"width":729,"height":12}},{"id":"652c2dc0-556a-4548-9719-25fef99031d4","block_type":"box","text":"bond, each of which must meet certain requirements specified in the Code), a “Build America Bond”","page_number":167,"box":{"x":117,"y":351,"width":744,"height":12}},{"id":"7c835c46-022c-4ab5-a482-11a10ebe438b","block_type":"box","text":"(which includes certain qualified bonds issued before January 1, 2011) or certain other specified","page_number":167,"box":{"x":117,"y":366,"width":717,"height":12}},{"id":"f35e65ca-e4fe-4d4e-bad5-10f026ae75b6","block_type":"box","text":"bonds. If the Fund were to so elect, a shareholder would be required to include in income and would be","page_number":167,"box":{"x":117,"y":382,"width":771,"height":12}},{"id":"b2930486-def7-46c5-be1b-70cb9eef30af","block_type":"box","text":"entitled to claim as a tax credit an amount equal to a proportionate share of such credits, and such","page_number":167,"box":{"x":116,"y":397,"width":735,"height":12}},{"id":"1a2862fa-708c-4531-859e-9522925e9644","block_type":"box","text":"amount would be subject to withholding provisions of the Code. Certain limitations may apply on the","page_number":167,"box":{"x":116,"y":413,"width":746,"height":12}},{"id":"a04399a7-1daa-4e67-b443-78066dc841ad","block_type":"box","text":"extent to which the credit may be claimed.","page_number":167,"box":{"x":116,"y":428,"width":318,"height":12}},{"id":"43448b8e-1441-4dfe-9c21-01ea5280e34a","block_type":"box","text":"Tax-Exempt Municipal Investments.","page_number":167,"box":{"x":118,"y":459,"width":263,"height":12}},{"id":"ee63cafd-8dde-4e1a-9c61-b748486b987d","block_type":"box","text":"Certain Funds may hold tax-exempt municipal investments which","page_number":167,"box":{"x":382,"y":459,"width":494,"height":12}},{"id":"8b28903e-245e-4120-b044-4cc84c536c70","block_type":"box","text":"may be in the form of tender option bonds, variable rate demand obligations, participations, beneficial","page_number":167,"box":{"x":117,"y":475,"width":757,"height":12}},{"id":"b35125cf-922d-46f6-8598-a8111bad7ea1","block_type":"box","text":"interests in a trust, partnership interests or other forms. These investments are described in greater","page_number":167,"box":{"x":117,"y":490,"width":741,"height":12}},{"id":"9544a4e3-44b7-43d8-bb81-59c82ceadf1c","block_type":"box","text":"detail above in this section. Some of the structures used by certain Funds include interests in long-term","page_number":167,"box":{"x":116,"y":506,"width":771,"height":12}},{"id":"13ee0c8e-01ff-465f-b469-96adbdf0a2a6","block_type":"box","text":"fixed-rate municipal debt obligations, held by a trustee or custodian, that are coupled with tender","page_number":167,"box":{"x":116,"y":521,"width":720,"height":12}},{"id":"0b3cdb7e-5ef7-4d81-9ebf-2988c8267826","block_type":"box","text":"option, demand and other features when the tax-exempt municipal investments are created. Together,","page_number":167,"box":{"x":116,"y":537,"width":764,"height":12}},{"id":"9d531cab-8eb8-4ec0-9809-514bfbd7835e","block_type":"box","text":"these features entitle the holder of the interest to tender (or put) the underlying municipal debt","page_number":167,"box":{"x":116,"y":552,"width":701,"height":12}},{"id":"225ef750-3334-44fc-a75a-b3202e9915d6","block_type":"box","text":"obligation to a third party at periodic intervals and to receive the principal amount thereof.","page_number":167,"box":{"x":116,"y":568,"width":667,"height":12}},{"id":"3ebb7bf7-8ebc-401a-87ba-4fd7ba182d84","block_type":"box","text":"In some cases, municipal debt obligations are represented by custodial receipts evidencing rights to","page_number":167,"box":{"x":117,"y":599,"width":745,"height":12}},{"id":"da37a3b5-d832-4ce0-a114-769d4e7dffa4","block_type":"box","text":"receive specific future interest payments, principal payments, or both, on the underlying securities held","page_number":167,"box":{"x":117,"y":614,"width":766,"height":12}},{"id":"5c82b1db-4c96-45f6-807b-d44aac8bcf60","block_type":"box","text":"by the custodian. Under such arrangements, the holder of the custodial receipt has the option to tender","page_number":167,"box":{"x":117,"y":630,"width":769,"height":12}},{"id":"c66c2e2c-2036-4b1c-89af-f8a0069ca4fd","block_type":"box","text":"the underlying securities at their face value to the sponsor (","page_number":167,"box":{"x":116,"y":645,"width":440,"height":12}},{"id":"81f9a307-f7c6-44aa-a95a-964501623b85","block_type":"box","text":"e.g.","page_number":167,"box":{"x":557,"y":648,"width":26,"height":9}},{"id":"7c56c8e2-df85-4389-9bf4-4bc4352c9a39","block_type":"box","text":", a Fund, or a bank or broker-dealer or","page_number":167,"box":{"x":586,"y":645,"width":289,"height":11}},{"id":"e5a83226-341a-4363-9829-56d6ae66852b","block_type":"box","text":"other financial institution), which is paid periodic fees equal to the difference between the securities’","page_number":167,"box":{"x":116,"y":661,"width":738,"height":12}},{"id":"14e61c0b-be8c-4e63-bc9b-3029e411d345","block_type":"box","text":"fixed coupon rate and the rate that would cause the securities, coupled with the tender option, to trade","page_number":167,"box":{"x":116,"y":676,"width":758,"height":12}},{"id":"3a4eccf2-18e5-462e-8463-653e10346509","block_type":"box","text":"at par on the date of a rate adjustment.","page_number":167,"box":{"x":116,"y":692,"width":289,"height":12}},{"id":"c3975eff-6e41-4bfe-8c7b-31fa9e774f53","block_type":"box","text":"A participation interest gives the Fund an undivided interest in a Municipal Bond in the proportion the","page_number":167,"box":{"x":116,"y":723,"width":747,"height":12}},{"id":"b62c3399-c910-4c0f-bba3-8b80a4a96191","block_type":"box","text":"Fund’s participation bears to the total principal amount of the Municipal Bond, and typically provides for","page_number":167,"box":{"x":117,"y":738,"width":764,"height":12}},{"id":"92908a71-28bc-43c1-ace2-9343cc3214ee","block_type":"box","text":"a repurchase feature for all or any part of the full principal amount of the participation interest, plus","page_number":167,"box":{"x":116,"y":754,"width":729,"height":12}},{"id":"d5200662-4b5d-4f5d-ac22-2a160470bbfe","block_type":"box","text":"accrued interest. Trusts and partnerships are typically used to convert long-term fixed rate high quality","page_number":167,"box":{"x":116,"y":769,"width":759,"height":12}},{"id":"19b250d2-1efa-4bf5-aaa3-86d3595d7aed","block_type":"box","text":"bonds of a single state or municipal issuer into variable or floating rate demand instruments.","page_number":167,"box":{"x":117,"y":785,"width":680,"height":12}},{"id":"1d55128a-5d7c-4420-bb1b-1ddc2dad7813","block_type":"box","text":"The Municipal Bond Funds may hold participation interests and custodial receipts for municipal debt","page_number":167,"box":{"x":116,"y":816,"width":741,"height":12}},{"id":"a2e150b0-7366-4d1e-920d-a898415edfef","block_type":"box","text":"obligations which give the holder the right to receive payment of principal subject to the conditions","page_number":167,"box":{"x":116,"y":831,"width":731,"height":12}},{"id":"c052df27-22f7-43ee-b6da-7108d4651361","block_type":"box","text":"described above. The IRS has not ruled on whether the interest received on tax-exempt municipal","page_number":167,"box":{"x":116,"y":847,"width":732,"height":12}},{"id":"66e9a473-1292-4c75-918e-6e55dc5b4a8f","block_type":"box","text":"investments in the form of participation interests or custodial receipts is tax-exempt, and accordingly,","page_number":167,"box":{"x":117,"y":862,"width":751,"height":12}},{"id":"7296aace-2bcb-4f93-b193-47423ab5c57f","block_type":"box","text":"purchases of any such interests or receipts are based on the opinions of counsel to the sponsors of","page_number":167,"box":{"x":117,"y":878,"width":742,"height":12}},{"id":"adbf2571-4674-4819-8cf3-1b8d9ecee67c","block_type":"box","text":"II-80","page_number":167,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"dc105b02-48e1-44d3-b8e6-1b42bdca639b","block_type":"box","text":"NM1026U-6004382-167/605","page_number":167,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6f572981-b565-4c24-816f-6c74354d472a","block_type":"box","text":"such derivative securities. Neither a Fund nor its investment adviser or sub-advisers will review the","page_number":168,"box":{"x":116,"y":87,"width":738,"height":10}},{"id":"77351cb9-532d-421e-add5-e5e8d215911e","block_type":"box","text":"proceedings related to the creation of any tax-exempt municipal investments or the basis for such","page_number":168,"box":{"x":117,"y":102,"width":728,"height":13}},{"id":"f520244e-9e7a-411b-a2f5-159e9bcfb3ae","block_type":"box","text":"opinions.","page_number":168,"box":{"x":116,"y":118,"width":72,"height":12}},{"id":"20e19da5-2263-478e-95e0-9dc077be95c3","block_type":"box","text":"Operational and Technology Risks.","page_number":168,"box":{"x":117,"y":146,"width":279,"height":12}},{"id":"00dd1e51-72c4-493d-9cb9-e25dc2384397","block_type":"box","text":"The Fund and the entities with which it interacts directly or","page_number":168,"box":{"x":397,"y":146,"width":442,"height":12}},{"id":"50be05fe-3c4c-4172-abc6-e493ba23aab7","block_type":"box","text":"indirectly are susceptible to operational and technology risks, including those related to human errors,","page_number":168,"box":{"x":117,"y":162,"width":758,"height":12}},{"id":"77ca8648-f38e-44c2-8f22-ce8d930c1dc1","block_type":"box","text":"processing errors, communication errors, systems failures, cybersecurity incidents, and the use of","page_number":168,"box":{"x":117,"y":177,"width":731,"height":12}},{"id":"8043d69d-7a07-49ad-9152-02df2452536f","block_type":"box","text":"artificial intelligence and machine learning (“AI”), which may result in losses for the Fund and its","page_number":168,"box":{"x":116,"y":192,"width":713,"height":13}},{"id":"f2809685-9719-443a-93dd-f892438a494b","block_type":"box","text":"shareholders or impair the Fund’s operations. These entities include, but are not limited to, the Fund’s","page_number":168,"box":{"x":116,"y":208,"width":760,"height":12}},{"id":"185e6160-4051-484a-9719-2cda5992c3bb","block_type":"box","text":"adviser, administrator, distributor, other service providers (e.g., index and benchmark providers,","page_number":168,"box":{"x":116,"y":223,"width":716,"height":13}},{"id":"1c289e63-19f8-466d-ba96-f5feba951aae","block_type":"box","text":"accountants, custodians, and transfer agents), financial intermediaries, counterparties, market makers,","page_number":168,"box":{"x":116,"y":239,"width":768,"height":12}},{"id":"1117845d-2c1f-403b-b0e5-5af906eb4f1d","block_type":"box","text":"Authorized Participants, listing exchanges, other financial market operators, and governmental","page_number":168,"box":{"x":116,"y":254,"width":706,"height":13}},{"id":"3ff78606-65db-474c-a683-00f8a3ed6bd3","block_type":"box","text":"authorities, as applicable. Operational and technology risks for the issuers in which the Fund invests","page_number":168,"box":{"x":116,"y":270,"width":748,"height":12}},{"id":"192d8e19-fac2-42fb-9165-b78a1b14439f","block_type":"box","text":"could also result in material adverse consequences for such issuers and may cause the Fund’s","page_number":168,"box":{"x":116,"y":285,"width":711,"height":13}},{"id":"1cafc861-2550-414c-8f4c-893fa5250db3","block_type":"box","text":"investments in such issuers to lose value. The Fund may incur substantial costs in order to mitigate","page_number":168,"box":{"x":117,"y":301,"width":741,"height":12}},{"id":"06a7d601-1ab8-4867-bd70-473b5724221b","block_type":"box","text":"operational and technology risks.","page_number":168,"box":{"x":116,"y":317,"width":250,"height":12}},{"id":"b4acd990-1259-4df4-b8a2-541c39070e85","block_type":"box","text":"Cybersecurity incidents can result from deliberate attacks or unintentional events against an issuer in","page_number":168,"box":{"x":117,"y":344,"width":754,"height":12}},{"id":"4e2e26b3-a78c-4a74-8735-950c867d4594","block_type":"box","text":"which the Fund invests, the Fund or any of its service providers. They include, but are not limited to,","page_number":168,"box":{"x":116,"y":360,"width":746,"height":12}},{"id":"c393997d-b6e8-44b3-a9bc-8bacd8437a40","block_type":"box","text":"gaining unauthorized access to systems, misappropriating assets or sensitive information, corrupting or","page_number":168,"box":{"x":116,"y":375,"width":772,"height":12}},{"id":"b84f5b3c-b328-4946-8d4f-4bd882a14609","block_type":"box","text":"destroying data, and causing operational disruption. Geopolitical tension may increase the scale and","page_number":168,"box":{"x":116,"y":391,"width":751,"height":12}},{"id":"dbb3621d-f4fd-4049-b838-07a71670550a","block_type":"box","text":"sophistication of deliberate attacks, particularly those from nation states or from entities with nation","page_number":168,"box":{"x":116,"y":406,"width":738,"height":12}},{"id":"cf7b5e8c-06d8-4683-9639-52839b43dbb6","block_type":"box","text":"state backing. Cybersecurity incidents may result in any of the following: financial losses; interference","page_number":168,"box":{"x":116,"y":422,"width":757,"height":12}},{"id":"01a59c3d-094a-4b8c-9475-c88db13285c7","block_type":"box","text":"with the Fund’s ability to calculate its NAV; disclosure of confidential information; impediments to","page_number":168,"box":{"x":116,"y":437,"width":721,"height":12}},{"id":"5d123264-c9c0-4fbb-81fe-8cc7d59f842f","block_type":"box","text":"trading; submission of erroneous trades by the Fund or erroneous subscription or redemption orders;","page_number":168,"box":{"x":116,"y":453,"width":754,"height":12}},{"id":"8b89e455-d72e-43dd-9fed-175c65343713","block_type":"box","text":"the inability of the Fund or its service providers to transact business; violations of applicable privacy","page_number":168,"box":{"x":116,"y":468,"width":743,"height":12}},{"id":"e3686944-3a0b-4311-91a1-370c43cce888","block_type":"box","text":"and other laws; regulatory fines; penalties; reputational damage; reimbursement or other compensation","page_number":168,"box":{"x":116,"y":484,"width":772,"height":12}},{"id":"9ad5f2c6-a049-43a5-8c0c-817a9895cc45","block_type":"box","text":"costs; and other legal and compliance expenses. Furthermore, cybersecurity incidents may render","page_number":168,"box":{"x":116,"y":500,"width":735,"height":12}},{"id":"491923d1-1dfd-42d4-9dd8-bd29632e9473","block_type":"box","text":"records of the Fund, including records relating to its assets and transactions, shareholder ownership of","page_number":168,"box":{"x":117,"y":515,"width":766,"height":12}},{"id":"120ff4d9-04ef-473c-b34f-10a421427691","block_type":"box","text":"Fund shares, and other data integral to the Fund’s functioning, inaccessible, inaccurate or incomplete.","page_number":168,"box":{"x":117,"y":530,"width":761,"height":13}},{"id":"763114c0-47d7-4cff-a928-7d77ad0e2d19","block_type":"box","text":"Power outages, natural disasters, equipment malfunctions and processing errors that threaten","page_number":168,"box":{"x":117,"y":546,"width":702,"height":12}},{"id":"cc51a827-984a-47c5-bdeb-beaa9f8f3557","block_type":"box","text":"information and technology systems relied upon by the Fund or its service providers, as well as market","page_number":168,"box":{"x":117,"y":561,"width":766,"height":13}},{"id":"4488167e-01ce-48cd-be98-dba5a074ae31","block_type":"box","text":"events that occur at a pace that overloads these systems, may also disrupt business operations or","page_number":168,"box":{"x":116,"y":577,"width":735,"height":12}},{"id":"7311ce9f-ca6d-44c2-a3c4-7ba11d604039","block_type":"box","text":"impact critical data. Recent advances in AI technology pose risks to the Fund and its portfolio","page_number":168,"box":{"x":117,"y":592,"width":696,"height":13}},{"id":"273a8e80-6961-4598-b768-de5e82559899","block_type":"box","text":"investments. These advancements could harm the Fund and its portfolio investments by reducing the","page_number":168,"box":{"x":117,"y":608,"width":756,"height":12}},{"id":"dec39acc-4527-46e2-a0dd-506cbba67313","block_type":"box","text":"demand for both the technology and software offerings of the Fund’s portfolio investments.","page_number":168,"box":{"x":116,"y":623,"width":677,"height":13}},{"id":"49545bb6-4980-4c43-809d-1fb7338587e6","block_type":"box","text":"Additionally, these advancements could significantly disrupt the Fund’s portfolio investments and","page_number":168,"box":{"x":116,"y":639,"width":722,"height":12}},{"id":"811685ce-d2ff-46ae-ade4-ba8b371c3007","block_type":"box","text":"subject them to increased competition, which could have a material adverse effect on business,","page_number":168,"box":{"x":116,"y":654,"width":714,"height":13}},{"id":"6863a44b-429e-4488-8d38-e13c1c9a131b","block_type":"box","text":"financial condition, and results of operations. AI technology advancements, including efficiency","page_number":168,"box":{"x":116,"y":670,"width":703,"height":12}},{"id":"a12d6762-c67f-40ed-a9cc-b056a2bab24c","block_type":"box","text":"improvements, without related increases in the adoption and development of such technologies, could","page_number":168,"box":{"x":117,"y":685,"width":755,"height":13}},{"id":"1802571d-ee04-4bd8-aa0a-8f1d8fc53474","block_type":"box","text":"also negatively impact demand for, and the valuation of, digital infrastructure assets.","page_number":168,"box":{"x":116,"y":701,"width":624,"height":12}},{"id":"b0ce3918-09b7-49f6-8ea8-346267345da2","block_type":"box","text":"The Fund and its portfolio investments could be exposed to the risks of AI technology if third-party","page_number":168,"box":{"x":116,"y":729,"width":727,"height":12}},{"id":"f73119f4-368d-4859-bfc5-bccebedc23c4","block_type":"box","text":"service providers or any counterparties, whether or not known to the Fund, also use AI technology in","page_number":168,"box":{"x":116,"y":745,"width":745,"height":11}},{"id":"a395ffa6-453b-483d-9cd5-db8f7b630ca6","block_type":"box","text":"their business activities. The Fund and its service providers may not be in a position to control the use","page_number":168,"box":{"x":116,"y":760,"width":756,"height":12}},{"id":"6a3e5985-6d0a-4fb9-afa8-0d95aa42d8b6","block_type":"box","text":"of AI technology in third-party products or services.","page_number":168,"box":{"x":116,"y":775,"width":377,"height":12}},{"id":"078f445b-d8ac-4a06-bef1-07764eba2f9a","block_type":"box","text":"Use of AI technology could include the input of confidential information in contravention of applicable","page_number":168,"box":{"x":117,"y":803,"width":745,"height":12}},{"id":"daf92a1d-133f-466f-a02f-82e69e05b9a6","block_type":"box","text":"policies, contractual or other obligations or restrictions, resulting in such confidential information","page_number":168,"box":{"x":117,"y":819,"width":708,"height":12}},{"id":"0bb2de19-0c3b-4c74-98d2-046bd05afb3d","block_type":"box","text":"becoming accessible by other third-party AI technology applications and users.","page_number":168,"box":{"x":117,"y":834,"width":589,"height":12}},{"id":"b292f54f-c6fe-454f-b8e4-59ef2e37cd29","block_type":"box","text":"Independent of its context of use, AI technology is generally highly reliant on the collection and","page_number":168,"box":{"x":117,"y":862,"width":706,"height":12}},{"id":"e51e0f4d-e41e-48b2-aaee-86e0409b67f3","block_type":"box","text":"analysis of large amounts of data, may incorporate biased or inaccurate data, and it is not possible or","page_number":168,"box":{"x":116,"y":878,"width":757,"height":12}},{"id":"6ee9d26f-8e0e-4fcb-a542-082dcbb0fb10","block_type":"box","text":"II-81","page_number":168,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"94480e41-47bf-42ef-8c46-5defc30445b1","block_type":"box","text":"NM1026U-6004382-168/605","page_number":168,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"7cc12019-b523-4c2d-b784-fb7582d0ec2d","block_type":"box","text":"practicable to incorporate all relevant data into the models that AI technology utilizes to operate.","page_number":169,"box":{"x":117,"y":87,"width":715,"height":12}},{"id":"eba12477-2e16-4107-be30-f6184e9b328e","block_type":"box","text":"Certain data in such models will inevitably contain a degree of inaccuracy and error, or could otherwise","page_number":169,"box":{"x":117,"y":102,"width":768,"height":13}},{"id":"e0e3f233-9f35-4227-a273-873cb55a9c56","block_type":"box","text":"be inadequate or flawed, which would be likely to degrade the effectiveness of AI technology. 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In October 2023, an executive order established new standards for AI safety and","page_number":169,"box":{"x":116,"y":320,"width":729,"height":12}},{"id":"6d0f646a-6484-4866-aa4e-7abe482ce8c0","block_type":"box","text":"security. In addition to the U.S. regulatory framework, in 2024, the EU adopted the Artificial Intelligence","page_number":169,"box":{"x":116,"y":335,"width":769,"height":12}},{"id":"fc2351ea-7646-4637-a29f-0d83966b995a","block_type":"box","text":"Act, which applies to certain AI technology and the","page_number":169,"box":{"x":116,"y":351,"width":380,"height":12}},{"id":"12c397f6-7172-42a1-b60a-432d85e93f6c","block_type":"box","text":"data used to train, test, and deploy them, which","page_number":169,"box":{"x":497,"y":351,"width":357,"height":12}},{"id":"79d5d616-99f6-4afc-aa24-b51b06cf8b3a","block_type":"box","text":"may create additional compliance burdens, higher administrative costs, and significant penalties should","page_number":169,"box":{"x":117,"y":366,"width":770,"height":12}},{"id":"6ea0873a-c284-42af-b148-e4a85a5752e8","block_type":"box","text":"the Fund, the adviser, or the Fund’s portfolio investments fail to comply.","page_number":169,"box":{"x":116,"y":382,"width":537,"height":12}},{"id":"fd644154-627d-476d-9c66-8975a3363b95","block_type":"box","text":"AI technology and its applications, including in the investment and financial sectors, continue to","page_number":169,"box":{"x":116,"y":413,"width":711,"height":12}},{"id":"5a5aa090-d98f-442b-b6b8-2a1f1f3bc959","block_type":"box","text":"develop rapidly, and it is impossible to predict the future risks that may arise from such developments.","page_number":169,"box":{"x":116,"y":428,"width":762,"height":12}},{"id":"dee85b4a-dde5-4985-9dd5-ba0f7d61cfe1","block_type":"box","text":"The full extent of current or future risks related thereto is not possible to predict, and the Fund may not","page_number":169,"box":{"x":116,"y":444,"width":765,"height":12}},{"id":"d3ee2c2a-741f-44ad-80b6-e7ff76d07abf","block_type":"box","text":"be able to anticipate, prevent, mitigate, or remediate all of the potential risks, challenges, or impacts of","page_number":169,"box":{"x":117,"y":459,"width":763,"height":12}},{"id":"68ff5a21-50a0-4b8c-886f-272f98ec6f88","block_type":"box","text":"such changes.","page_number":169,"box":{"x":116,"y":475,"width":113,"height":12}},{"id":"d6cc861f-2db8-46e7-9b8a-e435afa8f582","block_type":"box","text":"While the Fund’s service providers are required to have appropriate operational, information security","page_number":169,"box":{"x":116,"y":506,"width":750,"height":12}},{"id":"1a3f0af8-c331-4deb-a712-efbc6842a6b2","block_type":"box","text":"and cybersecurity risk management policies and procedures, their methods of risk management may","page_number":169,"box":{"x":116,"y":521,"width":753,"height":12}},{"id":"85013ff9-7bbb-4f54-8786-c7c123ebe83c","block_type":"box","text":"differ from those of the Fund in the setting of priorities, the personnel and resources available or the","page_number":169,"box":{"x":116,"y":537,"width":745,"height":12}},{"id":"e995b655-5eb9-442a-9141-f62b772f7eeb","block_type":"box","text":"effectiveness of relevant controls. The Fund and its adviser seek to reduce these risks through","page_number":169,"box":{"x":116,"y":552,"width":706,"height":12}},{"id":"bc6bf711-5f98-43ac-9968-33b2c9dded42","block_type":"box","text":"controls, procedures and oversight, including establishing business continuity plans and risk","page_number":169,"box":{"x":116,"y":568,"width":687,"height":12}},{"id":"2b43c14e-fe0f-47ab-a8fc-767baaa81435","block_type":"box","text":"management systems. However, there are inherent limitations in such plans and systems, including","page_number":169,"box":{"x":117,"y":583,"width":744,"height":12}},{"id":"21823293-bead-4e37-936b-53b088d4a487","block_type":"box","text":"the possibility that certain risks that may affect the Fund have not been identified or may emerge in the","page_number":169,"box":{"x":116,"y":599,"width":766,"height":12}},{"id":"8c6c4aa4-e4d4-47e1-b852-8210ecbd0777","block_type":"box","text":"future; that such plans and systems may not completely eliminate the occurrence or mitigate the","page_number":169,"box":{"x":116,"y":614,"width":719,"height":12}},{"id":"69538552-ef90-4d54-8f9b-d9f9a3819cc4","block_type":"box","text":"effects of operational or information security disruptions or failures or of cybersecurity incidents; or that","page_number":169,"box":{"x":116,"y":630,"width":766,"height":12}},{"id":"137c3c19-3182-44ac-abef-6d2f8388adb0","block_type":"box","text":"prevention and remediation efforts will not be successful or that incidents will go undetected. The Fund","page_number":169,"box":{"x":117,"y":645,"width":766,"height":12}},{"id":"c68c3e6d-5872-43b1-b877-7090c9b1af84","block_type":"box","text":"cannot control the systems, information security or other cybersecurity of the issuers in which it invests","page_number":169,"box":{"x":116,"y":661,"width":762,"height":12}},{"id":"b8436cde-4a91-46b1-809e-f91affa3b1d0","block_type":"box","text":"or its service providers, counterparties, and other third parties whose activities affect the Fund.","page_number":169,"box":{"x":116,"y":676,"width":700,"height":12}},{"id":"83605dcf-5c8a-4fa6-ab27-e5a8a197fba2","block_type":"box","text":"Lastly, the regulatory climate governing cybersecurity and data protection is developing quickly and","page_number":169,"box":{"x":117,"y":707,"width":735,"height":12}},{"id":"3853fae6-8a26-4dc1-8a9b-354b50fe42f1","block_type":"box","text":"may vary considerably across jurisdictions. Regulators continue to develop new rules and standards","page_number":169,"box":{"x":117,"y":723,"width":742,"height":12}},{"id":"bd32b419-cf36-47a3-929a-0560079ee34a","block_type":"box","text":"related to cybersecurity and data protection. Compliance with evolving regulations can be demanding","page_number":169,"box":{"x":117,"y":738,"width":750,"height":12}},{"id":"e6928760-759e-4ae1-bd98-d999889d8d29","block_type":"box","text":"and costly, requiring substantial resources to monitor and implement required changes.","page_number":169,"box":{"x":116,"y":754,"width":647,"height":12}},{"id":"78042ad3-f0e9-4074-92ef-350f2c95ae70","block_type":"box","text":"Participation Notes.","page_number":169,"box":{"x":116,"y":785,"width":157,"height":12}},{"id":"3ed776dc-c724-4f2e-82ac-26f193156ff9","block_type":"box","text":"A Fund may buy participation notes from a bank or broker-dealer (“issuer”) that","page_number":169,"box":{"x":279,"y":785,"width":586,"height":12}},{"id":"c7eead93-0a5e-4398-88c4-8537cf5981cd","block_type":"box","text":"entitle the Fund to a return measured by the change in value of an identified underlying security or","page_number":169,"box":{"x":116,"y":800,"width":729,"height":12}},{"id":"d2b05930-c9af-480e-aab7-809ead9fa476","block_type":"box","text":"basket of securities (collectively, the “underlying security”). Participation notes are typically used when","page_number":169,"box":{"x":117,"y":816,"width":755,"height":12}},{"id":"d47a0fea-06d7-419f-b629-d2daa039306f","block_type":"box","text":"a direct investment in the underlying security is restricted due to country-specific regulations.","page_number":169,"box":{"x":116,"y":831,"width":692,"height":12}},{"id":"e9e188eb-9279-4fed-8b24-057f07d10228","block_type":"box","text":"The Fund is subject to counterparty risk associated with each issuer. Investment in a participation note","page_number":169,"box":{"x":116,"y":862,"width":766,"height":12}},{"id":"b6650a63-55d4-44c5-92de-8d5fd540d033","block_type":"box","text":"is not the same as investment in the constituent shares of the company. 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A participation note does not provide any beneficial or equitable","page_number":170,"box":{"x":116,"y":102,"width":725,"height":13}},{"id":"2f30825c-f95a-4d92-8694-3cc6b1094e1e","block_type":"box","text":"entitlement or interest in the relevant underlying security. In other words, shares of the underlying","page_number":170,"box":{"x":116,"y":118,"width":727,"height":12}},{"id":"6f114859-e63d-4027-bfe0-a25c2010651d","block_type":"box","text":"security are not in any way owned by the Fund. However, each participation note synthetically","page_number":170,"box":{"x":116,"y":134,"width":702,"height":12}},{"id":"c89e6e96-c920-4c93-8e5b-6b43149b2ff9","block_type":"box","text":"replicates the economic benefit of holding shares in the underlying security. Because a participation","page_number":170,"box":{"x":117,"y":149,"width":743,"height":12}},{"id":"446636c0-8a06-4dfc-8b44-6edb101a31d4","block_type":"box","text":"note is an obligation of the issuer, rather than a direct investment in shares of the underlying security, a","page_number":170,"box":{"x":117,"y":165,"width":770,"height":12}},{"id":"f1d663ea-cb3d-4b27-b182-74a39a9bc3aa","block_type":"box","text":"Fund may suffer losses potentially equal to the full value of the participation note if the issuer fails to","page_number":170,"box":{"x":117,"y":180,"width":745,"height":12}},{"id":"bea80ef5-ba2d-44f4-9e45-f081d30fe6ba","block_type":"box","text":"perform its obligations. A Fund attempts to mitigate that risk by purchasing only from issuers","page_number":170,"box":{"x":117,"y":196,"width":689,"height":12}},{"id":"1a1dc7cc-d31e-403b-a19d-ddcc63258553","block_type":"box","text":"determined to be creditworthy.","page_number":170,"box":{"x":116,"y":211,"width":231,"height":12}},{"id":"ac752666-9cac-41a6-8c7d-65a31c3307b7","block_type":"box","text":"The counterparty may, but is not required to, purchase the shares of the underlying security to hedge","page_number":170,"box":{"x":116,"y":242,"width":755,"height":12}},{"id":"f296f4b8-bf8f-4dbb-b21c-397be7dca86b","block_type":"box","text":"its obligation. A Fund may, but is not required to, purchase credit protection against the default of the","page_number":170,"box":{"x":117,"y":258,"width":752,"height":12}},{"id":"fe4d0fe0-dbc9-47ab-8816-fc2402226a8f","block_type":"box","text":"issuer. When the participation note expires or a Fund exercises the participation note and closes its","page_number":170,"box":{"x":117,"y":273,"width":742,"height":12}},{"id":"6377dacf-7165-4a17-b3af-b3c3ec931891","block_type":"box","text":"position, the Fund receives a payment that is based upon the then-current value of the underlying","page_number":170,"box":{"x":117,"y":289,"width":728,"height":12}},{"id":"97b51ef3-4107-4de2-ba01-aac1e4d1c20c","block_type":"box","text":"security converted into U.S. dollars (less transaction costs). The price, performance and liquidity of a","page_number":170,"box":{"x":116,"y":304,"width":751,"height":12}},{"id":"4ac71d09-7321-4043-876e-3a852152a853","block_type":"box","text":"participation note are all linked directly to the underlying security. A Fund’s ability to redeem or","page_number":170,"box":{"x":117,"y":320,"width":704,"height":12}},{"id":"d8e030d7-7ba4-4e45-8c00-667a5819ea9e","block_type":"box","text":"exercise a participation note generally is dependent on the liquidity in the local trading market for the","page_number":170,"box":{"x":116,"y":335,"width":750,"height":12}},{"id":"b991c144-351c-46f9-827b-d7f6c6d1c8c9","block_type":"box","text":"security underlying the participation note.","page_number":170,"box":{"x":116,"y":351,"width":310,"height":12}},{"id":"f8110746-cad5-4cc5-9e1a-19e67aaacbba","block_type":"box","text":"Portfolio Turnover Rates.","page_number":170,"box":{"x":116,"y":382,"width":201,"height":9}},{"id":"1adba91a-ca48-4620-b8b5-6f3c4edb9617","block_type":"box","text":"A Fund’s annual portfolio turnover rate will not be a factor preventing a sale","page_number":170,"box":{"x":318,"y":382,"width":569,"height":12}},{"id":"5238621e-b40c-407c-a95a-a0f033aa9e06","block_type":"box","text":"or purchase when the Manager believes investment considerations warrant such sale or purchase.","page_number":170,"box":{"x":116,"y":397,"width":738,"height":12}},{"id":"cd242c3c-7536-45d4-9a2a-5fba317614ca","block_type":"box","text":"Although certain Funds will use an approach to investing that is largely a passive, indexing approach,","page_number":170,"box":{"x":116,"y":413,"width":756,"height":12}},{"id":"1a20b4d1-c1ca-49cb-af81-b5bcb6474e84","block_type":"box","text":"such Funds may engage in a substantial number of portfolio transactions. With respect to these Funds,","page_number":170,"box":{"x":116,"y":428,"width":770,"height":12}},{"id":"d0f962c7-7577-42c2-8819-44eb626014ed","block_type":"box","text":"the rate of portfolio turnover will be a limiting factor when the Manager considers whether to purchase","page_number":170,"box":{"x":116,"y":444,"width":759,"height":12}},{"id":"bf871130-8ced-467e-ac83-924e51252d63","block_type":"box","text":"or sell securities for a Fund only to the extent that the Manager will consider the impact of transaction","page_number":170,"box":{"x":116,"y":459,"width":756,"height":12}},{"id":"98e30e3b-a9c4-4e23-9a63-b3f6d8d56003","block_type":"box","text":"costs on a Fund’s tracking error. Portfolio turnover may vary greatly from year to year as well as within","page_number":170,"box":{"x":116,"y":475,"width":765,"height":12}},{"id":"e3f81428-990f-4543-9f89-0152e7004a08","block_type":"box","text":"a particular year. High portfolio turnover (","page_number":170,"box":{"x":116,"y":490,"width":305,"height":12}},{"id":"70a6550e-1279-4467-8e8d-9dfd911abec6","block_type":"box","text":"i.e.","page_number":170,"box":{"x":422,"y":490,"width":21,"height":10}},{"id":"e2916bdc-5c77-4a03-ac52-f91a04ca570f","block_type":"box","text":", 100% or more) may result in increased transaction costs","page_number":170,"box":{"x":446,"y":490,"width":433,"height":12}},{"id":"5739455f-0d50-42ac-9fcd-f71a3ef113b8","block_type":"box","text":"to a Fund, including brokerage commissions, dealer mark-ups and other transaction costs on the sale","page_number":170,"box":{"x":116,"y":506,"width":759,"height":12}},{"id":"424fec65-e840-43d4-946c-16ae221c5ebd","block_type":"box","text":"of the securities and reinvestment in other securities. 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These effects of higher than normal portfolio turnover may adversely affect a","page_number":170,"box":{"x":116,"y":552,"width":761,"height":12}},{"id":"475fba98-5162-4523-8e00-9f35bcf9d082","block_type":"box","text":"Fund’s performance.","page_number":170,"box":{"x":117,"y":568,"width":158,"height":12}},{"id":"0875e1b3-1fb6-4e7f-80a0-21d25515a957","block_type":"box","text":"Preferred Stock.","page_number":170,"box":{"x":116,"y":599,"width":126,"height":9}},{"id":"1025d944-ed37-467c-804b-75d64f759f55","block_type":"box","text":"Certain Funds may invest in preferred sto","page_number":170,"box":{"x":243,"y":599,"width":306,"height":12}},{"id":"ef5dddaa-df2a-4ba5-8439-8630d2c42058","block_type":"box","text":"cks. Preferred stock has a preference over","page_number":170,"box":{"x":550,"y":599,"width":314,"height":12}},{"id":"d3617f48-31ae-4e6d-acb5-f356e3de1869","block_type":"box","text":"common stock in liquidation (and generally dividends","page_number":170,"box":{"x":116,"y":614,"width":384,"height":12}},{"id":"9d1b26f1-6d78-4a3e-85fc-9e72add34f9e","block_type":"box","text":"as well) but is subordinated to bond holders and","page_number":170,"box":{"x":501,"y":614,"width":358,"height":12}},{"id":"039958e7-da08-4c19-937b-9d64e49e2523","block_type":"box","text":"other creditors in all respects. As a general rule, t","page_number":170,"box":{"x":116,"y":630,"width":357,"height":12}},{"id":"ad0b43bb-9f93-4b59-9ea6-d83ca33310e4","block_type":"box","text":"he market value of preferred stock with a fixed dividend","page_number":170,"box":{"x":474,"y":630,"width":406,"height":12}},{"id":"01e04ba5-94c4-41a4-bafa-1fad224490b4","block_type":"box","text":"rate and no conversion element varies inversely with","page_number":170,"box":{"x":117,"y":645,"width":386,"height":12}},{"id":"4d9b9442-f243-406e-bf87-e4842446eba8","block_type":"box","text":"interest rates and perceived credit risk, while the","page_number":170,"box":{"x":504,"y":645,"width":355,"height":12}},{"id":"ac675e5a-a31c-4917-8430-46d11726c2d3","block_type":"box","text":"market price of convertible preferred stock generally","page_number":170,"box":{"x":117,"y":661,"width":377,"height":12}},{"id":"6849da1a-e20e-4e4a-bb87-d6cdf29b9fbe","block_type":"box","text":"also reflects some element of conversion value.","page_number":170,"box":{"x":499,"y":661,"width":345,"height":9}},{"id":"ec6f94f8-f9c9-4cd9-bb70-58d2f7321a6d","block_type":"box","text":"Because preferred stock is junior to debt securities","page_number":170,"box":{"x":117,"y":676,"width":367,"height":12}},{"id":"7c030800-7a10-4aca-af1d-bd989525d0d4","block_type":"box","text":"and other obligations of the issuer, deterioration in the","page_number":170,"box":{"x":489,"y":676,"width":391,"height":12}},{"id":"1499257d-bf8e-44bf-bc01-a9ab445af3e2","block_type":"box","text":"credit quality of the issuer will cause greater changes in","page_number":170,"box":{"x":116,"y":692,"width":402,"height":12}},{"id":"abbafb82-2e16-4504-b8f0-d3b53d3a1511","block_type":"box","text":"the value of a preferred stock than in a more","page_number":170,"box":{"x":523,"y":692,"width":323,"height":12}},{"id":"9bec0141-9d17-4e8f-a706-1bf171724e03","block_type":"box","text":"senior debt security with similar stated yield characte","page_number":170,"box":{"x":116,"y":707,"width":383,"height":12}},{"id":"2ba28c70-0449-4db9-a575-88f6365fe436","block_type":"box","text":"ristics. Unlike interest payments on debt securities,","page_number":170,"box":{"x":500,"y":707,"width":367,"height":12}},{"id":"b72ea6e7-e7ed-4fcb-974b-d85ef62a83e8","block_type":"box","text":"preferred stock dividends are payable only if declared by","page_number":170,"box":{"x":117,"y":723,"width":410,"height":12}},{"id":"f8154b6b-5a88-4553-b5a0-d97781bb40f5","block_type":"box","text":"the issuer’s board of di","page_number":170,"box":{"x":532,"y":723,"width":164,"height":9}},{"id":"25a88514-3495-4f59-a09b-f6a0c8d5c824","block_type":"box","text":"rectors. Preferred stock","page_number":170,"box":{"x":698,"y":723,"width":170,"height":9}},{"id":"c2dd52a1-3496-49a9-bc17-5b537ccd6095","block_type":"box","text":"also may be subject to optional or mandatory redemption provisions.","page_number":170,"box":{"x":116,"y":738,"width":496,"height":12}},{"id":"97bc4447-a5a6-40a3-abb6-0fd80d2a8800","block_type":"box","text":"Tax-Exempt Preferred Shares.","page_number":170,"box":{"x":118,"y":769,"width":224,"height":12}},{"id":"4983fcfb-853a-4bff-82c5-fb99dffb2cc8","block_type":"box","text":"Certain Funds may invest in preferred interests of other investment","page_number":170,"box":{"x":350,"y":769,"width":497,"height":12}},{"id":"afb09ba8-a17b-4e0c-8abe-9b52c8034546","block_type":"box","text":"funds that pay dividends that are exempt from regular U.S. federal income tax. Such funds in turn","page_number":170,"box":{"x":116,"y":785,"width":722,"height":12}},{"id":"bad80e6f-30c0-46da-8a31-7ee0650b33aa","block_type":"box","text":"invest in municipal bonds and other assets that pay interest or make distributions that are exempt from","page_number":170,"box":{"x":117,"y":800,"width":759,"height":12}},{"id":"acd48d76-a585-465c-9620-dc30b10c9df3","block_type":"box","text":"regular U.S. federal income tax, such as revenue bonds issued by state or local agencies to fund the","page_number":170,"box":{"x":117,"y":816,"width":746,"height":12}},{"id":"ffb326a4-3b65-4e7c-bbc7-f6268e743637","block_type":"box","text":"development of low-income, multi-family housing. Investment in such tax-exempt preferred shares","page_number":170,"box":{"x":116,"y":831,"width":733,"height":12}},{"id":"8f3772b5-98d5-4792-8653-9da1af863cd5","block_type":"box","text":"involves many of the same issues as investing in other investment companies. These investments also","page_number":170,"box":{"x":117,"y":847,"width":768,"height":12}},{"id":"ee46ae18-8b17-42a1-a0f8-dd3bc8a51ac2","block_type":"box","text":"have additional risks, including illiquid investments risk, the absence of regulation governing","page_number":170,"box":{"x":117,"y":862,"width":685,"height":12}},{"id":"86c51192-51e5-441f-a7a8-fd21b66786c2","block_type":"box","text":"investment practices, capital structure and leverage, affiliated transactions and other matters, and","page_number":170,"box":{"x":117,"y":878,"width":729,"height":12}},{"id":"bb483e26-6106-4a5c-a587-d2ae9c169c0d","block_type":"box","text":"II-83","page_number":170,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"d42e974b-2845-4791-98eb-29d64b68739f","block_type":"box","text":"NM1026U-6004382-170/605","page_number":170,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"76f303bb-994f-4dc1-8642-4ed78d30342a","block_type":"box","text":"concentration of investments in particular issuers or industries. The Municipal Bond Funds will treat","page_number":171,"box":{"x":116,"y":87,"width":740,"height":12}},{"id":"606ad057-59d1-4078-ad53-cd0037c92b9f","block_type":"box","text":"investments in tax-exempt preferred shares as investments in municipal bonds.","page_number":171,"box":{"x":117,"y":102,"width":593,"height":12}},{"id":"19d87c94-860f-4d7e-9ed7-f58ab2bfb34b","block_type":"box","text":"Trust Preferred Securities.","page_number":171,"box":{"x":118,"y":134,"width":193,"height":9}},{"id":"6523d5aa-cff9-4380-a3cc-a9aacdba6cc2","block_type":"box","text":"Certain Funds may invest in trust preferred securities. Trust preferred","page_number":171,"box":{"x":312,"y":134,"width":525,"height":12}},{"id":"8562e359-3ee7-49f4-bcd5-08064d4c3702","block_type":"box","text":"securities are typically issued by corporations, generally in the form of interest bearing notes with","page_number":171,"box":{"x":116,"y":149,"width":724,"height":12}},{"id":"756ba109-6255-4598-8e18-d9daea273506","block_type":"box","text":"preferred securities characteristics, or by an affiliated business trust of a corporation, generally in the","page_number":171,"box":{"x":117,"y":165,"width":751,"height":12}},{"id":"2881f851-aca6-4039-b73c-0c398de44bc3","block_type":"box","text":"form of beneficial interests in subordinated debentures or similarly structured securities. The trust","page_number":171,"box":{"x":116,"y":180,"width":726,"height":12}},{"id":"5cc20ed1-0d54-4b1e-8ecb-d2aac684e754","block_type":"box","text":"preferred securities market consists of both fixed and adjustable coupon rate securities that are either","page_number":171,"box":{"x":117,"y":196,"width":758,"height":12}},{"id":"4eabb83b-b48c-4be1-8356-02baffc1d507","block_type":"box","text":"perpetual in nature or have stated maturity dates.","page_number":171,"box":{"x":117,"y":211,"width":370,"height":12}},{"id":"87ea99d8-6ea2-48bb-a762-fb52508abd2c","block_type":"box","text":"Trust preferred securities are typically junior and fully subordinated liabilities of an issuer and benefit","page_number":171,"box":{"x":116,"y":242,"width":748,"height":12}},{"id":"c98e0ab8-a9b4-4f86-8a82-32e8c6e10903","block_type":"box","text":"from a guarantee that is junior and fully subordinated to the other liabilities of the guarantor. In addition,","page_number":171,"box":{"x":116,"y":258,"width":771,"height":12}},{"id":"c14ba8d7-1f8c-4a3e-a65c-af8f9f21ef49","block_type":"box","text":"trust preferred securities typically permit an issuer to defer the payment of income for five years or","page_number":171,"box":{"x":116,"y":273,"width":733,"height":12}},{"id":"40889cd4-d5b0-4d67-bd6b-5ec1765f5709","block_type":"box","text":"more without triggering an event of default. Because of their subordinated position in the capital","page_number":171,"box":{"x":117,"y":289,"width":713,"height":12}},{"id":"19fd7069-3fc4-4120-b3f8-fb34849ac971","block_type":"box","text":"structure of an issuer, the ability to defer payments for extended periods of time without default","page_number":171,"box":{"x":116,"y":304,"width":708,"height":12}},{"id":"d50817af-f51e-4525-ad24-265447aa94e6","block_type":"box","text":"consequences to the issuer, and certain other features (such as restrictions on common dividend","page_number":171,"box":{"x":116,"y":320,"width":725,"height":12}},{"id":"b94046ef-89a5-48e6-97fd-3288163ada22","block_type":"box","text":"payments by the issuer or ultimate guarantor when full cumulative payments on the trust preferred","page_number":171,"box":{"x":117,"y":335,"width":733,"height":12}},{"id":"b0ad2b89-d007-465d-8447-f6b2512e8fa0","block_type":"box","text":"securities have not been made), these trust preferred securities are often treated as close substitutes","page_number":171,"box":{"x":116,"y":351,"width":756,"height":12}},{"id":"127b4ca2-778b-4422-b60f-1d44ccb873d9","block_type":"box","text":"for traditional preferred securities, both by issuers and investors.","page_number":171,"box":{"x":116,"y":366,"width":483,"height":12}},{"id":"529051e3-c8f4-4198-903f-8a3bdc750363","block_type":"box","text":"Trust preferred securities include but are not limited to trust originated preferred securities (“TOPRS","page_number":171,"box":{"x":116,"y":397,"width":740,"height":12}},{"id":"887d38ac-2eb4-45f6-a7b2-37b45b064d3d","block_type":"box","text":"®","page_number":171,"box":{"x":857,"y":396,"width":9,"height":7}},{"id":"49ed931f-1753-41fe-a40f-43f93d8b0f94","block_type":"box","text":"”);","page_number":171,"box":{"x":867,"y":397,"width":20,"height":12}},{"id":"9768ce3a-e239-4657-8938-d9d7f75d0696","block_type":"box","text":"monthly income preferred securities (“MIPS","page_number":171,"box":{"x":117,"y":413,"width":322,"height":12}},{"id":"bbfeac1d-986f-49aa-8a8d-c68335842b78","block_type":"box","text":"®","page_number":171,"box":{"x":439,"y":412,"width":10,"height":7}},{"id":"26b6cfd1-6cc6-40cd-999b-550f9c76d991","block_type":"box","text":"”); quarterly income bond securities (“QUIBS","page_number":171,"box":{"x":449,"y":413,"width":330,"height":12}},{"id":"e86742c1-fa34-47e9-baa8-ed9b24886c82","block_type":"box","text":"®","page_number":171,"box":{"x":780,"y":412,"width":9,"height":7}},{"id":"de1dbaad-2cb1-423a-b288-5a70982e4273","block_type":"box","text":"” ); quarterly","page_number":171,"box":{"x":790,"y":413,"width":95,"height":12}},{"id":"f989823b-8d50-4ff9-a9f0-12fdc9ef6d57","block_type":"box","text":"income debt securities (“QUIDS","page_number":171,"box":{"x":117,"y":428,"width":234,"height":12}},{"id":"be65d3ed-b6b5-40ba-b62d-207a25760bfb","block_type":"box","text":"®","page_number":171,"box":{"x":352,"y":427,"width":10,"height":7}},{"id":"204b2155-d6a3-4f1a-92e0-737daf9bc520","block_type":"box","text":"”); quarterly income preferred securities (“QUIPS","page_number":171,"box":{"x":362,"y":428,"width":361,"height":12}},{"id":"5cec5ec4-dc63-491c-b8cf-bcb57b9a013d","block_type":"box","text":"SM","page_number":171,"box":{"x":724,"y":428,"width":16,"height":6}},{"id":"aa4c7d65-d8fd-46f9-a880-d07bdcb62867","block_type":"box","text":"”); corporate trust","page_number":171,"box":{"x":741,"y":428,"width":133,"height":12}},{"id":"8dddb1b4-e0f0-48b9-bef9-d84284980aba","block_type":"box","text":"securities (“CORTS","page_number":171,"box":{"x":116,"y":444,"width":145,"height":12}},{"id":"e78110d8-f889-4238-94b1-9cddaf214721","block_type":"box","text":"®","page_number":171,"box":{"x":262,"y":443,"width":9,"height":7}},{"id":"e01ff321-a4b6-4631-b634-c9c6dddcd0b2","block_type":"box","text":"”); public income notes (“PINES","page_number":171,"box":{"x":271,"y":444,"width":235,"height":12}},{"id":"c7aab517-fdf8-4c92-b42f-1b94c0d21a86","block_type":"box","text":"®","page_number":171,"box":{"x":507,"y":443,"width":9,"height":7}},{"id":"0ab4c0bb-0f5c-4ac7-9289-72a50319174d","block_type":"box","text":"”); and other trust preferred securities.","page_number":171,"box":{"x":517,"y":444,"width":287,"height":12}},{"id":"39eb0144-d18a-43b7-8786-6a2c5561df0f","block_type":"box","text":"Trust preferred securities are typically issued with a final maturity date, although some are perpetual in","page_number":171,"box":{"x":116,"y":475,"width":766,"height":12}},{"id":"6658ba6b-be42-4c5f-ace4-e2b85f6d165a","block_type":"box","text":"nature. In certain instances, a final maturity date may be extended and/or the final payment of principal","page_number":171,"box":{"x":117,"y":490,"width":767,"height":12}},{"id":"56f95780-609b-433f-8b44-c2d72a0a2713","block_type":"box","text":"may be deferred at the issuer’s option for a specified time without default. No redemption can typically","page_number":171,"box":{"x":117,"y":506,"width":760,"height":12}},{"id":"20298e1c-d076-4dee-84c7-7f7022dd4e71","block_type":"box","text":"take place unless all cumulative payment obligations have been met, although issuers may be able to","page_number":171,"box":{"x":116,"y":521,"width":758,"height":12}},{"id":"2a65f988-2f3f-4c26-8052-2b1e84cbb02c","block_type":"box","text":"engage in open-market repurchases without regard to whether all payments have been paid.","page_number":171,"box":{"x":116,"y":537,"width":693,"height":12}},{"id":"f30bdf22-9e47-46cb-8fb9-aa42bfcb350b","block_type":"box","text":"Many trust preferred securities are issued by trusts or other special purpose entities established by","page_number":171,"box":{"x":117,"y":568,"width":737,"height":12}},{"id":"b0041abd-2f92-43a7-8698-2868f7944a0a","block_type":"box","text":"operating companies and are not a direct obligation of an operating company. At the time the trust or","page_number":171,"box":{"x":116,"y":583,"width":752,"height":12}},{"id":"1162cfe8-4cd7-4fd1-86da-5f607d62042e","block_type":"box","text":"special purpose entity sells such preferred securities to investors, it purchases debt of the operating","page_number":171,"box":{"x":116,"y":599,"width":745,"height":12}},{"id":"eae206fa-315e-4281-801a-594003ed26d6","block_type":"box","text":"company (with terms comparable to those of the trust or special purpose entity securities), which","page_number":171,"box":{"x":116,"y":614,"width":722,"height":12}},{"id":"40f740fd-c2c0-4251-9364-a004e4300007","block_type":"box","text":"enables the operating company to deduct for tax purposes the interest paid on the debt held by the","page_number":171,"box":{"x":116,"y":630,"width":739,"height":12}},{"id":"0c98d573-35ce-45c2-8c9e-f728f4c27043","block_type":"box","text":"trust or special purpose entity. The trust or special purpose entity is generally required to be treated as","page_number":171,"box":{"x":116,"y":645,"width":765,"height":12}},{"id":"6cac0011-330a-48e7-b905-762b117f04dd","block_type":"box","text":"transparent for U.S. federal income tax purposes such that the holders of the trust preferred securities","page_number":171,"box":{"x":116,"y":661,"width":757,"height":12}},{"id":"846b5e8c-198e-4165-8f31-00764f8a676d","block_type":"box","text":"are treated as owning beneficial interests in the underlying debt of the operating company. Accordingly,","page_number":171,"box":{"x":116,"y":676,"width":765,"height":12}},{"id":"bc7ddc77-a49e-4c1a-a1f1-d12edb496ec0","block_type":"box","text":"payments on the trust preferred securities are treated as interest rather than dividends for U.S. federal","page_number":171,"box":{"x":117,"y":692,"width":757,"height":12}},{"id":"d6570287-5dfc-4d6b-b7d3-9a7966d1f33f","block_type":"box","text":"income tax purposes. The trust or special purpose entity in turn would be a holder of the operating","page_number":171,"box":{"x":117,"y":707,"width":727,"height":12}},{"id":"4c5b0107-d511-47d5-bc06-762fd4b43907","block_type":"box","text":"company’s debt and would have priority with respect to the operating company’s earnings and profits","page_number":171,"box":{"x":116,"y":723,"width":748,"height":12}},{"id":"4f3c8655-5b43-4ea8-aad3-b9d94241820b","block_type":"box","text":"over the operating company’s common shareholders but would typically be subordinated to other","page_number":171,"box":{"x":116,"y":738,"width":720,"height":12}},{"id":"8d6a5ebd-a4d7-4b20-b5ae-2f106f2b00dc","block_type":"box","text":"classes of the operating company’s debt. Typically, a preferred share has a rating that is slightly below","page_number":171,"box":{"x":116,"y":754,"width":760,"height":12}},{"id":"a8b9ebd9-f4d6-4c4f-8b20-53e1bd1757b2","block_type":"box","text":"that of its corresponding operating company’s senior debt securities.","page_number":171,"box":{"x":116,"y":769,"width":506,"height":12}},{"id":"6496a016-c33f-4531-b673-40c13faa2783","block_type":"box","text":"Real Estate Investment Trusts (“REITs”).","page_number":171,"box":{"x":116,"y":800,"width":324,"height":12}},{"id":"5c759dfd-5c46-46e7-8d60-e5a01632e0eb","block_type":"box","text":"In pursuing its investment strategy, a Fund may invest in","page_number":171,"box":{"x":448,"y":800,"width":417,"height":12}},{"id":"b5b66de1-b0ff-46ab-81d1-528665eab999","block_type":"box","text":"shares of REITs. REITs possess certain risks which differ from an investment in common stocks.","page_number":171,"box":{"x":116,"y":816,"width":718,"height":12}},{"id":"ca4d7557-9dfa-4278-8bbb-27261e91d0f7","block_type":"box","text":"REITs are financial vehicles that pool investor’s capital to purchase or finance real estate. REITs may","page_number":171,"box":{"x":117,"y":831,"width":756,"height":12}},{"id":"90bc00b4-5d8d-4744-a7f8-835ecae3cb2f","block_type":"box","text":"concentrate their investments in specific geographic areas or in specific property types,","page_number":171,"box":{"x":116,"y":847,"width":652,"height":12}},{"id":"ac422c73-69e3-423a-aecd-62beb1efd028","block_type":"box","text":"i.e.","page_number":171,"box":{"x":768,"y":847,"width":21,"height":9}},{"id":"998e4562-8b25-46b3-94c5-1f4676f27144","block_type":"box","text":", hotels,","page_number":171,"box":{"x":792,"y":847,"width":62,"height":11}},{"id":"993f7926-d711-46de-a1e3-4786b98b8053","block_type":"box","text":"shopping malls, residential complexes and office buildings.","page_number":171,"box":{"x":116,"y":862,"width":441,"height":12}},{"id":"4447daa1-cf75-4cbe-a6be-aa9f7068a27d","block_type":"box","text":"II-84","page_number":171,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"951a8258-b212-48a3-9939-698d92f566a0","block_type":"box","text":"NM1026U-6004382-171/605","page_number":171,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"92e53839-9066-4f99-8cea-333e0789a369","block_type":"box","text":"REITs are subject to management fees and other expenses, and so a Fund that invests in REITs will","page_number":172,"box":{"x":117,"y":87,"width":752,"height":12}},{"id":"9b0445e8-76a8-4472-9a89-4eb0cada8a75","block_type":"box","text":"bear its proportionate share of the costs of the REITs’ operations. There are three general categories","page_number":172,"box":{"x":117,"y":102,"width":754,"height":13}},{"id":"4ef094e1-f4ac-4611-baa5-33f616795c1a","block_type":"box","text":"of REITs: Equity REITs, Mortgage REITs and Hybrid REITs. Equity REITs invest primarily in direct fee","page_number":172,"box":{"x":116,"y":118,"width":763,"height":12}},{"id":"ca398d97-576e-4c47-b678-848529f2e2da","block_type":"box","text":"ownership or leasehold ownership of real property, which derive most of their income from rents.","page_number":172,"box":{"x":116,"y":134,"width":721,"height":12}},{"id":"ab9b217f-c52c-4296-8a54-32164878a185","block_type":"box","text":"Mortgage REITs invest mostly in mortgages on real estate, which may secure construction,","page_number":172,"box":{"x":117,"y":149,"width":681,"height":12}},{"id":"a7b0712d-672a-4ee6-a58a-9734203ed775","block_type":"box","text":"development or long-term loans; the main source of their income is mortgage interest payments.","page_number":172,"box":{"x":116,"y":165,"width":720,"height":12}},{"id":"bed54ca7-0bef-4387-889a-d7a87557986a","block_type":"box","text":"Hybrid REITs hold both ownership and mortgage interests in real estate.","page_number":172,"box":{"x":117,"y":180,"width":541,"height":12}},{"id":"ddd6bf2f-a605-4ef8-93a6-c3266193f226","block_type":"box","text":"Investing in REITs involves certain unique risks in addition to those risks associated with investing in","page_number":172,"box":{"x":117,"y":211,"width":749,"height":12}},{"id":"5234e0a3-689b-4b21-b29a-07cc4f3c00d9","block_type":"box","text":"the real estate industry in general. The market value of REIT shares and the ability of the REITs to","page_number":172,"box":{"x":116,"y":227,"width":735,"height":12}},{"id":"13cac899-f8ea-4a68-965b-92562be25ec8","block_type":"box","text":"distribute income may be adversely affected by several factors, including rising interest rates, changes","page_number":172,"box":{"x":116,"y":242,"width":765,"height":12}},{"id":"6fb3ab88-f258-4571-bd7a-a44e352e21c8","block_type":"box","text":"in the national, state and local economic climate and real estate conditions, occupancy and rental","page_number":172,"box":{"x":117,"y":258,"width":727,"height":12}},{"id":"12b3a522-1cae-4325-8e58-9529dda8f979","block_type":"box","text":"rates, perceptions of prospective tenants of the safety, convenience and attractiveness of the","page_number":172,"box":{"x":117,"y":273,"width":695,"height":12}},{"id":"279cd645-1fbd-449f-b7b0-c5009fc70b7f","block_type":"box","text":"properties, the ability of the owners to provide adequate management, maintenance and insurance, the","page_number":172,"box":{"x":117,"y":289,"width":770,"height":12}},{"id":"c2e5663a-dc13-4b2e-b430-88d58d194a64","block_type":"box","text":"cost of complying with the Americans with Disabilities Act, increased competition from new properties,","page_number":172,"box":{"x":116,"y":304,"width":761,"height":12}},{"id":"cccfaa68-6444-45b9-acc7-70cda5a53fbc","block_type":"box","text":"the impact of present or future environmental legislation and compliance with environmental laws,","page_number":172,"box":{"x":116,"y":320,"width":729,"height":12}},{"id":"1c2eecd7-5cbb-49b2-9a4d-d0880c637c8c","block_type":"box","text":"failing to maintain their exemptions from registration under the Investment Company Act, changes in","page_number":172,"box":{"x":116,"y":335,"width":749,"height":12}},{"id":"960f812f-5fe6-4c73-982e-15fa5e712f6c","block_type":"box","text":"real estate taxes and other operating expenses, adverse changes in governmental rules and fiscal","page_number":172,"box":{"x":117,"y":351,"width":733,"height":12}},{"id":"e55331cd-26e4-4bee-b24b-51cfc78a5615","block_type":"box","text":"policies, adverse changes in zoning laws and other factors beyond the control of the issuers of the","page_number":172,"box":{"x":117,"y":366,"width":733,"height":12}},{"id":"c94213d7-3366-47e4-bb55-69c01cef7876","block_type":"box","text":"REITs. To the extent that assets underlying a REIT are concentrated geographically, by property type,","page_number":172,"box":{"x":117,"y":382,"width":762,"height":12}},{"id":"be7fae31-fc83-44e8-9455-e23bed5e8f17","block_type":"box","text":"or in certain other respects, these risks may be heightened.","page_number":172,"box":{"x":116,"y":397,"width":446,"height":12}},{"id":"fc78ca9b-41be-4b97-b8b4-7b9a5101cf37","block_type":"box","text":"In addition, distributions received by a Fund from REITs may consist of dividends, capital gains and/or","page_number":172,"box":{"x":117,"y":428,"width":761,"height":12}},{"id":"f88d2c6c-25fb-4a03-b2f0-2aaf900cd888","block_type":"box","text":"return of capital. As REITs generally pay a higher rate of dividends (on a pre-tax basis) than operating","page_number":172,"box":{"x":117,"y":444,"width":760,"height":12}},{"id":"29c6f35e-09dc-4d52-b445-b542a8edf2b9","block_type":"box","text":"companies, to the extent application of the Fund’s investment strategy results in the Fund investing in","page_number":172,"box":{"x":116,"y":459,"width":758,"height":12}},{"id":"1a47cda5-0ecb-4362-a12b-2e519d209305","block_type":"box","text":"REIT shares, the percentage of the Fund’s dividend income received from REIT shares will likely","page_number":172,"box":{"x":117,"y":475,"width":722,"height":12}},{"id":"47fc4b60-d38c-402d-966e-073694133506","block_type":"box","text":"exceed the percentage of the Fund’s portfolio which is comprised of REIT shares. Ordinary REIT","page_number":172,"box":{"x":116,"y":490,"width":723,"height":12}},{"id":"de7b43f5-3700-45e6-908a-76e40e23502b","block_type":"box","text":"dividends received by the Fund and distributed to the Fund’s shareholders will generally be taxable as","page_number":172,"box":{"x":116,"y":506,"width":762,"height":12}},{"id":"8fe8e472-938a-45fe-bba2-365aebfc0efb","block_type":"box","text":"ordinary income and will not constitute “qualified dividend income.” However, a non-corporate taxpayer","page_number":172,"box":{"x":116,"y":521,"width":768,"height":12}},{"id":"221af8d7-4257-4b35-8e5d-4f400b4ec705","block_type":"box","text":"who is a direct REIT shareholder may claim a 20% “qualified business income” deduction for ordinary","page_number":172,"box":{"x":116,"y":537,"width":757,"height":12}},{"id":"8a3f5cfa-d1b8-4a2d-86e7-297cc2f5640f","block_type":"box","text":"REIT dividends, and a regulated investment company may report dividends as eligible for this","page_number":172,"box":{"x":117,"y":552,"width":698,"height":12}},{"id":"5fd31dd8-c2a1-4aed-abc5-7973c25307c4","block_type":"box","text":"deduction to the extent the regulated investment company’s income is derived from ordinary REIT","page_number":172,"box":{"x":116,"y":568,"width":731,"height":12}},{"id":"732a8acf-439e-4b3c-a589-175b11de18d6","block_type":"box","text":"dividends (reduced by allocable regulated investment company expenses). A shareholder may treat","page_number":172,"box":{"x":116,"y":583,"width":745,"height":12}},{"id":"c2512740-af46-46d7-a6a8-a0bec5ce4d7d","block_type":"box","text":"the dividends as such provided the regulated investment company and the shareholder satisfy","page_number":172,"box":{"x":116,"y":599,"width":704,"height":12}},{"id":"6ae6474f-abd1-4220-8878-bb92bb57af15","block_type":"box","text":"applicable holding period requirements.","page_number":172,"box":{"x":116,"y":614,"width":298,"height":12}},{"id":"48f3120f-4c8a-4936-b3c4-e9028f904c30","block_type":"box","text":"REITs (especially mortgage REITs) are also subject to interest rate risk. Rising interest rates may","page_number":172,"box":{"x":117,"y":645,"width":728,"height":12}},{"id":"f5fd9d0e-5b18-4e63-a3a9-1eb55123b852","block_type":"box","text":"cause REIT investors to demand a higher annual yield, which may, in turn, cause a decline in the","page_number":172,"box":{"x":116,"y":661,"width":720,"height":12}},{"id":"cbc74e44-7777-4123-9ad6-b72f74818efc","block_type":"box","text":"market price of the equity securities issued by a REIT. Rising interest rates also generally increase the","page_number":172,"box":{"x":117,"y":676,"width":759,"height":12}},{"id":"bd458896-9236-411e-a330-e1ee12f162ea","block_type":"box","text":"costs of obtaining financing, which could cause the value of a Fund’s REIT investments to decline.","page_number":172,"box":{"x":116,"y":692,"width":728,"height":12}},{"id":"f2c37783-425d-451f-b349-f24786bce13c","block_type":"box","text":"During periods when interest rates are declining, mortgages are often refinanced. Refinancing may","page_number":172,"box":{"x":117,"y":707,"width":733,"height":12}},{"id":"b872ac97-8748-4a5e-baa4-add22dfce6e8","block_type":"box","text":"reduce the yield on investments in mortgage REITs. In addition, since REITs depend on payment","page_number":172,"box":{"x":117,"y":723,"width":721,"height":12}},{"id":"d5ce8498-f28f-41ee-b4f6-5f24018ad98d","block_type":"box","text":"under their mortgage loans and leases to generate cash to make distributions to their shareholders,","page_number":172,"box":{"x":117,"y":738,"width":737,"height":12}},{"id":"e3512cec-1ae1-4980-8f52-9a1f5b8f6b48","block_type":"box","text":"investments in REITs may be adversely affected by defaults on such mortgage loans or leases.","page_number":172,"box":{"x":117,"y":754,"width":706,"height":12}},{"id":"c753f79c-f424-48f0-8ccd-3c6cec1ce727","block_type":"box","text":"Investing in certain REITs, which often have small mark","page_number":172,"box":{"x":117,"y":785,"width":403,"height":12}},{"id":"14dc517e-9fc6-48bc-903c-b9b0fac19c9e","block_type":"box","text":"et capitalizations, may also involve the same risks","page_number":172,"box":{"x":521,"y":785,"width":361,"height":12}},{"id":"e5e2c946-b437-4840-9d01-20c3299a2c80","block_type":"box","text":"as investing in other small capitalization compani","page_number":172,"box":{"x":116,"y":800,"width":354,"height":12}},{"id":"eddec710-7811-487d-82c1-71a18b438119","block_type":"box","text":"es. REITs may have limited financial resources and their","page_number":172,"box":{"x":472,"y":800,"width":410,"height":12}},{"id":"bda94fb3-f958-4f86-b5aa-57eabe0b1d71","block_type":"box","text":"securities may trade less frequently and in limited volu","page_number":172,"box":{"x":116,"y":816,"width":393,"height":12}},{"id":"1b151208-3520-4668-aa1c-822e2473577a","block_type":"box","text":"me and may be subject to more abrupt or erratic","page_number":172,"box":{"x":511,"y":816,"width":350,"height":12}},{"id":"c5c139bc-8920-4d38-8d03-19cb6da162b7","block_type":"box","text":"price movements than larger company securities. Histo","page_number":172,"box":{"x":117,"y":831,"width":399,"height":12}},{"id":"39a88983-9db1-403c-8315-2a73c85eb863","block_type":"box","text":"rically, small capitalization stocks, such as REITs,","page_number":172,"box":{"x":518,"y":831,"width":364,"height":12}},{"id":"5f987d3b-d97f-49ab-ad65-83bc562af4d2","block_type":"box","text":"have been more volatile in price than the larger c","page_number":172,"box":{"x":117,"y":847,"width":354,"height":12}},{"id":"a1d2db53-10ad-46b9-8256-bf9fe0d33c83","block_type":"box","text":"apitalization stocks such as those included in the S&P","page_number":172,"box":{"x":472,"y":847,"width":396,"height":12}},{"id":"07bc9fcd-bb8a-400e-9146-b6db6fa66f82","block_type":"box","text":"500 Index. The management of a REIT may be subject to","page_number":172,"box":{"x":116,"y":862,"width":423,"height":12}},{"id":"037d44bb-3f65-40d3-ae44-f26ad9a875dd","block_type":"box","text":"conflicts of interest with respect to the","page_number":172,"box":{"x":540,"y":862,"width":278,"height":12}},{"id":"b6189cbf-a8fc-460b-afee-12227f260dd9","block_type":"box","text":"operation of the business of the REIT and may be involved","page_number":172,"box":{"x":116,"y":878,"width":432,"height":12}},{"id":"35ac93af-c83a-4f35-98f5-240c7ea1dd10","block_type":"box","text":"in real estate activities competitive with the","page_number":172,"box":{"x":549,"y":878,"width":314,"height":12}},{"id":"ec11fd6c-1d2b-4133-a463-9b7d7b4ebd77","block_type":"box","text":"II-85","page_number":172,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"2d12b63c-2102-49cc-97d5-48fcef873345","block_type":"box","text":"NM1026U-6004382-172/605","page_number":172,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"7ba270b5-0a66-44a7-a52a-20d3356b8c5d","block_type":"box","text":"REIT. REITs may own properties through joint ventures","page_number":173,"box":{"x":117,"y":87,"width":407,"height":12}},{"id":"79b73a61-33e9-4282-9127-bb190ade455f","block_type":"box","text":"or in other circumstances in which the REIT may","page_number":173,"box":{"x":525,"y":87,"width":357,"height":12}},{"id":"352a7820-33eb-437d-ab1f-e8fcfaf94985","block_type":"box","text":"not have control over its investments. REITs","page_number":173,"box":{"x":117,"y":103,"width":320,"height":9}},{"id":"a92f342a-6747-45a9-9adc-7949b2ea2a08","block_type":"box","text":"may incur significant amounts of leverage.","page_number":173,"box":{"x":438,"y":102,"width":316,"height":13}},{"id":"88dc7ace-aa00-4d8f-96ce-f44860a1d3ab","block_type":"box","text":"Market Risks/Recent Market Events","page_number":173,"box":{"x":116,"y":134,"width":283,"height":9}},{"id":"5ad754eb-94d8-4ba4-ad76-a1beea996823","block_type":"box","text":". Securities may decline in value due to factors affecting","page_number":173,"box":{"x":401,"y":134,"width":418,"height":12}},{"id":"4a827747-dd63-4c48-af6f-3c4ee466f8b1","block_type":"box","text":"securities markets generally or particular industries represented in the markets. The value of a security","page_number":173,"box":{"x":116,"y":149,"width":767,"height":12}},{"id":"ad9b7cd5-4fcd-4d0f-85dc-9ba4c0c829ab","block_type":"box","text":"may decline due to general market conditions, economic trends or events that are not specifically","page_number":173,"box":{"x":117,"y":165,"width":725,"height":12}},{"id":"7896ae9a-226c-483e-ba87-f8ff32ac5872","block_type":"box","text":"related to a company or to factors that affect a particular industry or industries, or factors that affect a","page_number":173,"box":{"x":117,"y":180,"width":754,"height":12}},{"id":"c23ed584-e403-4533-baa0-e70000d2f8c1","block_type":"box","text":"particular issuer or issuers, exchange, country, group of countries, region, market, industry, group of","page_number":173,"box":{"x":117,"y":196,"width":748,"height":12}},{"id":"45b7d4b8-8f10-4e3f-b8cf-8e72cfb158c8","block_type":"box","text":"industries, sector or asset class. The success of a Fund’s activities could be affected by interest rates,","page_number":173,"box":{"x":117,"y":211,"width":761,"height":12}},{"id":"34cadfbf-752b-4c7b-aee7-5aae38686aef","block_type":"box","text":"availability of credit, inflation rates, economic uncertainty, changes in laws, trade barriers, economic","page_number":173,"box":{"x":116,"y":227,"width":744,"height":12}},{"id":"33a8efcf-02d7-45e6-a4d6-a65715c73f69","block_type":"box","text":"sanctions, currency exchange controls, and local, regional or global events such as war, acts of","page_number":173,"box":{"x":116,"y":242,"width":714,"height":12}},{"id":"3df279af-866a-4cb8-bb5e-fa58db986a59","block_type":"box","text":"terrorism, natural and environmental disasters, the spread of infectious illness or other public health","page_number":173,"box":{"x":116,"y":258,"width":744,"height":11}},{"id":"27d2c742-1ca4-41cb-95d3-2bb5c8254fbf","block_type":"box","text":"issues, recessions, or other events could have a significant impact on a Fund and its investments.","page_number":173,"box":{"x":117,"y":273,"width":730,"height":12}},{"id":"cb212b11-292c-43cb-93f7-43dbd16b30d9","block_type":"box","text":"During a general economic downturn in the securities markets, multiple asset classes may be","page_number":173,"box":{"x":117,"y":289,"width":698,"height":12}},{"id":"cdcf7782-5067-4eb9-9444-814b49f18062","block_type":"box","text":"negatively affected. These factors may affect the level and volatility of securities prices and the liquidity","page_number":173,"box":{"x":117,"y":304,"width":768,"height":12}},{"id":"3241bb22-5e61-4a93-b5a5-777f3d43744b","block_type":"box","text":"of a Fund’s investments, which could impair the Fund’s profitability or result in losses. A Fund may","page_number":173,"box":{"x":116,"y":320,"width":734,"height":12}},{"id":"bfe137ff-8181-460e-ad61-f832aeca57b3","block_type":"box","text":"maintain substantial trading positions that can be adversely affected by the level of volatility in the","page_number":173,"box":{"x":117,"y":335,"width":728,"height":12}},{"id":"c5be66ce-f15a-428d-a7ec-4a89c4d96e74","block_type":"box","text":"financial markets; the larger the positions, the greater the potential for loss. Unpredictable or unstable","page_number":173,"box":{"x":116,"y":351,"width":758,"height":12}},{"id":"055de1b4-fbc6-4cd8-bf90-9a7c699ad29e","block_type":"box","text":"market conditions may result in reduced opportunities to find suitable investments to deploy capital or","page_number":173,"box":{"x":117,"y":366,"width":756,"height":12}},{"id":"4d41ac74-e4b4-4603-a5fe-186cbeac8407","block_type":"box","text":"make it more difficult to exit and realize value","page_number":173,"box":{"x":117,"y":382,"width":339,"height":9}},{"id":"f7a20cd3-aaf2-4a10-9cb1-3e4f3fecfdf7","block_type":"box","text":"from a Fund’s existing investments. It is important to","page_number":173,"box":{"x":456,"y":382,"width":394,"height":12}},{"id":"7e4f54b8-8ba7-4d3b-bb4f-0d96d5beeb1a","block_type":"box","text":"understand that a Fund can incur material losses even if it reacts quickly to difficult market conditions","page_number":173,"box":{"x":117,"y":397,"width":754,"height":12}},{"id":"fd16eb9f-495a-41b7-a9c8-ec278ae5819f","block_type":"box","text":"and there can be no assurance that a Fund will not suffer material adverse effects from broad and","page_number":173,"box":{"x":116,"y":413,"width":732,"height":9}},{"id":"e04ee91e-2f3e-43c5-8ccf-077850f8780f","block_type":"box","text":"rapid changes in market conditions.","page_number":173,"box":{"x":117,"y":428,"width":268,"height":12}},{"id":"68f236b2-2568-4c69-8b53-fee75a8546f7","block_type":"box","text":"Periods of unusually high volatility in the financial","page_number":173,"box":{"x":117,"y":459,"width":359,"height":12}},{"id":"06587274-fe75-42f5-8b47-4fec60a6bc70","block_type":"box","text":"markets and restrictive credit conditions, sometimes","page_number":173,"box":{"x":477,"y":459,"width":381,"height":11}},{"id":"5af958ff-9f59-41af-92af-40106005df54","block_type":"box","text":"limited to a particular sector or a geography, can o","page_number":173,"box":{"x":117,"y":475,"width":364,"height":12}},{"id":"a7381e7f-9a30-4204-ab85-686725228fee","block_type":"box","text":"ccur. Some countries, including the United States,","page_number":173,"box":{"x":482,"y":475,"width":368,"height":12}},{"id":"1445d550-c673-45d5-9d50-e6520014f89b","block_type":"box","text":"have adopted and/or are considering the adoption of more","page_number":173,"box":{"x":117,"y":490,"width":422,"height":12}},{"id":"c3f234c6-57fe-42c1-8825-a77feac32d6d","block_type":"box","text":"protectionist trade policies, a move away from","page_number":173,"box":{"x":539,"y":490,"width":344,"height":12}},{"id":"3c7f4dfe-6675-4087-be26-dab7dc7761f4","block_type":"box","text":"the tighter financial industry regulations that follow","page_number":173,"box":{"x":116,"y":506,"width":363,"height":12}},{"id":"6d1853fd-4cf5-48b1-bba8-7b95511f5b21","block_type":"box","text":"ed the financial crisis of","page_number":173,"box":{"x":480,"y":506,"width":174,"height":9}},{"id":"e36e8e11-8085-451a-b714-a4b684adbd02","block_type":"box","text":"2008, and/or substantially","page_number":173,"box":{"x":654,"y":506,"width":192,"height":12}},{"id":"e283b641-2f5f-4add-b8dd-63162fd95f72","block_type":"box","text":"reducing corporate taxes. The exact shape of these","page_number":173,"box":{"x":117,"y":521,"width":379,"height":12}},{"id":"bad64f06-dba3-42e9-a4eb-5c90479daa21","block_type":"box","text":"policies is still being considered, but the equity and","page_number":173,"box":{"x":497,"y":521,"width":372,"height":12}},{"id":"f00fa1cf-d927-4f86-b5e3-99013ed50125","block_type":"box","text":"debt markets may react strongly to expectations of c","page_number":173,"box":{"x":116,"y":537,"width":381,"height":12}},{"id":"9781524d-aca2-400f-ab9f-78ce57811982","block_type":"box","text":"hange, which could increase volatility, especially if","page_number":173,"box":{"x":498,"y":537,"width":367,"height":12}},{"id":"79376744-4564-40db-8078-82a852ad64aa","block_type":"box","text":"the market’s expectations are not borne out. A rise in","page_number":173,"box":{"x":116,"y":552,"width":384,"height":12}},{"id":"d5f27cbd-7bb4-4752-bcee-0ee53eb4d8e3","block_type":"box","text":"protectionist trade policies, and the possibility of","page_number":173,"box":{"x":501,"y":552,"width":357,"height":12}},{"id":"1ccccb3d-1551-4d34-ac4e-a74f93584a39","block_type":"box","text":"changes to some international trade agreements, coul","page_number":173,"box":{"x":116,"y":568,"width":392,"height":12}},{"id":"8ea11a16-b5c4-45f5-aa10-7fe4c0bf4d68","block_type":"box","text":"d affect the economies of many nations in ways","page_number":173,"box":{"x":509,"y":568,"width":350,"height":12}},{"id":"26c57657-fc49-4ec7-826f-2d03f3f23bc6","block_type":"box","text":"that cannot necessarily be foreseen at the present","page_number":173,"box":{"x":116,"y":583,"width":370,"height":12}},{"id":"fc2d0b43-2b6e-4c4f-9f9b-b04c5588dbbb","block_type":"box","text":"time. In addition, geopolitical and other risks, including","page_number":173,"box":{"x":486,"y":583,"width":398,"height":12}},{"id":"53ed9892-97d6-43f5-8864-e7e76c89f906","block_type":"box","text":"environmental and public health, may add to instability in world economies and markets generally.","page_number":173,"box":{"x":116,"y":599,"width":716,"height":12}},{"id":"f6d7c1e0-b5a3-42a1-825f-0289843420d4","block_type":"box","text":"Economies and financial markets throughout the world","page_number":173,"box":{"x":117,"y":614,"width":400,"height":12}},{"id":"d375a53b-085e-4cce-90b7-03368aa7f3a5","block_type":"box","text":"are increasingly interconnected. As a result,","page_number":173,"box":{"x":517,"y":614,"width":323,"height":12}},{"id":"e93f7ed6-14bb-4f31-84cc-fd47c1d9f27f","block_type":"box","text":"whether or not a Fund invests in securities of issuers","page_number":173,"box":{"x":116,"y":630,"width":388,"height":9}},{"id":"f979bf5d-6850-4a7b-8d43-9c4ef779eef3","block_type":"box","text":"located in or with significant exposure to countries","page_number":173,"box":{"x":504,"y":630,"width":367,"height":12}},{"id":"e92324d0-50ea-4af5-ac9f-a66ca6fd5607","block_type":"box","text":"experiencing economic, political and/or financial di","page_number":173,"box":{"x":116,"y":645,"width":364,"height":12}},{"id":"ce72dba0-d93d-4778-9c67-5c5d6c998cb8","block_type":"box","text":"fficulties, the value and liquidity of the Fund’s","page_number":173,"box":{"x":481,"y":645,"width":330,"height":12}},{"id":"270389c7-e404-46b6-a769-924bfff12bf9","block_type":"box","text":"investments may be negatively affected by such events.","page_number":173,"box":{"x":117,"y":661,"width":405,"height":12}},{"id":"766e7b77-008a-4937-a6bb-cd7876f671d1","block_type":"box","text":"Governments and regulators may take actions that affect the regulation of the Fund or the instruments","page_number":173,"box":{"x":117,"y":692,"width":757,"height":12}},{"id":"d2e21a2a-d711-4312-8afe-90ea6b0c82bf","block_type":"box","text":"in which the Fund invests, or the issuers of such instruments, in ways that are unforeseeable. Future","page_number":173,"box":{"x":117,"y":707,"width":745,"height":12}},{"id":"ebed9bbd-ab9e-44f6-a8ce-7e3af67a0a55","block_type":"box","text":"legislation or regulation or other governmental actions could limit or preclude the Fund’s abilities to","page_number":173,"box":{"x":117,"y":723,"width":729,"height":12}},{"id":"1fedd7d1-678d-4914-b5d8-50aeba108325","block_type":"box","text":"achieve its investment objectives or otherwise adversely impact an investment in the Fund. Recent","page_number":173,"box":{"x":116,"y":738,"width":733,"height":12}},{"id":"ae4accc7-d2bc-481c-93f2-9eedd54dfb91","block_type":"box","text":"policy initiatives undertaken by the U.S. government have the potential to impact international relations,","page_number":173,"box":{"x":117,"y":754,"width":764,"height":12}},{"id":"3cf1c368-4090-4ff7-9032-b5b9b2e7d072","block_type":"box","text":"trade agreements and the overall regulatory environment in ways that could create uncertainty and","page_number":173,"box":{"x":116,"y":769,"width":732,"height":12}},{"id":"742dcea4-4800-4fc6-ae7e-37522b462389","block_type":"box","text":"instability in domestic and global markets, and could adversely affect the investment performance of","page_number":173,"box":{"x":117,"y":785,"width":742,"height":12}},{"id":"8452a2d4-9930-482b-8fb7-a691c6898611","block_type":"box","text":"the Fund. In particular, actions taken by the U.S. government in respect of international trade relations","page_number":173,"box":{"x":116,"y":800,"width":757,"height":12}},{"id":"72e1b90a-6c2d-44dc-b0d7-8297cd6943e1","block_type":"box","text":"could lead to trade wars, increased costs for imported goods, disruptions in supply chains, reduced","page_number":173,"box":{"x":116,"y":816,"width":734,"height":12}},{"id":"b0f7dea9-2611-4847-b87b-db2c436dd630","block_type":"box","text":"foreign investment, and instability in regions where the Fund invests. Political and diplomatic events","page_number":173,"box":{"x":116,"y":831,"width":744,"height":12}},{"id":"ff0488e4-f5e5-4f02-ac27-a1eb7c547963","block_type":"box","text":"within the United States, including a contentious domestic political environment, changes in political","page_number":173,"box":{"x":116,"y":847,"width":743,"height":12}},{"id":"7dc032ca-de61-4d99-b943-8ce51ddb17d5","block_type":"box","text":"party control of one or more branches of the U.S. Government, the U.S. Government’s inability at times","page_number":173,"box":{"x":117,"y":862,"width":770,"height":12}},{"id":"5e461c09-9831-4f79-b86a-e124750183d9","block_type":"box","text":"to agree on a long-term budget and deficit reduction plan, the threat of a U.S. Government shutdown,","page_number":173,"box":{"x":116,"y":878,"width":757,"height":12}},{"id":"2daed22d-9c5b-44f5-ad70-d33a6e017119","block_type":"box","text":"II-86","page_number":173,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"8ef83814-71f5-473a-babd-9d7310af0160","block_type":"box","text":"NM1026U-6004382-173/605","page_number":173,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6b625003-7f50-4d28-9845-193403094142","block_type":"box","text":"and disagreements over, or threats not to increase, the U.S. Government’s borrowing limit (or “debt","page_number":174,"box":{"x":116,"y":87,"width":742,"height":12}},{"id":"99441177-d7ec-4236-9248-8d687d9447fc","block_type":"box","text":"ceiling”), as well as political and diplomatic events abroad, may affect investor and consumer","page_number":174,"box":{"x":116,"y":102,"width":694,"height":13}},{"id":"2f3725cc-1612-41c9-881f-133d16f7da18","block_type":"box","text":"confidence and may adversely impact financial markets and the broader economy, perhaps suddenly","page_number":174,"box":{"x":116,"y":118,"width":756,"height":12}},{"id":"f17e3bd6-1585-4451-a770-480a6a6176f8","block_type":"box","text":"and to a significant degree. A downgrade of the ratings of U.S. Government debt obligations, or","page_number":174,"box":{"x":116,"y":134,"width":713,"height":12}},{"id":"27bb4582-05d3-4810-83bd-880fca943f8c","block_type":"box","text":"concerns about the U.S. Government’s credit quality in general, could have a substantial negative","page_number":174,"box":{"x":116,"y":149,"width":730,"height":12}},{"id":"89579eb6-24f0-4d2b-94e7-aa0ee641e43e","block_type":"box","text":"effect on the U.S. and global economies. For example, concerns about the U.S. Government’s credit","page_number":174,"box":{"x":116,"y":165,"width":751,"height":12}},{"id":"c56a5107-88d6-4d85-9a28-4964ecf7d048","block_type":"box","text":"quality may cause increased volatility in the stock and bond markets, higher interest rates, reduced","page_number":174,"box":{"x":116,"y":180,"width":739,"height":12}},{"id":"04129bdd-017c-4361-bf8e-a98c3e4e7832","block_type":"box","text":"prices and liquidity of U.S. Treasury securities, and/or increased costs of various kinds of debt.","page_number":174,"box":{"x":117,"y":196,"width":706,"height":12}},{"id":"6c1bdfd4-a555-45e3-aa63-934c7af3022e","block_type":"box","text":"Moreover, although the U.S. Government has honored its credit obligations, there remains a possibility","page_number":174,"box":{"x":117,"y":211,"width":766,"height":12}},{"id":"e3194840-2f71-41f5-8f91-35fae3a3bb6f","block_type":"box","text":"that the United States could default on its obligations. The consequences of such an unprecedented","page_number":174,"box":{"x":116,"y":227,"width":747,"height":12}},{"id":"f103d254-f68f-4435-a055-a005ed3098ad","block_type":"box","text":"event are impossible to predict, but it is likely that a default by the United States would be highly","page_number":174,"box":{"x":116,"y":242,"width":716,"height":12}},{"id":"a02943b2-663e-43df-833e-0ac0c87ef01e","block_type":"box","text":"disruptive to the U.S. and global securities markets and could significantly impair the value of the","page_number":174,"box":{"x":116,"y":258,"width":723,"height":12}},{"id":"d45ebe04-9b8c-4aa2-bbc4-dab825991796","block_type":"box","text":"Fund’s investments.","page_number":174,"box":{"x":117,"y":273,"width":153,"height":10}},{"id":"923ca971-42be-4223-afb3-1bf9df37277c","block_type":"box","text":"The COVID-19 pandemic resulted in significant market volatility, exchange suspensions and closures,","page_number":174,"box":{"x":116,"y":300,"width":761,"height":12}},{"id":"04f6ea40-57d6-485a-af2c-ce2feca450f0","block_type":"box","text":"declines in global financial markets, higher default rates, supply chain disruptions, and a substantial","page_number":174,"box":{"x":116,"y":316,"width":743,"height":12}},{"id":"5f51f92c-1d9f-4bb9-ad40-0f20269c6175","block_type":"box","text":"economic downturn in economies throughout the world. The impact of this coronavirus, and other","page_number":174,"box":{"x":116,"y":331,"width":727,"height":12}},{"id":"06d1f2aa-6a6d-4327-b532-c6b3364b9c33","block_type":"box","text":"epidemics and pandemics that may arise in the future, could affect the economies of many nations,","page_number":174,"box":{"x":116,"y":347,"width":741,"height":12}},{"id":"c74785df-0764-4697-89f6-fe559e897dee","block_type":"box","text":"individual companies and the market in general in ways that cannot necessarily be foreseen at the","page_number":174,"box":{"x":117,"y":362,"width":733,"height":12}},{"id":"6a852922-5148-4e2d-967b-8ddb36ee1ef9","block_type":"box","text":"present time. These health crises may be short term or long term, and may exacerbate other pre","page_number":174,"box":{"x":117,"y":378,"width":721,"height":12}},{"id":"7aebc4b9-791d-4f1d-b528-666decece1d5","block_type":"box","text":"existing political, social and economic risks, disrupt normal market conditions and operations, and","page_number":174,"box":{"x":116,"y":393,"width":729,"height":12}},{"id":"d3caf265-e910-4cd0-8df1-bf193eabfebd","block_type":"box","text":"negatively impact performance. In addition, the impact of infectious diseases in emerging developing or","page_number":174,"box":{"x":117,"y":409,"width":771,"height":12}},{"id":"c05b85b4-1d73-4ec4-b013-09032915983b","block_type":"box","text":"emerging market countries may be greater due to less established health care systems.","page_number":174,"box":{"x":116,"y":424,"width":657,"height":12}},{"id":"aaa81c28-b622-431a-8e52-58742b395316","block_type":"box","text":"Legal and Regulatory Risks","page_number":174,"box":{"x":116,"y":451,"width":205,"height":12}},{"id":"47d2dc16-6d3a-47bd-98e8-b8059557048b","block_type":"box","text":". The Manager is part of a larger firm with multiple business lines active in","page_number":174,"box":{"x":323,"y":451,"width":550,"height":12}},{"id":"145cdf24-23ac-4556-b742-c15392f82d3f","block_type":"box","text":"multiple jurisdictions that are governed by a multitude of legal systems and regulatory regimes, some","page_number":174,"box":{"x":117,"y":467,"width":753,"height":12}},{"id":"4e93c803-4561-4d4a-9b11-8738dbca9fff","block_type":"box","text":"of which are new and evolving. As a result, the Funds and the Manager and its affiliates are subject to","page_number":174,"box":{"x":116,"y":482,"width":761,"height":12}},{"id":"0e6ca4d5-8e40-4975-8190-6d7aa1ebd188","block_type":"box","text":"extensive and sophisticated legal, tax and regulatory risks, including changing laws and regulations,","page_number":174,"box":{"x":116,"y":498,"width":746,"height":12}},{"id":"26363556-274f-4aaa-87cd-05435f137b48","block_type":"box","text":"developing interpretations of such laws and regulations, as well as existing laws, and increased","page_number":174,"box":{"x":116,"y":513,"width":712,"height":12}},{"id":"d0adb54d-6094-472c-a93e-ac3158c565a7","block_type":"box","text":"scrutiny by regulators and law enforcement authorities. Unexpected economic, political, regulatory and","page_number":174,"box":{"x":116,"y":529,"width":766,"height":12}},{"id":"330b12ce-d72d-4bb0-bb43-0ebc0f28e4bd","block_type":"box","text":"diplomatic events within the United States and abroad can trigger new and complex regulations that","page_number":174,"box":{"x":116,"y":544,"width":745,"height":12}},{"id":"8b500c25-7354-4275-a299-9896cc16e3fa","block_type":"box","text":"the Manager and/or the Funds may need to comply with. The implementation of changes to comply","page_number":174,"box":{"x":116,"y":560,"width":742,"height":12}},{"id":"c481bebf-4d91-44da-bfbc-0f9b38fcf00d","block_type":"box","text":"with current and/or new regulations applicable to the Funds and/or the Manager could have a material","page_number":174,"box":{"x":116,"y":576,"width":761,"height":11}},{"id":"397b8f83-fa76-4d66-a0bc-c90cc319655f","block_type":"box","text":"adverse effect on the Funds (including by imposing material costs on the Funds, reducing profit","page_number":174,"box":{"x":116,"y":591,"width":712,"height":12}},{"id":"cd774e39-487e-4da4-96da-f92fa3d007b5","block_type":"box","text":"margins, reducing investment opportunities or by otherwise restricting the Funds and/or the Manager).","page_number":174,"box":{"x":117,"y":606,"width":762,"height":12}},{"id":"8fa8f10b-f2c7-460e-93e7-dee4726375d6","block_type":"box","text":"Tariff and Trade Policy Risks","page_number":174,"box":{"x":118,"y":634,"width":213,"height":12}},{"id":"1dae0fcb-f1c1-4d69-96f7-9fc5fa94488a","block_type":"box","text":". Some countries, including the U.S., have adopted more protectionist","page_number":174,"box":{"x":332,"y":634,"width":521,"height":12}},{"id":"fe29bd6a-8f6f-4df2-83ae-080f82d9459c","block_type":"box","text":"trade policies. The U.S. government recently altered its approach to international trade policy, resulting","page_number":174,"box":{"x":116,"y":649,"width":768,"height":12}},{"id":"5508c05f-1530-4222-a713-9bdbaf992666","block_type":"box","text":"in significant impacts on international trade relations, certain tax and immigration policies, and other","page_number":174,"box":{"x":117,"y":665,"width":738,"height":12}},{"id":"2634890e-ffd2-417c-a190-ba91df73494c","block_type":"box","text":"aspects of the national and international political and financial landscape. The rise in protectionist trade","page_number":174,"box":{"x":116,"y":680,"width":764,"height":12}},{"id":"ac176776-34fa-42d0-ac5d-21d0fb350b5c","block_type":"box","text":"policies, slowing economic growth, changes to some major international trade agreements, risks","page_number":174,"box":{"x":117,"y":696,"width":713,"height":12}},{"id":"2a3c7cbb-dc9b-4383-94c0-dc851d7a27c0","block_type":"box","text":"associated with trade agreements between the U.S. and the European Union, and the risks associated","page_number":174,"box":{"x":116,"y":711,"width":761,"height":12}},{"id":"8306dd3b-c84c-4c65-b7d8-0855c38112f1","block_type":"box","text":"with trade negotiations between the U.S. and China, could affect the economies of many nations in","page_number":174,"box":{"x":116,"y":727,"width":733,"height":12}},{"id":"47ce05eb-780b-4abd-a6f2-8d2668d54a7f","block_type":"box","text":"ways that cannot necessarily be foreseen at the present time.","page_number":174,"box":{"x":116,"y":742,"width":456,"height":12}},{"id":"e4a6ad06-7406-415a-b767-aca04f20b232","block_type":"box","text":"Global trade disruption, significant introductions of trade barriers, and bilateral trade frictions, together","page_number":174,"box":{"x":117,"y":769,"width":754,"height":12}},{"id":"d44cb046-0606-4bde-9a51-53be08eef4ee","block_type":"box","text":"with any future downturns in the global economy resulting therefrom, could adversely affect the","page_number":174,"box":{"x":116,"y":785,"width":705,"height":12}},{"id":"55b2471d-8dbe-4763-be66-c883e30d6abf","block_type":"box","text":"financial performance of a Fund and its investments. Trade policy may be an ongoing source of","page_number":174,"box":{"x":116,"y":800,"width":709,"height":12}},{"id":"ff9b39ac-01ec-4057-a267-425eccb3f5c6","block_type":"box","text":"instability, potentially resulting in significant currency fluctuations and/or having other adverse effects","page_number":174,"box":{"x":117,"y":816,"width":745,"height":12}},{"id":"a88dd7fd-eb3d-43d4-84e8-2d3ef1c82618","block_type":"box","text":"on international markets, international trade agreements, and/or other existing cross-border","page_number":174,"box":{"x":116,"y":831,"width":683,"height":12}},{"id":"bf60a533-dafe-4ae6-abca-74dd7b1273f3","block_type":"box","text":"cooperation arrangements (whether economic, tax, fiscal, legal, regulatory, or otherwise). To the extent","page_number":174,"box":{"x":116,"y":847,"width":771,"height":12}},{"id":"674e93c7-2a97-466f-9468-b14e23a1a65c","block_type":"box","text":"trade disputes escalate globally, there could be additional significant impacts on the sectors or","page_number":174,"box":{"x":116,"y":862,"width":704,"height":12}},{"id":"88065828-7d7d-41f6-a1db-a781e488bc0e","block_type":"box","text":"industries in which a Fund invests and other adverse impacts on a Fund’s overall performance.","page_number":174,"box":{"x":117,"y":878,"width":709,"height":12}},{"id":"0e3eca67-bd6c-4a49-8fc8-71f5fb03ad7e","block_type":"box","text":"II-87","page_number":174,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"f0f181db-ca35-444d-9f07-e74de0f4cf0c","block_type":"box","text":"NM1026U-6004382-174/605","page_number":174,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ef08bcc8-0720-4f24-806c-8fe7a2a98dfe","block_type":"box","text":"Geographic Risks","page_number":175,"box":{"x":117,"y":87,"width":131,"height":12}},{"id":"a792a82c-c0f4-41da-a24c-6ccee5b67fff","block_type":"box","text":". Some of the companies in which the Fund invests may be located in, or otherwise","page_number":175,"box":{"x":250,"y":87,"width":621,"height":12}},{"id":"712a9729-e357-43a0-b0e1-278bc5c34cbd","block_type":"box","text":"connected to, parts of the world affected by natural disasters such as severe heat, earthquakes,","page_number":175,"box":{"x":116,"y":102,"width":717,"height":13}},{"id":"160f159f-de70-4808-93a4-fbeee5813d80","block_type":"box","text":"tornadoes, volcanic eruptions, wildfires, droughts, floods, hurricanes or tsunamis, and are economically","page_number":175,"box":{"x":116,"y":118,"width":771,"height":12}},{"id":"2797b3cc-8566-4073-88c9-37e99cb44bca","block_type":"box","text":"sensitive to environmental events. In addition, issuers may be impacted by security concerns with","page_number":175,"box":{"x":116,"y":134,"width":729,"height":12}},{"id":"5e23dbcd-509b-4d24-b48c-d3dbc44f8049","block_type":"box","text":"respect to a country or region, such as war and other types of conflict, terrorism, strained international","page_number":175,"box":{"x":117,"y":149,"width":760,"height":12}},{"id":"664b3987-c036-4d1f-8a4c-0ff030002f3b","block_type":"box","text":"relations and territorial disputes. Any of these events may adversely affect the issuers, markets and","page_number":175,"box":{"x":117,"y":165,"width":742,"height":12}},{"id":"571e7824-eff7-476f-b2fd-57a98e2c4010","block_type":"box","text":"economies to which a Fund is exposed, which may adversely affect the value of the Fund.","page_number":175,"box":{"x":116,"y":180,"width":673,"height":12}},{"id":"9e9393cc-3b61-4805-827a-77bdf8717ca8","block_type":"box","text":"Reference Rate Replacement Risk.","page_number":175,"box":{"x":116,"y":211,"width":275,"height":12}},{"id":"478b5c7b-63e4-43db-807b-c0fd965401ed","block_type":"box","text":"The London Interbank Offered Rate (“LIBOR”) had historically","page_number":175,"box":{"x":393,"y":211,"width":469,"height":12}},{"id":"5172cf8c-7518-4f74-8626-16ae34086c5a","block_type":"box","text":"been used extensively in the U.S. and globally as a “benchmark” or “reference rate” for various","page_number":175,"box":{"x":117,"y":227,"width":707,"height":12}},{"id":"0cd6b8c4-89f8-4e86-87fc-59a5c924f463","block_type":"box","text":"commercial and financial contracts, including corporate and municipal bonds, bank loans, asset","page_number":175,"box":{"x":116,"y":242,"width":714,"height":12}},{"id":"529812f5-1e52-4cad-8aa9-264b12b2da8c","block_type":"box","text":"backed and mortgage-related securities, interest rate swaps and other derivatives. Instruments in","page_number":175,"box":{"x":117,"y":258,"width":726,"height":12}},{"id":"8aa2b792-fff6-4d7d-bdc5-7ceda69d08b3","block_type":"box","text":"which a Fund may have historically paid interest at floating rates based on LIBOR or may have been","page_number":175,"box":{"x":116,"y":273,"width":750,"height":12}},{"id":"8cf2e0b6-ddf9-4ce6-a32f-ac271081f146","block_type":"box","text":"subject to interest caps or floors based on LIBOR. The Funds and issuers of instruments in which a","page_number":175,"box":{"x":116,"y":289,"width":742,"height":12}},{"id":"8108cadf-1f34-456b-932d-31171d5d339a","block_type":"box","text":"Fund invests may have also historically obtained financing at floating rates based on LIBOR. In","page_number":175,"box":{"x":117,"y":304,"width":709,"height":12}},{"id":"58cf4802-5647-4fdb-8680-f22ed36a8c48","block_type":"box","text":"connection with the global transition away from LIBOR led by regulators and market participants as a","page_number":175,"box":{"x":116,"y":320,"width":754,"height":12}},{"id":"1d57be03-72e5-4ebb-80f6-8cdb76681369","block_type":"box","text":"result of benchmark reforms, LIBOR was last published on a representative basis at the end of June","page_number":175,"box":{"x":117,"y":335,"width":748,"height":12}},{"id":"50a02b4c-c6d9-46b5-b1b6-258a9ea5c24f","block_type":"box","text":"2023. Alternative reference rates to LIBOR have been established in most major currencies and","page_number":175,"box":{"x":116,"y":351,"width":717,"height":12}},{"id":"0f9084ff-37c7-415f-a453-4c04c58212be","block_type":"box","text":"markets in these alternative rates are continuing to develop (","page_number":175,"box":{"x":117,"y":366,"width":449,"height":12}},{"id":"af2be05c-1994-4d82-a17e-2ada69010fc0","block_type":"box","text":"e.g.","page_number":175,"box":{"x":568,"y":369,"width":25,"height":9}},{"id":"93253b7b-452c-45e5-adbe-a7092766e0e0","block_type":"box","text":", the Secured Overnight Financing","page_number":175,"box":{"x":596,"y":366,"width":259,"height":12}},{"id":"1789cad2-b9e0-43d5-af0d-cb4274926305","block_type":"box","text":"Rate (“SOFR”) for USD-LIBOR). While the transition from LIBOR has gone relatively smoothly, residual","page_number":175,"box":{"x":117,"y":382,"width":771,"height":12}},{"id":"404f75e1-3101-4535-8e86-7199ccd2bca6","block_type":"box","text":"risks associated with the transition may remain that may impact markets or particular investments and,","page_number":175,"box":{"x":117,"y":397,"width":765,"height":12}},{"id":"44a44125-8860-49f1-affd-8984a8e5302c","block_type":"box","text":"as such, the full impact of the transition on the Funds or the financial instruments in which the Funds","page_number":175,"box":{"x":116,"y":413,"width":749,"height":12}},{"id":"b08e2827-6f6b-472b-97ac-edeec7bdc28f","block_type":"box","text":"invest cannot yet be fully determined.","page_number":175,"box":{"x":117,"y":428,"width":281,"height":12}},{"id":"7e3759c8-d896-4f26-8bdb-2d217a089504","block_type":"box","text":"SOFR is intended to be a broad measure of the cost of","page_number":175,"box":{"x":116,"y":459,"width":400,"height":10}},{"id":"d382539c-2337-4a1c-a26c-538094cd5d7e","block_type":"box","text":"f borrowing funds overnight in transactions that are","page_number":175,"box":{"x":515,"y":459,"width":370,"height":12}},{"id":"cadf520a-e53d-45e2-bf63-aa99c6a4f7ad","block_type":"box","text":"collateralized by U.S. Treasury securities . SOFR","page_number":175,"box":{"x":116,"y":475,"width":357,"height":12}},{"id":"7905f553-80aa-4eba-817e-d7f0ce53bd8b","block_type":"box","text":"R is calculated based on transaction-level repo data","page_number":175,"box":{"x":473,"y":475,"width":370,"height":12}},{"id":"82559914-5a0a-4591-a239-d62a4e8d1121","block_type":"box","text":"collected from various sources. For each trading day,","page_number":175,"box":{"x":116,"y":490,"width":391,"height":12}},{"id":"9d8d65ef-50da-40f8-ad43-30bb3d52423f","block_type":"box","text":"SOFR is calculated as a volume-weighted median","page_number":175,"box":{"x":508,"y":490,"width":368,"height":12}},{"id":"3c2de9c0-5d19-4422-a26f-8d3580677e0c","block_type":"box","text":"rate derived from such data. Because SOFR is a financing rate based on overnight secured funding","page_number":175,"box":{"x":117,"y":506,"width":728,"height":12}},{"id":"849f34b2-a2db-4cf5-974e-748c2fbc80cd","block_type":"box","text":"transactions, it differs fundamentally from LIBOR.","page_number":175,"box":{"x":116,"y":521,"width":357,"height":12}},{"id":"71296d64-8619-41ec-b701-6d3e5edfa4a4","block_type":"box","text":"LIBOR is intended to be an unsecured rate that","page_number":175,"box":{"x":474,"y":521,"width":354,"height":10}},{"id":"5e45e0fb-4784-4ef8-808d-2916fc4b3e53","block_type":"box","text":"represents interbank funding costs for different short-term","page_number":175,"box":{"x":117,"y":537,"width":422,"height":12}},{"id":"15862c4d-21dd-4194-bf02-f277d2b80ee9","block_type":"box","text":"maturities or tenors. It is a forward-looking rate","page_number":175,"box":{"x":540,"y":537,"width":343,"height":12}},{"id":"d1abacfa-36de-48ed-b1fd-19b8593c0100","block_type":"box","text":"reflecting expectations regarding interest rates for the applicable tenor. Thus, LIBOR is intended to be","page_number":175,"box":{"x":117,"y":552,"width":742,"height":12}},{"id":"e6cc0fbd-3bb5-4836-82f8-255106dfbc92","block_type":"box","text":"sensitive, in certain respects, to bank credit risk and to","page_number":175,"box":{"x":116,"y":568,"width":394,"height":12}},{"id":"045e232f-7071-49ea-9df3-d4d1e84e222c","block_type":"box","text":"term interest rate risk.","page_number":175,"box":{"x":510,"y":568,"width":169,"height":9}},{"id":"857f13aa-7f3c-4fab-b6d0-878a05fbea9a","block_type":"box","text":"In contrast, SOFR is a","page_number":175,"box":{"x":680,"y":568,"width":165,"height":11}},{"id":"e2287311-6977-45bc-bfa3-6880a2521ac6","block_type":"box","text":"secured overnight rate reflecting the credit of U.S. Tr","page_number":175,"box":{"x":116,"y":583,"width":382,"height":12}},{"id":"474eaa84-6c76-4332-bfb4-8d6f7b18f7b2","block_type":"box","text":"easury securities as collateral. Thus, it is largely","page_number":175,"box":{"x":498,"y":583,"width":352,"height":12}},{"id":"07c82e70-9f63-46bc-8219-84c85b9ad414","block_type":"box","text":"insensitive to credit-risk considerations and to short-te","page_number":175,"box":{"x":117,"y":599,"width":390,"height":9}},{"id":"8645bb45-7ba2-4d94-b1e3-dd3ea0beadb9","block_type":"box","text":"rm interest rate risks. SOFR is a transaction-based","page_number":175,"box":{"x":509,"y":599,"width":373,"height":9}},{"id":"94cd78e0-7650-4ff2-918b-969ec6a2bc80","block_type":"box","text":"rate, and it has been more volatile than other benchmark","page_number":175,"box":{"x":117,"y":614,"width":416,"height":11}},{"id":"f6b1b5c7-2374-46fc-97de-7ad4b9bfc1c8","block_type":"box","text":"or market rates, such as three-month LIBOR,","page_number":175,"box":{"x":534,"y":614,"width":333,"height":11}},{"id":"e24998d1-3e92-45fb-ba1a-d2f7907e407e","block_type":"box","text":"during certain periods. For these reasons, among other","page_number":175,"box":{"x":116,"y":630,"width":402,"height":12}},{"id":"ac79c7c7-0d16-48f9-90c3-970c957ade2d","block_type":"box","text":"s, there is no assurance that SOFR, or rates","page_number":175,"box":{"x":518,"y":630,"width":326,"height":11}},{"id":"c3df6e84-f3ff-49c5-86ee-7ef8b1163469","block_type":"box","text":"derived from SOFR, will perform in the same or simila","page_number":175,"box":{"x":116,"y":645,"width":390,"height":12}},{"id":"e39da49e-a801-47d2-9f6b-f61b181fb726","block_type":"box","text":"r way as LIBOR would have performed at any time,","page_number":175,"box":{"x":507,"y":645,"width":377,"height":12}},{"id":"f798a454-128e-4c16-88e3-badd0bb9f489","block_type":"box","text":"and there is no assurance that SOFR-based rates will","page_number":175,"box":{"x":116,"y":661,"width":389,"height":9}},{"id":"87502076-2c44-48f4-9401-91ff3db35b22","block_type":"box","text":"be a suitable substitute for LIBOR. SOFR has a","page_number":175,"box":{"x":512,"y":661,"width":345,"height":9}},{"id":"a4cee106-717c-4be2-9cb3-d25ba1020ddc","block_type":"box","text":"relatively limited history, having been first published","page_number":175,"box":{"x":117,"y":676,"width":372,"height":12}},{"id":"a4d04df0-2043-4a47-a041-1a5c827571ae","block_type":"box","text":"in April 2018. The future performance of SOFR, and","page_number":175,"box":{"x":495,"y":676,"width":377,"height":12}},{"id":"3312ba5c-64b6-411d-8009-c31cdeb2df91","block_type":"box","text":"SOFR-based reference rates, cannot be predicted bas","page_number":175,"box":{"x":116,"y":692,"width":396,"height":12}},{"id":"326761c7-5b7b-4c0e-96db-9f86e910d283","block_type":"box","text":"ed on SOFR’s history or otherwise. Levels of","page_number":175,"box":{"x":513,"y":692,"width":326,"height":12}},{"id":"85343d4e-c5c7-498b-b714-5e64a03699f2","block_type":"box","text":"SOFR in the future may bear little or no relation to hi","page_number":175,"box":{"x":116,"y":707,"width":379,"height":12}},{"id":"60b88efb-1348-4e6b-87d7-25b0f94a21a7","block_type":"box","text":"storical levels of SOFR,","page_number":175,"box":{"x":496,"y":707,"width":170,"height":11}},{"id":"c38d29fe-5966-4b3d-9481-83ef4cc3512e","block_type":"box","text":"LIBOR or other rates. There","page_number":175,"box":{"x":673,"y":707,"width":203,"height":10}},{"id":"242e68ba-c9ce-4eb3-ad2b-4deda51217f4","block_type":"box","text":"can also be no assurance that SOFR will not be discont","page_number":175,"box":{"x":116,"y":723,"width":404,"height":9}},{"id":"06336950-60fa-490b-8160-29754f3f454e","block_type":"box","text":"inued or fundamentally alter","page_number":175,"box":{"x":521,"y":723,"width":202,"height":12}},{"id":"1458dbf5-1b2d-4256-9acd-a5bc58fdd6e8","block_type":"box","text":"ed in a manner that is","page_number":175,"box":{"x":724,"y":723,"width":157,"height":9}},{"id":"3a4b9872-afa1-4011-8219-4aeafaa19879","block_type":"box","text":"materially adverse to the interests of the Fund.","page_number":175,"box":{"x":117,"y":738,"width":336,"height":12}},{"id":"589c1ae4-5cec-4fc1-9e67-7f1863c3bce2","block_type":"box","text":"In addition, interest rates or other types of rates and indices which are classified as “benchmarks” have","page_number":175,"box":{"x":117,"y":769,"width":763,"height":12}},{"id":"cd31ca82-a002-4e1f-84a0-e55e659dae5e","block_type":"box","text":"been the subject of ongoing national and international regulatory reform, including under the European","page_number":175,"box":{"x":117,"y":785,"width":759,"height":12}},{"id":"cc618b4d-af7c-4431-8452-fc4e06c538de","block_type":"box","text":"Union (“EU”) regulation on indices used as benchmarks in financial instruments and financial contracts","page_number":175,"box":{"x":117,"y":800,"width":759,"height":12}},{"id":"d04a6201-6e52-4173-95ec-8fc8c1d1e567","block_type":"box","text":"(known as the “Benchmarks Regulation”). The Benchmarks Regulation has been enacted into United","page_number":175,"box":{"x":117,"y":816,"width":748,"height":12}},{"id":"7cc2ffa5-3238-4ce7-a28b-9a85a3ee1c61","block_type":"box","text":"Kingdom (“UK”) law by virtue of the EU (Withdrawal) Act 2018 (as amended), subject to amendments","page_number":175,"box":{"x":117,"y":831,"width":756,"height":12}},{"id":"8a634bf5-64dd-4874-9027-039058710d08","block_type":"box","text":"made by the Benchmarks (Amendment and Transitional Provision) (EU Exit) Regulations 2019 (SI","page_number":175,"box":{"x":117,"y":847,"width":733,"height":12}},{"id":"d40e1b3b-9968-4cf6-b327-8229265a65fd","block_type":"box","text":"2019/657) and other statutory instruments. Following the implementation of these reforms, the manner","page_number":175,"box":{"x":116,"y":862,"width":765,"height":12}},{"id":"9bd7857d-c229-4d92-bc9e-3b16ae746598","block_type":"box","text":"of administration of benchmarks has changed and may further change in the future, with the result that","page_number":175,"box":{"x":116,"y":878,"width":766,"height":12}},{"id":"9bda1d1b-f62f-46a8-bdb0-6d33103f23ea","block_type":"box","text":"II-88","page_number":175,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"02d333c9-c488-40d4-909a-66c19597b78b","block_type":"box","text":"NM1026U-6004382-175/605","page_number":175,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a4a36dfd-f10a-4830-9a94-4b90471d2c66","block_type":"box","text":"relevant benchmarks may perform differently than in the past, the use of benchmarks that are not","page_number":176,"box":{"x":117,"y":87,"width":726,"height":12}},{"id":"0d22f1de-0471-4482-95db-44b38dbd8add","block_type":"box","text":"compliant with the new standards by certain supervised entities may be restricted, and certain","page_number":176,"box":{"x":116,"y":103,"width":702,"height":12}},{"id":"6fb9f02f-2bee-4275-adcf-b36880df03e0","block_type":"box","text":"benchmarks may be eliminated entirely. Such changes could cause increased market volatility and","page_number":176,"box":{"x":117,"y":118,"width":737,"height":12}},{"id":"0e12485b-4804-4e3c-b07e-96af7a0a886d","block_type":"box","text":"disruptions in liquidity for instruments that rely on or are impacted by such benchmarks. Additionally,","page_number":176,"box":{"x":116,"y":134,"width":749,"height":12}},{"id":"305dc87e-3df5-4c72-b9a7-82ba31851217","block_type":"box","text":"there could be other consequences which cannot be predicted.","page_number":176,"box":{"x":116,"y":149,"width":472,"height":12}},{"id":"06a5748f-d888-4df4-a2e0-aef40b1d054e","block_type":"box","text":"Repurchase Agreements and Purchase and Sale Contracts.","page_number":176,"box":{"x":116,"y":179,"width":479,"height":12}},{"id":"dd7d835f-89c2-4e73-979e-af08a4025e1d","block_type":"box","text":"Under repurchase agreements and","page_number":176,"box":{"x":597,"y":180,"width":264,"height":11}},{"id":"323e252b-75d1-4140-92db-b277f4cac5e4","block_type":"box","text":"purchase and sale contracts, the other party agrees, upon entering into the contract with a Fund, to","page_number":176,"box":{"x":117,"y":194,"width":740,"height":12}},{"id":"298bc139-235f-4faf-8bb1-8d24a1f2c402","block_type":"box","text":"repurchase a security sold to the Fund at a mutually agreed-upon time and price in a specified","page_number":176,"box":{"x":117,"y":209,"width":703,"height":12}},{"id":"8ab85be5-3bbc-41fa-9b1b-a62a7ecf207c","block_type":"box","text":"currency, thereby determining the yield during the term of the agreement.","page_number":176,"box":{"x":116,"y":224,"width":549,"height":12}},{"id":"c61fcf9b-9c27-4cc6-a255-e4a350b27d7e","block_type":"box","text":"A purchase and sale contract differs from a repurchase agreement in that the contract arrangements","page_number":176,"box":{"x":116,"y":254,"width":751,"height":12}},{"id":"834937dc-22ce-4a10-aaf5-4bc684ea0e79","block_type":"box","text":"stipulate that securities are owned by the Fund and the purchaser receives any interest on the security","page_number":176,"box":{"x":116,"y":269,"width":766,"height":12}},{"id":"43d826e6-9770-4dfa-ae1e-7b9d1b0d3b1c","block_type":"box","text":"paid during the period. In the case of repurchase agreements, the prices at which the trades are","page_number":176,"box":{"x":117,"y":284,"width":717,"height":12}},{"id":"23a77f39-4de3-47dc-a7aa-d5dc4e3136da","block_type":"box","text":"conducted do not reflect accrued interest on the underlying obligation; whereas, in the case of","page_number":176,"box":{"x":116,"y":299,"width":701,"height":12}},{"id":"28e862a2-870d-4a1c-bdf0-2fd13a7851ca","block_type":"box","text":"purchase and sale contracts, the prices take into account accrued interest. A Fund may enter into","page_number":176,"box":{"x":117,"y":314,"width":728,"height":12}},{"id":"ac235834-288e-42ae-9ea7-af3f12fe7d17","block_type":"box","text":"“tri-party” repurchase agreements. In “tri-party” repurchase agreements, an unaffiliated third-party","page_number":176,"box":{"x":116,"y":329,"width":729,"height":12}},{"id":"5e972c01-b112-4dc6-ace3-9efe4b5fcdbd","block_type":"box","text":"custodian maintains accounts to hold collateral for the Fund and its counterparties and, therefore, the","page_number":176,"box":{"x":116,"y":343,"width":756,"height":12}},{"id":"a8670782-6d5f-4ccb-9a69-49269504b1d3","block_type":"box","text":"Fund may be subject to the credit risk of those custodians.","page_number":176,"box":{"x":117,"y":358,"width":438,"height":12}},{"id":"d77021d1-d78b-40c3-a07b-3f87bda8da5c","block_type":"box","text":"Some repurchase agreements and purchase and sale contracts are structured to result in a fixed rate","page_number":176,"box":{"x":116,"y":389,"width":758,"height":12}},{"id":"b739e3ba-5483-4813-8222-fdc1d193ec64","block_type":"box","text":"of return insulated from market fluctuations during the term of the agreement, although such return","page_number":176,"box":{"x":116,"y":405,"width":737,"height":12}},{"id":"5ed3db56-6f70-4116-8e84-c3040d537a4e","block_type":"box","text":"may be affected by currency fluctuations. However, in the event of a default under a repurchase","page_number":176,"box":{"x":117,"y":420,"width":716,"height":12}},{"id":"7f392a8e-1cd8-4943-8776-71ba7eb692f3","block_type":"box","text":"agreement or under a purchase and sale contract, instead of the contractual fixed rate, the rate of","page_number":176,"box":{"x":116,"y":436,"width":730,"height":12}},{"id":"8b9ecde6-80a4-455a-8c20-0f4e31ea60ee","block_type":"box","text":"return to the Fund would be dependent upon intervening fluctuations of the market values of the","page_number":176,"box":{"x":117,"y":451,"width":716,"height":12}},{"id":"64b8c1a5-ff2a-4a8b-a0e6-4a2527237973","block_type":"box","text":"securities underlying the contract and the accrued interest on those securities. In such event, the Fund","page_number":176,"box":{"x":116,"y":467,"width":766,"height":12}},{"id":"e06bb787-2c20-43e3-8eeb-1395c3fe453e","block_type":"box","text":"would have rights against the seller for breach of contract with respect to any losses arising from","page_number":176,"box":{"x":116,"y":482,"width":721,"height":12}},{"id":"e66278df-31ce-4863-968d-c8c7aafa140f","block_type":"box","text":"market fluctuations following the default.","page_number":176,"box":{"x":117,"y":498,"width":303,"height":12}},{"id":"2fcfefc1-0c0d-4d22-95fd-6d1f68772729","block_type":"box","text":"Both types of agreement usually cover short periods, such as less than one week, although they may","page_number":176,"box":{"x":117,"y":529,"width":755,"height":12}},{"id":"38b82501-0ca0-4cde-8b6a-60747e43f419","block_type":"box","text":"have longer terms, and may be construed to be collateralized loans by the purchaser to the seller","page_number":176,"box":{"x":117,"y":545,"width":726,"height":11}},{"id":"3862c8d7-d6f2-444c-9248-5e0975442545","block_type":"box","text":"secured by the securities transferred to the purchaser. In the case of a repurchase agreement, as a","page_number":176,"box":{"x":116,"y":560,"width":743,"height":12}},{"id":"c6972c62-e910-47e8-a5e2-002bf61a6ea6","block_type":"box","text":"purchaser, a Fund’s Manager or sub-adviser will monitor the creditworthiness of the seller, and a Fund","page_number":176,"box":{"x":117,"y":575,"width":764,"height":12}},{"id":"a88e430b-e974-4608-a02d-9a303c4de8c1","block_type":"box","text":"will require the seller to provide additional collateral if the market value of the securities falls below the","page_number":176,"box":{"x":116,"y":591,"width":761,"height":12}},{"id":"e99f1a0b-06b9-4297-ba8a-848a8d439237","block_type":"box","text":"repurchase price at any time during the term of the repurchase agreement. The Fund does not have","page_number":176,"box":{"x":117,"y":606,"width":747,"height":12}},{"id":"0ffe12f4-c1a1-4d46-8f19-72de7abef9db","block_type":"box","text":"this right to seek additional collateral as a purchaser in the case of purchase and sale contracts. The","page_number":176,"box":{"x":116,"y":622,"width":750,"height":12}},{"id":"3eda28e9-f82f-4eaa-811d-5d837fcb0468","block_type":"box","text":"Fund’s Manager or sub-adviser will mark-to-market daily the value of the securities. Securities subject","page_number":176,"box":{"x":117,"y":637,"width":759,"height":12}},{"id":"df373f7b-b4a5-406d-bcde-e626d2a9687f","block_type":"box","text":"to repurchase agreements (other than tri-party repurchase agreements) and purchase and sale","page_number":176,"box":{"x":116,"y":653,"width":712,"height":12}},{"id":"ec3fb93c-474a-430d-880d-7246579c5b0b","block_type":"box","text":"contracts will be held by the Fund’s custodian (or sub-custodian) in the Federal Reserve/Treasury","page_number":176,"box":{"x":116,"y":668,"width":725,"height":12}},{"id":"841c5311-446f-4735-a3cd-a69ec08271c9","block_type":"box","text":"book-entry system or by another authorized securities depository.","page_number":176,"box":{"x":117,"y":684,"width":485,"height":12}},{"id":"ce3feb2f-7161-4152-ba9f-6066b26a8e8a","block_type":"box","text":"In the event of default by the seller under a repurchase agreement construed to be a collateralized","page_number":176,"box":{"x":117,"y":715,"width":729,"height":12}},{"id":"5e7ba987-b029-4a8e-bc85-7e41f6714937","block_type":"box","text":"loan, the underlying securities are not owned by the Fund but only constitute collateral for the seller’s","page_number":176,"box":{"x":117,"y":730,"width":748,"height":13}},{"id":"4486eea8-59ab-4fa0-92f8-51567405b732","block_type":"box","text":"obligation to pay the repurchase price. Therefore, the Fund may suffer time delays and incur costs or","page_number":176,"box":{"x":116,"y":746,"width":750,"height":12}},{"id":"34c3acd9-2c57-49ce-bc7e-9b9107277a8c","block_type":"box","text":"possible losses in connection with disposition of the collateral. If the seller becomes insolvent and","page_number":176,"box":{"x":117,"y":761,"width":721,"height":12}},{"id":"49230029-623c-4d6d-9431-c23382113aa6","block_type":"box","text":"subject to liquidation or reorganization under applicable bankruptcy or other laws, a Fund’s ability to","page_number":176,"box":{"x":116,"y":777,"width":739,"height":12}},{"id":"bdf11fa0-e0af-4cd9-ab63-ded45cb0832c","block_type":"box","text":"dispose of the underlying securities may be restricted. Finally, it is possible that a Fund may not be","page_number":176,"box":{"x":116,"y":792,"width":733,"height":13}},{"id":"b62c5c05-567f-4d96-ab54-308594d33f9f","block_type":"box","text":"able to substantiate its interest in the underlying securities. To minimize this risk, the securities","page_number":176,"box":{"x":116,"y":808,"width":701,"height":12}},{"id":"39723b1b-ed75-472b-bc0d-60f3a02721f6","block_type":"box","text":"underlying the repurchase agreement will be held by the applicable custodian at all times in an amount","page_number":176,"box":{"x":117,"y":824,"width":761,"height":12}},{"id":"5a56acc4-755d-4369-ae44-5219429bb5d7","block_type":"box","text":"at least equal to the repurchase price, including accrued interest. If the seller fails to repurchase the","page_number":176,"box":{"x":116,"y":839,"width":744,"height":12}},{"id":"e047a57a-64c3-47be-b2cf-a5a4e2dba5bf","block_type":"box","text":"securities, a Fund may suffer a loss to the extent proceeds from the sale of the underlying securities","page_number":176,"box":{"x":116,"y":854,"width":748,"height":13}},{"id":"bbbd85ba-587f-4ec2-98d4-181f40db87e0","block_type":"box","text":"are less than the repurchase price.","page_number":176,"box":{"x":116,"y":870,"width":264,"height":12}},{"id":"b5a8ca64-248c-41a9-89c3-023f478f95aa","block_type":"box","text":"II-89","page_number":176,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"024e6ace-569d-4a2b-9c6d-e07ecbf78c91","block_type":"box","text":"NM1026U-6004382-176/605","page_number":176,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b9874122-e54a-4718-bb8a-2d535719286f","block_type":"box","text":"In any repurchase transaction to which a Fund is a party, collateral for a repurchase agreement may","page_number":177,"box":{"x":117,"y":87,"width":747,"height":12}},{"id":"7ebff858-d7fb-4009-bbff-16e9719bbf7e","block_type":"box","text":"include cash items and obligations issued by the U.S. Government or its agencies or instrumentalities.","page_number":177,"box":{"x":117,"y":102,"width":762,"height":13}},{"id":"bad94193-894e-4218-b99f-404186f861f6","block_type":"box","text":"For certain Funds, however, collateral may include instruments other than cash items and obligations","page_number":177,"box":{"x":117,"y":118,"width":755,"height":12}},{"id":"e76913b1-3d32-482b-9634-282f2ef47f7d","block_type":"box","text":"issued by the U.S. Government or its agencies or instrumentalities, including securities that the Fund","page_number":177,"box":{"x":117,"y":134,"width":752,"height":12}},{"id":"e3a6087b-fbd7-4a34-9d7a-32fb44df7b1c","block_type":"box","text":"could not hold directly under its investment strategies without the repurchase obligation.","page_number":177,"box":{"x":116,"y":149,"width":657,"height":12}},{"id":"c83a9a93-4dd9-499e-a99a-effd22706dcc","block_type":"box","text":"The type of collateral underlying repurchase agreements may also pose certain risks for a Fund. Lower","page_number":177,"box":{"x":116,"y":180,"width":770,"height":12}},{"id":"db3af1ea-de5e-489e-ba88-1ef08fd19f94","block_type":"box","text":"quality collateral and collateral with longer maturities may be subject to greater price fluctuations than","page_number":177,"box":{"x":116,"y":196,"width":757,"height":12}},{"id":"e2a2e80a-d2a5-4590-a56d-41bc3383bcd0","block_type":"box","text":"higher quality collateral and collateral with shorter maturities. If the repurchase agreement counterparty","page_number":177,"box":{"x":117,"y":211,"width":769,"height":12}},{"id":"3079ab99-4b43-4c88-a5fc-76b54273aa34","block_type":"box","text":"were to default, lower quality collateral may be more difficult to liquidate than higher quality collateral.","page_number":177,"box":{"x":116,"y":227,"width":755,"height":12}},{"id":"46cff37c-17b6-4384-87f4-8bb0c908c1dd","block_type":"box","text":"Should the counterparty default and the amount of collateral not be sufficient to cover the","page_number":177,"box":{"x":116,"y":242,"width":666,"height":12}},{"id":"a38fd0be-42bf-4288-b7e5-685a14ce9eaa","block_type":"box","text":"counterparty’s repurchase obligation, a Fund would retain the status of an unsecured creditor of the","page_number":177,"box":{"x":116,"y":258,"width":744,"height":12}},{"id":"8399161d-430e-4afc-a3e3-1f15b03e6661","block_type":"box","text":"counterparty (","page_number":177,"box":{"x":116,"y":273,"width":103,"height":12}},{"id":"f37d3a90-634a-4bf1-81ac-8770b7c1ad0c","block_type":"box","text":"i.e.","page_number":177,"box":{"x":220,"y":273,"width":20,"height":10}},{"id":"ee522529-dc84-4b07-a2e0-6b13e0bb05b7","block_type":"box","text":", the position the Fund would normally be in if it were to hold, pursuant to its","page_number":177,"box":{"x":244,"y":273,"width":565,"height":12}},{"id":"cdd2647d-2697-4a34-b35c-7ee6d942a948","block_type":"box","text":"investment policies, other unsecured debt securities of the defaulting counterparty) with respect to the","page_number":177,"box":{"x":117,"y":289,"width":760,"height":12}},{"id":"dc5fbc5a-9006-43c3-b629-3a3e177fd051","block_type":"box","text":"amount of the shortfall. As an unsecured creditor, a Fund would be at risk of losing some or all of the","page_number":177,"box":{"x":116,"y":304,"width":752,"height":12}},{"id":"4362dba5-e836-4119-bc75-87c46ec5f44e","block_type":"box","text":"principal and income involved in the transaction.","page_number":177,"box":{"x":117,"y":320,"width":361,"height":12}},{"id":"7a3eb726-9858-4c89-9539-357dfb90e053","block_type":"box","text":"Regulations adopted by global prudential regulators require certain bank-regulated counterparties and","page_number":177,"box":{"x":117,"y":351,"width":761,"height":12}},{"id":"b6ec8a51-be78-411a-a7c4-9a0cf97fc9d2","block_type":"box","text":"certain of their affiliates to include in certain financial contracts, including many repurchase agreements","page_number":177,"box":{"x":116,"y":366,"width":771,"height":12}},{"id":"712305af-c8a5-48d0-b922-6472f9bead3d","block_type":"box","text":"and purchase and sale contracts, terms that delay or restrict the rights of counterparties, such as a","page_number":177,"box":{"x":116,"y":382,"width":738,"height":12}},{"id":"c8aa9ba8-688f-42d8-8786-f035e8da7a90","block_type":"box","text":"Fund, to terminate such agreements, take foreclosure action, exercise other default rights or restrict","page_number":177,"box":{"x":117,"y":397,"width":744,"height":12}},{"id":"e5cdf1fb-4b8f-40e6-856b-4a80a9dc000e","block_type":"box","text":"transfers of credit support in the event that the counterparty and/or its affiliates are subject to certain","page_number":177,"box":{"x":116,"y":413,"width":748,"height":12}},{"id":"18a7fada-a048-4d1d-a93d-4b5bded07b29","block_type":"box","text":"types of resolution or insolvency proceedings. It is possible that these new requirements, as well as","page_number":177,"box":{"x":116,"y":428,"width":743,"height":12}},{"id":"4ec51a34-9989-4fa2-b749-b0088d16d726","block_type":"box","text":"potential additional government regulation and other developments in the market, could adversely","page_number":177,"box":{"x":117,"y":444,"width":729,"height":12}},{"id":"63a91a8d-678c-4835-8fa5-435bd76cea14","block_type":"box","text":"affect a Fund’s ability to terminate existing repurchase agreements and purchase and sale contracts or","page_number":177,"box":{"x":116,"y":459,"width":768,"height":12}},{"id":"5b1c78ac-2fd2-41ae-a13f-79c0d1135364","block_type":"box","text":"to realize amounts to be received under such agreements. The SEC has also finalized rules that will","page_number":177,"box":{"x":116,"y":475,"width":747,"height":12}},{"id":"6f772cd4-5b46-4d05-8e8a-6003c23a1e01","block_type":"box","text":"require certain transactions involving U.S. Treasuries, including repurchase agreements, to be centrally","page_number":177,"box":{"x":117,"y":490,"width":770,"height":12}},{"id":"f857c341-6064-4c72-8472-f628a03f868c","block_type":"box","text":"cleared. Compliance with these rules is expected to be required by the middle of 2027. Although the","page_number":177,"box":{"x":116,"y":506,"width":747,"height":12}},{"id":"ec1ed9c8-643d-4738-9377-c538a53a60da","block_type":"box","text":"impact of these rules on the Funds is difficult to predict, they may reduce the availability or increase the","page_number":177,"box":{"x":117,"y":521,"width":770,"height":12}},{"id":"1f2b03f5-0bfe-432a-9ab9-eff522852e61","block_type":"box","text":"costs of such transactions and may adversely affect a Fund’s performance.","page_number":177,"box":{"x":116,"y":537,"width":563,"height":12}},{"id":"243e4e4b-22f8-4a76-9e51-3a4bfbbe15a5","block_type":"box","text":"Restricted Securities.","page_number":177,"box":{"x":116,"y":568,"width":177,"height":9}},{"id":"9e3b48b9-5917-4522-93ae-c20830d14ae1","block_type":"box","text":"A Fund may invest in or hold securities that are not registered under the","page_number":177,"box":{"x":293,"y":568,"width":539,"height":12}},{"id":"3ad19b4c-9235-4c7b-bf89-b3049ddd80dc","block_type":"box","text":"Securities Act (“restricted securities”), which may include securities in private companies and","page_number":177,"box":{"x":116,"y":583,"width":694,"height":12}},{"id":"d380a62d-7d3a-4acb-b30a-153cee9805fd","block_type":"box","text":"Rule 144A Securities. Restricted securities may be sold in private placement transactions between","page_number":177,"box":{"x":117,"y":599,"width":736,"height":12}},{"id":"f784becf-e45c-4eb3-846b-f1ac3b385028","block_type":"box","text":"issuers and their purchasers, including through private negotiated transactions between the issuer and","page_number":177,"box":{"x":117,"y":614,"width":765,"height":12}},{"id":"d6cfdb3f-30ba-4416-a160-b00cf427d54c","block_type":"box","text":"their purchasers, such as the Funds, and may be neither listed on an exchange nor traded in other","page_number":177,"box":{"x":116,"y":630,"width":736,"height":12}},{"id":"1edbf637-3871-439f-8db0-1f6544c062ca","block_type":"box","text":"established markets. In many cases, privately placed securities may not be freely transferable under","page_number":177,"box":{"x":116,"y":645,"width":749,"height":12}},{"id":"2ada80b2-4276-418b-a5d1-e37b1c8cd05c","block_type":"box","text":"the laws of the applicable jurisdiction or due to contractual restrictions on resale. Some of these","page_number":177,"box":{"x":116,"y":661,"width":708,"height":12}},{"id":"e07a6d64-00bf-46ad-b7fd-70bd4148a6a9","block_type":"box","text":"securities are new and complex, and trade only among institutions; the markets for these securities are","page_number":177,"box":{"x":116,"y":676,"width":764,"height":12}},{"id":"5ec2bc24-c32c-466c-8fd8-212bd5f5e7b1","block_type":"box","text":"still developing and may not function as efficiently as established markets. Typically, investments in","page_number":177,"box":{"x":116,"y":692,"width":736,"height":12}},{"id":"15b8a7dd-5248-4610-938c-8a2026f447d6","block_type":"box","text":"private companies are in restricted securities that are not traded in public markets and subject to","page_number":177,"box":{"x":117,"y":707,"width":714,"height":12}},{"id":"aab76fd8-f144-481b-a170-326a24abacd3","block_type":"box","text":"substantial holding periods, so that a Fund may not be able to resell some of its holdings for extended","page_number":177,"box":{"x":116,"y":723,"width":755,"height":12}},{"id":"38788512-e088-4ec9-a250-f2d032f8ee32","block_type":"box","text":"periods, which may be several years. There can be no assurance that a Fund will be able to realize the","page_number":177,"box":{"x":117,"y":738,"width":763,"height":12}},{"id":"637b49ab-1dd8-4425-994d-3f369f5ad9c4","block_type":"box","text":"value of such restricted securities in a timely manner or at all. As a result of the absence of a public","page_number":177,"box":{"x":116,"y":754,"width":736,"height":12}},{"id":"d68b4519-84e8-4fd8-a36f-b033f7dff546","block_type":"box","text":"trading market and the potential bespoke nature on certain transactions, restricted securities may be","page_number":177,"box":{"x":116,"y":769,"width":745,"height":12}},{"id":"08f65981-478e-496d-a7ab-118e0d040be6","block_type":"box","text":"deemed to be illiquid investments or less liquid investments and may be more difficult to value than","page_number":177,"box":{"x":116,"y":785,"width":734,"height":12}},{"id":"f3fdcb7a-9f02-49ea-9c47-6069f6306a42","block_type":"box","text":"publicly traded securities. To the extent that restricted securities may be resold in privately negotiated","page_number":177,"box":{"x":117,"y":800,"width":751,"height":12}},{"id":"2c52a3f7-597c-432a-90b2-0c090355e2cc","block_type":"box","text":"transactions, the prices realized from the sales, due to lack of liquidity, could be less than those","page_number":177,"box":{"x":116,"y":816,"width":708,"height":12}},{"id":"659c76ec-df59-4884-8c64-9835bedfc125","block_type":"box","text":"originally paid by the Fund or less than their fair market value. The amount of any discount may vary","page_number":177,"box":{"x":116,"y":831,"width":749,"height":12}},{"id":"6adc2223-9e9b-4048-b4a3-ba5d170f2118","block_type":"box","text":"depending on the security type, the character of the issuer, which party (if any) will bear the expenses","page_number":177,"box":{"x":116,"y":847,"width":760,"height":12}},{"id":"684207e5-4805-4af5-9b1c-997c50232cb4","block_type":"box","text":"of registering the restricted security, and prevailing market conditions. In addition, issuers whose","page_number":177,"box":{"x":116,"y":862,"width":720,"height":12}},{"id":"b55433c1-8747-4d64-813d-a96a1e3deeea","block_type":"box","text":"securities are not publicly traded or who are not otherwise publicly listed may not be subject to the","page_number":177,"box":{"x":116,"y":878,"width":732,"height":12}},{"id":"b9279688-8ced-4dac-9b06-c17d2eb4b8b2","block_type":"box","text":"II-90","page_number":177,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"ac36be6c-e72e-4dd2-afab-2b497e5821c5","block_type":"box","text":"NM1026U-6004382-177/605","page_number":177,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"d8b1baaa-f4fb-41fe-8f69-a2dd32e8cc21","block_type":"box","text":"disclosure and other investor protection requirements that may be applicable if their securities were","page_number":178,"box":{"x":116,"y":87,"width":742,"height":12}},{"id":"2fe4ac9f-0d8c-4dd2-a198-772e994374ee","block_type":"box","text":"publicly traded. If any privately placed securities held by a Fund are required to be registered under the","page_number":178,"box":{"x":117,"y":102,"width":769,"height":13}},{"id":"9c537339-de96-4961-b129-4e968de739b2","block_type":"box","text":"securities laws of one or more jurisdictions before being resold, the Fund may be required to bear the","page_number":178,"box":{"x":116,"y":118,"width":757,"height":12}},{"id":"127e8e24-e3a8-42a7-adef-1bf9f7213bc6","block_type":"box","text":"expenses of registration. Where registration is required for restricted securities, a considerable time","page_number":178,"box":{"x":116,"y":134,"width":743,"height":12}},{"id":"be936357-ece6-49d0-bbf0-1fa79c9865cd","block_type":"box","text":"period may elapse between the time the Fund decides to sell the security and the time it is actually","page_number":178,"box":{"x":117,"y":149,"width":736,"height":12}},{"id":"d8ebce1c-f989-4e36-860a-be368b5a9360","block_type":"box","text":"permitted to sell the security under an effective registration statement. If during such period, adverse","page_number":178,"box":{"x":117,"y":165,"width":749,"height":12}},{"id":"bfb3a4b1-5b70-4e55-8f09-320538fd9243","block_type":"box","text":"market conditions were to develop, the Fund might obtain less favorable pricing terms than when it","page_number":178,"box":{"x":117,"y":180,"width":736,"height":12}},{"id":"1318cbf7-b0ea-47a7-924b-b46f661f352f","block_type":"box","text":"decided to sell the security. In addition, the Fund may be deemed to be an “underwriter” for purposes","page_number":178,"box":{"x":116,"y":196,"width":755,"height":12}},{"id":"c9f08947-548e-4ec8-a381-6d85dac552f8","block_type":"box","text":"of the Securities Act when selling restricted securities. If so, the Fund may be liable to purchasers of","page_number":178,"box":{"x":116,"y":211,"width":747,"height":12}},{"id":"e1144b11-0a10-42ab-892e-91f14b604a5a","block_type":"box","text":"the restricted securities if the registration statement prepared by the issuer, or the corresponding","page_number":178,"box":{"x":116,"y":227,"width":722,"height":12}},{"id":"f420b1a9-8eb4-4154-aa76-bfe8f880dc6b","block_type":"box","text":"prospectus, is materially inaccurate or misleading. Transactions in restricted securities may entail other","page_number":178,"box":{"x":117,"y":242,"width":769,"height":12}},{"id":"bd6af147-9a32-4869-ac21-af238b996357","block_type":"box","text":"transaction costs that are higher than those for transactions in unrestricted securities. Certain of the","page_number":178,"box":{"x":116,"y":258,"width":744,"height":12}},{"id":"f33bf0e6-969d-402f-8e7c-6d123b110e1a","block_type":"box","text":"Fund’s investments in private placements may consist of direct investments and may include","page_number":178,"box":{"x":117,"y":273,"width":692,"height":12}},{"id":"88729797-5625-41e6-8994-e797b07e30cc","block_type":"box","text":"investments in smaller, less seasoned issuers, which may involve greater risks. Issuers of restricted","page_number":178,"box":{"x":117,"y":289,"width":744,"height":12}},{"id":"af55ab06-7b70-4dc7-acd4-41bb8ac3a060","block_type":"box","text":"securities may not be subject to SEC reporting requirements, may not be required to maintain their","page_number":178,"box":{"x":116,"y":304,"width":737,"height":12}},{"id":"e44eb11e-c50f-4b7b-9391-607dbe71cc18","block_type":"box","text":"accounting records in accordance with generally accepted accounting principles, and may not be","page_number":178,"box":{"x":116,"y":320,"width":724,"height":12}},{"id":"3815db9d-d7c6-49f8-b4c6-abff30bebac7","block_type":"box","text":"required to maintain effective internal controls over financial reporting. As a result, BlackRock may not","page_number":178,"box":{"x":117,"y":335,"width":760,"height":12}},{"id":"f9ec7af0-fe0b-4d18-95da-b468cb4c65f2","block_type":"box","text":"have timely or accurate information about the business, financial condition and results of operations of","page_number":178,"box":{"x":117,"y":351,"width":762,"height":12}},{"id":"fe769e5d-32ab-453b-a129-5bef2b51807c","block_type":"box","text":"such issuers, and investments in securities of such issuers may involve a high degree of business and","page_number":178,"box":{"x":116,"y":366,"width":764,"height":12}},{"id":"8ae1be90-8be3-41f6-99ac-5b39963a81ee","block_type":"box","text":"financial risk and may result in substantial losses to the Fund. Such issuers may also have limited","page_number":178,"box":{"x":116,"y":382,"width":729,"height":12}},{"id":"b13006c1-3c11-4841-8558-ce52df7507c7","block_type":"box","text":"product lines, markets or financial resources, or they may be dependent on a limited management","page_number":178,"box":{"x":117,"y":397,"width":731,"height":12}},{"id":"b232e41d-b098-4112-8f07-9b4f7f3af62d","block_type":"box","text":"group.","page_number":178,"box":{"x":116,"y":415,"width":52,"height":10}},{"id":"5ffc22d2-c5dc-4183-92e7-feb9f1c767b6","block_type":"box","text":"Certain restricted securities may represent limited investment opportunities and each shareholder’s","page_number":178,"box":{"x":117,"y":444,"width":740,"height":12}},{"id":"54fed232-91b2-4864-bc46-817b84707e3e","block_type":"box","text":"proportionate investment exposure to such limited investment opportunities may be reduced","page_number":178,"box":{"x":117,"y":459,"width":687,"height":12}},{"id":"1b4bf9dc-3bd0-414c-a93f-910d8bc96dda","block_type":"box","text":"proportionately as the Fund’s net assets grow from new or additional investments made in the Fund by","page_number":178,"box":{"x":117,"y":475,"width":766,"height":12}},{"id":"34fe3247-c7f7-4473-af55-c192bc6085b1","block_type":"box","text":"other shareholders. The issuer of a private placement may later register those shares for public sale in","page_number":178,"box":{"x":116,"y":490,"width":765,"height":12}},{"id":"37afa227-8f3e-4eca-8608-848e9c653875","block_type":"box","text":"an IPO, but there is no guarantee that an IPO will ever be completed. Even after an IPO, there may be","page_number":178,"box":{"x":116,"y":506,"width":766,"height":12}},{"id":"9a0fbea6-b6a7-47e8-8a4a-92a3f7316f9b","block_type":"box","text":"a limited trading market for securities of that issuer, including any direct investment by a Fund, or the","page_number":178,"box":{"x":116,"y":521,"width":752,"height":12}},{"id":"0949762c-7525-420e-8991-97125108788c","block_type":"box","text":"Fund may be subject to contractual limitations on its ability to resell its existing securities following an","page_number":178,"box":{"x":117,"y":537,"width":754,"height":12}},{"id":"1469672e-40fb-4630-9dc6-6706e75310ee","block_type":"box","text":"IPO. The inability of an applicable issuer of a restricted security to complete an IPO or offer other","page_number":178,"box":{"x":117,"y":552,"width":723,"height":12}},{"id":"c5640b46-b5e0-47f5-9ae0-ad3991b07d29","block_type":"box","text":"liquidity opportunities to the Fund and other investors will extend the holding period of a Fund’s","page_number":178,"box":{"x":117,"y":568,"width":708,"height":12}},{"id":"8d7ca9bb-01a5-406d-a6ab-2e6aeda57af9","block_type":"box","text":"investments, potentially indefinitely, and may adversely affect the value of the investments. In making","page_number":178,"box":{"x":117,"y":583,"width":756,"height":12}},{"id":"37a99c2b-39d5-4c67-ad29-5fae4cf5a720","block_type":"box","text":"investments in such securities, a Fund may obtain access to material nonpublic information, which may","page_number":178,"box":{"x":117,"y":599,"width":770,"height":12}},{"id":"9fc4a8f0-933a-4c75-b730-3afe674b7bb6","block_type":"box","text":"restrict the Fund’s ability to conduct portfolio transactions in such securities. The activity of identifying,","page_number":178,"box":{"x":117,"y":614,"width":759,"height":12}},{"id":"dad8902c-ea62-4efb-8f78-62cefdeaa83d","block_type":"box","text":"completing, and realizing upon attractive investments in restricted securities is highly competitive and","page_number":178,"box":{"x":116,"y":630,"width":756,"height":12}},{"id":"6ad8fc40-5ca2-4758-9761-e80cd9ce172f","block_type":"box","text":"involves a high degree of uncertainty. A Fund will be competing for investments against other similarly","page_number":178,"box":{"x":117,"y":645,"width":761,"height":12}},{"id":"2d6b2d3a-7ad3-4b4a-ae95-e419c31e5eea","block_type":"box","text":"situated investors. It is possible that competition for appropriate investment opportunities may increase,","page_number":178,"box":{"x":116,"y":661,"width":766,"height":12}},{"id":"1c3efbea-a284-4f30-a206-5e869f6a31d1","block_type":"box","text":"thus potentially reducing the number of investment opportunities available to a Fund and adversely","page_number":178,"box":{"x":116,"y":676,"width":733,"height":12}},{"id":"2a9b0281-9eda-4af1-95e5-62c7f0939496","block_type":"box","text":"affecting the terms upon which investments can be made. There is no assurance that investment","page_number":178,"box":{"x":116,"y":692,"width":719,"height":12}},{"id":"3ff7e8ee-957a-4c2b-b5c1-78bd5262a33c","block_type":"box","text":"opportunities for restricted securities will be available at any given time or at a level desired by a Fund,","page_number":178,"box":{"x":116,"y":707,"width":759,"height":12}},{"id":"c8dca172-ddd6-4848-b67b-43293022259c","block_type":"box","text":"especially as that Fund grows in size.","page_number":178,"box":{"x":116,"y":723,"width":277,"height":12}},{"id":"66db05dc-5a41-4319-b33a-d91d0850ef40","block_type":"box","text":"There may not be a readily available market value for a Fund’s restricted securities (in particular,","page_number":178,"box":{"x":116,"y":754,"width":716,"height":12}},{"id":"6dbe6720-540b-4dbf-b4bc-aa490b4007a7","block_type":"box","text":"restricted securities issued by private companies) and thus they may be considered “illiquid”. Each","page_number":178,"box":{"x":117,"y":769,"width":728,"height":12}},{"id":"b7c4ca2e-7eac-4653-bd00-c9fb5ae11953","block_type":"box","text":"Fund values restricted securities in accordance with BlackRock’s valuation policies and procedures,","page_number":178,"box":{"x":117,"y":785,"width":738,"height":12}},{"id":"5eadac88-d600-4cc6-aff0-383df3397faa","block_type":"box","text":"which are designed to value investments such that they accurately reflect fair value. Due to the","page_number":178,"box":{"x":116,"y":800,"width":704,"height":12}},{"id":"2979d6ad-3f64-43b6-8571-afcae985c38e","block_type":"box","text":"inherent uncertainty and subjectivity of determining the fair value of investments that do not have a","page_number":178,"box":{"x":117,"y":816,"width":731,"height":12}},{"id":"f08298ca-c9fc-4c6a-a2f2-b7ea818d3c13","block_type":"box","text":"readily available market value, the fair value of a Fund’s private investments may differ significantly","page_number":178,"box":{"x":117,"y":831,"width":739,"height":12}},{"id":"36eaa77a-a1d3-4775-b240-e659de11f47f","block_type":"box","text":"from the values that would have been used had a readily available market value existed for such","page_number":178,"box":{"x":116,"y":847,"width":721,"height":12}},{"id":"e8eaf6da-4a1a-49d3-b9c7-da59957b0782","block_type":"box","text":"investments and may differ materially from the amounts the Fund may realize on any dispositions of","page_number":178,"box":{"x":117,"y":862,"width":745,"height":12}},{"id":"91be44cc-aa8a-48c4-9d32-1eacdfecda62","block_type":"box","text":"such investments. Differences in the value of the Fund’s private investments could result in the Fund’s","page_number":178,"box":{"x":116,"y":878,"width":763,"height":12}},{"id":"78e7a0ef-3366-40a2-8522-5d95bc470ca2","block_type":"box","text":"II-91","page_number":178,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"feccc199-a151-4cf8-a347-461788f4f761","block_type":"box","text":"NM1026U-6004382-178/605","page_number":178,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"72e7fb6d-bcd5-424b-ad0e-36842d17b3ed","block_type":"box","text":"shareholder transactions being effected at a NAV that does not accurately reflect the underlying value","page_number":179,"box":{"x":116,"y":87,"width":761,"height":12}},{"id":"2314fe56-aa68-40a1-bbba-05111b5e25b5","block_type":"box","text":"of the Fund’s portfolio, potentially resulting in the dilution of shareholder interests and increasing","page_number":179,"box":{"x":116,"y":102,"width":718,"height":13}},{"id":"2e31e1cc-ff0d-4c82-a913-a6993d8c01ec","block_type":"box","text":"opportunities for shareholder arbitrage. The values used by the Fund to price its restricted securities","page_number":179,"box":{"x":116,"y":118,"width":747,"height":12}},{"id":"69879617-dd37-4464-b741-78c12845025d","block_type":"box","text":"may also differ from those used by other investment companies and investors to price the same","page_number":179,"box":{"x":117,"y":134,"width":715,"height":12}},{"id":"1f7075cf-e104-43f7-b0d0-8798525aa485","block_type":"box","text":"restricted securities. In addition, the impact of changes in the market environment and other events on","page_number":179,"box":{"x":117,"y":149,"width":763,"height":12}},{"id":"8aa6b6f8-56ff-4c84-a832-5c94f509910f","block_type":"box","text":"the fair values of a Fund’s investments that have no readily available market values may differ from the","page_number":179,"box":{"x":116,"y":165,"width":769,"height":12}},{"id":"d9c74ede-deed-4597-857a-bdb8e71abdb8","block_type":"box","text":"impact of such changes on the readily available market values for the Fund’s other investments. A","page_number":179,"box":{"x":117,"y":180,"width":732,"height":12}},{"id":"4ab17926-1067-459b-b8ee-1282faf61ef3","block_type":"box","text":"Fund’s NAV could be adversely affected if the Fund’s determinations regarding the fair value of the","page_number":179,"box":{"x":117,"y":196,"width":738,"height":12}},{"id":"9f4540b2-a5d0-4013-8dab-4e62d42f0b60","block_type":"box","text":"Fund’s investments were materially higher than the investment’s actual market or fair value or the","page_number":179,"box":{"x":117,"y":211,"width":728,"height":12}},{"id":"d30d577b-1d21-4e83-b54f-99f0fc633e55","block_type":"box","text":"values that the Fund ultimately realizes upon the disposal of such investments.","page_number":179,"box":{"x":116,"y":227,"width":590,"height":12}},{"id":"9e6da2fd-f316-4f2a-950e-b30a4a74875b","block_type":"box","text":"See also risks discussed under “Illiquid Investments.”","page_number":179,"box":{"x":116,"y":258,"width":400,"height":11}},{"id":"a7a5af96-89ef-482c-8c02-60510df47751","block_type":"box","text":"Reverse Repurchase Agreements.","page_number":179,"box":{"x":116,"y":289,"width":271,"height":12}},{"id":"f66b2031-40b9-4f34-b07d-ab00117895c3","block_type":"box","text":"A Fund may enter into reverse repurchase agreements with the","page_number":179,"box":{"x":389,"y":289,"width":481,"height":12}},{"id":"6e0e13b6-1825-4e50-b79a-4436ed5eb51c","block_type":"box","text":"same parties with whom it may enter into repurchase agreements. Under a reverse repurchase","page_number":179,"box":{"x":116,"y":304,"width":711,"height":12}},{"id":"ed4fd3a1-bbee-45ce-b779-b13cb963aa9f","block_type":"box","text":"agreement, a Fund sells securities to another party and agrees to repurchase them at a particular date","page_number":179,"box":{"x":116,"y":320,"width":766,"height":12}},{"id":"54f8db94-467f-490c-bf65-3c7020aedfaa","block_type":"box","text":"and price. A Fund may enter into a reverse repurchase agreement when it is anticipated that the","page_number":179,"box":{"x":116,"y":335,"width":719,"height":12}},{"id":"7245e19c-7c0f-47f9-8ad0-eaeb65c425e1","block_type":"box","text":"interest income to be earned from the investment of the proceeds of the transaction is greater than the","page_number":179,"box":{"x":117,"y":351,"width":765,"height":12}},{"id":"92bf628a-be0f-489a-ad51-26c114406a2b","block_type":"box","text":"interest expense of the transaction.","page_number":179,"box":{"x":117,"y":366,"width":265,"height":12}},{"id":"d390a4b2-8af4-4128-8a1f-e7f96013fafd","block_type":"box","text":"The use of reverse repurchase agreements may be regarded as leveraging and, therefore, speculative.","page_number":179,"box":{"x":116,"y":397,"width":772,"height":12}},{"id":"5d23704d-ec71-48ee-8ddc-2ccb7a06f104","block_type":"box","text":"Furthermore, reverse repurchase agreements involve the risks that (i) the interest income earned in the","page_number":179,"box":{"x":117,"y":413,"width":771,"height":12}},{"id":"acc90e09-9591-4e39-ad41-fb5033a3ce1b","block_type":"box","text":"investment of the proceeds will be less than the interest expense, (ii) the market value of the securities","page_number":179,"box":{"x":117,"y":428,"width":765,"height":12}},{"id":"9e099c70-1689-4f1e-8cb8-bd35cb20f4e7","block_type":"box","text":"retained in lieu of sale by a Fund may decline below","page_number":179,"box":{"x":117,"y":444,"width":390,"height":12}},{"id":"410c9e87-9cec-4ef0-b549-aff300280a18","block_type":"box","text":"the price of the securities the Fund has sold but is","page_number":179,"box":{"x":507,"y":444,"width":375,"height":12}},{"id":"03357ce0-70c0-40ee-b0ea-46ae6d15a88c","block_type":"box","text":"obligated to repurchase, (iii) the market value of the securities sold will decline below the price at which","page_number":179,"box":{"x":116,"y":459,"width":770,"height":12}},{"id":"fd1ce2d2-71e0-4e32-ae4a-6fd8447c045c","block_type":"box","text":"the Fund is required to repurchase them and (iv) the securities will not be returned to the Fund.","page_number":179,"box":{"x":116,"y":475,"width":710,"height":12}},{"id":"1134b2a2-8aeb-4c11-a251-162ca6706570","block_type":"box","text":"In addition, if the buyer of securities under a reverse repurchase agreement files for bankruptcy or","page_number":179,"box":{"x":117,"y":506,"width":731,"height":12}},{"id":"c9eb5ba5-75d6-45a2-8353-9b75f12ad2e8","block_type":"box","text":"becomes insolvent, such buyer or its trustee or receiver may receive an extension of time to determine","page_number":179,"box":{"x":117,"y":521,"width":765,"height":12}},{"id":"888f10eb-7a99-45d4-8b7a-a7a49d77ea28","block_type":"box","text":"whether to enforce a Fund’s obligations to repurchase the securities and the Fund’s use of the","page_number":179,"box":{"x":116,"y":537,"width":704,"height":12}},{"id":"ecc454c5-2cd6-44e4-ac1c-58966ce28074","block_type":"box","text":"proceeds of the reverse repurchase agreement may effectively be restricted pending such decision.","page_number":179,"box":{"x":117,"y":552,"width":744,"height":12}},{"id":"4445f5ec-5a4b-4e09-b376-40de5e40bfdc","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into reverse repurchase","page_number":179,"box":{"x":117,"y":583,"width":710,"height":12}},{"id":"40cec9fe-1256-46af-b68e-acf4ed20c551","block_type":"box","text":"agreements and similar financing transactions (e.g., recourse and non-recourse tender option bonds,","page_number":179,"box":{"x":116,"y":599,"width":755,"height":12}},{"id":"6edef8ea-6589-4d46-8305-c9d5d85ea67b","block_type":"box","text":"borrowed bonds) notwithstanding the limitation on the issuance of senior securities in Section 18 of the","page_number":179,"box":{"x":117,"y":614,"width":767,"height":12}},{"id":"d9271be1-d544-4690-b3d6-498f90a9836d","block_type":"box","text":"Investment Company Act, provided that the Fund either (i) complies with the 300% asset coverage","page_number":179,"box":{"x":117,"y":630,"width":736,"height":12}},{"id":"3f09eb58-90af-40b3-86c3-f61fde5e681c","block_type":"box","text":"ratio with respect to all such transactions and any other borrowings in the aggregate, or (ii) treats all","page_number":179,"box":{"x":117,"y":645,"width":744,"height":12}},{"id":"28790204-42c3-480b-b549-9fcf257e3f0b","block_type":"box","text":"such transactions as Derivatives Transactions under Rule 18f-4. See “—Derivatives—Regulation of","page_number":179,"box":{"x":116,"y":661,"width":738,"height":12}},{"id":"47c6bb8d-6c3d-4098-9304-88d6797e689e","block_type":"box","text":"Derivatives—Rule 18f-4 under the Investment Company Act” above. The SEC has also finalized rules","page_number":179,"box":{"x":117,"y":676,"width":753,"height":12}},{"id":"a0a02ae7-998e-4823-92e5-65445485a71f","block_type":"box","text":"that will require certain transactions involving U.S. Treasuries, including reverse repurchase","page_number":179,"box":{"x":116,"y":692,"width":680,"height":12}},{"id":"b68abb31-a3e8-4bcd-840c-13f4a2e7bfc4","block_type":"box","text":"agreements, to be centrally cleared. Compliance with these rules is expected to be required by the","page_number":179,"box":{"x":116,"y":707,"width":731,"height":12}},{"id":"3e50b45b-bd10-46a6-8c85-3310b4a78ca4","block_type":"box","text":"middle of 2027. Although the impact of these rules on the Funds is difficult to predict, they may reduce","page_number":179,"box":{"x":117,"y":723,"width":757,"height":12}},{"id":"dfb4e1a1-151b-45d8-bc89-fa4715d5b67d","block_type":"box","text":"the availability or increase the costs of such transactions and may adversely affect a Fund’s","page_number":179,"box":{"x":116,"y":738,"width":680,"height":12}},{"id":"14be86a1-9a7f-4a4d-bccf-3d8fcf279889","block_type":"box","text":"performance.","page_number":179,"box":{"x":117,"y":754,"width":96,"height":12}},{"id":"52c9273d-87d1-45d0-9c7a-69a6766c1aa6","block_type":"box","text":"Additionally, regulations adopted by global prudential regulators require certain bank-regulated","page_number":179,"box":{"x":116,"y":785,"width":701,"height":12}},{"id":"1400a8c9-1337-4421-b2e3-5e25c0bc5be8","block_type":"box","text":"counterparties and certain of their affiliates to include in certain financial contracts, including many","page_number":179,"box":{"x":116,"y":800,"width":727,"height":12}},{"id":"2784f981-db7e-4e9f-b01e-584a4e596965","block_type":"box","text":"reverse repurchase agreements, terms that delay or restrict the rights of counterparties, such as a","page_number":179,"box":{"x":117,"y":816,"width":727,"height":12}},{"id":"f34101f7-b4e0-4884-89f9-5473ab201130","block_type":"box","text":"Fund, to terminate such agreements, take foreclosure action, exercise other default rights or restrict","page_number":179,"box":{"x":117,"y":831,"width":744,"height":12}},{"id":"e07a7bdb-ac02-456f-a4a8-385e7c84d3ab","block_type":"box","text":"transfers of credit support in the event that the counterparty and/or its affiliates are subject to certain","page_number":179,"box":{"x":116,"y":847,"width":748,"height":12}},{"id":"7ddfcaa9-a136-4e9c-80f5-6b966fea18ee","block_type":"box","text":"types of resolution or insolvency proceedings. It is possible that these requirements, as well as","page_number":179,"box":{"x":116,"y":862,"width":707,"height":12}},{"id":"153691c4-35ef-4b09-88a9-abca9bc1892e","block_type":"box","text":"potential additional government regulation and other developments in the market, could adversely","page_number":179,"box":{"x":117,"y":878,"width":729,"height":12}},{"id":"34234681-a244-497d-afd5-eafe6fb154a6","block_type":"box","text":"II-92","page_number":179,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"ea29cab8-f65f-46e3-a337-7f3f9bb135e4","block_type":"box","text":"NM1026U-6004382-179/605","page_number":179,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6311e12b-707d-4dba-9489-7f59e2488eb3","block_type":"box","text":"affect a Fund’s ability to terminate existing reverse repurchase agreements or to realize amounts to be","page_number":180,"box":{"x":116,"y":87,"width":765,"height":12}},{"id":"720ba6ea-31d5-4e58-b452-ecd67cbdb2f0","block_type":"box","text":"received under such agreements.","page_number":180,"box":{"x":117,"y":103,"width":253,"height":12}},{"id":"39bd4755-b91b-42fa-a82c-d5d670e7abfe","block_type":"box","text":"Rights Offerings and Warrants to Purchase.","page_number":180,"box":{"x":116,"y":134,"width":349,"height":12}},{"id":"ded57584-d5e5-48cf-b37f-65842037a8d0","block_type":"box","text":"Certain Funds may participate in rights offerings and","page_number":180,"box":{"x":466,"y":134,"width":399,"height":12}},{"id":"76d67c9d-f013-4660-862e-8168add2f884","block_type":"box","text":"may purchase warrants, which are privileges issued by corporations enabling the owners to subscribe","page_number":180,"box":{"x":117,"y":149,"width":759,"height":12}},{"id":"0c538af3-5b7c-42a4-89e8-7ea395b50d9a","block_type":"box","text":"to and purchase a specified number of shares of the corporation at a specified price during a specified","page_number":180,"box":{"x":116,"y":165,"width":763,"height":12}},{"id":"cea1502b-c1b7-423a-bbfd-3ba2f7674e2b","block_type":"box","text":"period of time. Subscription rights normally have a short life span to expiration. The purchase of rights","page_number":180,"box":{"x":117,"y":180,"width":759,"height":12}},{"id":"62f5fd2e-e4ea-4c16-9413-89fca0355cad","block_type":"box","text":"or warrants involves the risk that a Fund could lose the purchase value of a right or warrant if the right","page_number":180,"box":{"x":116,"y":196,"width":760,"height":12}},{"id":"3caf6dfd-ff41-4dab-ab36-8412dc1eb518","block_type":"box","text":"to subscribe to additional shares is not exercised prior to the rights’ and warrants’ expiration. Also, the","page_number":180,"box":{"x":116,"y":211,"width":760,"height":12}},{"id":"c757f048-3424-4262-a8b7-3f231a36b7b0","block_type":"box","text":"purchase of rights and/or warrants involves the risk that the effective price paid for the right and/or","page_number":180,"box":{"x":117,"y":227,"width":732,"height":12}},{"id":"1bffcb1e-92de-4809-b0e9-f25ff308e6cc","block_type":"box","text":"warrant added to the subscription price of the related security may exceed the value of the subscribed","page_number":180,"box":{"x":116,"y":242,"width":762,"height":12}},{"id":"7849f139-7966-4074-bf09-83073bc9df1a","block_type":"box","text":"security’s market price such as when there is no movement in the level of the underlying security.","page_number":180,"box":{"x":116,"y":258,"width":728,"height":12}},{"id":"71b6114e-7311-4e23-a7e4-48490e5f4dfe","block_type":"box","text":"Buying a warrant does not make the Fund a shareholder of the underlying stock. The warrant holder","page_number":180,"box":{"x":117,"y":273,"width":747,"height":12}},{"id":"3b68e8bb-885a-495e-b6b3-cbed927c7468","block_type":"box","text":"has no voting or dividend rights with respect to the underlying stock. A warrant does not carry any right","page_number":180,"box":{"x":117,"y":289,"width":766,"height":12}},{"id":"b58a93bb-c72b-41d9-a105-e9258c327518","block_type":"box","text":"to assets of the issuer, and for this reason investments in warrants may be more speculative than other","page_number":180,"box":{"x":116,"y":304,"width":771,"height":12}},{"id":"2935f7d6-2c1b-40be-8c48-aa4b14313c77","block_type":"box","text":"equity-based investments.","page_number":180,"box":{"x":116,"y":320,"width":200,"height":12}},{"id":"68a396f3-fb08-489a-838b-1c92496d6544","block_type":"box","text":"Rule 144A Securities.","page_number":180,"box":{"x":116,"y":351,"width":170,"height":9}},{"id":"b4a1cf94-f88f-4227-9cf1-e6ee5c9969d3","block_type":"box","text":"A Fund may purchase securities that can be offered and sold only to “qualified","page_number":180,"box":{"x":287,"y":351,"width":590,"height":12}},{"id":"b90d3411-6b86-4c42-a278-8d3bad0773d9","block_type":"box","text":"institutional buyers” pursuant to Rule 144A under the Securities Act. See “Restricted Securities” above.","page_number":180,"box":{"x":117,"y":366,"width":769,"height":12}},{"id":"81ac3caf-b7fc-42ea-826b-46324d0dbb22","block_type":"box","text":"Securities Lending.","page_number":180,"box":{"x":117,"y":397,"width":153,"height":12}},{"id":"795215f7-1001-45f8-9cd0-82514b18ad13","block_type":"box","text":"Each Fund may lend portfolio securities to certain borrowers that BlackRock","page_number":180,"box":{"x":271,"y":397,"width":575,"height":12}},{"id":"ee75cb5c-0f7a-49d4-a57f-72a1c79bf5e5","block_type":"box","text":"determines to be creditworthy, including borrowers affiliated with BlackRock. The borrowers provide","page_number":180,"box":{"x":116,"y":413,"width":744,"height":12}},{"id":"633b3baf-5148-4054-9db5-15518e79a0a1","block_type":"box","text":"collateral that is maintained in an amount at least","page_number":180,"box":{"x":116,"y":428,"width":369,"height":10}},{"id":"21144784-4140-42f2-b089-f4e48af06a21","block_type":"box","text":"equal to the current market value of the securities","page_number":180,"box":{"x":486,"y":428,"width":373,"height":12}},{"id":"515be68f-df18-4a97-8319-ac9f95a65cea","block_type":"box","text":"loaned. No securities loan shall be made on behalf of a Fund if, as a result, the aggregate value of all","page_number":180,"box":{"x":117,"y":444,"width":755,"height":12}},{"id":"02b1f875-825f-45e6-ba09-d8c9eb19296f","block_type":"box","text":"securities loans of the particular Fund exceeds one-third of the value of such Fund’s total assets","page_number":180,"box":{"x":116,"y":459,"width":718,"height":12}},{"id":"078fdaed-706e-4ccd-b604-649c1e1b810f","block_type":"box","text":"(including the value of the collateral received). A Fund may terminate a loan at any time and obtain the","page_number":180,"box":{"x":117,"y":475,"width":765,"height":12}},{"id":"612a5db9-131e-431c-8455-d49a0a2ebf4f","block_type":"box","text":"return of the securities loaned. Each Fund receives, by way of substitute payment, the value of any","page_number":180,"box":{"x":117,"y":490,"width":738,"height":12}},{"id":"016d0fe6-81a7-42bb-8409-448bf3366960","block_type":"box","text":"interest or cash or non-cash distributions paid on the loaned securities that it would have otherwise","page_number":180,"box":{"x":117,"y":506,"width":738,"height":12}},{"id":"4456d3c8-0fc1-4cde-807a-1bdf25c8b96e","block_type":"box","text":"received if the securities were not on loan.","page_number":180,"box":{"x":117,"y":521,"width":318,"height":10}},{"id":"46400219-47ac-4a3a-bdfc-214b6ec8115d","block_type":"box","text":"With respect to loans that are collateralized by cash, the borrower may be entitled to receive a fee","page_number":180,"box":{"x":116,"y":552,"width":732,"height":12}},{"id":"670776dc-88d6-4559-aa76-09833b955dcf","block_type":"box","text":"based on the amount of cash collateral. The Funds are compensated by any positive difference","page_number":180,"box":{"x":117,"y":568,"width":712,"height":12}},{"id":"5c4a60a4-82d8-4b6b-9d30-e9c30face933","block_type":"box","text":"between the amount earned on the reinvestment of cash collateral and the fee paid to the borrower. In","page_number":180,"box":{"x":117,"y":583,"width":763,"height":12}},{"id":"2fa04a7a-e902-448c-9a56-321338783419","block_type":"box","text":"the case of collateral other than cash, a Fund is compensated by a fee paid by the borrower equal to a","page_number":180,"box":{"x":116,"y":599,"width":765,"height":12}},{"id":"14692c8f-6a81-4f72-a7d3-ea6df8c3948a","block_type":"box","text":"percentage of the market value of the loaned securities. Any cash collateral received by the Fund for","page_number":180,"box":{"x":117,"y":614,"width":750,"height":12}},{"id":"ebe55443-ecca-422d-8cd3-fab1c4d1944f","block_type":"box","text":"such loans, and uninvested cash, may be reinvested in certain short-term instruments either directly on","page_number":180,"box":{"x":116,"y":630,"width":770,"height":12}},{"id":"5a348cce-2dc4-43ab-81c4-7d84661d4030","block_type":"box","text":"behalf of the Fund or through one or more joint accounts or money market funds, including those","page_number":180,"box":{"x":117,"y":645,"width":722,"height":12}},{"id":"eaf195b6-48d6-47e7-a3f6-d7b0e34cac9f","block_type":"box","text":"affiliated with BlackRock; such investments are subject to investment risk.","page_number":180,"box":{"x":116,"y":661,"width":546,"height":12}},{"id":"7240f8a2-971b-496e-a727-436b91921abb","block_type":"box","text":"Securities lending involves exposure to","page_number":180,"box":{"x":116,"y":692,"width":284,"height":12}},{"id":"b8c1bff4-0342-4a3f-840e-c6a2870573d0","block_type":"box","text":"certain risks, including operational risk (","page_number":180,"box":{"x":405,"y":692,"width":286,"height":12}},{"id":"c990b214-3f26-46ac-9057-bff7d98be6db","block_type":"box","text":"i.e.","page_number":180,"box":{"x":692,"y":692,"width":20,"height":9}},{"id":"e1f54365-8a67-49c0-8be5-7cb06c7e02f3","block_type":"box","text":", the risk of losses","page_number":180,"box":{"x":715,"y":692,"width":130,"height":11}},{"id":"fc62dbb9-230a-432c-92ba-9e79770405f6","block_type":"box","text":"resulting from problems in the settlement and accounting process), “gap” risk (","page_number":180,"box":{"x":117,"y":707,"width":567,"height":12}},{"id":"b1a28701-2045-4573-942b-60a1c1d63254","block_type":"box","text":"i.e.","page_number":180,"box":{"x":685,"y":707,"width":20,"height":10}},{"id":"3e9c57bc-be36-4e12-b3f4-7103b1369a4a","block_type":"box","text":", the risk of a mismatch","page_number":180,"box":{"x":708,"y":707,"width":167,"height":11}},{"id":"a331e633-b6f9-460b-a871-4eb38e2cc84d","block_type":"box","text":"between the return on cash collateral reinvestments and the fees each Fund has agreed to pay a","page_number":180,"box":{"x":117,"y":723,"width":703,"height":12}},{"id":"f8eda563-6976-4036-b61f-b0773b1e8cbd","block_type":"box","text":"borrower), foreign exchange risk (","page_number":180,"box":{"x":117,"y":738,"width":244,"height":12}},{"id":"d0c4e1bd-4ebf-42a7-96af-790f8d373368","block_type":"box","text":"i.e.","page_number":180,"box":{"x":362,"y":738,"width":20,"height":10}},{"id":"9d56ab92-d849-4bfa-99a0-bddfeaabbe99","block_type":"box","text":", the risk of a shortfall at default when a cash collateral investment is","page_number":180,"box":{"x":385,"y":738,"width":494,"height":11}},{"id":"b0a7a243-a04a-4c23-ae45-76016bfda601","block_type":"box","text":"denominated in a currency other than the currency","page_number":180,"box":{"x":116,"y":754,"width":368,"height":12}},{"id":"c237e464-9a49-483b-847a-0a5bc50aee6a","block_type":"box","text":"of the assets being loaned due to movements in","page_number":180,"box":{"x":489,"y":754,"width":348,"height":12}},{"id":"9c11fd21-0169-4df6-83e5-dcef02ce206f","block_type":"box","text":"foreign exchange rates), and credit, legal, counterparty","page_number":180,"box":{"x":116,"y":769,"width":398,"height":12}},{"id":"7af12978-5856-4fbc-977c-de538c381be5","block_type":"box","text":"and market risks (including the risk that market","page_number":180,"box":{"x":519,"y":769,"width":340,"height":12}},{"id":"0d28e421-d130-47a2-bed0-d8c7aac4317f","block_type":"box","text":"events, including but not limited to corporate actions,","page_number":180,"box":{"x":116,"y":785,"width":381,"height":12}},{"id":"73bd77ac-ee19-4652-9edb-265e4eff977c","block_type":"box","text":"could lead a Fund to lend securities that are trading","page_number":180,"box":{"x":504,"y":785,"width":372,"height":12}},{"id":"4727912c-9eac-43ac-83c7-fb2b68f8e844","block_type":"box","text":"at a premium due to increased demand, or to recall loaned","page_number":180,"box":{"x":116,"y":800,"width":425,"height":12}},{"id":"e77898d3-5a91-4416-a235-6859d4d33d48","block_type":"box","text":"securities or to lend less or not at all, which","page_number":180,"box":{"x":547,"y":800,"width":312,"height":11}},{"id":"a98b24d1-1f16-4626-bd7a-da304e9b191e","block_type":"box","text":"could lead to reduced securities lending revenue). If a Fund","page_number":180,"box":{"x":116,"y":816,"width":431,"height":12}},{"id":"a3fb0806-a9e9-4bca-a32f-171418d29dfc","block_type":"box","text":"were to lend out securities that are subject to","page_number":180,"box":{"x":553,"y":816,"width":326,"height":12}},{"id":"3fa82345-addb-4738-a174-0d02a24ca83f","block_type":"box","text":"a corporate action and commit to the borrower a","page_number":180,"box":{"x":116,"y":831,"width":355,"height":12}},{"id":"655f5047-327e-471b-8edd-c25e99572b0e","block_type":"box","text":"particular election as determined by the Fund’s","page_number":180,"box":{"x":472,"y":831,"width":345,"height":12}},{"id":"2be81cb5-9581-471e-8157-f83a7402a252","block_type":"box","text":"investment adviser, the benefit the Fund would receive","page_number":180,"box":{"x":117,"y":847,"width":401,"height":11}},{"id":"0ee69878-89c8-4381-9d67-768a3914541e","block_type":"box","text":"in respect of committing to such election may or","page_number":180,"box":{"x":519,"y":847,"width":352,"height":12}},{"id":"1c39ae3a-90a0-43d3-8ecb-d003f08dc360","block_type":"box","text":"may not be less than the benefit the Fund would have received from making a different election in such","page_number":180,"box":{"x":117,"y":862,"width":752,"height":12}},{"id":"69eef989-6a2d-4d7e-beb5-5b1e04cdbcac","block_type":"box","text":"corporate action. If a securities lending counterparty","page_number":180,"box":{"x":116,"y":878,"width":377,"height":12}},{"id":"906b47c0-2ffb-47cd-aa96-15ab568d7724","block_type":"box","text":"y were to default, a Fund would be subject to the risk","page_number":180,"box":{"x":493,"y":878,"width":381,"height":12}},{"id":"28acf714-01d8-495e-a801-117a2c9bd526","block_type":"box","text":"II-93","page_number":180,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"28df1f24-f994-4947-bea6-cdedc528b3bf","block_type":"box","text":"NM1026U-6004382-180/605","page_number":180,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"42e16eb4-225d-41d0-bf25-376709b65c06","block_type":"box","text":"of a possible delay in receiving collateral or in re","page_number":181,"box":{"x":116,"y":87,"width":349,"height":12}},{"id":"c47e648e-b041-44d5-9808-06b6b9f9e997","block_type":"box","text":"covering the loaned securities, or to a possible loss of","page_number":181,"box":{"x":466,"y":87,"width":394,"height":12}},{"id":"fa8781e3-4640-49bb-8c54-10e630f92789","block_type":"box","text":"rights in the collateral. In the event a borrower does","page_number":181,"box":{"x":117,"y":103,"width":372,"height":12}},{"id":"7829f217-0e49-42a7-842b-c4bc77bab731","block_type":"box","text":"not return a Fund’s securities as agreed, the Fund’s","page_number":181,"box":{"x":489,"y":103,"width":386,"height":12}},{"id":"8e45b2cc-d5ea-48db-a198-d7ae5e3ea9c9","block_type":"box","text":"ability to participate in a corporate action event ma","page_number":181,"box":{"x":116,"y":118,"width":366,"height":12}},{"id":"ccb793e2-53e0-4e70-a36a-5c1084dafbb2","block_type":"box","text":"y be impacted, or the Fund may experience losses if","page_number":181,"box":{"x":482,"y":118,"width":386,"height":12}},{"id":"cb476e66-7d1c-43f9-82c7-d2bbe094e698","block_type":"box","text":"the proceeds received from liquidating the collateral do","page_number":181,"box":{"x":116,"y":134,"width":403,"height":12}},{"id":"28ca23e3-fe37-4f84-9fae-c9b53e394e6e","block_type":"box","text":"not at least equal the value of the loaned security","page_number":181,"box":{"x":520,"y":134,"width":361,"height":12}},{"id":"88b7c911-bfdc-4eca-9416-381c5933f97e","block_type":"box","text":"at the time the collateral is liquidated, plus the t","page_number":181,"box":{"x":116,"y":149,"width":337,"height":12}},{"id":"e92c7875-9633-4ad2-97c1-53bc359e0aef","block_type":"box","text":"transaction costs incurred in purchasing replacement","page_number":181,"box":{"x":453,"y":149,"width":389,"height":12}},{"id":"51eed3f0-e6cd-4468-b9d4-44b4755f1b0e","block_type":"box","text":"securities. This latter event could trigger adverse tax consequences for a Fund. A Fund could lose money","page_number":181,"box":{"x":116,"y":165,"width":770,"height":12}},{"id":"cbb8f738-32dc-42a9-b0bb-1a3eabc4465c","block_type":"box","text":"if its short-term investment of the collateral declines","page_number":181,"box":{"x":117,"y":180,"width":377,"height":10}},{"id":"5b5af1f2-80db-462b-9da0-6334adc7e82a","block_type":"box","text":"in value over the period of the loan. Substitute","page_number":181,"box":{"x":495,"y":180,"width":338,"height":12}},{"id":"f4775410-be12-4b8d-a1f4-67ea339f1ba3","block_type":"box","text":"payments received by a Fund representing dividends","page_number":181,"box":{"x":117,"y":196,"width":390,"height":12}},{"id":"28e0a473-be21-4751-ba85-dac836cd5d31","block_type":"box","text":"paid on securities loaned out by the Fund will not","page_number":181,"box":{"x":508,"y":196,"width":359,"height":12}},{"id":"4f2f4801-8ab0-41c6-8c6a-9841fca65bdc","block_type":"box","text":"be considered qualified dividend income, and distributions by the Fund of such substitute payments will","page_number":181,"box":{"x":117,"y":211,"width":752,"height":12}},{"id":"04d9094c-163d-481d-b3ad-90241571b2d5","block_type":"box","text":"not constitute qualified dividend income. Additi","page_number":181,"box":{"x":117,"y":227,"width":335,"height":11}},{"id":"9a1e14bd-5b29-4885-a99d-23cf900642f0","block_type":"box","text":"onally, substitute payments received by a Fund","page_number":181,"box":{"x":453,"y":227,"width":347,"height":12}},{"id":"c1634355-e75e-443a-861c-b1472d35f223","block_type":"box","text":"representing qualified REIT dividends paid on REI","page_number":181,"box":{"x":117,"y":242,"width":361,"height":12}},{"id":"b50b9c41-4212-4276-a773-f757a008f33d","block_type":"box","text":"T securities loaned out by the Fund will not be","page_number":181,"box":{"x":480,"y":242,"width":339,"height":12}},{"id":"5dfa219c-d4ff-4dda-a472-b925534569c6","block_type":"box","text":"considered qualified REIT dividends, and distributions","page_number":181,"box":{"x":116,"y":258,"width":395,"height":11}},{"id":"e62f57b4-3322-4452-9413-1d36e9be81a1","block_type":"box","text":"by the Fund of such substitute payments will not","page_number":181,"box":{"x":512,"y":258,"width":354,"height":12}},{"id":"e9aff431-f9a0-4816-848a-7e1c5e17e6f8","block_type":"box","text":"be eligible for a 20% deduction currently availabl","page_number":181,"box":{"x":117,"y":273,"width":350,"height":12}},{"id":"8426d3ed-733f-41e3-ae1e-3c7f7e1c440f","block_type":"box","text":"e for ordinary REIT dividends paid to non-corporate","page_number":181,"box":{"x":469,"y":273,"width":378,"height":12}},{"id":"3be12626-ee97-418f-a2d6-5546ea1cbf8f","block_type":"box","text":"shareholders provided certain other requirements are sa","page_number":181,"box":{"x":116,"y":289,"width":409,"height":12}},{"id":"bc24d64c-521f-4316-8a6d-e0e5d22b8ae9","block_type":"box","text":"tisfied. The securities lending agent will take into","page_number":181,"box":{"x":526,"y":289,"width":356,"height":12}},{"id":"7372c9cf-eeee-4a9e-afe2-d950ee021ddf","block_type":"box","text":"account the tax effects on shareholders caused by","page_number":181,"box":{"x":116,"y":304,"width":367,"height":12}},{"id":"d176557e-c4a5-4b34-a852-1cf557fbd0ba","block_type":"box","text":"y these differences in connection with a Fund’s","page_number":181,"box":{"x":483,"y":304,"width":337,"height":10}},{"id":"360559b2-5e22-4015-8229-73e0771680d5","block_type":"box","text":"securities lending program. Substitute payments re","page_number":181,"box":{"x":116,"y":320,"width":370,"height":12}},{"id":"3653cc8f-87cc-4693-b254-2649fbd84f31","block_type":"box","text":"ceived on tax-exempt securities loaned out will not be","page_number":181,"box":{"x":487,"y":320,"width":393,"height":12}},{"id":"279dcf03-ebb7-4208-9ca0-a066dc091679","block_type":"box","text":"tax-exempt income. There could also be changes in","page_number":181,"box":{"x":116,"y":335,"width":376,"height":12}},{"id":"46efea29-020c-4697-b88d-5480b5ac1131","block_type":"box","text":"the status of issuers under applicable laws and","page_number":181,"box":{"x":493,"y":335,"width":350,"height":12}},{"id":"28caac47-18e4-4794-a718-861cbdee6b2f","block_type":"box","text":"regulations, including tax regulations, that may impact t","page_number":181,"box":{"x":117,"y":351,"width":395,"height":12}},{"id":"00765bc7-6eb3-411d-8944-4456f9ac5229","block_type":"box","text":"the regulatory or tax treatment of loaned securities","page_number":181,"box":{"x":512,"y":351,"width":371,"height":12}},{"id":"19da33bd-4fa6-4dcc-8cfe-318de68a6299","block_type":"box","text":"and could, for example, result in a delay in t","page_number":181,"box":{"x":116,"y":366,"width":317,"height":12}},{"id":"fc677dee-caa5-4b2d-8e0c-7870f1a92c72","block_type":"box","text":"he payment of dividend equivalent payments owed to a Fund","page_number":181,"box":{"x":434,"y":366,"width":448,"height":12}},{"id":"f14ee982-1218-4945-8fc5-054a3bc12d43","block_type":"box","text":"(as permitted by applicable law).","page_number":181,"box":{"x":117,"y":382,"width":239,"height":12}},{"id":"acbcab9d-dade-497a-8262-9962b7fe9df8","block_type":"box","text":"Regulations adopted by global prudential regulators require certain bank-regulated counterparties and","page_number":181,"box":{"x":117,"y":413,"width":761,"height":12}},{"id":"18362256-59a6-43fa-b34c-955f53aa82c7","block_type":"box","text":"certain of their affiliates to include in certain financial contracts, including many securities lending","page_number":181,"box":{"x":116,"y":428,"width":723,"height":12}},{"id":"a872093e-7061-45ae-bede-04a1e47d6149","block_type":"box","text":"agreements, terms that delay or restrict the rights of counterparties, such as the Fund, to terminate","page_number":181,"box":{"x":116,"y":444,"width":739,"height":12}},{"id":"02bbb51b-61fd-43f7-8277-cf03a5476815","block_type":"box","text":"such agreements, foreclose upon collateral, exercise other default rights or restrict transfers of credit","page_number":181,"box":{"x":116,"y":459,"width":751,"height":12}},{"id":"3f80d0f1-59e7-4c91-bdb2-0a8db9a282f4","block_type":"box","text":"support in the event that the counterparty and/or its affiliates are subject to certain types of resolution","page_number":181,"box":{"x":116,"y":475,"width":754,"height":12}},{"id":"d880cab5-ec49-4832-83ff-181a69341fde","block_type":"box","text":"or insolvency proceedings. It is possible that these requirements, as well as potential additional","page_number":181,"box":{"x":116,"y":490,"width":711,"height":12}},{"id":"2ab0276b-5b5f-4086-a7b2-b851f7740bf7","block_type":"box","text":"government regulation and other developments in the market, could adversely affect the Fund’s ability","page_number":181,"box":{"x":116,"y":506,"width":762,"height":12}},{"id":"07455681-743f-4221-8263-d16b8bacb375","block_type":"box","text":"to terminate existing securities lending agreements or to realize amounts to be received under such","page_number":181,"box":{"x":116,"y":521,"width":744,"height":12}},{"id":"a2c2f3ac-f726-47db-b029-1e28342e5a90","block_type":"box","text":"agreements. Prudential regulation may also favor lenders that can provide additional protections, such","page_number":181,"box":{"x":116,"y":537,"width":764,"height":12}},{"id":"79c6783b-1984-4988-92ab-49c254a7791c","block_type":"box","text":"as liens that are exercisable in connection with a lender default, to borrowers. Certain Funds expect to","page_number":181,"box":{"x":116,"y":552,"width":763,"height":12}},{"id":"66b728e4-f481-4292-8ca4-cd2e6b273c8f","block_type":"box","text":"provide additional protections to borrowers, where permitted pursuant to a Fund’s investment policies","page_number":181,"box":{"x":117,"y":568,"width":756,"height":12}},{"id":"0769ae99-7dab-4281-8c45-8b6b6c82c2fc","block_type":"box","text":"and if BlackRock believes doing so is in the best interest of the Fund.","page_number":181,"box":{"x":116,"y":583,"width":518,"height":12}},{"id":"14efe6fc-a016-41ea-8f14-5a5459ba81d6","block_type":"box","text":"The SEC has adopted a rule that will require reporting and public disclosure of securities loan","page_number":181,"box":{"x":116,"y":614,"width":698,"height":12}},{"id":"0370f7b9-995c-42b6-a821-3d05296aada8","block_type":"box","text":"transaction information (not including party names); this may include, but is not limited to, information","page_number":181,"box":{"x":116,"y":630,"width":755,"height":12}},{"id":"f46392fc-e3cd-4df6-b4d9-ab7953eef608","block_type":"box","text":"about securities loans entered into in connection with short sales. Compliance with this rule is expected","page_number":181,"box":{"x":116,"y":645,"width":771,"height":12}},{"id":"8b7b5ee2-25d6-45cf-8da7-0a0d3c362373","block_type":"box","text":"to be required in late 2028, although in response to the outcome of a legal challenge against the rule,","page_number":181,"box":{"x":116,"y":661,"width":750,"height":12}},{"id":"68f4b6a9-372d-44f7-892e-72093e775d93","block_type":"box","text":"the SEC may amend the rule and/or delay the current expected compliance date.","page_number":181,"box":{"x":116,"y":676,"width":602,"height":12}},{"id":"a118b663-b013-4828-8926-1df757b1f601","block_type":"box","text":"Short Sales.","page_number":181,"box":{"x":117,"y":707,"width":95,"height":10}},{"id":"be745bdb-7bfe-4fea-adb0-eb7bf2678486","block_type":"box","text":"Certain Funds may make short sales of securities, either as a hedge against potential","page_number":181,"box":{"x":219,"y":707,"width":633,"height":12}},{"id":"b6bb8253-bb5c-464c-99a3-79d6763a3ae4","block_type":"box","text":"declines in value of a portfolio security or to realize appreciation when a security that the Fund does","page_number":181,"box":{"x":116,"y":723,"width":739,"height":12}},{"id":"3fd50b28-051b-4ea3-be14-6c31169eeae2","block_type":"box","text":"not own declines in value. Certain Funds have a fundamental investment restriction prohibiting short","page_number":181,"box":{"x":117,"y":738,"width":742,"height":12}},{"id":"d7ba8415-190b-48b7-9fec-0e80fe667d83","block_type":"box","text":"sales of securities unless they are “against-the-box.” In a short sale “against-the-box,” at the time of the","page_number":181,"box":{"x":116,"y":754,"width":766,"height":12}},{"id":"cfbf254f-abe6-4d13-aa25-7f26892b2c9c","block_type":"box","text":"sale, the Fund owns or has the immediate and unconditional right to acquire the identical security at no","page_number":181,"box":{"x":116,"y":769,"width":764,"height":12}},{"id":"994d0ec2-0b6c-42b6-a4ea-895a87ad5185","block_type":"box","text":"additional cost. When a Fund makes a short sale, it borrows the security sold short and delivers it to","page_number":181,"box":{"x":116,"y":785,"width":741,"height":12}},{"id":"c94a4998-2c76-45fc-831d-668e0b453def","block_type":"box","text":"the broker-dealer through which it made the short sale. A Fund may have to pay a fee to borrow","page_number":181,"box":{"x":116,"y":800,"width":712,"height":12}},{"id":"26a1a91c-6fb6-4a5d-af2f-be76d57b2af4","block_type":"box","text":"particular securities and is often obligated to turn over any payments received on such borrowed","page_number":181,"box":{"x":117,"y":816,"width":713,"height":12}},{"id":"b1a29777-ddd3-4acb-a818-3ee05392e496","block_type":"box","text":"securities to the lender of the securities.","page_number":181,"box":{"x":116,"y":831,"width":301,"height":10}},{"id":"c81cda61-5e8e-4177-8873-11b3000d9c05","block_type":"box","text":"A Fund secures its obligation to replace the borrowed security by depositing collateral with the broker","page_number":181,"box":{"x":116,"y":862,"width":756,"height":12}},{"id":"9494b5fc-b3cd-41d7-b1f0-e6eb50f9be30","block_type":"box","text":"dealer, usually in cash, U.S. Government Securities or other liquid securities similar to those borrowed.","page_number":181,"box":{"x":116,"y":878,"width":769,"height":12}},{"id":"a9ebf182-05f8-4419-9763-09700c700f30","block_type":"box","text":"II-94","page_number":181,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"acb264a4-b18e-45ef-8fd6-10987531bdef","block_type":"box","text":"NM1026U-6004382-181/605","page_number":181,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"0041e8f5-c0ed-44fd-92af-49a085cc2956","block_type":"box","text":"With respect to uncovered short positions, a Fund is required to deposit similar collateral with its","page_number":182,"box":{"x":116,"y":87,"width":717,"height":12}},{"id":"3d9ca96e-90a4-4b7b-838f-eb9b5f199c0f","block_type":"box","text":"custodian, if necessary, to the extent that the value of both collateral deposits in the aggregate is at all","page_number":182,"box":{"x":116,"y":102,"width":763,"height":13}},{"id":"dfd74bc1-f6f2-4afc-80fe-abd8b99add42","block_type":"box","text":"times equal to at least 100% of the current market value of the security sold short. Depending on","page_number":182,"box":{"x":116,"y":118,"width":722,"height":12}},{"id":"a3ab212e-aa2f-426c-a70f-619ca2f6c7e5","block_type":"box","text":"arrangements made with the broker-dealer from which the Fund borrowed the security, regarding","page_number":182,"box":{"x":116,"y":134,"width":726,"height":12}},{"id":"b587a361-0602-4333-a6c2-10a2b1c8e0c9","block_type":"box","text":"payment received by the Fund on such security, a Fund may not receive any payments (including","page_number":182,"box":{"x":117,"y":149,"width":728,"height":12}},{"id":"3266bfb0-e4fe-45bf-b2b2-195a098599b1","block_type":"box","text":"interest) on its collateral deposited with such broker-dealer.","page_number":182,"box":{"x":117,"y":165,"width":443,"height":12}},{"id":"429c2619-6b5f-4fbb-839d-2b507f382085","block_type":"box","text":"Because making short sales in securities that it does not own exposes a Fund to the risks associated","page_number":182,"box":{"x":117,"y":196,"width":754,"height":12}},{"id":"f7c6a3c0-c98c-4dfa-a3a1-a3b9816c45ea","block_type":"box","text":"with those securities, such short sales involve speculative exposure risk. A Fund will incur a loss as a","page_number":182,"box":{"x":116,"y":211,"width":755,"height":12}},{"id":"053c86fc-3ac2-47f5-9870-4306f0929522","block_type":"box","text":"result of a short sale if the price of the security increases between the date of the short sale and the","page_number":182,"box":{"x":117,"y":227,"width":743,"height":12}},{"id":"67ac097c-5e3d-44cd-99b4-63f1f7ddf149","block_type":"box","text":"date on which the Fund replaces the borrowed security. As a result, if a Fund makes short sales in","page_number":182,"box":{"x":116,"y":242,"width":735,"height":12}},{"id":"4ba045c5-886f-4e36-9bd2-93b15b8dc89d","block_type":"box","text":"securities that increase in value, it will likely underperform similar mutual funds that do not make short","page_number":182,"box":{"x":116,"y":258,"width":759,"height":12}},{"id":"60a5cadd-2c64-41af-a8ba-faaa6e121e74","block_type":"box","text":"sales in securities. A Fund will realize a gain on a short sale if the security declines in price between","page_number":182,"box":{"x":116,"y":273,"width":746,"height":12}},{"id":"792de8b4-08d5-4786-9cec-9c4da40213a9","block_type":"box","text":"those dates. There can be no assurance that a Fund will be able to close out a short sale position at","page_number":182,"box":{"x":116,"y":289,"width":747,"height":12}},{"id":"cd4a413a-6c95-46b1-b1c4-eafb9299e52b","block_type":"box","text":"any particular time or at an acceptable price. Although a Fund’s gain is limited to the price at which it","page_number":182,"box":{"x":116,"y":304,"width":750,"height":12}},{"id":"88d6a5c7-9f87-4c37-a324-1554fdf77389","block_type":"box","text":"sold the security short, its potential loss is limited only by the maximum attainable price of the security,","page_number":182,"box":{"x":116,"y":320,"width":764,"height":12}},{"id":"bb41d5e5-69d3-47ff-9bf3-11cbe63de4e4","block_type":"box","text":"less the price at which the security was sold and may, theoretically, be unlimited.","page_number":182,"box":{"x":117,"y":335,"width":603,"height":12}},{"id":"28661acf-be53-43d5-9f72-8d4d66925a98","block_type":"box","text":"A Fund may also make short sales “against the box” without being subject to such limitations.","page_number":182,"box":{"x":116,"y":366,"width":698,"height":12}},{"id":"98510d27-54d8-412d-9c38-edcc617aef33","block_type":"box","text":"A Fund must comply with Rule 18f-4 under the Investment Company Act with respect to its short","page_number":182,"box":{"x":116,"y":397,"width":720,"height":12}},{"id":"02a5ed0d-a62c-4a2e-b311-26902c50d52e","block_type":"box","text":"sale borrowings, which are considered Derivatives Transactions under the Rule. See","page_number":182,"box":{"x":116,"y":413,"width":634,"height":12}},{"id":"1d41fbbe-b228-434c-8138-ba6cb44fe123","block_type":"box","text":"“—Derivatives—Regulation of Derivatives—Rule 18f-4 under the Investment Company Act” above.","page_number":182,"box":{"x":116,"y":428,"width":738,"height":12}},{"id":"5c25bc04-b0b9-432a-b328-4db07307e5ef","block_type":"box","text":"Short sales are also subject to certain SEC regulations and certain European Union and United","page_number":182,"box":{"x":116,"y":459,"width":712,"height":12}},{"id":"51819c9b-a46b-4818-95d3-6708777ffcfa","block_type":"box","text":"Kingdom regulations (under which there are restrictions on net short sales in certain securities). If the","page_number":182,"box":{"x":117,"y":475,"width":755,"height":12}},{"id":"4ba90744-a5dd-49f5-8951-1f9d6f62c3ab","block_type":"box","text":"SEC or regulatory authorities in other jurisdictions were to adopt additional restrictions regarding short","page_number":182,"box":{"x":116,"y":490,"width":761,"height":12}},{"id":"130f3b7b-52a3-4f7f-9e88-4b040b591abb","block_type":"box","text":"sales, they could restrict a Fund’s ability to engage in short sales in certain circumstances, and the","page_number":182,"box":{"x":116,"y":506,"width":736,"height":12}},{"id":"d33b6306-07e1-44cd-8431-4fae3ad01269","block_type":"box","text":"Fund may be unable to execute its investment strategy as a result. In response to market events, the","page_number":182,"box":{"x":117,"y":521,"width":753,"height":12}},{"id":"e0ac2221-8550-4658-9ef5-b47b7abc0999","block_type":"box","text":"SEC and regulatory authorities in other jurisdictions may adopt (and in certain cases, have adopted)","page_number":182,"box":{"x":116,"y":537,"width":747,"height":12}},{"id":"2e22bcc8-96ad-452f-815b-22e0b9058cfb","block_type":"box","text":"bans or other restrictions on short sales of certain securities or on derivatives and other hedging","page_number":182,"box":{"x":117,"y":552,"width":717,"height":12}},{"id":"4443c4d3-847f-4d00-bdb9-ae2469d3d7e3","block_type":"box","text":"instruments used to achieve a similar economic effect. Such bans or other restrictions may make it","page_number":182,"box":{"x":117,"y":568,"width":736,"height":12}},{"id":"8ecac63a-c8f9-4425-9699-dfaf4ffb97eb","block_type":"box","text":"impossible for a Fund to execute certain investment strategies and may have a material adverse effect","page_number":182,"box":{"x":117,"y":583,"width":765,"height":12}},{"id":"9d9c3178-fee3-493f-bce3-5a78209c0f98","block_type":"box","text":"on the Fund’s ability to generate returns.","page_number":182,"box":{"x":116,"y":599,"width":306,"height":12}},{"id":"5a5d43be-cdde-441f-af87-3d504cd898da","block_type":"box","text":"Special Purpose Acquisition Companies.","page_number":182,"box":{"x":117,"y":630,"width":325,"height":12}},{"id":"1f84583d-4d21-43c1-9aa6-906785d3b9f0","block_type":"box","text":"A Fund may invest in stock, warrants, rights and other","page_number":182,"box":{"x":443,"y":630,"width":411,"height":12}},{"id":"ad6f9211-b507-4e0d-830a-c40b929e6995","block_type":"box","text":"interests issued by special purpose acquisition companies (“SPACs”) or similar special purpose entities","page_number":182,"box":{"x":117,"y":645,"width":770,"height":12}},{"id":"509f36dd-f7cd-4c56-b869-c9e5ae9e422c","block_type":"box","text":"that pool funds to seek potential acquisition opportunities, including the “founder’s” shares and","page_number":182,"box":{"x":116,"y":661,"width":698,"height":12}},{"id":"d7f050e6-a7de-42b0-b0af-f023c343f0a0","block_type":"box","text":"warrants described below. A SPAC is a publicly traded company that raises investment capital via an","page_number":182,"box":{"x":116,"y":676,"width":749,"height":12}},{"id":"885ca522-cf8a-42fe-a55a-48a0139dcfe5","block_type":"box","text":"IPO for the purpose of identifying and acquiring one or more operating businesses or assets. In","page_number":182,"box":{"x":117,"y":692,"width":705,"height":12}},{"id":"de8df725-0d62-487f-9c96-2bb19a990b5e","block_type":"box","text":"connection with forming a SPAC, the SPAC’s sponsors acquire “founder’s” shares, generally for","page_number":182,"box":{"x":116,"y":707,"width":712,"height":12}},{"id":"adb29898-3d58-4549-9472-376f176eec9e","block_type":"box","text":"nominal consideration, and warrants that will result in the sponsors owning a specified percentage","page_number":182,"box":{"x":117,"y":723,"width":726,"height":12}},{"id":"e462fcba-59de-4905-8e92-c7a3f85ba30f","block_type":"box","text":"(typically 20%) of the SPAC’s outstanding common stock upon completion of the IPO. At the time a","page_number":182,"box":{"x":117,"y":738,"width":735,"height":12}},{"id":"b29741b5-fc1d-4070-ae89-4e8d50a9071f","block_type":"box","text":"SPAC conducts an IPO, it has selected a management team but has not yet identified a specific","page_number":182,"box":{"x":116,"y":754,"width":713,"height":12}},{"id":"0a4b847e-23bf-4075-88c6-591858a53a77","block_type":"box","text":"acquisition opportunity. Unless and until an acquisition is completed, a SPAC generally invests its","page_number":182,"box":{"x":116,"y":769,"width":723,"height":12}},{"id":"936b4499-96ff-4fee-8575-861593e483ed","block_type":"box","text":"assets in U.S. Government securities, money market securities and cash. If an acquisition that meets","page_number":182,"box":{"x":116,"y":785,"width":751,"height":12}},{"id":"62aa9bcd-6a59-4237-baa4-a50af2acbe4d","block_type":"box","text":"the requirements for the SPAC is not completed within a pre-established period of time, the invested","page_number":182,"box":{"x":116,"y":800,"width":743,"height":12}},{"id":"da89b6d1-4f32-4704-b01c-80bd7c579891","block_type":"box","text":"funds are returned to the SPAC’s public shareholders, the warrants expire, and the “founder’s” shares","page_number":182,"box":{"x":116,"y":816,"width":755,"height":12}},{"id":"81dd62b6-b2de-468e-aaaf-504a0ad5f851","block_type":"box","text":"and such warrants become worthless. Because SPACs and similar entities are in essence “blank","page_number":182,"box":{"x":116,"y":831,"width":725,"height":10}},{"id":"c25565c7-511d-42b0-90f2-615dfc2002bb","block_type":"box","text":"check” companies without operating histories or ongoing business operations (other than identifying","page_number":182,"box":{"x":116,"y":847,"width":745,"height":12}},{"id":"d96e29d8-123a-4fc2-8d76-310c0d867e88","block_type":"box","text":"and pursuing acquisitions), the potential for the long-term capital appreciation of their securities is","page_number":182,"box":{"x":116,"y":862,"width":728,"height":12}},{"id":"49fb8d5a-e595-4468-b21b-e8262eeef5cc","block_type":"box","text":"particularly dependent on the ability of the SPAC’s management to identify and complete a profitable","page_number":182,"box":{"x":117,"y":878,"width":751,"height":12}},{"id":"5d53b663-61bd-4666-b484-d42f0e4eeea4","block_type":"box","text":"II-95","page_number":182,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"60ade28c-f6cb-4bda-97ce-8ca328216e24","block_type":"box","text":"NM1026U-6004382-182/605","page_number":182,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a5ce6adb-a0b9-4364-8d7a-77ed7cef9ab6","block_type":"box","text":"acquisition. There is no guarantee that the SPACs in which a Fund invests will complete an acquisition","page_number":183,"box":{"x":116,"y":87,"width":766,"height":12}},{"id":"43c4d2b7-d00b-416e-8e87-2485fe693af1","block_type":"box","text":"or that any acquisitions completed by the SPACs in which the Fund invests will be profitable. Some","page_number":183,"box":{"x":116,"y":102,"width":740,"height":13}},{"id":"eaf91ad4-1a9e-424c-b47b-5e8f56151e67","block_type":"box","text":"SPACs may pursue acquisitions only within certain industries or regions, which may ultimately lead to","page_number":183,"box":{"x":116,"y":118,"width":758,"height":12}},{"id":"c7b3d8cc-4058-4289-9a4a-7b885cc29020","block_type":"box","text":"an increase in the volatility of their prices following the acquisition. In addition, some of these securities","page_number":183,"box":{"x":116,"y":134,"width":768,"height":12}},{"id":"106b7206-2c6c-46e1-8f29-01fe515067a5","block_type":"box","text":"may be considered illiquid and/or subject to restrictions on resale.","page_number":183,"box":{"x":117,"y":149,"width":491,"height":12}},{"id":"d66e936b-1529-4892-94ed-5f1fbe4a7a04","block_type":"box","text":"Standby Commitment Agreements.","page_number":183,"box":{"x":117,"y":180,"width":278,"height":12}},{"id":"6b1666ca-6318-48cb-9b05-01915b786f97","block_type":"box","text":"Standby commitment agreements commit a Fund, for a stated","page_number":183,"box":{"x":396,"y":180,"width":471,"height":12}},{"id":"e37f5ec1-83b3-4958-b5ef-5ce7744779e2","block_type":"box","text":"period of time, to purchase a stated amount of securities that may be issued and sold to that Fund at","page_number":183,"box":{"x":117,"y":196,"width":750,"height":12}},{"id":"5b258b71-8464-4319-927c-73bf39fb8066","block_type":"box","text":"the option of the issuer. The price of the security is fixed at the time of the commitment. At the time of","page_number":183,"box":{"x":116,"y":211,"width":756,"height":12}},{"id":"8de702bb-265c-4e3e-bd62-8442ba525e48","block_type":"box","text":"entering into the agreement, a Fund is paid a commitment fee, regardless of whether or not the","page_number":183,"box":{"x":116,"y":227,"width":711,"height":12}},{"id":"fea569ad-84f4-4432-bc83-1ae982d38eea","block_type":"box","text":"security is ultimately issued. A Fund will enter into such agreements for the purpose of investing in the","page_number":183,"box":{"x":116,"y":242,"width":762,"height":12}},{"id":"ec7c6c90-7c54-477e-a088-f8fc547d4901","block_type":"box","text":"security underlying the commitment at a price that is considered advantageous to the Fund.","page_number":183,"box":{"x":116,"y":258,"width":685,"height":12}},{"id":"4d057354-314b-4dc2-8025-9941d6f4615c","block_type":"box","text":"There can be no assurance that the securities subject to a standby commitment will be issued, and the","page_number":183,"box":{"x":116,"y":289,"width":767,"height":12}},{"id":"8c28747b-676c-448a-8ff4-2cc3a696b744","block_type":"box","text":"value of the security, if issued, on the delivery date may be more or less than its purchase price. Since","page_number":183,"box":{"x":116,"y":304,"width":764,"height":12}},{"id":"60219b07-8529-421b-bfaa-9524c2a7f84b","block_type":"box","text":"the issuance of the security underlying the commitment is at the option of the issuer, the Fund may","page_number":183,"box":{"x":116,"y":320,"width":738,"height":12}},{"id":"4dad88f0-c1a9-4441-9ee6-837b2f25d740","block_type":"box","text":"bear the risk of a decline in the value of such security and may not benefit from an appreciation in the","page_number":183,"box":{"x":117,"y":335,"width":756,"height":12}},{"id":"c9b07596-f639-4e58-a30d-6325cae5169f","block_type":"box","text":"value of the security during the commitment period.","page_number":183,"box":{"x":116,"y":351,"width":386,"height":12}},{"id":"021d3dde-ac78-4680-a394-7567b1780b9c","block_type":"box","text":"The purchase of a security pursuant to a standby commitment agreement and the related commitment","page_number":183,"box":{"x":116,"y":382,"width":764,"height":12}},{"id":"8b1f502f-24ba-4976-bd99-9f58750297f5","block_type":"box","text":"fee will be recorded on the date on which the security can reasonably be expected to be issued, and","page_number":183,"box":{"x":116,"y":397,"width":749,"height":12}},{"id":"92be379a-5b50-4318-80ad-4b2555db250c","block_type":"box","text":"the value of the security thereafter will be reflected in the calculation of a Fund’s NAV. The cost basis","page_number":183,"box":{"x":116,"y":413,"width":755,"height":12}},{"id":"170967e4-ce63-421d-987d-db9ef8a51ab4","block_type":"box","text":"of the security will be adjusted by the amount of the commitment fee. In the event the security is not","page_number":183,"box":{"x":116,"y":428,"width":745,"height":12}},{"id":"d7d5309a-e0f6-4313-abed-62629324ddb1","block_type":"box","text":"issued, the commitment fee will be recorded as income on the expiration date of the standby","page_number":183,"box":{"x":117,"y":444,"width":690,"height":12}},{"id":"13afdeb9-3246-4e2d-ad5a-74a74b83863c","block_type":"box","text":"commitment.","page_number":183,"box":{"x":116,"y":459,"width":101,"height":10}},{"id":"b8c4e55e-e9d8-4169-a2f4-5dcb82b80c20","block_type":"box","text":"Standby commitments will only be entered into with dealers, banks and broker-dealers which, in the","page_number":183,"box":{"x":116,"y":490,"width":744,"height":12}},{"id":"1908c74a-bdbc-44ff-a476-e3b80f0d1bc6","block_type":"box","text":"Manager’s or sub-adviser’s opinion, present minimal credit risks. A Fund will acquire standby","page_number":183,"box":{"x":117,"y":506,"width":693,"height":12}},{"id":"5f6883c4-4119-4e76-8ce9-72d66d51c85f","block_type":"box","text":"commitments solely to facilitate portfolio liquidity and not to exercise its rights thereunder for trading","page_number":183,"box":{"x":116,"y":521,"width":744,"height":12}},{"id":"6fca1792-2bb6-45a2-817b-7a02752c49f0","block_type":"box","text":"purposes. Standby commitments will be valued at zero in determining NAV. Accordingly, where a Fund","page_number":183,"box":{"x":117,"y":537,"width":769,"height":12}},{"id":"a5d0a0b7-236d-4b89-8588-0376f40bea5f","block_type":"box","text":"pays directly or indirectly for a standby commitment, its cost will be reflected as an unrealized loss for","page_number":183,"box":{"x":117,"y":552,"width":756,"height":12}},{"id":"d0263bf7-1da8-4b60-a576-5f53e0acb275","block_type":"box","text":"the period during which the commitment is held by such Fund and will be reflected as a realized gain or","page_number":183,"box":{"x":116,"y":568,"width":771,"height":12}},{"id":"fa0a4a74-448c-43b4-8419-59cb581a36e3","block_type":"box","text":"loss when the commitment is exercised or expires.","page_number":183,"box":{"x":117,"y":583,"width":380,"height":12}},{"id":"040ffa5a-3060-4718-ba45-38dec328e59f","block_type":"box","text":"Stripped Securities.","page_number":183,"box":{"x":117,"y":614,"width":156,"height":12}},{"id":"2eb2b7fa-b6db-4940-aa5f-f9ae8fb05a93","block_type":"box","text":"Stripped securities are created when the issuer separates the interest and","page_number":183,"box":{"x":274,"y":614,"width":560,"height":12}},{"id":"7cdb5909-9efa-4cce-882b-064cf6c9bc6c","block_type":"box","text":"principal components of an instrument and sells them as separate securities. In general, one security is","page_number":183,"box":{"x":117,"y":630,"width":771,"height":12}},{"id":"86244669-1e53-4b0c-8d26-2622582ecc01","block_type":"box","text":"entitled to receive the interest payments on the underlying assets (the interest only or “IO” security)","page_number":183,"box":{"x":116,"y":645,"width":740,"height":12}},{"id":"e717a4e3-b55a-4ab9-9989-1e5169a86657","block_type":"box","text":"and the other to receive the principal payments (the principal only or “PO” security). Some stripped","page_number":183,"box":{"x":116,"y":661,"width":731,"height":12}},{"id":"7581a6c4-b2ac-473e-93fd-c87623e3ee22","block_type":"box","text":"securities may receive a combination of interest and principal payments. The yields to maturity on IOs","page_number":183,"box":{"x":116,"y":676,"width":755,"height":12}},{"id":"8e20f7cf-b457-412f-9044-3d11c22054d9","block_type":"box","text":"and POs are sensitive to the expected or anticipated rate of principal payments (including","page_number":183,"box":{"x":116,"y":692,"width":663,"height":12}},{"id":"2bc8efb8-b8d8-4605-a071-12b770da3e06","block_type":"box","text":"prepayments) on the related underlying assets, and principal payments may have a material effect on","page_number":183,"box":{"x":117,"y":707,"width":752,"height":12}},{"id":"2ef0f98c-99a7-4037-8a56-cb73f5fb88b6","block_type":"box","text":"yield to maturity. If the underlying assets experience greater than anticipated prepayments of principal,","page_number":183,"box":{"x":116,"y":723,"width":760,"height":12}},{"id":"92784c9b-945a-4652-b17e-52790ad1c070","block_type":"box","text":"a Fund may not fully recoup its initial investment in IOs. Conversely, if the underlying assets","page_number":183,"box":{"x":116,"y":738,"width":681,"height":12}},{"id":"bd3273c6-917f-4a84-a76a-cc0fe53feb65","block_type":"box","text":"experience less than anticipated prepayments of principal, the yield on POs could be adversely","page_number":183,"box":{"x":116,"y":754,"width":706,"height":12}},{"id":"a0133fdc-c760-4836-85ca-ad98e2a7c7e9","block_type":"box","text":"affected. Stripped securities may be highly sensitive to changes in interest rates and rates of","page_number":183,"box":{"x":116,"y":769,"width":687,"height":12}},{"id":"3b178b3c-bf4d-47d6-a3aa-3a33a30c2c69","block_type":"box","text":"prepayment.","page_number":183,"box":{"x":117,"y":785,"width":91,"height":12}},{"id":"eb7cb45e-f09b-4ca6-8cb2-9175bfaa6d97","block_type":"box","text":"Structured Notes.","page_number":183,"box":{"x":117,"y":816,"width":139,"height":9}},{"id":"968f67ac-67a8-4b4f-88fd-245c1971cbbe","block_type":"box","text":"Structured notes and other related instruments purchased by a Fund are generally","page_number":183,"box":{"x":262,"y":816,"width":612,"height":12}},{"id":"94b52069-4f23-422d-840b-8372a233e33b","block_type":"box","text":"privately negotiated debt obligations where the principal and/or interest is determined by reference to","page_number":183,"box":{"x":117,"y":831,"width":753,"height":12}},{"id":"c7fd08a9-96ee-432d-a2cd-82b26ba2a4c6","block_type":"box","text":"the performance of a specific asset, benchmark asset, market or interest rate (“reference measure”).","page_number":183,"box":{"x":116,"y":847,"width":751,"height":12}},{"id":"136d4ec0-d7cc-4e62-be62-05a6d9ff61f9","block_type":"box","text":"Issuers of structured notes generally include corporations and banks. The interest rate or the principal","page_number":183,"box":{"x":117,"y":862,"width":760,"height":12}},{"id":"9751e299-075e-487b-8e78-4a57c11887f5","block_type":"box","text":"amount payable upon maturity or redemption may increase or decrease, depending upon changes in","page_number":183,"box":{"x":116,"y":878,"width":754,"height":12}},{"id":"1b895435-6a91-4a25-9ff9-90a753b2d407","block_type":"box","text":"II-96","page_number":183,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"2f0c3a29-ee28-46ae-90ed-c3d109add4df","block_type":"box","text":"NM1026U-6004382-183/605","page_number":183,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f0106f2d-02b7-4010-88de-f14f02c74b1f","block_type":"box","text":"the value of the reference measure. The terms of a structured note may provide that, in certain","page_number":184,"box":{"x":116,"y":87,"width":708,"height":12}},{"id":"16f65ca7-5d5a-4de9-8a66-35da64865d4d","block_type":"box","text":"circumstances, no principal is due at maturity and, therefore, may result in a loss of invested capital by","page_number":184,"box":{"x":116,"y":102,"width":765,"height":13}},{"id":"2bc19049-b7c4-4db5-bcbe-a998616292cf","block_type":"box","text":"a Fund. The interest and/or principal payments that may be made on a structured product may vary","page_number":184,"box":{"x":116,"y":118,"width":743,"height":12}},{"id":"38ac1908-1d56-41b5-9855-54f444cac36d","block_type":"box","text":"widely, depending on a variety of factors, including the volatility of the reference measure.","page_number":184,"box":{"x":116,"y":134,"width":671,"height":12}},{"id":"92014007-663b-41d8-b541-92b0c070cef1","block_type":"box","text":"Structured notes may be positively or negatively indexed, so the appreciation of the reference measure","page_number":184,"box":{"x":116,"y":165,"width":770,"height":12}},{"id":"de301dd6-b278-40dd-948d-c292ca243ee5","block_type":"box","text":"may produce an increase or a decrease in the interest rate or the value of the principal at maturity. The","page_number":184,"box":{"x":117,"y":180,"width":768,"height":12}},{"id":"4abc6eb1-0f20-4657-a22b-43c5a8dbba67","block_type":"box","text":"rate of return on structured notes may be determined by applying a multiplier to the performance or","page_number":184,"box":{"x":117,"y":196,"width":739,"height":12}},{"id":"2a51a0a0-bad9-48c2-ac54-d85889c0784c","block_type":"box","text":"differential performance of reference measures. Application of a multiplier involves leverage that will","page_number":184,"box":{"x":116,"y":211,"width":746,"height":12}},{"id":"b436f854-172d-4bfd-bfc2-7607f29d9b5e","block_type":"box","text":"serve to magnify the potential for gain and the risk of loss.","page_number":184,"box":{"x":116,"y":227,"width":435,"height":12}},{"id":"cdaa27e7-795f-4f30-844e-74b783ccfdbd","block_type":"box","text":"The purchase of structured notes exposes a Fund to the credit risk of the issuer of the structured","page_number":184,"box":{"x":116,"y":258,"width":722,"height":11}},{"id":"c9d1b783-9b31-4d48-8444-a61000f45879","block_type":"box","text":"product. Structured notes may also be more volatile, less liquid, and more difficult to price accurately","page_number":184,"box":{"x":117,"y":273,"width":750,"height":12}},{"id":"b9047cf0-dcfa-499c-a052-339eb49b5818","block_type":"box","text":"than less complex securities and instruments or more traditional debt securities. The secondary market","page_number":184,"box":{"x":116,"y":289,"width":770,"height":12}},{"id":"523e0890-1b9a-4186-a3aa-a80a295191ed","block_type":"box","text":"for structured notes could be illiquid making them difficult to sell when the Fund determines to sell","page_number":184,"box":{"x":116,"y":304,"width":729,"height":12}},{"id":"b7eab466-4914-4212-975f-f6600bc2848e","block_type":"box","text":"them. The possible lack of a liquid secondary market for structured notes and the resulting inability of","page_number":184,"box":{"x":116,"y":320,"width":755,"height":12}},{"id":"49c050e4-976e-41ee-88fb-01faec1d863a","block_type":"box","text":"the Fund to sell a structured note could expose the Fund to losses and could make structured notes","page_number":184,"box":{"x":116,"y":335,"width":746,"height":12}},{"id":"90498b6c-a6ba-4e2a-8cd7-153b4c293915","block_type":"box","text":"more difficult for the Fund to value accurately.","page_number":184,"box":{"x":117,"y":351,"width":344,"height":12}},{"id":"09506ed8-9aeb-4d12-884d-1aa2b6fee5a2","block_type":"box","text":"Taxability Risk.","page_number":184,"box":{"x":118,"y":382,"width":119,"height":12}},{"id":"be6cc539-3f4f-4f90-8bbb-4ec58625a010","block_type":"box","text":"Certain of the Funds intend to minimize the payment of taxable income to","page_number":184,"box":{"x":238,"y":382,"width":555,"height":12}},{"id":"83d23ab7-b5a1-4851-8f78-d96470bd649e","block_type":"box","text":"shareholders by investing in tax-exempt or municipal securities in reliance at the time of purchase on","page_number":184,"box":{"x":116,"y":397,"width":753,"height":12}},{"id":"de05089a-f05d-422c-a05e-2162337c4891","block_type":"box","text":"an opinion of bond counsel to the issuer and, in the case of derivative securities, sponsors’ counsel,","page_number":184,"box":{"x":116,"y":413,"width":745,"height":12}},{"id":"d0600a59-e388-4013-88cc-9fe6a59417b1","block_type":"box","text":"that the interest paid on those securities will be excludable from gross income for U.S. federal income","page_number":184,"box":{"x":116,"y":428,"width":759,"height":12}},{"id":"1c357d43-8900-4741-8ec8-50f10d53d2bc","block_type":"box","text":"tax purposes. Such securities, however, may be determined to pay, or have paid, taxable income","page_number":184,"box":{"x":116,"y":444,"width":726,"height":12}},{"id":"2eff366e-3bcb-4a90-8dfd-809f496717e8","block_type":"box","text":"subsequent to the Fund’s acquisition of the securities. In that event, the IRS may demand that the","page_number":184,"box":{"x":116,"y":459,"width":731,"height":12}},{"id":"f8bab98e-c981-4eb6-ae86-a56c93ba4009","block_type":"box","text":"Fund pay U.S. federal income taxes on the affected interest income, and, if the Fund agrees to do so,","page_number":184,"box":{"x":117,"y":475,"width":758,"height":12}},{"id":"824e2075-35fc-49a4-b9f5-0542c9381f0a","block_type":"box","text":"the Fund’s yield could be adversely affected. In addition, the treatment of dividends previously paid or","page_number":184,"box":{"x":116,"y":490,"width":758,"height":12}},{"id":"ee54bcc3-b0fc-41f9-8aee-90b5b52e8c0d","block_type":"box","text":"to be paid by the Fund as “exempt interest dividends” could be adversely affected, subjecting the","page_number":184,"box":{"x":116,"y":506,"width":724,"height":12}},{"id":"1de3fbdc-4add-433a-bed1-78610de3b045","block_type":"box","text":"Fund’s shareholders to increased U.S. federal income tax liabilities. If the interest paid on any","page_number":184,"box":{"x":117,"y":521,"width":699,"height":12}},{"id":"98645766-9f6f-4fd5-972a-d47d47cc585b","block_type":"box","text":"tax-exempt or municipal security held by the Fund is subsequently determined to be taxable, the Fund","page_number":184,"box":{"x":116,"y":537,"width":762,"height":12}},{"id":"54561e7f-e88f-4b36-a593-3cd468bdb161","block_type":"box","text":"will dispose of that security as soon as reasonably practicable. In addition, future laws, regulations,","page_number":184,"box":{"x":116,"y":552,"width":738,"height":12}},{"id":"003becc7-d4b4-4309-abea-5400bbe22b10","block_type":"box","text":"rulings or court decisions may cause interest on municipal securities to be subject, directly or indirectly,","page_number":184,"box":{"x":117,"y":568,"width":769,"height":12}},{"id":"d9497932-6cf2-41d1-b040-0b903f8a2190","block_type":"box","text":"to U.S. federal income taxation or interest on state municipal securities to be subject to state or local","page_number":184,"box":{"x":116,"y":583,"width":749,"height":12}},{"id":"78fdccd5-1c03-434f-b9af-74bc436b9065","block_type":"box","text":"income taxation, or the value of state municipal securities to be subject to state or local intangible","page_number":184,"box":{"x":117,"y":599,"width":726,"height":12}},{"id":"713a9697-fc72-4a1b-a80b-92b8e3a58d3d","block_type":"box","text":"personal property tax, or may otherwise prevent the Fund from realizing the full current benefit of the","page_number":184,"box":{"x":117,"y":614,"width":750,"height":12}},{"id":"9788a93f-e46d-4836-8a87-b5278bf3441c","block_type":"box","text":"tax-exempt status of such securities. Any such change could also affect the market price of such","page_number":184,"box":{"x":116,"y":630,"width":721,"height":12}},{"id":"794c7553-842a-442b-b1fd-1457ebeb49f2","block_type":"box","text":"securities, and thus the value of an investment in the Fund.","page_number":184,"box":{"x":116,"y":645,"width":444,"height":11}},{"id":"ff1354b0-f0d6-4839-bdf4-d2e46dc405d2","block_type":"box","text":"Temporary Defensive Measures.","page_number":184,"box":{"x":118,"y":676,"width":252,"height":12}},{"id":"8d3a8cb4-5d2a-4acb-8a4d-98e39efa9c9c","block_type":"box","text":"As a temporary defensive measure, including to respond to adverse","page_number":184,"box":{"x":376,"y":676,"width":498,"height":12}},{"id":"0c6c3adc-4b06-4840-96db-b830c514873e","block_type":"box","text":"market, economic, political or other conditions, a Fund may depart from its principal investment","page_number":184,"box":{"x":117,"y":692,"width":697,"height":12}},{"id":"51eaf34a-4b83-41a2-b783-54f9649fd941","block_type":"box","text":"strategies and may invest without limitation in cash, high quality money market instruments, or other","page_number":184,"box":{"x":116,"y":707,"width":735,"height":12}},{"id":"27e5462b-4ec9-4653-b551-c7b0d81d4d29","block_type":"box","text":"short term investments. Certain Funds may also invest in cash and other such instruments pending","page_number":184,"box":{"x":116,"y":723,"width":727,"height":12}},{"id":"2732f30c-ec2d-4dbd-8dc0-fe4380c957be","block_type":"box","text":"investment or to meet anticipated redemption requests. High quality money market instruments include","page_number":184,"box":{"x":117,"y":738,"width":755,"height":12}},{"id":"8d86a8e6-31a2-48ea-b9d4-140d9720781d","block_type":"box","text":"U.S. Government obligations, U.S. Government agency obligations, dollar denominated obligations of","page_number":184,"box":{"x":117,"y":754,"width":746,"height":12}},{"id":"91490406-7129-4ead-b747-fdb8dfe3ec7b","block_type":"box","text":"foreign issuers, bank obligations, including U.S. subsidiaries and branches of foreign banks, corporate","page_number":184,"box":{"x":116,"y":769,"width":750,"height":12}},{"id":"440277af-20f2-4438-996c-fc3c228ade54","block_type":"box","text":"obligations, commercial paper, repurchase agreements and obligations of supranational organizations.","page_number":184,"box":{"x":116,"y":785,"width":753,"height":12}},{"id":"68343d18-fae0-4ed8-b512-c3f2efcb4598","block_type":"box","text":"Generally, such obligations will mature within one year from the date of settlement, but may mature","page_number":184,"box":{"x":117,"y":800,"width":727,"height":12}},{"id":"8f892765-ce73-41ce-b578-b4edaaeaa856","block_type":"box","text":"within two years from the date of settlement. Temporary defensive measures may affect a Fund’s ability","page_number":184,"box":{"x":116,"y":816,"width":762,"height":12}},{"id":"94aada72-06bb-4eb1-b673-9750c0f31fa0","block_type":"box","text":"to achieve its investment objective.","page_number":184,"box":{"x":116,"y":831,"width":262,"height":12}},{"id":"591e39e3-39b6-47f8-97f4-6f0634e7797e","block_type":"box","text":"U.S. Government Obligations.","page_number":184,"box":{"x":117,"y":862,"width":236,"height":12}},{"id":"4b6d812b-2adf-469d-849e-9a762912fe42","block_type":"box","text":"A Fund may purchase obligations issued or guaranteed by the U.S.","page_number":184,"box":{"x":354,"y":862,"width":510,"height":12}},{"id":"b395f3aa-ba99-45d3-9a83-f09e125a9c1b","block_type":"box","text":"Government and U.S. Government agencies and instrumentalities. Obligations of certain agencies and","page_number":184,"box":{"x":117,"y":878,"width":767,"height":12}},{"id":"1561ffd9-4c07-4f2c-8d25-030f2fa6c5c1","block_type":"box","text":"II-97","page_number":184,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"2cdb1c73-0170-49d1-a013-fbed2364744c","block_type":"box","text":"NM1026U-6004382-184/605","page_number":184,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"7930dd5b-2863-421f-975b-592034d8209b","block_type":"box","text":"instrumentalities of the U.S. Government are supported by the full faith and credit of the U.S. Treasury.","page_number":185,"box":{"x":117,"y":87,"width":767,"height":12}},{"id":"e43468d2-c538-4ac0-93ae-763a75c6d80f","block_type":"box","text":"Others are supported by the right of the issuer to borrow from the U.S. Treasury; and still others are","page_number":185,"box":{"x":116,"y":102,"width":745,"height":13}},{"id":"b4e36e9b-ee02-4930-a93a-06a2808360a6","block_type":"box","text":"supported only by the credit of the agency or instrumentality issuing the obligation. No assurance can","page_number":185,"box":{"x":116,"y":118,"width":757,"height":12}},{"id":"2d083578-c89b-4142-8f27-10b49ebdba3a","block_type":"box","text":"be given that the U.S. Government will provide financial support to U.S. Government-sponsored","page_number":185,"box":{"x":117,"y":134,"width":715,"height":12}},{"id":"535eb569-bd86-4dd6-9b98-edc63d831292","block_type":"box","text":"instrumentalities if it is not obligated to do so by law. Certain U.S. Treasury and agency securities may","page_number":185,"box":{"x":117,"y":149,"width":762,"height":12}},{"id":"3e9540e5-07af-44b8-9489-b9f179b906d1","block_type":"box","text":"be held by trusts that issue participation certificates (such as Treasury income growth receipts and","page_number":185,"box":{"x":117,"y":165,"width":734,"height":12}},{"id":"9340737d-968c-4007-a2c5-53a46bdf6d09","block_type":"box","text":"certificates of accrual on Treasury certificates). These certificates, as well as Treasury receipts and","page_number":185,"box":{"x":116,"y":180,"width":740,"height":12}},{"id":"15af2c87-4164-41c3-be83-3bc54d39772d","block_type":"box","text":"other stripped securities, represent beneficial ownership interests in either future interest payments or","page_number":185,"box":{"x":116,"y":196,"width":759,"height":12}},{"id":"c5390b31-7955-4652-815b-958309815638","block_type":"box","text":"the future principal payments on U.S. Government obligations. These instruments are issued at a","page_number":185,"box":{"x":116,"y":211,"width":727,"height":12}},{"id":"dd8ea1f4-5032-48f8-99f2-a636c11406fa","block_type":"box","text":"discount to their “face value” and may (particularly in the case of stripped mortgage-backed securities)","page_number":185,"box":{"x":116,"y":227,"width":763,"height":12}},{"id":"bf2147ec-3d64-4ef6-82eb-ea825a6334f6","block_type":"box","text":"exhibit greater price volatility than ordinary debt securities because of the manner in which their","page_number":185,"box":{"x":116,"y":242,"width":713,"height":12}},{"id":"7eb26eb9-a963-48c9-b270-f79735fef335","block_type":"box","text":"principal and interest are returned to investors.","page_number":185,"box":{"x":117,"y":258,"width":351,"height":11}},{"id":"3754a946-c957-4f83-ad20-a5431458c0d6","block_type":"box","text":"Examples of the types of U.S. Government obligations that may be held by the Funds include U.S.","page_number":185,"box":{"x":117,"y":289,"width":734,"height":12}},{"id":"380e0fee-f26c-4b8e-9c3b-e7abc0743790","block_type":"box","text":"Treasury Bills, Treasury Notes and Treasury Bonds and the obligations of the Federal Housing","page_number":185,"box":{"x":116,"y":304,"width":708,"height":12}},{"id":"1a8b7c1e-fc93-49e5-886f-2bde26bc86f8","block_type":"box","text":"Administration, Farmers Home Administration, Export-Import Bank of the United States, Small","page_number":185,"box":{"x":116,"y":320,"width":703,"height":12}},{"id":"925894d4-8cdc-4c21-8968-e6ebbe67b74c","block_type":"box","text":"Business Administration, Ginnie Mae, Fannie Mae, Federal Financing Bank, General Services","page_number":185,"box":{"x":117,"y":335,"width":702,"height":12}},{"id":"428dfe56-e6d7-491e-9ab2-ed4ec72dce1e","block_type":"box","text":"Administration, Student Loan Marketing Association, Central Bank for Cooperatives, Federal Home","page_number":185,"box":{"x":116,"y":351,"width":741,"height":12}},{"id":"d3b5cdef-9e34-4a0e-b106-897ccbe6beea","block_type":"box","text":"Loan Banks, Freddie Mac, Federal Intermediate Credit Banks, Federal Land Banks, Farm Credit Banks","page_number":185,"box":{"x":117,"y":366,"width":771,"height":11}},{"id":"2b8cd254-273a-4d37-ba49-df9f30a1e40b","block_type":"box","text":"System, Maritime Administration, Tennessee Valley Authority and Washington D.C. Armory Board. The","page_number":185,"box":{"x":116,"y":382,"width":772,"height":12}},{"id":"e15cda71-f97c-4935-b9df-a309a0546020","block_type":"box","text":"Funds may also invest in mortgage-related securities issued or guaranteed by U.S. Government","page_number":185,"box":{"x":117,"y":397,"width":717,"height":12}},{"id":"c01b9cec-3781-42bc-950e-b05363a24548","block_type":"box","text":"agencies and instrumentalities, including such instruments as obligations of Ginnie Mae, Fannie Mae","page_number":185,"box":{"x":116,"y":413,"width":754,"height":12}},{"id":"6a2fc676-6735-4b20-bfc5-1ac135d523af","block_type":"box","text":"and Freddie Mac.","page_number":185,"box":{"x":116,"y":428,"width":135,"height":10}},{"id":"c2cfb2b1-bbf8-4e1e-ba9a-ac4b5aad3f6d","block_type":"box","text":"U.S. Treasury Obligations.","page_number":185,"box":{"x":117,"y":459,"width":194,"height":12}},{"id":"bcc6194a-7aee-45fc-81f6-57cca550d66c","block_type":"box","text":"Treasury obligations may differ in their interest rates, maturities, times of","page_number":185,"box":{"x":313,"y":459,"width":548,"height":12}},{"id":"c8ffe5d8-82ef-4436-81cb-014d2e16ac10","block_type":"box","text":"issuance and other characteristics. Obligations of U.S. Government agencies and authorities are","page_number":185,"box":{"x":117,"y":475,"width":721,"height":12}},{"id":"faccc1ec-6a1b-4787-90ba-a7bce7b41ecb","block_type":"box","text":"supported by varying degrees of credit but generally are not backed by the full faith and credit of the","page_number":185,"box":{"x":116,"y":490,"width":747,"height":12}},{"id":"753ca9ad-504a-470a-8cee-29e35598eb8e","block_type":"box","text":"U.S. Government. No assurance can be given that the U.S. Government will provide financial support","page_number":185,"box":{"x":117,"y":506,"width":758,"height":12}},{"id":"dbac4b79-eb38-4ebd-89cf-1032627bcde6","block_type":"box","text":"to its agencies and authorities if it is not obligated by law to do so.","page_number":185,"box":{"x":116,"y":521,"width":493,"height":12}},{"id":"792c437d-9724-4cf7-889a-a9608945af33","block_type":"box","text":"U.S. Treasury Rolls.","page_number":185,"box":{"x":117,"y":552,"width":153,"height":12}},{"id":"dbd66f13-ce2a-42fc-af29-27b3193c7a8c","block_type":"box","text":"Certain Funds may invest in U.S. Treasury","page_number":185,"box":{"x":271,"y":552,"width":320,"height":12}},{"id":"d2a4720c-20da-49d7-a4dc-166cf962c529","block_type":"box","text":"rolls. In a U.S. Treasury roll transaction,","page_number":185,"box":{"x":592,"y":552,"width":292,"height":12}},{"id":"709af9c2-2992-44dd-b73e-9631ea87f6d4","block_type":"box","text":"the Fund sells a treasury security to a counterpa","page_number":185,"box":{"x":116,"y":568,"width":350,"height":12}},{"id":"0b2e4c2c-6d82-40b7-9fe9-291271e88819","block_type":"box","text":"rty with a simultaneous agreement to repurchase the","page_number":185,"box":{"x":468,"y":568,"width":387,"height":12}},{"id":"1bd13134-7e1c-4f15-8040-14fca43d4095","block_type":"box","text":"same security at an agreed upon price and future settl","page_number":185,"box":{"x":116,"y":583,"width":392,"height":12}},{"id":"81104456-3fff-4e5e-816b-dc9045996755","block_type":"box","text":"ement date. U.S. Treasury roll transactions may","page_number":185,"box":{"x":510,"y":583,"width":353,"height":12}},{"id":"0ff4c7c4-2aca-4440-ba86-20fd2ca0e58f","block_type":"box","text":"incrementally adjust the average maturity of a Fund’","page_number":185,"box":{"x":117,"y":599,"width":376,"height":12}},{"id":"877b37b0-45b1-4313-b22c-a6a732de3ade","block_type":"box","text":"s portfolio and increase the interest yield on the","page_number":185,"box":{"x":494,"y":599,"width":348,"height":12}},{"id":"15240809-04fe-4bb1-9efd-852eaf1145fb","block_type":"box","text":"Fund’s portfolio by extending the average maturity of the portfolio in a normal yield curve environment.","page_number":185,"box":{"x":117,"y":614,"width":746,"height":12}},{"id":"0207c40f-40ee-4688-ac57-3f93454914e4","block_type":"box","text":"During the period before the settlement","page_number":185,"box":{"x":117,"y":630,"width":284,"height":12}},{"id":"b67a9954-7ce9-4f4a-89b8-e547ab171d58","block_type":"box","text":"date of a U.S. Treasury roll, a","page_number":185,"box":{"x":401,"y":630,"width":224,"height":12}},{"id":"2a1c807c-57be-4259-a88b-d91628894ebe","block_type":"box","text":"Fund continues to earn interest on","page_number":185,"box":{"x":626,"y":630,"width":254,"height":9}},{"id":"69b5221d-daf1-4772-af77-34d64540667c","block_type":"box","text":"the securities it is selling; however, it does not earn in","page_number":185,"box":{"x":116,"y":645,"width":387,"height":12}},{"id":"a0f51154-f335-4a8c-a025-c63dabcaaa0a","block_type":"box","text":"terest on the securities it is purchasing until after the","page_number":185,"box":{"x":504,"y":645,"width":383,"height":12}},{"id":"747ed7d9-53d7-426f-8728-423c41b92b8b","block_type":"box","text":"settlement date. A Fund could suffer an opportunity loss","page_number":185,"box":{"x":116,"y":661,"width":406,"height":12}},{"id":"0dcdc240-8bc4-461e-af85-43f37276c290","block_type":"box","text":"if the counterparty to the U.S. Treasury roll","page_number":185,"box":{"x":528,"y":661,"width":308,"height":12}},{"id":"55b62ece-7b0c-45db-abe2-1f09a66dd403","block_type":"box","text":"transaction failed to perform its obligations on the settlement date.","page_number":185,"box":{"x":116,"y":676,"width":478,"height":12}},{"id":"f84ee4c5-687b-4436-8da4-dbecb53e1634","block_type":"box","text":"The market value of the securities that a Fund is required to purchase may decline below the agreed","page_number":185,"box":{"x":116,"y":707,"width":745,"height":12}},{"id":"480fd279-0bc5-4181-9886-0e0cdef466c1","block_type":"box","text":"upon purchase price of those securities. U.S. Treasury rolls are speculative techniques that can be","page_number":185,"box":{"x":117,"y":723,"width":732,"height":12}},{"id":"81782b9c-5c55-457b-8178-e4e4dcfbdbf5","block_type":"box","text":"deemed to involve leverage. There is no assurance that U.S. Treasury rolls can be successfully","page_number":185,"box":{"x":116,"y":738,"width":709,"height":12}},{"id":"997843d7-fffb-4782-8218-b07c1c05512c","block_type":"box","text":"employed.","page_number":185,"box":{"x":116,"y":754,"width":76,"height":12}},{"id":"60d87bc1-8425-48e8-b1ad-4a130b6d3b03","block_type":"box","text":"Utility Industries.","page_number":185,"box":{"x":117,"y":785,"width":134,"height":12}},{"id":"4621d5f2-0d15-452e-b8fd-924f24e621ee","block_type":"box","text":"Risks that are intrinsic to the utility industries include difficulty in obtaining an","page_number":185,"box":{"x":259,"y":785,"width":566,"height":12}},{"id":"a00f0dfc-0cb5-4a42-a816-3e46d77903e5","block_type":"box","text":"adequate return on invested capital, difficulty in financing large construction programs during an","page_number":185,"box":{"x":116,"y":800,"width":710,"height":12}},{"id":"9eee81a3-8eeb-4d76-ac44-acae3c23da24","block_type":"box","text":"inflationary period, restrictions on operations and increased cost and delays attributable to","page_number":185,"box":{"x":117,"y":816,"width":667,"height":12}},{"id":"3a580d72-5e27-4149-b767-17005e0c5572","block_type":"box","text":"environmental considerations and regulation, difficulty in raising capital in adequate amounts on","page_number":185,"box":{"x":116,"y":831,"width":715,"height":12}},{"id":"4e38610e-cb05-44e6-9df9-59a74ef2a5ae","block_type":"box","text":"reasonable terms in periods of high inflation and unsettled capital markets, technological innovations","page_number":185,"box":{"x":117,"y":847,"width":750,"height":12}},{"id":"b05e9ba8-594b-4b58-bb71-765e056b0eae","block_type":"box","text":"that may render existing plants, equipment or products obsolete, the potential impact of natural or","page_number":185,"box":{"x":116,"y":862,"width":729,"height":12}},{"id":"9d8aac15-ae87-499e-96bd-14931b2df487","block_type":"box","text":"man-made disasters, increased costs and reduced availability of certain types of fuel, occasional","page_number":185,"box":{"x":117,"y":878,"width":721,"height":12}},{"id":"74749a81-d864-44cc-91cc-418688eb0dbc","block_type":"box","text":"II-98","page_number":185,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"d7f9d734-eae6-4275-a7ec-42174ecbe460","block_type":"box","text":"NM1026U-6004382-185/605","page_number":185,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a7d5b656-4216-4dd4-ad50-5123048a3461","block_type":"box","text":"reduced availability and high costs of natural gas for resale, the effects of energy conservation, the","page_number":186,"box":{"x":117,"y":87,"width":736,"height":12}},{"id":"cfab2273-4316-45e9-b01d-45b902af08cb","block_type":"box","text":"effects of a national energy policy and lengthy delays and greatly increased costs and other problems","page_number":186,"box":{"x":116,"y":102,"width":759,"height":13}},{"id":"1ae246da-cb8d-42fa-b2d5-5b1deb79dabd","block_type":"box","text":"associated with the design, construction, licensing, regulation and operation of nuclear facilities for","page_number":186,"box":{"x":116,"y":118,"width":735,"height":12}},{"id":"6433fa46-2dbb-42e8-8300-7735ca07aeb6","block_type":"box","text":"electric generation, including, among other considerations, the problems associated with the use of","page_number":186,"box":{"x":116,"y":134,"width":740,"height":12}},{"id":"f6634909-99b4-40f6-920a-76a73214bab3","block_type":"box","text":"radioactive materials and the disposal of radioactive wastes. There are substantial differences among","page_number":186,"box":{"x":117,"y":149,"width":757,"height":12}},{"id":"fa50ce45-9b31-4b1b-b24f-94c4919331e7","block_type":"box","text":"the regulatory practices and policies of various jurisdictions, and any given regulatory agency may","page_number":186,"box":{"x":116,"y":165,"width":732,"height":12}},{"id":"a7fd6530-50db-4cdc-8227-4139d6f6c547","block_type":"box","text":"make major shifts in policy from time to time. There is no assurance that regulatory authorities will, in","page_number":186,"box":{"x":117,"y":180,"width":752,"height":12}},{"id":"913541dd-0c30-4dea-8c9c-682a0c8d0326","block_type":"box","text":"the future, grant rate increases or that such increases will be adequate to permit the payment of","page_number":186,"box":{"x":116,"y":196,"width":716,"height":12}},{"id":"ca10851c-f5dc-4345-be15-36be52f92e41","block_type":"box","text":"dividends on common stocks issued by a utility company. Additionally, existing and possible future","page_number":186,"box":{"x":116,"y":211,"width":735,"height":12}},{"id":"818c8058-e84b-4aec-812e-1b20897b1c4a","block_type":"box","text":"regulatory legislation may make it even more difficult for utilities to obtain adequate relief. Certain of the","page_number":186,"box":{"x":117,"y":227,"width":771,"height":12}},{"id":"f65ff740-ee1a-448d-aa99-415661144902","block_type":"box","text":"issuers of securities held in the Fund’s portfolio may own or operate nuclear generating facilities.","page_number":186,"box":{"x":117,"y":242,"width":720,"height":12}},{"id":"b83ba412-d043-4cd2-a704-78cf0f1f116e","block_type":"box","text":"Governmental authorities may from time to time review existing policies and impose additional","page_number":186,"box":{"x":117,"y":258,"width":702,"height":12}},{"id":"0cf9149a-e32d-4876-914f-cf9692b6274d","block_type":"box","text":"requirements governing the licensing, construction and operation of nuclear power plants. Prolonged","page_number":186,"box":{"x":117,"y":273,"width":751,"height":12}},{"id":"0e9bfe1b-9fee-4860-bfc7-f48afe4a6f53","block_type":"box","text":"changes in climatic conditions can also have a significant impact on both the revenues of an electric","page_number":186,"box":{"x":116,"y":289,"width":746,"height":12}},{"id":"73aae50d-c98a-4062-9bc1-d317fd5739ad","block_type":"box","text":"and gas utility as well as the expenses of a utility, particularly a hydro-based electric utility.","page_number":186,"box":{"x":116,"y":304,"width":675,"height":12}},{"id":"9839d1a4-3655-48b6-ac14-1a94e7b3d063","block_type":"box","text":"Companies in the utilities sector may be adversely affected by changes in exchange rates, domestic","page_number":186,"box":{"x":117,"y":335,"width":747,"height":12}},{"id":"38db35ad-892a-4e6d-a5b2-94a5fa7cac9c","block_type":"box","text":"and international competition, and governmental limitations on rates charged to customers. The value","page_number":186,"box":{"x":116,"y":351,"width":759,"height":12}},{"id":"a7fcbd60-b056-43e2-b3b8-a6b772460f22","block_type":"box","text":"of regulated utility debt securities and, to a lesser extent, equity securities, tends to have an inverse","page_number":186,"box":{"x":116,"y":366,"width":743,"height":12}},{"id":"ee87d828-d05f-4f5e-8055-7bed554d1bc9","block_type":"box","text":"relationship to the movement of interest rates and therefore may lead to volatility in performance.","page_number":186,"box":{"x":117,"y":382,"width":723,"height":12}},{"id":"99dd2f5f-ed7b-4a53-9abb-ad967a7406e6","block_type":"box","text":"Utility companies in the United States and in foreign countries are generally subject to regulation. In the","page_number":186,"box":{"x":117,"y":413,"width":771,"height":12}},{"id":"db52d1e3-2c2c-434a-8765-257b49ac2ef0","block_type":"box","text":"United States, most utility companies are regulated by state and/or federal authorities. Such regulation","page_number":186,"box":{"x":117,"y":428,"width":764,"height":12}},{"id":"1e153f22-0a0f-43f5-a2f6-7cbb9cec3eec","block_type":"box","text":"is intended to ensure appropriate standards of service and adequate capacity to meet public demand.","page_number":186,"box":{"x":117,"y":444,"width":759,"height":12}},{"id":"ba49388d-dc3a-47ca-822d-e9b0e972e04f","block_type":"box","text":"Generally, prices are also regulated in the United States and in foreign countries with the intention of","page_number":186,"box":{"x":117,"y":459,"width":750,"height":12}},{"id":"1a50f835-725b-4b23-a3b5-06123f777bd9","block_type":"box","text":"protecting the public while ensuring that the rate of return earned by utility companies is sufficient to","page_number":186,"box":{"x":117,"y":475,"width":744,"height":12}},{"id":"a9d74f63-7619-4894-92a7-f93e05c86b26","block_type":"box","text":"allow them to attract capital in order to grow and continue to provide appropriate services. There can","page_number":186,"box":{"x":116,"y":490,"width":751,"height":12}},{"id":"f760acc2-075c-4c10-b31e-2710bd7405b3","block_type":"box","text":"be no assurance that such pricing policies or rates of return will continue in the future.","page_number":186,"box":{"x":117,"y":506,"width":640,"height":12}},{"id":"763b8971-67f2-47e9-a817-5e5e3853dfb4","block_type":"box","text":"The nature of regulation of the utility industries continues to evolve both in the United States and in","page_number":186,"box":{"x":116,"y":537,"width":738,"height":12}},{"id":"cc0e911c-1843-4e50-881e-01b3dc6628e6","block_type":"box","text":"foreign countries. In recent years, changes in regulation in the United States increasingly have allowed","page_number":186,"box":{"x":116,"y":552,"width":767,"height":12}},{"id":"d7b45e08-5323-4065-ba0e-6d6022dd5da0","block_type":"box","text":"utility companies to provide services and products outside their traditional geographic areas and lines","page_number":186,"box":{"x":117,"y":568,"width":755,"height":12}},{"id":"3ecdb140-50ce-4a3d-8b28-76934ed89ff2","block_type":"box","text":"of business, creating new areas of competition within the industries. In some instances, utility","page_number":186,"box":{"x":116,"y":583,"width":696,"height":12}},{"id":"11587bbf-ed85-4ac7-a791-6282510faf77","block_type":"box","text":"companies are operating on an unregulated basis. Because of trends toward deregulation and the","page_number":186,"box":{"x":116,"y":599,"width":732,"height":12}},{"id":"cfa71d26-e41b-4d26-b006-097df39e7e8a","block_type":"box","text":"evolution of independent power producers as well as new entrants to the field of telecommunications,","page_number":186,"box":{"x":116,"y":614,"width":757,"height":12}},{"id":"bd9ccbc7-fb76-4c88-928f-45eca36dc501","block_type":"box","text":"non-regulated providers of utility services have become a significant part of their respective industries.","page_number":186,"box":{"x":117,"y":630,"width":761,"height":12}},{"id":"ff43e6b3-eb44-460a-8d21-c80b1c840894","block_type":"box","text":"The Manager believes that the emergence of competition and deregulation will result in certain utility","page_number":186,"box":{"x":116,"y":645,"width":750,"height":12}},{"id":"77b3b6b6-aa46-43ff-be26-932cc44a4851","block_type":"box","text":"companies being able to earn more than their traditional regulated rates of return, while others may be","page_number":186,"box":{"x":116,"y":661,"width":759,"height":12}},{"id":"c98cfbc5-822d-4390-9ab0-90c7bde2223d","block_type":"box","text":"forced to defend their core business from increased competition and may be less profitable. Reduced","page_number":186,"box":{"x":116,"y":676,"width":751,"height":12}},{"id":"43db4721-e462-4445-9d98-108d85d99396","block_type":"box","text":"profitability, as well as new uses of funds (such as for expansion, operations or stock buybacks) could","page_number":186,"box":{"x":117,"y":692,"width":754,"height":12}},{"id":"db6ffbfe-678c-4c19-b36f-6167622800f5","block_type":"box","text":"result in cuts in dividend payout rates. As deregulation allows utility companies to diversify outside of","page_number":186,"box":{"x":117,"y":707,"width":746,"height":12}},{"id":"a6d54604-3874-425b-a9f6-7c9cb6901e81","block_type":"box","text":"their original geographic regions and their traditional lines of business, utility companies may engage in","page_number":186,"box":{"x":116,"y":723,"width":764,"height":12}},{"id":"ad73fc19-4eff-4c0b-abac-d3466f56957d","block_type":"box","text":"riskier ventures. Therefore, deregulation may eliminate restrictions on the maximum level of profits of","page_number":186,"box":{"x":117,"y":738,"width":749,"height":12}},{"id":"85e5892e-62ad-4ba6-82d0-b95a9b8bb763","block_type":"box","text":"certain utility companies, but may also subject these companies to greater risk of loss. The Manager","page_number":186,"box":{"x":116,"y":754,"width":745,"height":12}},{"id":"131341af-ac0c-45c2-a502-795baccf5655","block_type":"box","text":"seeks to take advantage of favorable investment opportunities that may arise from these structural","page_number":186,"box":{"x":116,"y":769,"width":730,"height":12}},{"id":"e64ba902-e441-4bb5-b83a-10822431565d","block_type":"box","text":"changes. Of course, there can be no assurance that favorable developments will occur in the future.","page_number":186,"box":{"x":116,"y":785,"width":741,"height":12}},{"id":"8e43e0f0-a232-45bb-9301-2a57422d471b","block_type":"box","text":"Foreign utility companies are also subject to regulation, although such regulations may or may not be","page_number":186,"box":{"x":117,"y":816,"width":749,"height":12}},{"id":"736599f7-d2c6-44ca-9309-46d5868f70f8","block_type":"box","text":"comparable to those in the United States. Foreign utility companies may be more heavily regulated by","page_number":186,"box":{"x":116,"y":831,"width":761,"height":12}},{"id":"06254f48-f62f-4ec6-93b0-47a5d1dd99c5","block_type":"box","text":"their respective governments than utilities in the United States and, as in the United States, generally","page_number":186,"box":{"x":116,"y":847,"width":755,"height":12}},{"id":"9296b402-cb82-4a0a-bcb8-48284d7daf77","block_type":"box","text":"are required to seek government approval for rate increases. In addition, many foreign utilities use","page_number":186,"box":{"x":116,"y":862,"width":733,"height":12}},{"id":"7457b82a-4c79-427f-b381-b5a36ab74225","block_type":"box","text":"fuels that may cause more pollution than those used in the United States, which may require such","page_number":186,"box":{"x":116,"y":878,"width":731,"height":12}},{"id":"5a35fda6-a86f-4182-9f8c-54c5f77aa0ab","block_type":"box","text":"II-99","page_number":186,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"4437d0fe-2872-4ea5-9698-c1e2e9a8fcb6","block_type":"box","text":"NM1026U-6004382-186/605","page_number":186,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"1f271243-946c-4f54-8448-6e41c335e66a","block_type":"box","text":"utilities to invest in pollution control equipment to meet any proposed pollution restrictions. Foreign","page_number":187,"box":{"x":117,"y":87,"width":733,"height":12}},{"id":"e5f6c37c-290a-4c24-9705-b9d73299926b","block_type":"box","text":"regulatory systems vary from country to country and may evolve in ways different from regulation in the","page_number":187,"box":{"x":117,"y":102,"width":770,"height":13}},{"id":"8e32a280-7460-410a-b514-694f962d5955","block_type":"box","text":"United States.","page_number":187,"box":{"x":117,"y":118,"width":109,"height":10}},{"id":"cc9c5adf-0516-4e35-b8de-c3975c4da733","block_type":"box","text":"A Fund’s investment policies are designed to enable it to capitalize on evolving investment","page_number":187,"box":{"x":116,"y":149,"width":676,"height":12}},{"id":"903664a3-e125-4740-b3bd-660e7397bc8f","block_type":"box","text":"opportunities throughout the world. For example, the rapid growth of certain foreign economies will","page_number":187,"box":{"x":116,"y":165,"width":736,"height":12}},{"id":"22e56206-7ada-4e3a-9ff3-63af0af31b95","block_type":"box","text":"necessitate expansion of capacity in the utility industries in those countries. Although many foreign","page_number":187,"box":{"x":117,"y":180,"width":735,"height":12}},{"id":"c4b829e0-0ca9-47c0-a187-e0199f7635a7","block_type":"box","text":"utility companies currently are government-owned, thereby limiting current investment opportunities for","page_number":187,"box":{"x":117,"y":196,"width":766,"height":12}},{"id":"018348d2-6fe7-41c0-a29d-ae1945f17d75","block_type":"box","text":"a Fund, the Manager believes that, in order to attract significant capital for growth, foreign governments","page_number":187,"box":{"x":116,"y":211,"width":772,"height":12}},{"id":"96bd6a0e-3087-4419-86b5-4634a0bd8cb3","block_type":"box","text":"are likely to seek global investors through the privatization of their utility industries. Privatization, which","page_number":187,"box":{"x":116,"y":227,"width":765,"height":12}},{"id":"7d52d15e-6604-44a1-8f49-c350f9416dc6","block_type":"box","text":"refers to the trend toward investor ownership of assets rather than government ownership, is expected","page_number":187,"box":{"x":117,"y":242,"width":764,"height":12}},{"id":"0577abf8-6a50-472f-be3d-521ae811b0c1","block_type":"box","text":"to occur in newer, faster-growing economies and in mature economies. Of course, there is no","page_number":187,"box":{"x":116,"y":258,"width":699,"height":12}},{"id":"590a172f-8693-4bd8-8340-92988f180a71","block_type":"box","text":"assurance that such favorable developments will occur or that investment opportunities in foreign","page_number":187,"box":{"x":116,"y":273,"width":726,"height":12}},{"id":"e581b26c-e1ec-4eca-8578-17dd9c86f7ed","block_type":"box","text":"markets will increase.","page_number":187,"box":{"x":117,"y":289,"width":164,"height":9}},{"id":"0c029ad7-d95b-4cbb-b626-acd59ce77ba4","block_type":"box","text":"The revenues of domestic and foreign utility companies generally reflect the economic growth and","page_number":187,"box":{"x":116,"y":320,"width":732,"height":12}},{"id":"c7eaf055-0f9d-437b-b337-d8923a20c191","block_type":"box","text":"development in the geographic areas in which they do business. The Manager will take into account","page_number":187,"box":{"x":116,"y":335,"width":747,"height":12}},{"id":"21931e59-cb12-4185-8783-6b8f49e9eb8d","block_type":"box","text":"anticipated economic growth rates and other economic developments when selecting securities of","page_number":187,"box":{"x":116,"y":351,"width":732,"height":12}},{"id":"3923d1a9-9e24-4d1d-884d-bd640136dce1","block_type":"box","text":"utility companies.","page_number":187,"box":{"x":117,"y":366,"width":132,"height":12}},{"id":"88031c07-01bb-46a9-9c3d-1d88c2992fe9","block_type":"box","text":"Electric.","page_number":187,"box":{"x":116,"y":397,"width":58,"height":10}},{"id":"c18f1aee-c8c1-4a6f-9679-f67960793c68","block_type":"box","text":"The electric utility industry consists of companies that are engaged principally in the","page_number":187,"box":{"x":176,"y":397,"width":630,"height":12}},{"id":"8356297e-0307-466b-beab-ae381ff9aa7d","block_type":"box","text":"generation, transmission and sale of electric energy, although many also provide other energy-related","page_number":187,"box":{"x":116,"y":413,"width":760,"height":12}},{"id":"c5cc34ce-2fd0-4076-9dab-3c34e989e574","block_type":"box","text":"services. In the past, electric utility companies, in general, have been favorably affected by lower fuel","page_number":187,"box":{"x":116,"y":428,"width":754,"height":12}},{"id":"2fd558c7-4791-407a-ac46-b94871cc63fb","block_type":"box","text":"and financing costs and the full or near completion of major construction programs. In addition, many","page_number":187,"box":{"x":116,"y":444,"width":754,"height":12}},{"id":"9830bef2-8a47-40f7-ae3a-806d7d5522bf","block_type":"box","text":"of these companies have generated cash flows in excess of current operating expenses and","page_number":187,"box":{"x":116,"y":459,"width":690,"height":12}},{"id":"fb2bff44-3689-4014-a99f-b79a68b47960","block_type":"box","text":"construction expenditures, permitting some degree of diversification into unregulated businesses.","page_number":187,"box":{"x":116,"y":475,"width":727,"height":12}},{"id":"bede7a30-529c-4d05-9b67-b204d077f932","block_type":"box","text":"Some electric utilities have also taken advantage of the right to sell power outside of their traditional","page_number":187,"box":{"x":116,"y":490,"width":744,"height":12}},{"id":"2ae205ec-a4b4-4332-8c12-5ad40f0166bd","block_type":"box","text":"geographic areas. Electric utility companies have historically been subject to the risks associated with","page_number":187,"box":{"x":116,"y":506,"width":758,"height":12}},{"id":"0fe0a168-2d47-4404-bb30-68d403d81f42","block_type":"box","text":"increases in fuel and other operating costs, high interest costs on borrowings needed for capital","page_number":187,"box":{"x":117,"y":521,"width":714,"height":12}},{"id":"641215ce-1fd4-4d8e-af12-59ddec475474","block_type":"box","text":"construction programs, costs associated with compliance with environmental and safety regulations","page_number":187,"box":{"x":116,"y":537,"width":744,"height":12}},{"id":"e2b3e3ce-418e-4c05-b022-03e6f2ca381d","block_type":"box","text":"and changes in the regulatory climate. As interest rates declined, many utilities refinanced high cost","page_number":187,"box":{"x":116,"y":552,"width":744,"height":12}},{"id":"2b58dfa7-0895-42b5-8f7e-c44250fe45df","block_type":"box","text":"debt and in doing so improved their fixed charges coverage. Regulators, however, lowered allowed","page_number":187,"box":{"x":116,"y":568,"width":740,"height":12}},{"id":"d8abb122-a4b9-493c-8f61-d72d82a5024c","block_type":"box","text":"rates of return as interest rates declined and thereby caused the benefits of the rate declines to be","page_number":187,"box":{"x":117,"y":583,"width":734,"height":12}},{"id":"cb3a4ee9-239f-44d1-97e5-3b64b7f57c54","block_type":"box","text":"shared wholly or in part with customers. In a period of rising interest rates, the allowed rates of return","page_number":187,"box":{"x":116,"y":599,"width":754,"height":12}},{"id":"4285dc22-e558-485f-be3a-eba39917f871","block_type":"box","text":"may not keep pace with the utilities’ increased costs. The construction and operation of nuclear power","page_number":187,"box":{"x":117,"y":614,"width":760,"height":12}},{"id":"5b6fd89f-644e-4793-a54b-bb4177c490fc","block_type":"box","text":"facilities are subject to strict scrutiny by, and evolving regulations of, the Nuclear Regulatory","page_number":187,"box":{"x":116,"y":630,"width":686,"height":12}},{"id":"e01cb2bd-8e8c-48c3-b6ef-24f91093d70d","block_type":"box","text":"Commission and state agencies which have comparable jurisdiction. Strict scrutiny might result in","page_number":187,"box":{"x":117,"y":645,"width":727,"height":12}},{"id":"557d85af-5fa8-4228-ac9c-5554354cf51e","block_type":"box","text":"higher operating costs and higher capital expenditures, with the risk that the regulators may disallow","page_number":187,"box":{"x":117,"y":661,"width":743,"height":12}},{"id":"68c5b96b-be83-4f26-b0ec-579b3536b41a","block_type":"box","text":"inclusion of these costs in rate authorizations or the risk that a company may not be permitted to","page_number":187,"box":{"x":117,"y":676,"width":713,"height":12}},{"id":"0f283e01-3ce6-47d2-92f5-baa2c36a9b20","block_type":"box","text":"operate or complete construction of a facility. In addition, operators of nuclear power plants may be","page_number":187,"box":{"x":116,"y":692,"width":735,"height":12}},{"id":"4b4f4ba4-2f20-4b7c-9bfc-163309fdd7e1","block_type":"box","text":"subject to significant costs for disposal of nuclear fuel and for decommissioning such plants.","page_number":187,"box":{"x":116,"y":707,"width":681,"height":12}},{"id":"7bfac347-8a28-492f-889b-fbeb6acf371e","block_type":"box","text":"The rating agencies look closely at the business profile of utilities. Ratings for companies are expected","page_number":187,"box":{"x":116,"y":738,"width":760,"height":12}},{"id":"569effa0-0c3b-4832-8ef2-f8aa75098ac8","block_type":"box","text":"to be impacted to a greater extent in the future by the division of their asset base. Electric utility","page_number":187,"box":{"x":116,"y":754,"width":706,"height":12}},{"id":"fa8d1a95-b9e7-461c-854a-23b53d91bc36","block_type":"box","text":"companies that focus more on the generation of electricity may be assigned less favorable ratings as","page_number":187,"box":{"x":116,"y":769,"width":749,"height":12}},{"id":"9ee907c7-a06d-4794-9e63-7e38dff6cc2f","block_type":"box","text":"this business is expected to be competitive and the least regulated. On the other hand, companies that","page_number":187,"box":{"x":116,"y":785,"width":763,"height":12}},{"id":"181e223b-5a26-44d5-b394-8401d0bcd821","block_type":"box","text":"focus on transmission and distribution, which is expected to be the least competitive and the more","page_number":187,"box":{"x":116,"y":800,"width":727,"height":12}},{"id":"b2cdea5c-f909-45d8-81be-eeaa18120083","block_type":"box","text":"regulated part of the business, may see higher ratings given the greater predictability of cash flow.","page_number":187,"box":{"x":117,"y":816,"width":726,"height":12}},{"id":"32c72325-5804-439f-a9e5-bbc129d27fe1","block_type":"box","text":"A number of states are considering or have","page_number":187,"box":{"x":116,"y":847,"width":319,"height":12}},{"id":"66735cf6-a470-4fdf-a6d6-425e69861b2d","block_type":"box","text":"enacted deregulation proposals. The introduction of","page_number":187,"box":{"x":436,"y":847,"width":379,"height":12}},{"id":"40639630-d153-426b-84e7-ea7241ba1484","block_type":"box","text":"competition into the industry as a result of such","page_number":187,"box":{"x":116,"y":862,"width":342,"height":12}},{"id":"3151c7d3-a8bd-4b6a-bd89-9c5cea9831aa","block_type":"box","text":"deregulation has at times resulted in lower revenue,","page_number":187,"box":{"x":458,"y":862,"width":386,"height":12}},{"id":"5f3efc60-924a-4f21-b799-1cae60c4fc06","block_type":"box","text":"lower credit ratings, increased default risk, and lower","page_number":187,"box":{"x":117,"y":878,"width":386,"height":12}},{"id":"1421815f-3af3-4cc2-a490-cd0e060c275a","block_type":"box","text":"electric utility security prices. Such increased","page_number":187,"box":{"x":504,"y":878,"width":330,"height":12}},{"id":"d3166916-626c-4813-a88e-a674ac312bde","block_type":"box","text":"II-100","page_number":187,"box":{"x":479,"y":909,"width":41,"height":9}},{"id":"ef113c22-4ff6-430b-b66d-c3cced4ed97f","block_type":"box","text":"NM1026U-6004382-187/605","page_number":187,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3c933d1d-91eb-416b-924e-4557d8e3c2b0","block_type":"box","text":"competition may also cause long-term contracts, whic","page_number":188,"box":{"x":116,"y":87,"width":391,"height":12}},{"id":"edd5ba6e-e2e3-480c-9560-2d69f1fcaa31","block_type":"box","text":"h electric utilities previously entered into to buy","page_number":188,"box":{"x":508,"y":87,"width":343,"height":12}},{"id":"af92f6e6-fe57-43ce-b969-504bf7d8f66e","block_type":"box","text":"power, to become “stranded assets” which have no economic value. Any loss associated with such","page_number":188,"box":{"x":117,"y":102,"width":723,"height":13}},{"id":"11edb0c8-af8f-479c-afb3-90e9c8a4e3f4","block_type":"box","text":"contracts must be absorbed by ratepayers and investors.","page_number":188,"box":{"x":116,"y":118,"width":413,"height":12}},{"id":"5a4a948a-b11e-4b35-8211-bbac528fa2b3","block_type":"box","text":"In addition, some electric utilities have acquired","page_number":188,"box":{"x":530,"y":118,"width":354,"height":12}},{"id":"b128339b-9398-4f01-a682-37116b58c8f4","block_type":"box","text":"electric utilities overseas to diversify, enhance ear","page_number":188,"box":{"x":116,"y":134,"width":362,"height":12}},{"id":"bd4f9d64-d402-41cb-b50f-adc6ca7a935e","block_type":"box","text":"nings and gain experience in operating in a deregulated","page_number":188,"box":{"x":478,"y":134,"width":409,"height":12}},{"id":"6c919b8e-dfae-4073-8065-b657f20d76d1","block_type":"box","text":"environment. In some instances, such acquisitions","page_number":188,"box":{"x":116,"y":149,"width":366,"height":12}},{"id":"945ea921-0790-4134-8d46-e3dfb310bb94","block_type":"box","text":"have involved significant borrowings, which have","page_number":188,"box":{"x":483,"y":149,"width":364,"height":12}},{"id":"b5d77d53-38b3-46a3-937a-aaf151be9020","block_type":"box","text":"burdened the acquirer’s balance sheet. There is no assu","page_number":188,"box":{"x":117,"y":165,"width":408,"height":11}},{"id":"0f4fb5a8-63b5-4f0e-abd7-1516ec690dc0","block_type":"box","text":"rance that current deregulation proposals will be","page_number":188,"box":{"x":528,"y":165,"width":353,"height":12}},{"id":"c6c80a9e-962d-4234-af1b-5d5954eaf232","block_type":"box","text":"adopted. However, deregulation in any form could signi","page_number":188,"box":{"x":116,"y":180,"width":400,"height":12}},{"id":"cd284a7c-9581-4bc6-9b11-7bfa6675ed52","block_type":"box","text":"ficantly impact the electric utilities industry.","page_number":188,"box":{"x":517,"y":180,"width":314,"height":12}},{"id":"2bef1543-4bef-44f6-86fc-2711de93aa10","block_type":"box","text":"Telecommunications.","page_number":188,"box":{"x":118,"y":211,"width":155,"height":10}},{"id":"fd89631d-5da3-4680-91f9-873c6a93f822","block_type":"box","text":"The telecommunications industry today includes both traditional telephone","page_number":188,"box":{"x":275,"y":211,"width":561,"height":12}},{"id":"5e49e1b7-fd15-469e-a962-fa956cc154f7","block_type":"box","text":"companies, with a history of broad market coverage and highly regulated businesses, and cable","page_number":188,"box":{"x":116,"y":227,"width":717,"height":12}},{"id":"b33abc5a-e5ee-4720-ae71-8439d0b6164a","block_type":"box","text":"companies, which began as small, lightly regulated businesses focused on limited markets. Today","page_number":188,"box":{"x":116,"y":242,"width":733,"height":12}},{"id":"0dfc1934-a670-4160-b766-ec044415bcf2","block_type":"box","text":"these two historically different businesses are converging in an industry that is trending toward larger,","page_number":188,"box":{"x":116,"y":258,"width":758,"height":12}},{"id":"35898b7f-9963-4c27-90bb-cf2ed41764a4","block_type":"box","text":"competitive national and international markets with an emphasis on deregulation. Companies that","page_number":188,"box":{"x":116,"y":273,"width":729,"height":12}},{"id":"db2a734c-ad38-4d50-97ab-f87999307bc2","block_type":"box","text":"distribute telephone services and provide access to the telephone networks still comprise the greatest","page_number":188,"box":{"x":116,"y":289,"width":760,"height":12}},{"id":"f8a86cbb-ba1e-4092-a63b-8aedec98fe6d","block_type":"box","text":"portion of this segment, but non-regulated activities such as wireless telephone services, paging, data","page_number":188,"box":{"x":117,"y":304,"width":759,"height":12}},{"id":"b41e4aaa-ef51-48cd-b6ce-bad30a2a9213","block_type":"box","text":"transmission and processing, equipment retailing, computer software and hardware and internet","page_number":188,"box":{"x":116,"y":320,"width":718,"height":12}},{"id":"3248f0dc-5e69-430d-b98b-a356254725ec","block_type":"box","text":"services are becoming increasingly significant components as well. In particular, wireless and internet","page_number":188,"box":{"x":116,"y":335,"width":759,"height":12}},{"id":"1c11f5ef-9cae-43b8-bdcf-38b87db0650a","block_type":"box","text":"telephone services continue to gain market share at the expense of traditional telephone companies.","page_number":188,"box":{"x":116,"y":351,"width":752,"height":12}},{"id":"1a6b09b0-1662-48ef-9433-4b2c5f966446","block_type":"box","text":"The presence of unregulated companies in this industry and the entry of traditional telephone","page_number":188,"box":{"x":116,"y":366,"width":696,"height":12}},{"id":"ab67fd8d-d528-4873-8aa9-c2f0d6c96255","block_type":"box","text":"companies into unregulated or less regulated businesses provide significant investment opportunities","page_number":188,"box":{"x":116,"y":382,"width":755,"height":12}},{"id":"abd8285d-6171-4121-a467-9080a4f613fd","block_type":"box","text":"with companies that may increase their earnings at faster rates than had been allowed in traditional","page_number":188,"box":{"x":116,"y":397,"width":742,"height":12}},{"id":"f7d9afd8-6745-4418-85b5-193ca6b28684","block_type":"box","text":"regulated businesses. Still, increasing competition, technological innovations and other structural","page_number":188,"box":{"x":117,"y":413,"width":722,"height":12}},{"id":"956c1650-7d05-4d3a-8a08-fbd714024cfb","block_type":"box","text":"changes could adversely affect the profitability of such utilities and the growth rate of their dividends.","page_number":188,"box":{"x":116,"y":428,"width":750,"height":12}},{"id":"dda69ac4-6fdf-4a80-bede-86fc799d1516","block_type":"box","text":"Given mergers and proposed legislation and enforcement changes, it is likely that both traditional","page_number":188,"box":{"x":117,"y":444,"width":725,"height":12}},{"id":"8207f741-2b2b-4e57-9e78-c2197a813a6c","block_type":"box","text":"telephone companies and cable companies will continue to provide an expanding range of utility","page_number":188,"box":{"x":116,"y":459,"width":718,"height":12}},{"id":"8fec68a1-8334-434e-8c08-5631a60a9431","block_type":"box","text":"services to both residential, corporate and governmental customers.","page_number":188,"box":{"x":116,"y":475,"width":511,"height":12}},{"id":"f62db3e6-385a-4ba0-8156-c8febf61df79","block_type":"box","text":"Gas.","page_number":188,"box":{"x":117,"y":506,"width":33,"height":9}},{"id":"2f2db912-bea1-429c-977d-34149977e7fb","block_type":"box","text":"Gas transmission companies and gas distribution companies are undergoing significant changes.","page_number":188,"box":{"x":151,"y":506,"width":733,"height":12}},{"id":"0bfaa80a-30cc-44cc-aafd-06b88347387a","block_type":"box","text":"In the United States, interstate transmission companies are regulated by the Federal Energy","page_number":188,"box":{"x":117,"y":521,"width":689,"height":12}},{"id":"4cc04805-0093-4367-9ccf-873575fdbaf6","block_type":"box","text":"Regulatory Commission, which is reducing its regulation of the industry. Many companies have","page_number":188,"box":{"x":117,"y":537,"width":709,"height":12}},{"id":"6ecafbc9-efa7-4eb2-81af-d4714c471746","block_type":"box","text":"diversified into oil and gas exploration and development, making returns more sensitive to energy","page_number":188,"box":{"x":116,"y":552,"width":728,"height":12}},{"id":"aa7eb97c-6621-4d16-bfdc-0ddd50dbf7fb","block_type":"box","text":"prices. In the recent decade, gas utility companies have been adversely affected by disruptions in the","page_number":188,"box":{"x":117,"y":568,"width":756,"height":12}},{"id":"83e78d59-9850-4338-8676-7bc915cd474c","block_type":"box","text":"oil industry and have also been affected by increased concentration and competition. In the opinion of","page_number":188,"box":{"x":116,"y":583,"width":759,"height":12}},{"id":"c4ee0a75-a840-402d-8d00-82594d19d491","block_type":"box","text":"the Manager, however, environmental considerations could improve the gas industry outlook in the","page_number":188,"box":{"x":116,"y":599,"width":738,"height":12}},{"id":"fdc70aa3-4bc6-40ae-8eeb-522f449440e3","block_type":"box","text":"future. For example, natural gas is the cleanest of the hydrocarbon fuels, and this may result in","page_number":188,"box":{"x":116,"y":614,"width":709,"height":12}},{"id":"e4745301-490b-46c1-b693-fd5996502762","block_type":"box","text":"incremental shifts in fuel consumption toward natural gas and away from oil and coal, even for","page_number":188,"box":{"x":117,"y":630,"width":702,"height":12}},{"id":"2e5e927f-55f2-4da7-a221-380da589ffb2","block_type":"box","text":"electricity generation. However, technological or regulatory changes within the industry may delay or","page_number":188,"box":{"x":116,"y":645,"width":750,"height":12}},{"id":"938b2c93-4120-43cd-94d2-3ce883336fdc","block_type":"box","text":"prevent this result.","page_number":188,"box":{"x":117,"y":661,"width":135,"height":12}},{"id":"d2854a08-7d38-46de-abd6-06508ea1eed0","block_type":"box","text":"Water.","page_number":188,"box":{"x":118,"y":692,"width":46,"height":9}},{"id":"76d6ef8f-3f3b-4007-a551-a1d79cb8b494","block_type":"box","text":"Water supply utilities are companies that collect, purify, distribute and sell water. In the United","page_number":188,"box":{"x":170,"y":692,"width":695,"height":12}},{"id":"79c2f920-0161-4573-9398-b1afd7b5b0f7","block_type":"box","text":"States and around the world the industry is highly fragmented because most of the supplies are owned","page_number":188,"box":{"x":116,"y":707,"width":762,"height":12}},{"id":"ca583566-7fcc-42ce-bd97-fe6f852cea2b","block_type":"box","text":"by local authorities. Companies in this industry are generally mature and are experiencing little or no","page_number":188,"box":{"x":117,"y":723,"width":743,"height":12}},{"id":"bee68376-1159-49e2-a6ff-cc5da46934ce","block_type":"box","text":"per capita volume growth. In the opinion of the Manager, there may be opportunities for certain","page_number":188,"box":{"x":117,"y":738,"width":702,"height":12}},{"id":"13cf3416-2493-4693-a3f4-dfcdbafb7578","block_type":"box","text":"companies to acquire other water utility companies and for foreign acquisition of domestic companies.","page_number":188,"box":{"x":116,"y":754,"width":755,"height":12}},{"id":"8e11212d-2170-47aa-9894-57c978274517","block_type":"box","text":"The Manager believes that favorable investment opportunities may result from consolidation of this","page_number":188,"box":{"x":116,"y":769,"width":733,"height":12}},{"id":"dd35f2a3-8915-425e-9a83-eac99a06aa99","block_type":"box","text":"segment. As with other utilities, however, increased regulation, increased costs and potential","page_number":188,"box":{"x":116,"y":785,"width":687,"height":12}},{"id":"af30e9e0-7351-463e-b04f-fc87bc5c1c26","block_type":"box","text":"disruptions in supply may adversely affect investments in water supply utilities.","page_number":188,"box":{"x":116,"y":800,"width":582,"height":12}},{"id":"57dc911d-ee31-4d1b-8308-e574bac34d5c","block_type":"box","text":"Utility Industries Generally.","page_number":188,"box":{"x":117,"y":831,"width":197,"height":12}},{"id":"df7934e1-76d9-4a51-91a6-8658853f30cb","block_type":"box","text":"There can be no assurance that the positive developments noted above,","page_number":188,"box":{"x":316,"y":831,"width":548,"height":12}},{"id":"13e1efb9-0e82-4fcb-82ca-397a753162e4","block_type":"box","text":"including those relating to privatization and changing regulation, will occur or that risk factors other than","page_number":188,"box":{"x":117,"y":847,"width":771,"height":12}},{"id":"ed48eecc-bd08-4156-864d-5ac3ca3342f5","block_type":"box","text":"those noted above will not develop in the future.","page_number":188,"box":{"x":116,"y":862,"width":361,"height":12}},{"id":"4e768fc7-6675-4d2c-a943-3c62db2f217f","block_type":"box","text":"II-101","page_number":188,"box":{"x":480,"y":909,"width":38,"height":9}},{"id":"e57defc1-82d2-4df8-b3b5-0652686abc2a","block_type":"box","text":"NM1026U-6004382-188/605","page_number":188,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c6cbf838-cd3c-4113-ad66-92110f1fa07b","block_type":"box","text":"When-Issued Securities, Delayed Delivery Securities and Forward Commitments.","page_number":189,"box":{"x":118,"y":87,"width":643,"height":12}},{"id":"e82c82de-579c-40a3-bca5-31444fdb43fe","block_type":"box","text":"A Fund may","page_number":189,"box":{"x":762,"y":87,"width":100,"height":12}},{"id":"4e3f1980-3416-4441-91da-25a44ec4790e","block_type":"box","text":"purchase or sell securities that it is entitled to receive on a when-issued basis. A Fund may also","page_number":189,"box":{"x":117,"y":103,"width":713,"height":12}},{"id":"d53ef807-3328-4f9d-8942-f10dc638b23f","block_type":"box","text":"purchase or sell securities on a delayed delivery basis or through a forward commitment (including on","page_number":189,"box":{"x":117,"y":118,"width":758,"height":12}},{"id":"dac1f121-b4a3-4c83-a1c1-794ec267ceeb","block_type":"box","text":"a TBA (to be announced) basis). These transactions involve the purchase or sale of securities by a","page_number":189,"box":{"x":116,"y":134,"width":739,"height":12}},{"id":"0346ce00-8fd9-41c2-a7a1-bd4c1e420c5e","block_type":"box","text":"Fund at an established price with payment and delivery taking place in the future. The Fund enters into","page_number":189,"box":{"x":117,"y":149,"width":767,"height":12}},{"id":"7c8b4588-5751-449a-b889-111502c41297","block_type":"box","text":"these transactions to obtain what is considered an advantageous price to the Fund at the time of","page_number":189,"box":{"x":116,"y":165,"width":721,"height":12}},{"id":"a9ebb391-7aa6-4eb9-9cd4-859ff10a9e7e","block_type":"box","text":"entering into the transaction.","page_number":189,"box":{"x":116,"y":180,"width":217,"height":12}},{"id":"f21837bb-d220-4ff9-95b9-1c6df2a93744","block_type":"box","text":"Pursuant to recommendations of the Treasury Market Practices Group, which is sponsored by the","page_number":189,"box":{"x":117,"y":211,"width":731,"height":12}},{"id":"b6c956e0-238f-46d7-86bd-0a4f178c6dc8","block_type":"box","text":"Federal Reserve Bank of New York, a Fund or its counterparty generally will be required to post","page_number":189,"box":{"x":117,"y":227,"width":714,"height":12}},{"id":"7915fa2c-1c0b-4acc-9ab3-7e4d2f1b4c2f","block_type":"box","text":"collateral when entering into certain forward-settling transactions, including without limitation TBA","page_number":189,"box":{"x":116,"y":242,"width":726,"height":12}},{"id":"0429c118-e3f1-4758-b8c8-8c3391dde02c","block_type":"box","text":"transactions. FINRA rules have also been implemented that include mandatory margin requirements","page_number":189,"box":{"x":116,"y":258,"width":750,"height":12}},{"id":"7a11ac59-e6a7-43bb-bbf1-ac7350b2e671","block_type":"box","text":"for the TBA market with limited exceptions. The collateralization of TBA trades is intended to mitigate","page_number":189,"box":{"x":116,"y":273,"width":754,"height":12}},{"id":"00cf45c1-a3ee-446c-8d78-8128b8940674","block_type":"box","text":"counterparty credit risk between trade and settlement, but could increase the cost of TBA transactions","page_number":189,"box":{"x":116,"y":289,"width":763,"height":12}},{"id":"c63f75aa-4e52-43b8-82e9-09b737ea2556","block_type":"box","text":"and impose added operational complexity.","page_number":189,"box":{"x":116,"y":304,"width":320,"height":12}},{"id":"92417c95-0fa6-4d18-87ac-cb7fcb74f963","block_type":"box","text":"There can be no assurance that a security purchased on a when-issued basis will be issued or that a","page_number":189,"box":{"x":116,"y":335,"width":754,"height":12}},{"id":"4bc0c9ee-e46b-4a9b-945e-1163632930fe","block_type":"box","text":"security purchased or sold on a delayed delivery basis or through a forward commitment will be","page_number":189,"box":{"x":116,"y":351,"width":713,"height":12}},{"id":"0569a0e7-8915-4cce-a97c-28c1096b2180","block_type":"box","text":"delivered. Also, the value of securities in these transactions on the delivery date may be more or less","page_number":189,"box":{"x":116,"y":366,"width":755,"height":12}},{"id":"a19bf2af-837b-4087-94f5-08dfa7fb00c2","block_type":"box","text":"than the price paid by the Fund to purchase the securities. The Fund will lose money if the value of the","page_number":189,"box":{"x":116,"y":382,"width":766,"height":12}},{"id":"cfb09504-627b-424f-8656-1d43387ae8b4","block_type":"box","text":"security in such a transaction declines below the purchase price and will not benefit if the value of the","page_number":189,"box":{"x":116,"y":397,"width":757,"height":12}},{"id":"c6bba740-0a9b-4a76-b4ea-211af453afdb","block_type":"box","text":"security appreciates above the sale price during the commitment period.","page_number":189,"box":{"x":116,"y":413,"width":542,"height":12}},{"id":"097f21da-2cd1-4263-8aa6-5f445b62bd3b","block_type":"box","text":"If deemed advisable as a matter of investment strategy, a Fund may dispose of or renegotiate a","page_number":189,"box":{"x":117,"y":444,"width":715,"height":12}},{"id":"4f0bad80-fa1a-462d-a39d-11b3ab456cd4","block_type":"box","text":"commitment after it has been entered into, and may sell securities it has committed to purchase before","page_number":189,"box":{"x":116,"y":459,"width":767,"height":12}},{"id":"9046e182-7da1-4447-9b40-57d56faaa0b3","block_type":"box","text":"those securities are delivered to the Fund on the settlement date. In these cases the Fund may realize","page_number":189,"box":{"x":116,"y":475,"width":764,"height":12}},{"id":"bbbebff2-76c3-44a1-85fc-fd943cdb633e","block_type":"box","text":"a taxable capital gain or loss.","page_number":189,"box":{"x":116,"y":490,"width":221,"height":12}},{"id":"b2c19a53-3f4f-4e07-8ee1-9dbf28c0478b","block_type":"box","text":"When a Fund engages in when-issued, TBA or forward commitment transactions, it relies on the other","page_number":189,"box":{"x":116,"y":521,"width":763,"height":12}},{"id":"fd69b3dd-559b-4c74-87e1-8a6847c1ba9d","block_type":"box","text":"party to consummate the trade. Failure of such party to do so may result in the Fund’s incurring a loss","page_number":189,"box":{"x":117,"y":537,"width":760,"height":12}},{"id":"b6c5129f-1065-4b48-b570-92df87bcd6f1","block_type":"box","text":"or missing an opportunity to obtain a price considered to be advantageous.","page_number":189,"box":{"x":116,"y":552,"width":561,"height":12}},{"id":"70e7b121-890f-458b-a44e-6c1e830dc988","block_type":"box","text":"The market value of the securities underlying a commitment to purchase securities, and any","page_number":189,"box":{"x":116,"y":583,"width":688,"height":12}},{"id":"9982f6ad-d373-4768-912f-8eeb7cceb45c","block_type":"box","text":"subsequent fluctuations in their market value, is taken into account when determining the market value","page_number":189,"box":{"x":116,"y":599,"width":767,"height":12}},{"id":"d67f2a31-47e2-4f5b-98e1-5a68ac4c2788","block_type":"box","text":"of a Fund starting on the day the Fund agrees to purchase the securities. The Fund does not earn","page_number":189,"box":{"x":116,"y":614,"width":732,"height":12}},{"id":"deb5415b-47a9-4f6c-b988-0bed03850396","block_type":"box","text":"interest on the securities it has committed to purchase until they are paid for and delivered on the","page_number":189,"box":{"x":117,"y":630,"width":725,"height":12}},{"id":"b2188dc6-8f47-4bd5-9a34-82b0058f8f2e","block_type":"box","text":"settlement date.","page_number":189,"box":{"x":116,"y":645,"width":124,"height":10}},{"id":"9372d57d-c502-4ba8-8265-6cd19f83cddb","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into when-issued or forward","page_number":189,"box":{"x":117,"y":676,"width":740,"height":12}},{"id":"10e979e8-8bf5-4bc6-a029-0c1563e95bb7","block_type":"box","text":"settling securities (e.g., firm and standby commitments, including TBA commitments, and dollar rolls)","page_number":189,"box":{"x":116,"y":692,"width":747,"height":12}},{"id":"d74ee543-9c4a-42ec-8a61-91857e0a25f6","block_type":"box","text":"and non-standard settlement cycle securities notwithstanding the limitation on the issuance of senior","page_number":189,"box":{"x":116,"y":707,"width":746,"height":12}},{"id":"df6f8ca6-d6f6-4c16-9b07-7c1d116c0e20","block_type":"box","text":"securities in Section 18 of the Investment Company Act, provided that the Fund intends to physically","page_number":189,"box":{"x":116,"y":723,"width":745,"height":12}},{"id":"b329cfb7-a195-4e8b-a2d7-c11ecd1d9888","block_type":"box","text":"settle the transaction and the transaction will settle within 35 days of its trade date (the “Delayed","page_number":189,"box":{"x":116,"y":738,"width":719,"height":12}},{"id":"386b88ab-96d2-46a7-9904-ed5f8e35f473","block_type":"box","text":"Settlement Securities Provision”). If a when-issued, forward-settling or non-standard settlement cycle","page_number":189,"box":{"x":116,"y":754,"width":749,"height":12}},{"id":"2866478e-5289-4ae0-b690-cba48b5fad20","block_type":"box","text":"security does not satisfy the Delayed-Settlement Securities Provision, then it is treated as a Derivatives","page_number":189,"box":{"x":116,"y":769,"width":765,"height":12}},{"id":"1d05c3de-f12c-44fe-a25c-761fa0ebebd4","block_type":"box","text":"Transaction under Rule 18f-4. See “—Derivatives—Regulation of Derivatives—Rule 18f-4 under the","page_number":189,"box":{"x":116,"y":785,"width":741,"height":12}},{"id":"11072b65-ddd7-4761-91f3-a603615786eb","block_type":"box","text":"Investment Company Act” above.","page_number":189,"box":{"x":117,"y":800,"width":246,"height":12}},{"id":"b22286f5-7508-464f-8b46-8d44a2504015","block_type":"box","text":"Regulations adopted by global prudential regulators require certain bank-regulated counterparties and","page_number":189,"box":{"x":117,"y":831,"width":761,"height":12}},{"id":"a17e6666-d0de-4b4b-88eb-f2e7e6e788f6","block_type":"box","text":"certain of their affiliates to include in certain financial contracts, including many agreements with","page_number":189,"box":{"x":116,"y":847,"width":716,"height":12}},{"id":"d39ee19a-30cc-4ddb-aae7-21bad1951c3a","block_type":"box","text":"respect to when-issued, TBA and forward commitment transactions, terms that delay or restrict the","page_number":189,"box":{"x":117,"y":862,"width":736,"height":12}},{"id":"59b642f4-da46-4743-b6d4-2b522642d773","block_type":"box","text":"rights of counterparties, such as a Fund, to terminate such agreements, foreclose upon collateral,","page_number":189,"box":{"x":117,"y":878,"width":728,"height":12}},{"id":"abefa30a-a755-497d-8714-5116e765c207","block_type":"box","text":"II-102","page_number":189,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"0289f89f-dc0e-43d9-a79f-197ad3effb1c","block_type":"box","text":"NM1026U-6004382-189/605","page_number":189,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6268b328-87a7-496a-b6e0-14da2507a44d","block_type":"box","text":"exercise other default rights or restrict transfers of credit support in the event that the counterparty and/","page_number":190,"box":{"x":116,"y":87,"width":766,"height":12}},{"id":"459df2e3-d33d-4d4e-9f39-85d5fa91e416","block_type":"box","text":"or its affiliates are subject to certain types of resolution or insolvency proceedings. It is possible that","page_number":190,"box":{"x":116,"y":102,"width":744,"height":13}},{"id":"465926df-c26b-44a4-acde-77dd10a9d491","block_type":"box","text":"these requirements, as well as potential additional government regulation and other developments in","page_number":190,"box":{"x":116,"y":118,"width":752,"height":12}},{"id":"8cf4abaf-4843-4052-aa4b-dc7c819012e5","block_type":"box","text":"the market, could adversely affect a Fund’s ability to terminate existing agreements with respect to","page_number":190,"box":{"x":116,"y":134,"width":735,"height":12}},{"id":"30f9e448-a03e-4c89-9a54-a35365325531","block_type":"box","text":"these transactions or to realize amounts to be received under such agreements.","page_number":190,"box":{"x":116,"y":149,"width":600,"height":12}},{"id":"a582b353-58ee-4850-8cc7-5e0373063ab6","block_type":"box","text":"Yields and Ratings.","page_number":190,"box":{"x":118,"y":180,"width":152,"height":12}},{"id":"7968c3a6-281f-4974-8e0f-bd601b6d51ce","block_type":"box","text":"The yields on certain obligations are dependent on a variety of factors, including","page_number":190,"box":{"x":271,"y":180,"width":604,"height":12}},{"id":"65e5055d-133c-4b4c-b6e1-9b557b41b059","block_type":"box","text":"general market conditions, conditions in the particular market for the obligation, the financial condition","page_number":190,"box":{"x":116,"y":196,"width":759,"height":12}},{"id":"37438b99-58d1-4f7c-b87f-79eeedd6e117","block_type":"box","text":"of the issuer, the size of the offering, the maturity of the obligation and the ratings of the issue. The","page_number":190,"box":{"x":116,"y":211,"width":738,"height":12}},{"id":"c39a0e1b-a523-44a9-994e-720384d7795d","block_type":"box","text":"ratings of Moody’s, Fitch and S&P represent their respective opinions as to the quality of the","page_number":190,"box":{"x":117,"y":227,"width":688,"height":12}},{"id":"8b1c05ff-b0b1-4482-9afc-51728ed0a12c","block_type":"box","text":"obligations they undertake to rate. Ratings, however, are general and are not absolute standards of","page_number":190,"box":{"x":116,"y":242,"width":743,"height":12}},{"id":"b644aa31-60ee-455c-99c0-005d2962972b","block_type":"box","text":"quality. Consequently, obligations with the same rating, maturity and interest rate may have different","page_number":190,"box":{"x":116,"y":258,"width":749,"height":12}},{"id":"dd67803e-3071-413f-9cec-9f6776530416","block_type":"box","text":"market prices. Subsequent to its purchase by a Fund, a rated security may cease to be rated. A Fund’s","page_number":190,"box":{"x":117,"y":273,"width":769,"height":12}},{"id":"62c33a55-f44b-4ef0-b738-d2b99f9cd9e4","block_type":"box","text":"Manager or sub-adviser will consider such an event in determining whether the Fund should continue","page_number":190,"box":{"x":117,"y":289,"width":755,"height":12}},{"id":"29068f55-eb49-4c7a-a9cc-dc5503dc40e5","block_type":"box","text":"to hold the security.","page_number":190,"box":{"x":116,"y":304,"width":150,"height":12}},{"id":"5ba07cd6-8127-4cc3-af42-e3dec47f3b66","block_type":"box","text":"Zero Coupon Securities.","page_number":190,"box":{"x":116,"y":335,"width":193,"height":12}},{"id":"9e8457e2-0054-49af-b033-41f750fe8ca6","block_type":"box","text":"Zero coupon securities are securities that are sold at a discount to par value","page_number":190,"box":{"x":310,"y":335,"width":575,"height":12}},{"id":"d179ebf1-f180-49d5-b271-4b0128e44624","block_type":"box","text":"and do not pay interest during the life of the security. The discount approximates the total amount of","page_number":190,"box":{"x":116,"y":351,"width":747,"height":12}},{"id":"49b0a822-0c04-4baa-84a8-d18f087ba229","block_type":"box","text":"interest the security will accrue and compound over the period until maturity at a rate of interest","page_number":190,"box":{"x":117,"y":366,"width":711,"height":12}},{"id":"777684ef-dd56-4af4-b7f3-980e51e31d7c","block_type":"box","text":"reflecting the market rate of the security at the time of issuance. Upon maturity, the holder of a zero","page_number":190,"box":{"x":117,"y":382,"width":741,"height":12}},{"id":"98aa8a7e-5930-415a-bf8f-8fa025b794df","block_type":"box","text":"coupon security is entitled to receive the par value of the security.","page_number":190,"box":{"x":116,"y":397,"width":492,"height":12}},{"id":"841a2576-0bea-4c8b-aac2-9ec88c8a966f","block_type":"box","text":"While interest payments are not made on such securities, holders of such securities are deemed to","page_number":190,"box":{"x":116,"y":428,"width":740,"height":12}},{"id":"5590509d-8ef4-4eb1-92f2-782fd97c6a4c","block_type":"box","text":"have received income (“phantom income”) annually, notwithstanding that cash may not be received","page_number":190,"box":{"x":117,"y":444,"width":742,"height":12}},{"id":"2e2c6cd5-47a6-4128-ac68-264a05bfe5f4","block_type":"box","text":"currently. The effect of owning instruments that do not make current interest payments is that a fixed","page_number":190,"box":{"x":116,"y":459,"width":751,"height":12}},{"id":"91c43e2e-6df6-46aa-9ef1-497e7c148834","block_type":"box","text":"yield is earned not only on the original investment but also, in effect, on all discount accretion during","page_number":190,"box":{"x":116,"y":475,"width":746,"height":12}},{"id":"75dc6154-529c-49f7-81cc-75bb29ee6e86","block_type":"box","text":"the life of the obligations. This implicit reinvestment of earnings at a fixed rate eliminates the risk of","page_number":190,"box":{"x":116,"y":490,"width":737,"height":12}},{"id":"5c695329-4303-443b-b4bf-66ada276b0b3","block_type":"box","text":"being unable to invest distributions at a rate as high as the implicit yield on the zero coupon bond, but","page_number":190,"box":{"x":117,"y":506,"width":757,"height":12}},{"id":"b790ad4c-e81b-49fa-961b-9b19981e7d66","block_type":"box","text":"at the same time eliminates the holder’s ability to reinvest at higher rates in the future. For this reason,","page_number":190,"box":{"x":116,"y":521,"width":764,"height":12}},{"id":"0fbac586-f3dd-4bf9-9bf5-cf3ca5e535e8","block_type":"box","text":"some of these securities may be subject to substantially greater price fluctuations during periods of","page_number":190,"box":{"x":116,"y":537,"width":739,"height":12}},{"id":"c63ffcb6-86fb-4ad0-b5b2-4aaec9bac16e","block_type":"box","text":"changing market interest rates than are comparable securities that pay interest currently. Longer term","page_number":190,"box":{"x":116,"y":552,"width":760,"height":12}},{"id":"cc4bea8f-4122-4e9e-93d7-4d89e54058d4","block_type":"box","text":"zero coupon bonds are more exposed to interest rate risk than shorter term zero coupon bonds. These","page_number":190,"box":{"x":116,"y":568,"width":768,"height":12}},{"id":"c9a08f93-6c87-4a04-95c6-e0e38c20d73b","block_type":"box","text":"investments benefit the issuer by mitigating its need for cash to meet debt service, but also require a","page_number":190,"box":{"x":117,"y":583,"width":749,"height":12}},{"id":"9bf823ff-7821-40bf-ba84-6d7fa06328bb","block_type":"box","text":"higher rate of return to attract investors who are willing to defer receipt of cash.","page_number":190,"box":{"x":117,"y":599,"width":589,"height":12}},{"id":"a367dca0-6a85-41a9-a1a6-39c78349b962","block_type":"box","text":"A Fund accrues income with respect to these securities for U.S. federal income tax and accounting","page_number":190,"box":{"x":116,"y":630,"width":739,"height":12}},{"id":"3a6a8a28-aa90-44e1-9ac6-c469de06b112","block_type":"box","text":"purposes prior to the receipt of cash payments. Zero coupon securities may be subject to greater","page_number":190,"box":{"x":117,"y":645,"width":724,"height":12}},{"id":"24240e98-c27a-40c3-921e-1adcca0ad33c","block_type":"box","text":"fluctuation in value and less liquidity in the event of adverse market conditions than comparably rated","page_number":190,"box":{"x":116,"y":661,"width":750,"height":12}},{"id":"f74366bc-46c8-4863-ae78-140ada85321a","block_type":"box","text":"securities that pay cash interest at regular intervals.","page_number":190,"box":{"x":116,"y":676,"width":382,"height":12}},{"id":"76199559-1a5c-4c70-bbf5-612a2ba959d1","block_type":"box","text":"Further, to maintain its qualification for pass-through treatment under the U.S. federal tax laws, a Fund","page_number":190,"box":{"x":117,"y":707,"width":759,"height":12}},{"id":"a7c02113-4c0c-4004-b73b-1d2f07c6eb80","block_type":"box","text":"is required to distribute income to its shareholders and, consequently, may have to dispose of other,","page_number":190,"box":{"x":117,"y":723,"width":740,"height":12}},{"id":"b98bed7e-5bad-4d68-8635-26108f198411","block_type":"box","text":"more liquid portfolio securities under disadvantageous circumstances or may have to leverage itself by","page_number":190,"box":{"x":117,"y":738,"width":760,"height":12}},{"id":"0393e5ca-9879-4355-962d-2ff43ac15db5","block_type":"box","text":"borrowing in order to generate the cash to satisfy these distributions. The required distributions may","page_number":190,"box":{"x":117,"y":754,"width":740,"height":12}},{"id":"bd1e4d38-a5dd-458c-9055-79f50e9ead54","block_type":"box","text":"result in an increase in a Fund’s exposure to zero coupon securities.","page_number":190,"box":{"x":117,"y":769,"width":505,"height":12}},{"id":"8a9908a7-8bc9-47d2-87e4-1da9e16a29cd","block_type":"box","text":"In addition to the above-described risks, there are certain other risks related to investing in zero","page_number":190,"box":{"x":117,"y":800,"width":707,"height":12}},{"id":"4aabaddf-b583-4f95-a898-4e8537a62054","block_type":"box","text":"coupon securities. During a period of severe market conditions, the market for such securities may","page_number":190,"box":{"x":116,"y":816,"width":731,"height":12}},{"id":"ddf185f7-bfad-4ae8-9cd8-8b417d87a2ec","block_type":"box","text":"become even less liquid. In addition, as these securities do not pay cash interest, a Fund’s investment","page_number":190,"box":{"x":117,"y":831,"width":762,"height":12}},{"id":"d316e6b0-ec3a-4923-8f31-fc84b9031628","block_type":"box","text":"exposure to these securities and their risks, including credit risk, will increase during the time these","page_number":190,"box":{"x":116,"y":847,"width":739,"height":12}},{"id":"668f85ea-b314-4b13-94f5-6e4d2df53aa6","block_type":"box","text":"securities are held in the Fund’s portfolio.","page_number":190,"box":{"x":116,"y":862,"width":311,"height":12}},{"id":"ef57027a-6515-4791-96e8-ff04a1013b84","block_type":"box","text":"II-103","page_number":190,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"711e7dc0-8506-4ead-8075-3f31086f5553","block_type":"box","text":"NM1026U-6004382-190/605","page_number":190,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3bb683d0-b9b5-4e1b-bb9e-dc606e1ea050","block_type":"box","text":"Suitability. (All Funds)","page_number":191,"box":{"x":117,"y":87,"width":181,"height":12}},{"id":"d947e54c-75a6-4b83-a26c-69fce5b91d86","block_type":"box","text":"The economic benefit of an investment in any Fund depends upon many factors beyond the control of","page_number":191,"box":{"x":116,"y":111,"width":760,"height":12}},{"id":"b0aed194-22aa-4f83-ab52-55579c437886","block_type":"box","text":"the Fund, the Manager and its affiliates. Each Fund should be considered a vehicle for diversification","page_number":191,"box":{"x":116,"y":126,"width":753,"height":12}},{"id":"e51a2f6a-27fe-400a-9eb1-86d23caf0604","block_type":"box","text":"and not as a balanced investment program. The suitability for any particular investor of a purchase of","page_number":191,"box":{"x":116,"y":142,"width":755,"height":12}},{"id":"e2e8c76b-20de-437e-8f02-585752fe284e","block_type":"box","text":"shares in a Fund will depend upon, among other things, such investor’s investment objectives and","page_number":191,"box":{"x":116,"y":157,"width":733,"height":12}},{"id":"a16d4f0e-04ef-4ca9-b77e-4177d489ef1c","block_type":"box","text":"such investor’s ability to accept the risks associated with investing in securities, including the risk of","page_number":191,"box":{"x":116,"y":173,"width":741,"height":12}},{"id":"73c588ca-90f2-4dec-aede-bbaf4807608b","block_type":"box","text":"loss of principal.","page_number":191,"box":{"x":117,"y":188,"width":124,"height":12}},{"id":"354e1634-00da-4cc4-b7e4-f640dd5360e9","block_type":"box","text":"Investment Restrictions. (All Funds)","page_number":191,"box":{"x":116,"y":220,"width":293,"height":12}},{"id":"cc661a5d-5c45-42be-8a96-6e1403f9ce82","block_type":"box","text":"See “Investment Restrictions” or “Investment Policies,” as applicable in each Fund’s SAI for the","page_number":191,"box":{"x":116,"y":244,"width":712,"height":12}},{"id":"80c5bd7e-17e9-4589-8c38-a3d6ab58a83b","block_type":"box","text":"specific fundamental and non-fundamental investment restrictions adopted by each Fund. In addition to","page_number":191,"box":{"x":116,"y":259,"width":772,"height":13}},{"id":"b3f4a099-ce31-4bc5-914f-6cbfa3e40134","block_type":"box","text":"those investment restrictions, each Fund is also subject to the restrictions discussed below.","page_number":191,"box":{"x":116,"y":275,"width":683,"height":12}},{"id":"5f0091ce-61e2-4a77-a51b-bd213b9fcf93","block_type":"box","text":"Each Fund’s investments will be limited in order to","page_number":191,"box":{"x":117,"y":307,"width":376,"height":9}},{"id":"bcf149a5-4c21-4772-a70e-ad4e9478d83e","block_type":"box","text":"allow the Fund to qualify as a “regulated investment","page_number":191,"box":{"x":494,"y":307,"width":389,"height":12}},{"id":"aa62aa65-9e1d-4f1b-835b-3e407917df95","block_type":"box","text":"company” for purposes of the Code. See “Dividends and Taxes — Taxes” or “Taxes.” To qualify,","page_number":191,"box":{"x":116,"y":322,"width":721,"height":13}},{"id":"e211cb6e-714b-4ad7-b710-dee106d3a35d","block_type":"box","text":"among other requirements, each Fund will limit its investments so that, at the close of each quarter of","page_number":191,"box":{"x":116,"y":338,"width":757,"height":12}},{"id":"e5fe05b9-4981-48ed-817d-f6bb1ad9287f","block_type":"box","text":"the taxable year, (i) at least 50% of the market value of each Fund’s assets is represented by cash,","page_number":191,"box":{"x":116,"y":353,"width":741,"height":13}},{"id":"854403ff-8232-45c2-9f2c-a3bef4472706","block_type":"box","text":"securities of other regulated investment companies, U.S. Government Securities and other securities,","page_number":191,"box":{"x":116,"y":369,"width":759,"height":12}},{"id":"22087693-ac73-420f-a22c-ac3e9cd0bc29","block_type":"box","text":"with such other securities limited, in respect of any one issuer, to an amount not greater in value than","page_number":191,"box":{"x":116,"y":384,"width":756,"height":13}},{"id":"705501f7-7a34-4bcb-959b-67f583a0c130","block_type":"box","text":"5% of the Fund’s assets and not greater than 10% of the outstanding voting securities of such issuer","page_number":191,"box":{"x":116,"y":400,"width":751,"height":12}},{"id":"a9c1422c-5478-49ae-b774-8213d5c769e8","block_type":"box","text":"and (ii) not more than 25% of the value of its assets is invested in the securities (other than U.S.","page_number":191,"box":{"x":116,"y":415,"width":718,"height":13}},{"id":"e3b046d4-e16b-4853-9442-70017272fd49","block_type":"box","text":"Government Securities or securities of other regulated investment companies) of any one issuer, any","page_number":191,"box":{"x":117,"y":431,"width":754,"height":12}},{"id":"57db45bf-4058-4bac-9ccd-728522ea7296","block_type":"box","text":"two or more issuers that the Fund controls and that are determined to be engaged in the same or","page_number":191,"box":{"x":116,"y":447,"width":726,"height":12}},{"id":"2701300f-a366-4e2f-b573-c27cb5147445","block_type":"box","text":"similar trades or businesses or related trades or businesses or in the securities of one or more qualified","page_number":191,"box":{"x":116,"y":462,"width":772,"height":12}},{"id":"35b975c4-466d-4378-af2b-48375c21e383","block_type":"box","text":"publicly traded partnerships (","page_number":191,"box":{"x":117,"y":477,"width":214,"height":13}},{"id":"48ee1b64-07bd-4d6d-b9ff-ac1f0669cc06","block_type":"box","text":"i.e.","page_number":191,"box":{"x":332,"y":478,"width":21,"height":9}},{"id":"335098a0-f89e-43eb-ad46-83c2c07fd7dc","block_type":"box","text":", partnerships that are traded on an established securities market or","page_number":191,"box":{"x":356,"y":478,"width":507,"height":11}},{"id":"018e4a87-2c4d-4175-aa1b-3cccae5ce647","block_type":"box","text":"tradable on a secondary market, other than partnerships that derive 90% of their income from interest,","page_number":191,"box":{"x":116,"y":493,"width":764,"height":12}},{"id":"285c0398-bf43-43e1-879d-4a4ffcf8f5be","block_type":"box","text":"dividends, capital gains and other traditionally permitted mutual fund income). For purposes of this","page_number":191,"box":{"x":116,"y":508,"width":734,"height":13}},{"id":"2fe4746c-442f-4a53-bda1-c6244b10c7ae","block_type":"box","text":"restriction, the Municipal Funds generally will regard each state and each of its political subdivisions,","page_number":191,"box":{"x":117,"y":524,"width":749,"height":12}},{"id":"73eb413f-cf71-4401-be36-bd5f1daaa2b4","block_type":"box","text":"agencies or instrumentalities and each multi-state agency of which the state is a member as a","page_number":191,"box":{"x":116,"y":539,"width":703,"height":13}},{"id":"382c7da1-715d-43f2-a76b-5e350d0085f4","block_type":"box","text":"separate issuer. Each public authority that issues securities on behalf of a private entity generally will","page_number":191,"box":{"x":116,"y":555,"width":754,"height":12}},{"id":"a682b4bf-4409-4b83-892f-4ecd3e036247","block_type":"box","text":"also be regarded as a separate issuer, except that if the security is backed only by the assets and","page_number":191,"box":{"x":116,"y":570,"width":731,"height":13}},{"id":"971bb46d-abce-4a3e-b4fd-e8a5a1eac8ad","block_type":"box","text":"revenues of a non-government entity, then the entity with the ultimate responsibility for the payment of","page_number":191,"box":{"x":117,"y":586,"width":762,"height":12}},{"id":"8c98d30a-63c2-42e5-8695-366b39a2274f","block_type":"box","text":"interest and principal may be regarded as the sole issuer.","page_number":191,"box":{"x":117,"y":602,"width":431,"height":12}},{"id":"eb7fa718-7ff1-45e5-9c94-fec343f028b6","block_type":"box","text":"Foreign government securities (unlike U.S. Government Securities) are not exempt from the 5%, 10%","page_number":191,"box":{"x":117,"y":633,"width":759,"height":13}},{"id":"bc89a78f-0018-49a2-ab9b-f6baa2b6067d","block_type":"box","text":"and 25% diversification requirements of the Code discussed above and the securities of each foreign","page_number":191,"box":{"x":116,"y":649,"width":755,"height":12}},{"id":"6a4dcf07-6184-48ca-b2f6-a91f11961c0a","block_type":"box","text":"government issuer are considered to be obligations of a single issuer. These tax-related limitations","page_number":191,"box":{"x":116,"y":664,"width":732,"height":13}},{"id":"861c89fa-6f61-4f1c-a755-6b82700c8ad8","block_type":"box","text":"may be changed by the Directors of a Fund to the extent necessary to comply with changes to the U.S.","page_number":191,"box":{"x":117,"y":680,"width":763,"height":12}},{"id":"694c7479-01f5-47d7-b8ad-5950e754ac31","block_type":"box","text":"federal tax requirements. A Fund that is “diversified” under the Investment Company Act must satisfy","page_number":191,"box":{"x":116,"y":695,"width":748,"height":13}},{"id":"221b3a1e-5379-4fed-8b17-d5135a55b73e","block_type":"box","text":"the foregoing 5% and 10% requirements with respect to 75% of its total assets.","page_number":191,"box":{"x":116,"y":711,"width":586,"height":12}},{"id":"d6146172-00f0-46ca-b14f-621a99dc8e48","block_type":"box","text":"M","page_number":191,"box":{"x":310,"y":760,"width":12,"height":9}},{"id":"fbf45643-7ff7-4648-8ad9-54285fc21291","block_type":"box","text":"ANAGEMENT","page_number":191,"box":{"x":323,"y":762,"width":87,"height":7}},{"id":"d4fa4024-c2e8-48fa-98e1-dc07a315e4f2","block_type":"box","text":"AND","page_number":191,"box":{"x":415,"y":762,"width":29,"height":7}},{"id":"b7b4a66f-0167-4564-bb1e-e349f0069b8e","block_type":"box","text":"O","page_number":191,"box":{"x":450,"y":759,"width":12,"height":10}},{"id":"1109edb2-137e-4235-940c-2920865597e5","block_type":"box","text":"THER","page_number":191,"box":{"x":463,"y":762,"width":37,"height":7}},{"id":"8ff49362-aa44-4405-9383-56bb2852c6d9","block_type":"box","text":"S","page_number":191,"box":{"x":505,"y":759,"width":10,"height":10}},{"id":"46a449ca-5931-42c0-bd7b-5edecae6e34f","block_type":"box","text":"ERVICE","page_number":191,"box":{"x":517,"y":762,"width":49,"height":7}},{"id":"4a548a86-9589-4075-9171-a28cfa40db39","block_type":"box","text":"A","page_number":191,"box":{"x":571,"y":760,"width":12,"height":9}},{"id":"775c7dd6-7f0a-425c-8605-d34a1eb61b80","block_type":"box","text":"RRANGEMENTS","page_number":191,"box":{"x":584,"y":762,"width":106,"height":7}},{"id":"5888c67c-e7e1-4050-b821-0df2f775fdb5","block_type":"box","text":"Directors and Officers","page_number":191,"box":{"x":117,"y":791,"width":175,"height":10}},{"id":"ef1d560a-1613-4f2a-a115-257c07c6b5d2","block_type":"box","text":"See “Information on Directors and Officers, ‘—Biographical Information,’ ‘— Share Ownership’ and","page_number":191,"box":{"x":116,"y":815,"width":730,"height":12}},{"id":"4be34ed8-56c3-42e2-9249-a2dc6f6c92d1","block_type":"box","text":"‘— Compensation of Directors’” or “Information on Trustees and Officers, ‘—Biographical Information,’","page_number":191,"box":{"x":117,"y":831,"width":760,"height":12}},{"id":"1f501ad1-25fe-4dc2-9ce1-c577d8e79400","block_type":"box","text":"‘— Share Ownership’ and ‘— Compensation of Trustees’,” as applicable, in Part I of each Fund’s SAI","page_number":191,"box":{"x":117,"y":846,"width":754,"height":12}},{"id":"312b0ab8-835a-4e7e-8655-dd7b8f0fd9c2","block_type":"box","text":"for biographical and certain other information relating to the Directors and officers of your Fund,","page_number":191,"box":{"x":116,"y":862,"width":713,"height":12}},{"id":"14e68869-c7cc-454c-afe8-aca127d9add3","block_type":"box","text":"including Directors’ compensation.","page_number":191,"box":{"x":117,"y":877,"width":260,"height":12}},{"id":"24f18f20-6814-4e14-9d77-58851e121206","block_type":"box","text":"II-104","page_number":191,"box":{"x":479,"y":909,"width":41,"height":9}},{"id":"3e2dc904-b906-472c-8a03-127237aea728","block_type":"box","text":"NM1026U-6004382-191/605","page_number":191,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"0434b548-344f-4e46-a501-9f4a48362b69","block_type":"box","text":"Management Arrangements","page_number":192,"box":{"x":117,"y":87,"width":225,"height":12}},{"id":"fa3977d0-ffea-4492-b34d-d47d7834d1cc","block_type":"box","text":"Management Services.","page_number":192,"box":{"x":116,"y":110,"width":170,"height":12}},{"id":"729c74b3-d942-4af4-979e-507d21b288d8","block_type":"box","text":"The Manager provides each Fund with investment advisory and management","page_number":192,"box":{"x":288,"y":110,"width":585,"height":12}},{"id":"f0ddf306-9031-456c-8d8e-08f3c6d4bf8d","block_type":"box","text":"services. Subject to the oversight of the Board of Directors, the Manager is responsible for the actual","page_number":192,"box":{"x":116,"y":126,"width":752,"height":12}},{"id":"fa16e590-5e4a-4960-a6db-f3bd94192be4","block_type":"box","text":"management of a Fund’s portfolio and reviews the Fund’s holdings in light of its own research analysis","page_number":192,"box":{"x":117,"y":141,"width":764,"height":12}},{"id":"8f725059-97c3-4093-9331-893315090ca0","block_type":"box","text":"and that from other relevant sources. The responsibility for making decisions to buy, sell or hold a","page_number":192,"box":{"x":116,"y":157,"width":729,"height":12}},{"id":"9b34bc55-a428-43ce-bc9a-21b3bc536d7d","block_type":"box","text":"particular security rests with the Manager. The Manager performs certain of the other administrative","page_number":192,"box":{"x":117,"y":172,"width":745,"height":12}},{"id":"08484e76-6f92-413c-988b-0a07c0d13d4a","block_type":"box","text":"services and provides all the office space, facilities, equipment and necessary personnel for","page_number":192,"box":{"x":116,"y":188,"width":685,"height":12}},{"id":"5164ef61-58e2-4d94-8b57-896bf6b15653","block_type":"box","text":"management of each Fund.","page_number":192,"box":{"x":117,"y":203,"width":209,"height":12}},{"id":"6e5f94db-e423-4009-840b-995cb8fc1c37","block_type":"box","text":"Each Feeder Fund invests all or a portion of its assets in shares of a Master Portfolio. To the extent a","page_number":192,"box":{"x":117,"y":234,"width":755,"height":12}},{"id":"8a6d8623-60ca-49fa-8611-2b2dd2bebc7a","block_type":"box","text":"Feeder Fund invests all of its assets in a Master Portfolio, it does not invest directly in portfolio","page_number":192,"box":{"x":117,"y":250,"width":702,"height":12}},{"id":"94e9c106-6e3b-40fa-ab52-35b16392f4f9","block_type":"box","text":"securities and does not require management services. For such Feeder Funds, portfolio management","page_number":192,"box":{"x":116,"y":265,"width":760,"height":12}},{"id":"5ad72ed4-6fe3-42e8-b27c-2caf4c550ba9","block_type":"box","text":"occurs at the Master Portfolio level.","page_number":192,"box":{"x":116,"y":281,"width":267,"height":9}},{"id":"942c3a70-009d-4ced-be4e-6ead351b2dad","block_type":"box","text":"Management Fee.","page_number":192,"box":{"x":116,"y":312,"width":132,"height":12}},{"id":"8712df93-0d1d-431e-9ee2-d009347769db","block_type":"box","text":"Each Fund has entered into a Management A","page_number":192,"box":{"x":250,"y":312,"width":326,"height":12}},{"id":"89627a79-a701-42f7-8761-8b6ead96c7c8","block_type":"box","text":"Agreement with the Manager pursuant to","page_number":192,"box":{"x":576,"y":312,"width":304,"height":12}},{"id":"1ec9f38e-4c5e-4130-bf21-8407b7c74f80","block_type":"box","text":"which the Manager receives for its services to","page_number":192,"box":{"x":116,"y":327,"width":337,"height":12}},{"id":"295e847d-e983-4bdc-9ac4-aa4e557a8b4a","block_type":"box","text":"the Fund monthly compensation at an annual rate based","page_number":192,"box":{"x":453,"y":327,"width":417,"height":12}},{"id":"7d5080f4-4090-4831-9ffc-b7824162405a","block_type":"box","text":"on the average daily net assets of the Fund. For info","page_number":192,"box":{"x":116,"y":343,"width":380,"height":12}},{"id":"89ff2b5f-101f-4814-93e5-48b3019c1cb3","block_type":"box","text":"rmation regarding the fees paid by your Fund to the","page_number":192,"box":{"x":497,"y":343,"width":378,"height":12}},{"id":"88db7423-d0ef-48bc-a3c5-eb1c09b1c2a0","block_type":"box","text":"Manager for the Fund’s last three fiscal years or","page_number":192,"box":{"x":117,"y":358,"width":352,"height":12}},{"id":"8b77fe9d-dfc2-4428-899f-0c289251a778","block_type":"box","text":"other applicable periods, see “Management, Advisory","page_number":192,"box":{"x":469,"y":358,"width":393,"height":12}},{"id":"3be97b57-2e12-4034-b5ca-607223f81171","block_type":"box","text":"and Other Service Arrangements — Management A","page_number":192,"box":{"x":116,"y":374,"width":368,"height":12}},{"id":"c6c22fd0-bcf9-4e66-9229-c61086689c37","block_type":"box","text":"Agreement” or “Management and Advisory","page_number":192,"box":{"x":484,"y":374,"width":316,"height":12}},{"id":"06df6d21-4087-46df-824b-1a720f0ce88a","block_type":"box","text":"Arrangements,” as applicable, in Part I of each Fund’s SAI.","page_number":192,"box":{"x":116,"y":389,"width":433,"height":12}},{"id":"6b6b0c2e-35b6-4632-b7cd-3d3f03be374b","block_type":"box","text":"For Funds that do not have an administrator, each Management Agreement obligates the Manager to","page_number":192,"box":{"x":117,"y":420,"width":757,"height":12}},{"id":"615b9663-237f-4dfa-a585-f94c9c5f4f75","block_type":"box","text":"provide management services and to pay all compensation of and furnish office space for officers and","page_number":192,"box":{"x":117,"y":436,"width":760,"height":12}},{"id":"fd7d3058-7056-4947-b870-2cca064ba376","block_type":"box","text":"employees of a Fund in connection with investment and economic research, trading and investment","page_number":192,"box":{"x":116,"y":451,"width":745,"height":12}},{"id":"95a6d5fc-2ae6-478a-9559-a3fc689efee7","block_type":"box","text":"management of the Fund, as well as the fees of all Directors of the Fund who are interested persons of","page_number":192,"box":{"x":117,"y":467,"width":768,"height":12}},{"id":"9207d573-c1cb-4bad-89a3-ee693f4e07db","block_type":"box","text":"the Fund. Each Fund pays all other expenses incurred in the operation of that Fund, including among","page_number":192,"box":{"x":116,"y":482,"width":756,"height":12}},{"id":"1581f795-6777-4ed7-b84c-46d5c3dc76d9","block_type":"box","text":"other things: taxes; expenses for legal and auditing services; costs of preparing, printing and mailing","page_number":192,"box":{"x":116,"y":498,"width":749,"height":12}},{"id":"9cd61e04-6e35-46f0-b62c-18958c82db62","block_type":"box","text":"proxies, shareholder reports, prospectuses and statements of additional information, except to the","page_number":192,"box":{"x":117,"y":513,"width":732,"height":12}},{"id":"a0c0a97d-631e-4f51-b3f1-5705fa8526f4","block_type":"box","text":"extent paid by BlackRock Investments, LLC (“BRIL” or the “Distributor”); charges of the custodian and","page_number":192,"box":{"x":116,"y":529,"width":760,"height":12}},{"id":"63c7fe7a-8a44-4547-95f3-078679f3c9f2","block_type":"box","text":"sub-custodian, and the transfer agent; expenses of redemption of shares; Commission fees; expenses","page_number":192,"box":{"x":116,"y":544,"width":766,"height":12}},{"id":"0cb257bc-ba37-4d23-80f5-91ec9588a560","block_type":"box","text":"of registering the shares under Federal, state or foreign laws; fees and expenses of Directors who are","page_number":192,"box":{"x":116,"y":560,"width":761,"height":12}},{"id":"6302a10c-b920-493e-8353-fb6195d9590a","block_type":"box","text":"not interested persons of a Fund as defined in the Investment Company Act; accounting and pricing","page_number":192,"box":{"x":117,"y":575,"width":745,"height":12}},{"id":"c14ee689-81a0-4af0-8ed8-06a560b2f39e","block_type":"box","text":"costs (including the daily calculations of NAV); insurance; interest; brokerage costs; litigation and other","page_number":192,"box":{"x":116,"y":591,"width":767,"height":12}},{"id":"7cf818b7-72fa-44f5-b9ab-bd2e7ab524df","block_type":"box","text":"extraordinary or non-recurring expenses; and other expenses properly payable by the Fund. Certain","page_number":192,"box":{"x":116,"y":606,"width":747,"height":12}},{"id":"3de800fe-6f9c-4d0e-baf6-7644105b7ce5","block_type":"box","text":"accounting services are provided to each Fund by State Street Bank and Trust Company (“State","page_number":192,"box":{"x":116,"y":622,"width":720,"height":12}},{"id":"e90e309d-91ab-4a56-8223-d6a3afc87451","block_type":"box","text":"Street”), BNY Mellon Investment Servicing (US) Inc. (“BNY Mellon”) or JPMorgan Chase Bank, N.A.","page_number":192,"box":{"x":116,"y":637,"width":746,"height":12}},{"id":"8aa37def-5d1c-42f8-9d19-357c8e9ebd25","block_type":"box","text":"(“JPM”) pursuant to an agreement between State Street, BNY Mellon or JPM, as applicable, and each","page_number":192,"box":{"x":117,"y":653,"width":761,"height":12}},{"id":"f7c416c5-b025-422f-baae-d9c4e738712f","block_type":"box","text":"Fund. Each Fund pays a fee for these services. In addition, the Manager provides certain accounting","page_number":192,"box":{"x":117,"y":668,"width":746,"height":12}},{"id":"82b653db-3a7d-41f9-97d3-41d1c9796af6","block_type":"box","text":"services to each Fund and the Fund pays the Manager a fee for such services. The Distributor pays","page_number":192,"box":{"x":116,"y":684,"width":740,"height":12}},{"id":"239d9239-02ce-49cb-b9e6-2aca2fa75083","block_type":"box","text":"certain promotional expenses of the Funds incurred in connection with the offering of shares of the","page_number":192,"box":{"x":116,"y":699,"width":731,"height":13}},{"id":"2a3772e7-6460-46c9-8e94-98b3f0d51844","block_type":"box","text":"Funds. Certain expenses are financed by each Fund pursuant to distribution plans in compliance with","page_number":192,"box":{"x":117,"y":715,"width":751,"height":12}},{"id":"033a4ba5-6492-4959-8646-ba20e4aaa3f6","block_type":"box","text":"Rule 12b-1 under the Investment Company Act. See “Purchase of Shares — Distribution and/or","page_number":192,"box":{"x":117,"y":730,"width":710,"height":13}},{"id":"0afbf771-b875-4aaa-b4e8-ef5f5d87a56b","block_type":"box","text":"Shareholder Servicing Plans.”","page_number":192,"box":{"x":116,"y":746,"width":221,"height":12}},{"id":"1d519edf-70f2-49aa-8563-791d4f5f99e5","block_type":"box","text":"Sub-Advisory Fee.","page_number":192,"box":{"x":117,"y":777,"width":135,"height":12}},{"id":"5e0f3734-7101-43d0-a838-2eb841b727a7","block_type":"box","text":"The Manager of certain Funds has entered into one or more sub-advisory","page_number":192,"box":{"x":259,"y":777,"width":546,"height":12}},{"id":"5342a721-c4d0-47af-b876-e3dce66ab614","block_type":"box","text":"agreements (the “Sub-Advisory Agreements”) with the sub-adviser or sub-advisers identified in each","page_number":192,"box":{"x":116,"y":792,"width":743,"height":13}},{"id":"cb5d4113-ce89-42d2-b1e3-6e5a3df04ad3","block_type":"box","text":"such Fund’s Prospectus (the “Sub-Adviser”) pursuant to which the Sub-Adviser provides sub-advisory","page_number":192,"box":{"x":116,"y":808,"width":755,"height":12}},{"id":"0ed9ed2a-b3a8-4213-bf76-85833f9a4b18","block_type":"box","text":"services to the Manager with respect to the Fund.","page_number":192,"box":{"x":116,"y":824,"width":367,"height":12}},{"id":"6b7ff13a-6ef2-446c-bdb0-84635574f25f","block_type":"box","text":"Organization of the Manager.","page_number":192,"box":{"x":117,"y":854,"width":215,"height":13}},{"id":"f1c856a4-83e5-4044-a6dc-98eb6ae3a1bb","block_type":"box","text":"BlackRock Advisors, LLC is a Delaware limited liability company and","page_number":192,"box":{"x":334,"y":854,"width":519,"height":13}},{"id":"c95fd6b2-b719-4ba1-ad53-83829b57bce5","block_type":"box","text":"BlackRock Fund Advisors is a California corporation. Each Manager is an indirect, majority-owned","page_number":192,"box":{"x":117,"y":870,"width":732,"height":12}},{"id":"24832a4a-35d9-49d4-affd-c5f1dd51a530","block_type":"box","text":"II-105","page_number":192,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"72dfc08c-52ea-4c2e-95db-928cee61136c","block_type":"box","text":"NM1026U-6004382-192/605","page_number":192,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"cf161ad6-8dcc-49a9-a638-728de62c0db0","block_type":"box","text":"subsidiary of BlackRock, Inc. BlackRock, Inc., through its subsidiaries and divisions, provides","page_number":193,"box":{"x":116,"y":87,"width":697,"height":12}},{"id":"92e4c0ec-b7b1-4dea-9181-1be538e85be2","block_type":"box","text":"(i) investment management services to individuals and institutional investors through separate account","page_number":193,"box":{"x":117,"y":102,"width":765,"height":13}},{"id":"ba8355e9-1acd-4319-bcde-e91d64dbd6d5","block_type":"box","text":"management, non-discretionary advisory programs and commingled investment vehicles; (ii) risk","page_number":193,"box":{"x":117,"y":118,"width":722,"height":12}},{"id":"4244bd12-fcfa-4436-91b5-cf0f1f9d9963","block_type":"box","text":"management services, investment accounting and trade processing tools; (iii) transition management","page_number":193,"box":{"x":117,"y":134,"width":755,"height":12}},{"id":"d3fbea6c-f5ec-42d2-baa6-ae26ccb0b9b8","block_type":"box","text":"services, and (iv) securities lending services.","page_number":193,"box":{"x":116,"y":149,"width":337,"height":12}},{"id":"57660dd4-fc6a-47d1-b76d-c618cad6c3af","block_type":"box","text":"Duration and Termination.","page_number":193,"box":{"x":116,"y":180,"width":193,"height":10}},{"id":"7432976b-62b0-498e-ba6f-710f5df54770","block_type":"box","text":"Unless earlier terminated as described below, each Management","page_number":193,"box":{"x":310,"y":180,"width":494,"height":12}},{"id":"08a05454-20af-41b3-8e26-d1625d8c084b","block_type":"box","text":"Agreement and each Sub-Advisory Agreement will remain in effect for an initial two year period and","page_number":193,"box":{"x":116,"y":196,"width":743,"height":12}},{"id":"b6cc237d-0213-484a-88fd-d5f1afb79ab4","block_type":"box","text":"from year to year thereafter if approved annually (a) by the Board of Directors or by a vote of a majority","page_number":193,"box":{"x":116,"y":211,"width":769,"height":12}},{"id":"8c5145c6-5af2-4fc8-b237-f7b59ff9d2bf","block_type":"box","text":"of the outstanding voting securities of a Fund and (b) by a majority of the Directors of the Fund who are","page_number":193,"box":{"x":116,"y":227,"width":771,"height":12}},{"id":"f11bae28-686a-4782-a3a3-3aa710658f5c","block_type":"box","text":"not parties to such agreement or interested persons (as defined in the Investment Company Act) of","page_number":193,"box":{"x":117,"y":242,"width":740,"height":12}},{"id":"7b9422d1-2add-49d7-8c15-38cda8d4a68d","block_type":"box","text":"any such party. Each Management Agreement automatically terminates on assignment and may be","page_number":193,"box":{"x":116,"y":258,"width":745,"height":12}},{"id":"b01b0ac2-fd04-46c6-86a2-31b467c10fa0","block_type":"box","text":"terminated without penalty on 60 days’ written notice at the option of either party thereto or by the vote","page_number":193,"box":{"x":116,"y":273,"width":765,"height":12}},{"id":"aed0a67e-efb6-4ea5-ba31-c1d10dadee65","block_type":"box","text":"of the shareholders of the applicable Fund.","page_number":193,"box":{"x":116,"y":289,"width":323,"height":12}},{"id":"593752eb-86bd-4311-aa2d-c39ccbb31b58","block_type":"box","text":"Other Service Arrangements","page_number":193,"box":{"x":116,"y":320,"width":233,"height":12}},{"id":"99e9bc42-2c57-492b-9499-78c27b2fccb8","block_type":"box","text":"Administrative Services and Administrative Fee.","page_number":193,"box":{"x":115,"y":343,"width":355,"height":9}},{"id":"f9e5bcc0-bafa-4d77-99f1-315f5709ea06","block_type":"box","text":"Certain Funds have entered into an administration","page_number":193,"box":{"x":472,"y":343,"width":383,"height":9}},{"id":"22e32c27-7bb4-415b-9e53-623c3afd514b","block_type":"box","text":"agreement (the “Administration Agreement”) with an administrator identified in the Fund’s Prospectus","page_number":193,"box":{"x":116,"y":358,"width":756,"height":12}},{"id":"b93e2208-88ee-4a6c-a37a-e1a8970b340a","block_type":"box","text":"and Part I of the Fund’s SAI (each an “Administrator”). For its services to a Fund, the Administrator","page_number":193,"box":{"x":116,"y":374,"width":737,"height":12}},{"id":"c57030f2-21a8-4ad3-be2a-9407bc27c5aa","block_type":"box","text":"receives monthly compensation at the annual rate set forth in each applicable Fund’s Prospectus. For","page_number":193,"box":{"x":117,"y":389,"width":758,"height":12}},{"id":"166e01b5-2b22-4380-af1a-bfd21cd1bdfa","block_type":"box","text":"information regarding any administrative fees paid by your Fund to the Administrator for the periods","page_number":193,"box":{"x":117,"y":405,"width":742,"height":12}},{"id":"cb3db0a1-29bd-47f1-96d3-cab4e62d5bd7","block_type":"box","text":"indicated, see “Management, Advisory and Other Service Arrangements — Administration Agreement”","page_number":193,"box":{"x":117,"y":420,"width":766,"height":12}},{"id":"dfea92f8-d0a9-4fbd-9a03-a56a8956506e","block_type":"box","text":"or “Management and Advisory Arrangements,” as applicable, in Part I of that Fund’s SAI.","page_number":193,"box":{"x":116,"y":436,"width":664,"height":12}},{"id":"e76d9d9d-4930-4186-9856-8bc7f91154d6","block_type":"box","text":"For Funds that have an Administrator, the Administration Agreement obligates the Administrator to","page_number":193,"box":{"x":117,"y":467,"width":735,"height":12}},{"id":"a891964e-2a71-49ac-a3c2-0cc84addfccc","block_type":"box","text":"provide certain administrative services to the Fund and to pay, or cause its affiliates to pay, for","page_number":193,"box":{"x":117,"y":482,"width":703,"height":12}},{"id":"ee0d5d34-88e1-4d4b-be9f-44403d5a7143","block_type":"box","text":"maintaining its staff and personnel and to provide office space, facilities and necessary personnel for","page_number":193,"box":{"x":117,"y":498,"width":751,"height":12}},{"id":"b79668df-bc4a-486f-ba9c-32a96b54a89d","block_type":"box","text":"the Fund. Each Administrator is also obligated to pay, or cause its affiliates to pay, the fees of those","page_number":193,"box":{"x":116,"y":513,"width":745,"height":12}},{"id":"ad9ac2ef-bd31-4251-b807-cef6fcecc29a","block_type":"box","text":"officers and Directors of the Fund who are affiliated persons of the Administrator or any of its affiliates.","page_number":193,"box":{"x":116,"y":529,"width":764,"height":12}},{"id":"c3801be2-0f1b-4ab4-a78d-57bff6985a21","block_type":"box","text":"Duration and Termination of Administration Agreement.","page_number":193,"box":{"x":116,"y":560,"width":410,"height":12}},{"id":"c2aba37f-1a9d-49c1-8904-7eb29ccad22a","block_type":"box","text":"Unless earlier terminated as described below,","page_number":193,"box":{"x":527,"y":560,"width":350,"height":11}},{"id":"527b04ee-4c46-4101-9e27-65c20dfc1a78","block_type":"box","text":"each Administration Agreement with BlackRock will continue for an initial two year period and from","page_number":193,"box":{"x":116,"y":575,"width":736,"height":12}},{"id":"a80cce8e-3855-43ea-8d3e-20ba6db7c815","block_type":"box","text":"year to year if approved annually (a) by the Board of Directors of each applicable Fund or by a vote of","page_number":193,"box":{"x":116,"y":591,"width":760,"height":12}},{"id":"90e03888-8adf-4185-8f9f-bbc06bd12892","block_type":"box","text":"a majority of the outstanding voting securities of such Fund and (b) by a majority of the Directors of the","page_number":193,"box":{"x":116,"y":606,"width":767,"height":12}},{"id":"6e533524-57b5-4694-a0e9-5a516de233d8","block_type":"box","text":"Fund who are not parties to such contract or interested persons (as defined in the Investment","page_number":193,"box":{"x":117,"y":622,"width":697,"height":12}},{"id":"d15c6904-44ea-4cfc-945b-85de305b8505","block_type":"box","text":"Company Act) of any such party. Such contract is not assignable and may be terminated without","page_number":193,"box":{"x":117,"y":637,"width":720,"height":12}},{"id":"f2295c29-8a56-4308-9f90-597709fe816b","block_type":"box","text":"penalty on written notice at the option of either party thereto or by the vote of the shareholders of the","page_number":193,"box":{"x":117,"y":653,"width":750,"height":12}},{"id":"0fad2f24-3e54-495f-b6c6-21136f4f966e","block_type":"box","text":"Fund.","page_number":193,"box":{"x":117,"y":669,"width":40,"height":9}},{"id":"695776a1-1771-42dd-a42c-29c43bf0a15b","block_type":"box","text":"Transfer Agency Services.","page_number":193,"box":{"x":118,"y":699,"width":193,"height":13}},{"id":"a5731945-9892-42d5-8434-34a4e36d5b2b","block_type":"box","text":"BNY Mellon Investment Servicing (US) Inc. (in this capacity, the “Transfer","page_number":193,"box":{"x":319,"y":699,"width":546,"height":13}},{"id":"d6e48804-94b6-4252-9f66-3a50cd64a3f0","block_type":"box","text":"Agent”), a subsidiary of The Bank of New York Mellon Corporation, acts as each Fund’s Transfer","page_number":193,"box":{"x":116,"y":715,"width":719,"height":12}},{"id":"f13806d1-719c-4cad-8773-4918226a444b","block_type":"box","text":"Agent pursuant to a Transfer Agency, Dividend Disbursing Agency and Shareholder Servicing Agency","page_number":193,"box":{"x":116,"y":730,"width":758,"height":13}},{"id":"b52e484c-cc7d-4a5c-be3b-fca7b8dc9b07","block_type":"box","text":"Agreement (the “Transfer Agency Agreement”) with the Funds. Pursuant to the Transfer Agency","page_number":193,"box":{"x":116,"y":746,"width":714,"height":12}},{"id":"0f3dcf21-d19b-4988-a0a1-e32e269d6349","block_type":"box","text":"Agreement, the Transfer Agent is responsible for the issuance, transfer and redemption of shares and","page_number":193,"box":{"x":116,"y":761,"width":756,"height":13}},{"id":"b27bda3d-d443-45d5-baba-83ca6b5bf115","block_type":"box","text":"the opening and maintenance of shareholder accounts. Each Fund pays the Transfer Agent a fee for","page_number":193,"box":{"x":116,"y":777,"width":748,"height":12}},{"id":"7b2b5adb-d977-491e-af05-c519f2c19c3a","block_type":"box","text":"the services it receives based on the type of account and the level of services required. 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(collectively referred to in this section as “BlackRock”) and their","page_number":202,"box":{"x":116,"y":314,"width":707,"height":12}},{"id":"2f99532e-cfb5-4cfb-a5b8-6d7b88e6baae","block_type":"box","text":"respective directors, officers or employees, with respect to the Funds and/or other accounts managed","page_number":202,"box":{"x":116,"y":329,"width":760,"height":12}},{"id":"023d25f5-bb19-4c7e-9521-631c08508e6c","block_type":"box","text":"by BlackRock, may give rise to actual or perceived conflicts of interest such as those described below.","page_number":202,"box":{"x":116,"y":345,"width":764,"height":12}},{"id":"86fbb293-de1e-4d9a-9aec-bebb6d0cc996","block_type":"box","text":"BlackRock is one of the world’s largest asset management firms. BlackRock, its subsidiaries and their","page_number":202,"box":{"x":117,"y":377,"width":759,"height":12}},{"id":"507d890e-efc6-4f96-b8e8-3c1de6e415eb","block_type":"box","text":"respective directors, officers and employees, including the business units or entities and personnel","page_number":202,"box":{"x":117,"y":392,"width":736,"height":12}},{"id":"bd86befc-c5c4-4192-bc4c-dfb1334d6c79","block_type":"box","text":"who may be involved in the investment activities and business operations of a Fund, are engaged","page_number":202,"box":{"x":116,"y":408,"width":729,"height":12}},{"id":"875caf7f-4d28-460b-aa56-dbbc13e1d9d1","block_type":"box","text":"worldwide in businesses, including managing equities, fixed income securities, cash and alternative","page_number":202,"box":{"x":116,"y":423,"width":742,"height":12}},{"id":"61274ff3-e407-4ec3-bd59-5bb7984fb6e6","block_type":"box","text":"investments, and other financial services, and have interests other than that of managing the Funds.","page_number":202,"box":{"x":117,"y":439,"width":748,"height":12}},{"id":"8a0a3e7a-8ff1-46af-9c77-6cf1388a8706","block_type":"box","text":"These are considerations of which investors in a Fund should be aware, and which may cause conflicts","page_number":202,"box":{"x":116,"y":454,"width":771,"height":12}},{"id":"a017bfc2-57ac-4a43-b5df-fc9e61ff572d","block_type":"box","text":"of interest that could disadvantage a Fund and its shareholders.","page_number":202,"box":{"x":116,"y":470,"width":479,"height":12}},{"id":"6386a2c7-e5bb-4d48-bf74-0e9c66044c57","block_type":"box","text":"These businesses and interests include potential multiple advisory, transactional, financial and other","page_number":202,"box":{"x":116,"y":502,"width":749,"height":12}},{"id":"20d7d716-3f1a-4bd6-ba2f-d85a223fc910","block_type":"box","text":"relationships with, or interests in companies and interests in securities or other instruments that may be","page_number":202,"box":{"x":117,"y":518,"width":771,"height":12}},{"id":"77561c2b-1768-44c5-bcbe-1a395f226ec1","block_type":"box","text":"purchased or sold by a Fund.","page_number":202,"box":{"x":117,"y":533,"width":221,"height":12}},{"id":"3cc65f94-67e8-4252-9071-ef06972805e9","block_type":"box","text":"BlackRock may have proprietary interests in, and may manage or advise with respect to, accounts or","page_number":202,"box":{"x":117,"y":565,"width":754,"height":12}},{"id":"1c826fa8-8c53-48e2-9e8f-7b86f676d8ca","block_type":"box","text":"funds (including separate accounts and other funds and collective investment vehicles) that have","page_number":202,"box":{"x":116,"y":581,"width":724,"height":12}},{"id":"2b4c9e42-271c-4155-bcbc-f040b97e19b9","block_type":"box","text":"investment objectives identical or similar to those of a Fund and/or that engage in transactions in the","page_number":202,"box":{"x":117,"y":596,"width":749,"height":12}},{"id":"99db6d81-4cd9-4503-b0d2-79e97b89c76f","block_type":"box","text":"same types of securities, currencies and instruments as the Fund. Such other funds or accounts may","page_number":202,"box":{"x":116,"y":612,"width":755,"height":12}},{"id":"f8dab75f-6617-4fac-95f5-51d4d77590b1","block_type":"box","text":"offer exposure to strategies that are identical or substantially similar to those of a Fund but with","page_number":202,"box":{"x":116,"y":627,"width":710,"height":12}},{"id":"15c2f749-f55f-46a3-a87d-b4d0e96940b4","block_type":"box","text":"different fees and expenses, governance and structures, and/or services provided by BlackRock.","page_number":202,"box":{"x":116,"y":643,"width":724,"height":12}},{"id":"31d46367-4249-4ef8-850b-22cb52de4d3c","block_type":"box","text":"BlackRock is also a major participant in the global currency, equities, swap and fixed income markets,","page_number":202,"box":{"x":117,"y":658,"width":760,"height":12}},{"id":"d010cfda-23b9-46f2-8a6c-dd60e9dba034","block_type":"box","text":"in each case, for the accounts of clients and, in some cases, on a proprietary basis. As such,","page_number":202,"box":{"x":117,"y":674,"width":687,"height":12}},{"id":"dcaacb2e-3c1b-450a-b141-04d97857b023","block_type":"box","text":"BlackRock is or may be actively engaged in transactions in the same securities, currencies, and","page_number":202,"box":{"x":117,"y":689,"width":709,"height":12}},{"id":"126fcd5d-69c0-492d-9b18-28ce9322e964","block_type":"box","text":"instruments in which a Fund invests.","page_number":202,"box":{"x":117,"y":705,"width":268,"height":9}},{"id":"40269bcf-6eb1-4838-8929-a1d4915d1c01","block_type":"box","text":"Such activities could affect the prices and availability of the securities, currencies, and instruments in","page_number":202,"box":{"x":116,"y":737,"width":746,"height":12}},{"id":"2a842fd8-97e4-416f-b3b8-bfe25973a890","block_type":"box","text":"which a Fund invests, which could have an adverse impact on a Fund’s performance. Such","page_number":202,"box":{"x":116,"y":752,"width":676,"height":12}},{"id":"afb0dcf6-bb7e-4063-b389-0140e1d82e01","block_type":"box","text":"transactions, particularly in respect of most proprietary accounts or client accounts, will be executed","page_number":202,"box":{"x":116,"y":768,"width":740,"height":12}},{"id":"36d68ad0-daf6-474c-89b4-f61ffbe09165","block_type":"box","text":"independently of a Fund’s transactions and thus at prices or rates that may be more or less favorable","page_number":202,"box":{"x":117,"y":783,"width":750,"height":12}},{"id":"53892669-20d2-4952-997e-54e22246485a","block_type":"box","text":"than those obtained by the Fund.","page_number":202,"box":{"x":116,"y":799,"width":244,"height":12}},{"id":"ea819adf-fe6a-4aa6-982a-087f2a52f37a","block_type":"box","text":"In addition, the portfolio holdings of certain BlackRock-advised investment vehicles managed in an","page_number":202,"box":{"x":117,"y":831,"width":735,"height":12}},{"id":"35645bd7-fe8a-45ce-a1a9-11e7b951715e","block_type":"box","text":"identical or substantially similar manner as certain Funds are made publicly available on a more timely","page_number":202,"box":{"x":117,"y":847,"width":763,"height":12}},{"id":"77c55d75-6ae3-4bda-a002-94c399897f0e","block_type":"box","text":"basis than the applicable Fund. 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While not expected, it is possible that a recipient of portfolio holdings information for such","page_number":202,"box":{"x":116,"y":877,"width":769,"height":13}},{"id":"a102e7f2-f674-446d-8fca-8f46486b212c","block_type":"box","text":"II-115","page_number":202,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"a32b2c83-8780-4ec3-8222-fe13d0f55a0c","block_type":"box","text":"NM1026U-6004382-202/605","page_number":202,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ab2929e9-2b19-420c-afc9-3b43a8b202bc","block_type":"box","text":"an investment vehicle could cause harm to a Fund that is managed in an identical or substantially","page_number":203,"box":{"x":116,"y":87,"width":729,"height":12}},{"id":"88ec0b5e-a13a-484f-90da-8de88822934f","block_type":"box","text":"similar manner, including by trading ahead of or against such Fund based on the information received.","page_number":203,"box":{"x":116,"y":102,"width":764,"height":13}},{"id":"cea08121-0c29-47a2-990f-eb9f2b33684a","block_type":"box","text":"When BlackRock seeks to purchase or sell the same assets for client accounts, including a Fund, the","page_number":203,"box":{"x":116,"y":134,"width":757,"height":12}},{"id":"2db1bec5-1791-446c-a26f-c942d0eedc8a","block_type":"box","text":"assets actually purchased or sold may be allocated among the accounts on a basis determined in its","page_number":203,"box":{"x":116,"y":149,"width":751,"height":12}},{"id":"c76fec4b-7ce3-412d-9bea-b93e6f1a40e4","block_type":"box","text":"good faith discretion to be equitable. In some cases, this system may adversely affect the size or price","page_number":203,"box":{"x":116,"y":165,"width":764,"height":12}},{"id":"e3f84295-072a-4a92-8486-04f11d233157","block_type":"box","text":"of the assets purchased or sold for a Fund. In addition, transactions in investments by one or more","page_number":203,"box":{"x":116,"y":180,"width":737,"height":12}},{"id":"c4b18fbf-d195-4acb-aff4-df7d4aedd40e","block_type":"box","text":"other accounts managed by BlackRock may have the effect of diluting or otherwise disadvantaging the","page_number":203,"box":{"x":116,"y":196,"width":767,"height":12}},{"id":"4fb620be-e804-438a-9275-6a24dd9ecd35","block_type":"box","text":"values, prices or investment strategies of a Fund, particularly, but not limited to, with respect to small","page_number":203,"box":{"x":116,"y":211,"width":752,"height":12}},{"id":"66016203-8036-4882-88b4-c0a90441e99d","block_type":"box","text":"capitalization, emerging market or less liquid strategies. This may occur with respect to BlackRock","page_number":203,"box":{"x":116,"y":227,"width":735,"height":12}},{"id":"6e19f835-6512-406e-843a-0eb8edf80542","block_type":"box","text":"advised accounts when investment decisions regarding a Fund are based on research or other","page_number":203,"box":{"x":116,"y":242,"width":709,"height":12}},{"id":"1fcdf413-fe37-49d8-971c-d395562165e6","block_type":"box","text":"information that is also used to support decisions for other accounts. When BlackRock implements a","page_number":203,"box":{"x":117,"y":258,"width":749,"height":11}},{"id":"a42af4d7-4047-4bd6-8ec3-44ec58a284ec","block_type":"box","text":"portfolio decision or strategy on behalf of another account ahead of, or contemporaneously with, similar","page_number":203,"box":{"x":117,"y":273,"width":771,"height":12}},{"id":"f7478adf-e7ec-4fc7-b64d-f1fbcce19a04","block_type":"box","text":"decisions or strategies for a Fund, market impact, liquidity constraints, or other factors could result in","page_number":203,"box":{"x":116,"y":289,"width":751,"height":12}},{"id":"798356b7-4a5f-42d6-8ccb-4e8418153b29","block_type":"box","text":"the Fund receiving less favorable trading results and the costs of implementing such decisions or","page_number":203,"box":{"x":116,"y":304,"width":725,"height":12}},{"id":"b062611b-faaf-43be-ae8e-4d5b29616ce4","block_type":"box","text":"strategies could be increased or the Fund could otherwise be disadvantaged. BlackRock may, in","page_number":203,"box":{"x":116,"y":320,"width":721,"height":12}},{"id":"607e7d7d-769c-4472-9076-1d4be4018e3f","block_type":"box","text":"certain cases, elect to implement internal policies and procedures designed to limit such","page_number":203,"box":{"x":116,"y":335,"width":658,"height":12}},{"id":"b31a4bc9-b561-43e4-befe-b25d02201e54","block_type":"box","text":"consequences, which may cause a Fund to be unable to engage in certain activities, including","page_number":203,"box":{"x":116,"y":351,"width":703,"height":12}},{"id":"366bf610-23f8-4584-be91-df73bb0a8a33","block_type":"box","text":"purchasing or disposing of securities, when it might otherwise be desirable for it to do so. Conflicts may","page_number":203,"box":{"x":117,"y":366,"width":770,"height":12}},{"id":"a69f5ef8-0d32-493e-870f-daede1c32a8c","block_type":"box","text":"also arise because portfolio decisions regarding a Fund may benefit other accounts managed by","page_number":203,"box":{"x":116,"y":382,"width":721,"height":12}},{"id":"d6a0921a-862d-4c9a-bb54-b8363d5f8c5e","block_type":"box","text":"BlackRock. For example, the sale of a long position or","page_number":203,"box":{"x":117,"y":397,"width":406,"height":12}},{"id":"b0b880aa-b0e5-46cd-a728-607d05896d80","block_type":"box","text":"establishment of a short position by a Fund may","page_number":203,"box":{"x":523,"y":397,"width":362,"height":12}},{"id":"62a404d7-aa74-4115-9cd1-fbcae9c01ed3","block_type":"box","text":"impair the price of the same security sold short by (and therefore benefit) BlackRock or its other","page_number":203,"box":{"x":117,"y":413,"width":714,"height":12}},{"id":"178006f6-7f6e-4400-a204-2f0537bf6fca","block_type":"box","text":"accounts or funds, and the purchase of a security or covering of a short position in a security by a Fund","page_number":203,"box":{"x":116,"y":428,"width":772,"height":12}},{"id":"b89d6dad-2e3a-4f92-96be-9614b78966dd","block_type":"box","text":"may increase the price of the same security held by (and therefore benefit) BlackRock or its other","page_number":203,"box":{"x":117,"y":444,"width":727,"height":12}},{"id":"720038f6-8185-47e8-a23c-6c22cea82a83","block_type":"box","text":"accounts or funds.","page_number":203,"box":{"x":116,"y":459,"width":142,"height":10}},{"id":"416b8e39-9ef4-438b-94a1-85af3011ae53","block_type":"box","text":"BlackRock, on behalf of other client accounts, on the one hand, and a Fund, on the other hand, may","page_number":203,"box":{"x":117,"y":490,"width":747,"height":12}},{"id":"2a02cb49-d637-4ba2-b500-5d1d74719798","block_type":"box","text":"invest in or extend credit to different parts of the capital structure of a single issuer. BlackRock may","page_number":203,"box":{"x":117,"y":506,"width":739,"height":12}},{"id":"ef503325-5bdb-4d9c-9066-2e663b648315","block_type":"box","text":"pursue rights, provide advice or engage in other activities, or refrain from pursuing rights, providing","page_number":203,"box":{"x":117,"y":521,"width":737,"height":12}},{"id":"376a51d7-93d1-4f58-8a5d-38068efd409c","block_type":"box","text":"advice or engaging in other activities, on behalf of other clients with respect to an issuer in which a","page_number":203,"box":{"x":116,"y":537,"width":735,"height":12}},{"id":"cd9f4c4d-ea6e-4b66-b87e-dcf7039ef956","block_type":"box","text":"Fund has invested, and such actions (or refraining from action) may have a material adverse effect on","page_number":203,"box":{"x":117,"y":552,"width":761,"height":12}},{"id":"bbc4da77-f55a-40ff-836a-cf6e3875356a","block_type":"box","text":"the Fund. In situations in which clients of BlackRock (including the Funds) hold positions in multiple","page_number":203,"box":{"x":116,"y":568,"width":740,"height":12}},{"id":"e6e15256-d8eb-42ff-8d12-8aa4c4024f90","block_type":"box","text":"parts of the capital structure of an issuer, BlackRock may not pursue certain actions or remedies that","page_number":203,"box":{"x":117,"y":583,"width":752,"height":12}},{"id":"e866869a-3529-49c0-b1d5-2fce371a75cc","block_type":"box","text":"may be available to a Fund, as a result of legal and regulatory requirements or otherwise. BlackRock","page_number":203,"box":{"x":117,"y":599,"width":752,"height":12}},{"id":"a511ba9a-fecd-4809-961e-41f04c0afc5f","block_type":"box","text":"addresses these and other potential conflicts of interest based on the facts and circumstances of","page_number":203,"box":{"x":116,"y":614,"width":722,"height":12}},{"id":"1f01b5e8-c459-4a87-bf7c-f41af0a56837","block_type":"box","text":"particular situations. For example, BlackRock may determine to rely on information barriers between","page_number":203,"box":{"x":117,"y":630,"width":748,"height":12}},{"id":"ffaa24c6-9861-47c2-b371-2618a13b3bc5","block_type":"box","text":"different business units or portfolio management teams. BlackRock may also determine to rely on the","page_number":203,"box":{"x":116,"y":645,"width":757,"height":12}},{"id":"c0e29b2b-7550-4103-8c78-4374bd15e855","block_type":"box","text":"actions of similarly situated holders of loans or securities rather than, or in connection with, taking such","page_number":203,"box":{"x":116,"y":661,"width":762,"height":12}},{"id":"ffb06a0b-bcda-446b-8ff8-a558a2d66636","block_type":"box","text":"actions itself on behalf of the Funds.","page_number":203,"box":{"x":116,"y":676,"width":268,"height":10}},{"id":"4f97681a-0165-4635-81de-d209d72fec59","block_type":"box","text":"In addition, to the extent permitted by applicable law, certain Funds may invest their assets in other","page_number":203,"box":{"x":117,"y":707,"width":734,"height":12}},{"id":"57e66035-1289-4475-9fb9-dd868ce5f7ae","block_type":"box","text":"funds advised by BlackRock, including funds that are managed by one or more of the same portfolio","page_number":203,"box":{"x":116,"y":723,"width":743,"height":12}},{"id":"57afe77a-4002-4906-a67b-286bcbb99d37","block_type":"box","text":"managers, which could result in conflicts of interest relating to asset allocation, timing of Fund","page_number":203,"box":{"x":117,"y":738,"width":693,"height":12}},{"id":"c796fbe8-6650-48e5-a8d9-d972d0b80bd8","block_type":"box","text":"purchases and redemptions, and increased remuneration and profitability for BlackRock and/or its","page_number":203,"box":{"x":117,"y":754,"width":725,"height":12}},{"id":"b8b35dc9-b195-4cd6-b4d5-29743e0bb1c6","block_type":"box","text":"personnel, including portfolio managers.","page_number":203,"box":{"x":117,"y":769,"width":295,"height":12}},{"id":"314348d0-bf99-4069-b79f-dc4816ae49ad","block_type":"box","text":"Third parties, including service providers to BlackRock or the Fund, may sponsor events (including, but","page_number":203,"box":{"x":116,"y":800,"width":764,"height":12}},{"id":"63e38367-1180-4348-8c93-912cbf24118a","block_type":"box","text":"not limited to, marketing and promotional activities and presentations, educational training programs","page_number":203,"box":{"x":117,"y":816,"width":741,"height":12}},{"id":"2a79c444-c1b0-40ae-8028-5a8068d20c7e","block_type":"box","text":"and conferences) for registered representatives, other professionals and individual investors. There is","page_number":203,"box":{"x":116,"y":831,"width":759,"height":12}},{"id":"cbe85f5a-8be3-4b37-8a58-a25c02f744ac","block_type":"box","text":"a potential conflict of interest as such sponsorships may defray the costs of such activities to","page_number":203,"box":{"x":116,"y":847,"width":691,"height":12}},{"id":"6c1a033c-211f-40aa-adee-20fc4c82527e","block_type":"box","text":"BlackRock, and may provide an incentive to BlackRock to retain such third parties to provide services","page_number":203,"box":{"x":117,"y":862,"width":757,"height":12}},{"id":"aa448de5-c9eb-4ce8-bd00-2d305a30b4e3","block_type":"box","text":"to the Fund.","page_number":203,"box":{"x":116,"y":878,"width":94,"height":9}},{"id":"4afc0c2f-32c4-4bce-b1c0-2f3fa7836431","block_type":"box","text":"II-116","page_number":203,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"bd30c258-08dd-4b38-848d-e04b9823e71a","block_type":"box","text":"NM1026U-6004382-203/605","page_number":203,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"26dc98db-f74c-4e15-8f93-90fef17a7613","block_type":"box","text":"In certain circumstances, BlackRock, on behalf of the Funds, may seek to buy from or sell securities to","page_number":204,"box":{"x":117,"y":87,"width":765,"height":12}},{"id":"1f1e3cb9-aafb-4842-b865-69e7d4abf318","block_type":"box","text":"another fund or account advised by BlackRock. BlackRock may (but is not required to) effect","page_number":204,"box":{"x":116,"y":102,"width":692,"height":13}},{"id":"117c3258-d5c0-4e7f-a453-ae10b069053b","block_type":"box","text":"purchases and sales between BlackRock clients (“cross trades”), including the Funds, if BlackRock","page_number":204,"box":{"x":117,"y":118,"width":739,"height":12}},{"id":"b3cdccc7-f4ad-4ed7-b4bb-36b5a2b910a9","block_type":"box","text":"believes such transactions are appropriate based on each party’s investment objectives and","page_number":204,"box":{"x":117,"y":134,"width":687,"height":12}},{"id":"0ce434e7-9a80-4f4f-99d5-613964625af4","block_type":"box","text":"guidelines, subject to applicable law and regulation. There may be potential conflicts of interest or","page_number":204,"box":{"x":116,"y":149,"width":728,"height":12}},{"id":"c9ea2789-7d4e-4a9b-a960-020054ea1f98","block_type":"box","text":"regulatory issues relating to these transactions which could limit BlackRock’s decision to engage in","page_number":204,"box":{"x":117,"y":165,"width":738,"height":12}},{"id":"fccc1af3-f9b5-4993-9d33-1db01f9505d6","block_type":"box","text":"these transactions for the Funds. BlackRock may have a potentially conflicting division of loyalties and","page_number":204,"box":{"x":116,"y":180,"width":763,"height":12}},{"id":"e0862514-413c-42a9-a7e6-3b2c1fcdbd7c","block_type":"box","text":"responsibilities to the parties in such transactions.","page_number":204,"box":{"x":117,"y":196,"width":374,"height":11}},{"id":"318ec583-2c78-4e9f-a391-8722d29a85dc","block_type":"box","text":"BlackRock and its clients may pursue or enforce rights with respect to an issuer in which a Fund has","page_number":204,"box":{"x":117,"y":227,"width":749,"height":12}},{"id":"b9a3944b-f9f7-4a0b-aa5d-dc64e97828d8","block_type":"box","text":"invested, and those activities may have an adverse effect on the Fund. As a result, prices, availability,","page_number":204,"box":{"x":117,"y":242,"width":760,"height":12}},{"id":"9631d90e-7fc2-4412-b3f1-b4ec861903d4","block_type":"box","text":"liquidity and terms of the Fund’s investments may be negatively impacted by the activities of","page_number":204,"box":{"x":117,"y":258,"width":687,"height":12}},{"id":"977c2785-c935-4c0e-8f89-21270e8311f5","block_type":"box","text":"BlackRock or its clients, and transactions for the Fund may be impaired or effected at prices or terms","page_number":204,"box":{"x":117,"y":273,"width":753,"height":12}},{"id":"3cc44858-fa80-4764-8d0d-3f50a9531753","block_type":"box","text":"that may be less favorable than would otherwise have been the case.","page_number":204,"box":{"x":116,"y":289,"width":520,"height":12}},{"id":"f5106a12-3c8a-41a6-b6d0-334c19f21745","block_type":"box","text":"The results of a Fund’s investment activities may differ significantly from the results achieved by","page_number":204,"box":{"x":116,"y":320,"width":716,"height":12}},{"id":"1eb16c3c-5e39-43c8-b7ea-06f4dc9c751d","block_type":"box","text":"BlackRock for its proprietary accounts or other accounts (including investment companies or collective","page_number":204,"box":{"x":117,"y":335,"width":763,"height":12}},{"id":"8a2689ff-e960-4bd3-9cc9-067687d4ff63","block_type":"box","text":"investment vehicles) that it manages or advises. It is possible that one or more accounts managed or","page_number":204,"box":{"x":117,"y":351,"width":754,"height":12}},{"id":"5f998a98-725d-403f-b9ce-100493473050","block_type":"box","text":"advised by BlackRock and such other accounts will achieve investment results that are substantially","page_number":204,"box":{"x":116,"y":366,"width":747,"height":12}},{"id":"1d9cf415-055a-4567-8de9-41dbe7d159fd","block_type":"box","text":"more or less favorable than the results achieved by a Fund. Moreover, it is possible that a Fund will","page_number":204,"box":{"x":117,"y":382,"width":741,"height":12}},{"id":"ba908456-bb63-4eea-96f1-f42c759b8961","block_type":"box","text":"sustain losses during periods in which one or more proprietary or other accounts managed or advised","page_number":204,"box":{"x":116,"y":397,"width":759,"height":12}},{"id":"bdda499c-6056-4ffd-8140-3221a9fc28f4","block_type":"box","text":"by BlackRock achieve significant profits. The opposite result is also possible.","page_number":204,"box":{"x":117,"y":413,"width":574,"height":12}},{"id":"6c208d61-916a-4ae3-b35a-795fc692bc84","block_type":"box","text":"From time to time, a Fund may be restricted from purchasing or selling securities, or from engaging in","page_number":204,"box":{"x":117,"y":444,"width":758,"height":12}},{"id":"b8578bc4-0530-475d-b921-6b30c73af538","block_type":"box","text":"other investment activities because of regulatory, legal or contractual requirements applicable to","page_number":204,"box":{"x":116,"y":459,"width":718,"height":12}},{"id":"ecd599fb-3573-4111-8661-2b135e84eb2e","block_type":"box","text":"BlackRock or other accounts managed or advised by BlackRock, and/or the internal policies of","page_number":204,"box":{"x":117,"y":475,"width":706,"height":12}},{"id":"b0cf41c0-3fb3-4817-9875-dc75450df56e","block_type":"box","text":"BlackRock designed to comply with such requirements. As a result, there may be periods, for example,","page_number":204,"box":{"x":117,"y":490,"width":769,"height":12}},{"id":"37dda9b0-c6e2-43b8-bd77-bf3cfc2509da","block_type":"box","text":"when BlackRock will not initiate or recommend certain types of transactions regarding certain","page_number":204,"box":{"x":116,"y":506,"width":697,"height":12}},{"id":"75aa3688-0306-4785-bb79-b6d941977c43","block_type":"box","text":"securities or instruments with respect to which BlackRock is performing services or when position limits","page_number":204,"box":{"x":116,"y":521,"width":771,"height":12}},{"id":"f6abf8fb-12a9-4b5f-a2a2-63b8796cb74b","block_type":"box","text":"have been reached. For example, the investment activities of BlackRock for its proprietary accounts","page_number":204,"box":{"x":117,"y":537,"width":745,"height":12}},{"id":"a93333f2-7ed3-4dd1-878b-b0c9f5a48b0c","block_type":"box","text":"and accounts under its management may limit the investment opportunities for a Fund in certain","page_number":204,"box":{"x":116,"y":552,"width":717,"height":12}},{"id":"2443e43f-6199-435a-a45b-1254cdf6377a","block_type":"box","text":"emerging and other markets in which limitations are imposed upon the amount of investment, in the","page_number":204,"box":{"x":116,"y":568,"width":744,"height":12}},{"id":"a49cf129-7997-475b-b252-a52aca9e9636","block_type":"box","text":"aggregate or in individual issuers, by affiliated foreign investors.","page_number":204,"box":{"x":116,"y":583,"width":478,"height":12}},{"id":"e68f1a46-2388-401f-93b2-8924c566c813","block_type":"box","text":"In connection with its management of a Fund, BlackRock may have access to certain fundamental","page_number":204,"box":{"x":117,"y":614,"width":733,"height":12}},{"id":"2448ff63-baea-4d03-86f8-aa1a24fa295b","block_type":"box","text":"analysis and proprietary technical models developed by BlackRock. BlackRock will not be under any","page_number":204,"box":{"x":116,"y":630,"width":750,"height":12}},{"id":"6e99c4eb-79ea-4388-8915-2e56d6142241","block_type":"box","text":"obligation, however, to effect transactions on behalf of a Fund in accordance with such analysis and","page_number":204,"box":{"x":116,"y":645,"width":746,"height":12}},{"id":"dbe3dba4-8d7f-4089-81b1-afa28a7b8b19","block_type":"box","text":"models. In addition, BlackRock will not have any obligation to make available any information regarding","page_number":204,"box":{"x":117,"y":661,"width":764,"height":12}},{"id":"75494638-dc16-4621-9dd7-4d7e2259a0a1","block_type":"box","text":"its proprietary activities or strategies, or the activities or strategies used for other accounts managed by","page_number":204,"box":{"x":117,"y":676,"width":764,"height":12}},{"id":"d5ed32f1-0687-4f17-a458-bd7c43eb7e56","block_type":"box","text":"them, for the benefit of the management of a Fund and it is not anticipated that BlackRock will have","page_number":204,"box":{"x":116,"y":692,"width":738,"height":12}},{"id":"175f620e-7934-484b-a8a3-df46f4cf6ac8","block_type":"box","text":"access to such information for the purpose of managing the Fund. The proprietary activities or portfolio","page_number":204,"box":{"x":116,"y":707,"width":762,"height":12}},{"id":"2559522a-5238-4b37-bf62-ddfbb68334d6","block_type":"box","text":"strategies of BlackRock, or the activities or strategies used for accounts managed by BlackRock or","page_number":204,"box":{"x":116,"y":723,"width":734,"height":12}},{"id":"bbffc3e2-d0b5-44ab-a20f-4ebf0ac3c56a","block_type":"box","text":"other client accounts could conflict with the transactions and strategies employed by BlackRock in","page_number":204,"box":{"x":116,"y":738,"width":725,"height":12}},{"id":"ff814880-d7f2-4b69-9bca-a54d82a8ab2e","block_type":"box","text":"managing a Fund.","page_number":204,"box":{"x":117,"y":754,"width":133,"height":12}},{"id":"1e9b6b88-ba14-4697-a9c5-2b42740db175","block_type":"box","text":"The Funds may be included in investment models developed by BlackRock for use by clients and","page_number":204,"box":{"x":116,"y":785,"width":722,"height":12}},{"id":"d9345398-d9ae-4134-9fa2-3f7091bc64f0","block_type":"box","text":"financial advisors. To the extent clients invest in these investment models and increase the assets","page_number":204,"box":{"x":116,"y":800,"width":728,"height":10}},{"id":"b99b1ce5-4b0b-4f67-bfbf-8c8bd6c98ff5","block_type":"box","text":"under management of the Funds, the investment management fee amounts paid by the Funds to","page_number":204,"box":{"x":117,"y":816,"width":719,"height":12}},{"id":"3851971f-c319-41dd-a964-d128005928fd","block_type":"box","text":"BlackRock may also increase. The net asset value and liquidity of a Fund may be impacted by","page_number":204,"box":{"x":117,"y":831,"width":704,"height":12}},{"id":"4199269c-8ad0-4394-9bfe-d85b0e7c013c","block_type":"box","text":"purchases and sales of the Fund by model-driven investment portfolios, as well as by BlackRock itself","page_number":204,"box":{"x":117,"y":847,"width":760,"height":12}},{"id":"bd07ba0a-cbef-4a3e-aaa4-b68a16cfac23","block_type":"box","text":"and by its advisory clients.","page_number":204,"box":{"x":116,"y":862,"width":201,"height":12}},{"id":"4eaaca1c-3e58-45c2-b8ab-76afc2650f33","block_type":"box","text":"II-117","page_number":204,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"87ca904f-5180-4303-8c6c-005be2ad14f4","block_type":"box","text":"NM1026U-6004382-204/605","page_number":204,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"e386e115-f896-4ed3-88ab-961ae327151e","block_type":"box","text":"In addition, certain principals and certain employees of a Fund’s investment adviser are also principals","page_number":205,"box":{"x":117,"y":87,"width":764,"height":12}},{"id":"f29492bc-f8d5-4622-84cc-e4ede3f83c58","block_type":"box","text":"or employees of other business units or entities within BlackRock. As a result, these principals and","page_number":205,"box":{"x":116,"y":102,"width":736,"height":13}},{"id":"b5fd34bd-9ee4-4bc6-b376-726e1cdf1590","block_type":"box","text":"employees may have obligations to such other business units or entities or their clients and such","page_number":205,"box":{"x":116,"y":118,"width":722,"height":12}},{"id":"9c3cd84d-6f61-4692-9eb3-f8a67e4ef73f","block_type":"box","text":"obligations to other business units or entities or their clients may be a consideration of which investors","page_number":205,"box":{"x":116,"y":134,"width":762,"height":12}},{"id":"61479220-ba38-4542-90f0-234ad7610c5a","block_type":"box","text":"in a Fund should be aware.","page_number":205,"box":{"x":117,"y":149,"width":206,"height":10}},{"id":"3bc7f974-b7f1-4032-a5ae-9d05b3e10b65","block_type":"box","text":"BlackRock may enter into transactions and invest in securities, instruments and currencies on behalf of","page_number":205,"box":{"x":117,"y":180,"width":769,"height":12}},{"id":"9b1d1108-ca46-403f-9db3-6dd1018afdac","block_type":"box","text":"a Fund in which clients of BlackRock, or, to the extent permitted by the Commission and applicable","page_number":205,"box":{"x":116,"y":196,"width":740,"height":12}},{"id":"d93e0b63-4ac6-4471-8636-99a8afbcb06b","block_type":"box","text":"law, BlackRock, serves as the counterparty, principal or issuer. In such cases, such party’s interests in","page_number":205,"box":{"x":117,"y":211,"width":764,"height":12}},{"id":"7cb941bb-08fb-445d-aeb5-e9020cd15500","block_type":"box","text":"the transaction will be adverse to the interests of the Fund, and such party may have no incentive to","page_number":205,"box":{"x":116,"y":227,"width":747,"height":12}},{"id":"c229a67a-6ce1-4604-bfb9-d494be10ba82","block_type":"box","text":"assure that the Fund obtains the best possible prices or terms in connection with the transactions. In","page_number":205,"box":{"x":116,"y":242,"width":750,"height":12}},{"id":"e2b07a18-22ef-44d9-8400-dd5f0cb52cc9","block_type":"box","text":"addition, the purchase, holding and sale of such investments by a Fund may enhance the profitability","page_number":205,"box":{"x":116,"y":258,"width":754,"height":12}},{"id":"266eb622-02d2-4484-a768-3f2d7da9a896","block_type":"box","text":"of BlackRock.","page_number":205,"box":{"x":116,"y":273,"width":107,"height":10}},{"id":"d1dffb95-b3a1-46cd-bcb9-608639959ee3","block_type":"box","text":"BlackRock may also create, write or issue derivatives for clients, the underlying securities, currencies","page_number":205,"box":{"x":117,"y":304,"width":755,"height":12}},{"id":"35032bd9-2e7c-444c-86be-9027ea01524e","block_type":"box","text":"or instruments of which may be those in which a Fund invests or which may be based on the","page_number":205,"box":{"x":116,"y":320,"width":692,"height":12}},{"id":"c48ada5b-4774-4c48-8cfb-ab2e8ce35823","block_type":"box","text":"performance of the Fund. Additionally, an affiliate of BlackRock will create, write or issue options,","page_number":205,"box":{"x":117,"y":335,"width":724,"height":12}},{"id":"8af971dc-cc6d-4ee9-8766-677a01c2798e","block_type":"box","text":"which may be based on the performance of certain Funds. BlackRock has entered into an arrangement","page_number":205,"box":{"x":116,"y":351,"width":772,"height":12}},{"id":"beffc1a5-6e64-4e12-9fac-4c2240d8526e","block_type":"box","text":"with Markit Indices Limited, the index provider for underlying fixed-income indexes used by certain","page_number":205,"box":{"x":116,"y":366,"width":733,"height":12}},{"id":"ce018b7a-c1aa-47b5-8ff3-09a4f99a6c0c","block_type":"box","text":"iShares ETFs, related to derivative fixed-income products that are based on such iShares ETFs.","page_number":205,"box":{"x":117,"y":382,"width":718,"height":12}},{"id":"43a86a7d-146e-4a86-b40d-13427ed59e40","block_type":"box","text":"Trading activity in these derivative products could also potentially lead to greater liquidity for such","page_number":205,"box":{"x":116,"y":397,"width":727,"height":12}},{"id":"ee188839-68e3-4f90-aa85-eb277a4b54ee","block_type":"box","text":"products, increased purchase activity with respect to these iShares ETFs and increased assets under","page_number":205,"box":{"x":117,"y":413,"width":758,"height":12}},{"id":"3f097c6b-a4c1-4428-8c69-974e4f6b25bd","block_type":"box","text":"management for BlackRock.","page_number":205,"box":{"x":117,"y":428,"width":215,"height":12}},{"id":"ed869b0b-3aea-4dac-9091-0fd89774e6d8","block_type":"box","text":"A Fund may, subject to applicable law, purchase investments that are the subject of an underwriting or","page_number":205,"box":{"x":116,"y":459,"width":766,"height":12}},{"id":"11bbaa62-ca40-4ecf-a0ec-aaa70e0d939e","block_type":"box","text":"other distribution by BlackRock and may also enter into transactions with other clients of BlackRock","page_number":205,"box":{"x":116,"y":475,"width":744,"height":12}},{"id":"4010618d-fb2d-40cf-8d12-f3c2fdd73da2","block_type":"box","text":"where such other clients have interests adverse to those of the Fund. At times, these activities may","page_number":205,"box":{"x":116,"y":490,"width":741,"height":12}},{"id":"f9114728-93f1-4a50-aa5b-bf45fcd450ed","block_type":"box","text":"cause business units or entities within BlackRock to give advice to clients that may cause these clients","page_number":205,"box":{"x":116,"y":506,"width":766,"height":12}},{"id":"137b7b16-9f90-41cc-83fe-8fecca167e34","block_type":"box","text":"to take actions adverse to the interests of the Fund. To the extent such transactions are permitted, a","page_number":205,"box":{"x":116,"y":521,"width":749,"height":12}},{"id":"d5abef93-f012-4b90-a2e8-e2abf2b66c41","block_type":"box","text":"Fund will deal with BlackRock on an arms-length basis.","page_number":205,"box":{"x":117,"y":537,"width":414,"height":12}},{"id":"d68c340e-d9ea-48ea-a86c-6249b5f42a5a","block_type":"box","text":"To the extent authorized by applicable law, BlackRock may act as broker, dealer, agent, lender or","page_number":205,"box":{"x":116,"y":568,"width":729,"height":12}},{"id":"4752c7a7-e356-4fb2-a189-2f075d3a15c1","block_type":"box","text":"adviser or in other commercial capacities for a Fund. 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Index based","page_number":205,"box":{"x":117,"y":661,"width":740,"height":12}},{"id":"77c0c9c1-a3f2-445a-aed1-ef26e332a7d2","block_type":"box","text":"funds may use an index provider that is affiliated with another service provider of the Fund or","page_number":205,"box":{"x":116,"y":676,"width":690,"height":12}},{"id":"c049fbdd-7f73-49e7-bcb9-aa48bd504afa","block_type":"box","text":"BlackRock that acts as a broker, dealer, agent, lender or in other commercial capacities for a Fund or","page_number":205,"box":{"x":117,"y":692,"width":751,"height":12}},{"id":"53027f03-10f4-49b8-b9c1-fddae419d042","block_type":"box","text":"BlackRock.","page_number":205,"box":{"x":117,"y":707,"width":81,"height":10}},{"id":"15ba45f7-978c-4960-a96a-eee68fd90937","block_type":"box","text":"Subject to applicable law, BlackRock (and its personnel and other distributors) will be entitled to retain","page_number":205,"box":{"x":116,"y":738,"width":755,"height":12}},{"id":"5876c28b-7b14-42f9-b592-b2e7079d352b","block_type":"box","text":"fees and other amounts that they receive in connection with their service to the Funds as broker,","page_number":205,"box":{"x":116,"y":754,"width":715,"height":12}},{"id":"22258cdb-3fe1-48e1-9dfb-361de6dec2e8","block_type":"box","text":"dealer, agent, lender, adviser or in other commercial capacities. No accounting to the Funds or their","page_number":205,"box":{"x":116,"y":769,"width":741,"height":12}},{"id":"64761854-19e8-40b6-a96c-1f808596ad43","block_type":"box","text":"shareholders will be required, and no fees or other compensation payable by the Funds or their","page_number":205,"box":{"x":116,"y":785,"width":707,"height":12}},{"id":"967406d1-f504-48ed-8492-e1f5efb63cbd","block_type":"box","text":"shareholders will be reduced by reason of receipt by BlackRock of any such fees or other amounts.","page_number":205,"box":{"x":116,"y":800,"width":735,"height":12}},{"id":"864675a7-9b43-4083-9e60-f1b33b1477a6","block_type":"box","text":"When BlackRock acts as broker, dealer, agent, adviser or in other commercial capacities in relation to","page_number":205,"box":{"x":116,"y":831,"width":761,"height":12}},{"id":"ff441269-8c1c-4c15-86d2-d372ae878050","block_type":"box","text":"the Funds, BlackRock may take commercial steps in its own interests, which may have an adverse","page_number":205,"box":{"x":116,"y":847,"width":738,"height":12}},{"id":"b3eab9ad-002e-410a-be0c-bf876dddbae4","block_type":"box","text":"effect on the Funds.","page_number":205,"box":{"x":116,"y":862,"width":153,"height":10}},{"id":"e3992f1e-2a44-4baa-b270-6c658d04d2c0","block_type":"box","text":"II-118","page_number":205,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"c4f15d30-efa6-4a43-bddd-82e37c80ee8a","block_type":"box","text":"NM1026U-6004382-205/605","page_number":205,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ea6bb2ad-b611-4dbf-b3de-b4a262b5c463","block_type":"box","text":"A Fund will be required to establish business relationships with its counterparties based on the Fund’s","page_number":206,"box":{"x":116,"y":87,"width":761,"height":12}},{"id":"8f54e5b5-5519-46ba-a057-90707aae6bce","block_type":"box","text":"own credit standing. BlackRock will not have any obligation to allow its credit to be used in connection","page_number":206,"box":{"x":116,"y":103,"width":760,"height":12}},{"id":"3f08ed6d-2986-4a9b-a777-829e1757499a","block_type":"box","text":"with a Fund’s establishment of its business relationships, nor is it expected that the Fund’s","page_number":206,"box":{"x":116,"y":118,"width":675,"height":12}},{"id":"6a98a5f4-3fa6-470b-9c57-95dcde668a33","block_type":"box","text":"counterparties will rely on the credit of BlackRock in evaluating the Fund’s creditworthiness.","page_number":206,"box":{"x":116,"y":134,"width":684,"height":12}},{"id":"482ae299-6f08-45d7-a8eb-60740378504b","block_type":"box","text":"BlackRock Investment Management, LLC (“BIM”) or BlackRock Institutional Trust Company, N.A.","page_number":206,"box":{"x":117,"y":165,"width":726,"height":12}},{"id":"be10fc40-de5d-4141-af33-a588ec5caeb1","block_type":"box","text":"(“BTC”), as applicable, each an affiliate of BlackRock, pursuant to SEC exemptive relief, acts as","page_number":206,"box":{"x":117,"y":180,"width":715,"height":12}},{"id":"b92559e4-1b39-4012-bd6d-30bc1ed4a04d","block_type":"box","text":"securities lending agent to, and receives a share of securities lending revenues from, the Funds.","page_number":206,"box":{"x":116,"y":196,"width":720,"height":12}},{"id":"4d485daa-d0ed-42b6-ab86-02c61005f8da","block_type":"box","text":"BlackRock will also receive compensation for managing the reinvestment of the cash collateral from","page_number":206,"box":{"x":117,"y":211,"width":744,"height":12}},{"id":"0ac9e152-bc4b-4973-846e-3738a0e2dfc0","block_type":"box","text":"securities lending. There are potential conflicts of interests in managing a securities lending program,","page_number":206,"box":{"x":116,"y":227,"width":755,"height":12}},{"id":"96cd5191-094b-40fb-b2e7-e1018af6ac44","block_type":"box","text":"including but not limited to: (i) BlackRock as securities lending agent may have an incentive to, among","page_number":206,"box":{"x":117,"y":242,"width":762,"height":12}},{"id":"3fdc92c4-ab63-483d-9222-fc8679f9b8b5","block_type":"box","text":"other things, increase or decrease the amount of securities on loan or to lend particular securities in","page_number":206,"box":{"x":116,"y":258,"width":745,"height":12}},{"id":"d89173f7-b47c-4107-a4ce-5406845923b8","block_type":"box","text":"order to generate additional risk-adjusted revenue for BlackRock and its affiliates; and (ii) BlackRock","page_number":206,"box":{"x":116,"y":273,"width":750,"height":12}},{"id":"b8d47b87-f593-4de1-81cf-5ecc783bd71a","block_type":"box","text":"as securities lending agent may have an incentive to allocate loans to clients that would provide more","page_number":206,"box":{"x":116,"y":289,"width":757,"height":12}},{"id":"9c5ac3cf-b7b5-4abe-961b-0789a3f36fd3","block_type":"box","text":"revenue to BlackRock. As described further below, BlackRock seeks to mitigate this conflict by","page_number":206,"box":{"x":117,"y":304,"width":706,"height":12}},{"id":"119f97a2-92d8-4429-83d1-b76a7e3496c2","block_type":"box","text":"providing its securities lending clients with equal lending opportunities over time in order to","page_number":206,"box":{"x":117,"y":320,"width":675,"height":12}},{"id":"8bb4c5cd-c03b-4423-83f7-5abe2b1867cf","block_type":"box","text":"approximate pro rata allocation.","page_number":206,"box":{"x":116,"y":335,"width":240,"height":12}},{"id":"fcc7005e-fcf1-4307-9fd1-b2e7c47dfc02","block_type":"box","text":"As part of its securities lending program, BlackRock indemnifies the Funds and certain other clients","page_number":206,"box":{"x":116,"y":366,"width":742,"height":12}},{"id":"4d4b46ce-a77d-4616-ae00-ac9b57318bb4","block_type":"box","text":"and/or funds against a shortfall in collateral in the event of borrower default. On a regular basis,","page_number":206,"box":{"x":116,"y":382,"width":713,"height":12}},{"id":"d6c7007d-d5ec-4630-8d2d-1495fa79b932","block_type":"box","text":"BlackRock calculates the potential dollar exposure of collateral shortfall resulting from a borrower","page_number":206,"box":{"x":117,"y":397,"width":725,"height":12}},{"id":"43104635-5662-4913-b5cd-a3d67c98489f","block_type":"box","text":"default (“shortfall risk”) in the securities lending program. BlackRock establishes program-wide","page_number":206,"box":{"x":116,"y":413,"width":705,"height":12}},{"id":"abded759-26be-4116-91d5-fc1b5c0ba215","block_type":"box","text":"borrower limits (“credit limits”) to actively manage borrower-specific credit exposure. BlackRock","page_number":206,"box":{"x":117,"y":428,"width":711,"height":12}},{"id":"8046924a-519a-488f-ac00-3e04d73a3a92","block_type":"box","text":"oversees the risk model that calculates projected collateral shortfall values using loan-level factors","page_number":206,"box":{"x":116,"y":444,"width":734,"height":12}},{"id":"6c1cc30b-344a-4c63-a2de-c8622be8425b","block_type":"box","text":"such as loan and collateral type and market value as well as specific borrower credit characteristics.","page_number":206,"box":{"x":116,"y":459,"width":747,"height":12}},{"id":"ced8ec20-7d1e-4044-935e-b2611cc594b9","block_type":"box","text":"When necessary, BlackRock may adjust securities lending program attributes by restricting eligible","page_number":206,"box":{"x":116,"y":475,"width":738,"height":12}},{"id":"2e2d95ef-ef08-4f25-a3a3-876322e06bd3","block_type":"box","text":"collateral or reducing borrower credit limits. As a result, the management of program-wide exposure as","page_number":206,"box":{"x":116,"y":490,"width":768,"height":12}},{"id":"6eda58c9-5ed7-437f-9491-0138a10f9762","block_type":"box","text":"well as BlackRock-specific indemnification exposure may affect the amount of securities lending","page_number":206,"box":{"x":116,"y":506,"width":717,"height":12}},{"id":"5b09f24e-7165-45bb-8555-f73a835bc003","block_type":"box","text":"activity BlackRock may conduct at any given point in time by reducing the volume of lending","page_number":206,"box":{"x":116,"y":521,"width":687,"height":12}},{"id":"64e2c596-4d55-4aca-961a-c691d69f17bf","block_type":"box","text":"opportunities for certain loans (including by asset type, collateral type and/or revenue profile).","page_number":206,"box":{"x":116,"y":537,"width":698,"height":12}},{"id":"a051295c-5023-4290-805c-ae185396c305","block_type":"box","text":"BlackRock may decline to make a securities loan on behalf of a Fund, discontinue lending on behalf of","page_number":206,"box":{"x":117,"y":568,"width":764,"height":12}},{"id":"32863f81-3b8d-4078-a68b-3c8777643674","block_type":"box","text":"a Fund or terminate a securities loan on behalf of a Fund for any reason, including but not limited to","page_number":206,"box":{"x":116,"y":583,"width":744,"height":12}},{"id":"b40c6cd8-b99a-4132-8a81-e01cad13d93b","block_type":"box","text":"regulatory requirements and/or market rules, liquidity considerations, or credit considerations, which","page_number":206,"box":{"x":117,"y":599,"width":745,"height":12}},{"id":"8bd7a3d6-9cff-476a-8290-b4f8d55f0130","block_type":"box","text":"may impact Funds by reducing or eliminating the volume of lending opportunities for certain types of","page_number":206,"box":{"x":117,"y":614,"width":746,"height":12}},{"id":"50fe5514-20bc-4206-8ec5-c2cfbd464c7e","block_type":"box","text":"loans, loans in particular markets, loans of particular securities or types of securities, or for loans","page_number":206,"box":{"x":117,"y":630,"width":720,"height":12}},{"id":"232aefaf-7cd0-4278-bf6d-1f716b320f7c","block_type":"box","text":"overall. In addition, some borrowers may prefer certain BlackRock lenders that provide additional","page_number":206,"box":{"x":116,"y":645,"width":725,"height":12}},{"id":"782382fc-8137-4351-a1a3-33c564ca974e","block_type":"box","text":"protections against lender default that are favored by their prudential regulation.","page_number":206,"box":{"x":117,"y":661,"width":590,"height":12}},{"id":"97396f9f-ff18-4896-91ad-69717ccd1aea","block_type":"box","text":"BlackRock uses a predetermined systematic process in order to approximate pro rata allocation over","page_number":206,"box":{"x":117,"y":692,"width":747,"height":12}},{"id":"70fee19f-2ece-40ed-82ee-4dbdd6bfb639","block_type":"box","text":"time. In order to allocate a loan to a portfolio: (i) BlackRock as a whole must have sufficient lending","page_number":206,"box":{"x":116,"y":707,"width":733,"height":12}},{"id":"e0124adb-176d-4b1f-a2ba-d27a844bde0f","block_type":"box","text":"capacity pursuant to the various program limits (i.e. indemnification exposure limit and borrower credit","page_number":206,"box":{"x":116,"y":723,"width":756,"height":12}},{"id":"e8455bc0-94e2-4a15-85d5-04c03eafbe29","block_type":"box","text":"limits); (ii) the lending portfolio must hold the asset at the time a loan opportunity arrives; and (iii) the","page_number":206,"box":{"x":117,"y":738,"width":742,"height":12}},{"id":"050f4d3f-bac1-4cce-9b80-81fb6e000386","block_type":"box","text":"lending portfolio must also have enough inventory, either on its own or when aggregated with other","page_number":206,"box":{"x":117,"y":754,"width":733,"height":12}},{"id":"9cfd35c4-22c5-4fad-b8f4-dc3432a110bd","block_type":"box","text":"portfolios into one single market delivery, to satisfy the loan request. In doing so, BlackRock seeks to","page_number":206,"box":{"x":117,"y":769,"width":748,"height":12}},{"id":"b755f57e-cab1-4181-971e-12506813e640","block_type":"box","text":"provide equal lending opportunities for all portfolios, independent of whether BlackRock indemnifies the","page_number":206,"box":{"x":117,"y":785,"width":765,"height":12}},{"id":"7047168e-249b-4f0d-8f4e-2504aed6ba80","block_type":"box","text":"portfolio. Equal opportunities for lending portfolios does not guarantee equal outcomes. Specifically,","page_number":206,"box":{"x":117,"y":800,"width":738,"height":12}},{"id":"d9184552-72f2-44b5-b69c-001a58c0def4","block_type":"box","text":"short and long-term outcomes for individual clients may vary due to asset mix, asset/liability spreads","page_number":206,"box":{"x":116,"y":816,"width":744,"height":12}},{"id":"0330f086-d9b3-4700-8c3c-23f343cf0d2a","block_type":"box","text":"on different securities, and the overall limits imposed by the firm.","page_number":206,"box":{"x":116,"y":831,"width":483,"height":12}},{"id":"a79942dc-f22d-4531-afce-286cec53b211","block_type":"box","text":"Purchases and sales of securities and other assets for a Fund may be aggregated with orders for other","page_number":206,"box":{"x":117,"y":862,"width":769,"height":12}},{"id":"8d97aa95-c67e-4487-ae4e-f24b24ff98f8","block_type":"box","text":"BlackRock client accounts, including with accounts that pay different transaction costs solely due to the","page_number":206,"box":{"x":117,"y":878,"width":770,"height":12}},{"id":"a91c1f2e-4902-4f70-9d05-af5fb87b3d93","block_type":"box","text":"II-119","page_number":206,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"a1aa818a-f2fc-4288-b64d-8bbf78d90a37","block_type":"box","text":"NM1026U-6004382-206/605","page_number":206,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9c9bd759-4539-452e-8d89-3514fac233ec","block_type":"box","text":"fact that they have different research payment arrangements. BlackRock, however, is not required to","page_number":207,"box":{"x":116,"y":87,"width":752,"height":12}},{"id":"a6b4c31f-aa5e-43b3-b0d9-0ff8a53a8a01","block_type":"box","text":"aggregate orders if portfolio management decisions for different accounts are made separately, or if","page_number":207,"box":{"x":116,"y":102,"width":746,"height":13}},{"id":"cf0c2f26-1864-4644-a9da-32281c8c3e89","block_type":"box","text":"they determine that aggregating is not practicable or required, or in cases involving client direction.","page_number":207,"box":{"x":116,"y":118,"width":737,"height":12}},{"id":"d32c3636-d1f7-4d8f-b11e-ca77b2950bb1","block_type":"box","text":"Prevailing trading activity frequently may make impossible the receipt of the same price or execution","page_number":207,"box":{"x":117,"y":146,"width":748,"height":12}},{"id":"4639f5e4-3836-4e9f-8a52-1c607b44c49c","block_type":"box","text":"on the entire volume of securities purchased or sold. When this occurs, the various prices may be","page_number":207,"box":{"x":116,"y":162,"width":730,"height":12}},{"id":"7fa5bf2a-8e65-4165-82b8-824adb065961","block_type":"box","text":"averaged, and the Funds will be charged or credited with the average price. Thus, the effect of the","page_number":207,"box":{"x":116,"y":177,"width":734,"height":12}},{"id":"3c6616b8-0851-4e19-b0d6-4a6404295f21","block_type":"box","text":"aggregation may operate on some occasions to the disadvantage of the Funds. In addition, under","page_number":207,"box":{"x":116,"y":193,"width":730,"height":12}},{"id":"e168eca6-c9d7-46f6-a7e0-5ad1608500b6","block_type":"box","text":"certain circumstances, the Funds will not be charged the same commission or commission equivalent","page_number":207,"box":{"x":116,"y":209,"width":759,"height":11}},{"id":"22d5e5e8-d2b1-4c41-9fd6-294982b1c4ab","block_type":"box","text":"rates in connection with an aggregated order.","page_number":207,"box":{"x":117,"y":224,"width":341,"height":12}},{"id":"ae7eed84-145f-41e7-b911-4dfce1fce4fc","block_type":"box","text":"As discussed in the section below entitled “Portfolio Transactions and Brokerage — Transactions in","page_number":207,"box":{"x":116,"y":252,"width":743,"height":12}},{"id":"5ff70408-fccf-4951-8545-56398a72e201","block_type":"box","text":"Portfolio Securities,” BlackRock, unless prohibited by applicable law, may cause a Fund or account to","page_number":207,"box":{"x":117,"y":268,"width":757,"height":12}},{"id":"48b1fc10-d15e-418c-a5e6-5918182082bb","block_type":"box","text":"pay a broker or dealer a commission for effecting a transaction that exceeds the amount another","page_number":207,"box":{"x":117,"y":283,"width":720,"height":12}},{"id":"00f6b60f-cf34-4710-9a48-15b40719a8f8","block_type":"box","text":"broker or dealer would have charged for effecting the same transaction in recognition of the value of","page_number":207,"box":{"x":117,"y":299,"width":746,"height":12}},{"id":"14475b8a-beed-4167-9c2e-ce6dfe9077f3","block_type":"box","text":"brokerage and research services provided by that broker or dealer. Under MiFID II, EU investment","page_number":207,"box":{"x":117,"y":314,"width":734,"height":12}},{"id":"2fa68067-0131-4da7-ac5b-83efe99fb501","block_type":"box","text":"managers, including BlackRock International Limited (“BIL”) which acts as a sub-adviser to certain","page_number":207,"box":{"x":117,"y":330,"width":732,"height":12}},{"id":"2be17dab-7719-4be8-aa74-c641e31d2673","block_type":"box","text":"Funds, pay for research from brokers and dealers directly out of their own resources, rather than","page_number":207,"box":{"x":117,"y":345,"width":721,"height":12}},{"id":"f10bdbe7-0f7a-47cc-b1ac-bf2a1ac69b1e","block_type":"box","text":"through client commissions.","page_number":207,"box":{"x":116,"y":361,"width":212,"height":12}},{"id":"8aacbc2b-3ea3-41c3-b969-bc41c10a9937","block_type":"box","text":"Subject to applicable law, BlackRock may select brokers that furnish BlackRock, the Funds, other","page_number":207,"box":{"x":116,"y":389,"width":728,"height":12}},{"id":"5dd0f3a8-2ad5-4034-a2e5-5bf6708baecc","block_type":"box","text":"BlackRock client accounts or personnel, directly or through correspondent relationships, with research","page_number":207,"box":{"x":117,"y":405,"width":762,"height":12}},{"id":"4c3302d9-0bc2-4aaa-b25e-b0ef6abad3eb","block_type":"box","text":"or other appropriate services which provide, in BlackRock’s view, appropriate assistance to BlackRock","page_number":207,"box":{"x":116,"y":420,"width":765,"height":12}},{"id":"5095d31f-0e09-4849-a552-2c0cfcbb977e","block_type":"box","text":"in the investment decision-making process (including with respect to futures, fixed-price offerings and","page_number":207,"box":{"x":117,"y":436,"width":756,"height":12}},{"id":"f345689b-a264-4efc-8fbc-43b67d1ebd11","block_type":"box","text":"OTC transactions). Such research or other services may include, to the extent permitted by law,","page_number":207,"box":{"x":116,"y":451,"width":717,"height":12}},{"id":"af9ac986-b926-4782-abca-81fbf91ade9e","block_type":"box","text":"research reports on companies, industries and securities; economic and financial data; financial","page_number":207,"box":{"x":117,"y":467,"width":714,"height":12}},{"id":"6e8aabf1-5740-45dd-b12b-63311964882c","block_type":"box","text":"publications; proxy analysis; trade industry seminars; computer data bases; research-oriented software","page_number":207,"box":{"x":117,"y":482,"width":769,"height":12}},{"id":"1eb03dde-89ab-4104-90c5-7a6ac4d1212b","block_type":"box","text":"and other services and products.","page_number":207,"box":{"x":116,"y":498,"width":249,"height":12}},{"id":"e9c0da06-6744-4b80-9180-ac36c2ef1d99","block_type":"box","text":"Research or other services obtained in this manner may be used in servicing any or all of the Funds","page_number":207,"box":{"x":117,"y":526,"width":745,"height":12}},{"id":"2a02dd86-f198-4d69-ab4d-89538b808913","block_type":"box","text":"and other BlackRock client accounts, including in connection with BlackRock client accounts other than","page_number":207,"box":{"x":116,"y":542,"width":770,"height":12}},{"id":"13d7949b-5858-44cd-bf48-a91e0aab64e5","block_type":"box","text":"those that pay commissions to the broker relating to the research or other service arrangements. Such","page_number":207,"box":{"x":116,"y":557,"width":766,"height":12}},{"id":"d4c6e51e-aa59-43fc-885e-ad29a68c1bbb","block_type":"box","text":"products and services may disproportionately benefit other BlackRock client accounts relative to the","page_number":207,"box":{"x":117,"y":573,"width":745,"height":12}},{"id":"1d2e8519-970b-49e1-a75b-6793aae9e2dd","block_type":"box","text":"Funds based on the amount of brokerage commissions paid by the Funds and such other BlackRock","page_number":207,"box":{"x":117,"y":588,"width":753,"height":12}},{"id":"3a0c0f92-658e-48c0-99ec-528f4518d007","block_type":"box","text":"client accounts. For example, research or other services that are paid for through one client’s","page_number":207,"box":{"x":116,"y":604,"width":696,"height":12}},{"id":"3e06a7da-3908-4fd6-8b75-99f215fb9cdf","block_type":"box","text":"commissions may not be used in managing that client’s account. In addition, other BlackRock client","page_number":207,"box":{"x":116,"y":619,"width":743,"height":12}},{"id":"e039f210-884a-4e90-b726-f3e9a56aaac3","block_type":"box","text":"accounts may receive the benefit, including disproportionate benefits, of economies of scale or price","page_number":207,"box":{"x":116,"y":635,"width":748,"height":12}},{"id":"77e78795-6b73-4f35-948f-02504c6c24df","block_type":"box","text":"discounts in connection with products and services that may be provided to the Funds and to such","page_number":207,"box":{"x":116,"y":650,"width":734,"height":12}},{"id":"1ce35d96-29e5-42e0-9e32-02f912c9b98a","block_type":"box","text":"other BlackRock client accounts. To the extent that BlackRock uses soft dollars, it will not have to pay","page_number":207,"box":{"x":116,"y":666,"width":755,"height":12}},{"id":"de98f787-881e-4765-a516-cd0cd37e1865","block_type":"box","text":"for those products and services itself.","page_number":207,"box":{"x":116,"y":681,"width":276,"height":12}},{"id":"af79cbac-31ba-40c7-81f0-162870f59946","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may endeavor to execute trades through brokers who,","page_number":207,"box":{"x":117,"y":710,"width":759,"height":12}},{"id":"005dae06-76ac-40ad-beeb-bc7b34291499","block_type":"box","text":"pursuant to such arrangements, provide research or other services in order to ensure the continued","page_number":207,"box":{"x":117,"y":725,"width":737,"height":12}},{"id":"f0faae85-aabd-4293-966e-c5fc31023de7","block_type":"box","text":"receipt of research or other services BlackRock believes are useful in its investment decision-making","page_number":207,"box":{"x":117,"y":740,"width":747,"height":13}},{"id":"acfa3930-dcce-403f-885f-e5a0c9d131a0","block_type":"box","text":"process. BlackRock may from time to time choose not to engage in the above described arrangements","page_number":207,"box":{"x":117,"y":756,"width":762,"height":12}},{"id":"bca9a4e8-9a11-42cd-8acc-268277bcbc90","block_type":"box","text":"to varying degrees. BlackRock, unless prohibited by applicable law, may also enter into commission","page_number":207,"box":{"x":116,"y":772,"width":740,"height":12}},{"id":"a1f9f84f-a44d-46ae-85df-e0e72b7ae1cf","block_type":"box","text":"sharing arrangements under which BlackRock may execute transactions through a broker-dealer and","page_number":207,"box":{"x":116,"y":787,"width":751,"height":12}},{"id":"a50269e8-a458-4340-8ea1-a7b7b76bca1a","block_type":"box","text":"request that the broker-dealer allocate a portion of the commissions or commission credits to another","page_number":207,"box":{"x":117,"y":802,"width":750,"height":12}},{"id":"ffac7da0-e64c-45d5-aadc-9be89d9eba95","block_type":"box","text":"firm that provides research to BlackRock. To the extent that BlackRock engages in commission sharing","page_number":207,"box":{"x":116,"y":818,"width":766,"height":12}},{"id":"f18f910a-c681-4f23-8eca-f48c2b561551","block_type":"box","text":"arrangements, many of the same conflicts related to traditional soft dollars may exist.","page_number":207,"box":{"x":116,"y":833,"width":636,"height":13}},{"id":"56ac545d-69f8-4a4d-b2e6-d0a2305ae3b7","block_type":"box","text":"BlackRock may utilize certain electronic crossing networks (“ECNs”) (including, without limitation,","page_number":207,"box":{"x":117,"y":862,"width":724,"height":12}},{"id":"2702776b-eac2-441c-9b0d-8cc790384ac2","block_type":"box","text":"ECNs in which BlackRock has an investment or other interest, to the extent permitted by applicable","page_number":207,"box":{"x":117,"y":877,"width":741,"height":12}},{"id":"bbf4ba93-b6fe-45d9-9c53-5271c57acb55","block_type":"box","text":"II-120","page_number":207,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"41238dee-52c5-4730-b538-53fce3caf005","block_type":"box","text":"NM1026U-6004382-207/605","page_number":207,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"7cdc9ee3-b6a2-4635-a1dc-2ad5e72c71bb","block_type":"box","text":"law) in executing client securities transactions for certain types of securities. These ECNs may charge","page_number":208,"box":{"x":117,"y":87,"width":760,"height":12}},{"id":"80a118df-e064-4de4-81b5-a89131a4ab4d","block_type":"box","text":"fees for their services, including access fees and transaction fees. The transaction fees, which are","page_number":208,"box":{"x":116,"y":102,"width":733,"height":13}},{"id":"a96db6b2-8318-4adf-b787-dd53792bfeed","block_type":"box","text":"similar to commissions or markups/markdowns, will generally be charged to clients and, like","page_number":208,"box":{"x":116,"y":118,"width":686,"height":12}},{"id":"f83d32d7-6804-4689-858b-ddd1867c0ac5","block_type":"box","text":"commissions and markups/markdowns, would generally be included in the cost of the securities","page_number":208,"box":{"x":116,"y":134,"width":715,"height":12}},{"id":"6cac2b6c-a870-434f-8a97-5ab7ec7eb289","block_type":"box","text":"purchased. Access fees may be paid by BlackRock even though incurred in connection with executing","page_number":208,"box":{"x":117,"y":149,"width":763,"height":12}},{"id":"b791e364-ae7c-40d6-ab5c-73a68090d38f","block_type":"box","text":"transactions on behalf of clients, including the Funds. In certain circumstances, ECNs may offer","page_number":208,"box":{"x":116,"y":165,"width":715,"height":12}},{"id":"e36981a6-6158-47b4-ae37-5645a9009017","block_type":"box","text":"volume discounts that will reduce the access fees typically paid by BlackRock. BlackRock will only","page_number":208,"box":{"x":116,"y":180,"width":733,"height":12}},{"id":"0b9787e7-769c-4a47-bc7f-259c661d5275","block_type":"box","text":"utilize ECNs consistent with its obligation to seek to obtain best execution in client transactions.","page_number":208,"box":{"x":117,"y":196,"width":711,"height":12}},{"id":"7b492e80-31a6-4aa3-908c-7dce6357305b","block_type":"box","text":"BlackRock owns a minority interest in, and is a member of, Members Exchange (“MEMX”), a newly","page_number":208,"box":{"x":117,"y":227,"width":739,"height":12}},{"id":"d20ad6a0-08d0-462d-b6a6-393734aa157c","block_type":"box","text":"created U.S. stock exchange. Transactions for a Fund may be executed on MEMX if third party brokers","page_number":208,"box":{"x":116,"y":242,"width":772,"height":12}},{"id":"eaa65ecd-7399-4b95-a573-d99f697a58b4","block_type":"box","text":"select MEMX as the appropriate venue for execution of orders placed by BlackRock traders on behalf","page_number":208,"box":{"x":116,"y":258,"width":759,"height":12}},{"id":"3996e5c5-031a-4dc7-8806-7d55faef97d1","block_type":"box","text":"of client portfolios.","page_number":208,"box":{"x":116,"y":273,"width":140,"height":12}},{"id":"a9821d8a-2028-4744-aa5d-da2224e717c7","block_type":"box","text":"BlackRock has adopted policies and procedures designed to prevent conflicts of interest from","page_number":208,"box":{"x":117,"y":304,"width":697,"height":12}},{"id":"56347f2a-0e1f-41bc-a2ce-9154e541275d","block_type":"box","text":"influencing proxy voting decisions that it makes on behalf of advisory clients, including the Funds, and","page_number":208,"box":{"x":117,"y":320,"width":759,"height":12}},{"id":"bd15b964-3879-41bf-a83a-bdc29ce1cccb","block_type":"box","text":"to help ensure that such decisions are made in accordance with BlackRock’s fiduciary obligations to its","page_number":208,"box":{"x":116,"y":335,"width":768,"height":12}},{"id":"be8514b7-9767-490a-8727-f461cc843446","block_type":"box","text":"clients. Nevertheless, notwithstanding such proxy voting policies and procedures, actual proxy voting","page_number":208,"box":{"x":116,"y":351,"width":754,"height":12}},{"id":"26e43ae0-cc60-472c-9b29-1e8e3612ae55","block_type":"box","text":"decisions of BlackRock may have the effect of favoring the interests of other clients or businesses of","page_number":208,"box":{"x":116,"y":366,"width":750,"height":12}},{"id":"91b6c94b-9c74-42c7-88b6-c8c5adc05d70","block_type":"box","text":"other divisions or units of BlackRock, provided that BlackRock believes such voting decisions to be in","page_number":208,"box":{"x":116,"y":382,"width":756,"height":12}},{"id":"db3d2840-e8ff-48e5-af56-5db381e7f31d","block_type":"box","text":"accordance with its fiduciary obligations. For a more detailed discussion of these policies and","page_number":208,"box":{"x":116,"y":397,"width":696,"height":12}},{"id":"fa545fdc-6403-4c10-bdc4-d44582865a64","block_type":"box","text":"procedures, see “Proxy Voting Policies and Procedures.”","page_number":208,"box":{"x":117,"y":413,"width":426,"height":12}},{"id":"2c7d6fe7-fc0d-49d1-a203-0e46b8a35b8e","block_type":"box","text":"It is also possible that, from time to time, BlackRock and/or its advisory clients (including other funds","page_number":208,"box":{"x":117,"y":444,"width":747,"height":12}},{"id":"77b194b6-2252-4b12-a538-e502a7c92285","block_type":"box","text":"and separately managed accounts) may, subject to compliance with applicable law, purchase and hold","page_number":208,"box":{"x":116,"y":459,"width":768,"height":12}},{"id":"70806d86-9791-4ec6-919d-e01aee581dd6","block_type":"box","text":"shares of a Fund. Increasing a Fund’s assets may enhance investment flexibility and diversification","page_number":208,"box":{"x":116,"y":475,"width":740,"height":12}},{"id":"783bcdc0-2d31-42e5-ab00-47c76ff4188b","block_type":"box","text":"and may contribute to economies of scale that tend to reduce the Fund’s expense ratio. BlackRock","page_number":208,"box":{"x":116,"y":490,"width":738,"height":12}},{"id":"2279d759-9e75-4466-8b5f-a9c40ed06314","block_type":"box","text":"reserves the right, subject to compliance with applicable law, to redeem at any time some or all of the","page_number":208,"box":{"x":117,"y":506,"width":756,"height":12}},{"id":"a2d8a78f-bc70-45ef-b8d7-a3697f49d382","block_type":"box","text":"shares of a Fund acquired for its own accounts. A large redemption of shares of a Fund by BlackRock","page_number":208,"box":{"x":116,"y":521,"width":762,"height":12}},{"id":"18634755-0b46-47dc-b8a5-dafbd8c9e303","block_type":"box","text":"could significantly reduce the asset size of the Fund, which might have an adverse effect on the Fund’s","page_number":208,"box":{"x":116,"y":537,"width":770,"height":12}},{"id":"848932f4-f16e-409c-aff0-e534d0edbc0e","block_type":"box","text":"investment flexibility, portfolio diversification and expense ratio. BlackRock seeks to consider the effect","page_number":208,"box":{"x":117,"y":552,"width":766,"height":12}},{"id":"4a913712-4b28-4520-a60e-170d65927014","block_type":"box","text":"of redemptions on a Fund and other shareholders in deciding whether to redeem its shares but is not","page_number":208,"box":{"x":116,"y":568,"width":754,"height":12}},{"id":"34b4147a-7fba-4ca0-ba0e-f075c4834d02","block_type":"box","text":"obligated to do so and may elect not to do so.","page_number":208,"box":{"x":116,"y":583,"width":344,"height":12}},{"id":"78265b61-ef36-4f17-8e0d-c66dd30bfd18","block_type":"box","text":"It is possible that a Fund may invest in securities of, or engage in transactions with, companies in","page_number":208,"box":{"x":117,"y":614,"width":725,"height":12}},{"id":"e5088408-101f-4b10-a475-0a2617bdc223","block_type":"box","text":"which BlackRock has significant debt or equity investments or other interests. A Fund may also invest","page_number":208,"box":{"x":116,"y":630,"width":759,"height":12}},{"id":"6a78a7cf-4265-4ac8-bb4e-cd05cbf51b87","block_type":"box","text":"in issuances (such as structured notes) by entities for which BlackRock provides and is compensated","page_number":208,"box":{"x":117,"y":645,"width":756,"height":12}},{"id":"658528d1-fbd5-4353-9817-c39824e20db0","block_type":"box","text":"for cash management services relating to the proceeds from the sale of such issuances. In making","page_number":208,"box":{"x":116,"y":661,"width":732,"height":12}},{"id":"cb9bb7d0-6632-492b-bfe8-2180c3b25d0f","block_type":"box","text":"investment decisions for a Fund, BlackRock is not permitted to obtain or use material non-public","page_number":208,"box":{"x":117,"y":676,"width":713,"height":12}},{"id":"65ad7d56-d39f-4176-924c-35931ba6aa58","block_type":"box","text":"information acquired by any unit of BlackRock, in the course of these activities. In addition, from time to","page_number":208,"box":{"x":117,"y":692,"width":765,"height":12}},{"id":"9dc9b2d6-3d32-43f0-98a6-ee5ccddfcbc2","block_type":"box","text":"time, the activities of BlackRock may limit a Fund’s flexibility in purchases and sales of securities. As","page_number":208,"box":{"x":116,"y":707,"width":745,"height":12}},{"id":"b700b9b0-6b73-4594-ba2c-9cd114a85b38","block_type":"box","text":"indicated below, BlackRock may engage in transactions with companies in which BlackRock-advised","page_number":208,"box":{"x":117,"y":723,"width":747,"height":12}},{"id":"9f8a108d-9a66-4c42-8351-abfeed8921d7","block_type":"box","text":"funds or other clients of BlackRock have an investment.","page_number":208,"box":{"x":116,"y":738,"width":413,"height":10}},{"id":"43de888c-2ade-49ab-a56c-df1744ab2450","block_type":"box","text":"BlackRock and its personnel and other financial service providers may have interests in promoting","page_number":208,"box":{"x":117,"y":769,"width":727,"height":12}},{"id":"5839b08a-6a50-442d-8bc7-c8ca52debfb5","block_type":"box","text":"sales of the Funds. With respect to BlackRock and its personnel, the remuneration and profitability","page_number":208,"box":{"x":116,"y":785,"width":730,"height":12}},{"id":"7cb51fbd-6740-4426-8a11-e2a7216d61c5","block_type":"box","text":"relating to services to and sales of the Funds or other products may be greater than remuneration and","page_number":208,"box":{"x":117,"y":800,"width":756,"height":12}},{"id":"ac552c5c-6881-463b-b0ba-6d1fae13d54d","block_type":"box","text":"profitability relating to services to and sales of certain funds or other products that might be provided or","page_number":208,"box":{"x":117,"y":816,"width":763,"height":12}},{"id":"23047780-3e1c-4e05-9dad-d4511b1d3edf","block_type":"box","text":"offered. BlackRock and its sales personnel may directly or indirectly receive a portion of the fees and","page_number":208,"box":{"x":116,"y":831,"width":753,"height":12}},{"id":"cc117899-127c-4205-8590-74f1546ee1fa","block_type":"box","text":"commissions charged to the Funds or their shareholders. BlackRock and its advisory or other","page_number":208,"box":{"x":116,"y":847,"width":698,"height":12}},{"id":"a4681c42-b1ee-4869-a223-494ba30d1d71","block_type":"box","text":"personnel may also benefit from increased amounts of assets under management. Fees and","page_number":208,"box":{"x":117,"y":862,"width":692,"height":12}},{"id":"9b2eec88-39fc-4375-9a0b-22ef5bc1fdbd","block_type":"box","text":"commissions may also be higher than for other products or services, and the remuneration and","page_number":208,"box":{"x":116,"y":878,"width":711,"height":12}},{"id":"858d195e-f990-4cde-b2e2-0825aec583d0","block_type":"box","text":"II-121","page_number":208,"box":{"x":480,"y":909,"width":38,"height":9}},{"id":"7f135ed3-6a63-401a-91b2-e0244d8c1a48","block_type":"box","text":"NM1026U-6004382-208/605","page_number":208,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"01ce4d9f-4337-4f95-b5c4-12a05b33a2b6","block_type":"box","text":"profitability to BlackRock and such personnel resulting from transactions on behalf of or management","page_number":209,"box":{"x":117,"y":87,"width":756,"height":12}},{"id":"0a207c0f-da62-4c37-8b8b-d693952582aa","block_type":"box","text":"of the Funds may be greater than the remuneration and profitability resulting from other funds or","page_number":209,"box":{"x":116,"y":102,"width":719,"height":13}},{"id":"bbc4cd2c-95ac-4080-982d-59fccde6252b","block_type":"box","text":"products.","page_number":209,"box":{"x":117,"y":118,"width":73,"height":12}},{"id":"a747a34b-3666-4f51-9981-8fda9b5754b9","block_type":"box","text":"BlackRock may provide valuation assistance to certain clients with respect to certain securities or other","page_number":209,"box":{"x":117,"y":149,"width":769,"height":12}},{"id":"074cc169-d02d-482d-beec-c85ce4b41012","block_type":"box","text":"investments and the valuation recommendations made for such clients’ accounts may differ from the","page_number":209,"box":{"x":117,"y":165,"width":749,"height":12}},{"id":"735dfea4-030f-451e-a0c2-a9ec121a0dab","block_type":"box","text":"valuations for the same securities or investments assigned by a Fund’s pricing vendors, especially if","page_number":209,"box":{"x":116,"y":180,"width":747,"height":12}},{"id":"8a5c4d49-2539-49bc-8e08-26c568dc5a65","block_type":"box","text":"such valuations are based on broker-dealer quotes or other data sources unavailable to the Fund’s","page_number":209,"box":{"x":116,"y":196,"width":739,"height":11}},{"id":"e00da3cc-c3af-4c56-b61b-2f644b840e9c","block_type":"box","text":"pricing vendors. While BlackRock will generally communicate its valuation information or","page_number":209,"box":{"x":117,"y":211,"width":660,"height":12}},{"id":"83ef3338-65c5-4069-bf3b-c482f03f6afc","block_type":"box","text":"determinations to a Fund’s pricing vendors and/or fund accountants, there may be instances where the","page_number":209,"box":{"x":116,"y":227,"width":769,"height":12}},{"id":"71c6186d-24ef-4c12-80e1-929ec26f7604","block_type":"box","text":"Fund’s pricing vendors or fund accountants assign a different valuation to a security or other","page_number":209,"box":{"x":117,"y":242,"width":688,"height":12}},{"id":"45103199-737d-4289-b6d2-07019e4a7b24","block_type":"box","text":"investment than the valuation for such security or investment determined or recommended by","page_number":209,"box":{"x":117,"y":258,"width":699,"height":12}},{"id":"0b93b5ef-e6cd-46fe-bb11-2882d3f48448","block_type":"box","text":"BlackRock.","page_number":209,"box":{"x":117,"y":273,"width":88,"height":10}},{"id":"fdaff370-950b-4960-93c2-843e32d8e3c5","block_type":"box","text":"As disclosed in more detail in “Pricing of Shares—Determination of Net Asset Value” in this SAI, when","page_number":209,"box":{"x":116,"y":304,"width":762,"height":12}},{"id":"7031c89a-f9bb-4ee3-9c55-3f2c7526ecf2","block_type":"box","text":"market quotations are not readily available or are believed by BlackRock to be unreliable, a Fund’s","page_number":209,"box":{"x":117,"y":320,"width":736,"height":12}},{"id":"ca455999-d2e7-454a-b1c0-4f2f6b64abbb","block_type":"box","text":"investments are valued at fair value by BlackRock. BlackRock has been designated as the Fund’s","page_number":209,"box":{"x":117,"y":335,"width":730,"height":12}},{"id":"31e1d5eb-d869-476d-9f94-f0cc6a8052a2","block_type":"box","text":"valuation designee pursuant to Rule 2a-5 under the Investment Company Act and acts through","page_number":209,"box":{"x":116,"y":351,"width":710,"height":12}},{"id":"91babf31-d6ec-4c4c-a2d1-0ed1af45e1a2","block_type":"box","text":"BlackRock’s Rule 2a-5 Committee (the “2a-5 Committee”), with assistance from other BlackRock","page_number":209,"box":{"x":117,"y":366,"width":723,"height":12}},{"id":"a4989b00-893f-41d5-b011-7ece17b2f211","block_type":"box","text":"pricing committees and in accordance with BlackRock’s policies and procedures (the “Valuation","page_number":209,"box":{"x":117,"y":382,"width":713,"height":12}},{"id":"c0bff8b8-044c-401c-ba1e-ed3cef04a27a","block_type":"box","text":"Procedures”). When determining a “fair value price,” the 2a-5 Committee seeks to determine the price","page_number":209,"box":{"x":117,"y":397,"width":760,"height":12}},{"id":"3faae48a-fd5f-4bf5-97af-bca2a1aa3d27","block_type":"box","text":"that a Fund might reasonably expect to receive from the current sale of that asset or liability in an","page_number":209,"box":{"x":116,"y":413,"width":726,"height":12}},{"id":"799d07c9-46ac-4d6d-bdec-5c82dabe172f","block_type":"box","text":"arm’s-length transaction. The price generally may not be determined based on what a Fund might","page_number":209,"box":{"x":116,"y":428,"width":730,"height":12}},{"id":"006ed76d-4cc0-4af4-9058-2002cb48a3c8","block_type":"box","text":"reasonably expect to receive for selling an asset or liability at a later time or if it holds the asset or","page_number":209,"box":{"x":117,"y":444,"width":728,"height":12}},{"id":"3e939bcb-377d-4a96-9928-0a79f17586b8","block_type":"box","text":"liability to maturity. While fair value determinations will be based upon all available factors that","page_number":209,"box":{"x":117,"y":459,"width":701,"height":12}},{"id":"df174183-f66e-464e-bf96-9b5c7eb6b98d","block_type":"box","text":"BlackRock deems relevant at the time of the determination, and may be based on analytical values","page_number":209,"box":{"x":117,"y":475,"width":739,"height":12}},{"id":"f52a052b-7e8a-4511-b8bc-7688070247e3","block_type":"box","text":"determined by BlackRock using proprietary or third party valuation models, fair value represents only a","page_number":209,"box":{"x":116,"y":490,"width":767,"height":12}},{"id":"e95674ba-8795-48d8-9d16-25f9e958f85e","block_type":"box","text":"good faith approximation of the value of an asset or liability. 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BlackRock may adopt certain controls designed to prevent","page_number":212,"box":{"x":117,"y":180,"width":767,"height":12}},{"id":"d2ad28c7-8143-475c-8b59-a3982357c5df","block_type":"box","text":"the occurrence of a breach of any applicable ownership threshold or limits, including, for example,","page_number":212,"box":{"x":116,"y":196,"width":731,"height":12}},{"id":"1c028147-db94-49ec-b4a4-4e05d6cd03d7","block_type":"box","text":"when ownership in certain securities nears an applicable threshold, BlackRock may limit additional","page_number":212,"box":{"x":116,"y":211,"width":736,"height":12}},{"id":"01a24675-2d77-4432-90c6-ff9d6023d5a5","block_type":"box","text":"purchases in such securities or, with respect to ETFs, remove such securities from the list of Deposit","page_number":212,"box":{"x":117,"y":227,"width":751,"height":11}},{"id":"29d32615-8cf6-49d8-a971-3bc96a58c903","block_type":"box","text":"Securities to be delivered to the Fund in connection with purchases of Creation Units of such Fund. 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To t","page_number":212,"box":{"x":117,"y":481,"width":346,"height":12}},{"id":"fe5e52c5-9b80-4b02-ae37-278389955144","block_type":"box","text":"he extent permitted by applicable laws, the Funds may","page_number":212,"box":{"x":464,"y":481,"width":401,"height":12}},{"id":"623911ec-2ee8-4c42-9e87-f281586bff38","block_type":"box","text":"seek to license and use such indices as part of their investment strategy. Index based funds that seek to","page_number":212,"box":{"x":116,"y":496,"width":762,"height":12}},{"id":"b7aca02b-d2d1-4171-9959-2cfdcce55980","block_type":"box","text":"track the performance of securities indices also may us","page_number":212,"box":{"x":116,"y":512,"width":400,"height":12}},{"id":"e43558f6-041f-436e-94f2-0ff7afb3bd3f","block_type":"box","text":"e the name of the index or index provider in the","page_number":212,"box":{"x":517,"y":512,"width":348,"height":12}},{"id":"1d7c0e1f-4dba-47f6-83dd-be15225c58d0","block_type":"box","text":"fund name. Index providers, including BlackRock (to","page_number":212,"box":{"x":116,"y":527,"width":384,"height":12}},{"id":"5fdc0217-e06e-46d3-932f-78c27496a622","block_type":"box","text":"the extent permitted by applicable law), may be paid","page_number":212,"box":{"x":500,"y":527,"width":384,"height":12}},{"id":"e1fc169f-65ab-4e77-bc82-c12c26ddbb4b","block_type":"box","text":"licensing fees for use of their index or index nam","page_number":212,"box":{"x":117,"y":543,"width":351,"height":12}},{"id":"b708a2f3-8f4b-4187-8294-7f0777a1ee41","block_type":"box","text":"e. 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BlackRock ma","page_number":212,"box":{"x":116,"y":574,"width":382,"height":12}},{"id":"7c813dd7-7831-4244-a61a-fa6ef5e88b05","block_type":"box","text":"y benefit from the Funds using BlackRock indices by","page_number":212,"box":{"x":498,"y":574,"width":386,"height":12}},{"id":"89e0377c-0a15-48c3-afd6-2b2fca121293","block_type":"box","text":"creating increasing acceptance in the marketplace for","page_number":212,"box":{"x":116,"y":589,"width":394,"height":12}},{"id":"06aff2ce-878f-4abe-a052-204f20633af0","block_type":"box","text":"such indices. BlackRock is not obligated to license","page_number":212,"box":{"x":510,"y":589,"width":371,"height":12}},{"id":"d1f99a45-2daf-486f-8c9c-c68d61c5111a","block_type":"box","text":"its indices to a Fund and the Funds are under no obli","page_number":212,"box":{"x":117,"y":605,"width":382,"height":9}},{"id":"724b43eb-3666-4ef5-a3e4-3c06c1d8b2c8","block_type":"box","text":"gation to use BlackRock indices. Any Fund that","page_number":212,"box":{"x":500,"y":605,"width":348,"height":12}},{"id":"948e862c-eaad-4414-8b19-c44d9366b238","block_type":"box","text":"enters into a license for a BlackRock index cannot be assured that the terms of any index licensing","page_number":212,"box":{"x":116,"y":620,"width":722,"height":12}},{"id":"e70961d8-3a7e-4712-ba75-6d2be48caefd","block_type":"box","text":"agreement with BlackRock will be as favorable as","page_number":212,"box":{"x":116,"y":636,"width":360,"height":12}},{"id":"b9ee5bec-1e98-4371-977d-ce082befb6fe","block_type":"box","text":"those terms offered to other licensees.","page_number":212,"box":{"x":477,"y":636,"width":289,"height":9}},{"id":"5cb26aa9-86c4-4db3-9463-c7b65d1cafca","block_type":"box","text":"BlackRock may enter into contractual arrangements wit","page_number":212,"box":{"x":117,"y":664,"width":401,"height":12}},{"id":"7aed37a6-a8f4-410b-808d-71c3de7849df","block_type":"box","text":"h third-party service providers to a Fund (e.g.,","page_number":212,"box":{"x":520,"y":664,"width":330,"height":12}},{"id":"bedd7580-646e-49f4-a0e5-6adb47190be5","block_type":"box","text":"custodians, administrators and index providers) purs","page_number":212,"box":{"x":116,"y":679,"width":381,"height":12}},{"id":"a8e6993d-7973-4d8e-935c-35adc84fc215","block_type":"box","text":"uant to which BlackRock receives fee discounts or","page_number":212,"box":{"x":498,"y":679,"width":365,"height":10}},{"id":"f1e89759-d0a1-4cf9-a545-f856a4d669f1","block_type":"box","text":"concessions in recognition of BlackRock’s overall relationship with such service providers. BlackRock","page_number":212,"box":{"x":116,"y":695,"width":736,"height":12}},{"id":"069a5567-300b-465d-98b9-ccae42a61ac2","block_type":"box","text":"may also enter into contractual arrangements with su","page_number":212,"box":{"x":117,"y":710,"width":384,"height":12}},{"id":"0ded5f27-c7ff-4acb-a13d-ceccfa3b9229","block_type":"box","text":"ch service providers pursuant to which BlackRock","page_number":212,"box":{"x":503,"y":710,"width":361,"height":12}},{"id":"93c402a2-6aaa-43ee-96c1-6a5300335684","block_type":"box","text":"incurs additional costs if the service provider’s","page_number":212,"box":{"x":117,"y":726,"width":332,"height":12}},{"id":"74270f47-dc61-4920-b7fd-a9776a6496ad","block_type":"box","text":"services are terminated with respect to a Fund. To the","page_number":212,"box":{"x":455,"y":726,"width":392,"height":12}},{"id":"963edcdf-a723-441e-8d03-7df62a24e530","block_type":"box","text":"extent that BlackRock is responsible for paying service","page_number":212,"box":{"x":116,"y":741,"width":397,"height":12}},{"id":"8e57eb5a-4db1-4e96-a067-8865893d1d4e","block_type":"box","text":"providers out of its fees that it receives from the","page_number":212,"box":{"x":519,"y":741,"width":344,"height":12}},{"id":"27df0a15-0bbe-4a57-b232-852a622b0ea5","block_type":"box","text":"Funds, the benefits of lower fees, including any fee di","page_number":212,"box":{"x":117,"y":757,"width":385,"height":12}},{"id":"26d492ed-f5c0-4647-a1a3-1d89a06d4489","block_type":"box","text":"scounts or concessions, or any additional savings,","page_number":212,"box":{"x":504,"y":757,"width":364,"height":12}},{"id":"4a7ded06-8497-45d6-b76d-14787c643447","block_type":"box","text":"may accrue, in whole or in part, to BlackRock, which coul","page_number":212,"box":{"x":117,"y":772,"width":413,"height":12}},{"id":"eb9ef32e-9fbf-448d-8006-880c667986e0","block_type":"box","text":"d result in conflicts of interest relating to the use","page_number":212,"box":{"x":531,"y":772,"width":346,"height":12}},{"id":"e9b64650-4b1c-4aa6-b586-e33e16a8e429","block_type":"box","text":"or termination of service providers to a Fund. In additi","page_number":212,"box":{"x":116,"y":788,"width":387,"height":12}},{"id":"dc26fd18-93cd-4ba5-9a2e-e6f178eca89d","block_type":"box","text":"on, conflicts of interest may arise with respect to","page_number":212,"box":{"x":505,"y":788,"width":349,"height":12}},{"id":"15f3b980-af46-4cb5-92db-9bfe9454f8df","block_type":"box","text":"contractual arrangements with third-party service provider","page_number":212,"box":{"x":116,"y":803,"width":420,"height":12}},{"id":"944f670d-34ed-4813-b95e-fa2d778bf033","block_type":"box","text":"s to a Fund, or the selection of such providers,","page_number":212,"box":{"x":536,"y":803,"width":336,"height":12}},{"id":"67b3c424-7aaa-494d-8bdd-6f9364f12d66","block_type":"box","text":"particularly in circumstances where BlackRock is","page_number":212,"box":{"x":117,"y":819,"width":353,"height":12}},{"id":"c93fa926-e0da-4243-a76e-64d1bd686db8","block_type":"box","text":"negotiating on behalf of both funds that have a unitary","page_number":212,"box":{"x":476,"y":819,"width":391,"height":12}},{"id":"75efcb4b-3d50-4863-a4b9-1383797e8876","block_type":"box","text":"management fee and those that do not","page_number":212,"box":{"x":117,"y":834,"width":287,"height":12}},{"id":"cec97899-98f3-4af3-914e-9f66315fc414","block_type":"box","text":"or different service providers have different fee structures.","page_number":212,"box":{"x":404,"y":834,"width":425,"height":12}},{"id":"bc8cd399-55a0-47ab-a4d4-2b1ed6ec5943","block_type":"box","text":"Conflicts of interest may arise as a result of simultaneous investment management of multiple client","page_number":212,"box":{"x":117,"y":862,"width":744,"height":12}},{"id":"49fcfcea-4fbc-42d6-9f79-00a3d9d402e0","block_type":"box","text":"accounts by BlackRock’s investment professionals. For example, differences in the advisory fee","page_number":212,"box":{"x":116,"y":878,"width":716,"height":12}},{"id":"314c4d18-1626-4994-8cf2-6cffad77acca","block_type":"box","text":"II-125","page_number":212,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"f8ee9975-5238-4397-9b0e-a13b09d07b74","block_type":"box","text":"NM1026U-6004382-212/605","page_number":212,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9f3af6fa-d31f-466f-8ca9-572e5ba2e0cf","block_type":"box","text":"structure may create the appearance of actual or potential conflicts of interest because such","page_number":213,"box":{"x":116,"y":87,"width":689,"height":12}},{"id":"3f0d733b-ca89-4118-a4ae-9d2e397381ee","block_type":"box","text":"differences could create pecuniary incentives for BlackRock to favor one client account over another.","page_number":213,"box":{"x":116,"y":102,"width":754,"height":13}},{"id":"95967c9f-6f1f-45a9-a822-f0c9e46b5a7f","block_type":"box","text":"BlackRock owns or has an ownership interest in certain trading, portfolio management, operations and/","page_number":213,"box":{"x":117,"y":134,"width":765,"height":12}},{"id":"25d3e2e9-6fba-42cd-a221-77d2ca4a913f","block_type":"box","text":"or information systems used by Fund service providers. These systems are, or will be, used by a Fund","page_number":213,"box":{"x":116,"y":149,"width":765,"height":12}},{"id":"6d565a89-8bce-4999-852f-a82bff853eb7","block_type":"box","text":"service provider in connection with the provision of services to accounts managed by BlackRock and","page_number":213,"box":{"x":116,"y":165,"width":752,"height":12}},{"id":"b0b76fd4-1429-4976-abcc-1d2f183eee15","block_type":"box","text":"funds managed and sponsored by BlackRock, including the Funds, that engage the service provider","page_number":213,"box":{"x":116,"y":180,"width":748,"height":12}},{"id":"c23b45b4-db96-4753-8a41-1ab9d3e3d0d9","block_type":"box","text":"(typically the custodian). A Fund’s service provider remunerates BlackRock for the use of the systems.","page_number":213,"box":{"x":117,"y":196,"width":764,"height":12}},{"id":"12840d9b-94c1-4df6-bd19-0adf97f2b1bd","block_type":"box","text":"A Fund service provider’s payments to BlackRock for the use of these systems may enhance the","page_number":213,"box":{"x":116,"y":211,"width":724,"height":12}},{"id":"ba52b84c-eda4-4e28-9892-52065a93f372","block_type":"box","text":"profitability of BlackRock.","page_number":213,"box":{"x":117,"y":227,"width":191,"height":12}},{"id":"04969516-22c6-4326-b540-e7b3261979e5","block_type":"box","text":"BlackRock’s receipt of fees from a service provider in connection with the use of systems provided by","page_number":213,"box":{"x":117,"y":258,"width":757,"height":12}},{"id":"fb615100-54db-4f81-bf5f-9f786da8f770","block_type":"box","text":"BlackRock may create an incentive for BlackRock to recommend that a Fund enter into or renew an","page_number":213,"box":{"x":117,"y":273,"width":745,"height":12}},{"id":"2829bcb9-8ad3-4a1d-85be-a13610b2db10","block_type":"box","text":"arrangement with the service provider.","page_number":213,"box":{"x":116,"y":289,"width":291,"height":12}},{"id":"faba8a98-fcdd-49cd-897f-fc6125674876","block_type":"box","text":"In recognition of a BlackRock client’s overall relationship with BlackRock, BlackRock may offer special","page_number":213,"box":{"x":117,"y":320,"width":762,"height":12}},{"id":"858aa9bd-025c-4024-802b-846554707104","block_type":"box","text":"pricing arrangements for certain services provided by BlackRock. Any such special pricing","page_number":213,"box":{"x":117,"y":335,"width":673,"height":12}},{"id":"a1647123-173c-4d91-8e29-2810d1d880b2","block_type":"box","text":"arrangements will not affect Fund fees and expenses applicable to such client’s investment in a Fund.","page_number":213,"box":{"x":116,"y":351,"width":760,"height":12}},{"id":"fd9224fb-d38a-4b00-9ac8-1026d01af760","block_type":"box","text":"Present and future activities of BlackRock and its directors, officers and employees, in addition to those","page_number":213,"box":{"x":117,"y":382,"width":771,"height":12}},{"id":"5b944f55-3cbe-4cc2-b392-bf66dd8ea274","block_type":"box","text":"described in this section, may give rise to additional conflicts of interest.","page_number":213,"box":{"x":116,"y":397,"width":537,"height":12}},{"id":"9aaf8f76-5ec2-4682-b32c-cfd4d73aaddd","block_type":"box","text":"P","page_number":213,"box":{"x":418,"y":444,"width":9,"height":9}},{"id":"dd2ab5a1-78c7-4ef5-9726-f2a949d44971","block_type":"box","text":"URCHASE","page_number":213,"box":{"x":429,"y":446,"width":65,"height":7}},{"id":"10d4df41-2329-43e9-859a-d7ea7bb728be","block_type":"box","text":"OF","page_number":213,"box":{"x":500,"y":446,"width":18,"height":7}},{"id":"e6357d94-8db8-481b-adc8-bcf165fd2df0","block_type":"box","text":"S","page_number":213,"box":{"x":519,"y":444,"width":15,"height":9}},{"id":"9142843e-9895-49e9-8468-f47c3208ad13","block_type":"box","text":"HARES","page_number":213,"box":{"x":536,"y":446,"width":46,"height":7}},{"id":"eee040e6-b27b-48f7-9e3b-472ca34d07f1","block_type":"box","text":"Most BlackRock-advised open-end funds offer multiple classes of shares under a plan adopted under","page_number":213,"box":{"x":117,"y":475,"width":756,"height":12}},{"id":"34fa6325-12cb-45bc-bf0e-98b371270ed6","block_type":"box","text":"Rule 18f-3 under the Investment Company Act. Investor A Shares are sold to investors choosing the","page_number":213,"box":{"x":117,"y":490,"width":748,"height":12}},{"id":"f6afc413-1086-4c7f-8946-eca006ae6b65","block_type":"box","text":"initial sales charge alternative, except that Investor A Shares of Index Funds (defined below) and","page_number":213,"box":{"x":117,"y":506,"width":723,"height":12}},{"id":"78302649-5eca-414f-8987-6f98765c83c2","block_type":"box","text":"BlackRock Short Obligations Fund are generally not subject to an initial sales charge, and Investor C","page_number":213,"box":{"x":117,"y":521,"width":752,"height":12}},{"id":"cb2bd017-e10c-4fcc-8c6c-8e49da70dd69","block_type":"box","text":"Shares are sold to investors choosing the deferred sales charge alternative. Investor P Shares are","page_number":213,"box":{"x":116,"y":537,"width":735,"height":12}},{"id":"c8f86707-cb99-4e83-a060-95029ada7b74","block_type":"box","text":"available only to certain investors purchasing shares of Funds through registered representatives of an","page_number":213,"box":{"x":116,"y":552,"width":768,"height":12}},{"id":"a1065df7-bb84-49a4-a6de-d2cb1e3029a8","block_type":"box","text":"insurance company’s broker-dealer that has entered into an agreement with the Distributor to offer","page_number":213,"box":{"x":117,"y":568,"width":734,"height":12}},{"id":"4981b86a-3612-4172-8e97-9fa4dc78ded0","block_type":"box","text":"such shares. Institutional Shares are sold to certain eligible investors without a sales charge.","page_number":213,"box":{"x":116,"y":583,"width":692,"height":12}},{"id":"c42fc533-3890-4c76-9015-156955207e81","block_type":"box","text":"Certain Funds offer Class R Shares, which are avail","page_number":213,"box":{"x":117,"y":614,"width":367,"height":11}},{"id":"9f38cfd9-effd-4555-9b25-441d3ff22168","block_type":"box","text":"able only to certain employer-sponsored retirement","page_number":213,"box":{"x":485,"y":614,"width":368,"height":12}},{"id":"02f4071b-22c2-48fb-ae99-06e46706222d","block_type":"box","text":"plans and are sold without a sales charge. Certain Funds offer Class G Shares, which are available only to","page_number":213,"box":{"x":117,"y":630,"width":760,"height":12}},{"id":"b8e8e7f2-3bb3-461e-afe5-1797cdf8ba54","block_type":"box","text":"investors on eligible platforms, which are platforms","page_number":213,"box":{"x":117,"y":645,"width":358,"height":12}},{"id":"d0c728f4-ab5c-41ef-914d-b164aa7d61d5","block_type":"box","text":"where clients invest in the Fund through a single","page_number":213,"box":{"x":475,"y":645,"width":353,"height":12}},{"id":"5d818952-7fde-4ee5-aaba-9477d3021be9","block_type":"box","text":"omnibus account in the name of a financial intermedi","page_number":213,"box":{"x":116,"y":661,"width":374,"height":9}},{"id":"a08d30d4-d269-4681-9eab-f24ae8204f5b","block_type":"box","text":"ary that meets an initial investment minimum of","page_number":213,"box":{"x":492,"y":661,"width":335,"height":12}},{"id":"62328683-4d85-4dce-bfb6-3c53efc35620","block_type":"box","text":"$2 billion. In addition, certain Funds offer Service Share","page_number":213,"box":{"x":116,"y":675,"width":385,"height":12}},{"id":"cf02c8f1-b0ee-49f2-b5db-75d7cdfe469a","block_type":"box","text":"res, BlackRock Shares and/or Class K Shares that are","page_number":213,"box":{"x":501,"y":676,"width":382,"height":11}},{"id":"8f6bddaa-f778-4b85-9694-0b78f56f2fa1","block_type":"box","text":"available only to certain eligible investors. Pl","page_number":213,"box":{"x":116,"y":692,"width":312,"height":12}},{"id":"dea10a58-4e9e-4f92-8ce8-0d013e9f92f6","block_type":"box","text":"ease see the appropriate Prospectus for your Fund to","page_number":213,"box":{"x":429,"y":692,"width":381,"height":12}},{"id":"482c16e1-290f-4b75-b30e-64eea39acfee","block_type":"box","text":"determine which classes are offered by your Fund and under","page_number":213,"box":{"x":116,"y":707,"width":434,"height":12}},{"id":"ed06494e-1f0c-4bd1-ad76-ee38b86801a0","block_type":"box","text":"what circumstances. Each class has different","page_number":213,"box":{"x":553,"y":707,"width":322,"height":10}},{"id":"cb4a13d6-54e0-423a-89af-057b2b0b762b","block_type":"box","text":"exchange privileges. See “Shareholder Services — Exchange Privilege.”","page_number":213,"box":{"x":116,"y":723,"width":516,"height":12}},{"id":"9065cefb-81e5-4181-90cb-864bb6863d7d","block_type":"box","text":"The applicable offering price for purchase orders is based on the NAV of a Fund next determined after","page_number":213,"box":{"x":116,"y":754,"width":760,"height":12}},{"id":"44f91f62-4273-43b2-9e1e-0b9e9108387b","block_type":"box","text":"receipt of the purchase order by a dealer or other financial intermediary (“Selling Dealer”) that has","page_number":213,"box":{"x":117,"y":769,"width":724,"height":12}},{"id":"a19bcd11-ffa6-4d23-a20e-bbfe81dc48b8","block_type":"box","text":"been authorized by the Distributor by contract to accept such orders. In addition, with respect to the","page_number":213,"box":{"x":117,"y":785,"width":737,"height":12}},{"id":"02b2b406-ef79-4c52-86b6-01c3c7a0931d","block_type":"box","text":"affiliated underlying funds in which target date funds advised by BlackRock or its affiliates (“BlackRock","page_number":213,"box":{"x":116,"y":800,"width":759,"height":12}},{"id":"1f4670d7-a626-48df-8192-3437352cf42d","block_type":"box","text":"Target Date Funds”) invest, the applicable offering price of each affiliated underlying fund is based on","page_number":213,"box":{"x":116,"y":816,"width":752,"height":12}},{"id":"076647db-2060-460e-91ae-ef7157d828a1","block_type":"box","text":"the NAV of such affiliated underlying fund next determined after a purchase order is received, or","page_number":213,"box":{"x":116,"y":831,"width":718,"height":12}},{"id":"5917cc0b-e377-4d3a-8db7-14da0bbd500f","block_type":"box","text":"deemed to be received upon receipt by a Selling Dealer, by the BlackRock Target Date Funds that","page_number":213,"box":{"x":116,"y":847,"width":736,"height":12}},{"id":"d073eb90-11e3-4187-b086-c88bce96ffbe","block_type":"box","text":"allocate a portion of such purchase order to such affiliated underlying fund. As to purchase orders","page_number":213,"box":{"x":116,"y":862,"width":730,"height":12}},{"id":"d9f38da2-45d8-4fb1-af4e-7e5e890cdca3","block_type":"box","text":"received by Selling Dealers or BlackRock Target Date Funds prior to the close of business on the New","page_number":213,"box":{"x":117,"y":878,"width":765,"height":12}},{"id":"b1d99fb2-9bb9-4ddc-bc97-9389eb1636be","block_type":"box","text":"II-126","page_number":213,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"8fc6df95-316c-49b1-b312-54c9b70d7af0","block_type":"box","text":"NM1026U-6004382-213/605","page_number":213,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"687f6456-390d-464c-832d-d2a6b8fd4656","block_type":"box","text":"York Stock Exchange (“NYSE”) (generally, the NYSE closes at 4:00 p.m. Eastern time), on the day the","page_number":214,"box":{"x":116,"y":87,"width":767,"height":12}},{"id":"cf5d2ee6-ed21-4e23-bca5-8fe541eb0e76","block_type":"box","text":"order is placed, including orders received after the close of business on the previous day, the","page_number":214,"box":{"x":116,"y":102,"width":696,"height":13}},{"id":"3a4b99b9-3bc0-4d27-9714-5c0aa4b8ccab","block_type":"box","text":"applicable offering price is based on the NAV determined as of the close of business on the NYSE on","page_number":214,"box":{"x":116,"y":118,"width":757,"height":12}},{"id":"e33242a9-0996-4a4d-9014-b33c4bf206c2","block_type":"box","text":"that day. If the purchase orders are not received by the Selling Dealer or a BlackRock Target Date","page_number":214,"box":{"x":116,"y":134,"width":734,"height":12}},{"id":"9491abd4-75a6-48fb-8ac6-b287c8646821","block_type":"box","text":"Fund before the close of business on the NYSE, such orders are deemed received on the next","page_number":214,"box":{"x":117,"y":149,"width":706,"height":11}},{"id":"3ac33300-b20d-409f-b7ff-0c8a8c92a32b","block_type":"box","text":"business day. It is the responsibility of brokers to transmit purchase orders and payment on a timely","page_number":214,"box":{"x":117,"y":165,"width":745,"height":12}},{"id":"a842912f-ac15-4fac-befa-f51c2e8f0388","block_type":"box","text":"basis. Generally, if payment is not received within the period described in the Prospectuses, the order","page_number":214,"box":{"x":117,"y":180,"width":758,"height":12}},{"id":"0eb956b5-599a-4a0c-b681-a53222d68d9c","block_type":"box","text":"will be canceled, notice thereof will be given, and","page_number":214,"box":{"x":116,"y":196,"width":368,"height":12}},{"id":"4f672159-6d38-4419-b8fa-93c34639bb6a","block_type":"box","text":"the broker and its customers will be responsible for","page_number":214,"box":{"x":484,"y":196,"width":384,"height":11}},{"id":"e128198a-72d2-4a49-8d4f-a9be63bbf895","block_type":"box","text":"any loss to the Fund or its shareholders. Orders of less than $500 may be mailed by a broker to the","page_number":214,"box":{"x":116,"y":210,"width":743,"height":13}},{"id":"250bb221-fc75-4655-83a0-d9fd59f6473a","block_type":"box","text":"Transfer Agent.","page_number":214,"box":{"x":116,"y":227,"width":120,"height":12}},{"id":"7b7e3a71-e5e5-40d2-929e-8b51c55f66db","block_type":"box","text":"The minimum investment for the initial purchase of shares is set forth in the Prospectus for each Fund.","page_number":214,"box":{"x":116,"y":258,"width":766,"height":11}},{"id":"493b474e-388e-4763-b56f-6fa4fef1e6bf","block_type":"box","text":"The minimum initial investment for employees of a Fund, a Fund’s Manager, Sub-Advisers or BRIL or","page_number":214,"box":{"x":116,"y":273,"width":758,"height":12}},{"id":"a2dbf199-f0a2-4ad4-a4b4-11f769c86101","block_type":"box","text":"employees of their affiliates is $100, unless payment is made through a payroll deduction program in","page_number":214,"box":{"x":116,"y":288,"width":751,"height":13}},{"id":"e202a3ed-7d92-4f28-9871-4edc0ea2b318","block_type":"box","text":"which case the minimum investment is $25.","page_number":214,"box":{"x":116,"y":303,"width":329,"height":12}},{"id":"74f2b06d-42c0-4c1c-bb5b-58cb2b6089b3","block_type":"box","text":"Each Fund has lower investment minimums for other categories of shareholders eligible to purchase","page_number":214,"box":{"x":117,"y":335,"width":749,"height":12}},{"id":"917b4bdd-116d-44f4-915c-dc21ea0757bf","block_type":"box","text":"Institutional Shares, including selected fee-based programs. Each Fund may permit a lower initial","page_number":214,"box":{"x":117,"y":351,"width":726,"height":12}},{"id":"f2617c6d-8cf8-4546-b65a-23c0787f245c","block_type":"box","text":"investment for certain investors if their purchase, combined with purchases by other investors received","page_number":214,"box":{"x":117,"y":366,"width":766,"height":12}},{"id":"e3486369-2a50-4a81-88fc-7504a63b1aa0","block_type":"box","text":"together by the Fund, meets the minimum investment requirement. Each Fund may reject any","page_number":214,"box":{"x":116,"y":382,"width":702,"height":12}},{"id":"a8014090-4841-4fa6-9773-f1591557ecf5","block_type":"box","text":"purchase order, modify or waive the minimum initial or subsequent investment requirements and","page_number":214,"box":{"x":117,"y":397,"width":720,"height":12}},{"id":"12ad35fb-79c0-40cd-8a91-32275fe087ed","block_type":"box","text":"suspend and resume the sale of any share class of any Fund at any time.","page_number":214,"box":{"x":116,"y":413,"width":551,"height":12}},{"id":"9b5d4df6-d9df-49e8-a6cd-95c66f866c09","block_type":"box","text":"Financial intermediaries may, in connection with a change in account type or otherwise in accordance","page_number":214,"box":{"x":117,"y":444,"width":758,"height":12}},{"id":"63f314bb-eca6-40ae-88f1-c19b6b9f53ca","block_type":"box","text":"with a financial intermediary’s policies and procedures, exchange shares of a Fund from one class of","page_number":214,"box":{"x":116,"y":459,"width":753,"height":12}},{"id":"bae70d0a-d4ae-472e-9323-82d528f34246","block_type":"box","text":"shares to another class of shares of the same Fund, provided that the exchanged shares are not","page_number":214,"box":{"x":116,"y":475,"width":722,"height":12}},{"id":"9a09dcd5-ef18-4d23-a891-b841f0b93145","block_type":"box","text":"subject to a contingent deferred sales charge (“CDSC”) and that shareholders meet eligibility","page_number":214,"box":{"x":116,"y":490,"width":693,"height":12}},{"id":"8f0b02da-c978-4184-a950-273709823232","block_type":"box","text":"requirements of the new share class. Please speak to your financial intermediary for information about","page_number":214,"box":{"x":117,"y":506,"width":763,"height":12}},{"id":"211c1ba2-68c7-45e8-9dfb-2bf781410cb4","block_type":"box","text":"specific policies and procedures applicable to your account.","page_number":214,"box":{"x":116,"y":521,"width":448,"height":12}},{"id":"2557343b-24ce-4abb-8b15-b4c0379e5467","block_type":"box","text":"Each Fund or the Distributor may suspend the continuous offering of the Fund’s shares of any class at","page_number":214,"box":{"x":117,"y":552,"width":763,"height":12}},{"id":"a6e78b91-d5a9-4946-8f1e-9de006abee8f","block_type":"box","text":"any time in response to conditions in the securities markets or otherwise and may resume offering the","page_number":214,"box":{"x":116,"y":568,"width":761,"height":12}},{"id":"0ad8393e-f253-45e5-bb90-bd334bfb6289","block_type":"box","text":"shares from time to time. Any order may be rejected by a Fund or the Distributor. Neither the","page_number":214,"box":{"x":116,"y":583,"width":693,"height":12}},{"id":"e5ab8ba2-03a2-4eb7-b44d-dd3a1b1af20d","block_type":"box","text":"Distributor, the securities dealers nor other financial intermediaries are permitted to withhold placing","page_number":214,"box":{"x":117,"y":599,"width":744,"height":12}},{"id":"a5dc3c61-dd3f-4758-88bd-1ffd1a5d68b8","block_type":"box","text":"orders to benefit themselves by a price change.","page_number":214,"box":{"x":116,"y":614,"width":358,"height":12}},{"id":"8392fce2-3ceb-4962-9130-37b52c463a0a","block_type":"box","text":"The term “purchase,” as used in the Prospectus and this SAI, refers to (i) a single purchase by an","page_number":214,"box":{"x":116,"y":645,"width":729,"height":12}},{"id":"78800f05-5f38-4fbf-9e45-5a543923c7b3","block_type":"box","text":"individual, (ii) concurrent purchases by an individual, his or her spouse and their children purchasing","page_number":214,"box":{"x":117,"y":661,"width":742,"height":12}},{"id":"41c5f43e-f3ef-467a-ad6b-e6e96f0a7a96","block_type":"box","text":"shares for his, her or their own account, and (iii) single purchases by a trustee or other fiduciary","page_number":214,"box":{"x":116,"y":676,"width":709,"height":12}},{"id":"12a6a1cf-c2b6-4f98-be33-1ee77adc61d7","block_type":"box","text":"purchasing shares for a single trust estate or single fiduciary account although more than one","page_number":214,"box":{"x":117,"y":692,"width":693,"height":12}},{"id":"628c127a-3ec9-453e-92dc-ce9674c51a76","block_type":"box","text":"beneficiary may be involved. The term “purchase” also includes purchases by any “company,” as that","page_number":214,"box":{"x":117,"y":707,"width":751,"height":12}},{"id":"6f75d0b8-4496-4f9d-b174-2a169031286a","block_type":"box","text":"term is defined in the Investment Company Act, but does not include purchases by (i) any company","page_number":214,"box":{"x":116,"y":723,"width":738,"height":12}},{"id":"b7494ae4-2149-4fdc-93e4-6d7c2f5e4048","block_type":"box","text":"that has not been in existence for at least six months, (ii) a company that has no purpose other than","page_number":214,"box":{"x":116,"y":738,"width":740,"height":12}},{"id":"4135676d-78b7-40ec-8de3-dcc6f1f8957f","block_type":"box","text":"the purchase of shares of a Fund or shares of other registered investment companies at a discount, or","page_number":214,"box":{"x":116,"y":754,"width":760,"height":12}},{"id":"1320b861-54c6-4f97-a20d-0f33212c563c","block_type":"box","text":"(iii) any group of individuals whose sole organizational nexus is that its participants are credit","page_number":214,"box":{"x":117,"y":769,"width":687,"height":12}},{"id":"e482992f-92e0-40ca-8f2a-321127bcf50b","block_type":"box","text":"cardholders of a company, policyholders of an insurance company, customers of either a bank or","page_number":214,"box":{"x":116,"y":785,"width":721,"height":12}},{"id":"29c14878-2f2c-4858-b913-e1a5382aac8e","block_type":"box","text":"broker-dealer or clients of an investment adviser.","page_number":214,"box":{"x":117,"y":800,"width":361,"height":10}},{"id":"a70eebdf-4f77-40aa-82a6-b13c1569a9a1","block_type":"box","text":"With certain limited exceptions, the Funds are generally available only to investors residing in the","page_number":214,"box":{"x":116,"y":831,"width":725,"height":12}},{"id":"25280d1f-89aa-45dc-ac69-8fe78e040345","block_type":"box","text":"United States and may not be distributed by a foreign financial intermediary. Under this policy, in order","page_number":214,"box":{"x":117,"y":847,"width":764,"height":12}},{"id":"99423b82-c94e-4a83-967b-7beaaa508f92","block_type":"box","text":"to accept new accounts or additional investments (including by way of exchange from another Fund)","page_number":214,"box":{"x":116,"y":862,"width":750,"height":12}},{"id":"1e91f4ce-ec48-4256-abe2-f899160ebd01","block_type":"box","text":"into existing accounts, a Fund generally requires that (i) a shareholder that is a natural person be a","page_number":214,"box":{"x":117,"y":878,"width":738,"height":12}},{"id":"f277cfe9-0248-4c01-b882-daa9f1824a97","block_type":"box","text":"II-127","page_number":214,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"4a113e8a-b988-4a98-b64c-9bfc770d1d76","block_type":"box","text":"NM1026U-6004382-214/605","page_number":214,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"144fd301-ccd1-49af-89c9-4e828c03089d","block_type":"box","text":"U.S. citizen or resident alien, in each case residing within the United States or a U.S. territory","page_number":215,"box":{"x":117,"y":87,"width":695,"height":12}},{"id":"b41fde0c-542e-4d34-ac80-9fddebacfdb9","block_type":"box","text":"(including APO/FPO/DPO addresses), and have a valid U.S. taxpayer identification number, and (ii) a","page_number":215,"box":{"x":117,"y":102,"width":757,"height":13}},{"id":"baa1867a-b927-4d48-b890-079ea0fd750a","block_type":"box","text":"financial intermediary or a shareholder that is an entity be domiciled in the United States and have a","page_number":215,"box":{"x":116,"y":118,"width":747,"height":12}},{"id":"6abfd4d7-97cd-4d8f-9e23-07bfff4069ee","block_type":"box","text":"valid U.S. taxpayer identification number or be domiciled in a U.S. territory and have a valid U.S.","page_number":215,"box":{"x":116,"y":134,"width":720,"height":12}},{"id":"297ee0ca-7b7a-4944-a6b1-dd7b2aa72a28","block_type":"box","text":"taxpayer identification number or IRS Form W-8. Any existing account that is updated to reflect a","page_number":215,"box":{"x":116,"y":149,"width":723,"height":12}},{"id":"b626fea7-7945-4095-8f86-e44865dd1685","block_type":"box","text":"non-U.S. address will also be restricted from making additional investments.","page_number":215,"box":{"x":117,"y":165,"width":568,"height":12}},{"id":"2d90f35d-e5a5-4d77-9c4e-a966576864a1","block_type":"box","text":"In-Kind Purchases.","page_number":215,"box":{"x":117,"y":197,"width":139,"height":9}},{"id":"5e3bf8ea-5369-41dc-9f57-b48eee4f4bb7","block_type":"box","text":"Payment for shares of a Fund may, at the discretion of BlackRock, be made in the","page_number":215,"box":{"x":258,"y":197,"width":620,"height":12}},{"id":"e7bf4c18-4c3a-456a-8930-1818f6c4342b","block_type":"box","text":"form of securities that are permissible investments for the Fund and that meet the investment objective,","page_number":215,"box":{"x":116,"y":212,"width":772,"height":12}},{"id":"7316e940-100c-48af-b649-4c449dc535cb","block_type":"box","text":"policies and limitations of the Fund as described herein. In connection with an in-kind securities","page_number":215,"box":{"x":117,"y":228,"width":710,"height":12}},{"id":"e70d8a48-e9bd-4917-b2f1-e3d3709a77eb","block_type":"box","text":"payment, the Fund may require, among other things, that the securities: (i) be valued on the day of","page_number":215,"box":{"x":117,"y":243,"width":736,"height":12}},{"id":"4605d7b4-5461-4df7-849a-36c1d4a2f353","block_type":"box","text":"purchase in accordance with the pricing methods used by the Fund; (ii) be accompanied by","page_number":215,"box":{"x":117,"y":259,"width":682,"height":12}},{"id":"1d0ba452-2d4f-4f42-8a82-11a35b526321","block_type":"box","text":"satisfactory assurance that the Fund will have good and marketable title to such securities; (iii) not be","page_number":215,"box":{"x":116,"y":274,"width":757,"height":13}},{"id":"10875d41-6cbe-4190-ad90-1bed02b9434b","block_type":"box","text":"subject to any restrictions upon resale by the Fund; (iv) be in proper form for transfer to the Fund; and","page_number":215,"box":{"x":116,"y":290,"width":760,"height":12}},{"id":"4b3d5ca1-ff33-4c98-90b2-337b170ffb17","block_type":"box","text":"(v) be accompanied by adequate information concerning the basis and other tax matters relating to the","page_number":215,"box":{"x":117,"y":305,"width":766,"height":13}},{"id":"8e9e00ab-aff6-467a-b34c-6ac118bad68b","block_type":"box","text":"securities. All dividends, interest, subscription or other rights pertaining to such securities shall become","page_number":215,"box":{"x":116,"y":321,"width":769,"height":12}},{"id":"bce2283e-a322-4e20-9539-f0c79976ee01","block_type":"box","text":"the property of the Fund engaged in the in-kind purchase transaction and must be delivered to the","page_number":215,"box":{"x":116,"y":336,"width":732,"height":13}},{"id":"4db5091b-77f9-4478-8237-b68b690dfe48","block_type":"box","text":"Fund by the investor upon receipt from the issuer. Shares purchased in exchange for securities","page_number":215,"box":{"x":117,"y":352,"width":711,"height":12}},{"id":"0b661054-ddcd-450e-962a-fac7bcf7617d","block_type":"box","text":"generally cannot be redeemed until the transfer has settled.","page_number":215,"box":{"x":116,"y":367,"width":448,"height":13}},{"id":"17157bc6-8591-431b-8512-f714787340be","block_type":"box","text":"Institutional Shares","page_number":215,"box":{"x":117,"y":400,"width":160,"height":9}},{"id":"9a760108-1230-4f43-9798-8c2d14e81f96","block_type":"box","text":"Institutional Shares may be purchased at NAV without a sales charge. Only certain investors are","page_number":215,"box":{"x":117,"y":424,"width":720,"height":12}},{"id":"0bf95a3d-4044-4735-b1bc-4ff95f824447","block_type":"box","text":"eligible to purchase Institutional Shares. Investors who are eligible to purchase Institutional Shares","page_number":215,"box":{"x":116,"y":439,"width":737,"height":12}},{"id":"0bb064f5-6d85-472c-afef-9505209573f1","block_type":"box","text":"should purchase Institutional Shares because they are not subject to any sales charge and have lower","page_number":215,"box":{"x":116,"y":455,"width":765,"height":12}},{"id":"8665f332-69e2-4814-b62e-b45249f997e0","block_type":"box","text":"ongoing expenses than Investor A, Investor A1, Investor C, Investor P, Class R or Service Shares. A","page_number":215,"box":{"x":116,"y":470,"width":752,"height":12}},{"id":"baf3b586-57db-4450-97f5-c109888a1136","block_type":"box","text":"Fund may in its discretion waive or modify any minimum investment amount, may reject any order for","page_number":215,"box":{"x":117,"y":486,"width":755,"height":12}},{"id":"609eaa44-e808-478f-8e55-137b1e765eb8","block_type":"box","text":"any class of shares and may suspend and resume the sale of shares of any Fund at any time.","page_number":215,"box":{"x":116,"y":501,"width":703,"height":12}},{"id":"0ffc5321-177b-46c5-9a8e-312f61f33b51","block_type":"box","text":"Eligible Institutional Share Investors.","page_number":215,"box":{"x":116,"y":534,"width":269,"height":12}},{"id":"29905158-bc4e-414b-88ee-2e461cd81f02","block_type":"box","text":"Institutional Shares of the Funds may be purchased by customers","page_number":215,"box":{"x":387,"y":534,"width":499,"height":12}},{"id":"5dd6a32e-db4a-4d62-a111-3d32de4d4576","block_type":"box","text":"of broker-dealers and agents that have established a servicing relationship with the Fund on behalf of","page_number":215,"box":{"x":116,"y":549,"width":757,"height":12}},{"id":"80c8810e-064c-4dbb-bb06-6a8b936a0639","block_type":"box","text":"their customers. These broker-dealers and agents may impose additional or different conditions on the","page_number":215,"box":{"x":116,"y":565,"width":766,"height":12}},{"id":"c2ab051a-3263-44e8-a605-3e82e7f62904","block_type":"box","text":"purchase or redemption of Fund shares by their customers and may charge their customers","page_number":215,"box":{"x":117,"y":580,"width":686,"height":12}},{"id":"0b80b66a-4cf7-4571-aac1-7b073a70d54b","block_type":"box","text":"transaction, account or other fees on the purchase and redemption of Fund shares. Each broker-dealer","page_number":215,"box":{"x":116,"y":596,"width":771,"height":12}},{"id":"ad6fba10-e0b1-49c6-8993-e349ddf5a5b9","block_type":"box","text":"or agent is responsible for transmitting to its customers a schedule of any such fees and information","page_number":215,"box":{"x":116,"y":611,"width":747,"height":12}},{"id":"c93e6f8e-c9dc-451e-b0fe-bd88125577f7","block_type":"box","text":"regarding any additional or different conditions regarding purchases and redemptions. Shareholders","page_number":215,"box":{"x":117,"y":627,"width":746,"height":12}},{"id":"327794e5-b8cd-4742-96bc-789a01b710f7","block_type":"box","text":"who are customers of such broker-dealers or agents should consult them for information regarding","page_number":215,"box":{"x":116,"y":642,"width":736,"height":12}},{"id":"99ccffc8-2c01-4cf9-ad8a-88d7f4625d0e","block_type":"box","text":"these fees and conditions.","page_number":215,"box":{"x":116,"y":658,"width":200,"height":9}},{"id":"adff0203-8afd-454f-8c02-bc5a2be62fd5","block_type":"box","text":"Payment for Institutional Shares must normally be made in Federal funds or other funds immediately","page_number":215,"box":{"x":117,"y":690,"width":745,"height":12}},{"id":"16341168-f7a7-42c6-8e37-6f6ddc4dcd5b","block_type":"box","text":"available by 4 p.m. (Eastern time) on the first business day following receipt of the order. Payment may","page_number":215,"box":{"x":116,"y":705,"width":765,"height":13}},{"id":"ffca65b0-f732-40a2-9c3d-c2c1d90ff39f","block_type":"box","text":"also, in the discretion of certain Funds, be made in the form of securities that are permissible","page_number":215,"box":{"x":116,"y":721,"width":688,"height":12}},{"id":"e039b58e-5038-48bd-b229-74a26e76ad24","block_type":"box","text":"investments for such Funds. If payment for a purchase order is not received by the prescribed time, an","page_number":215,"box":{"x":117,"y":736,"width":760,"height":13}},{"id":"765e69a0-1cfa-4045-b776-9f033cb37bd7","block_type":"box","text":"investor may be liable for any resulting losses or expenses incurred by the Fund.","page_number":215,"box":{"x":117,"y":752,"width":597,"height":12}},{"id":"a9b47b1c-1842-4ecd-a8ce-d2eb64a076a2","block_type":"box","text":"Certain of the Funds offer Institutional Shares","page_number":215,"box":{"x":117,"y":784,"width":345,"height":10}},{"id":"302171fa-f716-4c68-a7fc-a34cc68764ae","block_type":"box","text":"as described in each such Fund’s Prospectus. 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trust","page_number":216,"box":{"x":521,"y":350,"width":355,"height":12}},{"id":"bf55c32f-04f0-4fa1-8e87-ce3411e94b09","block_type":"box","text":"department clients of Bank of Amer","page_number":216,"box":{"x":116,"y":366,"width":269,"height":12}},{"id":"14d1ecf2-e98e-493b-80f7-8ec8d28089d6","block_type":"box","text":"ica, N.A. and its affiliates for whom they (i) act in a fiduciary","page_number":216,"box":{"x":386,"y":366,"width":455,"height":12}},{"id":"ea8237d0-62ef-409b-9700-c609e1b8bda0","block_type":"box","text":"capacity (excluding participant directed employee","page_number":216,"box":{"x":116,"y":382,"width":380,"height":12}},{"id":"8e7620c3-bf2e-4453-8658-17d5748a4c66","block_type":"box","text":"benefit plans), (ii) otherwise have investment","page_number":216,"box":{"x":497,"y":382,"width":345,"height":12}},{"id":"7a371a68-ea12-4c86-9347-9cddc7f6ef3e","block_type":"box","text":"discretion, or (iii) act as custodian for at least","page_number":216,"box":{"x":116,"y":397,"width":346,"height":12}},{"id":"5d9ce692-b385-4db4-b6b9-f01c6f7b2f73","block_type":"box","text":"$2 million in assets; and holders of certain BofA Corp.","page_number":216,"box":{"x":463,"y":396,"width":414,"height":13}},{"id":"8d4a89fb-5b55-4bb5-a28e-d3db72421925","block_type":"box","text":"sponsored unit investment trusts (UITs) who reinvest","page_number":216,"box":{"x":116,"y":413,"width":401,"height":12}},{"id":"d69f48b3-096b-4471-b9e6-57f3da973d36","block_type":"box","text":"dividends received from such UITs in shares of","page_number":216,"box":{"x":518,"y":413,"width":367,"height":9}},{"id":"56866997-0bff-462f-aad0-39ea509a512b","block_type":"box","text":"a Fund.","page_number":216,"box":{"x":116,"y":428,"width":63,"height":10}},{"id":"47a3bfa4-f7e2-4c04-ba79-c23fe52a3532","block_type":"box","text":"Purchase Privileges of Certain Persons.","page_number":216,"box":{"x":116,"y":457,"width":295,"height":12}},{"id":"01a2fe8f-ba23-49aa-919b-60879f67929e","block_type":"box","text":"Employees, officers, directors/trustees of BlackRock, Inc.,","page_number":216,"box":{"x":413,"y":457,"width":439,"height":12}},{"id":"5963fbd5-ba50-44e9-aff6-310c1379249d","block_type":"box","text":"BlackRock Funds, BofA Corp. or their respective affiliates; and any trust, pension, profit-sharing or","page_number":216,"box":{"x":117,"y":472,"width":733,"height":12}},{"id":"fcf129a4-8383-4a6d-9929-0d62e254a925","block_type":"box","text":"other benefit plan for such persons may purchase Institutional Shares at lower investment minimums","page_number":216,"box":{"x":116,"y":488,"width":753,"height":12}},{"id":"a954dc01-03e4-4a9b-ac99-b7a9e1f52de2","block_type":"box","text":"than stated in each Fund’s Prospectus. A Fund realizes economies of scale and reduction of sales","page_number":216,"box":{"x":116,"y":503,"width":735,"height":12}},{"id":"8dd8b4ea-4938-4121-8dba-a68b5f5fb456","block_type":"box","text":"related expenses by virtue of the familiarity of these persons with the Fund. Employees, directors, and","page_number":216,"box":{"x":117,"y":519,"width":761,"height":12}},{"id":"5f71e270-8311-44b2-b3ab-8d9d8155e83a","block_type":"box","text":"board members of other funds wishing to purchase shares of a Fund must satisfy the Fund’s suitability","page_number":216,"box":{"x":117,"y":534,"width":764,"height":12}},{"id":"f0c8de36-1b68-49f0-a3ae-2bbdd2bf414a","block_type":"box","text":"standards.","page_number":216,"box":{"x":116,"y":550,"width":83,"height":9}},{"id":"7f5a2d8c-ca95-4e21-b89d-72b72f7f6579","block_type":"box","text":"Initial Sales Charge Alternative — Investor A Shares","page_number":216,"box":{"x":117,"y":579,"width":420,"height":12}},{"id":"ec6a068b-02d0-4a6a-8298-2978be4cfafa","block_type":"box","text":"Investors who prefer an initial sales charge alternative may elect to purchase Investor A Shares.","page_number":216,"box":{"x":117,"y":601,"width":717,"height":12}},{"id":"dd1902f1-baad-4b22-bc24-f6b4becfd2d4","block_type":"box","text":"Investor A1 Shares are offered only (i) for purchase by certain employer-sponsored retirement plans","page_number":216,"box":{"x":117,"y":616,"width":748,"height":12}},{"id":"7359a38b-96dd-497d-aef5-a194f9254a67","block_type":"box","text":"and fee-based programs that have been previously approved by certain Funds, and (ii) to certain","page_number":216,"box":{"x":116,"y":632,"width":723,"height":12}},{"id":"5d41ed61-2faa-448e-92ba-631a919a97b8","block_type":"box","text":"investors who currently hold Investor A1 Shares for dividend and capital gain reinvestment only. The","page_number":216,"box":{"x":117,"y":647,"width":749,"height":12}},{"id":"fdc89d61-7204-4b80-87b5-e194eab72438","block_type":"box","text":"Investor A1 initial sales charge does not apply to the transactions described in (i) and (ii). For ease of","page_number":216,"box":{"x":117,"y":663,"width":750,"height":12}},{"id":"1d9f2171-3fde-46e7-9e80-cc5ccf7559a3","block_type":"box","text":"reference, Investor A, Investor A1 and Investor P (discussed below) Shares are sometimes referred to","page_number":216,"box":{"x":117,"y":678,"width":757,"height":12}},{"id":"ebb6e4d9-1156-47c3-8fa1-d882e8d3e66e","block_type":"box","text":"herein as “front-end load shares.” Investor A Shares of Index Funds (defined below) and BlackRock","page_number":216,"box":{"x":117,"y":694,"width":739,"height":12}},{"id":"acf30d0a-a6cc-4164-a9f1-04db0e0b372c","block_type":"box","text":"Short Obligations Fund generally are not subject to an initial sales charge or front-end load.","page_number":216,"box":{"x":116,"y":709,"width":677,"height":12}},{"id":"df466fc5-1453-4a8d-bf54-8003ff411129","block_type":"box","text":"Investors qualifying for significantly reduced initial sales charges may find the initial sales charge","page_number":216,"box":{"x":117,"y":738,"width":715,"height":12}},{"id":"5c1ec2f1-8035-4834-b0f4-2752751371bd","block_type":"box","text":"alternative particularly attractive because similar sales charge reductions are not available with respect","page_number":216,"box":{"x":116,"y":754,"width":763,"height":12}},{"id":"1545c77a-2916-4c49-8b22-5724378844e0","block_type":"box","text":"to the deferred sales charges imposed in connection with investments in Investor C Shares","page_number":216,"box":{"x":116,"y":769,"width":676,"height":12}},{"id":"ad6f26b1-c81d-41ba-863a-341c9c570844","block_type":"box","text":"(sometimes referred to herein as “CDSC shares”). Investors who do not qualify for reduced initial sales","page_number":216,"box":{"x":117,"y":784,"width":761,"height":13}},{"id":"f646e464-aae4-44b5-91f7-cea5809d71c7","block_type":"box","text":"charges and who expect to maintain their investment for an extended period of time also may elect to","page_number":216,"box":{"x":116,"y":800,"width":752,"height":12}},{"id":"0841efbb-6ec8-4db1-a3ec-bdbd0c0f466f","block_type":"box","text":"purchase Investor A Shares, because over time the accumulated ongoing service and distribution fees","page_number":216,"box":{"x":117,"y":815,"width":759,"height":13}},{"id":"7237db36-cbf7-4a7f-8e4b-5ec8e09ee472","block_type":"box","text":"on CDSC shares may exceed the front-end load shares’ initial sales charge and service fee. Although","page_number":216,"box":{"x":116,"y":831,"width":759,"height":12}},{"id":"784b97ff-251d-4405-a9c9-5c569766fdad","block_type":"box","text":"some investors who previously purchased Institutional Shares may no longer be eligible to purchase","page_number":216,"box":{"x":116,"y":846,"width":749,"height":13}},{"id":"f978004a-65f6-4d49-a1df-aa08b660f666","block_type":"box","text":"Institutional Shares of other Funds, those previously purchased Institutional Shares, together with all","page_number":216,"box":{"x":117,"y":862,"width":749,"height":12}},{"id":"fcc3fa51-8ce7-45ca-b19c-c645033e0615","block_type":"box","text":"BlackRock front-end load and CDSC share holdings, will count toward a right of accumulation that may","page_number":216,"box":{"x":117,"y":877,"width":768,"height":13}},{"id":"4872120e-ac38-4379-8606-9b57781a71a3","block_type":"box","text":"II-129","page_number":216,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"df991588-a22e-4490-8705-70f13a5a013e","block_type":"box","text":"NM1026U-6004382-216/605","page_number":216,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5daca595-6531-438b-a6e6-757c242675b2","block_type":"box","text":"qualify the investor for a reduced initial sales charge on new initial sales charge purchases. In addition,","page_number":217,"box":{"x":116,"y":87,"width":768,"height":12}},{"id":"4e9de92c-d04a-47a0-8ed8-c83758893988","block_type":"box","text":"the ongoing CDSC shares service and distribution fees will cause CDSC shares to have higher","page_number":217,"box":{"x":116,"y":102,"width":709,"height":13}},{"id":"42177881-e9d9-49e7-8365-d2cbdb858357","block_type":"box","text":"expense ratios, pay lower dividends and have lower total returns than the initial sales charge shares.","page_number":217,"box":{"x":116,"y":118,"width":752,"height":12}},{"id":"53246df6-06a1-45c0-985d-c7e3fdcebdf6","block_type":"box","text":"The ongoing front-end load shares’ service fees will cause Investor A, Investor A1, Investor P and","page_number":217,"box":{"x":116,"y":134,"width":731,"height":12}},{"id":"8c2b3ad4-4b62-4efe-96fb-4dfac547f052","block_type":"box","text":"Service Shares to have a higher expense ratio, pay lower dividends and have a lower total return than","page_number":217,"box":{"x":116,"y":149,"width":762,"height":12}},{"id":"8742e5de-6964-4ff4-b729-d8b4ec83297e","block_type":"box","text":"Institutional Shares.","page_number":217,"box":{"x":117,"y":165,"width":151,"height":9}},{"id":"c6190a1b-f95b-4dca-8e06-de06cd7f4558","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Part I of each Fund’s SAI for","page_number":217,"box":{"x":116,"y":196,"width":770,"height":12}},{"id":"72d1c813-98eb-4aff-a0b8-957b3a59d7ae","block_type":"box","text":"information about amounts paid to the Distributor in connection with Investor A and Investor A1 Shares","page_number":217,"box":{"x":117,"y":211,"width":767,"height":12}},{"id":"d4a65752-082b-4b95-83ba-615ff6a72953","block_type":"box","text":"for the periods indicated.","page_number":217,"box":{"x":116,"y":227,"width":189,"height":11}},{"id":"5560e985-b301-4c27-8969-bfe3875cefa1","block_type":"box","text":"The Distributor may reallow discounts to selected securities dealers and other financial intermediaries","page_number":217,"box":{"x":116,"y":258,"width":759,"height":12}},{"id":"0babf4b3-239a-4e35-98d5-393489d02c03","block_type":"box","text":"and retain the balance over such discounts. At times the Distributor may reallow the entire sales","page_number":217,"box":{"x":116,"y":273,"width":717,"height":12}},{"id":"5c37e965-3233-40dd-951e-6245f20a09d4","block_type":"box","text":"charge to such dealers. Since securities dealers and other financial intermediaries selling front-end","page_number":217,"box":{"x":116,"y":289,"width":739,"height":12}},{"id":"476ab643-b426-4fc8-8061-0eb84d3323f5","block_type":"box","text":"load shares of a Fund will receive a concession equal to most of the sales charge, they may be","page_number":217,"box":{"x":117,"y":304,"width":710,"height":12}},{"id":"9790e09d-95c7-4e4b-a09f-f1218fd4a0e4","block_type":"box","text":"deemed to be underwriters under the Securities Act.","page_number":217,"box":{"x":116,"y":320,"width":393,"height":9}},{"id":"445284ee-987b-44ea-9fd5-5564d00c4465","block_type":"box","text":"Initial Sales Charge — Investor P Shares","page_number":217,"box":{"x":117,"y":351,"width":327,"height":12}},{"id":"e53f5bed-ab20-4a6e-8a56-101e15f92fb2","block_type":"box","text":"Certain Funds offer Investor P Shares as described in each such Fund’s Prospectus, Investor P","page_number":217,"box":{"x":117,"y":374,"width":715,"height":12}},{"id":"8eca5e2a-5ed4-4d23-ac93-31e51f93f4fc","block_type":"box","text":"Shares are available for purchase only through registered representatives of an insurance company’s","page_number":217,"box":{"x":116,"y":389,"width":758,"height":12}},{"id":"8cafb1b4-96dd-48cf-9079-20a4e26244b5","block_type":"box","text":"broker-dealer that has entered into an agreement with the Distributor to offer such shares and are","page_number":217,"box":{"x":117,"y":405,"width":729,"height":12}},{"id":"c40708f3-ed82-45f4-b909-d29fc1af73ad","block_type":"box","text":"subject to an initial sales charge. The ongoing front-end load shares’ service fees will cause Investor P","page_number":217,"box":{"x":116,"y":420,"width":766,"height":12}},{"id":"9f9cd5fb-0de9-466f-b08d-484bc8a52ab9","block_type":"box","text":"Shares to have a higher expense ratio, pay lower dividends and have a lower total return than Investor","page_number":217,"box":{"x":116,"y":436,"width":766,"height":12}},{"id":"549259e3-7d20-41aa-9cab-424bb3776d04","block_type":"box","text":"A Shares of the same Fund.","page_number":217,"box":{"x":116,"y":451,"width":214,"height":10}},{"id":"3ded9251-a77f-4a7a-a327-ae18e15d9fe0","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Part I of each Fund’s SAI for","page_number":217,"box":{"x":116,"y":482,"width":770,"height":12}},{"id":"e351b903-bbaf-4a35-9bab-f7710dfd9788","block_type":"box","text":"information about amounts paid to the Distributor in connection with Investor P Shares for the periods","page_number":217,"box":{"x":117,"y":498,"width":757,"height":12}},{"id":"ac5fb5c7-2021-44fc-b9ab-3bf9acead96c","block_type":"box","text":"indicated.","page_number":217,"box":{"x":117,"y":514,"width":75,"height":9}},{"id":"774b2deb-1fdb-4258-b76b-311a500c622f","block_type":"box","text":"The Distributor may reallow discounts to selected securities dealers and other financial intermediaries","page_number":217,"box":{"x":116,"y":544,"width":759,"height":12}},{"id":"0d0c1621-f07a-4094-b023-0817e6ae50c3","block_type":"box","text":"and retain the balance over such discounts. At times the Distributor may reallow the entire sales","page_number":217,"box":{"x":116,"y":560,"width":717,"height":12}},{"id":"02ffc563-cf90-4155-9c66-1da49567f2f1","block_type":"box","text":"charge to such dealers. Since securities dealers and other financial intermediaries selling front-end","page_number":217,"box":{"x":116,"y":575,"width":739,"height":12}},{"id":"1759147d-633d-416a-8ca8-9a5c3de3f48a","block_type":"box","text":"load shares of a Fund will receive a concession equal to most of the sales charge, they may be","page_number":217,"box":{"x":117,"y":591,"width":710,"height":12}},{"id":"98c3a0c4-5fea-4eaa-81b1-13a02771f861","block_type":"box","text":"deemed to be underwriters under the Securities Act.","page_number":217,"box":{"x":116,"y":606,"width":393,"height":10}},{"id":"f0d40fb3-2009-44cb-85fd-1b5424fe67ea","block_type":"box","text":"Reduced Initial Sales Charges","page_number":217,"box":{"x":117,"y":637,"width":244,"height":12}},{"id":"ccccb9dd-ed3c-488e-a532-cb97ba5bbd22","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","page_number":217,"box":{"x":117,"y":661,"width":737,"height":12}},{"id":"11ba5ef9-2066-4f08-9012-f7bced7e72e4","block_type":"box","text":"investors and/or the reduced sales efforts necessary to obtain their investments. Financial","page_number":217,"box":{"x":117,"y":676,"width":666,"height":12}},{"id":"5a49672c-d26a-449f-8a02-3bf699c1395d","block_type":"box","text":"intermediaries may, in connection with a change in account type or otherwise in accordance with a","page_number":217,"box":{"x":117,"y":692,"width":730,"height":12}},{"id":"9bbdbbb1-3b2a-4e1a-b676-eff2f73d2358","block_type":"box","text":"financial intermediary’s policies and procedures, exchange shares of a Fund from one class of shares","page_number":217,"box":{"x":116,"y":707,"width":754,"height":12}},{"id":"a1f682ba-e611-41be-a895-792b4cd4d594","block_type":"box","text":"to another class of shares of the same Fund provided that the exchanged shares are not subject to a","page_number":217,"box":{"x":116,"y":723,"width":748,"height":12}},{"id":"316ba5c3-b5c5-4cc8-bcb6-61b3e8f83d5a","block_type":"box","text":"contingent deferred sales charge and that shareholders meet the eligibility requirements of the new","page_number":217,"box":{"x":116,"y":738,"width":736,"height":12}},{"id":"b90a60b4-cac8-4d9c-a151-0fd0914fb02f","block_type":"box","text":"share class. Certain sales load reductions and waivers may be available to customers of certain","page_number":217,"box":{"x":116,"y":754,"width":711,"height":12}},{"id":"77a95288-d975-4901-a78d-2e22358ef9c0","block_type":"box","text":"financial intermediaries, as described under “Intermediary-Defined Sales Charge Waiver Policies” in","page_number":217,"box":{"x":116,"y":769,"width":740,"height":12}},{"id":"b08c2054-4280-422c-892f-52864ee6e14f","block_type":"box","text":"the Fund’s Prospectus. Please speak to your financial intermediary for more information.","page_number":217,"box":{"x":116,"y":785,"width":656,"height":12}},{"id":"b86cce80-3a5d-4262-bf91-a9a5cb2880dd","block_type":"box","text":"Reinvested Dividends.","page_number":217,"box":{"x":116,"y":816,"width":165,"height":9}},{"id":"61ea7b19-ec04-48a5-8ea2-a41e6b45745c","block_type":"box","text":"No sales charges are imposed upon shares issued as a result of the automatic","page_number":217,"box":{"x":289,"y":816,"width":583,"height":12}},{"id":"46df42ab-c4c4-4d71-8855-ba9c758d35f7","block_type":"box","text":"reinvestment of dividends.","page_number":217,"box":{"x":117,"y":831,"width":199,"height":10}},{"id":"b6f3664a-4c9a-4586-900a-239701345e9d","block_type":"box","text":"Right of Accumulation.","page_number":217,"box":{"x":116,"y":862,"width":166,"height":12}},{"id":"663ed83a-a2fc-495a-9df2-302a21de5758","block_type":"box","text":"Investors have a “right of accumulation” under which any of the following may","page_number":217,"box":{"x":284,"y":862,"width":585,"height":12}},{"id":"d7117361-fce4-4c8f-9025-49f10293eb77","block_type":"box","text":"be combined with the amount of the current purchase in determining whether an investor qualifies for a","page_number":217,"box":{"x":117,"y":878,"width":768,"height":12}},{"id":"285e701e-f59a-48a1-973f-e12e89cd6f58","block_type":"box","text":"II-130","page_number":217,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"d65e3230-20ee-4890-8ce1-bc8bcc7e8b03","block_type":"box","text":"NM1026U-6004382-217/605","page_number":217,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"0f43b75a-a0ce-41d7-ba54-0e3288f548a7","block_type":"box","text":"breakpoint and a reduced front-end sales charge: (i) the current value of an investor’s existing Investor","page_number":218,"box":{"x":117,"y":87,"width":765,"height":12}},{"id":"b4a4c83f-a81e-4255-95e1-88c2eb496533","block_type":"box","text":"A, Investor A1, Investor C, Investor P, Institutional, Class K and Premier Shares in most BlackRock","page_number":218,"box":{"x":116,"y":102,"width":741,"height":12}},{"id":"07caffaf-9f58-4bee-b22b-77435db023b3","block_type":"box","text":"Funds, (ii) the current value of an investor’s existing shares of certain unlisted closed-end management","page_number":218,"box":{"x":117,"y":118,"width":770,"height":12}},{"id":"31ff86bf-73b4-4f78-b4b8-dde28ba15f26","block_type":"box","text":"investment companies sponsored and advised by BlackRock or its affiliates (“Eligible Unlisted","page_number":218,"box":{"x":117,"y":134,"width":699,"height":12}},{"id":"82c7e01c-48eb-408f-a4f2-09c24b185e0d","block_type":"box","text":"BlackRock Closed-End Funds”) and (iii) the investment in the BlackRock CollegeAdvantage 529","page_number":218,"box":{"x":117,"y":149,"width":717,"height":12}},{"id":"01dc14de-d21b-4d58-b59d-29d46d5012dc","block_type":"box","text":"Program by the investor or by or on behalf of the investor’s spouse and children. Financial","page_number":218,"box":{"x":117,"y":165,"width":673,"height":12}},{"id":"d4712c71-df08-4445-9a0e-3bd95956be88","block_type":"box","text":"intermediaries may value current holdings of their customers differently for purposes of determining","page_number":218,"box":{"x":117,"y":180,"width":741,"height":12}},{"id":"60853bec-1316-47bf-818e-8d293797f2b7","block_type":"box","text":"whether an investor qualifies for a breakpoint and a reduced front-end sales charge, although","page_number":218,"box":{"x":116,"y":196,"width":698,"height":12}},{"id":"c6c04484-5652-4528-a0f5-3cddd32f154d","block_type":"box","text":"customers of the same financial intermediary will be treated similarly. In order to use this right, the","page_number":218,"box":{"x":116,"y":211,"width":732,"height":12}},{"id":"4b1aebd1-c2f3-4b46-96ab-6d91fdb4ad35","block_type":"box","text":"investor must alert BlackRock to the existence of any previously purchased shares. Certain funds","page_number":218,"box":{"x":117,"y":227,"width":727,"height":12}},{"id":"adc64b83-49c7-44e8-86c8-7f718f71703e","block_type":"box","text":"employ a “passive” management approach and attempt to match the performance of a target index as","page_number":218,"box":{"x":116,"y":242,"width":762,"height":12}},{"id":"cd136a94-5c40-4bb2-85e9-dcc126c702ee","block_type":"box","text":"closely as possible before the deduction of Fund expenses (“Index Funds”). Although Investor A","page_number":218,"box":{"x":116,"y":258,"width":717,"height":12}},{"id":"e822b5b1-640a-47ff-9454-e18830c0a1eb","block_type":"box","text":"Shares of Index Funds and BlackRock Short Obligations Fund generally are not subject to a sales","page_number":218,"box":{"x":116,"y":273,"width":732,"height":12}},{"id":"c0691e72-de88-435a-b46a-d6f55f1098c4","block_type":"box","text":"charge, an investor’s existing Investor A, Investor A1, Investor C, Investor P, Institutional, Class K and","page_number":218,"box":{"x":116,"y":289,"width":763,"height":12}},{"id":"3e4be1b3-d966-4a4b-8de5-cff132bb1629","block_type":"box","text":"Premier Shares in the Index Funds and BlackRock Short Obligations Fund may be combined with the","page_number":218,"box":{"x":117,"y":304,"width":757,"height":12}},{"id":"6166f6dd-7650-45e3-8d1f-2ae24953cc4b","block_type":"box","text":"amount of an investor’s current purchase in determining whether an investor qualifies for a breakpoint","page_number":218,"box":{"x":116,"y":320,"width":760,"height":12}},{"id":"4fcd6b97-20bc-45ac-a0ee-4c8c93ca8f20","block_type":"box","text":"and a reduced front-end sales charge.","page_number":218,"box":{"x":116,"y":335,"width":289,"height":12}},{"id":"e5d6d1ac-c0ca-428c-9d9a-afa9d5824e5f","block_type":"box","text":"Letter of Intent.","page_number":218,"box":{"x":116,"y":361,"width":111,"height":9}},{"id":"b4c91fd9-3c77-4541-8fcf-ca34fedb7c40","block_type":"box","text":"An investor may qualify for a reduced front-end sales charge immediately by signing a","page_number":218,"box":{"x":229,"y":361,"width":649,"height":12}},{"id":"3d8aa141-be9f-4b9f-bcab-95a9fb927c29","block_type":"box","text":"“Letter of Intent” stating the investor’s intention to make one or more of the following investments within","page_number":218,"box":{"x":116,"y":376,"width":770,"height":12}},{"id":"8460950c-769d-4e6a-a0d8-ccbb00742446","block_type":"box","text":"the next 13 months which would, if bought all at once, qualify the investor for a reduced sales charge:","page_number":218,"box":{"x":116,"y":392,"width":758,"height":12}},{"id":"59a49f1a-1df8-4be8-96e7-7efba36505a0","block_type":"box","text":"(i) buy a specified amount of Investor A, Investor C, Investor P, Institutional, Class K and/or Premier","page_number":218,"box":{"x":117,"y":407,"width":745,"height":12}},{"id":"713e3a58-b992-422e-b024-170a4b85851a","block_type":"box","text":"Shares, (ii) make an investment in one or more Eligible Unlisted BlackRock Closed-End Funds and/or","page_number":218,"box":{"x":116,"y":423,"width":759,"height":12}},{"id":"64aba90d-1564-4bae-bb63-97c0aa8fde75","block_type":"box","text":"(iii) make an investment through the BlackRock CollegeAdvantage 529 Program in one or more","page_number":218,"box":{"x":117,"y":438,"width":712,"height":12}},{"id":"ff0919d7-f785-451a-a5be-f4712f1b8a1a","block_type":"box","text":"BlackRock Funds. The initial investment must meet the minimum initial purchase requirement. The","page_number":218,"box":{"x":117,"y":454,"width":736,"height":12}},{"id":"e08d3345-d633-4278-a491-6b70715a83a7","block_type":"box","text":"13-month Letter of Intent period commences on the day that the Letter of Intent is received by the","page_number":218,"box":{"x":118,"y":469,"width":727,"height":12}},{"id":"1b9ae70f-3c89-4bea-b908-23ba0370ac64","block_type":"box","text":"Fund. The market value of current holdings in the BlackRock Funds (including Investor A, Investor C,","page_number":218,"box":{"x":117,"y":485,"width":754,"height":12}},{"id":"8109c6c2-6df3-4515-9980-20a1fe09c8cf","block_type":"box","text":"Investor P, Institutional, Class K and Premier Shares, Eligible Unlisted BlackRock Closed-End Funds","page_number":218,"box":{"x":117,"y":500,"width":752,"height":12}},{"id":"2f8108be-69bf-4633-8d99-691630eb3aaa","block_type":"box","text":"and the BlackRock CollegeAdvantage 529 Program Class A and Class C Units) as of the date of","page_number":218,"box":{"x":116,"y":516,"width":722,"height":12}},{"id":"3df83757-2693-48cb-950e-ad735e87ee6b","block_type":"box","text":"commencement that are eligible under the Right of Accumulation may be counted towards the sales","page_number":218,"box":{"x":116,"y":531,"width":747,"height":12}},{"id":"deab944c-ad66-45ae-b135-fdc91162839e","block_type":"box","text":"charge reduction. The investor must notify the Fund of (i) any current holdings in the BlackRock Funds,","page_number":218,"box":{"x":116,"y":547,"width":770,"height":12}},{"id":"f8e6b886-4bd3-4501-ac1f-58f72d509935","block_type":"box","text":"Eligible Unlisted BlackRock Closed-End Funds and/or the BlackRock CollegeAdvantage 529 Program","page_number":218,"box":{"x":117,"y":562,"width":759,"height":12}},{"id":"18aa0522-60ac-4a22-b746-386df9de632e","block_type":"box","text":"that should be counted towards the sales charge reduction and (ii) any subsequent purchases that","page_number":218,"box":{"x":116,"y":578,"width":735,"height":12}},{"id":"3e47148f-83fc-4a81-9478-f9cf25c8b1ac","block_type":"box","text":"should be counted towards the Letter of Intent. During the term of the Letter of Intent, the Fund will","page_number":218,"box":{"x":116,"y":593,"width":737,"height":12}},{"id":"0e66def7-4fd8-468a-b009-5b16dd963b4c","block_type":"box","text":"hold Investor A Shares and/or Investor P Shares, as applicable, representing up to 5% of the indicated","page_number":218,"box":{"x":117,"y":609,"width":765,"height":12}},{"id":"0bc87ff4-cbf5-4fe9-987b-3c8bd537f712","block_type":"box","text":"amount in an escrow account for payment of a higher sales load if the full amount indicated in the","page_number":218,"box":{"x":116,"y":624,"width":728,"height":13}},{"id":"ec0ad1fb-f5a0-416c-a5fa-23a75f0186d6","block_type":"box","text":"Letter of Intent is not purchased. If the full amount indicated is not purchased within the 13-month","page_number":218,"box":{"x":117,"y":640,"width":726,"height":12}},{"id":"550797bc-1880-454e-a00b-a667c245d67e","block_type":"box","text":"period, and the investor does not pay the higher sales load within 20 days, the Fund will redeem","page_number":218,"box":{"x":117,"y":656,"width":717,"height":12}},{"id":"fdd6f817-0a8d-4693-8e87-46882c437ef7","block_type":"box","text":"enough of the Investor A Shares and/or Investor P Shares, as applicable, held in escrow to pay the","page_number":218,"box":{"x":116,"y":671,"width":735,"height":12}},{"id":"ccaa70e0-a739-4972-b489-791c8cd59733","block_type":"box","text":"difference.","page_number":218,"box":{"x":116,"y":686,"width":77,"height":10}},{"id":"8f2b8d3c-76c4-4de4-82a9-8cb70ad06147","block_type":"box","text":"Placement Fees.","page_number":218,"box":{"x":116,"y":712,"width":124,"height":10}},{"id":"ab1a24c2-3a5b-4feb-a36c-e5e8ab1fb0c9","block_type":"box","text":"BlackRock may pay placement fees to dealers on purchases of Investor A and Investor P Shares of all","page_number":218,"box":{"x":117,"y":733,"width":759,"height":12}},{"id":"69ef6eb9-8f86-40b0-a28f-92c568143efa","block_type":"box","text":"Funds, which may depend on the policies, procedures and trading platforms of your financial","page_number":218,"box":{"x":117,"y":748,"width":685,"height":12}},{"id":"4ea59429-f546-41fc-9bdb-95b6999b4751","block_type":"box","text":"intermediary.","page_number":218,"box":{"x":117,"y":764,"width":94,"height":12}},{"id":"945c52c0-7080-433f-8111-2b5240356c45","block_type":"box","text":"Except as noted below, these placement fees may be up to the following amounts for Investor A","page_number":218,"box":{"x":117,"y":790,"width":712,"height":12}},{"id":"da7cd702-2894-4871-88fd-9e64116ecbf4","block_type":"box","text":"Shares:","page_number":218,"box":{"x":116,"y":805,"width":56,"height":10}},{"id":"3d62031b-4411-4762-a29d-4ba5e21dc74f","block_type":"box","text":"$1 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million","page_number":220,"box":{"x":150,"y":489,"width":260,"height":12}},{"id":"d5098a41-8daa-4da8-934c-c383d692ffcb","block_type":"box","text":"........","page_number":220,"box":{"x":417,"y":498,"width":65,"height":2}},{"id":"0db6787c-9fef-4519-8db9-b3caf7749092","block_type":"box","text":"0.50%","page_number":220,"box":{"x":484,"y":490,"width":51,"height":10}},{"id":"6221064b-1e0a-47cd-b4d7-3d39a175374d","block_type":"box","text":"$10 million and above","page_number":220,"box":{"x":150,"y":505,"width":168,"height":11}},{"id":"f6678fe1-c7f4-4b5f-9394-84b70ec800d8","block_type":"box","text":"...................","page_number":220,"box":{"x":319,"y":514,"width":163,"height":1}},{"id":"7e34e572-32fa-4597-b5a1-7ab7a51360ea","block_type":"box","text":"0.25%","page_number":220,"box":{"x":484,"y":506,"width":51,"height":9}},{"id":"82028ded-19b8-49f0-a868-e1662ef17b82","block_type":"box","text":"With respect to Investor A Shares of BlackRock Dynamic High Income Portfolio (for shares 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Fund,","page_number":220,"box":{"x":708,"y":692,"width":128,"height":11}},{"id":"fdffc05f-18e3-48d0-81e3-35967daee17a","block_type":"box","text":"BlackRock LifePath","page_number":220,"box":{"x":117,"y":707,"width":143,"height":10}},{"id":"72d683c5-ce82-4310-aa40-f41fa1fbdc86","block_type":"box","text":"®","page_number":220,"box":{"x":261,"y":706,"width":10,"height":7}},{"id":"5ffa072f-29d6-477c-80c0-7012a3618553","block_type":"box","text":"Index 2050 Fund, BlackRock LifePath","page_number":220,"box":{"x":277,"y":707,"width":279,"height":11}},{"id":"a6a6204b-4f31-4954-9be9-ccc702172a12","block_type":"box","text":"®","page_number":220,"box":{"x":557,"y":706,"width":9,"height":7}},{"id":"2c0a634a-d54d-4297-87b7-0afe43123ea4","block_type":"box","text":"Index 2055 Fund, BlackRock LifePath","page_number":220,"box":{"x":573,"y":707,"width":279,"height":11}},{"id":"bc8940ec-4c33-498b-86ef-ecb0a4b61bc3","block_type":"box","text":"®","page_number":220,"box":{"x":853,"y":706,"width":9,"height":7}},{"id":"e27c3d50-ffd8-47ba-b30c-f80cfe1f7572","block_type":"box","text":"Index 2060 Fund, BlackRock LifePath","page_number":220,"box":{"x":117,"y":723,"width":279,"height":11}},{"id":"2a14487d-69b0-4636-8d2d-2ffce0a7cb9e","block_type":"box","text":"®","page_number":220,"box":{"x":397,"y":722,"width":9,"height":7}},{"id":"e01716cc-22e4-4a18-9843-b4e6363944a5","block_type":"box","text":"Index 2065 Fund, BlackRock LifePath","page_number":220,"box":{"x":413,"y":723,"width":279,"height":11}},{"id":"4387a79f-f511-4f63-9a41-8f7f5cb323ba","block_type":"box","text":"®","page_number":220,"box":{"x":693,"y":722,"width":9,"height":7}},{"id":"2e34d500-0f19-4c4e-8b77-52370b6761e6","block_type":"box","text":"Index 2070 Fund and","page_number":220,"box":{"x":708,"y":723,"width":157,"height":9}},{"id":"3fd8ecf5-c914-4f4d-94dc-1012ac794653","block_type":"box","text":"BlackRock LifePath","page_number":220,"box":{"x":117,"y":738,"width":143,"height":10}},{"id":"8680f5db-52c4-4cb2-8996-04f5cf673ac3","block_type":"box","text":"®","page_number":220,"box":{"x":261,"y":737,"width":10,"height":7}},{"id":"3c676ec1-3e23-4f0c-8082-afe23f326459","block_type":"box","text":"Index Retirement Fund of BlackRock Funds III, the placement fees may be up to","page_number":220,"box":{"x":277,"y":738,"width":596,"height":12}},{"id":"e38491eb-ccbb-42c5-aeb9-c9c1de0ad532","block_type":"box","text":"the following amounts:","page_number":220,"box":{"x":116,"y":754,"width":166,"height":12}},{"id":"83d4f8a0-fe8d-4466-af52-6e9f78af8e64","block_type":"box","text":"$1,000,000 and above","page_number":220,"box":{"x":150,"y":784,"width":166,"height":12}},{"id":"0ef51908-490f-46d2-a8c6-b263fa68ea80","block_type":"box","text":"..................","page_number":220,"box":{"x":328,"y":793,"width":154,"height":1}},{"id":"eac29859-ced0-48d3-9315-c8738656719a","block_type":"box","text":"0.10%","page_number":220,"box":{"x":484,"y":785,"width":46,"height":9}},{"id":"6592712e-18c1-4590-9e40-60726fef922f","block_type":"box","text":"With respect to Investor P Shares of iShares Municipal Bond Index Fund of BlackRock Funds","page_number":220,"box":{"x":116,"y":816,"width":693,"height":12}},{"id":"571b3f9b-aad7-4aef-879f-07a5bffa0370","block_type":"box","text":"SM","page_number":220,"box":{"x":810,"y":816,"width":15,"height":6}},{"id":"b7511670-4d30-4f97-995e-64d76a6303af","block_type":"box","text":", the","page_number":220,"box":{"x":828,"y":816,"width":31,"height":11}},{"id":"5544a764-9526-4632-aede-5307348d8361","block_type":"box","text":"placement fees may be up to the following amounts:","page_number":220,"box":{"x":117,"y":831,"width":392,"height":12}},{"id":"ef91ff60-97df-43c0-884a-527b2b85b1c5","block_type":"box","text":"$1,000,000 and above","page_number":220,"box":{"x":150,"y":861,"width":172,"height":12}},{"id":"166fce82-319d-48c3-ad5c-d4183a777a12","block_type":"box","text":"..................","page_number":220,"box":{"x":328,"y":870,"width":154,"height":2}},{"id":"e1d163f0-23d0-4f3e-a21e-e0578fff1e28","block_type":"box","text":"0.15%","page_number":220,"box":{"x":484,"y":862,"width":51,"height":10}},{"id":"0bcbdb08-6e85-4764-b623-af4095dadcc2","block_type":"box","text":"II-133","page_number":220,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"8bd8676a-ef32-464d-8e9c-d16b16371c8c","block_type":"box","text":"NM1026U-6004382-220/605","page_number":220,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"2d0c3634-f220-4209-97d1-65d862ea0d13","block_type":"box","text":"There are no placement fees for Investor P Shares of iShares MSCI EAFE International Index Fund","page_number":221,"box":{"x":116,"y":87,"width":745,"height":12}},{"id":"12a50c12-15d4-41c9-9868-8c121c624157","block_type":"box","text":"and iShares Russell 2000 Small-Cap Index Fund of BlackRock Index Funds, Inc. and iShares S&P 500","page_number":221,"box":{"x":116,"y":102,"width":770,"height":12}},{"id":"f3c99688-513e-48e3-b405-0a48e900afdc","block_type":"box","text":"Index Fund and iShares U.S. Aggregate Bond Index Fund of BlackRock Funds III.","page_number":221,"box":{"x":117,"y":118,"width":612,"height":12}},{"id":"e1d8d495-9eb6-4dc1-8f9f-301eeaf1fd66","block_type":"box","text":"For the tables above, the placement fees indicated will apply up to the indicated breakpoint (so that, for","page_number":221,"box":{"x":117,"y":149,"width":769,"height":12}},{"id":"62df48c3-f18b-4478-a620-00ad524635fb","block_type":"box","text":"example, a sale of $4 million worth of Investor A Shares of BlackRock Impact Mortgage Fund of","page_number":221,"box":{"x":116,"y":164,"width":716,"height":13}},{"id":"7396837d-ae18-4e4a-a3d4-9982f26936cd","block_type":"box","text":"BlackRock Funds V will result in a placement fee of up to 0.50% on the first $3 million and a placement","page_number":221,"box":{"x":117,"y":179,"width":768,"height":13}},{"id":"1f365b0f-8271-4dbe-b936-abf8767af82f","block_type":"box","text":"fee of 0.25% on the final $1 million).","page_number":221,"box":{"x":116,"y":195,"width":272,"height":13}},{"id":"8b0424d0-7fa8-4f22-bdc5-1d4c6435616f","block_type":"box","text":"Other.","page_number":221,"box":{"x":117,"y":227,"width":44,"height":9}},{"id":"c00f234a-aae5-4cca-af3b-5d36d5b470db","block_type":"box","text":"The following persons may also buy Investor A or Investor P Shares without paying a sales","page_number":221,"box":{"x":163,"y":227,"width":685,"height":12}},{"id":"b79d053e-29fa-4c19-aafa-110f940fcdba","block_type":"box","text":"charge: (a) certain employer-sponsored retirement plans (for purposes of this waiver, employer","page_number":221,"box":{"x":116,"y":242,"width":710,"height":12}},{"id":"cbfe55bc-269c-42a6-bdb3-cfc91062de9a","block_type":"box","text":"sponsored retirement plans do not include SEP IRAs, SIMPLE IRAs or SARSEPs); (b) rollovers of","page_number":221,"box":{"x":116,"y":258,"width":733,"height":12}},{"id":"c917804b-5794-44cb-aa46-54920366087e","block_type":"box","text":"current investments through certain employer-sponsored retirement plans provided the shares are","page_number":221,"box":{"x":116,"y":273,"width":733,"height":12}},{"id":"a215f100-4a4c-4b6b-9b3d-e006c99043bb","block_type":"box","text":"transferred to Investor A or Investor P, as applicable, shares of the same or another BlackRock Fund","page_number":221,"box":{"x":116,"y":289,"width":754,"height":12}},{"id":"5a09371e-0f59-4b2a-ad22-00a12a9e2d59","block_type":"box","text":"as either a direct rollover, or subsequent to distribution, the rolled-over proceeds are contributed to a","page_number":221,"box":{"x":116,"y":304,"width":750,"height":12}},{"id":"cdcfdd8e-6355-41a1-8d5e-a272b498ee96","block_type":"box","text":"BlackRock IRA through an account directly with the Fund; or purchases by IRA programs that are","page_number":221,"box":{"x":117,"y":320,"width":728,"height":12}},{"id":"7881ef35-9c40-450f-ae32-bd7ae6d48404","block_type":"box","text":"sponsored by financial intermediary firms provided the financial intermediary firm has entered into a","page_number":221,"box":{"x":116,"y":335,"width":744,"height":12}},{"id":"ea8ce7e5-1628-475d-af59-38bf47e27af3","block_type":"box","text":"Class A or Investor P NAV agreement, as applicable, with respect to such program with the Distributor;","page_number":221,"box":{"x":117,"y":351,"width":768,"height":12}},{"id":"f91e5061-1726-4f01-b7b0-07f2ac6da39b","block_type":"box","text":"(c) insurance company separate accounts; (d) registered investment advisers, trust companies and","page_number":221,"box":{"x":117,"y":366,"width":740,"height":12}},{"id":"149b2fa7-b4bb-4aa6-b2c0-44173df07db1","block_type":"box","text":"bank trust departments exercising discretionary investment authority with respect to amounts to be","page_number":221,"box":{"x":117,"y":382,"width":736,"height":12}},{"id":"c7d2b90b-6175-4024-93a3-7eb00d86ce76","block_type":"box","text":"invested in a Fund; (e) persons participating in a fee-based program (such as a wrap account) under","page_number":221,"box":{"x":117,"y":397,"width":750,"height":12}},{"id":"685f5e82-ba28-4914-8128-2cf1d092a29b","block_type":"box","text":"which they pay advisory fees to a broker-dealer or other financial institution; (f) financial intermediaries","page_number":221,"box":{"x":116,"y":413,"width":764,"height":12}},{"id":"da158544-a11e-40b0-bcb5-6451982e8050","block_type":"box","text":"who have entered into an agreement with the Distributor and have been approved by the Distributor to","page_number":221,"box":{"x":116,"y":428,"width":764,"height":12}},{"id":"52e468e4-2b28-4e6b-a622-3c02cc8e2a12","block_type":"box","text":"offer Fund shares to self-directed investment brokerage accounts that may or may not charge a","page_number":221,"box":{"x":116,"y":444,"width":714,"height":12}},{"id":"73055aa8-88a8-453d-ba45-8fbb5ea49824","block_type":"box","text":"transaction fee; (g) state sponsored 529 college savings plans and rollovers of such 529 plans into","page_number":221,"box":{"x":116,"y":459,"width":736,"height":12}},{"id":"fe86b15f-de33-4424-882f-76a787ab29a4","block_type":"box","text":"Roth IRAs as permitted under the Internal Revenue Code; (h) with respect to Investor A Shares only,","page_number":221,"box":{"x":117,"y":475,"width":753,"height":12}},{"id":"b55f98f9-2137-4a54-aed6-1dcbeef6da07","block_type":"box","text":"accounts opened directly with a Fund that do not have a financial intermediary associated with the","page_number":221,"box":{"x":116,"y":490,"width":733,"height":12}},{"id":"a9dbb085-2bd8-4dd0-97c1-d955d1003acc","block_type":"box","text":"account; and (i) persons involuntarily liquidated from a Fund, who within 60 days of liquidation buy new","page_number":221,"box":{"x":116,"y":506,"width":769,"height":12}},{"id":"3b76442c-1eba-43b3-baaf-1f196926ed1e","block_type":"box","text":"shares of another BlackRock Fund (but only up to the amount that was liquidated). The following","page_number":221,"box":{"x":116,"y":521,"width":721,"height":12}},{"id":"9d051fcd-958d-4123-a6ce-117c75731915","block_type":"box","text":"persons associated with the Funds, the Fund’s Manager, Sub-Advisers, Transfer Agent, Distributor,","page_number":221,"box":{"x":117,"y":537,"width":743,"height":12}},{"id":"eeede672-4e95-48f2-a702-b29687db2550","block_type":"box","text":"fund accounting agents, Barclays PLC and their affiliates may buy Investor A or Investor P Shares of","page_number":221,"box":{"x":116,"y":552,"width":752,"height":12}},{"id":"f20777a7-cbc4-43f4-8399-fd8d4b84b3fe","block_type":"box","text":"each of the Funds without paying a sales charge to the extent permitted by these firms including:","page_number":221,"box":{"x":116,"y":568,"width":723,"height":12}},{"id":"443f6964-4eb9-47de-b5bd-fc33dd0940a4","block_type":"box","text":"(a) officers, directors and partners; (b) employees and retirees; (c) employees or registered","page_number":221,"box":{"x":117,"y":583,"width":680,"height":12}},{"id":"8e5dde54-3c91-404a-af19-574104ae5124","block_type":"box","text":"representatives of firms who have entered into selling agreements to distribute shares of BlackRock","page_number":221,"box":{"x":117,"y":599,"width":745,"height":12}},{"id":"1beae6df-7eb3-489f-a7b4-176a09d6c936","block_type":"box","text":"advised funds; (d) immediate family members of such persons (“immediate family members” shall be","page_number":221,"box":{"x":116,"y":614,"width":753,"height":12}},{"id":"8ea88d1e-7edd-40cf-9f54-5ec93adafcb7","block_type":"box","text":"defined as the investor, the investor’s spouse or domestic partner, children, parents and siblings); and","page_number":221,"box":{"x":116,"y":630,"width":761,"height":12}},{"id":"fb6f4b40-6e3e-4422-a29f-740a649c94d7","block_type":"box","text":"(e) any trust, pension, profit-sharing or other benefit plan for any of the persons set forth in (a) through","page_number":221,"box":{"x":117,"y":645,"width":762,"height":12}},{"id":"611c9bc2-2673-4bb5-9a37-e0b44da8b4a9","block_type":"box","text":"(d). Investors who qualify for any of these exemptions from the sales charge should purchase","page_number":221,"box":{"x":117,"y":661,"width":692,"height":12}},{"id":"e7d7f9d0-ed92-427d-9e72-7ed07578cc7b","block_type":"box","text":"Investor A or Investor P Shares. In addition, a sales charge waiver may be available for investors","page_number":221,"box":{"x":117,"y":676,"width":719,"height":12}},{"id":"03b37a19-7544-4866-978b-e91045c0445b","block_type":"box","text":"exchanging Investor A Shares of one BlackRock Fund for Investor P Shares of another BlackRock","page_number":221,"box":{"x":116,"y":692,"width":730,"height":12}},{"id":"441855a8-d053-4cc7-829a-d2430a0d770d","block_type":"box","text":"Fund, or exchanging Investor P Shares of one BlackRock Fund for Investor A Shares of another","page_number":221,"box":{"x":117,"y":707,"width":713,"height":12}},{"id":"5ec99088-9df1-43f4-9c38-29a301c5be8f","block_type":"box","text":"BlackRock Fund, through an intermediary-processed exchange, provided that the investor had","page_number":221,"box":{"x":117,"y":723,"width":699,"height":12}},{"id":"fd3aa818-4edf-4604-b33e-494b51a12f16","block_type":"box","text":"previously paid a sales charge with respect to such shares. The availability of Investor A or Investor P","page_number":221,"box":{"x":117,"y":738,"width":753,"height":12}},{"id":"9a972321-e84e-4e50-96b9-852177e82f96","block_type":"box","text":"Shares sales charge waivers may depend upon the policies, procedures and trading platforms of your","page_number":221,"box":{"x":116,"y":754,"width":756,"height":12}},{"id":"bb9f08f7-aa23-4167-a02a-6db08941267a","block_type":"box","text":"financial intermediary; consult your financial adviser.","page_number":221,"box":{"x":116,"y":769,"width":387,"height":12}},{"id":"821c28bd-a00a-40a6-88cd-e23670395bf0","block_type":"box","text":"If you invest $1,000,000 ($250,000 for BlackRock Dynamic High Income Portfolio, BlackRock Multi","page_number":221,"box":{"x":117,"y":799,"width":736,"height":13}},{"id":"77da9b1d-5fd8-492d-a415-fa7df1dab08b","block_type":"box","text":"Asset Income Portfolio and BlackRock Managed Income Fund of BlackRock Funds II, BlackRock","page_number":221,"box":{"x":116,"y":816,"width":720,"height":12}},{"id":"c823d4b7-436a-42ab-8a04-d408ca85b016","block_type":"box","text":"Credit Relative Value Fund of BlackRock Funds IV, BlackRock Total Return Fund of BlackRock Bond","page_number":221,"box":{"x":117,"y":831,"width":755,"height":11}},{"id":"f599bd32-b7fb-42c2-bbb9-36944e84a2d0","block_type":"box","text":"Fund, Inc., BlackRock Global Allocation Fund, Inc., BlackRock National Municipal Fund of BlackRock","page_number":221,"box":{"x":117,"y":847,"width":754,"height":12}},{"id":"2bf031ab-fbaf-4baf-90e0-439e175cb9fb","block_type":"box","text":"Municipal Bond Fund, Inc., BlackRock Short Duration Muni Fund of BlackRock Municipal Bond Fund,","page_number":221,"box":{"x":117,"y":862,"width":754,"height":12}},{"id":"d26b0999-c16f-4710-b867-1898ea23cd37","block_type":"box","text":"Inc., BlackRock Strategic Municipal Opportunities Fund of BlackRock Municipal Series Trust,","page_number":221,"box":{"x":117,"y":878,"width":693,"height":12}},{"id":"269df893-a32d-4999-bfec-c096c59d2541","block_type":"box","text":"II-134","page_number":221,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"c6738b3c-750f-421e-be36-234185836305","block_type":"box","text":"NM1026U-6004382-221/605","page_number":221,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"40c431bc-5a25-42d0-ae3f-95d021d98fdb","block_type":"box","text":"BlackRock California Municipal Opportunities Fund of BlackRock California Municipal Series Trust,","page_number":222,"box":{"x":117,"y":87,"width":736,"height":12}},{"id":"f2e07c84-d16f-40c9-9e37-f59dcbff65a5","block_type":"box","text":"BlackRock New York Municipal Opportunities Fund, BlackRock New Jersey Municipal Bond Fund and","page_number":222,"box":{"x":117,"y":102,"width":761,"height":13}},{"id":"e6ab73b3-5363-4124-958c-54d09059166e","block_type":"box","text":"BlackRock Pennsylvania Municipal Bond Fund of BlackRock Multi-State Municipal Series Trust,","page_number":222,"box":{"x":117,"y":118,"width":714,"height":12}},{"id":"ba4acac7-7896-4306-abd8-0155bc13212f","block_type":"box","text":"BlackRock Event Driven Equity Fund and BlackRock Balanced Fund, Inc., and $500,000 for BlackRock","page_number":222,"box":{"x":117,"y":133,"width":770,"height":13}},{"id":"c11fc463-8144-45b5-a2f1-954445ba53ae","block_type":"box","text":"Low Duration Bond Portfolio, BlackRock Floating Rate Income Portfolio, BlackRock Income Fund and","page_number":222,"box":{"x":117,"y":149,"width":757,"height":12}},{"id":"e0741272-c549-43b4-86d2-7e878d530945","block_type":"box","text":"BlackRock Strategic Income Opportunities Portfolio of BlackRock Funds V) or more in Investor A or","page_number":222,"box":{"x":117,"y":165,"width":742,"height":12}},{"id":"ab4791d3-b6d0-4b95-ae76-dba6c1896ad0","block_type":"box","text":"Investor P Shares, as applicable, you may not pay an initial sales charge. However, if you redeem your","page_number":222,"box":{"x":117,"y":180,"width":769,"height":12}},{"id":"0cf68d48-fd95-4765-9760-773ed5feeff3","block_type":"box","text":"Investor A or Investor P Shares, as applicable, within 18 months after purchase (a shorter holding","page_number":222,"box":{"x":117,"y":196,"width":729,"height":12}},{"id":"1865b7c0-429b-41f2-aa9e-c1be1a3571ee","block_type":"box","text":"period may apply depending on the Fund), you may be charged a deferred sales charge.","page_number":222,"box":{"x":117,"y":211,"width":663,"height":12}},{"id":"db2300a8-3a4f-4aba-86bb-9185d54f0fb4","block_type":"box","text":"A deferred sales charge of up to 1.00% may apply to certain redemptions of Investor A Shares of the","page_number":222,"box":{"x":116,"y":242,"width":753,"height":12}},{"id":"c0b513b2-65ee-4c80-9f92-d8994cb756d3","block_type":"box","text":"Index Funds and BlackRock Short Obligations Fund purchased in an exchange transaction for","page_number":222,"box":{"x":117,"y":258,"width":703,"height":12}},{"id":"40054659-4902-4246-be38-f8a21ba117fd","block_type":"box","text":"Investor A Shares of a portfolio advised by BlackRock or its affiliates where no initial sales charge was","page_number":222,"box":{"x":117,"y":273,"width":763,"height":12}},{"id":"064bb8d1-3394-49a2-9366-c6f1d9ad718f","block_type":"box","text":"paid at the time of purchase of such fund (an “Investor A Load-Waived BlackRock Portfolio”) as part of","page_number":222,"box":{"x":117,"y":289,"width":763,"height":12}},{"id":"2abf55ae-bb1f-4ffa-9cff-f31b558e09b6","block_type":"box","text":"an investment of $1,000,000 (lesser amounts may apply depending on the Investor A Load-Waived","page_number":222,"box":{"x":116,"y":303,"width":742,"height":13}},{"id":"3524de7f-2903-4fca-8d70-562bd6056127","block_type":"box","text":"BlackRock Portfolio) or more. The Investor A Shares deferred sales charge is only charged upon","page_number":222,"box":{"x":117,"y":320,"width":722,"height":12}},{"id":"6c5bed66-b6f9-4538-a64f-f0e32f2765b5","block_type":"box","text":"redemptions of Investor A Shares within 18 months after you originally acquired such Investor A","page_number":222,"box":{"x":117,"y":335,"width":716,"height":12}},{"id":"03e80698-1146-4454-955f-0d3efd6240d8","block_type":"box","text":"Shares of the Investor A Load-Waived BlackRock Portfolio (a shorter holding period may apply","page_number":222,"box":{"x":116,"y":351,"width":708,"height":12}},{"id":"73ea6fbb-30ff-4a3d-8315-3fb9e05319a5","block_type":"box","text":"depending on the Investor A Load-Waived BlackRock Portfolio), unless you qualify for a waiver. There","page_number":222,"box":{"x":116,"y":366,"width":763,"height":12}},{"id":"73bbd5f7-bc4d-498a-b1ae-1528f2b7523a","block_type":"box","text":"is no deferred sales charge charged on redemptions if you have owned your Investor A Shares for","page_number":222,"box":{"x":117,"y":382,"width":733,"height":12}},{"id":"b9416815-c1c7-420f-ab2f-20fc7bfa542b","block_type":"box","text":"more than 18 months (or for a shorter holding period, as applicable) (as measured from your original","page_number":222,"box":{"x":117,"y":397,"width":749,"height":12}},{"id":"012133a0-f151-4353-aa59-375e7c5967e6","block_type":"box","text":"purchase of Investor A Shares that you exchanged into Investor A Shares of the Index Fund or","page_number":222,"box":{"x":117,"y":413,"width":707,"height":12}},{"id":"971585a1-41aa-46f3-b2b9-552802f2f2c5","block_type":"box","text":"BlackRock Short Obligations Fund).","page_number":222,"box":{"x":117,"y":428,"width":270,"height":12}},{"id":"7610a2c1-b9d3-4477-829c-717b9842f8b8","block_type":"box","text":"The deferred sales charge on Investor A or Investor P Shares, as applicable, is not charged in connection","page_number":222,"box":{"x":116,"y":459,"width":764,"height":12}},{"id":"05359d75-dc3b-4654-a4a0-9ab663b89649","block_type":"box","text":"with: (a) redemptions of Investor A or Investor P Shares purchased through certain employer-sponsored","page_number":222,"box":{"x":116,"y":475,"width":752,"height":12}},{"id":"97d17a4c-06a4-4071-9c71-7f698257b009","block_type":"box","text":"retirement plans and rollovers of current investments in a Fund through such plans; (b) exchanges","page_number":222,"box":{"x":117,"y":490,"width":709,"height":12}},{"id":"04aec91e-efe7-43a2-bd02-edfc38c20332","block_type":"box","text":"described in “Exchange Privilege” below; (c) redemptions made in connection with minimum required","page_number":222,"box":{"x":116,"y":506,"width":730,"height":12}},{"id":"543d79d9-17c2-4750-8b4e-35ef16611004","block_type":"box","text":"distributions from IRA and 403(b)(7) accounts due to the shareholder reaching the applicable age","page_number":222,"box":{"x":116,"y":521,"width":704,"height":12}},{"id":"d6739a28-d526-4e0a-a312-092c4247fa25","block_type":"box","text":"triggering such distributions; (d) redemptions made with respect to certain retirement plans sponsored by a","page_number":222,"box":{"x":116,"y":537,"width":770,"height":12}},{"id":"4065fd7a-3590-45a7-941d-16acda740c48","block_type":"box","text":"Fund, BlackRock or its affiliates; (e) redemptions (i) within one year of a shareholder’s death or, if later, the","page_number":222,"box":{"x":117,"y":552,"width":768,"height":12}},{"id":"f30bcf56-864f-4b67-95f2-001bf3d41c5d","block_type":"box","text":"receipt of a certified probate settlement (including in connection with the distribution of account assets to a","page_number":222,"box":{"x":117,"y":568,"width":765,"height":12}},{"id":"2a8d4373-1257-439c-bd71-380215dd8df5","block_type":"box","text":"beneficiary of the decedent) or (ii) in connection with a shareholder’s disability (as defined in the Code)","page_number":222,"box":{"x":117,"y":583,"width":740,"height":12}},{"id":"93bfebc2-fe0d-4597-abb0-fcd34b6b9301","block_type":"box","text":"subsequent to the purchase of Investor A or Investor P Shares; (f) involuntary redemptions of Investor A or","page_number":222,"box":{"x":116,"y":599,"width":771,"height":12}},{"id":"ad5fcc92-1182-409e-b470-7a54d66ae733","block_type":"box","text":"Investor P Shares in accounts with low balances; (g) certain redemptions made pursuant to the","page_number":222,"box":{"x":117,"y":614,"width":687,"height":12}},{"id":"6542aa14-360a-479f-a0e7-1151c49b0a12","block_type":"box","text":"Systematic Withdrawal Plan (described below); (h) redemptions related to the payment of BNY Mellon","page_number":222,"box":{"x":116,"y":630,"width":738,"height":12}},{"id":"37682268-9c7a-4f6c-b5e2-a15d0981e053","block_type":"box","text":"Investment Servicing Trust Company custodial IRA fees; and (i) redemptions when a shareholder can","page_number":222,"box":{"x":117,"y":645,"width":734,"height":12}},{"id":"89ea6846-ebb4-46ff-a26e-b6778b1f55be","block_type":"box","text":"demonstrate hardship, in the absolute discretion of a Fund.","page_number":222,"box":{"x":116,"y":661,"width":423,"height":12}},{"id":"ac893cb4-c133-4317-ba12-8a91a1ee5aaf","block_type":"box","text":"With respect to certain employer-sponsored retirement plans, if a dealer waives its right to receive a","page_number":222,"box":{"x":116,"y":692,"width":740,"height":12}},{"id":"cfb720b6-77f4-48ab-a428-2dfc9ec18ac2","block_type":"box","text":"placement fee, the Fund may, at its own discretion, waive the CDSC related to purchases of","page_number":222,"box":{"x":117,"y":707,"width":683,"height":12}},{"id":"228234f6-0748-45fc-9fa2-74dee88c9d69","block_type":"box","text":"$1,000,000 ($250,000 for BlackRock Dynamic High Income Portfolio, BlackRock Multi-Asset Income","page_number":222,"box":{"x":116,"y":722,"width":745,"height":13}},{"id":"b201e915-0ede-465c-aeb2-96b675b4349e","block_type":"box","text":"Portfolio and BlackRock Managed Income Fund of BlackRock Funds II, BlackRock Credit Relative","page_number":222,"box":{"x":117,"y":738,"width":727,"height":12}},{"id":"d82c04a5-a7d9-4cd2-a88b-0c8a0ff9caa0","block_type":"box","text":"Value Fund of BlackRock Funds IV, BlackRock Total Return Fund of BlackRock Bond Fund, Inc.,","page_number":222,"box":{"x":116,"y":754,"width":719,"height":11}},{"id":"77fb3ef1-a647-4154-acc2-69d6351aca4c","block_type":"box","text":"BlackRock Global Allocation Fund, Inc., BlackRock National Municipal Fund of BlackRock Municipal","page_number":222,"box":{"x":117,"y":769,"width":740,"height":12}},{"id":"daf57e25-7a51-4773-8ac8-bf5a198eb553","block_type":"box","text":"Bond Fund, Inc., BlackRock Short Duration Muni Fund of BlackRock Municipal Bond Fund, Inc.,","page_number":222,"box":{"x":117,"y":785,"width":709,"height":12}},{"id":"b15b4a4e-f8bf-4b4b-a712-7265823c448e","block_type":"box","text":"BlackRock Strategic Municipal Opportunities Fund of BlackRock Municipal Series Trust, BlackRock","page_number":222,"box":{"x":117,"y":800,"width":736,"height":12}},{"id":"89d092cc-b6c4-4df2-adae-caa7b9c33222","block_type":"box","text":"California Municipal Opportunities Fund of BlackRock California Municipal Series Trust, BlackRock","page_number":222,"box":{"x":117,"y":816,"width":732,"height":12}},{"id":"c9a86f24-010b-435d-82d0-6b99548489bf","block_type":"box","text":"New York Municipal Opportunities Fund, BlackRock New Jersey Municipal Bond Fund and BlackRock","page_number":222,"box":{"x":117,"y":831,"width":761,"height":12}},{"id":"5967dbcc-6a1b-4d1b-ad7a-40eb2707a669","block_type":"box","text":"Pennsylvania Municipal Bond Fund of BlackRock Multi-State Municipal Series Trust, BlackRock Event","page_number":222,"box":{"x":117,"y":847,"width":762,"height":12}},{"id":"0fd68153-bc4a-489d-a745-67404356cfbd","block_type":"box","text":"Driven Equity Fund and BlackRock Balanced Fund, Inc., and $500,000 for BlackRock Low Duration","page_number":222,"box":{"x":117,"y":861,"width":742,"height":13}},{"id":"162cf9f3-5718-4cd8-a7d6-c1c1efc69323","block_type":"box","text":"Bond Portfolio, BlackRock Floating Rate Income Portfolio, BlackRock Income Fund and BlackRock","page_number":222,"box":{"x":117,"y":878,"width":738,"height":12}},{"id":"ee7c6968-fbe7-4218-992f-c3bb44a0beb2","block_type":"box","text":"II-135","page_number":222,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"d50f603a-07df-42c3-9291-8e6595784752","block_type":"box","text":"NM1026U-6004382-222/605","page_number":222,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"eb170877-6ddd-407f-b7cf-a09d31084a27","block_type":"box","text":"Strategic Income Opportunities Portfolio of BlackRock Funds V) or more of Investor A or Investor P","page_number":223,"box":{"x":116,"y":87,"width":740,"height":12}},{"id":"8478af2a-104a-4879-97a3-34f8e624966b","block_type":"box","text":"Shares. This may depend upon the policies, procedures and trading platforms of your financial","page_number":223,"box":{"x":116,"y":102,"width":706,"height":13}},{"id":"74b5585f-b6d3-4bc8-be61-6c87e0f0ea0e","block_type":"box","text":"intermediary; consult your financial adviser.","page_number":223,"box":{"x":117,"y":118,"width":326,"height":12}},{"id":"341cb2d3-5bc6-4b66-af92-07210ceb695d","block_type":"box","text":"Investor A and Investor P Shares are also available at NAV to investors that, for regulatory reasons,","page_number":223,"box":{"x":117,"y":149,"width":746,"height":12}},{"id":"39334cd1-bd72-417c-bf86-25f046f6b22c","block_type":"box","text":"are required to transfer investment positions from a foreign registered investment company advised by","page_number":223,"box":{"x":116,"y":165,"width":765,"height":12}},{"id":"836f651b-006e-40d4-80df-c285dc061821","block_type":"box","text":"BlackRock or its affiliates to a U.S. registered BlackRock-advised fund.","page_number":223,"box":{"x":117,"y":180,"width":530,"height":12}},{"id":"9aff7fcc-fc3d-464c-abd2-9ee130f98465","block_type":"box","text":"Acquisition of Certain Investment Companies.","page_number":223,"box":{"x":115,"y":211,"width":340,"height":12}},{"id":"0722d7dd-1878-44ae-86f6-cab1baa227ea","block_type":"box","text":"Investor A and Investor P Shares may be offered at NAV","page_number":223,"box":{"x":456,"y":211,"width":432,"height":12}},{"id":"8db092bc-7cc3-4ade-81d0-bbd9c5f9b9e9","block_type":"box","text":"in connection with the acquisition of the assets of, or merger or consolidation with, a personal holding","page_number":223,"box":{"x":117,"y":227,"width":755,"height":12}},{"id":"89ba3fda-2367-4664-a1d2-280c400b1eed","block_type":"box","text":"company or a public or private investment company.","page_number":223,"box":{"x":116,"y":242,"width":394,"height":12}},{"id":"8ac9f90e-0ac9-4ff9-b39d-ba166c07320e","block_type":"box","text":"Purchases Through Certain Financial Intermediaries.","page_number":223,"box":{"x":116,"y":273,"width":392,"height":12}},{"id":"2bc229d1-2466-4d49-87c3-8a9c4cf79cea","block_type":"box","text":"Reduced sales charges may be applicable for","page_number":223,"box":{"x":509,"y":273,"width":350,"height":12}},{"id":"07aed73a-1604-4164-ba6d-8de7be113be6","block_type":"box","text":"purchases of Investor A, Investor A1 or Investor P Shares of a Fund through certain financial advisers,","page_number":223,"box":{"x":117,"y":289,"width":764,"height":12}},{"id":"02d55bda-82fc-4417-aea0-8c910b5ba5b6","block_type":"box","text":"selected securities dealers and other financial intermediaries that meet and adhere to standards","page_number":223,"box":{"x":116,"y":304,"width":717,"height":10}},{"id":"d2e9ee3d-3c9a-4a9b-a520-ac87372d9178","block_type":"box","text":"established by the Manager from time to time.","page_number":223,"box":{"x":116,"y":320,"width":346,"height":12}},{"id":"dc7d9938-4740-4ff9-8908-e914714cc5a7","block_type":"box","text":"Deferred Sales Charge Alternative — Investor C Shares","page_number":223,"box":{"x":117,"y":351,"width":445,"height":12}},{"id":"05964d15-a567-482a-a91d-ac86a25cbbef","block_type":"box","text":"Investors choosing the deferred sales charge alternative should consider Investor C Shares if they are","page_number":223,"box":{"x":117,"y":374,"width":762,"height":12}},{"id":"dc996c62-f5fe-4655-b3a8-fa44ea0468d6","block_type":"box","text":"uncertain as to the length of time they intend to hold their assets in a Fund. If you select Investor C","page_number":223,"box":{"x":117,"y":389,"width":736,"height":12}},{"id":"cd77445e-81e3-4394-babd-92292d061739","block_type":"box","text":"Shares, you do not pay an initial sales charge at the time of purchase. A Fund will not accept a","page_number":223,"box":{"x":116,"y":405,"width":708,"height":12}},{"id":"a2ead0ba-469b-4342-aab9-1300167b7e1b","block_type":"box","text":"purchase order of $500,000 or more for Investor C Shares (may be lower on funds that have set a","page_number":223,"box":{"x":117,"y":420,"width":732,"height":12}},{"id":"6a96be6b-3be8-4915-bc3e-18fab58c4be4","block_type":"box","text":"lower breakpoint for NAV). Your financial intermediary may set a lower maximum for Investor C","page_number":223,"box":{"x":117,"y":436,"width":711,"height":12}},{"id":"986bb007-6ad5-4542-9919-43e2728f27c6","block_type":"box","text":"Shares.","page_number":223,"box":{"x":116,"y":451,"width":62,"height":10}},{"id":"187da1eb-d9ce-4e0a-b33a-852ce5dd8a80","block_type":"box","text":"Investor C Shares are not available in accounts opened or held directly with a Fund that do not have a","page_number":223,"box":{"x":117,"y":482,"width":762,"height":12}},{"id":"208e361e-8180-4ed4-89bf-0e16e946ab1a","block_type":"box","text":"financial intermediary associated with the account.","page_number":223,"box":{"x":116,"y":498,"width":379,"height":12}},{"id":"2b42d37c-54ef-47d1-b8c3-accaebb0a950","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":223,"box":{"x":117,"y":529,"width":700,"height":12}},{"id":"f47b83a7-fdc5-4997-8291-2bce94f9fe22","block_type":"box","text":"The deferred sales charge alternatives may be particularly appealing to investors who do not qualify for","page_number":223,"box":{"x":116,"y":560,"width":771,"height":12}},{"id":"64c0cdcc-98f0-4101-9b01-caa5d23d9ec2","block_type":"box","text":"the reduction in initial sales charges. CDSC shares are subject to ongoing service fees and distribution","page_number":223,"box":{"x":116,"y":575,"width":767,"height":12}},{"id":"07414c10-dd8f-4d55-a4db-ba1cc1852db7","block_type":"box","text":"fees; however, these fees potentially may be offset to the extent any return is realized on the additional","page_number":223,"box":{"x":116,"y":591,"width":769,"height":12}},{"id":"7f925097-0077-4398-b999-1ee510e94219","block_type":"box","text":"funds initially invested in CDSC shares.","page_number":223,"box":{"x":116,"y":606,"width":298,"height":12}},{"id":"a11517ee-b5c8-4a65-aa40-1f666cf0ae71","block_type":"box","text":"BlackRock compensates financial advisers and other financial intermediaries for selling CDSC shares","page_number":223,"box":{"x":117,"y":637,"width":758,"height":12}},{"id":"aaa2767d-e901-408a-baa0-6c2539c3ff21","block_type":"box","text":"at the time of purchase from its own funds. Proceeds from the CDSC and the distribution fee are paid","page_number":223,"box":{"x":116,"y":653,"width":757,"height":12}},{"id":"0c9a16e7-f385-48c9-85f4-669a9a2f9e7a","block_type":"box","text":"to the Distributor and are used by the Distributor to defray the expenses of securities dealers or other","page_number":223,"box":{"x":116,"y":668,"width":751,"height":12}},{"id":"660e3e6e-1543-47eb-9f5a-ce7323c7dccb","block_type":"box","text":"financial intermediaries related to providing distribution-related services to each Fund in connection","page_number":223,"box":{"x":116,"y":684,"width":735,"height":12}},{"id":"fd68212e-a3c5-4b14-96fd-6b9095fdcfa0","block_type":"box","text":"with the sale of the CDSC shares. The combination of the CDSC and the ongoing distribution fee","page_number":223,"box":{"x":116,"y":699,"width":719,"height":13}},{"id":"9340ca84-d1b2-4463-819c-d13b3ee525da","block_type":"box","text":"facilitates the ability of each Fund to sell the CDSC shares without a sales charge being deducted at","page_number":223,"box":{"x":116,"y":715,"width":743,"height":12}},{"id":"ed58ffae-4a55-4859-817c-1fe300b16a98","block_type":"box","text":"the time of purchase. See “Distribution and/or Shareholder Servicing Plans” below. Imposition of the","page_number":223,"box":{"x":116,"y":730,"width":742,"height":13}},{"id":"2ca8bbcd-49d0-41b5-a8e9-769438b142bb","block_type":"box","text":"CDSC and the distribution fee on CDSC shares is limited by FINRA (as defined below) asset-based","page_number":223,"box":{"x":117,"y":746,"width":737,"height":12}},{"id":"23ec029c-c6f8-46b8-a11a-ffafbc800d5d","block_type":"box","text":"sales charge rule. See “Limitations on the Payment of Deferred Sales Charges” below.","page_number":223,"box":{"x":116,"y":761,"width":642,"height":13}},{"id":"d7343f8d-067a-41be-ae86-d49acd627279","block_type":"box","text":"Dealers will generally immediately receive commissions equal to 1.00% of the Investor C Shares sold","page_number":223,"box":{"x":117,"y":792,"width":750,"height":13}},{"id":"9d4cd3d7-2d95-4dae-95b2-63e453324da5","block_type":"box","text":"by them plus ongoing fees under the Fund’s Distribution and Service Plan. Dealers may not receive a","page_number":223,"box":{"x":117,"y":808,"width":751,"height":12}},{"id":"467e2e7b-480d-4bfc-9c28-428b5b8e93e4","block_type":"box","text":"commission in connection with sales of Investor C Shares to certain employer-sponsored retirement","page_number":223,"box":{"x":116,"y":823,"width":741,"height":13}},{"id":"d3d21eda-d721-41c7-891e-a9ed96bb6115","block_type":"box","text":"plans sponsored by the Fund, BlackRock or its affiliates, but may receive fees under the Distribution","page_number":223,"box":{"x":117,"y":839,"width":746,"height":12}},{"id":"f671405f-a12f-4fd3-bbdb-16317830769c","block_type":"box","text":"and Service Plan. These commissions and payments may be different than the reallowances,","page_number":223,"box":{"x":116,"y":854,"width":699,"height":13}},{"id":"79893307-5b3e-4b3f-9bce-658b6b9f064a","block_type":"box","text":"placement fees and commissions paid to dealers in connection with sales of Investor A, Investor A1","page_number":223,"box":{"x":117,"y":870,"width":744,"height":12}},{"id":"bfc79045-9518-4929-a666-6a45937827fe","block_type":"box","text":"II-136","page_number":223,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"086a5211-0dbf-4ecd-9657-5fa132e52581","block_type":"box","text":"NM1026U-6004382-223/605","page_number":223,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"36599669-8101-47f4-a212-e6241079981a","block_type":"box","text":"and Investor P Shares. These may depend upon the policies, procedures and trading platforms of your","page_number":224,"box":{"x":116,"y":87,"width":768,"height":12}},{"id":"e399b479-6e70-4dd9-b8d4-e3a5c107ea7f","block_type":"box","text":"financial intermediary; consult your financial adviser.","page_number":224,"box":{"x":116,"y":102,"width":393,"height":13}},{"id":"b447ff59-5a2e-41ee-9e30-edb8701ba812","block_type":"box","text":"Each Fund has adopted an automatic conversion feature for Investor C Shares. Effective","page_number":224,"box":{"x":117,"y":131,"width":664,"height":12}},{"id":"b0ebebe8-58c1-4b2c-96a4-d8b770ba3207","block_type":"box","text":"November 23, 2020, Investor C Shares held for approximately eight years will be converted into","page_number":224,"box":{"x":117,"y":146,"width":714,"height":12}},{"id":"6bf55d23-5371-4af0-bc01-5d80c258615d","block_type":"box","text":"Investor A Shares, as set forth in each Fund’s Prospectus. In addition, accounts that do not have a","page_number":224,"box":{"x":117,"y":162,"width":736,"height":12}},{"id":"bcd89d50-0725-4a23-8586-88aeea43b4d5","block_type":"box","text":"financial intermediary associated with them are not eligible to hold Investor C Shares, and any Investor","page_number":224,"box":{"x":116,"y":177,"width":768,"height":12}},{"id":"04f6d388-1315-447b-af38-3c7ab8abf719","block_type":"box","text":"C Shares held in such accounts will be automatically converted to Investor A Shares.","page_number":224,"box":{"x":117,"y":193,"width":635,"height":12}},{"id":"b4575456-bd05-40bd-ba4c-78bc7a965297","block_type":"box","text":"Conversion of Investor C Shares to Investor A Shares","page_number":224,"box":{"x":117,"y":221,"width":404,"height":10}},{"id":"b51ca6bb-9e82-4f9c-bfd0-60e307048a55","block_type":"box","text":"Effective November 23, 2020 (the “Effective Date”), approximately eight years after purchase, Investor","page_number":224,"box":{"x":117,"y":243,"width":763,"height":12}},{"id":"df27c48c-554e-4a27-88bb-8ba315ee977b","block_type":"box","text":"C Shares of each Fund will convert automatically into Investor A Shares of that Fund (the “Investor","page_number":224,"box":{"x":117,"y":259,"width":736,"height":12}},{"id":"cb8f9630-3f17-4ac0-a734-9a61971e7491","block_type":"box","text":"C 8-Year Conversion”). Certain funds (the “Predecessor Funds”) were reorganized into new Funds (the","page_number":224,"box":{"x":117,"y":274,"width":770,"height":12}},{"id":"55b1d5a6-8da9-4e36-9f96-9e69c2a769db","block_type":"box","text":"“Successor Funds”) pursuant to reorganizations which occurred in September 2018. The holding","page_number":224,"box":{"x":116,"y":290,"width":722,"height":12}},{"id":"51fe4757-61b7-4bf6-afed-b070ef4dcfa4","block_type":"box","text":"period for Investor C Shares of Successor Funds includes the period such shares were held in the","page_number":224,"box":{"x":117,"y":305,"width":732,"height":12}},{"id":"65afb26b-b657-4f59-95f0-acc2b785fd84","block_type":"box","text":"respective Predecessor Fund. It is the financial intermediary’s responsibility to ensure that the","page_number":224,"box":{"x":117,"y":321,"width":699,"height":12}},{"id":"45d5861f-f043-4c08-b952-5497500ead91","block_type":"box","text":"shareholder is credited with the proper holding period. As of the Effective Date, certain financial","page_number":224,"box":{"x":116,"y":336,"width":713,"height":12}},{"id":"e8c532b1-f5eb-4c6c-802b-b1b4546ea7db","block_type":"box","text":"intermediaries, including group retirement recordkeeping platforms, may not have been tracking such","page_number":224,"box":{"x":117,"y":352,"width":755,"height":12}},{"id":"5f3f2f4c-026f-4a88-b02f-203449c31ef6","block_type":"box","text":"holding periods and therefore may not be able to process such conversions. In such instances,","page_number":224,"box":{"x":117,"y":367,"width":708,"height":12}},{"id":"4ff5389d-a6a0-4690-b1eb-59123210f706","block_type":"box","text":"Investor C Shares held as of the Effective Date will automatically convert to Investor A Shares","page_number":224,"box":{"x":117,"y":383,"width":702,"height":12}},{"id":"36c54aef-ac7b-4095-b91c-6c5228b4ae42","block_type":"box","text":"approximately eight years after the Effective Date. If, as of November 23, 2028 (eight years after the","page_number":224,"box":{"x":116,"y":398,"width":749,"height":12}},{"id":"a2cb48e1-3beb-4da9-8993-dfcebd0e556d","block_type":"box","text":"Effective Date), a financial intermediary has not implemented systems or procedures to track holding","page_number":224,"box":{"x":117,"y":414,"width":751,"height":12}},{"id":"7d7a4e91-94d0-40a5-bf54-649cbb557e2a","block_type":"box","text":"periods commencing from the Effective Date, shareholders holding Investor C Shares through such","page_number":224,"box":{"x":117,"y":429,"width":742,"height":12}},{"id":"62b7a17f-6918-437e-a720-ddf040f0d88a","block_type":"box","text":"financial intermediary will no longer be eligible to hold Investor C Shares and any such shares will","page_number":224,"box":{"x":116,"y":445,"width":729,"height":12}},{"id":"29a2ff4e-ef95-42ab-a1a1-a2a34bd4cd40","block_type":"box","text":"convert to Investor A Shares as soon as reasonably practicable after such date.","page_number":224,"box":{"x":116,"y":460,"width":597,"height":12}},{"id":"6186e609-673b-4806-8f56-b948e887bade","block_type":"box","text":"In addition, accounts that do not have a financial intermediary associated with them are not eligible to","page_number":224,"box":{"x":117,"y":489,"width":756,"height":12}},{"id":"ee1ba430-d87c-4a81-a763-4f59cd3cd478","block_type":"box","text":"hold Investor C Shares, and any Investor C Shares held in such accounts will be automatically","page_number":224,"box":{"x":117,"y":504,"width":704,"height":12}},{"id":"79da9fae-6b69-4536-bb07-bfc37ba6cd6b","block_type":"box","text":"converted into Investor A Shares (the “Investor C Direct Accounts Conversion” and together with the","page_number":224,"box":{"x":116,"y":520,"width":749,"height":12}},{"id":"1bc6698f-4087-4947-a6d8-4e21957e6e34","block_type":"box","text":"Investor C 8-Year Conversion, the “Investor C Conversions”).","page_number":224,"box":{"x":117,"y":535,"width":459,"height":12}},{"id":"9f63f428-0171-44ba-82de-81e4710d6af3","block_type":"box","text":"The Investor C Conversions will occur at least once each month (on the “Investor C Conversion Date”)","page_number":224,"box":{"x":116,"y":563,"width":765,"height":13}},{"id":"133b9de5-24c0-4957-95f3-f69b1951288e","block_type":"box","text":"on the basis of the relative NAV of the shares of the two applicable classes on the Investor C","page_number":224,"box":{"x":116,"y":579,"width":694,"height":12}},{"id":"57eddea8-0e90-43dc-84e7-82075f9e4906","block_type":"box","text":"Conversion Date, without the imposition of any sales load, fee or other charge. The Investor C","page_number":224,"box":{"x":117,"y":594,"width":702,"height":13}},{"id":"4c8cae8b-89fe-4e30-aab4-5fc4eb056da4","block_type":"box","text":"Conversions will not be deemed a purchase or sale of the shares for U.S. federal income tax purposes.","page_number":224,"box":{"x":117,"y":610,"width":770,"height":12}},{"id":"99f1639d-efb0-40dd-ba4a-b160d6406707","block_type":"box","text":"Shares acquired through reinvestment of dividends on Investor C Shares will also convert","page_number":224,"box":{"x":116,"y":625,"width":670,"height":13}},{"id":"3ce494c6-ba27-47f2-adca-d21e60ae86af","block_type":"box","text":"automatically to Investor A Shares, as set forth in each Fund’s Prospectus. The Investor C Conversion","page_number":224,"box":{"x":116,"y":641,"width":765,"height":12}},{"id":"995fc826-449d-44db-8035-513d545d7e4e","block_type":"box","text":"Date for dividend reinvestment shares will be calculated taking into account the length of time the","page_number":224,"box":{"x":117,"y":656,"width":726,"height":13}},{"id":"2e8e9f35-adab-4dc0-af74-75524e018334","block_type":"box","text":"shares underlying the dividend reinvestment shares were outstanding.","page_number":224,"box":{"x":116,"y":672,"width":520,"height":12}},{"id":"e8ba258c-fe0c-4d22-a5b5-1a4c7704e670","block_type":"box","text":"Contingent Deferred Sales Charge — Investor C Shares","page_number":224,"box":{"x":117,"y":700,"width":418,"height":12}},{"id":"bd15d989-ec8c-47ba-8d0b-14dc23315fa6","block_type":"box","text":"Investor C Shares that are redeemed within one year of purchase may be subject to a 1.00% CDSC","page_number":224,"box":{"x":117,"y":722,"width":741,"height":12}},{"id":"fe3c0c7b-fd10-4fbc-b872-09eafc4da805","block_type":"box","text":"charged as a percentage of the dollar amount subject thereto. In determining whether an Investor C","page_number":224,"box":{"x":116,"y":738,"width":739,"height":12}},{"id":"64100f1d-0a80-4aca-a9f7-ebe6d5d98217","block_type":"box","text":"Shares CDSC is applicable to a redemption, the calculation will be determined in the manner that","page_number":224,"box":{"x":116,"y":753,"width":722,"height":12}},{"id":"d27ff8d2-3043-474c-9e16-71ec539b43e7","block_type":"box","text":"results in the lowest possible rate being charged. The charge will be assessed on an amount equal to","page_number":224,"box":{"x":117,"y":769,"width":751,"height":12}},{"id":"cd558df2-255d-4843-aec5-b5b8b6b59037","block_type":"box","text":"the lesser of the proceeds of redemption or the cost of the shares being redeemed. Accordingly, no","page_number":224,"box":{"x":116,"y":784,"width":737,"height":12}},{"id":"3d96eb1f-4e15-4a36-9481-e2b585467b0f","block_type":"box","text":"CDSC will be imposed on increases in NAV above the initial purchase price of Investor C Shares. In","page_number":224,"box":{"x":117,"y":800,"width":740,"height":12}},{"id":"f5334fa9-13db-4bb4-908b-aad751e0ede6","block_type":"box","text":"addition, no CDSC will be assessed on Investor C Shares acquired through reinvestment of dividends.","page_number":224,"box":{"x":116,"y":815,"width":759,"height":12}},{"id":"7383c2b1-143d-402a-b414-4f807c91f213","block_type":"box","text":"It will be assumed that the redemption is first of shares held for over one year or shares acquired","page_number":224,"box":{"x":117,"y":831,"width":722,"height":12}},{"id":"7c8cf99a-c170-4d8d-bbc0-b14332b90164","block_type":"box","text":"pursuant to reinvestment of dividends and then of shares held longest during the one-year period. A","page_number":224,"box":{"x":117,"y":846,"width":745,"height":12}},{"id":"d3e687f1-832e-489e-90d3-da6fbac73d64","block_type":"box","text":"transfer of shares from a shareholder’s account to another account will be assumed to be made in the","page_number":224,"box":{"x":116,"y":862,"width":761,"height":9}},{"id":"54140553-d332-4e52-ba97-824b3c239ebc","block_type":"box","text":"same order as a redemption.","page_number":224,"box":{"x":116,"y":877,"width":220,"height":12}},{"id":"28316184-bd62-48f9-9360-7064cd09b046","block_type":"box","text":"II-137","page_number":224,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"a059c8ce-b434-4ad2-818f-6839a5779109","block_type":"box","text":"NM1026U-6004382-224/605","page_number":224,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"e4b91887-d812-489f-8035-b4cb2f121849","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Part I of each Fund’s SAI for","page_number":225,"box":{"x":116,"y":87,"width":770,"height":12}},{"id":"f00f3cff-3f43-4504-9329-11fe07a5bbf8","block_type":"box","text":"information about amounts paid to the Distributor in connection with CDSC shares for the periods","page_number":225,"box":{"x":117,"y":102,"width":726,"height":12}},{"id":"f4fe0469-352b-4054-885b-e847b5f7605c","block_type":"box","text":"indicated.","page_number":225,"box":{"x":117,"y":118,"width":75,"height":10}},{"id":"4ff1ef23-2e70-4e10-bcad-5b5746fb9186","block_type":"box","text":"Investor C Shares — Contingent Deferred Sales Charge Waivers and Reductions","page_number":225,"box":{"x":117,"y":149,"width":610,"height":12}},{"id":"a88f3443-6a72-4dbe-8da2-d364f47a1294","block_type":"box","text":"The CDSC on Investor C Shares is not charged in connection with: (1) redemptions of Investor C","page_number":225,"box":{"x":116,"y":172,"width":725,"height":12}},{"id":"994d4e06-73c2-46c5-a3fe-cc3485810ee3","block_type":"box","text":"Shares purchased through certain employer-sponsored retirement plans and fee-based programs","page_number":225,"box":{"x":116,"y":188,"width":729,"height":12}},{"id":"de28d387-7bd0-4e96-80ab-65c067b21f68","block_type":"box","text":"previously approved by certain Funds and rollovers of current investments in the Fund through such","page_number":225,"box":{"x":117,"y":203,"width":745,"height":12}},{"id":"6ebaa906-e817-473c-808d-aef46a058918","block_type":"box","text":"plans; (2) exchanges described in “Exchange Privilege” below; (3) redemptions made in connection","page_number":225,"box":{"x":117,"y":219,"width":741,"height":12}},{"id":"4aaffe0e-0a66-477a-a194-8a226d74e8b4","block_type":"box","text":"with minimum required distributions due to the shareholder reaching age 72 from IRA and 403(b)(7)","page_number":225,"box":{"x":116,"y":234,"width":744,"height":12}},{"id":"2429ab35-819e-4c63-a900-ce797c58a13c","block_type":"box","text":"accounts; (4) redemptions made with respect to certain retirement plans sponsored by the Fund,","page_number":225,"box":{"x":116,"y":250,"width":721,"height":12}},{"id":"7f94230d-ad0c-433a-805c-ad1b2eb5ec95","block_type":"box","text":"BlackRock or its affiliates; (5) redemptions in connection with a shareholder’s death as long as the","page_number":225,"box":{"x":117,"y":265,"width":732,"height":12}},{"id":"bb0fa70d-5afb-4cad-b9a4-7233af53a81a","block_type":"box","text":"waiver request is made within one year of death or, if later, reasonably promptly following completion of","page_number":225,"box":{"x":116,"y":281,"width":772,"height":12}},{"id":"40ee0bc1-2203-470d-a846-1f501bc7dba8","block_type":"box","text":"probate (including in connection with the distribution of account assets to a beneficiary of the decedent)","page_number":225,"box":{"x":117,"y":296,"width":771,"height":12}},{"id":"503d8065-3eb5-405e-80a0-b78d315e19e7","block_type":"box","text":"or disability (as defined in the Code) subsequent to the purchase of Investor C Shares; (6) withdrawals","page_number":225,"box":{"x":116,"y":312,"width":766,"height":12}},{"id":"bf8979bc-797e-4673-9571-c504f4e11e56","block_type":"box","text":"resulting from shareholder disability (as defined in the Code) as long as the disability arose subsequent","page_number":225,"box":{"x":117,"y":327,"width":770,"height":12}},{"id":"20683b0b-d22b-4b29-80a1-8c3cf2e02216","block_type":"box","text":"to the purchase of the shares; (7) involuntary redemptions of Investor C Shares in accounts with low","page_number":225,"box":{"x":116,"y":343,"width":749,"height":12}},{"id":"3f71dee9-ff8a-497e-93fb-9ab0af409ec0","block_type":"box","text":"balances as described in “Redemption of Shares” below; (8) redemptions made pursuant to a","page_number":225,"box":{"x":117,"y":358,"width":698,"height":12}},{"id":"1c4c5574-cdf6-495e-9d17-34d8da012b86","block_type":"box","text":"systematic withdrawal plan, subject to the limitations set forth under “Systematic Withdrawal Plan”","page_number":225,"box":{"x":116,"y":374,"width":731,"height":12}},{"id":"b4389d32-c30f-462c-99ac-53773d8a78b4","block_type":"box","text":"below; (9) redemptions related to the payment of BNY Mellon Investment Servicing Trust Company","page_number":225,"box":{"x":117,"y":389,"width":740,"height":12}},{"id":"0195ac72-a402-4af4-b90f-8321f6a1ce54","block_type":"box","text":"custodial IRA fees; and (10) redemptions when a shareholder can demonstrate hardship, in the","page_number":225,"box":{"x":116,"y":405,"width":712,"height":12}},{"id":"ebcb4a38-8ae7-4681-818a-8c9db90a1aa8","block_type":"box","text":"absolute discretion of the Fund. In addition, no CDSC is charged on Investor C Shares acquired","page_number":225,"box":{"x":116,"y":420,"width":716,"height":12}},{"id":"d53d9080-01e8-48a9-8e76-7eaab9369e84","block_type":"box","text":"through the reinvestment of dividends or distributions.","page_number":225,"box":{"x":116,"y":436,"width":404,"height":12}},{"id":"b4b32cee-e4f8-4ca4-a392-36ccb6e74e50","block_type":"box","text":"Certain CDSC waivers and reductions on Investor C Shares may be available to customers of certain","page_number":225,"box":{"x":117,"y":467,"width":756,"height":12}},{"id":"f03d4a3b-c673-42f9-9071-0cfcfde261e7","block_type":"box","text":"financial intermediaries, as described under “Intermediary-Defined Sales Charge Waiver Policies” in","page_number":225,"box":{"x":116,"y":482,"width":746,"height":12}},{"id":"b1280390-aaf9-4136-8abd-68a6eef1ada3","block_type":"box","text":"the Fund’s Prospectus. Please speak to your financial intermediary for more information.","page_number":225,"box":{"x":116,"y":498,"width":662,"height":12}},{"id":"5c6f09f2-2f3d-4006-88d2-b4fe172603ca","block_type":"box","text":"Class R Shares","page_number":225,"box":{"x":116,"y":529,"width":127,"height":9}},{"id":"5d627268-9dfd-4e0e-819d-d686af51565b","block_type":"box","text":"Certain of the Funds offer Class R Shares as described in each such Fund’s Prospectus. Class R","page_number":225,"box":{"x":117,"y":552,"width":727,"height":12}},{"id":"b70ecae9-23d1-4596-b437-cd65d451a757","block_type":"box","text":"Shares are available only to certain employer-sponsored retirement plans. Class R Shares are not","page_number":225,"box":{"x":116,"y":568,"width":734,"height":12}},{"id":"44ae088b-bec2-4420-9f70-22714eb14984","block_type":"box","text":"subject to an initial sales charge or a CDSC but are subject to an ongoing distribution fee of 0.25% per","page_number":225,"box":{"x":116,"y":583,"width":765,"height":12}},{"id":"259a73b5-e679-466f-8135-b1a2f1dc4c38","block_type":"box","text":"year and an ongoing service fee of 0.25% per year. Distribution fees are used to support the Fund’s","page_number":225,"box":{"x":116,"y":599,"width":745,"height":12}},{"id":"7b52b20d-c038-4988-b986-3d6e63338a85","block_type":"box","text":"marketing and distribution efforts, such as compensating financial advisers and other financial","page_number":225,"box":{"x":117,"y":614,"width":700,"height":12}},{"id":"7dde9582-fd8d-41fd-9818-7a3f2c2ec837","block_type":"box","text":"intermediaries, advertising and promotion. Service fees are used to compensate securities dealers and","page_number":225,"box":{"x":117,"y":630,"width":768,"height":12}},{"id":"bae4e904-44c7-456f-aea2-f6ff93cf7538","block_type":"box","text":"other financial intermediaries for service activities.","page_number":225,"box":{"x":116,"y":645,"width":376,"height":10}},{"id":"8258bc4d-ff05-4f66-afbd-b4c0c7dab386","block_type":"box","text":"If Class R Shares are held over time, these","page_number":225,"box":{"x":117,"y":676,"width":319,"height":11}},{"id":"dcf3c530-8f88-4103-8b63-284d5235d2e8","block_type":"box","text":"fees may exceed the maximum sales charge that an","page_number":225,"box":{"x":442,"y":676,"width":388,"height":12}},{"id":"6f4a0551-e2ea-4e05-a742-98924fafa652","block_type":"box","text":"investor would have paid as a shareholder of one of the other share classes.","page_number":225,"box":{"x":117,"y":692,"width":566,"height":12}},{"id":"bec5b822-b548-4eb0-8b45-658133763409","block_type":"box","text":"Class K Shares","page_number":225,"box":{"x":116,"y":723,"width":122,"height":9}},{"id":"4d891647-f3da-4299-acf6-d7d93187777c","block_type":"box","text":"Certain Funds offer Class K Shares as described in each such Fund’s Prospectus. Class K Shares are","page_number":225,"box":{"x":117,"y":746,"width":761,"height":12}},{"id":"173607fd-6caf-41f8-bf89-76c33e3126d5","block_type":"box","text":"available only to (i) certain employee benefit plans, such as health savings accounts, and certain","page_number":225,"box":{"x":116,"y":761,"width":716,"height":13}},{"id":"fac06f6a-cf48-4ee8-b3ab-770c6d8270c6","block_type":"box","text":"employer-sponsored retirement plans (not including SEP IRAs, SIMPLE IRAs and SARSEPs)","page_number":225,"box":{"x":116,"y":777,"width":694,"height":12}},{"id":"a776896f-9a6c-4936-a851-31a9cbb65455","block_type":"box","text":"(collectively, “Employer-Sponsored Retirement Plans”), (ii) collective trust funds, investment companies","page_number":225,"box":{"x":117,"y":792,"width":765,"height":13}},{"id":"2152169b-c7ea-403d-9de2-8e077a22c767","block_type":"box","text":"and other pooled investment vehicles, each of which may purchase shares of the Fund through a","page_number":225,"box":{"x":116,"y":808,"width":720,"height":12}},{"id":"281f353f-3591-4164-95c2-280a769b1615","block_type":"box","text":"financial intermediary that has entered into an agreement with the Distributor to purchase such shares,","page_number":225,"box":{"x":116,"y":823,"width":761,"height":13}},{"id":"3affa7ee-3412-48c0-9bfa-30b83b075bcc","block_type":"box","text":"(iii) “Institutional Investors,” which include but are not limited to, endowments, foundations, family","page_number":225,"box":{"x":117,"y":839,"width":722,"height":12}},{"id":"a8f15e67-f30b-4be2-903c-94dcd57dfee6","block_type":"box","text":"offices, banks and bank trusts, local, city, and state governmental institutions, corporations and","page_number":225,"box":{"x":116,"y":854,"width":710,"height":13}},{"id":"b81bb748-631d-4926-a400-9d3ba688f072","block_type":"box","text":"insurance company separate accounts, each of which may purchase shares of the Fund through a","page_number":225,"box":{"x":117,"y":870,"width":735,"height":12}},{"id":"0c5ac881-8738-44bc-aa57-6c2aa87ebdbb","block_type":"box","text":"II-138","page_number":225,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"e22f7f36-c1c2-4fa3-974b-cf7ae4d29685","block_type":"box","text":"NM1026U-6004382-225/605","page_number":225,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"2459971e-5076-41aa-86ee-1cc871dfb7e8","block_type":"box","text":"financial intermediary that has entered into an agreement with the Distributor to purchase such shares,","page_number":226,"box":{"x":116,"y":87,"width":767,"height":12}},{"id":"e5f4aa4b-e880-45e0-b7d3-93822cf0a121","block_type":"box","text":"(iv) clients of private banks that purchase shares of the Fund through a financial intermediary that has","page_number":226,"box":{"x":117,"y":102,"width":759,"height":13}},{"id":"3173b8c6-9896-4ff8-85af-7b4ad003440e","block_type":"box","text":"entered into an agreement with the Distributor to sell such shares; (v) fee-based advisory platforms of","page_number":226,"box":{"x":116,"y":118,"width":759,"height":12}},{"id":"451bfbcb-29bd-408e-8865-1e965e1bec3d","block_type":"box","text":"a financial intermediary that (a) has specifically acknowledged in a written agreement with the","page_number":226,"box":{"x":116,"y":134,"width":699,"height":12}},{"id":"64c648fa-091a-4c8a-a4c8-59a43da51b7c","block_type":"box","text":"Distributor and/or its affiliate(s) that the financial intermediary shall offer such shares to fee-based","page_number":226,"box":{"x":117,"y":149,"width":728,"height":12}},{"id":"3bf3fb54-5218-46bd-b31d-4c65179eb4ce","block_type":"box","text":"advisory clients through an omnibus account held at the Fund or (b) transacts in the Fund’s shares","page_number":226,"box":{"x":116,"y":165,"width":737,"height":12}},{"id":"b15c540f-2b7a-4e3d-98b3-6af15d5b6ff4","block_type":"box","text":"through another intermediary that has executed such an agreement and (vi) any other investors who","page_number":226,"box":{"x":116,"y":180,"width":750,"height":12}},{"id":"09e52f65-6a9f-4e7b-a111-fa25ffef2e5b","block_type":"box","text":"met the eligibility criteria for BlackRock Shares or Class K Shares prior to August 15, 2016 and have","page_number":226,"box":{"x":117,"y":196,"width":748,"height":12}},{"id":"82cef1a2-5d3f-43bc-aaae-e23c1025ba48","block_type":"box","text":"continually held Class K Shares of the Fund or the respective Predecessor Fund in the same account","page_number":226,"box":{"x":116,"y":211,"width":757,"height":12}},{"id":"49eda303-604d-4456-a65b-1cdcab77ade8","block_type":"box","text":"since August 15, 2016. The agreement referenced in (iv) above shall appear in a supplemental","page_number":226,"box":{"x":116,"y":227,"width":709,"height":12}},{"id":"c79bcb22-48b4-47b0-913e-b1ec19a7eeea","block_type":"box","text":"agreement to any selling, sub-transfer agent, or distribution and marketing agreement.","page_number":226,"box":{"x":116,"y":242,"width":645,"height":12}},{"id":"0a7596e4-0e77-42db-8fb2-8a7feba0cdb5","block_type":"box","text":"Class K Shares are also available to employees, officers and directors/trustees of BlackRock, Inc. and","page_number":226,"box":{"x":117,"y":271,"width":762,"height":12}},{"id":"0e8312c2-3b1e-4b2a-85d2-dd81cf892473","block_type":"box","text":"BlackRock Funds and immediate family members of such persons, if they open an account directly","page_number":226,"box":{"x":117,"y":287,"width":738,"height":12}},{"id":"98046dca-7832-4733-8011-bf546cd5d930","block_type":"box","text":"with BlackRock. Eligible individuals who would like to convert existing holdings to Class K Shares must","page_number":226,"box":{"x":116,"y":302,"width":767,"height":12}},{"id":"cf4a79cf-6c7e-4e77-9269-a563e680fe8e","block_type":"box","text":"contact BlackRock.","page_number":226,"box":{"x":116,"y":318,"width":148,"height":9}},{"id":"0e775296-bdc0-4f23-9478-7eba1f6baff0","block_type":"box","text":"Class G Shares","page_number":226,"box":{"x":116,"y":347,"width":128,"height":10}},{"id":"b28b8099-1045-4ab0-ba9b-374fe87c1ae9","block_type":"box","text":"Certain Funds offer Class G Shares, which are available only to investors on eligible platforms. Eligible","page_number":226,"box":{"x":117,"y":369,"width":767,"height":13}},{"id":"f6eda0d1-2b68-462a-926b-09aabd63d155","block_type":"box","text":"platforms are those where clients invest in the Fund through a single omnibus account in the name of a","page_number":226,"box":{"x":117,"y":385,"width":770,"height":12}},{"id":"4ce7f535-5154-452f-8129-e3e45a3edbe2","block_type":"box","text":"financial intermediary that meets an initial investment minimum of $2 billion. For clients investing","page_number":226,"box":{"x":116,"y":400,"width":720,"height":13}},{"id":"f980b9f9-696d-465a-b567-ce1feec473fd","block_type":"box","text":"through such eligible platforms, the Fund does not impose investment minimums on any individual","page_number":226,"box":{"x":116,"y":416,"width":734,"height":12}},{"id":"63674dc5-1d46-40c6-8656-18e1fbfe8929","block_type":"box","text":"investor. Financial intermediaries may impose separate eligibility requirements.","page_number":226,"box":{"x":117,"y":432,"width":591,"height":12}},{"id":"6a493ab5-4a1b-4ef3-9729-5d72e75a0401","block_type":"box","text":"Service Shares","page_number":226,"box":{"x":116,"y":461,"width":125,"height":9}},{"id":"9c5d525f-44a2-444c-bb88-a88aca75d55a","block_type":"box","text":"Certain Funds offer Service Shares, which are available only to certain investors, including: (i) certain","page_number":226,"box":{"x":117,"y":483,"width":755,"height":12}},{"id":"286f7777-053e-436f-b421-004dec9ea7a5","block_type":"box","text":"financial institutions, such as banks and brokerage firms, acting on behalf of their customers; (ii) certain","page_number":226,"box":{"x":116,"y":499,"width":772,"height":12}},{"id":"080d19d9-473c-4027-b135-2ed5fa588e51","block_type":"box","text":"persons who were shareholders of the Compass Capital Group of Funds at the time of its combination","page_number":226,"box":{"x":117,"y":514,"width":762,"height":12}},{"id":"c5644472-7f51-47c7-b04c-28a0cf6745df","block_type":"box","text":"with The PNC","page_number":226,"box":{"x":116,"y":530,"width":103,"height":9}},{"id":"9b3148d1-7fe2-4b88-a260-daf8c845371f","block_type":"box","text":"®","page_number":226,"box":{"x":219,"y":529,"width":10,"height":7}},{"id":"465de637-1f53-41a9-acce-a6602b24bfc3","block_type":"box","text":"Fund in 1996; and (iii) participants in the Capital Directions","page_number":226,"box":{"x":229,"y":530,"width":440,"height":12}},{"id":"4b8782bb-74a7-4c29-bdda-a99673b62f6f","block_type":"box","text":"SM","page_number":226,"box":{"x":670,"y":530,"width":15,"height":6}},{"id":"9d0f50cd-58ec-4b59-9465-f21cb68d888a","block_type":"box","text":"asset allocation program.","page_number":226,"box":{"x":686,"y":530,"width":197,"height":12}},{"id":"ed790aa0-f3f9-4ce4-8ef5-60fa2e9c3998","block_type":"box","text":"Service Shares are not subject to an initial sales charge or a CDSC but are subject to an ongoing","page_number":226,"box":{"x":116,"y":545,"width":727,"height":12}},{"id":"6d776849-9246-4210-b36f-cd75da288158","block_type":"box","text":"service fee as set forth in the applicable Fund’s Prospectus.","page_number":226,"box":{"x":116,"y":561,"width":449,"height":12}},{"id":"e0590b6a-7e42-4b38-b9c0-6404f6be24ad","block_type":"box","text":"BlackRock Shares","page_number":226,"box":{"x":117,"y":590,"width":150,"height":9}},{"id":"a954d2a6-4b71-463f-81ad-14184117c7a3","block_type":"box","text":"Certain Funds offer BlackRock Shares, which are available only to certain investors. BlackRock Shares","page_number":226,"box":{"x":117,"y":612,"width":770,"height":12}},{"id":"e47b8e4e-ba36-4f9a-a428-a7c14dc809ee","block_type":"box","text":"are offered without a sales charge to institutional and individual investors, registered investment","page_number":226,"box":{"x":116,"y":628,"width":715,"height":12}},{"id":"ca9db3fc-9281-4a01-b056-137d563ecde9","block_type":"box","text":"advisers and certain fee-based programs.","page_number":226,"box":{"x":116,"y":643,"width":315,"height":12}},{"id":"bedaa3d5-8235-4760-a6e4-eab5bef1c527","block_type":"box","text":"Distribution and/or Shareholder Servicing Plans","page_number":226,"box":{"x":117,"y":672,"width":382,"height":13}},{"id":"f443fb0e-6539-4c5b-be9a-89a151060f5f","block_type":"box","text":"Each Fund has adopted a plan (each, a “Plan”) pursuant to Rule 12b-1 under the Investment Company","page_number":226,"box":{"x":117,"y":695,"width":764,"height":12}},{"id":"fabd70c4-8109-4a4c-b8f4-31f84fb72bab","block_type":"box","text":"Act with respect to certain share classes that allows the Fund to pay distribution fees for the sale of its","page_number":226,"box":{"x":116,"y":710,"width":756,"height":12}},{"id":"c6623c62-51bd-47d6-bb20-d223d8563c42","block_type":"box","text":"shares and shareholder servicing fees for certain services provided to its shareholders.","page_number":226,"box":{"x":116,"y":726,"width":645,"height":12}},{"id":"68d24876-9e8b-4d67-be49-8299b9ec5138","block_type":"box","text":"Pursuant to the Plans, a Fund may pay BRIL and/or BlackRock, or any other affiliate or significant","page_number":226,"box":{"x":117,"y":755,"width":725,"height":12}},{"id":"e5df9d7e-486c-4d14-ad83-488eaaaedf8b","block_type":"box","text":"shareholder of BlackRock, fees for distribution and sales support services with respect to Investor A,","page_number":226,"box":{"x":116,"y":771,"width":744,"height":12}},{"id":"03053f71-0725-45f3-b207-83a61fba1693","block_type":"box","text":"Investor A1, Investor C, Investor P, Service and Class R Shares. Currently, as described further below,","page_number":226,"box":{"x":117,"y":786,"width":763,"height":12}},{"id":"99a151c9-79f7-48b8-a260-69517e014aaa","block_type":"box","text":"only Investor C and Class R Shares bear the expense of distribution fees under a Plan.","page_number":226,"box":{"x":116,"y":802,"width":646,"height":12}},{"id":"39adf0cd-54d2-44e1-948b-de9d13372597","block_type":"box","text":"Each Fund has entered into a distribution agreement with BRIL under which BRIL, as agent, offers","page_number":226,"box":{"x":117,"y":831,"width":735,"height":12}},{"id":"2decb6a1-d175-4ae0-9c44-af9fdd3de499","block_type":"box","text":"shares of each Fund on a continuous basis. BRIL has agreed to use appropriate efforts to effect sales","page_number":226,"box":{"x":116,"y":846,"width":762,"height":12}},{"id":"dacee7ff-1dc1-47c3-9966-b43840e71afb","block_type":"box","text":"of the shares, but it is not obligated to sell any particular amount of shares. BRIL’s principal business","page_number":226,"box":{"x":116,"y":862,"width":752,"height":12}},{"id":"01331e47-74f8-4997-b0a4-b529952c53fb","block_type":"box","text":"address is 50 Hudson Yards, New York, NY 10001. BRIL is an affiliate of BlackRock.","page_number":226,"box":{"x":116,"y":877,"width":635,"height":12}},{"id":"faf07b89-0af2-44b5-8f0e-b28b2e3d2a37","block_type":"box","text":"II-139","page_number":226,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"b582f93a-b981-45bb-8fdc-ec63db87821c","block_type":"box","text":"NM1026U-6004382-226/605","page_number":226,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ac000e01-de85-4910-a439-89eae8a36347","block_type":"box","text":"Pursuant to the Plans, each Fund may also pay shareholder servicing fees (also referred to as general","page_number":227,"box":{"x":117,"y":87,"width":765,"height":12}},{"id":"c006cf89-bce7-4423-aab1-508aeeae1313","block_type":"box","text":"shareholder liaison services fees) to affiliated and unaffiliated brokers, dealers, financial institutions,","page_number":227,"box":{"x":116,"y":102,"width":744,"height":13}},{"id":"6cc46033-635f-46b2-8db1-d258a0d510a9","block_type":"box","text":"insurance companies, retirement plan record-keepers and other financial intermediaries (including","page_number":227,"box":{"x":117,"y":118,"width":731,"height":12}},{"id":"ffafd937-1c0b-4123-85ba-fd7b1436b001","block_type":"box","text":"BlackRock, BRIL and their affiliates) (collectively, “Service Organizations”) for certain support services","page_number":227,"box":{"x":117,"y":134,"width":761,"height":12}},{"id":"02e91785-70d1-4bb4-ab83-106fca27c97e","block_type":"box","text":"rendered by Service Organizations to their customers (“Customers”) who are the beneficial owners of","page_number":227,"box":{"x":117,"y":149,"width":756,"height":12}},{"id":"6bd2c753-671f-4602-8f84-c6870a2670ef","block_type":"box","text":"Investor A, Investor A1, Investor C, Investor P, Service and Class R Shares of a Fund. Such services","page_number":227,"box":{"x":117,"y":165,"width":755,"height":11}},{"id":"449aea52-bb8d-4561-89fa-694d5120b24a","block_type":"box","text":"are intended to supplement the services provided by the Fund’s Administrators and Transfer Agent to","page_number":227,"box":{"x":116,"y":180,"width":758,"height":12}},{"id":"4a4cdbdd-6f3b-4196-9f52-fa2eadeb3ae8","block_type":"box","text":"the Fund’s shareholders of record.","page_number":227,"box":{"x":116,"y":196,"width":261,"height":9}},{"id":"a7370e17-5507-45bb-b365-5c55eff55904","block_type":"box","text":"The support services provided by Service Organizations are general shareholder liaison services,","page_number":227,"box":{"x":116,"y":227,"width":728,"height":12}},{"id":"d09fc35d-6b7f-4ea8-a3d2-d4905b59bdc8","block_type":"box","text":"which include, but are not limited to: (i) answering Customer inquiries regarding account status and","page_number":227,"box":{"x":116,"y":242,"width":740,"height":12}},{"id":"7f85a055-219e-40e9-959d-54efd0a565d3","block_type":"box","text":"history, the manner in which purchases, exchanges and redemptions or repurchases of shares may be","page_number":227,"box":{"x":117,"y":258,"width":767,"height":12}},{"id":"2865fcb7-b216-4522-88a1-92d2d24cbca1","block_type":"box","text":"effected and certain other matters pertaining to the Customers’ investments; and (ii) assisting","page_number":227,"box":{"x":116,"y":273,"width":697,"height":12}},{"id":"3e3e2daa-c40a-4fd7-98b9-f019d177f259","block_type":"box","text":"Customers in designating and changing dividend options, account designations and addresses. The","page_number":227,"box":{"x":117,"y":289,"width":746,"height":12}},{"id":"a12aaebc-f419-45b8-875b-c43299cb7b27","block_type":"box","text":"shareholder servicing fees payable pursuant to the Plans are paid to compensate Service","page_number":227,"box":{"x":116,"y":304,"width":670,"height":12}},{"id":"ad2bd315-4178-419a-be98-d501ff06cee7","block_type":"box","text":"Organizations for the administration and servicing of shareholder accounts and are not costs which are","page_number":227,"box":{"x":116,"y":320,"width":769,"height":12}},{"id":"e92af04c-956d-4d30-9ab5-15489c74452a","block_type":"box","text":"primarily intended to result in the sale of the Fund’s shares.","page_number":227,"box":{"x":117,"y":335,"width":444,"height":12}},{"id":"359a1eb0-91e8-481d-bec7-2062c9dc1ebf","block_type":"box","text":"Payments under the Plans are based on a percentage of average daily net assets attributable to the","page_number":227,"box":{"x":117,"y":366,"width":746,"height":12}},{"id":"34792459-bbd1-42ae-bae8-bf7864d8c537","block_type":"box","text":"shares in the applicable share class regardless of the amount of expenses incurred. As a result,","page_number":227,"box":{"x":116,"y":382,"width":716,"height":12}},{"id":"ec626bf8-d0c5-4915-997e-bd5212384796","block_type":"box","text":"payments under the Plans may be more or less than expenses incurred in connection with providing","page_number":227,"box":{"x":117,"y":397,"width":747,"height":12}},{"id":"c6fca0fb-dd95-4cb2-920a-946e56b7f15e","block_type":"box","text":"distribution and/or shareholder services with respect to the related class. Information with respect to","page_number":227,"box":{"x":116,"y":413,"width":746,"height":12}},{"id":"641b564b-ec47-4188-bd76-1832ad9e1ea1","block_type":"box","text":"the payments under the Plans and expenses incurred in providing services with respect to the related","page_number":227,"box":{"x":116,"y":428,"width":758,"height":12}},{"id":"a50549e0-ec64-4d99-8d33-112969e3bee3","block_type":"box","text":"class is presented to the Directors for their consideration quarterly. Payments under the Plans consist","page_number":227,"box":{"x":116,"y":444,"width":759,"height":12}},{"id":"dbf7cf06-4b65-4f66-a1a1-469a7da6048c","block_type":"box","text":"of the shareholder servicing fees and the distribution fees. Expenses with respect to providing","page_number":227,"box":{"x":116,"y":459,"width":701,"height":12}},{"id":"1637b3eb-49cb-4f59-9e96-9ddfb0773990","block_type":"box","text":"distribution and/or shareholder services with respect to a class may consist of Service Organization","page_number":227,"box":{"x":116,"y":475,"width":742,"height":12}},{"id":"d9cdef08-c3b2-4a6b-9ba1-69a95cf8ed10","block_type":"box","text":"financial adviser compensation, branch office and regional operation center selling and transaction","page_number":227,"box":{"x":116,"y":490,"width":736,"height":12}},{"id":"84cc824b-6d37-4482-8a93-24a424a2d2b7","block_type":"box","text":"processing expenses, advertising, sales promotion and marketing expenses. Payments under the","page_number":227,"box":{"x":117,"y":506,"width":728,"height":12}},{"id":"bc83eaa2-8b5b-4127-8b90-365ebbe3f892","block_type":"box","text":"Plans with respect to one class will not be used to finance the expenditures of another class. Sales","page_number":227,"box":{"x":117,"y":521,"width":737,"height":12}},{"id":"240b439e-ca1c-45db-9350-255edda1f8e6","block_type":"box","text":"personnel may receive different compensation for selling different classes of shares.","page_number":227,"box":{"x":117,"y":537,"width":629,"height":12}},{"id":"7b33890a-65a4-4484-bb96-b51d29b5167b","block_type":"box","text":"Each Plan is subject to the provisions of Rule 12b-1 under the Investment Company Act. In their","page_number":227,"box":{"x":117,"y":568,"width":717,"height":12}},{"id":"d1bca9da-646a-46ef-bac6-06fdcdc88228","block_type":"box","text":"consideration of a Plan, the Directors must consider all factors they deem relevant, including","page_number":227,"box":{"x":116,"y":583,"width":690,"height":12}},{"id":"c4d4282d-6d69-497a-9f15-3718fff54cdb","block_type":"box","text":"information as to the benefits of the Plan to the Fund and the related class of shareholders. In","page_number":227,"box":{"x":117,"y":599,"width":699,"height":9}},{"id":"bf82d787-d489-4b77-87ab-c3f59277a71e","block_type":"box","text":"approving a Plan in accordance with Rule 12b-1, the non-interested Directors concluded that there is","page_number":227,"box":{"x":116,"y":614,"width":753,"height":12}},{"id":"1652a999-fc21-4ea8-9288-e7b5e8149ed3","block_type":"box","text":"reasonable likelihood that the Plan will benefit the Fund and its related class of shareholders. The Plan","page_number":227,"box":{"x":117,"y":630,"width":766,"height":9}},{"id":"7a9d782c-60b9-4908-b8aa-7dca1845ce77","block_type":"box","text":"provides, among other things, that: (i) the Board of Directors shall receive quarterly reports regarding","page_number":227,"box":{"x":117,"y":645,"width":752,"height":12}},{"id":"435457c0-3e33-45ea-bff5-853459adee5c","block_type":"box","text":"the amounts expended under the Plan and the purposes for which such expenditures were made; (ii)","page_number":227,"box":{"x":116,"y":661,"width":748,"height":12}},{"id":"d8afb8d8-bd62-4c80-91ca-4ef385b21874","block_type":"box","text":"the Plan will continue in effect for so long as its continuance is approved at least annually by the Board","page_number":227,"box":{"x":116,"y":676,"width":761,"height":12}},{"id":"7531cf8b-6934-4700-874c-a2b8afe6cb03","block_type":"box","text":"of Directors, including the directors who are not “interested persons” of the Fund (as defined in the","page_number":227,"box":{"x":116,"y":692,"width":729,"height":12}},{"id":"300d3120-2b60-40d2-9f77-03a6896c41bc","block_type":"box","text":"Investment Company Act) and who have no direct or indirect financial interest in the operation of the","page_number":227,"box":{"x":117,"y":707,"width":743,"height":12}},{"id":"c5483563-c3c2-4be4-9b88-128a89966559","block_type":"box","text":"Plan or any agreement entered into in connection with the Plan (the “12b-1 Directors”), acting in person","page_number":227,"box":{"x":117,"y":723,"width":765,"height":12}},{"id":"931da39b-bc43-44b3-ae43-5d2989f6b030","block_type":"box","text":"at a meeting called for said purpose in accordance with Rule 12b-1 under the Investment Company","page_number":227,"box":{"x":116,"y":738,"width":737,"height":12}},{"id":"fb5785f8-b673-4fdf-abd1-a6108e5200ef","block_type":"box","text":"Act; (iii) any material amendment thereto must be approved by the Board of Directors, including the","page_number":227,"box":{"x":116,"y":754,"width":737,"height":12}},{"id":"9f2bb3d0-117b-424f-ab23-4bf6afd28b1c","block_type":"box","text":"12b-1 Directors, acting in person at a meeting called for said purpose; (iv) any amendment to increase","page_number":227,"box":{"x":118,"y":769,"width":757,"height":12}},{"id":"9617dffb-1f53-42c8-a78a-3d21c2980328","block_type":"box","text":"materially the costs which any class of shares may bear for distribution services pursuant to the Plan","page_number":227,"box":{"x":117,"y":785,"width":745,"height":12}},{"id":"6caf4093-b5f2-492d-a520-e7810c7e4caa","block_type":"box","text":"shall be effective only upon approval by a vote of a majority of the outstanding shares of such class","page_number":227,"box":{"x":116,"y":800,"width":736,"height":12}},{"id":"a91d99ca-9128-4ce7-923e-b24d74d760c0","block_type":"box","text":"and by a majority of the Board of Directors, including the 12b-1 Directors, acting in person at a meeting","page_number":227,"box":{"x":116,"y":816,"width":763,"height":12}},{"id":"648bac75-e567-417c-9d2c-fab281db46aa","block_type":"box","text":"called for said purpose; and (v) while the Plan remains in effect, the selection and nomination of the","page_number":227,"box":{"x":116,"y":831,"width":744,"height":12}},{"id":"32bf7f5e-8c50-4b5c-85d0-35d4da1b7b9a","block_type":"box","text":"Fund’s Directors who are not “interested persons” of the Fund shall be committed to the discretion of","page_number":227,"box":{"x":117,"y":847,"width":750,"height":12}},{"id":"c85a4407-4563-4e40-97ea-8cd2bab30a57","block_type":"box","text":"the Fund’s non-interested Directors. Rule 12b-1 further requires that each Fund preserve copies of","page_number":227,"box":{"x":116,"y":862,"width":737,"height":12}},{"id":"cd941a7f-6d8b-4933-a3bf-1357b27d2654","block_type":"box","text":"II-140","page_number":227,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"7242027a-bb83-472b-bbed-a7b90bb7a98b","block_type":"box","text":"NM1026U-6004382-227/605","page_number":227,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"dc0d6aba-43d4-40cd-a979-924db6f677ca","block_type":"box","text":"each Plan and any report made pursuant to such Plan for a period of not less than six years from the","page_number":228,"box":{"x":116,"y":87,"width":753,"height":12}},{"id":"9be5f884-c08b-485f-a3bb-05824010b13d","block_type":"box","text":"date of the Plan or such report, the first two years in an easily accessible place.","page_number":228,"box":{"x":116,"y":102,"width":594,"height":13}},{"id":"07082df6-82b9-4eac-a830-b2749a4835a4","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","page_number":228,"box":{"x":117,"y":132,"width":762,"height":13}},{"id":"ab45c63e-0917-4fb0-b062-8f6a94175e1a","block_type":"box","text":"the 12b-1 Directors, or by vote of the holders of a majority of the shares of such class.","page_number":228,"box":{"x":116,"y":148,"width":643,"height":12}},{"id":"c36b98d8-449d-446d-993b-6f2557e6b33c","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Part I of each Fund’s SAI for","page_number":228,"box":{"x":116,"y":178,"width":770,"height":12}},{"id":"7f015c61-ce9f-4c9f-ac5c-d77ab9989350","block_type":"box","text":"information relating to the fees paid by your Fund to the Distributor under each Plan during the Fund’s","page_number":228,"box":{"x":117,"y":193,"width":759,"height":12}},{"id":"b622edb0-61a8-4b1a-b5db-a1e7034b7c4f","block_type":"box","text":"most recent fiscal year.","page_number":228,"box":{"x":117,"y":209,"width":177,"height":12}},{"id":"0f6557dd-6c5e-4075-8117-3dfdc683bfa5","block_type":"box","text":"Limitations on the Payment of Deferred Sales Charges","page_number":228,"box":{"x":117,"y":239,"width":439,"height":12}},{"id":"5610a0aa-d11e-4e64-8c47-45e05a5617b5","block_type":"box","text":"The maximum sales charge rule in the Conduct Rules of the Financial Industry Regulatory Authority","page_number":228,"box":{"x":116,"y":261,"width":745,"height":13}},{"id":"f31ba919-8412-4d02-b3dd-3bce51d09eeb","block_type":"box","text":"(“FINRA”) imposes a limitation on certain asset-based sales charges such as the distribution fee borne","page_number":228,"box":{"x":117,"y":277,"width":765,"height":12}},{"id":"bd8ae659-e189-4c70-8b40-999dc70fa1dd","block_type":"box","text":"by Class R Shares, and the distribution fee and the CDSC borne by the Investor C Shares. This","page_number":228,"box":{"x":117,"y":292,"width":715,"height":13}},{"id":"fe07fbd6-f997-443b-bbd1-b322972808c5","block_type":"box","text":"limitation does not apply to the shareholder servicing fee. The maximum sales charge rule is applied","page_number":228,"box":{"x":117,"y":308,"width":748,"height":12}},{"id":"629c3d72-75ba-420a-a50d-e4cb31432071","block_type":"box","text":"separately to each class and limits the aggregate of distribution fee payments and CDSCs payable by","page_number":228,"box":{"x":116,"y":323,"width":759,"height":13}},{"id":"1d5474d0-edf2-43d9-9d92-66b0801406c5","block_type":"box","text":"a Fund to (1) 6.25% of eligible gross sales of Investor C and Class R Shares, computed separately","page_number":228,"box":{"x":116,"y":339,"width":739,"height":12}},{"id":"5b4b47e4-20bb-48f9-99b1-9c6af70c1037","block_type":"box","text":"(excluding shares issued pursuant to dividend reinvestments and exchanges), plus (2) interest on the","page_number":228,"box":{"x":117,"y":354,"width":756,"height":13}},{"id":"226498ea-52aa-4cf9-a215-27950ac0e265","block_type":"box","text":"unpaid balance for the respective class, computed separately, at the prime rate plus 1% (the unpaid","page_number":228,"box":{"x":117,"y":370,"width":746,"height":12}},{"id":"15b733c4-a5aa-4fe6-a92d-51c1c1139348","block_type":"box","text":"balance being the maximum amount payable minus amounts received from the payment of the","page_number":228,"box":{"x":117,"y":385,"width":708,"height":13}},{"id":"e074b937-5ac8-49ba-aeea-1dee675f3f56","block_type":"box","text":"distribution fee and the CDSC). See “Information on Sales Charges and Distribution Related","page_number":228,"box":{"x":116,"y":401,"width":689,"height":12}},{"id":"cadd9d87-4637-4baf-a50e-0afe3928d438","block_type":"box","text":"Expenses” in Part I of each Fund’s SAI for comparative information as of your Fund’s most recent fiscal","page_number":228,"box":{"x":117,"y":416,"width":771,"height":13}},{"id":"45f312c6-c705-451d-82af-e52049952509","block_type":"box","text":"year end with respect to, if applicable, the Investor C and Class R Shares of your Fund.","page_number":228,"box":{"x":116,"y":432,"width":654,"height":12}},{"id":"2e70875d-2eaa-4def-9208-02e8a3171c40","block_type":"box","text":"Other Payments by the Fund","page_number":228,"box":{"x":116,"y":462,"width":234,"height":12}},{"id":"4b7cd7d6-e6ce-43db-9dbc-afcece64e9a7","block_type":"box","text":"In addition to shareholder servicing fees that a Fund may pay to a Service Organization pursuant to the","page_number":228,"box":{"x":117,"y":485,"width":770,"height":12}},{"id":"5de86b7d-0bb2-4e37-a10e-9b81178ed2c1","block_type":"box","text":"Plan and fees the Fund pays to its Transfer Agent, BlackRock, on behalf of a Fund, may enter into","page_number":228,"box":{"x":117,"y":500,"width":733,"height":12}},{"id":"5957bcde-7ca3-4af3-9c04-fe5ddacc7c6b","block_type":"box","text":"non-Plan agreements with Service Organizations pursuant to which the Fund will pay a Service","page_number":228,"box":{"x":117,"y":516,"width":711,"height":12}},{"id":"95a5c1e4-f436-4288-8013-d29834ca3b6b","block_type":"box","text":"Organization for administrative, networking, recordkeeping, sub-transfer agency, sub-accounting and/","page_number":228,"box":{"x":116,"y":531,"width":754,"height":12}},{"id":"9c4630a7-9ccd-4f19-838d-11527ffb9088","block_type":"box","text":"or shareholder services. These non-Plan payments are generally based on either (1) a percentage of","page_number":228,"box":{"x":116,"y":547,"width":755,"height":12}},{"id":"9338cd86-6e38-46d5-b0bb-84d1cdff0c72","block_type":"box","text":"the average daily net assets of Fund shareholders serviced by a Service Organization or (2) a fixed","page_number":228,"box":{"x":116,"y":562,"width":742,"height":12}},{"id":"1670b45c-d2bb-43d4-b000-45af44feaf95","block_type":"box","text":"dollar amount for each account serviced by a Service Organization. The aggregate amount of these","page_number":228,"box":{"x":116,"y":578,"width":745,"height":12}},{"id":"b2aa6f84-8581-4832-b03b-6530d6321da3","block_type":"box","text":"payments may be substantial.","page_number":228,"box":{"x":117,"y":593,"width":226,"height":12}},{"id":"d408c31a-3503-4cbd-b268-2ceceddfce77","block_type":"box","text":"Additional Payments by BlackRock","page_number":228,"box":{"x":116,"y":623,"width":286,"height":12}},{"id":"f86e7350-80f4-423c-9184-1557aa8dcd79","block_type":"box","text":"From time to time, BlackRock, BRIL and/or their affiliates (referred to in this section collectively","page_number":228,"box":{"x":117,"y":646,"width":707,"height":12}},{"id":"6a74b163-7914-47c4-8b9d-86f87505c447","block_type":"box","text":"as “BlackRock”) may compensate Service Organizations for the sale and distribution of shares of a","page_number":228,"box":{"x":116,"y":661,"width":734,"height":12}},{"id":"4bfde5b9-362f-4d49-bcc1-eb1caef5a4b0","block_type":"box","text":"Fund, for services to a Fund and its shareholders and/or for data provision or technology support. A","page_number":228,"box":{"x":117,"y":677,"width":738,"height":12}},{"id":"d5dcfede-69ac-4e2a-b0e0-bfc966b3e9cc","block_type":"box","text":"Service Organization may perform these obligations itself or may arrange for a third party to perform","page_number":228,"box":{"x":116,"y":692,"width":743,"height":12}},{"id":"7c4f3356-b509-49a1-8e43-b1e904fde13c","block_type":"box","text":"them. These payments, which are not made pursuant to a Plan or otherwise paid by a Fund, are","page_number":228,"box":{"x":116,"y":708,"width":714,"height":12}},{"id":"8a8f7b25-da77-4a8a-9244-59978aad31b2","block_type":"box","text":"referred to as “Additional Payments” herein.","page_number":228,"box":{"x":117,"y":723,"width":323,"height":12}},{"id":"2ff04125-fa3b-4ada-9b5b-692b76a0a38b","block_type":"box","text":"Additional Payments are made from BlackRock’s own assets (which may come directly or indirectly","page_number":228,"box":{"x":116,"y":753,"width":737,"height":12}},{"id":"6f3fb391-c502-4968-bcf4-944989646d7a","block_type":"box","text":"from fees paid by a Fund to BlackRock for various services, such as investment advisory services).","page_number":228,"box":{"x":116,"y":769,"width":735,"height":12}},{"id":"0bd77ac4-0352-4464-bef2-25dd2fc81065","block_type":"box","text":"These payments are not an additional charge to a Fund or its shareholders and do not change the","page_number":228,"box":{"x":116,"y":784,"width":728,"height":12}},{"id":"a6b16ed5-516a-4cc2-896f-9ac52765f221","block_type":"box","text":"price paid by shareholders for the purchase of a Fund’s shares or the amount a Fund receives as","page_number":228,"box":{"x":117,"y":800,"width":720,"height":12}},{"id":"b3a20622-0c41-4188-a373-f8811b186428","block_type":"box","text":"proceeds from such purchases. Additional Payments made to Service Organizations are in addition to","page_number":228,"box":{"x":117,"y":815,"width":755,"height":12}},{"id":"200f966e-4fb8-4295-91d7-3ef392568d7b","block_type":"box","text":"any distribution or shareholder servicing fees paid under any Plan of any Fund, any sales charges,","page_number":228,"box":{"x":116,"y":831,"width":736,"height":12}},{"id":"e11fe602-c164-40e6-a1e9-d6b4fd704454","block_type":"box","text":"commissions or other concessions described in the Prospectuses or this SAI, and any administrative,","page_number":228,"box":{"x":116,"y":846,"width":757,"height":12}},{"id":"6af7aeb5-15cd-427d-a558-a08409345608","block_type":"box","text":"networking, recordkeeping, sub-transfer agency or sub-accounting fees payable by a Fund. Pursuant","page_number":228,"box":{"x":117,"y":862,"width":754,"height":12}},{"id":"5410940c-2eb2-4930-a08e-145f195a5401","block_type":"box","text":"to applicable FINRA regulations, the details of certain of these payments, including the Service","page_number":228,"box":{"x":116,"y":877,"width":708,"height":12}},{"id":"3c162429-99ca-401d-952d-7fde262702c1","block_type":"box","text":"II-141","page_number":228,"box":{"x":480,"y":909,"width":38,"height":9}},{"id":"b41b0d6d-aa02-406e-bc3f-4881d327ce91","block_type":"box","text":"NM1026U-6004382-228/605","page_number":228,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"7099ff72-450f-43af-ab2d-a3615e334b81","block_type":"box","text":"Organizations receiving such payments in connection with the sale and distribution of Fund shares, are","page_number":229,"box":{"x":116,"y":87,"width":770,"height":12}},{"id":"b31d6220-5380-4db5-9254-9d6420c1116c","block_type":"box","text":"required to be disclosed. While FINRA regulations limit the sales charges that shareholders may bear,","page_number":229,"box":{"x":117,"y":103,"width":761,"height":12}},{"id":"250cc847-7ee0-48fd-9b58-14a5af329f1f","block_type":"box","text":"there are no limits with regard to the amounts that BlackRock may pay out of its own assets.","page_number":229,"box":{"x":116,"y":118,"width":690,"height":12}},{"id":"de26b21e-4776-476c-bf72-4832205bbc50","block_type":"box","text":"Additional Payments may be made as a fixed dollar amount, may be based on the number of","page_number":229,"box":{"x":116,"y":146,"width":695,"height":12}},{"id":"3536a022-2be4-45b8-a2d0-f65ccda41019","block_type":"box","text":"Customer accounts maintained by a Service Organization, may be based on a percentage of the value","page_number":229,"box":{"x":117,"y":162,"width":766,"height":12}},{"id":"a38ba5e2-dab8-4a84-8fc5-975387c71be0","block_type":"box","text":"of shares sold to, or held by, Customers of the Service Organization involved, or may be calculated on","page_number":229,"box":{"x":116,"y":177,"width":764,"height":12}},{"id":"3d737b2e-d1c2-467f-b1b0-1e23006b6605","block_type":"box","text":"another basis.","page_number":229,"box":{"x":116,"y":193,"width":110,"height":9}},{"id":"550d836d-602d-464c-b099-3e5e18984327","block_type":"box","text":"BlackRock negotiates Additional Payments with each Service Organization on an individual basis.","page_number":229,"box":{"x":117,"y":221,"width":730,"height":12}},{"id":"866eb29d-0c48-4021-9867-2db76c5b5e13","block_type":"box","text":"Additional Payments may be different for different Service Organizations, and some Service","page_number":229,"box":{"x":116,"y":237,"width":687,"height":12}},{"id":"037028e8-1eaf-4faf-a27d-c160d0bff963","block_type":"box","text":"Organizations may be paid pursuant to more than one of the calculations described above. Not all","page_number":229,"box":{"x":116,"y":252,"width":731,"height":12}},{"id":"a9787e12-e5d7-4c5d-afeb-da894c66e7d3","block_type":"box","text":"Service Organizations receive Additional Payments. Sales-based payments primarily create incentives","page_number":229,"box":{"x":116,"y":268,"width":766,"height":12}},{"id":"8ad7b81d-a3f0-400f-9b60-30d949c8f7e1","block_type":"box","text":"to make new sales of shares of the Fund, and asset-based payments primarily create incentives to","page_number":229,"box":{"x":116,"y":283,"width":737,"height":12}},{"id":"fbdfe61c-1dcb-4164-a346-c0b0ed3af488","block_type":"box","text":"retain previously sold shares of the Fund. The level of payments made to these Service Organizations","page_number":229,"box":{"x":117,"y":299,"width":761,"height":12}},{"id":"4eb615e1-d7e3-4478-8587-377605ab88cb","block_type":"box","text":"in any year will vary and may be limited to specific Funds or share classes. 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The same Service Organization, or one or more of its affiliates, may receive","page_number":229,"box":{"x":117,"y":389,"width":712,"height":12}},{"id":"8688077d-110e-4770-a3f0-94fcff2870ae","block_type":"box","text":"payments under more than one category of Additional Payments. Such payments may be different for","page_number":229,"box":{"x":117,"y":405,"width":759,"height":12}},{"id":"9f0d9be2-ae9a-47c8-a9a4-a1cb6f50c1f1","block_type":"box","text":"different Service Organizations and for different types of Funds.","page_number":229,"box":{"x":116,"y":420,"width":477,"height":12}},{"id":"593fd71f-3525-4c4c-8949-ca1d869af7bf","block_type":"box","text":"A. 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These payments normally will not exceed the sum of (a) 0.25% of such year’s Fund sales by","page_number":229,"box":{"x":116,"y":656,"width":757,"height":13}},{"id":"b38d91f6-6157-4293-964f-60f49ffb82ef","block_type":"box","text":"that Service Organization, and (b) 0.21% of the assets attributable to that Service Organization","page_number":229,"box":{"x":116,"y":672,"width":703,"height":12}},{"id":"8e9632ca-a934-4950-8659-f9c51acfbfd4","block_type":"box","text":"invested in a Fund.","page_number":229,"box":{"x":117,"y":688,"width":139,"height":9}},{"id":"8e57c2d9-e79c-4c46-82f3-6e00f9ff1c34","block_type":"box","text":"B. Shareholder Services","page_number":229,"box":{"x":150,"y":716,"width":181,"height":9}},{"id":"47db0210-cde8-485b-96df-98db2d0c144c","block_type":"box","text":"Many Fund shares are owned or held by Service Organizations for the benefit of their Customers. In","page_number":229,"box":{"x":117,"y":738,"width":742,"height":12}},{"id":"5c1d4be0-6e1d-4c67-9d3b-48362f3ec439","block_type":"box","text":"these situations, a Fund may not maintain accounts in the name of the Customers and Service","page_number":229,"box":{"x":116,"y":753,"width":702,"height":12}},{"id":"eacea886-1018-45fb-a59f-dc55bfb4cd38","block_type":"box","text":"Organizations may perform some of the functions for these Customers’ accounts that the Transfer","page_number":229,"box":{"x":116,"y":769,"width":728,"height":12}},{"id":"4736e8f2-fd14-4b4f-9c12-4c9d6f90d750","block_type":"box","text":"Agent would have performed if the accounts had been in the Customers’ names on the Fund’s books.","page_number":229,"box":{"x":116,"y":784,"width":753,"height":12}},{"id":"bf3c312c-994a-4c80-a07a-1b85915becc0","block_type":"box","text":"Such services include sub-accounting services, shareholder servicing and transaction processing","page_number":229,"box":{"x":116,"y":800,"width":722,"height":12}},{"id":"398a8b6d-a253-4b80-a419-676d8af8db46","block_type":"box","text":"services and are sometimes referred to as “recordkeeping,” “sub-transfer agency,” “sub-accounting,”","page_number":229,"box":{"x":116,"y":815,"width":745,"height":12}},{"id":"1758cde1-ecb8-401b-a3e5-116708be0553","block_type":"box","text":"“networking” and/or “administrative” services. Additional Payments may exceed amounts that would be","page_number":229,"box":{"x":116,"y":831,"width":768,"height":12}},{"id":"026f4558-a1c6-457e-95b0-be58ae94f88b","block_type":"box","text":"earned on these assets by the Transfer Agent for the performance of these or similar services. These","page_number":229,"box":{"x":116,"y":846,"width":758,"height":12}},{"id":"e6cfa2b1-376e-48f0-998c-b3491821a7c6","block_type":"box","text":"Additional Payments made by BlackRock are in addition to any transfer agent, shareholder servicing","page_number":229,"box":{"x":116,"y":862,"width":750,"height":12}},{"id":"02ea0df0-920a-4075-9611-f15fe9eb2b0f","block_type":"box","text":"and transaction processing fees paid by a Fund, as applicable.","page_number":229,"box":{"x":116,"y":877,"width":470,"height":12}},{"id":"69b57aab-b5e7-45f8-b3ae-6a1ed8fef15e","block_type":"box","text":"II-142","page_number":229,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"d1e2acf1-da9f-4073-a7ab-685d09625cf9","block_type":"box","text":"NM1026U-6004382-229/605","page_number":229,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"e6996d89-1dd6-433e-a2f7-6a7470b5044a","block_type":"box","text":"C. 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Such Additional Payments are generally made as a fixed dollar","page_number":230,"box":{"x":116,"y":140,"width":728,"height":12}},{"id":"469a9628-d80d-4b77-a7b2-1d55ca2427fb","block_type":"box","text":"amount, and not based on assets or sales.","page_number":230,"box":{"x":116,"y":155,"width":322,"height":11}},{"id":"6ee28bce-b075-4cdb-8d4b-0ae8d25a9c43","block_type":"box","text":"D. Service Organizations Receiving Additional Payments","page_number":230,"box":{"x":150,"y":183,"width":427,"height":12}},{"id":"c0251004-59bd-4f63-a50c-5a109b8bd8a4","block_type":"box","text":"As of the date of this SAI, the Service Organizations listed below, and, in some cases, certain of the","page_number":230,"box":{"x":116,"y":205,"width":746,"height":12}},{"id":"eb47c6a5-06af-415e-abe6-f911181a6a61","block_type":"box","text":"Service Organization’s affiliates, may be receiving one or more types of Additional Payments. This list","page_number":230,"box":{"x":116,"y":220,"width":759,"height":12}},{"id":"3ac72b96-2273-464c-b8ec-38a69d41fa92","block_type":"box","text":"may change over time, and BlackRock may pay Service Organizations or their affiliates additional","page_number":230,"box":{"x":117,"y":236,"width":729,"height":12}},{"id":"ae3c0862-aa09-4397-b477-cafb6ee4c0cd","block_type":"box","text":"types of Additional Payments in the future. Please contact your Service Organization to determine","page_number":230,"box":{"x":116,"y":251,"width":731,"height":12}},{"id":"8927a5dc-5a66-428f-8c22-b28cdd1890b5","block_type":"box","text":"whether it or its affiliate currently may be receiving such payments and to obtain further information","page_number":230,"box":{"x":116,"y":267,"width":739,"height":12}},{"id":"68d7889c-635c-44fe-89ca-5771246d5390","block_type":"box","text":"regarding any such payments.","page_number":230,"box":{"x":117,"y":282,"width":229,"height":12}},{"id":"e5df6dd2-a767-45be-bf59-6f2be7e8858e","block_type":"box","text":"&Partners","page_number":230,"box":{"x":116,"y":304,"width":79,"height":10}},{"id":"4d3a3c48-3fa1-42bb-8c65-6e1b44ef9d33","block_type":"box","text":"AccuTech Systems Corporation","page_number":230,"box":{"x":116,"y":320,"width":241,"height":12}},{"id":"dfc53768-5aeb-428d-b82a-3e28e1e4d0db","block_type":"box","text":"ADP Broker-Dealer, 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(A Fund may also suspend or postpone the recordation of the transfer of its","page_number":234,"box":{"x":116,"y":490,"width":761,"height":12}},{"id":"3f48e61e-6952-4b30-9b82-cc6a43a38d3d","block_type":"box","text":"shares upon the occurrence of any of the foregoing conditions.)","page_number":234,"box":{"x":116,"y":506,"width":476,"height":12}},{"id":"597c6897-558f-4ec0-874d-80d3ff327d7b","block_type":"box","text":"Each Fund, with other investment companies advised by the Manager, has entered into a joint","page_number":234,"box":{"x":117,"y":537,"width":703,"height":12}},{"id":"1da29afa-4bf7-431f-98d1-8dab32b24768","block_type":"box","text":"committed line of credit with a syndicate of banks that is intended to provide the Fund with a temporary","page_number":234,"box":{"x":116,"y":552,"width":768,"height":12}},{"id":"5824c8fc-03c7-4fbf-9547-76f3d702042f","block_type":"box","text":"source of cash to be used to meet redemption requests from shareholders in extraordinary or","page_number":234,"box":{"x":116,"y":568,"width":697,"height":12}},{"id":"456105e4-d5b8-4e64-a610-8473c2e24ae6","block_type":"box","text":"emergency circumstances.","page_number":234,"box":{"x":116,"y":583,"width":205,"height":12}},{"id":"ac6fb06d-1302-4ee5-bd3c-050cb078401d","block_type":"box","text":"Each Fund may redeem shares involuntarily to reimburse the Fund for any loss sustained by reason of","page_number":234,"box":{"x":117,"y":614,"width":766,"height":12}},{"id":"d7146789-150c-44b9-856c-743736f5f513","block_type":"box","text":"the failure of a shareholder to make full payment for shares purchased by the shareholder or to collect","page_number":234,"box":{"x":116,"y":630,"width":763,"height":12}},{"id":"1e29873a-f67b-48f1-9eb9-88eeab5e05df","block_type":"box","text":"any charge relating to a transaction effected for the benefit of a shareholder. Each Fund reserves the","page_number":234,"box":{"x":116,"y":645,"width":754,"height":12}},{"id":"da586002-f7f7-4b97-8a85-0977c93de493","block_type":"box","text":"express right to redeem shares of the Fund involuntarily at any time if the Fund’s Board of Directors","page_number":234,"box":{"x":116,"y":661,"width":738,"height":12}},{"id":"80fc4599-9671-4797-b233-ec15186d8874","block_type":"box","text":"determines, in its sole discretion, that failure to do so may have adverse consequences to the holders","page_number":234,"box":{"x":116,"y":676,"width":753,"height":12}},{"id":"f2b6ca8b-40b6-4ae4-b2a4-2eee12c1f8a7","block_type":"box","text":"of shares in the Fund. Upon such redemption the holders of shares so redeemed shall have no further","page_number":234,"box":{"x":116,"y":692,"width":759,"height":12}},{"id":"ed1c9160-e657-4d84-b23f-8b8f23164773","block_type":"box","text":"right with respect thereto other than to receive payment of the redemption price.","page_number":234,"box":{"x":117,"y":707,"width":591,"height":12}},{"id":"fc51b925-a39e-455a-9d40-11570aa6ceed","block_type":"box","text":"Redemption","page_number":234,"box":{"x":117,"y":738,"width":95,"height":12}},{"id":"142bf573-85b6-456b-80a1-f6d2ba1a0bf4","block_type":"box","text":"Investor A, Investor A1, Investor C, Institutional and Class R Shares","page_number":234,"box":{"x":117,"y":761,"width":504,"height":12}},{"id":"e242932f-66e5-4ef9-a37b-d586c3df1abb","block_type":"box","text":"Redeem by Telephone","page_number":234,"box":{"x":117,"y":785,"width":177,"height":12}},{"id":"c7342cf9-f51c-4807-87da-1c60ca20b267","block_type":"box","text":": You may sell Investor Shares, excluding Investor P Shares, held at","page_number":234,"box":{"x":296,"y":785,"width":505,"height":12}},{"id":"03863c41-d9e4-46a5-8487-247f684f0356","block_type":"box","text":"BlackRock by telephone request if certain conditions are met and if the amount being sold is less than","page_number":234,"box":{"x":117,"y":800,"width":754,"height":12}},{"id":"356ac67c-018d-4c88-a252-952007cbd368","block_type":"box","text":"(i) $100,000 for payments by check or (ii) $250,000 for payments through the Automated Clearing","page_number":234,"box":{"x":117,"y":815,"width":724,"height":13}},{"id":"47729910-03ef-446d-a18b-f2eb991f7d3c","block_type":"box","text":"House Network (“ACH”) or wire transfer. Certain redemption requests, such as those in excess of","page_number":234,"box":{"x":117,"y":831,"width":727,"height":12}},{"id":"67e75c87-e59d-4809-8832-4eb0146711ad","block_type":"box","text":"these amounts, and those where (i) the Fund does not have verified banking information on file; or","page_number":234,"box":{"x":116,"y":847,"width":734,"height":12}},{"id":"6091f63b-2d69-4ae8-8659-a1fb9d9f9072","block_type":"box","text":"(ii) the proceeds are not paid to the record owner at the record address, must be in writing with a","page_number":234,"box":{"x":117,"y":862,"width":720,"height":12}},{"id":"532f9af6-f28e-46d5-b3b9-6ed24ffd9732","block_type":"box","text":"medallion signature guarantee provided by any “eligible guarantor institution” as defined in","page_number":234,"box":{"x":117,"y":878,"width":674,"height":12}},{"id":"82ac6152-6578-40e7-af2d-f9402d3e788d","block_type":"box","text":"II-147","page_number":234,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"725c8946-f295-4801-a8f2-a2433995641c","block_type":"box","text":"NM1026U-6004382-234/605","page_number":234,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"94d5e6f4-5c48-4259-9df2-75a813cda338","block_type":"box","text":"Rule 17Ad-15 under the Securities Exchange Act of 1934 (the “Exchange Act”), whose existence and","page_number":235,"box":{"x":117,"y":87,"width":756,"height":12}},{"id":"ccad4656-1fb3-4740-a36f-3ca3ff267778","block_type":"box","text":"validity may be verified by the Transfer Agent through the use of industry publications. For Institutional","page_number":235,"box":{"x":116,"y":102,"width":763,"height":13}},{"id":"b77bbe97-af3b-43d9-822b-4a2b33c57899","block_type":"box","text":"Shares, certain redemption requests may require written instructions with a medallion signature","page_number":235,"box":{"x":116,"y":118,"width":713,"height":12}},{"id":"86f46f70-4260-46f0-8eb0-1cc1d0c16afb","block_type":"box","text":"guarantee. Call (800) 441-7762 for details. You can obtain a medallion signature guarantee stamp from","page_number":235,"box":{"x":116,"y":134,"width":772,"height":12}},{"id":"26a6a7c9-c269-4701-aa22-c7e34a9c5ff6","block_type":"box","text":"a bank, securities dealer, securities broker, credit union, savings and loan association, national","page_number":235,"box":{"x":116,"y":149,"width":709,"height":12}},{"id":"df729343-a4ae-43f6-af1e-553d12349740","block_type":"box","text":"securities exchange or registered securities association. The three recognized medallion programs are","page_number":235,"box":{"x":116,"y":165,"width":767,"height":12}},{"id":"77b0efc3-8829-4e57-a3ee-a92af9c54efe","block_type":"box","text":"Securities Transfer Agent Medallion Program, Stock Exchanges Medallion Program and New York","page_number":235,"box":{"x":116,"y":180,"width":736,"height":12}},{"id":"3cb726bf-e32c-4fc7-ac4d-bdb0aa1d2e77","block_type":"box","text":"Stock Exchange, Inc. Medallion Signature Program. Signature guarantees which are not a part of","page_number":235,"box":{"x":116,"y":196,"width":727,"height":12}},{"id":"54bad204-f7d6-411c-b7fb-f36978c2a227","block_type":"box","text":"these programs will not be accepted. A notary public seal will not be acceptable. Generally, a properly","page_number":235,"box":{"x":116,"y":211,"width":761,"height":12}},{"id":"8aab4776-7ca9-456e-8678-6e92e08ef55e","block_type":"box","text":"signed written request with any required signature guarantee is all that is required for a redemption. In","page_number":235,"box":{"x":116,"y":227,"width":761,"height":12}},{"id":"a405e1d2-e4df-42f0-a593-4e9bddd8ce99","block_type":"box","text":"some cases, however, other documents may be necessary. Additional documentary evidence of","page_number":235,"box":{"x":116,"y":242,"width":719,"height":12}},{"id":"19f76544-f1ad-4c0a-a397-01719d9adfcb","block_type":"box","text":"authority is required by the Transfer Agent in the event redemption is requested by a corporation,","page_number":235,"box":{"x":116,"y":258,"width":726,"height":12}},{"id":"9082c777-7c88-40d2-8151-6981345ee089","block_type":"box","text":"partnership, trust, fiduciary, executor or administrator.","page_number":235,"box":{"x":117,"y":273,"width":402,"height":12}},{"id":"730198b9-1fd8-4876-9a03-4439bfbc09f0","block_type":"box","text":"If you make a redemption request before a Fund has collected payment for the purchase of shares, the","page_number":235,"box":{"x":117,"y":304,"width":769,"height":12}},{"id":"e522f095-f1bd-4434-9493-d03df37de005","block_type":"box","text":"Fund may delay mailing your proceeds. This delay will usually not exceed ten days. A Fund, its","page_number":235,"box":{"x":117,"y":320,"width":709,"height":12}},{"id":"baa0a98c-7bf7-4571-ac17-56cc0f260ba9","block_type":"box","text":"Administrators and the Distributor will employ reasonable procedures to confirm that instructions","page_number":235,"box":{"x":116,"y":335,"width":719,"height":12}},{"id":"53d581ec-298f-423e-bd70-f9dbb4515041","block_type":"box","text":"communicated by telephone are genuine. Telephone redemption requests will not be honored if: (i) the","page_number":235,"box":{"x":116,"y":351,"width":767,"height":12}},{"id":"b55c4ddf-804c-4288-8557-f953f0eaa514","block_type":"box","text":"accountholder is deceased, (ii) the proceeds are to be sent to someone other than the shareholder of","page_number":235,"box":{"x":116,"y":366,"width":756,"height":12}},{"id":"17d059f7-65f9-4579-918f-505c2dadef70","block_type":"box","text":"record, (iii) a Fund does not have verified information on file, (iv) the request is by an individual other","page_number":235,"box":{"x":117,"y":382,"width":749,"height":12}},{"id":"0525ba2a-6259-4832-9ba2-0a9a55a66b14","block_type":"box","text":"than the accountholder of record, (v) the account is held by joint tenants who are divorced, (vi) the","page_number":235,"box":{"x":116,"y":397,"width":733,"height":12}},{"id":"79ce0760-a03e-4b9e-b51b-b1b959f8cf03","block_type":"box","text":"address on the account has changed within the last 30 days or share certificates have been issued on","page_number":235,"box":{"x":116,"y":413,"width":762,"height":12}},{"id":"d3c1dd80-0c1e-4975-82cc-5c0148f9b36d","block_type":"box","text":"the account, or (vii) to protect against fraud, if the caller is unable to provide the account number, the","page_number":235,"box":{"x":116,"y":428,"width":752,"height":12}},{"id":"820f4937-de51-4511-bd66-a5a133966911","block_type":"box","text":"name and address registered on the account and the social security number registered on the account.","page_number":235,"box":{"x":117,"y":444,"width":770,"height":12}},{"id":"fbd69bb9-c2ec-4376-84d3-cae0d2573cc0","block_type":"box","text":"The Fund and its service providers will not be liable for any loss, liability, cost or expense for acting","page_number":235,"box":{"x":116,"y":459,"width":739,"height":12}},{"id":"bc269c6e-326a-4d16-9682-da4a3b36fe82","block_type":"box","text":"upon telephone instructions that are reasonably believed to be genuine in accordance with such","page_number":235,"box":{"x":117,"y":475,"width":716,"height":12}},{"id":"d394c06c-80c1-4cc0-8b88-c748efbb6fce","block_type":"box","text":"procedures. Before telephone requests will be honored, signature approval from all shareholders of","page_number":235,"box":{"x":117,"y":490,"width":741,"height":12}},{"id":"cda1da38-a2ac-4eb2-a398-79f755b38fcc","block_type":"box","text":"record on the account must be obtained. The Fund may refuse a telephone redemption request if it","page_number":235,"box":{"x":117,"y":506,"width":738,"height":12}},{"id":"260f966d-7a0e-456c-a1ff-12492dbdcfbf","block_type":"box","text":"believes it is advisable to do so. During periods of substantial economic or market change, telephone","page_number":235,"box":{"x":117,"y":521,"width":754,"height":12}},{"id":"1db7b8f1-2367-4843-b327-096c586ae7db","block_type":"box","text":"redemptions may be difficult to complete. Please find below alternative redemption methods.","page_number":235,"box":{"x":117,"y":537,"width":691,"height":12}},{"id":"8368bdd0-87a9-4ddf-bb67-c5baf517bd72","block_type":"box","text":"Redemption orders for Institutional Shares placed prior to 4:00 p.m. (Eastern time) on a business day","page_number":235,"box":{"x":117,"y":568,"width":756,"height":12}},{"id":"206397c3-145d-48e0-a018-623ddc05b3db","block_type":"box","text":"will be priced at the NAV determined that day. If redemption orders are received by 4:00 p.m. (Eastern","page_number":235,"box":{"x":116,"y":583,"width":764,"height":12}},{"id":"23a631d1-1b3f-4346-8137-c0d451cabc28","block_type":"box","text":"time) on a business day, payment for redeemed Institutional Shares will normally be wired in Federal","page_number":235,"box":{"x":116,"y":599,"width":753,"height":12}},{"id":"40529853-d3f4-45ed-8a3d-57cb10129145","block_type":"box","text":"Funds on the next business day. If the Federal Reserve Bank of Philadelphia is not open on the","page_number":235,"box":{"x":117,"y":614,"width":713,"height":12}},{"id":"9f244514-6a4a-4a05-a471-89ade9ed771e","block_type":"box","text":"business day following receipt of the redemption order, the redemption order will be accepted and","page_number":235,"box":{"x":117,"y":630,"width":729,"height":12}},{"id":"d9dc990a-7624-45a7-9c7f-8668d1d07f99","block_type":"box","text":"processed the next succeeding business day when the Federal Reserve Bank of Philadelphia is open,","page_number":235,"box":{"x":117,"y":645,"width":762,"height":12}},{"id":"71f705cf-20c7-4fab-baee-1e979b0dc449","block_type":"box","text":"provided that the Fund’s custodian is also open for business.","page_number":235,"box":{"x":117,"y":661,"width":449,"height":12}},{"id":"705170a5-e73a-45a4-a3f4-76385648b2d0","block_type":"box","text":"Redeem by VRU","page_number":235,"box":{"x":117,"y":692,"width":127,"height":12}},{"id":"95e1fc37-e1de-4ae2-b3b1-236597378d15","block_type":"box","text":": Investor class shares, excluding Investor P Shares, may also be redeemed by use","page_number":235,"box":{"x":247,"y":692,"width":620,"height":12}},{"id":"3bdd8ac4-add0-441a-87d9-a6894b874474","block_type":"box","text":"of a Fund’s automated voice response unit service (“VRU”). Payment for Investor class shares","page_number":235,"box":{"x":116,"y":707,"width":700,"height":12}},{"id":"bbd7e28a-a067-4ed1-b9e3-aaa4d16eb1e8","block_type":"box","text":"redeemed by VRU may be made for non-retirement accounts in amounts up to $25,000, either through","page_number":235,"box":{"x":117,"y":722,"width":761,"height":13}},{"id":"15d04058-337c-40e9-9e97-4c3c6534f42d","block_type":"box","text":"check, ACH or wire.","page_number":235,"box":{"x":116,"y":738,"width":147,"height":11}},{"id":"0d7a33a8-bf00-47e6-a4d6-6b25bdf2b7d4","block_type":"box","text":"Redeem by Internet:","page_number":235,"box":{"x":117,"y":769,"width":159,"height":12}},{"id":"ed6b9213-79c9-4f9c-8f3c-a39927b87e8d","block_type":"box","text":"Certain Investor and Institutional class shares may also be redeemed by logging","page_number":235,"box":{"x":283,"y":769,"width":595,"height":12}},{"id":"ea81babf-9362-4817-a11d-16a972f030f3","block_type":"box","text":"onto the BlackRock website at www.blackrock.com. Proceeds from Internet redemptions may be sent","page_number":235,"box":{"x":116,"y":785,"width":753,"height":12}},{"id":"7a71b142-909f-4d41-b9ac-91d0a223a4fa","block_type":"box","text":"via check, ACH or wire to the bank account of record. Payment for shares redeemed by Internet may","page_number":235,"box":{"x":116,"y":800,"width":749,"height":12}},{"id":"8f12465d-525c-4a47-ad35-a27dbc76e07e","block_type":"box","text":"be made for non-retirement accounts up to $100,000 per account per day, either through check, ACH","page_number":235,"box":{"x":117,"y":815,"width":751,"height":13}},{"id":"b3720c2c-06f7-4a11-acbe-ff21d1e05b44","block_type":"box","text":"or wire. Different maximums may apply to certain institutional investors.","page_number":235,"box":{"x":116,"y":831,"width":535,"height":12}},{"id":"60100de2-05e8-49bc-adca-32f58ae368a1","block_type":"box","text":"Redeem in Writing:","page_number":235,"box":{"x":117,"y":862,"width":157,"height":12}},{"id":"02f94274-aa7f-416e-93e4-9cc6ba7c0a83","block_type":"box","text":"If you hold shares with the Transfer Agent you may redeem such shares without","page_number":235,"box":{"x":275,"y":862,"width":599,"height":12}},{"id":"a3d65df9-a64b-4880-938d-cedafdce7a32","block_type":"box","text":"charge by writing to BlackRock, P.O. Box 534429, Pittsburgh, Pennsylvania 15253-4429. Redemption","page_number":235,"box":{"x":116,"y":878,"width":761,"height":12}},{"id":"484a5004-f6cd-4036-9865-7faf1a0263a9","block_type":"box","text":"II-148","page_number":235,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"e13ebf25-8beb-48ea-b040-b6373c90f65c","block_type":"box","text":"NM1026U-6004382-235/605","page_number":235,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"19709e20-2a7d-4739-b115-55dea808a315","block_type":"box","text":"requests delivered other than by mail should be sent to BlackRock, Attention: 534429, 1350 Penn","page_number":236,"box":{"x":117,"y":87,"width":729,"height":12}},{"id":"068ea31a-14c2-470b-a33b-9f7e739e0747","block_type":"box","text":"Avenue, Suite 102, Pittsburgh, Pennsylvania 15222. If you hold share certificates issued by your Fund,","page_number":236,"box":{"x":116,"y":102,"width":768,"height":13}},{"id":"db72be79-63a7-4fb1-a193-12c850c59ff7","block_type":"box","text":"the letter must be accompanied by certificates for the shares. All shareholders on the account must","page_number":236,"box":{"x":116,"y":118,"width":741,"height":12}},{"id":"ccac1521-2191-4d5c-99bd-265dcc5135ad","block_type":"box","text":"sign the letter. A medallion signature guarantee will generally be required but may be waived in certain","page_number":236,"box":{"x":116,"y":134,"width":766,"height":12}},{"id":"d9de7216-14d1-4310-8b0c-ee15d2462165","block_type":"box","text":"limited circumstances. You can obtain a medallion signature guarantee stamp from a bank, securities","page_number":236,"box":{"x":117,"y":149,"width":756,"height":12}},{"id":"32367696-c46f-4b0a-924e-8aa5bf50f272","block_type":"box","text":"dealer, securities broker, credit union, savings and loan association, national securities exchange or","page_number":236,"box":{"x":116,"y":165,"width":746,"height":12}},{"id":"d2c81ae1-3e57-4806-89b1-a58b4e3b8a02","block_type":"box","text":"registered securities association. A notary public seal will not be acceptable. If you hold stock","page_number":236,"box":{"x":117,"y":180,"width":696,"height":12}},{"id":"9c541bce-964a-4d8b-8e2b-1c86e3d226c3","block_type":"box","text":"certificates, return the certificates with the letter. Proceeds from redemptions may be sent via check,","page_number":236,"box":{"x":116,"y":196,"width":749,"height":12}},{"id":"58497b8e-7aae-40e2-a528-ca3d663b1290","block_type":"box","text":"ACH or wire to the bank account of record.","page_number":236,"box":{"x":116,"y":211,"width":323,"height":10}},{"id":"65bf32cb-70af-42a7-8a79-6e3eb831016a","block_type":"box","text":"Redemptions of Investor P Shares, Service Shares, Class G Shares, Class K Shares and BlackRock","page_number":236,"box":{"x":116,"y":239,"width":754,"height":12}},{"id":"969433d6-539b-476a-bf0a-7963b6d0d8bc","block_type":"box","text":"Shares may be made in the manner and amounts described in the Prospectuses.","page_number":236,"box":{"x":117,"y":254,"width":608,"height":13}},{"id":"c820ff73-f2cc-4ae2-84ec-b317f4771066","block_type":"box","text":"The Funds or the Transfer Agent may temporarily suspend telephone transactions at any time.","page_number":236,"box":{"x":116,"y":282,"width":707,"height":12}},{"id":"f08e26f6-249a-4bc7-affb-53c57d4c3e03","block_type":"box","text":"If you redeem shares directly with the Transfer Agent, payments will generally be mailed within one","page_number":236,"box":{"x":117,"y":310,"width":740,"height":12}},{"id":"5b56960f-6433-4417-8037-028b6e0d36db","block_type":"box","text":"business day of receipt of the proper notice of redemption. A Fund may delay the mailing of a","page_number":236,"box":{"x":117,"y":326,"width":697,"height":12}},{"id":"ac5c2ae6-ee6f-42b6-8032-2bd365b82d46","block_type":"box","text":"redemption check until good payment (that is, cash, Federal funds or certified check drawn on a U.S.","page_number":236,"box":{"x":117,"y":341,"width":753,"height":12}},{"id":"1200559a-78ac-4047-86bc-f49fc6db7b06","block_type":"box","text":"bank) has been collected for the purchase of Fund shares, which delay will usually not exceed 10","page_number":236,"box":{"x":117,"y":357,"width":726,"height":12}},{"id":"70f92da8-90c1-4566-b0ea-7c3902a093e2","block_type":"box","text":"days. If your account is held directly with the Transfer Agent and contains a fractional share balance","page_number":236,"box":{"x":116,"y":372,"width":747,"height":12}},{"id":"eb5b00b9-a0f8-41c0-b4d8-424065fd9b1b","block_type":"box","text":"following a redemption, the fractional share balance will be automatically redeemed by the Fund.","page_number":236,"box":{"x":116,"y":388,"width":722,"height":12}},{"id":"069527b2-8485-4051-aaf7-927471ce8029","block_type":"box","text":"Note on Low Balance Accounts.","page_number":236,"box":{"x":117,"y":416,"width":242,"height":9}},{"id":"ff36f5eb-b886-4c3a-9888-2e5df0f58e63","block_type":"box","text":"Because of the high cost of maintaining smaller shareholder accounts,","page_number":236,"box":{"x":360,"y":416,"width":527,"height":12}},{"id":"3b2661f6-5958-452a-ba79-ee7d08cd30b7","block_type":"box","text":"BlackRock has set a minimum balance of $500 in each Fund position you hold within your account","page_number":236,"box":{"x":117,"y":430,"width":735,"height":13}},{"id":"dbf05ec7-9c85-4e04-8938-7e002c44f59c","block_type":"box","text":"(“Fund Minimum”), and may redeem the shares in your account if the NAV of those shares in your","page_number":236,"box":{"x":117,"y":447,"width":731,"height":12}},{"id":"4bbbc1f5-ff09-4203-a829-120351fe6950","block_type":"box","text":"account falls below $500 for any reason, including market fluctuation.","page_number":236,"box":{"x":116,"y":461,"width":519,"height":13}},{"id":"41bc4a12-ecc7-4180-b5dd-f4ea140fe6ac","block_type":"box","text":"You will be notified that the value of your account is less than the Fund Minimum before the Fund","page_number":236,"box":{"x":116,"y":490,"width":727,"height":12}},{"id":"28f7a567-e50e-42d3-b08a-0876487fc782","block_type":"box","text":"makes any involuntary redemption. This notification will provide you with a 90 calendar day period to","page_number":236,"box":{"x":117,"y":506,"width":749,"height":12}},{"id":"113c5d5f-db7e-4403-a478-70eaf38a71e4","block_type":"box","text":"make an additional investment in order to bring the value of your account to at least $500 before the","page_number":236,"box":{"x":117,"y":520,"width":747,"height":13}},{"id":"6282596e-40a2-41e2-96ef-60229dca5775","block_type":"box","text":"Fund makes an involuntary redemption. This involuntary redemption will not charge any deferred sales","page_number":236,"box":{"x":117,"y":537,"width":766,"height":12}},{"id":"7cbc973e-3250-4466-8682-ef46a4033c1b","block_type":"box","text":"charge, and may not apply to accounts of certain employer-sponsored retirement plans (not including","page_number":236,"box":{"x":116,"y":552,"width":756,"height":12}},{"id":"d0fc0248-58ca-4424-baa0-55441a308633","block_type":"box","text":"IRAs), qualified state tuition plan (529 Plan) accounts, and select fee-based programs at your financial","page_number":236,"box":{"x":117,"y":568,"width":763,"height":12}},{"id":"239a7b77-72a5-4073-a989-427ec978c426","block_type":"box","text":"intermediary.","page_number":236,"box":{"x":117,"y":583,"width":101,"height":12}},{"id":"e03526a3-c41e-4631-8766-a625ee12301e","block_type":"box","text":"Repurchase","page_number":236,"box":{"x":117,"y":611,"width":100,"height":12}},{"id":"2320b6c9-5853-4cf4-8023-ca4fb5bec0bb","block_type":"box","text":"A Fund normally will accept orders to repurchase shares from Selling Dealers for their customers.","page_number":236,"box":{"x":116,"y":633,"width":729,"height":12}},{"id":"18051e3d-bb8b-4ca0-937c-3e57f4799589","block_type":"box","text":"Shares will be priced at the NAV of the Fund next determined after receipt of the repurchase order by a","page_number":236,"box":{"x":116,"y":648,"width":771,"height":12}},{"id":"5a209030-fcd7-424a-bb19-c32f8de52047","block_type":"box","text":"Selling Dealer that has been authorized by the Distributor by contract to accept such orders. As to","page_number":236,"box":{"x":116,"y":664,"width":726,"height":12}},{"id":"6038a101-1e83-4822-bfc3-18a027a887f9","block_type":"box","text":"repurchase orders received by Selling Dealers prior to the close of business on the NYSE (generally,","page_number":236,"box":{"x":117,"y":679,"width":746,"height":12}},{"id":"21a1beed-00b9-4dc4-8eda-96fa717a2550","block_type":"box","text":"the NYSE closes at 4:00 p.m. Eastern time), on the day the order is placed, which includes orders","page_number":236,"box":{"x":116,"y":695,"width":726,"height":12}},{"id":"aa0cbc59-9116-4f77-b3e1-7c1524058c66","block_type":"box","text":"received after the close of business on the previous day, the repurchase price is the NAV determined","page_number":236,"box":{"x":117,"y":710,"width":749,"height":12}},{"id":"62a86c92-6d27-48ea-b78b-d23f40e5c68d","block_type":"box","text":"as of the close of business on the NYSE on that day. If the orders for repurchase are not received by","page_number":236,"box":{"x":116,"y":726,"width":749,"height":12}},{"id":"15bcb12a-77ee-4a2a-963b-058a5b4c82ef","block_type":"box","text":"the Selling Dealer before the close of business on the NYSE, such orders are deemed received on the","page_number":236,"box":{"x":116,"y":741,"width":760,"height":12}},{"id":"1a495421-3ecb-46bd-915d-d737451cc479","block_type":"box","text":"next business day.","page_number":236,"box":{"x":117,"y":757,"width":137,"height":12}},{"id":"07d7e539-8b48-464f-919a-0c6c36b34ece","block_type":"box","text":"These repurchase arrangements are for your convenience and do not involve a charge by the Fund","page_number":236,"box":{"x":116,"y":785,"width":738,"height":12}},{"id":"3b57b31a-140b-4b09-b882-3f54dc273c37","block_type":"box","text":"(other than any applicable CDSC or redemption fee). However, Selling Dealers may charge a","page_number":236,"box":{"x":117,"y":800,"width":691,"height":12}},{"id":"96f222ee-a10a-4057-9180-599f73c2d644","block_type":"box","text":"processing fee in connection with such transactions. In addition, securities firms that do not have","page_number":236,"box":{"x":117,"y":816,"width":716,"height":12}},{"id":"4a1eb778-5aff-4c89-8fde-aa035e799ee6","block_type":"box","text":"selected dealer agreements with the Distributor may impose a transaction charge for transmitting the","page_number":236,"box":{"x":116,"y":831,"width":753,"height":12}},{"id":"30c3945a-9b03-426c-b9bd-efbfd740b98f","block_type":"box","text":"notice of repurchase to the Fund. Each Fund reserves the right to reject any order for repurchase. A","page_number":236,"box":{"x":117,"y":847,"width":746,"height":12}},{"id":"f3dd6e67-c04b-4409-9a6c-32a874e1afe5","block_type":"box","text":"shareholder whose order for repurchase is rejected by a Fund, however, may redeem shares as set","page_number":236,"box":{"x":116,"y":862,"width":746,"height":12}},{"id":"648674cc-b793-4857-86c9-fa378bfe0987","block_type":"box","text":"out above.","page_number":236,"box":{"x":116,"y":878,"width":83,"height":9}},{"id":"48c33fe0-ed75-499d-9d23-e37aa60a67ce","block_type":"box","text":"II-149","page_number":236,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"8a3780e0-9381-441e-9e70-a7fd522e688e","block_type":"box","text":"NM1026U-6004382-236/605","page_number":236,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ed4641bb-cbd1-4fea-b9cb-2a0f68f2e5c3","block_type":"box","text":"Reinstatement Privilege — Investor A and Investor P Shares","page_number":237,"box":{"x":117,"y":87,"width":484,"height":12}},{"id":"ab112d74-9a33-40e3-b85d-e5e918dda1b3","block_type":"box","text":"Upon redemption of Investor A, Investor A1, Investor P or Institutional Shares, as applicable,","page_number":237,"box":{"x":117,"y":110,"width":691,"height":12}},{"id":"014d3ddd-6687-43db-a5e9-d4885bf4787b","block_type":"box","text":"shareholders may reinvest all or a portion of their redemption proceeds (after paying any applicable","page_number":237,"box":{"x":116,"y":126,"width":743,"height":12}},{"id":"2a13df59-a571-4edd-b9b0-ae11da0e5e66","block_type":"box","text":"CDSC) in Investor A or Investor P Shares of the same or another BlackRock fund without paying a","page_number":237,"box":{"x":117,"y":141,"width":735,"height":12}},{"id":"1e0fc2e1-979e-4665-863c-2c0247c5a7bf","block_type":"box","text":"front-end sales charge. This right may be exercised within 90 days of the redemption, provided that the","page_number":237,"box":{"x":116,"y":157,"width":769,"height":12}},{"id":"951dc75d-5916-478c-b8e5-baa075a6383e","block_type":"box","text":"Investor A or Investor P Shares, as applicable, of that fund is currently open to new investors or the","page_number":237,"box":{"x":117,"y":172,"width":741,"height":12}},{"id":"155dcf40-7bc4-4368-9a9f-a7333b4b29b7","block_type":"box","text":"shareholder has a current account in that closed fund. Shares will be purchased at the NAV calculated","page_number":237,"box":{"x":116,"y":188,"width":765,"height":12}},{"id":"2ff75b3b-c043-4a3a-a70f-1cabe2ba71cf","block_type":"box","text":"at the close of trading on the day the request is received in good order. To exercise this privilege, the","page_number":237,"box":{"x":116,"y":203,"width":754,"height":12}},{"id":"554e1c61-7e62-4ae1-bb6e-ad0c44535298","block_type":"box","text":"Transfer Agent must receive written notification from the shareholder of record or the registered","page_number":237,"box":{"x":116,"y":219,"width":714,"height":12}},{"id":"1c5b963d-f6b2-4e67-948b-e0764b846175","block_type":"box","text":"representative of record, at the time of purchase. Investors should consult a tax advisor concerning the","page_number":237,"box":{"x":117,"y":234,"width":767,"height":12}},{"id":"bf083149-1028-43b0-b9bc-165f3dce80c3","block_type":"box","text":"tax consequences of exercising this reinstatement privilege.","page_number":237,"box":{"x":116,"y":250,"width":449,"height":12}},{"id":"67f870bb-31a6-48e7-84c5-14df06ba681c","block_type":"box","text":"S","page_number":237,"box":{"x":409,"y":296,"width":9,"height":10}},{"id":"9a59d87b-103f-4e7f-ac93-ade423efa7df","block_type":"box","text":"HAREHOLDER","page_number":237,"box":{"x":420,"y":299,"width":95,"height":7}},{"id":"4fd308d6-f3d5-47c6-ba26-e65a9134e7a5","block_type":"box","text":"S","page_number":237,"box":{"x":515,"y":296,"width":16,"height":10}},{"id":"0b7317b5-0cf7-4d1b-bccb-17e8565472dd","block_type":"box","text":"ERVICES","page_number":237,"box":{"x":532,"y":299,"width":59,"height":7}},{"id":"71e45506-489b-4acb-8a27-d15f604dac4c","block_type":"box","text":"Each Fund offers one or more of the shareholder services described below that are designed to","page_number":237,"box":{"x":117,"y":327,"width":714,"height":12}},{"id":"ecadaad4-839d-42a1-86fc-54d154f36592","block_type":"box","text":"facilitate investment in its shares. You can obtain more information about these services from each","page_number":237,"box":{"x":116,"y":343,"width":738,"height":9}},{"id":"14ed10f8-642c-4adf-ae05-147cad6a2736","block_type":"box","text":"Fund by calling the telephone number on the cover page, or from the Distributor, your financial adviser,","page_number":237,"box":{"x":117,"y":358,"width":769,"height":12}},{"id":"c9b95b79-0e0a-494a-9721-525e2fc17e7c","block_type":"box","text":"your selected securities dealer or other financial intermediary. Certain of these services are available","page_number":237,"box":{"x":116,"y":374,"width":753,"height":12}},{"id":"83f1c698-051c-424a-a6ef-f3719765f598","block_type":"box","text":"only to U.S. investors.","page_number":237,"box":{"x":116,"y":389,"width":168,"height":12}},{"id":"1620e618-056a-45bd-8d6c-bcf91669c404","block_type":"box","text":"Investment Account","page_number":237,"box":{"x":117,"y":420,"width":164,"height":10}},{"id":"e7da6b56-e025-4f26-8080-1e52a578124e","block_type":"box","text":"If your account is maintained at the Transfer Agent (an “Investment Account”) you will receive","page_number":237,"box":{"x":117,"y":444,"width":698,"height":12}},{"id":"9c7b1451-a815-46a6-a851-539e2ca5d520","block_type":"box","text":"statements, at least quarterly, from the Transfer Agent. These statements will serve as confirmations","page_number":237,"box":{"x":116,"y":459,"width":752,"height":12}},{"id":"bcfabc9e-0b4f-48b5-b468-544bfdcc80a0","block_type":"box","text":"for automatic investment purchases and the reinvestment of dividends. The statements also will show","page_number":237,"box":{"x":116,"y":475,"width":760,"height":12}},{"id":"95b2a5ad-ae2b-4d83-b7e8-43e6dba08870","block_type":"box","text":"any other activity in your Investment Account since the last statement. You also will receive separate","page_number":237,"box":{"x":116,"y":490,"width":752,"height":12}},{"id":"33df8821-1071-4bd5-8ca9-e19330da9d86","block_type":"box","text":"confirmations for each purchase or sale transaction other than automatic investment purchases and","page_number":237,"box":{"x":116,"y":506,"width":746,"height":12}},{"id":"d9f31639-8bc5-4ff4-be3d-bdb0d61d0d94","block_type":"box","text":"the reinvestment of dividends. If your Investment Account is held at the Transfer Agent you may make","page_number":237,"box":{"x":116,"y":521,"width":763,"height":12}},{"id":"bdf34e0e-3aae-405a-af73-088802db18cd","block_type":"box","text":"additions to it at any time by mailing a check directly to the Transfer Agent. Each Fund limits purchases","page_number":237,"box":{"x":116,"y":537,"width":771,"height":12}},{"id":"90acad06-785c-436a-a09b-f24953839dfb","block_type":"box","text":"by personal check to $500,000 per trade. You may also maintain an account through a selected","page_number":237,"box":{"x":117,"y":551,"width":715,"height":13}},{"id":"1e0fc482-6ecb-43a6-83f0-d388f8b837de","block_type":"box","text":"securities dealer or other financial intermediary. If you transfer shares out of an account maintained","page_number":237,"box":{"x":116,"y":568,"width":742,"height":12}},{"id":"c95b1665-9e9c-4ca5-aa37-acfa64fb9ad8","block_type":"box","text":"with a selected securities dealer or other financial intermediary, an Investment Account in your name","page_number":237,"box":{"x":116,"y":583,"width":752,"height":12}},{"id":"1cd27080-cd16-452d-bc94-69b9822dfaa4","block_type":"box","text":"may be opened automatically at the Transfer Agent.","page_number":237,"box":{"x":117,"y":599,"width":390,"height":12}},{"id":"f936a82f-5a92-4872-a1d4-d3091428e6e6","block_type":"box","text":"You may transfer Fund shares from a selected securities dealer or other financial intermediary to","page_number":237,"box":{"x":116,"y":630,"width":723,"height":12}},{"id":"92eb5efe-7cc9-42d4-9eb4-967e0baa072e","block_type":"box","text":"another securities dealer or other financial intermediary that has entered into an agreement with the","page_number":237,"box":{"x":116,"y":645,"width":745,"height":12}},{"id":"e463efc5-4553-4625-9b29-71fbf1afb2a1","block_type":"box","text":"Distributor. Certain shareholder services may not be available for the transferred shares. All future","page_number":237,"box":{"x":117,"y":661,"width":727,"height":12}},{"id":"5ee07acb-8982-41d8-9d83-eff2f2a214b9","block_type":"box","text":"trading of these assets must be coordinated by the new firm. If you wish to transfer your shares to a","page_number":237,"box":{"x":116,"y":676,"width":740,"height":12}},{"id":"0ada19d0-43b3-4d57-b4c3-4af4bbdca834","block_type":"box","text":"securities dealer or other financial intermediary that has not entered into an agreement with the","page_number":237,"box":{"x":116,"y":692,"width":706,"height":12}},{"id":"6d324fa3-0ca2-4ca2-9bf6-bf974968519b","block_type":"box","text":"Distributor, you must either (i) redeem your shares, paying any applicable CDSC or (ii) continue to","page_number":237,"box":{"x":117,"y":707,"width":727,"height":12}},{"id":"d02aeb41-5d15-462e-9f68-5bbc70f50531","block_type":"box","text":"maintain an Investment Account at the Transfer Agent for those shares. You also may request that the","page_number":237,"box":{"x":117,"y":723,"width":759,"height":12}},{"id":"f3527930-0f31-4e65-9819-a84f0082fe50","block_type":"box","text":"new securities dealer or other financial intermediary maintain the shares in an account at the Transfer","page_number":237,"box":{"x":117,"y":738,"width":754,"height":12}},{"id":"0fce668b-06fe-4690-aaeb-92893067bd2d","block_type":"box","text":"Agent registered in the name of the securities dealer or other financial intermediary for your benefit","page_number":237,"box":{"x":116,"y":754,"width":733,"height":12}},{"id":"4e921e38-1ad8-424f-a9bd-f3efd7671282","block_type":"box","text":"whether the securities dealer or other financial intermediary has entered into a selected dealer","page_number":237,"box":{"x":116,"y":769,"width":700,"height":12}},{"id":"c94400d2-a89b-4352-b13f-503e3ad5a0a5","block_type":"box","text":"agreement or not. In the interest of economy and convenience and because of the operating","page_number":237,"box":{"x":116,"y":785,"width":685,"height":12}},{"id":"125ff172-c4fb-467c-93d3-67fc6eedaad9","block_type":"box","text":"procedures of each Fund, share certificates will not be issued physically. Shares are maintained by","page_number":237,"box":{"x":117,"y":800,"width":734,"height":12}},{"id":"f935a49d-732d-42cc-aa5e-f5865305a80c","block_type":"box","text":"each Fund on its register maintained by the Transfer Agent and the holders thereof will have the same","page_number":237,"box":{"x":116,"y":816,"width":759,"height":12}},{"id":"2abdbd0c-30ed-4bd2-a695-894bdb683cf8","block_type":"box","text":"rights and ownership with respect to such shares as if certificates had been issued.","page_number":237,"box":{"x":117,"y":831,"width":621,"height":12}},{"id":"1f4b6510-52a6-4a1a-8694-a4bb50b03857","block_type":"box","text":"If you are considering transferring a tax-deferred retirement account, such as an individual retirement","page_number":237,"box":{"x":117,"y":862,"width":754,"height":12}},{"id":"4ce23b02-2f9c-401c-b0e8-940df6e0d1db","block_type":"box","text":"account, from one selected securities dealer to another securities dealer or other financial","page_number":237,"box":{"x":116,"y":878,"width":671,"height":11}},{"id":"8564454d-e257-4606-a6da-be80aa418c16","block_type":"box","text":"II-150","page_number":237,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"ee426b96-e774-4b69-8e6c-48b51027c243","block_type":"box","text":"NM1026U-6004382-237/605","page_number":237,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c56da56f-d1fd-4915-ab4c-522f399696be","block_type":"box","text":"intermediary, you should be aware that if the new firm will not take delivery of shares of the Fund, you","page_number":238,"box":{"x":117,"y":87,"width":759,"height":12}},{"id":"8958ad07-20f4-4c10-a306-9c9319e08f27","block_type":"box","text":"must either redeem the shares (paying any applicable CDSC) so that the cash proceeds can be","page_number":238,"box":{"x":117,"y":102,"width":714,"height":13}},{"id":"16c19df5-8fff-409b-a4c1-e63eae1f31a2","block_type":"box","text":"transferred to the account at the new firm, or you must continue to maintain a retirement account at the","page_number":238,"box":{"x":116,"y":118,"width":770,"height":12}},{"id":"1c28bbb6-c401-4e54-bc04-fa1a21bacac2","block_type":"box","text":"original selected securities dealer for those shares.","page_number":238,"box":{"x":116,"y":134,"width":383,"height":12}},{"id":"fc7691bb-7d8e-4990-825b-613928f5aba8","block_type":"box","text":"Exchange Privilege","page_number":238,"box":{"x":117,"y":165,"width":158,"height":12}},{"id":"89717509-7741-45fb-8082-653b3f15aaba","block_type":"box","text":"U.S. shareholders of Investor A, Investor A1, Investor C, Investor P, Class K, Institutional and Class G","page_number":238,"box":{"x":117,"y":192,"width":763,"height":11}},{"id":"66b44252-25a6-4954-b598-94ada208eea0","block_type":"box","text":"Shares of each Fund have an exchange privilege with certain other Funds. However, Investor A1","page_number":238,"box":{"x":116,"y":207,"width":725,"height":12}},{"id":"661c181e-cbd0-4f68-b346-b1c78a3ed500","block_type":"box","text":"Shares may only exchange out. The minimum amount for exchanges of Investor class shares is","page_number":238,"box":{"x":116,"y":223,"width":717,"height":12}},{"id":"2a36ce52-1cda-45ef-b2c8-3da5cee7bfe2","block_type":"box","text":"$1,000, although you may exchange less than $1,000 if you already have an account in the Fund into","page_number":238,"box":{"x":116,"y":237,"width":758,"height":13}},{"id":"87f57137-0abb-4268-8459-7299bbedeb89","block_type":"box","text":"which you are exchanging. You may only exchange into a share class and a Fund that are open to new","page_number":238,"box":{"x":116,"y":254,"width":772,"height":12}},{"id":"e25d223c-0f86-47bf-be98-3a52adb47b57","block_type":"box","text":"investors or in which you have a current account if the class or fund is closed to new investors. Before","page_number":238,"box":{"x":117,"y":269,"width":761,"height":12}},{"id":"4a6b0b39-8ab7-4030-bcd5-eee37cfab589","block_type":"box","text":"effecting an exchange, you should obtain a currently effective prospectus of the fund into which you","page_number":238,"box":{"x":116,"y":285,"width":744,"height":12}},{"id":"d3fcc809-c5b5-4fbd-ae2c-08b40887d5d9","block_type":"box","text":"wish to make the exchange. Exercise of the exchange privilege is treated as a sale of the exchanged","page_number":238,"box":{"x":116,"y":300,"width":754,"height":12}},{"id":"fb236b9d-745c-4062-baa7-b655c428de9b","block_type":"box","text":"shares and a purchase of the acquired shares for U.S. federal income tax purposes.","page_number":238,"box":{"x":116,"y":316,"width":630,"height":12}},{"id":"a0f16243-b010-4f91-8653-db98491636e0","block_type":"box","text":"Exchanges of Investor A, Investor A1, Investor P, Class K, Institutional and Class G Shares.","page_number":238,"box":{"x":116,"y":347,"width":689,"height":13}},{"id":"88efcba4-8f09-4afa-848b-0e070061d845","block_type":"box","text":"Institutional Shares are exchangeable with Institutional Shares of other Funds. Investor A and Investor","page_number":238,"box":{"x":117,"y":363,"width":763,"height":12}},{"id":"210989af-f725-4465-968b-2752246f8c42","block_type":"box","text":"A1 Shares are exchangeable for Investor A Shares of other Funds to the extent such shares are","page_number":238,"box":{"x":116,"y":378,"width":719,"height":13}},{"id":"e8b35046-f9a0-441c-81a5-4a3f7564daed","block_type":"box","text":"offered by your financial intermediary. Investor P Shares are exchangeable for Investor P Shares of","page_number":238,"box":{"x":116,"y":394,"width":744,"height":12}},{"id":"fedd3f58-b462-43ef-ad7e-57c126c0be91","block_type":"box","text":"other Funds, to the extent such shares are offered by your financial intermediary. Class K Shares are","page_number":238,"box":{"x":116,"y":409,"width":756,"height":13}},{"id":"60f843ce-ebcc-4ccf-b172-fb68b38384be","block_type":"box","text":"exchangeable for Class K Shares of other Funds. Class G Shares are exchangeable for Class G","page_number":238,"box":{"x":116,"y":425,"width":722,"height":12}},{"id":"ffbda200-d981-420d-95a1-cb2b40e704a9","block_type":"box","text":"Shares of other Funds.","page_number":238,"box":{"x":116,"y":440,"width":176,"height":10}},{"id":"6a7e0636-ef46-4c14-a688-cdd0ca485cd9","block_type":"box","text":"Exchanges of Institutional Shares outstanding for Institutional Shares of a second fund or for shares of","page_number":238,"box":{"x":117,"y":472,"width":764,"height":12}},{"id":"a181daf8-35e5-42e5-b13b-2ea1c1d93171","block_type":"box","text":"a money market fund are effected on the basis of relative NAV per Institutional Share. Exchanges of","page_number":238,"box":{"x":116,"y":488,"width":748,"height":12}},{"id":"8047bcb2-14bf-4a48-8769-4aee19491765","block_type":"box","text":"Investor A or Investor A1 Shares outstanding (“outstanding Investor A Shares”) for Investor A Shares","page_number":238,"box":{"x":117,"y":503,"width":754,"height":12}},{"id":"cd3eedb5-cc5f-4347-8dca-55266919cc8c","block_type":"box","text":"of a second fund, or for shares of a money market fund (“new Investor A Shares”) are effected on the","page_number":238,"box":{"x":116,"y":519,"width":756,"height":12}},{"id":"4b3c38b1-78d5-4230-9514-2cf948045718","block_type":"box","text":"basis of relative NAV per share. Exchanges of Investor P Shares outstanding for Investor P Shares of","page_number":238,"box":{"x":117,"y":534,"width":759,"height":12}},{"id":"1dc0dc68-21ff-4f01-8b16-f09618bf360e","block_type":"box","text":"a second fund are effected on the basis of relative NAV per share. Exchanges of Class K Shares","page_number":238,"box":{"x":116,"y":550,"width":724,"height":12}},{"id":"51cf12b5-af48-4fa6-b7aa-b84b53e97d86","block_type":"box","text":"outstanding for Class K Shares of a second fund, or","page_number":238,"box":{"x":116,"y":565,"width":390,"height":12}},{"id":"730ea917-077f-48a4-ab1c-388448faf7ab","block_type":"box","text":"for shares of a money market fund are effected on","page_number":238,"box":{"x":506,"y":565,"width":378,"height":12}},{"id":"6d903f2c-e89f-4507-b394-51a8f4e89188","block_type":"box","text":"the basis of relative NAV per share. Exchanges of Class G Shares outstanding for Class G Shares of a","page_number":238,"box":{"x":116,"y":581,"width":770,"height":12}},{"id":"d4084b86-e724-4e4e-9318-bf2d7119ce37","block_type":"box","text":"second fund are effected on the basis of relative NAV per share.","page_number":238,"box":{"x":116,"y":596,"width":483,"height":12}},{"id":"90c661b2-e37b-485b-bb77-a39a38eafaf2","block_type":"box","text":"Exchanges of Investor C Shares.","page_number":238,"box":{"x":116,"y":628,"width":250,"height":12}},{"id":"4d5ed2e8-be41-4232-a1f1-07b1edd9fa22","block_type":"box","text":"Shareholders of certain Funds with Investor C Shares outstanding","page_number":238,"box":{"x":367,"y":628,"width":495,"height":12}},{"id":"e3ca4d7c-a72f-4aa1-856e-ce70a17938a3","block_type":"box","text":"(“outstanding Investor C Shares”) may exchange their shares for Investor C Shares of a second Fund","page_number":238,"box":{"x":117,"y":644,"width":758,"height":12}},{"id":"f62880f7-595d-4a35-88f0-1f3545ab396b","block_type":"box","text":"(“new Investor C Shares”) or for shares of a money market fund (“new money market fund Shares”) on","page_number":238,"box":{"x":117,"y":659,"width":766,"height":12}},{"id":"f3a8bbc0-4fe5-4959-838d-f684321871c8","block_type":"box","text":"the basis of relative NAV per share, without the payment of any CDSC. Certain Funds impose different","page_number":238,"box":{"x":116,"y":675,"width":762,"height":12}},{"id":"21ebdae5-4f86-480d-8d64-594495732989","block_type":"box","text":"CDSC schedules. For purposes of computing the CDSC upon redemption of new Investor C Shares or","page_number":238,"box":{"x":117,"y":690,"width":761,"height":12}},{"id":"e999c975-eea6-4370-9026-b4281e66a6c7","block_type":"box","text":"new money market fund Shares, as applicable, the time you held both the exchanged Investor C","page_number":238,"box":{"x":117,"y":706,"width":715,"height":12}},{"id":"1dea79be-5aac-480f-89d5-6ca652536602","block_type":"box","text":"Shares and the new Investor C Shares or new money market fund Shares will count towards the","page_number":238,"box":{"x":116,"y":721,"width":716,"height":12}},{"id":"bbaef4ab-4237-49c7-a62b-3eb1721be219","block_type":"box","text":"holding period of the new Investor C Shares or new money market fund Shares.","page_number":238,"box":{"x":117,"y":737,"width":591,"height":12}},{"id":"b6ab05e9-8c4f-4955-840a-6214e6beda3f","block_type":"box","text":"Exchanges of Service Shares.","page_number":238,"box":{"x":116,"y":768,"width":223,"height":12}},{"id":"4a1bed21-50e5-4a97-8f81-a892ae04a738","block_type":"box","text":"Service Shares can be exchanged for Service Shares of Funds that are","page_number":238,"box":{"x":347,"y":768,"width":530,"height":12}},{"id":"0abe43cb-52ca-4901-a222-b2e0f63515db","block_type":"box","text":"covered by selected dealer agreements with the Distributor.","page_number":238,"box":{"x":116,"y":784,"width":442,"height":12}},{"id":"41d3b764-cb98-48c1-9f2b-8c8c67cef6d6","block_type":"box","text":"Exchanges for Shares of a Money Market Fund.","page_number":238,"box":{"x":116,"y":816,"width":356,"height":12}},{"id":"213c3433-4bf1-43c3-9783-ceb6b6c0505f","block_type":"box","text":"You may exchange any class of Investor class shares,","page_number":238,"box":{"x":478,"y":816,"width":404,"height":12}},{"id":"4ea27200-36fd-4bf1-8edd-cc2b1865b582","block_type":"box","text":"excluding Investor P Shares, for shares of an affiliated money market fund. If you exchange into","page_number":238,"box":{"x":116,"y":831,"width":717,"height":12}},{"id":"a42efdf8-21f3-4052-895f-985354edb174","block_type":"box","text":"BlackRock Summit Cash Reserves Fund (“Summit”), a series of BlackRock Financial Institutions","page_number":238,"box":{"x":117,"y":847,"width":720,"height":12}},{"id":"c5461eb3-d840-4184-b022-5d9c160f8189","block_type":"box","text":"Series Trust, you will receive one of two classes of shares: exchanges of Investor A, Investor A1 and","page_number":238,"box":{"x":116,"y":862,"width":753,"height":12}},{"id":"e1d07b98-16e5-4e92-a2a4-829bef9c5ea0","block_type":"box","text":"Institutional Shares of a Fund will receive Investor A Shares of Summit and exchanges of Investor C","page_number":238,"box":{"x":117,"y":878,"width":747,"height":12}},{"id":"6e3d0857-85ac-42c8-92fd-e1b97ec82a19","block_type":"box","text":"II-151","page_number":238,"box":{"x":480,"y":909,"width":38,"height":9}},{"id":"1b72a084-6b53-4799-b4aa-1b26fa1f923c","block_type":"box","text":"NM1026U-6004382-238/605","page_number":238,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5132d61b-54c5-4989-bf47-4aa44c72752b","block_type":"box","text":"Shares of a Fund will receive Investor C Shares of Summit. You may exchange Investor A Shares of","page_number":239,"box":{"x":116,"y":87,"width":751,"height":12}},{"id":"567649b9-9565-4f3f-a28c-f8263681b423","block_type":"box","text":"Summit back into Investor A or Institutional Shares of a Fund, if you are eligible to hold such shares.","page_number":239,"box":{"x":116,"y":102,"width":748,"height":13}},{"id":"8c0a7183-7333-4cd5-bade-ac8d1f8aa2e7","block_type":"box","text":"You may exchange Investor C Shares of Summit back into Investor C Shares of a Fund and, in the","page_number":239,"box":{"x":116,"y":118,"width":739,"height":12}},{"id":"17afdb7c-25da-4fdb-b7b9-f9875a9aa43f","block_type":"box","text":"event of such an exchange, the period of time that you held Investor C Shares of Summit will count","page_number":239,"box":{"x":116,"y":134,"width":740,"height":12}},{"id":"3f25070d-951f-45bc-b0ab-9845189eeeda","block_type":"box","text":"toward satisfaction of the holding period requirement for purposes of reducing any CDSC. Investor C","page_number":239,"box":{"x":116,"y":149,"width":752,"height":12}},{"id":"04127419-b309-4930-9c3a-8bf0d0a54380","block_type":"box","text":"Shares of Summit are subject to a distribution fee at an annual rate of 0.75% of average daily net","page_number":239,"box":{"x":116,"y":165,"width":726,"height":12}},{"id":"dd77b246-2b3c-4d39-aa7c-359cea17bc03","block_type":"box","text":"assets of such Investor C Shares. Exchanges of Investor C Shares of a money market fund other than","page_number":239,"box":{"x":116,"y":180,"width":765,"height":12}},{"id":"efa94650-257b-4752-ac54-af7928dcd132","block_type":"box","text":"Summit for Investor C Shares of a Fund will be exercised at NAV. However, a CDSC may be charged","page_number":239,"box":{"x":116,"y":196,"width":759,"height":12}},{"id":"7a456a29-0e53-4bdd-ba6a-765afb760390","block_type":"box","text":"in connection with any subsequent redemption of the Investor C Shares of the Fund received in the","page_number":239,"box":{"x":117,"y":211,"width":740,"height":12}},{"id":"a3a1bc3a-cdf7-4c28-9ffc-3810f9b531bd","block_type":"box","text":"exchange. In determining the holding period for calculating the CDSC payable on redemption of","page_number":239,"box":{"x":116,"y":227,"width":715,"height":12}},{"id":"bdc1c978-a9ed-4429-8f96-e94edcc5dd68","block_type":"box","text":"Investor C Shares of the Fund received in the exchange, the holding period of the money market fund","page_number":239,"box":{"x":117,"y":242,"width":759,"height":12}},{"id":"959377b0-4560-49e5-8ef6-5e445a8616b6","block_type":"box","text":"Investor C Shares originally held will be added to the holding period of the Investor C Shares acquired","page_number":239,"box":{"x":117,"y":258,"width":761,"height":12}},{"id":"5cca1373-102b-41b8-a263-ed2660587f7c","block_type":"box","text":"through exchange.","page_number":239,"box":{"x":116,"y":273,"width":144,"height":12}},{"id":"8a0f559c-d854-48a0-a546-b30f3e96cb29","block_type":"box","text":"Exchanges by Participants in Certain Programs.","page_number":239,"box":{"x":116,"y":304,"width":362,"height":12}},{"id":"d67e2d8c-e2c7-4f83-94a5-f6fb1581e76b","block_type":"box","text":"The exchange privilege may be modified with respect","page_number":239,"box":{"x":478,"y":304,"width":401,"height":12}},{"id":"b35be6e1-5867-43bc-89d0-eb6f1bb2941e","block_type":"box","text":"to certain participants in mutual fund advisory programs and other fee-based programs sponsored by","page_number":239,"box":{"x":116,"y":320,"width":755,"height":12}},{"id":"e7e577a1-36cf-42a6-9da7-f16ffa9b5b47","block_type":"box","text":"the Manager, an affiliate of the Manager, or selected securities dealers or other financial intermediaries","page_number":239,"box":{"x":116,"y":335,"width":770,"height":12}},{"id":"57f1a573-0420-44b5-96a4-e9dc23f6b782","block_type":"box","text":"that have an agreement with the Distributor. See “Fee-Based Programs” below.","page_number":239,"box":{"x":116,"y":351,"width":595,"height":12}},{"id":"9f4ec616-0ee2-4dc5-a2b4-515f0292a6a8","block_type":"box","text":"Exercise of the Exchange Privilege.","page_number":239,"box":{"x":116,"y":382,"width":269,"height":12}},{"id":"e34b0fe3-1a14-46cf-8397-c9f6d8a3caeb","block_type":"box","text":"To exercise the exchange privilege, you should contact your","page_number":239,"box":{"x":385,"y":382,"width":452,"height":12}},{"id":"59ba4533-962e-4d0e-abd4-cbb0aa335ebe","block_type":"box","text":"financial adviser or the Transfer Agent, who will advise each Fund of the exchange. If you do not hold","page_number":239,"box":{"x":116,"y":397,"width":758,"height":12}},{"id":"a533d005-bb57-4b67-98f2-913c7d91aded","block_type":"box","text":"share certificates, you may exercise the exchange privilege by wire through your securities dealer or","page_number":239,"box":{"x":116,"y":413,"width":749,"height":12}},{"id":"63373359-211d-4adb-8ac0-dc0d67c030a3","block_type":"box","text":"other financial intermediary. Each Fund reserves the right to require a properly completed exchange","page_number":239,"box":{"x":116,"y":428,"width":747,"height":12}},{"id":"dc24f79f-56f7-42df-b6b5-db3d03883f59","block_type":"box","text":"application.","page_number":239,"box":{"x":116,"y":444,"width":89,"height":12}},{"id":"d3591656-786b-482b-93ae-624a13876f65","block_type":"box","text":"A shareholder who wishes to make an exchange may do so by sending a written request to the Fund c/","page_number":239,"box":{"x":116,"y":475,"width":767,"height":12}},{"id":"0a503baf-3604-47d7-b50a-3b279aea6bc6","block_type":"box","text":"o the Transfer Agent at the following address: P.O. Box 534429, Pittsburgh, Pennsylvania 15253-4429.","page_number":239,"box":{"x":116,"y":490,"width":771,"height":12}},{"id":"e77470ed-9431-4697-baf3-c9eb1616ac31","block_type":"box","text":"Shareholders are automatically provided with telephone exchange privileges when opening an","page_number":239,"box":{"x":116,"y":506,"width":705,"height":12}},{"id":"f4647ea6-49bf-4f85-a18b-0ef20cabce0b","block_type":"box","text":"account, unless they indicate on the Application that they do not wish to use this privilege. To add this","page_number":239,"box":{"x":116,"y":521,"width":759,"height":12}},{"id":"88a1fae7-5dc2-4a4d-a96b-7ba87539cc85","block_type":"box","text":"feature to an existing account that previously did not provide this option, a Telephone Exchange","page_number":239,"box":{"x":116,"y":537,"width":716,"height":12}},{"id":"932838e5-4305-4eba-8007-6b94f48570a4","block_type":"box","text":"Authorization Form must be filed with the Transfer Agent. This form is available from the Transfer","page_number":239,"box":{"x":116,"y":552,"width":727,"height":12}},{"id":"4a731805-f0d1-4af4-bbd4-4c0cf2ae3072","block_type":"box","text":"Agent. Once this election has been made, the shareholder may simply contact the Fund by telephone","page_number":239,"box":{"x":116,"y":568,"width":759,"height":12}},{"id":"68da293e-3e26-4f00-9233-9cac5868c415","block_type":"box","text":"at (800) 441-7762 to request the exchange. During periods of substantial economic or market change,","page_number":239,"box":{"x":116,"y":583,"width":763,"height":12}},{"id":"f6005f81-3691-46ca-a68a-8c39f63473c1","block_type":"box","text":"telephone exchanges may be difficult to complete and shareholders may have to submit exchange","page_number":239,"box":{"x":116,"y":599,"width":736,"height":12}},{"id":"fc7b901f-3837-42e4-ab60-fc9d76d50663","block_type":"box","text":"requests to the Transfer Agent in writing.","page_number":239,"box":{"x":117,"y":614,"width":307,"height":12}},{"id":"aa0ba797-ee19-44d7-b719-f29a828d15d6","block_type":"box","text":"If the exchanging shareholder does not currently own shares of the investment portfolio whose shares","page_number":239,"box":{"x":117,"y":645,"width":760,"height":12}},{"id":"1241da41-1bde-4410-a95e-4073ea353d6d","block_type":"box","text":"are being acquired, a new account will be established with the same registration, dividend and capital","page_number":239,"box":{"x":116,"y":661,"width":751,"height":12}},{"id":"06bd9840-bc37-45b5-8df0-2a603dd537be","block_type":"box","text":"gain options and broker of record as the account from which shares are exchanged, unless otherwise","page_number":239,"box":{"x":116,"y":676,"width":752,"height":12}},{"id":"0f244d81-d2c8-4fc2-9e85-20deac6b37c1","block_type":"box","text":"specified in writing by the shareholder with all signatures guaranteed by an eligible guarantor institution","page_number":239,"box":{"x":116,"y":692,"width":764,"height":12}},{"id":"103b38a7-fc14-4106-9ce3-76f10e741658","block_type":"box","text":"as defined below. In order to participate in the Automatic Investment Program or establish a","page_number":239,"box":{"x":116,"y":707,"width":680,"height":12}},{"id":"96e248ac-2590-4563-8812-9a4fca0c288b","block_type":"box","text":"Systematic Withdrawal Plan for the new account, however, an exchanging shareholder must file a","page_number":239,"box":{"x":116,"y":723,"width":726,"height":12}},{"id":"3581444a-c3aa-4d14-95de-8a9b2f6d10a5","block_type":"box","text":"specific written request.","page_number":239,"box":{"x":116,"y":738,"width":174,"height":12}},{"id":"cdbcc95f-b975-4987-8281-a5a77cf5740f","block_type":"box","text":"Any share exchange must satisfy the requirements relating to the minimum initial investment","page_number":239,"box":{"x":116,"y":769,"width":686,"height":12}},{"id":"d5d20eb9-f969-40c6-b5e6-18c71ab60d0b","block_type":"box","text":"requirement, and must be legally available for sale in the state of the investor’s residence. For U.S.","page_number":239,"box":{"x":117,"y":785,"width":732,"height":12}},{"id":"3aaaae3c-2188-4c43-a13e-aa13fbee6643","block_type":"box","text":"federal income tax purposes, a share exchange is a taxable event and, accordingly, a capital gain or","page_number":239,"box":{"x":116,"y":800,"width":746,"height":12}},{"id":"a404d3da-d9fa-4aff-931e-b49aa860ea47","block_type":"box","text":"loss may be realized. Before making an exchange request, shareholders should consult a tax or other","page_number":239,"box":{"x":117,"y":816,"width":755,"height":12}},{"id":"b857e482-b055-4c69-a6e2-6f9fbd2077d1","block_type":"box","text":"financial adviser and should consider the investment objective, policies and restrictions of the","page_number":239,"box":{"x":116,"y":831,"width":697,"height":12}},{"id":"c4b4394a-5202-4446-a2a3-56c7babb9735","block_type":"box","text":"investment portfolio into which the shareholder is making an exchange. Brokers may charge a fee for","page_number":239,"box":{"x":117,"y":847,"width":754,"height":12}},{"id":"2be68d7a-478b-4a2f-bf22-372597a34eda","block_type":"box","text":"handling exchanges.","page_number":239,"box":{"x":117,"y":862,"width":158,"height":12}},{"id":"29c1b488-84f9-4eef-b6a9-a17b91263d65","block_type":"box","text":"II-152","page_number":239,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"a366ca12-efd9-492a-af46-36a85bdbda4e","block_type":"box","text":"NM1026U-6004382-239/605","page_number":239,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"44c6ae6b-ea75-4072-85b8-c329b9ac2929","block_type":"box","text":"The Funds reserve the right to suspend, modify or terminate the exchange privilege at any time. Notice","page_number":240,"box":{"x":116,"y":87,"width":769,"height":12}},{"id":"98f5befe-6967-485c-b9b9-46e5e4085b39","block_type":"box","text":"will be given to shareholders of any material modification or termination except where notice is not","page_number":240,"box":{"x":116,"y":102,"width":733,"height":13}},{"id":"96b14145-3fa5-4f24-b854-1493b64ad4ed","block_type":"box","text":"required. The Funds reserve the right to reject any telephone exchange request. Telephone exchanges","page_number":240,"box":{"x":117,"y":118,"width":770,"height":12}},{"id":"4cf4fd29-ca49-4952-b165-2f92aed2d567","block_type":"box","text":"may be subject to limitations as to amount or frequency, and to other restrictions that may be","page_number":240,"box":{"x":117,"y":134,"width":693,"height":12}},{"id":"a8abc3a3-07e8-4638-80df-520135dcc717","block_type":"box","text":"established from time to time to ensure that exchanges do not operate to the disadvantage of any","page_number":240,"box":{"x":116,"y":149,"width":729,"height":12}},{"id":"52fbcb9f-1ad9-4b49-a94f-d37c18ee04ad","block_type":"box","text":"portfolio or its shareholders.","page_number":240,"box":{"x":117,"y":165,"width":211,"height":11}},{"id":"c212758e-7e3f-4549-a4b2-79bffed3ff78","block_type":"box","text":"The Funds, the Administrators and BRIL will employ reasonable procedures to confirm that instructions","page_number":240,"box":{"x":116,"y":194,"width":770,"height":12}},{"id":"6f54bca7-77e0-4efe-b998-03c7e327e2f3","block_type":"box","text":"communicated by telephone are genuine. The Funds, the Administrators and BRIL will not be liable for","page_number":240,"box":{"x":116,"y":210,"width":766,"height":12}},{"id":"b7cbebb0-c69a-441d-b6f0-fda6a50e50ac","block_type":"box","text":"any loss, liability, cost or expense for acting upon telephone instructions reasonably believed to be","page_number":240,"box":{"x":116,"y":225,"width":735,"height":12}},{"id":"ea1ecedb-0da5-474c-8d4c-f967345b9ecc","block_type":"box","text":"genuine in accordance with such procedures. By use of the exchange privilege, the investor authorizes","page_number":240,"box":{"x":116,"y":241,"width":769,"height":12}},{"id":"253c9618-8c02-47aa-8225-b99951163872","block_type":"box","text":"the Fund’s Transfer Agent to act on telephonic or written exchange instructions from any person","page_number":240,"box":{"x":116,"y":256,"width":718,"height":12}},{"id":"d7c512d9-fa7a-43bb-bcf0-2429e4002ecc","block_type":"box","text":"representing himself to be the investor and believed by the Fund’s Transfer Agent to be genuine. The","page_number":240,"box":{"x":117,"y":272,"width":756,"height":12}},{"id":"a7219dff-db6a-4b4e-abeb-88b90bf826b1","block_type":"box","text":"records of the Fund’s Transfer Agent pertaining to such instructions are binding. The exchange","page_number":240,"box":{"x":117,"y":287,"width":709,"height":12}},{"id":"5253d219-4504-40e7-9c7b-2dd677f737f8","block_type":"box","text":"privilege may be modified or terminated at any time upon 60 days’ notice to affected shareholders. The","page_number":240,"box":{"x":117,"y":303,"width":768,"height":12}},{"id":"4a39f91e-cccf-4ad7-b639-88107b4a8e6d","block_type":"box","text":"exchange privilege is only available in states where the exchange may legally be made.","page_number":240,"box":{"x":116,"y":318,"width":655,"height":12}},{"id":"1e07e55e-4ecd-41e6-9b82-f4a5da8da6b3","block_type":"box","text":"Each Fund reserves the right to limit the number of times an investor may exercise the exchange","page_number":240,"box":{"x":117,"y":348,"width":723,"height":12}},{"id":"3dea394f-807b-4993-8cf5-f5c6599c9e91","block_type":"box","text":"privilege. Certain Funds may suspend the continuous offering of their shares to the general public at","page_number":240,"box":{"x":117,"y":363,"width":747,"height":12}},{"id":"de1bd684-5de8-4119-a7cb-9e3d6cb43269","block_type":"box","text":"any time and may resume such offering from time to time. The exchange privilege is available only to","page_number":240,"box":{"x":116,"y":379,"width":755,"height":12}},{"id":"c2851da8-4311-4278-9f4e-e8e2ecb6c681","block_type":"box","text":"U.S. shareholders in states where the exchange legally may be made. The exchange privilege may be","page_number":240,"box":{"x":117,"y":394,"width":764,"height":12}},{"id":"dbb099c1-95df-4e30-9f7f-f94f4daa79d5","block_type":"box","text":"applicable to other new mutual funds whose shares may be distributed by the Distributor.","page_number":240,"box":{"x":116,"y":410,"width":666,"height":12}},{"id":"775378ee-3ed0-4096-865b-b7ed2f08445b","block_type":"box","text":"Participation in Fee-Based Programs","page_number":240,"box":{"x":117,"y":439,"width":298,"height":12}},{"id":"df313818-7ff4-40df-b989-b0142c941a3c","block_type":"box","text":"If you participate in certain fee-based programs offered by BlackRock or an affiliate of BlackRock, or","page_number":240,"box":{"x":117,"y":462,"width":747,"height":12}},{"id":"8833fc8e-b53b-4f89-8993-55a1df495b71","block_type":"box","text":"selected securities dealers or other financial intermediaries that have agreements with the Distributor","page_number":240,"box":{"x":116,"y":477,"width":754,"height":12}},{"id":"0e8f2eaf-1404-455b-9e89-a5ce3bdb3d09","block_type":"box","text":"or in certain fee-based programs in which BlackRock participates, you may be able to buy Institutional","page_number":240,"box":{"x":116,"y":493,"width":761,"height":12}},{"id":"d5893c8d-bd3b-4cd9-b993-6d1576c42ec0","block_type":"box","text":"Shares, including by exchanges from other share classes. Sales charges on the shares being","page_number":240,"box":{"x":116,"y":508,"width":700,"height":12}},{"id":"565cad8f-c7b5-477d-9efa-c7da8b720ba0","block_type":"box","text":"exchanged may be reduced or waived under certain circumstances. You generally cannot transfer","page_number":240,"box":{"x":116,"y":524,"width":733,"height":12}},{"id":"b51a0bd5-4a48-461f-939e-103862bd14b2","block_type":"box","text":"shares held through a fee-based program into another account. Instead, if you choose to leave the","page_number":240,"box":{"x":116,"y":539,"width":736,"height":12}},{"id":"69dd7cd7-7c7a-4b7c-96fc-5dd062140bd3","block_type":"box","text":"fee-based program, you may have to redeem your shares held through the program and purchase","page_number":240,"box":{"x":116,"y":555,"width":735,"height":12}},{"id":"fe0ccfa9-7d62-43ee-af94-a4adc9f2d896","block_type":"box","text":"shares of another class, which may be subject to distribution and service fees. This may be a taxable","page_number":240,"box":{"x":116,"y":570,"width":755,"height":12}},{"id":"fdb41201-c624-4dfe-b4ff-a094b1a2d2ee","block_type":"box","text":"event and you may pay any applicable sales charges or redemption fee. Please speak to your financial","page_number":240,"box":{"x":116,"y":586,"width":769,"height":12}},{"id":"d08165ff-8996-455a-8ff1-ce2f201e0f9a","block_type":"box","text":"intermediary for information about specific policies and procedures applicable to your account.","page_number":240,"box":{"x":117,"y":601,"width":703,"height":13}},{"id":"de0b3485-31df-40f3-8c85-197afbf44431","block_type":"box","text":"Generally, upon termination of a fee-based program, the shares may be liquidated or the shares can","page_number":240,"box":{"x":117,"y":631,"width":749,"height":12}},{"id":"5359b69a-c883-431f-93a4-1741837e3dc3","block_type":"box","text":"be held in an account. In certain circumstances, when a shareholder chooses to continue to hold the","page_number":240,"box":{"x":117,"y":647,"width":749,"height":11}},{"id":"e9cc00a6-c7af-483c-a4c1-7cdf1e135774","block_type":"box","text":"shares, whatever share class was held in the program can be held after termination. Shares that have","page_number":240,"box":{"x":116,"y":662,"width":756,"height":12}},{"id":"bd6e38ce-3d44-494b-b71b-c23d6957dba8","block_type":"box","text":"been held for less than specified periods within the program may be subject to a fee upon redemption.","page_number":240,"box":{"x":117,"y":677,"width":756,"height":13}},{"id":"5749b7cb-4dfe-4796-8154-942d1e950ae3","block_type":"box","text":"Shareholders that held Investor A or Institutional Shares in the program may be eligible to purchase","page_number":240,"box":{"x":116,"y":693,"width":739,"height":12}},{"id":"fb9ee54d-73a1-462a-8edb-1adb3906eed2","block_type":"box","text":"additional shares of the respective share class of a Fund, but may be subject to upfront sales charges","page_number":240,"box":{"x":116,"y":709,"width":755,"height":12}},{"id":"63b60ca9-806c-430f-a420-6531037c6e78","block_type":"box","text":"with respect to Investor A Shares. Additional purchases of Institutional Shares are permitted only if you","page_number":240,"box":{"x":116,"y":724,"width":762,"height":12}},{"id":"7462bbc8-b5b4-450e-ab5f-df570f409945","block_type":"box","text":"have an existing position at the time of purchase or are otherwise eligible to purchase Institutional","page_number":240,"box":{"x":117,"y":740,"width":723,"height":12}},{"id":"91f3713f-d413-4927-9345-f580e996cce8","block_type":"box","text":"Shares. Please speak to your financial intermediary for more information.","page_number":240,"box":{"x":116,"y":755,"width":542,"height":12}},{"id":"70e8b367-7449-4904-8eaa-cade07065690","block_type":"box","text":"Certain financial intermediaries may, in connection with a change in account type (for example, due to","page_number":240,"box":{"x":117,"y":785,"width":755,"height":12}},{"id":"a70e270b-d409-4c1a-baad-08a6265975d9","block_type":"box","text":"leaving a fee-based program or upon termination of the fee-based program) or otherwise in","page_number":240,"box":{"x":117,"y":800,"width":675,"height":12}},{"id":"94e39594-3523-41f6-a86e-68b9f8b69530","block_type":"box","text":"accordance with the financial intermediary’s policies and procedures, exchange the share class held in","page_number":240,"box":{"x":116,"y":816,"width":761,"height":12}},{"id":"cb4505dc-ce12-4b7d-9eed-05682d993e2f","block_type":"box","text":"the program for another share class of the same fund, provided that the exchanged shares are not","page_number":240,"box":{"x":116,"y":831,"width":736,"height":12}},{"id":"eafb3a7f-972f-4339-84d1-49ea98620e34","block_type":"box","text":"subject to a sales charge and the shareholder meets the eligibility requirements of the new share class.","page_number":240,"box":{"x":116,"y":847,"width":772,"height":12}},{"id":"6d9414d6-25ca-46df-a9f7-fff3f0940c39","block_type":"box","text":"Please speak to your financial intermediary for information about specific policies and procedures","page_number":240,"box":{"x":117,"y":862,"width":726,"height":12}},{"id":"b1eb1dc2-d870-4024-a69c-a811720e8c32","block_type":"box","text":"applicable to your account.","page_number":240,"box":{"x":116,"y":878,"width":205,"height":12}},{"id":"9c4f745e-d66a-44cc-a21b-11ca3bb0f88d","block_type":"box","text":"II-153","page_number":240,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"d0f6cf1f-23ee-456f-b609-3cc737519d6f","block_type":"box","text":"NM1026U-6004382-240/605","page_number":240,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"64811908-1a08-45ab-a436-8219c594989c","block_type":"box","text":"Details about the features of each fee-based program and the relevant charges, terms and conditions","page_number":241,"box":{"x":117,"y":87,"width":757,"height":12}},{"id":"99c19e52-4eeb-456f-bfb3-1da641fd0047","block_type":"box","text":"are included in the client agreement for each fee-based program and are available from your financial","page_number":241,"box":{"x":116,"y":102,"width":759,"height":13}},{"id":"24e474e7-7d3d-4c18-8259-3d589ca115ab","block_type":"box","text":"professional, selected securities dealer or other financial intermediary. Please speak to your financial","page_number":241,"box":{"x":117,"y":118,"width":753,"height":12}},{"id":"f80bbb11-03d3-4583-b1f1-9b08f0c19464","block_type":"box","text":"intermediary for more information.","page_number":241,"box":{"x":117,"y":134,"width":256,"height":12}},{"id":"0829168f-8d72-40b4-9d00-7d4211fc8f2e","block_type":"box","text":"Retirement and Education Savings Plans","page_number":241,"box":{"x":117,"y":165,"width":331,"height":12}},{"id":"3ddc4489-7f98-4828-95ea-b6d189377a43","block_type":"box","text":"Individual retirement accounts and other retirement and education savings plans are available from","page_number":241,"box":{"x":117,"y":188,"width":739,"height":12}},{"id":"bdb532c8-bfa2-4e6e-92ce-a44b603eb8c6","block_type":"box","text":"your financial intermediary. Under these plans, investments may be made in a Fund (other than a","page_number":241,"box":{"x":116,"y":203,"width":728,"height":12}},{"id":"ee4a26ff-a724-44d1-bbb7-4b4139c0f491","block_type":"box","text":"Municipal Fund) and certain of the other mutual funds sponsored by the Manager or its affiliates as well","page_number":241,"box":{"x":117,"y":219,"width":771,"height":12}},{"id":"a1588faa-8cc9-4dce-9bbe-1ddc900332be","block_type":"box","text":"as in other securities. There may be fees associated with investing through these plans. Information","page_number":241,"box":{"x":116,"y":234,"width":745,"height":12}},{"id":"02ab76e0-d588-48b6-a882-f678212c0245","block_type":"box","text":"with respect to these plans is available on request from your financial intermediary.","page_number":241,"box":{"x":116,"y":250,"width":620,"height":12}},{"id":"1830a6cd-8b28-4bf1-9295-c289b66b7899","block_type":"box","text":"Dividends received in each of the plans referred to above are exempt from U.S. federal taxation until","page_number":241,"box":{"x":117,"y":281,"width":749,"height":12}},{"id":"d085de51-cc5a-487e-9b1c-98bd93bac2b3","block_type":"box","text":"distributed from the plans and, in the case of Roth IRAs and education savings plans, may be exempt","page_number":241,"box":{"x":116,"y":296,"width":759,"height":12}},{"id":"a61cc182-aad5-435f-9339-7b05eee16a8e","block_type":"box","text":"from taxation when distributed as well. Investors considering participation in any retirement or","page_number":241,"box":{"x":116,"y":312,"width":699,"height":12}},{"id":"17635932-7db7-453e-a9c3-23c9cad1a80b","block_type":"box","text":"education savings plan should review specific tax laws relating to the plan and should consult their","page_number":241,"box":{"x":116,"y":327,"width":735,"height":12}},{"id":"4f1caf1a-31d4-49c0-9cec-1ee84d6f163a","block_type":"box","text":"attorneys or tax advisors with respect to the establishment and maintenance of any such plan.","page_number":241,"box":{"x":116,"y":343,"width":704,"height":12}},{"id":"06d7991d-46a1-4439-bc5f-9474c04e7404","block_type":"box","text":"Automatic Investment Plans","page_number":241,"box":{"x":116,"y":374,"width":230,"height":9}},{"id":"4380e53d-c7b6-4447-8822-420d0028759d","block_type":"box","text":"Investor class shareholders and certain Service Share shareholders who were shareholders of the","page_number":241,"box":{"x":117,"y":397,"width":734,"height":10}},{"id":"af1dd474-cc74-4b6a-9224-6de4dbdff9be","block_type":"box","text":"Compass Capital Group of Funds at the time of its combination with The PNC","page_number":241,"box":{"x":117,"y":413,"width":575,"height":12}},{"id":"4cd85b0c-7741-44a4-9093-db392e72a3ac","block_type":"box","text":"®","page_number":241,"box":{"x":693,"y":412,"width":9,"height":7}},{"id":"67044333-2e7f-48aa-88d0-32177977b3c0","block_type":"box","text":"Fund in 1996 may","page_number":241,"box":{"x":702,"y":413,"width":144,"height":12}},{"id":"986de90e-ed13-4add-9212-031456456efb","block_type":"box","text":"arrange for periodic investments in that Fund through automatic deductions from a checking or savings","page_number":241,"box":{"x":116,"y":428,"width":769,"height":12}},{"id":"babc4d8d-ca26-4768-85d1-3eb6a31c29ac","block_type":"box","text":"account. The minimum pre-authorized investment amount is $50. If you buy shares of a Fund through","page_number":241,"box":{"x":116,"y":443,"width":760,"height":13}},{"id":"eae05393-3c1e-4aee-8d1f-4e6c46bdee97","block_type":"box","text":"certain accounts, no minimum charge to your bank account is required. Contact your financial adviser","page_number":241,"box":{"x":116,"y":459,"width":759,"height":12}},{"id":"b32df27b-ea4e-448c-a59e-eae13b8c1446","block_type":"box","text":"or other financial intermediary for more information.","page_number":241,"box":{"x":116,"y":475,"width":386,"height":12}},{"id":"552cb672-06e3-4487-83f7-6313af55aad6","block_type":"box","text":"Automatic Dividend Reinvestment Plan","page_number":241,"box":{"x":116,"y":506,"width":318,"height":9}},{"id":"2bc5f04d-3b10-48ae-8f9c-55040fe70792","block_type":"box","text":"Each Fund will distribute substantially all of its net investment income and net realized capital gains, if","page_number":241,"box":{"x":117,"y":529,"width":758,"height":12}},{"id":"f3d77f7c-cd68-4f2a-857c-7db8b2f57df1","block_type":"box","text":"any, to shareholders. All distributions are automatically reinvested at NAV in the form of additional full","page_number":241,"box":{"x":116,"y":544,"width":758,"height":12}},{"id":"5621bf2e-6dda-4921-a16e-9a96a4a96d50","block_type":"box","text":"and fractional shares of the same class of shares of the relevant Fund unless a shareholder elects","page_number":241,"box":{"x":116,"y":560,"width":734,"height":9}},{"id":"4b663e1c-2b7b-4032-8b97-16eea319ba37","block_type":"box","text":"otherwise or as otherwise set forth in a Fund’s prospectus. Such election, or any revocation thereof,","page_number":241,"box":{"x":116,"y":575,"width":746,"height":12}},{"id":"0b867a86-022d-4a3f-9a87-b4b78f98373d","block_type":"box","text":"must be made in writing to the Transfer Agent, and will become effective with respect to dividends paid","page_number":241,"box":{"x":117,"y":591,"width":767,"height":12}},{"id":"0ddeed4d-0337-43d1-8882-45602fe5ef71","block_type":"box","text":"after its receipt by the Transfer Agent.","page_number":241,"box":{"x":116,"y":606,"width":286,"height":12}},{"id":"c419fa22-bc0a-400b-bdd7-c23ff8e458c5","block_type":"box","text":"Systematic Withdrawal Plans","page_number":241,"box":{"x":116,"y":637,"width":237,"height":12}},{"id":"9fe3befa-9a6d-455d-9b68-fc489dbe6baa","block_type":"box","text":"Shareholders may receive regular distributions from their accounts via a Systematic Withdrawal Plan","page_number":241,"box":{"x":116,"y":661,"width":747,"height":12}},{"id":"52d61af2-99ed-4d16-abc9-33f1d6703752","block_type":"box","text":"(“SWP”). Upon commencement of the SWP, the account must have a current value of $10,000 or more","page_number":241,"box":{"x":117,"y":675,"width":765,"height":13}},{"id":"8fcd3024-c9f7-4df0-8e8e-356875f7e665","block_type":"box","text":"in a Fund. Shareholders may elect to receive automatic cash payments of $50 or more at any interval.","page_number":241,"box":{"x":117,"y":691,"width":755,"height":13}},{"id":"0a0a6028-b51d-48db-862a-e6205eb71849","block_type":"box","text":"You may choose any day for the withdrawal. If no day is specified, the withdrawals will be processed","page_number":241,"box":{"x":116,"y":707,"width":745,"height":12}},{"id":"52d4e057-0597-4f12-8700-59dca9173b92","block_type":"box","text":"on the 25th day of the month or, if such day is not a business day, on the prior business day and are","page_number":241,"box":{"x":116,"y":723,"width":744,"height":12}},{"id":"50e1f449-6fe3-40ab-82d6-f661d01ad675","block_type":"box","text":"paid promptly thereafter. An investor may utilize the SWP by completing the Systematic Withdrawal","page_number":241,"box":{"x":117,"y":738,"width":736,"height":12}},{"id":"62ac626f-d07c-44b4-ac21-ff0141d9d796","block_type":"box","text":"Plan Application Form which may be obtained by visiting our website at www.blackrock.com.","page_number":241,"box":{"x":117,"y":754,"width":685,"height":12}},{"id":"2b4975ff-608c-4d50-948c-88c6bfff323c","block_type":"box","text":"Shareholders should realize that if withdrawals exceed income dividends their invested principal in the","page_number":241,"box":{"x":116,"y":785,"width":757,"height":12}},{"id":"72f19498-e526-4611-bfa9-d5d871435013","block_type":"box","text":"account will be depleted. To participate in the SWP, shareholders must have their dividends","page_number":241,"box":{"x":116,"y":800,"width":681,"height":12}},{"id":"628c4e77-a81f-493a-af95-8c1f9c6562c9","block_type":"box","text":"automatically reinvested. Shareholders may change or cancel the SWP at any time, upon written","page_number":241,"box":{"x":116,"y":816,"width":717,"height":12}},{"id":"553f68d3-1219-4357-b70e-0b319c537def","block_type":"box","text":"notice to the Fund, or by calling the Fund at (800) 441-7762. Purchases of additional Investor A or","page_number":241,"box":{"x":117,"y":831,"width":731,"height":12}},{"id":"2aede856-2cae-4ed4-864e-8ba0aa999d9d","block_type":"box","text":"Investor P Shares of the Fund concurrently with withdrawals may be disadvantageous to investors","page_number":241,"box":{"x":117,"y":847,"width":733,"height":12}},{"id":"30cedb9b-4811-4f03-8d1a-d1c037438c3b","block_type":"box","text":"because of the sales charges involved and, therefore, are discouraged. No CDSC will be assessed on","page_number":241,"box":{"x":117,"y":862,"width":762,"height":12}},{"id":"a55c2aa2-5e96-4a07-aa31-faaf56172492","block_type":"box","text":"redemptions of Investor C Shares made through the SWP that do not exceed 12% of the original","page_number":241,"box":{"x":117,"y":878,"width":721,"height":12}},{"id":"201b80d4-3fd8-4f67-abb6-924c021b0658","block_type":"box","text":"II-154","page_number":241,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"5fc57486-c32d-46f9-be57-e622a0a0e706","block_type":"box","text":"NM1026U-6004382-241/605","page_number":241,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"61d1b6bc-501b-4bd9-a87c-a936ffd7de2c","block_type":"box","text":"investment on an annualized basis. For example, monthly, quarterly and semi-annual SWP","page_number":242,"box":{"x":117,"y":87,"width":680,"height":12}},{"id":"f1a0af61-5748-4371-8f7d-016b5e2a566c","block_type":"box","text":"redemptions of Investor C Shares will not be subject to the CDSC if they do not exceed 1% (monthly),","page_number":242,"box":{"x":117,"y":102,"width":759,"height":13}},{"id":"a08459c0-a1d7-461f-a1f9-cd9dbade6d4a","block_type":"box","text":"3% (quarterly) and 6% (semi-annually), respectively, of an account’s NAV on the redemption date.","page_number":242,"box":{"x":116,"y":118,"width":734,"height":12}},{"id":"a1489e25-d470-4f59-b9a9-3df43f50f5ae","block_type":"box","text":"SWP redemptions of Investor C Shares in excess of this limit are still subject to the applicable CDSC.","page_number":242,"box":{"x":116,"y":134,"width":758,"height":12}},{"id":"7743c842-39ee-4094-9404-ce256362dae8","block_type":"box","text":"For this reason, a shareholder may not participate in the Automatic Investment Plan described above","page_number":242,"box":{"x":117,"y":164,"width":754,"height":12}},{"id":"6e5ffba8-5b89-45e0-9449-f3aacd8e1b41","block_type":"box","text":"(see “How to Buy, Sell, Exchange and Transfer Shares” or “How to Buy, Sell and Exchange Shares,”","page_number":242,"box":{"x":117,"y":180,"width":752,"height":12}},{"id":"a72812fa-914a-4c95-8294-17ff33b635d3","block_type":"box","text":"as applicable, in the Fund’s Prospectus) and the SWP at the same time.","page_number":242,"box":{"x":116,"y":195,"width":540,"height":12}},{"id":"4eeb89c4-c94c-4447-847c-a98012e9b089","block_type":"box","text":"Dividend Allocation Plan","page_number":242,"box":{"x":117,"y":226,"width":201,"height":9}},{"id":"d384f585-504f-444e-84fa-8bf2bb41c5e1","block_type":"box","text":"The Dividend Allocation Plan, as applicable, allows shareholders to elect to have all their dividends and","page_number":242,"box":{"x":116,"y":252,"width":771,"height":11}},{"id":"ba1bb374-72e1-4659-8b76-71b23a1bfde3","block_type":"box","text":"any other distributions from any Eligible Fund (which means funds so designated by the Distributor","page_number":242,"box":{"x":116,"y":267,"width":737,"height":12}},{"id":"3aecf8eb-40e2-4ca2-a71e-f8399cd05c68","block_type":"box","text":"from time to time) automatically invested at NAV in one other such Eligible Fund designated by the","page_number":242,"box":{"x":116,"y":282,"width":737,"height":13}},{"id":"618a9268-e449-4644-8afd-953d3ad89bc3","block_type":"box","text":"shareholder, provided the account into which the dividends and distributions are directed is initially","page_number":242,"box":{"x":116,"y":298,"width":735,"height":12}},{"id":"9012fe7b-996e-4d89-a700-b328721fb137","block_type":"box","text":"funded with the requisite minimum amount.","page_number":242,"box":{"x":116,"y":313,"width":325,"height":12}},{"id":"4cd54a71-b35b-41d6-94cc-57f665d34dd6","block_type":"box","text":"P","page_number":242,"box":{"x":428,"y":359,"width":9,"height":10}},{"id":"ec085aa0-3d63-4212-b155-bd604380ec8f","block_type":"box","text":"RICING","page_number":242,"box":{"x":439,"y":362,"width":45,"height":7}},{"id":"99050d18-bc37-48a2-9644-98a6112538e9","block_type":"box","text":"OF","page_number":242,"box":{"x":491,"y":362,"width":17,"height":7}},{"id":"5a46d7a0-4e52-40f7-8cc4-2ab0fadb4127","block_type":"box","text":"S","page_number":242,"box":{"x":509,"y":359,"width":15,"height":10}},{"id":"a16da1f5-c3cb-4f61-9af4-c993c6427e75","block_type":"box","text":"HARES","page_number":242,"box":{"x":526,"y":362,"width":46,"height":7}},{"id":"535543e3-6dcc-47af-a9dc-a4af2746b951","block_type":"box","text":"Determination of Net Asset Value","page_number":242,"box":{"x":117,"y":390,"width":269,"height":10}},{"id":"29a89b5a-ea11-41fa-bbf0-975c2f2ba09b","block_type":"box","text":"Valuation of Shares.","page_number":242,"box":{"x":116,"y":413,"width":160,"height":10}},{"id":"70d0e279-0da5-474f-beda-cc7ed90d70e5","block_type":"box","text":"The NAV for each class of shares of each Fund is generally calculated as of the","page_number":242,"box":{"x":278,"y":413,"width":602,"height":12}},{"id":"97b68214-132c-463f-bf58-dfc7ee043423","block_type":"box","text":"close of regular trading hours on the NYSE (currently 4:00 p.m. Eastern Time) on each business day","page_number":242,"box":{"x":116,"y":429,"width":752,"height":12}},{"id":"af66464f-3528-49a7-820e-44d2c141ddfe","block_type":"box","text":"the NYSE is open. Valuation of assets held by a Fund is as follows:","page_number":242,"box":{"x":116,"y":444,"width":505,"height":12}},{"id":"9f62a78c-63a9-4bc7-9e29-6c26a07de0b1","block_type":"box","text":"Equity Investments.","page_number":242,"box":{"x":117,"y":475,"width":157,"height":12}},{"id":"1fd81434-1b99-45d1-8a89-d8090a8dc77e","block_type":"box","text":"Equity securities traded on a recognized securities exchange (e.g., NYSE), on","page_number":242,"box":{"x":275,"y":475,"width":589,"height":12}},{"id":"65b2176e-5cb2-4c8e-92c4-668ab8fabbf5","block_type":"box","text":"separate trading boards of a securities exchange or through a market system that provides","page_number":242,"box":{"x":116,"y":490,"width":679,"height":12}},{"id":"8788f2cc-1ede-4465-b4b2-d24382b35db4","block_type":"box","text":"contemporaneous transaction pricing information (each, an “Exchange”) are valued using information","page_number":242,"box":{"x":116,"y":506,"width":756,"height":12}},{"id":"f18eb694-f749-4c27-9a10-bcde8aff08f6","block_type":"box","text":"obtained via independent pricing services, generally at the Exchange closing price or if an Exchange","page_number":242,"box":{"x":116,"y":521,"width":751,"height":12}},{"id":"cb46d790-2ad2-48e8-b26d-ac49448d7bcb","block_type":"box","text":"closing price is not available, the last traded price on that Exchange prior to the time as of which the","page_number":242,"box":{"x":116,"y":537,"width":745,"height":12}},{"id":"da5b94bb-48da-465c-8091-f6fcebe60045","block_type":"box","text":"assets or liabilities are valued. However, under certain circumstances, other means of determining","page_number":242,"box":{"x":116,"y":552,"width":734,"height":12}},{"id":"6e22c250-c657-43bc-93d0-88e2fa9aae9d","block_type":"box","text":"current market value may be used. If an equity security is traded on more than one Exchange, the","page_number":242,"box":{"x":116,"y":568,"width":732,"height":12}},{"id":"2d9098b7-64c8-4d15-9896-86095c68898e","block_type":"box","text":"current market value of the security where it is primarily traded generally will be used. In the event that","page_number":242,"box":{"x":116,"y":583,"width":764,"height":12}},{"id":"54b161fe-40e0-4301-9222-67df6f5e26bc","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","page_number":242,"box":{"x":116,"y":599,"width":766,"height":12}},{"id":"10afcb7f-5fa6-4dfc-ae4e-140cb3bebdb1","block_type":"box","text":"security, the last bid (long positions) or ask (short positions) price, if available, will be used as the value","page_number":242,"box":{"x":116,"y":614,"width":770,"height":12}},{"id":"5b74f340-c327-451c-961b-a89ed76cf0ec","block_type":"box","text":"of such security. If a Fund holds both long and short positions in the same security, the last bid price","page_number":242,"box":{"x":116,"y":630,"width":748,"height":12}},{"id":"9569b87f-74f6-4b42-8cf9-c8a39626f468","block_type":"box","text":"will be applied to securities held long and the last ask price will be applied to securities sold short. If no","page_number":242,"box":{"x":116,"y":645,"width":766,"height":12}},{"id":"9b6a360b-4d8c-4376-816d-5c1559b18dba","block_type":"box","text":"bid or ask price is available on a day on which a Fund values such security, the prior day’s price will be","page_number":242,"box":{"x":117,"y":661,"width":761,"height":12}},{"id":"f7248bcc-9cd7-4509-8832-f38f621a50f3","block_type":"box","text":"used, unless BlackRock determines that such prior day’s price no longer reflects the fair value of the","page_number":242,"box":{"x":117,"y":676,"width":743,"height":12}},{"id":"5a2775d5-d78a-4e5b-8daf-dadbf42845f0","block_type":"box","text":"security, in which case such asset would be treated as a Fair Value Asset (as defined below).","page_number":242,"box":{"x":116,"y":692,"width":692,"height":12}},{"id":"171eebb5-c9a3-4e4c-9c7e-ccd128d10ed2","block_type":"box","text":"Fixed-Income Investments.","page_number":242,"box":{"x":117,"y":723,"width":214,"height":9}},{"id":"5c83ab33-965c-42b2-8914-e85fc96b5ffd","block_type":"box","text":"Fixed-income securities are generally valued using bid prices provided by","page_number":242,"box":{"x":338,"y":723,"width":544,"height":12}},{"id":"aee1ec87-3576-414d-90fc-203982f95d04","block_type":"box","text":"dealers or prices (including evaluated prices) supplied by the Fund’s approved independent third-party","page_number":242,"box":{"x":116,"y":738,"width":759,"height":12}},{"id":"50fcc6dc-2789-4751-986f-1a64686ff780","block_type":"box","text":"pricing services, each in accordance with the Valuation Procedures. The pricing services may use","page_number":242,"box":{"x":117,"y":754,"width":725,"height":12}},{"id":"1a0f3e1d-f363-4d36-a35c-68cd12c0b917","block_type":"box","text":"valuation models that utilize certain inputs and assumptions to derive values, including transaction data","page_number":242,"box":{"x":116,"y":769,"width":765,"height":12}},{"id":"cd3c2ca5-69e0-40b1-96aa-b1977cfcd29a","block_type":"box","text":"(e.g., recent representative bids and offers), credit quality information, perceived market movements,","page_number":242,"box":{"x":117,"y":785,"width":746,"height":12}},{"id":"be1dcb36-c465-45ee-b934-cff7e1890a61","block_type":"box","text":"news, and other relevant information and by other methods, which may include consideration of: yields","page_number":242,"box":{"x":117,"y":800,"width":761,"height":12}},{"id":"a9c53154-74fa-46b9-a4e5-761e1b1289a0","block_type":"box","text":"or prices of securities of comparable quality, coupon, maturity and type; indications as to values from","page_number":242,"box":{"x":116,"y":816,"width":747,"height":12}},{"id":"060954c2-8c2c-4519-80c9-b241b399e7da","block_type":"box","text":"dealers; general market conditions; and/or other factors and assumptions. Pricing services generally","page_number":242,"box":{"x":116,"y":831,"width":749,"height":12}},{"id":"c14faf98-4cde-4719-99e0-fa7f11ea3996","block_type":"box","text":"value fixed-income securities assuming orderly transactions of an institutional round lot size, but the","page_number":242,"box":{"x":116,"y":847,"width":745,"height":12}},{"id":"6cedcec7-b219-403e-a051-ac907c3603f4","block_type":"box","text":"Fund may hold or transact in such securities in smaller, odd lot sizes. Odd lots of securities in certain","page_number":242,"box":{"x":117,"y":862,"width":752,"height":12}},{"id":"8a56ece0-e8e8-4eca-bdb0-f513f08effdc","block_type":"box","text":"asset classes may trade at lower prices than institutional round lots, and the value ultimately realized","page_number":242,"box":{"x":116,"y":878,"width":753,"height":12}},{"id":"b189a59c-3911-4c42-b0a3-0b5e2ebafc1d","block_type":"box","text":"II-155","page_number":242,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"7b7218ac-e404-48a9-a867-599b69aae590","block_type":"box","text":"NM1026U-6004382-242/605","page_number":242,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"afed5254-5eec-4a36-981f-0b427cfb7586","block_type":"box","text":"when the securities are sold could differ from the prices used by a Fund. The amortized cost method of","page_number":243,"box":{"x":116,"y":87,"width":769,"height":12}},{"id":"2c0cd3a5-0aed-4844-906f-1f7e5257a726","block_type":"box","text":"valuation may be used with respect to debt obligations with 60 days or less remaining to maturity","page_number":243,"box":{"x":116,"y":103,"width":723,"height":12}},{"id":"b3437fb0-6408-428b-b9b8-94adcf618e93","block_type":"box","text":"unless such method does not represent fair value. Certain fixed-income investments, including asset","page_number":243,"box":{"x":117,"y":118,"width":750,"height":12}},{"id":"07bc822f-a4ad-4443-93a4-fd538a6fa8c4","block_type":"box","text":"backed and mortgage related securities, may be valued based on valuation models that consider the","page_number":243,"box":{"x":117,"y":134,"width":751,"height":12}},{"id":"0695e44b-aa5d-4656-be10-3da99df32b60","block_type":"box","text":"estimated cash flows of each tranche of the issuer, establish a benchmark yield and develop an","page_number":243,"box":{"x":116,"y":149,"width":715,"height":12}},{"id":"86fd1bb4-10ed-4e12-bcf8-b9ef1b8287df","block_type":"box","text":"estimated tranche specific spread to the benchmark yield based on the unique attributes of the","page_number":243,"box":{"x":116,"y":165,"width":707,"height":12}},{"id":"5f62de80-e727-4bc2-9dfa-0323d6a1159f","block_type":"box","text":"tranche.","page_number":243,"box":{"x":116,"y":180,"width":65,"height":10}},{"id":"7f049e59-458e-410a-ae2c-40f682293ede","block_type":"box","text":"Options, Futures, Swaps and Other Derivatives.","page_number":243,"box":{"x":116,"y":211,"width":379,"height":12}},{"id":"fcac96ff-e24c-4ce9-abb1-8f91e24b403e","block_type":"box","text":"Exchange-traded equity options (except ETF","page_number":243,"box":{"x":497,"y":211,"width":342,"height":12}},{"id":"60728a6c-4296-483f-8db0-6c1b124ca6e9","block_type":"box","text":"options, equity index options or those that are customized) for which market quotations are readily","page_number":243,"box":{"x":116,"y":227,"width":733,"height":12}},{"id":"93f1bc78-f5ba-4073-b907-4a7020de41f7","block_type":"box","text":"available are valued at the mean of the last bid and ask prices as quoted on the Exchange or the board","page_number":243,"box":{"x":116,"y":242,"width":771,"height":12}},{"id":"34d37eb6-f516-4b30-9c16-81ed4076c9c9","block_type":"box","text":"of trade on which such options are traded. In the event that there is no mean price available for an","page_number":243,"box":{"x":116,"y":258,"width":734,"height":11}},{"id":"c27a9146-b831-4a24-83d9-59965c509a02","block_type":"box","text":"exchange-traded equity option held by a Fund on a day on which the Fund values such option, the last","page_number":243,"box":{"x":116,"y":273,"width":766,"height":12}},{"id":"e465456c-e9a1-4162-9c44-fd46b31f1740","block_type":"box","text":"bid (long positions) or ask (short positions) price, if available, will be used as the value of such option. If","page_number":243,"box":{"x":117,"y":289,"width":771,"height":12}},{"id":"5fd920f3-2889-4f03-b2d7-f70fcc0500b7","block_type":"box","text":"no bid or ask price is available on a day on which a Fund values such option, the prior day’s price will","page_number":243,"box":{"x":117,"y":304,"width":755,"height":12}},{"id":"24f2e78f-bcd7-439a-87ac-755c2da37942","block_type":"box","text":"be used, unless BlackRock determines that such prior day’s price no longer reflects the fair value of","page_number":243,"box":{"x":117,"y":320,"width":743,"height":12}},{"id":"27b138b5-1788-4625-b2fc-a74ce307aa9f","block_type":"box","text":"the option, in which case such option will be treated as a Fair Value Asset. Customized exchange","page_number":243,"box":{"x":116,"y":335,"width":729,"height":12}},{"id":"3eaef1e2-3b31-4f62-af5a-4ff9ddfe42cd","block_type":"box","text":"traded equity options, ETF options, equity index options and OTC derivatives, may be valued using a","page_number":243,"box":{"x":116,"y":351,"width":755,"height":12}},{"id":"9e5ffe2d-237c-47b0-8a78-90a7d2d7090b","block_type":"box","text":"mathematical model which may incorporate a number of market data factors. Financial futures","page_number":243,"box":{"x":117,"y":366,"width":703,"height":12}},{"id":"6d2cb0d3-8328-49e2-b575-6d34efc23377","block_type":"box","text":"contracts and options thereon, which are traded on exchanges, are valued at their last sale price or","page_number":243,"box":{"x":116,"y":382,"width":741,"height":12}},{"id":"cc2c7568-fd34-4388-b9dc-a9980ecf1f5c","block_type":"box","text":"settle price as of the close of such exchanges. Swap agreements and other derivatives are generally","page_number":243,"box":{"x":116,"y":397,"width":752,"height":12}},{"id":"8832dd61-d0fc-4baa-bb1b-c008c71be766","block_type":"box","text":"valued daily based upon quotations from market makers or by a pricing service in accordance with the","page_number":243,"box":{"x":116,"y":413,"width":763,"height":12}},{"id":"80af8388-afa5-4054-a0b8-4bd8811bc739","block_type":"box","text":"Valuation Procedures.","page_number":243,"box":{"x":116,"y":428,"width":170,"height":10}},{"id":"093f86ff-7cf0-44bb-b1f6-51e0c72baca8","block_type":"box","text":"Underlying Funds.","page_number":243,"box":{"x":117,"y":459,"width":145,"height":12}},{"id":"6c87d6aa-a6c5-4a11-b2eb-a05ed2b1594e","block_type":"box","text":"Shares of underlying open-end funds (including money market funds) are valued","page_number":243,"box":{"x":263,"y":459,"width":609,"height":12}},{"id":"2ef3fb77-4db9-4256-9e6d-d1b0697c222e","block_type":"box","text":"at NAV. Shares of underlying exchange-traded closed-end funds or other ETFs will be valued at their","page_number":243,"box":{"x":116,"y":475,"width":755,"height":12}},{"id":"0a34facb-f79f-4257-b905-38de09d844f1","block_type":"box","text":"most recent closing price.","page_number":243,"box":{"x":117,"y":490,"width":194,"height":12}},{"id":"07159616-8f4b-43e7-b618-1967aa4ecf78","block_type":"box","text":"General Valuation Information.","page_number":243,"box":{"x":116,"y":521,"width":244,"height":10}},{"id":"726ce30f-3100-4177-af3c-1e372573fd0e","block_type":"box","text":"Prices obtained from independent third-party pricing services, broker","page_number":243,"box":{"x":361,"y":521,"width":520,"height":12}},{"id":"30117e9e-faaf-4ca6-9505-e9981832d75b","block_type":"box","text":"dealers or market makers to value each Fund’s securities and other assets and liabilities are based on","page_number":243,"box":{"x":116,"y":537,"width":764,"height":9}},{"id":"d5cdb5da-977e-4056-8164-6596d6614902","block_type":"box","text":"information available at the time the Fund values its assets and liabilities. In the event that a pricing","page_number":243,"box":{"x":117,"y":552,"width":740,"height":12}},{"id":"a2e63e52-03d4-4965-99e2-56fe4676533f","block_type":"box","text":"service quotation is revised or updated subsequent to the day on which the Fund valued such security,","page_number":243,"box":{"x":116,"y":568,"width":767,"height":12}},{"id":"57bfe850-527f-4bcb-a432-3ea61b7daf04","block_type":"box","text":"the revised pricing service quotation generally will be applied prospectively. Such determination will be","page_number":243,"box":{"x":116,"y":583,"width":764,"height":12}},{"id":"95edcabd-d48b-42ea-b253-372d4042f3c5","block_type":"box","text":"made considering pertinent facts and circumstances surrounding the revision.","page_number":243,"box":{"x":117,"y":599,"width":581,"height":12}},{"id":"3cba4b93-261d-4bc6-8b86-155960917a30","block_type":"box","text":"In determining the market value of portfolio investments, the Fund may employ independent third","page_number":243,"box":{"x":117,"y":622,"width":723,"height":12}},{"id":"ea315b8f-710c-4710-b101-5cc3b05fad68","block_type":"box","text":"party pricing services, which may use, without limitation, evaluated pricing methods that take into","page_number":243,"box":{"x":117,"y":638,"width":723,"height":11}},{"id":"b9466ef1-fcbc-4ab6-8093-3edbcb87279e","block_type":"box","text":"consideration market indexes, matrices, yield curves and other specified inputs and assumptions. This","page_number":243,"box":{"x":116,"y":653,"width":764,"height":12}},{"id":"17e2bb3b-0247-4f06-9fb6-fe8b0457e3de","block_type":"box","text":"may result in the assets being valued at a price different from the price that would have been","page_number":243,"box":{"x":117,"y":668,"width":687,"height":12}},{"id":"2d0c5a21-e0b2-43ef-8fb0-7ecd10cd4f53","block_type":"box","text":"determined had the evaluated pricing method not been used. The price the Fund could receive upon","page_number":243,"box":{"x":116,"y":684,"width":744,"height":12}},{"id":"12d18c89-7adb-41c8-9e36-86f19cf9fe85","block_type":"box","text":"the sale of any particular portfolio investment may differ from the Fund’s valuation of the investment,","page_number":243,"box":{"x":116,"y":699,"width":742,"height":13}},{"id":"fd9244cc-f810-45de-abea-6fa31c008036","block_type":"box","text":"particularly for assets that trade in thin or volatile markets or that are valued using a fair valuation","page_number":243,"box":{"x":117,"y":715,"width":718,"height":12}},{"id":"8a03d9a2-0541-41e5-9ab7-afba0cc088d0","block_type":"box","text":"methodology or a price provided by an independent pricing service. As a result, the price received","page_number":243,"box":{"x":117,"y":731,"width":724,"height":12}},{"id":"5eed90a5-3e00-4561-b1cb-55ce211652a2","block_type":"box","text":"upon the sale of an investment may be less than the value ascribed by the Fund, and the Fund could","page_number":243,"box":{"x":117,"y":746,"width":747,"height":12}},{"id":"9354cccb-8059-4848-80f6-91292eb30284","block_type":"box","text":"realize a greater than expected loss or lesser than expected gain upon the sale of the investment. The","page_number":243,"box":{"x":117,"y":761,"width":758,"height":13}},{"id":"68e9dbe5-4444-407e-a572-2d648398b859","block_type":"box","text":"Fund’s ability to value its investment may also be impacted by technological issues and/or errors by","page_number":243,"box":{"x":117,"y":777,"width":738,"height":12}},{"id":"0e28081a-8e1b-4fa1-937c-66676c056897","block_type":"box","text":"pricing services or other third-party service providers.","page_number":243,"box":{"x":117,"y":793,"width":393,"height":12}},{"id":"0288f20f-0cd8-489e-bc80-5833e2078b13","block_type":"box","text":"In the event that application of the methods of valuation discussed above result in a price for a security","page_number":243,"box":{"x":117,"y":823,"width":761,"height":13}},{"id":"1cd12a85-85fa-4c20-b9b4-97ec337e35de","block_type":"box","text":"which is deemed not to be representative of the fair market value of such security, the security will be","page_number":243,"box":{"x":116,"y":839,"width":756,"height":12}},{"id":"e270a553-f872-4fff-ae72-6fe59cd51378","block_type":"box","text":"valued by, under the direction of or in accordance with a method approved by BlackRock, the Fund’s","page_number":243,"box":{"x":116,"y":854,"width":752,"height":13}},{"id":"6d0e8df5-9752-43f9-a2fa-446852e2fbbd","block_type":"box","text":"valuation designee, as reflecting fair value. 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BlackRock may reasonably","page_number":244,"box":{"x":116,"y":289,"width":704,"height":12}},{"id":"77c20324-c4ea-447f-aa1c-30c5b8b50863","block_type":"box","text":"conclude that a market quotation is not readily available or is unreliable if, among other things, a","page_number":244,"box":{"x":116,"y":304,"width":718,"height":12}},{"id":"c358240b-a9bc-4ce7-997d-d99ee055e6cd","block_type":"box","text":"security or other asset or liability does not have a price source due to its complete lack of trading, if","page_number":244,"box":{"x":116,"y":320,"width":739,"height":12}},{"id":"aa2682ff-d97c-4338-8bc5-bc79d1d72dff","block_type":"box","text":"BlackRock believes a market quotation from a broker-dealer or other source is unreliable (e.g., where it","page_number":244,"box":{"x":117,"y":335,"width":770,"height":12}},{"id":"75a737ad-56aa-4db8-94f0-fd6db5d235e5","block_type":"box","text":"varies significantly from a recent trade, or no longer reflects the fair value of the security or other asset","page_number":244,"box":{"x":116,"y":351,"width":765,"height":12}},{"id":"8db0be79-35b2-4fbc-8845-3b375e37bbd2","block_type":"box","text":"or liability subsequent to the most recent market quotation), or where the security or other asset or","page_number":244,"box":{"x":116,"y":366,"width":735,"height":12}},{"id":"79591ffb-5351-41f8-89c6-4f25a1f390ca","block_type":"box","text":"liability is only thinly traded or due to the occurrence of a significant event subsequent to the most","page_number":244,"box":{"x":117,"y":382,"width":728,"height":12}},{"id":"b341f2a2-7382-44f4-bc6e-4f65f28e37a3","block_type":"box","text":"recent market quotation. 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In addition,","page_number":244,"box":{"x":117,"y":645,"width":765,"height":12}},{"id":"766e4613-dfdc-414e-b6b3-9c5044e26e24","block_type":"box","text":"the Funds’ accounting agent assists BlackRock by periodically endeavoring to confirm the prices it","page_number":244,"box":{"x":116,"y":661,"width":729,"height":12}},{"id":"bbfad649-b94d-4be1-8eed-c537a34b3a93","block_type":"box","text":"receives from all third-party pricing services, index providers and broker-dealers. BlackRock regularly","page_number":244,"box":{"x":117,"y":676,"width":750,"height":12}},{"id":"10886d12-05fe-4120-9485-78bac4fc9805","block_type":"box","text":"evaluates the values assigned to the securities and other assets and liabilities of the Funds.","page_number":244,"box":{"x":116,"y":692,"width":679,"height":12}},{"id":"a50cdbed-573a-4631-ad96-b57b765ebccc","block_type":"box","text":"When determining the price for a Fair Value Asset, BlackRock will seek to determine the price that a","page_number":244,"box":{"x":116,"y":723,"width":743,"height":12}},{"id":"3d8f18b4-c525-4ebc-96c5-a1e5c73bffaa","block_type":"box","text":"Fund might reasonably expect to receive from the current sale of that asset or liability in an","page_number":244,"box":{"x":117,"y":738,"width":672,"height":12}},{"id":"6920ffed-155e-4849-8a18-a22ea4c3aee0","block_type":"box","text":"arm’s-length transaction on the date on which the asset or liability is being valued, and does not seek","page_number":244,"box":{"x":116,"y":754,"width":751,"height":12}},{"id":"f19e4816-ea67-4678-b128-db3c8b82ad20","block_type":"box","text":"to determine the price a Fund might reasonably expect to receive for selling an asset or liability at a","page_number":244,"box":{"x":116,"y":769,"width":736,"height":12}},{"id":"64ea5ba1-0178-49e0-bb28-08d4fe8b9c21","block_type":"box","text":"later time or if it holds the asset or liability to maturity. 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Prices of actual, executed or historical transactions in the","page_number":245,"box":{"x":117,"y":102,"width":726,"height":12}},{"id":"69a8599d-2919-4cb4-b49a-383a141df107","block_type":"box","text":"relevant investment (or comparable instruments) or, where appropriate, an appraisal by a third-party","page_number":245,"box":{"x":117,"y":118,"width":747,"height":12}},{"id":"afd16c02-e341-400a-84b3-7cec45370f15","block_type":"box","text":"experienced in the valuation of similar instruments, may also be used as a basis for establishing the","page_number":245,"box":{"x":116,"y":134,"width":745,"height":12}},{"id":"fd746f68-e39c-41e0-bfda-42f4b35806fe","block_type":"box","text":"fair value of an investment.","page_number":245,"box":{"x":116,"y":149,"width":206,"height":10}},{"id":"03af5b80-7572-47d0-b403-5add74b4fe1e","block_type":"box","text":"The fair value of one or more assets or liabilities may not, in retrospect, be the price at which those","page_number":245,"box":{"x":116,"y":178,"width":738,"height":13}},{"id":"862e263e-0050-4c03-b84a-7c3d06c35228","block_type":"box","text":"assets or liabilities could have been sold during the period in which the particular fair values were used","page_number":245,"box":{"x":116,"y":194,"width":767,"height":12}},{"id":"d02aa706-a31e-418a-97aa-8a2c2741d78b","block_type":"box","text":"in determining a Fund’s NAV. As a result, a Fund’s sale or redemption of its shares at NAV, at a time","page_number":245,"box":{"x":117,"y":209,"width":752,"height":13}},{"id":"b941a928-9483-4863-a15d-3cdf0fd63cb2","block_type":"box","text":"when a holding or holdings are valued at fair value, may have the effect of diluting or increasing the","page_number":245,"box":{"x":116,"y":225,"width":742,"height":12}},{"id":"7ac86b66-249e-40c7-808d-1fa687a96c14","block_type":"box","text":"economic interest of existing shareholders.","page_number":245,"box":{"x":116,"y":240,"width":323,"height":13}},{"id":"a89e16f2-1ab2-48b4-824b-bdb83fc57400","block_type":"box","text":"Each Fund’s annual audited financial statements, which are prepared in accordance with accounting","page_number":245,"box":{"x":117,"y":270,"width":749,"height":12}},{"id":"8470bc8a-cfb5-4722-acb8-d8bd640b163c","block_type":"box","text":"principles generally accepted in the United States of America (“US GAAP”), follow the requirements for","page_number":245,"box":{"x":117,"y":285,"width":767,"height":13}},{"id":"52e3cc65-ceb4-4fb5-a376-b4896fd17aea","block_type":"box","text":"valuation set forth in Financial Accounting Standards Board Accounting Standards Codification Topic","page_number":245,"box":{"x":116,"y":301,"width":753,"height":12}},{"id":"8045b0e2-f075-44bf-aed4-57de54f8a09e","block_type":"box","text":"820, “Fair Value Measurements and Disclosures” (“ASC 820”), which defines and establishes a","page_number":245,"box":{"x":116,"y":316,"width":712,"height":13}},{"id":"14807d3a-8a4f-4a48-aed7-aadc05861ffe","block_type":"box","text":"framework for measuring fair value under US GAAP and expands financial statement disclosure","page_number":245,"box":{"x":116,"y":332,"width":717,"height":12}},{"id":"bb1f408b-9cbe-479a-a8b8-f0d726c864c2","block_type":"box","text":"requirements relating to fair value measurements.","page_number":245,"box":{"x":117,"y":347,"width":374,"height":13}},{"id":"67fc7b41-6cae-459f-84bc-7a8eac2beab1","block_type":"box","text":"Generally, ASC 820 and other accounting rules applicable to funds and various assets in which they","page_number":245,"box":{"x":117,"y":377,"width":747,"height":12}},{"id":"28b4e987-9207-426d-b37d-1a90e6f41538","block_type":"box","text":"invest are evolving. Such changes may adversely affect a Fund. For example, the evolution of rules","page_number":245,"box":{"x":117,"y":392,"width":743,"height":13}},{"id":"cb6b4852-c90c-43b4-bcbd-6394d3ab3e84","block_type":"box","text":"governing the determination of the fair market value of assets or liabilities, to the extent such rules","page_number":245,"box":{"x":116,"y":408,"width":733,"height":12}},{"id":"652fd87e-85a5-428d-aa82-e392f9324598","block_type":"box","text":"become more stringent, would tend to increase the cost and/or reduce the availability of third-party","page_number":245,"box":{"x":117,"y":423,"width":735,"height":13}},{"id":"18f768ef-f22d-482c-9e1e-b974fc9f059e","block_type":"box","text":"determinations of fair market value. This may in turn increase the costs associated with selling assets","page_number":245,"box":{"x":116,"y":439,"width":758,"height":12}},{"id":"5730f49f-041e-46ec-b917-4bb0f962e778","block_type":"box","text":"or affect their liquidity due to a Fund’s inability to obtain a third-party determination of fair market value.","page_number":245,"box":{"x":116,"y":454,"width":768,"height":13}},{"id":"cdaee0df-9788-4923-a0ed-7cc980797171","block_type":"box","text":"Computation of Offering Price Per Share","page_number":245,"box":{"x":116,"y":484,"width":328,"height":12}},{"id":"87f1a1bb-063d-46a5-af16-27e0f55c0396","block_type":"box","text":"See “Computation of Offering Price Per Share” in Part I of a Fund’s SAI for an illustration of the","page_number":245,"box":{"x":116,"y":506,"width":710,"height":12}},{"id":"e9206e2c-38d9-4cac-892b-97a0f56bbff7","block_type":"box","text":"computation of the offering price for shares of your Fund.","page_number":245,"box":{"x":116,"y":522,"width":429,"height":12}},{"id":"1d58a4f8-f018-4c2c-bd1b-f37840e3dc8f","block_type":"box","text":"P","page_number":245,"box":{"x":337,"y":565,"width":10,"height":10}},{"id":"97a9a094-f810-43f5-aa51-cfb444b7ce17","block_type":"box","text":"ORTFOLIO","page_number":245,"box":{"x":348,"y":568,"width":69,"height":7}},{"id":"1f0c70ae-f266-4dbf-8768-96b1dd531cba","block_type":"box","text":"T","page_number":245,"box":{"x":418,"y":565,"width":14,"height":10}},{"id":"41174e2f-65fc-4f87-8e55-933df6e56545","block_type":"box","text":"RANSACTIONS","page_number":245,"box":{"x":434,"y":568,"width":98,"height":7}},{"id":"74357863-f006-424a-8f2d-19b35c3d9b6e","block_type":"box","text":"AND","page_number":245,"box":{"x":538,"y":568,"width":28,"height":7}},{"id":"339ecaff-5f27-4b29-b0ac-f103fc7b0f5f","block_type":"box","text":"B","page_number":245,"box":{"x":567,"y":565,"width":16,"height":10}},{"id":"f19c8a97-b964-4a36-baf0-84a8105013be","block_type":"box","text":"ROKERAGE","page_number":245,"box":{"x":585,"y":568,"width":77,"height":7}},{"id":"efa245bc-f823-4924-b2d5-7d4df7704ecc","block_type":"box","text":"Transactions in Portfolio Securities","page_number":245,"box":{"x":116,"y":595,"width":288,"height":9}},{"id":"61780f2d-7263-41f8-a4f1-0608df838824","block_type":"box","text":"Subject to policies established by the Board of Directors, BlackRock is primarily responsible for the","page_number":245,"box":{"x":116,"y":617,"width":738,"height":12}},{"id":"88ef49b1-ca6a-494c-8dbb-acb4701b7e3a","block_type":"box","text":"execution of a Fund’s portfolio transactions and the allocation of brokerage. BlackRock does not","page_number":245,"box":{"x":116,"y":633,"width":718,"height":12}},{"id":"2a16cfa4-054f-4323-be39-6540bfc8d822","block_type":"box","text":"execute transactions through any particular broker or dealer, but seeks to obtain the best net results for","page_number":245,"box":{"x":116,"y":648,"width":772,"height":12}},{"id":"c05ea7d5-4a3d-4e16-83d3-9a2e13e99930","block_type":"box","text":"the Fund, taking into account certain factors set out below. While BlackRock generally seeks","page_number":245,"box":{"x":116,"y":664,"width":687,"height":12}},{"id":"7235d0b3-a881-4279-8a4f-8a205815ccbe","block_type":"box","text":"reasonable trade execution costs, a Fund does not necessarily pay the lowest spread or commission","page_number":245,"box":{"x":117,"y":679,"width":746,"height":12}},{"id":"4a31a88c-4fb5-426f-8be0-0ac4a6b01a3b","block_type":"box","text":"available, and payment of the lowest commission or spread is not necessarily consistent with obtaining","page_number":245,"box":{"x":116,"y":695,"width":762,"height":12}},{"id":"072fc45b-0ee2-4c11-8493-d4f404b9473a","block_type":"box","text":"the best price and execution in particular transactions. Subject to applicable legal requirements,","page_number":245,"box":{"x":116,"y":710,"width":708,"height":12}},{"id":"4027e459-8a50-4881-925e-bc1889713696","block_type":"box","text":"BlackRock may select a broker based partly upon brokerage or research services provided to","page_number":245,"box":{"x":117,"y":726,"width":692,"height":12}},{"id":"65b0a32a-26f8-4510-a776-0e043e5e0328","block_type":"box","text":"BlackRock and its clients, including a Fund. In return for such services, BlackRock may cause a Fund","page_number":245,"box":{"x":117,"y":741,"width":752,"height":12}},{"id":"c836a5e0-f13f-40c6-ba85-d8053a0a2034","block_type":"box","text":"to pay a higher commission than other brokers would charge if BlackRock determines in good faith that","page_number":245,"box":{"x":116,"y":757,"width":765,"height":12}},{"id":"a5136c14-1f4b-4792-9e6b-ed8ca26e836b","block_type":"box","text":"the commission is reasonable in relation to the services provided.","page_number":245,"box":{"x":116,"y":772,"width":485,"height":12}},{"id":"7daef200-ca3b-492b-bafc-01b7f9d2d1df","block_type":"box","text":"In the case of Feeder Funds, because each Feeder Fund generally invests exclusively in beneficial","page_number":245,"box":{"x":117,"y":802,"width":733,"height":12}},{"id":"70158738-46bc-4430-83be-55a6b142043e","block_type":"box","text":"interests of a Master Portfolio, it is expected that all transactions in portfolio securities will be entered","page_number":245,"box":{"x":117,"y":817,"width":745,"height":12}},{"id":"da390a9e-1e0a-47b3-bd50-d8d96fe6dc88","block_type":"box","text":"into by the Master Portfolio.","page_number":245,"box":{"x":117,"y":833,"width":208,"height":12}},{"id":"952a9132-44a2-4d74-99a3-866ffdff6287","block_type":"box","text":"In selecting brokers or dealers to execute portfolio transactions, the Manager and sub-advisers seek to","page_number":245,"box":{"x":117,"y":862,"width":767,"height":12}},{"id":"b7ee85e5-f6f3-4a45-bfd6-a4a6b429df74","block_type":"box","text":"obtain the best price and most favorable execution for a Fund, taking into account a variety of factors","page_number":245,"box":{"x":116,"y":878,"width":754,"height":12}},{"id":"b43a56f2-ff3a-472b-84ba-849f28cd2fef","block_type":"box","text":"II-158","page_number":245,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"fea66022-958a-4d7a-88d7-49378aeb1ac4","block_type":"box","text":"NM1026U-6004382-245/605","page_number":245,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c7de6c8a-4e43-4dc9-bc85-80d88ec8a8bb","block_type":"box","text":"including: (i) the size, nature and character of the security or instrument being traded and the markets","page_number":246,"box":{"x":117,"y":87,"width":758,"height":12}},{"id":"a7b6e5cb-e235-4d22-8b31-e71792df246c","block_type":"box","text":"in which it is purchased or sold; (ii) the desired timing of the transaction; (iii) BlackRock’s knowledge of","page_number":246,"box":{"x":117,"y":102,"width":764,"height":13}},{"id":"1065627d-68eb-4e0c-ad37-aea87d46f956","block_type":"box","text":"the expected commission rates and spreads currently available; (iv) the activity existing and expected","page_number":246,"box":{"x":116,"y":118,"width":759,"height":12}},{"id":"6a84ee7d-06a8-4686-9ccc-090e090e958d","block_type":"box","text":"in the market for the particular security or instrument, including any anticipated execution difficulties;","page_number":246,"box":{"x":117,"y":134,"width":746,"height":12}},{"id":"69cc6acc-8a3a-4258-b64a-8f8f31dba130","block_type":"box","text":"(v) the full range of brokerage services provided; (vi) the broker’s or dealer’s capital; (vii) the quality of","page_number":246,"box":{"x":117,"y":149,"width":759,"height":12}},{"id":"b531aae8-c2e9-44cd-aab3-2667af30b9cf","block_type":"box","text":"research and research services provided; (viii) the reasonableness of the commission, dealer spread","page_number":246,"box":{"x":117,"y":165,"width":752,"height":12}},{"id":"eb5b8d45-d7f7-4192-92cf-d9d659109b6b","block_type":"box","text":"or its equivalent for the specific transaction; and (ix) BlackRock’s knowledge of any actual or apparent","page_number":246,"box":{"x":116,"y":180,"width":760,"height":12}},{"id":"e6ebe996-b16f-4f8c-acf2-68c69babed3e","block_type":"box","text":"operational problems of a broker or dealer.","page_number":246,"box":{"x":116,"y":196,"width":323,"height":11}},{"id":"73dd7167-dfb9-4487-8179-5957d595059f","block_type":"box","text":"Section 28(e) of the Exchange Act (“Section 28(e)”) permits an investment adviser, under certain","page_number":246,"box":{"x":116,"y":227,"width":723,"height":12}},{"id":"274d28c5-bcd4-48ce-8d4a-99b046f945c6","block_type":"box","text":"circumstances to cause an account to pay a broker or dealer a commission for effecting a transaction","page_number":246,"box":{"x":116,"y":242,"width":757,"height":12}},{"id":"6d6b96b1-8dfe-46d7-ad38-c486eb46673d","block_type":"box","text":"that exceeds the amount another broker or dealer would have charged for effecting the same","page_number":246,"box":{"x":116,"y":258,"width":696,"height":12}},{"id":"64b6a86d-433f-46fe-8e58-b8a8c0a79515","block_type":"box","text":"transaction in recognition of the value of brokerage and research services provided by that broker or","page_number":246,"box":{"x":116,"y":273,"width":748,"height":12}},{"id":"b326d34b-89bb-42b2-80b8-325194609d6c","block_type":"box","text":"dealer. This includes commissions paid on riskless principal transactions under certain conditions.","page_number":246,"box":{"x":116,"y":289,"width":732,"height":12}},{"id":"195e03f2-4a29-4412-829a-d369567210af","block_type":"box","text":"Brokerage and research services include: (1) furnishing advice as to the value of securities, including","page_number":246,"box":{"x":117,"y":304,"width":754,"height":12}},{"id":"350d4f69-cc82-498e-91d7-f8843dc2b16f","block_type":"box","text":"pricing and appraisal advice, credit analysis, risk measurement analysis, performance and other","page_number":246,"box":{"x":117,"y":320,"width":716,"height":12}},{"id":"6b508260-3d58-4854-a698-e3f8f5ec9ff1","block_type":"box","text":"analysis, as well as the advisability of investing in, purchasing or selling securities, and the availability","page_number":246,"box":{"x":116,"y":335,"width":758,"height":12}},{"id":"69265dae-d340-49e4-858e-0804ad5b53c2","block_type":"box","text":"of securities or purchasers or sellers of securities; (2) furnishing analyses and reports concerning","page_number":246,"box":{"x":116,"y":351,"width":725,"height":12}},{"id":"2477a0ef-3026-4752-8c86-15b20d2f208d","block_type":"box","text":"issuers, industries, securities, economic factors and trends, portfolio strategy, and the performance of","page_number":246,"box":{"x":117,"y":366,"width":757,"height":12}},{"id":"91ac74db-caf0-4a50-8fe5-0de0f03f06c8","block_type":"box","text":"accounts; and (3) effecting securities transactions and performing functions incidental to securities","page_number":246,"box":{"x":116,"y":382,"width":734,"height":12}},{"id":"ae261077-b491-4c0d-9dd3-b62abf2471ca","block_type":"box","text":"transactions (such as clearance, settlement, and custody). BlackRock believes that access to","page_number":246,"box":{"x":116,"y":397,"width":698,"height":12}},{"id":"aebd05ce-9c0a-4a4d-bb20-36914879b832","block_type":"box","text":"independent investment research is beneficial to its investment decision-making processes and,","page_number":246,"box":{"x":117,"y":413,"width":716,"height":12}},{"id":"a83142a8-cd9b-42a2-85df-be979e952ae4","block_type":"box","text":"therefore, to the Funds.","page_number":246,"box":{"x":116,"y":428,"width":180,"height":11}},{"id":"0aab4703-b4a0-4622-a806-e9ef01c54508","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may participate in client commission arrangements","page_number":246,"box":{"x":117,"y":459,"width":739,"height":12}},{"id":"7f74f730-0a17-4783-81f7-fd416a73463c","block_type":"box","text":"under which BlackRock may execute transactions through a broker-dealer and request that the broker","page_number":246,"box":{"x":117,"y":475,"width":762,"height":12}},{"id":"0d82dc2e-4ebf-4547-bcf9-79eddfc1618d","block_type":"box","text":"dealer allocate a portion of the commissions or commission credits to another firm that provides","page_number":246,"box":{"x":116,"y":490,"width":715,"height":12}},{"id":"47421fc5-1801-4703-a148-b8c78ca724ae","block_type":"box","text":"research to BlackRock. BlackRock believes that research services obtained through soft dollar or","page_number":246,"box":{"x":117,"y":506,"width":725,"height":12}},{"id":"199881f8-6bcb-4700-a453-13b80b030994","block_type":"box","text":"commission sharing arrangements enhance its investment decision-making capabilities, thereby","page_number":246,"box":{"x":116,"y":521,"width":718,"height":12}},{"id":"5c289273-4399-4d23-9b1d-e5ae61c22ed2","block_type":"box","text":"increasing the prospects for higher investment returns. BlackRock will engage only in soft dollar or","page_number":246,"box":{"x":117,"y":537,"width":733,"height":12}},{"id":"d4ed4fdb-75d2-4410-8d9a-2d90e440b300","block_type":"box","text":"commission sharing transactions that comply with the requirements of Section 28(e). Certain Funds","page_number":246,"box":{"x":116,"y":552,"width":744,"height":12}},{"id":"21b4d6a6-4855-457e-bad3-eddf71f5e01d","block_type":"box","text":"may be subject to additional regulations, including MiFID II. Under MiFID II, EU investment managers,","page_number":246,"box":{"x":117,"y":568,"width":760,"height":12}},{"id":"688bf5f9-8220-4dd7-b418-e2a72e94decf","block_type":"box","text":"including BIL, pay for any research out of their own resources and not through soft dollars or","page_number":246,"box":{"x":117,"y":583,"width":689,"height":12}},{"id":"0ec60e1b-23c1-44c8-9e5d-91f75d8856d0","block_type":"box","text":"commission sharing arrangements. BlackRock regularly evaluates the soft dollar products and services","page_number":246,"box":{"x":116,"y":599,"width":771,"height":12}},{"id":"4736e03f-558d-4c25-9823-044363c0aa1f","block_type":"box","text":"utilized, as well as the overall soft dollar and commission sharing arrangements to ensure that trades","page_number":246,"box":{"x":117,"y":614,"width":753,"height":12}},{"id":"24d3b76d-305c-4d88-8534-b57df0f7286d","block_type":"box","text":"are executed by firms that are regarded as best able to execute trades for client accounts, while at the","page_number":246,"box":{"x":116,"y":630,"width":764,"height":12}},{"id":"7415cf56-1763-45f0-8e4f-148e8f165771","block_type":"box","text":"same time providing access to the research and other services BlackRock views as impactful to its","page_number":246,"box":{"x":116,"y":645,"width":737,"height":12}},{"id":"f6ef68bd-93d1-4c34-80ba-48f2d7c22d3e","block_type":"box","text":"trading results.","page_number":246,"box":{"x":116,"y":661,"width":109,"height":12}},{"id":"ddc35799-8387-4057-bc56-4ab28e773a4c","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may utilize soft dollars and related services, including","page_number":246,"box":{"x":117,"y":692,"width":752,"height":12}},{"id":"4e257f74-95f8-40c0-aae8-fc9e9822322c","block_type":"box","text":"research (whether prepared by the broker-dealer or prepared by a third-party and provided to","page_number":246,"box":{"x":117,"y":707,"width":691,"height":12}},{"id":"092ac014-e528-430e-a868-7b055bbddc5e","block_type":"box","text":"BlackRock by the broker-dealer) and execution or brokerage services within applicable rules and","page_number":246,"box":{"x":117,"y":723,"width":716,"height":12}},{"id":"ab76a9de-99b2-44b2-8d27-4f57f578b549","block_type":"box","text":"BlackRock’s policies to the extent that such permitted services do not compromise BlackRock’s ability","page_number":246,"box":{"x":117,"y":738,"width":754,"height":12}},{"id":"7c83fdee-871b-4bb2-9262-c19fc79ff4f0","block_type":"box","text":"to seek to obtain best execution. In this regard, the portfolio management investment and/or trading","page_number":246,"box":{"x":116,"y":754,"width":738,"height":12}},{"id":"d57baee1-64b5-49d2-938e-ad3096fa373b","block_type":"box","text":"teams may consider a variety of factors, including the degree to which the broker-dealer: (a) provides","page_number":246,"box":{"x":116,"y":769,"width":751,"height":12}},{"id":"be750db0-a8f4-4969-9eb1-5babf3b8a817","block_type":"box","text":"access to company management; (b) provides access to their analysts; (c) provides meaningful/","page_number":246,"box":{"x":116,"y":785,"width":714,"height":12}},{"id":"1a539eb1-06d7-44a6-8451-1c4d57d07070","block_type":"box","text":"insightful research notes on companies or other potential investments; (d) facilitates calls on which","page_number":246,"box":{"x":117,"y":800,"width":729,"height":12}},{"id":"aff56929-5ab0-474a-966b-34910be4e83c","block_type":"box","text":"meaningful or insightful ideas about companies or potential investments are discussed; (e) facilitates","page_number":246,"box":{"x":117,"y":816,"width":745,"height":12}},{"id":"3076e012-adc6-496b-a5a4-27dcdd519a1b","block_type":"box","text":"conferences at which meaningful or insightful ideas about companies or potential investments are","page_number":246,"box":{"x":116,"y":831,"width":729,"height":12}},{"id":"79f2f390-f3e3-4e6b-90be-3421c824206b","block_type":"box","text":"discussed; or (f) provides research tools such as market data, financial analysis, and other third-party","page_number":246,"box":{"x":116,"y":847,"width":757,"height":12}},{"id":"70fdb1d3-c121-4520-ac7b-5206b2b6e205","block_type":"box","text":"related research and brokerage tools that aid in the investment process.","page_number":246,"box":{"x":117,"y":862,"width":539,"height":12}},{"id":"1e2845f5-d798-41a5-9389-282236150437","block_type":"box","text":"II-159","page_number":246,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"4b5bbc0a-16c7-42d1-9b56-df607fe456ef","block_type":"box","text":"NM1026U-6004382-246/605","page_number":246,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"be04f629-b49d-403e-abd6-15ff156e2585","block_type":"box","text":"Research-oriented services for which BlackRock, unless prohibited by applicable law, might pay with","page_number":247,"box":{"x":117,"y":87,"width":751,"height":12}},{"id":"cb6272b7-0097-4595-8927-8666e73147d1","block_type":"box","text":"Fund commissions may be in written form or through direct contact with individuals and may include","page_number":247,"box":{"x":117,"y":102,"width":745,"height":13}},{"id":"c705bd56-9771-49bf-9722-00ca4197ab8d","block_type":"box","text":"information as to particular companies or industries and securities or groups of securities, as well as","page_number":247,"box":{"x":117,"y":118,"width":746,"height":12}},{"id":"f83fd7cf-2ad9-48a1-8b99-36af67a88585","block_type":"box","text":"market, economic, or institutional advice and statistical information, political developments and","page_number":247,"box":{"x":117,"y":134,"width":705,"height":11}},{"id":"e8787e24-d8c9-42c7-9155-e61bf458f458","block_type":"box","text":"technical market information that assists in the valuation of investments. Except as noted immediately","page_number":247,"box":{"x":116,"y":149,"width":760,"height":12}},{"id":"d09ab42e-3751-44b8-a3d3-66240de47bd6","block_type":"box","text":"below, research services furnished by brokers may be used in servicing some or all client accounts","page_number":247,"box":{"x":117,"y":165,"width":739,"height":12}},{"id":"ee1db9ed-6cd9-4797-849d-545842441caa","block_type":"box","text":"and not all services may be used in connection with the Fund or account that paid commissions to the","page_number":247,"box":{"x":116,"y":180,"width":760,"height":12}},{"id":"f8751ed3-6c65-4a9b-9cca-8fba3aa6bc56","block_type":"box","text":"broker providing such services. In some cases, research information received from brokers by mutual","page_number":247,"box":{"x":117,"y":196,"width":757,"height":12}},{"id":"b4d2fea1-b4fe-45f6-baa4-b87450af5aee","block_type":"box","text":"fund management personnel, or personnel principally responsible for BlackRock’s individually","page_number":247,"box":{"x":116,"y":211,"width":699,"height":12}},{"id":"253b97ef-e976-4186-835e-d8c4340c0c1e","block_type":"box","text":"managed portfolios, is not necessarily shared by and between such personnel. Any investment","page_number":247,"box":{"x":117,"y":227,"width":708,"height":12}},{"id":"79b2d38a-1be8-41f8-a544-10504f2f66a4","block_type":"box","text":"advisory or other fees paid by a Fund to BlackRock are not reduced as a result of BlackRock’s receipt","page_number":247,"box":{"x":116,"y":242,"width":760,"height":12}},{"id":"e413d455-1d3f-4297-b4d4-3582681ad85c","block_type":"box","text":"of research services. In some cases, BlackRock may receive a service from a broker that has both a","page_number":247,"box":{"x":116,"y":258,"width":750,"height":12}},{"id":"5fea1fc0-7686-4e72-b1c5-d59655ca9825","block_type":"box","text":"“research” and a “non-research” use. When this occurs BlackRock makes a good faith allocation,","page_number":247,"box":{"x":116,"y":273,"width":725,"height":12}},{"id":"474a8c6b-1fb2-4eb5-8818-85342aed6ee6","block_type":"box","text":"under all the circumstances, between the research and non-research uses of the service. The","page_number":247,"box":{"x":117,"y":289,"width":700,"height":11}},{"id":"5354f638-7be1-4e83-aaa1-b7f398c4959d","block_type":"box","text":"percentage of the service that is used for research purposes may be paid for with client commissions,","page_number":247,"box":{"x":117,"y":304,"width":758,"height":12}},{"id":"f2e62de1-ae9f-4834-bd32-cd7d5aa3e3fc","block_type":"box","text":"while BlackRock will use its own funds to pay for the percentage of the service that is used for","page_number":247,"box":{"x":116,"y":320,"width":701,"height":12}},{"id":"de6da161-4dad-4c35-ae38-fbc0e92b1461","block_type":"box","text":"non-research purposes. In making this good faith allocation, BlackRock faces a potential conflict of","page_number":247,"box":{"x":117,"y":335,"width":736,"height":12}},{"id":"bdf1a539-cf95-4772-8686-88ff17bfe43e","block_type":"box","text":"interest, but BlackRock believes that its allocation procedures are reasonably designed to ensure that it","page_number":247,"box":{"x":117,"y":351,"width":771,"height":12}},{"id":"23331d70-70a9-4bb3-b2df-42a443facf79","block_type":"box","text":"appropriately allocates the anticipated use of such services to their research and non-research uses.","page_number":247,"box":{"x":116,"y":366,"width":752,"height":12}},{"id":"7790e4bb-c567-490e-a6a2-a4ecc9200acc","block_type":"box","text":"Under MiFID II, investment managers in the EU, including BIL, are not able to use soft dollars to pay","page_number":247,"box":{"x":117,"y":397,"width":748,"height":12}},{"id":"eab0f18c-2a53-4597-9b86-df25763880ed","block_type":"box","text":"for research from brokers. Investment managers in the EU are required to either pay for research out","page_number":247,"box":{"x":116,"y":413,"width":754,"height":12}},{"id":"61981545-172f-42d5-bf76-73e709147d6c","block_type":"box","text":"of their own profit and loss or agree with clients to have research costs paid by clients through","page_number":247,"box":{"x":116,"y":428,"width":702,"height":12}},{"id":"4c402cc5-48f1-4df8-a2cf-858b86dd6a29","block_type":"box","text":"research payment accounts that are directly funded or funded by a specific client research charge","page_number":247,"box":{"x":117,"y":444,"width":730,"height":12}},{"id":"e31e803b-309b-4870-b4d6-79804126dabf","block_type":"box","text":"collected alongside execution commissions, provided that the payments for research are unbundled","page_number":247,"box":{"x":116,"y":459,"width":745,"height":12}},{"id":"ba0bcfeb-12ae-490d-a8de-a94d8536aafc","block_type":"box","text":"from the payments for execution. BIL will pay for any research out of its own resources and not through","page_number":247,"box":{"x":116,"y":475,"width":771,"height":12}},{"id":"581153e2-e6a5-4f6b-8b23-36c4b4348749","block_type":"box","text":"soft dollars or commission sharing arrangements.","page_number":247,"box":{"x":116,"y":490,"width":372,"height":12}},{"id":"99f02d99-ba5f-45d6-90ba-a18981a1cbac","block_type":"box","text":"Payments of commissions to brokers who are affiliated persons of the Fund, or the Master Portfolio","page_number":247,"box":{"x":117,"y":521,"width":740,"height":12}},{"id":"156aeedc-22c4-4a49-b0a5-86149445c70e","block_type":"box","text":"with respect to the Feeder Fund (or affiliated persons of such persons), will be made in accordance","page_number":247,"box":{"x":116,"y":537,"width":741,"height":12}},{"id":"a1cfcff7-a80a-4bb6-b14f-63afdcc0114e","block_type":"box","text":"with Rule 17e-1 under the Investment Company Act. Subject to policies established by the Board of","page_number":247,"box":{"x":116,"y":552,"width":743,"height":12}},{"id":"64e4ea2e-f719-43de-9580-bd353314117c","block_type":"box","text":"Directors of the Master Portfolio, BlackRock is primarily responsible for the execution of the Master","page_number":247,"box":{"x":117,"y":568,"width":737,"height":12}},{"id":"bb83c923-e695-46ee-a445-c48c608d58b1","block_type":"box","text":"Portfolio’s portfolio transactions and the allocation of brokerage.","page_number":247,"box":{"x":117,"y":583,"width":478,"height":12}},{"id":"fe7d5978-7bf7-420f-a373-b6c04864781f","block_type":"box","text":"From time to time, a Fund may purchase new issues of securities in a fixed price offering. In these","page_number":247,"box":{"x":117,"y":614,"width":733,"height":12}},{"id":"27ea25ec-863e-4a2b-b514-3c22b796d2ca","block_type":"box","text":"situations, the broker may be a member of the selling group that will, in addition to selling securities,","page_number":247,"box":{"x":116,"y":630,"width":746,"height":12}},{"id":"c2993e60-d4ac-4a8b-bc45-999a88c18f3d","block_type":"box","text":"provide BlackRock with research services. FINRA has adopted rules expressly permitting these types","page_number":247,"box":{"x":117,"y":645,"width":757,"height":12}},{"id":"f481923f-8570-4f53-9446-b5c30b48823b","block_type":"box","text":"of arrangements under certain circumstances. Generally, the broker will provide research “credits” in","page_number":247,"box":{"x":116,"y":661,"width":744,"height":12}},{"id":"18898427-908c-4043-b466-21bfa5050545","block_type":"box","text":"these situations at a rate that is higher than that available for typical secondary market transactions.","page_number":247,"box":{"x":116,"y":676,"width":739,"height":12}},{"id":"84f594fb-a253-4912-8bfb-55901b86c23f","block_type":"box","text":"These arrangements may not fall within the safe harbor of Section 28(e).","page_number":247,"box":{"x":116,"y":692,"width":538,"height":12}},{"id":"f834db5b-55ef-492d-a331-8af53b5836c6","block_type":"box","text":"BlackRock does not consider sales of shares of the mutual funds it advises as a factor in the selection","page_number":247,"box":{"x":117,"y":723,"width":756,"height":9}},{"id":"6734edf8-edbc-4120-bc3f-66bd544d31f7","block_type":"box","text":"of brokers or dealers to execute portfolio transactions for a Fund; however, whether or not a particular","page_number":247,"box":{"x":116,"y":738,"width":756,"height":12}},{"id":"8929da60-ecc1-4a89-a2d9-e1e05d51b575","block_type":"box","text":"broker or dealer sells shares of the mutual funds advised by BlackRock neither qualifies nor","page_number":247,"box":{"x":117,"y":754,"width":680,"height":12}},{"id":"cf599c26-6e0c-41db-9213-9ccb29d094d4","block_type":"box","text":"disqualifies such broker or dealer to execute transactions for those mutual funds.","page_number":247,"box":{"x":116,"y":769,"width":599,"height":12}},{"id":"5af63062-02ea-4cee-97a8-00d836cfc54d","block_type":"box","text":"Each Fund anticipates that its brokerage transactions involving foreign securities generally will be","page_number":247,"box":{"x":117,"y":800,"width":721,"height":12}},{"id":"d42ac1b1-7825-43e3-99e1-f16e33647c70","block_type":"box","text":"conducted primarily on the principal stock exchanges of the applicable country. Foreign equity","page_number":247,"box":{"x":116,"y":816,"width":697,"height":12}},{"id":"1c4753e4-a0e8-444b-8965-f279092be601","block_type":"box","text":"securities may be held by a Fund in the form of depositary receipts, or other securities convertible into","page_number":247,"box":{"x":116,"y":831,"width":762,"height":12}},{"id":"849c01d9-686f-4970-9df1-bb5390ee9e99","block_type":"box","text":"foreign equity securities. Depositary receipts may be listed on stock exchanges, or traded in OTC","page_number":247,"box":{"x":116,"y":847,"width":727,"height":12}},{"id":"4ee01649-89db-4b93-8455-a8b6e804fbcb","block_type":"box","text":"markets in the United States or Europe, as the case may be. American Depositary Receipts, like other","page_number":247,"box":{"x":117,"y":862,"width":762,"height":12}},{"id":"2a25ec27-650e-4f14-b3d6-bdfdb5f32e97","block_type":"box","text":"securities traded in the United States, will be subject to negotiated commission rates. Because the","page_number":247,"box":{"x":116,"y":878,"width":734,"height":12}},{"id":"6bfec4cd-c9b6-4f7d-8b6d-1b5c78cb3d6f","block_type":"box","text":"II-160","page_number":247,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"adbf9abf-c912-4eb3-b002-15581b75a98e","block_type":"box","text":"NM1026U-6004382-247/605","page_number":247,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"1555c137-ad5c-4643-9453-9115d8129bb6","block_type":"box","text":"shares of each Fund are redeemable on a daily basis in U.S. dollars, each Fund intends to manage its","page_number":248,"box":{"x":116,"y":87,"width":764,"height":12}},{"id":"37faad36-a816-4c6a-b568-5c9403ce1b83","block_type":"box","text":"portfolio so as to give reasonable assurance that it will be able to obtain U.S. dollars to the extent","page_number":248,"box":{"x":117,"y":102,"width":725,"height":13}},{"id":"a18e2409-dc44-486c-b880-f873b27ba43f","block_type":"box","text":"necessary to meet anticipated redemptions. Under present conditions, it is not believed that these","page_number":248,"box":{"x":117,"y":118,"width":730,"height":12}},{"id":"2cc89005-e293-4e0a-adb6-4453114997c8","block_type":"box","text":"considerations will have a significant effect on a Fund’s portfolio strategies.","page_number":248,"box":{"x":116,"y":134,"width":561,"height":12}},{"id":"61b2c397-2363-41b5-a0d2-49f41aa83052","block_type":"box","text":"See “Portfolio Transactions and Brokerage” in the","page_number":248,"box":{"x":116,"y":165,"width":366,"height":12}},{"id":"16807e7a-928e-4914-9b50-619c7a161be7","block_type":"box","text":"SAI for information about the brokerage commissions","page_number":248,"box":{"x":482,"y":165,"width":392,"height":12}},{"id":"f6937d5e-5866-4c29-b617-07906cca3566","block_type":"box","text":"paid by your Fund, including commissions paid to a","page_number":248,"box":{"x":117,"y":180,"width":371,"height":12}},{"id":"e3e985a0-5ae3-4182-9350-5cc055b5be07","block_type":"box","text":"ffiliates, if any, for the periods indicated.","page_number":248,"box":{"x":489,"y":180,"width":293,"height":12}},{"id":"09b5aa14-5c91-4514-bab1-701e35e0f185","block_type":"box","text":"Each Fund may invest in certain securities traded in the OTC market and intends to deal directly with","page_number":248,"box":{"x":117,"y":211,"width":753,"height":12}},{"id":"2463a991-fe0f-427e-9e7e-ee6b55903726","block_type":"box","text":"the dealers who make a market in the particular securities, except in those circumstances in which","page_number":248,"box":{"x":116,"y":227,"width":735,"height":11}},{"id":"464f5113-5efb-450c-98e8-3f0e9db70d7b","block_type":"box","text":"better prices and execution are available elsewhere. Under the Investment Company Act, persons","page_number":248,"box":{"x":117,"y":242,"width":732,"height":12}},{"id":"d7953607-f6c7-403d-8f81-cfb24095a6c7","block_type":"box","text":"affiliated with a Fund and persons who are affiliated with such affiliated persons are prohibited from","page_number":248,"box":{"x":116,"y":258,"width":741,"height":11}},{"id":"d7ad68e2-8d5a-442a-8095-80aa445fb310","block_type":"box","text":"dealing with the Fund as principal in the purchase and sale of securities unless a permissive order","page_number":248,"box":{"x":116,"y":273,"width":733,"height":12}},{"id":"101182ab-ce37-4a96-8c66-71451d5eadcb","block_type":"box","text":"allowing such transactions is obtained from the Commission. Since transactions in the OTC market","page_number":248,"box":{"x":116,"y":289,"width":740,"height":12}},{"id":"9f0822f8-7098-422b-a880-fead2d69a6fa","block_type":"box","text":"usually involve transactions with the dealers acting as principal for their own accounts, the Funds will","page_number":248,"box":{"x":117,"y":304,"width":752,"height":12}},{"id":"782a2422-5c32-413b-b8b9-e644134d9ff8","block_type":"box","text":"not deal with affiliated persons in connection with such transactions. However, an affiliated person of a","page_number":248,"box":{"x":117,"y":320,"width":764,"height":12}},{"id":"4b00ca27-1ccb-4e0a-968a-4512a65f2ef2","block_type":"box","text":"Fund may serve as its broker in OTC transactions conducted on an agency basis provided that, among","page_number":248,"box":{"x":117,"y":335,"width":769,"height":12}},{"id":"7fa9c95d-7cbd-480f-8ecc-903c07d5396e","block_type":"box","text":"other things, the fee or commission received by such affiliated broker is reasonable and fair compared","page_number":248,"box":{"x":116,"y":351,"width":762,"height":12}},{"id":"9d45db9e-c7a0-4c71-85ff-e8bc901756c2","block_type":"box","text":"to the fee or commission received by non-affiliated brokers in connection with comparable transactions.","page_number":248,"box":{"x":116,"y":366,"width":772,"height":12}},{"id":"a7248ca4-0586-4de0-b5fa-0ac6968bb8f7","block_type":"box","text":"OTC issues, including most fixed-income securities such as corporate debt and U.S. Government","page_number":248,"box":{"x":116,"y":397,"width":729,"height":12}},{"id":"1fa6d767-063e-43e5-9291-d07437a8c347","block_type":"box","text":"Securities, are normally traded on a “net” basis without a stated commission, through dealers acting for","page_number":248,"box":{"x":116,"y":413,"width":770,"height":12}},{"id":"3d7539ad-b172-440e-8576-1e74d4574746","block_type":"box","text":"their own account and not as brokers. The Funds will primarily engage in transactions with these","page_number":248,"box":{"x":116,"y":428,"width":721,"height":12}},{"id":"04f5135b-b0c2-4daf-815a-19953a0be495","block_type":"box","text":"dealers or deal directly with the issuer unless a better price or execution could be obtained by using a","page_number":248,"box":{"x":116,"y":444,"width":757,"height":12}},{"id":"93b6f960-2c10-476d-b43c-f9f3643a3299","block_type":"box","text":"broker. Prices paid to a dealer with respect to both foreign and domestic securities will generally","page_number":248,"box":{"x":117,"y":459,"width":716,"height":12}},{"id":"ac8cd854-0c1d-430b-a229-7343a225848d","block_type":"box","text":"include a “spread,” which is the difference between the prices at which the dealer is willing to purchase","page_number":248,"box":{"x":117,"y":475,"width":766,"height":12}},{"id":"b77ceabd-ed93-4196-b2b8-9d0c47056b1b","block_type":"box","text":"and sell the specific security at the time, and includes the dealer’s normal profit.","page_number":248,"box":{"x":116,"y":490,"width":596,"height":12}},{"id":"74b784cd-1817-4485-837c-138328592164","block_type":"box","text":"Purchases of money market instruments by a Fund are made from dealers, underwriters and issuers.","page_number":248,"box":{"x":117,"y":521,"width":756,"height":12}},{"id":"663af222-4fbc-4161-8475-7e0a8c40a448","block_type":"box","text":"The Funds do not currently expect to incur any brokerage commission expense on such transactions","page_number":248,"box":{"x":116,"y":537,"width":753,"height":12}},{"id":"5162dfce-cec3-4da6-8c16-ee6b0dc8216a","block_type":"box","text":"because money market instruments are generally traded on a “net” basis with dealers acting as","page_number":248,"box":{"x":117,"y":552,"width":712,"height":12}},{"id":"4aa790b6-914a-4859-a398-44ca5c2dc1db","block_type":"box","text":"principal for their own accounts without a stated commission. The price of the security, however,","page_number":248,"box":{"x":117,"y":568,"width":718,"height":12}},{"id":"823297e0-5b43-44ba-bb86-7323e46c2d72","block_type":"box","text":"usually includes a profit to the dealer. Each money market fund intends to purchase only securities with","page_number":248,"box":{"x":117,"y":583,"width":771,"height":12}},{"id":"c2090949-ee6a-4991-8aca-5f316b4fe13a","block_type":"box","text":"remaining maturities of 397 days or less as determined in accordance with the rules of the","page_number":248,"box":{"x":117,"y":599,"width":672,"height":12}},{"id":"4099049c-16cf-4e36-bffe-11eae3af3919","block_type":"box","text":"Commission. As a result, the portfolio turnover rates of a money market fund will be relatively high.","page_number":248,"box":{"x":117,"y":614,"width":736,"height":12}},{"id":"fc6df44c-2c2e-469d-aff6-272a57d11840","block_type":"box","text":"However, because brokerage commissions will not normally be paid with respect to investments made","page_number":248,"box":{"x":117,"y":630,"width":764,"height":12}},{"id":"b2675236-2f73-4498-b55a-44fc0b1391ea","block_type":"box","text":"by a money market fund, the turnover rates should","page_number":248,"box":{"x":117,"y":645,"width":380,"height":12}},{"id":"3f693404-6732-4cb4-a207-c193aeb45e46","block_type":"box","text":"not adversely affect the Fund’s NAVs or net","page_number":248,"box":{"x":498,"y":645,"width":328,"height":12}},{"id":"09097859-409e-4ed7-903e-fb324178f948","block_type":"box","text":"income.","page_number":248,"box":{"x":117,"y":661,"width":56,"height":9}},{"id":"9f2ba125-e3aa-4af1-8a71-54e139e04d4e","block_type":"box","text":"Securities purchased in underwritten offerings include a fixed amount of compensation to the","page_number":248,"box":{"x":116,"y":692,"width":689,"height":12}},{"id":"b771c663-3151-48f5-bd60-ba25673cafb1","block_type":"box","text":"underwriter, generally referred to as the underwriter’s concession or discount. When offered securities","page_number":248,"box":{"x":117,"y":707,"width":756,"height":12}},{"id":"e1d9e99d-716e-4272-90b4-d5dc35a840a9","block_type":"box","text":"are purchased or sold directly from or to an issuer, no commissions or discounts are paid except where","page_number":248,"box":{"x":116,"y":723,"width":766,"height":12}},{"id":"48e5efe8-4b08-4d46-b2fb-b3d677d38955","block_type":"box","text":"required by local markets.","page_number":248,"box":{"x":117,"y":738,"width":190,"height":12}},{"id":"ffe23150-b2e0-4796-aaba-6b6591efe54e","block_type":"box","text":"The Manager or sub-advisers may seek to obtain an undertaking from issuers of commercial paper or","page_number":248,"box":{"x":116,"y":769,"width":755,"height":12}},{"id":"69f7f605-b623-4b21-89a0-b18c3f47c4f8","block_type":"box","text":"dealers selling commercial paper to consider the repurchase of such securities from a Fund prior to","page_number":248,"box":{"x":116,"y":785,"width":736,"height":12}},{"id":"e38e27b1-1924-4d10-8fbf-c3f113c06d7c","block_type":"box","text":"maturity at their original cost plus interest (sometimes adjusted to reflect the actual maturity of the","page_number":248,"box":{"x":117,"y":800,"width":723,"height":12}},{"id":"9c209670-3a91-4acd-a619-bef75117b694","block_type":"box","text":"securities), if it believes that a Fund’s anticipated need for liquidity makes such action desirable. Any","page_number":248,"box":{"x":116,"y":816,"width":744,"height":12}},{"id":"bf046535-2dab-4ed9-bd5b-da9f7013629a","block_type":"box","text":"such repurchase prior to maturity reduces the possibility that a Fund would incur a capital loss in","page_number":248,"box":{"x":116,"y":831,"width":720,"height":12}},{"id":"3e4d0995-5b17-41aa-8630-995cabeaa9dc","block_type":"box","text":"liquidating commercial paper, especially if interest rates have risen since acquisition of such","page_number":248,"box":{"x":117,"y":847,"width":685,"height":12}},{"id":"44d83bd7-84cc-4447-a8a9-ba830ba090bd","block_type":"box","text":"commercial paper.","page_number":248,"box":{"x":116,"y":862,"width":143,"height":12}},{"id":"c8e4eccf-9286-4211-9c47-d5a920ef831e","block_type":"box","text":"II-161","page_number":248,"box":{"x":480,"y":909,"width":38,"height":9}},{"id":"eb218daf-fd75-41ae-9bc2-90ad043375a7","block_type":"box","text":"NM1026U-6004382-248/605","page_number":248,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3c9d9e41-93b6-4580-93f8-88ad07b111b2","block_type":"box","text":"Investment decisions for each Fund and for other investment accounts managed by the Manager or","page_number":249,"box":{"x":117,"y":87,"width":744,"height":12}},{"id":"14fcb548-5c14-4cf2-9e97-1b42332dcda3","block_type":"box","text":"sub-advisers are made independently of each other in light of differing conditions. BlackRock allocates","page_number":249,"box":{"x":116,"y":102,"width":765,"height":13}},{"id":"e96ebc0d-ed09-4d7e-8d3b-da9862d6af9f","block_type":"box","text":"investments among client accounts in a fair and equitable manner over time. A variety of factors will be","page_number":249,"box":{"x":117,"y":118,"width":767,"height":12}},{"id":"cc5f66a2-d5ae-403e-a5b0-4dd666998fc9","block_type":"box","text":"considered in making such allocations. These factors include: (i) investment objectives or strategies for","page_number":249,"box":{"x":116,"y":134,"width":769,"height":12}},{"id":"82cec89c-cfbd-4eb8-ac33-96b3d91e35f4","block_type":"box","text":"particular accounts, including sector, industry, country or region and capitalization weightings, (ii) tax","page_number":249,"box":{"x":117,"y":149,"width":749,"height":12}},{"id":"edafc7cc-e54c-4b75-ac56-569c7bc4deca","block_type":"box","text":"considerations of an account, (iii) risk or investment concentration parameters for an account,","page_number":249,"box":{"x":116,"y":165,"width":699,"height":12}},{"id":"0536d836-af5e-4a4a-b561-821d7a347c49","block_type":"box","text":"(iv) supply or demand for a security at a given price level, (v) size of available investment, (vi) cash","page_number":249,"box":{"x":117,"y":180,"width":737,"height":12}},{"id":"d9fe13e5-bcd1-4085-a0db-fb5d92d65aaa","block_type":"box","text":"availability and liquidity requirements for accounts, (vii) regulatory restrictions, (viii) minimum","page_number":249,"box":{"x":116,"y":196,"width":690,"height":12}},{"id":"65e1ac6b-f36c-4917-90c7-14fc5a6431b1","block_type":"box","text":"investment size of an account, (ix) relative size of account, and (x) such other factors as may be","page_number":249,"box":{"x":117,"y":211,"width":717,"height":12}},{"id":"01755144-62cc-4c0c-9875-5b7a95c112b4","block_type":"box","text":"approved by BlackRock’s general counsel. Moreover, investments may not be allocated to one client","page_number":249,"box":{"x":116,"y":227,"width":752,"height":12}},{"id":"e261daa0-b572-4502-a939-3f50db7b7749","block_type":"box","text":"account over another based on any of the following considerations: (i) to favor one client account at the","page_number":249,"box":{"x":116,"y":242,"width":771,"height":12}},{"id":"b9087b31-6e97-4038-b355-92ecbd6cfe31","block_type":"box","text":"expense of another, (ii) to generate higher fees paid by one client account over another or to produce","page_number":249,"box":{"x":116,"y":258,"width":757,"height":12}},{"id":"5756bdd2-c4f8-4321-b581-f76510ffbba0","block_type":"box","text":"greater performance compensation to BlackRock, (iii) to develop or enhance a relationship with a client","page_number":249,"box":{"x":116,"y":273,"width":770,"height":12}},{"id":"f607c6fb-ec4a-4925-aaf0-5a9025c4bde9","block_type":"box","text":"or prospective client, (iv) to compensate a client for past services or benefits rendered to BlackRock or","page_number":249,"box":{"x":116,"y":289,"width":765,"height":12}},{"id":"d99f66d5-3bb6-4657-b1ee-1d7db05a86b9","block_type":"box","text":"to induce future services or benefits to be rendered to BlackRock, or (v) to manage or equalize","page_number":249,"box":{"x":116,"y":304,"width":707,"height":12}},{"id":"8e19088e-4960-483f-8d4a-e966b6ff16d6","block_type":"box","text":"investment performance among different client accounts.","page_number":249,"box":{"x":117,"y":320,"width":426,"height":12}},{"id":"aae830b2-adcf-42f6-b9ac-f0e4ae14c34c","block_type":"box","text":"Equity securities will generally be allocated among client accounts within the same investment","page_number":249,"box":{"x":117,"y":351,"width":702,"height":12}},{"id":"558cf8fb-7aa4-430c-be87-4ef92fe8c547","block_type":"box","text":"mandate on a pro rata basis. All allocations of equity securities will be subject, where relevant, to share","page_number":249,"box":{"x":117,"y":366,"width":769,"height":12}},{"id":"3ec30c20-a5ab-4a43-9c2e-7c9d032b1bc5","block_type":"box","text":"minimums established for accounts and compliance constraints.","page_number":249,"box":{"x":117,"y":382,"width":479,"height":12}},{"id":"68446273-f15d-4bf7-a217-ee82a5c6f0b2","block_type":"box","text":"Initial public offerings of securities may be over-subscribed and subsequently trade at a premium in the","page_number":249,"box":{"x":117,"y":413,"width":768,"height":12}},{"id":"c103ffba-0ce4-4e26-8f64-faf6657141c8","block_type":"box","text":"secondary market. In these situations, the supply of securities available for client accounts is often less","page_number":249,"box":{"x":116,"y":428,"width":769,"height":12}},{"id":"29f51bc1-b891-4de8-af7c-a65e196bc415","block_type":"box","text":"than the amount of securities the accounts would otherwise take. In order to allocate these investments","page_number":249,"box":{"x":116,"y":444,"width":772,"height":9}},{"id":"bd23baff-880e-46c1-a5f7-e71c551ce61e","block_type":"box","text":"fairly and equitably among client accounts over time, each portfolio manager or a member of his or her","page_number":249,"box":{"x":116,"y":459,"width":766,"height":12}},{"id":"938c8b55-746e-4764-8637-3fefde28a43e","block_type":"box","text":"respective investment team will indicate to BlackRock’s trading desk their level of interest in a","page_number":249,"box":{"x":117,"y":475,"width":697,"height":12}},{"id":"473b4dea-5312-4f1a-9ce8-a5ccb3eabf2f","block_type":"box","text":"particular offering with respect to eligible client accounts for which that team is responsible. Initial","page_number":249,"box":{"x":117,"y":490,"width":723,"height":12}},{"id":"20c4a4d1-79bf-4b99-9828-809c74788db8","block_type":"box","text":"public offerings of U.S. equity securities will be identified as eligible for particular client accounts that","page_number":249,"box":{"x":117,"y":506,"width":748,"height":12}},{"id":"9ec921ec-0027-4c9f-94fe-07c4def70b67","block_type":"box","text":"are managed by portfolio teams who have indicated interest in the offering based on market","page_number":249,"box":{"x":116,"y":521,"width":687,"height":12}},{"id":"885abe08-7d8e-49ce-bd16-f6b5402b9fbc","block_type":"box","text":"capitalization of the issuer of the security and the investment mandate of the client account and in the","page_number":249,"box":{"x":116,"y":537,"width":758,"height":12}},{"id":"a9f567bb-9eb9-4738-9f9d-df05ace12e33","block_type":"box","text":"case of international equity securities, the country where the offering is taking place and the investment","page_number":249,"box":{"x":116,"y":552,"width":771,"height":12}},{"id":"b40553d8-3b16-457e-b388-5b51f816a793","block_type":"box","text":"mandate of the client account. Generally, shares received during the initial public offering will be","page_number":249,"box":{"x":117,"y":568,"width":716,"height":12}},{"id":"df16e08f-8708-4566-812e-96ad2b7fb4db","block_type":"box","text":"allocated among participating client accounts within each investment mandate on a pro rata basis. In","page_number":249,"box":{"x":116,"y":583,"width":752,"height":12}},{"id":"bebe555a-c2a7-4d5e-a701-615777264779","block_type":"box","text":"situations where supply is too limited to be allocated among all accounts for which the investment is","page_number":249,"box":{"x":116,"y":599,"width":744,"height":12}},{"id":"68bac4f8-1659-436c-80d5-a0ae18efff82","block_type":"box","text":"eligible, portfolio managers may rotate such investment opportunities among one or more accounts so","page_number":249,"box":{"x":116,"y":614,"width":763,"height":12}},{"id":"32b67098-0004-4667-a3b7-7f7778547971","block_type":"box","text":"long as the rotation system provides for fair access for all client accounts over time. Other allocation","page_number":249,"box":{"x":117,"y":630,"width":746,"height":12}},{"id":"b80be1b6-a05e-4cff-a4a3-d5726b82be24","block_type":"box","text":"methodologies that are considered by BlackRock to be fair and equitable to clients may be used as","page_number":249,"box":{"x":117,"y":645,"width":739,"height":12}},{"id":"bc08a1dd-ed74-41b2-a1ef-ef4552de07dd","block_type":"box","text":"well.","page_number":249,"box":{"x":116,"y":661,"width":32,"height":9}},{"id":"f95adfcf-9354-488a-aaa3-53537e8c42be","block_type":"box","text":"Because different accounts may have differing investment objectives and policies, BlackRock may buy","page_number":249,"box":{"x":117,"y":692,"width":760,"height":12}},{"id":"4bbab558-e176-4a27-a1dc-d5f91bcb004f","block_type":"box","text":"and sell the same securities at the same time for different clients based on the particular investment","page_number":249,"box":{"x":116,"y":707,"width":741,"height":12}},{"id":"d4cf2d08-dd9b-4eae-bfb1-7260c573c0db","block_type":"box","text":"objective, guidelines and strategies of those accounts. For example, BlackRock may decide that it may","page_number":249,"box":{"x":116,"y":723,"width":763,"height":12}},{"id":"a4cb4b51-64ff-4321-8d13-92dfb2d7e6d3","block_type":"box","text":"be entirely appropriate for a growth fund to sell a security at the same time a value fund is buying that","page_number":249,"box":{"x":117,"y":738,"width":752,"height":12}},{"id":"e8801615-c43c-4397-b572-1716de835df8","block_type":"box","text":"security. To the extent that transactions on behalf of more than one client of BlackRock or its affiliates","page_number":249,"box":{"x":116,"y":754,"width":754,"height":12}},{"id":"ed9e225e-f215-414f-9349-65e0f2ad92ca","block_type":"box","text":"during the same period may increase the demand for securities being purchased or the supply of","page_number":249,"box":{"x":116,"y":769,"width":720,"height":12}},{"id":"2d4740ec-87a8-470e-90ae-6140d54b9206","block_type":"box","text":"securities being sold, there may be an adverse effect on price. For example, sales of a security by","page_number":249,"box":{"x":116,"y":785,"width":728,"height":12}},{"id":"38dd3583-db06-40cf-a0c8-f623c3f14bd6","block_type":"box","text":"BlackRock on behalf of one or more of its clients may decrease the market price of such security,","page_number":249,"box":{"x":117,"y":800,"width":720,"height":12}},{"id":"8df51008-95a1-4337-bf8c-4c7015797cfc","block_type":"box","text":"adversely impacting other BlackRock clients that still hold the security. If purchases or sales of","page_number":249,"box":{"x":116,"y":816,"width":701,"height":12}},{"id":"ec1d9cfb-8d2b-4202-9459-c9cc391269f5","block_type":"box","text":"securities arise for consideration at or about the same time that would involve a Fund or other clients or","page_number":249,"box":{"x":116,"y":831,"width":772,"height":10}},{"id":"4935da07-41d3-4a0f-bff7-ae8204dc7173","block_type":"box","text":"funds for which BlackRock or an affiliate act as investment manager, transactions in such securities will","page_number":249,"box":{"x":116,"y":847,"width":772,"height":12}},{"id":"00ccf8e6-bdd0-43cd-bf45-7ab555e9a957","block_type":"box","text":"be made, insofar as feasible, for the respective funds and clients in a manner deemed equitable to all.","page_number":249,"box":{"x":117,"y":862,"width":760,"height":12}},{"id":"f8ab8f15-353d-4be7-9287-7028ac79e4ae","block_type":"box","text":"II-162","page_number":249,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"fd9311e5-f664-4a53-ba4d-1d1aa2577f8e","block_type":"box","text":"NM1026U-6004382-249/605","page_number":249,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"27d09d96-58e1-4c0d-8a8a-cc984649a911","block_type":"box","text":"In certain instances, BlackRock may find it efficient for purposes of seeking to obtain best execution, to","page_number":250,"box":{"x":117,"y":87,"width":767,"height":12}},{"id":"1ebda95d-8682-42ff-bce3-770d47f7724c","block_type":"box","text":"aggregate certain contemporaneous purchases or sale orders of its advisory accounts. In general, all","page_number":250,"box":{"x":116,"y":102,"width":755,"height":13}},{"id":"4bd5201a-2614-4e87-99f0-22d9480f90d7","block_type":"box","text":"contemporaneous trades for client accounts under management by the same portfolio manager or","page_number":250,"box":{"x":116,"y":118,"width":733,"height":12}},{"id":"d74ddbe5-406e-4517-a8d7-d1cb337c7dc6","block_type":"box","text":"investment team will be aggregated in a single order if the trader believes the aggregated trade would","page_number":250,"box":{"x":117,"y":134,"width":758,"height":12}},{"id":"e4abca34-1aa3-41f5-9040-e0e5c3829f2e","block_type":"box","text":"provide each client with an opportunity to achieve a more favorable execution at a potentially lower","page_number":250,"box":{"x":117,"y":149,"width":737,"height":12}},{"id":"744154ca-9594-4412-a919-4e26aa9de66d","block_type":"box","text":"execution cost. The costs associated with an aggregated order will be shared pro rata among the","page_number":250,"box":{"x":116,"y":165,"width":726,"height":12}},{"id":"fae880e3-06b2-4b38-87fd-6814b1b66fbb","block_type":"box","text":"clients in the aggregated order. Generally, if an order for a particular portfolio manager or management","page_number":250,"box":{"x":116,"y":180,"width":769,"height":12}},{"id":"c0195717-861c-4e15-86d6-317ce9017646","block_type":"box","text":"team is filled at several different prices through multiple trades, all accounts participating in the order","page_number":250,"box":{"x":116,"y":196,"width":750,"height":12}},{"id":"95d66b52-08f5-401b-96f6-1e6485cc31c6","block_type":"box","text":"will receive the average price except in the case of certain international markets where average pricing","page_number":250,"box":{"x":116,"y":211,"width":767,"height":12}},{"id":"299f3dfd-38a4-46e5-a690-5fe2e0ef32e4","block_type":"box","text":"is not permitted. While in some cases this practice could have a detrimental effect upon the price or","page_number":250,"box":{"x":117,"y":227,"width":742,"height":11}},{"id":"22c04ddf-6ff4-4a70-a6b6-9978702aedb7","block_type":"box","text":"value of the security as far as a Fund is concerned, in other cases it could be beneficial to the Fund.","page_number":250,"box":{"x":116,"y":242,"width":747,"height":12}},{"id":"1c9cf97f-37ce-47e8-b892-881e2ba334aa","block_type":"box","text":"Transactions effected by BlackRock on behalf of more than one of its clients during the same period","page_number":250,"box":{"x":116,"y":258,"width":747,"height":12}},{"id":"cb762290-2d6b-4658-aada-45f3936b03f8","block_type":"box","text":"may increase the demand for securities being purchased or the supply of securities being sold, causing","page_number":250,"box":{"x":117,"y":273,"width":771,"height":12}},{"id":"0a533734-cfd7-4239-b7e8-a6b358e20eab","block_type":"box","text":"an adverse effect on price. The trader will give the aggregated order to the broker-dealer that the trader","page_number":250,"box":{"x":116,"y":289,"width":772,"height":12}},{"id":"41cd0a6b-1b97-4344-bb53-e7fe87efaea2","block_type":"box","text":"has identified as being able to provide the best execution of the order. 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BlackRock may, from","page_number":250,"box":{"x":117,"y":599,"width":754,"height":12}},{"id":"8e03dafa-cfbe-47a5-8df6-b6f8a5ec69d6","block_type":"box","text":"time to time, effect trades on behalf of and for the","page_number":250,"box":{"x":116,"y":614,"width":372,"height":11}},{"id":"330c42f8-6da3-4816-ad02-8210349cbd38","block_type":"box","text":"account of a Fund with brokers or dealers that are","page_number":250,"box":{"x":488,"y":614,"width":376,"height":10}},{"id":"d4abb2dd-e6d7-4ce2-83a8-c86b2f46b4ad","block_type":"box","text":"affiliated with BFA, in conformity with the Investment Company Act and Commission rules and","page_number":250,"box":{"x":116,"y":630,"width":703,"height":12}},{"id":"0c0687fa-ccc1-4aa6-acc8-4dc5ec7eb98d","block_type":"box","text":"regulations. 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A Fund will not deal with affiliates in principal transactions unless permitted by applicable","page_number":250,"box":{"x":116,"y":676,"width":759,"height":12}},{"id":"019b7c0a-eb69-4710-a861-9299ba7ffba1","block_type":"box","text":"Commission rules or regulations, or by Commission exemptive order.","page_number":250,"box":{"x":117,"y":692,"width":512,"height":12}},{"id":"f5a367b5-073a-4d3c-8a79-5f320ca99c4f","block_type":"box","text":"Portfolio Turnover","page_number":250,"box":{"x":117,"y":723,"width":146,"height":9}},{"id":"7d12802a-7f73-4040-872f-fcafbdfbdfb6","block_type":"box","text":"The portfolio turnover rate is calculated by dividing the lesser of a Fund’s annual sales or purchases of","page_number":250,"box":{"x":116,"y":746,"width":761,"height":12}},{"id":"d01a5d52-72fc-4288-b16c-3822e2c4817e","block_type":"box","text":"portfolio securities (exclusive of purchases or sales of U.S. Government Securities and all other","page_number":250,"box":{"x":117,"y":761,"width":708,"height":13}},{"id":"95b78ef5-673e-4b64-87e0-b557f9683238","block_type":"box","text":"securities whose maturities at the time of acquisition were one year or less) by the monthly average","page_number":250,"box":{"x":116,"y":777,"width":738,"height":12}},{"id":"f53c8c60-160c-4316-928e-26cf91dbfc05","block_type":"box","text":"value of the securities in the portfolio during the year. A high rate of portfolio turnover results in certain","page_number":250,"box":{"x":116,"y":792,"width":757,"height":13}},{"id":"6bda717c-ec00-49c5-9916-ecf718220158","block_type":"box","text":"tax consequences, such as increased capital gain dividends and/or ordinary income dividends, and in","page_number":250,"box":{"x":116,"y":808,"width":752,"height":12}},{"id":"ee0ca6a9-42e0-4901-96d6-5dcf5c148b60","block_type":"box","text":"correspondingly greater transaction costs in the form of dealer spreads and brokerage commissions,","page_number":250,"box":{"x":116,"y":823,"width":745,"height":13}},{"id":"78eac212-9bd7-485d-8c7c-20ed72971187","block_type":"box","text":"which are borne directly by a Fund.","page_number":250,"box":{"x":116,"y":839,"width":266,"height":12}},{"id":"7f8cd850-d31c-48b8-b6e3-7e78c2325649","block_type":"box","text":"II-163","page_number":250,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"45b91c1b-57fc-4d81-8051-1911b6373437","block_type":"box","text":"NM1026U-6004382-250/605","page_number":250,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"93900343-d7f0-4fd2-b993-938d6f975702","block_type":"box","text":"D","page_number":251,"box":{"x":419,"y":87,"width":10,"height":9}},{"id":"34696cee-285d-408a-9300-3c323712cb88","block_type":"box","text":"IVIDENDS","page_number":251,"box":{"x":431,"y":89,"width":63,"height":8}},{"id":"8584e48e-3722-411c-a03f-2ec2730a9c98","block_type":"box","text":"AND","page_number":251,"box":{"x":499,"y":89,"width":29,"height":7}},{"id":"4a466ac1-4c5a-4260-96dc-376cf9506531","block_type":"box","text":"T","page_number":251,"box":{"x":529,"y":87,"width":14,"height":9}},{"id":"6bfc6fef-b663-4c25-bac4-f608e099868c","block_type":"box","text":"AXES","page_number":251,"box":{"x":544,"y":89,"width":36,"height":8}},{"id":"6fde7027-8db1-43a2-9335-0e905b8c878b","block_type":"box","text":"Dividends","page_number":251,"box":{"x":117,"y":118,"width":84,"height":10}},{"id":"69000f34-c598-4974-a143-32cbd7fac350","block_type":"box","text":"Each Fund intends to distribute substantially all of its net investment income, if any. Dividends from","page_number":251,"box":{"x":117,"y":141,"width":739,"height":12}},{"id":"e367b3c1-11f1-4097-9449-744ba5ad763c","block_type":"box","text":"such net investment income are paid as set forth in each Fund’s Prospectus. Each Fund also intends","page_number":251,"box":{"x":116,"y":157,"width":755,"height":12}},{"id":"f926e260-5a7d-4f94-840b-236f5567639a","block_type":"box","text":"to distribute all net realized capital gains, if any, as set forth in such Fund’s Prospectus. From time to","page_number":251,"box":{"x":116,"y":172,"width":751,"height":12}},{"id":"796539d4-865b-4288-ad6a-2c57178938af","block_type":"box","text":"time, a Fund may declare a special distribution at or about the end of the calendar year in order to","page_number":251,"box":{"x":116,"y":188,"width":732,"height":12}},{"id":"ac936d5d-8e10-45d9-a095-bdd835f11295","block_type":"box","text":"comply with U.S. federal tax requirements that certain percentages of its ordinary income and capital","page_number":251,"box":{"x":116,"y":203,"width":752,"height":12}},{"id":"4713a665-d717-4484-9342-a338a5741f7c","block_type":"box","text":"gains be distributed during the year. If, in any fiscal year, a Fund has net income from certain foreign","page_number":251,"box":{"x":116,"y":219,"width":751,"height":12}},{"id":"7b7cfba5-bac5-4594-9d25-2ee47424c0e5","block_type":"box","text":"currency transactions, such income will be distributed at least annually.","page_number":251,"box":{"x":116,"y":234,"width":533,"height":12}},{"id":"ee033ee9-4520-4fe6-8d40-ca882e7dc34a","block_type":"box","text":"For information concerning the manner in which dividends may be reinvested automatically in shares","page_number":251,"box":{"x":117,"y":265,"width":753,"height":12}},{"id":"4939dbb1-64c9-47e3-b54a-411ba65223ef","block_type":"box","text":"of each Fund, as applicable, see “Shareholder Services — Automatic Dividend Reinvestment Plan.”","page_number":251,"box":{"x":116,"y":281,"width":745,"height":12}},{"id":"82a44402-dc88-41dd-93df-fffb40170b87","block_type":"box","text":"Shareholders may also elect in writing to receive any such dividends in cash. Dividends are taxable to","page_number":251,"box":{"x":116,"y":296,"width":761,"height":12}},{"id":"3d0466a5-69c3-4c98-b231-80581c259756","block_type":"box","text":"shareholders, as discussed below, whether they are reinvested in shares of the Fund or received in","page_number":251,"box":{"x":116,"y":312,"width":743,"height":12}},{"id":"63a7abb5-f36a-4fd6-8387-dbf1d63c81b7","block_type":"box","text":"cash. The per share dividends on front-end load shares, CDSC shares and Service Shares will be","page_number":251,"box":{"x":116,"y":327,"width":732,"height":12}},{"id":"a93bf1df-7b72-4ca2-a782-5ebf46b432d7","block_type":"box","text":"lower than the per share dividends on Institutional Shares as a result of the service, distribution and","page_number":251,"box":{"x":117,"y":343,"width":743,"height":12}},{"id":"42b7225c-d3e2-445c-ab4c-9c55df8a460a","block_type":"box","text":"higher transfer agency fees applicable to CDSC shares, the service fees applicable to front-end load","page_number":251,"box":{"x":117,"y":358,"width":749,"height":12}},{"id":"04007ddb-6561-45fd-ba92-8f1fb6b86ccc","block_type":"box","text":"shares and Service Shares, and the service and distribution fees applicable to Class R Shares.","page_number":251,"box":{"x":116,"y":374,"width":711,"height":12}},{"id":"868c79f1-515e-4592-810b-5cedb0804667","block_type":"box","text":"Similarly, the per share dividends on CDSC shares and Class R Shares will be lower than the per","page_number":251,"box":{"x":116,"y":389,"width":728,"height":12}},{"id":"b22124d7-518a-430d-93f4-b12c61cba3d0","block_type":"box","text":"share dividends on front-end load shares and Service Shares as a result of the distribution fees and","page_number":251,"box":{"x":116,"y":405,"width":745,"height":9}},{"id":"241457f1-c5af-44bd-9a6e-79c094be32c0","block_type":"box","text":"higher transfer agency fees applicable to CDSC shares and the distribution fees applicable to Class R","page_number":251,"box":{"x":117,"y":420,"width":760,"height":12}},{"id":"fc6cc2b3-3a64-4954-a7fe-3a398d570573","block_type":"box","text":"Shares, and the per share dividends on CDSC shares will be lower than the per share dividends on","page_number":251,"box":{"x":116,"y":436,"width":742,"height":12}},{"id":"f36f3708-5bba-4943-8b64-9544022d5a68","block_type":"box","text":"Class R Shares as a result of the higher distribution fees and higher transfer agency fees applicable to","page_number":251,"box":{"x":117,"y":451,"width":764,"height":12}},{"id":"ff1a05a2-94f0-404b-894a-dcc72c0b76b6","block_type":"box","text":"CDSC shares.","page_number":251,"box":{"x":117,"y":467,"width":111,"height":9}},{"id":"457e541f-21a6-4c56-b56e-406bbcbf91e6","block_type":"box","text":"Taxes","page_number":251,"box":{"x":116,"y":498,"width":52,"height":9}},{"id":"acb317b1-fd01-4452-ac10-e11ecb45d73f","block_type":"box","text":"Each Fund intends to continue to qualify for the special tax treatment afforded to regulated investment","page_number":251,"box":{"x":117,"y":521,"width":761,"height":12}},{"id":"9c53e06b-475f-41ee-8a50-9da87f1c7c8e","block_type":"box","text":"companies under the Code. As long as a Fund so qualifies, the Fund (but not its shareholders) will not","page_number":251,"box":{"x":116,"y":537,"width":763,"height":12}},{"id":"a93c662e-97bc-4e34-9645-42ec2dde8c0b","block_type":"box","text":"be subject to U.S. federal income tax on the part of its investment company taxable income and net","page_number":251,"box":{"x":117,"y":552,"width":742,"height":12}},{"id":"8cb396ea-0d10-4604-9aad-8dfe40f009da","block_type":"box","text":"realized capital gains that it distributes to its shareholders in years in which it distributes at least 90% of","page_number":251,"box":{"x":117,"y":568,"width":770,"height":12}},{"id":"e773635b-c773-4856-9e59-bf74dbbbd27d","block_type":"box","text":"its investment company taxable income and at least 90% of its net tax-exempt interest income, if any,","page_number":251,"box":{"x":117,"y":583,"width":757,"height":12}},{"id":"be73e742-66a7-4704-a694-5ddb0088b498","block_type":"box","text":"for the year. To qualify as a regulated investment company, a Fund must meet certain requirements","page_number":251,"box":{"x":116,"y":599,"width":746,"height":12}},{"id":"a474f2fb-16dd-4a4b-a35c-5a02869854d2","block_type":"box","text":"regarding the source of its income and the composition and diversification of its assets. See Part II,","page_number":251,"box":{"x":117,"y":614,"width":739,"height":12}},{"id":"c37d8a8c-6d5c-4b6b-8632-80387da28bf7","block_type":"box","text":"“Investment Risks and Considerations — Investment Restrictions (All Funds)” for a discussion of the","page_number":251,"box":{"x":116,"y":630,"width":749,"height":12}},{"id":"6bb9ec88-8145-4243-82d2-f679ea6b9626","block_type":"box","text":"asset diversification requirements. In the case of a Feeder Fund, such Fund may look to the underlying","page_number":251,"box":{"x":116,"y":645,"width":769,"height":12}},{"id":"d345d84a-c9cc-4349-8e08-a33122bde716","block_type":"box","text":"assets of the Master Portfolio in which it has invested for purposes of satisfying the asset diversification","page_number":251,"box":{"x":116,"y":661,"width":766,"height":12}},{"id":"0878940d-0d47-420d-b7fc-cd4bb6abcdba","block_type":"box","text":"requirement and various other requirements of the Code applicable to regulated investment","page_number":251,"box":{"x":117,"y":676,"width":678,"height":12}},{"id":"81b84489-0450-47f4-ac50-47fcc7e68e43","block_type":"box","text":"companies.","page_number":251,"box":{"x":116,"y":692,"width":84,"height":12}},{"id":"783b7b9e-ddcc-4141-a025-d3e916b68c9d","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","page_number":251,"box":{"x":116,"y":723,"width":737,"height":12}},{"id":"c1a25fc3-28d9-4405-8596-f4b22a03254c","block_type":"box","text":"above or a failure to diversify its holdings in the manner described above by paying a tax, by disposing","page_number":251,"box":{"x":116,"y":738,"width":759,"height":12}},{"id":"c2e3463c-1e3a-4ebd-bb89-f596176e4833","block_type":"box","text":"of certain assets, or by paying a tax and disposing of","page_number":251,"box":{"x":116,"y":754,"width":392,"height":12}},{"id":"7ef526fc-2c86-4dfb-a39b-9e4ab78547a6","block_type":"box","text":"assets. If, in any taxable year, a Fund fails one of","page_number":251,"box":{"x":513,"y":754,"width":366,"height":12}},{"id":"d0413539-702d-45f0-b4d5-ec353993a70b","block_type":"box","text":"these tests and does not timely cure the failure, the Fund will be taxed in the same manner as an","page_number":251,"box":{"x":116,"y":769,"width":719,"height":12}},{"id":"42677a56-7250-40c2-9405-794791172007","block_type":"box","text":"ordinary corporation and distributions to its shareholders will not be deductible by the Fund in","page_number":251,"box":{"x":116,"y":785,"width":690,"height":12}},{"id":"86355dce-82c8-441c-b55b-1c0788c1922e","block_type":"box","text":"computing its taxable income. Although in general the passive loss rules of the Code do not apply to","page_number":251,"box":{"x":116,"y":800,"width":743,"height":12}},{"id":"a354d9dd-83b4-4974-a4e7-aa63ea0b61f4","block_type":"box","text":"regulated investment companies, such rules do apply to a regulated investment company with respect","page_number":251,"box":{"x":117,"y":816,"width":756,"height":12}},{"id":"67a25958-754e-42c2-9e57-f5b7e0f5b294","block_type":"box","text":"to items attributable to an interest in a qualified publicly-traded partnership. A Fund’s investments in","page_number":251,"box":{"x":116,"y":831,"width":744,"height":12}},{"id":"dd758b05-1a3b-441c-9d8f-6372297c3de0","block_type":"box","text":"partnerships, including in qualified publicly-traded partnerships, may result in the Fund being subject to","page_number":251,"box":{"x":117,"y":847,"width":767,"height":12}},{"id":"af40985a-1b9e-4f91-8ea6-a1b9c60ceb2b","block_type":"box","text":"state, local, or non-U.S. income, franchise or withholding tax liabilities.","page_number":251,"box":{"x":116,"y":862,"width":526,"height":12}},{"id":"cc4f5c00-5d2c-4662-bc47-42ead925bfc1","block_type":"box","text":"II-164","page_number":251,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"a4b060e6-88af-44f6-ad83-71ed8c798119","block_type":"box","text":"NM1026U-6004382-251/605","page_number":251,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"70a291dc-264c-405d-bee9-925835f0757f","block_type":"box","text":"Each Fund intends to distribute substantially all of such income and gains. If, in any taxable year, a","page_number":252,"box":{"x":117,"y":87,"width":738,"height":12}},{"id":"1f611f53-05b7-4269-a7cb-a00803005891","block_type":"box","text":"Fund fails to qualify as a regulated investment company under the Code, notwithstanding the","page_number":252,"box":{"x":117,"y":102,"width":694,"height":13}},{"id":"ca4e1423-8803-4bb1-a193-3660395544b6","block_type":"box","text":"availability of certain relief provisions, such Fund would be taxed in the same manner as an ordinary","page_number":252,"box":{"x":116,"y":118,"width":748,"height":12}},{"id":"12946830-29c7-40ae-bd91-1f6ac5f40998","block_type":"box","text":"corporation and all distributions from earnings and profits (as determined under U.S. federal income","page_number":252,"box":{"x":116,"y":134,"width":745,"height":12}},{"id":"806d1d52-9ab4-4309-b7c6-e8c78dd36e1e","block_type":"box","text":"tax principles) to its shareholders would be taxable as ordinary dividend income eligible for taxation at","page_number":252,"box":{"x":116,"y":149,"width":759,"height":12}},{"id":"08a9f9a5-08cd-4702-8101-d3c1d5f76160","block_type":"box","text":"a reduced tax rate for non-corporate shareholders and the dividends-received deduction for corporate","page_number":252,"box":{"x":116,"y":165,"width":760,"height":11}},{"id":"a5f01289-b713-44e9-919c-7ec66105766d","block_type":"box","text":"shareholders. However, a Municipal Fund’s distributions derived from income on tax-exempt","page_number":252,"box":{"x":116,"y":180,"width":690,"height":12}},{"id":"67ae6f8e-55d4-4591-9c4c-f5ad70c56c2d","block_type":"box","text":"obligations, as defined herein, would no longer qualify for treatment as exempt interest. Each Fund that","page_number":252,"box":{"x":116,"y":196,"width":771,"height":12}},{"id":"05d8f4f1-3465-4c96-aa77-46d284cd59a7","block_type":"box","text":"is a series of a regulated investment company that consists of multiple series is treated as a separate","page_number":252,"box":{"x":117,"y":211,"width":756,"height":12}},{"id":"651b52a9-5b02-40d7-af61-e051090a8abb","block_type":"box","text":"corporation for U.S. federal income tax purposes, and therefore is considered to be a separate entity in","page_number":252,"box":{"x":116,"y":227,"width":769,"height":12}},{"id":"2cee1382-8ff1-4c39-bc62-df2821053cf7","block_type":"box","text":"determining its treatment under the rules for regulated investment companies. Losses in one series of","page_number":252,"box":{"x":116,"y":242,"width":760,"height":12}},{"id":"36d3b4da-8cf3-4dd9-91b9-3993abe6753e","block_type":"box","text":"a regulated investment company do not offset gains in another, and the requirements (other than","page_number":252,"box":{"x":116,"y":258,"width":724,"height":12}},{"id":"f40775e7-742b-493e-8204-a147de6a295c","block_type":"box","text":"certain organizational requirements) for qualifying for regulated investment company status will be","page_number":252,"box":{"x":116,"y":273,"width":732,"height":12}},{"id":"e3052c65-9f1b-46b7-b9e1-0cbaf27eb5e0","block_type":"box","text":"determined at the level of the individual series. In the following discussion, the term “Fund” means","page_number":252,"box":{"x":116,"y":289,"width":731,"height":12}},{"id":"08d1e1fc-ddd6-45d7-8165-c5112b85535a","block_type":"box","text":"each individual series, if applicable.","page_number":252,"box":{"x":116,"y":304,"width":268,"height":12}},{"id":"c02202d0-9a1f-4919-8012-dec5ec3b5db3","block_type":"box","text":"The Code requires a regulated investment company to pay a nondeductible 4% excise tax to the extent","page_number":252,"box":{"x":116,"y":335,"width":772,"height":12}},{"id":"2ff28d87-0bcf-4128-897b-38d395c0b207","block_type":"box","text":"the regulated investment company does not distribute, during each calendar year, at least 98% of its","page_number":252,"box":{"x":116,"y":351,"width":750,"height":12}},{"id":"208b9a41-fb4c-4f5b-84a2-58f9203a7d09","block_type":"box","text":"ordinary income, determined on a calendar year basis, and at least 98.2% of its capital gain net","page_number":252,"box":{"x":116,"y":366,"width":713,"height":12}},{"id":"f2024f4c-74d5-496b-b57c-ec5ae9340032","block_type":"box","text":"income, determined, in general, as if the regulated investment company’s taxable year ended on","page_number":252,"box":{"x":117,"y":382,"width":720,"height":12}},{"id":"66f47223-7b5c-44be-9d2a-3e843a428da5","block_type":"box","text":"October 31, plus certain undistributed amounts from the previous years. While each Fund intends to","page_number":252,"box":{"x":116,"y":397,"width":747,"height":12}},{"id":"a3b989d6-f9d8-4d65-bd9f-337838ab5737","block_type":"box","text":"distribute its income and capital gains in the manner necessary to avoid imposition of the 4% excise","page_number":252,"box":{"x":116,"y":413,"width":745,"height":12}},{"id":"eb4bf5a6-c28a-4e62-bc37-0f1028be0d4c","block_type":"box","text":"tax, there can be no assurance that a sufficient amount of the Fund’s taxable income and capital gains","page_number":252,"box":{"x":116,"y":428,"width":765,"height":12}},{"id":"91150c69-e3fb-47a6-82cf-bfd214be3a8a","block_type":"box","text":"will be distributed to avoid entirely the imposition of the tax. In such event, a Fund will be liable for the","page_number":252,"box":{"x":116,"y":444,"width":758,"height":12}},{"id":"00e525a8-fcd7-4d44-820e-e7a8c3878fd8","block_type":"box","text":"tax only on the amount by which it does not meet the foregoing distribution requirements.","page_number":252,"box":{"x":116,"y":459,"width":666,"height":12}},{"id":"ab4d43aa-5ffb-4da5-9d31-bd7b63c7ad5b","block_type":"box","text":"Net capital loss carryforwards may be applied against realized capital gains in each succeeding year,","page_number":252,"box":{"x":117,"y":490,"width":754,"height":12}},{"id":"f8c10508-34c9-4ec4-a852-8a3a09a05293","block_type":"box","text":"until they have been reduced to zero. In the event that the Fund were to experience an ownership","page_number":252,"box":{"x":117,"y":506,"width":729,"height":12}},{"id":"dbaae512-b955-4873-8fe6-e4f29d8064b9","block_type":"box","text":"change as defined under the Code, the Fund’s loss carryforwards and other favorable tax attributes of","page_number":252,"box":{"x":116,"y":521,"width":761,"height":12}},{"id":"55ffbbf2-4d58-4dfc-917f-cefac964029b","block_type":"box","text":"the Fund, if any, may be subject to limitation.","page_number":252,"box":{"x":116,"y":537,"width":338,"height":12}},{"id":"4effd048-f5fa-445f-826d-ffd2cbd21c27","block_type":"box","text":"Dividends paid by a Fund from its ordinary income or from an excess of net short-term capital gain","page_number":252,"box":{"x":117,"y":568,"width":734,"height":12}},{"id":"0c190f91-47c8-473d-be4e-d73f48e98ad8","block_type":"box","text":"over net long-term capital loss (together referred to as “ordinary income dividends”) are taxable to","page_number":252,"box":{"x":116,"y":583,"width":730,"height":12}},{"id":"9595d208-94d4-4857-93cb-5cdf8702b9c8","block_type":"box","text":"shareholders as ordinary income. Distributions made from an excess of net long-term capital gain over","page_number":252,"box":{"x":116,"y":599,"width":766,"height":12}},{"id":"7ce4a710-84bf-4369-aac2-339ad4fd326d","block_type":"box","text":"net short-term capital loss (including gains or losses from certain transactions in futures and options)","page_number":252,"box":{"x":117,"y":614,"width":750,"height":12}},{"id":"2bcb0d37-d62a-49a2-bb24-f89594c0e3e3","block_type":"box","text":"(“capital gain dividends”) are taxable to shareholders as long-term capital gains, regardless of the","page_number":252,"box":{"x":117,"y":630,"width":727,"height":12}},{"id":"f187acf1-9c20-4f11-89d2-78ec92eae585","block_type":"box","text":"length of time the shareholder has owned Fund shares. Distributions paid by a Fund that are reported","page_number":252,"box":{"x":117,"y":645,"width":758,"height":12}},{"id":"d2aa1fe3-a638-4d05-9b97-1a237b447cf0","block_type":"box","text":"as exempt-interest dividends will not be subject to regular U.S. federal income tax. Certain dividend","page_number":252,"box":{"x":116,"y":661,"width":737,"height":12}},{"id":"ee59ab13-5d3a-4ca1-9ceb-8410daf23c63","block_type":"box","text":"income and long-term capital gains are eligible for taxation at a reduced rate that applies to","page_number":252,"box":{"x":117,"y":676,"width":675,"height":12}},{"id":"4d274ad5-9195-441b-91bc-5ac28511e1b4","block_type":"box","text":"non-corporate shareholders. Under these rules, the portion of ordinary income dividends constituting","page_number":252,"box":{"x":117,"y":692,"width":744,"height":12}},{"id":"4ee490d8-49a8-4315-8928-996852cb65ee","block_type":"box","text":"“qualified dividend income” when paid by a regulated investment company to a non-corporate","page_number":252,"box":{"x":116,"y":707,"width":693,"height":12}},{"id":"783b121b-3ae3-42fc-ac5d-a44d18974796","block_type":"box","text":"shareholder may be taxable to such shareholder at long-term capital gain rates provided the","page_number":252,"box":{"x":116,"y":723,"width":683,"height":12}},{"id":"3b5970e3-6a11-41e8-b738-aefb7284011f","block_type":"box","text":"shareholder has held the shares on which the dividend was paid for at least 61 days during the","page_number":252,"box":{"x":116,"y":738,"width":704,"height":12}},{"id":"50caa199-4bfa-4614-ae96-d7f599b4c7a8","block_type":"box","text":"121-day period that begins on the date that is 60 days before the date on which the shares become","page_number":252,"box":{"x":118,"y":754,"width":736,"height":12}},{"id":"973ef784-022e-4fa0-967a-a9ecd63aef55","block_type":"box","text":"ex-dividend with respect to such dividend (or, in the case of certain accumulated dividends with respect","page_number":252,"box":{"x":116,"y":769,"width":767,"height":12}},{"id":"9df811c2-4ff6-45f7-9ab0-1e4ce89fd6d4","block_type":"box","text":"to preferred stocks, the shareholder has held the shares on which the dividend was paid for at least","page_number":252,"box":{"x":116,"y":785,"width":738,"height":12}},{"id":"2e9bfd94-5bbd-4a16-bcc5-25d5649dae1c","block_type":"box","text":"91 days during the 181-day period that begins on the date that is 90 days before the date on which the","page_number":252,"box":{"x":116,"y":800,"width":761,"height":12}},{"id":"351d786f-b19f-4c5e-8668-d2191c2c546b","block_type":"box","text":"shares become ex-dividend with respect to such dividend). However, to the extent a Fund’s","page_number":252,"box":{"x":116,"y":816,"width":678,"height":12}},{"id":"2396cf68-f7cb-4593-9d4e-608a8583d835","block_type":"box","text":"distributions are derived from income on debt securities, certain types of preferred stock treated as","page_number":252,"box":{"x":116,"y":831,"width":737,"height":12}},{"id":"3ea5f081-025b-4c67-832d-e3bc8419f80f","block_type":"box","text":"debt for U.S. federal income tax purposes and short-term capital gains, such distributions will not","page_number":252,"box":{"x":116,"y":847,"width":723,"height":12}},{"id":"4ae6bdc1-04e2-4e7d-8b71-72ee999af4dd","block_type":"box","text":"constitute “qualified dividend income.” In addition, distributions that are derived from securities lending","page_number":252,"box":{"x":116,"y":862,"width":762,"height":12}},{"id":"3b408a1f-6baf-4d71-8699-28d97e975150","block_type":"box","text":"income, such as substitute dividend payments, will not constitute “qualified dividend income.”","page_number":252,"box":{"x":117,"y":878,"width":694,"height":12}},{"id":"5815755f-ed64-4843-86b3-1705aea39f27","block_type":"box","text":"II-165","page_number":252,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"2acb498a-52f2-41e1-ade2-a11ee9f6d6b4","block_type":"box","text":"NM1026U-6004382-252/605","page_number":252,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"702206e6-eb17-43c3-acdd-dc225d70b9b5","block_type":"box","text":"A 3.8% Medicare tax is imposed on the net investment income (which includes taxable dividends and","page_number":253,"box":{"x":116,"y":87,"width":757,"height":12}},{"id":"5f45330d-03e3-42c6-8286-2a28110cec7a","block_type":"box","text":"redemption proceeds) of certain individuals, trusts and estates.","page_number":253,"box":{"x":117,"y":102,"width":471,"height":13}},{"id":"a88c1e09-0020-407f-a2ed-c6697b28cc5d","block_type":"box","text":"A Fund’s net capital gain (the excess of net long-term capital gains over net short-term capital losses)","page_number":253,"box":{"x":116,"y":134,"width":759,"height":12}},{"id":"72944771-b3fa-4a0f-a3c6-1be9585b0849","block_type":"box","text":"is not subject to the 90% distribution requirement for taxation as a regulated investment company,","page_number":253,"box":{"x":117,"y":149,"width":731,"height":12}},{"id":"dc3f61a7-f65e-4489-985c-fe6048f34f03","block_type":"box","text":"described above. If a Fund retains net capital gain, it is subject to tax on that gain, and may designate","page_number":253,"box":{"x":116,"y":165,"width":760,"height":12}},{"id":"56723a0d-945f-4b8b-97f9-a89ab1180387","block_type":"box","text":"the retained amount as undistributed capital gain in a written statement furnished to its shareholders,","page_number":253,"box":{"x":116,"y":180,"width":753,"height":12}},{"id":"cbdf15b9-d22e-47af-bdfa-c5ddf1d5a25c","block_type":"box","text":"who will be required to include in income, as long-term capital gain, their proportionate shares of such","page_number":253,"box":{"x":116,"y":196,"width":759,"height":12}},{"id":"d2a5df52-a690-45e0-8bfc-1671cbba2fef","block_type":"box","text":"undistributed net capital gain, will be deemed to have paid and may claim as a credit against their U.S.","page_number":253,"box":{"x":117,"y":211,"width":765,"height":12}},{"id":"1894b82a-29c8-4c8b-8c27-daf73c651f2e","block_type":"box","text":"federal income tax liability (and as a refund to the extent it exceeds that liability) their proportionate","page_number":253,"box":{"x":116,"y":227,"width":737,"height":12}},{"id":"e52359c7-f1b2-481e-81fa-48d4cf13ad3f","block_type":"box","text":"shares of the tax paid by the Fund on that gain, and shall increase the tax basis of their shares in the","page_number":253,"box":{"x":116,"y":242,"width":753,"height":12}},{"id":"bc02a59f-0e01-40b8-975c-97433e4ca042","block_type":"box","text":"Fund by the excess of the amount included in income over the amount allowed as a credit against their","page_number":253,"box":{"x":117,"y":258,"width":768,"height":12}},{"id":"fb504e42-960a-484c-b8f1-e5f39d2f6653","block_type":"box","text":"taxes.","page_number":253,"box":{"x":116,"y":273,"width":49,"height":10}},{"id":"ba4a0181-a51b-452c-869e-1236aa0a563a","block_type":"box","text":"Distributions in excess of a Fund’s current and accumulated earnings and profits will first reduce the","page_number":253,"box":{"x":117,"y":304,"width":745,"height":12}},{"id":"d1b5acfc-c32c-4885-936e-74fcd0a043b9","block_type":"box","text":"adjusted tax basis of a holder’s shares and after such adjusted tax basis is reduced to zero, will","page_number":253,"box":{"x":116,"y":320,"width":713,"height":12}},{"id":"262ffe56-5b7e-4e32-91e4-12ca9b2767a9","block_type":"box","text":"constitute capital gains to such holder (assuming the shares are held as a capital asset). Distributions","page_number":253,"box":{"x":116,"y":335,"width":759,"height":12}},{"id":"13e68466-3a86-4045-9406-dac6d6060409","block_type":"box","text":"in excess of a Fund’s minimum distribution requirements (or taxable income) but not in excess of a","page_number":253,"box":{"x":117,"y":351,"width":736,"height":12}},{"id":"f321a116-e4a7-4639-8d7c-aa90eef1953f","block_type":"box","text":"Fund’s earnings and profits will be taxable to shareholders and will not constitute nontaxable returns of","page_number":253,"box":{"x":117,"y":366,"width":766,"height":12}},{"id":"b99dbb27-936d-4e3d-9c4e-f22c6b10a6f1","block_type":"box","text":"capital. In the case of a Fund with a non-calendar taxable year, a Fund’s earnings and profits are","page_number":253,"box":{"x":116,"y":382,"width":724,"height":12}},{"id":"783ebaf2-7490-4513-bb34-542b0ec0c67c","block_type":"box","text":"allocated first to distributions made on or before December 31 of the taxable year, and then to","page_number":253,"box":{"x":116,"y":397,"width":702,"height":12}},{"id":"4daa31f5-ea37-4e1a-8717-bdfc69fc5b7a","block_type":"box","text":"distributions made after December 31 of the taxable year. Any loss upon the sale or exchange of Fund","page_number":253,"box":{"x":116,"y":413,"width":766,"height":12}},{"id":"7d914a06-13d1-48bc-b83d-c72d735338e2","block_type":"box","text":"shares held for six months or less will be treated as long-term capital loss to the extent of any capital","page_number":253,"box":{"x":116,"y":428,"width":751,"height":12}},{"id":"29c1ab18-22ce-492c-bf4c-3dc07075bee8","block_type":"box","text":"gain dividends received by the shareholder.","page_number":253,"box":{"x":116,"y":444,"width":329,"height":12}},{"id":"c0b041b7-04ba-40ef-b910-9b8ae7469586","block_type":"box","text":"Ordinary income and capital gain dividends are taxable to shareholders even if they are reinvested in","page_number":253,"box":{"x":116,"y":475,"width":755,"height":12}},{"id":"27058b95-78b2-43b3-ba58-01f52b83acb0","block_type":"box","text":"additional shares of a Fund. Distributions by a Fund, whether from ordinary income or capital gains,","page_number":253,"box":{"x":116,"y":490,"width":744,"height":12}},{"id":"f1c18f48-c32a-49ca-a53e-c4284c86f515","block_type":"box","text":"generally will not be eligible for the dividends received deduction allowed to corporations under the","page_number":253,"box":{"x":116,"y":506,"width":736,"height":12}},{"id":"0326c778-6484-473f-95ee-04aee1e74de2","block_type":"box","text":"Code. If a Fund pays a dividend in January that was declared in the previous October, November or","page_number":253,"box":{"x":117,"y":521,"width":745,"height":12}},{"id":"507f3e10-e3ab-4f64-87ed-d4d0f0998f42","block_type":"box","text":"December to shareholders of record on a specified date in one of such months, then such dividend","page_number":253,"box":{"x":117,"y":537,"width":738,"height":12}},{"id":"94a51951-863b-4c42-a3d2-33910a00e6f3","block_type":"box","text":"will be treated for tax purposes as being paid by the Fund and received by its shareholders on","page_number":253,"box":{"x":116,"y":552,"width":702,"height":12}},{"id":"0bdf9c7c-79b6-4c3f-b0c4-31fa92f3afa9","block_type":"box","text":"December 31 of the year in which the dividend was declared. In the case of a Fund with a","page_number":253,"box":{"x":117,"y":568,"width":670,"height":12}},{"id":"608b741a-a2a2-4127-8139-ca41b2308eaf","block_type":"box","text":"non-calendar taxable year, if the Fund reports more capital gain dividends than it earns in such taxable","page_number":253,"box":{"x":117,"y":583,"width":767,"height":12}},{"id":"561fc3d2-61fb-4a4e-b8e0-ef9f5c1e2571","block_type":"box","text":"year, then the Fund will reduce the amounts reported as capital gains. Where possible, such reduction","page_number":253,"box":{"x":116,"y":599,"width":764,"height":12}},{"id":"9d7ec9b9-e155-45db-a930-4d76c50aada1","block_type":"box","text":"will first be allocated to dividends made after December 31 of such taxable year. A Fund may elect to","page_number":253,"box":{"x":116,"y":614,"width":755,"height":12}},{"id":"aed43ac2-5164-4e19-8324-752510287d67","block_type":"box","text":"defer recognizing, until the following taxable year, certain net capital losses arising after October 31 of","page_number":253,"box":{"x":116,"y":630,"width":761,"height":12}},{"id":"a1b7b9c0-054e-422a-9ed0-956746f3bec9","block_type":"box","text":"the current taxable year, and certain net ordinary losses arising after October 31 and/or December 31","page_number":253,"box":{"x":116,"y":645,"width":759,"height":12}},{"id":"28d4b353-8aa3-4938-8d62-b82f2b372faa","block_type":"box","text":"of the current taxable year. This may have the effect of increasing the amount of dividends otherwise","page_number":253,"box":{"x":116,"y":661,"width":748,"height":12}},{"id":"62670700-c786-497b-9c08-060317104c10","block_type":"box","text":"includible in the shareholder’s income with respect to the current taxable year.","page_number":253,"box":{"x":117,"y":676,"width":577,"height":12}},{"id":"ef0bdbb0-b992-4740-abc0-d51b9521bea5","block_type":"box","text":"No gain or loss will be recognized by Investor C shareholders on the conversion to Investor A Shares.","page_number":253,"box":{"x":117,"y":707,"width":753,"height":12}},{"id":"dd247599-6f0e-4c4c-ab6c-4b5b61123332","block_type":"box","text":"A shareholder’s tax basis in the Investor A Shares acquired upon conversion will be the same as the","page_number":253,"box":{"x":116,"y":723,"width":745,"height":12}},{"id":"a24bff63-cc9f-4a77-982e-4fac874dd0d9","block_type":"box","text":"shareholder’s tax basis in the converted Investor C Shares and the holding period of the acquired","page_number":253,"box":{"x":116,"y":738,"width":722,"height":12}},{"id":"d718267f-817d-400f-a6fe-22759b63ddf2","block_type":"box","text":"Investor A Shares will include the holding period for the converted Investor C Shares.","page_number":253,"box":{"x":117,"y":754,"width":631,"height":12}},{"id":"c20bc9d4-8f3e-486b-93e3-06503e870384","block_type":"box","text":"If a shareholder of a Fund exercises an exchange privilege within 90 days of acquiring the shares of a","page_number":253,"box":{"x":117,"y":785,"width":754,"height":12}},{"id":"cb36d723-5f05-48ba-8e09-f22f3033153a","block_type":"box","text":"Fund, but on or before January 31 of the following year, then the loss that the shareholder recognizes","page_number":253,"box":{"x":117,"y":800,"width":752,"height":12}},{"id":"2f4a52d8-8c8f-444d-80fe-d4561fb239d1","block_type":"box","text":"on the exchange will be reduced (or the gain increased) to the extent any sales charge paid on the","page_number":253,"box":{"x":116,"y":816,"width":731,"height":12}},{"id":"e12252e7-de33-4caa-ac1b-03913d36d55f","block_type":"box","text":"exchanged shares reduces any sales charge the shareholder would have owed upon the purchase of","page_number":253,"box":{"x":116,"y":831,"width":757,"height":12}},{"id":"02d3f240-380d-4174-81a6-a2f2411f7a63","block_type":"box","text":"the new shares in the absence of the exchange privilege. Instead, such sales charge will be treated as","page_number":253,"box":{"x":116,"y":847,"width":765,"height":12}},{"id":"38e0df88-8f03-4c58-943e-bece52abf5cd","block_type":"box","text":"an amount paid for the new shares.","page_number":253,"box":{"x":116,"y":862,"width":268,"height":12}},{"id":"0ee5781d-04c5-41cc-8ebd-1efe223e2eff","block_type":"box","text":"II-166","page_number":253,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"de0bc614-51c3-41dc-a5d2-71dc9fba0a39","block_type":"box","text":"NM1026U-6004382-253/605","page_number":253,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b90e314f-9f25-4998-9352-aeaca7e4189f","block_type":"box","text":"A loss realized on a sale or exchange of shares of a Fund will be disallowed if other substantially","page_number":254,"box":{"x":116,"y":87,"width":722,"height":12}},{"id":"e309d435-8c1d-4e1a-92c9-e71fbaa061d1","block_type":"box","text":"identical shares are acquired (whether through the automatic reinvestment of dividends or otherwise)","page_number":254,"box":{"x":117,"y":102,"width":754,"height":13}},{"id":"51eef861-1124-4f6a-944a-a0c153b6e916","block_type":"box","text":"within a 61-day period beginning 30 days before and ending 30 days after the date on which the","page_number":254,"box":{"x":116,"y":118,"width":717,"height":12}},{"id":"98fc3cf2-bc8f-4501-82dd-1dde5c8ccab2","block_type":"box","text":"shares are sold or exchanged. In such case, the basis of the shares acquired will be adjusted to reflect","page_number":254,"box":{"x":116,"y":134,"width":767,"height":12}},{"id":"8e175bc8-fa5d-4471-b4a7-99a7e8bcfdd7","block_type":"box","text":"the disallowed loss.","page_number":254,"box":{"x":116,"y":149,"width":150,"height":10}},{"id":"19f9c86e-1aa3-4a36-ae6f-37ccf42faa27","block_type":"box","text":"A Fund is also generally required by law to report to each shareholder and to the IRS cost basis","page_number":254,"box":{"x":116,"y":176,"width":716,"height":12}},{"id":"f5d24aea-8d3f-4651-9c61-74db4fbba6d6","block_type":"box","text":"information for shares of the Fund acquired on or after January 1, 2012, and sold or redeemed after","page_number":254,"box":{"x":117,"y":192,"width":744,"height":12}},{"id":"b21e2ff4-d0dd-4c77-b130-0cc81f2b1dcd","block_type":"box","text":"that date. This information includes the adjusted cost basis of the shares, the gross proceeds from","page_number":254,"box":{"x":116,"y":207,"width":734,"height":12}},{"id":"a408fd31-0af4-4021-b8dd-98f59bae1aa5","block_type":"box","text":"disposition, and whether the gain or loss is long-term or short-term. The adjusted cost basis of shares","page_number":254,"box":{"x":116,"y":223,"width":759,"height":12}},{"id":"65629132-3519-4b2c-838b-256f0a8f8c11","block_type":"box","text":"will be based on the default cost basis reporting method selected by the Fund, unless a shareholder,","page_number":254,"box":{"x":116,"y":238,"width":751,"height":12}},{"id":"e47827c6-fa32-4326-b8e4-2533f82ffd21","block_type":"box","text":"before the sale or redemption, informs the Fund that it has selected a different IRS-accepted method","page_number":254,"box":{"x":117,"y":254,"width":751,"height":12}},{"id":"bcb4d4df-786d-4ecc-be77-0f24ae671566","block_type":"box","text":"offered by the Fund. These requirements, however, will not apply for investments through an IRA or","page_number":254,"box":{"x":116,"y":269,"width":745,"height":12}},{"id":"d8491277-9175-499e-9cdd-426941b7b042","block_type":"box","text":"other tax-advantaged account. Shareholders should consult their tax advisors to determine the best","page_number":254,"box":{"x":116,"y":285,"width":744,"height":12}},{"id":"a5c619bb-b884-48a8-8a0e-0a8c2ce8b55a","block_type":"box","text":"cost basis method for their tax situation, and to obtain more information about how these new cost","page_number":254,"box":{"x":116,"y":300,"width":734,"height":11}},{"id":"17a84ecc-618e-47f6-97a7-b0a2e3da5a39","block_type":"box","text":"basis reporting requirements apply to them. For shares of a Fund acquired before January 1, 2012,","page_number":254,"box":{"x":117,"y":316,"width":740,"height":12}},{"id":"cf9f0471-c259-4f3d-b38b-b0868329fa9d","block_type":"box","text":"these new requirements will not apply, but the Fund will continue to report to the IRS the gross","page_number":254,"box":{"x":116,"y":331,"width":706,"height":12}},{"id":"c6689d65-83dc-49b3-83d9-b363f20188b7","block_type":"box","text":"proceeds received by a shareholder from the sale or redemption of such shares.","page_number":254,"box":{"x":117,"y":347,"width":600,"height":12}},{"id":"0ac65142-73d3-46d1-b0f1-3edf32e4bb40","block_type":"box","text":"Certain Funds may invest in derivative contracts such as options, futures contracts, forward contracts","page_number":254,"box":{"x":117,"y":374,"width":756,"height":12}},{"id":"1fd1a4d8-153d-44c0-8c6f-e002cbc84496","block_type":"box","text":"and swap agreements. The U.S. federal income tax treatment of a derivative contract may not be as","page_number":254,"box":{"x":116,"y":389,"width":749,"height":12}},{"id":"6c208204-392d-412c-afc7-73d4244c1121","block_type":"box","text":"favorable as a direct investment in the underlying security and may adversely affect the timing,","page_number":254,"box":{"x":116,"y":405,"width":707,"height":12}},{"id":"ac21dd45-236c-4f7a-91e3-1c75bd3e0ced","block_type":"box","text":"character and amount of income the Fund realizes from its investments. As a result, a larger portion of","page_number":254,"box":{"x":116,"y":420,"width":764,"height":12}},{"id":"31c70126-234c-41d4-a01a-5407cdcb15b9","block_type":"box","text":"the Fund’s distributions may be treated as ordinary income rather than capital gains. In addition,","page_number":254,"box":{"x":116,"y":436,"width":717,"height":12}},{"id":"b47bc357-f4e9-4359-a35a-8a4e0ae6f377","block_type":"box","text":"section 1256 contracts held by a Fund at the end of each taxable year (and, for purposes of the 4%","page_number":254,"box":{"x":116,"y":451,"width":742,"height":12}},{"id":"f05a2b4d-a02d-4628-a131-3ea1937e8b5e","block_type":"box","text":"excise tax, certain other dates as prescribed under the Code) are generally “marked-to-market,” such","page_number":254,"box":{"x":116,"y":467,"width":756,"height":12}},{"id":"d9072fcd-76fe-4385-a1dc-67b5dea940e2","block_type":"box","text":"that unrealized gains or losses are treated as though they were realized (with such gain or loss being","page_number":254,"box":{"x":116,"y":482,"width":755,"height":12}},{"id":"c4d5cc0c-956b-4d01-aac8-fa8c1a1c5bd6","block_type":"box","text":"considered 60% long-term and 40% short-term capital gain or loss), which may increase the amount","page_number":254,"box":{"x":116,"y":498,"width":749,"height":12}},{"id":"44df35a6-b98b-491c-bf38-f40d9fda8d4c","block_type":"box","text":"that must be distributed to meet distribution requirements and avoid the excise tax. In addition, the tax","page_number":254,"box":{"x":116,"y":514,"width":762,"height":11}},{"id":"b0b16f15-375b-4557-a08b-a2a749eab546","block_type":"box","text":"treatment of certain derivative contracts, such as swap agreements, is unsettled and may be subject to","page_number":254,"box":{"x":116,"y":529,"width":768,"height":12}},{"id":"ddf13c64-c1b5-48ce-8dfc-5ba320c641d1","block_type":"box","text":"future legislation, regulation or administrative pronouncements issued by the IRS. If such future","page_number":254,"box":{"x":116,"y":544,"width":712,"height":12}},{"id":"c2c78f80-30af-46e6-859e-682d8fa14575","block_type":"box","text":"guidance limits the Fund’s ability to use derivatives, the Fund may have to find other ways of achieving","page_number":254,"box":{"x":116,"y":560,"width":767,"height":12}},{"id":"903dd439-562c-484d-8306-69c68e301d17","block_type":"box","text":"its investment objectives.","page_number":254,"box":{"x":117,"y":576,"width":191,"height":11}},{"id":"3f4c2470-bdb9-47d0-a764-0c29e0a74ae3","block_type":"box","text":"Certain swap agreements, including exchange-traded swap agreements, are treated as notional","page_number":254,"box":{"x":117,"y":602,"width":716,"height":13}},{"id":"82d4b2cc-35cd-4864-83db-b5ba3f02350c","block_type":"box","text":"principal contracts rather than as section 1256 contracts. This can affect the type of income earned by","page_number":254,"box":{"x":117,"y":618,"width":762,"height":12}},{"id":"3b890ec2-2a50-445c-afcb-b645574b7dff","block_type":"box","text":"such swap agreements since all the income on a notional principal contract may be ordinary income,","page_number":254,"box":{"x":116,"y":634,"width":752,"height":12}},{"id":"db34dfae-7c2e-46f5-8788-76ac3b59076f","block_type":"box","text":"whereas 40% of the gain on a section 1256 contract is treated as short-term capital gain taxed at","page_number":254,"box":{"x":116,"y":649,"width":724,"height":12}},{"id":"db2bd501-0cf4-4106-94ad-2eb62d871030","block_type":"box","text":"ordinary rates and 60% is treated as long-term capital gain taxed at more favorable rates when","page_number":254,"box":{"x":116,"y":665,"width":703,"height":12}},{"id":"1f819909-999f-4af7-8145-2f06c68dd5de","block_type":"box","text":"distributed to shareholders. The rest is long-term capital gain, which may be taxable at more favorable","page_number":254,"box":{"x":116,"y":680,"width":758,"height":12}},{"id":"37e2611d-0aa5-4a55-aaa7-7895a5f8c710","block_type":"box","text":"rates than ordinary income. Proposed regulations interpret what types of swap agreements are to be","page_number":254,"box":{"x":117,"y":696,"width":745,"height":12}},{"id":"a7c36196-8e15-404e-ba2e-d0ce9bf360f0","block_type":"box","text":"treated as notional principal contracts rather than as section 1256 contracts. When finalized, these","page_number":254,"box":{"x":116,"y":711,"width":730,"height":12}},{"id":"73cae87f-d1d9-4258-8471-9a1d654489f1","block_type":"box","text":"regulations could result in the Fund having to treat more of its income on swap agreements and more","page_number":254,"box":{"x":117,"y":727,"width":751,"height":12}},{"id":"d24e0095-ef74-4a9f-93a2-ea4b2b35e4ca","block_type":"box","text":"of the distributions made to shareholders as ordinary income and less as long-term capital gains.","page_number":254,"box":{"x":116,"y":742,"width":718,"height":12}},{"id":"8350e3bb-9889-483b-90ef-c8d99dd8a1f1","block_type":"box","text":"Certain Funds may invest in zero coupon U.S. Treasury bonds and other debt securities that are","page_number":254,"box":{"x":117,"y":769,"width":714,"height":12}},{"id":"28a751ce-b511-4d7e-8782-40c08d1cb1e3","block_type":"box","text":"issued at a discount or provide for deferred interest. Even though a Fund receives no actual interest","page_number":254,"box":{"x":117,"y":785,"width":740,"height":12}},{"id":"4ad1edd0-1ae3-4304-9652-da2a11ee2413","block_type":"box","text":"payments on these securities, it will be deemed to receive income equal, generally, to a portion of the","page_number":254,"box":{"x":117,"y":800,"width":751,"height":12}},{"id":"c01552ae-98db-4e6b-9276-4862a987028a","block_type":"box","text":"excess of the stated redemption price of the securities over their issue price (“original issue discount”)","page_number":254,"box":{"x":116,"y":816,"width":754,"height":12}},{"id":"bced8710-0cad-4982-8b60-d406d4ac53b0","block_type":"box","text":"each year that the securities are held. Since the original issue discount income earned by a Fund in a","page_number":254,"box":{"x":116,"y":831,"width":757,"height":12}},{"id":"fb71b16e-607c-49fb-b966-48c82f29199c","block_type":"box","text":"taxable year may not be represented by cash income, the Fund may have to dispose of securities,","page_number":254,"box":{"x":116,"y":847,"width":734,"height":12}},{"id":"780b4db6-81fe-4c78-9af1-4e59d5b73190","block_type":"box","text":"which it might otherwise have continued to hold, or borrow to generate cash in order to satisfy its","page_number":254,"box":{"x":116,"y":862,"width":722,"height":12}},{"id":"6193d059-78dd-48d7-9a6e-899468b2592f","block_type":"box","text":"distribution requirements. In addition, a Fund’s investment in foreign currencies or foreign currency","page_number":254,"box":{"x":116,"y":878,"width":737,"height":12}},{"id":"9a543440-67ba-47e8-a1d7-f72ecb700a5f","block_type":"box","text":"II-167","page_number":254,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"19d7f445-cf05-48bc-9891-035332f702be","block_type":"box","text":"NM1026U-6004382-254/605","page_number":254,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"dc2323bf-bbd6-47ce-82af-a52b241d44ca","block_type":"box","text":"denominated or referenced debt securities, certain asset-backed securities and contingent payment","page_number":255,"box":{"x":116,"y":87,"width":744,"height":12}},{"id":"4065f22d-39c0-494a-a734-200d6ed3d3c4","block_type":"box","text":"and inflation-indexed debt instruments also may increase or accelerate the Fund’s recognition of","page_number":255,"box":{"x":116,"y":102,"width":720,"height":13}},{"id":"6f7c556a-1344-413c-85ef-9fdd2255247d","block_type":"box","text":"income, including the recognition of taxable income in excess of cash generated by such investments.","page_number":255,"box":{"x":117,"y":118,"width":761,"height":12}},{"id":"4a409563-9e64-42a4-a3b4-d384076469d5","block_type":"box","text":"Any transaction by the Fund in foreign currencies, foreign currency-denominated debt obligations or","page_number":255,"box":{"x":116,"y":134,"width":745,"height":12}},{"id":"7786d9b0-1a72-440d-8a5e-cacd5c8d37f7","block_type":"box","text":"certain foreign currency options, futures contracts or forward contracts (or similar instruments) may","page_number":255,"box":{"x":116,"y":149,"width":739,"height":12}},{"id":"bdc23aba-f732-44fa-9afc-856bda93c45f","block_type":"box","text":"give rise to ordinary income or loss to the extent such income or loss results from fluctuations in the","page_number":255,"box":{"x":116,"y":165,"width":744,"height":12}},{"id":"073a91cb-c602-4e8e-82fd-f7bc1c3bcd4d","block_type":"box","text":"value of the foreign currency concerned. Any such net gains could require a larger dividend toward the","page_number":255,"box":{"x":116,"y":180,"width":766,"height":12}},{"id":"76fe4eb1-20f1-4286-a143-508c5d8afb62","block_type":"box","text":"end of the calendar year. Any such net losses will generally reduce and potentially require the","page_number":255,"box":{"x":116,"y":196,"width":700,"height":12}},{"id":"d6a75f38-863d-4aea-b798-bc5297bcc373","block_type":"box","text":"recharacterization of prior ordinary income distributions. Such ordinary income treatment may","page_number":255,"box":{"x":117,"y":211,"width":698,"height":12}},{"id":"7fc9ffb7-1ee9-4453-a010-6ec32a346099","block_type":"box","text":"accelerate Fund distributions to shareholders and increase the distributions taxed to shareholders as","page_number":255,"box":{"x":116,"y":227,"width":753,"height":9}},{"id":"a66b7292-ea23-4981-9fa7-1d79a048e8ee","block_type":"box","text":"ordinary income. Any net ordinary losses so created cannot be carried forward by the Fund to offset","page_number":255,"box":{"x":116,"y":242,"width":746,"height":12}},{"id":"6c03249b-426d-4f26-92b7-e8f86d430aeb","block_type":"box","text":"income or gains earned in subsequent taxable years.","page_number":255,"box":{"x":117,"y":258,"width":398,"height":12}},{"id":"c6f44052-67aa-4fb7-9817-bfba1eb65d4c","block_type":"box","text":"Ordinary income dividends paid to shareholders who are nonresident aliens or foreign entities (other","page_number":255,"box":{"x":116,"y":289,"width":749,"height":12}},{"id":"f205a02e-ea71-4953-ba7b-8563852fa6dc","block_type":"box","text":"than pass-through entities to the extent owned by U.S. persons) generally will be subject to a 30% U.S.","page_number":255,"box":{"x":116,"y":304,"width":771,"height":12}},{"id":"4cbdc6b9-df44-4e1e-a5dc-fce86d913a2c","block_type":"box","text":"withholding tax under existing provisions of the Code applicable to foreign individuals and entities","page_number":255,"box":{"x":116,"y":320,"width":726,"height":12}},{"id":"100367c0-35d5-4b39-913c-a8520ab4f141","block_type":"box","text":"unless a reduced rate of withholding or a withholding exemption is provided under applicable treaty","page_number":255,"box":{"x":117,"y":335,"width":738,"height":12}},{"id":"ac9075c0-a651-4a6a-8dc5-66f572b39b48","block_type":"box","text":"law. Capital gain dividends paid to shareholders that are nonresident aliens or foreign entities, if and to","page_number":255,"box":{"x":117,"y":351,"width":766,"height":12}},{"id":"9022e3c2-041f-4bca-bf88-453ee5600a8a","block_type":"box","text":"the extent properly reported as capital gain dividends, generally will not be subject to a 30%","page_number":255,"box":{"x":116,"y":366,"width":685,"height":12}},{"id":"6d09fd0a-35ac-4878-af8b-38eed745153a","block_type":"box","text":"withholding tax, unless certain exceptions apply. Dividends derived by a regulated investment","page_number":255,"box":{"x":116,"y":382,"width":699,"height":12}},{"id":"074ffccd-503d-4c1c-8f96-20b3b3539365","block_type":"box","text":"company from short-term capital gains and qualified net interest income (including income from original","page_number":255,"box":{"x":116,"y":397,"width":771,"height":12}},{"id":"92db8102-cd2b-4aa1-b239-2070d9a747ba","block_type":"box","text":"issue discount and market discount) and paid to shareholders who are nonresident aliens or foreign","page_number":255,"box":{"x":117,"y":413,"width":743,"height":12}},{"id":"d0cfec56-a5ea-492a-b14e-a0c944b4ea64","block_type":"box","text":"entities, if and to the extent properly reported as “short-term capital gain dividends” or “interest-related","page_number":255,"box":{"x":116,"y":428,"width":762,"height":12}},{"id":"be77bdf9-ceed-46a5-8dfd-6f7afbb17582","block_type":"box","text":"dividends”, respectively, generally will not be subject to U.S. withholding tax. Where possible, the","page_number":255,"box":{"x":116,"y":444,"width":725,"height":12}},{"id":"5e3d6b74-f028-4710-b147-c19fb41120c2","block_type":"box","text":"Funds intend to report such dividends as interest-related dividends or short-term capital gain dividends.","page_number":255,"box":{"x":117,"y":459,"width":771,"height":12}},{"id":"8b960517-32b3-4bc0-8ce6-d02907e0c98e","block_type":"box","text":"However, depending on its circumstances, a Fund may report all, some or none of its potentially","page_number":255,"box":{"x":117,"y":475,"width":716,"height":12}},{"id":"b36f2eab-f56d-4f54-8f54-3b90adaa374b","block_type":"box","text":"eligible dividends as interest-related or as short-term capital gain dividends, and/or treat such","page_number":255,"box":{"x":116,"y":490,"width":697,"height":12}},{"id":"3b0f2b02-b768-4175-ab1a-e0982ff2b2ec","block_type":"box","text":"dividends, in whole or in part, as ineligible for this exemption from withholding. In order to qualify for","page_number":255,"box":{"x":116,"y":506,"width":743,"height":12}},{"id":"c5f62e63-ec3d-4f23-90ac-b5b8286aaf0c","block_type":"box","text":"this exemption from withholding, a foreign shareholder must comply with applicable certification","page_number":255,"box":{"x":116,"y":521,"width":712,"height":12}},{"id":"a2291bb1-a4ed-4f69-b4d6-771f09d624ad","block_type":"box","text":"requirements relating to its foreign status (including, in general, furnishing an IRS Form W-8BEN, IRS","page_number":255,"box":{"x":117,"y":537,"width":757,"height":12}},{"id":"1cbc650b-4424-4abd-85c9-459d2c11d75b","block_type":"box","text":"Form W-8BEN-E or substitute Form). In the case of shares held through an intermediary, the","page_number":255,"box":{"x":117,"y":552,"width":693,"height":12}},{"id":"44fd5e80-d9c2-44d4-a10c-aa0150ef7510","block_type":"box","text":"intermediary may withhold even if the Fund reports the payment as an interest-related or short-term","page_number":255,"box":{"x":117,"y":568,"width":743,"height":12}},{"id":"68bb8ce2-50c6-49a3-98b3-3173d75bc307","block_type":"box","text":"capital gain dividend. Foreign shareholders should contact their intermediaries with respect to the","page_number":255,"box":{"x":116,"y":583,"width":727,"height":12}},{"id":"99a2b431-3f96-466e-a5db-71f6bf021659","block_type":"box","text":"application of these rules to their accounts. It is not possible to predict what portion, if any, of a Fund’s","page_number":255,"box":{"x":116,"y":599,"width":762,"height":12}},{"id":"cdd5a0e8-09f0-4d32-8e81-b895cab39e5b","block_type":"box","text":"distributions will be reported as interest-related dividends or short-term capital gain dividends under","page_number":255,"box":{"x":116,"y":614,"width":742,"height":12}},{"id":"2b2d0028-e587-4874-95bd-24c38379052b","block_type":"box","text":"these rules.","page_number":255,"box":{"x":116,"y":630,"width":91,"height":9}},{"id":"10ba4875-5897-41b1-810c-f2f7e79213fe","block_type":"box","text":"Distributions to certain foreign shareholders by a Fund at least 50% of the assets of which are “U.S.","page_number":255,"box":{"x":117,"y":661,"width":737,"height":12}},{"id":"25bb0d38-9ff3-44f2-9df8-45df216420fd","block_type":"box","text":"real property interests” (as defined in the Code and Treasury regulations) at any time during the five","page_number":255,"box":{"x":117,"y":676,"width":745,"height":12}},{"id":"961406b0-751d-4931-92c4-566ef0b0790e","block_type":"box","text":"year period ending on the date of the distributions, to the extent the distributions are attributable to","page_number":255,"box":{"x":116,"y":692,"width":729,"height":12}},{"id":"0845643a-4d1c-415f-8774-eebb7d57fefd","block_type":"box","text":"gains from sales or exchanges of U.S. real property interests (including shares in certain “U.S. real","page_number":255,"box":{"x":116,"y":707,"width":731,"height":12}},{"id":"b40c6d47-a0ba-499f-b678-9c9bd7bdf05b","block_type":"box","text":"property holding corporations” such as certain REITs, although exceptions may apply if any class of","page_number":255,"box":{"x":117,"y":723,"width":739,"height":12}},{"id":"32c3e603-4be5-401d-85c6-992e279a87d8","block_type":"box","text":"stock of such a corporation is regularly traded on an established securities market and the Fund has","page_number":255,"box":{"x":116,"y":738,"width":743,"height":12}},{"id":"6a26110c-b0e4-44e9-90b0-1a987c15459c","block_type":"box","text":"held no more than 5% of such class of stock at all times during the five-year period ending on the date","page_number":255,"box":{"x":117,"y":754,"width":757,"height":12}},{"id":"026e55ce-ff1f-4027-8831-1d1e41001690","block_type":"box","text":"of the distributions), generally must be treated by such foreign shareholders as income effectively","page_number":255,"box":{"x":116,"y":769,"width":723,"height":12}},{"id":"4c21c27b-b80f-46a0-898d-dcf9513354ff","block_type":"box","text":"connected to a trade or business within the United States, which is generally subject to tax at the","page_number":255,"box":{"x":116,"y":785,"width":718,"height":12}},{"id":"6439994a-d593-4c02-91b1-75e7778251da","block_type":"box","text":"graduated rates applicable to U.S. shareholders, except for distributions to foreign shareholders that","page_number":255,"box":{"x":116,"y":800,"width":743,"height":12}},{"id":"601b2fbd-7c41-4ee8-8c99-ed89b143b762","block_type":"box","text":"held no more than 5% of any class of stock of the Fund at all times during the previous one-year period","page_number":255,"box":{"x":117,"y":816,"width":764,"height":12}},{"id":"300854d2-c294-41b5-a744-f3629a9c2b3a","block_type":"box","text":"ending on the date of the distributions. Such distributions will be subject to U.S. income and","page_number":255,"box":{"x":116,"y":831,"width":685,"height":12}},{"id":"c573ad44-d8db-4dc5-80de-32cbf5618d26","block_type":"box","text":"withholding tax and generally will require a foreign shareholder to file a U.S. federal income tax return.","page_number":255,"box":{"x":116,"y":847,"width":762,"height":12}},{"id":"36062495-2ed1-491b-98d0-2181708f6e3e","block_type":"box","text":"If the foreign shareholder held no more than 5% of any class of stock of the Fund at all times during the","page_number":255,"box":{"x":117,"y":862,"width":771,"height":12}},{"id":"8a14ee4b-7cb8-4fae-ac7b-ea14844a8ef2","block_type":"box","text":"previous one-year period ending on the date of the distributions, the distributions will be taxable as","page_number":255,"box":{"x":117,"y":878,"width":735,"height":12}},{"id":"c28965d6-7db0-4b4b-883d-dd4385c4030e","block_type":"box","text":"II-168","page_number":255,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"bd723f7c-143b-45cd-bb75-9b7f3ca90e0f","block_type":"box","text":"NM1026U-6004382-255/605","page_number":255,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"87497929-9312-416d-ba03-898ad34cdd4b","block_type":"box","text":"ordinary dividends and subject to withholding at a 30% or lower treaty rate. In addition, sales or","page_number":256,"box":{"x":116,"y":87,"width":711,"height":12}},{"id":"f3990e52-b77c-4b68-a4f4-1ae045622c0c","block_type":"box","text":"redemptions of shares held by certain foreign shareholders in such a Fund generally will be subject to","page_number":256,"box":{"x":117,"y":102,"width":758,"height":13}},{"id":"045fbf3b-4b70-4886-8965-5ba2355d8b8f","block_type":"box","text":"U.S. income and withholding tax and generally will require the foreign shareholder to file a U.S. federal","page_number":256,"box":{"x":117,"y":118,"width":765,"height":12}},{"id":"b0f057ee-8bc0-46de-9216-c91712b7e791","block_type":"box","text":"income tax return, although exceptions may apply if more than 50% of the value of the Fund’s shares","page_number":256,"box":{"x":117,"y":134,"width":755,"height":12}},{"id":"41146a31-1552-49fa-94b2-a6767130430d","block_type":"box","text":"are held by U.S. shareholders or the foreign shareholder selling or redeeming the shares has held no","page_number":256,"box":{"x":116,"y":149,"width":756,"height":12}},{"id":"9f2a2c3b-4940-4277-ab95-2d4155df2f3f","block_type":"box","text":"more than 5% of any class of stock of the Fund at all times during the five-year period ending on the","page_number":256,"box":{"x":117,"y":165,"width":747,"height":12}},{"id":"ab97b1e6-d3b9-4ba3-9336-7156e0bb1dce","block_type":"box","text":"date of the sale or redemption.","page_number":256,"box":{"x":116,"y":180,"width":233,"height":12}},{"id":"7ba08e74-f642-4ad7-a631-dba129e0db9e","block_type":"box","text":"Provided that more than 50% of the value of a Fund’s stock is held by U.S. shareholders, redemptions","page_number":256,"box":{"x":117,"y":211,"width":762,"height":12}},{"id":"6322274b-40ae-47e1-9e53-92d6c1202572","block_type":"box","text":"and other distributions made in the form of U.S. real property interests (including shares in certain","page_number":256,"box":{"x":116,"y":227,"width":730,"height":12}},{"id":"9b544a8a-089e-4563-8e57-d83d3a9891b5","block_type":"box","text":"“U.S. real property holding corporations”, although exceptions may apply if any class of stock of such a","page_number":256,"box":{"x":116,"y":242,"width":768,"height":12}},{"id":"917d98d6-c31f-464e-b446-d6a5e9e920c9","block_type":"box","text":"corporation is regularly traded on an established securities market and the Fund has held no more than","page_number":256,"box":{"x":116,"y":258,"width":772,"height":12}},{"id":"af95682f-ba47-4bee-8536-8abe048908a9","block_type":"box","text":"5% of such class of stock at all times during the five-year period ending on the date of the distribution)","page_number":256,"box":{"x":116,"y":273,"width":762,"height":12}},{"id":"b78d89c0-a4eb-4587-a170-227014b252b5","block_type":"box","text":"generally will cause the Fund to recognize a portion of any unrecognized gain in the U.S. real property","page_number":256,"box":{"x":116,"y":289,"width":763,"height":12}},{"id":"914bc921-ec62-477e-8574-36c97ba19b9e","block_type":"box","text":"interests equal to the product of (i) the excess of fair market value of such U.S. real property interests","page_number":256,"box":{"x":117,"y":304,"width":756,"height":12}},{"id":"bc4045aa-3ba5-4b24-8d2f-c509eb70adef","block_type":"box","text":"over the Fund’s adjusted bases in such interests and (ii) the greatest foreign ownership percentage of","page_number":256,"box":{"x":116,"y":320,"width":759,"height":12}},{"id":"d01bc8a3-dbc8-45f2-93b1-760413de33f0","block_type":"box","text":"the Fund during the five-year period ending on the date of distribution.","page_number":256,"box":{"x":116,"y":335,"width":525,"height":12}},{"id":"28ff6126-c751-40ae-846a-d02431689792","block_type":"box","text":"A foreign shareholder may also be subject to certain “wash sale” rules to prevent the avoidance of the","page_number":256,"box":{"x":116,"y":366,"width":760,"height":12}},{"id":"7836ac04-3fe7-48dc-bf4b-f8c56e3a2133","block_type":"box","text":"tax filing and payment obligations discussed above through the sale and repurchase of Fund shares.","page_number":256,"box":{"x":116,"y":382,"width":752,"height":12}},{"id":"b047ecac-a40a-46d7-a3da-76dde6c17772","block_type":"box","text":"Shareholders that are nonresident aliens or foreign entities are urged to consult their own tax advisors","page_number":256,"box":{"x":116,"y":413,"width":762,"height":12}},{"id":"e5333f39-040f-43c1-aecc-4a195027834f","block_type":"box","text":"concerning the particular tax consequences to them of an investment in a Fund.","page_number":256,"box":{"x":116,"y":428,"width":598,"height":12}},{"id":"93ecff24-4e0e-4ce6-b734-9c73ea7b2736","block_type":"box","text":"Separately, a 30% withholding tax is currently imposed on U.S.-source dividends, interest and other","page_number":256,"box":{"x":116,"y":459,"width":745,"height":12}},{"id":"2a220dd2-2709-41c2-b7c8-b4a3acc9f2c3","block_type":"box","text":"income items paid to (i) certain foreign financial institutions and investment funds, and (ii) certain other","page_number":256,"box":{"x":117,"y":475,"width":763,"height":12}},{"id":"a9f102a7-12e0-461b-a516-5d89c06549be","block_type":"box","text":"foreign entities. To avoid withholding, foreign financial institutions and investment funds will generally","page_number":256,"box":{"x":116,"y":490,"width":753,"height":12}},{"id":"4570ab92-acf8-473a-8d8b-c44ca5bbde52","block_type":"box","text":"either need to (a) collect and report to the IRS detailed information identifying their U.S. accounts and","page_number":256,"box":{"x":116,"y":506,"width":758,"height":12}},{"id":"75a30db7-7f1d-482d-9c48-52768dbf6cde","block_type":"box","text":"U.S. account holders, comply with due diligence procedures for identifying U.S. accounts and withhold","page_number":256,"box":{"x":117,"y":521,"width":763,"height":12}},{"id":"f3942dcb-5c87-4938-af83-2d86418db9d4","block_type":"box","text":"tax on certain payments made to noncomplying foreign entities and account holders or (b) if an","page_number":256,"box":{"x":116,"y":537,"width":709,"height":12}},{"id":"11ae6a8d-7c5a-40b3-9ae3-984872280b08","block_type":"box","text":"intergovernmental agreement is entered into and implementing legislation is adopted, comply with the","page_number":256,"box":{"x":117,"y":552,"width":758,"height":12}},{"id":"3cdc81d6-afa0-4913-9b49-bc9d60fc2237","block_type":"box","text":"agreement and legislation. Other foreign entities will generally either need to provide detailed","page_number":256,"box":{"x":116,"y":568,"width":695,"height":12}},{"id":"da55fbdd-6091-4e9f-b51d-882af0f171b8","block_type":"box","text":"information identifying each substantial U.S. owner or certify there are no such owners.","page_number":256,"box":{"x":117,"y":583,"width":650,"height":12}},{"id":"074f2679-5f6d-4fc6-be08-36849294aa62","block_type":"box","text":"Under certain provisions of the Code, some shareholders may be subject to a 24% withholding tax on","page_number":256,"box":{"x":117,"y":614,"width":757,"height":12}},{"id":"3e183b2e-90d2-46c8-a0de-63f01fc9025f","block_type":"box","text":"ordinary income dividends, capital gain dividends and redemption payments (“backup withholding”).","page_number":256,"box":{"x":116,"y":630,"width":744,"height":12}},{"id":"b9812c10-c67c-4bfe-a59d-e9d9ed231741","block_type":"box","text":"Generally, shareholders subject to backup withholding will be non-corporate shareholders for whom no","page_number":256,"box":{"x":117,"y":645,"width":767,"height":12}},{"id":"c790b06f-4326-4696-87fe-e34734df427c","block_type":"box","text":"certified taxpayer identification number is on file with the Fund or who, to the Fund’s knowledge, have","page_number":256,"box":{"x":116,"y":661,"width":752,"height":12}},{"id":"359741f4-21b1-45f6-84d5-92efbb8be2b8","block_type":"box","text":"furnished an incorrect number. When establishing an account, an investor must certify under penalty of","page_number":256,"box":{"x":116,"y":676,"width":766,"height":12}},{"id":"89feaee5-01c9-4d05-b0a5-bced9258a642","block_type":"box","text":"perjury that such number is correct and that such investor is not otherwise subject to backup","page_number":256,"box":{"x":117,"y":692,"width":684,"height":12}},{"id":"262e8067-520f-46eb-b0aa-aabd2c892c6e","block_type":"box","text":"withholding. Backup withholding is not an additional tax. Any amount withheld generally may be","page_number":256,"box":{"x":116,"y":707,"width":708,"height":12}},{"id":"599d4db8-e0f6-4607-842c-3160fb76afc2","block_type":"box","text":"allowed as a refund or a credit against a shareholder’s U.S. federal income tax liability, provided that","page_number":256,"box":{"x":116,"y":723,"width":745,"height":12}},{"id":"7cd85d6f-9865-49ac-9bd3-6a480c1666a9","block_type":"box","text":"the required information is timely forwarded to the IRS.","page_number":256,"box":{"x":116,"y":738,"width":405,"height":12}},{"id":"35540a23-ba4e-41ff-bc6f-fe9c1df2622f","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","page_number":256,"box":{"x":117,"y":768,"width":739,"height":13}},{"id":"e046d7cb-e4a7-483b-918d-3d6306bdc14f","block_type":"box","text":"taxable year or $4 million in any combination of taxable years for an individual shareholder or","page_number":256,"box":{"x":116,"y":784,"width":691,"height":13}},{"id":"3893435c-8edd-48c7-a4d3-00dd20ba7c57","block_type":"box","text":"$10 million in any single taxable year or $20 million in any combination of taxable years for a corporate","page_number":256,"box":{"x":116,"y":799,"width":762,"height":13}},{"id":"e2e2405b-d8f2-472d-951b-999aa563c402","block_type":"box","text":"shareholder in any single taxable year, the shareholder must file a disclosure statement on IRS Form","page_number":256,"box":{"x":116,"y":816,"width":749,"height":12}},{"id":"bd673c71-f3ba-449d-ab0e-cf8c92c83312","block_type":"box","text":"8886 with the IRS. Direct shareholders of portfolio securities are in many cases exempted. That a loss","page_number":256,"box":{"x":116,"y":831,"width":763,"height":12}},{"id":"77c4f68a-44dc-4d71-b37a-700c3d415bcd","block_type":"box","text":"is reportable under these regulations does not affect the legal determination of whether the taxpayer’s","page_number":256,"box":{"x":117,"y":847,"width":760,"height":12}},{"id":"d3e6a6d1-0868-414c-aeb1-2f7d463bae35","block_type":"box","text":"treatment of the loss is proper. Shareholders should consult their tax advisors to determine the","page_number":256,"box":{"x":116,"y":862,"width":707,"height":12}},{"id":"6cbf410c-c35d-4df0-a3aa-daa1f8a50619","block_type":"box","text":"applicability of these regulations in light of their individual circumstances.","page_number":256,"box":{"x":116,"y":878,"width":544,"height":12}},{"id":"307b98f2-b0c1-4880-ba2a-10b4088b82b2","block_type":"box","text":"II-169","page_number":256,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"d8def2f4-e7a3-43e3-9f93-5c675d30bd99","block_type":"box","text":"NM1026U-6004382-256/605","page_number":256,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"cd716ff0-5a67-4953-ac7b-cfe77d645a33","block_type":"box","text":"Certain types of income received by a Fund from REITs, real estate mortgage investment conduits,","page_number":257,"box":{"x":117,"y":87,"width":740,"height":12}},{"id":"977e8c3f-f3f9-4ad9-84e5-f33667702f5b","block_type":"box","text":"taxable mortgage pools or other investments may cause the Fund to report some or all of its","page_number":257,"box":{"x":116,"y":102,"width":689,"height":13}},{"id":"540ef8ef-1635-42de-bf5f-f1b07bf504cb","block_type":"box","text":"distributions as “excess inclusion income.” To Fund shareholders, such excess inclusion income may:","page_number":257,"box":{"x":116,"y":118,"width":760,"height":12}},{"id":"031c30e4-cd5c-4917-b021-5bfb71b71bff","block_type":"box","text":"(i) constitute taxable income, as unrelated business taxable income (“UBTI”) for those shareholders","page_number":257,"box":{"x":117,"y":134,"width":742,"height":12}},{"id":"709e2b6a-98e6-4664-a692-982728960664","block_type":"box","text":"who would otherwise be tax-exempt such as individual retirement accounts, 401(k) accounts, Keogh","page_number":257,"box":{"x":116,"y":149,"width":749,"height":12}},{"id":"9a31be68-42ea-4abc-bdc8-5523e190ecea","block_type":"box","text":"plans, pension plans and certain charitable entities; (ii) not be offset by otherwise allowable deductions","page_number":257,"box":{"x":117,"y":165,"width":766,"height":12}},{"id":"f3698f57-eda5-408a-a4eb-fc0bcf8674e4","block_type":"box","text":"for tax purposes; (iii) not be eligible for reduced U.S. withholding for non-U.S. shareholders even from","page_number":257,"box":{"x":116,"y":180,"width":758,"height":12}},{"id":"c89d1308-5e3e-4802-8903-d78cf335d868","block_type":"box","text":"tax treaty countries; and (iv) cause the Fund to be subject to tax if certain “disqualified organizations,”","page_number":257,"box":{"x":116,"y":196,"width":757,"height":12}},{"id":"378f8faf-39c1-46c5-9270-f801cca0722e","block_type":"box","text":"as defined by the Code, are Fund shareholders. The Fund tries to avoid investing in REITs that are","page_number":257,"box":{"x":116,"y":211,"width":740,"height":12}},{"id":"78aa9606-8145-40a8-8e50-8d93f86fda00","block_type":"box","text":"expected to generate excess inclusion income, but the Fund may not always be successful in doing so.","page_number":257,"box":{"x":116,"y":227,"width":771,"height":12}},{"id":"4791fa30-6749-447c-92a7-0d92e9e51fd9","block_type":"box","text":"Because information about a REIT’s investments may be inadequate or inaccurate, or because a REIT","page_number":257,"box":{"x":117,"y":242,"width":767,"height":12}},{"id":"d7a32157-f943-4223-8c40-7e39a9d68765","block_type":"box","text":"may change its investment program, the Fund may not be successful in avoiding the consequences","page_number":257,"box":{"x":117,"y":258,"width":744,"height":12}},{"id":"f5b3f612-080f-460d-a805-fde4f41ae82d","block_type":"box","text":"described above. Avoidance of investments in REITs that generate excess inclusion income may","page_number":257,"box":{"x":116,"y":273,"width":725,"height":12}},{"id":"0755b974-a610-4db8-8abb-758b7ab7b5a4","block_type":"box","text":"require the Fund to forego otherwise attractive investment opportunities.","page_number":257,"box":{"x":117,"y":289,"width":540,"height":12}},{"id":"ff521412-4756-4f70-8fef-91eef86490d0","block_type":"box","text":"Dividends and interest received and capital gains realized by a Fund may give rise to withholding and","page_number":257,"box":{"x":117,"y":320,"width":756,"height":12}},{"id":"656cd067-d4fb-4218-b3b4-6f3e57204dbf","block_type":"box","text":"other taxes imposed by foreign countries. Tax conventions between certain foreign countries and the","page_number":257,"box":{"x":116,"y":335,"width":753,"height":12}},{"id":"c2aa768d-60bc-4b0d-962f-f44f6ba037c4","block_type":"box","text":"United States may reduce or eliminate such taxes. Shareholders of a Fund more than 50% by value of","page_number":257,"box":{"x":117,"y":351,"width":764,"height":12}},{"id":"ce759cb5-0c6b-4718-ad5f-bfbe55441a0c","block_type":"box","text":"the assets of which at the close of a taxable year are foreign securities may be able to claim U.S.","page_number":257,"box":{"x":116,"y":366,"width":725,"height":12}},{"id":"e79b10dc-577d-42b1-a713-e05382e6e3ca","block_type":"box","text":"foreign tax credits with respect to such foreign taxes paid by the Fund, subject to certain requirements","page_number":257,"box":{"x":116,"y":382,"width":762,"height":12}},{"id":"93fc1c01-b385-4dd7-af8f-5bd71da12bad","block_type":"box","text":"and limitations contained in the Code. For example, certain retirement accounts and certain tax-exempt","page_number":257,"box":{"x":116,"y":397,"width":772,"height":12}},{"id":"c976663c-1c61-46bd-a0d9-8393fdebaa59","block_type":"box","text":"organizations cannot claim foreign tax credits on investments in foreign securities held in a Fund. In","page_number":257,"box":{"x":116,"y":413,"width":743,"height":12}},{"id":"8020f860-49a1-473a-af41-6d340e0cb3e4","block_type":"box","text":"addition, a foreign tax credit may be claimed with respect to withholding tax on payments with respect","page_number":257,"box":{"x":116,"y":428,"width":759,"height":12}},{"id":"45bf5b25-f679-491d-8384-284a2edf445a","block_type":"box","text":"to a security only if the holder of the security meets certain holding period requirements. Both the","page_number":257,"box":{"x":116,"y":444,"width":724,"height":12}},{"id":"0b7650e3-d0c7-431d-bd37-7d2afe0881f1","block_type":"box","text":"shareholder and the Fund must meet these holding period requirements, and if a Fund fails to do so, it","page_number":257,"box":{"x":116,"y":459,"width":764,"height":12}},{"id":"fd3cd8be-3e9e-4de5-9787-3a072bf382a1","block_type":"box","text":"will not be able to “pass through” to shareholders the ability to claim a credit or a deduction for the","page_number":257,"box":{"x":116,"y":475,"width":731,"height":12}},{"id":"a2b85fdc-5f70-4c79-be70-87fe21416117","block_type":"box","text":"related foreign taxes paid by the Fund. Further, to the extent that a Fund engages in securities lending","page_number":257,"box":{"x":117,"y":490,"width":763,"height":12}},{"id":"3055a238-de60-4e08-b01b-44760748954c","block_type":"box","text":"with respect to a security paying income subject to foreign taxes, it may not be able to pass through to","page_number":257,"box":{"x":116,"y":506,"width":763,"height":12}},{"id":"339ac41d-3d9f-499a-9209-ab28a26adfd5","block_type":"box","text":"its shareholders the ability to take a foreign tax credit for those taxes. If a Fund satisfies the applicable","page_number":257,"box":{"x":117,"y":521,"width":762,"height":12}},{"id":"cfa74189-ce64-4c9f-a746-fd7059185381","block_type":"box","text":"requirements, such Fund will be eligible to file an election with the IRS pursuant to which shareholders","page_number":257,"box":{"x":117,"y":537,"width":763,"height":12}},{"id":"adb88cbc-a6ff-4360-b082-e680ac796d3d","block_type":"box","text":"of the Fund will be required to include their proportionate shares of such foreign taxes in their U.S.","page_number":257,"box":{"x":116,"y":552,"width":733,"height":12}},{"id":"f427c1d0-a28c-40bd-a842-0138784516ba","block_type":"box","text":"income tax returns as gross income, treat such proportionate shares as taxes paid by them, and","page_number":257,"box":{"x":117,"y":568,"width":718,"height":12}},{"id":"7d9ae992-3738-4a14-9f37-866a1faeb8f0","block_type":"box","text":"deduct such proportionate shares in computing their taxable incomes or, alternatively, use them as","page_number":257,"box":{"x":116,"y":583,"width":738,"height":12}},{"id":"6ac53e92-f87b-4a1f-80a5-254ffcc5a46e","block_type":"box","text":"foreign tax credits against their U.S. income taxes. No deductions for foreign taxes, however, may be","page_number":257,"box":{"x":116,"y":599,"width":755,"height":12}},{"id":"9359a52c-afdb-42f0-95b7-413505f3a464","block_type":"box","text":"claimed by noncorporate shareholders who do not itemize deductions. A shareholder that is a","page_number":257,"box":{"x":116,"y":614,"width":699,"height":12}},{"id":"a9a152a6-bf01-48c1-b7df-92dc36620f77","block_type":"box","text":"nonresident alien individual or a foreign corporation may be subject to U.S. withholding tax on the","page_number":257,"box":{"x":117,"y":630,"width":726,"height":12}},{"id":"8ca3bd1b-9e3b-4703-8d0b-6a514ee4f6d9","block_type":"box","text":"income resulting from a Fund’s election described in this paragraph but may not be able to claim a","page_number":257,"box":{"x":117,"y":645,"width":733,"height":12}},{"id":"85df4a5d-86be-4ee6-8fb6-abb64430aa88","block_type":"box","text":"credit or deduction against such U.S. tax for the foreign taxes treated as having been paid by such","page_number":257,"box":{"x":116,"y":661,"width":730,"height":12}},{"id":"498709da-3159-4241-b664-a81c3f296eca","block_type":"box","text":"shareholder. A Fund will report annually to its shareholders the amount per share of such foreign taxes","page_number":257,"box":{"x":116,"y":676,"width":763,"height":12}},{"id":"a47b075f-4cab-478b-830a-a8322ac527b3","block_type":"box","text":"and other information needed to claim the foreign tax credit.","page_number":257,"box":{"x":116,"y":692,"width":443,"height":12}},{"id":"a799117d-c976-41b3-a96a-d64ebe728fb0","block_type":"box","text":"Certain transactions entered into by the Funds are subject to special tax rules of the Code that may,","page_number":257,"box":{"x":117,"y":723,"width":739,"height":12}},{"id":"dc4fabdb-1687-494b-b0ad-3be886ff3161","block_type":"box","text":"among other things, (a) affect the character of gains and losses realized, (b) disallow, suspend or","page_number":257,"box":{"x":116,"y":738,"width":722,"height":12}},{"id":"5d02f872-9220-404a-ad0a-0db976f73c8c","block_type":"box","text":"otherwise limit the allowance of certain losses or deductions, and (c) accelerate the recognition of","page_number":257,"box":{"x":116,"y":754,"width":724,"height":12}},{"id":"47ca0035-123f-448c-9156-fe570f4c7cc5","block_type":"box","text":"income without a corresponding receipt of cash (with which to make the necessary distributions to","page_number":257,"box":{"x":117,"y":769,"width":725,"height":12}},{"id":"dc264693-6dc4-45f8-9055-9f72fe2f925c","block_type":"box","text":"satisfy distribution requirements applicable to regulated investment companies). Operation of these","page_number":257,"box":{"x":116,"y":785,"width":736,"height":12}},{"id":"18cfe015-3b95-4c5e-aaf2-c8e49af6606e","block_type":"box","text":"rules could, therefore, affect the character, amount and timing of distributions to shareholders. Special","page_number":257,"box":{"x":117,"y":800,"width":756,"height":12}},{"id":"0c3249bc-3e3c-4dc3-be32-98ba1c5dfd11","block_type":"box","text":"tax rules also may require a Fund to mark-to-market certain types of positions in its portfolio (","page_number":257,"box":{"x":116,"y":816,"width":691,"height":12}},{"id":"1ae037df-38a5-4404-aba6-8f8452f838d0","block_type":"box","text":"i.e.","page_number":257,"box":{"x":808,"y":816,"width":20,"height":9}},{"id":"4f8b71ed-119a-4221-ad17-1958e76c636c","block_type":"box","text":", treat","page_number":257,"box":{"x":831,"y":816,"width":42,"height":11}},{"id":"e67a34a5-054b-4619-87ee-f67329b8acbd","block_type":"box","text":"them as sold on the last day of the taxable year), and may result in the recognition of income without a","page_number":257,"box":{"x":116,"y":831,"width":765,"height":12}},{"id":"20c97e0d-55cb-4912-93ea-449715a8ad66","block_type":"box","text":"corresponding receipt of cash. Funds engaging in transactions affected by these provisions intend to","page_number":257,"box":{"x":116,"y":847,"width":751,"height":12}},{"id":"c1c985e2-adb2-4c4d-a9ed-af20cc0c05ce","block_type":"box","text":"monitor their transactions, make appropriate tax elections and make appropriate entries in their books","page_number":257,"box":{"x":117,"y":862,"width":760,"height":12}},{"id":"586a911d-f88a-43ba-8007-9fa009cb1b94","block_type":"box","text":"II-170","page_number":257,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"ad04ae3a-d53b-4aaf-a99e-10dc3e06569c","block_type":"box","text":"NM1026U-6004382-257/605","page_number":257,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"7dbe4117-c9f3-463f-8a4e-6537e44e2a07","block_type":"box","text":"and records to lessen the effect of these tax rules and avoid any possible disqualification from the","page_number":258,"box":{"x":116,"y":87,"width":730,"height":12}},{"id":"a5666fff-794c-43f1-b0e6-7a6a3a7f91dc","block_type":"box","text":"special treatment afforded regulated investment companies under the Code.","page_number":258,"box":{"x":116,"y":102,"width":571,"height":13}},{"id":"f26927ef-a9df-4ae1-adaa-833b189c57a1","block_type":"box","text":"Certain of a Fund’s investments in derivative instruments and foreign currency-denominated","page_number":258,"box":{"x":117,"y":130,"width":687,"height":13}},{"id":"23b2ab8a-dfa9-48c4-b8cb-27344cbfab16","block_type":"box","text":"instruments, and any of the Fund’s transactions in foreign currencies and hedging activities, are likely","page_number":258,"box":{"x":117,"y":146,"width":756,"height":12}},{"id":"57de5fdb-e0ca-4fa6-a67f-561be0780700","block_type":"box","text":"to produce a difference between its book income and the sum of its taxable income and net tax-exempt","page_number":258,"box":{"x":116,"y":161,"width":771,"height":12}},{"id":"81fd1952-2837-430e-9570-464d5492f935","block_type":"box","text":"income (if any). If such a difference arises, and the Fund’s book income is less than the sum of its","page_number":258,"box":{"x":117,"y":177,"width":730,"height":12}},{"id":"3940d9a1-20bd-4f29-94c4-52ffec1c0fd0","block_type":"box","text":"taxable income and net tax-exempt income, the Fund could be required to make distributions","page_number":258,"box":{"x":116,"y":193,"width":695,"height":11}},{"id":"42289add-6a25-4fe1-a4c5-a57dcda12a28","block_type":"box","text":"exceeding book income to qualify as a RIC that is accorded special tax treatment and to avoid an","page_number":258,"box":{"x":116,"y":208,"width":727,"height":12}},{"id":"3296ca18-7122-4f5c-ab92-c5d851b54e0e","block_type":"box","text":"entity-level tax. In the alternative, if the Fund makes any distribution based on book income and such","page_number":258,"box":{"x":116,"y":223,"width":754,"height":13}},{"id":"ae05814f-56f0-46fa-b716-f53985c8fc1c","block_type":"box","text":"book income exceeds the sum of its taxable income (including realized capital gains) and net tax","page_number":258,"box":{"x":117,"y":239,"width":721,"height":12}},{"id":"6a2014d7-31e6-4392-affb-bed59cb4bb35","block_type":"box","text":"exempt income, the distribution (if any) of such excess generally will be treated as (i) a dividend to the","page_number":258,"box":{"x":116,"y":254,"width":761,"height":13}},{"id":"cac93d06-4f3d-4962-a6f6-2621e954c0e8","block_type":"box","text":"extent of the Fund’s remaining earnings and profits (including earnings and profits arising from tax","page_number":258,"box":{"x":116,"y":270,"width":733,"height":12}},{"id":"cc5c5ae8-8252-4de6-bf1c-b2ce03e6b731","block_type":"box","text":"exempt income), (ii) thereafter, as a return of capital to the extent of the recipient’s basis in its shares,","page_number":258,"box":{"x":116,"y":285,"width":759,"height":13}},{"id":"52f78e28-b770-460a-840e-5b09de1abc72","block_type":"box","text":"and (iii) thereafter as gain from the sale or exchange of a capital asset.","page_number":258,"box":{"x":116,"y":301,"width":530,"height":12}},{"id":"ba53bd52-0378-4c90-a858-894f937ecad6","block_type":"box","text":"If a Fund invests in underlying funds, the Fund’s","page_number":258,"box":{"x":117,"y":329,"width":361,"height":12}},{"id":"62d4cab3-9d94-4ae2-a824-351e5628d8ab","block_type":"box","text":"realized losses on sales of shares of underlying funds","page_number":258,"box":{"x":479,"y":329,"width":403,"height":12}},{"id":"53f9aadd-c83a-4f11-a6df-c4ca5c7e791b","block_type":"box","text":"may be indefinitely or permanently deferred as “wash sales.” Distributions of short-term capital gains","page_number":258,"box":{"x":117,"y":344,"width":749,"height":12}},{"id":"56bd5cbb-9e27-4343-a90e-852f35565b72","block_type":"box","text":"by underlying funds will be recognized as ordinary income by the Fund and would not be offset by the","page_number":258,"box":{"x":117,"y":360,"width":757,"height":12}},{"id":"d4e8bc23-e5e9-431f-b9a0-9a459f9baaf7","block_type":"box","text":"Fund’s capital loss carryforwards, if any. Capital loss carryforwards of underlying funds, if any, would","page_number":258,"box":{"x":117,"y":375,"width":751,"height":12}},{"id":"ea351e1a-c564-4362-bc7e-3518698d8531","block_type":"box","text":"not offset net capital gains of the Fund. Each of these effects is caused by the Fund’s expected","page_number":258,"box":{"x":117,"y":391,"width":710,"height":12}},{"id":"ab013fe6-c856-4c47-a049-b3e66b4e918e","block_type":"box","text":"investment in the underlying funds and may result in distributions to Fund shareholders being of higher","page_number":258,"box":{"x":117,"y":406,"width":766,"height":12}},{"id":"26e091f4-3847-46a1-bed4-486263842a30","block_type":"box","text":"magnitudes and less likely to qualify for lower capital gain tax rates than if the Fund were to invest","page_number":258,"box":{"x":117,"y":422,"width":730,"height":12}},{"id":"bf47e9b8-39cd-473f-857e-3e18795b7e21","block_type":"box","text":"otherwise.","page_number":258,"box":{"x":116,"y":438,"width":81,"height":9}},{"id":"5579f8d1-67d1-4c17-985d-41798446c38c","block_type":"box","text":"A Fund may take certain positions through a wholly-owned (or majority-owned), foreign subsidiary (the","page_number":258,"box":{"x":116,"y":465,"width":765,"height":12}},{"id":"d8310801-93bf-498f-96e9-11f71a8ef703","block_type":"box","text":"“Subsidiary”). It is expected that the Subsidiary will be a “controlled foreign corporation” and that all of","page_number":258,"box":{"x":116,"y":481,"width":758,"height":12}},{"id":"314d9c69-e42d-4369-a46a-dbe4ba832f1a","block_type":"box","text":"its net income will be “subpart F income” for U.S. federal income tax purposes. If that is the case, the","page_number":258,"box":{"x":117,"y":496,"width":752,"height":12}},{"id":"938aa8f8-db56-4e34-bc21-54e679771581","block_type":"box","text":"Fund will be required to report all of the Subsidiary’s net income as ordinary income regardless of","page_number":258,"box":{"x":117,"y":512,"width":726,"height":12}},{"id":"f8ca1c9d-69a2-47e1-98b1-d6d7f0243c25","block_type":"box","text":"whether that income would be treated differently (for example, as capital gain) at the Subsidiary level","page_number":258,"box":{"x":116,"y":527,"width":753,"height":12}},{"id":"b310c1c2-ed60-4ec5-a545-146d261898dc","block_type":"box","text":"and regardless of whether that income is distributed to the Fund. (Previously taxed income will not,","page_number":258,"box":{"x":116,"y":543,"width":738,"height":12}},{"id":"ea559a9e-b75d-495c-856d-d7a761e490e2","block_type":"box","text":"however, be taxable again when distributed.) If a net loss is realized by the Subsidiary in any taxable","page_number":258,"box":{"x":117,"y":558,"width":751,"height":12}},{"id":"80e34bab-e58b-4c3e-87fc-41e292c4b972","block_type":"box","text":"year, the loss will generally not be available to offset the Fund’s other income. It is not expected that","page_number":258,"box":{"x":116,"y":574,"width":747,"height":12}},{"id":"b8c2ecce-d23b-4a2b-a6c7-37692fed2599","block_type":"box","text":"the Subsidiary will be subject to an entity-level federal tax.","page_number":258,"box":{"x":116,"y":589,"width":436,"height":12}},{"id":"56696662-2ca6-409c-a51d-ae57279e7984","block_type":"box","text":"If a Fund purchases shares of an investment company (or similar investment entity) organized under","page_number":258,"box":{"x":117,"y":617,"width":750,"height":12}},{"id":"00a7dd23-7f0c-4f70-bb3f-c128fecd1054","block_type":"box","text":"foreign law, the Fund will generally be treated as owning shares in a passive foreign investment","page_number":258,"box":{"x":116,"y":633,"width":714,"height":12}},{"id":"532fb3c3-6957-4743-87e7-84a3dcbd6fae","block_type":"box","text":"company (“PFIC”) for U.S. federal income tax purposes. A Fund may be subject to U.S. federal income","page_number":258,"box":{"x":116,"y":648,"width":769,"height":12}},{"id":"41984479-02f9-40f1-8185-9b871c9ac249","block_type":"box","text":"tax, and interest charges (at the rate applicable to tax underpayments) on tax liability treated as having","page_number":258,"box":{"x":116,"y":664,"width":761,"height":12}},{"id":"c033c90e-2e3d-4496-a9d2-ef79d4c616d4","block_type":"box","text":"been deferred with respect to certain distributions from such a company and on gain from the","page_number":258,"box":{"x":117,"y":679,"width":691,"height":12}},{"id":"95d71468-fef8-4703-a5a8-a435e431c8bf","block_type":"box","text":"disposition of the shares of such a company (collectively referred to as “excess distributions”), even if","page_number":258,"box":{"x":116,"y":695,"width":752,"height":12}},{"id":"97393b6b-c68d-4a34-b864-b28d456232d9","block_type":"box","text":"such excess distributions are paid by the Fund as a dividend to its shareholders. However, a Fund may","page_number":258,"box":{"x":116,"y":710,"width":766,"height":12}},{"id":"63d791f8-8192-4d62-8fe2-f646503ecc33","block_type":"box","text":"elect to “mark-to-market” at the end of each taxable year shares that it holds in PFICs. The election is","page_number":258,"box":{"x":116,"y":726,"width":753,"height":12}},{"id":"1cd098c8-fcce-45a8-8a4e-d1c14d88f590","block_type":"box","text":"made separately for each PFIC held and, once made, would be effective for all subsequent taxable","page_number":258,"box":{"x":117,"y":741,"width":734,"height":12}},{"id":"753a6a33-4c95-4a05-a0a6-f54caa535371","block_type":"box","text":"years, unless revoked with consent from the IRS. Under this election, a Fund would recognize as","page_number":258,"box":{"x":116,"y":757,"width":719,"height":12}},{"id":"98c04e6f-d558-4491-b11f-3ce2778bbd0a","block_type":"box","text":"ordinary income any increase in the value of its shares as of the close of the taxable year over their","page_number":258,"box":{"x":116,"y":772,"width":737,"height":12}},{"id":"933c5323-2170-4a65-a7a7-8d96641ec4e6","block_type":"box","text":"adjusted tax basis and as ordinary loss any decrease in such value, but only to the extent of previously","page_number":258,"box":{"x":116,"y":788,"width":763,"height":12}},{"id":"c95e18ae-d9c2-44c6-977e-4383de16cd0e","block_type":"box","text":"recognized “mark-to-market” gains. By making the mark-to-market election, a Fund could avoid","page_number":258,"box":{"x":117,"y":803,"width":704,"height":12}},{"id":"7ea1a2d7-bd44-4344-80e1-9ac86b4ca1fa","block_type":"box","text":"imposition of the interest charge with respect to excess distributions from PFICs, but in any particular","page_number":258,"box":{"x":117,"y":819,"width":749,"height":12}},{"id":"72909cd4-4d16-49f9-a110-fb8fba6bcc13","block_type":"box","text":"year might be required to recognize income in excess of the distributions it received from PFICs.","page_number":258,"box":{"x":116,"y":834,"width":720,"height":12}},{"id":"b0f9c9a0-998a-41ba-8a23-14c19bf34265","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","page_number":258,"box":{"x":117,"y":862,"width":746,"height":12}},{"id":"b54b20fe-be9a-472d-9bf7-9b54bd0d415d","block_type":"box","text":"Code, in lieu of the foregoing requirements, the Fund would be required to include in income each year","page_number":258,"box":{"x":117,"y":878,"width":768,"height":12}},{"id":"a0976852-2d47-4b9e-b384-27c09d867610","block_type":"box","text":"II-171","page_number":258,"box":{"x":480,"y":909,"width":38,"height":9}},{"id":"1d694e84-915b-4acc-bdf9-456112158ef7","block_type":"box","text":"NM1026U-6004382-258/605","page_number":258,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a6ecbbe6-944c-41fb-8879-26853ab389cc","block_type":"box","text":"a portion of the ordinary earnings and net capital gains of the qualified electing fund, even if not","page_number":259,"box":{"x":116,"y":87,"width":712,"height":12}},{"id":"c1893f2f-7c1d-44fc-b0c8-8b5c6c4d5b51","block_type":"box","text":"distributed to the Fund, and such amounts would be subject to the 90% and excise tax distribution","page_number":259,"box":{"x":116,"y":102,"width":732,"height":13}},{"id":"a773c765-10f5-4fc6-a61e-c2b0cd3f6bf1","block_type":"box","text":"requirements described above. In order to make this election, the Fund would be required to obtain","page_number":259,"box":{"x":117,"y":118,"width":739,"height":12}},{"id":"611bac47-0e4d-4b87-8b46-1df526e20629","block_type":"box","text":"certain annual information from the PFICs in which it invests, which may be difficult or impossible to","page_number":259,"box":{"x":116,"y":134,"width":743,"height":12}},{"id":"c9ad3471-f0ec-4f1e-861d-f352bfadc37d","block_type":"box","text":"obtain.","page_number":259,"box":{"x":116,"y":149,"width":55,"height":10}},{"id":"923ec1dc-a4b1-4250-b1ce-00340b3f7b0b","block_type":"box","text":"In certain situations, a Fund may, for a taxable year, defer","page_number":259,"box":{"x":117,"y":179,"width":434,"height":12}},{"id":"a07c5460-e86a-4ff3-aa50-17c16487f7f5","block_type":"box","text":"all or a portion of its net capital loss (or if","page_number":259,"box":{"x":552,"y":179,"width":305,"height":12}},{"id":"274576b5-8c11-42de-ae72-53e17fe6d00d","block_type":"box","text":"there is no net capital loss, any net long-term or short-term capital loss) realized after October and its","page_number":259,"box":{"x":116,"y":194,"width":755,"height":12}},{"id":"4c709982-7b94-437b-b11a-8a00ed0ad362","block_type":"box","text":"late-year ordinary loss (defined as the sum of the excess of post-October foreign currency and PFIC","page_number":259,"box":{"x":117,"y":210,"width":748,"height":12}},{"id":"b5146797-c0c2-489a-a329-dacdc4d2227e","block_type":"box","text":"losses over post-October foreign currency and PFIC gains plus the excess of post-December ordinary","page_number":259,"box":{"x":117,"y":225,"width":761,"height":12}},{"id":"5a0d082c-9b97-4227-b6eb-39d2ae58a3f5","block_type":"box","text":"losses over post-December ordinary income) until the next taxable year in computing its investment","page_number":259,"box":{"x":117,"y":241,"width":743,"height":12}},{"id":"97d0fb76-c059-4de1-a895-ee6764dafd02","block_type":"box","text":"company taxable income and net capital gain, which will defer the recognition of such realized losses.","page_number":259,"box":{"x":116,"y":256,"width":759,"height":12}},{"id":"ee05fb68-2266-4eeb-a2bb-f9f75b44627a","block_type":"box","text":"Such deferrals and other rules regarding gains and losses realized after October (or December) may","page_number":259,"box":{"x":116,"y":272,"width":752,"height":12}},{"id":"4f6b09b0-d286-4aea-864b-16fc1cf5b92c","block_type":"box","text":"affect the tax character of shareholder distributions.","page_number":259,"box":{"x":116,"y":287,"width":387,"height":10}},{"id":"d0782ef3-f350-4c4f-b767-24bfdcfbd803","block_type":"box","text":"Municipal Funds","page_number":259,"box":{"x":116,"y":317,"width":127,"height":12}},{"id":"ed2de4e7-bec9-46d2-a610-35e877cf4cec","block_type":"box","text":"Each Municipal Fund intends to qualify to pay “exempt-interest dividends” as defined in","page_number":259,"box":{"x":117,"y":339,"width":650,"height":12}},{"id":"50cf2a2e-eab0-4951-a4f1-14f6f6969ce7","block_type":"box","text":"Section 852(b)(5) of the Code. Under such section if, at the close of each quarter of a Fund’s taxable","page_number":259,"box":{"x":116,"y":355,"width":753,"height":12}},{"id":"b2cf962a-196e-4c9a-b601-6ca95c1e8fe7","block_type":"box","text":"year, at least 50% of the value of the Fund’s total assets consists of obligations exempt from U.S.","page_number":259,"box":{"x":116,"y":370,"width":728,"height":12}},{"id":"18e2f724-3778-494d-a525-5a47cd13975e","block_type":"box","text":"federal income tax (“tax-exempt obligations”) under Section 103(a) of the Code (relating generally to","page_number":259,"box":{"x":116,"y":386,"width":748,"height":12}},{"id":"f9882d5c-aa3c-42ba-b885-9a3525bf072c","block_type":"box","text":"obligations of a state or local governmental unit), the Fund shall be qualified to pay exempt-interest","page_number":259,"box":{"x":116,"y":401,"width":739,"height":12}},{"id":"ea600140-8e42-4683-825f-b98628879837","block_type":"box","text":"dividends to holders of all outstanding classes of its shares (together the “shareholders”). Exempt","page_number":259,"box":{"x":116,"y":417,"width":728,"height":12}},{"id":"addb80c6-594c-464d-a38d-3352b5466e3c","block_type":"box","text":"interest dividends are dividends or any part thereof paid by a Fund that are attributable to interest on","page_number":259,"box":{"x":117,"y":432,"width":749,"height":12}},{"id":"e9d5f238-3f5d-4220-b8a9-821c0517600e","block_type":"box","text":"tax-exempt obligations and reported by the Fund as exempt-interest dividends. A Fund will allocate","page_number":259,"box":{"x":116,"y":448,"width":740,"height":12}},{"id":"aff704bf-bd7a-4a7f-9a6b-e2dad940a468","block_type":"box","text":"interest from tax-exempt obligations (as well as ordinary income, capital gains and tax preference","page_number":259,"box":{"x":117,"y":463,"width":727,"height":12}},{"id":"6e7ace57-9879-401c-8449-43c826c17448","block_type":"box","text":"items discussed below) among the Fund’s shareholders according to a method (that it believes is","page_number":259,"box":{"x":117,"y":479,"width":725,"height":12}},{"id":"20c22bad-4818-47e4-ad1b-81ebbc40aca7","block_type":"box","text":"consistent with the Commission rule permitting the issuance and sale of multiple classes of shares)","page_number":259,"box":{"x":116,"y":494,"width":741,"height":12}},{"id":"5bb5f4e7-6e37-4163-a92a-68fdb2865ae8","block_type":"box","text":"that is based upon the gross income that is allocable to each class of shareholders during the taxable","page_number":259,"box":{"x":116,"y":510,"width":758,"height":12}},{"id":"e89f9944-d414-4080-8536-c4ca9d6468fe","block_type":"box","text":"year, or such other method as the IRS may prescribe.","page_number":259,"box":{"x":116,"y":525,"width":404,"height":12}},{"id":"432507db-90d5-42c9-89e9-64b78d248bba","block_type":"box","text":"Exempt-interest dividends will be excludable from a shareholder’s gross income for U.S. federal","page_number":259,"box":{"x":117,"y":555,"width":714,"height":12}},{"id":"96838d88-7136-4384-90e3-92139429235a","block_type":"box","text":"income tax purposes. Exempt-interest dividends are included, however, in determining the portion, if","page_number":259,"box":{"x":117,"y":570,"width":748,"height":12}},{"id":"5f5e37d9-9e26-49d9-891b-ec3946df3712","block_type":"box","text":"any, of a person’s social security and railroad retirement benefits subject to U.S. federal income taxes.","page_number":259,"box":{"x":116,"y":586,"width":764,"height":12}},{"id":"7f2c344b-bdba-46d9-a18a-e0bb702014de","block_type":"box","text":"Interest on indebtedness incurred or continued to purchase or carry shares of a regulated investment","page_number":259,"box":{"x":117,"y":601,"width":754,"height":13}},{"id":"9f62f84c-c03d-4565-abea-073930d11685","block_type":"box","text":"company paying exempt-interest dividends, such as the Fund, will not be deductible by the investor for","page_number":259,"box":{"x":116,"y":617,"width":766,"height":12}},{"id":"04f6acfd-2c3e-4db0-ac5f-43bc26752ccb","block_type":"box","text":"U.S. federal income tax purposes to the extent attributable to exempt-interest dividends. Shareholders","page_number":259,"box":{"x":117,"y":632,"width":762,"height":12}},{"id":"0fb3602c-4d97-4b44-8602-0e7c5dd2b1c1","block_type":"box","text":"are advised to consult their tax advisors with respect to whether exempt-interest dividends retain the","page_number":259,"box":{"x":116,"y":648,"width":749,"height":12}},{"id":"dd5393ca-b5b9-4147-86bd-81a66802e7fc","block_type":"box","text":"exclusion under Code Section 103(a) if a shareholder would be treated as a “substantial user” or","page_number":259,"box":{"x":116,"y":663,"width":717,"height":13}},{"id":"f01c2c93-8526-437f-a5b2-4449c02ca5dd","block_type":"box","text":"“related person” under Code Section 147(a) with respect to property financed with the proceeds of an","page_number":259,"box":{"x":116,"y":679,"width":751,"height":12}},{"id":"51b8f928-10dd-4591-9ede-b78dfcd4f67f","block_type":"box","text":"issue of PABs, if any, held by a Fund.","page_number":259,"box":{"x":117,"y":694,"width":277,"height":13}},{"id":"5c63028d-1229-47c9-8bd5-acf502ae7878","block_type":"box","text":"Substitute payments received by a Fund representing interest paid on tax-exempt obligations loaned","page_number":259,"box":{"x":116,"y":724,"width":745,"height":12}},{"id":"9e8fc1c0-90ee-47f6-a452-913ba47ce595","block_type":"box","text":"out by the Fund will not be considered exempt interest, and distributions by the Fund of such substitute","page_number":259,"box":{"x":116,"y":740,"width":764,"height":12}},{"id":"01319d23-35f8-4d53-bab1-f7baf50f3d29","block_type":"box","text":"payments will not constitute exempt-interest dividends.","page_number":259,"box":{"x":117,"y":755,"width":404,"height":12}},{"id":"19e2efb0-4350-4d42-9c84-78ddf50658e2","block_type":"box","text":"Distributions in excess of a Fund’s earnings and profits will first reduce the adjusted tax basis of a","page_number":259,"box":{"x":117,"y":785,"width":722,"height":12}},{"id":"9a1a424c-7694-4bf0-8da0-872f19152556","block_type":"box","text":"holder’s shares and, after such adjusted tax basis is reduced to zero, will constitute capital gains to","page_number":259,"box":{"x":117,"y":800,"width":733,"height":12}},{"id":"2dcacac3-8135-4abc-8634-7e4f111e628d","block_type":"box","text":"such holder (assuming the shares are held as a capital asset). Any loss upon the sale or exchange of","page_number":259,"box":{"x":116,"y":816,"width":753,"height":12}},{"id":"a7c614b8-bb93-4f83-94c5-d91166bd00f2","block_type":"box","text":"Fund shares held for six months or less will be disallowed to the extent of any exempt-interest","page_number":259,"box":{"x":117,"y":831,"width":700,"height":12}},{"id":"9dc53420-09a3-4e3e-a1d8-f39fda2a9acf","block_type":"box","text":"dividends received by the shareholder. In addition, any such loss that is not disallowed under the rule","page_number":259,"box":{"x":116,"y":847,"width":756,"height":12}},{"id":"864652d5-5cf9-4933-a58e-17a5cf2c6b1d","block_type":"box","text":"stated above will be treated as long-term capital loss to the extent of any capital gain dividends","page_number":259,"box":{"x":116,"y":862,"width":709,"height":12}},{"id":"8a2be5e1-a9e2-44ed-9914-3e7e2d0904ec","block_type":"box","text":"received by the shareholder.","page_number":259,"box":{"x":117,"y":878,"width":216,"height":12}},{"id":"998f48fa-3361-4efd-a2ba-9d6ef6674ddb","block_type":"box","text":"II-172","page_number":259,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"9c477f2b-0a2a-42ea-98c9-e6dd7af2c862","block_type":"box","text":"NM1026U-6004382-259/605","page_number":259,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"2dfb0fae-d397-45d3-a7e8-fbb2427ba8ba","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","page_number":260,"box":{"x":116,"y":87,"width":764,"height":12}},{"id":"eec3303e-a5a5-455a-ae98-989bfc8c2315","block_type":"box","text":"market discount will be treated as ordinary income rather than capital gain. This rule may increase the","page_number":260,"box":{"x":117,"y":103,"width":760,"height":12}},{"id":"3d84f15a-3bba-415f-b025-a5af215eb521","block_type":"box","text":"amount of ordinary income dividends received by shareholders.","page_number":260,"box":{"x":116,"y":118,"width":477,"height":12}},{"id":"709403b4-f304-4595-ae74-193e2e7d0dfe","block_type":"box","text":"Any market discount recognized on a bond is taxable as ordinary income. A market discount bond is a","page_number":260,"box":{"x":116,"y":149,"width":763,"height":12}},{"id":"82261eb4-31e4-4536-ba6e-b6d2614f5c10","block_type":"box","text":"bond acquired in the secondary market at a price below redemption value or adjusted issue price if","page_number":260,"box":{"x":117,"y":165,"width":737,"height":12}},{"id":"3bb17cbf-0631-4c68-8838-8312f1dbf468","block_type":"box","text":"issued with original issue discount. Absent an election by the Fund to include the market discount in","page_number":260,"box":{"x":117,"y":180,"width":744,"height":12}},{"id":"ac64243c-1092-404a-b3c4-b62b3d417777","block_type":"box","text":"income as it accrues, gain on the Fund’s disposition of such an obligation will be treated as ordinary","page_number":260,"box":{"x":117,"y":196,"width":744,"height":12}},{"id":"1e0e37b1-30c5-4a8e-b964-dedb2de93e03","block_type":"box","text":"income rather than capital gain to the extent of the accrued market discount.","page_number":260,"box":{"x":117,"y":211,"width":571,"height":12}},{"id":"2196fe4c-9803-4b3d-a270-bf81f6ae050a","block_type":"box","text":"The Code subjects interest received on certain otherwise tax-exempt securities to a federal alternative","page_number":260,"box":{"x":116,"y":242,"width":763,"height":12}},{"id":"b79ee2da-40d3-4a4c-b732-111b9af8e0cc","block_type":"box","text":"minimum tax. The alternative minimum tax applies to interest received on certain “PABs” issued after","page_number":260,"box":{"x":117,"y":258,"width":753,"height":11}},{"id":"71943829-710e-4a66-9c5b-cb00fd241dc6","block_type":"box","text":"August 7, 1986. PABs are bonds that, although tax-exempt, are used for purposes other than those","page_number":260,"box":{"x":116,"y":273,"width":743,"height":12}},{"id":"c6d12dd4-f06c-4a38-9649-27d86f6420f8","block_type":"box","text":"generally performed by governmental units and that benefit non-governmental entities (","page_number":260,"box":{"x":116,"y":289,"width":648,"height":12}},{"id":"9d6e3fee-5e9c-4961-9161-2111d4432781","block_type":"box","text":"e.g.","page_number":260,"box":{"x":765,"y":291,"width":26,"height":10}},{"id":"389f7dac-197f-4546-abf9-7315b23b6cc4","block_type":"box","text":", bonds","page_number":260,"box":{"x":794,"y":289,"width":58,"height":11}},{"id":"4ea2e37c-cee3-47b3-9f1f-120e5f5197ef","block_type":"box","text":"used for industrial development or housing purposes). Income received on such bonds is classified as","page_number":260,"box":{"x":117,"y":304,"width":760,"height":12}},{"id":"e269f93d-6440-4030-9a5f-03102918178b","block_type":"box","text":"an item of “tax preference,” which could subject certain investors in such bonds, including shareholders","page_number":260,"box":{"x":116,"y":320,"width":771,"height":12}},{"id":"1d190239-a594-4fac-934b-dea0886d985a","block_type":"box","text":"of a Fund, to a federal alternative minimum tax. A Fund will purchase such “PABs” and will report to","page_number":260,"box":{"x":116,"y":335,"width":744,"height":12}},{"id":"491f34ef-e440-417a-8f55-e0ad24ad719e","block_type":"box","text":"shareholders after the close of the calendar year the portion of the Fund’s dividends declared during","page_number":260,"box":{"x":116,"y":351,"width":748,"height":12}},{"id":"e9ce00ff-134d-49fc-ae9a-772995b3344c","block_type":"box","text":"the year that constitute an item of tax preference for alternative minimum tax purposes.","page_number":260,"box":{"x":116,"y":366,"width":651,"height":12}},{"id":"46d70c88-c302-44ff-b0ea-b62feb4cfbf9","block_type":"box","text":"Each Municipal Fund may engage in interest rate swap transactions. The U.S. federal income tax rules","page_number":260,"box":{"x":117,"y":397,"width":768,"height":12}},{"id":"5017e0f4-ea0f-4dd5-bb5b-75cbf2b87771","block_type":"box","text":"governing the taxation of interest rate swaps are not entirely clear and may require a Fund to treat","page_number":260,"box":{"x":116,"y":413,"width":733,"height":12}},{"id":"66420006-7eae-4912-8726-f98a68d4bb85","block_type":"box","text":"payments received under such arrangements as ordinary income and to amortize payments made","page_number":260,"box":{"x":117,"y":428,"width":733,"height":12}},{"id":"82e350ce-152c-4d5f-9fbb-65c08944050c","block_type":"box","text":"under certain circumstances. Because payments received by a Fund in connection with swap","page_number":260,"box":{"x":117,"y":444,"width":697,"height":12}},{"id":"b9a4058d-5e79-41c6-b563-cb7fc3c1f872","block_type":"box","text":"transactions will be taxable rather than tax-exempt and because swap payments made by a Fund will","page_number":260,"box":{"x":116,"y":459,"width":757,"height":12}},{"id":"bbcb52b4-5fcb-4e9c-a3c4-7f51bf30a6ba","block_type":"box","text":"offset both taxable and tax-exempt gross income proportionately, they may result in increased taxable","page_number":260,"box":{"x":116,"y":475,"width":762,"height":12}},{"id":"a10cb010-eead-46d6-b416-cde379790cce","block_type":"box","text":"distributions to shareholders.","page_number":260,"box":{"x":116,"y":490,"width":220,"height":10}},{"id":"f0ffcf47-6414-4691-8604-757aba1bccd0","block_type":"box","text":"Please see Part I of your Fund’s SAI for certain state tax information relevant to an investment in","page_number":260,"box":{"x":117,"y":521,"width":721,"height":12}},{"id":"b921fe44-7239-4eb1-aa88-b1d44ea43195","block_type":"box","text":"BlackRock California Municipal Opportunities Fund, BlackRock New Jersey Municipal Bond Fund,","page_number":260,"box":{"x":117,"y":537,"width":731,"height":12}},{"id":"42613b1a-4a31-4fad-bd50-5fc321146e89","block_type":"box","text":"BlackRock New York Municipal Opportunities Fund and BlackRock Pennsylvania Municipal Bond","page_number":260,"box":{"x":117,"y":552,"width":725,"height":12}},{"id":"f14a3047-40f6-4dbe-b567-86f977d4c31a","block_type":"box","text":"Fund, as well as information on economic conditions within each applicable state.","page_number":260,"box":{"x":117,"y":568,"width":608,"height":12}},{"id":"816b2873-5ec4-435b-a616-fab44808f4a9","block_type":"box","text":"In the case of a Feeder Fund, such Fund is entitled to look to the underlying assets of the Master","page_number":260,"box":{"x":117,"y":599,"width":723,"height":12}},{"id":"02b1d8cd-25cb-42a0-99da-276e052eef74","block_type":"box","text":"Portfolio in which it has invested for purposes of satisfying various qualification requirements of the","page_number":260,"box":{"x":117,"y":614,"width":737,"height":12}},{"id":"4d7742d6-391b-47ef-a4f4-063bfc707680","block_type":"box","text":"Code applicable to regulated investment companies. Each Master Portfolio is classified either as a","page_number":260,"box":{"x":117,"y":630,"width":734,"height":12}},{"id":"81436aea-80c5-422a-b663-d8ad4ed56565","block_type":"box","text":"partnership or a separate disregarded entity (depending on the particular Master Portfolio) for U.S.","page_number":260,"box":{"x":117,"y":645,"width":734,"height":12}},{"id":"00fa80a7-c910-46c6-ae13-085996012c05","block_type":"box","text":"federal income tax purposes. If applicable tax provisions were to change the classification of a Master","page_number":260,"box":{"x":116,"y":661,"width":755,"height":12}},{"id":"601e7f42-a633-4dce-bc3a-3e7cc68bc0d9","block_type":"box","text":"Portfolio, then the Board of Directors of a Feeder Fund would determine, in its discretion, the","page_number":260,"box":{"x":117,"y":676,"width":686,"height":11}},{"id":"36d175a8-33bf-4cf0-90b4-453eef3aa2a3","block_type":"box","text":"appropriate course of action for the Feeder Fund. One possible course of action would be to withdraw","page_number":260,"box":{"x":116,"y":692,"width":755,"height":12}},{"id":"8d53a4ff-3d35-4a87-8db1-25f29ef80609","block_type":"box","text":"the Feeder Fund’s investments from the Master Portfolio and to retain an investment manager to","page_number":260,"box":{"x":116,"y":707,"width":717,"height":12}},{"id":"29368efd-747a-4312-8ede-b8bc9a55c202","block_type":"box","text":"manage the Feeder Fund’s assets in accordance with the investment policies applicable to the Feeder","page_number":260,"box":{"x":117,"y":723,"width":758,"height":12}},{"id":"dd99e176-ed6b-4f84-81d7-c82934d35429","block_type":"box","text":"Fund.","page_number":260,"box":{"x":117,"y":738,"width":40,"height":10}},{"id":"d8e1c2e6-4847-4045-90cc-7a2b98f23007","block_type":"box","text":"Ordinary income and capital gain dividends may also be subject to state and local taxes. Certain states","page_number":260,"box":{"x":116,"y":769,"width":764,"height":12}},{"id":"a8cb640f-84da-4d31-8bfa-262290da8e7a","block_type":"box","text":"exempt from state income taxation dividends paid by regulated investment companies that are derived","page_number":260,"box":{"x":116,"y":785,"width":759,"height":12}},{"id":"cea89eba-7874-42f9-a975-d3283238ae40","block_type":"box","text":"from interest on U.S. government obligations. State law varies as to whether dividend income","page_number":260,"box":{"x":116,"y":800,"width":693,"height":12}},{"id":"8f30b4f4-6be9-46c4-b25e-86d886c0a78b","block_type":"box","text":"attributable to U.S. government obligations is exempt from state income tax.","page_number":260,"box":{"x":116,"y":816,"width":563,"height":12}},{"id":"c240a06a-fcb2-48d3-8bb0-668196096aab","block_type":"box","text":"Shareholders of each Fund are urged to consult their tax advisers regarding specific questions as to","page_number":260,"box":{"x":116,"y":847,"width":747,"height":12}},{"id":"61565861-2504-4706-8db1-c02be1b4be31","block_type":"box","text":"federal, foreign, state or local taxes with respect to their Fund. Foreign investors should consider","page_number":260,"box":{"x":116,"y":862,"width":721,"height":12}},{"id":"4d8bc8ec-494c-420f-904a-9329fd20b167","block_type":"box","text":"applicable foreign taxes in their evaluation of an investment in a Fund.","page_number":260,"box":{"x":116,"y":878,"width":525,"height":12}},{"id":"d7e890bf-0223-4d3b-bc13-c6e319664425","block_type":"box","text":"II-173","page_number":260,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"1ce5b968-a812-4356-9bef-5bde3d29bfd7","block_type":"box","text":"NM1026U-6004382-260/605","page_number":260,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9e77600b-b53e-479d-9acf-3b16fc1ae788","block_type":"box","text":"The foregoing general discussion of U.S. federal income tax consequences is based on the Code and","page_number":261,"box":{"x":116,"y":87,"width":760,"height":12}},{"id":"0c96576c-4fe2-43d4-a3e9-0fe2b8295caa","block_type":"box","text":"the regulations issued thereunder as in effect on the date of this SAI. Future legislative or","page_number":261,"box":{"x":116,"y":102,"width":667,"height":13}},{"id":"242cdaff-bf5f-4648-a4f7-6b48701d90e3","block_type":"box","text":"administrative changes or court decisions may significantly change the conclusions expressed in this","page_number":261,"box":{"x":116,"y":118,"width":753,"height":12}},{"id":"2b036393-9c77-47ed-b237-9483ba5d5d3c","block_type":"box","text":"discussion, and any such changes or decisions may have a retroactive effect.","page_number":261,"box":{"x":116,"y":134,"width":581,"height":12}},{"id":"3a92f423-2bb5-418a-8986-0a317d46fecf","block_type":"box","text":"P","page_number":261,"box":{"x":424,"y":180,"width":9,"height":9}},{"id":"aad6a268-5a66-4130-b01c-99f6601dfaad","block_type":"box","text":"ERFORMANCE","page_number":261,"box":{"x":435,"y":182,"width":96,"height":8}},{"id":"ec072e6d-134f-4a90-9f4f-354b3168b53f","block_type":"box","text":"D","page_number":261,"box":{"x":531,"y":180,"width":17,"height":9}},{"id":"acf75487-9240-458d-aaa7-35815ca6d278","block_type":"box","text":"ATA","page_number":261,"box":{"x":548,"y":182,"width":28,"height":7}},{"id":"3fdd7fbb-8d54-41a6-96a0-744616b044af","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":261,"box":{"x":117,"y":211,"width":767,"height":12}},{"id":"c8c97e3a-2e1a-4686-9c0a-73a8534e156d","block_type":"box","text":"applicable, yield and tax-equivalent yield in advertisements or information furnished to present or","page_number":261,"box":{"x":116,"y":227,"width":723,"height":12}},{"id":"582e2664-53f0-48cf-a875-6dd935b37e8f","block_type":"box","text":"prospective shareholders. Total return, yield and tax-equivalent yield each is based on a Fund’s","page_number":261,"box":{"x":117,"y":242,"width":713,"height":12}},{"id":"25438ffb-ae0a-4e76-b19d-7813ce2613fd","block_type":"box","text":"historical performance and is not intended to indicate future performance. Average annual total return","page_number":261,"box":{"x":117,"y":258,"width":757,"height":12}},{"id":"b5e1967d-08b1-4d4e-9372-42d87113d355","block_type":"box","text":"is determined separately for each class of shares in accordance with a formula specified by the","page_number":261,"box":{"x":117,"y":273,"width":710,"height":12}},{"id":"93ad5525-5490-41af-8994-c5891f80c5bb","block_type":"box","text":"Commission.","page_number":261,"box":{"x":117,"y":289,"width":101,"height":9}},{"id":"8761c0e7-acbe-471f-9a36-c47b3a830f77","block_type":"box","text":"Quotations of average annual total return, before tax, for the specified periods are computed by finding","page_number":261,"box":{"x":116,"y":320,"width":767,"height":12}},{"id":"e2b095bd-c433-40a2-afd8-fde3be145c0f","block_type":"box","text":"the average annual compounded rates of return (based on net investment income and any realized","page_number":261,"box":{"x":116,"y":335,"width":741,"height":12}},{"id":"609dd070-d233-40f5-a29f-b0ad77167799","block_type":"box","text":"and unrealized capital gains or losses on portfolio investments over such periods) that would equate","page_number":261,"box":{"x":116,"y":351,"width":748,"height":12}},{"id":"c3cad05d-b178-4c8a-8336-130d46c5e59a","block_type":"box","text":"the initial amount invested to the redeemable value of such investment at the end of each period.","page_number":261,"box":{"x":116,"y":366,"width":725,"height":12}},{"id":"3e66ad43-078e-4bd3-93c7-1905232e7def","block_type":"box","text":"Average annual total return before taxes is computed assuming all dividends are reinvested and taking","page_number":261,"box":{"x":116,"y":382,"width":768,"height":12}},{"id":"d0a934fc-c3ac-401a-989e-c01c9dfc1cdf","block_type":"box","text":"into account all applicable recurring and nonrecurring expenses, including the maximum sales charge,","page_number":261,"box":{"x":117,"y":397,"width":762,"height":12}},{"id":"288f6967-d500-4e14-a561-cbc962b056b7","block_type":"box","text":"in the case of front-end load shares, and the CDSC that would be applicable to a complete redemption","page_number":261,"box":{"x":117,"y":413,"width":765,"height":12}},{"id":"b9d25d98-b1f5-439b-a6df-5fcaa8c6b93d","block_type":"box","text":"of the investment at the end of the specified period in the case of CDSC shares, but does not take into","page_number":261,"box":{"x":116,"y":428,"width":764,"height":12}},{"id":"7906dce6-4eb2-4a36-ab64-22618f94068e","block_type":"box","text":"account taxes payable on dividends or on redemption.","page_number":261,"box":{"x":116,"y":444,"width":408,"height":12}},{"id":"3a47cfed-10c2-4669-9cf8-2f4c074c4755","block_type":"box","text":"Quotations of average annual total return, after taxes, on dividends for the specified periods are","page_number":261,"box":{"x":116,"y":475,"width":715,"height":12}},{"id":"3d42e35c-126a-40bb-b5f4-08ccf635907d","block_type":"box","text":"computed by finding the average annual compounded rates of return that would equate the initial","page_number":261,"box":{"x":116,"y":490,"width":724,"height":12}},{"id":"2439ba58-c638-497b-a791-8dc190069aee","block_type":"box","text":"amount invested to the ending value of such investment at the end of each period assuming payment","page_number":261,"box":{"x":116,"y":506,"width":757,"height":12}},{"id":"45036b1f-3b94-48d0-b80e-07696c5eaf4b","block_type":"box","text":"of taxes on dividends received during such period. Average annual total return after taxes on dividends","page_number":261,"box":{"x":116,"y":521,"width":769,"height":12}},{"id":"40524d83-de2c-45e9-8763-373d6997f7b4","block_type":"box","text":"is computed assuming all dividends, less the taxes due on such dividends, are reinvested and taking","page_number":261,"box":{"x":117,"y":537,"width":751,"height":12}},{"id":"c6ec7a7f-f0a8-4e84-947d-8d2441ff743b","block_type":"box","text":"into account all applicable recurring and nonrecurring expenses, including the maximum sales charge,","page_number":261,"box":{"x":117,"y":552,"width":762,"height":12}},{"id":"63f8ff1f-4fec-4ef7-8838-1ef084561003","block_type":"box","text":"in the case of front-end load shares and the CDSC that would be applicable to a complete redemption","page_number":261,"box":{"x":117,"y":568,"width":760,"height":12}},{"id":"1a74fab1-d725-4853-a1b7-d9c23e889c6e","block_type":"box","text":"of the investment at the end of the specified period in the case of CDSC shares. The taxes due on","page_number":261,"box":{"x":116,"y":583,"width":733,"height":12}},{"id":"9eb6dc6d-4c88-44f8-a014-12dcd3e61cff","block_type":"box","text":"dividends are calculated by applying to each dividend the highest applicable marginal U.S. federal","page_number":261,"box":{"x":116,"y":599,"width":732,"height":12}},{"id":"38198f22-1a85-428f-ad50-a4e30ce76939","block_type":"box","text":"individual income tax rates in effect on the reinvestment date for that dividend. The rates used","page_number":261,"box":{"x":117,"y":614,"width":702,"height":10}},{"id":"22861148-4c03-445c-b6bc-340a6e1884eb","block_type":"box","text":"correspond to the tax character (including eligibility for the maximum 20% tax rate applicable to","page_number":261,"box":{"x":116,"y":630,"width":711,"height":12}},{"id":"e76ed2ed-29e0-4077-986f-b4a0f7ec88a7","block_type":"box","text":"qualified dividend income) of each dividend. The taxable amount and tax character of each dividend","page_number":261,"box":{"x":116,"y":645,"width":746,"height":12}},{"id":"d94f6864-d6b5-43e7-baf7-eff35a8155ec","block_type":"box","text":"are specified by each Fund on the dividend declaration date, but may be adjusted to reflect subsequent","page_number":261,"box":{"x":116,"y":661,"width":767,"height":12}},{"id":"9a7722aa-f174-4026-9a88-5bc6c1ab54b4","block_type":"box","text":"recharacterizations of distributions. The applicable tax rates may vary over the measurement period.","page_number":261,"box":{"x":117,"y":676,"width":743,"height":12}},{"id":"c2ce21b4-82ec-4770-b6a7-9906be41796c","block_type":"box","text":"The effects of state and local taxes are not reflected. Applicable tax credits, such as foreign credits, are","page_number":261,"box":{"x":116,"y":692,"width":766,"height":12}},{"id":"3759d9fc-b1da-4226-abbd-8602265e7974","block_type":"box","text":"taken into account according to U.S. federal tax law. The ending value is determined assuming","page_number":261,"box":{"x":116,"y":707,"width":703,"height":12}},{"id":"9e2bfede-fea6-4fe3-af17-c7db612d961a","block_type":"box","text":"complete redemption at the end of the applicable periods with no tax consequences associated with","page_number":261,"box":{"x":116,"y":723,"width":740,"height":12}},{"id":"cf35f127-def8-48da-852f-f884205b4d7e","block_type":"box","text":"such redemption.","page_number":261,"box":{"x":116,"y":738,"width":127,"height":12}},{"id":"96b10c5f-f808-42e5-aa9b-e70579cc1d95","block_type":"box","text":"Quotations of average annual total return, after taxes, on both dividends and redemption for the","page_number":261,"box":{"x":116,"y":769,"width":709,"height":12}},{"id":"abd453fa-c352-44bf-8493-7702c0860a8c","block_type":"box","text":"specified periods are computed by finding the average annual compounded rates of return that would","page_number":261,"box":{"x":116,"y":785,"width":751,"height":12}},{"id":"1c08e357-e528-4d9d-b55b-a227978c3d2c","block_type":"box","text":"equate the initial amount invested to the ending value of such investment at the end of each period","page_number":261,"box":{"x":116,"y":800,"width":732,"height":12}},{"id":"c0e6e53d-b40f-47b3-aca9-af73c3880fdb","block_type":"box","text":"assuming payment of taxes on dividends received during such period as well as on complete","page_number":261,"box":{"x":116,"y":816,"width":690,"height":12}},{"id":"d5df088a-e57e-4a84-8447-ba68db9a74d2","block_type":"box","text":"redemption. Average annual total return after taxes on distributions and redemption is computed","page_number":261,"box":{"x":117,"y":831,"width":718,"height":12}},{"id":"1f40f07a-f53d-40c6-b496-77986f48fb5b","block_type":"box","text":"assuming all dividends, less the taxes due on such dividends, are reinvested and taking into account","page_number":261,"box":{"x":116,"y":847,"width":752,"height":12}},{"id":"64f097e1-53bc-4953-8dd0-2de7a25c8f14","block_type":"box","text":"all applicable recurring and nonrecurring expenses, including the maximum sales charge in the case of","page_number":261,"box":{"x":116,"y":862,"width":768,"height":12}},{"id":"9afd8608-58e8-4eb7-b8bd-9da74ce45169","block_type":"box","text":"front-end load shares and the CDSC that would be applicable to a complete redemption of the","page_number":261,"box":{"x":116,"y":878,"width":703,"height":12}},{"id":"709912ad-96e3-448b-ba0f-dd61211cbfe7","block_type":"box","text":"II-174","page_number":261,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"f5b198f2-2ae5-4152-ab8f-582050b90af9","block_type":"box","text":"NM1026U-6004382-261/605","page_number":261,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"8b3bfd58-0f73-4873-998b-e86169eab1d7","block_type":"box","text":"investment at the end of the specified period in the case of CDSC shares and assuming, for all classes","page_number":262,"box":{"x":117,"y":87,"width":767,"height":12}},{"id":"e768c86a-e4b0-4f4e-bb2d-ed91658b4a60","block_type":"box","text":"of shares, complete redemption and payment of taxes due on such redemption. The ending value is","page_number":262,"box":{"x":116,"y":102,"width":746,"height":13}},{"id":"c7d90fbf-ad87-4781-a1f3-05b10ad00c17","block_type":"box","text":"determined assuming complete redemption at the end of the applicable periods, subtracting capital","page_number":262,"box":{"x":116,"y":118,"width":739,"height":12}},{"id":"6adefd09-a751-4b13-baa2-6d6532daded0","block_type":"box","text":"gains taxes resulting from the redemption and adding the presumed tax benefit from capital losses","page_number":262,"box":{"x":116,"y":134,"width":735,"height":12}},{"id":"0c9efd3f-9a36-46c5-8c41-0a9d5ecbe6f6","block_type":"box","text":"resulting from redemption. The taxes due on dividends and on the deemed redemption are calculated","page_number":262,"box":{"x":117,"y":149,"width":758,"height":12}},{"id":"70ff9ded-8b5b-44a3-9a87-9ea781bc42ae","block_type":"box","text":"by applying the highest applicable marginal U.S. federal individual income tax rates in effect on the","page_number":262,"box":{"x":117,"y":165,"width":737,"height":12}},{"id":"553442bb-0b50-4152-83b0-5bdfc7505c5a","block_type":"box","text":"reinvestment and/or the redemption date. The rates used correspond to the tax character (including","page_number":262,"box":{"x":117,"y":180,"width":743,"height":12}},{"id":"c8d418b8-3b1e-4d39-ba07-6b814d669ad6","block_type":"box","text":"eligibility for the maximum 20% tax rate applicable to qualified dividend income) of each component of","page_number":262,"box":{"x":116,"y":196,"width":762,"height":12}},{"id":"678857bd-b682-4ee4-917f-24a847fa35d3","block_type":"box","text":"each dividend and/or the redemption payment. The applicable tax rates may vary over the","page_number":262,"box":{"x":116,"y":211,"width":673,"height":12}},{"id":"83f592b8-a0ec-44f7-aa76-fe1e35501f10","block_type":"box","text":"measurement period. The effects of state and local taxes are not reflected. Applicable tax credits, such","page_number":262,"box":{"x":117,"y":227,"width":767,"height":11}},{"id":"d36f9375-702f-4193-b8f7-3ae7878d260d","block_type":"box","text":"as foreign tax credits, are taken into account according to federal law.","page_number":262,"box":{"x":116,"y":242,"width":522,"height":12}},{"id":"a3fa9cab-fc53-4248-8366-928354faaf6b","block_type":"box","text":"A Fund also may quote annual, average annual and annualized total return and aggregate total return","page_number":262,"box":{"x":116,"y":273,"width":760,"height":12}},{"id":"daf2a0d8-fc1b-48d3-b5f1-56b03e8b609e","block_type":"box","text":"performance data, both as a percentage and as a dollar amount based on a hypothetical investment of","page_number":262,"box":{"x":117,"y":289,"width":766,"height":12}},{"id":"e3a43436-4c6a-4ab1-8113-58a648138c2e","block_type":"box","text":"$1,000 or some other amount, for various periods other than those noted in Part I of each Fund’s SAI.","page_number":262,"box":{"x":116,"y":303,"width":761,"height":13}},{"id":"adc65134-0b63-4b7f-8e95-b396e2613ba7","block_type":"box","text":"Such data will be computed as described above, except that (1) as required by the periods of the","page_number":262,"box":{"x":116,"y":320,"width":724,"height":12}},{"id":"45f70c74-7982-46f5-a0a1-f248557620bf","block_type":"box","text":"quotations, actual annual, annualized or aggregate data, rather than average annual data, may be","page_number":262,"box":{"x":116,"y":335,"width":733,"height":12}},{"id":"b2f300b6-70c0-4208-844b-ab04003568de","block_type":"box","text":"quoted and (2) the maximum applicable sales charges will not be included with respect to annual or","page_number":262,"box":{"x":116,"y":351,"width":743,"height":12}},{"id":"d8839f76-282f-4057-9784-a41c7ea1dfaf","block_type":"box","text":"annualized rates of return calculations. Aside from the impact on the performance data calculations of","page_number":262,"box":{"x":116,"y":366,"width":760,"height":12}},{"id":"cef3a095-b348-4360-acce-f8e7c7ee269e","block_type":"box","text":"including or excluding the maximum applicable sales charges, actual annual or annualized total return","page_number":262,"box":{"x":117,"y":382,"width":760,"height":12}},{"id":"2313729d-5b6f-4f35-86c8-32e7088944d3","block_type":"box","text":"data generally will be lower than average annual total return data since the average rates of return","page_number":262,"box":{"x":116,"y":397,"width":734,"height":12}},{"id":"776a7ff4-dd6a-48db-8eec-c8f8bf0c3e23","block_type":"box","text":"reflect compounding of return; aggregate total return data generally will be higher than average annual","page_number":262,"box":{"x":117,"y":413,"width":764,"height":12}},{"id":"05122f11-35d6-4321-b559-615364619483","block_type":"box","text":"total return data since the aggregate rates of return reflect compounding over a longer period of time.","page_number":262,"box":{"x":116,"y":428,"width":755,"height":12}},{"id":"9b01d555-f01b-4e1c-924d-151db73b7095","block_type":"box","text":"Yield quotations will be computed based on a 30-day period by dividing (a) the net income based on","page_number":262,"box":{"x":116,"y":459,"width":748,"height":12}},{"id":"c8428e40-8f03-42a0-ac97-e1ef9641310f","block_type":"box","text":"the yield of each security earned during the period by (b) the average daily number of shares","page_number":262,"box":{"x":116,"y":475,"width":694,"height":12}},{"id":"1df7fe53-0d36-4f43-b637-b945bbde2989","block_type":"box","text":"outstanding during the period that were entitled to receive dividends multiplied by the maximum","page_number":262,"box":{"x":116,"y":490,"width":712,"height":12}},{"id":"73ed385a-331a-4b7a-bc0c-f1ed0a8455eb","block_type":"box","text":"offering price per share on the last day of the period. Tax equivalent yield quotations will be computed","page_number":262,"box":{"x":116,"y":506,"width":760,"height":12}},{"id":"d8021382-56fc-4909-8c2e-09cb5e6b91fc","block_type":"box","text":"by dividing (a) the part of a Fund’s yield that is tax-exempt by (b) one minus a stated tax rate and","page_number":262,"box":{"x":117,"y":521,"width":723,"height":12}},{"id":"5b651b92-9eee-4d7c-b9c3-d7d38a5d44f5","block_type":"box","text":"adding the result to that part, if any, of the Fund’s yield that is not tax-exempt.","page_number":262,"box":{"x":116,"y":537,"width":580,"height":12}},{"id":"9cdfafeb-334e-432c-afce-09b71e710889","block_type":"box","text":"A Fund’s total return will vary depending on market conditions, the securities comprising a Fund’s","page_number":262,"box":{"x":116,"y":568,"width":728,"height":12}},{"id":"5610e40e-fb37-4d05-9153-76b62762376c","block_type":"box","text":"portfolio, a Fund’s operating expenses and the amount of realized and unrealized net capital gains or","page_number":262,"box":{"x":117,"y":583,"width":754,"height":12}},{"id":"c39cc7d3-4428-4e54-8fa4-edfde34e5510","block_type":"box","text":"losses during the period. The value of an investment in a Fund will fluctuate and an investor’s shares,","page_number":262,"box":{"x":117,"y":599,"width":756,"height":12}},{"id":"14812449-f6ed-4904-94ba-16db0786b76c","block_type":"box","text":"when redeemed, may be worth more or less than their original cost.","page_number":262,"box":{"x":116,"y":614,"width":507,"height":12}},{"id":"7ef5c358-28d4-4265-a966-9da019860d6e","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","page_number":262,"box":{"x":117,"y":645,"width":750,"height":12}},{"id":"64872260-6426-423b-b9ec-f4b7dcd7d3b2","block_type":"box","text":"CDSC in the case of CDSC shares applicable to certain investors, as described under “Purchase of","page_number":262,"box":{"x":117,"y":661,"width":738,"height":12}},{"id":"c6791343-1c17-47a0-8d8c-7375a154b390","block_type":"box","text":"Shares” and “Redemption of Shares,” respectively, the total return data quoted by a Fund in","page_number":262,"box":{"x":116,"y":676,"width":681,"height":12}},{"id":"80d1ed76-872e-4924-b9c7-e62bd405d3c9","block_type":"box","text":"advertisements directed to such investors may take into account the reduced, and not the maximum,","page_number":262,"box":{"x":116,"y":692,"width":746,"height":12}},{"id":"c65b6964-1124-4810-ade3-603f9e6c4fbe","block_type":"box","text":"sales charge or may take into account the CDSC waiver and, therefore, may reflect greater total return","page_number":262,"box":{"x":116,"y":707,"width":761,"height":12}},{"id":"941a9eb6-628d-49ae-9a78-c2cc647bc42e","block_type":"box","text":"since, due to the reduced sales charges or the waiver of sales charges, a lower amount of expenses is","page_number":262,"box":{"x":116,"y":723,"width":762,"height":12}},{"id":"e98bc4f6-0971-4410-8805-8020071602b9","block_type":"box","text":"deducted.","page_number":262,"box":{"x":116,"y":738,"width":72,"height":10}},{"id":"1734ff82-4f51-49dd-81aa-d075ff95461c","block_type":"box","text":"On occasion, a Fund may compare its performance to, among other things, the Fund’s benchmark","page_number":262,"box":{"x":116,"y":769,"width":731,"height":12}},{"id":"559aa37b-0f8a-4164-b975-c18e0a90ab01","block_type":"box","text":"index indicated in the Prospectus, the Value Line Composite Index, the Dow Jones Industrial Average,","page_number":262,"box":{"x":117,"y":785,"width":758,"height":12}},{"id":"31c928cc-9bf8-4912-ae40-f24ee5b21d1d","block_type":"box","text":"or to other published indices, or to performance data published by Lipper Inc., Morningstar, Inc.","page_number":262,"box":{"x":116,"y":800,"width":706,"height":12}},{"id":"69a1788b-03fe-4359-84d4-b8a1ae586568","block_type":"box","text":"(“Morningstar”),","page_number":262,"box":{"x":117,"y":816,"width":113,"height":12}},{"id":"0620b999-bcd1-4d50-a749-c22d587adb71","block_type":"box","text":"Money Magazine, U.S. News & World Report, BusinessWeek, Forbes Magazine,","page_number":262,"box":{"x":237,"y":816,"width":600,"height":12}},{"id":"71ef73f8-3a45-42f4-91ac-0e7564414271","block_type":"box","text":"Fortune Magazine","page_number":262,"box":{"x":116,"y":831,"width":140,"height":12}},{"id":"c387094c-3962-41c0-83b1-415fa4e1c22a","block_type":"box","text":"or other industry publications. When comparing its performance to a market index, a","page_number":262,"box":{"x":257,"y":831,"width":629,"height":12}},{"id":"67981883-f5a0-447c-a928-e96a85e30539","block_type":"box","text":"Fund may refer to various statistical measures derived from the historical performance of a Fund and","page_number":262,"box":{"x":117,"y":847,"width":753,"height":12}},{"id":"1d9f205c-62a5-4b31-8373-4d25e86d242f","block_type":"box","text":"the index, such as standard deviation and beta. As with other performance data, performance","page_number":262,"box":{"x":116,"y":862,"width":700,"height":12}},{"id":"85b3e8b3-79fb-4fa1-9e5e-fadb2749ea6e","block_type":"box","text":"comparisons should not be considered indicative of a Fund’s relative performance for any future","page_number":262,"box":{"x":116,"y":878,"width":717,"height":12}},{"id":"1883220f-66fc-4ba5-ac34-2651a35abb86","block_type":"box","text":"II-175","page_number":262,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"8eda445f-718a-4226-b852-2649c20ae7a8","block_type":"box","text":"NM1026U-6004382-262/605","page_number":262,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"46508f98-4743-4bcb-8bb9-494b9ab4d3bd","block_type":"box","text":"period. In addition, from time to time a Fund may include the Fund’s Morningstar risk-adjusted","page_number":263,"box":{"x":117,"y":87,"width":701,"height":12}},{"id":"c2a3bd78-c3b7-4372-84ce-121a80c56511","block_type":"box","text":"performance ratings assigned by Morningstar in advertising or supplemental sales literature. From time","page_number":263,"box":{"x":117,"y":102,"width":769,"height":13}},{"id":"fd138579-56d9-40f9-9818-04cb1c63e69a","block_type":"box","text":"to time a Fund may quote in advertisements or other materials other applicable measures of Fund","page_number":263,"box":{"x":116,"y":118,"width":732,"height":12}},{"id":"81ce485a-535d-4296-8b38-a7d6562d5b63","block_type":"box","text":"performance and may also make reference to awards that may be given to the Manager. Certain","page_number":263,"box":{"x":117,"y":134,"width":721,"height":12}},{"id":"1127307e-09eb-4bf8-b987-8dab87bfe562","block_type":"box","text":"Funds may also compare their performance to composite indices developed by Fund management.","page_number":263,"box":{"x":117,"y":149,"width":742,"height":12}},{"id":"784543f4-9770-4a37-8734-be97d22436b1","block_type":"box","text":"A Fund may provide information designed to help investors understand how the Fund is seeking to","page_number":263,"box":{"x":116,"y":180,"width":737,"height":12}},{"id":"ca84c613-af40-4958-b851-2bc9868ee32c","block_type":"box","text":"achieve its investment objectives. This may include information about past, current or possible","page_number":263,"box":{"x":116,"y":196,"width":704,"height":12}},{"id":"fc7f0be5-28e4-49c8-abea-040efdb7517d","block_type":"box","text":"economic, market, political or other conditions, descriptive information or general principles of investing","page_number":263,"box":{"x":116,"y":211,"width":770,"height":12}},{"id":"e2af94ca-22d0-4c9e-8b9d-8745af190ab9","block_type":"box","text":"such as asset allocation, diversification and risk tolerance, discussion of a Fund’s portfolio composition,","page_number":263,"box":{"x":116,"y":227,"width":771,"height":11}},{"id":"efdb0b6b-478b-4310-9d65-0236c2059c0c","block_type":"box","text":"investment philosophy, strategy or investment techniques, comparisons of the Fund’s performance or","page_number":263,"box":{"x":117,"y":242,"width":757,"height":12}},{"id":"426146c1-ada7-424f-9ee0-b22549c14b16","block_type":"box","text":"portfolio composition to that of other funds or types of investments, indices relevant to the comparison","page_number":263,"box":{"x":117,"y":258,"width":760,"height":12}},{"id":"3e4c321e-c77b-4465-811e-c1688a66080b","block_type":"box","text":"being made, or to a hypothetical or model portfolio. A Fund may also quote various measures of","page_number":263,"box":{"x":117,"y":273,"width":716,"height":12}},{"id":"d2626c7e-06d4-47d4-a6d1-937a86992f5c","block_type":"box","text":"volatility and benchmark correlation in advertising and other materials, and may compare these","page_number":263,"box":{"x":116,"y":289,"width":711,"height":12}},{"id":"03a34b6f-30af-4e32-a764-b0afa2f36c17","block_type":"box","text":"measures to those of other funds or types of investments.","page_number":263,"box":{"x":117,"y":304,"width":432,"height":12}},{"id":"40413452-abb5-40d8-91fd-e6f96d6e08c1","block_type":"box","text":"P","page_number":263,"box":{"x":342,"y":351,"width":10,"height":9}},{"id":"c1bdb9fc-3f00-488b-a72f-4ee66b4000f4","block_type":"box","text":"ROXY","page_number":263,"box":{"x":353,"y":353,"width":38,"height":7}},{"id":"d9de4280-57a5-403e-8bc6-a0f27372d1ee","block_type":"box","text":"Y V","page_number":263,"box":{"x":391,"y":351,"width":16,"height":9}},{"id":"8756e28d-1b4d-4c66-adaf-8ec1841aebeb","block_type":"box","text":"OTING","page_number":263,"box":{"x":407,"y":353,"width":42,"height":7}},{"id":"ba150f74-7d00-43dd-8007-d71de62f5154","block_type":"box","text":"P","page_number":263,"box":{"x":450,"y":351,"width":15,"height":9}},{"id":"25034bcf-d5c6-4d7a-9f34-37f40cabec8e","block_type":"box","text":"OLICIES","page_number":263,"box":{"x":467,"y":353,"width":53,"height":7}},{"id":"7b5bbd0b-d13a-4d33-bdc9-1625536ee45a","block_type":"box","text":"AND","page_number":263,"box":{"x":525,"y":353,"width":29,"height":7}},{"id":"14e2cd35-90d6-4df4-88f4-a73c752be1e4","block_type":"box","text":"P","page_number":263,"box":{"x":555,"y":351,"width":15,"height":9}},{"id":"1ba354ef-bc3e-4413-a6f4-e1d44c967b39","block_type":"box","text":"ROCEDURES","page_number":263,"box":{"x":572,"y":353,"width":85,"height":7}},{"id":"04231e53-7be3-4cfa-8387-c9f8e49d1071","block_type":"box","text":"The Board of Directors of the Funds has delegated the voting of proxies for the Funds’ securities to the","page_number":263,"box":{"x":116,"y":382,"width":768,"height":12}},{"id":"3448fb68-54d5-444f-b8b2-1c20d5544217","block_type":"box","text":"Manager pursuant to (i) the Open-End Active and Fixed Income Index Fund Proxy Voting Policy (the","page_number":263,"box":{"x":117,"y":397,"width":749,"height":12}},{"id":"f89504e5-86db-473c-9c3c-d50629d04e5e","block_type":"box","text":"“Active Fund Proxy Voting Policy”), with respect to certain Funds, and (ii) the Index Equity Fund Proxy","page_number":263,"box":{"x":116,"y":413,"width":761,"height":12}},{"id":"c15fe265-170f-498c-b3a4-8cc3ac22c96b","block_type":"box","text":"Voting Policy, with respect to certain other Funds, as applicable. Please refer to Part I of this SAI,","page_number":263,"box":{"x":116,"y":428,"width":727,"height":12}},{"id":"9398b3d6-87f1-4f5e-accd-48e12eaa2beb","block_type":"box","text":"which discloses the policy applicable to each Fund.","page_number":263,"box":{"x":116,"y":444,"width":385,"height":12}},{"id":"17736b65-3d85-4455-8057-76b138cd1cfe","block_type":"box","text":"With respect to Funds covered by the Active Fund Proxy Voting Policy, the Manager has adopted the","page_number":263,"box":{"x":116,"y":475,"width":756,"height":12}},{"id":"52250f2c-759b-4c73-99ab-74ff3528ea6d","block_type":"box","text":"BlackRock Active Investment Stewardship — Global Engagement and Voting Guidelines (the “BAIS","page_number":263,"box":{"x":117,"y":490,"width":744,"height":12}},{"id":"b132492c-b08c-4f58-8a36-00cc2dae7818","block_type":"box","text":"Guidelines”). Certain of such Funds, as listed within the Active Fund Proxy Voting Policy and as","page_number":263,"box":{"x":117,"y":506,"width":713,"height":12}},{"id":"90553bc3-564a-4b57-8a98-5525b5a32460","block_type":"box","text":"disclosed in Part I of this SAI, follow supplemental guidelines within the BAIS Guidelines that are","page_number":263,"box":{"x":116,"y":521,"width":721,"height":12}},{"id":"fec4f820-ca3c-458c-98b7-535bd4c602b0","block_type":"box","text":"applicable to certain climate and decarbonization issues (the “BAIS Climate and Decarbonization","page_number":263,"box":{"x":116,"y":537,"width":724,"height":12}},{"id":"9e3df884-f157-42eb-8a32-1e54b4660d3e","block_type":"box","text":"Stewardship Guidelines”).","page_number":263,"box":{"x":116,"y":552,"width":197,"height":12}},{"id":"40c718a2-8b7c-44c4-ac28-7029d5ded4cf","block_type":"box","text":"With respect to Funds covered by the Index Equity Fund Proxy Voting Policy, the Manager has","page_number":263,"box":{"x":116,"y":583,"width":709,"height":12}},{"id":"d741a96f-749e-436a-82c8-285556f91631","block_type":"box","text":"adopted the BlackRock Investment Stewardship (“BIS”) Global Benchmark Policy, comprised of the","page_number":263,"box":{"x":116,"y":599,"width":743,"height":12}},{"id":"69f54094-2eb5-46ee-a27f-62fa5f5f0426","block_type":"box","text":"Global Principles for Benchmark Policies, regional voting guidelines, and engagement priorities, which","page_number":263,"box":{"x":117,"y":614,"width":762,"height":12}},{"id":"9be1bb7b-4dd9-43da-83c7-4934bf51565f","block_type":"box","text":"are each available upon request. In addition, certain of such Funds, as listed within the Index Equity","page_number":263,"box":{"x":116,"y":630,"width":745,"height":12}},{"id":"925794a8-1329-4195-9e47-3921d38a677f","block_type":"box","text":"Fund Proxy Voting Policy and as disclosed in Part I of this SAI, follow supplemental guidelines that are","page_number":263,"box":{"x":117,"y":645,"width":765,"height":12}},{"id":"98542df4-01d3-4aea-b8d2-632859fc8e52","block_type":"box","text":"applicable to certain climate and decarbonization issues (the “BIS Climate and Decarbonization","page_number":263,"box":{"x":116,"y":661,"width":707,"height":12}},{"id":"a2a2b7e0-52ec-4b06-8dae-c340163b47a9","block_type":"box","text":"Stewardship Guidelines”).","page_number":263,"box":{"x":116,"y":676,"width":191,"height":12}},{"id":"88fdf0dd-500b-45af-ae2c-5c6cdf6f00b7","block_type":"box","text":"If a Fund invests in an underlying fund managed by BlackRock, the Fund will use its proxy voting policy","page_number":263,"box":{"x":117,"y":707,"width":765,"height":12}},{"id":"6cf972a2-a710-4839-9cfc-2121fc6f349e","block_type":"box","text":"when voting on proxies for the underlying fund while the underlying fund will use its proxy voting policy","page_number":263,"box":{"x":116,"y":723,"width":759,"height":12}},{"id":"69d563c1-224d-4871-ac4b-0e2af5979255","block_type":"box","text":"when voting proxies on investments the underlying fund holds. Therefore, the Fund may use the Active","page_number":263,"box":{"x":116,"y":738,"width":764,"height":12}},{"id":"dc0d3c7f-9833-46f4-b003-e7aaf012ee08","block_type":"box","text":"Fund Proxy Voting Policy while an underlying fund may use the Index Equity Fund Proxy Voting Policy,","page_number":263,"box":{"x":117,"y":754,"width":762,"height":12}},{"id":"0fe17390-02a0-42e6-b143-3f1b8fecc0e7","block_type":"box","text":"and the opposite is also true.","page_number":263,"box":{"x":116,"y":769,"width":213,"height":12}},{"id":"2e959c9e-0f65-41b5-a08d-aba055fecb81","block_type":"box","text":"Copies of the Active Fund Proxy Voting Policy, Index Equity Fund Proxy Voting Policy, the BAIS","page_number":263,"box":{"x":117,"y":800,"width":711,"height":12}},{"id":"2a23f067-9d4e-4a26-ba52-5b3aaf65f3d6","block_type":"box","text":"Guidelines, the Global Principles for Benchmark Policies and the BIS Climate and Decarbonization","page_number":263,"box":{"x":117,"y":816,"width":731,"height":12}},{"id":"153ed565-f425-42fa-9ae1-533b03ee124b","block_type":"box","text":"Stewardship Guidelines are attached as Appendix B to this SAI. Only those guidelines that are","page_number":263,"box":{"x":116,"y":831,"width":706,"height":12}},{"id":"aa54beb1-f98d-4123-a46d-9290405575da","block_type":"box","text":"applicable to a particular Fund pursuant to the Active Fund Proxy Voting Policy or the Index Equity","page_number":263,"box":{"x":116,"y":847,"width":735,"height":12}},{"id":"204b60ba-c7a3-4d4c-934b-5f58467cd2d9","block_type":"box","text":"Fund Proxy Voting Policy are considered to form a part of the Fund’s SAI.","page_number":263,"box":{"x":117,"y":862,"width":551,"height":12}},{"id":"a5e3d864-6f3f-4336-a17f-b21b2076f99a","block_type":"box","text":"II-176","page_number":263,"box":{"x":479,"y":909,"width":41,"height":9}},{"id":"032754cb-4dfd-4a5f-9b30-5f7d52a08ec2","block_type":"box","text":"NM1026U-6004382-263/605","page_number":263,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"edcafb32-d67e-4cdf-9dd9-608e67d1988c","block_type":"box","text":"Information on how each Fund voted proxies relating to portfolio securities during the most","page_number":264,"box":{"x":117,"y":87,"width":645,"height":12}},{"id":"63209128-e864-4a3f-bb5c-1dce4d8c48ff","block_type":"box","text":"recent 12-month period ended June 30 is available without","page_number":264,"box":{"x":117,"y":103,"width":416,"height":11}},{"id":"a3c10125-3a11-4eaa-a005-ded65d8aac8b","block_type":"box","text":"t charge, (i) at www.blackrock.com/proxyrecords","page_number":264,"box":{"x":532,"y":102,"width":344,"height":13}},{"id":"1e755f07-2fa8-4a8d-aeef-3e6e8f947772","block_type":"box","text":"and (ii) on the Commission’s website at http://www.sec.gov.","page_number":264,"box":{"x":116,"y":118,"width":428,"height":12}},{"id":"6f2479d6-fbdb-432a-9ac0-2847b133c608","block_type":"box","text":"G","page_number":264,"box":{"x":415,"y":165,"width":11,"height":9}},{"id":"0fa4e99c-0d7c-4055-a5f8-c5faba1791ba","block_type":"box","text":"ENERAL","page_number":264,"box":{"x":428,"y":167,"width":55,"height":7}},{"id":"ed7d4953-092f-4a64-8876-f86148701124","block_type":"box","text":"I","page_number":264,"box":{"x":483,"y":165,"width":8,"height":9}},{"id":"e68c06f2-3313-46eb-80c5-e2596b80021f","block_type":"box","text":"NFORMATION","page_number":264,"box":{"x":494,"y":167,"width":90,"height":7}},{"id":"aaca37ad-7846-40fd-847e-c7e30987dfa3","block_type":"box","text":"Description of Shares","page_number":264,"box":{"x":117,"y":196,"width":177,"height":11}},{"id":"0a289040-80dd-48b8-809a-bd5a5001b53d","block_type":"box","text":"Shareholders of a Fund are entitled to one vote for each full share held and fractional votes for","page_number":264,"box":{"x":116,"y":219,"width":706,"height":9}},{"id":"1a3f3d00-4874-40bb-ab08-eecd1316514e","block_type":"box","text":"fractional shares held in the election of Directors and generally on other matters submitted to the vote","page_number":264,"box":{"x":116,"y":234,"width":758,"height":12}},{"id":"3157e944-ed5a-4222-be29-be9decd34230","block_type":"box","text":"of shareholders of the Fund. Shareholders of a class that bears distribution and/or service expenses","page_number":264,"box":{"x":116,"y":250,"width":748,"height":12}},{"id":"b1f4a1fe-be78-430d-bb38-405059102841","block_type":"box","text":"have exclusive voting rights with respect to matters relating to such distribution and service","page_number":264,"box":{"x":117,"y":265,"width":679,"height":12}},{"id":"6d463818-79df-4961-b6ba-41da2e930884","block_type":"box","text":"expenditures. Voting rights are not cumulative, so that the holders of more than 50% of the shares","page_number":264,"box":{"x":116,"y":281,"width":734,"height":12}},{"id":"dc36cacb-9043-4a02-b1e8-f20ba8cb5510","block_type":"box","text":"voting in the election of Directors can, if they choose to do so, elect all the Directors of a Fund, in which","page_number":264,"box":{"x":116,"y":296,"width":771,"height":12}},{"id":"9580e3df-516a-4f71-8d50-33f15e127e10","block_type":"box","text":"event the holders of the remaining shares would be unable to elect any person as a Director.","page_number":264,"box":{"x":116,"y":312,"width":693,"height":12}},{"id":"99ab33b0-203f-44d1-8349-7db1a7024fc3","block_type":"box","text":"No Fund intends to hold annual meetings of shareholders in any year in which the Investment","page_number":264,"box":{"x":117,"y":343,"width":698,"height":12}},{"id":"caf0d1f2-0917-4bf4-88da-98763377224f","block_type":"box","text":"Company Act does not require shareholders to act upon any of the following matters: (i) election of","page_number":264,"box":{"x":117,"y":358,"width":736,"height":12}},{"id":"7394c8ab-8d9f-4152-ae31-b30693a7daf6","block_type":"box","text":"Directors; (ii) approval of a management agreement; (iii) approval of a distribution agreement; and","page_number":264,"box":{"x":117,"y":374,"width":732,"height":12}},{"id":"664ebd1e-252d-4311-ac0e-9c5c66fdc148","block_type":"box","text":"(iv) ratification of selection of independent accountants. Shares issued are fully paid and","page_number":264,"box":{"x":117,"y":389,"width":658,"height":12}},{"id":"12c2bb86-63e9-4827-abff-3e0c7802f8b1","block_type":"box","text":"non-assessable and have no preemptive rights. Redemption and conversion rights are discussed","page_number":264,"box":{"x":117,"y":405,"width":726,"height":12}},{"id":"bf21799b-0944-40fe-8a2e-98a4231f124e","block_type":"box","text":"elsewhere herein and in each Fund’s Prospectus. Each share of each class of Common Stock is","page_number":264,"box":{"x":116,"y":420,"width":721,"height":12}},{"id":"fde57b08-09ce-4705-8fa0-9b6d7266232d","block_type":"box","text":"entitled to participate equally in dividends and distributions declared by a Fund and in the net assets of","page_number":264,"box":{"x":116,"y":436,"width":766,"height":12}},{"id":"6a1739a5-68e1-49f8-803a-22018754b1ac","block_type":"box","text":"the Fund upon liquidation or dissolution after satisfaction of outstanding liabilities.","page_number":264,"box":{"x":116,"y":451,"width":608,"height":12}},{"id":"8f98de52-3276-4679-b937-79e328578c9b","block_type":"box","text":"For Funds organized as Maryland corporations, the by-laws of the Fund require that a special meeting","page_number":264,"box":{"x":117,"y":482,"width":762,"height":12}},{"id":"000f07de-df0a-4459-a9d9-ba426db62d23","block_type":"box","text":"of shareholders be held upon the written request of a minimum percentage of the outstanding shares","page_number":264,"box":{"x":116,"y":498,"width":754,"height":12}},{"id":"16bf746a-3115-4856-abd9-09bdbe7be3df","block_type":"box","text":"of the Fund entitled to vote at such meeting, if they comply with applicable Maryland law.","page_number":264,"box":{"x":116,"y":513,"width":663,"height":12}},{"id":"00d20076-95ad-4b43-ae9f-9af67ab5ff6f","block_type":"box","text":"Certain of the Funds are organized as “Massachusetts business trusts.” Under Massachusetts law,","page_number":264,"box":{"x":117,"y":544,"width":738,"height":12}},{"id":"56448a3c-660e-4e2b-9d21-8cd999e79653","block_type":"box","text":"shareholders of such a trust may, under certain circumstances, be held personally liable as partners for","page_number":264,"box":{"x":116,"y":560,"width":772,"height":12}},{"id":"dcd6c81e-d799-47fd-b922-d14681512118","block_type":"box","text":"its obligations. However, the Declaration of Trust establishing a trust, a copy of which for each","page_number":264,"box":{"x":117,"y":575,"width":701,"height":12}},{"id":"c42ae804-d9cb-4f3e-a2c9-0187cc10346c","block_type":"box","text":"applicable Fund, together with all amendments thereto (the “Declaration of Trust”), is on file in the","page_number":264,"box":{"x":116,"y":591,"width":729,"height":12}},{"id":"cacffb17-b774-46ee-a17e-b0e2b07f2eea","block_type":"box","text":"office of the Secretary of the Commonwealth of Massachusetts, contains an express disclaimer of","page_number":264,"box":{"x":116,"y":606,"width":731,"height":12}},{"id":"0ba467db-36e9-4473-93c9-f9789f91513d","block_type":"box","text":"shareholder liability for acts or obligations of the trust and provides for indemnification and","page_number":264,"box":{"x":116,"y":622,"width":672,"height":12}},{"id":"e32da512-2f05-4013-ad5e-cbe63a755879","block_type":"box","text":"reimbursement of expenses out of the trust property for any shareholder held personally liable for the","page_number":264,"box":{"x":117,"y":637,"width":754,"height":12}},{"id":"909c883d-eb1c-4fd2-a9fb-dc1fe3782dbe","block_type":"box","text":"obligations of the trust. The Declaration of Trust also provides that a trust may maintain appropriate","page_number":264,"box":{"x":116,"y":653,"width":742,"height":12}},{"id":"e35ce3f2-673e-4bce-adbf-ae0e5bc1b2ed","block_type":"box","text":"insurance (for example, fidelity bond and errors and omissions insurance) for the protection of the trust,","page_number":264,"box":{"x":117,"y":668,"width":765,"height":12}},{"id":"35919f07-bd95-48aa-b5dd-d9484f6322a0","block_type":"box","text":"its shareholders, trustees, officers, employees and agents covering possible tort and other liabilities.","page_number":264,"box":{"x":117,"y":684,"width":740,"height":12}},{"id":"942b0221-dd76-451f-9a88-aa67ad64257e","block_type":"box","text":"Thus, the risk of a shareholder incurring financial loss on account of shareholder liability is limited to","page_number":264,"box":{"x":116,"y":699,"width":740,"height":13}},{"id":"096fa23b-22eb-41bb-abd2-602316ef6e67","block_type":"box","text":"circumstances in which both inadequate insurance existed and the trust itself was unable to meet its","page_number":264,"box":{"x":116,"y":715,"width":743,"height":12}},{"id":"59bf9995-4f70-4d25-846f-4538384cd2b1","block_type":"box","text":"obligations.","page_number":264,"box":{"x":116,"y":731,"width":83,"height":12}},{"id":"5b5281ea-a5de-4297-8886-4e6b6caaa5ea","block_type":"box","text":"Certain Funds are organized as Delaware statutory trusts.","page_number":264,"box":{"x":117,"y":761,"width":428,"height":13}},{"id":"c0788fc1-54af-45dd-a97c-5d6aa6fccf56","block_type":"box","text":"Additional Information","page_number":264,"box":{"x":116,"y":792,"width":178,"height":10}},{"id":"f57a7d43-b8c0-4065-aab6-4fbbdb596862","block_type":"box","text":"Under a separate agreement, BlackRock has granted certain Funds the right to use the “BlackRock”","page_number":264,"box":{"x":117,"y":816,"width":742,"height":12}},{"id":"25e573c1-3827-47ad-8997-4a7a5e2c4f05","block_type":"box","text":"name and has reserved the right to (i) withdraw its consent to the use of such name by a Fund if the","page_number":264,"box":{"x":117,"y":831,"width":746,"height":12}},{"id":"c3cf6f58-666b-41a3-9752-e02a55d795f2","block_type":"box","text":"Fund ceases to retain BlackRock Advisors, LLC or BlackRock Fund Advisors, as applicable, as","page_number":264,"box":{"x":117,"y":847,"width":709,"height":12}},{"id":"b6b1fb8c-86d9-4ed6-a025-2d74da6baadf","block_type":"box","text":"investment adviser and (ii) to grant the use of such name to any other company.","page_number":264,"box":{"x":117,"y":862,"width":599,"height":12}},{"id":"63b26092-10f4-4593-b3f9-9745cf05c7ef","block_type":"box","text":"II-177","page_number":264,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"a9f13020-d935-4e85-9d84-fe1ba8ec2ee9","block_type":"box","text":"NM1026U-6004382-264/605","page_number":264,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b4057bde-6fb4-48b8-b3d6-b26d39d9ed99","block_type":"box","text":"Appendix A","page_number":265,"box":{"x":453,"y":87,"width":98,"height":12}},{"id":"b68915a5-21fe-43e3-966b-60b4fc0879ed","block_type":"box","text":"Description of Bond Ratings","page_number":265,"box":{"x":387,"y":118,"width":231,"height":12}},{"id":"78b6d0c5-6066-4082-a782-b3d5b8a5baf3","block_type":"box","text":"A rating is generally assigned to a fixed-income security at the time of issuance by a credit rating","page_number":265,"box":{"x":116,"y":149,"width":722,"height":12}},{"id":"931a554b-aa43-4421-b55c-906fb1f47bf8","block_type":"box","text":"agency designated as a nationally recognized statistical rating organization (“NRSRO”) by the SEC.","page_number":265,"box":{"x":116,"y":165,"width":744,"height":12}},{"id":"782b2f26-08f4-4e10-a04b-ce8ac1fc5b25","block_type":"box","text":"While NRSROs may from time to time revise such ratings, they undertake no obligation to do so, and","page_number":265,"box":{"x":116,"y":180,"width":755,"height":12}},{"id":"716070aa-c3f4-433e-8cf1-ad61a294bc4f","block_type":"box","text":"the ratings given to securities at issuance do not necessarily represent ratings which would be given to","page_number":265,"box":{"x":116,"y":196,"width":767,"height":12}},{"id":"f1c160c4-8acf-4902-83bf-78c78b1dd09d","block_type":"box","text":"these securities on a particular subsequent date.","page_number":265,"box":{"x":116,"y":211,"width":366,"height":12}},{"id":"be57ecc4-8e12-40ac-86d1-bbc91e69f85b","block_type":"box","text":"NRSROs may rate specific investments (e.g., bonds), issuers (e.g., corporations, governments and","page_number":265,"box":{"x":117,"y":242,"width":740,"height":12}},{"id":"c8b73dc6-6480-489c-abd5-3bedbf60d189","block_type":"box","text":"financial institutions) and/or programs (e.g., commercial paper programs). However, certain types of","page_number":265,"box":{"x":116,"y":258,"width":747,"height":12}},{"id":"da213d37-c822-4620-95e9-f33e1dfad812","block_type":"box","text":"investments may not be rated by NRSROs, such as certain government/sovereign obligations, US","page_number":265,"box":{"x":117,"y":273,"width":732,"height":12}},{"id":"f5de4de9-d3f7-43bd-bb37-a860da7764bf","block_type":"box","text":"agency securities, commercial paper, time deposits at financial institutions, and derivative instruments","page_number":265,"box":{"x":116,"y":289,"width":761,"height":12}},{"id":"f7fdd703-ae2c-4a13-836e-15deca45f222","block_type":"box","text":"such as credit default swaps. For these types of investments, as well as US Treasury securities (some","page_number":265,"box":{"x":116,"y":304,"width":764,"height":12}},{"id":"0414b40b-4dd3-42e7-91c3-8259d258ea93","block_type":"box","text":"of which are not rated), where a NRSRO has not rated the specific investment but has rated the","page_number":265,"box":{"x":116,"y":320,"width":716,"height":12}},{"id":"d727e67b-039f-42f1-99f0-2b620286c2b1","block_type":"box","text":"investment’s issuer, program, financial institution or underlying reference asset, BlackRock Advisors,","page_number":265,"box":{"x":117,"y":335,"width":751,"height":12}},{"id":"67959d98-fcfa-4aae-8aad-c5cdc01fc648","block_type":"box","text":"LLC, BlackRock Fund Advisors or their respective affiliates (“BlackRock”) may consider the investment","page_number":265,"box":{"x":117,"y":351,"width":766,"height":12}},{"id":"faf8b023-4b17-4496-bf4a-d0cb9c3d88b2","block_type":"box","text":"to have the same NRSRO rating as its issuer, program, financial institution or underlying reference","page_number":265,"box":{"x":116,"y":366,"width":736,"height":12}},{"id":"4829b1ac-efa1-4d64-b42b-b77cd65e418c","block_type":"box","text":"asset, as applicable. In the case of municipal securities, where one NRSRO provides multiple ratings","page_number":265,"box":{"x":116,"y":382,"width":754,"height":12}},{"id":"49259c9c-d2f1-4aeb-90ee-64bfc271d432","block_type":"box","text":"for the same security (e.g., “underlying,” “insured” and/or “enhanced” ratings), BlackRock may consider","page_number":265,"box":{"x":116,"y":397,"width":770,"height":12}},{"id":"9a9ad159-048a-4558-bf03-83d5071a1762","block_type":"box","text":"the security to have the highest of the multiple ratings.","page_number":265,"box":{"x":116,"y":413,"width":407,"height":12}},{"id":"8f0b78c7-323f-452a-80a8-0e0659a02a1c","block_type":"box","text":"New issue securities (regardless of type) may not be rated by a NRSRO at the time of their initial","page_number":265,"box":{"x":117,"y":444,"width":722,"height":12}},{"id":"9985f712-c06c-4917-9a69-84807e944251","block_type":"box","text":"offering. Preliminary prospectuses or term sheets for new issue securities may include an expected","page_number":265,"box":{"x":116,"y":459,"width":742,"height":12}},{"id":"a42a9569-933a-441e-b461-0dfa794dce6c","block_type":"box","text":"rating for the security (as determined by the underwriter and/or issuer) or a NRSRO rating for the","page_number":265,"box":{"x":117,"y":475,"width":723,"height":12}},{"id":"a994a53c-b118-472d-8ddf-bfc59aba9a8d","block_type":"box","text":"issuer of the security. If applicable, when deciding whether to purchase a new issue security that has","page_number":265,"box":{"x":117,"y":490,"width":752,"height":12}},{"id":"39a91008-9723-4ba9-9449-65a4033b9ff8","block_type":"box","text":"not yet been rated by a NRSRO, BlackRock may attribute an expected rating to the security based on:","page_number":265,"box":{"x":117,"y":506,"width":763,"height":12}},{"id":"f69cd81e-8ffd-403a-b561-0ca46ab32833","block_type":"box","text":"(i) the expected rating of the security set forth in the preliminary prospectus or term sheet for the","page_number":265,"box":{"x":117,"y":521,"width":718,"height":12}},{"id":"d58cc1d7-9e5f-45bf-ba43-1d4b11a5fdc9","block_type":"box","text":"security; (ii) the NRSRO’s rating for the issuer of the security set forth in the preliminary prospectus or","page_number":265,"box":{"x":116,"y":537,"width":760,"height":12}},{"id":"fdf7c37c-c596-4ccb-885c-30dbc34567bc","block_type":"box","text":"term sheet for the security; or (iii) with respect to asset-backed securities, the rating of a prior issuance","page_number":265,"box":{"x":116,"y":552,"width":767,"height":12}},{"id":"d14f3a00-07ad-4cf5-acbb-c4b709b00aa4","block_type":"box","text":"having a similar structure or the same sponsor.","page_number":265,"box":{"x":117,"y":568,"width":353,"height":12}},{"id":"80cb3506-0cef-452a-95fe-40766fceb9b7","block_type":"box","text":"Where the investment objective of a fund is to track the performance of an index that includes credit","page_number":265,"box":{"x":116,"y":599,"width":746,"height":12}},{"id":"c5f71766-d47b-43c3-a97a-d819ac3f11d3","block_type":"box","text":"ratings eligibility criteria as part of its index methodology, the fund may purchase any security within the","page_number":265,"box":{"x":117,"y":614,"width":771,"height":12}},{"id":"4eedc655-fa87-4ab2-a9c8-f51813c38576","block_type":"box","text":"index, such security having been determined by the index provider as meeting its credit ratings","page_number":265,"box":{"x":117,"y":630,"width":707,"height":12}},{"id":"88a39115-ce18-4ed4-9ad7-7f91c5ebc937","block_type":"box","text":"eligibility criteria. The credit ratings practices of an index provider may differ from BlackRock’s","page_number":265,"box":{"x":116,"y":645,"width":701,"height":12}},{"id":"55d38e43-877b-4539-a46e-96fd230cb346","block_type":"box","text":"practices, as described above. Further, the fund may invest, directly or indirectly, in securities that are","page_number":265,"box":{"x":117,"y":661,"width":754,"height":12}},{"id":"f224c273-4040-4691-bc87-d1542efbbf53","block_type":"box","text":"not rated by a rating agency or securities with a credit rating that differs from the credit rating specified","page_number":265,"box":{"x":117,"y":676,"width":757,"height":12}},{"id":"74ea8e0f-1925-434e-b849-9e38a0d07b13","block_type":"box","text":"in its index methodology in various circumstances, including where a security is downgraded but not","page_number":265,"box":{"x":117,"y":692,"width":741,"height":12}},{"id":"21bb3ef5-517d-46ab-b146-0498a5077e16","block_type":"box","text":"yet removed from an index, following the removal of a security from an index prior to its sale by the","page_number":265,"box":{"x":116,"y":707,"width":733,"height":12}},{"id":"115bb1b8-150e-421b-8338-55461955146d","block_type":"box","text":"fund or as a result of a corporate action or restructuring affecting an issuer of a security held by the","page_number":265,"box":{"x":116,"y":723,"width":734,"height":12}},{"id":"40e2a4cc-72b1-406c-8757-34b3e8779b97","block_type":"box","text":"fund.","page_number":265,"box":{"x":116,"y":738,"width":36,"height":10}},{"id":"58a5c176-c42f-4075-b70c-664b97ed5890","block_type":"box","text":"Fixed-income securities which are unrated may expose the investor to risks with respect to capacity to","page_number":265,"box":{"x":117,"y":769,"width":757,"height":12}},{"id":"ebd328de-f874-4e18-9793-629126c5bbde","block_type":"box","text":"pay interest or repay principal which are similar to the risks of lower-rated speculative bonds.","page_number":265,"box":{"x":117,"y":785,"width":686,"height":12}},{"id":"1972df5e-ec6a-4551-b7a0-dfcc28bd3949","block_type":"box","text":"Evaluation of these securities is dependent on BlackRock’s judgment, analysis and experience in the","page_number":265,"box":{"x":117,"y":800,"width":747,"height":12}},{"id":"d7f673b9-cca4-4446-b95c-f0e6355354e1","block_type":"box","text":"evaluation of such securities.","page_number":265,"box":{"x":116,"y":816,"width":214,"height":9}},{"id":"5535db1a-baf3-4c1c-88e2-d35762852e4a","block_type":"box","text":"Investors should note that the assignment of a rating to a security by an NRSRO may not reflect the","page_number":265,"box":{"x":117,"y":847,"width":745,"height":12}},{"id":"be57e532-cfff-4b32-a66c-059d93801f92","block_type":"box","text":"effect of recent developments on the issuer’s ability to make interest and principal payments or on the","page_number":265,"box":{"x":116,"y":862,"width":760,"height":12}},{"id":"79915c82-591b-426d-b47b-0839e78e72f5","block_type":"box","text":"likelihood of default.","page_number":265,"box":{"x":117,"y":878,"width":152,"height":9}},{"id":"dbb31479-863e-4673-a97b-e302a225bcf6","block_type":"box","text":"A-1","page_number":265,"box":{"x":486,"y":909,"width":24,"height":9}},{"id":"59df0c2d-9dc1-4b45-aecf-437d31f8ef0f","block_type":"box","text":"NM1026U-6004382-265/605","page_number":265,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"42c8ff60-0a55-4675-aca9-656ee3fc9bfb","block_type":"box","text":"Securities deemed to be high yield are rated below Baa3 by Moody’s and below BBB- by S&P Global","page_number":266,"box":{"x":116,"y":87,"width":755,"height":12}},{"id":"9996188c-3ec6-402d-b80a-64552811882e","block_type":"box","text":"Ratings and Fitch.","page_number":266,"box":{"x":117,"y":103,"width":139,"height":12}},{"id":"b2bfd670-b490-43c1-9ab8-fe081b73c63a","block_type":"box","text":"The descriptions below relate to general long-term and short-term obligations of an issuer.","page_number":266,"box":{"x":116,"y":134,"width":674,"height":12}},{"id":"a3352d78-b9bb-49bb-ab7c-4bcca185a605","block_type":"box","text":"A Description of Moody’s Investors Service, Inc.’s (“Moody’s”) Global Rating Scales","page_number":266,"box":{"x":116,"y":165,"width":677,"height":12}},{"id":"1ecb78b5-c398-43f4-830c-6436d18c9f5e","block_type":"box","text":"Ratings assigned on Moody’s global long-term and short-term rating scales are forward-looking","page_number":266,"box":{"x":117,"y":196,"width":711,"height":12}},{"id":"91a6b0f1-a24c-4c71-8762-ebd557649a77","block_type":"box","text":"opinions of the relative credit risks of financial obligations issued by non-financial corporates, financial","page_number":266,"box":{"x":116,"y":211,"width":759,"height":12}},{"id":"83810c27-ee4c-4d17-8e81-f539b98f0a5f","block_type":"box","text":"institutions, structured finance vehicles, project finance vehicles, and public sector entities. Moody’s","page_number":266,"box":{"x":117,"y":227,"width":742,"height":12}},{"id":"d83484b4-b6c5-489d-98db-2ed350a920a5","block_type":"box","text":"defines credit risk as the risk that an entity may not meet its contractual financial obligations as they","page_number":266,"box":{"x":116,"y":242,"width":744,"height":12}},{"id":"16d11a8e-ec40-4fe0-8a93-5a4e1a588a57","block_type":"box","text":"come due and any estimated financial loss in the event of default or impairment. The contractual","page_number":266,"box":{"x":116,"y":258,"width":720,"height":12}},{"id":"26009c74-73e4-4a1d-8cce-20da91d77e77","block_type":"box","text":"financial obligations addressed by Moody’s ratings are those that call for, without regard to","page_number":266,"box":{"x":116,"y":273,"width":676,"height":12}},{"id":"ff9ea435-f6d1-43d8-be4b-127af69f5369","block_type":"box","text":"enforceability, the payment of an ascertainable amount, which may vary based upon standard sources","page_number":266,"box":{"x":116,"y":289,"width":765,"height":12}},{"id":"3ae97258-141e-4c80-9c16-0a103498a21e","block_type":"box","text":"of variation (e.g., floating interest rates), by an ascertainable date. Moody’s rating addresses the","page_number":266,"box":{"x":116,"y":304,"width":719,"height":12}},{"id":"97c4265a-e3fd-457e-931f-d4c28998eb90","block_type":"box","text":"issuer’s ability to obtain cash sufficient to service the obligation, and its willingness to pay. Moody’s","page_number":266,"box":{"x":117,"y":320,"width":738,"height":12}},{"id":"1fa1b074-d1ce-4481-8adb-db6cb58869a7","block_type":"box","text":"ratings do not address non-standard sources of variation in the amount of the principal obligation (e.g.,","page_number":266,"box":{"x":117,"y":335,"width":765,"height":12}},{"id":"e5207bb0-9660-426b-b50b-3f41ee8d29d8","block_type":"box","text":"equity indexed), absent an express statement to the contrary in a press release accompanying an","page_number":266,"box":{"x":116,"y":351,"width":731,"height":12}},{"id":"b80d1f08-5861-40d4-b478-f0b196056b37","block_type":"box","text":"initial rating. Long-term ratings are assigned to issuers or obligations with an original maturity of one","page_number":266,"box":{"x":117,"y":366,"width":745,"height":12}},{"id":"dfb379a3-abd1-4c63-9ce2-8b0bae804d2b","block_type":"box","text":"year or more and reflect both on the likelihood of a default or impairment on contractual financial","page_number":266,"box":{"x":116,"y":382,"width":719,"height":12}},{"id":"01b42337-41c9-4d05-bcc9-c0bac830562f","block_type":"box","text":"obligations and the expected financial loss suffered in the event of default or impairment. Short-term","page_number":266,"box":{"x":116,"y":397,"width":747,"height":12}},{"id":"04e2a897-25d9-4e45-8b9d-c8d38d3aec05","block_type":"box","text":"ratings are assigned for obligations with an original maturity of thirteen months or less and reflect both","page_number":266,"box":{"x":117,"y":413,"width":760,"height":12}},{"id":"965c9f65-f8fc-4091-a9ae-22ce7bb8ac53","block_type":"box","text":"on the likelihood of a default or impairment on contractual financial obligations and the expected","page_number":266,"box":{"x":116,"y":428,"width":717,"height":12}},{"id":"d0d31b43-f9b4-4a90-950d-77bb6eb61378","block_type":"box","text":"financial loss suffered in the event of default or impairment. Moody’s issues ratings at the issuer level","page_number":266,"box":{"x":116,"y":444,"width":755,"height":12}},{"id":"e6a5f68e-17d2-4bf3-8c31-889a86c7d27e","block_type":"box","text":"and instrument level on both the long-term scale and the short-term scale. Typically, ratings are made","page_number":266,"box":{"x":116,"y":459,"width":761,"height":12}},{"id":"3b93a481-7772-4b59-beac-fb509ec52dee","block_type":"box","text":"publicly available although private and unpublished ratings may also be assigned.","page_number":266,"box":{"x":117,"y":475,"width":610,"height":12}},{"id":"623b0f49-af16-4009-96fa-c142e0f4fa2d","block_type":"box","text":"Moody’s differentiates structured finance ratings from fundamental ratings (i.e., ratings on nonfinancial","page_number":266,"box":{"x":117,"y":506,"width":763,"height":12}},{"id":"186a947c-d22b-4c78-8f22-e690f25d68b1","block_type":"box","text":"corporate, financial institution, and public sector entities) on the global long-term scale by adding (sf) to","page_number":266,"box":{"x":116,"y":521,"width":769,"height":12}},{"id":"a55dddbd-fee3-40d3-bf06-cea78b978d0a","block_type":"box","text":"all structured finance ratings. The addition of (sf) to structured finance ratings should eliminate any","page_number":266,"box":{"x":116,"y":537,"width":735,"height":12}},{"id":"c1556796-9472-4e99-99cc-8ea3162a4177","block_type":"box","text":"presumption that such ratings and fundamental ratings at the same letter grade level will behave the","page_number":266,"box":{"x":117,"y":552,"width":747,"height":12}},{"id":"d1ef0183-8954-472f-af50-8100c909bbef","block_type":"box","text":"same. The (sf) indicator for structured finance security ratings indicates that otherwise similarly rated","page_number":266,"box":{"x":116,"y":568,"width":751,"height":12}},{"id":"240b287d-0367-4c8b-9f3e-c3078a44e857","block_type":"box","text":"structured finance and fundamental securities may have different risk characteristics. Through its","page_number":266,"box":{"x":116,"y":583,"width":724,"height":12}},{"id":"a7312d23-653d-481a-a823-f0b5cdf5e0ae","block_type":"box","text":"current methodologies, however, Moody’s aspires to achieve broad expected equivalence in structured","page_number":266,"box":{"x":116,"y":599,"width":769,"height":12}},{"id":"1bcf261d-9297-436f-9ae4-a7d663b735ed","block_type":"box","text":"finance and fundamental rating performance when measured over a long period of time.","page_number":266,"box":{"x":116,"y":614,"width":658,"height":12}},{"id":"3df34e2b-f9fe-413a-8f0f-cc94044991fa","block_type":"box","text":"Description of Moody’s Global Long-Term Rating Scale","page_number":266,"box":{"x":117,"y":645,"width":445,"height":12}},{"id":"d6435490-08c9-4a56-915c-83c67b2b5597","block_type":"box","text":"Aaa Obligations rated Aaa are judged to be of the highest quality, subject to the lowest level of","page_number":266,"box":{"x":116,"y":676,"width":726,"height":12}},{"id":"1e6f2713-8a04-41bf-bdec-fcf9b7d51743","block_type":"box","text":"credit risk.","page_number":266,"box":{"x":175,"y":692,"width":75,"height":9}},{"id":"91c56c3f-8bc6-40b1-b390-976f451c84ea","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":266,"box":{"x":116,"y":715,"width":731,"height":12}},{"id":"50d87ab8-7cc5-404b-9260-d7b178da94b0","block_type":"box","text":"A Obligations rated A are judged to be upper-medium grade and are subject to low credit risk.","page_number":266,"box":{"x":116,"y":738,"width":737,"height":12}},{"id":"d5b17779-74ee-44cf-afb0-e5ef43c3f441","block_type":"box","text":"Baa Obligations rated Baa are judged to be medium-grade and subject to moderate credit risk and","page_number":266,"box":{"x":117,"y":761,"width":753,"height":13}},{"id":"a5db0f3b-527b-4469-8943-b6109a281be1","block_type":"box","text":"as such may possess certain speculative characteristics.","page_number":266,"box":{"x":175,"y":777,"width":420,"height":12}},{"id":"a4c46f1c-ec97-4c10-8a5f-0bde7bd72aea","block_type":"box","text":"Ba Obligations rated Ba are judged to be speculative and are subject to substantial credit risk.","page_number":266,"box":{"x":117,"y":800,"width":729,"height":12}},{"id":"a067019f-c031-4cd6-9f4e-6d74532b55e2","block_type":"box","text":"B Obligations rated B are considered speculative and are subject to high credit risk.","page_number":266,"box":{"x":117,"y":823,"width":660,"height":13}},{"id":"9284307c-8ca4-4156-a1b6-6c5636d68e8d","block_type":"box","text":"Caa Obligations rated Caa are judged to be speculative of poor standing and are subject to very","page_number":266,"box":{"x":117,"y":847,"width":741,"height":12}},{"id":"30fe528b-c4b2-4d12-b956-71273dcfda00","block_type":"box","text":"high credit risk.","page_number":266,"box":{"x":176,"y":862,"width":116,"height":12}},{"id":"0f20830b-559c-4547-800d-cf432c7dce00","block_type":"box","text":"A-2","page_number":266,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"a661e16a-717d-4c5c-842b-df07aa523906","block_type":"box","text":"NM1026U-6004382-266/605","page_number":266,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"07ea132e-d135-4079-af50-fd59871d5035","block_type":"box","text":"Ca Obligations rated Ca are highly speculative and are likely in, or very near, default, with some","page_number":267,"box":{"x":117,"y":87,"width":748,"height":12}},{"id":"f694e810-207f-4784-8a0a-d356734cb853","block_type":"box","text":"prospect of recovery of principal and interest.","page_number":267,"box":{"x":176,"y":102,"width":339,"height":13}},{"id":"1d60aaa6-8278-40dd-bdf0-62f8ec7f2991","block_type":"box","text":"C Obligations rated C are the lowest rated and are typically in default, with little prospect for","page_number":267,"box":{"x":117,"y":126,"width":726,"height":12}},{"id":"49131785-ac80-49e9-bed3-7f51cb5d1510","block_type":"box","text":"recovery of principal or interest.","page_number":267,"box":{"x":176,"y":141,"width":238,"height":12}},{"id":"a0133c4a-535c-4a06-b3ab-ca89639ff71f","block_type":"box","text":"Note","page_number":267,"box":{"x":117,"y":172,"width":34,"height":10}},{"id":"e5357556-6b12-405a-874e-755606b6dc0c","block_type":"box","text":": Moody’s appends numerical modifiers 1, 2, and 3 to each generic rating classification from Aa","page_number":267,"box":{"x":153,"y":172,"width":709,"height":12}},{"id":"1eabeb73-d54b-423f-8ed2-6b1a562cbd25","block_type":"box","text":"through Caa. The modifier 1 indicates that the obligation ranks in the higher end of its generic rating","page_number":267,"box":{"x":116,"y":188,"width":745,"height":12}},{"id":"395fe5b9-0fc5-443f-8a06-8a9fb0987ba1","block_type":"box","text":"category; the modifier 2 indicates a mid-range ranking; and the modifier 3 indicates a ranking in the","page_number":267,"box":{"x":116,"y":203,"width":741,"height":12}},{"id":"541c952d-81ad-4696-90c7-964f76e57767","block_type":"box","text":"lower end of that generic rating category. Additionally, a “(hyb)” indicator is appended to all ratings of","page_number":267,"box":{"x":117,"y":219,"width":751,"height":12}},{"id":"8433c559-c20b-40c7-8df4-0e481c3c0689","block_type":"box","text":"hybrid securities issued by banks, insurers, finance companies, and securities firms.","page_number":267,"box":{"x":117,"y":234,"width":628,"height":12}},{"id":"4943a946-c22c-4715-8b51-c3f2ee8f7e2a","block_type":"box","text":"By their terms, hybrid securities allow for the omission of scheduled dividends, interest, or principal","page_number":267,"box":{"x":117,"y":265,"width":737,"height":12}},{"id":"410def79-c8f4-44f8-a1de-c30439e64abf","block_type":"box","text":"payments, which can potentially result in impairment if such an omission occurs. Hybrid securities may","page_number":267,"box":{"x":117,"y":281,"width":765,"height":12}},{"id":"0780fd90-5467-4297-8a2d-24f8e75972ad","block_type":"box","text":"also be subject to contractually allowable write-downs of principal that could result in impairment.","page_number":267,"box":{"x":116,"y":296,"width":724,"height":12}},{"id":"6d3efab4-0b6f-4cda-86c3-49e4c524349a","block_type":"box","text":"Together with the hybrid indicator, the long-term obligation rating assigned to a hybrid security is an","page_number":267,"box":{"x":116,"y":312,"width":744,"height":12}},{"id":"1a944319-074d-4f1f-b286-2e4bad649ddd","block_type":"box","text":"expression of the relative credit risk associated with that security.","page_number":267,"box":{"x":116,"y":327,"width":488,"height":12}},{"id":"e5f17608-6361-4c29-aa62-b8808f060336","block_type":"box","text":"Description of Moody’s Global Short-Term Rating Scale","page_number":267,"box":{"x":117,"y":358,"width":448,"height":12}},{"id":"dbaf2d02-e3ea-4116-a3a8-c1d626cc10da","block_type":"box","text":"P-1 Ratings of Prime-1 reflect a superior ability to repay short-term obligations.","page_number":267,"box":{"x":117,"y":389,"width":616,"height":12}},{"id":"5df9c9b0-59ef-4b15-8200-8f144fbd1b56","block_type":"box","text":"P-2 Ratings of Prime-2 reflect a strong ability to repay short-term obligations.","page_number":267,"box":{"x":117,"y":413,"width":602,"height":12}},{"id":"504dd1b3-9802-4116-ab4b-1e7b3488d4ac","block_type":"box","text":"P-3 Ratings of Prime-3 reflect an acceptable ability to repay short-term obligations.","page_number":267,"box":{"x":117,"y":436,"width":646,"height":12}},{"id":"1bff7aa0-9ee4-41e1-87a2-6adecf99299a","block_type":"box","text":"NP Issuers (or supporting institutions) rated Not Prime do not fall within any of the Prime rating","page_number":267,"box":{"x":117,"y":459,"width":737,"height":12}},{"id":"37cea30d-3613-4725-b163-10964a1bdc0e","block_type":"box","text":"categories.","page_number":267,"box":{"x":175,"y":475,"width":87,"height":12}},{"id":"a1eb0223-e4e1-4b31-abd2-a0354220456d","block_type":"box","text":"Description of Moody’s U.S. Municipal Short-Term Debt and Demand Obligation Ratings","page_number":267,"box":{"x":117,"y":506,"width":707,"height":12}},{"id":"8302311b-a5de-48c7-ad53-4752d1f79a02","block_type":"box","text":"Description of Moody’s Short-Term Obligation Ratings","page_number":267,"box":{"x":117,"y":537,"width":439,"height":12}},{"id":"c1d52abe-b4bd-4044-ab84-d181d1b5d383","block_type":"box","text":"Moody’s uses the global short-term Prime rating scale for commercial paper issued by U.S.","page_number":267,"box":{"x":117,"y":568,"width":681,"height":12}},{"id":"5b310446-0efa-4344-9d46-1ab160330b40","block_type":"box","text":"municipalities and nonprofits. These commercial paper programs may be backed by external letters of","page_number":267,"box":{"x":117,"y":583,"width":761,"height":12}},{"id":"fb88f176-6ce9-44b5-97c3-006aa2c8590c","block_type":"box","text":"credit or liquidity facilities, or by an issuer’s self-liquidity.","page_number":267,"box":{"x":116,"y":599,"width":420,"height":12}},{"id":"06ab7ae6-15d1-4f29-bef6-9352884d70dd","block_type":"box","text":"For other short-term municipal obligations, Moody’s uses one of two other short-term rating scales, the","page_number":267,"box":{"x":117,"y":630,"width":765,"height":12}},{"id":"c948e954-febb-4ad9-a14d-a74c3d3cc469","block_type":"box","text":"Municipal Investment Grade (“MIG”) and Variable Municipal Investment Grade (“VMIG”) scales","page_number":267,"box":{"x":117,"y":645,"width":708,"height":12}},{"id":"d396375e-434e-40a6-b40a-9a7e5e7a71e4","block_type":"box","text":"discussed below.","page_number":267,"box":{"x":116,"y":661,"width":126,"height":9}},{"id":"5dd77052-62c8-4541-b482-b1d8fa570e7b","block_type":"box","text":"Moody’s uses the MIG scale for U.S. municipal cash flow notes, bond anticipation notes and certain","page_number":267,"box":{"x":117,"y":692,"width":738,"height":12}},{"id":"1f380c13-2078-4568-90f9-45a475600d13","block_type":"box","text":"other short-term obligations, which typically mature in three years or less. Under certain circumstances,","page_number":267,"box":{"x":116,"y":707,"width":766,"height":12}},{"id":"c8a4a39d-769d-42e1-8c87-7668b89d5f37","block_type":"box","text":"Moody’s uses the MIG scale for bond anticipation notes with maturities of up to five years.","page_number":267,"box":{"x":117,"y":723,"width":665,"height":12}},{"id":"cc9ebeb8-5c7e-405b-a942-a4b928265754","block_type":"box","text":"MIG Scale","page_number":267,"box":{"x":117,"y":754,"width":77,"height":9}},{"id":"151a4136-ef89-4800-b33e-d2ed2c0a7d77","block_type":"box","text":"MIG 1 This designation denotes superior credit quality. Excellent protection is afforded by established","page_number":267,"box":{"x":117,"y":785,"width":760,"height":12}},{"id":"455c20af-becd-483a-8ec6-721a7d6289e3","block_type":"box","text":"cash flows, highly reliable liquidity support, or demonstrated broad-based access to the market","page_number":267,"box":{"x":175,"y":800,"width":703,"height":12}},{"id":"b427aeb8-067c-4c17-be64-9487bda92230","block_type":"box","text":"for refinancing.","page_number":267,"box":{"x":175,"y":816,"width":110,"height":12}},{"id":"3440e305-ff07-4800-840a-dad8bc7e173a","block_type":"box","text":"MIG 2 This designation denotes strong credit quality. Margins of protection are ample, although not as","page_number":267,"box":{"x":117,"y":839,"width":771,"height":12}},{"id":"0dbbd379-2b4a-4003-b221-61ee004bd6be","block_type":"box","text":"large as in the preceding group.","page_number":267,"box":{"x":176,"y":855,"width":240,"height":12}},{"id":"f370eb15-0d21-41e3-9136-c728f8b0de63","block_type":"box","text":"A-3","page_number":267,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"df33d079-6cf8-4e08-85b9-d03b0b75d668","block_type":"box","text":"NM1026U-6004382-267/605","page_number":267,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ef07b4e4-2597-41d0-8c16-739a88f2b008","block_type":"box","text":"MIG 3 This designation denotes acceptable credit quality. Liquidity and cash-flow protection may be","page_number":268,"box":{"x":117,"y":87,"width":753,"height":12}},{"id":"cec29572-a60e-4a28-afcb-1965f5da9f15","block_type":"box","text":"narrow, and market access for refinancing is likely to be less well-established.","page_number":268,"box":{"x":176,"y":102,"width":582,"height":13}},{"id":"69c92d57-c16e-40d8-9b77-46871cacbc30","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Debt instruments in this category","page_number":268,"box":{"x":116,"y":126,"width":741,"height":12}},{"id":"76066bf2-8117-4dff-9c6f-c0eb2d51b100","block_type":"box","text":"may lack sufficient margins of protection.","page_number":268,"box":{"x":176,"y":141,"width":307,"height":12}},{"id":"3b742b64-979c-4d1b-a993-bba96a136edd","block_type":"box","text":"Description of Moody’s Demand Obligation Ratings","page_number":268,"box":{"x":117,"y":172,"width":415,"height":12}},{"id":"91c75c16-b131-4e63-805b-08790f1801f3","block_type":"box","text":"In the case of variable rate demand obligations (“VRDOs”), a two-component rating is assigned. The","page_number":268,"box":{"x":117,"y":203,"width":749,"height":12}},{"id":"24f7befb-17bc-44d6-a86d-f5120a130b34","block_type":"box","text":"components are a long-term rating and a short-term demand obligation rating. The long-term rating","page_number":268,"box":{"x":116,"y":219,"width":740,"height":12}},{"id":"4c299564-5d55-45ad-8494-e2791b13d2b3","block_type":"box","text":"addresses the issuer’s ability to meet scheduled principal and interest payments. The short-term","page_number":268,"box":{"x":116,"y":234,"width":719,"height":12}},{"id":"74f96f87-e174-4e51-9d17-aa585e2c6f1d","block_type":"box","text":"demand obligation rating addresses the ability of the issuer or the liquidity provider to make payments","page_number":268,"box":{"x":116,"y":250,"width":759,"height":12}},{"id":"76a6752f-3d20-44f1-b10a-8e2e87ae4bb3","block_type":"box","text":"associated with the purchase-price-upon-demand feature (“demand feature”) of the VRDO. The short","page_number":268,"box":{"x":116,"y":265,"width":756,"height":12}},{"id":"17fd2506-e02d-4df6-b99b-586e1b4f0c66","block_type":"box","text":"term demand obligation rating uses the VMIG scale. VMIG ratings with liquidity support use as an input","page_number":268,"box":{"x":116,"y":281,"width":770,"height":12}},{"id":"136240b0-c652-4fcb-b11d-efec912d4809","block_type":"box","text":"the short-term Counterparty Risk Assessment of the support provider, or the long-term rating of the","page_number":268,"box":{"x":116,"y":296,"width":740,"height":12}},{"id":"100b48c0-11b8-45f6-b573-382674e20fcb","block_type":"box","text":"underlying obligor in the absence of third party liquidity support. Transitions of VMIG ratings of demand","page_number":268,"box":{"x":117,"y":312,"width":768,"height":12}},{"id":"cd14b897-e3cd-4c43-9ca3-36c41ed359f5","block_type":"box","text":"obligations with conditional liquidity support differ from transitions on the Prime scale to reflect the risk","page_number":268,"box":{"x":116,"y":327,"width":760,"height":12}},{"id":"3d05752a-ae4a-4c97-a181-c50cc5d1d975","block_type":"box","text":"that external liquidity support will terminate if the issuer’s long-term rating drops below investment","page_number":268,"box":{"x":116,"y":343,"width":729,"height":12}},{"id":"94bffa10-6416-4111-87df-4660e82288a4","block_type":"box","text":"grade.","page_number":268,"box":{"x":116,"y":358,"width":52,"height":12}},{"id":"ac0dbcd6-7a3b-476f-9dfe-ea9f5144efb5","block_type":"box","text":"Moody’s typically assigns the VMIG short-term demand obligation rating if the frequency of the demand","page_number":268,"box":{"x":117,"y":389,"width":771,"height":12}},{"id":"8adfaed9-77d0-491a-b514-6df6f1843d33","block_type":"box","text":"feature is less than every three years. If the frequency of the demand feature is less than three years","page_number":268,"box":{"x":116,"y":405,"width":753,"height":12}},{"id":"6e2a3550-d3b3-49a3-9060-2ec2d034d62e","block_type":"box","text":"but the purchase price is payable only with remarketing proceeds, the short-term demand obligation","page_number":268,"box":{"x":117,"y":420,"width":745,"height":12}},{"id":"b8fe78c9-20ac-48aa-b916-02517f809a2f","block_type":"box","text":"rating is “NR”.","page_number":268,"box":{"x":117,"y":436,"width":107,"height":12}},{"id":"0ba0558d-e6c3-4f4b-822b-2b0c805a492a","block_type":"box","text":"VMIG Scale","page_number":268,"box":{"x":116,"y":467,"width":94,"height":9}},{"id":"b4adcd13-05f1-4492-b387-8419bd54b23b","block_type":"box","text":"VMIG 1 This designation denotes superior credit quality. Excellent protection is afforded by the","page_number":268,"box":{"x":116,"y":498,"width":713,"height":12}},{"id":"c9f788dc-9de6-4b4a-a529-ef5095348963","block_type":"box","text":"superior short-term credit strength of the liquidity provider and structural and legal protections","page_number":268,"box":{"x":184,"y":513,"width":697,"height":12}},{"id":"636ef9f4-a3d0-4e79-8f4b-e51542dbe3e4","block_type":"box","text":"that ensure the timely payment of purchase price upon demand.","page_number":268,"box":{"x":183,"y":529,"width":481,"height":12}},{"id":"2a516418-5380-4ea3-b28f-12fd7e4eda5a","block_type":"box","text":"VMIG 2 This designation denotes strong credit quality. Good protection is afforded by the strong short","page_number":268,"box":{"x":116,"y":552,"width":766,"height":12}},{"id":"d05a29f6-d7ae-43e3-bbf0-a81167f3bc93","block_type":"box","text":"term credit strength of the liquidity provider and structural and legal protections that ensure","page_number":268,"box":{"x":183,"y":568,"width":679,"height":12}},{"id":"a597c441-327c-402e-9132-2c7f9f5fc6c0","block_type":"box","text":"the timely payment of purchase price upon demand.","page_number":268,"box":{"x":183,"y":583,"width":392,"height":12}},{"id":"c51e611f-3b4f-4b72-ae29-e1f587995ce1","block_type":"box","text":"VMIG 3 This designation denotes acceptable credit quality. Adequate protection is afforded by the","page_number":268,"box":{"x":116,"y":606,"width":738,"height":12}},{"id":"136ee8f1-b964-4b6d-ba4f-6eed262233f4","block_type":"box","text":"satisfactory short-term credit strength of the liquidity provider and structural and legal","page_number":268,"box":{"x":184,"y":622,"width":635,"height":12}},{"id":"2cbeef8b-90df-4dcc-846d-93421001e814","block_type":"box","text":"protections that ensure the timely payment of purchase price upon demand.","page_number":268,"box":{"x":184,"y":637,"width":567,"height":12}},{"id":"889d21bf-7c58-42fe-9c07-cf9e547365f1","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Demand features rated in this","page_number":268,"box":{"x":116,"y":661,"width":720,"height":12}},{"id":"10f8b0bb-7999-4f4c-b272-6116260ecc09","block_type":"box","text":"category may be supported by a liquidity provider that does not have a sufficiently strong","page_number":268,"box":{"x":184,"y":676,"width":657,"height":12}},{"id":"9acfbe13-b6cb-4385-aa27-77f3fca4ceb8","block_type":"box","text":"short-term rating or may lack the structural or legal protections necessary to ensure the timely","page_number":268,"box":{"x":184,"y":692,"width":695,"height":12}},{"id":"850d612b-c291-4942-9d8c-a8fcee1537b2","block_type":"box","text":"payment of purchase price upon demand.","page_number":268,"box":{"x":184,"y":707,"width":308,"height":12}},{"id":"e8d8e062-ffb8-407e-b296-a8b5056142de","block_type":"box","text":"Description of S&P Global Ratings (“S&P”), a Division of S&P Global Inc., Issue Credit Ratings","page_number":268,"box":{"x":117,"y":738,"width":753,"height":12}},{"id":"a494de0c-29d3-410f-ae3e-23c0bfbee70a","block_type":"box","text":"An S&P issue credit rating is a forward-looking opinion about the creditworthiness of an obligor with","page_number":268,"box":{"x":116,"y":769,"width":737,"height":12}},{"id":"2f315cb9-858c-43b8-9025-53703c7bd57b","block_type":"box","text":"respect to a specific financial obligation, a specific class of financial obligations, or a specific financial","page_number":268,"box":{"x":117,"y":785,"width":748,"height":12}},{"id":"97273e8e-922f-47d0-ad9f-562ae240ed18","block_type":"box","text":"program (including ratings on medium-term note programs and commercial paper programs). It takes","page_number":268,"box":{"x":117,"y":800,"width":750,"height":12}},{"id":"5bd521ce-59e9-438e-8857-cb8ac289d5de","block_type":"box","text":"into consideration the creditworthiness of guarantors, insurers, or other forms of credit enhancement","page_number":268,"box":{"x":117,"y":816,"width":744,"height":12}},{"id":"338a9653-be70-4598-94ef-73ad7157ad8a","block_type":"box","text":"on the obligation and takes into account the currency in which the obligation is denominated. The","page_number":268,"box":{"x":116,"y":831,"width":726,"height":12}},{"id":"241d5e25-5b18-404d-82c2-3cf4938a431e","block_type":"box","text":"opinion reflects S&P’s view of the obligor’s capacity and willingness to meet its financial commitments","page_number":268,"box":{"x":116,"y":847,"width":759,"height":12}},{"id":"836f98d4-7c3f-4660-946c-47234fffabbe","block_type":"box","text":"as they come due, and this opinion may assess terms, such as collateral security and subordination,","page_number":268,"box":{"x":116,"y":862,"width":750,"height":12}},{"id":"9e3b0f83-f28e-4109-87d4-6a0557195934","block_type":"box","text":"which could affect ultimate payment in the event of default.","page_number":268,"box":{"x":116,"y":878,"width":441,"height":12}},{"id":"02096dd2-e602-4abf-8574-e6d0296893b7","block_type":"box","text":"A-4","page_number":268,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"1e0e9cd3-83a9-49a0-8bd3-e8113c2b1af9","block_type":"box","text":"NM1026U-6004382-268/605","page_number":268,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"e5ae3f72-8aa5-46e1-bcff-8cd8e6be29d7","block_type":"box","text":"Issue credit ratings can be either long-term or short-term. Short-term issue credit ratings are generally","page_number":269,"box":{"x":117,"y":87,"width":760,"height":12}},{"id":"c58e7df6-63bc-49d5-a570-eb9c8344c2d0","block_type":"box","text":"assigned to those obligations considered short-term in the relevant market, typically with an original","page_number":269,"box":{"x":116,"y":103,"width":743,"height":12}},{"id":"6869b819-249e-4d8a-b289-778004e7599f","block_type":"box","text":"maturity of no more than 365 days. Short-term issue credit ratings are also used to indicate the","page_number":269,"box":{"x":117,"y":118,"width":708,"height":12}},{"id":"537cdfe0-8622-4436-bc2e-148e01b4a38e","block_type":"box","text":"creditworthiness of an obligor with respect to put features on long-term obligations. S&P would typically","page_number":269,"box":{"x":116,"y":134,"width":771,"height":12}},{"id":"32db9b45-6510-4216-ad4a-f3e076872337","block_type":"box","text":"assign a long-term issue credit rating to an obligation with an original maturity of greater than 365 days.","page_number":269,"box":{"x":116,"y":149,"width":772,"height":12}},{"id":"1381fac8-fa01-46cf-ae82-77890d0896b4","block_type":"box","text":"However, the ratings S&P assigns to certain instruments may diverge from these guidelines based on","page_number":269,"box":{"x":117,"y":165,"width":758,"height":12}},{"id":"6dc43375-fff9-4a08-958a-185f993dbcf3","block_type":"box","text":"market practices. Medium-term notes are assigned long-term ratings.","page_number":269,"box":{"x":117,"y":180,"width":518,"height":12}},{"id":"84c258d3-a2f9-4cf3-bf58-c7fdcea27fc9","block_type":"box","text":"Issue credit ratings are based, in varying degrees, on S&P’s analysis of the following considerations:","page_number":269,"box":{"x":117,"y":211,"width":750,"height":12}},{"id":"279aae46-fe94-4ade-a6e9-bd838b3c75b1","block_type":"box","text":"• The likelihood of payment—the capacity and willingness of the obligor to meet its financial","page_number":269,"box":{"x":150,"y":242,"width":706,"height":12}},{"id":"e9d87e77-94e0-4863-a257-77384395432a","block_type":"box","text":"commitments on an obligation in accordance with the terms of the obligation;","page_number":269,"box":{"x":184,"y":258,"width":575,"height":12}},{"id":"7effe572-bd83-41bd-ba2f-60ff719d00a7","block_type":"box","text":"• The nature and provisions of the financial obligation, and the promise S&P imputes; and","page_number":269,"box":{"x":150,"y":281,"width":692,"height":12}},{"id":"26b6d825-3e90-4258-96aa-ab9f95aeabdc","block_type":"box","text":"• The protection afforded by, and relative position of, the financial obligation in the event of a","page_number":269,"box":{"x":150,"y":304,"width":712,"height":12}},{"id":"7a9e308f-0827-485a-b874-faa0381fd3f3","block_type":"box","text":"bankruptcy, reorganization, or other arrangement under the laws of bankruptcy and other laws","page_number":269,"box":{"x":184,"y":320,"width":704,"height":12}},{"id":"b7f2e2ed-0024-47f1-936d-7a1fc6228f23","block_type":"box","text":"affecting creditors’ rights.","page_number":269,"box":{"x":184,"y":335,"width":191,"height":12}},{"id":"95b7a51c-3c06-471d-b885-0cac460aba99","block_type":"box","text":"An issue rating is an assessment of default risk but may incorporate an assessment of relative seniority","page_number":269,"box":{"x":116,"y":366,"width":772,"height":12}},{"id":"57f1605e-1932-4fb1-a179-38c27abd08ee","block_type":"box","text":"or ultimate recovery in the event of default. Junior obligations are typically rated lower than senior","page_number":269,"box":{"x":116,"y":382,"width":728,"height":12}},{"id":"4e5f8cb9-fa85-43c4-bdc9-48d94c5d3dd8","block_type":"box","text":"obligations, to reflect lower priority in bankruptcy, as noted above. (Such differentiation may apply","page_number":269,"box":{"x":116,"y":397,"width":729,"height":12}},{"id":"5dbab956-2f7d-4c83-b333-0894913f07ff","block_type":"box","text":"when an entity has both senior and subordinated obligations, secured and unsecured obligations, or","page_number":269,"box":{"x":116,"y":413,"width":747,"height":12}},{"id":"69c65ae0-e9cf-4479-8d97-947ec0b08091","block_type":"box","text":"operating company and holding company obligations.)","page_number":269,"box":{"x":116,"y":428,"width":407,"height":12}},{"id":"035e44c3-253b-4ba1-a51a-ab48da933026","block_type":"box","text":"Long-Term Issue Credit Ratings*","page_number":269,"box":{"x":117,"y":459,"width":265,"height":12}},{"id":"3edc168c-607b-4a5a-87e8-95c0298183a3","block_type":"box","text":"AAA An obligation rated ‘AAA’ has the highest rating assigned by S&P. The obligor’s capacity to","page_number":269,"box":{"x":116,"y":490,"width":755,"height":12}},{"id":"40f481ce-d47b-4f84-9f0c-2667dcc6368e","block_type":"box","text":"meet its financial commitments on the obligation is extremely strong.","page_number":269,"box":{"x":192,"y":506,"width":513,"height":12}},{"id":"7069d052-7c9c-41c7-82df-96ea8f51a3c6","block_type":"box","text":"AA An obligation rated ‘AA’ differs from the highest-rated obligations only to a small degree.","page_number":269,"box":{"x":116,"y":529,"width":734,"height":12}},{"id":"db90eb05-328a-4163-8171-172e99000cb5","block_type":"box","text":"The obligor’s capacity to meet its financial commitments on the obligation is very strong.","page_number":269,"box":{"x":191,"y":544,"width":659,"height":12}},{"id":"cf3ad2b9-6576-4091-8f68-f6ad881d2f24","block_type":"box","text":"A An obligation rated ‘A’ is somewhat more susceptible to the adverse effects of changes in","page_number":269,"box":{"x":116,"y":568,"width":744,"height":12}},{"id":"0883cded-5b33-4a45-9ed2-2f7d7c2de209","block_type":"box","text":"circumstances and economic conditions than obligations in higher-rated categories.","page_number":269,"box":{"x":192,"y":583,"width":624,"height":12}},{"id":"e9c63e27-58bf-414f-92f1-bf6380258b0f","block_type":"box","text":"However, the obligor’s capacity to meet its financial commitments on the obligation is still","page_number":269,"box":{"x":192,"y":599,"width":664,"height":12}},{"id":"8ba8975d-620e-4493-8a43-b2875608f8fc","block_type":"box","text":"strong.","page_number":269,"box":{"x":191,"y":614,"width":56,"height":12}},{"id":"9f1ca4ee-d118-458a-b46f-d07c5e3a692b","block_type":"box","text":"BBB An obligation rated ‘BBB’ exhibits adequate protection parameters. However, adverse","page_number":269,"box":{"x":117,"y":637,"width":715,"height":12}},{"id":"1be60b85-23cf-4cd5-9055-a65f68841bf5","block_type":"box","text":"economic conditions or changing circumstances are more likely to weaken the obligor’s","page_number":269,"box":{"x":192,"y":653,"width":652,"height":12}},{"id":"0fab124f-1688-46fc-a71d-275bbcba30f4","block_type":"box","text":"capacity to meet its financial commitments on the obligation.","page_number":269,"box":{"x":192,"y":668,"width":446,"height":12}},{"id":"bd72eaa8-2dab-428e-8392-b84f784a505f","block_type":"box","text":"BB, B,","page_number":269,"box":{"x":117,"y":692,"width":45,"height":11}},{"id":"6d116c5d-c5b5-41ac-9869-589c5717f0dd","block_type":"box","text":"CCC,","page_number":269,"box":{"x":117,"y":707,"width":38,"height":11}},{"id":"5cbb8a32-880a-47ea-8684-0da068ff7efb","block_type":"box","text":"CC,","page_number":269,"box":{"x":117,"y":723,"width":26,"height":11}},{"id":"8c1b9f58-2065-4ea3-a163-2ff638e45b49","block_type":"box","text":"and C","page_number":269,"box":{"x":116,"y":738,"width":44,"height":10}},{"id":"abfe8e14-e06f-4ea6-bf75-200a83774a99","block_type":"box","text":"Obligations rated ‘BB’, ‘B’, ‘CCC’, ‘CC’, and ‘C’ are regarded as having significant","page_number":269,"box":{"x":192,"y":692,"width":602,"height":12}},{"id":"ffb6277e-9494-4996-9bdc-ae1ec0491ba8","block_type":"box","text":"speculative characteristics. ‘BB’ indicates the least degree of speculation and ‘C’ the","page_number":269,"box":{"x":191,"y":707,"width":625,"height":12}},{"id":"8baab101-abd0-454e-aebb-73e5bc8536bc","block_type":"box","text":"highest. While such obligations will likely have some quality and protective characteristics,","page_number":269,"box":{"x":192,"y":723,"width":666,"height":12}},{"id":"9dbc3f0f-3fad-43f3-8257-8922d15ff1a3","block_type":"box","text":"these may be outweighed by large uncertainties or major exposure to adverse conditions.","page_number":269,"box":{"x":191,"y":738,"width":664,"height":12}},{"id":"2ef15545-c69b-428b-80bc-9dcf1ceff5e6","block_type":"box","text":"BB An obligation rated ‘BB’ is less vulnerable to nonpayment than other speculative issues.","page_number":269,"box":{"x":117,"y":761,"width":723,"height":13}},{"id":"205f9fd0-12a9-4d63-86fe-4b8f480022aa","block_type":"box","text":"However, it faces major ongoing uncertainties or exposure to adverse business, financial,","page_number":269,"box":{"x":192,"y":777,"width":662,"height":12}},{"id":"7d0987f9-1042-44c0-a0cf-29721d2a6b1c","block_type":"box","text":"or economic conditions that could lead to the obligor’s inadequate capacity to meet its","page_number":269,"box":{"x":192,"y":793,"width":635,"height":12}},{"id":"67044de3-9e56-4a12-a80d-390f92c514e8","block_type":"box","text":"financial commitments on the obligation.","page_number":269,"box":{"x":191,"y":808,"width":298,"height":12}},{"id":"52c6ee94-42d5-4fc7-bb5e-a9447b8cdca3","block_type":"box","text":"B An obligation rated ‘B’ is more vulnerable to nonpayment than obligations rated ‘BB’, but","page_number":269,"box":{"x":117,"y":831,"width":733,"height":12}},{"id":"07c36916-1924-4d9d-8102-c1aead6f7922","block_type":"box","text":"the obligor currently has the capacity to meet its financial commitments on the obligation.","page_number":269,"box":{"x":191,"y":847,"width":665,"height":12}},{"id":"d893d63e-f545-4da9-a374-14c465ea54b5","block_type":"box","text":"Adverse business, financial, or economic conditions will likely impair the obligor’s capacity","page_number":269,"box":{"x":191,"y":862,"width":672,"height":12}},{"id":"b8515a69-4ed3-4dc1-843c-9df03a733b88","block_type":"box","text":"or willingness to meet its financial commitments on the obligation.","page_number":269,"box":{"x":192,"y":878,"width":491,"height":12}},{"id":"b661fa55-5474-484f-a3ec-30a5ae65bc96","block_type":"box","text":"A-5","page_number":269,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"400aa3d7-f6c1-4883-a1fd-2f8100eec22d","block_type":"box","text":"NM1026U-6004382-269/605","page_number":269,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b813faff-98f3-42bd-824d-7fe50b8c6790","block_type":"box","text":"CCC An obligation rated ‘CCC’ is currently vulnerable to nonpayment and is dependent upon","page_number":270,"box":{"x":117,"y":87,"width":728,"height":12}},{"id":"d755a5e6-0b9e-4b67-baf2-7f72c077d566","block_type":"box","text":"favorable business, financial, and economic conditions for the obligor to meet its financial","page_number":270,"box":{"x":191,"y":102,"width":667,"height":13}},{"id":"3c4f88c5-f4d3-46aa-82dc-29c8f45bc473","block_type":"box","text":"commitments on the obligation. In the event of adverse business, financial, or economic","page_number":270,"box":{"x":192,"y":118,"width":656,"height":12}},{"id":"f6eaca45-432e-4c85-a6c3-60440ca0f4dc","block_type":"box","text":"conditions, the obligor is not likely to have the capacity to meet its financial commitments","page_number":270,"box":{"x":192,"y":134,"width":662,"height":12}},{"id":"a89e675d-e73d-49e8-8da2-25694c91ae1d","block_type":"box","text":"on the obligation.","page_number":270,"box":{"x":192,"y":149,"width":132,"height":12}},{"id":"4b798141-30e9-4802-9887-d2a1abe3de4b","block_type":"box","text":"CC An obligation rated ‘CC’ is currently highly vulnerable to nonpayment. The ‘CC’ rating is","page_number":270,"box":{"x":117,"y":172,"width":727,"height":12}},{"id":"f9347c80-343a-4c77-82b7-45b588ec946a","block_type":"box","text":"used when a default has not yet occurred but S&P expects default to be a virtual certainty,","page_number":270,"box":{"x":192,"y":188,"width":675,"height":12}},{"id":"75f1c860-492e-4706-8679-0f4eaf859950","block_type":"box","text":"regardless of the anticipated time to default.","page_number":270,"box":{"x":192,"y":203,"width":330,"height":12}},{"id":"c93ebb0a-6f78-4e8b-8d82-6e94b7f876ec","block_type":"box","text":"C An obligation rated ‘C’ is currently highly vulnerable to nonpayment, and the obligation is","page_number":270,"box":{"x":117,"y":227,"width":735,"height":12}},{"id":"e3e8d85f-08b2-43d0-9059-3dedbf2c8789","block_type":"box","text":"expected to have lower relative seniority or lower ultimate recovery compared with","page_number":270,"box":{"x":192,"y":242,"width":615,"height":12}},{"id":"ab9e0465-cc09-4df6-bbd2-4b1b0e8c18e8","block_type":"box","text":"obligations that are rated higher.","page_number":270,"box":{"x":192,"y":258,"width":245,"height":12}},{"id":"147d24b3-3132-458a-b7f1-82d8923ce277","block_type":"box","text":"D An obligation rated ‘D’ is in default or in breach of an imputed promise. For non-hybrid","page_number":270,"box":{"x":117,"y":281,"width":717,"height":12}},{"id":"5f38d78f-5ff3-4373-91b6-7c940eb31492","block_type":"box","text":"capital instruments, the ‘D’ rating category is used when payments on an obligation are not","page_number":270,"box":{"x":192,"y":296,"width":678,"height":12}},{"id":"cc6cfcdd-00cd-41b8-90b8-017c8ff84501","block_type":"box","text":"made on the date due, unless S&P believes that such payments will be made within five","page_number":270,"box":{"x":192,"y":312,"width":657,"height":12}},{"id":"57ea7b21-1b11-496f-bafb-a5b559b23dcf","block_type":"box","text":"business days in the absence of a stated grace period or within the earlier of the stated","page_number":270,"box":{"x":192,"y":327,"width":650,"height":12}},{"id":"3bef32e1-eecf-4de3-b4bd-fd50e0e6b50f","block_type":"box","text":"grace period or 30 calendar days. The ‘D’ rating also will be used upon the filing of a","page_number":270,"box":{"x":191,"y":343,"width":630,"height":12}},{"id":"b3fbe574-1f9d-4381-ba8a-44ed7fdf3f63","block_type":"box","text":"bankruptcy petition or the taking of similar action and where default on an obligation is a","page_number":270,"box":{"x":192,"y":358,"width":657,"height":12}},{"id":"70521529-a1f4-43fa-bd16-5eb89400c790","block_type":"box","text":"virtual certainty, for example due to automatic stay provisions. A rating on an obligation is","page_number":270,"box":{"x":191,"y":374,"width":668,"height":12}},{"id":"5a6f85a0-ffda-4f6f-892a-af13266a8f76","block_type":"box","text":"lowered to ‘D’ if it is subject to a distressed debt restructuring.","page_number":270,"box":{"x":192,"y":389,"width":461,"height":12}},{"id":"8ea88052-052a-40a4-b141-d9d1f65de4fc","block_type":"box","text":"* Ratings from ‘AA’ to ‘CCC’ may be modified by the addition of a plus (+) or minus (-) sign to show relative standing","page_number":270,"box":{"x":143,"y":418,"width":705,"height":9}},{"id":"b000c805-9913-40ff-b684-40d2c1f34202","block_type":"box","text":"within the rating categories.","page_number":270,"box":{"x":170,"y":431,"width":162,"height":9}},{"id":"7963ad83-f891-4f0a-92c5-3e19548b3ffd","block_type":"box","text":"Short-Term Issue Credit Ratings","page_number":270,"box":{"x":116,"y":458,"width":263,"height":12}},{"id":"38db1852-4b60-47ac-a825-aa836e2f2f0c","block_type":"box","text":"A-1 A short-term obligation rated ‘A-1’ is rated in the highest category by S&P. The obligor’s","page_number":270,"box":{"x":116,"y":487,"width":715,"height":12}},{"id":"ffc36e90-1ab0-4b9b-8de1-626d0cda5460","block_type":"box","text":"capacity to meet its financial commitments on the obligation is strong. Within this category,","page_number":270,"box":{"x":175,"y":502,"width":677,"height":12}},{"id":"d688cb29-4d84-4b16-837d-ea3de673423a","block_type":"box","text":"certain obligations are designated with a plus sign (+). This indicates that the obligor’s capacity","page_number":270,"box":{"x":175,"y":518,"width":708,"height":12}},{"id":"01ebc535-7b50-4840-af8f-d4f33725c6c6","block_type":"box","text":"to meet its financial commitments on these obligations is extremely strong.","page_number":270,"box":{"x":175,"y":533,"width":558,"height":12}},{"id":"5f8a5d8b-f985-4cf9-b944-c1874507a5f9","block_type":"box","text":"A-2 A short-term obligation rated ‘A-2’ is somewhat more susceptible to the adverse effects of","page_number":270,"box":{"x":116,"y":556,"width":729,"height":12}},{"id":"1f2e760d-2540-40ff-9da3-79f3174f7d71","block_type":"box","text":"changes in circumstances and economic conditions than obligations in higher rating","page_number":270,"box":{"x":175,"y":571,"width":626,"height":12}},{"id":"e99e7e47-d36e-4365-8d0b-bb6aae4470a7","block_type":"box","text":"categories. However, the obligor’s capacity to meet its financial commitments on the obligation","page_number":270,"box":{"x":175,"y":587,"width":706,"height":12}},{"id":"910b2b06-3820-4515-a1c7-f369cda49bcf","block_type":"box","text":"is satisfactory.","page_number":270,"box":{"x":176,"y":602,"width":110,"height":12}},{"id":"cd00758e-cf1e-44ab-a858-6178c7965c39","block_type":"box","text":"A-3 A short-term obligation rated ‘A-3’ exhibits adequate protection parameters. However, adverse","page_number":270,"box":{"x":116,"y":624,"width":764,"height":13}},{"id":"f5870ba5-d4e9-4a2e-8846-67857d63f695","block_type":"box","text":"economic conditions or changing circumstances are more likely to weaken an obligor’s","page_number":270,"box":{"x":175,"y":640,"width":648,"height":12}},{"id":"43421ea6-5767-47fc-b778-3807e8e99c44","block_type":"box","text":"capacity to meet its financial commitments on the obligation.","page_number":270,"box":{"x":175,"y":655,"width":453,"height":13}},{"id":"af3698fc-2f39-45dd-a9a6-c1eeff3f2a00","block_type":"box","text":"B A short-term obligation rated ‘B’ is regarded as vulnerable and has significant speculative","page_number":270,"box":{"x":117,"y":678,"width":719,"height":12}},{"id":"35ca6cf3-11e3-4a5e-92a1-194c8c94acc4","block_type":"box","text":"characteristics. The obligor currently has the capacity to meet its financial commitments;","page_number":270,"box":{"x":175,"y":693,"width":653,"height":12}},{"id":"b7aece47-327a-4932-a115-1b7e3163d73b","block_type":"box","text":"however, it faces major ongoing uncertainties that could lead to the obligor’s inadequate","page_number":270,"box":{"x":176,"y":709,"width":652,"height":12}},{"id":"1df54d8a-df2c-496c-a9e6-37c7a7d6e39d","block_type":"box","text":"capacity to meet its financial commitments.","page_number":270,"box":{"x":175,"y":724,"width":318,"height":12}},{"id":"ce639447-9ce8-4c6d-8d4b-453038d608e9","block_type":"box","text":"C A short-term obligation rated ‘C’ is currently vulnerable to nonpayment and is dependent upon","page_number":270,"box":{"x":117,"y":747,"width":754,"height":12}},{"id":"4a470911-476f-41ab-9023-1c278b0738ba","block_type":"box","text":"favorable business, financial, and economic conditions for the obligor to meet its financial","page_number":270,"box":{"x":175,"y":762,"width":661,"height":12}},{"id":"2a39670a-80c6-4dbf-b271-f5863a1d3d2d","block_type":"box","text":"commitments on the obligation.","page_number":270,"box":{"x":175,"y":778,"width":231,"height":12}},{"id":"aed532d9-139e-420a-81e0-fab569f4affa","block_type":"box","text":"D A short-term obligation rated ‘D’ is in default or in breach of an imputed promise. For","page_number":270,"box":{"x":117,"y":800,"width":684,"height":12}},{"id":"6e089621-5902-474d-9b3a-310d6425c5f8","block_type":"box","text":"non-hybrid capital instruments, the ‘D’ rating category is used when payments on an obligation","page_number":270,"box":{"x":176,"y":815,"width":699,"height":12}},{"id":"a9ce2c15-57f4-4e50-9f50-f7b3792bec70","block_type":"box","text":"are not made on the date due, unless S&P believes that such payments will be made within","page_number":270,"box":{"x":175,"y":831,"width":684,"height":12}},{"id":"55f4da9d-e2f6-4ad6-b162-522f6381eb0c","block_type":"box","text":"any stated grace period. However, any stated grace period longer than five business days will","page_number":270,"box":{"x":175,"y":846,"width":700,"height":12}},{"id":"7bd9f6bf-2db0-4fc6-b11b-62e263aba3cd","block_type":"box","text":"be treated as five business days. The ‘D’ rating also will be used upon the filing of a bankruptcy","page_number":270,"box":{"x":176,"y":862,"width":711,"height":12}},{"id":"9aeb4436-f9aa-4f3c-a146-7b08094a5283","block_type":"box","text":"petition or the taking of a similar action and where default on an obligation is a virtual certainty,","page_number":270,"box":{"x":176,"y":877,"width":706,"height":12}},{"id":"c3d0bd4e-0dfb-4c35-8806-0c1a8ae8a501","block_type":"box","text":"A-6","page_number":270,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"ca38c3ea-e6f8-4095-a4f7-a2def54b17c0","block_type":"box","text":"NM1026U-6004382-270/605","page_number":270,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"8b179241-02a2-4f3d-ba3a-4907842521d9","block_type":"box","text":"for example due to automatic stay provisions. A rating on an obligation is lowered to ‘D’ if it is","page_number":271,"box":{"x":175,"y":87,"width":695,"height":12}},{"id":"9477be7a-0f70-467c-95a3-a255f587337a","block_type":"box","text":"subject to a distressed debt restructuring.","page_number":271,"box":{"x":175,"y":103,"width":312,"height":12}},{"id":"8d256229-e71d-46b5-8164-8df8b96dd2f1","block_type":"box","text":"Description of S&P’s Municipal Short-Term Note Ratings","page_number":271,"box":{"x":117,"y":134,"width":456,"height":12}},{"id":"0d263415-9ea2-41cb-a18e-5e1cff044698","block_type":"box","text":"An S&P U.S. municipal note rating reflects S&P’s opinion about the liquidity factors and market access","page_number":271,"box":{"x":116,"y":165,"width":766,"height":12}},{"id":"9db1c043-d187-4e3b-98dd-3c083f9ffe0b","block_type":"box","text":"risks unique to the notes. Notes due in three years or less will likely receive a note rating. Notes with","page_number":271,"box":{"x":117,"y":180,"width":748,"height":12}},{"id":"6adb9b53-996a-43e8-8748-7ea2a6aad205","block_type":"box","text":"an original maturity of more than three years will most likely receive a long-term debt rating. In","page_number":271,"box":{"x":116,"y":196,"width":703,"height":12}},{"id":"dc076d96-c090-459d-8414-7e9c41347a4e","block_type":"box","text":"determining which type of rating, if any, to assign, S&P’s analysis will review the following","page_number":271,"box":{"x":116,"y":211,"width":668,"height":12}},{"id":"8c9488e1-adc8-4b08-a136-999436186256","block_type":"box","text":"considerations:","page_number":271,"box":{"x":116,"y":227,"width":118,"height":9}},{"id":"9bd7ac8a-6105-4619-b920-b908b9ab4379","block_type":"box","text":"• Amortization schedule—the larger the final maturity relative to other maturities, the more likely","page_number":271,"box":{"x":150,"y":258,"width":736,"height":12}},{"id":"d493fe33-36df-4f9f-afce-612dad4210da","block_type":"box","text":"it will be treated as a note; and","page_number":271,"box":{"x":184,"y":273,"width":232,"height":11}},{"id":"a7e20c58-0908-4773-b5a5-07eb5d2fb2a0","block_type":"box","text":"• Source of payment—the more dependent the issue is on the market for its refinancing, the","page_number":271,"box":{"x":150,"y":296,"width":709,"height":12}},{"id":"d1b0b06a-86af-422e-b366-c6369465bc7a","block_type":"box","text":"more likely it will be treated as a note.","page_number":271,"box":{"x":184,"y":312,"width":284,"height":12}},{"id":"d4e55ae6-fdc2-4abb-bd40-fb633b20e628","block_type":"box","text":"S&P’s municipal short-term note rating symbols are as follows:","page_number":271,"box":{"x":116,"y":343,"width":470,"height":12}},{"id":"ed972ea2-5fd4-4f4c-bfed-d0b351552652","block_type":"box","text":"SP-1 Strong capacity to pay principal and interest. An issue determined to possess a very strong","page_number":271,"box":{"x":116,"y":374,"width":740,"height":12}},{"id":"438a6519-b8d8-4964-895f-7ab5e1d7eebf","block_type":"box","text":"capacity to pay debt service is given a plus (+) designation.","page_number":271,"box":{"x":175,"y":389,"width":445,"height":12}},{"id":"46eccec2-0fce-455c-b72d-a82ee19dd0f1","block_type":"box","text":"SP-2 Satisfactory capacity to pay principal and interest, with some vulnerability to adverse financial","page_number":271,"box":{"x":116,"y":413,"width":757,"height":12}},{"id":"856c4e65-aba1-4d16-b8eb-c90c977fd701","block_type":"box","text":"and economic changes over the term of the notes.","page_number":271,"box":{"x":175,"y":428,"width":379,"height":12}},{"id":"515c4e86-9bd8-4f39-a845-2616b1f9d745","block_type":"box","text":"SP-3 Speculative capacity to pay principal and interest.","page_number":271,"box":{"x":116,"y":451,"width":432,"height":12}},{"id":"c6f7b09f-6c30-458f-b10e-928a143e4ddc","block_type":"box","text":"D ‘D’ is assigned upon failure to pay the note when due, completion of a distressed debt","page_number":271,"box":{"x":117,"y":475,"width":699,"height":12}},{"id":"226495a2-b35f-408d-8097-918453979962","block_type":"box","text":"restructuring, or the filing of a bankruptcy petition or the taking of similar action and where","page_number":271,"box":{"x":176,"y":490,"width":670,"height":12}},{"id":"cef34cce-16f6-46c9-9941-b53a7b9719e2","block_type":"box","text":"default on an obligation is a virtual certainty, for example due to automatic stay provisions.","page_number":271,"box":{"x":175,"y":506,"width":674,"height":12}},{"id":"c854953a-02da-4635-bfdd-262e86a12475","block_type":"box","text":"Description of Fitch Ratings’ (“Fitch’s”) Credit Ratings Scales","page_number":271,"box":{"x":117,"y":537,"width":498,"height":12}},{"id":"c23b41b3-bcc1-4564-8c01-25d8083422f2","block_type":"box","text":"Fitch Ratings publishes opinions on a variety of scales. The most common of these are credit ratings,","page_number":271,"box":{"x":117,"y":568,"width":756,"height":12}},{"id":"1a1a0d26-8ac9-4254-a1fd-fc470bf39243","block_type":"box","text":"but the agency also publishes ratings, scores and other relative opinions relating to financial or","page_number":271,"box":{"x":117,"y":583,"width":706,"height":12}},{"id":"6ffbb60f-8ebc-4da5-8f03-74ff7dbdac29","block_type":"box","text":"operational strength. For example, Fitch also provides specialized ratings of servicers of residential","page_number":271,"box":{"x":116,"y":599,"width":740,"height":12}},{"id":"bcbf96a3-b636-48b2-9488-d642b8b67fe7","block_type":"box","text":"and commercial mortgages, asset managers and funds. In each case, users should refer to the","page_number":271,"box":{"x":116,"y":614,"width":711,"height":12}},{"id":"cc441bc9-a03e-4aec-8c68-270253b16ea6","block_type":"box","text":"definitions of each individual scale for guidance on the dimensions of risk covered in each assessment.","page_number":271,"box":{"x":116,"y":630,"width":769,"height":12}},{"id":"d18135b0-403b-44da-acc6-b2ab34ecceed","block_type":"box","text":"Fitch’s credit ratings relating to issuers are an opinion on the relative ability of an entity to meet","page_number":271,"box":{"x":117,"y":661,"width":702,"height":12}},{"id":"010a3024-d7df-458d-bf13-e26761970a17","block_type":"box","text":"financial commitments, such as interest, preferred dividends, repayment of principal, insurance claims","page_number":271,"box":{"x":116,"y":676,"width":756,"height":12}},{"id":"b625e4b0-337c-44e3-96ab-232185bec1ad","block_type":"box","text":"or counterparty obligations. Credit ratings relating to securities and obligations of an issuer can include","page_number":271,"box":{"x":116,"y":692,"width":761,"height":12}},{"id":"ccde7c38-a1db-43b7-8f80-0696585a5ac4","block_type":"box","text":"a recovery expectation. Credit ratings are used by investors as indications of the likelihood of receiving","page_number":271,"box":{"x":116,"y":707,"width":761,"height":12}},{"id":"72bf6c47-8983-4a8e-aabc-b74054a8a7eb","block_type":"box","text":"the money owed to them in accordance with the terms on which they invested. The agency’s credit","page_number":271,"box":{"x":116,"y":723,"width":733,"height":12}},{"id":"ac5f97bb-b110-4120-82d6-224c292d6506","block_type":"box","text":"ratings cover the global spectrum of corporate, sovereign financial, bank, insurance, and public finance","page_number":271,"box":{"x":117,"y":738,"width":763,"height":12}},{"id":"726c70d9-3e6e-49a4-99d4-9044bf4debec","block_type":"box","text":"entities (including supranational and sub-national entities) and the securities or other obligations they","page_number":271,"box":{"x":116,"y":754,"width":749,"height":12}},{"id":"d23ab76f-8b0a-4eb1-a2b1-bfaadc824ab2","block_type":"box","text":"issue, as well as structured finance securities backed by receivables or other financial assets.","page_number":271,"box":{"x":117,"y":769,"width":692,"height":12}},{"id":"a3b29e05-b7e7-4ae0-b48e-aca44c152edb","block_type":"box","text":"The terms “investment grade” and “speculative grade” have established themselves over time as","page_number":271,"box":{"x":116,"y":800,"width":718,"height":12}},{"id":"ca6c34ae-7bc1-4646-b8bf-6e04054e4e7a","block_type":"box","text":"shorthand to describe the categories ‘AAA’ to ‘BBB’ (investment grade) and ‘BB’ to ‘D’ (speculative","page_number":271,"box":{"x":116,"y":816,"width":732,"height":12}},{"id":"5e502570-788a-4294-b3f7-bba32aa44f4d","block_type":"box","text":"grade). The terms investment grade and speculative grade are market conventions and do not imply","page_number":271,"box":{"x":116,"y":831,"width":749,"height":12}},{"id":"d87fbc36-b871-4174-990a-cecf73c8aecd","block_type":"box","text":"any recommendation or endorsement of a specific security for investment purposes. Investment grade","page_number":271,"box":{"x":116,"y":847,"width":764,"height":12}},{"id":"20d57e01-2018-4a43-b778-cb9ad2947f0f","block_type":"box","text":"categories indicate relatively low to moderate credit risk, while ratings in the speculative categories","page_number":271,"box":{"x":116,"y":862,"width":737,"height":12}},{"id":"da173f0e-82a1-4c59-909a-c7bc796e3e36","block_type":"box","text":"either signal a higher level of credit risk or that a default has already occurred.","page_number":271,"box":{"x":116,"y":878,"width":584,"height":12}},{"id":"b789ab61-f00b-48ae-8e7a-7e902a9b91a1","block_type":"box","text":"A-7","page_number":271,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"c6c06911-054b-43a7-b93e-cc43a5abdec7","block_type":"box","text":"NM1026U-6004382-271/605","page_number":271,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"468877cf-92c4-45b1-a1db-e0bb16ef536a","block_type":"box","text":"For the convenience of investors, Fitch may also include issues relating to a rated issuer that are not","page_number":272,"box":{"x":117,"y":87,"width":750,"height":12}},{"id":"a34a7b32-e9b9-42bc-ae88-fd7bbce7e6cb","block_type":"box","text":"and have not been rated on its web page. Such issues are also denoted as ‘NR’.","page_number":272,"box":{"x":116,"y":102,"width":603,"height":13}},{"id":"3b05ac87-d663-4e07-995e-5e7d9472c1c0","block_type":"box","text":"Credit ratings express risk in relative rank order, which is to say they are ordinal measures of credit risk","page_number":272,"box":{"x":117,"y":132,"width":770,"height":12}},{"id":"3d78a5d4-80f8-4e8f-b919-096f0d34d384","block_type":"box","text":"and are not predictive of a specific frequency of default or loss. For information about the historical","page_number":272,"box":{"x":116,"y":147,"width":735,"height":12}},{"id":"91685962-13e4-4bba-a4ff-58a6de7416bc","block_type":"box","text":"performance of ratings please refer to Fitch’s Ratings Transition and Default studies which detail the","page_number":272,"box":{"x":117,"y":163,"width":747,"height":12}},{"id":"c67d25bb-82eb-4494-9f16-cd338de28e94","block_type":"box","text":"historical default rates and their meaning. The European Securities and Markets Authority also","page_number":272,"box":{"x":117,"y":178,"width":705,"height":12}},{"id":"a0ac74df-6dd4-4ccf-97fb-8da8bb75c6b1","block_type":"box","text":"maintains a central repository of historical default rates.","page_number":272,"box":{"x":117,"y":194,"width":415,"height":12}},{"id":"ccd2662c-7b80-4963-9af7-aa693b835673","block_type":"box","text":"Fitch’s credit ratings do not directly address any risk other than credit risk. In particular, ratings do not","page_number":272,"box":{"x":117,"y":223,"width":756,"height":12}},{"id":"dcae598c-a4dc-4dbc-899a-9bc8945159a2","block_type":"box","text":"deal with the risk of a market value loss on a rated security due to changes in interest rates, liquidity","page_number":272,"box":{"x":116,"y":239,"width":747,"height":12}},{"id":"cf6eb35f-3afa-4741-9ed2-86a56252cdf3","block_type":"box","text":"and other market considerations. However, in terms of payment obligation on the rated liability, market","page_number":272,"box":{"x":116,"y":254,"width":765,"height":12}},{"id":"7083d389-3615-41ac-b9bc-8bf81848e5fd","block_type":"box","text":"risk may be considered to the extent that it influences the ability of an issuer to pay upon a","page_number":272,"box":{"x":117,"y":270,"width":674,"height":12}},{"id":"1a25bbc3-b525-4cfe-b2c1-34d6b58ad6d1","block_type":"box","text":"commitment.","page_number":272,"box":{"x":116,"y":285,"width":101,"height":10}},{"id":"3abfbbe5-44f3-46b1-807a-4bd597ca1142","block_type":"box","text":"Ratings nonetheless do not reflect market risk to the extent that they influence the size or other","page_number":272,"box":{"x":117,"y":314,"width":709,"height":12}},{"id":"b1e70087-1821-4c1e-affc-792e44af13a5","block_type":"box","text":"conditionality of the obligation to pay upon a commitment (for example, in the case of index-linked","page_number":272,"box":{"x":116,"y":330,"width":731,"height":12}},{"id":"d9e2791c-fb70-4805-a9aa-a3c3e10c8cfb","block_type":"box","text":"bonds).","page_number":272,"box":{"x":117,"y":345,"width":59,"height":12}},{"id":"7f80eb3e-a474-4692-a70c-b5eec3ee92d1","block_type":"box","text":"In the default components of ratings assigned to individual obligations or instruments, the agency","page_number":272,"box":{"x":117,"y":375,"width":725,"height":12}},{"id":"df331149-1464-4a43-b135-cce1a88cf903","block_type":"box","text":"typically rates to the likelihood of non-payment or default in accordance with the terms of that","page_number":272,"box":{"x":116,"y":390,"width":695,"height":12}},{"id":"06186bbf-1b4c-40ac-adad-4528f3c11c78","block_type":"box","text":"instrument’s documentation. In limited cases, Fitch may include additional considerations (i.e. rate to a","page_number":272,"box":{"x":117,"y":406,"width":764,"height":12}},{"id":"cc7eb54a-d442-4e6f-a5da-c2f8ffbf3c66","block_type":"box","text":"higher or lower standard than that implied in the obligation’s documentation).","page_number":272,"box":{"x":117,"y":421,"width":573,"height":12}},{"id":"0d89fd8d-b114-4147-8554-00f205a4eacf","block_type":"box","text":"The primary credit rating scales can be used to provide a rating of privately issued obligations or","page_number":272,"box":{"x":116,"y":450,"width":719,"height":12}},{"id":"8915c32b-5ad8-44e3-88c1-5d7435439c09","block_type":"box","text":"certain note issuance programs or for private ratings. In this case the rating is not published, but only","page_number":272,"box":{"x":116,"y":466,"width":753,"height":12}},{"id":"b0ed4989-d755-48b1-8749-503fa8169806","block_type":"box","text":"provided to the issuer or its agents in the form of a rating letter.","page_number":272,"box":{"x":117,"y":481,"width":472,"height":12}},{"id":"bfe240ba-76d1-4b70-9525-fddad7d23107","block_type":"box","text":"The primary credit rating scales may also be used to provide ratings for a more narrow scope,","page_number":272,"box":{"x":116,"y":511,"width":702,"height":12}},{"id":"3eaefa7b-952e-4039-9f37-cb77e5c00f3b","block_type":"box","text":"including interest strips and return of principal or in other forms of opinions such as credit opinions or","page_number":272,"box":{"x":117,"y":526,"width":751,"height":12}},{"id":"8af2ea03-e7a2-4c84-a016-988de7e9eb6f","block_type":"box","text":"rating assessment services. Credit opinions are either a notch- or category-specific view using the","page_number":272,"box":{"x":117,"y":542,"width":731,"height":12}},{"id":"bde26f8e-70b4-486d-80cb-61389bd7b186","block_type":"box","text":"primary rating scale and omit one or more characteristics of a full rating or meet them to a different","page_number":272,"box":{"x":117,"y":557,"width":736,"height":12}},{"id":"fcb2768c-9ca4-4c49-acdf-dadfe6b965ce","block_type":"box","text":"standard. Credit opinions will be indicated using a lower case letter symbol combined with either an ‘*’","page_number":272,"box":{"x":116,"y":573,"width":760,"height":12}},{"id":"2cec29da-e298-4468-b458-9ed882aa4e93","block_type":"box","text":"(e.g. ‘bbb+*’) or (cat) suffix to denote the opinion status. Credit opinions will be point-in-time typically","page_number":272,"box":{"x":117,"y":588,"width":748,"height":12}},{"id":"18682df5-509c-4099-ae30-c06cab6c55a6","block_type":"box","text":"but may be monitored if the analytical group believes information will be sufficiently available. Rating","page_number":272,"box":{"x":117,"y":604,"width":748,"height":12}},{"id":"b9069d12-f37b-4427-a027-67ff2847d554","block_type":"box","text":"assessment services are a notch-specific view using the primary rating scale of how an existing or","page_number":272,"box":{"x":116,"y":619,"width":733,"height":12}},{"id":"eb6b8fde-3015-4e18-9deb-79baa9758837","block_type":"box","text":"potential rating may be changed by a given set of hypothetical circumstances. While credit opinions","page_number":272,"box":{"x":117,"y":635,"width":742,"height":12}},{"id":"c1edb621-b593-4113-b04d-68cb1d47d6e7","block_type":"box","text":"and rating assessment services are point-in-time and are not monitored, they may have a directional","page_number":272,"box":{"x":116,"y":650,"width":750,"height":12}},{"id":"73f64ace-d821-4ab8-bd8d-8c8296184762","block_type":"box","text":"watch or outlook assigned, which can signify the trajectory of the credit profile.","page_number":272,"box":{"x":116,"y":666,"width":579,"height":12}},{"id":"8add9795-bba3-416e-b5ca-b08197f38206","block_type":"box","text":"Description of Fitch’s Long-Term Corporate Finance Obligations Rating Scales","page_number":272,"box":{"x":117,"y":695,"width":629,"height":12}},{"id":"788f285f-53a2-4ca9-a679-4c54fdad7d3a","block_type":"box","text":"Ratings of individual securities or financial obligations of a corporate issuer address relative","page_number":272,"box":{"x":117,"y":724,"width":677,"height":12}},{"id":"22a524d5-47dd-4714-966d-f443c6c0a00e","block_type":"box","text":"vulnerability to default on an ordinal scale. In addition, for financial obligations in corporate finance, a","page_number":272,"box":{"x":116,"y":740,"width":746,"height":12}},{"id":"a47c6bc1-6ba1-4ade-9dc6-8f9c53d2eb75","block_type":"box","text":"measure of recovery given default on that liability is also included in the rating assessment. This","page_number":272,"box":{"x":117,"y":755,"width":711,"height":12}},{"id":"9902bb71-b648-471a-9b11-ae946236dda8","block_type":"box","text":"notably applies to covered bonds ratings, which incorporate both an indication of the probability of","page_number":272,"box":{"x":117,"y":771,"width":725,"height":12}},{"id":"487be941-fcd1-4218-bc65-64b885f5d3c9","block_type":"box","text":"default and of the recovery given a default of this debt instrument. On the contrary, Ratings of","page_number":272,"box":{"x":116,"y":786,"width":695,"height":12}},{"id":"ef2fa700-5ce1-40a2-a207-d80775487c8e","block_type":"box","text":"debtor-in-possession (“DIP”) obligations incorporate the expectation of full repayment.","page_number":272,"box":{"x":116,"y":802,"width":636,"height":12}},{"id":"85e77c70-6549-4915-82e0-ff978ea39b92","block_type":"box","text":"The relationship between the issuer scale and obligation scale assumes a generic historical average","page_number":272,"box":{"x":116,"y":831,"width":750,"height":12}},{"id":"7c920cf2-bfcc-43e4-90fa-8c01732b5c2d","block_type":"box","text":"recovery. Individual obligations can be assigned ratings higher, lower, or the same as that entity’s","page_number":272,"box":{"x":117,"y":847,"width":728,"height":12}},{"id":"79c8ce85-fd62-4dfb-8124-a2927a00ff13","block_type":"box","text":"issuer rating or issuer default rating (“IDR”), based on their relative ranking, relative vulnerability to","page_number":272,"box":{"x":117,"y":862,"width":733,"height":12}},{"id":"9731e0a2-37cd-4b29-9a81-71b0602d5968","block_type":"box","text":"default or based on explicit Recovery Ratings.","page_number":272,"box":{"x":116,"y":877,"width":347,"height":13}},{"id":"bc31b94d-42bf-4680-8b1b-f5555b9ad1eb","block_type":"box","text":"A-8","page_number":272,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"657f63fd-c448-4a2a-b2f5-7b66a778cffd","block_type":"box","text":"NM1026U-6004382-272/605","page_number":272,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"37c0d58b-6d23-4f27-bade-cb0c2a4e12df","block_type":"box","text":"As a result, individual obligations of entities, such as corporations, are assigned ratings higher, lower,","page_number":273,"box":{"x":116,"y":87,"width":756,"height":12}},{"id":"00263cb8-0a62-4051-b4d6-c681ce9cb4bb","block_type":"box","text":"or the same as that entity’s issuer rating or IDR, except DIP obligation ratings that are not based off an","page_number":273,"box":{"x":116,"y":102,"width":766,"height":13}},{"id":"eeb6d5b4-c697-4fad-ad22-9bb8587cb961","block_type":"box","text":"IDR. At the lower end of the ratings scale, Fitch publishes explicit Recovery Ratings in many cases to","page_number":273,"box":{"x":117,"y":118,"width":756,"height":12}},{"id":"e4e6a0dc-207b-4fb5-9ad3-781aa9f2cda3","block_type":"box","text":"complement issuer and obligation ratings.","page_number":273,"box":{"x":116,"y":134,"width":315,"height":12}},{"id":"194a708e-9082-4e4f-9d1d-2a81c1525c0f","block_type":"box","text":"Fitch long-term obligations rating scales are as follows:","page_number":273,"box":{"x":117,"y":165,"width":412,"height":12}},{"id":"0f1f9403-f421-4701-bfdf-9abbc211c05d","block_type":"box","text":"AAA Highest Credit Quality. ‘AAA’ ratings denote the lowest expectation of credit risk. They are","page_number":273,"box":{"x":116,"y":196,"width":731,"height":12}},{"id":"3d8f31b7-eadb-4802-9ae4-b8eb37c823a1","block_type":"box","text":"assigned only in cases of exceptionally strong capacity for payment of financial commitments.","page_number":273,"box":{"x":175,"y":211,"width":700,"height":12}},{"id":"c516b7c7-ce0a-4f4b-9d5a-5a60b1a7dcfa","block_type":"box","text":"This capacity is highly unlikely to be adversely affected by foreseeable events.","page_number":273,"box":{"x":175,"y":227,"width":586,"height":12}},{"id":"e7c01e9a-3a25-4f50-a7fa-495d60f00cb5","block_type":"box","text":"AA Very High Credit Quality. ‘AA’ ratings denote expectations of very low credit risk. They indicate","page_number":273,"box":{"x":116,"y":250,"width":765,"height":12}},{"id":"be2fea34-a712-4f9a-9082-513bc61fd824","block_type":"box","text":"very strong capacity for payment of financial commitments. This capacity is not significantly","page_number":273,"box":{"x":175,"y":265,"width":682,"height":12}},{"id":"8fff100b-02d6-4c70-86b5-0bd56e65190e","block_type":"box","text":"vulnerable to foreseeable events.","page_number":273,"box":{"x":175,"y":281,"width":252,"height":9}},{"id":"d2c9aa52-2047-4c4e-9ae1-b08511c5bf10","block_type":"box","text":"A High Credit Quality. ‘A’ ratings denote expectations of low credit risk. The capacity for payment","page_number":273,"box":{"x":116,"y":304,"width":767,"height":12}},{"id":"9ae12850-2db3-4346-ba73-02e985a07368","block_type":"box","text":"of financial commitments is considered strong. This capacity may, nevertheless, be more","page_number":273,"box":{"x":175,"y":320,"width":665,"height":12}},{"id":"3c5dfa5e-6ac7-4d2f-a3b9-81beff7e8b81","block_type":"box","text":"vulnerable to adverse business or economic conditions than is the case for higher ratings.","page_number":273,"box":{"x":175,"y":335,"width":671,"height":12}},{"id":"ab638333-3077-4250-8fb6-b578b0faf871","block_type":"box","text":"BBB Good Credit Quality. ‘BBB’ ratings indicate that expectations of credit risk are currently low.","page_number":273,"box":{"x":117,"y":358,"width":739,"height":12}},{"id":"39215b8e-a3b8-4682-8951-75f3b76e6da1","block_type":"box","text":"The capacity for payment of financial commitments is considered adequate, but adverse","page_number":273,"box":{"x":175,"y":374,"width":659,"height":12}},{"id":"07c4f8fe-1db6-42ac-af3b-dae51845a999","block_type":"box","text":"business or economic conditions are more likely to impair this capacity.","page_number":273,"box":{"x":176,"y":389,"width":532,"height":12}},{"id":"a736616d-903b-48ca-89c4-fec825be6068","block_type":"box","text":"BB Speculative. ‘BB’ ratings indicate an elevated vulnerability to credit risk, particularly in the event","page_number":273,"box":{"x":117,"y":413,"width":769,"height":12}},{"id":"be588ed7-3ba7-4707-baf8-35136400a499","block_type":"box","text":"of adverse changes in business or economic conditions over time; however, business or","page_number":273,"box":{"x":175,"y":428,"width":659,"height":12}},{"id":"3871ff60-c9e0-47b7-a7a3-adb67493afcc","block_type":"box","text":"financial alternatives may be available to allow financial commitments to be met.","page_number":273,"box":{"x":175,"y":444,"width":600,"height":12}},{"id":"c8f9dbdf-8829-45be-8af2-8b9c22e953aa","block_type":"box","text":"B Highly Speculative. ‘B’ ratings indicate that material credit risk is present.","page_number":273,"box":{"x":117,"y":467,"width":603,"height":12}},{"id":"902e0526-bb41-413e-a409-3f8f9c4ac2dc","block_type":"box","text":"CCC Substantial Credit Risk. ‘CCC’ ratings indicate that substantial credit risk is present.","page_number":273,"box":{"x":117,"y":490,"width":681,"height":12}},{"id":"31cbf124-8728-4bb0-8ef1-3e3f4e05c162","block_type":"box","text":"CC Very High Levels of Credit Risk. ‘CC’ ratings indicate very high levels of credit risk.","page_number":273,"box":{"x":117,"y":513,"width":675,"height":12}},{"id":"7d34681b-3386-4bed-9c9a-26bb647046a0","block_type":"box","text":"C Exceptionally High Levels of Credit Risk. ‘C’ indicates exceptionally high levels of credit risk.","page_number":273,"box":{"x":117,"y":537,"width":746,"height":12}},{"id":"5afbd81d-dadd-42d5-b28f-9ae313e7ec47","block_type":"box","text":"Within rating categories, Fitch may use modifiers. The modifiers “+” or “-” may be appended to a rating","page_number":273,"box":{"x":116,"y":568,"width":765,"height":12}},{"id":"b62d6003-e2a3-4db3-b071-b26cbbdd4551","block_type":"box","text":"to denote relative status within major rating categories.","page_number":273,"box":{"x":116,"y":583,"width":411,"height":12}},{"id":"62451914-fad4-43e8-80f2-1d9f986a855d","block_type":"box","text":"For example, the rating category ‘AA’ has three notch-specific rating levels (‘AA+’; ‘AA’; ‘AA–’; each a","page_number":273,"box":{"x":117,"y":614,"width":755,"height":12}},{"id":"e8025fc2-b54e-439a-babb-13bd2388d492","block_type":"box","text":"rating level). Such suffixes are not added to ‘AAA’ ratings and ratings below the ‘CCC’ category. For","page_number":273,"box":{"x":117,"y":630,"width":745,"height":12}},{"id":"f9ace0be-41fe-4c17-a682-bced7d9c87ea","block_type":"box","text":"the short-term rating category of ‘F1’, a ‘+’ may be appended.","page_number":273,"box":{"x":116,"y":645,"width":461,"height":12}},{"id":"7b071a28-02d7-494e-b04e-d8f9df04af2d","block_type":"box","text":"Description of Fitch’s Short-Term Ratings Assigned to Issuers and Obligations","page_number":273,"box":{"x":117,"y":676,"width":629,"height":12}},{"id":"e478b74d-e605-4538-95b6-989487c0fe0d","block_type":"box","text":"A short-term issuer or obligation rating is based in all cases on the short-term vulnerability to default of","page_number":273,"box":{"x":116,"y":707,"width":760,"height":12}},{"id":"43508eea-3e4e-4aee-8b48-0046b9538298","block_type":"box","text":"the rated entity and relates to the capacity to meet financial obligations in accordance with the","page_number":273,"box":{"x":116,"y":723,"width":696,"height":12}},{"id":"f531ff87-7b1c-43d6-b3fd-6122f3465409","block_type":"box","text":"documentation governing the relevant obligation. Short-term deposit ratings may be adjusted for loss","page_number":273,"box":{"x":116,"y":738,"width":748,"height":12}},{"id":"ad475ba5-266e-42d2-b802-3b10372dbb5a","block_type":"box","text":"severity. Short-term ratings are assigned to obligations whose initial maturity is viewed as “short term”","page_number":273,"box":{"x":116,"y":754,"width":755,"height":12}},{"id":"858dc917-3e7a-4791-8c28-2cffae216147","block_type":"box","text":"based on market convention. Typically, this means up to 13 months for corporate, sovereign, and","page_number":273,"box":{"x":117,"y":769,"width":720,"height":12}},{"id":"e9c0aa04-f012-44ed-beb3-6f96a157c544","block_type":"box","text":"structured obligations and up to 36 months for obligations in U.S. public finance markets.","page_number":273,"box":{"x":116,"y":785,"width":658,"height":12}},{"id":"b24f3fda-2057-4bbc-aedc-260f37954b24","block_type":"box","text":"Fitch short-term ratings are as follows:","page_number":273,"box":{"x":117,"y":816,"width":283,"height":12}},{"id":"ff9f0d29-f812-42b1-ba0c-f16b86f70b9d","block_type":"box","text":"F1 Highest Short-Term Credit Quality. Indicates the strongest intrinsic capacity for timely payment","page_number":273,"box":{"x":117,"y":847,"width":765,"height":12}},{"id":"2878ccc8-940c-417a-b5d6-9fcc66e4a17f","block_type":"box","text":"of financial commitments; may have an added “+” to denote any exceptionally strong credit","page_number":273,"box":{"x":175,"y":862,"width":679,"height":12}},{"id":"9df5d748-b297-4bff-85b0-02a8efed2373","block_type":"box","text":"feature.","page_number":273,"box":{"x":175,"y":878,"width":61,"height":9}},{"id":"ab43bfab-a50e-4f9d-9c43-9a96406f1ebd","block_type":"box","text":"A-9","page_number":273,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"931a5848-f73c-4e84-82a5-620507f6f4ad","block_type":"box","text":"NM1026U-6004382-273/605","page_number":273,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9397096c-ccab-4761-8f3e-ef0f7580f721","block_type":"box","text":"F2 Good Short-Term Credit Quality.","page_number":274,"box":{"x":117,"y":87,"width":299,"height":12}},{"id":"9fff9d4f-4c54-4ed9-ba61-f746704629ca","block_type":"box","text":"Good intrinsic capacity for timely payment of financial","page_number":274,"box":{"x":423,"y":87,"width":400,"height":12}},{"id":"c6612d5d-89a4-4e68-b027-b3b57711385e","block_type":"box","text":"commitments.","page_number":274,"box":{"x":175,"y":103,"width":109,"height":9}},{"id":"a780964f-2730-4703-922a-5612d886b872","block_type":"box","text":"F3 Fair Short-Term Credit Quality.","page_number":274,"box":{"x":117,"y":126,"width":286,"height":12}},{"id":"39ca519d-8bee-421e-a9b2-763e0b10201a","block_type":"box","text":"The intrinsic capacity for timely payment of financial","page_number":274,"box":{"x":410,"y":126,"width":389,"height":12}},{"id":"04d96ef1-9dda-4681-b9a7-88a333b87ea3","block_type":"box","text":"commitments is adequate.","page_number":274,"box":{"x":175,"y":141,"width":201,"height":12}},{"id":"63e29b4c-4d0b-4d9b-81ea-ddbc9ce67e4c","block_type":"box","text":"B Speculative Short-Term Credit Quality. Minimal capacity for timely payment of financial","page_number":274,"box":{"x":117,"y":165,"width":707,"height":12}},{"id":"9995b234-2a2e-4f7a-9d9f-a0da817d4dc6","block_type":"box","text":"commitments, plus heightened vulnerability to near term adverse changes in financial and","page_number":274,"box":{"x":175,"y":180,"width":671,"height":12}},{"id":"c3b06f17-5229-4689-ad0f-3f2e3d49d00a","block_type":"box","text":"economic conditions.","page_number":274,"box":{"x":175,"y":196,"width":161,"height":9}},{"id":"5b0cf5bd-dde8-4fbc-8dc7-234f61242a37","block_type":"box","text":"C High Short-Term Default Risk.","page_number":274,"box":{"x":117,"y":219,"width":281,"height":12}},{"id":"7f9a7d8e-ac80-4c52-a839-6038209dfe4f","block_type":"box","text":"Default is a real possibility.","page_number":274,"box":{"x":405,"y":219,"width":203,"height":12}},{"id":"82fa6e29-2d67-4ef6-9920-5a1141db713b","block_type":"box","text":"RD Restricted Default. Indicates an entity that has defaulted on one or more of its financial","page_number":274,"box":{"x":117,"y":242,"width":705,"height":12}},{"id":"63f44668-a67c-410f-9048-0d2c97670194","block_type":"box","text":"commitments, although it continues to meet other financial obligations. Typically applicable to","page_number":274,"box":{"x":175,"y":258,"width":697,"height":12}},{"id":"d38e44fb-f037-41ac-a4ce-df5b014e81a1","block_type":"box","text":"entity ratings only.","page_number":274,"box":{"x":175,"y":273,"width":140,"height":12}},{"id":"c928ae10-cee5-4272-b79b-34bdbc398109","block_type":"box","text":"D Default. Indicates a broad-based default event for an entity, or the default of a short-term","page_number":274,"box":{"x":117,"y":296,"width":721,"height":12}},{"id":"792c0c29-73d9-43de-bd49-2a20763760aa","block_type":"box","text":"obligation.","page_number":274,"box":{"x":175,"y":312,"width":81,"height":12}},{"id":"4284484d-dc3a-411e-893b-839727dac588","block_type":"box","text":"A-10","page_number":274,"box":{"x":482,"y":909,"width":35,"height":9}},{"id":"3d233cd2-c1d3-4275-9e74-4aa691c4ec70","block_type":"box","text":"NM1026U-6004382-274/605","page_number":274,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b8ccf1a0-7360-408c-9477-709c7c0662b2","block_type":"box","text":"Open-End Active and Fixed Income Index Fund Proxy Voting Policy","page_number":275,"box":{"x":380,"y":87,"width":508,"height":12}},{"id":"f616c191-29a5-4343-a7e8-676417a7f2a4","block_type":"box","text":"Appendix B","page_number":275,"box":{"x":453,"y":118,"width":98,"height":11}},{"id":"67c581b0-54f6-4949-ab91-adccb465f5c9","block_type":"box","text":"Open-End Active and Fixed Income Index Fund Proxy Voting Policy","page_number":275,"box":{"x":230,"y":148,"width":544,"height":12}},{"id":"340efdbe-535e-4dac-b5f4-4d4a1b9a4b50","block_type":"box","text":"Procedures Governing Delegation of Proxy Voting to Fund Advisers","page_number":275,"box":{"x":229,"y":178,"width":547,"height":12}},{"id":"8cb0dc7f-f34b-46f7-92bc-79aa1c99fbd7","block_type":"box","text":"Effective Date: January 1, 2025","page_number":275,"box":{"x":383,"y":209,"width":239,"height":12}},{"id":"433c0c34-9b46-4a99-83f1-a4c3507ba438","block_type":"box","text":"Applies to the following types of Funds registered under the 1940 Act:","page_number":275,"box":{"x":116,"y":247,"width":566,"height":12}},{"id":"773fb4a1-6262-41c8-98fe-1c07b7c1ca83","block_type":"box","text":"‘","page_number":275,"box":{"x":116,"y":276,"width":16,"height":12}},{"id":"5e370c76-ca5f-41ef-80af-33d2a8a9efe1","block_type":"box","text":"Index Equity Mutual Funds and Exchange-Traded Funds","page_number":275,"box":{"x":132,"y":277,"width":444,"height":12}},{"id":"76c05433-c546-43f3-92d1-bb00064f783e","block_type":"box","text":"È","page_number":275,"box":{"x":116,"y":292,"width":16,"height":12}},{"id":"a3f7f524-c2bb-40d1-a643-7f534ae1c0df","block_type":"box","text":"Open-End Active and Fixed Income Index Mutual Funds and Exchange-Traded Funds","page_number":275,"box":{"x":132,"y":293,"width":663,"height":12}},{"id":"fd174117-6b2c-4cb9-aba0-fa7967b2c214","block_type":"box","text":"‘","page_number":275,"box":{"x":116,"y":307,"width":16,"height":12}},{"id":"2503c3f9-09ee-42fc-a6f6-e7a06320a23d","block_type":"box","text":"Money Market Funds","page_number":275,"box":{"x":132,"y":308,"width":180,"height":12}},{"id":"67d1aa29-6144-4b33-b5d3-bfe6caef6b51","block_type":"box","text":"‘","page_number":275,"box":{"x":116,"y":323,"width":16,"height":12}},{"id":"b3cdf369-2318-4e3a-a3e1-c73a97b09167","block_type":"box","text":"Closed-End Funds","page_number":275,"box":{"x":132,"y":324,"width":161,"height":9}},{"id":"3007d938-b859-4b1f-b801-7745228e821d","block_type":"box","text":"‘","page_number":275,"box":{"x":116,"y":338,"width":16,"height":12}},{"id":"87418c97-8eb5-4db1-96c1-993c73835cb5","block_type":"box","text":"Other","page_number":275,"box":{"x":132,"y":339,"width":64,"height":10}},{"id":"cceabb66-414e-4ae8-84f0-44d5865b1e2e","block_type":"box","text":"Objective and Scope","page_number":275,"box":{"x":116,"y":369,"width":170,"height":13}},{"id":"5077c846-71c4-4c6a-af38-0808516ba764","block_type":"box","text":"Set forth below is the Open-End Active and Fixed Income Index Fund Proxy Voting Policy.","page_number":275,"box":{"x":116,"y":400,"width":675,"height":12}},{"id":"d0bbd982-c8fe-4967-811f-6b7236bf46a2","block_type":"box","text":"Policy / Document Requirements and Statements","page_number":275,"box":{"x":117,"y":430,"width":396,"height":12}},{"id":"94fc1b77-930e-46a7-90f0-82929c6c1593","block_type":"box","text":"The Boards of Trustees/Directors (“Directors”) of certain open-end funds (the “Funds”) advised by","page_number":275,"box":{"x":116,"y":461,"width":730,"height":12}},{"id":"ea07278f-439e-4cba-b591-23727209c5d8","block_type":"box","text":"BlackRock Fund Advisors or BlackRock Advisors, LLC (“BlackRock”), have the responsibility for the","page_number":275,"box":{"x":117,"y":476,"width":743,"height":12}},{"id":"be29d809-54e9-44bc-bacf-55b87c0808cf","block_type":"box","text":"oversight of voting proxies relating to portfolio securities of the Funds, and have determined that it is in","page_number":275,"box":{"x":116,"y":492,"width":765,"height":12}},{"id":"24e97e50-a7f3-439e-be06-432c738b544a","block_type":"box","text":"the best interests of the Funds and their shareholders to delegate the responsibility to vote proxies to","page_number":275,"box":{"x":116,"y":507,"width":754,"height":12}},{"id":"09ae34eb-427f-45b9-a49f-0c985624b2a3","block_type":"box","text":"BlackRock, subject to the principles outlined in this Policy, as part of BlackRock’s authority to manage,","page_number":275,"box":{"x":117,"y":523,"width":764,"height":12}},{"id":"c46008d3-73de-4b2f-8bbc-24782d3e0628","block_type":"box","text":"acquire and dispose of account assets, all as contemplated by the Funds’ respective investment","page_number":275,"box":{"x":116,"y":538,"width":718,"height":12}},{"id":"7a87b533-b25a-495b-aec5-fef8c961e5f9","block_type":"box","text":"management 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The team is responsible for establishing","page_number":280,"box":{"x":116,"y":180,"width":739,"height":12}},{"id":"26c31174-bc5c-4eeb-822c-b49510dc5122","block_type":"box","text":"voting guidelines for the active equity platform, providing vote recommendations and operationalizing","page_number":280,"box":{"x":116,"y":196,"width":754,"height":12}},{"id":"dfa866ff-98e5-4406-b74e-45e166af63f3","block_type":"box","text":"voting decisions. The guidance informs the voting recommendations BAIS makes to BlackRock’s","page_number":280,"box":{"x":116,"y":211,"width":724,"height":12}},{"id":"7fc020e1-e694-4b40-ab11-a503ca2ff29a","block_type":"box","text":"active portfolio managers. It applies to active equity holdings in BlackRock’s fundamental equity,","page_number":280,"box":{"x":116,"y":227,"width":719,"height":12}},{"id":"009c647d-b7a3-4654-9e56-01331da48af9","block_type":"box","text":"systematic equity and multi-asset solutions strategies. It also may apply to holdings in BlackRock’s","page_number":280,"box":{"x":116,"y":242,"width":737,"height":12}},{"id":"fa1b5e8d-4439-4949-817c-69bdd5710845","block_type":"box","text":"index and active fixed income strategies, to the extent those strategies hold voting securities or","page_number":280,"box":{"x":117,"y":258,"width":709,"height":12}},{"id":"6c8dbe4a-b16f-4ee5-acee-8ec8610424e4","block_type":"box","text":"conduct issuer engagements. The guidelines are not prescriptive as active portfolio managers have","page_number":280,"box":{"x":116,"y":273,"width":742,"height":12}},{"id":"3b299482-e89c-44de-a3f3-d375d9ff0ceb","block_type":"box","text":"discretion as to how they integrate these guidelines within their investment processes in light of their","page_number":280,"box":{"x":116,"y":289,"width":748,"height":12}},{"id":"d5dc9310-3bd0-44d9-bfb8-e7c5d611c17d","block_type":"box","text":"clients’ or funds’ investment objectives. There are separate, independently developed principles and","page_number":280,"box":{"x":116,"y":304,"width":748,"height":12}},{"id":"d19ce13b-6cf7-4f37-8abd-4eb5f60acc64","block_type":"box","text":"voting policies that are applied to BlackRock’s index equity investments by a distinct and independent","page_number":280,"box":{"x":116,"y":320,"width":758,"height":12}},{"id":"fa8e3b61-86b8-448d-87da-1030fc06f10e","block_type":"box","text":"function, BlackRock Investment Stewardship.","page_number":280,"box":{"x":116,"y":335,"width":341,"height":12}},{"id":"e3798ced-4f3a-45aa-be02-085aa48bbc9c","block_type":"box","text":"1","page_number":280,"box":{"x":144,"y":787,"width":2,"height":4}},{"id":"ed17cb3a-9805-4422-8d65-cb4a097bbbff","block_type":"box","text":"This document includes BAIS’ benchmark policy, which covers nearly all active equity holdings in BlackRock’s","page_number":280,"box":{"x":170,"y":787,"width":653,"height":9}},{"id":"d068206e-6bfe-4019-be10-efaf5d42e5cf","block_type":"box","text":"fundamental equity, systematic equity and multi-asset solutions strategies. The benchmark policy also may apply to","page_number":280,"box":{"x":170,"y":799,"width":685,"height":10}},{"id":"aa23b3b0-1828-4416-8b93-d4ce6cc846b8","block_type":"box","text":"holdings in BlackRock’s index and active fixed income strategies, to the extent those strategies hold voting securities or","page_number":280,"box":{"x":170,"y":812,"width":709,"height":10}},{"id":"23cc4f95-7cea-431c-b598-5d9ac5285d7d","block_type":"box","text":"conduct issuer engagements. This document also includes BAIS’ decarbonization policy, which covers holdings in","page_number":280,"box":{"x":170,"y":825,"width":676,"height":10}},{"id":"c071d41a-974b-41ee-8926-a3ce127c46b7","block_type":"box","text":"BlackRock active funds that have climate and decarbonization objectives in addition to financial objectives.","page_number":280,"box":{"x":171,"y":838,"width":631,"height":10}},{"id":"e8d63e67-53d2-4a6b-a560-d356a1e4b0e8","block_type":"box","text":"2","page_number":280,"box":{"x":143,"y":854,"width":4,"height":5}},{"id":"163ff5b2-33db-425d-95b8-c44e5abe7e47","block_type":"box","text":"BlackRock segmented active and index equity investment functions, including stewardship, in January 2025 as part of a","page_number":280,"box":{"x":171,"y":854,"width":709,"height":9}},{"id":"17d2e393-0b13-4d62-b2b0-382b227db7de","block_type":"box","text":"strategic initiative to unlock the full breadth of the firm’s active and private markets capabilities for clients. As a result,","page_number":280,"box":{"x":170,"y":867,"width":692,"height":9}},{"id":"99c038d4-43d9-4e11-af65-bec5af91c368","block_type":"box","text":"there are two stewardship teams, which operate independently of one another and have separate voting policies.","page_number":280,"box":{"x":170,"y":880,"width":669,"height":9}},{"id":"b5a2dca7-b5ad-45f5-9e9e-e40fee05e94d","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":280,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"2adfd949-dad8-4269-839b-c180aaef659b","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":280,"box":{"x":539,"y":909,"width":324,"height":12}},{"id":"0f989177-eb00-41e6-b7e2-3c2331e31acf","block_type":"box","text":"3","page_number":280,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"12af2d3f-eefe-4f7d-ba83-878da05f172a","block_type":"box","text":"NM1026U-6004382-280/605","page_number":280,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a53bfcfd-3dbe-4db5-b1ad-242c78e7f6c1","block_type":"box","text":"INTRODUCTION TO BLACKROCK","page_number":281,"box":{"x":366,"y":87,"width":273,"height":10}},{"id":"82d5678e-c473-4b14-83a5-b994516072a8","block_type":"box","text":"BlackRock’s mission is to help more people invest better. The money BlackRock manages is not its","page_number":281,"box":{"x":117,"y":117,"width":741,"height":12}},{"id":"bae0fc58-072d-4315-9008-ab6a66918425","block_type":"box","text":"own – it belongs to BlackRock’s clients, many of whom make their own asset allocation and portfolio","page_number":281,"box":{"x":116,"y":133,"width":749,"height":12}},{"id":"29116eb9-9384-4ced-bfae-8fd274bb6f2a","block_type":"box","text":"construction decisions. As a fiduciary, BlackRock invests on clients’ behalf to help them meet their","page_number":281,"box":{"x":116,"y":148,"width":733,"height":12}},{"id":"0dad3464-88f5-4fb7-9ba4-17c8ad6fd069","block_type":"box","text":"investment objectives. The firm does this by understanding clients’ long-term investment objectives","page_number":281,"box":{"x":117,"y":164,"width":739,"height":12}},{"id":"d24bb5e3-e605-4ed6-b1b7-b7803354f276","block_type":"box","text":"and offering choice on how and where they wish to invest their money. BlackRock then helps clients","page_number":281,"box":{"x":116,"y":179,"width":747,"height":12}},{"id":"f29d29b1-3b40-4472-be43-83299d846465","block_type":"box","text":"seek the best risk-adjusted returns based on those choices, underpinning this work with research, data","page_number":281,"box":{"x":116,"y":195,"width":768,"height":12}},{"id":"b7b737fd-65ff-4c25-a869-2018dda3860f","block_type":"box","text":"and analytics.","page_number":281,"box":{"x":116,"y":210,"width":107,"height":12}},{"id":"1944c9ed-0da2-44fd-a8aa-d43d5f0c560a","block_type":"box","text":"At BlackRock, investment stewardship is core to our role as an asset manager and a fiduciary to our","page_number":281,"box":{"x":116,"y":241,"width":748,"height":12}},{"id":"5b6b0641-50b8-46c9-9572-0cc795dd303c","block_type":"box","text":"clients. As stewards of our clients’ assets, we engage with companies to discuss the corporate","page_number":281,"box":{"x":116,"y":256,"width":706,"height":12}},{"id":"50bdf0fd-c27f-4d1d-828f-0b4ed163fbe2","block_type":"box","text":"governance and business practices that, in our experience, support companies in delivering durable,","page_number":281,"box":{"x":116,"y":272,"width":751,"height":12}},{"id":"f8d945b0-88c5-4009-835f-5ee493696d74","block_type":"box","text":"risk-adjusted financial returns over time. We are committed to building strong relationships through","page_number":281,"box":{"x":117,"y":287,"width":736,"height":12}},{"id":"e4e75775-10c1-4bdb-b542-534279297e27","block_type":"box","text":"constructive, ongoing dialogue with the boards and executive management of the companies in which","page_number":281,"box":{"x":116,"y":303,"width":760,"height":12}},{"id":"3b0fad41-ed64-4e7c-86af-6111315c93b3","block_type":"box","text":"our clients are invested.","page_number":281,"box":{"x":116,"y":318,"width":182,"height":10}},{"id":"af4f757d-fe55-4b99-aab4-11b65b50902d","block_type":"box","text":"ABOUT BLACKROCK ACTIVE INVESTMENT STEWARDSHIP","page_number":281,"box":{"x":259,"y":356,"width":486,"height":9}},{"id":"2e2264f7-7e50-489b-81f8-10462815d680","block_type":"box","text":"BlackRock Active Investment Stewardship (BAIS) is a specialist team within the Portfolio Management","page_number":281,"box":{"x":117,"y":386,"width":764,"height":12}},{"id":"4959bb77-c6ab-49b9-84dd-64fbebd8318b","block_type":"box","text":"Group and manages BlackRock’s stewardship engagement and voting on behalf of clients invested in","page_number":281,"box":{"x":117,"y":402,"width":758,"height":12}},{"id":"c967e168-f842-4ecd-a018-696d4a699ddf","block_type":"box","text":"active strategies globally. BAIS is also responsible for engagement with issuers in index fixed income","page_number":281,"box":{"x":116,"y":417,"width":755,"height":12}},{"id":"9ddd3ce9-4a6a-4967-aefa-f61fda5fd7c3","block_type":"box","text":"strategies, where appropriate. Our activities are informed by these Global Engagement and Voting","page_number":281,"box":{"x":116,"y":433,"width":735,"height":12}},{"id":"148d43fc-9310-477d-a963-6b5b4abc0cb7","block_type":"box","text":"Guidelines (the “Guidelines”) and insights from active investment analysts and portfolio managers, with","page_number":281,"box":{"x":117,"y":448,"width":768,"height":12}},{"id":"78878ca8-0a9c-49a0-a9db-0be32a96f742","block_type":"box","text":"whom we work closely in engaging companies and voting at shareholder meetings.","page_number":281,"box":{"x":116,"y":464,"width":622,"height":12}},{"id":"ba4d2f10-72d7-4a38-8cf1-281b87120e00","block_type":"box","text":"Engagement with public companies is the foundation of our approach to stewardship within","page_number":281,"box":{"x":117,"y":494,"width":680,"height":12}},{"id":"729f2608-c538-4410-bbcd-df9459b3d85a","block_type":"box","text":"fundamental active investing.","page_number":281,"box":{"x":116,"y":509,"width":215,"height":13}},{"id":"0e414509-2286-4766-ace5-be59d7b64daa","block_type":"box","text":"3","page_number":281,"box":{"x":333,"y":510,"width":5,"height":6}},{"id":"43bf3f40-f62b-43e4-a911-733c150bfd14","block_type":"box","text":"Through direct dialogue with company leadership, we seek to","page_number":281,"box":{"x":339,"y":510,"width":466,"height":12}},{"id":"b1b3b314-a899-4e0e-b7fd-8e06daad8538","block_type":"box","text":"understand their businesses and how they manage risks and opportunities to deliver durable, risk","page_number":281,"box":{"x":117,"y":525,"width":727,"height":12}},{"id":"89008dd9-1b40-411b-a9a2-f3785e015ab4","block_type":"box","text":"adjusted financial returns. Portfolio managers and stewardship specialists may engage jointly or","page_number":281,"box":{"x":116,"y":540,"width":716,"height":13}},{"id":"7e8a852e-1765-49f2-ba48-bbd497e3bb22","block_type":"box","text":"independently on material corporate governance matters. Our discussions focus on topics relevant to a","page_number":281,"box":{"x":117,"y":556,"width":769,"height":12}},{"id":"4a7b500e-70d6-41d6-958e-3ff3af584ec2","block_type":"box","text":"company’s success over time, including governance and leadership, corporate strategy, capital","page_number":281,"box":{"x":116,"y":572,"width":711,"height":12}},{"id":"155a81fb-300e-4bd0-ad3e-d7eb3029839f","block_type":"box","text":"structure and financial performance, operations and material sustainability-related risks, as well as","page_number":281,"box":{"x":116,"y":587,"width":734,"height":12}},{"id":"dcae51f2-14da-4227-a29f-c58da2313865","block_type":"box","text":"macro-economic, geopolitical and sector dynamics. We aim to be constructive investors and are","page_number":281,"box":{"x":117,"y":603,"width":717,"height":12}},{"id":"3f97f24f-7b15-4257-bd45-9cb9d47b93f2","block_type":"box","text":"generally supportive of management teams that have a track record of financial value creation. We aim","page_number":281,"box":{"x":116,"y":618,"width":770,"height":12}},{"id":"23049295-f4d0-4aae-8bde-beee6bd019a4","block_type":"box","text":"to build and maintain strong relationships with company leadership based on open dialogue and","page_number":281,"box":{"x":116,"y":634,"width":717,"height":12}},{"id":"e1d5c29c-eafa-45b9-9767-ee83a3cbac94","block_type":"box","text":"mutual respect.","page_number":281,"box":{"x":117,"y":649,"width":118,"height":12}},{"id":"7fd87efb-ccfe-481b-9fd8-1113411599b8","block_type":"box","text":"Different active equity strategies may implement these voting guidelines differently, as a result of the","page_number":281,"box":{"x":117,"y":679,"width":744,"height":12}},{"id":"33090975-bdaf-48ae-afbb-b70084e1e169","block_type":"box","text":"latitude each portfolio manager has to make independent voting decisions on their holdings. For","page_number":281,"box":{"x":117,"y":695,"width":711,"height":12}},{"id":"a89dd6a3-e435-4f77-a390-f93b5c86e4a2","block_type":"box","text":"example, BAIS will generally vote the holdings in Systematic Active Equity portfolios in accordance","page_number":281,"box":{"x":116,"y":710,"width":732,"height":12}},{"id":"d973a067-f59d-4d35-a1af-f064d2891a88","block_type":"box","text":"with these guidelines. We provide voting recommendations to fundamental equity portfolio managers,","page_number":281,"box":{"x":116,"y":726,"width":751,"height":12}},{"id":"011c38f1-1182-4e74-9a17-37ccd877519a","block_type":"box","text":"who may determine to vote differently based on each portfolio’s investment objectives and strategy.","page_number":281,"box":{"x":116,"y":741,"width":737,"height":12}},{"id":"58b0c3ed-becf-4b7e-9659-fa4e3b942607","block_type":"box","text":"These guidelines discuss BAIS’ views on corporate governance topics on which we may engage with","page_number":281,"box":{"x":116,"y":772,"width":749,"height":12}},{"id":"572d1c89-dc35-41f9-9018-e2a0f88cd700","block_type":"box","text":"management teams and board directors","page_number":281,"box":{"x":117,"y":787,"width":297,"height":12}},{"id":"e52dc56a-3afa-4bac-9fc2-8487c00b1cb1","block_type":"box","text":"4","page_number":281,"box":{"x":414,"y":787,"width":6,"height":6}},{"id":"5c938bf4-910f-47de-b290-4a80f6bc6ad6","block_type":"box","text":"and on matters that routinely come to a shareholder vote. We","page_number":281,"box":{"x":424,"y":787,"width":456,"height":12}},{"id":"01ef734d-df91-4a1e-82ec-a0a19affd697","block_type":"box","text":"3","page_number":281,"box":{"x":143,"y":812,"width":4,"height":5}},{"id":"38c0536c-592d-4b59-9d18-0015fbfe0e05","block_type":"box","text":"On February 11, 2025, the U.S. Securities and Exchange Commission (SEC) staff issued updated guidance for","page_number":281,"box":{"x":170,"y":812,"width":660,"height":10}},{"id":"3584c629-b0a6-44bc-934f-37a48baf4101","block_type":"box","text":"shareholders to maintain their eligibility to report their beneficial ownership under Schedule 13G of the Exchange Act.","page_number":281,"box":{"x":170,"y":825,"width":695,"height":10}},{"id":"db71d418-8778-4c69-b015-40cb9ae177b1","block_type":"box","text":"We comply fully with these requirements and do not engage with portfolio companies for the purpose, or with the effect,","page_number":281,"box":{"x":170,"y":838,"width":707,"height":10}},{"id":"f216b5c5-ec40-42b9-bf5f-2f74861caae4","block_type":"box","text":"of changing or influencing control of the company.","page_number":281,"box":{"x":170,"y":851,"width":295,"height":10}},{"id":"bb54c550-dfdc-446b-a3cf-f677bc0b9818","block_type":"box","text":"4","page_number":281,"box":{"x":143,"y":867,"width":4,"height":4}},{"id":"c70d9182-1244-47e5-b3b3-44bffc83c6ad","block_type":"box","text":"References to the board, board directors or non-executive directors should be understood to include supervisory boards","page_number":281,"box":{"x":171,"y":866,"width":710,"height":10}},{"id":"3125210d-962d-420e-aa06-593d0c5db486","block_type":"box","text":"and their members, where relevant.","page_number":281,"box":{"x":170,"y":879,"width":210,"height":9}},{"id":"f34dbebb-8c23-4848-861b-ce3cd98b06dd","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":281,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"7a4da77b-01ae-4722-abce-d71c5ccf626f","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":281,"box":{"x":539,"y":909,"width":324,"height":12}},{"id":"847fff88-9b39-439e-a7e5-a0beb1e5e500","block_type":"box","text":"4","page_number":281,"box":{"x":874,"y":909,"width":9,"height":9}},{"id":"345d4f85-7e69-4b12-9910-04e4190382d8","block_type":"box","text":"NM1026U-6004382-281/605","page_number":281,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6e8238d9-b01f-4ebc-bf96-feae381f640f","block_type":"box","text":"recognize that accepted corporate governance norms can differ across markets, and believe these","page_number":282,"box":{"x":117,"y":87,"width":736,"height":12}},{"id":"ae01d4c6-8959-48d9-bdad-29444761819e","block_type":"box","text":"guidelines represent globally applicable elements of governance that support a company’s ability to","page_number":282,"box":{"x":116,"y":102,"width":741,"height":13}},{"id":"fff2d200-12b1-46ab-8cbe-f62354637b15","block_type":"box","text":"manage material risks and opportunities and deliver financial returns to investors. Generally, we","page_number":282,"box":{"x":117,"y":118,"width":715,"height":12}},{"id":"c87c1556-38dc-4df1-b85f-039562ba90fc","block_type":"box","text":"believe companies should observe accepted corporate governance norms within their local markets or,","page_number":282,"box":{"x":117,"y":134,"width":768,"height":12}},{"id":"a96821d9-b1ea-4dac-8c8b-7f7b390b6e9c","block_type":"box","text":"particularly in markets without well-established norms, aspire to widely recognized international best","page_number":282,"box":{"x":117,"y":149,"width":746,"height":12}},{"id":"f4d0f9d4-d0ad-46e4-8468-8f90454838de","block_type":"box","text":"practices. As one of many minority shareholders, BlackRock cannot – and does not try to – direct a","page_number":282,"box":{"x":117,"y":165,"width":739,"height":12}},{"id":"e05d71b4-1cc8-43a9-930e-c2d76282e537","block_type":"box","text":"company’s strategy or its implementation. We look to companies to provide disclosures that explain","page_number":282,"box":{"x":116,"y":180,"width":743,"height":12}},{"id":"970d0d9c-6be4-44e3-b128-9e1e5752ea19","block_type":"box","text":"how their approach to corporate governance best aligns with the financial interests of their investors.","page_number":282,"box":{"x":117,"y":196,"width":749,"height":12}},{"id":"8393e54a-2295-4ea9-991b-dc9af03b88a2","block_type":"box","text":"OUR APPROACH TO STEWARDSHIP WITHIN ACTIVE EQUITIES","page_number":282,"box":{"x":246,"y":234,"width":513,"height":11}},{"id":"62bf2045-ece8-4525-8cad-9ac12917bc14","block_type":"box","text":"Voting at a company’s shareholder meeting is a right of share ownership and a core principle of","page_number":282,"box":{"x":116,"y":265,"width":713,"height":12}},{"id":"d974ba94-4462-428e-a0fd-93d1450c8424","block_type":"box","text":"corporate governance. The voting rights attached to clients’ holdings are an important mechanism for","page_number":282,"box":{"x":116,"y":281,"width":756,"height":12}},{"id":"f3cd8f6e-1013-4de3-858c-8e7a3fa15370","block_type":"box","text":"investors to express support for, or concern about, a company’s performance. As a fiduciary,","page_number":282,"box":{"x":117,"y":296,"width":692,"height":12}},{"id":"2764d21c-b49c-485b-a47d-b1a1ceb46603","block_type":"box","text":"BlackRock is legally required to make proxy voting determinations, on behalf of clients who have","page_number":282,"box":{"x":117,"y":312,"width":720,"height":12}},{"id":"420cb8fe-4163-49ca-96ef-da51aac72f93","block_type":"box","text":"delegated voting authority to us, in a manner consistent with BlackRock’s contractual arrangements","page_number":282,"box":{"x":116,"y":327,"width":743,"height":12}},{"id":"0b8c71d3-1c5a-404f-95a4-8fdf2f42d7de","block_type":"box","text":"with clients and funds.","page_number":282,"box":{"x":116,"y":343,"width":170,"height":9}},{"id":"30c97529-d020-4d35-b148-384ed2df8661","block_type":"box","text":"In general, we tend to support the recommendations of the board of directors and management. As","page_number":282,"box":{"x":117,"y":374,"width":740,"height":12}},{"id":"a1513579-2828-4c4e-a884-5837058ecb0b","block_type":"box","text":"indicated below, we may vote against management recommendations when we have concerns about","page_number":282,"box":{"x":117,"y":389,"width":755,"height":12}},{"id":"b3edd7bc-18da-42c4-ac10-a3b446d64daa","block_type":"box","text":"how companies are serving the financial interests of our clients as their shareholders. BAIS takes a","page_number":282,"box":{"x":117,"y":405,"width":740,"height":12}},{"id":"d93e15fe-276e-4016-b0bd-e7c08e894d9e","block_type":"box","text":"globally consistent approach to voting but considers the different corporate governance regulations and","page_number":282,"box":{"x":116,"y":420,"width":772,"height":12}},{"id":"405c8a6c-700f-449e-a3df-bd2dbd084015","block_type":"box","text":"norms across markets. Votes are determined on a case-by-case basis, in the context of a company’s","page_number":282,"box":{"x":117,"y":436,"width":753,"height":12}},{"id":"43449929-cffc-4b73-ae35-b28fb76ac648","block_type":"box","text":"situation and the investment mandate we have from clients. Please see page 19 for more information","page_number":282,"box":{"x":116,"y":451,"width":756,"height":12}},{"id":"3db51742-b64e-446b-9498-322b945db8c1","block_type":"box","text":"about how we fulfill and oversee our investment stewardship responsibilities for BlackRock’s non-index","page_number":282,"box":{"x":116,"y":467,"width":768,"height":12}},{"id":"deba32fa-1802-4401-a7b2-21531a264cb1","block_type":"box","text":"equity strategies.","page_number":282,"box":{"x":116,"y":482,"width":125,"height":12}},{"id":"137c47fd-8e46-46ed-b25b-4afb4a48e8ab","block_type":"box","text":"5","page_number":282,"box":{"x":243,"y":483,"width":6,"height":6}},{"id":"d88a2ec8-f4cf-41d7-8a77-5e3ec8b4c336","block_type":"box","text":"OUR APPROACH TO STEWARDSHIP WITHIN FIXED INCOME","page_number":282,"box":{"x":257,"y":521,"width":490,"height":10}},{"id":"400d2d54-d8bf-4854-9691-90fc1ca2fdac","block_type":"box","text":"Although fixed income investors do not have the right to vote at shareholder meetings, issuer","page_number":282,"box":{"x":116,"y":552,"width":695,"height":12}},{"id":"7ad98e31-7591-4249-9753-1c33b192acb2","block_type":"box","text":"engagement is a component of fixed income investment strategies at BlackRock, particularly for those","page_number":282,"box":{"x":116,"y":568,"width":762,"height":12}},{"id":"2176ea4e-b49f-4a18-96d2-8d1502928ecd","block_type":"box","text":"with sustainability objectives in addition to financial objectives. Most corporate governance-related","page_number":282,"box":{"x":116,"y":583,"width":732,"height":12}},{"id":"7f6e6f22-0835-4a0e-8c6a-fb15fc6e4dc1","block_type":"box","text":"fixed income engagements are undertaken in conjunction with the active investment stewardship team,","page_number":282,"box":{"x":116,"y":599,"width":770,"height":12}},{"id":"abcdfd0f-6300-4ba3-824f-5a0426c267ce","block_type":"box","text":"and often active equity investors. In addition to the topics listed below, engagement with fixed income","page_number":282,"box":{"x":116,"y":614,"width":757,"height":12}},{"id":"a5811658-0ecd-4934-8731-9f332d4db340","block_type":"box","text":"investment teams may help inform an issuer’s approach to structuring specialist issuances and the","page_number":282,"box":{"x":117,"y":630,"width":736,"height":12}},{"id":"e6aeec6c-7532-4ba7-8e5e-d2b8241f6c28","block_type":"box","text":"standard terms and information in bond documentation.","page_number":282,"box":{"x":116,"y":645,"width":417,"height":10}},{"id":"a13bbb5f-9936-4045-b6c4-46a2ae3b548a","block_type":"box","text":"BOARDS OF DIRECTORS","page_number":282,"box":{"x":398,"y":684,"width":203,"height":9}},{"id":"ec6d51d3-b932-4ca0-ad7f-ad47169fcd29","block_type":"box","text":"Roles and responsibilities","page_number":282,"box":{"x":117,"y":715,"width":207,"height":12}},{"id":"2c667749-432c-49c7-8107-28cca5f78a1b","block_type":"box","text":"There is widespread consensus that the foundation of good corporate governance is an effective board","page_number":282,"box":{"x":116,"y":746,"width":764,"height":12}},{"id":"1e494fc5-b38e-4028-b44d-23ab47232829","block_type":"box","text":"of directors that is able to advise and supervise management in an independent and objective","page_number":282,"box":{"x":116,"y":761,"width":695,"height":13}},{"id":"4208ff4b-6de7-4e89-923b-c145baf13b2f","block_type":"box","text":"manner.","page_number":282,"box":{"x":117,"y":779,"width":59,"height":7}},{"id":"ad81bc8f-3037-4505-a446-76eecacaca0e","block_type":"box","text":"6","page_number":282,"box":{"x":178,"y":777,"width":5,"height":6}},{"id":"d7eb7cb9-74f3-4e51-b513-0d0a99244187","block_type":"box","text":"5","page_number":282,"box":{"x":143,"y":826,"width":4,"height":4}},{"id":"87754cb5-e8e9-4140-b0a8-bf0299e8c786","block_type":"box","text":"Non-index equity strategies include active equity holdings in BlackRock’s fundamental equity, systematic equity and","page_number":282,"box":{"x":171,"y":825,"width":685,"height":10}},{"id":"ab8fdbe1-93eb-437f-9086-e67004cea9a1","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":282,"box":{"x":170,"y":838,"width":678,"height":10}},{"id":"4ffb710b-9c37-438b-8eba-a567cce5d6ee","block_type":"box","text":"extent those strategies hold voting securities or conduct issuer engagements.","page_number":282,"box":{"x":170,"y":851,"width":458,"height":10}},{"id":"b9860f99-3770-4cb2-ab26-33ccdaf1c7de","block_type":"box","text":"6","page_number":282,"box":{"x":143,"y":867,"width":4,"height":5}},{"id":"afced414-8375-4ad2-aba9-3d0e88fd947e","block_type":"box","text":"See the Corporate Governance Codes of Germany, Japan, and the UK, as well as the corporate governance principles","page_number":282,"box":{"x":170,"y":867,"width":706,"height":9}},{"id":"7df4294e-4432-4aaa-8c85-d369317d5572","block_type":"box","text":"of the US Business Roundtable as examples.","page_number":282,"box":{"x":170,"y":880,"width":268,"height":9}},{"id":"d89a4652-c30d-41e5-852a-ea2eacc837b1","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":282,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"4789d967-dc25-4bb3-a9d0-040da8b47a92","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":282,"box":{"x":539,"y":909,"width":324,"height":12}},{"id":"292fd33e-8a0f-4811-8f06-e57240dc4fda","block_type":"box","text":"5","page_number":282,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"7587307d-8003-48de-a45f-8b9e18e1ede4","block_type":"box","text":"NM1026U-6004382-282/605","page_number":282,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ddcca7f3-bf59-4137-99c4-0e21546139cf","block_type":"box","text":"We look to the board of directors (hereafter the “board”) to have an oversight role in the establishment","page_number":283,"box":{"x":116,"y":87,"width":762,"height":12}},{"id":"72adb399-3e80-454c-be09-a6428f5f14dd","block_type":"box","text":"and realization of a company’s strategy, purpose and culture. These constructs are interdependent","page_number":283,"box":{"x":116,"y":102,"width":738,"height":13}},{"id":"4da5707a-dc29-4204-ab60-9cb3fa2ab01a","block_type":"box","text":"and, when aligned, can better position a company to be resilient in the face of a changing business","page_number":283,"box":{"x":116,"y":118,"width":739,"height":12}},{"id":"e77ebcb0-b373-42dd-9ecf-ec474264ba19","block_type":"box","text":"environment, help reduce the risks of corporate or employee misconduct, and attract and retain the","page_number":283,"box":{"x":116,"y":134,"width":740,"height":12}},{"id":"adea9553-c6e6-43d8-8eb6-bcc5072476ea","block_type":"box","text":"caliber of workers necessary to deliver financial performance over time.","page_number":283,"box":{"x":116,"y":149,"width":535,"height":12}},{"id":"32f6a2cb-cea0-4071-887a-c6739df4b339","block_type":"box","text":"In overseeing the management of the company, the board ensures the necessary resources, policies","page_number":283,"box":{"x":117,"y":178,"width":754,"height":12}},{"id":"9e894199-52ac-4897-8198-fd0672dac61d","block_type":"box","text":"and procedures are in place to help management meet its strategic objectives within an agreed risk","page_number":283,"box":{"x":116,"y":194,"width":742,"height":12}},{"id":"7824490a-6bee-4e7f-8eae-1799d23a336f","block_type":"box","text":"tolerance.","page_number":283,"box":{"x":116,"y":210,"width":78,"height":9}},{"id":"1e8da2ce-0a99-4c97-adab-67793965580c","block_type":"box","text":"One of the most important responsibilities of the board is to appoint, and remove as necessary, the","page_number":283,"box":{"x":116,"y":239,"width":739,"height":12}},{"id":"e07c7eab-2796-4b75-bb72-00702211b6ea","block_type":"box","text":"chief executive officer (“CEO”). In addition, the board plays a meaningful role in monitoring the","page_number":283,"box":{"x":116,"y":254,"width":704,"height":12}},{"id":"7f28cdfc-c710-49d3-b901-1d8c4fea1586","block_type":"box","text":"performance of the CEO and other key executives, determining executive compensation, ensuring a","page_number":283,"box":{"x":117,"y":270,"width":747,"height":12}},{"id":"8595c840-0988-4d4d-b8ae-e9e8bc291270","block_type":"box","text":"rigorous audit, overseeing strategy execution and risk management and engaging with shareholders,","page_number":283,"box":{"x":117,"y":285,"width":753,"height":12}},{"id":"0c760d08-98f2-4f0e-baa7-24925bf3a4a3","block_type":"box","text":"and other stakeholders, as necessary.","page_number":283,"box":{"x":116,"y":301,"width":289,"height":12}},{"id":"c21fd413-9c22-4a21-a0d5-245fff2c9d17","block_type":"box","text":"Composition and effectiveness","page_number":283,"box":{"x":116,"y":330,"width":253,"height":12}},{"id":"0080c88a-bd2a-48d2-9f84-97cb51518735","block_type":"box","text":"Appointment process","page_number":283,"box":{"x":116,"y":359,"width":177,"height":12}},{"id":"358afb48-1b42-422b-a0c6-e513ff809f07","block_type":"box","text":"A formal and transparent process for identifying and appointing director candidates is critical to","page_number":283,"box":{"x":116,"y":389,"width":708,"height":12}},{"id":"5620be68-3514-4eec-8fd4-96bfd34f3996","block_type":"box","text":"ensuring the board is composed of directors with the appropriate mix of skills and experience.","page_number":283,"box":{"x":116,"y":404,"width":700,"height":12}},{"id":"1e51c4c3-b248-4526-a5e9-c6000eee0e5f","block_type":"box","text":"Generally, the board or a sub-committee determines the general criteria given the company’s","page_number":283,"box":{"x":117,"y":420,"width":695,"height":12}},{"id":"01168ccf-c5f3-40ff-a54d-d2667fc2b1ab","block_type":"box","text":"circumstances (e.g., sector, maturity, geographic footprint) and any additional criteria for a specific role","page_number":283,"box":{"x":116,"y":435,"width":767,"height":12}},{"id":"86fd9ea0-9e96-4101-bcb3-ee1449e1a499","block_type":"box","text":"being filled (e.g., financial expertise, industry track record). To inform the process, we encourage","page_number":283,"box":{"x":117,"y":451,"width":721,"height":12}},{"id":"161e92f5-b2d4-44d1-ad6b-38eed570efe5","block_type":"box","text":"companies to review the skills and experience of incumbent directors to identify any gaps and whether","page_number":283,"box":{"x":116,"y":466,"width":764,"height":12}},{"id":"19fe9514-0109-4230-8ebd-9718e64cc5f6","block_type":"box","text":"the skills and experience of a director candidate would be additive. We welcome disclosures that","page_number":283,"box":{"x":116,"y":482,"width":722,"height":12}},{"id":"4d5479c7-e457-4f08-9a1a-05861bd0ee43","block_type":"box","text":"explain how the board considered different skills and experience to ensure that the directors","page_number":283,"box":{"x":116,"y":497,"width":687,"height":12}},{"id":"d3e43ffa-8e8a-4c7b-ae36-756a59d2a38d","block_type":"box","text":"collectively can be effective in fulfilling their responsibilities. We assess a company’s board","page_number":283,"box":{"x":116,"y":513,"width":678,"height":12}},{"id":"531ba903-8917-4bec-bf52-f55b39a18178","block_type":"box","text":"composition against that of its peer group and local market requirements.","page_number":283,"box":{"x":116,"y":528,"width":548,"height":12}},{"id":"57525427-4a39-456b-ad52-c4ba4dff4ecd","block_type":"box","text":"Shareholders periodically vote to elect directors to serve on the board. We do not prescribe any","page_number":283,"box":{"x":116,"y":558,"width":714,"height":12}},{"id":"97968a9d-ddd7-46c8-bc06-b7c664415270","block_type":"box","text":"particular board composition in our engagements or voting but seek to understand how well placed a","page_number":283,"box":{"x":117,"y":573,"width":751,"height":12}},{"id":"07e446d5-6c75-4333-b47a-91069c053267","block_type":"box","text":"board is to act in investors’ interests. We may vote against the election of the most senior independent","page_number":283,"box":{"x":117,"y":589,"width":764,"height":12}},{"id":"c5fd97b0-e24c-4586-8e68-a8a4a17c1fe5","block_type":"box","text":"director, or the chair of the relevant committee, where a company has not demonstrated it has an","page_number":283,"box":{"x":116,"y":604,"width":726,"height":12}},{"id":"6048792a-762b-4a88-8c4c-bd2d5f3b94ec","block_type":"box","text":"appointment process that results in a high functioning board with the appropriate complement of skills","page_number":283,"box":{"x":116,"y":620,"width":759,"height":12}},{"id":"1440dbc4-78ca-4c43-b802-ed04d37b26eb","block_type":"box","text":"and experience amongst the directors to support strong financial performance over time. We may vote","page_number":283,"box":{"x":116,"y":635,"width":764,"height":12}},{"id":"c888e8b8-a3ee-4c0f-8ad6-142f68d08a6d","block_type":"box","text":"against newly nominated directors who do not seem to have the appropriate skills or experience to","page_number":283,"box":{"x":116,"y":651,"width":736,"height":12}},{"id":"cfc2955a-755f-4f2c-a360-34e032f8dde7","block_type":"box","text":"contribute to the board’s effectiveness.","page_number":283,"box":{"x":116,"y":666,"width":286,"height":10}},{"id":"3d870fb9-48bd-40c6-9b02-9aaf5603ccbc","block_type":"box","text":"Independence","page_number":283,"box":{"x":116,"y":696,"width":113,"height":11}},{"id":"ad77702c-380e-4c6d-8210-e993d4f7e811","block_type":"box","text":"Director independence from management, significant shareholders or other stakeholders (e.g.,","page_number":283,"box":{"x":117,"y":725,"width":700,"height":12}},{"id":"0ad521cf-03e1-4faa-b03f-3effe7ca2c31","block_type":"box","text":"government or employees) is of paramount importance to the protection of the interests of minority","page_number":283,"box":{"x":116,"y":740,"width":732,"height":12}},{"id":"717910c0-c91f-488b-abb2-afca996e4e05","block_type":"box","text":"shareholders such as BlackRock’s clients. We consider it good practice for at least half the directors to","page_number":283,"box":{"x":116,"y":756,"width":761,"height":12}},{"id":"151eb156-0a69-4633-820c-457ae29c8fa9","block_type":"box","text":"be independent and free from conflicts of interest or undue influence.","page_number":283,"box":{"x":117,"y":771,"width":510,"height":12}},{"id":"0b463a6c-5147-43e5-9ac2-1d1f10e454dc","block_type":"box","text":"7","page_number":283,"box":{"x":629,"y":771,"width":5,"height":6}},{"id":"c3aa9bb0-363f-4d87-ab6d-e32dbb7d64b7","block_type":"box","text":"This also helps to ensure that","page_number":283,"box":{"x":640,"y":771,"width":219,"height":12}},{"id":"7f5047cd-8a47-4bfc-9cd8-c67b308c3ef7","block_type":"box","text":"board committees are composed of a sufficient number of independent directors. Companies domiciled","page_number":283,"box":{"x":117,"y":787,"width":764,"height":12}},{"id":"500d873f-e906-420a-9ca2-ad111e1fed61","block_type":"box","text":"in markets with a higher threshold for board independence should meet those local requirements.","page_number":283,"box":{"x":117,"y":802,"width":720,"height":12}},{"id":"2c5f8948-537f-44f9-89c3-3cee18d7fd06","block_type":"box","text":"7","page_number":283,"box":{"x":143,"y":828,"width":4,"height":4}},{"id":"b5445bd3-1414-4f82-8278-9cf8201e7844","block_type":"box","text":"Common impediments to independence may include but are not limited to: current or recent employment at the","page_number":283,"box":{"x":170,"y":827,"width":659,"height":10}},{"id":"604a366a-2e40-4cdc-86c7-2180be5a7cf8","block_type":"box","text":"company or a subsidiary; being, or representing, a shareholder with a substantial shareholding in the company;","page_number":283,"box":{"x":170,"y":840,"width":659,"height":10}},{"id":"de880148-9ce7-4a85-8ee5-ca52c18889b9","block_type":"box","text":"interlocking directorships; lengthy tenure, and having any other interest, business, or other relationship which could, or","page_number":283,"box":{"x":170,"y":853,"width":702,"height":10}},{"id":"aa41f073-14dd-4a46-9034-da688367122a","block_type":"box","text":"could reasonably be perceived to, materially interfere with a director’s ability to act in the best interests of the company","page_number":283,"box":{"x":170,"y":866,"width":703,"height":10}},{"id":"18751393-af44-4430-9d0e-611c3f31f136","block_type":"box","text":"and shareholders.","page_number":283,"box":{"x":170,"y":879,"width":106,"height":8}},{"id":"fe12ca37-76ca-4337-8159-bd547bb3780d","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":283,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"5000b9c7-eeff-4305-8ca2-0b3425c1cfd2","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":283,"box":{"x":539,"y":909,"width":324,"height":12}},{"id":"1709164d-7e52-4501-9641-b71eaafdf757","block_type":"box","text":"6","page_number":283,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"66849cdf-a07d-41d4-89c5-f97530452f51","block_type":"box","text":"NM1026U-6004382-283/605","page_number":283,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4a454b19-7492-484f-8588-399eb7b9356c","block_type":"box","text":"We may vote against the election of non-independent directors if the board does not have a sufficient","page_number":284,"box":{"x":116,"y":87,"width":756,"height":12}},{"id":"ad82223e-3f3c-4027-b70b-7e3e91887776","block_type":"box","text":"balance of independence. We may also vote against the election of the chair of the committee","page_number":284,"box":{"x":117,"y":102,"width":701,"height":13}},{"id":"f06d030b-4201-4bc8-be2f-41c83fde7b41","block_type":"box","text":"responsible for board composition if this is a perennial issue.","page_number":284,"box":{"x":117,"y":118,"width":453,"height":12}},{"id":"c4da031a-aa7c-44f4-ac71-507c13b189f8","block_type":"box","text":"Independent board leadership","page_number":284,"box":{"x":116,"y":149,"width":245,"height":12}},{"id":"aadebdf8-3979-4d64-b94d-2d287608e18f","block_type":"box","text":"Practices across markets differ, as do board structures, but we observe two main approaches to","page_number":284,"box":{"x":117,"y":180,"width":718,"height":12}},{"id":"8972af39-24c5-46a8-ba2a-80fbcba3ae0b","block_type":"box","text":"independent board leadership. One is a non-executive, independent chair of the board who is","page_number":284,"box":{"x":117,"y":196,"width":697,"height":11}},{"id":"8b2c863b-b666-4f01-809f-be2889b0a409","block_type":"box","text":"responsible for leading the board in the effective exercise of its duties. The other is a lead or senior","page_number":284,"box":{"x":117,"y":211,"width":738,"height":12}},{"id":"c04ed7e0-29cc-4234-931e-d5332115bdcf","block_type":"box","text":"independent director, who is responsible for coordinating with the other non-executive directors and","page_number":284,"box":{"x":117,"y":227,"width":742,"height":12}},{"id":"30c57224-5dc0-415d-a2c5-40dae838e4f8","block_type":"box","text":"working closely with the executive chair on the board agenda and other board procedures. In this case,","page_number":284,"box":{"x":116,"y":242,"width":770,"height":12}},{"id":"c3e615fc-cee9-4aa5-ad05-bd96800fc519","block_type":"box","text":"the executive chair and the lead independent director work together to ensure the board is effectively","page_number":284,"box":{"x":116,"y":258,"width":754,"height":12}},{"id":"13fdcaf8-abe5-4e65-b57a-9bd552c38150","block_type":"box","text":"fulfilling its responsibilities. In our view, the independent leader of the board, and/or the chair of a","page_number":284,"box":{"x":116,"y":273,"width":723,"height":12}},{"id":"6668acf8-9c9f-4757-8832-597cece90d68","block_type":"box","text":"relevant committee, should be available to investors to discuss governance matters such as CEO","page_number":284,"box":{"x":117,"y":289,"width":727,"height":12}},{"id":"0fd1dfee-3c03-46e7-b0d1-c88a8933a537","block_type":"box","text":"succession, executive pay, and board performance. We look to boards to explain their board","page_number":284,"box":{"x":116,"y":304,"width":691,"height":12}},{"id":"d7837988-1629-4bba-8871-3d90ccd6ad8d","block_type":"box","text":"leadership model and how it serves the interests of shareholders.","page_number":284,"box":{"x":117,"y":320,"width":489,"height":12}},{"id":"abc57eed-bc26-42b0-a7e4-67d61b34fbcd","block_type":"box","text":"We may vote against the election of the chair of the committee responsible for board composition if","page_number":284,"box":{"x":116,"y":351,"width":740,"height":12}},{"id":"87a333ea-a1a0-401e-a1ef-e312260f093f","block_type":"box","text":"there is not an identified independent leader of the board with clear responsibilities for board","page_number":284,"box":{"x":116,"y":366,"width":689,"height":12}},{"id":"a36c8cae-d6b2-4c02-baef-6881e7cbaf16","block_type":"box","text":"performance. We may vote against the most senior independent director if the board has a policy of","page_number":284,"box":{"x":117,"y":382,"width":744,"height":12}},{"id":"454b3a19-036b-4350-bfd3-bde0078609f0","block_type":"box","text":"not engaging with shareholders.","page_number":284,"box":{"x":117,"y":397,"width":242,"height":12}},{"id":"421d2b85-4065-4692-99b1-d71264702c9e","block_type":"box","text":"Tenure and succession","page_number":284,"box":{"x":118,"y":428,"width":189,"height":10}},{"id":"55ee4c49-0474-42be-a61b-7f31a3bcbe49","block_type":"box","text":"In our view, it is good practice for boards to establish the length of time a director would normally be","page_number":284,"box":{"x":117,"y":459,"width":745,"height":12}},{"id":"6327c1b7-9adb-461d-b0a1-1f1acd3ec4f9","block_type":"box","text":"expected to serve, in line with market norms where those exist. We find it helpful when companies","page_number":284,"box":{"x":116,"y":475,"width":733,"height":12}},{"id":"c632bc4b-4e7a-4edd-af59-4b8a320f5d73","block_type":"box","text":"disclose their approach to director tenure particularly around the contributions of directors who have","page_number":284,"box":{"x":116,"y":490,"width":745,"height":12}},{"id":"6731d440-a3f6-44fc-a077-51c52257aa8d","block_type":"box","text":"served for longer periods than typically provided for under local practice. In our experience, long","page_number":284,"box":{"x":116,"y":506,"width":718,"height":12}},{"id":"b8abcdb8-36c0-4a2d-8732-b2df26e2d374","block_type":"box","text":"serving directors could become less independent given their long-term relationship with management","page_number":284,"box":{"x":116,"y":521,"width":755,"height":12}},{"id":"043b20d4-7e0c-4852-b615-06debf30f3f4","block_type":"box","text":"and involvement in past board decisions.","page_number":284,"box":{"x":116,"y":537,"width":308,"height":12}},{"id":"348d86db-7cb7-4f34-ad4f-de16ab06f86e","block_type":"box","text":"Succession planning for board roles helps achieve the appropriate cadence of turnover that balances","page_number":284,"box":{"x":116,"y":568,"width":756,"height":12}},{"id":"f10a6457-5834-4151-ada0-8712ece321bd","block_type":"box","text":"renewal through the regular introduction of directors with fresh perspectives and expertise with","page_number":284,"box":{"x":117,"y":583,"width":705,"height":12}},{"id":"7952105c-ebe3-4fb3-a5ae-56d6d6725b49","block_type":"box","text":"continuity through the retention of directors with long-term knowledge of the board and company.","page_number":284,"box":{"x":116,"y":599,"width":724,"height":12}},{"id":"cfe0c838-9c59-446d-b0c6-187fbac24cc2","block_type":"box","text":"In markets where there is not specific director tenure guidance from regulation or corporate","page_number":284,"box":{"x":117,"y":630,"width":680,"height":12}},{"id":"a7fce374-e7c4-4088-9d4f-58362740e35f","block_type":"box","text":"governance best practices, we may vote against the election of the chair of the committee responsible","page_number":284,"box":{"x":116,"y":645,"width":763,"height":12}},{"id":"cdff2f0a-53fd-4ad7-81e3-67e38f4f54f6","block_type":"box","text":"for board composition if a company does not clearly disclose its approach to director tenure and board","page_number":284,"box":{"x":116,"y":661,"width":757,"height":12}},{"id":"3d792752-ca92-48e8-84fe-8bb7407395e3","block_type":"box","text":"renewal. We may vote against the election of directors who have served for more years than is typical","page_number":284,"box":{"x":117,"y":676,"width":754,"height":12}},{"id":"6cf07692-4ba1-435c-af74-7a6194a91fd2","block_type":"box","text":"in markets with specific guidance, where the case for their continued service is not evident.","page_number":284,"box":{"x":117,"y":692,"width":673,"height":12}},{"id":"048d996b-e2ae-4613-b1c3-7a49742c0fe2","block_type":"box","text":"Capacity","page_number":284,"box":{"x":117,"y":723,"width":70,"height":12}},{"id":"c6441741-5761-4428-b339-86102c78797c","block_type":"box","text":"To be effective and engaged, directors need to have the time and energy to commit to the role. In our","page_number":284,"box":{"x":116,"y":754,"width":753,"height":12}},{"id":"d162d78e-47fb-4b14-a319-43d1290fcae8","block_type":"box","text":"view, an effective board will assess the ability of its members to maintain an appropriate focus on","page_number":284,"box":{"x":116,"y":769,"width":720,"height":12}},{"id":"558f1594-4eb8-4734-961e-9d4ed7b42602","block_type":"box","text":"board matters and the company taking into consideration competing responsibilities. We recognize that","page_number":284,"box":{"x":117,"y":785,"width":765,"height":12}},{"id":"f9b37b25-8cdc-40a7-bbdc-fb452b9aecbb","block_type":"box","text":"board leadership roles vary across markets in responsibilities and required time commitment but note","page_number":284,"box":{"x":117,"y":800,"width":750,"height":12}},{"id":"de0c358b-33e5-4cd9-812c-ff9d28fdb6b9","block_type":"box","text":"that they are generally more intensive than a standard directorship. We will take local norms and","page_number":284,"box":{"x":116,"y":816,"width":715,"height":12}},{"id":"906283f0-373b-49d0-9db8-1c63405f5f24","block_type":"box","text":"practices into consideration when making our voting determinations across markets.","page_number":284,"box":{"x":117,"y":831,"width":628,"height":12}},{"id":"ea46262a-8d1c-4ca8-a716-1de2c2928dd9","block_type":"box","text":"We may vote against the election of directors who do not seem to have sufficient capacity to effectively","page_number":284,"box":{"x":116,"y":862,"width":769,"height":12}},{"id":"ea6e7be0-5df9-4ba8-9776-a90cf7a7ab0b","block_type":"box","text":"fulfil their duties to the board and company.","page_number":284,"box":{"x":116,"y":878,"width":326,"height":12}},{"id":"38f79bbf-0511-4e0e-bd3b-71b8288936b7","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":284,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"6d4f80ac-02c2-4933-b955-5dfe14b28507","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":284,"box":{"x":539,"y":909,"width":324,"height":12}},{"id":"d18691a1-8819-4e99-8cb0-54f2cae92a6f","block_type":"box","text":"7","page_number":284,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"394a6c9a-9ea0-43e7-bd98-528f6cbedda5","block_type":"box","text":"NM1026U-6004382-284/605","page_number":284,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4f1ec03a-faa6-4c3c-9495-cfecd8a43756","block_type":"box","text":"Director elections","page_number":285,"box":{"x":116,"y":87,"width":147,"height":10}},{"id":"042ebe08-77da-4b47-a945-e97c44687815","block_type":"box","text":"Regular election of directors, ideally annually, supports director accountability to shareholders. A","page_number":285,"box":{"x":117,"y":116,"width":720,"height":13}},{"id":"247aef74-25ac-4019-957d-dc02f6f6a9d1","block_type":"box","text":"classified board structure","page_number":285,"box":{"x":116,"y":132,"width":186,"height":10}},{"id":"ab29cc57-0be0-4f10-b66b-9ad399a08c86","block_type":"box","text":"8","page_number":285,"box":{"x":303,"y":132,"width":5,"height":6}},{"id":"4d2d6127-4aa3-4d9f-8858-2ed861eade6f","block_type":"box","text":"may be justified by a company when it needs consistency and stability","page_number":285,"box":{"x":309,"y":132,"width":530,"height":12}},{"id":"f5e38118-ee6d-4fd7-8938-e0aebc0c6c34","block_type":"box","text":"during a time of transition, or on the basis of its business model (e.g., a non-operating company such","page_number":285,"box":{"x":116,"y":147,"width":754,"height":13}},{"id":"c76e68bb-b989-4308-8851-699034e94348","block_type":"box","text":"as closed-end funds).","page_number":285,"box":{"x":116,"y":163,"width":165,"height":12}},{"id":"721ca51d-7496-4b96-83a7-c6b13b5f18b0","block_type":"box","text":"Shareholders should have the opportunity to evaluate nominated directors individually rather than in","page_number":285,"box":{"x":116,"y":192,"width":746,"height":13}},{"id":"1cef274c-3275-4796-8b1f-4d1eb04cc9e2","block_type":"box","text":"bundled slates. We look to companies to provide sufficient information on each director standing for","page_number":285,"box":{"x":117,"y":208,"width":743,"height":12}},{"id":"269e7a66-906c-474c-bfb3-ed19409d5f82","block_type":"box","text":"election so that shareholders can assess their capabilities and suitability. We will generally not support","page_number":285,"box":{"x":116,"y":224,"width":765,"height":12}},{"id":"b70a0ae7-72f3-45d9-9646-01b9b3e8933f","block_type":"box","text":"the election of directors whose names and biographical details have not been disclosed sufficiently in","page_number":285,"box":{"x":116,"y":239,"width":755,"height":12}},{"id":"dbe11bf1-e82a-46f3-a1ad-a7330b37ca05","block_type":"box","text":"advance of the shareholder meeting.","page_number":285,"box":{"x":116,"y":254,"width":278,"height":13}},{"id":"1a08a62e-3023-47bc-8d0b-099acef20885","block_type":"box","text":"Each director’s appointment should be dependent on receiving a simple majority of the votes cast at","page_number":285,"box":{"x":117,"y":284,"width":746,"height":12}},{"id":"86fff3f8-b0ed-422f-b616-649dd0373409","block_type":"box","text":"the shareholder meeting. Where a company’s practices differ, we look to the board to provide a","page_number":285,"box":{"x":116,"y":299,"width":712,"height":13}},{"id":"dda7a3e9-3307-4c52-acae-d88e9688f95e","block_type":"box","text":"detailed explanation as to how its approach best serves investors’ interests.","page_number":285,"box":{"x":116,"y":315,"width":567,"height":12}},{"id":"eb1b3122-3dc8-4355-932b-8ce41a3db345","block_type":"box","text":"We may vote for shareholder or management proposals seeking to establish annual election of","page_number":285,"box":{"x":116,"y":344,"width":710,"height":12}},{"id":"6906fea0-6113-4973-aab8-18939bab6768","block_type":"box","text":"directors and/or a simple majority vote standard for director elections. We may vote against all the","page_number":285,"box":{"x":116,"y":360,"width":732,"height":12}},{"id":"28b36388-5c15-4834-83d4-e4dc439a9dba","block_type":"box","text":"directors standing for election as part of a single slate if we have concerns about the profile or","page_number":285,"box":{"x":116,"y":375,"width":701,"height":12}},{"id":"2a2a1881-0b08-430a-ab4d-adb85f718348","block_type":"box","text":"performance of an individual director.","page_number":285,"box":{"x":117,"y":391,"width":280,"height":12}},{"id":"38b2b484-bca2-4d1a-990c-c4f1d2e31f2a","block_type":"box","text":"Committees","page_number":285,"box":{"x":117,"y":420,"width":100,"height":10}},{"id":"c0dc3433-0c31-4cdb-968f-1bc24c872f4b","block_type":"box","text":"Many boards establish committees to focus on specific responsibilities of the board such as audit and","page_number":285,"box":{"x":117,"y":450,"width":757,"height":12}},{"id":"3646a349-8495-4e5c-9b47-e51174fd430a","block_type":"box","text":"risk, governance and human capital, and executive compensation, amongst other matters. We do not","page_number":285,"box":{"x":117,"y":465,"width":756,"height":12}},{"id":"ce40287c-4a2a-4c48-9cf5-bbefcb5d1581","block_type":"box","text":"prescribe to companies what committees they should establish, but we seek to understand the board’s","page_number":285,"box":{"x":117,"y":481,"width":765,"height":12}},{"id":"cdf9c2e4-41e4-49ac-9ac0-25a806f54413","block_type":"box","text":"rationale for the committee structure it determines is appropriate. We note that, in some markets,","page_number":285,"box":{"x":117,"y":496,"width":723,"height":12}},{"id":"24fe975e-919a-4506-8597-ba85a921aa89","block_type":"box","text":"regulation requires such committees. The responsibilities of each committee should be clear, and the","page_number":285,"box":{"x":117,"y":512,"width":754,"height":12}},{"id":"b7f92251-41f2-49b3-861f-6511f5aeed2c","block_type":"box","text":"board should ensure that all critical matters are assigned either to the full board or to one of the","page_number":285,"box":{"x":117,"y":527,"width":711,"height":12}},{"id":"676db734-4fb2-4bbb-bd73-68769c7718e1","block_type":"box","text":"committees. It is helpful to investor understanding when the board discloses the structure,","page_number":285,"box":{"x":116,"y":543,"width":672,"height":12}},{"id":"7a41f2ca-1912-42e8-abfc-2bae08bdb885","block_type":"box","text":"membership, proportion of independent directors, and responsibilities of each committee. The","page_number":285,"box":{"x":117,"y":558,"width":700,"height":12}},{"id":"16bd4649-c9ea-429f-95db-8ec1e5963219","block_type":"box","text":"responsibilities we typically see assigned to the three most common committees include:","page_number":285,"box":{"x":117,"y":574,"width":662,"height":12}},{"id":"b502b436-f307-4085-9563-69435ce9d7b1","block_type":"box","text":"• Audit and risk – oversight responsibilities for the integrity of financial reporting, risk management","page_number":285,"box":{"x":117,"y":596,"width":752,"height":12}},{"id":"b7b07417-7ca3-4214-88b1-106cc2361655","block_type":"box","text":"and compliance with legal and regulatory requirements; may also play an oversight role in relation","page_number":285,"box":{"x":150,"y":612,"width":731,"height":12}},{"id":"4af494db-6c61-4ff6-8661-b1142a1746d6","block_type":"box","text":"to the internal audit function and whistleblowing mechanisms.","page_number":285,"box":{"x":150,"y":627,"width":460,"height":12}},{"id":"47b6a69e-3d29-4aff-ad0a-cbb6738cf778","block_type":"box","text":"• Nominating, governance and human capital – oversight responsibilities for corporate governance","page_number":285,"box":{"x":117,"y":650,"width":756,"height":12}},{"id":"9bfc7729-ded9-45f1-b114-512fdffec10e","block_type":"box","text":"principles and practices of the company, including the periodic review of board performance;","page_number":285,"box":{"x":150,"y":665,"width":684,"height":12}},{"id":"4293c262-ca96-4c58-9da8-043da7fb2636","block_type":"box","text":"responsibility for succession planning for CEO and key board roles, as well as the director","page_number":285,"box":{"x":150,"y":681,"width":667,"height":12}},{"id":"73ffaa52-d901-4b1a-959c-67b1eae68cbd","block_type":"box","text":"appointment process; may also have oversight responsibilities for human capital management","page_number":285,"box":{"x":150,"y":696,"width":698,"height":12}},{"id":"790bf898-c698-40e5-9e67-cb9514efb58f","block_type":"box","text":"strategies, including corporate culture and purpose.","page_number":285,"box":{"x":150,"y":712,"width":381,"height":12}},{"id":"c649023f-488d-4f0d-9dbd-42b66756aab2","block_type":"box","text":"• Executive compensation – determines the compensation policies and programs for the CEO and","page_number":285,"box":{"x":117,"y":734,"width":749,"height":12}},{"id":"e47e4308-21db-4242-a85e-47ba6aceef9b","block_type":"box","text":"other executive officers, approves annual awards and payments under the policies; may also have","page_number":285,"box":{"x":150,"y":750,"width":730,"height":12}},{"id":"2551a3ac-07fc-4a74-a9cb-5c3c07b04fa7","block_type":"box","text":"oversight responsibilities for firm-wide compensation policies.","page_number":285,"box":{"x":150,"y":765,"width":453,"height":12}},{"id":"3acafe35-d9c6-4978-bb3c-8b87a5831cc0","block_type":"box","text":"We may vote against the election of the chair of the committee or other directors serving as committee","page_number":285,"box":{"x":116,"y":795,"width":760,"height":12}},{"id":"5d7ab2bb-751b-498e-af86-5a925f4e18c0","block_type":"box","text":"members to convey concerns about how a committee has undertaken its responsibilities. We may vote","page_number":285,"box":{"x":117,"y":810,"width":762,"height":12}},{"id":"cdf83464-ae1e-40ca-b37e-d36fadfe96aa","block_type":"box","text":"against the election of the most senior non-executive director if there is not a clearly disclosed","page_number":285,"box":{"x":116,"y":826,"width":702,"height":12}},{"id":"c7b685b4-032a-4be8-9d85-e30d3da25a82","block_type":"box","text":"approach to board committees.","page_number":285,"box":{"x":116,"y":841,"width":236,"height":12}},{"id":"c19963b8-5766-48bb-97b1-25afe900f926","block_type":"box","text":"8","page_number":285,"box":{"x":143,"y":867,"width":4,"height":4}},{"id":"c9e1a44f-b48a-4f19-8ff8-245a02a319a0","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":285,"box":{"x":170,"y":866,"width":673,"height":10}},{"id":"8bd2c661-fd0a-42ce-9617-22b9e5c1f29a","block_type":"box","text":"directors stands for election in any one year.","page_number":285,"box":{"x":170,"y":879,"width":262,"height":10}},{"id":"93108633-0942-4dc6-b5f5-a927333cb089","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":285,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"f2d4bb42-bd2b-4c4a-8947-4aa558efa2f7","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":285,"box":{"x":539,"y":909,"width":324,"height":12}},{"id":"e6359d03-b888-49f7-aaa3-efba97981d22","block_type":"box","text":"8","page_number":285,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"d0e82448-fbc7-4f28-b128-83d254a959f2","block_type":"box","text":"NM1026U-6004382-285/605","page_number":285,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"0f939823-e0bd-4545-b2a9-033c34c89350","block_type":"box","text":"Board and director evaluation","page_number":286,"box":{"x":116,"y":87,"width":243,"height":10}},{"id":"fc8ece74-a092-4690-92df-26d9fd163a20","block_type":"box","text":"We consider it best practice for companies to conduct an annual review of the performance of the","page_number":286,"box":{"x":116,"y":119,"width":729,"height":12}},{"id":"389af8ac-a6ce-4d3d-b599-64631f3c4bb9","block_type":"box","text":"board, the committees, the chair and individual directors. Periodically, this review could be undertaken","page_number":286,"box":{"x":117,"y":134,"width":762,"height":12}},{"id":"5b1299bc-1dd8-40d7-b25b-d8b97d317a78","block_type":"box","text":"by an independent third party able to bring objective perspectives to the board on governance and","page_number":286,"box":{"x":117,"y":150,"width":732,"height":12}},{"id":"f06d0662-e5ab-48d9-ade6-09a4df12a55c","block_type":"box","text":"performance. We encourage companies to disclose their approach to and the objectives of","page_number":286,"box":{"x":117,"y":165,"width":677,"height":12}},{"id":"982e7f48-ac4f-4104-96e7-ce47dd2855f7","block_type":"box","text":"evaluations, including any changes made to the board’s approach as a result.","page_number":286,"box":{"x":116,"y":181,"width":581,"height":12}},{"id":"25a36c9e-4439-47f5-971a-4e318d89b486","block_type":"box","text":"Access to independent advice","page_number":286,"box":{"x":116,"y":213,"width":246,"height":11}},{"id":"a428e802-9352-41ec-9d3f-8def79fca30a","block_type":"box","text":"To support the directors in effectively fulfilling their duties to the company and shareholders, they","page_number":286,"box":{"x":116,"y":244,"width":723,"height":12}},{"id":"3ee55b01-b0c3-45d4-9c4f-fa00f2a1de19","block_type":"box","text":"should have access to independent advice. In certain circumstances, it may be helpful to boards to","page_number":286,"box":{"x":116,"y":260,"width":738,"height":12}},{"id":"f2cf8846-966c-4895-bf99-a9a0e4a6580d","block_type":"box","text":"retain independent third parties to advise on critical matters. These might include new industry","page_number":286,"box":{"x":117,"y":275,"width":703,"height":12}},{"id":"99019202-b467-4458-a63e-dca049e03634","block_type":"box","text":"developments such as emergent and disruptive technology, operating events with material","page_number":286,"box":{"x":116,"y":291,"width":676,"height":12}},{"id":"2db17f43-6e48-4bd1-b641-0ec46622a989","block_type":"box","text":"consequences for the company’s reputation and/or performance, or significant transactions. Board","page_number":286,"box":{"x":116,"y":306,"width":735,"height":12}},{"id":"c3d3867d-546e-4997-a475-773b31bbab9b","block_type":"box","text":"committees may similarly retain third parties to advise them on specialist matters such as audit,","page_number":286,"box":{"x":116,"y":322,"width":713,"height":12}},{"id":"e24dc634-85e9-4cf5-90d1-04534a4f9629","block_type":"box","text":"compensation and succession planning.","page_number":286,"box":{"x":116,"y":337,"width":303,"height":12}},{"id":"83fb293b-dbc5-4e9b-a0a1-54cb3d2b41d5","block_type":"box","text":"EXECUTIVE COMPENSATION","page_number":286,"box":{"x":382,"y":369,"width":241,"height":9}},{"id":"a81306a2-e56c-47c8-b737-8aa88228b0b6","block_type":"box","text":"Boards play an important role in establishing compensation arrangements that enable the company to","page_number":286,"box":{"x":117,"y":401,"width":760,"height":12}},{"id":"10dfa151-1670-4c13-ae8e-80521c620420","block_type":"box","text":"recruit, retain and reward the caliber of executive management necessary to lead and operate the","page_number":286,"box":{"x":117,"y":416,"width":730,"height":12}},{"id":"114479b1-cfc1-4357-a250-848459965b2b","block_type":"box","text":"company to deliver superior financial returns over time. We focus on alignment between variable pay","page_number":286,"box":{"x":116,"y":432,"width":753,"height":12}},{"id":"29f6fd60-1d67-4b23-8227-d73f96e20721","block_type":"box","text":"and a company’s financial performance.","page_number":286,"box":{"x":116,"y":447,"width":302,"height":12}},{"id":"1563bd1a-4f96-4ff7-a1e1-83757bfb33b8","block_type":"box","text":"Generally, executive compensation arrangements have four components: base salary, annual bonus","page_number":286,"box":{"x":117,"y":479,"width":751,"height":12}},{"id":"fd3358bc-cfba-4594-bde2-a0b1c7ea0b67","block_type":"box","text":"that rewards performance against short-term metrics, incentives—most often share-based- that reward","page_number":286,"box":{"x":116,"y":494,"width":768,"height":12}},{"id":"78faf176-6225-4b61-8294-0b122bf38d6f","block_type":"box","text":"performance against long-term metrics, and pensions and benefits. In our observation, base salary,","page_number":286,"box":{"x":117,"y":510,"width":742,"height":12}},{"id":"b228a659-8204-4e51-a4fe-43f1d869cefc","block_type":"box","text":"pensions and benefits are largely set relative to market norms and benchmarks. The annual bonus and","page_number":286,"box":{"x":117,"y":525,"width":769,"height":12}},{"id":"f74baba0-1cea-4405-a275-313f9bed9540","block_type":"box","text":"share-based incentive, or variable pay plans, tend to be tailored to the company, its sector and long","page_number":286,"box":{"x":116,"y":541,"width":744,"height":12}},{"id":"e58a914e-acd8-49ef-9523-e652ec421fa5","block_type":"box","text":"term strategy, as well as the individuals the board is seeking to recruit and motivate.","page_number":286,"box":{"x":116,"y":557,"width":629,"height":11}},{"id":"abda240e-66bf-414a-b65a-16c7059da9b1","block_type":"box","text":"Recognizing the unique circumstances of each company, we determine whether to support a","page_number":286,"box":{"x":117,"y":588,"width":693,"height":12}},{"id":"736b818f-c9db-4120-ae56-bae9b4177d32","block_type":"box","text":"company’s approach to executive compensation on a case-by-case basis. We rely on companies","page_number":286,"box":{"x":116,"y":604,"width":726,"height":12}},{"id":"ebce85fc-c5be-4180-bef4-6668d8c9f4bb","block_type":"box","text":"providing sufficient quantitative and qualitative information in their disclosures to enable shareholders","page_number":286,"box":{"x":117,"y":619,"width":754,"height":12}},{"id":"847735c4-9aa9-4465-8551-2939546ba1f4","block_type":"box","text":"to understand the compensation arrangements and assess the alignment with investors’ interests.","page_number":286,"box":{"x":116,"y":635,"width":732,"height":12}},{"id":"edcb3bed-3fe9-4246-94c0-2ef99a2148e1","block_type":"box","text":"Features we look for in compensation arrangements include:","page_number":286,"box":{"x":117,"y":650,"width":454,"height":12}},{"id":"9c0040c7-df20-4620-b357-baa3a1e50e06","block_type":"box","text":"• Fixed pay components, including base salary, benefits and prerequisites that are appropriate in","page_number":286,"box":{"x":117,"y":682,"width":739,"height":12}},{"id":"39247a58-9b68-4597-b2eb-452292bf254e","block_type":"box","text":"the context of the company’s size, sector and market.","page_number":286,"box":{"x":150,"y":697,"width":396,"height":12}},{"id":"accfffe8-64d2-468e-9c12-2a63b907ca32","block_type":"box","text":"• Variable pay subject to performance metrics that are closely linked to the company’s short- and","page_number":286,"box":{"x":117,"y":721,"width":739,"height":12}},{"id":"68100348-ccdf-464c-828e-affaa9ccced1","block_type":"box","text":"long-term strategic objectives.","page_number":286,"box":{"x":150,"y":737,"width":222,"height":12}},{"id":"6d17cbca-5283-4d21-a5b7-81181bc6221f","block_type":"box","text":"• Long-term incentives that motivate sustained performance across a multi-year period.","page_number":286,"box":{"x":117,"y":760,"width":667,"height":12}},{"id":"5e16fe1f-5562-4b53-a58c-224185ebb3a5","block_type":"box","text":"• A balance between fixed and variable pay, short- and long-term incentives, and specific","page_number":286,"box":{"x":117,"y":784,"width":682,"height":12}},{"id":"11a3354e-6396-4df8-adf7-20fc984aaca5","block_type":"box","text":"instruments (cash and equity awards) that promotes pay program durability and seldom","page_number":286,"box":{"x":150,"y":799,"width":649,"height":12}},{"id":"24122d91-8837-4996-864f-22be6599e5a6","block_type":"box","text":"necessitates one-off, discretionary payments.","page_number":286,"box":{"x":150,"y":815,"width":336,"height":12}},{"id":"0131460b-ce47-48d8-96da-8508aae4cdda","block_type":"box","text":"• Pay outcomes that are consistent with the returns to investors over the relevant time period.","page_number":286,"box":{"x":117,"y":838,"width":720,"height":12}},{"id":"d456fa5a-af3a-436d-b593-365723774067","block_type":"box","text":"• Board discretion, if allowed within the variable pay arrangements, to be used sparingly,","page_number":286,"box":{"x":117,"y":862,"width":683,"height":12}},{"id":"48bdfcea-e214-4eea-adf3-fd6a481ee0b8","block_type":"box","text":"responsibly and transparently.","page_number":286,"box":{"x":150,"y":877,"width":228,"height":12}},{"id":"7a904fe8-2c33-42ee-9d62-da562b1d03a3","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":286,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"1335859d-863c-41cf-94d9-5cf0cd1fa1f9","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":286,"box":{"x":539,"y":909,"width":324,"height":12}},{"id":"45212b8d-b558-48e5-a6a5-5a0a20fa6ab0","block_type":"box","text":"9","page_number":286,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"e93e679d-21ea-462c-9762-0a0cf93c4cdc","block_type":"box","text":"NM1026U-6004382-286/605","page_number":286,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"0cdc8222-5067-4625-9eba-c7acd746679a","block_type":"box","text":"• A requirement, that participants in long-term share-based incentive plans build a meaningful","page_number":287,"box":{"x":117,"y":87,"width":720,"height":12}},{"id":"502d63cb-83a5-4a86-9b13-89c5571bdfd3","block_type":"box","text":"shareholding in the company within a defined time period, as determined by the board or relevant","page_number":287,"box":{"x":150,"y":102,"width":727,"height":13}},{"id":"fdd759cb-fe76-492e-91f8-9dafa75f627d","block_type":"box","text":"board committee.","page_number":287,"box":{"x":150,"y":118,"width":134,"height":10}},{"id":"919fd60c-863e-4b2a-86d4-3c7826dbeca0","block_type":"box","text":"• Change of control provisions that appropriately balance the interests of executives and","page_number":287,"box":{"x":117,"y":142,"width":681,"height":12}},{"id":"cc5d76c3-ce0f-4596-af9a-152eeec23db8","block_type":"box","text":"shareholders.","page_number":287,"box":{"x":150,"y":157,"width":106,"height":10}},{"id":"4b9261d1-4ba9-4810-b181-e5e27ee3b00e","block_type":"box","text":"• Clawback or malus provisions that allow the company to recoup or hold back variable","page_number":287,"box":{"x":117,"y":181,"width":671,"height":12}},{"id":"e289159d-06d5-4d88-96ea-bbe3cb0ae98b","block_type":"box","text":"compensation from individuals whose awards were based on fraudulent activities, misstated","page_number":287,"box":{"x":150,"y":196,"width":688,"height":12}},{"id":"32a8e0a0-d47a-4ce6-a7dc-fb80d830fa48","block_type":"box","text":"financial reports, or executive misconduct.","page_number":287,"box":{"x":149,"y":212,"width":318,"height":12}},{"id":"987fce18-c764-4c7b-b2b4-e9b8babffac2","block_type":"box","text":"• Severance arrangements that protect the company’s interests but do not cost more than is","page_number":287,"box":{"x":117,"y":235,"width":709,"height":12}},{"id":"f52a4459-398d-4e73-a10d-37b8fc076cdc","block_type":"box","text":"contractual.","page_number":287,"box":{"x":150,"y":251,"width":91,"height":9}},{"id":"5ac8fd4c-3c58-49d0-9cd9-a53f00cb96f1","block_type":"box","text":"We may vote against proposals to introduce new share-based incentives, approve existing policies or","page_number":287,"box":{"x":116,"y":282,"width":757,"height":12}},{"id":"5ab5b46c-3d0c-498b-b968-52c2627c5629","block_type":"box","text":"plans, or approve the compensation report where we do not see alignment between executive","page_number":287,"box":{"x":117,"y":298,"width":701,"height":12}},{"id":"12f20c28-8d01-4db8-adcf-556784a72bef","block_type":"box","text":"compensation arrangements and our clients’ financial interests. When there is not an alternative, or","page_number":287,"box":{"x":116,"y":313,"width":742,"height":12}},{"id":"21fa56d7-7992-45da-a914-26f21db11080","block_type":"box","text":"where there have been multi-year issues with compensation misaligned with performance, we may","page_number":287,"box":{"x":116,"y":329,"width":738,"height":12}},{"id":"d3f0b59b-d78c-4cf6-8ba4-52b42f7d33ea","block_type":"box","text":"vote against the election of the chair of the responsible committee, or the most senior independent","page_number":287,"box":{"x":116,"y":344,"width":735,"height":12}},{"id":"25120b8f-ff66-4f70-aa6c-fccfa5891073","block_type":"box","text":"director.","page_number":287,"box":{"x":116,"y":360,"width":65,"height":9}},{"id":"690e9e15-7ba5-453f-b717-9e22f1227dca","block_type":"box","text":"NON-EXECUTIVE DIRECTOR COMPENSATION","page_number":287,"box":{"x":314,"y":399,"width":377,"height":10}},{"id":"427bf04d-c8d2-41b0-a08a-f0bf877b08b0","block_type":"box","text":"Companies generally pay non-executive directors an annual retainer or fee in cash, shares or a","page_number":287,"box":{"x":117,"y":431,"width":712,"height":12}},{"id":"2f878939-b11d-4258-a5fb-89a4592f8a02","block_type":"box","text":"combination of the two. Some companies also pay additional fees for service on board committees or","page_number":287,"box":{"x":116,"y":446,"width":757,"height":13}},{"id":"f9ee73c6-1283-4de9-8277-0a2670f5197b","block_type":"box","text":"in board leadership roles. We do not support non-executive directors participating in performance","page_number":287,"box":{"x":117,"y":462,"width":726,"height":12}},{"id":"0e6fff35-cd17-4227-bfc8-564ac692f04a","block_type":"box","text":"based incentive plans as doing so may create a conflict of interest and undermine their independence","page_number":287,"box":{"x":117,"y":477,"width":759,"height":13}},{"id":"e87712d7-8c75-480e-96fe-3e59cb70af10","block_type":"box","text":"from management, whom they oversee.","page_number":287,"box":{"x":116,"y":493,"width":301,"height":12}},{"id":"4879a9bc-948f-420b-92db-3246854cf81d","block_type":"box","text":"CAPITAL STRUCTURE","page_number":287,"box":{"x":410,"y":533,"width":185,"height":9}},{"id":"4c1681f8-7c09-4039-b575-a34e805145e4","block_type":"box","text":"Boards are responsible for ensuring senior executive leadership has established a capital strategy that","page_number":287,"box":{"x":117,"y":564,"width":765,"height":12}},{"id":"55ebb5e4-d563-49b6-920b-2a471d862819","block_type":"box","text":"achieves appropriate capital allocation in support of long-term financial resilience.","page_number":287,"box":{"x":116,"y":580,"width":610,"height":12}},{"id":"872054f1-cd7c-4cd7-9391-830c9be075f4","block_type":"box","text":"Where company practices diverge from those set out below, we look for companies to disclose why","page_number":287,"box":{"x":116,"y":611,"width":743,"height":12}},{"id":"716b0607-b118-4bf2-9b8b-07b1f10e2cf8","block_type":"box","text":"they view these practices to be aligned with shareholders’ interests. We may vote against management","page_number":287,"box":{"x":116,"y":627,"width":772,"height":12}},{"id":"7858f32c-0341-42d8-827a-8fb36a7c3f4d","block_type":"box","text":"proposals seeking capital-related authorities, or the election of the most senior independent director, if","page_number":287,"box":{"x":117,"y":642,"width":761,"height":12}},{"id":"3c282cdf-24b5-4ca0-90fd-cde008d22dc0","block_type":"box","text":"we have concerns about a company’s approach. We may also support a shareholder proposal seeking","page_number":287,"box":{"x":116,"y":658,"width":768,"height":12}},{"id":"e2db7ce1-2576-4ef7-ba43-817de7c5ff6c","block_type":"box","text":"conversion of shares with differentiated voting rights to a one-share, one-vote standard.","page_number":287,"box":{"x":116,"y":673,"width":649,"height":12}},{"id":"e579ffc4-9392-42c1-9cfc-c06e362877e2","block_type":"box","text":"Share","page_number":287,"box":{"x":116,"y":705,"width":46,"height":9}},{"id":"2fd1cc19-a906-4d2b-bbf6-cb2da89d51b8","block_type":"box","text":"issuance","page_number":287,"box":{"x":168,"y":705,"width":71,"height":9}},{"id":"498a280a-c023-49ea-8dcd-4aec62604d54","block_type":"box","text":"We assess requests for share issuance for particular transactions on a case-by-case basis. We will","page_number":287,"box":{"x":116,"y":736,"width":735,"height":13}},{"id":"c5b06e76-6c94-4dd2-9274-f61bdb0cc9df","block_type":"box","text":"generally support authorities to issue shares when subject to pre-emptive rights, and up to 20% absent","page_number":287,"box":{"x":116,"y":752,"width":763,"height":12}},{"id":"ed477826-8c17-44af-a3d3-846a9c88bf3f","block_type":"box","text":"pre-emptive rights. We consider it good practice for companies to seek regular approval of these","page_number":287,"box":{"x":117,"y":767,"width":715,"height":13}},{"id":"8079e0e0-e932-4e33-b05f-fcd9dfb0750f","block_type":"box","text":"authorities to allow shareholders to take into consideration how prior authorities were used, as well as","page_number":287,"box":{"x":116,"y":783,"width":754,"height":12}},{"id":"19fd72dd-9533-4802-a085-034ab326b571","block_type":"box","text":"the current circumstances of the company and the market environment.","page_number":287,"box":{"x":116,"y":798,"width":530,"height":13}},{"id":"e4b5e403-c39f-4fa6-975f-2b6e90d385dc","block_type":"box","text":"Share buybacks","page_number":287,"box":{"x":116,"y":830,"width":133,"height":12}},{"id":"97a945a6-ca68-440c-b2e0-817d16814ba6","block_type":"box","text":"We assess share buyback proposals in the context of the company’s disclosed capital management","page_number":287,"box":{"x":116,"y":862,"width":746,"height":12}},{"id":"f3580ee6-351d-4fc9-ba80-a84003ae90b0","block_type":"box","text":"strategy and management’s determination of the appropriate balance between investment that","page_number":287,"box":{"x":116,"y":877,"width":706,"height":12}},{"id":"2678e6f0-8540-44f0-a5e0-0bae0ea9459f","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":287,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"2109a0d5-1bb3-452d-be11-e327da914771","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":287,"box":{"x":530,"y":909,"width":324,"height":12}},{"id":"a46ae955-f809-401c-8de8-87bf43c2ffcd","block_type":"box","text":"10","page_number":287,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"fe0b8c64-1e9a-4e77-a5bc-9fccadb9a61f","block_type":"box","text":"NM1026U-6004382-287/605","page_number":287,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"358fe150-a80f-4029-9056-ca111404aad0","block_type":"box","text":"supports the long-term growth of the company and returning cash to investors. We also take into","page_number":288,"box":{"x":116,"y":87,"width":721,"height":12}},{"id":"7e8956b6-4f9f-46dc-b8d0-132db119a3e4","block_type":"box","text":"consideration the effect of a buyback program on the company’s balance sheet and executive","page_number":288,"box":{"x":116,"y":102,"width":701,"height":13}},{"id":"a80ddc86-bf11-45d9-a4a6-86218accf930","block_type":"box","text":"compensation arrangements and the price at which shares are repurchased relative to market price.","page_number":288,"box":{"x":116,"y":118,"width":748,"height":12}},{"id":"f244d438-c5a5-4360-bca7-bc4c22c9ccb8","block_type":"box","text":"We consider it good practice for companies to seek regular approval of these authorities to allow","page_number":288,"box":{"x":116,"y":134,"width":721,"height":12}},{"id":"5d49f32d-32e1-4dd2-9604-86332c0c3f99","block_type":"box","text":"shareholders to take into consideration how prior authorities were used, as well as the current","page_number":288,"box":{"x":116,"y":149,"width":700,"height":12}},{"id":"98a93fc8-3702-4709-956f-d0c202208fb2","block_type":"box","text":"circumstances of the company and the market environment.","page_number":288,"box":{"x":116,"y":165,"width":451,"height":12}},{"id":"c6d0020e-ad95-48bd-bc1e-5dd710efd329","block_type":"box","text":"Dividends","page_number":288,"box":{"x":117,"y":193,"width":84,"height":10}},{"id":"774424dc-7549-4a30-95ee-fe160f8dd5cf","block_type":"box","text":"We generally defer to management and the board on dividend policy but may engage to seek further","page_number":288,"box":{"x":116,"y":222,"width":752,"height":12}},{"id":"f655b450-151e-4318-9a4f-433f87c24328","block_type":"box","text":"clarification where a proposed dividend appears out of line with the company’s financial position.","page_number":288,"box":{"x":116,"y":238,"width":720,"height":12}},{"id":"03b71d76-4ecb-48a4-9223-95ea49aa8794","block_type":"box","text":"Differentiated voting rights","page_number":288,"box":{"x":117,"y":266,"width":219,"height":12}},{"id":"10797213-db69-4c36-a518-30cc9197f35e","block_type":"box","text":"We prefer companies to adopt a one-share, one-vote structure for share classes with the same","page_number":288,"box":{"x":116,"y":295,"width":710,"height":12}},{"id":"33be6ba5-6b28-472f-b154-4c5dad8d29ce","block_type":"box","text":"economic exposure. Certain companies, particularly those new to public markets, could make the case","page_number":288,"box":{"x":116,"y":311,"width":768,"height":12}},{"id":"c9517814-afb8-4d11-aa43-c30cdfb395bb","block_type":"box","text":"to adopt a differentiated voting rights structure, or dual class stock. In those situations, we encourage","page_number":288,"box":{"x":116,"y":326,"width":755,"height":12}},{"id":"fe45afc0-4248-4abe-a453-ef1aae249cc9","block_type":"box","text":"companies to evaluate and seek approval for their capital structure on a periodic basis.","page_number":288,"box":{"x":116,"y":342,"width":650,"height":11}},{"id":"5ebfcaf3-0024-42a0-8730-a608ef2bb766","block_type":"box","text":"TRANSACTIONS AND SPECIAL SITUATIONS","page_number":288,"box":{"x":320,"y":377,"width":364,"height":9}},{"id":"492e522d-9220-4a43-a7a4-bd253338f39d","block_type":"box","text":"We monitor developments in transactions and special situations closely and undertake our own","page_number":288,"box":{"x":116,"y":406,"width":712,"height":12}},{"id":"08cd2c7c-41f2-4db9-95dc-c9dc61e047a5","block_type":"box","text":"detailed analyses of proposals.","page_number":288,"box":{"x":116,"y":421,"width":235,"height":12}},{"id":"4a0dae93-1383-4488-b84e-1053e56b3a51","block_type":"box","text":"Mergers and acquisitions","page_number":288,"box":{"x":117,"y":457,"width":206,"height":12}},{"id":"d5fd8516-ee24-4a5f-a010-0b9c780c5706","block_type":"box","text":"We evaluate proposed mergers or acquisitions by assessing the financial outcome for our clients as","page_number":288,"box":{"x":116,"y":485,"width":745,"height":12}},{"id":"4a7f17b2-439c-400d-b490-e97c46436595","block_type":"box","text":"minority shareholders. Management should provide an assessment of the proposed transaction’s","page_number":288,"box":{"x":117,"y":501,"width":725,"height":12}},{"id":"520713f4-a9de-4658-9561-22469470c876","block_type":"box","text":"strategic and financial rationale, along with its execution and operational risks. We review each","page_number":288,"box":{"x":116,"y":516,"width":709,"height":12}},{"id":"e02bbc7c-32b7-487e-b9d9-bd609d0b41cb","block_type":"box","text":"transaction independently based on these factors and the degree to which the transaction enhances","page_number":288,"box":{"x":116,"y":532,"width":748,"height":12}},{"id":"fed6a1d6-8054-4e46-affc-7cd537d9bbdd","block_type":"box","text":"shareholder value. The board might consider establishing an ad hoc transaction committee to","page_number":288,"box":{"x":116,"y":547,"width":699,"height":12}},{"id":"c916ddf0-f14e-4961-bd65-238ab69eb3dc","block_type":"box","text":"undertake an independent assessment of a significant merger or acquisition, in advance of making its","page_number":288,"box":{"x":117,"y":563,"width":757,"height":12}},{"id":"5eaffbc1-afb0-4c86-807c-b429fcc66238","block_type":"box","text":"recommendation to shareholders.","page_number":288,"box":{"x":117,"y":578,"width":254,"height":10}},{"id":"a8177cd4-2bbd-47a3-8cc7-e4b6c6c628ed","block_type":"box","text":"We will vote against transactions that, in our assessment, do not advance our clients’ financial","page_number":288,"box":{"x":116,"y":607,"width":703,"height":12}},{"id":"0071bdf7-18bb-4284-b82d-1f81641ada90","block_type":"box","text":"interests.","page_number":288,"box":{"x":117,"y":623,"width":72,"height":9}},{"id":"cac7a7c8-4502-45cf-af90-ad4d2d4eeaaa","block_type":"box","text":"Anti-takeover defenses","page_number":288,"box":{"x":116,"y":651,"width":190,"height":10}},{"id":"e1518b53-ea87-45a8-9a2e-6c1af2794065","block_type":"box","text":"In principle, we do not support companies using anti-takeover defenses, also known as poison pills or","page_number":288,"box":{"x":117,"y":680,"width":753,"height":12}},{"id":"f427e316-af89-4a34-bb79-441878782a3b","block_type":"box","text":"shareholder rights plans, as they can entrench management and boards which have not delivered","page_number":288,"box":{"x":116,"y":696,"width":726,"height":12}},{"id":"7d0bbcd0-75d3-4baa-a944-a86b516a0269","block_type":"box","text":"long-term shareholder value. By exception, a poison pill may be supported if its purpose is to delay a","page_number":288,"box":{"x":117,"y":711,"width":746,"height":12}},{"id":"c42e2e1a-f226-4d9f-97ec-5517e9bd54c2","block_type":"box","text":"takeover that is considered sub-optimal and enable management to seek an improved offer. Similarly,","page_number":288,"box":{"x":116,"y":727,"width":754,"height":12}},{"id":"f1cc6f11-6344-48ac-a4a5-0a9039ed4f08","block_type":"box","text":"management could make the case to use a poison pill to block a shareholder activism campaign that","page_number":288,"box":{"x":117,"y":742,"width":746,"height":12}},{"id":"9f1fd698-31ff-4bb5-890e-42b3c04dde64","block_type":"box","text":"may be counter to the interests of other investors. Defense mechanisms introduced in these","page_number":288,"box":{"x":117,"y":758,"width":681,"height":12}},{"id":"fc3451c4-cb89-4272-8fe0-71c9e2790fa7","block_type":"box","text":"circumstances should be limited in term and threshold, and also be closely monitored by the","page_number":288,"box":{"x":116,"y":773,"width":683,"height":12}},{"id":"3884be33-c422-4379-ad03-a84f1b2d92eb","block_type":"box","text":"independent members of the board. We consider it good practice for companies to put to a shareholder","page_number":288,"box":{"x":117,"y":789,"width":766,"height":12}},{"id":"033776e6-65b3-42d6-966c-9be2a8accf1e","block_type":"box","text":"vote any mechanisms expected to be in place for more than 12 months.","page_number":288,"box":{"x":116,"y":804,"width":532,"height":12}},{"id":"5d548d1d-723d-4e81-9b92-4d5b3e3d61a4","block_type":"box","text":"Shareholder activism","page_number":288,"box":{"x":116,"y":833,"width":175,"height":9}},{"id":"8b38397a-c4db-4108-900f-318c58fc0cdb","block_type":"box","text":"When companies are the focus of an activism campaign, we may communicate with the activist to","page_number":288,"box":{"x":116,"y":862,"width":732,"height":12}},{"id":"9d3cbc3e-bbaa-4b5c-b5cf-740967c8b110","block_type":"box","text":"understand their analysis and objectives, once they have publicly disclosed their campaign. We may","page_number":288,"box":{"x":117,"y":877,"width":748,"height":12}},{"id":"fbf67dae-e0fa-4b92-b5da-da10b5bc2b1e","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":288,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"9feb9181-5435-40f5-92dc-3474a9644dc3","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":288,"box":{"x":530,"y":909,"width":324,"height":12}},{"id":"49970e05-9879-4010-815a-e60dfe0f6bdd","block_type":"box","text":"11","page_number":288,"box":{"x":866,"y":909,"width":15,"height":9}},{"id":"b97f9d55-f53e-44e2-8984-75d35c20841c","block_type":"box","text":"NM1026U-6004382-288/605","page_number":288,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"06ef72e7-7b86-4064-92e2-f1f5111c5a7d","block_type":"box","text":"also engage with company management and possibly board members, especially those the activist","page_number":289,"box":{"x":116,"y":87,"width":741,"height":12}},{"id":"a4b5f837-127e-493a-97f1-3ae575ed09f2","block_type":"box","text":"may be seeking to replace. In our assessment, we evaluate various factors, including the concerns","page_number":289,"box":{"x":117,"y":102,"width":737,"height":13}},{"id":"db409c8c-2e52-4806-b15f-2cbbcb2754b6","block_type":"box","text":"raised by the activist and the case for change; the quality of both the activist’s and management’s","page_number":289,"box":{"x":117,"y":118,"width":728,"height":12}},{"id":"db5fc2c7-54c2-4e6e-a553-942b038c0029","block_type":"box","text":"plans; and the qualifications of each party’s candidates. We evaluate each contested situation by","page_number":289,"box":{"x":117,"y":134,"width":723,"height":12}},{"id":"57b543cc-9f0c-4136-8bed-95cddaa2ae46","block_type":"box","text":"assessing the potential financial outcome for our clients as minority shareholders.","page_number":289,"box":{"x":116,"y":149,"width":610,"height":12}},{"id":"ee0c5edc-b4e5-470e-b55e-6a809a703577","block_type":"box","text":"We may support board candidates nominated by a shareholder activist if BAIS, in its independent","page_number":289,"box":{"x":116,"y":181,"width":728,"height":12}},{"id":"d0e59471-51b4-4e89-baf3-0bd627d3dd67","block_type":"box","text":"judgment, or the relevant portfolio manager has determined that there is a case for change to enhance","page_number":289,"box":{"x":115,"y":196,"width":767,"height":12}},{"id":"59bcd600-2e36-4595-b4ad-ff9305eb4716","block_type":"box","text":"shareholder value, or if the incumbent board members do not demonstrate the relevant skills and","page_number":289,"box":{"x":116,"y":212,"width":725,"height":11}},{"id":"8002a943-0983-413b-84c9-422984c3a2a0","block_type":"box","text":"expertise or have a poor track record of protecting shareholders’ interests.","page_number":289,"box":{"x":116,"y":227,"width":556,"height":12}},{"id":"0dc4eee1-7aff-4af1-965c-dace2ff474ff","block_type":"box","text":"Significant shareholders and related party transactions","page_number":289,"box":{"x":116,"y":259,"width":446,"height":12}},{"id":"4fb1571e-e6fe-4ce0-9e7d-b4d82c7a2cdf","block_type":"box","text":"Boards of companies with affiliated shareholders or directors should give equitable consideration to the","page_number":289,"box":{"x":117,"y":291,"width":768,"height":12}},{"id":"f00bbf70-959d-4001-8953-b89cfff6d9c4","block_type":"box","text":"interests of all shareholders when evaluating related party transactions.","page_number":289,"box":{"x":117,"y":306,"width":534,"height":12}},{"id":"63c3c77a-ce54-4120-9115-eb73d97614b0","block_type":"box","text":"We consider it good practice for transactions with related parties, such as significant shareholders or","page_number":289,"box":{"x":116,"y":338,"width":751,"height":12}},{"id":"6d4d0668-7d6c-406d-98f0-c9f472b0238c","block_type":"box","text":"companies affiliated with the public company, to be disclosed in detail and conducted on terms similar","page_number":289,"box":{"x":116,"y":354,"width":760,"height":12}},{"id":"d562e5dd-39d0-4ae3-812e-caf527bced4f","block_type":"box","text":"to what would objectively have been agreed with a non-related party. In our view, such transactions","page_number":289,"box":{"x":116,"y":369,"width":743,"height":12}},{"id":"458d77fc-3edf-4383-9a30-577b478d54b0","block_type":"box","text":"should be reviewed and approved by the independent members of the board, and if voted on, only","page_number":289,"box":{"x":116,"y":385,"width":734,"height":12}},{"id":"d319bb2c-4e32-4e83-bcde-1c3381bf1347","block_type":"box","text":"disinterested shareholders should vote.","page_number":289,"box":{"x":116,"y":400,"width":297,"height":10}},{"id":"130fdbf9-ea28-4021-8d2e-ad652008b4d3","block_type":"box","text":"CORPORATE REPORTING, RISK MANAGEMENT AND AUDIT","page_number":289,"box":{"x":257,"y":440,"width":490,"height":12}},{"id":"fce985a0-6868-4144-815b-6c6c4536498f","block_type":"box","text":"Investors depend on corporate reporting, both regulatory and voluntary, to understand a company’s","page_number":289,"box":{"x":117,"y":472,"width":742,"height":12}},{"id":"6eb2a3ea-467a-4cb7-b43f-cf68c8946c6a","block_type":"box","text":"strategy, its implementation and financial performance, as well as to assess the quality of management","page_number":289,"box":{"x":116,"y":487,"width":770,"height":12}},{"id":"474c7316-43f0-4d27-b7a0-c7ebc1912fdd","block_type":"box","text":"and operations and potential for the company to create shareholder value over time. We consider it","page_number":289,"box":{"x":116,"y":503,"width":741,"height":12}},{"id":"b80d2825-4d14-4a41-8be7-f63fd89a0f6d","block_type":"box","text":"good practice for the board to oversee corporate reporting and the policies and procedures","page_number":289,"box":{"x":116,"y":518,"width":679,"height":12}},{"id":"23f9db75-fc1b-4ced-876a-ff896eb216ed","block_type":"box","text":"underpinning the internal audit function and external audit.","page_number":289,"box":{"x":117,"y":534,"width":436,"height":12}},{"id":"bcaf4c99-7041-4ec9-9aed-15dec24cb3af","block_type":"box","text":"A company’s financial reporting should provide decision-useful information for investors, and other","page_number":289,"box":{"x":116,"y":566,"width":734,"height":12}},{"id":"93eefe2c-0b31-4a96-b51a-a2a4c014617d","block_type":"box","text":"stakeholders, on its financial performance and position. It should provide an accurate and balanced","page_number":289,"box":{"x":116,"y":581,"width":742,"height":12}},{"id":"0ac10426-161f-4471-972f-aba16652d3ae","block_type":"box","text":"assessment of the risks and opportunities the company faces in realizing its long-term strategy.","page_number":289,"box":{"x":116,"y":597,"width":712,"height":12}},{"id":"f739e80d-1150-4f84-bbb0-e2b75fe21018","block_type":"box","text":"Accordingly, the assumptions made by management and reviewed by the auditor in preparing the","page_number":289,"box":{"x":116,"y":612,"width":729,"height":12}},{"id":"9ee84108-7744-40a9-861c-3917cbc7c710","block_type":"box","text":"financial statements should be reasonable and justified. Financial statements should be prepared in","page_number":289,"box":{"x":116,"y":628,"width":744,"height":12}},{"id":"a3d30a34-a950-446e-8079-99090dd3c087","block_type":"box","text":"accordance with globally developed reporting standards and any divergence from generally accepted","page_number":289,"box":{"x":116,"y":643,"width":755,"height":12}},{"id":"e8ac4a31-79bd-45eb-8a35-b62d2fd395e3","block_type":"box","text":"accounting principles should be explained in detail and justified. Accounting restatements should be","page_number":289,"box":{"x":116,"y":659,"width":745,"height":12}},{"id":"a9201f77-e562-43ac-b39b-3feee01629bc","block_type":"box","text":"explained in detail and any remedial actions, and the implications of these, disclosed.","page_number":289,"box":{"x":116,"y":674,"width":631,"height":12}},{"id":"e440357b-00de-4388-806d-72ddfb76fabf","block_type":"box","text":"In this context, audit committees play a vital role in a company’s financial reporting system by providing","page_number":289,"box":{"x":117,"y":706,"width":763,"height":12}},{"id":"310a1c4e-d7ce-4d51-a9c6-537e4270f3f4","block_type":"box","text":"independent oversight of the accounts, material financial and, where appropriate to the jurisdiction,","page_number":289,"box":{"x":117,"y":721,"width":731,"height":13}},{"id":"3946b89b-33b7-4adb-aba2-d23b91a97a83","block_type":"box","text":"non-financial information, internal control frameworks and Enterprise Risk Management systems. In","page_number":289,"box":{"x":117,"y":737,"width":737,"height":12}},{"id":"2227fa39-fa24-4765-9950-6202832985e0","block_type":"box","text":"our view, effective audit committee oversight strengthens the quality and reliability of a company’s","page_number":289,"box":{"x":116,"y":752,"width":725,"height":13}},{"id":"4a02560f-ddb6-4d52-b7c2-9e1bc3adbc13","block_type":"box","text":"financial statements and provides an important level of reassurance to shareholders. Audit committees","page_number":289,"box":{"x":116,"y":768,"width":762,"height":12}},{"id":"85bc2a91-1f4a-4ee5-80f1-817f9de7f71c","block_type":"box","text":"should have a procedure in place for assessing the independence of the auditor and the quality of the","page_number":289,"box":{"x":116,"y":784,"width":753,"height":12}},{"id":"c32c40d9-9945-421d-94e6-2d848672a805","block_type":"box","text":"external audit process annually.","page_number":289,"box":{"x":116,"y":799,"width":235,"height":12}},{"id":"5594b60f-3ad3-40aa-b2eb-fe089fb1d816","block_type":"box","text":"Similarly, we encourage companies to disclose material sustainability-related factors that are integral to","page_number":289,"box":{"x":116,"y":831,"width":771,"height":12}},{"id":"f6847ff3-c7cb-4750-90d1-46889b351ca8","block_type":"box","text":"how a company manages risks or generates revenue. BAIS finds it helpful to our understanding when","page_number":289,"box":{"x":117,"y":846,"width":758,"height":12}},{"id":"ea7e2ee1-21be-45a5-8c49-55e8f1a899f6","block_type":"box","text":"companies provide robust, standardized disclosures on their material sustainability-related risks and","page_number":289,"box":{"x":116,"y":862,"width":747,"height":12}},{"id":"00f6196a-209a-4e1a-9f4e-8e5483b37a23","block_type":"box","text":"opportunities. The International Sustainability Standards Board (ISSB) is one entity working to meet","page_number":289,"box":{"x":116,"y":877,"width":743,"height":12}},{"id":"eee3a5ca-550d-452a-8a62-d31bf4c8d4b2","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":289,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"912b180d-8468-4710-b345-81bfce3a6d19","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":289,"box":{"x":530,"y":909,"width":324,"height":12}},{"id":"6f58837a-d541-4bbd-a1bc-8ee1ef0e945a","block_type":"box","text":"12","page_number":289,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"f55532e7-9acc-4553-8592-8b333ed9374c","block_type":"box","text":"NM1026U-6004382-289/605","page_number":289,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3ab4d966-b955-4c70-b9cc-f15e3d7aafbc","block_type":"box","text":"these objectives through its reporting standards, which may be helpful to companies in preparing such","page_number":290,"box":{"x":116,"y":87,"width":763,"height":12}},{"id":"8f3d232e-c179-4cff-a245-71a15b2062ff","block_type":"box","text":"reports.","page_number":290,"box":{"x":117,"y":103,"width":54,"height":11}},{"id":"57cd9c26-449a-43d4-9068-be1b60f05b7f","block_type":"box","text":"9","page_number":290,"box":{"x":173,"y":103,"width":5,"height":6}},{"id":"441af0e1-a0bb-4f2c-899f-62a6e89f0a3b","block_type":"box","text":"However, we do not mandate any specific disclosure framework, and note that companies in","page_number":290,"box":{"x":179,"y":102,"width":696,"height":13}},{"id":"8e6c4756-ba95-43c1-92fa-dc7babd8b2b2","block_type":"box","text":"certain jurisdictions are subject to mandatory reporting requirements under standards specified by","page_number":290,"box":{"x":116,"y":118,"width":731,"height":12}},{"id":"32b111d3-4d21-46dc-9326-8b2556ef46cb","block_type":"box","text":"policy makers.","page_number":290,"box":{"x":117,"y":134,"width":105,"height":12}},{"id":"e424b51e-9dfe-415c-81a3-a4aafc0df110","block_type":"box","text":"10","page_number":290,"box":{"x":224,"y":134,"width":11,"height":6}},{"id":"b7b15462-868b-4063-9139-d5d5f85f2bf8","block_type":"box","text":"Companies should establish robust risk management and internal control processes appropriate to the","page_number":290,"box":{"x":117,"y":161,"width":765,"height":12}},{"id":"3f1479fe-898c-4ccf-b6a1-2d3e824dc60a","block_type":"box","text":"company’s business, risk tolerance, and regulatory environment. A credible whistleblowing system for","page_number":290,"box":{"x":116,"y":176,"width":759,"height":12}},{"id":"baa849a0-af75-4d87-83cc-80ea20f74473","block_type":"box","text":"employees, and potentially other stakeholders, can be a useful mechanism for ensuring that senior","page_number":290,"box":{"x":116,"y":192,"width":738,"height":12}},{"id":"f51b2df2-c5db-4ac4-93cc-b91d38658fac","block_type":"box","text":"management and the board are aware of potential misconduct or breaches in risk management and","page_number":290,"box":{"x":117,"y":207,"width":745,"height":12}},{"id":"cba3b987-f91a-49a3-80b6-b0f509226b79","block_type":"box","text":"internal control processes.","page_number":290,"box":{"x":117,"y":223,"width":200,"height":12}},{"id":"245ab757-ce94-4329-b56c-6c678981ab72","block_type":"box","text":"A comprehensive audit conducted by an independent audit firm contributes to investor confidence in","page_number":290,"box":{"x":116,"y":250,"width":748,"height":12}},{"id":"d5fd9125-e14d-4a4a-8bd7-ef60db41eedb","block_type":"box","text":"the quality of corporate reporting. It is helpful when the audit report gives some insight into the scope","page_number":290,"box":{"x":116,"y":266,"width":752,"height":12}},{"id":"398375fa-15c5-4768-bed8-b066601180d2","block_type":"box","text":"and focus of the audit, as well as any critical audit matters identified and how these were resolved. A","page_number":290,"box":{"x":116,"y":281,"width":751,"height":12}},{"id":"0e43e1e4-d4b4-4b4f-8019-11ff26eeda85","block_type":"box","text":"comprehensive and effective audit is time and resource intensive, and the audit fee should be","page_number":290,"box":{"x":116,"y":297,"width":700,"height":12}},{"id":"ffb56df3-c8f5-4d44-909b-8f980f8de191","block_type":"box","text":"commensurate. Fees paid to the audit firm for non-audit consulting should not exceed the audit fee to a","page_number":290,"box":{"x":116,"y":312,"width":771,"height":12}},{"id":"a80ce7e5-54ba-435b-b0bc-9e0195eb2bd4","block_type":"box","text":"degree that may prompt concerns about the independence of the audit. The audit committee should","page_number":290,"box":{"x":116,"y":328,"width":746,"height":12}},{"id":"29a9c398-aa6f-4c52-9efe-ce7343f50346","block_type":"box","text":"explain its position on auditor tenure and how it confirmed that the auditor remained independent.","page_number":290,"box":{"x":116,"y":343,"width":728,"height":12}},{"id":"541393d5-19b9-43aa-a897-83859389c253","block_type":"box","text":"We may vote against the election of the responsible directors if corporate reporting is insufficient or","page_number":290,"box":{"x":116,"y":370,"width":740,"height":12}},{"id":"e0e017d1-7093-4119-998a-bf3d1e368316","block_type":"box","text":"there are material misstatements in financial reports. In markets where relevant, we may vote against a","page_number":290,"box":{"x":116,"y":386,"width":771,"height":12}},{"id":"11502279-c989-4d1f-97b6-65e77341c3b8","block_type":"box","text":"proposal to approve the financial statements or the discharge of the board when we are concerned","page_number":290,"box":{"x":117,"y":401,"width":737,"height":12}},{"id":"405e1c7d-67e1-480e-9724-74803a50746e","block_type":"box","text":"about the quality of corporate reporting or the audit. We may vote against proposals to appoint the","page_number":290,"box":{"x":116,"y":417,"width":734,"height":12}},{"id":"d564586f-37c6-4837-9f4a-09be2e78749f","block_type":"box","text":"auditor, ratify the audit report, or approve the audit fee if we are concerned about the auditor’s","page_number":290,"box":{"x":116,"y":432,"width":702,"height":12}},{"id":"3af3810b-ea71-4394-8dfa-7793d6a94fd1","block_type":"box","text":"independence, the quality of the audit, or there are material misstatements in financial reports and the","page_number":290,"box":{"x":117,"y":448,"width":760,"height":12}},{"id":"1a63c8cc-e6f1-442c-a1d0-50ddd7dd372f","block_type":"box","text":"board has not established reasonable remediation plans.","page_number":290,"box":{"x":117,"y":464,"width":426,"height":11}},{"id":"649dc148-cb45-4633-8122-1d5efaad09a1","block_type":"box","text":"SHAREHOLDER RIGHTS AND PROTECTIONS","page_number":290,"box":{"x":318,"y":496,"width":369,"height":10}},{"id":"947815c1-6a9a-4f7f-a83c-68ac9636faf1","block_type":"box","text":"General shareholder meetings","page_number":290,"box":{"x":116,"y":524,"width":247,"height":12}},{"id":"547bc0bc-fbb7-4b29-b02f-7a25c9e39458","block_type":"box","text":"Companies normally have an annual general meeting of shareholders at which routine and non-routine","page_number":290,"box":{"x":117,"y":551,"width":768,"height":12}},{"id":"c0068598-80d7-4eeb-ab17-dd1756fe7fde","block_type":"box","text":"items of business are discussed and voted on by shareholders in attendance or submitting proxy votes.","page_number":290,"box":{"x":117,"y":567,"width":771,"height":12}},{"id":"6d2d64fd-bbef-45c3-8ff8-1fb01263261e","block_type":"box","text":"Companies should disclose materials relevant to the shareholder meeting sufficiently in advance so","page_number":290,"box":{"x":117,"y":582,"width":742,"height":12}},{"id":"f457af97-e51f-4ca2-8544-742f74b19327","block_type":"box","text":"that shareholders can take them into consideration in their voting decisions. Many companies offer","page_number":290,"box":{"x":116,"y":598,"width":736,"height":12}},{"id":"021ee4dd-3ea5-47f3-8411-b80a4a029420","block_type":"box","text":"shareholders the option of participating in the meeting virtually which, whilst welcome, should not limit","page_number":290,"box":{"x":116,"y":613,"width":758,"height":12}},{"id":"565b9992-4fad-4607-8cc8-ada522e7accc","block_type":"box","text":"the rights of shareholders to participate as they would during an in-person meeting.","page_number":290,"box":{"x":116,"y":629,"width":622,"height":12}},{"id":"638d036c-b651-445f-8ad8-0afa83b4d1fb","block_type":"box","text":"We may vote against directors when materials related to the business of the shareholder meeting are","page_number":290,"box":{"x":116,"y":656,"width":757,"height":12}},{"id":"1f9dab27-f9da-4dff-9f3f-6c4cc535c35e","block_type":"box","text":"not provided in a timely manner or do not provide sufficient information for us to make an informed","page_number":290,"box":{"x":117,"y":671,"width":728,"height":12}},{"id":"142f57ae-3d52-4b4d-8805-39d5dcd4f9dd","block_type":"box","text":"voting decision. We may vote against directors if the format of the shareholder meeting does not","page_number":290,"box":{"x":116,"y":687,"width":715,"height":12}},{"id":"f40a0e0a-70b8-4d17-90dd-0c5faff43231","block_type":"box","text":"accommodate reasonable shareholder participation.","page_number":290,"box":{"x":116,"y":702,"width":385,"height":12}},{"id":"16d06955-fc6f-4c23-8121-e5d79b2bd59a","block_type":"box","text":"Bylaw amendments","page_number":290,"box":{"x":117,"y":730,"width":155,"height":12}},{"id":"1055a2df-0d3c-4fb9-b5f2-e760351f9adb","block_type":"box","text":"We review bylaw amendments proposed by management on a case-by-case basis and will generally","page_number":290,"box":{"x":116,"y":757,"width":748,"height":12}},{"id":"2f700b50-9d3d-4d42-8d07-2bd1b381ee9d","block_type":"box","text":"support those that are aligned with the interests of minority shareholders. Any material changes to the","page_number":290,"box":{"x":116,"y":772,"width":755,"height":12}},{"id":"28c7707f-3fc5-4c64-80d1-2cccaa34aa38","block_type":"box","text":"bylaws should be explained in detail and put to a shareholder vote.","page_number":290,"box":{"x":117,"y":788,"width":494,"height":12}},{"id":"155bed26-04ed-4ac3-a721-8bcb83cb25e7","block_type":"box","text":"9","page_number":290,"box":{"x":143,"y":813,"width":4,"height":5}},{"id":"d47f4eca-d544-4322-97e9-e8f99c6cd67a","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Reporting Standards (IFRS)","page_number":290,"box":{"x":170,"y":813,"width":666,"height":10}},{"id":"6cbe7eed-5169-4f12-a31a-e1b43d55478f","block_type":"box","text":"Foundation. Please refer to the IFRS website to learn more about the framework and standards S1 “General","page_number":290,"box":{"x":171,"y":826,"width":641,"height":8}},{"id":"cfbe8520-e77c-44a0-8ad6-4f3482aaca1c","block_type":"box","text":"Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related Disclosures.”","page_number":290,"box":{"x":171,"y":839,"width":672,"height":9}},{"id":"ae349fb6-95c5-47e2-a845-867e03ab256e","block_type":"box","text":"10","page_number":290,"box":{"x":144,"y":854,"width":8,"height":5}},{"id":"b8bae956-c9ef-491e-9bc6-28c399e231d2","block_type":"box","text":"See, for examples, https://www.ifrs.org/news-and-events/news/2025/06/ifrs-foundation-publishes-jurisdictional-profiles","page_number":290,"box":{"x":170,"y":854,"width":705,"height":9}},{"id":"f905a4ea-e0c2-4edd-9278-d33579f9d3e0","block_type":"box","text":"issb-standards/ and https://finance.ec.europa.eu/capital-markets-union-and-financial-markets/company","page_number":290,"box":{"x":170,"y":867,"width":615,"height":9}},{"id":"bc5f3ce9-48df-4bcd-99d6-396c50d3bd35","block_type":"box","text":"reporting-and-auditing/company-reporting/corporate-sustainability-reporting_en","page_number":290,"box":{"x":170,"y":880,"width":468,"height":9}},{"id":"a7f43398-313a-4ef9-9992-eed52796fc08","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":290,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"d963132a-91c2-4cf6-8f00-bfc8feaa5deb","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":290,"box":{"x":530,"y":909,"width":324,"height":12}},{"id":"2ff43f80-be34-4ac7-8c08-c83af51db0a5","block_type":"box","text":"13","page_number":290,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"f79960dd-6be8-465a-aac7-f485f74fea91","block_type":"box","text":"NM1026U-6004382-290/605","page_number":290,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"978e200b-b098-4a23-949f-3340aa948ea0","block_type":"box","text":"We may vote against bylaw amendments that reduce shareholder rights and protections or introduce","page_number":291,"box":{"x":116,"y":87,"width":753,"height":12}},{"id":"900f1d7b-9d6c-4e5a-bc13-23c65f9e66d9","block_type":"box","text":"additional burdens. We may vote against directors if material changes are made to the bylaws without","page_number":291,"box":{"x":116,"y":102,"width":760,"height":13}},{"id":"59bfe0f4-f16a-4f8a-8a3b-ef3c7047fa1f","block_type":"box","text":"shareholder approval.","page_number":291,"box":{"x":116,"y":118,"width":167,"height":12}},{"id":"ab5594a1-a76f-4c6f-8aa7-71d355530123","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders,","page_number":291,"box":{"x":117,"y":150,"width":688,"height":12}},{"id":"6212c5b3-e983-4f34-ab74-5f64b6704ccd","block_type":"box","text":"individually or as a group, with a meaningful shareholding, the right to call a special meeting of","page_number":291,"box":{"x":117,"y":165,"width":704,"height":12}},{"id":"d7b669a4-552e-4d95-918a-bceb4ef87caf","block_type":"box","text":"shareholders. The shareholding required to exercise this right should balance its utility with the cost to","page_number":291,"box":{"x":116,"y":181,"width":761,"height":12}},{"id":"0b33b48f-2682-4fba-8052-1c96235ebcab","block_type":"box","text":"the company of holding special meetings.","page_number":291,"box":{"x":116,"y":196,"width":313,"height":12}},{"id":"2ecad444-f37b-4ee6-b6b1-bbd381493d73","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders,","page_number":291,"box":{"x":117,"y":228,"width":688,"height":12}},{"id":"811dca85-a76b-4929-96a2-533f73a4bf55","block_type":"box","text":"individually or as a group, with a meaningful shareholding, the right to nominate directors to the","page_number":291,"box":{"x":117,"y":243,"width":710,"height":12}},{"id":"ffe18655-75fd-4cfa-8130-b6bc48343e93","block_type":"box","text":"company’s board. The threshold for this right should be set so that shareholders can exercise it without","page_number":291,"box":{"x":116,"y":259,"width":770,"height":12}},{"id":"aa70d42e-e36d-479a-8959-01d339199930","block_type":"box","text":"being unduly disruptive to the board’s own nomination process.","page_number":291,"box":{"x":117,"y":274,"width":473,"height":12}},{"id":"5da59584-6bba-43be-bce4-01580d8df1b5","block_type":"box","text":"Whilst we would not use either of these rights ourselves, we see them as important accountability","page_number":291,"box":{"x":116,"y":306,"width":728,"height":12}},{"id":"563dd367-28ca-436e-9c2c-2ec757a0d2ae","block_type":"box","text":"mechanisms. We may vote for a shareholder proposal seeking the addition of either of these","page_number":291,"box":{"x":117,"y":321,"width":691,"height":12}},{"id":"f0a80c6a-c673-4c0d-b2d4-0a6f193f883d","block_type":"box","text":"provisions to a company’s bylaws.","page_number":291,"box":{"x":117,"y":337,"width":258,"height":12}},{"id":"2a940770-3d7b-4cb4-b0dd-adbd5d131ad1","block_type":"box","text":"Change of domicile","page_number":291,"box":{"x":116,"y":368,"width":160,"height":12}},{"id":"09960fe9-856c-4f62-8268-14fb187ea323","block_type":"box","text":"We generally defer to management on proposals to change a company’s domicile as long as the","page_number":291,"box":{"x":116,"y":400,"width":722,"height":12}},{"id":"fe1b29fd-64c6-4d1b-9771-4731925af6f3","block_type":"box","text":"rationale for doing so is consistent with the company’s long-term strategy and business model and the","page_number":291,"box":{"x":117,"y":415,"width":761,"height":12}},{"id":"3f3e3997-f4d5-4a73-b8d3-2d7661be83d6","block_type":"box","text":"related costs are immaterial.","page_number":291,"box":{"x":117,"y":431,"width":215,"height":9}},{"id":"2f5386f7-43a1-45db-958d-a75cc214afb7","block_type":"box","text":"We may vote against directors or a proposal to change a company’s domicile where it does not seem","page_number":291,"box":{"x":116,"y":462,"width":757,"height":12}},{"id":"f2bbdfa9-cc68-42a1-b33a-d903489098b8","block_type":"box","text":"aligned with our clients’ financial interests.","page_number":291,"box":{"x":116,"y":478,"width":318,"height":12}},{"id":"fa0cbbac-0549-4e22-8ab8-1ce8f026720a","block_type":"box","text":"Changes to a company’s purpose or the nature of its business","page_number":291,"box":{"x":116,"y":509,"width":504,"height":12}},{"id":"e8a33e7a-8022-4d1c-88be-337e7a596550","block_type":"box","text":"Plans to materially change the nature of a company’s business or its purpose should be disclosed and","page_number":291,"box":{"x":117,"y":541,"width":762,"height":12}},{"id":"0c036cc7-990a-4f68-9aa0-28a8c6f4aca6","block_type":"box","text":"explained in the context of long-term strategy and business dynamics. Such changes may significantly","page_number":291,"box":{"x":116,"y":556,"width":764,"height":12}},{"id":"b9bd8fd9-5d57-4f93-bf6b-398c861d1792","block_type":"box","text":"alter an investor’s views on the suitability of a company for their investment strategy or portfolio.","page_number":291,"box":{"x":116,"y":572,"width":716,"height":12}},{"id":"98929e51-e730-498c-9bdc-946905a33e5b","block_type":"box","text":"Where relevant, we may vote against proposals to change a company’s purpose or the nature of its","page_number":291,"box":{"x":116,"y":603,"width":743,"height":12}},{"id":"d5617c65-de04-45a4-87c9-abb51d286ba4","block_type":"box","text":"business if the board has not provided a credible argument for change.","page_number":291,"box":{"x":117,"y":619,"width":530,"height":12}},{"id":"315295b4-b119-4a5a-a479-7a92ea690ad0","block_type":"box","text":"SHAREHOLDER PROPOSALS","page_number":291,"box":{"x":380,"y":658,"width":244,"height":10}},{"id":"66d1213f-735e-421d-9ace-6b041259a383","block_type":"box","text":"Shareholders in many markets, who meet certain eligibility criteria, have the right to submit proposals","page_number":291,"box":{"x":116,"y":690,"width":750,"height":12}},{"id":"710c19d7-3943-4bac-abdb-1e4af3362f04","block_type":"box","text":"to the general shareholder meeting asking a company to take a particular course of action subject to","page_number":291,"box":{"x":116,"y":705,"width":744,"height":13}},{"id":"0a9e2693-88d1-4324-9a70-4dc2b1fd9037","block_type":"box","text":"the proposal being supported by a majority of votes cast at the meeting. The topics raised can address","page_number":291,"box":{"x":116,"y":721,"width":762,"height":12}},{"id":"a419fa7a-5c38-40e2-9d1c-9d418800b04d","block_type":"box","text":"a range of matters that may be relevant to a company’s business.","page_number":291,"box":{"x":116,"y":736,"width":486,"height":13}},{"id":"d1d63f89-97d3-4381-9656-c26cb24b188a","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":291,"box":{"x":116,"y":768,"width":762,"height":12}},{"id":"e681eaaf-a54b-4bb7-87b7-79a9e31ed3a1","block_type":"box","text":"company’s business and its current approach, whether the actions sought are consistent with","page_number":291,"box":{"x":116,"y":784,"width":691,"height":12}},{"id":"8cc2e9f6-5ffa-42ac-867b-77b508076944","block_type":"box","text":"shareholders’ interests, and what impact the proposal being acted upon might have on financial","page_number":291,"box":{"x":116,"y":799,"width":708,"height":12}},{"id":"8dd51f9e-956d-4560-85f1-e586855d1133","block_type":"box","text":"performance.","page_number":291,"box":{"x":117,"y":814,"width":96,"height":12}},{"id":"b79921c5-eb6d-4e20-bd7c-45b67da2d445","block_type":"box","text":"Our general approach where we have concerns about a company’s governance, disclosures or","page_number":291,"box":{"x":116,"y":846,"width":711,"height":12}},{"id":"1dd42971-6be0-4bb7-9fbb-d23741999594","block_type":"box","text":"performance is to engage to understand the apparent difference in perspective. If we are concerned a","page_number":291,"box":{"x":117,"y":861,"width":760,"height":13}},{"id":"940ee6d1-8584-41c8-a07b-940c7892d9f1","block_type":"box","text":"company is not acting in shareholders’ financial interests, we may vote against the election of directors.","page_number":291,"box":{"x":116,"y":877,"width":772,"height":12}},{"id":"d9e8661e-f559-4b37-a7df-9fc25f956305","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":291,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"48443e38-8688-4ce1-b470-5d2c4e130cb8","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":291,"box":{"x":530,"y":909,"width":324,"height":12}},{"id":"276a95d6-6123-4e7a-90be-4cabe1b9881e","block_type":"box","text":"14","page_number":291,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"a3ab2c43-709d-42ba-83f2-c6bd9a3a5572","block_type":"box","text":"NM1026U-6004382-291/605","page_number":291,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"44b4e4a1-2e85-46ac-a8ff-f7b653f4bd84","block_type":"box","text":"We may support a relevant shareholder proposal if doing so is aligned with our clients’ financial","page_number":292,"box":{"x":116,"y":87,"width":712,"height":12}},{"id":"854ad787-9d63-47ad-868e-fe5a3fa2d8d1","block_type":"box","text":"interests. We generally do not support shareholder proposals that are legally binding on the company,","page_number":292,"box":{"x":117,"y":103,"width":760,"height":12}},{"id":"cf6fc140-addf-4195-b421-39c96929170c","block_type":"box","text":"seek to alter a company’s strategy or direct its operations, or are unrelated to how a company","page_number":292,"box":{"x":116,"y":118,"width":700,"height":12}},{"id":"680f5699-1380-4cc5-9b4f-57f3a07e895d","block_type":"box","text":"manages risk or generates financial returns.","page_number":292,"box":{"x":117,"y":134,"width":331,"height":12}},{"id":"a7bfee3f-dffd-41fb-958a-e52f713869be","block_type":"box","text":"BlackRock is subject to rules, regulations, agency guidance and contractual agreements that place","page_number":292,"box":{"x":117,"y":164,"width":737,"height":12}},{"id":"937b902a-9388-41af-9995-f6f73cfee367","block_type":"box","text":"restrictions and limitations on how we can interact with the companies in which we invest on behalf of","page_number":292,"box":{"x":117,"y":180,"width":755,"height":12}},{"id":"20252990-6e20-4813-9b7a-6ae1e1b06c9d","block_type":"box","text":"our clients, including our ability to submit shareholder proposals. We do not submit shareholder","page_number":292,"box":{"x":116,"y":195,"width":712,"height":12}},{"id":"37b662ef-9b77-48e4-aff7-fe4373a2f617","block_type":"box","text":"proposals but can vote, on behalf of clients who authorize us to do so, on proposals put forth by others.","page_number":292,"box":{"x":117,"y":211,"width":770,"height":12}},{"id":"0a3b9b56-b2a4-455c-835a-f6fa5c436045","block_type":"box","text":"CORPORATE POLITICAL ACTIVITIES","page_number":292,"box":{"x":351,"y":249,"width":302,"height":10}},{"id":"5d06239c-e6fc-4098-8ca7-08eb499e4fc9","block_type":"box","text":"A corporation’s ability to engage in the policy process is subject to rules and regulations set by the","page_number":292,"box":{"x":116,"y":280,"width":733,"height":12}},{"id":"89ce435d-c10d-4174-9a0e-5d9f9a9e8e22","block_type":"box","text":"jurisdictions in which they engage. When a corporation reports material financial risk related to policy","page_number":292,"box":{"x":115,"y":295,"width":754,"height":12}},{"id":"7919499c-419f-4220-8b2b-642a5ef9886b","block_type":"box","text":"and or regulatory changes, BAIS may seek to understand how it is addressing the material risk","page_number":292,"box":{"x":116,"y":311,"width":708,"height":12}},{"id":"dc16cce2-34c9-4163-91bf-97b3eb87eed5","block_type":"box","text":"identified. We seek to understand how companies engage in corporate political activities and ensure","page_number":292,"box":{"x":117,"y":326,"width":748,"height":12}},{"id":"d4612e47-e6c2-49e8-8804-d7d3e40d16f4","block_type":"box","text":"that their participation is consistent with their public statements on policy matters material to the","page_number":292,"box":{"x":116,"y":342,"width":714,"height":12}},{"id":"41560067-8534-472f-9a07-b35c3ee7b39d","block_type":"box","text":"company’s long-term strategy. The board should be aware of the approach taken by management on","page_number":292,"box":{"x":116,"y":357,"width":756,"height":12}},{"id":"8a976329-a5c8-4d7b-a630-c25fb681a273","block_type":"box","text":"corporate political activities as there can be reputational risks arising from inconsistencies between a","page_number":292,"box":{"x":116,"y":373,"width":752,"height":12}},{"id":"c73217aa-17be-4eba-b048-aefcf216c3c3","block_type":"box","text":"company’s policy engagement and stated policy positions. Companies should, as a minimum, meet all","page_number":292,"box":{"x":116,"y":388,"width":764,"height":12}},{"id":"e44333c8-d0c7-4691-b15c-54aac651c9d2","block_type":"box","text":"regulatory disclosure requirements on political activities. We may engage a company where we would","page_number":292,"box":{"x":117,"y":404,"width":759,"height":12}},{"id":"40a93246-cc9e-4b11-945a-607aa39faf7c","block_type":"box","text":"like to better understand its approach to policy engagement, where relevant.","page_number":292,"box":{"x":117,"y":419,"width":569,"height":12}},{"id":"1171e65d-828d-4b6c-a951-b5bbeb50cfec","block_type":"box","text":"To mitigate the risk of inconsistencies, companies may wish to assess the alignment between their","page_number":292,"box":{"x":116,"y":450,"width":737,"height":12}},{"id":"8df4936d-2ef5-48aa-b1f4-201b0822a2aa","block_type":"box","text":"policy priorities and the policy positions of the trade associations of which they are active members and","page_number":292,"box":{"x":117,"y":465,"width":770,"height":13}},{"id":"ba4e7bb3-6029-4098-9460-2a713379c396","block_type":"box","text":"any engagements undertaken by trade associations on behalf of members.","page_number":292,"box":{"x":116,"y":481,"width":562,"height":12}},{"id":"0e89b823-051b-4ed4-b5b4-98af154cc165","block_type":"box","text":"We may support a relevant shareholder proposal, or vote against directors, where a company’s","page_number":292,"box":{"x":116,"y":512,"width":712,"height":12}},{"id":"cf8d8ce0-b75e-4683-9d89-260cb5b9a37f","block_type":"box","text":"disclosures are insufficient to address the material risk it has identified.","page_number":292,"box":{"x":116,"y":527,"width":530,"height":10}},{"id":"3658cb58-3195-44c4-abed-ab62fe0ce2bb","block_type":"box","text":"MATERIAL SUSTAINABILITY-RELATED RISKS AND OPPORTUNITIES","page_number":292,"box":{"x":223,"y":565,"width":559,"height":10}},{"id":"b9b80fbf-5384-4199-a9b2-e35b693581c8","block_type":"box","text":"We seek to understand how companies manage the material risks and opportunities inherent in their","page_number":292,"box":{"x":116,"y":596,"width":751,"height":12}},{"id":"57a09081-a6d4-4adc-abcc-60be1705529f","block_type":"box","text":"business operations. In our experience, sustainability-related factors","page_number":292,"box":{"x":117,"y":612,"width":505,"height":12}},{"id":"3734edaa-ced4-4522-a3e3-093a1e209666","block_type":"box","text":"11","page_number":292,"box":{"x":624,"y":612,"width":9,"height":6}},{"id":"ad3364e2-fc42-4905-b452-b77fbe01c82b","block_type":"box","text":"that are relevant to a company’s","page_number":292,"box":{"x":635,"y":612,"width":249,"height":12}},{"id":"f5c2fe7d-564d-4975-a29f-d8ea5e0ee3a2","block_type":"box","text":"business or material to its financial performance, are generally operational considerations embedded","page_number":292,"box":{"x":117,"y":627,"width":752,"height":12}},{"id":"cd91f48b-f7ca-4c6e-9aa3-b076c45d1401","block_type":"box","text":"into day-to-day management systems. Certain sustainability issues may also inform long-term strategic","page_number":292,"box":{"x":117,"y":643,"width":769,"height":12}},{"id":"3c7724e1-3ec8-4ca2-8551-e8c23b0b521f","block_type":"box","text":"planning, for example, investing in product innovation in anticipation of changing consumer demand or","page_number":292,"box":{"x":117,"y":658,"width":763,"height":12}},{"id":"6a0696e4-0d9d-484e-8c98-710cece97b6f","block_type":"box","text":"adapting supply chains in response to changing regulatory requirements.","page_number":292,"box":{"x":116,"y":674,"width":540,"height":12}},{"id":"37c3b16b-15e2-48c1-ae44-1b51346c3846","block_type":"box","text":"We recognize that the specific sustainability-related factors that may be financially material or business","page_number":292,"box":{"x":116,"y":704,"width":763,"height":12}},{"id":"f26b964a-6505-4a6a-abed-92ff9484e0c9","block_type":"box","text":"relevant will vary by company business model, sector, key markets, and time horizon, amongst other","page_number":292,"box":{"x":117,"y":720,"width":747,"height":12}},{"id":"9837f4d8-957e-49e5-bf48-0b8201ba7b83","block_type":"box","text":"considerations. From company disclosures and our engagement, we aim to understand how","page_number":292,"box":{"x":116,"y":735,"width":684,"height":12}},{"id":"dece81b0-2b55-418e-85a5-a698f09189be","block_type":"box","text":"management is identifying, assessing and integrating material sustainability-related risks and","page_number":292,"box":{"x":117,"y":751,"width":688,"height":12}},{"id":"3feec32d-1ff2-494a-9271-4e7a6a19ac26","block_type":"box","text":"11","page_number":292,"box":{"x":144,"y":776,"width":7,"height":5}},{"id":"7b35c6c5-c381-4807-8336-c1df58123407","block_type":"box","text":"By material sustainability-related risks and opportunities, we mean the drivers of risk and financial value creation in a","page_number":292,"box":{"x":171,"y":776,"width":691,"height":10}},{"id":"d837e841-7465-4e7a-aeaf-9c029d778e72","block_type":"box","text":"company’s business model that have an environmental or social dependency or impact. Examples of environmental","page_number":292,"box":{"x":170,"y":789,"width":686,"height":10}},{"id":"1c9797af-7521-4193-b088-d83ae958b4c1","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":292,"box":{"x":170,"y":802,"width":682,"height":9}},{"id":"5348d231-217d-4b0f-ae8e-485fac1a5892","block_type":"box","text":"issues include, but are not limited to, human capital management, impacts on the communities in which a company","page_number":292,"box":{"x":170,"y":815,"width":683,"height":9}},{"id":"3f972016-5d58-48a2-bf76-afb3c1f33e9e","block_type":"box","text":"operates, customer loyalty, and relationships with regulators. It is our view that well-managed companies will effectively","page_number":292,"box":{"x":170,"y":828,"width":708,"height":9}},{"id":"3d477791-fd42-434e-bb01-4027ba2b40d9","block_type":"box","text":"evaluate and manage material sustainability-related risks and opportunities relevant to their businesses. Governance is","page_number":292,"box":{"x":170,"y":841,"width":707,"height":9}},{"id":"c308e3a8-ebc1-4908-9995-fc12f384fa06","block_type":"box","text":"the core means by which boards can oversee the creation of durable financial value over time. Appropriate risk","page_number":292,"box":{"x":170,"y":853,"width":658,"height":10}},{"id":"4f1d5e5f-ab20-4549-a42e-41643343774d","block_type":"box","text":"oversight of business-relevant and material sustainability-related considerations is a component of a sound governance","page_number":292,"box":{"x":170,"y":866,"width":708,"height":10}},{"id":"366ff920-705c-4eca-ab36-9e28015b56d4","block_type":"box","text":"framework.","page_number":292,"box":{"x":170,"y":879,"width":65,"height":8}},{"id":"8218801b-cde0-47b7-8bee-a5af7db06521","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":292,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"39bfcf34-04ce-4ff7-b760-177547612421","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":292,"box":{"x":530,"y":909,"width":324,"height":12}},{"id":"851fe603-96e4-40a3-94ef-a96f9a6cdb85","block_type":"box","text":"15","page_number":292,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"95b90191-0ad2-47e2-80c7-db67303c1903","block_type":"box","text":"NM1026U-6004382-292/605","page_number":292,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"68e186ce-9b40-4ff6-86ab-2a2da9aaa409","block_type":"box","text":"opportunities into their business decision-making and practices. Doing so helps us undertake a more","page_number":293,"box":{"x":116,"y":87,"width":752,"height":12}},{"id":"be7ab5f8-94c4-4819-8c33-12ea39a7b788","block_type":"box","text":"holistic assessment of a company’s potential financial performance and the likely risk-adjusted returns","page_number":293,"box":{"x":117,"y":102,"width":761,"height":13}},{"id":"5486ccce-5cd1-4fe9-9496-76957eeb18d3","block_type":"box","text":"of an investment.","page_number":293,"box":{"x":116,"y":118,"width":133,"height":10}},{"id":"a56a382d-0345-47ee-b65d-27c6d88fad99","block_type":"box","text":"We may vote against directors or support a relevant shareholder proposal if we have concerns about","page_number":293,"box":{"x":116,"y":145,"width":753,"height":12}},{"id":"4bbcd358-e9d6-44e4-b19a-65c79b485eea","block_type":"box","text":"how a company is managing or disclosing its approach to material sustainability-related risks that may","page_number":293,"box":{"x":117,"y":161,"width":761,"height":12}},{"id":"0b351412-92c8-44c5-b4e9-b7bbc0990c7f","block_type":"box","text":"impact financial returns.","page_number":293,"box":{"x":117,"y":176,"width":181,"height":12}},{"id":"913d34d5-fc7b-4fc9-8309-55dd049f0b1d","block_type":"box","text":"KEY STAKEHOLDERS","page_number":293,"box":{"x":412,"y":209,"width":182,"height":10}},{"id":"a3760b6e-be67-46c2-9230-f0afe575376d","block_type":"box","text":"In our view, companies should understand and take into consideration the interests of the various","page_number":293,"box":{"x":117,"y":236,"width":727,"height":12}},{"id":"f3fb6b2b-3b1a-48fd-a0de-9e08d0c7a694","block_type":"box","text":"parties on whom they depend for their success over time. It is for each company to determine their key","page_number":293,"box":{"x":117,"y":252,"width":766,"height":12}},{"id":"fbb38c75-8888-47d6-83b1-d434fb4bc8c8","block_type":"box","text":"stakeholders based on what is material to their business and long-term financial performance. For","page_number":293,"box":{"x":116,"y":267,"width":731,"height":12}},{"id":"af608f79-05c1-4a92-93f5-9647f425dac4","block_type":"box","text":"many companies, key stakeholders include employees, business partners (such as suppliers and","page_number":293,"box":{"x":117,"y":283,"width":726,"height":12}},{"id":"291f01b9-82d2-4d78-8e73-a82e401492ad","block_type":"box","text":"distributors), clients and consumers, regulators, and the communities in which they operate.","page_number":293,"box":{"x":116,"y":298,"width":687,"height":12}},{"id":"64e05502-d7c7-477f-851d-ff0f76dfcfca","block_type":"box","text":"Companies that appropriately balance the interests of investors and other stakeholders are, in our","page_number":293,"box":{"x":117,"y":314,"width":730,"height":12}},{"id":"b9704f9e-e72f-4815-b777-cd538b71d3b5","block_type":"box","text":"experience, more likely to be financially resilient over time.","page_number":293,"box":{"x":116,"y":329,"width":438,"height":12}},{"id":"435f98a9-2270-454a-8cff-c223e98b4671","block_type":"box","text":"CLIMATE AND DECARBONIZATION INVESTMENT OBJECTIVES","page_number":293,"box":{"x":246,"y":362,"width":513,"height":10}},{"id":"0c7bb55e-de9d-4099-9fed-de8e01d609c5","block_type":"box","text":"Certain active BlackRock funds have climate and decarbonization objectives in addition to financial","page_number":293,"box":{"x":117,"y":389,"width":737,"height":12}},{"id":"ec849904-afc0-4f0f-8d2c-604dbea56ba9","block_type":"box","text":"objectives. Consistent with the objectives of those investment strategies, our stewardship activity in","page_number":293,"box":{"x":116,"y":405,"width":741,"height":12}},{"id":"8239e442-10e9-4333-af92-3e6c0ef0e251","block_type":"box","text":"relation to the holdings in those funds differs in some respects from BAIS’ benchmark guidelines, which","page_number":293,"box":{"x":117,"y":420,"width":771,"height":12}},{"id":"88cd19ba-c94a-4e4a-85c1-69e006d36915","block_type":"box","text":"are described above. Specifically, for those funds’ holdings, we look to investee companies to","page_number":293,"box":{"x":116,"y":436,"width":699,"height":12}},{"id":"f3ed00f8-6ebe-4916-af73-b41ff706fd7a","block_type":"box","text":"demonstrate that they are aligned with a decarbonization pathway that means their business model","page_number":293,"box":{"x":116,"y":451,"width":742,"height":12}},{"id":"fe0c4f96-7efe-4e94-8718-eea871cc1ca2","block_type":"box","text":"would be viable in a low-carbon economy, i.e., one in which global temperature rise is limited to 1.5°C","page_number":293,"box":{"x":116,"y":467,"width":759,"height":12}},{"id":"ba47a03b-b248-4cc6-a84d-8a478ccf93e0","block_type":"box","text":"above pre-industrial levels. In addition, clients in separately managed accounts may instruct BlackRock","page_number":293,"box":{"x":116,"y":482,"width":771,"height":12}},{"id":"8c5809ea-49c0-4cb3-8bcd-ae35f3aedb4b","block_type":"box","text":"to apply these guidelines to their holdings. Both in the case of funds and separately managed","page_number":293,"box":{"x":116,"y":498,"width":698,"height":12}},{"id":"eaa4fb08-60cb-490c-86d1-88cd6e616d80","block_type":"box","text":"accounts, these guidelines are only implemented upon explicit selection and approval by the applicable","page_number":293,"box":{"x":116,"y":514,"width":770,"height":11}},{"id":"7d8778f0-be1e-46cb-bb6e-92f1bc9984ea","block_type":"box","text":"fund board or client.","page_number":293,"box":{"x":116,"y":529,"width":153,"height":9}},{"id":"b705da59-7a68-4cdd-8550-4de6d8d4ac2f","block_type":"box","text":"These decarbonization stewardship guidelines focus on companies which produce goods and services","page_number":293,"box":{"x":116,"y":556,"width":766,"height":12}},{"id":"463d010b-df54-42a4-bf18-71ee31cb45b4","block_type":"box","text":"that contribute to real world decarbonization or have a carbon intensive business model and face","page_number":293,"box":{"x":116,"y":571,"width":724,"height":10}},{"id":"925fa856-cee6-4994-9591-0c0960e2c2cb","block_type":"box","text":"outsized impacts from the low carbon transition, based on reported and estimated scopes 1, 2, and 3","page_number":293,"box":{"x":116,"y":587,"width":754,"height":12}},{"id":"fa2fcfdc-a22b-4d68-90ab-86daa7815d8e","block_type":"box","text":"greenhouse gas emissions. These companies should provide disclosures that set out their","page_number":293,"box":{"x":116,"y":603,"width":675,"height":12}},{"id":"63c38e59-2d06-42ba-bea1-5501729f09cb","block_type":"box","text":"governance, strategy, risk management processes and metrics and targets relevant to","page_number":293,"box":{"x":116,"y":618,"width":646,"height":12}},{"id":"69aacdbf-ee10-426c-8f45-7ed584b4a153","block_type":"box","text":"decarbonization. It is helpful to investors’ understanding when these disclosures include an explanation","page_number":293,"box":{"x":116,"y":634,"width":770,"height":12}},{"id":"95eba5b4-fc4d-4c08-b453-c7352e31fce5","block_type":"box","text":"of the decarbonization scenarios a company is using in its near- and long-term planning, as well as its","page_number":293,"box":{"x":116,"y":649,"width":760,"height":12}},{"id":"f7b552c2-3775-4f1d-84ee-77ae348bc32f","block_type":"box","text":"scope 1, scope 2 and material scope 3 greenhouse gas (GHG) emissions and reduction targets for","page_number":293,"box":{"x":116,"y":665,"width":735,"height":12}},{"id":"f1d298da-b6d9-4519-9c23-3dadb2296b47","block_type":"box","text":"scope 1 and 2 emissions.","page_number":293,"box":{"x":116,"y":680,"width":188,"height":12}},{"id":"b4632252-fe8d-4173-ab5d-ee483ce5fba6","block_type":"box","text":"Under these climate- and decarbonization-specific guidelines, BAIS may recommend a vote against","page_number":293,"box":{"x":117,"y":707,"width":739,"height":12}},{"id":"858d6d8d-5cf3-4cbe-83dd-4fd960bdb512","block_type":"box","text":"directors or support for a relevant shareholder proposal if a company does not appear to be adequately","page_number":293,"box":{"x":116,"y":723,"width":766,"height":12}},{"id":"84e597c4-22de-47d4-9bec-275a93994cda","block_type":"box","text":"acting to address or disclosing material climate-related risks, consistent with the parameters set out in","page_number":293,"box":{"x":116,"y":738,"width":755,"height":12}},{"id":"07935e2c-f51e-46d1-adc5-d8517cc2e1e2","block_type":"box","text":"these climate- and decarbonization-specific guidelines. We may recommend supporting shareholder","page_number":293,"box":{"x":116,"y":754,"width":744,"height":12}},{"id":"d4740829-3615-416c-84c6-e5443fbb71e9","block_type":"box","text":"proposals seeking information relevant to a company’s stated low-carbon transition strategy or targets","page_number":293,"box":{"x":117,"y":769,"width":755,"height":12}},{"id":"663da0d3-b36c-4439-9e81-721099c624f2","block_type":"box","text":"that the company does not currently provide and that would be helpful to investment decision-making.","page_number":293,"box":{"x":116,"y":785,"width":753,"height":12}},{"id":"cab80f10-ff4c-4dab-beb6-bc1963a9e4f1","block_type":"box","text":"We would not recommend support for shareholder proposals that seek to constrain board or","page_number":293,"box":{"x":116,"y":800,"width":684,"height":12}},{"id":"89da69ac-b5db-4d22-8be6-fbb880dc119b","block_type":"box","text":"management decision-making or direct specific business or strategic decisions. As under the BAIS","page_number":293,"box":{"x":117,"y":816,"width":730,"height":12}},{"id":"3074ea68-0f99-4cc4-a1b1-484f4487352a","block_type":"box","text":"benchmark approach, the active portfolio managers are ultimately responsible for voting consistent","page_number":293,"box":{"x":117,"y":831,"width":737,"height":12}},{"id":"61c45c10-1155-4df9-84d4-69a1b4b104fc","block_type":"box","text":"with their investment mandate and fund objectives. For the funds and accounts in scope, voting on","page_number":293,"box":{"x":116,"y":847,"width":736,"height":12}},{"id":"0ef2aa3c-049c-4e95-810b-ae9368ee883a","block_type":"box","text":"matters not related to climate risk and the energy transition is undertaken in line with BAIS’ benchmark","page_number":293,"box":{"x":117,"y":862,"width":765,"height":12}},{"id":"8c770960-0b39-456b-8891-3be4e9af2a97","block_type":"box","text":"guidelines.","page_number":293,"box":{"x":116,"y":878,"width":85,"height":12}},{"id":"a5fe7e83-368c-43cc-8048-086e4a62feac","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":293,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"06ed7b82-2704-4da6-bb66-63e779d6741a","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":293,"box":{"x":530,"y":909,"width":324,"height":12}},{"id":"9cb044eb-4940-4775-9c05-4cd4c27e3006","block_type":"box","text":"16","page_number":293,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"26aedb7d-9f5e-4b08-8d83-daf5e9bf2b68","block_type":"box","text":"NM1026U-6004382-293/605","page_number":293,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9fb87d8a-abfb-45ab-be78-998f1dd0ff9b","block_type":"box","text":"APPENDIX 1: HOW WE FULFIL AND OVERSEE OUR INVESTMENT STEWARDSHIP","page_number":294,"box":{"x":171,"y":87,"width":662,"height":10}},{"id":"c1108142-f75a-4a65-a2f5-76d7ec54caa5","block_type":"box","text":"RESPONSIBILITIES","page_number":294,"box":{"x":423,"y":102,"width":159,"height":10}},{"id":"9088ca1e-26fd-4651-99e3-7102409a044c","block_type":"box","text":"Oversight","page_number":294,"box":{"x":116,"y":132,"width":83,"height":12}},{"id":"dc23027b-9175-4ac8-9dab-84322ad84446","block_type":"box","text":"The Global Head of BAIS has primary oversight of and responsibility for the team’s activities, including","page_number":294,"box":{"x":116,"y":161,"width":764,"height":12}},{"id":"22fd7234-95cf-422a-9418-b667a9bb61e0","block_type":"box","text":"voting in accordance with the BlackRock Active Investment Stewardship Global Engagement and","page_number":294,"box":{"x":116,"y":177,"width":726,"height":12}},{"id":"e5fd8bb8-e82e-46b5-b39c-8536f604ce65","block_type":"box","text":"Voting Guidelines (the “Guidelines”), which require the application of professional judgment and","page_number":294,"box":{"x":116,"y":192,"width":714,"height":12}},{"id":"e690bbf4-f61d-4690-9233-52929a755be9","block_type":"box","text":"consideration of each company’s unique circumstances, as well as input from active investors. BAIS is","page_number":294,"box":{"x":116,"y":208,"width":765,"height":12}},{"id":"9a637c9f-6354-42e0-b4b0-1a01e065d4d9","block_type":"box","text":"independent from BlackRock Investment Stewardship in our engagement and voting activities,","page_number":294,"box":{"x":117,"y":223,"width":704,"height":12}},{"id":"994d4f83-a3d0-479d-8ec4-eb2f7fc0afc8","block_type":"box","text":"reporting lines, and oversight.","page_number":294,"box":{"x":117,"y":239,"width":224,"height":12}},{"id":"89b875a1-9b34-4b41-9c0b-2b08ed8d51da","block_type":"box","text":"The Stewardship Leaders Group, comprised of senior active investors and other relevant stakeholders","page_number":294,"box":{"x":116,"y":268,"width":765,"height":12}},{"id":"edb98d7f-bcb2-469a-b265-49911d5bf2a4","block_type":"box","text":"in BlackRock’s legal, public policy, sustainability and communications teams, helps shape the firm’s","page_number":294,"box":{"x":117,"y":283,"width":742,"height":12}},{"id":"53bf0317-46a4-44e0-9484-68ea2b0ce017","block_type":"box","text":"approach to investment stewardship on non-index equity investment strategies. The Group may advise","page_number":294,"box":{"x":116,"y":299,"width":769,"height":12}},{"id":"c6ff3b92-00c8-4841-ab37-ef42086e9443","block_type":"box","text":"on and review amendments to BAIS’ policies and practices. It does not determine voting decisions,","page_number":294,"box":{"x":116,"y":314,"width":739,"height":12}},{"id":"2fd34929-9cbd-4389-8ba9-c1282574ca56","block_type":"box","text":"which are the responsibility of BAIS and the relevant active equity investors.","page_number":294,"box":{"x":116,"y":330,"width":568,"height":12}},{"id":"cb0bdc3c-d0f1-47a2-a7f8-5adee532dc38","block_type":"box","text":"BAIS carries out engagement with companies in collaboration with active investment colleagues,","page_number":294,"box":{"x":117,"y":359,"width":721,"height":12}},{"id":"3f70dc11-15ea-4d88-bd9a-c3b274a8fb3c","block_type":"box","text":"executes proxy votes, and conducts vote operations (including maintaining records of votes cast) in a","page_number":294,"box":{"x":116,"y":375,"width":757,"height":12}},{"id":"80b12b79-5461-4c7c-81c4-a999669aaaaf","block_type":"box","text":"manner consistent with the Guidelines. BAIS also conducts research on corporate governance issues","page_number":294,"box":{"x":117,"y":390,"width":757,"height":12}},{"id":"c4853174-b844-4bf9-84ba-8b2682c682cf","block_type":"box","text":"and participates in industry discussions to contribute to and keep abreast of important developments in","page_number":294,"box":{"x":116,"y":406,"width":768,"height":12}},{"id":"999f54e6-9362-4b55-abc7-f0794d21f305","block_type":"box","text":"the corporate governance field. BAIS may use third parties for certain of the foregoing activities and","page_number":294,"box":{"x":116,"y":421,"width":744,"height":12}},{"id":"452df404-fbdf-444b-936e-61c9c8cbafcd","block_type":"box","text":"performs oversight of those third parties (see “Use and oversight of third-party vote services providers”","page_number":294,"box":{"x":117,"y":437,"width":765,"height":12}},{"id":"18875c59-4b26-405b-92de-1fa35791041f","block_type":"box","text":"below).","page_number":294,"box":{"x":117,"y":452,"width":58,"height":12}},{"id":"4c8ce120-a95b-4475-89a6-0b49f521e0b3","block_type":"box","text":"Voting guidelines and vote execution","page_number":294,"box":{"x":116,"y":482,"width":302,"height":11}},{"id":"fdcba2c9-a44f-437f-bc55-7a95ed260ba7","block_type":"box","text":"BlackRock votes on proxy issues when our clients authorize us to do so. We carefully consider the","page_number":294,"box":{"x":117,"y":511,"width":735,"height":12}},{"id":"95c6bdca-f5a8-4afc-8ed9-54e631e43b5e","block_type":"box","text":"voting items submitted to funds and other fiduciary account(s) (Fund or Funds) for which we have","page_number":294,"box":{"x":116,"y":526,"width":728,"height":12}},{"id":"4a8ca0b9-6fa8-4a44-8712-dbed0cbb028d","block_type":"box","text":"voting authority. BlackRock votes (or refrains from voting) for each Fund for which we have voting","page_number":294,"box":{"x":116,"y":542,"width":730,"height":12}},{"id":"8700d925-17d3-4ab8-8c6f-c53ffbb9fd96","block_type":"box","text":"authority based on our evaluation of the alignment of the voting items with the long-term economic","page_number":294,"box":{"x":116,"y":557,"width":734,"height":12}},{"id":"51d3068c-5f19-4957-8969-148610ff00b0","block_type":"box","text":"interests of our clients, in the exercise of our independent business judgment, and without regard to the","page_number":294,"box":{"x":117,"y":573,"width":771,"height":12}},{"id":"8a4e0228-0b29-45c0-b9b0-6c4de46dbfac","block_type":"box","text":"relationship of the issuer (or any shareholder proponent or dissident shareholder) to the Fund, the","page_number":294,"box":{"x":117,"y":588,"width":730,"height":12}},{"id":"c4a2352e-e0a9-42a6-adfe-83aded0e2a82","block_type":"box","text":"Fund’s affiliates (if any), BlackRock or BlackRock’s affiliates, or BlackRock employees (see “Conflicts","page_number":294,"box":{"x":117,"y":604,"width":754,"height":12}},{"id":"225542da-13b6-4cbd-aecc-1dbc8223ad19","block_type":"box","text":"management policies and procedures,” below).","page_number":294,"box":{"x":117,"y":619,"width":353,"height":12}},{"id":"07f22f00-1713-486b-a17a-42583c2dc49f","block_type":"box","text":"When exercising voting rights, BAIS will normally vote on specific proxy issues in accordance with the","page_number":294,"box":{"x":116,"y":648,"width":759,"height":13}},{"id":"08c0c0fa-d9c3-48e4-ac20-b6a07ad78fea","block_type":"box","text":"Guidelines, although portfolio managers have the right to vote differently on their holdings if they","page_number":294,"box":{"x":117,"y":664,"width":713,"height":12}},{"id":"142e0a53-ee46-4e77-bb4d-a1b39f4fa993","block_type":"box","text":"determine doing so is more aligned with the investment objective and financial interests of clients","page_number":294,"box":{"x":116,"y":679,"width":719,"height":13}},{"id":"cc7d3d24-44b6-4f4e-9b00-24a57afe5200","block_type":"box","text":"invested in the funds they manage.","page_number":294,"box":{"x":117,"y":695,"width":258,"height":12}},{"id":"bf4de001-b495-42b8-bfbe-79a59a7fbad0","block_type":"box","text":"The Guidelines are not intended to be exhaustive. BAIS applies the Guidelines on a case-by-case","page_number":294,"box":{"x":116,"y":724,"width":726,"height":12}},{"id":"9057ff67-9531-49c0-baa4-0a8624ac35db","block_type":"box","text":"basis, in the context of the individual circumstances of each company and the specific issue under","page_number":294,"box":{"x":117,"y":740,"width":728,"height":12}},{"id":"3d5ebbf3-5ee2-40c0-af34-17343454365b","block_type":"box","text":"review. As such, the Guidelines do not indicate how BAIS will vote in every instance. Rather, they","page_number":294,"box":{"x":117,"y":755,"width":723,"height":12}},{"id":"0edcb3db-eeea-43b8-b608-b0333f315d13","block_type":"box","text":"reflect our view about corporate governance issues generally, and provide insight into how we typically","page_number":294,"box":{"x":117,"y":771,"width":761,"height":12}},{"id":"df013878-52ed-4cdc-9546-c1f7f1cd8f46","block_type":"box","text":"approach issues that are commonly put to a shareholder vote. The Guidelines are reviewed annually","page_number":294,"box":{"x":116,"y":786,"width":747,"height":12}},{"id":"58468ab3-66d9-4708-9510-a5d53d8bf5aa","block_type":"box","text":"and updated as necessary to reflect changes in market practices, developments in corporate","page_number":294,"box":{"x":116,"y":802,"width":688,"height":12}},{"id":"9d8ce5da-aeaf-47a6-b29a-fe2f08c916b6","block_type":"box","text":"governance and feedback from companies and clients. In this way, BAIS aims to maintain policies that","page_number":294,"box":{"x":116,"y":817,"width":760,"height":12}},{"id":"dd757342-d567-477f-8482-4ffc573551b4","block_type":"box","text":"explain our approach to governance practices most aligned with clients’ long-term financial interests.","page_number":294,"box":{"x":116,"y":833,"width":751,"height":12}},{"id":"5f8c1b36-a6b3-4881-bbb5-75de9b3199fc","block_type":"box","text":"In certain markets, proxy voting involves logistical issues which can affect BAIS’ ability to vote such","page_number":294,"box":{"x":117,"y":862,"width":740,"height":12}},{"id":"aac07e8f-3528-47aa-8635-d9e22c375af6","block_type":"box","text":"proxies, as well as the desirability of voting such proxies. 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We are not supportive of impediments to the exercise of voting rights","page_number":295,"box":{"x":116,"y":165,"width":746,"height":12}},{"id":"872849c5-a5ec-4be0-aedf-cef703276d1a","block_type":"box","text":"such as share-blocking or overly burdensome administrative requirements.","page_number":295,"box":{"x":116,"y":180,"width":560,"height":12}},{"id":"423e173b-1614-4943-a6a9-127234bcd077","block_type":"box","text":"BlackRock votes proxies in these situations on a “best-efforts” basis. 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In","page_number":295,"box":{"x":116,"y":396,"width":716,"height":12}},{"id":"9a312041-382e-4e01-a0d7-dc1a243ba884","block_type":"box","text":"addition, institutional clients in separately managed accounts (SMAs) are eligible for BlackRock Voting","page_number":295,"box":{"x":116,"y":411,"width":764,"height":12}},{"id":"8045d902-4113-4b63-919c-e9bf4448e22c","block_type":"box","text":"Choice regardless of their investment strategies.","page_number":295,"box":{"x":117,"y":427,"width":357,"height":12}},{"id":"e89f9d0e-780b-4ff9-b406-2212bf8dc15b","block_type":"box","text":"12","page_number":295,"box":{"x":477,"y":427,"width":11,"height":6}},{"id":"b91c737d-c05d-4b1b-9773-f3d70f3d4b8c","block_type":"box","text":"As a result, the shares attributed to BlackRock in company share registers may be voted differently","page_number":295,"box":{"x":116,"y":457,"width":740,"height":13}},{"id":"8436267f-cd1d-43f0-a693-3ae6913af100","block_type":"box","text":"depending on whether our clients have authorized BAIS to vote on their behalf, have authorized","page_number":295,"box":{"x":116,"y":473,"width":715,"height":12}},{"id":"b651567a-aa4d-4cea-ac75-8fb64616477d","block_type":"box","text":"BlackRock to vote in accordance with a third-party policy, or have elected to vote shares in accordance","page_number":295,"box":{"x":117,"y":489,"width":769,"height":12}},{"id":"264e0009-7606-4bc0-b058-f03c989a6714","block_type":"box","text":"with their own policy. Our clients have greater control over proxy voting because of Voting Choice.","page_number":295,"box":{"x":116,"y":504,"width":727,"height":12}},{"id":"17e4ebbc-5a21-4e52-80a2-503494161d4e","block_type":"box","text":"13","page_number":295,"box":{"x":846,"y":504,"width":10,"height":6}},{"id":"3eed816c-f55d-4e78-87e7-c7b3a2faa239","block_type":"box","text":"Use and oversight of third-party vote services providers","page_number":295,"box":{"x":117,"y":535,"width":452,"height":12}},{"id":"7a57d320-036b-4fa2-b9da-699ee58be7d1","block_type":"box","text":"Third-party vote services providers – or proxy research firms – provide research and recommendations","page_number":295,"box":{"x":116,"y":565,"width":769,"height":12}},{"id":"5262614e-75fb-4006-87fd-46ce4d783977","block_type":"box","text":"on proxy votes, as well as voting infrastructure. BlackRock contracts primarily with the vote services","page_number":295,"box":{"x":116,"y":581,"width":746,"height":12}},{"id":"6b9c1452-fc17-41cf-a542-93889b34bdad","block_type":"box","text":"provider ISS and leverages its online platform to supply research and support voting, record keeping,","page_number":295,"box":{"x":117,"y":596,"width":754,"height":12}},{"id":"2bcf403b-f680-4fbc-a5c2-cf66d2dc4300","block_type":"box","text":"and reporting processes. We also use Glass Lewis’ research and analysis as an input into our voting","page_number":295,"box":{"x":116,"y":612,"width":752,"height":12}},{"id":"41332718-7aef-40f3-9a72-7eea3be1497e","block_type":"box","text":"process. It is important to note that, although proxy research firms provide important data and analysis,","page_number":295,"box":{"x":117,"y":627,"width":768,"height":12}},{"id":"b199d982-364f-435d-a10f-8ab7a4813e26","block_type":"box","text":"BAIS does not rely solely on their information or follow their voting recommendations. A company’s","page_number":295,"box":{"x":117,"y":643,"width":738,"height":12}},{"id":"608db64f-b10c-46cc-8ab0-c64b305303da","block_type":"box","text":"disclosures, our engagements and voting, investment colleagues’ insights and our Guidelines are","page_number":295,"box":{"x":116,"y":658,"width":727,"height":12}},{"id":"d1fb90d7-b4bc-4c4d-91aa-b71d72c41c5d","block_type":"box","text":"important inputs into our voting decisions on behalf of clients.","page_number":295,"box":{"x":117,"y":674,"width":452,"height":12}},{"id":"997dc983-8b19-48e9-85cb-599e56b28152","block_type":"box","text":"Given the large universe of actively held companies, BAIS employs the proxy services provider to","page_number":295,"box":{"x":117,"y":705,"width":722,"height":12}},{"id":"e26ae527-824d-432f-aadc-63f007564df3","block_type":"box","text":"streamline the voting process by making voting recommendations based on BAIS’ Guidelines when the","page_number":295,"box":{"x":116,"y":720,"width":765,"height":12}},{"id":"e95c396b-6d07-4a7e-8e74-5c9b69ba3c53","block_type":"box","text":"items on a shareholder meeting agenda are routine. Agenda items that are not routine are referred","page_number":295,"box":{"x":117,"y":736,"width":730,"height":12}},{"id":"556b9b9f-4f21-4c88-9a7b-1e61059aa381","block_type":"box","text":"back to BAIS to assess, escalate as necessary to the relevant portfolio managers and vote. BAIS","page_number":295,"box":{"x":117,"y":751,"width":719,"height":12}},{"id":"9c92b9a5-7867-41fe-b546-bda506833a1e","block_type":"box","text":"reviews and can override the recommendations of the vote services provider at any time prior to the","page_number":295,"box":{"x":117,"y":767,"width":739,"height":12}},{"id":"69be1946-67b0-454c-9d99-7d0558dba218","block_type":"box","text":"vote deadline. 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BAIS prioritizes","page_number":296,"box":{"x":150,"y":668,"width":702,"height":12}},{"id":"133f0618-e865-4ba5-a3e9-49113aca7fcc","block_type":"box","text":"engagements based on factors including, but not limited to, our need for additional information to","page_number":296,"box":{"x":150,"y":684,"width":717,"height":12}},{"id":"0791dea1-6a7a-4e86-a1d1-ca540e8ece43","block_type":"box","text":"make a more informed voting decision or to better understand a company’s perspectives on","page_number":296,"box":{"x":150,"y":699,"width":680,"height":12}},{"id":"4928d953-9b71-4e5c-b5eb-49613c818cba","block_type":"box","text":"financially material risks and opportunities. 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Through stewardship, we assess how companies","page_number":305,"box":{"x":117,"y":149,"width":745,"height":12}},{"id":"df3a59bf-7d5d-46b1-8add-d28000a16831","block_type":"box","text":"are creating long-term financial value to serve our clients, many of whom are saving for long-term","page_number":305,"box":{"x":116,"y":165,"width":728,"height":12}},{"id":"1dc2f0c7-e75b-40e6-a4e4-57b840f3b833","block_type":"box","text":"goals, such as retirement. 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As a fiduciary, BlackRock is legally required to make proxy voting","page_number":305,"box":{"x":116,"y":382,"width":663,"height":12}},{"id":"567e0cb6-51f0-43ba-80d9-2159a9f8cc6e","block_type":"box","text":"determinations in a manner that is consistent with the investment objectives of clients who have","page_number":305,"box":{"x":116,"y":397,"width":715,"height":12}},{"id":"eb8d56dc-67a4-4234-b7ea-399848f05109","block_type":"box","text":"delegated voting authority to us. BIS’ Benchmark Policies, and the vote decisions made consistent with","page_number":305,"box":{"x":116,"y":413,"width":770,"height":12}},{"id":"6503fd50-cfd0-4e84-bb67-8eb71e0aa897","block_type":"box","text":"those policies, reflect our reasonable and independent judgment of what is in the long-term financial","page_number":305,"box":{"x":116,"y":428,"width":746,"height":12}},{"id":"645d743f-b7a9-4c22-9439-ae60cf58ff30","block_type":"box","text":"interests of clients. Our vote decisions are often informed by several factors, including in-depth","page_number":305,"box":{"x":117,"y":444,"width":706,"height":12}},{"id":"3d9145a0-17e2-4f84-b4a2-229f56ae344d","block_type":"box","text":"analysis of company disclosures, comparisons against industry peers, third-party research, and, where","page_number":305,"box":{"x":116,"y":459,"width":768,"height":12}},{"id":"61c92992-686d-4376-880a-e5e3e273820d","block_type":"box","text":"appropriate, engagement with companies.","page_number":305,"box":{"x":116,"y":475,"width":318,"height":12}},{"id":"dcbd22c7-810f-4af4-9996-ccc8fc01f54e","block_type":"box","text":"Generally, BIS supports the vote recommendations of the board of directors and management at","page_number":305,"box":{"x":117,"y":506,"width":721,"height":12}},{"id":"73ee66fa-b2e6-4c02-956e-5b4b03809da3","block_type":"box","text":"companies which have sound corporate governance and deliver strong financial returns over time.","page_number":305,"box":{"x":116,"y":521,"width":734,"height":12}},{"id":"3d064491-6d7d-409f-b8a9-5f79764d5c58","block_type":"box","text":"When we determine it is in our clients’ financial interests to convey concern to companies through","page_number":305,"box":{"x":116,"y":537,"width":729,"height":12}},{"id":"25d09a36-f476-416d-bb7e-6c6e61d03170","block_type":"box","text":"voting, we may do so in two forms: we might not support the election of directors or other management","page_number":305,"box":{"x":116,"y":552,"width":768,"height":12}},{"id":"9bf0c931-3e18-474e-8634-978ea1d9f4be","block_type":"box","text":"proposals, or we might not support management’s voting recommendation on a shareholder proposal.","page_number":305,"box":{"x":117,"y":568,"width":761,"height":12}},{"id":"9cf51a8c-ae6b-490c-b7a6-182a16723d30","block_type":"box","text":"SHAREHOLDER RIGHTS","page_number":305,"box":{"x":401,"y":606,"width":202,"height":10}},{"id":"26e1751f-e07d-4522-aadb-2676df6697d8","block_type":"box","text":"BlackRock’s global approach as a shareholder on behalf of our clients is underpinned by certain rights","page_number":305,"box":{"x":117,"y":637,"width":762,"height":12}},{"id":"69a02da7-7c8d-4e06-9f48-6cf1875480ab","block_type":"box","text":"attached to shareholding in most markets, as established by corporate laws, regulations, and listing","page_number":305,"box":{"x":116,"y":653,"width":743,"height":12}},{"id":"7b9f37e6-4079-41b2-99ef-d9eada666f01","block_type":"box","text":"rules.","page_number":305,"box":{"x":117,"y":669,"width":38,"height":9}},{"id":"89973ed9-81e6-43ba-9664-644573f55954","block_type":"box","text":"3","page_number":305,"box":{"x":157,"y":669,"width":5,"height":6}},{"id":"7bf525b9-e083-4ac9-884a-886edc8da331","block_type":"box","text":"For example, in most markets, shareholders have the right to:","page_number":305,"box":{"x":169,"y":669,"width":456,"height":11}},{"id":"884cc55c-9e9e-4dde-b1e6-50cc20c935f3","block_type":"box","text":"• Vote to elect, remove, and nominate directors, approve the appointment of the auditor, and amend","page_number":305,"box":{"x":117,"y":699,"width":763,"height":12}},{"id":"e5e2c1d1-a2a8-4801-b7f7-06320b10fbc1","block_type":"box","text":"the corporate charter or bylaws.","page_number":305,"box":{"x":150,"y":715,"width":235,"height":12}},{"id":"5b477f3e-554a-4ae1-ad49-fb137d15f74d","block_type":"box","text":"• Vote on key board decisions that are material to the protection of their investment, including but","page_number":305,"box":{"x":117,"y":738,"width":742,"height":12}},{"id":"c4966238-65a7-4be7-b925-91526d153528","block_type":"box","text":"not limited to, changes to the purpose of the business, dilution levels, and pre-emptive rights.","page_number":305,"box":{"x":150,"y":754,"width":688,"height":12}},{"id":"0ae5c2b9-61ff-42b5-8bf5-8e748616ff0e","block_type":"box","text":"• Access sufficient and timely information on governance, strategic, and business matters – where","page_number":305,"box":{"x":117,"y":777,"width":750,"height":12}},{"id":"dec6ce80-c898-45e7-b3f9-2ef5663bf5af","block_type":"box","text":"such matters are material – to make informed decisions.","page_number":305,"box":{"x":150,"y":792,"width":416,"height":10}},{"id":"d4551fb4-e1ba-4229-b6e7-25f68681a2b0","block_type":"box","text":"3","page_number":305,"box":{"x":143,"y":854,"width":4,"height":5}},{"id":"9375ea06-3420-4cf3-8431-17da5bcf0a89","block_type":"box","text":"Examples include: Government of Canada, “Canada Business Corporations Act,” amended 2024; European Union,","page_number":305,"box":{"x":171,"y":854,"width":682,"height":9}},{"id":"ea8e3da8-67d1-43b2-8c6a-a75fce990158","block_type":"box","text":"“Shareholder Rights Directive II,” 2017; and the China Securities Regulatory Commission, “Code of Corporate","page_number":305,"box":{"x":170,"y":867,"width":651,"height":9}},{"id":"d67a4f25-a004-41b2-b57a-36cf9867ab4e","block_type":"box","text":"Governance for Listed Companies in China,” 2001. Websites accessed in December 2025.","page_number":305,"box":{"x":170,"y":880,"width":538,"height":9}},{"id":"d79ea285-1c03-421f-b1a4-2327ed360bbe","block_type":"box","text":"BlackRock Investment Stewardship","page_number":305,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"91a81778-1c9b-4231-a331-1bf4d0504ce4","block_type":"box","text":"Global Principles |","page_number":305,"box":{"x":731,"y":909,"width":132,"height":12}},{"id":"3665eab4-f30f-4075-9e0f-a67be63c633c","block_type":"box","text":"4","page_number":305,"box":{"x":874,"y":909,"width":9,"height":9}},{"id":"ab386ffb-8ba5-4f2a-86f8-6aae0dad10fb","block_type":"box","text":"NM1026U-6004382-305/605","page_number":305,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b9457b04-84e3-4300-adfa-18595fffb761","block_type":"box","text":"KEY GOVERNANCE TOPICS","page_number":306,"box":{"x":387,"y":87,"width":231,"height":10}},{"id":"8cba4d1f-a25c-4734-baa7-4b9cd99b9283","block_type":"box","text":"In our experience, there are certain globally applicable elements of corporate governance that","page_number":306,"box":{"x":117,"y":118,"width":700,"height":12}},{"id":"e16d75af-ec10-48da-8b38-c7126395061d","block_type":"box","text":"contribute to a company’s ability to create long-term financial value for shareholders. These are topics","page_number":306,"box":{"x":116,"y":134,"width":761,"height":12}},{"id":"512bfc9e-30ee-4824-ad31-d1d8ecb3ca86","block_type":"box","text":"that shareholders may have the ability to vote on at shareholder meetings. These areas include:","page_number":306,"box":{"x":116,"y":149,"width":717,"height":12}},{"id":"21c8b73f-e6ba-471c-8394-0a0d62f8e5c1","block_type":"box","text":"• Boards and directors","page_number":306,"box":{"x":117,"y":180,"width":192,"height":10}},{"id":"b3a971f5-fc2b-4765-9d2a-28456bc2d203","block_type":"box","text":"• Auditors and audit-related issues","page_number":306,"box":{"x":117,"y":203,"width":282,"height":10}},{"id":"75b6bbb8-6505-4570-b74a-4fa7152acc97","block_type":"box","text":"• Capital structure, mergers, acquisitions, asset sales, and other special situations","page_number":306,"box":{"x":117,"y":227,"width":635,"height":12}},{"id":"22d3da78-198f-44bf-a084-3f5dc276c32c","block_type":"box","text":"• Executive compensation","page_number":306,"box":{"x":117,"y":250,"width":219,"height":12}},{"id":"db85cacc-b3ff-4d94-986d-fed0db4690b4","block_type":"box","text":"• Shareholder protections and other significant corporate governance matters","page_number":306,"box":{"x":117,"y":273,"width":600,"height":12}},{"id":"781252c9-3d9a-4f73-a1fa-31fffd8865b9","block_type":"box","text":"• Shareholder proposals","page_number":306,"box":{"x":117,"y":296,"width":206,"height":12}},{"id":"2622f328-cb98-4705-a0d7-8010441de275","block_type":"box","text":"The BIS Benchmark Policies are not prescriptive but rather are applied on a pragmatic basis, taking","page_number":306,"box":{"x":116,"y":327,"width":744,"height":12}},{"id":"6780b86a-8b50-413d-8da5-dd716201e1e8","block_type":"box","text":"into consideration a number of company-specific factors, including the sector, market, and business","page_number":306,"box":{"x":117,"y":343,"width":744,"height":12}},{"id":"8e283d9f-43f7-4f57-9862-6e8f4f2ae065","block_type":"box","text":"environment within which companies operate.","page_number":306,"box":{"x":116,"y":358,"width":345,"height":12}},{"id":"863c17eb-16af-4be4-a0d2-55a680637c04","block_type":"box","text":"At the regional level, it is our view that companies should observe the accepted corporate governance","page_number":306,"box":{"x":116,"y":389,"width":761,"height":12}},{"id":"23b4470e-2d06-4b4f-8609-a11b8e6a73d3","block_type":"box","text":"standards in their domestic market at a minimum, and we ask that, if they do not, they explain how","page_number":306,"box":{"x":116,"y":405,"width":736,"height":12}},{"id":"1ded4cfe-165e-4bcb-a429-55c1b25ba13e","block_type":"box","text":"their approach better supports durable, long-term financial value creation. Our regional voting","page_number":306,"box":{"x":116,"y":420,"width":698,"height":12}},{"id":"56ca94be-2722-4762-9d6a-0f06276b1523","block_type":"box","text":"guidelines explain how the BIS Global Principles inform our voting decisions in relation to common","page_number":306,"box":{"x":116,"y":436,"width":735,"height":12}},{"id":"6fc2fdb1-0c3d-4a88-965e-8d9e0b2f2e99","block_type":"box","text":"ballot items for shareholder meetings in those markets.","page_number":306,"box":{"x":117,"y":451,"width":406,"height":12}},{"id":"08cfa205-b2d0-4a88-bf4e-ecae7a517cec","block_type":"box","text":"4","page_number":306,"box":{"x":525,"y":451,"width":5,"height":7}},{"id":"5551289d-82b8-4ed2-9183-b52095cf2451","block_type":"box","text":"BOARDS AND DIRECTORS","page_number":306,"box":{"x":392,"y":490,"width":221,"height":10}},{"id":"e36426c3-780b-4640-b958-019286997037","block_type":"box","text":"Oversight role of the board","page_number":306,"box":{"x":116,"y":521,"width":221,"height":12}},{"id":"b6f43ebd-f57e-4c54-ac28-ad58e5a6d6b6","block_type":"box","text":"Companies whose boards are comprised of appropriately qualified, engaged directors with","page_number":306,"box":{"x":117,"y":552,"width":676,"height":12}},{"id":"0b39ae4c-bfcb-4557-852e-bbce2d3567ce","block_type":"box","text":"professional characteristics relevant to a company’s business enhance the board’s ability to add long","page_number":306,"box":{"x":117,"y":568,"width":753,"height":12}},{"id":"1f55c309-fffd-49d1-958e-a16bbcc2129f","block_type":"box","text":"term financial value and serve as the voice of shareholders in board discussions. In our view, a strong","page_number":306,"box":{"x":116,"y":583,"width":761,"height":12}},{"id":"680f2f4e-2011-432d-be62-0938cb18c558","block_type":"box","text":"board gives a company a competitive advantage, providing valuable oversight and contributing to the","page_number":306,"box":{"x":117,"y":599,"width":754,"height":12}},{"id":"574958f5-5b36-4e13-8273-b8198fea6e1a","block_type":"box","text":"most important management decisions that support long-term financial performance.","page_number":306,"box":{"x":117,"y":614,"width":632,"height":12}},{"id":"7d95367b-bfdf-480b-8003-c6da92a9d02b","block_type":"box","text":"For this reason, our investment stewardship efforts focus on the effectiveness of the board of directors.","page_number":306,"box":{"x":117,"y":645,"width":768,"height":12}},{"id":"47c83193-df18-4376-9ca7-ca49eb40d9e8","block_type":"box","text":"We engage, as necessary, with members of the board’s nominating and/or governance committee to","page_number":306,"box":{"x":116,"y":661,"width":748,"height":12}},{"id":"3b686037-b79d-407c-b76d-a832c2f015d0","block_type":"box","text":"assess whether governance practices and board composition are effective given a company’s","page_number":306,"box":{"x":116,"y":676,"width":696,"height":12}},{"id":"d8759e9c-3467-45cd-8b8c-285075a19032","block_type":"box","text":"business model, sector, market, and the business environment in which a company is operating.","page_number":306,"box":{"x":117,"y":692,"width":713,"height":12}},{"id":"c6298daf-b49b-4dcd-a251-c05a9edb5799","block_type":"box","text":"We consider it good practice when the board establishes and maintains a framework of robust and","page_number":306,"box":{"x":116,"y":723,"width":730,"height":12}},{"id":"038570a3-c9dd-4370-858a-0a053eb64208","block_type":"box","text":"effective governance mechanisms that supports its oversight of the company’s strategy and","page_number":306,"box":{"x":116,"y":738,"width":679,"height":12}},{"id":"3367f43d-ee97-4318-8206-c7275ef81a53","block_type":"box","text":"operations, consistent with the long-term financial interests of investors. This includes having clear","page_number":306,"box":{"x":116,"y":754,"width":731,"height":12}},{"id":"6813c6aa-88bb-40a2-b4e5-f177b6655bec","block_type":"box","text":"descriptions of the role of the board and the committees of the board and how directors engage with","page_number":306,"box":{"x":116,"y":769,"width":742,"height":12}},{"id":"10c7807c-2cb3-436d-8b3b-d7d820ccf476","block_type":"box","text":"and oversee management, as well as disclosure of material risks that may affect a company’s long","page_number":306,"box":{"x":116,"y":785,"width":738,"height":12}},{"id":"22423153-c150-4d1f-a059-6674e5cb5ebc","block_type":"box","text":"term strategy and how management is effectively identifying, managing, and mitigating such risks.","page_number":306,"box":{"x":116,"y":800,"width":726,"height":12}},{"id":"b7d37d5e-1844-4b3d-925b-f6f79f71e911","block_type":"box","text":"4","page_number":306,"box":{"x":143,"y":841,"width":4,"height":5}},{"id":"3a8fbbd1-7671-4d27-9cbd-e548c4de9b82","block_type":"box","text":"Our regional voting guidelines reflect these different market standards and norms. Depending on the market, generally","page_number":306,"box":{"x":170,"y":841,"width":702,"height":9}},{"id":"c57933d3-0a2d-464d-aa76-a57142185bdf","block_type":"box","text":"accepted practice is informed by corporate law, market regulation, best practices, and industry initiatives, amongst other","page_number":306,"box":{"x":170,"y":854,"width":712,"height":9}},{"id":"6b82d47a-d289-4a28-a324-97cc8af4a147","block_type":"box","text":"factors. BIS carries out engagement with companies, executes proxy votes, and conducts vote operations (including","page_number":306,"box":{"x":170,"y":867,"width":688,"height":9}},{"id":"105ef413-beaa-457e-9d74-18ee07a810c3","block_type":"box","text":"maintaining records of votes cast) in a manner consistent with the relevant regional voting guidelines.","page_number":306,"box":{"x":170,"y":880,"width":600,"height":9}},{"id":"a616457f-d1df-44fc-97b2-de0d2760c117","block_type":"box","text":"BlackRock Investment Stewardship","page_number":306,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"3e7c0de7-1544-4891-9bf0-ee04eca1e2d1","block_type":"box","text":"Global Principles |","page_number":306,"box":{"x":731,"y":909,"width":132,"height":12}},{"id":"2aa3adc1-16a0-40f9-b7a4-a0a52c3211ef","block_type":"box","text":"5","page_number":306,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"5bc37682-a5d6-42c8-92d1-2a9a42749e1b","block_type":"box","text":"NM1026U-6004382-306/605","page_number":306,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4b450912-6e48-48b6-9d02-3be9af61cf82","block_type":"box","text":"Understanding management’s long-term strategy and the milestones against which investors should","page_number":307,"box":{"x":117,"y":87,"width":747,"height":12}},{"id":"5488950b-7211-412d-980d-00ca053c18fd","block_type":"box","text":"assess its implementation is central to our approach. If any strategic targets are significantly missed or","page_number":307,"box":{"x":116,"y":102,"width":765,"height":13}},{"id":"1c164e99-77d5-409f-a1c5-94753db118c1","block_type":"box","text":"materially restated, we find it helpful when company disclosures provide a detailed explanation of the","page_number":307,"box":{"x":117,"y":118,"width":753,"height":12}},{"id":"99e6ecb0-f27c-404c-a8be-debf51056653","block_type":"box","text":"changes and an indication of the board’s role in reviewing the revised targets. We look to the board to","page_number":307,"box":{"x":116,"y":134,"width":759,"height":12}},{"id":"51a8635e-0fd0-4174-9a78-126fdb398956","block_type":"box","text":"articulate the effectiveness of these mechanisms in overseeing the management of business risks and","page_number":307,"box":{"x":116,"y":149,"width":765,"height":12}},{"id":"0123a397-64ed-47d0-bef7-fcf84a447295","block_type":"box","text":"opportunities and the fulfillment of the company’s strategy.","page_number":307,"box":{"x":116,"y":165,"width":439,"height":12}},{"id":"b046fd48-0044-4525-be9f-ad9181bd3bcc","block_type":"box","text":"Where a company has not adequately disclosed or demonstrated that its board has fulfilled these","page_number":307,"box":{"x":116,"y":196,"width":727,"height":12}},{"id":"f3f1f486-d7d2-48ac-95a7-524b96b989b3","block_type":"box","text":"corporate governance and risk oversight responsibilities, we may consider not supporting the election","page_number":307,"box":{"x":116,"y":211,"width":757,"height":12}},{"id":"33bb010d-5a87-4270-806f-ae8782009200","block_type":"box","text":"of directors who, in our assessment, have particular responsibility for the issues.","page_number":307,"box":{"x":116,"y":227,"width":601,"height":12}},{"id":"e7a852ae-a20b-432b-9a4c-7bd3d6422403","block_type":"box","text":"When casting vote decisions on behalf of clients on the election of directors, some of the factors that","page_number":307,"box":{"x":116,"y":258,"width":750,"height":12}},{"id":"b4ea129e-1951-44f3-8a85-42277b5d0528","block_type":"box","text":"speak to the board’s effectiveness as a group include the relevance of individual directors’","page_number":307,"box":{"x":116,"y":273,"width":673,"height":12}},{"id":"27b41c07-d4cf-4125-a471-c923cd6cfe93","block_type":"box","text":"qualifications and skillsets, as well as directors’ capacity and other time commitments, and how these","page_number":307,"box":{"x":116,"y":289,"width":757,"height":12}},{"id":"13b87e29-b308-47af-8d51-7ee967c41a2c","block_type":"box","text":"factors may contribute to the company’s financial performance. We look to boards to establish formal","page_number":307,"box":{"x":116,"y":304,"width":754,"height":12}},{"id":"58278a17-682d-45d7-b198-e4a25310af98","block_type":"box","text":"and transparent processes for nominating directors that reflect the company’s long-term strategy and","page_number":307,"box":{"x":116,"y":320,"width":754,"height":12}},{"id":"8b75de0a-e2ba-4608-983f-ac2c1738087c","block_type":"box","text":"business model.","page_number":307,"box":{"x":117,"y":335,"width":125,"height":10}},{"id":"79ab3872-005b-4a03-9792-989cb2d9c370","block_type":"box","text":"In the section titled “Board quality and effectiveness” below, we provide more detail about our","page_number":307,"box":{"x":117,"y":366,"width":697,"height":12}},{"id":"50db65af-4a2d-4ee0-a37f-46acdff92f0d","block_type":"box","text":"approach to board composition and how it underpins board effectiveness and long-term financial value","page_number":307,"box":{"x":116,"y":382,"width":766,"height":12}},{"id":"43f23b7a-b593-4444-9249-b07f88e6bdf8","block_type":"box","text":"creation.","page_number":307,"box":{"x":116,"y":397,"width":69,"height":10}},{"id":"f60dfb2a-d9e7-4532-a85e-17f5bc1fe90a","block_type":"box","text":"Regular accountability through director elections","page_number":307,"box":{"x":117,"y":428,"width":397,"height":12}},{"id":"c819d375-e300-476e-8f83-8f72e15b5c01","block_type":"box","text":"The election of directors to the board is a right of shareholders and an important signal of support for,","page_number":307,"box":{"x":116,"y":459,"width":756,"height":12}},{"id":"9d521c34-2b4a-4494-9acb-0e7f1128ab5b","block_type":"box","text":"or concern about, the performance of the board in overseeing and advising management. To ensure","page_number":307,"box":{"x":116,"y":475,"width":749,"height":12}},{"id":"b87df309-b61c-462e-afb6-8490330eec15","block_type":"box","text":"accountability for their decisions on behalf of shareholders, directors should stand for election on a","page_number":307,"box":{"x":116,"y":490,"width":736,"height":12}},{"id":"44f08513-40b2-419c-b1f2-069518f76446","block_type":"box","text":"regular basis, ideally annually.","page_number":307,"box":{"x":117,"y":506,"width":223,"height":12}},{"id":"bf5cbf4b-3f63-4b27-b119-c9f71377e999","block_type":"box","text":"5","page_number":307,"box":{"x":341,"y":506,"width":6,"height":6}},{"id":"5eee796b-5a9d-4ac8-b4da-4202a782a930","block_type":"box","text":"Annual director elections allow shareholders to reaffirm their support","page_number":307,"box":{"x":347,"y":506,"width":517,"height":12}},{"id":"ee9db626-7a4d-4e6c-8950-5d566a8fea0c","block_type":"box","text":"for, or concerns about, board members’ decisions in a timely manner. When board members are not","page_number":307,"box":{"x":116,"y":521,"width":749,"height":12}},{"id":"c1024b5b-4e75-4858-92c4-85c6fac1b76a","block_type":"box","text":"elected annually, we consider it good practice for boards to have a rotation policy to ensure that,","page_number":307,"box":{"x":116,"y":537,"width":719,"height":12}},{"id":"072a6d48-163c-49d6-b5d8-742548de9dcc","block_type":"box","text":"through a board cycle, all directors have had their appointment re-confirmed, with a proportion of","page_number":307,"box":{"x":116,"y":552,"width":722,"height":12}},{"id":"38af9543-c1a4-46cb-9cdc-65bc3f2e98d4","block_type":"box","text":"directors being put forward for election at each shareholder meeting.","page_number":307,"box":{"x":116,"y":568,"width":513,"height":12}},{"id":"f9e6ec0b-9cba-4ed0-83d3-ebd2be1722cc","block_type":"box","text":"Board quality and effectiveness","page_number":307,"box":{"x":117,"y":599,"width":257,"height":12}},{"id":"3fce62e7-9e6c-439a-a8cd-096ce8c3b9c1","block_type":"box","text":"Regular director elections also give boards the opportunity to adjust their composition in an orderly way","page_number":307,"box":{"x":117,"y":630,"width":770,"height":12}},{"id":"a89ae09d-aa6e-4f66-9cea-bdce779fea2d","block_type":"box","text":"to reflect developments in the company’s strategy and the market environment. In our view, it is","page_number":307,"box":{"x":116,"y":645,"width":714,"height":12}},{"id":"bcc1cfa0-deb0-4443-9d14-05abfed1d468","block_type":"box","text":"beneficial for new directors to be brought onto the board periodically to refresh the group’s thinking,","page_number":307,"box":{"x":117,"y":661,"width":735,"height":12}},{"id":"fd192a50-cefa-4e59-bd7b-29565d05bbc3","block_type":"box","text":"while supporting both continuity and appropriate succession planning. We consider the average overall","page_number":307,"box":{"x":116,"y":676,"width":763,"height":12}},{"id":"3f946dbc-07a3-4ea8-8830-f9e9a9139fe1","block_type":"box","text":"tenure of the board and seek a balance between the knowledge and experience of longer-serving","page_number":307,"box":{"x":116,"y":692,"width":723,"height":12}},{"id":"462b1626-f1e1-4d41-aeb1-f6217da1ad18","block_type":"box","text":"directors and the fresh perspectives of directors who joined more recently.","page_number":307,"box":{"x":116,"y":707,"width":549,"height":12}},{"id":"d0f2922e-c022-4043-a774-8fda1c4be5f9","block_type":"box","text":"We appreciate when companies regularly review and assess how directors nominated for election","page_number":307,"box":{"x":116,"y":738,"width":725,"height":12}},{"id":"1d852f0b-4321-4637-93a5-106b62c5a3a4","block_type":"box","text":"contribute to the effectiveness of the board. In our view, the company’s assessment should consider a","page_number":307,"box":{"x":116,"y":754,"width":757,"height":12}},{"id":"8ea0e49a-5af3-447c-bc30-4036ed360b8d","block_type":"box","text":"number of factors, including each director’s independence and time commitments, as well as the","page_number":307,"box":{"x":117,"y":769,"width":715,"height":12}},{"id":"a856a987-7386-469d-b339-7e5e020e8b33","block_type":"box","text":"breadth and relevance of director experiences and skillsets, and how these collectively contribute to","page_number":307,"box":{"x":117,"y":785,"width":739,"height":12}},{"id":"358a6066-22dd-4abe-82a8-df35094c8007","block_type":"box","text":"the board’s effectiveness in advising and overseeing management in delivering long-term financial","page_number":307,"box":{"x":116,"y":800,"width":728,"height":12}},{"id":"064e2698-5d04-426b-8ba1-df6e4bb52cbb","block_type":"box","text":"returns.","page_number":307,"box":{"x":117,"y":816,"width":54,"height":9}},{"id":"aedfa4f3-a388-4879-a8aa-18495e5fbc2b","block_type":"box","text":"5","page_number":307,"box":{"x":143,"y":867,"width":4,"height":5}},{"id":"34edbcf3-0707-44ca-b207-4d5c786b4d9f","block_type":"box","text":"In most markets, directors stand for re-election on an annual or triennial basis, as determined by corporate law, market","page_number":307,"box":{"x":171,"y":867,"width":703,"height":9}},{"id":"3c07fa72-cecc-45c8-a136-c4def48d8741","block_type":"box","text":"regulation or voluntary best practice.","page_number":307,"box":{"x":170,"y":880,"width":215,"height":9}},{"id":"daea2f2c-3c0e-4105-b92d-f74e1cb60108","block_type":"box","text":"BlackRock Investment Stewardship","page_number":307,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"8a98592b-b934-439f-a886-4249e25d0947","block_type":"box","text":"Global Principles |","page_number":307,"box":{"x":731,"y":909,"width":132,"height":12}},{"id":"5885cb83-043a-4a27-ad04-88a0a1b9afeb","block_type":"box","text":"6","page_number":307,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"0d0749be-78a9-4519-ae0c-7e6469a6690e","block_type":"box","text":"NM1026U-6004382-307/605","page_number":307,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c3f3f43b-447c-420f-a203-af5cd020cc88","block_type":"box","text":"Director independence","page_number":308,"box":{"x":117,"y":87,"width":186,"height":12}},{"id":"0684556e-04fe-43a6-878b-59afb3e131a9","block_type":"box","text":"Director independence – from management, significant shareholders, or other related parties – is a","page_number":308,"box":{"x":117,"y":117,"width":738,"height":12}},{"id":"ffa371c9-90cc-4f4d-be06-c90ab1e7a587","block_type":"box","text":"central tenet of sound corporate governance across markets.","page_number":308,"box":{"x":116,"y":132,"width":452,"height":12}},{"id":"07673bbe-659f-4c7d-b08c-5f359c28715e","block_type":"box","text":"6","page_number":308,"box":{"x":570,"y":132,"width":5,"height":6}},{"id":"74bac521-1430-4f1e-9542-90749a9617ad","block_type":"box","text":"We look to boards to have a sufficient","page_number":308,"box":{"x":576,"y":132,"width":290,"height":10}},{"id":"0a2de778-bd4d-4ad0-b470-3b8f338eabd0","block_type":"box","text":"number of independent directors, free from conflicts of interest or undue influence, to ensure objectivity","page_number":308,"box":{"x":117,"y":148,"width":768,"height":12}},{"id":"8fa7e8bb-a9e8-4ed1-a5cf-d6d78c9dd2fb","block_type":"box","text":"in the decision-making of the board and its ability to oversee management. We generally consider it","page_number":308,"box":{"x":117,"y":163,"width":742,"height":12}},{"id":"cbf566e3-2b7a-4322-ac1f-1cde98196f8b","block_type":"box","text":"good practice for independent directors to make a majority of the board, or in the case of controlled","page_number":308,"box":{"x":116,"y":179,"width":740,"height":12}},{"id":"fe029670-4ec3-4f17-ae21-e1148e5c858f","block_type":"box","text":"companies, at least one-third.","page_number":308,"box":{"x":116,"y":194,"width":225,"height":12}},{"id":"d42d0547-0fce-4e01-9943-9cf86e5f58d9","block_type":"box","text":"Common impediments to independence may include but are not limited to:","page_number":308,"box":{"x":117,"y":224,"width":557,"height":12}},{"id":"5352704d-5d01-4bd7-bd96-d41dbcb5b0c6","block_type":"box","text":"• Current or recent employment at the company or a subsidiary","page_number":308,"box":{"x":117,"y":254,"width":495,"height":12}},{"id":"315c8e09-6154-4e54-84fc-2036c561279e","block_type":"box","text":"• Being, or representing, a shareholder with a substantial shareholding in the company","page_number":308,"box":{"x":117,"y":276,"width":668,"height":12}},{"id":"9ac8562c-8842-4944-b49f-9e73b4fbb1a6","block_type":"box","text":"• Interlocking directorates","page_number":308,"box":{"x":117,"y":299,"width":216,"height":12}},{"id":"db28462c-04e9-4c6b-9819-d11f0cbc2c86","block_type":"box","text":"• Having any other interest, business, or other relationship which could, or could reasonably be","page_number":308,"box":{"x":117,"y":322,"width":730,"height":12}},{"id":"04557c1e-4b96-4ae9-848b-debe42dde8b3","block_type":"box","text":"perceived to, materially interfere with a director’s ability to act in the best interests of the company","page_number":308,"box":{"x":150,"y":337,"width":729,"height":12}},{"id":"205de815-5893-4764-8952-dc535bc8ab5f","block_type":"box","text":"and shareholders","page_number":308,"box":{"x":150,"y":353,"width":134,"height":9}},{"id":"f9c0bd07-18cd-466b-8dc3-2307490ae087","block_type":"box","text":"In our experience, boards are most effective at overseeing and advising management when there is a","page_number":308,"box":{"x":117,"y":382,"width":759,"height":12}},{"id":"c0ba1478-89a9-4f81-ba72-77f98413b025","block_type":"box","text":"senior, independent board leader. This director may chair the board, or, where the chair is also the","page_number":308,"box":{"x":116,"y":398,"width":736,"height":12}},{"id":"34439047-5319-4113-b471-57d0dde215b1","block_type":"box","text":"CEO (or is otherwise not independent), be designated as a lead independent director. The role of this","page_number":308,"box":{"x":117,"y":413,"width":757,"height":12}},{"id":"9f96617c-d89c-4569-81db-d884cfe7e0e2","block_type":"box","text":"director is to support independent board members in fulfilling their oversight responsibilities effectively","page_number":308,"box":{"x":116,"y":429,"width":760,"height":12}},{"id":"94de22f6-5244-46bb-a3f4-c34491444b37","block_type":"box","text":"by shaping the agenda, ensuring adequate information is provided to the board, and encouraging","page_number":308,"box":{"x":117,"y":444,"width":726,"height":12}},{"id":"960344ce-0662-40c5-98cb-946be962f6a5","block_type":"box","text":"independent director participation in board deliberations. We appreciate when the lead independent","page_number":308,"box":{"x":117,"y":460,"width":742,"height":12}},{"id":"1aa9b0d3-b6fd-4d0d-bce1-cd2934b1faaa","block_type":"box","text":"director or another appropriate director is available to meet with shareholders to explain and","page_number":308,"box":{"x":116,"y":475,"width":687,"height":12}},{"id":"e5feee00-1ced-4548-8b1c-0e484e4e8133","block_type":"box","text":"contextualize a company’s approach as a situation warrants.","page_number":308,"box":{"x":116,"y":491,"width":454,"height":12}},{"id":"4704ff64-6636-41b7-a5a9-01deafefb2f9","block_type":"box","text":"Boards may face matters that could involve conflicts of interest for executives or affiliated directors, or","page_number":308,"box":{"x":117,"y":520,"width":759,"height":13}},{"id":"3444370e-b0c5-4b6c-8fcf-9a154c29ca2f","block_type":"box","text":"that require additional focus. It is our view that objective oversight of such matters is best achieved","page_number":308,"box":{"x":116,"y":536,"width":736,"height":12}},{"id":"37bc13a2-7d91-4404-bf83-95c752794dd8","block_type":"box","text":"when the board forms committees with a majority of independent directors, depending on market","page_number":308,"box":{"x":116,"y":551,"width":723,"height":13}},{"id":"a9848636-c9ef-43b6-8af4-8f9660490c66","block_type":"box","text":"norms and a company’s ownership structure. In many markets, these committees of the board","page_number":308,"box":{"x":117,"y":567,"width":704,"height":12}},{"id":"edf1a5a9-5a33-4833-9d15-b3839448d2f3","block_type":"box","text":"specialize in audit, director nominations, and compensation matters, among others. An ad hoc","page_number":308,"box":{"x":116,"y":583,"width":703,"height":12}},{"id":"c8bebb0c-b837-4309-b956-e7cda70894fa","block_type":"box","text":"committee might also be formed to decide on a special transaction, particularly one involving a related","page_number":308,"box":{"x":116,"y":598,"width":762,"height":12}},{"id":"dc6a8314-2885-4a8a-bb69-90ffd844ca22","block_type":"box","text":"party, or to investigate a significant adverse event.","page_number":308,"box":{"x":117,"y":613,"width":378,"height":13}},{"id":"a90e6f4c-88bf-43ee-8df1-99798600ee48","block_type":"box","text":"Sufficient capacity","page_number":308,"box":{"x":116,"y":643,"width":153,"height":12}},{"id":"7650b603-baaa-4bbc-82e3-6c89ea2e9c1c","block_type":"box","text":"As the role and expectations of a director are increasingly demanding, directors must be able to","page_number":308,"box":{"x":116,"y":673,"width":709,"height":12}},{"id":"d208b9ef-609e-4cf1-8684-86d243fca91d","block_type":"box","text":"commit an appropriate amount of time to board and committee matters. It is important that directors","page_number":308,"box":{"x":116,"y":688,"width":738,"height":12}},{"id":"d7aca3ad-099e-409e-b51f-437e83c16ee8","block_type":"box","text":"have the capacity to meet all of their responsibilities – including when there are unforeseen events –","page_number":308,"box":{"x":117,"y":704,"width":743,"height":12}},{"id":"89a74d86-a51c-40d6-8b59-c32b72aeafa3","block_type":"box","text":"and therefore, we consider it best practice when they don’t take on an excessive number of roles that","page_number":308,"box":{"x":116,"y":719,"width":751,"height":13}},{"id":"0784e675-7ac2-4ff0-9552-f7222cdc2eb1","block_type":"box","text":"would impair their ability to fulfill their duties.","page_number":308,"box":{"x":116,"y":735,"width":326,"height":12}},{"id":"b9660455-62c0-49f4-8c0d-f2b5789f1d49","block_type":"box","text":"Board composition","page_number":308,"box":{"x":117,"y":765,"width":151,"height":12}},{"id":"637b8696-9ad7-48c4-b3f3-1f488a645759","block_type":"box","text":"In assessing board composition, we take into account a company’s board size, business model,","page_number":308,"box":{"x":117,"y":795,"width":708,"height":11}},{"id":"775b08dd-d0ec-4755-8e0b-0440cdf9e25a","block_type":"box","text":"strategy, market capitalization, and ownership structure, as well as the market in which the company","page_number":308,"box":{"x":116,"y":810,"width":745,"height":12}},{"id":"63c951f5-33ef-47ea-96d4-2091e8703b17","block_type":"box","text":"operates. We find it helpful when companies explain how their approach to board composition supports","page_number":308,"box":{"x":116,"y":825,"width":771,"height":12}},{"id":"c8a1e47a-469c-4061-9c34-001b71e9b491","block_type":"box","text":"the company’s governance practices.","page_number":308,"box":{"x":116,"y":841,"width":282,"height":12}},{"id":"7f2c3879-6c1a-4416-914e-e346bf66b79f","block_type":"box","text":"6","page_number":308,"box":{"x":143,"y":866,"width":4,"height":5}},{"id":"52e010e1-8838-46a3-b59e-99494e0e04b0","block_type":"box","text":"For example, please see: Tokyo Stock Exchange, “Japan’s Corporate Governance Code,” June 11, 2021; Financial","page_number":308,"box":{"x":171,"y":866,"width":683,"height":10}},{"id":"b25d7575-bc46-4f1d-8eda-e742998661fb","block_type":"box","text":"Reporting Council, “UK Corporate Governance Code,” January 2024, accessed in December 2025.","page_number":308,"box":{"x":171,"y":879,"width":587,"height":10}},{"id":"3a78e594-aef5-4003-b931-c403aa4e5bf9","block_type":"box","text":"BlackRock Investment Stewardship","page_number":308,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"299ca5bd-4638-42f0-872d-72e83a925d13","block_type":"box","text":"Global Principles |","page_number":308,"box":{"x":731,"y":909,"width":132,"height":12}},{"id":"76f599be-ffc6-4502-bbc9-2982b7bc13a4","block_type":"box","text":"7","page_number":308,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"4cc8651f-ed01-4427-a223-8517492e284f","block_type":"box","text":"NM1026U-6004382-308/605","page_number":308,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5b3be4e2-16f7-41d6-ad45-9805141bf2ac","block_type":"box","text":"When nominating directors to the board, we look to companies to provide sufficient information on the","page_number":309,"box":{"x":116,"y":87,"width":760,"height":12}},{"id":"f64e1d78-48f1-49d1-93b2-c20de6f92a52","block_type":"box","text":"individual candidates so that shareholders can assess the capabilities and suitability of each individual","page_number":309,"box":{"x":117,"y":102,"width":763,"height":13}},{"id":"ae8c2a09-4597-4bbf-9016-a00364726bc3","block_type":"box","text":"nominee and their fit within overall board composition. These disclosures should explain how the","page_number":309,"box":{"x":117,"y":118,"width":721,"height":12}},{"id":"a6f8fc29-9531-4221-9d98-ed768464a58a","block_type":"box","text":"collective experience and expertise of the board, as well as the particular skillsets of individual","page_number":309,"box":{"x":116,"y":134,"width":703,"height":11}},{"id":"eea348e5-5f70-4dc7-a150-d3e8c66768cf","block_type":"box","text":"directors, aligns with the company’s long-term strategy. Highly qualified, engaged directors with","page_number":309,"box":{"x":116,"y":149,"width":713,"height":12}},{"id":"44cb764f-bd70-497c-9f32-ba74484d71b3","block_type":"box","text":"professional characteristics relevant to a company’s business and strategy enhance the ability of the","page_number":309,"box":{"x":117,"y":165,"width":749,"height":12}},{"id":"f1b1c6c7-16fd-4935-a08f-ba487888e77a","block_type":"box","text":"board to add value and be the voice of shareholders in board discussions.","page_number":309,"box":{"x":117,"y":180,"width":554,"height":10}},{"id":"6f207e3e-e7a9-40bc-af66-9069c5eebacc","block_type":"box","text":"It is in this context that we are interested in a variety of experiences, perspectives, and skillsets in the","page_number":309,"box":{"x":117,"y":208,"width":755,"height":12}},{"id":"d749f258-4936-4c5c-a509-8ef34be13022","block_type":"box","text":"board room. We see it as a means of avoiding “group think” in the board’s exercise of its","page_number":309,"box":{"x":117,"y":224,"width":659,"height":12}},{"id":"0e9a80ad-37f8-4da4-9aa4-a117538203b4","block_type":"box","text":"responsibilities to advise and oversee management. We note that in many markets, policymakers have","page_number":309,"box":{"x":117,"y":239,"width":768,"height":12}},{"id":"89645188-88c8-4f24-98c2-2dd48b34331e","block_type":"box","text":"set board gender diversity goals which we may discuss with companies, particularly if there is a risk","page_number":309,"box":{"x":116,"y":255,"width":743,"height":12}},{"id":"08857ece-5a9e-4b3a-a8e6-9b6cea567443","block_type":"box","text":"their board composition may be misaligned.","page_number":309,"box":{"x":116,"y":270,"width":329,"height":12}},{"id":"916f7585-ce00-44e1-af00-f875a1aec016","block_type":"box","text":"AUDITORS AND AUDIT-RELATED ISSUES","page_number":309,"box":{"x":331,"y":305,"width":341,"height":9}},{"id":"a0d5cf3a-76da-4b0d-bdef-2195f9e29fdc","block_type":"box","text":"BIS recognizes the critical importance of financial statements to provide a complete and accurate","page_number":309,"box":{"x":117,"y":333,"width":725,"height":12}},{"id":"5f4b7db0-f86c-45b1-9721-674a69e46a3f","block_type":"box","text":"portrayal of a company’s financial condition. Accordingly, we look for the assumptions made by","page_number":309,"box":{"x":117,"y":349,"width":709,"height":12}},{"id":"2ad2b0b7-70b1-40a2-b19a-ac78340d385e","block_type":"box","text":"management, and reviewed by the auditor in preparing the financial statements, to be reasonable and","page_number":309,"box":{"x":117,"y":364,"width":760,"height":12}},{"id":"de10f390-819c-49fa-bfd4-0d2a28b98a73","block_type":"box","text":"justified.","page_number":309,"box":{"x":115,"y":380,"width":67,"height":12}},{"id":"78432ca2-b5e5-44c5-b709-708a7885e133","block_type":"box","text":"We view the audit committee, or its equivalent, as responsible for overseeing the management of the","page_number":309,"box":{"x":116,"y":408,"width":754,"height":12}},{"id":"9773c9cb-7488-4577-8f1c-79bb5225f218","block_type":"box","text":"independent auditor and the internal audit function at a company. The committee plays an important","page_number":309,"box":{"x":117,"y":423,"width":746,"height":12}},{"id":"8e5b758f-9d43-4f37-b366-707058a5fe5c","block_type":"box","text":"role in a company’s financial reporting system by providing independent oversight of the accounts,","page_number":309,"box":{"x":117,"y":439,"width":733,"height":12}},{"id":"c5d24238-64c4-4f7d-9f7c-7094ab41434f","block_type":"box","text":"material financial, and, where appropriate to the jurisdiction, non-financial information and internal","page_number":309,"box":{"x":117,"y":454,"width":728,"height":12}},{"id":"d34964f8-d841-4bb2-a964-df0f6feb66ea","block_type":"box","text":"control frameworks. Moreover, in the absence of a dedicated risk committee, these committees can","page_number":309,"box":{"x":116,"y":470,"width":743,"height":11}},{"id":"df14dae5-aeee-463d-b6e5-5f16d99586bc","block_type":"box","text":"provide oversight of Enterprise Risk Management systems.","page_number":309,"box":{"x":117,"y":485,"width":437,"height":12}},{"id":"b3931a30-7713-4c67-bba9-947b99f4c7f5","block_type":"box","text":"7","page_number":309,"box":{"x":556,"y":486,"width":5,"height":5}},{"id":"01ce9c64-7de4-4894-bbdf-0d56345238db","block_type":"box","text":"In our view, effective audit committee","page_number":309,"box":{"x":562,"y":485,"width":286,"height":12}},{"id":"aa83c79f-3f21-48ab-b805-2db05ad2d69e","block_type":"box","text":"oversight strengthens the quality and reliability of a company’s financial statements and provides an","page_number":309,"box":{"x":116,"y":501,"width":745,"height":12}},{"id":"f7ffb59a-94e4-4333-a222-e1fc1064fd67","block_type":"box","text":"important level of reassurance to shareholders.","page_number":309,"box":{"x":117,"y":516,"width":354,"height":12}},{"id":"1cfdc9d2-2263-43d7-8313-c4890a112c86","block_type":"box","text":"We look to audit committees, or their equivalent, to have clearly articulated charters that set out their","page_number":309,"box":{"x":116,"y":545,"width":750,"height":12}},{"id":"ade7bfbe-d123-4afb-8690-cbba317ff5a1","block_type":"box","text":"responsibilities. Additionally, having a rotation plan can periodically refresh the committee membership","page_number":309,"box":{"x":117,"y":560,"width":765,"height":12}},{"id":"ae983858-6465-4e6e-94a9-0b090d0e6035","block_type":"box","text":"and introduce new perspectives. We recognize that audit committees will rely on management, internal","page_number":309,"box":{"x":116,"y":576,"width":769,"height":12}},{"id":"d7487211-7725-4603-94bd-50a2f34569c4","block_type":"box","text":"audit, and the independent auditor to fulfill their responsibilities. However, we look to committee","page_number":309,"box":{"x":116,"y":591,"width":712,"height":12}},{"id":"94cdde2c-dbc4-4bba-9175-2cf30deddf84","block_type":"box","text":"members to demonstrate they have relevant expertise to monitor and oversee the audit process and","page_number":309,"box":{"x":117,"y":607,"width":749,"height":12}},{"id":"efc7b11a-2ea6-4a56-95c7-3e9dcefbef59","block_type":"box","text":"related activities.","page_number":309,"box":{"x":117,"y":622,"width":129,"height":10}},{"id":"7d4e9da7-5fc5-472a-a067-282e468b7700","block_type":"box","text":"We take particular note of unexplained changes in reporting methodology, cases involving significant","page_number":309,"box":{"x":116,"y":650,"width":753,"height":12}},{"id":"3d6aeb54-e6d9-4084-bf3d-10e33ece562a","block_type":"box","text":"financial restatements, or ad hoc notifications of material financial weakness. In this respect, we look to","page_number":309,"box":{"x":116,"y":666,"width":765,"height":12}},{"id":"c155b682-375f-4069-9d40-282bd8940a6a","block_type":"box","text":"audit committees to provide timely disclosure on the remediation of key and critical audit matters","page_number":309,"box":{"x":116,"y":681,"width":715,"height":12}},{"id":"c99cba5e-e845-4bd0-a4b1-b31337bba12a","block_type":"box","text":"identified either by the external auditor or internal audit function.","page_number":309,"box":{"x":117,"y":697,"width":472,"height":12}},{"id":"c80ed7f3-57d4-49b8-8c05-b1d6dc3d1158","block_type":"box","text":"The integrity of financial statements depends on the auditor being free of any impediments that could","page_number":309,"box":{"x":116,"y":725,"width":748,"height":12}},{"id":"f49a6860-7990-45ea-8f33-8f678551cd11","block_type":"box","text":"compromise its ability to serve as an effective check on management. To that end, it is important that","page_number":309,"box":{"x":116,"y":741,"width":750,"height":12}},{"id":"39c0bf84-617e-4f86-9cbe-210e7d291cc4","block_type":"box","text":"auditors are, and are seen to be, independent. Where an audit firm provides services to the company","page_number":309,"box":{"x":116,"y":756,"width":751,"height":12}},{"id":"67350cd7-2321-4845-b161-28bf180e86bc","block_type":"box","text":"in addition to the audit, we look for the fees","page_number":309,"box":{"x":117,"y":772,"width":318,"height":11}},{"id":"ccac0dd2-bd7f-405d-a5cd-785315cacbf4","block_type":"box","text":"earned to be disclosed and explained. We look for audit","page_number":309,"box":{"x":441,"y":772,"width":414,"height":12}},{"id":"8336371b-1c6b-4646-b4cc-c695c28bc87b","block_type":"box","text":"committees to have in place a procedure for assessing the independence of the auditor and the quality","page_number":309,"box":{"x":116,"y":787,"width":762,"height":12}},{"id":"40ca5b99-ba86-495d-bfac-d5fa993b07cd","block_type":"box","text":"of the external audit process on an annual basis.","page_number":309,"box":{"x":116,"y":803,"width":360,"height":12}},{"id":"76d7aef0-6365-4767-84b3-42cad52f07d0","block_type":"box","text":"7","page_number":309,"box":{"x":143,"y":828,"width":4,"height":5}},{"id":"57bd0c29-8e05-4a87-a87c-51ec184af583","block_type":"box","text":"Enterprise Risk Management is a process, effected by the entity’s board of directors, management, and other","page_number":309,"box":{"x":171,"y":828,"width":648,"height":9}},{"id":"d72d4275-c4af-492c-a851-f63130c0dd81","block_type":"box","text":"personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect the","page_number":309,"box":{"x":170,"y":841,"width":709,"height":9}},{"id":"108f054d-02d6-4715-946c-94aafd7bbf1f","block_type":"box","text":"entity, and manage risk to be within the risk appetite, to provide reasonable assurance regarding the achievement of","page_number":309,"box":{"x":170,"y":854,"width":690,"height":9}},{"id":"d212f863-a647-4d17-aca0-dcce1d3a90e2","block_type":"box","text":"objectives. Please see: The Committee of Sponsoring Organizations of the Treadway Commission (COSO), “Enterprise","page_number":309,"box":{"x":170,"y":866,"width":710,"height":10}},{"id":"20d65b49-63fd-46a8-901d-a951ad333b56","block_type":"box","text":"Risk Management,” 2023, accessed in December 2025.","page_number":309,"box":{"x":171,"y":879,"width":329,"height":10}},{"id":"b0baad62-fc73-4220-8b2a-83d76ba2660e","block_type":"box","text":"BlackRock Investment Stewardship","page_number":309,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"dc051a14-1342-4028-9c5d-eba841664fb7","block_type":"box","text":"Global Principles |","page_number":309,"box":{"x":731,"y":909,"width":132,"height":12}},{"id":"5db2ee30-672b-449b-a544-cfe113ef5870","block_type":"box","text":"8","page_number":309,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"f85033c6-6714-422c-b0e4-55e8faff6da0","block_type":"box","text":"NM1026U-6004382-309/605","page_number":309,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6c25fd58-5d0f-4768-8a07-23a370738c67","block_type":"box","text":"Comprehensive disclosure provides investors with an understanding of the company’s long-term","page_number":310,"box":{"x":117,"y":87,"width":719,"height":12}},{"id":"14b80a52-21de-4999-8960-e4620c1a9cc2","block_type":"box","text":"operational risk management practices and, more broadly, the quality of the board’s oversight. We look","page_number":310,"box":{"x":116,"y":102,"width":770,"height":13}},{"id":"0aecbafc-7de6-4cac-8083-403250780355","block_type":"box","text":"to the audit or risk committee to periodically review the company’s risk assessment and risk","page_number":310,"box":{"x":116,"y":118,"width":684,"height":12}},{"id":"093f4ef0-b43d-4296-82e4-1a8c6e69f66a","block_type":"box","text":"management policies and the significant risks and exposures identified by management, the internal","page_number":310,"box":{"x":117,"y":134,"width":747,"height":12}},{"id":"938a0a33-f5d8-4596-a381-7a00689c3748","block_type":"box","text":"auditors or the independent auditors, and management’s steps to address them. In the absence of","page_number":310,"box":{"x":116,"y":149,"width":735,"height":12}},{"id":"0a083e98-4e68-4511-8195-fc4632bf5b17","block_type":"box","text":"detailed disclosures, we may conclude that companies are not adequately managing risk.","page_number":310,"box":{"x":116,"y":165,"width":668,"height":12}},{"id":"4cea4325-5d57-4665-921f-f19151205108","block_type":"box","text":"CAPITAL STRUCTURE, MERGERS, ACQUISITIONS, ASSET SALES, AND OTHER SPECIAL","page_number":310,"box":{"x":141,"y":203,"width":723,"height":12}},{"id":"4edeba5a-c9ea-438d-8590-774b6468126b","block_type":"box","text":"SITUATIONS","page_number":310,"box":{"x":449,"y":219,"width":106,"height":9}},{"id":"b4604461-29d7-4145-adbc-644da669915b","block_type":"box","text":"The capital structure of a company is critical to shareholders as it impacts the value of their investment","page_number":310,"box":{"x":116,"y":250,"width":766,"height":12}},{"id":"cf45f9c7-5642-400a-8a78-763f1f042685","block_type":"box","text":"and the priority of their interest in the company relative to that of other equity or debt investors.","page_number":310,"box":{"x":116,"y":265,"width":707,"height":12}},{"id":"77f6c23e-3e7d-475a-9b02-0f0ef1b0939d","block_type":"box","text":"Pre-emptive rights are a key protection for shareholders against the dilution of their interests.","page_number":310,"box":{"x":117,"y":281,"width":693,"height":12}},{"id":"cc098714-9093-417c-8ea2-cf5678a35d4d","block_type":"box","text":"In principle, we have concerns with the creation of a share class with equivalent economic exposure","page_number":310,"box":{"x":117,"y":312,"width":746,"height":12}},{"id":"61483a71-a6f5-4b08-a99e-8b4dcd6d81b2","block_type":"box","text":"and differentiated voting rights. As a result, BIS generally supports bylaw amendments that introduce","page_number":310,"box":{"x":116,"y":327,"width":754,"height":12}},{"id":"f782ab92-a949-41dd-a825-757787fb43c6","block_type":"box","text":"the adoption of “one share, one vote” for registered shareholders.","page_number":310,"box":{"x":116,"y":343,"width":491,"height":12}},{"id":"f144b890-4bda-4e24-9144-997749207d18","block_type":"box","text":"However, we recognize that in certain markets, at least for a period of time, companies may have a","page_number":310,"box":{"x":117,"y":374,"width":740,"height":12}},{"id":"75dab99a-2b7a-4b37-a63e-142a403c5f99","block_type":"box","text":"valid reason for listing dual classes of shares with differentiated voting rights. In our view, such","page_number":310,"box":{"x":116,"y":389,"width":706,"height":12}},{"id":"ed983be8-2537-4e76-98e3-01d3b0ca9499","block_type":"box","text":"companies should review these share class structures on a regular basis or as company","page_number":310,"box":{"x":116,"y":405,"width":661,"height":12}},{"id":"eb28458c-0cf3-46bb-9c26-f577e5e8147a","block_type":"box","text":"circumstances change. Additionally, they should seek shareholder approval of their capital structure on","page_number":310,"box":{"x":116,"y":420,"width":769,"height":12}},{"id":"f457c2ee-4ae8-4ce6-a3b6-80eb82e6e304","block_type":"box","text":"a periodic basis via a management proposal at the company’s shareholder meeting. The proposal","page_number":310,"box":{"x":116,"y":436,"width":731,"height":12}},{"id":"9f593e44-7f0f-44ce-b487-47ab1c1304d3","block_type":"box","text":"should give unaffiliated shareholders the opportunity to affirm the current structure or establish","page_number":310,"box":{"x":116,"y":451,"width":705,"height":12}},{"id":"945087a2-b963-44f8-91a9-12c18176101b","block_type":"box","text":"mechanisms to end or phase out controlling structures at the appropriate time, while minimizing costs","page_number":310,"box":{"x":117,"y":467,"width":757,"height":12}},{"id":"cdd0b595-b2a8-4cec-9443-7c192ea30381","block_type":"box","text":"to shareholders.","page_number":310,"box":{"x":116,"y":482,"width":125,"height":10}},{"id":"8fbb214a-6271-4650-8b8e-73abecd79377","block_type":"box","text":"In assessing mergers, asset sales, or other special situations, BIS’ primary consideration is the long","page_number":310,"box":{"x":117,"y":513,"width":745,"height":12}},{"id":"99a994b8-e383-48c3-8ff6-0cf9e1724f65","block_type":"box","text":"term financial interests of our clients as shareholders, and so we will review any proposed transaction","page_number":310,"box":{"x":116,"y":529,"width":758,"height":12}},{"id":"138e5c5e-2f99-47f8-a3af-4f7bc98f5ad9","block_type":"box","text":"with that objective in mind. Typically, we review factors such as whether the proposed transaction has","page_number":310,"box":{"x":116,"y":544,"width":760,"height":12}},{"id":"14cdcaaa-659f-49de-9242-f157d6f1574d","block_type":"box","text":"the unanimous support of the board and has been negotiated at arm’s length, and whether the board","page_number":310,"box":{"x":116,"y":560,"width":753,"height":12}},{"id":"18a2ccfd-40f3-40f1-a645-e53ee2721dd0","block_type":"box","text":"or management has clearly explained its economic and strategic rationale. We may also seek","page_number":310,"box":{"x":116,"y":576,"width":699,"height":11}},{"id":"88e641a2-8ce7-421d-9666-c401e371f62f","block_type":"box","text":"reassurance from the board that the financial interests of executives and/or board members in a given","page_number":310,"box":{"x":117,"y":591,"width":761,"height":12}},{"id":"190c7ed3-4668-4c2d-9a10-d4823af8be06","block_type":"box","text":"transaction have not adversely affected their ability to place shareholders’ interests before their own.","page_number":310,"box":{"x":116,"y":606,"width":750,"height":12}},{"id":"0495f615-6363-4acd-9a7c-17b3603fbdca","block_type":"box","text":"Where the transaction involves related parties, the recommendation to support should come from the","page_number":310,"box":{"x":116,"y":622,"width":755,"height":12}},{"id":"7c796214-0afe-46b7-9542-bfec1ed53576","block_type":"box","text":"independent directors, a best practice in most markets, and ideally, the terms should have been","page_number":310,"box":{"x":117,"y":638,"width":715,"height":11}},{"id":"ba910790-6376-469f-bb7b-6fa4d7008205","block_type":"box","text":"assessed through an independent appraisal process. In addition, it is good practice that it be approved","page_number":310,"box":{"x":116,"y":653,"width":766,"height":12}},{"id":"243bb16d-d1e8-42ee-b63a-1263d70e729b","block_type":"box","text":"by a separate vote of the non-conflicted parties.","page_number":310,"box":{"x":117,"y":668,"width":352,"height":12}},{"id":"c20932f2-e37c-4e8b-bada-e454eacbde22","block_type":"box","text":"As a matter of sound governance practice, shareholders should have a right to dispose of company","page_number":310,"box":{"x":116,"y":699,"width":738,"height":13}},{"id":"780f32c2-200e-4bc9-b012-49cde2fe94b8","block_type":"box","text":"shares in the open market without unnecessary restriction. In our view, corporate mechanisms","page_number":310,"box":{"x":116,"y":715,"width":700,"height":12}},{"id":"45b1c286-aaaf-4563-9366-51bd078be6fa","block_type":"box","text":"designed to limit shareholders’ ability to sell their shares are contrary to basic property rights. Such","page_number":310,"box":{"x":116,"y":730,"width":732,"height":13}},{"id":"848ee70f-cd6c-4a9f-8cec-dba3b5880e7b","block_type":"box","text":"mechanisms can serve to protect and entrench interests other than those of the shareholders. In our","page_number":310,"box":{"x":117,"y":746,"width":745,"height":12}},{"id":"4bd033a5-f622-41a4-96ee-02148859ab74","block_type":"box","text":"view, shareholders are broadly capable of making decisions in their own best interests. We encourage","page_number":310,"box":{"x":116,"y":761,"width":759,"height":13}},{"id":"dc59d62c-1498-413e-8196-48e4fa83cb73","block_type":"box","text":"any shareholder rights plans proposed by a board to be subject to shareholder approval upon","page_number":310,"box":{"x":116,"y":777,"width":693,"height":12}},{"id":"f3d22922-3ab8-4a5f-a286-c9fd0491beeb","block_type":"box","text":"introduction and periodically thereafter.","page_number":310,"box":{"x":117,"y":792,"width":287,"height":13}},{"id":"bf6c2be9-623d-4d16-8b28-dc43fb1c6df7","block_type":"box","text":"EXECUTIVE COMPENSATION AND BENEFITS","page_number":310,"box":{"x":318,"y":831,"width":369,"height":10}},{"id":"a18607c3-729e-46fa-b9c7-32e5d5a1e1d4","block_type":"box","text":"Executive compensation is an important tool used by companies to support long-term financial value","page_number":310,"box":{"x":117,"y":862,"width":749,"height":12}},{"id":"48bbc9ce-997f-4ee4-be6b-a4e36ca7945a","block_type":"box","text":"creation. A well-structured compensation policy rewards the successful delivery of strategic,","page_number":310,"box":{"x":116,"y":878,"width":686,"height":12}},{"id":"d9cc0906-8348-4276-847d-0b27ae40e153","block_type":"box","text":"BlackRock Investment Stewardship","page_number":310,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"69086bc6-9ecc-427a-818c-b7f4960f3a43","block_type":"box","text":"Global Principles |","page_number":310,"box":{"x":731,"y":909,"width":132,"height":12}},{"id":"04b3515f-1b71-4aab-a1fb-e9e2a175113b","block_type":"box","text":"9","page_number":310,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"84a5be12-efd4-4c2f-8750-0ebec08b271b","block_type":"box","text":"NM1026U-6004382-310/605","page_number":310,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"74f78b70-4fcc-40ec-99e8-3c82b129cba9","block_type":"box","text":"operational, and/or financial goals; encourages an appropriate risk appetite; and aligns the interests of","page_number":311,"box":{"x":116,"y":87,"width":763,"height":12}},{"id":"023b1b1f-de5e-46d8-a808-fc12c9903f7c","block_type":"box","text":"shareholders and executives through equity ownership.","page_number":311,"box":{"x":116,"y":103,"width":410,"height":12}},{"id":"696b85a1-75c6-4d12-b502-f549f9128b2a","block_type":"box","text":"8","page_number":311,"box":{"x":528,"y":103,"width":5,"height":6}},{"id":"5e3223f6-27a9-4069-80d2-4295fdc36173","block_type":"box","text":"We look for a clear link between variable pay and operational and financial performance that support","page_number":311,"box":{"x":116,"y":134,"width":751,"height":12}},{"id":"e5fe0775-d2ce-4f02-9e52-c15b27183f95","block_type":"box","text":"sustained financial value creation for our clients as shareholders. We appreciate when performance","page_number":311,"box":{"x":116,"y":149,"width":744,"height":12}},{"id":"33a98c5a-0670-48d5-9d29-82e4b6b8e8c4","block_type":"box","text":"targets incorporate ambitious objectives, and the corresponding metrics are aligned with the","page_number":311,"box":{"x":116,"y":165,"width":687,"height":12}},{"id":"ec09f530-5ba3-4b1a-94f8-df5028fbfc79","block_type":"box","text":"company’s strategy and business model. BIS does not have a position on whether companies choose","page_number":311,"box":{"x":116,"y":180,"width":760,"height":12}},{"id":"84482693-3bdf-497e-b3de-ae354a727d70","block_type":"box","text":"to use sustainability-related criteria in compensation structures, but, where they are included, we look","page_number":311,"box":{"x":116,"y":196,"width":757,"height":12}},{"id":"5caa0c67-2023-4db4-8ca5-af8192467c73","block_type":"box","text":"to companies to be as rigorous as they would be in setting other financial or operational targets. We","page_number":311,"box":{"x":116,"y":211,"width":745,"height":12}},{"id":"e7a6362d-bfe7-45fc-8b02-8bc5128608da","block_type":"box","text":"appreciate when long-term incentive plans encompass timeframes that: 1) are distinct from annual","page_number":311,"box":{"x":116,"y":227,"width":735,"height":12}},{"id":"f402fbcd-570f-4458-aad5-1f14987997ef","block_type":"box","text":"executive compensation structures and metrics, and 2) encourage the delivery of strong financial","page_number":311,"box":{"x":116,"y":242,"width":724,"height":12}},{"id":"c7575313-ef51-49c2-8325-ea75f5aebe52","block_type":"box","text":"results over a period of years.","page_number":311,"box":{"x":117,"y":258,"width":225,"height":12}},{"id":"42813e09-e13c-4973-bf62-90bce36edaed","block_type":"box","text":"We consider it best practice when board members responsible for designing and approving executive","page_number":311,"box":{"x":116,"y":289,"width":757,"height":12}},{"id":"aada377b-a19b-4c2a-90e7-65d85dfbafc4","block_type":"box","text":"compensation carefully consider the company’s specific circumstances. Factors to consider may","page_number":311,"box":{"x":116,"y":304,"width":720,"height":12}},{"id":"adf842dd-8e7c-4905-9817-82421969d734","block_type":"box","text":"include the company’s risk profile, the environment it operates in, and the individuals the board is trying","page_number":311,"box":{"x":117,"y":320,"width":770,"height":12}},{"id":"c785854c-e9ae-465d-863e-4e80557f912c","block_type":"box","text":"to attract and retain. We look to the compensation committees to guard against contractual","page_number":311,"box":{"x":116,"y":335,"width":679,"height":12}},{"id":"24ca6259-434c-4057-a5a4-a4151936f141","block_type":"box","text":"arrangements that would entitle executives to material compensation for early termination of their","page_number":311,"box":{"x":116,"y":351,"width":726,"height":12}},{"id":"e21736db-86a9-46ca-a483-16468c686fc3","block_type":"box","text":"employment. Finally, we look for pension contributions and other deferred compensation arrangements","page_number":311,"box":{"x":116,"y":366,"width":770,"height":12}},{"id":"bc42f8c4-58af-490c-b89f-55e9bc2c6af1","block_type":"box","text":"to be reasonable in light of market practices or the company’s business and executive compensation","page_number":311,"box":{"x":116,"y":382,"width":752,"height":12}},{"id":"f50f247f-c143-45ad-8137-2a2ec961188e","block_type":"box","text":"strategies.","page_number":311,"box":{"x":116,"y":397,"width":82,"height":12}},{"id":"43f5ac03-7ab3-42b3-aecb-a7998298d35e","block_type":"box","text":"We are not supportive of one-off or special bonuses unrelated to company or individual performance.","page_number":311,"box":{"x":116,"y":428,"width":755,"height":12}},{"id":"e757e39d-fe6e-46f9-b300-acf8c764715a","block_type":"box","text":"Where discretion has been used by the compensation committee, or its equivalent, we appreciate","page_number":311,"box":{"x":116,"y":444,"width":730,"height":12}},{"id":"09bfaeff-e955-4557-a95b-049f37e5e7cf","block_type":"box","text":"disclosure relating to how and why the discretion was used, and how the adjusted outcome is aligned","page_number":311,"box":{"x":116,"y":459,"width":757,"height":12}},{"id":"ba7cf047-723b-4b7e-a397-085a87dfd592","block_type":"box","text":"with the interests of shareholders. In addition, we acknowledge that the use of peer group evaluation","page_number":311,"box":{"x":116,"y":475,"width":751,"height":12}},{"id":"a1a5518a-e2cd-4fb3-b098-32317d1f0a10","block_type":"box","text":"by compensation committees can help ensure competitive pay. However, we encourage companies to","page_number":311,"box":{"x":117,"y":490,"width":763,"height":12}},{"id":"2bf9aea7-fbfb-4889-a003-2ba1f4a052b9","block_type":"box","text":"clearly explain how compensation outcomes have rewarded performance rather than solely base","page_number":311,"box":{"x":116,"y":506,"width":724,"height":12}},{"id":"b68c9f08-c5f2-4d83-aaf6-57a2aaf4d0b1","block_type":"box","text":"increases in total compensation on peer benchmarking.","page_number":311,"box":{"x":117,"y":521,"width":416,"height":12}},{"id":"a11f6945-ec22-43d6-92c2-4b0764903a8b","block_type":"box","text":"We consider the inclusion of building clawback provisions into incentive plans as good practice. Such","page_number":311,"box":{"x":116,"y":552,"width":755,"height":12}},{"id":"344ee717-b3bc-461b-a451-07817d9376ca","block_type":"box","text":"provisions could require executives to forgo awards when compensation was based on faulty financial","page_number":311,"box":{"x":117,"y":568,"width":760,"height":12}},{"id":"524c4f9a-bc89-4108-9dea-84826f872460","block_type":"box","text":"statements or deceptive business practices, or when their behavior caused material financial harm to","page_number":311,"box":{"x":116,"y":583,"width":754,"height":12}},{"id":"6b20fe13-0f5f-4c5f-a8d0-b719799cfdae","block_type":"box","text":"shareholders, material reputational risk to the company, or resulted in a criminal investigation.","page_number":311,"box":{"x":116,"y":599,"width":701,"height":12}},{"id":"53bdd041-6873-464e-9697-9c557137e9a9","block_type":"box","text":"In our view, non-executive directors should be compensated in a manner that is commensurate with","page_number":311,"box":{"x":117,"y":630,"width":745,"height":12}},{"id":"09b798c7-9ea9-4982-ac75-45a2b60a491e","block_type":"box","text":"the time and effort expended in fulfilling their professional responsibilities. Additionally, these","page_number":311,"box":{"x":116,"y":645,"width":691,"height":12}},{"id":"e8b6d310-05f8-439c-a85e-3619102a77d0","block_type":"box","text":"compensation arrangements should not risk compromising directors’ independence or aligning their","page_number":311,"box":{"x":116,"y":661,"width":739,"height":12}},{"id":"7190945b-6d3e-4d5e-ae06-814159e4fb57","block_type":"box","text":"interests too closely with those of the management, whom they are charged with overseeing.","page_number":311,"box":{"x":117,"y":676,"width":687,"height":12}},{"id":"ab2fe938-920b-4378-9d3e-f71c509884c5","block_type":"box","text":"When assessing compensation proposals, BIS reviews companies’ disclosures to determine whether","page_number":311,"box":{"x":116,"y":707,"width":750,"height":12}},{"id":"5eebb273-e47a-4a4a-bb62-8290be11b97f","block_type":"box","text":"the board’s approach to executive compensation is rigorous in light of the company’s stated long-term","page_number":311,"box":{"x":116,"y":723,"width":755,"height":12}},{"id":"c1f7985a-3c01-47cf-8583-df6724528f45","block_type":"box","text":"corporate strategy and specific circumstances, as well as local market and policy developments.","page_number":311,"box":{"x":116,"y":738,"width":713,"height":12}},{"id":"9a9e2c76-aec2-4fcd-aa89-5bca1fd10d4e","block_type":"box","text":"When our analysis indicates that executive compensation is misaligned with company performance,","page_number":311,"box":{"x":116,"y":769,"width":739,"height":12}},{"id":"3b07d379-fbe5-42cd-b192-fba7cdba68b8","block_type":"box","text":"BIS may not support management’s proposals to approve compensation, where they are on the","page_number":311,"box":{"x":117,"y":785,"width":709,"height":12}},{"id":"2806e516-d543-4308-af0c-c9df32c29a6b","block_type":"box","text":"agenda. We may also not support members of the compensation committee or equivalent board","page_number":311,"box":{"x":116,"y":800,"width":713,"height":12}},{"id":"75ee9e85-413a-41f0-91c0-bbba2f70ff85","block_type":"box","text":"members for poor compensation practices or structures.","page_number":311,"box":{"x":117,"y":816,"width":415,"height":12}},{"id":"0e19b317-ce62-4472-ab40-5fe58582422e","block_type":"box","text":"8","page_number":311,"box":{"x":143,"y":867,"width":4,"height":5}},{"id":"ca4128d4-b840-4d45-8735-2d8572b05ce6","block_type":"box","text":"The terms “compensation,” “remuneration,” and “pay” are used interchangeably to describe the same concept in","page_number":311,"box":{"x":170,"y":867,"width":664,"height":9}},{"id":"83c0d4bb-62a3-4673-8a8c-3394780e7490","block_type":"box","text":"different markets.","page_number":311,"box":{"x":170,"y":880,"width":102,"height":7}},{"id":"c320bd6c-e997-442f-ad2c-d24fe2f474e9","block_type":"box","text":"BlackRock Investment Stewardship","page_number":311,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"dd0ba8ac-dae3-47f8-980a-28fa4c07d60d","block_type":"box","text":"Global Principles |","page_number":311,"box":{"x":722,"y":909,"width":132,"height":12}},{"id":"3997ae1f-e048-4c0f-9e6a-f3e8f0ef0c2a","block_type":"box","text":"10","page_number":311,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"fd1dc313-c260-44a4-be66-8fb10e88ad52","block_type":"box","text":"NM1026U-6004382-311/605","page_number":311,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"d7a8b9a1-f954-424f-b173-aea17ffbd489","block_type":"box","text":"SHAREHOLDER PROTECTIONS AND OTHER CORPORATE GOVERNANCE MATTERS","page_number":312,"box":{"x":158,"y":87,"width":688,"height":10}},{"id":"8a0eb8a4-dce5-4d19-be3a-ffa980767254","block_type":"box","text":"Corporate form","page_number":312,"box":{"x":116,"y":116,"width":127,"height":12}},{"id":"f05431ed-1ad8-4253-bd8d-7d97c4a724db","block_type":"box","text":"In our view, it is the responsibility of the board to determine the corporate form that is most appropriate","page_number":312,"box":{"x":117,"y":145,"width":766,"height":12}},{"id":"79a2ae4a-36b0-4746-878a-763098bd8893","block_type":"box","text":"given the company’s purpose and business model.","page_number":312,"box":{"x":116,"y":161,"width":376,"height":12}},{"id":"57c1ea4e-ebbe-4d13-adae-33aa429132d6","block_type":"box","text":"9","page_number":312,"box":{"x":494,"y":161,"width":5,"height":6}},{"id":"eb51828d-1f10-467a-bec3-a6b45bd4ea06","block_type":"box","text":"We look to companies proposing to change their","page_number":312,"box":{"x":500,"y":161,"width":369,"height":12}},{"id":"d0881238-c204-4bd5-ac48-af5585b9ad26","block_type":"box","text":"corporate form to a public benefit corporation, or similar entity, to put it to a shareholder vote if not","page_number":312,"box":{"x":116,"y":176,"width":731,"height":12}},{"id":"0746c4fe-1c1b-4708-880a-ea14387712c5","block_type":"box","text":"already required to do so under applicable law. We appreciate when supporting documentation from","page_number":312,"box":{"x":116,"y":192,"width":748,"height":12}},{"id":"46259d0a-1010-4849-b167-8e82ad0ffbd5","block_type":"box","text":"companies or shareholders proposing to alter the corporate form clearly explains how the interests of","page_number":312,"box":{"x":116,"y":207,"width":755,"height":12}},{"id":"ee0f7f32-35ee-4830-af62-a40eaddb70a4","block_type":"box","text":"shareholders and different stakeholders would be impacted as well as the accountability and voting","page_number":312,"box":{"x":116,"y":223,"width":741,"height":12}},{"id":"96840bc5-b231-40ae-8a1f-7d14e4d440fe","block_type":"box","text":"mechanisms that would be available to shareholders. We generally support management proposals if","page_number":312,"box":{"x":117,"y":238,"width":756,"height":12}},{"id":"1d3005fe-662d-4d9f-a68b-c4f0438f46aa","block_type":"box","text":"our analysis indicates that shareholders’ financial interests are adequately protected. Corporate form","page_number":312,"box":{"x":116,"y":254,"width":752,"height":12}},{"id":"36a02cb9-db14-46d4-bb68-8b3383f03908","block_type":"box","text":"shareholder proposals are evaluated on a case-by-case basis.","page_number":312,"box":{"x":116,"y":269,"width":468,"height":12}},{"id":"60ab8e06-abfd-4f19-96cd-f59c2dfdddb7","block_type":"box","text":"SHAREHOLDER PROPOSALS","page_number":312,"box":{"x":380,"y":305,"width":244,"height":10}},{"id":"81b6bfcf-0849-4b18-9e1d-e151d0c752c0","block_type":"box","text":"In most markets, shareholders can submit proposals to be voted on at a company’s shareholder","page_number":312,"box":{"x":117,"y":335,"width":717,"height":12}},{"id":"8c1f29a9-3a77-4a6c-bc79-824c8f1fa068","block_type":"box","text":"meeting, as long as certain requirements are met. Shareholder proposals span a wide range of topics,","page_number":312,"box":{"x":117,"y":350,"width":762,"height":12}},{"id":"f17f91b0-d47d-407e-84e8-265826ba5995","block_type":"box","text":"including governance reforms, capital management, and changes in the management or disclosure of","page_number":312,"box":{"x":117,"y":365,"width":758,"height":13}},{"id":"a9cccc2f-6dce-47ea-8f62-d3716b1b466d","block_type":"box","text":"sustainability-related risks. These proposals have a varying degree of relevance for companies across","page_number":312,"box":{"x":116,"y":381,"width":763,"height":12}},{"id":"c0fc5970-4ff2-438f-8d96-b8f2a37d4a42","block_type":"box","text":"sectors, locations, and business models.","page_number":312,"box":{"x":116,"y":397,"width":307,"height":11}},{"id":"f414eb72-34b0-4a19-bb3b-758f6f3f47d0","block_type":"box","text":"BIS takes a case-by-case approach to voting on shareholder proposals and maintains a singular focus","page_number":312,"box":{"x":117,"y":426,"width":764,"height":12}},{"id":"9492d606-edb4-4b0b-bd1a-2b89c1951053","block_type":"box","text":"on the proposal’s implications for long-term financial value creation for shareholders. Our analysis","page_number":312,"box":{"x":116,"y":441,"width":730,"height":12}},{"id":"7ca6a3ae-dc12-4cd8-bd85-d79e5c63470d","block_type":"box","text":"considers whether a shareholder proposal addresses a material risk that may impact a company’s","page_number":312,"box":{"x":116,"y":457,"width":732,"height":12}},{"id":"ee169578-9798-4f09-8983-24148b4ebab3","block_type":"box","text":"long-term financial performance. BIS may support shareholder proposals that request disclosures that","page_number":312,"box":{"x":117,"y":472,"width":760,"height":12}},{"id":"948b0c7f-7efe-4f3a-b60d-2bf5a970b3c3","block_type":"box","text":"help us, as long-term investors on behalf of our clients, better understand the material risks and","page_number":312,"box":{"x":117,"y":488,"width":713,"height":12}},{"id":"216f6ba5-c318-471d-b04b-25d31bb30869","block_type":"box","text":"opportunities companies face and how they are managing them, especially where this information is","page_number":312,"box":{"x":116,"y":503,"width":747,"height":12}},{"id":"d9c3609f-9f82-4767-9a06-1fdadcec3143","block_type":"box","text":"additive given the company’s existing disclosures. We look for consistency between the specific","page_number":312,"box":{"x":116,"y":519,"width":715,"height":12}},{"id":"d2c85eff-92b8-4bb8-946a-4f2392c8de38","block_type":"box","text":"request formally made in the proposal, the supporting documentation, and the proponents’ other","page_number":312,"box":{"x":117,"y":534,"width":717,"height":12}},{"id":"d971d1c8-4310-40c8-ab92-b380afdf6ec9","block_type":"box","text":"communications on the issues. We also assess the company’s practices and disclosures and the costs","page_number":312,"box":{"x":116,"y":550,"width":769,"height":12}},{"id":"9f20ddc8-cf58-4a15-869f-a47119ff7fd2","block_type":"box","text":"and benefits to the company of meeting the request made in the proposal. We take into consideration a","page_number":312,"box":{"x":116,"y":565,"width":772,"height":12}},{"id":"650e4f01-b2e9-40f9-b223-dc587078219d","block_type":"box","text":"company’s governance practices and disclosures against those of their peers.","page_number":312,"box":{"x":116,"y":581,"width":583,"height":12}},{"id":"b9723385-1276-483f-a40e-d361e1142d6f","block_type":"box","text":"BIS does not support shareholder proposals that we view as inconsistent with long-term financial value","page_number":312,"box":{"x":117,"y":610,"width":767,"height":12}},{"id":"c07f5eb5-a2c3-4880-94f5-c7d234ab3d09","block_type":"box","text":"or that seek to micromanage companies. We take into consideration the legal effect of the proposal, as","page_number":312,"box":{"x":116,"y":625,"width":769,"height":12}},{"id":"8673952d-1a9d-4edb-80ff-35d709dc25ed","block_type":"box","text":"shareholder proposals may be advisory or legally binding depending on the jurisdiction, while others","page_number":312,"box":{"x":116,"y":641,"width":747,"height":12}},{"id":"b5e24619-b534-4caa-af6a-d2c371032eb8","block_type":"box","text":"may make requests that would be deemed illegal in a given jurisdiction.","page_number":312,"box":{"x":117,"y":656,"width":534,"height":12}},{"id":"2d2fe363-3f14-4175-82cf-8042a072c449","block_type":"box","text":"In our experience, it is helpful when companies disclose the names of the proponent or organization","page_number":312,"box":{"x":117,"y":685,"width":740,"height":12}},{"id":"9abdd55a-8a34-42bb-adfa-3e3d83083f19","block_type":"box","text":"that has submitted or advised on the proposal. We recognize that some shareholder proposals bundle","page_number":312,"box":{"x":116,"y":701,"width":757,"height":12}},{"id":"dd7e73d5-3567-456e-8f1d-43adc88490b8","block_type":"box","text":"topics and/or specific requests. Further, the proponent’s supporting statement may refer to topics that","page_number":312,"box":{"x":116,"y":716,"width":753,"height":12}},{"id":"51ac76cc-730e-42e7-83e6-b0d8e18df45d","block_type":"box","text":"are not directly related to the request made in the proposal. In voting on behalf of clients, we must vote","page_number":312,"box":{"x":116,"y":732,"width":762,"height":12}},{"id":"8cfb3557-267c-4f31-b724-41fa14621899","block_type":"box","text":"yes or no on the proposal as phrased by the proponent. Therefore, when we vote in support of a","page_number":312,"box":{"x":116,"y":747,"width":714,"height":13}},{"id":"c90651ec-b0a7-4c39-a691-e9d6a9bbf767","block_type":"box","text":"proposal, we are not necessarily endorsing every element of the proposal or the reasoning, objectives,","page_number":312,"box":{"x":117,"y":763,"width":759,"height":12}},{"id":"ba8ab9b9-45c8-41af-aa99-8e3f0ccd8ce6","block_type":"box","text":"or supporting statement of the proponent. We may support a proposal for different reasons than those","page_number":312,"box":{"x":116,"y":778,"width":757,"height":13}},{"id":"71b8e280-57b2-4877-bd0f-1cce38a9f200","block_type":"box","text":"put forth by the proponent, when we believe that overall it may advance our clients’ long-term financial","page_number":312,"box":{"x":117,"y":794,"width":757,"height":12}},{"id":"8f33a600-6865-44ae-af42-0676928a8a1a","block_type":"box","text":"interests.","page_number":312,"box":{"x":117,"y":810,"width":65,"height":9}},{"id":"348fc9b3-f7ee-4a52-b018-1f1d99f6713f","block_type":"box","text":"BlackRock is subject to certain rules, regulations, agency guidance, and contractual agreements that","page_number":312,"box":{"x":117,"y":839,"width":752,"height":12}},{"id":"d98592fa-6acb-40b4-887a-876e441f5c09","block_type":"box","text":"place restrictions and limitations on how BlackRock can interact with the companies in which we invest","page_number":312,"box":{"x":117,"y":854,"width":766,"height":12}},{"id":"32d77ebf-a705-4ef8-8c2e-20212d833c2b","block_type":"box","text":"9","page_number":312,"box":{"x":143,"y":879,"width":4,"height":5}},{"id":"dd991ded-dd76-4b4b-869a-3259d3b1f218","block_type":"box","text":"Corporate form refers to the legal structure by which a business is organized.","page_number":312,"box":{"x":170,"y":879,"width":457,"height":10}},{"id":"707476c4-ad5e-40ed-9229-79ec4e93e011","block_type":"box","text":"BlackRock Investment Stewardship","page_number":312,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"12554aa1-bcb7-4a2b-90d2-0c6fd89f8227","block_type":"box","text":"Global Principles |","page_number":312,"box":{"x":722,"y":909,"width":132,"height":12}},{"id":"dbdb5784-7dc9-4fc8-a5d0-0e667cabc44c","block_type":"box","text":"11","page_number":312,"box":{"x":866,"y":909,"width":15,"height":9}},{"id":"d5e8e4a2-9552-474a-bb93-80eff21b68d0","block_type":"box","text":"NM1026U-6004382-312/605","page_number":312,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"623f7f53-6e9b-4762-9d95-df4985d52c17","block_type":"box","text":"on behalf of our clients. BlackRock does not nominate directors for board elections or submit","page_number":313,"box":{"x":116,"y":87,"width":692,"height":10}},{"id":"421e4e45-2b1b-4dbd-96ea-985d37a0e87e","block_type":"box","text":"shareholder proposals to companies. Non-compliance with these requirements could adversely affect","page_number":313,"box":{"x":116,"y":102,"width":757,"height":13}},{"id":"ef21fa88-5155-4817-828f-96557913fb1d","block_type":"box","text":"BlackRock’s ability to serve its clients’ interests.","page_number":313,"box":{"x":117,"y":118,"width":358,"height":12}},{"id":"3b48b771-00a5-452e-8dc7-ecabba88cf4b","block_type":"box","text":"MATERIAL SUSTAINABILITY-RELATED RISKS AND OPPORTUNITIES","page_number":313,"box":{"x":223,"y":155,"width":559,"height":10}},{"id":"49011829-a916-4575-8d64-c33e572d0146","block_type":"box","text":"Appropriate oversight of material risks and opportunities, including material sustainability-related risks","page_number":313,"box":{"x":116,"y":186,"width":758,"height":12}},{"id":"2410eae2-e675-4821-90e5-3740e7d80206","block_type":"box","text":"and opportunities, is an important component of having an effective governance framework that","page_number":313,"box":{"x":116,"y":201,"width":714,"height":12}},{"id":"bf26ed4f-bc22-4411-ae90-c0920ef67251","block_type":"box","text":"supports durable, long-term financial value creation.","page_number":313,"box":{"x":116,"y":217,"width":385,"height":12}},{"id":"7b5908f7-032b-47ed-8b9f-d648708a1543","block_type":"box","text":"10","page_number":313,"box":{"x":503,"y":217,"width":11,"height":6}},{"id":"9bfbe143-93fd-4b1f-ae9e-8e18b07ddfa8","block_type":"box","text":"We look to companies to provide robust disclosure that allows investors to effectively evaluate","page_number":313,"box":{"x":116,"y":247,"width":703,"height":12}},{"id":"d9b1fcc1-c5ab-4609-9414-93bb6d1c4f4c","block_type":"box","text":"companies’ strategy and business practices related to material sustainability-related risks and","page_number":313,"box":{"x":116,"y":262,"width":699,"height":12}},{"id":"c0d63a15-3091-4acc-ab80-ce02649c8877","block_type":"box","text":"opportunities. We find it helpful when companies’ disclosures demonstrate that they have a resilient","page_number":313,"box":{"x":116,"y":278,"width":743,"height":12}},{"id":"040f11bc-cfe5-4e2c-8376-de12460b7fac","block_type":"box","text":"business model that integrates material sustainability-related risks and opportunities into their strategy,","page_number":313,"box":{"x":117,"y":293,"width":766,"height":12}},{"id":"caa99c99-6be6-42fc-ba42-2e09d19324bf","block_type":"box","text":"risk management, and metrics and targets, including industry-specific metrics.","page_number":313,"box":{"x":117,"y":309,"width":583,"height":12}},{"id":"8868e5d1-9053-4148-856f-5a9732b9703b","block_type":"box","text":"Standardized disclosure of sustainability-related data supports investors in making informed decisions.","page_number":313,"box":{"x":116,"y":339,"width":766,"height":12}},{"id":"94441e0a-dfa2-4671-bf9e-3af8a2ca2eeb","block_type":"box","text":"The International Sustainability Standards Board (ISSB) standards, IFRS S1 and S2, represent one","page_number":313,"box":{"x":116,"y":354,"width":743,"height":12}},{"id":"45eb42b2-9d53-41f3-b8ec-dfc623aa49f4","block_type":"box","text":"such approach to standardization that we find useful in our analysis.","page_number":313,"box":{"x":116,"y":370,"width":503,"height":12}},{"id":"6a96d166-5443-476e-9f7f-cbba98b18e95","block_type":"box","text":"11","page_number":313,"box":{"x":622,"y":370,"width":9,"height":6}},{"id":"08ed8146-56eb-4422-89a7-3a129136dc44","block_type":"box","text":"However, we do not mandate","page_number":313,"box":{"x":633,"y":370,"width":228,"height":11}},{"id":"9868c158-e751-4504-9a54-8d70f333b4b8","block_type":"box","text":"any specific disclosure framework companies should use, and recognize that companies may report","page_number":313,"box":{"x":116,"y":385,"width":747,"height":12}},{"id":"b4c9e584-25e7-4944-94a8-9001be8b032a","block_type":"box","text":"using different standards, some of which may be required by regulation. In such cases, we ask that","page_number":313,"box":{"x":117,"y":401,"width":739,"height":12}},{"id":"52e0b74d-b48c-4feb-80e1-c33b2c35f0ee","block_type":"box","text":"companies highlight the metrics that are industry- or company-specific.","page_number":313,"box":{"x":116,"y":416,"width":530,"height":12}},{"id":"6c3a5674-849e-4e52-a1c7-a37aee9941de","block_type":"box","text":"We also recognize that companies may be phasing in reporting over several years. We do not","page_number":313,"box":{"x":116,"y":447,"width":702,"height":11}},{"id":"12bd4568-39d9-4a00-84b4-89d09f7c7084","block_type":"box","text":"prescribe timelines regarding when companies should make sustainability-related disclosures but","page_number":313,"box":{"x":117,"y":462,"width":725,"height":12}},{"id":"c95d3ac2-7c1b-406b-928d-58049ae1dc2c","block_type":"box","text":"appreciate it when companies produce them sufficiently in advance of their shareholder meeting, to the","page_number":313,"box":{"x":116,"y":477,"width":770,"height":12}},{"id":"63826cd4-22f8-4d87-9476-994a3cd46cfd","block_type":"box","text":"best of their abilities, to provide investors with time to assess the data and make informed voting","page_number":313,"box":{"x":117,"y":493,"width":718,"height":12}},{"id":"be4a5027-4e1c-42ea-ab51-6ec44dc6c232","block_type":"box","text":"decisions.","page_number":313,"box":{"x":116,"y":509,"width":79,"height":9}},{"id":"679383bf-925b-4aa6-bd48-270b925bc29f","block_type":"box","text":"Industry initiatives on managing specific operational risks may also provide useful guidance to","page_number":313,"box":{"x":117,"y":538,"width":700,"height":13}},{"id":"633fbf21-68fd-4bf4-ae73-4964ae8ebe5d","block_type":"box","text":"companies on best practices and disclosures. While not a voting item, we find it helpful to our","page_number":313,"box":{"x":116,"y":554,"width":697,"height":12}},{"id":"97f3d91c-b5d2-42da-b438-85fbbee1fc40","block_type":"box","text":"understanding of investment risk when companies disclose any relevant global sustainability-related","page_number":313,"box":{"x":117,"y":569,"width":746,"height":13}},{"id":"e7065290-c932-486f-8cea-fbb14370f555","block_type":"box","text":"standards adopted, the industry initiatives in which they participate, any peer group benchmarking","page_number":313,"box":{"x":116,"y":585,"width":731,"height":12}},{"id":"c18994a8-7ca8-461c-94da-49622ffe97d8","block_type":"box","text":"undertaken, and any assurance processes to help investors understand their approach to sustainable","page_number":313,"box":{"x":117,"y":601,"width":758,"height":12}},{"id":"ba877eb0-50c8-4a09-8d05-0c02e290b25f","block_type":"box","text":"and responsible business practices.","page_number":313,"box":{"x":116,"y":616,"width":271,"height":12}},{"id":"809928ff-d9ea-4b00-82a7-c6d54090dc59","block_type":"box","text":"Climate and nature-related risk","page_number":313,"box":{"x":116,"y":646,"width":251,"height":10}},{"id":"20349c39-78d1-4946-952f-b5749c0230fd","block_type":"box","text":"Many companies are assessing how to navigate the low-carbon transition while delivering long-term","page_number":313,"box":{"x":117,"y":676,"width":739,"height":12}},{"id":"dd75fa80-6546-4782-a70b-9531b8d3535e","block_type":"box","text":"financial value to investors. For companies facing material climate-related risks, we find it helpful when","page_number":313,"box":{"x":116,"y":692,"width":760,"height":12}},{"id":"fddad6c7-5e4b-480e-b97a-d91c69f4e207","block_type":"box","text":"they publicly disclose, consistent with their business model and sector, how they intend to deliver long","page_number":313,"box":{"x":116,"y":707,"width":762,"height":12}},{"id":"5a990f80-1a32-47dc-a06f-5629bfa30604","block_type":"box","text":"term financial performance through the low-carbon transition, including where available, their transition","page_number":313,"box":{"x":116,"y":723,"width":760,"height":12}},{"id":"373ae49f-a291-4718-ac33-8decd2934c0c","block_type":"box","text":"10","page_number":313,"box":{"x":144,"y":748,"width":8,"height":5}},{"id":"fde43455-1fa5-4272-89e0-3cb765ef402e","block_type":"box","text":"By material sustainability-related risks and opportunities, we mean the drivers of risk and financial value creation in a","page_number":313,"box":{"x":171,"y":748,"width":691,"height":10}},{"id":"1cfc8010-b2b8-4200-af62-c28751d6334e","block_type":"box","text":"company’s business model that have an environmental or social dependency or impact. Examples of environmental","page_number":313,"box":{"x":170,"y":761,"width":686,"height":9}},{"id":"ca9f8134-7ee4-4355-a4bd-c5d3dff6e127","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":313,"box":{"x":170,"y":774,"width":682,"height":9}},{"id":"7ddc38b8-8965-4069-ac84-2585521c6274","block_type":"box","text":"issues include, but are not limited to, human capital management, impacts on the communities in which a company","page_number":313,"box":{"x":170,"y":787,"width":683,"height":9}},{"id":"21693660-c9d0-47db-9eff-c31c0a660789","block_type":"box","text":"operates, customer loyalty, and relationships with regulators.","page_number":313,"box":{"x":170,"y":800,"width":360,"height":9}},{"id":"176258c7-4390-42f3-9ff4-99a43b785b24","block_type":"box","text":"11","page_number":313,"box":{"x":144,"y":815,"width":7,"height":5}},{"id":"fb1494e3-7771-4295-8c36-e64ad1ddd202","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Reporting Standards (IFRS)","page_number":313,"box":{"x":170,"y":815,"width":666,"height":10}},{"id":"928b1da4-b3a4-4d1a-8114-7ebe0a8bcd2f","block_type":"box","text":"Foundation. The standards build on the Task Force on Climate-related Financial Disclosures (TCFD) framework and the","page_number":313,"box":{"x":171,"y":828,"width":712,"height":9}},{"id":"e6cf70f1-a7e4-424f-adf4-c5774b3331ae","block_type":"box","text":"standards and metrics developed by the Sustainability Accounting Standards Board (SASB), which have both","page_number":313,"box":{"x":170,"y":841,"width":649,"height":9}},{"id":"b799b98a-ca3f-4a4c-995c-ebaf78c43130","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":313,"box":{"x":170,"y":854,"width":674,"height":9}},{"id":"a80e4783-42ea-4678-9692-8d296190022c","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":313,"box":{"x":170,"y":867,"width":647,"height":9}},{"id":"db9a6c39-d940-41e6-b827-ef02906ef2bc","block_type":"box","text":"Disclosures.” Websites accessed in December 2025.","page_number":313,"box":{"x":171,"y":880,"width":312,"height":7}},{"id":"ed078c57-4642-487c-86ef-66a7d3db7c27","block_type":"box","text":"BlackRock Investment Stewardship","page_number":313,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"8ff594ea-0077-4bda-83e9-dd852a32e8b6","block_type":"box","text":"Global Principles |","page_number":313,"box":{"x":722,"y":909,"width":132,"height":12}},{"id":"38c52071-96f9-4ba3-b339-9af16ec7f73e","block_type":"box","text":"12","page_number":313,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"89d6bebc-aa3a-47e2-b286-8d45f002efa9","block_type":"box","text":"NM1026U-6004382-313/605","page_number":313,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ca537c7b-400c-4c02-9300-390c5f9068cb","block_type":"box","text":"plan.","page_number":314,"box":{"x":117,"y":87,"width":34,"height":12}},{"id":"8d71257e-e77c-4250-b046-839d008c0bc1","block_type":"box","text":"12, 13","page_number":314,"box":{"x":153,"y":87,"width":29,"height":7}},{"id":"cf390f57-fc32-4151-b308-fd909e98f4a3","block_type":"box","text":"From company disclosures and engagement, we seek to understand the strategies","page_number":314,"box":{"x":182,"y":87,"width":626,"height":12}},{"id":"85ec28f3-5f52-4474-8042-b62342da596b","block_type":"box","text":"companies have in place to manage material risks to, and opportunities for, their long-term business","page_number":314,"box":{"x":116,"y":102,"width":748,"height":13}},{"id":"7cbfe0ae-528a-4510-af65-c8b19ef2999d","block_type":"box","text":"model associated with a range of climate-related scenarios.","page_number":314,"box":{"x":117,"y":118,"width":446,"height":12}},{"id":"ea5cdb5d-afe3-4140-8232-3ee5c9e4bd2c","block_type":"box","text":"Recognizing the value of these disclosures, certain markets such as the European Union mandate","page_number":314,"box":{"x":117,"y":152,"width":734,"height":12}},{"id":"1a8fce78-73d7-48f1-b1ff-3a153b178008","block_type":"box","text":"large companies to disclose such climate-related financial information, while in other jurisdictions these","page_number":314,"box":{"x":117,"y":168,"width":767,"height":12}},{"id":"0f5d6b62-152e-4a7c-b029-990e28920540","block_type":"box","text":"disclosures are viewed as best practice in the market.","page_number":314,"box":{"x":116,"y":183,"width":404,"height":12}},{"id":"39e4e325-3630-4db1-80a9-ddd5cb4bcce1","block_type":"box","text":"The ISSB standards provide one such framework that can assist investors in assessing company","page_number":314,"box":{"x":116,"y":217,"width":726,"height":12}},{"id":"966722c2-90f8-4ba1-a16b-b4e3ae203234","block_type":"box","text":"specific climate-related risks and opportunities, and informing investment decisions. Such disclosures","page_number":314,"box":{"x":116,"y":233,"width":757,"height":12}},{"id":"f9a827aa-5a45-4ab6-9869-887b5ad17c2d","block_type":"box","text":"also provide investors with insights into how companies are managing the risks associated with a","page_number":314,"box":{"x":116,"y":248,"width":726,"height":12}},{"id":"79508d77-5dee-469a-b3d5-cfcab4098457","block_type":"box","text":"transition to a low-carbon economy by managing their own carbon emissions or emissions intensities","page_number":314,"box":{"x":116,"y":264,"width":754,"height":12}},{"id":"ad5ed97b-9d58-4c8a-821e-626458ab275c","block_type":"box","text":"to the extent financially practicable.","page_number":314,"box":{"x":116,"y":279,"width":266,"height":12}},{"id":"38b71194-f27b-4a5e-9b96-b05ad2e2b6ad","block_type":"box","text":"The ISSB standards, for example, contemplate disclosures on how companies are setting short-,","page_number":314,"box":{"x":116,"y":313,"width":723,"height":12}},{"id":"d06818f6-bd66-4131-99c0-55b1d196fda0","block_type":"box","text":"medium- and long-term targets, ideally science-based where these are available for their sector, for","page_number":314,"box":{"x":117,"y":329,"width":742,"height":12}},{"id":"d1ef4fd2-2922-4b0c-9301-2548cceb4fd4","block_type":"box","text":"scope 1 and 2 greenhouse gas emissions (GHG) reductions and to demonstrate how their targets are","page_number":314,"box":{"x":116,"y":344,"width":760,"height":12}},{"id":"b57b0767-2a09-40c2-8c45-f974966df271","block_type":"box","text":"consistent with the long-term financial interests of their investors.","page_number":314,"box":{"x":116,"y":360,"width":486,"height":12}},{"id":"19500a7f-12e4-49bb-8f0a-6548018b2b2e","block_type":"box","text":"While we recognize that regulators in some markets are moving to mandate certain disclosures, at this","page_number":314,"box":{"x":116,"y":394,"width":766,"height":12}},{"id":"ce81c599-96b2-4721-bcfa-81ad7d1fac05","block_type":"box","text":"stage, we view scope 3 emissions differently from scopes 1 and 2, given methodological complexity,","page_number":314,"box":{"x":116,"y":409,"width":749,"height":13}},{"id":"1ef0e61d-6eeb-4ae9-a136-d2b3666aeacc","block_type":"box","text":"regulatory uncertainty, concerns about double-counting, and lack of direct control by companies. We","page_number":314,"box":{"x":117,"y":425,"width":749,"height":12}},{"id":"e49df517-3316-47d7-997c-4761c706af49","block_type":"box","text":"welcome disclosures and commitments that companies choose to make regarding material scope 3","page_number":314,"box":{"x":116,"y":441,"width":744,"height":12}},{"id":"3a138e06-ae0a-44af-a77d-ba3d31ef11ee","block_type":"box","text":"emissions and recognize that these are provided on a good-faith basis as methodology develops.","page_number":314,"box":{"x":116,"y":456,"width":728,"height":12}},{"id":"35c56915-8562-421f-94d6-da1628fb441e","block_type":"box","text":"In addition to climate-related risks and opportunities, for companies whose strategies, operations or","page_number":314,"box":{"x":117,"y":490,"width":742,"height":12}},{"id":"04307dbc-f793-4794-acb9-700207985856","block_type":"box","text":"supply chains are materially reliant on natural capital, nature-related risks and opportunities may affect","page_number":314,"box":{"x":116,"y":506,"width":765,"height":12}},{"id":"57f6cef7-3216-4568-8739-b2bc2f6883ed","block_type":"box","text":"their ability to generate long-term financial returns.","page_number":314,"box":{"x":116,"y":521,"width":372,"height":12}},{"id":"fb84f9a3-4b6d-44d0-aaed-4132415d9a7f","block_type":"box","text":"14","page_number":314,"box":{"x":491,"y":521,"width":11,"height":6}},{"id":"d27fab10-194b-4268-9a95-fb044818d462","block_type":"box","text":"For these companies, we rely on disclosures to","page_number":314,"box":{"x":502,"y":521,"width":360,"height":12}},{"id":"76ad71b2-f89d-4e96-b4d9-68d143c90df7","block_type":"box","text":"understand how their strategies consider nature-related impacts and dependencies and to assess how","page_number":314,"box":{"x":117,"y":537,"width":765,"height":12}},{"id":"7bd649b5-db43-4446-bc96-92afde0550f7","block_type":"box","text":"the board oversees these risks.","page_number":314,"box":{"x":116,"y":552,"width":232,"height":10}},{"id":"af6f501b-fb37-4830-abf6-cb04f2d9fbff","block_type":"box","text":"15","page_number":314,"box":{"x":351,"y":552,"width":10,"height":6}},{"id":"8ac4d064-ca3e-4529-9547-c71effb1d089","block_type":"box","text":"Companies’ impact on their workforce, supply chains, and communities","page_number":314,"box":{"x":116,"y":586,"width":580,"height":12}},{"id":"1a03b485-230c-4262-8b23-243762b0cf1d","block_type":"box","text":"Companies determine their key stakeholders based on what is material to their business and long-term","page_number":314,"box":{"x":117,"y":620,"width":768,"height":12}},{"id":"eaa8504a-cd0c-4819-a942-365e4bbdcf41","block_type":"box","text":"financial performance. For many companies, key stakeholders include employees, business supply","page_number":314,"box":{"x":116,"y":636,"width":741,"height":12}},{"id":"f110817c-e9ef-49ac-bcd7-a978942ab431","block_type":"box","text":"chains, clients and consumers, regulators, and the communities in which they operate.","page_number":314,"box":{"x":116,"y":651,"width":647,"height":12}},{"id":"02ca91c6-5124-420c-b9d9-5e9d281291cd","block_type":"box","text":"12","page_number":314,"box":{"x":144,"y":677,"width":8,"height":4}},{"id":"56c18aac-37f3-4558-bf2e-1aa58b1c4837","block_type":"box","text":"We have observed that more companies are developing such plans, and public policymakers in certain markets are","page_number":314,"box":{"x":170,"y":677,"width":685,"height":9}},{"id":"985b5c21-f03a-4c0e-be91-962a2867a6f9","block_type":"box","text":"signaling their intentions to require them or already have requirements in place, such as Australia, Brazil, and the","page_number":314,"box":{"x":170,"y":690,"width":670,"height":9}},{"id":"a54642a0-d29b-4796-b796-4087982995e1","block_type":"box","text":"European Union (please see the International Transition Plan Network for information). We view transition plans as a","page_number":314,"box":{"x":171,"y":702,"width":691,"height":10}},{"id":"db9e82f4-632a-4bff-bdf9-d3549e58af7b","block_type":"box","text":"method for a company to both internally assess and externally communicate its long-term strategy, ambition, objectives,","page_number":314,"box":{"x":170,"y":715,"width":710,"height":10}},{"id":"d48c7897-e1d7-4fa2-bdde-4598c7e9dcfa","block_type":"box","text":"and actions to create financial value through the global transition towards a low-carbon economy. Across the landscape","page_number":314,"box":{"x":170,"y":728,"width":709,"height":10}},{"id":"feea1fe1-e85c-41c4-953a-5b6846b6a6d0","block_type":"box","text":"there remains divergence on the objectives of such plans and the details they should contain. While transition plans can","page_number":314,"box":{"x":170,"y":741,"width":710,"height":10}},{"id":"d1326b2b-99da-4942-90cf-6fe6d830dcfc","block_type":"box","text":"be helpful disclosure, BIS does not make the preparation and production of transition plans a voting issue. BIS may","page_number":314,"box":{"x":170,"y":754,"width":684,"height":10}},{"id":"eba7ec4d-0eee-4374-a3f2-88d4b8138801","block_type":"box","text":"engage companies that have chosen to publish a transition plan to understand their planned actions and resource","page_number":314,"box":{"x":170,"y":767,"width":675,"height":10}},{"id":"86bf2475-d967-4679-bda8-c71cacf59ebb","block_type":"box","text":"implications. Website accessed in December 2025.","page_number":314,"box":{"x":170,"y":780,"width":303,"height":9}},{"id":"596f1d2e-0539-406f-8d85-c651d2bb92c4","block_type":"box","text":"13","page_number":314,"box":{"x":144,"y":796,"width":8,"height":5}},{"id":"3d67ee5c-43b0-469d-acb4-97476d20aeff","block_type":"box","text":"For more information, please see our commentary “Climate-related risks and a low-carbon transition,” December 2025.","page_number":314,"box":{"x":171,"y":796,"width":703,"height":10}},{"id":"1501b46f-ed4e-49c6-89a0-63fac238dda3","block_type":"box","text":"14","page_number":314,"box":{"x":144,"y":812,"width":8,"height":5}},{"id":"dd3c13fc-f7c4-47ac-8b81-a6053f60e106","block_type":"box","text":"For more information, please see our commentary “Our approach to engagement on natural capital,” December 2025.","page_number":314,"box":{"x":171,"y":812,"width":697,"height":10}},{"id":"fe385ed5-de22-4cf9-aa3e-748564b766b7","block_type":"box","text":"15","page_number":314,"box":{"x":144,"y":828,"width":8,"height":5}},{"id":"151c3a28-e12b-4a20-93e8-35b93faf0eda","block_type":"box","text":"Given the growing awareness of the materiality of these issues for certain businesses, enhanced reporting on a","page_number":314,"box":{"x":170,"y":828,"width":660,"height":10}},{"id":"65129456-c0e1-4db1-b2e5-ed60e7baf704","block_type":"box","text":"company’s natural capital dependencies and impacts would aid investors’ understanding. The recommendations of the","page_number":314,"box":{"x":170,"y":841,"width":704,"height":9}},{"id":"59cfecbb-8cc0-4323-8c5e-b8dc4350be34","block_type":"box","text":"Taskforce on Nature-related Financial Disclosures (TNFD) may prove useful to some companies. We recognize that","page_number":314,"box":{"x":170,"y":854,"width":689,"height":9}},{"id":"68c6bf9f-1c98-4ac7-b803-37d7a1646d8b","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":314,"box":{"x":170,"y":867,"width":680,"height":9}},{"id":"2ba20b61-319a-415f-80b2-b0878337d0eb","block_type":"box","text":"other private sector standards. TNFD-aligned reporting is not a voting issue. Website accessed in December 2025.","page_number":314,"box":{"x":170,"y":880,"width":680,"height":9}},{"id":"17b6a38c-2ca3-49da-9c45-326b16653ba2","block_type":"box","text":"BlackRock Investment Stewardship","page_number":314,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"f4e7bab6-1d84-486c-bbe3-045332d1b52c","block_type":"box","text":"Global Principles |","page_number":314,"box":{"x":722,"y":909,"width":132,"height":12}},{"id":"5bd6e950-e539-46e3-a798-e917fb347057","block_type":"box","text":"13","page_number":314,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"7c802c0c-e137-4b1a-8adf-782c12c63180","block_type":"box","text":"NM1026U-6004382-314/605","page_number":314,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"1b8835ac-2c44-4c8b-b000-321a0c8a4f13","block_type":"box","text":"In our experience, companies that invest in the relationships that are critical to their strategic objectives","page_number":315,"box":{"x":117,"y":87,"width":769,"height":12}},{"id":"9806c5bf-fccc-4c26-ac29-c569537f1235","block_type":"box","text":"are more likely to deliver durable, long-term financial performance. By contrast, we have found that","page_number":315,"box":{"x":116,"y":102,"width":739,"height":13}},{"id":"64ea9bf9-8971-4fb3-9481-436b43ffd356","block_type":"box","text":"poor relationships may create adverse impacts that could expose companies to legal, regulatory,","page_number":315,"box":{"x":117,"y":118,"width":722,"height":12}},{"id":"bc1b3f49-e503-4444-a20e-b0001bdd58bb","block_type":"box","text":"operational, and reputational risks. This is particularly relevant to a company’s workforce, which is","page_number":315,"box":{"x":116,"y":134,"width":730,"height":12}},{"id":"02cd657a-7fb2-44c8-b8a6-2b773603dcd6","block_type":"box","text":"central to long-term financial value creation.","page_number":315,"box":{"x":116,"y":149,"width":324,"height":12}},{"id":"ed23f68d-73e7-40fa-843a-f1c8d85f8e42","block_type":"box","text":"16","page_number":315,"box":{"x":442,"y":149,"width":11,"height":6}},{"id":"c6991bcc-2104-4fca-95f3-f65d3610aa08","block_type":"box","text":"As a long-term shareholder on behalf of our clients, we find it helpful when companies disclose how","page_number":315,"box":{"x":116,"y":179,"width":743,"height":13}},{"id":"17a35d8c-4079-467d-8722-5b46d1785180","block_type":"box","text":"they have identified their key stakeholders and considered their interests in business decision-making.","page_number":315,"box":{"x":116,"y":195,"width":763,"height":12}},{"id":"62ced3eb-d85d-466d-a452-ff8734701dc5","block_type":"box","text":"In addition to understanding broader stakeholder relationships, BIS finds it helpful when companies","page_number":315,"box":{"x":117,"y":210,"width":740,"height":13}},{"id":"1b97b665-9121-40a7-b831-02f1d837a551","block_type":"box","text":"discuss how they consider the needs of their workforce today, and the skills required for their future","page_number":315,"box":{"x":116,"y":226,"width":742,"height":12}},{"id":"d3ef7271-6159-4582-b317-2925796b19da","block_type":"box","text":"business strategy. We are also interested in understanding how the board monitors and engages on","page_number":315,"box":{"x":117,"y":242,"width":747,"height":12}},{"id":"6ebf555f-4746-4974-b2a1-f8a41f470270","block_type":"box","text":"these matters, given it is well positioned to ensure that the approach taken by management is informed","page_number":315,"box":{"x":116,"y":257,"width":770,"height":12}},{"id":"fe9733d1-57aa-4db7-98df-c667e720e9c6","block_type":"box","text":"by and aligns with the company’s strategy. BIS does not direct a company’s policies or practices, which","page_number":315,"box":{"x":117,"y":272,"width":771,"height":13}},{"id":"de7e6b2f-ead3-4bea-a993-db05662d2702","block_type":"box","text":"are the responsibility of management and the board.","page_number":315,"box":{"x":116,"y":288,"width":394,"height":12}},{"id":"c6f00315-2e8d-42f6-9e93-f238fa062be8","block_type":"box","text":"In addition, we find it helpful when companies disclose their approach to addressing material adverse","page_number":315,"box":{"x":117,"y":318,"width":754,"height":12}},{"id":"5dfb86fb-41d2-4af5-8357-217a11045745","block_type":"box","text":"impacts that could arise from their business practices and affect critical relationships with their","page_number":315,"box":{"x":117,"y":334,"width":701,"height":12}},{"id":"326b4a43-f80c-458a-b35a-e857b5e7107b","block_type":"box","text":"stakeholders. We encourage companies to implement, to the extent appropriate, monitoring processes","page_number":315,"box":{"x":116,"y":350,"width":767,"height":12}},{"id":"109206d1-2de0-45a7-acdd-831ecfd592e3","block_type":"box","text":"(often referred to as due diligence) to identify and mitigate potential adverse impacts and grievance","page_number":315,"box":{"x":117,"y":365,"width":740,"height":12}},{"id":"2f2a4f39-6ac5-4606-80bb-b0aa9eaf8c4b","block_type":"box","text":"mechanisms to remediate any actual adverse material impacts.","page_number":315,"box":{"x":117,"y":381,"width":474,"height":12}},{"id":"cea247a1-2d48-48b5-99d4-2696a5a42b9f","block_type":"box","text":"We look to boards to oversee management’s approach to addressing material risks related to key","page_number":315,"box":{"x":116,"y":411,"width":729,"height":12}},{"id":"abac067c-6be5-41e9-84ed-9f2b303c68df","block_type":"box","text":"stakeholders and may convey concerns about board oversight in our voting on director elections or","page_number":315,"box":{"x":116,"y":426,"width":739,"height":12}},{"id":"8f1b7c1d-5255-4765-a29b-3004ca491711","block_type":"box","text":"supporting a business relevant shareholder proposal when, in our assessment, the board is not acting","page_number":315,"box":{"x":116,"y":442,"width":761,"height":12}},{"id":"8bfc8973-bc22-4d5e-82d3-bcdb23d30aef","block_type":"box","text":"in shareholders’ long-term financial interests.","page_number":315,"box":{"x":117,"y":457,"width":337,"height":12}},{"id":"106ce18d-571f-4207-9908-14b31c7b7c39","block_type":"box","text":"BLACKROCK’S OVERSIGHT OF ITS INVESTMENT STEWARDSHIP ACTIVITIES","page_number":315,"box":{"x":188,"y":495,"width":629,"height":10}},{"id":"a3cf4252-0ef0-4125-8487-9877dcf7c33d","block_type":"box","text":"BIS’ governance structure supports oversight and accountability of stewardship-related activities on","page_number":315,"box":{"x":117,"y":526,"width":742,"height":12}},{"id":"6d51b1b6-3a1f-4107-99ed-f8ad71a8d81f","block_type":"box","text":"behalf of clients at the global and regional level.","page_number":315,"box":{"x":117,"y":541,"width":358,"height":12}},{"id":"fadf8d4e-2b66-4e05-9bde-7abcc9095f36","block_type":"box","text":"At the top of this governance structure, the risk-focused BIS Global Oversight Committee (the","page_number":315,"box":{"x":116,"y":572,"width":699,"height":12}},{"id":"311580c0-5f5f-47a0-87b3-fe0278de948a","block_type":"box","text":"Committee) supports BIS’ regulatory responsibilities in relation to proxy voting, including adherence to","page_number":315,"box":{"x":117,"y":587,"width":760,"height":12}},{"id":"2933d6db-6c25-4700-bd82-feacafa43514","block_type":"box","text":"policies and procedures as well as market-level stewardship requirements. The Committee reviews","page_number":315,"box":{"x":117,"y":603,"width":740,"height":12}},{"id":"e51f64de-c0a1-494f-ba5d-213ee4b269bc","block_type":"box","text":"and approves amendments to the Global Principles and regional voting guidelines. The Committee","page_number":315,"box":{"x":116,"y":618,"width":738,"height":12}},{"id":"83877f5c-59dc-46d2-811d-d35cea55a018","block_type":"box","text":"also reviews periodic reports regarding the votes cast by BIS on behalf of clients, as well as updates","page_number":315,"box":{"x":116,"y":634,"width":749,"height":12}},{"id":"883ac5b6-0de7-4bd9-a2c8-adb8d66515d8","block_type":"box","text":"on material process issues, procedural changes, and other risk oversight considerations. The","page_number":315,"box":{"x":116,"y":649,"width":697,"height":12}},{"id":"f9dbbb5e-a541-4276-a86a-eed9eddd103a","block_type":"box","text":"Committee is chaired by the Global Heads of the Investment Stewardship function and its members","page_number":315,"box":{"x":117,"y":665,"width":737,"height":12}},{"id":"7f9b8b19-8c31-42e0-9a94-7d7ec08e597a","block_type":"box","text":"include senior BlackRock executives with legal, risk, and other experience relevant to team oversight","page_number":315,"box":{"x":117,"y":680,"width":747,"height":12}},{"id":"73ac2b7d-358e-46f3-96a9-673869019361","block_type":"box","text":"who are independent from the investment stewardship function.","page_number":315,"box":{"x":116,"y":696,"width":471,"height":12}},{"id":"88fada2e-a6e4-4019-9568-878f9eae809b","block_type":"box","text":"The Global Heads have primary oversight of BIS’ activities globally, including voting in accordance with","page_number":315,"box":{"x":116,"y":726,"width":764,"height":12}},{"id":"8d91bbf4-881d-4968-89ec-8ee212eb1800","block_type":"box","text":"the Global Principles and regional voting guidelines. At the regional level, three regional Heads for the","page_number":315,"box":{"x":116,"y":742,"width":756,"height":12}},{"id":"98095ad2-d4b1-45a7-a493-80c2686f9b5f","block_type":"box","text":"Americas, APAC, and EMEA oversee BIS’ activities for their specific markets.","page_number":315,"box":{"x":116,"y":757,"width":574,"height":12}},{"id":"6efc08e9-8027-44ab-b3e7-1fa313686a73","block_type":"box","text":"VOTE EXECUTION","page_number":315,"box":{"x":425,"y":795,"width":148,"height":10}},{"id":"57137108-a422-45b3-86c7-572421213d7f","block_type":"box","text":"BIS votes proxies on behalf of index equity funds and accounts when authorized by our clients. We","page_number":315,"box":{"x":117,"y":825,"width":739,"height":13}},{"id":"df9137f4-61c9-44bb-bc83-3024bd89f57e","block_type":"box","text":"have processes in place to consider all proxies for which we have voting authority, and submit voting","page_number":315,"box":{"x":117,"y":841,"width":751,"height":12}},{"id":"51332645-d274-41ee-9c77-b27fc9978118","block_type":"box","text":"16","page_number":315,"box":{"x":144,"y":866,"width":8,"height":5}},{"id":"96f367f4-0d10-4d84-aaec-ea7c1c68521b","block_type":"box","text":"For more information, please see our commentary “Our approach to engagement on human capital management,”","page_number":315,"box":{"x":171,"y":866,"width":677,"height":10}},{"id":"a876dbab-0179-420c-85a7-b8d65c3885af","block_type":"box","text":"December 2025.","page_number":315,"box":{"x":171,"y":879,"width":97,"height":8}},{"id":"48d4f6bb-471d-4742-b82c-0bc3606a6ad2","block_type":"box","text":"BlackRock Investment Stewardship","page_number":315,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"14b12dad-791e-4592-97b7-77159e69d5db","block_type":"box","text":"Global Principles |","page_number":315,"box":{"x":722,"y":909,"width":132,"height":12}},{"id":"2a88b0e7-b421-4060-8ace-29e4628995e7","block_type":"box","text":"14","page_number":315,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"09cc4bcc-9932-4ab6-ac92-604a0a193a29","block_type":"box","text":"NM1026U-6004382-315/605","page_number":315,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9d384dfa-bdf5-4ed6-bdfe-410447b98a56","block_type":"box","text":"decisions, or refrain from voting when logistical issues arise (see below). The BIS Benchmark","page_number":316,"box":{"x":116,"y":87,"width":698,"height":12}},{"id":"0423f9d1-f5a8-4933-b262-926154b8c7f8","block_type":"box","text":"Policies – and the vote decisions made consistent with those policies – reflect our reasonable and","page_number":316,"box":{"x":117,"y":102,"width":730,"height":12}},{"id":"4bb09a7f-c9e4-4a4a-8b17-345968ff7804","block_type":"box","text":"independent judgment and are made without regard to the relationship between the issuer of the proxy","page_number":316,"box":{"x":117,"y":118,"width":766,"height":12}},{"id":"82d1ef22-fe41-4cbd-a8e9-c63136d826b9","block_type":"box","text":"(or any shareholder proponent or dissident shareholder) and the Fund, the Fund’s affiliates (if any),","page_number":316,"box":{"x":117,"y":134,"width":739,"height":12}},{"id":"52bf9f00-c7c4-4d70-94f8-012e8314ecc2","block_type":"box","text":"BlackRock or BlackRock’s affiliates, or BlackRock employees (see “Conflicts management policies and","page_number":316,"box":{"x":117,"y":149,"width":768,"height":12}},{"id":"9f846933-b41b-4bc6-a6f7-88e7bb6e84e6","block_type":"box","text":"procedures,” below).","page_number":316,"box":{"x":117,"y":165,"width":157,"height":12}},{"id":"ba7e0c78-8ec0-4242-8e64-2745ff88c138","block_type":"box","text":"In certain markets, proxy voting involves logistical issues which can affect BIS’ ability to vote, as well","page_number":316,"box":{"x":117,"y":196,"width":749,"height":12}},{"id":"3ae8734f-85ec-49ed-81c8-b8d454057161","block_type":"box","text":"as the cost of voting such proxies on behalf of our clients. These issues include, but are not limited to:","page_number":316,"box":{"x":116,"y":212,"width":761,"height":12}},{"id":"bb505028-77f7-4bcd-b011-fb9db52d461d","block_type":"box","text":"1) untimely notice of shareholder meetings; 2) restrictions on a foreigner’s ability to exercise votes; 3)","page_number":316,"box":{"x":118,"y":227,"width":754,"height":12}},{"id":"bbe3dff0-51e8-4c38-acef-e8ea900b984e","block_type":"box","text":"requirements to vote proxies in person; 4) “share-blocking” (requirements that investors who exercise","page_number":316,"box":{"x":117,"y":243,"width":756,"height":12}},{"id":"00574b9a-cac0-4d08-b449-ab2c9f50b407","block_type":"box","text":"their voting rights surrender the right to dispose of their holdings from the point at which votes are","page_number":316,"box":{"x":116,"y":258,"width":728,"height":12}},{"id":"bff2c200-ef4d-43f8-8c5d-fe9a1fe6c182","block_type":"box","text":"submitted until after the after the shareholder meeting has occurred); 5) potential difficulties in","page_number":316,"box":{"x":116,"y":274,"width":701,"height":12}},{"id":"5abcab61-9d31-4cc7-901c-57f0dd39089d","block_type":"box","text":"translating the proxy; 6) regulatory constraints; and 7) requirements to provide local agents with","page_number":316,"box":{"x":116,"y":289,"width":714,"height":12}},{"id":"17679550-d28a-4f60-ad3d-0de60d5f6237","block_type":"box","text":"powers of attorney to facilitate voting instructions. We are not supportive of impediments to the","page_number":316,"box":{"x":117,"y":305,"width":706,"height":12}},{"id":"7d6e96de-c7dd-412d-b137-bdbcda5ed519","block_type":"box","text":"exercise of voting rights such as share-blocking or overly burdensome administrative requirements.","page_number":316,"box":{"x":116,"y":320,"width":742,"height":12}},{"id":"87b64c2f-0dcd-475b-93f6-868af0d33f73","block_type":"box","text":"BIS votes proxies in these situations on a “best-efforts” basis. In addition, BIS may determine that it is","page_number":316,"box":{"x":117,"y":352,"width":758,"height":12}},{"id":"83c5e1be-36cd-496b-bda9-43a5e4d44fce","block_type":"box","text":"generally in the interests of BlackRock’s clients not to vote proxies (or not to vote our full allocation) if","page_number":316,"box":{"x":116,"y":368,"width":755,"height":12}},{"id":"a14fef9d-e234-4b87-a533-45109d082c95","block_type":"box","text":"the costs (including but not limited to opportunity costs associated with share-blocking constraints)","page_number":316,"box":{"x":116,"y":383,"width":734,"height":12}},{"id":"1dc2283d-163c-48b3-ba66-f8d48bd1188a","block_type":"box","text":"associated with exercising a vote are expected to outweigh the benefit the client would derive by voting","page_number":316,"box":{"x":116,"y":399,"width":770,"height":12}},{"id":"30e167e5-c5b6-4c96-920b-38342560c9c2","block_type":"box","text":"on the proposal.","page_number":316,"box":{"x":116,"y":414,"width":125,"height":12}},{"id":"93dadbc8-c0c0-41bd-8523-05db0c70715a","block_type":"box","text":"CONFLICTS MANAGEMENT POLICIES AND PROCEDURES","page_number":316,"box":{"x":265,"y":454,"width":475,"height":10}},{"id":"227b9a44-9d96-4afe-a0e1-e7d0b731a60b","block_type":"box","text":"BIS is a dedicated function whose responsibilities are separate from BlackRock’s sales, business","page_number":316,"box":{"x":117,"y":486,"width":724,"height":12}},{"id":"b230cb13-5e3b-44c8-b94f-69204ae9d99a","block_type":"box","text":"partnership or enterprise-level vendor management activities.","page_number":316,"box":{"x":117,"y":501,"width":460,"height":12}},{"id":"a905e47f-f553-4b99-b446-3ead0ace4b87","block_type":"box","text":"BlackRock maintains policies and procedures that are designed to prevent undue influence on BIS’","page_number":316,"box":{"x":117,"y":533,"width":739,"height":12}},{"id":"bef86726-73a1-44cc-9941-5f2fc862c84a","block_type":"box","text":"proxy voting activity. Such influence might stem from any relationship between the investee company","page_number":316,"box":{"x":117,"y":549,"width":755,"height":12}},{"id":"7032f830-3281-459e-a7d6-a92e054fad26","block_type":"box","text":"(or any shareholder proponent or dissident shareholder) and BlackRock, BlackRock’s affiliates, a Fund","page_number":316,"box":{"x":117,"y":564,"width":766,"height":12}},{"id":"3ff62f6a-2046-4ad5-b773-89f7b0621116","block_type":"box","text":"or a Fund’s affiliates, or BlackRock employees.","page_number":316,"box":{"x":116,"y":580,"width":354,"height":12}},{"id":"908d23aa-92a5-4688-be0d-871b7204f179","block_type":"box","text":"For information on how BIS manages conflicts of interest, please see our disclosure.","page_number":316,"box":{"x":117,"y":611,"width":630,"height":13}},{"id":"ac40b694-9267-4815-9667-992678d6d86c","block_type":"box","text":"SECURITIES LENDING","page_number":316,"box":{"x":410,"y":643,"width":185,"height":10}},{"id":"6d21ae89-0d72-4a61-b10e-d119e1376cc3","block_type":"box","text":"When authorized, BlackRock acts as a securities lending agent on behalf of its clients. Lending","page_number":316,"box":{"x":116,"y":675,"width":704,"height":12}},{"id":"153f3815-e42e-44e3-8481-986f2c3d05a4","block_type":"box","text":"securities enables BlackRock to increase the returns in clients’ portfolios, and BlackRock’s lending","page_number":316,"box":{"x":116,"y":690,"width":729,"height":13}},{"id":"d8d792b0-e0ff-44c6-99c7-b88ce8b4d1b7","block_type":"box","text":"agreements allow it to recall securities out on loan at any time. BlackRock (or any other lender) does","page_number":316,"box":{"x":116,"y":706,"width":746,"height":12}},{"id":"d00c8998-3971-4dc5-bcb5-90caf5579464","block_type":"box","text":"not retain voting rights for securities out on loan. Entitlements associated with the lent securities","page_number":316,"box":{"x":117,"y":721,"width":709,"height":13}},{"id":"b9411110-6918-44be-83f5-71db4a4cc142","block_type":"box","text":"(dividends, coupons, etc.), while on loan are paid back to the lender of the security as stipulated in","page_number":316,"box":{"x":117,"y":737,"width":727,"height":12}},{"id":"53d21cd3-8844-4d03-a371-4f72f8e98f07","block_type":"box","text":"industry standard legal agreements.","page_number":316,"box":{"x":117,"y":753,"width":265,"height":12}},{"id":"28344fc4-fe9b-4e74-96c0-c7c21e5834ec","block_type":"box","text":"With regard to the relationship between securities lending and proxy voting, BlackRock cannot vote","page_number":316,"box":{"x":116,"y":784,"width":735,"height":12}},{"id":"2e257325-2185-4c90-ae86-691ac9c44a3d","block_type":"box","text":"shares on loan and may determine to recall them for voting, as guided by our fiduciary duty as an asset","page_number":316,"box":{"x":116,"y":800,"width":767,"height":12}},{"id":"7f5970cc-54a6-4fd6-9f48-c5467d782fc1","block_type":"box","text":"manager to our clients in helping them achieve their investment goals. 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Under the","page_number":323,"box":{"x":522,"y":622,"width":357,"height":12}},{"id":"a55cb0ab-f82d-42f4-9639-9cd034c92b90","block_type":"box","text":"Guidelines, the dedicated team makes decisions on how to engage companies and vote proxies","page_number":323,"box":{"x":150,"y":637,"width":688,"height":12}},{"id":"794d6e6e-edce-40b8-bf76-b675ee80446a","block_type":"box","text":"independently, based on its professional judgment of t","page_number":323,"box":{"x":150,"y":653,"width":379,"height":12}},{"id":"42deab60-1d41-40e3-914d-bc9ee7b3507a","block_type":"box","text":"the priorities and outcomes most aligned with","page_number":323,"box":{"x":529,"y":653,"width":326,"height":12}},{"id":"c3c26348-a14a-48a4-9e12-a72564af579b","block_type":"box","text":"participating clients’ investment objectives.","page_number":323,"box":{"x":150,"y":669,"width":300,"height":11}},{"id":"e3676f38-d731-4896-9341-374fc2f11cba","block_type":"box","text":"VOTING APPROACH UNDER THE GUIDELINES","page_number":323,"box":{"x":306,"y":707,"width":375,"height":10}},{"id":"a37109e6-643d-4266-8057-1de51d4d59e2","block_type":"box","text":"12","page_number":323,"box":{"x":682,"y":707,"width":11,"height":6}},{"id":"83dbdd84-2f35-4133-87c1-3a688eb83027","block_type":"box","text":"When evaluating each voting item across management or shareholder proposals, the dedicated team","page_number":323,"box":{"x":116,"y":738,"width":752,"height":12}},{"id":"81ed45ce-5426-411a-8424-634338c88527","block_type":"box","text":"applies a case-by-case approach that reflects the uneven pace of the low-carbon transition across","page_number":323,"box":{"x":116,"y":754,"width":728,"height":12}},{"id":"0dcfa4b6-3090-48cf-a66f-cc686c4b8252","block_type":"box","text":"sectors and markets, and acknowledges the distinction between what company management can","page_number":323,"box":{"x":116,"y":769,"width":723,"height":12}},{"id":"ca62aeec-798c-4cc6-b983-7e46de8fa388","block_type":"box","text":"influence and what lies beyond its control. 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As a","page_number":324,"box":{"x":116,"y":227,"width":740,"height":12}},{"id":"3e8a8409-35bc-44ab-91ff-2425f7c58010","block_type":"box","text":"general point, the team looks to companies that are important to the transition to a low-carbon","page_number":324,"box":{"x":116,"y":242,"width":702,"height":12}},{"id":"d7d8402a-552a-4e8a-8396-d02e59a6e934","block_type":"box","text":"economy to explain the strategy and governance frameworks that they have determined most","page_number":324,"box":{"x":116,"y":258,"width":700,"height":12}},{"id":"5bb7b8a0-9225-4930-873b-9da3e99a496d","block_type":"box","text":"appropriate, which may include:","page_number":324,"box":{"x":116,"y":273,"width":241,"height":12}},{"id":"66511db9-5c42-44e0-9321-e242cac4ea81","block_type":"box","text":"(1) a low-carbon transition strategy to demonstrate their alignment with the ambition to limit","page_number":324,"box":{"x":150,"y":304,"width":688,"height":12}},{"id":"46952d59-8aa5-42e4-a81f-3820755e148c","block_type":"box","text":"average global temperature rise to 1.5°C above pre-industrial levels. This would typically","page_number":324,"box":{"x":184,"y":320,"width":661,"height":12}},{"id":"15b1ee2d-9967-45f2-a07a-92612b72d9dd","block_type":"box","text":"include a long-term strategy to achieve net-zero GHG emissions by 2050, with appropriate","page_number":324,"box":{"x":184,"y":335,"width":676,"height":12}},{"id":"17c400c9-ea2d-49ae-822b-76abd334b84f","block_type":"box","text":"near- and medium-term milestones to assess their progress.","page_number":324,"box":{"x":184,"y":351,"width":453,"height":12}},{"id":"9456ce23-c39d-4d43-8d98-623ab2325f3c","block_type":"box","text":"(2) low-carbon transition-related reporting. Standardized disclosure of sustainability-related data","page_number":324,"box":{"x":150,"y":374,"width":724,"height":12}},{"id":"3fc94464-b456-484a-b7e3-f9bfb8c5d54f","block_type":"box","text":"supports investors in making informed decisions. The International Sustainability Standards","page_number":324,"box":{"x":184,"y":389,"width":683,"height":12}},{"id":"bf3d3022-ddbd-44a0-a460-48c684b78c9c","block_type":"box","text":"Board (ISSB) standards, IFRS S1 and S2, represent one such approach to standardization","page_number":324,"box":{"x":184,"y":405,"width":678,"height":12}},{"id":"dcbaf407-0f35-493d-87ca-865f8f6aaaa8","block_type":"box","text":"that the dedicated team finds useful in its analysis.","page_number":324,"box":{"x":183,"y":420,"width":374,"height":12}},{"id":"1b913a25-e047-469e-98f7-af3b0623efac","block_type":"box","text":"14","page_number":324,"box":{"x":559,"y":420,"width":11,"height":7}},{"id":"9517331a-52ac-4a44-a0e1-e2f6f46eb552","block_type":"box","text":",","page_number":324,"box":{"x":572,"y":428,"width":8,"height":4}},{"id":"66d4d563-849c-4a87-846a-24292a695155","block_type":"box","text":"15","page_number":324,"box":{"x":581,"y":420,"width":11,"height":7}},{"id":"e043863d-8c7c-442a-a325-0609816a14a3","block_type":"box","text":"IFRS S1 addresses the general","page_number":324,"box":{"x":592,"y":420,"width":244,"height":12}},{"id":"a42a5dfb-7f00-42d6-8b25-298d5f82e44b","block_type":"box","text":"requirements of sustainability reporting and IFRS S2 sets out the disclosures that provide","page_number":324,"box":{"x":184,"y":436,"width":667,"height":12}},{"id":"aebe9579-2fc9-4784-812e-bb6cfbd0e0bd","block_type":"box","text":"investors with decision-useful information about a company’s most significant climate- and","page_number":324,"box":{"x":184,"y":451,"width":674,"height":12}},{"id":"f70199d1-f0af-4f01-8f1b-b018dd9fb898","block_type":"box","text":"low-carbon transition-related risks and opportunities. This includes receiving independent,","page_number":324,"box":{"x":184,"y":467,"width":671,"height":12}},{"id":"1a914895-6c3a-4483-8864-949e1b129cf4","block_type":"box","text":"third-party assurances, as audit and assurance standards are developed.","page_number":324,"box":{"x":183,"y":482,"width":549,"height":12}},{"id":"ad03f4d0-1357-4ea7-b2e4-0cc9e09d9c16","block_type":"box","text":"(3) scope 1 and scope 2, and most significant scope 3 GHG emissions.","page_number":324,"box":{"x":150,"y":506,"width":536,"height":12}},{"id":"0db9c908-6550-44d5-a252-b7d51e00f927","block_type":"box","text":"16","page_number":324,"box":{"x":689,"y":506,"width":10,"height":6}},{"id":"c5859054-cfba-4896-b8f4-aec3625552ee","block_type":"box","text":",","page_number":324,"box":{"x":701,"y":514,"width":8,"height":3}},{"id":"932c8341-50c3-44bc-8d18-808169632966","block_type":"box","text":"17","page_number":324,"box":{"x":710,"y":506,"width":11,"height":6}},{"id":"a1056734-23e1-4d6d-a029-d3e0883d3144","block_type":"box","text":"In addition, the","page_number":324,"box":{"x":721,"y":506,"width":120,"height":11}},{"id":"662333bb-5b64-40ef-93ad-8e4338991b57","block_type":"box","text":"dedicated team looks to companies to disclose their emissions reduction targets for scope 1","page_number":324,"box":{"x":184,"y":521,"width":687,"height":12}},{"id":"24814f8e-8f12-4eba-b93b-6a011fc324dd","block_type":"box","text":"and 2 emissions, science-based where possible. The team welcomes disclosure of targets or","page_number":324,"box":{"x":184,"y":537,"width":695,"height":12}},{"id":"87372501-33ce-4ae7-b775-367c2e019f6c","block_type":"box","text":"13","page_number":324,"box":{"x":144,"y":572,"width":8,"height":5}},{"id":"cefc28df-2ff2-4ed0-abfc-4b04c33a5337","block_type":"box","text":"Given data and measurement limitations, companies may need to provide estimated GHG emissions where reporting","page_number":324,"box":{"x":170,"y":572,"width":695,"height":10}},{"id":"f650eb7e-5008-412b-b175-bd8f087af2b2","block_type":"box","text":"methodologies are nascent. In addition, certain disclosures related to a company’s plans for adapting their business","page_number":324,"box":{"x":170,"y":585,"width":686,"height":10}},{"id":"1ee8001d-d076-4a26-b82f-7c05399861ef","block_type":"box","text":"models through the low-carbon transition may require forward-looking statements.","page_number":324,"box":{"x":170,"y":598,"width":485,"height":10}},{"id":"07a93dee-cac2-4481-8aa9-cd518471b5c1","block_type":"box","text":"14","page_number":324,"box":{"x":144,"y":614,"width":8,"height":4}},{"id":"997c683b-8d39-418f-8a90-03b65dfcfeaa","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Reporting Standards (IFRS)","page_number":324,"box":{"x":170,"y":613,"width":666,"height":10}},{"id":"b43b8a36-1ffa-49bf-8ed1-f0e343d8cf36","block_type":"box","text":"Foundation. The standards build on the Task Force on Climate-related Financial Disclosures (TCFD) framework and the","page_number":324,"box":{"x":171,"y":626,"width":712,"height":10}},{"id":"006116f4-f01c-41ec-9f96-d289bf00f206","block_type":"box","text":"standards and metrics developed by the Sustainability Accounting Standards Board (SASB), which have both","page_number":324,"box":{"x":170,"y":639,"width":649,"height":10}},{"id":"dc76d106-16d8-41e0-8e6f-1d93e6beb3bd","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":324,"box":{"x":170,"y":652,"width":674,"height":10}},{"id":"b11dc5ca-caf0-4cfe-b849-b664478cbcd0","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":324,"box":{"x":170,"y":665,"width":647,"height":10}},{"id":"6b39b793-cf4b-44e7-a906-5ffcbf3e0bb6","block_type":"box","text":"Disclosures.” Websites accessed in December 2025.","page_number":324,"box":{"x":171,"y":678,"width":312,"height":8}},{"id":"207b3459-065c-4b38-9339-193c25d3891f","block_type":"box","text":"15","page_number":324,"box":{"x":144,"y":694,"width":8,"height":5}},{"id":"c4c1627d-8a6e-4027-a72b-dfaf35712496","block_type":"box","text":"A number of jurisdictions are consulting on adopting the standards issued to date or have already committed to doing","page_number":324,"box":{"x":170,"y":694,"width":694,"height":9}},{"id":"a914c6e9-c913-410e-9680-2e24dfcb39e6","block_type":"box","text":"so. BIS does not mandate any specific disclosure framework companies should use, and recognize that some","page_number":324,"box":{"x":170,"y":706,"width":651,"height":10}},{"id":"1c88f350-8e64-4b19-b5fd-d71aabb3dd9e","block_type":"box","text":"companies may report using different standards, some of which may be required by regulation. In such cases, we ask","page_number":324,"box":{"x":170,"y":719,"width":698,"height":10}},{"id":"8ae43d85-4847-419b-ba01-f24e610d3a58","block_type":"box","text":"that companies highlight the metrics that are industry- or company-specific. We also recognize that companies may be","page_number":324,"box":{"x":170,"y":732,"width":703,"height":10}},{"id":"958a04e9-674a-4faf-8373-96f708b3af68","block_type":"box","text":"phasing in reporting over several years. We do not prescribe timelines regarding when companies should make","page_number":324,"box":{"x":170,"y":745,"width":661,"height":10}},{"id":"e60707cf-787e-4f7a-affb-459e784f2b60","block_type":"box","text":"sustainability-related disclosures but appreciate it when companies produce them sufficiently in advance of their","page_number":324,"box":{"x":170,"y":758,"width":664,"height":10}},{"id":"0a316f4f-62e7-4bbe-966f-dce794bd43cc","block_type":"box","text":"shareholder meeting, to the best of their abilities, to provide investors with time to assess the data and make informed","page_number":324,"box":{"x":170,"y":771,"width":698,"height":10}},{"id":"450618cf-c9c3-473c-8602-ff93f1bf8abf","block_type":"box","text":"voting decisions.","page_number":324,"box":{"x":170,"y":784,"width":98,"height":10}},{"id":"c243723a-368c-41b8-bdd9-a259f391a4d9","block_type":"box","text":"16","page_number":324,"box":{"x":144,"y":800,"width":8,"height":4}},{"id":"5083dc63-9b4b-4641-87a5-689192de20ca","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":324,"box":{"x":171,"y":799,"width":685,"height":10}},{"id":"7a33f32f-1c92-439b-ae02-6efccde3998c","block_type":"box","text":"paper: FTSE Russel, “Scope for improvement: Solving the Scope 3 conundrum,” January 2024, accessed in December","page_number":324,"box":{"x":170,"y":812,"width":708,"height":10}},{"id":"12e4f85d-5388-43ef-8897-3a14e1e82dea","block_type":"box","text":"2025.","page_number":324,"box":{"x":170,"y":825,"width":32,"height":8}},{"id":"24cf3b5a-d15c-4d5a-8ba4-6d42d083e20e","block_type":"box","text":"17","page_number":324,"box":{"x":144,"y":841,"width":8,"height":5}},{"id":"67a18ab4-f5f0-4b39-ae88-4f2267d24484","block_type":"box","text":"Under this policy, the dedicated team looks for GHG emissions disclosures to be aligned with the Greenhouse Gas","page_number":324,"box":{"x":171,"y":841,"width":680,"height":9}},{"id":"7d5d3497-338b-423e-916a-758f2ad757f4","block_type":"box","text":"Protocol (GHG Protocol). The Protocol Standards and Guidance are currently being updated to ensure they continue to","page_number":324,"box":{"x":171,"y":854,"width":706,"height":9}},{"id":"bb7dd8fc-bc96-42d0-a2bf-18f451d9efb6","block_type":"box","text":"provide “a rigorous and credible accounting foundation for businesses to measure, plan and track progress toward","page_number":324,"box":{"x":170,"y":867,"width":677,"height":9}},{"id":"4014f668-a2bd-4ea1-a7a3-de7cdd73ab49","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":324,"box":{"x":170,"y":880,"width":650,"height":9}},{"id":"4e2a546d-278e-4ec3-ba5e-39044ab548ba","block_type":"box","text":"BlackRock Investment Stewardship","page_number":324,"box":{"x":117,"y":909,"width":262,"height":11}},{"id":"25ad5f00-2c51-4cc3-ba9b-17d682ff3ac8","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines |","page_number":324,"box":{"x":490,"y":909,"width":375,"height":11}},{"id":"9d134238-1f1b-433d-a519-869e2d2adcce","block_type":"box","text":"6","page_number":324,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"8ea12880-018e-415a-a0a2-bbfda28b1450","block_type":"box","text":"NM1026U-6004382-324/605","page_number":324,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"97cdb9fb-13f2-4f07-be50-e5715ed61f1c","block_type":"box","text":"indicative goals, where companies have set them, for scope 3 emissions reductions. 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While we do not believe","page_number":325,"box":{"x":183,"y":211,"width":672,"height":12}},{"id":"db9cf046-b5b0-4d39-9315-76df41130c69","block_type":"box","text":"companies should be required to enforce emissions reduction targets outside of their control,","page_number":325,"box":{"x":184,"y":227,"width":693,"height":12}},{"id":"7543340d-857b-4614-a62c-3bd84a067116","block_type":"box","text":"where relevant, we look for disclosures on how the company approaches the low-carbon","page_number":325,"box":{"x":183,"y":242,"width":662,"height":12}},{"id":"d3b9a602-2d32-48bd-8fd2-cf3fb093e123","block_type":"box","text":"transition in these cases. This may include plans and targets to grow businesses that","page_number":325,"box":{"x":183,"y":258,"width":636,"height":12}},{"id":"31c54a9b-5dd8-44e5-b544-10c36fe50e88","block_type":"box","text":"contribute to real world decarbonization, forward-looking capital or procurement allocation","page_number":325,"box":{"x":184,"y":273,"width":670,"height":12}},{"id":"d1207769-b5a1-4450-9038-08b3cb3e350d","block_type":"box","text":"plans to net-zero aligned activities or suppliers, and strategies to mitigate material transition","page_number":325,"box":{"x":184,"y":289,"width":684,"height":12}},{"id":"4981e2db-a445-4f21-9a11-bc232f6a1ece","block_type":"box","text":"risks.","page_number":325,"box":{"x":184,"y":304,"width":43,"height":10}},{"id":"9dd49c74-b59b-4d9c-b339-70b17c19715b","block_type":"box","text":"(4) where relevant, disclosures that describe the company’s exposure to climate-related physical","page_number":325,"box":{"x":150,"y":327,"width":729,"height":12}},{"id":"d63d9580-7b16-4f58-a6d6-b20aca1c3a57","block_type":"box","text":"risks – such as acute risks from extreme weather events or chronic risks from long-term shifts","page_number":325,"box":{"x":184,"y":343,"width":699,"height":12}},{"id":"56a60ae9-0440-4a69-957b-29d8dcfac582","block_type":"box","text":"in climate patterns – and how these risks could reasonably be expected to affect the","page_number":325,"box":{"x":184,"y":358,"width":629,"height":12}},{"id":"e467765c-e888-4898-8f9e-8a36b127ef3b","block_type":"box","text":"company’s operations, assets, or supply chains.","page_number":325,"box":{"x":184,"y":374,"width":361,"height":12}},{"id":"8fbe69c2-2edd-4a76-9c45-7ba2972e80c7","block_type":"box","text":"Transition plans","page_number":325,"box":{"x":118,"y":405,"width":132,"height":12}},{"id":"f6ae223a-7ae8-4293-843d-e1623a8bb57a","block_type":"box","text":"Some companies have published transition plans outlining how they intend to implement their","page_number":325,"box":{"x":116,"y":436,"width":698,"height":12}},{"id":"ceac787a-526c-446c-aee9-5848e96222c2","block_type":"box","text":"low-carbon transition strategies. As defined by the ISSB, a transition plan “lays out the entity’s targets,","page_number":325,"box":{"x":117,"y":451,"width":761,"height":12}},{"id":"55a431a8-c046-4b17-9968-fa367ffa6b31","block_type":"box","text":"actions or resources for its transition towards a lower-carbon economy, including actions such as","page_number":325,"box":{"x":116,"y":467,"width":724,"height":12}},{"id":"0f88ad37-7d8e-405b-a60c-2aaa1b78f9f9","block_type":"box","text":"reducing its greenhouse gas emissions” (see Appendix 1).","page_number":325,"box":{"x":117,"y":482,"width":430,"height":12}},{"id":"74e4e42a-80fd-4404-bb18-24fd9abbda5f","block_type":"box","text":"19","page_number":325,"box":{"x":550,"y":482,"width":10,"height":7}},{"id":"6fc40b1c-d1cd-42ec-bc20-0ccd07604a9d","block_type":"box","text":"Work is also underway in a number of jurisdictions on establishing a common approach in a market to","page_number":325,"box":{"x":116,"y":513,"width":760,"height":12}},{"id":"19fe09a7-9be6-4679-a26e-9aaf86612b66","block_type":"box","text":"corporate transition plans.","page_number":325,"box":{"x":116,"y":529,"width":192,"height":12}},{"id":"e2d734b8-f539-4a4e-9799-fa0cab273ccb","block_type":"box","text":"20","page_number":325,"box":{"x":310,"y":529,"width":11,"height":6}},{"id":"1a1b8f5e-024a-40e0-933a-774e33ebc16b","block_type":"box","text":"Recent guidance from the ISSB on disclosures about transition plans","page_number":325,"box":{"x":321,"y":529,"width":523,"height":12}},{"id":"44c3022c-2b3e-4004-820f-2a8c07c35382","block_type":"box","text":"highlights the convergence of reporting approaches.","page_number":325,"box":{"x":117,"y":544,"width":391,"height":12}},{"id":"7af1e5a8-ee01-4ca3-9adc-86a8a3b6bcde","block_type":"box","text":"While the preparation of a transition plan, or lack thereof, is not, in itself, a voting issue, these","page_number":325,"box":{"x":116,"y":575,"width":697,"height":12}},{"id":"35c959d7-f51f-423d-9e44-667b5473b784","block_type":"box","text":"disclosures typically provide valuable insights that inform the dedicated team’s approach to engaging","page_number":325,"box":{"x":116,"y":591,"width":754,"height":12}},{"id":"8835d05c-e6e0-4037-bb69-c483ca361afa","block_type":"box","text":"and voting on matters related to climate and transition risks on behalf of in-scope funds and accounts.","page_number":325,"box":{"x":116,"y":606,"width":761,"height":12}},{"id":"58351113-73d8-4d70-b4db-e4fe641d7859","block_type":"box","text":"Boards and directors","page_number":325,"box":{"x":117,"y":638,"width":173,"height":9}},{"id":"8a3790a4-3195-42bb-9348-a3f898f92f38","block_type":"box","text":"An effective and well-functioning board that has appropriate governance structures to facilitate","page_number":325,"box":{"x":116,"y":668,"width":699,"height":12}},{"id":"e73b0dd4-f03c-4321-adff-d2a978a46608","block_type":"box","text":"oversight of a company’s management and strategic initiatives is critical to the company’s ability to","page_number":325,"box":{"x":116,"y":684,"width":731,"height":12}},{"id":"1485c12e-1919-4923-8969-d6c12a5fafb6","block_type":"box","text":"18","page_number":325,"box":{"x":144,"y":722,"width":8,"height":5}},{"id":"e7d9967b-c00a-4e97-adf3-276d6e493155","block_type":"box","text":"The dedicated team does not believe the purpose of scope 3 disclosure requirements should be to push publicly traded","page_number":325,"box":{"x":170,"y":722,"width":707,"height":10}},{"id":"729f3a91-3579-43d9-960e-62d520d48e6d","block_type":"box","text":"companies into the role of enforcing emission reduction targets outside of their control. Given methodological","page_number":325,"box":{"x":170,"y":735,"width":645,"height":10}},{"id":"cac83144-209c-4070-9b0e-613bd8197ba0","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":325,"box":{"x":170,"y":748,"width":686,"height":9}},{"id":"1a79720b-4957-40b8-b1a6-e7c1b9568876","block_type":"box","text":"useful when companies focus their disclosures on those of the fifteen scope 3 GHG Protocol categories that are","page_number":325,"box":{"x":170,"y":761,"width":663,"height":9}},{"id":"106b9545-6a3b-49bf-a481-c3f95656293c","block_type":"box","text":"material to their business models.","page_number":325,"box":{"x":170,"y":774,"width":199,"height":7}},{"id":"9f8661e0-c838-415b-8502-43fce67de173","block_type":"box","text":"19","page_number":325,"box":{"x":144,"y":789,"width":8,"height":5}},{"id":"42017f1b-ed48-4c53-a8a6-4e6b4583b564","block_type":"box","text":"International Financial Reporting Standards, “IFRS S2: Climate-related Disclosures,” June 2023, accessed in December","page_number":325,"box":{"x":171,"y":789,"width":712,"height":10}},{"id":"dc60ec05-d446-40e3-bc71-9a01402bf045","block_type":"box","text":"2025.","page_number":325,"box":{"x":170,"y":802,"width":32,"height":8}},{"id":"b0488a57-fee4-48a1-8d35-ff612feca199","block_type":"box","text":"20","page_number":325,"box":{"x":143,"y":815,"width":9,"height":5}},{"id":"49129d5c-a59c-4ce3-9516-e60ab2840c99","block_type":"box","text":"More companies are developing such plans, and public policymakers in certain markets are signaling their intentions to","page_number":325,"box":{"x":171,"y":815,"width":705,"height":10}},{"id":"98d895ce-85bf-4e9b-b6b7-9ae157f8d3a7","block_type":"box","text":"require them or already have requirements in place, such as Australia, Brazil, and the European Union (please see the","page_number":325,"box":{"x":170,"y":828,"width":704,"height":10}},{"id":"e85eb355-2b2d-4ae5-b4b2-6cd3f4d3d6a7","block_type":"box","text":"International Transition Plan Network for information). 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The Guidelines consider the whole board to","page_number":326,"box":{"x":150,"y":149,"width":719,"height":12}},{"id":"c8e67b84-6c45-4c9e-bc69-f9ef658f3cad","block_type":"box","text":"have responsibility for oversight of the company’s long-term strategy, including those aspects","page_number":326,"box":{"x":150,"y":165,"width":696,"height":12}},{"id":"2fb5b862-6428-40db-9488-44f8d8f33db2","block_type":"box","text":"related to the transition to a low-carbon economy.","page_number":326,"box":{"x":150,"y":180,"width":373,"height":12}},{"id":"641da905-651a-4dec-949f-56b2514cac8e","block_type":"box","text":"• Management has established a robust low-carbon transition framework and long-term strategy,","page_number":326,"box":{"x":125,"y":203,"width":735,"height":12}},{"id":"39d99baf-3fd3-404b-8257-399e8a20355c","block_type":"box","text":"with clear accountability for delivery by senior executives.","page_number":326,"box":{"x":149,"y":219,"width":432,"height":12}},{"id":"40893a5d-0da1-4d5d-a542-372e1bec5c8d","block_type":"box","text":"• The capital management strategy explains how the company allocates investments to (traditional","page_number":326,"box":{"x":125,"y":242,"width":749,"height":12}},{"id":"13d4c930-8b23-4a15-8205-6f3a208c1db7","block_type":"box","text":"and next generation) business lines and innovation, and returns cash to shareholders, consistent","page_number":326,"box":{"x":150,"y":258,"width":724,"height":12}},{"id":"4800c602-4bdb-4045-a76f-3bf6304f0d5a","block_type":"box","text":"with the company’s stated low-carbon transition strategy.","page_number":326,"box":{"x":149,"y":273,"width":428,"height":12}},{"id":"52650dca-36d4-42b0-86e0-a158b29d2a11","block_type":"box","text":"• The climate and low-carbon transition risks most likely to significantly impact the business are","page_number":326,"box":{"x":125,"y":296,"width":724,"height":12}},{"id":"6b754eca-50f1-4d5b-b261-0823434b2c81","block_type":"box","text":"integrated into the company’s enterprise risk management processes and reporting.","page_number":326,"box":{"x":150,"y":312,"width":627,"height":12}},{"id":"40b5196f-5d28-445a-bf6e-64675baf4814","block_type":"box","text":"• The company has set scope 1 and 2 GHG emissions reduction targets, science-based and","page_number":326,"box":{"x":125,"y":335,"width":704,"height":12}},{"id":"81ad3a0c-9214-42a4-b5c7-5760adc3838e","block_type":"box","text":"independently verified where possible, against a baseline, that are consistent with the ambition to","page_number":326,"box":{"x":150,"y":351,"width":726,"height":12}},{"id":"68809895-9911-42bf-b7e7-c1e42195bd50","block_type":"box","text":"limit average global temperature rise to no more than 1.5°C above pre-industrial levels.","page_number":326,"box":{"x":150,"y":366,"width":651,"height":12}},{"id":"2edf3a0c-d305-4e4e-aa6b-c70f1d1ab215","block_type":"box","text":"• There is a clear link between the company’s scope 1 and 2 GHG emissions reduction targets over","page_number":326,"box":{"x":125,"y":389,"width":757,"height":12}},{"id":"7ab4c101-899f-4f1b-895b-ed8dad1334fa","block_type":"box","text":"time and its long-term low-carbon transition strategy.","page_number":326,"box":{"x":150,"y":405,"width":395,"height":12}},{"id":"8b96a5cc-bd71-4016-88b0-0644d2ba3835","block_type":"box","text":"• The company is monitoring its most significant scope 3 emissions and disclosing these where it is","page_number":326,"box":{"x":125,"y":428,"width":754,"height":12}},{"id":"1810059f-1e9f-4a8b-8cb6-bdae29942729","block_type":"box","text":"confident in the data. Given forthcoming regulatory requirements in certain jurisdictions, some","page_number":326,"box":{"x":150,"y":444,"width":700,"height":12}},{"id":"f9c03a05-cb0c-48af-b00a-0dc32df6b35a","block_type":"box","text":"companies are voluntarily disclosing scope 3 emissions reductions targets and plans, setting out","page_number":326,"box":{"x":150,"y":459,"width":720,"height":12}},{"id":"a2d1ea94-19ae-44e5-80d4-a02940f09ec2","block_type":"box","text":"how they are working on decarbonization with the different constituents in their value chain.","page_number":326,"box":{"x":150,"y":475,"width":682,"height":12}},{"id":"44d799b3-39cf-4270-9824-02f2399d6427","block_type":"box","text":"21","page_number":326,"box":{"x":833,"y":475,"width":10,"height":6}},{"id":"699d04d7-4a9c-44e4-942b-05c1f253ef79","block_type":"box","text":"• The company’s governance and oversight processes for managing material risks associated with","page_number":326,"box":{"x":125,"y":498,"width":749,"height":12}},{"id":"3c7e792f-5131-4852-a326-f56e110310d4","block_type":"box","text":"corporate political activities including applicable policies and procedures where relevant.","page_number":326,"box":{"x":150,"y":514,"width":652,"height":11}},{"id":"5fdda01d-e792-4805-a0b7-e3ce3b3fcf83","block_type":"box","text":"22","page_number":326,"box":{"x":804,"y":513,"width":11,"height":7}},{"id":"b84462d1-185f-44df-9957-a7de7117d27c","block_type":"box","text":"The","page_number":326,"box":{"x":816,"y":514,"width":38,"height":9}},{"id":"8482ee5e-f86c-4fc2-9c8f-4d0a3e5c9a4b","block_type":"box","text":"dedicated team looks for public policy engagement to be consistent with a company’s stated","page_number":326,"box":{"x":150,"y":529,"width":689,"height":12}},{"id":"6ad02581-82d3-4086-be6a-627508e51cb0","block_type":"box","text":"strategic policy objectives, including those related to the low-carbon transition.","page_number":326,"box":{"x":150,"y":545,"width":584,"height":11}},{"id":"4bbfe2f2-d0ae-4b0f-86df-7995f897e5a3","block_type":"box","text":"Voting against directors over concerns about climate risk","page_number":326,"box":{"x":118,"y":576,"width":463,"height":11}},{"id":"b94eb999-b14e-47f0-aa4d-873130db9038","block_type":"box","text":"In implementing these Guidelines, the dedicated team generally supports non-executive directors","page_number":326,"box":{"x":117,"y":606,"width":726,"height":12}},{"id":"85b13af6-1883-4f88-b10e-c7774c38da05","block_type":"box","text":"standing for election where, in its assessment based on company disclosures and engagement, a","page_number":326,"box":{"x":116,"y":622,"width":729,"height":12}},{"id":"7a2e7bd9-cbcc-4268-82d7-34358e496531","block_type":"box","text":"company is executing on its commitment to align with the transition to a low-carbon economy, as","page_number":326,"box":{"x":116,"y":638,"width":722,"height":11}},{"id":"572227aa-be98-49e1-a975-979036b08cfc","block_type":"box","text":"defined above. Where the dedicated team determines this is not the case, it may vote against the","page_number":326,"box":{"x":116,"y":653,"width":727,"height":12}},{"id":"36e93cf6-cfad-4aea-9e85-756705f56138","block_type":"box","text":"election of one or more directors who the team identifies as having the most responsibility for the issue.","page_number":326,"box":{"x":116,"y":668,"width":766,"height":12}},{"id":"c372edf4-55c2-4d7e-90b2-229f0d01e8fc","block_type":"box","text":"The directors most likely to be in focus are the chair of the board committee with low-carbon transition,","page_number":326,"box":{"x":116,"y":684,"width":759,"height":12}},{"id":"0f562864-352c-4ed3-b578-91352b8bc09f","block_type":"box","text":"climate or sustainability risk oversight responsibilities, other members of the relevant committee, the","page_number":326,"box":{"x":116,"y":699,"width":741,"height":13}},{"id":"c5a304e4-0d14-4b92-a6b3-702925619c5a","block_type":"box","text":"lead independent director or the non-executive chair of the board. In certain markets, the team may","page_number":326,"box":{"x":117,"y":715,"width":736,"height":12}},{"id":"64809408-482a-4b57-bd8e-15f079aa5f9f","block_type":"box","text":"withhold support for the discharge of the supervisory board or equivalent and/or board reports.","page_number":326,"box":{"x":116,"y":730,"width":699,"height":13}},{"id":"1288547d-d435-4451-a2a5-c375283a366f","block_type":"box","text":"23","page_number":326,"box":{"x":817,"y":731,"width":11,"height":6}},{"id":"69482ed5-eac6-474c-b28a-ac5ce4362e86","block_type":"box","text":"21","page_number":326,"box":{"x":143,"y":758,"width":8,"height":5}},{"id":"445cbe5e-6ec2-4604-9ddc-d7620627f7c2","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":326,"box":{"x":171,"y":758,"width":685,"height":10}},{"id":"b52c16da-6b75-4a25-80cb-8e14a659fc6d","block_type":"box","text":"paper “Scope for improvement: Solving the Scope 3 conundrum.” Their research indicates that there are 2-3 material","page_number":326,"box":{"x":170,"y":771,"width":692,"height":10}},{"id":"413c7dd5-81f5-4c68-ab4c-84e551c0a321","block_type":"box","text":"scope 3 GHG emissions categories by sector. The research uses a definition of materiality from the GHG Protocol,","page_number":326,"box":{"x":170,"y":784,"width":679,"height":10}},{"id":"11583d14-7c3a-49f8-8dd2-2ad85afcb769","block_type":"box","text":"which “encourages companies to maintain a representative inventory of the “most significant GHG emissions, that offer","page_number":326,"box":{"x":170,"y":797,"width":706,"height":10}},{"id":"b4a9576e-0518-499f-bb13-532628d1c272","block_type":"box","text":"the most significant GHG reduction opportunities and are most relevant to the company’s business goals.” Website","page_number":326,"box":{"x":170,"y":810,"width":681,"height":9}},{"id":"58311078-54fb-4e63-8d4c-53cb2ced320e","block_type":"box","text":"accessed in December 2025.","page_number":326,"box":{"x":170,"y":823,"width":173,"height":7}},{"id":"2cdae130-229b-4ef4-90a4-cfbcdee359ea","block_type":"box","text":"22","page_number":326,"box":{"x":143,"y":838,"width":9,"height":5}},{"id":"0e15c189-b836-42ec-bfec-dc5d184f5a7c","block_type":"box","text":"Corporate political activities may include lobbying as defined by local regulations, policy engagement (including trade","page_number":326,"box":{"x":170,"y":838,"width":694,"height":10}},{"id":"be1eec2d-7e9a-4362-a5d8-06de496408c1","block_type":"box","text":"association memberships), and corporate political contributions.","page_number":326,"box":{"x":170,"y":851,"width":378,"height":10}},{"id":"3eb4e7b5-4ce7-4108-904b-47e1328d415f","block_type":"box","text":"23","page_number":326,"box":{"x":143,"y":867,"width":9,"height":5}},{"id":"c4b30257-4399-411c-9027-0da0a7219070","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":326,"box":{"x":171,"y":867,"width":661,"height":9}},{"id":"ee6b32fc-8599-4059-aee7-71e39b639cae","block_type":"box","text":"information on a company’s sustainability efforts, operational resilience, or financial condition, among others.","page_number":326,"box":{"x":170,"y":880,"width":643,"height":9}},{"id":"61632907-1744-4c61-92cb-c2abdd160947","block_type":"box","text":"BlackRock Investment Stewardship","page_number":326,"box":{"x":117,"y":909,"width":262,"height":11}},{"id":"588cc422-0b4e-4bda-9272-a9bfe3033593","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines |","page_number":326,"box":{"x":490,"y":909,"width":375,"height":11}},{"id":"6fad6180-c654-4eeb-90b4-01d677a9062a","block_type":"box","text":"8","page_number":326,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"fd9e9a97-b1ca-4fb1-aec0-e2ebc327c858","block_type":"box","text":"NM1026U-6004382-326/605","page_number":326,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b763078c-75eb-4c8f-afdb-8b1f3cc05271","block_type":"box","text":"Where the dedicated team has not supported director elections over climate concerns in a prior year,","page_number":327,"box":{"x":116,"y":87,"width":754,"height":12}},{"id":"8ecce2d8-a86e-4341-8a9e-8ab78673ab43","block_type":"box","text":"and the company has not subsequently made progress towards aligning with the transition to a","page_number":327,"box":{"x":116,"y":103,"width":709,"height":12}},{"id":"1b677e82-c7af-413e-9990-7113aa4c0698","block_type":"box","text":"low-carbon economy, the team may escalate by not supporting the re-election of additional responsible","page_number":327,"box":{"x":117,"y":118,"width":769,"height":12}},{"id":"d0075c64-5fce-49ae-9955-126410cf08c4","block_type":"box","text":"directors.","page_number":327,"box":{"x":116,"y":134,"width":67,"height":9}},{"id":"49fa5d07-3a00-47c6-8a04-926017aa46f2","block_type":"box","text":"24","page_number":327,"box":{"x":185,"y":134,"width":12,"height":6}},{"id":"90533479-1d21-4db6-b797-92db1692ed61","block_type":"box","text":"Management proposals to approve a climate strategy or progress report","page_number":327,"box":{"x":117,"y":165,"width":581,"height":12}},{"id":"f231a29e-9fb0-469c-bf0c-f38511309404","block_type":"box","text":"In certain markets, company management may submit proposals – commonly referred to as “Say on","page_number":327,"box":{"x":117,"y":196,"width":749,"height":12}},{"id":"f04be22e-640f-47a4-98b7-0d0d0a77a1dc","block_type":"box","text":"Climate” – seeking shareholder approval of their climate action plans or progress reports. The","page_number":327,"box":{"x":117,"y":211,"width":700,"height":12}},{"id":"68722cbc-5530-4c89-889a-2442fdb192ba","block_type":"box","text":"Guidelines consider these proposals as a valuable governance mechanism that can enhance","page_number":327,"box":{"x":117,"y":227,"width":696,"height":12}},{"id":"3abf2e66-f68f-44bc-9630-c572b923f8d7","block_type":"box","text":"transparency, accountability, and investors’ understanding of a company’s climate strategy. The","page_number":327,"box":{"x":116,"y":242,"width":716,"height":12}},{"id":"91d80456-7fbe-40de-b36f-54949e2541b5","block_type":"box","text":"dedicated team generally supports management’s climate strategy proposal if, in the team’s","page_number":327,"box":{"x":116,"y":258,"width":687,"height":12}},{"id":"0fbfe851-9bfb-4437-8a7c-130f7abd82dc","block_type":"box","text":"assessment based on these Guidelines, the strategy is aligned with the low-carbon transition. Similarly,","page_number":327,"box":{"x":116,"y":273,"width":772,"height":12}},{"id":"2fd7f15c-721a-4bbf-911f-427d1253c38b","block_type":"box","text":"the dedicated team generally supports management’s proposal on a progress report if the company","page_number":327,"box":{"x":116,"y":289,"width":745,"height":12}},{"id":"470e91e2-2efc-464e-90c5-cecfe6f59338","block_type":"box","text":"has clearly explained its progress against, and any deviations from or changes to, its stated low-carbon","page_number":327,"box":{"x":117,"y":304,"width":770,"height":12}},{"id":"5976841a-1dbf-4076-9c04-64076a5cd1b9","block_type":"box","text":"transition plan and targets.","page_number":327,"box":{"x":116,"y":320,"width":203,"height":12}},{"id":"8aa4d346-4062-430e-bfa4-b26ebc034919","block_type":"box","text":"Shareholder proposals on climate and low-carbon transition matters","page_number":327,"box":{"x":116,"y":351,"width":552,"height":11}},{"id":"a9fd098e-de97-4dce-b64a-1e70492160f7","block_type":"box","text":"In most markets, shareholders can submit proposals to be voted on at a company’s shareholder","page_number":327,"box":{"x":117,"y":382,"width":717,"height":12}},{"id":"f849db16-b23b-4a02-b0df-b62e024b9b45","block_type":"box","text":"meeting, as long as certain requirements are met. 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When the dedicated team votes in support of a","page_number":327,"box":{"x":116,"y":459,"width":748,"height":12}},{"id":"c233af2e-9837-445f-8117-cabc3b116d33","block_type":"box","text":"proposal, it is not necessarily endorsing every element of the proposal or the reasoning, objectives, or","page_number":327,"box":{"x":117,"y":475,"width":759,"height":12}},{"id":"a8c2a676-00ae-43da-93c2-595f669fd8f0","block_type":"box","text":"supporting statement of the proponent.","page_number":327,"box":{"x":116,"y":490,"width":294,"height":12}},{"id":"75c05988-006a-40d9-a681-14e915fab9b7","block_type":"box","text":"In addition to financial materiality, the Guidelines consider the proposal’s relevance to the company’s","page_number":327,"box":{"x":117,"y":521,"width":752,"height":12}},{"id":"a8cefde8-0006-41e8-b6fe-5ffd1ddc35e6","block_type":"box","text":"low-carbon transition strategy and targets. The dedicated team assesses the implications for, and the","page_number":327,"box":{"x":117,"y":537,"width":756,"height":12}},{"id":"bc6d56b3-0ce2-499d-9b8d-a429c430caef","block_type":"box","text":"relevance to, the company’s stated low-carbon transition strategy and targets. Under the Guidelines,","page_number":327,"box":{"x":117,"y":552,"width":749,"height":12}},{"id":"b8ead73d-cdd7-4fd3-9ffb-13efe31314a4","block_type":"box","text":"the team may support shareholder proposals that, for example, ask a company to:","page_number":327,"box":{"x":116,"y":568,"width":615,"height":12}},{"id":"47562eeb-02ee-403d-92e7-9a56a13b332d","block_type":"box","text":"• Publish a business plan, and related disclosures, consistent with the ambition to limit average","page_number":327,"box":{"x":150,"y":599,"width":732,"height":12}},{"id":"89c0d14b-6d1b-4f51-8d9f-04b583f39285","block_type":"box","text":"global temperature rise to no more than 1.5°C above pre-industrial levels","page_number":327,"box":{"x":184,"y":614,"width":546,"height":12}},{"id":"5565f707-58fa-488b-8db5-cecfa22e0b42","block_type":"box","text":"• Align scope 1 and 2 GHG emissions reduction targets to, and/or discuss how their targets","page_number":327,"box":{"x":150,"y":637,"width":704,"height":12}},{"id":"48ee0422-8158-4226-98d9-ad8a511a4f02","block_type":"box","text":"align with, a long-term goal of the company achieving net zero GHG emissions by 2050","page_number":327,"box":{"x":184,"y":653,"width":653,"height":12}},{"id":"f1555c8a-0bc7-4176-b0e2-507d4fa986cc","block_type":"box","text":"• Disclose the categories of scope 3 GHG emissions most significant to a company’s business","page_number":327,"box":{"x":150,"y":676,"width":721,"height":12}},{"id":"12b3329c-f808-4d77-8d2d-cd7a88023a81","block_type":"box","text":"model","page_number":327,"box":{"x":184,"y":692,"width":44,"height":9}},{"id":"c3404d87-c7c6-4bfd-b90d-816811065bf9","block_type":"box","text":"• Improve voluntary disclosures on the alignment of a company’s climate-related corporate","page_number":327,"box":{"x":150,"y":715,"width":693,"height":12}},{"id":"5e61ba44-d791-4b45-96ce-62d201af584a","block_type":"box","text":"political activities with its strategic policy positions, where existing disclosure is insufficient","page_number":327,"box":{"x":184,"y":730,"width":666,"height":13}},{"id":"f2c44748-f9a2-4a95-9419-7f62620ed104","block_type":"box","text":"25","page_number":327,"box":{"x":850,"y":731,"width":11,"height":6}},{"id":"d5bacc8f-a41e-402d-ab7e-260f5ac7256c","block_type":"box","text":"The dedicated team does not support shareholder proposals that seek to constrain board or","page_number":327,"box":{"x":116,"y":762,"width":682,"height":11}},{"id":"bf82c4cb-402f-439a-9642-a02a73ec9ee9","block_type":"box","text":"management decision-making or direct specific business or strategic decisions.","page_number":327,"box":{"x":117,"y":777,"width":587,"height":12}},{"id":"6d9d1152-465b-4716-8005-0b3c78b625b5","block_type":"box","text":"24","page_number":327,"box":{"x":143,"y":815,"width":9,"height":5}},{"id":"bc030f63-9732-46ac-b31f-838c4e1583cb","block_type":"box","text":"While the dedicated team may escalate voting by not supporting additional management proposals, principally director","page_number":327,"box":{"x":170,"y":815,"width":703,"height":10}},{"id":"d011539f-d468-4342-903f-649bcd042875","block_type":"box","text":"elections, the team does not consider filing shareholder proposals, preannouncing voting intentions or using the media","page_number":327,"box":{"x":170,"y":828,"width":702,"height":10}},{"id":"f94ee8b8-fd6e-413d-b91b-6b50ca286d8d","block_type":"box","text":"to amplify concerns as appropriate courses of action. 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Some companies, in light of their long-term","page_number":328,"box":{"x":117,"y":250,"width":703,"height":12}},{"id":"e25f73a7-eac4-4298-87b9-006d234a9772","block_type":"box","text":"strategy, may decide to include relevant GHG emissions reduction targets or low-carbon transition","page_number":328,"box":{"x":116,"y":265,"width":734,"height":12}},{"id":"cc7dd4ea-4fdc-45b3-a165-8e57f26858be","block_type":"box","text":"related metrics in their incentive plans. In such cases, the dedicated team would engage to understand","page_number":328,"box":{"x":117,"y":281,"width":767,"height":12}},{"id":"f78b103a-d771-4208-b453-af0ce6429640","block_type":"box","text":"the alignment between those metrics and the company’s stated climate strategy. Clear disclosure also","page_number":328,"box":{"x":116,"y":296,"width":763,"height":12}},{"id":"f6da1ff9-b21b-45fd-a57e-26cf749920c4","block_type":"box","text":"helps investors assess whether pay structures are consistent with long-term climate strategy and risk","page_number":328,"box":{"x":117,"y":312,"width":754,"height":12}},{"id":"c00d0aca-7a06-416b-8493-5fb15f03741f","block_type":"box","text":"management.","page_number":328,"box":{"x":117,"y":328,"width":106,"height":11}},{"id":"b6a5fe53-6c1e-4a86-b753-afb05996d0e2","block_type":"box","text":"Auditors and audit-related issues","page_number":328,"box":{"x":116,"y":366,"width":271,"height":10}},{"id":"b2aa2dc0-6b3e-4c75-a007-39da5176e542","block_type":"box","text":"For companies with material climate or transition risks or opportunities in their business models, the","page_number":328,"box":{"x":117,"y":397,"width":742,"height":12}},{"id":"e5d4d37e-e4f4-4759-b0cb-001b105ff14a","block_type":"box","text":"dedicated team is interested in understanding whether the company considers and, if relevant,","page_number":328,"box":{"x":116,"y":413,"width":706,"height":12}},{"id":"b319791e-a228-475a-9ae9-6d2f8f9f6d72","block_type":"box","text":"quantifies, and accounts for material climate-related risks in its financial statements, including if the","page_number":328,"box":{"x":116,"y":428,"width":739,"height":12}},{"id":"392698f0-1636-4f0a-b009-129613e31ac6","block_type":"box","text":"company explains such risks within the context of its audit report. 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The dedicated team does not promote changes in corporate","page_number":328,"box":{"x":116,"y":576,"width":723,"height":11}},{"id":"6c61b42a-5387-47a3-9dc6-3f7e4874fba3","block_type":"box","text":"control or engage in shareholder activism.","page_number":328,"box":{"x":116,"y":591,"width":317,"height":12}},{"id":"600a246a-90e7-48c1-bd67-306f290b02ad","block_type":"box","text":"Other business relevant sustainability-related risks and opportunities","page_number":328,"box":{"x":116,"y":630,"width":560,"height":12}},{"id":"84efd1a8-dd55-4177-9d39-edf9b6ebd9cf","block_type":"box","text":"Climate risk and the transition to a low-carbon economy are interconnected with a number of other","page_number":328,"box":{"x":117,"y":661,"width":730,"height":12}},{"id":"98bc0994-6959-4336-ab18-b8d04b15a7e2","block_type":"box","text":"material sustainability-related risks and opportunities that may be relevant to a company’s business","page_number":328,"box":{"x":117,"y":676,"width":735,"height":12}},{"id":"c8ac27fb-bae5-4a42-be34-9d730e71ce80","block_type":"box","text":"model and long-term financial performance. These include a company’s impacts or dependencies on","page_number":328,"box":{"x":117,"y":692,"width":746,"height":12}},{"id":"4a0bab88-459f-4bef-b2cd-b3df99ffe4c8","block_type":"box","text":"natural capital and key stakeholders.","page_number":328,"box":{"x":117,"y":707,"width":270,"height":12}},{"id":"9429294d-e3b8-46cf-9e44-2ce0771dceb7","block_type":"box","text":"26","page_number":328,"box":{"x":389,"y":707,"width":12,"height":6}},{"id":"5d6b6103-b2e6-4f6d-8a15-7d0294a9961c","block_type":"box","text":"In the context of these Guidelines, the dedicated team may","page_number":328,"box":{"x":407,"y":707,"width":438,"height":12}},{"id":"39e127ca-fcc5-46b3-9092-859d976f33f2","block_type":"box","text":"engage companies to better understand how they are managing the impact on people (e.g.,","page_number":328,"box":{"x":116,"y":723,"width":679,"height":12}},{"id":"6355f1ab-d18f-4a35-8325-5a3fa13d8df3","block_type":"box","text":"employees, suppliers, customers and communities) of any strategic or operational changes they are","page_number":328,"box":{"x":116,"y":738,"width":742,"height":12}},{"id":"43e0e1f3-fd31-4d78-be3c-7bd2b0566d2a","block_type":"box","text":"making in relation to their transition to a low-carbon economy. 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This can be carried out by countries,","page_number":329,"box":{"x":117,"y":339,"width":763,"height":12}},{"id":"21f744c1-66e1-47ad-9deb-386d656bda06","block_type":"box","text":"companies and even individual consumers. Sometimes the concept is understood to include the","page_number":329,"box":{"x":116,"y":355,"width":717,"height":12}},{"id":"19ce9af1-cfc8-4ac0-a3ac-f5fcc0bbb93c","block_type":"box","text":"reduction and elimination of other GHG, e.g., methane.","page_number":329,"box":{"x":117,"y":370,"width":412,"height":12}},{"id":"0c07b72d-2ccf-4109-80aa-e2aa56455e51","block_type":"box","text":"Climate-related risks and opportunities","page_number":329,"box":{"x":116,"y":399,"width":312,"height":12}},{"id":"4e8395ea-bf9c-48ea-ab6d-affc11d69701","block_type":"box","text":": The investment opportunities and risks associated with the","page_number":329,"box":{"x":430,"y":399,"width":448,"height":12}},{"id":"354ffa58-6263-400e-9dac-dc4106ff628b","block_type":"box","text":"transition to a low-carbon economy, including transition risks and opportunities and physical risks and","page_number":329,"box":{"x":116,"y":415,"width":757,"height":12}},{"id":"2ace5331-c664-434c-8d64-a4d99830129b","block_type":"box","text":"opportunities in adapting to physical climate change.","page_number":329,"box":{"x":116,"y":430,"width":394,"height":12}},{"id":"6190c029-5ac3-4656-8712-ccb1902789ac","block_type":"box","text":"Climate-related transition plan","page_number":329,"box":{"x":116,"y":459,"width":241,"height":12}},{"id":"196ad133-56b6-46de-9a78-81187377269f","block_type":"box","text":": “An aspect of an entity’s overall strategy that lays out the entity’s","page_number":329,"box":{"x":360,"y":459,"width":492,"height":12}},{"id":"fcab07ff-2319-4878-85fe-c9b75fc99f9a","block_type":"box","text":"targets, actions or resources for its transition towards a lower-carbon economy, including actions such","page_number":329,"box":{"x":116,"y":474,"width":762,"height":12}},{"id":"5d40c6d4-363f-4ca2-9c7b-5bff3064eede","block_type":"box","text":"as reducing its greenhouse gas emissions.”","page_number":329,"box":{"x":116,"y":490,"width":323,"height":12}},{"id":"532d8490-9928-400e-9789-fe46122bdeef","block_type":"box","text":"27","page_number":329,"box":{"x":440,"y":490,"width":11,"height":6}},{"id":"dfd354f7-54f5-42c6-aabd-67796411b38f","block_type":"box","text":"Science-based GHG emissions reduction targets","page_number":329,"box":{"x":116,"y":519,"width":389,"height":12}},{"id":"a1ff3695-69f6-4538-b292-c21921f6f8d1","block_type":"box","text":": Targets that “…are in line with what the latest","page_number":329,"box":{"x":507,"y":519,"width":351,"height":12}},{"id":"fee357d8-df99-40de-a080-1a5047fedc67","block_type":"box","text":"climate science deems necessary to meet the goals of the Paris Agreement – limiting global warming","page_number":329,"box":{"x":116,"y":534,"width":756,"height":12}},{"id":"1946d4a1-f75c-4521-9d3e-492dd4a16a72","block_type":"box","text":"to 1.5°C above pre-industrial levels. Science-based targets give companies a clearly defined path to","page_number":329,"box":{"x":116,"y":550,"width":747,"height":12}},{"id":"5a60edb0-03ec-4e42-9cd0-b6b529777670","block_type":"box","text":"reduce GHG emissions in line with limiting global warming to 1.5°C. They define how much and how","page_number":329,"box":{"x":117,"y":565,"width":748,"height":12}},{"id":"e6d12151-b5e1-424e-939c-a082d95f8462","block_type":"box","text":"quickly a business must reduce its emissions to be in line with the Paris Agreement goals.”","page_number":329,"box":{"x":116,"y":581,"width":673,"height":12}},{"id":"4e83a730-7345-4c93-8c41-68c4d52c22d7","block_type":"box","text":"28","page_number":329,"box":{"x":790,"y":581,"width":11,"height":6}},{"id":"07d39b43-0b1d-422f-b831-d36898367d95","block_type":"box","text":"Scope 1:","page_number":329,"box":{"x":116,"y":609,"width":68,"height":12}},{"id":"a8b45206-ae1a-43f6-ab5b-6803934a38eb","block_type":"box","text":"Direct GHG emissions.","page_number":329,"box":{"x":186,"y":609,"width":174,"height":10}},{"id":"d62e0079-a5c2-46b8-9fc3-e263f3136451","block_type":"box","text":"Direct GHG emissions occur from sources that are owned or","page_number":329,"box":{"x":368,"y":609,"width":453,"height":10}},{"id":"65a20ef9-1144-46b4-a7eb-882e62911a92","block_type":"box","text":"controlled by the company, for example, emissions from combustion in owned or controlled boilers,","page_number":329,"box":{"x":116,"y":625,"width":740,"height":12}},{"id":"6225b515-0b94-4ee4-83cc-6b6da8d3c8df","block_type":"box","text":"furnaces, vehicles, etc.; emissions from chemical production in owned or controlled process","page_number":329,"box":{"x":116,"y":640,"width":686,"height":12}},{"id":"dc56d110-bdcc-4bf1-b0fa-86900cd897e6","block_type":"box","text":"equipment.","page_number":329,"box":{"x":116,"y":656,"width":81,"height":12}},{"id":"8d198079-d3cf-44ce-8e96-a966b0d892d1","block_type":"box","text":"29","page_number":329,"box":{"x":199,"y":656,"width":12,"height":6}},{"id":"6ea74167-e73c-4117-80c3-bb201562cb0e","block_type":"box","text":"Scope 2:","page_number":329,"box":{"x":116,"y":685,"width":68,"height":11}},{"id":"914bf9de-de38-4261-a3a8-863882f40255","block_type":"box","text":"Electricity indirect GHG emissions Scope 2 accounts for GHG emissions from the generation","page_number":329,"box":{"x":192,"y":685,"width":687,"height":12}},{"id":"e47f36ca-66dc-471a-8a93-1c27a4d3b6a7","block_type":"box","text":"of purchased electricity [steam, and heating/cooling] consumed by the company. [It] is defined as","page_number":329,"box":{"x":116,"y":700,"width":720,"height":12}},{"id":"80fa36f6-bb3b-480e-b0e6-c545dab2d1a6","block_type":"box","text":"electricity [steam, and heating/cooling] that is purchased or otherwise brought into the organizational","page_number":329,"box":{"x":116,"y":716,"width":744,"height":12}},{"id":"0fd4267d-66b8-4428-a82d-af17200090ba","block_type":"box","text":"boundary of the company.","page_number":329,"box":{"x":117,"y":731,"width":192,"height":12}},{"id":"20a364c3-a6de-40a3-a637-15f2cd7c07d6","block_type":"box","text":"30","page_number":329,"box":{"x":311,"y":731,"width":11,"height":6}},{"id":"e736f767-f7fd-4dd2-9a4a-3991da526b9f","block_type":"box","text":"27","page_number":329,"box":{"x":143,"y":756,"width":9,"height":5}},{"id":"d71938c7-6656-41ae-8350-1b1a8b586abb","block_type":"box","text":"As defined by the International Financial Reporting Standards, “IFRS S2: Climate-related Disclosures,” June 2023..","page_number":329,"box":{"x":170,"y":756,"width":682,"height":10}},{"id":"934c5305-8fef-47ee-91d8-8a26c4be1c9a","block_type":"box","text":"Several jurisdictions are basing their own transition plan disclosure frameworks on the IFRS S2 definition. We anticipate","page_number":329,"box":{"x":170,"y":769,"width":711,"height":10}},{"id":"e1004463-6204-448d-a702-0ff1b7fed7f2","block_type":"box","text":"transition plan disclosure becoming mandatory in an increasing number of jurisdictions over the near term.","page_number":329,"box":{"x":170,"y":782,"width":630,"height":10}},{"id":"8a586b61-6c7b-492a-9beb-170b6a6a2eaa","block_type":"box","text":"28","page_number":329,"box":{"x":143,"y":797,"width":9,"height":5}},{"id":"7758712f-de0c-4976-bed3-aeb9007e4ead","block_type":"box","text":"As defined by the Science Based Targets initiative (SBTi). SBTi “is a corporate climate action organization that enables","page_number":329,"box":{"x":170,"y":797,"width":707,"height":10}},{"id":"1ee786ab-3cc6-4ac5-8e41-fe57e91b4e17","block_type":"box","text":"companies and financial institutions worldwide to play their part in combating the climate crisis. We develop standards,","page_number":329,"box":{"x":170,"y":810,"width":702,"height":10}},{"id":"2abd0d7e-6956-426f-a778-de0866f115af","block_type":"box","text":"tools and guidance which allow companies to set greenhouse gas (GHG) emissions reductions targets in line with what","page_number":329,"box":{"x":170,"y":823,"width":707,"height":10}},{"id":"cf503727-4ec9-4724-9733-21303c888c91","block_type":"box","text":"is needed to keep global heating below catastrophic levels and reach net-zero by 2050 at latest.” Source: Science","page_number":329,"box":{"x":170,"y":836,"width":675,"height":10}},{"id":"d6ec1624-9bab-48b5-b9a0-d27a91acca23","block_type":"box","text":"Based Targets initiative, “About Us.” Websites accessed in December 2025.","page_number":329,"box":{"x":171,"y":849,"width":450,"height":10}},{"id":"909c85c3-95c2-4e48-838e-8ee4c3d45a0f","block_type":"box","text":"29","page_number":329,"box":{"x":143,"y":864,"width":9,"height":5}},{"id":"dc8fe522-2f71-47b9-9373-ca47b71ac2df","block_type":"box","text":"Greenhouse Gas Protocol, “A Corporate Accounting and Reporting Standard,” Revised Edition.","page_number":329,"box":{"x":170,"y":864,"width":565,"height":10}},{"id":"6c1d3173-c07d-4a3d-8258-ccd0eee8a2b1","block_type":"box","text":"30","page_number":329,"box":{"x":143,"y":879,"width":9,"height":5}},{"id":"5febba20-5719-497a-a2c4-24ade64bd535","block_type":"box","text":"Greenhouse Gas Protocol, “A Corporate Accounting and Reporting Standard,” Revised Edition.","page_number":329,"box":{"x":170,"y":879,"width":565,"height":10}},{"id":"2ca0c7d6-0428-4fcb-bf0e-e063cd6a851d","block_type":"box","text":"BlackRock Investment Stewardship","page_number":329,"box":{"x":117,"y":909,"width":262,"height":11}},{"id":"aa1c7a01-5350-4415-947a-c196c510cc54","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines |","page_number":329,"box":{"x":481,"y":909,"width":375,"height":11}},{"id":"6302c8c5-737d-4eed-8435-f1e5ba74fa43","block_type":"box","text":"11","page_number":329,"box":{"x":867,"y":909,"width":14,"height":9}},{"id":"f6ead80e-1f62-4172-b40a-45d7fb7a9f0a","block_type":"box","text":"NM1026U-6004382-329/605","page_number":329,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"54b9bf4c-4733-4c11-ac41-9281594dedc7","block_type":"box","text":"Scope 3:","page_number":330,"box":{"x":116,"y":87,"width":74,"height":12}},{"id":"6e384b06-3492-4e1b-b111-b3ae8ecd4e95","block_type":"box","text":"Other indirect GHG emissions. 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All rights reserved.","page_number":332,"box":{"x":125,"y":813,"width":301,"height":12}},{"id":"e2094fd0-3dc6-4578-9b46-cec81ba2cf82","block_type":"box","text":"BLACKROCK","page_number":332,"box":{"x":433,"y":813,"width":107,"height":10}},{"id":"7565ab97-0967-4359-b46a-6069c0132a7d","block_type":"box","text":"is a trademark of BlackRock, Inc., or its","page_number":332,"box":{"x":546,"y":813,"width":290,"height":11}},{"id":"708b2843-f1e7-4e87-bd81-a6886c157616","block_type":"box","text":"subsidiaries in the United States and elsewhere. All other trademarks are those of their respective","page_number":332,"box":{"x":116,"y":828,"width":731,"height":12}},{"id":"42038df3-05f6-48d2-94f9-ef2b899e756a","block_type":"box","text":"owners.","page_number":332,"box":{"x":116,"y":847,"width":63,"height":7}},{"id":"a633955f-9aa4-445f-b95a-982933768d98","block_type":"box","text":"NM1026U-6004382-332/605","page_number":332,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9dbc63b5-e86a-4a7d-9e78-d303c568e4af","block_type":"box","text":"PART II","page_number":333,"box":{"x":432,"y":92,"width":149,"height":22}},{"id":"f240e9c0-6f52-4f4d-a02e-b456f34e57f7","block_type":"box","text":"Throughout this Statement of Additional Information (“SAI”), each BlackRock-advised fund may be","page_number":333,"box":{"x":116,"y":143,"width":734,"height":12}},{"id":"ad3dfffe-a230-441a-91d5-ce7630ad191d","block_type":"box","text":"referred to as a “Fund” or collectively with others as the “Funds.” Certain Funds may also be referred to","page_number":333,"box":{"x":117,"y":158,"width":770,"height":13}},{"id":"ec1af87a-c407-4672-90f8-73baf3a45103","block_type":"box","text":"as “Municipal Funds” if they invest certain of their assets in municipal investments described below.","page_number":333,"box":{"x":116,"y":174,"width":743,"height":12}},{"id":"c0eec5e5-f4bf-4f1e-b326-44734ba3212f","block_type":"box","text":"Each Fund is organized either as a Maryland corporation, a Massachusetts business trust or a","page_number":333,"box":{"x":117,"y":205,"width":704,"height":11}},{"id":"df876e7b-c156-4b11-b7f7-e2c14e80d924","block_type":"box","text":"Delaware statutory trust. In each jurisdiction, nomenclature varies. For ease and clarity of presentation,","page_number":333,"box":{"x":117,"y":220,"width":769,"height":12}},{"id":"a9833e87-e2fe-4a96-8aef-b6ada39067c8","block_type":"box","text":"shares of common stock and shares of beneficial interest are referred to herein as “shares” or","page_number":333,"box":{"x":116,"y":235,"width":701,"height":10}},{"id":"2b5a4e1f-e6c2-4eb6-af2a-36e04015ee4a","block_type":"box","text":"“Common Stock,” holders of shares of Common Stock are referred to as “shareholders,” the trustees","page_number":333,"box":{"x":116,"y":251,"width":752,"height":11}},{"id":"d40cd4c7-3ad1-42fd-bf0b-22979b49c26c","block_type":"box","text":"or directors of each Fund are referred to as “Directors,” the boards of trustees/directors of each Fund","page_number":333,"box":{"x":116,"y":266,"width":754,"height":12}},{"id":"fb701d17-dd05-4cde-a9a3-3518d5687197","block_type":"box","text":"are referred to as the “Board of Directors” or the “Board,” BlackRock Advisors, LLC, BlackRock Fund","page_number":333,"box":{"x":116,"y":282,"width":752,"height":11}},{"id":"456a284b-c95e-4d66-a32e-11c4d517586c","block_type":"box","text":"Advisors or their respective affiliates is the investment adviser or manager of each Fund and is referred","page_number":333,"box":{"x":116,"y":297,"width":771,"height":12}},{"id":"a0322970-a390-4460-891c-c74564d0083c","block_type":"box","text":"to herein as the “Manager” or “BlackRock,” and the investment advisory agreement or management","page_number":333,"box":{"x":116,"y":313,"width":745,"height":12}},{"id":"d642e341-4f3e-406f-ad0a-e18d3f852609","block_type":"box","text":"agreement applicable to each Fund is referred to as the “Management Agreement.” Each Fund’s","page_number":333,"box":{"x":116,"y":328,"width":722,"height":13}},{"id":"106a4a65-9d3c-4f75-adb7-df0f917d6484","block_type":"box","text":"Articles of Incorporation or Declaration of Trust, together with all amendments thereto, is referred to as","page_number":333,"box":{"x":116,"y":344,"width":765,"height":12}},{"id":"5d6e61ab-6c31-46c6-9f8a-886495e1454a","block_type":"box","text":"its “charter.” The Investment Company Act of 1940, as amended, is referred to herein as the","page_number":333,"box":{"x":117,"y":359,"width":689,"height":13}},{"id":"1d9e131e-8f2a-4d22-8e2e-9e541f0c4570","block_type":"box","text":"“Investment Company Act.” The Securities Act of 1933, as amended, is referred to herein as the","page_number":333,"box":{"x":116,"y":375,"width":719,"height":12}},{"id":"825f354b-62df-4de1-8ce0-7eebc224660e","block_type":"box","text":"“Securities Act.” The Securities and Exchange Commission is referred to herein as the “Commission”","page_number":333,"box":{"x":116,"y":390,"width":755,"height":13}},{"id":"fed11849-8f33-4233-b565-fb11b28ef9b5","block_type":"box","text":"or the “SEC.”","page_number":333,"box":{"x":116,"y":406,"width":103,"height":9}},{"id":"938d8b98-ccbf-4105-a26a-6b90146964b5","block_type":"box","text":"Certain Funds are “feeder” funds (each, a “Feeder Fund”) that invest all or a portion of their assets in a","page_number":333,"box":{"x":117,"y":436,"width":765,"height":12}},{"id":"15c723f2-6905-4fcd-88eb-9f457b5bd21d","block_type":"box","text":"corresponding “master” portfolio (each, a “Master Portfolio”) of a master limited liability company (each,","page_number":333,"box":{"x":116,"y":452,"width":770,"height":12}},{"id":"26253906-3e60-4dee-bba3-035187d68179","block_type":"box","text":"a “Master LLC”), a mutual fund that has the same objective and strategies as the Feeder Fund. All","page_number":333,"box":{"x":116,"y":467,"width":734,"height":12}},{"id":"7ae7b84a-7aa8-4bba-a232-fa72f63220c7","block_type":"box","text":"investments are generally made at the level of the Master Portfolio. This structure is sometimes called","page_number":333,"box":{"x":117,"y":483,"width":761,"height":12}},{"id":"16c6dd36-d7bb-47c3-9ff6-13aa7beaf025","block_type":"box","text":"a “master/feeder” structure. A Feeder Fund’s investment results will correspond directly to the","page_number":333,"box":{"x":116,"y":498,"width":700,"height":12}},{"id":"3321616f-420f-4936-a565-121d12f570a6","block_type":"box","text":"investment results of the underlying Master Portfolio in which it invests. For simplicity, this SAI uses the","page_number":333,"box":{"x":117,"y":514,"width":770,"height":12}},{"id":"63a05b56-001a-43cb-938d-0fef5435b2cb","block_type":"box","text":"term “Fund” to include both a Feeder Fund and its Master Portfolio.","page_number":333,"box":{"x":116,"y":529,"width":503,"height":10}},{"id":"16dcf0f9-f4fa-4b82-a723-118ed1de1409","block_type":"box","text":"Certain information contained herein may not be relevant to a particular Fund.","page_number":333,"box":{"x":117,"y":560,"width":582,"height":12}},{"id":"6bf30c58-53b0-4716-9a07-15d3a694f3bf","block_type":"box","text":"Investment Risks and Considerations","page_number":333,"box":{"x":119,"y":610,"width":675,"height":23}},{"id":"499aeab4-d962-49c5-b6b1-bc4e709fd980","block_type":"box","text":"Set forth below are descriptions of some of the types of investments and investment strategies that one","page_number":333,"box":{"x":116,"y":661,"width":767,"height":12}},{"id":"686da7da-1393-4c74-8308-07b4aeb1cd4e","block_type":"box","text":"or more of the Funds may use, and the risks and considerations associated with those investments","page_number":333,"box":{"x":116,"y":677,"width":735,"height":12}},{"id":"f267316c-340d-475a-b638-b92f61a2eef7","block_type":"box","text":"and investment strategies. Please see each Fund’s prospectuses (the “Prospectus”) and the","page_number":333,"box":{"x":116,"y":692,"width":685,"height":12}},{"id":"eff68444-586c-4875-bc14-bbf0d042316e","block_type":"box","text":"“Investment Objective and Policies,” “Investment Objectives and Policies” or “Investment Strategies","page_number":333,"box":{"x":116,"y":708,"width":737,"height":12}},{"id":"224edd22-4016-425b-9d0b-ab773b5bf2cc","block_type":"box","text":"and Risks of the Fund” section, as applicable, of Part I of this SAI for further information on each","page_number":333,"box":{"x":116,"y":723,"width":714,"height":12}},{"id":"8740fb2f-3077-4c3a-908d-ee5f170b139e","block_type":"box","text":"Fund’s investment policies and risks. Information contained in this section about the risks and","page_number":333,"box":{"x":117,"y":739,"width":692,"height":12}},{"id":"59bd34ea-59b7-4a29-a5b8-3139ddb0f66e","block_type":"box","text":"considerations associated with a Fund’s investments and/or investment strategies applies only to those","page_number":333,"box":{"x":116,"y":754,"width":765,"height":12}},{"id":"0f665a99-4e62-47f5-8838-963d949a7606","block_type":"box","text":"Funds specifically identified in Part I of this SAI as making each type of investment or using each","page_number":333,"box":{"x":117,"y":770,"width":716,"height":12}},{"id":"5242ee49-ee93-479e-9bb5-d62bd78d203d","block_type":"box","text":"investment strategy (each, a “Covered Fund”). Information that does not apply to a Covered Fund does","page_number":333,"box":{"x":117,"y":785,"width":764,"height":12}},{"id":"1c5d50c5-36b4-43d3-ac90-b79d42796600","block_type":"box","text":"not form a part of that Covered Fund’s SAI and should not be relied on by investors in that Covered","page_number":333,"box":{"x":117,"y":801,"width":735,"height":12}},{"id":"3be95b66-f3e2-44ef-b5b0-a328b8de3eea","block_type":"box","text":"Fund. Only information that is clearly identified as applicable to a Covered Fund is considered to form a","page_number":333,"box":{"x":117,"y":816,"width":765,"height":12}},{"id":"16141138-b66c-4b82-aeb0-6ead0135186d","block_type":"box","text":"part of that Covered Fund’s SAI.","page_number":333,"box":{"x":117,"y":832,"width":244,"height":12}},{"id":"1c273542-414f-4f90-bd40-803d252f4a00","block_type":"box","text":"Asset-Backed Securities.","page_number":333,"box":{"x":116,"y":862,"width":200,"height":10}},{"id":"97d23195-e8f8-4691-aa32-ad9058e11da5","block_type":"box","text":"Asset-backed securities are securities backed by home equity loans,","page_number":333,"box":{"x":317,"y":862,"width":519,"height":12}},{"id":"c2f62797-5e62-470f-9d5d-7b0b29ed9674","block_type":"box","text":"installment sale contracts, credit card receivables or other assets. Asset-backed securities are","page_number":333,"box":{"x":117,"y":878,"width":702,"height":11}},{"id":"08463aed-2545-4518-a273-dcbc251d1c89","block_type":"box","text":"II-1","page_number":333,"box":{"x":489,"y":909,"width":20,"height":9}},{"id":"b15ebd9d-9d85-41c8-91e6-388a4d0fed35","block_type":"box","text":"NM1026U-6004382-333/605","page_number":333,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b099d6ad-192d-4078-a3f3-5fe6e012615a","block_type":"box","text":"“pass-through” securities, meaning that principal and interest payments — net of expenses — made by","page_number":334,"box":{"x":116,"y":87,"width":770,"height":12}},{"id":"355264a7-1080-48a6-881d-59166c6f13e4","block_type":"box","text":"the borrower on the underlying assets (such as credit card receivables) are passed through to a Fund.","page_number":334,"box":{"x":116,"y":102,"width":763,"height":13}},{"id":"124256be-788a-4857-8458-fb7211dad5f1","block_type":"box","text":"The value of asset-backed securities, like that of traditional fixed-income securities, typically increases","page_number":334,"box":{"x":116,"y":118,"width":763,"height":12}},{"id":"07831f22-4328-48a8-b288-3d002a325c37","block_type":"box","text":"when interest rates fall and decreases when interest rates rise. However, asset-backed securities differ","page_number":334,"box":{"x":116,"y":134,"width":770,"height":11}},{"id":"9eab24e7-75ef-47bc-9a5a-824e69cfee1b","block_type":"box","text":"from traditional fixed-income securities because of their potential for prepayment. The price paid by a","page_number":334,"box":{"x":116,"y":149,"width":755,"height":12}},{"id":"8e2f790b-c510-4fec-b70a-26887d0c3435","block_type":"box","text":"Fund for its asset-backed securities, the yield the Fund expects to receive from such securities and the","page_number":334,"box":{"x":117,"y":165,"width":767,"height":12}},{"id":"b3e02e58-6909-4cf6-b416-8d0b36ec741e","block_type":"box","text":"average life of the securities are based on a number of factors, including the anticipated rate of","page_number":334,"box":{"x":116,"y":180,"width":709,"height":12}},{"id":"61ecafa5-ee3d-4e55-b8dc-0695ee2f88af","block_type":"box","text":"prepayment of the underlying assets. In a period of declining interest rates, borrowers may prepay the","page_number":334,"box":{"x":117,"y":196,"width":761,"height":12}},{"id":"b37935fd-346c-4a47-8eb8-6e3bfaaaa67e","block_type":"box","text":"underlying assets more quickly than anticipated, thereby reducing the yield to maturity and the average","page_number":334,"box":{"x":117,"y":211,"width":769,"height":12}},{"id":"5b3df5ac-8277-47f4-96aa-9f15a0592d10","block_type":"box","text":"life of the asset-backed securities. Moreover, when a Fund reinvests the proceeds of a prepayment in","page_number":334,"box":{"x":117,"y":227,"width":758,"height":12}},{"id":"562032be-0e72-4524-91c3-b60cd10ad972","block_type":"box","text":"these circumstances, it will likely receive a rate of interest that is lower than the rate on the security that","page_number":334,"box":{"x":116,"y":242,"width":772,"height":12}},{"id":"a9561c63-4b07-4823-a72f-7eabdad2f1a9","block_type":"box","text":"was prepaid. To the extent that a Fund purchases asset-backed securities at a premium, prepayments","page_number":334,"box":{"x":116,"y":258,"width":765,"height":12}},{"id":"19745d95-96ce-44b5-9354-72960efde294","block_type":"box","text":"may result in a loss to the extent of the premium paid. If a Fund buys such securities at a discount,","page_number":334,"box":{"x":117,"y":273,"width":736,"height":12}},{"id":"411b4918-01b2-42c5-8740-a6732fc34311","block_type":"box","text":"both scheduled payments and unscheduled prepayments will increase current and total returns and","page_number":334,"box":{"x":117,"y":289,"width":742,"height":12}},{"id":"85261bf9-fa50-44d9-bc89-c9bf4283d39f","block_type":"box","text":"unscheduled prepayments will also accelerate the recognition of income which, when distributed to","page_number":334,"box":{"x":117,"y":304,"width":738,"height":12}},{"id":"9738d664-9013-4072-9e08-7f001c9b39df","block_type":"box","text":"shareholders, will be taxable as ordinary income. In a period of rising interest rates, prepayments of the","page_number":334,"box":{"x":116,"y":320,"width":772,"height":12}},{"id":"bbaa5e67-3dda-452f-9e17-7547642a9df1","block_type":"box","text":"underlying assets may occur at a slower than expected rate, creating maturity extension risk. This","page_number":334,"box":{"x":117,"y":335,"width":730,"height":12}},{"id":"f9349ebd-45b2-4041-9057-bddf24635423","block_type":"box","text":"particular risk may effectively change a security that was considered short- or intermediate-term at the","page_number":334,"box":{"x":117,"y":351,"width":762,"height":12}},{"id":"d0a93f25-7bcc-482c-bcc4-8831266a47dc","block_type":"box","text":"time of purchase into a longer term security. Since the value of longer-term securities generally","page_number":334,"box":{"x":116,"y":366,"width":710,"height":12}},{"id":"c63ee549-bcd7-448f-ad4f-a4ba622887c4","block_type":"box","text":"fluctuates more widely in response to changes in interest rates than does the value of shorter-term","page_number":334,"box":{"x":116,"y":382,"width":736,"height":12}},{"id":"f0438ef2-d83d-4b3f-bff3-83d914220147","block_type":"box","text":"securities, maturity extension risk could increase the volatility of the Fund. When interest rates decline,","page_number":334,"box":{"x":116,"y":397,"width":766,"height":12}},{"id":"ad072ec3-9dce-4d97-912e-d0a7e8b29f04","block_type":"box","text":"the value of an asset-backed security with prepayment features may not increase as much as that of","page_number":334,"box":{"x":116,"y":413,"width":751,"height":12}},{"id":"ebfa77ea-e062-40cd-ae86-9dc3f19796d1","block_type":"box","text":"other fixed-income securities, and, as noted above, changes in market rates of interest may accelerate","page_number":334,"box":{"x":116,"y":428,"width":767,"height":12}},{"id":"f6b5f38d-7723-49d0-9c17-3d6b279c5288","block_type":"box","text":"or retard prepayments and thus affect maturities.","page_number":334,"box":{"x":116,"y":444,"width":368,"height":12}},{"id":"1c1661c5-5b39-4560-af36-3e1410f73f23","block_type":"box","text":"Asset-Based Securities.","page_number":334,"box":{"x":116,"y":475,"width":190,"height":9}},{"id":"ffdb95d2-b665-4fb2-93be-16dcf0e04860","block_type":"box","text":"Certain Funds may invest in debt, preferred or convertible securities, the","page_number":334,"box":{"x":307,"y":475,"width":548,"height":12}},{"id":"5045f6ac-7654-4c83-8355-8643aae136d5","block_type":"box","text":"principal amount, redemption terms or conversion terms of which are related to the market price of","page_number":334,"box":{"x":117,"y":490,"width":734,"height":12}},{"id":"a000f00d-4ed2-43a9-b340-f78f096d4e8e","block_type":"box","text":"some natural resource asset such as gold bullion. These securities are referred to as “asset-based","page_number":334,"box":{"x":116,"y":506,"width":737,"height":12}},{"id":"09d0fb2f-c9a6-4905-8867-7e81de29318f","block_type":"box","text":"securities.” A Fund will purchase only asset-based securities that are rated, or are issued by issuers","page_number":334,"box":{"x":116,"y":521,"width":746,"height":12}},{"id":"23c2f460-c406-4f71-908f-62a90629b7ee","block_type":"box","text":"that have outstanding debt obligations rated, investment grade (for example, AAA, AA, A or BBB by","page_number":334,"box":{"x":116,"y":537,"width":744,"height":12}},{"id":"823a03b2-c0b9-4b01-a185-496844cd5884","block_type":"box","text":"S&P Global Ratings (“S&P”) or Fitch Ratings (“Fitch”), or Baa by Moody’s Investors Service, Inc.","page_number":334,"box":{"x":116,"y":552,"width":719,"height":12}},{"id":"5e2d4b2b-b85a-4c79-a3a6-8e4e5cea79b4","block_type":"box","text":"(“Moody’s”) or commercial paper rated A-1 by S&P or Prime-1 by Moody’s) or by issuers that the","page_number":334,"box":{"x":117,"y":568,"width":721,"height":12}},{"id":"84ef393e-26be-42b8-a7d5-67b83f307474","block_type":"box","text":"Manager has determined to be of similar creditworthiness. Obligations ranked in the fourth highest","page_number":334,"box":{"x":117,"y":583,"width":733,"height":12}},{"id":"2ca566f1-48f6-4cbe-bcf1-9137bca68515","block_type":"box","text":"rating category, while considered “investment grade,” may have certain speculative characteristics and","page_number":334,"box":{"x":117,"y":599,"width":766,"height":12}},{"id":"8c1d827d-b2e9-47ea-99f4-dce11c47007a","block_type":"box","text":"may be more likely to be downgraded than securities rated in the three highest rating categories. If an","page_number":334,"box":{"x":117,"y":614,"width":759,"height":12}},{"id":"d6e16d30-81c3-4fbd-8ee6-4a7cdcc7a631","block_type":"box","text":"asset-based security is backed by a bank letter of credit or other similar facility, the Manager may take","page_number":334,"box":{"x":116,"y":630,"width":764,"height":12}},{"id":"000848d7-3752-45e5-991b-a68bec9c9400","block_type":"box","text":"such backing into account in determining the creditworthiness of the issuer. While the market prices for","page_number":334,"box":{"x":116,"y":645,"width":769,"height":12}},{"id":"713d0bd3-d258-49e9-89de-8f4ea99f9d62","block_type":"box","text":"an asset-based security and the related natural resource asset generally are expected to move in the","page_number":334,"box":{"x":116,"y":661,"width":751,"height":12}},{"id":"5765e16f-9f3d-444b-b91e-a34105aea47a","block_type":"box","text":"same direction, there may not be perfect correlation in the two price movements. Asset-based","page_number":334,"box":{"x":116,"y":676,"width":696,"height":12}},{"id":"dee0ea97-f667-4c10-ae3c-14ca116f38d7","block_type":"box","text":"securities may not be secured by a security interest in or claim on the underlying natural resource","page_number":334,"box":{"x":116,"y":692,"width":723,"height":12}},{"id":"16100348-7a5f-47c5-af2e-becdc887f33c","block_type":"box","text":"asset. The asset-based securities in which a Fund may invest may bear interest or pay preferred","page_number":334,"box":{"x":116,"y":707,"width":716,"height":12}},{"id":"205bd9f1-894c-4e37-8ea0-bf99b7036015","block_type":"box","text":"dividends at below market (or even relatively nominal) rates. Certain asset-based securities may be","page_number":334,"box":{"x":116,"y":723,"width":738,"height":12}},{"id":"3e509096-0da8-4840-8e8a-07fb03d27bd2","block_type":"box","text":"payable at maturity in cash at the stated principal amount or, at the option of the holder, directly in a","page_number":334,"box":{"x":117,"y":738,"width":738,"height":12}},{"id":"8c403660-2b93-4378-b93d-8dee6a7fe0c0","block_type":"box","text":"stated amount of the asset to which it is related. In such instance, because no Fund presently intends","page_number":334,"box":{"x":116,"y":754,"width":753,"height":12}},{"id":"d99668d7-358b-41c4-80e4-8a65e55ff288","block_type":"box","text":"to invest directly in natural resource assets, a Fund would sell the asset-based security in the","page_number":334,"box":{"x":116,"y":769,"width":691,"height":12}},{"id":"6a6da8b1-1ed2-40d6-8e21-7efd72987e76","block_type":"box","text":"secondary market, to the extent one exists, prior to maturity if the value of the stated amount of the","page_number":334,"box":{"x":116,"y":785,"width":733,"height":12}},{"id":"fe3ea71d-e7ff-45ab-a41d-bcd5a241fc33","block_type":"box","text":"asset exceeds the stated principal amount and thereby realize the appreciation in the underlying asset.","page_number":334,"box":{"x":116,"y":800,"width":763,"height":12}},{"id":"3ab43d40-c7db-4fca-94f0-269d77af63df","block_type":"box","text":"Precious Metal-Related Securities.","page_number":334,"box":{"x":116,"y":831,"width":256,"height":10}},{"id":"4a19a220-f401-45a0-a7e6-e7ec423f27c8","block_type":"box","text":"A Fund may invest in the equity and other securities of companies","page_number":334,"box":{"x":374,"y":831,"width":500,"height":12}},{"id":"42404d8e-de04-4641-9ad5-528b0aaee312","block_type":"box","text":"that explore for, extract, process or deal in precious metals (","page_number":334,"box":{"x":116,"y":847,"width":447,"height":12}},{"id":"048de691-29fc-4f33-80ae-6534ca6ff21d","block_type":"box","text":"e.g.","page_number":334,"box":{"x":564,"y":849,"width":26,"height":10}},{"id":"666fdf53-de6b-41ff-8fbc-9912bc39c2ba","block_type":"box","text":", gold, silver and platinum), and in","page_number":334,"box":{"x":593,"y":847,"width":255,"height":12}},{"id":"f0dbf7e5-e1b5-4459-8023-34d213314cb9","block_type":"box","text":"asset-based securities indexed to the value of such metals. Such securities may be purchased when","page_number":334,"box":{"x":116,"y":862,"width":752,"height":12}},{"id":"2a2c533b-3414-487d-8391-23171c661927","block_type":"box","text":"they are believed to be attractively priced in relation to the value of a company’s precious metal-related","page_number":334,"box":{"x":116,"y":878,"width":769,"height":12}},{"id":"e2035e22-0c97-4239-95c5-f6df253a7558","block_type":"box","text":"II-2","page_number":334,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"246692c3-c9ed-4212-9af1-6e1f59fec888","block_type":"box","text":"NM1026U-6004382-334/605","page_number":334,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"e4c75a03-aa09-46c1-994b-5487544a7bdc","block_type":"box","text":"assets or when the values of precious metals are expected to benefit from inflationary pressure or","page_number":335,"box":{"x":116,"y":87,"width":731,"height":12}},{"id":"bacc1bc6-b625-4f05-b8bd-f37fecb59f15","block_type":"box","text":"other economic, political or financial uncertainty or instability. Based on historical experience, during","page_number":335,"box":{"x":116,"y":102,"width":746,"height":13}},{"id":"f33642e0-1276-4121-9ccd-e8245d707984","block_type":"box","text":"periods of economic or financial instability the securities of companies involved in precious metals may","page_number":335,"box":{"x":117,"y":118,"width":766,"height":12}},{"id":"fb964ba5-9d1b-4fdf-81ba-1a5c29af9094","block_type":"box","text":"be subject to extreme price fluctuations, reflecting the high volatility of precious metal prices during","page_number":335,"box":{"x":117,"y":134,"width":736,"height":12}},{"id":"5b736e44-1ff1-4a6d-9a7b-abb51b4b6eba","block_type":"box","text":"such periods. In addition, the instability of precious metal prices may result in volatile earnings of","page_number":335,"box":{"x":116,"y":149,"width":721,"height":12}},{"id":"397894d4-5f80-4b83-9bfc-0774afc515b7","block_type":"box","text":"precious metal-related companies, which may, in turn, adversely affect the financial condition of such","page_number":335,"box":{"x":117,"y":165,"width":754,"height":12}},{"id":"dd4843bd-24f0-4f73-9638-3f76cfdcb07c","block_type":"box","text":"companies. The major producers of gold include the Republic of South Africa, Russia, Canada, the","page_number":335,"box":{"x":116,"y":180,"width":739,"height":12}},{"id":"876f14ab-da5c-43f1-ba2c-68b227d0c05f","block_type":"box","text":"United States, Brazil and Australia. Sales of gold by Russia are largely unpredictable and often relate","page_number":335,"box":{"x":117,"y":196,"width":754,"height":12}},{"id":"d08b9f9c-5eeb-458a-9a40-1c99b57a48d2","block_type":"box","text":"to political and economic considerations rather than to market forces. Economic, financial, social and","page_number":335,"box":{"x":116,"y":211,"width":753,"height":12}},{"id":"e946a310-2ef6-4926-896f-4350a64d41b0","block_type":"box","text":"political factors within South Africa may significantly affect South African gold production.","page_number":335,"box":{"x":117,"y":227,"width":663,"height":12}},{"id":"23955a7e-7bd4-4e7f-b1f1-8187f67dba81","block_type":"box","text":"Borrowing and Leverage.","page_number":335,"box":{"x":116,"y":258,"width":201,"height":12}},{"id":"239c2a5a-460a-4771-96e3-e8ca85fa6e07","block_type":"box","text":"Each Fund may borrow as a temporary measure for extraordinary or","page_number":335,"box":{"x":318,"y":258,"width":517,"height":12}},{"id":"ca91388f-b1fe-4d1d-b0da-5607f9cff36e","block_type":"box","text":"emergency purposes, including to meet redemptions or to settle securities transactions. Certain Funds","page_number":335,"box":{"x":116,"y":273,"width":765,"height":12}},{"id":"3e81432a-9985-4f7f-96e9-583e3d919762","block_type":"box","text":"will not purchase securities at any time when borrowings exceed 5% of their total assets, except (a) to","page_number":335,"box":{"x":116,"y":289,"width":761,"height":12}},{"id":"c6fbbcc0-2401-4b88-9f00-d645abf6cca9","block_type":"box","text":"honor prior commitments or (b) to exercise subscription rights when outstanding borrowings have been","page_number":335,"box":{"x":117,"y":304,"width":768,"height":12}},{"id":"a101bc43-85c1-4654-9a96-4ba248624847","block_type":"box","text":"obtained exclusively for settlements of other securities transactions.","page_number":335,"box":{"x":116,"y":320,"width":508,"height":12}},{"id":"a80fcfed-3a7e-47fd-b6b0-8d8e8ab968f0","block_type":"box","text":"Certain Funds may also borrow in order to make investments, to the extent disclosed in such Fund’s","page_number":335,"box":{"x":117,"y":351,"width":748,"height":12}},{"id":"fa7aef3d-8c28-418a-a9f0-5baf513559bf","block_type":"box","text":"Prospectus. The purchase of securities while borrowings are outstanding will have the effect of","page_number":335,"box":{"x":117,"y":366,"width":707,"height":12}},{"id":"ceba971b-5038-4fc4-820b-7ee24b46563f","block_type":"box","text":"leveraging the Fund. Such leveraging increases the Fund’s exposure to capital risk, and borrowed","page_number":335,"box":{"x":117,"y":382,"width":731,"height":12}},{"id":"e53f748a-8dc2-45e6-9286-3917c2364875","block_type":"box","text":"funds are subject to interest costs that will reduce net income. The use of leverage by a Fund creates","page_number":335,"box":{"x":116,"y":397,"width":757,"height":12}},{"id":"9fe08398-95da-4b46-8e0c-9e2e12b30f22","block_type":"box","text":"an opportunity for greater total return, but, at the same time, creates special risks. For example,","page_number":335,"box":{"x":116,"y":413,"width":714,"height":12}},{"id":"5da9a260-7f56-463e-b245-a3d017011001","block_type":"box","text":"leveraging may exaggerate changes in the net asset value (“NAV”) of Fund shares and in the yield on","page_number":335,"box":{"x":117,"y":428,"width":758,"height":12}},{"id":"40e02eb5-898f-4eab-a6a3-dd22e4e9ee5a","block_type":"box","text":"the Fund’s portfolio. Although the principal of such borrowings will be fixed, the Fund’s assets may","page_number":335,"box":{"x":116,"y":444,"width":734,"height":12}},{"id":"6e621c4f-9761-4839-8804-dfbbc38533df","block_type":"box","text":"change in value during the time the borrowings are outstanding. Borrowings will create interest","page_number":335,"box":{"x":116,"y":459,"width":707,"height":12}},{"id":"56ae3afb-96ed-428e-807a-0ffd5cb752b9","block_type":"box","text":"expenses for the Fund that can exceed the income from the assets purchased with the borrowings. To","page_number":335,"box":{"x":116,"y":475,"width":764,"height":12}},{"id":"c2668f9b-f8d1-4c4a-970c-5b6021a4c26b","block_type":"box","text":"the extent the income or capital appreciation derived from securities purchased with borrowed funds","page_number":335,"box":{"x":116,"y":490,"width":747,"height":12}},{"id":"88b8723f-7d3b-4ef8-94a6-38e9bf1d9920","block_type":"box","text":"exceeds the interest the Fund will have to pay on the borrowings, the Fund’s return will be greater than","page_number":335,"box":{"x":116,"y":506,"width":768,"height":12}},{"id":"437bcfae-b7a0-4da3-a486-8847485280b6","block_type":"box","text":"if leverage had not been used. Conversely, if the income or capital appreciation from the securities","page_number":335,"box":{"x":117,"y":521,"width":735,"height":12}},{"id":"63a32511-b923-475a-ab57-d3ebd58515f4","block_type":"box","text":"purchased with such borrowed funds is not sufficient to cover the cost of borrowing, the return to the","page_number":335,"box":{"x":117,"y":537,"width":748,"height":12}},{"id":"120e486e-0df5-43e1-9058-b277db692143","block_type":"box","text":"Fund will be less than if leverage had not been used and, therefore, the amount available for","page_number":335,"box":{"x":117,"y":552,"width":690,"height":12}},{"id":"0478db80-27f9-4286-acc8-66f5417c7e5e","block_type":"box","text":"distribution to shareholders as dividends will be reduced. In the latter case, the Manager in its best","page_number":335,"box":{"x":116,"y":568,"width":735,"height":12}},{"id":"71f132c9-f1a9-4f19-be73-2c93a15781da","block_type":"box","text":"judgment nevertheless may determine to maintain the Fund’s leveraged position if it expects that the","page_number":335,"box":{"x":115,"y":583,"width":752,"height":12}},{"id":"a6a1eeb1-690f-46bc-80a1-4b44d4537564","block_type":"box","text":"benefits to the Fund’s shareholders of maintaining the leveraged position will outweigh the current","page_number":335,"box":{"x":117,"y":599,"width":730,"height":12}},{"id":"d0de3bb2-24b2-4f34-a32e-62df37b4807b","block_type":"box","text":"reduced return.","page_number":335,"box":{"x":117,"y":614,"width":117,"height":10}},{"id":"f9428049-6a8c-4b58-af84-81e3a7feaab3","block_type":"box","text":"Certain types of borrowings by a Fund may result in the Fund being subject to covenants in credit","page_number":335,"box":{"x":117,"y":645,"width":727,"height":12}},{"id":"57d5b4ad-2f3d-4a77-a527-fb4eaaa36456","block_type":"box","text":"agreements relating to asset coverage, portfolio composition requirements and other matters. It is not","page_number":335,"box":{"x":116,"y":661,"width":753,"height":12}},{"id":"65841be3-51bf-47f6-8385-854f8c898a11","block_type":"box","text":"anticipated that observance of such covenants would impede the Manager from managing a Fund’s","page_number":335,"box":{"x":116,"y":676,"width":739,"height":12}},{"id":"e99b7997-b05f-4137-a382-4646871be345","block_type":"box","text":"portfolio in accordance with the Fund’s investment objectives and policies. However, a breach of any","page_number":335,"box":{"x":117,"y":692,"width":746,"height":12}},{"id":"9f988471-fcde-4ec2-99eb-ea73116bfb18","block_type":"box","text":"such covenants not cured within the specified cure period may result in acceleration of outstanding","page_number":335,"box":{"x":116,"y":707,"width":732,"height":12}},{"id":"78d13fad-2e0a-4c36-8628-98a39f38af8e","block_type":"box","text":"indebtedness and require the Fund to dispose of portfolio investments at a time when it may be","page_number":335,"box":{"x":117,"y":723,"width":706,"height":12}},{"id":"7dbaaf51-22c7-42ed-bbfc-69d068fdae77","block_type":"box","text":"disadvantageous to do so.","page_number":335,"box":{"x":116,"y":738,"width":195,"height":12}},{"id":"3eb60e67-b4e7-49d3-ac21-22831c98dec4","block_type":"box","text":"Each Fund may at times borrow from affiliates of the Manager, provided that the terms of such","page_number":335,"box":{"x":117,"y":769,"width":699,"height":12}},{"id":"12152c45-1ba9-4611-8be6-6928a716802d","block_type":"box","text":"borrowings are no less favorable than those available from comparable sources of funds in the","page_number":335,"box":{"x":117,"y":785,"width":701,"height":12}},{"id":"c1525df8-96ba-4d15-a1bd-7191cc9b4259","block_type":"box","text":"marketplace.","page_number":335,"box":{"x":117,"y":800,"width":94,"height":12}},{"id":"7e9646de-6112-407c-a8d8-859ae2bd85c4","block_type":"box","text":"Cash Management.","page_number":335,"box":{"x":117,"y":831,"width":151,"height":12}},{"id":"ed8103c5-4e9a-441b-8527-4e49e30a7abf","block_type":"box","text":"Generally, the Manager will employ futures and options on futures to provide","page_number":335,"box":{"x":269,"y":831,"width":578,"height":12}},{"id":"30957265-af11-498c-9c4d-4ec53e41da4b","block_type":"box","text":"liquidity necessary to meet anticipated redemptions or for day-to-day operating purposes. However, if","page_number":335,"box":{"x":117,"y":847,"width":756,"height":12}},{"id":"2c289f7c-424e-4070-9903-00b380674b5d","block_type":"box","text":"considered appropriate in the opinion of the Manager, a portion of a Fund’s assets may be invested in","page_number":335,"box":{"x":116,"y":862,"width":760,"height":12}},{"id":"b5c7e529-d369-44fe-bc0b-8f7c5776a570","block_type":"box","text":"certain types of instruments with remaining maturities of 397 days or less for liquidity purposes. Such","page_number":335,"box":{"x":116,"y":878,"width":754,"height":12}},{"id":"33be404c-bfc4-4814-9c6f-0e8edd287ecf","block_type":"box","text":"II-3","page_number":335,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"7955ba03-7333-4004-87f6-e57e1b9a214c","block_type":"box","text":"NM1026U-6004382-335/605","page_number":335,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"66e1ec13-8476-44d3-8367-21ca1934bb00","block_type":"box","text":"instruments would consist of: (i) obligations of the U.S. Government, its agencies, instrumentalities,","page_number":336,"box":{"x":117,"y":87,"width":740,"height":12}},{"id":"24e721d0-4c23-41fc-94df-88adabeb58c5","block_type":"box","text":"authorities or political subdivisions (“U.S. Government Securities”); (ii) other fixed-income securities","page_number":336,"box":{"x":116,"y":102,"width":742,"height":13}},{"id":"51366979-fe99-4a3d-aeac-d263c8c29280","block_type":"box","text":"rated Aa or higher by Moody’s or AA or higher by S&P or, if unrated, of comparable quality in the","page_number":336,"box":{"x":117,"y":118,"width":721,"height":12}},{"id":"3840c718-9e48-4e8b-92c6-784a3dcf1992","block_type":"box","text":"opinion of the Manager; (iii) commercial paper; (iv) bank obligations, including negotiable certificates of","page_number":336,"box":{"x":116,"y":134,"width":768,"height":12}},{"id":"015e0c16-cc43-48f5-975d-651209ebe417","block_type":"box","text":"deposit, time deposits and bankers’ acceptances; and (v) repurchase agreements. At the time the","page_number":336,"box":{"x":116,"y":149,"width":730,"height":12}},{"id":"ea5f219e-241b-463c-969d-ca98f92e2fdb","block_type":"box","text":"Fund invests in commercial paper, bank obligations or repurchase agreements, the issuer or the","page_number":336,"box":{"x":117,"y":165,"width":718,"height":12}},{"id":"058c80d8-5517-476d-87e0-355654980d62","block_type":"box","text":"issuer’s parent must have outstanding debt rated Aa or higher by Moody’s or AA or higher by S&P or","page_number":336,"box":{"x":117,"y":180,"width":752,"height":12}},{"id":"9dc0a626-3ab3-4fd7-81c5-587fe5c9eab8","block_type":"box","text":"outstanding commercial paper, bank obligations or other short-term obligations rated Prime-1 by","page_number":336,"box":{"x":116,"y":196,"width":719,"height":12}},{"id":"4110d2d4-7ccd-4895-aaab-c802058dd6f0","block_type":"box","text":"Moody’s or A-1 by S&P; or, if no such ratings are available, the instrument must be of comparable","page_number":336,"box":{"x":117,"y":211,"width":731,"height":12}},{"id":"03df8cda-2720-44ac-a3f5-82a6e517d211","block_type":"box","text":"quality in the opinion of the Manager. For more information on money market instruments, see “Money","page_number":336,"box":{"x":116,"y":227,"width":765,"height":12}},{"id":"9ee27c46-a816-4f69-985f-b4cba18d8bc9","block_type":"box","text":"Market Securities” below.","page_number":336,"box":{"x":117,"y":242,"width":192,"height":10}},{"id":"f21ad50d-00c2-4e23-9c48-f2477c120f15","block_type":"box","text":"Collateralized Debt Obligations.","page_number":336,"box":{"x":117,"y":273,"width":251,"height":12}},{"id":"763cb149-648c-40fd-b326-993df30a4a71","block_type":"box","text":"Certain Funds may invest in collateralized debt obligations","page_number":336,"box":{"x":369,"y":273,"width":444,"height":12}},{"id":"a3acb1d3-9d41-4cbc-8c04-0bdd6db1b758","block_type":"box","text":"(“CDOs”), which include collateralized bond obligations (“CBOs”), collateralized loan obligations","page_number":336,"box":{"x":117,"y":289,"width":713,"height":12}},{"id":"b311f3fb-d67b-47a7-b7ea-bb7b184f5889","block_type":"box","text":"(“CLOs”) and other similarly structured securities. CDOs are types of asset-backed securities. A CBO","page_number":336,"box":{"x":117,"y":304,"width":756,"height":12}},{"id":"d2bffff3-e95b-4b45-b28f-360161f8deb0","block_type":"box","text":"is ordinarily issued by a trust or other special purpose entity (“SPE”) and is typically backed by a","page_number":336,"box":{"x":117,"y":320,"width":716,"height":12}},{"id":"95482144-aef0-4c77-9963-901dd0e6df19","block_type":"box","text":"diversified pool of fixed-income securities (which may include high risk, below investment grade","page_number":336,"box":{"x":116,"y":335,"width":713,"height":12}},{"id":"37921254-a682-4d7f-a744-d16d1a5837a5","block_type":"box","text":"securities) held by such issuer. A CLO is ordinarily issued by a trust or other SPE and is typically","page_number":336,"box":{"x":116,"y":351,"width":722,"height":12}},{"id":"04243928-6c41-474b-8f36-5481df7e26bb","block_type":"box","text":"collateralized by a pool of loans, which may include, among others, domestic and non-U.S. senior","page_number":336,"box":{"x":116,"y":366,"width":729,"height":12}},{"id":"3e1870e0-576f-41fa-9326-7f12a46d83e3","block_type":"box","text":"secured loans, senior unsecured loans, and subordinate corporate loans, including loans that may be","page_number":336,"box":{"x":116,"y":382,"width":756,"height":12}},{"id":"4be7e69f-fbd6-407b-8825-dae70dbadc9f","block_type":"box","text":"rated below investment grade or equivalent unrated loans, held by such issuer. Investments in a CLO","page_number":336,"box":{"x":117,"y":397,"width":757,"height":12}},{"id":"f1f322d0-dee4-46ff-a3bd-e7e1258d18d5","block_type":"box","text":"organized outside of the United States may not be deemed to be foreign securities if the CLO is","page_number":336,"box":{"x":116,"y":413,"width":715,"height":12}},{"id":"761e19d9-abef-4ecd-8f6f-a7e77470dbe7","block_type":"box","text":"collateralized by a pool of loans, a substantial portion of which are U.S. loans. Although certain CDOs","page_number":336,"box":{"x":116,"y":428,"width":758,"height":12}},{"id":"966ab909-c187-49f3-8999-e3b5d68ced8e","block_type":"box","text":"may benefit from credit enhancement in the form of a senior-subordinate structure, over","page_number":336,"box":{"x":117,"y":444,"width":655,"height":12}},{"id":"22ebaff6-485e-423e-bb8f-6fe645de42b6","block_type":"box","text":"collateralization or bond insurance, such enhancement may not always be present, and may fail to","page_number":336,"box":{"x":116,"y":459,"width":735,"height":12}},{"id":"6c5107b0-4568-48fe-9ee3-1b47875ade38","block_type":"box","text":"protect a Fund against the risk of loss on default of the collateral. Certain CDO issuers may use","page_number":336,"box":{"x":117,"y":475,"width":713,"height":12}},{"id":"78fb985e-081c-4d7e-9299-c3de3fa22182","block_type":"box","text":"derivatives contracts to create “synthetic” exposure to assets rather than holding such assets directly,","page_number":336,"box":{"x":116,"y":490,"width":758,"height":12}},{"id":"f66d8c43-5edc-4f2e-97b8-bbe44df824fa","block_type":"box","text":"which entails the risks of derivative instruments described elsewhere in this SAI. CDOs may charge","page_number":336,"box":{"x":116,"y":506,"width":742,"height":12}},{"id":"a7f17a9b-3019-4e90-ac0d-60697d340087","block_type":"box","text":"management fees and administrative expenses, which are in addition to those of a Fund.","page_number":336,"box":{"x":117,"y":521,"width":664,"height":12}},{"id":"800fe81d-c69f-4a4b-877c-cc91b409a898","block_type":"box","text":"For both CBOs and CLOs, the cash flows from the SPE are split into two or more portions, called","page_number":336,"box":{"x":117,"y":552,"width":724,"height":12}},{"id":"85e46bb6-b33d-45f1-94d4-7e38d96a1d14","block_type":"box","text":"tranches, varying in risk and yield. The riskiest portion is the “equity” tranche, which bears the first loss","page_number":336,"box":{"x":116,"y":568,"width":765,"height":12}},{"id":"f0f0407d-b453-427c-a0cb-6d348532eed8","block_type":"box","text":"from defaults from the bonds or loans in the SPE and serves to protect the other, more senior tranches","page_number":336,"box":{"x":116,"y":583,"width":768,"height":12}},{"id":"84f90340-561e-45fa-ab38-fc6a1cca700d","block_type":"box","text":"from default (though such protection is not complete). Since it is partially protected from defaults, a","page_number":336,"box":{"x":116,"y":599,"width":737,"height":12}},{"id":"f0bfe9f3-26d0-4261-a643-2eb4fb9805c6","block_type":"box","text":"senior tranche from a CBO or CLO typically has higher ratings and lower yields than its underlying","page_number":336,"box":{"x":116,"y":614,"width":733,"height":12}},{"id":"85d870fc-6ee9-4b8d-a175-8c571c555c9c","block_type":"box","text":"securities, and may be rated investment grade. Despite the protection from the equity tranche, CBO or","page_number":336,"box":{"x":116,"y":630,"width":765,"height":12}},{"id":"a6ae9956-51b2-43a3-959f-edc25ad411c0","block_type":"box","text":"CLO tranches can experience substantial losses due to actual defaults, downgrades of the underlying","page_number":336,"box":{"x":117,"y":645,"width":758,"height":12}},{"id":"4c8cda98-9b7f-431a-9256-db07b576c84e","block_type":"box","text":"collateral by rating agencies, forced liquidation of the collateral pool due to a failure of coverage tests,","page_number":336,"box":{"x":116,"y":661,"width":752,"height":12}},{"id":"36471534-11f2-4e24-babe-91939e41c246","block_type":"box","text":"increased sensitivity to defaults due to collateral default and disappearance of protecting tranches,","page_number":336,"box":{"x":117,"y":676,"width":728,"height":12}},{"id":"18c12f8c-96ea-4269-adb9-75bf1b796f62","block_type":"box","text":"market anticipation of defaults as well as investor aversion to CBO or CLO securities as a class.","page_number":336,"box":{"x":117,"y":692,"width":710,"height":12}},{"id":"dd23f5a6-b00a-4ca5-9dbc-41fb7ef2d0e9","block_type":"box","text":"Interest on certain tranches of a CDO may be paid in kind or deferred and capitalized (paid in the form","page_number":336,"box":{"x":117,"y":707,"width":757,"height":12}},{"id":"261722d8-3365-42d7-a8de-ea3b3f451a45","block_type":"box","text":"of obligations of the same type rather than cash), which involves continued exposure to default risk","page_number":336,"box":{"x":116,"y":723,"width":734,"height":12}},{"id":"fb6d7f03-c0f5-4696-a808-0499a575c2bb","block_type":"box","text":"with respect to such payments.","page_number":336,"box":{"x":116,"y":738,"width":229,"height":12}},{"id":"d56bd8da-5e2f-4a66-9cf5-804eb63f724a","block_type":"box","text":"The risks of an investment in a CDO depend largely on the type of the collateral securities and the","page_number":336,"box":{"x":116,"y":769,"width":728,"height":12}},{"id":"7d9141e7-efb3-4caa-b79f-29db3422bacf","block_type":"box","text":"class of the CDO in which a Fund invests. Normally, CBOs, CLOs and other CDOs are privately","page_number":336,"box":{"x":116,"y":785,"width":712,"height":12}},{"id":"d0129e53-f2f5-42dd-a688-7e7b845d567d","block_type":"box","text":"offered and sold, and thus are not registered under the securities laws. However, an active dealer","page_number":336,"box":{"x":116,"y":800,"width":725,"height":12}},{"id":"8e729cd0-69ac-479f-8590-072eb5f83308","block_type":"box","text":"market may exist for CDOs, allowing a CDO to qualify for Rule 144A transactions. In addition to the","page_number":336,"box":{"x":117,"y":816,"width":736,"height":12}},{"id":"93d6ff71-9644-432f-aae4-382c5e1e96d4","block_type":"box","text":"normal risks associated with fixed-income securities and asset-backed securities generally discussed","page_number":336,"box":{"x":117,"y":831,"width":755,"height":12}},{"id":"47bda3e3-1396-412c-8450-8facbcd6572f","block_type":"box","text":"elsewhere in this SAI, CDOs carry additional risks including, but not limited to: (i) the possibility that","page_number":336,"box":{"x":116,"y":847,"width":742,"height":12}},{"id":"738e400f-7902-4bc1-b0a5-60c7a6178eea","block_type":"box","text":"distributions from collateral securities will not be adequate to make interest or other payments; (ii) the","page_number":336,"box":{"x":116,"y":862,"width":756,"height":12}},{"id":"6f0bd9b8-3382-43b4-a856-afd267f5b9bd","block_type":"box","text":"risk that the collateral may default or decline in value or be downgraded, if rated by a nationally","page_number":336,"box":{"x":117,"y":878,"width":708,"height":12}},{"id":"7fbd6bbb-1a50-4e30-a699-78ce557a4b57","block_type":"box","text":"II-4","page_number":336,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"b4dd000e-b9dd-462e-8815-b3f62a6b210c","block_type":"box","text":"NM1026U-6004382-336/605","page_number":336,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4e9eb49c-afd2-4bc3-93d6-e8bf1509e8fb","block_type":"box","text":"recognized statistical rating organization (“NRSRO”); (iii) a Fund may invest in tranches of CDOs that","page_number":337,"box":{"x":117,"y":87,"width":754,"height":12}},{"id":"cec0666e-1433-4da5-b6e9-8b88419e4111","block_type":"box","text":"are subordinate to other tranches; (iv) the structure and complexity of the transaction and the legal","page_number":337,"box":{"x":116,"y":102,"width":736,"height":13}},{"id":"c9ecb0df-9076-4c43-a456-98047388c3cc","block_type":"box","text":"documents could lead to disputes among investors regarding the characterization of proceeds; (v) the","page_number":337,"box":{"x":116,"y":118,"width":760,"height":12}},{"id":"88c9b869-8560-46e5-8275-290a4ec026d5","block_type":"box","text":"investment return achieved by the Fund could be significantly different than those predicted by financial","page_number":337,"box":{"x":117,"y":134,"width":771,"height":12}},{"id":"5c5693d7-a2d5-482c-96ff-b5d787a1f4cd","block_type":"box","text":"models; (vi) the lack of a readily available secondary market for CDOs; (vii) the risk of forced “fire sale”","page_number":337,"box":{"x":117,"y":149,"width":765,"height":12}},{"id":"eaa2a932-b463-4ad4-b396-80a30a4d2301","block_type":"box","text":"liquidation due to technical defaults such as coverage test failures; and (viii) the CDO’s manager may","page_number":337,"box":{"x":117,"y":165,"width":756,"height":12}},{"id":"b68147ed-5bb7-432b-bfce-bc064db96d81","block_type":"box","text":"perform poorly.","page_number":337,"box":{"x":117,"y":180,"width":117,"height":12}},{"id":"9b943e74-90c1-4890-8c4c-17be8158023b","block_type":"box","text":"Commercial Paper.","page_number":337,"box":{"x":117,"y":211,"width":150,"height":12}},{"id":"d0f67c89-9b8d-429f-bf16-fa1f6ff421ab","block_type":"box","text":"Certain Funds may purchase commercial paper. Commercial paper purchasable","page_number":337,"box":{"x":268,"y":211,"width":607,"height":12}},{"id":"4224a39a-2cd8-473e-93e0-e229f4445ff1","block_type":"box","text":"by each Fund includes “Section 4(a)(2) paper,” a term that includes debt obligations issued in reliance","page_number":337,"box":{"x":117,"y":227,"width":760,"height":12}},{"id":"66f6e580-e119-4176-870a-ddb7ea144ad9","block_type":"box","text":"on the “private placement” exemption from registration afforded by Section 4(a)(2) of the Securities","page_number":337,"box":{"x":116,"y":242,"width":739,"height":12}},{"id":"3103aa78-5b6f-45ea-9196-3df44609c891","block_type":"box","text":"Act. Section 4(a)(2) paper is restricted as to disposition under the Federal securities laws, and is","page_number":337,"box":{"x":116,"y":258,"width":719,"height":12}},{"id":"833a26de-affb-4bfa-a9d3-7871ec64e404","block_type":"box","text":"frequently sold (and resold) to institutional investors such as the Fund through or with the assistance of","page_number":337,"box":{"x":116,"y":273,"width":769,"height":12}},{"id":"87da813d-5d42-4a86-8655-e3ab4cf0e4c3","block_type":"box","text":"investment dealers who make a market in the Section 4(a)(2) paper, thereby providing liquidity. Certain","page_number":337,"box":{"x":117,"y":289,"width":769,"height":12}},{"id":"05f9585c-85cc-4487-a581-bec904289217","block_type":"box","text":"transactions in Section 4(a)(2) paper may qualify for the registration exemption provided in Rule 144A","page_number":337,"box":{"x":116,"y":304,"width":759,"height":12}},{"id":"4bb9fbac-d22c-49a3-a4c1-e55e03a3ad87","block_type":"box","text":"under the Securities Act. Most Funds can purchase commercial paper rated (at the time of purchase)","page_number":337,"box":{"x":117,"y":320,"width":754,"height":12}},{"id":"850a0597-5b8e-4900-b6e0-61b9804f7a92","block_type":"box","text":"“A-1” by S&P or “Prime-1” by Moody’s or when deemed advisable by a Fund’s Manager or sub-adviser,","page_number":337,"box":{"x":116,"y":335,"width":772,"height":12}},{"id":"2b5588a3-5b31-4ecd-91af-ad6c1c705e62","block_type":"box","text":"“high quality” issues rated “A-2”, “Prime-2” or “F-2” by S&P, Moody’s or Fitch, respectively.","page_number":337,"box":{"x":116,"y":351,"width":675,"height":12}},{"id":"1511c64f-cffd-43b9-b894-1ea489776748","block_type":"box","text":"Commercial paper is generally considered to be short-term unsecured debt of corporations. Like all","page_number":337,"box":{"x":117,"y":382,"width":740,"height":12}},{"id":"40e7df80-873d-47b1-9261-a970ef73e5ad","block_type":"box","text":"fixed income securities, commercial paper prices are susceptible to fluctuations in interest rates. If","page_number":337,"box":{"x":116,"y":397,"width":732,"height":12}},{"id":"133a46d0-1133-4c62-8561-ad70ec7d341d","block_type":"box","text":"interest rates rise, commercial paper prices will decline and vice versa. However, the short-term nature","page_number":337,"box":{"x":117,"y":413,"width":767,"height":12}},{"id":"1747e033-d07d-4dfd-be9b-c3e82f2b8a38","block_type":"box","text":"of a commercial paper investment generally makes it less susceptible to volatility than many other fixed","page_number":337,"box":{"x":116,"y":428,"width":771,"height":12}},{"id":"645459a7-1178-404f-a997-4674aa20ac9d","block_type":"box","text":"income securities because interest rate risk typically increases as maturity lengths increase.","page_number":337,"box":{"x":117,"y":444,"width":686,"height":12}},{"id":"556f9e5a-04a9-4da8-9269-87cc96cb077e","block_type":"box","text":"Commercial paper tends to yield smaller returns than longer-term corporate debt because securities","page_number":337,"box":{"x":117,"y":459,"width":746,"height":12}},{"id":"e68ad32f-4d02-4032-ad4b-0d0b666cb1ee","block_type":"box","text":"with shorter maturities typically have lower effective yields than those with longer maturities.","page_number":337,"box":{"x":116,"y":475,"width":686,"height":12}},{"id":"93a3087b-78e8-440c-b182-59f6e83d7d0b","block_type":"box","text":"Commodity-Linked Derivative Instruments and Hybrid Instruments.","page_number":337,"box":{"x":117,"y":506,"width":535,"height":12}},{"id":"2fc89974-bd3f-426b-a40e-0e19459fe127","block_type":"box","text":"Certain Funds seek to gain","page_number":337,"box":{"x":653,"y":506,"width":210,"height":12}},{"id":"4becca2b-9152-46d4-a28b-867d9ca40938","block_type":"box","text":"exposure to the commodities markets primarily through investments in hybrid instruments. Hybrid","page_number":337,"box":{"x":116,"y":521,"width":727,"height":12}},{"id":"afa53117-dfd1-49f6-a3f5-ab86fb899def","block_type":"box","text":"instruments are either equity or debt derivative securities with one or more commodity-dependent","page_number":337,"box":{"x":117,"y":537,"width":727,"height":12}},{"id":"b29b27db-6ef4-4b1b-acf3-f34ccca01f96","block_type":"box","text":"components that have payment features similar to a commodity futures contract, a commodity option","page_number":337,"box":{"x":116,"y":552,"width":753,"height":12}},{"id":"f26d49b7-f6a4-4b10-8084-7c1b2421aa9c","block_type":"box","text":"contract, or a combination of both. Therefore, these instruments are “commodity-linked.” They are","page_number":337,"box":{"x":116,"y":568,"width":731,"height":12}},{"id":"3a0843e6-99d6-4348-a74f-f09f6dcfde1d","block_type":"box","text":"considered “hybrid” instruments because they have both commodity-like and security-like","page_number":337,"box":{"x":116,"y":583,"width":667,"height":12}},{"id":"aad0ff04-ac58-4802-83a8-1f7ac70d0327","block_type":"box","text":"characteristics. Hybrid instruments are derivative instruments because at least part of their value is","page_number":337,"box":{"x":116,"y":599,"width":738,"height":12}},{"id":"804dfe6c-e2ad-499c-9bc5-7f33f99a2844","block_type":"box","text":"derived from the value of an underlying commodity, futures contract, index or other readily measurable","page_number":337,"box":{"x":116,"y":614,"width":766,"height":12}},{"id":"ddef8a48-1603-4cb5-81de-5801f3cbef2c","block_type":"box","text":"economic variable.","page_number":337,"box":{"x":116,"y":630,"width":145,"height":9}},{"id":"df1c82e2-974c-4e20-a134-77e3fb2e9d18","block_type":"box","text":"The prices of commodity-linked derivative instruments may move in different directions than","page_number":337,"box":{"x":116,"y":661,"width":680,"height":12}},{"id":"8ba2cd62-63f7-4f13-8e7f-f1ba26a4bbf6","block_type":"box","text":"investments in traditional equity and debt securities when the value of those traditional securities is","page_number":337,"box":{"x":117,"y":676,"width":731,"height":12}},{"id":"941fc425-92c0-4ddb-90ac-311c0aa34a44","block_type":"box","text":"declining due to adverse economic conditions. As an example, during periods of rising inflation, debt","page_number":337,"box":{"x":116,"y":692,"width":744,"height":12}},{"id":"d8126c15-db84-4ea1-bbec-105e64061503","block_type":"box","text":"securities have historically tended to decline in value due to the general increase in prevailing interest","page_number":337,"box":{"x":116,"y":707,"width":753,"height":12}},{"id":"6ad2928f-0637-4d0f-941b-6a42cc0b42f0","block_type":"box","text":"rates. Conversely, during those same periods of rising inflation, the prices of certain commodities, such","page_number":337,"box":{"x":117,"y":723,"width":763,"height":12}},{"id":"4f786b5a-b9de-4d02-9573-c2672d1ae9c2","block_type":"box","text":"as oil and metals, have historically tended to increase. Of course, there cannot be any guarantee that","page_number":337,"box":{"x":116,"y":738,"width":752,"height":12}},{"id":"920db939-1a6e-4022-a52a-78bac57363ea","block_type":"box","text":"these investments will perform in that manner in the future, and at certain times the price movements","page_number":337,"box":{"x":116,"y":754,"width":749,"height":12}},{"id":"5fa7af94-4b2d-4912-a02a-956277e59ddc","block_type":"box","text":"of commodity-linked instruments have been parallel to those of debt and equity securities.","page_number":337,"box":{"x":116,"y":769,"width":665,"height":12}},{"id":"11462399-b15b-4049-b12d-8ebccbcc7672","block_type":"box","text":"Commodities have historically tended to increase and decrease in value during different parts of the","page_number":337,"box":{"x":117,"y":785,"width":739,"height":12}},{"id":"d3a511dd-042d-4ab1-a50b-a9267c827090","block_type":"box","text":"business cycle than financial assets. Nevertheless, at various times, commodities prices may move in","page_number":337,"box":{"x":117,"y":800,"width":753,"height":12}},{"id":"381d8bb2-678b-4591-a03f-91cd2a95294f","block_type":"box","text":"tandem with the prices of financial assets and thus may not provide overall portfolio diversification","page_number":337,"box":{"x":116,"y":816,"width":725,"height":12}},{"id":"d792aeb2-0568-43a8-8ff7-0eabc457a8ce","block_type":"box","text":"benefits. Under favorable economic conditions, the Fund’s investments may be expected to under","page_number":337,"box":{"x":117,"y":831,"width":731,"height":12}},{"id":"d1e51d3b-0661-4e2e-bdd1-83701647137d","block_type":"box","text":"perform an investment in traditional securities. Over the long term, the returns on the Fund’s","page_number":337,"box":{"x":117,"y":847,"width":688,"height":12}},{"id":"28f2639a-09f9-456b-b95b-9333b6bbe294","block_type":"box","text":"investments are expected to exhibit low or negative correlation with stocks and bonds.","page_number":337,"box":{"x":117,"y":862,"width":643,"height":12}},{"id":"3130745b-3971-4a38-9e0e-f8fb7aa83ba9","block_type":"box","text":"II-5","page_number":337,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"9da60cd3-2cb0-43f9-a630-4b32541bea03","block_type":"box","text":"NM1026U-6004382-337/605","page_number":337,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6a89718a-8162-4700-9ed1-dbc8183d34a1","block_type":"box","text":"Qualifying Hybrid Instruments.","page_number":338,"box":{"x":117,"y":87,"width":222,"height":12}},{"id":"f09944e0-9c75-4eda-8bd3-edb782fa0cb7","block_type":"box","text":"Certain Funds may invest in hybrid instruments that qualify for exclusion","page_number":338,"box":{"x":341,"y":87,"width":546,"height":12}},{"id":"324a14f0-84b8-4529-86a4-60db78fa40ca","block_type":"box","text":"from regulation under the Commodity Exchange Act and the regulations adopted thereunder. A hybrid","page_number":338,"box":{"x":116,"y":102,"width":761,"height":13}},{"id":"a6f54ad0-7c9e-45a1-a4c9-afc3dd88ba39","block_type":"box","text":"instrument that qualifies for this exclusion from regulation must be “predominantly a security.” A hybrid","page_number":338,"box":{"x":117,"y":118,"width":762,"height":12}},{"id":"a0f985ef-715d-4f92-8b5a-65944bfc62df","block_type":"box","text":"instrument is considered to be predominantly a security if (a) the issuer of the hybrid instrument","page_number":338,"box":{"x":117,"y":134,"width":712,"height":12}},{"id":"f8bcc4c9-4542-489e-b9dc-c24dcda473a1","block_type":"box","text":"receives payment in full of the purchase price of the hybrid instrument, substantially","page_number":338,"box":{"x":117,"y":149,"width":624,"height":12}},{"id":"939a518f-fae0-4fe5-9549-d9fdf985f790","block_type":"box","text":"contemporaneously with delivery of the hybrid instrument; (b) the purchaser or holder of the hybrid","page_number":338,"box":{"x":116,"y":165,"width":735,"height":12}},{"id":"4e6a888d-9fc6-4696-ae50-cd5399630f3e","block_type":"box","text":"instrument is not required to make any payment to the issuer in addition to the purchase price paid","page_number":338,"box":{"x":117,"y":180,"width":735,"height":12}},{"id":"c2e5c43d-6368-49de-a7c4-6bd1530e7df8","block_type":"box","text":"under subparagraph (a), whether as margin, settlement payment, or otherwise, during the life of the","page_number":338,"box":{"x":117,"y":196,"width":743,"height":12}},{"id":"0271690a-17d7-4e27-bd29-ea2f789b2d37","block_type":"box","text":"hybrid instrument or at maturity; (c) the issuer of the hybrid instrument is not subject by the terms of the","page_number":338,"box":{"x":117,"y":211,"width":770,"height":12}},{"id":"5ff851f1-5385-4f4a-b256-1d86bef9af61","block_type":"box","text":"instrument to mark-to-market margining requirements; and (d) the hybrid instrument is not marketed as","page_number":338,"box":{"x":117,"y":227,"width":768,"height":12}},{"id":"0cb0dab8-4c07-457d-a207-1e14686e566f","block_type":"box","text":"a contract of sale of a commodity for future delivery (or option on such a contract) subject to applicable","page_number":338,"box":{"x":116,"y":242,"width":768,"height":12}},{"id":"09e10d94-d218-430b-b2b8-ee3e5b6a2524","block_type":"box","text":"provisions of the Commodity Exchange Act. Hybrid instruments may be principal protected, partially","page_number":338,"box":{"x":117,"y":258,"width":743,"height":12}},{"id":"f1fa6061-a1c0-42ce-a680-1ae3dd993497","block_type":"box","text":"protected, or offer no principal protection. A principal protected hybrid instrument means that the issuer","page_number":338,"box":{"x":117,"y":273,"width":768,"height":12}},{"id":"d023dca8-4317-49a1-bbd6-d76b2caa0968","block_type":"box","text":"will pay, at a minimum, the par value of the note at maturity. Therefore, if the commodity value to which","page_number":338,"box":{"x":116,"y":289,"width":770,"height":12}},{"id":"d341c5c8-d0cf-49c3-a6da-de9f7e16f0e7","block_type":"box","text":"the hybrid instrument is linked declines over the life of the note, the Fund will receive at maturity the","page_number":338,"box":{"x":116,"y":304,"width":744,"height":12}},{"id":"2fce34ef-cc52-4c52-83a1-bae8679cf80a","block_type":"box","text":"face or stated value of the note. With a principal protected hybrid instrument, the Fund will receive at","page_number":338,"box":{"x":116,"y":320,"width":750,"height":12}},{"id":"fb9731e3-76fb-4e4a-b2a0-0389197a3200","block_type":"box","text":"maturity the greater of the par value of the note or the increase in its value based on the underlying","page_number":338,"box":{"x":117,"y":335,"width":739,"height":12}},{"id":"5f7471b4-cfa4-42e6-9d73-c297cfb004f6","block_type":"box","text":"commodity or index. This protection is, in effect, an option whose value is subject to the volatility and","page_number":338,"box":{"x":116,"y":351,"width":751,"height":12}},{"id":"36f9f9a4-0338-4b66-967f-33f27a2a2bcb","block_type":"box","text":"price level of the underlying commodity. The Manager’s decision whether to use principal protection","page_number":338,"box":{"x":117,"y":366,"width":743,"height":12}},{"id":"a1e00a42-7763-40c8-b871-d8f423b06ec3","block_type":"box","text":"depends in part on the cost of the protection. In addition, the protection feature depends upon the","page_number":338,"box":{"x":116,"y":382,"width":728,"height":12}},{"id":"4134d1f1-435f-4f05-818c-46a3e1c4bb6b","block_type":"box","text":"ability of the issuer to meet its obligation to buy back the security, and, therefore, depends on the","page_number":338,"box":{"x":116,"y":397,"width":724,"height":12}},{"id":"2f0987f5-3be1-4a2d-b183-c712af457026","block_type":"box","text":"creditworthiness of the issuer. With full principal protection, the Fund will receive at maturity of the","page_number":338,"box":{"x":116,"y":413,"width":731,"height":12}},{"id":"dc52577f-77c1-4300-a5a6-0d1334fdd40b","block_type":"box","text":"hybrid instrument either the stated par value of the hybrid instrument, or potentially, an amount greater","page_number":338,"box":{"x":117,"y":428,"width":764,"height":12}},{"id":"6eedea27-947e-4a33-b8ae-4dea4c69803b","block_type":"box","text":"than the stated par value if the underlying commodity, index, futures contract or economic variable to","page_number":338,"box":{"x":116,"y":444,"width":753,"height":12}},{"id":"17cf9454-ab20-48dd-bb59-6e634156ae9f","block_type":"box","text":"which the hybrid instrument is linked has increased in value. Partially protected hybrid instruments may","page_number":338,"box":{"x":116,"y":459,"width":770,"height":12}},{"id":"816dcfcf-3a6a-4a38-b9b9-1fa23a0f53e7","block_type":"box","text":"suffer some loss of principal if the underlying commodity, index, futures contract or economic variable","page_number":338,"box":{"x":116,"y":475,"width":758,"height":12}},{"id":"68850d95-1c23-4741-88f1-da83e2078349","block_type":"box","text":"to which the hybrid instrument is linked declines in value during the term of the hybrid instrument.","page_number":338,"box":{"x":116,"y":490,"width":726,"height":12}},{"id":"5666d870-e6f5-4c2f-b5b4-2be0ec09a268","block_type":"box","text":"However, partially protected hybrid instruments have a specified limit as to the amount of principal that","page_number":338,"box":{"x":117,"y":506,"width":764,"height":12}},{"id":"bd02b5be-7891-4887-8a6f-1f37044f7fbd","block_type":"box","text":"they may lose.","page_number":338,"box":{"x":116,"y":521,"width":113,"height":12}},{"id":"7ab5cb9c-d81a-4f61-94d9-b148493ec77b","block_type":"box","text":"Hybrid Instruments Without Principal Protection.","page_number":338,"box":{"x":116,"y":552,"width":355,"height":12}},{"id":"4a1fbce8-b5ec-47d8-b1e1-4cbcd974e0ba","block_type":"box","text":"Certain Funds may invest in hybrid instruments that","page_number":338,"box":{"x":473,"y":552,"width":393,"height":12}},{"id":"2afa7acf-3800-436a-b6df-802dce31093f","block_type":"box","text":"offer no principal protection. At maturity, there is a risk that the underlying commodity price, futures","page_number":338,"box":{"x":116,"y":568,"width":738,"height":12}},{"id":"792f6e47-7133-45ce-89d4-313d019e8b72","block_type":"box","text":"contract, index or other economic variable may have declined sufficiently in value such that some or all","page_number":338,"box":{"x":116,"y":583,"width":768,"height":12}},{"id":"b11a8b8f-3ad6-4b9d-9d75-5dd962f9419f","block_type":"box","text":"of the face value of the hybrid instrument might not be returned. The Manager, at its discretion, may","page_number":338,"box":{"x":116,"y":599,"width":746,"height":12}},{"id":"8effb6b0-df52-4285-9548-2cfd0cf61836","block_type":"box","text":"invest in a partially protected principal structured note or a note without principal protection. In deciding","page_number":338,"box":{"x":117,"y":614,"width":767,"height":12}},{"id":"6d74b128-62af-4e52-8b1a-02501c91d7c7","block_type":"box","text":"to purchase a note without principal protection, the Manager may consider, among other things, the","page_number":338,"box":{"x":116,"y":630,"width":743,"height":12}},{"id":"af551f4f-cf14-4c00-9d04-8cdb53efee44","block_type":"box","text":"expected performance of the underlying commodity futures contract, index or other economic variable","page_number":338,"box":{"x":116,"y":645,"width":761,"height":12}},{"id":"704ff6e2-be19-41b3-8478-84400d8fda96","block_type":"box","text":"over the term of the note, the cost of the note, and any other economic factors that the Manager","page_number":338,"box":{"x":116,"y":661,"width":713,"height":12}},{"id":"7e7072bf-c585-4f7f-acec-fa5db0382577","block_type":"box","text":"believes are relevant.","page_number":338,"box":{"x":117,"y":676,"width":157,"height":10}},{"id":"0ace939c-224e-4164-a4d7-90a2d9a862d4","block_type":"box","text":"Limitations on Leverage.","page_number":338,"box":{"x":116,"y":707,"width":181,"height":12}},{"id":"95c0f844-cb3f-4941-9372-55a056f4126b","block_type":"box","text":"Some of the hybrid instruments in which a Fund may invest may involve","page_number":338,"box":{"x":304,"y":707,"width":534,"height":12}},{"id":"318326f8-bfc5-4073-b021-773ec64e88e0","block_type":"box","text":"leverage. To avoid being subject to undue leverage risk, a Fund will seek to limit the amount of","page_number":338,"box":{"x":117,"y":723,"width":703,"height":12}},{"id":"72957812-2f30-4417-ab50-a5c89abffca8","block_type":"box","text":"economic leverage it has under any one hybrid instrument that it buys and the leverage of the Fund’s","page_number":338,"box":{"x":116,"y":738,"width":750,"height":12}},{"id":"4983719b-2116-40a3-b43e-b0cd548a6057","block_type":"box","text":"overall portfolio. A Fund will not invest in a hybrid instrument if, at the time of purchase: (i) that","page_number":338,"box":{"x":116,"y":754,"width":699,"height":12}},{"id":"acb674e2-af97-4f03-88bf-f5ed04391fd5","block_type":"box","text":"instrument’s “leverage ratio” exceeds 300% of the price increase in the underlying commodity, futures","page_number":338,"box":{"x":117,"y":769,"width":753,"height":12}},{"id":"d0111867-3f93-4e97-a09e-32fb0514d659","block_type":"box","text":"contract, index or other economic variable or (ii) the Fund’s “portfolio leverage ratio” exceeds 150%,","page_number":338,"box":{"x":116,"y":785,"width":739,"height":12}},{"id":"8463931e-1447-453e-b3d1-47edb726ba78","block_type":"box","text":"measured at the time of purchase. “Leverage ratio” is the expected increase in the value of a hybrid","page_number":338,"box":{"x":117,"y":800,"width":737,"height":12}},{"id":"881dc5f1-2ffd-4e6c-ba7e-71be17ea4d50","block_type":"box","text":"instrument, assuming a one percent price increase in the underlying commodity, futures contract, index","page_number":338,"box":{"x":117,"y":816,"width":765,"height":12}},{"id":"efec533c-9daa-40a6-86a2-5e6b33fe9ea4","block_type":"box","text":"or other economic factor. In other words, for a hybrid instrument with a leverage factor of 150%, a 1%","page_number":338,"box":{"x":116,"y":831,"width":758,"height":12}},{"id":"4bb2959a-1819-44d7-a203-5cb1b15b34ba","block_type":"box","text":"gain in the underlying economic variable would be expected to result in a 1.5% gain in value for the","page_number":338,"box":{"x":116,"y":847,"width":741,"height":12}},{"id":"28498184-2c81-4a95-a745-19e7c8060ec3","block_type":"box","text":"hybrid instrument. Conversely, a hybrid instrument with a leverage factor of 150% would suffer a 1.5%","page_number":338,"box":{"x":117,"y":862,"width":762,"height":12}},{"id":"15c8fc88-159e-40f4-a84c-92a47c20a1d7","block_type":"box","text":"loss if the underlying economic variable lost 1% of its value. “Portfolio leverage ratio” is defined as the","page_number":338,"box":{"x":117,"y":878,"width":758,"height":12}},{"id":"bf6a140e-603a-4b0b-baa1-ce04126c8a49","block_type":"box","text":"II-6","page_number":338,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"e51c2021-a038-499d-856c-1c952991d813","block_type":"box","text":"NM1026U-6004382-338/605","page_number":338,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f91615e7-69e7-4161-8a35-458395935e14","block_type":"box","text":"average (mean) leverage ratio of all instruments in a Fund’s portfolio, weighted by the market values of","page_number":339,"box":{"x":116,"y":87,"width":769,"height":12}},{"id":"c9d35142-10a5-4da5-b802-51ced8f132c2","block_type":"box","text":"such instruments or, in the case of futures contracts, their notional values. A Fund may at times or from","page_number":339,"box":{"x":116,"y":102,"width":771,"height":13}},{"id":"194189b4-cd4e-4f5a-a8ac-87a8e377254a","block_type":"box","text":"time to time decide not to use leverage in its investments or use less leverage than may otherwise be","page_number":339,"box":{"x":116,"y":118,"width":757,"height":12}},{"id":"6f22a5b0-b7d0-4398-94f9-6c3297b53b3d","block_type":"box","text":"allowable.","page_number":339,"box":{"x":116,"y":134,"width":79,"height":9}},{"id":"3b98d5f5-e2ea-4f99-82f1-e6595432af01","block_type":"box","text":"Counterparty Risk.","page_number":339,"box":{"x":117,"y":165,"width":136,"height":12}},{"id":"933045f5-7ad1-431a-bdac-163c198cfcc8","block_type":"box","text":"A significant risk of hybrid instruments is counterparty risk. Unlike exchange-traded","page_number":339,"box":{"x":255,"y":165,"width":625,"height":12}},{"id":"78a1bf22-46f9-4cb6-b0d7-4cc437a906d3","block_type":"box","text":"futures and options, which are standard contracts, hybrid instruments are customized securities, tailor","page_number":339,"box":{"x":116,"y":180,"width":760,"height":12}},{"id":"d2990632-5ecf-404b-a152-b2d763e5b0fb","block_type":"box","text":"made by a specific issuer. With a listed futures or options contract, an investor’s counterparty is the","page_number":339,"box":{"x":117,"y":196,"width":740,"height":12}},{"id":"7508d194-3aa8-4164-8de9-2a323487346c","block_type":"box","text":"exchange clearinghouse. Exchange clearinghouses are capitalized by the exchange members and","page_number":339,"box":{"x":116,"y":211,"width":738,"height":12}},{"id":"1edae9e0-3abf-45df-b044-99455bb8c0ca","block_type":"box","text":"typically have high investment grade ratings (","page_number":339,"box":{"x":116,"y":227,"width":336,"height":12}},{"id":"0bf1480c-7314-427f-b7eb-adbd81236c01","block_type":"box","text":"e.g.","page_number":339,"box":{"x":453,"y":229,"width":26,"height":10}},{"id":"2c9e4541-d198-4d7c-af72-d486c45a6ddb","block_type":"box","text":", ratings of AAA or AA by S&P). Therefore, the risk is","page_number":339,"box":{"x":482,"y":227,"width":396,"height":12}},{"id":"91af2c4a-e275-4e3c-a20b-fd44f1d59091","block_type":"box","text":"small that an exchange clearinghouse might be unable to meet its obligations at maturity. However,","page_number":339,"box":{"x":116,"y":242,"width":743,"height":12}},{"id":"19235a0c-96d6-490f-af7d-e2fa05d5ef87","block_type":"box","text":"with a hybrid instrument, a Fund will take on the counterparty credit risk of the issuer. That is, at","page_number":339,"box":{"x":116,"y":258,"width":715,"height":12}},{"id":"575240e6-45c9-4105-bdc6-00e73ba928ec","block_type":"box","text":"maturity of the hybrid instrument, there is a risk that the issuer may be unable to perform its obligations","page_number":339,"box":{"x":117,"y":273,"width":767,"height":12}},{"id":"61ae97f4-a2ec-4c89-8e72-823245e1e4b6","block_type":"box","text":"under the structured note.","page_number":339,"box":{"x":117,"y":289,"width":196,"height":9}},{"id":"df09bef6-74dc-4134-b846-9e4bddf3d73e","block_type":"box","text":"Convertible Securities.","page_number":339,"box":{"x":117,"y":320,"width":180,"height":9}},{"id":"6a8eb166-b3bf-4420-ad4a-670ea4b0df21","block_type":"box","text":"A convertible security is a bond, debenture, note, preferred stock or other","page_number":339,"box":{"x":298,"y":320,"width":554,"height":12}},{"id":"b70123c2-4770-4087-b79d-892aebfb924f","block_type":"box","text":"security that may be converted into or exchanged for a prescribed amount of common stock or other","page_number":339,"box":{"x":116,"y":335,"width":750,"height":12}},{"id":"440bd24c-2951-48d1-b498-4d204cc2bbdb","block_type":"box","text":"equity security of the same or a different issuer within a particular period of time at a specified price or","page_number":339,"box":{"x":116,"y":351,"width":761,"height":12}},{"id":"40d4f397-f490-46ce-bfe2-a37e4e543dfd","block_type":"box","text":"formula. A convertible security entitles the holder to receive interest paid or accrued on debt or the","page_number":339,"box":{"x":116,"y":366,"width":734,"height":12}},{"id":"1079e3d0-ebfc-4f75-a7da-74103001c2b6","block_type":"box","text":"dividend paid on preferred stock until the convertible security matures or is redeemed, converted or","page_number":339,"box":{"x":116,"y":382,"width":742,"height":12}},{"id":"95937a6b-6ea8-422d-8863-549974de9a61","block_type":"box","text":"exchanged. Before conversion, convertible securities have characteristics similar to nonconvertible","page_number":339,"box":{"x":116,"y":397,"width":738,"height":12}},{"id":"f0e20e92-14d9-48d6-81d7-8d8ba99637bf","block_type":"box","text":"income securities in that they ordinarily provide a stable stream of income with generally higher yields","page_number":339,"box":{"x":117,"y":413,"width":757,"height":12}},{"id":"ef2b6f5d-1a08-41a1-8de7-313ff5541b5d","block_type":"box","text":"than those of common stocks of the same or similar issuers, but lower yields than comparable","page_number":339,"box":{"x":116,"y":428,"width":703,"height":12}},{"id":"5d0bfce3-de00-45f7-b8ce-3b095d62c3cd","block_type":"box","text":"nonconvertible securities. The value of a convertible security is influenced by changes in interest rates,","page_number":339,"box":{"x":117,"y":444,"width":767,"height":12}},{"id":"2c799840-d06d-40ca-9eed-6db15ba76b6a","block_type":"box","text":"with investment value declining as interest rates increase and increasing as interest rates decline. The","page_number":339,"box":{"x":116,"y":459,"width":764,"height":12}},{"id":"5a060413-a1a9-434d-b7b3-7bce96d57b8f","block_type":"box","text":"credit standing of the issuer and other factors also may have an effect on the convertible security’s","page_number":339,"box":{"x":116,"y":475,"width":736,"height":12}},{"id":"babb53d7-bf3f-4e27-912a-7fa274db95c3","block_type":"box","text":"investment value. Convertible securities rank senior to common stock in a corporation’s capital","page_number":339,"box":{"x":117,"y":490,"width":706,"height":12}},{"id":"3301080b-61ba-427f-af88-7387bf4b5f69","block_type":"box","text":"structure but are usually subordinated to comparable nonconvertible securities. Convertible securities","page_number":339,"box":{"x":116,"y":506,"width":757,"height":12}},{"id":"0d996904-82bc-4858-a27f-7718284851ca","block_type":"box","text":"may be subject to redemption at the option of the issuer at a price established in the convertible","page_number":339,"box":{"x":117,"y":521,"width":714,"height":12}},{"id":"9f1c8439-152a-4079-ae82-e84ee6ce600a","block_type":"box","text":"security’s governing instrument.","page_number":339,"box":{"x":116,"y":537,"width":241,"height":12}},{"id":"7dc8a5b4-6700-455f-b57b-a50afa42d86f","block_type":"box","text":"The characteristics of convertible securities make them potentially attractive investments for an","page_number":339,"box":{"x":116,"y":568,"width":710,"height":12}},{"id":"e7c1b2b7-3d70-42b2-8e24-f6cadc365087","block_type":"box","text":"investment company seeking a high total return from capital appreciation and investment income.","page_number":339,"box":{"x":117,"y":583,"width":727,"height":12}},{"id":"7ae422be-be84-4ea4-9037-2d7d348d9101","block_type":"box","text":"These characteristics include the potential for capital appreciation as the value of the underlying","page_number":339,"box":{"x":116,"y":599,"width":716,"height":12}},{"id":"7172c62f-e141-47d7-82f8-37de0dfc6218","block_type":"box","text":"common stock increases, the relatively high yield received from dividend or interest payments as","page_number":339,"box":{"x":116,"y":614,"width":723,"height":12}},{"id":"25912dfd-395c-4195-a07a-5613716e4a8c","block_type":"box","text":"compared to common stock dividends and decreased risks of decline in value relative to the underlying","page_number":339,"box":{"x":116,"y":630,"width":770,"height":12}},{"id":"8270f849-1d06-49cc-9930-99115b6f6102","block_type":"box","text":"common stock due to their fixed-income nature. As a result of the conversion feature, however, the","page_number":339,"box":{"x":116,"y":645,"width":739,"height":11}},{"id":"f455821e-dd95-47c7-b347-f0ecdab3b82a","block_type":"box","text":"interest rate or dividend preference on a convertible security is generally less than would be the case if","page_number":339,"box":{"x":117,"y":661,"width":762,"height":12}},{"id":"c0a37c39-a058-4739-bb56-fd5d485cce3b","block_type":"box","text":"the securities were issued in nonconvertible form.","page_number":339,"box":{"x":116,"y":676,"width":367,"height":10}},{"id":"f8233b4a-5063-45f1-adf5-cfa8388919c0","block_type":"box","text":"In analyzing convertible securities, the Manager will consider both the yield on the convertible security","page_number":339,"box":{"x":117,"y":707,"width":755,"height":12}},{"id":"c6172322-8767-452c-abe4-6add1644ea26","block_type":"box","text":"relative to its credit quality and the potential capital appreciation that is offered by the underlying","page_number":339,"box":{"x":117,"y":723,"width":710,"height":12}},{"id":"afdf75f0-5bfd-4818-9309-0e24b556c8e6","block_type":"box","text":"common stock, among other things.","page_number":339,"box":{"x":116,"y":738,"width":265,"height":12}},{"id":"2a75ea1d-3d89-431d-926e-5854c168b41c","block_type":"box","text":"Convertible securities are issued and traded in a number of securities markets. Even in cases where a","page_number":339,"box":{"x":117,"y":769,"width":758,"height":10}},{"id":"64b6addf-f8b7-4359-a47c-17be116fb4c4","block_type":"box","text":"substantial portion of the convertible securities held by a Fund are denominated in U.S. dollars, the","page_number":339,"box":{"x":116,"y":785,"width":734,"height":12}},{"id":"7241878d-a45f-4a28-98fe-3166e5271a0b","block_type":"box","text":"underlying equity securities may be quoted in the currency of the country where the issuer is domiciled.","page_number":339,"box":{"x":117,"y":800,"width":764,"height":12}},{"id":"4a58f29e-6063-4490-b3ac-a48793b7fc8a","block_type":"box","text":"As a result, fluctuations in the exchange rate between the currency in which the debt security is","page_number":339,"box":{"x":116,"y":816,"width":707,"height":12}},{"id":"e78c4840-43aa-4bf2-a2ca-ca98cedd21ec","block_type":"box","text":"denominated and the currency in which the share price is quoted will affect the value of the convertible","page_number":339,"box":{"x":116,"y":831,"width":766,"height":12}},{"id":"c73d9092-66af-49c9-9d21-eebdea1bd802","block_type":"box","text":"security. With respect to convertible securities denominated in a currency different from that of the","page_number":339,"box":{"x":116,"y":847,"width":733,"height":12}},{"id":"cc01aac9-4f5d-4295-a9e9-c438230b9dcc","block_type":"box","text":"underlying equity securities, the conversion price may be based on a fixed exchange rate established","page_number":339,"box":{"x":117,"y":862,"width":756,"height":12}},{"id":"8e1cbdc3-71c2-4b0c-b1a4-1a030be8ab46","block_type":"box","text":"at the time the security is issued, which may increase the effects of currency risk. As described below,","page_number":339,"box":{"x":116,"y":878,"width":763,"height":12}},{"id":"f1c9ef70-91a4-4797-b975-5445cd6ecb2a","block_type":"box","text":"II-7","page_number":339,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"4a4e25d5-8d68-4fa7-978a-b3cda3888685","block_type":"box","text":"NM1026U-6004382-339/605","page_number":339,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"2a4e1acb-7e69-4816-8acc-566c2273a21d","block_type":"box","text":"a Fund is authorized to enter into foreign currency hedging transactions in which it may seek to reduce","page_number":340,"box":{"x":116,"y":87,"width":766,"height":12}},{"id":"43b4ab78-c975-4512-b2e6-3cc7bf981299","block_type":"box","text":"the effect of exchange rate fluctuations.","page_number":340,"box":{"x":116,"y":102,"width":298,"height":13}},{"id":"f36d4750-e58c-4cd9-ae7a-39ebfcc2ed8a","block_type":"box","text":"Apart from currency considerations, the value of convertible securities is influenced by both the yield","page_number":340,"box":{"x":116,"y":130,"width":749,"height":12}},{"id":"05f9d50f-635e-4076-bc71-0a207ecd86f3","block_type":"box","text":"on nonconvertible securities of comparable issuers and by the value of the underlying common stock.","page_number":340,"box":{"x":116,"y":145,"width":757,"height":12}},{"id":"ea1f49d7-7c67-411f-8dc7-8528d37fbdad","block_type":"box","text":"The value of a convertible security viewed without regard to its conversion feature (","page_number":340,"box":{"x":116,"y":161,"width":617,"height":12}},{"id":"299ac009-f8bd-4197-976b-799fd9b8d95d","block_type":"box","text":"i.e.","page_number":340,"box":{"x":734,"y":161,"width":20,"height":9}},{"id":"4b4abc27-e1fd-4407-8d33-841a0684b425","block_type":"box","text":", strictly on the","page_number":340,"box":{"x":757,"y":161,"width":112,"height":12}},{"id":"83a5e364-374c-43f0-98fb-1c095090f795","block_type":"box","text":"basis of its yield) is sometimes referred to as its “investment value.” To the extent interest rates","page_number":340,"box":{"x":117,"y":176,"width":709,"height":12}},{"id":"9842578f-50bb-498a-b432-99160de71556","block_type":"box","text":"change, the investment value of the convertible security typically will fluctuate. At the same time,","page_number":340,"box":{"x":116,"y":192,"width":720,"height":12}},{"id":"e89d336d-6972-459d-b396-ebbd62fee615","block_type":"box","text":"however, the value of the convertible security will be influenced by its “conversion value,” which is the","page_number":340,"box":{"x":117,"y":207,"width":756,"height":12}},{"id":"faa32403-7c54-4480-9858-8b468961a042","block_type":"box","text":"market value of the underlying common stock that would be obtained if the convertible security were","page_number":340,"box":{"x":117,"y":223,"width":747,"height":12}},{"id":"5fcd7a83-a52f-4282-9533-0c5ad58498b4","block_type":"box","text":"converted. Conversion value fluctuates directly with the price of the underlying common stock. If the","page_number":340,"box":{"x":116,"y":238,"width":746,"height":12}},{"id":"e2b606d8-9f2e-4b55-b966-58ab0a70af3d","block_type":"box","text":"conversion value of a convertible security is substantially below its investment value, the price of the","page_number":340,"box":{"x":116,"y":254,"width":748,"height":12}},{"id":"29487b85-7d1f-491e-ac7b-06ede753fc09","block_type":"box","text":"convertible security is governed principally by its investment value. To the extent the conversion value","page_number":340,"box":{"x":116,"y":269,"width":761,"height":12}},{"id":"dcf9bad3-c5c5-4b59-b893-3ac0d94652b4","block_type":"box","text":"of a convertible security increases to a point that approximates or exceeds its investment value, the","page_number":340,"box":{"x":116,"y":285,"width":743,"height":12}},{"id":"3ab305aa-3aec-4f9f-ba6e-aab04e9e94c7","block_type":"box","text":"price of the convertible security will be influenced principally by its conversion value. A convertible","page_number":340,"box":{"x":117,"y":300,"width":729,"height":12}},{"id":"cd3a3aca-f35b-446a-83d0-6d2c21e2f9b9","block_type":"box","text":"security will sell at a premium over the conversion value to the extent investors place value on the right","page_number":340,"box":{"x":116,"y":316,"width":768,"height":12}},{"id":"c5a4b028-921b-49a2-a90d-2fcaa70fa327","block_type":"box","text":"to acquire the underlying common stock while holding a fixed-income security. The yield and","page_number":340,"box":{"x":116,"y":331,"width":691,"height":12}},{"id":"8c2e67d7-420b-42da-98dc-7496b0a0958f","block_type":"box","text":"conversion premium of convertible securities issued in Japan and the Euromarket are frequently","page_number":340,"box":{"x":116,"y":347,"width":718,"height":12}},{"id":"4184f74e-8557-47e2-ad1b-d4b00fc150e8","block_type":"box","text":"determined at levels that cause the conversion value to affect their market value more than the","page_number":340,"box":{"x":116,"y":362,"width":708,"height":10}},{"id":"d76571b4-e2a2-4816-9fc6-b158c3d0275b","block_type":"box","text":"securities’ investment value.","page_number":340,"box":{"x":116,"y":378,"width":215,"height":9}},{"id":"105e8617-93e7-41d5-bab7-46fc0d8d0d17","block_type":"box","text":"Holders of convertible securities generally have a claim on the assets of the issuer prior to the common","page_number":340,"box":{"x":117,"y":405,"width":770,"height":12}},{"id":"cefaf540-3f29-4365-a892-39d75df588b4","block_type":"box","text":"stockholders but may be subordinated to other debt securities of the same issuer. A convertible","page_number":340,"box":{"x":116,"y":420,"width":713,"height":12}},{"id":"629a4761-870f-4cb3-8442-07d0d35701f2","block_type":"box","text":"security may be subject to redemption at the option of the issuer at a price established in a charter","page_number":340,"box":{"x":116,"y":436,"width":734,"height":12}},{"id":"64ba9c6b-72f4-4e55-9138-31188af9c85d","block_type":"box","text":"provision, indenture or other governing instrument pursuant to which the convertible security was","page_number":340,"box":{"x":117,"y":451,"width":723,"height":12}},{"id":"55f4cef6-f92b-4b01-abae-3a37cc8a3a3b","block_type":"box","text":"issued. If a convertible security held by a Fund is called for redemption, the Fund will be required to","page_number":340,"box":{"x":117,"y":467,"width":741,"height":12}},{"id":"6b98829d-e707-47ef-8ff0-ac9dd64e81d7","block_type":"box","text":"redeem the security, convert it into the underlying common stock or sell it to a third party. Certain","page_number":340,"box":{"x":117,"y":482,"width":723,"height":12}},{"id":"fd7e2f52-94b1-4307-b687-cede198b24b1","block_type":"box","text":"convertible debt securities may provide a put option to the holder, which entitles the holder to cause","page_number":340,"box":{"x":116,"y":498,"width":745,"height":12}},{"id":"80e217a3-b3b4-4d3d-980a-b3516bfe71e0","block_type":"box","text":"the security to be redeemed by the issuer at a premium over the stated principal amount of the debt","page_number":340,"box":{"x":116,"y":513,"width":745,"height":12}},{"id":"f3d06d90-2384-4cbc-83e5-ed358236b81d","block_type":"box","text":"security under certain circumstances.","page_number":340,"box":{"x":116,"y":529,"width":282,"height":12}},{"id":"eaa5f5a4-2926-4b32-b59e-bd6af3906fd2","block_type":"box","text":"A Fund may also invest in synthetic convertible securities. Synthetic convertible securities may include","page_number":340,"box":{"x":116,"y":556,"width":765,"height":12}},{"id":"aaafbf64-6673-448f-9275-1c44d7ecf0b1","block_type":"box","text":"either Cash-Settled Convertibles or Manufactured Convertibles. “Cash-Settled Convertibles” are","page_number":340,"box":{"x":116,"y":571,"width":717,"height":10}},{"id":"78a9e861-1ae3-4a03-826f-ee988e1362f4","block_type":"box","text":"instruments that are created by the issuer and have the economic characteristics of traditional","page_number":340,"box":{"x":117,"y":587,"width":701,"height":12}},{"id":"7fde995d-b3ca-46ec-9aa9-d4d2200421ef","block_type":"box","text":"convertible securities but may not actually permit conversion into the underlying equity securities in all","page_number":340,"box":{"x":116,"y":603,"width":760,"height":12}},{"id":"e5b6c04d-acfc-4cea-a006-0392b5d00fd8","block_type":"box","text":"circumstances. As an example, a private company may issue a Cash-Settled Convertible that is","page_number":340,"box":{"x":116,"y":618,"width":715,"height":12}},{"id":"c66cd798-1c0e-442d-9333-ace7e0bab210","block_type":"box","text":"convertible into common stock only if the company successfully completes a public offering of its","page_number":340,"box":{"x":116,"y":634,"width":721,"height":12}},{"id":"e2afbd20-bd0d-4d08-828e-c523b0c883fa","block_type":"box","text":"common stock prior to maturity and otherwise pays a cash amount to reflect any equity appreciation.","page_number":340,"box":{"x":116,"y":649,"width":751,"height":12}},{"id":"c6c441e9-035a-461a-8042-8de155c2fe04","block_type":"box","text":"“Manufactured Convertibles” are created by the Manager or another party by combining separate","page_number":340,"box":{"x":116,"y":665,"width":721,"height":12}},{"id":"d29556f8-7aa5-4ddb-b05f-089558d4632b","block_type":"box","text":"securities that possess one of the two principal characteristics of a convertible security,","page_number":340,"box":{"x":116,"y":680,"width":645,"height":12}},{"id":"a0bdd728-0fe2-4829-9ed5-e3e5ee5b0187","block_type":"box","text":"i.e.","page_number":340,"box":{"x":767,"y":680,"width":21,"height":10}},{"id":"6a18181b-69cd-495a-b57f-6eb58fb256bf","block_type":"box","text":", fixed","page_number":340,"box":{"x":791,"y":680,"width":49,"height":11}},{"id":"a72bca00-34ca-4593-b56c-0626b8ec3c47","block_type":"box","text":"income (“fixed-income component”) or a right to acquire equity securities (“convertibility component”).","page_number":340,"box":{"x":117,"y":696,"width":750,"height":12}},{"id":"60ec183a-2efd-4fae-9e2c-07bba1e96751","block_type":"box","text":"The fixed-income component is achieved by investing in nonconvertible fixed-income securities, such","page_number":340,"box":{"x":116,"y":711,"width":751,"height":12}},{"id":"b473151d-8bbd-42d3-a34a-abbcf1e6e965","block_type":"box","text":"as nonconvertible bonds, preferred stocks and money market instruments. The convertibility","page_number":340,"box":{"x":116,"y":727,"width":684,"height":12}},{"id":"b29d3026-e8d9-4609-b525-19b9157f5811","block_type":"box","text":"component is achieved by investing in call options, warrants, or other securities with equity conversion","page_number":340,"box":{"x":116,"y":742,"width":758,"height":12}},{"id":"454a1354-7478-4551-a536-8adf9f513db2","block_type":"box","text":"features (“equity features”) granting the holder the right to purchase a specified quantity of the","page_number":340,"box":{"x":116,"y":758,"width":697,"height":12}},{"id":"601c0fcd-d51b-45f0-a074-726d5ae8bf6e","block_type":"box","text":"underlying stocks within a specified period of time at a specified price or, in the case of a stock index","page_number":340,"box":{"x":117,"y":773,"width":745,"height":12}},{"id":"4f5ba60d-82ec-4d5f-8e55-e67d9bee045a","block_type":"box","text":"option, the right to receive a cash payment based on the value of the underlying stock index.","page_number":340,"box":{"x":116,"y":789,"width":685,"height":12}},{"id":"c5e3d9b2-984d-471e-a1f2-a2c986450078","block_type":"box","text":"A Manufactured Convertible differs from traditional convertible securities in several respects. Unlike a","page_number":340,"box":{"x":116,"y":816,"width":751,"height":12}},{"id":"a1c38dde-6860-4c8b-955b-f2e60a2c2af7","block_type":"box","text":"traditional convertible security, which is a single security that has a unitary market value, a","page_number":340,"box":{"x":116,"y":831,"width":674,"height":12}},{"id":"2055c1e1-60c4-4f23-8fba-f049264ae392","block_type":"box","text":"Manufactured Convertible is comprised of two or more separate securities, each with its own market","page_number":340,"box":{"x":117,"y":847,"width":747,"height":12}},{"id":"50c4da35-9d5d-47e1-b61d-1e5c08a8c399","block_type":"box","text":"value. Therefore, the total “market value” of such a Manufactured Convertible is the sum of the values","page_number":340,"box":{"x":116,"y":862,"width":761,"height":11}},{"id":"a7395c2f-bc13-4ac3-9c2e-bc08cd987bc5","block_type":"box","text":"of its fixed-income component and its convertibility component.","page_number":340,"box":{"x":116,"y":878,"width":472,"height":12}},{"id":"39e8cb99-a624-456e-9821-1b8f628bd450","block_type":"box","text":"II-8","page_number":340,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"c1471087-dfe1-4720-90f0-802a12735346","block_type":"box","text":"NM1026U-6004382-340/605","page_number":340,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"8f7c9049-c357-4133-ad03-f602fa3de6e4","block_type":"box","text":"More flexibility is possible in the creation of a Manufactured Convertible than in the purchase of a","page_number":341,"box":{"x":117,"y":87,"width":724,"height":12}},{"id":"0cd9549b-3bc6-4245-ab8e-d08bd5dd1730","block_type":"box","text":"traditional convertible security. Because many corporations have not issued convertible securities, the","page_number":341,"box":{"x":116,"y":103,"width":761,"height":12}},{"id":"a3e5aec7-fc93-4e73-aa60-cd28be797b96","block_type":"box","text":"Manager may combine a fixed-income instrument and an equity feature with respect to the stock of the","page_number":341,"box":{"x":117,"y":118,"width":767,"height":12}},{"id":"bb3ad7ab-a3ab-46c9-a627-767d0440f272","block_type":"box","text":"issuer of the fixed-income instrument to create a synthetic convertible security otherwise unavailable in","page_number":341,"box":{"x":117,"y":134,"width":767,"height":12}},{"id":"9983d8f0-dd9b-4e16-90d8-3446313fc468","block_type":"box","text":"the market. The Manager may also combine a fixed-income instrument of an issuer with an equity","page_number":341,"box":{"x":116,"y":149,"width":731,"height":12}},{"id":"e688697b-f21a-435a-87b2-bac97a9fae8a","block_type":"box","text":"feature with respect to the stock of a different issuer when the Manager believes such a Manufactured","page_number":341,"box":{"x":116,"y":165,"width":763,"height":12}},{"id":"38831596-2778-4cfe-b12e-dbb20fc545ec","block_type":"box","text":"Convertible would better promote a Fund’s objective than alternative investments. For example, the","page_number":341,"box":{"x":117,"y":180,"width":742,"height":12}},{"id":"2abaf895-7639-46c1-9881-dae32c27a9b7","block_type":"box","text":"Manager may combine an equity feature with respect to an issuer’s stock with a fixed-income security","page_number":341,"box":{"x":117,"y":196,"width":759,"height":12}},{"id":"b4d59baf-e9c8-43e0-bb55-fd9a24e04809","block_type":"box","text":"of a different issuer in the same industry to diversify the Fund’s credit exposure, or with a U.S.","page_number":341,"box":{"x":116,"y":211,"width":702,"height":12}},{"id":"586790bb-9009-42e5-bcaa-b03eaa96542e","block_type":"box","text":"Treasury instrument to create a Manufactured Convertible with a higher credit profile than a traditional","page_number":341,"box":{"x":116,"y":227,"width":762,"height":12}},{"id":"5e818b38-8b9a-4ce2-8323-a71f51c03788","block_type":"box","text":"convertible security issued by that issuer. A Manufactured Convertible also is a more flexible","page_number":341,"box":{"x":116,"y":242,"width":691,"height":12}},{"id":"2aa07655-af22-4487-8664-52ad47b9de69","block_type":"box","text":"investment in that its two components may be purchased separately and, upon purchasing the","page_number":341,"box":{"x":117,"y":258,"width":704,"height":12}},{"id":"b3622234-0192-4899-a585-8eed3312dec6","block_type":"box","text":"separate securities, “combined” to create a Manufactured Convertible. For example, the Fund may","page_number":341,"box":{"x":116,"y":273,"width":736,"height":12}},{"id":"c94b7cd8-85a0-46d7-9fe3-ba2c4511eb6d","block_type":"box","text":"purchase a warrant for eventual inclusion in a Manufactured Convertible while postponing the","page_number":341,"box":{"x":117,"y":289,"width":697,"height":12}},{"id":"d4b3eb0d-6ec7-4035-8014-f26e34cce273","block_type":"box","text":"purchase of a suitable bond to pair with the warrant pending development of more favorable market","page_number":341,"box":{"x":117,"y":304,"width":743,"height":12}},{"id":"8e659461-b5fe-4790-bd74-b6d4efe4b823","block_type":"box","text":"conditions.","page_number":341,"box":{"x":116,"y":320,"width":85,"height":9}},{"id":"f58a0b5e-532e-4f12-a796-341295d8cbec","block_type":"box","text":"The value of a Manufactured Convertible may respond to certain market fluctuations differently from a","page_number":341,"box":{"x":116,"y":351,"width":761,"height":12}},{"id":"c0486225-c84a-4f43-8e56-97477f918fb6","block_type":"box","text":"traditional convertible security with similar characteristics. For example, in the event a Fund created a","page_number":341,"box":{"x":116,"y":366,"width":758,"height":12}},{"id":"a2c373fa-dda4-4183-9a64-70da997581a4","block_type":"box","text":"Manufactured Convertible by combining a short-term U.S. Treasury instrument and a call option on a","page_number":341,"box":{"x":117,"y":382,"width":752,"height":12}},{"id":"fab493fd-2e50-454e-9543-84e463e2694f","block_type":"box","text":"stock, the Manufactured Convertible would be expected to outperform a traditional convertible of","page_number":341,"box":{"x":116,"y":397,"width":720,"height":12}},{"id":"adb3f39b-d99a-4a75-8faf-45ca57d14216","block_type":"box","text":"similar maturity that is convertible into that stock during periods when Treasury instruments outperform","page_number":341,"box":{"x":116,"y":413,"width":767,"height":12}},{"id":"31ff651a-3caa-4ede-9306-a1771b17bebd","block_type":"box","text":"corporate fixed-income securities and underperform during periods when corporate fixed-income","page_number":341,"box":{"x":116,"y":428,"width":722,"height":12}},{"id":"e1e6ba64-1543-4c45-8bd8-6a5c3a09e5b1","block_type":"box","text":"securities outperform Treasury instruments.","page_number":341,"box":{"x":116,"y":444,"width":329,"height":12}},{"id":"89092203-303b-4d7f-bb1d-7d1a41d16332","block_type":"box","text":"Corporate Loans.","page_number":341,"box":{"x":117,"y":475,"width":137,"height":12}},{"id":"9d0e294d-06e6-425c-bbeb-db943ac90863","block_type":"box","text":"Certain Funds may invest in corporate loans. Corporate loans are generally","page_number":341,"box":{"x":255,"y":475,"width":570,"height":12}},{"id":"b0005eea-43c4-4949-8d85-17507a4ca7de","block_type":"box","text":"non-investment grade floating rate instruments. Usually, they are freely callable at the issuer’s option.","page_number":341,"box":{"x":117,"y":490,"width":757,"height":12}},{"id":"1567adf4-a28f-48f3-85a3-861a83dd0ed3","block_type":"box","text":"Certain Funds may invest in fixed and floating rate loans (“Loans”) arranged through private","page_number":341,"box":{"x":117,"y":506,"width":685,"height":12}},{"id":"43583e6f-028e-4272-b35a-a94eeacdb647","block_type":"box","text":"negotiations between a corporate borrower or a foreign sovereign entity and one or more financial","page_number":341,"box":{"x":117,"y":521,"width":730,"height":12}},{"id":"a15644c7-fa90-4729-8168-14c35037d93d","block_type":"box","text":"institutions or institutional investors (“Lenders”). A Fund may invest in such Loans in the form of","page_number":341,"box":{"x":117,"y":537,"width":712,"height":12}},{"id":"84e497dc-7828-4fb8-9bf2-9e7f592fcb4a","block_type":"box","text":"participations in Loans (“Participations”) and assignments of all or a portion of Loans from third parties","page_number":341,"box":{"x":117,"y":552,"width":761,"height":12}},{"id":"fab6c133-8297-43ac-9732-54312a415679","block_type":"box","text":"(“Assignments”). A Fund considers these investments to be investments in debt securities for purposes","page_number":341,"box":{"x":117,"y":568,"width":769,"height":12}},{"id":"bdedbba4-7974-48f6-9079-8eba2384eb39","block_type":"box","text":"of its investment policies. Participations typically will result in the Fund having a contractual relationship","page_number":341,"box":{"x":116,"y":583,"width":770,"height":12}},{"id":"9fc22052-e1a1-4843-8dec-5eb643740415","block_type":"box","text":"only with the Lender, not with the borrower. The Fund will have the right to receive payments of","page_number":341,"box":{"x":116,"y":599,"width":712,"height":12}},{"id":"d8830eb0-14cf-47f8-9ce2-cd0a93059fc7","block_type":"box","text":"principal, interest and any fees to which it is entitled only from the Lender selling the Participation and","page_number":341,"box":{"x":117,"y":614,"width":756,"height":12}},{"id":"0325ee7a-a151-45e3-9cda-dc733e69727d","block_type":"box","text":"only upon receipt by the Lender of the payments from the borrower. In connection with purchasing","page_number":341,"box":{"x":116,"y":630,"width":734,"height":12}},{"id":"56286b35-547b-4a52-a1d0-500f3f016f16","block_type":"box","text":"Participations, the Fund generally will have no right to enforce compliance by the borrower with the","page_number":341,"box":{"x":117,"y":645,"width":737,"height":12}},{"id":"1baee11a-ab5b-49d7-850c-24ce169fab65","block_type":"box","text":"terms of the loan agreement relating to the Loans, nor any rights of set-off against the borrower, and","page_number":341,"box":{"x":116,"y":661,"width":744,"height":12}},{"id":"a21502ca-d1b5-436d-8ee2-2ec4d15548e1","block_type":"box","text":"the Fund may not benefit directly from any collateral supporting the Loan in which it has purchased the","page_number":341,"box":{"x":116,"y":676,"width":761,"height":12}},{"id":"59666c91-b90c-4027-9294-d160ef713bb0","block_type":"box","text":"Participation. As a result, the Fund will assume the credit risk of both the borrower and the Lender that","page_number":341,"box":{"x":117,"y":692,"width":758,"height":12}},{"id":"fd26c0b3-b13d-4865-9a5d-900f4855affa","block_type":"box","text":"is selling the Participation. In the event of the insolvency of the Lender selling the Participation, the","page_number":341,"box":{"x":117,"y":707,"width":730,"height":12}},{"id":"1edf85f4-1547-4650-9e29-3886e6fc2b12","block_type":"box","text":"Fund may be treated as a general creditor of the Lender and may not benefit from any set-off between","page_number":341,"box":{"x":117,"y":723,"width":758,"height":12}},{"id":"b4da9711-40d5-4fb8-b15d-1debd0d4d130","block_type":"box","text":"the Lender and the borrower. The Fund will acquire Participations only if the Lender interpositioned","page_number":341,"box":{"x":116,"y":738,"width":734,"height":12}},{"id":"f51c557c-d59e-4efc-a947-71ca81aab279","block_type":"box","text":"between the Fund and the borrower is determined by the Fund’s manager to be creditworthy. When","page_number":341,"box":{"x":117,"y":754,"width":738,"height":12}},{"id":"dc0bb54f-0b9a-48d1-b564-7f21a95423ca","block_type":"box","text":"the Fund purchases Assignments from Lenders, the Fund will acquire direct rights against the borrower","page_number":341,"box":{"x":116,"y":769,"width":767,"height":12}},{"id":"8fc468ea-8b49-4200-971f-72e71023765d","block_type":"box","text":"on the Loan, and will not have exposure to a counterparty’s credit risk. The Funds may enter into","page_number":341,"box":{"x":116,"y":785,"width":718,"height":12}},{"id":"057b46a2-1a51-4454-beb7-258a439a08d7","block_type":"box","text":"Participations and Assignments on a forward commitment or “when-issued” basis, whereby a Fund","page_number":341,"box":{"x":117,"y":800,"width":731,"height":12}},{"id":"b8832cb0-53f5-4f47-8b11-58f48dbe5eb5","block_type":"box","text":"would agree to purchase a Participation or Assignment at set terms in the future. For more information","page_number":341,"box":{"x":116,"y":816,"width":759,"height":12}},{"id":"c0dc516d-b3ab-4ab5-b064-cd82a161cbd5","block_type":"box","text":"on forward commitments and when-issued securities, see “When-Issued Securities, Delayed Delivery","page_number":341,"box":{"x":116,"y":831,"width":757,"height":12}},{"id":"24cf6e61-a00d-4992-8d44-50e8e8103626","block_type":"box","text":"Securities and Forward Commitments” below.","page_number":341,"box":{"x":116,"y":847,"width":345,"height":9}},{"id":"425eb605-b15c-4714-8416-e79efd15a954","block_type":"box","text":"II-9","page_number":341,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"8f736ac1-ef84-41f2-a48b-cb08e7e194fa","block_type":"box","text":"NM1026U-6004382-341/605","page_number":341,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"d5fe5954-8c99-437c-b706-cde81de627dd","block_type":"box","text":"A Fund may have difficulty disposing of Assignments and Participations. In certain cases, the market","page_number":342,"box":{"x":116,"y":87,"width":752,"height":12}},{"id":"ed76af80-7370-4c65-b112-fcd27be49c5c","block_type":"box","text":"for such instruments may lack sufficient liquidity, and therefore the Fund anticipates that in such cases","page_number":342,"box":{"x":116,"y":102,"width":764,"height":13}},{"id":"6c3f5f7a-edda-4e9b-9174-14de229f0953","block_type":"box","text":"such instruments could be sold only to a limited number of institutional investors. The lack of a","page_number":342,"box":{"x":116,"y":118,"width":704,"height":12}},{"id":"5a883545-c8c7-427a-8a55-61285152b2ed","block_type":"box","text":"sufficiently liquid secondary market may have an adverse impact on the value of such instruments and","page_number":342,"box":{"x":116,"y":134,"width":765,"height":12}},{"id":"41f90c07-9a95-4e6d-b9fb-dffa947912f0","block_type":"box","text":"on the Fund’s ability to dispose of particular Assignments or Participations in response to a specific","page_number":342,"box":{"x":116,"y":149,"width":740,"height":12}},{"id":"2d3e889e-9940-4888-8f69-14d8c575054d","block_type":"box","text":"economic event, such as deterioration in the creditworthiness of the borrower.","page_number":342,"box":{"x":116,"y":165,"width":583,"height":11}},{"id":"1ce6dad3-9927-4dda-96b4-d103dc30623a","block_type":"box","text":"Leading financial institutions often act as agent for a broader group of Lenders, generally referred to as","page_number":342,"box":{"x":117,"y":193,"width":768,"height":12}},{"id":"70241d5d-d5f9-4164-b146-2ed937055ed7","block_type":"box","text":"a syndicate. The syndicate’s agent arranges the loans, holds collateral and accepts payments of","page_number":342,"box":{"x":116,"y":209,"width":720,"height":12}},{"id":"f90a0748-6b28-4d82-8d3e-7467e2c3c92b","block_type":"box","text":"principal and interest. Failure by the syndicate agent to fulfill its obligations may delay or adversely","page_number":342,"box":{"x":117,"y":224,"width":734,"height":12}},{"id":"5cbd4441-570b-4b77-b9b9-6e5350363635","block_type":"box","text":"affect receipt of payment by the Fund.","page_number":342,"box":{"x":116,"y":240,"width":287,"height":12}},{"id":"cd62971c-7f7a-490b-af42-b64ad0cdbe02","block_type":"box","text":"The Loans in which the Fund may invest are subject to the risk of loss of principal and income.","page_number":342,"box":{"x":116,"y":269,"width":706,"height":12}},{"id":"3e9ba735-b3e0-4d4d-b9c1-006ba53d4ec5","block_type":"box","text":"Although borrowers frequently provide collateral to secure repayment of these obligations they do not","page_number":342,"box":{"x":116,"y":284,"width":757,"height":12}},{"id":"12e484ba-84fc-48b9-acac-8ce3f5e211a9","block_type":"box","text":"always do so. If they do provide collateral, the value of the collateral may not completely cover the","page_number":342,"box":{"x":116,"y":300,"width":732,"height":12}},{"id":"fb2738bd-1a1a-4d32-a9d7-b4cb3bbe0d40","block_type":"box","text":"borrower’s obligations at the time of a default. If a borrower files for protection from its creditors under","page_number":342,"box":{"x":117,"y":315,"width":757,"height":12}},{"id":"7157eddb-a291-4fd5-91ec-edc3b60af248","block_type":"box","text":"the U.S. bankruptcy laws, these laws may limit a Fund’s rights to its collateral. In addition, the value of","page_number":342,"box":{"x":116,"y":331,"width":761,"height":12}},{"id":"8d841008-f0fb-472a-8241-5af997138c54","block_type":"box","text":"collateral may erode during a bankruptcy case. In the event of a bankruptcy, the holder of a Loan may","page_number":342,"box":{"x":116,"y":346,"width":762,"height":12}},{"id":"fbcfd68b-561f-4f23-bf1a-adbad8000158","block_type":"box","text":"not recover its principal, may experience a long delay in recovering its investment and may not receive","page_number":342,"box":{"x":117,"y":362,"width":765,"height":12}},{"id":"fbb3c86a-ae6e-4f58-953f-681eb06770da","block_type":"box","text":"interest during the delay.","page_number":342,"box":{"x":117,"y":377,"width":188,"height":12}},{"id":"da0580e4-73a2-477e-a0a6-7199937a9e54","block_type":"box","text":"Transactions in corporate loans may settle on a delayed basis. As a result, the proceeds from the sale","page_number":342,"box":{"x":116,"y":406,"width":763,"height":12}},{"id":"0cc7cdd1-7d79-43a5-ae7d-299319e006e9","block_type":"box","text":"of corporate loans may not be readily available to make additional investments or to meet a Fund’s","page_number":342,"box":{"x":116,"y":421,"width":738,"height":12}},{"id":"50494350-74a3-412c-a1db-43d7f056f02e","block_type":"box","text":"redemption obligations. To the extent the extended settlement process gives rise to short-term liquidity","page_number":342,"box":{"x":117,"y":437,"width":765,"height":12}},{"id":"e75c4b2f-e8eb-46da-a236-c088ba455b35","block_type":"box","text":"needs, a Fund may hold additional cash, sell investments or temporarily borrow from banks and other","page_number":342,"box":{"x":117,"y":452,"width":758,"height":12}},{"id":"2737fc8b-9317-4976-ad51-dd9d8ab95a2d","block_type":"box","text":"lenders.","page_number":342,"box":{"x":117,"y":468,"width":63,"height":9}},{"id":"0af54801-8652-4957-8403-008235c39bec","block_type":"box","text":"In certain circumstances, Loans may not be deemed to be securities under certain federal securities","page_number":342,"box":{"x":117,"y":497,"width":746,"height":12}},{"id":"0e469c5b-4d89-4c2a-8f07-bef93ca51fec","block_type":"box","text":"laws. Therefore, in the event of fraud or misrepresentation by a borrower or an arranger, Lenders and","page_number":342,"box":{"x":117,"y":512,"width":758,"height":12}},{"id":"03b7e663-186f-4823-9612-40f793f3cb05","block_type":"box","text":"purchasers of interests in Loans, such as the Funds, may not have the protection of the anti-fraud","page_number":342,"box":{"x":117,"y":528,"width":729,"height":12}},{"id":"c9576b21-1a71-44f4-af25-ec942e440ebf","block_type":"box","text":"provisions of the federal securities laws as would otherwise be available for bonds or stocks. Instead,","page_number":342,"box":{"x":117,"y":543,"width":755,"height":12}},{"id":"0a74857c-3ee7-48af-bafe-83c3c2432647","block_type":"box","text":"in such cases, parties generally would rely on the contractual provisions in the Loan agreement itself","page_number":342,"box":{"x":117,"y":559,"width":750,"height":12}},{"id":"4a5ada7a-f57a-4a1e-9076-a43c0f43804f","block_type":"box","text":"and common-law fraud protections under applicable state law.","page_number":342,"box":{"x":116,"y":574,"width":467,"height":12}},{"id":"ea858b0a-d797-4b3a-9065-0dd003cd5269","block_type":"box","text":"Direct Lending.","page_number":342,"box":{"x":116,"y":603,"width":111,"height":12}},{"id":"aee51a13-fb2f-4136-a013-bd4d0c31ac4d","block_type":"box","text":"The Fund may act as the originator for direct loans and engage in direct lending. Direct","page_number":342,"box":{"x":229,"y":603,"width":655,"height":12}},{"id":"26285a20-2daf-4db8-bb1d-4d4ca3a14acb","block_type":"box","text":"loans between the Fund and a borrower may not be administered by an underwriter or agent bank. The","page_number":342,"box":{"x":117,"y":618,"width":771,"height":12}},{"id":"21294ab7-c48a-427a-9ae3-c06b6ef759f1","block_type":"box","text":"Fund may provide financing to commercial borrowers directly or through companies acquired (or","page_number":342,"box":{"x":117,"y":634,"width":719,"height":12}},{"id":"490d616b-0f86-4d0a-9cd2-b06f40c4c7e0","block_type":"box","text":"created) and owned by or otherwise affiliated with the Fund. The terms of the direct loans are","page_number":342,"box":{"x":116,"y":649,"width":697,"height":12}},{"id":"9b3164af-6064-4899-87e2-37486565ec2d","block_type":"box","text":"negotiated with borrowers in private transactions. Furthermore, a direct loan may be secured or","page_number":342,"box":{"x":117,"y":665,"width":707,"height":12}},{"id":"455ccea7-5a81-442f-9b39-430b0622af68","block_type":"box","text":"unsecured.","page_number":342,"box":{"x":117,"y":680,"width":80,"height":10}},{"id":"98d1d386-ba1d-4ac5-a771-79c16bb5cec6","block_type":"box","text":"In determining whether to make a direct loan, the Fund will rely primarily upon the creditworthiness of","page_number":342,"box":{"x":117,"y":709,"width":751,"height":12}},{"id":"099b807a-2ade-43c5-b57f-9204437894f2","block_type":"box","text":"the borrower and/or any collateral for payment of interest and repayment of principal. The risks","page_number":342,"box":{"x":116,"y":725,"width":703,"height":12}},{"id":"cccd0c2a-742b-41e7-973a-6a1ab9cda40b","block_type":"box","text":"associated with direct loans are substantially similar to those associated with investing in corporate","page_number":342,"box":{"x":116,"y":740,"width":733,"height":12}},{"id":"60c1ed14-1bc6-4ed5-96de-90e47ed6ab5b","block_type":"box","text":"loans. In making a direct loan, the Fund is exposed to the risk that the borrower may default or become","page_number":342,"box":{"x":117,"y":756,"width":764,"height":12}},{"id":"93e57ba0-f117-423f-8f4e-d8526acab94d","block_type":"box","text":"insolvent and, consequently, that the Fund will lose money on the loan. Furthermore, direct loans may","page_number":342,"box":{"x":117,"y":771,"width":755,"height":12}},{"id":"95e96965-3e31-4b25-90af-8590c3a22515","block_type":"box","text":"subject the Fund to liquidity and interest rate risk and certain direct loans may be deemed illiquid.","page_number":342,"box":{"x":116,"y":787,"width":720,"height":12}},{"id":"311a0a79-26b6-412a-8199-4d30539563fb","block_type":"box","text":"Direct loans are not publicly traded and may not have a secondary market. The lack of a secondary","page_number":342,"box":{"x":117,"y":802,"width":737,"height":12}},{"id":"3090550a-7dcd-419e-a352-198dae43b269","block_type":"box","text":"market for direct loans may have an adverse impact on the ability of the Fund to dispose of a direct","page_number":342,"box":{"x":117,"y":818,"width":734,"height":12}},{"id":"d933dbfd-1298-46b9-a10f-e3145884b08c","block_type":"box","text":"loan and/or to value the direct loan.","page_number":342,"box":{"x":117,"y":833,"width":266,"height":10}},{"id":"a5fb34f7-e235-4fdb-a9d5-8e37e5e6a98d","block_type":"box","text":"When engaging in direct lending, the Fund’s performance may depend, in part, on the ability of the","page_number":342,"box":{"x":116,"y":862,"width":736,"height":12}},{"id":"c9fdce60-1fb2-4ae7-93d2-c7515f3c60af","block_type":"box","text":"Fund to originate loans on advantageous terms. In originating loans, the Fund will compete with a","page_number":342,"box":{"x":117,"y":878,"width":727,"height":11}},{"id":"b15cdfc6-3b52-437e-af01-5f1783978997","block_type":"box","text":"II-10","page_number":342,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"e2785934-7864-4680-b158-c06172465c5a","block_type":"box","text":"NM1026U-6004382-342/605","page_number":342,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"54734ed7-1493-4d85-88ec-82617a65f4b7","block_type":"box","text":"broad spectrum of lenders. Increased competition for, or a diminishment in the available supply of,","page_number":343,"box":{"x":117,"y":87,"width":733,"height":12}},{"id":"91672116-9a8d-4bd7-943f-12ef7a6e3755","block_type":"box","text":"qualifying loans could result in lower yields on such loans, which could reduce Fund performance.","page_number":343,"box":{"x":116,"y":102,"width":730,"height":13}},{"id":"fc310044-091d-4ea8-aa4f-943a4eddfe62","block_type":"box","text":"As part of its lending activities, the Fund may originate loans to companies that are experiencing","page_number":343,"box":{"x":116,"y":134,"width":719,"height":12}},{"id":"41d84d02-f8cd-49ac-a57c-91264982f97b","block_type":"box","text":"significant financial or business difficulties, including companies involved in bankruptcy or other","page_number":343,"box":{"x":116,"y":149,"width":710,"height":12}},{"id":"d6140944-dbde-424a-aaff-16dda6594a65","block_type":"box","text":"reorganization and liquidation proceedings. Although the terms of such financing may result in","page_number":343,"box":{"x":117,"y":165,"width":701,"height":12}},{"id":"939190e2-f178-4f88-bea4-5f3778700ae3","block_type":"box","text":"significant financial returns to the Fund, they involve a substantial degree of risk. The level of analytical","page_number":343,"box":{"x":116,"y":180,"width":768,"height":12}},{"id":"6253bce7-23a5-4ba0-8043-2e64f87ab59a","block_type":"box","text":"sophistication, both financial and legal, necessary for successful financing to companies experiencing","page_number":343,"box":{"x":116,"y":196,"width":758,"height":12}},{"id":"cb85ee30-857d-4368-bce9-223f13d310c8","block_type":"box","text":"significant business and financial difficulties is unusually high.","page_number":343,"box":{"x":116,"y":211,"width":461,"height":12}},{"id":"b81ba60d-061a-4d11-a11f-e48f2e5aa982","block_type":"box","text":"Credit Linked Securities.","page_number":343,"box":{"x":117,"y":242,"width":195,"height":10}},{"id":"873cfb7e-7857-43d4-ace3-959a09c4a1b7","block_type":"box","text":"Among the income producing securities in which a Fund may invest are","page_number":343,"box":{"x":313,"y":242,"width":541,"height":12}},{"id":"5cb162aa-2cd1-41bf-81fb-331ccb521f9d","block_type":"box","text":"credit linked securities, which are issued by a limited purpose trust or other vehicle that, in turn, invests","page_number":343,"box":{"x":116,"y":258,"width":768,"height":12}},{"id":"19e29115-e2d6-4486-9464-317d72dedda9","block_type":"box","text":"in a derivative instrument or basket of derivative instruments, such as credit default swaps, interest rate","page_number":343,"box":{"x":117,"y":273,"width":771,"height":12}},{"id":"50519efe-5178-4bed-9e92-7397c9d68926","block_type":"box","text":"swaps and other securities, in order to provide exposure to certain fixed-income markets. For instance,","page_number":343,"box":{"x":116,"y":289,"width":768,"height":12}},{"id":"4d3369b4-8ac9-481f-b548-6060aadbc9be","block_type":"box","text":"a Fund may invest in credit linked securities as a cash management tool in order to gain exposure to a","page_number":343,"box":{"x":116,"y":304,"width":765,"height":12}},{"id":"9a2437eb-f7a0-425e-a51a-e5e09728ef27","block_type":"box","text":"certain market and/or to remain fully invested when more traditional income producing securities are","page_number":343,"box":{"x":116,"y":320,"width":748,"height":12}},{"id":"d67ef300-0067-4965-b49d-a478b873952e","block_type":"box","text":"not available.","page_number":343,"box":{"x":117,"y":335,"width":103,"height":10}},{"id":"c2a8c0a1-1724-4dba-8746-579840058104","block_type":"box","text":"Like an investment in a bond, investments in these credit linked securities represent the right to receive","page_number":343,"box":{"x":117,"y":366,"width":770,"height":12}},{"id":"b5101022-0abf-4de5-8239-f8f4d88c1bcd","block_type":"box","text":"periodic income payments (in the form of distributions) and payment of principal at the end of the term","page_number":343,"box":{"x":117,"y":382,"width":761,"height":12}},{"id":"74c4c1a6-6921-49c5-a4cf-7c53b74f0797","block_type":"box","text":"of the security.","page_number":343,"box":{"x":116,"y":397,"width":114,"height":12}},{"id":"efa242a6-7d3c-4aa7-82d4-28741f207695","block_type":"box","text":"However, these payments are conditioned on the issuer’s receipt of payments from, and the issuer’s","page_number":343,"box":{"x":117,"y":428,"width":748,"height":12}},{"id":"5878d327-bf0e-4176-954c-ccb232c767de","block_type":"box","text":"potential obligations to, the counterparties to the derivative instruments and other securities in which","page_number":343,"box":{"x":117,"y":444,"width":747,"height":12}},{"id":"572c4281-c1fe-4ad4-a930-ef6d90bcc52f","block_type":"box","text":"the issuer invests. For instance, the issuer may sell one or more credit default swaps, under which the","page_number":343,"box":{"x":116,"y":459,"width":762,"height":12}},{"id":"0118b160-f54d-43b2-a13f-9060f94f812a","block_type":"box","text":"issuer would receive a stream of payments over the term of the swap agreements provided that no","page_number":343,"box":{"x":117,"y":475,"width":736,"height":12}},{"id":"ecb8aba9-4cb9-4d85-b13a-85c4f99728ff","block_type":"box","text":"event of default has occurred with respect to the referenced debt obligation upon which the swap is","page_number":343,"box":{"x":116,"y":490,"width":741,"height":12}},{"id":"5e56e798-d7f9-400e-aa81-c341d44a6920","block_type":"box","text":"based. If a default occurs, the stream of payments may stop and the issuer would be obligated to pay","page_number":343,"box":{"x":117,"y":506,"width":756,"height":12}},{"id":"97f2f775-c2a8-40f2-8ca1-3a6452e0c0bf","block_type":"box","text":"the counterparty the par (or other agreed upon value) of the referenced debt obligation. This, in turn,","page_number":343,"box":{"x":116,"y":521,"width":749,"height":12}},{"id":"77685326-fa7d-4f4c-87f2-eb82149f89fe","block_type":"box","text":"would reduce the amount of income and principal that","page_number":343,"box":{"x":116,"y":537,"width":404,"height":12}},{"id":"29778add-6624-4124-a5f3-3876c3ed07ae","block_type":"box","text":"a Fund would receive. A Fund’s investments in","page_number":343,"box":{"x":521,"y":537,"width":351,"height":9}},{"id":"9e24ecff-36e2-468d-ac89-a8bd42c96fc4","block_type":"box","text":"these instruments are indirectly subject to the risks associated with derivative instruments, including,","page_number":343,"box":{"x":116,"y":552,"width":750,"height":12}},{"id":"d48fb543-6b08-4da3-93e7-265f5aa18ea0","block_type":"box","text":"among others, credit risk, default or similar event risk, counterparty risk, interest rate risk, leverage risk","page_number":343,"box":{"x":116,"y":568,"width":766,"height":12}},{"id":"4c3da359-6978-44a5-b949-ecc17df0595d","block_type":"box","text":"and management risk. It is also expected that the securities will be exempt from registration under the","page_number":343,"box":{"x":116,"y":583,"width":761,"height":12}},{"id":"6131cc35-bb46-4913-bdc7-c7aaeaa0740b","block_type":"box","text":"Securities Act. Accordingly, there may be no established trading market for the securities and they may","page_number":343,"box":{"x":116,"y":599,"width":771,"height":12}},{"id":"c848d177-0be5-465e-9459-62d77515c2c8","block_type":"box","text":"constitute illiquid investments.","page_number":343,"box":{"x":116,"y":614,"width":227,"height":12}},{"id":"e47de899-1c43-49bd-abf0-b40e69741db8","block_type":"box","text":"Debt Securities.","page_number":343,"box":{"x":116,"y":645,"width":126,"height":10}},{"id":"1437ff2a-ba2e-47b0-824f-4e069a9643e2","block_type":"box","text":"Debt securities, such as bonds, involve credit risk. This is the risk that the issuer will","page_number":343,"box":{"x":243,"y":645,"width":633,"height":11}},{"id":"7a3935ac-f210-4912-a4ae-c3216f5ffa08","block_type":"box","text":"not make timely payments of principal and interest. The degree of credit risk depends on the issuer’s","page_number":343,"box":{"x":117,"y":661,"width":746,"height":12}},{"id":"285061dd-8564-44a3-833c-ff984a3d0513","block_type":"box","text":"financial condition and on the terms of the debt securities. Changes in an issuer’s credit rating or the","page_number":343,"box":{"x":116,"y":676,"width":744,"height":12}},{"id":"c4a033ff-b3d0-4200-86c2-b152db995ba7","block_type":"box","text":"market’s perception of an issuer’s creditworthiness may also affect the value of a Fund’s investment in","page_number":343,"box":{"x":117,"y":692,"width":757,"height":12}},{"id":"9fae4028-c7d7-4ef4-b5a6-b008098a0e4f","block_type":"box","text":"that issuer. Credit risk is reduced to the extent a Fund limits its debt investments to U.S. Government","page_number":343,"box":{"x":116,"y":707,"width":749,"height":10}},{"id":"9940ec0f-522e-4052-b3c7-57f35a2f31ee","block_type":"box","text":"Securities.","page_number":343,"box":{"x":116,"y":723,"width":77,"height":9}},{"id":"3122c9af-e20e-49cb-837a-9a22d9ff716c","block_type":"box","text":"All debt securities, however, are subject to interest rate risk. This is the risk that the value of the","page_number":343,"box":{"x":116,"y":754,"width":709,"height":12}},{"id":"bdd438b0-2d51-4de1-bd93-4a27981efd3f","block_type":"box","text":"security may fall when interest rates rise. If interest rates move sharply in a manner not anticipated by","page_number":343,"box":{"x":116,"y":769,"width":755,"height":12}},{"id":"3a58d5a5-6164-4518-8bec-82d8bd8d0281","block_type":"box","text":"Fund management, a Fund’s investments in debt securities could be adversely affected and the Fund","page_number":343,"box":{"x":117,"y":785,"width":752,"height":12}},{"id":"4d7c2589-2607-46f7-9f6c-de145e7c8436","block_type":"box","text":"could lose money. In general, the market price of debt securities with longer maturities will go up or","page_number":343,"box":{"x":116,"y":800,"width":735,"height":12}},{"id":"a1fa6075-845b-46da-b465-342bbffbaf0f","block_type":"box","text":"down more in response to changes in interest rates than will the market price of shorter-term debt","page_number":343,"box":{"x":116,"y":816,"width":725,"height":12}},{"id":"609512bd-bea1-4a34-9d99-da3c951ac281","block_type":"box","text":"securities.","page_number":343,"box":{"x":116,"y":831,"width":80,"height":10}},{"id":"628c6638-0080-40f7-bedc-d2a2772cacba","block_type":"box","text":"During periods of rising interest rates, the average life of certain fixed-income securities is extended","page_number":343,"box":{"x":117,"y":862,"width":744,"height":12}},{"id":"9c747448-0b9a-41a0-9fb3-95af88579e88","block_type":"box","text":"because of slower than expected principal payments. This may lock in a below-market interest rate and","page_number":343,"box":{"x":117,"y":878,"width":771,"height":12}},{"id":"e92208ba-d62e-4942-9322-15378a2e9741","block_type":"box","text":"II-11","page_number":343,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"b847272a-3468-4a67-bda4-06e660c2bd7a","block_type":"box","text":"NM1026U-6004382-343/605","page_number":343,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9a3ca565-13e6-43f0-8f6a-10e696c8c939","block_type":"box","text":"extend the duration of these fixed-income securities, especially mortgage-related securities, making","page_number":344,"box":{"x":116,"y":87,"width":744,"height":12}},{"id":"d7cc6072-084f-483e-83bd-9b65026e988f","block_type":"box","text":"them more sensitive to changes in interest rates. As a result, in a period of rising interest rates, these","page_number":344,"box":{"x":116,"y":102,"width":755,"height":13}},{"id":"0e2f8dc8-3951-4747-a5d1-2d1a7d9d9f5a","block_type":"box","text":"securities may exhibit additional volatility and lose value. This is known as extension risk.","page_number":344,"box":{"x":116,"y":118,"width":665,"height":12}},{"id":"2c6d938e-ffd4-41c9-bd73-8a5a73e70d2c","block_type":"box","text":"The value of fixed-income securities in the Funds can be expected to vary inversely with changes in","page_number":344,"box":{"x":116,"y":146,"width":745,"height":12}},{"id":"f684b3b6-ca2d-48d1-bf3d-5c0c592f717d","block_type":"box","text":"prevailing interest rates. Fixed-income securities with longer maturities, which tend to produce higher","page_number":344,"box":{"x":117,"y":162,"width":753,"height":12}},{"id":"bf31a11c-a763-434a-817a-5531ad0c8dcc","block_type":"box","text":"yields, are subject to potentially greater capital appreciation and depreciation than securities with","page_number":344,"box":{"x":116,"y":178,"width":723,"height":11}},{"id":"1987adc6-ef9a-4599-aefe-2430bc51885f","block_type":"box","text":"shorter maturities. The Funds are not restricted to any maximum or minimum time to maturity in","page_number":344,"box":{"x":116,"y":193,"width":714,"height":12}},{"id":"7b0f5cf8-9d04-4a8f-a723-8dd1a77f436f","block_type":"box","text":"purchasing individual portfolio securities, and the average maturity of a Fund’s assets will vary.","page_number":344,"box":{"x":117,"y":208,"width":707,"height":12}},{"id":"133dbead-f52b-4122-9de3-cc396b519f03","block_type":"box","text":"Floating and Variable Rate Securities","page_number":344,"box":{"x":116,"y":237,"width":277,"height":12}},{"id":"442598fe-4502-48e3-aaf9-593891e247f4","block_type":"box","text":". Certain Funds may invest in debt instruments that pay a variable","page_number":344,"box":{"x":395,"y":237,"width":493,"height":12}},{"id":"031a41cc-4d9e-40e2-82b6-b3c0dedab044","block_type":"box","text":"coupon rate. Securities with floating or variable interest rates can be less sensitive to interest rate","page_number":344,"box":{"x":116,"y":252,"width":728,"height":12}},{"id":"b2007b2b-8612-4fda-9ec3-c9597e87db21","block_type":"box","text":"changes than securities with fixed interest rates, but may decline in value if their interest rates do not","page_number":344,"box":{"x":116,"y":268,"width":752,"height":12}},{"id":"a912a07b-dfab-4a5e-b37c-541ce3ce655f","block_type":"box","text":"rise as much, or as quickly, as interest rates in general. Conversely, floating rate securities will not","page_number":344,"box":{"x":117,"y":283,"width":732,"height":12}},{"id":"615d89be-4686-4148-8cba-658875ad700e","block_type":"box","text":"generally increase in value if interest rates decline. The","page_number":344,"box":{"x":116,"y":299,"width":415,"height":12}},{"id":"028a5fdf-87d5-41ae-9d87-e3c806f9abdc","block_type":"box","text":"impact of interest rate changes on floating rate","page_number":344,"box":{"x":532,"y":299,"width":350,"height":12}},{"id":"6eb499f6-b978-4a57-a63b-44d50b4872cf","block_type":"box","text":"investments is typically mitigated by the periodic interest rate reset of the investments. Benchmark","page_number":344,"box":{"x":117,"y":314,"width":733,"height":12}},{"id":"f991bf8d-47e2-4a05-9ef3-bcdfc16fc2e5","block_type":"box","text":"interest rates used for floating and variable rate securities may not accurately track market interest","page_number":344,"box":{"x":117,"y":330,"width":734,"height":12}},{"id":"d4cbeecf-914d-49d9-9ce8-f0c8dd7ff650","block_type":"box","text":"rates.","page_number":344,"box":{"x":117,"y":346,"width":45,"height":9}},{"id":"b130464d-5f9a-4845-82c4-b690950914cf","block_type":"box","text":"Inflation-Indexed Bonds.","page_number":344,"box":{"x":117,"y":374,"width":179,"height":9}},{"id":"001e5bab-0f08-449d-8281-4d96a3d25be6","block_type":"box","text":"Certain Funds may invest in inflation-indexed bonds, which are fixed-income","page_number":344,"box":{"x":297,"y":374,"width":577,"height":12}},{"id":"d589e9b3-501b-4eef-b61a-6579a3fd0dc9","block_type":"box","text":"securities or other instruments whose principal value is periodically adjusted according to the rate of","page_number":344,"box":{"x":116,"y":389,"width":746,"height":12}},{"id":"de3bf7a9-22cf-41f5-9143-22c28c099ca2","block_type":"box","text":"inflation. Two structures are common. The U.S. Treasury and some other issuers use a structure that","page_number":344,"box":{"x":117,"y":405,"width":755,"height":12}},{"id":"7922c649-2e04-4da1-ae59-79ccc956ea33","block_type":"box","text":"accrues inflation into the principal value of the bond. Most other issuers pay out the Consumer Price","page_number":344,"box":{"x":116,"y":420,"width":747,"height":12}},{"id":"20e67cd7-0843-4692-9750-c6feaec2edae","block_type":"box","text":"Index (“CPI”) accruals as part of a semi-annual coupon.","page_number":344,"box":{"x":117,"y":436,"width":417,"height":12}},{"id":"99c08759-8400-4228-be55-7442346fe638","block_type":"box","text":"Inflation-indexed securities issued by the U.S. Treasury have maturities of five, ten or thirty years,","page_number":344,"box":{"x":117,"y":464,"width":728,"height":12}},{"id":"9cbc0781-774c-4cba-8d0b-9bd225a2e116","block_type":"box","text":"although it is possible that securities with other maturities will be issued in the future. The U.S.","page_number":344,"box":{"x":116,"y":480,"width":703,"height":12}},{"id":"9ace05a3-c4c6-4f53-9f70-14b17d7c955f","block_type":"box","text":"Treasury securities pay interest on a semi-annual basis, equal to a fixed percentage of the inflation","page_number":344,"box":{"x":116,"y":495,"width":738,"height":12}},{"id":"3cb2c5ef-b48b-4eb7-821e-a4772b11e585","block_type":"box","text":"adjusted principal amount. For example, if a Fund purchased an inflation-indexed bond with a par","page_number":344,"box":{"x":116,"y":511,"width":727,"height":12}},{"id":"82350286-7ec9-460d-a699-ed7fe626f4c9","block_type":"box","text":"value of $1,000 and a 3% real rate of return coupon (payable 1.5% semi-annually), and inflation over","page_number":344,"box":{"x":116,"y":525,"width":753,"height":13}},{"id":"9826bb6a-d0b7-4dc5-ba70-9fadd0554fae","block_type":"box","text":"the first six months was 1%, the mid-year par value of the bond would be $1,010 and the first semi","page_number":344,"box":{"x":116,"y":541,"width":736,"height":13}},{"id":"047a5194-bb50-41b3-ac49-93ab74f4d725","block_type":"box","text":"annual interest payment would be $15.15 ($1,010 times 1.5%). If inflation during the second half of the","page_number":344,"box":{"x":116,"y":556,"width":766,"height":13}},{"id":"e1c643b2-656b-4bf8-bd69-3648c5c9c8d3","block_type":"box","text":"year resulted in the whole year’s inflation equaling 3%, the end-of-year par value of the bond would be","page_number":344,"box":{"x":116,"y":573,"width":764,"height":12}},{"id":"eaf24dd7-9488-41f6-8df0-63ba9739eebe","block_type":"box","text":"$1,030 and the second semi-annual interest payment would be $15.45 ($1,030 times 1.5%).","page_number":344,"box":{"x":116,"y":587,"width":689,"height":13}},{"id":"5460a188-a01b-43ed-8219-938f52340ae7","block_type":"box","text":"If the periodic adjustment rate measuring inflation falls, the principal value of inflation-indexed bonds","page_number":344,"box":{"x":117,"y":616,"width":747,"height":12}},{"id":"f32e967c-b4a4-4e6c-b147-7d8a2eb8219d","block_type":"box","text":"will be adjusted downward, and, consequently, the interest payable on these securities (calculated with","page_number":344,"box":{"x":116,"y":632,"width":769,"height":12}},{"id":"2204a3d2-7d8b-451b-887f-b8a8d2630acf","block_type":"box","text":"respect to a smaller principal amount) will be reduced. Repayment of the original bond principal upon","page_number":344,"box":{"x":117,"y":647,"width":754,"height":13}},{"id":"468f11f8-a560-45be-a053-9a536b388beb","block_type":"box","text":"maturity (as adjusted for inflation) is guaranteed in the case of U.S. Treasury inflation-indexed bonds,","page_number":344,"box":{"x":117,"y":663,"width":749,"height":12}},{"id":"58d40677-947d-4b8c-8d92-dd6cc747d0c4","block_type":"box","text":"even during a period of deflation. However, the current market value of the bonds is not guaranteed,","page_number":344,"box":{"x":116,"y":678,"width":742,"height":13}},{"id":"a5d144ee-93fb-4466-9c6e-7ec7fe910207","block_type":"box","text":"and will fluctuate. Certain Funds may also invest in other inflation related bonds which may or may not","page_number":344,"box":{"x":116,"y":694,"width":758,"height":12}},{"id":"4bb95272-5dd0-48a7-883e-91be48bf3558","block_type":"box","text":"provide a similar guarantee. If a guarantee of principal is not provided, the adjusted principal value of","page_number":344,"box":{"x":117,"y":709,"width":748,"height":13}},{"id":"8c4706e2-1fa8-4380-a26a-bb7a7fd19f29","block_type":"box","text":"the bond repaid at maturity may be less than the original principal. In addition, if the Fund purchases","page_number":344,"box":{"x":116,"y":725,"width":744,"height":12}},{"id":"a31648e0-9fa4-461d-879b-0b6a4f1b7c64","block_type":"box","text":"inflation-indexed bonds offered by foreign issuers, the rate of inflation measured by the foreign inflation","page_number":344,"box":{"x":117,"y":740,"width":761,"height":13}},{"id":"e8053808-f89d-4338-bb36-d67e5f1bae2d","block_type":"box","text":"index may not be correlated to the rate of inflation in the United States.","page_number":344,"box":{"x":117,"y":756,"width":523,"height":12}},{"id":"d46ee519-6813-4165-b05f-5193ef3c0516","block_type":"box","text":"The value of inflation-indexed bonds is expected to change in response to changes in real interest","page_number":344,"box":{"x":116,"y":784,"width":727,"height":12}},{"id":"ff6642b8-7b14-41b7-92a5-2ad2d3452738","block_type":"box","text":"rates. Real interest rates, in turn, are tied to the relationship between nominal interest rates and the","page_number":344,"box":{"x":117,"y":800,"width":736,"height":12}},{"id":"97253225-25df-4253-a49c-9a683db4ed4d","block_type":"box","text":"rate of inflation. Therefore, if inflation were to rise at a faster rate than nominal interest rates, real","page_number":344,"box":{"x":117,"y":815,"width":717,"height":12}},{"id":"863735ed-79af-4d72-9866-a6901f97db51","block_type":"box","text":"interest rates might decline, leading to an increase in value of inflation-indexed bonds. In contrast, if","page_number":344,"box":{"x":117,"y":831,"width":743,"height":12}},{"id":"3e02c633-c702-4f7a-b457-1b6a42dcc58f","block_type":"box","text":"nominal interest rates increased at a faster rate than inflation, real interest rates might rise, leading to a","page_number":344,"box":{"x":117,"y":846,"width":769,"height":12}},{"id":"a43a5c37-9cc1-4bf9-a188-d1c35b6fd1d3","block_type":"box","text":"decrease in value of inflation-indexed bonds. There can be no assurance, however, that the value of","page_number":344,"box":{"x":116,"y":862,"width":749,"height":11}},{"id":"5dd34fc7-19d1-40a9-9f0a-7dedb7427e5e","block_type":"box","text":"inflation-indexed bonds will be directly correlated to changes in interest rates.","page_number":344,"box":{"x":117,"y":877,"width":577,"height":12}},{"id":"2498d383-f888-46d4-ac15-6915addb12c7","block_type":"box","text":"II-12","page_number":344,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"4eedd9ff-63a6-4b68-8987-e119f6364799","block_type":"box","text":"NM1026U-6004382-344/605","page_number":344,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6c9fdd0c-3e3c-4b80-93a4-4aab9a70f7b9","block_type":"box","text":"While these securities are expected to be protected from long-term inflationary trends, short-term","page_number":345,"box":{"x":116,"y":87,"width":725,"height":12}},{"id":"5e73d241-4de8-4965-bd2b-ec3d905e3e1c","block_type":"box","text":"increases in inflation may lead to a decline in value. If interest rates rise due to reasons other than","page_number":345,"box":{"x":117,"y":102,"width":731,"height":13}},{"id":"9217cfb6-2d32-4dbf-a97c-dc679ba924a6","block_type":"box","text":"inflation (for example, due to changes in currency exchange rates), investors in these securities may","page_number":345,"box":{"x":117,"y":118,"width":749,"height":12}},{"id":"43218af1-4b0c-4026-92d1-5e0c3a9c58cf","block_type":"box","text":"not be protected to the extent that the increase is not reflected in the bond’s inflation measure.","page_number":345,"box":{"x":117,"y":134,"width":704,"height":11}},{"id":"ac88fc37-1af6-4016-84fa-e818dcd789d1","block_type":"box","text":"In general, the measure used to determine the periodic adjustment of U.S. inflation-indexed bonds is","page_number":345,"box":{"x":117,"y":163,"width":750,"height":13}},{"id":"3a9a567a-697f-4a27-8d41-9f5053b05cd1","block_type":"box","text":"the Consumer Price Index for Urban Consumers (“CPI-U”), which is calculated monthly by the U.S.","page_number":345,"box":{"x":116,"y":179,"width":739,"height":12}},{"id":"3b672f58-f32f-4e15-ba5d-e38071b80de2","block_type":"box","text":"Bureau of Labor Statistics. The CPI-U is a measurement of changes in the cost of living, made up of","page_number":345,"box":{"x":117,"y":194,"width":747,"height":13}},{"id":"be57ee49-b341-42eb-b4d5-9fe3022ae1df","block_type":"box","text":"components such as housing, food, transportation and energy. Inflation-indexed bonds issued by a","page_number":345,"box":{"x":116,"y":210,"width":739,"height":12}},{"id":"17a31e82-034b-4534-928b-830a14f714c9","block_type":"box","text":"foreign government are generally adjusted to reflect a comparable inflation index, calculated by that","page_number":345,"box":{"x":116,"y":225,"width":743,"height":13}},{"id":"14da5c5d-8211-4f28-9dd7-9d09122bf30b","block_type":"box","text":"government. There can be no assurance that the CPI-U or any foreign inflation index will accurately","page_number":345,"box":{"x":116,"y":241,"width":744,"height":12}},{"id":"260b58c1-b4d9-40f5-822a-2c87cbd025b5","block_type":"box","text":"measure the real rate of inflation in the prices of goods and services. Moreover, there can be no","page_number":345,"box":{"x":117,"y":256,"width":716,"height":13}},{"id":"93bc90ce-dab2-43fe-b338-ee31023cb8d3","block_type":"box","text":"assurance that the rate of inflation in a foreign country will be correlated to the rate of inflation in the","page_number":345,"box":{"x":116,"y":272,"width":745,"height":12}},{"id":"e44c2a63-3a7a-4216-9104-46dbd260d10c","block_type":"box","text":"United States.","page_number":345,"box":{"x":117,"y":287,"width":109,"height":10}},{"id":"a87d403a-1449-4386-8379-4f367ae42173","block_type":"box","text":"Any increase in the principal amount of an inflation-indexed bond will be considered taxable ordinary","page_number":345,"box":{"x":116,"y":317,"width":750,"height":12}},{"id":"2bd798d6-7d9a-41b6-9d53-640105feab10","block_type":"box","text":"income, even though investors do not receive their principal until maturity.","page_number":345,"box":{"x":117,"y":333,"width":552,"height":12}},{"id":"ec06c46e-e4f5-4eaf-8931-b6cbac47b2c2","block_type":"box","text":"Investment Grade Debt Obligations.","page_number":345,"box":{"x":117,"y":363,"width":265,"height":12}},{"id":"a7baf4e3-e684-4247-a274-838ee0bc1fbc","block_type":"box","text":"Certain Funds may invest in “investment grade securities,” which","page_number":345,"box":{"x":383,"y":363,"width":492,"height":12}},{"id":"d5cf966b-44a0-420e-b40f-4b22b408212d","block_type":"box","text":"are securities rated in the four highest rating categories of an NRSRO or deemed to be of equivalent","page_number":345,"box":{"x":116,"y":378,"width":750,"height":12}},{"id":"c6934055-0431-49d5-bef0-16375b422bcf","block_type":"box","text":"quality by a Fund’s Manager. Certain Funds may invest in debt securities rated Aaa by Moody’s or","page_number":345,"box":{"x":116,"y":394,"width":734,"height":12}},{"id":"4d732924-fd2c-42b3-ab03-34c473417c62","block_type":"box","text":"AAA by S&P. It should be noted that debt obligations rated in the lowest of the top four ratings (","page_number":345,"box":{"x":116,"y":409,"width":708,"height":12}},{"id":"95df952b-dc40-4b28-b49b-d29fd0580d15","block_type":"box","text":"i.e.","page_number":345,"box":{"x":825,"y":409,"width":20,"height":10}},{"id":"20ca441a-55db-4420-a223-30807ebd9504","block_type":"box","text":",","page_number":345,"box":{"x":848,"y":417,"width":8,"height":3}},{"id":"5752c046-3c76-4ee2-890e-34db3a63b0ca","block_type":"box","text":"“Baa” by Moody’s or “BBB” by S&P) are considered to have some speculative characteristics and are","page_number":345,"box":{"x":116,"y":425,"width":756,"height":12}},{"id":"ab92d764-2c9a-4443-8e4e-30bd3f2ddf80","block_type":"box","text":"more sensitive to economic change than higher rated securities. If an investment grade security of a","page_number":345,"box":{"x":117,"y":440,"width":747,"height":12}},{"id":"15c4db4e-b54c-414b-8e17-7a0ad8df5e5e","block_type":"box","text":"Fund is subsequently downgraded below investment grade, the Fund’s Manager will consider such an","page_number":345,"box":{"x":117,"y":456,"width":761,"height":12}},{"id":"a0f95638-0f99-4684-84cb-e99a0ac9f660","block_type":"box","text":"event in determining whether the Fund should continue to hold the security. Subject to its investment","page_number":345,"box":{"x":116,"y":471,"width":752,"height":12}},{"id":"c05e8483-93d0-41e2-92fa-3922cc63bf32","block_type":"box","text":"strategies, there is no limit on the amount of such downgraded securities a Fund may hold.","page_number":345,"box":{"x":116,"y":487,"width":679,"height":12}},{"id":"a7763bb6-c8b9-46f9-85f9-53a3f84709d8","block_type":"box","text":"See Appendix A to this SAI for a description of applicable securities ratings.","page_number":345,"box":{"x":116,"y":517,"width":566,"height":12}},{"id":"84ba8a31-73bd-4357-8c9a-3e3da277e595","block_type":"box","text":"High Yield Investments (“Junk Bonds”).","page_number":345,"box":{"x":116,"y":547,"width":296,"height":12}},{"id":"1b376c19-edfd-4008-974f-5327d15d000e","block_type":"box","text":"Non-investment grade or “high yield” fixed-income or convertible securities commonly known to","page_number":345,"box":{"x":117,"y":569,"width":711,"height":12}},{"id":"82d9add8-4c0d-4569-96e6-3f30215f218c","block_type":"box","text":"investors as “junk bonds” are debt securities that are rated below investment grade by the major rating","page_number":345,"box":{"x":117,"y":585,"width":764,"height":12}},{"id":"1631b97a-c0db-44e9-b525-f569db8694ca","block_type":"box","text":"agencies or are securities that Fund management believes are of comparable quality. While generally","page_number":345,"box":{"x":116,"y":600,"width":759,"height":12}},{"id":"7d301212-88a1-4ab4-8cc8-a2a962670133","block_type":"box","text":"providing greater income and opportunity for gain, non-investment grade debt securities may be","page_number":345,"box":{"x":117,"y":616,"width":715,"height":12}},{"id":"7f78d25c-c526-4c5c-bb73-0b5024ae65dd","block_type":"box","text":"subject to greater risks than securities which have higher credit ratings, including a high risk of default,","page_number":345,"box":{"x":116,"y":631,"width":764,"height":12}},{"id":"34d8315b-df96-4347-9c7e-04a2a8dc89d6","block_type":"box","text":"and their yields will fluctuate over time. High yield securities will generally be in the lower rating","page_number":345,"box":{"x":116,"y":647,"width":709,"height":12}},{"id":"a6146422-e256-4cbd-be16-e38c3f57a0c1","block_type":"box","text":"categories of recognized rating agencies (rated “Ba” or lower by Moody’s or “BB” or lower by S&P) or","page_number":345,"box":{"x":116,"y":662,"width":750,"height":12}},{"id":"21e417f9-3668-4719-b5e4-f295b87abb7f","block_type":"box","text":"will be non-rated. The credit rating of a high yield security does not necessarily address its market","page_number":345,"box":{"x":116,"y":678,"width":726,"height":12}},{"id":"09b70c14-7c08-4940-b87e-98fd009093c7","block_type":"box","text":"value risk, and ratings may from time to time change, positively or negatively, to reflect developments","page_number":345,"box":{"x":116,"y":693,"width":752,"height":12}},{"id":"f0274125-40ef-4386-ae2d-76d95280a883","block_type":"box","text":"regarding the issuer’s financial condition. High yield securities are considered to be speculative with","page_number":345,"box":{"x":117,"y":709,"width":737,"height":12}},{"id":"bcc9e2d1-0ea4-4e36-9b22-7685e0386f81","block_type":"box","text":"respect to the capacity of the issuer to timely repay principal and pay interest or dividends in","page_number":345,"box":{"x":117,"y":724,"width":682,"height":12}},{"id":"401a0463-3a47-4a5e-968a-47531aecb8a1","block_type":"box","text":"accordance with the terms of the obligation and may have more credit risk than higher rated securities.","page_number":345,"box":{"x":116,"y":740,"width":761,"height":12}},{"id":"0fa7a541-74f8-4d69-8713-74d4e8d9e1ea","block_type":"box","text":"The major risks in junk bond investments include the following:","page_number":345,"box":{"x":116,"y":770,"width":464,"height":12}},{"id":"2a162f47-3410-442c-bf85-3616d5187722","block_type":"box","text":"• Junk bonds may be issued by less creditworthy companies. These securities are vulnerable to","page_number":345,"box":{"x":117,"y":793,"width":731,"height":12}},{"id":"9a12fbeb-2bbb-4bdf-918d-b3e947eacacf","block_type":"box","text":"adverse changes in the issuer’s industry and to general economic conditions. Issuers of junk","page_number":345,"box":{"x":150,"y":808,"width":686,"height":12}},{"id":"22af36e6-acac-4da2-bdf2-8ce1ccc86a91","block_type":"box","text":"bonds may be unable to meet their interest or principal payment obligations because of an","page_number":345,"box":{"x":150,"y":823,"width":669,"height":13}},{"id":"63e56b34-5c83-4004-b8d9-216c86dffa54","block_type":"box","text":"economic downturn, specific issuer developments or the unavailability of additional financing.","page_number":345,"box":{"x":150,"y":839,"width":695,"height":12}},{"id":"2e0dd37d-e446-484f-a917-92b9fd3c51e7","block_type":"box","text":"• The issuers of junk bonds may have a larger amount of outstanding debt relative to their assets","page_number":345,"box":{"x":117,"y":862,"width":746,"height":12}},{"id":"af9de12f-1645-4beb-8d97-17bf9246a385","block_type":"box","text":"than issuers of investment grade bonds. If the issuer experiences financial stress, it may be","page_number":345,"box":{"x":150,"y":877,"width":684,"height":12}},{"id":"ad053b76-15e5-4844-bf51-6e408fb9e7f3","block_type":"box","text":"II-13","page_number":345,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"426b5d24-53a9-43cf-a625-52dff679edb2","block_type":"box","text":"NM1026U-6004382-345/605","page_number":345,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4adc3bae-e9f5-4ce7-97fe-8b1d9ce71e05","block_type":"box","text":"unable to meet its debt obligations. The issuer’s ability to pay its debt obligations also may be","page_number":346,"box":{"x":150,"y":87,"width":697,"height":12}},{"id":"b6abb88f-20d6-4dc3-b35f-c24a1e4ddbb5","block_type":"box","text":"lessened by specific issuer developments, or the unavailability of additional financing. Issuers of","page_number":346,"box":{"x":150,"y":102,"width":717,"height":13}},{"id":"a85487ed-3e34-4711-8a77-d53a5234fee7","block_type":"box","text":"high yield securities are often in the growth stage of their development and/or involved in a","page_number":346,"box":{"x":150,"y":118,"width":677,"height":12}},{"id":"9beb30a5-b10e-47d7-aeed-3ef881f3e085","block_type":"box","text":"reorganization or takeover.","page_number":346,"box":{"x":150,"y":134,"width":204,"height":12}},{"id":"2bc6b0c5-1685-41be-85b7-7606d9f24e88","block_type":"box","text":"• Junk bonds are frequently ranked junior to claims by other creditors. If the issuer cannot meet its","page_number":346,"box":{"x":117,"y":158,"width":754,"height":12}},{"id":"f8e00d44-81e7-460f-ae4e-815e888fa6b0","block_type":"box","text":"obligations, the senior obligations are generally paid off before the junior obligations, which will","page_number":346,"box":{"x":150,"y":173,"width":706,"height":12}},{"id":"77c0e064-0d2d-4beb-96fa-1f1657d50f39","block_type":"box","text":"potentially limit a Fund’s ability to fully recover principal or to receive interest payments when","page_number":346,"box":{"x":150,"y":189,"width":693,"height":12}},{"id":"b1ac0d25-a8f9-4683-8cf7-0904e06f855f","block_type":"box","text":"senior securities are in default. Thus, investors in high yield securities have a lower degree of","page_number":346,"box":{"x":150,"y":204,"width":696,"height":12}},{"id":"d9ee25cf-85b9-44d1-807b-0450cbba8d4d","block_type":"box","text":"protection with respect to principal and interest payments than do investors in higher rated","page_number":346,"box":{"x":150,"y":220,"width":674,"height":12}},{"id":"72bda85a-c798-4c8c-a5bf-5bb884f41147","block_type":"box","text":"securities.","page_number":346,"box":{"x":150,"y":236,"width":80,"height":9}},{"id":"f9a93d3f-d1b6-4ccc-9f26-ec0c7d9a18fa","block_type":"box","text":"• Junk bonds frequently have redemption features that permit an issuer to repurchase the security","page_number":346,"box":{"x":117,"y":260,"width":753,"height":12}},{"id":"b3c34dd4-8a2e-4d46-9c6b-2292cabd5352","block_type":"box","text":"from a Fund before it matures. If an issuer redeems the junk bonds, a Fund may have to invest the","page_number":346,"box":{"x":149,"y":275,"width":738,"height":12}},{"id":"ec37fad3-1b23-4873-8e14-1001257b5805","block_type":"box","text":"proceeds in bonds with lower yields and may lose income.","page_number":346,"box":{"x":150,"y":291,"width":437,"height":12}},{"id":"447dfebf-e180-4813-8171-36b11cf74a03","block_type":"box","text":"• Prices of junk bonds are subject to extreme price fluctuations. Negative economic developments","page_number":346,"box":{"x":117,"y":315,"width":753,"height":12}},{"id":"ea6bf696-8d66-4d3f-87e4-846494ac59a4","block_type":"box","text":"may have a greater impact on the prices of junk bonds than on those of other higher rated fixed","page_number":346,"box":{"x":150,"y":331,"width":713,"height":12}},{"id":"d1136c78-9d18-458e-9311-1728158e481c","block_type":"box","text":"income securities.","page_number":346,"box":{"x":150,"y":346,"width":139,"height":10}},{"id":"67378a3e-5ce1-41a2-8449-e9b5e19d8d90","block_type":"box","text":"• Junk bonds may be less liquid than higher rated fixed-income securities even under normal","page_number":346,"box":{"x":117,"y":370,"width":714,"height":13}},{"id":"2fa9e97d-f274-479f-beca-ecdb93cc42bf","block_type":"box","text":"economic conditions. Under certain economic and/or market conditions, a Fund may have difficulty","page_number":346,"box":{"x":150,"y":386,"width":738,"height":12}},{"id":"a087385d-d263-4659-b7dc-9c7f89e54077","block_type":"box","text":"disposing of certain high yield securities due to the limited number of investors in that sector of the","page_number":346,"box":{"x":150,"y":401,"width":734,"height":13}},{"id":"a14cd2ff-45cd-4bb4-84ed-32ce17d5e480","block_type":"box","text":"market. There are fewer dealers in the junk bond market, and there may be significant differences","page_number":346,"box":{"x":150,"y":417,"width":730,"height":12}},{"id":"219b22da-535b-491a-ac95-218600ebce18","block_type":"box","text":"in the prices quoted for junk bonds by the dealers, and such quotations may not be the actual","page_number":346,"box":{"x":150,"y":432,"width":698,"height":13}},{"id":"78413940-0c22-4c09-84cc-fff47815598c","block_type":"box","text":"prices available for a purchase or sale. Because junk bonds are less liquid than higher rated","page_number":346,"box":{"x":150,"y":448,"width":688,"height":12}},{"id":"1aac5e9f-5970-4570-b741-8bbe4d5e3156","block_type":"box","text":"bonds, judgment may play a greater role in valuing certain of a Fund’s portfolio securities than in","page_number":346,"box":{"x":150,"y":463,"width":720,"height":13}},{"id":"318026f3-65a2-46b8-8383-ff95c8190566","block_type":"box","text":"the case of securities trading in a more liquid market.","page_number":346,"box":{"x":150,"y":479,"width":398,"height":12}},{"id":"053bdd68-a3b7-4b89-a448-a3362838cfcd","block_type":"box","text":"• The secondary markets for high yield securities are not as liquid as the secondary markets for","page_number":346,"box":{"x":117,"y":503,"width":734,"height":12}},{"id":"ff362a61-d50f-4c52-8806-64d31b7b6620","block_type":"box","text":"higher rated securities. The secondary markets for high yield securities are concentrated in","page_number":346,"box":{"x":150,"y":519,"width":680,"height":12}},{"id":"19c571fc-630f-4143-a3bf-0096ddce4ac6","block_type":"box","text":"relatively few market makers and participants in the markets are mostly institutional investors,","page_number":346,"box":{"x":150,"y":534,"width":699,"height":12}},{"id":"5ed4e90d-3a15-4123-a5a0-9cb0bd51b6be","block_type":"box","text":"including insurance companies, banks, other financial institutions and mutual funds. In addition,","page_number":346,"box":{"x":150,"y":550,"width":712,"height":12}},{"id":"3c4b6f74-d31a-476a-9d1b-6fc232fff770","block_type":"box","text":"the trading volume for high yield securities is generally lower than that for higher rated securities","page_number":346,"box":{"x":150,"y":565,"width":718,"height":12}},{"id":"f4c9bc6b-3566-46ab-9c89-9f78e71cc66a","block_type":"box","text":"and the secondary markets could contract under adverse market or economic conditions","page_number":346,"box":{"x":150,"y":581,"width":662,"height":12}},{"id":"a1deece1-06f8-4001-9595-40643729c50c","block_type":"box","text":"independent of any specific adverse changes in the condition of a particular issuer. Under certain","page_number":346,"box":{"x":150,"y":596,"width":725,"height":12}},{"id":"2f67139d-ab56-417d-bad4-69932993bbf6","block_type":"box","text":"economic and/or market conditions, a Fund may have difficulty disposing of certain high yield","page_number":346,"box":{"x":150,"y":612,"width":695,"height":12}},{"id":"3379641c-e5ef-4017-9e84-e4c5f9364b51","block_type":"box","text":"securities due to the limited number of investors in that sector of the market. An illiquid secondary","page_number":346,"box":{"x":150,"y":627,"width":728,"height":12}},{"id":"9e8880d5-4a50-47f1-9589-230704f1303d","block_type":"box","text":"market may adversely affect the market price of the high yield security, which may result in","page_number":346,"box":{"x":150,"y":643,"width":678,"height":12}},{"id":"da3cd451-4da8-47d1-8e27-97209f0f98c4","block_type":"box","text":"increased difficulty selling the particular issue and obtaining accurate market quotations on the","page_number":346,"box":{"x":150,"y":658,"width":706,"height":12}},{"id":"cff915be-84ed-4990-912f-d059465ae7a8","block_type":"box","text":"issue when valuing a Fund’s assets. Market quotations on high yield securities are available only","page_number":346,"box":{"x":150,"y":674,"width":717,"height":12}},{"id":"c9a54758-e434-4740-bfb0-36dedf02fedd","block_type":"box","text":"from a limited number of dealers, and such quotations may not be the actual prices available for a","page_number":346,"box":{"x":149,"y":689,"width":726,"height":12}},{"id":"7bdc2b92-eb7c-4175-9487-7097ab08865a","block_type":"box","text":"purchase or sale. When the secondary market for high yield securities becomes more illiquid, or in","page_number":346,"box":{"x":150,"y":705,"width":728,"height":12}},{"id":"d9c47de3-517d-4d6a-b09f-70da9b14a7dd","block_type":"box","text":"the absence of readily available market quotations for such securities, the relative lack of reliable","page_number":346,"box":{"x":150,"y":720,"width":717,"height":12}},{"id":"97836277-4881-4b42-a8b5-a4402e676e95","block_type":"box","text":"objective data makes it more difficult to value a Fund’s securities, and judgment plays a more","page_number":346,"box":{"x":150,"y":736,"width":691,"height":12}},{"id":"d06d702b-b7b0-4568-9bfe-a059c3d3023f","block_type":"box","text":"important role in determining such valuations.","page_number":346,"box":{"x":150,"y":752,"width":337,"height":12}},{"id":"871ffff1-ef91-48bc-8674-0aa57542ad24","block_type":"box","text":"• A Fund may incur expenses to the extent necessary to seek recovery upon default or to negotiate","page_number":346,"box":{"x":117,"y":776,"width":757,"height":12}},{"id":"ebc1fcc8-f9cc-4831-b662-0edfea3dd2ee","block_type":"box","text":"new terms with a defaulting issuer.","page_number":346,"box":{"x":150,"y":791,"width":256,"height":12}},{"id":"a1738c89-c3f6-4489-bba9-91808082aea7","block_type":"box","text":"• The junk bond markets may react strongly to adverse news about an issuer or the economy, or to","page_number":346,"box":{"x":117,"y":816,"width":756,"height":12}},{"id":"69c59aba-4539-4cd4-a012-f54ab31ba608","block_type":"box","text":"the perception or expectation of adverse news, whether or not it is based on fundamental analysis.","page_number":346,"box":{"x":150,"y":831,"width":737,"height":12}},{"id":"dd37c91d-aa39-47f2-8453-43afff9e68a8","block_type":"box","text":"Additionally, prices for high yield securities may be affected by legislative and regulatory","page_number":346,"box":{"x":149,"y":847,"width":659,"height":12}},{"id":"6755a568-b35b-45eb-950e-2ee4bf8c203a","block_type":"box","text":"developments. These developments could adversely affect a Fund’s NAV and investment","page_number":346,"box":{"x":150,"y":862,"width":669,"height":12}},{"id":"45a099b1-9220-48be-aaa5-1cd577e18532","block_type":"box","text":"practices, the secondary market for high yield securities, the financial condition of issuers of these","page_number":346,"box":{"x":150,"y":878,"width":731,"height":12}},{"id":"f908e5c5-74d1-498b-8f85-0b61e4d7aaf9","block_type":"box","text":"II-14","page_number":346,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"3434c0c0-e37b-46d6-bcf0-3c3ed91d2019","block_type":"box","text":"NM1026U-6004382-346/605","page_number":346,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5b680b37-1158-410a-9d8a-c53959abbf2c","block_type":"box","text":"securities and the value and liquidity of outstanding high yield securities, especially in a thinly","page_number":347,"box":{"x":150,"y":87,"width":695,"height":12}},{"id":"6723007a-4ed5-424c-b79b-2fa26cf42558","block_type":"box","text":"traded market. For example, federal legislation requiring the divestiture by federally insured","page_number":347,"box":{"x":150,"y":102,"width":681,"height":13}},{"id":"9c91c6b3-2ca4-4cba-a8d9-bda7facc3686","block_type":"box","text":"savings and loan associations of their investments in high yield bonds and limiting the deductibility","page_number":347,"box":{"x":150,"y":118,"width":733,"height":12}},{"id":"8043537f-9f0b-4741-b3aa-3aa3d7c77cac","block_type":"box","text":"of interest by certain corporate issuers of high yield bonds adversely affected the market in the","page_number":347,"box":{"x":150,"y":134,"width":706,"height":12}},{"id":"1f89b534-29be-41ba-b36a-4e1f21b7d254","block_type":"box","text":"past.","page_number":347,"box":{"x":150,"y":149,"width":41,"height":12}},{"id":"c2d35957-acd5-472f-96e0-d7437a339666","block_type":"box","text":"• The rating assigned by a rating agency evaluates the issuing agency’s assessment of the safety of","page_number":347,"box":{"x":117,"y":172,"width":770,"height":12}},{"id":"787b5e54-eec4-4558-9ab7-96427b692ce8","block_type":"box","text":"a non-investment grade security’s principal and interest payments, but does not address market","page_number":347,"box":{"x":150,"y":187,"width":716,"height":12}},{"id":"b7b4b234-7c8d-4805-aa06-7260f8514765","block_type":"box","text":"value risk. Because such ratings of the ratings agencies may not always reflect current conditions","page_number":347,"box":{"x":150,"y":203,"width":728,"height":12}},{"id":"d056334a-be96-46a9-8d0d-b6040a74b7a1","block_type":"box","text":"and events, in addition to using recognized rating agencies and other sources, the Manager or","page_number":347,"box":{"x":150,"y":218,"width":705,"height":12}},{"id":"b6d55083-753f-4230-a8cc-3aa817cae147","block_type":"box","text":"sub-adviser performs its own analysis of the issuers whose non-investment grade securities a","page_number":347,"box":{"x":150,"y":234,"width":700,"height":12}},{"id":"af84e453-df40-4123-85a9-62055c5b0643","block_type":"box","text":"Fund holds. Because of this, the Fund’s performance may depend more on the Manager’s or","page_number":347,"box":{"x":151,"y":249,"width":693,"height":12}},{"id":"607420e7-2e7d-41fc-83e0-039e686ffeba","block_type":"box","text":"sub-adviser’s own credit analysis than in the case of mutual funds investing in higher-rated","page_number":347,"box":{"x":150,"y":265,"width":678,"height":12}},{"id":"418c3563-dea0-4dbd-9749-09af7efbf176","block_type":"box","text":"securities.","page_number":347,"box":{"x":150,"y":280,"width":80,"height":10}},{"id":"9037260c-b012-4fa4-a894-8f3ad351bbec","block_type":"box","text":"In selecting non-investment grade securities, the Manager or sub-adviser considers factors such as","page_number":347,"box":{"x":117,"y":310,"width":742,"height":12}},{"id":"fec17402-921c-4885-8a2e-bea9f884cb64","block_type":"box","text":"those relating to the creditworthiness of issuers, the ratings and performance of the securities, the","page_number":347,"box":{"x":116,"y":325,"width":731,"height":12}},{"id":"0bc9f9c9-8967-41d9-9245-bcf77d495fe0","block_type":"box","text":"protections afforded the securities and the diversity of the Fund. The Manager or sub-adviser","page_number":347,"box":{"x":117,"y":341,"width":694,"height":12}},{"id":"3145662d-7f62-4e58-811e-5653ee1ffb39","block_type":"box","text":"continuously monitors the issuers of non-investment grade securities held by the Fund for their ability","page_number":347,"box":{"x":116,"y":356,"width":755,"height":12}},{"id":"0abd7c27-0b8d-4ae9-906c-4f2ba4dd4e5d","block_type":"box","text":"to make required principal and interest payments, as well as in an effort to control the liquidity of the","page_number":347,"box":{"x":116,"y":372,"width":746,"height":12}},{"id":"b7429fd7-57f7-4637-b654-f9c0463d3027","block_type":"box","text":"Fund so that it can meet redemption requests. If a security’s rating is reduced below the minimum","page_number":347,"box":{"x":117,"y":387,"width":729,"height":12}},{"id":"eaf7e2f2-36a8-4292-8bfb-2a3c7ab8c952","block_type":"box","text":"credit rating that is permitted for a Fund, the Fund’s adviser or sub-adviser will consider whether the","page_number":347,"box":{"x":116,"y":403,"width":745,"height":12}},{"id":"dd281cde-978e-456c-8ec4-543ce0353425","block_type":"box","text":"Fund should continue to hold the security.","page_number":347,"box":{"x":117,"y":418,"width":315,"height":12}},{"id":"3ca0d978-93af-4ffd-bc3c-6687326cb136","block_type":"box","text":"In the event that a Fund investing in high yield securities experiences an unexpected level of net","page_number":347,"box":{"x":117,"y":448,"width":718,"height":12}},{"id":"45b4ef2a-aa4b-4298-9b20-f972cb1cd4c3","block_type":"box","text":"redemptions, the Fund could be forced to sell its holdings without regard to the investment merits,","page_number":347,"box":{"x":117,"y":463,"width":729,"height":12}},{"id":"0b41a607-a2ff-48ff-9f34-f90a921c0209","block_type":"box","text":"thereby decreasing the assets upon which the Fund’s rate of return is based.","page_number":347,"box":{"x":116,"y":479,"width":575,"height":12}},{"id":"bd1f9ae7-f3c8-44ba-a138-933e11187073","block_type":"box","text":"The costs attributable to investing in the junk bond markets are usually higher for several reasons,","page_number":347,"box":{"x":116,"y":508,"width":733,"height":12}},{"id":"4536429f-c80a-4fd4-a2cd-325967209e36","block_type":"box","text":"such as higher investment research costs and higher commission costs.","page_number":347,"box":{"x":116,"y":524,"width":540,"height":12}},{"id":"391c67bd-60da-4900-a53c-87ebac3486b1","block_type":"box","text":"Mezzanine Investments.","page_number":347,"box":{"x":116,"y":554,"width":179,"height":9}},{"id":"a0772c79-d3fc-424e-a82d-ed023ce1b76d","block_type":"box","text":"Certain Funds, consistent with their restrictions on investing in securities of a","page_number":347,"box":{"x":297,"y":553,"width":579,"height":13}},{"id":"7d90d3df-e3d0-49d7-9423-600ff29a6638","block_type":"box","text":"specific credit quality, may invest in certain high yield securities known as mezzanine investments,","page_number":347,"box":{"x":116,"y":569,"width":735,"height":12}},{"id":"bb9a9c0e-f655-47a4-a3ca-d3cd4a16bf8e","block_type":"box","text":"which are subordinated debt securities which are generally issued in private placements in connection","page_number":347,"box":{"x":116,"y":585,"width":762,"height":12}},{"id":"d9d7f965-7791-4137-b234-029d2ea0fbd0","block_type":"box","text":"with an equity security (","page_number":347,"box":{"x":116,"y":600,"width":175,"height":12}},{"id":"5d5d589a-1556-41a2-9c31-2e28be1ae80c","block_type":"box","text":"e.g.","page_number":347,"box":{"x":292,"y":603,"width":26,"height":9}},{"id":"0f29352b-0eac-4098-b792-8bcfb568d083","block_type":"box","text":", with attached warrants). Such mezzanine investments may be issued with","page_number":347,"box":{"x":321,"y":600,"width":563,"height":12}},{"id":"27625e39-ef1c-4551-bd14-5756fd1b2e7e","block_type":"box","text":"or without registration rights. Similar to other high yield securities, maturities of mezzanine investments","page_number":347,"box":{"x":116,"y":615,"width":767,"height":13}},{"id":"9ddfe2c9-d1e3-4fbc-9df2-248dabe7d257","block_type":"box","text":"are typically seven to ten years, but the expected average life is significantly shorter at three to five","page_number":347,"box":{"x":116,"y":631,"width":738,"height":12}},{"id":"d47da9f1-8373-4244-8e76-23fdf4eeb2dc","block_type":"box","text":"years. Mezzanine investments are usually unsecured and subordinate to other obligations of the","page_number":347,"box":{"x":116,"y":646,"width":719,"height":13}},{"id":"da3b18b9-2c61-49f5-825a-b0334260fc6b","block_type":"box","text":"issuer.","page_number":347,"box":{"x":117,"y":662,"width":47,"height":10}},{"id":"c5cc25a5-6991-4908-8f4b-6546d5d1e7fd","block_type":"box","text":"Pay-in-kind Bonds.","page_number":347,"box":{"x":116,"y":692,"width":142,"height":12}},{"id":"6bb867d0-8340-49cf-8988-cdf24d55d5f1","block_type":"box","text":"Certain Funds may invest in pay-in-kind, or PIK, bonds. PIK bonds are bonds","page_number":347,"box":{"x":266,"y":692,"width":584,"height":12}},{"id":"9c80e210-f813-459a-ba98-5b76e4910af5","block_type":"box","text":"which pay interest through the issuance of additi","page_number":347,"box":{"x":116,"y":707,"width":366,"height":12}},{"id":"9062d5f3-341d-480b-930e-29706c3d2127","block_type":"box","text":"onal debt or equity securities. Similar to zero","page_number":347,"box":{"x":484,"y":707,"width":338,"height":12}},{"id":"8b0f46d5-5357-4ab7-96ce-d323b8c989e9","block_type":"box","text":"coupon obligations, pay-in-kind bonds also carry additional risk as holders of these types of","page_number":347,"box":{"x":116,"y":723,"width":694,"height":12}},{"id":"97962d7c-eab5-4c7a-ac44-25e745521919","block_type":"box","text":"securities realize no cash until the cash payment dat","page_number":347,"box":{"x":116,"y":738,"width":398,"height":12}},{"id":"5750ccbe-749b-401a-a2e4-833a3d4c17c5","block_type":"box","text":"e unless a portion of such securities is sold and,","page_number":347,"box":{"x":515,"y":738,"width":364,"height":12}},{"id":"3f6a1e27-5935-40f7-bc5f-15000ea650e0","block_type":"box","text":"if the issuer defaults, a Fund may obtain no return","page_number":347,"box":{"x":117,"y":754,"width":377,"height":12}},{"id":"87743c04-00d7-45b0-87ea-9ddeccf09464","block_type":"box","text":"at all on its investment. The market price of","page_number":347,"box":{"x":500,"y":754,"width":329,"height":12}},{"id":"a3b8b42a-a4b1-4410-8ce6-9f7ceafcc204","block_type":"box","text":"pay-in-kind bonds is affected by interest rate changes","page_number":347,"box":{"x":117,"y":769,"width":406,"height":12}},{"id":"e3d7123d-6a1c-4821-8add-7e0bed0df283","block_type":"box","text":"to a greater extent, and therefore tends to be","page_number":347,"box":{"x":529,"y":769,"width":341,"height":12}},{"id":"a0fb5526-7c58-4d5f-b901-8de9dbda3725","block_type":"box","text":"more volatile, than that of securities which pay inte","page_number":347,"box":{"x":117,"y":785,"width":383,"height":12}},{"id":"f1e3edcc-c393-4718-b124-4968c1c59193","block_type":"box","text":"rest in cash. Additionally, current U.S. federal tax","page_number":347,"box":{"x":502,"y":785,"width":371,"height":12}},{"id":"73fb2715-d12c-4de2-8ecd-8bd039ce78f2","block_type":"box","text":"law requires the holder of pay-in-kind bonds to accrue","page_number":347,"box":{"x":117,"y":800,"width":408,"height":12}},{"id":"bbae29ce-9ae9-429f-aa21-02209ad9dfe0","block_type":"box","text":"income with respect to these securities prior","page_number":347,"box":{"x":531,"y":800,"width":334,"height":12}},{"id":"50b0a5f6-10d3-426c-9082-13e67717bbf3","block_type":"box","text":"to the receipt of cash payments. To maintain it","page_number":347,"box":{"x":116,"y":816,"width":352,"height":12}},{"id":"abee4a27-2d41-45c4-87f3-213a48004b97","block_type":"box","text":"s qualification as a regulated investment company","page_number":347,"box":{"x":469,"y":816,"width":379,"height":12}},{"id":"64ed7366-82cf-45f3-ae0e-fed7759ce94e","block_type":"box","text":"and avoid liability for U.S. federal income and exci","page_number":347,"box":{"x":116,"y":831,"width":380,"height":12}},{"id":"9a0c0acb-72cf-426f-898b-4df8f82ff550","block_type":"box","text":"se taxes, each Fund may be required to distribute","page_number":347,"box":{"x":497,"y":831,"width":382,"height":12}},{"id":"5d6fcae3-e9dd-4127-8da6-52221b291b41","block_type":"box","text":"income accrued with respect to these securities","page_number":347,"box":{"x":117,"y":847,"width":365,"height":12}},{"id":"b9370ba1-3f76-4247-9caf-e0175443df86","block_type":"box","text":"and may have to dispose of portfolio securities","page_number":347,"box":{"x":483,"y":847,"width":358,"height":12}},{"id":"b3abc4ac-e0ac-456b-9114-84da956e15f0","block_type":"box","text":"under disadvantageous circumstances in order to","page_number":347,"box":{"x":117,"y":862,"width":379,"height":12}},{"id":"9078f050-2ee8-4e0e-9338-42c622dc205f","block_type":"box","text":"generate cash to satisfy these distribution","page_number":347,"box":{"x":497,"y":862,"width":321,"height":12}},{"id":"3cce56b5-d385-4818-9a6d-4cbf7852a52c","block_type":"box","text":"requirements.","page_number":347,"box":{"x":117,"y":878,"width":108,"height":12}},{"id":"b88eff2a-45c7-4887-b173-68deb1fb401e","block_type":"box","text":"II-15","page_number":347,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"12425e23-0f69-4dea-a23e-91e5583facf9","block_type":"box","text":"NM1026U-6004382-347/605","page_number":347,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9f3f6627-8b0a-4ba0-b057-ddad7266c794","block_type":"box","text":"Supranational Entities.","page_number":348,"box":{"x":117,"y":87,"width":165,"height":12}},{"id":"83638d0d-a234-434c-a6a1-c09119e0e7ae","block_type":"box","text":"A Fund may invest in debt securities of supranational entities. Examples of","page_number":348,"box":{"x":284,"y":87,"width":564,"height":12}},{"id":"219efb93-a97e-4103-8d03-77861a508e6c","block_type":"box","text":"such entities include the International Bank for Reconstruction and Development (the World Bank), the","page_number":348,"box":{"x":116,"y":102,"width":766,"height":13}},{"id":"93112cb6-3431-4e73-95d6-7028e324327d","block_type":"box","text":"European Steel and Coal Community, the Asian Development Bank and the Inter-American","page_number":348,"box":{"x":117,"y":118,"width":683,"height":12}},{"id":"417bf8da-1a52-4901-8d72-8aac66885bff","block_type":"box","text":"Development Bank. The government members, or “stockholders,” usually make initial capital","page_number":348,"box":{"x":117,"y":134,"width":691,"height":12}},{"id":"2df3ca60-3b0a-406b-bc67-cdcbc73d340f","block_type":"box","text":"contributions to the supranational entity and in many cases are committed to make additional capital","page_number":348,"box":{"x":116,"y":149,"width":748,"height":12}},{"id":"53b11b7a-2689-42fe-8b34-f668f20597ca","block_type":"box","text":"contributions if the supranational entity is unable to repay its borrowings. There is no guarantee that","page_number":348,"box":{"x":116,"y":165,"width":744,"height":12}},{"id":"cd119edb-af54-4bfd-baeb-7cc87a4eae4d","block_type":"box","text":"one or more stockholders of a supranational entity will continue to make any necessary additional","page_number":348,"box":{"x":116,"y":180,"width":729,"height":12}},{"id":"e13040c1-0208-479d-8512-8536c8479bbd","block_type":"box","text":"capital contributions. If such contributions are not made, the entity may be unable to pay interest or","page_number":348,"box":{"x":116,"y":196,"width":739,"height":12}},{"id":"58d9ca0d-0e8a-4319-8f06-77e86fa081fb","block_type":"box","text":"repay principal on its debt securities, and a Fund may lose money on such investments.","page_number":348,"box":{"x":117,"y":211,"width":655,"height":12}},{"id":"0d4c5996-4200-4bcb-8e9d-c14131a77588","block_type":"box","text":"Depositary Receipts (ADRs, EDRs and GDRs).","page_number":348,"box":{"x":116,"y":244,"width":367,"height":12}},{"id":"381ec1e5-2cf5-4a7b-bd8f-9fb1e760aa9b","block_type":"box","text":"Certain Funds may invest in the securities of foreign","page_number":348,"box":{"x":484,"y":244,"width":397,"height":12}},{"id":"a133e6ca-0d27-4516-826b-e3de44acbebe","block_type":"box","text":"issuers in the form of Depositary Receipts or other securities convertible into securities of foreign","page_number":348,"box":{"x":117,"y":260,"width":722,"height":12}},{"id":"d8d883d2-0bb8-4b5e-b851-6453a69d66c5","block_type":"box","text":"issuers. Depositary Receipts may not necessarily be denominated in the same currency as the","page_number":348,"box":{"x":117,"y":275,"width":707,"height":12}},{"id":"e5058fa6-3e52-4f44-a853-90dab39072d6","block_type":"box","text":"underlying securities into which they may be converted. The Fund may invest in both sponsored and","page_number":348,"box":{"x":117,"y":291,"width":749,"height":12}},{"id":"31cce287-c21e-4839-958f-518fd2c35c6d","block_type":"box","text":"unsponsored American Depositary Receipts (“ADRs”), European Depositary Receipts (“EDRs”), Global","page_number":348,"box":{"x":117,"y":306,"width":769,"height":12}},{"id":"7604e25b-916f-4f36-bdb1-47bdeae74db1","block_type":"box","text":"Depositary Receipts (“GDRs”) and other similar global instruments. ADRs typically are issued by an","page_number":348,"box":{"x":117,"y":322,"width":743,"height":12}},{"id":"d884b074-1834-42ec-bb48-0749a5589c05","block_type":"box","text":"American bank or trust company and evidence ownership of underlying securities issued by a foreign","page_number":348,"box":{"x":116,"y":337,"width":756,"height":12}},{"id":"5fde530d-c4e1-4421-bb6f-4baceca977ba","block_type":"box","text":"corporation. EDRs, which are sometimes referred to as Continental Depositary Receipts, are receipts","page_number":348,"box":{"x":116,"y":353,"width":757,"height":12}},{"id":"aaf6d79a-dd19-4fa0-b8de-3337631b262f","block_type":"box","text":"issued in Europe, typically by foreign banks and trust companies, that evidence ownership of either","page_number":348,"box":{"x":117,"y":368,"width":739,"height":12}},{"id":"0b7f40f5-25bf-4323-a920-ba96c4f6453f","block_type":"box","text":"foreign or domestic underlying securities. GDRs are depositary receipts structured like global debt","page_number":348,"box":{"x":116,"y":384,"width":732,"height":12}},{"id":"e8c6e7fd-b935-45c3-992e-b2aeb6f0866a","block_type":"box","text":"issues to facilitate trading on an international basis. In addition to investment risks associated with the","page_number":348,"box":{"x":117,"y":399,"width":758,"height":12}},{"id":"85be70b3-bee7-4558-af42-284ec0287fe7","block_type":"box","text":"underlying issuer, Depositary Receipts expose a Fund to additional risks associated with the","page_number":348,"box":{"x":117,"y":415,"width":689,"height":12}},{"id":"dc3f2764-d3d0-4f2f-b149-4ee39a174dd8","block_type":"box","text":"non-uniform terms that apply to Depositary Receipt programs, credit exposure to the depository bank","page_number":348,"box":{"x":117,"y":430,"width":754,"height":12}},{"id":"d3b325df-e0c3-4ad9-9063-9271f1f25967","block_type":"box","text":"and to the sponsors and other parties with whom the depository bank establishes the programs,","page_number":348,"box":{"x":116,"y":446,"width":716,"height":12}},{"id":"7695e18a-4141-4433-b546-3fcaa305ca90","block_type":"box","text":"currency risk and the risk of an illiquid market for Depositary Receipts. Unsponsored ADR, EDR and","page_number":348,"box":{"x":116,"y":461,"width":748,"height":12}},{"id":"6937ece3-7ac8-43f9-9d08-016320332a87","block_type":"box","text":"GDR programs are organized independently and without the cooperation of the issuer of the underlying","page_number":348,"box":{"x":117,"y":477,"width":771,"height":12}},{"id":"aa557899-8d35-45ff-90be-de92883fd97b","block_type":"box","text":"securities. Unsponsored programs generally expose investors to greater risks than sponsored","page_number":348,"box":{"x":116,"y":492,"width":701,"height":12}},{"id":"fc173e19-4a98-4826-8eac-a02406f0a8ca","block_type":"box","text":"programs and do not provide holders with many of the shareholder benefits that come from investing in","page_number":348,"box":{"x":117,"y":508,"width":769,"height":12}},{"id":"71be128b-2c0a-4e32-81ad-9f7ce87d4628","block_type":"box","text":"a sponsored Depositary Receipt. Available information concerning the issuer may not be as current as","page_number":348,"box":{"x":116,"y":523,"width":764,"height":12}},{"id":"670b0dd3-d438-4c5f-9be1-fe960e340d75","block_type":"box","text":"for sponsored ADRs, EDRs and GDRs, and the prices of unsponsored ADRs, EDRs and GDRs may","page_number":348,"box":{"x":116,"y":539,"width":750,"height":12}},{"id":"7f1ce90e-9e6b-4daa-bc96-ec507f57e88a","block_type":"box","text":"be more volatile than if such instruments were sponsored by the issuer. Depositary Receipts are","page_number":348,"box":{"x":117,"y":554,"width":718,"height":12}},{"id":"ac50dbfd-64ae-4a24-8f31-9ad7da74050f","block_type":"box","text":"generally subject to the same risks as the foreign securities that they evidence or into which they may","page_number":348,"box":{"x":116,"y":570,"width":759,"height":12}},{"id":"c43b25c8-3020-49bc-ae28-d110d89bfc12","block_type":"box","text":"be converted. Investments in ADRs, EDRs and GDRs present additional investment considerations as","page_number":348,"box":{"x":117,"y":585,"width":763,"height":12}},{"id":"328f1d27-f5c8-4d74-b29f-f309dd2de102","block_type":"box","text":"described under “Foreign Investment Risks.”","page_number":348,"box":{"x":116,"y":601,"width":336,"height":12}},{"id":"841dfaf1-6715-4bae-a07b-46d92aed289c","block_type":"box","text":"Derivatives.","page_number":348,"box":{"x":116,"y":634,"width":99,"height":10}},{"id":"46dded65-6678-450d-94fd-e790ffa0dc37","block_type":"box","text":"General.","page_number":348,"box":{"x":117,"y":658,"width":68,"height":10}},{"id":"d5ee50da-f7dc-4498-9889-69be0b9854c3","block_type":"box","text":"Each Fund may use instruments referred to as derivatives, which are financial instruments","page_number":348,"box":{"x":186,"y":658,"width":675,"height":12}},{"id":"ba607532-eb9d-4b62-9aab-f2842b345a6f","block_type":"box","text":"that derive their value from one or more securities, commodities (such as gold or oil), currencies","page_number":348,"box":{"x":116,"y":674,"width":712,"height":12}},{"id":"a13d2bc6-f1a5-4a10-9efc-d2c416f2389f","block_type":"box","text":"(including bitcoin and ether), interest rates, credit events or indices (a measure of value or rates, such","page_number":348,"box":{"x":117,"y":689,"width":753,"height":12}},{"id":"f7c50bd8-fd0c-403b-b167-4b3a3de4f25c","block_type":"box","text":"as the S&P 500 Index or the prime lending rate) or other reference asset. Derivatives may allow a","page_number":348,"box":{"x":116,"y":705,"width":724,"height":12}},{"id":"b2a1d739-eb32-44e2-9f13-be6a62beb325","block_type":"box","text":"Fund to increase or decrease the level of risk to which the Fund is exposed more quickly and efficiently","page_number":348,"box":{"x":117,"y":720,"width":764,"height":12}},{"id":"4c1e1947-d203-4721-a71c-98708bbef19c","block_type":"box","text":"than with other transactions. Certain Funds may use derivatives to maintain a portion of their long and","page_number":348,"box":{"x":116,"y":736,"width":756,"height":12}},{"id":"941a55b7-aaca-4332-958f-9ae4f25c6e73","block_type":"box","text":"short positions. Unless otherwise permitted, no Fund may use derivatives to gain exposure to an asset","page_number":348,"box":{"x":116,"y":752,"width":761,"height":12}},{"id":"f9da6e2f-3373-4630-83c6-4e09397c9cf8","block_type":"box","text":"or asset class it is prohibited by its investment restrictions from purchasing directly. As described","page_number":348,"box":{"x":116,"y":767,"width":716,"height":12}},{"id":"e71d472a-f4b8-44e4-9f94-ef24c7557ae2","block_type":"box","text":"below, derivatives can be used for hedging or speculative purposes. Funds will engage in transaction","page_number":348,"box":{"x":117,"y":782,"width":755,"height":13}},{"id":"701ce4c5-b2e7-4e34-9f1c-e276571d0dc4","block_type":"box","text":"level payment netting,","page_number":348,"box":{"x":117,"y":798,"width":161,"height":12}},{"id":"f917355a-6a20-4dc5-8955-85cfb73b6af4","block_type":"box","text":"i.e.","page_number":348,"box":{"x":285,"y":798,"width":20,"height":9}},{"id":"cadcab28-f16e-4416-a2f0-db8b06a19761","block_type":"box","text":", the payment obligations of derivatives contracts are netted against one","page_number":348,"box":{"x":308,"y":798,"width":534,"height":12}},{"id":"9daaf6ba-65c9-4605-8fd2-863db202cfca","block_type":"box","text":"another with the Fund receiving or paying, as the case may be, only the net amount of the two","page_number":348,"box":{"x":116,"y":813,"width":698,"height":13}},{"id":"bceb43d2-100d-4929-b49d-6610c01fdaed","block_type":"box","text":"payment streams.","page_number":348,"box":{"x":117,"y":829,"width":137,"height":12}},{"id":"76a1bb1a-e3a4-4c64-9f79-da996c4942b0","block_type":"box","text":"Hedging.","page_number":348,"box":{"x":116,"y":862,"width":72,"height":12}},{"id":"b1b2aee2-7584-41ef-873a-a38a415a5964","block_type":"box","text":"Each Fund may use derivatives for hedging purposes, in which a derivative is used to offset","page_number":348,"box":{"x":189,"y":862,"width":684,"height":12}},{"id":"61f64f4e-6f57-498d-b9bd-30b845741dae","block_type":"box","text":"the risks associated with other Fund holdings. Losses on other investments may be substantially","page_number":348,"box":{"x":116,"y":878,"width":721,"height":12}},{"id":"6bd3b197-93d2-4a9f-b036-41ceb56e4644","block_type":"box","text":"II-16","page_number":348,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"8d0b3464-8644-4f97-8320-9f41e5bf002c","block_type":"box","text":"NM1026U-6004382-348/605","page_number":348,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"68944db3-366d-4e18-a629-7c2d2c010d65","block_type":"box","text":"reduced by gains on a derivative that reacts in an opposite manner to market movements. Although","page_number":349,"box":{"x":117,"y":87,"width":743,"height":12}},{"id":"c18af846-878b-464f-b497-d1e1d5134b65","block_type":"box","text":"hedging may reduce losses, it may also reduce or eliminate gains. In addition, hedging may cause","page_number":349,"box":{"x":117,"y":103,"width":733,"height":12}},{"id":"a7921835-b40a-4ca9-9d7e-5a2842d37872","block_type":"box","text":"losses if the market moves in an unanticipated manner, or if the cost of the derivative outweighs the","page_number":349,"box":{"x":117,"y":118,"width":744,"height":12}},{"id":"2fcf21c1-edc3-411f-a5e8-2cda6762d438","block_type":"box","text":"benefit of the hedge. The effectiveness of hedging may be reduced by correlation risk,","page_number":349,"box":{"x":117,"y":134,"width":643,"height":12}},{"id":"c0b4405b-6788-4e16-b9c7-efa5076abe8b","block_type":"box","text":"i.e.","page_number":349,"box":{"x":761,"y":134,"width":20,"height":9}},{"id":"03d38f58-1585-4aeb-ad83-3c7bcd713f94","block_type":"box","text":",","page_number":349,"box":{"x":784,"y":142,"width":2,"height":3}},{"id":"92e16bba-e89f-4f75-98b2-c9367def87e5","block_type":"box","text":"the risk that","page_number":349,"box":{"x":793,"y":134,"width":91,"height":9}},{"id":"8574413d-3d06-452f-9be9-855ee3132d79","block_type":"box","text":"changes in the value of the derivative will not match those of the holdings being hedged as expected","page_number":349,"box":{"x":116,"y":149,"width":751,"height":12}},{"id":"90694d84-f9bc-4b6c-a764-0a996e092dbd","block_type":"box","text":"by a Fund, which may result in additional losses to the Fund. The inability to close or offset derivatives","page_number":349,"box":{"x":117,"y":165,"width":762,"height":12}},{"id":"8701bced-ec40-48cb-bfb0-90585842dbca","block_type":"box","text":"could also reduce the effectiveness of a Fund’s hedging. There is no assurance that a Fund’s hedging","page_number":349,"box":{"x":116,"y":180,"width":762,"height":12}},{"id":"dc33ab4b-db42-4ce3-9340-9ea85e6b0d97","block_type":"box","text":"will be effective. No Fund is required to use derivatives to hedge.","page_number":349,"box":{"x":116,"y":196,"width":486,"height":12}},{"id":"1aa9f641-9e6e-4513-8d80-bf0373cbc620","block_type":"box","text":"Speculation.","page_number":349,"box":{"x":117,"y":227,"width":90,"height":11}},{"id":"093b0bc4-7f8b-4a91-8d65-340001d023a1","block_type":"box","text":"Certain Funds may also use derivatives for speculative purposes to seek to enhance","page_number":349,"box":{"x":208,"y":227,"width":638,"height":12}},{"id":"636795ae-5048-4447-8b7c-06ebbf994493","block_type":"box","text":"returns. The use of a derivative is speculative if the Fund is primarily seeking to achieve gains, rather","page_number":349,"box":{"x":117,"y":242,"width":753,"height":12}},{"id":"1115df05-b753-4c9b-9d07-f804f44d0107","block_type":"box","text":"than offset the risk of other positions. To the extent a Fund invests in a derivative for speculative","page_number":349,"box":{"x":116,"y":258,"width":719,"height":11}},{"id":"315d90ff-23c4-4d44-9b41-d1d8676aa6b1","block_type":"box","text":"purposes, the Fund will be fully exposed to the risks of loss of that derivative, which may sometimes be","page_number":349,"box":{"x":117,"y":273,"width":769,"height":12}},{"id":"23fc67ab-7b71-40b1-9ef4-fae5507fa19a","block_type":"box","text":"greater than the derivative’s cost, and the potential for loss in certain cases may be unlimited.","page_number":349,"box":{"x":116,"y":289,"width":699,"height":12}},{"id":"78fc3638-6523-4072-a3e3-b0ddb1bd8536","block_type":"box","text":"Regulation of Derivatives.","page_number":349,"box":{"x":116,"y":327,"width":196,"height":12}},{"id":"5ba5b628-2d37-4141-8f8b-a6b4850fdfb8","block_type":"box","text":"Rule 18f-4 Under the Investment Company Act.","page_number":349,"box":{"x":116,"y":351,"width":352,"height":12}},{"id":"8aa3d6be-1a2e-4bb4-853b-6f18b7f8d106","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits","page_number":349,"box":{"x":469,"y":351,"width":416,"height":12}},{"id":"eea621f9-07b7-4ca6-99bc-d6c53f0608c5","block_type":"box","text":"a Fund to enter into Derivatives Transactions (as defined below) and certain other transactions","page_number":349,"box":{"x":116,"y":366,"width":708,"height":12}},{"id":"d0f0bc2a-6047-4cb8-a7b1-10a514af3f07","block_type":"box","text":"notwithstanding the restrictions on the issuance of “senior securities” under Section 18 of the","page_number":349,"box":{"x":117,"y":382,"width":692,"height":12}},{"id":"0c195d49-c476-4576-8482-72e2a01222f2","block_type":"box","text":"Investment Company Act. Section 18 of the Investment Company Act, among other things, prohibits","page_number":349,"box":{"x":117,"y":397,"width":747,"height":12}},{"id":"e460c71e-b8b5-4047-bfac-03d3ef47993c","block_type":"box","text":"open-end funds, including the Funds, from issuing or selling any “senior security,” other than borrowing","page_number":349,"box":{"x":116,"y":413,"width":769,"height":12}},{"id":"f993811d-2c92-4cea-a59d-c22fc6fbebe0","block_type":"box","text":"from a bank (subject to a requirement to maintain 300% “asset coverage”).","page_number":349,"box":{"x":116,"y":428,"width":560,"height":12}},{"id":"b1ef1a6e-faa6-4f45-97a6-db362f73c8b0","block_type":"box","text":"Under Rule 18f-4, “Derivatives Transactions” include the following: (1) any swap, security-based swap","page_number":349,"box":{"x":117,"y":459,"width":761,"height":12}},{"id":"ecfe1b09-caa1-47cc-803c-5c5fe9ece6d6","block_type":"box","text":"(including a contract for differences), futures contract, forward contract, option (excluding purchased","page_number":349,"box":{"x":117,"y":475,"width":747,"height":12}},{"id":"37c79951-e463-44bc-9497-ebb20402feda","block_type":"box","text":"options), any combination of the foregoing, or any similar instrument, under which a Fund is or may be","page_number":349,"box":{"x":116,"y":490,"width":764,"height":12}},{"id":"f2b5119d-e873-4cc6-b405-5bc1c3a5309a","block_type":"box","text":"required to make any payment or delivery of cash or other assets during the life of the instrument or at","page_number":349,"box":{"x":117,"y":506,"width":763,"height":12}},{"id":"217b4d0c-f39d-4b36-bad4-7a6d5bf73e02","block_type":"box","text":"maturity or early termination, whether as margin or settlement payment or otherwise; (2) any short sale","page_number":349,"box":{"x":117,"y":521,"width":767,"height":12}},{"id":"90f60d3f-9051-4073-8c6a-ee6dfafb2fa6","block_type":"box","text":"borrowing; (3) reverse repurchase agreements and similar financing transactions (e.g., recourse and","page_number":349,"box":{"x":117,"y":537,"width":750,"height":12}},{"id":"316e659b-7356-48ef-8f54-a09cbf279cd6","block_type":"box","text":"non-recourse tender option bonds, and borrowed bonds), if a Fund elects to treat all of these","page_number":349,"box":{"x":117,"y":552,"width":691,"height":12}},{"id":"9ea8b522-cbe3-423b-94df-0619f091d3be","block_type":"box","text":"transactions as Derivatives Transactions under Rule 18f-4; and (4) when-issued or forward-settling","page_number":349,"box":{"x":116,"y":568,"width":738,"height":12}},{"id":"c9fa107a-86a9-4129-9841-7a1e34eba4b6","block_type":"box","text":"securities (e.g., firm and standby commitments, including to-be-announced (“TBA”) commitments, and","page_number":349,"box":{"x":116,"y":583,"width":763,"height":12}},{"id":"53ac6ddd-71d7-4436-8fd0-5dff7d518f3e","block_type":"box","text":"dollar rolls) and non-standard settlement cycle securities, unless such transactions meet the Delayed","page_number":349,"box":{"x":116,"y":599,"width":755,"height":12}},{"id":"90539b0a-1df7-443c-b26a-60cc0e9ad41d","block_type":"box","text":"Settlement Securities Provision (as defined below under “— When-Issued Securities, Delayed Delivery","page_number":349,"box":{"x":116,"y":614,"width":768,"height":12}},{"id":"7f2a81b1-3a7f-4317-8fc3-5fbb510202f6","block_type":"box","text":"Securities and Forward Commitments”).","page_number":349,"box":{"x":116,"y":630,"width":302,"height":12}},{"id":"6e7bbb12-b6d0-4a56-858d-e4eda5cd8c72","block_type":"box","text":"Unless a Fund is relying on the Limited Derivatives User Exception (as defined below), the Fund must","page_number":349,"box":{"x":117,"y":661,"width":754,"height":12}},{"id":"b7f1d3e6-6896-4130-92e9-9d76bb81e76e","block_type":"box","text":"comply with Rule 18f-4 with respect to its Derivatives Transactions. Rule 18f-4, among other things,","page_number":349,"box":{"x":116,"y":676,"width":737,"height":12}},{"id":"22d2b1cf-1774-4b66-93b3-3b01a0cd59a4","block_type":"box","text":"requires a Fund to adopt and implement a comprehensive written derivatives risk management","page_number":349,"box":{"x":117,"y":692,"width":703,"height":12}},{"id":"3fea5ce5-4709-424a-984f-014a03f3584d","block_type":"box","text":"program (“DRMP”) and comply with a relative or absolute limit on Fund leverage risk calculated based","page_number":349,"box":{"x":117,"y":707,"width":755,"height":12}},{"id":"55f569cc-bf18-4266-9ffa-2e752fc8aa0d","block_type":"box","text":"on value-at-risk (“VaR”). The DRMP is administered by a “derivatives risk manager,” who is appointed","page_number":349,"box":{"x":116,"y":723,"width":755,"height":12}},{"id":"2fbf4ede-8a22-497b-8aa6-1304825e2ae4","block_type":"box","text":"by the Fund’s Board, including a majority of the independent Directors, and periodically reviews the","page_number":349,"box":{"x":117,"y":738,"width":734,"height":12}},{"id":"e115175e-50c1-498c-81f7-ba1dcfaf24f7","block_type":"box","text":"DRMP and reports to the Fund’s Board.","page_number":349,"box":{"x":117,"y":754,"width":293,"height":12}},{"id":"aab4c703-9793-4cab-b834-ecf01a7be292","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":349,"box":{"x":117,"y":785,"width":758,"height":12}},{"id":"3bc234a5-7e52-4bf6-9a16-6c08cf065701","block_type":"box","text":"“derivatives exposure” is limited to 10% of its net assets (as calculated in accordance with Rule 18f-4)","page_number":349,"box":{"x":116,"y":800,"width":754,"height":12}},{"id":"2613d96d-703e-4527-b525-83245a21649e","block_type":"box","text":"and the Fund adopts and implements written policies and procedures reasonably designed to manage","page_number":349,"box":{"x":116,"y":816,"width":758,"height":12}},{"id":"82724d26-5061-45cd-a1ce-eae0b26fc126","block_type":"box","text":"its derivatives risks (the “Limited Derivatives User Exception”).","page_number":349,"box":{"x":117,"y":831,"width":466,"height":12}},{"id":"fee1d471-26b6-4321-b007-3a8ea4c52dcc","block_type":"box","text":"Dodd-Frank Regulations.","page_number":349,"box":{"x":116,"y":862,"width":185,"height":12}},{"id":"2e4482f5-8749-40ad-9114-277644f9c7a6","block_type":"box","text":"The Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd","page_number":349,"box":{"x":303,"y":862,"width":560,"height":12}},{"id":"6d968c1d-7d8d-45a5-9c61-64906465cbea","block_type":"box","text":"Frank”), enacted in July 2010, includes provisions that comprehensively regulate the over-the-counter","page_number":349,"box":{"x":117,"y":878,"width":758,"height":12}},{"id":"95fa8cd5-7034-4e75-9649-cffdd2415e1e","block_type":"box","text":"II-17","page_number":349,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"ef273685-cc5a-4558-978a-2f159354be22","block_type":"box","text":"NM1026U-6004382-349/605","page_number":349,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"de11e38d-6ee4-4291-966b-f558ff0cff90","block_type":"box","text":"(“OTC”) derivatives markets for the first time. While the Commodity Futures Trading Commission","page_number":350,"box":{"x":117,"y":87,"width":722,"height":12}},{"id":"896845ca-c8a8-4a16-82b6-cafd448e1537","block_type":"box","text":"(“CFTC”) and other U.S. regulators have adopted many of the required Dodd-Frank regulations, certain","page_number":350,"box":{"x":117,"y":102,"width":770,"height":13}},{"id":"2c92e77b-19ce-495c-9a4f-a747aa4a2fe6","block_type":"box","text":"regulations have only recently become effective and other regulations remain to be adopted. The full","page_number":350,"box":{"x":117,"y":118,"width":749,"height":12}},{"id":"7a9909c1-7449-47ba-828d-f56d5798a198","block_type":"box","text":"impact of Dodd-Frank on the Funds remains uncertain.","page_number":350,"box":{"x":117,"y":134,"width":411,"height":11}},{"id":"8cb4e0e4-4026-4319-90b9-c83322daad6f","block_type":"box","text":"Many OTC derivatives dealers are required to register with the CFTC as “swap dealers” and/or with the","page_number":350,"box":{"x":117,"y":165,"width":770,"height":12}},{"id":"80dee2b9-826c-45f6-879b-951a3d882ed7","block_type":"box","text":"SEC as “security-based swap dealers”. Registered swap dealers","page_number":350,"box":{"x":116,"y":180,"width":480,"height":12}},{"id":"bbd121d1-7b93-4313-8ae6-d78ec3cbdefb","block_type":"box","text":"and security-based swap dealers are","page_number":350,"box":{"x":596,"y":180,"width":285,"height":12}},{"id":"e4b9111e-713a-474e-ae29-976808dab745","block_type":"box","text":"subject to various regulatory requirements, including, but not limited to, margin, recordkeeping,","page_number":350,"box":{"x":116,"y":196,"width":708,"height":12}},{"id":"244ffbb0-625f-4b88-b858-f2ad9ce315a4","block_type":"box","text":"reporting, transparency, position limits, limitations on conflicts of interest, business conduct standards,","page_number":350,"box":{"x":117,"y":211,"width":761,"height":12}},{"id":"300dd8f1-fb5c-4634-b99f-dd36c478482c","block_type":"box","text":"minimum capital requirements and other regulatory requirements, which indirectly impact the Funds","page_number":350,"box":{"x":117,"y":227,"width":743,"height":12}},{"id":"e793c616-1bfb-4810-9bad-7787efa9385c","block_type":"box","text":"that enter into transactions with them.","page_number":350,"box":{"x":116,"y":242,"width":284,"height":10}},{"id":"87621118-4cf2-4a20-a1d6-a5225181fd79","block_type":"box","text":"The CFTC requires that certain interest rate swaps and certain credit default swaps must be executed","page_number":350,"box":{"x":116,"y":273,"width":761,"height":12}},{"id":"b8886676-f276-49d4-85df-56c37f4615f9","block_type":"box","text":"in regulated markets and be submitted for clearing to regulated clearinghouses. The SEC is also","page_number":350,"box":{"x":117,"y":289,"width":719,"height":12}},{"id":"5bdc0a7d-612f-4de8-b755-d88126011c8b","block_type":"box","text":"expected to impose similar requirements on certain security-based derivatives in the future. OTC","page_number":350,"box":{"x":116,"y":304,"width":723,"height":12}},{"id":"cc243aae-ab3e-40b1-9c4d-dbcfb9f5c00d","block_type":"box","text":"derivatives trades submitted for clearing are subject to minimum initial and variation margin","page_number":350,"box":{"x":116,"y":320,"width":681,"height":12}},{"id":"49bb197f-db09-4537-9fe7-67191bf385fd","block_type":"box","text":"requirements set by the relevant clearinghouse, as well as margin requirements mandated by the","page_number":350,"box":{"x":117,"y":335,"width":726,"height":12}},{"id":"06d2ea5c-8ddf-456a-b46c-1e5e98422b6c","block_type":"box","text":"CFTC, SEC and/or federal prudential regulators. In addition, futures commission merchants (“FCMs”),","page_number":350,"box":{"x":117,"y":351,"width":760,"height":12}},{"id":"58dd09a4-d5d3-4186-a773-a56297409835","block_type":"box","text":"who act as clearing members on behalf of customers for cleared OTC derivatives and futures","page_number":350,"box":{"x":116,"y":366,"width":697,"height":12}},{"id":"8198f58b-0763-4147-93cb-f32683c830f1","block_type":"box","text":"contracts, also have discretion to increase a Fund’s margin requirements for these transactions beyond","page_number":350,"box":{"x":116,"y":382,"width":772,"height":12}},{"id":"29d05a9e-3e18-4408-ba0a-ec935de9e790","block_type":"box","text":"any regulatory and clearinghouse minimums subject to any restrictions on such discretion in the","page_number":350,"box":{"x":116,"y":397,"width":715,"height":12}},{"id":"8eb10d89-161d-4985-9c0b-6405dfb77f72","block_type":"box","text":"documentation between the FCM and the customer. These regulatory requirements may make it more","page_number":350,"box":{"x":116,"y":413,"width":764,"height":12}},{"id":"c076c93e-3fc3-4aa5-893d-57f95dfd8d2b","block_type":"box","text":"difficult and costly for the Funds to enter into highly tailored or customized transactions, potentially","page_number":350,"box":{"x":116,"y":428,"width":733,"height":12}},{"id":"24074be7-a698-4e4a-b6e9-433acf7a064d","block_type":"box","text":"rendering certain investment strategies impossible or not economically feasible. If a Fund decides to","page_number":350,"box":{"x":117,"y":444,"width":747,"height":12}},{"id":"4825f38b-9e59-4156-84ed-2c706676e266","block_type":"box","text":"execute and clear cleared OTC derivatives and/or futures contracts through execution facilities,","page_number":350,"box":{"x":116,"y":459,"width":712,"height":12}},{"id":"77344d02-98e9-4617-a86f-1a8f55e30095","block_type":"box","text":"exchanges or clearinghouses, either indirectly through an executing broker, clearing member FCM or","page_number":350,"box":{"x":116,"y":475,"width":756,"height":12}},{"id":"a1da1bad-9089-447b-9af7-098f1a33b1a1","block_type":"box","text":"as a direct member, a Fund would be required to comply with the rules of the execution facility,","page_number":350,"box":{"x":116,"y":490,"width":709,"height":12}},{"id":"0f217d0e-7b22-430d-b760-baca9c46dee4","block_type":"box","text":"exchange or clearinghouse and other applicable law.","page_number":350,"box":{"x":116,"y":506,"width":397,"height":12}},{"id":"a0700669-e225-4f5d-bede-fb00307bc67b","block_type":"box","text":"With respect to cleared OTC derivatives and futures contracts and options on futures, a Fund will not","page_number":350,"box":{"x":116,"y":537,"width":753,"height":12}},{"id":"8e1a12f1-1c3a-4581-bbca-3e2d120a27b0","block_type":"box","text":"face a clearinghouse directly but rather will do so through a FCM that is registered with the CFTC and/","page_number":350,"box":{"x":116,"y":552,"width":759,"height":12}},{"id":"c7d8a4b8-f9b6-477d-b2e8-ca534cd8482b","block_type":"box","text":"or SEC and that acts as a clearing member. A Fund may face the indirect risk of the failure of another","page_number":350,"box":{"x":116,"y":568,"width":759,"height":12}},{"id":"bbf235b4-44a3-4aa3-8e01-d43e431d247c","block_type":"box","text":"clearing member customer to meet its obligations to its clearing member. Such scenario could arise","page_number":350,"box":{"x":116,"y":583,"width":744,"height":12}},{"id":"13648423-9537-4da6-adf7-93639d537910","block_type":"box","text":"due to a default by the clearing member on its obligations to the clearinghouse simultaneously with a","page_number":350,"box":{"x":116,"y":599,"width":752,"height":12}},{"id":"b8f24edd-a9aa-4016-a536-00da13839008","block_type":"box","text":"customer’s failure to meet its obligations to the clearing member.","page_number":350,"box":{"x":116,"y":614,"width":485,"height":12}},{"id":"cfb675e2-60bb-4612-9843-552873ce4760","block_type":"box","text":"Clearing member FCMs are required to post initial margin to the clearinghouses through which they","page_number":350,"box":{"x":117,"y":645,"width":742,"height":12}},{"id":"5fdb65de-2494-4e4a-a29e-bdd64afe0c4c","block_type":"box","text":"clear their customers’ cleared OTC derivatives and futures contracts, instead of using such initial","page_number":350,"box":{"x":116,"y":661,"width":716,"height":12}},{"id":"e99146b1-c9d0-40a5-baf0-b3b1a0d4abb8","block_type":"box","text":"margin in their businesses, as was widely permitted for OTC derivatives before Dodd-Frank. While an","page_number":350,"box":{"x":117,"y":676,"width":752,"height":12}},{"id":"38def95d-db83-4589-ab45-86af93be61f8","block_type":"box","text":"FCM may require its customer to post initial margin in excess of clearinghouse requirements, and","page_number":350,"box":{"x":117,"y":692,"width":721,"height":12}},{"id":"13b1c5a6-20a5-4fc2-834f-c6e1c10c6868","block_type":"box","text":"certain clearinghouses may share a portion of their earnings on initial margin with their clearing","page_number":350,"box":{"x":116,"y":707,"width":704,"height":12}},{"id":"a2f29f1b-d8ed-4d70-9cb1-c7114247275c","block_type":"box","text":"members, some portion of the initial margin that is passed through to the clearinghouse does not","page_number":350,"box":{"x":117,"y":723,"width":717,"height":12}},{"id":"66fee69f-7339-4aa0-aa1c-aef1633c73d2","block_type":"box","text":"generate earnings for the FCM. The inability of FCMs to earn the same levels of returns on initial","page_number":350,"box":{"x":116,"y":738,"width":716,"height":12}},{"id":"64ee54bc-a85b-4881-9d51-05669fd1b432","block_type":"box","text":"margin for cleared OTC derivatives as they could earn with respect to non-cleared OTC derivatives","page_number":350,"box":{"x":117,"y":754,"width":734,"height":12}},{"id":"2b59aeca-03bb-4a90-b1b7-e85bc64d0a57","block_type":"box","text":"may cause FCMs to charge higher fees, or provide less favorable pricing on cleared OTC derivatives","page_number":350,"box":{"x":117,"y":769,"width":747,"height":12}},{"id":"7d3ba985-899a-4886-b95d-c893a8d16d6c","block_type":"box","text":"than swap dealers will provide for non-cleared OTC derivatives. Furthermore, customers, including the","page_number":350,"box":{"x":116,"y":785,"width":760,"height":12}},{"id":"b76163e2-823b-4114-b74b-ed8d7d6a6505","block_type":"box","text":"Funds, are subject to additional fees payable to FCMs with respect to cleared OTC derivatives, which","page_number":350,"box":{"x":117,"y":800,"width":751,"height":12}},{"id":"bf678e4c-e486-4e7b-a8ca-916ea6214837","block_type":"box","text":"may raise the cost to Funds of clearing as compared to trading non-cleared OTC derivatives bilaterally.","page_number":350,"box":{"x":117,"y":816,"width":763,"height":12}},{"id":"10579493-ffaa-4ebb-a3a6-ef85c45b77cc","block_type":"box","text":"With respect to uncleared swaps, registered swap dealers and security-based swap dealers are","page_number":350,"box":{"x":116,"y":847,"width":715,"height":12}},{"id":"43f1293c-7ab8-4e1b-aaea-9808c80b541d","block_type":"box","text":"required to exchange variation margin with a Fund and may be required by applicable regulations to","page_number":350,"box":{"x":117,"y":862,"width":745,"height":12}},{"id":"a2c93764-d720-4b4a-aec2-2a4b27c44801","block_type":"box","text":"collect (and in some cases exchange) initial margin with a Fund. Both initial and variation margin may","page_number":350,"box":{"x":116,"y":878,"width":757,"height":12}},{"id":"064728fe-df94-44a9-b82d-e550e593aabb","block_type":"box","text":"II-18","page_number":350,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"186714fb-d669-4ce2-a7bd-6f7dd262c040","block_type":"box","text":"NM1026U-6004382-350/605","page_number":350,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"61e0409a-aa78-4e0f-84e8-ee20cd444ef4","block_type":"box","text":"be comprised of cash and/or securities, subject to applicable regulatory haircuts and other restrictions.","page_number":351,"box":{"x":117,"y":87,"width":763,"height":12}},{"id":"771e52d3-4707-4304-9bb0-3a5a9441b136","block_type":"box","text":"Shares of investment companies (other than certain money market funds) may not be posted as","page_number":351,"box":{"x":116,"y":102,"width":719,"height":13}},{"id":"57ebee61-edc2-4852-9f12-f2ca5e27bb59","block_type":"box","text":"collateral under applicable regulations.","page_number":351,"box":{"x":116,"y":118,"width":291,"height":12}},{"id":"7ffe3c7f-0b39-46a1-b2a4-8ce5dba773a6","block_type":"box","text":"The CFTC, certain foreign regulators, and many futures exchanges have established (and continue to","page_number":351,"box":{"x":116,"y":149,"width":760,"height":12}},{"id":"3486c06b-fcb0-4d77-997f-383785330d3b","block_type":"box","text":"evaluate and monitor) speculative position limits (“position limits”) on the maximum speculative position","page_number":351,"box":{"x":116,"y":165,"width":771,"height":12}},{"id":"51537ba3-6ae5-4aa7-be0c-e07e1867660e","block_type":"box","text":"which any person, or group of persons acting in concert, may hold or control in particular contracts. In","page_number":351,"box":{"x":116,"y":180,"width":759,"height":12}},{"id":"139c855d-f692-4a08-b000-542a44b9011e","block_type":"box","text":"addition, U.S. federal position limits apply to swaps that are economically equivalent to futures","page_number":351,"box":{"x":116,"y":196,"width":703,"height":12}},{"id":"4bb5cb18-3a0d-49f1-8f80-24b190d59c8f","block_type":"box","text":"contracts on certain agricultural, metals and energy commodities. All positions owned or controlled by","page_number":351,"box":{"x":116,"y":211,"width":758,"height":12}},{"id":"6fc7dd3d-5da4-4cbe-abfb-7be225f2fad5","block_type":"box","text":"the same person or entity, even if in different accounts, must be aggregated for purposes of complying","page_number":351,"box":{"x":116,"y":227,"width":766,"height":12}},{"id":"49bad6f0-cfa1-4332-b5f4-b6e353aa3dc8","block_type":"box","text":"with the speculative limits. Thus, even if a Fund does not intend to exceed applicable position limits, it","page_number":351,"box":{"x":116,"y":242,"width":758,"height":12}},{"id":"0ad60c39-1717-4cef-a72d-360097c6373e","block_type":"box","text":"is possible that different clients managed by the Manager and its affiliates may be aggregated for this","page_number":351,"box":{"x":117,"y":258,"width":755,"height":12}},{"id":"e61f5408-6a32-4cf9-8a3f-a9c33619849f","block_type":"box","text":"purpose. Therefore, the trading decisions of the Manager may have to be modified and positions held","page_number":351,"box":{"x":117,"y":273,"width":757,"height":12}},{"id":"26f6a55c-3c75-4a48-9c0f-08a724072439","block_type":"box","text":"by a Fund liquidated in order to avoid exceeding such limits. The modification of investment decisions","page_number":351,"box":{"x":117,"y":289,"width":757,"height":12}},{"id":"7fe29c37-312e-4706-8276-3e7359c393d8","block_type":"box","text":"or the elimination of open positions, if it occurs, may adversely affect the profitability of a Fund. A","page_number":351,"box":{"x":116,"y":304,"width":723,"height":12}},{"id":"a49f42c5-774b-4a27-a179-4fd45fe10415","block_type":"box","text":"violation of position limits could also lead to regulatory action materially adverse to a Fund’s investment","page_number":351,"box":{"x":116,"y":320,"width":770,"height":12}},{"id":"7d3ffb98-1cdc-435e-94ae-0d635c89f4ac","block_type":"box","text":"strategy. A Fund may also be affected by other regimes, including those of the European Union and","page_number":351,"box":{"x":116,"y":335,"width":746,"height":12}},{"id":"42ef3ec2-1bcf-40c2-b0c0-2454b74a7a19","block_type":"box","text":"United Kingdom, and trading venues that impose position limits on commodity derivative contracts.","page_number":351,"box":{"x":117,"y":351,"width":737,"height":12}},{"id":"9ef6dc76-b59a-434a-b2e0-8aadf4ad1e4b","block_type":"box","text":"Additional Regulation of Derivatives.","page_number":351,"box":{"x":115,"y":382,"width":275,"height":12}},{"id":"f84c27fa-d570-48e9-97b8-c7cedaaa7aac","block_type":"box","text":"Regulatory bodies outside the U.S. have also passed,","page_number":351,"box":{"x":392,"y":382,"width":419,"height":12}},{"id":"77eb892a-1a97-4c40-bcd1-234d9a84c1b7","block_type":"box","text":"proposed, or may propose in the future, legislation","page_number":351,"box":{"x":117,"y":397,"width":386,"height":12}},{"id":"e20e2f96-affd-478a-8189-23b141272db3","block_type":"box","text":"similar to Dodd-Frank or other legislation that","page_number":351,"box":{"x":504,"y":397,"width":348,"height":12}},{"id":"784346a0-d6c6-4f34-bc0f-75cd51d8ad3c","block_type":"box","text":"could increase the costs of participating in, or","page_number":351,"box":{"x":116,"y":413,"width":345,"height":12}},{"id":"47659a9a-7b75-439a-a766-5c842d1a48b1","block_type":"box","text":"r otherwise adversely impact the liquidity of,","page_number":351,"box":{"x":461,"y":413,"width":332,"height":12}},{"id":"68e01840-554a-49eb-b86d-39d8882f1cb6","block_type":"box","text":"participating in the commodities markets. For","page_number":351,"box":{"x":117,"y":428,"width":341,"height":12}},{"id":"4983e21b-4038-4ba8-983e-9d419701383a","block_type":"box","text":"r example, the European Market Infrastructure","page_number":351,"box":{"x":458,"y":428,"width":351,"height":12}},{"id":"166ca216-9bde-4e76-b8f8-948941066c4f","block_type":"box","text":"Regulation (Regulation (EU) No 648/2012) (“EMIR”) in","page_number":351,"box":{"x":117,"y":444,"width":410,"height":12}},{"id":"55d49f1c-5b2b-4504-8d2f-54c340d6fb45","block_type":"box","text":"troduced certain requirements in respect of","page_number":351,"box":{"x":529,"y":444,"width":332,"height":12}},{"id":"6dbb561e-35a1-4aed-8942-b387891314b8","block_type":"box","text":"OTC derivatives including: (i) the mandatory clearing","page_number":351,"box":{"x":116,"y":459,"width":405,"height":12}},{"id":"5018f16a-c05b-4c40-9a45-ac5eaa921e3c","block_type":"box","text":"of OTC derivative contracts declared subject to","page_number":351,"box":{"x":522,"y":459,"width":362,"height":12}},{"id":"44224cda-a6a6-4aeb-8c88-4d03456e1bb0","block_type":"box","text":"the clearing obligation; (ii) risk mitigation te","page_number":351,"box":{"x":116,"y":475,"width":325,"height":12}},{"id":"bd7d3084-bdd6-4cb1-bf3f-87f5d29e57e0","block_type":"box","text":"chniques in respect of uncleared OTC derivative","page_number":351,"box":{"x":442,"y":475,"width":372,"height":12}},{"id":"0c1f33d1-af62-4910-9a8f-97bc8cd24c22","block_type":"box","text":"contracts, including the mandatory margining","page_number":351,"box":{"x":116,"y":490,"width":347,"height":12}},{"id":"71e10734-bfc7-4e4c-8176-7bc63a539f1b","block_type":"box","text":"of uncleared OTC derivative contracts; and","page_number":351,"box":{"x":463,"y":490,"width":332,"height":11}},{"id":"da8ed9dc-91b4-4a25-a1a6-c75fa45528a8","block_type":"box","text":"(iii) reporting and recordkeeping requirements in res","page_number":351,"box":{"x":117,"y":506,"width":393,"height":12}},{"id":"a28f3335-fe26-418b-a668-1aa717b8fc9a","block_type":"box","text":"pect of all derivatives contracts. By way of","page_number":351,"box":{"x":512,"y":506,"width":324,"height":12}},{"id":"2c028019-a564-4967-ae8b-4d1f5517f220","block_type":"box","text":"further example, the European Union Markets in","page_number":351,"box":{"x":116,"y":521,"width":365,"height":12}},{"id":"158acf14-7f50-401f-b46c-df655dd0a91f","block_type":"box","text":"Financial Instruments Directive (Directive","page_number":351,"box":{"x":482,"y":521,"width":322,"height":12}},{"id":"deca417a-bb45-443d-9504-2f4bb8b1bcf9","block_type":"box","text":"2014/65/EU) and Markets in Financial Instrument","page_number":351,"box":{"x":116,"y":537,"width":373,"height":12}},{"id":"ce59db88-3606-4a51-b063-d1c5eae2ef1a","block_type":"box","text":"s Regulation (Regulation (EU) No 600/2014)","page_number":351,"box":{"x":490,"y":537,"width":341,"height":12}},{"id":"e8900920-a68f-4e0e-ad49-c9151e63e649","block_type":"box","text":"(together “MiFID II”), which have applied since January","page_number":351,"box":{"x":117,"y":552,"width":422,"height":12}},{"id":"f901eb9d-e7a6-4510-9709-a9ab642ac66c","block_type":"box","text":"3, 2018, govern the provision of investment","page_number":351,"box":{"x":539,"y":552,"width":334,"height":12}},{"id":"eb8d746b-e35c-4831-850f-d5a2f7aedb73","block_type":"box","text":"services and activities in relation to, as well as","page_number":351,"box":{"x":116,"y":568,"width":351,"height":11}},{"id":"003243f2-0473-4a04-8e35-045bb4d86350","block_type":"box","text":"the organized trading of, financial instruments such","page_number":351,"box":{"x":467,"y":568,"width":399,"height":12}},{"id":"2214f25a-abbd-4e77-be5e-3e1f27c7b704","block_type":"box","text":"as shares, bonds, units in collective investment schemes and derivatives. In particular, MiFID II","page_number":351,"box":{"x":116,"y":583,"width":728,"height":12}},{"id":"559ba7cb-f27f-4da9-b24e-b1a44d4cc0ef","block_type":"box","text":"requires European Union Member States to apply positi","page_number":351,"box":{"x":117,"y":599,"width":420,"height":12}},{"id":"5b16821d-f886-413e-9ad1-31d77ba6da72","block_type":"box","text":"on limits to the size of a net position a person","page_number":351,"box":{"x":539,"y":599,"width":349,"height":12}},{"id":"cedd6cf5-848f-44d7-aa62-9ad2544a1f51","block_type":"box","text":"can hold at any time in commodity derivatives traded on European Union trading venues and in","page_number":351,"box":{"x":116,"y":614,"width":727,"height":12}},{"id":"b9caeb2f-dd19-487a-9972-103b00cdfaea","block_type":"box","text":"“economically equivalent” OTC contracts. If the requi","page_number":351,"box":{"x":116,"y":630,"width":400,"height":12}},{"id":"836008c8-c44d-46bf-81ab-f25fb7e090bc","block_type":"box","text":"rements of EMIR and MiFID II apply, the cost of","page_number":351,"box":{"x":518,"y":630,"width":366,"height":12}},{"id":"4903fa0e-84f4-4774-b8af-6a43c3ba6fdd","block_type":"box","text":"derivatives transactions is expected to increase.","page_number":351,"box":{"x":116,"y":645,"width":370,"height":12}},{"id":"eedba5ec-e300-463a-82cc-6ccdd04ef22e","block_type":"box","text":"In addition, regulations adopted by global prudential regulators that are now in effect require certain","page_number":351,"box":{"x":117,"y":676,"width":736,"height":12}},{"id":"ae407bef-7591-4de0-b2a6-e8d3c12f161b","block_type":"box","text":"prudentially regulated entities and certain of their affiliates and subsidiaries (including swap dealers) to","page_number":351,"box":{"x":117,"y":692,"width":758,"height":12}},{"id":"d99a3904-bfbf-4c82-bddd-94596430d38a","block_type":"box","text":"include in their derivatives contracts and certain other financial contracts, terms that delay or restrict","page_number":351,"box":{"x":117,"y":707,"width":740,"height":12}},{"id":"b38abe9a-1740-42c1-8250-5f5c3b96d8c6","block_type":"box","text":"the rights of counterparties (such as the Funds) to terminate such contracts, foreclose upon collateral,","page_number":351,"box":{"x":116,"y":723,"width":755,"height":12}},{"id":"43f9cbd5-9a89-4256-9f0d-b03bd5f3f289","block_type":"box","text":"exercise other default rights or restrict transfers of credit support in the event that the prudentially","page_number":351,"box":{"x":116,"y":738,"width":721,"height":12}},{"id":"aab5b9a5-edbd-4dc8-beab-8b3dfbf16360","block_type":"box","text":"regulated entity and/or its affiliates are subject to certain types of resolution or insolvency proceedings.","page_number":351,"box":{"x":117,"y":754,"width":759,"height":12}},{"id":"347c95af-124e-4c06-bf4a-73577fe2e364","block_type":"box","text":"Similar regulations and laws have been adopted in non-U.S. jurisdictions that may apply to a Fund’s","page_number":351,"box":{"x":116,"y":769,"width":741,"height":12}},{"id":"6cce4e90-d8de-413d-8e4f-07c4558b7162","block_type":"box","text":"counterparties located in those jurisdictions. In particular, in the United Kingdom and the European","page_number":351,"box":{"x":116,"y":785,"width":731,"height":12}},{"id":"e39bfe72-d7d7-416f-8c31-0d71a0c147e0","block_type":"box","text":"Union, governmental authorities could reduce, eliminate or convert to equity the liabilities to a Fund of","page_number":351,"box":{"x":117,"y":800,"width":753,"height":12}},{"id":"4609f193-0442-419f-9040-48a85f5023a9","block_type":"box","text":"a counterparty experiencing financial difficulties (sometimes referred to as a “bail in”). It is possible that","page_number":351,"box":{"x":116,"y":816,"width":763,"height":12}},{"id":"64520e1b-5e82-481d-81d0-d73f2b0e92ce","block_type":"box","text":"these requirements, as well as potential additional related government regulation, could adversely","page_number":351,"box":{"x":116,"y":831,"width":731,"height":12}},{"id":"3b2d96ca-bf98-4d7d-a3ed-15d3657359b0","block_type":"box","text":"affect a Fund’s ability to terminate existing derivatives contracts, exercise default rights or satisfy","page_number":351,"box":{"x":116,"y":847,"width":721,"height":12}},{"id":"d4b3c079-215c-4b3b-b7a8-bda05c9806f2","block_type":"box","text":"obligations owed to it with collateral received under such contracts.","page_number":351,"box":{"x":116,"y":862,"width":502,"height":12}},{"id":"b3b2d96a-4757-498c-b7a3-5b10228e305f","block_type":"box","text":"II-19","page_number":351,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"ebd9b99b-f800-4f67-8c0e-e4ea8e28dd91","block_type":"box","text":"NM1026U-6004382-351/605","page_number":351,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ea8b2495-1e83-48ee-9791-8b544238b249","block_type":"box","text":"Regulatory changes or actions may alter the nature of an investment in bitcoin or ether futures or","page_number":352,"box":{"x":117,"y":87,"width":723,"height":12}},{"id":"c6598383-0e5c-499f-8b1c-a5899b2f08ed","block_type":"box","text":"restrict the use of bitcoin or ether or the operations of digital asset networks or exchanges on which","page_number":352,"box":{"x":117,"y":102,"width":741,"height":13}},{"id":"559fb39a-ed6a-4f7f-a50b-ff46cfea173e","block_type":"box","text":"bitcoin or ether trades in a manner that adversely affects the price of such digital asset futures, which","page_number":352,"box":{"x":117,"y":118,"width":754,"height":12}},{"id":"69082b79-017f-4309-b6d3-f45c2eb4845d","block_type":"box","text":"could adversely impact a Fund.","page_number":352,"box":{"x":116,"y":134,"width":237,"height":12}},{"id":"13973661-8e52-444f-95ae-dccb929ca176","block_type":"box","text":"Risk Factors in Derivatives.","page_number":352,"box":{"x":116,"y":166,"width":208,"height":9}},{"id":"66eb14b1-c9b2-4a57-bc5b-e651097688fb","block_type":"box","text":"There are significant risks that apply generally to derivatives transactions, including:","page_number":352,"box":{"x":116,"y":190,"width":627,"height":12}},{"id":"c0ab9ea7-9723-4549-9190-c7498f22615c","block_type":"box","text":"Correlation Risk —","page_number":352,"box":{"x":117,"y":222,"width":123,"height":9}},{"id":"1d5f40c3-4393-41aa-b1b4-07d0e359695e","block_type":"box","text":"— the risk that changes in the value of a derivative will not match the changes in the","page_number":352,"box":{"x":240,"y":222,"width":631,"height":12}},{"id":"9281c7c3-423f-455d-aedb-609005d345d5","block_type":"box","text":"value of the portfolio holdings that are being hedged or of the particular market or security to which the","page_number":352,"box":{"x":116,"y":237,"width":765,"height":12}},{"id":"b0570e20-caec-41d7-81d3-e8556df26b06","block_type":"box","text":"Fund seeks exposure. There are a number of factors which may prevent a derivative instrument from","page_number":352,"box":{"x":117,"y":253,"width":754,"height":12}},{"id":"a0788229-927e-4b32-a24c-77c966516982","block_type":"box","text":"achieving the desired correlation (or inverse correlation) with an underlying asset, rate or index, such","page_number":352,"box":{"x":116,"y":268,"width":753,"height":12}},{"id":"185f18d1-045e-4c39-947b-d4bcac3e05aa","block_type":"box","text":"as the impact of fees, expenses and transaction costs, the timing of pricing, and disruptions or illiquidity","page_number":352,"box":{"x":116,"y":284,"width":772,"height":12}},{"id":"11968bf6-4c4b-4df1-bfcc-ce3044af5463","block_type":"box","text":"in the markets for such derivative instrument.","page_number":352,"box":{"x":117,"y":299,"width":338,"height":10}},{"id":"17dcbebc-31a5-428e-b85c-3d588c187705","block_type":"box","text":"Counterparty Risk —","page_number":352,"box":{"x":117,"y":331,"width":138,"height":12}},{"id":"188da565-d9a2-437a-b019-901d1f13be0c","block_type":"box","text":"—","page_number":352,"box":{"x":255,"y":337,"width":22,"height":4}},{"id":"104ecb2d-530f-43b2-8d34-55365e513ccd","block_type":"box","text":"the risk that a derivatives transaction counterparty will be unable or unwilling to","page_number":352,"box":{"x":277,"y":332,"width":590,"height":11}},{"id":"686e234d-f079-4e13-b345-952f7cdeaf5e","block_type":"box","text":"make payments or otherwise honor its obligations to a Fund and the related risks of having","page_number":352,"box":{"x":117,"y":347,"width":678,"height":12}},{"id":"71cf0a8b-2fa4-4cd5-bb6d-294db8f854f6","block_type":"box","text":"concentrated exposure to such a counterparty. In particular, derivatives traded in OTC markets often","page_number":352,"box":{"x":116,"y":362,"width":751,"height":12}},{"id":"daa6c768-6a5e-447a-972a-98d31342065b","block_type":"box","text":"are not guaranteed by an exchange or clearing corporation and often do not require payment of","page_number":352,"box":{"x":116,"y":378,"width":714,"height":12}},{"id":"6ecbaeb1-f6aa-4903-a200-07200e528849","block_type":"box","text":"margin, and to the extent that the Fund has unrealized gains in such instruments or has deposited","page_number":352,"box":{"x":117,"y":394,"width":732,"height":11}},{"id":"137ce296-f126-45f9-979a-67102130706b","block_type":"box","text":"collateral with its counterparties the Fund is at risk that its counterparties will become bankrupt or","page_number":352,"box":{"x":116,"y":409,"width":725,"height":12}},{"id":"ed2e6317-4067-41f9-b2d5-9fa3328cd4f2","block_type":"box","text":"otherwise fail to honor their obligations. A Fund will typically attempt to minimize counterparty risk by","page_number":352,"box":{"x":116,"y":424,"width":750,"height":13}},{"id":"a2d89796-1574-43a4-8754-182b2f33b6e5","block_type":"box","text":"engaging in OTC derivatives transactions only with creditworthy entities that have substantial capital or","page_number":352,"box":{"x":116,"y":440,"width":768,"height":12}},{"id":"7d7ffc46-1416-4cad-a81d-aa1030efd90d","block_type":"box","text":"that have provided the Fund with a third-party guaranty or other credit support. When a Fund enters","page_number":352,"box":{"x":116,"y":456,"width":745,"height":12}},{"id":"722c7439-b5a1-4d93-a8ad-b54a6f08d0cf","block_type":"box","text":"into a derivatives transaction that is centrally cleared (whether mandatorily or voluntarily), the Fund is","page_number":352,"box":{"x":117,"y":471,"width":754,"height":12}},{"id":"d401b20c-bb9e-4e99-bfec-e11c68a21294","block_type":"box","text":"subject to the credit risk of the clearing house and the clearing member through which it holds its","page_number":352,"box":{"x":116,"y":486,"width":722,"height":13}},{"id":"b39adeb1-60d8-462c-874c-e393fe026ed0","block_type":"box","text":"cleared position. Credit risk of market participants with respect to derivatives that are centrally cleared","page_number":352,"box":{"x":116,"y":502,"width":761,"height":12}},{"id":"c3393fbf-25e1-4041-951f-9286cf8129d3","block_type":"box","text":"is concentrated in a few clearing houses and increasingly fewer clearing members. It is not clear how","page_number":352,"box":{"x":117,"y":517,"width":754,"height":13}},{"id":"bf953796-dd00-4385-aab5-2164f9e5b711","block_type":"box","text":"an insolvency proceeding of a clearing house would be conducted and what impact an insolvency of a","page_number":352,"box":{"x":116,"y":533,"width":762,"height":12}},{"id":"96d3794c-cd57-4786-88f0-55529f2cd85d","block_type":"box","text":"clearing house would have on the financial system. Also, a Fund will not be fully protected in the event","page_number":352,"box":{"x":116,"y":548,"width":764,"height":13}},{"id":"6620cef3-d115-4ff5-b52a-f5b77dbed91a","block_type":"box","text":"of the bankruptcy of a Fund’s clearing member because the Fund would be limited to recovering only a","page_number":352,"box":{"x":116,"y":564,"width":768,"height":12}},{"id":"b754a514-ca65-4bd6-96d7-747696f3b2e8","block_type":"box","text":"pro rata share of the funds held by the clearing member on behalf of customers by account class for","page_number":352,"box":{"x":117,"y":579,"width":747,"height":13}},{"id":"3f8e1fa9-d440-48cb-be72-b00d5b606ace","block_type":"box","text":"cleared derivatives. Although a clearing member is required to segregate assets from customers with","page_number":352,"box":{"x":116,"y":595,"width":755,"height":12}},{"id":"2d58d608-4b15-4d7f-bfbd-bef87e0ac46a","block_type":"box","text":"respect to cleared derivatives positions from the clearing member’s proprietary assets, if a clearing","page_number":352,"box":{"x":117,"y":610,"width":736,"height":13}},{"id":"7283c7fe-65c0-45b2-a182-f4a01f00f374","block_type":"box","text":"member does not comply with the applicable regulations, or in the event of fraud or misappropriation of","page_number":352,"box":{"x":117,"y":626,"width":768,"height":12}},{"id":"f4a8e622-bce7-4d12-a7c7-dd9af07d4209","block_type":"box","text":"customer assets by a clearing member, a Fund could have only an unsecured creditor claim in an","page_number":352,"box":{"x":116,"y":642,"width":730,"height":12}},{"id":"81cee5be-1a6f-4de4-b11c-fee108e16309","block_type":"box","text":"insolvency of the clearing member with respect to the assets held by the clearing member.","page_number":352,"box":{"x":117,"y":657,"width":675,"height":12}},{"id":"0867a7ae-1d0c-4bbf-b57b-9fbb8c556143","block_type":"box","text":"Credit Risk","page_number":352,"box":{"x":117,"y":689,"width":82,"height":10}},{"id":"ee30d6de-4bc1-4918-b80a-60a97d6d8ea0","block_type":"box","text":"— the risk that the reference entity in a credit default swap or similar derivative will not be","page_number":352,"box":{"x":203,"y":689,"width":663,"height":12}},{"id":"a7d4d568-7f99-48a1-943a-dc1c90b1f5f3","block_type":"box","text":"able to honor its financial obligations.","page_number":352,"box":{"x":116,"y":705,"width":274,"height":12}},{"id":"9f5aeb48-feae-4472-a3e0-678c0086f015","block_type":"box","text":"Currency Risk","page_number":352,"box":{"x":117,"y":737,"width":105,"height":12}},{"id":"229107d6-3d4f-462c-a869-f1f8d5a36178","block_type":"box","text":"— the risk that changes in the exchange rate between two currencies will adversely","page_number":352,"box":{"x":226,"y":737,"width":620,"height":12}},{"id":"9fc91691-c1bc-42ea-98cb-e58237401230","block_type":"box","text":"affect the value (in U.S. dollar terms) of a derivative.","page_number":352,"box":{"x":116,"y":752,"width":386,"height":12}},{"id":"ab3790e7-f433-4b98-9995-a4adb92d4c90","block_type":"box","text":"Illiquidity Risk","page_number":352,"box":{"x":117,"y":785,"width":101,"height":12}},{"id":"b7f81f39-ff6b-4cfa-9437-dbbb0a4a4b99","block_type":"box","text":"— the risk that certain securities or instruments may be difficult or impossible to sell at","page_number":352,"box":{"x":222,"y":784,"width":639,"height":13}},{"id":"78731624-3eb6-4db9-8ce9-36d87019f408","block_type":"box","text":"the time or at the price desired by a Fund in connection with payments of margin, collateral, or","page_number":352,"box":{"x":116,"y":800,"width":699,"height":12}},{"id":"76d71f2d-f544-4069-86f7-74b99a5b3ea8","block_type":"box","text":"settlement payments. There can be no assurance that a Fund will be able to unwind or offset a","page_number":352,"box":{"x":116,"y":815,"width":703,"height":13}},{"id":"d3cc86e6-85d0-40d8-9bb4-e7abff94e025","block_type":"box","text":"derivative at its desired price, in a secondary market or otherwise. It may, therefore, not be possible for","page_number":352,"box":{"x":116,"y":831,"width":768,"height":12}},{"id":"e9f353bb-ffec-4fad-bbbb-9b5f082f3819","block_type":"box","text":"the Fund to unwind its position in a derivative without incurring substantial losses (if at all). Certain","page_number":352,"box":{"x":116,"y":846,"width":733,"height":13}},{"id":"1e468a9e-95f7-4510-8ee9-1620d33dba1a","block_type":"box","text":"OTC derivatives, including swaps and OTC options, involve substantial illiquidity risk. Illiquidity may","page_number":352,"box":{"x":116,"y":862,"width":741,"height":12}},{"id":"0b97d0d2-1228-4242-b9af-144a7452b6aa","block_type":"box","text":"also make it more difficult for a Fund to ascertain a market value for such derivatives. A Fund will,","page_number":352,"box":{"x":116,"y":877,"width":729,"height":12}},{"id":"9c6f6f2e-a0c7-4272-95ee-b796fc25d204","block_type":"box","text":"II-20","page_number":352,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"5e7b828c-bde3-4dc1-ab98-46d6f270bfa2","block_type":"box","text":"NM1026U-6004382-352/605","page_number":352,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"09500914-2102-4058-a571-071d79e1ea55","block_type":"box","text":"therefore, acquire illiquid OTC derivatives (i) if the agreement pursuant to which the instrument is","page_number":353,"box":{"x":116,"y":87,"width":724,"height":12}},{"id":"65478a47-e7d8-4808-9e1b-eceb23f130e2","block_type":"box","text":"purchased contains a formula price at which the instrument may be terminated or sold, or (ii) for which","page_number":353,"box":{"x":117,"y":102,"width":763,"height":13}},{"id":"e406a91d-3dc0-4e08-918d-acd5a67a489c","block_type":"box","text":"the Manager anticipates the Fund can receive on each business day at least two independent bids or","page_number":353,"box":{"x":116,"y":118,"width":756,"height":12}},{"id":"66c0345a-26fb-4280-9a35-ab7e90f0238a","block_type":"box","text":"offers, unless a quotation from only one dealer is available, in which case that dealer’s quotation may","page_number":353,"box":{"x":116,"y":134,"width":756,"height":12}},{"id":"a1f975a6-d753-44f6-a45f-341c411f8c1b","block_type":"box","text":"be used. The illiquidity of the derivatives markets may be due to various factors, including congestion,","page_number":353,"box":{"x":117,"y":149,"width":758,"height":12}},{"id":"19a07ec9-776f-4d1d-970e-a9473f4aee54","block_type":"box","text":"disorderly markets, limitations on deliverable supplies, the participation of speculators, government","page_number":353,"box":{"x":116,"y":165,"width":738,"height":12}},{"id":"553bc41b-464d-4742-a7c7-31311c241378","block_type":"box","text":"regulation and intervention, and technical and operational or system failures. In addition, the liquidity of","page_number":353,"box":{"x":117,"y":180,"width":767,"height":12}},{"id":"b4534bf9-4652-4eff-a4c2-9734d732906f","block_type":"box","text":"a market in an exchange-traded derivative contract may be adversely affected by “daily price","page_number":353,"box":{"x":116,"y":196,"width":693,"height":12}},{"id":"1ac66577-b422-4db0-b482-88cabeed207c","block_type":"box","text":"fluctuation limits” established by the exchanges which limit the amount of fluctuation in an exchange","page_number":353,"box":{"x":116,"y":211,"width":747,"height":12}},{"id":"b800f9e8-719e-437a-9d72-ffaaf421489d","block_type":"box","text":"traded contract price during a single trading day. Once the daily limit has been reached in the contract,","page_number":353,"box":{"x":116,"y":227,"width":766,"height":12}},{"id":"5d05ca8d-bf03-4e0f-bdd9-ce0cef9484d7","block_type":"box","text":"no trades may be entered into at a price beyond the limit, thus preventing the liquidation of open","page_number":353,"box":{"x":117,"y":242,"width":717,"height":12}},{"id":"380b2a96-c884-4122-adb3-28d2bc0d8f9d","block_type":"box","text":"positions. Prices have in the past moved to the daily limit on a number of consecutive trading days with","page_number":353,"box":{"x":117,"y":258,"width":768,"height":12}},{"id":"64590305-6894-4dff-9e7f-ff3205e7d80a","block_type":"box","text":"little to no trading. If it is not possible to close an open derivative position entered into by the Fund, the","page_number":353,"box":{"x":117,"y":273,"width":762,"height":12}},{"id":"2cec55cc-dff8-41fa-bac6-ed05ea4d9fa6","block_type":"box","text":"Fund would continue to be required to make daily cash payments of variation margin in the event of","page_number":353,"box":{"x":117,"y":289,"width":743,"height":12}},{"id":"32d50ed6-5a37-4fce-a2c4-3d69a7e1e3f4","block_type":"box","text":"adverse price movements. In such a situation, if the Fund has insufficient cash, it may have to sell","page_number":353,"box":{"x":116,"y":304,"width":732,"height":12}},{"id":"cb2b5386-dd30-4f33-a370-73cf62807bf7","block_type":"box","text":"portfolio securities to meet daily variation margin requirements at a time when it may be","page_number":353,"box":{"x":117,"y":320,"width":654,"height":12}},{"id":"95cfe048-80f0-429c-acc1-8a40d59c8935","block_type":"box","text":"disadvantageous to do so. Fund’s investment in digital asset futures may involve illiquidity risk, as","page_number":353,"box":{"x":116,"y":335,"width":729,"height":12}},{"id":"5b71231b-0e00-4b80-8643-c158ff764135","block_type":"box","text":"digital asset futures are not as heavily traded as other futures given that the digital asset futures market","page_number":353,"box":{"x":116,"y":351,"width":772,"height":12}},{"id":"6c75efa4-a899-4fcf-b5ee-b732da5ba4d7","block_type":"box","text":"is relatively new.","page_number":353,"box":{"x":117,"y":366,"width":127,"height":12}},{"id":"29d6c6e4-2e5a-40a4-9e0d-5742cefcaa02","block_type":"box","text":"Index Risk","page_number":353,"box":{"x":117,"y":397,"width":78,"height":10}},{"id":"5356670d-53f3-4ce9-b130-76997d98675e","block_type":"box","text":"k — if the derivative is linked to the performance of an index, it will be subject to the risks","page_number":353,"box":{"x":194,"y":397,"width":656,"height":12}},{"id":"e3fe342f-40a3-4fe7-89da-76ff86fcdc62","block_type":"box","text":"associated with changes in that index. If the index changes, the Fund could receive lower interest","page_number":353,"box":{"x":116,"y":413,"width":728,"height":12}},{"id":"b4b3b27a-795e-42b3-a9e2-29875e2d6e2e","block_type":"box","text":"payments or experience a reduction in the value of the derivative to below the price that the Fund paid","page_number":353,"box":{"x":117,"y":428,"width":762,"height":12}},{"id":"74f67b59-e8df-43f4-983a-599a5a6a4ca8","block_type":"box","text":"for such derivative.","page_number":353,"box":{"x":116,"y":444,"width":146,"height":9}},{"id":"9aab9cee-639b-4da6-a331-6913110998dc","block_type":"box","text":"Legal Risk","page_number":353,"box":{"x":116,"y":475,"width":79,"height":12}},{"id":"35575d39-ccfc-4150-a2a3-762318bd9069","block_type":"box","text":"k — the risk of insufficient documentation, insufficient capacity or authority of counterparty, or","page_number":353,"box":{"x":194,"y":475,"width":689,"height":12}},{"id":"ac31ef93-282e-4a89-bd9e-87dad0f66ed2","block_type":"box","text":"legality or enforceability of a contract.","page_number":353,"box":{"x":117,"y":490,"width":281,"height":12}},{"id":"05db384a-4e40-4285-b824-56c2fae6a416","block_type":"box","text":"Leverage Risk —","page_number":353,"box":{"x":116,"y":521,"width":112,"height":12}},{"id":"a3f0dfd1-49ca-40f4-bd6a-4d603842817c","block_type":"box","text":"— the risk that a Fund’s derivatives transactions can magnify the Fund’s gains and","page_number":353,"box":{"x":228,"y":521,"width":619,"height":12}},{"id":"71a191fa-a4ff-44df-b4ad-2a1b90a1a908","block_type":"box","text":"losses. Relatively small market movements may result in large changes in the value of a derivatives","page_number":353,"box":{"x":117,"y":537,"width":744,"height":12}},{"id":"2c2bd3d6-8b56-43b3-96b9-a4fe2cf3825f","block_type":"box","text":"position and can result in losses that greatly exceed the amount originally invested.","page_number":353,"box":{"x":117,"y":552,"width":621,"height":12}},{"id":"d07e5cd2-117d-4331-b9bc-cc78acc2bdef","block_type":"box","text":"Market Risk —","page_number":353,"box":{"x":116,"y":583,"width":93,"height":10}},{"id":"aed1f854-5b5c-427b-a014-c6ef779f0163","block_type":"box","text":"— the risk that changes in the value of one or more markets or changes with respect to","page_number":353,"box":{"x":209,"y":583,"width":653,"height":12}},{"id":"e0d02161-49d0-45d1-a268-91aacc7db9f7","block_type":"box","text":"the value of the underlying asset will adversely affect the value of a derivative. In the event of an","page_number":353,"box":{"x":116,"y":599,"width":719,"height":12}},{"id":"1eb3cdab-b50e-4931-a534-4ea8c7fcb6cb","block_type":"box","text":"adverse movement, a Fund may be required to pay substantial additional margin to maintain its","page_number":353,"box":{"x":116,"y":614,"width":713,"height":12}},{"id":"754aac83-8f00-4c26-b030-532f3f5d6f1a","block_type":"box","text":"position or the Fund’s returns may be adversely affected.","page_number":353,"box":{"x":117,"y":630,"width":427,"height":12}},{"id":"e77cf1fd-c5dc-4bdc-b1c9-7a1e7c429227","block_type":"box","text":"Operational Risk","page_number":353,"box":{"x":117,"y":661,"width":124,"height":12}},{"id":"c70e0776-e6a0-4a77-b7b6-63272adb53fd","block_type":"box","text":"— the risk related to potential operational issues, including documentation issues,","page_number":353,"box":{"x":245,"y":661,"width":605,"height":12}},{"id":"f1dc6683-febc-4408-9e60-70102b75a2e1","block_type":"box","text":"settlement issues, systems failures, inadequate controls and human error.","page_number":353,"box":{"x":116,"y":676,"width":548,"height":12}},{"id":"0d12b832-911a-4452-afd6-6233243923bc","block_type":"box","text":"Valuation Risk","page_number":353,"box":{"x":118,"y":707,"width":106,"height":10}},{"id":"0c485d8a-0f77-48ce-8930-6cabdadce282","block_type":"box","text":"— the risk that valuation sources for a derivative will not be readily available in the","page_number":353,"box":{"x":228,"y":707,"width":609,"height":12}},{"id":"bb6fd116-26f7-4a9c-b84c-bd8b866b9bae","block_type":"box","text":"market. This is possible especially in times of market distress, since many market participants may be","page_number":353,"box":{"x":117,"y":723,"width":754,"height":12}},{"id":"8a026714-6625-4f88-b31f-531cbdafe0ef","block_type":"box","text":"reluctant to purchase complex instruments or quote prices for them. Exchanges where bitcoin or ether","page_number":353,"box":{"x":117,"y":738,"width":757,"height":12}},{"id":"28145b6c-3e1a-4161-920d-5cc61de5ba4e","block_type":"box","text":"is traded (which are the source of the price(s) used to determine the cash settlement amount for a","page_number":353,"box":{"x":117,"y":754,"width":726,"height":12}},{"id":"eb829728-cbfa-4fd8-98a2-60249e2bab58","block_type":"box","text":"Fund’s bitcoin or ether futures) have experienced technical and operational issues, making bitcoin","page_number":353,"box":{"x":117,"y":769,"width":724,"height":12}},{"id":"bd5b205e-7168-4077-89fd-bd9a4702ac1f","block_type":"box","text":"prices unavailable at times. In addition, the cash market in bitcoin or ether has been the target of fraud","page_number":353,"box":{"x":117,"y":785,"width":758,"height":12}},{"id":"9bbdeb7a-f452-4322-8ff6-311ec5b7f9f5","block_type":"box","text":"and manipulation, which could affect the pricing of bitcoin or ether futures contracts.","page_number":353,"box":{"x":116,"y":800,"width":620,"height":12}},{"id":"1fa914c1-d48c-4fc7-b506-3f2bb4c29191","block_type":"box","text":"Volatility Risk —","page_number":353,"box":{"x":118,"y":831,"width":102,"height":12}},{"id":"4318ceb5-216c-4542-a813-e6ffc59ae9ff","block_type":"box","text":"— the risk that the value of derivatives will fluctuate significantly within a short time","page_number":353,"box":{"x":220,"y":831,"width":619,"height":12}},{"id":"b9c32d34-5290-4a58-b3b2-b665b58e2cc5","block_type":"box","text":"period. In particular, bitcoin, ether, bitcoin futures and ether futures have generally exhibited significant","page_number":353,"box":{"x":117,"y":847,"width":765,"height":12}},{"id":"c585c2b7-b6b8-47c0-bc73-b23233381db1","block_type":"box","text":"price volatility relative to more traditional asset classes. Bitcoin and ether futures may also experience","page_number":353,"box":{"x":117,"y":862,"width":759,"height":12}},{"id":"b9767210-dc13-43ca-a9e1-5c4448bbd1e6","block_type":"box","text":"significant price volatility as a result of the market fraud and manipulation noted above.","page_number":353,"box":{"x":116,"y":878,"width":648,"height":12}},{"id":"d1151eae-b171-433c-894f-e91d847b2421","block_type":"box","text":"II-21","page_number":353,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"e14db351-87b7-4cb9-98a6-214e9586984e","block_type":"box","text":"NM1026U-6004382-353/605","page_number":353,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"11832235-acf6-458b-b4de-c8d5367ab6da","block_type":"box","text":"Types of Derivatives Transactions.","page_number":354,"box":{"x":118,"y":87,"width":261,"height":12}},{"id":"d14c0b03-f04b-4d16-9ac2-36bb24d3aebb","block_type":"box","text":"A Fund may enter into derivatives transactions in accordance with its investment guidelines and","page_number":354,"box":{"x":116,"y":110,"width":715,"height":12}},{"id":"f8ffc7e5-4029-4744-89b1-7fecc12ef48f","block_type":"box","text":"restrictions, including the following:","page_number":354,"box":{"x":117,"y":126,"width":263,"height":12}},{"id":"0afa1bbf-ce94-4510-ac9d-1ac309e4c4b6","block_type":"box","text":"Futures.","page_number":354,"box":{"x":116,"y":157,"width":66,"height":9}},{"id":"5334a627-d0a5-4356-95cc-d075954d1742","block_type":"box","text":"A Fund may enter into futures contracts (“futures”) and options on futures contracts. Futures are","page_number":354,"box":{"x":116,"y":180,"width":718,"height":12}},{"id":"984fd418-13ff-478b-a305-a62fbf4c6dd8","block_type":"box","text":"standardized, exchange-traded contracts that require a purchaser to take delivery, and a seller to make","page_number":354,"box":{"x":116,"y":196,"width":772,"height":12}},{"id":"84c96d60-4639-4e3c-8352-ac80b5511db8","block_type":"box","text":"delivery, of a specified amount of an asset at a specified future date and price. Upon purchasing or","page_number":354,"box":{"x":116,"y":211,"width":738,"height":12}},{"id":"c91240fb-c013-4f21-9cb6-0b2b116a7e37","block_type":"box","text":"selling a futures contract, a Fund is required to deposit initial margin equal to a percentage of the","page_number":354,"box":{"x":116,"y":227,"width":723,"height":12}},{"id":"7864afbc-791b-4116-93c5-5fe77a67e66a","block_type":"box","text":"contract value. Futures contracts are marked to market daily for the duration of the contract, and the","page_number":354,"box":{"x":116,"y":242,"width":748,"height":12}},{"id":"e8930c3f-f026-46d4-874e-31f35cc3cdec","block_type":"box","text":"Fund will either post additional margin or be entitled to a payment, as applicable, based on the","page_number":354,"box":{"x":117,"y":258,"width":704,"height":12}},{"id":"24cf94fb-418c-4741-80c5-71470d0022a9","block_type":"box","text":"mark-to-market movement of the contract.","page_number":354,"box":{"x":117,"y":273,"width":317,"height":10}},{"id":"61a600d8-aff4-4cd9-9cae-40cfbddba7db","block_type":"box","text":"A Fund may sell a futures contract prior to the completion","page_number":354,"box":{"x":116,"y":304,"width":431,"height":12}},{"id":"e20692f1-5ae4-44ee-9ad4-52be5f839927","block_type":"box","text":"of its term to limit its risk of loss from a","page_number":354,"box":{"x":548,"y":304,"width":290,"height":10}},{"id":"fc501361-2b93-4c7b-8c06-bce2573426c9","block_type":"box","text":"decline in the market value of portfolio holdings correlated with the futures contract. However, in the","page_number":354,"box":{"x":116,"y":320,"width":745,"height":12}},{"id":"295f54b0-e619-4974-8f8c-cb0d021a89cd","block_type":"box","text":"event the market value of the portfolio holdings correlated with the futures contract increases rather","page_number":354,"box":{"x":116,"y":335,"width":742,"height":12}},{"id":"afca7cb9-7ac1-4e47-b8c0-7643e5a3522f","block_type":"box","text":"than decreases, a Fund will realize a loss on the futures position and a lower return on the portfolio","page_number":354,"box":{"x":116,"y":351,"width":739,"height":12}},{"id":"dc8593fa-e50d-4a30-a0a8-c206bb6933a4","block_type":"box","text":"holdings than would have been realized without the purchase of the futures contract.","page_number":354,"box":{"x":117,"y":366,"width":631,"height":12}},{"id":"2d80ba2e-fdcf-43c8-af07-bed0f48ff1a4","block_type":"box","text":"The purchase of a futures contract may provide a Fund a lower cost alternative to purchasing","page_number":354,"box":{"x":116,"y":397,"width":697,"height":12}},{"id":"de8ebc06-249b-4f24-ad7e-db7f2ac5a284","block_type":"box","text":"securities or commodities directly. In the event that such securities or commodities decline in value or a","page_number":354,"box":{"x":116,"y":413,"width":772,"height":12}},{"id":"2fedcdfa-9edc-4601-9371-4a9619d63ed7","block_type":"box","text":"Fund determines not to complete an anticipatory hedge transaction relating to a futures contract,","page_number":354,"box":{"x":117,"y":428,"width":720,"height":12}},{"id":"ab60cc72-e00c-4f87-b285-96a872368c9d","block_type":"box","text":"however, the Fund may realize a loss relating to the futures position.","page_number":354,"box":{"x":117,"y":444,"width":512,"height":12}},{"id":"19e82f48-d20e-42f1-b2ee-b1e2b3debd15","block_type":"box","text":"Futures contracts are also subject to position limits. In order to comply with position limits, a Fund may","page_number":354,"box":{"x":117,"y":475,"width":763,"height":12}},{"id":"71321741-e2e7-459d-b543-610dc71d1fa7","block_type":"box","text":"be required to liquidate positions or may not be able to fully implement trading instructions. Any such","page_number":354,"box":{"x":117,"y":490,"width":750,"height":12}},{"id":"ec8619f1-70f0-466f-9041-0f4fe265a230","block_type":"box","text":"liquidation or limited implementation could result in substantial costs to a Fund. See “— Regulation of","page_number":354,"box":{"x":117,"y":506,"width":754,"height":12}},{"id":"eb7304ac-17b9-46da-a34d-a5dc2c0f3de8","block_type":"box","text":"Derivatives — Dodd-Frank Regulations” above.","page_number":354,"box":{"x":117,"y":521,"width":356,"height":12}},{"id":"6ebb1449-4b02-466a-9b29-007e70f8f43f","block_type":"box","text":"A Fund is also permitted to purchase or sell call and put options on futures contracts, including","page_number":354,"box":{"x":116,"y":552,"width":706,"height":12}},{"id":"245dd761-c076-488b-b577-5d930d4e3ae7","block_type":"box","text":"financial futures and stock indices. Generally, these strategies would be used under the same market","page_number":354,"box":{"x":116,"y":568,"width":757,"height":12}},{"id":"f2f8919d-5d09-4e7d-98e9-aa0eefa18e51","block_type":"box","text":"and market sector conditions (","page_number":354,"box":{"x":116,"y":583,"width":225,"height":12}},{"id":"c0bf1598-b962-4497-95ad-b78843cb7870","block_type":"box","text":"i.e.","page_number":354,"box":{"x":342,"y":583,"width":20,"height":10}},{"id":"9c293de8-c2b4-456f-8a04-b6290f1f4731","block_type":"box","text":", conditions relating to specific types of investments) in which the","page_number":354,"box":{"x":365,"y":583,"width":485,"height":12}},{"id":"a7ee0140-7860-4e4d-89e8-4dd5ed687280","block_type":"box","text":"Fund entered into futures transactions. A Fund may purchase put options or write call options on","page_number":354,"box":{"x":117,"y":599,"width":720,"height":12}},{"id":"0803f6d5-d696-4064-a3b6-955dfbe41091","block_type":"box","text":"futures contracts and stock indices in lieu of selling the underlying futures contract in anticipation of a","page_number":354,"box":{"x":116,"y":614,"width":754,"height":12}},{"id":"8520e474-835a-492f-86f2-071b1170851a","block_type":"box","text":"decrease in the market value of its securities. Similarly, a Fund can purchase call options, or write put","page_number":354,"box":{"x":116,"y":630,"width":759,"height":12}},{"id":"f852fd53-4973-4b37-b230-ab808bf98e8c","block_type":"box","text":"options on futures contracts and stock indices, as a substitute for the purchase of such futures","page_number":354,"box":{"x":116,"y":645,"width":705,"height":12}},{"id":"954dda00-20a0-48c4-a96d-f42855bb9eed","block_type":"box","text":"contracts to hedge against the increased cost resulting from an increase in the market value of","page_number":354,"box":{"x":116,"y":661,"width":703,"height":12}},{"id":"372f53d8-3de6-44fd-90e4-78b5c1d3e091","block_type":"box","text":"securities which the Fund intends to purchase.","page_number":354,"box":{"x":116,"y":676,"width":344,"height":12}},{"id":"91760659-f88b-4d85-89f8-0588d2bf7db7","block_type":"box","text":"To maintain greater flexibility, a Fund may invest in instruments which have characteristics similar to","page_number":354,"box":{"x":116,"y":707,"width":743,"height":12}},{"id":"08ade88d-db44-4fcd-b36c-611362cd6d60","block_type":"box","text":"futures contracts. These instruments may take a variety of forms, such as debt securities with interest","page_number":354,"box":{"x":116,"y":723,"width":754,"height":12}},{"id":"295f0684-1a05-44e6-8ee4-c0b6cde9b971","block_type":"box","text":"or principal payments determined by reference to the value of a security, an index of securities or a","page_number":354,"box":{"x":116,"y":738,"width":735,"height":12}},{"id":"4abc34c8-5c7d-4103-9d06-1e4121dc31dd","block_type":"box","text":"commodity at a future point in time. The risks of such investments could reflect the risks of investing in","page_number":354,"box":{"x":116,"y":754,"width":758,"height":12}},{"id":"b18855f3-db5c-4442-bbf0-8c7b615f51f2","block_type":"box","text":"futures and securities, including volatility and illiquidity.","page_number":354,"box":{"x":116,"y":769,"width":404,"height":12}},{"id":"6a556425-12ef-45a5-a422-cb9fc5f56bd7","block_type":"box","text":"Futures contracts and options on futures contracts are subject to significant correlation risk, leverage","page_number":354,"box":{"x":117,"y":800,"width":746,"height":12}},{"id":"23c09647-1f3c-4b3f-bcac-6e2aa3b5f4ec","block_type":"box","text":"risk, illiquidity risk, market risk and counterparty risk with respect to a Fund’s futures broker or the","page_number":354,"box":{"x":117,"y":816,"width":721,"height":12}},{"id":"826760a3-8cc2-43db-979f-49cd96a0cf1d","block_type":"box","text":"clearinghouse. See “— Risk Factors in Derivatives” above.","page_number":354,"box":{"x":116,"y":831,"width":440,"height":12}},{"id":"95167bce-059c-4618-a3fb-6fa7c5cfe1e2","block_type":"box","text":"Certain Funds may invest in futures based on carbon “allowances.” Under certain regulatory regimes, a","page_number":354,"box":{"x":117,"y":862,"width":771,"height":12}},{"id":"37ff1c6b-26b5-4ecd-bc5c-ba04fe348364","block_type":"box","text":"limit is set by a regulator, such as a government entity, on the total amount of specific greenhouse","page_number":354,"box":{"x":117,"y":878,"width":732,"height":12}},{"id":"4b283d10-ef28-439b-9f94-b196b2cbd80c","block_type":"box","text":"II-22","page_number":354,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"1c1dc9c3-dede-4ebc-b82e-c958115aa161","block_type":"box","text":"NM1026U-6004382-354/605","page_number":354,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3c9a34aa-810a-4cd4-824e-2bacb6a92ec1","block_type":"box","text":"gases, such as CO2, that can be emitted by regulated entities, such as manufacturers or energy","page_number":355,"box":{"x":116,"y":87,"width":720,"height":12}},{"id":"2cfdbba0-be3b-483a-8ce1-986d8eaddf09","block_type":"box","text":"producers. The regulator then may issue or sell individual “emission allowances” to regulated entities,","page_number":355,"box":{"x":117,"y":102,"width":756,"height":13}},{"id":"0d3aa72e-cf6c-429d-a58b-96c7aee374ce","block_type":"box","text":"which can then be traded on the open market. Commodity futures contracts linked to the value of","page_number":355,"box":{"x":116,"y":118,"width":725,"height":12}},{"id":"4583f17b-2f0c-4d50-9218-8502f9fcf190","block_type":"box","text":"emission allowances are known as “carbon futures.”","page_number":355,"box":{"x":116,"y":134,"width":392,"height":9}},{"id":"f04fd49d-86a5-41de-8370-6cab5465179b","block_type":"box","text":"The price for carbon futures contracts is based on a number of factors, including the supply of and the","page_number":355,"box":{"x":116,"y":166,"width":762,"height":12}},{"id":"7cb28bf5-9ba2-4ad1-8053-4c6011c90976","block_type":"box","text":"demand for carbon futures contracts. Changes in law, market conditions and expectations, position","page_number":355,"box":{"x":116,"y":182,"width":740,"height":12}},{"id":"78ae226d-8a05-4940-9c14-a581dc224d8a","block_type":"box","text":"limits, collateral requirements, and other factors each can impact the supply of and demand for carbon","page_number":355,"box":{"x":117,"y":197,"width":763,"height":12}},{"id":"623c6bd9-3cc2-43f5-97ec-d4c68d58139c","block_type":"box","text":"futures contracts. The market for carbon futures contracts is still developing and may be subject to","page_number":355,"box":{"x":116,"y":213,"width":735,"height":12}},{"id":"ce78ffba-f88e-42fb-bbf9-4f146385f2dd","block_type":"box","text":"periods of illiquidity. During such times it may be difficult or impossible to buy or sell a position at the","page_number":355,"box":{"x":117,"y":228,"width":747,"height":12}},{"id":"8b7355e1-1cb8-4f98-af60-a556bda3bc20","block_type":"box","text":"desired price. Market disruptions or volatility can also make it difficult to find a counterparty willing to","page_number":355,"box":{"x":116,"y":244,"width":747,"height":12}},{"id":"340a4c87-3464-4049-976e-e9114f98fcdc","block_type":"box","text":"transact at a reasonable price and sufficient size.","page_number":355,"box":{"x":116,"y":259,"width":369,"height":12}},{"id":"a993d7c3-1f09-4e44-92da-709628f3e2f9","block_type":"box","text":"Swap Agreements.","page_number":355,"box":{"x":117,"y":292,"width":145,"height":12}},{"id":"2d025fa4-1577-4fd9-ad47-2f8196d37548","block_type":"box","text":"A Fund may enter into swap agreements for hedging purposes or speculative purposes. Swap","page_number":355,"box":{"x":116,"y":316,"width":704,"height":12}},{"id":"901c3fc9-7554-4b0e-87bb-149db1ca5d3a","block_type":"box","text":"agreements are OTC contracts entered into primarily by financial institutions and institutional investors","page_number":355,"box":{"x":116,"y":332,"width":764,"height":12}},{"id":"ade27be9-3032-4dde-b1e7-ce86b56e9d4c","block_type":"box","text":"which may or may not be cleared by a central clearinghouse. In a standard “swap” transaction, two","page_number":355,"box":{"x":116,"y":347,"width":738,"height":12}},{"id":"365b2c89-b301-4afa-a85e-f8af921ef718","block_type":"box","text":"parties agree to exchange the returns earned or realized from one or more underlying assets or rates","page_number":355,"box":{"x":117,"y":363,"width":755,"height":12}},{"id":"0fe8866c-8a99-46ad-89df-118d55e3de30","block_type":"box","text":"of return, which may be adjusted for an interest factor. The gross returns to be exchanged or","page_number":355,"box":{"x":116,"y":378,"width":693,"height":12}},{"id":"d522c32a-6c41-49fa-8c7e-839a72a9d622","block_type":"box","text":"“swapped” between the parties are generally calculated with respect to a “notional amount,”","page_number":355,"box":{"x":116,"y":394,"width":684,"height":12}},{"id":"00bc3827-9e1e-4b46-9d44-6da8ff680c9b","block_type":"box","text":"e.g.","page_number":355,"box":{"x":801,"y":396,"width":26,"height":10}},{"id":"99b84018-2534-4eb4-aa51-d95832420a37","block_type":"box","text":", the","page_number":355,"box":{"x":830,"y":394,"width":36,"height":11}},{"id":"68ed00ff-2a76-40fb-a001-1b8169239cf0","block_type":"box","text":"return or increase in value of a particular dollar amount invested at a particular interest rate, in a","page_number":355,"box":{"x":117,"y":409,"width":716,"height":12}},{"id":"f82abb2c-98fc-4acc-a3e2-719298a5b88c","block_type":"box","text":"particular foreign currency, or in a “basket” of securities representing a particular index. The notional","page_number":355,"box":{"x":117,"y":425,"width":747,"height":12}},{"id":"22c8fe18-12d6-480a-9c11-f186a754fd0d","block_type":"box","text":"amount of the swap agreement is only used to calculate the obligations that the parties to a swap","page_number":355,"box":{"x":116,"y":440,"width":726,"height":12}},{"id":"a29c47f8-c5e6-4ce8-97a2-5f3646b7062e","block_type":"box","text":"agreement have agreed to exchange. A Fund’s obligations (or rights) under a swap agreement will","page_number":355,"box":{"x":116,"y":456,"width":736,"height":12}},{"id":"21f0dbed-1c37-44f0-b0fe-aa9927420e57","block_type":"box","text":"generally be equal only to the net amount to be paid or received under the agreement based on the","page_number":355,"box":{"x":116,"y":471,"width":743,"height":12}},{"id":"c7d2edca-6ac3-4b3d-9119-96980742e154","block_type":"box","text":"relative values of the positions held by each party to the agreement. Swaps that are not cleared involve","page_number":355,"box":{"x":117,"y":487,"width":770,"height":12}},{"id":"60754667-3d23-46f6-ae43-75e24dc2e0a0","block_type":"box","text":"substantial counterparty risk. A Fund will typically attempt to mitigate this counterparty risk by entering","page_number":355,"box":{"x":116,"y":502,"width":761,"height":12}},{"id":"d89d9ff1-8759-40b3-aaa7-5f8c3e47304a","block_type":"box","text":"into swap agreements only with creditworthy entities that have substantial capital or that have provided","page_number":355,"box":{"x":117,"y":518,"width":767,"height":12}},{"id":"4dc51b14-8d41-4449-90cf-369bb2da5a47","block_type":"box","text":"the Fund with a third-party guaranty or other credit support. A Fund’s ability to use swap agreements","page_number":355,"box":{"x":116,"y":533,"width":751,"height":12}},{"id":"9bbbf87d-be85-4f28-bfb8-b5b746c29d2b","block_type":"box","text":"may be restricted by the tax rules applicable to registered investment companies.","page_number":355,"box":{"x":117,"y":549,"width":607,"height":12}},{"id":"c779600b-c1f0-4f20-b1ce-d1f68b033fc6","block_type":"box","text":"Credit Default Swaps and Similar Instruments.","page_number":355,"box":{"x":117,"y":581,"width":348,"height":12}},{"id":"8d1f758c-a2a5-4434-bda8-fb1923c66da1","block_type":"box","text":"Certain Funds may enter into credit default swaps and","page_number":355,"box":{"x":466,"y":581,"width":407,"height":12}},{"id":"0c5eee7e-05ad-44ea-a4b3-64f003976dc1","block_type":"box","text":"similar instruments. Credit default swaps are standardized agreements in which the protection “buyer”","page_number":355,"box":{"x":116,"y":597,"width":760,"height":12}},{"id":"c85496b6-ff6e-4681-bba2-dd3a1e76764c","block_type":"box","text":"pays the protection “seller” an up-front payment, or a periodic stream of payments, over the term of the","page_number":355,"box":{"x":117,"y":612,"width":768,"height":12}},{"id":"bc6fae0a-9edf-4a79-9e92-120984d931bf","block_type":"box","text":"contract, provided generally that no credit event on a reference obligation has occurred. If a credit","page_number":355,"box":{"x":116,"y":628,"width":730,"height":12}},{"id":"0065571a-45cf-4e2d-8e2b-941d7a4929bb","block_type":"box","text":"event occurs, the seller generally must pay the buyer the difference between the notional amount of","page_number":355,"box":{"x":116,"y":643,"width":745,"height":12}},{"id":"f9985bb1-a4d6-437e-b001-e9835e0f2a82","block_type":"box","text":"the contract and the value of a portfolio of securities issued by the reference entity. A Fund may be","page_number":355,"box":{"x":116,"y":659,"width":738,"height":12}},{"id":"2e9f66b1-b314-42b4-9eb6-78b672aeb77f","block_type":"box","text":"either the buyer or seller in the transaction. The Funds may enter into credit default swaps that","page_number":355,"box":{"x":116,"y":674,"width":701,"height":12}},{"id":"e9aabff0-7b03-428f-9dbc-ec995d11fdf1","block_type":"box","text":"reference the obligations of a single entity (“single-name CDS”) or the obligations of entities that make","page_number":355,"box":{"x":117,"y":690,"width":756,"height":12}},{"id":"877984de-8683-4f81-b5e8-75367d641772","block_type":"box","text":"up an index (“index CDS”). References to “credit default swaps” shall collectively refer to single-name","page_number":355,"box":{"x":117,"y":705,"width":751,"height":12}},{"id":"45ecf77e-b262-4238-9b6f-3a662966ce6f","block_type":"box","text":"CDS and index CDS.","page_number":355,"box":{"x":117,"y":721,"width":155,"height":9}},{"id":"6ad316aa-c384-4a95-8e83-615d7a31c0f8","block_type":"box","text":"Credit default swaps have as reference obligations one or more securities or loans that are not","page_number":355,"box":{"x":117,"y":753,"width":701,"height":13}},{"id":"1dee992e-ce23-47c7-b4d1-5ab76b80ece5","block_type":"box","text":"currently held by a Fund. In circumstances in which a Fund does not own the securities or loans that","page_number":355,"box":{"x":116,"y":769,"width":744,"height":12}},{"id":"13a88a61-154f-4b8b-91fc-01ffac65dfb5","block_type":"box","text":"are deliverable under a credit default swap, the Fund is exposed to the risk that deliverable securities","page_number":355,"box":{"x":116,"y":784,"width":749,"height":12}},{"id":"ff735bbd-8f57-4a39-9e6c-c55bb498e7c3","block_type":"box","text":"will not be available in the market, or will be available only at unfavorable prices, as would be the case","page_number":355,"box":{"x":116,"y":800,"width":758,"height":12}},{"id":"5f49c231-83c5-4fab-905f-9090350f3f4c","block_type":"box","text":"in a so-called “short squeeze.” In certain instances of issuer defaults or restructurings, it has been","page_number":355,"box":{"x":117,"y":815,"width":723,"height":13}},{"id":"9b6290e9-f130-43b8-a779-a7ffc86e70e5","block_type":"box","text":"unclear under the standard industry documentation for credit default swaps whether or not a “credit","page_number":355,"box":{"x":117,"y":831,"width":739,"height":12}},{"id":"735468dd-f099-4122-ab9a-415de8a86f9b","block_type":"box","text":"event” triggering the seller’s payment obligation had occurred. Certain initiatives adopted by derivatives","page_number":355,"box":{"x":116,"y":846,"width":771,"height":13}},{"id":"408362fd-216d-4ae0-a18e-3b1a31b19bd5","block_type":"box","text":"market participants, including the International Swaps and Derivatives Association (“ISDA”), are","page_number":355,"box":{"x":117,"y":862,"width":713,"height":12}},{"id":"85768137-448a-496e-be61-3baa784efa17","block_type":"box","text":"designed to implement uniform settlement terms into standard credit default swap documentation, as","page_number":355,"box":{"x":116,"y":877,"width":753,"height":13}},{"id":"5d0a417f-d7b4-41e4-9e7f-98cc9811e21e","block_type":"box","text":"II-23","page_number":355,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"63b46da0-05d0-46a9-ba57-f7e254be53f1","block_type":"box","text":"NM1026U-6004382-355/605","page_number":355,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"96919e82-8fa3-4f29-9307-da442611d48e","block_type":"box","text":"well as refine the practices for the transparent conduct of the credit default swap market generally.","page_number":356,"box":{"x":116,"y":87,"width":735,"height":12}},{"id":"dec31630-f1d6-4cc1-a62a-205604d967f3","block_type":"box","text":"Among these initiatives are the ISDA Credit Derivatives Determination Committee and the","page_number":356,"box":{"x":116,"y":102,"width":672,"height":13}},{"id":"7cd7596b-54b4-49f1-b177-dc355220c787","block_type":"box","text":"implementation of market-wide cash settlement protocols applicable to all market-standard credit","page_number":356,"box":{"x":117,"y":118,"width":722,"height":12}},{"id":"06b48155-06dc-4320-a4eb-3ed9cd32d102","block_type":"box","text":"default swaps. These initiatives are intended to reduce both the uncertainty as to the occurrence of","page_number":356,"box":{"x":116,"y":134,"width":739,"height":12}},{"id":"077648ff-3bee-4853-8a02-14a73b3d79db","block_type":"box","text":"credit events and the risk of a “short squeeze” by providing that the ISDA Credit Derivatives","page_number":356,"box":{"x":116,"y":149,"width":684,"height":12}},{"id":"a91a8d3b-98ae-46a9-83fb-7ce8aa313d74","block_type":"box","text":"Determinations Committee will make determinations as to whether a credit event has occurred,","page_number":356,"box":{"x":117,"y":165,"width":710,"height":11}},{"id":"9056140f-291f-4f8b-9905-8115d5bb9e3e","block_type":"box","text":"establish an auction to determine a settlement price and identify the deliverable securities for purposes","page_number":356,"box":{"x":116,"y":180,"width":768,"height":12}},{"id":"303211a3-c3e3-4858-b8c6-b19f3853f581","block_type":"box","text":"of the auction, although the ISDA Credit Derivatives Determinations Committee may in certain limited","page_number":356,"box":{"x":116,"y":196,"width":756,"height":12}},{"id":"3cb1bdfb-96ab-41b0-8d25-6ec42091b7fb","block_type":"box","text":"circumstances refrain from doing so. In the event the ISDA Credit Derivatives Determinations","page_number":356,"box":{"x":116,"y":211,"width":696,"height":12}},{"id":"df9537b9-e5a1-4ce6-9716-d3e0330d7e1d","block_type":"box","text":"Committee cannot reach a timely resolution with respect to a “credit event” or otherwise does not","page_number":356,"box":{"x":117,"y":227,"width":723,"height":12}},{"id":"729ea9e1-f44e-4ce1-b5b7-3d161c402e3f","block_type":"box","text":"establish a cash settlement auction, a Fund may not be able to realize the full value of the credit","page_number":356,"box":{"x":116,"y":242,"width":717,"height":12}},{"id":"82261dea-f626-4419-863d-07a42c052672","block_type":"box","text":"default swap upon a default by the reference entity. Furthermore, a Fund may enter into certain credit","page_number":356,"box":{"x":116,"y":258,"width":758,"height":12}},{"id":"1dfe43b1-2411-49a7-abd0-a1af6010c640","block_type":"box","text":"default swaps or similar instruments that may not be covered by these initiatives.","page_number":356,"box":{"x":116,"y":273,"width":604,"height":12}},{"id":"8c06e340-89cd-4bae-8302-a40c68288442","block_type":"box","text":"If a Fund is a buyer, it will lose the payments made under the terms of the credit default swap and","page_number":356,"box":{"x":117,"y":304,"width":729,"height":12}},{"id":"7acfe1f8-9388-40c1-a3b0-fd0c59419a14","block_type":"box","text":"recover nothing should no credit event occur. If a Fund is a seller and a credit event occurs, the value","page_number":356,"box":{"x":117,"y":320,"width":757,"height":12}},{"id":"4dad5832-07ef-4167-9ca3-c366db409976","block_type":"box","text":"of any deliverable obligation received by the Fund or the amount of cash settlement received by the","page_number":356,"box":{"x":116,"y":335,"width":744,"height":12}},{"id":"f0dcceab-f283-43e3-a332-c20f1d2a0d1b","block_type":"box","text":"Fund pursuant to the relevant cash settlement auction, together with the up-front or periodic payments","page_number":356,"box":{"x":117,"y":351,"width":763,"height":12}},{"id":"748aad96-842a-441a-84a0-bfd677815232","block_type":"box","text":"previously received, may be less than the amount it pays to the buyer, resulting in a loss of value to the","page_number":356,"box":{"x":117,"y":366,"width":770,"height":12}},{"id":"b68c49fb-d733-430d-9f84-95e3abbda2e7","block_type":"box","text":"Fund. A Fund that sells credit default swaps incurs leveraged exposure to the credit of one or more","page_number":356,"box":{"x":117,"y":382,"width":739,"height":12}},{"id":"59763702-9151-44f1-8c32-2b6804c134c9","block_type":"box","text":"reference entities and is subject to many of the same risks it would incur if it were holding debt","page_number":356,"box":{"x":117,"y":397,"width":703,"height":12}},{"id":"17fb8407-3776-46d1-995f-c1cbd696a402","block_type":"box","text":"securities issued by the relevant reference entity. However, a Fund will not have any legal recourse","page_number":356,"box":{"x":116,"y":413,"width":742,"height":12}},{"id":"55b3f4a2-8bab-46e4-8ad2-d4792e39170a","block_type":"box","text":"against any reference entity and will not benefit from any collateral securing the reference entity’s debt","page_number":356,"box":{"x":116,"y":428,"width":764,"height":12}},{"id":"58ee4c80-3328-45f2-8a8b-ff7da70c2453","block_type":"box","text":"obligations. In the event the ISDA Credit Derivatives Determinations Committee does not establish a","page_number":356,"box":{"x":116,"y":444,"width":750,"height":12}},{"id":"a197152d-f7aa-48b3-b9f2-12ea127a7d9a","block_type":"box","text":"cash settlement auction and identify the relevant deliverable securities or loans, the credit default swap","page_number":356,"box":{"x":116,"y":459,"width":769,"height":12}},{"id":"769b5c39-dd4f-46a8-9b3f-0ce15e6ee187","block_type":"box","text":"buyer will have broad discretion to select which of the reference entity’s debt obligations to deliver to","page_number":356,"box":{"x":117,"y":475,"width":748,"height":12}},{"id":"c5b86359-1fba-4539-bce8-c77cc234de09","block_type":"box","text":"the Fund following a credit event and will likely choose the obligations with the lowest market value in","page_number":356,"box":{"x":116,"y":490,"width":755,"height":12}},{"id":"b6605b14-845d-4998-bc22-0f5a4280da29","block_type":"box","text":"order to maximize the payment obligations of the Fund. In addition, credit default swaps generally trade","page_number":356,"box":{"x":116,"y":506,"width":772,"height":12}},{"id":"2c2b5289-07b1-493c-b08f-28e45b76948c","block_type":"box","text":"on the basis of theoretical pricing and valuation models, which may not accurately value such swap","page_number":356,"box":{"x":116,"y":521,"width":742,"height":12}},{"id":"7bd50f9c-5483-44eb-be56-21e2d6b3cd76","block_type":"box","text":"positions when established or when subsequently traded or unwound under actual market conditions.","page_number":356,"box":{"x":117,"y":537,"width":756,"height":12}},{"id":"8afc7624-aa64-4e0c-9a9f-9727bf997aac","block_type":"box","text":"Dodd-Frank requires that certain index CDS be executed in regulated markets and submitted for","page_number":356,"box":{"x":117,"y":568,"width":719,"height":12}},{"id":"6d3b4751-72fd-4ea4-ad8c-9365dcc0bb67","block_type":"box","text":"clearing to regulated clearinghouses. See “— Derivatives — Regulation of Derivatives — Dodd-Frank","page_number":356,"box":{"x":116,"y":583,"width":757,"height":12}},{"id":"f8d4736c-de0a-4e21-bb34-a0b137a70104","block_type":"box","text":"Regulations” above. Other single-name CDS and index CDS are permitted, although not required, to","page_number":356,"box":{"x":117,"y":599,"width":750,"height":12}},{"id":"20d7e30c-5932-456d-b8ab-95a889691dda","block_type":"box","text":"be cleared through regulated clearinghouses. The Funds clear all credit default swaps that are subject","page_number":356,"box":{"x":117,"y":614,"width":762,"height":12}},{"id":"91d564f2-ea25-43e2-8169-c17fecfc0b2b","block_type":"box","text":"to mandatory clearing and may voluntarily clear some, but not all, of the other credit default swaps not","page_number":356,"box":{"x":116,"y":630,"width":762,"height":12}},{"id":"30d3fd5f-ff7b-4bec-a314-54928fd3f1a9","block_type":"box","text":"subject to mandatory clearing. The Funds face counterparty risk with respect to the clearinghouse","page_number":356,"box":{"x":116,"y":645,"width":731,"height":12}},{"id":"89491b12-2e4c-4478-b6f5-7d1666d16269","block_type":"box","text":"when entering into cleared single-name CDS and cleared index CDS. The Funds face significant","page_number":356,"box":{"x":116,"y":661,"width":717,"height":12}},{"id":"cd3ae408-24c7-444a-aca6-888c1607737f","block_type":"box","text":"counterparty risk with respect to their counterparties to non-cleared credit default swaps and similar","page_number":356,"box":{"x":116,"y":676,"width":738,"height":12}},{"id":"b763b849-f686-4d3b-8eaa-aa7ca89eb22a","block_type":"box","text":"instruments. A Fund typically will enter into non-cleared credit default swaps and similar instruments","page_number":356,"box":{"x":117,"y":692,"width":741,"height":12}},{"id":"be6a8226-d1da-4b14-9def-ad6eb132abbc","block_type":"box","text":"with swap dealers and creditworthy entities that have substantial capital or that have provided the Fund","page_number":356,"box":{"x":116,"y":707,"width":765,"height":12}},{"id":"a861bac4-e81c-4fc1-b03c-ac1843be8bbc","block_type":"box","text":"with a third-party guaranty or other credit support.","page_number":356,"box":{"x":116,"y":723,"width":367,"height":12}},{"id":"ba8e245d-6fb1-46de-8dbc-7975bac4854c","block_type":"box","text":"In certain instances, a Fund may enter into bespoke credit default swaps or similar instruments either","page_number":356,"box":{"x":117,"y":754,"width":750,"height":12}},{"id":"ff697430-a3aa-4b40-baf3-e07f049b8e74","block_type":"box","text":"as protection buyer or protection seller. While these contracts are similar in their operation to the","page_number":356,"box":{"x":116,"y":769,"width":715,"height":12}},{"id":"38e5979a-0eac-44a3-9a4e-fed73324ae69","block_type":"box","text":"market-standard credit default swaps described above, they are less standardized and instead have","page_number":356,"box":{"x":117,"y":785,"width":741,"height":12}},{"id":"b5a65a41-619f-4bcd-b654-b72604fe0ca5","block_type":"box","text":"bespoke or tailored features. For example, as compared to market-standard credit defaults, the range","page_number":356,"box":{"x":117,"y":800,"width":753,"height":12}},{"id":"8335ab13-8ae9-4ed0-9b57-d05b19bb6ef5","block_type":"box","text":"of “credit events” triggering settlement of such bespoke contracts may be narrower or broader, any","page_number":356,"box":{"x":116,"y":816,"width":733,"height":12}},{"id":"83436607-aa14-44dd-80c9-d66db20f3ed9","block_type":"box","text":"such triggered contracts are settled by physical delivery of the underlying security or loan to or by the","page_number":356,"box":{"x":116,"y":831,"width":755,"height":12}},{"id":"d3d180f0-384b-423c-91cc-9e0298105bde","block_type":"box","text":"Fund rather than by way of cash settlement, and there may be a wider range of securities as the","page_number":356,"box":{"x":117,"y":847,"width":719,"height":12}},{"id":"f6a78ab9-3b10-42c9-9ce0-937ddfe75df0","block_type":"box","text":"reference obligations and/or deliverable obligations.","page_number":356,"box":{"x":117,"y":862,"width":388,"height":12}},{"id":"d124f046-65da-4c78-95c9-5425e4930afe","block_type":"box","text":"II-24","page_number":356,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"9ad7e82e-7844-442c-b8b0-99cb942b868b","block_type":"box","text":"NM1026U-6004382-356/605","page_number":356,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"737532fc-5406-4e3b-92ba-fc203fc3fb86","block_type":"box","text":"In addition, credit default swaps and similar instruments generally involve greater risks than if a Fund","page_number":357,"box":{"x":117,"y":87,"width":752,"height":12}},{"id":"b017e707-5fdd-4633-8a89-c6bfb739776a","block_type":"box","text":"had invested in the reference obligation directly and are subject to significant credit risk, correlation","page_number":357,"box":{"x":117,"y":102,"width":738,"height":13}},{"id":"47d34d5a-5756-4c53-b74d-1e7fa613baa4","block_type":"box","text":"risk, leverage risk, illiquidity risk and market risk. See “— Risk Factors in Derivatives” above.","page_number":357,"box":{"x":117,"y":118,"width":689,"height":12}},{"id":"97ec76e7-1a35-4e38-a445-93f536efae54","block_type":"box","text":"Interest Rate Swaps, Floors and Caps.","page_number":357,"box":{"x":117,"y":151,"width":292,"height":12}},{"id":"0cb61885-aae3-4214-a23d-00337b4117d4","block_type":"box","text":"Certain Funds may enter into OTC derivatives in the form of","page_number":357,"box":{"x":410,"y":151,"width":450,"height":12}},{"id":"9bcb2389-473d-48a8-951c-96e88d68107c","block_type":"box","text":"interest rate swaps and interest rate caps and floors. As described in further detail below, a Fund may","page_number":357,"box":{"x":117,"y":167,"width":760,"height":12}},{"id":"b057beb7-97c4-402e-ad27-13f3894a0181","block_type":"box","text":"enter into these transactions primarily to preserve a return or spread on a particular investment or","page_number":357,"box":{"x":116,"y":182,"width":729,"height":12}},{"id":"f3e279bd-bd60-44f8-93a3-4ed65fe509a5","block_type":"box","text":"portion of its holdings, as a duration management technique, to protect against an increase in the price","page_number":357,"box":{"x":117,"y":198,"width":767,"height":12}},{"id":"92f8acc7-0827-4eb8-8853-608f4fa5e520","block_type":"box","text":"of securities a Fund anticipates purchasing at a later date, or for speculation to increase returns.","page_number":357,"box":{"x":116,"y":213,"width":718,"height":12}},{"id":"0d9f36f9-1a8e-4275-9f7e-600589be839c","block_type":"box","text":"Dodd-Frank requires that certain interest rate swaps be executed in regulated markets and submitted","page_number":357,"box":{"x":117,"y":247,"width":756,"height":12}},{"id":"4fe362b1-d1a1-448f-bf80-70ec582208ba","block_type":"box","text":"for clearing to regulated clearinghouses. See “— Regulation of Derivatives — Dodd-Frank Regulations”","page_number":357,"box":{"x":116,"y":262,"width":771,"height":12}},{"id":"cbe0c1e2-2064-4a12-9db5-01b7a379839e","block_type":"box","text":"above. Other interest rate swaps are permitted, although not required, to be cleared. Most of the","page_number":357,"box":{"x":116,"y":277,"width":720,"height":13}},{"id":"cb78c05d-4199-4d83-8c19-17442123769d","block_type":"box","text":"interest rate swaps entered into by the Funds are cleared. The Funds face counterparty risk with","page_number":357,"box":{"x":117,"y":293,"width":719,"height":12}},{"id":"e24bf477-7a8f-41bf-b1f0-45d93ccc5849","block_type":"box","text":"respect to the clearinghouse when entering into cleared interest rate swaps.","page_number":357,"box":{"x":117,"y":309,"width":568,"height":12}},{"id":"b71465f1-8848-40fb-8462-c0823ec6079c","block_type":"box","text":"The Funds face significant counterparty risk with respect to their counterparties to non-cleared interest","page_number":357,"box":{"x":116,"y":342,"width":764,"height":12}},{"id":"6a82f697-a5df-483e-952d-62b25370c35e","block_type":"box","text":"rate swaps and interest rate caps and floors. The typical counterparties for a Fund’s non-cleared","page_number":357,"box":{"x":117,"y":357,"width":719,"height":12}},{"id":"c080a5df-fedf-4f82-8deb-20a69de2e0a1","block_type":"box","text":"interest rate derivatives transactions are swap dealers and other creditworthy entities that have","page_number":357,"box":{"x":117,"y":373,"width":709,"height":12}},{"id":"1d5cee83-eaa4-4d07-9887-0b580be23283","block_type":"box","text":"substantial capital or that have provided the Fund with a third-party guaranty or other credit support. If","page_number":357,"box":{"x":116,"y":388,"width":760,"height":12}},{"id":"c5ea388e-12df-4d24-b987-81a5584b7a0e","block_type":"box","text":"the Fund’s counterparty defaults on such a transaction, a Fund will have contractual remedies with","page_number":357,"box":{"x":116,"y":404,"width":736,"height":12}},{"id":"5fd24c92-f986-4429-a1cd-b6d527477516","block_type":"box","text":"respect to the transaction, but there can be no guarantee that the Fund will be successful in enforcing","page_number":357,"box":{"x":117,"y":419,"width":758,"height":12}},{"id":"5a435fa4-5f05-4e91-a1c4-e85daa86b4d3","block_type":"box","text":"such remedies. The market for interest rate swaps is relatively liquid in comparison with other similar","page_number":357,"box":{"x":116,"y":435,"width":751,"height":12}},{"id":"1a259591-8fd4-4432-8970-999a40483bec","block_type":"box","text":"instruments traded in the interbank market. A Fund may be limited in its ability to enter into certain","page_number":357,"box":{"x":117,"y":450,"width":732,"height":12}},{"id":"36fed449-2edb-465a-af43-1102d60b60c5","block_type":"box","text":"interest rate derivatives due to applicable income tax requirements.","page_number":357,"box":{"x":117,"y":466,"width":503,"height":12}},{"id":"f661ebf7-5691-4e61-a258-9c743ac37023","block_type":"box","text":"Interest rate swaps are transactions in which each party makes periodic interest payments based on a","page_number":357,"box":{"x":117,"y":499,"width":762,"height":12}},{"id":"d90e0ea9-e1ca-4114-a041-b6a7e78897bb","block_type":"box","text":"fixed or variable interest rate, index or asset in return for periodic payments from its counterparty based","page_number":357,"box":{"x":116,"y":514,"width":772,"height":12}},{"id":"4f943e47-d91a-4846-9aa4-dad18479fcd9","block_type":"box","text":"on a different fixed or variable interest rate, index or asset.","page_number":357,"box":{"x":116,"y":530,"width":439,"height":11}},{"id":"947d1385-f293-4e31-9cd5-875995d07b3c","block_type":"box","text":"The purchase of an interest rate floor entitles the purchaser, to the extent that a specified index falls","page_number":357,"box":{"x":116,"y":563,"width":746,"height":12}},{"id":"b4f0c18a-6051-41da-a1fa-24ec3ce112cd","block_type":"box","text":"below a predetermined interest rate, to receive payments of interest on a notional principal amount","page_number":357,"box":{"x":117,"y":579,"width":736,"height":12}},{"id":"778de0ea-0534-470a-8dcc-6acda7514e93","block_type":"box","text":"from the party selling such interest rate floor.","page_number":357,"box":{"x":116,"y":594,"width":337,"height":12}},{"id":"2afdf243-a1e0-4ff2-9379-77ba8ae858a5","block_type":"box","text":"The purchase of an interest rate cap entitles the purchaser, to the extent that a specified index rises","page_number":357,"box":{"x":116,"y":627,"width":746,"height":12}},{"id":"7aaa9a7b-953b-4a99-9b2f-c52766405d89","block_type":"box","text":"above a predetermined interest rate, to receive payments of interest on a notional principal amount","page_number":357,"box":{"x":116,"y":643,"width":739,"height":12}},{"id":"d85c592d-5b66-490e-92dd-cf6b30fd4288","block_type":"box","text":"from the party selling such interest rate cap.","page_number":357,"box":{"x":116,"y":658,"width":331,"height":12}},{"id":"247cd0f7-a0e8-49fb-94b1-bb860d7d5cff","block_type":"box","text":"A Fund may enter into an interest rate swap to effectively exchange with another party their respective","page_number":357,"box":{"x":116,"y":692,"width":759,"height":12}},{"id":"2e135dd6-59cc-4da3-b057-45e18b1245f6","block_type":"box","text":"commitments to pay or receive interest,","page_number":357,"box":{"x":116,"y":707,"width":292,"height":12}},{"id":"c344d384-ae7e-4222-89cf-c5cf63d980a9","block_type":"box","text":"e.g.","page_number":357,"box":{"x":415,"y":710,"width":26,"height":9}},{"id":"4210f132-297c-427e-8a6a-66ccaa03af6b","block_type":"box","text":", an exchange of fixed rate payments for floating rate","page_number":357,"box":{"x":444,"y":707,"width":391,"height":12}},{"id":"31e3f63e-6894-4748-a889-5e7f4647ed1f","block_type":"box","text":"payments. For example, if a Fund holds a mortgage-backed security with an interest rate that is reset","page_number":357,"box":{"x":117,"y":723,"width":750,"height":12}},{"id":"c28a1917-e018-4cf0-a096-e5ae1320ad62","block_type":"box","text":"only once each year, it may swap the right to receive interest at this fixed rate for the right to receive","page_number":357,"box":{"x":116,"y":738,"width":743,"height":12}},{"id":"c81dc16d-44c1-4985-aabc-c6659463236a","block_type":"box","text":"interest at a rate that is reset every week. This would enable a Fund to offset a decline in the value of","page_number":357,"box":{"x":117,"y":754,"width":751,"height":12}},{"id":"e53eee3b-e89b-4d21-a275-62dc883431da","block_type":"box","text":"the mortgage-backed security due to rising interest rates but would also limit its ability to benefit from","page_number":357,"box":{"x":116,"y":769,"width":747,"height":12}},{"id":"835613aa-4eb8-4796-8152-f90c2fb15fa1","block_type":"box","text":"falling interest rates. Conversely, if a Fund holds a mortgage-backed security with an interest rate that","page_number":357,"box":{"x":116,"y":785,"width":756,"height":12}},{"id":"413d6580-1591-477a-a0d1-5de7569e39e6","block_type":"box","text":"is reset every week and it would like to lock in what","page_number":357,"box":{"x":117,"y":800,"width":378,"height":12}},{"id":"4b608a71-d998-4257-87e9-92ed85f65d5a","block_type":"box","text":"it believes to be a high interest rate for one year, it","page_number":357,"box":{"x":501,"y":800,"width":373,"height":12}},{"id":"78895bb1-da19-425b-acab-63610444b67f","block_type":"box","text":"may swap the right to receive interest at this variable weekly rate for the right to receive interest at a","page_number":357,"box":{"x":117,"y":816,"width":740,"height":12}},{"id":"c7bfad84-0f9b-4ad3-91b7-50126aa1caaf","block_type":"box","text":"rate that is fixed for one year. Such a swap would protect the Fund from a reduction in yield due to","page_number":357,"box":{"x":117,"y":831,"width":733,"height":12}},{"id":"1871211b-74e8-4b49-a8c3-5daa461c0352","block_type":"box","text":"falling interest rates and may permit the Fund to enhance its income through the positive differential","page_number":357,"box":{"x":116,"y":847,"width":745,"height":12}},{"id":"16439948-c305-4ae7-96de-175bb4eb3aa0","block_type":"box","text":"between one week and one year interest rates, but would preclude it from taking full advantage of","page_number":357,"box":{"x":117,"y":862,"width":729,"height":12}},{"id":"7a612c89-16ce-4bdf-aa00-20fc05a28e82","block_type":"box","text":"rising interest rates.","page_number":357,"box":{"x":117,"y":878,"width":150,"height":12}},{"id":"20ac50e3-1ec1-485b-b93a-c2b3c06a2792","block_type":"box","text":"II-25","page_number":357,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"f8600b52-14f2-4070-b24b-27393b949dc5","block_type":"box","text":"NM1026U-6004382-357/605","page_number":357,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"73453b3d-18d7-47a4-9435-9bf2acbce39d","block_type":"box","text":"Gains from transactions in interest rate swaps distributed to shareholders will be taxable as ordinary","page_number":358,"box":{"x":117,"y":87,"width":746,"height":12}},{"id":"8b1ab567-9b2d-442a-b3cc-94985c5c2a4e","block_type":"box","text":"income or, in certain circumstances, as long term capital gains to shareholders.","page_number":358,"box":{"x":117,"y":103,"width":593,"height":12}},{"id":"c3fdb91f-459f-46e7-954e-8962422cf8e6","block_type":"box","text":"Interest rate swaps and interest rate caps and floors may be subject to correlation risk, leverage risk,","page_number":358,"box":{"x":117,"y":134,"width":751,"height":13}},{"id":"db776885-7a47-4047-800a-ccdc978329a8","block_type":"box","text":"illiquidity risk and market risk. See “— Risk Factors in Derivatives” above.","page_number":358,"box":{"x":117,"y":150,"width":549,"height":12}},{"id":"06356ee5-c068-4c65-88be-9de9d786027b","block_type":"box","text":"Total Return Swaps.","page_number":358,"box":{"x":118,"y":182,"width":155,"height":12}},{"id":"9933c8e4-268e-4577-822d-6a45e3c4a5e4","block_type":"box","text":"Total return swaps are contracts in which one party agrees to make periodic","page_number":358,"box":{"x":273,"y":182,"width":570,"height":12}},{"id":"dea14d73-64cd-4907-9fbf-bcb9e3734760","block_type":"box","text":"payments to the other party based on the return of the assets underlying the contract in exchange for","page_number":358,"box":{"x":117,"y":197,"width":754,"height":13}},{"id":"e5fe65e6-e0e1-49b0-a121-4d2e1b4fe7df","block_type":"box","text":"periodic payments based on a fixed or variable interest rate or the total return from different underlying","page_number":358,"box":{"x":117,"y":213,"width":765,"height":12}},{"id":"cf0dbc82-2dc1-45c2-8a7b-fe308c5364e8","block_type":"box","text":"assets. The return of the assets underlying the contract includes both the income generated by the","page_number":358,"box":{"x":116,"y":228,"width":737,"height":13}},{"id":"d5b88fed-fedd-4a27-800f-da1863c004a8","block_type":"box","text":"asset and the change in market value of the asset. The asset underlying the contract may include a","page_number":358,"box":{"x":116,"y":244,"width":743,"height":12}},{"id":"e97c772b-c631-40b5-b525-f18b8cfe520d","block_type":"box","text":"specified security, basket of securities or securities indices. Total return swaps on a specified security,","page_number":358,"box":{"x":116,"y":259,"width":763,"height":13}},{"id":"b6b68cce-4bf9-4130-8bff-59a6142cb7ee","block_type":"box","text":"basket of securities or securities indices may sometimes be referred to as “contracts for difference.”","page_number":358,"box":{"x":117,"y":275,"width":743,"height":12}},{"id":"2142622b-778e-44c7-a128-1c5c7c5121a0","block_type":"box","text":"Total return swaps may be used to obtain exposure to a security or market without owning or taking","page_number":358,"box":{"x":116,"y":307,"width":744,"height":12}},{"id":"42931764-59a8-473d-bede-06e3e3e01034","block_type":"box","text":"physical custody of such security or investing directly in such market. Upon entering into a total return","page_number":358,"box":{"x":117,"y":322,"width":758,"height":13}},{"id":"97b2e016-4005-4169-b0c7-ba468a4360f1","block_type":"box","text":"swap, a Fund is required to deposit initial margin but the parties do not exchange the notional amount.","page_number":358,"box":{"x":116,"y":338,"width":763,"height":12}},{"id":"a199fb2a-3232-4750-afcd-a81716dd7938","block_type":"box","text":"As a result, total return swaps may effectively add leverage to the Fund’s portfolio because the Fund","page_number":358,"box":{"x":116,"y":353,"width":750,"height":13}},{"id":"945921d1-0958-4e43-a9b0-cf40a15150b2","block_type":"box","text":"would be subject to investment exposure on the notional amount of the swap.","page_number":358,"box":{"x":116,"y":369,"width":580,"height":12}},{"id":"fb2a7a48-b2aa-4cd8-a7ad-c1822a64cda5","block_type":"box","text":"Total return swaps are subject to significant correlation risk, leverage risk, illiquidity risk, market risk","page_number":358,"box":{"x":116,"y":401,"width":743,"height":12}},{"id":"a123ad92-03ac-4094-8f07-c680cb2d40c9","block_type":"box","text":"and counterparty risk. See “— Risk Factors in Derivatives” above.","page_number":358,"box":{"x":116,"y":416,"width":493,"height":13}},{"id":"21c90150-9ab6-4702-8c19-b289193f6624","block_type":"box","text":"Options.","page_number":358,"box":{"x":117,"y":448,"width":66,"height":12}},{"id":"a9255a87-b1ad-40ae-8eed-a18acd34261e","block_type":"box","text":"Options on Securities and Securities Indices.","page_number":358,"box":{"x":117,"y":472,"width":337,"height":12}},{"id":"fc9f3007-541e-4363-a887-cafc043ea58d","block_type":"box","text":"A Fund may engage in transactions in options on","page_number":358,"box":{"x":454,"y":472,"width":370,"height":12}},{"id":"545deb75-8abb-46e1-81ab-35d2ad813a27","block_type":"box","text":"individual securities, baskets of securities or securities indices, or particular measurements of value or","page_number":358,"box":{"x":117,"y":488,"width":761,"height":12}},{"id":"6517a507-0200-4f61-9410-99b2b69bd1da","block_type":"box","text":"rates, such as an index of the price of treasury securities or an index representative of short-term","page_number":358,"box":{"x":117,"y":503,"width":724,"height":12}},{"id":"aec09d96-fe10-481b-8ed1-17b1f7380d4b","block_type":"box","text":"interest rates. Such investments may be made on exchanges and in the OTC markets. In general,","page_number":358,"box":{"x":117,"y":519,"width":732,"height":12}},{"id":"0f93af6c-ac9c-47a1-acc7-3fb8510b5af5","block_type":"box","text":"exchange-traded options have standardized exercise prices and expiration dates and require the","page_number":358,"box":{"x":116,"y":534,"width":723,"height":12}},{"id":"9be415a0-51fb-4703-828d-3f84717970b5","block_type":"box","text":"parties to post margin against their obligations, and the performance of the parties’ obligations in","page_number":358,"box":{"x":117,"y":550,"width":720,"height":12}},{"id":"cb76452e-154e-41c5-b438-abc88f9a6210","block_type":"box","text":"connection with such options is guaranteed by the exchange or a related clearing corporation. OTC","page_number":358,"box":{"x":116,"y":565,"width":742,"height":12}},{"id":"d58b31d4-fc0b-4f41-91b2-2d82a37b53b7","block_type":"box","text":"options have more flexible terms negotiated between the buyer and the seller, but are subject to","page_number":358,"box":{"x":116,"y":581,"width":717,"height":12}},{"id":"f014cec6-f826-4131-88db-1d9612ebf3e4","block_type":"box","text":"greater credit risk. OTC options also involve greater illiquidity risk.","page_number":358,"box":{"x":116,"y":596,"width":493,"height":12}},{"id":"b7c423bf-958b-4cea-9d7d-0771fae1f5ac","block_type":"box","text":"A Fund may also engage in transactions in options which have additional features that result in","page_number":358,"box":{"x":116,"y":628,"width":709,"height":12}},{"id":"6fd7ff34-dc23-44e8-8bae-8fb74ec42041","block_type":"box","text":"different payment structures and/or expirations (commonly referred to as exotic options). For example,","page_number":358,"box":{"x":116,"y":644,"width":765,"height":12}},{"id":"14a231b1-e616-4043-96fb-c7b60a216f98","block_type":"box","text":"barrier options are exotic options that can only be exercised (or automatically expire) if the price of the","page_number":358,"box":{"x":117,"y":659,"width":761,"height":12}},{"id":"69396d57-a643-412e-98e8-17b446e80eb3","block_type":"box","text":"underlying asset reaches one or more predetermined levels on or before expiration. Binary options are","page_number":358,"box":{"x":117,"y":675,"width":760,"height":12}},{"id":"a492bcbf-d963-404a-8538-d5a6abce8c84","block_type":"box","text":"another example of exotic options which have a fixed all-or-nothing payout if one or more","page_number":358,"box":{"x":116,"y":690,"width":661,"height":12}},{"id":"50c019f8-e948-4c83-9102-4d6a3c3180b9","block_type":"box","text":"predetermined conditions are met. Exotic options are typically traded in OTC markets.","page_number":358,"box":{"x":117,"y":706,"width":635,"height":12}},{"id":"fba99ac1-26d5-4c37-ab58-c457ce7d41ee","block_type":"box","text":"There are several risks associated with transactions in options on securities and indexes. For example,","page_number":358,"box":{"x":116,"y":738,"width":763,"height":12}},{"id":"d25943a4-149d-43af-ae32-d4e65083159a","block_type":"box","text":"there are significant differences between the securities and options markets that could result in an","page_number":358,"box":{"x":116,"y":753,"width":726,"height":12}},{"id":"7ae4492f-b151-49d9-a994-9e3c4cc9a099","block_type":"box","text":"imperfect correlation between these markets, causing a given transaction not to achieve its objectives.","page_number":358,"box":{"x":117,"y":769,"width":757,"height":12}},{"id":"dfaabad8-0d9c-40b7-85c3-89d15a27e992","block_type":"box","text":"In addition, a liquid market for particular options, whether traded OTC or on a national securities","page_number":358,"box":{"x":117,"y":784,"width":710,"height":12}},{"id":"672e82b9-2fb5-4f60-b158-76eff5903fba","block_type":"box","text":"exchange (“Exchange”) may be absent for reasons which include the following: there may be","page_number":358,"box":{"x":116,"y":800,"width":690,"height":12}},{"id":"0c823545-3c29-4f7c-880b-b655672c6d3e","block_type":"box","text":"insufficient trading interest in certain options; restrictions may be imposed by an Exchange on opening","page_number":358,"box":{"x":117,"y":815,"width":757,"height":12}},{"id":"ed642335-a9c8-4ab5-8023-815759d19566","block_type":"box","text":"transactions or closing transactions or both; trading halts, suspensions or other restrictions may be","page_number":358,"box":{"x":116,"y":831,"width":737,"height":12}},{"id":"5ddc6372-8118-4856-a403-63b9f2071391","block_type":"box","text":"imposed with respect to particular classes or series of options or underlying securities; unusual or","page_number":358,"box":{"x":117,"y":846,"width":727,"height":12}},{"id":"b8d0286d-f701-4c3e-8861-6788fb6974fe","block_type":"box","text":"unforeseen circumstances may interrupt normal operations on an Exchange; the facilities of an","page_number":358,"box":{"x":117,"y":862,"width":708,"height":12}},{"id":"73c6d3ec-4e0c-4035-97a4-cf47d6c48a84","block_type":"box","text":"Exchange or the Options Clearing Corporation may not at all times be adequate to handle current","page_number":358,"box":{"x":117,"y":877,"width":728,"height":12}},{"id":"3c7c8d8b-6b97-4507-ae0f-b6efe6c3f3bc","block_type":"box","text":"II-26","page_number":358,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"10738878-81d5-4338-a359-b76b9eb6fd31","block_type":"box","text":"NM1026U-6004382-358/605","page_number":358,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3f7eacfd-f701-4ab8-a055-e06f0ce26785","block_type":"box","text":"trading volume; or one or more Exchanges could, for economic or other reasons, decide or be","page_number":359,"box":{"x":116,"y":87,"width":703,"height":12}},{"id":"3226ad95-d9a4-431e-94e2-a4f77026eb91","block_type":"box","text":"compelled at some future date to discontinue the trading of options (or a particular class or series of","page_number":359,"box":{"x":116,"y":102,"width":746,"height":13}},{"id":"57803620-6220-42cd-b219-5b79a7730003","block_type":"box","text":"options), in which event the market on that Exchange (or in that class or series of options) would cease","page_number":359,"box":{"x":116,"y":118,"width":770,"height":12}},{"id":"6c63fd29-63e1-480d-9c21-2356cc217fb7","block_type":"box","text":"to exist, although outstanding options that had been issued by the Options Clearing Corporation as a","page_number":359,"box":{"x":116,"y":134,"width":753,"height":12}},{"id":"7ee6adb0-4b97-4623-b9f5-281e90daab3a","block_type":"box","text":"result of trades on that Exchange would continue to be exercisable in accordance with their terms.","page_number":359,"box":{"x":117,"y":149,"width":732,"height":12}},{"id":"a4816ca0-cad9-40a8-aaa2-35249204c05d","block_type":"box","text":"Each of the options exchanges has established limitations governing the maximum number of call or","page_number":359,"box":{"x":117,"y":180,"width":749,"height":12}},{"id":"bcd7ed22-41e8-4366-a320-1ef86e361fa6","block_type":"box","text":"put options on the same asset that may be bought or written by a single investor, whether acting alone","page_number":359,"box":{"x":117,"y":196,"width":764,"height":12}},{"id":"57eb9f17-bfe7-49ed-84b0-a9220f7e891a","block_type":"box","text":"or in concert with others (regardless of whether such options are written on the same or different","page_number":359,"box":{"x":116,"y":211,"width":720,"height":12}},{"id":"564609ab-8d26-4012-bf36-0c302b358936","block_type":"box","text":"exchanges or are held or written on one or more accounts or through one or more brokers). Under","page_number":359,"box":{"x":116,"y":227,"width":735,"height":12}},{"id":"92e3f617-b6ff-4e73-8722-6e65fdc20b09","block_type":"box","text":"these limitations, option positions of all investment companies advised by the Manager are combined","page_number":359,"box":{"x":116,"y":242,"width":755,"height":12}},{"id":"d5c73536-b087-4d8b-a155-f331fdcb4dc0","block_type":"box","text":"for purposes of these limits. Pursuant to these limitations, an exchange may order the liquidation of","page_number":359,"box":{"x":116,"y":258,"width":740,"height":12}},{"id":"b907fd1c-4b81-4d2a-acb0-a8bee7633d95","block_type":"box","text":"positions and may impose other sanctions or restrictions. These position limits may restrict the number","page_number":359,"box":{"x":117,"y":273,"width":766,"height":12}},{"id":"7dea6b9b-42f4-4567-b4b8-961b5c06e209","block_type":"box","text":"of listed options that a Fund may buy or sell.","page_number":359,"box":{"x":116,"y":289,"width":334,"height":12}},{"id":"e4c3ec13-b4be-4fe2-a29c-46c2c58e605c","block_type":"box","text":"Call Options.","page_number":359,"box":{"x":117,"y":320,"width":100,"height":12}},{"id":"f9bb0f9f-d16c-4392-b02d-c1d0625a44ee","block_type":"box","text":"A Fund may purchase call options on any of the types of securities or instruments in","page_number":359,"box":{"x":217,"y":320,"width":629,"height":12}},{"id":"554b8646-448c-4598-9052-8422039eb09f","block_type":"box","text":"which it may invest. A purchased call option gives a Fund the right to buy, and obligates the seller to","page_number":359,"box":{"x":116,"y":335,"width":748,"height":12}},{"id":"f5e5208f-3712-4f99-bbfd-6bb8129ba82f","block_type":"box","text":"sell, the underlying security at the exercise price at any time during the option period. A Fund also may","page_number":359,"box":{"x":116,"y":351,"width":767,"height":12}},{"id":"c20b67f7-ad39-45e1-98ec-f34b35b08ba1","block_type":"box","text":"purchase and sell call options on indices. Index options are similar to options on securities except that,","page_number":359,"box":{"x":117,"y":366,"width":765,"height":12}},{"id":"a857c78b-a295-4775-9549-dc405a6873a6","block_type":"box","text":"rather than taking or making delivery of securities underlying the option at a specified price upon","page_number":359,"box":{"x":117,"y":382,"width":718,"height":12}},{"id":"1e35ddbd-7ad1-426c-9a76-d83afe9c5b45","block_type":"box","text":"exercise, an index option gives the holder the right to receive cash upon exercise of the option if the","page_number":359,"box":{"x":116,"y":397,"width":745,"height":12}},{"id":"005cf483-0b70-496c-9e1a-19a1c3217640","block_type":"box","text":"level of the index upon which the option is based is greater than the exercise price of the option.","page_number":359,"box":{"x":117,"y":413,"width":716,"height":12}},{"id":"ec0f6ea2-d2e7-4038-bb51-8d73e8f45d15","block_type":"box","text":"A written call option is covered if a Fund holds a call on the same security or index as the call written","page_number":359,"box":{"x":116,"y":444,"width":750,"height":12}},{"id":"e79d0005-1524-4b57-a4b6-143d39f36f23","block_type":"box","text":"where the exercise price of the call held is (i) equal to or less than the exercise price of the call written,","page_number":359,"box":{"x":116,"y":459,"width":765,"height":12}},{"id":"98032dfd-883b-46ba-9f9e-86e2cd86b04c","block_type":"box","text":"or (ii) greater than the exercise price of the call written provided the difference is maintained by the","page_number":359,"box":{"x":116,"y":475,"width":736,"height":12}},{"id":"6651f0ef-4fd7-42c3-9d4c-cb74b7ff5351","block_type":"box","text":"Fund in assets which are not considered illiquid investments under the Funds’ Liquidity Program (as","page_number":359,"box":{"x":117,"y":490,"width":745,"height":12}},{"id":"e1ff1715-351f-4cfa-afa3-5addaa89caef","block_type":"box","text":"defined below) (“liquid assets”) designated on the Manager’s or the sub-adviser’s books and records to","page_number":359,"box":{"x":116,"y":506,"width":769,"height":12}},{"id":"7c481d93-f6f7-4358-94e7-815ef60e9a96","block_type":"box","text":"the extent required by Commission guidelines.","page_number":359,"box":{"x":116,"y":521,"width":350,"height":12}},{"id":"e191bc98-f47d-4b86-b53e-3506754bea48","block_type":"box","text":"A Fund may write (","page_number":359,"box":{"x":116,"y":552,"width":140,"height":12}},{"id":"96910cf3-079c-495f-9dd8-9c8471267fd0","block_type":"box","text":"i.e.","page_number":359,"box":{"x":257,"y":552,"width":21,"height":10}},{"id":"3dbc1619-6a02-4ebe-876a-4e935029a4f6","block_type":"box","text":", sell) covered call options on the securities or instruments in which it may invest","page_number":359,"box":{"x":281,"y":552,"width":599,"height":12}},{"id":"f07dc615-ce82-4067-b3a1-fec0f624ca27","block_type":"box","text":"and to enter into closing purchase transactions with respect to certain of such options. A covered call","page_number":359,"box":{"x":116,"y":568,"width":754,"height":12}},{"id":"bda28425-9614-44ee-b5c3-9b431f287627","block_type":"box","text":"option is an option in which a Fund, in return for a premium, gives another party a right to buy specified","page_number":359,"box":{"x":116,"y":583,"width":769,"height":12}},{"id":"3c9af2ed-8714-489a-b855-6608d35d94bf","block_type":"box","text":"securities owned by the Fund at a specified future date and price set at the time of the contract. The","page_number":359,"box":{"x":116,"y":599,"width":747,"height":12}},{"id":"0bf8f28c-198a-4b76-a97c-796616456b08","block_type":"box","text":"principal reason for writing call options is the attempt to realize, through the receipt of premiums, a","page_number":359,"box":{"x":117,"y":614,"width":733,"height":12}},{"id":"a229b433-aebe-4b6c-82b8-f67be2919fc3","block_type":"box","text":"greater return than would be realized on the securities alone. By writing covered call options, a Fund","page_number":359,"box":{"x":116,"y":630,"width":750,"height":12}},{"id":"091a2549-0558-49a2-a6ac-464fd895f503","block_type":"box","text":"gives up the opportunity, while the option is in effect, to profit from any price increase in the underlying","page_number":359,"box":{"x":116,"y":645,"width":763,"height":12}},{"id":"e8ad9a26-5123-41bc-afa5-5303d4478ebc","block_type":"box","text":"security above the option exercise price. In addition, a Fund’s ability to sell the underlying security will","page_number":359,"box":{"x":116,"y":661,"width":753,"height":12}},{"id":"10a7f567-9cc1-4bfc-bdc6-31d278bf127f","block_type":"box","text":"be limited while the option is in effect unless the Fund enters into a closing purchase transaction. A","page_number":359,"box":{"x":117,"y":676,"width":733,"height":12}},{"id":"a29da2f3-1de1-41dc-8bd9-672a001e45c8","block_type":"box","text":"closing purchase transaction cancels out a Fund’s position as the writer of an option by means of an","page_number":359,"box":{"x":116,"y":692,"width":742,"height":12}},{"id":"77c589a2-8294-4354-b2e3-26f5743bb314","block_type":"box","text":"offsetting purchase of an identical option prior to the expiration of the option it has written. Covered call","page_number":359,"box":{"x":116,"y":707,"width":762,"height":12}},{"id":"b98389c4-92bf-438d-bff5-025bfcf3cb5c","block_type":"box","text":"options also serve as a partial hedge to the extent of the premium received against the price of the","page_number":359,"box":{"x":116,"y":723,"width":731,"height":12}},{"id":"f63e16d6-dfd5-423a-a5fe-353ff1214da9","block_type":"box","text":"underlying security declining.","page_number":359,"box":{"x":117,"y":738,"width":213,"height":12}},{"id":"c7c4e11e-39c1-4975-9ee7-0293bb3018ab","block_type":"box","text":"A Fund may write (","page_number":359,"box":{"x":116,"y":769,"width":140,"height":12}},{"id":"f5cb3ed4-932b-456e-b8bd-a9458cb9a0f2","block_type":"box","text":"i.e.","page_number":359,"box":{"x":257,"y":769,"width":21,"height":10}},{"id":"25f9bf91-cf4f-4e30-9964-a71559dd6982","block_type":"box","text":", sell) uncovered call options on securities or instruments in which it may invest","page_number":359,"box":{"x":281,"y":769,"width":585,"height":12}},{"id":"b082bade-8762-40af-81e8-cae36eb91587","block_type":"box","text":"but that are not currently held by the Fund. The principal reason for writing uncovered call options is to","page_number":359,"box":{"x":117,"y":785,"width":758,"height":12}},{"id":"ae10d3ad-f8b1-43a5-8353-b597f3b18bbb","block_type":"box","text":"realize income without committing capital to the ownership of the underlying securities or instruments.","page_number":359,"box":{"x":117,"y":800,"width":752,"height":12}},{"id":"4e7c6bc5-e634-4198-b7d3-407907883027","block_type":"box","text":"When writing uncovered call options, a Fund must deposit and maintain sufficient margin with the","page_number":359,"box":{"x":116,"y":816,"width":721,"height":12}},{"id":"23ded0fc-2b5e-4023-b2a7-edc7c54b2b2a","block_type":"box","text":"broker-dealer through which it made the uncovered call option as collateral to ensure that the securities","page_number":359,"box":{"x":117,"y":831,"width":771,"height":12}},{"id":"307d7885-83e6-4014-ac15-c6c15c06ab40","block_type":"box","text":"can be purchased for delivery if and when the option is exercised. During periods of declining","page_number":359,"box":{"x":116,"y":847,"width":697,"height":12}},{"id":"5c37a668-9608-44ac-a0e6-4162185a17ab","block_type":"box","text":"securities prices or when prices are stable, writing uncovered calls can be a profitable strategy to","page_number":359,"box":{"x":116,"y":862,"width":724,"height":12}},{"id":"cef06c40-ba12-4ceb-9642-d8c89b7ebea2","block_type":"box","text":"increase a Fund’s income with minimal capital risk. Uncovered calls are riskier than covered calls","page_number":359,"box":{"x":117,"y":878,"width":724,"height":12}},{"id":"e08417b1-56b4-477c-84a0-ec6015abd91a","block_type":"box","text":"II-27","page_number":359,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"2cdacfe1-44f6-4f15-a9ac-a7ecd5dc8f7c","block_type":"box","text":"NM1026U-6004382-359/605","page_number":359,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"fe32e7cd-df5f-467e-a708-71e796f49737","block_type":"box","text":"because there is no underlying security held by a Fund that can act as a partial hedge. Uncovered calls","page_number":360,"box":{"x":117,"y":87,"width":771,"height":12}},{"id":"f65049b2-3754-4994-83cb-559c7051049c","block_type":"box","text":"have speculative characteristics and the potential for loss is unlimited. When an uncovered call is","page_number":360,"box":{"x":117,"y":102,"width":725,"height":12}},{"id":"4ddb2d63-7b9e-4609-8958-80941cf80237","block_type":"box","text":"exercised, a Fund must purchase the underlying security to meet its call obligation. There is also a risk,","page_number":360,"box":{"x":116,"y":118,"width":771,"height":12}},{"id":"c2ca3b25-80a3-4674-afb9-a6149ce0873b","block_type":"box","text":"especially with preferred and debt securities that lack sufficient liquidity, that the securities may not be","page_number":360,"box":{"x":116,"y":134,"width":760,"height":12}},{"id":"9c955907-1ad0-4af4-b612-7e2739bcbc40","block_type":"box","text":"available for purchase. If the purchase price exceeds the exercise price, a Fund will lose the difference.","page_number":360,"box":{"x":116,"y":149,"width":772,"height":12}},{"id":"f2abc199-c391-43fe-ba12-eda98b0f8a70","block_type":"box","text":"Put Options.","page_number":360,"box":{"x":116,"y":180,"width":97,"height":12}},{"id":"23b362ec-f56a-4f01-a529-d40a9cd66570","block_type":"box","text":"A Fund may purchase put options to seek to hedge against a decline in the value of its","page_number":360,"box":{"x":213,"y":180,"width":648,"height":12}},{"id":"49864ade-2f37-447b-b226-2df33ee20e44","block_type":"box","text":"securities or to enhance its return. By buying a put option, a Fund acquires a right to sell the underlying","page_number":360,"box":{"x":116,"y":196,"width":770,"height":12}},{"id":"a4965f03-d762-4657-928b-784885932cff","block_type":"box","text":"securities or instruments at the exercise price, thus limiting the Fund’s risk of loss through a decline in","page_number":360,"box":{"x":116,"y":211,"width":760,"height":12}},{"id":"82a93113-17f1-4860-bf55-d1a6915ff09e","block_type":"box","text":"the market value of the securities or instruments until the put option expires. The amount of any","page_number":360,"box":{"x":116,"y":227,"width":714,"height":12}},{"id":"f596675b-c93b-4e76-a318-2397a09d246f","block_type":"box","text":"appreciation in the value of the underlying securities or instruments will be partially offset by the","page_number":360,"box":{"x":116,"y":242,"width":714,"height":12}},{"id":"3ae62daa-e18c-4178-a93d-1fd2f5365062","block_type":"box","text":"amount of the premium paid for the put option and any related transaction costs. Prior to its expiration,","page_number":360,"box":{"x":116,"y":258,"width":765,"height":12}},{"id":"b4363a2c-e19e-4112-ad94-72a2a9342280","block_type":"box","text":"a put option may be sold in a closing sale transaction and profit or loss from the sale will depend on","page_number":360,"box":{"x":116,"y":273,"width":743,"height":12}},{"id":"7c14ca6b-a378-4083-87ab-54eb102359fb","block_type":"box","text":"whether the amount received is more or less than the premium paid for the put option plus the related","page_number":360,"box":{"x":116,"y":289,"width":759,"height":12}},{"id":"7cf4a379-d442-457e-b889-7dd88d417365","block_type":"box","text":"transaction costs. A closing sale transaction cancels out a Fund’s position as the purchaser of an","page_number":360,"box":{"x":116,"y":304,"width":725,"height":12}},{"id":"f320bdca-fe4b-441c-aacd-8f91eacbbb49","block_type":"box","text":"option by means of an offsetting sale of an identical option prior to the expiration of the option it has","page_number":360,"box":{"x":116,"y":320,"width":743,"height":12}},{"id":"6bc2e24a-11e9-4cb6-8467-755df2c24ec7","block_type":"box","text":"purchased. A Fund also may purchase uncovered put options.","page_number":360,"box":{"x":117,"y":335,"width":467,"height":12}},{"id":"8fb7769f-3a2b-4cf7-b960-d437c77687fc","block_type":"box","text":"A Fund also may write (","page_number":360,"box":{"x":116,"y":366,"width":176,"height":12}},{"id":"08585297-20e9-49d3-a0b7-5540a50c109b","block_type":"box","text":"i.e.","page_number":360,"box":{"x":293,"y":366,"width":20,"height":10}},{"id":"4de657aa-5cd1-4676-ae32-8fb969da0e2a","block_type":"box","text":", sell) put options on the types of securities or instruments that may be held","page_number":360,"box":{"x":316,"y":366,"width":563,"height":12}},{"id":"3fd36928-653d-43bc-bda3-2f935b4a0ac1","block_type":"box","text":"by the Fund. A Fund will receive a premium for writing a put option, which increases the Fund’s return.","page_number":360,"box":{"x":117,"y":382,"width":763,"height":12}},{"id":"0aac1bcf-1952-43f3-9c53-fb5b58737df2","block_type":"box","text":"A Fund also may write (","page_number":360,"box":{"x":116,"y":413,"width":172,"height":12}},{"id":"4a515763-7d3b-4690-90b8-0c46c6ab7cbf","block_type":"box","text":"i.e.","page_number":360,"box":{"x":289,"y":413,"width":20,"height":9}},{"id":"60d88d4d-8132-4863-a0d7-127bb67c9358","block_type":"box","text":", sell) uncovered put options on securities or instruments in which it may invest","page_number":360,"box":{"x":312,"y":413,"width":575,"height":12}},{"id":"91ee3dd5-efc8-4ebc-b57f-86aecbe1dd06","block_type":"box","text":"but with respect to which the Fund does not current","page_number":360,"box":{"x":117,"y":428,"width":372,"height":12}},{"id":"2a65c3fb-84e9-45df-9fee-b527601599f5","block_type":"box","text":"ly have a corresponding short position or has not","page_number":360,"box":{"x":490,"y":428,"width":359,"height":12}},{"id":"95f554e7-f9fb-4fd6-a02a-4027e5f1f48f","block_type":"box","text":"deposited as collateral cash equal to the exercise va","page_number":360,"box":{"x":116,"y":444,"width":381,"height":12}},{"id":"f34b6f3a-0a66-409a-8f75-d7cb35e32aee","block_type":"box","text":"lue of the put option with","page_number":360,"box":{"x":498,"y":444,"width":182,"height":12}},{"id":"7b99438b-4edd-4ede-92ca-e3cf1d4f3fcd","block_type":"box","text":"the broker-dealer through","page_number":360,"box":{"x":680,"y":444,"width":190,"height":12}},{"id":"66774126-a082-4fae-816f-aeb2904197b5","block_type":"box","text":"which it made the uncovered put opt","page_number":360,"box":{"x":116,"y":459,"width":264,"height":12}},{"id":"1c6d5904-484c-4c58-a9ea-3675a101713b","block_type":"box","text":"ion. The principal reason for writing uncovered put options is to","page_number":360,"box":{"x":381,"y":459,"width":461,"height":12}},{"id":"c1411a92-5fb2-42e6-b271-ecd632430e80","block_type":"box","text":"receive premium income and to acquire such securities","page_number":360,"box":{"x":117,"y":475,"width":400,"height":12}},{"id":"96cfdad7-6443-48a9-8224-843b35e32cc1","block_type":"box","text":"or instruments at a net cost below the current","page_number":360,"box":{"x":517,"y":475,"width":339,"height":9}},{"id":"b2a2f6c9-be34-40fb-8813-e75575c59fec","block_type":"box","text":"market value. A Fund has the obligation to buy the","page_number":360,"box":{"x":117,"y":490,"width":370,"height":12}},{"id":"616de455-8221-4d1c-a097-8efc3f2305cf","block_type":"box","text":"securities or instruments at an agreed upon price if","page_number":360,"box":{"x":488,"y":490,"width":373,"height":12}},{"id":"7ad7682b-e420-4247-8a57-11dad7fd1c73","block_type":"box","text":"the price of the securities or instruments decreases bel","page_number":360,"box":{"x":116,"y":506,"width":397,"height":12}},{"id":"50f94c17-e1be-43c8-aad2-4bd49b6022a4","block_type":"box","text":"ow the exercise price. If the price of the securities","page_number":360,"box":{"x":515,"y":506,"width":364,"height":12}},{"id":"6d885051-d534-45ea-ad2d-0a19edf35098","block_type":"box","text":"or instruments increases during the option period,","page_number":360,"box":{"x":116,"y":521,"width":360,"height":12}},{"id":"bcf77d02-7722-4102-a718-151bfa14f956","block_type":"box","text":"the option will expire worthless and a Fund will retain","page_number":360,"box":{"x":477,"y":521,"width":393,"height":12}},{"id":"3468f2ae-5dbc-4a16-8ae0-5acffbbda7eb","block_type":"box","text":"the premium and will not have to purchase the securiti","page_number":360,"box":{"x":116,"y":537,"width":392,"height":12}},{"id":"1a20f686-90ea-4878-8b37-a20ad9fea4fa","block_type":"box","text":"es or instruments at the exercise price.","page_number":360,"box":{"x":510,"y":537,"width":286,"height":12}},{"id":"4f5f548e-eba4-4b6c-83e0-10dbb624350c","block_type":"box","text":"Options on Government National Mortgage Association (“GNMA”) Certificates.","page_number":360,"box":{"x":117,"y":568,"width":586,"height":12}},{"id":"7cd53244-0f86-4bc6-aa34-e4617924b9b9","block_type":"box","text":"The following","page_number":360,"box":{"x":704,"y":568,"width":103,"height":12}},{"id":"99224aff-5508-446f-880b-66bf661b0fb7","block_type":"box","text":"information relates to the unique characteristics of options on GNMA Certificates. Since the remaining","page_number":360,"box":{"x":117,"y":583,"width":759,"height":12}},{"id":"68e67310-754c-497d-96a3-f17e579d3042","block_type":"box","text":"principal balance of GNMA Certificates declines each month as a result of mortgage payments, a","page_number":360,"box":{"x":117,"y":599,"width":725,"height":12}},{"id":"c124f602-6c1f-4572-bfbd-34d3cd4f5bdd","block_type":"box","text":"Fund, as a writer of a GNMA call holding GNMA Certificates as “cover” to satisfy its delivery obligation","page_number":360,"box":{"x":117,"y":614,"width":761,"height":12}},{"id":"5c9ee9bd-e288-429f-ad49-1e94c5717b53","block_type":"box","text":"in the event of exercise, may find that the GNMA Certificates it holds no longer have a sufficient","page_number":360,"box":{"x":117,"y":630,"width":714,"height":12}},{"id":"50729b2b-5c1f-4c43-bfeb-85606bb4b78c","block_type":"box","text":"remaining principal balance for this purpose. Should this occur, a Fund will purchase additional GNMA","page_number":360,"box":{"x":117,"y":645,"width":763,"height":12}},{"id":"18dea096-60b0-45e2-9fb7-0601a56a580a","block_type":"box","text":"Certificates from the same pool (if obtainable) or other GNMA Certificates in the cash market in order","page_number":360,"box":{"x":117,"y":661,"width":750,"height":12}},{"id":"192d6b7e-b926-4548-940b-8c3b24b8c380","block_type":"box","text":"to maintain its “cover.”","page_number":360,"box":{"x":116,"y":676,"width":165,"height":10}},{"id":"4b627385-b5e6-401a-a298-a9044ca48eae","block_type":"box","text":"A GNMA Certificate held by a Fund to cover an option position in any but the nearest expiration month","page_number":360,"box":{"x":116,"y":707,"width":758,"height":12}},{"id":"4d964705-00d6-44b6-8290-bec84b90e837","block_type":"box","text":"may cease to represent cover for the option in the event of a decline in the GNMA coupon rate at","page_number":360,"box":{"x":117,"y":723,"width":719,"height":12}},{"id":"30f04386-03de-4d7e-b84f-db800aa8b39b","block_type":"box","text":"which new pools are originated under the FHA/VA loan ceiling in effect at any given time. If this should","page_number":360,"box":{"x":116,"y":738,"width":759,"height":12}},{"id":"f44fdaff-bd66-48fb-91c8-5873a9f24e42","block_type":"box","text":"occur, a Fund will no longer be covered, and the Fund will either enter into a closing purchase","page_number":360,"box":{"x":116,"y":754,"width":696,"height":12}},{"id":"c197be21-6e60-4096-a46f-326fc8df88b3","block_type":"box","text":"transaction or replace such Certificate with a certificate that represents cover. When a Fund closes its","page_number":360,"box":{"x":116,"y":769,"width":754,"height":12}},{"id":"905edffa-a91f-4396-87cc-181d375b6ee1","block_type":"box","text":"position or replaces such Certificate, it may realize an unanticipated loss and incur transaction costs.","page_number":360,"box":{"x":117,"y":785,"width":745,"height":12}},{"id":"a22bcb85-e2c9-4a48-8800-b7d5c1fccf6c","block_type":"box","text":"Options on Swaps (“Swaptions”).","page_number":360,"box":{"x":117,"y":816,"width":243,"height":12}},{"id":"473083a1-5cff-40b9-ae69-45cf9cd2d680","block_type":"box","text":"A swaption gives a counterparty the option (but not the obligation) to","page_number":360,"box":{"x":366,"y":816,"width":508,"height":12}},{"id":"5f95ef33-8173-4b48-81e4-f70d97b69239","block_type":"box","text":"enter into a new swap agreement or to shorten, extend, cancel or otherwise modify an existing swap","page_number":360,"box":{"x":116,"y":831,"width":750,"height":12}},{"id":"ee56ad13-691b-4e76-946a-908140c7ce8a","block_type":"box","text":"agreement, at a designated future time on specified terms. A Fund may write (","page_number":360,"box":{"x":116,"y":847,"width":580,"height":12}},{"id":"d24128d8-e31d-4040-b7c8-fb0f100db333","block_type":"box","text":"i.e.","page_number":360,"box":{"x":698,"y":847,"width":20,"height":9}},{"id":"fac46c7f-00f1-44f6-be81-b6366dfaa210","block_type":"box","text":", sell) and purchase","page_number":360,"box":{"x":721,"y":847,"width":150,"height":12}},{"id":"43271d13-acc0-4c6c-a531-efa765429279","block_type":"box","text":"put and call swaptions. Depending on the terms of the particular option agreement, a Fund will","page_number":360,"box":{"x":117,"y":862,"width":704,"height":12}},{"id":"794d1504-1a4e-46c8-8bde-1df66befd082","block_type":"box","text":"generally incur a greater degree of risk when it writes a swaption than it will incur when it purchases a","page_number":360,"box":{"x":116,"y":878,"width":758,"height":12}},{"id":"6d08b48d-fb00-46cb-994b-698c2905e9f0","block_type":"box","text":"II-28","page_number":360,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"ed2eb746-3592-4334-ba95-3ae2da8682aa","block_type":"box","text":"NM1026U-6004382-360/605","page_number":360,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ec99c2d3-7937-4f54-8627-88c1bfab7353","block_type":"box","text":"swaption. When a Fund purchases a swaption, it risks losing only the amount of the premium it has","page_number":361,"box":{"x":116,"y":87,"width":741,"height":12}},{"id":"d796d84c-e540-4e9c-bc1d-065623b5fef0","block_type":"box","text":"paid should it decide to let the option expire unexercised. However, when a Fund writes a swaption,","page_number":361,"box":{"x":117,"y":103,"width":743,"height":11}},{"id":"deba99fa-d99a-45a9-b80f-c576d99bca2e","block_type":"box","text":"upon exercise of the option the Fund will become obligated according to the terms of the underlying","page_number":361,"box":{"x":117,"y":118,"width":743,"height":12}},{"id":"75c5553c-f1a9-4439-bf8d-97083288b1e5","block_type":"box","text":"agreement and the potential for loss may be unlimited. Certain swaptions are permitted, although not","page_number":361,"box":{"x":116,"y":134,"width":754,"height":12}},{"id":"c778db87-0192-4c6d-acc1-08999e72fd6a","block_type":"box","text":"required, to be cleared.","page_number":361,"box":{"x":117,"y":149,"width":177,"height":12}},{"id":"b099f45c-8654-42f1-8538-582b707fe1cc","block_type":"box","text":"A Fund will likely enter into these transactions to preserve a return or spread on a particular investment","page_number":361,"box":{"x":116,"y":180,"width":770,"height":12}},{"id":"0115b81d-fa44-492c-b2c1-31bf52336eb3","block_type":"box","text":"or portion of its portfolio or to protect against any increase in the price of securities the Fund anticipates","page_number":361,"box":{"x":116,"y":196,"width":772,"height":12}},{"id":"18f15f44-0d33-46c3-8844-971990980ef5","block_type":"box","text":"purchasing at a later date. A Fund generally will use these transactions for hedging purposes, not for","page_number":361,"box":{"x":117,"y":211,"width":751,"height":12}},{"id":"e992f82a-5386-4966-ba6a-5186250b32c2","block_type":"box","text":"speculation.","page_number":361,"box":{"x":116,"y":227,"width":94,"height":11}},{"id":"70cd26dd-4985-48ab-acd7-61c357667ac6","block_type":"box","text":"Swaptions may be subject to correlation risk, leverage risk, illiquidity risk and market risk. See “— Risk","page_number":361,"box":{"x":116,"y":258,"width":765,"height":12}},{"id":"c075bdbd-df7b-4d98-8e85-f2b55ccc8640","block_type":"box","text":"Factors in Derivatives” above.","page_number":361,"box":{"x":117,"y":273,"width":226,"height":10}},{"id":"cc0feaba-b6fa-471b-8814-4283b37f2b1c","block_type":"box","text":"FLEX Options.","page_number":361,"box":{"x":116,"y":304,"width":114,"height":12}},{"id":"d73834c5-6570-42c8-a535-0fdb99404ff1","block_type":"box","text":"FLEX Options are customized option contracts available through national securities","page_number":361,"box":{"x":231,"y":304,"width":623,"height":12}},{"id":"0824b410-ad04-4ec7-bddf-906d9d345f47","block_type":"box","text":"exchanges that are guaranteed for settlement by the Options Clearing Corporation (“OCC”). FLEX","page_number":361,"box":{"x":116,"y":320,"width":733,"height":12}},{"id":"c7230f75-4323-4d7c-b489-14a8fc1a4760","block_type":"box","text":"Options are listed on a U.S. national securities exchange. FLEX Options provide investors with the","page_number":361,"box":{"x":116,"y":335,"width":736,"height":12}},{"id":"fe85b8e8-9441-432a-bb97-0c7ce8e4e1c6","block_type":"box","text":"ability to customize assets referenced by the options, exercise prices, exercise styles (i.e., American","page_number":361,"box":{"x":116,"y":351,"width":750,"height":12}},{"id":"5b0ef624-41d9-4996-897b-b6a0f0b2952d","block_type":"box","text":"style, exercisable any time prior to the expiration date, or European-style, exercisable only on the","page_number":361,"box":{"x":116,"y":366,"width":726,"height":12}},{"id":"58dd3297-a5cd-43b2-ace1-e7d432b8f170","block_type":"box","text":"option expiration date) and expiration dates, while achieving price discovery in competitive, transparent","page_number":361,"box":{"x":116,"y":382,"width":769,"height":12}},{"id":"3be37d6f-8818-4792-a3ec-01e108fa41c0","block_type":"box","text":"auctions markets and avoiding the counterparty exposure of OTC options positions. Each option","page_number":361,"box":{"x":116,"y":397,"width":719,"height":12}},{"id":"bbe18ee0-1798-4ead-8e7a-ae1c3d06f1d1","block_type":"box","text":"contract entitles the holder thereof to purchase (for the","page_number":361,"box":{"x":116,"y":413,"width":410,"height":12}},{"id":"b18a3899-c613-4d44-8ada-857c5724c158","block_type":"box","text":"call options) or sell (for the put options) shares","page_number":361,"box":{"x":527,"y":413,"width":349,"height":12}},{"id":"b915c281-ea20-4a36-84d5-819b694bd336","block_type":"box","text":"of the reference asset at the strike price. A Fund’s portfolio may include several types of FLEX Options,","page_number":361,"box":{"x":116,"y":428,"width":772,"height":12}},{"id":"6551a5e7-74ae-42bc-be19-6508993350bd","block_type":"box","text":"including both purchased and written put and call options (as further described below). The FLEX","page_number":361,"box":{"x":117,"y":444,"width":726,"height":12}},{"id":"a322d6a6-7378-46d6-9886-c9f17744db8f","block_type":"box","text":"Options are all European style options, which means that they are exercisable at a predetermined","page_number":361,"box":{"x":116,"y":459,"width":730,"height":12}},{"id":"d47a3275-decc-456b-b63c-db4e4e66e5e1","block_type":"box","text":"specified price (the “strike price”) only on the FLEX Option’s expiration date.","page_number":361,"box":{"x":116,"y":475,"width":569,"height":12}},{"id":"30327f7a-ee2f-4613-9b31-484be71eb0b2","block_type":"box","text":"The OCC guarantees performance by each of the counterparties to the FLEX Options, becoming the","page_number":361,"box":{"x":116,"y":506,"width":752,"height":12}},{"id":"bb419c13-3487-4865-a740-a8c99c5dd85d","block_type":"box","text":"“buyer for every seller and the seller for every buyer”, reducing counterparty risk for clearing members","page_number":361,"box":{"x":116,"y":521,"width":762,"height":12}},{"id":"bb54cca0-2049-40b1-885e-cfe255fe9663","block_type":"box","text":"and options traders. Although guaranteed for settlement by the OCC, FLEX Options are still subject to","page_number":361,"box":{"x":116,"y":537,"width":762,"height":12}},{"id":"8f766945-ff68-46ad-b763-ec642e48246a","block_type":"box","text":"counterparty risk with the OCC and subject to the risk that the OCC may fail to perform the settlement","page_number":361,"box":{"x":116,"y":552,"width":760,"height":12}},{"id":"441f24c8-2e43-4399-a1ec-8d301f94bf31","block_type":"box","text":"of the FLEX Options due to bankruptcy or other adverse reasons. A Fund bears the risk that the OCC","page_number":361,"box":{"x":116,"y":568,"width":759,"height":12}},{"id":"cb4e4040-27b5-4b4c-9717-bcfc753ef7b9","block_type":"box","text":"will be unable or unwilling to perform its obligations under the FLEX Options contracts.","page_number":361,"box":{"x":116,"y":583,"width":646,"height":12}},{"id":"72988d1c-4cbf-44b3-8250-e1d94cbe6f68","block_type":"box","text":"Subject to determination by the Securities Committee of the OCC, adjustments may be made to the","page_number":361,"box":{"x":116,"y":614,"width":744,"height":12}},{"id":"fccf614e-7807-4015-9032-b066ae475341","block_type":"box","text":"FLEX Options for certain events (collectively, “Corporate Actions”) specified in the OCC’s by-laws and","page_number":361,"box":{"x":117,"y":630,"width":760,"height":12}},{"id":"b9ac5f7f-caf7-4753-a3ec-0bee45c275c1","block_type":"box","text":"rules: certain stock dividends or distributions, stock splits, reverse stock splits, rights offerings,","page_number":361,"box":{"x":117,"y":645,"width":702,"height":12}},{"id":"87a60848-27f6-4a0b-a858-7d89db682f9f","block_type":"box","text":"distributions, reorganizations, recapitalizations, or reclassifications with respect to an underlying","page_number":361,"box":{"x":116,"y":661,"width":710,"height":12}},{"id":"e028c04a-173f-4d35-9aa5-32db7f9eeaf1","block_type":"box","text":"security, or a merger, consolidation, dissolution or liquidation of the issuer of the underlying security.","page_number":361,"box":{"x":116,"y":676,"width":742,"height":12}},{"id":"d2483a91-782c-4384-9317-f015188f62f0","block_type":"box","text":"According to the OCC’s by-laws, the nature and extent of any such adjustment is to be determined by","page_number":361,"box":{"x":116,"y":692,"width":754,"height":12}},{"id":"11f79d93-d88d-409f-92c2-24a23afd69b6","block_type":"box","text":"the OCC’s Securities Committee, in light of the circumstances known to it at the time such","page_number":361,"box":{"x":116,"y":707,"width":667,"height":12}},{"id":"a1b46d60-7302-403c-9a4c-6ffb9b68c8b9","block_type":"box","text":"determination is made, based on its judgment as to what is appropriate for the protection of investors","page_number":361,"box":{"x":116,"y":723,"width":749,"height":12}},{"id":"6fbc2458-8927-484c-ac9c-e6ffb3d81321","block_type":"box","text":"and the public interest, taking into account such factors as fairness to holders and writers (or","page_number":361,"box":{"x":116,"y":738,"width":687,"height":12}},{"id":"45a01a62-7609-4731-afd0-2fe187123aa1","block_type":"box","text":"purchasers and sellers) of the affected options, the maintenance of a fair and orderly market in the","page_number":361,"box":{"x":117,"y":754,"width":729,"height":12}},{"id":"e122d6a2-128c-4101-9468-fb4bcc47ff4a","block_type":"box","text":"affected options, consistency of interpretation and practice, efficiency of exercise settlement","page_number":361,"box":{"x":116,"y":769,"width":682,"height":12}},{"id":"de202724-edac-4707-938a-8eab8311518b","block_type":"box","text":"procedures, and the coordination with other clearing agencies of the clearance and settlement of","page_number":361,"box":{"x":117,"y":785,"width":717,"height":12}},{"id":"f1b8d230-cbc4-4e1e-8f6f-97cb5eeed99f","block_type":"box","text":"transactions in the underlying interest.","page_number":361,"box":{"x":116,"y":800,"width":282,"height":12}},{"id":"4ab3c9fc-e09f-444a-8d0d-02c9b606c5a9","block_type":"box","text":"Certain Considerations Regarding Options","page_number":361,"box":{"x":151,"y":831,"width":314,"height":12}},{"id":"dd63846c-a212-40c7-973e-ee9c10b0d7af","block_type":"box","text":". The FLEX Options in which each Fund may invest will","page_number":361,"box":{"x":467,"y":831,"width":414,"height":12}},{"id":"8d6a8d7e-b8a2-4fab-a9b3-f2d906f356e1","block_type":"box","text":"be options on an exchange-traded fund (“ETF”) or the S&P 500 Index (together with such ETF, a","page_number":361,"box":{"x":150,"y":847,"width":723,"height":12}},{"id":"9ca8c73d-2a57-4554-b01d-6ec7454e1de5","block_type":"box","text":"“Reference Asset”). As such, the value of a Fund’s FLEX Options will fluctuate with changes in the","page_number":361,"box":{"x":150,"y":862,"width":735,"height":12}},{"id":"7988a994-1c49-4b8a-b7c3-6dbefd3932e7","block_type":"box","text":"value of the securities held by the ETF, and thus the ETF’s share price. In addition to the value of","page_number":361,"box":{"x":150,"y":878,"width":726,"height":12}},{"id":"db936dae-28d3-42f5-b6a8-71310d43c7ce","block_type":"box","text":"II-29","page_number":361,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"3cd65121-d372-4749-a222-254a33a1da24","block_type":"box","text":"NM1026U-6004382-361/605","page_number":361,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3b324e7b-a174-49af-b9c9-40be91550972","block_type":"box","text":"the ETF, the value of an option, in general, will reflect, among other things, the time remaining until","page_number":362,"box":{"x":150,"y":87,"width":738,"height":12}},{"id":"b5799add-4b97-484f-9259-40e8991dab7a","block_type":"box","text":"expiration (the end of the Outcome Period), the relationship of the exercise price to the market","page_number":362,"box":{"x":150,"y":102,"width":704,"height":13}},{"id":"a5143d50-8131-4da2-8bac-c703e59f9201","block_type":"box","text":"price of the Reference Asset, and general market conditions. Options that expire unexercised","page_number":362,"box":{"x":150,"y":118,"width":698,"height":12}},{"id":"279ad123-329e-4c33-943d-5063d8e21dc6","block_type":"box","text":"have no value.","page_number":362,"box":{"x":150,"y":134,"width":113,"height":9}},{"id":"fef06f61-55ec-44fe-8914-021f86071c37","block_type":"box","text":"The puts and calls on the Reference Asset entitle the purchaser of the option the right to purchase","page_number":362,"box":{"x":150,"y":157,"width":734,"height":12}},{"id":"7560c108-73ca-4000-b1cf-f7614a54acf9","block_type":"box","text":"(for a call option) or sell (for a put option) the Reference Asset at a predetermined specified price","page_number":362,"box":{"x":150,"y":172,"width":723,"height":12}},{"id":"a52a9f4b-c4f0-41d0-b5ac-d388d1d189d4","block_type":"box","text":"(the “strike price”). When a Fund writes a call on the Reference Asset, it receives a premium and","page_number":362,"box":{"x":150,"y":188,"width":722,"height":12}},{"id":"3375f227-aca2-4d99-92bc-3b0855c939f7","block_type":"box","text":"agrees that the purchaser of the call, upon exercise of the call, will receive from the Fund the","page_number":362,"box":{"x":150,"y":203,"width":693,"height":12}},{"id":"9703a4bd-8e28-4bb0-9a0e-7e7d16bd67db","block_type":"box","text":"delivery of a specified number of shares of the ETF in exchange for the strike price. When a Fund","page_number":362,"box":{"x":150,"y":219,"width":729,"height":12}},{"id":"30cc9691-0526-42f0-b8d9-623a51fa1fad","block_type":"box","text":"buys a call on the Reference Asset, it pays a premium and has the same rights to such call as","page_number":362,"box":{"x":150,"y":234,"width":702,"height":12}},{"id":"feda0b9a-b2cd-4ccb-b9c2-ff2be0547f74","block_type":"box","text":"indicated above. When a Fund buys a put on the Reference Asset, it pays a premium and has the","page_number":362,"box":{"x":150,"y":250,"width":730,"height":12}},{"id":"415b7d9d-395a-43f5-b297-35f769dc9b0f","block_type":"box","text":"right to require the seller of the put, upon the Fund’s exercise of the put, to deliver the specified","page_number":362,"box":{"x":150,"y":265,"width":710,"height":12}},{"id":"ffab3e90-3534-4f5a-8182-b583604d5a18","block_type":"box","text":"number of shares of the ETF in exchange for the strike price. When a Fund writes a put on the","page_number":362,"box":{"x":150,"y":281,"width":705,"height":12}},{"id":"82fed68d-c54b-453c-bb12-ad2e7ec2672c","block_type":"box","text":"Reference Asset, it receives a premium and the purchaser of the put has the right to require the","page_number":362,"box":{"x":151,"y":296,"width":714,"height":12}},{"id":"a7bb6704-dfed-4a66-91fc-213bb36a9aef","block_type":"box","text":"Fund to deliver the specified number of shares of the ETF in exchange for the strike price.","page_number":362,"box":{"x":151,"y":312,"width":671,"height":12}},{"id":"a52b2f6b-03bd-44c9-aa25-cb723963bce2","block_type":"box","text":"Although each Fund will generally utilize FLEX Options that are physically settled, a Fund may","page_number":362,"box":{"x":149,"y":335,"width":705,"height":12}},{"id":"95b94e06-ecca-43ef-8805-b7a1af44ebec","block_type":"box","text":"also utilize FLEX Options that are cash-settled. Cash-settled options give the holder the right to","page_number":362,"box":{"x":150,"y":351,"width":711,"height":12}},{"id":"ec7e652a-d234-4e62-8a9e-76a4b2d20956","block_type":"box","text":"receive an amount (or owe an amount) of cash upon the exercise of the option. Gain or loss","page_number":362,"box":{"x":150,"y":366,"width":686,"height":12}},{"id":"f7eafcba-e635-4ace-b7c6-6bee34bfe6c7","block_type":"box","text":"depends on changes in the value of the ETF’s share price relative to the strike price for a given","page_number":362,"box":{"x":150,"y":382,"width":710,"height":12}},{"id":"2a01f87f-fe8d-4872-9d18-fd939002d469","block_type":"box","text":"option contract. The amount of cash is equal to the difference between the closing price of the","page_number":362,"box":{"x":150,"y":397,"width":702,"height":12}},{"id":"3ecb9447-d827-4b98-9b3d-fea609029a96","block_type":"box","text":"ETF’s share price and the exercise price of the option contract times a specified multiple","page_number":362,"box":{"x":151,"y":413,"width":659,"height":12}},{"id":"1146a46f-c872-434b-820e-633bd292a622","block_type":"box","text":"(“multiplier”), which determines the total value for each point of such difference.","page_number":362,"box":{"x":150,"y":428,"width":593,"height":12}},{"id":"a95b7a7a-da10-4363-9874-ba44407ca647","block_type":"box","text":"Risks of Options on the Reference Assets","page_number":362,"box":{"x":150,"y":451,"width":311,"height":12}},{"id":"5a0e5b7a-f029-4a68-80fd-ff970071516d","block_type":"box","text":". If a Fund has purchased an option and exercises it","page_number":362,"box":{"x":462,"y":451,"width":390,"height":12}},{"id":"7a8cf141-e294-45a1-a8a1-b57592dd4f09","block_type":"box","text":"before the closing value for that day is available, it runs the risk that the level of the Reference","page_number":362,"box":{"x":150,"y":467,"width":702,"height":12}},{"id":"325c5f95-c5aa-4c83-80fb-3d53ee478152","block_type":"box","text":"Asset may subsequently change. If such a change causes the exercised option to fall out of the","page_number":362,"box":{"x":149,"y":482,"width":714,"height":12}},{"id":"0e90834d-98b0-44d3-9dae-6ff4f0450180","block_type":"box","text":"money, the applicable Fund will be required to pay the difference between the closing Reference","page_number":362,"box":{"x":150,"y":498,"width":721,"height":12}},{"id":"f6ee9da0-a6f6-4f88-ade6-97a825597d9c","block_type":"box","text":"Asset value and the exercise price of the option (times the applicable multiplier) to the assigned","page_number":362,"box":{"x":149,"y":513,"width":714,"height":12}},{"id":"58d47d2f-56b2-4bde-8589-cbaf93d48874","block_type":"box","text":"writer.","page_number":362,"box":{"x":149,"y":529,"width":51,"height":9}},{"id":"b00053c3-c149-4d18-a246-19597172e4d4","block_type":"box","text":"Foreign Exchange Transactions.","page_number":362,"box":{"x":116,"y":560,"width":247,"height":12}},{"id":"81353af4-bed8-47e5-b67a-6bc35e1c91c8","block_type":"box","text":"A Fund may enter into spot foreign exchange transactions, forward foreign exchange transactions (“FX","page_number":362,"box":{"x":116,"y":583,"width":768,"height":12}},{"id":"043c2b0d-3813-4610-aaad-8bbd2bd9ea39","block_type":"box","text":"forwards”) and currency swaps, purchase and sell currency options, currency futures and related","page_number":362,"box":{"x":116,"y":599,"width":723,"height":12}},{"id":"9ec3e8b6-d9fb-44bc-a4b0-aaece5f584a2","block_type":"box","text":"options thereon (collectively, “Currency Instruments”) for purposes of hedging against the decline in the","page_number":362,"box":{"x":116,"y":614,"width":772,"height":12}},{"id":"ad571259-1e35-4d61-91ae-f715f860e1e8","block_type":"box","text":"value of currencies in which its portfolio holdings are denominated against the U.S. dollar or, with","page_number":362,"box":{"x":116,"y":630,"width":725,"height":12}},{"id":"ce7f528f-8c4d-49bb-ace3-9b5461026623","block_type":"box","text":"respect to certain Funds, to seek to enhance returns.","page_number":362,"box":{"x":117,"y":645,"width":397,"height":12}},{"id":"380e05e6-8381-4b7f-977e-5dd803a922b4","block_type":"box","text":"Such transactions could be effected to hedge with respect to foreign dollar denominated securities","page_number":362,"box":{"x":116,"y":676,"width":729,"height":12}},{"id":"d34934bb-1681-4912-9485-1c72bf8756b1","block_type":"box","text":"owned by a Fund, sold by a Fund but not","page_number":362,"box":{"x":116,"y":692,"width":305,"height":12}},{"id":"a00107d6-ccb6-4e79-a0f7-cb0ce2d7850e","block_type":"box","text":"yet delivered, or committed or anticipated to be purchased by","page_number":362,"box":{"x":426,"y":692,"width":455,"height":12}},{"id":"55fef0a9-6045-4851-948b-83081247611f","block_type":"box","text":"a Fund. As an illustration, a Fund may use such techniques to hedge the stated value in U.S. dollars of","page_number":362,"box":{"x":116,"y":707,"width":764,"height":12}},{"id":"7434a3eb-cac2-4e7e-b8d7-251167f9b4da","block_type":"box","text":"an investment in a yen-denominated security. For example, the Fund may purchase a foreign currency","page_number":362,"box":{"x":116,"y":723,"width":762,"height":12}},{"id":"0eea68f6-c9c3-48ba-86ec-4fe800fa56c0","block_type":"box","text":"put option enabling it to sell a specified amount of yen","page_number":362,"box":{"x":117,"y":738,"width":398,"height":12}},{"id":"e1228c5a-d850-4765-850a-cc4c29412e35","block_type":"box","text":"for dollars at a specified price by a future date.","page_number":362,"box":{"x":521,"y":738,"width":344,"height":12}},{"id":"2c4e44dc-d2d6-4731-93c1-0c511501070c","block_type":"box","text":"To the extent the hedge is successful, a loss in the value of the yen relative to the dollar will tend to be","page_number":362,"box":{"x":116,"y":754,"width":759,"height":12}},{"id":"77acdf4d-af4a-4b57-afe4-fb0b4456c417","block_type":"box","text":"offset by an increase in the value of the put option. To offset, in whole or in part, the cost of acquiring","page_number":362,"box":{"x":116,"y":769,"width":748,"height":12}},{"id":"733286f3-2587-4d9a-a8aa-847e67cb05ab","block_type":"box","text":"such a put option, the Fund may also sell a call option which, if exercised, requires it to sell a specified","page_number":362,"box":{"x":116,"y":785,"width":758,"height":12}},{"id":"55242b73-652e-4c85-888d-f3c062246480","block_type":"box","text":"amount of yen for dollars at a specified price by a future date (a technique called a “straddle”). By","page_number":362,"box":{"x":116,"y":800,"width":722,"height":12}},{"id":"f2b5730d-c320-4059-9b02-53013c259dd6","block_type":"box","text":"selling such a call option in this illustration, the Fund gives up the opportunity to profit without limit from","page_number":362,"box":{"x":116,"y":816,"width":761,"height":12}},{"id":"c4e36d9d-acc5-42ea-84e5-1e40a68c2a1b","block_type":"box","text":"increases in the relative value of the yen to the dollar. “Straddles” of the type that may be used by a","page_number":362,"box":{"x":117,"y":831,"width":742,"height":12}},{"id":"2e8c7398-7323-4a66-b803-084a65316b34","block_type":"box","text":"Fund are considered hedging transactions. Certain Funds have a fundamental investment restriction","page_number":362,"box":{"x":117,"y":847,"width":749,"height":12}},{"id":"892b8b38-3984-4608-b164-30fc9ff97f46","block_type":"box","text":"that restricts currency option strategies.","page_number":362,"box":{"x":116,"y":862,"width":298,"height":12}},{"id":"ba01a88e-4880-49d1-a299-554ac366262f","block_type":"box","text":"II-30","page_number":362,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"b008369e-822b-489a-9ed4-b5a4c3acb5e7","block_type":"box","text":"NM1026U-6004382-362/605","page_number":362,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3b0a1bd4-a6d9-4e45-95ed-e5ff19805ad5","block_type":"box","text":"Hedging transactions involving Currency Instruments involve substantial risks, including correlation","page_number":363,"box":{"x":117,"y":87,"width":737,"height":12}},{"id":"1bd5eba0-b0a6-4ff9-a8b7-a0995535d479","block_type":"box","text":"risk. A Fund’s use of Currency Instruments to effect hedging strategies is intended to reduce the","page_number":363,"box":{"x":117,"y":102,"width":718,"height":13}},{"id":"75435ecc-58c7-44ee-8e62-3002b3ea4e34","block_type":"box","text":"volatility of the NAV of the Fund’s shares; however, the use of such hedging strategies will not prevent","page_number":363,"box":{"x":116,"y":118,"width":763,"height":12}},{"id":"4a4824e4-83fa-4c09-8582-7d10ba20753c","block_type":"box","text":"the NAV of the Fund’s shares from fluctuating. Moreover, although Currency Instruments will be used","page_number":363,"box":{"x":116,"y":134,"width":757,"height":12}},{"id":"5521ea6e-9ba7-4e84-9d5e-5dc877c5a169","block_type":"box","text":"with the intention of hedging against adverse currency movements, transactions in Currency","page_number":363,"box":{"x":116,"y":149,"width":689,"height":12}},{"id":"40f2c5b2-3e9f-47cd-9313-5a19399774a3","block_type":"box","text":"Instruments involve the risk that anticipated currency movements will not be accurately predicted and","page_number":363,"box":{"x":117,"y":165,"width":755,"height":12}},{"id":"fb35c612-8b6d-4329-a685-56fa0d90ef57","block_type":"box","text":"that the Fund’s hedging strategies will be ineffective. To the extent that a Fund hedges against","page_number":363,"box":{"x":116,"y":180,"width":706,"height":12}},{"id":"7dd0fb2e-1b75-4a48-9ef3-b71e9e58841f","block_type":"box","text":"anticipated currency movements that do not occur, the Fund may realize losses and decrease its total","page_number":363,"box":{"x":116,"y":196,"width":761,"height":12}},{"id":"73111dae-aef2-4bec-8581-d54f1fffe01b","block_type":"box","text":"return. Furthermore, a Fund will only engage in hedging activities from time to time and may not be","page_number":363,"box":{"x":117,"y":211,"width":738,"height":12}},{"id":"d34cbf5d-1e1f-449d-b1ff-0290b0ca4f76","block_type":"box","text":"engaging in hedging activities when movements in currency exchange rates actually occur.","page_number":363,"box":{"x":116,"y":227,"width":681,"height":12}},{"id":"e1ac9d91-3d67-4205-b37f-25c5cddfa9b0","block_type":"box","text":"In connection with its trading in forward foreign currency contracts, a Fund will contract with a foreign","page_number":363,"box":{"x":117,"y":258,"width":752,"height":12}},{"id":"322537d1-c9e5-493e-b061-a5b8c9b2a901","block_type":"box","text":"or domestic bank, or foreign or domestic securities dealer, to make or take future delivery of a specified","page_number":363,"box":{"x":116,"y":273,"width":772,"height":12}},{"id":"01603bdd-92ae-47f1-86e6-9acbc171ed4a","block_type":"box","text":"amount of a particular currency. There are no limitations on daily price moves in such forward","page_number":363,"box":{"x":116,"y":289,"width":699,"height":12}},{"id":"7fda5758-136a-48b7-9d45-833c8f9d6b5c","block_type":"box","text":"contracts, and banks and dealers are not required to continue to make markets in such contracts.","page_number":363,"box":{"x":116,"y":304,"width":728,"height":12}},{"id":"e25d295f-ef4c-46ea-b885-3dd5d6097ca6","block_type":"box","text":"There have been periods during which certain banks or dealers have refused to quote prices for such","page_number":363,"box":{"x":116,"y":320,"width":757,"height":12}},{"id":"0a0d722e-40a4-4051-9adc-e6de19627fcd","block_type":"box","text":"forward contracts or have quoted prices with an unusually wide spread between the price at which the","page_number":363,"box":{"x":116,"y":335,"width":761,"height":12}},{"id":"51888114-883f-4278-93d9-745f362a4ac0","block_type":"box","text":"bank or dealer is prepared to buy and that at which it is prepared to sell. Governmental imposition of","page_number":363,"box":{"x":117,"y":351,"width":747,"height":12}},{"id":"c97d41b0-7a2a-4704-ba0f-e3e81e04d51f","block_type":"box","text":"currency controls might limit any such forward contract trading. With respect to its trading of forward","page_number":363,"box":{"x":116,"y":366,"width":746,"height":12}},{"id":"5efdd4cf-b5fb-48df-b728-42fbe4d2b547","block_type":"box","text":"contracts, if any, a Fund will be subject to counterparty risk. Any such failure to perform by a","page_number":363,"box":{"x":116,"y":382,"width":689,"height":12}},{"id":"fd83d418-9e32-4cc4-8e27-cb518774d515","block_type":"box","text":"counterparty would deprive the Fund of any profit potential or force the Fund to cover its commitments","page_number":363,"box":{"x":116,"y":397,"width":762,"height":12}},{"id":"bb5e87a9-2a24-464e-856a-7f52e6b5dc14","block_type":"box","text":"for resale, if any, at the then market price and could result in a loss to the Fund.","page_number":363,"box":{"x":116,"y":413,"width":595,"height":12}},{"id":"b451cb84-e13f-47a4-94eb-1356ffeecfc2","block_type":"box","text":"It may not be possible for a Fund to hedge against currency exchange rate movements, even if","page_number":363,"box":{"x":117,"y":444,"width":709,"height":12}},{"id":"a38d15fd-7742-4069-ac35-4522d090a329","block_type":"box","text":"correctly anticipated, in the event that (i) the currency exchange rate movement is so generally","page_number":363,"box":{"x":116,"y":459,"width":707,"height":12}},{"id":"72c24002-5b68-4e09-bea5-8ab8bef9cbba","block_type":"box","text":"anticipated that the Fund is not able to enter into a hedging transaction at an effective price, or (ii) the","page_number":363,"box":{"x":116,"y":475,"width":757,"height":12}},{"id":"ebdb714f-5067-48a4-8e84-ddea95aa080f","block_type":"box","text":"currency exchange rate movement relates to a market with respect to which Currency Instruments are","page_number":363,"box":{"x":116,"y":490,"width":764,"height":12}},{"id":"d2df41e8-bf8d-49bf-846e-7915a74b0a18","block_type":"box","text":"not available and it is not possible to engage in effective foreign currency hedging. The cost to a Fund","page_number":363,"box":{"x":117,"y":506,"width":759,"height":12}},{"id":"caba8171-6756-46c8-9c92-c24a82b7d152","block_type":"box","text":"of engaging in foreign currency transactions varies with such factors as the currencies involved, the","page_number":363,"box":{"x":116,"y":521,"width":743,"height":12}},{"id":"57b4b87e-d520-468d-b24f-92aae877cd32","block_type":"box","text":"length of the contract period and the market conditions then prevailing. Since transactions in foreign","page_number":363,"box":{"x":117,"y":537,"width":744,"height":12}},{"id":"b01697ee-e20e-446d-a38c-d31cbb1a9827","block_type":"box","text":"currency exchange usually are conducted on a principal basis, no fees or commissions are involved.","page_number":363,"box":{"x":116,"y":552,"width":750,"height":12}},{"id":"c4eaa22c-de91-45e5-9e84-2b54ca1c207b","block_type":"box","text":"A Fund will not hedge a currency in excess of the aggregate market value of the securities that it owns","page_number":363,"box":{"x":116,"y":583,"width":765,"height":12}},{"id":"3aa9b357-c0dc-4995-b76b-f21359b87d69","block_type":"box","text":"(including receivables for unsettled securities sales), or has committed to purchase or anticipates","page_number":363,"box":{"x":117,"y":599,"width":724,"height":12}},{"id":"48245d39-ed31-4f0f-be19-6cc9b64d7980","block_type":"box","text":"purchasing, which are denominated in such currency.","page_number":363,"box":{"x":117,"y":614,"width":401,"height":12}},{"id":"a130ceb1-447c-44d6-b1e2-1fad5828bf4b","block_type":"box","text":"Spot Transactions and FX Forwards.","page_number":363,"box":{"x":117,"y":645,"width":266,"height":12}},{"id":"647780a3-37fd-4579-9156-34841a08fdb2","block_type":"box","text":"FX forwards are OTC contracts to purchase or sell a specified","page_number":363,"box":{"x":384,"y":645,"width":459,"height":12}},{"id":"77288517-70c9-433e-a03a-413213098046","block_type":"box","text":"amount of a specified currency or multinational curr","page_number":363,"box":{"x":116,"y":661,"width":373,"height":12}},{"id":"d460b02c-1f04-49ea-af7f-a2c8adaf94bd","block_type":"box","text":"ency unit at a specified price and specified future","page_number":363,"box":{"x":489,"y":661,"width":355,"height":12}},{"id":"2180d52a-a7d9-4776-9751-6d7f8c19f8f1","block_type":"box","text":"date. Spot foreign exchange transactions are similar","page_number":363,"box":{"x":116,"y":676,"width":380,"height":12}},{"id":"b6b73c52-f46b-4e73-8954-b7fec4bdb783","block_type":"box","text":"but are settled in the current, or “spot”, market. A","page_number":363,"box":{"x":501,"y":676,"width":354,"height":12}},{"id":"3081884d-f716-4926-9316-675b4c56e8ff","block_type":"box","text":"Fund will enter into foreign exchange transactions for pur","page_number":363,"box":{"x":117,"y":692,"width":413,"height":12}},{"id":"725eedd6-84d2-44e3-947b-ea429887e2a0","block_type":"box","text":"poses of hedging either a specific transaction or","page_number":363,"box":{"x":531,"y":692,"width":347,"height":12}},{"id":"efe52202-b205-420f-a041-e3c77e61b217","block_type":"box","text":"a portfolio position, or, with respect to certain Funds,","page_number":363,"box":{"x":116,"y":707,"width":379,"height":12}},{"id":"a92dd473-30f9-42ac-aa01-d169f981ecd0","block_type":"box","text":"to seek to enhance returns. FX forwards involve","page_number":363,"box":{"x":501,"y":707,"width":349,"height":10}},{"id":"57649d94-a2e9-4845-a863-405a8752e01a","block_type":"box","text":"substantial currency risk, credit risk and liquidity","page_number":363,"box":{"x":116,"y":723,"width":346,"height":12}},{"id":"c8b25501-c862-472e-a6df-1317e8491d80","block_type":"box","text":"risk. A Fund may enter into a foreign exchange","page_number":363,"box":{"x":468,"y":723,"width":340,"height":12}},{"id":"96fb2a3e-18ab-489c-82f8-fd92c7700152","block_type":"box","text":"transaction for purposes of hedging a specific trans","page_number":363,"box":{"x":116,"y":738,"width":371,"height":12}},{"id":"df9b0b03-b1f3-4bf9-b234-7b4e6cece57f","block_type":"box","text":"action by, for example, purchasing a currency needed","page_number":363,"box":{"x":488,"y":738,"width":391,"height":12}},{"id":"310df908-55c8-45c1-b10b-da52bcd2f507","block_type":"box","text":"to settle a security transaction or selling a currency in which the Fund has received or anticipates","page_number":363,"box":{"x":116,"y":754,"width":702,"height":12}},{"id":"5d1fcfb1-d382-4d28-b6a5-4ecc3577cd5e","block_type":"box","text":"receiving a dividend or distribution. A Fund may enter","page_number":363,"box":{"x":117,"y":769,"width":388,"height":12}},{"id":"3bd73905-1b8b-4135-b99b-ae59485da243","block_type":"box","text":"into a foreign exchange transaction for purposes of","page_number":363,"box":{"x":510,"y":769,"width":370,"height":12}},{"id":"23ee621c-48d6-4355-af12-81f948772f60","block_type":"box","text":"hedging a portfolio position by selling forward a currency in which a portfolio position of the Fund is","page_number":363,"box":{"x":117,"y":785,"width":714,"height":12}},{"id":"df194051-6f1f-4be0-af43-67b13c475859","block_type":"box","text":"denominated or by purchasing a currency in which t","page_number":363,"box":{"x":116,"y":800,"width":376,"height":12}},{"id":"abf972ed-dcad-480f-8bfb-1dcea74359ef","block_type":"box","text":"he Fund anticipates acquiring a portfolio position in","page_number":363,"box":{"x":493,"y":800,"width":368,"height":12}},{"id":"a2648e1b-ad64-40e9-8dd8-8917a19fbcd3","block_type":"box","text":"the near future. A Fund may also hedge a currency by entering into a transaction in a Currency","page_number":363,"box":{"x":116,"y":816,"width":690,"height":12}},{"id":"631a3787-8768-479f-92dc-8adaf8490f9a","block_type":"box","text":"Instrument denominated in a currency other","page_number":363,"box":{"x":117,"y":831,"width":322,"height":12}},{"id":"89443f88-7f29-475e-b8b3-9a720c3bd42d","block_type":"box","text":"than the currency being hedged (a “cross-hedge”). A Fund","page_number":363,"box":{"x":439,"y":831,"width":429,"height":12}},{"id":"6c4f9e9a-be8e-413d-9c00-feef96f7ad95","block_type":"box","text":"will only enter into a cross-hedge if the Manager believe","page_number":363,"box":{"x":116,"y":847,"width":405,"height":12}},{"id":"c91aca1b-dc06-409f-8747-c81210d8106b","block_type":"box","text":"s that (i) there is a demonstrably high correlation","page_number":363,"box":{"x":522,"y":847,"width":356,"height":12}},{"id":"9fe9886e-f8e5-4601-896f-6bd308aaccf7","block_type":"box","text":"between the currency in which the cross-","page_number":363,"box":{"x":117,"y":862,"width":297,"height":12}},{"id":"eb632571-cd37-4e00-9684-84fcc23d9ff8","block_type":"box","text":"hedge is denominated and the currency being hedged, and","page_number":363,"box":{"x":415,"y":862,"width":434,"height":12}},{"id":"5c9a9896-1683-4740-ad48-905c50015832","block_type":"box","text":"(ii) executing a cross-hedge through the curren","page_number":363,"box":{"x":117,"y":878,"width":339,"height":12}},{"id":"b48bee70-9949-403a-89ae-056c64844979","block_type":"box","text":"cy in which the cross-hedge is denominated will be","page_number":363,"box":{"x":457,"y":878,"width":374,"height":12}},{"id":"2964510d-a805-46ab-99a9-14da8114c40f","block_type":"box","text":"II-31","page_number":363,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"49c4ab05-4b54-40b7-87aa-993c80e0d4a9","block_type":"box","text":"NM1026U-6004382-363/605","page_number":363,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"fac435ab-5b34-42bd-97bc-54c37a448a3d","block_type":"box","text":"significantly more cost-effective or provide substant","page_number":364,"box":{"x":116,"y":87,"width":373,"height":12}},{"id":"3ee5424d-000f-47da-ba36-ccc390861c60","block_type":"box","text":"ially greater liquidity than executing a similar hedging","page_number":364,"box":{"x":490,"y":87,"width":388,"height":12}},{"id":"c9f6dac7-f41f-4cb1-baa9-ee494a41276f","block_type":"box","text":"transaction by means of the currency being hedged.","page_number":364,"box":{"x":116,"y":102,"width":383,"height":13}},{"id":"9f2ec9bb-d826-455d-b8ec-ae682218e137","block_type":"box","text":"A Fund may also engage in proxy hedging transactions to reduce the effect of currency fluctuations on","page_number":364,"box":{"x":116,"y":134,"width":765,"height":12}},{"id":"bf0cd736-5e66-4375-8571-37edba20b654","block_type":"box","text":"the value of existing or anticipated holdings of portfolio securities. Proxy hedging is often used when","page_number":364,"box":{"x":116,"y":149,"width":747,"height":12}},{"id":"a010b8d8-96be-4e52-ac21-f1f9662837a8","block_type":"box","text":"the currency to which the Fund is exposed is difficult to hedge, or to hedge against the U.S. dollar.","page_number":364,"box":{"x":116,"y":165,"width":733,"height":12}},{"id":"a63c6e7a-d0bb-4dfd-8fab-90aaa267d78e","block_type":"box","text":"Proxy hedging entails entering into a forward contract to sell a currency whose changes in value are","page_number":364,"box":{"x":117,"y":180,"width":746,"height":12}},{"id":"be866224-bc42-40cb-958b-27c73e14de6d","block_type":"box","text":"generally considered to be linked to a currency or currencies in which some or all of the Fund’s","page_number":364,"box":{"x":116,"y":196,"width":709,"height":12}},{"id":"b9d495cf-5e46-4304-a19c-8f14f682ed86","block_type":"box","text":"securities are, or are expected to be, denominated, and to buy U.S. dollars. Proxy hedging involves","page_number":364,"box":{"x":116,"y":211,"width":742,"height":12}},{"id":"22c43c87-6b9f-4939-a68b-1a2d441fe6c8","block_type":"box","text":"some of the same risks and considerations as other transactions with similar instruments. Currency","page_number":364,"box":{"x":116,"y":227,"width":742,"height":12}},{"id":"5db6c17e-831c-4532-86e0-ed49637f72bc","block_type":"box","text":"transactions can result in losses to the Fund if the currency being hedged fluctuates in value to a","page_number":364,"box":{"x":116,"y":242,"width":722,"height":12}},{"id":"3acf1bc1-e280-4ddc-8c29-476a1c8f98dd","block_type":"box","text":"degree or in a direction that is not anticipated. In addition, there is the risk that the perceived linkage","page_number":364,"box":{"x":116,"y":258,"width":748,"height":12}},{"id":"a677955b-52b4-457e-95cc-27fdd4354587","block_type":"box","text":"between various currencies may not be present, including during the particular time that a Fund is","page_number":364,"box":{"x":117,"y":273,"width":729,"height":12}},{"id":"27353f2b-6df9-4aa5-99fa-e44524d7683f","block_type":"box","text":"engaging in proxy hedging.","page_number":364,"box":{"x":116,"y":289,"width":206,"height":12}},{"id":"29b0b0ab-7e4c-49f7-bd10-dcd2d9d4bca4","block_type":"box","text":"A Fund may also cross-hedge currencies by entering into forward contracts to sell one or more","page_number":364,"box":{"x":116,"y":320,"width":708,"height":12}},{"id":"12624a2d-e59e-4ec4-a46a-b75ee9473487","block_type":"box","text":"currencies that are expected to decline in value relative to other currencies to which the Fund has or in","page_number":364,"box":{"x":116,"y":335,"width":766,"height":12}},{"id":"ee4102c5-f244-4304-af84-f3bf4acd04a3","block_type":"box","text":"which the Fund expects to have portfolio exposure. For example, a Fund may hold both Canadian","page_number":364,"box":{"x":116,"y":351,"width":731,"height":12}},{"id":"38749e0b-ac7c-49bd-a478-2cc3e2e4e598","block_type":"box","text":"government bonds and Japanese government bonds, and the Manager or sub-adviser may believe","page_number":364,"box":{"x":116,"y":366,"width":741,"height":12}},{"id":"d7ad4499-cd1b-4e20-932d-26605854fb61","block_type":"box","text":"that Canadian dollars will deteriorate against Japanese yen. The Fund would sell Canadian dollars to","page_number":364,"box":{"x":116,"y":382,"width":754,"height":12}},{"id":"a27431b6-fa57-4306-a163-cf8b1d6c1a4b","block_type":"box","text":"reduce its exposure to that currency and buy Japanese yen. This strategy would be a hedge against a","page_number":364,"box":{"x":117,"y":397,"width":761,"height":12}},{"id":"1ee3779b-0ea3-42c0-9af5-6339b81b7b7d","block_type":"box","text":"decline in the value of Canadian dollars, although it would expose the Fund to declines in the value of","page_number":364,"box":{"x":116,"y":413,"width":758,"height":12}},{"id":"99277789-7363-4c29-9018-01deb51f2300","block_type":"box","text":"the Japanese yen relative to the U.S. dollar.","page_number":364,"box":{"x":116,"y":428,"width":331,"height":12}},{"id":"1d8738fc-d424-4194-8f8f-3adf73f55b87","block_type":"box","text":"Some of the forward non-U.S. currency contracts entered into by the Funds are classified as","page_number":364,"box":{"x":116,"y":459,"width":690,"height":12}},{"id":"d7359580-6959-4ed1-a8a4-98e279bc5b42","block_type":"box","text":"non-deliverable forwards (“NDFs”). NDFs are cash-settled, short-term forward contracts that may be","page_number":364,"box":{"x":117,"y":475,"width":748,"height":12}},{"id":"05d336f0-9880-4989-8f87-3ced5379b967","block_type":"box","text":"thinly traded or are denominated in non-convertible foreign currency, where the profit or loss at the","page_number":364,"box":{"x":116,"y":490,"width":736,"height":12}},{"id":"aab0b6d3-eb69-432c-8086-92ac38ffb7f3","block_type":"box","text":"time at the settlement date is calculated by taking the difference between the agreed upon exchange","page_number":364,"box":{"x":116,"y":506,"width":752,"height":12}},{"id":"6a59b261-51d2-441c-a243-c0c8f377d168","block_type":"box","text":"rate and the spot rate at the time of settlement, for an agreed upon notional amount of funds. All NDFs","page_number":364,"box":{"x":117,"y":521,"width":765,"height":12}},{"id":"2f3c2251-76ed-4b1f-8247-6cf1d06f0869","block_type":"box","text":"have a fixing date and a settlement date. The fixing date is the date at which the difference between","page_number":364,"box":{"x":117,"y":537,"width":746,"height":12}},{"id":"69ee9c7a-dc78-4b77-a8e5-e3f8723416eb","block_type":"box","text":"the prevailing market exchange rate and the agreed upon exchange rate is calculated. The settlement","page_number":364,"box":{"x":116,"y":552,"width":761,"height":12}},{"id":"9895142b-7acd-439a-b256-a59c8488ae67","block_type":"box","text":"date is the date by which the payment of the difference is due to the party receiving payment. NDFs","page_number":364,"box":{"x":116,"y":568,"width":745,"height":12}},{"id":"81cdccf8-eda7-41b1-9764-6ec11331a73c","block_type":"box","text":"are commonly quoted for time periods of one month up to two years, and are normally quoted and","page_number":364,"box":{"x":116,"y":583,"width":733,"height":12}},{"id":"e8ccf9b2-e308-496d-9a7a-fdefa9ac93d2","block_type":"box","text":"settled in U.S. dollars. They are often used to gain exposure to and/or hedge exposure to foreign","page_number":364,"box":{"x":116,"y":599,"width":723,"height":12}},{"id":"04b9d1dc-b337-4874-9295-50c083cbac9b","block_type":"box","text":"currencies that are not internationally traded.","page_number":364,"box":{"x":116,"y":614,"width":337,"height":12}},{"id":"73e92051-e212-4cd1-9919-406465fa1495","block_type":"box","text":"Currency Futures.","page_number":364,"box":{"x":117,"y":645,"width":132,"height":12}},{"id":"f474dd2c-2a3f-45af-94bf-537b74555b12","block_type":"box","text":"A Fund may seek to enhance returns or hedge against the decline in the value of a","page_number":364,"box":{"x":250,"y":645,"width":626,"height":12}},{"id":"c76c2545-5363-43a8-85a2-b298f045ecde","block_type":"box","text":"currency through use of currency futures or options on currency futures. Currency futures are similar to","page_number":364,"box":{"x":116,"y":661,"width":764,"height":12}},{"id":"bca2a8c7-f32a-4b85-9075-0c51b6da79a3","block_type":"box","text":"forward foreign exchange transactions except that futures are standardized, exchange-traded contracts","page_number":364,"box":{"x":116,"y":676,"width":766,"height":12}},{"id":"bc1c8bd2-7791-4cbc-8476-bd4e6e40856d","block_type":"box","text":"while forward foreign exchange transactions are traded in the OTC market. Currency futures involve","page_number":364,"box":{"x":116,"y":692,"width":742,"height":12}},{"id":"14c1b1ee-1fe0-4feb-ba6d-6710f624753d","block_type":"box","text":"substantial currency risk as well as the risks discussed above in “— Futures.”","page_number":364,"box":{"x":116,"y":707,"width":572,"height":12}},{"id":"c4253b6b-9381-42b7-81bc-95c4a8f0c6a9","block_type":"box","text":"Currency Options.","page_number":364,"box":{"x":117,"y":738,"width":133,"height":12}},{"id":"95c88eaf-8202-4e99-9eee-945de0f21f0b","block_type":"box","text":"A Fund may seek to enhance returns or hedge against the decline in the value of a","page_number":364,"box":{"x":256,"y":738,"width":615,"height":12}},{"id":"3597a98c-772e-4691-875d-a9e568ff2b51","block_type":"box","text":"currency through the use of currency options. Certain Funds have fundamental investment restrictions","page_number":364,"box":{"x":116,"y":754,"width":758,"height":12}},{"id":"1a27faab-3057-4fad-8181-6795c1853c5c","block_type":"box","text":"that permit the purchase of currency options, but prohibit the writing of currency options. Currency","page_number":364,"box":{"x":116,"y":769,"width":727,"height":12}},{"id":"edb26471-d024-42d1-8f7e-2923dbb50a8f","block_type":"box","text":"options are similar to options on securities. For example, in consideration for an option premium the","page_number":364,"box":{"x":116,"y":785,"width":739,"height":12}},{"id":"00f38c91-7761-4690-bdbe-ca869e5252df","block_type":"box","text":"writer of a currency option is obligated to sell (in the case of a call option) or purchase (in the case of a","page_number":364,"box":{"x":116,"y":800,"width":760,"height":12}},{"id":"f4cedc2b-2b12-4ee3-a582-fbdc62d6899c","block_type":"box","text":"put option) a specified amount of a specified currency on or before the expiration date for a specified","page_number":364,"box":{"x":117,"y":816,"width":744,"height":12}},{"id":"3320cd74-f3aa-46df-be0d-c158fe2358b3","block_type":"box","text":"amount of another currency. A Fund may engage in transactions in options on currencies either on","page_number":364,"box":{"x":116,"y":831,"width":737,"height":12}},{"id":"7b131d89-ce08-4688-91a9-58c1c3265120","block_type":"box","text":"exchanges or OTC markets. Such transactions in options may include exotic options on currencies,","page_number":364,"box":{"x":116,"y":847,"width":743,"height":12}},{"id":"90bdced1-0dd4-49ad-9b72-c5e9bc42b6d7","block_type":"box","text":"which are typically traded in OTC markets and have additional features that result in different payment","page_number":364,"box":{"x":116,"y":862,"width":763,"height":12}},{"id":"12df8b5b-4cde-47e5-ae70-80e36065cce1","block_type":"box","text":"structures and/or expirations. Where a Fund is permitted to write currency options, it may write covered","page_number":364,"box":{"x":116,"y":878,"width":771,"height":12}},{"id":"5ec2af71-6ec2-42d5-b140-ee94b4c3b19c","block_type":"box","text":"II-32","page_number":364,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"45899a29-2022-4948-ab4e-6b7a1a1d2fea","block_type":"box","text":"NM1026U-6004382-364/605","page_number":364,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f765dc36-0746-4c7e-b0e5-498ccc498e0d","block_type":"box","text":"call options on up to 100% of the currencies in its portfolio. See “— Options” above. Currency options","page_number":365,"box":{"x":116,"y":87,"width":757,"height":12}},{"id":"d7556846-a239-4d0e-b98b-8ed702d23b45","block_type":"box","text":"involve substantial currency risk, and may also involve credit, leverage or illiquidity risk.","page_number":365,"box":{"x":117,"y":103,"width":651,"height":12}},{"id":"d9eacecc-a4db-4730-aaab-7a69bb06a01f","block_type":"box","text":"Currency Swaps.","page_number":365,"box":{"x":117,"y":134,"width":131,"height":12}},{"id":"f6bad847-81c4-4d47-95de-28a5f54a9d10","block_type":"box","text":"A Fund may enter into currency swaps in order to protect against currency","page_number":365,"box":{"x":248,"y":134,"width":557,"height":12}},{"id":"c695a277-2875-47dc-b6e7-eef66833a8b7","block_type":"box","text":"fluctuations or to hedge portfolio positions. Currency swaps are transactions in which one currency is","page_number":365,"box":{"x":116,"y":149,"width":754,"height":12}},{"id":"beb59797-fcc7-4887-98a4-b8b371df0a6c","block_type":"box","text":"simultaneously bought for a second currency on a spot basis and sold for the second currency on a","page_number":365,"box":{"x":116,"y":165,"width":743,"height":12}},{"id":"32857de6-cbab-4267-ba19-7ec2b57007cd","block_type":"box","text":"forward basis. Currency swaps involve the exchange of the rights of a Fund and another party to make","page_number":365,"box":{"x":116,"y":180,"width":767,"height":12}},{"id":"0d1832e1-965f-4ac8-abe0-4c43d33e38c2","block_type":"box","text":"or receive payments in specified currencies, and typically require the delivery of the entire principal","page_number":365,"box":{"x":116,"y":196,"width":738,"height":12}},{"id":"405d8581-c40a-4c64-b938-a74979c8907c","block_type":"box","text":"value of one designated currency in exchange for the other designated currency. As a result, the entire","page_number":365,"box":{"x":116,"y":211,"width":768,"height":12}},{"id":"5961a5ba-ae56-451f-b53f-781fc624b128","block_type":"box","text":"principal value of a currency swap is subject to the risk that the other party to the swap will default on","page_number":365,"box":{"x":117,"y":227,"width":753,"height":12}},{"id":"0fd3cc13-469d-4796-aa5a-212faa5c7f8b","block_type":"box","text":"its contractual delivery obligations.","page_number":365,"box":{"x":117,"y":242,"width":260,"height":12}},{"id":"d519693f-4f6b-427a-9332-0642ffab55c5","block_type":"box","text":"Digital Asset Exposure.","page_number":365,"box":{"x":116,"y":273,"width":192,"height":12}},{"id":"70d36bda-ad7b-455b-ba49-d20a63b2806b","block_type":"box","text":"Digital assets, such as bitcoin and ether, are created and transmitted through","page_number":365,"box":{"x":310,"y":273,"width":577,"height":12}},{"id":"13aec112-6e1d-4005-9a5b-caa4de2a3fd8","block_type":"box","text":"the operations of peer-to-peer networks of computers, known as nodes, that operate on cryptographic","page_number":365,"box":{"x":116,"y":289,"width":761,"height":12}},{"id":"da923be5-8791-413e-98e4-88e82257107d","block_type":"box","text":"computer-code based logic, called a protocol. Digital assets are part of a new and rapidly changing","page_number":365,"box":{"x":116,"y":304,"width":739,"height":12}},{"id":"150ca64a-0dbf-42d0-bd2c-5755778af3a0","block_type":"box","text":"industry, and the further development of digital asset networks is subject to a variety of factors that are","page_number":365,"box":{"x":117,"y":320,"width":765,"height":12}},{"id":"7c7d7e1a-fe6c-42cb-a6aa-b45820f66c1a","block_type":"box","text":"difficult to evaluate. Digital assets are relatively new assets with limited histories.","page_number":365,"box":{"x":116,"y":335,"width":602,"height":12}},{"id":"dfbf6d9b-8743-406d-8363-33c9a9add85f","block_type":"box","text":"Risks Related to Digital Assets.","page_number":365,"box":{"x":116,"y":366,"width":238,"height":12}},{"id":"d11eeeaa-3851-4adc-8147-72498ccaa0b0","block_type":"box","text":"Digital assets were only introduced within the past 15 years, and the","page_number":365,"box":{"x":355,"y":366,"width":511,"height":12}},{"id":"27e1d1a8-fff5-4b27-964d-5011ab577d1d","block_type":"box","text":"value of such digital assets is subject to a number of factors relating to the capabilities and","page_number":365,"box":{"x":116,"y":382,"width":676,"height":12}},{"id":"11e6b62e-f011-461d-8cd7-c30142209c3d","block_type":"box","text":"development of blockchain technologies, such as the recentness of their development, their","page_number":365,"box":{"x":116,"y":397,"width":685,"height":12}},{"id":"82c6aa87-6619-4a90-8899-9226511a716c","block_type":"box","text":"dependence on the internet and other technologies, their dependence on the role played by users,","page_number":365,"box":{"x":116,"y":413,"width":735,"height":12}},{"id":"8eee20bd-7b49-4445-a72c-3887ed7cdc48","block_type":"box","text":"developers, miners and validators and the potential for malicious activity. Given the recentness of the","page_number":365,"box":{"x":116,"y":428,"width":756,"height":12}},{"id":"a0bcda11-8208-47b0-8af3-576ed9742a58","block_type":"box","text":"development of digital asset networks, digital assets may not function as intended and parties may be","page_number":365,"box":{"x":116,"y":444,"width":760,"height":12}},{"id":"073a3f29-7bc0-4457-8b15-611e9e9d7528","block_type":"box","text":"unwilling to use digital assets, which would dampen the growth, if any, of digital asset networks.","page_number":365,"box":{"x":117,"y":459,"width":713,"height":12}},{"id":"226c66a0-57be-4c67-bf40-656f5d37f23e","block_type":"box","text":"The trading prices of many digital assets, including bitcoin and ether, have experienced extreme","page_number":365,"box":{"x":116,"y":490,"width":718,"height":12}},{"id":"48a1700c-cd67-471a-adbe-87b403e8051e","block_type":"box","text":"volatility in recent periods and may continue to do so. Extreme volatility in the future, including further","page_number":365,"box":{"x":116,"y":506,"width":755,"height":12}},{"id":"48682c55-746f-4c92-bd8b-3e59bbdcea7a","block_type":"box","text":"declines in the trading prices of bitcoin and ether, could have a material adverse effect on the value of","page_number":365,"box":{"x":116,"y":521,"width":760,"height":12}},{"id":"597358aa-749e-4630-91d9-51621dcef893","block_type":"box","text":"such digital asset investments. The value of digital assets is subject to a number of factors relating to","page_number":365,"box":{"x":116,"y":537,"width":754,"height":12}},{"id":"7bcc1676-f546-4523-ac31-7b36b7706a2b","block_type":"box","text":"the their fundamental investment characteristics, including the fact that digital assets are bearer","page_number":365,"box":{"x":116,"y":552,"width":714,"height":12}},{"id":"f132837b-e3c6-4722-baf5-be4406958a6f","block_type":"box","text":"instruments and loss, theft, destruction, or compromise of the associated private keys could result in","page_number":365,"box":{"x":117,"y":568,"width":748,"height":12}},{"id":"5a341120-ef80-4195-970e-2ef750bc8549","block_type":"box","text":"permanent loss of the asset, and the capabilities and development of blockchain technologies such as","page_number":365,"box":{"x":117,"y":583,"width":762,"height":12}},{"id":"9e345120-b337-4722-9cc0-e5c73fe6b33b","block_type":"box","text":"the Bitcoin or Ethereum blockchain.","page_number":365,"box":{"x":116,"y":599,"width":269,"height":9}},{"id":"79d95b86-7970-4f64-8da5-908b65dd61ed","block_type":"box","text":"The opaque nature of the digital asset market poses asset verification challenges for market","page_number":365,"box":{"x":116,"y":630,"width":688,"height":12}},{"id":"6471dd48-e2eb-4df4-a186-ca81d0b0ba38","block_type":"box","text":"participants, regulators and auditors and gives rise to an increased risk of manipulation and fraud,","page_number":365,"box":{"x":117,"y":645,"width":729,"height":12}},{"id":"a525eeba-2ed2-4d1e-ab77-0a60d15d554c","block_type":"box","text":"including the potential for Ponzi schemes, bucket shops and pump and dump schemes. Digital assets","page_number":365,"box":{"x":117,"y":661,"width":753,"height":12}},{"id":"61f624e6-44ca-483e-8ee9-6f0942f06a29","block_type":"box","text":"have in the past been used to facilitate illicit activities. If a digital asset was used to facilitate illicit","page_number":365,"box":{"x":117,"y":676,"width":715,"height":12}},{"id":"c4885ccd-302a-43a0-b766-f5b6628125db","block_type":"box","text":"activities, businesses that facilitate transactions in such digital assets could be at increased risk of","page_number":365,"box":{"x":116,"y":692,"width":727,"height":12}},{"id":"26922bda-f27b-49e7-aba5-84de5cb69c28","block_type":"box","text":"potential criminal or civil liability or lawsuits, or of having banking or other services cut off, and such","page_number":365,"box":{"x":117,"y":707,"width":734,"height":12}},{"id":"d72b6d6b-3f67-4e35-ab73-b5e6ab50d4ec","block_type":"box","text":"digital asset could be removed from digital asset platforms. Any of the aforementioned occurrences","page_number":365,"box":{"x":116,"y":723,"width":736,"height":12}},{"id":"acfd87ca-d9b2-45ae-8acf-560a99243e2f","block_type":"box","text":"could adversely affect the price of the relevant digital asset, the attractiveness of the respective","page_number":365,"box":{"x":116,"y":738,"width":706,"height":12}},{"id":"5ceda46e-2f92-4749-80eb-bb3c3142e502","block_type":"box","text":"blockchain network and investments in digital assets.","page_number":365,"box":{"x":117,"y":754,"width":392,"height":12}},{"id":"2994fe9d-1dca-4d93-96c9-de99f23c0650","block_type":"box","text":"If a malicious actor or botnet (a volunteer or hacked collection of computers controlled by networked","page_number":365,"box":{"x":117,"y":785,"width":741,"height":12}},{"id":"43cc129f-38f3-43fd-aea3-8099507da6e4","block_type":"box","text":"software coordinating the actions of the computers) obtains control of more than 50% of the processing","page_number":365,"box":{"x":116,"y":800,"width":765,"height":12}},{"id":"de927d05-bfb9-418a-b81e-13b1f33f0027","block_type":"box","text":"power dedicated to mining on the Bitcoin network, it may be able to alter the Bitcoin blockchain on","page_number":365,"box":{"x":117,"y":816,"width":725,"height":12}},{"id":"a6a9c441-4ed2-41a9-b57a-4b1edfd9e329","block_type":"box","text":"which transactions in bitcoin rely by constructing fraudulent blocks or preventing certain transactions","page_number":365,"box":{"x":116,"y":831,"width":749,"height":12}},{"id":"f762b3a8-5527-41cf-abee-e5eee91d2953","block_type":"box","text":"from completing in a timely manner, or at all. The malicious actor or botnet could also control, exclude","page_number":365,"box":{"x":116,"y":847,"width":761,"height":12}},{"id":"1cfceaef-dea1-4dde-a59d-248b4ea07087","block_type":"box","text":"or modify the ordering of transactions.","page_number":365,"box":{"x":116,"y":862,"width":287,"height":12}},{"id":"a2bd7f4c-221d-42f2-8e73-bb5536a18615","block_type":"box","text":"II-33","page_number":365,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"9d7e475d-d9e7-4c9a-9109-7f90f25114e6","block_type":"box","text":"NM1026U-6004382-365/605","page_number":365,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"8e0b3e44-e117-40eb-9d27-fefd6cc7a371","block_type":"box","text":"The Ethereum network is currently vulnerable to several types of attacks, including a:","page_number":366,"box":{"x":116,"y":87,"width":637,"height":12}},{"id":"74d652ec-80ab-45b8-a24a-b8c9177119c8","block_type":"box","text":"• “>33% attack” where, if a validator or group of validators were to gain control of more than","page_number":366,"box":{"x":159,"y":111,"width":698,"height":12}},{"id":"1594f138-59ec-427a-b51d-a407331a5848","block_type":"box","text":"33% of the total staked ether on the Ethereum network, a malicious actor could temporarily","page_number":366,"box":{"x":184,"y":127,"width":680,"height":12}},{"id":"aa2c87b2-ac8c-45b6-b9f3-65c5426da39c","block_type":"box","text":"impede or delay block confirmation or even cause a temporary fork in the blockchain. This is","page_number":366,"box":{"x":184,"y":142,"width":690,"height":12}},{"id":"2657b1d2-3c7a-4154-b7da-ea99a9c60627","block_type":"box","text":"believed to be temporary, as the Ethereum network’s inactivity leak would be expected to","page_number":366,"box":{"x":184,"y":158,"width":666,"height":12}},{"id":"fc595438-e37b-4d46-8656-5a21735c074b","block_type":"box","text":"eventually penalize the attacker enough for the chain to finalize again (i.e., the honest majority","page_number":366,"box":{"x":184,"y":173,"width":704,"height":12}},{"id":"af1f5b5f-c92a-4996-b345-ebdb0c06eec4","block_type":"box","text":"would be expected to reclaim 2/3rd stake as the attacker’s stake is penalized). However, it is","page_number":366,"box":{"x":183,"y":189,"width":693,"height":12}},{"id":"c693e87e-4d3d-46b1-ac40-e60bcba90912","block_type":"box","text":"not believed that with 33% control, a malicious actor could engage in double-spending or","page_number":366,"box":{"x":184,"y":204,"width":663,"height":12}},{"id":"7db7fd9d-f398-4cd3-9e59-3d49d554cd4c","block_type":"box","text":"fraudulent block propagation.","page_number":366,"box":{"x":183,"y":220,"width":222,"height":12}},{"id":"9ca74e74-5c1b-4b90-9782-1c4b3de41b18","block_type":"box","text":"• “>50% attack” where, if a validator or group of validators acting in concert were to gain control","page_number":366,"box":{"x":159,"y":244,"width":726,"height":12}},{"id":"6e70b684-cdcc-4401-8625-7f653f1f016c","block_type":"box","text":"of more than 50% of the total staked ether on the Ethereum network, a malicious actor would","page_number":366,"box":{"x":184,"y":259,"width":695,"height":11}},{"id":"788d0c45-7e6f-47ee-8327-d87eb97ba04e","block_type":"box","text":"be able to gain full control of the Ethereum network and the ability to manipulate future","page_number":366,"box":{"x":184,"y":275,"width":646,"height":12}},{"id":"8fead370-28c0-4e47-9d8f-bf0fe7c6e85a","block_type":"box","text":"transactions on the blockchain, including censoring transactions, double-spending and","page_number":366,"box":{"x":183,"y":290,"width":646,"height":12}},{"id":"babea5d4-9d6e-498b-9263-33e6381777ae","block_type":"box","text":"fraudulent block propagation, potentially for an extended period or even permanently. In","page_number":366,"box":{"x":183,"y":306,"width":657,"height":12}},{"id":"6b4b7146-e26f-43d8-afa1-9949109a7122","block_type":"box","text":"theory, the minority non-attackers might reach social consensus to reject blocks proposed by","page_number":366,"box":{"x":183,"y":321,"width":694,"height":12}},{"id":"a7c0a11a-0f07-426b-ab82-867d85704387","block_type":"box","text":"the malicious majority attacker, reducing the attacker’s ability to engage in malicious activity,","page_number":366,"box":{"x":183,"y":337,"width":690,"height":12}},{"id":"58b1cf7f-86d3-4955-b99c-20a9c0f78023","block_type":"box","text":"but there can be no assurance this would happen or that non-attackers would be able to","page_number":366,"box":{"x":184,"y":352,"width":658,"height":12}},{"id":"641b7570-9c7a-4d52-b364-b8f5fcd43a79","block_type":"box","text":"coordinate effectively.","page_number":366,"box":{"x":184,"y":368,"width":166,"height":12}},{"id":"61e9dfe8-b196-4ac0-9d41-0eeb3c168ad0","block_type":"box","text":"• “>66% attack” where, if a validator or group of validators acting in concert were to gain control","page_number":366,"box":{"x":159,"y":392,"width":726,"height":12}},{"id":"09078b18-a504-4c9a-8fa3-87cfc7c53a7d","block_type":"box","text":"of more than 66% of the total staked ether on the Ethereum network, a malicious actor could","page_number":366,"box":{"x":184,"y":407,"width":691,"height":12}},{"id":"be752f51-7a4a-4a24-b427-64f0bda3a2a7","block_type":"box","text":"permanently and irreversibly manipulate the blockchain, including censorship, double","page_number":366,"box":{"x":184,"y":423,"width":636,"height":12}},{"id":"cd5cdce3-43b0-4197-8907-1492331824e1","block_type":"box","text":"spending and fraudulent block propagation. The attacker could finalize their preferred chain","page_number":366,"box":{"x":184,"y":438,"width":682,"height":12}},{"id":"8ef1715a-cc31-4a15-9ae2-34cbd8f94820","block_type":"box","text":"without any consideration for the votes of other stakers and could also revert finalized blocks.","page_number":366,"box":{"x":183,"y":454,"width":697,"height":12}},{"id":"8f28d2a3-d07b-4b4d-8dfc-8299401edff6","block_type":"box","text":"The largest bitcoin and ether wallets are believed to hold, in aggregate, a significant percentage of the","page_number":366,"box":{"x":116,"y":487,"width":762,"height":12}},{"id":"1dc43bc0-f52b-4d13-a400-013be7e7649f","block_type":"box","text":"bitcoins and ether in circulation. Moreover, it is possible that other persons or entities control multiple","page_number":366,"box":{"x":117,"y":502,"width":752,"height":12}},{"id":"157c827c-faeb-46ce-9ad7-18df6d72ecbe","block_type":"box","text":"wallets that collectively hold a significant number of bitcoins or ether, even if they individually only hold","page_number":366,"box":{"x":116,"y":518,"width":764,"height":12}},{"id":"7d57c2e4-f1fa-459d-b389-3efda97434f8","block_type":"box","text":"a small amount, and it is possible that some of these wallets are controlled by the same person or","page_number":366,"box":{"x":116,"y":533,"width":731,"height":12}},{"id":"119e1e59-1369-4253-9a51-77640280fead","block_type":"box","text":"entity. As a result of this concentration of ownership, large sales or distributions by such holders could","page_number":366,"box":{"x":116,"y":549,"width":761,"height":12}},{"id":"defbeea8-5769-474d-ac65-d5f732ca9cf0","block_type":"box","text":"have an adverse effect on the market price of bitcoin or ether.","page_number":366,"box":{"x":117,"y":564,"width":462,"height":12}},{"id":"918cff11-12a9-4173-8221-de344b155433","block_type":"box","text":"Risks Related to Digital Assets as a Means of Payment.","page_number":366,"box":{"x":116,"y":597,"width":420,"height":12}},{"id":"6e87c658-3e51-4964-9108-ef5824d800ab","block_type":"box","text":"Digital assets such as bitcoin and ether have","page_number":366,"box":{"x":537,"y":597,"width":337,"height":12}},{"id":"cf51921a-3015-4da9-bd35-fcd6657d7f39","block_type":"box","text":"only recently become selectively accepted as a means of payment by retail and commercial outlets,","page_number":366,"box":{"x":116,"y":612,"width":744,"height":12}},{"id":"7394cb8c-8b37-45ec-a6c1-25fa37a8dfcc","block_type":"box","text":"and use of bitcoins or ether by consumers to pay such retail and commercial outlets remains limited.","page_number":366,"box":{"x":116,"y":628,"width":749,"height":12}},{"id":"b1cc4fe0-8cea-4b05-bd18-a22019a63ea0","block_type":"box","text":"Banks and other established financial institutions may refuse to process funds for bitcoin or ether","page_number":366,"box":{"x":117,"y":643,"width":723,"height":12}},{"id":"56b01873-65c9-4764-9662-65d5c0305d42","block_type":"box","text":"transactions; process wire transfers to or from digital asset platforms, bitcoin- or ether-related","page_number":366,"box":{"x":116,"y":659,"width":697,"height":12}},{"id":"526032b5-48e3-4b0a-8899-b80bb0130bdc","block_type":"box","text":"companies or service providers; or maintain accounts for persons or entities transacting in bitcoin or","page_number":366,"box":{"x":116,"y":674,"width":742,"height":12}},{"id":"ab0cab86-b834-407e-8ab6-d695eb75a69e","block_type":"box","text":"ether. As a result, the prices of bitcoin or ether may be influenced to a significant extent by speculators,","page_number":366,"box":{"x":116,"y":690,"width":765,"height":12}},{"id":"752e618c-47e7-4a75-b797-223293e6cd7c","block_type":"box","text":"and thus contributing to price volatility that makes retailers less likely to accept such digital assets as a","page_number":366,"box":{"x":116,"y":705,"width":760,"height":12}},{"id":"12461270-b509-4943-8f7d-3955c9bea2ea","block_type":"box","text":"form of payment in the future.","page_number":366,"box":{"x":116,"y":721,"width":218,"height":12}},{"id":"76206bff-e256-4d35-9eea-b1095710903b","block_type":"box","text":"In addition, as the speed of digital asset transactions and the number of transactions that can be","page_number":366,"box":{"x":117,"y":753,"width":714,"height":13}},{"id":"d97d2b72-c5f6-4e53-99de-8b0e91cf3ed8","block_type":"box","text":"processed lags behind growth in the use of digital asset networks, average fees and settlement times","page_number":366,"box":{"x":117,"y":769,"width":750,"height":12}},{"id":"caf4f26b-13d7-4ac5-8c7b-d76182afb80f","block_type":"box","text":"may increase considerably. For example, the Bitcoin network and Ethereum network have been, at","page_number":366,"box":{"x":117,"y":785,"width":733,"height":12}},{"id":"86b8a2b7-b15f-4d99-bda7-83355069b1ac","block_type":"box","text":"times, at capacity, which has led to increased transaction fees. Increased fees and decreased","page_number":366,"box":{"x":116,"y":800,"width":696,"height":12}},{"id":"edb6a223-8b6d-4051-a504-04995e16907d","block_type":"box","text":"settlement speeds could preclude certain uses for bitcoin or ether (e.g., micropayments), and could","page_number":366,"box":{"x":116,"y":815,"width":735,"height":13}},{"id":"2bfa8b7c-7f49-448f-a298-f8b30962b62f","block_type":"box","text":"reduce demand for, and the price of, bitcoin or ether. Bitcoin or Ethereum transactions are typically not","page_number":366,"box":{"x":117,"y":831,"width":765,"height":12}},{"id":"3bbaf583-c064-43c2-b337-28fcb16f4ac3","block_type":"box","text":"reversible without the consent and active participation of the recipient of the transaction. Once a","page_number":366,"box":{"x":117,"y":846,"width":716,"height":12}},{"id":"6cb00c85-76f4-4530-8087-22707a59d958","block_type":"box","text":"transaction has been verified and recorded in a block that is added to the Bitcoin or Ethereum","page_number":366,"box":{"x":116,"y":862,"width":700,"height":10}},{"id":"4b9e7ed6-e2a4-4f38-817c-cd4a33366d19","block_type":"box","text":"blockchain, an incorrect transfer or theft of bitcoin generally will not be reversible and a holder of","page_number":366,"box":{"x":117,"y":877,"width":718,"height":13}},{"id":"bcbc1d74-3f0a-4fa3-91d8-3039968fa9a8","block_type":"box","text":"II-34","page_number":366,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"b5dd1149-5aa1-499e-a205-c5733901b0af","block_type":"box","text":"NM1026U-6004382-366/605","page_number":366,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"919b273d-e0c4-451e-bc6f-a3520eaaaf91","block_type":"box","text":"bitcoin or ether, such as an ETP (as defined below), may not be capable of seeking compensation for","page_number":367,"box":{"x":117,"y":87,"width":757,"height":12}},{"id":"1463a74d-68c3-4f84-abf3-ea9904bda6d9","block_type":"box","text":"any such transfer or theft.","page_number":367,"box":{"x":116,"y":102,"width":195,"height":13}},{"id":"3d34ef69-9f2c-4bda-840a-734d26f58c2c","block_type":"box","text":"Risks Related to the Digital Asset Markets.","page_number":367,"box":{"x":116,"y":134,"width":322,"height":12}},{"id":"12e6e0a5-ccf2-4f08-81af-4cb0721ad2d0","block_type":"box","text":"Bitcoin and ether were among the first cryptographic digital","page_number":367,"box":{"x":440,"y":134,"width":441,"height":12}},{"id":"a38a467a-0c39-414b-8d6d-1590ab585f10","block_type":"box","text":"assets to gain global adoption and critical mass. In general, digital asset networks, including the Bitcoin","page_number":367,"box":{"x":116,"y":149,"width":771,"height":12}},{"id":"f4feca05-51b7-4e18-bdd4-15b58a267252","block_type":"box","text":"network, the Ethereum network and other cryptographic and algorithmic protocols governing the","page_number":367,"box":{"x":117,"y":165,"width":716,"height":12}},{"id":"a34e4873-1ee4-4a8a-8c5a-1707462d63f7","block_type":"box","text":"issuance of digital assets represent a new and rapidly evolving industry that is subject to a variety of","page_number":367,"box":{"x":117,"y":180,"width":746,"height":12}},{"id":"0ef767fd-dde3-4edf-bb4e-db96c024bf79","block_type":"box","text":"factors that are difficult to evaluate. In addition, many consortiums and financial institutions are also","page_number":367,"box":{"x":116,"y":196,"width":742,"height":12}},{"id":"5583bc15-9d18-456c-968a-1efb9fb8521c","block_type":"box","text":"researching and investing resources into private or permissioned smart contract platforms rather than","page_number":367,"box":{"x":117,"y":211,"width":757,"height":12}},{"id":"405bac5f-031b-4cb0-8622-50cc4af18489","block_type":"box","text":"open platforms like the Bitcoin network or the Ethereum network. Competition from the emergence or","page_number":367,"box":{"x":116,"y":227,"width":756,"height":12}},{"id":"e702500c-d64d-43cc-bbc2-cd1c5c6d7743","block_type":"box","text":"growth of alternative digital assets and smart contracts platforms, such as Solana, Avalanche,","page_number":367,"box":{"x":116,"y":242,"width":702,"height":12}},{"id":"41b5caf7-1154-4871-bd8a-72c6d830761d","block_type":"box","text":"Polkadot, or Cardano, could have a negative impact on","page_number":367,"box":{"x":117,"y":258,"width":413,"height":12}},{"id":"9ae62bd1-8071-4967-83c5-e6876f51c26f","block_type":"box","text":"the demand for, and price of, bitcoin or ether","page_number":367,"box":{"x":530,"y":258,"width":336,"height":11}},{"id":"d195a652-4b06-4f64-8c0d-0481e897cbd8","block_type":"box","text":"and thereby adversely affect the value of the bitcoin- or ether-related investments.","page_number":367,"box":{"x":116,"y":273,"width":614,"height":12}},{"id":"c12ab4b8-d787-477c-943c-16c4634af534","block_type":"box","text":"Moreover, in the past, bugs, defects and flaws in the source code for digital assets have been exposed","page_number":367,"box":{"x":117,"y":304,"width":767,"height":12}},{"id":"bd38cffe-0859-4074-965d-db0aeaaace1a","block_type":"box","text":"and exploited, including flaws that disabled some functionality for users, exposed users’ personal","page_number":367,"box":{"x":116,"y":320,"width":725,"height":12}},{"id":"7a8e3cd7-c315-44a1-9410-1d64617e2d4e","block_type":"box","text":"information and/or resulted in the theft of users’ digital assets. The cryptography underlying digital","page_number":367,"box":{"x":117,"y":335,"width":729,"height":12}},{"id":"257e7e14-87da-47a6-ad8a-5e998aa06e4e","block_type":"box","text":"asset networks or digital assets could prove to be flawed or ineffective, or developments in","page_number":367,"box":{"x":116,"y":351,"width":677,"height":12}},{"id":"3555c55c-973c-428d-9570-6a1e13a2b5d9","block_type":"box","text":"mathematics and/or technology, including advances in digital computing, algebraic geometry and","page_number":367,"box":{"x":117,"y":366,"width":724,"height":12}},{"id":"ab1d2301-75e6-4160-8c35-f8e320056c9c","block_type":"box","text":"quantum computing, could result in such cryptography becoming ineffective. In any of these","page_number":367,"box":{"x":116,"y":382,"width":686,"height":12}},{"id":"9f15afb0-f731-4c7a-bc3b-0399f4aedcbd","block_type":"box","text":"circumstances, a malicious actor may be able to compromise the security of digital asset networks or","page_number":367,"box":{"x":116,"y":397,"width":754,"height":12}},{"id":"3145423d-4635-4fe2-8b0a-8e21ebc75ceb","block_type":"box","text":"take a holder’s digital assets. Moreover, normal operations and functionality of digital asset networks","page_number":367,"box":{"x":116,"y":413,"width":751,"height":12}},{"id":"41a5b1d2-59bc-4c89-87c8-c0f8a59ea227","block_type":"box","text":"may be negatively affected such that it is no longer attractive to users or other stakeholders, thereby","page_number":367,"box":{"x":117,"y":428,"width":748,"height":12}},{"id":"3a31269b-6386-4412-b583-ee3395c24db7","block_type":"box","text":"dampening demand for such digital assets.","page_number":367,"box":{"x":116,"y":444,"width":324,"height":12}},{"id":"80141653-4b6e-4254-8260-d590c1fdb171","block_type":"box","text":"Digital Asset ETPs.","page_number":367,"box":{"x":116,"y":475,"width":148,"height":12}},{"id":"57757f09-083b-44e5-b35c-f4c9f867aa05","block_type":"box","text":"The Fund may acquire shares in exchange-traded products (“ETPs”) that seek to","page_number":367,"box":{"x":265,"y":475,"width":606,"height":12}},{"id":"7e1fe51c-bdaf-4c9a-9370-5c02a5d22487","block_type":"box","text":"reflect generally the performance of the price of bitcoin or ether by directly holding bitcoin (“Bitcoin","page_number":367,"box":{"x":117,"y":490,"width":731,"height":12}},{"id":"ab6ad2d4-66d7-47a0-8698-f31d20d06e51","block_type":"box","text":"ETPs”) or ether (“Ether ETPs”), including shares of a Bitcoin ETP or Ether ETP sponsored by an","page_number":367,"box":{"x":117,"y":506,"width":719,"height":12}},{"id":"632608ba-f1f5-4227-b1af-5abef07924ae","block_type":"box","text":"affiliate of BlackRock. The Fund will only invest in","page_number":367,"box":{"x":116,"y":521,"width":372,"height":12}},{"id":"6bd18cc4-1f56-4827-ba22-0d3ca7cd0238","block_type":"box","text":"Bitcoin ETPs or Ether ETPs that are listed and","page_number":367,"box":{"x":489,"y":521,"width":349,"height":10}},{"id":"90ce6bd6-6c94-41d4-9e51-c58d63b62e7d","block_type":"box","text":"traded on national securities exchanges. A Bitcoin ETP or an Ether ETP is not an investment company","page_number":367,"box":{"x":116,"y":537,"width":767,"height":12}},{"id":"8694204c-7da1-442d-8757-76f43ad2bab9","block_type":"box","text":"registered under the Investment Company Act of 1940, as amended, and therefore does not have the","page_number":367,"box":{"x":117,"y":552,"width":758,"height":12}},{"id":"8647789c-fff7-4ea7-8e04-964d1edd28e6","block_type":"box","text":"same investor protections as a registered investment company.","page_number":367,"box":{"x":116,"y":568,"width":476,"height":12}},{"id":"a658c0b3-43b1-4ca5-983e-5bdb69696751","block_type":"box","text":"Futures on Digital Assets.","page_number":367,"box":{"x":116,"y":599,"width":190,"height":12}},{"id":"5da7fd3e-93df-45d8-a220-310c7fa656cb","block_type":"box","text":"The Fund may invest in futures on Bitcoin and futures on Ethereum. See","page_number":367,"box":{"x":307,"y":599,"width":549,"height":12}},{"id":"d78065c8-a3f7-4c98-8254-7071c792a6bc","block_type":"box","text":"“Derivatives—General,” “Derivatives—Regulation of Derivatives” and “Derivatives—Risk Factors in","page_number":367,"box":{"x":116,"y":614,"width":738,"height":12}},{"id":"ea56f1d7-d1d2-489d-9d02-1ca6028d33df","block_type":"box","text":"Derivatives” below.","page_number":367,"box":{"x":117,"y":630,"width":146,"height":9}},{"id":"0aa13e57-33ab-4c09-a396-611e0cb83ae9","block_type":"box","text":"Distressed Securities.","page_number":367,"box":{"x":116,"y":661,"width":174,"height":9}},{"id":"a17c15fc-9d5a-4138-9ce8-a94187eb124d","block_type":"box","text":"A Fund may invest in securities, including loans purchased in the secondary","page_number":367,"box":{"x":296,"y":661,"width":565,"height":12}},{"id":"0d32dfad-dd71-4819-b665-2bebccd6e794","block_type":"box","text":"market, that are the subject of bankruptcy proceedings or otherwise in default or in risk of being in","page_number":367,"box":{"x":117,"y":676,"width":724,"height":12}},{"id":"ddb15452-e849-449f-be25-e9c19db294dc","block_type":"box","text":"default as to the repayment of principal and/or interest at the time of acquisition by the Fund or that are","page_number":367,"box":{"x":116,"y":692,"width":763,"height":12}},{"id":"f0810900-da6f-4ee8-a77e-a054c007f93d","block_type":"box","text":"rated in the lower rating categories by one or more nationally recognized statistical rating organizations","page_number":367,"box":{"x":117,"y":707,"width":762,"height":12}},{"id":"2e2a7180-7459-48be-9269-f81b249f6f0c","block_type":"box","text":"(for example, Ca or lower by Moody’s and CC or lower by S&P or Fitch) or, if unrated, are in the","page_number":367,"box":{"x":117,"y":723,"width":709,"height":12}},{"id":"fd66e958-092e-4b2d-adf1-fb4fd8dd97b6","block_type":"box","text":"judgment of the Manager of equivalent quality (“Distressed Securities”). Investment in Distressed","page_number":367,"box":{"x":115,"y":738,"width":719,"height":12}},{"id":"9d2f522b-2976-450e-99ba-5e8f1b65cd82","block_type":"box","text":"Securities is speculative and involves significant risks.","page_number":367,"box":{"x":116,"y":754,"width":399,"height":12}},{"id":"a6efdc48-ec7b-45e1-916d-bd3cee82a86a","block_type":"box","text":"A Fund will generally make such investments only when the Manager believes it is reasonably likely","page_number":367,"box":{"x":116,"y":785,"width":740,"height":12}},{"id":"506a136e-3861-46af-af77-21ffa3c54976","block_type":"box","text":"that the issuer of the Distressed Securities will make an exchange offer or will be the subject of a plan","page_number":367,"box":{"x":116,"y":800,"width":754,"height":12}},{"id":"736ea22c-5fdf-4d86-acb6-4584df67ea4d","block_type":"box","text":"of reorganization pursuant to which the Fund will receive new securities in return for the Distressed","page_number":367,"box":{"x":116,"y":816,"width":733,"height":12}},{"id":"b3d2037b-8f08-4718-aa7c-ee26e0fdaa03","block_type":"box","text":"Securities. However, there can be no assurance that such an exchange offer will be made or that such","page_number":367,"box":{"x":116,"y":831,"width":766,"height":12}},{"id":"6567d59c-0a9e-4b87-9592-44e2b2af567d","block_type":"box","text":"a plan of reorganization will be adopted. In addition, a significant period of time may pass between the","page_number":367,"box":{"x":116,"y":847,"width":762,"height":12}},{"id":"fbb4e788-7dad-4f6e-a612-d2a64b2b17ad","block_type":"box","text":"time at which a Fund makes its investment in Distressed Securities and the time that any such","page_number":367,"box":{"x":116,"y":862,"width":704,"height":12}},{"id":"f82b9c24-107f-477e-8e18-2af75f6e3bfd","block_type":"box","text":"exchange offer or plan of reorganization is completed. During this period, it is unlikely that a Fund will","page_number":367,"box":{"x":116,"y":878,"width":756,"height":12}},{"id":"2e5b2887-aa37-499b-8253-f2e67b0eb960","block_type":"box","text":"II-35","page_number":367,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"9f09f9aa-f3b2-4f5b-b793-9ded57de74a6","block_type":"box","text":"NM1026U-6004382-367/605","page_number":367,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f5db03c0-cf88-4b95-996d-28255f83c091","block_type":"box","text":"receive any interest payments on the Distressed Securities, the Fund will be subject to significant","page_number":368,"box":{"x":117,"y":87,"width":725,"height":12}},{"id":"11ddd08d-e880-441d-b326-f46a83721552","block_type":"box","text":"uncertainty as to whether or not the exchange offer or plan of reorganization will be completed and the","page_number":368,"box":{"x":117,"y":102,"width":764,"height":13}},{"id":"c61f1b08-4e94-4317-bebc-775b0836499b","block_type":"box","text":"Fund may be required to bear certain extraordinary expenses to protect and recover its investment.","page_number":368,"box":{"x":117,"y":118,"width":741,"height":12}},{"id":"e81e3828-c6a4-48f5-84ee-62b4f97a4b5e","block_type":"box","text":"Therefore, to the extent the Fund seeks capital appreciation through investment in distressed","page_number":368,"box":{"x":116,"y":134,"width":696,"height":12}},{"id":"90163355-c989-4b6a-940c-d637ca66b785","block_type":"box","text":"securities, the Fund’s ability to achieve current income for its shareholders may be diminished. The","page_number":368,"box":{"x":116,"y":149,"width":740,"height":12}},{"id":"327e27f7-5a3b-401d-8bee-b2fa80ee98dd","block_type":"box","text":"Fund also will be subject to significant uncertainty as to when and in what manner and for what value","page_number":368,"box":{"x":117,"y":165,"width":753,"height":12}},{"id":"fa3de669-9f95-4d2f-810d-2fd184eeec83","block_type":"box","text":"the obligations evidenced by the distressed securities will eventually be satisfied (","page_number":368,"box":{"x":116,"y":180,"width":605,"height":12}},{"id":"27d5a9b8-88fe-4c72-9235-651f03287a85","block_type":"box","text":"e.g.","page_number":368,"box":{"x":723,"y":183,"width":25,"height":9}},{"id":"bb2fd3cf-4227-4620-b76f-0d881518eee6","block_type":"box","text":", through a","page_number":368,"box":{"x":751,"y":180,"width":84,"height":12}},{"id":"086e7eee-c617-4cba-829c-a147a7205cb6","block_type":"box","text":"liquidation of the obligor’s assets, an exchange offer or plan of reorganization involving the distressed","page_number":368,"box":{"x":117,"y":196,"width":756,"height":12}},{"id":"d78d54e9-9f6c-4cc9-9d0b-1b54081e01e4","block_type":"box","text":"securities or a payment of some amount in satisfaction of the obligation). Even if an exchange offer is","page_number":368,"box":{"x":116,"y":211,"width":757,"height":12}},{"id":"cd5ea909-c317-4d79-acce-dc3af22b06ca","block_type":"box","text":"made or plan of reorganization is adopted with respect to Distressed Securities held by a Fund, there","page_number":368,"box":{"x":117,"y":227,"width":754,"height":12}},{"id":"6b94f0d1-b160-4bf3-bb03-c885977b057d","block_type":"box","text":"can be no assurance that the securities or other assets received by a Fund in connection with such","page_number":368,"box":{"x":116,"y":242,"width":740,"height":12}},{"id":"9d5bab89-2551-476f-bbee-da12b79709e3","block_type":"box","text":"exchange offer or plan of reorganization will not have a lower value or income potential than may have","page_number":368,"box":{"x":116,"y":258,"width":765,"height":12}},{"id":"5d759628-d8a0-4ebe-917e-674db29719ff","block_type":"box","text":"been anticipated when the investment was made or no value. Moreover, any securities received by a","page_number":368,"box":{"x":117,"y":273,"width":753,"height":12}},{"id":"c0c7fd10-1691-44c7-85c3-c827ca91e4b4","block_type":"box","text":"Fund upon completion of an exchange offer or plan of reorganization may be restricted as to resale.","page_number":368,"box":{"x":117,"y":289,"width":745,"height":12}},{"id":"e385f1dd-dc28-41f9-9e86-33ecaab32c17","block_type":"box","text":"Similarly, if a Fund participates in negotiations with respect to any exchange offer or plan of","page_number":368,"box":{"x":116,"y":304,"width":683,"height":12}},{"id":"f4da7a5d-b9bf-47fe-a1e2-8091999f2a58","block_type":"box","text":"reorganization with respect to an issuer of Distressed Securities, the Fund may be restricted from","page_number":368,"box":{"x":117,"y":320,"width":726,"height":12}},{"id":"4500d125-4896-491e-b1e5-b47163bcf748","block_type":"box","text":"disposing of such securities. To the extent that a Fund becomes involved in such proceedings, the","page_number":368,"box":{"x":116,"y":335,"width":734,"height":12}},{"id":"ed7290e7-2030-429a-b675-a9ddb0dc2973","block_type":"box","text":"Fund may have a more active participation in the affairs of the issuer than that assumed generally by","page_number":368,"box":{"x":117,"y":351,"width":752,"height":12}},{"id":"600f8210-7875-4f6a-9789-125961298968","block_type":"box","text":"an investor. The Fund, however, will not make investments for the purpose of exercising day-to-day","page_number":368,"box":{"x":116,"y":366,"width":744,"height":12}},{"id":"adfd1f26-968b-4d7a-85d4-7ff50731eb7b","block_type":"box","text":"management of any issuer’s affairs.","page_number":368,"box":{"x":117,"y":382,"width":269,"height":12}},{"id":"1ec86968-8538-4b1f-a38a-8f28cb4468f3","block_type":"box","text":"Environmental, Social and Governance (“ESG”) Integration.","page_number":368,"box":{"x":116,"y":413,"width":476,"height":12}},{"id":"5d1fe88a-7606-42ca-a8c2-6edbe6475811","block_type":"box","text":"Although a Fund does not seek to","page_number":368,"box":{"x":593,"y":413,"width":261,"height":12}},{"id":"fd0ea740-9dd0-4b59-a588-fd0d56524f63","block_type":"box","text":"implement a specific sustainability objective, strategy or process unless disclosed in its Prospectus,","page_number":368,"box":{"x":117,"y":428,"width":741,"height":12}},{"id":"1d7b92de-9509-4ed7-93c7-996ae95a8ecc","block_type":"box","text":"Fund management will consider ESG factors as part of the investment process for the Fund. Fund","page_number":368,"box":{"x":117,"y":444,"width":733,"height":12}},{"id":"f5ba7ec7-b46d-490b-ab6d-dd005294b4bd","block_type":"box","text":"management views ESG integration as the practice of incorporating financially material ESG data or","page_number":368,"box":{"x":117,"y":459,"width":747,"height":12}},{"id":"66d117db-03df-4232-be3e-f11f7ea768eb","block_type":"box","text":"information into investment processes with the objective of enhancing risk-adjusted returns. These","page_number":368,"box":{"x":117,"y":475,"width":734,"height":12}},{"id":"edf72482-7e39-46b4-bfe7-1155ec485630","block_type":"box","text":"ESG considerations will vary depending on a Fund’s particular investment strategies and may include","page_number":368,"box":{"x":117,"y":490,"width":757,"height":12}},{"id":"2cfee189-ded5-4f3c-b461-1570c842cc64","block_type":"box","text":"consideration of third-party research as well as consideration of proprietary BlackRock research across","page_number":368,"box":{"x":116,"y":506,"width":770,"height":12}},{"id":"9e72d57a-4c58-44b6-a501-063148ff3672","block_type":"box","text":"the ESG risks and opportunities regarding an issuer. The ESG characteristics utilized in a Fund’s","page_number":368,"box":{"x":116,"y":521,"width":725,"height":12}},{"id":"8d7da8a1-236e-474d-84b9-927ecbd08e4a","block_type":"box","text":"investment process are anticipated to evolve over time and one or more characteristics may not be","page_number":368,"box":{"x":117,"y":537,"width":738,"height":12}},{"id":"84b35404-99c5-47f6-a303-50dfe0e66665","block_type":"box","text":"relevant with respect to all issuers that are eligible for investment.","page_number":368,"box":{"x":117,"y":552,"width":490,"height":12}},{"id":"cd780498-f56d-48a3-9b63-e4fb9b90d531","block_type":"box","text":"Certain of these considerations may affect a Fund’s exposure to certain companies or industries. While","page_number":368,"box":{"x":117,"y":583,"width":769,"height":12}},{"id":"3a888c0b-ffa2-4362-a53b-3b0f92b35c6e","block_type":"box","text":"Fund management views ESG considerations as having the potential to contribute to a Fund’s long","page_number":368,"box":{"x":117,"y":599,"width":740,"height":12}},{"id":"e5670866-ea82-48b2-9a7a-4df1492a858b","block_type":"box","text":"term performance, there is no guarantee that such results will be achieved.","page_number":368,"box":{"x":116,"y":614,"width":561,"height":12}},{"id":"13e39123-ff14-4a3f-91c9-b9159013ffca","block_type":"box","text":"Equity Securities.","page_number":368,"box":{"x":116,"y":645,"width":140,"height":12}},{"id":"9c3a50db-b41e-4bb4-8bb7-43f8489155cf","block_type":"box","text":"Certain Funds may invest in equity securities, which include common stock and, for","page_number":368,"box":{"x":257,"y":645,"width":629,"height":12}},{"id":"a1667d0c-5711-423f-a38c-7244862937d0","block_type":"box","text":"certain Funds, preferred stock (including convertible preferred stock); bonds; stock purchase warrants","page_number":368,"box":{"x":116,"y":661,"width":755,"height":12}},{"id":"8cb73f94-0f00-4cde-8e3f-3f4918cf5034","block_type":"box","text":"and rights; equity interests in trusts; general and limited partnerships and limited liability companies;","page_number":368,"box":{"x":116,"y":676,"width":739,"height":12}},{"id":"5fea7bd4-00d8-4f78-b0cd-3ab0771f9435","block_type":"box","text":"and depositary receipts. Stock markets are volatile. The price of equity securities will fluctuate and can","page_number":368,"box":{"x":116,"y":692,"width":759,"height":12}},{"id":"3f713ed1-f69e-4663-9295-ca91b4c3407b","block_type":"box","text":"decline and reduce the value of a portfolio investing in equities. The price of equity securities fluctuates","page_number":368,"box":{"x":116,"y":707,"width":763,"height":12}},{"id":"636be515-4054-4c18-930d-8717bb68bb9a","block_type":"box","text":"based on changes in a company’s financial condition and overall market and economic conditions. The","page_number":368,"box":{"x":117,"y":723,"width":762,"height":12}},{"id":"2cae0ec9-5218-4fda-9cf2-4a194a0be76f","block_type":"box","text":"value of equity securities purchased by the Fund could decline if the financial condition of the","page_number":368,"box":{"x":116,"y":738,"width":689,"height":12}},{"id":"d74a8cdb-f07a-4f8a-b972-ad5f6799e4f8","block_type":"box","text":"companies the Fund invests in decline or if overall market and economic conditions deteriorate. They","page_number":368,"box":{"x":116,"y":754,"width":750,"height":12}},{"id":"9414937c-d865-4b1b-ac83-b12e0470ec57","block_type":"box","text":"may also decline due to factors that affect a particular industry or industries, such as labor shortages or","page_number":368,"box":{"x":117,"y":769,"width":766,"height":12}},{"id":"809ced8e-2a34-4761-aa23-d5c89052045c","block_type":"box","text":"increase in production costs and competitive conditions within an industry. In addition, they may","page_number":368,"box":{"x":117,"y":785,"width":710,"height":12}},{"id":"d3f96895-96ea-4460-97bb-e5576b019af2","block_type":"box","text":"decline due to general market conditions that are not specifically related to a company or industry,","page_number":368,"box":{"x":116,"y":800,"width":726,"height":12}},{"id":"92efd452-f6e5-49c8-a686-9bfb89a6358e","block_type":"box","text":"such as real or perceived adverse economic conditions, changes in the general outlook for corporate","page_number":368,"box":{"x":116,"y":816,"width":748,"height":12}},{"id":"445051fc-ba29-4d44-831b-e755b9c40afa","block_type":"box","text":"earnings, changes in interest or currency rates or generally adverse investor sentiment.","page_number":368,"box":{"x":116,"y":831,"width":654,"height":12}},{"id":"262a470d-35f0-42b3-8d2f-fa89aa3f059d","block_type":"box","text":"From time to time certain of the Funds may invest in shares of companies through initial public","page_number":368,"box":{"x":117,"y":862,"width":704,"height":12}},{"id":"db380bee-10c4-4cff-9e90-392c7435a2e7","block_type":"box","text":"offerings (“IPOs”). IPOs have the potential to produce, and have in fact produced, substantial gains for","page_number":368,"box":{"x":116,"y":878,"width":764,"height":12}},{"id":"bc49296b-f566-4e3d-ac3f-b8957468d76f","block_type":"box","text":"II-36","page_number":368,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"6bdee8bb-94b6-4b61-b820-81db78030a05","block_type":"box","text":"NM1026U-6004382-368/605","page_number":368,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"0f0ad971-3c48-4d4e-a951-1c907f2827dc","block_type":"box","text":"certain Funds. There is no assurance that any Fund will have continued access to profitable IPOs and","page_number":369,"box":{"x":116,"y":87,"width":761,"height":12}},{"id":"5673d6b7-2724-4226-b739-47075dce9511","block_type":"box","text":"therefore investors should not rely on these past gains as an indication of future performance. The","page_number":369,"box":{"x":116,"y":102,"width":734,"height":13}},{"id":"fe105289-36fb-4b78-a4cf-f1dee7d9227c","block_type":"box","text":"investment performance of a Fund during periods when it is unable to invest significantly or at all in","page_number":369,"box":{"x":117,"y":118,"width":738,"height":12}},{"id":"94d72426-d258-48bd-836b-e73b1cb44798","block_type":"box","text":"IPOs may be lower than during periods when it is able to do so. In addition, as a Fund increases in","page_number":369,"box":{"x":117,"y":134,"width":736,"height":12}},{"id":"746edb8c-832f-4beb-a341-caf1297dcc16","block_type":"box","text":"size, the impact of IPOs on its performance will generally decrease. Securities issued in IPOs are","page_number":369,"box":{"x":116,"y":149,"width":727,"height":12}},{"id":"1ed15bf7-e653-42a9-85c8-50e602fc9d89","block_type":"box","text":"subject to many of the same risks as investing in companies with smaller market capitalizations.","page_number":369,"box":{"x":116,"y":165,"width":717,"height":12}},{"id":"27772cc2-df3a-4645-8e10-3752640afca1","block_type":"box","text":"Securities issued in IPOs have no trading history, and information about the companies may be","page_number":369,"box":{"x":116,"y":180,"width":713,"height":12}},{"id":"65a88336-f85f-41a9-87d8-7de70c68d0cc","block_type":"box","text":"available for very limited periods. In addition, the prices of securities sold in IPOs may be highly volatile","page_number":369,"box":{"x":116,"y":196,"width":770,"height":12}},{"id":"adbc5f0f-faf2-4515-b058-f726a7358dfb","block_type":"box","text":"or may decline shortly after the initial public offering.","page_number":369,"box":{"x":116,"y":211,"width":392,"height":12}},{"id":"1a2be25b-c81e-4067-9f2a-61c20544fd42","block_type":"box","text":"The Funds may invest in companies that have relatively small market capitalizations. These","page_number":369,"box":{"x":116,"y":242,"width":685,"height":12}},{"id":"f98b24d0-5b4e-4a01-a1c4-c96456796d98","block_type":"box","text":"organizations will normally have more limited product lines, markets and financial resources and will be","page_number":369,"box":{"x":116,"y":258,"width":769,"height":12}},{"id":"04fff1e0-4f39-4493-90c3-1b7753d19be9","block_type":"box","text":"dependent upon a more limited management group than larger capitalized companies. In addition, it is","page_number":369,"box":{"x":116,"y":273,"width":764,"height":12}},{"id":"1b5f1cac-1026-42b4-9b60-9923219766e6","block_type":"box","text":"more difficult to get information on smaller companies, which tend to be less well known, have shorter","page_number":369,"box":{"x":117,"y":289,"width":758,"height":12}},{"id":"c93c89d8-6582-47d1-82c4-27f6285ee96d","block_type":"box","text":"operating histories, do not have significant ownership by large investors and are followed by relatively","page_number":369,"box":{"x":116,"y":304,"width":758,"height":12}},{"id":"2d86188a-4b2c-4fba-9141-a4831d359eb7","block_type":"box","text":"few securities analysts. The securities of smaller capitalized companies are often traded in the OTC","page_number":369,"box":{"x":116,"y":320,"width":744,"height":12}},{"id":"57bd09dc-c13b-47de-a209-efa0ae04aee6","block_type":"box","text":"markets and may have fewer market makers and wider price spreads. This may result in greater price","page_number":369,"box":{"x":117,"y":335,"width":760,"height":12}},{"id":"9ffb0899-cfce-481a-ada5-ba09826414f2","block_type":"box","text":"movements and less ability to sell a Fund’s investment than if the Fund held the securities of larger,","page_number":369,"box":{"x":117,"y":351,"width":743,"height":12}},{"id":"2e069ddd-f665-4d7d-a5c9-659dc46335a1","block_type":"box","text":"more established companies.","page_number":369,"box":{"x":117,"y":366,"width":222,"height":12}},{"id":"46000837-3c74-4e7b-a4fb-9fbd00e00009","block_type":"box","text":"For a discussion of the types of equity securities in which your Fund may invest and the risks","page_number":369,"box":{"x":117,"y":397,"width":693,"height":12}},{"id":"fc3a5467-441c-4ab6-9f1d-a3cef5e75951","block_type":"box","text":"associated with investing in such equity securities, see your Fund’s Prospectus. Certain of the Funds","page_number":369,"box":{"x":116,"y":413,"width":754,"height":12}},{"id":"28c76137-60d5-45bf-8c23-1846db0251be","block_type":"box","text":"may also invest in shares of private companies, which are subject to the risks of “Illiquid Investments”","page_number":369,"box":{"x":117,"y":428,"width":756,"height":12}},{"id":"479259f2-f34d-4413-bcb3-f3d399570643","block_type":"box","text":"and “Restricted Securities” described below.","page_number":369,"box":{"x":116,"y":444,"width":334,"height":9}},{"id":"bbed7b68-5463-4a09-8786-f44bbed2ff79","block_type":"box","text":"Real Estate-Related Securities.","page_number":369,"box":{"x":116,"y":475,"width":232,"height":9}},{"id":"841c25a9-1083-474f-8851-b728bfe51f14","block_type":"box","text":"Although no Fund may invest directly in real estate, certain Funds may","page_number":369,"box":{"x":349,"y":475,"width":535,"height":12}},{"id":"1c65768e-8d9d-4471-be09-e72fd87305dc","block_type":"box","text":"invest in equity securities of issuers that are principally engaged in the real estate industry. Such","page_number":369,"box":{"x":117,"y":490,"width":719,"height":12}},{"id":"e857b25d-580e-4feb-8f3d-bf5b64dbdcc7","block_type":"box","text":"investments are subject to certain risks associated with the ownership of real estate and with the real","page_number":369,"box":{"x":117,"y":506,"width":753,"height":12}},{"id":"0493dccd-b6af-4ed6-93b1-ad1ef3a32422","block_type":"box","text":"estate industry in general. These risks include, among others: possible declines in the value of real","page_number":369,"box":{"x":116,"y":521,"width":738,"height":12}},{"id":"5b530384-edce-40a9-beef-8838030caf10","block_type":"box","text":"estate; risks related to general and local economic conditions; possible lack of availability of mortgage","page_number":369,"box":{"x":116,"y":537,"width":760,"height":12}},{"id":"aa1632d3-701f-4c49-8138-c260c6f8e96c","block_type":"box","text":"funds or other limitations on access to capital; overbuilding; risks associated with leverage; market","page_number":369,"box":{"x":116,"y":552,"width":734,"height":12}},{"id":"dafae426-d34b-4c4d-bcd3-b4861fb5c868","block_type":"box","text":"illiquidity; extended vacancies of properties; increase in competition, property taxes, capital","page_number":369,"box":{"x":117,"y":568,"width":679,"height":12}},{"id":"3472e7ac-5994-4db8-8317-ab24a8fbf5f0","block_type":"box","text":"expenditures and operating expenses; changes in zoning laws or other governmental regulation; costs","page_number":369,"box":{"x":116,"y":583,"width":765,"height":12}},{"id":"110c3cfd-6872-4fee-a493-9aa252f9c411","block_type":"box","text":"resulting from the clean-up of, and liability to third parties for damages resulting from, environmental","page_number":369,"box":{"x":117,"y":599,"width":746,"height":12}},{"id":"5de785ed-4c48-4dd0-88a8-ca5db6e9be8b","block_type":"box","text":"problems; tenant bankruptcies or other credit problems; casualty or condemnation losses; uninsured","page_number":369,"box":{"x":117,"y":614,"width":748,"height":12}},{"id":"3a6aa25b-0eb7-455e-8162-7767935484f5","block_type":"box","text":"damages from floods, earthquakes or other natural disasters; limitations on and variations in rents,","page_number":369,"box":{"x":116,"y":630,"width":736,"height":12}},{"id":"ea4ccce6-d694-4a2e-a125-2031930c903c","block_type":"box","text":"including decreases in market rates for rents; investment in developments that are not completed or","page_number":369,"box":{"x":117,"y":645,"width":745,"height":12}},{"id":"72274e4c-b090-40e5-9a24-3ec5464266cd","block_type":"box","text":"that are subject to delays in completion; and changes in interest rates. To the extent that assets","page_number":369,"box":{"x":116,"y":661,"width":710,"height":12}},{"id":"e7b0c552-3948-4dfa-877b-57ba947a2516","block_type":"box","text":"underlying a Fund’s investments are concentrated geographically, by property type or in certain other","page_number":369,"box":{"x":117,"y":676,"width":750,"height":12}},{"id":"7ecc6341-c731-40b9-818a-d3bff7a5cb7d","block_type":"box","text":"respects, the Fund may be subject to certain of the foregoing risks to a greater extent. Investments by","page_number":369,"box":{"x":117,"y":692,"width":755,"height":12}},{"id":"371bbb59-ba94-4b54-8cc4-76c261c434a3","block_type":"box","text":"a Fund in securities of companies providing mortgage servicing will be subject to the risks associated","page_number":369,"box":{"x":116,"y":707,"width":750,"height":12}},{"id":"cc44ea2d-019f-4d15-a964-2a2bfe738420","block_type":"box","text":"with refinancings and their impact on servicing rights.","page_number":369,"box":{"x":116,"y":723,"width":393,"height":12}},{"id":"816e9fea-ef95-4f01-8b6e-ac050daedea1","block_type":"box","text":"In addition, if a Fund receives rental income or income from the disposition of real property acquired as","page_number":369,"box":{"x":117,"y":754,"width":763,"height":12}},{"id":"a6ebfc7d-c9dc-4c6d-b0f3-d42c84586b8a","block_type":"box","text":"a result of a default on securities the Fund owns, the receipt of such income may adversely affect the","page_number":369,"box":{"x":116,"y":769,"width":750,"height":12}},{"id":"216e18e2-d42f-434c-a0de-fd509e131cb5","block_type":"box","text":"Fund’s ability to retain its tax status as a regulated investment company because of certain income","page_number":369,"box":{"x":117,"y":785,"width":732,"height":12}},{"id":"b055f91f-f44b-4af3-9e1b-3df14d3aabb7","block_type":"box","text":"source requirements applicable to regulated investment companies under the Internal Revenue Code","page_number":369,"box":{"x":116,"y":800,"width":752,"height":12}},{"id":"9ddc04bf-1aec-4c6b-9ec1-42f6fe582e7b","block_type":"box","text":"of 1986, as amended (the “Code”).","page_number":369,"box":{"x":116,"y":816,"width":257,"height":12}},{"id":"22d23e6f-c440-41ae-9cc4-a681ba56c55f","block_type":"box","text":"Securities of Smaller or Emerging Growth Companies.","page_number":369,"box":{"x":117,"y":847,"width":401,"height":12}},{"id":"50b7fde3-d090-47e2-8f71-f820830e6ef2","block_type":"box","text":"Investment in smaller or emerging growth","page_number":369,"box":{"x":520,"y":847,"width":318,"height":12}},{"id":"fa6d4eb4-95b1-403d-8d66-efe92a177077","block_type":"box","text":"companies involves greater risk than is customarily associated with investments in more established","page_number":369,"box":{"x":116,"y":862,"width":749,"height":12}},{"id":"7c47a9b5-4c39-4743-96fc-61bc4e8fc19f","block_type":"box","text":"companies. The securities of smaller or emerging growth companies may be subject to more abrupt or","page_number":369,"box":{"x":116,"y":878,"width":765,"height":12}},{"id":"976ab1f5-6f8f-4d09-a4ad-1ed8396a2fef","block_type":"box","text":"II-37","page_number":369,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"4ad87d76-315b-4755-a606-ea0c9806cb5f","block_type":"box","text":"NM1026U-6004382-369/605","page_number":369,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"20f17c38-c9ef-475e-96aa-1b67b718deaf","block_type":"box","text":"erratic market movements than larger, more established companies or the market average in general.","page_number":370,"box":{"x":116,"y":87,"width":761,"height":12}},{"id":"92d35330-cf43-43e4-a686-11cb9967bd46","block_type":"box","text":"These companies may have limited product lines, markets or financial resources, or they may be","page_number":370,"box":{"x":116,"y":102,"width":723,"height":13}},{"id":"fc11072f-7669-4900-bf52-3db75b0a6926","block_type":"box","text":"dependent on a limited management group.","page_number":370,"box":{"x":116,"y":118,"width":330,"height":12}},{"id":"6af24e80-e378-4747-b87e-af89d8ec20fb","block_type":"box","text":"Investments in smaller or emerging growth companies may involve greater risks and thus may be","page_number":370,"box":{"x":117,"y":149,"width":727,"height":12}},{"id":"8de800a7-e823-427c-ac7a-4730b2597d46","block_type":"box","text":"considered speculative. Full development of these companies and trends frequently takes time.","page_number":370,"box":{"x":116,"y":165,"width":713,"height":12}},{"id":"7c8a052a-61f2-453f-8c19-465e65d92e8f","block_type":"box","text":"Small cap and emerging growth securities will often be traded only in the OTC market or on a regional","page_number":370,"box":{"x":116,"y":196,"width":762,"height":12}},{"id":"b82d2638-19fc-4ec0-8c0d-1f12c2ef30ab","block_type":"box","text":"securities exchange and may not be traded every day or in the volume typical of trading on a national","page_number":370,"box":{"x":116,"y":211,"width":757,"height":12}},{"id":"d681782d-d8b4-4790-93d7-fc5c421ad562","block_type":"box","text":"securities exchange. As a result, the disposition by a Fund of portfolio securities to meet redemptions","page_number":370,"box":{"x":116,"y":227,"width":756,"height":12}},{"id":"383a7c4c-ff96-4abe-bc41-abe50bec983c","block_type":"box","text":"or otherwise may require the Fund to make many small sales over a lengthy period of time, or to sell","page_number":370,"box":{"x":116,"y":242,"width":749,"height":12}},{"id":"22577882-990d-450f-8088-ac59c2c9ec38","block_type":"box","text":"these securities at a discount from market prices or during periods when, in Fund management’s","page_number":370,"box":{"x":116,"y":258,"width":722,"height":12}},{"id":"3c690364-7c57-4856-ba5a-3482c6016612","block_type":"box","text":"judgment, such disposition is not desirable.","page_number":370,"box":{"x":115,"y":273,"width":326,"height":12}},{"id":"7790e78a-4cb5-4ee3-bd8c-7a2c66ec3636","block_type":"box","text":"The process of selection and continuous supervision by Fund management does not guarantee","page_number":370,"box":{"x":116,"y":304,"width":714,"height":12}},{"id":"44d87b04-83f7-4c1f-866d-4bbba64507bb","block_type":"box","text":"successful investment results. Careful initial selection is particularly important in this area as many new","page_number":370,"box":{"x":116,"y":320,"width":770,"height":12}},{"id":"2989f6aa-a3d4-4dba-af90-8ee41128dbf0","block_type":"box","text":"enterprises have promise but lack certain of the fundamental factors necessary to prosper. Investing in","page_number":370,"box":{"x":116,"y":335,"width":767,"height":12}},{"id":"df215e3d-fb40-47c1-a3e3-a7c57a746218","block_type":"box","text":"small cap and emerging growth companies requires specialized research and analysis.","page_number":370,"box":{"x":116,"y":351,"width":651,"height":12}},{"id":"aba13849-7abe-412a-9c1e-78f1cfa66b87","block_type":"box","text":"Fund management believes that relatively small companies may have the opportunity to develop into","page_number":370,"box":{"x":117,"y":382,"width":753,"height":12}},{"id":"1b29d692-9152-43ae-ae26-0751d95924a3","block_type":"box","text":"significant business enterprises. A Fund may invest in securities of small issuers in the relatively early","page_number":370,"box":{"x":116,"y":397,"width":759,"height":12}},{"id":"ac0a5f04-714c-4da6-846d-3a976d73cbfa","block_type":"box","text":"stages of business development that have a new technology, a unique or proprietary product or","page_number":370,"box":{"x":116,"y":413,"width":714,"height":12}},{"id":"401793a3-84bf-4628-9f64-691eee87fde2","block_type":"box","text":"service, or a favorable market position.","page_number":370,"box":{"x":116,"y":428,"width":294,"height":12}},{"id":"13b7fcc0-1a9d-43e0-b558-8ed7e8dd8c73","block_type":"box","text":"Equity securities of specific small cap issuers may present different opportunities for long-term capital","page_number":370,"box":{"x":117,"y":459,"width":757,"height":12}},{"id":"d529d3cb-c3b1-4f8b-909d-1af392feeedf","block_type":"box","text":"appreciation during varying portions of economic or securities market cycles, as well as during varying","page_number":370,"box":{"x":116,"y":475,"width":763,"height":12}},{"id":"7819c72c-730d-4f8f-afd8-eeb36927b45a","block_type":"box","text":"stages of their business development. The market valuation of small cap issuers tends to fluctuate","page_number":370,"box":{"x":116,"y":490,"width":734,"height":12}},{"id":"06188257-973b-4ad1-b75c-d74c04d0dc94","block_type":"box","text":"during economic or market cycles.","page_number":370,"box":{"x":116,"y":506,"width":260,"height":12}},{"id":"7ecd689d-fd0f-4faf-8af4-d5ed6a8fd5fa","block_type":"box","text":"Tracking Stocks","page_number":370,"box":{"x":118,"y":537,"width":117,"height":12}},{"id":"d155017f-90f2-45bb-a14d-e0c1f72a7325","block_type":"box","text":". A tracking stock is a separate class of common stock whose value is linked to a","page_number":370,"box":{"x":237,"y":537,"width":604,"height":12}},{"id":"bf876f91-18aa-4c26-b833-280faf394dd5","block_type":"box","text":"specific business unit or operating division within a larger company and is designed to “track” the","page_number":370,"box":{"x":116,"y":552,"width":723,"height":12}},{"id":"952e6bcd-cb84-4513-a4f9-c61e647425ba","block_type":"box","text":"performance of such business unit or division. The tracking stock may pay dividends to shareholders","page_number":370,"box":{"x":117,"y":568,"width":751,"height":12}},{"id":"9261c501-7564-4d6b-8d95-e23a2cb309ae","block_type":"box","text":"independent of the parent company. The parent company, rather than the business unit or division,","page_number":370,"box":{"x":117,"y":583,"width":739,"height":12}},{"id":"bf296872-499f-444e-a46d-567f88cf4340","block_type":"box","text":"generally is the issuer of tracking stock. However, holders of the tracking stock may not have the same","page_number":370,"box":{"x":116,"y":599,"width":768,"height":12}},{"id":"8cad6a11-d50e-450f-a175-a054c15a7813","block_type":"box","text":"rights as holders of the company’s common stock.","page_number":370,"box":{"x":117,"y":614,"width":377,"height":12}},{"id":"d24e8c6a-35e8-4814-94d8-acd13e2b5f0c","block_type":"box","text":"Exchange-Traded Notes (“ETNs”).","page_number":370,"box":{"x":116,"y":645,"width":271,"height":12}},{"id":"133a72e8-4a8a-483f-a659-0306e11a96f4","block_type":"box","text":"Certain Funds may invest in ETNs. ETNs are generally notes","page_number":370,"box":{"x":389,"y":645,"width":464,"height":12}},{"id":"c2869735-583f-46cd-bce7-2555ee505d64","block_type":"box","text":"representing debt of the issuer, usually a financial institution. ETNs combine aspects of both bonds and","page_number":370,"box":{"x":117,"y":661,"width":765,"height":12}},{"id":"c0382d6d-d948-4779-b262-bd16d0c866b6","block_type":"box","text":"ETFs. An ETN’s returns are based on the performance of one or more underlying assets, reference","page_number":370,"box":{"x":117,"y":676,"width":737,"height":12}},{"id":"f57d18d3-8e3d-48fb-8ec0-01992caaef56","block_type":"box","text":"rates or indexes, minus fees and expenses. Similar to ETFs, ETNs are listed on an exchange and","page_number":370,"box":{"x":117,"y":692,"width":724,"height":12}},{"id":"095720cd-cf51-440a-b532-026fe5f2bd2b","block_type":"box","text":"traded in the secondary market. However, unlike an ETF, an ETN can be held until the ETN’s maturity,","page_number":370,"box":{"x":116,"y":707,"width":761,"height":12}},{"id":"93150e5f-45ef-4b75-9c8a-eb387d868127","block_type":"box","text":"at which time the issuer will pay a return linked to the performance of the specific asset, index or rate","page_number":370,"box":{"x":116,"y":723,"width":748,"height":12}},{"id":"c4c7847b-154f-4e3a-bed2-4e38cd217968","block_type":"box","text":"(“reference instrument”) to which the ETN is linked minus certain fees. Unlike regular bonds, ETNs do","page_number":370,"box":{"x":117,"y":738,"width":753,"height":12}},{"id":"135c7706-6608-475b-9127-b783590a1934","block_type":"box","text":"not make periodic interest payments, and principal is not protected.","page_number":370,"box":{"x":117,"y":754,"width":497,"height":12}},{"id":"4dcb92dc-5c29-4cb8-a317-85695b2b9107","block_type":"box","text":"The value of an ETN may be influenced by, among other things, time to maturity, level of supply and","page_number":370,"box":{"x":116,"y":785,"width":743,"height":12}},{"id":"3190c00e-6924-4dab-a371-022ffba64508","block_type":"box","text":"demand for the ETN, volatility and lack of liquidity in underlying markets, changes in the applicable","page_number":370,"box":{"x":116,"y":800,"width":731,"height":12}},{"id":"e82f90ba-2e22-46ab-b57f-4b5fc1a85af7","block_type":"box","text":"interest rates, the performance of the reference instrument, changes in the issuer’s credit rating and","page_number":370,"box":{"x":117,"y":816,"width":739,"height":12}},{"id":"2a2132fc-e1ac-45b8-8c8c-82e648fd4125","block_type":"box","text":"economic, legal, political or geographic events that affect the reference instrument. ETNs are subject to","page_number":370,"box":{"x":116,"y":831,"width":772,"height":12}},{"id":"326004bd-5109-47a2-a942-8970ff774ed6","block_type":"box","text":"credit risk and the value of the ETN may drop due to a downgrade in an issuer’s credit rating, despite","page_number":370,"box":{"x":116,"y":847,"width":755,"height":12}},{"id":"0f2f5c39-ac3e-40fb-a9cc-c5298de0fc15","block_type":"box","text":"the underlying reference instrument remaining unchanged. When a Fund invests in ETNs, it will bear","page_number":370,"box":{"x":116,"y":862,"width":752,"height":12}},{"id":"e8b79e75-dd2c-418c-b587-7eefb92a31a1","block_type":"box","text":"its proportionate share of any fees and expenses borne by the ETN.","page_number":370,"box":{"x":117,"y":878,"width":509,"height":12}},{"id":"b6eafceb-5076-47de-aa89-8d7db916c51b","block_type":"box","text":"II-38","page_number":370,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"6bf0e202-197d-4a00-932b-00c1d6d0b73f","block_type":"box","text":"NM1026U-6004382-370/605","page_number":370,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"15487e06-82a3-46ba-a916-f143e79bc3ce","block_type":"box","text":"An ETN that is tied to a reference instrument may not replicate the performance of the reference","page_number":371,"box":{"x":116,"y":87,"width":720,"height":12}},{"id":"957bed06-e545-4fc5-95f7-b896c3267bd7","block_type":"box","text":"instrument. ETNs also incur certain expenses not incurred by their applicable reference instrument.","page_number":371,"box":{"x":117,"y":102,"width":740,"height":13}},{"id":"d3365251-5f06-4412-baa9-f8cc185a3e0f","block_type":"box","text":"Some ETNs that use leverage may, at times, be illiquid and","page_number":371,"box":{"x":116,"y":118,"width":446,"height":12}},{"id":"4ba77775-7320-49f8-a320-3d67f2baf5d1","block_type":"box","text":"may be difficult to purchase or sell at a fair","page_number":371,"box":{"x":563,"y":118,"width":319,"height":12}},{"id":"2e238175-a6b6-49c9-ab43-4bf180076b13","block_type":"box","text":"price. Levered ETNs are subject to the same risk as other instruments that use leverage in any form.","page_number":371,"box":{"x":117,"y":134,"width":751,"height":12}},{"id":"abef15ab-c3be-418a-bcc5-7971505bfa76","block_type":"box","text":"While leverage allows for greater potential return, the potential for loss is also greater. Finally,","page_number":371,"box":{"x":116,"y":149,"width":700,"height":12}},{"id":"61d70d4e-a7ed-4f08-9e94-b42b9331f069","block_type":"box","text":"additional losses may be incurred if the investment loses value because, in addition to the money lost","page_number":371,"box":{"x":116,"y":165,"width":757,"height":12}},{"id":"ef8a8988-44e7-4962-98c8-dd8bc377bcae","block_type":"box","text":"on the investment, the loan still needs to be repaid.","page_number":371,"box":{"x":116,"y":180,"width":384,"height":12}},{"id":"595f2c04-b15b-4e62-aa5c-320ae3fc46eb","block_type":"box","text":"Because the return on the ETN is dependent on the issuer’s ability or willingness to meet its","page_number":371,"box":{"x":117,"y":210,"width":685,"height":12}},{"id":"19ac790d-24bf-4af1-97db-2f6c4002e631","block_type":"box","text":"obligations, the value of the ETN may change due to a change in the issuer’s credit rating, despite no","page_number":371,"box":{"x":116,"y":226,"width":757,"height":12}},{"id":"23d5bd9d-557f-4e40-9908-0b3f2fa46feb","block_type":"box","text":"change in the underlying reference instrument. The market value of ETN shares may differ from the","page_number":371,"box":{"x":116,"y":241,"width":744,"height":12}},{"id":"5223248f-695a-40fd-bb5a-4bb61f35ac07","block_type":"box","text":"value of the reference instrument. This difference in price may be due to the fact that the supply and","page_number":371,"box":{"x":116,"y":257,"width":748,"height":12}},{"id":"61f88b54-f15d-407b-9ca0-04510629ee6f","block_type":"box","text":"demand in the market for ETN shares at any point in time is not always identical to the supply and","page_number":371,"box":{"x":116,"y":272,"width":732,"height":12}},{"id":"357192aa-e34b-4f0b-a4c9-77ec387607ea","block_type":"box","text":"demand in the market for the assets underlying the reference instrument that the ETN seeks to track.","page_number":371,"box":{"x":116,"y":288,"width":755,"height":12}},{"id":"a77488b1-9c82-4cfd-8340-82bc3e80b6ef","block_type":"box","text":"There may be restrictions on the Fund’s right to redeem its investment in an ETN, which are generally","page_number":371,"box":{"x":116,"y":318,"width":761,"height":12}},{"id":"3e57e66c-b4fb-4b76-a9e4-286880458e89","block_type":"box","text":"meant to be held until maturity. The Fund’s decision to sell its ETN holdings may be limited by the","page_number":371,"box":{"x":117,"y":333,"width":728,"height":12}},{"id":"c3c5513a-c7d3-45fe-ade9-0ef9ca88c7a2","block_type":"box","text":"availability of a secondary market. An investor in an ETN could lose some or all of the amount","page_number":371,"box":{"x":116,"y":349,"width":701,"height":12}},{"id":"965b2d6d-026e-41a7-9407-d9c9361bd976","block_type":"box","text":"invested.","page_number":371,"box":{"x":117,"y":364,"width":71,"height":10}},{"id":"4c592f38-4499-4d35-910c-dba79fcf38c0","block_type":"box","text":"ETNs are also subject to tax risks. The Internal Revenue Service (the “IRS”) may not accept, and a","page_number":371,"box":{"x":117,"y":394,"width":739,"height":12}},{"id":"49d78a8a-d9ff-4ea2-92ff-335369442426","block_type":"box","text":"court may not uphold, how the Funds characterize and treat ETNs for tax purposes. The timing and","page_number":371,"box":{"x":116,"y":410,"width":742,"height":12}},{"id":"78afaec4-d68f-48b7-b9f4-9ad49730023f","block_type":"box","text":"character of income and gains derived by a Fund from investments in ETNs may be affected by future","page_number":371,"box":{"x":116,"y":425,"width":762,"height":12}},{"id":"5139500e-a7f8-4102-8cbb-07991bfda7cc","block_type":"box","text":"legislation.","page_number":371,"box":{"x":117,"y":441,"width":83,"height":12}},{"id":"8d1f86df-3edb-405a-b6da-f0470a007827","block_type":"box","text":"Foreign Investments.","page_number":371,"box":{"x":116,"y":471,"width":174,"height":12}},{"id":"af414818-ed77-48a7-bb1e-fbed5f784a2b","block_type":"box","text":"Foreign Investment Risks.","page_number":371,"box":{"x":116,"y":494,"width":193,"height":12}},{"id":"e5f6c57e-5c08-4006-aa99-6eb124fc8f40","block_type":"box","text":"Certain Funds may invest in foreign securities, including securities from","page_number":371,"box":{"x":310,"y":493,"width":540,"height":13}},{"id":"7f7c90bc-f642-483a-9ed3-501c3158e804","block_type":"box","text":"issuers located in emerging market countries. These securities may be denominated in U.S. dollars or","page_number":371,"box":{"x":117,"y":509,"width":760,"height":12}},{"id":"3a8d2664-e3b4-432e-96ac-6cb1adb7c316","block_type":"box","text":"in a foreign currency. Investing in foreign securities involves risks not typically associated with investing","page_number":371,"box":{"x":117,"y":524,"width":770,"height":13}},{"id":"4d7529c9-cc57-43bf-8492-6ec9fd5f33e8","block_type":"box","text":"in securities of companies organized and operated in the United States that can increase the chances","page_number":371,"box":{"x":117,"y":540,"width":759,"height":12}},{"id":"2d431f29-6eb0-4442-9dbd-d9eb36b0bf07","block_type":"box","text":"that a Fund will lose money.","page_number":371,"box":{"x":116,"y":556,"width":213,"height":12}},{"id":"7648a726-381a-4ef4-91fd-aef3abddc96b","block_type":"box","text":"Securities issued by certain companies organized outside the United States may not be deemed to be","page_number":371,"box":{"x":116,"y":586,"width":762,"height":12}},{"id":"576d1837-ec51-47ce-b595-34f3cf22b002","block_type":"box","text":"foreign securities (but rather deemed to be U.S. securities) if (i) the company’s principal operations are","page_number":371,"box":{"x":116,"y":601,"width":766,"height":12}},{"id":"d2ad8397-4808-41bf-b3e7-a4f9f7b3cb87","block_type":"box","text":"conducted from the U.S., (ii) the company’s equity securities trade principally on a U.S. stock","page_number":371,"box":{"x":116,"y":617,"width":694,"height":12}},{"id":"eb294807-7bba-477f-b506-662c6ca1c492","block_type":"box","text":"exchange, (iii) the company does a substantial amount of business in the U.S. or (iv) the issuer of","page_number":371,"box":{"x":116,"y":632,"width":729,"height":12}},{"id":"cd9044c1-e8e6-4e53-bf35-6210bd2bd882","block_type":"box","text":"securities is included in the Fund’s primary U.S. benchmark index.","page_number":371,"box":{"x":116,"y":648,"width":496,"height":12}},{"id":"af2dddcd-bb2d-4aa5-8e7b-62e47225d6f7","block_type":"box","text":"In addition to equity securities, foreign investments of the Funds may include: (a) debt obligations","page_number":371,"box":{"x":117,"y":678,"width":721,"height":12}},{"id":"f73ed4aa-6ef2-4922-bc9b-2b5a2e3b8164","block_type":"box","text":"issued or guaranteed by foreign sovereign governments or their agencies, authorities, instrumentalities","page_number":371,"box":{"x":117,"y":693,"width":762,"height":12}},{"id":"44868833-eb1c-4be0-9600-4d824adb362c","block_type":"box","text":"or political subdivisions, including a foreign state, province or municipality; (b) debt obligations of","page_number":371,"box":{"x":116,"y":709,"width":716,"height":12}},{"id":"60731d5e-f45b-45d0-8814-d066225bdc5d","block_type":"box","text":"supranational organizations; (c) debt obligations of foreign banks and bank holding companies;","page_number":371,"box":{"x":116,"y":724,"width":703,"height":12}},{"id":"64cc570b-33b7-486a-8b5f-2d7782bd0e51","block_type":"box","text":"(d) debt obligations of domestic banks and corporations issued in foreign currencies; (e) debt","page_number":371,"box":{"x":117,"y":740,"width":689,"height":12}},{"id":"2e214f0a-4e99-47ca-9429-243b22e240f3","block_type":"box","text":"obligations denominated in the Euro; and (f) foreign corporate debt securities and commercial paper.","page_number":371,"box":{"x":116,"y":755,"width":746,"height":12}},{"id":"030feaa5-8e7b-4d97-84bb-4f5cb98fc582","block_type":"box","text":"Such securities may include loan participations and assignments, convertible securities and","page_number":371,"box":{"x":116,"y":771,"width":678,"height":12}},{"id":"c1ebfee1-1a8f-4961-9598-054f3d0d6549","block_type":"box","text":"zero-coupon securities.","page_number":371,"box":{"x":116,"y":786,"width":172,"height":12}},{"id":"e98bf642-4599-43db-abb4-598511f9b3e6","block_type":"box","text":"Dividends or interest on, or proceeds from the sale of, foreign securities may be subject to foreign","page_number":371,"box":{"x":117,"y":816,"width":723,"height":12}},{"id":"52f54441-788f-4d4e-9e64-ac2d9e419131","block_type":"box","text":"withholding taxes.","page_number":371,"box":{"x":116,"y":832,"width":138,"height":12}},{"id":"c703c097-8b4e-4c5b-a657-ab6b9c454e5e","block_type":"box","text":"To the extent that the underlying securities or other instruments held by a Fund trade on foreign","page_number":371,"box":{"x":116,"y":862,"width":715,"height":12}},{"id":"591adc75-cba2-4a63-a3a1-448075fb6825","block_type":"box","text":"exchanges or in foreign markets that are closed when the securities exchange on which the Fund’s","page_number":371,"box":{"x":116,"y":877,"width":740,"height":12}},{"id":"99fc8fa5-8564-43c9-a99e-c566f57bdc1b","block_type":"box","text":"II-39","page_number":371,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"0a09e185-3f43-482f-befb-64467de4b3ca","block_type":"box","text":"NM1026U-6004382-371/605","page_number":371,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"fd21fc7c-1fef-4b2e-a69a-3f7072fe8a15","block_type":"box","text":"shares trade is open, there are likely to be deviations between the current price of such an underlying","page_number":372,"box":{"x":116,"y":87,"width":758,"height":12}},{"id":"27771de8-7950-40b5-a1ce-cb23a4fca155","block_type":"box","text":"security and the last quoted price for the underlying security (i.e., the Fund’s quote from the closed","page_number":372,"box":{"x":116,"y":102,"width":736,"height":13}},{"id":"ec1e6599-effa-4d66-8d67-1b87a5b7e5a2","block_type":"box","text":"foreign market). The impact of a closed foreign market on a Fund is likely to be greater where a large","page_number":372,"box":{"x":116,"y":118,"width":755,"height":12}},{"id":"97850a5b-f0a0-429d-ab2c-b8a106995230","block_type":"box","text":"portion of the Fund’s underlying securities or other instruments trade on that closed foreign market or","page_number":372,"box":{"x":117,"y":134,"width":754,"height":12}},{"id":"810733ec-7a37-4a5a-b1dc-cc7050e86b67","block_type":"box","text":"when the foreign market is closed for unscheduled reasons. These deviations may result in premiums","page_number":372,"box":{"x":116,"y":149,"width":759,"height":12}},{"id":"c70351be-c60f-43be-86ed-765d315fcee7","block_type":"box","text":"or discounts to certain Funds’ NAVs that may be greater than those experienced by other ETFs.","page_number":372,"box":{"x":116,"y":165,"width":718,"height":12}},{"id":"3387a911-fb8b-4115-993a-b9bbaf11b36c","block_type":"box","text":"Foreign Market Risk.","page_number":372,"box":{"x":116,"y":196,"width":152,"height":12}},{"id":"823a002a-2ed7-4a07-b591-f0bed9e44340","block_type":"box","text":"Funds that may invest in foreign securities offer the potential for more","page_number":372,"box":{"x":269,"y":196,"width":521,"height":12}},{"id":"9698abb8-534c-4851-a8f0-5799cd7ee655","block_type":"box","text":"diversification than a Fund that invests only in the United States because securities traded on foreign","page_number":372,"box":{"x":116,"y":211,"width":746,"height":12}},{"id":"ccc1a315-5635-46c2-acb1-06ea73848e18","block_type":"box","text":"markets have often (though not always) performed differently from securities traded in the United","page_number":372,"box":{"x":117,"y":227,"width":715,"height":12}},{"id":"b19a58fa-726a-4121-b852-b1ad099b2feb","block_type":"box","text":"States. However, such investments often involve risks not present in U.S. investments that can increase","page_number":372,"box":{"x":116,"y":242,"width":769,"height":12}},{"id":"5dc74558-bdff-4c4c-9d6f-74c3a1b26de2","block_type":"box","text":"the chances that a Fund will lose money. In particular, a Fund is subject to the risk that, because there","page_number":372,"box":{"x":116,"y":258,"width":756,"height":12}},{"id":"128034c7-a0b2-4d6e-891e-ebc4d73482ea","block_type":"box","text":"are generally fewer investors on foreign exchanges and a smaller number of shares traded each day, it","page_number":372,"box":{"x":116,"y":273,"width":762,"height":12}},{"id":"593d4863-4fbb-4160-ab8c-0aa7831e19ae","block_type":"box","text":"may be difficult for the Fund to buy and sell securities on those exchanges. In addition, prices of foreign","page_number":372,"box":{"x":117,"y":289,"width":763,"height":12}},{"id":"189fa3ca-49f0-4030-9ccd-68366d3ea04e","block_type":"box","text":"securities may fluctuate more than prices of securities traded in the United States. Investments in","page_number":372,"box":{"x":116,"y":304,"width":719,"height":12}},{"id":"9a3034de-d774-4db2-a1da-f9e72ddf3ccb","block_type":"box","text":"foreign markets may also be adversely affected by governmental actions such as the imposition of","page_number":372,"box":{"x":116,"y":320,"width":727,"height":12}},{"id":"c959b4ad-2ba0-4536-9cb7-0de2f4e0df7c","block_type":"box","text":"punitive taxes or tariffs. In addition, economic conditions, such as volatile currency exchange rates and","page_number":372,"box":{"x":117,"y":335,"width":759,"height":12}},{"id":"ef506ff8-970d-411a-8f47-27abac27ec52","block_type":"box","text":"interest rates, political events, military action and other conditions may, without prior warning, lead to the","page_number":372,"box":{"x":117,"y":351,"width":770,"height":12}},{"id":"68169d1c-1e0e-48d1-9425-be3273e23bac","block_type":"box","text":"governments of certain countries, or the U.S. Government with respect to certain countries, prohibiting","page_number":372,"box":{"x":116,"y":366,"width":756,"height":12}},{"id":"5dbf1b90-129b-46ee-bce8-ef6de4c6c43d","block_type":"box","text":"or imposing substantial restrictions through capital controls and/or sanctions on foreign investing in the","page_number":372,"box":{"x":116,"y":382,"width":758,"height":12}},{"id":"569ed244-455a-4339-989a-df44bde92b0f","block_type":"box","text":"capital markets or certain industries in those countries. Capital controls and/or sanctions may include","page_number":372,"box":{"x":116,"y":397,"width":746,"height":12}},{"id":"43c28569-2f45-4433-a882-6568e2e4bc9d","block_type":"box","text":"the prohibition of, or restrictions on, the ability to own or transfer currency, securities, derivatives or","page_number":372,"box":{"x":116,"y":413,"width":730,"height":12}},{"id":"83ea92e5-fc14-472f-8e22-f80044068c5a","block_type":"box","text":"other assets and may also include retaliatory actions of one government against another government,","page_number":372,"box":{"x":116,"y":428,"width":752,"height":12}},{"id":"bc6bd668-a0ec-4eb1-b023-08345b5ceceb","block_type":"box","text":"such as seizure of assets. Any of these actions could severely impair a Fund’s ability to purchase, sell,","page_number":372,"box":{"x":116,"y":444,"width":758,"height":12}},{"id":"7403b955-76f4-4ed0-9ff1-249bd33b8b93","block_type":"box","text":"transfer, receive, deliver or otherwise obtain exposure to foreign securities and assets, including the","page_number":372,"box":{"x":116,"y":459,"width":738,"height":12}},{"id":"e250b4ce-a77c-4076-90fb-60ef434deb8c","block_type":"box","text":"ability to transfer the Fund’s assets or income back into the United States, and could negatively impact","page_number":372,"box":{"x":116,"y":475,"width":758,"height":12}},{"id":"5a1e7fa6-4684-497e-bd8a-c5bfc157f205","block_type":"box","text":"the value and/or liquidity of such assets or otherwise adversely affect a Fund’s operations, causing the","page_number":372,"box":{"x":116,"y":490,"width":757,"height":12}},{"id":"8e5bf9b0-3089-419e-b05b-efddd65fe831","block_type":"box","text":"Fund to decline in value. Other potential foreign market risks include exchange controls, difficulties in","page_number":372,"box":{"x":117,"y":506,"width":745,"height":12}},{"id":"bfd4cd56-a37f-4901-a036-a0745ff4ff1a","block_type":"box","text":"pricing securities, defaults on foreign government securities, difficulties in enforcing favorable legal","page_number":372,"box":{"x":117,"y":521,"width":727,"height":12}},{"id":"3c26d3fe-fa66-4899-aa16-aa009a28cc7d","block_type":"box","text":"judgments in foreign courts, and political and social conditions, such as diplomatic relations,","page_number":372,"box":{"x":115,"y":537,"width":680,"height":12}},{"id":"c588e08b-712e-46df-a01c-4d8807d0591a","block_type":"box","text":"confiscatory taxation, expropriation, limitation on the removal of funds or assets, or imposition of (or","page_number":372,"box":{"x":116,"y":552,"width":735,"height":12}},{"id":"b68a4feb-5c89-453a-9f1a-1780dbab3a80","block_type":"box","text":"change in) exchange control regulations. Legal remedies available to investors in certain foreign","page_number":372,"box":{"x":116,"y":568,"width":711,"height":12}},{"id":"75940550-8bf4-4fbd-bb74-866d42a3227c","block_type":"box","text":"countries may be less extensive than those available to investors in the United States or other foreign","page_number":372,"box":{"x":116,"y":583,"width":751,"height":12}},{"id":"ebbb7d34-fe18-45d7-a92e-3143b5bbfe2e","block_type":"box","text":"countries. In addition, changes in government administrations or economic or monetary policies in the","page_number":372,"box":{"x":116,"y":599,"width":752,"height":12}},{"id":"f8bc7a20-ef48-4dce-86bb-a94d717b165f","block_type":"box","text":"United States or abroad could result in appreciation or depreciation of portfolio securities and could","page_number":372,"box":{"x":117,"y":614,"width":731,"height":12}},{"id":"60c2397b-d92f-47f0-a6b4-845fbed586f1","block_type":"box","text":"favorably or adversely affect a Fund’s operations.","page_number":372,"box":{"x":116,"y":630,"width":368,"height":12}},{"id":"a9a19ebb-590b-42b4-8069-c3d01ea5bf52","block_type":"box","text":"Foreign Economy Risk.","page_number":372,"box":{"x":116,"y":661,"width":172,"height":12}},{"id":"0ddd8fac-effc-4e03-9865-c3f58f6dd9a7","block_type":"box","text":"The economies of certain foreign markets often do not compare favorably with","page_number":372,"box":{"x":295,"y":661,"width":579,"height":12}},{"id":"b9638d08-7a5a-4032-95a2-c49ff7582a7d","block_type":"box","text":"that of the United States with respect to such issues as growth of gross national product, reinvestment","page_number":372,"box":{"x":116,"y":676,"width":759,"height":12}},{"id":"7949ad55-10bd-40c0-91e8-ccd95a901cb7","block_type":"box","text":"of capital, resources, and balance of payments position. Certain such economies may rely heavily on","page_number":372,"box":{"x":116,"y":692,"width":748,"height":12}},{"id":"7b9c9454-fbc8-4afb-8c85-3ebdf1528e0f","block_type":"box","text":"particular industries or foreign capital and are more vulnerable to diplomatic developments, the","page_number":372,"box":{"x":117,"y":707,"width":702,"height":12}},{"id":"394468be-0a99-4b05-a621-46fafffc7384","block_type":"box","text":"imposition of economic sanctions against a particular country or countries, changes in international","page_number":372,"box":{"x":117,"y":723,"width":731,"height":12}},{"id":"32b86716-ff9f-462c-9405-4fed6277564a","block_type":"box","text":"trading patterns, trade barriers, and other protectionist or retaliatory measures.","page_number":372,"box":{"x":116,"y":738,"width":582,"height":12}},{"id":"c5e24e87-0ba3-48cd-bdec-7b6d9b839e04","block_type":"box","text":"Currency Risk and Exchange Risk.","page_number":372,"box":{"x":117,"y":769,"width":257,"height":12}},{"id":"759eec58-d229-4426-8e8e-95e15ca5179d","block_type":"box","text":"Because foreign securities generally are denominated and pay","page_number":372,"box":{"x":382,"y":769,"width":464,"height":12}},{"id":"6e7bdd33-3fba-4b7c-95c4-e6fe84023e9e","block_type":"box","text":"dividends or interest in foreign currencies, the value of a Fund that invests in foreign securities as","page_number":372,"box":{"x":116,"y":785,"width":721,"height":12}},{"id":"3309365a-ffd2-4235-82a4-720d8515d6a4","block_type":"box","text":"measured in U.S. dollars will be affected favorably or unfavorably by changes in exchange rates.","page_number":372,"box":{"x":117,"y":800,"width":715,"height":12}},{"id":"9c0333c8-4cb3-4487-8f7e-415e188f1d25","block_type":"box","text":"Generally, when the U.S. dollar rises in value against a foreign currency, a security denominated in","page_number":372,"box":{"x":117,"y":816,"width":733,"height":12}},{"id":"184eaf4f-44aa-48b7-8e88-ddd8bcadef4b","block_type":"box","text":"that currency loses value because the currency is worth fewer U.S. dollars. Conversely, when the U.S.","page_number":372,"box":{"x":116,"y":831,"width":765,"height":12}},{"id":"19b09714-3537-4ff7-901d-f0fdfe72b414","block_type":"box","text":"dollar decreases in value against a foreign currency, a security denominated in that currency gains","page_number":372,"box":{"x":116,"y":847,"width":737,"height":12}},{"id":"6ef0ba43-698a-4aff-adb0-6b17906ad509","block_type":"box","text":"value because the currency is worth more U.S. dollars. This risk, generally known as “currency risk,”","page_number":372,"box":{"x":116,"y":862,"width":749,"height":12}},{"id":"21c447e1-7b0d-4128-8af0-5f67e37af427","block_type":"box","text":"means that a stronger U.S. dollar will reduce returns for U.S. investors while a weak U.S. dollar will","page_number":372,"box":{"x":117,"y":878,"width":738,"height":12}},{"id":"6fdb140b-74e2-4596-9d11-83b706420f86","block_type":"box","text":"II-40","page_number":372,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"72ff7e76-3226-4756-8ff5-a997c2be8351","block_type":"box","text":"NM1026U-6004382-372/605","page_number":372,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5c0cc6e3-d2e5-4f06-94a4-c7dcf452504f","block_type":"box","text":"increase those returns. Currency exchange rates can also be affected unpredictably by intervention by","page_number":373,"box":{"x":117,"y":87,"width":764,"height":12}},{"id":"87176b54-8f4b-4538-8677-e332217de96e","block_type":"box","text":"U.S. or foreign governments or central banks, or the failure to intervene, or buy currency controls or","page_number":373,"box":{"x":117,"y":102,"width":743,"height":13}},{"id":"f183b4c1-2a10-4d4a-b476-0870b05b0f2a","block_type":"box","text":"political developments in the United States or abroad.","page_number":373,"box":{"x":117,"y":118,"width":402,"height":12}},{"id":"a070a03f-b761-4844-8518-fe2c9728cfec","block_type":"box","text":"Governmental Supervision and Regulation/Accounting Standards. Many foreign governments","page_number":373,"box":{"x":117,"y":149,"width":697,"height":12}},{"id":"0576013e-9dc1-4efb-8e21-d471037bfe47","block_type":"box","text":"supervise and regulate stock exchanges, brokers and the sale of securities less than does the United","page_number":373,"box":{"x":116,"y":165,"width":756,"height":12}},{"id":"196fb5b8-6b85-42b9-a688-4202e1135129","block_type":"box","text":"States. Some countries may not have laws to protect investors comparable to the U.S. securities laws.","page_number":373,"box":{"x":116,"y":180,"width":765,"height":12}},{"id":"eb86168f-c0d6-4533-bc9e-709e9b9b08f4","block_type":"box","text":"For example, some foreign countries may have no laws or rules against insider trading. Insider trading","page_number":373,"box":{"x":117,"y":196,"width":762,"height":12}},{"id":"549672be-fc1b-4edb-9bfb-eb58b82ca8be","block_type":"box","text":"occurs when a person buys or sells a company’s securities based on nonpublic information about that","page_number":373,"box":{"x":116,"y":211,"width":760,"height":12}},{"id":"93bfcd30-c999-4f3d-a9d0-0cf3cfd99de8","block_type":"box","text":"company. Accounting standards in other countries are not necessarily the same as in the United","page_number":373,"box":{"x":116,"y":227,"width":719,"height":12}},{"id":"f0ad35e4-933a-45db-bf55-c3af93601f20","block_type":"box","text":"States. If the accounting standards in another country do not require as much detail as U.S. accounting","page_number":373,"box":{"x":116,"y":242,"width":771,"height":12}},{"id":"7473e1e7-5a95-4b9a-a4f3-158b8e611540","block_type":"box","text":"standards, it may be harder for Fund management to completely and accurately determine a","page_number":373,"box":{"x":116,"y":258,"width":691,"height":12}},{"id":"900fcf02-a276-42db-9b72-8ffd8c7b2b22","block_type":"box","text":"company’s financial condition. In addition, the U.S. Government has from time to time in the past","page_number":373,"box":{"x":116,"y":273,"width":722,"height":12}},{"id":"9a9a8077-45ca-460b-b2d2-5bf84093d1ca","block_type":"box","text":"imposed restrictions, through penalties and otherwise, on foreign investments by U.S. investors such","page_number":373,"box":{"x":117,"y":289,"width":752,"height":12}},{"id":"038870ba-1155-41f0-9d6f-83e8973c95ad","block_type":"box","text":"as the Fund. If such restrictions should be reinstituted, it might become necessary for the Fund to","page_number":373,"box":{"x":116,"y":304,"width":727,"height":12}},{"id":"d880656a-a25e-4cfe-959d-eecd9dde3c14","block_type":"box","text":"invest all or substantially all of its assets in U.S. securities. Also, brokerage commissions and other","page_number":373,"box":{"x":117,"y":320,"width":737,"height":12}},{"id":"68072478-7644-44ee-b7d4-d673f12ee239","block_type":"box","text":"costs of buying or selling securities often are higher in foreign countries than they are in the United","page_number":373,"box":{"x":116,"y":335,"width":736,"height":12}},{"id":"a160cfb3-b456-4272-8aba-62e76f453184","block_type":"box","text":"States. This reduces the amount the Fund can earn on its investments.","page_number":373,"box":{"x":116,"y":351,"width":532,"height":9}},{"id":"6b1923c3-b643-4d2a-80da-f7f55695fa69","block_type":"box","text":"Certain Risks of Holding Fund Assets Outside the United States.","page_number":373,"box":{"x":117,"y":382,"width":477,"height":12}},{"id":"4177ba93-3d07-4977-a5c7-a3e4eba1dbd0","block_type":"box","text":"A Fund generally holds its foreign","page_number":373,"box":{"x":596,"y":382,"width":259,"height":12}},{"id":"d823ab4c-1748-4d61-ac62-cbc36a24fb02","block_type":"box","text":"securities and cash in foreign banks and securities depositories. Some foreign banks and securities","page_number":373,"box":{"x":116,"y":397,"width":743,"height":12}},{"id":"64a48684-1a37-41a4-90e5-468f84721a50","block_type":"box","text":"depositories may be recently organized or new to the foreign custody business. In addition, there may","page_number":373,"box":{"x":116,"y":413,"width":760,"height":12}},{"id":"2f5f5d36-7579-4302-9e66-f57fa23ba53e","block_type":"box","text":"be limited or no regulatory oversight over their operations. Also, the laws of certain countries may put","page_number":373,"box":{"x":117,"y":428,"width":754,"height":12}},{"id":"f100254e-5315-4409-8c75-a240d7d91d10","block_type":"box","text":"limits on a Fund’s ability to recover its assets if a foreign bank or depository or issuer of a security or","page_number":373,"box":{"x":117,"y":444,"width":747,"height":12}},{"id":"4d7db29d-d58b-47fe-8773-be20b4ba9a97","block_type":"box","text":"any of their agents goes bankrupt. In addition, it is often more expensive for a Fund to buy, sell and","page_number":373,"box":{"x":116,"y":459,"width":741,"height":12}},{"id":"414c49fe-e615-44b7-ac65-fa1938e75463","block_type":"box","text":"hold securities in certain foreign markets than in the United States. The increased expense of investing","page_number":373,"box":{"x":117,"y":475,"width":768,"height":12}},{"id":"ba810654-833c-4395-9505-59f040f2010e","block_type":"box","text":"in foreign markets reduces the amount a Fund can earn on its investments and typically results in a","page_number":373,"box":{"x":117,"y":490,"width":741,"height":12}},{"id":"8eceebfe-6e5b-48dd-8ea7-b0de2a9e9280","block_type":"box","text":"higher operating expense ratio for the Fund as compared to investment companies that invest only in","page_number":373,"box":{"x":117,"y":506,"width":754,"height":12}},{"id":"8153646e-4f07-4b29-a4dc-125dbcd898ef","block_type":"box","text":"the United States.","page_number":373,"box":{"x":116,"y":521,"width":138,"height":10}},{"id":"71e31b42-effd-47f7-8b8b-eff28ba8689e","block_type":"box","text":"Publicly Available Information.","page_number":373,"box":{"x":116,"y":552,"width":222,"height":12}},{"id":"27e19730-9d2e-482e-9e4c-04b08c37a35e","block_type":"box","text":"In general, less information is publicly available with respect to foreign","page_number":373,"box":{"x":340,"y":552,"width":529,"height":12}},{"id":"7aa1b9f3-19d0-432b-8171-04e15232741b","block_type":"box","text":"issuers than is available with respect to U.S. companies. Most foreign companies are also not subject","page_number":373,"box":{"x":117,"y":568,"width":758,"height":12}},{"id":"cdc13e89-2ef2-4f0e-b38b-1ddc7ed067a3","block_type":"box","text":"to the uniform accounting and financial reporting requirements applicable to issuers in the United","page_number":373,"box":{"x":116,"y":583,"width":723,"height":12}},{"id":"da3c844a-af61-4e3d-b08b-dc6446cdac62","block_type":"box","text":"States. While the volume of transactions effected on foreign stock exchanges has increased in recent","page_number":373,"box":{"x":116,"y":599,"width":758,"height":12}},{"id":"da52dc70-128a-42dd-8741-d7130061ec1f","block_type":"box","text":"years, it remains appreciably below that of the New York Stock Exchange. Accordingly, a Fund’s","page_number":373,"box":{"x":116,"y":614,"width":721,"height":12}},{"id":"412d5665-36bd-4089-b049-639ee18d6977","block_type":"box","text":"foreign investments may be less liquid than, and their prices may be more volatile than, comparable","page_number":373,"box":{"x":116,"y":630,"width":745,"height":12}},{"id":"044ad62b-0d39-4c4b-98ba-4e42219b1af6","block_type":"box","text":"investments in securities in U.S. companies. In addition, there is generally less government supervision","page_number":373,"box":{"x":117,"y":645,"width":771,"height":12}},{"id":"556704e8-c156-475b-81bc-6918ff7dc3d4","block_type":"box","text":"and regulation of securities exchanges, brokers and issuers in foreign countries than in the United","page_number":373,"box":{"x":116,"y":661,"width":726,"height":12}},{"id":"92d36518-3f5f-45d0-a128-3ed78c18a33f","block_type":"box","text":"States.","page_number":373,"box":{"x":116,"y":676,"width":51,"height":10}},{"id":"a8244776-a8a8-4f0f-be4d-4e374ba4c285","block_type":"box","text":"Settlement Risk.","page_number":373,"box":{"x":117,"y":707,"width":120,"height":10}},{"id":"2f9e74e3-aa8e-49da-b65c-c106cd5d7678","block_type":"box","text":"Settlement and clearance procedures in certain foreign markets differ significantly","page_number":373,"box":{"x":244,"y":707,"width":606,"height":12}},{"id":"e1a61040-bdf6-4380-a5b4-3408ea020969","block_type":"box","text":"from those in the United States. Supervisory authorities may also be unable to apply standards which","page_number":373,"box":{"x":116,"y":723,"width":751,"height":12}},{"id":"c562661f-3215-4918-9f00-ef06abfeceeb","block_type":"box","text":"are comparable with those in the United States. Foreign settlement procedures and trade regulations","page_number":373,"box":{"x":116,"y":738,"width":749,"height":12}},{"id":"516d3192-11f6-4bbe-acf7-2940a132ea0a","block_type":"box","text":"also may involve certain risks (such as delays in payment for or delivery of securities) not typically","page_number":373,"box":{"x":116,"y":754,"width":727,"height":12}},{"id":"fd0d3f51-02ee-46fd-9b27-44ff88787c0e","block_type":"box","text":"generated by the settlement of U.S. investments.","page_number":373,"box":{"x":116,"y":769,"width":362,"height":12}},{"id":"fd5cdb7c-4561-4a55-87be-37955721a4af","block_type":"box","text":"Communications between the United States and emerging market countries may be unreliable,","page_number":373,"box":{"x":117,"y":800,"width":704,"height":12}},{"id":"7930bcb0-ab53-4926-9dd3-9c897a8b45ea","block_type":"box","text":"increasing the risk of delayed settlements or losses of security certificates in markets that still rely on","page_number":373,"box":{"x":117,"y":816,"width":744,"height":12}},{"id":"c941f567-d5dd-4975-a6bc-cb79cdb823ad","block_type":"box","text":"physical settlement. Settlements in certain foreign countries at times have not kept pace with the","page_number":373,"box":{"x":117,"y":831,"width":720,"height":12}},{"id":"d7f7c2d8-eb5f-4d10-997d-480a6de4c92d","block_type":"box","text":"number of securities transactions; these problems may make it difficult for a Fund to carry out","page_number":373,"box":{"x":117,"y":847,"width":698,"height":12}},{"id":"557a19c5-72a0-493b-8ff0-9847656cb501","block_type":"box","text":"transactions. If a Fund cannot settle or is delayed in settling a purchase of securities, it may miss","page_number":373,"box":{"x":116,"y":862,"width":723,"height":12}},{"id":"a8460b00-ef18-4448-b1bc-c22f59d0d5e4","block_type":"box","text":"attractive investment opportunities and certain of its assets may be uninvested with no return earned","page_number":373,"box":{"x":116,"y":878,"width":751,"height":12}},{"id":"aed00880-1f67-4226-99c2-a5cbb32ffb8d","block_type":"box","text":"II-41","page_number":373,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"717f1a7f-3695-44a1-b771-e412d350cd06","block_type":"box","text":"NM1026U-6004382-373/605","page_number":373,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9790d860-df0c-402c-8819-11642f517423","block_type":"box","text":"thereon for some period. If a Fund cannot settle or is delayed in settling a sale of securities, it may lose","page_number":374,"box":{"x":116,"y":87,"width":769,"height":12}},{"id":"eb971479-a00c-40a7-8720-97522b0eeba3","block_type":"box","text":"money if the value of the security then declines or, if it has contracted to sell the security to another","page_number":374,"box":{"x":117,"y":102,"width":739,"height":13}},{"id":"17d3a0a4-d7df-48c9-b768-6f9254455ca4","block_type":"box","text":"party, the Fund could be liable to that party for any losses incurred.","page_number":374,"box":{"x":117,"y":118,"width":501,"height":12}},{"id":"aaf56557-9d89-4b55-9820-396cceef2025","block_type":"box","text":"Because of uncertainties in the operation of settlement systems in individual markets, competing","page_number":374,"box":{"x":117,"y":149,"width":720,"height":12}},{"id":"f2bab319-4b49-495b-86ab-1a63a63a9eee","block_type":"box","text":"claims may arise in respect of securities held by or to be transferred to a Fund. Compensation","page_number":374,"box":{"x":116,"y":165,"width":703,"height":12}},{"id":"50e6daa6-7cfb-4b34-86b6-740913e75ca1","block_type":"box","text":"schemes may not exist or may otherwise be limited or inadequate to meet the Fund’s claims in case of","page_number":374,"box":{"x":116,"y":180,"width":766,"height":12}},{"id":"f12f18cf-8a8e-40e6-bc40-3e0b5a0a9351","block_type":"box","text":"such event.","page_number":374,"box":{"x":116,"y":196,"width":90,"height":9}},{"id":"cccee7e5-9eec-4014-aca3-cf6a747413bb","block_type":"box","text":"Sovereign Debt.","page_number":374,"box":{"x":117,"y":227,"width":118,"height":12}},{"id":"fa09aaa4-d99b-406f-a586-87e400d0ef81","block_type":"box","text":"Investment in sovereign debt can involve a high degree of risk. The governmental","page_number":374,"box":{"x":236,"y":227,"width":616,"height":12}},{"id":"2ba118bf-03f2-44e6-b10a-31d7490951b5","block_type":"box","text":"entity that controls the repayment of sovereign debt may not be able or willing to repay the principal","page_number":374,"box":{"x":116,"y":242,"width":743,"height":12}},{"id":"7aa66032-865f-4678-a045-923c0f0b7176","block_type":"box","text":"and/or interest when due in accordance with the terms of such debt. A governmental entity’s","page_number":374,"box":{"x":116,"y":258,"width":689,"height":12}},{"id":"8c8526c0-a287-4c87-93ff-f0c4983d3386","block_type":"box","text":"willingness or ability to repay principal and interest due in a timely manner may be affected by, among","page_number":374,"box":{"x":116,"y":273,"width":761,"height":12}},{"id":"45847f24-51b9-4f9f-97bc-47b12f87839f","block_type":"box","text":"other factors, its cash flow situation, the extent of its foreign reserves, the availability of sufficient","page_number":374,"box":{"x":116,"y":289,"width":721,"height":12}},{"id":"52009f83-b9ee-4fac-a0c7-8a6d0e469748","block_type":"box","text":"foreign exchange on the date a payment is due, the relative size of the debt service burden to the","page_number":374,"box":{"x":116,"y":304,"width":728,"height":12}},{"id":"4d361eb8-d367-439d-a48e-e1792c6ea1c9","block_type":"box","text":"economy as a whole, the governmental entity’s policy towards the International Monetary Fund and the","page_number":374,"box":{"x":116,"y":320,"width":770,"height":12}},{"id":"d30c2419-c654-411f-8110-409307dd50c2","block_type":"box","text":"political constraints to which a governmental entity may be subject. Governmental entities may also be","page_number":374,"box":{"x":117,"y":335,"width":764,"height":12}},{"id":"aac832c3-e41a-4435-bb90-fed1c24dfe22","block_type":"box","text":"dependent on expected disbursements from foreign governments, multilateral agencies and others","page_number":374,"box":{"x":116,"y":351,"width":738,"height":12}},{"id":"9b5d1270-100a-46c4-bd52-a80c3d0619b5","block_type":"box","text":"abroad to reduce principal and interest arrearages on their debt. The commitment on the part of these","page_number":374,"box":{"x":116,"y":366,"width":761,"height":12}},{"id":"c2b9df9b-4f3b-427a-8386-1a7507718cc9","block_type":"box","text":"governments, agencies and others to make such disbursements may be conditioned on the","page_number":374,"box":{"x":116,"y":382,"width":684,"height":12}},{"id":"269847bc-5688-4eec-82de-9717cda86e9f","block_type":"box","text":"implementation of economic reforms and/or economic performance and the timely service of such","page_number":374,"box":{"x":117,"y":397,"width":730,"height":12}},{"id":"a1d23b1e-3d64-4389-9884-a6c642ad1a10","block_type":"box","text":"debtor’s obligations. Failure to implement such reforms, achieve such levels of economic performance","page_number":374,"box":{"x":116,"y":413,"width":763,"height":12}},{"id":"be132dc2-ba51-4923-8cc4-f957afe41a15","block_type":"box","text":"or repay principal or interest when due may result in the cancellation of such third parties’","page_number":374,"box":{"x":116,"y":428,"width":668,"height":12}},{"id":"ea51dc57-9e69-41dc-8857-29cebd2262fc","block_type":"box","text":"commitments to lend funds to the governmental entity, which may further impair such debtor’s ability or","page_number":374,"box":{"x":116,"y":444,"width":769,"height":12}},{"id":"bc6d75f2-06e4-40a2-9cbd-0f8b5137f059","block_type":"box","text":"willingness to timely service its debts. Consequently, governmental entities may default on their","page_number":374,"box":{"x":116,"y":459,"width":713,"height":12}},{"id":"6f6a2dfc-70af-4848-b6aa-571dd83079ca","block_type":"box","text":"sovereign debt.","page_number":374,"box":{"x":116,"y":475,"width":119,"height":12}},{"id":"82ea25a1-50e6-4c25-b7fc-271beb4899a6","block_type":"box","text":"Holders of sovereign debt may be requested to participate in the rescheduling of such debt and to","page_number":374,"box":{"x":117,"y":506,"width":730,"height":12}},{"id":"b033cdae-5c68-4c13-bbbc-7029df5f1c0a","block_type":"box","text":"extend further loans to governmental entities. In the event of a default by a governmental entity, there","page_number":374,"box":{"x":116,"y":521,"width":758,"height":12}},{"id":"b04ddbaf-756a-425f-86d3-35540e94bc08","block_type":"box","text":"may be few or no effective legal remedies for collecting on such debt.","page_number":374,"box":{"x":117,"y":537,"width":519,"height":12}},{"id":"8730afd4-a019-4dc9-a715-c644f1eb6db8","block_type":"box","text":"Withholding Tax Reclaims Risk","page_number":374,"box":{"x":118,"y":568,"width":230,"height":12}},{"id":"88baacac-7d6a-4524-a055-3a9df0a6ca74","block_type":"box","text":". A Fund may file claims to recover foreign withholding taxes on","page_number":374,"box":{"x":349,"y":568,"width":475,"height":12}},{"id":"d8f9ce54-5668-472c-bee1-330aa7140e54","block_type":"box","text":"dividend and interest income (if any) received from issuers in certain countries and capital gains on the","page_number":374,"box":{"x":116,"y":583,"width":768,"height":12}},{"id":"f88bf2e7-16be-4dc9-83b0-4f4c2e8bc5a9","block_type":"box","text":"disposition of stocks or securities where such withholding tax reclaim is possible. Whether or when a","page_number":374,"box":{"x":116,"y":599,"width":751,"height":12}},{"id":"5d3ed134-2e80-4797-a09c-567050d70618","block_type":"box","text":"Fund will receive a withholding tax refund is within the control of the tax authorities in such countries.","page_number":374,"box":{"x":117,"y":614,"width":751,"height":12}},{"id":"1af7a0dd-cc20-429b-9543-de3250791bd9","block_type":"box","text":"Where a Fund expects to recover withholding taxes, the net asset value of the Fund generally includes","page_number":374,"box":{"x":116,"y":630,"width":767,"height":12}},{"id":"ce1b2b05-8668-4906-b7e8-11b5dc2d21fa","block_type":"box","text":"accruals for such tax refunds. Each Fund regularly evaluates the probability of recovery. If the","page_number":374,"box":{"x":116,"y":645,"width":701,"height":12}},{"id":"25861556-93e9-4754-aad4-cfd29ea79c3d","block_type":"box","text":"likelihood of recovery materially decreases, due to, for example, a change in tax regulation or approach","page_number":374,"box":{"x":117,"y":661,"width":765,"height":12}},{"id":"0c108b71-cd7c-4bb0-a65a-5da8f5eb1b4e","block_type":"box","text":"in the foreign country, accruals in a Fund’s net asset value for such refunds may be written down","page_number":374,"box":{"x":117,"y":676,"width":716,"height":12}},{"id":"0c613870-d0fd-4f8a-a5b1-a8027524b647","block_type":"box","text":"partially or in full, which will adversely affect the Fund’s net asset value. Shareholders in a Fund at the","page_number":374,"box":{"x":117,"y":692,"width":755,"height":12}},{"id":"2229fd97-db12-4fe0-b5fb-bfffa355ca69","block_type":"box","text":"time an accrual is written down will bear the impact of the resulting reduction in net asset value","page_number":374,"box":{"x":116,"y":707,"width":703,"height":12}},{"id":"d8137f6b-418a-4ea5-82e7-b48fd9b488ab","block_type":"box","text":"regardless of whether they were shareholders during the accrual period. Conversely, if a Fund receives","page_number":374,"box":{"x":117,"y":723,"width":765,"height":12}},{"id":"1e4fe2d0-e7ac-45cd-8c56-b68e242492d7","block_type":"box","text":"a tax refund that has not been previously accrued, shareholders in the Fund at the time of the","page_number":374,"box":{"x":116,"y":738,"width":694,"height":12}},{"id":"9fefc3b7-0ab5-44d6-a234-a8ce7d63e9fb","block_type":"box","text":"successful recovery will benefit from the resulting increase in the Fund’s net asset value. Shareholders","page_number":374,"box":{"x":116,"y":754,"width":762,"height":12}},{"id":"03b50d7f-ece8-49ef-90b6-7c67d012fa06","block_type":"box","text":"who sold their shares prior to such time will not benefit from such increase in the Fund’s net asset","page_number":374,"box":{"x":116,"y":769,"width":725,"height":12}},{"id":"64c5fcfc-3541-4a31-86fe-d7cefe967a2a","block_type":"box","text":"value.","page_number":374,"box":{"x":116,"y":785,"width":43,"height":9}},{"id":"1ed3e234-1a7b-4397-a9fd-c03840a28fc0","block_type":"box","text":"U.S. Economic Trading Partners Risk.","page_number":374,"box":{"x":117,"y":816,"width":280,"height":12}},{"id":"cd9770ac-f570-491a-94c1-cab823892bc4","block_type":"box","text":"The United States is a significant, and in some cases the most","page_number":374,"box":{"x":404,"y":816,"width":464,"height":12}},{"id":"62028c25-ab3b-4d2b-b1b8-3f58be38cfb8","block_type":"box","text":"significant, trading partner of, or foreign investor in, certain countries in which a Fund may invest. As a","page_number":374,"box":{"x":116,"y":831,"width":762,"height":12}},{"id":"e0991b23-13ca-454f-bd3f-262fb6824d8f","block_type":"box","text":"result, economic conditions of such countries may be particularly affected by changes in the U.S.","page_number":374,"box":{"x":117,"y":847,"width":723,"height":12}},{"id":"b7ed858a-1501-4e9a-9cef-869200508074","block_type":"box","text":"economy. A decrease in U.S. imports or exports, new trade and financial regulations or tariffs, changes","page_number":374,"box":{"x":116,"y":862,"width":770,"height":12}},{"id":"cce03c50-e970-4555-8598-4f28f96e5972","block_type":"box","text":"in the U.S. dollar exchange rate or an economic slowdown in the United States may have a material","page_number":374,"box":{"x":117,"y":878,"width":745,"height":12}},{"id":"3db696c5-1fe0-4a04-a143-2e6d03b0f0bb","block_type":"box","text":"II-42","page_number":374,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"51b70c1a-94c3-40b7-97b4-5901906ab4b2","block_type":"box","text":"NM1026U-6004382-374/605","page_number":374,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9863215e-d1aa-4b6c-906d-1583e2991bb8","block_type":"box","text":"adverse effect on a country’s economic conditions and, as a result, securities to which the Fund has","page_number":375,"box":{"x":116,"y":87,"width":746,"height":12}},{"id":"9c06001e-520f-4217-823c-6d48c69ee6d1","block_type":"box","text":"exposure. Circumstances could arise that could prevent the timely payment of interest or principal on","page_number":375,"box":{"x":116,"y":102,"width":754,"height":13}},{"id":"03d9e93f-87c6-4472-975b-59ff530a829a","block_type":"box","text":"U.S. Government debt, such as reaching the legislative “debt ceiling.” Such non-payment would result","page_number":375,"box":{"x":117,"y":118,"width":760,"height":12}},{"id":"3b29be3a-fdb7-400a-af7e-2aa75845431e","block_type":"box","text":"in substantial negative consequences for the U.S. economy and the global financial system.","page_number":375,"box":{"x":117,"y":134,"width":685,"height":12}},{"id":"be59d048-9e7e-4c1e-a679-921f9e9d9f36","block_type":"box","text":"There are strained relations between the United States and a number of foreign countries, including","page_number":375,"box":{"x":116,"y":166,"width":745,"height":12}},{"id":"76a8ac5f-8238-4ec2-bbc6-5622816c3c04","block_type":"box","text":"traditional allies, such as certain European countries, and historical adversaries, such as North Korea,","page_number":375,"box":{"x":116,"y":182,"width":761,"height":11}},{"id":"e4e97895-d3fa-47c3-8bbb-25ef36909c58","block_type":"box","text":"Iran, China and Russia. If these relations were to worsen, it could adversely affect U.S. issuers as well","page_number":375,"box":{"x":117,"y":197,"width":763,"height":12}},{"id":"d00d691d-6004-4d82-b495-351c967f2a77","block_type":"box","text":"as non-U.S. issuers that rely on the United States for trade. The United States has also experienced","page_number":375,"box":{"x":116,"y":212,"width":748,"height":12}},{"id":"28331b81-85ce-4879-90a7-7d30c91eee89","block_type":"box","text":"increased internal unrest and discord. If these trends were to continue, it may have an adverse impact","page_number":375,"box":{"x":117,"y":228,"width":761,"height":12}},{"id":"d55f4fd4-9925-4248-b296-97b7d62a4ab3","block_type":"box","text":"on the U.S. economy and many of the issuers in which a Fund may invest.","page_number":375,"box":{"x":116,"y":243,"width":557,"height":12}},{"id":"45166c65-f73f-4179-92a2-c39bb0ce36ed","block_type":"box","text":"Funding Agreements.","page_number":375,"box":{"x":116,"y":276,"width":171,"height":12}},{"id":"e6abd79c-3d47-4797-b5c8-e7eedf2e937f","block_type":"box","text":"Certain Funds may invest in Guaranteed Investment Contracts and similar","page_number":375,"box":{"x":289,"y":276,"width":561,"height":12}},{"id":"e47f5c59-03e6-477e-84fe-5aff997a75dd","block_type":"box","text":"funding agreements. In connection with these investments, a Fund makes cash contributions to a","page_number":375,"box":{"x":116,"y":291,"width":727,"height":12}},{"id":"3244f801-eebe-4da3-b88c-ba9d4b4164eb","block_type":"box","text":"deposit fund of an insurance company’s general account. The insurance company then credits to the","page_number":375,"box":{"x":116,"y":307,"width":753,"height":12}},{"id":"bbe60ca2-3c42-41f7-8514-00e4fd5cbd75","block_type":"box","text":"Fund on a monthly basis guaranteed interest, which is based on an index. The funding agreements","page_number":375,"box":{"x":117,"y":322,"width":740,"height":12}},{"id":"54270637-399e-4fa7-8826-d68ebb3c1f95","block_type":"box","text":"provide that this guaranteed interest will not be less than a certain minimum rate. The purchase price","page_number":375,"box":{"x":117,"y":338,"width":753,"height":12}},{"id":"1fef4d69-719f-4335-b5c8-a8f379f40cc5","block_type":"box","text":"paid for a funding agreement becomes part of the general assets of the insurance company, and the","page_number":375,"box":{"x":117,"y":353,"width":749,"height":12}},{"id":"ba356e74-3088-4884-9f66-23ee5a2c9bf1","block_type":"box","text":"contract is paid from the general assets of the insurance company. Generally, funding agreements are","page_number":375,"box":{"x":116,"y":369,"width":764,"height":12}},{"id":"8a8f90e4-3160-4647-be13-c81c8e6299fe","block_type":"box","text":"not assignable or transferable without the permission of the issuing insurance companies, and an","page_number":375,"box":{"x":117,"y":384,"width":726,"height":12}},{"id":"6f5695e3-2cb9-43d6-a64d-92a0ed623784","block_type":"box","text":"active secondary market in some funding agreements does not currently exist.","page_number":375,"box":{"x":116,"y":400,"width":586,"height":12}},{"id":"e49902bf-9931-4254-95df-c08cb2c693b9","block_type":"box","text":"Guarantees","page_number":375,"box":{"x":117,"y":432,"width":91,"height":10}},{"id":"8b9eccfd-c4ad-40fc-ae87-b970b592b89f","block_type":"box","text":".","page_number":375,"box":{"x":209,"y":440,"width":3,"height":2}},{"id":"47fadfcb-4ad1-4fcc-9f14-0eb5fcc935e9","block_type":"box","text":"A Fund may purchase securities which contain guarantees issued by an entity separate","page_number":375,"box":{"x":213,"y":432,"width":660,"height":12}},{"id":"e2c0c381-63b6-47cb-bc07-a1d777cf0fe9","block_type":"box","text":"from the issuer of the security. Generally, the guarantor of a security (often an affiliate of the issuer) will","page_number":375,"box":{"x":116,"y":448,"width":771,"height":12}},{"id":"2b216105-986b-46ec-b7fc-9f9c46d3c65b","block_type":"box","text":"fulfill an issuer’s payment obligations under a security if the issuer is unable to do so.","page_number":375,"box":{"x":116,"y":463,"width":634,"height":12}},{"id":"32b89a04-e429-4c1c-8f49-d5dc7fa979e5","block_type":"box","text":"Illiquid Investments.","page_number":375,"box":{"x":116,"y":496,"width":157,"height":11}},{"id":"79571539-6dd7-456d-a522-1502fb1714f7","block_type":"box","text":"Each Fund may not acquire any illiquid in","page_number":375,"box":{"x":274,"y":496,"width":304,"height":12}},{"id":"52c1934e-a1a5-46e2-82d4-b04bcba69473","block_type":"box","text":"vestment if, immediately after the","page_number":375,"box":{"x":579,"y":496,"width":246,"height":12}},{"id":"4aec145b-7253-4394-a585-23abba598eaa","block_type":"box","text":"acquisition, a Fund would have invested more than 15% of","page_number":375,"box":{"x":116,"y":511,"width":431,"height":12}},{"id":"a0251f13-9b82-4f16-b280-53421bc2c422","block_type":"box","text":"its net assets in illiquid investments. An illiquid","page_number":375,"box":{"x":548,"y":511,"width":338,"height":12}},{"id":"059a76e6-4466-4ab9-b561-0a9afb7b689c","block_type":"box","text":"investment is any investment that a Fund reasonably","page_number":375,"box":{"x":117,"y":527,"width":388,"height":12}},{"id":"44157a10-5fa7-43e9-918b-c263eeded136","block_type":"box","text":"expects cannot be sold or disposed of in current","page_number":375,"box":{"x":505,"y":527,"width":354,"height":11}},{"id":"32de8c44-7e13-4b16-9aef-4c816d2ba442","block_type":"box","text":"market conditions in seven calendar days or less without","page_number":375,"box":{"x":117,"y":542,"width":410,"height":12}},{"id":"32b93f0f-8916-4044-8483-c87eebf73b47","block_type":"box","text":"t the sale or disposition significantly changing the","page_number":375,"box":{"x":527,"y":542,"width":356,"height":12}},{"id":"e57512d3-fbcb-4829-8d37-ae461f8aff95","block_type":"box","text":"market value of the investment. Liquid inves","page_number":375,"box":{"x":117,"y":558,"width":318,"height":12}},{"id":"28ab14c3-2911-4b35-871a-7f4592ea9237","block_type":"box","text":"tments may become illiquid after purchase by a Fund,","page_number":375,"box":{"x":436,"y":558,"width":395,"height":12}},{"id":"4abf3094-9bb4-47da-adb5-5313d74c21e4","block_type":"box","text":"particularly during periods of market turmoil. There can","page_number":375,"box":{"x":117,"y":573,"width":402,"height":12}},{"id":"86dd3a30-d013-4f39-9fb3-ce15697e45cc","block_type":"box","text":"be no assurance that a security or instrument that","page_number":375,"box":{"x":520,"y":573,"width":365,"height":12}},{"id":"e9f0ed5e-3056-4644-8987-dce4690ce377","block_type":"box","text":"is deemed to be liquid when purchased will continue to be liquid for as long as it is held by a Fund, and","page_number":375,"box":{"x":117,"y":589,"width":749,"height":12}},{"id":"54cb2a1d-14ba-4458-8260-a945b91db08b","block_type":"box","text":"any security or instrument held by the Fund may","page_number":375,"box":{"x":116,"y":604,"width":356,"height":12}},{"id":"1e159a82-22e3-440c-9586-6b5ac9efa2b8","block_type":"box","text":"be deemed an illiquid investment pursuant to the Fund’s","page_number":375,"box":{"x":473,"y":604,"width":411,"height":12}},{"id":"d05f1d93-642a-49b4-b592-7cbf6fd6f44c","block_type":"box","text":"liquidity risk management program. A Fund’s illiquid in","page_number":375,"box":{"x":117,"y":620,"width":391,"height":12}},{"id":"c721ff88-bd55-4ff6-8508-c4830246fb26","block_type":"box","text":"vestments may reduce the returns of the Fund","page_number":375,"box":{"x":509,"y":620,"width":341,"height":12}},{"id":"7c93045a-0b4f-4293-ba40-12b84f7d9df2","block_type":"box","text":"because it may be difficult to sell the illiquid investment","page_number":375,"box":{"x":117,"y":635,"width":397,"height":12}},{"id":"88402f31-e91f-4a7d-9735-c4153dfef92b","block_type":"box","text":"s at an advantageous time or price. In addition, if a","page_number":375,"box":{"x":514,"y":635,"width":373,"height":12}},{"id":"74193cb5-5457-4c59-a390-bae8ac4f2a00","block_type":"box","text":"Fund is limited in its ability to dispose of illiqui","page_number":375,"box":{"x":117,"y":651,"width":327,"height":12}},{"id":"d7bb0df6-48a2-42db-b11f-ab55f7ad2d21","block_type":"box","text":"d investments during periods when shareholders are","page_number":375,"box":{"x":445,"y":651,"width":387,"height":12}},{"id":"72974fdb-83f6-41ec-a63b-484026e48fff","block_type":"box","text":"redeeming or selling their shares or the Fund’s net","page_number":375,"box":{"x":117,"y":666,"width":365,"height":12}},{"id":"7b585dbe-ad47-46d3-a078-73e3ce81b26b","block_type":"box","text":"assets otherwise shrink, the Fund will need to dispose","page_number":375,"box":{"x":487,"y":666,"width":393,"height":12}},{"id":"248ba116-b1a6-429b-9896-62c207a7890e","block_type":"box","text":"of liquid securities to meet redemption requests and","page_number":375,"box":{"x":116,"y":682,"width":376,"height":12}},{"id":"3283f671-c96e-455d-8a6c-86b4ac769ff7","block_type":"box","text":"illiquid securities will become a larger portion of the","page_number":375,"box":{"x":498,"y":682,"width":369,"height":12}},{"id":"cf2df4cb-4d72-417d-a878-09de82d48c5d","block_type":"box","text":"Fund’s holdings. If illiquid investments exceed 15% of a","page_number":375,"box":{"x":117,"y":697,"width":401,"height":12}},{"id":"f7a286b9-c0f9-4ec5-a276-b7470d01fcd4","block_type":"box","text":"Fund’s net assets, the Liquidity Rule (as defined","page_number":375,"box":{"x":525,"y":697,"width":347,"height":12}},{"id":"3fa880c2-ae9b-4612-a465-e6b17717d520","block_type":"box","text":"below) and the Liquidity Program (as defined below) will r","page_number":375,"box":{"x":117,"y":713,"width":416,"height":12}},{"id":"d7ced085-0f12-41c6-9a67-bde1bced53f9","block_type":"box","text":"equire that certain remedial actions be taken.","page_number":375,"box":{"x":533,"y":713,"width":326,"height":12}},{"id":"f96cbb24-4b0e-4922-9cac-77f51219af7a","block_type":"box","text":"Illiquid investments may trade at a discount from com","page_number":375,"box":{"x":117,"y":728,"width":386,"height":12}},{"id":"bc5fe0d3-3ac5-4b66-bb6a-8f3870f7fdd5","block_type":"box","text":"parable liquid investments. Investment of a Fund’s","page_number":375,"box":{"x":505,"y":728,"width":364,"height":12}},{"id":"1c8a72bf-dc96-4e84-9fcf-5af295bf454e","block_type":"box","text":"assets in illiquid investments may restrict the ability of","page_number":375,"box":{"x":116,"y":744,"width":389,"height":12}},{"id":"63010bbd-d719-459c-b3c1-65fb7a9e78e1","block_type":"box","text":"the Fund to dispose of its investments in a timely","page_number":375,"box":{"x":509,"y":744,"width":355,"height":12}},{"id":"40ad4590-7ce3-406c-a630-6aab105119d5","block_type":"box","text":"fashion and for a fair price as well as its ability to take advantage of market opportunities. The risks","page_number":375,"box":{"x":116,"y":759,"width":716,"height":12}},{"id":"0a0e00ce-8cc7-4a0e-a4aa-8b35d7755e71","block_type":"box","text":"associated with illiquidity will be particularly acute w","page_number":375,"box":{"x":116,"y":775,"width":373,"height":12}},{"id":"d5cdf829-108d-4b80-97a5-b1635d3f224d","block_type":"box","text":"here a Fund’s operations require cash, such as when","page_number":375,"box":{"x":491,"y":775,"width":385,"height":12}},{"id":"96505ded-f683-4165-8ab0-d9b3bc8837c6","block_type":"box","text":"the Fund redeems shares or pays dividends, and could result in the Fund borrowing to meet short-term","page_number":375,"box":{"x":116,"y":790,"width":748,"height":12}},{"id":"91416654-b224-4fd6-900c-bf19b71ae4b3","block_type":"box","text":"cash requirements or incurring capital lo","page_number":375,"box":{"x":116,"y":806,"width":291,"height":12}},{"id":"b4f1917f-6c60-4173-b7aa-3e3ead8d5825","block_type":"box","text":"sses on the sale of illiquid investments.","page_number":375,"box":{"x":408,"y":806,"width":282,"height":12}},{"id":"d2462d91-5e58-43ea-ad07-7d170bb3710d","block_type":"box","text":"Index Funds.","page_number":375,"box":{"x":116,"y":838,"width":108,"height":10}},{"id":"5efd2262-f937-4204-af9e-c493654d90b6","block_type":"box","text":"Cash Flows; Expenses.","page_number":375,"box":{"x":117,"y":862,"width":173,"height":12}},{"id":"b4bed3cd-1015-4c96-b978-c5f2f54f20ed","block_type":"box","text":"The ability of each Fund to satisfy its investment objective depends to some","page_number":375,"box":{"x":291,"y":862,"width":573,"height":12}},{"id":"1db6e72a-dbb8-4a6e-a70b-8d913afdf90b","block_type":"box","text":"extent on the Manager’s ability to manage cash flow (primarily from purchases and redemptions and","page_number":375,"box":{"x":116,"y":877,"width":749,"height":12}},{"id":"071f79f3-fe42-43bf-91b6-c64c8d56c9fc","block_type":"box","text":"II-43","page_number":375,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"40784c4f-1550-40ab-a5f4-ddfdcbf6d22e","block_type":"box","text":"NM1026U-6004382-375/605","page_number":375,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"1a84bf45-0331-496a-84e7-6a54b2c1c610","block_type":"box","text":"distributions from the Fund’s investments). The Manager will make investment changes to a Fund’s","page_number":376,"box":{"x":116,"y":87,"width":742,"height":12}},{"id":"554fbc62-9d13-44ed-8a76-c95e50b6e753","block_type":"box","text":"portfolio to accommodate cash flow while continuing to seek to replicate the total return of the Fund’s","page_number":376,"box":{"x":117,"y":102,"width":753,"height":13}},{"id":"0136dcfb-69e5-41fe-b27d-7bab722469d6","block_type":"box","text":"target index. Investors should also be aware that the investment performance of each index is a","page_number":376,"box":{"x":116,"y":118,"width":716,"height":12}},{"id":"adff461b-7e13-4f82-8029-17492f9883d7","block_type":"box","text":"hypothetical number which does not take into account brokerage commissions and other transaction","page_number":376,"box":{"x":117,"y":134,"width":749,"height":12}},{"id":"c9bac234-9e09-437a-a6e0-4d264d6b9b29","block_type":"box","text":"costs, custody and other costs of investing, and any incremental operating costs (e.g., transfer agency","page_number":376,"box":{"x":116,"y":149,"width":765,"height":12}},{"id":"6e291d02-e281-4dda-bba0-16dd79da488c","block_type":"box","text":"and accounting costs) that will be borne by the Funds. Finally, since each Fund seeks to replicate the","page_number":376,"box":{"x":116,"y":165,"width":757,"height":12}},{"id":"d03dc745-031f-4ceb-ad6b-7cf9b5a40260","block_type":"box","text":"total return of its target index, the Manager generally will not attempt to judge the merits of any","page_number":376,"box":{"x":116,"y":180,"width":706,"height":12}},{"id":"f62b4224-869d-4605-86f4-32ef657a4183","block_type":"box","text":"particular security as an investment.","page_number":376,"box":{"x":117,"y":196,"width":272,"height":12}},{"id":"d28a0871-e048-4793-9f17-e0836a3229af","block_type":"box","text":"Tracking Error Risk","page_number":376,"box":{"x":118,"y":227,"width":143,"height":12}},{"id":"bd39232d-7a99-4ce1-8f74-d55a4151cf83","block_type":"box","text":". A Fund may be subject to tracking error, which is the divergence of the Fund’s","page_number":376,"box":{"x":261,"y":227,"width":594,"height":12}},{"id":"ebd106b2-7587-4b22-bef6-0e692c28bed4","block_type":"box","text":"performance from that of the Underlying Index. Tracking error may occur because of differences","page_number":376,"box":{"x":117,"y":242,"width":718,"height":12}},{"id":"6831986f-0b49-41c6-bfa3-c49698e7e5db","block_type":"box","text":"between the securities and other instruments held in the Fund’s portfolio and those included in the","page_number":376,"box":{"x":117,"y":258,"width":732,"height":11}},{"id":"b2f86521-3283-43be-b23c-f7546d3672cf","block_type":"box","text":"Underlying Index, pricing differences (including, as applicable, differences between a security’s price at","page_number":376,"box":{"x":117,"y":273,"width":768,"height":12}},{"id":"d541dd8e-6fe9-43d7-80f2-6dc58b03fc22","block_type":"box","text":"the local market close and the Fund’s valuation of a security at the time of calculation of the Fund’s net","page_number":376,"box":{"x":116,"y":289,"width":767,"height":12}},{"id":"0fc0e986-5c12-42c8-afb1-b496b27ff8fe","block_type":"box","text":"asset value), differences in transaction costs incurred by the Fund, the Fund’s holding of uninvested","page_number":376,"box":{"x":116,"y":304,"width":746,"height":12}},{"id":"53333019-b061-4b67-a2fb-1ca17527e5f4","block_type":"box","text":"cash, differences in timing of the accrual of or the valuation of dividends or other distributions, interest,","page_number":376,"box":{"x":116,"y":320,"width":764,"height":12}},{"id":"39a8a7a8-4149-4f96-8f94-738c66c9a1fc","block_type":"box","text":"the requirements to maintain pass-through tax treatment, portfolio transactions carried out to minimize","page_number":376,"box":{"x":116,"y":335,"width":763,"height":12}},{"id":"81aae751-6f35-4bc5-bb9f-34144b694001","block_type":"box","text":"the distribution of capital gains to shareholders, changes to the Underlying Index or the costs to the","page_number":376,"box":{"x":116,"y":351,"width":741,"height":12}},{"id":"128c6e54-fdb4-41eb-9263-0a1748a25381","block_type":"box","text":"Fund of complying with various new or existing regulatory requirements. These risks may be","page_number":376,"box":{"x":117,"y":366,"width":689,"height":12}},{"id":"b4dfc21d-c191-4637-b1a4-fdcbd48ffeeb","block_type":"box","text":"heightened during times of increased market volatility or other unusual market conditions. In addition,","page_number":376,"box":{"x":117,"y":382,"width":755,"height":12}},{"id":"88e1bced-165a-410c-8d3d-9df01ff9e0ca","block_type":"box","text":"tracking error may result because the Fund incurs fees and expenses, while the Underlying Index does","page_number":376,"box":{"x":116,"y":397,"width":769,"height":12}},{"id":"fb3d5e62-8825-4305-aa94-2e76ddd260c3","block_type":"box","text":"not.","page_number":376,"box":{"x":117,"y":413,"width":31,"height":9}},{"id":"96167cf1-4fe4-4131-8396-d5c7825f174a","block_type":"box","text":"When an issuer is introduced by an index provider into an index tracked by a Fund, the Manager may","page_number":376,"box":{"x":116,"y":444,"width":758,"height":12}},{"id":"e394863d-8908-4133-859b-78ebc1167dd5","block_type":"box","text":"conduct an analysis on such issuer’s securities to identify and screen for outlier high risk behavior","page_number":376,"box":{"x":116,"y":459,"width":729,"height":12}},{"id":"6aa1bbf6-6793-4e20-a424-d3f50958fcb8","block_type":"box","text":"(such as rapid or unusual price growth that does not appear to be supported by publicly available","page_number":376,"box":{"x":117,"y":475,"width":724,"height":12}},{"id":"4e8d67dc-5a53-43e4-8cc8-6e5dbb40f0d9","block_type":"box","text":"information on the business and assets of the issuer, unusual or significant short interest or lending","page_number":376,"box":{"x":117,"y":490,"width":740,"height":12}},{"id":"d74b992f-fa62-44e6-8d27-0148236ee17a","block_type":"box","text":"activity, negative sentiment, suspended trading or incorrect free-float calculations, which could be","page_number":376,"box":{"x":116,"y":506,"width":728,"height":12}},{"id":"9ce9e06e-cc53-4f01-a2cd-924b39855a4e","block_type":"box","text":"indicators of possible irregularities, miscalculations or even fraud). 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FTSE has no obligation to take the needs of any particular Fund or its","page_number":378,"box":{"x":116,"y":366,"width":694,"height":12}},{"id":"cc9f7bec-c6a4-4cdc-a523-c6b90de27c05","block_type":"box","text":"participants or any other product or person into consideration in determining, composing or calculating","page_number":378,"box":{"x":117,"y":382,"width":762,"height":12}},{"id":"c752a403-cc3c-4ece-b678-3bd28e88f598","block_type":"box","text":"the FTSE Index.","page_number":378,"box":{"x":116,"y":397,"width":126,"height":10}},{"id":"24db553e-126f-4e0e-ae55-407979d71dad","block_type":"box","text":"Bloomberg Indexes.","page_number":378,"box":{"x":116,"y":428,"width":148,"height":12}},{"id":"5606d114-33cf-461d-8f2b-a3bdadbc8381","block_type":"box","text":"No Fund is promoted, sponsored or endorsed by, nor in any way affiliated with","page_number":378,"box":{"x":265,"y":428,"width":592,"height":12}},{"id":"c0caef90-20d1-4acb-999d-7868fe254747","block_type":"box","text":"Bloomberg Finance L.P. and its affiliates (collectively, “Bloomberg”). Bloomberg is not responsible for","page_number":378,"box":{"x":117,"y":444,"width":754,"height":12}},{"id":"9ff2fc49-4338-4ac6-a8ec-ba65c09c5819","block_type":"box","text":"nor has it reviewed any Fund nor any associated literature or publications, and Bloomberg makes no","page_number":378,"box":{"x":117,"y":459,"width":750,"height":12}},{"id":"576e3629-4317-4ca4-97bc-0ae316bd3844","block_type":"box","text":"representation or warranty, express or implied, as to their accuracy, or completeness, or otherwise.","page_number":378,"box":{"x":117,"y":475,"width":740,"height":12}},{"id":"98118e31-ed06-4f1b-83b2-61d02c2f63d1","block_type":"box","text":"Bloomberg reserves the right, at any time and without notice, to alter, amend, terminate or in any way","page_number":378,"box":{"x":117,"y":506,"width":757,"height":12}},{"id":"5eddc436-282b-4eb8-8afb-df14e8052de0","block_type":"box","text":"change a Bloomberg Index. 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BofA is not the issuer or producer of the ICE BofA Indices, and its name is a","page_number":378,"box":{"x":117,"y":614,"width":728,"height":12}},{"id":"e8c58db1-d10f-4dac-8d65-268ed162a38a","block_type":"box","text":"trademark and service mark of its owner used under license. Neither ICE nor BofA is responsible for or","page_number":378,"box":{"x":116,"y":630,"width":768,"height":12}},{"id":"a30fc6ef-bf7c-4eb9-b2d2-cc1981d6b7fc","block_type":"box","text":"has reviewed any Fund nor any associated literature or publications and ICE and BofA make no","page_number":378,"box":{"x":117,"y":645,"width":715,"height":12}},{"id":"a6718482-b0b1-42dc-8f4d-190af69009c6","block_type":"box","text":"representation or warranty, express or implied, as to their accuracy, or completeness, or otherwise.","page_number":378,"box":{"x":117,"y":661,"width":734,"height":12}},{"id":"1186733d-8d8f-49e5-80e2-a33562e368e1","block_type":"box","text":"ICE reserves the right, at any time and without notice, to alter, amend, terminate or in any way change","page_number":378,"box":{"x":117,"y":692,"width":758,"height":12}},{"id":"59fe8376-9ea6-4eb8-97c4-4d7a2c43ba85","block_type":"box","text":"an ICE BofA Index. ICE has no obligation to take the needs of any particular Fund or its participants or","page_number":378,"box":{"x":116,"y":707,"width":761,"height":12}},{"id":"11a35c34-999b-474e-a42b-35089169e7c2","block_type":"box","text":"any other product or person into consideration in determining, composing or calculating an ICE BofA","page_number":378,"box":{"x":116,"y":723,"width":745,"height":12}},{"id":"1d8f0844-e99d-445a-9f03-880c7aa1c6f8","block_type":"box","text":"Index.","page_number":378,"box":{"x":117,"y":738,"width":43,"height":10}},{"id":"1b40b898-f8a2-453c-8a80-4fe29535e9be","block_type":"box","text":"Indexed and Inverse Securities.","page_number":378,"box":{"x":116,"y":769,"width":250,"height":10}},{"id":"59235c31-f0bd-4418-804b-509b268b18ad","block_type":"box","text":"A Fund may invest in securities that provide a potential return based","page_number":378,"box":{"x":372,"y":769,"width":506,"height":12}},{"id":"d0fc3171-3822-4393-8cd9-4aacc8ee5fc8","block_type":"box","text":"on a particular index of value or interest rates. For example, a Fund may invest in securities that pay","page_number":378,"box":{"x":116,"y":785,"width":745,"height":12}},{"id":"4d53aced-d7b7-4693-91d4-a5daaa91aeb4","block_type":"box","text":"interest based on an index of interest rates. The principal amount payable upon maturity of certain","page_number":378,"box":{"x":117,"y":800,"width":727,"height":12}},{"id":"fe356590-932d-4172-afa3-3aafb14657ae","block_type":"box","text":"securities also may be based on the value of the index. To the extent a Fund invests in these types of","page_number":378,"box":{"x":116,"y":816,"width":755,"height":12}},{"id":"763cf941-85e6-4f47-a753-79f2fc071c0d","block_type":"box","text":"securities, the Fund’s return on such securities will be subject to risk with respect to the value of the","page_number":378,"box":{"x":116,"y":831,"width":744,"height":12}},{"id":"7576c240-9161-416c-967a-a5ed205c570f","block_type":"box","text":"particular index: that is, if the value of the index falls, the value of the indexed securities owned by the","page_number":378,"box":{"x":117,"y":847,"width":758,"height":12}},{"id":"78450313-e20f-4501-b213-bacb86df2ed3","block_type":"box","text":"Fund will fall. Interest and principal payable on certain securities may also be based on relative","page_number":378,"box":{"x":117,"y":862,"width":708,"height":12}},{"id":"55535362-55b5-4509-b37e-c54c54d42dd4","block_type":"box","text":"changes among particular indices. 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A Fund may purchase synthetically-created inverse floating rate bonds evidenced","page_number":379,"box":{"x":117,"y":118,"width":759,"height":12}},{"id":"2e96d73f-f53f-40db-887d-5cd1a5c5836c","block_type":"box","text":"by custodial or trust receipts. Generally, income on inverse floating rate bonds will decrease when","page_number":379,"box":{"x":117,"y":134,"width":730,"height":12}},{"id":"e35c46e1-9289-4f4b-8f45-08f66ca25638","block_type":"box","text":"interest rates increase, and will increase when interest rates decrease. Such securities have the effect","page_number":379,"box":{"x":117,"y":149,"width":762,"height":11}},{"id":"d3bd1587-a75f-4c8b-a7ed-6f204f4a4889","block_type":"box","text":"of providing a degree of investment leverage, since they may increase or decrease in value in","page_number":379,"box":{"x":116,"y":165,"width":701,"height":12}},{"id":"97f6c4f9-7b7a-485c-9780-70e388a26a49","block_type":"box","text":"response to changes, as an illustration, in market interest rates at a rate that is a multiple of the rate at","page_number":379,"box":{"x":117,"y":180,"width":764,"height":12}},{"id":"a6289c01-55ff-49c2-8c16-d2fe10d7d0ef","block_type":"box","text":"which fixed-rate securities increase or decrease in response to such changes. As a result, the market","page_number":379,"box":{"x":116,"y":196,"width":757,"height":12}},{"id":"5702c937-b256-4296-86c9-b1bd6c3b0e99","block_type":"box","text":"values of such securities will generally be more volatile than the market values of fixed-rate securities.","page_number":379,"box":{"x":116,"y":211,"width":761,"height":12}},{"id":"652273d7-e3bf-429a-a414-f50bc2edd8cd","block_type":"box","text":"To seek to limit the volatility of these securities, a Fund may purchase inverse floating obligations that","page_number":379,"box":{"x":116,"y":227,"width":758,"height":12}},{"id":"46b145ae-cdcb-459a-b65d-c2607b525dc9","block_type":"box","text":"have shorter-term maturities or that contain limitations on the extent to which the interest rate may","page_number":379,"box":{"x":117,"y":242,"width":732,"height":12}},{"id":"b321efda-b2b3-4b66-bdf1-6d37ccdf4dbe","block_type":"box","text":"vary. Certain investments in such obligations may be illiquid. The Manager believes that indexed and","page_number":379,"box":{"x":116,"y":258,"width":754,"height":12}},{"id":"b58b1463-a719-422f-a771-6eeae6d3462a","block_type":"box","text":"inverse floating obligations represent flexible portfolio management instruments for a Fund that allow","page_number":379,"box":{"x":117,"y":273,"width":751,"height":12}},{"id":"06bb27f0-2c51-4bb6-9a9c-817a76cdbb7c","block_type":"box","text":"the Fund to seek potential investment rewards, hedge other portfolio positions or vary the degree of","page_number":379,"box":{"x":116,"y":289,"width":744,"height":12}},{"id":"6ca8f6d8-6f3b-4678-a7bb-1b26ddcb4759","block_type":"box","text":"investment leverage relatively efficiently under different market conditions. A Fund may invest in","page_number":379,"box":{"x":117,"y":304,"width":716,"height":12}},{"id":"d3eccaa4-e5e1-47b1-b6e3-3053181a1597","block_type":"box","text":"indexed and inverse securities for hedging purposes or to seek to increase returns. When used for","page_number":379,"box":{"x":117,"y":320,"width":734,"height":12}},{"id":"39bf2472-0c79-4228-806f-8def09e88c66","block_type":"box","text":"hedging purposes, indexed and inverse securities involve correlation risk. Furthermore, where such a","page_number":379,"box":{"x":117,"y":335,"width":755,"height":12}},{"id":"b9518613-ba4e-4f8a-b5b6-32cad9a07ad0","block_type":"box","text":"security includes a contingent liability, in the event of an adverse movement in the underlying index or","page_number":379,"box":{"x":116,"y":351,"width":759,"height":12}},{"id":"5af6db38-3aaa-4344-b871-a3f42e02fb12","block_type":"box","text":"interest rate, a Fund may be required to pay substantial additional margin to maintain the position.","page_number":379,"box":{"x":117,"y":366,"width":731,"height":12}},{"id":"2d211f8c-89e6-4b57-9198-1786e56017d8","block_type":"box","text":"The Funds may invest up to 10% of their total assets in leveraged inverse floating rate debt","page_number":379,"box":{"x":116,"y":397,"width":682,"height":12}},{"id":"e24f7993-a98c-4e14-b73d-24b750d6a5db","block_type":"box","text":"instruments (“inverse floaters”). Inverse floaters are securities the potential of which is inversely related","page_number":379,"box":{"x":117,"y":413,"width":768,"height":12}},{"id":"3299f131-f6a7-4b14-bc6b-aecf695cf393","block_type":"box","text":"to changes in interest rates. In general, the return on inverse floaters will decrease when short-term","page_number":379,"box":{"x":116,"y":428,"width":743,"height":12}},{"id":"c7968bca-c136-40bd-a164-a32eea2e24f2","block_type":"box","text":"interest rates increase and increase when short-term rates decrease. Municipal tender option bonds,","page_number":379,"box":{"x":117,"y":444,"width":751,"height":12}},{"id":"12581bd2-0b93-4064-a792-b6b70ccef381","block_type":"box","text":"both taxable and tax-exempt, which may include inverse floating rate debt instruments, (including","page_number":379,"box":{"x":117,"y":459,"width":725,"height":12}},{"id":"25576754-2daf-43ca-9d2d-aad14191e50f","block_type":"box","text":"residual interests thereon) are excluded from this 10% limitation.","page_number":379,"box":{"x":117,"y":475,"width":483,"height":12}},{"id":"3526f54b-5fc8-4b8a-801c-35ae836d1cb3","block_type":"box","text":"Inflation Risk.","page_number":379,"box":{"x":116,"y":506,"width":109,"height":9}},{"id":"e6a2b150-9d85-42bc-ae43-de364b286772","block_type":"box","text":"Like all funds, the Funds are subject to inflation risk. Inflation risk is the risk that the","page_number":379,"box":{"x":226,"y":506,"width":627,"height":12}},{"id":"79f4d3ae-1415-4553-be81-7ddb790b8063","block_type":"box","text":"present value of assets or income from investments will be less in the future as inflation decreases the","page_number":379,"box":{"x":117,"y":521,"width":763,"height":12}},{"id":"a551303a-9e56-487b-98dc-a64c2e13b039","block_type":"box","text":"value of money. As inflation increases, the present value of a Fund’s assets can decline as can the","page_number":379,"box":{"x":116,"y":537,"width":739,"height":12}},{"id":"691b2bfb-46e1-4e02-a6ec-bdda3f0bdaec","block_type":"box","text":"value of a Fund’s distributions. Inflation rates may change frequently and significantly due to a number","page_number":379,"box":{"x":116,"y":552,"width":764,"height":12}},{"id":"6b0211cf-0cc9-464b-9f03-0655911f6fba","block_type":"box","text":"of potential factors, including, among others, unexpected economic shifts or changes in fiscal or","page_number":379,"box":{"x":116,"y":568,"width":716,"height":12}},{"id":"1b9d9082-9cb6-4716-b09c-090b2a4c400c","block_type":"box","text":"monetary policies.","page_number":379,"box":{"x":117,"y":583,"width":139,"height":12}},{"id":"11355480-939a-4a74-812a-7a96cb4fa4f4","block_type":"box","text":"Initial Public Offering (“IPO”) Risk.","page_number":379,"box":{"x":116,"y":614,"width":275,"height":12}},{"id":"9963329e-9b56-4623-bc4e-45f7f37ff3fd","block_type":"box","text":"The volume of IPOs and the levels at which the newly issued","page_number":379,"box":{"x":392,"y":614,"width":462,"height":12}},{"id":"4cd797df-5ea1-477a-860b-df2f52ea6402","block_type":"box","text":"stocks trade in the secondary market are affected by the performance of the stock market overall. If","page_number":379,"box":{"x":116,"y":630,"width":743,"height":12}},{"id":"3502cd79-dffe-4ef5-be78-d72b930a402e","block_type":"box","text":"IPOs are brought to the market, availability may be limited and a Fund may not be able to buy any","page_number":379,"box":{"x":117,"y":645,"width":732,"height":12}},{"id":"2506fda2-b5c6-4234-a2e8-9b7098f25829","block_type":"box","text":"shares at the offering price, or if it is able to buy shares, it may not be able to buy as many shares at","page_number":379,"box":{"x":116,"y":661,"width":744,"height":12}},{"id":"4663d6fb-638e-4ddf-bd04-e87244eb3cbe","block_type":"box","text":"the offering price as it would like. In addition, the prices of securities involved in IPOs are often subject","page_number":379,"box":{"x":116,"y":676,"width":758,"height":12}},{"id":"b7b70ab8-a14a-4f82-bd71-40a4e6710dda","block_type":"box","text":"to greater and more unpredictable price changes than more established stocks. IPOs have the","page_number":379,"box":{"x":116,"y":692,"width":701,"height":12}},{"id":"fe5cf380-ea99-40eb-aec9-e17a8eeb8d86","block_type":"box","text":"potential to produce substantial gains. A Fund may hold shares from an IPO for only a short period of","page_number":379,"box":{"x":117,"y":707,"width":751,"height":12}},{"id":"ded07d92-5254-4542-8cb5-85280a361599","block_type":"box","text":"time given possible price volatility. This may result in increased portfolio turnover and expenses, such","page_number":379,"box":{"x":116,"y":723,"width":752,"height":12}},{"id":"7b748dc3-d8d6-4468-aa93-80041a481493","block_type":"box","text":"as commissions and transaction costs, and potentially result in taxable gains that the Fund will","page_number":379,"box":{"x":116,"y":738,"width":699,"height":12}},{"id":"22eb59d9-589f-4210-b354-3cbfe15789b8","block_type":"box","text":"subsequently distribute to shareholders. There is no assurance that any Fund will have access to","page_number":379,"box":{"x":116,"y":754,"width":720,"height":12}},{"id":"892a6c63-07c1-4497-bc2b-c637821fcd88","block_type":"box","text":"profitable IPOs and therefore investors should not rely on any past gains from IPOs as an indication of","page_number":379,"box":{"x":117,"y":769,"width":759,"height":12}},{"id":"ab016d28-08eb-43e7-9a67-35f1712542ad","block_type":"box","text":"future performance. The investment performance of a Fund during periods when it is unable to invest","page_number":379,"box":{"x":116,"y":785,"width":750,"height":12}},{"id":"41436ba5-e0fd-46f4-86d0-d848a89ff014","block_type":"box","text":"significantly or at all in IPOs may be lower than during periods when it is able to do so. In addition, as a","page_number":379,"box":{"x":116,"y":800,"width":763,"height":12}},{"id":"0c7dfd16-7d0c-4cb3-8a1c-8ff49118b659","block_type":"box","text":"Fund increases in size, the impact of IPOs on its performance will generally decrease. Securities","page_number":379,"box":{"x":117,"y":816,"width":716,"height":12}},{"id":"19882a51-da31-4307-a621-de428f00a0e9","block_type":"box","text":"issued in IPOs are subject to many of the same risks as investing in companies with smaller market","page_number":379,"box":{"x":117,"y":831,"width":743,"height":12}},{"id":"81be38fb-2e96-4504-a782-cc8719679163","block_type":"box","text":"capitalizations. Securities issued in IPOs have no trading history, and information about the companies","page_number":379,"box":{"x":116,"y":847,"width":768,"height":12}},{"id":"5d5a06a0-b304-4102-b74b-27327bcd4deb","block_type":"box","text":"may be available for very limited periods.","page_number":379,"box":{"x":117,"y":862,"width":308,"height":12}},{"id":"0d819757-7b27-4f2b-af0f-a75a6a336110","block_type":"box","text":"II-47","page_number":379,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"88770b8d-589e-4fbe-9f48-a6e0af71e85f","block_type":"box","text":"NM1026U-6004382-379/605","page_number":379,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"845f5921-38f3-474c-a68c-aeea026e3aec","block_type":"box","text":"Investment in Emerging Markets.","page_number":380,"box":{"x":116,"y":87,"width":268,"height":12}},{"id":"c31fb22c-e274-4c45-8750-05c80efb94bd","block_type":"box","text":"General.","page_number":380,"box":{"x":117,"y":109,"width":68,"height":9}},{"id":"733d30d4-daba-4d26-82c8-3f27122e4796","block_type":"box","text":"Certain Funds may invest in the securities of issuers domiciled in various countries with emerging","page_number":380,"box":{"x":117,"y":130,"width":727,"height":13}},{"id":"25ce609f-d835-4189-8825-7518e9c5599d","block_type":"box","text":"capital markets. Unless otherwise provided in a Fund’s Prospectus, a country with an emerging capital","page_number":380,"box":{"x":116,"y":146,"width":765,"height":12}},{"id":"e4907e5a-9db4-4e9b-96d0-ba38ddd12e60","block_type":"box","text":"market is any country that is (i) generally recognized to be an emerging market country by the","page_number":380,"box":{"x":117,"y":161,"width":700,"height":13}},{"id":"b7905984-13e1-45e2-9ea4-a424f544a5af","block_type":"box","text":"international financial community, such as the International Finance Corporation, or","page_number":380,"box":{"x":117,"y":177,"width":617,"height":12}},{"id":"9c9a83cc-9aa9-4ef3-a5f6-a5d436df704f","block_type":"box","text":"determined by the","page_number":380,"box":{"x":739,"y":177,"width":139,"height":12}},{"id":"0f795122-511d-4eb4-95db-af4098312470","block_type":"box","text":"World Bank to have a low, middle or middle upper income economy; (ii) classified by the United","page_number":380,"box":{"x":116,"y":192,"width":714,"height":13}},{"id":"4eb1c9fc-0b1e-492f-8f62-ce5b9ca3141a","block_type":"box","text":"Nations or its authorities to be developing; and/or (iii) included in a broad-based index that is generally","page_number":380,"box":{"x":117,"y":208,"width":762,"height":12}},{"id":"76576d30-0394-4d8c-a382-0d683b99cb1c","block_type":"box","text":"representative of emerging markets. Countries with emerging markets can be found in regions such as","page_number":380,"box":{"x":117,"y":223,"width":766,"height":13}},{"id":"6a8f49f5-4151-435d-926c-5179de321310","block_type":"box","text":"Asia, Latin America, Eastern Europe and Africa.","page_number":380,"box":{"x":116,"y":239,"width":361,"height":12}},{"id":"f7ca94e6-def8-4dc4-9594-01b3331312b9","block_type":"box","text":"Investments in the securities of issuers domiciled in countries with emerging capital markets involve","page_number":380,"box":{"x":117,"y":267,"width":743,"height":12}},{"id":"2811f403-1400-4a40-834d-74ee78be8668","block_type":"box","text":"certain additional risks that do not generally apply to investments in securities of issuers in more","page_number":380,"box":{"x":116,"y":282,"width":717,"height":12}},{"id":"e2475e32-4e35-4779-adb7-fb7cbb53cc53","block_type":"box","text":"developed capital markets, such as (i) low or non-existent trading volume, resulting in market illiquidity","page_number":380,"box":{"x":116,"y":298,"width":763,"height":12}},{"id":"3edf58cf-8da8-4441-ab2e-2b3204e6c785","block_type":"box","text":"and increased volatility in prices for such securities, as compared to securities of comparable issuers in","page_number":380,"box":{"x":116,"y":313,"width":771,"height":12}},{"id":"b24da443-9d3b-4a64-bc5f-54bebbb415e4","block_type":"box","text":"more developed capital markets; (ii) uncertain national policies and social, political and economic","page_number":380,"box":{"x":117,"y":329,"width":723,"height":12}},{"id":"69cd5faa-e3af-48a4-ac6e-eeaa6a90e421","block_type":"box","text":"instability, increasing the potential for expropriation of assets, confiscatory taxation, high rates of","page_number":380,"box":{"x":117,"y":344,"width":718,"height":12}},{"id":"4b9786aa-e724-4a2d-8c96-15449a870417","block_type":"box","text":"inflation or unfavorable diplomatic developments; (iii) possible fluctuations in exchange rates, differing","page_number":380,"box":{"x":117,"y":360,"width":758,"height":12}},{"id":"facdeb0c-e764-410c-8333-74c2c1643f73","block_type":"box","text":"legal systems and the existence or possible imposition of exchange controls, custodial restrictions or","page_number":380,"box":{"x":117,"y":375,"width":750,"height":12}},{"id":"a7774a87-0eb0-47e2-b2a5-d00413608126","block_type":"box","text":"other foreign or U.S. Governmental laws or restrictions applicable to such investments; (iv) national","page_number":380,"box":{"x":116,"y":391,"width":741,"height":12}},{"id":"ef740202-7510-4b05-9e86-b2de75393b24","block_type":"box","text":"policies that may limit a Fund’s investment opportunities such as restrictions on investment in issuers","page_number":380,"box":{"x":117,"y":407,"width":754,"height":11}},{"id":"da1ab80a-e7c0-4d95-8ce6-03c0c22e1dae","block_type":"box","text":"or industries deemed sensitive to national interests; and (v) the lack or relatively early development of","page_number":380,"box":{"x":116,"y":422,"width":759,"height":12}},{"id":"8875d36f-8182-46e1-bedb-d5352c6549d9","block_type":"box","text":"legal structures governing private and foreign investments and private property. In addition to","page_number":380,"box":{"x":117,"y":437,"width":695,"height":12}},{"id":"ff62444d-2eec-4dbb-abe7-1a8073573b0d","block_type":"box","text":"withholding taxes on investment income, some countries with emerging markets may impose","page_number":380,"box":{"x":116,"y":453,"width":695,"height":12}},{"id":"1cb4036f-b3e5-423a-abc6-87baf47f7599","block_type":"box","text":"differential capital gains taxes on foreign investors.","page_number":380,"box":{"x":116,"y":468,"width":381,"height":12}},{"id":"59ec2293-2996-4d07-a6fd-5338087450ee","block_type":"box","text":"Political and economic structures in emerging mark","page_number":380,"box":{"x":117,"y":496,"width":371,"height":12}},{"id":"83562e96-3710-40e5-ac3f-3d7ae23cef67","block_type":"box","text":"et countries may be undergoing significant evolution","page_number":380,"box":{"x":489,"y":496,"width":382,"height":12}},{"id":"a7b6d564-ac06-42e6-8745-a5015328dfb9","block_type":"box","text":"and rapid development, and these countries may la","page_number":380,"box":{"x":116,"y":512,"width":373,"height":12}},{"id":"8e6f50cf-869d-4f8b-9d34-920e0e290f5b","block_type":"box","text":"ck the social, political and economic stability","page_number":380,"box":{"x":490,"y":512,"width":324,"height":12}},{"id":"215bd33f-56a6-4d46-b78e-d052ce36e2e7","block_type":"box","text":"characteristic of more developed countries. In such a dynamic environment, there can be no assurance","page_number":380,"box":{"x":116,"y":527,"width":755,"height":12}},{"id":"51201906-53fc-45b9-9e3c-509f122a2391","block_type":"box","text":"that any or all of these capital markets will continue","page_number":380,"box":{"x":116,"y":543,"width":375,"height":12}},{"id":"d6bb425c-9aea-4998-8730-8b26897f7b28","block_type":"box","text":"to present viable investment opportunities for a Fund.","page_number":380,"box":{"x":491,"y":543,"width":392,"height":12}},{"id":"4d84edc1-3be7-4350-a47a-c98a50ff29fc","block_type":"box","text":"In the past, governments of such nations have expr","page_number":380,"box":{"x":117,"y":558,"width":373,"height":12}},{"id":"2618bdb4-cb84-4c51-9594-bc554d1c4385","block_type":"box","text":"opriated substantial amount","page_number":380,"box":{"x":490,"y":558,"width":201,"height":12}},{"id":"4f41262c-6f68-4f72-9f7a-e5d7b3caf53c","block_type":"box","text":"s of private property, and","page_number":380,"box":{"x":692,"y":558,"width":186,"height":12}},{"id":"5091d423-25be-479a-99ad-61a5efd2e4fa","block_type":"box","text":"most claims of the property owners have never been f","page_number":380,"box":{"x":117,"y":574,"width":386,"height":12}},{"id":"aef70089-1a27-44c6-9b45-5d6465a79e04","block_type":"box","text":"fully settled. There is no assurance that such","page_number":380,"box":{"x":503,"y":574,"width":330,"height":12}},{"id":"84193fec-925a-489d-ad96-6e94f32773cb","block_type":"box","text":"expropriations will not reoccur. In such an event, it is","page_number":380,"box":{"x":116,"y":589,"width":380,"height":12}},{"id":"1308ce3a-1ae9-42a6-bcfe-1831a110ab3c","block_type":"box","text":"possible that a Fund could lose the entire value of","page_number":380,"box":{"x":496,"y":589,"width":372,"height":12}},{"id":"2f9d9c1b-11d7-45d3-ac8e-a81498e5827e","block_type":"box","text":"its investments in the affected market. As a re","page_number":380,"box":{"x":117,"y":605,"width":331,"height":9}},{"id":"58b77da4-bc15-484a-a9d6-04a014d0467d","block_type":"box","text":"sult the risks described above, including the risks of","page_number":380,"box":{"x":449,"y":605,"width":379,"height":12}},{"id":"41565e9d-a8cc-48b5-ae98-f0ac849f88cd","block_type":"box","text":"nationalization or expropriation of assets, may be hei","page_number":380,"box":{"x":117,"y":620,"width":382,"height":12}},{"id":"e9d4f779-56d0-4b1f-919d-e69883271988","block_type":"box","text":"ghtened. In addition, unanticipated political or social","page_number":380,"box":{"x":500,"y":620,"width":380,"height":12}},{"id":"460f097e-7e8d-4bff-8665-29e5f19ac079","block_type":"box","text":"developments may affect the value of investments in","page_number":380,"box":{"x":116,"y":636,"width":381,"height":12}},{"id":"5e64d870-6a7e-44a2-93ee-1b3a4d6de994","block_type":"box","text":"these countries and the availability to a Fund of","page_number":380,"box":{"x":498,"y":636,"width":353,"height":12}},{"id":"4878727a-1e84-4bca-848d-b295f97eab1d","block_type":"box","text":"additional investments. The small size and inexperience","page_number":380,"box":{"x":116,"y":651,"width":411,"height":12}},{"id":"87b78ef2-ac89-4a75-94cf-25dba8193af9","block_type":"box","text":"of the securities markets in certain of these","page_number":380,"box":{"x":528,"y":651,"width":316,"height":10}},{"id":"0fd0afdd-effd-4fe0-ad6d-0400e8c8fcad","block_type":"box","text":"countries and the limited volume of trading in securities","page_number":380,"box":{"x":116,"y":667,"width":399,"height":12}},{"id":"00e73319-6568-404b-bdf5-7f0072d40ec2","block_type":"box","text":"in these countries may make investments in the","page_number":380,"box":{"x":522,"y":667,"width":345,"height":12}},{"id":"584218a0-d32e-48eb-9bff-df2fc5d59ebc","block_type":"box","text":"countries illiquid and more volatile than investments in more established markets.","page_number":380,"box":{"x":116,"y":682,"width":589,"height":12}},{"id":"b2b7320e-33e5-45f2-80b9-c4a1fbf44ff7","block_type":"box","text":"Also, there may be less publicly available information about issuers in emerging markets than would be","page_number":380,"box":{"x":116,"y":710,"width":765,"height":12}},{"id":"a64c86b6-06b0-4e3f-be0c-c4624945cef7","block_type":"box","text":"available about issuers in more developed capital markets, and such issuers may not be subject to","page_number":380,"box":{"x":116,"y":726,"width":732,"height":12}},{"id":"dcadbae6-d7b7-4a5a-88f9-edceff07c39a","block_type":"box","text":"accounting, auditing and financial reporting standards and requirements comparable to those to which","page_number":380,"box":{"x":116,"y":741,"width":756,"height":12}},{"id":"afd54440-ed88-417e-a086-a05610742b7b","block_type":"box","text":"U.S. companies are subject. In certain countries with emerging capital markets, reporting standards","page_number":380,"box":{"x":117,"y":757,"width":737,"height":12}},{"id":"f5de2568-2350-4952-9d8f-7e48c6d6b91c","block_type":"box","text":"vary widely. As a result, traditional investment measurements used in the United States, such as price/","page_number":380,"box":{"x":116,"y":772,"width":762,"height":12}},{"id":"d6fd2f30-0121-49e0-9f74-db9ded38d671","block_type":"box","text":"earnings ratios, may not be applicable. Emerging market securities may be substantially less liquid","page_number":380,"box":{"x":116,"y":788,"width":731,"height":12}},{"id":"a7d49270-23b6-4270-b710-bad0d3e905c2","block_type":"box","text":"than, and more volatile than, those of mature markets, and company shares may be held by a limited","page_number":380,"box":{"x":116,"y":803,"width":749,"height":12}},{"id":"c8d18271-3819-474e-98dd-e29163c31947","block_type":"box","text":"number of persons. This may adversely affect the timing and pricing of the Fund’s acquisition or","page_number":380,"box":{"x":117,"y":819,"width":710,"height":12}},{"id":"2d374352-2148-472d-9b48-3a15f1bf55ca","block_type":"box","text":"disposal of securities.","page_number":380,"box":{"x":116,"y":834,"width":165,"height":12}},{"id":"384c1e85-c3cb-4332-b3b9-8cddd9a27e2d","block_type":"box","text":"Practices in relation to settlement of securities transactions in emerging markets involve higher risks","page_number":380,"box":{"x":117,"y":862,"width":746,"height":12}},{"id":"b4f7d6d2-234c-46c7-9a50-a94d6bb5360f","block_type":"box","text":"than those in developed markets, in part because a Fund will need to use brokers and counterparties","page_number":380,"box":{"x":116,"y":878,"width":755,"height":12}},{"id":"750450fd-0bdf-431f-9866-90ec46a8a6bf","block_type":"box","text":"II-48","page_number":380,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"80dd5c84-90ec-4190-9602-5f67c2c3bd13","block_type":"box","text":"NM1026U-6004382-380/605","page_number":380,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"7ee79a24-e866-48c9-aa85-9f9c2b67abab","block_type":"box","text":"that are less well capitalized, and custody and registration of assets in some countries may be","page_number":381,"box":{"x":116,"y":87,"width":703,"height":12}},{"id":"85300bb4-591e-4c49-acc5-2f226b0f97c6","block_type":"box","text":"unreliable. The possibility of fraud, negligence, undue influence being exerted by the issuer or refusal","page_number":381,"box":{"x":117,"y":102,"width":754,"height":13}},{"id":"5907c566-4c42-456c-85d4-f87bee14de2a","block_type":"box","text":"to recognize ownership exists in some emerging markets, and, along with other factors, could result in","page_number":381,"box":{"x":116,"y":118,"width":762,"height":12}},{"id":"c41cf9b7-3152-48a3-b37d-0fdd69605d90","block_type":"box","text":"ownership registration being completely lost. A Fund would absorb any loss resulting from such","page_number":381,"box":{"x":116,"y":134,"width":712,"height":12}},{"id":"0d7a20c0-9357-48fa-aabe-d511d4075cf4","block_type":"box","text":"registration problems and may have no successful claim for compensation.","page_number":381,"box":{"x":117,"y":149,"width":560,"height":12}},{"id":"91b003ce-1fdf-41f4-829f-acd00f03bb24","block_type":"box","text":"Investment in non-dollar denominated securities including securities from issuers located in emerging","page_number":381,"box":{"x":117,"y":180,"width":755,"height":12}},{"id":"60849899-f70e-4d87-864b-45e9f72c92bf","block_type":"box","text":"market countries may be on either a currency hedged or unhedged basis, and the Funds may hold","page_number":381,"box":{"x":117,"y":196,"width":735,"height":12}},{"id":"4e2887af-73b0-45ef-8129-c1bc694d1839","block_type":"box","text":"from time to time various foreign currencies pending investment or conversion into U.S. dollars. Some","page_number":381,"box":{"x":116,"y":211,"width":761,"height":12}},{"id":"ca7c52f9-f2a1-4e73-acec-811110838024","block_type":"box","text":"of these instruments may have the characteristics of futures contracts. In addition, certain Funds may","page_number":381,"box":{"x":116,"y":227,"width":757,"height":12}},{"id":"73da04c8-38b9-45e8-9ab0-04cfd7e9845e","block_type":"box","text":"engage in foreign currency exchange transactions to seek to protect against changes in the level of","page_number":381,"box":{"x":116,"y":242,"width":742,"height":12}},{"id":"e70f6efb-1acc-4dd8-bb41-389cd8e096c0","block_type":"box","text":"future exchange rates which would adversely affect the Fund’s performance. These investments and","page_number":381,"box":{"x":116,"y":258,"width":752,"height":12}},{"id":"1fe833dd-3b1e-4826-b125-0a657e3fd84e","block_type":"box","text":"transactions involving foreign securities, currencies, options (including options that relate to foreign","page_number":381,"box":{"x":116,"y":273,"width":738,"height":12}},{"id":"c174cf03-2333-4d03-bdd9-098ab3af6d7b","block_type":"box","text":"currencies), futures, hedging and cross-hedging are described under “Derivatives.”","page_number":381,"box":{"x":116,"y":289,"width":619,"height":12}},{"id":"625815bd-8514-4b26-85e2-54358aa9bb65","block_type":"box","text":"Risks of Investing in Asia-Pacific Countries.","page_number":381,"box":{"x":116,"y":320,"width":328,"height":12}},{"id":"bed84c2e-2175-4333-9f5f-924aef0ac098","block_type":"box","text":"In addition to the risks of foreign investing and the risks of","page_number":381,"box":{"x":445,"y":320,"width":432,"height":12}},{"id":"14ac6705-16d4-4a1b-8a3f-14a33bc7d865","block_type":"box","text":"investing in developing markets, the developing market Asia-Pacific countries in which a Fund may","page_number":381,"box":{"x":117,"y":335,"width":738,"height":12}},{"id":"4664884c-57de-4ad4-9759-e2f03c660dd0","block_type":"box","text":"invest are subject to certain additional or specific risks. Certain Funds may make substantial","page_number":381,"box":{"x":117,"y":351,"width":687,"height":12}},{"id":"6b0332db-ed4e-495b-a42b-80dca6757e5b","block_type":"box","text":"investments in Asia-Pacific countries. In many of these markets, there is a high concentration of market","page_number":381,"box":{"x":117,"y":366,"width":771,"height":12}},{"id":"9f8a52fd-4fad-405a-ba0e-59a864a8e0b1","block_type":"box","text":"capitalization and trading volume in a small number of issuers representing a limited number of","page_number":381,"box":{"x":116,"y":382,"width":710,"height":12}},{"id":"b38b81d4-80be-47ac-a65a-64a0be92ef34","block_type":"box","text":"industries, as well as a high concentration of investors and financial intermediaries. Many of these","page_number":381,"box":{"x":117,"y":397,"width":730,"height":12}},{"id":"9fdacf6f-a4a2-4f20-9dc8-ffc68bae626d","block_type":"box","text":"markets also may be affected by developments with respect to more established markets in the region","page_number":381,"box":{"x":117,"y":413,"width":763,"height":12}},{"id":"b5c5c9cf-e4cc-4198-ae2f-ea3862eda59b","block_type":"box","text":"such as in Japan and Hong Kong. Brokers in developing market Asia-Pacific countries typically are","page_number":381,"box":{"x":116,"y":428,"width":739,"height":12}},{"id":"b60e2076-2a97-407d-9db9-a62bfa9862ad","block_type":"box","text":"fewer in number and less well capitalized than brokers in the United States. These factors, combined","page_number":381,"box":{"x":116,"y":444,"width":754,"height":12}},{"id":"4cd42ce9-bc38-4278-a818-d3103ea1c0db","block_type":"box","text":"with the U.S. regulatory requirements for open-end investment companies and the restrictions on","page_number":381,"box":{"x":116,"y":459,"width":725,"height":12}},{"id":"75fa15f6-e86f-4238-bc36-5ebce1396a1b","block_type":"box","text":"foreign investment discussed below, result in potentially fewer investment opportunities for a Fund and","page_number":381,"box":{"x":116,"y":475,"width":766,"height":12}},{"id":"3b500fbc-655f-4291-b888-98ce1c68e401","block_type":"box","text":"may have an adverse impact on the investment performance of the Fund.","page_number":381,"box":{"x":117,"y":490,"width":550,"height":12}},{"id":"46b331e4-5e00-4d4b-ba10-7b1d4049ad6a","block_type":"box","text":"Many of the developing market Asia-Pacific countries may be subject to a greater degree of economic,","page_number":381,"box":{"x":117,"y":521,"width":757,"height":12}},{"id":"0bd86714-11b2-4fff-af2d-e7a2aa32122d","block_type":"box","text":"political and social instability than is the case in the United States and Western European countries.","page_number":381,"box":{"x":117,"y":537,"width":736,"height":12}},{"id":"cc6f6623-908a-4a27-83dd-ea3c120e2159","block_type":"box","text":"Such instability may result from, among other things: (i) authoritarian governments or military","page_number":381,"box":{"x":116,"y":552,"width":686,"height":12}},{"id":"fc31e299-c2e6-452e-a6ad-9b8b839d8a04","block_type":"box","text":"involvement in political and economic decision-making, including changes in government through extra","page_number":381,"box":{"x":117,"y":568,"width":759,"height":12}},{"id":"bee08580-9992-43cf-90b3-c621246145cb","block_type":"box","text":"constitutional means; (ii) popular unrest associated with demands for improved political, economic and","page_number":381,"box":{"x":116,"y":583,"width":757,"height":12}},{"id":"634afe22-1b2b-44fb-a4c9-e3e17d0faaba","block_type":"box","text":"social conditions; (iii) internal insurgencies; (iv) hostile relations with neighboring countries; and","page_number":381,"box":{"x":116,"y":599,"width":703,"height":12}},{"id":"b3f798ea-8648-47ab-8c87-112e0c30dd27","block_type":"box","text":"(v) ethnic, religious and racial disaffection. In addition, the governments of many of such countries, such","page_number":381,"box":{"x":117,"y":614,"width":767,"height":12}},{"id":"62fcab21-cfb5-4b87-a937-1d0e22ffe26a","block_type":"box","text":"as Indonesia, have a substantial role in regulating and supervising the economy. Another risk common","page_number":381,"box":{"x":116,"y":630,"width":758,"height":12}},{"id":"b157021d-8860-4bdc-97b5-d6256a82723d","block_type":"box","text":"to most such countries is that the economy is heavily export oriented and, accordingly, is dependent","page_number":381,"box":{"x":116,"y":645,"width":740,"height":12}},{"id":"5069fffc-bdbb-48dd-8591-3503c4232e56","block_type":"box","text":"upon international trade. The existence of overburdened infrastructure and obsolete financial systems","page_number":381,"box":{"x":117,"y":661,"width":745,"height":12}},{"id":"a69cc1fd-b028-476d-a874-fd70bf21c0c4","block_type":"box","text":"also presents risks in certain countries, as do environmental problems. Certain economies also depend","page_number":381,"box":{"x":116,"y":676,"width":757,"height":12}},{"id":"1bd5b742-5eda-41f8-a8cf-092e53b106e7","block_type":"box","text":"to a significant degree upon exports of primary commodities and, therefore, are vulnerable to changes in","page_number":381,"box":{"x":116,"y":692,"width":766,"height":12}},{"id":"034e9e9a-8f20-489b-ab2c-8e7b64ac6253","block_type":"box","text":"commodity prices that, in turn, may be affected by a variety of factors.","page_number":381,"box":{"x":116,"y":707,"width":511,"height":12}},{"id":"076d8297-3dd9-4e2f-b306-dcef53df3a92","block_type":"box","text":"The legal systems in certain developing market Asia-Pacific countries also may have an adverse","page_number":381,"box":{"x":116,"y":738,"width":717,"height":12}},{"id":"b6d228c3-e937-4c62-a228-5b8faa08f2fd","block_type":"box","text":"impact on the Fund. For example, while the potential liability of a shareholder in a U.S. corporation with","page_number":381,"box":{"x":117,"y":754,"width":763,"height":12}},{"id":"cb911348-af83-4dc2-996f-90b6c4611b99","block_type":"box","text":"respect to acts of the corporation is generally limited to the amount of the shareholder’s investment, the","page_number":381,"box":{"x":117,"y":769,"width":766,"height":12}},{"id":"37832022-9d9f-45a1-abfe-dd1ba79bff6b","block_type":"box","text":"notion of limited liability is less clear in certain emerging market Asia-Pacific countries. Similarly, the","page_number":381,"box":{"x":117,"y":785,"width":739,"height":12}},{"id":"13607827-6e5f-4ce2-99e6-262a0bc0c1fe","block_type":"box","text":"rights of investors in developing market Asia-Pacific companies may be more limited than those of","page_number":381,"box":{"x":117,"y":800,"width":728,"height":12}},{"id":"fc01dfdc-1ad4-4a15-96fd-085dcf4cc202","block_type":"box","text":"shareholders of U.S. corporations. It may be difficult or impossible to obtain and/or enforce a judgment","page_number":381,"box":{"x":116,"y":816,"width":761,"height":12}},{"id":"e07b3f9c-046e-4117-a9e3-090efeb96867","block_type":"box","text":"in a developing market Asia-Pacific country.","page_number":381,"box":{"x":117,"y":831,"width":330,"height":12}},{"id":"0ed1fe60-da68-45cb-9f6b-e9d8f0612a8f","block_type":"box","text":"Governments of many developing market Asia-Pacific countries have exercised and continue to","page_number":381,"box":{"x":117,"y":862,"width":714,"height":12}},{"id":"997d36c6-5093-4a34-8616-064ce867444f","block_type":"box","text":"exercise substantial influence over many aspects of the private sector. In certain cases, the","page_number":381,"box":{"x":116,"y":878,"width":683,"height":12}},{"id":"00e5e84a-5daa-449a-a31e-d2790a6404e1","block_type":"box","text":"II-49","page_number":381,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"f3dde637-3f6c-4ee3-853b-4e8c28b91f45","block_type":"box","text":"NM1026U-6004382-381/605","page_number":381,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"e0464b1c-d2f2-4d38-9ec1-ad60bfcaf528","block_type":"box","text":"government owns or controls many companies, including the largest in the country. Accordingly,","page_number":382,"box":{"x":116,"y":87,"width":718,"height":12}},{"id":"2b32aea1-3cd5-4e1f-ad17-e4f21d1efd68","block_type":"box","text":"government actions in the future could have a significant effect on economic conditions in developing","page_number":382,"box":{"x":116,"y":102,"width":755,"height":13}},{"id":"c1783d19-c220-448b-bf9f-34ae589c07ee","block_type":"box","text":"market Asia-Pacific countries, which could affect private sector companies and a Fund itself, as well as","page_number":382,"box":{"x":117,"y":118,"width":768,"height":12}},{"id":"d623f3a6-cbdf-4830-9c1a-f635f44b1420","block_type":"box","text":"the value of securities in the Fund’s portfolio. In addition, economic statistics of developing market","page_number":382,"box":{"x":116,"y":134,"width":731,"height":12}},{"id":"6f257fb2-ad42-4993-85a7-9f9005c91790","block_type":"box","text":"Asia-Pacific countries may be less reliable than economic statistics of more developed nations.","page_number":382,"box":{"x":116,"y":149,"width":710,"height":12}},{"id":"2e98aa76-bb2d-4369-8afc-1cc4f8d6cf1e","block_type":"box","text":"In addition to the relative lack of publicly available information about developing market Asia-Pacific","page_number":382,"box":{"x":117,"y":180,"width":741,"height":12}},{"id":"41d2a1ac-a85d-4483-aa03-3b6b1b0a222f","block_type":"box","text":"issuers and the possibility that such issuers may not be subject to the same accounting, auditing and","page_number":382,"box":{"x":117,"y":196,"width":752,"height":12}},{"id":"4fa54354-9a43-4701-8b66-e6d703b5e58d","block_type":"box","text":"financial reporting standards as U.S. companies, inflation accounting rules in some developing market","page_number":382,"box":{"x":116,"y":211,"width":762,"height":12}},{"id":"337a4402-d630-468c-a82b-e38b39d13956","block_type":"box","text":"Asia-Pacific countries require companies that keep accounting records in the local currency, for both","page_number":382,"box":{"x":116,"y":227,"width":750,"height":12}},{"id":"92cf0366-8b13-4f3b-9b54-0d32dfa2ec6b","block_type":"box","text":"tax and accounting purposes, to restate certain assets and liabilities on the company’s balance sheet","page_number":382,"box":{"x":116,"y":242,"width":755,"height":12}},{"id":"f8653910-b12d-4acc-b9a2-51440c1abf58","block_type":"box","text":"in order to express items in terms of currency of constant purchasing power. Inflation accounting may","page_number":382,"box":{"x":117,"y":258,"width":756,"height":12}},{"id":"e3726e30-3253-4214-a584-662b5f05edd6","block_type":"box","text":"indirectly generate losses or profits for certain developing market Asia-Pacific companies.","page_number":382,"box":{"x":117,"y":273,"width":669,"height":12}},{"id":"f6853574-6f1a-4142-a947-f0145988e747","block_type":"box","text":"Satisfactory custodial services for investment securities may not be available in some developing Asia","page_number":382,"box":{"x":116,"y":304,"width":762,"height":12}},{"id":"7cadbe2c-5672-41a9-9ec8-a16bcdbde81e","block_type":"box","text":"Pacific countries, which may result in the Fund incurring additional costs and delays in providing","page_number":382,"box":{"x":117,"y":320,"width":716,"height":12}},{"id":"cd36b815-d2af-4605-aee1-ad55bc5bec4b","block_type":"box","text":"transportation and custody services for such securities outside such countries.","page_number":382,"box":{"x":116,"y":335,"width":586,"height":12}},{"id":"5bbd98ff-f7a0-4df0-b748-4792bb36e23f","block_type":"box","text":"Certain developing Asia-Pacific countries, such as the Philippines, India and Turkey, are especially","page_number":382,"box":{"x":117,"y":366,"width":738,"height":12}},{"id":"ff353d01-d5f3-4ae8-9cda-2d547fd3fa26","block_type":"box","text":"large debtors to commercial banks and foreign governments.","page_number":382,"box":{"x":117,"y":382,"width":456,"height":12}},{"id":"4cd2f6d3-770a-4e66-9b84-968623b21e50","block_type":"box","text":"Natural disasters in Asia-Pacific countries, and the resulting damage, could have a severe and","page_number":382,"box":{"x":117,"y":413,"width":705,"height":12}},{"id":"85b59cec-200d-4284-b842-0bd549e2d36b","block_type":"box","text":"negative impact on a Fund’s investment portfolio and, in the longer term, could impair the ability of","page_number":382,"box":{"x":117,"y":428,"width":732,"height":12}},{"id":"a84eb8e6-db56-40e0-b486-2461ad46f116","block_type":"box","text":"issuers in which the Fund invests to conduct their businesses in the manner normally conducted.","page_number":382,"box":{"x":117,"y":444,"width":722,"height":12}},{"id":"cb5d1604-40c0-4cba-b33c-625e0d6fb16e","block_type":"box","text":"Fund management may determine that, notwithstanding otherwise favorable investment criteria, it may","page_number":382,"box":{"x":117,"y":475,"width":766,"height":12}},{"id":"668f51bb-44fd-4dc7-97f3-643253d77dfe","block_type":"box","text":"not be practicable or appropriate to invest in a particular developing Asia-Pacific country. A Fund may","page_number":382,"box":{"x":117,"y":490,"width":757,"height":12}},{"id":"bd5fed34-e44b-4cfb-adf3-9df96291d2f1","block_type":"box","text":"invest in countries in which foreign investors, including management of the Fund, have had no or","page_number":382,"box":{"x":117,"y":506,"width":722,"height":12}},{"id":"9a1e26a5-437c-4bae-b36e-0220f5cf16c5","block_type":"box","text":"limited prior experience.","page_number":382,"box":{"x":117,"y":521,"width":182,"height":12}},{"id":"c7c9f4e8-c863-4a3c-b3ce-73b7c29ccecb","block_type":"box","text":"Restrictions on Foreign Investments in Asia-Pacific Countries.","page_number":382,"box":{"x":116,"y":552,"width":458,"height":12}},{"id":"433cc431-ed2a-4d1d-8a77-61bffd19a121","block_type":"box","text":"Some developing Asia-Pacific countries","page_number":382,"box":{"x":576,"y":552,"width":305,"height":12}},{"id":"e87cab2b-8de5-44c7-96bb-e0702ac70df7","block_type":"box","text":"prohibit or impose substantial restrictions on investments in their capital markets, particularly their","page_number":382,"box":{"x":117,"y":568,"width":728,"height":12}},{"id":"67deeb2c-259c-4fc3-bfac-26a16b3e9137","block_type":"box","text":"equity markets, by foreign entities such as a Fund. As illustrations, certain countries may require","page_number":382,"box":{"x":116,"y":583,"width":719,"height":12}},{"id":"6530fe26-2566-4cf5-b501-8cae81244d04","block_type":"box","text":"governmental approval prior to investments by foreign persons or limit the amount of investment by","page_number":382,"box":{"x":116,"y":599,"width":741,"height":12}},{"id":"88bcf067-9eb7-49e7-b535-508f9959e762","block_type":"box","text":"foreign persons in a particular company or limit the investment by foreign persons to only a specific","page_number":382,"box":{"x":116,"y":614,"width":740,"height":12}},{"id":"bff740a7-3dc3-40da-8dca-9f6617814c3d","block_type":"box","text":"class of securities of a company which may have less advantageous terms (including price and","page_number":382,"box":{"x":116,"y":630,"width":711,"height":12}},{"id":"9ff54754-31be-467b-b5e0-a75457b28db5","block_type":"box","text":"shareholder rights) than securities of the company available for purchase by nationals. There can be","page_number":382,"box":{"x":116,"y":645,"width":750,"height":12}},{"id":"f4ffd585-5d41-4e1d-8d8c-7d0c5e7f8df5","block_type":"box","text":"no assurance that a Fund will be able to obtain required governmental approvals in a timely manner. In","page_number":382,"box":{"x":117,"y":661,"width":762,"height":12}},{"id":"f425c0f3-78fb-4505-b9b6-932a78cd028d","block_type":"box","text":"addition, changes to restrictions on foreign ownership of securities subsequent to a Fund’s purchase of","page_number":382,"box":{"x":116,"y":676,"width":765,"height":12}},{"id":"eeaf91d1-cd55-434c-b392-63097b7b9ac8","block_type":"box","text":"such securities may have an adverse effect on the value of such shares. Certain countries may restrict","page_number":382,"box":{"x":116,"y":692,"width":761,"height":12}},{"id":"98fd4418-bc19-467e-ae3e-1e5133e4c028","block_type":"box","text":"investment opportunities in issuers or industries deemed important to national interests.","page_number":382,"box":{"x":117,"y":707,"width":647,"height":12}},{"id":"18cb0718-a255-4ed8-b074-ee9121480887","block_type":"box","text":"The manner in which foreign investors may invest in companies in certain developing Asia-Pacific","page_number":382,"box":{"x":116,"y":738,"width":724,"height":12}},{"id":"f3d0cd3d-5142-4ba3-8454-348bc3a2c93c","block_type":"box","text":"countries, as well as limitations on such investments, also may have an adverse impact on the","page_number":382,"box":{"x":116,"y":754,"width":700,"height":12}},{"id":"e89e24b2-4825-4a72-b83a-fa9f42c1373f","block_type":"box","text":"operations of a Fund. For example, a Fund may be required in certain of such countries to invest","page_number":382,"box":{"x":116,"y":769,"width":717,"height":12}},{"id":"d2d6ad04-cc7d-4a5d-8c78-4001300ac740","block_type":"box","text":"initially through a local broker or other entity and then have the shares purchased re-registered in the","page_number":382,"box":{"x":117,"y":785,"width":748,"height":12}},{"id":"76f77f98-7d1d-46b5-ad69-5532a5008bb1","block_type":"box","text":"name of the Fund. Re-registration may in some instances not be able to occur on a timely basis,","page_number":382,"box":{"x":117,"y":800,"width":712,"height":12}},{"id":"4726ab48-b9f1-4d02-9727-826d1f5d4b3e","block_type":"box","text":"resulting in a delay during which a Fund may be denied certain of its rights as an investor, including","page_number":382,"box":{"x":117,"y":816,"width":736,"height":12}},{"id":"5ae4d1f4-896d-4f13-8562-0d638df8369d","block_type":"box","text":"rights as to dividends or to be made aware of certain corporate actions. There also may be instances","page_number":382,"box":{"x":117,"y":831,"width":753,"height":12}},{"id":"586b92f8-15d7-4144-8677-d15a34dad1e1","block_type":"box","text":"where a Fund places a purchase order but is subsequently informed, at the time of re-registration, that","page_number":382,"box":{"x":116,"y":847,"width":764,"height":12}},{"id":"28ad023f-a6e8-40e2-832f-8298fe03613e","block_type":"box","text":"the permissible allocation of the investment to foreign investors has been filled, depriving the Fund of","page_number":382,"box":{"x":116,"y":862,"width":754,"height":12}},{"id":"95dd1628-d802-4ab3-ae96-acec2f925854","block_type":"box","text":"the ability to make its desired investment at that time.","page_number":382,"box":{"x":116,"y":878,"width":400,"height":12}},{"id":"6633e86e-56c0-416c-8de7-91845cc08113","block_type":"box","text":"II-50","page_number":382,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"1a36ffc5-f0ca-4745-9505-f5fa4bced728","block_type":"box","text":"NM1026U-6004382-382/605","page_number":382,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"0d99ce0b-35ce-475b-a473-65bbf3264e16","block_type":"box","text":"Substantial limitations may exist in certain countries with respect to a Fund’s ability to repatriate","page_number":383,"box":{"x":116,"y":87,"width":714,"height":12}},{"id":"18e11f43-e16a-465d-a32e-3e175ea91ca0","block_type":"box","text":"investment income, capital or the proceeds of sales of securities by foreign investors. A Fund could be","page_number":383,"box":{"x":117,"y":102,"width":763,"height":13}},{"id":"b12cb14f-33b2-4481-9620-4288b401a769","block_type":"box","text":"adversely affected by delays in, or a refusal to grant, any required governmental approval for","page_number":383,"box":{"x":116,"y":118,"width":693,"height":12}},{"id":"83bb98eb-63fc-4efc-8d39-33bbf047e5fd","block_type":"box","text":"repatriation of capital, as well as by the application to the Fund of any restrictions on investments. It is","page_number":383,"box":{"x":117,"y":134,"width":759,"height":12}},{"id":"768ab325-4ceb-499c-a610-0670771320b7","block_type":"box","text":"possible that certain countries may impose currency controls or other restrictions relating to their","page_number":383,"box":{"x":117,"y":149,"width":719,"height":12}},{"id":"f78bdadf-4dfa-4c50-9879-744d51615fb0","block_type":"box","text":"currencies or to securities of issuers in those countries. To the extent that such restrictions have the","page_number":383,"box":{"x":116,"y":165,"width":746,"height":9}},{"id":"c6dd08c8-677b-458d-88f5-27656563b80c","block_type":"box","text":"effect of making certain investments illiquid, securities may not be available for sale to meet","page_number":383,"box":{"x":116,"y":180,"width":685,"height":12}},{"id":"859d08f1-eead-4d47-9364-e3f4c9fcb777","block_type":"box","text":"redemptions. Depending on a variety of financial factors, the percentage of a Fund’s portfolio subject to","page_number":383,"box":{"x":117,"y":196,"width":770,"height":12}},{"id":"4289c054-4d72-4b25-99c1-956fc1fcabe4","block_type":"box","text":"currency controls may increase. In the event other countries impose similar controls, the portion of the","page_number":383,"box":{"x":116,"y":211,"width":763,"height":12}},{"id":"8452b5f1-b317-4395-9dee-14eb98ff01c0","block_type":"box","text":"Fund’s assets that may be used to meet redemptions may be further decreased. Even where there is","page_number":383,"box":{"x":117,"y":227,"width":754,"height":12}},{"id":"9dbe9bf1-6d27-43b8-92c7-2f1c332ba6ec","block_type":"box","text":"no outright restriction on repatriation of capital, the mechanics of repatriation may affect certain aspects","page_number":383,"box":{"x":117,"y":242,"width":771,"height":12}},{"id":"01414d16-d5e7-4dfc-bbed-83171b3ff1b6","block_type":"box","text":"of the operations of a Fund (for example, if funds may be withdrawn only in certain currencies and/or","page_number":383,"box":{"x":116,"y":258,"width":751,"height":12}},{"id":"c13812c0-e15a-4976-af4b-01df19f78122","block_type":"box","text":"only at an exchange rate established by the government).","page_number":383,"box":{"x":116,"y":273,"width":433,"height":12}},{"id":"aaf6b808-24d9-43e6-b578-aa4b32d8e018","block_type":"box","text":"In certain countries, banks or other financial institutions may be among the leading companies or have","page_number":383,"box":{"x":117,"y":304,"width":763,"height":12}},{"id":"b4b3e65e-3e7f-4dac-8a11-8dd5afbe9937","block_type":"box","text":"actively traded securities available for investment. The Investment Company Act restricts a Fund’s","page_number":383,"box":{"x":116,"y":320,"width":734,"height":12}},{"id":"50ecee2e-5a78-4629-8700-67fbb0508832","block_type":"box","text":"investments in any equity securities of an issuer that, in its most recent fiscal year, derived more than","page_number":383,"box":{"x":117,"y":335,"width":755,"height":12}},{"id":"01f8d9a6-fa50-4a0e-8dba-28282197354b","block_type":"box","text":"15% of its revenues from “securities related activities,” as defined by the rules thereunder. These","page_number":383,"box":{"x":118,"y":351,"width":722,"height":12}},{"id":"d207976c-1aae-4f71-94bc-0606c5230537","block_type":"box","text":"provisions may restrict a Fund’s investments in certain foreign banks and other financial institutions.","page_number":383,"box":{"x":117,"y":366,"width":744,"height":12}},{"id":"7f706f70-4b95-428a-84f4-854b6dddd036","block_type":"box","text":"Political and economic structures in emerging market countries may be undergoing significant","page_number":383,"box":{"x":117,"y":397,"width":699,"height":12}},{"id":"6fccff39-befe-4d5f-9b49-ae3a8adfa264","block_type":"box","text":"evolution and rapid development, and these countries may lack the social, political and economic","page_number":383,"box":{"x":116,"y":413,"width":726,"height":12}},{"id":"6e308231-41ef-4de6-9531-0b3361f92713","block_type":"box","text":"stability characteristic of more developed countries. Some of these countries may have in the past","page_number":383,"box":{"x":116,"y":428,"width":732,"height":12}},{"id":"5f2200f7-3e09-4102-94bc-851fd8c8e916","block_type":"box","text":"failed to recognize private property rights and have at times nationalized or expropriated the assets of","page_number":383,"box":{"x":116,"y":444,"width":759,"height":12}},{"id":"a394479f-f8e6-4c2d-b486-40733b83c279","block_type":"box","text":"private companies. As a result the risks described above, including the risks of nationalization or","page_number":383,"box":{"x":117,"y":459,"width":718,"height":12}},{"id":"30a5170d-e14e-4736-af3f-5377c8961650","block_type":"box","text":"expropriation of assets, may be heightened. In addition, unanticipated political or social developments","page_number":383,"box":{"x":116,"y":475,"width":760,"height":12}},{"id":"8fb58284-adb5-4434-af5f-69bd6eee40db","block_type":"box","text":"may affect the value of investments in these countries and the availability to a Fund of additional","page_number":383,"box":{"x":117,"y":490,"width":718,"height":12}},{"id":"cc782e0c-f542-42b8-86ac-e3ab175fd20c","block_type":"box","text":"investments in emerging market countries. The small size and inexperience of the securities markets in","page_number":383,"box":{"x":117,"y":506,"width":770,"height":12}},{"id":"dfbd3b93-1ecf-4fad-9be4-880864db4362","block_type":"box","text":"certain of these countries and the limited volume of trading in securities in these countries may make","page_number":383,"box":{"x":116,"y":521,"width":753,"height":12}},{"id":"b28db1ca-6620-4cba-9dad-05fe39261dc3","block_type":"box","text":"investments in the countries illiquid and more volatile than investments in Japan or most Western","page_number":383,"box":{"x":117,"y":537,"width":725,"height":12}},{"id":"3990e0d1-be22-4d0e-8714-da754b46a3ef","block_type":"box","text":"European countries. There may be little financial or accounting information available with respect to","page_number":383,"box":{"x":117,"y":552,"width":741,"height":12}},{"id":"e439952d-68d1-4f26-87cf-633ffa6d604e","block_type":"box","text":"issuers located in certain emerging market countries, and it may be difficult to assess the value or","page_number":383,"box":{"x":117,"y":568,"width":729,"height":12}},{"id":"6ecc5b6f-3722-4f6d-8b97-9dc1c45c1719","block_type":"box","text":"prospects of an investment in such issuers.","page_number":383,"box":{"x":117,"y":583,"width":325,"height":12}},{"id":"8b2f5370-5918-4776-8f49-fcd474e0f8ec","block_type":"box","text":"The expense ratios of the Funds investing significantly in foreign securities can be expected to be","page_number":383,"box":{"x":116,"y":614,"width":728,"height":12}},{"id":"460829bc-1972-4d84-af22-cb7f99e0c13a","block_type":"box","text":"higher than those of Funds investing primarily in domestic securities. The costs attributable to investing","page_number":383,"box":{"x":117,"y":630,"width":769,"height":12}},{"id":"18120aaf-4818-41a6-b605-9bfcca5a9125","block_type":"box","text":"abroad are usually higher for several reasons, such as the higher cost of custody of foreign securities,","page_number":383,"box":{"x":116,"y":645,"width":761,"height":12}},{"id":"80be0fe4-d349-42d3-970d-bd8d04469a70","block_type":"box","text":"higher commissions paid on comparable transactions on foreign markets and additional costs arising","page_number":383,"box":{"x":117,"y":661,"width":746,"height":12}},{"id":"f17b025d-5643-401f-8d41-39a8a1b33e3e","block_type":"box","text":"from delays in settlements of transactions involving foreign securities.","page_number":383,"box":{"x":116,"y":676,"width":515,"height":12}},{"id":"1994c60d-6ebc-449f-86b5-93a91882c553","block_type":"box","text":"Risks of Investments in Russia.","page_number":383,"box":{"x":116,"y":707,"width":232,"height":10}},{"id":"ed775bdf-349e-4538-96ec-cc23faa94766","block_type":"box","text":"A Fund may invest a portion of its assets in securities issued by","page_number":383,"box":{"x":354,"y":707,"width":473,"height":12}},{"id":"8c3bc9bf-ec95-487a-9085-74bab95f8cc4","block_type":"box","text":"companies located in Russia. The Russian securities market suffers from a variety of problems","page_number":383,"box":{"x":116,"y":723,"width":704,"height":12}},{"id":"ddae9bdd-0abd-458f-a4d8-b2991df5158d","block_type":"box","text":"described above in “Investment in Emerging Markets” not encountered in more developed markets.","page_number":383,"box":{"x":116,"y":738,"width":736,"height":12}},{"id":"3384e114-4287-4c65-a418-6dd1025830f2","block_type":"box","text":"The Russian securities market is relatively new, and a substantial portion of securities transactions in","page_number":383,"box":{"x":116,"y":754,"width":749,"height":12}},{"id":"6025713c-c593-42ae-9ff5-a61e7d8b26a9","block_type":"box","text":"Russia are privately negotiated outside of stock exchanges. The inexperience of the Russian securities","page_number":383,"box":{"x":117,"y":769,"width":763,"height":12}},{"id":"9aa32b12-945a-4a58-bc20-5e4e82004a7a","block_type":"box","text":"market and the limited volume of trading in securities in the market may make obtaining accurate","page_number":383,"box":{"x":117,"y":785,"width":718,"height":12}},{"id":"64592cec-6c01-4b6a-b2f4-59f637f433ae","block_type":"box","text":"prices on portfolio securities from independent sources more difficult than in more developed markets.","page_number":383,"box":{"x":117,"y":800,"width":755,"height":12}},{"id":"e409abec-3b49-4786-ab5b-30753ac0bc2e","block_type":"box","text":"Because of the underdeveloped state of Russia’s securities markets and banking and","page_number":383,"box":{"x":117,"y":831,"width":639,"height":12}},{"id":"d41faf71-3857-4f6e-b4cc-65346c549c9b","block_type":"box","text":"telecommunication systems, settlement, clearing and registration of securities transactions are subject","page_number":383,"box":{"x":116,"y":847,"width":764,"height":12}},{"id":"1d72b7e2-0760-458a-9d31-6320e606788d","block_type":"box","text":"to additional risks. Prior to 2013, there was no central registration system for equity share registration","page_number":383,"box":{"x":116,"y":862,"width":756,"height":12}},{"id":"b52d640e-c8fa-4324-bb64-fe7020941cc0","block_type":"box","text":"in Russia and registration was carried out either by the issuers themselves or by registrars located","page_number":383,"box":{"x":117,"y":878,"width":733,"height":12}},{"id":"b34f8543-b04f-4e56-a4b8-87a5529c04f3","block_type":"box","text":"II-51","page_number":383,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"d0e38fc7-ae21-4604-91b1-128701052c4a","block_type":"box","text":"NM1026U-6004382-383/605","page_number":383,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"560e5b4c-ead0-45ac-8094-2b191df661b2","block_type":"box","text":"throughout Russia. These registrars may not have been subject to effective state supervision or","page_number":384,"box":{"x":116,"y":87,"width":715,"height":12}},{"id":"90e5e533-a277-400a-b504-a63c849dfa77","block_type":"box","text":"licensed with any governmental entity. In 2013, Russia established the National Settlement Depository","page_number":384,"box":{"x":117,"y":102,"width":764,"height":13}},{"id":"e8268e28-984a-456a-bcf1-8ce86872d49a","block_type":"box","text":"(“NSD”) as a recognized central securities depository, and title to Russian equities held through the","page_number":384,"box":{"x":117,"y":118,"width":740,"height":12}},{"id":"2802484f-5faf-49fe-acf2-57fcd2c4f2ac","block_type":"box","text":"NSD is now based on the records of the NSD and not on the records of the local registrars. Although","page_number":384,"box":{"x":117,"y":134,"width":751,"height":12}},{"id":"95dda217-fbc4-4b55-bff6-400164835721","block_type":"box","text":"the implementation of the NSD has enhanced the efficiency and transparency of the Russian securities","page_number":384,"box":{"x":116,"y":149,"width":770,"height":12}},{"id":"27a817a4-a3f6-49e7-bd8d-1c6a89dbc7c9","block_type":"box","text":"market, loss still can occur. Additionally, issuers and registrars remain prominent in the validation and","page_number":384,"box":{"x":117,"y":165,"width":757,"height":12}},{"id":"5d3f9fdf-a2b5-4d8e-9a7f-41ec5923d284","block_type":"box","text":"approval of documentation requirements for corporate action processing in Russia, and, because the","page_number":384,"box":{"x":116,"y":180,"width":754,"height":12}},{"id":"a2f511c0-70a9-43a4-9d71-521836947828","block_type":"box","text":"documentation requirements and approval criteria vary between registrars and issuers, there remain","page_number":384,"box":{"x":116,"y":196,"width":749,"height":12}},{"id":"3ba12b05-8597-4cf8-9cb3-9a4fb7961655","block_type":"box","text":"inconsistent market standards in the Russian market with respect to the completion and submission of","page_number":384,"box":{"x":117,"y":211,"width":762,"height":12}},{"id":"d70fbdb3-d830-4ded-b4d7-fd8eabe2beba","block_type":"box","text":"corporate action elections. To the extent that a Fund suffers a loss relating to title or corporate actions","page_number":384,"box":{"x":116,"y":227,"width":761,"height":12}},{"id":"b7e33e0a-73ba-448a-b2e9-e58d071d2c28","block_type":"box","text":"relating to its portfolio securities, it may be difficult for the Fund to enforce its rights or otherwise","page_number":384,"box":{"x":117,"y":242,"width":713,"height":12}},{"id":"9dcd4c8b-48f0-418e-ada6-2cc278469deb","block_type":"box","text":"remedy the loss. Russian securities laws may not recognize foreign nominee accounts held with a","page_number":384,"box":{"x":117,"y":258,"width":731,"height":12}},{"id":"3d10c5a2-b2cd-4fb9-b266-29b21de8d0b1","block_type":"box","text":"custodian bank, and as a result the custodian may be considered the ultimate owner of securities held","page_number":384,"box":{"x":116,"y":273,"width":762,"height":12}},{"id":"37a6da83-7d75-4161-b48d-c014599ec115","block_type":"box","text":"on behalf of their clients. A Fund also may experience difficulty in obtaining and/or enforcing judgments","page_number":384,"box":{"x":116,"y":289,"width":770,"height":12}},{"id":"d60980c6-b19e-48c3-a621-b8dc7a002d16","block_type":"box","text":"in Russia.","page_number":384,"box":{"x":117,"y":304,"width":77,"height":10}},{"id":"8f4c7a7d-f7fe-45f7-a68b-863163798a91","block_type":"box","text":"In addition, Russia continues to assert its influence in the region through economic and military","page_number":384,"box":{"x":117,"y":335,"width":708,"height":12}},{"id":"b41ea896-5faa-461e-8e2a-29ee3050a3d0","block_type":"box","text":"measures, as it did with Georgia in the summer of 2008 and the Ukraine in 2014 and 2022. Russia","page_number":384,"box":{"x":117,"y":351,"width":735,"height":12}},{"id":"aa5c1bb5-7625-412f-93d9-9ba84e47e67a","block_type":"box","text":"launched a large-scale invasion of Ukraine on February 24, 2022. The extent and duration of the","page_number":384,"box":{"x":117,"y":366,"width":720,"height":12}},{"id":"80fd4e8b-7ded-49c4-a8f7-1cc1fea471ee","block_type":"box","text":"military action, resulting sanctions and resulting future market disruptions, including declines in its","page_number":384,"box":{"x":117,"y":382,"width":727,"height":12}},{"id":"4db72461-2bf5-4f9a-b1f5-c5b2e800e7de","block_type":"box","text":"stock markets and the value of the ruble against the U.S. dollar, are impossible to predict. Any such","page_number":384,"box":{"x":116,"y":397,"width":744,"height":12}},{"id":"ac7d250e-919d-4164-8674-50a4df47a5f2","block_type":"box","text":"disruptions caused by Russian military action or other actions (including cyberattacks and espionage)","page_number":384,"box":{"x":116,"y":413,"width":757,"height":12}},{"id":"9b4ec0e1-7180-49f0-a7c4-eb7cb098731a","block_type":"box","text":"or resulting actual and threatened responses to such activity, including purchasing and financing","page_number":384,"box":{"x":116,"y":428,"width":720,"height":12}},{"id":"781751ba-dc2b-4134-967a-0fb9cf5f5d0e","block_type":"box","text":"restrictions, boycotts or changes in consumer or purchaser preferences, sanctions, tariffs or","page_number":384,"box":{"x":117,"y":444,"width":685,"height":12}},{"id":"8b189357-a526-4fb2-9ccf-f05798f7d488","block_type":"box","text":"cyberattacks on the Russian government, Russian companies or Russian individuals, including","page_number":384,"box":{"x":116,"y":459,"width":710,"height":12}},{"id":"1a2522dd-6748-4dd2-832f-02b57f159d89","block_type":"box","text":"politicians, may impact Russia’s economy and Russian issuers of securities in which the Fund invests.","page_number":384,"box":{"x":117,"y":475,"width":763,"height":12}},{"id":"339207aa-5076-408d-8c26-8027d8c92be4","block_type":"box","text":"Actual and threatened responses to such activity, including purchasing restrictions, sanctions, tariffs or","page_number":384,"box":{"x":116,"y":490,"width":766,"height":12}},{"id":"1bd47000-a5ae-43b2-81dd-0cd78d78a072","block_type":"box","text":"cyberattacks on the Russian government or Russian companies, may impact Russia’s economy and","page_number":384,"box":{"x":116,"y":506,"width":750,"height":12}},{"id":"80665e6a-488c-454b-b411-49a7d7f1f615","block_type":"box","text":"Russian issuers of securities in which the Fund invests. Actual and threatened responses to such","page_number":384,"box":{"x":117,"y":521,"width":726,"height":12}},{"id":"1aac1443-2e13-46f0-a3d0-e8b13c3e0a4f","block_type":"box","text":"military action may also impact the markets for certain Russian commodities, such as oil and natural","page_number":384,"box":{"x":117,"y":537,"width":747,"height":12}},{"id":"4ba34548-3f53-4ad4-a84f-58f71ec5d9e2","block_type":"box","text":"gas, as well as other sectors of the Russian economy, and may likely have collateral impacts on such","page_number":384,"box":{"x":116,"y":552,"width":758,"height":12}},{"id":"9dddb716-7577-48b8-8722-5f7d7d1f71ca","block_type":"box","text":"sectors globally.","page_number":384,"box":{"x":116,"y":568,"width":125,"height":12}},{"id":"c04ddc0e-80cd-4829-9dbd-a6cc43c952c0","block_type":"box","text":"Governments in the United States and many other countries (collectively, the “Sanctioning Bodies”)","page_number":384,"box":{"x":117,"y":599,"width":741,"height":12}},{"id":"57174200-91db-4242-afdb-7f0a70f9523a","block_type":"box","text":"have imposed economic sanctions, which can consist of prohibiting certain securities trades, certain","page_number":384,"box":{"x":117,"y":614,"width":745,"height":12}},{"id":"18dbd062-f012-4f7e-8b89-f9a5c38c0f6a","block_type":"box","text":"private transactions in the energy sector, asset freezes and prohibition of all business, against certain","page_number":384,"box":{"x":117,"y":630,"width":757,"height":12}},{"id":"6f6fcd5c-48f1-4c4a-a509-3109fc2130e2","block_type":"box","text":"Russian individuals, including politicians, and Russian corporate and banking entities. The Sanctioning","page_number":384,"box":{"x":117,"y":645,"width":765,"height":12}},{"id":"8cf0024f-1280-478b-871b-e7f199b830a0","block_type":"box","text":"Bodies, or others, could also institute broader sanctions on Russia, including banning Russia from","page_number":384,"box":{"x":117,"y":661,"width":725,"height":12}},{"id":"c29f2723-5c07-4e4e-bd78-dba2c3b661d1","block_type":"box","text":"global payments systems that facilitate cross-border payments. These sanctions, or even the threat of","page_number":384,"box":{"x":116,"y":676,"width":758,"height":12}},{"id":"0e7d51e7-155a-4e58-94c6-1b2b084cd304","block_type":"box","text":"further sanctions, may result in the decline of the value and liquidity of Russian securities, a weakening","page_number":384,"box":{"x":116,"y":692,"width":763,"height":12}},{"id":"f354ff9a-3bee-43d2-9349-22a9fa02e596","block_type":"box","text":"of the ruble or other adverse consequences to the Russian economy. These sanctions have resulted","page_number":384,"box":{"x":116,"y":707,"width":746,"height":12}},{"id":"661c008e-85aa-4a09-b363-0479e6ff96e5","block_type":"box","text":"and may continue to result in the immediate freeze of Russian securities and/or funds invested in","page_number":384,"box":{"x":116,"y":723,"width":719,"height":12}},{"id":"3518fc69-b5d6-4226-9c4d-0413a87f9978","block_type":"box","text":"prohibited assets, impairing the ability of a Fund to buy, sell, receive or deliver those securities and/or","page_number":384,"box":{"x":117,"y":738,"width":752,"height":12}},{"id":"99f3a761-4450-4ba1-ae6d-90ed193ab45a","block_type":"box","text":"assets. Sanctions could also result in Russia taking counter measures or retaliatory actions which may","page_number":384,"box":{"x":116,"y":754,"width":761,"height":12}},{"id":"cdc1baf7-5e16-4283-98d8-14c191da1fff","block_type":"box","text":"further impair the value and liquidity of Russian securities.","page_number":384,"box":{"x":116,"y":769,"width":428,"height":12}},{"id":"c4dcc611-734c-4303-a3cc-d02c0064d0e5","block_type":"box","text":"Risks of Investing in Saudi Arabia.","page_number":384,"box":{"x":116,"y":800,"width":253,"height":12}},{"id":"d0bb5753-bf99-4906-8f1a-a083d2ed0769","block_type":"box","text":"The ability of foreign investors (such as a Fund) to invest in Saudi","page_number":384,"box":{"x":376,"y":800,"width":486,"height":12}},{"id":"112729dd-3338-47b0-afcb-bcef6a89cc9a","block_type":"box","text":"Arabian issuers is new and untested. Such ability could be restricted or revoked by the Saudi Arabian","page_number":384,"box":{"x":116,"y":816,"width":752,"height":12}},{"id":"ed427585-efef-40c4-86c0-ddcb6819d63f","block_type":"box","text":"government at any time, and unforeseen risks could materialize due to foreign ownership in such","page_number":384,"box":{"x":116,"y":831,"width":724,"height":12}},{"id":"a276e0b8-9db8-4c4f-b2a3-7d9342a3cf06","block_type":"box","text":"securities. In addition, the Capital Market Authority (“CMA”) places investment limitations on the","page_number":384,"box":{"x":116,"y":847,"width":715,"height":12}},{"id":"72789085-b246-4abd-bba0-cea7d2ad137d","block_type":"box","text":"ownership of Saudi Arabian issuers by foreign investors, including a limitation on a Fund’s ownership","page_number":384,"box":{"x":116,"y":862,"width":753,"height":12}},{"id":"fda833c1-56f4-4608-b28e-fa90669028de","block_type":"box","text":"of any single issuer listed on the Saudi Arabian Stock Exchange, which may prevent a Fund from","page_number":384,"box":{"x":116,"y":878,"width":726,"height":12}},{"id":"68a681af-71d1-4ac8-a892-6c7d54a5854a","block_type":"box","text":"II-52","page_number":384,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"7582ecd7-4b52-4a0b-b87d-f786cd564ce0","block_type":"box","text":"NM1026U-6004382-384/605","page_number":384,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"936c72b3-c51e-4607-953b-598baba755f6","block_type":"box","text":"investing in accordance with its strategy and contribute to tracking error against the Underlying Index.","page_number":385,"box":{"x":117,"y":87,"width":757,"height":12}},{"id":"873ba63f-9e76-42ae-bc1d-b903929a9827","block_type":"box","text":"These restrictions may be changed or new restrictions, such as licensing requirements, special","page_number":385,"box":{"x":116,"y":103,"width":710,"height":12}},{"id":"3cbb7f3a-21e9-4b52-b97c-a7540f4cc736","block_type":"box","text":"approvals or additional foreign taxes, may be instituted at any time. A Fund may not be able to obtain","page_number":385,"box":{"x":116,"y":118,"width":756,"height":12}},{"id":"d35ea474-49ef-4bdf-8202-f1c5a5621db4","block_type":"box","text":"or maintain any such licenses or approvals and may not be able to buy and sell securities at full value.","page_number":385,"box":{"x":116,"y":134,"width":763,"height":12}},{"id":"bdd3cd6e-d73d-4c55-9a2a-7487e962a250","block_type":"box","text":"Major disruptions or regulatory changes could occur in the Saudi Arabian market, any of which could","page_number":385,"box":{"x":117,"y":149,"width":750,"height":12}},{"id":"cc0bc872-16a6-4528-802d-5030eec44b61","block_type":"box","text":"negatively impact a Fund. These risks may be exacerbated, compared to more developed markets,","page_number":385,"box":{"x":117,"y":165,"width":741,"height":12}},{"id":"9da65324-5308-441d-8bf9-0116959a4f31","block_type":"box","text":"given the limited history of foreign investment in the Saudi Arabian market. Investments in Saudi","page_number":385,"box":{"x":116,"y":180,"width":719,"height":12}},{"id":"a6a59631-e221-459c-af90-4e60d7212755","block_type":"box","text":"Arabia may also be subject to loss due to expropriation or nationalization of assets and property or the","page_number":385,"box":{"x":116,"y":196,"width":764,"height":12}},{"id":"d44af168-d2d4-4e64-a30a-cf04973b1660","block_type":"box","text":"imposition of restrictions on additional foreign investments and repatriation of capital. Such heightened","page_number":385,"box":{"x":117,"y":211,"width":764,"height":12}},{"id":"cbdecf9e-ec32-4ef3-a984-597129cf71b9","block_type":"box","text":"risks may include, among others, restrictions on and government intervention in international trade,","page_number":385,"box":{"x":117,"y":227,"width":739,"height":12}},{"id":"62542526-0392-44c7-acbb-cc249e2adba7","block_type":"box","text":"confiscatory taxation, political instability, including authoritarian and/or military involvement in","page_number":385,"box":{"x":116,"y":242,"width":694,"height":12}},{"id":"cb00bf9f-c49c-48e2-9a3d-a4f95d419a9c","block_type":"box","text":"governmental decision making, armed conflict, crime and instability as a result of religious, ethnic and/","page_number":385,"box":{"x":116,"y":258,"width":758,"height":12}},{"id":"6d6af575-276c-440a-b70a-6947d1e5f996","block_type":"box","text":"or socioeconomic unrest. Saudi Arabia has privatized, or has begun the process of privatizing, certain","page_number":385,"box":{"x":116,"y":273,"width":759,"height":12}},{"id":"e3281b2b-e176-4890-96d4-83cc3cfaa926","block_type":"box","text":"entities and industries. Newly privatized companies may face strong competition from government","page_number":385,"box":{"x":116,"y":289,"width":733,"height":12}},{"id":"28ae9cbe-d0c9-4940-8909-69be55072ad4","block_type":"box","text":"sponsored competitors that have not been privatized. In some instances, investors in newly privatized","page_number":385,"box":{"x":116,"y":304,"width":760,"height":12}},{"id":"31053b4e-8467-419d-99f4-edb6a624d383","block_type":"box","text":"entities have suffered losses due to the inability of the newly privatized entities to adjust quickly to a","page_number":385,"box":{"x":116,"y":320,"width":744,"height":12}},{"id":"919acec4-4bc6-49d5-bfb5-f06bcd62c8be","block_type":"box","text":"competitive environment or changing regulatory and legal standards or, in some cases, due to","page_number":385,"box":{"x":116,"y":335,"width":703,"height":12}},{"id":"a92a77c2-b8c7-4633-9fc0-a66c90fa00dd","block_type":"box","text":"re-nationalization of such privatized entities. There is no assurance that similar losses will not recur.","page_number":385,"box":{"x":117,"y":351,"width":743,"height":12}},{"id":"f5311b37-8261-43c8-9036-6bedbfb983c3","block_type":"box","text":"Further, under income tax laws imposed by the Department of Zakat and Income Tax, dividends paid","page_number":385,"box":{"x":117,"y":366,"width":754,"height":12}},{"id":"596bd64f-3a98-455d-85eb-a5bb6b0fd827","block_type":"box","text":"by a Saudi Arabian company to foreign stockholders are generally subject to a 5% withholding tax","page_number":385,"box":{"x":117,"y":382,"width":730,"height":12}},{"id":"a4c22287-a667-4787-ab36-7cb720e56603","block_type":"box","text":"(different tax rates may apply pursuant to an applicable treaty). Saudi Arabia is highly reliant on income","page_number":385,"box":{"x":117,"y":397,"width":770,"height":12}},{"id":"ebd2a36e-8243-4428-a30f-0cc23ff8a7b5","block_type":"box","text":"from the sale of petroleum and trade with other countries involved in the sale of petroleum, and its","page_number":385,"box":{"x":116,"y":413,"width":732,"height":12}},{"id":"a9c81509-c5cb-4a6b-8286-2bab9194f91b","block_type":"box","text":"economy is therefore vulnerable to changes in foreign currency values and the market for petroleum.","page_number":385,"box":{"x":116,"y":428,"width":753,"height":12}},{"id":"7f43711f-af4c-4604-b78d-a07a9c1ed7f3","block_type":"box","text":"As global demand for petroleum fluctuates, Saudi Arabia may be significantly impacted.","page_number":385,"box":{"x":116,"y":444,"width":655,"height":12}},{"id":"41462320-d03c-4b0e-a708-be88a929f087","block_type":"box","text":"Like most Middle Eastern governments, the government of Saudi Arabia exercises substantial","page_number":385,"box":{"x":117,"y":475,"width":701,"height":12}},{"id":"abe098bc-5176-4f1c-a6c4-37086367236c","block_type":"box","text":"influence over many aspects of the private sector. Although liberalization in the wider economy is","page_number":385,"box":{"x":117,"y":490,"width":724,"height":12}},{"id":"6a79ac78-67a4-49de-a923-9f0d6cddaedc","block_type":"box","text":"underway, in many areas it has lagged significantly: restrictions on foreign ownership persist, and the","page_number":385,"box":{"x":117,"y":506,"width":755,"height":12}},{"id":"e28dbb63-64a5-4c77-9fc8-afddfed64cab","block_type":"box","text":"government has an ownership stake in many key industries. The situation is exacerbated by the fact","page_number":385,"box":{"x":116,"y":521,"width":748,"height":12}},{"id":"5cc5a152-c2cf-49d6-8768-152093735844","block_type":"box","text":"that Saudi Arabia is governed by an absolute monarchy. Saudi Arabia has historically experienced","page_number":385,"box":{"x":116,"y":537,"width":735,"height":12}},{"id":"c14ecf83-208c-49b6-99d2-164e904541df","block_type":"box","text":"strained relations with economic partners worldwide, including other countries in the Middle East due to","page_number":385,"box":{"x":116,"y":552,"width":771,"height":12}},{"id":"47a67976-c136-45f4-9d2c-7a1e775a9522","block_type":"box","text":"geopolitical events. Incidents involving a Middle Eastern country’s or the region’s security, including","page_number":385,"box":{"x":116,"y":568,"width":742,"height":12}},{"id":"8104fb84-3b85-40d2-beb7-34c9d1c28d70","block_type":"box","text":"terrorism, may cause uncertainty in their markets and may adversely affect its economy and a Fund’s","page_number":385,"box":{"x":116,"y":583,"width":757,"height":12}},{"id":"9cd9d341-902a-4701-b52f-5a446d84200e","block_type":"box","text":"investments. Governmental actions in the future could have a significant effect on economic conditions","page_number":385,"box":{"x":117,"y":599,"width":766,"height":12}},{"id":"dfb24ea5-8bcb-480f-af2d-7cba92898b69","block_type":"box","text":"in Saudi Arabia, which could affect private sector companies and a Fund, as well as the value of","page_number":385,"box":{"x":117,"y":614,"width":717,"height":12}},{"id":"f740b276-f02a-407a-87bc-3f18b31e929b","block_type":"box","text":"securities in a Fund’s portfolio. Any economic sanctions on Saudi Arabian individuals or Saudi Arabian","page_number":385,"box":{"x":116,"y":630,"width":765,"height":12}},{"id":"9558834e-2174-4163-9d64-ef1602b1a341","block_type":"box","text":"corporate entities, or even the threat of sanctions, may result in the decline of the value and liquidity of","page_number":385,"box":{"x":116,"y":645,"width":764,"height":12}},{"id":"e717b1d0-1c4d-4b18-8861-2057e50655c6","block_type":"box","text":"Saudi Arabian securities, a weakening of the Saudi riyal or other adverse consequences to the Saudi","page_number":385,"box":{"x":116,"y":661,"width":749,"height":12}},{"id":"60c4642b-4431-4754-a4cd-0c089deadf1e","block_type":"box","text":"Arabian economy. In addition, Saudi Arabia’s economy relies heavily on cheap, foreign labor, and","page_number":385,"box":{"x":116,"y":676,"width":723,"height":12}},{"id":"c3490074-d43a-432f-8543-948b522af982","block_type":"box","text":"changes in the availability of this labor supply could have an adverse effect on the economy.","page_number":385,"box":{"x":116,"y":692,"width":684,"height":12}},{"id":"43353213-5be0-48d0-b36e-2188402f0998","block_type":"box","text":"The securities markets in Saudi Arabia may not be as developed as those in other countries. As a","page_number":385,"box":{"x":116,"y":723,"width":725,"height":12}},{"id":"075df806-6309-49c0-9e6c-1093e23f35fa","block_type":"box","text":"result, securities markets in Saudi Arabia are subject to greater risks associated with market volatility,","page_number":385,"box":{"x":117,"y":738,"width":751,"height":12}},{"id":"567bf586-0bb8-4c29-bbe0-d10b0a5da34e","block_type":"box","text":"lower market capitalization, lower trading volume, illiquidity, inflation, greater price fluctuations,","page_number":385,"box":{"x":117,"y":754,"width":699,"height":12}},{"id":"5804f83e-02d3-4e1e-b623-c4a6fa8049b4","block_type":"box","text":"uncertainty regarding the existence of trading markets, governmental control and heavy regulation of","page_number":385,"box":{"x":117,"y":769,"width":747,"height":12}},{"id":"91dc5a94-f1b9-499f-9aaf-d010c00f3cc6","block_type":"box","text":"labor and industry. Shares of certain Saudi Arabian companies tend to trade less frequently than those","page_number":385,"box":{"x":117,"y":785,"width":761,"height":12}},{"id":"53566bee-98ec-4cb2-abd7-8f7b3f415ce5","block_type":"box","text":"of companies on exchanges in more developed markets. Such infrequent trading may adversely affect","page_number":385,"box":{"x":116,"y":800,"width":759,"height":12}},{"id":"63e097c7-010c-4520-8053-49e32df2a0a8","block_type":"box","text":"the pricing of these securities and a Fund’s ability to sell these securities in the future. Current","page_number":385,"box":{"x":116,"y":816,"width":697,"height":12}},{"id":"c525f44c-71a9-4926-94f7-f6854b36705d","block_type":"box","text":"regulations in Saudi Arabian markets may require a Fund to execute trades of securities through a","page_number":385,"box":{"x":117,"y":831,"width":733,"height":12}},{"id":"72550245-5318-42b0-8344-b80d8b060386","block_type":"box","text":"single broker. As a result, the Manager will have less flexibility to choose among brokers on behalf of a","page_number":385,"box":{"x":116,"y":847,"width":767,"height":12}},{"id":"c5143fe2-ed77-4e57-abcc-41494a1e4cfc","block_type":"box","text":"Fund than is typically the case for investment managers.","page_number":385,"box":{"x":117,"y":862,"width":424,"height":12}},{"id":"eecd1696-84e2-4c46-81ab-c941cfb96564","block_type":"box","text":"II-53","page_number":385,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"a8d099cc-9fd2-4e1e-8bb3-6353c6664baa","block_type":"box","text":"NM1026U-6004382-385/605","page_number":385,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"52933a28-2333-4808-b127-50a0092db662","block_type":"box","text":"Although the political situation in Saudi Arabia is largely stable, Saudi Arabia has historically","page_number":386,"box":{"x":116,"y":87,"width":687,"height":12}},{"id":"ce24a4e9-82bc-4894-a171-4c19f85a2dc2","block_type":"box","text":"experienced political instability, and there remains the possibility that the stability will not hold in the","page_number":386,"box":{"x":116,"y":103,"width":741,"height":12}},{"id":"3aba22bb-2842-42c5-a9f2-0fd42b121a51","block_type":"box","text":"future or that instability in the larger Middle East region could adversely impact the economy of Saudi","page_number":386,"box":{"x":116,"y":118,"width":755,"height":12}},{"id":"fe1faca8-660c-460c-be61-c7a1a3df000d","block_type":"box","text":"Arabia. Instability may be caused by military developments, government interventions in the","page_number":386,"box":{"x":116,"y":134,"width":686,"height":12}},{"id":"9210cab3-315f-4add-a56a-858d89ae843a","block_type":"box","text":"marketplace, terrorism, extremist attitudes, attempted social or political reforms, religious differences,","page_number":386,"box":{"x":117,"y":149,"width":755,"height":12}},{"id":"685351be-d985-472e-a11c-015a5d48bfc0","block_type":"box","text":"or other factors. Additionally, anti-Western views held by certain groups in the Middle East may","page_number":386,"box":{"x":116,"y":165,"width":710,"height":12}},{"id":"41ba7aff-f015-4fca-95ce-4a16f22ca5b1","block_type":"box","text":"influence government policies regarding foreign investment. Further developments in U.S. relations","page_number":386,"box":{"x":117,"y":180,"width":740,"height":12}},{"id":"c21e06c6-1554-41d9-9a96-ea1851169b3e","block_type":"box","text":"with Saudi Arabia and other Middle-Eastern countries may affect these attitudes and policies. The U.S.","page_number":386,"box":{"x":116,"y":196,"width":768,"height":12}},{"id":"557e7ee5-da5d-43e7-9473-f335a6a4360b","block_type":"box","text":"is a significant, and in some cases the most significant, trading partner of, or foreign investor in, Saudi","page_number":386,"box":{"x":117,"y":211,"width":760,"height":12}},{"id":"9c77122e-46f2-4fe9-a79c-c52f15a0ce59","block_type":"box","text":"Arabia. As a result, economic conditions of Saudi Arabia may be particularly affected by changes in the","page_number":386,"box":{"x":116,"y":227,"width":771,"height":12}},{"id":"297e7b99-a01b-4ef5-958d-ef46b8918f7a","block_type":"box","text":"U.S. economy. A decrease in U.S. imports or exports, new trade and financial regulations or tariffs,","page_number":386,"box":{"x":117,"y":242,"width":738,"height":12}},{"id":"718f21c3-4783-4522-ad86-53475cdcff81","block_type":"box","text":"changes in the U.S. dollar exchange rate or an economic slowdown in the U.S. may have a material","page_number":386,"box":{"x":116,"y":258,"width":746,"height":12}},{"id":"baa30f8b-122a-4865-baa3-14b1beb67c01","block_type":"box","text":"adverse effect on the economic conditions of Saudi Arabia and, as a result, securities to which the","page_number":386,"box":{"x":116,"y":273,"width":733,"height":11}},{"id":"e0a0e371-8cfc-4b14-9139-aef5f4273f3c","block_type":"box","text":"Fund has exposure. Political instability in North Africa and the larger Middle East region has caused","page_number":386,"box":{"x":117,"y":289,"width":743,"height":12}},{"id":"317ca5ff-ff74-432f-9712-5096580e4147","block_type":"box","text":"significant disruptions to many industries. Continued political and social unrest in these areas may","page_number":386,"box":{"x":116,"y":304,"width":732,"height":12}},{"id":"957fbc9a-6e82-4969-a538-5a6a324aa138","block_type":"box","text":"negatively affect the value of securities in a Fund’s portfolio.","page_number":386,"box":{"x":117,"y":320,"width":449,"height":12}},{"id":"3e0e21e4-b108-4f8e-8293-40a3e3a072fe","block_type":"box","text":"Certain issuers located in Saudi Arabia may operate in, or have dealings with, countries subject to","page_number":386,"box":{"x":117,"y":351,"width":731,"height":12}},{"id":"1bdcbee9-a9a9-408a-8293-6fdfc3b739d2","block_type":"box","text":"sanctions and/or embargoes imposed by the U.S. Government and the United Nations and/or countries","page_number":386,"box":{"x":116,"y":366,"width":772,"height":12}},{"id":"412c327c-60ef-4ac2-b6bd-c856d4554e8f","block_type":"box","text":"identified by the U.S. Government as state sponsors of terrorism. As a result, an issuer may sustain","page_number":386,"box":{"x":117,"y":382,"width":744,"height":12}},{"id":"33ff26cf-a2b3-4b4d-a54f-b8e63beb5e3d","block_type":"box","text":"damage to its reputation if it is identified as an issuer which operates in, or has dealings with, such","page_number":386,"box":{"x":116,"y":397,"width":734,"height":12}},{"id":"7d894ebf-d6e4-484a-a8c8-ab5c072a6c6e","block_type":"box","text":"countries. A Fund, as an investor in such issuers will be indirectly subject to those risks.","page_number":386,"box":{"x":116,"y":413,"width":655,"height":12}},{"id":"7c15adb1-56ce-4151-9b5a-ef64df1ccd94","block_type":"box","text":"Risks of Investing in Venezuela.","page_number":386,"box":{"x":116,"y":444,"width":237,"height":12}},{"id":"59ca44f2-93ab-4cd2-8e1e-1900037000af","block_type":"box","text":"Investment in Venezuela may subject a Fund to legal, regulatory,","page_number":386,"box":{"x":354,"y":444,"width":493,"height":12}},{"id":"60a24998-0e21-4d19-81cb-056f54e6bf75","block_type":"box","text":"political, currency, security, expropriation and/or nationalization of assets and economic risk specific to","page_number":386,"box":{"x":117,"y":459,"width":764,"height":12}},{"id":"20226ef8-21a1-4364-beb9-6ea70f1c2c26","block_type":"box","text":"Venezuela. Venezuela is extremely well endowed with natural resources, including oil and natural gas,","page_number":386,"box":{"x":116,"y":475,"width":765,"height":12}},{"id":"bec782ff-b937-4abf-afe8-a197e0005a9d","block_type":"box","text":"and its economy is heavily dependent on export of natural resources to key trading partners. Any act of","page_number":386,"box":{"x":116,"y":490,"width":770,"height":12}},{"id":"8319931f-824b-4849-9928-37c8df112bb4","block_type":"box","text":"terrorism, an armed conflict or a breakdown of a key trading relationship that disrupts the production or","page_number":386,"box":{"x":116,"y":506,"width":767,"height":12}},{"id":"d3896676-6058-429b-a8fc-6998d57d7cfe","block_type":"box","text":"export of natural resources will likely negatively affect the Venezuelan economy. The government","page_number":386,"box":{"x":116,"y":521,"width":727,"height":12}},{"id":"b44bc4e3-cbc8-4ec8-83a8-49910a8ad580","block_type":"box","text":"continues to control key sectors of the economy, including upstream oil and gas production, and has","page_number":386,"box":{"x":116,"y":537,"width":749,"height":12}},{"id":"ceb667d3-422a-4839-b7a3-011ff0209771","block_type":"box","text":"sought to increase its role in key sectors, such as telecommunications and steel. Meanwhile,","page_number":386,"box":{"x":116,"y":552,"width":692,"height":12}},{"id":"1ff28a2c-c733-4847-8e47-8b986fcdc2d6","block_type":"box","text":"ambiguities in the investment environment remain, such as continued high levels of bureaucracy and","page_number":386,"box":{"x":116,"y":568,"width":753,"height":12}},{"id":"6f0a2a65-cc64-4d52-81e4-fbd97992db1a","block_type":"box","text":"corruption, large macroeconomic imbalances, and political and policy uncertainty. Friction continues","page_number":386,"box":{"x":116,"y":583,"width":746,"height":12}},{"id":"d329ad04-ff68-4283-9a53-e4de4a253e6c","block_type":"box","text":"between the governments of the U.S. and Venezuela. The U.S. has imposed economic sanctions,","page_number":386,"box":{"x":117,"y":599,"width":731,"height":12}},{"id":"7091c1b1-524d-4bfe-979f-0e5d4c0f3c48","block_type":"box","text":"which consist of asset freezes and sectoral sanctions, on certain Venezuelan individuals and","page_number":386,"box":{"x":116,"y":614,"width":693,"height":11}},{"id":"8c45f0b6-6b66-434c-bbd6-a971b3384eac","block_type":"box","text":"Venezuelan corporate entities, and on the Venezuelan government. The U.S. could also institute","page_number":386,"box":{"x":116,"y":630,"width":722,"height":12}},{"id":"31f60ff7-5ccb-4e5e-90b1-9d53c469ae80","block_type":"box","text":"broader sanctions on Venezuela. The U.S. has also taken military action against Venezuela in an effort","page_number":386,"box":{"x":117,"y":645,"width":769,"height":12}},{"id":"d4b1d1a6-e444-4f23-ad64-46346f305272","block_type":"box","text":"to effect regime change. Military action, sanctions, or even the threat of further military action and","page_number":386,"box":{"x":116,"y":661,"width":721,"height":12}},{"id":"e082df7d-9745-495a-9789-c3a7d83a17d4","block_type":"box","text":"sanctions, may result in the decline of the value and liquidity of Venezuelan securities, a weakening of","page_number":386,"box":{"x":116,"y":676,"width":758,"height":12}},{"id":"ea4b963d-0f0c-43b7-88d2-47517a3ce4cb","block_type":"box","text":"the bolivar or other adverse consequences to the Venezuelan economy. These sanctions impair the","page_number":386,"box":{"x":116,"y":692,"width":741,"height":12}},{"id":"3223cb81-cf35-48cc-9677-2e85abb73695","block_type":"box","text":"ability of a Fund to buy, sell, receive or deliver those securities and/or assets. Additional sanctions","page_number":386,"box":{"x":116,"y":707,"width":727,"height":12}},{"id":"fad806c3-0fb5-4150-8252-eede41c3ec15","block_type":"box","text":"against Venezuela may in the future be imposed by the U.S. or other countries. These factors, among","page_number":386,"box":{"x":116,"y":723,"width":755,"height":12}},{"id":"0db2203b-2fe6-4ce9-ac26-c60efafa07f2","block_type":"box","text":"others, can have a negative impact on a Fund’s investments.","page_number":386,"box":{"x":116,"y":738,"width":451,"height":12}},{"id":"e1695640-af83-4081-aac5-185f3d4ec1b8","block_type":"box","text":"Brady Bonds.","page_number":386,"box":{"x":116,"y":769,"width":99,"height":12}},{"id":"7bc00322-ef9a-4bc9-aba5-a933857828a1","block_type":"box","text":"Certain Funds may invest in Brady Bonds. A Fund’s emerging market debt securities","page_number":386,"box":{"x":222,"y":769,"width":628,"height":12}},{"id":"6f5b6139-43c4-4df8-bde2-be931848400a","block_type":"box","text":"may include emerging market governmental debt obligations commonly referred to as Brady Bonds.","page_number":386,"box":{"x":117,"y":785,"width":739,"height":12}},{"id":"b56bb42c-a38f-4477-a66d-e145ea694568","block_type":"box","text":"Brady Bonds are securities created through the exchange of existing commercial bank loans to","page_number":386,"box":{"x":117,"y":800,"width":704,"height":12}},{"id":"6e97b4a7-63aa-441a-b155-bc29f35436cf","block_type":"box","text":"sovereign entities for new obligations in connection with debt restructurings under a debt restructuring","page_number":386,"box":{"x":116,"y":816,"width":755,"height":12}},{"id":"1a7e8e92-3ca6-46ac-97eb-ad5f2bb0a89f","block_type":"box","text":"plan introduced by former U.S. Secretary of the Treasury, Nicholas F. Brady (the “Brady Plan”). Brady","page_number":386,"box":{"x":117,"y":831,"width":760,"height":12}},{"id":"a6bd51f1-c528-4aa8-8ac6-d7a5ddd20d6a","block_type":"box","text":"Plan debt restructurings have been implemented in a number of countries, including: Argentina,","page_number":386,"box":{"x":117,"y":847,"width":713,"height":12}},{"id":"0e6496a4-5646-41ea-896c-9965a0d00161","block_type":"box","text":"Bolivia, Brazil, Bulgaria, Costa Rica, the Dominican Republic, Ecuador, Jordan, Mexico, Niger, Nigeria,","page_number":386,"box":{"x":117,"y":862,"width":766,"height":12}},{"id":"8ca46f90-df72-4030-b854-414d3bbf31d1","block_type":"box","text":"Panama, Peru, the Philippines, Poland, Uruguay, Venezuela, and Vietnam. Beginning in the early","page_number":386,"box":{"x":117,"y":878,"width":728,"height":12}},{"id":"a6631409-b1d2-4ffa-9579-5255dd93a119","block_type":"box","text":"II-54","page_number":386,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"ac494c26-138f-40c7-9867-3a33a04b82e6","block_type":"box","text":"NM1026U-6004382-386/605","page_number":386,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"edc87d70-2647-4448-9184-8759f30e5133","block_type":"box","text":"2000s, certain countries began retiring their Brady Bonds, including Brazil, Colombia, Mexico, the","page_number":387,"box":{"x":116,"y":87,"width":727,"height":12}},{"id":"bb488000-ffa4-4756-a469-7ac758658fc2","block_type":"box","text":"Philippines, and Venezuela.","page_number":387,"box":{"x":117,"y":103,"width":211,"height":11}},{"id":"9511565c-109d-4c96-9313-d5b95cbab9dc","block_type":"box","text":"Brady Bonds may be collateralized or uncollateralized, are issued in various currencies (primarily the","page_number":387,"box":{"x":117,"y":135,"width":752,"height":12}},{"id":"f54ce91a-041a-43d7-8525-fbb5634ce1e5","block_type":"box","text":"U.S. dollar) and are actively traded in the OTC secondary market. Brady Bonds are not considered to","page_number":387,"box":{"x":117,"y":151,"width":756,"height":12}},{"id":"6df04ee5-a80b-4bf9-a3eb-204f55cd9936","block_type":"box","text":"be U.S. Government Securities. U.S. dollar-denominated, collateralized Brady Bonds, which may be","page_number":387,"box":{"x":117,"y":166,"width":747,"height":12}},{"id":"dd103e70-b768-4b96-8063-8ab8b84b9968","block_type":"box","text":"fixed rate par bonds or floating rate discount bonds, are generally collateralized in full as to principal by","page_number":387,"box":{"x":116,"y":182,"width":768,"height":12}},{"id":"93e08d26-4f77-46bf-b9a1-a6934d6aad34","block_type":"box","text":"U.S. Treasury zero-coupon bonds having the same maturity as the Brady Bonds. Interest payments on","page_number":387,"box":{"x":117,"y":197,"width":767,"height":12}},{"id":"47f6bd50-a472-4bc1-977e-d7c8b6a783c6","block_type":"box","text":"these Brady Bonds generally are collateralized on a one-year or longer rolling-forward basis by cash or","page_number":387,"box":{"x":116,"y":213,"width":769,"height":12}},{"id":"bb2cd4b7-ee4b-4cba-a2b2-99ee2413453c","block_type":"box","text":"securities in an amount that, in the case of fixed rate bonds, is equal to at least one year of interest","page_number":387,"box":{"x":116,"y":228,"width":738,"height":12}},{"id":"a481c891-94c8-4f30-9e14-b5257ff59c7e","block_type":"box","text":"payments or, in the case of floating rate bonds, initially is equal to at least one year’s interest payments","page_number":387,"box":{"x":117,"y":244,"width":769,"height":12}},{"id":"ccb624d0-86ed-447a-a7e6-dc028afe18f5","block_type":"box","text":"based on the applicable interest rate at that time and is adjusted at regular intervals thereafter. Certain","page_number":387,"box":{"x":117,"y":259,"width":764,"height":12}},{"id":"42e61a27-7ce6-4ba1-8665-de42820e09ae","block_type":"box","text":"Brady Bonds are entitled to “value recovery payments” in certain circumstances, which in effect","page_number":387,"box":{"x":117,"y":275,"width":711,"height":12}},{"id":"bd047474-6988-4d14-9f24-b100c27f8277","block_type":"box","text":"constitute supplemental interest payments but generally are not collateralized. Brady Bonds are often","page_number":387,"box":{"x":116,"y":290,"width":757,"height":12}},{"id":"ae34a2a0-9876-4882-8113-cdacdfad1ec0","block_type":"box","text":"viewed as having three or four valuation components: (i) the collateralized repayment of principal at","page_number":387,"box":{"x":116,"y":306,"width":743,"height":12}},{"id":"c7c0c90d-f5e8-4025-85c9-bc3311683129","block_type":"box","text":"final maturity; (ii) the collateralized interest payments; (iii) the uncollateralized interest payments; and","page_number":387,"box":{"x":116,"y":321,"width":753,"height":12}},{"id":"9e25f430-99e6-4f5c-bef7-227fd4b33f05","block_type":"box","text":"(iv) any uncollateralized repayment of principal at maturity (the uncollateralized amounts constitute the","page_number":387,"box":{"x":117,"y":337,"width":763,"height":12}},{"id":"741f9df3-5f88-4b8f-a5dd-0b6d25f25b77","block_type":"box","text":"“residual risk”).","page_number":387,"box":{"x":116,"y":352,"width":116,"height":12}},{"id":"fcc8bf1f-bf04-4048-ad79-4636e65dedeb","block_type":"box","text":"Brady Bonds involve various risk factors described abov","page_number":387,"box":{"x":117,"y":385,"width":398,"height":12}},{"id":"1ecd64ca-406c-4579-9008-a97842e5cd7a","block_type":"box","text":"e associated with investing in foreign securities,","page_number":387,"box":{"x":516,"y":385,"width":343,"height":12}},{"id":"3c090e63-854c-4d60-b647-93310cb782de","block_type":"box","text":"including the history of defaults with respect to co","page_number":387,"box":{"x":117,"y":400,"width":348,"height":13}},{"id":"1e1bd574-9238-46b8-863e-a37e1f57fe7c","block_type":"box","text":"mmercial bank loans by public and private entities of","page_number":387,"box":{"x":467,"y":400,"width":377,"height":13}},{"id":"ed957faa-b725-4391-8665-17d5e86b1e3c","block_type":"box","text":"countries issuing Brady Bonds. In light of the resi","page_number":387,"box":{"x":116,"y":416,"width":346,"height":12}},{"id":"863c8d18-7ca6-404e-8557-51615042f1bf","block_type":"box","text":"dual risk of Brady Bonds and, among other factors, the","page_number":387,"box":{"x":464,"y":416,"width":393,"height":12}},{"id":"ec39e5a9-4543-497b-8df3-df8862f1a724","block_type":"box","text":"history of defaults, investments in Brady Bonds are c","page_number":387,"box":{"x":117,"y":431,"width":373,"height":13}},{"id":"92424b75-110e-4dfc-8b5d-af8832ab8ad2","block_type":"box","text":"onsidered speculative. There can be no assurance that","page_number":387,"box":{"x":491,"y":432,"width":396,"height":11}},{"id":"53f1b888-f974-47fb-8a69-58770e4469ac","block_type":"box","text":"Brady Bonds in which the Funds may invest will not be subject to restructuring arrangements or to requests","page_number":387,"box":{"x":117,"y":447,"width":766,"height":12}},{"id":"9efa6a0e-da07-42f5-8d79-e8995b48008b","block_type":"box","text":"for new credit, which may cause the Funds to suffer a lo","page_number":387,"box":{"x":116,"y":462,"width":397,"height":13}},{"id":"b62d3664-976f-4cec-bab5-af0f057ba031","block_type":"box","text":"ss of interest or principal on any of its holdings.","page_number":387,"box":{"x":514,"y":462,"width":338,"height":13}},{"id":"92bf7b80-c71f-4934-aa24-96c997771e22","block_type":"box","text":"China Investments Risk.","page_number":387,"box":{"x":117,"y":495,"width":185,"height":10}},{"id":"6fcd955d-e06a-4357-b312-eaa9fd075d35","block_type":"box","text":"Investments in securities of companies domiciled in the People’s Republic of China (“China” or the","page_number":387,"box":{"x":117,"y":519,"width":734,"height":12}},{"id":"3a84afab-c113-47f3-b2cf-985fefd8abe6","block_type":"box","text":"“PRC”), including certain Hong Kong-listed and U.S.-listed securities, involve a high degree of risk and","page_number":387,"box":{"x":116,"y":535,"width":764,"height":12}},{"id":"6bbee2de-61b1-4cc2-bae7-680c7313223b","block_type":"box","text":"special considerations not typically associated with investing in the U.S. securities markets. Such","page_number":387,"box":{"x":116,"y":550,"width":725,"height":12}},{"id":"59181879-56ed-4b7b-8341-27cc8bcbacb8","block_type":"box","text":"heightened risks include, among others, an authoritarian government, popular unrest associated with","page_number":387,"box":{"x":117,"y":566,"width":753,"height":12}},{"id":"a383bfe7-eb78-4e9e-ad2a-0a6a8e15b247","block_type":"box","text":"demands for improved political, economic and social conditions, the impact of regional conflict on the","page_number":387,"box":{"x":116,"y":581,"width":754,"height":12}},{"id":"f8306389-fa38-463b-9c57-1f591ecd18b0","block_type":"box","text":"economy and hostile relations with other countries.","page_number":387,"box":{"x":116,"y":597,"width":382,"height":12}},{"id":"ebafd223-18ce-4fb6-a92a-53ba902440af","block_type":"box","text":"Military conflicts, either in response to internal social unrest or conflicts with other countries, could","page_number":387,"box":{"x":117,"y":629,"width":729,"height":13}},{"id":"5a9c37f7-381b-4f13-858a-53c02b87632e","block_type":"box","text":"disrupt economic development. The Chinese economy is vulnerable to the long-running disagreements","page_number":387,"box":{"x":116,"y":645,"width":769,"height":12}},{"id":"0742aefc-64d7-4390-8263-a6e66c822dc3","block_type":"box","text":"and religious and nationalist disputes with Tibet and the Xinjiang region. Since 1997, there have been","page_number":387,"box":{"x":116,"y":660,"width":752,"height":13}},{"id":"0f1bb749-a976-43fe-be27-ca05eb1b9ee9","block_type":"box","text":"tensions between the Chinese government and many people in Hong Kong who perceive China as","page_number":387,"box":{"x":116,"y":676,"width":733,"height":12}},{"id":"32612d2a-dfc1-44e7-bbfe-a0ab741727ad","block_type":"box","text":"tightening control over Hong Kong’s semi-autonomous liberal political, economic, legal, and social","page_number":387,"box":{"x":116,"y":692,"width":725,"height":12}},{"id":"1e2ad467-2cdf-47ec-9d1b-220cce63d865","block_type":"box","text":"framework. Protests and unrest have increased tensions even further. Due to the interconnected","page_number":387,"box":{"x":116,"y":707,"width":716,"height":10}},{"id":"1a673e63-4476-48d0-9c61-3abd31203b57","block_type":"box","text":"nature of the Hong Kong and Chinese economies, this instability in Hong Kong may cause uncertainty","page_number":387,"box":{"x":117,"y":722,"width":756,"height":13}},{"id":"a5359c1e-64f8-4566-8239-1b351988ff70","block_type":"box","text":"in the Hong Kong and Chinese markets. China has a complex territorial dispute regarding the","page_number":387,"box":{"x":117,"y":738,"width":691,"height":12}},{"id":"8e737972-4ec6-489e-911f-1fd9c862fa9f","block_type":"box","text":"sovereignty of Taiwan and has made threats of invasion. Taiwan-based companies and individuals are","page_number":387,"box":{"x":116,"y":753,"width":761,"height":13}},{"id":"517a36b7-d048-4a02-b9ed-faf290c83223","block_type":"box","text":"significant investors in China. The continuing hostility between China and Taiwan may have an adverse","page_number":387,"box":{"x":116,"y":769,"width":767,"height":12}},{"id":"8b1e5401-fbee-4c26-be93-0c0f2da0161f","block_type":"box","text":"impact on the value of the Fund’s investments in China or Taiwan, may cause a suspension in a","page_number":387,"box":{"x":117,"y":784,"width":712,"height":13}},{"id":"d8972cac-e870-4f4e-aa23-12bf6775d6fc","block_type":"box","text":"Fund’s ability to trade in certain securities or other assets or may otherwise make such investments","page_number":387,"box":{"x":117,"y":800,"width":736,"height":12}},{"id":"5534c462-b437-4ba2-afae-efb286b738e4","block_type":"box","text":"impracticable or impossible. Any escalation of hostility between China and Taiwan would likely have a","page_number":387,"box":{"x":117,"y":815,"width":753,"height":13}},{"id":"f8b528d2-bc75-4efb-bfb1-160993e39b7a","block_type":"box","text":"significant adverse impact on the value of the Fund’s investments in both countries and the region. In","page_number":387,"box":{"x":116,"y":831,"width":755,"height":12}},{"id":"5c8fc837-e909-4792-be18-d3aa4dc5d1ba","block_type":"box","text":"addition, China has strained international relations with Japan, India, the Philippines and other","page_number":387,"box":{"x":116,"y":846,"width":703,"height":12}},{"id":"744882c8-1ee6-4a9b-9fa3-590465f7fa8d","block_type":"box","text":"neighbors due to territorial disputes, historical animosities and other defense concerns. Frictions","page_number":387,"box":{"x":117,"y":862,"width":717,"height":12}},{"id":"6c9a83f4-7cbb-4aad-9360-d3ab987f18a8","block_type":"box","text":"between China and the Philippines in the South China Sea pose a risk of escalation potentially leading","page_number":387,"box":{"x":117,"y":877,"width":765,"height":13}},{"id":"16d18491-d12f-4888-815d-d39441a68705","block_type":"box","text":"II-55","page_number":387,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"033fc2f6-b2f0-4095-b139-bd3d5fce429d","block_type":"box","text":"NM1026U-6004382-387/605","page_number":387,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9de3cd53-e774-466c-8e74-8e4f8b336b6e","block_type":"box","text":"to military conflict. Additionally, China is alleged to have participated in state-sponsored cyberattacks","page_number":388,"box":{"x":116,"y":87,"width":752,"height":12}},{"id":"7b7bc300-9d1a-4a6b-aa8c-329ceb2f7174","block_type":"box","text":"against foreign companies and foreign governments. Actual and threatened responses to such activity","page_number":388,"box":{"x":116,"y":102,"width":763,"height":13}},{"id":"00753203-df86-4d29-b107-e151ef01205d","block_type":"box","text":"and strained international relations, including purchasing restrictions, sanctions, tariffs or cyberattacks","page_number":388,"box":{"x":116,"y":118,"width":760,"height":12}},{"id":"27e0bd49-f286-4cfa-9933-b618df913db9","block_type":"box","text":"on the Chinese government or Chinese companies, may impact China’s economy and Chinese issuers","page_number":388,"box":{"x":116,"y":134,"width":769,"height":12}},{"id":"5a54efca-e9ad-4fcd-8ab6-3ae56eb6e9c1","block_type":"box","text":"of securities in which a Fund invests. China could be affected by military events on the Korean","page_number":388,"box":{"x":116,"y":149,"width":705,"height":12}},{"id":"12213623-4373-4571-9622-4c689d43f33b","block_type":"box","text":"peninsula or internal instability within North Korea. These situations may cause uncertainty in the","page_number":388,"box":{"x":117,"y":165,"width":723,"height":12}},{"id":"6a83810f-17a6-4439-9baf-268c53eaab6d","block_type":"box","text":"Chinese market and may adversely affect the performance of the Chinese economy.","page_number":388,"box":{"x":117,"y":180,"width":631,"height":12}},{"id":"39c47fa9-54a5-42f7-aa40-4c940d4b5d88","block_type":"box","text":"The Chinese government has implemented economic reforms in order to liberalize trade policy,","page_number":388,"box":{"x":116,"y":211,"width":712,"height":12}},{"id":"b1a60d9e-1124-4850-93c4-c5e9b2872814","block_type":"box","text":"promote foreign investment in the economy, reduce government control of the economy and develop","page_number":388,"box":{"x":117,"y":227,"width":752,"height":12}},{"id":"56a1a88f-2eb9-4ac1-aba4-7f3d98711353","block_type":"box","text":"market mechanisms. However, the Chinese government still exercises substantial influence over many","page_number":388,"box":{"x":117,"y":242,"width":768,"height":12}},{"id":"eb649c8d-a44b-4b73-b9a5-32005cb133bf","block_type":"box","text":"aspects of the private sector and may own or control many companies. Chinese companies, such as","page_number":388,"box":{"x":116,"y":258,"width":751,"height":12}},{"id":"268c3fe4-f27b-488c-858d-986a1cfcb94a","block_type":"box","text":"those in the financial services or technology sectors, and potentially other sectors in the future, are","page_number":388,"box":{"x":116,"y":273,"width":736,"height":12}},{"id":"bc51dd7b-7684-44ed-87cf-bb4a7ebb9807","block_type":"box","text":"subject to the risk that Chinese authorities can intervene in their operations and structure. The Chinese","page_number":388,"box":{"x":116,"y":289,"width":769,"height":12}},{"id":"017a0a52-9638-49a6-8681-d3692e229722","block_type":"box","text":"government continues to maintain a major role in economic policymaking and investing in China","page_number":388,"box":{"x":116,"y":304,"width":717,"height":12}},{"id":"f955b6ed-9905-40f5-ad3c-5d0cf21461e9","block_type":"box","text":"involves risk of loss due to expropriation, nationalization, confiscation of assets and property or the","page_number":388,"box":{"x":117,"y":320,"width":736,"height":12}},{"id":"cefa7717-1e9a-4e59-a1b1-90f3111304bc","block_type":"box","text":"imposition of restrictions on foreign investments and on repatriation of capital invested.","page_number":388,"box":{"x":117,"y":335,"width":647,"height":12}},{"id":"a82acc44-31fe-4e0e-b172-e7054ae87bde","block_type":"box","text":"The Chinese government may intervene in the Chinese financial markets, such as by the imposition of","page_number":388,"box":{"x":116,"y":366,"width":764,"height":12}},{"id":"a23f1a1a-ca6b-4229-af3b-65fb7dbcec43","block_type":"box","text":"trading restrictions, a ban on “naked” short selling or the suspension of short selling for certain stocks.","page_number":388,"box":{"x":116,"y":382,"width":761,"height":12}},{"id":"f4aa5cd9-b243-4e51-ac4c-6984f203cf19","block_type":"box","text":"This may affect market price and liquidity of these stocks, and may have an unpredictable impact on","page_number":388,"box":{"x":116,"y":397,"width":748,"height":12}},{"id":"926dcb15-0077-4fc1-8158-1bd8b223adb4","block_type":"box","text":"the investment activities of the Funds. Furthermore, such market interventions may have a negative","page_number":388,"box":{"x":116,"y":413,"width":745,"height":12}},{"id":"39c1aeb2-af1a-48d0-b578-dec9a7b40611","block_type":"box","text":"impact on market sentiment which may in turn affect the performance of the securities markets and as","page_number":388,"box":{"x":117,"y":428,"width":762,"height":12}},{"id":"aca7c324-8e56-4c6d-9a37-136dcd93f15b","block_type":"box","text":"a result the performance of the Funds.","page_number":388,"box":{"x":116,"y":444,"width":290,"height":12}},{"id":"c724e53d-d9f8-4739-8bd7-87acef40cdb6","block_type":"box","text":"In addition, there is less regulation and monitoring of Chinese securities markets and the activities of","page_number":388,"box":{"x":117,"y":475,"width":724,"height":12}},{"id":"9063c86e-1b2d-4b9e-adfd-585492b6a3e0","block_type":"box","text":"investors, brokers and other participants than in the United States. Accordingly, issuers of securities in","page_number":388,"box":{"x":117,"y":490,"width":737,"height":12}},{"id":"056dbff2-fcfe-4427-aebb-013256bd22a9","block_type":"box","text":"China, including Chinese companies that are listed on U.S. exchanges, are not subject to the same","page_number":388,"box":{"x":117,"y":506,"width":717,"height":12}},{"id":"905de66b-9469-4311-a6a2-50674449cad0","block_type":"box","text":"degree of regulation as are U.S. issuers with respect to such matters as insider trading rules, tender offer","page_number":388,"box":{"x":116,"y":521,"width":758,"height":12}},{"id":"0829aa10-c90d-40e9-ad87-b2da536aa5b1","block_type":"box","text":"regulation, accounting standards or auditor oversight, stockholder proxy requirements and the","page_number":388,"box":{"x":117,"y":537,"width":677,"height":12}},{"id":"0e91cc9f-2530-49f7-a578-9c5628f10b51","block_type":"box","text":"requirements mandating timely and accurate disclosure of information. Securities markets in China are in","page_number":388,"box":{"x":117,"y":552,"width":758,"height":12}},{"id":"db1a480e-a701-4999-a3a6-dbcb8a2f1f9d","block_type":"box","text":"the process of change and further development. This may lead to trading volatility, difficulty in the","page_number":388,"box":{"x":116,"y":568,"width":702,"height":12}},{"id":"1cb9c35c-e09c-4ac7-a22a-e51c7358e5f7","block_type":"box","text":"settlement and recording of transactions and difficulty in interpreting and applying the relevant regulation.","page_number":388,"box":{"x":116,"y":583,"width":758,"height":12}},{"id":"d800d0c5-ff9a-4f75-80fc-e48b9b76ffc5","block_type":"box","text":"Custodians may not be able to offer the level of service and safe-keeping in relation to the settlement and","page_number":388,"box":{"x":117,"y":599,"width":760,"height":12}},{"id":"9461e469-1077-4449-a8ca-185b2770a6dd","block_type":"box","text":"administration of securities in China that is customary in more developed markets. In particular, there is a","page_number":388,"box":{"x":116,"y":614,"width":759,"height":12}},{"id":"367a802b-b0e9-4847-beec-f229237af5a0","block_type":"box","text":"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":388,"box":{"x":117,"y":630,"width":762,"height":12}},{"id":"794b21de-8604-4529-80e0-0e506c719d77","block_type":"box","text":"sub-custodian.","page_number":388,"box":{"x":116,"y":645,"width":110,"height":10}},{"id":"0b45f59f-3fdf-4584-9016-7059cae1ec05","block_type":"box","text":"There may be significant obstacles to obtaining information necessary for investigations into or","page_number":388,"box":{"x":116,"y":676,"width":702,"height":12}},{"id":"df6e11de-9760-4a4f-843d-020eb2986407","block_type":"box","text":"litigation against Chinese companies, and shareholders may have limited legal remedies. The Funds","page_number":388,"box":{"x":117,"y":692,"width":745,"height":12}},{"id":"b9e787fc-52d2-4670-920b-a16561e2cd3d","block_type":"box","text":"do not select investments based on investor protection considerations.","page_number":388,"box":{"x":116,"y":707,"width":522,"height":12}},{"id":"04af9eb8-5780-4e8c-8c56-1507d4e3e2e2","block_type":"box","text":"The Chinese government historically took positions","page_number":388,"box":{"x":116,"y":738,"width":370,"height":12}},{"id":"ad454d57-a73d-4f0e-be33-df5bfed30b4f","block_type":"box","text":"that prevented the U.S. P","page_number":388,"box":{"x":492,"y":738,"width":184,"height":12}},{"id":"6521df4d-63f6-4779-b4b0-a4a6487edf63","block_type":"box","text":"ublic Company Accounting","page_number":388,"box":{"x":677,"y":738,"width":194,"height":12}},{"id":"5c74bd37-18cd-4abe-8a99-d5f004039f42","block_type":"box","text":"Oversight Board (“PCAOB”) from inspecting the audit wo","page_number":388,"box":{"x":116,"y":754,"width":412,"height":12}},{"id":"f0cae2fc-0b40-4a3e-ace4-25a0ab194ffe","block_type":"box","text":"rk and practices of accounting firms in mainland","page_number":388,"box":{"x":530,"y":754,"width":345,"height":12}},{"id":"70e397b8-399f-401f-823f-76d2db8e217c","block_type":"box","text":"China and Hong Kong for compliance with U.S. law","page_number":388,"box":{"x":117,"y":769,"width":372,"height":12}},{"id":"c60fc9f6-12b3-425a-9bf4-1d803a5a2685","block_type":"box","text":"and professional standards. On August 26, 2022, the","page_number":388,"box":{"x":494,"y":769,"width":385,"height":12}},{"id":"976c24a4-6a50-4135-8a95-bc78a05f1dc6","block_type":"box","text":"PCAOB signed a Statement of Prot","page_number":388,"box":{"x":117,"y":785,"width":256,"height":12}},{"id":"ddb1b3a4-e3e6-41fe-8838-fa494aebb118","block_type":"box","text":"ocol with the China Securities Regulatory Commission and the","page_number":388,"box":{"x":374,"y":785,"width":454,"height":12}},{"id":"fe873647-b229-4c9f-bcc6-729f7edf4a64","block_type":"box","text":"Ministry of Finance of the PRC, which marked the first step toward opening access for the PCAOB to","page_number":388,"box":{"x":117,"y":800,"width":732,"height":12}},{"id":"a8697cce-c79c-4663-8ac2-aaca774252d6","block_type":"box","text":"inspect and investigate registered public accounting firms headquartered in mainland China and Hong","page_number":388,"box":{"x":117,"y":816,"width":739,"height":12}},{"id":"d806ba8f-ef21-49f8-a18b-444b26ee7416","block_type":"box","text":"Kong completely in accordance with U.S. law. However, as this development is relatively recent, the","page_number":388,"box":{"x":117,"y":831,"width":730,"height":12}},{"id":"c5da8463-e15f-457c-8367-17125af5b0a8","block_type":"box","text":"implementation of the Statement","page_number":388,"box":{"x":117,"y":847,"width":241,"height":12}},{"id":"52cddc9f-c5c7-4572-b937-825188a6a87b","block_type":"box","text":"of Protocol remains to be tested. Audits performed by PCAOB","page_number":388,"box":{"x":358,"y":847,"width":456,"height":12}},{"id":"48c7f14f-652b-424f-8242-f63b7a247f4c","block_type":"box","text":"registered accounting firms in mainland China and Hong Kong may be less reliable than those performed","page_number":388,"box":{"x":117,"y":862,"width":767,"height":12}},{"id":"50df7c76-f139-4e7f-9095-c149949ac91c","block_type":"box","text":"by firms subject to PCAOB inspection. Accordingly,","page_number":388,"box":{"x":117,"y":878,"width":376,"height":12}},{"id":"b97083da-aa50-4f34-906d-e374783ae8d9","block_type":"box","text":"information about the Chinese securities in which the","page_number":388,"box":{"x":494,"y":878,"width":388,"height":9}},{"id":"256e1d6a-bfa5-4bfb-9252-3c4b70a67146","block_type":"box","text":"II-56","page_number":388,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"d660f305-85b3-4236-b40f-c8a555ee9818","block_type":"box","text":"NM1026U-6004382-388/605","page_number":388,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6ad145d7-cd00-4ccf-b02d-c9deae51cf40","block_type":"box","text":"Funds invest may be less reliable or complete. U","page_number":389,"box":{"x":117,"y":87,"width":352,"height":12}},{"id":"fc09a57b-726b-4d46-accd-c7a0c49d7ab1","block_type":"box","text":"nder amendments to the Sarbanes-Oxley Act enacted in","page_number":389,"box":{"x":472,"y":87,"width":414,"height":12}},{"id":"e17c25fa-96ab-4f27-922a-4b159eebd97e","block_type":"box","text":"December 2020, which requires that the PCAOB be permi","page_number":389,"box":{"x":117,"y":102,"width":421,"height":12}},{"id":"7a584db2-abe6-4be6-931d-e971e4e19b1c","block_type":"box","text":"tted to inspect the accounting firm of a U.S.-","page_number":389,"box":{"x":539,"y":102,"width":320,"height":13}},{"id":"9dc69496-53ff-47bf-b646-abc9cec7ca30","block_type":"box","text":"listed Chinese issuer, Chinese companies with securi","page_number":389,"box":{"x":117,"y":118,"width":385,"height":12}},{"id":"fd757a5e-c9ca-4d7f-bb34-5b9693065223","block_type":"box","text":"ties listed on U.S. exchanges may be delisted if the","page_number":389,"box":{"x":504,"y":118,"width":376,"height":12}},{"id":"b1f1568e-f873-4dc4-8376-8417f922c429","block_type":"box","text":"PCAOB is unable to inspect the accounting firm.","page_number":389,"box":{"x":117,"y":134,"width":355,"height":12}},{"id":"99188bd5-68ae-413c-bd0b-eabd70878e9f","block_type":"box","text":"The Renminbi (“RMB”) is currently not a freely convertible currency and is subject to foreign exchange","page_number":389,"box":{"x":116,"y":165,"width":763,"height":12}},{"id":"2cd95b2b-7dfd-4d23-b8b1-bb5b423a9192","block_type":"box","text":"control policies and repatriation restrictions imposed by the Chinese government. The imposition of","page_number":389,"box":{"x":116,"y":180,"width":740,"height":12}},{"id":"1610a861-6f96-468e-a2b7-401ba9693d14","block_type":"box","text":"currency controls may negatively impact performance and liquidity of the Funds as capital may become","page_number":389,"box":{"x":116,"y":196,"width":772,"height":12}},{"id":"41c7754d-57e6-4504-9db1-38a206032f4e","block_type":"box","text":"trapped in the PRC. The Funds could be adversely affected by delays in, or a refusal to grant, any","page_number":389,"box":{"x":116,"y":211,"width":732,"height":12}},{"id":"2f29403a-25df-44df-b508-ed103a1243f5","block_type":"box","text":"required governmental approval for repatriation of capital, as well as by the application to the Funds of","page_number":389,"box":{"x":117,"y":227,"width":762,"height":12}},{"id":"87d9891f-357c-4ce1-a4f1-f9d2ec150d01","block_type":"box","text":"any restrictions on investments. Investing in entities either in, or which have a substantial portion of","page_number":389,"box":{"x":116,"y":242,"width":740,"height":12}},{"id":"4e824010-6398-4210-a8f5-16ba35dcadd5","block_type":"box","text":"their operations in, the PRC may require the Funds to adopt special procedures, seek local","page_number":389,"box":{"x":116,"y":258,"width":680,"height":12}},{"id":"d7d24fe1-5b71-4af9-827a-a4d48ba2d4f1","block_type":"box","text":"government approvals or take other actions, each of which may involve additional costs and delays to","page_number":389,"box":{"x":116,"y":273,"width":759,"height":12}},{"id":"34539a36-f280-46ab-b16a-d448de98aa3e","block_type":"box","text":"the Funds. The Fund may also incur costs in connection with conversions between U.S. dollars and","page_number":389,"box":{"x":116,"y":289,"width":743,"height":12}},{"id":"c96930d7-a456-4683-ab84-f36e61f5e6ea","block_type":"box","text":"RMB, as well as in connection with conversions between the two separate types of RMB, the onshore","page_number":389,"box":{"x":117,"y":304,"width":758,"height":12}},{"id":"776e4c73-9e51-44c7-9f8f-f1bfe1c26183","block_type":"box","text":"RMB (“CNY”) and the offshore RMB (“CNH”).","page_number":389,"box":{"x":117,"y":320,"width":340,"height":12}},{"id":"b6d31a33-6b54-47fe-b6c6-ac0a76a5e256","block_type":"box","text":"Many Chinese companies listed on U.S. exchanges use variable interest entities or “VIEs” in their","page_number":389,"box":{"x":117,"y":351,"width":727,"height":12}},{"id":"4bf9eec8-5491-4685-a99d-26d7bf026b7d","block_type":"box","text":"structure as a result of foreign ownership restrictions. In a VIE structure, a Chinese operating company","page_number":389,"box":{"x":116,"y":366,"width":767,"height":12}},{"id":"19a8e1b7-930e-4b57-8b90-e08a96fb3001","block_type":"box","text":"establishes a shell company in another jurisdiction to issue stock to public shareholders. When a VIE","page_number":389,"box":{"x":116,"y":382,"width":754,"height":12}},{"id":"4b9f1b61-89bf-4347-a6a4-7d596123747f","block_type":"box","text":"structure is used by a Chinese company to list its stock in the U.S., instead of owning the equity","page_number":389,"box":{"x":116,"y":397,"width":715,"height":12}},{"id":"51b9d342-0aa9-4107-a920-3365da51098d","block_type":"box","text":"securities of the Chinese company, the U.S.-listed shell company directly or indirectly enters into","page_number":389,"box":{"x":116,"y":413,"width":721,"height":12}},{"id":"4393ad0b-2bad-42db-8889-0f94a9c6c18c","block_type":"box","text":"contracts with the Chinese operating company under Chinese law. These contracts provide the U.S.-","page_number":389,"box":{"x":116,"y":428,"width":749,"height":12}},{"id":"73e87144-a510-4e5e-9a11-514d80d479d1","block_type":"box","text":"listed shell company with only economic exposure to the Chinese company and do not represent","page_number":389,"box":{"x":117,"y":444,"width":722,"height":12}},{"id":"1e40b855-dfd8-40fb-8489-40e817e18013","block_type":"box","text":"equity ownership in the operating company.","page_number":389,"box":{"x":116,"y":459,"width":329,"height":12}},{"id":"59b38608-4a78-45f9-b3ef-057ee00976df","block_type":"box","text":"While VIEs are a longstanding practice that is well known to Chinese officials and regulators, they have","page_number":389,"box":{"x":116,"y":490,"width":770,"height":12}},{"id":"896d3ad5-07ad-4516-b3da-2871ea3217b8","block_type":"box","text":"not been formally recognized under Chinese law. The Chinese government has provided guidance to","page_number":389,"box":{"x":117,"y":506,"width":754,"height":12}},{"id":"154721dc-e257-4220-9093-d1497c78771b","block_type":"box","text":"and placed restrictions on Chinese-based companies raising capital offshore, including through VIEs.","page_number":389,"box":{"x":116,"y":521,"width":755,"height":12}},{"id":"3195072b-b7c1-4fd7-9451-d9b884559b73","block_type":"box","text":"In 2023, the China Securities Regulatory Commission (“CSRC”) released new rules that permit the use","page_number":389,"box":{"x":117,"y":537,"width":768,"height":12}},{"id":"35c1cb20-1da2-4dcc-9f97-1e63b73e506b","block_type":"box","text":"of VIE structures, provided they abide by Chinese laws and register with the CSRC. The rules,","page_number":389,"box":{"x":116,"y":552,"width":705,"height":12}},{"id":"1e5b9038-fc62-4824-9991-e7b8f6f6d8b7","block_type":"box","text":"however, may cause Chinese companies to undergo greater scrutiny and add costs to VIE structures.","page_number":389,"box":{"x":117,"y":568,"width":759,"height":12}},{"id":"4091bab8-32ec-41b9-847d-dd1a2c11696e","block_type":"box","text":"Intervention, rulemaking or guidance by the Chinese government with respect to VIE structures or the","page_number":389,"box":{"x":117,"y":583,"width":758,"height":12}},{"id":"5487ddf8-cb66-438a-91da-c14dd51acdaf","block_type":"box","text":"non-enforcement of VIE-related contractual rights could significantly affect the operating company’s","page_number":389,"box":{"x":117,"y":599,"width":742,"height":12}},{"id":"51d502bd-4ca4-4ca4-8b87-fc6ef964dd98","block_type":"box","text":"business in China, the enforceability of the U.S.-listed shell company’s contractual arrangements with","page_number":389,"box":{"x":117,"y":614,"width":756,"height":12}},{"id":"923d7b0b-536a-44f5-958f-1391bba5b2f1","block_type":"box","text":"the Chinese company and the value of the U.S.-listed stock. Further, the VIE contractual arrangement","page_number":389,"box":{"x":116,"y":630,"width":762,"height":12}},{"id":"8b1b4d8a-e4de-4987-b5a9-06e890a3cc08","block_type":"box","text":"would likely be subject to Chinese law and jurisdiction, and remedies available to the U.S.-listed shell","page_number":389,"box":{"x":116,"y":645,"width":754,"height":12}},{"id":"e22e8a11-43f7-4850-bef4-7740c2c0f8eb","block_type":"box","text":"company are uncertain and could be ineffective. In addition to the risk of government intervention,","page_number":389,"box":{"x":116,"y":661,"width":724,"height":12}},{"id":"7e82e61a-5340-4285-bf5a-b19946c7d1c7","block_type":"box","text":"investments through a VIE structure are subject to the risk that the China-based company (or its","page_number":389,"box":{"x":117,"y":676,"width":711,"height":12}},{"id":"61c59541-e198-487d-8c53-1b62d9d8274b","block_type":"box","text":"officers, directors, or Chinese equity owners) may breach those contractual arrangements, or Chinese","page_number":389,"box":{"x":116,"y":692,"width":757,"height":12}},{"id":"98963632-6ac2-42f4-814b-47dda48768ff","block_type":"box","text":"law changes in a way that adversely affects the enforceability of these arrangements, or those","page_number":389,"box":{"x":117,"y":707,"width":697,"height":12}},{"id":"2b5dd885-7cf1-4fe3-9b4c-c44738270de8","block_type":"box","text":"contracts are otherwise not enforceable under Chinese law, in which case the Fund may suffer","page_number":389,"box":{"x":116,"y":723,"width":703,"height":12}},{"id":"ee7a8b8b-2b0f-4088-ac0d-fb03c09569b4","block_type":"box","text":"significant losses on its investments through a VIE structure with little or no recourse available. Any","page_number":389,"box":{"x":116,"y":738,"width":736,"height":12}},{"id":"dc91c75f-8a4c-4d37-87ec-06b45fbc2bc4","block_type":"box","text":"change in the operations of entities in a VIE structure, the status of VIE contractual arrangements or","page_number":389,"box":{"x":116,"y":754,"width":743,"height":12}},{"id":"1731c334-efc9-4dee-84b0-f6f4a20d6c5e","block_type":"box","text":"the legal or regulatory environment in China, generally or with respect to specific industries, could","page_number":389,"box":{"x":116,"y":769,"width":723,"height":12}},{"id":"b60a9d3e-7089-474a-b804-2b6a39c7479c","block_type":"box","text":"result in significant, and possibly permanent and/or total, losses to a Fund.","page_number":389,"box":{"x":117,"y":785,"width":550,"height":12}},{"id":"cd2a488a-ec50-4e27-bfe0-9f33732888aa","block_type":"box","text":"While the Chinese economy has experienced past periods of rapid growth, there is no assurance that","page_number":389,"box":{"x":116,"y":816,"width":753,"height":12}},{"id":"1cf72f6e-bfc3-4bda-af32-3b7177280be0","block_type":"box","text":"such growth rates will recur. Other economic challenges for China include indebtedness, weak","page_number":389,"box":{"x":116,"y":831,"width":706,"height":12}},{"id":"8cdee236-40cf-41fd-81ed-ab25b4e15695","block_type":"box","text":"consumer demand, trade tensions, and an aging population. China continues to face pressure from its","page_number":389,"box":{"x":116,"y":847,"width":763,"height":12}},{"id":"e2e3b946-387d-41b5-a250-6ad0c4371f89","block_type":"box","text":"trading partners over its exporting of its excess industrial capacity and overall approach to economic","page_number":389,"box":{"x":116,"y":862,"width":748,"height":12}},{"id":"335e7538-1db8-4f09-afb6-9f1486add18d","block_type":"box","text":"management. China’s economy is heavily dependent on export growth. Reduction in spending on","page_number":389,"box":{"x":117,"y":878,"width":727,"height":12}},{"id":"fc1afd49-9dfb-435d-bf1b-9057481660c0","block_type":"box","text":"II-57","page_number":389,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"82dcf117-c239-43ea-b60d-b8b0c7d4b129","block_type":"box","text":"NM1026U-6004382-389/605","page_number":389,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a0250998-0b89-44f0-a690-02defe4cb925","block_type":"box","text":"Chinese products and services, supply chain diversification, institution of additional tariffs, sanctions or","page_number":390,"box":{"x":117,"y":87,"width":765,"height":12}},{"id":"5843ebd2-fabf-4f6e-b58d-07c845968584","block_type":"box","text":"other trade barriers (including as a result of heightened trade tensions between China and the United","page_number":390,"box":{"x":116,"y":102,"width":755,"height":13}},{"id":"629d7495-263e-449d-819f-874797ae2bd8","block_type":"box","text":"States or in response to actual or alleged Chinese cyber activity) or a downturn in any of the","page_number":390,"box":{"x":116,"y":118,"width":688,"height":12}},{"id":"8b3dc78b-c9eb-496e-8cba-40c0279ceff1","block_type":"box","text":"economies of China’s key trading partners may have an adverse impact on the Chinese economy and","page_number":390,"box":{"x":116,"y":134,"width":762,"height":12}},{"id":"f03425d4-6ba0-47b6-a74b-19c43b984228","block_type":"box","text":"the companies in which a Fund invests. Certain Chinese companies (which may change from time to","page_number":390,"box":{"x":116,"y":149,"width":753,"height":12}},{"id":"72bfeb7c-97a8-4d91-82b0-fdb90d558998","block_type":"box","text":"time) are directly or indirectly subject to economic or trade restrictions imposed by the U.S. or other","page_number":390,"box":{"x":116,"y":165,"width":741,"height":12}},{"id":"a2f3a739-097a-4c33-82ac-b0d9076c480f","block_type":"box","text":"governments due to national security, human rights or other concerns of such government. For","page_number":390,"box":{"x":116,"y":180,"width":709,"height":12}},{"id":"1781272f-4731-4dd0-84ae-72ca1f1d555b","block_type":"box","text":"example, certain foreign technology companies are subject to U.S. export controls as those companies","page_number":390,"box":{"x":116,"y":196,"width":769,"height":12}},{"id":"1f664ac8-48bc-44e3-bf53-7f22b88385cf","block_type":"box","text":"are believed to pose a risk to U.S. interests. The U.S. also bans imports of goods produced in certain","page_number":390,"box":{"x":116,"y":211,"width":755,"height":12}},{"id":"7ee7f4e7-64d9-4090-90e6-aa0154a737a8","block_type":"box","text":"regions of China or by certain Chinese companies due to concerns about forced labor. Such","page_number":390,"box":{"x":117,"y":227,"width":688,"height":12}},{"id":"41b1d645-e313-4607-9a4f-6392a4ae9a18","block_type":"box","text":"restrictions may have unanticipated and adverse effects on the Chinese economy and companies. Any","page_number":390,"box":{"x":117,"y":242,"width":767,"height":12}},{"id":"764978be-1882-49f6-9b1b-10944956a432","block_type":"box","text":"action that targets Chinese financial markets or securities exchanges could interfere with orderly","page_number":390,"box":{"x":116,"y":258,"width":719,"height":12}},{"id":"b9be2488-5dc1-4149-9d8d-186dc8599437","block_type":"box","text":"trading, delay settlement or cause market disruptions. Certain companies may be subject to economic","page_number":390,"box":{"x":116,"y":273,"width":762,"height":12}},{"id":"660a5fe4-37d0-4ba9-99b8-d7381a1e4031","block_type":"box","text":"or trade restrictions (but not investment restrictions) imposed by the U.S. or other governments due to","page_number":390,"box":{"x":116,"y":289,"width":761,"height":12}},{"id":"434937d9-f7c0-45cc-a0af-ab7a61343d98","block_type":"box","text":"national security, human rights or other concerns of such government. So long as these restrictions do","page_number":390,"box":{"x":117,"y":304,"width":764,"height":12}},{"id":"fd0bfadd-a3ab-40cb-8293-e35f43fae21a","block_type":"box","text":"not include restrictions on investments, the Fund may invest in such companies.","page_number":390,"box":{"x":117,"y":320,"width":599,"height":12}},{"id":"17ea5c5c-a61b-4852-b651-174805050f5e","block_type":"box","text":"The tax laws and regulations in the PRC are subject to change, including the issuance of authoritative","page_number":390,"box":{"x":116,"y":352,"width":760,"height":12}},{"id":"1d669020-cd5b-49e3-937a-3cde38abc830","block_type":"box","text":"guidance or enforcement, possibly with retroactive effect. The interpretation, applicability and","page_number":390,"box":{"x":116,"y":368,"width":695,"height":12}},{"id":"e1e66625-958b-44bd-b377-47b66faebbe6","block_type":"box","text":"enforcement of such laws by PRC tax authorities are not as consistent and transparent as those of","page_number":390,"box":{"x":116,"y":383,"width":737,"height":12}},{"id":"27ca07d0-bfe1-40b6-b4f5-e6fc696e5d80","block_type":"box","text":"more developed nations, and may vary over time and from region to region. The application and","page_number":390,"box":{"x":117,"y":399,"width":716,"height":12}},{"id":"166d85fd-486f-4ddd-874a-889c73cab541","block_type":"box","text":"enforcement of PRC tax rules could have a significant adverse effect on a Fund and its investors,","page_number":390,"box":{"x":116,"y":414,"width":727,"height":12}},{"id":"7560fd38-d7d7-4ef2-a9b6-69a2351a2f43","block_type":"box","text":"particularly in relation to capital gains withholding tax imposed upon non-residents. In addition, the","page_number":390,"box":{"x":117,"y":430,"width":732,"height":12}},{"id":"37370080-5d34-4c0a-99ac-accb6fd26a1e","block_type":"box","text":"accounting, auditing and financial reporting standards and practices applicable to Chinese companies","page_number":390,"box":{"x":116,"y":445,"width":759,"height":12}},{"id":"16bd9101-4e14-457c-bd73-1f97412ba00b","block_type":"box","text":"may be less rigorous, and may result in significant differences between financial statements prepared","page_number":390,"box":{"x":117,"y":461,"width":757,"height":12}},{"id":"500e336e-0636-41ea-9c10-ad3b61bf70dc","block_type":"box","text":"in accordance with PRC accounting standards and practice and those prepared in accordance with","page_number":390,"box":{"x":117,"y":476,"width":739,"height":12}},{"id":"e7200002-9bdc-4e83-b635-7bc8187951cc","block_type":"box","text":"international accounting standards.","page_number":390,"box":{"x":117,"y":492,"width":264,"height":12}},{"id":"bfcf1475-87b8-4e56-a8a1-04b18aabef16","block_type":"box","text":"From time to time and in recent years, China has experienced outbreaks of infectious illnesses and the","page_number":390,"box":{"x":117,"y":524,"width":767,"height":13}},{"id":"a718c235-46e3-42e8-a1fe-144e8c218da0","block_type":"box","text":"country may be subject to other public health threats, infectious illnesses, diseases or similar issues in","page_number":390,"box":{"x":116,"y":540,"width":763,"height":12}},{"id":"d005c49e-a204-4f68-a931-081a1c2f575f","block_type":"box","text":"the future. Any spread of an infectious illness, public health threat or similar issue could reduce","page_number":390,"box":{"x":116,"y":555,"width":709,"height":13}},{"id":"a41d96c4-3e54-4a5b-bbbf-cdc55d15f0a7","block_type":"box","text":"consumer demand or economic output, result in market closures, travel restrictions or quarantines, and","page_number":390,"box":{"x":116,"y":571,"width":770,"height":12}},{"id":"c8719480-7be0-41f5-a9e3-0c700d714b87","block_type":"box","text":"generally have a significant impact on the Chinese economy, which in turn could adversely affect a","page_number":390,"box":{"x":116,"y":586,"width":738,"height":13}},{"id":"c7e2098e-c8b1-4818-b365-253fd3e9aa3b","block_type":"box","text":"Fund’s investments.","page_number":390,"box":{"x":117,"y":602,"width":153,"height":10}},{"id":"6cbcee4c-9f84-4647-a9e4-14939962a193","block_type":"box","text":"Risk of Investing through Stock Connect.","page_number":390,"box":{"x":116,"y":635,"width":308,"height":12}},{"id":"a2aef8ff-a0e4-4a1d-ac88-665c53b9f05e","block_type":"box","text":"General.","page_number":390,"box":{"x":117,"y":659,"width":62,"height":9}},{"id":"fb4ce367-8518-4976-a9cf-014deee6732b","block_type":"box","text":"China A-shares are equity securities of companies domiciled in China that trade on Chinese","page_number":390,"box":{"x":180,"y":659,"width":692,"height":12}},{"id":"8f4dc546-b344-4a2c-9017-8a04af70b1c1","block_type":"box","text":"stock exchanges such as the Shanghai Stock Exchange (“SSE”), the Shenzhen Stock Exchange","page_number":390,"box":{"x":116,"y":674,"width":718,"height":12}},{"id":"b0cf8d8f-65db-4e2c-bacf-07a91d1b0c70","block_type":"box","text":"(“SZSE”) and the Beijing Stock Exchange (“BSE”) (“A-shares”). Foreign investment in A-shares on the","page_number":390,"box":{"x":117,"y":690,"width":756,"height":12}},{"id":"c1a89511-f22d-43bc-b0d0-0e434180e7ac","block_type":"box","text":"SSE and SZSE is not permitted, other than pursuant to available exceptions, such as through a","page_number":390,"box":{"x":116,"y":705,"width":707,"height":12}},{"id":"106d8c73-cd9d-45ba-9149-954b9d8d8947","block_type":"box","text":"qualified foreign investor approved pursuant to the relevant mainland China laws and regulations as","page_number":390,"box":{"x":116,"y":721,"width":740,"height":12}},{"id":"993fce01-260d-4a43-ae31-c2e2eb889bc9","block_type":"box","text":"may be promulgated and/or amended from time to time (“QFI”).","page_number":390,"box":{"x":117,"y":736,"width":468,"height":12}},{"id":"5314db47-4831-47dd-b37e-3c0372253396","block_type":"box","text":"Investment in eligible exchange traded funds and A-shares listed and traded on the SSE or SZSE","page_number":390,"box":{"x":117,"y":769,"width":723,"height":12}},{"id":"6c3e9437-3f3f-470e-85a2-d8c435b6340c","block_type":"box","text":"(“Stock Connect Securities”) is also permitted through the Shanghai-Hong Kong Stock Connect","page_number":390,"box":{"x":117,"y":784,"width":706,"height":13}},{"id":"e29ce22c-1316-4244-9fd6-bae77a6457df","block_type":"box","text":"program or the Shenzhen-Hong Kong Stock Connect program, as applicable (each, a “Stock Connect”","page_number":390,"box":{"x":117,"y":800,"width":759,"height":12}},{"id":"27351447-ed83-4b5f-8cf0-fe1b0894a41d","block_type":"box","text":"and collectively, “Stock Connects”). Each Stock Connect is a securities trading and clearing links","page_number":390,"box":{"x":116,"y":815,"width":717,"height":13}},{"id":"566aaefc-069f-4eec-9a7c-190dac179bd8","block_type":"box","text":"program established by The Stock Exchange of Hong Kong Limited (“SEHK”), the Hong Kong","page_number":390,"box":{"x":117,"y":831,"width":699,"height":12}},{"id":"48ace482-0883-4d80-a914-158429f3aa70","block_type":"box","text":"Securities Clearing Company Limited (“HKSCC”), the SSE or SZSE, as applicable, and China","page_number":390,"box":{"x":116,"y":846,"width":700,"height":13}},{"id":"d44bcbdb-522f-42bc-bf0c-0a8c1c85c5f7","block_type":"box","text":"Securities Depository and Clearing Corporation Limited (“CSDCC”) that aims to provide mutual stock","page_number":390,"box":{"x":116,"y":862,"width":753,"height":12}},{"id":"e65fb55b-0e22-4205-8487-65eabbbf8542","block_type":"box","text":"market access between the PRC and Hong Kong by permitting investors to trade and settle shares on","page_number":390,"box":{"x":117,"y":877,"width":761,"height":13}},{"id":"e41b0490-7665-44b2-bdc9-6cbdb884cc5a","block_type":"box","text":"II-58","page_number":390,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"a8ae19f5-b32b-463c-b412-91d28706b163","block_type":"box","text":"NM1026U-6004382-390/605","page_number":390,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c54fed37-2977-4a6b-afae-5cbf42ed8fe5","block_type":"box","text":"each market through their local securities brokers. Under Stock Connects, a Fund’s trading of Stock","page_number":391,"box":{"x":116,"y":87,"width":746,"height":12}},{"id":"1a5ad2ec-529d-4a8c-ba2e-6f5656d1a6be","block_type":"box","text":"Connect Securities listed on the SSE or SZSE, as applicable, would be effectuated through its Hong","page_number":391,"box":{"x":117,"y":102,"width":747,"height":13}},{"id":"c3973b72-64ae-471f-9429-d1b09cb6b596","block_type":"box","text":"Kong broker and a securities trading service company established by SEHK.","page_number":391,"box":{"x":117,"y":118,"width":572,"height":12}},{"id":"1e530ec4-7171-4bb1-925f-7919250c8ab9","block_type":"box","text":"Although no individual investment quotas or licensing requirements apply to investors in Stock","page_number":391,"box":{"x":116,"y":149,"width":703,"height":12}},{"id":"8fe37a50-ac0e-443c-97fb-0ccec3505622","block_type":"box","text":"Connect, trading through a Stock Connect’s Northbound Trading Link is subject to daily investment","page_number":391,"box":{"x":117,"y":165,"width":738,"height":12}},{"id":"b338d3b1-f550-4a52-aee9-7a67f29526d6","block_type":"box","text":"quota limitations which require that buy orders for Stock Connect Securities be rejected once the daily","page_number":391,"box":{"x":116,"y":180,"width":761,"height":12}},{"id":"c7eb41cd-4fe9-4985-896f-f932d168fdb6","block_type":"box","text":"quota is exceeded (although a Fund will be permitted to sell their Stock Connect Securities regardless","page_number":391,"box":{"x":116,"y":196,"width":761,"height":12}},{"id":"bcee2f67-fcde-4276-ba20-ce6dad747d2d","block_type":"box","text":"of the quota). These limitations may restrict a Fund from investing in Stock Connect Securities on a","page_number":391,"box":{"x":116,"y":211,"width":741,"height":12}},{"id":"f171fe02-cc72-4a09-83a3-10761acaa66d","block_type":"box","text":"timely basis, which could affect the Fund’s ability to effectively pursue its investment strategy.","page_number":391,"box":{"x":116,"y":227,"width":698,"height":12}},{"id":"c11fa702-c9b7-43ed-8729-d0584cf0b2c7","block_type":"box","text":"Investment quotas are also subject to change. Investment in Stock Connect Securities through a Stock","page_number":391,"box":{"x":117,"y":242,"width":767,"height":12}},{"id":"5f8eb4c7-9d10-4331-9ccc-f13787e91568","block_type":"box","text":"Connect is subject to trading, clearance and settlement procedures that could pose risks to a Fund.","page_number":391,"box":{"x":117,"y":258,"width":741,"height":12}},{"id":"4a93f6dd-6990-4933-ae0d-096ef461dfcb","block_type":"box","text":"Stock Connect Securities purchased through Stock Connects generally may not be sold or otherwise","page_number":391,"box":{"x":116,"y":273,"width":753,"height":12}},{"id":"8bbba984-397d-4382-8a9b-d5097b7d8898","block_type":"box","text":"transferred other than through Stock Connects in accordance with applicable rules. For example, the","page_number":391,"box":{"x":116,"y":289,"width":752,"height":12}},{"id":"bb049d3c-fc35-4c3b-8a6f-1d74001b54bd","block_type":"box","text":"PRC regulations require that in order for an investor to sell any Stock Connect Securities on a certain","page_number":391,"box":{"x":117,"y":304,"width":755,"height":12}},{"id":"0c37a3d2-b53d-4d61-9b00-fda75aca5535","block_type":"box","text":"trading day, there must be sufficient Stock Connect Securities in the investor’s account before the","page_number":391,"box":{"x":116,"y":320,"width":730,"height":12}},{"id":"a2546157-c09e-457d-a0bf-c25178d69574","block_type":"box","text":"market opens on that day. If there are insufficient Stock Connect Securities in the investor’s account,","page_number":391,"box":{"x":117,"y":335,"width":751,"height":12}},{"id":"c913bfde-c407-4fda-a1f5-5e38e7477992","block_type":"box","text":"the sell order will be rejected by the SSE or SZSE, as applicable. SEHK carries out pre-trade checking","page_number":391,"box":{"x":116,"y":351,"width":765,"height":12}},{"id":"12d5a519-68a5-49da-96df-d2a04938548a","block_type":"box","text":"on sell orders of certain stocks listed on the SSE market (“SSE Securities”) or SZSE market (“SZSE","page_number":391,"box":{"x":116,"y":366,"width":746,"height":12}},{"id":"3507274d-3735-4608-a04f-dcf6279d6d1b","block_type":"box","text":"Securities”) of its participants (i.e., stock brokers) to ensure that this requirement is satisfied. While","page_number":391,"box":{"x":116,"y":382,"width":736,"height":12}},{"id":"18d8de00-1166-4933-b529-3bf2888fb66d","block_type":"box","text":"shares must be designated as eligible to be traded under a Stock Connect, those shares may also lose","page_number":391,"box":{"x":116,"y":397,"width":770,"height":12}},{"id":"d35024bc-31f7-4819-beda-ee5489d46561","block_type":"box","text":"such designation, and if this occurs, such shares may be sold but cannot be purchased through a","page_number":391,"box":{"x":116,"y":413,"width":728,"height":12}},{"id":"4076554a-2156-417d-9700-1a17eb95d777","block_type":"box","text":"Stock Connect. In addition, Stock Connects will only operate on days when both the Chinese and Hong","page_number":391,"box":{"x":116,"y":428,"width":771,"height":12}},{"id":"76a53bc9-0944-4b62-9f95-858966267e98","block_type":"box","text":"Kong markets are open for trading, and banking services are available in both markets on the","page_number":391,"box":{"x":117,"y":444,"width":698,"height":12}},{"id":"ad5edd4e-d015-4bd2-a028-de856af878e0","block_type":"box","text":"corresponding settlement days. Therefore, an investment in Stock Connect Securities through a Stock","page_number":391,"box":{"x":116,"y":459,"width":763,"height":12}},{"id":"c4f06867-3c22-412a-bc38-106b95e3b2d6","block_type":"box","text":"Connect may subject a Fund to a risk of price fluctuations on days when the Chinese market is open,","page_number":391,"box":{"x":117,"y":475,"width":754,"height":12}},{"id":"26de5b07-5600-4820-a126-5d72d7602921","block_type":"box","text":"but a Stock Connect is not trading. Moreover, day (turnaround) trading is not permitted on the Stock","page_number":391,"box":{"x":117,"y":490,"width":745,"height":12}},{"id":"b7b2290b-2441-41dc-b298-cbfd0319acef","block_type":"box","text":"Connect Securities market. If an investor buys Stock Connect Securities on day “T,” the investor will","page_number":391,"box":{"x":117,"y":506,"width":746,"height":12}},{"id":"5244c1da-bc28-4cfc-9ad8-6d6a2314c279","block_type":"box","text":"only be able to sell the Stock Connect Securities on or after day T+1. Further, since all trades of Stock","page_number":391,"box":{"x":116,"y":521,"width":763,"height":12}},{"id":"143a0c02-f3e8-404c-b489-e0e2f7b97519","block_type":"box","text":"Connect Securities must be settled in RMB, investors must have timely access to a reliable supply of","page_number":391,"box":{"x":117,"y":537,"width":752,"height":12}},{"id":"c4b68663-2d29-4908-bf61-97d3635abd3d","block_type":"box","text":"offshore RMB, which cannot be guaranteed. There is also no assurance that RMB will not be subject to","page_number":391,"box":{"x":116,"y":552,"width":771,"height":12}},{"id":"30298f9e-2e53-48da-a4d4-e66546482776","block_type":"box","text":"devaluation. Any devaluation of RMB could adversely affect a Fund’s investments. If a Fund holds a","page_number":391,"box":{"x":116,"y":568,"width":746,"height":12}},{"id":"3b09b1d8-405e-4ec0-bcee-9325aaada782","block_type":"box","text":"class of shares denominated in a local currency other than RMB, the Fund will be exposed to currency","page_number":391,"box":{"x":116,"y":583,"width":765,"height":12}},{"id":"ae339181-0a89-47cc-a705-b544731429a2","block_type":"box","text":"exchange risk if the Fund converts the local currency into RMB for investments in Stock Connect","page_number":391,"box":{"x":116,"y":599,"width":722,"height":12}},{"id":"4c60572d-414d-45d8-8d23-09327b2fe974","block_type":"box","text":"Securities. A Fund may also incur conversion costs.","page_number":391,"box":{"x":116,"y":614,"width":390,"height":12}},{"id":"68f1f36b-5a52-4161-91f2-7bb97b9e8bb3","block_type":"box","text":"Stock Connect Securities held through the nominee structure under a Stock Connect will be held","page_number":391,"box":{"x":116,"y":645,"width":722,"height":12}},{"id":"3e7fb86e-0372-430b-938a-8f7441ae0b55","block_type":"box","text":"through HKSCC as nominee on behalf of investors. The precise nature and rights of a Fund as the","page_number":391,"box":{"x":116,"y":661,"width":731,"height":12}},{"id":"3d0ccac7-f88e-4817-a6f2-61d59696518c","block_type":"box","text":"beneficial owner of the SSE Securities or SZSE Securities through HKSCC as nominee is not well","page_number":391,"box":{"x":117,"y":676,"width":725,"height":12}},{"id":"9e226d48-cf64-4361-8823-780536910feb","block_type":"box","text":"defined under the PRC laws. There is a lack of a clear definition of, and distinction between, legal","page_number":391,"box":{"x":116,"y":692,"width":722,"height":12}},{"id":"720c7b60-133e-4d91-9fe0-8ccf5e46afd8","block_type":"box","text":"ownership and beneficial ownership under the PRC laws and there have been few cases involving a","page_number":391,"box":{"x":116,"y":707,"width":742,"height":12}},{"id":"5c13c1cd-0b23-47a7-959c-d7be9981ae33","block_type":"box","text":"nominee account structure in the PRC courts. The exact nature and methods of enforcement of the","page_number":391,"box":{"x":117,"y":723,"width":735,"height":9}},{"id":"3eca6b58-4905-4ee5-a95f-89e9704d16a0","block_type":"box","text":"rights and interests of a Fund under the PRC laws is also uncertain. In the unlikely event that HKSCC","page_number":391,"box":{"x":117,"y":738,"width":751,"height":12}},{"id":"350a0e2d-eea6-4707-b51f-dcb23a66a790","block_type":"box","text":"becomes subject to winding up proceedings in Hong Kong, there is a risk that the SSE Securities or","page_number":391,"box":{"x":117,"y":754,"width":739,"height":12}},{"id":"6b068b8d-00b1-4d46-9820-ba301f561736","block_type":"box","text":"SZSE Securities may not be regarded as held for the beneficial ownership of a Fund or as part of the","page_number":391,"box":{"x":116,"y":769,"width":749,"height":12}},{"id":"95d39f24-0676-4c22-88b5-3a84529ef469","block_type":"box","text":"general assets of HKSCC available for general distribution to its creditors. Notwithstanding the fact that","page_number":391,"box":{"x":116,"y":785,"width":765,"height":12}},{"id":"06a01368-ebdd-4f14-a8d2-c520ded90463","block_type":"box","text":"HKSCC does not claim proprietary interests in the SSE Securities or SZSE Securities held in its","page_number":391,"box":{"x":117,"y":800,"width":709,"height":12}},{"id":"01f2165b-4b79-444b-bf1c-76599908d5c8","block_type":"box","text":"omnibus stock account in the CSDCC, the CSDCC as the share registrar for SSE- or SZSE-listed","page_number":391,"box":{"x":116,"y":816,"width":723,"height":12}},{"id":"f42c4602-f8ca-44e4-80ba-b8eff09c3c74","block_type":"box","text":"companies will still treat HKSCC as one of the shareholders when it handles corporate actions in","page_number":391,"box":{"x":116,"y":831,"width":722,"height":12}},{"id":"a0da2df2-5b23-4287-8d08-d41267b8564b","block_type":"box","text":"respect of such SSE Securities or SZSE Securities. HKSCC monitors the corporate actions affecting","page_number":391,"box":{"x":117,"y":847,"width":749,"height":12}},{"id":"28a7bfb0-3477-44c8-99ae-b1d013b1fbce","block_type":"box","text":"SSE Securities and SZSE Securities and keeps participants of Central Clearing and Settlement","page_number":391,"box":{"x":116,"y":862,"width":712,"height":12}},{"id":"f95561ce-d8e0-4e1c-972d-57cf4854747d","block_type":"box","text":"System (“CCASS”) informed of all such corporate actions that require CCASS participants to take","page_number":391,"box":{"x":116,"y":878,"width":729,"height":12}},{"id":"d6af78c0-8648-4df3-a5d4-a75b74d68ec7","block_type":"box","text":"II-59","page_number":391,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"6e933a5b-d06d-4272-9e37-991fdfc78fe6","block_type":"box","text":"NM1026U-6004382-391/605","page_number":391,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5467430e-734b-45d0-853e-1e84595bfb69","block_type":"box","text":"steps in order to participate in them. Investors may only exercise their voting rights by providing their","page_number":392,"box":{"x":116,"y":87,"width":750,"height":12}},{"id":"fcb7a7fc-5636-4168-bc45-af72e1ae763b","block_type":"box","text":"voting instructions to HKSCC through participants of CCASS. All voting instructions from CCASS","page_number":392,"box":{"x":116,"y":102,"width":724,"height":13}},{"id":"43c0d87f-548f-4192-bf8b-6ee0f64386f2","block_type":"box","text":"participants will be consolidated by HKSCC, who will then submit a combined single voting instruction","page_number":392,"box":{"x":117,"y":118,"width":757,"height":12}},{"id":"07ae6d2f-f555-4a48-acc1-952044a0afa2","block_type":"box","text":"to the relevant SSE- or SZSE-listed company. As a result, a Fund may suffer difficulties or delays in","page_number":392,"box":{"x":116,"y":134,"width":745,"height":12}},{"id":"31a24687-ab10-4bd6-9d59-46e209ab4402","block_type":"box","text":"enforcing its rights in SSE Securities or SZSE Securities.","page_number":392,"box":{"x":116,"y":149,"width":427,"height":12}},{"id":"ece83ec6-b444-4ac2-ac05-2cbebfd3f9d8","block_type":"box","text":"Hong Kong’s Investor Compensation Fund is established to pay compensation to investors of any","page_number":392,"box":{"x":117,"y":180,"width":728,"height":12}},{"id":"971931d2-07bc-4a9f-9089-42d100022aa6","block_type":"box","text":"nationality who suffer pecuniary losses as a result of default of a licensed intermediary or authorized","page_number":392,"box":{"x":117,"y":196,"width":747,"height":12}},{"id":"5a043aa8-0085-49d2-92cf-c16013393b22","block_type":"box","text":"financial institution in relation to exchange-traded products in Hong Kong. For defaults occurring on or","page_number":392,"box":{"x":116,"y":211,"width":760,"height":12}},{"id":"0897521e-908a-4601-a75b-7b6a116445ae","block_type":"box","text":"after January 1, 2020, Hong Kong’s Investor Compensation Fund covers investors’ losses in relation to","page_number":392,"box":{"x":116,"y":227,"width":769,"height":12}},{"id":"55754c66-4a65-40e7-8350-0da9c1ecf3db","block_type":"box","text":"securities (i) that are traded on the SSE or the SZSE and (ii) in respect of which an order for sale or","page_number":392,"box":{"x":116,"y":242,"width":743,"height":12}},{"id":"cf9c2efe-85f1-4e39-a366-8290dd2576a7","block_type":"box","text":"purchase is permitted to be routed through the Northbound Trading Link of a Stock Connect. On the","page_number":392,"box":{"x":117,"y":258,"width":746,"height":12}},{"id":"207b7798-9ccf-4256-bea5-42fa171fcdbb","block_type":"box","text":"other hand, since a Fund carries out Northbound trading through securities brokers in Hong Kong but","page_number":392,"box":{"x":116,"y":273,"width":756,"height":12}},{"id":"1d0d99e5-a389-498c-8c21-fe803b39a4d5","block_type":"box","text":"not PRC brokers, it is not protected by the China Securities Investor Protection Fund in the PRC.","page_number":392,"box":{"x":117,"y":289,"width":722,"height":12}},{"id":"1bd0b0cd-ef9e-446f-95bb-23a9bd08285b","block_type":"box","text":"Market participants are able to participate in Stock Connects subject to meeting certain information","page_number":392,"box":{"x":117,"y":320,"width":737,"height":12}},{"id":"0626d249-2c22-490d-ab6b-d1a759caebd2","block_type":"box","text":"technology capability, risk management and other requirements as may be specified by the relevant","page_number":392,"box":{"x":116,"y":335,"width":746,"height":12}},{"id":"e62f8a63-400e-4374-a0ec-ec440f6d4b7e","block_type":"box","text":"exchange and/or clearing house. Further, the “connectivity” in Stock Connects requires routing of","page_number":392,"box":{"x":116,"y":351,"width":725,"height":12}},{"id":"fc917058-e729-43c3-86c8-906fc9bfc6bf","block_type":"box","text":"orders across the border of Hong Kong and the PRC. This requires the development of new","page_number":392,"box":{"x":116,"y":366,"width":687,"height":12}},{"id":"ea537177-dc95-4b2c-b8ef-d514e0910204","block_type":"box","text":"information technology systems on the part of SEHK and exchange participants. There is no assurance","page_number":392,"box":{"x":117,"y":382,"width":771,"height":12}},{"id":"18dcc094-2eba-439f-91ae-ad2768798745","block_type":"box","text":"that the systems of SEHK and market participants will function properly or will continue to be adapted","page_number":392,"box":{"x":116,"y":397,"width":757,"height":12}},{"id":"c33b61ba-d9a3-4b8b-ab3d-61bbade0af9e","block_type":"box","text":"to changes and developments in both markets. In the event that the relevant systems fail to function","page_number":392,"box":{"x":116,"y":413,"width":747,"height":12}},{"id":"e292406d-4de9-4a88-a594-f0be544def37","block_type":"box","text":"properly, trading in Stock Connect Securities through Stock Connects could be disrupted.","page_number":392,"box":{"x":117,"y":428,"width":667,"height":12}},{"id":"0f636c9d-635f-4f65-8dc0-c238f2bd173f","block_type":"box","text":"The Shanghai-Hong Kong Stock Connect program launched in November 2014 and the Shenzhen","page_number":392,"box":{"x":116,"y":459,"width":737,"height":12}},{"id":"4af262c6-293e-44ee-a40e-d893fccdef22","block_type":"box","text":"Hong Kong Stock Connect program launched in December 2016. Each program does not have an","page_number":392,"box":{"x":117,"y":475,"width":733,"height":12}},{"id":"5452fac3-9719-4a70-8d9a-8eddded419a4","block_type":"box","text":"extensive operating history. New or revised regulations may be issued from time to time by the","page_number":392,"box":{"x":116,"y":490,"width":707,"height":12}},{"id":"ca9b8f44-35c7-4369-98f2-a2769b0fa9a7","block_type":"box","text":"regulators and stock exchanges in China and Hong Kong in connection with operations, legal","page_number":392,"box":{"x":117,"y":506,"width":695,"height":12}},{"id":"3445b24f-70d2-4205-80a5-a604193c32f1","block_type":"box","text":"enforcement and cross-border trades under Stock Connects. In addition, there can be no assurance","page_number":392,"box":{"x":116,"y":521,"width":748,"height":11}},{"id":"01334748-eb54-4288-9908-df2c64732e6a","block_type":"box","text":"that Stock Connect will not be discontinued. A Fund may be adversely affected as a result of such","page_number":392,"box":{"x":116,"y":537,"width":731,"height":12}},{"id":"6762d27c-f1d5-4080-86cc-a69272639469","block_type":"box","text":"changes. Furthermore, the securities regimes and legal systems of China and Hong Kong differ","page_number":392,"box":{"x":116,"y":552,"width":714,"height":12}},{"id":"f4721bac-e163-4daf-9d1e-28b4f47dfade","block_type":"box","text":"significantly and issues may arise from the differences on an on-going basis. In the event that the","page_number":392,"box":{"x":116,"y":568,"width":727,"height":12}},{"id":"082ee89c-92ab-433f-ad1b-cea3e44d13a2","block_type":"box","text":"relevant systems fail to function properly, trading in both markets through Stock Connects could be","page_number":392,"box":{"x":117,"y":583,"width":737,"height":12}},{"id":"8863e13c-a1c4-49f7-9e83-a53325ccab02","block_type":"box","text":"disrupted and a Fund’s ability to achieve its investment objective may be adversely affected. In","page_number":392,"box":{"x":116,"y":599,"width":708,"height":12}},{"id":"d79fd30b-4ffe-46d9-a646-9e723ec0f1b1","block_type":"box","text":"addition, a Fund’s investments in Stock Connect Securities through Stock Connects are generally","page_number":392,"box":{"x":116,"y":614,"width":728,"height":12}},{"id":"ebede98a-8129-45e5-b281-b744e25ef265","block_type":"box","text":"subject to Chinese securities regulations and listing rules, among other restrictions. Further, different","page_number":392,"box":{"x":116,"y":630,"width":751,"height":12}},{"id":"8530419b-dce1-4ef9-a8e3-41a4424686d8","block_type":"box","text":"fees, costs and taxes are imposed on foreign investors acquiring Stock Connect Securities through","page_number":392,"box":{"x":116,"y":645,"width":739,"height":12}},{"id":"a4e1911e-2d3c-474e-8747-ca76b51db306","block_type":"box","text":"Stock Connects, and these fees, costs and taxes may be higher than comparable fees, costs and","page_number":392,"box":{"x":116,"y":661,"width":722,"height":12}},{"id":"f9f4f42b-683c-42b3-86d7-f4b82cc6573c","block_type":"box","text":"taxes imposed on owners of other securities providing similar investment exposure.","page_number":392,"box":{"x":116,"y":676,"width":618,"height":12}},{"id":"2c28f01e-f193-47a4-868e-4f541b3bc4f1","block_type":"box","text":"Suspension Risk.","page_number":392,"box":{"x":117,"y":707,"width":127,"height":12}},{"id":"8d886c18-5690-4dab-a045-d437a37cfed9","block_type":"box","text":"SSE Securities and SZSE Securities may only be bought from, or sold to, a Fund at","page_number":392,"box":{"x":251,"y":707,"width":620,"height":12}},{"id":"50ef23e9-6bf8-4bf5-bfd1-46c96bd5cfb6","block_type":"box","text":"times when the relevant SSE Securities and SZSE Securities may be sold or purchased on the","page_number":392,"box":{"x":116,"y":723,"width":704,"height":12}},{"id":"d14e570d-95e2-4bf8-a32d-567243da4d30","block_type":"box","text":"relevant Chinese stock exchange. The SSE Securities and SZSE Securities markets have a higher","page_number":392,"box":{"x":117,"y":738,"width":733,"height":12}},{"id":"6a1fcdc4-5891-4e19-85b0-72f1bbcd9b86","block_type":"box","text":"propensity for trading suspensions than many other global equity markets. Each of the SEHK, SSE and","page_number":392,"box":{"x":117,"y":754,"width":765,"height":12}},{"id":"5f46d767-4fd0-4447-9025-31bd50fe33f0","block_type":"box","text":"SZSE reserves the right to suspend trading of SSE Securities and SZSE Securities purchased on the","page_number":392,"box":{"x":116,"y":769,"width":751,"height":12}},{"id":"230ac6e7-2453-4882-a766-331b5c4db464","block_type":"box","text":"Stock Connects if necessary for ensuring an orderly and fair market and ensuring that risks are","page_number":392,"box":{"x":116,"y":785,"width":705,"height":12}},{"id":"f551ff2f-2f66-4f71-b4cf-c289dabb9c39","block_type":"box","text":"managed prudently. Consent from the relevant regulator would be sought before a suspension of","page_number":392,"box":{"x":117,"y":800,"width":720,"height":12}},{"id":"d943673a-6ed9-4241-9ab3-c67698500197","block_type":"box","text":"Northbound trading is triggered. The relevant PRC government authority may also impose “circuit","page_number":392,"box":{"x":117,"y":816,"width":722,"height":12}},{"id":"940bdcd8-b1c7-4719-8b2e-3f8a0fb64797","block_type":"box","text":"breakers” and other measures to halt or suspend Northbound trading. Where a suspension in the","page_number":392,"box":{"x":117,"y":831,"width":725,"height":12}},{"id":"0782a0d1-81e6-45ea-8715-39221c1877f2","block_type":"box","text":"Northbound trading through Stock Connect is effected, the Fund’s ability to access the PRC market will","page_number":392,"box":{"x":117,"y":847,"width":769,"height":12}},{"id":"52aa2a27-aa31-4170-907f-7385e966fa21","block_type":"box","text":"be adversely affected. Trading suspensions in certain stocks could lead to greater market execution","page_number":392,"box":{"x":117,"y":862,"width":745,"height":12}},{"id":"3f28672f-99ca-4bbf-b5bf-ab2f8d061cfc","block_type":"box","text":"risk and costs for a Fund. The SSE and SZSE currently","page_number":392,"box":{"x":117,"y":878,"width":415,"height":12}},{"id":"d50c8b22-f47c-488e-a700-2c98d137d8ba","block_type":"box","text":"apply a daily price limit, generally set at 10%,","page_number":392,"box":{"x":533,"y":878,"width":340,"height":12}},{"id":"a9a65a34-8b13-4ffe-89ef-d4cb49d58971","block_type":"box","text":"II-60","page_number":392,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"aa2e7b39-b177-40d5-8a01-b673a112c9d0","block_type":"box","text":"NM1026U-6004382-392/605","page_number":392,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f800d985-d6c5-4332-b812-8ceec926d42e","block_type":"box","text":"of the amount of fluctuation permitted in the prices of the relevant SSE Securities and SZSE Securities","page_number":393,"box":{"x":116,"y":87,"width":766,"height":12}},{"id":"d77bc700-0387-4792-9ef4-85f0c6c841ad","block_type":"box","text":"during a single trading day. The daily price limit refers to price movements only and does not restrict","page_number":393,"box":{"x":116,"y":102,"width":747,"height":13}},{"id":"09ec7141-2328-4dac-93e2-5755c686c8af","block_type":"box","text":"trading within the relevant limit. There can be no assurance that a liquid market on an exchange will","page_number":393,"box":{"x":116,"y":118,"width":744,"height":12}},{"id":"7de79c65-1cc2-40ce-a624-c657e56457cd","block_type":"box","text":"exist for any particular SSE Security or SZSE Security or for any particular time.","page_number":393,"box":{"x":116,"y":134,"width":598,"height":12}},{"id":"8e31db03-239c-45f8-a534-317c71895fe1","block_type":"box","text":"Risk of Investing in the China Interbank Bond Market through Bond Connect.","page_number":393,"box":{"x":116,"y":165,"width":575,"height":12}},{"id":"474819dc-aa0c-4c83-9118-3a6a6b32f595","block_type":"box","text":"A Fund may invest","page_number":393,"box":{"x":691,"y":165,"width":144,"height":12}},{"id":"de971ea1-b3a6-42ad-b5c9-dc2f760534ec","block_type":"box","text":"directly in the domestic bond market in the PRC (the “China Interbank Bond Market”) through the","page_number":393,"box":{"x":116,"y":180,"width":724,"height":12}},{"id":"773eee08-67a1-4c94-8959-020a347be241","block_type":"box","text":"northbound trading of Bond Connect (“Bond Connect”). Bond Connect is an initiative launched in July","page_number":393,"box":{"x":117,"y":196,"width":755,"height":12}},{"id":"f9325f5c-3292-46c3-8f91-d67194b4ff16","block_type":"box","text":"2017 for mutual bond market access between the PRC and Hong Kong, established by the China","page_number":393,"box":{"x":116,"y":211,"width":729,"height":12}},{"id":"a1a33fd5-e01e-472e-8cd4-3dd013584742","block_type":"box","text":"Foreign Exchange Trade System & National Interbank Funding Centre (“CFETS”), China Central","page_number":393,"box":{"x":117,"y":227,"width":722,"height":12}},{"id":"cbab1baf-50f1-4682-b364-0d5f002158d7","block_type":"box","text":"Depository & Clearing Co., Ltd (“CDCC”), Shanghai Clearing House (“SCH”), Hong Kong Exchanges","page_number":393,"box":{"x":117,"y":242,"width":752,"height":12}},{"id":"d8408d3e-273b-40d8-b85e-fe4ae0d44514","block_type":"box","text":"and Clearing Limited (“HKEX”) and Central Moneymarkets Unit (“CMU”). Under the prevailing","page_number":393,"box":{"x":116,"y":258,"width":699,"height":12}},{"id":"57099f28-11fb-4a62-a4c7-3c3b91d29eed","block_type":"box","text":"regulations in the PRC, eligible foreign investors are allowed to invest in the bonds circulated in the","page_number":393,"box":{"x":117,"y":273,"width":738,"height":12}},{"id":"82d254f3-f468-4fe6-829f-8802b2a4d14a","block_type":"box","text":"China Interbank Bond Market through Bond Connect. Eligible foreign investors may submit trade","page_number":393,"box":{"x":117,"y":289,"width":721,"height":12}},{"id":"e7bc9ca1-6dbf-4827-8417-2e62b2b80c20","block_type":"box","text":"requests for bonds circulated in the China Interbank Bond Market through offshore electronic bond","page_number":393,"box":{"x":117,"y":304,"width":735,"height":12}},{"id":"1e3de3fc-9ea7-4be7-a88a-a009b8a80601","block_type":"box","text":"trading platforms (such as Tradeweb), which will in turn transmit their requests for quotation to CFETS.","page_number":393,"box":{"x":116,"y":320,"width":768,"height":12}},{"id":"0cbe08e6-5971-41bc-9346-9f78a36a22c1","block_type":"box","text":"CFETS will send the requests for quotation to a number of approved onshore dealers (including market","page_number":393,"box":{"x":117,"y":335,"width":770,"height":12}},{"id":"c20cdd8a-14b2-42c8-b3ac-79837916b8f6","block_type":"box","text":"makers and others engaged in the market making business) in the PRC. The approved onshore","page_number":393,"box":{"x":117,"y":351,"width":715,"height":12}},{"id":"832c924e-dda8-4c50-8f32-53aecd8c5561","block_type":"box","text":"dealer(s) will respond to the requests for quotation via CFETS and CFETS will send their responses to","page_number":393,"box":{"x":116,"y":366,"width":765,"height":12}},{"id":"5a3a6079-d404-4967-a930-d8d200a85721","block_type":"box","text":"those eligible foreign investors through the same offshore electronic bond trading platforms. Once the","page_number":393,"box":{"x":116,"y":382,"width":759,"height":12}},{"id":"462f7f73-1314-44a9-9360-dcc2aecc4299","block_type":"box","text":"eligible foreign investor accepts the quotation, the trade is concluded on CFETS.","page_number":393,"box":{"x":116,"y":397,"width":603,"height":12}},{"id":"efaed5c5-c355-4bc8-90fb-914b4eb80291","block_type":"box","text":"The settlement and custody of bonds traded in the China Interbank Bond Market under Bond Connect","page_number":393,"box":{"x":116,"y":428,"width":761,"height":12}},{"id":"79c022d5-5134-4e87-8417-1f53b11509c6","block_type":"box","text":"will be effected through the settlement and custody link between CMU, as an offshore custody agent,","page_number":393,"box":{"x":116,"y":444,"width":755,"height":12}},{"id":"7d4f8c2e-60e2-48f4-8f08-644fba3a6e13","block_type":"box","text":"and CDCC and SCH, as onshore custodians and clearing institutions in the PRC. Under the settlement","page_number":393,"box":{"x":116,"y":459,"width":768,"height":12}},{"id":"6ab248f6-21c5-47d4-8a06-991b883366d8","block_type":"box","text":"link, CDCC or SCH will effect gross settlement of confirmed trades onshore and CMU will process","page_number":393,"box":{"x":117,"y":475,"width":730,"height":12}},{"id":"98393694-2418-41d5-b3d2-ba67eab7edf7","block_type":"box","text":"bond settlement instructions from CMU members on behalf of eligible foreign investors in accordance","page_number":393,"box":{"x":117,"y":490,"width":757,"height":12}},{"id":"35c739b0-8392-4252-aca1-ffebb73e112c","block_type":"box","text":"with its relevant rules. Since the introduction in August 2018 of delivery versus payment (DVP)","page_number":393,"box":{"x":116,"y":506,"width":705,"height":12}},{"id":"7bb9faf1-9f8f-49f0-9f2a-8759559ee5f9","block_type":"box","text":"settlement in respect of Bond Connect, the movement of cash and securities is carried out","page_number":393,"box":{"x":116,"y":521,"width":675,"height":12}},{"id":"e368bc2e-b374-4ae7-b61a-d2bac51901cb","block_type":"box","text":"simultaneously on a real-time basis. Pursuant to the prevailing regulations in the PRC, CMU, as the","page_number":393,"box":{"x":116,"y":537,"width":743,"height":12}},{"id":"c65f67f5-323d-4784-8733-996f49559699","block_type":"box","text":"offshore custody agent recognized by the Hong Kong Monetary Authority, will open omnibus nominee","page_number":393,"box":{"x":116,"y":552,"width":759,"height":12}},{"id":"cc6bf60a-d08c-40a5-b0a6-0a362714a358","block_type":"box","text":"accounts with the onshore custody agent recognized by the People’s Bank of China (","page_number":393,"box":{"x":116,"y":568,"width":631,"height":12}},{"id":"73f19dd6-25bc-469a-ac31-0953868d2690","block_type":"box","text":"i.e.","page_number":393,"box":{"x":749,"y":568,"width":20,"height":9}},{"id":"0f557e51-bc3d-4d68-b742-b9bbc4e99de4","block_type":"box","text":", CDCC and","page_number":393,"box":{"x":772,"y":568,"width":94,"height":11}},{"id":"e48ada99-886e-4831-bf19-1e762fb3d14f","block_type":"box","text":"SCH). All bonds traded by eligible foreign investors through Bond Connect will be registered in the","page_number":393,"box":{"x":116,"y":583,"width":734,"height":12}},{"id":"d0064dde-1575-4d4f-ac43-e1f534a3088d","block_type":"box","text":"name of CMU, which will hold such bonds as a nominee owner. Therefore, a Fund will be exposed to","page_number":393,"box":{"x":117,"y":599,"width":754,"height":12}},{"id":"9a036c9a-fd60-49dd-88fa-d5634f9ecd2e","block_type":"box","text":"custody risks with respect to CMU. In the remote event of a CDCC or SCH default, CMU’s liabilities in","page_number":393,"box":{"x":116,"y":614,"width":759,"height":12}},{"id":"e5fe2c8d-0e30-4bce-9c6b-06a9ab7cdc80","block_type":"box","text":"Bond Connect bonds under its market contracts with clearing participants will be limited to assisting","page_number":393,"box":{"x":117,"y":630,"width":741,"height":12}},{"id":"417b2fe2-3da2-431a-b577-c5d93dad134c","block_type":"box","text":"clearing participants in pursuing their claims against CDCC or SCH. The Fund may suffer delay in the","page_number":393,"box":{"x":116,"y":645,"width":758,"height":12}},{"id":"6bf8b642-d494-4ed2-9912-005cff029332","block_type":"box","text":"recovery process or may not fully recover its losses from CDCC or SCH. In addition, as the relevant","page_number":393,"box":{"x":117,"y":661,"width":739,"height":12}},{"id":"006492b8-f60d-420a-bf22-bc89be1cc070","block_type":"box","text":"filings, registration with the People’s Bank of China, and account opening have to be carried out by","page_number":393,"box":{"x":116,"y":676,"width":733,"height":12}},{"id":"08175354-c6c6-43a8-be45-b6f1b38dcb7a","block_type":"box","text":"third parties, including CMU, CDCC, SCH, and CFETS, a Fund is subject to the risks of default or","page_number":393,"box":{"x":116,"y":692,"width":723,"height":12}},{"id":"8ead863d-5140-40a1-8dfe-0e307b013a55","block_type":"box","text":"errors on the part of such third parties.","page_number":393,"box":{"x":116,"y":707,"width":284,"height":12}},{"id":"4c05499d-4738-4fd8-9c87-d27f123faa5b","block_type":"box","text":"The precise nature and rights of a Fund as the benef","page_number":393,"box":{"x":116,"y":738,"width":384,"height":12}},{"id":"aed92578-749c-4ea7-94a4-5ce9157dab29","block_type":"box","text":"icial owner of the bonds traded in the China","page_number":393,"box":{"x":500,"y":738,"width":315,"height":10}},{"id":"46b4a4e3-d8cc-46a9-bcd5-49ffaa8037d1","block_type":"box","text":"Interbank Bond Market through CMU as nominee is","page_number":393,"box":{"x":117,"y":754,"width":374,"height":12}},{"id":"1658a741-2dca-4b99-ae4d-2a577f52c1a6","block_type":"box","text":"not well-defined under PRC law. There is a lack of a","page_number":393,"box":{"x":497,"y":754,"width":377,"height":9}},{"id":"b5196d22-0861-452d-a500-03f0cc16d90b","block_type":"box","text":"clear definition of, and distinction between, legal","page_number":393,"box":{"x":116,"y":769,"width":347,"height":12}},{"id":"de98c759-e37f-42b6-9ce5-e784c785b988","block_type":"box","text":"ownership and beneficial ownership under PRC law and","page_number":393,"box":{"x":469,"y":769,"width":407,"height":12}},{"id":"a322ae8e-1297-4818-9658-322671e63e29","block_type":"box","text":"there have been few cases involving a nominee account","page_number":393,"box":{"x":116,"y":785,"width":409,"height":12}},{"id":"dc0d8fca-fef3-4409-8686-c27bc437a6a5","block_type":"box","text":"structure in the PRC courts. The exact nature","page_number":393,"box":{"x":530,"y":785,"width":329,"height":9}},{"id":"94c47106-9dc0-40ca-8470-2efc2a1e0315","block_type":"box","text":"and methods of enforcement of the rights and inte","page_number":393,"box":{"x":116,"y":800,"width":363,"height":12}},{"id":"99a9e95d-ffa1-42d8-9d95-8f6c30e9262a","block_type":"box","text":"rests of a Fund under PRC law are also uncertain.","page_number":393,"box":{"x":480,"y":800,"width":363,"height":10}},{"id":"ca90cb49-f440-4461-acd8-c02bf8971e56","block_type":"box","text":"Market volatility and potential lack of liquidity due to low trading volume of certain bonds in the China","page_number":393,"box":{"x":117,"y":831,"width":750,"height":12}},{"id":"266ec85f-4915-4a5a-97d6-e13bb9534232","block_type":"box","text":"Interbank Bond Market may result in prices of certain bonds traded on such market fluctuating","page_number":393,"box":{"x":117,"y":847,"width":702,"height":12}},{"id":"56a3857d-22af-4afe-aec2-763b14130400","block_type":"box","text":"significantly. A Fund investing in such market is therefore subject to liquidity and volatility risks. The","page_number":393,"box":{"x":116,"y":862,"width":742,"height":12}},{"id":"f4616b22-05d2-4ac7-821c-9567ac9bc148","block_type":"box","text":"bid-ask spreads of the prices of such securities may be large, and a Fund may therefore incur","page_number":393,"box":{"x":117,"y":878,"width":700,"height":12}},{"id":"1bedb572-4ea2-4606-a282-c41749edb29a","block_type":"box","text":"II-61","page_number":393,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"d39d0e6d-de56-460e-bd27-23ec5c91eec2","block_type":"box","text":"NM1026U-6004382-393/605","page_number":393,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"31bc6d7d-2a6d-492e-83be-67a62bdb6e89","block_type":"box","text":"significant costs and may suffer losses when selling such investments. The bonds traded in the China","page_number":394,"box":{"x":116,"y":87,"width":759,"height":12}},{"id":"82289a9f-2d88-40f8-b083-175e99233984","block_type":"box","text":"Interbank Bond Market may be difficult or impossible to sell, which may impact a Fund’s ability to","page_number":394,"box":{"x":117,"y":102,"width":722,"height":13}},{"id":"f168fa19-46c0-424c-98db-673dd7ec9fd4","block_type":"box","text":"acquire or dispose of such securities at their expected prices.","page_number":394,"box":{"x":116,"y":118,"width":460,"height":12}},{"id":"cf2001c3-c627-475e-a927-ec1bf8bc62fb","block_type":"box","text":"Investing in the China Interbank Bond Market through Bond Connect is also subject to regulatory risks.","page_number":394,"box":{"x":117,"y":150,"width":766,"height":12}},{"id":"ab917c30-a0c7-4660-bcbe-4b2839e97f74","block_type":"box","text":"The relevant rules and regulations are subject to change, which may have potential retrospective","page_number":394,"box":{"x":116,"y":166,"width":724,"height":12}},{"id":"44510f17-843d-44d1-b2e9-ea69ffa1bbac","block_type":"box","text":"effect, and there can be no assurance that Bond Connect will not be discontinued or abolished.","page_number":394,"box":{"x":116,"y":181,"width":711,"height":11}},{"id":"d2ce1870-c14a-4770-8c97-c8a00fe7d330","block_type":"box","text":"Furthermore, the securities regimes and legal systems of China and Hong Kong differ significantly and","page_number":394,"box":{"x":117,"y":196,"width":764,"height":13}},{"id":"89a01763-ffde-47c5-abe8-53184f5de7ec","block_type":"box","text":"issues may arise based on these differences. In the event that the relevant authorities suspend","page_number":394,"box":{"x":117,"y":212,"width":709,"height":12}},{"id":"27f0fc28-8d5a-4dab-b3d5-68d577f23eca","block_type":"box","text":"account opening or trading on the China Interbank Bond Market, a Fund’s ability to invest in the China","page_number":394,"box":{"x":116,"y":227,"width":762,"height":13}},{"id":"8e2952ca-b125-42dc-9561-27914ce99eda","block_type":"box","text":"Interbank Bond Market will be adversely affected and limited. In such event, the Fund’s ability to","page_number":394,"box":{"x":117,"y":243,"width":716,"height":12}},{"id":"0d57e504-c6a8-4071-a1f3-7b9b3653f849","block_type":"box","text":"achieve its investment objective will be negatively affected and, after exhausting other trading","page_number":394,"box":{"x":116,"y":259,"width":699,"height":12}},{"id":"7dc29fd0-506b-4e83-901f-a1dcaf9b0d2a","block_type":"box","text":"alternatives, the Fund may suffer substantial losses as a result. Further, if Bond Connect is not","page_number":394,"box":{"x":116,"y":274,"width":707,"height":12}},{"id":"8550fe41-8fa6-4c71-a024-ace29c42df6d","block_type":"box","text":"operating, a Fund may not be able to acquire or dispose of bonds through Bond Connect in a timely","page_number":394,"box":{"x":116,"y":290,"width":745,"height":12}},{"id":"ec31d585-9386-46ca-97e3-05831781a3e6","block_type":"box","text":"manner, which could adversely affect the Fund’s performance.","page_number":394,"box":{"x":117,"y":305,"width":467,"height":12}},{"id":"b9c7e3a1-0fae-45e8-b9f4-fbf8cdd3f397","block_type":"box","text":"Trading through Bond Connect is performed through newly developed trading platforms and","page_number":394,"box":{"x":116,"y":337,"width":687,"height":12}},{"id":"632b3068-a7ca-4f3c-bbe5-f931f96b3a5a","block_type":"box","text":"operational systems. There is no assurance that such systems will function properly or will continue to","page_number":394,"box":{"x":116,"y":352,"width":761,"height":13}},{"id":"7ed81cfd-a51e-4aee-9905-ea4ed69eda57","block_type":"box","text":"be adapted to changes and developments in the market. In the event that the relevant systems fail to","page_number":394,"box":{"x":117,"y":368,"width":753,"height":12}},{"id":"03b87a8a-7170-43c4-8aaf-515fc3a6a463","block_type":"box","text":"function properly, trading through Bond Connect may be disrupted. A Fund’s ability to trade through","page_number":394,"box":{"x":116,"y":384,"width":744,"height":12}},{"id":"67044d77-f220-4fb8-88d2-b96099837fc1","block_type":"box","text":"Bond Connect (and hence to pursue its investment strategy) may therefore be adversely affected. In","page_number":394,"box":{"x":117,"y":399,"width":749,"height":12}},{"id":"886daea0-7257-4773-83b6-2c94231ce9ab","block_type":"box","text":"addition, where a Fund invests in the China Interbank Bond Market through Bond Connect, it may be","page_number":394,"box":{"x":116,"y":415,"width":753,"height":12}},{"id":"211aaa55-1a2b-496e-922c-aa1cff543441","block_type":"box","text":"subject to risks of delays inherent in the order placing and/or settlement systems.","page_number":394,"box":{"x":116,"y":430,"width":607,"height":12}},{"id":"be9fc2c8-61be-400b-9205-bfc2a3a80775","block_type":"box","text":"Bond Connect trades are settled in Chinese currency, the RMB, which is currently restricted and not","page_number":394,"box":{"x":117,"y":462,"width":746,"height":12}},{"id":"554661ef-ab95-4976-9421-78587a724d63","block_type":"box","text":"freely convertible. As a result, a Fund will be exposed to currency risk, and it cannot be guaranteed","page_number":394,"box":{"x":116,"y":477,"width":740,"height":13}},{"id":"8373c7e0-f683-4c04-a230-0b461b3e317d","block_type":"box","text":"that investors will have timely access to a reliable supply of RMB.","page_number":394,"box":{"x":116,"y":493,"width":490,"height":12}},{"id":"ae9d78ec-6c61-490c-bcea-20858fa3f9c9","block_type":"box","text":"Tax Risk — Withholding Income Tax Risk.","page_number":394,"box":{"x":118,"y":525,"width":317,"height":12}},{"id":"f1d6f60a-1e1e-4933-8134-036468514a0f","block_type":"box","text":"According to PRC tax regulations, a 10% withholding income tax is imposed on PRC sourced","page_number":394,"box":{"x":116,"y":549,"width":697,"height":12}},{"id":"9b9992fa-3b9c-4e84-9dde-a814c88e7e88","block_type":"box","text":"dividends and interests from non-government bonds paid to a non-PRC tax resident enterprise, unless","page_number":394,"box":{"x":116,"y":564,"width":765,"height":12}},{"id":"98b4f1af-07bd-4594-8ceb-1776cae2f84b","block_type":"box","text":"the rate is reduced under an applicable tax treaty. From a technical perspective, withholding income","page_number":394,"box":{"x":116,"y":580,"width":746,"height":12}},{"id":"4ebece2c-09ce-407b-a569-264691c8749a","block_type":"box","text":"tax is also applicable to capital gains realized by foreign investors on the disposal of PRC equity","page_number":394,"box":{"x":116,"y":595,"width":717,"height":12}},{"id":"9c80a6ad-54d6-4054-8390-8e5f1386f95e","block_type":"box","text":"interests.","page_number":394,"box":{"x":117,"y":611,"width":72,"height":9}},{"id":"a378e149-8b53-4c4c-bf5f-eaf43d4d6cdd","block_type":"box","text":"There are however certain tax exemptions available, some temporary in nature, highlighted below.","page_number":394,"box":{"x":116,"y":643,"width":735,"height":12}},{"id":"f55f6a6c-988b-4599-b084-c19e999a8408","block_type":"box","text":"On November 14, 2014, the Ministry of Finance (“MoF”), China Securities Regulatory Commission and","page_number":394,"box":{"x":116,"y":675,"width":761,"height":12}},{"id":"852635b6-3d69-4060-92de-3fe8e187b661","block_type":"box","text":"the State Taxation Administration (“STA”), acting with State Council’s approval, jointly released","page_number":394,"box":{"x":116,"y":690,"width":703,"height":12}},{"id":"fe9b4f9b-ff77-4321-964a-0bfb4a0b43b5","block_type":"box","text":"Circular 79, which temporarily exempts Qualified Foreign Institutional Investors (“QFIIs”) and Renminbi","page_number":394,"box":{"x":117,"y":706,"width":760,"height":12}},{"id":"eeaf3516-86c9-4b03-bda8-3fb159d86da6","block_type":"box","text":"Qualified Foreign Institutional Investors (“RQFIIs”) from tax on capital gains derived from the trading","page_number":394,"box":{"x":116,"y":721,"width":740,"height":12}},{"id":"ca3991df-ba6f-45eb-9eea-3c257fdd0fdf","block_type":"box","text":"of shares and other equity interest investments on or after November 17, 2014. Subsequently,","page_number":394,"box":{"x":116,"y":737,"width":698,"height":12}},{"id":"872b043b-dba2-46ce-8732-590fe06de615","block_type":"box","text":"Circulars 81 and 127 were issued to temporarily exempt tax on capital gains derived from trading of","page_number":394,"box":{"x":117,"y":752,"width":738,"height":12}},{"id":"4ea456d2-8b76-4452-b94d-b6d2b029c970","block_type":"box","text":"equity securities of companies domiciled in the PRC that trade on Chinese stock exchanges","page_number":394,"box":{"x":116,"y":768,"width":682,"height":12}},{"id":"7da4b3f1-3faa-4ddc-9530-b4603759c0c2","block_type":"box","text":"(“A-Shares”) through the Shanghai-Hong Kong Stock Connect program or the Shenzhen-Hong Kong","page_number":394,"box":{"x":117,"y":783,"width":745,"height":12}},{"id":"c3e5746e-acc7-4433-ad4a-9a7c769ecc92","block_type":"box","text":"Stock Connect program, as applicable (each, a “Stock Connect” and collectively, “Stock Connects”).","page_number":394,"box":{"x":116,"y":799,"width":741,"height":12}},{"id":"52c67e05-348e-43cd-829f-fba459b812e7","block_type":"box","text":"The duration of the temporary exemptions is not stated in the circulars and is subject to termination by","page_number":394,"box":{"x":116,"y":814,"width":758,"height":12}},{"id":"3748b7b8-caa0-471e-ba7e-2e122a9d2acb","block_type":"box","text":"the PRC tax authorities with or without notice.","page_number":394,"box":{"x":116,"y":830,"width":344,"height":9}},{"id":"0b687cc9-cf68-46c0-a85f-257411cdf701","block_type":"box","text":"On November 22, 2018, the MoF and STA jointly issued Circular 108 which states that foreign","page_number":394,"box":{"x":116,"y":862,"width":703,"height":12}},{"id":"11bd9d36-c872-4aeb-b9f8-05a2e71b9b28","block_type":"box","text":"institutional investors are temporarily exempt from withholding income tax with respect to interest","page_number":394,"box":{"x":117,"y":877,"width":723,"height":12}},{"id":"72995c3b-3eeb-41c3-b8fe-423f5a3f6116","block_type":"box","text":"II-62","page_number":394,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"c979a0fa-e357-4d7b-ab80-1952b19b97ad","block_type":"box","text":"NM1026U-6004382-394/605","page_number":394,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"103d4c7f-217c-41a8-8d1c-604bbd057329","block_type":"box","text":"income on bonds derived from the PRC bond market from November 7, 2018 to November 6, 2021.","page_number":395,"box":{"x":117,"y":87,"width":745,"height":11}},{"id":"65fa7157-59a4-462a-9b6e-337000964dd3","block_type":"box","text":"On November 22, 2021, the MoF and STA issued Public Notice 34 to extend the temporary exemption","page_number":395,"box":{"x":116,"y":102,"width":765,"height":13}},{"id":"e40112e2-d80a-4957-ad2e-9029a49073c5","block_type":"box","text":"from November 7, 2021 to December 31, 2025. On January 15, 2026, it was announced via Public","page_number":395,"box":{"x":116,"y":118,"width":736,"height":12}},{"id":"9dc1f0cf-cde8-412b-8b77-84207c8ed305","block_type":"box","text":"Notice No. 5 of 2026 that the exemption was extended through December 31, 2027.","page_number":395,"box":{"x":117,"y":134,"width":628,"height":12}},{"id":"770e362a-9fb2-4f09-91fb-d33e73f305b1","block_type":"box","text":"Value Added Tax (“VAT”) Risk —","page_number":395,"box":{"x":118,"y":165,"width":250,"height":12}},{"id":"7da4a290-c558-4fe3-ab40-f35b4a29f702","block_type":"box","text":"From May 1, 2016, VAT applies to certain income derived by the","page_number":395,"box":{"x":370,"y":165,"width":483,"height":12}},{"id":"c8e32d23-cd7c-411c-a174-5d8412e06813","block_type":"box","text":"Fund, including PRC sourced interest income on non-government bonds and trading gains.","page_number":395,"box":{"x":117,"y":180,"width":674,"height":12}},{"id":"d600443b-8fcb-44f1-b472-126680eba8d1","block_type":"box","text":"There are however certain tax exemptions available, some temporary in nature, highlighted below.","page_number":395,"box":{"x":116,"y":211,"width":735,"height":12}},{"id":"d68cfad0-fbfb-4d85-98f9-3d4aa7d2e683","block_type":"box","text":"VAT exemptions currently apply to capital gains from trading of QFII and RQFII products, A-Shares","page_number":395,"box":{"x":116,"y":242,"width":741,"height":12}},{"id":"d41d9226-8c11-4357-aca2-557077d1e8bc","block_type":"box","text":"traded on the Stock Connects and debt securities traded in the China Interbank Bond Market.","page_number":395,"box":{"x":116,"y":258,"width":699,"height":9}},{"id":"a910c034-f0b3-451e-88ce-90b8f8be9a05","block_type":"box","text":"On November 7, 2018, the MoF and STA jointly issued Circular 108 which states that foreign","page_number":395,"box":{"x":116,"y":289,"width":694,"height":12}},{"id":"f7fdd411-012d-4bf9-842b-a2b8541a81d4","block_type":"box","text":"institutional investors are temporarily exempt from VAT with respect to interest income on bonds","page_number":395,"box":{"x":117,"y":304,"width":718,"height":12}},{"id":"09c63e3c-58d6-4d9b-a187-ab5dcc8cdce7","block_type":"box","text":"derived from the PRC bond market from November 7, 2018 to November 6, 2021. On November 22,","page_number":395,"box":{"x":116,"y":320,"width":750,"height":11}},{"id":"ae021444-bffb-4603-943b-6e3eb3530d76","block_type":"box","text":"2021, the MoF and STA jointly issued Public Notice 34 to extend the temporary exemption from","page_number":395,"box":{"x":116,"y":335,"width":714,"height":12}},{"id":"ff0c9e3b-08cd-4bde-9604-dd09055e7fcc","block_type":"box","text":"November 7, 2021 to December 31, 2025. However, on July 31, 2025, the MoF and STA jointly issued","page_number":395,"box":{"x":117,"y":351,"width":764,"height":12}},{"id":"48c6a310-cbd5-48e8-9c73-ec389bd5ab77","block_type":"box","text":"Public Notice No 4 of 2025, stating that VAT will apply with respect to interest income derived from","page_number":395,"box":{"x":117,"y":366,"width":735,"height":12}},{"id":"7dab7047-eab5-412c-87e4-c39fda89073d","block_type":"box","text":"treasury bonds, local government bonds and financial bonds issued on or after August 8, 2025. It is","page_number":395,"box":{"x":116,"y":382,"width":742,"height":12}},{"id":"22aa9b92-d34d-40ef-9836-46dc3bd44243","block_type":"box","text":"understood that Public Notice No 4 of 2025 does not supersede the afore-mentioned exemption for","page_number":395,"box":{"x":117,"y":397,"width":739,"height":12}},{"id":"1f7f8fd6-b406-44a2-baf1-f04fb24c1fa9","block_type":"box","text":"foreign institutional investors. This exemption was extended through December 31, 2027.","page_number":395,"box":{"x":116,"y":413,"width":668,"height":12}},{"id":"36e6f2a2-cc69-4981-bf3a-2a490dd48ed3","block_type":"box","text":"Any changes in PRC tax law, future clarifications thereof, and/or subsequent retroactive enforcement","page_number":395,"box":{"x":116,"y":444,"width":754,"height":12}},{"id":"41acbc82-b83b-4573-90d4-2814d3ffa5ec","block_type":"box","text":"by the PRC tax authorities may result in a loss which could be material to the Fund. There is a risk the","page_number":395,"box":{"x":117,"y":459,"width":761,"height":12}},{"id":"8c32cd09-4cfe-477f-9920-c32b0d84bced","block_type":"box","text":"PRC tax authorities may withdraw the temporary tax exemptions in the future and seek to collect taxes","page_number":395,"box":{"x":117,"y":475,"width":765,"height":12}},{"id":"f3280add-1ab4-4ed5-a952-8bc9c4fea21d","block_type":"box","text":"realized on the sale of A-Shares or PCR sourced interest income on non-government bonds received","page_number":395,"box":{"x":117,"y":490,"width":756,"height":12}},{"id":"4f610350-884e-4764-ad96-4d683fb4f9b5","block_type":"box","text":"by the Fund without giving any prior notice. If the temporary tax exemptions are withdrawn, any taxes","page_number":395,"box":{"x":117,"y":506,"width":755,"height":12}},{"id":"8cab9679-d635-42c3-8a17-702680f00170","block_type":"box","text":"may be directly borne by or indirectly passed on to the Fund and may result in a substantial impact to","page_number":395,"box":{"x":117,"y":521,"width":755,"height":12}},{"id":"a164477a-2340-4e1f-9e56-8c3c1e62e8ff","block_type":"box","text":"its net asset value. As with any net asset value adjustment, investors may be advantaged or","page_number":395,"box":{"x":117,"y":537,"width":687,"height":12}},{"id":"9292e4e2-2cdc-4e73-9bc7-5ff7fbd7edf4","block_type":"box","text":"disadvantaged depending on when the investors purchased and/or sold the shares of the Fund. There","page_number":395,"box":{"x":116,"y":552,"width":763,"height":12}},{"id":"12442c09-bfad-4d3d-944e-f10b26e4b359","block_type":"box","text":"will be no retrospective restatement of the Fund’s net asset value.","page_number":395,"box":{"x":116,"y":568,"width":494,"height":12}},{"id":"f961d17b-c663-4965-be4b-3eaea88eff06","block_type":"box","text":"BlackRock will keep the provisioning policy for tax liability under review and may, in its discretion from","page_number":395,"box":{"x":117,"y":599,"width":758,"height":12}},{"id":"a9529500-8d6f-4eeb-ba72-7b18faed595d","block_type":"box","text":"time to time, make a provision for potential tax liabilities if in its opinion such provision is warranted or","page_number":395,"box":{"x":116,"y":614,"width":756,"height":12}},{"id":"ab14a4ec-9cd6-4df8-a949-2ded7460b113","block_type":"box","text":"as further clarified by the PRC in notifications.","page_number":395,"box":{"x":116,"y":630,"width":345,"height":12}},{"id":"59fe0889-55e7-4af1-aaf6-0b900f6513a4","block_type":"box","text":"Investment in Other Investment Companies.","page_number":395,"box":{"x":116,"y":661,"width":350,"height":12}},{"id":"f9dd4a8b-6da9-4d1e-9f20-689d29b2fcf1","block_type":"box","text":"Each Fund may, subject to applicable law, invest in","page_number":395,"box":{"x":474,"y":661,"width":378,"height":12}},{"id":"d90bb543-03c5-4b01-96d4-e1d9e54494f7","block_type":"box","text":"other investment companies (including investment companies managed by BlackRock and its","page_number":395,"box":{"x":116,"y":676,"width":694,"height":12}},{"id":"03124654-6135-4e11-8a60-1f291036207c","block_type":"box","text":"affiliates), including money market funds and ETFs, which are typically open-end funds or unit","page_number":395,"box":{"x":116,"y":692,"width":697,"height":12}},{"id":"3309c6a2-2871-4f38-ac4e-8eb4ee7cc2d4","block_type":"box","text":"investment trusts listed on a stock exchange. Under Section 12(d)(1)(A) of the Investment Company","page_number":395,"box":{"x":117,"y":707,"width":743,"height":12}},{"id":"ac921e88-88e7-459f-9515-8c6b848757ed","block_type":"box","text":"Act, however, a Fund may invest up to 10% of its total assets in securities of other investment","page_number":395,"box":{"x":116,"y":723,"width":696,"height":12}},{"id":"51cea88f-27d1-4e60-81dc-94f60096e1ba","block_type":"box","text":"companies (measured at the time of such investment). In addition, under Section 12(d)(1)(A) of the","page_number":395,"box":{"x":116,"y":738,"width":734,"height":12}},{"id":"d6233276-dbaa-4428-b700-f5c8be3a1ecd","block_type":"box","text":"Investment Company Act a Fund may not acquire securities of an investment company if such","page_number":395,"box":{"x":117,"y":754,"width":698,"height":12}},{"id":"7c78f818-d0d4-4fd5-b809-198496dd49ee","block_type":"box","text":"acquisition would cause the Fund to own more than 3% of the total outstanding voting stock of such","page_number":395,"box":{"x":116,"y":769,"width":739,"height":12}},{"id":"ae3d62ee-d194-44fa-b179-a16241f322d0","block_type":"box","text":"investment company and a Fund may not invest in another investment company if such investment","page_number":395,"box":{"x":117,"y":785,"width":734,"height":12}},{"id":"25020760-dfcc-43ee-bf9a-c04d305e5f04","block_type":"box","text":"would cause more than 5% of the value of the Fund’s total assets to be invested in securities of such","page_number":395,"box":{"x":116,"y":800,"width":747,"height":10}},{"id":"3c66544c-3fc9-474f-a1ac-cb5acfa4d7db","block_type":"box","text":"investment company. (These limits do not restrict a Feeder Fund from investing all of its assets in","page_number":395,"box":{"x":117,"y":816,"width":721,"height":12}},{"id":"359086e0-2528-4b2d-aa8b-243d6f56f619","block_type":"box","text":"shares of its Master Portfolio.) In addition to the restrictions on investing in other investment companies","page_number":395,"box":{"x":116,"y":831,"width":771,"height":12}},{"id":"039f0c69-2783-4e7c-bcb0-67d0995f443a","block_type":"box","text":"discussed above, under Section 12(d)(1)(C) of the Investment Company Act a Fund may not invest in","page_number":395,"box":{"x":116,"y":847,"width":759,"height":12}},{"id":"bc5814f0-fd36-4a95-b944-27965ee5f32a","block_type":"box","text":"a registered closed-end investment company if such investment would cause the Fund and other","page_number":395,"box":{"x":116,"y":862,"width":724,"height":12}},{"id":"a38bda42-e3cb-4442-b446-7122f091de5c","block_type":"box","text":"BlackRock-advised investment companies to own more than 10% of the total outstanding voting stock","page_number":395,"box":{"x":117,"y":878,"width":760,"height":12}},{"id":"e1097e54-a154-4168-9b00-4ea218444ce0","block_type":"box","text":"II-63","page_number":395,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"2543d682-881d-4100-a17c-5849492ab3b9","block_type":"box","text":"NM1026U-6004382-395/605","page_number":395,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5fc5fd2b-32e3-48ca-acd3-77fc77a617bc","block_type":"box","text":"of such closed-end investment company. Pursuant to Section 12(d)(1)(G) of the Investment Company","page_number":396,"box":{"x":116,"y":87,"width":761,"height":12}},{"id":"00eef9ee-aa92-49d7-9d3d-4542b4710e26","block_type":"box","text":"Act, these percentage limitations do not apply to investments in affiliated investment companies,","page_number":396,"box":{"x":116,"y":102,"width":719,"height":13}},{"id":"fbabb7f3-009b-4bd9-91df-b9668f3c62e0","block_type":"box","text":"including ETFs, subject to certain conditions. In addition, a Fund may be able to rely on certain rules","page_number":396,"box":{"x":117,"y":118,"width":747,"height":12}},{"id":"b97941c4-2707-4751-98c1-24aecf2218ad","block_type":"box","text":"under the Investment Company Act to invest in shares of money market funds or other investment","page_number":396,"box":{"x":117,"y":134,"width":733,"height":12}},{"id":"f55e5546-fea2-4ecc-a42e-0a1d5610c503","block_type":"box","text":"companies beyond the statutory limits noted above, but subject to certain conditions.","page_number":396,"box":{"x":116,"y":149,"width":633,"height":12}},{"id":"168ca5eb-2e08-4953-b6e5-981910f1a5c1","block_type":"box","text":"As with other investments, investments in other investment companies are subject to market and","page_number":396,"box":{"x":116,"y":177,"width":723,"height":12}},{"id":"8544dfa3-c96c-44a4-a2c4-ca8011b37ac4","block_type":"box","text":"selection risk.","page_number":396,"box":{"x":116,"y":192,"width":106,"height":10}},{"id":"fc078da1-4826-4955-a856-0766bd866571","block_type":"box","text":"Shares of investment companies, such as closed-end fund investment companies, that trade on an","page_number":396,"box":{"x":116,"y":220,"width":740,"height":12}},{"id":"851145b1-9a2e-4510-94f1-c657ea19ede9","block_type":"box","text":"exchange may at times be acquired at market prices representing premiums to their NAVs. In addition,","page_number":396,"box":{"x":116,"y":236,"width":767,"height":12}},{"id":"658f071f-adfc-407f-bc38-cef1aeab64e6","block_type":"box","text":"investment companies held by a Fund that trade on an exchange could trade at a discount from NAV,","page_number":396,"box":{"x":117,"y":251,"width":758,"height":12}},{"id":"95ae7725-f6ef-46a5-a7ec-35c02fa73dab","block_type":"box","text":"and such discount could increase while the Fund holds the shares. If the market price of shares of an","page_number":396,"box":{"x":116,"y":267,"width":756,"height":12}},{"id":"5489b3d8-2872-4222-a556-12ff21d5094d","block_type":"box","text":"exchange-traded investment company decreases below the price that the Fund paid for the shares and","page_number":396,"box":{"x":116,"y":282,"width":771,"height":12}},{"id":"b0b49de4-14d9-4ca3-826e-d872e3750954","block_type":"box","text":"the Fund were to sell its shares of such investment company at a time when the market price is lower","page_number":396,"box":{"x":116,"y":298,"width":757,"height":12}},{"id":"f012ab39-6120-4829-958d-3cf73bde7b20","block_type":"box","text":"than the price at which it purchased the shares, the Fund would experience a loss.","page_number":396,"box":{"x":116,"y":313,"width":617,"height":12}},{"id":"9cefdb2e-5e0d-4621-a503-9e816ce8f249","block_type":"box","text":"In addition, if a Fund acquires shares in investment companies, including affiliated investment","page_number":396,"box":{"x":117,"y":341,"width":698,"height":12}},{"id":"99626144-c591-4c17-97cf-64b07dcd1796","block_type":"box","text":"companies, shareholders would bear both their proportionate share of expenses in the Fund and,","page_number":396,"box":{"x":116,"y":356,"width":727,"height":12}},{"id":"bcbc24dd-39f1-4d31-b827-c04adf52771f","block_type":"box","text":"indirectly, the expenses of such investment companies. Such expenses, both at the Fund level and","page_number":396,"box":{"x":117,"y":371,"width":739,"height":12}},{"id":"a8f4e973-ea38-4331-9bed-9f1029fe9043","block_type":"box","text":"acquired investment company level, would include management and advisory fees, unless such fees","page_number":396,"box":{"x":116,"y":386,"width":753,"height":12}},{"id":"43f1cbf5-9880-40a4-9136-e24955db78ab","block_type":"box","text":"have been waived by BlackRock. Please see the relevant Fund’s Prospectus to determine whether any","page_number":396,"box":{"x":117,"y":402,"width":769,"height":12}},{"id":"d01199c6-e953-4715-9e83-14ab143b62ad","block_type":"box","text":"such management and advisory fees have been waived by BlackRock. Investments by a Fund in","page_number":396,"box":{"x":116,"y":417,"width":724,"height":12}},{"id":"7c7afcb4-3212-421b-af43-e7417672b91e","block_type":"box","text":"wholly owned investment entities created under the laws of certain countries will not be deemed an","page_number":396,"box":{"x":116,"y":432,"width":740,"height":12}},{"id":"7507166c-6e09-4db8-b809-efcfc84aa5a8","block_type":"box","text":"investment in other investment companies. Pursuant to guidance issued by the staff of the","page_number":396,"box":{"x":117,"y":447,"width":674,"height":12}},{"id":"e82e4ebb-00db-4e09-98f7-76866cc07b77","block_type":"box","text":"Commission, fees and expenses of money market funds used for the investment of cash collateral","page_number":396,"box":{"x":117,"y":463,"width":733,"height":12}},{"id":"bc85f8b2-b702-4b4f-aabc-858ff81ca729","block_type":"box","text":"received in connection with loans of Fund securities are not treated as “acquired fund fees and","page_number":396,"box":{"x":117,"y":478,"width":706,"height":12}},{"id":"90927109-677f-4e17-b5c6-e4f5b4b9495f","block_type":"box","text":"expenses,” which are fees and expenses charged by other investment companies and pooled","page_number":396,"box":{"x":116,"y":493,"width":701,"height":12}},{"id":"788cdbfd-f31c-4c21-ae7f-138132dfad9c","block_type":"box","text":"investment vehicles in which a Fund invests a portion of its assets.","page_number":396,"box":{"x":117,"y":508,"width":498,"height":12}},{"id":"85d69111-a1a8-45ce-b6c2-3c81da5e47e8","block_type":"box","text":"To the extent shares of a Fund are held by another f","page_number":396,"box":{"x":116,"y":536,"width":380,"height":12}},{"id":"5b5e5a1f-60a3-470d-87a1-77c94f1a5fe4","block_type":"box","text":"und, the ability of the Fund it","page_number":396,"box":{"x":497,"y":536,"width":205,"height":12}},{"id":"b48bdc41-5819-4c25-9f15-43c87b20ae52","block_type":"box","text":"self to purchase other","page_number":396,"box":{"x":702,"y":536,"width":163,"height":12}},{"id":"06ebce5a-40c3-423c-bc09-90f706c2e89c","block_type":"box","text":"funds may be limited. In addition, a fund-of-funds (","page_number":396,"box":{"x":116,"y":551,"width":365,"height":12}},{"id":"9c9ac908-9c3b-41ee-8346-0f470c479a19","block_type":"box","text":"e.g.","page_number":396,"box":{"x":482,"y":554,"width":25,"height":9}},{"id":"b646630a-4790-4ddd-ad8c-7e5bcb758bb9","block_type":"box","text":", an investment company that seeks to meet its","page_number":396,"box":{"x":510,"y":551,"width":347,"height":12}},{"id":"805d1f1f-33ed-46c8-a414-b4b8f858b3d8","block_type":"box","text":"investment objective by investing significantly in","page_number":396,"box":{"x":117,"y":566,"width":350,"height":12}},{"id":"8e67c83c-f7a3-493c-ab76-aab145ed3db0","block_type":"box","text":"other investment companies)","page_number":396,"box":{"x":468,"y":566,"width":215,"height":12}},{"id":"e9d11a45-0d7f-4e85-9cc4-1660c8e238ea","block_type":"box","text":"may be limited in its ability","page_number":396,"box":{"x":684,"y":566,"width":195,"height":12}},{"id":"b3dd9325-a8ea-4f86-9579-c053fc894336","block_type":"box","text":"to purchase underlying funds if such underlying f","page_number":396,"box":{"x":116,"y":582,"width":353,"height":12}},{"id":"7daa53a9-97d2-494f-82ea-498b1ac580aa","block_type":"box","text":"unds themselves own shares of underlying funds.","page_number":396,"box":{"x":470,"y":582,"width":364,"height":12}},{"id":"f9a7b098-d51a-4b73-a18b-ed6e0b695e1a","block_type":"box","text":"A number of publicly traded closed-end investment companies have been organized to facilitate","page_number":396,"box":{"x":116,"y":609,"width":715,"height":12}},{"id":"6b82fab1-3d4f-4520-97d4-a8edeedbe01f","block_type":"box","text":"indirect foreign investment in developing countries, and certain of such countries, such as Thailand,","page_number":396,"box":{"x":117,"y":624,"width":743,"height":12}},{"id":"381b7d33-55ac-4b7c-889f-ec50d6b8849e","block_type":"box","text":"South Korea, Chile and Brazil, have specifically authorized such funds. There also are investment","page_number":396,"box":{"x":116,"y":640,"width":730,"height":12}},{"id":"286ac7f2-fba2-4b0b-8bab-0ae49e05a9c4","block_type":"box","text":"opportunities in certain of such countries in pooled vehicles that resemble open-end investment","page_number":396,"box":{"x":116,"y":655,"width":713,"height":12}},{"id":"0d55f57d-5999-4cdd-89cf-fb0130249326","block_type":"box","text":"companies. The restrictions on investments in securities of investment companies set forth above may","page_number":396,"box":{"x":116,"y":670,"width":760,"height":12}},{"id":"31dd3d97-5e99-4898-ab8c-0f43f096b89a","block_type":"box","text":"limit opportunities for a Fund to invest indirectly in certain developing countries.","page_number":396,"box":{"x":117,"y":685,"width":585,"height":12}},{"id":"b469d03c-313c-432b-b1bc-9d0dfe2e540f","block_type":"box","text":"Issuer Insolvency Risk.","page_number":396,"box":{"x":116,"y":713,"width":185,"height":12}},{"id":"f53829ea-e9b5-4a42-b9a5-adaa72bcea16","block_type":"box","text":"Certain Funds’ potential exposure to financially or operationally troubled","page_number":396,"box":{"x":307,"y":713,"width":532,"height":12}},{"id":"ff11899e-01b8-4a67-9ef9-8abf660a65d2","block_type":"box","text":"issuers involves a high degree of credit and market risk, which may be heightened during an economic","page_number":396,"box":{"x":117,"y":728,"width":761,"height":12}},{"id":"2258c9c4-a711-4381-850b-b5407cf04cc0","block_type":"box","text":"downturn or recession. Should an issuer of securities held by a Fund become involved in a bankruptcy","page_number":396,"box":{"x":116,"y":743,"width":760,"height":12}},{"id":"304bc109-c51e-4e36-a963-66ff96acecd6","block_type":"box","text":"proceeding, reorganization or financial restructuring, a wide variety of considerations make an","page_number":396,"box":{"x":117,"y":759,"width":695,"height":12}},{"id":"0b33e068-8f0c-4293-9db2-5b9588c0eb8d","block_type":"box","text":"evaluation of the outcome of the Fund’s exposure to the issuer uncertain.","page_number":396,"box":{"x":116,"y":774,"width":542,"height":12}},{"id":"88767347-4254-45f5-af75-75eaeca116bc","block_type":"box","text":"During the period of a bankruptcy proceeding, reorganization or financial restructuring, it is unlikely that","page_number":396,"box":{"x":117,"y":801,"width":764,"height":12}},{"id":"9d9521a5-ff07-451c-a12f-ee938e0b7da1","block_type":"box","text":"a Fund will receive any interest payments on the securities of the issuer. A Fund will be subject to","page_number":396,"box":{"x":116,"y":817,"width":723,"height":12}},{"id":"f7d6d761-6df5-4c0c-b3b4-2627995bdbba","block_type":"box","text":"significant uncertainty as to whether the reorganization or restructuring will be completed, and the Fund","page_number":396,"box":{"x":116,"y":832,"width":772,"height":12}},{"id":"a16c2ce4-1b83-4b6f-99bc-369e4a859ba0","block_type":"box","text":"may bear certain extraordinary expenses to protect and recover its investment. A Fund will also be","page_number":396,"box":{"x":117,"y":847,"width":735,"height":12}},{"id":"a7bf9932-508b-4971-8aa7-1b82775bef0d","block_type":"box","text":"subject to significant uncertainty as to when and in what manner and for what value the obligations","page_number":396,"box":{"x":116,"y":862,"width":737,"height":12}},{"id":"a3ad1f38-a63f-4cc1-8bbd-c04153bc314f","block_type":"box","text":"evidenced by the securities of the issuer held by the Fund will eventually be satisfied.","page_number":396,"box":{"x":116,"y":878,"width":637,"height":12}},{"id":"04079171-5770-4e49-90e1-0c2160138e44","block_type":"box","text":"II-64","page_number":396,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"6294f74e-7172-4987-837a-25388f8870cf","block_type":"box","text":"NM1026U-6004382-396/605","page_number":396,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ac099a8a-ad41-48d3-95fd-197a2d5fda52","block_type":"box","text":"Even if a plan of reorganization or restructuring is adopted with respect to the securities of the issuer","page_number":397,"box":{"x":117,"y":87,"width":741,"height":12}},{"id":"abb4af33-522f-419b-b89a-0ca6eab17cad","block_type":"box","text":"held by the Fund, there can be no assurance that the securities or other assets received by a Fund in","page_number":397,"box":{"x":117,"y":102,"width":748,"height":12}},{"id":"6025de88-316f-48e8-8684-75edc3fe0f1f","block_type":"box","text":"connection with such plan of reorganization or restructuring will not have a lower value or income","page_number":397,"box":{"x":116,"y":117,"width":717,"height":12}},{"id":"abc627a6-b3c9-4fed-bd84-79ff3e879aa2","block_type":"box","text":"potential than may have been anticipated or no value. A Fund may be unable to enforce its claims or","page_number":397,"box":{"x":117,"y":132,"width":742,"height":13}},{"id":"89d63b39-2dac-47b4-b686-c60fa292d674","block_type":"box","text":"rights in any collateral or may have its claims or security interest in any collateral challenged, disallowed","page_number":397,"box":{"x":117,"y":148,"width":767,"height":12}},{"id":"0d05e528-1a36-494a-b9c8-1fe1ebd351eb","block_type":"box","text":"or subordinated to the claims or security interests of other creditors. In addition, amendments to the U.S.","page_number":397,"box":{"x":116,"y":163,"width":772,"height":12}},{"id":"a5f40e03-dc7d-40ea-88a0-c8d40863cc22","block_type":"box","text":"Bankruptcy Code or other relevant laws could alter the expected outcome or introduce greater","page_number":397,"box":{"x":117,"y":178,"width":695,"height":12}},{"id":"f977f942-92ed-4b6f-a4a3-66988aa1cf37","block_type":"box","text":"uncertainty regarding the outcome of the Fund’s securities holdings in the issuer. In a bankruptcy","page_number":397,"box":{"x":117,"y":193,"width":716,"height":13}},{"id":"ec14df06-5bfc-4241-aed8-a73713f41fc3","block_type":"box","text":"proceeding, a reorganization or restructuring, the securities of the issuer held by a Fund could be","page_number":397,"box":{"x":117,"y":209,"width":716,"height":12}},{"id":"e0a0f2b8-dcd8-46be-bcf6-d0cfbefc17f6","block_type":"box","text":"re-characterized or a Fund may receive different securities or other assets, including equity securities.","page_number":397,"box":{"x":117,"y":224,"width":752,"height":12}},{"id":"80c11558-2df4-413a-85b6-2d1a4644713e","block_type":"box","text":"These types of equity securities include, but are not limited to: common stock; preferred stock (including","page_number":397,"box":{"x":116,"y":239,"width":768,"height":12}},{"id":"9e40fd77-7847-4559-9c34-211d5f150c31","block_type":"box","text":"convertible preferred stock); bonds, notes and debentures convertible into common or preferred stock;","page_number":397,"box":{"x":116,"y":254,"width":756,"height":13}},{"id":"401d6fd7-d9e8-433f-8daa-be977e44a0ba","block_type":"box","text":"stock purchase warrants and rights; equity interests in trusts; and depositary receipts. Equity securities","page_number":397,"box":{"x":116,"y":270,"width":759,"height":12}},{"id":"2b7ad02d-ff39-43bc-8956-3d9421ea9661","block_type":"box","text":"are subject to changes in value, and their value may be more volatile than those of other asset classes.","page_number":397,"box":{"x":116,"y":285,"width":764,"height":12}},{"id":"a933a6fd-d656-4ee8-8098-dd2ad2a6677e","block_type":"box","text":"Holders of equity securities are subject to more risk than holders of debt securities because the status of","page_number":397,"box":{"x":117,"y":300,"width":771,"height":12}},{"id":"b06b46c8-4a95-497b-a923-d81833118e5d","block_type":"box","text":"equity holders is subordinate to debtholders in an issuer’s capital structure. The value of equity","page_number":397,"box":{"x":116,"y":315,"width":701,"height":13}},{"id":"d3bc7cba-cceb-44a2-b521-bc51a1a190e9","block_type":"box","text":"securities received by a Fund could decline if the financial condition of the issuer deteriorates or if","page_number":397,"box":{"x":116,"y":331,"width":721,"height":12}},{"id":"ff79f288-4341-420f-826f-1c376f54cd62","block_type":"box","text":"overall market and economic conditions, or conditions within the issuer’s region or industry, deteriorate.","page_number":397,"box":{"x":116,"y":346,"width":764,"height":12}},{"id":"8beb007b-4632-4757-adba-219e0ed8c99b","block_type":"box","text":"To the extent that a Fund receives other assets in connection with a bankruptcy proceeding,","page_number":397,"box":{"x":116,"y":378,"width":681,"height":12}},{"id":"24c3bd1e-e362-4e39-aab0-748ad9e9c0c0","block_type":"box","text":"reorganization or financial restructuring, the Fund may also be subject to additional risks associated with","page_number":397,"box":{"x":117,"y":393,"width":770,"height":12}},{"id":"c4678451-7e1c-46a9-97c7-53b7865ec79c","block_type":"box","text":"the assets received. One example of assets that a Fund could receive is an interest in one or more","page_number":397,"box":{"x":116,"y":408,"width":730,"height":12}},{"id":"d58cf402-3867-4929-9bac-2f0e71b263e1","block_type":"box","text":"loans made to the issuer as part of a workout agreed to by a consortium of lienholders and creditors of","page_number":397,"box":{"x":117,"y":423,"width":756,"height":12}},{"id":"12dc37b1-d8cd-4fab-afeb-64f0791a2014","block_type":"box","text":"the issuer. A Fund may receive such interests in loans to the extent permitted by the Investment","page_number":397,"box":{"x":116,"y":438,"width":710,"height":12}},{"id":"c9ab9027-8ddd-4b96-868e-f80de1562768","block_type":"box","text":"Company Act.","page_number":397,"box":{"x":117,"y":453,"width":108,"height":12}},{"id":"0ae58115-ca4e-4ea5-9b6b-d299077edd86","block_type":"box","text":"Securities or other assets received in a reorganization or restructuring typically entail a higher degree","page_number":397,"box":{"x":116,"y":484,"width":756,"height":12}},{"id":"c1a94004-b57a-4b68-ac1e-9caa3e21e4c7","block_type":"box","text":"of risk than investments in securities of issuers that have not undergone a reorganization or","page_number":397,"box":{"x":116,"y":499,"width":684,"height":12}},{"id":"57955cbb-de6e-4b7f-ab01-29d4d17485e0","block_type":"box","text":"restructuring and may be subject to heavy selling or downward pricing pressure after completion of the","page_number":397,"box":{"x":117,"y":514,"width":765,"height":12}},{"id":"754fe488-e246-46db-8c90-925725432f15","block_type":"box","text":"reorganization or restructuring. The post-reorganization/restructuring assets and securities may also be","page_number":397,"box":{"x":117,"y":529,"width":771,"height":12}},{"id":"c74813ee-e0ee-41ab-82d7-57b838439add","block_type":"box","text":"illiquid and difficult to sell or value. If a Fund participates in negotiations with respect to a plan of","page_number":397,"box":{"x":117,"y":544,"width":715,"height":12}},{"id":"13fcebb5-9f6a-4955-afbf-6b4f85bc2ea5","block_type":"box","text":"reorganization or restructuring with respect to securities of the issuer held by a Fund, the Fund also","page_number":397,"box":{"x":117,"y":559,"width":741,"height":12}},{"id":"7617c982-2cc7-423f-aaba-68d9ce826b60","block_type":"box","text":"may be restricted from disposing such securities for a period of time. If a Fund becomes involved in","page_number":397,"box":{"x":117,"y":574,"width":741,"height":12}},{"id":"113523aa-74a2-41ec-8fc3-156182a5335d","block_type":"box","text":"such proceedings, the Fund may have more active participation in the affairs of the issuer than that","page_number":397,"box":{"x":116,"y":589,"width":740,"height":12}},{"id":"76bec00d-83c6-4852-b22c-fd7790f52201","block_type":"box","text":"assumed generally by an investor.","page_number":397,"box":{"x":116,"y":604,"width":260,"height":12}},{"id":"7be3bf9c-13a5-4261-a34b-d71a8ca0b8c5","block_type":"box","text":"Lease Obligations.","page_number":397,"box":{"x":116,"y":636,"width":145,"height":12}},{"id":"b5e265e4-0e46-4971-8595-70a0fd30229f","block_type":"box","text":"A Fund may hold participation certificates in a lease, an installment purchase","page_number":397,"box":{"x":262,"y":636,"width":568,"height":12}},{"id":"16ba4624-9838-41f7-b67f-b6e568ceb4d9","block_type":"box","text":"contract, or a conditional sales contract (“lease","page_number":397,"box":{"x":116,"y":651,"width":344,"height":12}},{"id":"f1972e7e-a160-4b27-adb1-3509a4e90f98","block_type":"box","text":"obligations”). The Manager will monitor the credit standing","page_number":397,"box":{"x":461,"y":651,"width":426,"height":12}},{"id":"60ee1586-478d-4759-8ba9-b8c759539a05","block_type":"box","text":"of each borrower and each entity providing credit support","page_number":397,"box":{"x":116,"y":666,"width":415,"height":12}},{"id":"df1a06a8-d3c3-4b57-8628-38172e6021c7","block_type":"box","text":"and/or a put option relating to lease obligations.","page_number":397,"box":{"x":536,"y":666,"width":343,"height":12}},{"id":"a8cc73a3-38bd-4bb4-8621-c491a04e0331","block_type":"box","text":"Life Settlement Investments.","page_number":397,"box":{"x":116,"y":698,"width":222,"height":9}},{"id":"8153733a-61d0-44ee-b1e8-365b92ee2ee8","block_type":"box","text":"A Fund may invest in life settlements, which are sales to third parties,","page_number":397,"box":{"x":344,"y":698,"width":502,"height":12}},{"id":"12585deb-ea71-4cba-a0d4-f325db84a583","block_type":"box","text":"such as the Fund, of existing life insurance contract","page_number":397,"box":{"x":116,"y":713,"width":374,"height":12}},{"id":"36837e1e-b22d-455e-82f4-bc1ee11008e1","block_type":"box","text":"s for more than their cash surrender value but less","page_number":397,"box":{"x":490,"y":713,"width":366,"height":9}},{"id":"5d291d6e-e631-4c09-9d09-ce1bac659fb8","block_type":"box","text":"than the net benefits to be paid under the policies.","page_number":397,"box":{"x":116,"y":728,"width":362,"height":12}},{"id":"10637993-775e-486a-bd34-42742c02edcc","block_type":"box","text":"When a Fund acquires such a contract, it pays the","page_number":397,"box":{"x":484,"y":728,"width":366,"height":12}},{"id":"1702aa9d-fdcc-4e6b-acf0-b4144faff0c5","block_type":"box","text":"policy premiums in return for the expected receipt","page_number":397,"box":{"x":117,"y":743,"width":359,"height":12}},{"id":"96c5e75d-204e-4a05-9a12-480cd7361871","block_type":"box","text":"of the net benefit as the","page_number":397,"box":{"x":481,"y":743,"width":171,"height":9}},{"id":"53610194-198d-4f9d-a047-7668cbf200a0","block_type":"box","text":"beneficiary under the policy.","page_number":397,"box":{"x":658,"y":743,"width":202,"height":12}},{"id":"de38b77a-be67-48f9-abc4-03b96f957826","block_type":"box","text":"Investments in these contracts involve certain risks,","page_number":397,"box":{"x":117,"y":758,"width":372,"height":11}},{"id":"3715ef2c-bcc9-422c-8cd9-8f8beafaf4de","block_type":"box","text":"including liquidity risk, credit risk of the insurance","page_number":397,"box":{"x":496,"y":758,"width":354,"height":12}},{"id":"e75a4f98-35d6-4a93-b8fd-b2b94e745f0a","block_type":"box","text":"company, and inaccurate estimations of life expectan","page_number":397,"box":{"x":116,"y":773,"width":386,"height":12}},{"id":"63a4f909-948b-4f25-a097-d95d827931c5","block_type":"box","text":"cy of the insured individuals (viators). These policies","page_number":397,"box":{"x":503,"y":773,"width":379,"height":12}},{"id":"102e86c3-0bb1-47ba-8959-c076754a3bd2","block_type":"box","text":"may be considered illiquid because they are bought","page_number":397,"box":{"x":117,"y":788,"width":374,"height":12}},{"id":"ba9c6f4f-c917-4845-ad20-81b371eda5b9","block_type":"box","text":"and sold in a secondary market through life","page_number":397,"box":{"x":496,"y":788,"width":314,"height":12}},{"id":"479776dd-ef59-4928-9414-a4c5ec4b67fb","block_type":"box","text":"settlement agents. Also, in the event of a bankruptcy","page_number":397,"box":{"x":116,"y":802,"width":382,"height":13}},{"id":"f688ab3b-edf0-4631-9151-a37f2c6b126d","block_type":"box","text":"of the insurance carrier for a policy, the Fund may","page_number":397,"box":{"x":503,"y":802,"width":362,"height":13}},{"id":"8002ff72-bf3e-4535-a433-d0f1ad9171c5","block_type":"box","text":"receive reduced or no benefits under the contract. A Fund seeks to minimize credit risk by investing in","page_number":397,"box":{"x":117,"y":817,"width":738,"height":13}},{"id":"d28b6622-75eb-4854-89fc-91b785e35ac0","block_type":"box","text":"policies issued by a diverse range of highly-rated","page_number":397,"box":{"x":117,"y":832,"width":359,"height":13}},{"id":"a4e24ddc-4a07-4d6c-84f2-96a094c4824a","block_type":"box","text":"insurance carriers. Furthermore, a Fund may encounter","page_number":397,"box":{"x":477,"y":833,"width":408,"height":12}},{"id":"5249a88e-3451-43c5-a814-be8bf71a21c5","block_type":"box","text":"losses on its investments if there is an inaccurate","page_number":397,"box":{"x":117,"y":847,"width":361,"height":10}},{"id":"3cbccd47-7885-4680-9f04-9012826bcf0d","block_type":"box","text":"estimation of the life expectancies of viators. A Fund","page_number":397,"box":{"x":478,"y":847,"width":384,"height":12}},{"id":"8dae3d14-2788-4a4f-8f64-7c080c622ec0","block_type":"box","text":"intends to reduce this life expectancy risk by invest","page_number":397,"box":{"x":117,"y":862,"width":368,"height":13}},{"id":"5bb5c1c5-6f8b-49e6-8d2e-08bb3915bce3","block_type":"box","text":"ing only in contracts where the life expectancy was","page_number":397,"box":{"x":486,"y":862,"width":373,"height":13}},{"id":"adc5b7e2-5a73-424e-80ff-db547e7dfbcd","block_type":"box","text":"reviewed by an experienced actuary, as well as by di","page_number":397,"box":{"x":117,"y":878,"width":382,"height":12}},{"id":"9e58abca-5777-4ca5-ad2f-4add0bef290c","block_type":"box","text":"versifying its investments across viators of varying","page_number":397,"box":{"x":500,"y":877,"width":369,"height":13}},{"id":"bb4b3bd6-464e-405a-bd90-9e6ff2a43775","block_type":"box","text":"II-65","page_number":397,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"b92ad983-d6d0-46e1-a28f-f8ff60936a26","block_type":"box","text":"NM1026U-6004382-397/605","page_number":397,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f925c368-a5a8-4345-9dbe-54b0e39cc908","block_type":"box","text":"ages and medical profiles. In addition, it is unclear w","page_number":398,"box":{"x":116,"y":86,"width":368,"height":13}},{"id":"abb2772b-244e-48d4-aaa5-c45369b9a33f","block_type":"box","text":"whether the income from life settlements is qualifying","page_number":398,"box":{"x":484,"y":86,"width":390,"height":13}},{"id":"70129a33-f604-4f8e-adea-f82b14cb8d56","block_type":"box","text":"income for purposes of the IRS 90% gross income","page_number":398,"box":{"x":117,"y":101,"width":371,"height":13}},{"id":"1e0c7987-7e05-486a-83db-cd220fda351f","block_type":"box","text":"test a Fund must satisfy each year to qualify as a","page_number":398,"box":{"x":488,"y":101,"width":361,"height":13}},{"id":"6e6a8991-ec8e-494a-aba0-23f4976585d5","block_type":"box","text":"regulated investment company. A Fund intends to m","page_number":398,"box":{"x":117,"y":117,"width":379,"height":12}},{"id":"b190f51e-ea9e-4cdc-92d7-ff7c0b25b1e7","block_type":"box","text":"onitor its investments to ensure that the Fund","page_number":398,"box":{"x":497,"y":117,"width":334,"height":9}},{"id":"d53053b5-caf1-4036-b05e-fe41a68de0a6","block_type":"box","text":"remains qualified as a regulated investment company.","page_number":398,"box":{"x":117,"y":131,"width":397,"height":13}},{"id":"695d649a-c5f0-487f-b590-c3fc26d8b5c6","block_type":"box","text":"Liquidity Risk Management.","page_number":398,"box":{"x":116,"y":161,"width":221,"height":11}},{"id":"1391c87b-a0d8-428d-bc16-375046f8d70e","block_type":"box","text":"Rule 22e-4 under the Investment Company Act (the “Liquidity Rule”)","page_number":398,"box":{"x":338,"y":160,"width":517,"height":12}},{"id":"a3b405de-1c2f-429f-87ac-79376e7f1ee5","block_type":"box","text":"requires open-end funds, such as the Funds, to adopt a liquidity risk management program and","page_number":398,"box":{"x":117,"y":175,"width":712,"height":12}},{"id":"d861e523-4f3a-4977-ae4c-a77195225d9a","block_type":"box","text":"enhance disclosures regarding fund liquidity. As required by the Liquidity Rule, the Funds have","page_number":398,"box":{"x":116,"y":190,"width":709,"height":12}},{"id":"eb4d8d4f-2842-4901-8890-cc232047ace1","block_type":"box","text":"implemented a liquidity risk management program (the “Liquidity Program”), and the Boards of","page_number":398,"box":{"x":117,"y":205,"width":704,"height":12}},{"id":"0535a49d-48d6-4597-b1d5-73b7aae6cc14","block_type":"box","text":"Directors of the Funds, including a majority of the independent Directors, have appointed the Manager","page_number":398,"box":{"x":117,"y":220,"width":762,"height":12}},{"id":"8d6e5660-7c2d-4a47-a46d-87fde146aaa1","block_type":"box","text":"as the liquidity risk program administrator of the Liquidity Program. Under the Liquidity Program, the","page_number":398,"box":{"x":116,"y":235,"width":745,"height":12}},{"id":"dd5db648-2b8d-4382-8423-d16fe090b565","block_type":"box","text":"Manager assesses, manages, and periodically reviews each Fund’s liquidity risk and classifies each","page_number":398,"box":{"x":117,"y":250,"width":746,"height":12}},{"id":"a1b44337-576d-4eb1-bf79-c469232371b5","block_type":"box","text":"investment held by a Fund as a “highly liquid investment,” “moderately liquid investment,” “less liquid","page_number":398,"box":{"x":117,"y":265,"width":750,"height":12}},{"id":"c98b5ee0-0c3a-444a-abc7-b77fa8df7d3d","block_type":"box","text":"investment” or “illiquid investment.” The Liquidity Rule defines “liquidity risk” as the risk that a Fund","page_number":398,"box":{"x":117,"y":280,"width":736,"height":12}},{"id":"9f94d5d7-d474-4976-b340-0436b78f49b0","block_type":"box","text":"could not meet requests to redeem shares issued by the Fund without significant dilution of the","page_number":398,"box":{"x":116,"y":295,"width":709,"height":12}},{"id":"e4ee9062-aa38-40e0-84be-949d0e11752b","block_type":"box","text":"remaining investors’ interests in the Fund. The liquidity of a Fund’s portfolio investments is determined","page_number":398,"box":{"x":117,"y":310,"width":762,"height":12}},{"id":"7fce1fc1-c164-4503-8ca1-a323aa9a21ca","block_type":"box","text":"based on relevant market, trading and investment-specific considerations under the Liquidity Program.","page_number":398,"box":{"x":117,"y":325,"width":764,"height":12}},{"id":"056a4471-0350-43b2-82d9-809ec169f3d0","block_type":"box","text":"To the extent that an investment is deemed to be an illiquid investment or a less liquid investment, a","page_number":398,"box":{"x":116,"y":340,"width":747,"height":12}},{"id":"4398ab8c-e748-477a-97d8-41d05f864965","block_type":"box","text":"Fund can expect to be exposed to greater liquidity risk.","page_number":398,"box":{"x":117,"y":355,"width":411,"height":12}},{"id":"5d20c0ae-009c-4443-9beb-1e7d2db71c32","block_type":"box","text":"Master Limited Partnerships.","page_number":398,"box":{"x":116,"y":385,"width":230,"height":12}},{"id":"c12012a0-d55e-45c2-8f02-cda2ae18cc90","block_type":"box","text":"Certain Funds may invest in publicly traded master limited partnerships","page_number":398,"box":{"x":347,"y":385,"width":538,"height":12}},{"id":"ec34921b-229f-4fa7-bf2e-6338808bfcb4","block_type":"box","text":"(“MLPs”) which are limited partnerships or limited liability companies taxable as partnerships. MLPs","page_number":398,"box":{"x":117,"y":400,"width":741,"height":12}},{"id":"525dfcb5-1411-44ba-9271-006f60ef08bc","block_type":"box","text":"may derive income and gains from the exploration, development, mining or production, processing,","page_number":398,"box":{"x":117,"y":416,"width":739,"height":12}},{"id":"4b6bbc5c-634c-4add-aa98-0e1cef4f1475","block_type":"box","text":"refining, transportation (including pipelines transporting gas, oil, or products thereof), or the marketing","page_number":398,"box":{"x":117,"y":431,"width":758,"height":12}},{"id":"b3234fd0-d698-4f7e-8fcd-a233ac599952","block_type":"box","text":"of any mineral or natural resources. MLPs generally have two classes of owners, the general partner","page_number":398,"box":{"x":116,"y":447,"width":752,"height":12}},{"id":"7cb34b87-76f6-44e0-95a2-4e81fe085aba","block_type":"box","text":"and limited partners. When investing in an MLP, a Fund intends to purchase publicly traded common","page_number":398,"box":{"x":116,"y":462,"width":753,"height":12}},{"id":"8a431399-5c41-43f7-8e38-9cbd4bbff75e","block_type":"box","text":"units issued to limited partners of the MLP. The general partner is typically owned by a major energy","page_number":398,"box":{"x":117,"y":478,"width":749,"height":12}},{"id":"940baf70-c923-4394-9001-0f1e89387912","block_type":"box","text":"company, an investment fund, the direct management of the MLP or is an entity owned by one or more","page_number":398,"box":{"x":116,"y":493,"width":769,"height":12}},{"id":"ec45b56d-b197-4b14-aa2a-6e131f7b05b5","block_type":"box","text":"of such parties. The general partner may be structured as a private or publicly traded corporation or","page_number":398,"box":{"x":116,"y":509,"width":744,"height":12}},{"id":"1f8805a9-febf-48ac-a0ee-53fdf035ddde","block_type":"box","text":"other entity. The general partner typically controls the operations and management of the MLP through","page_number":398,"box":{"x":116,"y":524,"width":768,"height":12}},{"id":"e4f994c9-cb2e-405d-8eae-0ac173cc9938","block_type":"box","text":"an up to 2% equity interest in the MLP plus, in many cases, ownership of common units and","page_number":398,"box":{"x":116,"y":540,"width":689,"height":12}},{"id":"430c6cb0-5b3b-4f44-8b30-fb384641225b","block_type":"box","text":"subordinated units. Limited partners own the remainder of the partnership, through ownership of","page_number":398,"box":{"x":116,"y":555,"width":718,"height":12}},{"id":"4d8f887e-8736-4c2f-9adc-98491f1e40f9","block_type":"box","text":"common units, and have a limited role in the partnership’s operations and management.","page_number":398,"box":{"x":116,"y":571,"width":658,"height":12}},{"id":"e155b594-a3b0-4cee-a16a-943d2d30dbcb","block_type":"box","text":"MLPs are typically structured such that common units and general partner interests have first priority to","page_number":398,"box":{"x":117,"y":600,"width":769,"height":12}},{"id":"0b5087eb-f728-47d5-8d34-b7ebc2492dd1","block_type":"box","text":"receive quarterly cash distributions up to an established minimum amount (“minimum quarterly","page_number":398,"box":{"x":117,"y":616,"width":706,"height":12}},{"id":"4bf63be3-c7bb-4df6-a73f-3ec343699e69","block_type":"box","text":"distributions” or “MQD”). Common and general partner interests also accrue arrearages in distributions","page_number":398,"box":{"x":116,"y":631,"width":767,"height":12}},{"id":"0074d565-df5d-4e5b-9ae0-da79e72b73b0","block_type":"box","text":"to the extent the MQD is not paid. Once common and general partner interests have been paid,","page_number":398,"box":{"x":116,"y":647,"width":714,"height":12}},{"id":"bc014e56-f715-4a67-ac19-76244fdd5919","block_type":"box","text":"subordinated units receive distributions of up to the MQD; however, subordinated units do not accrue","page_number":398,"box":{"x":116,"y":662,"width":750,"height":12}},{"id":"7e885c4b-5c2f-4f70-884a-0a11901d0a4f","block_type":"box","text":"arrearages. Distributable cash in excess of the MQD paid to both common and subordinated units is","page_number":398,"box":{"x":116,"y":678,"width":743,"height":12}},{"id":"2ae21cad-7d86-47f2-ab4e-df5eb3ad03ba","block_type":"box","text":"distributed to both common and subordinated units generally on a pro rata basis. The general partner","page_number":398,"box":{"x":116,"y":693,"width":752,"height":12}},{"id":"b4b8e9fb-64d2-46f9-ac8c-7c5a449355d5","block_type":"box","text":"is also eligible to receive incentive distributions if the general partner operates the business in a","page_number":398,"box":{"x":117,"y":709,"width":707,"height":12}},{"id":"b125fd18-f2b9-47ab-9a7d-2d4f8108a0a4","block_type":"box","text":"manner which results in distributions paid per common unit surpassing specified target levels. As the","page_number":398,"box":{"x":117,"y":724,"width":746,"height":12}},{"id":"e947de40-71f7-47eb-b480-2a965f7a9c5f","block_type":"box","text":"general partner increases cash distributions to the limited partners, the general partner receives an","page_number":398,"box":{"x":116,"y":740,"width":733,"height":12}},{"id":"87467054-9bb0-46b7-8a09-80d1f4e18028","block_type":"box","text":"increasingly higher percentage of the incremental cash distributions. A common arrangement provides","page_number":398,"box":{"x":117,"y":755,"width":759,"height":12}},{"id":"75e2eb9a-fd7e-42bb-a409-6b0448a9c3c6","block_type":"box","text":"that the general partner can reach a tier where it receives 50% of every incremental dollar paid to","page_number":398,"box":{"x":116,"y":771,"width":722,"height":12}},{"id":"7dbf3084-d02b-4cb4-b8ec-73151656092d","block_type":"box","text":"common and subordinated unit holders. These incentive distributions encourage the general partner to","page_number":398,"box":{"x":116,"y":786,"width":762,"height":12}},{"id":"4466de07-f430-4440-b0c3-83dc47a63930","block_type":"box","text":"streamline costs, increase capital expenditures and acquire assets in order to increase the","page_number":398,"box":{"x":116,"y":802,"width":671,"height":12}},{"id":"f230f6b8-329a-431a-98d0-ab14e12d28db","block_type":"box","text":"partnership’s cash flow and raise the quarterly cash distribution in order to reach higher tiers. Such","page_number":398,"box":{"x":117,"y":817,"width":730,"height":12}},{"id":"004fc761-1c46-4124-978d-1546439540de","block_type":"box","text":"results benefit all security holders of the MLP.","page_number":398,"box":{"x":117,"y":833,"width":343,"height":12}},{"id":"995b8d1e-d8c8-47fc-a122-2798a2d32399","block_type":"box","text":"MLP common units represent a limited partnership interest in the MLP. Common units are listed and","page_number":398,"box":{"x":117,"y":862,"width":748,"height":12}},{"id":"934d9067-d029-4978-b5f4-6d7f3c5bae60","block_type":"box","text":"traded on U.S. securities exchanges, with their value fluctuating predominantly based on prevailing","page_number":398,"box":{"x":116,"y":878,"width":739,"height":12}},{"id":"e18c57ec-28e9-43ac-8259-c8ec114f5ee2","block_type":"box","text":"II-66","page_number":398,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"2161e805-3d0f-441b-8300-b317f72e9d7b","block_type":"box","text":"NM1026U-6004382-398/605","page_number":398,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"aee66c8f-04b1-4b89-9840-1e46ed06ae4c","block_type":"box","text":"market conditions and the success of the MLP. Certain Funds intend to purchase common units in","page_number":399,"box":{"x":117,"y":87,"width":733,"height":12}},{"id":"1c8da29c-82cc-4962-8b52-cba35cdfd42b","block_type":"box","text":"market transactions. Unlike owners of common stock of a corporation, owners of common units have","page_number":399,"box":{"x":117,"y":102,"width":752,"height":12}},{"id":"204ab97e-0884-4f9a-b204-65c8342fec76","block_type":"box","text":"limited voting rights and have no ability to annually elect directors. In the event of liquidation, common","page_number":399,"box":{"x":117,"y":118,"width":758,"height":12}},{"id":"78f8db4a-a8e4-473c-be71-18a1b8397bb3","block_type":"box","text":"units have preference over subordinated units, but not over debt or preferred units, to the remaining","page_number":399,"box":{"x":117,"y":134,"width":744,"height":12}},{"id":"c0d7c88a-a6b4-401f-9171-ce852db4283b","block_type":"box","text":"assets of the MLP.","page_number":399,"box":{"x":116,"y":149,"width":144,"height":10}},{"id":"c33e8c91-724d-47e0-95a7-3eb840e67401","block_type":"box","text":"Merger Transaction Risk.","page_number":399,"box":{"x":116,"y":179,"width":200,"height":12}},{"id":"c072d8fc-c631-4029-af58-a65a96f87430","block_type":"box","text":"A Fund may buy stock of the target company in an announced merger","page_number":399,"box":{"x":317,"y":179,"width":531,"height":12}},{"id":"01a1e1b7-bace-42ca-911e-1d718edf2909","block_type":"box","text":"transaction prior to the consummation of such transaction. In that circumstance, a Fund would expect","page_number":399,"box":{"x":116,"y":194,"width":757,"height":12}},{"id":"ba1ec907-273e-48f8-826e-1f8685a3ba02","block_type":"box","text":"to receive an amount (whether in cash, stock of the acquiring company or a combination of both) in","page_number":399,"box":{"x":116,"y":210,"width":740,"height":12}},{"id":"2d7f05a5-2560-4d23-be58-535f464c5139","block_type":"box","text":"excess of the purchase price paid by the Fund for the target company’s stock. However, a Fund is","page_number":399,"box":{"x":116,"y":225,"width":733,"height":13}},{"id":"ae30e75c-c827-4462-98f7-b58ae3b1118e","block_type":"box","text":"subject to the risk that the merger transaction may be canceled, delayed or restructured, in which case","page_number":399,"box":{"x":116,"y":241,"width":766,"height":12}},{"id":"5bdc285b-6e2a-436f-8eeb-2c06d626b78c","block_type":"box","text":"a Fund’s holding of the target company’s stock may not result in any profit for the Fund and may lose","page_number":399,"box":{"x":116,"y":256,"width":754,"height":13}},{"id":"760248fe-4aa1-4c40-8857-337a36da5af8","block_type":"box","text":"significant value.","page_number":399,"box":{"x":116,"y":272,"width":129,"height":12}},{"id":"9b69553e-59b6-4605-9690-9c67442f2c89","block_type":"box","text":"Money Market Obligations of Domestic Banks, Foreign Banks and Foreign Branches of U.S.","page_number":399,"box":{"x":116,"y":302,"width":737,"height":12}},{"id":"f4607f01-1b47-4455-84fd-af16fb27eb58","block_type":"box","text":"Banks.","page_number":399,"box":{"x":116,"y":318,"width":54,"height":9}},{"id":"1ecb4c64-e864-4fa7-89c9-9fe0cbec0ab0","block_type":"box","text":"Certain Funds may purchase bank obligations, such as certificates of deposit, notes, bankers’","page_number":399,"box":{"x":171,"y":317,"width":705,"height":12}},{"id":"db582b18-8b8b-46b6-ab08-114d96b21227","block_type":"box","text":"acceptances and time deposits, including instruments issued or supported by the credit of U.S. or","page_number":399,"box":{"x":116,"y":333,"width":728,"height":12}},{"id":"3bccb2ff-d44b-40aa-a8c4-07f6a9e14951","block_type":"box","text":"foreign banks or savings institutions having total assets at the time of purchase in excess of $1 billion.","page_number":399,"box":{"x":116,"y":348,"width":761,"height":12}},{"id":"1cda574f-4e88-4e9f-917a-8a67496abda0","block_type":"box","text":"These obligations may be general obligations of the parent bank or may be limited to the issuing","page_number":399,"box":{"x":116,"y":364,"width":719,"height":12}},{"id":"fabbdf85-b278-4110-a03b-da69d461a0b1","block_type":"box","text":"branch or subsidiary by the terms of a specific obligation or by government regulation. The assets of a","page_number":399,"box":{"x":117,"y":379,"width":761,"height":12}},{"id":"4da8be36-8506-4f07-a21b-9487c5d4f109","block_type":"box","text":"bank or savings institution will be deemed to include the assets of its domestic and foreign branches","page_number":399,"box":{"x":117,"y":395,"width":747,"height":12}},{"id":"e3894e9a-f5e4-453d-b830-6c2eb3f3c768","block_type":"box","text":"for purposes of a Fund’s investment policies. Investments in short-term bank obligations may include","page_number":399,"box":{"x":116,"y":410,"width":753,"height":12}},{"id":"e5876bfa-5c8e-4ae8-ad3e-1f8800b927fd","block_type":"box","text":"obligations of foreign banks and domestic branches of foreign banks, and also foreign branches of","page_number":399,"box":{"x":116,"y":426,"width":734,"height":12}},{"id":"f8154886-5c53-4d18-a515-64add4c67137","block_type":"box","text":"domestic banks.","page_number":399,"box":{"x":116,"y":442,"width":126,"height":9}},{"id":"bf30a64c-35e4-4f88-97b9-eb978e260c2e","block_type":"box","text":"To the extent consistent with their investment objectives, a Fund may invest in debt obligations of","page_number":399,"box":{"x":116,"y":471,"width":727,"height":12}},{"id":"cec4d813-b645-45dc-b91b-9d612a86a7fb","block_type":"box","text":"domestic or foreign corporations and banks, and may acquire commercial obligations issued by","page_number":399,"box":{"x":116,"y":487,"width":713,"height":12}},{"id":"7312bee2-f1c1-42be-bc80-5388efe98199","block_type":"box","text":"Canadian corporations and Canadian counterparts of U.S. corporations, as well as Europaper, which is","page_number":399,"box":{"x":117,"y":502,"width":769,"height":12}},{"id":"23f004c7-5c72-47c2-8594-337f24502bea","block_type":"box","text":"U.S. dollar-denominated commercial paper of a foreign issuer.","page_number":399,"box":{"x":117,"y":518,"width":466,"height":12}},{"id":"3ad407c5-1825-4947-8383-1a16de545d1d","block_type":"box","text":"Money Market Securities.","page_number":399,"box":{"x":116,"y":548,"width":201,"height":12}},{"id":"68b58ffb-1af3-42b7-8c41-cc6e22548444","block_type":"box","text":"Certain Funds may invest in a broad range of short-term, high quality, U.S.","page_number":399,"box":{"x":318,"y":548,"width":564,"height":12}},{"id":"61b829b5-14fa-4eda-98ad-12d6ad3d4438","block_type":"box","text":"dollar-denominated instruments, such as government, bank, commercial and other obligations that are","page_number":399,"box":{"x":116,"y":563,"width":765,"height":12}},{"id":"fa48880c-db8e-4ebf-93b2-0890aa1c6581","block_type":"box","text":"available in the money markets. In particular, the Funds may invest in:","page_number":399,"box":{"x":116,"y":579,"width":526,"height":12}},{"id":"16615721-c89d-4898-8c9f-46573097d810","block_type":"box","text":"(a) U.S. dollar-denominated obligations issued or supported by the credit of U.S. or foreign banks","page_number":399,"box":{"x":150,"y":601,"width":735,"height":13}},{"id":"af95cd83-f5d8-475b-8654-0b85fbaee4cc","block_type":"box","text":"or savings institutions with total assets in excess of $1 billion (including obligations of foreign","page_number":399,"box":{"x":184,"y":616,"width":690,"height":13}},{"id":"4502df7a-9fd2-444f-a31d-c5aa264550e0","block_type":"box","text":"branches of such banks);","page_number":399,"box":{"x":184,"y":632,"width":192,"height":13}},{"id":"9997baaf-2365-4b5d-857d-9a52bdf0b28e","block_type":"box","text":"(b) high quality commercial paper and other obligations issued or guaranteed by U.S. and foreign","page_number":399,"box":{"x":150,"y":655,"width":734,"height":12}},{"id":"a8634dda-3e53-407c-9a63-6424b05820ef","block_type":"box","text":"corporations and other issuers rated (at the time of purchase) A-2 or higher by S&P, Prime-2","page_number":399,"box":{"x":184,"y":671,"width":686,"height":12}},{"id":"e8ad450d-215c-4ef9-8dc5-c29181187b4b","block_type":"box","text":"or higher by Moody’s or F-2 or higher by Fitch, as well as high quality corporate bonds rated","page_number":399,"box":{"x":184,"y":686,"width":681,"height":12}},{"id":"e5744665-af92-48df-ac38-e2cb565b8c88","block_type":"box","text":"(at the time of purchase) A or higher by those rating agencies;","page_number":399,"box":{"x":184,"y":702,"width":459,"height":12}},{"id":"c645a209-ac1f-4f6c-978d-a726095fb29b","block_type":"box","text":"(c) unrated notes, paper and other instruments that are of comparable quality to the instruments","page_number":399,"box":{"x":150,"y":724,"width":720,"height":12}},{"id":"fb03e901-67ae-4c5e-a407-a9c36d1209ca","block_type":"box","text":"described in (b) above as determined by the Fund’s Manager;","page_number":399,"box":{"x":184,"y":740,"width":457,"height":12}},{"id":"77633b16-3402-4885-9b65-f9a716d574bf","block_type":"box","text":"(d) asset-backed securities (including interests in pools of assets such as mortgages, installment","page_number":399,"box":{"x":150,"y":762,"width":725,"height":13}},{"id":"b1c57798-7f77-45ed-a0f5-7798e1ff24c0","block_type":"box","text":"purchase obligations and credit card receivables);","page_number":399,"box":{"x":184,"y":778,"width":368,"height":12}},{"id":"91598013-8b00-4b1a-aa7d-fd6feddd9d64","block_type":"box","text":"(e) securities issued or guaranteed as to principal and interest by the U.S. Government or by its","page_number":399,"box":{"x":150,"y":801,"width":717,"height":12}},{"id":"4c6706b5-a652-4629-8271-93f7cbf08006","block_type":"box","text":"agencies or authorities and related custodial receipts;","page_number":399,"box":{"x":184,"y":816,"width":395,"height":12}},{"id":"5fe344b2-f059-4f72-9fe8-44711fe0ab73","block_type":"box","text":"(f) dollar-denominated securities issued or guaranteed by foreign governments or their political","page_number":399,"box":{"x":150,"y":839,"width":719,"height":12}},{"id":"522884ad-a919-4871-949e-14856b7329e8","block_type":"box","text":"subdivisions, agencies or authorities;","page_number":399,"box":{"x":184,"y":854,"width":279,"height":12}},{"id":"67cd56a7-adc2-4399-a398-2ba1ac89998c","block_type":"box","text":"(g) funding agreements issued by highly-rated U.S. insurance companies;","page_number":399,"box":{"x":150,"y":877,"width":561,"height":12}},{"id":"1c96ca07-74ef-4c4b-b381-5d9be212b8c6","block_type":"box","text":"II-67","page_number":399,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"07de8f65-f869-4bdf-a57a-54ea6fd10824","block_type":"box","text":"NM1026U-6004382-399/605","page_number":399,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"8ada9243-b241-4239-9782-8cdad1a7068b","block_type":"box","text":"(h) securities issued or guaranteed by state or local governmental bodies;","page_number":400,"box":{"x":150,"y":87,"width":560,"height":12}},{"id":"d2f4b066-b779-4a56-a08e-37681f10c7d6","block_type":"box","text":"(i) repurchase agreements relating to the above instruments;","page_number":400,"box":{"x":150,"y":109,"width":469,"height":12}},{"id":"e615f5fc-d28a-49e3-aa17-9ffe04041e31","block_type":"box","text":"(j) municipal bonds and notes whose principal and interest payments are guaranteed by the U.S.","page_number":400,"box":{"x":150,"y":131,"width":736,"height":12}},{"id":"75a25335-2374-408f-a526-147064117aee","block_type":"box","text":"Government or one of its agencies or authorities or which otherwise depend directly or","page_number":400,"box":{"x":184,"y":147,"width":646,"height":12}},{"id":"13107c26-4c48-419c-ae77-5fb8d094f3e0","block_type":"box","text":"indirectly on the credit of the United States;","page_number":400,"box":{"x":184,"y":162,"width":325,"height":12}},{"id":"0d8a0177-ba62-4588-8777-0978ae9b7b05","block_type":"box","text":"(k) fixed and variable rate notes and similar debt instruments rated MIG-2, VMIG-2 or Prime-2 or","page_number":400,"box":{"x":150,"y":184,"width":730,"height":12}},{"id":"e7640d23-e1fc-427a-8a19-5aac005e99fc","block_type":"box","text":"higher by Moody’s, SP-2 or A-2 or higher by S&P, or F-2 or higher by Fitch;","page_number":400,"box":{"x":184,"y":200,"width":563,"height":12}},{"id":"8c73dca4-f6e7-4176-b9c8-962da54dba5d","block_type":"box","text":"(l) tax-exempt commercial paper and similar debt instruments rated Prime-2 or higher by","page_number":400,"box":{"x":150,"y":222,"width":675,"height":12}},{"id":"13f1873f-d512-4d72-8ebe-97f84a362e02","block_type":"box","text":"Moody’s, A-2 or higher by S&P, or F-2 or higher by Fitch;","page_number":400,"box":{"x":184,"y":237,"width":428,"height":12}},{"id":"3a4b3eec-485f-4ecd-92da-53ec574cb90b","block_type":"box","text":"(m) municipal bonds rated A or higher by Moody’s, S&P or Fitch;","page_number":400,"box":{"x":150,"y":259,"width":488,"height":13}},{"id":"68f72b28-56c2-4a94-b49f-990d503a801c","block_type":"box","text":"(n) unrated notes, paper or other instruments that are of comparable quality to the instruments","page_number":400,"box":{"x":150,"y":282,"width":713,"height":12}},{"id":"b9df024b-0ced-4067-9d01-4e177625dc88","block_type":"box","text":"described above, as determined by the Fund’s Manager under guidelines established by the","page_number":400,"box":{"x":184,"y":297,"width":688,"height":12}},{"id":"07adaa8e-1fc0-42b8-a926-98f0a2194f7c","block_type":"box","text":"Board; and","page_number":400,"box":{"x":184,"y":313,"width":86,"height":11}},{"id":"c696762a-3750-45a3-b593-2fd8babd87b3","block_type":"box","text":"(o) municipal bonds and notes which are guaranteed as to principal and interest by the U.S.","page_number":400,"box":{"x":150,"y":335,"width":693,"height":12}},{"id":"936f1f47-c699-4795-ac51-0a77d192535a","block_type":"box","text":"Government or an agency or instrumentality thereof or which otherwise depend directly or","page_number":400,"box":{"x":184,"y":350,"width":671,"height":12}},{"id":"6a50e3b4-6213-48e7-9b58-437c71c380d0","block_type":"box","text":"indirectly on the credit of the United States.","page_number":400,"box":{"x":184,"y":366,"width":325,"height":12}},{"id":"94bd209b-4a56-47ac-b90c-f240011db1a7","block_type":"box","text":"Mortgage-Related Securities.","page_number":400,"box":{"x":116,"y":394,"width":236,"height":13}},{"id":"0e761d17-6685-4f30-89e3-69ce47085c5f","block_type":"box","text":"Mortgage-Backed Securities.","page_number":400,"box":{"x":116,"y":417,"width":210,"height":12}},{"id":"af0f744a-2c96-43d0-b1ef-3011d3131101","block_type":"box","text":"Mortgage-backed securities represent interests in pools of mortgages in","page_number":400,"box":{"x":327,"y":417,"width":532,"height":12}},{"id":"e81ed8f9-1656-4278-a296-3b2e493dde6f","block_type":"box","text":"which payments of both principal and interest on the","page_number":400,"box":{"x":116,"y":432,"width":384,"height":12}},{"id":"8f3941df-0ee6-465e-8ada-285e738e12d7","block_type":"box","text":"securities are generally made monthly, in effect","page_number":400,"box":{"x":500,"y":432,"width":348,"height":12}},{"id":"730653ea-ee7a-4c7b-99b6-6d553bf6e598","block_type":"box","text":"“passing through” monthly payments made by borro","page_number":400,"box":{"x":116,"y":448,"width":377,"height":12}},{"id":"c59c24be-61ae-4a06-93b0-38b4ba66a33c","block_type":"box","text":"wers on the residential or commercial mortgage","page_number":400,"box":{"x":493,"y":448,"width":352,"height":12}},{"id":"e7206d7e-4d19-4f1f-a69a-eb51fa673ffe","block_type":"box","text":"loans that underlie the securities (net of any fees","page_number":400,"box":{"x":117,"y":463,"width":357,"height":12}},{"id":"8ea7b868-88f5-4302-a8ca-a0a1aa2997ce","block_type":"box","text":"paid to the issuer or guarantor of the securities).","page_number":400,"box":{"x":475,"y":463,"width":353,"height":12}},{"id":"9d6afd7e-937c-48e7-8dd6-5b1fd81f3b45","block_type":"box","text":"Mortgage-backed securities differ from other forms of","page_number":400,"box":{"x":117,"y":479,"width":391,"height":12}},{"id":"184272da-c367-441a-9a76-0200c477ec9f","block_type":"box","text":"debt securities, which normally provide for periodic","page_number":400,"box":{"x":508,"y":479,"width":372,"height":12}},{"id":"c76337f2-6c56-4a3f-86ce-d677050de489","block_type":"box","text":"payment of interest in fixed amounts with principal","page_number":400,"box":{"x":117,"y":494,"width":362,"height":12}},{"id":"97e13d5b-fb27-448f-83ad-d2d75a5fd347","block_type":"box","text":"payments at maturity or specified call dates.","page_number":400,"box":{"x":479,"y":494,"width":330,"height":12}},{"id":"b28e1d98-adf8-4615-9dbd-c3beac473ee1","block_type":"box","text":"Mortgage-backed securities are subject to the general risks associated with investing in real estate","page_number":400,"box":{"x":117,"y":523,"width":736,"height":12}},{"id":"635b6a18-445d-47c0-9c61-b1dc9bc902eb","block_type":"box","text":"securities; that is, they may lose value if the value of the underlying real estate to which a pool of","page_number":400,"box":{"x":116,"y":538,"width":722,"height":12}},{"id":"05c9c93c-83db-4ae4-bcf6-ec24813abdd9","block_type":"box","text":"mortgages relates declines. In addition, investments in mortgage-backed securities involve certain","page_number":400,"box":{"x":117,"y":554,"width":732,"height":12}},{"id":"e7ceb424-4aec-47c1-8a75-49cefaa3bb52","block_type":"box","text":"specific risks. These risks include the failure of a party to meet its commitments under the related","page_number":400,"box":{"x":116,"y":569,"width":726,"height":12}},{"id":"fa2dd34a-46d2-49f5-9415-568c620e9fca","block_type":"box","text":"operative documents, adverse interest rate changes and the effects of prepayments on mortgage cash","page_number":400,"box":{"x":116,"y":585,"width":767,"height":12}},{"id":"d0642cfe-9777-4dd1-a9a8-9abdf4b9e928","block_type":"box","text":"flows. Mortgage-backed securities are “pass-through” securities, meaning that principal and interest","page_number":400,"box":{"x":116,"y":600,"width":744,"height":12}},{"id":"fc4900cf-d2f1-4e3a-b2c6-e609ce163bce","block_type":"box","text":"payments made by the borrower on the underlying mortgages are passed through to a Fund.","page_number":400,"box":{"x":117,"y":616,"width":693,"height":12}},{"id":"d87c2527-a908-4fad-a63a-8848f00486d8","block_type":"box","text":"Accordingly, the value of mortgage-backed securities in which a Fund invests may be particularly","page_number":400,"box":{"x":116,"y":631,"width":725,"height":12}},{"id":"04d9034e-9ba7-4f5f-bfda-88b63ff1c42f","block_type":"box","text":"sensitive to changes in prevailing interest rates, and, like other fixed income investments, the ability of","page_number":400,"box":{"x":116,"y":647,"width":761,"height":12}},{"id":"664ea96d-0a5a-4093-80aa-58da230543c3","block_type":"box","text":"a Fund to utilize these instruments successfully may depend in part upon the ability of the Manager to","page_number":400,"box":{"x":116,"y":662,"width":754,"height":12}},{"id":"022322bd-5aba-43cf-bd54-5a5f5ba94ae7","block_type":"box","text":"forecast interest rates and other economic factors correctly. The value of mortgage-backed securities,","page_number":400,"box":{"x":116,"y":678,"width":755,"height":12}},{"id":"abff09ec-c83f-40cf-b59f-70908aa1d7f5","block_type":"box","text":"like that of traditional fixed-income securities, typically increases when interest rates fall and decreases","page_number":400,"box":{"x":117,"y":693,"width":762,"height":12}},{"id":"07faf72d-625b-4a86-b671-76001f4b5d08","block_type":"box","text":"when interest rates rise. However, mortgage-backed securities differ from traditional fixed-income","page_number":400,"box":{"x":116,"y":709,"width":724,"height":12}},{"id":"11cb1266-df3f-46ce-afce-4d4b569a61fa","block_type":"box","text":"securities because of their potential for prepayment without penalty. The price paid by a Fund for its","page_number":400,"box":{"x":116,"y":724,"width":739,"height":12}},{"id":"712f9a7f-6076-4e7c-9346-899bbd03f4d7","block_type":"box","text":"mortgage-backed securities, the yield the Fund expects to receive from such securities and the","page_number":400,"box":{"x":117,"y":740,"width":704,"height":12}},{"id":"0c6dc43e-458f-487f-89c7-8b5b77365ed9","block_type":"box","text":"weighted average life of the securities are based on a number of factors, including the anticipated rate","page_number":400,"box":{"x":116,"y":755,"width":757,"height":12}},{"id":"284f59c7-7105-42ee-97bb-fb3c205e5027","block_type":"box","text":"of prepayment of the underlying mortgages. In a period of declining interest rates, borrowers may","page_number":400,"box":{"x":116,"y":771,"width":722,"height":12}},{"id":"7a1c1a0e-0ef8-48a4-953e-03f34af3c44a","block_type":"box","text":"prepay the underlying mortgages more quickly than anticipated, thereby reducing the yield to maturity","page_number":400,"box":{"x":117,"y":787,"width":753,"height":11}},{"id":"dac4187b-0766-4805-a9cf-e26ab2b82d33","block_type":"box","text":"and the average life of the mortgage-backed securities. Moreover, when a Fund reinvests the proceeds","page_number":400,"box":{"x":116,"y":802,"width":766,"height":12}},{"id":"2ceb3c63-72f0-48d2-aada-e963c1ff8efa","block_type":"box","text":"of a prepayment in these circumstances, it will likely receive a rate of interest that is lower than the rate","page_number":400,"box":{"x":116,"y":817,"width":764,"height":12}},{"id":"fb90f01b-b3c6-46a3-969e-2c23d61e687a","block_type":"box","text":"on the security that was prepaid.","page_number":400,"box":{"x":116,"y":833,"width":247,"height":12}},{"id":"5628e169-3576-4682-add3-7b2b0ea19ae1","block_type":"box","text":"To the extent that a Fund purchases mortgage-backed securities at a premium, mortgage foreclosures","page_number":400,"box":{"x":116,"y":862,"width":766,"height":12}},{"id":"566af674-420c-40cc-a889-c90a8e4158c3","block_type":"box","text":"and principal prepayments may result in a loss to the extent of the premium paid. If a Fund buys such","page_number":400,"box":{"x":116,"y":877,"width":758,"height":12}},{"id":"4af2a4a5-1a15-440a-970e-991137c24b5a","block_type":"box","text":"II-68","page_number":400,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"4034f47e-735c-478a-927e-6ca7ec58efbf","block_type":"box","text":"NM1026U-6004382-400/605","page_number":400,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"d4e0a585-55a8-4828-928a-7d815c85f57c","block_type":"box","text":"securities at a discount, both scheduled payments of principal and unscheduled prepayments will","page_number":401,"box":{"x":116,"y":87,"width":726,"height":12}},{"id":"dd5de818-323f-42e1-9825-39548458ee85","block_type":"box","text":"increase current and total returns and will accelerate the recognition of income, which, when distributed","page_number":401,"box":{"x":117,"y":102,"width":771,"height":13}},{"id":"c04dc44a-e920-4f59-86a0-2b93c820da32","block_type":"box","text":"to shareholders, will be taxable as ordinary income. In a period of rising interest rates, prepayments of","page_number":401,"box":{"x":116,"y":118,"width":762,"height":12}},{"id":"a701c92e-91da-46df-a601-00c7817fd974","block_type":"box","text":"the underlying mortgages may occur at a slower than expected rate, creating maturity extension risk.","page_number":401,"box":{"x":116,"y":134,"width":753,"height":12}},{"id":"5dc274c2-1c88-4040-9b46-31f22bbf16dc","block_type":"box","text":"This particular risk may effectively change a security that was considered short- or intermediate-term at","page_number":401,"box":{"x":116,"y":149,"width":771,"height":12}},{"id":"21f4cf68-fbe3-474a-9139-952860879547","block_type":"box","text":"the time of purchase into a long-term security. Since the value of long-term securities generally","page_number":401,"box":{"x":116,"y":165,"width":709,"height":12}},{"id":"c73f67f9-70f1-4373-abbf-c1822897a80d","block_type":"box","text":"fluctuates more widely in response to changes in interest rates than that of shorter-term securities,","page_number":401,"box":{"x":116,"y":180,"width":736,"height":12}},{"id":"3cce887e-3e56-4964-923b-ec5a75313bff","block_type":"box","text":"maturity extension risk could increase the inherent volatility of the Fund. Under certain interest rate and","page_number":401,"box":{"x":117,"y":196,"width":769,"height":12}},{"id":"b8f66c80-51b9-43ac-a2cf-7247316ba954","block_type":"box","text":"prepayment scenarios, a Fund may fail to recoup fully its investment in mortgage-backed securities","page_number":401,"box":{"x":117,"y":211,"width":740,"height":12}},{"id":"42c475af-1535-4479-b2fe-1d94f8c92c61","block_type":"box","text":"notwithstanding any direct or indirect governmental or agency guarantee.","page_number":401,"box":{"x":117,"y":227,"width":547,"height":12}},{"id":"bcd5cc59-1add-4fd8-9586-f44c7d2e8d14","block_type":"box","text":"There are currently three types of mortgage pass-through securities: (1) those issued by the U.S.","page_number":401,"box":{"x":116,"y":254,"width":725,"height":12}},{"id":"1d149297-8fa3-4ce7-ac16-e0c9cbcf7724","block_type":"box","text":"Government or one of its agencies or instrumentalities, such as the Government National Mortgage","page_number":401,"box":{"x":117,"y":269,"width":742,"height":12}},{"id":"d5616ef4-119b-45e1-aa20-40d72bfb53c1","block_type":"box","text":"Association (“Ginnie Mae”), the Federal National Mortgage Association (“Fannie Mae”) and the Federal","page_number":401,"box":{"x":116,"y":285,"width":770,"height":12}},{"id":"265f83bc-ad09-47a2-94c1-d749cff9769d","block_type":"box","text":"Home Loan Mortgage Corporation (“Freddie Mac”); (2) those issued by private issuers that represent","page_number":401,"box":{"x":117,"y":300,"width":753,"height":12}},{"id":"fbac4a98-b0c4-4f1b-b1c2-81a1ef0ec908","block_type":"box","text":"an interest in or are collateralized by pass-through securities issued or guaranteed by the U.S.","page_number":401,"box":{"x":116,"y":316,"width":704,"height":12}},{"id":"1510ef13-aa68-4453-96a5-6ed7aa18ee4b","block_type":"box","text":"Government or one of its agencies or instrumentalities; and (3) those issued by private issuers that","page_number":401,"box":{"x":117,"y":331,"width":737,"height":12}},{"id":"3525fd67-91bd-490a-8f94-b9106ba7d81a","block_type":"box","text":"represent an interest in or are collateralized by whole mortgage loans or pass-through securities","page_number":401,"box":{"x":117,"y":347,"width":717,"height":12}},{"id":"15c065b7-32ec-4edd-8254-d2f18ff67958","block_type":"box","text":"without a government guarantee but that usually have some form of private credit enhancement.","page_number":401,"box":{"x":116,"y":362,"width":720,"height":12}},{"id":"d6becd81-7c02-4405-b6b2-0d802c104b3d","block_type":"box","text":"Ginnie Mae is a wholly owned U.S. Government corporation within the Department of Housing and","page_number":401,"box":{"x":117,"y":389,"width":736,"height":12}},{"id":"13fd6e68-ea45-41c9-bd99-3d029b922bed","block_type":"box","text":"Urban Development. Ginnie Mae is authorized to guarantee, with the full faith and credit of the U.S.","page_number":401,"box":{"x":117,"y":405,"width":741,"height":12}},{"id":"ee2e6b60-234e-4318-9bd5-786f57160f26","block_type":"box","text":"Government, the timely payment of principal and interest on securities issued by the institutions","page_number":401,"box":{"x":117,"y":420,"width":713,"height":12}},{"id":"91968960-ffce-4c9c-9e89-a8a2d943d9e2","block_type":"box","text":"approved by Ginnie Mae (such as savings and loan institutions, commercial banks and mortgage","page_number":401,"box":{"x":116,"y":436,"width":725,"height":12}},{"id":"4f971c94-6047-4183-9573-f9764b2ebd6f","block_type":"box","text":"banks), and backed by pools of Federal Housing Administration (“FHA”)-insured or Veterans’","page_number":401,"box":{"x":117,"y":451,"width":693,"height":12}},{"id":"aea228d2-543d-4921-a7bf-6b49c13d228a","block_type":"box","text":"Administration (“VA”)-guaranteed mortgages. Pass-through certificates guaranteed by Ginnie Mae","page_number":401,"box":{"x":116,"y":467,"width":733,"height":12}},{"id":"7e825443-8cec-43a0-bca3-9d076890697c","block_type":"box","text":"(such certificates are also known as “Ginnie Maes”) are guaranteed as to the timely payment of","page_number":401,"box":{"x":117,"y":482,"width":711,"height":12}},{"id":"bf001501-dc9d-413d-9f3e-d6435848e826","block_type":"box","text":"principal and interest by Ginnie Mae, whose guarantee is backed by the full faith and credit of the","page_number":401,"box":{"x":117,"y":498,"width":725,"height":12}},{"id":"960e6d31-9f69-4fad-8bc8-d3d449f36c4f","block_type":"box","text":"United States. Ginnie Mae certificates also are supported by the authority of Ginnie Mae to borrow","page_number":401,"box":{"x":117,"y":513,"width":733,"height":12}},{"id":"8448a0e9-85f2-4b65-9d76-745ab5539aaf","block_type":"box","text":"funds from the U.S. Treasury Department to make payments under its guarantee. Mortgage-related","page_number":401,"box":{"x":116,"y":529,"width":743,"height":12}},{"id":"74fa29f2-d741-4a68-ad17-555c38a7a991","block_type":"box","text":"securities issued by Fannie Mae include Fannie Mae guaranteed Mortgage Pass-Through Certificates","page_number":401,"box":{"x":116,"y":544,"width":761,"height":12}},{"id":"4737b0b1-98a9-49e2-a4d9-d300399421ed","block_type":"box","text":"(also known as “Fannie Maes”), which are guaranteed as to timely payment of principal and interest by","page_number":401,"box":{"x":117,"y":560,"width":766,"height":12}},{"id":"5f0ec294-a9da-4a0b-b784-a6b7ec54e6f9","block_type":"box","text":"Fannie Mae. They are not backed by or entitled to the full faith and credit of the United States, but are","page_number":401,"box":{"x":117,"y":575,"width":759,"height":12}},{"id":"b4f84be0-91e2-4ce4-9ab0-ee01c5a5c905","block_type":"box","text":"supported by the right of Fannie Mae to borrow from the U.S. Treasury Department. Fannie Mae was","page_number":401,"box":{"x":116,"y":591,"width":755,"height":12}},{"id":"c3d348f6-e887-4936-937a-2a37fcd2b83f","block_type":"box","text":"established as a federal agency in 1938 and in 1968 was chartered by Congress as a private","page_number":401,"box":{"x":116,"y":606,"width":695,"height":12}},{"id":"52e8fe25-b08e-4459-b463-0509e7b49eb1","block_type":"box","text":"shareholder-owned company. Mortgage-related securities issued by Freddie Mac include Freddie Mac","page_number":401,"box":{"x":116,"y":622,"width":765,"height":12}},{"id":"02a2d40b-d418-48fb-8381-e130dfcddfcf","block_type":"box","text":"Mortgage Participation Certificates (also known as “Freddie Macs” or “PCs”). Freddie Mac is a","page_number":401,"box":{"x":117,"y":637,"width":702,"height":12}},{"id":"a73455ac-1c4b-4b54-a8e7-507c6f39f11c","block_type":"box","text":"stockholder-owned corporation chartered by Congress in 1970. Freddie Macs are not guaranteed by","page_number":401,"box":{"x":116,"y":653,"width":750,"height":12}},{"id":"a522cdcb-0040-43cd-8132-d50bc08fee28","block_type":"box","text":"the United States or by any Federal Home Loan Banks and do not constitute a debt or obligation of the","page_number":401,"box":{"x":116,"y":668,"width":763,"height":12}},{"id":"ba70db07-61c8-44ce-840f-0ffa3d92f019","block_type":"box","text":"United States or of any Federal Home Loan Bank. Freddie Macs entitle the holder to timely payment of","page_number":401,"box":{"x":117,"y":684,"width":763,"height":12}},{"id":"fb7a35f7-c1a5-4665-8222-70077dc27d33","block_type":"box","text":"interest, which is guaranteed by Freddie Mac. Freddie Mac guarantees either ultimate collection or","page_number":401,"box":{"x":117,"y":700,"width":731,"height":12}},{"id":"0373f1f0-653d-448e-b8e2-a0310ae239df","block_type":"box","text":"timely payment of all principal payments on the underlying mortgage loans. While Freddie Mac","page_number":401,"box":{"x":116,"y":715,"width":702,"height":12}},{"id":"203cb2af-94da-4e78-8b52-bd8ebf75f78a","block_type":"box","text":"generally does not guarantee timely payment of principal, Freddie Mac may remit the amount due on","page_number":401,"box":{"x":116,"y":730,"width":747,"height":13}},{"id":"71ef2d50-4124-40f1-8347-d55861de425d","block_type":"box","text":"account of its guarantee of ultimate payment of principal at any time after default on an underlying","page_number":401,"box":{"x":116,"y":746,"width":726,"height":12}},{"id":"44cd5856-45c2-4be6-a024-ffd6a10c5030","block_type":"box","text":"mortgage, but in no event later than one year after it becomes payable.","page_number":401,"box":{"x":117,"y":761,"width":526,"height":13}},{"id":"591d0ef7-020b-46b1-8082-859974a393b9","block_type":"box","text":"Private mortgage pass-through securities are structured similarly to Ginnie Mae, Fannie Mae, and","page_number":401,"box":{"x":117,"y":789,"width":724,"height":12}},{"id":"d3e0fff9-68f8-47aa-83d3-336e2356bb68","block_type":"box","text":"Freddie Mac mortgage pass-through securities and are issued by originators of and investors in","page_number":401,"box":{"x":117,"y":804,"width":708,"height":12}},{"id":"3c629893-6d35-4dd3-8294-0c7d306988ca","block_type":"box","text":"mortgage loans, including depository institutions, mortgage banks, investment banks and special","page_number":401,"box":{"x":117,"y":820,"width":716,"height":12}},{"id":"6d333a38-9c98-494b-a173-49df33624823","block_type":"box","text":"purpose subsidiaries of the foregoing.","page_number":401,"box":{"x":117,"y":835,"width":284,"height":12}},{"id":"5688b84b-37d9-4f9b-9991-e3bdddad569b","block_type":"box","text":"Pools created by private mortgage pass-through issuers generally offer a higher rate of interest than","page_number":401,"box":{"x":117,"y":862,"width":747,"height":12}},{"id":"0d19f247-157b-4b0b-8a06-744df399a777","block_type":"box","text":"government and government-related pools because there are no direct or indirect government or","page_number":401,"box":{"x":116,"y":878,"width":723,"height":12}},{"id":"505de221-493d-476e-8b1f-9f625f3e6799","block_type":"box","text":"II-69","page_number":401,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"026babc3-00f3-403d-a64f-7b5062850525","block_type":"box","text":"NM1026U-6004382-401/605","page_number":401,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"2240a207-f3e8-44c1-ae90-27c30c38bc8b","block_type":"box","text":"agency guarantees of payments in the private pools. However, timely payment of interest and principal","page_number":402,"box":{"x":116,"y":87,"width":767,"height":12}},{"id":"d2c31ffa-c8b7-4dd7-a966-435bacb2fa33","block_type":"box","text":"of these pools may be supported by various forms of insurance or guarantees, including individual","page_number":402,"box":{"x":116,"y":102,"width":732,"height":13}},{"id":"8aad6612-7daf-483f-ad9b-9c1f4d0b986d","block_type":"box","text":"loan, title, pool and hazard insurance and letters of credit. The insurance and guarantees are issued by","page_number":402,"box":{"x":117,"y":118,"width":769,"height":12}},{"id":"de6a629d-9b33-49dd-bcfe-f1badae635ad","block_type":"box","text":"governmental entities, private insurers and the mortgage poolers. The insurance and guarantees and","page_number":402,"box":{"x":116,"y":134,"width":756,"height":12}},{"id":"a05b865b-ed5a-462a-b097-cba5b3cac6f7","block_type":"box","text":"the creditworthiness of the issuers thereof will be considered in determining whether a mortgage","page_number":402,"box":{"x":116,"y":149,"width":720,"height":12}},{"id":"37c35c1e-fefe-42df-907a-bd0ca0170dd7","block_type":"box","text":"related security meets a Fund’s investment quality standards. There can be no assurance that the","page_number":402,"box":{"x":117,"y":165,"width":731,"height":12}},{"id":"b1cb5cb5-c451-4752-b8ec-fe69e30dcc7d","block_type":"box","text":"private insurers or guarantors can meet their obligations under the insurance policies or guarantee","page_number":402,"box":{"x":117,"y":180,"width":734,"height":12}},{"id":"e92ccc48-68ff-4793-af58-6591cbee5d06","block_type":"box","text":"arrangements. Private mortgage pass-through securities may be bought without insurance or","page_number":402,"box":{"x":116,"y":196,"width":696,"height":12}},{"id":"69faded6-c3ef-4cb7-8290-895d72231220","block_type":"box","text":"guarantees if, through an examination of the loan experience and practices of the originator/servicers","page_number":402,"box":{"x":116,"y":211,"width":756,"height":12}},{"id":"40a11baa-e00c-4a8b-85c5-b032c74a26d9","block_type":"box","text":"and poolers, the Manager determines that the securities meet a Fund’s quality standards. Any","page_number":402,"box":{"x":116,"y":227,"width":703,"height":12}},{"id":"42f25708-ec12-4268-97a3-10b7745a6820","block_type":"box","text":"mortgage-related securities that are issued by private issuers have some exposure to subprime loans","page_number":402,"box":{"x":117,"y":242,"width":757,"height":12}},{"id":"768b752b-9ae9-4044-b765-bba74a7e8ea3","block_type":"box","text":"as well as to the mortgage and credit markets generally.","page_number":402,"box":{"x":116,"y":258,"width":422,"height":12}},{"id":"b83b24b8-fbef-43bb-89af-7e5edd6e097b","block_type":"box","text":"In addition, mortgage-related securities that are issued by private issuers are not subject to the","page_number":402,"box":{"x":117,"y":289,"width":707,"height":12}},{"id":"eeefa8c3-5897-48fe-a67b-1078995c711b","block_type":"box","text":"underwriting requirements for the underlying mortgages that are applicable to those mortgage-related","page_number":402,"box":{"x":117,"y":304,"width":757,"height":12}},{"id":"25c4e156-9b61-41a0-a584-fc00cfc15a53","block_type":"box","text":"securities that have a government or government-sponsored entity guarantee. As a result, the","page_number":402,"box":{"x":116,"y":320,"width":702,"height":12}},{"id":"33283923-1438-4c05-8831-d57630d9fb61","block_type":"box","text":"mortgage loans underlying private mortgage-related securities may, and frequently do, have less","page_number":402,"box":{"x":117,"y":335,"width":722,"height":12}},{"id":"dce264a5-98d5-487e-a965-b22f8338c251","block_type":"box","text":"favorable collateral, credit risk or other underwriting characteristics than government or government","page_number":402,"box":{"x":116,"y":351,"width":743,"height":12}},{"id":"50ae62f7-51c4-4812-a21e-04ae2691ab17","block_type":"box","text":"sponsored mortgage-related securities and have wider variances in a number of terms including","page_number":402,"box":{"x":116,"y":366,"width":717,"height":12}},{"id":"cfd946e2-8d03-4315-b4fa-facef89eb271","block_type":"box","text":"interest rate, term, size, purpose and borrower characteristics. Privately issued pools more frequently","page_number":402,"box":{"x":117,"y":382,"width":755,"height":12}},{"id":"7fac1b01-8bd9-4eb9-98c7-45a229cda00f","block_type":"box","text":"include second mortgages, high loan-to-value mortgages and manufactured housing loans. The","page_number":402,"box":{"x":117,"y":397,"width":714,"height":12}},{"id":"ef3677c3-166f-424c-b370-7e037ec34503","block_type":"box","text":"coupon rates and maturities of the underlying mortgage loans in a private-label mortgage-related","page_number":402,"box":{"x":116,"y":413,"width":723,"height":12}},{"id":"6027f9d9-9456-4380-82e5-f56b5bc4863f","block_type":"box","text":"securities pool may vary to a greater extent than those included in a government guaranteed pool, and","page_number":402,"box":{"x":116,"y":428,"width":766,"height":12}},{"id":"6b4df9d6-d7a8-42a8-9f32-2f4b2452d584","block_type":"box","text":"the pool may include subprime mortgage loans. Subprime loans refer to loans made to borrowers with","page_number":402,"box":{"x":116,"y":444,"width":762,"height":12}},{"id":"1e3f8bd9-2c50-4b8e-b4eb-060ade444096","block_type":"box","text":"weakened credit histories or with a lower capacity to make timely payments on their loans. For these","page_number":402,"box":{"x":116,"y":459,"width":751,"height":12}},{"id":"a79ac325-2ac0-4920-8356-d2a467a9bd7a","block_type":"box","text":"reasons, the loans underlying these securities have had in many cases higher default rates than those","page_number":402,"box":{"x":117,"y":475,"width":763,"height":12}},{"id":"bc0967d5-539e-437b-9678-f04024ca299e","block_type":"box","text":"loans that meet government underwriting requirements.","page_number":402,"box":{"x":117,"y":490,"width":416,"height":12}},{"id":"8be2bfc0-bf0d-4881-97f5-9ff4e6206f6d","block_type":"box","text":"The risk of non-payment is greater for mortgage-related securities that are backed by mortgage pools","page_number":402,"box":{"x":116,"y":521,"width":758,"height":12}},{"id":"346ad78c-6eab-4dc8-a03c-1e343ac48314","block_type":"box","text":"that contain subprime loans, but a level of risk exists for all loans. Market factors adversely affecting","page_number":402,"box":{"x":116,"y":537,"width":746,"height":12}},{"id":"a28162b2-cc82-431c-aa3a-c5f3c6bc7fab","block_type":"box","text":"mortgage loan repayments may include a general economic turndown, high unemployment, a general","page_number":402,"box":{"x":117,"y":552,"width":759,"height":12}},{"id":"5d78cb9e-629d-437e-a47b-c71f8f974bbf","block_type":"box","text":"slowdown in the real estate market, a drop in the market prices of real estate, or an increase in interest","page_number":402,"box":{"x":116,"y":568,"width":768,"height":12}},{"id":"664b1adf-6df3-4525-9753-5c5c76e1f6fb","block_type":"box","text":"rates resulting in higher mortgage payments by holders of adjustable rate mortgages.","page_number":402,"box":{"x":117,"y":583,"width":637,"height":12}},{"id":"7688f3c9-243a-4917-93eb-021061358c1a","block_type":"box","text":"Privately issued mortgage-related securities are not traded on an exchange and there may be a limited","page_number":402,"box":{"x":117,"y":614,"width":767,"height":12}},{"id":"40e073fd-9a40-4632-ac24-856728ebfd36","block_type":"box","text":"market for the securities, especially when there is a perceived weakness in the mortgage and real","page_number":402,"box":{"x":117,"y":630,"width":729,"height":12}},{"id":"2e7891bf-9907-4e96-9bb4-97181d6511a5","block_type":"box","text":"estate market sectors. Without an active trading market, mortgage-related securities held in a Fund’s","page_number":402,"box":{"x":116,"y":645,"width":753,"height":12}},{"id":"92df225d-5756-4633-826f-223067c54699","block_type":"box","text":"portfolio may be particularly difficult to value because of the complexities involved in assessing the","page_number":402,"box":{"x":117,"y":661,"width":729,"height":12}},{"id":"25588c72-094d-42f1-92ec-46f18766de75","block_type":"box","text":"value of the underlying mortgage loans.","page_number":402,"box":{"x":116,"y":676,"width":293,"height":12}},{"id":"f16502cd-c25d-40f5-bd9d-af6b1b047f9f","block_type":"box","text":"Collateralized Mortgage Obligations (“CMOs”).","page_number":402,"box":{"x":117,"y":707,"width":343,"height":12}},{"id":"9627ed31-72b4-4786-a1f4-5b06bee89638","block_type":"box","text":"CMOs are debt obligations collateralized by residential","page_number":402,"box":{"x":467,"y":707,"width":404,"height":12}},{"id":"a33bb062-76dd-48ed-928f-91bdee12a486","block_type":"box","text":"or commercial mortgage loans or residential or commercial mortgage pass-through securities. Interest","page_number":402,"box":{"x":116,"y":723,"width":758,"height":12}},{"id":"8517edb0-2f43-490c-81d8-33ebc2e63f64","block_type":"box","text":"and prepaid principal are generally paid monthly. CMOs may be collateralized by whole mortgage","page_number":402,"box":{"x":116,"y":738,"width":724,"height":12}},{"id":"31b8a8e3-6b0c-4de2-b4b6-23a792e63182","block_type":"box","text":"loans or private mortgage pass-through securities but are more typically collateralized by portfolios of","page_number":402,"box":{"x":117,"y":754,"width":751,"height":12}},{"id":"5edf79c3-275b-4b33-9061-7b6c1e7966ac","block_type":"box","text":"mortgage pass-through securities guaranteed by Ginnie Mae, Freddie Mac, or Fannie Mae. The issuer","page_number":402,"box":{"x":117,"y":769,"width":761,"height":12}},{"id":"d8c1c951-5aff-4aef-8746-f78195413222","block_type":"box","text":"of a series of CMOs may elect to be treated as a Real Estate Mortgage Investment Conduit (“REMIC”).","page_number":402,"box":{"x":116,"y":785,"width":763,"height":12}},{"id":"bd904e6b-e92e-4c60-9c0a-f0181c3a84eb","block_type":"box","text":"All future references to CMOs also include REMICs.","page_number":402,"box":{"x":116,"y":800,"width":386,"height":10}},{"id":"bbbf2576-701f-4404-8d56-26e9811726ae","block_type":"box","text":"CMOs are structured into multiple classes, often referred to as a “tranche,” each issued at a specific","page_number":402,"box":{"x":117,"y":831,"width":746,"height":12}},{"id":"ead6999d-93b1-4adc-b21d-226720bd8248","block_type":"box","text":"adjustable or fixed interest rate, and bearing a different stated maturity date and each must be fully","page_number":402,"box":{"x":116,"y":847,"width":738,"height":12}},{"id":"05233078-508b-4289-baed-95e0fdfa8c06","block_type":"box","text":"retired no later than its final distribution date. Actual maturity and average life will depend upon the","page_number":402,"box":{"x":117,"y":862,"width":734,"height":12}},{"id":"edae7560-a9c6-414e-a24c-60763fea88cc","block_type":"box","text":"prepayment experience of the collateral, which is ordinarily unrelated to the stated maturity date.","page_number":402,"box":{"x":117,"y":878,"width":719,"height":12}},{"id":"23ae79b7-f3ea-47d2-8aa9-c8e0eb67b2bd","block_type":"box","text":"II-70","page_number":402,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"3c366251-28f2-4045-971e-43f399eec634","block_type":"box","text":"NM1026U-6004382-402/605","page_number":402,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5a012ea3-372c-475d-a35d-db539b2182a1","block_type":"box","text":"CMOs often provide for a modified form of call protection through a de facto breakdown of the","page_number":403,"box":{"x":117,"y":87,"width":700,"height":12}},{"id":"425e7b72-4172-4945-baf4-bcb72f1b20ba","block_type":"box","text":"underlying pool of mortgages according to how quickly the loans are repaid. Monthly payment of","page_number":403,"box":{"x":117,"y":102,"width":718,"height":13}},{"id":"f3498a09-ba1b-4f6b-ab27-6ac235644731","block_type":"box","text":"principal received from the pool of underlying mortgages, including prepayments, is first returned to","page_number":403,"box":{"x":117,"y":118,"width":740,"height":12}},{"id":"c2e54784-f41b-4c6e-a2df-e2ddf6da0856","block_type":"box","text":"investors holding the shortest maturity class. Investors holding the longer maturity classes usually","page_number":403,"box":{"x":117,"y":134,"width":729,"height":12}},{"id":"ccabb260-97ec-4755-a01f-ff2e96d4d0f0","block_type":"box","text":"receive principal only after the first class has been retired. An investor may be partially protected","page_number":403,"box":{"x":117,"y":149,"width":719,"height":12}},{"id":"11db6074-85ea-4382-ae0a-44687890b0ff","block_type":"box","text":"against a sooner than desired return of principal because of the sequential payments.","page_number":403,"box":{"x":116,"y":165,"width":640,"height":12}},{"id":"9f4ae210-d52a-4eec-80c1-373124d28203","block_type":"box","text":"Certain issuers of CMOs are not considered investment companies pursuant to a rule adopted by the","page_number":403,"box":{"x":117,"y":196,"width":755,"height":12}},{"id":"cf574260-feea-4fd1-9100-0b8d513ee7aa","block_type":"box","text":"Commission, and a Fund may invest in the securities of such issuers without the limitations imposed by","page_number":403,"box":{"x":117,"y":211,"width":771,"height":12}},{"id":"cd2e1c4b-4947-4c66-88eb-7b1e38125786","block_type":"box","text":"the Investment Company Act on investments by a Fund in other investment companies. In addition, in","page_number":403,"box":{"x":116,"y":227,"width":761,"height":12}},{"id":"531c0517-5efa-44f3-a681-4ee95e52c089","block_type":"box","text":"reliance on an earlier Commission interpretation, a Fund’s investments in certain other qualifying","page_number":403,"box":{"x":117,"y":242,"width":721,"height":12}},{"id":"46803e99-624d-40bd-92ef-8fc59935767a","block_type":"box","text":"CMOs, which cannot or do not rely on the rule, are also not subject to the limitation of the Investment","page_number":403,"box":{"x":117,"y":258,"width":753,"height":12}},{"id":"3492a9ee-7ace-4481-bb82-095397c5174e","block_type":"box","text":"Company Act on acquiring interests in other investment companies. In order to be able to rely on the","page_number":403,"box":{"x":117,"y":273,"width":750,"height":12}},{"id":"bdd0300e-21de-4976-9611-bb70160a6dd7","block_type":"box","text":"Commission’s interpretation, these CMOs must be unmanaged, fixed asset issuers, that: (1) invest","page_number":403,"box":{"x":117,"y":289,"width":736,"height":12}},{"id":"ad7f2d34-9df8-46c1-8963-b315491dac5c","block_type":"box","text":"primarily in mortgage-backed securities; (2) do not issue redeemable securities; (3) operate under","page_number":403,"box":{"x":117,"y":304,"width":730,"height":12}},{"id":"b35787e2-2895-4d76-a764-cfc0d1c059bd","block_type":"box","text":"general exemptive orders exempting them from all provisions of the Investment Company Act; and","page_number":403,"box":{"x":116,"y":320,"width":736,"height":12}},{"id":"b23d9140-6ebb-43a0-abb1-3a74a1a6ab9f","block_type":"box","text":"(4) are not registered or regulated under the Investment Company Act as investment companies. To","page_number":403,"box":{"x":117,"y":335,"width":748,"height":12}},{"id":"d8f4ffff-25ad-43d7-a9d3-b1f78fb3dd0e","block_type":"box","text":"the extent that a Fund selects CMOs that cannot rely on the rule or do not meet the above","page_number":403,"box":{"x":116,"y":351,"width":674,"height":12}},{"id":"d6bf8cda-69d5-4dc3-9175-a3c3ed9ec8bb","block_type":"box","text":"requirements, the Fund may not invest more than 10% of its assets in all such entities and may not","page_number":403,"box":{"x":117,"y":366,"width":738,"height":12}},{"id":"a922d247-d6c0-4c12-a939-fc020a070644","block_type":"box","text":"acquire more than 3% of the voting securities of any single such entity.","page_number":403,"box":{"x":116,"y":382,"width":530,"height":12}},{"id":"f32c2d2e-b98c-45c7-9b5c-5e184ba342bc","block_type":"box","text":"A Fund may also invest in, among other things, parallel pay CMOs, sequential pay CMOs, and floating","page_number":403,"box":{"x":116,"y":413,"width":765,"height":12}},{"id":"014da21b-59ce-44fd-8a3e-00ea2dec34ed","block_type":"box","text":"rate CMOs. Parallel pay CMOs are structured to provide payments of principal on each payment date","page_number":403,"box":{"x":117,"y":428,"width":757,"height":12}},{"id":"48c6281b-ddcf-4916-824a-b1b2f2b43b32","block_type":"box","text":"to more than one class, concurrently on a proportionate or disproportionate basis. These simultaneous","page_number":403,"box":{"x":116,"y":444,"width":766,"height":12}},{"id":"996a493a-1779-4f10-9739-1d71aa53205e","block_type":"box","text":"payments are taken into account in calculating the final distribution date of each class. Sequential pay","page_number":403,"box":{"x":117,"y":459,"width":759,"height":12}},{"id":"87697db4-c012-4b84-a914-0450f1402926","block_type":"box","text":"CMOs generally pay principal to only one class at a time while paying interest to several classes. A","page_number":403,"box":{"x":117,"y":475,"width":739,"height":12}},{"id":"c95004a2-f5eb-456b-a586-1e628a3c4ed5","block_type":"box","text":"wide variety of REMIC Certificates may be issued in the parallel pay or sequential pay structures.","page_number":403,"box":{"x":116,"y":490,"width":726,"height":12}},{"id":"4ed706a5-f2d2-4f62-a764-f522a816e94e","block_type":"box","text":"These securities include accrual certificates (also known as “Z-Bonds”), which only accrue interest at a","page_number":403,"box":{"x":116,"y":506,"width":767,"height":12}},{"id":"926ecd35-3686-4b4f-b27d-3e82b52d5200","block_type":"box","text":"specified rate until all other certificates having an earlier final distribution date have been retired and","page_number":403,"box":{"x":116,"y":521,"width":746,"height":12}},{"id":"27874164-b21c-4960-81b1-afbd9fb2f8ff","block_type":"box","text":"are converted thereafter to an interest-paying security. Floating rate CMOs are securities whose","page_number":403,"box":{"x":116,"y":537,"width":718,"height":12}},{"id":"47cdb5eb-5008-49e4-a301-13e4304c5c08","block_type":"box","text":"coupon rate fluctuates according to some formula related to an existing market index or rate. Typical","page_number":403,"box":{"x":116,"y":552,"width":750,"height":12}},{"id":"fa81cfdb-c3cb-4041-b070-8cc31511f3ef","block_type":"box","text":"indices would include the eleventh district cost-of-funds index (“COFI”), one-year Treasury yields, and","page_number":403,"box":{"x":117,"y":568,"width":758,"height":12}},{"id":"992aa445-a142-468e-a871-4d936e1e9562","block_type":"box","text":"ten-year Treasury yields.","page_number":403,"box":{"x":116,"y":583,"width":190,"height":12}},{"id":"c41fd821-c4c9-4d8a-90d8-cae0fe28db2c","block_type":"box","text":"Classes of CMOs also include planned amortization","page_number":403,"box":{"x":117,"y":614,"width":380,"height":12}},{"id":"48e27254-cdc7-4c36-a03e-d65579c00dbe","block_type":"box","text":"classes (“PACs”) and targeted amortization classes","page_number":403,"box":{"x":498,"y":614,"width":378,"height":12}},{"id":"8a24e1d4-9fab-4817-9760-377d21f0e1b3","block_type":"box","text":"(“TACs”). PAC bonds generally require payments of a s","page_number":403,"box":{"x":117,"y":630,"width":402,"height":12}},{"id":"543fb431-4917-4793-beff-5be9cea40484","block_type":"box","text":"pecified amount of principal on each payment","page_number":403,"box":{"x":521,"y":630,"width":334,"height":12}},{"id":"dce76c35-80f3-4e5f-b846-08571a0e1902","block_type":"box","text":"date. The scheduled principal payments for PAC Certifi","page_number":403,"box":{"x":116,"y":645,"width":399,"height":12}},{"id":"cbe1a8fd-627b-4084-894c-fb48f9b7ebdd","block_type":"box","text":"cates generally have the highest priority on each","page_number":403,"box":{"x":517,"y":645,"width":357,"height":12}},{"id":"9b7c67a6-7487-4102-848b-afe51d53bd65","block_type":"box","text":"payment date after interest due has been paid to all","page_number":403,"box":{"x":117,"y":661,"width":373,"height":12}},{"id":"b8480fe3-5a4b-4c6e-b638-9e9a133417df","block_type":"box","text":"classes entitled to receive interest currently.","page_number":403,"box":{"x":496,"y":661,"width":317,"height":12}},{"id":"3e33ddfe-5b01-4a85-a1af-018b4905daa5","block_type":"box","text":"Shortfalls, if any, are added to the amount payabl","page_number":403,"box":{"x":116,"y":676,"width":357,"height":12}},{"id":"ec6ae995-019d-4c3a-90e7-0dd50c5dfc69","block_type":"box","text":"e on the next payment date. The PAC Certificate","page_number":403,"box":{"x":475,"y":676,"width":353,"height":12}},{"id":"65b83f30-ae98-4905-b0b5-9e35a3862823","block_type":"box","text":"payment schedule is taken into account in calculating","page_number":403,"box":{"x":117,"y":692,"width":386,"height":12}},{"id":"cfdba831-6288-4b22-b821-c53bd83a0ce5","block_type":"box","text":"the final distribution date of each class of PAC. In","page_number":403,"box":{"x":508,"y":692,"width":357,"height":9}},{"id":"78ac34f7-8f65-4df7-bb8e-a8fd5870e1f7","block_type":"box","text":"order to create PAC tranches, one or more tranches gener","page_number":403,"box":{"x":116,"y":707,"width":426,"height":12}},{"id":"1c682e66-7eb7-4378-b917-f1261dd04769","block_type":"box","text":"ally must be created that absorb most of the","page_number":403,"box":{"x":542,"y":707,"width":320,"height":12}},{"id":"e60af286-adaf-42ad-aeca-dd71bfaf0947","block_type":"box","text":"volatility in the underlying mortgage assets. These","page_number":403,"box":{"x":116,"y":723,"width":364,"height":12}},{"id":"41385442-bded-4240-a53e-24346e889921","block_type":"box","text":"tranches (often called “supports” or “companion”","page_number":403,"box":{"x":485,"y":723,"width":351,"height":12}},{"id":"d1a49d23-2187-4040-9758-69dd51d790ab","block_type":"box","text":"tranches) tend to have market prices and yields","page_number":403,"box":{"x":116,"y":738,"width":345,"height":12}},{"id":"dc3e56c2-1117-4814-824c-b2e832e0fb83","block_type":"box","text":"that are more volatile than the PAC classes.","page_number":403,"box":{"x":466,"y":738,"width":319,"height":10}},{"id":"9ca93df9-c094-4841-8ed9-12f891b24cf5","block_type":"box","text":"TACs are similar to PACs in that they require that specified amounts of principal be applied on each","page_number":403,"box":{"x":116,"y":769,"width":739,"height":12}},{"id":"fb54ff08-8ddd-49ad-9f2c-aaf9463040a5","block_type":"box","text":"payment date to one or more classes of REMIC Certificates. A PAC’s payment schedule, however,","page_number":403,"box":{"x":117,"y":785,"width":732,"height":12}},{"id":"14e41650-a36e-4ff0-85cd-2bd501591fbd","block_type":"box","text":"remains in effect as long as prepayment rates on the underlying mortgages do not exceed certain","page_number":403,"box":{"x":117,"y":800,"width":722,"height":12}},{"id":"ae354425-4391-4f3a-aedd-89019b72d991","block_type":"box","text":"ranges. In contrast, a TAC provides investors with protection, to a certain level, against either faster","page_number":403,"box":{"x":117,"y":816,"width":738,"height":12}},{"id":"e8ae925b-837d-4357-bddc-a65df23bcb05","block_type":"box","text":"than expected or slower than expected prepayment rates, but not both. TACs thus provide more cash","page_number":403,"box":{"x":116,"y":831,"width":759,"height":12}},{"id":"0447ef1b-0cf0-421d-a6b8-56c07d791ab7","block_type":"box","text":"flow stability than a regular sequential paying class, but less than a PAC. TACs also tend to have","page_number":403,"box":{"x":116,"y":847,"width":725,"height":12}},{"id":"f022fe23-c5d6-4a9e-8f5f-591ca00ce8b9","block_type":"box","text":"market prices and yields that are more volatile than PACs.","page_number":403,"box":{"x":117,"y":862,"width":437,"height":12}},{"id":"624900ce-3d6e-476e-9c3e-35e380344cbe","block_type":"box","text":"II-71","page_number":403,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"4bd7a722-c974-4054-b147-6688fec0df0b","block_type":"box","text":"NM1026U-6004382-403/605","page_number":403,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"1ddfafe2-2791-4e2f-a65f-0f059922c7c8","block_type":"box","text":"Adjustable Rate Mortgage Securities.","page_number":404,"box":{"x":115,"y":87,"width":277,"height":12}},{"id":"798cb6cd-65f5-4cf1-b911-0ea74b9ef155","block_type":"box","text":"Adjustable rate mortgage securities (“ARMs”) are pass-through","page_number":404,"box":{"x":393,"y":87,"width":479,"height":12}},{"id":"8860c9d0-5485-4017-bfb6-6940fb21a487","block_type":"box","text":"securities collateralized by mortgages with adjustable rather than fixed rates. ARMs eligible for","page_number":404,"box":{"x":116,"y":102,"width":706,"height":13}},{"id":"363aa262-d6f3-4d5e-8e85-61edc85900ed","block_type":"box","text":"inclusion in a mortgage pool generally provide for a fixed initial mortgage interest rate for a set number","page_number":404,"box":{"x":117,"y":118,"width":764,"height":12}},{"id":"3d91e5ab-b0cc-46f8-9cb6-f102a25ebabc","block_type":"box","text":"of scheduled monthly payments. After that schedule of payments has been completed, the interest","page_number":404,"box":{"x":116,"y":134,"width":736,"height":12}},{"id":"a8ede814-9b4d-4c7f-999c-c62efbe8340a","block_type":"box","text":"rates are subject to periodic adjustment based on changes to a designated benchmark index.","page_number":404,"box":{"x":117,"y":149,"width":697,"height":12}},{"id":"1e62bda2-99e5-4da4-b47c-fb4387a32681","block_type":"box","text":"ARMs contain maximum and minimum rates beyond which the mortgage interest rate may not vary","page_number":404,"box":{"x":116,"y":180,"width":741,"height":12}},{"id":"dc19ee68-207b-4ab5-9eda-5c03d7bf284b","block_type":"box","text":"over the lifetime of the security. In addition, certain ARMs provide for additional limitations on the","page_number":404,"box":{"x":116,"y":196,"width":722,"height":12}},{"id":"7a673596-d179-4bdf-add2-63e8d120b301","block_type":"box","text":"maximum amount by which the mortgage interest rate may adjust for any single adjustment period. In","page_number":404,"box":{"x":117,"y":211,"width":758,"height":12}},{"id":"6bef492a-80f9-4bd7-af84-96ca84c9a743","block_type":"box","text":"the event that market rates of interest rise more rapidly to levels above that of the ARM’s maximum","page_number":404,"box":{"x":116,"y":227,"width":741,"height":12}},{"id":"112ac98e-6104-4160-ac50-18ae16fbfc98","block_type":"box","text":"rate, the ARM’s coupon may represent a below market rate of interest. In these circumstances, the","page_number":404,"box":{"x":117,"y":242,"width":737,"height":12}},{"id":"7013d0a4-5159-47d5-b52d-b5026d8dfb8e","block_type":"box","text":"market value of the ARM security will likely have fallen.","page_number":404,"box":{"x":117,"y":258,"width":412,"height":12}},{"id":"7bb7de17-bc8a-4da5-97b2-5071ff803b95","block_type":"box","text":"Certain ARMs contain limitations on changes in the required monthly payment. In the event that a","page_number":404,"box":{"x":117,"y":289,"width":728,"height":12}},{"id":"e65da948-789f-482f-a644-2b6f9558e35a","block_type":"box","text":"monthly payment is not sufficient to pay the interest accruing on an ARM, any such excess interest is","page_number":404,"box":{"x":117,"y":304,"width":754,"height":12}},{"id":"3706913b-2be0-471d-8074-6437845d0dc5","block_type":"box","text":"added to the principal balance of the mortgage loan, which is repaid through future monthly payments.","page_number":404,"box":{"x":116,"y":320,"width":764,"height":12}},{"id":"9a0f0783-c87e-4142-a152-778e064e97ab","block_type":"box","text":"If the monthly payment for such an instrument exceeds the sum of the interest accrued at the","page_number":404,"box":{"x":117,"y":335,"width":695,"height":12}},{"id":"853918eb-764d-439a-b96c-8232f12f0370","block_type":"box","text":"applicable mortgage interest rate and the principal payment required at such point to amortize the","page_number":404,"box":{"x":116,"y":351,"width":730,"height":12}},{"id":"f6a25ab7-9600-4a8c-8f9a-e8063e128112","block_type":"box","text":"outstanding principal balance over the remaining term of the loan, the excess is then used to reduce","page_number":404,"box":{"x":116,"y":366,"width":748,"height":12}},{"id":"581a5ee5-7cf7-45f6-af45-78286d5dff0a","block_type":"box","text":"the outstanding principal balance of the ARM.","page_number":404,"box":{"x":116,"y":382,"width":344,"height":12}},{"id":"fdf8cc5c-7a86-4447-854b-34de1a0cebc6","block_type":"box","text":"CMO Residuals.","page_number":404,"box":{"x":117,"y":413,"width":120,"height":9}},{"id":"e8a93a65-6bde-4cce-8dd0-5eb96ce7a1f5","block_type":"box","text":"CMO residuals are derivative mortgage securities issued by agencies or","page_number":404,"box":{"x":238,"y":413,"width":546,"height":12}},{"id":"0211c82e-4a63-47ff-8794-5a48663e0a0d","block_type":"box","text":"instrumentalities of the U.S. Government or by private originators of, or investors in, mortgage loans,","page_number":404,"box":{"x":117,"y":428,"width":750,"height":12}},{"id":"b827677f-ffad-4c3a-bf3c-5c4b4d2b763e","block_type":"box","text":"including savings and loan associations, homebuilders, mortgage banks, commercial banks,","page_number":404,"box":{"x":117,"y":444,"width":688,"height":12}},{"id":"154a40c4-9baf-48b9-912d-9fa8ae1dbdab","block_type":"box","text":"investment banks, and special purpose entities of the foregoing. The cash flow generated by the","page_number":404,"box":{"x":117,"y":459,"width":718,"height":12}},{"id":"07b264ba-c273-408f-b68b-3767293b4103","block_type":"box","text":"mortgage assets underlying a series of CMOs is applied first to make required payments of principal","page_number":404,"box":{"x":117,"y":475,"width":747,"height":12}},{"id":"60fc1d85-c258-4dec-81d6-51ee7ebf111c","block_type":"box","text":"and interest on the CMOs and second to pay the related administrative expenses and any","page_number":404,"box":{"x":116,"y":490,"width":673,"height":12}},{"id":"98c1c5ad-f1ec-42d9-a23e-92ea7abc97a2","block_type":"box","text":"management fees of the issuer. The residual in a CMO structure generally represents the interest in","page_number":404,"box":{"x":117,"y":506,"width":746,"height":12}},{"id":"3cbfc6b3-a5aa-4a74-9ede-83eebfc2d1d9","block_type":"box","text":"any excess cash flow remaining after making the foregoing payments. Each payment of such excess","page_number":404,"box":{"x":116,"y":521,"width":753,"height":12}},{"id":"5dc7b034-d2a8-4019-80dd-bdd885570347","block_type":"box","text":"cash flow to a holder of the related CMO residual represents income and/or a return of capital. The","page_number":404,"box":{"x":116,"y":537,"width":738,"height":12}},{"id":"7d60ecb1-639c-4057-b0cb-b8190d08be9b","block_type":"box","text":"amount of residual cash flow resulting from a CMO will depend on, among other things, the","page_number":404,"box":{"x":116,"y":552,"width":681,"height":12}},{"id":"9b4fd01f-dd5e-4187-a706-b17626cd12d4","block_type":"box","text":"characteristics of the mortgage assets, the coupon rate of each class of CMO, prevailing interest rates,","page_number":404,"box":{"x":116,"y":568,"width":768,"height":12}},{"id":"eff75247-d411-4f0b-943f-4d69d06da787","block_type":"box","text":"the amount of administrative expenses and the prepayment experience on the mortgage assets. In","page_number":404,"box":{"x":116,"y":583,"width":738,"height":12}},{"id":"8b5937db-f58f-4526-91c7-6849db9d1b04","block_type":"box","text":"part, the yield to maturity on the CMO residuals is extremely sensitive to prepayments on the related","page_number":404,"box":{"x":117,"y":599,"width":748,"height":12}},{"id":"1bf32f47-3d38-4456-b5be-578e7b858978","block_type":"box","text":"underlying mortgage assets, in the same manner as an interest-only class of stripped mortgage-related","page_number":404,"box":{"x":117,"y":614,"width":770,"height":12}},{"id":"cc44b60a-9e65-497d-8ec3-cb1ddef2b100","block_type":"box","text":"securities. In addition, if a series of a CMO includes a class that bears interest at an adjustable rate,","page_number":404,"box":{"x":116,"y":630,"width":746,"height":12}},{"id":"0eb074d6-c74b-4768-b590-f6b1044e554a","block_type":"box","text":"the yield to maturity on the related CMO residual will also be extremely sensitive to changes in the","page_number":404,"box":{"x":116,"y":645,"width":733,"height":12}},{"id":"328b73b0-b0cd-44b4-9197-38f90551d29f","block_type":"box","text":"level of the index upon which interest rate adjustments are based. In certain circumstances, a Fund","page_number":404,"box":{"x":117,"y":661,"width":735,"height":12}},{"id":"a9faa3be-9bcf-4559-893a-1eba0f7a4013","block_type":"box","text":"may fail to recoup fully its initial investment in a CMO residual.","page_number":404,"box":{"x":117,"y":676,"width":459,"height":12}},{"id":"21e451c4-df2a-4c2d-83a1-608b3c1d887e","block_type":"box","text":"CMO residuals are generally purchased and sold by institutional investors through one or more","page_number":404,"box":{"x":117,"y":707,"width":704,"height":12}},{"id":"d294df24-ea5f-45ab-b73f-3e429c450a3b","block_type":"box","text":"investment banking firms acting as brokers or dealers. Transactions in CMO residuals are generally","page_number":404,"box":{"x":117,"y":723,"width":739,"height":12}},{"id":"da24a38c-27ce-4477-b613-37c5d74ebc65","block_type":"box","text":"completed only after careful review of the characteristics of the securities in question. In addition, CMO","page_number":404,"box":{"x":116,"y":738,"width":763,"height":12}},{"id":"ad92837f-3403-415a-93c7-c74fbeafd687","block_type":"box","text":"residuals may or, pursuant to an exemption therefrom, may not have been registered under the","page_number":404,"box":{"x":117,"y":754,"width":706,"height":12}},{"id":"fb1e668a-2c8a-44b8-8b6d-d25bbdad981c","block_type":"box","text":"Securities Act. Residual interests generally are junior to, and may be significantly more volatile than,","page_number":404,"box":{"x":116,"y":769,"width":742,"height":12}},{"id":"d9989ea8-2672-468b-8789-e725e65b884b","block_type":"box","text":"“regular” CMO and REMIC interests. CMO residuals, whether or not registered under the Securities","page_number":404,"box":{"x":116,"y":785,"width":739,"height":12}},{"id":"0ac78280-3070-42da-9faf-c64ca7bec50f","block_type":"box","text":"Act, may be subject to certain restrictions on transferability.","page_number":404,"box":{"x":116,"y":800,"width":438,"height":12}},{"id":"d0c89b65-1724-4e5f-9204-f7cb15c039f0","block_type":"box","text":"Stripped Mortgage-Backed Securities.","page_number":404,"box":{"x":117,"y":831,"width":280,"height":12}},{"id":"a10ff500-1d82-4f58-b051-262686a37fa2","block_type":"box","text":"A Fund may invest in stripped mortgage-backed securities","page_number":404,"box":{"x":399,"y":831,"width":443,"height":12}},{"id":"2731af7c-fe3a-4e8d-8f73-82b13cfe3068","block_type":"box","text":"(“SMBSs”) issued by agencies or instrumentalities of the United States. SMBSs are derivative multi","page_number":404,"box":{"x":117,"y":847,"width":740,"height":12}},{"id":"55bc548e-fca0-4f2d-a8eb-7b25b79a7cf9","block_type":"box","text":"class mortgage-backed securities. SMBS arrangements commonly involve two classes of securities","page_number":404,"box":{"x":116,"y":862,"width":744,"height":12}},{"id":"0c27705a-c06f-49f2-8600-f78faaf8d182","block_type":"box","text":"that receive different proportions of the interest and principal distributions on a pool of mortgage","page_number":404,"box":{"x":116,"y":878,"width":716,"height":12}},{"id":"055f69c8-853d-4bb5-8f78-2800a5ddcaa8","block_type":"box","text":"II-72","page_number":404,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"eadc99e7-a466-4582-bf02-4cc13212dc24","block_type":"box","text":"NM1026U-6004382-404/605","page_number":404,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"40485b70-5b6f-4db0-bc83-0f9301baaefe","block_type":"box","text":"assets. A common variety of SMBS is where one class (the principal only or PO class) receives some","page_number":405,"box":{"x":116,"y":87,"width":759,"height":12}},{"id":"5a2b45ce-402b-4850-86dc-67c3c53a7a05","block_type":"box","text":"of the interest and most of the principal from the underlying assets, while the other class (the interest","page_number":405,"box":{"x":116,"y":102,"width":752,"height":13}},{"id":"a1d3ede5-ab82-493c-8fb2-dd36893b5b9b","block_type":"box","text":"only or IO class) receives most of the interest and the remainder of the principal. In the most extreme","page_number":405,"box":{"x":116,"y":118,"width":755,"height":12}},{"id":"def3fe65-3fb9-4203-82ed-38a436e63118","block_type":"box","text":"case, the IO class receives all of the interest, while","page_number":405,"box":{"x":116,"y":134,"width":382,"height":11}},{"id":"d9760b6b-ddf4-4b68-bb81-63b3e8cc0620","block_type":"box","text":"the PO class receives all of the principal. While a","page_number":405,"box":{"x":498,"y":134,"width":368,"height":11}},{"id":"9f7ae50b-7210-493c-a483-104170260474","block_type":"box","text":"Fund may purchase securities of a PO class, a Fund is more likely to purchase the securities of an IO","page_number":405,"box":{"x":117,"y":149,"width":758,"height":12}},{"id":"df333a63-d589-40d6-bc7c-ef4b3779bfc9","block_type":"box","text":"class. The yield to maturity of an IO class is extremely sensitive to the rate of principal payments","page_number":405,"box":{"x":116,"y":165,"width":720,"height":12}},{"id":"3333293c-dcb7-4243-8d0c-933952e7d70b","block_type":"box","text":"(including prepayments) on the related underlying assets, and a rapid rate of principal prepayments in","page_number":405,"box":{"x":117,"y":180,"width":759,"height":12}},{"id":"964dfea1-9f69-4c12-bc67-f4f3b752dbbd","block_type":"box","text":"excess of that considered in pricing the securities will have a material adverse effect on an IO","page_number":405,"box":{"x":116,"y":196,"width":699,"height":12}},{"id":"fef8f163-3bb3-4215-bd4f-74c561955bdf","block_type":"box","text":"security’s yield to maturity. If the underlying mortgage assets experience greater than anticipated","page_number":405,"box":{"x":116,"y":211,"width":724,"height":12}},{"id":"527f8204-d60c-4017-841a-d56fbbce299f","block_type":"box","text":"payments of principal, a Fund may fail to recoup fully its initial investment in IOs. In addition, there are","page_number":405,"box":{"x":117,"y":227,"width":760,"height":12}},{"id":"2b729bdb-f2e6-4585-bbd2-1ce823c21eeb","block_type":"box","text":"certain types of IOs that represent the interest portion of a particular class as opposed to the interest","page_number":405,"box":{"x":116,"y":242,"width":751,"height":12}},{"id":"3fb9ade5-6257-41ad-b550-d9db5bdb8e76","block_type":"box","text":"portion of the entire pool. The sensitivity of this type of IO to interest rate fluctuations may be increased","page_number":405,"box":{"x":117,"y":258,"width":768,"height":12}},{"id":"dc3c01e4-c290-4408-834f-695aa87a2ef5","block_type":"box","text":"because of the characteristics of the principal portion to which they relate. As a result of the above","page_number":405,"box":{"x":117,"y":273,"width":733,"height":12}},{"id":"ee49f266-2efc-4808-9e19-20ffc93c62ab","block_type":"box","text":"factors, a Fund generally will purchase IOs only as a component of so called “synthetic” securities. This","page_number":405,"box":{"x":116,"y":289,"width":772,"height":12}},{"id":"ebc4cb40-ddff-4a4e-8158-80e868a277c4","block_type":"box","text":"means that purchases of IOs will be matched with certain purchases of other securities, such as POs,","page_number":405,"box":{"x":117,"y":304,"width":759,"height":12}},{"id":"74f5cee5-1ed5-4fab-bac9-937d4153494f","block_type":"box","text":"inverse floating rate CMOs or fixed rate securities; as interest rates fall, presenting a greater risk of","page_number":405,"box":{"x":117,"y":320,"width":737,"height":12}},{"id":"976b3667-043b-40e4-9122-acecdc2f53db","block_type":"box","text":"unanticipated prepayments of principal, the negative effect on a Fund because of its holdings of IOs","page_number":405,"box":{"x":117,"y":335,"width":744,"height":12}},{"id":"a22a6c42-9ace-4668-b303-1b05d367b8da","block_type":"box","text":"should be diminished somewhat because of the increased yield on the inverse floating rate CMOs or","page_number":405,"box":{"x":116,"y":351,"width":751,"height":12}},{"id":"e324e0b5-5832-4c41-95a1-76158b1d0026","block_type":"box","text":"the increased appreciation on the POs or fixed rate securities.","page_number":405,"box":{"x":116,"y":366,"width":465,"height":12}},{"id":"feeb9ad4-b57b-44e4-88d0-ac4569f18dbe","block_type":"box","text":"Tiered Index Bonds.","page_number":405,"box":{"x":118,"y":397,"width":141,"height":10}},{"id":"aba1b361-03b8-4801-a62b-6b3f79cd68b7","block_type":"box","text":"Tiered index bonds are forms of mortgage-related securities. The interest rate on a","page_number":405,"box":{"x":260,"y":397,"width":597,"height":12}},{"id":"6a229569-b8b6-4f01-9404-228416231ac7","block_type":"box","text":"tiered index bond is tied to a specified index or market ra","page_number":405,"box":{"x":116,"y":413,"width":402,"height":12}},{"id":"2acda92d-ac24-49c4-95cd-b53c99428d6e","block_type":"box","text":"te. So long as this index or market rate is below a","page_number":405,"box":{"x":518,"y":413,"width":356,"height":12}},{"id":"31e5a4f3-83eb-4036-ad86-67d9263ccb5f","block_type":"box","text":"predetermined “strike” rate, the interest rate on t","page_number":405,"box":{"x":117,"y":428,"width":340,"height":12}},{"id":"c959af60-d0d2-470e-a84c-eb9ce5f44931","block_type":"box","text":"he tiered index bond remains fixed. If, however, the","page_number":405,"box":{"x":457,"y":428,"width":368,"height":11}},{"id":"5deda9b7-8527-419e-bb8b-cc223ca91388","block_type":"box","text":"specified index or market rate rises above the “strike","page_number":405,"box":{"x":116,"y":444,"width":372,"height":12}},{"id":"9619f575-54e4-4526-9ae4-39af89c02a76","block_type":"box","text":"” rate, the interest rate of the tiered index bond will","page_number":405,"box":{"x":488,"y":444,"width":361,"height":11}},{"id":"bc37f769-b181-449a-83f2-e070e78dfed7","block_type":"box","text":"decrease. Thus, under these circumstances, the interest","page_number":405,"box":{"x":116,"y":459,"width":401,"height":11}},{"id":"88d4215b-5449-43c8-a900-af26a5b9d4c0","block_type":"box","text":"t rate on a tiered index bond, like an inverse floater,","page_number":405,"box":{"x":517,"y":459,"width":364,"height":11}},{"id":"397374db-4549-4664-9735-d8b51a24e7db","block_type":"box","text":"will move in the opposite direction of prevailing interest ra","page_number":405,"box":{"x":116,"y":475,"width":405,"height":12}},{"id":"29dbacad-0e29-4e9d-9ead-71674b7348c6","block_type":"box","text":"tes, with the result that t","page_number":405,"box":{"x":522,"y":475,"width":169,"height":11}},{"id":"94e7307d-2232-4bf1-a82e-fc432a81ae4f","block_type":"box","text":"he price of the tiered index","page_number":405,"box":{"x":692,"y":475,"width":192,"height":12}},{"id":"0180e5a7-b150-4326-b29b-437181381f81","block_type":"box","text":"bond may be considerably more volatile than that of a fixed-rate bond.","page_number":405,"box":{"x":117,"y":490,"width":501,"height":12}},{"id":"119af18a-1a94-46b4-bdba-f46a93897845","block_type":"box","text":"TBA Commitments.","page_number":405,"box":{"x":118,"y":521,"width":142,"height":10}},{"id":"16004b36-eb0c-43fc-897c-04425d83db68","block_type":"box","text":"Certain Funds may enter into “to be announced” or “TBA” commitments. TBA","page_number":405,"box":{"x":262,"y":521,"width":583,"height":12}},{"id":"7e7276cb-7ded-4cdc-a092-4be159d4cce4","block_type":"box","text":"commitments are forward agreements for the purchase or sale of securities, including mortgage","page_number":405,"box":{"x":116,"y":537,"width":716,"height":12}},{"id":"0fd451f4-e343-4ca7-8369-0ee20f8561d4","block_type":"box","text":"backed securities for a fixed price, with payment and delivery on an agreed upon future settlement","page_number":405,"box":{"x":117,"y":552,"width":733,"height":12}},{"id":"03fe674a-5898-40df-829f-88804861cce5","block_type":"box","text":"date. The specific securities to be delivered are not identified at the trade date. However, delivered","page_number":405,"box":{"x":116,"y":568,"width":737,"height":12}},{"id":"cd5c89d4-e186-4faa-9d28-d14db591d108","block_type":"box","text":"securities must meet specified terms, including issuer, rate and mortgage terms. When the Fund enters","page_number":405,"box":{"x":116,"y":583,"width":772,"height":12}},{"id":"2686957c-6698-49a9-b6b7-2ba3ddf7f127","block_type":"box","text":"into a TBA commitment for the sale of mortgage-backed securities for a fixed price, with payment and","page_number":405,"box":{"x":117,"y":599,"width":758,"height":12}},{"id":"5268aa1b-410c-4942-b65f-e8105533bb92","block_type":"box","text":"delivery on an agreed upon future settlement date (which may be referred to as having a short position","page_number":405,"box":{"x":116,"y":614,"width":767,"height":12}},{"id":"52296404-d72b-4aa9-b6be-e5cd3d08fd78","block_type":"box","text":"in such TBA securities), the Fund may or may not hold the types of mortgage-backed securities","page_number":405,"box":{"x":117,"y":630,"width":712,"height":12}},{"id":"3435c57c-c4ea-4d1f-83f8-ed03e8ce62d5","block_type":"box","text":"required to be delivered. See “— When-Issued Securities, Delayed Delivery Securities and Forward","page_number":405,"box":{"x":117,"y":645,"width":743,"height":12}},{"id":"2cfe1f2c-2a54-4871-a10e-97e223aae055","block_type":"box","text":"Commitments” below.","page_number":405,"box":{"x":117,"y":661,"width":160,"height":9}},{"id":"592b331e-496d-41a5-8963-5c884f7fcfe4","block_type":"box","text":"Mortgage Dollar Rolls.","page_number":405,"box":{"x":116,"y":692,"width":164,"height":12}},{"id":"dd5f30d2-f9a6-4360-825b-7cb72d492fbf","block_type":"box","text":"Certain Funds may invest in mortgage dollar rolls. In a mortgage dollar roll","page_number":405,"box":{"x":288,"y":692,"width":550,"height":12}},{"id":"84812aef-984b-4d98-92fc-bef7a69b6c01","block_type":"box","text":"transaction, a Fund sells mortgage-backed securities for delivery in the current month and","page_number":405,"box":{"x":116,"y":707,"width":667,"height":12}},{"id":"bd1c47c5-4ea3-4295-ae3b-329560647dbb","block_type":"box","text":"simultaneously contracts to repurchase substantially similar securities on a specified future date. The","page_number":405,"box":{"x":116,"y":723,"width":750,"height":12}},{"id":"272765c5-d12a-46ac-b669-d41a85c16d72","block_type":"box","text":"securities that are repurchased will bear the same interest rate and a similar maturity as those sold, but","page_number":405,"box":{"x":116,"y":738,"width":766,"height":12}},{"id":"c9bc9d3e-ab38-4ca7-8345-1c3057ba7dc1","block_type":"box","text":"pools of mortgages collateralizing those securities may have different prepayment histories than those","page_number":405,"box":{"x":117,"y":754,"width":757,"height":12}},{"id":"418fd9f5-0536-49ac-97fa-473398d67085","block_type":"box","text":"sold. During the period between the sale and repurchase, a Fund will not be entitled to receive interest","page_number":405,"box":{"x":116,"y":769,"width":760,"height":12}},{"id":"1a6f1642-a825-4e3b-897d-12d6485129ce","block_type":"box","text":"and principal payments on the securities sold. Proceeds of the sale will be invested in additional","page_number":405,"box":{"x":116,"y":785,"width":710,"height":12}},{"id":"b509c0a7-afd0-4489-aaa7-c413586ac0fc","block_type":"box","text":"instruments for the Fund, and the income from these investments will generate income for the Fund. If","page_number":405,"box":{"x":117,"y":800,"width":757,"height":12}},{"id":"b223400f-d825-4454-91f6-233301686e23","block_type":"box","text":"such income does not exceed the income, capital appreciation and gain or loss that would have been","page_number":405,"box":{"x":116,"y":816,"width":751,"height":12}},{"id":"284fff3c-7e59-4f8c-a75c-32e901612e40","block_type":"box","text":"realized on the securities sold as part of the dollar roll, the use of this technique will diminish the","page_number":405,"box":{"x":117,"y":831,"width":715,"height":12}},{"id":"15f82113-11f0-4359-b62b-3c53385577f5","block_type":"box","text":"investment performance of a Fund compared with what the performance would have been without the","page_number":405,"box":{"x":117,"y":847,"width":759,"height":12}},{"id":"95fa6e2d-9765-46c4-a89c-c8ee7fbf10be","block_type":"box","text":"use of dollar rolls.","page_number":405,"box":{"x":117,"y":862,"width":135,"height":10}},{"id":"b55b556a-b873-46b8-a784-ff407bdc5d35","block_type":"box","text":"II-73","page_number":405,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"b3c8b3c0-1353-432d-a5e9-90327ff7d44c","block_type":"box","text":"NM1026U-6004382-405/605","page_number":405,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"7aae87bc-941f-4d39-8f07-6e7c61680e88","block_type":"box","text":"Each mortgage dollar roll transaction is accounted for as a sale or purchase of a portfolio security and","page_number":406,"box":{"x":117,"y":87,"width":760,"height":12}},{"id":"1bafbcd0-6edd-4d2f-89bb-745e42341a71","block_type":"box","text":"a subsequent purchase or sale of a substantially similar security in the forward market. Transactions in","page_number":406,"box":{"x":116,"y":102,"width":767,"height":13}},{"id":"0f442151-928b-4399-91a2-8f609e5fe427","block_type":"box","text":"mortgage dollar rolls may increase trading costs and portfolio turnover.","page_number":406,"box":{"x":117,"y":118,"width":529,"height":12}},{"id":"e328ad3e-7131-403e-9c71-24a279c90cdd","block_type":"box","text":"In the event the buyer of the securities under a mortgage dollar roll files for bankruptcy or becomes","page_number":406,"box":{"x":117,"y":150,"width":738,"height":12}},{"id":"abf31f98-d04f-48d8-91d3-fc86b4e41a38","block_type":"box","text":"insolvent, a Fund’s use of the proceeds of the current sale portion of the transaction may be restricted","page_number":406,"box":{"x":117,"y":166,"width":760,"height":12}},{"id":"4de1b0e5-4d08-4d15-92ba-136f6bd04a30","block_type":"box","text":"pending a determination by the other party, or its trustee or receiver, whether to enforce the Fund’s","page_number":406,"box":{"x":117,"y":181,"width":738,"height":12}},{"id":"e3dc4df6-4c1d-43ed-85cc-04f864e7267d","block_type":"box","text":"obligation to purchase the similar securities in the forward transaction.","page_number":406,"box":{"x":116,"y":197,"width":525,"height":12}},{"id":"e10f5d78-21f3-4d7d-ac34-8301a6f78ded","block_type":"box","text":"A Fund may engage in dollar roll transactions to enhance returns. Successful use of mortgage dollar","page_number":406,"box":{"x":116,"y":229,"width":750,"height":12}},{"id":"4c0d2e75-340d-47fb-9abf-e68fb26f6742","block_type":"box","text":"rolls may depend upon the Manager’s ability to correctly predict interest rates and prepayments. Dollar","page_number":406,"box":{"x":117,"y":245,"width":765,"height":12}},{"id":"98897585-7798-4bf5-80d5-c7a0475459a9","block_type":"box","text":"rolls involve the risk that the market value of the securities subject to a Fund’s forward purchase","page_number":406,"box":{"x":117,"y":260,"width":716,"height":12}},{"id":"0a637474-7ee2-4764-af85-9e403433843e","block_type":"box","text":"commitment may decline below, or the market value of the securities subject to a Fund’s forward sale","page_number":406,"box":{"x":116,"y":276,"width":758,"height":12}},{"id":"624191ac-ee90-4f1c-8e39-fd2e07246321","block_type":"box","text":"commitment may increase above, the exercise price of the forward commitment. Dollar rolls are","page_number":406,"box":{"x":116,"y":291,"width":715,"height":12}},{"id":"7c8a1b68-e388-4a85-a18a-1f2bf1b2fb3b","block_type":"box","text":"speculative techniques that can be deemed to involve leverage. There is no assurance that dollar rolls","page_number":406,"box":{"x":116,"y":307,"width":763,"height":12}},{"id":"78117e21-42c7-4fb3-9308-425d9c5898b6","block_type":"box","text":"can be successfully employed.","page_number":406,"box":{"x":116,"y":322,"width":233,"height":12}},{"id":"9cfab4a7-6b74-4cd3-a6b7-1b978c6dac31","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into when-issued or forward","page_number":406,"box":{"x":117,"y":355,"width":740,"height":12}},{"id":"7ea13055-0bf9-49bc-bf79-4ec2ea9245cc","block_type":"box","text":"settling securities (e.g., dollar rolls and firm and standby commitments, including TBA commitments)","page_number":406,"box":{"x":116,"y":370,"width":748,"height":12}},{"id":"53090525-3a30-4181-9f0e-3e99363d1819","block_type":"box","text":"and non-standard settlement cycle securities notwithstanding the limitation on the issuance of senior","page_number":406,"box":{"x":116,"y":386,"width":750,"height":12}},{"id":"1169e7fc-f65f-4a8d-8323-1728b25d2481","block_type":"box","text":"securities in Section 18 of the Investment Company Act, provided that the transaction meets the","page_number":406,"box":{"x":116,"y":401,"width":718,"height":12}},{"id":"00f3468c-9f7b-44fb-a894-968478ed9391","block_type":"box","text":"Delayed-Settlement Securities Provision (as defined below under “— When-Issued Securities, Delayed","page_number":406,"box":{"x":117,"y":417,"width":768,"height":12}},{"id":"e59e4d4e-2bb4-4fd9-bc5c-ee3600d895a6","block_type":"box","text":"Delivery Securities and Forward Commitments”). If a when-issued, forward-settling or non-standard","page_number":406,"box":{"x":117,"y":432,"width":742,"height":12}},{"id":"e543681f-3077-4423-9226-ce486517c770","block_type":"box","text":"settlement cycle security does not satisfy the Delayed-Settlement Securities Provision, then it is treated","page_number":406,"box":{"x":116,"y":448,"width":772,"height":12}},{"id":"1b5974be-6b46-4129-ab02-ce8d0b5c2697","block_type":"box","text":"as a Derivatives Transaction under Rule 18f-4. See “— Derivatives — Regulation of Derivatives —","page_number":406,"box":{"x":116,"y":463,"width":736,"height":12}},{"id":"47c9b68f-a09f-4eac-9231-0ad19ba2848f","block_type":"box","text":"Rule 18f-4 under the Investment Company Act” above.","page_number":406,"box":{"x":117,"y":479,"width":411,"height":12}},{"id":"385e34da-c2a2-4d61-bc49-91fff3494d7a","block_type":"box","text":"Net Interest Margin (NIM) Securities.","page_number":406,"box":{"x":117,"y":511,"width":270,"height":12}},{"id":"d68dbab1-a17b-47bf-9cbc-913c369b7e1b","block_type":"box","text":"A Fund may invest in net interest margin (“NIM”) securities.","page_number":406,"box":{"x":389,"y":511,"width":449,"height":12}},{"id":"c9850ea8-56aa-46a1-ab9c-1ceb807d08bc","block_type":"box","text":"These securities are derivative interest-only mortgage securities structured off home equity loan","page_number":406,"box":{"x":116,"y":527,"width":717,"height":12}},{"id":"46d5b394-36dd-447b-8d77-24a45e5382ab","block_type":"box","text":"transactions. NIM securities receive any “excess” interest computed after paying coupon costs,","page_number":406,"box":{"x":116,"y":542,"width":710,"height":12}},{"id":"46ddf2b4-3cf5-4aa3-879a-4eb88ac1104c","block_type":"box","text":"servicing costs and fees and any credit losses associated with the underlying pool of home equity","page_number":406,"box":{"x":116,"y":558,"width":728,"height":12}},{"id":"fed6f921-b128-4ce7-8e60-19ebb24e80bf","block_type":"box","text":"loans. Like traditional stripped mortgage-backed securities, the yield to maturity on a NIM security is","page_number":406,"box":{"x":117,"y":573,"width":745,"height":12}},{"id":"5b8a2613-40bf-4929-8700-01a07b6a5bac","block_type":"box","text":"sensitive not only to changes in prevailing interest rates but also to the rate of principal payments","page_number":406,"box":{"x":116,"y":589,"width":725,"height":12}},{"id":"51ed4d77-acdb-46e7-a448-689f00297594","block_type":"box","text":"(including prepayments) on the underlying home equity loans. NIM securities are highly sensitive to","page_number":406,"box":{"x":117,"y":604,"width":740,"height":12}},{"id":"8bd9036e-cae3-477b-b608-b7041ca1332b","block_type":"box","text":"credit losses on the underlying collateral and the timing in which those losses are taken.","page_number":406,"box":{"x":116,"y":620,"width":657,"height":12}},{"id":"7c922e44-3c95-4322-890b-3a66f5c23d2c","block_type":"box","text":"Municipal Investments.","page_number":406,"box":{"x":116,"y":652,"width":177,"height":12}},{"id":"b48c6718-36e5-4c2c-bf0f-934794d205b5","block_type":"box","text":"Certain Funds may invest in obligations issued by or on behalf of states, territories and possessions of","page_number":406,"box":{"x":117,"y":676,"width":759,"height":12}},{"id":"d2d65c0b-3558-47bb-9840-b2953685f92c","block_type":"box","text":"the United States and the District of Columbia and their political subdivisions, agencies and","page_number":406,"box":{"x":116,"y":691,"width":676,"height":12}},{"id":"7a980692-5f0d-4ac5-a978-522f568d37fd","block_type":"box","text":"instrumentalities, the payments from which, in the opinion of bond counsel to the issuer, are excludable","page_number":406,"box":{"x":117,"y":707,"width":765,"height":12}},{"id":"f3c03421-5c5c-4416-8145-f82e2449e4ce","block_type":"box","text":"from gross income for U.S. federal income tax purposes (“Municipal Bonds”). Certain of the Municipal","page_number":406,"box":{"x":116,"y":722,"width":752,"height":12}},{"id":"b16236ef-a990-408d-86c9-ae65ce8c9283","block_type":"box","text":"Funds may also invest in Municipal Bonds that pay interest excludable from gross income for purposes","page_number":406,"box":{"x":117,"y":738,"width":762,"height":12}},{"id":"ee988f8c-ebe1-45e7-9487-8367d7e46ae4","block_type":"box","text":"of state and local income taxes of the designated state and/or allow the value of a Fund’s shares to be","page_number":406,"box":{"x":116,"y":753,"width":759,"height":12}},{"id":"fbf31dba-386e-410f-b243-b8ca09a30cd3","block_type":"box","text":"exempt from state and local taxes of the designated state (“State Municipal Bonds”). The Municipal","page_number":406,"box":{"x":116,"y":769,"width":734,"height":12}},{"id":"d1d7f97c-ec07-426d-80a6-e7e955627f02","block_type":"box","text":"Funds may also invest in securities not issued by or on behalf of a state or territory or by an agency or","page_number":406,"box":{"x":117,"y":784,"width":757,"height":12}},{"id":"299e79be-2aa7-4e20-b6b2-99c6266cb16e","block_type":"box","text":"instrumentality thereof, if the Manager believes such securities to pay interest excludable from gross","page_number":406,"box":{"x":117,"y":800,"width":743,"height":12}},{"id":"515ac60c-5c72-4736-8d7d-b1f7bffd741c","block_type":"box","text":"income for purposes of U.S. federal income tax and state and local income taxes of the designated","page_number":406,"box":{"x":117,"y":815,"width":732,"height":12}},{"id":"370b44a9-0eb9-40bd-abb8-3f34486281f2","block_type":"box","text":"state and/or state and local personal property taxes of the designated state (“Non-Municipal","page_number":406,"box":{"x":116,"y":831,"width":686,"height":12}},{"id":"e7636f93-1275-4043-b568-b20e699f4429","block_type":"box","text":"Tax-Exempt Securities”). Non-Municipal Tax-Exempt Securities could include trust certificates or other","page_number":406,"box":{"x":116,"y":846,"width":764,"height":12}},{"id":"5fc04d77-84f5-4536-b11b-7e56f933f22b","block_type":"box","text":"instruments evidencing interest in one or more long-term municipal securities. Non-Municipal","page_number":406,"box":{"x":117,"y":862,"width":693,"height":12}},{"id":"fb0f9c2e-8b12-4032-845c-1d4a048f9294","block_type":"box","text":"Tax-Exempt Securities also may include securities issued by other investment companies that invest in","page_number":406,"box":{"x":116,"y":877,"width":770,"height":12}},{"id":"676b9f7e-65c4-4d0a-8f33-35935c9f4e77","block_type":"box","text":"II-74","page_number":406,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"f3785d31-d71c-446a-be82-cd600b41a712","block_type":"box","text":"NM1026U-6004382-406/605","page_number":406,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"d1bf511a-85d3-4cbb-8147-3c27a3dc790a","block_type":"box","text":"municipal bonds, to the extent such investments are permitted by applicable law. Non-Municipal","page_number":407,"box":{"x":117,"y":87,"width":715,"height":12}},{"id":"14f7810a-c863-4a18-a936-256d03372c46","block_type":"box","text":"Tax-Exempt Securities that pay interest excludable from gross income for U.S. federal income tax","page_number":407,"box":{"x":116,"y":102,"width":731,"height":13}},{"id":"0a84fd96-6415-4f2b-a5ae-66e275c04706","block_type":"box","text":"purposes will be considered “Municipal Bonds” for purposes of a Municipal Fund’s investment objective","page_number":407,"box":{"x":117,"y":118,"width":769,"height":12}},{"id":"a3d78c75-bb3d-4289-a9a0-ec9ed5ba342b","block_type":"box","text":"and policies. Non-Municipal Tax-Exempt Securities that pay interest excludable from gross income for","page_number":407,"box":{"x":116,"y":134,"width":761,"height":12}},{"id":"1a8bd82b-5f14-4263-824d-1c467aeed7bf","block_type":"box","text":"purposes of U.S. federal income tax and state and local income taxes of a designated state and/or","page_number":407,"box":{"x":117,"y":149,"width":734,"height":12}},{"id":"04b2b262-f732-4f45-879f-4ef13a2438bf","block_type":"box","text":"allow the value of a Fund’s shares to be exempt from state and local personal property taxes of that","page_number":407,"box":{"x":116,"y":165,"width":745,"height":12}},{"id":"8748a44f-4616-45ca-a569-dbe9b1c2f666","block_type":"box","text":"state will be considered “State Municipal Bonds” for purposes of the investment objective and policies","page_number":407,"box":{"x":116,"y":180,"width":758,"height":12}},{"id":"2578edac-27e6-4afa-8f5e-146519f04a58","block_type":"box","text":"of each of California Municipal Opportunities Fund, New Jersey Municipal Bond Fund, New York","page_number":407,"box":{"x":116,"y":196,"width":720,"height":12}},{"id":"8dd02a0c-c4b4-4804-8627-180d1919de50","block_type":"box","text":"Municipal Opportunities Fund and Pennsylvania Municipal Bond Fund.","page_number":407,"box":{"x":117,"y":211,"width":527,"height":12}},{"id":"30fd7e7a-63a9-40db-acf9-4cea935d900c","block_type":"box","text":"Risk Factors and Special Considerations Relating to Municipal Bonds.","page_number":407,"box":{"x":116,"y":244,"width":519,"height":12}},{"id":"a2f0e5a2-672e-4365-8bcf-601bfb4526ef","block_type":"box","text":"The risks and special","page_number":407,"box":{"x":636,"y":244,"width":168,"height":12}},{"id":"29474989-70e0-4def-8f67-6e4767dbe726","block_type":"box","text":"considerations involved in investment in Municipal Bonds vary with the types of instruments being","page_number":407,"box":{"x":116,"y":259,"width":729,"height":12}},{"id":"35043f09-9217-42dc-943b-30052f0178f9","block_type":"box","text":"acquired. Investments in Non-Municipal Tax-Exempt Securities may present similar risks, depending","page_number":407,"box":{"x":116,"y":275,"width":751,"height":12}},{"id":"0dec1029-d0db-42aa-987f-1e50013d1c93","block_type":"box","text":"on the particular product. Certain municipal instruments in which a Fund may invest may be","page_number":407,"box":{"x":116,"y":290,"width":685,"height":12}},{"id":"bcbaa7e9-934b-48f2-82cd-3928f198197c","block_type":"box","text":"characterized as derivatives.","page_number":407,"box":{"x":116,"y":306,"width":218,"height":9}},{"id":"52b09765-bf7b-4ee5-b785-7d3c4ab67ec4","block_type":"box","text":"The value of Municipal Bonds generally may be affected by uncertainties in the municipal markets as a","page_number":407,"box":{"x":116,"y":338,"width":768,"height":13}},{"id":"feadd412-c302-4925-8dcc-e70bf324ea4b","block_type":"box","text":"result of legislation or litigation, including legislation or litigation that changes the taxation of Municipal","page_number":407,"box":{"x":117,"y":354,"width":757,"height":12}},{"id":"9bf54b39-f8cf-4e3c-a7d3-f14e9e14bc68","block_type":"box","text":"Bonds or the rights of Municipal Bond holders in the event of a bankruptcy. Municipal bankruptcies are","page_number":407,"box":{"x":117,"y":369,"width":764,"height":13}},{"id":"21b761be-1d1b-43aa-9b75-89d659862c85","block_type":"box","text":"rare and certain provisions of the U.S. Bankruptcy Code governing such bankruptcies are unclear.","page_number":407,"box":{"x":117,"y":385,"width":732,"height":12}},{"id":"a0ac79df-9a61-4a91-b424-a305d71cf64e","block_type":"box","text":"Further, the application of state law to Municipal Bond issuers could produce varying results among the","page_number":407,"box":{"x":117,"y":400,"width":770,"height":13}},{"id":"831bc5f6-2bee-4b24-88e9-f2236be884f0","block_type":"box","text":"states or among Municipal Bond issuers within a state. These uncertainties could have a significant","page_number":407,"box":{"x":116,"y":416,"width":742,"height":12}},{"id":"abe5a741-cbbf-4383-b9e4-0b790bd3c649","block_type":"box","text":"impact on the prices of the Municipal Bonds in which a Fund invests.","page_number":407,"box":{"x":117,"y":431,"width":513,"height":12}},{"id":"75b85a2b-c550-4874-b683-a68752745a4e","block_type":"box","text":"Description of Municipal Bonds.","page_number":407,"box":{"x":116,"y":464,"width":240,"height":12}},{"id":"2edd873a-8ce5-47e9-86f6-2127669c19c5","block_type":"box","text":"Municipal Bonds include debt obligations issued to obtain funds for various public purposes, including","page_number":407,"box":{"x":117,"y":488,"width":757,"height":12}},{"id":"574fc428-bca7-45d4-b75e-5c65a4c50093","block_type":"box","text":"the construction of a wide range of public facilities, refunding of outstanding obligations and obtaining","page_number":407,"box":{"x":116,"y":504,"width":756,"height":12}},{"id":"586c7b04-5b4f-4dff-bf2a-8ae891b0710d","block_type":"box","text":"funds for general operating expenses and loans to other public institutions and facilities. In addition,","page_number":407,"box":{"x":116,"y":519,"width":744,"height":12}},{"id":"565e6a81-52ff-416e-ad49-917e47976928","block_type":"box","text":"certain types of bonds are issued by or on behalf of public authorities to finance various privately","page_number":407,"box":{"x":116,"y":535,"width":721,"height":12}},{"id":"b33fd330-78ff-47ce-9c8a-75d148346231","block_type":"box","text":"owned or operated facilities, including certain facilities for the local furnishing of electric energy or gas,","page_number":407,"box":{"x":116,"y":550,"width":763,"height":12}},{"id":"3653aa50-7c3e-45ef-aec5-6055e05d9c7a","block_type":"box","text":"sewage facilities, solid waste disposal facilities and other specialized facilities. Such obligations are","page_number":407,"box":{"x":116,"y":566,"width":740,"height":12}},{"id":"7fac5c4e-2954-4d02-bf54-36434cc77b18","block_type":"box","text":"included within the term Municipal Bonds if the interest paid thereon is excluded from gross income for","page_number":407,"box":{"x":117,"y":581,"width":764,"height":12}},{"id":"b1951c24-ca36-4aec-83b1-35697390c2e0","block_type":"box","text":"U.S. federal income tax purposes and any applicable state and local taxes. Other types of private","page_number":407,"box":{"x":117,"y":597,"width":726,"height":12}},{"id":"e8bf6563-2d2e-46ea-a9ac-17bad151c004","block_type":"box","text":"activity bonds, the proceeds of which are used for the construction, equipment or improvement of","page_number":407,"box":{"x":116,"y":612,"width":726,"height":12}},{"id":"b56a68fb-28b7-4677-a7e0-0279dc5b2c9d","block_type":"box","text":"privately operated industrial or commercial facilities, may constitute Municipal Bonds, although the","page_number":407,"box":{"x":117,"y":628,"width":732,"height":12}},{"id":"6035f4e8-a449-4ee5-830e-e269b14567f0","block_type":"box","text":"current U.S. federal tax laws place substantial limitations on the size of such issues. The interest on","page_number":407,"box":{"x":116,"y":643,"width":745,"height":12}},{"id":"20ba46ad-a843-4e16-9eab-6dd2ba9f11a6","block_type":"box","text":"Municipal Bonds may bear a fixed rate or be payable at a variable or floating rate. The two principal","page_number":407,"box":{"x":117,"y":659,"width":742,"height":12}},{"id":"9446221e-5a9e-4138-b493-2ae96fd15b03","block_type":"box","text":"classifications of Municipal Bonds are “general obligation” and “revenue” or “special obligation” bonds,","page_number":407,"box":{"x":116,"y":674,"width":756,"height":12}},{"id":"58625eff-a454-46d7-8f9e-79466c1aa4af","block_type":"box","text":"which latter category includes private activity bonds (“PABs”) (or “industrial development bonds” under","page_number":407,"box":{"x":116,"y":690,"width":760,"height":12}},{"id":"b07e8ffa-954a-48c0-855f-4f1f3c78756c","block_type":"box","text":"pre-1986 law).","page_number":407,"box":{"x":117,"y":705,"width":105,"height":12}},{"id":"8fc9760b-4b1f-4578-9101-b2b546caf900","block_type":"box","text":"General Obligation Bonds.","page_number":407,"box":{"x":117,"y":738,"width":194,"height":12}},{"id":"8be7f65a-d176-404f-82ff-d3f38d66bd52","block_type":"box","text":"General obligation bonds are secured by the issuer’s pledge of its full faith,","page_number":407,"box":{"x":319,"y":738,"width":553,"height":12}},{"id":"8277ba18-f6ea-4297-9513-44d8125f8582","block_type":"box","text":"credit and taxing power for the payment of principal and interest. The taxing power of any","page_number":407,"box":{"x":116,"y":753,"width":663,"height":13}},{"id":"76125043-0972-48f2-a7a8-d3ba62193b31","block_type":"box","text":"governmental entity may be limited, however, by provisions of its state constitution or laws, and an","page_number":407,"box":{"x":116,"y":769,"width":729,"height":12}},{"id":"8e94d882-0d5f-4ae7-a399-95c40ef25769","block_type":"box","text":"entity’s creditworthiness will depend on many factors, including potential erosion of its tax base due to","page_number":407,"box":{"x":116,"y":784,"width":755,"height":13}},{"id":"3f591929-c453-4821-b22e-d1af733ca1da","block_type":"box","text":"population declines, natural disasters, declines in the state’s industrial base or inability to attract new","page_number":407,"box":{"x":117,"y":800,"width":745,"height":12}},{"id":"8bd09192-80a5-4466-b60c-756a7742498d","block_type":"box","text":"industries, economic limits on the ability to tax without eroding the tax base, state legislative proposals","page_number":407,"box":{"x":117,"y":816,"width":757,"height":12}},{"id":"f130757e-678c-4bb7-8d9b-aa81222cb977","block_type":"box","text":"or voter initiatives to limit ad valorem real property taxes and the extent to which the entity relies on","page_number":407,"box":{"x":116,"y":831,"width":740,"height":12}},{"id":"0bbc82c2-ab6a-4993-a74d-224f6e65bb48","block_type":"box","text":"federal or state aid, access to capital markets or other factors beyond the state’s or entity’s control.","page_number":407,"box":{"x":116,"y":846,"width":738,"height":13}},{"id":"c1d1f6a0-262f-42c4-9b19-6ba28bdd7785","block_type":"box","text":"Accordingly, the capacity of the issuer of a general obligation bond as to the timely payment of interest","page_number":407,"box":{"x":116,"y":862,"width":765,"height":12}},{"id":"460d9306-2a4d-4da8-ae3f-539b9711d6ad","block_type":"box","text":"and the repayment of principal when due is affected by the issuer’s maintenance of its tax base.","page_number":407,"box":{"x":116,"y":877,"width":717,"height":13}},{"id":"9116381b-7f59-47e9-a492-53702e8ddf70","block_type":"box","text":"II-75","page_number":407,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"62c1606d-f09b-4f50-ada5-3b800d3c4a42","block_type":"box","text":"NM1026U-6004382-407/605","page_number":407,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"e30ada4b-3520-4c7f-8f62-459ef6e8329d","block_type":"box","text":"Revenue Bonds.","page_number":408,"box":{"x":116,"y":87,"width":122,"height":10}},{"id":"2b01eddf-861e-4315-9a23-8fedde20465b","block_type":"box","text":"Revenue bonds are payable only from the revenues derived from a particular facility","page_number":408,"box":{"x":240,"y":87,"width":634,"height":12}},{"id":"9bb89227-efa5-4cf5-9315-ce39bb960bbc","block_type":"box","text":"or class of facilities or, in some cases, from the proceeds of a special excise tax or other specific","page_number":408,"box":{"x":116,"y":102,"width":720,"height":12}},{"id":"ac90bbe2-c44e-4b7c-a569-07a4674866c7","block_type":"box","text":"revenue source such as payments from the user of the facility being financed; accordingly, the timely","page_number":408,"box":{"x":117,"y":118,"width":752,"height":12}},{"id":"aae4336e-e13e-4a8a-a8b5-49be7e785b78","block_type":"box","text":"payment of interest and the repayment of principal in accordance with the terms of the revenue or","page_number":408,"box":{"x":117,"y":134,"width":729,"height":12}},{"id":"382e5ae6-1db4-4a0a-a52a-6b36fb02a00c","block_type":"box","text":"special obligation bond is a function of the economic viability of such facility or such revenue source.","page_number":408,"box":{"x":116,"y":149,"width":749,"height":12}},{"id":"c4cacdcd-33a8-4135-9017-f87b138852a2","block_type":"box","text":"Revenue bonds issued by state or local agencies to finance the development of low-income, multi","page_number":408,"box":{"x":117,"y":180,"width":730,"height":12}},{"id":"e7c374bb-c052-40fd-8b34-17c729c5bc8a","block_type":"box","text":"family housing involve special risks in addition to those associated with municipal bonds generally,","page_number":408,"box":{"x":116,"y":196,"width":735,"height":12}},{"id":"0ecabc45-92d9-430b-b9d1-f550f0770630","block_type":"box","text":"including that the underlying properties may not generate sufficient income to pay expenses and","page_number":408,"box":{"x":117,"y":211,"width":718,"height":12}},{"id":"2256a5f7-b7c5-4109-95ae-cad30c493b69","block_type":"box","text":"interest costs. Such bonds are generally non-recourse against the property owner, may be junior to the","page_number":408,"box":{"x":117,"y":227,"width":768,"height":12}},{"id":"20ecd04e-7a5d-4928-9a6b-b89d9d27cf26","block_type":"box","text":"rights of others with an interest in the properties, may pay interest that changes based in part on the","page_number":408,"box":{"x":117,"y":242,"width":746,"height":12}},{"id":"bc3f0d58-836c-43b0-80d7-9ab1a7907279","block_type":"box","text":"financial performance of the property, may be prepayable without penalty and may be used to finance","page_number":408,"box":{"x":116,"y":258,"width":760,"height":12}},{"id":"d561351a-5221-4994-8674-9dbb7eda2808","block_type":"box","text":"the construction of housing developments which, until completed and rented, do not generate income","page_number":408,"box":{"x":116,"y":273,"width":757,"height":12}},{"id":"52e78804-9b0d-4143-9589-82202b84d548","block_type":"box","text":"to pay interest. Increases in interest rates payable on senior obligations may make it more difficult for","page_number":408,"box":{"x":116,"y":289,"width":755,"height":12}},{"id":"55d7f1eb-d2b4-43fa-9687-0b3e95af68a1","block_type":"box","text":"issuers to meet payment obligations on subordinated bonds.","page_number":408,"box":{"x":117,"y":304,"width":452,"height":12}},{"id":"631ed2ff-f3a7-46e9-8bbb-3fc9cc6559b9","block_type":"box","text":"PABs.","page_number":408,"box":{"x":116,"y":335,"width":45,"height":10}},{"id":"1ba419aa-0d99-4d47-ba5b-a9406ed7b43a","block_type":"box","text":"PABs are, in most cases, tax-exempt securities issued by states, municipalities or public","page_number":408,"box":{"x":162,"y":335,"width":666,"height":12}},{"id":"afe839e3-6472-4dc4-bca4-b683e8424dd4","block_type":"box","text":"authorities to provide funds, usually through a loan or lease arrangement, to a private entity for the","page_number":408,"box":{"x":116,"y":351,"width":735,"height":12}},{"id":"e71822fa-bbd9-4d2e-89e3-e12346b6fbaf","block_type":"box","text":"purpose of financing construction or improvement of a facility to be used by the entity. Such bonds are","page_number":408,"box":{"x":117,"y":366,"width":762,"height":12}},{"id":"5485a4e5-4c1d-4993-8327-0d73f528fa65","block_type":"box","text":"secured primarily by revenues derived from loan repayments or lease payments due from the entity,","page_number":408,"box":{"x":116,"y":382,"width":747,"height":12}},{"id":"1f90c96b-09b3-48e0-928b-9779e152cea9","block_type":"box","text":"which may or may not be guaranteed by a parent company or otherwise secured. PABs generally are","page_number":408,"box":{"x":116,"y":397,"width":758,"height":12}},{"id":"c2812827-8693-458d-b199-409bf210fd02","block_type":"box","text":"not secured by a pledge of the taxing power of the issuer of such bonds. Therefore, an investor should","page_number":408,"box":{"x":117,"y":413,"width":764,"height":12}},{"id":"90f0544a-4c1a-477c-bc80-1c440d056349","block_type":"box","text":"understand that repayment of such bonds generally depends on the revenues of a private entity and be","page_number":408,"box":{"x":117,"y":428,"width":771,"height":12}},{"id":"77892790-406c-4eda-8f55-da6b64f12f1e","block_type":"box","text":"aware of the risks that such an investment may entail. The continued ability of an entity to generate","page_number":408,"box":{"x":116,"y":444,"width":741,"height":12}},{"id":"fc085b5c-9bf1-4779-9bfd-460a0cf76ce9","block_type":"box","text":"sufficient revenues for the payment of principal and interest on such bonds will be affected by many","page_number":408,"box":{"x":116,"y":459,"width":744,"height":12}},{"id":"48d9b0ca-d7da-4722-936f-6571c018152a","block_type":"box","text":"factors including the size of the entity, its capital structure, demand for its products or services,","page_number":408,"box":{"x":116,"y":475,"width":707,"height":12}},{"id":"564c590c-16fa-4e9a-bacf-10340a81af3b","block_type":"box","text":"competition, general economic conditions, government regulation and the entity’s dependence on","page_number":408,"box":{"x":116,"y":490,"width":728,"height":12}},{"id":"6e263fc9-39b1-43dd-8bf1-5e8b49a92a8c","block_type":"box","text":"revenues for the operation of the particular facility being financed.","page_number":408,"box":{"x":117,"y":506,"width":491,"height":12}},{"id":"5feb124e-9e10-4791-b0fb-b3e5c162a88a","block_type":"box","text":"Moral Obligation Bonds.","page_number":408,"box":{"x":116,"y":537,"width":178,"height":12}},{"id":"e54d6ffb-7e51-4a3a-a7fe-fc2cea5a805c","block_type":"box","text":"“Moral obligation” bonds are normally issued by special purpose public","page_number":408,"box":{"x":295,"y":537,"width":534,"height":12}},{"id":"ad34b799-528c-4365-b17f-4af8a7056aa8","block_type":"box","text":"authorities. If an issuer of moral obligation bonds is unable to meet its obligations, the repayment of","page_number":408,"box":{"x":116,"y":552,"width":742,"height":12}},{"id":"b6fd935d-16e7-42c0-a7f2-6dcbc74434c9","block_type":"box","text":"such bonds becomes a moral commitment but not a legal obligation of the state or municipality that","page_number":408,"box":{"x":116,"y":568,"width":741,"height":12}},{"id":"9a974e94-5065-45af-9568-d7dfdd09e7ea","block_type":"box","text":"created the special purpose public authority that issued the bonds.","page_number":408,"box":{"x":116,"y":583,"width":498,"height":12}},{"id":"16ebffeb-dced-4318-aa34-2252a35a6009","block_type":"box","text":"Municipal Notes.","page_number":408,"box":{"x":116,"y":614,"width":122,"height":12}},{"id":"47997f8f-4980-48b3-baf9-a831ad092ad4","block_type":"box","text":"Municipal notes are shorter term municipal debt obligations. They may provide interim","page_number":408,"box":{"x":240,"y":614,"width":647,"height":12}},{"id":"9ced1cfe-45c5-4370-a322-ec177d51a628","block_type":"box","text":"financing in anticipation of tax collection, bond sales or revenue receipts. If there is a shortfall in the","page_number":408,"box":{"x":116,"y":630,"width":742,"height":12}},{"id":"d8d36717-cc17-407c-b89e-77f02d111db2","block_type":"box","text":"anticipated proceeds, repayment on the note may be delayed or the note may not be fully repaid, and a","page_number":408,"box":{"x":116,"y":645,"width":772,"height":12}},{"id":"ad003ecf-2056-4476-ae15-376ee13815a8","block_type":"box","text":"Fund may lose money.","page_number":408,"box":{"x":117,"y":661,"width":167,"height":12}},{"id":"a77a58be-9a5f-48f2-9afb-29ee6268f400","block_type":"box","text":"Municipal Commercial Paper.","page_number":408,"box":{"x":116,"y":692,"width":218,"height":12}},{"id":"c239d192-ad4a-4d88-84bb-70040f9dc635","block_type":"box","text":"Municipal commercial paper is generally unsecured and issued to meet","page_number":408,"box":{"x":341,"y":692,"width":528,"height":12}},{"id":"7be6adcb-2797-41d4-9075-addb7c0c9220","block_type":"box","text":"short-term financing needs. The lack of security presents some risk of loss to a Fund since, in the","page_number":408,"box":{"x":116,"y":707,"width":723,"height":12}},{"id":"7195a188-9071-4095-bb74-b2048c9020ee","block_type":"box","text":"event of an issuer’s bankruptcy, unsecured creditors are repaid only after the secured creditors out of","page_number":408,"box":{"x":116,"y":723,"width":753,"height":12}},{"id":"62e3cb09-20f8-4c4d-b529-5c24dfc25fb7","block_type":"box","text":"the assets, if any, that remain.","page_number":408,"box":{"x":116,"y":738,"width":223,"height":12}},{"id":"3584a051-0ce4-4684-901e-47ecdd456e37","block_type":"box","text":"Municipal Lease Obligations.","page_number":408,"box":{"x":116,"y":769,"width":213,"height":12}},{"id":"e74477fd-a68c-4a51-9eb4-10ef3cdd875a","block_type":"box","text":"Also included within the general category of Municipal Bonds are","page_number":408,"box":{"x":335,"y":769,"width":481,"height":12}},{"id":"2f2e708f-9503-4861-9ab4-61893663d83c","block_type":"box","text":"certificates of participation (“COPs”) issued by government authorities or entities to finance the","page_number":408,"box":{"x":116,"y":785,"width":701,"height":12}},{"id":"b2fda2a5-8544-4f6a-b6de-2b2c8119ce8c","block_type":"box","text":"acquisition or construction of equipment, land and/or facilities. The COPs represent participations in a","page_number":408,"box":{"x":116,"y":800,"width":753,"height":12}},{"id":"862560eb-6cb6-4c27-bf94-f3020b5ae5eb","block_type":"box","text":"lease, an installment purchase contract or a conditional sales contract (hereinafter collectively called","page_number":408,"box":{"x":117,"y":816,"width":742,"height":12}},{"id":"abc68278-360b-4357-82dd-f539a5a1af85","block_type":"box","text":"“lease obligations”) relating to such equipment, land or facilities. Municipal leases, like other municipal","page_number":408,"box":{"x":116,"y":831,"width":761,"height":12}},{"id":"3062ee8d-02cc-497c-94af-c0349ee87870","block_type":"box","text":"debt obligations, are subject to the risk of non-payment. Although lease obligations do not constitute","page_number":408,"box":{"x":116,"y":847,"width":747,"height":12}},{"id":"96b5e31e-b816-43c7-9441-badfc3e47e4d","block_type":"box","text":"general obligations of the issuer for which the issuer’s unlimited taxing power is pledged, a lease","page_number":408,"box":{"x":116,"y":862,"width":721,"height":12}},{"id":"6ae1eedf-be84-4af7-b41c-975dc3abbab7","block_type":"box","text":"obligation is frequently backed by the issuer’s covenant to budget for, appropriate and make the","page_number":408,"box":{"x":116,"y":878,"width":716,"height":12}},{"id":"c5beb555-3041-4c87-9aec-22f90594b4c9","block_type":"box","text":"II-76","page_number":408,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"631f0db8-5f77-4fe0-9a6a-db6b41c936d9","block_type":"box","text":"NM1026U-6004382-408/605","page_number":408,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"2dbd3dcd-3a23-4a40-a587-8cfcec97372d","block_type":"box","text":"payments due under the lease obligation. However, certain lease obligations contain","page_number":409,"box":{"x":117,"y":87,"width":631,"height":12}},{"id":"bbf0400e-56c3-4a7e-a360-05aeb7c381bc","block_type":"box","text":"“non-appropriation” clauses, which provide that the issuer has no obligation to make lease or","page_number":409,"box":{"x":116,"y":102,"width":693,"height":13}},{"id":"758d86e2-cc5e-4088-8794-a6d192a5a820","block_type":"box","text":"installment purchase payments in future years unless money is appropriated for such purpose on a","page_number":409,"box":{"x":117,"y":118,"width":739,"height":12}},{"id":"43a3be4b-f14f-46be-850d-f3adfdc64b00","block_type":"box","text":"yearly basis. Although “non-appropriation” lease obligations are secured by the leased property,","page_number":409,"box":{"x":116,"y":134,"width":716,"height":12}},{"id":"36d48d6e-3187-4b5e-b6aa-4a64f3a6e03b","block_type":"box","text":"disposition of the property in the event of foreclosure might prove difficult. These securities represent a","page_number":409,"box":{"x":116,"y":149,"width":767,"height":12}},{"id":"53aeaceb-86c8-4f65-956a-e8d545bbf7c8","block_type":"box","text":"type of financing that has not yet developed the depth of marketability associated with more","page_number":409,"box":{"x":116,"y":165,"width":685,"height":12}},{"id":"cb1cd3ee-78a6-4be2-8755-98fe8a7d1abb","block_type":"box","text":"conventional securities. Certain investments in lease obligations may be illiquid.","page_number":409,"box":{"x":116,"y":180,"width":596,"height":12}},{"id":"78046485-9d06-48dc-926d-47c5f8083b9e","block_type":"box","text":"The ability of issuers of municipal leases to make timely lease payments may be adversely impacted in","page_number":409,"box":{"x":116,"y":207,"width":769,"height":12}},{"id":"d911025b-3a4e-4d34-8923-9bde88fe8ae3","block_type":"box","text":"general economic downturns and as relative governmental cost burdens are allocated and reallocated","page_number":409,"box":{"x":116,"y":223,"width":762,"height":12}},{"id":"9efa9e5e-185f-4b28-9549-9bec340e8d15","block_type":"box","text":"among federal, state and local governmental units. Such non-payment would result in a reduction of","page_number":409,"box":{"x":116,"y":238,"width":746,"height":12}},{"id":"5aff3189-be00-4335-8f03-1c7f6a43f1fe","block_type":"box","text":"income to a Fund, and could result in a reduction in the value of the municipal lease experiencing","page_number":409,"box":{"x":117,"y":254,"width":726,"height":12}},{"id":"c336b9a9-e4c2-4b1b-860c-00e57aa0e973","block_type":"box","text":"non-payment and a potential decrease in the NAV of a Fund. Issuers of municipal securities might","page_number":409,"box":{"x":117,"y":269,"width":731,"height":12}},{"id":"ff760814-e29c-4b10-aa30-85238d8774d6","block_type":"box","text":"seek protection under the bankruptcy laws. In the event of bankruptcy of such an issuer, a Fund could","page_number":409,"box":{"x":116,"y":285,"width":762,"height":12}},{"id":"c8a3f5e4-271b-4815-a100-4778d6d07cc4","block_type":"box","text":"experience delays and limitations with respect to the collection of principal and interest on such","page_number":409,"box":{"x":116,"y":300,"width":711,"height":12}},{"id":"5114c691-42c5-4b97-959a-01293b275ecc","block_type":"box","text":"municipal leases and a Fund may not, in all circumstances, be able to collect all principal and interest","page_number":409,"box":{"x":117,"y":316,"width":755,"height":12}},{"id":"cdf139eb-4aa2-4eb4-a20b-96b5d604eb25","block_type":"box","text":"to which it is entitled. To enforce its rights in the event of a default in lease payments, a Fund might","page_number":409,"box":{"x":116,"y":331,"width":740,"height":12}},{"id":"d93b3480-a32b-4a25-97dd-10b16cf9f452","block_type":"box","text":"take possession of and manage the assets securing the issuer’s obligations on such securities, which","page_number":409,"box":{"x":116,"y":347,"width":758,"height":12}},{"id":"6806825e-58df-49e1-a75c-e55946389cb6","block_type":"box","text":"may increase a Fund’s operating expenses and adversely affect the NAV of a Fund. When the lease","page_number":409,"box":{"x":117,"y":362,"width":749,"height":12}},{"id":"59fa79bd-f33f-4b9d-8124-ec51041a210a","block_type":"box","text":"contains a non-appropriation clause, however, the failure to pay would not be a default and a Fund","page_number":409,"box":{"x":116,"y":378,"width":737,"height":12}},{"id":"ea86d43a-b921-4a55-8045-9b9d2fd79bee","block_type":"box","text":"would not have the right to take possession of the assets. Any income derived from a Fund’s","page_number":409,"box":{"x":116,"y":393,"width":692,"height":12}},{"id":"69eed9eb-421f-42b2-9025-682cc26be62c","block_type":"box","text":"ownership or operation of such assets may not be tax-exempt. In addition, a Fund’s intention to qualify","page_number":409,"box":{"x":116,"y":409,"width":765,"height":12}},{"id":"a0f9fb57-ee45-4bbd-a9e5-fd6c729b057e","block_type":"box","text":"as a “regulated investment company” under the Code, may limit the extent to which a Fund may","page_number":409,"box":{"x":116,"y":424,"width":717,"height":12}},{"id":"6bacf579-a569-4337-b08a-d794c621f07a","block_type":"box","text":"exercise its rights by taking possession of such assets, because as a regulated investment company a","page_number":409,"box":{"x":116,"y":440,"width":765,"height":12}},{"id":"e6f9f76b-0b72-4663-8d44-b347ef0daeb9","block_type":"box","text":"Fund is subject to certain limitations on its investments and on the nature of its income.","page_number":409,"box":{"x":117,"y":455,"width":650,"height":12}},{"id":"6f7d55f0-3776-43bf-8294-e138b5db2dff","block_type":"box","text":"Tender Option Bonds.","page_number":409,"box":{"x":118,"y":482,"width":161,"height":12}},{"id":"294f4668-19a8-4d1d-8b7f-cb51ab042663","block_type":"box","text":"Certain Funds may invest in residual inverse floating rate interest tender option","page_number":409,"box":{"x":280,"y":482,"width":596,"height":12}},{"id":"55102af1-8bbe-4061-b3a5-cdc65cd5e419","block_type":"box","text":"bonds (“TOB Residuals”), which are derivative interests in Municipal Bonds. The TOB Residuals in","page_number":409,"box":{"x":117,"y":498,"width":736,"height":12}},{"id":"e83132ac-8ea3-4f58-b314-66c34733c6a1","block_type":"box","text":"which the Funds will invest pay interest or income that, in the opinion of counsel to the issuer, is","page_number":409,"box":{"x":116,"y":513,"width":715,"height":12}},{"id":"9e69116d-7ce0-4636-a190-d472026f5d7a","block_type":"box","text":"exempt from regular U.S. federal income tax. BlackRock will not conduct its own analysis of the tax","page_number":409,"box":{"x":116,"y":529,"width":740,"height":12}},{"id":"24a1f56f-6ae5-49f5-8dda-8fddf5226897","block_type":"box","text":"status of the interest or income paid by TOB Residuals held by the Funds, but will rely on the opinion of","page_number":409,"box":{"x":116,"y":544,"width":772,"height":12}},{"id":"77e7a8d6-b500-451e-9150-ab55f3d1b197","block_type":"box","text":"counsel to the issuer. Although volatile, TOB Residuals typically offer the potential for yields exceeding","page_number":409,"box":{"x":116,"y":560,"width":767,"height":12}},{"id":"b94f431f-490d-4202-9d03-59182389bed3","block_type":"box","text":"the yields available on fixed rate Municipal Bonds with comparable credit quality. The Funds may","page_number":409,"box":{"x":116,"y":575,"width":724,"height":12}},{"id":"57a6517b-50dc-4af6-9a41-a9baa20cc047","block_type":"box","text":"invest in TOB Residuals for the purpose of using economic leverage.","page_number":409,"box":{"x":117,"y":591,"width":515,"height":12}},{"id":"20a8847a-58d2-4fef-a35f-af5722a7062c","block_type":"box","text":"TOB Residuals represent beneficial interests in a special purpose trust formed for the purpose of","page_number":409,"box":{"x":116,"y":618,"width":723,"height":12}},{"id":"ba8d799b-23ea-4418-ae04-ea92f827818a","block_type":"box","text":"holding Municipal Bonds contributed by one or more funds (a “TOB Trust”). A TOB Trust typically","page_number":409,"box":{"x":117,"y":634,"width":724,"height":12}},{"id":"5b39c4e6-5d80-4fde-a309-c5311257d88d","block_type":"box","text":"issues two classes of beneficial interests: short-term floating rate interests (“TOB Floaters”), which are","page_number":409,"box":{"x":117,"y":649,"width":762,"height":12}},{"id":"8c66e6a6-8b4b-482c-afd8-69cc08e79a4e","block_type":"box","text":"sold to third-party investors, and TOB Residuals, which are generally issued to the fund(s) that","page_number":409,"box":{"x":116,"y":665,"width":701,"height":12}},{"id":"cf81aee5-e73a-433f-8a91-1dbd815a3e61","block_type":"box","text":"transferred Municipal Bonds to the TOB Trust. The Funds may invest in both TOB Floaters and TOB","page_number":409,"box":{"x":116,"y":680,"width":745,"height":12}},{"id":"1f77c98e-9998-419f-b548-21d6a0588c44","block_type":"box","text":"Residuals. TOB Floaters may have first priority on the cash flow from the Municipal Bonds held by the","page_number":409,"box":{"x":117,"y":696,"width":754,"height":12}},{"id":"1ff9ed87-0d9a-4b80-adc6-919f2c84e6e3","block_type":"box","text":"TOB Trust and are enhanced with a liquidity support arrangement from a third-party Liquidity Provider","page_number":409,"box":{"x":116,"y":711,"width":755,"height":12}},{"id":"a919e303-4ebc-434b-bbd9-300c055ccbe5","block_type":"box","text":"(defined below) which allows holders to tender their position at par (plus accrued interest). A Fund, as","page_number":409,"box":{"x":117,"y":727,"width":753,"height":12}},{"id":"3691b802-6488-47a4-adf8-1215a4d3691e","block_type":"box","text":"a holder of TOB Residuals, is paid the residual cash flow from the TOB Trust. A Fund that contributes","page_number":409,"box":{"x":116,"y":742,"width":753,"height":12}},{"id":"ff9bfe74-c6aa-4fb5-be23-93add3cb9cb6","block_type":"box","text":"the Municipal Bonds to the TOB Trust is paid the cash received by the TOB Trust from the sale of the","page_number":409,"box":{"x":116,"y":758,"width":752,"height":12}},{"id":"5bcc7dba-5ca9-44f8-837c-fe170d8b3b92","block_type":"box","text":"TOB Floaters, less certain transaction costs, and typically will invest the cash to purchase additional","page_number":409,"box":{"x":116,"y":773,"width":741,"height":12}},{"id":"11991bef-b920-4a1f-84c0-3468d93ff3e4","block_type":"box","text":"Municipal Bonds or other investments permitted by its investment policies. If a Fund ever purchases all","page_number":409,"box":{"x":117,"y":789,"width":761,"height":12}},{"id":"7a7c628a-78d3-4d11-b9a5-8cdba974682c","block_type":"box","text":"or a portion of the TOB Floaters sold by the TOB Trust, it may surrender those TOB Floaters together","page_number":409,"box":{"x":116,"y":804,"width":754,"height":12}},{"id":"971e0c8e-518f-4251-bd06-444073c378c3","block_type":"box","text":"with a proportionate amount of TOB Residuals to the TOB Trust in exchange for a proportionate","page_number":409,"box":{"x":116,"y":820,"width":711,"height":12}},{"id":"61d3d697-e5e6-4e2c-afd2-830b544b7442","block_type":"box","text":"amount of the Municipal Bonds owned by the TOB Trust.","page_number":409,"box":{"x":116,"y":835,"width":427,"height":12}},{"id":"ce80a20f-35b9-4024-a68b-03be98f044e8","block_type":"box","text":"Other BlackRock-advised funds may contribute Municipal Bonds to a TOB Trust into which a Fund has","page_number":409,"box":{"x":116,"y":862,"width":767,"height":12}},{"id":"ffe482e8-be41-4812-8aa9-d1436e4a6822","block_type":"box","text":"contributed Municipal Bonds. If multiple BlackRock-advised funds participate in the same TOB Trust,","page_number":409,"box":{"x":116,"y":878,"width":752,"height":12}},{"id":"59073db3-ab72-4939-8cb5-a131b523f15f","block_type":"box","text":"II-77","page_number":409,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"f4079a3d-2215-419f-aa7a-33fe010c2d4d","block_type":"box","text":"NM1026U-6004382-409/605","page_number":409,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c5116916-dc0b-4bd0-93f8-22e533f28a5c","block_type":"box","text":"the economic rights and obligations under the TOB Residual will generally be shared among the funds","page_number":410,"box":{"x":116,"y":87,"width":764,"height":12}},{"id":"430d6af0-f0ac-4efd-9b64-76958070bfb0","block_type":"box","text":"ratably in proportion to their participation in the TOB Trust.","page_number":410,"box":{"x":117,"y":102,"width":437,"height":13}},{"id":"7a68ed79-da6f-4383-bfe0-7eea1c7c318e","block_type":"box","text":"The Municipal Bonds transferred to a TOB Trust typically are high grade Municipal Bonds. In certain","page_number":410,"box":{"x":116,"y":134,"width":747,"height":12}},{"id":"30b98e56-7265-4b5c-bb53-e42dd4992b92","block_type":"box","text":"cases, when Municipal Bonds transferred are lower grade Municipal Bonds, the TOB Trust transaction","page_number":410,"box":{"x":116,"y":149,"width":764,"height":12}},{"id":"a5775617-9914-4de5-81e1-e7ec7789e4cf","block_type":"box","text":"includes a credit enhancement feature that provides for the timely payment of principal and interest on","page_number":410,"box":{"x":117,"y":165,"width":762,"height":12}},{"id":"b46ff6a0-469e-4f46-88c9-7de631cedbe0","block_type":"box","text":"the bonds to the TOB Trust by a credit enhancement provider. The TOB Trust would be responsible for","page_number":410,"box":{"x":116,"y":180,"width":770,"height":12}},{"id":"31148a3e-f0b5-4dd8-b742-c0cb0fd83f2e","block_type":"box","text":"the payment of the credit enhancement fee and a Fund, as a TOB Residual holder, would be","page_number":410,"box":{"x":116,"y":196,"width":693,"height":12}},{"id":"3ac97d0f-c02f-4ecd-bc15-8c922c174632","block_type":"box","text":"responsible for reimbursement of any payments of principal and interest made by the credit","page_number":410,"box":{"x":117,"y":211,"width":681,"height":12}},{"id":"79cda145-81f1-4406-9459-6474a9a832d6","block_type":"box","text":"enhancement provider.","page_number":410,"box":{"x":116,"y":227,"width":176,"height":11}},{"id":"8f223026-699b-45af-a286-898c5447ca28","block_type":"box","text":"The TOB Residuals held by a Fund generally provide the Fund with the right to cause the holders of a","page_number":410,"box":{"x":116,"y":258,"width":760,"height":12}},{"id":"745eabcc-b138-48c6-9631-009ebac1b206","block_type":"box","text":"proportional share of the TOB Floaters to tender their notes to the TOB Trust at par plus accrued","page_number":410,"box":{"x":117,"y":273,"width":722,"height":12}},{"id":"01975088-4899-4c09-a2ec-2187bde873b2","block_type":"box","text":"interest. Thereafter, the Fund may withdraw a corresponding share of the Municipal Bonds from the","page_number":410,"box":{"x":117,"y":289,"width":743,"height":12}},{"id":"4ead54fc-6cd7-46e3-83a1-b68ad0b474dd","block_type":"box","text":"TOB Trust. This transaction, in effect, creates exposure for the Fund to the entire return of the","page_number":410,"box":{"x":116,"y":304,"width":702,"height":12}},{"id":"e6cd368a-a6c9-432d-bd2a-54955003a319","block_type":"box","text":"Municipal Bonds in the TOB Trust, with a net cash investment by the Fund that is less than the value of","page_number":410,"box":{"x":117,"y":320,"width":770,"height":12}},{"id":"a70cb3cd-dab1-43b1-bedf-c0a93f7100a8","block_type":"box","text":"the Municipal Bonds in the TOB Trust. This multiplies the positive or negative impact of the Municipal","page_number":410,"box":{"x":116,"y":335,"width":755,"height":12}},{"id":"614310e5-51c3-45b5-8d46-a2dcc12ed2b0","block_type":"box","text":"Bonds’ return within the Fund (thereby creating leverage). The leverage within a TOB Trust depends","page_number":410,"box":{"x":117,"y":351,"width":749,"height":12}},{"id":"981a2f30-c19a-46f1-ad58-5fe96a8e8f46","block_type":"box","text":"on the value of the Municipal Bonds deposited in the TOB Trust relative to the value of the TOB","page_number":410,"box":{"x":116,"y":366,"width":714,"height":12}},{"id":"df21449b-aa49-448b-b6d8-af5118bbe1fd","block_type":"box","text":"Floaters it issues.","page_number":410,"box":{"x":117,"y":382,"width":134,"height":9}},{"id":"d19dc10f-a8c4-4659-adc9-437680071f03","block_type":"box","text":"A Fund may invest in highly leveraged TOB Residuals. A TOB Residual generally is considered highly","page_number":410,"box":{"x":116,"y":413,"width":762,"height":12}},{"id":"ad289faa-7537-4680-915a-05fec733c472","block_type":"box","text":"leveraged if the principal amount of the TOB Floaters issued by the related TOB Trust exceeds 75% of","page_number":410,"box":{"x":117,"y":428,"width":765,"height":12}},{"id":"dfd38223-f27d-46b6-96ca-50c76e757062","block_type":"box","text":"the principal amount of the Municipal Bonds owned by the TOB Trust.","page_number":410,"box":{"x":116,"y":444,"width":523,"height":12}},{"id":"352062e4-7171-45ab-9d0b-53d8c90ae190","block_type":"box","text":"The TOB Trust may be collapsed without the consent of a Fund upon the occurrence of tender option","page_number":410,"box":{"x":116,"y":475,"width":757,"height":12}},{"id":"4f58064d-0f83-4501-8702-ce1403e68a16","block_type":"box","text":"termination events (“TOTEs”) and mandatory termination events (“MTEs”), as defined in the TOB Trust","page_number":410,"box":{"x":116,"y":490,"width":768,"height":12}},{"id":"93f907dd-d277-46a9-bdb1-5dee44fbde0f","block_type":"box","text":"agreements. TOTEs include the bankruptcy or default of the issuer of the Municipal Bonds held in the","page_number":410,"box":{"x":116,"y":506,"width":758,"height":12}},{"id":"8d36b3f3-243d-401e-884d-10d15c92fa62","block_type":"box","text":"TOB Trust, a substantial downgrade in the credit quality of the issuer of the Municipal Bonds held in","page_number":410,"box":{"x":116,"y":521,"width":744,"height":12}},{"id":"f95546e8-90a5-4003-8474-621fcca55fd5","block_type":"box","text":"the TOB Trust, failure of any scheduled payment of principal or interest on the Municipal Bonds, and a","page_number":410,"box":{"x":116,"y":537,"width":763,"height":12}},{"id":"d474f13e-a34a-4714-8124-073a07dcf56c","block_type":"box","text":"judgment or ruling that interest on the Municipal Bonds is subject to U.S. federal income taxation.","page_number":410,"box":{"x":115,"y":552,"width":727,"height":12}},{"id":"20ad41e4-af04-49fc-a73a-d31e596fd59b","block_type":"box","text":"MTEs may include, among other things, a failed remarketing of the TOB Floaters, the inability of the","page_number":410,"box":{"x":117,"y":568,"width":745,"height":12}},{"id":"40a8babf-83b9-4aa1-8916-2d7757cfd37d","block_type":"box","text":"TOB Trust to obtain renewal of the liquidity support agreement, and a substantial decline in the market","page_number":410,"box":{"x":116,"y":583,"width":765,"height":12}},{"id":"23cb220a-b942-4948-b7f2-4add2a52c22c","block_type":"box","text":"value of the Municipal Bonds held in the TOB Trust. Upon the occurrence of a TOTE or an MTE, a","page_number":410,"box":{"x":116,"y":599,"width":734,"height":12}},{"id":"0d6da8af-5312-4a62-8dac-e0ab0f204370","block_type":"box","text":"TOB Trust would be liquidated with the proceeds applied first to any accrued fees owed to the trustee","page_number":410,"box":{"x":116,"y":614,"width":758,"height":12}},{"id":"44d23f5f-18c2-4266-bb6d-f070b8c79a21","block_type":"box","text":"of the TOB Trust, the remarketing agent of the TOB Floaters and the Liquidity Provider (defined","page_number":410,"box":{"x":116,"y":630,"width":714,"height":12}},{"id":"a9a001f8-a776-49f1-91d1-557387371576","block_type":"box","text":"below). In the case of an MTE, after the payment of fees, the holders of the TOB Floaters would be","page_number":410,"box":{"x":117,"y":645,"width":739,"height":12}},{"id":"ace58c7a-ee75-4043-ab47-16cbd75d2720","block_type":"box","text":"paid senior to the TOB Residual holders (","page_number":410,"box":{"x":117,"y":661,"width":307,"height":12}},{"id":"bb44f783-ab46-4798-ab5b-d88fd0ee8ffe","block_type":"box","text":"i.e.","page_number":410,"box":{"x":425,"y":661,"width":20,"height":9}},{"id":"a2f3e26b-8f26-4901-8d65-9e45b7374e85","block_type":"box","text":", the Fund). In contrast, in the case of a TOTE, after","page_number":410,"box":{"x":448,"y":661,"width":385,"height":12}},{"id":"db60b964-c0d3-4fa8-add1-9af4d1cef27c","block_type":"box","text":"payment of fees, the holders of TOB Floaters and the TOB Residual holders would be paid pro rata in","page_number":410,"box":{"x":117,"y":676,"width":753,"height":12}},{"id":"bdfdd39e-eb99-4226-9566-45cd58bda5d7","block_type":"box","text":"proportion to the respective face values of their certificates.","page_number":410,"box":{"x":117,"y":692,"width":437,"height":12}},{"id":"2ab55094-5dde-4d70-bbee-dbb4e657ff31","block_type":"box","text":"A Fund may invest in a TOB Trust on either a non-recourse or recourse basis. TOB Trusts are typically","page_number":410,"box":{"x":116,"y":723,"width":764,"height":12}},{"id":"8a4d1d5d-4b90-4cbe-b861-05ccce63212c","block_type":"box","text":"supported by a liquidity facility provided by a third-party bank or other financial institution (the “Liquidity","page_number":410,"box":{"x":116,"y":738,"width":761,"height":12}},{"id":"41032462-258c-44c0-bb20-b76deda5fe84","block_type":"box","text":"Provider”) that allows the holders of the TOB Floaters to tender their TOB Floaters in exchange for","page_number":410,"box":{"x":117,"y":754,"width":730,"height":12}},{"id":"46ac3b18-4f14-48eb-bb47-59f616ceda15","block_type":"box","text":"payment of par plus accrued interest on any business day (subject to the non-occurrence of a TOTE","page_number":410,"box":{"x":117,"y":769,"width":743,"height":12}},{"id":"0cb789cb-0cca-403f-94c9-884cf790cccf","block_type":"box","text":"described above). Depending on the structure of the TOB Trust, the Liquidity Provider may purchase","page_number":410,"box":{"x":116,"y":785,"width":747,"height":12}},{"id":"e594672a-1ca8-468c-bfa8-2e04e2c9d162","block_type":"box","text":"the tendered TOB Floaters, or the TOB Trust may draw upon a loan from the Liquidity Provider to","page_number":410,"box":{"x":116,"y":800,"width":723,"height":12}},{"id":"401b50ff-eabc-4d24-bd16-ef2017ad0b3f","block_type":"box","text":"purchase the tendered TOB Floaters.","page_number":410,"box":{"x":117,"y":816,"width":275,"height":12}},{"id":"d5d71873-9e86-4096-b921-904a8eee08bf","block_type":"box","text":"When a Fund invests in TOB Trusts on a non-recourse basis, and the Liquidity Provider is required to","page_number":410,"box":{"x":116,"y":847,"width":758,"height":12}},{"id":"4a8039e6-38c1-4487-bdc0-6b2426595420","block_type":"box","text":"make a payment under the liquidity facility, the Liquidity Provider will typically liquidate all or a portion","page_number":410,"box":{"x":117,"y":862,"width":753,"height":12}},{"id":"e3ee5c75-0f15-4e7e-8cd3-72eb41fe923e","block_type":"box","text":"of the Municipal Bonds held in the TOB Trust and then fund the balance, if any, of the amount owed","page_number":410,"box":{"x":116,"y":878,"width":746,"height":12}},{"id":"d40fa7cd-f020-409c-8417-12de7a0dba6b","block_type":"box","text":"II-78","page_number":410,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"6e78586f-5cd0-4c42-b2de-17442667a422","block_type":"box","text":"NM1026U-6004382-410/605","page_number":410,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4efc997a-4cc9-4bbc-937a-7a8f41e890d2","block_type":"box","text":"under the liquidity facility over the liquidation proceeds (the “Liquidation Shortfall”). If a Fund invests in","page_number":411,"box":{"x":117,"y":87,"width":760,"height":12}},{"id":"4951c21a-75f0-4f81-89d0-ea80958d9cef","block_type":"box","text":"a TOB Trust on a recourse basis, it will typically enter into a reimbursement agreement with the","page_number":411,"box":{"x":116,"y":102,"width":712,"height":13}},{"id":"a8c53bf2-e839-4939-97f6-8d81b8b5ac43","block_type":"box","text":"Liquidity Provider pursuant to which the Fund is required to reimburse the Liquidity Provider the","page_number":411,"box":{"x":117,"y":118,"width":712,"height":12}},{"id":"2484c29c-bdf1-4f62-aa15-c5f2281c26e0","block_type":"box","text":"amount of any Liquidation Shortfall. As a result, if the Fund invests in a recourse TOB Trust, the Fund","page_number":411,"box":{"x":116,"y":134,"width":759,"height":12}},{"id":"87e4eeea-4109-4f04-94a3-4be33172ef48","block_type":"box","text":"will bear the risk of loss with respect to any Liquidation Shortfall. If multiple BlackRock-advised funds","page_number":411,"box":{"x":116,"y":149,"width":751,"height":12}},{"id":"93500bde-b879-4c9c-b964-1bb3c9a069fa","block_type":"box","text":"participate in any such TOB Trust, these losses will be shared ratably, in proportion to their","page_number":411,"box":{"x":117,"y":165,"width":678,"height":12}},{"id":"72c6bef9-94f0-4f6d-9ec4-68ca034d3d61","block_type":"box","text":"participation in the TOB Trust.","page_number":411,"box":{"x":117,"y":180,"width":227,"height":12}},{"id":"7ee6b808-db95-4377-82e4-8d83ffbe98c2","block_type":"box","text":"Under accounting rules, Municipal Bonds of a Fund that are deposited into a TOB Trust are","page_number":411,"box":{"x":117,"y":211,"width":682,"height":12}},{"id":"019ee72f-5de2-4042-811e-202c349580b0","block_type":"box","text":"investments of the Fund and are presented on the Fund’s Schedule of Investments and outstanding","page_number":411,"box":{"x":117,"y":227,"width":745,"height":12}},{"id":"06412426-2ad0-488d-a0c8-4d1518764da7","block_type":"box","text":"TOB Floaters issued by a TOB Trust are presented as liabilities in the Fund’s Statement of Assets and","page_number":411,"box":{"x":116,"y":242,"width":765,"height":12}},{"id":"f00e0629-ea71-4057-b5ed-99aee8c22f53","block_type":"box","text":"Liabilities. Interest income from the underlying Municipal Bonds is recorded by a Fund on an accrual","page_number":411,"box":{"x":117,"y":258,"width":747,"height":12}},{"id":"480d253a-fab3-4d27-967e-131184b5cf99","block_type":"box","text":"basis. Interest expense incurred on the","page_number":411,"box":{"x":117,"y":273,"width":288,"height":12}},{"id":"a52562d0-599e-4708-8513-371dc9591d39","block_type":"box","text":"TOB Floaters and other expenses related to remarketing,","page_number":411,"box":{"x":409,"y":273,"width":430,"height":12}},{"id":"b0dd7546-e20d-4469-810c-71293a11e968","block_type":"box","text":"administration, trustee and other services to a TOB Trust are reported as expenses of a Fund. In","page_number":411,"box":{"x":116,"y":289,"width":722,"height":12}},{"id":"5d89b5c2-db86-432e-8fe9-b63ba8658102","block_type":"box","text":"addition, under accounting rules, loans made to a TOB Trust sponsored by a Fund may be presented","page_number":411,"box":{"x":116,"y":304,"width":757,"height":12}},{"id":"677c14f1-4c78-432b-87e4-91a59da9202c","block_type":"box","text":"as loans of the Fund in the Fund’s financial statements even if there is no recourse to the Fund’s","page_number":411,"box":{"x":116,"y":320,"width":721,"height":9}},{"id":"0e2904b8-7987-4ac4-bed7-0af743f76370","block_type":"box","text":"assets.","page_number":411,"box":{"x":116,"y":335,"width":58,"height":10}},{"id":"56d30344-fb92-4cd3-9672-f9e4d2c6fafb","block_type":"box","text":"For TOB Floaters, generally, the interest rate earned will be based upon the market rates for Municipal","page_number":411,"box":{"x":117,"y":366,"width":765,"height":12}},{"id":"c307c564-e880-4cdb-966f-cf7730f21ee2","block_type":"box","text":"Bonds with maturities or remarketing provisions that are comparable in duration to the periodic interval","page_number":411,"box":{"x":117,"y":382,"width":764,"height":12}},{"id":"38a53608-3547-4aa4-a868-2a115969ccf4","block_type":"box","text":"of the tender option. Since the tender option feature has a shorter term than the final maturity or first","page_number":411,"box":{"x":116,"y":397,"width":748,"height":12}},{"id":"63989a24-1598-42c6-8de2-76cf7021ab75","block_type":"box","text":"call date of the underlying Municipal Bonds deposited in the TOB Trust, the holder of the TOB Floaters","page_number":411,"box":{"x":116,"y":413,"width":766,"height":12}},{"id":"4d26aa25-c045-4cb7-b463-ecc5027035ab","block_type":"box","text":"relies upon the terms of the agreement with the financial institution furnishing the liquidity facility as","page_number":411,"box":{"x":117,"y":428,"width":738,"height":12}},{"id":"899bb10b-0112-486c-9b0a-845916f800d2","block_type":"box","text":"well as the credit strength of that institution. The risk associated with TOB Floaters, however, may be","page_number":411,"box":{"x":116,"y":444,"width":754,"height":12}},{"id":"80839ad8-5aa6-4798-bc71-8a9fc7f11013","block_type":"box","text":"increased in the current market environment as a result of recent downgrades to the credit ratings, and","page_number":411,"box":{"x":117,"y":459,"width":767,"height":12}},{"id":"93b48a37-b3ff-4267-9b4d-a25b72a73514","block_type":"box","text":"thus the perceived reliability and creditworthiness, of many major financial institutions, some of which","page_number":411,"box":{"x":116,"y":475,"width":755,"height":12}},{"id":"4c8651f2-59bd-4daf-a8e3-70d1d9562239","block_type":"box","text":"sponsor and/or provide liquidity support to TOB Trusts. This in turn may reduce the desirability of TOB","page_number":411,"box":{"x":116,"y":490,"width":763,"height":12}},{"id":"635184b1-4be2-4218-a704-6a9d2141a297","block_type":"box","text":"Floaters as investments, which could impair the viability or availability of TOB Trusts.","page_number":411,"box":{"x":117,"y":506,"width":633,"height":12}},{"id":"84c4c2f7-a911-4230-96c9-052bb1603e58","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into TOB Trust transactions,","page_number":411,"box":{"x":117,"y":537,"width":743,"height":12}},{"id":"f2f03c18-012a-45e8-b735-acd1dc495d87","block_type":"box","text":"reverse repurchase agreements and similar financing transactions (e.g., borrowed bonds)","page_number":411,"box":{"x":117,"y":552,"width":670,"height":12}},{"id":"f9aec64b-4db3-4284-a15d-f352273980ba","block_type":"box","text":"notwithstanding the limitation on the issuance of senior securities in Section 18 of the Investment","page_number":411,"box":{"x":117,"y":568,"width":723,"height":12}},{"id":"e1128793-18b2-426f-8456-c749ec31f550","block_type":"box","text":"Company Act, provided that the Fund either (i) complies with the 300% asset coverage ratio with","page_number":411,"box":{"x":117,"y":583,"width":721,"height":12}},{"id":"31773c1d-f45d-4a1a-8bc8-13a0c59a39de","block_type":"box","text":"respect to such transactions and any other borrowings in the aggregate, or (ii) treats such transactions","page_number":411,"box":{"x":117,"y":599,"width":764,"height":12}},{"id":"37a2d5f0-06ab-4fdd-9f33-1455b96b885a","block_type":"box","text":"as Derivatives Transactions under Rule 18f-4. See “— Derivatives — Regulation of Derivatives —","page_number":411,"box":{"x":116,"y":614,"width":730,"height":12}},{"id":"582ff76f-31ec-401a-98f6-1715155a424c","block_type":"box","text":"Rule 18f-4 under the Investment Company Act” above.","page_number":411,"box":{"x":117,"y":630,"width":411,"height":12}},{"id":"186653f4-04db-4ad4-b07d-81900ed0e9d0","block_type":"box","text":"Developments in the TOB Trust Market.","page_number":411,"box":{"x":116,"y":661,"width":295,"height":12}},{"id":"636404cf-c9dd-4fea-b330-99808fc70e0b","block_type":"box","text":"In response to the restrictions imposed by section 619 of the","page_number":411,"box":{"x":419,"y":661,"width":447,"height":12}},{"id":"2fbe1d44-5e36-42c0-9e3b-df21fa22a4f7","block_type":"box","text":"Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Volcker Rule”), market participants","page_number":411,"box":{"x":117,"y":676,"width":761,"height":12}},{"id":"b9d33da3-e37a-4e84-9068-8f8d9780fa38","block_type":"box","text":"have developed a structure for TOB Trusts designed to ensure that no banking entity is sponsoring the","page_number":411,"box":{"x":117,"y":692,"width":761,"height":12}},{"id":"539841ab-3cb9-4fdf-b320-dfcb8f5a919c","block_type":"box","text":"TOB Trust for purposes of the Volcker Rule. Specifically, a Fund will establish, structure and “sponsor”","page_number":411,"box":{"x":116,"y":707,"width":760,"height":12}},{"id":"c3bf4664-f38d-45b8-aeae-5ddd2ecb4957","block_type":"box","text":"the TOB Trusts in which it holds TOB Residuals. In such a structure, certain responsibilities that","page_number":411,"box":{"x":116,"y":723,"width":711,"height":12}},{"id":"718d7e1d-563c-4f3f-979a-0f766318f3d1","block_type":"box","text":"previously belonged to the sponsor bank will be performed by, or on behalf of, a Fund. A Fund may","page_number":411,"box":{"x":117,"y":738,"width":735,"height":12}},{"id":"7a3436e7-627f-46b7-932a-88178c85a933","block_type":"box","text":"utilize service providers in meeting these responsibilities. It is possible that regulators could take","page_number":411,"box":{"x":117,"y":754,"width":712,"height":12}},{"id":"a6960b3c-fbc6-4dce-8266-0a82b92a7d91","block_type":"box","text":"positions that could limit the market for such structured TOB Trust transactions or a Fund’s ability to","page_number":411,"box":{"x":117,"y":769,"width":738,"height":12}},{"id":"60c4f36d-a3c9-45c7-8836-b582497658fb","block_type":"box","text":"hold TOB Residuals. Under this TOB Trust structure, a Fund has certain additional duties and","page_number":411,"box":{"x":117,"y":785,"width":694,"height":11}},{"id":"817c67e0-b3d9-44a7-8fdb-d635bd1b4257","block_type":"box","text":"responsibilities, which may give rise to certain additional risks including","page_number":411,"box":{"x":117,"y":800,"width":525,"height":12}},{"id":"ff79e674-a7e9-4d90-96a9-5ccd06a3aeb6","block_type":"box","text":",","page_number":411,"box":{"x":643,"y":808,"width":3,"height":3}},{"id":"d3db3467-beb9-40ef-bceb-3ddd87f87bfe","block_type":"box","text":"but not limited to, compliance,","page_number":411,"box":{"x":653,"y":800,"width":221,"height":12}},{"id":"2104d7d8-a5fd-45e5-b554-5a35236c0ed8","block_type":"box","text":"securities law and operational risks.","page_number":411,"box":{"x":116,"y":816,"width":264,"height":12}},{"id":"37f321d1-b498-40fc-9b49-d13d03e3b449","block_type":"box","text":"Under this structure, service providers to a TOB Trust, such as administrators, liquidity providers,","page_number":411,"box":{"x":117,"y":847,"width":724,"height":12}},{"id":"1df33c72-6cc4-4805-95c3-60c0e5a499ed","block_type":"box","text":"trustees, and remarketing agents, act at the direction of, and as agent of, a Fund as the TOB Residual","page_number":411,"box":{"x":116,"y":862,"width":764,"height":12}},{"id":"8b68536b-fce9-4af9-9788-c5e90266103a","block_type":"box","text":"holder. Similar to the traditional tender option bond structure, a Fund deposits Municipal Bonds into the","page_number":411,"box":{"x":117,"y":878,"width":768,"height":12}},{"id":"20b436ea-6060-41c7-97f2-e928cec9aaf0","block_type":"box","text":"II-79","page_number":411,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"d317f56b-e04b-4736-a812-9939d82ff4f7","block_type":"box","text":"NM1026U-6004382-411/605","page_number":411,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4fa210f6-5624-48e2-95d4-4ef52e669da5","block_type":"box","text":"TOB Trust in exchange for TOB Residuals, the TOB Trust then issues and sells TOB Floaters to","page_number":412,"box":{"x":116,"y":87,"width":719,"height":12}},{"id":"0c2f5cc5-391a-41d8-9930-3793881ff3a2","block_type":"box","text":"third-party investors, and the proceeds of the sale of the TOB Floaters is distributed to such TOB","page_number":412,"box":{"x":116,"y":102,"width":723,"height":13}},{"id":"f7553ad9-b504-48de-80df-d04879d28598","block_type":"box","text":"Residual holders (","page_number":412,"box":{"x":117,"y":118,"width":134,"height":12}},{"id":"eb7252ac-c760-443b-b741-382fa30899d1","block_type":"box","text":"i.e.","page_number":412,"box":{"x":252,"y":118,"width":20,"height":10}},{"id":"47ca1764-ba23-4b02-95dd-3e3997179c03","block_type":"box","text":", the Fund). Tendered TOB Floaters continue to be supported by a remarketing","page_number":412,"box":{"x":275,"y":118,"width":591,"height":12}},{"id":"b7409889-9141-465c-8a40-51c2f2aab304","block_type":"box","text":"agent and a liquidity facility. However, the remarketing agent does not purchase tendered TOB","page_number":412,"box":{"x":116,"y":134,"width":708,"height":12}},{"id":"c587e783-9ff6-4fda-be72-2c47eeb7ee60","block_type":"box","text":"Floaters for its own account in the event of a failed remarketing, which may increase the likelihood that","page_number":412,"box":{"x":117,"y":149,"width":765,"height":12}},{"id":"429e9117-acf4-430d-b1d2-fcc85812e1a3","block_type":"box","text":"a TOB Trust will need to be collapsed and liquidated in order to purchase the tendered TOB Floaters.","page_number":412,"box":{"x":116,"y":165,"width":757,"height":11}},{"id":"7af2a5c7-8bac-4e3b-81df-87f0b42878d1","block_type":"box","text":"In the event of a failed remarketing of TOB Floaters, the Liquidity Provider, at its option, may advance","page_number":412,"box":{"x":117,"y":180,"width":758,"height":12}},{"id":"f8d85727-0d67-4dcd-b123-2c86b5452d8d","block_type":"box","text":"a loan to the TOB Trust the proceeds of which would be used by the TOB Trust to purchase the","page_number":412,"box":{"x":116,"y":196,"width":715,"height":12}},{"id":"493bc35c-9ec5-4818-aff4-b9cb0bfed174","block_type":"box","text":"tendered TOB Floaters. The Liquidity Provider is not obligated to advance such a loan. The TOB Trust","page_number":412,"box":{"x":116,"y":211,"width":764,"height":12}},{"id":"abe7f88d-9c1b-4f37-81d9-dc7d3f92a3ac","block_type":"box","text":"would be the borrower with respect to any such loan. Any loans made by a Liquidity Provider will be","page_number":412,"box":{"x":116,"y":227,"width":744,"height":12}},{"id":"f5e181a2-27f0-4919-b29d-1eeefe8d4701","block_type":"box","text":"secured by the purchased TOB Floaters held by the TOB Trust.","page_number":412,"box":{"x":116,"y":242,"width":477,"height":12}},{"id":"ac05d244-ee3d-488b-8925-409a327de5b0","block_type":"box","text":"Similar to the traditional structure for TOB Trusts, a Fund may hold either non-recourse TOB Residuals","page_number":412,"box":{"x":116,"y":270,"width":769,"height":12}},{"id":"9cd0d34f-fd58-4fdd-99aa-d7d4fd1a916d","block_type":"box","text":"or recourse TOB Residuals under this structure. In the event of a Liquidation Shortfall, there would","page_number":412,"box":{"x":116,"y":286,"width":735,"height":12}},{"id":"367f1d89-5e6b-4a9c-9caf-db2ef224d45c","block_type":"box","text":"generally be no contractual recourse to the Fund’s assets if the Fund holds a non-recourse TOB","page_number":412,"box":{"x":116,"y":301,"width":718,"height":13}},{"id":"8883c52a-ba85-46c7-8381-923824f57d4d","block_type":"box","text":"Residual. However, as described above, a Fund would bear the risk of loss with respect to any","page_number":412,"box":{"x":117,"y":317,"width":706,"height":12}},{"id":"e6c6f39f-7f8e-48c7-85d4-ab701d8e2b7a","block_type":"box","text":"Liquidation Shortfall if it holds a recourse TOB Residual.","page_number":412,"box":{"x":117,"y":332,"width":420,"height":12}},{"id":"16f643cd-7f73-41fe-98de-7f746c8caf28","block_type":"box","text":"The SEC and various federal banking and housing agencies adopted credit risk retention rules for","page_number":412,"box":{"x":116,"y":361,"width":730,"height":12}},{"id":"1b73f005-f036-4938-9849-83a7dc745822","block_type":"box","text":"securitizations (the “Risk Retention Rules”), which took effect in December 2016. The Risk Retention","page_number":412,"box":{"x":116,"y":376,"width":753,"height":12}},{"id":"5e49a3fa-fadc-4ee0-baf2-034d9f47f70a","block_type":"box","text":"Rules require the sponsor of a TOB Trust to retain at least 5% of the credit risk of the underlying assets","page_number":412,"box":{"x":117,"y":392,"width":771,"height":12}},{"id":"bcc2d40b-8ca0-4d50-9832-50161029339e","block_type":"box","text":"supporting the TOB Trust’s Municipal Bonds. The Risk Retention Rules may adversely affect the","page_number":412,"box":{"x":116,"y":407,"width":721,"height":12}},{"id":"267acefe-d347-44be-8f76-99616c3d0c7d","block_type":"box","text":"Fund’s ability to engage in TOB Trust transactions or increase the costs of such transactions in certain","page_number":412,"box":{"x":117,"y":423,"width":764,"height":12}},{"id":"1bd4917a-0e79-456a-bc6e-29f2344af6a3","block_type":"box","text":"circumstances.","page_number":412,"box":{"x":116,"y":438,"width":117,"height":10}},{"id":"40f80483-be2a-4503-8545-deacc3bf2216","block_type":"box","text":"TOB Trust transactions constitute an important component of the municipal bond market. Accordingly,","page_number":412,"box":{"x":116,"y":467,"width":763,"height":12}},{"id":"43d1741c-e858-4458-9c9b-ec8b36a77a15","block_type":"box","text":"implementation of the Volcker Rule may adversely impact the municipal market, including through","page_number":412,"box":{"x":117,"y":482,"width":729,"height":12}},{"id":"93dc386f-441f-46e7-8e7a-fedad8a7d01b","block_type":"box","text":"reduced demand for and liquidity of municipal bonds and increased financing costs for municipal","page_number":412,"box":{"x":117,"y":498,"width":719,"height":12}},{"id":"cb9e4757-bcd3-4f06-9205-fd77bf8f108b","block_type":"box","text":"issuers. Any such developments could adversely affect the Funds. The ultimate impact of these rules","page_number":412,"box":{"x":117,"y":513,"width":754,"height":12}},{"id":"5ecf987c-ce7a-4a40-a6a8-ce26bdf592b8","block_type":"box","text":"on the TOB market and the overall municipal market is not yet certain.","page_number":412,"box":{"x":116,"y":529,"width":520,"height":12}},{"id":"3c61ccb8-dc0d-47aa-8d57-94a2e84cc2f4","block_type":"box","text":"Yields.","page_number":412,"box":{"x":118,"y":557,"width":47,"height":10}},{"id":"fd06b9da-01d1-4797-9603-24b789085939","block_type":"box","text":"Yields on Municipal Bonds are dependent on a variety of factors, including the general","page_number":412,"box":{"x":166,"y":557,"width":650,"height":12}},{"id":"e744700f-4fff-4808-9b26-e6141d5e2fe9","block_type":"box","text":"condition of the money market and of the municipal bond market, the size of a particular offering, the","page_number":412,"box":{"x":116,"y":573,"width":751,"height":12}},{"id":"854557f5-0034-44da-8095-5fadc09f731a","block_type":"box","text":"financial condition of the issuer, the maturity of the obligation and the rating of the issue. The ability of","page_number":412,"box":{"x":116,"y":588,"width":759,"height":12}},{"id":"fbf49f55-ea90-4162-87ac-8c30779c529d","block_type":"box","text":"a Fund to achieve its investment objective is also dependent on the continuing ability of the issuers of","page_number":412,"box":{"x":116,"y":604,"width":757,"height":12}},{"id":"f8c1e7fd-a7f7-45b7-a12e-fbf4e9cf22c7","block_type":"box","text":"the securities in which the Fund invests to meet their obligations for the payment of interest and","page_number":412,"box":{"x":116,"y":619,"width":714,"height":12}},{"id":"ecb3072e-bed8-4b9c-9946-bba92e33923b","block_type":"box","text":"principal when due. There are variations in the risks involved in holding Municipal Bonds, both within a","page_number":412,"box":{"x":117,"y":635,"width":763,"height":12}},{"id":"987eae90-52f3-47f0-9df6-91720e446a27","block_type":"box","text":"particular classification and between classifications, depending on numerous factors. Furthermore, the","page_number":412,"box":{"x":117,"y":650,"width":763,"height":12}},{"id":"88fc211b-ce52-4c21-9e49-30d5853364b8","block_type":"box","text":"rights of owners of Municipal Bonds and the obligations of the issuer of such Municipal Bonds may be","page_number":412,"box":{"x":117,"y":666,"width":753,"height":12}},{"id":"a6a5a735-53a1-4531-8d3a-d77fc30d21d8","block_type":"box","text":"subject to applicable bankruptcy, insolvency and similar laws and court decisions affecting the rights of","page_number":412,"box":{"x":116,"y":681,"width":763,"height":12}},{"id":"a51cef62-c3d5-4b3a-bd03-740183d72b8c","block_type":"box","text":"creditors generally and to general equitable principles, which may limit the enforcement of certain","page_number":412,"box":{"x":116,"y":697,"width":721,"height":12}},{"id":"236c2aca-8f18-4a12-b738-224a7d389668","block_type":"box","text":"remedies.","page_number":412,"box":{"x":117,"y":712,"width":71,"height":10}},{"id":"6fa06bfa-d139-4d5e-bd88-9eccd034f61f","block_type":"box","text":"Variable Rate Demand Obligations (“VRDOs”).","page_number":412,"box":{"x":118,"y":740,"width":344,"height":13}},{"id":"57edcd60-5358-49fe-a240-8c45a545b181","block_type":"box","text":"VRDOs are tax-exempt obligations that contain a","page_number":412,"box":{"x":468,"y":740,"width":365,"height":13}},{"id":"2c6dcbcb-253a-4fc1-938c-492b2b616594","block_type":"box","text":"floating or variable interest rate adjustment formula and a right of demand on the part of the holder","page_number":412,"box":{"x":116,"y":756,"width":731,"height":12}},{"id":"ea71404a-960d-4d62-8572-67842f61e321","block_type":"box","text":"thereof to receive payment of the unpaid principal balance plus accrued interest upon a short notice","page_number":412,"box":{"x":116,"y":771,"width":739,"height":13}},{"id":"c986f7d8-be71-4c26-aa29-06b2345879d2","block_type":"box","text":"period not to exceed seven days.","page_number":412,"box":{"x":117,"y":787,"width":244,"height":12}},{"id":"0f7ea40d-43ce-4dcb-9921-4fc41472eca6","block_type":"box","text":"There is the possibility that because of default or insolvency the demand feature of VRDOs may not be","page_number":412,"box":{"x":116,"y":815,"width":763,"height":12}},{"id":"b45d56f2-9f52-4e0a-86f3-fb5894301c90","block_type":"box","text":"honored. The interest rates are adjustable at periodic intervals to some prevailing market rate for","page_number":412,"box":{"x":117,"y":831,"width":721,"height":12}},{"id":"67d9dfde-6a81-4ef2-9276-a6f05367a265","block_type":"box","text":"similar investments, such adjustment formula being calculated to maintain the market rate of the","page_number":412,"box":{"x":116,"y":846,"width":718,"height":12}},{"id":"1a468961-bbe0-477b-9b3f-16fbee6b2851","block_type":"box","text":"VRDOs at approximately the par value of the VRDOs on the adjustment date. The adjustments","page_number":412,"box":{"x":116,"y":862,"width":710,"height":12}},{"id":"7a23ead5-ac7b-450d-add9-a03991b57048","block_type":"box","text":"typically are based upon the Securities Industry and Financial Markets Association (“SIFMA”) Index.","page_number":412,"box":{"x":116,"y":877,"width":746,"height":12}},{"id":"67432b0f-4382-48e8-b4b5-657a29be3de6","block_type":"box","text":"II-80","page_number":412,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"8e222919-120b-4b52-bd7d-4dcf7ab1a18f","block_type":"box","text":"NM1026U-6004382-412/605","page_number":412,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6f45a305-f390-4011-ac72-502246875b6a","block_type":"box","text":"Because of the interest rate adjustment formula on VRDOs, VRDOs are not comparable to fixed rate","page_number":413,"box":{"x":117,"y":87,"width":751,"height":12}},{"id":"df0a1470-8a57-43c9-9d29-cf43b1f9a3f2","block_type":"box","text":"securities. During periods of declining interest rates, a Fund’s yield on a VRDO will decrease and its","page_number":413,"box":{"x":116,"y":102,"width":746,"height":13}},{"id":"4e39bd5b-5e72-4b42-822a-7d40d8312eeb","block_type":"box","text":"shareholders will forego the opportunity for capital appreciation. During periods of rising interest rates,","page_number":413,"box":{"x":116,"y":118,"width":761,"height":12}},{"id":"bc238842-ce5a-4dbb-8a16-8f9aa0b58ff3","block_type":"box","text":"however, a Fund’s yield on a VRDO will increase and the Fund’s shareholders will have a reduced risk","page_number":413,"box":{"x":117,"y":134,"width":764,"height":12}},{"id":"9ceec576-3cf5-4681-aacd-af2fcad12d7e","block_type":"box","text":"of capital depreciation.","page_number":413,"box":{"x":116,"y":149,"width":173,"height":12}},{"id":"e939bc9d-05f4-4874-9444-0f9779183d6b","block_type":"box","text":"Transactions in Financial Futures Contracts on Municipal Indexes.","page_number":413,"box":{"x":118,"y":180,"width":488,"height":12}},{"id":"e24f1b0b-a7f3-4350-84fd-768502691d5a","block_type":"box","text":"The Municipal Funds and certain","page_number":413,"box":{"x":608,"y":180,"width":253,"height":12}},{"id":"d4a71895-a4e2-485d-aa29-d85ad02d7f6a","block_type":"box","text":"other funds deal in financial futures contracts based on a long-term municipal bond index developed by","page_number":413,"box":{"x":116,"y":196,"width":770,"height":12}},{"id":"e33f52f7-6247-4316-bce4-c3dcfa6d5fb2","block_type":"box","text":"the Chicago Board of Trade (“CBT”) and The Bond Buyer (the “Municipal Bond Index”). The Municipal","page_number":413,"box":{"x":116,"y":211,"width":761,"height":12}},{"id":"d516d18f-10d2-4ad2-a0fa-24b2c7d4343b","block_type":"box","text":"Bond Index is comprised of 40 long-term, actively traded tax-exempt municipal revenue and general","page_number":413,"box":{"x":117,"y":227,"width":746,"height":12}},{"id":"8dc8b4bf-efb4-4b26-b682-b84e0955d161","block_type":"box","text":"obligation bonds. Each bond included in the Municipal Bond Index must be rated A or higher by","page_number":413,"box":{"x":116,"y":242,"width":712,"height":12}},{"id":"f07b8be5-036c-41ec-8156-8d8240e183fb","block_type":"box","text":"Moody’s or S&P and must have a remaining maturity of 19 years or more. Twice a month new issues","page_number":413,"box":{"x":117,"y":258,"width":754,"height":12}},{"id":"cac0178a-27d9-441a-9211-f765c838abcc","block_type":"box","text":"satisfying the eligibility requirements are added to, and an equal number of old issues are deleted from,","page_number":413,"box":{"x":116,"y":273,"width":771,"height":12}},{"id":"ddb1cb44-2064-42eb-94ba-cd9be64ad9e0","block_type":"box","text":"the Municipal Bond Index. The value of the Municipal Bond Index is computed daily according to a","page_number":413,"box":{"x":116,"y":289,"width":734,"height":12}},{"id":"35707d4d-db0c-4ff5-8052-fcc902c23f27","block_type":"box","text":"formula based on the price of each bond in the Municipal Bond Index, as evaluated by six","page_number":413,"box":{"x":116,"y":304,"width":670,"height":12}},{"id":"981bf360-8c89-43fa-b400-f1cd70f1b125","block_type":"box","text":"dealer-to-dealer brokers.","page_number":413,"box":{"x":116,"y":320,"width":189,"height":9}},{"id":"49e1027e-ce46-40e9-beac-2d04f581f1c2","block_type":"box","text":"The Municipal Bond Index futures contract is traded only on the CBT. Like other contract markets, the","page_number":413,"box":{"x":116,"y":351,"width":760,"height":12}},{"id":"b649b2ba-5277-422d-b628-1a2e12412c9b","block_type":"box","text":"CBT assures performance under futures contracts through a clearing corporation, a nonprofit","page_number":413,"box":{"x":117,"y":366,"width":694,"height":12}},{"id":"6bab8965-fce8-4bc9-add3-0247a369f8c0","block_type":"box","text":"organization managed by the exchange membership that is also responsible for handling daily","page_number":413,"box":{"x":116,"y":382,"width":704,"height":12}},{"id":"11a35892-865a-457f-b0e9-03c3142ea087","block_type":"box","text":"accounting of deposits or withdrawals of margin.","page_number":413,"box":{"x":116,"y":397,"width":364,"height":12}},{"id":"69cd67be-9558-4125-b7db-cf30e289d497","block_type":"box","text":"The particular municipal bonds comprising the index underlying the Municipal Bond Index financial","page_number":413,"box":{"x":116,"y":428,"width":735,"height":12}},{"id":"fbc2965f-a757-4613-b00e-096a25da5257","block_type":"box","text":"futures contract may vary from the bonds held by a Municipal Fund. As a result, a Municipal Fund’s","page_number":413,"box":{"x":116,"y":444,"width":741,"height":12}},{"id":"0b35bcb3-cc71-49ec-9b98-71dfa265fe6c","block_type":"box","text":"ability to hedge effectively all or a portion of the value of its Municipal Bonds through the use of such","page_number":413,"box":{"x":116,"y":459,"width":749,"height":12}},{"id":"c9b54f77-36ae-47ca-984c-70173bf2ad30","block_type":"box","text":"financial futures contracts will depend in part on the degree to which price movements in the index","page_number":413,"box":{"x":116,"y":475,"width":734,"height":12}},{"id":"e0dd1bb5-804e-4025-b2d5-e8749896a6db","block_type":"box","text":"underlying the financial futures contract correlate with the price movements of the Municipal Bonds","page_number":413,"box":{"x":117,"y":490,"width":737,"height":12}},{"id":"c924ad46-4bd0-4e5c-a3cf-6da053ab313c","block_type":"box","text":"held by the Fund. The correlation may be affected by disparities in the average maturity, ratings,","page_number":413,"box":{"x":117,"y":506,"width":718,"height":12}},{"id":"ed771db2-bfe8-429f-ab5c-d703655a0020","block_type":"box","text":"geographical mix or structure of a Municipal Fund’s investments as compared to those comprising the","page_number":413,"box":{"x":116,"y":521,"width":760,"height":12}},{"id":"5aaaf374-787a-4584-87cb-ffab5134725a","block_type":"box","text":"Municipal Bond Index and general economic or political factors. In addition, the correlation between","page_number":413,"box":{"x":117,"y":537,"width":741,"height":12}},{"id":"5355bd7e-95a3-48ed-b94b-7dbffea7607b","block_type":"box","text":"movements in the value of the Municipal Bond Index may be subject to change over time as additions","page_number":413,"box":{"x":117,"y":552,"width":759,"height":12}},{"id":"a9adeb29-d899-4de3-b3f4-fbfe7f12d4a0","block_type":"box","text":"to and deletions from the Municipal Bond Index alter its structure. The correlation between futures","page_number":413,"box":{"x":116,"y":568,"width":731,"height":12}},{"id":"e642af2f-27a5-462f-bdb4-0fab2de718f6","block_type":"box","text":"contracts on U.S. Government Securities and the Municipal Bonds held by a Municipal Fund may be","page_number":413,"box":{"x":116,"y":583,"width":750,"height":12}},{"id":"5e5ea3c2-e518-420c-9693-af609adaa0b5","block_type":"box","text":"adversely affected by similar factors and the risk of imperfect correlation between movements in the","page_number":413,"box":{"x":116,"y":599,"width":746,"height":12}},{"id":"d923f96f-6b1f-4396-b485-57137522f453","block_type":"box","text":"prices of such futures contracts and the prices of Municipal Bonds held by a Municipal Fund may be","page_number":413,"box":{"x":117,"y":614,"width":745,"height":12}},{"id":"616f67ef-055f-477e-9748-0da959175618","block_type":"box","text":"greater. Municipal Bond Index futures contracts were approved for trading in 1985. Trading in such","page_number":413,"box":{"x":116,"y":630,"width":738,"height":12}},{"id":"1e9e650e-9f3c-4615-8725-433e0a917b22","block_type":"box","text":"futures contracts may tend to be less liquid than trading in other futures contracts. The trading of","page_number":413,"box":{"x":116,"y":645,"width":721,"height":12}},{"id":"03b2cecd-e9a8-4e9c-8db1-7f013f98fac0","block_type":"box","text":"futures contracts also is subject to certain market risks, such as inadequate trading activity, which","page_number":413,"box":{"x":116,"y":661,"width":723,"height":12}},{"id":"e79add72-7c27-48c7-a711-685caf993b89","block_type":"box","text":"could at times make it difficult or impossible to liquidate existing positions.","page_number":413,"box":{"x":116,"y":676,"width":545,"height":12}},{"id":"46948e5d-c8a4-4f65-a1cf-1c404d41b8ee","block_type":"box","text":"Call Rights.","page_number":413,"box":{"x":117,"y":707,"width":83,"height":12}},{"id":"2d2f45c0-3ee1-4fe4-905c-f7ef9886e0d1","block_type":"box","text":"A Fund may purchase a Municipal Bond issuer’s right to call all or a portion of such","page_number":413,"box":{"x":206,"y":707,"width":616,"height":12}},{"id":"5a3991be-91dc-4072-a9c3-389f7a57928d","block_type":"box","text":"Municipal Bond for mandatory tender for purchase (a “Call Right”). A holder of a Call Right may","page_number":413,"box":{"x":117,"y":723,"width":706,"height":12}},{"id":"c32443de-c002-4674-b962-434903e3d5a7","block_type":"box","text":"exercise such right to require a mandatory tender for the purchase of related Municipal Bonds, subject","page_number":413,"box":{"x":116,"y":738,"width":759,"height":12}},{"id":"02729425-cde4-4aaf-88ce-67a951602ef1","block_type":"box","text":"to certain conditions. A Call Right that is not exercised prior to maturity of the related Municipal Bond","page_number":413,"box":{"x":116,"y":754,"width":745,"height":12}},{"id":"49fd9e29-9a2a-443c-b0d9-d48f78f9777a","block_type":"box","text":"will expire without value. The economic effect of holding both the Call Right and the related Municipal","page_number":413,"box":{"x":116,"y":769,"width":750,"height":12}},{"id":"56963540-5ba2-43f6-8ba8-fd318d90bb11","block_type":"box","text":"Bond is identical to holding a Municipal Bond as a non-callable security. Certain investments in such","page_number":413,"box":{"x":117,"y":785,"width":742,"height":12}},{"id":"d1fd0fab-8ca3-4dd0-9cb1-a92212faed1b","block_type":"box","text":"obligations may be illiquid.","page_number":413,"box":{"x":116,"y":800,"width":195,"height":12}},{"id":"689fcc52-1947-45cd-8730-355128677952","block_type":"box","text":"Municipal Interest Rate Swap Transactions.","page_number":413,"box":{"x":116,"y":831,"width":305,"height":12}},{"id":"a0525b08-0307-474a-b830-00a124ef05bd","block_type":"box","text":"In order to hedge the value of a Fund against interest rate","page_number":413,"box":{"x":423,"y":831,"width":414,"height":12}},{"id":"1bb22dae-bd35-4154-a37f-7a9081a30185","block_type":"box","text":"fluctuations or to enhance a Fund’s income, a Fund may enter into interest rate swap transactions such as","page_number":413,"box":{"x":116,"y":847,"width":750,"height":12}},{"id":"46204fb9-c429-49e9-ab45-410b521681d3","block_type":"box","text":"Municipal Market Data AAA Cash Curve swaps (“MMD Swaps”) or Securities Industry and Financial Markets","page_number":413,"box":{"x":117,"y":862,"width":767,"height":12}},{"id":"c7bddce9-5348-49f5-b3d5-0e3df17378af","block_type":"box","text":"Association Municipal Swap Index swaps (“SIFMA Swaps”). To the extent that a Fund enters into these","page_number":413,"box":{"x":116,"y":878,"width":730,"height":12}},{"id":"2ba84801-2dc1-49fb-8bea-10ef862b90e5","block_type":"box","text":"II-81","page_number":413,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"aeceee23-d014-4c82-98fc-d7fa16e74fff","block_type":"box","text":"NM1026U-6004382-413/605","page_number":413,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b34dc2a1-fb33-4e76-958e-914f4ba08c51","block_type":"box","text":"transactions, the Fund expects to do so primarily to preserve a return or spread on a particular investment or","page_number":414,"box":{"x":116,"y":87,"width":765,"height":12}},{"id":"f74e7133-1efd-4450-bc60-6b67a569de06","block_type":"box","text":"portion of its portfolio or to protect against any increase in the price of securities the Fund anticipates","page_number":414,"box":{"x":117,"y":102,"width":707,"height":13}},{"id":"3348eeeb-8b7a-4994-9034-06434e39b766","block_type":"box","text":"purchasing at a later date. A Fund intends to use these transactions primarily as a hedge rather than as a","page_number":414,"box":{"x":117,"y":118,"width":743,"height":12}},{"id":"367a92cc-cc19-424b-bd82-687ea3f9bcf6","block_type":"box","text":"speculative investment. However, a Fund also may invest in MMD Swaps and SIFMA Swaps to enhance","page_number":414,"box":{"x":116,"y":134,"width":743,"height":12}},{"id":"c38e6eb7-9003-462c-b256-9ba1778d9cf2","block_type":"box","text":"income or gain or to increase the Fund’s yield, for example, during periods of steep interest rate yield curves","page_number":414,"box":{"x":117,"y":149,"width":762,"height":12}},{"id":"108dfa63-168d-4ec3-9f72-0943999a60e4","block_type":"box","text":"(","page_number":414,"box":{"x":117,"y":165,"width":4,"height":12}},{"id":"bffac892-0fa7-43bf-8077-fc54725c9baf","block_type":"box","text":"i.e.","page_number":414,"box":{"x":121,"y":165,"width":19,"height":9}},{"id":"f76829cc-e076-47e1-8614-63d75c4a74b8","block_type":"box","text":", wide differences between short-term and long-term interest rates).","page_number":414,"box":{"x":143,"y":165,"width":477,"height":12}},{"id":"f6ba8f43-64a5-479f-8736-a27156e2cb13","block_type":"box","text":"A Fund may purchase and sell SIFMA Swaps in the SIFMA swap market. In a SIFMA Swap, a Fund","page_number":414,"box":{"x":116,"y":196,"width":747,"height":12}},{"id":"b90a440f-1479-41e0-b97a-b0fb17cb081c","block_type":"box","text":"exchanges with another party their respective commitments to pay or receive interest (","page_number":414,"box":{"x":116,"y":211,"width":642,"height":12}},{"id":"16ad2772-727d-49f3-b306-e13abf57a9ef","block_type":"box","text":"e.g.","page_number":414,"box":{"x":760,"y":214,"width":25,"height":9}},{"id":"bd645afc-6a2b-4054-afad-b926a035a973","block_type":"box","text":", an","page_number":414,"box":{"x":788,"y":214,"width":32,"height":8}},{"id":"44e13157-2a03-45f0-9666-9b12a3d7f904","block_type":"box","text":"exchange of fixed rate payments for floating rate payments linked to the SIFMA Municipal Swap","page_number":414,"box":{"x":116,"y":227,"width":717,"height":12}},{"id":"b7e8d7a2-8266-446b-9952-a67640bfa950","block_type":"box","text":"Index). Because the underlying index is a tax-exempt index, SIFMA Swaps may reduce cross-market","page_number":414,"box":{"x":117,"y":242,"width":755,"height":12}},{"id":"e1a4d36b-003b-4675-a5b2-05097851acf8","block_type":"box","text":"risks incurred by a Fund and increase a Fund’s ability to hedge effectively. SIFMA Swaps are typically","page_number":414,"box":{"x":117,"y":258,"width":760,"height":12}},{"id":"d627e660-d06b-495f-bbd4-859a93a0776f","block_type":"box","text":"quoted for the entire yield curve, beginning with a seven day floating rate index out to 30 years. The","page_number":414,"box":{"x":116,"y":273,"width":745,"height":12}},{"id":"67bb88b0-622e-43fa-be2d-8ad2e1ab9410","block_type":"box","text":"duration of a SIFMA Swap is approximately equal to the duration of a fixed-rate Municipal Bond with","page_number":414,"box":{"x":116,"y":289,"width":747,"height":12}},{"id":"263c97b9-803d-445b-97ae-e2de66340eb3","block_type":"box","text":"the same attributes as the swap (","page_number":414,"box":{"x":116,"y":304,"width":247,"height":12}},{"id":"8988d302-11e6-4906-81b6-5ec5471c3983","block_type":"box","text":"e.g.","page_number":414,"box":{"x":365,"y":307,"width":25,"height":9}},{"id":"1779cd25-b667-4229-b15b-740c2060f376","block_type":"box","text":", coupon, maturity, call feature).","page_number":414,"box":{"x":393,"y":304,"width":240,"height":12}},{"id":"d0cf440c-ce49-42bb-b3ba-9ad6b2feeef2","block_type":"box","text":"A Fund may also purchase and sell MMD Swaps, also known as MMD rate locks. An MMD Swap","page_number":414,"box":{"x":116,"y":335,"width":727,"height":12}},{"id":"985ce71f-ffb2-4f50-aa7a-e46a51d4da8d","block_type":"box","text":"permits a Fund to lock in a specified municipal interest rate for a portion of its portfolio to preserve a","page_number":414,"box":{"x":117,"y":351,"width":744,"height":12}},{"id":"72c22df1-8d06-43a4-b93c-b67f47e21a99","block_type":"box","text":"return on a particular investment or a portion of its portfolio as a duration management technique or to","page_number":414,"box":{"x":117,"y":366,"width":761,"height":12}},{"id":"d5f9396e-e926-480b-9513-55104101f6c8","block_type":"box","text":"protect against any increase in the price of securities to be purchased at a later date. By using an MMD","page_number":414,"box":{"x":117,"y":382,"width":771,"height":12}},{"id":"396b22d6-e355-46c9-bb7c-396db5ca00a3","block_type":"box","text":"Swap, a Fund can create a synthetic long or short position, allowing the Fund to select the most","page_number":414,"box":{"x":116,"y":397,"width":715,"height":12}},{"id":"d429e737-2296-4243-8c3e-8f7d560b4708","block_type":"box","text":"attractive part of the yield curve. An MMD Swap is a contract between a Fund and an MMD Swap","page_number":414,"box":{"x":116,"y":413,"width":729,"height":12}},{"id":"f6e84f1e-30b4-4a66-bfb6-ba11a734cff6","block_type":"box","text":"provider pursuant to which the parties agree to make payments to each other on a notional amount,","page_number":414,"box":{"x":117,"y":428,"width":744,"height":12}},{"id":"fef5eac4-b29b-4b2b-b7dc-fb2c4a6990ac","block_type":"box","text":"contingent upon whether the Municipal Market Data AAA General Obligation Scale is above or below a","page_number":414,"box":{"x":116,"y":444,"width":769,"height":12}},{"id":"85f10b8b-4cfd-4de4-a1aa-a2a0593ee67e","block_type":"box","text":"specified level on the expiration date of the contract. For example, if a Fund buys an MMD Swap and","page_number":414,"box":{"x":116,"y":459,"width":754,"height":12}},{"id":"4cd45ed9-c54d-4eae-8859-dd09baa5d224","block_type":"box","text":"the Municipal Market Data AAA General Obligation Scale is below the specified level on the expiration","page_number":414,"box":{"x":116,"y":475,"width":763,"height":12}},{"id":"38538ede-cc3d-47c5-8c20-385cc3e95b1f","block_type":"box","text":"date, the counterparty to the contract will make a payment to the Fund equal to the specified level","page_number":414,"box":{"x":116,"y":490,"width":730,"height":12}},{"id":"de5042dd-e00e-4ab8-94ed-f0ff752d8f8f","block_type":"box","text":"minus the actual level, multiplied by the notional amount of the contract. If the Municipal Market Data","page_number":414,"box":{"x":117,"y":506,"width":751,"height":12}},{"id":"f44f6140-0b54-492d-b52d-6c4b03045703","block_type":"box","text":"AAA General Obligation Scale is above the specified level on the expiration date, a Fund will make a","page_number":414,"box":{"x":116,"y":521,"width":752,"height":12}},{"id":"6a4d57ad-6702-48c3-a5ff-78fe1299b473","block_type":"box","text":"payment to the counterparty equal to the actual level minus the specified level, multiplied by the","page_number":414,"box":{"x":117,"y":537,"width":714,"height":12}},{"id":"ec1eed70-4c31-45a5-89e1-05fa4938d17e","block_type":"box","text":"notional amount of the contract.","page_number":414,"box":{"x":117,"y":552,"width":239,"height":10}},{"id":"63607287-79ec-4e0e-a361-7be10d1bd3b7","block_type":"box","text":"In connection with investments in SIFMA and MMD Swaps,","page_number":414,"box":{"x":117,"y":583,"width":444,"height":12}},{"id":"ee151f80-f520-465f-9698-4337f83d67bf","block_type":"box","text":"there is a risk that municipal yields will","page_number":414,"box":{"x":561,"y":583,"width":289,"height":12}},{"id":"912e22d4-067b-4de7-818d-13bc688e78c4","block_type":"box","text":"move in the opposite direction than anticipated by a Fund, which would cause the Fund to make","page_number":414,"box":{"x":117,"y":599,"width":716,"height":12}},{"id":"10c93120-4a21-4b70-94dc-7ecd48d1a17a","block_type":"box","text":"payments to its counterparty in the transaction that could adversely affect the Fund’s performance.","page_number":414,"box":{"x":117,"y":614,"width":735,"height":12}},{"id":"56a18045-c8f7-4634-991a-64432036f760","block_type":"box","text":"Insured Municipal Bonds.","page_number":414,"box":{"x":117,"y":645,"width":186,"height":12}},{"id":"7abf5baf-5c25-4207-9f2a-232ac6d171f4","block_type":"box","text":"Bonds purchased by a Fund may be covered by insurance that guarantees","page_number":414,"box":{"x":305,"y":645,"width":566,"height":12}},{"id":"e6be2a6e-c0b1-4d78-8608-a56a14912503","block_type":"box","text":"that interest payments on the bond will be made on time and the principal will be repaid when the bond","page_number":414,"box":{"x":116,"y":661,"width":762,"height":12}},{"id":"227d9afe-de76-494f-b4c9-197e460f2ebe","block_type":"box","text":"matures. Either the issuer of the bond or the Fund purchases the insurance. Insurance is expected to","page_number":414,"box":{"x":117,"y":676,"width":750,"height":12}},{"id":"d5ae643f-2964-40d4-9b2c-372bcb08511a","block_type":"box","text":"protect the Fund against losses caused by a bond issuer’s failure to make interest or principal","page_number":414,"box":{"x":117,"y":692,"width":693,"height":12}},{"id":"9db28689-2142-4991-a353-9e23b841006b","block_type":"box","text":"payments. However, insurance does not protect the Fund or its shareholders against losses caused by","page_number":414,"box":{"x":117,"y":707,"width":762,"height":12}},{"id":"036699e0-a644-4b55-b3c5-bd79825881a5","block_type":"box","text":"declines in a bond’s market value. Also, the Fund cannot be certain that any insurance company does","page_number":414,"box":{"x":116,"y":723,"width":756,"height":12}},{"id":"0d76f87b-6f09-45d7-b783-e53777aecf6a","block_type":"box","text":"not make these payments. In addition, if the Fund purchases the insurance, it may pay the premiums,","page_number":414,"box":{"x":117,"y":738,"width":752,"height":12}},{"id":"7910ec97-125d-48ba-94de-58a257ca8035","block_type":"box","text":"which will reduce the Fund’s yield. The Fund seeks to use only insurance companies with claims","page_number":414,"box":{"x":116,"y":754,"width":715,"height":12}},{"id":"b7d014e3-5e5b-459f-935d-637125327833","block_type":"box","text":"paying ability, financial strength, or equivalent ratings of at least investment grade. However, if","page_number":414,"box":{"x":117,"y":769,"width":699,"height":12}},{"id":"3a609d5b-22ee-497c-8e01-a4011b36bfab","block_type":"box","text":"insurance from insurers with these ratings is not available, the Fund may use insurance companies","page_number":414,"box":{"x":117,"y":785,"width":733,"height":12}},{"id":"cb2e78db-2ef3-4681-a96b-7758c9e9c77f","block_type":"box","text":"with lower ratings or stop purchasing insurance or insured bonds. If a bond’s insurer fails to fulfill its","page_number":414,"box":{"x":116,"y":800,"width":736,"height":12}},{"id":"e1b6908d-c952-43c0-a437-7f8c0cf4e691","block_type":"box","text":"obligations or loses its credit rating, the value of the bond could drop.","page_number":414,"box":{"x":116,"y":816,"width":511,"height":12}},{"id":"939f1515-f56d-4f8b-b36d-a4dd40021744","block_type":"box","text":"Build America Bonds.","page_number":414,"box":{"x":116,"y":847,"width":159,"height":9}},{"id":"572f91f7-e482-42ff-b249-9969bca05c48","block_type":"box","text":"If a Fund holds Build America Bonds, the Fund may be eligible to receive a U.S.","page_number":414,"box":{"x":276,"y":847,"width":604,"height":12}},{"id":"398aba40-35d9-4123-bb5c-c2d5af9d8f0a","block_type":"box","text":"federal income tax credit; however, the issuer of a Build America Bond may instead elect to receive a","page_number":414,"box":{"x":116,"y":862,"width":756,"height":12}},{"id":"0da6d35e-e4d3-4619-be18-edc736fdee90","block_type":"box","text":"cash payment directly from the federal government in lieu of holders such as the fund receiving a tax","page_number":414,"box":{"x":116,"y":878,"width":752,"height":12}},{"id":"7ce0aee0-e423-4d9f-b31d-260f7a7e255d","block_type":"box","text":"II-82","page_number":414,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"bec9894a-5197-4d05-b305-c647c1eb01a4","block_type":"box","text":"NM1026U-6004382-414/605","page_number":414,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"05d0f6d7-bd2e-4aee-b5a7-506397833f0d","block_type":"box","text":"credit. The interest on Build America Bonds is taxable for U.S. federal income tax purposes. If the Fund","page_number":415,"box":{"x":116,"y":87,"width":772,"height":12}},{"id":"84ffac8d-2d95-4b2d-b88c-3f1c096aa0c6","block_type":"box","text":"does receive tax credits from Build America Bonds or other tax credit bonds on one or more specified","page_number":415,"box":{"x":116,"y":102,"width":757,"height":12}},{"id":"2308c910-377d-4d6d-8043-aa8640aa5666","block_type":"box","text":"dates during the fund’s taxable year, and the Fund satisfies the minimum distribution requirement, the","page_number":415,"box":{"x":116,"y":118,"width":760,"height":12}},{"id":"5b089c5a-a0be-4f3c-9daa-3e9173f02005","block_type":"box","text":"Fund may elect for U.S. federal income tax purposes to pass through to shareholders tax credits","page_number":415,"box":{"x":117,"y":134,"width":719,"height":12}},{"id":"e5152940-b389-474f-9a53-b02003fb9238","block_type":"box","text":"otherwise allowable to the Fund for that year with respect to such bonds. A tax credit bond is defined in","page_number":415,"box":{"x":116,"y":149,"width":770,"height":12}},{"id":"64710c23-640a-4101-a699-2d434b18da06","block_type":"box","text":"the Code as a “qualified tax credit bond” (which includes a qualified forestry conservation bond, a new","page_number":415,"box":{"x":116,"y":165,"width":761,"height":12}},{"id":"d122dd83-bc8b-4776-97af-9aba94e301cb","block_type":"box","text":"clean renewable energy bond, a qualified energy conservation bond, or a qualified zone academy","page_number":415,"box":{"x":116,"y":180,"width":729,"height":12}},{"id":"126e29fb-b744-4856-b9ac-a892e83004e9","block_type":"box","text":"bond, each of which must meet certain requirements specified in the Code), a “Build America Bond”","page_number":415,"box":{"x":117,"y":196,"width":744,"height":12}},{"id":"859e358d-01cc-4fd8-9182-0bfef8a3928c","block_type":"box","text":"(which includes certain qualified bonds issued before January 1, 2011) or certain other specified","page_number":415,"box":{"x":117,"y":211,"width":717,"height":12}},{"id":"6b671929-6eee-49e3-8edd-593fb8a5fa38","block_type":"box","text":"bonds. If the Fund were to so elect, a shareholder would be required to include in income and would be","page_number":415,"box":{"x":117,"y":227,"width":771,"height":11}},{"id":"cb5a38ed-d425-4e43-a4e1-cf26079b7898","block_type":"box","text":"entitled to claim as a tax credit an amount equal to a proportionate share of such credits, and such","page_number":415,"box":{"x":116,"y":242,"width":735,"height":12}},{"id":"585a0500-66fc-410e-b035-7b2e91f71c7a","block_type":"box","text":"amount would be subject to withholding provisions of the Code. Certain limitations may apply on the","page_number":415,"box":{"x":116,"y":258,"width":746,"height":12}},{"id":"0eb3b43a-1c6d-471d-be31-89648b88979a","block_type":"box","text":"extent to which the credit may be claimed.","page_number":415,"box":{"x":116,"y":273,"width":318,"height":12}},{"id":"fb05c212-755c-4b34-ab5d-50043a32ed6f","block_type":"box","text":"Tax-Exempt Municipal Investments.","page_number":415,"box":{"x":118,"y":304,"width":263,"height":12}},{"id":"bc327e7d-45a6-4f7f-9f8c-028ca79a4f25","block_type":"box","text":"Certain Funds may hold tax-exempt municipal investments which","page_number":415,"box":{"x":382,"y":304,"width":494,"height":12}},{"id":"c8a9ae20-928e-400d-bf1e-bf74e7dfebe4","block_type":"box","text":"may be in the form of tender option bonds, variable rate demand obligations, participations, beneficial","page_number":415,"box":{"x":117,"y":320,"width":757,"height":12}},{"id":"b942218e-a2ff-4c9d-a3a2-1f0a144d19a7","block_type":"box","text":"interests in a trust, partnership interests or other forms. These investments are described in greater","page_number":415,"box":{"x":117,"y":335,"width":741,"height":12}},{"id":"63aee41a-2b1b-48de-a1f3-5f6aa43d0adf","block_type":"box","text":"detail above in this section. Some of the structures used by certain Funds include interests in long-term","page_number":415,"box":{"x":116,"y":351,"width":771,"height":12}},{"id":"9566bca7-3816-476d-bee5-fa84286846e3","block_type":"box","text":"fixed-rate municipal debt obligations, held by a trustee or custodian, that are coupled with tender","page_number":415,"box":{"x":116,"y":366,"width":720,"height":12}},{"id":"cc88dfd2-7206-4fa2-9420-994dc1c778d7","block_type":"box","text":"option, demand and other features when the tax-exempt municipal investments are created. Together,","page_number":415,"box":{"x":116,"y":382,"width":764,"height":12}},{"id":"d18236fb-8703-457f-8c26-3a35ede26fd0","block_type":"box","text":"these features entitle the holder of the interest to tender (or put) the underlying municipal debt","page_number":415,"box":{"x":116,"y":397,"width":701,"height":12}},{"id":"e5d5ec76-e2f3-4260-a52c-fc44c26403eb","block_type":"box","text":"obligation to a third party at periodic intervals and to receive the principal amount thereof.","page_number":415,"box":{"x":116,"y":413,"width":667,"height":12}},{"id":"d3402a26-58fe-4200-86d3-a4f2d46b5d5a","block_type":"box","text":"In some cases, municipal debt obligations are represented by custodial receipts evidencing rights to","page_number":415,"box":{"x":117,"y":444,"width":745,"height":12}},{"id":"92a95338-6f66-49b9-92a5-3fec91ddbcc5","block_type":"box","text":"receive specific future interest payments, principal payments, or both, on the underlying securities held","page_number":415,"box":{"x":117,"y":459,"width":766,"height":12}},{"id":"dacadbda-64c8-47f1-8246-13ffaa6f6e62","block_type":"box","text":"by the custodian. Under such arrangements, the holder of the custodial receipt has the option to tender","page_number":415,"box":{"x":117,"y":475,"width":769,"height":12}},{"id":"286c833e-0158-4b1c-8725-56ef43cf6bdc","block_type":"box","text":"the underlying securities at their face value to the sponsor (","page_number":415,"box":{"x":116,"y":490,"width":440,"height":12}},{"id":"c364d1ca-26f9-44c7-9900-371d3a46776f","block_type":"box","text":"e.g.","page_number":415,"box":{"x":557,"y":493,"width":26,"height":9}},{"id":"5003a7ab-7c63-4ff3-83af-e52bdab8fcbb","block_type":"box","text":", a Fund, or a bank or broker-dealer or","page_number":415,"box":{"x":586,"y":490,"width":289,"height":11}},{"id":"9bc117ef-2e3a-434a-ae10-eeb7829dbd28","block_type":"box","text":"other financial institution), which is paid periodic fees equal to the difference between the securities’","page_number":415,"box":{"x":116,"y":506,"width":743,"height":12}},{"id":"1d91935a-925c-42c8-bf02-ea026f594bd7","block_type":"box","text":"fixed coupon rate and the rate that would cause the securities, coupled with the tender option, to trade","page_number":415,"box":{"x":116,"y":521,"width":763,"height":12}},{"id":"4b9a29b0-3527-46c5-8c68-53a8d74f0523","block_type":"box","text":"at par on the date of a rate adjustment.","page_number":415,"box":{"x":116,"y":537,"width":295,"height":12}},{"id":"14fd6caa-d0d0-4e7b-bbe3-a33ba73a9624","block_type":"box","text":"A participation interest gives the Fund an undivided interest in a Municipal Bond in the proportion the","page_number":415,"box":{"x":116,"y":568,"width":752,"height":12}},{"id":"f37f39b9-509d-4992-973e-4b39d19fe6fa","block_type":"box","text":"Fund’s participation bears to the total principal amount of the Municipal Bond, and typically provides for","page_number":415,"box":{"x":117,"y":583,"width":769,"height":12}},{"id":"0caf2035-e2ca-4b95-b725-1a1e4b8ef462","block_type":"box","text":"a repurchase feature for all or any part of the full principal amount of the participation interest, plus","page_number":415,"box":{"x":116,"y":599,"width":735,"height":12}},{"id":"f547845a-d2a7-4a43-90d0-2e6f675f6e17","block_type":"box","text":"accrued interest. Trusts and partnerships are typically used to convert long-term fixed rate high quality","page_number":415,"box":{"x":116,"y":614,"width":763,"height":12}},{"id":"873779b5-810f-46b8-82d5-14122796998f","block_type":"box","text":"bonds of a single state or municipal issuer into variable or floating rate demand instruments.","page_number":415,"box":{"x":117,"y":630,"width":686,"height":12}},{"id":"61c85f8f-9dad-4101-b478-a9db7acd352a","block_type":"box","text":"The Municipal Bond Funds may hold participation intere","page_number":415,"box":{"x":116,"y":661,"width":397,"height":12}},{"id":"964e51f6-232c-44d4-8fc2-1c6f58f085f0","block_type":"box","text":"sts and custodial receipts for municipal debt","page_number":415,"box":{"x":513,"y":661,"width":311,"height":12}},{"id":"26a28de4-236f-429e-945b-7a863ed77db5","block_type":"box","text":"obligations which give the holder the right to receive","page_number":415,"box":{"x":116,"y":676,"width":368,"height":12}},{"id":"df2340ea-d891-4361-a017-14df73dc8a2a","block_type":"box","text":"payment of principal subject to the conditions described","page_number":415,"box":{"x":489,"y":676,"width":393,"height":12}},{"id":"5ce3cac4-4a19-47c4-b7d5-95291605588c","block_type":"box","text":"above. The IRS has not ruled on whether the interest re","page_number":415,"box":{"x":116,"y":692,"width":396,"height":9}},{"id":"3bf2280a-ed99-4716-ae3b-91e54fbbe171","block_type":"box","text":"ceived on tax-exempt municipal investments in the","page_number":415,"box":{"x":512,"y":692,"width":359,"height":12}},{"id":"8c1f2d59-d7d2-48ab-9548-02603e8561f2","block_type":"box","text":"form of participation interests or custodial receipts is","page_number":415,"box":{"x":116,"y":707,"width":368,"height":12}},{"id":"11b15f12-9598-45af-9f59-292fd90d9274","block_type":"box","text":"tax-exempt, and accordingly, purchases of any such","page_number":415,"box":{"x":489,"y":707,"width":371,"height":12}},{"id":"534d42f6-c65c-4462-b0ef-55e00c71b4a2","block_type":"box","text":"interests or receipts are based on the opinions of couns","page_number":415,"box":{"x":117,"y":723,"width":393,"height":12}},{"id":"cc7bb2e9-d505-44b9-b079-b8d48dd67c57","block_type":"box","text":"el to the sponsors of such derivative securities.","page_number":415,"box":{"x":511,"y":723,"width":331,"height":12}},{"id":"52c080fd-9bbb-4c99-b1da-2eae23cadc0e","block_type":"box","text":"Neither a Fund nor its investment adviser or sub-advis","page_number":415,"box":{"x":117,"y":738,"width":384,"height":10}},{"id":"a39e95ea-b153-4503-a000-ec27cea7268b","block_type":"box","text":"ers will review the proceedings related to the creation","page_number":415,"box":{"x":501,"y":738,"width":377,"height":12}},{"id":"f3b00ed3-12ab-426d-bef0-59719e9aec37","block_type":"box","text":"of any tax-exempt municipal investments or the basis for such opinions.","page_number":415,"box":{"x":116,"y":754,"width":507,"height":12}},{"id":"ceb7675f-9937-44dc-bd77-9881569fbfae","block_type":"box","text":"Operational and Technology Risks","page_number":415,"box":{"x":117,"y":785,"width":276,"height":12}},{"id":"2420b5c0-b697-4598-95b2-cb5ae418e67d","block_type":"box","text":". The Fund and the entities with which it interacts directly or","page_number":415,"box":{"x":394,"y":785,"width":440,"height":12}},{"id":"b097f89c-78c6-4352-ad40-c52026e367e6","block_type":"box","text":"indirectly are susceptible to operational and technology risks, including those related to human errors,","page_number":415,"box":{"x":117,"y":800,"width":752,"height":12}},{"id":"7e55cd88-bfd3-45e7-b5c3-9f7db2008721","block_type":"box","text":"processing errors, communication errors, systems failures, cybersecurity incidents, and the use of","page_number":415,"box":{"x":117,"y":816,"width":726,"height":12}},{"id":"62591614-d731-4446-b412-05579667b71d","block_type":"box","text":"artificial intelligence and machine learning (“AI”), which may result in losses for the Fund and its","page_number":415,"box":{"x":116,"y":831,"width":713,"height":12}},{"id":"0b5c46b1-0323-40c5-88fe-d8bd26cce183","block_type":"box","text":"shareholders or impair the Fund’s operations. These entities include, but are not limited to, the Fund’s","page_number":415,"box":{"x":116,"y":847,"width":760,"height":12}},{"id":"5534739b-765f-4fda-96f1-fe8c55bec452","block_type":"box","text":"adviser, administrator, distributor, other service providers (e.g., index and benchmark providers,","page_number":415,"box":{"x":116,"y":862,"width":716,"height":12}},{"id":"26a5218e-5f06-4c13-95c9-1a47083c633b","block_type":"box","text":"accountants, custodians, and transfer agents), financial intermediaries, counterparties, market makers,","page_number":415,"box":{"x":116,"y":878,"width":768,"height":12}},{"id":"9ba2a1a5-49ee-4810-ba63-0d63f34f32c5","block_type":"box","text":"II-83","page_number":415,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"26ae7678-07ed-494c-8840-b2b75830d40d","block_type":"box","text":"NM1026U-6004382-415/605","page_number":415,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9712c58c-8417-44d6-b61a-f54d49b09a37","block_type":"box","text":"Authorized Participants, listing exchanges, other financial market operators, and governmental","page_number":416,"box":{"x":116,"y":87,"width":706,"height":12}},{"id":"da1ff6e0-7b62-4ffb-b0b4-7fa39d306765","block_type":"box","text":"authorities, as applicable. Operational and technology risks for the issuers in which the Fund invests","page_number":416,"box":{"x":116,"y":102,"width":748,"height":13}},{"id":"41ecd5d5-58b2-4bd9-bb3e-60c402d8378b","block_type":"box","text":"could also result in material adverse consequences for such issuers and may cause the Fund’s","page_number":416,"box":{"x":116,"y":118,"width":711,"height":12}},{"id":"15e467db-e279-4cd3-ba46-f9172f279c70","block_type":"box","text":"investments in such issuers to lose value. The Fund may incur substantial costs in order to mitigate","page_number":416,"box":{"x":117,"y":134,"width":741,"height":12}},{"id":"5c42dc3d-03a6-465c-b411-60b164f20103","block_type":"box","text":"operational and technology risks.","page_number":416,"box":{"x":116,"y":149,"width":250,"height":12}},{"id":"ede737f4-9e9a-4708-9461-2766081cb54d","block_type":"box","text":"Cybersecurity incidents can result from deliberate attacks or unintentional events against an issuer in","page_number":416,"box":{"x":117,"y":180,"width":754,"height":12}},{"id":"0fb97b0e-79c1-41a9-a4d5-8a3aa1cabbb8","block_type":"box","text":"which the Fund invests, the Fund or any of its service providers. They include, but are not limited to,","page_number":416,"box":{"x":116,"y":196,"width":746,"height":12}},{"id":"1eed581d-2086-4b29-b50d-a4873b9b2801","block_type":"box","text":"gaining unauthorized access to systems, misappropriating assets or sensitive information, corrupting or","page_number":416,"box":{"x":116,"y":211,"width":772,"height":12}},{"id":"e3421ea6-a342-4086-8a08-91f7d77f71de","block_type":"box","text":"destroying data, and causing operational disruption. Geopolitical tension may increase the scale and","page_number":416,"box":{"x":116,"y":227,"width":751,"height":12}},{"id":"35bd7d1f-3bb6-4571-86ca-22a32b379586","block_type":"box","text":"sophistication of deliberate attacks, particularly those from nation states or from entities with nation","page_number":416,"box":{"x":116,"y":242,"width":738,"height":12}},{"id":"a5354381-2ba0-4dff-b278-a5822e337973","block_type":"box","text":"state backing. Cybersecurity incidents may result in any of the following: financial losses; interference","page_number":416,"box":{"x":116,"y":258,"width":757,"height":12}},{"id":"460c0715-1747-4589-b662-65ef79e5e741","block_type":"box","text":"with the Fund’s ability to calculate its NAV; disclosure of confidential information; impediments to","page_number":416,"box":{"x":116,"y":273,"width":721,"height":12}},{"id":"bed67a53-93d1-42ee-b574-0cc2b11f5032","block_type":"box","text":"trading; submission of erroneous trades by the Fund or erroneous subscription or redemption orders;","page_number":416,"box":{"x":116,"y":289,"width":754,"height":12}},{"id":"d119a8d6-47a5-4e74-a377-80f43f6e2961","block_type":"box","text":"the inability of the Fund or its service providers to transact business; violations of applicable privacy","page_number":416,"box":{"x":116,"y":304,"width":743,"height":12}},{"id":"66a65658-ee35-45a0-86b3-0ceaad962e64","block_type":"box","text":"and other laws; regulatory fines; penalties; reputational damage; reimbursement or other compensation","page_number":416,"box":{"x":116,"y":320,"width":772,"height":12}},{"id":"acba9e1c-e939-4938-83c0-ad9b9a179797","block_type":"box","text":"costs; and other legal and compliance expenses. 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AI technology advancements, including efficiency","page_number":416,"box":{"x":116,"y":506,"width":708,"height":12}},{"id":"cfc346f4-995e-49ba-a234-0490061d09b4","block_type":"box","text":"improvements, without related increases in the adoption and development of such technologies, could","page_number":416,"box":{"x":117,"y":521,"width":761,"height":12}},{"id":"8bfc0d6b-2620-4578-ba39-777829bfa40a","block_type":"box","text":"also negatively impact demand for, and the valuation of, digital infrastructure assets.","page_number":416,"box":{"x":116,"y":537,"width":630,"height":12}},{"id":"94dac05c-4d1b-4bb4-8edf-5fec99806c40","block_type":"box","text":"The Fund and its portfolio investments could be exposed to the risks of AI technology if third-party","page_number":416,"box":{"x":116,"y":568,"width":731,"height":12}},{"id":"c7578851-d58f-4f4d-ad7d-6e4cc2c3ccff","block_type":"box","text":"service providers or any counterparties, whether or not known to the Fund, also use AI technology in","page_number":416,"box":{"x":116,"y":583,"width":751,"height":12}},{"id":"4516f169-17e6-4782-a211-752e6aad018c","block_type":"box","text":"their business activities. The Fund and its service providers may not be in a position to control the use","page_number":416,"box":{"x":116,"y":599,"width":761,"height":12}},{"id":"dac26588-f3a2-4b3b-8ffa-b886799aad65","block_type":"box","text":"of AI technology in third-party products or services.","page_number":416,"box":{"x":116,"y":614,"width":383,"height":12}},{"id":"ecb08c15-80bf-4656-a0a4-52e599da342f","block_type":"box","text":"Use of AI technology could include the input of confidential information in contravention of applicable","page_number":416,"box":{"x":117,"y":645,"width":750,"height":12}},{"id":"cdd2de30-d508-4006-8869-45b58fa9bacf","block_type":"box","text":"policies, contractual or other obligations or restrictions, resulting in such confidential information","page_number":416,"box":{"x":117,"y":661,"width":708,"height":12}},{"id":"04b68525-92b5-4a44-9926-5148cd611f83","block_type":"box","text":"becoming accessible by other third-party AI technology applications and users.","page_number":416,"box":{"x":117,"y":676,"width":583,"height":12}},{"id":"44279ad4-ceba-4329-af06-2af587af7b67","block_type":"box","text":"Independent of its context of use, AI technology is generally highly reliant on the collection and","page_number":416,"box":{"x":117,"y":707,"width":700,"height":12}},{"id":"7bcbe3f3-46a9-4cd5-8e8c-26279b070484","block_type":"box","text":"analysis of large amounts of data, may incorporate biased or inaccurate data, and it is not possible or","page_number":416,"box":{"x":116,"y":723,"width":752,"height":12}},{"id":"9e3bc494-08a6-41db-808e-b582b0f2233d","block_type":"box","text":"practicable to incorporate all relevant data into the models that AI technology utilizes to operate.","page_number":416,"box":{"x":117,"y":738,"width":709,"height":12}},{"id":"6a400e59-b51f-4b73-abc7-2a8a7c95c3e4","block_type":"box","text":"Certain data in such models will inevitably contain a degree of inaccuracy and error, or could otherwise","page_number":416,"box":{"x":117,"y":754,"width":762,"height":12}},{"id":"088533da-e2af-44c7-bc12-67c45394ae37","block_type":"box","text":"be inadequate or flawed, which would be likely to degrade the effectiveness of AI technology. The","page_number":416,"box":{"x":117,"y":769,"width":724,"height":12}},{"id":"31d14f60-1f03-4b8c-a494-a0052d3cb2b2","block_type":"box","text":"output or results of any such AI technologies may therefore be incomplete, erroneous, distorted or","page_number":416,"box":{"x":116,"y":785,"width":728,"height":12}},{"id":"19dbae99-e922-4f8e-80ae-a7fba2e49144","block_type":"box","text":"misleading. Further, AI tools may lack transparency as to how data is utilized and how outputs are","page_number":416,"box":{"x":117,"y":800,"width":726,"height":12}},{"id":"0c203f8f-575d-439d-843f-e0de09f8a02e","block_type":"box","text":"generated. AI technologies may also allow the unintended introduction of vulnerabilities into","page_number":416,"box":{"x":116,"y":816,"width":679,"height":12}},{"id":"5668e0b6-f28a-4fc1-85b5-cb5d1777a330","block_type":"box","text":"infrastructures and applications. To the extent that the Fund or its portfolio investments are exposed to","page_number":416,"box":{"x":117,"y":831,"width":764,"height":12}},{"id":"e49378b8-37d5-48f1-9901-4cf8ec1e0f02","block_type":"box","text":"the risks of AI technology use, any such inaccuracies or errors could have adverse impacts on the","page_number":416,"box":{"x":116,"y":847,"width":732,"height":12}},{"id":"078598fc-f0e8-4618-a309-521d8134f45a","block_type":"box","text":"Fund or its investments.","page_number":416,"box":{"x":117,"y":862,"width":182,"height":10}},{"id":"66a66715-428f-4edb-a083-568c0fef5bca","block_type":"box","text":"II-84","page_number":416,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"75082c94-268c-43b4-89f3-9d6d326ba542","block_type":"box","text":"NM1026U-6004382-416/605","page_number":416,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b6cff1df-3627-43ce-9f43-aad928996412","block_type":"box","text":"Regulations related to AI technology could also impose certain obligations and costs related to","page_number":417,"box":{"x":117,"y":87,"width":705,"height":12}},{"id":"884033c7-71bf-44c9-8e25-b564b2f2a154","block_type":"box","text":"monitoring and compliance. 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In addition to the U.S. regulatory framework, in 2024, the EU adopted the Artificial Intelligence","page_number":417,"box":{"x":116,"y":180,"width":769,"height":12}},{"id":"87e28277-734c-48e1-b99f-66648d2c0529","block_type":"box","text":"Act, which applies to certain AI technology and the","page_number":417,"box":{"x":116,"y":196,"width":380,"height":12}},{"id":"b825f3f6-123b-4d2c-9e60-de0974f90456","block_type":"box","text":"data used to train, test, and deploy them, which","page_number":417,"box":{"x":497,"y":196,"width":357,"height":12}},{"id":"d0821e32-c285-4672-8297-a52cc91a03b2","block_type":"box","text":"may create additional compliance burdens, higher administrative costs, and significant penalties should","page_number":417,"box":{"x":117,"y":211,"width":770,"height":12}},{"id":"9a572ddb-8762-4fe6-a3a2-4661aa060a0d","block_type":"box","text":"the Fund, the adviser, or the Fund’s portfolio investments fail to comply.","page_number":417,"box":{"x":116,"y":227,"width":537,"height":12}},{"id":"e06e8f67-ba89-4354-bcd6-63a8cb5c951b","block_type":"box","text":"AI technology and its applications, including in the investment and financial sectors, continue to","page_number":417,"box":{"x":116,"y":258,"width":711,"height":12}},{"id":"a98ae2b8-34d3-4ce9-bc91-9a17fca7e832","block_type":"box","text":"develop rapidly, and it is impossible to predict the future risks that may arise from such developments.","page_number":417,"box":{"x":116,"y":273,"width":762,"height":12}},{"id":"6ed72cf0-fb4c-406e-a6bc-9e4d89934d12","block_type":"box","text":"The full extent of current or future risks related thereto is not possible to predict, and the Fund may not","page_number":417,"box":{"x":116,"y":289,"width":765,"height":12}},{"id":"1b44188a-0020-40ef-a110-eaf08d5ab653","block_type":"box","text":"be able to anticipate, prevent, mitigate, or remediate all of the potential risks, challenges, or impacts of","page_number":417,"box":{"x":117,"y":304,"width":763,"height":12}},{"id":"7b3a05fa-77f9-4cb5-b018-1470ad3729d6","block_type":"box","text":"such changes.","page_number":417,"box":{"x":116,"y":320,"width":113,"height":12}},{"id":"9df6530c-c191-4ac8-af47-dbb283f364b3","block_type":"box","text":"While the Fund’s service providers are required to have appropriate operational, information security","page_number":417,"box":{"x":116,"y":351,"width":750,"height":12}},{"id":"1056ed11-0290-4722-b04f-5a6cb7cc4b0c","block_type":"box","text":"and cybersecurity risk management policies and procedures, their methods of risk management may","page_number":417,"box":{"x":116,"y":366,"width":753,"height":12}},{"id":"0a1a4476-d38b-4966-b008-57d030ca97ab","block_type":"box","text":"differ from those of the Fund in the setting of priorities, the personnel and resources available or the","page_number":417,"box":{"x":116,"y":382,"width":745,"height":12}},{"id":"d8e50f28-0afa-4069-a645-6a1e2081edea","block_type":"box","text":"effectiveness of relevant controls. The Fund and its adviser seek to reduce these risks through","page_number":417,"box":{"x":116,"y":397,"width":706,"height":12}},{"id":"4d74ae4a-b110-4d2a-8724-5325fb8e8186","block_type":"box","text":"controls, procedures and oversight, including establishing business continuity plans and risk","page_number":417,"box":{"x":116,"y":413,"width":687,"height":12}},{"id":"ce7832ae-3d7a-42e4-a6a3-850a66df42a3","block_type":"box","text":"management systems. 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Regulators continue to develop new rules and standards","page_number":417,"box":{"x":117,"y":568,"width":747,"height":12}},{"id":"d5b242b3-3c4f-4611-91c3-c0b6afc17a09","block_type":"box","text":"related to cybersecurity and data protection. 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A Fund’s ability to","page_number":418,"box":{"x":116,"y":165,"width":373,"height":12}},{"id":"5aded1d0-62a1-40fe-8cc6-7c31a0250739","block_type":"box","text":"redeem or exercise a participation note generally is","page_number":418,"box":{"x":490,"y":165,"width":366,"height":12}},{"id":"5fbe9c23-2c43-4d4b-b52d-5e74a38771b2","block_type":"box","text":"dependent on the liquidity in the local trading market f","page_number":418,"box":{"x":116,"y":180,"width":375,"height":12}},{"id":"e71f3189-e890-478e-b362-42a9156c1f46","block_type":"box","text":"for the security underlying the participation note.","page_number":418,"box":{"x":491,"y":180,"width":346,"height":12}},{"id":"c1736c42-b347-4ba6-8364-98029b1edf2a","block_type":"box","text":"Portfolio Turnover Rates.","page_number":418,"box":{"x":116,"y":211,"width":193,"height":10}},{"id":"27a416c6-2ace-4330-a074-39877c47fda9","block_type":"box","text":"A Fund’s annual portfolio turnover rate will not be a factor preventing a sale or","page_number":418,"box":{"x":309,"y":211,"width":562,"height":12}},{"id":"574a78e5-c9f6-4d95-a39d-f136c318c14a","block_type":"box","text":"purchase when the Manager believes investment consi","page_number":418,"box":{"x":117,"y":227,"width":390,"height":12}},{"id":"7747f2c6-8aba-4737-92e0-7878aba8a9d3","block_type":"box","text":"derations warrant such sale or purchase. Although","page_number":418,"box":{"x":509,"y":227,"width":363,"height":12}},{"id":"a804233d-be54-4fba-bf18-1d05e277df4d","block_type":"box","text":"certain Funds will use an approach to investing that is largely a passive, indexing approach, such Funds","page_number":418,"box":{"x":116,"y":242,"width":742,"height":12}},{"id":"884c5f28-8d8c-4ebc-b3a0-b3cd3f362729","block_type":"box","text":"may engage in a substantial number of portfolio transactions. 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Portfolio turnover may vary greatly from y","page_number":418,"box":{"x":116,"y":304,"width":397,"height":12}},{"id":"ed3841a2-65a2-4e35-bef4-a61308a3c769","block_type":"box","text":"ear to year as well as within a particular year. High","page_number":418,"box":{"x":514,"y":304,"width":362,"height":12}},{"id":"d859a3b9-695f-48c5-b8b0-c1151d3ea676","block_type":"box","text":"portfolio turnover (","page_number":418,"box":{"x":117,"y":320,"width":128,"height":12}},{"id":"85b55f67-185d-4294-a6bf-b04ce5929084","block_type":"box","text":"i.e.","page_number":418,"box":{"x":246,"y":320,"width":19,"height":9}},{"id":"0c813445-9a59-45fb-92f9-0aeeaa2e6d87","block_type":"box","text":", 100% or more) may result in increased transaction costs to a Fund, including","page_number":418,"box":{"x":268,"y":320,"width":559,"height":12}},{"id":"a19743b9-3bc7-488c-8bed-d5410b7b37cf","block_type":"box","text":"brokerage commissions, dealer mark-ups and other trans","page_number":418,"box":{"x":117,"y":335,"width":407,"height":12}},{"id":"d2cc7591-6727-4248-afd2-df967134f740","block_type":"box","text":"action costs on the sale of the securities and","page_number":418,"box":{"x":525,"y":335,"width":320,"height":10}},{"id":"7a75f156-b97a-4c6b-a33a-85bd12c6b812","block_type":"box","text":"reinvestment in other securities. The sale of a Fund’s se","page_number":418,"box":{"x":117,"y":351,"width":397,"height":9}},{"id":"af3ee29b-42fe-44e4-83f0-0bf1dce8a4cb","block_type":"box","text":"curities may result in the recognition of capital gain","page_number":418,"box":{"x":514,"y":351,"width":363,"height":12}},{"id":"0958bc27-3ef7-45a1-b92d-fc1b14bb28f0","block_type":"box","text":"or loss. Given the frequency of sales, such gain or","page_number":418,"box":{"x":116,"y":366,"width":357,"height":12}},{"id":"4742c6e8-333a-4ca2-a53f-e7a645f3ea3a","block_type":"box","text":"r loss will likely be short-term capital gain or loss. These","page_number":418,"box":{"x":472,"y":366,"width":395,"height":12}},{"id":"7ad4b6bd-7039-4e0b-8896-06dad28d7395","block_type":"box","text":"effects of higher than normal portfolio turnover may adversely affect a Fund’s performance.","page_number":418,"box":{"x":116,"y":382,"width":651,"height":12}},{"id":"97a590fd-5864-4e8b-9915-b0ca81f03bb1","block_type":"box","text":"Preferred Stock.","page_number":418,"box":{"x":116,"y":413,"width":123,"height":9}},{"id":"d71d50fd-a818-4b2e-af26-fb1667525335","block_type":"box","text":"Certain Funds may invest in preferred sto","page_number":418,"box":{"x":240,"y":413,"width":300,"height":12}},{"id":"640a2265-1ef3-4eed-9dd7-8382ac69fd7e","block_type":"box","text":"cks. Preferred stock has a preference over","page_number":418,"box":{"x":540,"y":413,"width":308,"height":12}},{"id":"d1fe4e05-6fd7-4d8a-8de0-978069bb734d","block_type":"box","text":"common stock in liquidation (and generally dividends","page_number":418,"box":{"x":116,"y":428,"width":381,"height":12}},{"id":"2bed7960-693b-49c2-918d-fec1de843b03","block_type":"box","text":"as well) but is subordinated to the bond holders and","page_number":418,"box":{"x":497,"y":428,"width":372,"height":12}},{"id":"9a128c9f-22e3-41ad-a6bd-a651b29e01ce","block_type":"box","text":"other creditors in all respects. As a general rule, t","page_number":418,"box":{"x":116,"y":444,"width":348,"height":12}},{"id":"65e04d1d-6d2d-4bb7-a396-4bea55823ef4","block_type":"box","text":"he market value of preferred stock with a fixed dividend","page_number":418,"box":{"x":465,"y":444,"width":396,"height":12}},{"id":"b1e437ec-5a4f-4089-9286-c4364db850a7","block_type":"box","text":"rate and no conversion element varies inversely with","page_number":418,"box":{"x":117,"y":459,"width":377,"height":12}},{"id":"82f0b7c8-8741-450d-abdf-0ad1374f93ac","block_type":"box","text":"interest rates and perceived credit risk, while the","page_number":418,"box":{"x":495,"y":459,"width":346,"height":12}},{"id":"92ebac78-f46a-437b-b8fa-afeae1be1925","block_type":"box","text":"market price of convertible preferred stock generally","page_number":418,"box":{"x":117,"y":475,"width":373,"height":12}},{"id":"4e3eda97-2540-4e79-8c9b-890e5ec9415a","block_type":"box","text":"also reflects some element of conversion value.","page_number":418,"box":{"x":490,"y":475,"width":343,"height":9}},{"id":"7d387f41-bd8a-4e90-b4f9-c0bfab4207f4","block_type":"box","text":"Because preferred stock is junior to debt securities","page_number":418,"box":{"x":117,"y":490,"width":363,"height":12}},{"id":"feac60b5-9bb1-4b14-ac2b-06313f1ad0a4","block_type":"box","text":"and other obligations of the issuer, deterioration in the","page_number":418,"box":{"x":480,"y":490,"width":387,"height":12}},{"id":"8508e52b-8a59-431c-a346-be0eb6fbf9c2","block_type":"box","text":"credit quality of the issuer will cause greater changes in t","page_number":418,"box":{"x":116,"y":506,"width":402,"height":12}},{"id":"bf2c59eb-6b19-4a3f-9bb6-c4a4adebdb25","block_type":"box","text":"he value of a preferred stock than in a more senior","page_number":418,"box":{"x":519,"y":506,"width":362,"height":12}},{"id":"4a33cfa5-d7cf-42d9-ad3f-5dc8b3437d1b","block_type":"box","text":"debt security with similar stated yield characteristics.","page_number":418,"box":{"x":116,"y":521,"width":370,"height":12}},{"id":"e813a99e-8dd1-43c9-a198-353a75c35619","block_type":"box","text":"Unlike interest payments on debt securities, preferred","page_number":418,"box":{"x":487,"y":521,"width":390,"height":12}},{"id":"d32cefb2-aeeb-4220-a56a-28cf68ef82a4","block_type":"box","text":"stock dividends are payable only if declared by the issuer","page_number":418,"box":{"x":116,"y":537,"width":406,"height":12}},{"id":"8fe5551d-01b5-4d11-ae2c-76404046ef17","block_type":"box","text":"’s board of directors. Preferred stock also may be","page_number":418,"box":{"x":523,"y":537,"width":354,"height":12}},{"id":"b93beabb-977c-41dd-ba3d-53ac29a9409e","block_type":"box","text":"subject to optional or mandatory redemption provisions.","page_number":418,"box":{"x":116,"y":552,"width":400,"height":12}},{"id":"b46bc465-ebcb-48f3-99b6-2f8ed9369225","block_type":"box","text":"Tax-Exempt Preferred Shares.","page_number":418,"box":{"x":118,"y":583,"width":224,"height":12}},{"id":"9a4246c2-04e7-4bff-aee9-014ab73331cc","block_type":"box","text":"Certain Funds may invest in preferred interests of other investment","page_number":418,"box":{"x":344,"y":583,"width":507,"height":12}},{"id":"52cab5e5-ba00-40aa-8ffa-0f41dc3dbd16","block_type":"box","text":"funds that pay dividends that are exempt from regular U.S. federal income tax. Such funds in turn","page_number":418,"box":{"x":116,"y":599,"width":728,"height":12}},{"id":"56b805a1-189a-4619-b70f-d41ddd78a8b8","block_type":"box","text":"invest in municipal bonds and other assets that pay interest or make distributions that are exempt from","page_number":418,"box":{"x":117,"y":614,"width":765,"height":12}},{"id":"aec60160-4590-49e8-8711-ce0555ba156c","block_type":"box","text":"regular U.S. federal income tax, such as revenue bonds issued by state or local agencies to fund the","page_number":418,"box":{"x":117,"y":630,"width":751,"height":12}},{"id":"08a5bd16-56d4-42a1-9aec-52e7d3700a59","block_type":"box","text":"development of low-income, multi-family housing. Investment in such tax-exempt preferred shares","page_number":418,"box":{"x":116,"y":645,"width":733,"height":12}},{"id":"dfe9a60f-2888-448c-8e82-f4c76e73b36b","block_type":"box","text":"involves many of the same issues as investing in other investment companies. These investments also","page_number":418,"box":{"x":117,"y":661,"width":763,"height":12}},{"id":"6518ccc6-15c7-4814-9c1a-2db9eedd68a4","block_type":"box","text":"have additional risks, including illiquid investments risk, the absence of regulation governing","page_number":418,"box":{"x":117,"y":676,"width":679,"height":12}},{"id":"8fd7ad94-25d2-47a9-9b1d-5b95af2cd2a9","block_type":"box","text":"investment practices, capital structure and leverage, affiliated transactions and other matters, and","page_number":418,"box":{"x":117,"y":692,"width":723,"height":12}},{"id":"51b0f212-c881-4e1a-933b-8f1fa789e617","block_type":"box","text":"concentration of investments in particular issuers or industries. The Municipal Bond Funds will treat","page_number":418,"box":{"x":116,"y":707,"width":736,"height":12}},{"id":"0eff09c7-27d5-4138-89c9-588118101683","block_type":"box","text":"investments in tax-exempt preferred shares as investments in municipal bonds.","page_number":418,"box":{"x":117,"y":723,"width":587,"height":12}},{"id":"2bca4532-19b7-4db5-8dd9-3c93497d8a64","block_type":"box","text":"Trust Preferred Securities.","page_number":418,"box":{"x":118,"y":754,"width":193,"height":9}},{"id":"633a519c-f69a-4c41-a532-422e0065995f","block_type":"box","text":"Certain Funds may invest in trust preferred securities. Trust preferred","page_number":418,"box":{"x":318,"y":754,"width":514,"height":12}},{"id":"d708cc1d-6166-4702-9921-1e5f9267e1f9","block_type":"box","text":"securities are typically issued by corporations, generally in the form of interest bearing notes with","page_number":418,"box":{"x":116,"y":769,"width":718,"height":12}},{"id":"f60b0147-2f82-4db4-8fd7-33b0939f6d5a","block_type":"box","text":"preferred securities characteristics, or by an affiliated business trust of a corporation, generally in the","page_number":418,"box":{"x":117,"y":785,"width":746,"height":12}},{"id":"d3eae3cf-6ff2-4b4d-a855-cfdfb128c784","block_type":"box","text":"form of beneficial interests in subordinated debentures or similarly structured securities. The trust","page_number":418,"box":{"x":116,"y":800,"width":721,"height":12}},{"id":"000e6ba3-083c-4540-8dd8-824d22940421","block_type":"box","text":"preferred securities market consists of both fixed and adjustable coupon rate securities that are either","page_number":418,"box":{"x":117,"y":816,"width":753,"height":12}},{"id":"cbc303f4-01ff-4f93-9c1a-63f101be9dbe","block_type":"box","text":"perpetual in nature or have stated maturity dates.","page_number":418,"box":{"x":117,"y":831,"width":370,"height":12}},{"id":"8bf71a30-f2a6-4316-b4a3-be4f0f54e3c9","block_type":"box","text":"Trust preferred securities are typically junior and fully subordinated liabilities of an issuer and benefit","page_number":418,"box":{"x":116,"y":862,"width":748,"height":12}},{"id":"21872c11-c1d0-4269-bc40-de0537175ea1","block_type":"box","text":"from a guarantee that is junior and fully subordinated to the other liabilities of the guarantor. 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Because of their subordinated position in the capital","page_number":419,"box":{"x":117,"y":102,"width":713,"height":13}},{"id":"e6bd6d7e-8a77-4db5-874b-ab5e22550d7b","block_type":"box","text":"structure of an issuer, the ability to defer payments for extended periods of time without default","page_number":419,"box":{"x":116,"y":118,"width":708,"height":12}},{"id":"491e879b-d1fd-40e7-b957-e0c50de9cb61","block_type":"box","text":"consequences to the issuer, and certain other features (such as restrictions on common dividend","page_number":419,"box":{"x":116,"y":134,"width":725,"height":12}},{"id":"843cd521-5e15-4082-a8ce-19d3a7182729","block_type":"box","text":"payments by the issuer or ultimate guarantor when full cumulative payments on the trust preferred","page_number":419,"box":{"x":117,"y":149,"width":733,"height":12}},{"id":"cc0974df-bde5-4311-8b41-be8e456b3ed7","block_type":"box","text":"securities have not been made), these trust preferred securities are often treated as close substitutes","page_number":419,"box":{"x":116,"y":165,"width":756,"height":12}},{"id":"1203a888-2fb7-4cc5-abc1-0b8e72a02fe3","block_type":"box","text":"for traditional preferred securities, both by issuers and investors.","page_number":419,"box":{"x":116,"y":180,"width":483,"height":12}},{"id":"b67e5223-578a-4d1a-b0a5-7569f20ae012","block_type":"box","text":"Trust preferred securities include but are not limited to trust originated preferred securities (“TOPRS","page_number":419,"box":{"x":116,"y":211,"width":740,"height":12}},{"id":"4ed63920-a184-4d7b-b8f8-e16bb8d66ccc","block_type":"box","text":"®","page_number":419,"box":{"x":857,"y":210,"width":9,"height":7}},{"id":"d6efe281-312b-4ce0-80dc-326a15eb5881","block_type":"box","text":"”);","page_number":419,"box":{"x":867,"y":211,"width":20,"height":12}},{"id":"e49a7674-61b9-4e04-90db-452c837307e5","block_type":"box","text":"monthly income preferred securities (“MIPS","page_number":419,"box":{"x":117,"y":227,"width":322,"height":12}},{"id":"0daabfcf-7c34-42ae-a671-232b66c6310d","block_type":"box","text":"®","page_number":419,"box":{"x":439,"y":226,"width":10,"height":7}},{"id":"ef73815d-7237-440a-a0bf-c2af5e55d3a8","block_type":"box","text":"”); quarterly income bond securities (“QUIBS","page_number":419,"box":{"x":449,"y":227,"width":330,"height":12}},{"id":"dbbc08c0-9e0f-458c-835b-c69d9a6103ac","block_type":"box","text":"®","page_number":419,"box":{"x":780,"y":226,"width":9,"height":7}},{"id":"ef9dec4e-18ff-4ba3-8f83-358c9e0a319f","block_type":"box","text":"” ); quarterly","page_number":419,"box":{"x":790,"y":227,"width":95,"height":12}},{"id":"e9ced3a9-6227-4cae-8c21-2810debb538c","block_type":"box","text":"income debt securities (“QUIDS","page_number":419,"box":{"x":117,"y":242,"width":234,"height":12}},{"id":"d050d4bd-69d4-4a2e-9396-6e1f2bdaf24d","block_type":"box","text":"®","page_number":419,"box":{"x":352,"y":241,"width":10,"height":7}},{"id":"5b8837ed-b77c-4aad-92b4-7988eb0803e6","block_type":"box","text":"”); quarterly income preferred securities (“QUIPS","page_number":419,"box":{"x":362,"y":242,"width":361,"height":12}},{"id":"d436d2cd-ef59-4059-87c3-5002d242036a","block_type":"box","text":"SM","page_number":419,"box":{"x":724,"y":242,"width":16,"height":6}},{"id":"5212cce7-a817-4f72-97c4-805aa3e462df","block_type":"box","text":"”); corporate trust","page_number":419,"box":{"x":741,"y":242,"width":133,"height":12}},{"id":"9487523f-d0d2-4ff0-a7e6-f34f468f2826","block_type":"box","text":"securities (“CORTS","page_number":419,"box":{"x":116,"y":258,"width":145,"height":12}},{"id":"61bbc89f-84fd-4dff-b907-8bd2c65f00b7","block_type":"box","text":"®","page_number":419,"box":{"x":262,"y":257,"width":9,"height":7}},{"id":"dee6465e-80bb-480c-9d40-6b017ad7fe72","block_type":"box","text":"”); public income notes (“PINES","page_number":419,"box":{"x":271,"y":258,"width":235,"height":12}},{"id":"1a0bd4a4-7ac2-4afc-86e9-fc94d5f3fb4d","block_type":"box","text":"®","page_number":419,"box":{"x":507,"y":257,"width":9,"height":7}},{"id":"061c47cd-83cc-44d7-ab7c-26dd56657248","block_type":"box","text":"”); and other trust preferred securities.","page_number":419,"box":{"x":517,"y":258,"width":287,"height":12}},{"id":"d34b6105-7a8e-4cdc-a7f7-e05f44a42044","block_type":"box","text":"Trust preferred securities are typically issued with a final maturity date, although some are perpetual in","page_number":419,"box":{"x":116,"y":289,"width":766,"height":12}},{"id":"83542352-52ea-465e-8977-1debc3bbd087","block_type":"box","text":"nature. In certain instances, a final maturity date may be extended and/or the final payment of principal","page_number":419,"box":{"x":117,"y":304,"width":767,"height":12}},{"id":"035bf6c5-3aa6-491f-96b6-39a895eec99a","block_type":"box","text":"may be deferred at the issuer’s option for a specified time without default. No redemption can typically","page_number":419,"box":{"x":117,"y":320,"width":760,"height":12}},{"id":"d6eaad31-57ac-4b7f-a22f-e219b2590ce7","block_type":"box","text":"take place unless all cumulative payment obligations have been met, although issuers may be able to","page_number":419,"box":{"x":116,"y":335,"width":758,"height":12}},{"id":"c1ed6ec2-266b-4834-bd44-aa2db24a8875","block_type":"box","text":"engage in open-market repurchases without regard to whether all payments have been paid.","page_number":419,"box":{"x":116,"y":351,"width":693,"height":12}},{"id":"39bb9a63-6ac9-4b03-b687-32003896c9cb","block_type":"box","text":"Many trust preferred securities are issued by trusts or other special purpose entities established by","page_number":419,"box":{"x":117,"y":382,"width":737,"height":12}},{"id":"f44dea69-7ba1-4aab-8e16-78558c5c5871","block_type":"box","text":"operating companies and are not a direct obligation of an operating company. At the time the trust or","page_number":419,"box":{"x":116,"y":397,"width":752,"height":12}},{"id":"520a00da-f234-4129-b789-6bcde4eff985","block_type":"box","text":"special purpose entity sells such preferred securities to investors, it purchases debt of the operating","page_number":419,"box":{"x":116,"y":413,"width":745,"height":12}},{"id":"481cd723-5e5e-4b09-8ff2-8ee3b6e69393","block_type":"box","text":"company (with terms comparable to those of the trust or special purpose entity securities), which","page_number":419,"box":{"x":116,"y":428,"width":722,"height":12}},{"id":"24af91d5-e506-4b7c-8ce4-8508881fd3f7","block_type":"box","text":"enables the operating company to deduct for tax purposes the interest paid on the debt held by the","page_number":419,"box":{"x":116,"y":444,"width":739,"height":12}},{"id":"8c6f8ccc-b485-4f05-a685-1ee27b497550","block_type":"box","text":"trust or special purpose entity. The trust or special purpose entity is generally required to be treated as","page_number":419,"box":{"x":116,"y":459,"width":765,"height":12}},{"id":"fa983b94-b6e1-491b-aef7-6271bb4e565a","block_type":"box","text":"transparent for U.S. federal income tax purposes such that the holders of the trust preferred securities","page_number":419,"box":{"x":116,"y":475,"width":762,"height":12}},{"id":"6b627d95-b1a6-4371-ab0a-7309498d0526","block_type":"box","text":"are treated as owning beneficial interests in the underlying debt of the operating company. Accordingly,","page_number":419,"box":{"x":116,"y":490,"width":772,"height":12}},{"id":"70800f0e-a9aa-4bac-a97f-e6b0c2c36aad","block_type":"box","text":"payments on the trust preferred securities are treated as interest rather than dividends for U.S. federal","page_number":419,"box":{"x":117,"y":506,"width":763,"height":12}},{"id":"bd705bfb-a19f-4ad7-b30c-fc4947c2936f","block_type":"box","text":"income tax purposes. The trust or special purpose entity in turn would be a holder of the operating","page_number":419,"box":{"x":117,"y":521,"width":732,"height":12}},{"id":"f6dab646-dff9-4063-aed3-a154b209c18e","block_type":"box","text":"company’s debt and would have priority with respect to the operating company’s earnings and profits","page_number":419,"box":{"x":116,"y":537,"width":754,"height":12}},{"id":"530c7bc9-7443-4064-a1a2-60f5e38e0195","block_type":"box","text":"over the operating company’s common shareholders, but would typically be subordinated to other","page_number":419,"box":{"x":116,"y":552,"width":729,"height":12}},{"id":"958f691a-51eb-40d6-a7bc-eb70d3173381","block_type":"box","text":"classes of the operating company’s debt. Typically a preferred share has a rating that is slightly below","page_number":419,"box":{"x":116,"y":568,"width":760,"height":12}},{"id":"17246ec0-b1fd-4de2-be49-92b922292dea","block_type":"box","text":"that of its corresponding operating company’s senior debt securities.","page_number":419,"box":{"x":116,"y":583,"width":512,"height":12}},{"id":"4dc295bd-4570-4e77-a25d-2bcb58ac221a","block_type":"box","text":"Real Estate Investment Trusts (“REITs”).","page_number":419,"box":{"x":116,"y":614,"width":324,"height":12}},{"id":"bab4bd59-a80d-4dad-8c2f-75ecc785531e","block_type":"box","text":"In pursuing its investment strategy, a Fund may invest in","page_number":419,"box":{"x":441,"y":614,"width":430,"height":12}},{"id":"52e5e366-747f-439a-833c-a5f7cd2db662","block_type":"box","text":"shares of REITs. REITs possess certain risks which differ from an investment in common stocks.","page_number":419,"box":{"x":116,"y":630,"width":724,"height":12}},{"id":"76f58366-c92e-4224-823b-c33e2c95597f","block_type":"box","text":"REITs are financial vehicles that pool investor’s capital to purchase or finance real estate. REITs may","page_number":419,"box":{"x":117,"y":645,"width":756,"height":12}},{"id":"8426aabe-2f27-47db-9b76-646cd1b865c1","block_type":"box","text":"concentrate their investments in specific geographic areas or in specific property types,","page_number":419,"box":{"x":116,"y":661,"width":646,"height":12}},{"id":"99784068-2b80-4ba7-abbc-6f42c115c676","block_type":"box","text":"i.e.","page_number":419,"box":{"x":768,"y":661,"width":21,"height":9}},{"id":"01727593-058c-46d7-9cba-0b44bf477fef","block_type":"box","text":", hotels,","page_number":419,"box":{"x":792,"y":661,"width":56,"height":11}},{"id":"113d78e9-0530-4446-9755-aa1217cb6a96","block_type":"box","text":"shopping malls, residential complexes and office buildings.","page_number":419,"box":{"x":116,"y":676,"width":435,"height":12}},{"id":"cbdaeb62-c36d-4a83-afff-294642e435b7","block_type":"box","text":"REITs are subject to management fees and other expenses, and so a Fund that invests in REITs will","page_number":419,"box":{"x":117,"y":707,"width":746,"height":12}},{"id":"de95eb9c-5238-4504-bff8-040a943a998a","block_type":"box","text":"bear its proportionate share of the costs of the REITs’ operations. There are three general categories","page_number":419,"box":{"x":117,"y":723,"width":749,"height":12}},{"id":"e666110a-d38b-4031-8bfd-681a784d10c3","block_type":"box","text":"of REITs: Equity REITs, Mortgage REITs and Hybrid REITs. Equity REITs invest primarily in direct fee","page_number":419,"box":{"x":116,"y":738,"width":758,"height":12}},{"id":"f487468d-688c-46a1-aee3-de97e3a86d8e","block_type":"box","text":"ownership or leasehold ownership of real property, which derive most of their income from rents.","page_number":419,"box":{"x":116,"y":754,"width":715,"height":12}},{"id":"c65a2f7e-5a0d-4735-b3ee-526dd361357e","block_type":"box","text":"Mortgage REITs invest mostly in mortgages on real estate, which may secure construction,","page_number":419,"box":{"x":117,"y":769,"width":675,"height":12}},{"id":"00b58497-357a-46b4-8b72-0ccd7d16c2a5","block_type":"box","text":"development or long-term loans; the main source of their income is mortgage interest payments.","page_number":419,"box":{"x":116,"y":785,"width":714,"height":12}},{"id":"b04f2e29-5a20-4d38-b883-18913788b049","block_type":"box","text":"Hybrid REITs hold both ownership and mortgage interests in real estate.","page_number":419,"box":{"x":117,"y":800,"width":535,"height":12}},{"id":"195a0be3-4c1a-474a-9fad-ce3b81b6a916","block_type":"box","text":"Investing in REITs involves certain unique risks in addition to those risks associated with investing in","page_number":419,"box":{"x":117,"y":831,"width":749,"height":12}},{"id":"dfa28307-52ea-4476-963c-0c9913351f60","block_type":"box","text":"the real estate industry in general. The market value of REIT shares and the ability of the REITs to","page_number":419,"box":{"x":116,"y":847,"width":735,"height":12}},{"id":"a494c2d2-fa43-4796-a827-45eecd2c5206","block_type":"box","text":"distribute income may be adversely affected by several factors, including rising interest rates, changes","page_number":419,"box":{"x":116,"y":862,"width":765,"height":12}},{"id":"5fa40cc7-712c-48a9-92ed-8299b6d0f850","block_type":"box","text":"in the national, state and local economic climate and real estate conditions, occupancy and rental","page_number":419,"box":{"x":117,"y":878,"width":727,"height":12}},{"id":"0e223377-09eb-4485-bd4a-7211e343f1e9","block_type":"box","text":"II-87","page_number":419,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"8ada3ad7-dbed-4529-bb80-a67acc2f206d","block_type":"box","text":"NM1026U-6004382-419/605","page_number":419,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4c7721c0-d82a-4913-968f-0fc01571f280","block_type":"box","text":"rales, perceptions of prospective tenants of the safety, convenience and attractiveness of the","page_number":420,"box":{"x":117,"y":87,"width":694,"height":12}},{"id":"d754ddde-912b-4972-87b1-8a1a705528a7","block_type":"box","text":"properties, the ability of the owners to provide adequate management, maintenance and insurance, the","page_number":420,"box":{"x":117,"y":102,"width":770,"height":13}},{"id":"90c6b69c-3e4d-42d1-96b7-59d6e6440ad3","block_type":"box","text":"cost of complying with the Americans with Disabilities Act, increased competition from new properties,","page_number":420,"box":{"x":116,"y":118,"width":761,"height":12}},{"id":"48bc96ff-011e-4ec9-a865-43d2fde9e4a6","block_type":"box","text":"the impact of present or future environmental legislation and compliance with environmental laws,","page_number":420,"box":{"x":116,"y":134,"width":729,"height":12}},{"id":"f9852718-1f86-431c-bb7b-162d87c02843","block_type":"box","text":"failing to maintain their exemptions from registration under the Investment Company Act, changes in","page_number":420,"box":{"x":116,"y":149,"width":749,"height":12}},{"id":"d403ed63-6008-49e6-ab13-dd0976cda668","block_type":"box","text":"real estate taxes and other operating expenses, adverse changes in governmental rules and fiscal","page_number":420,"box":{"x":117,"y":165,"width":733,"height":12}},{"id":"cbfac268-78ba-4ea9-98eb-aba7cfefc38d","block_type":"box","text":"policies, adverse changes in zoning laws and other factors beyond the control of the issuers of the","page_number":420,"box":{"x":117,"y":180,"width":733,"height":12}},{"id":"83ca00f4-6985-4643-9489-d951f80fe7a0","block_type":"box","text":"REITs. To the extent that assets underlying a REIT are concentrated geographically, by property type,","page_number":420,"box":{"x":117,"y":196,"width":762,"height":12}},{"id":"ed447580-c37b-4210-b8bb-dda38ee38a2d","block_type":"box","text":"or in certain other respects, these risks may be heightened.","page_number":420,"box":{"x":116,"y":211,"width":446,"height":12}},{"id":"f45445f1-9f1d-4207-a7cc-a54d50da2994","block_type":"box","text":"In addition, distributions received by a Fund from REITs may consist of dividends, capital gains and/or","page_number":420,"box":{"x":117,"y":242,"width":761,"height":12}},{"id":"731a70b3-644f-4772-9193-147d18b5b00e","block_type":"box","text":"return of capital. As REITs generally pay a higher rate of dividends (on a pre-tax basis) than operating","page_number":420,"box":{"x":117,"y":258,"width":760,"height":12}},{"id":"81a86a00-08d6-4cb7-ae83-ddb4b96b880a","block_type":"box","text":"companies, to the extent application of the Fund’s investment strategy results in the Fund investing in","page_number":420,"box":{"x":116,"y":273,"width":758,"height":12}},{"id":"6b3971a0-23f5-4e05-a82d-dedbd11d3882","block_type":"box","text":"REIT shares, the percentage of the Fund’s dividend income received from REIT shares will likely","page_number":420,"box":{"x":117,"y":289,"width":722,"height":12}},{"id":"fc4cdcd0-39bc-46fb-9337-e8d1fe261383","block_type":"box","text":"exceed the percentage of the Fund’s portfolio which is comprised of REIT shares. Ordinary REIT","page_number":420,"box":{"x":116,"y":304,"width":723,"height":12}},{"id":"01336c51-b5e6-4252-9bef-69128d3e44d8","block_type":"box","text":"dividends received by the Fund and distributed to the Fund’s shareholders will generally be taxable as","page_number":420,"box":{"x":116,"y":320,"width":762,"height":12}},{"id":"fbb827fc-1935-4687-b09a-cbfa9123901e","block_type":"box","text":"ordinary income and will not constitute “qualified dividend income.” However, a non-corporate taxpayer","page_number":420,"box":{"x":116,"y":335,"width":768,"height":12}},{"id":"d9454f6e-cffa-4c4d-87da-c4053ae9c2a7","block_type":"box","text":"who is a direct REIT shareholder may claim a 20% “qualified business income” deduction for ordinary","page_number":420,"box":{"x":116,"y":351,"width":757,"height":12}},{"id":"96fec484-3f6d-4b79-866e-78f28abdeec7","block_type":"box","text":"REIT dividends, and a regulated investment company may report dividends as eligible for this","page_number":420,"box":{"x":117,"y":366,"width":698,"height":12}},{"id":"7028ba49-629b-4653-8b52-ebcddfb1fc01","block_type":"box","text":"deduction to the extent the regulated investment company’s income is derived from ordinary REIT","page_number":420,"box":{"x":116,"y":382,"width":731,"height":12}},{"id":"10ec9854-c367-4944-8f11-0403986769a4","block_type":"box","text":"dividends (reduced by allocable regulated investment company expenses). A shareholder may treat","page_number":420,"box":{"x":116,"y":397,"width":745,"height":12}},{"id":"87c684a6-9850-4f3a-96a6-f69f2998320c","block_type":"box","text":"the dividends as such provided the regulated investment company and the shareholder satisfy","page_number":420,"box":{"x":116,"y":413,"width":704,"height":12}},{"id":"6ad91afa-a8d6-4371-a3bb-8505bfbf91b1","block_type":"box","text":"applicable holding period requirements.","page_number":420,"box":{"x":116,"y":428,"width":298,"height":12}},{"id":"48b2b3a9-f82d-4e8f-9e98-0be7e6ed27e5","block_type":"box","text":"REITs (especially mortgage REITs) are also subject to interest rate risk. Rising interest rates may","page_number":420,"box":{"x":117,"y":459,"width":728,"height":12}},{"id":"b60f90f7-26f5-45c3-bba8-e72f1812029f","block_type":"box","text":"cause REIT investors to demand a higher annual yield, which may, in turn, cause a decline in the","page_number":420,"box":{"x":116,"y":475,"width":726,"height":12}},{"id":"a8db36ee-1b8f-434d-8bcb-a1f9e0fb7721","block_type":"box","text":"market price of the equity securities issued by a REIT. Rising interest rates also generally increase the","page_number":420,"box":{"x":117,"y":490,"width":764,"height":12}},{"id":"02be2e99-da98-4130-95d5-7f9dc817c510","block_type":"box","text":"costs of obtaining financing, which could cause the value of a Fund’s REIT investments to decline.","page_number":420,"box":{"x":116,"y":506,"width":734,"height":12}},{"id":"3751a502-cd76-4a97-8d00-b1bdd9fc9bc4","block_type":"box","text":"During periods when interest rates are declining, mortgages are often refinanced. Refinancing may","page_number":420,"box":{"x":117,"y":521,"width":738,"height":12}},{"id":"95d3dbdc-a448-4b20-9e6f-89814b0b79e7","block_type":"box","text":"reduce the yield on investments in mortgage REITs. In addition, since REITs depend on payment","page_number":420,"box":{"x":117,"y":537,"width":726,"height":12}},{"id":"51ae18b0-4be1-41d7-a095-7b6c4b6dd0f9","block_type":"box","text":"under their mortgage loans and leases to generate cash to make distributions to their shareholders,","page_number":420,"box":{"x":117,"y":552,"width":743,"height":12}},{"id":"991b0fde-ec4e-4a15-9969-e4da71f2ac50","block_type":"box","text":"investments in REITs may be adversely affected by defaults on such mortgage loans or leases.","page_number":420,"box":{"x":117,"y":568,"width":712,"height":12}},{"id":"c97ce3ed-01b8-4b18-b664-92c50d3255cf","block_type":"box","text":"Investing in certain REITs, which often have small market capitalizations, may also involve the same","page_number":420,"box":{"x":117,"y":599,"width":741,"height":12}},{"id":"6499ad25-6df7-4322-8bb9-5495072cd527","block_type":"box","text":"risks as investing in other small capitalization companies. REITs may have limited financial resources,","page_number":420,"box":{"x":117,"y":614,"width":753,"height":12}},{"id":"870fabe5-24cb-4489-88b6-e0c16a24126d","block_type":"box","text":"and their securities may trade less frequently and in limited volume and may be subject to more abrupt","page_number":420,"box":{"x":116,"y":630,"width":758,"height":12}},{"id":"a107ce13-9980-4d17-9bea-fa36e05c594b","block_type":"box","text":"or erratic price movements than larger company securities. Historically, small capitalization stocks, such","page_number":420,"box":{"x":116,"y":645,"width":768,"height":12}},{"id":"e90f5857-5dbc-4691-b130-a8779a2cb0d5","block_type":"box","text":"as REITs, have been more volatile in price than the larger capitalization stocks such as those included","page_number":420,"box":{"x":116,"y":661,"width":750,"height":12}},{"id":"fd261c3d-15d1-4b92-8a04-1be95242a52d","block_type":"box","text":"in the S&P 500 Index. The management of a REIT may be subject to conflicts of interest with respect to","page_number":420,"box":{"x":117,"y":676,"width":759,"height":12}},{"id":"8a5ef58f-9444-43c0-b16f-e4eb6cf4c186","block_type":"box","text":"the operation of the business of the REIT and may be involved in real estate activities competitive with","page_number":420,"box":{"x":116,"y":692,"width":750,"height":12}},{"id":"a4d317a9-f8f9-44a3-954b-ab5062a3656e","block_type":"box","text":"the REIT. REITs may own properties through joint ventures or in other circumstances in which the REIT","page_number":420,"box":{"x":116,"y":707,"width":761,"height":12}},{"id":"ffb4b3f8-93f8-46e2-a04c-2b7fcb9afcb1","block_type":"box","text":"may not have control over its investments. REITs may incur significant amounts of leverage.","page_number":420,"box":{"x":117,"y":723,"width":675,"height":12}},{"id":"959d338e-e7c2-4318-963c-9cdc88089b6a","block_type":"box","text":"Market Risks/Recent Market Events.","page_number":420,"box":{"x":116,"y":754,"width":287,"height":9}},{"id":"67d5cfdd-483a-412e-9f8a-27141f223614","block_type":"box","text":"Securities may decline in value due to factors affecting","page_number":420,"box":{"x":409,"y":754,"width":405,"height":12}},{"id":"e53c1d11-c03b-43cb-9859-47c3fd44bff8","block_type":"box","text":"securities markets generally or particular industries represented in the markets. The value of a security","page_number":420,"box":{"x":116,"y":769,"width":762,"height":12}},{"id":"40445603-30a0-4c74-81e5-fbf037b9d834","block_type":"box","text":"may decline due to general market conditions, economic trends or events that are not specifically","page_number":420,"box":{"x":117,"y":785,"width":720,"height":12}},{"id":"990a3fb5-5723-4fb6-98b2-683a606e7349","block_type":"box","text":"related to a company or to factors that affect a particular industry or industries, or factors that affect a","page_number":420,"box":{"x":117,"y":800,"width":748,"height":12}},{"id":"7b8e479e-271f-4cd8-a30c-cfe4e9c62593","block_type":"box","text":"particular issuer or issuers, exchange, country, group of countries, region, market, industry, group of","page_number":420,"box":{"x":117,"y":816,"width":743,"height":12}},{"id":"fe6ac949-b6c1-457b-8bfa-0805c6975713","block_type":"box","text":"industries, sector or asset class. The success of a Fund’s activities could be affected by interest rates,","page_number":420,"box":{"x":117,"y":831,"width":761,"height":12}},{"id":"82032eb1-5244-4501-b62c-3467bb1f3107","block_type":"box","text":"availability of credit, inflation rates, economic uncertainty, changes in laws, trade barriers, economic","page_number":420,"box":{"x":116,"y":847,"width":744,"height":12}},{"id":"51bcd895-9675-482d-91f8-1ff47a5f1706","block_type":"box","text":"sanctions, currency exchange controls, and local, regional or global events such as war, acts of","page_number":420,"box":{"x":116,"y":862,"width":714,"height":12}},{"id":"b4edb0f7-2ca3-4070-9c26-9233a903b51d","block_type":"box","text":"terrorism, natural and environmental disasters, the spread of infectious illness or other public health","page_number":420,"box":{"x":116,"y":878,"width":744,"height":12}},{"id":"10858364-2c6d-406f-ba24-b0147cbd910e","block_type":"box","text":"II-88","page_number":420,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"49c0f4fa-ba97-4e96-ac0a-85238301aeba","block_type":"box","text":"NM1026U-6004382-420/605","page_number":420,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"1120873c-fd8c-4d7d-a97b-d5acd1713f6b","block_type":"box","text":"issues, recessions, or other events could have a significant impact on a Fund and its investments.","page_number":421,"box":{"x":117,"y":87,"width":730,"height":12}},{"id":"9f017fb1-ae45-402c-8674-7ca94a468749","block_type":"box","text":"During a general economic downturn in the securities markets, multiple asset classes may be","page_number":421,"box":{"x":117,"y":103,"width":698,"height":12}},{"id":"6ae39ea0-f3fe-49b2-949c-cd48dc69ab64","block_type":"box","text":"negatively affected. These factors may affect the level and volatility of securities prices and the liquidity","page_number":421,"box":{"x":117,"y":118,"width":768,"height":12}},{"id":"adae9e68-6fb3-4f7b-b46e-63662cdc3024","block_type":"box","text":"of a Fund’s investments, which could impair the Fund’s profitability or result in losses. A Fund may","page_number":421,"box":{"x":116,"y":134,"width":734,"height":12}},{"id":"7d0d9499-9df7-47f0-a005-23235615c6d2","block_type":"box","text":"maintain substantial trading positions that can be adversely affected by the level of volatility in the","page_number":421,"box":{"x":117,"y":149,"width":728,"height":12}},{"id":"fb960a91-05dc-4697-8751-69209be731c1","block_type":"box","text":"financial markets; the larger the positions, the greater the potential for loss. Unpredictable or unstable","page_number":421,"box":{"x":116,"y":165,"width":758,"height":12}},{"id":"47804d78-8f53-4f5a-bb75-c62336a3a5af","block_type":"box","text":"market conditions may result in reduced opportunities to find suitable investments to deploy capital or","page_number":421,"box":{"x":117,"y":180,"width":756,"height":12}},{"id":"85f78adb-31ad-4c21-bc72-39fd4c9419a3","block_type":"box","text":"make it more difficult to exit and realize value","page_number":421,"box":{"x":117,"y":196,"width":339,"height":9}},{"id":"ee08261d-9252-407b-a9a8-9f2fd0dbc330","block_type":"box","text":"from a Fund’s existing investments. It is important to","page_number":421,"box":{"x":456,"y":196,"width":394,"height":12}},{"id":"5f43899c-2817-4ca7-9fc9-47e0bdf22e94","block_type":"box","text":"understand that a Fund can incur material losses even if it reacts quickly to difficult market conditions","page_number":421,"box":{"x":117,"y":211,"width":754,"height":12}},{"id":"1e79de49-efa8-4316-bf54-d83a68de249e","block_type":"box","text":"and there can be no assurance that a Fund will not suffer material adverse effects from broad and","page_number":421,"box":{"x":116,"y":227,"width":732,"height":9}},{"id":"04c572ee-e3a5-4f49-8e51-2813a48951e2","block_type":"box","text":"rapid changes in market conditions.","page_number":421,"box":{"x":117,"y":242,"width":268,"height":12}},{"id":"7e204376-5ec6-4600-90ed-81d1cb701052","block_type":"box","text":"Periods of unusually high volatility in the financial markets and restrictive credit conditions, sometimes","page_number":421,"box":{"x":117,"y":273,"width":759,"height":12}},{"id":"5f475cac-fb8c-4d3a-b5bf-672fedf78fea","block_type":"box","text":"limited to a particular sector or a geography, can occur. Some countries, including the United States,","page_number":421,"box":{"x":117,"y":289,"width":750,"height":12}},{"id":"d1701031-4879-435c-92ca-bcc2278c72c3","block_type":"box","text":"have adopted and/or are considering the adoption of more protectionist trade policies, a move away","page_number":421,"box":{"x":117,"y":304,"width":744,"height":12}},{"id":"696c96b5-c5ef-4c8b-8a54-ce33051c114b","block_type":"box","text":"from the tighter financial industry regulations that followed the financial crisis of 2008, and/or","page_number":421,"box":{"x":116,"y":320,"width":689,"height":12}},{"id":"b81e0e54-b345-4d10-8bf0-b5d3d6581610","block_type":"box","text":"substantially reducing corporate taxes. The exact shape of these policies is still being considered, but","page_number":421,"box":{"x":116,"y":335,"width":757,"height":12}},{"id":"e76b1062-a84a-42ad-8487-a8deb99fc9ce","block_type":"box","text":"the equity and debt markets may react strongly to expectations of change, which could increase","page_number":421,"box":{"x":116,"y":351,"width":717,"height":12}},{"id":"58500f2f-c383-4dbf-8132-496cccdae2fc","block_type":"box","text":"volatility, especially if the market’s expectations are not borne out. A rise in protectionist trade policies,","page_number":421,"box":{"x":116,"y":366,"width":763,"height":12}},{"id":"1df02322-a947-40b3-9538-c18cbf58485b","block_type":"box","text":"and the possibility of changes to some international trade agreements, could affect the economies of","page_number":421,"box":{"x":116,"y":382,"width":751,"height":12}},{"id":"7fb711c6-fc56-4b8c-b8e4-1c9cf3a70a57","block_type":"box","text":"many nations in ways that cannot necessarily be foreseen at the present time. In addition, geopolitical","page_number":421,"box":{"x":117,"y":397,"width":760,"height":12}},{"id":"9c9164b4-3134-4920-bb6f-85f8e54d4069","block_type":"box","text":"and other risks, including environmental and public health, may add to instability in world economies","page_number":421,"box":{"x":116,"y":413,"width":748,"height":12}},{"id":"06ff5607-a2ad-444f-b5c5-ad8d854f3b82","block_type":"box","text":"and markets generally. Economies and financial markets throughout the world are increasingly","page_number":421,"box":{"x":116,"y":428,"width":707,"height":12}},{"id":"3b100eb2-b067-486d-9f18-bcaad7460755","block_type":"box","text":"interconnected. As a result, whether or not a Fund invests in securities of issuers located in or with","page_number":421,"box":{"x":117,"y":444,"width":735,"height":11}},{"id":"cc89ea16-867e-47ce-88fb-6944225372fc","block_type":"box","text":"significant exposure to countries experiencing economic, political and/or financial difficulties, the value","page_number":421,"box":{"x":116,"y":459,"width":762,"height":12}},{"id":"bbe5b04d-16b5-400d-b262-9a2c9549f933","block_type":"box","text":"and liquidity of the Fund’s investments may be negatively affected by such events.","page_number":421,"box":{"x":116,"y":475,"width":616,"height":12}},{"id":"669aa711-efe7-40d2-977b-74bcbacdc088","block_type":"box","text":"Governments and regulators may take actions that affect the regulation of the Fund or the instruments","page_number":421,"box":{"x":117,"y":506,"width":754,"height":12}},{"id":"6df77046-2ceb-4eac-b4b7-f8ee662709cd","block_type":"box","text":"in which the Fund invests, or the issuers of such instruments, in ways that are unforeseeable. Future","page_number":421,"box":{"x":117,"y":521,"width":742,"height":12}},{"id":"e41d838a-ee8a-4100-a289-dd3c61b79ef3","block_type":"box","text":"legislation or regulation or other governmental actions could limit or preclude the Fund’s abilities to","page_number":421,"box":{"x":117,"y":537,"width":727,"height":12}},{"id":"8f9b9efe-c7d6-44e8-8b8e-160847af65ee","block_type":"box","text":"achieve its investment objectives or otherwise adversely impact an investment in the Fund. Recent","page_number":421,"box":{"x":116,"y":552,"width":730,"height":12}},{"id":"57936426-52a5-47b4-9eb1-a279710bec77","block_type":"box","text":"policy initiatives undertaken by the U.S. government have the potential to impact international relations,","page_number":421,"box":{"x":117,"y":568,"width":763,"height":12}},{"id":"a3b9497a-0ea9-4101-9d4d-00e4a75f73fa","block_type":"box","text":"trade agreements and the overall regulatory environment in ways that could create uncertainty and","page_number":421,"box":{"x":116,"y":583,"width":730,"height":12}},{"id":"10b09dc4-63c5-43d1-94a7-8c87af2dce57","block_type":"box","text":"instability in domestic and global markets, and could adversely affect the investment performance of the","page_number":421,"box":{"x":117,"y":599,"width":766,"height":12}},{"id":"b1ad56da-3959-4fb9-b8b8-6d510057e060","block_type":"box","text":"Fund. In particular, actions taken by the U.S. government in respect of international trade relations could","page_number":421,"box":{"x":117,"y":614,"width":770,"height":12}},{"id":"4f2c76d5-2103-47ba-bd04-8818dc5e6495","block_type":"box","text":"lead to trade wars, increased costs for imported goods, disruptions in supply chains, reduced foreign","page_number":421,"box":{"x":117,"y":630,"width":742,"height":12}},{"id":"34d127ad-de04-49e7-87aa-0fb0d4ebd2b1","block_type":"box","text":"investment, and instability in regions where the Fund invests. Political and diplomatic events within the","page_number":421,"box":{"x":117,"y":645,"width":755,"height":12}},{"id":"08916ff3-ab7b-4905-b9c8-35dbdc07b9aa","block_type":"box","text":"United States, including a contentious domestic political environment, changes in political party control","page_number":421,"box":{"x":117,"y":661,"width":750,"height":12}},{"id":"b01f76e1-d4dd-4090-9c12-9bf232e94d44","block_type":"box","text":"of one or more branches of the U.S. Government, the U.S. Government’s inability at times to agree on a","page_number":421,"box":{"x":116,"y":676,"width":764,"height":12}},{"id":"c5eb369c-3737-4888-b225-c895720c3f01","block_type":"box","text":"long-term budget and deficit reduction plan, the threat of a U.S. Government shutdown, and","page_number":421,"box":{"x":117,"y":692,"width":672,"height":12}},{"id":"a3fb5b84-0d0e-47ef-8862-17530268964a","block_type":"box","text":"disagreements over, or threats not to increase, the U.S. Government’s borrowing limit (or “debt ceiling”),","page_number":421,"box":{"x":116,"y":707,"width":763,"height":12}},{"id":"b43bcbf7-65b7-4166-8985-f9c092bb2d54","block_type":"box","text":"as well as political and diplomatic events abroad, may affect investor and consumer confidence and","page_number":421,"box":{"x":116,"y":723,"width":731,"height":12}},{"id":"a06ec509-c5f0-43ad-bcf8-cd23f0d721e4","block_type":"box","text":"may adversely impact financial markets and the broader economy, perhaps suddenly and to a","page_number":421,"box":{"x":117,"y":738,"width":689,"height":12}},{"id":"8a2950e6-d48e-4458-9a4b-6bbdc10899b1","block_type":"box","text":"significant degree. A downgrade of the ratings of U.S. Government debt obligations, or concerns about","page_number":421,"box":{"x":116,"y":754,"width":754,"height":12}},{"id":"9c7bea62-4011-42a8-8ff4-0c11ebc4a73a","block_type":"box","text":"the U.S. Government’s credit quality in general, could have a substantial negative effect on the U.S. and","page_number":421,"box":{"x":116,"y":769,"width":764,"height":12}},{"id":"df07825c-ecb0-4f5f-aae4-be31b0ccce1b","block_type":"box","text":"global economies. For example, concerns about the U.S. Government’s credit quality may cause","page_number":421,"box":{"x":116,"y":785,"width":710,"height":12}},{"id":"75c7227b-6070-429d-8640-f0d899be588b","block_type":"box","text":"increased volatility in the stock and bond markets, higher interest rates, reduced prices and liquidity of","page_number":421,"box":{"x":117,"y":800,"width":748,"height":12}},{"id":"7d65dca2-d6be-43fa-9573-1beb945e16a1","block_type":"box","text":"U.S. Treasury securities, and/or increased costs of various kinds of debt. Moreover, although the U.S.","page_number":421,"box":{"x":117,"y":816,"width":745,"height":12}},{"id":"7f0f7b51-7fbc-433f-935a-1e897eb49c7a","block_type":"box","text":"Government has honored its credit obligations, there remains a possibility that the United States could","page_number":421,"box":{"x":117,"y":831,"width":754,"height":12}},{"id":"840865c5-5470-4dde-ba3c-5751bfc9875f","block_type":"box","text":"default on its obligations. The consequences of such an unprecedented event are impossible to predict,","page_number":421,"box":{"x":116,"y":847,"width":765,"height":12}},{"id":"9c3a5f68-42f3-45f3-b90e-bf55342f4bd1","block_type":"box","text":"but it is likely that a default by the United States would be highly disruptive to the U.S. and global","page_number":421,"box":{"x":117,"y":862,"width":714,"height":12}},{"id":"4f7e6f7f-7ebd-49b9-977c-b6b7ed55c334","block_type":"box","text":"securities markets and could significantly impair the value of the Fund’s investments.","page_number":421,"box":{"x":116,"y":878,"width":627,"height":12}},{"id":"f26b27a2-a4e6-44f0-9b08-c6bc60584cb6","block_type":"box","text":"II-89","page_number":421,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"1543aafd-587a-4db1-b041-9e967a866962","block_type":"box","text":"NM1026U-6004382-421/605","page_number":421,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"8c80d7e5-b943-44fe-a440-7542c84c2ad6","block_type":"box","text":"The COVID-19 pandemic resulted in significant market volatility, exchange suspensions and closures,","page_number":422,"box":{"x":116,"y":87,"width":761,"height":12}},{"id":"ffe35d79-20da-4038-99b1-4e34d78b3047","block_type":"box","text":"declines in global financial markets, higher default rates, supply chain disruptions, and a substantial","page_number":422,"box":{"x":116,"y":102,"width":743,"height":13}},{"id":"0d077ce0-7a89-4209-a0d0-a62a690e07b1","block_type":"box","text":"economic downturn in economies throughout the world. The impact of this coronavirus, and other","page_number":422,"box":{"x":116,"y":118,"width":727,"height":12}},{"id":"4f6c4a8d-6608-4f04-9b8f-dd7f0ecb8658","block_type":"box","text":"epidemics and pandemics that may arise in the future, could affect the economies of many nations,","page_number":422,"box":{"x":116,"y":134,"width":741,"height":12}},{"id":"d74f79dd-20de-485b-87ac-156c543ec7cd","block_type":"box","text":"individual companies and the market in general in ways that cannot necessarily be foreseen at the","page_number":422,"box":{"x":117,"y":149,"width":733,"height":12}},{"id":"79a3c75e-b7fc-462b-a34c-d311a071429c","block_type":"box","text":"present time. These health crises may be short term or long term, and may exacerbate other pre","page_number":422,"box":{"x":117,"y":165,"width":721,"height":12}},{"id":"5cddd5ef-5eee-4f93-b151-032a1bdc518f","block_type":"box","text":"existing political, social and economic risks, disrupt normal market conditions and operations, and","page_number":422,"box":{"x":116,"y":180,"width":729,"height":12}},{"id":"b3317971-c755-47fc-9d96-494d3e37b9dd","block_type":"box","text":"negatively impact performance. In addition, the impact of infectious diseases in emerging developing or","page_number":422,"box":{"x":117,"y":196,"width":771,"height":12}},{"id":"d025fa65-30d4-4f5d-8f4b-fc63a55d6978","block_type":"box","text":"emerging market countries may be greater due to less established health care systems.","page_number":422,"box":{"x":116,"y":211,"width":657,"height":12}},{"id":"f52995cb-dc2a-4205-aeb8-1bd5ba61e5f2","block_type":"box","text":"Legal and Regulatory Risks","page_number":422,"box":{"x":116,"y":242,"width":205,"height":12}},{"id":"8e42b7f5-a781-4e40-a6e4-f65964d29fb0","block_type":"box","text":". The Manager is part of a larger firm with multiple business lines active in","page_number":422,"box":{"x":323,"y":242,"width":550,"height":12}},{"id":"17574ec3-ee0f-4a10-a7ba-5bc01f2bf75b","block_type":"box","text":"multiple jurisdictions that are governed by a multitude of legal systems and regulatory regimes, some","page_number":422,"box":{"x":117,"y":258,"width":753,"height":12}},{"id":"3415b9aa-6920-4d42-87c1-ce17e06d75ba","block_type":"box","text":"of which are new and evolving. As a result, the Funds and the Manager and its affiliates are subject to","page_number":422,"box":{"x":116,"y":273,"width":761,"height":12}},{"id":"68eb1f09-8185-4c66-a310-b06f520dc17c","block_type":"box","text":"extensive and sophisticated legal, tax and regulatory risks, including changing laws and regulations,","page_number":422,"box":{"x":116,"y":289,"width":746,"height":12}},{"id":"bfde2096-6a9c-416b-b8f1-cd91ce253892","block_type":"box","text":"developing interpretations of such laws and regulations, as well as existing laws, and increased","page_number":422,"box":{"x":116,"y":304,"width":712,"height":12}},{"id":"0f0a3c38-b9a4-4315-bcc4-4e5735d4fc82","block_type":"box","text":"scrutiny by regulators and law enforcement authorities. Unexpected economic, political, regulatory and","page_number":422,"box":{"x":116,"y":320,"width":766,"height":12}},{"id":"89dde5df-ca8d-4fb8-ab06-833b89b98f50","block_type":"box","text":"diplomatic events within the United States and abroad can trigger new and complex regulations that","page_number":422,"box":{"x":116,"y":335,"width":745,"height":12}},{"id":"eba52be6-ed2f-4263-8b42-e85fbbf63159","block_type":"box","text":"the Manager and/or the Funds may need to comply with. The implementation of changes to comply","page_number":422,"box":{"x":116,"y":351,"width":742,"height":12}},{"id":"44ec5035-9ecc-4293-be36-d5f5dfe42c81","block_type":"box","text":"with current and/or new regulations applicable to the Funds and/or the Manager could have a material","page_number":422,"box":{"x":116,"y":366,"width":761,"height":12}},{"id":"f6281865-1f30-47f1-bff2-d869f019073c","block_type":"box","text":"adverse effect on the Funds (including by imposing material costs on the Funds, reducing profit","page_number":422,"box":{"x":116,"y":382,"width":712,"height":12}},{"id":"cad3ac47-c2cd-4c97-940e-e66958513c01","block_type":"box","text":"margins, reducing investment opportunities or by otherwise restricting the Funds and/or the Manager).","page_number":422,"box":{"x":117,"y":397,"width":762,"height":12}},{"id":"7bd5ebd1-b83b-46a5-8108-e7bc76d8d6bd","block_type":"box","text":"Tariff and Trade Policy Risks","page_number":422,"box":{"x":118,"y":428,"width":213,"height":12}},{"id":"e30a6e7e-1f55-4453-9f72-db440f7c327a","block_type":"box","text":".","page_number":422,"box":{"x":331,"y":436,"width":3,"height":1}},{"id":"9501d72d-e706-4615-ada0-7d361fe1c1ca","block_type":"box","text":"Some countries, including the U.S., have adopted more protectionist","page_number":422,"box":{"x":335,"y":428,"width":518,"height":12}},{"id":"370ee1e9-4775-4942-8e4c-c36d710c153b","block_type":"box","text":"trade policies. The U.S. government recently altered its approach to international trade policy, resulting","page_number":422,"box":{"x":116,"y":444,"width":768,"height":12}},{"id":"8568cc83-5f97-47de-a425-adce41ded05e","block_type":"box","text":"in significant impacts on international trade relations, certain tax and immigration policies, and other","page_number":422,"box":{"x":117,"y":459,"width":742,"height":12}},{"id":"50e4504e-ea78-454f-980b-411216a2c11d","block_type":"box","text":"aspects of the national and international political and financial landscape. The rise in protectionist trade","page_number":422,"box":{"x":116,"y":475,"width":769,"height":12}},{"id":"369d8a9f-2609-404e-98d7-41714b927831","block_type":"box","text":"policies, slowing economic growth, changes to some major international trade agreements, risks","page_number":422,"box":{"x":117,"y":490,"width":718,"height":12}},{"id":"8af6f739-fa36-439e-9087-550fe75db422","block_type":"box","text":"associated with trade agreements between the U.S. and the European Union, and the risks associated","page_number":422,"box":{"x":116,"y":506,"width":767,"height":12}},{"id":"edf5a784-a50f-4f17-b9ec-c7f3a43796e4","block_type":"box","text":"with trade negotiations between the U.S. and China, could affect the economies of many nations in","page_number":422,"box":{"x":116,"y":521,"width":739,"height":12}},{"id":"312d5526-2b32-46c9-ae6c-6f99867c875d","block_type":"box","text":"ways that cannot necessarily be foreseen at the present time.","page_number":422,"box":{"x":116,"y":537,"width":462,"height":12}},{"id":"fa59fd11-897e-4c84-ab74-dcfea0029ab3","block_type":"box","text":"Global trade disruption, significant introductions of trade barriers, and bilateral trade frictions, together","page_number":422,"box":{"x":117,"y":568,"width":759,"height":12}},{"id":"22ea75c2-bb76-4fd3-a2a8-6b89fe7f8ce0","block_type":"box","text":"with any future downturns in the global economy resulting therefrom, could adversely affect the","page_number":422,"box":{"x":116,"y":583,"width":710,"height":12}},{"id":"abbd3162-ef57-402e-ad42-725a79856869","block_type":"box","text":"financial performance of a Fund and its investments. Trade policy may be an ongoing source of","page_number":422,"box":{"x":116,"y":599,"width":713,"height":12}},{"id":"157862aa-deb8-4c72-80a5-9ac264340571","block_type":"box","text":"instability, potentially resulting in significant currency fluctuations and/or having other adverse effects","page_number":422,"box":{"x":117,"y":614,"width":751,"height":12}},{"id":"86ba422b-37a3-41e9-a393-85f3bd02afee","block_type":"box","text":"on international markets, international trade agreements, and/or other existing cross-border","page_number":422,"box":{"x":116,"y":630,"width":683,"height":12}},{"id":"ddfdb306-0511-4379-a35f-c572b7a0371e","block_type":"box","text":"cooperation arrangements (whether economic, tax, fiscal, legal, regulatory, or otherwise). To the extent","page_number":422,"box":{"x":116,"y":645,"width":771,"height":12}},{"id":"37582f74-67a2-4f66-84b0-5ff18cffddfd","block_type":"box","text":"trade disputes escalate globally, there could be additional significant impacts on the sectors or","page_number":422,"box":{"x":116,"y":661,"width":700,"height":12}},{"id":"9e419b7d-87b6-4c4e-821c-ac516565756f","block_type":"box","text":"industries in which a Fund invests and other adverse impacts on a Fund’s overall performance.","page_number":422,"box":{"x":117,"y":676,"width":703,"height":12}},{"id":"dde18967-401f-483d-b8e1-636cb8c41d51","block_type":"box","text":"Geographic Risks","page_number":422,"box":{"x":117,"y":707,"width":131,"height":12}},{"id":"39935787-3865-44c0-a7ca-acdd83f5e359","block_type":"box","text":". Some of the companies in which the Fund invests may be located in, or otherwise","page_number":422,"box":{"x":250,"y":707,"width":616,"height":12}},{"id":"25c4d943-a417-493d-8f81-f4eb16d9fa73","block_type":"box","text":"connected to, parts of the world affected by natural disasters such as severe heat, earthquakes,","page_number":422,"box":{"x":116,"y":723,"width":711,"height":12}},{"id":"cfd03354-3592-4a39-a0cd-927ee022944a","block_type":"box","text":"tornadoes, volcanic eruptions, wildfires, droughts, floods, hurricanes or tsunamis, and are economically","page_number":422,"box":{"x":116,"y":738,"width":766,"height":12}},{"id":"71f05402-df2c-4463-bb95-8cf8f5a8136e","block_type":"box","text":"sensitive to environmental events. In addition, issuers may be impacted by security concerns with","page_number":422,"box":{"x":116,"y":754,"width":723,"height":12}},{"id":"4a4e6933-2cdb-49d0-9a4e-dab6209fc007","block_type":"box","text":"respect to a country or region, such as war and other types of conflict, terrorism, strained international","page_number":422,"box":{"x":117,"y":769,"width":754,"height":12}},{"id":"540c81ed-c9ff-43f0-8963-a8cce03c36fd","block_type":"box","text":"relations and territorial disputes. Any of these events may adversely affect the issuers, markets and","page_number":422,"box":{"x":117,"y":785,"width":736,"height":12}},{"id":"46338e32-2c4e-4991-bb07-79d8422da5c6","block_type":"box","text":"economies to which a Fund is exposed, which may adversely affect the value of the Fund.","page_number":422,"box":{"x":116,"y":800,"width":667,"height":12}},{"id":"cedcef00-62fd-42d9-95d7-2ef3d5bfb284","block_type":"box","text":"Reference Rate Replacement Risk.","page_number":422,"box":{"x":116,"y":831,"width":275,"height":12}},{"id":"a5d0690e-34ab-44a4-91f3-d478606b0ef6","block_type":"box","text":"The London Interbank Offered Rate (“LIBOR”) had historically","page_number":422,"box":{"x":393,"y":831,"width":469,"height":12}},{"id":"cce1edfd-59f5-499c-931f-30005d361143","block_type":"box","text":"been used extensively in the U.S. and globally as a “benchmark” or “reference rate” for various","page_number":422,"box":{"x":117,"y":847,"width":707,"height":12}},{"id":"c148301c-5a69-4376-b1c0-d6f13b56711a","block_type":"box","text":"commercial and financial contracts, including corporate and municipal bonds, bank loans, asset","page_number":422,"box":{"x":116,"y":862,"width":714,"height":12}},{"id":"e7d66800-42fe-4a79-89a1-b55ef2c2dfd4","block_type":"box","text":"backed and mortgage-related securities, interest rate swaps and other derivatives. Instruments in","page_number":422,"box":{"x":117,"y":878,"width":726,"height":12}},{"id":"23e5bc45-2a6b-4b0e-831b-6216a207666f","block_type":"box","text":"II-90","page_number":422,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"a3378470-b72b-45d4-831d-858f89c7eb06","block_type":"box","text":"NM1026U-6004382-422/605","page_number":422,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"bbf873da-ce2a-40bb-86bd-933b8116a325","block_type":"box","text":"which a Fund may have historically paid interest at floating rates based on LIBOR or may have been","page_number":423,"box":{"x":116,"y":87,"width":750,"height":12}},{"id":"c530b55d-3fa3-4a77-ba5f-6bd9972ac381","block_type":"box","text":"subject to interest caps or floors based on LIBOR. The Funds and issuers of instruments in which a","page_number":423,"box":{"x":116,"y":102,"width":742,"height":13}},{"id":"eb108033-7463-419a-a932-14cbae2b35d8","block_type":"box","text":"Fund invests may have also historically obtained financing at floating rates based on LIBOR. In","page_number":423,"box":{"x":117,"y":118,"width":709,"height":12}},{"id":"c0f2e35f-fb19-4ee6-863c-685a273deab3","block_type":"box","text":"connection with the global transition away from LIBOR led by regulators and market participants as a","page_number":423,"box":{"x":116,"y":134,"width":754,"height":12}},{"id":"646a7279-ffd8-407a-906e-8c5368da4df2","block_type":"box","text":"result of benchmark reforms, LIBOR was last published on a representative basis at the end of June","page_number":423,"box":{"x":117,"y":149,"width":748,"height":12}},{"id":"d9c4fc29-bebc-4986-a864-0f259c7f446b","block_type":"box","text":"2023. Alternative reference rates to LIBOR have been established in most major currencies and","page_number":423,"box":{"x":116,"y":165,"width":717,"height":12}},{"id":"21189250-8272-4941-80b5-e711751f8fcb","block_type":"box","text":"markets in these alternative rates are continuing to develop (","page_number":423,"box":{"x":117,"y":180,"width":449,"height":12}},{"id":"22e1d327-6b53-490f-b8b1-67ab1252514d","block_type":"box","text":"e.g.","page_number":423,"box":{"x":568,"y":183,"width":25,"height":9}},{"id":"e9301374-4b1c-40f9-800d-65b53c378039","block_type":"box","text":", the Secured Overnight Financing","page_number":423,"box":{"x":596,"y":180,"width":259,"height":12}},{"id":"8a0d480a-2ad2-47ea-9f6c-5704dddb2b23","block_type":"box","text":"Rate (“SOFR”) for USD-LIBOR). While the transition from LIBOR has gone relatively smoothly, residual","page_number":423,"box":{"x":117,"y":196,"width":771,"height":12}},{"id":"9bf5bdd6-5733-4532-ad38-c44ec62c12f8","block_type":"box","text":"risks associated with the transition may remain that may impact markets or particular investments and,","page_number":423,"box":{"x":117,"y":211,"width":765,"height":12}},{"id":"ff8bc3f8-0110-4e6f-9862-9348a2107132","block_type":"box","text":"as such, the full impact of the transition on the Funds or the financial instruments in which the Funds","page_number":423,"box":{"x":116,"y":227,"width":749,"height":11}},{"id":"ccbae615-d11b-42ec-843f-ad15bcd82a4b","block_type":"box","text":"invest cannot yet be fully determined.","page_number":423,"box":{"x":117,"y":242,"width":281,"height":12}},{"id":"727a9552-8a4c-4e72-b6b1-986df1ce3237","block_type":"box","text":"SOFR is intended to be a broad measure of the cost of borrowing funds overnight in transactions that","page_number":423,"box":{"x":116,"y":273,"width":757,"height":12}},{"id":"0e765208-9742-4138-915b-681c02152589","block_type":"box","text":"are collateralized by U.S. Treasury securities . SOFR is calculated based on transaction-level repo","page_number":423,"box":{"x":116,"y":289,"width":736,"height":12}},{"id":"d8b2a23a-ce7e-4bf7-823b-01d343a1c09b","block_type":"box","text":"data collected from various sources. For each trading day, SOFR is calculated as a volume-weighted","page_number":423,"box":{"x":116,"y":304,"width":755,"height":12}},{"id":"548d7bc0-ef96-4e13-8493-f55125f782ed","block_type":"box","text":"median rate derived from such data. Because SOFR is a financing rate based on overnight secured","page_number":423,"box":{"x":117,"y":320,"width":744,"height":12}},{"id":"095b5676-0320-463d-96f8-d0f34f135d92","block_type":"box","text":"funding transactions, it differs fundamentally from LIBOR. LIBOR is intended to be an unsecured rate","page_number":423,"box":{"x":116,"y":335,"width":755,"height":12}},{"id":"2760c565-6967-4cc2-8647-dc220dbc057d","block_type":"box","text":"that represents interbank funding costs for different short-term maturities or tenors. It is a forward","page_number":423,"box":{"x":116,"y":351,"width":726,"height":12}},{"id":"f5a564ce-4493-450d-9508-2f233e0b0b4c","block_type":"box","text":"looking rate reflecting expectations regarding interest rates for the applicable tenor. Thus, LIBOR is","page_number":423,"box":{"x":117,"y":366,"width":740,"height":12}},{"id":"b7898b51-10ef-4937-ae35-b9c486d18712","block_type":"box","text":"intended to be sensitive, in certain respects, to bank credit risk and to term interest rate risk. In","page_number":423,"box":{"x":117,"y":382,"width":706,"height":12}},{"id":"a13743d8-2611-4457-9bd0-0830e67cbf73","block_type":"box","text":"contrast, SOFR is a secured overnight rate reflecting the credit of U.S. Treasury securities as","page_number":423,"box":{"x":116,"y":397,"width":696,"height":12}},{"id":"22917ad8-98a6-4517-be91-8956bcb0e0d0","block_type":"box","text":"collateral. Thus, it is largely insensitive to credit-risk considerations and to short-term interest rate risks.","page_number":423,"box":{"x":116,"y":413,"width":771,"height":12}},{"id":"395c5951-f14c-4141-88d0-24eb4f0fbbe4","block_type":"box","text":"SOFR is a transaction-based rate, and it has been more volatile than other benchmark or market rates,","page_number":423,"box":{"x":116,"y":428,"width":770,"height":11}},{"id":"eacb59af-4d61-45fc-9218-0de57f2154d8","block_type":"box","text":"such as three-month LIBOR, during certain periods. For these reasons, among others, there is no","page_number":423,"box":{"x":116,"y":444,"width":730,"height":12}},{"id":"bbf1e975-c8e9-4e30-b385-6922aecb3256","block_type":"box","text":"assurance that SOFR, or rates derived from SOFR, will perform in the same or similar way as LIBOR","page_number":423,"box":{"x":116,"y":459,"width":755,"height":12}},{"id":"05c28368-d3fc-45b5-9ac5-2c9ec50675fe","block_type":"box","text":"would have performed at any time, and there is no assurance that SOFR-based rates will be a suitable","page_number":423,"box":{"x":116,"y":475,"width":767,"height":12}},{"id":"61015745-2b42-45f9-a613-e354de69eab3","block_type":"box","text":"substitute for LIBOR. SOFR has a relatively limited history, having been first published in April 2018.","page_number":423,"box":{"x":116,"y":490,"width":749,"height":12}},{"id":"aea3809c-60f4-4df4-90f5-69df3bb66489","block_type":"box","text":"The future performance of SOFR, and SOFR-based reference rates, cannot be predicted based on","page_number":423,"box":{"x":116,"y":506,"width":740,"height":12}},{"id":"2f4e4317-0fe2-419a-9060-909c4375ef9d","block_type":"box","text":"SOFR’s history or otherwise. Levels of SOFR in the future may bear little or no relation to historical","page_number":423,"box":{"x":116,"y":521,"width":738,"height":12}},{"id":"b55ecbc3-9bc2-4625-8b0e-ec42d3e92709","block_type":"box","text":"levels of SOFR, LIBOR or other rates. There can also be no assurance that SOFR will not be","page_number":423,"box":{"x":117,"y":537,"width":695,"height":11}},{"id":"c6bdbcb9-6cac-4d89-8b52-9eb677d5caf4","block_type":"box","text":"discontinued or fundamentally altered in a manner that is materially adverse to the interests of the","page_number":423,"box":{"x":116,"y":552,"width":731,"height":12}},{"id":"007c2564-f09b-4425-a406-62dafc0aab3e","block_type":"box","text":"Fund.","page_number":423,"box":{"x":117,"y":568,"width":46,"height":9}},{"id":"3c358f02-ac02-4825-a8fc-686d159b23d9","block_type":"box","text":"In addition, interest rates or other types of rates and indices which are classified as “benchmarks” have","page_number":423,"box":{"x":117,"y":599,"width":768,"height":12}},{"id":"1a07c91f-4192-4e67-8134-f4022b9ac313","block_type":"box","text":"been the subject of ongoing national and international regulatory reform, including under the European","page_number":423,"box":{"x":117,"y":614,"width":765,"height":12}},{"id":"e971bf7c-1ea1-4cf6-8b58-338452a91b0e","block_type":"box","text":"Union (“EU”) regulation on indices used as benchmarks in financial instruments and financial contracts","page_number":423,"box":{"x":117,"y":630,"width":765,"height":12}},{"id":"c8cc87c6-4a77-4b79-a067-a71141ebe419","block_type":"box","text":"(known as the “Benchmarks Regulation”). The Benchmarks Regulation has been enacted into United","page_number":423,"box":{"x":117,"y":645,"width":754,"height":12}},{"id":"29db6d0c-08f1-4a21-ba8c-bb2dc62d7cb5","block_type":"box","text":"Kingdom (“UK”) law by virtue of the EU (Withdrawal) Act 2018 (as amended), subject to amendments","page_number":423,"box":{"x":117,"y":661,"width":750,"height":12}},{"id":"77fc4734-dcef-4375-b52f-a821f55e26c8","block_type":"box","text":"made by the Benchmarks (Amendment and Transitional Provision) (EU Exit) Regulations 2019 (SI","page_number":423,"box":{"x":117,"y":676,"width":727,"height":12}},{"id":"8b65cba1-293f-474e-8a03-f789d7892a47","block_type":"box","text":"2019/657) and other statutory instruments. Following the implementation of these reforms, the manner","page_number":423,"box":{"x":116,"y":692,"width":761,"height":12}},{"id":"b5065097-b7dd-4b91-92c8-94778a3ceb58","block_type":"box","text":"of administration of benchmarks has changed and may further change in the future, with the result that","page_number":423,"box":{"x":116,"y":707,"width":762,"height":12}},{"id":"7ca49a2d-edea-4249-b200-67d653e457a1","block_type":"box","text":"relevant benchmarks may perform differently than in the past, the use of benchmarks that are not","page_number":423,"box":{"x":117,"y":723,"width":721,"height":12}},{"id":"ebd6feb4-b6c3-48eb-8699-fa89a4446c01","block_type":"box","text":"compliant with the new standards by certain supervised entities may be restricted, and certain","page_number":423,"box":{"x":116,"y":738,"width":696,"height":12}},{"id":"6568ee0c-8f89-4ed6-9e73-eb85697a75e7","block_type":"box","text":"benchmarks may be eliminated entirely. Such changes could cause increased market volatility and","page_number":423,"box":{"x":117,"y":754,"width":731,"height":12}},{"id":"2c4e871b-b276-4b8f-86bb-bde0234aa81b","block_type":"box","text":"disruptions in liquidity for instruments that rely on or are impacted by such benchmarks. Additionally,","page_number":423,"box":{"x":116,"y":769,"width":743,"height":12}},{"id":"60146808-a1e4-4dfe-b90a-92e6a7048df8","block_type":"box","text":"there could be other consequences which cannot be predicted.","page_number":423,"box":{"x":116,"y":785,"width":466,"height":12}},{"id":"7e5872bc-cc17-47cc-9f13-7e0628279ebb","block_type":"box","text":"Repurchase Agreements and Purchase and Sale Contracts.","page_number":423,"box":{"x":116,"y":816,"width":456,"height":12}},{"id":"ac24cdf8-eb0f-4f98-8039-bc9fed58b312","block_type":"box","text":"Under repurchase agreements and","page_number":423,"box":{"x":578,"y":816,"width":249,"height":12}},{"id":"417b2ec4-a017-4324-8a95-33463631f813","block_type":"box","text":"purchase and sale contracts, the other party agrees","page_number":423,"box":{"x":117,"y":831,"width":366,"height":12}},{"id":"d03f1ecc-538a-4010-af78-70b007408546","block_type":"box","text":", upon entering into the contract with a Fund, to","page_number":423,"box":{"x":485,"y":831,"width":339,"height":12}},{"id":"ef53d7d9-fca3-40eb-a6f9-a0dde1d6d562","block_type":"box","text":"repurchase a security sold to the Fund at a mutua","page_number":423,"box":{"x":117,"y":847,"width":353,"height":12}},{"id":"d42d10be-6bbb-4d69-951d-537b79becccd","block_type":"box","text":"lly agreed-upon time and price in a specified currency,","page_number":423,"box":{"x":471,"y":847,"width":388,"height":12}},{"id":"809157c1-0279-469f-932c-37351da2b95d","block_type":"box","text":"thereby determining the yield dur","page_number":423,"box":{"x":116,"y":862,"width":234,"height":12}},{"id":"f400ce96-315f-461e-ad21-4573ee001f8a","block_type":"box","text":"ing the term of the agreement.","page_number":423,"box":{"x":351,"y":862,"width":219,"height":12}},{"id":"dd0730ad-c2a1-4c90-9718-4a8cc1e613a1","block_type":"box","text":"II-91","page_number":423,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"58ef22ca-4630-408b-abe4-0f8f22d0c93e","block_type":"box","text":"NM1026U-6004382-423/605","page_number":423,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"369ca8d1-8356-45b3-9df5-07e1a5e5175a","block_type":"box","text":"A purchase and sale contract differs from a repurchase agreement in that the contract arrangements","page_number":424,"box":{"x":116,"y":87,"width":751,"height":12}},{"id":"72934646-6ca6-4332-983a-58c6621eaeba","block_type":"box","text":"stipulate that securities are owned by the Fund and the purchaser receives any interest on the security","page_number":424,"box":{"x":116,"y":103,"width":766,"height":12}},{"id":"706508bd-d9ad-4040-bec7-16c3565d3a1e","block_type":"box","text":"paid during the period. In the case of repurchase agreements, the prices at which the trades are","page_number":424,"box":{"x":117,"y":118,"width":717,"height":12}},{"id":"43cbcfbd-b863-4164-8494-ed8b66ccf6a7","block_type":"box","text":"conducted do not reflect accrued interest on the underlying obligation; whereas, in the case of","page_number":424,"box":{"x":116,"y":134,"width":701,"height":12}},{"id":"a72fe161-6733-462b-bb8e-88d4937ddbba","block_type":"box","text":"purchase and sale contracts, the prices take into account accrued interest. A Fund may enter into","page_number":424,"box":{"x":117,"y":149,"width":728,"height":12}},{"id":"bd1df101-a128-4f60-8276-1936cdb64098","block_type":"box","text":"“tri-party” repurchase agreements. In “tri-party” repurchase agreements, an unaffiliated third-party","page_number":424,"box":{"x":116,"y":165,"width":729,"height":12}},{"id":"d4ea322c-be3d-4941-8317-3b7783ba76ff","block_type":"box","text":"custodian maintains accounts to hold collateral for the Fund and its counterparties and, therefore, the","page_number":424,"box":{"x":116,"y":180,"width":756,"height":12}},{"id":"c9de2fa8-7829-4106-8809-d4bdbd35f826","block_type":"box","text":"Fund may be subject to the credit risk of those custodians.","page_number":424,"box":{"x":117,"y":196,"width":438,"height":12}},{"id":"eb9c2afa-0d4f-41a7-a115-1402217bd4a6","block_type":"box","text":"Some repurchase agreements and purchase and sale contracts are structured to result in a fixed rate","page_number":424,"box":{"x":116,"y":227,"width":758,"height":12}},{"id":"875bf6e4-ec92-4d8f-acc6-2c573603188a","block_type":"box","text":"of return insulated from market fluctuations during the term of the agreement, although such return","page_number":424,"box":{"x":116,"y":242,"width":737,"height":12}},{"id":"8fb4117e-0b09-4c14-a99c-14cde1254141","block_type":"box","text":"may be affected by currency fluctuations. However, in the event of a default under a repurchase","page_number":424,"box":{"x":117,"y":258,"width":716,"height":12}},{"id":"ebfbf54e-e894-4715-96d5-3918ceacd262","block_type":"box","text":"agreement or under a purchase and sale contract, instead of the contractual fixed rate, the rate of","page_number":424,"box":{"x":116,"y":273,"width":730,"height":12}},{"id":"52b7c9b9-e7dd-47a7-8048-9fb18457a9b4","block_type":"box","text":"return to the Fund would be dependent upon intervening fluctuations of the market values of the","page_number":424,"box":{"x":117,"y":289,"width":716,"height":12}},{"id":"7dd73cf1-5814-4ac5-b730-857dadfe77e6","block_type":"box","text":"securities underlying the contract and the accrued interest on those securities. In such event, the Fund","page_number":424,"box":{"x":116,"y":304,"width":766,"height":12}},{"id":"03f4e5b9-7f6a-4200-ab15-31308b92a3c2","block_type":"box","text":"would have rights against the seller for breach of contract with respect to any losses arising from","page_number":424,"box":{"x":116,"y":320,"width":721,"height":12}},{"id":"643dcd6c-5947-4afe-a002-e639a299eef2","block_type":"box","text":"market fluctuations following the default.","page_number":424,"box":{"x":117,"y":335,"width":303,"height":12}},{"id":"d266072d-a75b-4fc9-ba1a-b929714d2dba","block_type":"box","text":"Both types of agreement usually cover short periods, such as less than one week, although they may","page_number":424,"box":{"x":117,"y":366,"width":747,"height":12}},{"id":"295e89d0-b35d-4df6-9264-e4c154ac2171","block_type":"box","text":"have longer terms, and may be construed to be collateralized loans by the purchaser to the seller","page_number":424,"box":{"x":117,"y":382,"width":718,"height":12}},{"id":"04687858-862a-41e6-b969-059c2d2f64b3","block_type":"box","text":"secured by the securities transferred to the purchaser. In the case of a repurchase agreement, as a","page_number":424,"box":{"x":116,"y":397,"width":735,"height":12}},{"id":"6362a4fa-15f5-471e-b238-be1dd80e88f4","block_type":"box","text":"purchaser, a Fund’s Manager or sub-adviser will monitor the creditworthiness of the seller, and a Fund","page_number":424,"box":{"x":117,"y":413,"width":756,"height":12}},{"id":"7e3653f2-6d19-4228-b7ba-2c0e9f9463d3","block_type":"box","text":"will require the seller to provide additional collateral if the market value of the securities falls below the","page_number":424,"box":{"x":116,"y":428,"width":753,"height":12}},{"id":"e6b8e81f-0e74-418c-bfa7-880c64b2966f","block_type":"box","text":"repurchase price at any time during the term of the repurchase agreement. The Fund does not have this","page_number":424,"box":{"x":117,"y":444,"width":769,"height":12}},{"id":"9d35c673-0a19-4f66-bb6f-73b6d417ca7c","block_type":"box","text":"right to seek additional collateral as a purchaser in the case of purchase and sale contracts. The Fund’s","page_number":424,"box":{"x":117,"y":459,"width":765,"height":12}},{"id":"7f727a45-d014-494d-b3b5-dc3135d8296e","block_type":"box","text":"Manager or sub-adviser will mark-to-market daily the value of the securities. Securities subject to","page_number":424,"box":{"x":117,"y":475,"width":715,"height":12}},{"id":"596e6c93-3d7a-47f3-8c87-b491d866a58f","block_type":"box","text":"repurchase agreements (other than tri-party repurchase agreements) and purchase and sale contracts","page_number":424,"box":{"x":117,"y":490,"width":757,"height":12}},{"id":"8c75fb1c-d377-48ad-b3d4-fc0714f6dc93","block_type":"box","text":"will be held by the Fund’s custodian (or sub-custodian) in the Federal Reserve/Treasury book-entry","page_number":424,"box":{"x":116,"y":506,"width":733,"height":12}},{"id":"c1fd0d04-ac7a-4b67-b967-a4682593238f","block_type":"box","text":"system or by another authorized securities depository.","page_number":424,"box":{"x":116,"y":521,"width":403,"height":12}},{"id":"cc298338-d19b-4123-a589-f8b446859a14","block_type":"box","text":"In the event of default by the seller under a repurchase agreement construed to be a collateralized loan,","page_number":424,"box":{"x":117,"y":552,"width":750,"height":12}},{"id":"d5361e95-89a7-4161-9677-c2cb0e066e45","block_type":"box","text":"the underlying securities are not owned by the Fund but only constitute collateral for the seller’s obligation","page_number":424,"box":{"x":116,"y":568,"width":763,"height":12}},{"id":"bb92e4bf-2e49-461e-94c2-7abffe7a4279","block_type":"box","text":"to pay the repurchase price. Therefore, the Fund may suffer time delays and incur costs or possible losses","page_number":424,"box":{"x":116,"y":583,"width":770,"height":12}},{"id":"a3a75fe5-f637-47c4-8b61-d9faf91d715e","block_type":"box","text":"in connection with disposition of the collateral. If the seller becomes insolvent and subject to liquidation or","page_number":424,"box":{"x":117,"y":599,"width":759,"height":12}},{"id":"db665bf5-6432-4f17-a9fa-25174a3fe471","block_type":"box","text":"reorganization under applicable bankruptcy or other laws, a Fund’s ability to dispose of the underlying","page_number":424,"box":{"x":117,"y":614,"width":733,"height":12}},{"id":"ccc84160-90d8-4a16-bbea-6ec065f43139","block_type":"box","text":"securities may be restricted. Finally, it is possible that a Fund may not be able to substantiate its interest in","page_number":424,"box":{"x":116,"y":630,"width":769,"height":12}},{"id":"cef623cb-7225-423b-b935-b6d8e3a18dbe","block_type":"box","text":"the underlying securities. To minimize this risk, the securities underlying the repurchase agreement will be","page_number":424,"box":{"x":116,"y":645,"width":766,"height":12}},{"id":"5c480442-903f-4946-8a3f-9480366c3aee","block_type":"box","text":"held by the applicable custodian at all times in an amount at least equal to the repurchase price, including","page_number":424,"box":{"x":117,"y":661,"width":756,"height":12}},{"id":"37b66c02-27b8-4a35-b0de-4923281420ea","block_type":"box","text":"accrued interest. If the seller fails to repurchase the securities, a Fund may suffer a loss to the extent","page_number":424,"box":{"x":116,"y":676,"width":723,"height":12}},{"id":"cf7f74e6-2729-4fb1-a990-808863c3aefe","block_type":"box","text":"proceeds from the sale of the underlying securities are less than the repurchase price.","page_number":424,"box":{"x":117,"y":692,"width":616,"height":12}},{"id":"c9bdf38c-b39b-4b27-9f01-dc0ac1ff07ca","block_type":"box","text":"In any repurchase transaction to which a Fund is a party, collateral for a repurchase agreement may include","page_number":424,"box":{"x":117,"y":723,"width":765,"height":12}},{"id":"03b272be-3def-4628-a20e-ce8d28066c58","block_type":"box","text":"cash items and obligations issued by the U.S. Governm","page_number":424,"box":{"x":116,"y":738,"width":395,"height":12}},{"id":"14bc5a54-d88f-4ee5-8e90-12754474659b","block_type":"box","text":"ent or its agencies or instrumentalities. For certain","page_number":424,"box":{"x":512,"y":738,"width":353,"height":12}},{"id":"31e8658b-c325-4785-922d-6a033d8f6f24","block_type":"box","text":"Funds, however, collateral may include instruments other","page_number":424,"box":{"x":117,"y":754,"width":406,"height":12}},{"id":"20d95c54-427e-4a73-8ead-e9405218763d","block_type":"box","text":"than cash items and obligations issued by the","page_number":424,"box":{"x":527,"y":754,"width":324,"height":12}},{"id":"c00e339e-1595-41f6-b421-a6a9d66de2d0","block_type":"box","text":"U.S. Government or its agencies or instrumentalitie","page_number":424,"box":{"x":117,"y":769,"width":362,"height":12}},{"id":"f6e9d802-5b96-4d12-9dd5-0140760fd311","block_type":"box","text":"s, including securities that the Fund could not hold","page_number":424,"box":{"x":480,"y":769,"width":354,"height":12}},{"id":"fc510070-32be-4144-aea7-276c6d7afbd6","block_type":"box","text":"directly under its investment strategi","page_number":424,"box":{"x":116,"y":785,"width":255,"height":12}},{"id":"4c074934-7412-4033-8cf1-e4349724fdb0","block_type":"box","text":"es without the repurchase obligation.","page_number":424,"box":{"x":372,"y":785,"width":260,"height":12}},{"id":"2d44be45-7701-416d-bf36-9fda8ecb6097","block_type":"box","text":"The type of collateral underlying repurchase agreement","page_number":424,"box":{"x":116,"y":816,"width":394,"height":12}},{"id":"7d334277-2860-4a84-ac26-e493dee5841f","block_type":"box","text":"s may also pose certain risks for a Fund. Lower","page_number":424,"box":{"x":511,"y":816,"width":337,"height":12}},{"id":"02894b76-9360-402d-bd53-1feec44b61c9","block_type":"box","text":"quality collateral and collateral with longer maturities may","page_number":424,"box":{"x":116,"y":831,"width":410,"height":12}},{"id":"238f6323-800b-4b63-8503-ccb8ded49c6e","block_type":"box","text":"be subject to greater price fluctuations than higher","page_number":424,"box":{"x":526,"y":831,"width":360,"height":12}},{"id":"546ce695-9b0a-4b33-b3b6-7d5d46404bdc","block_type":"box","text":"quality collateral and collateral with shorter maturities","page_number":424,"box":{"x":116,"y":847,"width":375,"height":12}},{"id":"4b8332b1-6340-4767-b309-cd68156c70e0","block_type":"box","text":". If the repurchase agreement counterparty were to","page_number":424,"box":{"x":493,"y":847,"width":365,"height":12}},{"id":"35bda43a-8184-42f2-81f9-45f3505c7902","block_type":"box","text":"default, lower quality collateral may be more difficult t","page_number":424,"box":{"x":116,"y":862,"width":371,"height":12}},{"id":"260dd2b6-ddc8-4375-846b-3f2ff9373846","block_type":"box","text":"to liquidate than higher quality collateral. Should the","page_number":424,"box":{"x":487,"y":862,"width":371,"height":12}},{"id":"5b4bdd16-dd04-4091-9872-fac640cfd873","block_type":"box","text":"counterparty default and the amount of collateral not be","page_number":424,"box":{"x":116,"y":878,"width":398,"height":12}},{"id":"7275b194-256b-443b-9a55-fa247ceb7ff0","block_type":"box","text":"sufficient to cover the counterparty’s repurchase","page_number":424,"box":{"x":515,"y":878,"width":346,"height":12}},{"id":"1e29387d-5fcb-4dc6-b06d-7c04828c6f82","block_type":"box","text":"II-92","page_number":424,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"740d4ecd-e409-4b62-9de3-10c591eb2108","block_type":"box","text":"NM1026U-6004382-424/605","page_number":424,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a59868ed-7c1f-408d-9d93-c58eba7f9b0c","block_type":"box","text":"obligation, a Fund would retain the status of","page_number":425,"box":{"x":116,"y":87,"width":311,"height":12}},{"id":"66074311-5e81-4b1c-a6e9-7f7fdbdd05fa","block_type":"box","text":"f an unsecured creditor of the counterparty (","page_number":425,"box":{"x":426,"y":87,"width":308,"height":12}},{"id":"0381264d-ed4b-4380-ba1c-a4637d697326","block_type":"box","text":"i.e.","page_number":425,"box":{"x":735,"y":87,"width":19,"height":10}},{"id":"31680607-d68e-4455-8876-4c1588d3088e","block_type":"box","text":", the position the","page_number":425,"box":{"x":757,"y":87,"width":121,"height":12}},{"id":"4ffbd19c-2448-49ab-99a9-7165cc69396d","block_type":"box","text":"Fund would normally be in if it were to hold, pursuant","page_number":425,"box":{"x":117,"y":102,"width":375,"height":13}},{"id":"2a11b6e3-6ef2-4cf9-adcb-8b8173574f3a","block_type":"box","text":"t to its investment policies, other unsecured debt","page_number":425,"box":{"x":491,"y":103,"width":344,"height":11}},{"id":"fa6f9a86-b7e1-4b9e-ad67-8d92abf9a760","block_type":"box","text":"securities of the defaulting counterparty) with respect","page_number":425,"box":{"x":116,"y":118,"width":371,"height":12}},{"id":"60d03d35-4460-4e52-82f3-f2a0cb3794cd","block_type":"box","text":"ct to the amount of the shortfall. As an unsecured","page_number":425,"box":{"x":487,"y":118,"width":347,"height":10}},{"id":"ebfa29db-0360-415b-b4d2-6cdecca258c9","block_type":"box","text":"creditor, a Fund would be at risk of losing some or all of","page_number":425,"box":{"x":116,"y":134,"width":394,"height":12}},{"id":"b262cdb0-6a0e-4dc6-8712-28213c9f70c0","block_type":"box","text":"f the principal and income involved in the transaction.","page_number":425,"box":{"x":509,"y":134,"width":378,"height":11}},{"id":"47eed1e8-c3ef-4c65-8aaa-81b1ed9d29f7","block_type":"box","text":"Regulations adopted by global prudential regulators require certain bank-regulated counterparties and","page_number":425,"box":{"x":117,"y":165,"width":761,"height":12}},{"id":"70eb4ad2-6f05-4816-b1db-733675177b48","block_type":"box","text":"certain of their affiliates to include in certain financial contracts, including many repurchase agreements","page_number":425,"box":{"x":116,"y":180,"width":771,"height":12}},{"id":"7a8c5d97-d7e6-4bec-b13d-d0327738667e","block_type":"box","text":"and purchase and sale contracts, terms that delay or restrict the rights of counterparties, such as a","page_number":425,"box":{"x":116,"y":196,"width":738,"height":12}},{"id":"c7ee543f-5152-4553-8f07-556751dbea9e","block_type":"box","text":"Fund, to terminate such agreements, take foreclosure action, exercise other default rights or restrict","page_number":425,"box":{"x":117,"y":211,"width":744,"height":12}},{"id":"05ebfa51-70d1-446f-9212-052ec260a6da","block_type":"box","text":"transfers of credit support in the event that the counterparty and/or its affiliates are subject to certain","page_number":425,"box":{"x":116,"y":227,"width":748,"height":12}},{"id":"d345fda7-5837-4402-bbf5-80fd3eb293dd","block_type":"box","text":"types of resolution or insolvency proceedings. It is possible that these requirements, as well as","page_number":425,"box":{"x":116,"y":242,"width":707,"height":12}},{"id":"3cc9e9a8-5562-4734-91cf-3d0ee26001aa","block_type":"box","text":"potential additional government regulation and other developments in the market, could adversely","page_number":425,"box":{"x":117,"y":258,"width":729,"height":12}},{"id":"6a2d8d04-7f93-4511-8b8b-1176eeceb1e3","block_type":"box","text":"affect a Fund’s ability to terminate existing repurchase agreements and purchase and sale contracts or","page_number":425,"box":{"x":116,"y":273,"width":768,"height":12}},{"id":"b5d2f594-f877-45ad-866f-893f1398ac51","block_type":"box","text":"to realize amounts to be received under such agreements. The SEC has also finalized rules that will","page_number":425,"box":{"x":116,"y":289,"width":747,"height":12}},{"id":"f46f6153-8726-405a-9a8a-cb6d528485ee","block_type":"box","text":"require certain transactions involving U.S. Treasuries, including repurchase agreements, to be centrally","page_number":425,"box":{"x":117,"y":304,"width":770,"height":12}},{"id":"fd9899f2-bcbc-45d6-a78b-83191bf6720b","block_type":"box","text":"cleared. Compliance with these rules is expected to be required by the middle of 2027. Although the","page_number":425,"box":{"x":116,"y":320,"width":747,"height":12}},{"id":"e0d4f33a-80a7-496a-9718-9ef644a62f14","block_type":"box","text":"impact of these rules on the Funds is difficult to predict, they may reduce the availability or increase the","page_number":425,"box":{"x":117,"y":335,"width":770,"height":12}},{"id":"9d48c6d1-c022-4dce-b4d8-a2cba4cd7be2","block_type":"box","text":"costs of such transactions and may adversely affect a Fund’s performance.","page_number":425,"box":{"x":116,"y":351,"width":563,"height":12}},{"id":"57d7f696-fab6-4ae1-9871-271fab9f85fd","block_type":"box","text":"Restricted Securities.","page_number":425,"box":{"x":116,"y":382,"width":177,"height":9}},{"id":"c680ad54-9ac5-4222-9061-3a5d08b2f492","block_type":"box","text":"A Fund may invest in or hold securities that are not registered under the","page_number":425,"box":{"x":293,"y":382,"width":539,"height":12}},{"id":"248efaed-06fc-433e-89ce-20d92c20230d","block_type":"box","text":"Securities Act (“restricted securities”), which may include securities in private companies and","page_number":425,"box":{"x":116,"y":397,"width":694,"height":12}},{"id":"5c0871ab-0fdc-433e-a190-a815bdb46d8c","block_type":"box","text":"Rule 144A Securities. Restricted securities may be sold in private placement transactions between","page_number":425,"box":{"x":117,"y":413,"width":736,"height":12}},{"id":"7a51bcb7-6403-4934-9f42-a4484ab0a2a5","block_type":"box","text":"issuers and their purchasers, including through private negotiated transactions between the issuer and","page_number":425,"box":{"x":117,"y":428,"width":765,"height":12}},{"id":"c775b6b3-b6fb-4ce6-80c7-6d9a3e56d6b8","block_type":"box","text":"their purchasers, such as the Funds, and may be neither listed on an exchange nor traded in other","page_number":425,"box":{"x":116,"y":444,"width":736,"height":12}},{"id":"91e8d350-337a-4582-b80a-8393e5a1d08d","block_type":"box","text":"established markets. In many cases, privately placed securities may not be freely transferable under","page_number":425,"box":{"x":116,"y":459,"width":749,"height":12}},{"id":"85ea4737-eb91-4a99-9d11-57c7df48d9a8","block_type":"box","text":"the laws of the applicable jurisdiction or due to contractual restrictions on resale. Some of these","page_number":425,"box":{"x":116,"y":475,"width":714,"height":12}},{"id":"651071e5-5854-4dfd-a5fa-4b27596396f0","block_type":"box","text":"securities are new and complex, and trade only among institutions; the markets for these securities are","page_number":425,"box":{"x":116,"y":490,"width":769,"height":12}},{"id":"4c2800d1-f6f0-4f04-ba89-a223aadba489","block_type":"box","text":"still developing and may not function as efficiently as established markets. Typically, investments in","page_number":425,"box":{"x":116,"y":506,"width":742,"height":12}},{"id":"742c0fea-06e9-4ac2-8329-a94a79eca218","block_type":"box","text":"private companies are in restricted securities that are not traded in public markets and subject to","page_number":425,"box":{"x":117,"y":521,"width":719,"height":12}},{"id":"34afe283-5d23-46c8-ad04-4878c4bf5570","block_type":"box","text":"substantial holding periods, so that a Fund may not be able to resell some of its holdings for extended","page_number":425,"box":{"x":116,"y":537,"width":760,"height":12}},{"id":"fd2e9146-58b9-4521-98a7-e37b12ad3fc2","block_type":"box","text":"periods, which may be several years. There can be no assurance that a Fund will be able to realize the","page_number":425,"box":{"x":117,"y":552,"width":769,"height":12}},{"id":"7f4be876-64de-425b-bf5e-267acb5ca97e","block_type":"box","text":"value of such restricted securities in a timely manner or at all. As a result of the absence of a public","page_number":425,"box":{"x":116,"y":568,"width":741,"height":12}},{"id":"ffa7c1f6-f3dd-42d4-9b19-a784ad2e89f5","block_type":"box","text":"trading market and the potential bespoke nature on certain transactions, restricted securities may be","page_number":425,"box":{"x":116,"y":583,"width":750,"height":12}},{"id":"4cb40ef0-d202-4d5a-ba26-02c839f4b377","block_type":"box","text":"deemed to be illiquid investments or less liquid investments and may be more difficult to value than","page_number":425,"box":{"x":116,"y":599,"width":740,"height":12}},{"id":"c329a995-ac50-4683-87a2-1bdbe6f5b33b","block_type":"box","text":"publicly traded securities. To the extent that restricted securities may be resold in privately negotiated","page_number":425,"box":{"x":117,"y":614,"width":757,"height":12}},{"id":"6a2374e9-427d-45c7-98d3-6631016f77f3","block_type":"box","text":"transactions, the prices realized from the sales, due to lack of liquidity, could be less than those","page_number":425,"box":{"x":116,"y":630,"width":713,"height":12}},{"id":"a2a8341c-2a29-41b2-90d2-5e7a1f6aeedd","block_type":"box","text":"originally paid by the Fund or less than their fair market value. The amount of any discount may vary","page_number":425,"box":{"x":116,"y":645,"width":749,"height":12}},{"id":"a8de3b2c-1b91-48fe-9371-c03b827a0274","block_type":"box","text":"depending on the security type, the character of the issuer, which party (if any) will bear the expenses","page_number":425,"box":{"x":116,"y":661,"width":754,"height":12}},{"id":"e913029b-a461-4ded-9505-94f2e8cc2500","block_type":"box","text":"of registering the restricted security, and prevailing market conditions. In addition, issuers whose","page_number":425,"box":{"x":116,"y":676,"width":715,"height":12}},{"id":"30ecb8fb-82b4-498c-a8fb-b1c985f4d7f8","block_type":"box","text":"securities are not publicly traded or who are not otherwise publicly listed may not be subject to the","page_number":425,"box":{"x":116,"y":692,"width":727,"height":12}},{"id":"7657620c-e2b8-4d9b-bcec-e4f2e045ad9f","block_type":"box","text":"disclosure and other investor protection requirements that may be applicable if their securities were","page_number":425,"box":{"x":116,"y":707,"width":736,"height":12}},{"id":"689677a2-7064-4581-a4a6-76a13c876164","block_type":"box","text":"publicly traded. If any privately placed securities held by a Fund are required to be registered under the","page_number":425,"box":{"x":117,"y":723,"width":764,"height":12}},{"id":"9de47352-914a-4622-ab02-36478e2c1aa6","block_type":"box","text":"securities laws of one or more jurisdictions before being resold, the Fund may be required to bear the","page_number":425,"box":{"x":116,"y":738,"width":751,"height":12}},{"id":"2aa4fb22-bc03-4d88-8dfa-1f99c6fc0b11","block_type":"box","text":"expenses of registration. Where registration is required for restricted securities, a considerable time","page_number":425,"box":{"x":116,"y":754,"width":738,"height":12}},{"id":"d1dbcc6c-02f5-4e90-a72d-0f105960472e","block_type":"box","text":"period may elapse between the time the Fund decides to sell the security and the time it is actually","page_number":425,"box":{"x":117,"y":769,"width":731,"height":12}},{"id":"73c2ea35-38cd-4eba-8ff0-67ee25171076","block_type":"box","text":"permitted to sell the security under an effective registration statement. If during such period, adverse","page_number":425,"box":{"x":117,"y":785,"width":744,"height":12}},{"id":"359d9da3-2672-4830-bdef-8307142103fb","block_type":"box","text":"market conditions were to develop, the Fund might obtain less favorable pricing terms than when it","page_number":425,"box":{"x":117,"y":800,"width":731,"height":12}},{"id":"00ae5c60-8f76-4026-8d14-5f57edea1464","block_type":"box","text":"decided to sell the security. In addition, the Fund may be deemed to be an “underwriter” for purposes","page_number":425,"box":{"x":116,"y":816,"width":750,"height":12}},{"id":"d3fe8fb9-30b7-4a08-b94b-6daa3fa6ab6b","block_type":"box","text":"of the Securities Act when selling restricted securities. If so, the Fund may be liable to purchasers of","page_number":425,"box":{"x":116,"y":831,"width":747,"height":12}},{"id":"01c24d2e-ad06-4d27-888b-50ebc7a2d7d8","block_type":"box","text":"the restricted securities if the registration statement prepared by the issuer, or the corresponding","page_number":425,"box":{"x":116,"y":847,"width":722,"height":12}},{"id":"828fbdc9-02f1-4172-a198-9617005351ff","block_type":"box","text":"prospectus, is materially inaccurate or misleading. Transactions in restricted securities may entail other","page_number":425,"box":{"x":117,"y":862,"width":769,"height":12}},{"id":"90d93fd6-afcd-47d1-9057-c06223a4a1c6","block_type":"box","text":"transaction costs that are higher than those for transactions in unrestricted securities. Certain of the","page_number":425,"box":{"x":116,"y":878,"width":744,"height":12}},{"id":"cad48673-85d4-4055-a1ff-76b8b7011450","block_type":"box","text":"II-93","page_number":425,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"f1ab2dbc-931a-476d-a4f0-380e7504838c","block_type":"box","text":"NM1026U-6004382-425/605","page_number":425,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"e9b2e810-6764-415b-ba5e-f764e12aba74","block_type":"box","text":"Fund’s investments in private placements may consist of direct investments and may include","page_number":426,"box":{"x":117,"y":87,"width":692,"height":12}},{"id":"02c40a9b-1c4a-4cba-9a24-b2c12490e73b","block_type":"box","text":"investments in smaller, less seasoned issuers, which may involve greater risks. Issuers of restricted","page_number":426,"box":{"x":117,"y":102,"width":744,"height":13}},{"id":"088837a2-2592-4895-8e2f-392b2aceb913","block_type":"box","text":"securities may not be subject to SEC reporting requirements, may not be required to maintain their","page_number":426,"box":{"x":116,"y":118,"width":737,"height":12}},{"id":"bdc88053-41e3-4780-99ba-1e5c52a43070","block_type":"box","text":"accounting records in accordance with generally accepted accounting principles, and may not be","page_number":426,"box":{"x":116,"y":134,"width":724,"height":12}},{"id":"3364ad9e-f8f6-4250-b055-e5dd966ba006","block_type":"box","text":"required to maintain effective internal controls over financial reporting. As a result, BlackRock may not","page_number":426,"box":{"x":117,"y":149,"width":760,"height":12}},{"id":"43aea504-2a5b-43d1-998a-f85c4cdb6d4a","block_type":"box","text":"have timely or accurate information about the business, financial condition and results of operations of","page_number":426,"box":{"x":117,"y":165,"width":762,"height":12}},{"id":"f688b696-6218-48e1-8b84-e391d98e10b8","block_type":"box","text":"such issuers, and investments in securities of such issuers may involve a high degree of business and","page_number":426,"box":{"x":116,"y":180,"width":764,"height":12}},{"id":"0257c757-f244-44fd-8430-7794457a7e45","block_type":"box","text":"financial risk and may result in substantial losses to the Fund. Such issuers may also have limited","page_number":426,"box":{"x":116,"y":196,"width":729,"height":12}},{"id":"4696a4f4-0adf-4f15-9e5a-b67e2e99e316","block_type":"box","text":"product lines, markets or financial resources, or they may be dependent on a limited management","page_number":426,"box":{"x":117,"y":211,"width":731,"height":12}},{"id":"54df5801-5936-4995-86bc-e26ca2cfb563","block_type":"box","text":"group.","page_number":426,"box":{"x":116,"y":229,"width":52,"height":10}},{"id":"4810be5a-8210-4d57-b404-3bbec2687f53","block_type":"box","text":"Certain restricted securities may represent limited investment opportunities and each shareholder’s","page_number":426,"box":{"x":117,"y":258,"width":740,"height":12}},{"id":"3c7f5e12-20b8-442e-b0c1-b3bd28133694","block_type":"box","text":"proportionate investment exposure to such limited investment opportunities may be reduced","page_number":426,"box":{"x":117,"y":273,"width":687,"height":12}},{"id":"40efc381-ad05-48b9-8677-88dde12b48c1","block_type":"box","text":"proportionately as the Fund’s net assets grow from new or additional investments made in the Fund by","page_number":426,"box":{"x":117,"y":289,"width":766,"height":12}},{"id":"3cd09785-19f0-4470-b7c5-6d6bb3e7ada5","block_type":"box","text":"other shareholders. The issuer of a private placement may later register those shares for public sale in","page_number":426,"box":{"x":116,"y":304,"width":765,"height":12}},{"id":"637f9e06-409c-4890-8811-623e3f7308fc","block_type":"box","text":"an IPO, but there is no guarantee that an IPO will ever be completed. Even after an IPO, there may be","page_number":426,"box":{"x":116,"y":320,"width":766,"height":12}},{"id":"fd2e6754-510b-491c-aeb2-88a05c5439a0","block_type":"box","text":"a limited trading market for securities of that issuer, including any direct investment by a Fund, or the","page_number":426,"box":{"x":116,"y":335,"width":752,"height":12}},{"id":"0e82c78a-93bb-4e96-8b40-ab214f000c3f","block_type":"box","text":"Fund may be subject to contractual limitations on its ability to resell its existing securities following an","page_number":426,"box":{"x":117,"y":351,"width":754,"height":12}},{"id":"45c53836-8b63-4d91-9f05-25daba9697c6","block_type":"box","text":"IPO. The inability of an applicable issuer of a restricted security to complete an IPO or offer other","page_number":426,"box":{"x":117,"y":366,"width":723,"height":12}},{"id":"a70452a5-01b7-4fe4-8c52-3ba9df17944c","block_type":"box","text":"liquidity opportunities to the Fund and other investors will extend the holding period of a Fund’s","page_number":426,"box":{"x":117,"y":382,"width":708,"height":12}},{"id":"b23eb284-6dd5-49ff-808d-385119d0b668","block_type":"box","text":"investments, potentially indefinitely, and may adversely affect the value of the investments. In making","page_number":426,"box":{"x":117,"y":397,"width":756,"height":12}},{"id":"0919e194-a96b-4b39-aa4b-8562e4e9372c","block_type":"box","text":"investments in such securities, a Fund may obtain access to material nonpublic information, which may","page_number":426,"box":{"x":117,"y":413,"width":770,"height":12}},{"id":"be160551-7ca2-4cf9-be63-dad67cd848d2","block_type":"box","text":"restrict the Fund’s ability to conduct portfolio transactions in such securities. The activity of identifying,","page_number":426,"box":{"x":117,"y":428,"width":759,"height":12}},{"id":"4df5d35d-e85f-47ee-8648-671b8e5078cb","block_type":"box","text":"completing, and realizing upon attractive investments in restricted securities is highly competitive and","page_number":426,"box":{"x":116,"y":444,"width":756,"height":12}},{"id":"187a9495-1e58-41f2-a42c-0e3aee8296ef","block_type":"box","text":"involves a high degree of uncertainty. A Fund will be competing for investments against other similarly","page_number":426,"box":{"x":117,"y":459,"width":761,"height":12}},{"id":"615c5049-a281-4ba4-a64b-0a7659741bd1","block_type":"box","text":"situated investors. It is possible that competition for appropriate investment opportunities may increase,","page_number":426,"box":{"x":116,"y":475,"width":772,"height":12}},{"id":"a29cecee-0a8d-4419-acc0-7563f4fcaf3f","block_type":"box","text":"thus potentially reducing the number of investment opportunities available to a Fund and adversely","page_number":426,"box":{"x":116,"y":490,"width":738,"height":12}},{"id":"17ca4fe8-8d99-4613-a833-50595fea4c44","block_type":"box","text":"affecting the terms upon which investments can be made. There is no assurance that investment","page_number":426,"box":{"x":116,"y":506,"width":724,"height":12}},{"id":"0350914b-687d-4c51-8239-4425bc32d5d0","block_type":"box","text":"opportunities for restricted securities will be available at any given time or at a level desired by a Fund,","page_number":426,"box":{"x":116,"y":521,"width":765,"height":12}},{"id":"676f0386-53bc-42b1-9dde-a457141bb0bb","block_type":"box","text":"especially as that Fund grows in size.","page_number":426,"box":{"x":116,"y":537,"width":283,"height":12}},{"id":"0f13c6d9-a436-4e40-bcf5-ad95f344117e","block_type":"box","text":"There may not be a readily available market value for a Fund’s restricted securities (in particular,","page_number":426,"box":{"x":116,"y":568,"width":722,"height":12}},{"id":"f3504381-259a-4eaf-9bd2-cb7681f50628","block_type":"box","text":"restricted securities issued by private companies), and thus may be considered “illiquid.” Each Fund","page_number":426,"box":{"x":117,"y":583,"width":745,"height":12}},{"id":"68ccfc0c-a307-45c5-9b46-35dd652dc397","block_type":"box","text":"values restricted securities in accordance with BlackRock’s valuation policies and procedures, which","page_number":426,"box":{"x":116,"y":599,"width":750,"height":12}},{"id":"9e964a71-50aa-4e4b-a279-46ecd3324736","block_type":"box","text":"are designed to value investments such that they accurately reflect fair value. Due to the inherent","page_number":426,"box":{"x":116,"y":614,"width":727,"height":12}},{"id":"f7dd0fd5-3f61-489a-9286-b0e7ca1c87ee","block_type":"box","text":"uncertainty and subjectivity of determining the fair value of investments that do not have a readily","page_number":426,"box":{"x":117,"y":630,"width":725,"height":12}},{"id":"d86ed01b-f8a0-4c91-a7d7-cec072b1e33c","block_type":"box","text":"available market value, the fair value of a Fund’s private investments may differ significantly from the","page_number":426,"box":{"x":116,"y":645,"width":752,"height":12}},{"id":"881d1c15-9097-4d20-8678-279497ea167d","block_type":"box","text":"values that would have been used had a readily available market value existed for such investments","page_number":426,"box":{"x":116,"y":661,"width":744,"height":12}},{"id":"508bf4fe-9bff-498c-853c-a8b8f3d16021","block_type":"box","text":"and may differ materially from the amounts the Fund may realize on any dispositions of such","page_number":426,"box":{"x":116,"y":676,"width":686,"height":12}},{"id":"3bc289f6-8328-4454-b2ec-6ba3d653ee4a","block_type":"box","text":"investments. Differences in the value of the Fund’s private investments could result in the Fund’s","page_number":426,"box":{"x":117,"y":692,"width":717,"height":12}},{"id":"e20a78f6-dfa1-4dac-a1fa-71d8c10010bc","block_type":"box","text":"shareholder transactions being effected at a NAV that does not accurately reflect the underlying value","page_number":426,"box":{"x":116,"y":707,"width":755,"height":12}},{"id":"cd862d09-a57c-403c-9b2c-839a4d21a9fe","block_type":"box","text":"of the Fund’s portfolio, potentially resulting in the dilution of shareholder interests and increasing","page_number":426,"box":{"x":116,"y":723,"width":712,"height":12}},{"id":"e8586cbc-57ff-4afc-8ebd-515b0e056072","block_type":"box","text":"opportunities for shareholder arbitrage. The values used by the Fund to price its restricted securities","page_number":426,"box":{"x":116,"y":738,"width":742,"height":12}},{"id":"f8ecb225-2e41-4329-bada-800625362c9d","block_type":"box","text":"may also differ from those used by other investment companies and investors to price the same","page_number":426,"box":{"x":117,"y":754,"width":710,"height":12}},{"id":"adac0c19-0b24-41e5-9f78-17f03dfca33b","block_type":"box","text":"restricted securities. In addition, the impact of changes in the market environment and other events on","page_number":426,"box":{"x":117,"y":769,"width":757,"height":12}},{"id":"90619aeb-1950-490e-8d0b-92f7d169a6d4","block_type":"box","text":"the fair values of a Fund’s investments that have no readily available market values may differ from the","page_number":426,"box":{"x":116,"y":785,"width":764,"height":12}},{"id":"63e76fd2-5d50-4d49-90da-342da0a490cf","block_type":"box","text":"impact of such changes on the readily available market values for the Fund’s other investments. A","page_number":426,"box":{"x":117,"y":800,"width":728,"height":12}},{"id":"784216e8-aef5-4d1e-982b-a78d1d47bee9","block_type":"box","text":"Fund’s NAV could be adversely affected if the Fund’s determinations regarding the fair value of the","page_number":426,"box":{"x":117,"y":816,"width":733,"height":12}},{"id":"992ea56d-38c2-4e4a-9ca7-7dd9eef4c43b","block_type":"box","text":"Fund’s investments were materially higher than the investment’s actual market or fair value or the","page_number":426,"box":{"x":117,"y":831,"width":728,"height":12}},{"id":"fa231762-677d-408e-ad63-9d802ab8e643","block_type":"box","text":"values that the Fund ultimately realizes upon the disposal of such investments.","page_number":426,"box":{"x":116,"y":847,"width":590,"height":12}},{"id":"2bd0c574-6228-4c70-b93c-d1061906e977","block_type":"box","text":"See also risks discussed under “Illiquid Investments.”","page_number":426,"box":{"x":116,"y":878,"width":400,"height":12}},{"id":"5460e690-8977-468b-8aa8-1d3f96cd7fb8","block_type":"box","text":"II-94","page_number":426,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"b177a0e3-3853-4138-a068-e7ac73b76b52","block_type":"box","text":"NM1026U-6004382-426/605","page_number":426,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"04bab8b1-d6dd-403f-bdd8-5a12ea151af3","block_type":"box","text":"Reverse Repurchase Agreements.","page_number":427,"box":{"x":116,"y":87,"width":257,"height":12}},{"id":"035a0738-a6ee-43fa-9d67-78fe1de459d0","block_type":"box","text":"A Fund may enter into reverse re","page_number":427,"box":{"x":373,"y":87,"width":227,"height":12}},{"id":"f3fdd475-e734-49b8-8af2-4614e6320734","block_type":"box","text":"repurchase agreements with the same","page_number":427,"box":{"x":600,"y":87,"width":267,"height":12}},{"id":"08471f35-79b6-449e-854e-83c77d9073c1","block_type":"box","text":"parties with whom it may enter into repurchase","page_number":427,"box":{"x":117,"y":103,"width":328,"height":12}},{"id":"4caa7765-11af-4715-be96-94fbc06076d3","block_type":"box","text":"agreements. Under a reverse repurchase agreement, a Fund","page_number":427,"box":{"x":445,"y":103,"width":431,"height":12}},{"id":"524540f9-5b37-4c1b-990e-c655e122ecd4","block_type":"box","text":"sells securities to another party and agrees to repurc","page_number":427,"box":{"x":116,"y":118,"width":358,"height":12}},{"id":"78fa6977-45f2-422a-87c0-0badc398063b","block_type":"box","text":"rchase them at a particular date and price. A Fund may","page_number":427,"box":{"x":473,"y":118,"width":383,"height":12}},{"id":"4c19c2a8-a2c8-43a0-8fee-5846e5bcca79","block_type":"box","text":"enter into a reverse repurchase agreement when it is","page_number":427,"box":{"x":116,"y":134,"width":372,"height":12}},{"id":"e7dcf22a-841f-4245-b79b-111785bb8755","block_type":"box","text":"anticipated that the interest income to be earned from","page_number":427,"box":{"x":488,"y":134,"width":376,"height":11}},{"id":"071b6cda-4a77-4074-966c-5c49269782cb","block_type":"box","text":"the investment of the proceeds of the transaction is","page_number":427,"box":{"x":116,"y":149,"width":359,"height":12}},{"id":"8f83ac83-5896-4021-aa2b-68227d6643c7","block_type":"box","text":"greater than the interest expense of the transaction.","page_number":427,"box":{"x":475,"y":149,"width":363,"height":12}},{"id":"02a04642-a665-4124-a36c-6502f6ddd320","block_type":"box","text":"The use of reverse repurchase agreements may be regarded as leveraging and, therefore, speculative.","page_number":427,"box":{"x":116,"y":180,"width":772,"height":12}},{"id":"767ef3e2-1313-4f8e-a956-e8bd6716d5c6","block_type":"box","text":"Furthermore, reverse repurchase agreements involve the risks that (i) the interest income earned in the","page_number":427,"box":{"x":117,"y":196,"width":771,"height":12}},{"id":"32ad2816-bda1-4778-a5c6-c7978e282216","block_type":"box","text":"investment of the proceeds will be less than the interest expense, (ii) the market value of the securities","page_number":427,"box":{"x":117,"y":211,"width":765,"height":12}},{"id":"8032fdfc-7d94-4f69-8959-4b4be1769bd8","block_type":"box","text":"retained in lieu of sale by a Fund may decline below","page_number":427,"box":{"x":117,"y":227,"width":390,"height":12}},{"id":"5c032878-3570-4102-8da8-826744e2e20a","block_type":"box","text":"the price of the securities the Fund has sold but is","page_number":427,"box":{"x":507,"y":227,"width":375,"height":11}},{"id":"ddd209ba-82de-49b3-853b-f9159e074250","block_type":"box","text":"obligated to repurchase, (iii) the market value of the securities sold will decline below the price at which","page_number":427,"box":{"x":116,"y":242,"width":770,"height":12}},{"id":"4e12913d-646c-4388-aba1-946779b24a53","block_type":"box","text":"the Fund is required to repurchase them and (iv) the securities will not be returned to the Fund.","page_number":427,"box":{"x":116,"y":258,"width":710,"height":12}},{"id":"7111d965-22de-433d-82b0-ea84643c1443","block_type":"box","text":"In addition, if the buyer of securities under a reverse repurchase agreement files for bankruptcy or becomes","page_number":427,"box":{"x":117,"y":289,"width":759,"height":12}},{"id":"6f712806-068b-4c88-894d-ec71f2059fbe","block_type":"box","text":"insolvent, such buyer or its trustee or receiver may receive an extension of time to determine whether to","page_number":427,"box":{"x":117,"y":304,"width":732,"height":12}},{"id":"6d5d1ab3-c9ce-4907-8cf2-67998bf3f674","block_type":"box","text":"enforce a Fund’s obligations to repurchase the securities and the Fund’s use of the proceeds of the reverse","page_number":427,"box":{"x":116,"y":320,"width":758,"height":12}},{"id":"0f123c73-ea30-4a8c-a561-d8b588794233","block_type":"box","text":"repurchase agreement may effectively be restricted pending such decision.","page_number":427,"box":{"x":117,"y":335,"width":531,"height":12}},{"id":"c3ef64f3-ed2d-4a6a-9c7c-1ff32393fd40","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into reverse repurchase","page_number":427,"box":{"x":117,"y":366,"width":710,"height":12}},{"id":"c1a47c3e-7f46-445f-b148-b2e272f22bdd","block_type":"box","text":"agreements and similar financing transactions (e.g., recourse and non-recourse tender option bonds,","page_number":427,"box":{"x":116,"y":382,"width":755,"height":12}},{"id":"89ee5e13-bf79-44cd-9cc1-68c50d4117e6","block_type":"box","text":"borrowed bonds) notwithstanding the limitation on the issuance of senior securities in Section 18 of the","page_number":427,"box":{"x":117,"y":397,"width":767,"height":12}},{"id":"8b8ac4e7-ae95-49ec-a6d4-b5860d9e99f6","block_type":"box","text":"Investment Company Act, provided that the Fund either (i) complies with the 300% asset coverage","page_number":427,"box":{"x":117,"y":413,"width":736,"height":12}},{"id":"63e8af09-893b-4efd-8975-14ac9bfe8b91","block_type":"box","text":"ratio with respect to all such transactions and any other borrowings in the aggregate, or (ii) treats all","page_number":427,"box":{"x":117,"y":428,"width":744,"height":12}},{"id":"5663809c-525d-437e-a30e-084989968c6c","block_type":"box","text":"such transactions as Derivatives Transactions under Rule 18f-4. See “— Derivatives — Regulation of","page_number":427,"box":{"x":116,"y":444,"width":756,"height":12}},{"id":"ecb1b4b6-ee63-4646-a857-cf76b3c3852e","block_type":"box","text":"Derivatives — Rule 18f-4 under the Investment Company Act” above. The SEC has also finalized rules","page_number":427,"box":{"x":117,"y":459,"width":768,"height":12}},{"id":"c83afd07-82ae-4732-82fe-70465c53fe18","block_type":"box","text":"that will require certain transactions involving U.S. Treasuries, including reverse repurchase","page_number":427,"box":{"x":116,"y":475,"width":685,"height":12}},{"id":"3d50f375-1070-49db-ba88-2cdb170b3747","block_type":"box","text":"agreements, to be centrally cleared. Compliance with these rules is expected to be required by the","page_number":427,"box":{"x":116,"y":490,"width":736,"height":12}},{"id":"8b3ab8df-0a3a-4585-8a4d-002ef55e9f60","block_type":"box","text":"middle of 2027. Although the impact of these rules on the Funds is difficult to predict, they may reduce","page_number":427,"box":{"x":117,"y":506,"width":762,"height":12}},{"id":"80ba4a7f-a4ec-4719-824e-be3be658b196","block_type":"box","text":"the availability or increase the costs of such transactions and may adversely affect a Fund’s","page_number":427,"box":{"x":116,"y":521,"width":686,"height":12}},{"id":"e8e30a60-3452-40bf-977c-9702a73ad48b","block_type":"box","text":"performance.","page_number":427,"box":{"x":117,"y":537,"width":103,"height":12}},{"id":"c63d38cf-b297-4d35-9dc3-0c7748312f85","block_type":"box","text":"Additionally, regulations adopted by global prudential regulators require certain bank-regulated","page_number":427,"box":{"x":116,"y":568,"width":707,"height":12}},{"id":"3e42e83b-8439-46c2-8592-04fb6c243070","block_type":"box","text":"counterparties and certain of their affiliates to include in certain financial contracts, including many","page_number":427,"box":{"x":116,"y":583,"width":732,"height":12}},{"id":"0db6fa1d-6c1f-485f-9367-897093987381","block_type":"box","text":"reverse repurchase agreements, terms that delay or restrict the rights of counterparties, such as a","page_number":427,"box":{"x":117,"y":599,"width":732,"height":12}},{"id":"58fd7ad1-42fe-4d6c-bb48-a8ac82f91519","block_type":"box","text":"Fund, to terminate such agreements, take foreclosure action, exercise other default rights or restrict","page_number":427,"box":{"x":117,"y":614,"width":744,"height":12}},{"id":"c288a765-7ed2-4809-8854-3e04d2ae1003","block_type":"box","text":"transfers of credit support in the event that the counterparty and/or its affiliates are subject to certain","page_number":427,"box":{"x":116,"y":630,"width":748,"height":12}},{"id":"1c5149f2-2d92-42e7-9c2e-146f19cca2bd","block_type":"box","text":"types of resolution or insolvency proceedings. It is possible that these requirements, as well as","page_number":427,"box":{"x":116,"y":645,"width":707,"height":12}},{"id":"07d6cbd7-af79-493b-916d-2cd9c4598689","block_type":"box","text":"potential additional government regulation and other developments in the market, could adversely","page_number":427,"box":{"x":117,"y":661,"width":725,"height":12}},{"id":"dbc23fe0-c519-4bfc-92a9-8d1bef901b60","block_type":"box","text":"affect a Fund’s ability to terminate existing reverse repurchase agreements or to realize amounts to be","page_number":427,"box":{"x":116,"y":676,"width":760,"height":12}},{"id":"dd01a7a1-533f-4ed5-b942-567cb889be6c","block_type":"box","text":"received under such agreements.","page_number":427,"box":{"x":117,"y":692,"width":247,"height":12}},{"id":"664f31db-5b49-4baa-86f4-1c97557a27eb","block_type":"box","text":"Rights Offerings and Warrants to Purchase.","page_number":427,"box":{"x":116,"y":723,"width":349,"height":12}},{"id":"1267209f-b382-4241-9e1b-f8d5966ee9f3","block_type":"box","text":"Certain Funds may participate in rights offerings and","page_number":427,"box":{"x":471,"y":723,"width":388,"height":12}},{"id":"113e05af-126e-4837-930b-c203e6b058a8","block_type":"box","text":"may purchase warrants, which are privileges issued by corporations enabling the owners to subscribe","page_number":427,"box":{"x":117,"y":738,"width":754,"height":12}},{"id":"87ea545a-f47e-4afa-9230-1af856889910","block_type":"box","text":"to and purchase a specified number of shares of the corporation at a specified price during a specified","page_number":427,"box":{"x":116,"y":754,"width":758,"height":12}},{"id":"d1ad5f95-ddb2-461a-9433-8b1436da92a3","block_type":"box","text":"period of time. Subscription rights normally have a short life span to expiration. The purchase of rights","page_number":427,"box":{"x":117,"y":769,"width":754,"height":12}},{"id":"8a2f3516-5d36-413c-842b-2bf3dc7c5dd6","block_type":"box","text":"or warrants involves the risk that a Fund could lose the purchase value of a right or warrant if the right","page_number":427,"box":{"x":116,"y":785,"width":755,"height":12}},{"id":"78a479a7-ff4a-4658-a3b2-d41f668423d0","block_type":"box","text":"to subscribe to additional shares is not exercised prior to the rights’ and warrants’ expiration. Also, the","page_number":427,"box":{"x":116,"y":800,"width":755,"height":12}},{"id":"bdb5e0dd-cc82-483d-9afd-e9b4890ecebf","block_type":"box","text":"purchase of rights and/or warrants involves the risk that the effective price paid for the right and/or","page_number":427,"box":{"x":117,"y":816,"width":727,"height":12}},{"id":"9888a072-5ed1-4f9e-b3bc-bdaa3d8ef4a0","block_type":"box","text":"warrant added to the subscription price of the related security may exceed the value of the subscribed","page_number":427,"box":{"x":116,"y":831,"width":762,"height":12}},{"id":"6c8bd0af-7447-4291-9d08-176b1cf67ae6","block_type":"box","text":"security’s market price such as when there is no movement in the level of the underlying security.","page_number":427,"box":{"x":116,"y":847,"width":728,"height":12}},{"id":"c19f69b7-22b6-48e9-aed2-3a28dfb978db","block_type":"box","text":"Buying a warrant does not make the Fund a shareholder of the underlying stock. The warrant holder","page_number":427,"box":{"x":117,"y":862,"width":747,"height":12}},{"id":"9417b60d-708e-49f3-afed-6c1e6d0bd0a2","block_type":"box","text":"has no voting or dividend rights with respect to the underlying stock. A warrant does not carry any right","page_number":427,"box":{"x":117,"y":878,"width":766,"height":12}},{"id":"536ab61e-6c41-4ac9-abeb-78281db6a15e","block_type":"box","text":"II-95","page_number":427,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"b2ded9d7-600f-49ce-a7ea-ee99a1246c53","block_type":"box","text":"NM1026U-6004382-427/605","page_number":427,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3e8e249a-5ceb-4f63-99db-3df9d1d838d8","block_type":"box","text":"to assets of the issuer, and for this reason investments in warrants may be more speculative than other","page_number":428,"box":{"x":116,"y":87,"width":771,"height":12}},{"id":"3543d116-55be-4a47-a8c8-0ca35028a65c","block_type":"box","text":"equity-based investments.","page_number":428,"box":{"x":116,"y":103,"width":200,"height":12}},{"id":"27c7ed57-f306-4c7d-ab97-c5a25429bacc","block_type":"box","text":"Rule 144A Securities.","page_number":428,"box":{"x":116,"y":134,"width":170,"height":9}},{"id":"f30b559f-850f-4b3d-9138-5dd036a2eb09","block_type":"box","text":"A Fund may purchase securities that can be offered and sold only to “qualified","page_number":428,"box":{"x":287,"y":134,"width":590,"height":12}},{"id":"6884b6b4-0886-45ff-badc-08e2489c9b24","block_type":"box","text":"institutional buyers” pursuant to Rule 144A under the Securities Act. See “Restricted Securities” above.","page_number":428,"box":{"x":117,"y":149,"width":769,"height":12}},{"id":"334854e3-c667-4f6c-ac31-8fd361d7e342","block_type":"box","text":"Securities Lending.","page_number":428,"box":{"x":117,"y":180,"width":153,"height":12}},{"id":"97ca7653-6a78-48bb-8ff0-e3a1795b40fe","block_type":"box","text":"Each Fund may lend portfolio securities to certain borrowers that BlackRock","page_number":428,"box":{"x":271,"y":180,"width":575,"height":12}},{"id":"4ee128de-ba03-414f-9370-f79d536b6e6e","block_type":"box","text":"determines to be creditworthy, including borrowers affiliated with BlackRock. The borrowers provide","page_number":428,"box":{"x":116,"y":196,"width":744,"height":12}},{"id":"6d1b5719-14d4-41e9-930e-8c2ae20b1f67","block_type":"box","text":"collateral that is maintained in an amount at least","page_number":428,"box":{"x":116,"y":211,"width":369,"height":10}},{"id":"a50e45f2-d621-4b78-9591-6ddfcdfd1472","block_type":"box","text":"equal to the current market value of the securities","page_number":428,"box":{"x":486,"y":211,"width":373,"height":12}},{"id":"650b2ef5-2d32-4b2f-bf88-7dab74648080","block_type":"box","text":"loaned. No securities loan shall be made on behalf of a Fund if, as a result, the aggregate value of all","page_number":428,"box":{"x":117,"y":227,"width":755,"height":12}},{"id":"e9899ced-a1c6-409b-be45-8dddf4807449","block_type":"box","text":"securities loans of the particular Fund exceeds one-third of the value of such Fund’s total assets","page_number":428,"box":{"x":116,"y":242,"width":718,"height":12}},{"id":"5a553436-9244-42f4-9499-b5fb30a6db11","block_type":"box","text":"(including the value of the collateral received). A Fund may terminate a loan at any time and obtain the","page_number":428,"box":{"x":117,"y":258,"width":765,"height":12}},{"id":"9fb0b8aa-d6b7-4c0b-a1ef-4a514fb1737e","block_type":"box","text":"return of the securities loaned. Each Fund receives, by way of substitute payment, the value of any","page_number":428,"box":{"x":117,"y":273,"width":738,"height":12}},{"id":"8037812f-aa2f-4576-9f7e-f96b53f0c036","block_type":"box","text":"interest or cash or non-cash distributions paid on the loaned securities that it would have otherwise","page_number":428,"box":{"x":117,"y":289,"width":738,"height":12}},{"id":"ea8a307c-ce2b-4cf3-b3bf-45b7ac6a2de0","block_type":"box","text":"received if the securities were not on loan.","page_number":428,"box":{"x":117,"y":304,"width":318,"height":10}},{"id":"7c26113d-2958-4389-9d36-fe84db07a2ea","block_type":"box","text":"With respect to loans that are collateralized by cash, the borrower may be entitled to receive a fee","page_number":428,"box":{"x":116,"y":335,"width":732,"height":12}},{"id":"9cb20c2a-4603-4f97-9469-d155a02cad41","block_type":"box","text":"based on the amount of cash collateral. The Funds are compensated by any positive difference","page_number":428,"box":{"x":117,"y":351,"width":712,"height":12}},{"id":"4e852446-ae1e-47bc-877e-924945010097","block_type":"box","text":"between the amount earned on the reinvestment of cash collateral and the fee paid to the borrower. In","page_number":428,"box":{"x":117,"y":366,"width":763,"height":12}},{"id":"0cb0b7c9-94dc-4d87-a7d9-4e79394ee378","block_type":"box","text":"the case of collateral other than cash, a Fund is compensated by a fee paid by the borrower equal to a","page_number":428,"box":{"x":116,"y":382,"width":765,"height":12}},{"id":"479b5021-ee5f-41b1-88a7-a3c413921af1","block_type":"box","text":"percentage of the market value of the loaned securities. Any cash collateral received by the Fund for","page_number":428,"box":{"x":117,"y":397,"width":750,"height":12}},{"id":"a47d69f7-fae4-4e21-bd96-c6a0f15a5991","block_type":"box","text":"such loans, and uninvested cash, may be reinvested in certain short-term instruments either directly on","page_number":428,"box":{"x":116,"y":413,"width":770,"height":12}},{"id":"c351fcca-d1fa-42d2-8671-ccb3138bcb81","block_type":"box","text":"behalf of the Fund or through one or more joint accounts or money market funds, including those","page_number":428,"box":{"x":117,"y":428,"width":722,"height":12}},{"id":"e529682a-eff0-4c46-9fae-939f1690dce9","block_type":"box","text":"affiliated with BlackRock; such investments are subject to investment risk.","page_number":428,"box":{"x":116,"y":444,"width":553,"height":12}},{"id":"ae954646-fd21-436b-910d-7d9b55d9dd06","block_type":"box","text":"Securities lending involves exposure to certain risks, including operational risk (","page_number":428,"box":{"x":116,"y":475,"width":589,"height":12}},{"id":"ed7c74a6-3346-4f8d-bc43-aeae2423d1de","block_type":"box","text":"i.e.","page_number":428,"box":{"x":706,"y":475,"width":21,"height":9}},{"id":"587ead1c-2abf-4e60-9697-64a3aabc26ed","block_type":"box","text":", the risk of losses","page_number":428,"box":{"x":730,"y":475,"width":138,"height":11}},{"id":"15e8d7d5-d31f-46fb-b0dd-3890e541b388","block_type":"box","text":"resulting from problems in the settlement and accounting process), “gap” risk (","page_number":428,"box":{"x":117,"y":490,"width":580,"height":12}},{"id":"cdc0e3d8-9df9-4253-a488-c437222df9f5","block_type":"box","text":"i.e.","page_number":428,"box":{"x":698,"y":490,"width":21,"height":10}},{"id":"215eec16-75fa-4b87-ba01-8dec9bbb2ec8","block_type":"box","text":", the risk of a","page_number":428,"box":{"x":722,"y":490,"width":100,"height":11}},{"id":"19576862-8f0b-4e12-a052-a7ea64675999","block_type":"box","text":"mismatch between the return on cash collateral reinvestments and the fees each Fund has agreed to","page_number":428,"box":{"x":117,"y":506,"width":755,"height":12}},{"id":"1445a9ad-1402-4914-9100-55a59c20c83c","block_type":"box","text":"pay a borrower), foreign exchange risk (","page_number":428,"box":{"x":117,"y":521,"width":296,"height":12}},{"id":"ef7c2cfd-147e-4468-9beb-c8c57b3881e9","block_type":"box","text":"i.e.","page_number":428,"box":{"x":414,"y":521,"width":20,"height":10}},{"id":"17f0caac-ca2c-453d-aa5f-1f816450c428","block_type":"box","text":", the risk of a shortfall at default when a cash collateral","page_number":428,"box":{"x":437,"y":521,"width":409,"height":11}},{"id":"6b17c7fd-061f-45cf-9c43-71378acdd9e7","block_type":"box","text":"investment is denominated in a currency other than the currency of the assets being loaned due to","page_number":428,"box":{"x":117,"y":537,"width":735,"height":12}},{"id":"1b215eae-ff21-4284-89eb-f710a4a6f217","block_type":"box","text":"movements in foreign exchange rates), and credit, legal, counterparty and market risks (including the","page_number":428,"box":{"x":117,"y":552,"width":754,"height":12}},{"id":"3a5978c9-2968-4ac7-86a0-fe1aca2ff1cb","block_type":"box","text":"risk that market events, including but not limited to corporate actions, could lead a Fund to lend","page_number":428,"box":{"x":117,"y":568,"width":709,"height":12}},{"id":"101ead1e-66d1-408f-aee6-c5e834923379","block_type":"box","text":"securities that are trading at a premium due to increased demand, or to recall loaned securities or to","page_number":428,"box":{"x":116,"y":583,"width":748,"height":12}},{"id":"953d1b59-2feb-4782-9594-1f4a7dbc4903","block_type":"box","text":"lend less or not at all, which could lead to reduced securities lending revenue). If a Fund were to lend","page_number":428,"box":{"x":117,"y":599,"width":754,"height":12}},{"id":"557e2476-6aa0-4e7c-9c03-d30ec96d85c9","block_type":"box","text":"out securities that are subject to a corporate action and commit to the borrower a particular election as","page_number":428,"box":{"x":116,"y":614,"width":764,"height":12}},{"id":"a643a3ca-2d4e-4998-ad21-b69ea87136f6","block_type":"box","text":"determined by the Fund’s investment adviser, the benefit the Fund would receive in respect of","page_number":428,"box":{"x":116,"y":630,"width":702,"height":12}},{"id":"291efe31-e39d-44bc-b6a0-150877e33e59","block_type":"box","text":"committing to such election may or may not be less than the benefit the Fund would have received","page_number":428,"box":{"x":116,"y":645,"width":736,"height":12}},{"id":"447c1a91-f90a-47f5-b202-24c91e2bc632","block_type":"box","text":"from making a different election in such corporate action. If a securities lending counterparty were to","page_number":428,"box":{"x":116,"y":661,"width":743,"height":12}},{"id":"b422aa8c-a046-42bb-87e3-56d5ec108c94","block_type":"box","text":"default, a Fund would be subject to the risk of a possible delay in receiving collateral or in recovering","page_number":428,"box":{"x":116,"y":676,"width":745,"height":12}},{"id":"8eb84410-8751-419a-9b11-4c72556e7fe1","block_type":"box","text":"the loaned securities, or to a possible loss of rights in the collateral. In the event a borrower does not","page_number":428,"box":{"x":116,"y":692,"width":746,"height":12}},{"id":"8866a43f-c05b-45ed-83af-42b8cc1a46dd","block_type":"box","text":"return a Fund’s securities as agreed, the Fund’s ability to participate in a corporate action event may","page_number":428,"box":{"x":117,"y":707,"width":743,"height":12}},{"id":"e7176aad-619f-46d5-9546-16bf3d7c27f6","block_type":"box","text":"be impacted, or the Fund may experience losses if the proceeds received from liquidating the collateral","page_number":428,"box":{"x":117,"y":723,"width":763,"height":12}},{"id":"4352cada-c42d-455a-88de-f9b61ca13b37","block_type":"box","text":"do not at least equal the value of the loaned security at the time the collateral is liquidated, plus the","page_number":428,"box":{"x":116,"y":738,"width":734,"height":12}},{"id":"e301b126-78a9-42f0-92b1-b940a89224b6","block_type":"box","text":"transaction costs incurred in purchasing replacement securities. This latter event could trigger adverse","page_number":428,"box":{"x":116,"y":754,"width":760,"height":12}},{"id":"6aa3595f-83bd-4d08-8a2c-76507cc28188","block_type":"box","text":"tax consequences for a Fund. A Fund could lose money if its short-term investment of the collateral","page_number":428,"box":{"x":116,"y":769,"width":736,"height":12}},{"id":"40c8a49e-d3fd-43a6-850e-c14da8543367","block_type":"box","text":"declines in value over the period of the loan. Substitute payments received by a Fund representing","page_number":428,"box":{"x":116,"y":785,"width":731,"height":12}},{"id":"466cce77-b8fe-419c-98a5-197e68f21873","block_type":"box","text":"dividends paid on securities loaned out by the Fund will not be considered qualified dividend income,","page_number":428,"box":{"x":116,"y":800,"width":746,"height":12}},{"id":"eaaf426e-816e-470b-9bd7-67ce4504cc18","block_type":"box","text":"and distributions by the Fund of such substitute payments will not constitute qualified dividend income.","page_number":428,"box":{"x":116,"y":816,"width":759,"height":12}},{"id":"a2c6ff27-5ded-4b21-8871-3e8ff83b1cc1","block_type":"box","text":"Additionally, substitute payments received by a Fund representing qualified REIT dividends paid on","page_number":428,"box":{"x":116,"y":831,"width":741,"height":12}},{"id":"9753a766-a1df-4266-9b78-0e83c416cd58","block_type":"box","text":"REIT securities loaned out by the Fund will not be considered qualified REIT dividends, and","page_number":428,"box":{"x":117,"y":847,"width":684,"height":12}},{"id":"bdce7b6b-bf6c-4d60-8b8e-e7031ea92453","block_type":"box","text":"distributions by the Fund of such substitute payments will not be eligible for a 20% deduction currently","page_number":428,"box":{"x":116,"y":862,"width":761,"height":12}},{"id":"ae4f2bb0-2dbe-49e2-a077-75ab07ddcfc3","block_type":"box","text":"available for ordinary REIT dividends paid to non-corporate shareholders provided certain other","page_number":428,"box":{"x":116,"y":878,"width":713,"height":12}},{"id":"ab52444e-a2b1-4875-81cf-88f25b959ea5","block_type":"box","text":"II-96","page_number":428,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"1fd5f9f9-b8e5-4c42-8b16-42f9bf73a7cc","block_type":"box","text":"NM1026U-6004382-428/605","page_number":428,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"087a1afa-353b-47a5-ac57-5a94610d3c1a","block_type":"box","text":"requirements are satisfied. The securities lending agent will take into account the tax effects on","page_number":429,"box":{"x":117,"y":87,"width":710,"height":12}},{"id":"7e3d6018-c521-4d7f-9f5f-75a385041eab","block_type":"box","text":"shareholders caused by these differences in connection with a Fund’s securities lending program.","page_number":429,"box":{"x":116,"y":102,"width":730,"height":13}},{"id":"79909b51-9ec1-43b4-8f99-e320b9d13d6d","block_type":"box","text":"Substitute payments received on tax-exempt securities loaned out will not be tax-exempt income.","page_number":429,"box":{"x":116,"y":118,"width":727,"height":12}},{"id":"003655aa-b1e8-443e-ab7f-257f128f5073","block_type":"box","text":"There could also be changes in the status of issuers under applicable laws and regulations, including","page_number":429,"box":{"x":116,"y":134,"width":755,"height":12}},{"id":"a2a98c9c-0047-4c2f-9d85-ef2cae743acc","block_type":"box","text":"tax regulations, that may impact the regulatory or tax treatment of loaned securities and could, for","page_number":429,"box":{"x":116,"y":149,"width":729,"height":12}},{"id":"5d801138-c856-412b-a3a5-bd49f37ba9f5","block_type":"box","text":"example, result in a delay in the payment of dividend equivalent payments owed to a Fund (as","page_number":429,"box":{"x":116,"y":165,"width":704,"height":12}},{"id":"f94a7ef9-863b-4c4b-9578-2cce39715295","block_type":"box","text":"permitted by applicable law).","page_number":429,"box":{"x":117,"y":180,"width":217,"height":12}},{"id":"e6f9d4d8-8371-4a3d-a566-cef8389f65b4","block_type":"box","text":"Regulations adopted by global prudential regulators require certain bank-regulated counterparties and","page_number":429,"box":{"x":117,"y":211,"width":761,"height":12}},{"id":"69cba489-f020-4be0-8b82-d66bdf56524d","block_type":"box","text":"certain of their affiliates to include in certain financial contracts, including many securities lending","page_number":429,"box":{"x":116,"y":227,"width":723,"height":12}},{"id":"cb7534b1-15ef-4cba-944f-74c7f50ce09d","block_type":"box","text":"agreements, terms that delay or restrict the rights of counterparties, such as the Fund, to terminate","page_number":429,"box":{"x":116,"y":242,"width":739,"height":12}},{"id":"ccb49f20-047d-4ffa-b188-e4d682021299","block_type":"box","text":"such agreements, foreclose upon collateral, exercise other default rights or restrict transfers of credit","page_number":429,"box":{"x":116,"y":258,"width":751,"height":12}},{"id":"9cdc4a89-f4b8-480c-9911-552e8d501708","block_type":"box","text":"support in the event that the counterparty and/or its affiliates are subject to certain types of resolution","page_number":429,"box":{"x":116,"y":273,"width":754,"height":12}},{"id":"ab7af122-7d68-4083-9650-721ea0f071ca","block_type":"box","text":"or insolvency proceedings. It is possible that these requirements, as well as potential additional","page_number":429,"box":{"x":116,"y":289,"width":711,"height":12}},{"id":"b36328e8-0fb9-45a1-97b4-59038f9626ef","block_type":"box","text":"government regulation and other developments in the market, could adversely affect the Fund’s ability","page_number":429,"box":{"x":116,"y":304,"width":762,"height":12}},{"id":"7363a4bf-8ea5-4a70-94d3-966b8b3864d8","block_type":"box","text":"to terminate existing securities lending agreements or to realize amounts to be received under such","page_number":429,"box":{"x":116,"y":320,"width":744,"height":12}},{"id":"a6a76295-45f7-415c-9636-644e15404d77","block_type":"box","text":"agreements. Prudential regulation may also favor lenders that can provide additional protections, such","page_number":429,"box":{"x":116,"y":335,"width":764,"height":12}},{"id":"29504b2b-dcb8-4261-9256-becda6bed28f","block_type":"box","text":"as liens that are exercisable upon lender default, to bank borrowers. Certain Funds expect to provide","page_number":429,"box":{"x":116,"y":351,"width":754,"height":12}},{"id":"c4c7c496-b5ce-4443-9acf-e8cfdd1dc7d9","block_type":"box","text":"additional protections to bank borrowers, where permitted pursuant to a Fund’s investment policies and","page_number":429,"box":{"x":116,"y":366,"width":771,"height":12}},{"id":"c09fc531-48a4-4107-a5f8-8edf99624f50","block_type":"box","text":"if BlackRock believes doing so is in the best interest of the Fund.","page_number":429,"box":{"x":117,"y":382,"width":484,"height":12}},{"id":"c62a4d3d-6d37-4bb6-a303-0fb7fc815350","block_type":"box","text":"The SEC has adopted a rule that will require reporting and public disclosure of securities loan","page_number":429,"box":{"x":116,"y":413,"width":698,"height":12}},{"id":"e79edb87-3833-4d4f-b911-405e1ac97fbf","block_type":"box","text":"transaction","page_number":429,"box":{"x":116,"y":428,"width":81,"height":10}},{"id":"868b43df-5b14-4664-bf0e-2271486cb3af","block_type":"box","text":"information (not including party names); this may include, but is not limited to, information","page_number":429,"box":{"x":204,"y":428,"width":667,"height":12}},{"id":"d71bae67-7e7e-4b9f-8083-a459ed7bb1aa","block_type":"box","text":"about securities","page_number":429,"box":{"x":116,"y":444,"width":117,"height":9}},{"id":"2c3db7aa-9afe-4a8e-a67f-a8407ae52d27","block_type":"box","text":"loans entered into in connection with short sales. Compliance with this rule is expected","page_number":429,"box":{"x":239,"y":444,"width":648,"height":12}},{"id":"5c85d441-f0a8-47e5-b7d4-9e45c599d008","block_type":"box","text":"to be required late 2028, although in response to the outcome of a legal challenge against the rule, the","page_number":429,"box":{"x":116,"y":459,"width":766,"height":12}},{"id":"12c2feca-9acb-4056-818e-8d6be6be1bd9","block_type":"box","text":"SEC may amend the rule and/or delay the current expected compliance date.","page_number":429,"box":{"x":116,"y":475,"width":580,"height":12}},{"id":"46935276-23e7-4fce-9907-8706a4137673","block_type":"box","text":"Short Sales.","page_number":429,"box":{"x":117,"y":506,"width":95,"height":9}},{"id":"23110d1c-e1a7-4e3c-b1a3-a9c851254423","block_type":"box","text":"Certain Funds may make short sales of securities, either as a hedge against potential","page_number":429,"box":{"x":213,"y":506,"width":645,"height":12}},{"id":"bb3069f0-24bf-428f-a847-3b4a9e63e529","block_type":"box","text":"declines in value of a portfolio security or to realize appreciation when a security that the Fund does","page_number":429,"box":{"x":116,"y":521,"width":744,"height":12}},{"id":"728df2f2-b0cc-4f59-9881-744aebf221f2","block_type":"box","text":"not own declines in value. Certain Funds have a fundamental investment restriction prohibiting short","page_number":429,"box":{"x":117,"y":537,"width":747,"height":12}},{"id":"37a684d7-496e-47e0-ba3c-c1e0d3e6b989","block_type":"box","text":"sales of securities unless they are “against-the-box.” In a short sale “against-the-box,” at the time of the","page_number":429,"box":{"x":116,"y":552,"width":771,"height":12}},{"id":"0e08532e-437d-467f-83f9-37791913a7da","block_type":"box","text":"sale, the Fund owns or has the immediate and unconditional right to acquire the identical security at no","page_number":429,"box":{"x":116,"y":568,"width":769,"height":12}},{"id":"2a9b0b6c-16fc-4801-a4bc-7461598fa3c4","block_type":"box","text":"additional cost. When a Fund makes a short sale, it borrows the security sold short and delivers it to","page_number":429,"box":{"x":116,"y":583,"width":746,"height":12}},{"id":"64259940-8954-43ab-8339-60164e5ebf6b","block_type":"box","text":"the broker-dealer through which it made the short sale. A Fund may have to pay a fee to borrow","page_number":429,"box":{"x":116,"y":599,"width":717,"height":12}},{"id":"b7f192c1-ee1b-45df-9288-de9d708e0de0","block_type":"box","text":"particular securities and is often obligated to turn over any payments received on such borrowed","page_number":429,"box":{"x":117,"y":614,"width":719,"height":12}},{"id":"ee7bf2f1-bebc-4de7-92d1-1c9eb23ac25a","block_type":"box","text":"securities to the lender of the securities.","page_number":429,"box":{"x":116,"y":630,"width":301,"height":9}},{"id":"2752629e-461e-4b35-9838-c6a7cd9a9a4c","block_type":"box","text":"A Fund secures its obligation to replace the borrowed security by depositing collateral with the broker","page_number":429,"box":{"x":116,"y":661,"width":756,"height":12}},{"id":"daaca641-01b6-407d-bae7-aaa17d57eb1a","block_type":"box","text":"dealer, usually in cash, U.S. Government Securities or other liquid securities similar to those borrowed.","page_number":429,"box":{"x":116,"y":676,"width":763,"height":12}},{"id":"7cccb1f4-9d80-4fb2-9d53-a1b5a92de1e6","block_type":"box","text":"With respect to uncovered short positions, a Fund is required to deposit similar collateral with its","page_number":429,"box":{"x":116,"y":692,"width":712,"height":12}},{"id":"9ac78836-a238-44ba-b44e-9a8650a174fb","block_type":"box","text":"custodian, if necessary, to the extent that the value of both collateral deposits in the aggregate is at all","page_number":429,"box":{"x":116,"y":707,"width":757,"height":12}},{"id":"4a591ebf-a30e-46d9-a416-0755914c6337","block_type":"box","text":"times equal to at least 100% of the current market value of the security sold short. Depending on","page_number":429,"box":{"x":116,"y":723,"width":717,"height":12}},{"id":"2c77e61e-0d76-44b7-9288-def416269fe0","block_type":"box","text":"arrangements made with the broker-dealer from which the Fund borrowed the security, regarding","page_number":429,"box":{"x":116,"y":738,"width":720,"height":12}},{"id":"87fd433b-1c1d-4e18-a74c-4831a17b4b83","block_type":"box","text":"payment received by the Fund on such security, a Fund may not receive any payments (including","page_number":429,"box":{"x":117,"y":754,"width":722,"height":12}},{"id":"59f5e9a2-bedf-4eab-b3c5-2888d074bb93","block_type":"box","text":"interest) on its collateral deposited with such broker-dealer.","page_number":429,"box":{"x":117,"y":769,"width":437,"height":12}},{"id":"9fd22648-e790-4bc1-85e9-76060189467f","block_type":"box","text":"Because making short sales in securities that it does not own exposes a Fund to the risks associated","page_number":429,"box":{"x":117,"y":800,"width":748,"height":12}},{"id":"a61af8e0-9284-4ebc-83d2-69ca2e503cc5","block_type":"box","text":"with those securities, such short sales involve speculative exposure risk. A Fund will incur a loss as a","page_number":429,"box":{"x":116,"y":816,"width":750,"height":12}},{"id":"65a84b98-fd8a-4b1a-9b63-463cc9986a12","block_type":"box","text":"result of a short sale if the price of the security increases between the date of the short sale and the","page_number":429,"box":{"x":117,"y":831,"width":743,"height":12}},{"id":"ee782e89-d60c-4e03-b56e-aff99aaa7f6d","block_type":"box","text":"date on which the Fund replaces the borrowed security. As a result, if a Fund makes short sales in","page_number":429,"box":{"x":116,"y":847,"width":735,"height":12}},{"id":"42cc6353-6ee4-40fb-9f37-3f4294523305","block_type":"box","text":"securities that increase in value, it will likely underperform similar mutual funds that do not make short","page_number":429,"box":{"x":116,"y":862,"width":759,"height":12}},{"id":"cee779bb-2f6a-46b5-b0de-41f17ca11d20","block_type":"box","text":"sales in securities. A Fund will realize a gain on a short sale if the security declines in price between","page_number":429,"box":{"x":116,"y":878,"width":746,"height":12}},{"id":"4ca789dd-1a11-4fe9-aee4-469d3f77a1cd","block_type":"box","text":"II-97","page_number":429,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"b1945fe6-d5b5-4d77-aa14-1e1e87d95673","block_type":"box","text":"NM1026U-6004382-429/605","page_number":429,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"84a1da01-d345-4ea0-a220-d46e03f43501","block_type":"box","text":"those dates. There can be no assurance that a Fund will be able to close out a short sale position at","page_number":430,"box":{"x":116,"y":87,"width":747,"height":12}},{"id":"bf63d627-5ade-4052-a536-c72b803f2f62","block_type":"box","text":"any particular time or at an acceptable price. Although a Fund’s gain is limited to the price at which it","page_number":430,"box":{"x":116,"y":103,"width":750,"height":12}},{"id":"baae2e23-0346-46d7-9b67-1191efed3a5f","block_type":"box","text":"sold the security short, its potential loss is limited only by the maximum attainable price of the security,","page_number":430,"box":{"x":116,"y":118,"width":764,"height":12}},{"id":"9f306838-3805-42cf-bd2b-e31df46b5f7a","block_type":"box","text":"less the price at which the security was sold and may, theoretically, be unlimited.","page_number":430,"box":{"x":117,"y":134,"width":603,"height":12}},{"id":"3e2ad00c-7efe-43e0-81ab-89584f5638c8","block_type":"box","text":"A Fund may also make short sales “against the box” without being subject to such limitations.","page_number":430,"box":{"x":116,"y":168,"width":698,"height":12}},{"id":"3410dab8-a5a3-4b7b-b374-41a95a183e52","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":430,"box":{"x":116,"y":202,"width":756,"height":12}},{"id":"9e8503f6-1ccf-462e-8cdf-312f42c10417","block_type":"box","text":"borrowings, which are considered Derivatives Transactions under the Rule. See “— Derivatives —","page_number":430,"box":{"x":117,"y":217,"width":734,"height":12}},{"id":"d6ce6950-72bf-4afb-b463-892453978e66","block_type":"box","text":"Regulation of Derivatives — Rule 18f-4 under the Investment Company Act” above.","page_number":430,"box":{"x":117,"y":233,"width":624,"height":12}},{"id":"49c9b472-dc19-4598-a37e-f09d71599b8a","block_type":"box","text":"Short sales are also subject to certain SEC regulations and certain European Union and United","page_number":430,"box":{"x":116,"y":267,"width":712,"height":12}},{"id":"a01fc3ad-59f2-4735-881c-7395c547ceaa","block_type":"box","text":"Kingdom regulations (under which there are restrictions on net short sales in certain securities). If the","page_number":430,"box":{"x":117,"y":282,"width":755,"height":12}},{"id":"0e3f8ca8-3cef-41dd-9a2e-a5c06791e15c","block_type":"box","text":"SEC or regulatory authorities in other jurisdictions were to adopt additional restrictions regarding short","page_number":430,"box":{"x":116,"y":298,"width":761,"height":12}},{"id":"e9342cde-6730-4eb1-b5f4-74fc6bbebc2c","block_type":"box","text":"sales, they could restrict a Fund’s ability to engage in short sales in certain circumstances, and the","page_number":430,"box":{"x":116,"y":314,"width":736,"height":11}},{"id":"91c148d2-f564-4c96-ba28-80f38ccb264d","block_type":"box","text":"Fund may be unable to execute its investment strategy as a result. In response to market events, the","page_number":430,"box":{"x":117,"y":329,"width":753,"height":12}},{"id":"8994e9eb-9bda-4b1b-9786-ed05d1e994dd","block_type":"box","text":"SEC and regulatory authorities in other jurisdictions may adopt (and in certain cases, have adopted)","page_number":430,"box":{"x":116,"y":344,"width":747,"height":12}},{"id":"6c0dbfab-17d7-468c-a6b1-18bdbc73dcee","block_type":"box","text":"bans or other restrictions on short sales of certain securities or on derivatives and other hedging","page_number":430,"box":{"x":117,"y":360,"width":717,"height":12}},{"id":"f1bb0ac6-8138-4234-9569-ae6dc9d53146","block_type":"box","text":"instruments used to achieve a similar economic effect. Such bans or other restrictions may make it","page_number":430,"box":{"x":117,"y":375,"width":736,"height":12}},{"id":"0b91e85e-d552-47b2-9e8c-59afab97981d","block_type":"box","text":"impossible for a Fund to execute certain investment strategies and may have a material adverse effect","page_number":430,"box":{"x":117,"y":391,"width":765,"height":12}},{"id":"21d1f05d-249c-418d-b39a-9ee21507ed99","block_type":"box","text":"on the Fund’s ability to generate returns.","page_number":430,"box":{"x":116,"y":407,"width":306,"height":11}},{"id":"739fa148-ab9f-46c5-b6d7-3f73f0243bec","block_type":"box","text":"Special Purpose Acquisition Companies.","page_number":430,"box":{"x":117,"y":440,"width":325,"height":12}},{"id":"7e1cfc2f-be42-4f7e-bb39-77f308ea9bed","block_type":"box","text":"A Fund may invest in stock, warrants, rights and other","page_number":430,"box":{"x":443,"y":441,"width":411,"height":12}},{"id":"2920ffbd-fb92-4f9a-ad64-9f043f053831","block_type":"box","text":"interests issued by special purpose acquisition companies (“SPACs”) or similar special purpose entities","page_number":430,"box":{"x":117,"y":456,"width":770,"height":12}},{"id":"ed353e72-1fa8-42b4-922f-2c41c443dbe3","block_type":"box","text":"that pool funds to seek potential acquisition opportunities, including the “founder’s” shares and","page_number":430,"box":{"x":116,"y":471,"width":704,"height":13}},{"id":"df1abb33-2bf0-42e8-8b3c-8cb19549189e","block_type":"box","text":"warrants described below. A SPAC is a publicly traded company that raises investment capital via an","page_number":430,"box":{"x":116,"y":487,"width":755,"height":12}},{"id":"351bd1dd-01d9-413e-9640-0a9cded0b9f3","block_type":"box","text":"IPO for the purpose of identifying and acquiring one or more operating businesses or assets. In","page_number":430,"box":{"x":117,"y":502,"width":711,"height":13}},{"id":"e570eaf6-7f74-41ab-83af-644e689e0059","block_type":"box","text":"connection with forming a SPAC, the SPAC’s sponsors acquire “founder’s” shares, generally for","page_number":430,"box":{"x":116,"y":518,"width":716,"height":12}},{"id":"333e3e40-a11a-4af2-bfff-c848e045a6eb","block_type":"box","text":"nominal consideration, and warrants that will result in the sponsors owning a specified percentage","page_number":430,"box":{"x":117,"y":534,"width":731,"height":12}},{"id":"7f5ea023-7896-46f2-acd8-175289246f22","block_type":"box","text":"(typically 20%) of the SPAC’s outstanding common stock upon completion of the IPO. At the time a","page_number":430,"box":{"x":117,"y":549,"width":740,"height":12}},{"id":"ab958dd9-88b1-4cd2-aeb4-f977548dace8","block_type":"box","text":"SPAC conducts an IPO, it has selected a management team but has not yet identified a specific","page_number":430,"box":{"x":116,"y":565,"width":718,"height":12}},{"id":"6790e4e8-4c5b-4a1a-817d-3398aaad5371","block_type":"box","text":"acquisition opportunity. Unless and until an acquisition is completed, a SPAC generally invests its","page_number":430,"box":{"x":116,"y":580,"width":728,"height":12}},{"id":"4caa0874-1750-4c28-a2ab-27d81af666c3","block_type":"box","text":"assets in U.S. Government securities, money market securities and cash. If an acquisition that meets","page_number":430,"box":{"x":116,"y":596,"width":756,"height":12}},{"id":"396e637f-ee9d-43a6-9f41-7575f5d2d232","block_type":"box","text":"the requirements for the SPAC is not completed within a pre-established period of time, the invested","page_number":430,"box":{"x":116,"y":611,"width":749,"height":12}},{"id":"2d36713a-8bbe-48bd-bba6-a54aa8cd517e","block_type":"box","text":"funds are returned to the SPAC’s public shareholders, the warrants expire, and the “founder’s” shares","page_number":430,"box":{"x":116,"y":627,"width":761,"height":11}},{"id":"6b707970-cf89-4b5a-a10a-618c5cf6e843","block_type":"box","text":"and such warrants become worthless. Because SPACs and similar entities are in essence “blank","page_number":430,"box":{"x":116,"y":642,"width":725,"height":10}},{"id":"5e4ed871-c646-4057-894d-15d923390756","block_type":"box","text":"check” companies without operating histories or ongoing business operations (other than identifying","page_number":430,"box":{"x":116,"y":658,"width":745,"height":12}},{"id":"fc4579ef-d613-4108-bf1a-c4fcffcda8a9","block_type":"box","text":"and pursuing acquisitions), the potential for the long-term capital appreciation of their securities is","page_number":430,"box":{"x":116,"y":673,"width":722,"height":12}},{"id":"20588a11-6fec-49a6-8f1c-d6fb50049294","block_type":"box","text":"particularly dependent on the ability of the SPAC’s management to identify and complete a profitable","page_number":430,"box":{"x":117,"y":689,"width":746,"height":12}},{"id":"eaafe19d-0e3d-4c80-bd07-3a4dad947e78","block_type":"box","text":"acquisition. There is no guarantee that the SPACs in which a Fund invests will complete an acquisition","page_number":430,"box":{"x":116,"y":704,"width":760,"height":12}},{"id":"1b1e8bca-bfc7-4cdc-b631-16f15390696e","block_type":"box","text":"or that any acquisitions completed by the SPACs in which a Fund invests will be profitable. Some","page_number":430,"box":{"x":116,"y":720,"width":721,"height":12}},{"id":"cccf8a53-11fe-436a-acf4-4960af8c32b4","block_type":"box","text":"SPACs may pursue acquisitions only within certain industries or regions, which may ultimately lead to","page_number":430,"box":{"x":116,"y":735,"width":753,"height":12}},{"id":"131a435f-8677-40b1-b875-4d21d49ac89e","block_type":"box","text":"an increase in the volatility of their prices following the acquisition. In addition, some of these securities","page_number":430,"box":{"x":116,"y":751,"width":762,"height":12}},{"id":"6a90e4ab-0e4f-4c71-a0f9-8e47880fc9c4","block_type":"box","text":"may be considered illiquid and/or subject to restrictions on resale.","page_number":430,"box":{"x":117,"y":766,"width":485,"height":12}},{"id":"4f434826-bde3-42c8-be59-cea0f55df2c6","block_type":"box","text":"Standby Commitment Agreements.","page_number":430,"box":{"x":117,"y":800,"width":278,"height":12}},{"id":"f3bda1b1-4800-46c8-8b7c-ce7ac44955b3","block_type":"box","text":"Standby commitment agreements commit a Fund, for a stated","page_number":430,"box":{"x":402,"y":800,"width":459,"height":12}},{"id":"5af68c95-e27c-4c36-98d9-d7409a5ca35a","block_type":"box","text":"period of time, to purchase a stated amount of securities that may be issued and sold to that Fund at","page_number":430,"box":{"x":117,"y":816,"width":746,"height":12}},{"id":"5b21b175-c4a0-4cba-8924-7a3abbec8e47","block_type":"box","text":"the option of the issuer. The price of the security is fixed at the time of the commitment. At the time of","page_number":430,"box":{"x":116,"y":831,"width":756,"height":12}},{"id":"6294fbe8-1b04-4e71-8d0b-f284bbe28796","block_type":"box","text":"entering into the agreement, the Fund is paid a commitment fee, regardless of whether or not the","page_number":430,"box":{"x":116,"y":847,"width":725,"height":12}},{"id":"df63996d-eab4-488e-ac66-0dc45dee8d13","block_type":"box","text":"security is ultimately issued. A Fund will enter into such agreements for the purpose of investing in the","page_number":430,"box":{"x":116,"y":862,"width":762,"height":12}},{"id":"b2125921-ceab-4f65-80cf-87fe9397f1dd","block_type":"box","text":"security underlying the commitment at a price that is considered advantageous to the Fund.","page_number":430,"box":{"x":116,"y":878,"width":685,"height":12}},{"id":"c95d22c1-4959-4830-b6bd-92cb279ac7a1","block_type":"box","text":"II-98","page_number":430,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"cfe6b965-3415-43e9-abf7-430009e2eae7","block_type":"box","text":"NM1026U-6004382-430/605","page_number":430,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"53142910-bdda-4ae8-9dc4-38bc29ea16b5","block_type":"box","text":"There can be no assurance that the securities subject to a standby commitment will be issued, and the","page_number":431,"box":{"x":116,"y":87,"width":767,"height":12}},{"id":"7aea16b7-a6a2-46ff-b91a-31077b762321","block_type":"box","text":"value of the security, if issued, on the delivery date may be more or less than its purchase price. Since","page_number":431,"box":{"x":116,"y":102,"width":764,"height":13}},{"id":"5858d472-914f-4c7c-8cfc-cca37000476f","block_type":"box","text":"the issuance of the security underlying the commitment is at the option of the issuer, the Fund may","page_number":431,"box":{"x":116,"y":118,"width":738,"height":12}},{"id":"bf9ee02a-c436-4dea-afe7-10bdf8d9af05","block_type":"box","text":"bear the risk of a decline in the value of such security and may not benefit from an appreciation in the","page_number":431,"box":{"x":117,"y":134,"width":756,"height":12}},{"id":"1c1fe346-133b-4292-98ba-ab2a68cb2a00","block_type":"box","text":"value of the security during the commitment period.","page_number":431,"box":{"x":116,"y":149,"width":386,"height":12}},{"id":"d37ae538-8b6e-4766-a9c3-60b278f3083c","block_type":"box","text":"The purchase of a security pursuant to a standby commitment agreement and the related commitment","page_number":431,"box":{"x":116,"y":180,"width":756,"height":12}},{"id":"5937d55d-8603-446a-a300-cccf32a883bf","block_type":"box","text":"fee will be recorded on the date on which the security can reasonably be expected to be issued, and the","page_number":431,"box":{"x":116,"y":196,"width":769,"height":12}},{"id":"5d566779-c951-49cc-9681-a9470ff776c5","block_type":"box","text":"value of the security thereafter will be reflected in the calculation of a Fund’s NAV. The cost basis of the","page_number":431,"box":{"x":116,"y":211,"width":765,"height":12}},{"id":"7bf227e6-e2be-40e9-9ff0-51ffb9a88734","block_type":"box","text":"security will be adjusted by the amount of the commitment fee. In the event the security is not issued,","page_number":431,"box":{"x":116,"y":227,"width":748,"height":12}},{"id":"c6674fed-90b0-42d1-b785-bac4c283a3f7","block_type":"box","text":"the commitment fee will be recorded as income on the expiration date of the standby commitment.","page_number":431,"box":{"x":116,"y":242,"width":727,"height":12}},{"id":"b542df8c-8923-46f1-b1c8-b387837ca421","block_type":"box","text":"Standby commitments will only be entered into with dealers, banks and broker-dealers which, in the","page_number":431,"box":{"x":116,"y":273,"width":744,"height":12}},{"id":"69659b6b-0de3-4104-9cbd-a9d96ca59e67","block_type":"box","text":"Manager’s or sub-adviser’s opinion, present minimal credit risks. A Fund will acquire standby","page_number":431,"box":{"x":117,"y":289,"width":693,"height":12}},{"id":"1535ec71-8fcd-4970-ae58-9acbadb965fe","block_type":"box","text":"commitments solely to facilitate portfolio liquidity and not to exercise its rights thereunder for trading","page_number":431,"box":{"x":116,"y":304,"width":744,"height":12}},{"id":"ed2c571c-f68e-4e10-a947-86d6d4e51668","block_type":"box","text":"purposes. Standby commitments will be valued at zero in determining NAV. Accordingly, where a Fund","page_number":431,"box":{"x":117,"y":320,"width":769,"height":12}},{"id":"1c9a287d-33cb-4eec-9c3a-ed2802749207","block_type":"box","text":"pays directly or indirectly for a standby commitment, its cost will be reflected as an unrealized loss for","page_number":431,"box":{"x":117,"y":335,"width":756,"height":12}},{"id":"7745791e-5286-44d0-8443-ff3a454e1cdc","block_type":"box","text":"the period during which the commitment is held by such Fund and will be reflected as a realized gain or","page_number":431,"box":{"x":116,"y":351,"width":771,"height":12}},{"id":"e1fd28c3-bdd7-4915-abee-ddd78fbc3a3e","block_type":"box","text":"loss when the commitment is exercised or expires.","page_number":431,"box":{"x":117,"y":366,"width":380,"height":12}},{"id":"03780107-664a-4fb3-aef3-f3f777837058","block_type":"box","text":"Stripped Securities.","page_number":431,"box":{"x":117,"y":397,"width":152,"height":12}},{"id":"454d8430-8459-4642-9b29-617c74f54fda","block_type":"box","text":"Stripped securities are created when the iss","page_number":431,"box":{"x":270,"y":397,"width":324,"height":12}},{"id":"f8c08cae-f66b-4d0c-89cf-7168ba4e0e1a","block_type":"box","text":"uer separates the interest and principal","page_number":431,"box":{"x":595,"y":397,"width":288,"height":12}},{"id":"814d3f55-4a84-4b1b-ab66-70f6db5faa4f","block_type":"box","text":"components of an instrument and sells them as separate","page_number":431,"box":{"x":116,"y":413,"width":418,"height":12}},{"id":"5f7efe9d-61a6-432f-b30d-2d505c19eb9b","block_type":"box","text":"securities. In general, one security is entitled to","page_number":431,"box":{"x":535,"y":413,"width":345,"height":12}},{"id":"0e6d53d5-08ac-424b-8ca0-40b4a06ce2ac","block_type":"box","text":"receive the interest payments on the underlying assets","page_number":431,"box":{"x":117,"y":428,"width":401,"height":12}},{"id":"27674cc2-e061-419e-b003-a7e4afca8927","block_type":"box","text":"(the interest only or “IO” security) and the other to","page_number":431,"box":{"x":519,"y":428,"width":364,"height":12}},{"id":"34ebad48-0b65-40a6-a8ef-7935f194fc0e","block_type":"box","text":"receive the principal payments (the principal only or","page_number":431,"box":{"x":117,"y":444,"width":378,"height":12}},{"id":"e3ecab0f-d6d9-411f-b9fb-f43a451b04fd","block_type":"box","text":"“PO” security). Some stripped","page_number":431,"box":{"x":496,"y":444,"width":221,"height":12}},{"id":"121897c6-01c0-4e58-b9d6-b913c6feaf14","block_type":"box","text":"securities may receive","page_number":431,"box":{"x":717,"y":444,"width":167,"height":12}},{"id":"decf9ddb-f9be-4ff6-bd6c-d1f74d724768","block_type":"box","text":"a combination of interest and principal payments. The","page_number":431,"box":{"x":116,"y":459,"width":395,"height":12}},{"id":"63d8b1bb-28b7-4441-8b8c-88b42244b90e","block_type":"box","text":"yields to maturity on IOs and POs are sensitive to","page_number":431,"box":{"x":511,"y":459,"width":365,"height":12}},{"id":"ceafbbc5-2992-4d4e-92f9-28c9c6d64409","block_type":"box","text":"the expected or anticipated rate of principal paym","page_number":431,"box":{"x":116,"y":475,"width":358,"height":12}},{"id":"4d6beb8c-bb5f-459d-8aba-6828e117cedd","block_type":"box","text":"ents (including prepayments)","page_number":431,"box":{"x":476,"y":475,"width":209,"height":12}},{"id":"580f0ac2-2ce5-4b91-838a-b6dd9148903b","block_type":"box","text":"on the related underlying","page_number":431,"box":{"x":686,"y":475,"width":191,"height":12}},{"id":"d4b9affd-43f0-494e-8d3c-977433687db6","block_type":"box","text":"assets, and principal payments may have a material e","page_number":431,"box":{"x":116,"y":490,"width":392,"height":12}},{"id":"78154089-cccb-4d07-9bf7-1009b5c09a23","block_type":"box","text":"ffect on yield to maturity. If the underlying assets","page_number":431,"box":{"x":508,"y":490,"width":357,"height":12}},{"id":"e4ad08d3-bd0e-4121-afa6-ae239892ea04","block_type":"box","text":"experience greater than anticipated","page_number":431,"box":{"x":116,"y":506,"width":262,"height":12}},{"id":"5a43010e-6d63-4ebb-ba44-ecd2e429ef88","block_type":"box","text":"prepayments of principal, a Fund may not fully recoup its initial","page_number":431,"box":{"x":379,"y":506,"width":458,"height":12}},{"id":"9b01fd40-adc4-4f00-816e-abd676ef468c","block_type":"box","text":"investment in IOs. Conversely, if the underlying a","page_number":431,"box":{"x":117,"y":521,"width":356,"height":12}},{"id":"7e708287-97a0-4827-b0ba-3a73f9b12325","block_type":"box","text":"ssets experience less than anticipated prepayments of","page_number":431,"box":{"x":474,"y":521,"width":400,"height":12}},{"id":"ff23b10b-a3ce-4202-adea-c5b5fd538bff","block_type":"box","text":"principal, the yield on POs could be adversely affect","page_number":431,"box":{"x":117,"y":537,"width":376,"height":12}},{"id":"ce80a580-d24d-4451-9f97-b1b80798dac2","block_type":"box","text":"ed. Stripped securities may be highly sensitive to","page_number":431,"box":{"x":494,"y":537,"width":359,"height":12}},{"id":"c00cb017-d048-444a-9d82-012cbdab68cc","block_type":"box","text":"changes in interest rates and rates of prepayment.","page_number":431,"box":{"x":116,"y":552,"width":371,"height":12}},{"id":"3a070981-bf64-48ce-b93f-34674074607d","block_type":"box","text":"Structured Notes.","page_number":431,"box":{"x":117,"y":583,"width":139,"height":10}},{"id":"87fcd966-98ed-4abf-8f6b-7dcb128a8316","block_type":"box","text":"Structured notes and other related instruments purchased by a Fund are generally","page_number":431,"box":{"x":257,"y":583,"width":621,"height":12}},{"id":"eea09748-c3f8-4bea-b42a-182bf61e4174","block_type":"box","text":"privately negotiated debt obligations where the principal and/or interest is determined by reference to","page_number":431,"box":{"x":117,"y":599,"width":753,"height":12}},{"id":"5fea307a-4f84-4c6a-bf45-8c8a2421ea98","block_type":"box","text":"the performance of a specific asset, benchmark asset, market or interest rate (“reference measure”).","page_number":431,"box":{"x":116,"y":614,"width":751,"height":12}},{"id":"9679b2c9-b13f-4f2c-b0ee-fe20a8826743","block_type":"box","text":"Issuers of structured notes generally include corporations and banks. The interest rate or the principal","page_number":431,"box":{"x":117,"y":630,"width":760,"height":12}},{"id":"601157c8-ffb6-4688-876c-35486a3f06d0","block_type":"box","text":"amount payable upon maturity or redemption may increase or decrease, depending upon changes in","page_number":431,"box":{"x":116,"y":645,"width":754,"height":12}},{"id":"e9bde123-796b-4ba2-8414-795578729613","block_type":"box","text":"the value of the reference measure. The terms of a structured note may provide that, in certain","page_number":431,"box":{"x":116,"y":661,"width":702,"height":12}},{"id":"1b5fcd6a-4337-4a48-9538-16f3ab1dd971","block_type":"box","text":"circumstances, no principal is due at maturity and, therefore, may result in a loss of invested capital by","page_number":431,"box":{"x":116,"y":676,"width":761,"height":12}},{"id":"adcc9db3-c366-4139-81e3-215f6a5a59fa","block_type":"box","text":"a Fund. The interest and/or principal payments that may be made on a structured product may vary","page_number":431,"box":{"x":116,"y":692,"width":738,"height":12}},{"id":"d774fe26-7264-4a9e-8d8e-47e0496df64d","block_type":"box","text":"widely, depending on a variety of factors, including the volatility of the reference measure.","page_number":431,"box":{"x":116,"y":707,"width":664,"height":12}},{"id":"8e244778-f576-4a22-86b5-0f61c9047cb0","block_type":"box","text":"Structured notes may be positively or negatively indexed, so the appreciation of the reference measure","page_number":431,"box":{"x":116,"y":738,"width":765,"height":12}},{"id":"31d26a82-b2c1-40f4-9b64-abe76688ae4b","block_type":"box","text":"may produce an increase or a decrease in the interest rate or the value of the principal at maturity. The","page_number":431,"box":{"x":117,"y":754,"width":763,"height":12}},{"id":"1b780c48-9a79-4da8-936b-8330f0d23e7c","block_type":"box","text":"rate of return on structured notes may be determined by applying a multiplier to the performance or","page_number":431,"box":{"x":117,"y":769,"width":735,"height":12}},{"id":"0c833a1c-40a5-4cc6-bfd8-bc1925a4fe78","block_type":"box","text":"differential performance of reference measures. Application of a multiplier involves leverage that will","page_number":431,"box":{"x":116,"y":785,"width":741,"height":12}},{"id":"33e34083-1c9b-4136-b602-f9b57bc40045","block_type":"box","text":"serve to magnify the potential for gain and the risk of loss.","page_number":431,"box":{"x":116,"y":800,"width":429,"height":12}},{"id":"8fdf7609-973d-4b4f-a5cc-1019497eaf0c","block_type":"box","text":"The purchase of structured notes exposes a Fund to the credit risk of the issuer of the structured","page_number":431,"box":{"x":116,"y":831,"width":722,"height":12}},{"id":"db7c5a06-bbbc-492b-8ab8-7bff217f09f6","block_type":"box","text":"product. Structured notes may also be more volatile, less liquid, and more difficult to price accurately","page_number":431,"box":{"x":117,"y":847,"width":750,"height":12}},{"id":"02551805-b81e-4f25-9f50-8254766eb3be","block_type":"box","text":"than less complex securities and instruments or more traditional debt securities. The secondary market","page_number":431,"box":{"x":116,"y":862,"width":770,"height":12}},{"id":"01c561dd-45ed-4c55-9204-c22c50e3b1c1","block_type":"box","text":"for structured notes could be illiquid making them difficult to sell when the Fund determines to sell","page_number":431,"box":{"x":116,"y":878,"width":729,"height":12}},{"id":"b636a458-ab8e-4c77-bc1a-0b04eac18356","block_type":"box","text":"II-99","page_number":431,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"5cf12760-6fa4-4454-aaad-748121c5a7c5","block_type":"box","text":"NM1026U-6004382-431/605","page_number":431,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5de835b4-d51e-4f13-b4a3-92073fd708f5","block_type":"box","text":"them. The possible lack of a liquid secondary market for structured notes and the resulting inability of","page_number":432,"box":{"x":116,"y":87,"width":755,"height":12}},{"id":"fe069112-eeb9-4238-8bbd-c70530dfd289","block_type":"box","text":"the Fund to sell a structured note could expose the Fund to losses and could make structured notes","page_number":432,"box":{"x":116,"y":103,"width":746,"height":11}},{"id":"95615ac7-2698-41c6-9956-a8426e80e4e7","block_type":"box","text":"more difficult for the Fund to value accurately.","page_number":432,"box":{"x":117,"y":118,"width":344,"height":12}},{"id":"91456d9c-6c40-4b01-a41d-030221bebcac","block_type":"box","text":"Taxability Risk.","page_number":432,"box":{"x":118,"y":149,"width":119,"height":12}},{"id":"b7ccde84-063d-4128-9154-69ea43662a76","block_type":"box","text":"Certain of the Funds intend to minimize the payment of taxable income to","page_number":432,"box":{"x":238,"y":149,"width":555,"height":12}},{"id":"e73bcd0a-befb-443e-a443-4be2e7184bc4","block_type":"box","text":"shareholders by investing in tax-exempt or municipal securities in reliance at the time of purchase on","page_number":432,"box":{"x":116,"y":165,"width":753,"height":12}},{"id":"8cda1e2b-8b6b-4cb2-a496-efa80bed1a70","block_type":"box","text":"an opinion of bond counsel to the issuer and, in the case of derivative securities, sponsors’ counsel,","page_number":432,"box":{"x":116,"y":180,"width":745,"height":12}},{"id":"3e94fd66-930d-453f-8ff0-41c551911c4a","block_type":"box","text":"that the interest paid on those securities will be excludable from gross income for U.S. federal income","page_number":432,"box":{"x":116,"y":196,"width":759,"height":12}},{"id":"6967c819-ddd7-43b6-9921-03566f351216","block_type":"box","text":"tax purposes. Such securities, however, may be determined to pay, or have paid, taxable income","page_number":432,"box":{"x":116,"y":211,"width":726,"height":12}},{"id":"ee6d9a01-c383-45c8-9975-bb7abea995ca","block_type":"box","text":"subsequent to the Fund’s acquisition of the securities. In that event, the IRS may demand that the","page_number":432,"box":{"x":116,"y":227,"width":731,"height":12}},{"id":"d798619c-6dc7-4c35-a727-a7cd25a61138","block_type":"box","text":"Fund pay U.S. federal income taxes on the affected interest income, and, if the Fund agrees to do so,","page_number":432,"box":{"x":117,"y":242,"width":758,"height":12}},{"id":"d6f45520-0ecb-405a-8f4c-1cb1a99186bd","block_type":"box","text":"the Fund’s yield could be adversely affected. In addition, the treatment of dividends previously paid or","page_number":432,"box":{"x":116,"y":258,"width":758,"height":12}},{"id":"d6fc7cdc-5298-4573-81d1-e1cb1dbc3397","block_type":"box","text":"to be paid by the Fund as “exempt interest dividends” could be adversely affected, subjecting the","page_number":432,"box":{"x":116,"y":273,"width":724,"height":12}},{"id":"b361bf76-219f-4032-94dc-a65e6eed6451","block_type":"box","text":"Fund’s shareholders to increased U.S. federal income tax liabilities. If the interest paid on any","page_number":432,"box":{"x":117,"y":289,"width":699,"height":12}},{"id":"b698fa40-1d96-42e6-bc8e-48f8e3b8a242","block_type":"box","text":"tax-exempt or municipal security held by the Fund is subsequently determined to be taxable, the Fund","page_number":432,"box":{"x":116,"y":304,"width":762,"height":12}},{"id":"040c1fd1-2838-45ba-ac6a-8d39167cc27f","block_type":"box","text":"will dispose of that security as soon as reasonably practicable. In addition, future laws, regulations,","page_number":432,"box":{"x":116,"y":320,"width":738,"height":12}},{"id":"92fdf1c3-8120-4431-b4d0-30f11df53d55","block_type":"box","text":"rulings or court decisions may cause interest on municipal securities to be subject, directly or indirectly,","page_number":432,"box":{"x":117,"y":335,"width":769,"height":12}},{"id":"1cb6cc01-f1e8-46a6-a424-c4f206d230a8","block_type":"box","text":"to U.S. federal income taxation or interest on state municipal securities to be subject to state or local","page_number":432,"box":{"x":116,"y":351,"width":749,"height":12}},{"id":"69ad7794-d2d9-4f97-9d8b-3cf5e6bc8148","block_type":"box","text":"income taxation, or the value of state municipal securities to be subject to state or local intangible","page_number":432,"box":{"x":117,"y":366,"width":726,"height":12}},{"id":"5b459779-86fb-4871-a5f7-6ce995f10fdd","block_type":"box","text":"personal property tax, or may otherwise prevent the Fund from realizing the full current benefit of the","page_number":432,"box":{"x":117,"y":382,"width":750,"height":12}},{"id":"dd5393dd-532d-470e-960f-b0806d9e4500","block_type":"box","text":"tax-exempt status of such securities. Any such change could also affect the market price of such","page_number":432,"box":{"x":116,"y":397,"width":721,"height":12}},{"id":"1f3a2e57-96fd-4dfa-bcfd-d86320d7bb42","block_type":"box","text":"securities, and thus the value of an investment in the Fund.","page_number":432,"box":{"x":116,"y":413,"width":444,"height":11}},{"id":"0db845b9-827b-4fd6-904e-0ebae9cb3862","block_type":"box","text":"Temporary Defensive Measures.","page_number":432,"box":{"x":118,"y":444,"width":255,"height":12}},{"id":"66df3d5e-bace-4216-aa73-038a8cf15c1a","block_type":"box","text":"As a temporary defensive measure, including to respond to adverse","page_number":432,"box":{"x":374,"y":444,"width":514,"height":12}},{"id":"1111403f-5295-40bb-a419-ace964e65888","block_type":"box","text":"market, economic, political or other conditions, a Fund may depart from its principal investment","page_number":432,"box":{"x":117,"y":459,"width":709,"height":12}},{"id":"f7d0d4bb-4d64-4b24-a46a-0b18aa3a2a7e","block_type":"box","text":"strategies and may invest without limitation in cash, high quality money market instruments, or other","page_number":432,"box":{"x":116,"y":475,"width":747,"height":12}},{"id":"2836c81d-c4fb-4b30-a62b-c09eecdaceb0","block_type":"box","text":"short term investments. Certain Funds may also invest in cash and other such instruments pending","page_number":432,"box":{"x":116,"y":490,"width":741,"height":12}},{"id":"71526bda-3d54-4a31-bb58-4cd378f931d3","block_type":"box","text":"investment or to meet anticipated redemption requests. High quality money market instruments include","page_number":432,"box":{"x":117,"y":506,"width":768,"height":12}},{"id":"7aa45919-4e1e-442c-972a-c91250ba041a","block_type":"box","text":"U.S. Government obligations, U.S. Government agency obligations, dollar denominated obligations of","page_number":432,"box":{"x":117,"y":521,"width":758,"height":12}},{"id":"c2cf1e2e-a63b-4d28-ae7b-6e13a8b04392","block_type":"box","text":"foreign issuers, bank obligations, including U.S. subsidiaries and branches of foreign banks, corporate","page_number":432,"box":{"x":116,"y":537,"width":763,"height":12}},{"id":"0e0039cf-8723-4a1a-b58f-b0bf6bfdb61e","block_type":"box","text":"obligations, commercial paper, repurchase agreements and obligations of supranational organizations.","page_number":432,"box":{"x":116,"y":552,"width":767,"height":12}},{"id":"8c8f4e0e-affc-4425-a3a2-e1d23c56b3c6","block_type":"box","text":"Generally, such obligations will mature within one year from the date of settlement but may mature","page_number":432,"box":{"x":117,"y":568,"width":735,"height":12}},{"id":"9bb54500-ab19-49c3-b3ff-76c7b3b20c81","block_type":"box","text":"within two years from the date of settlement. Temporary defensive measures may affect a Fund’s","page_number":432,"box":{"x":116,"y":583,"width":727,"height":12}},{"id":"43d2a012-3bd3-40ab-8b1b-794d98f1da21","block_type":"box","text":"ability to achieve its investment objective.","page_number":432,"box":{"x":116,"y":599,"width":312,"height":12}},{"id":"9a679c42-64fe-471f-9d3a-f98b92f92c49","block_type":"box","text":"U.S. Government Obligations.","page_number":432,"box":{"x":117,"y":630,"width":236,"height":12}},{"id":"d779228d-232b-4d23-ac79-9533ffae45c4","block_type":"box","text":"A Fund may purchase obligations issued or guaranteed by the U.S.","page_number":432,"box":{"x":354,"y":630,"width":510,"height":12}},{"id":"855013d7-72c6-40b6-a7a6-6afacef4582d","block_type":"box","text":"Government and U.S. Government agencies and instrumentalities. Obligations of certain agencies and","page_number":432,"box":{"x":117,"y":645,"width":767,"height":12}},{"id":"a7c83eb5-ce69-490b-b3fb-f6fb6ac86ac2","block_type":"box","text":"instrumentalities of the U.S. Government are supported by the full faith and credit of the U.S. Treasury.","page_number":432,"box":{"x":117,"y":661,"width":761,"height":12}},{"id":"e8487c42-df0d-4919-9ba3-da7cc5e1f0b5","block_type":"box","text":"Others are supported by the right of the issuer to borrow from the U.S. Treasury; and still others are","page_number":432,"box":{"x":116,"y":676,"width":740,"height":12}},{"id":"9145824f-19b1-4ac9-b10d-3dcbe6e849ab","block_type":"box","text":"supported only by the credit of the agency or instrumentality issuing the obligation. No assurance can","page_number":432,"box":{"x":116,"y":692,"width":751,"height":12}},{"id":"07d057c2-b7ba-4f83-8dea-ff8fbbb559d8","block_type":"box","text":"be given that the U.S. Government will provide financial support to U.S. Government-sponsored","page_number":432,"box":{"x":117,"y":707,"width":710,"height":12}},{"id":"6ab28b67-2b5f-4913-9f4d-0083378db585","block_type":"box","text":"instrumentalities if it is not obligated to do so by law. Certain U.S. Treasury and agency securities may","page_number":432,"box":{"x":117,"y":723,"width":757,"height":12}},{"id":"06b6c16c-a287-4959-a634-a5ed10dabdfd","block_type":"box","text":"be held by trusts that issue participation certificates (such as Treasury income growth receipts and","page_number":432,"box":{"x":117,"y":738,"width":728,"height":12}},{"id":"ccdac5b3-9d6f-4ce5-8de5-4348e25a6ee2","block_type":"box","text":"certificates of accrual on Treasury certificates). These certificates, as well as Treasury receipts and","page_number":432,"box":{"x":116,"y":754,"width":734,"height":12}},{"id":"6d22fc85-1916-4bec-8a14-cd734d0bab9b","block_type":"box","text":"other stripped securities, represent beneficial ownership interests in either future interest payments or","page_number":432,"box":{"x":116,"y":769,"width":754,"height":12}},{"id":"37c93399-236c-4c76-a01f-6155bee56559","block_type":"box","text":"the future principal payments on U.S. Government obligations. These instruments are issued at a","page_number":432,"box":{"x":116,"y":785,"width":721,"height":12}},{"id":"e2867cbb-12e6-44eb-accd-b31086dc277d","block_type":"box","text":"discount to their “face value” and may (particularly in the case of stripped mortgage-backed securities)","page_number":432,"box":{"x":116,"y":800,"width":758,"height":12}},{"id":"ad7437d5-0c52-4870-ac4c-be2ff181fbdf","block_type":"box","text":"exhibit greater price volatility than ordinary debt securities because of the manner in which their","page_number":432,"box":{"x":116,"y":816,"width":708,"height":12}},{"id":"518515de-4a61-44aa-a7dc-cbc0fb752c42","block_type":"box","text":"principal and interest are returned to investors.","page_number":432,"box":{"x":117,"y":831,"width":351,"height":12}},{"id":"11fce6ad-4875-4c4e-be48-9ded8e193043","block_type":"box","text":"Examples of the types of U.S. Government obligations that may be held by the Funds include U.S.","page_number":432,"box":{"x":117,"y":862,"width":734,"height":12}},{"id":"f06f5276-1657-4f1f-96c0-3adf40f7f311","block_type":"box","text":"Treasury Bills, Treasury Notes and Treasury Bonds and the obligations of the Federal Housing","page_number":432,"box":{"x":116,"y":878,"width":708,"height":12}},{"id":"4db304e6-e208-4332-8ac6-d588175126a3","block_type":"box","text":"II-100","page_number":432,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"0e2d3252-3e00-445a-a7ae-9ff6bfde047b","block_type":"box","text":"NM1026U-6004382-432/605","page_number":432,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c054c6ca-6628-4505-acc5-464d1d1f1457","block_type":"box","text":"Administration, Farmers Home Administration, Export-Import Bank of the United States, Small","page_number":433,"box":{"x":116,"y":87,"width":703,"height":12}},{"id":"40f048a2-e764-4069-a134-22f9b5b5a660","block_type":"box","text":"Business Administration, Ginnie Mae, Fannie Mae, Federal Financing Bank, General Services","page_number":433,"box":{"x":117,"y":102,"width":702,"height":13}},{"id":"22cec566-2bd0-4137-b019-a1e543e56aa5","block_type":"box","text":"Administration, Student Loan Marketing Association, Central Bank for Cooperatives, Federal Home","page_number":433,"box":{"x":116,"y":118,"width":741,"height":12}},{"id":"4cf9ba3b-88f9-4e49-ac25-34ba9add02ae","block_type":"box","text":"Loan Banks, Freddie Mac, Federal Intermediate Credit Banks, Federal Land Banks, Farm Credit Banks","page_number":433,"box":{"x":117,"y":134,"width":771,"height":11}},{"id":"0cbe59b5-14d5-4148-810c-0f1346152a74","block_type":"box","text":"System, Maritime Administration, Tennessee Valley Authority and Washington D.C. Armory Board. The","page_number":433,"box":{"x":116,"y":149,"width":772,"height":12}},{"id":"f330e7af-3b54-4dd9-b342-39020da4f7b9","block_type":"box","text":"Funds may also invest in mortgage-related securities issued or guaranteed by U.S. Government","page_number":433,"box":{"x":117,"y":165,"width":717,"height":12}},{"id":"a6b36698-f194-4330-b11b-4d6520c547be","block_type":"box","text":"agencies and instrumentalities, including such instruments as obligations of Ginnie Mae, Fannie Mae","page_number":433,"box":{"x":116,"y":180,"width":754,"height":12}},{"id":"3af368f3-d1c5-4cc7-a1e5-979096ab2b98","block_type":"box","text":"and Freddie Mac.","page_number":433,"box":{"x":116,"y":196,"width":135,"height":9}},{"id":"00e29c08-8050-4b31-bdca-26cde8c7188b","block_type":"box","text":"U.S. Treasury Obligations.","page_number":433,"box":{"x":117,"y":227,"width":194,"height":12}},{"id":"ea16b6f4-9b38-4161-899c-78b67178b31a","block_type":"box","text":"Treasury obligations may differ in their interest rates, maturities, times of","page_number":433,"box":{"x":313,"y":227,"width":548,"height":12}},{"id":"304b0212-8802-4e25-9b98-85c2bf0a466b","block_type":"box","text":"issuance and other characteristics. Obligations of U.S. Government agencies and authorities are","page_number":433,"box":{"x":117,"y":242,"width":721,"height":12}},{"id":"43e511d6-d0dd-43f8-b3b6-df903d55c925","block_type":"box","text":"supported by varying degrees of credit but generally are not backed by the full faith and credit of the","page_number":433,"box":{"x":116,"y":258,"width":747,"height":12}},{"id":"fba8df18-aafd-4c41-b5ed-8891d93175b9","block_type":"box","text":"U.S. Government. No assurance can be given that the U.S. Government will provide financial support","page_number":433,"box":{"x":117,"y":273,"width":758,"height":12}},{"id":"575cfabf-1261-4216-96c5-40c126807d35","block_type":"box","text":"to its agencies and authorities if it is not obligated by law to do so.","page_number":433,"box":{"x":116,"y":289,"width":493,"height":12}},{"id":"de8fe98a-5347-487e-b827-77addaa1e5c7","block_type":"box","text":"U.S. Treasury Rolls.","page_number":433,"box":{"x":117,"y":320,"width":153,"height":12}},{"id":"d0073d6f-6da0-40be-a530-7b4e37a5942d","block_type":"box","text":"Certain Funds may invest in U.S. Treasury","page_number":433,"box":{"x":271,"y":320,"width":320,"height":12}},{"id":"f17f8e67-ce7e-44a7-ab01-c4bb89af617a","block_type":"box","text":"rolls. In a U.S. Treasury roll transaction,","page_number":433,"box":{"x":592,"y":320,"width":292,"height":12}},{"id":"9ae029f0-d70d-45c6-95e7-bf55680d3d8f","block_type":"box","text":"the Fund sells a treasury security to a counterpa","page_number":433,"box":{"x":116,"y":335,"width":350,"height":12}},{"id":"557cf0c7-2dca-4ab6-89c7-afb63fcca209","block_type":"box","text":"rty with a simultaneous agreement to repurchase the","page_number":433,"box":{"x":468,"y":335,"width":387,"height":12}},{"id":"1ae53069-3c3b-40c3-b943-35eb027066a7","block_type":"box","text":"same security at an agreed upon price and future settl","page_number":433,"box":{"x":116,"y":351,"width":392,"height":12}},{"id":"e1578bf3-9ac4-456e-9847-ba3f6e2c8b47","block_type":"box","text":"ement date. U.S. Treasury roll transactions may","page_number":433,"box":{"x":510,"y":351,"width":353,"height":12}},{"id":"29459fc8-1e90-4348-8812-f80c19636bc0","block_type":"box","text":"incrementally adjust the average maturity of a Fund’","page_number":433,"box":{"x":117,"y":366,"width":376,"height":12}},{"id":"a1071a93-3984-4fc5-866f-a9e09273c373","block_type":"box","text":"s portfolio and increase the interest yield on the","page_number":433,"box":{"x":494,"y":366,"width":348,"height":12}},{"id":"7e77ae8d-70a2-4174-8c59-951e6acc000b","block_type":"box","text":"Fund’s portfolio by extending the average maturity of the portfolio in a normal yield curve environment.","page_number":433,"box":{"x":117,"y":382,"width":746,"height":12}},{"id":"fdf57793-1dbc-4646-8bd1-668d4f82007f","block_type":"box","text":"During the period before the settlement","page_number":433,"box":{"x":117,"y":397,"width":284,"height":12}},{"id":"f7af66f1-9fa8-4ced-bca7-0e29ce8fa16f","block_type":"box","text":"date of a U.S. Treasury roll, a","page_number":433,"box":{"x":401,"y":397,"width":224,"height":12}},{"id":"fd5be1cb-af9a-4f30-87c7-2cba9e91cff0","block_type":"box","text":"Fund continues to earn interest on","page_number":433,"box":{"x":626,"y":397,"width":254,"height":10}},{"id":"fbe9778d-e212-4048-a65b-820848f11c75","block_type":"box","text":"the securities it is selling; however, it does not earn in","page_number":433,"box":{"x":116,"y":413,"width":387,"height":12}},{"id":"0bba0340-4120-4c88-89f4-1637b06e1e18","block_type":"box","text":"terest on the securities it is purchasing until after the","page_number":433,"box":{"x":504,"y":413,"width":383,"height":12}},{"id":"f9a487e9-69c4-4c8c-be37-2fcc9f246aad","block_type":"box","text":"settlement date. A Fund could suffer an opportunity loss","page_number":433,"box":{"x":116,"y":428,"width":412,"height":12}},{"id":"b6c1ae45-9ffb-4445-933c-5bda3c0f8745","block_type":"box","text":"if the counterparty to the U.S. Treasury roll","page_number":433,"box":{"x":528,"y":428,"width":314,"height":12}},{"id":"362945a5-028d-43ed-b9e2-f0733a6d8fb3","block_type":"box","text":"transaction failed to perform its obligations on the settlement date.","page_number":433,"box":{"x":116,"y":444,"width":484,"height":12}},{"id":"dde2e75e-b879-43d1-afa6-60ef67e87ce8","block_type":"box","text":"The market value of the securities that a Fund is required to purchase may decline below the agreed","page_number":433,"box":{"x":116,"y":475,"width":751,"height":12}},{"id":"e7dda3d4-e613-4728-97e8-b7f1d31df8d9","block_type":"box","text":"upon purchase price of those securities. U.S. Treasury rolls are speculative techniques that can be","page_number":433,"box":{"x":117,"y":490,"width":737,"height":12}},{"id":"2ad693b6-8d2b-4ff0-9d7f-510a823e9ef4","block_type":"box","text":"deemed to involve leverage. There is no assurance that U.S. Treasury rolls can be successfully","page_number":433,"box":{"x":116,"y":506,"width":714,"height":12}},{"id":"83fd8e11-5f73-47e9-b6d0-2cff2aa94126","block_type":"box","text":"employed.","page_number":433,"box":{"x":116,"y":521,"width":82,"height":12}},{"id":"8e6a5197-6674-4995-9467-324082747825","block_type":"box","text":"Utility Industries.","page_number":433,"box":{"x":117,"y":552,"width":140,"height":12}},{"id":"94b86515-565f-499a-9cb3-208383a9adb7","block_type":"box","text":"Risks that are intrinsic to the utility industries include difficulty in obtaining an","page_number":433,"box":{"x":259,"y":552,"width":572,"height":12}},{"id":"a5c09391-49d6-4610-b980-3aa8d3d9e22f","block_type":"box","text":"adequate return on invested capital, difficulty in financing large construction programs during an","page_number":433,"box":{"x":116,"y":568,"width":715,"height":12}},{"id":"28232c5e-2da1-4da0-9bfc-7887814383a8","block_type":"box","text":"inflationary period, restrictions on operations and increased cost and delays attributable to","page_number":433,"box":{"x":117,"y":583,"width":672,"height":12}},{"id":"9d2eb2d3-739f-4ce6-bcf6-a13d5a87bfc2","block_type":"box","text":"environmental considerations and regulation, difficulty in raising capital in adequate amounts on","page_number":433,"box":{"x":116,"y":599,"width":715,"height":12}},{"id":"0cb1ae30-2b96-4689-9cb3-06d5b6a7371f","block_type":"box","text":"reasonable terms in periods of high inflation and unsettled capital markets, technological innovations","page_number":433,"box":{"x":117,"y":614,"width":750,"height":12}},{"id":"f290ab7e-b9d4-4ac0-89bc-6ca47482b43a","block_type":"box","text":"that may render existing plants, equipment or products obsolete, the potential impact of natural or","page_number":433,"box":{"x":116,"y":630,"width":729,"height":12}},{"id":"a90d1df1-bdfe-452c-9ca0-389ece657cb6","block_type":"box","text":"man-made disasters, increased costs and reduced availability of certain types of fuel, occasional","page_number":433,"box":{"x":117,"y":645,"width":721,"height":12}},{"id":"c656a861-1269-4305-b994-466b1dc5b45d","block_type":"box","text":"reduced availability and high costs of natural gas for resale, the effects of energy conservation, the","page_number":433,"box":{"x":117,"y":661,"width":731,"height":12}},{"id":"a1ae02ab-55b9-4921-89dd-5cd0ed0e77f0","block_type":"box","text":"effects of a national energy policy and lengthy delays and greatly increased costs and other problems","page_number":433,"box":{"x":116,"y":676,"width":753,"height":12}},{"id":"6639b5a1-1cc7-4ed2-b81e-f212ef103cef","block_type":"box","text":"associated with the design, construction, licensing, regulation and operation of nuclear facilities for","page_number":433,"box":{"x":116,"y":692,"width":730,"height":12}},{"id":"5ef598b5-d852-4afc-874c-fa18f7f67c10","block_type":"box","text":"electric generation, including, among other considerations, the problems associated with the use of","page_number":433,"box":{"x":116,"y":707,"width":736,"height":12}},{"id":"bf526251-ff2d-4af8-b9d5-816328587ddc","block_type":"box","text":"radioactive materials and the disposal of radioactive wastes. There are substantial differences among","page_number":433,"box":{"x":117,"y":723,"width":752,"height":12}},{"id":"24b272ad-8ca5-448c-9dad-05c189f04bb6","block_type":"box","text":"the regulatory practices and policies of various jurisdictions, and any given regulatory agency may","page_number":433,"box":{"x":116,"y":738,"width":727,"height":12}},{"id":"df1e1a2b-cdae-4061-9971-47f84de18466","block_type":"box","text":"make major shifts in policy from time to time. There is no assurance that regulatory authorities will, in","page_number":433,"box":{"x":117,"y":754,"width":746,"height":12}},{"id":"b2ae565f-01dc-49a6-92fd-c0b5075431f6","block_type":"box","text":"the future, grant rate increases or that such increases will be adequate to permit the payment of","page_number":433,"box":{"x":116,"y":769,"width":712,"height":12}},{"id":"0c48fb45-c89c-4874-9393-5794de97bb76","block_type":"box","text":"dividends on common stocks issued by a utility company. Additionally, existing and possible future","page_number":433,"box":{"x":116,"y":785,"width":730,"height":12}},{"id":"b52a2635-e73a-444d-9604-75681aa1dff6","block_type":"box","text":"regulatory legislation may make it even more difficult for utilities to obtain adequate relief. Certain of the","page_number":433,"box":{"x":117,"y":800,"width":765,"height":12}},{"id":"7a1733cb-89ae-40f4-8e67-6274fc389f58","block_type":"box","text":"issuers of securities held in the Fund’s portfolio may own or operate nuclear generating facilities.","page_number":433,"box":{"x":117,"y":816,"width":714,"height":12}},{"id":"1bc4bdc4-0867-4ea9-822a-a1e39faae41e","block_type":"box","text":"Governmental authorities may from time to time review existing policies and impose additional","page_number":433,"box":{"x":117,"y":831,"width":702,"height":12}},{"id":"3c00efbe-0255-4d0e-bdd4-0b686c3746fa","block_type":"box","text":"requirements governing the licensing, construction and operation of nuclear power plants. Prolonged","page_number":433,"box":{"x":117,"y":847,"width":751,"height":12}},{"id":"5ff2233f-737d-4360-b708-a4c3e90b5d26","block_type":"box","text":"changes in climatic conditions can also have a significant impact on both the revenues of an electric","page_number":433,"box":{"x":116,"y":862,"width":746,"height":12}},{"id":"8fc86124-7be5-4217-918a-3b034fc848b0","block_type":"box","text":"and gas utility as well as the expenses of a utility, particularly a hydro-based electric utility.","page_number":433,"box":{"x":116,"y":878,"width":675,"height":12}},{"id":"bc5100bb-0b17-4db2-89bb-89a5e0c4857c","block_type":"box","text":"II-101","page_number":433,"box":{"x":480,"y":909,"width":38,"height":9}},{"id":"7fa0dcc7-df9e-43a4-9a0f-406898c0b35e","block_type":"box","text":"NM1026U-6004382-433/605","page_number":433,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"84757b9a-9ac5-48b2-ac07-40cc90bfe8c4","block_type":"box","text":"Companies in the utilities sector may be adversely affected by changes in exchange rates, domestic","page_number":434,"box":{"x":117,"y":87,"width":747,"height":12}},{"id":"5aa1fb43-a4c4-4dd6-80fd-01f458beb0f1","block_type":"box","text":"and international competition, and governmental limitations on rates charged to customers. The value","page_number":434,"box":{"x":116,"y":103,"width":759,"height":12}},{"id":"b54d8571-f7ed-4f40-89a6-5a5d6fb6b565","block_type":"box","text":"of regulated utility debt securities and, to a lesser extent, equity securities, tends to have an inverse","page_number":434,"box":{"x":116,"y":118,"width":743,"height":12}},{"id":"88f9feac-56ef-4626-901d-17b7ea396851","block_type":"box","text":"relationship to the movement of interest rates and therefore may lead to volatility in performance.","page_number":434,"box":{"x":117,"y":134,"width":723,"height":12}},{"id":"bba536ee-d55e-41ff-b761-5a33073c8852","block_type":"box","text":"Utility companies in the United States and in foreign countries are generally subject to regulation. In the","page_number":434,"box":{"x":117,"y":165,"width":771,"height":12}},{"id":"3e751418-8e6b-476f-92c9-a293125bc766","block_type":"box","text":"United States, most utility companies are regulated by state and/or federal authorities. Such regulation","page_number":434,"box":{"x":117,"y":180,"width":764,"height":12}},{"id":"85405642-7865-4b32-ad56-6eda07b64ed4","block_type":"box","text":"is intended to ensure appropriate standards of service and adequate capacity to meet public demand.","page_number":434,"box":{"x":117,"y":196,"width":759,"height":12}},{"id":"726f54f3-9ffd-4164-8231-947fd3697763","block_type":"box","text":"Generally, prices are also regulated in the United States and in foreign countries with the intention of","page_number":434,"box":{"x":117,"y":211,"width":750,"height":12}},{"id":"8d6c6075-73c5-4b99-955d-cda5a8b704b0","block_type":"box","text":"protecting the public while ensuring that the rate of return earned by utility companies is sufficient to","page_number":434,"box":{"x":117,"y":227,"width":744,"height":12}},{"id":"3ee6a13b-b483-488d-9ddc-ef5691603b51","block_type":"box","text":"allow them to attract capital in order to grow and continue to provide appropriate services. There can","page_number":434,"box":{"x":116,"y":242,"width":751,"height":12}},{"id":"ff971901-54b5-4631-a10d-68e2431ef6c2","block_type":"box","text":"be no assurance that such pricing policies or rates of return will continue in the future.","page_number":434,"box":{"x":117,"y":258,"width":640,"height":12}},{"id":"48c118c1-513a-4cf6-ae90-ac33abf83494","block_type":"box","text":"The nature of regulation of the utility industries continues to evolve both in the United States and in","page_number":434,"box":{"x":116,"y":289,"width":738,"height":12}},{"id":"80db1bb4-23da-4020-9fba-29ebe142d48a","block_type":"box","text":"foreign countries. In recent years, changes in regulation in the United States increasingly have allowed","page_number":434,"box":{"x":116,"y":304,"width":767,"height":12}},{"id":"f0f10a25-1a81-4a8e-87c7-8a0ccac23ee8","block_type":"box","text":"utility companies to provide services and products outside their traditional geographic areas and lines","page_number":434,"box":{"x":117,"y":320,"width":755,"height":12}},{"id":"022f867f-db9d-46cd-b843-8617d599504c","block_type":"box","text":"of business, creating new areas of competition within the industries. In some instances, utility","page_number":434,"box":{"x":116,"y":335,"width":696,"height":12}},{"id":"e25b9309-6612-42ad-bbcb-8616f1136818","block_type":"box","text":"companies are operating on an unregulated basis. Because of trends toward deregulation and the","page_number":434,"box":{"x":116,"y":351,"width":732,"height":12}},{"id":"e079d294-d111-4e47-916f-bc4f3074a524","block_type":"box","text":"evolution of independent power producers as well as new entrants to the field of telecommunications,","page_number":434,"box":{"x":116,"y":366,"width":757,"height":12}},{"id":"3e0eb423-b813-4659-ad7a-bcd36d71356d","block_type":"box","text":"non-regulated providers of utility services have become a significant part of their respective industries.","page_number":434,"box":{"x":117,"y":382,"width":761,"height":12}},{"id":"cd7937c3-7274-49e4-99cc-b4139fec7e27","block_type":"box","text":"The Manager believes that the emergence of competition and deregulation will result in certain utility","page_number":434,"box":{"x":116,"y":397,"width":750,"height":12}},{"id":"fe51d64b-b0ce-4f62-ad3c-e6a4eee4e572","block_type":"box","text":"companies being able to earn more than their traditional regulated rates of return, while others may be","page_number":434,"box":{"x":116,"y":413,"width":764,"height":12}},{"id":"e7dcfde3-da05-45d6-aede-6437be4e4ce6","block_type":"box","text":"forced to defend their core business from increased competition and may be less profitable. Reduced","page_number":434,"box":{"x":116,"y":428,"width":757,"height":12}},{"id":"acb55750-772d-41cf-85da-2511108e071f","block_type":"box","text":"profitability, as well as new uses of funds (such as for expansion, operations or stock buybacks) could","page_number":434,"box":{"x":117,"y":444,"width":759,"height":12}},{"id":"1c06c44d-4945-4cc2-a76a-738651b06a04","block_type":"box","text":"result in cuts in dividend payout rates. As deregulation allows utility companies to diversify outside of","page_number":434,"box":{"x":117,"y":459,"width":750,"height":12}},{"id":"0b0e8afa-64f0-4950-b163-b327d99dcf16","block_type":"box","text":"their original geographic regions and their traditional lines of business, utilities companies may engage","page_number":434,"box":{"x":116,"y":475,"width":765,"height":12}},{"id":"33d7b62f-df71-40a2-a7de-de550bfb8ac8","block_type":"box","text":"in riskier ventures. Therefore, deregulation may eliminate restrictions on the maximum level of profits of","page_number":434,"box":{"x":117,"y":490,"width":771,"height":12}},{"id":"d0c31477-df10-4d82-9681-3171d231956d","block_type":"box","text":"certain utility companies, but may also subject these companies to greater risk of loss. The Manager","page_number":434,"box":{"x":116,"y":506,"width":749,"height":12}},{"id":"2fa37a6e-89b2-472b-a44e-99c3b3442d20","block_type":"box","text":"seeks to take advantage of favorable investment opportunities that may arise from these structural","page_number":434,"box":{"x":116,"y":521,"width":735,"height":12}},{"id":"c973acb1-1b9a-4457-8593-547eede82fd0","block_type":"box","text":"changes. Of course, there can be no assurance that favorable developments will occur in the future.","page_number":434,"box":{"x":116,"y":537,"width":747,"height":12}},{"id":"19639e91-8440-40db-86d5-cf4c9d716296","block_type":"box","text":"Foreign utility companies are also subject to regulation, although such regulations may or may not be","page_number":434,"box":{"x":117,"y":568,"width":755,"height":12}},{"id":"0d1873e0-5ad0-4cdf-8f91-d4f46d65c5d6","block_type":"box","text":"comparable to those in the United States. Foreign utility companies may be more heavily regulated by","page_number":434,"box":{"x":116,"y":583,"width":761,"height":12}},{"id":"ba1793b6-ecfc-40f3-80e6-ec8799349dd7","block_type":"box","text":"their respective governments than utilities in the United States and, as in the United States, generally","page_number":434,"box":{"x":116,"y":599,"width":755,"height":12}},{"id":"725c8780-12a3-44b4-973f-0bffdd22590c","block_type":"box","text":"are required to seek government approval for rate increases. In addition, many foreign utilities use","page_number":434,"box":{"x":116,"y":614,"width":733,"height":12}},{"id":"8b82b705-7431-423e-b32f-ff78a8398971","block_type":"box","text":"fuels that may cause more pollution than those used in the United States, which may require such","page_number":434,"box":{"x":116,"y":630,"width":731,"height":12}},{"id":"d5b4f4d8-8b19-4a81-b674-ce6a14435f94","block_type":"box","text":"utilities to invest in pollution control equipment to meet any proposed pollution restrictions. Foreign","page_number":434,"box":{"x":117,"y":645,"width":733,"height":12}},{"id":"f2a07a75-e01b-44a9-ad59-a5eb1314197f","block_type":"box","text":"regulatory systems vary from country to country and may evolve in ways different from regulation in the","page_number":434,"box":{"x":117,"y":661,"width":765,"height":12}},{"id":"8eba8a8a-226f-4ba0-9e4e-5e23f18159af","block_type":"box","text":"United States.","page_number":434,"box":{"x":117,"y":676,"width":103,"height":10}},{"id":"888a877b-6a66-4b3f-9855-3db7d7d8d7d0","block_type":"box","text":"A Fund’s investment policies are designed to enable it to capitalize on evolving investment opportunities","page_number":434,"box":{"x":116,"y":707,"width":764,"height":12}},{"id":"ef83334a-f22c-49ef-868c-e5da95320b57","block_type":"box","text":"throughout the world. For example, the rapid growth of certain foreign economies will necessitate","page_number":434,"box":{"x":116,"y":723,"width":712,"height":12}},{"id":"a2063a52-27a7-4a65-8f9f-a1db407c1233","block_type":"box","text":"expansion of capacity in the utility industries in those countries. Although many foreign utility companies","page_number":434,"box":{"x":116,"y":738,"width":762,"height":12}},{"id":"5a758798-e241-4b2f-8743-e93710404987","block_type":"box","text":"currently are government-owned, thereby limiting current investment opportunities for a Fund, the","page_number":434,"box":{"x":116,"y":754,"width":715,"height":12}},{"id":"eaacb349-c0fc-482c-b9bb-fbde5d24e41e","block_type":"box","text":"Manager believes that, in order to attract significant capital for growth, foreign governments are likely to","page_number":434,"box":{"x":117,"y":769,"width":757,"height":12}},{"id":"f7576da4-230e-4b5d-86b6-ec9744119864","block_type":"box","text":"seek global investors through the privatization of their utility industries. Privatization, which refers to the","page_number":434,"box":{"x":116,"y":785,"width":757,"height":12}},{"id":"eb2568a6-ed99-44d5-9f6a-7ff4c30c5fd2","block_type":"box","text":"trend toward investor ownership of assets rather than government ownership, is expected to occur in","page_number":434,"box":{"x":116,"y":800,"width":739,"height":12}},{"id":"782e115d-d00f-423b-847b-bfbe5d87ba7e","block_type":"box","text":"newer, faster-growing economies and in mature economies. Of course, there is no assurance that such","page_number":434,"box":{"x":117,"y":816,"width":757,"height":12}},{"id":"c4ed43cf-44ee-4d68-a040-e2d94943cbed","block_type":"box","text":"favorable developments will occur or that investment opportunities in foreign markets will increase.","page_number":434,"box":{"x":116,"y":831,"width":728,"height":12}},{"id":"1c1b6fee-3430-4272-9ab3-46099cbefcc5","block_type":"box","text":"The revenues of domestic and foreign utility companies generally reflect the economic growth and","page_number":434,"box":{"x":116,"y":862,"width":732,"height":12}},{"id":"ae6b7f2b-bd39-4776-82f5-008738fa3dcb","block_type":"box","text":"development in the geographic areas in which they do business. The Manager will take into account","page_number":434,"box":{"x":116,"y":878,"width":747,"height":12}},{"id":"27f17560-2997-41eb-bdb6-a9854880616d","block_type":"box","text":"II-102","page_number":434,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"84960430-c3e2-4c98-aa96-2311a2fb7a5a","block_type":"box","text":"NM1026U-6004382-434/605","page_number":434,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a2b88124-a7e6-4f00-8441-869018f55d29","block_type":"box","text":"anticipated economic growth rates and other economic developments when selecting securities of","page_number":435,"box":{"x":116,"y":87,"width":732,"height":12}},{"id":"4637a1a3-dc8c-4f94-8541-e359b304b3e1","block_type":"box","text":"utility companies.","page_number":435,"box":{"x":117,"y":103,"width":132,"height":12}},{"id":"3b19fbe3-7298-4381-863b-ab53b75adfd0","block_type":"box","text":"Electric.","page_number":435,"box":{"x":116,"y":134,"width":58,"height":9}},{"id":"aeb73218-8b75-4b04-89ff-e6b27b8d8ecd","block_type":"box","text":"The electric utility industry consists of companies that are engaged principally in the","page_number":435,"box":{"x":176,"y":134,"width":630,"height":12}},{"id":"fb399901-dec0-4f86-a189-a29582f46246","block_type":"box","text":"generation, transmission and sale of electric energy, although many also provide other energy-related","page_number":435,"box":{"x":116,"y":149,"width":760,"height":12}},{"id":"b4978848-407d-4510-8397-dc04d7b83d6f","block_type":"box","text":"services. In the past, electric utility companies, in general, have been favorably affected by lower fuel","page_number":435,"box":{"x":116,"y":165,"width":754,"height":12}},{"id":"11db8514-1f33-47f2-9bb6-9ac9cd71b6cd","block_type":"box","text":"and financing costs and the full or near completion of major construction programs. In addition, many","page_number":435,"box":{"x":116,"y":180,"width":754,"height":12}},{"id":"d3a31484-e885-4658-9e1d-847b2ec587dc","block_type":"box","text":"of these companies have generated cash flows in excess of current operating expenses and","page_number":435,"box":{"x":116,"y":196,"width":690,"height":12}},{"id":"73e36d91-826a-45d9-96e4-817010fe6bb3","block_type":"box","text":"construction expenditures, permitting some degree of diversification into unregulated businesses.","page_number":435,"box":{"x":116,"y":211,"width":727,"height":12}},{"id":"20d1b729-0ad6-49b8-aa71-70e7dd80fbb9","block_type":"box","text":"Some electric utilities have also taken advantage of the right to sell power outside of their traditional","page_number":435,"box":{"x":116,"y":227,"width":744,"height":12}},{"id":"9bcf61f8-871c-413d-9649-bf529da50002","block_type":"box","text":"geographic areas. Electric utility companies have historically been subject to the risks associated with","page_number":435,"box":{"x":116,"y":242,"width":758,"height":12}},{"id":"dd7970a7-137f-4d6f-a1d1-614901a47a8c","block_type":"box","text":"increases in fuel and other operating costs, high interest costs on borrowings needed for capital","page_number":435,"box":{"x":117,"y":258,"width":714,"height":12}},{"id":"debcd029-ef5f-475e-95db-41884a831c43","block_type":"box","text":"construction programs, costs associated with compliance with environmental and safety regulations","page_number":435,"box":{"x":116,"y":273,"width":744,"height":12}},{"id":"7b8b5467-c1db-40a4-bc0b-c53582c0ff71","block_type":"box","text":"and changes in the regulatory climate. As interest rates declined, many utilities refinanced high cost","page_number":435,"box":{"x":116,"y":289,"width":744,"height":12}},{"id":"7d79dcbf-972e-4e85-a901-91b7ca1e9c0e","block_type":"box","text":"debt and in doing so improved their fixed charges coverage. Regulators, however, lowered allowed","page_number":435,"box":{"x":116,"y":304,"width":740,"height":12}},{"id":"3ab52134-ce4e-4e15-8ea1-d01a09ce9898","block_type":"box","text":"rates of return as interest rates declined and thereby caused the benefits of the rate declines to be","page_number":435,"box":{"x":117,"y":320,"width":734,"height":12}},{"id":"a41cbb4f-1ddc-4102-9924-1ebc120d092b","block_type":"box","text":"shared wholly or in part with customers. In a period of rising interest rates, the allowed rates of return","page_number":435,"box":{"x":116,"y":335,"width":754,"height":12}},{"id":"bafaffe9-6fea-48ed-8046-6aff087bd980","block_type":"box","text":"may not keep pace with the utilities’ increased costs. The construction and operation of nuclear power","page_number":435,"box":{"x":117,"y":351,"width":760,"height":12}},{"id":"81800b4f-0391-4f38-8001-198d03e42535","block_type":"box","text":"facilities are subject to strict scrutiny by, and evolving regulations of, the Nuclear Regulatory","page_number":435,"box":{"x":116,"y":366,"width":686,"height":12}},{"id":"9b8a9b5c-5e32-446e-b2e6-15a226f71aaa","block_type":"box","text":"Commission and state agencies which have comparable jurisdiction. Strict scrutiny might result in","page_number":435,"box":{"x":117,"y":382,"width":727,"height":12}},{"id":"b0ac51d2-0c2b-41e9-b9f5-aec5f06a9341","block_type":"box","text":"higher operating costs and higher capital expenditures, with the risk that the regulators may disallow","page_number":435,"box":{"x":117,"y":397,"width":747,"height":12}},{"id":"dcc49820-5715-4dca-99c5-f8e26379dd1a","block_type":"box","text":"inclusion of these costs in rate authorizations or the risk that a company may not be permitted to","page_number":435,"box":{"x":117,"y":413,"width":719,"height":12}},{"id":"ea319341-90de-42d8-ab53-7a0294874421","block_type":"box","text":"operate or complete construction of a facility. In addition, operators of nuclear power plants may be","page_number":435,"box":{"x":116,"y":428,"width":740,"height":12}},{"id":"4cf4684c-8bc9-4980-8720-c7795c5eb54a","block_type":"box","text":"subject to significant costs for disposal of nuclear fuel and for decommissioning such plants.","page_number":435,"box":{"x":116,"y":444,"width":687,"height":12}},{"id":"27f01b13-f37b-42c2-9487-555e315e3bda","block_type":"box","text":"The rating agencies look closely at the business profile of utilities. Ratings for companies are expected","page_number":435,"box":{"x":116,"y":475,"width":766,"height":12}},{"id":"69ff0b9b-038e-417c-a8db-17e489504f6f","block_type":"box","text":"to be impacted to a greater extent in the future by the division of their asset base. Electric utility","page_number":435,"box":{"x":116,"y":490,"width":711,"height":12}},{"id":"eeb2101b-ff13-4c64-bb1a-6168f90a734d","block_type":"box","text":"companies that focus more on the generation of electricity may be assigned less favorable ratings as","page_number":435,"box":{"x":116,"y":506,"width":754,"height":12}},{"id":"d0d2a5a8-8deb-47c8-b3e4-41dd39f99d75","block_type":"box","text":"this business is expected to be competitive and the least regulated. On the other hand, companies that","page_number":435,"box":{"x":116,"y":521,"width":768,"height":12}},{"id":"5147652d-527e-42d2-9ec7-9375528cc915","block_type":"box","text":"focus on transmission and distribution, which is expected to be the least competitive and the more","page_number":435,"box":{"x":116,"y":537,"width":732,"height":12}},{"id":"eeca2cef-987e-4534-a946-7244713b3304","block_type":"box","text":"regulated part of the business, may see higher ratings given the greater predictability of cash flow.","page_number":435,"box":{"x":117,"y":552,"width":732,"height":12}},{"id":"75f78eea-4c9c-4315-8783-8362ff15d24c","block_type":"box","text":"A number of states are considering or have enacted deregulation proposals. The introduction of","page_number":435,"box":{"x":116,"y":583,"width":715,"height":12}},{"id":"c52d7293-9e14-4e46-9cd4-5f8e0842fc09","block_type":"box","text":"competition into the industry as a result of such deregulation has at times resulted in lower revenue,","page_number":435,"box":{"x":116,"y":599,"width":746,"height":12}},{"id":"84d4b431-4073-4897-86ac-03e49afd1003","block_type":"box","text":"lower credit ratings, increased default risk, and lower electric utility security prices. Such increased","page_number":435,"box":{"x":117,"y":614,"width":734,"height":12}},{"id":"78c5fe15-d16a-4292-b6d0-87a0adc3c330","block_type":"box","text":"competition may also cause long-term contracts, which electric utilities previously entered into to buy","page_number":435,"box":{"x":116,"y":630,"width":752,"height":12}},{"id":"0a138663-f510-41a4-a0d7-e9bbc5da18db","block_type":"box","text":"power, to become “stranded assets” which have no economic value. Any loss associated with such","page_number":435,"box":{"x":117,"y":645,"width":739,"height":12}},{"id":"3baa4db8-aa75-4411-9edd-bb754e0ea913","block_type":"box","text":"contracts must be absorbed by ratepayers and investors. In addition, some electric utilities have","page_number":435,"box":{"x":116,"y":661,"width":711,"height":12}},{"id":"a1c5a9ac-4fa9-4aab-86be-176d358e9db0","block_type":"box","text":"acquired electric utilities overseas to diversify, enhance earnings and gain experience in operating in a","page_number":435,"box":{"x":116,"y":676,"width":759,"height":12}},{"id":"802ddcc0-e026-4056-b4b4-d1c9a62be2a6","block_type":"box","text":"deregulated environment. In some instances, such acquisitions have involved significant borrowings,","page_number":435,"box":{"x":116,"y":692,"width":746,"height":12}},{"id":"0303ca0b-98cf-41a4-9871-bf758981d2a0","block_type":"box","text":"which have burdened the acquirer’s balance sheet. There is no assurance that current deregulation","page_number":435,"box":{"x":116,"y":707,"width":737,"height":12}},{"id":"38b76c72-f315-4cca-a05d-efbe9d077876","block_type":"box","text":"proposals will be adopted. However, deregulation in any form could significantly impact the electric","page_number":435,"box":{"x":117,"y":723,"width":731,"height":12}},{"id":"5ce68be8-c5b8-4fc1-8db3-3e9eb9c3b06c","block_type":"box","text":"utilities industry.","page_number":435,"box":{"x":117,"y":738,"width":117,"height":12}},{"id":"01b0c0af-ddaa-44d6-b055-4ffa44c4d876","block_type":"box","text":"Telecommunications.","page_number":435,"box":{"x":118,"y":769,"width":155,"height":10}},{"id":"9c3e6930-d0a4-4f5e-9786-b74723fb4591","block_type":"box","text":"The telecommunications industry today includes both traditional telephone","page_number":435,"box":{"x":280,"y":769,"width":551,"height":12}},{"id":"7e430409-8d25-4c8a-adeb-e8f465618663","block_type":"box","text":"companies, with a history of broad market coverage and highly regulated businesses, and cable","page_number":435,"box":{"x":116,"y":785,"width":712,"height":12}},{"id":"b41962f4-9d25-4c20-9ed5-5089d5f29452","block_type":"box","text":"companies, which began as small, lightly regulated businesses focused on limited markets. Today","page_number":435,"box":{"x":116,"y":800,"width":728,"height":12}},{"id":"bc47e7c4-bfd3-45df-98ae-15a41e2fdae1","block_type":"box","text":"these two historically different businesses are converging in an industry that is trending toward larger,","page_number":435,"box":{"x":116,"y":816,"width":751,"height":12}},{"id":"544c81c0-f08d-40ce-b68c-3b7ea21c86df","block_type":"box","text":"competitive national and international markets with an emphasis on deregulation. Companies that","page_number":435,"box":{"x":116,"y":831,"width":729,"height":12}},{"id":"b7335401-a73a-40bc-a457-a795c0944f5e","block_type":"box","text":"distribute telephone services and provide access to the telephone networks still comprise the greatest","page_number":435,"box":{"x":116,"y":847,"width":760,"height":12}},{"id":"46785409-aacb-437e-9072-02695baab0aa","block_type":"box","text":"portion of this segment, but non-regulated activities such as wireless telephone services, paging, data","page_number":435,"box":{"x":117,"y":862,"width":759,"height":12}},{"id":"494225c1-5056-40f4-8104-6e96c2d32888","block_type":"box","text":"transmission and processing, equipment retailing, computer software and hardware and internet","page_number":435,"box":{"x":116,"y":878,"width":718,"height":12}},{"id":"79659781-65cb-4225-8278-202783504065","block_type":"box","text":"II-103","page_number":435,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"a7810f57-b918-44f4-9890-73f577874c72","block_type":"box","text":"NM1026U-6004382-435/605","page_number":435,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3b94adb4-5369-40ff-b1fa-5d5b02f6e1a0","block_type":"box","text":"services are becoming increasingly significant components as well. In particular, wireless and internet","page_number":436,"box":{"x":116,"y":87,"width":759,"height":12}},{"id":"7b60365c-ff20-42fb-a6a3-0a1e519c2621","block_type":"box","text":"telephone services continue to gain market share at the expense of traditional telephone companies.","page_number":436,"box":{"x":116,"y":102,"width":752,"height":13}},{"id":"2ef2baef-8b3e-4c5b-8681-c3798682c1aa","block_type":"box","text":"The presence of unregulated companies in this industry and the entry of traditional telephone","page_number":436,"box":{"x":116,"y":118,"width":696,"height":12}},{"id":"6d80846b-0630-4e99-aed9-308f7cf1e6c9","block_type":"box","text":"companies into unregulated or less regulated businesses provide significant investment opportunities","page_number":436,"box":{"x":116,"y":134,"width":755,"height":12}},{"id":"c823722e-a8ea-441e-8b89-62d97496777e","block_type":"box","text":"with companies that may increase their earnings at faster rates than had been allowed in traditional","page_number":436,"box":{"x":116,"y":149,"width":742,"height":12}},{"id":"bc373d5e-9225-49b0-a7c2-8e011f2ab5d2","block_type":"box","text":"regulated businesses. Still, increasing competition, technological innovations and other structural","page_number":436,"box":{"x":117,"y":165,"width":722,"height":12}},{"id":"2550480f-cf0b-4b5b-825c-545186a125ae","block_type":"box","text":"changes could adversely affect the profitability of such utilities and the growth rate of their dividends.","page_number":436,"box":{"x":116,"y":180,"width":750,"height":12}},{"id":"a0da9317-a30f-4c3a-aefa-758f93ae0c72","block_type":"box","text":"Given mergers and proposed legislation and enforcement changes, it is likely that both traditional","page_number":436,"box":{"x":117,"y":196,"width":725,"height":12}},{"id":"0a5cb498-f935-42e1-be33-99e98237e7ca","block_type":"box","text":"telephone companies and cable companies will continue to provide an expanding range of utility","page_number":436,"box":{"x":116,"y":211,"width":718,"height":12}},{"id":"098b0aee-3ae3-4c12-bc69-23b54e84a27d","block_type":"box","text":"services to both residential, corporate and governmental customers.","page_number":436,"box":{"x":116,"y":227,"width":511,"height":12}},{"id":"52dfbd4e-eef4-4af7-ad88-40f849359701","block_type":"box","text":"Gas.","page_number":436,"box":{"x":117,"y":255,"width":32,"height":9}},{"id":"591ca05b-da47-4335-b9b2-9a41af14299b","block_type":"box","text":"Gas transmission companies and gas distribution","page_number":436,"box":{"x":150,"y":255,"width":360,"height":12}},{"id":"cfe068cc-3985-4475-8104-49f36a4529ef","block_type":"box","text":"companies are undergoing significant changes. In","page_number":436,"box":{"x":510,"y":255,"width":359,"height":12}},{"id":"017e7e59-4fa3-4a22-bc6d-c0b126e5be89","block_type":"box","text":"the United States, interstate transmission companies","page_number":436,"box":{"x":116,"y":270,"width":375,"height":12}},{"id":"277050d5-7ba8-49fc-b31e-5f74b3b07eb3","block_type":"box","text":"are regulated by the Federal Energy Regulatory","page_number":436,"box":{"x":491,"y":271,"width":349,"height":11}},{"id":"c3e1faea-067b-40ee-b939-c3081d9eba28","block_type":"box","text":"Commission, which is reducing its regulation of the i","page_number":436,"box":{"x":117,"y":286,"width":366,"height":12}},{"id":"9b019100-40e8-428c-9043-38eb930b7e02","block_type":"box","text":"ndustry. Many companies have diversified into oil and","page_number":436,"box":{"x":485,"y":286,"width":385,"height":12}},{"id":"45647199-ab91-499c-90f4-c20aa0c6418a","block_type":"box","text":"gas exploration and development, making returns more sensitive to energy prices. In the recent decade,","page_number":436,"box":{"x":116,"y":302,"width":744,"height":12}},{"id":"78657f53-01af-499c-a37c-831ee81b24b2","block_type":"box","text":"gas utility companies have been adversely affected by","page_number":436,"box":{"x":116,"y":317,"width":390,"height":12}},{"id":"acaab497-ccb0-4b24-a3fe-36de55e8cfe5","block_type":"box","text":"disruptions in the oil industry and have also been","page_number":436,"box":{"x":506,"y":317,"width":351,"height":12}},{"id":"de6f4b37-e383-4a27-a4f2-650ffb8fb564","block_type":"box","text":"affected by increased concentration and competit","page_number":436,"box":{"x":116,"y":332,"width":350,"height":13}},{"id":"9293c9f0-ae4b-4aed-97aa-55b95350a54b","block_type":"box","text":"ion. In the opinion of the Manager, however,","page_number":436,"box":{"x":467,"y":332,"width":318,"height":13}},{"id":"bfe3e88c-95fc-46bb-a266-bfcdfc64d795","block_type":"box","text":"environmental considerations could im","page_number":436,"box":{"x":116,"y":348,"width":273,"height":9}},{"id":"c9cc6910-4109-4b75-8d56-c6d65bc46b4c","block_type":"box","text":"prove the gas industry outlook in the future. For example, natural gas","page_number":436,"box":{"x":390,"y":348,"width":495,"height":12}},{"id":"7f279752-bfcf-4bcf-8a5b-bb9868eb5d92","block_type":"box","text":"is the cleanest of the hydrocarbon fuels, and this may result","page_number":436,"box":{"x":117,"y":363,"width":422,"height":13}},{"id":"7a2db32c-5967-4797-9dd9-44cb5b17e1aa","block_type":"box","text":"t in incremental shifts in fuel consumption toward","page_number":436,"box":{"x":539,"y":363,"width":347,"height":12}},{"id":"ba5c42fb-2349-40c5-bed0-510c35510a98","block_type":"box","text":"natural gas and away from oil and coal, even for electri","page_number":436,"box":{"x":117,"y":379,"width":387,"height":12}},{"id":"68280e42-a91c-404d-9fa5-eaef17be2fdc","block_type":"box","text":"city generation. However, technological or regulatory","page_number":436,"box":{"x":505,"y":379,"width":379,"height":12}},{"id":"3145b3aa-8c2a-49df-a715-76c119e5b6b9","block_type":"box","text":"changes within the industry may delay or prevent this result.","page_number":436,"box":{"x":116,"y":395,"width":430,"height":12}},{"id":"6d275acd-f593-425f-8943-7021141693fb","block_type":"box","text":"Water.","page_number":436,"box":{"x":118,"y":423,"width":46,"height":9}},{"id":"1885c5b8-2003-45ef-b2fd-69e1a47e03f6","block_type":"box","text":"Water supply utilities are companies that collect, purify, distribute and sell water. In the United","page_number":436,"box":{"x":165,"y":423,"width":706,"height":12}},{"id":"e34eee8c-56b3-4707-9bfb-85a9f0947a8d","block_type":"box","text":"States and around the world the industry is highly fragmented because most of the supplies are owned","page_number":436,"box":{"x":116,"y":438,"width":768,"height":12}},{"id":"d006ec01-f029-44f1-a62b-1923162ff62c","block_type":"box","text":"by local authorities. Companies in this industry are generally mature and are experiencing little or no","page_number":436,"box":{"x":117,"y":454,"width":748,"height":12}},{"id":"0a9fbe24-fc49-47ad-b594-ab57a010421c","block_type":"box","text":"per capita volume growth. In the opinion of the Manager, there may be opportunities for certain","page_number":436,"box":{"x":117,"y":469,"width":708,"height":12}},{"id":"cd4bdf89-a906-4513-a7e2-2a69bd6505b1","block_type":"box","text":"companies to acquire other water utility companies and for foreign acquisition of domestic companies.","page_number":436,"box":{"x":116,"y":485,"width":761,"height":12}},{"id":"f4c633c3-cfb7-4604-9b19-e2f45b54560e","block_type":"box","text":"The Manager believes that favorable investment opportunities may result from consolidation of this","page_number":436,"box":{"x":116,"y":500,"width":738,"height":12}},{"id":"eedbaf85-c46b-470c-a74c-1b69ea3a0682","block_type":"box","text":"segment. As with other utilities, however, increased regulation, increased costs and potential","page_number":436,"box":{"x":116,"y":516,"width":693,"height":12}},{"id":"393652f7-2a05-4e26-9b7f-f3b7e3658541","block_type":"box","text":"disruptions in supply may adversely affect investments in water supply utilities.","page_number":436,"box":{"x":116,"y":531,"width":588,"height":12}},{"id":"9aa00424-633f-4248-8fd7-d8f2c391a572","block_type":"box","text":"Utility Industries Generally.","page_number":436,"box":{"x":117,"y":560,"width":197,"height":12}},{"id":"bb8f8b69-85df-4189-98d4-f34f2f94eb56","block_type":"box","text":"There can be no assurance that the positive developments noted above,","page_number":436,"box":{"x":316,"y":560,"width":548,"height":12}},{"id":"c7a90f22-17bf-4653-83c3-c19f716ba057","block_type":"box","text":"including those relating to privatization and changing regulation, will occur or that risk factors other than","page_number":436,"box":{"x":117,"y":575,"width":771,"height":12}},{"id":"9fb422c8-99a4-4aac-a0ee-1e63c5cd1a32","block_type":"box","text":"those noted above will not develop in the future.","page_number":436,"box":{"x":116,"y":591,"width":361,"height":12}},{"id":"717e224a-4308-4ae0-9e76-89a6fb7f1e10","block_type":"box","text":"When-Issued Securities, Delayed Delivery Securities and Forward Commitments.","page_number":436,"box":{"x":118,"y":619,"width":643,"height":12}},{"id":"075c9d76-5c17-4e55-a36f-982d382b107d","block_type":"box","text":"A Fund may","page_number":436,"box":{"x":762,"y":619,"width":100,"height":12}},{"id":"feae13cf-17f3-4341-b20d-3b9de4d9c0f6","block_type":"box","text":"purchase or sell securities that it is entitled to receive on a when-issued basis. A Fund may also","page_number":436,"box":{"x":117,"y":635,"width":713,"height":12}},{"id":"244e0142-04a6-4efa-be9b-a9d7f1b54b89","block_type":"box","text":"purchase or sell securities on a delayed delivery basis or through a forward commitment (including on","page_number":436,"box":{"x":117,"y":650,"width":758,"height":12}},{"id":"4751391c-f660-4751-a0b0-0817012653fa","block_type":"box","text":"a TBA (to be announced) basis). These transactions involve the purchase or sale of securities by a","page_number":436,"box":{"x":116,"y":666,"width":734,"height":12}},{"id":"3d9bb254-5ed3-4ed3-b4aa-287ce71ba5ed","block_type":"box","text":"Fund at an established price with payment and delivery taking place in the future. The Fund enters into","page_number":436,"box":{"x":117,"y":681,"width":762,"height":12}},{"id":"fc714d67-49a5-41be-85ba-e91a680eec2c","block_type":"box","text":"these transactions to obtain what is considered an advantageous price to the Fund at the time of","page_number":436,"box":{"x":116,"y":697,"width":717,"height":12}},{"id":"0a0493b6-e4b6-437e-aa31-0c6958a5ad23","block_type":"box","text":"entering into the transaction.","page_number":436,"box":{"x":116,"y":712,"width":211,"height":12}},{"id":"21475171-4538-4a69-a294-9ea74d2517a9","block_type":"box","text":"Pursuant to recommendations of the Treasury Market Practices Group, which is sponsored by the","page_number":436,"box":{"x":117,"y":740,"width":725,"height":13}},{"id":"5e5f27b9-b75a-455c-9600-278755ff3666","block_type":"box","text":"Federal Reserve Bank of New York, a Fund or its counterparty generally will be required to post","page_number":436,"box":{"x":117,"y":756,"width":710,"height":12}},{"id":"34f3df13-c222-4406-b667-3c7fe9d721e2","block_type":"box","text":"collateral when entering into certain forward-settling transactions, including without limitation TBA","page_number":436,"box":{"x":116,"y":771,"width":722,"height":13}},{"id":"74e6d637-8bf4-45b1-85b5-59582894887f","block_type":"box","text":"transactions. FINRA rules have also been implemented that include mandatory margin requirements","page_number":436,"box":{"x":116,"y":787,"width":745,"height":12}},{"id":"32e86f34-d76e-4b7d-bf49-ffbbcdb4066d","block_type":"box","text":"for the TBA market with limited exceptions. The collateralization of TBA trades is intended to mitigate","page_number":436,"box":{"x":116,"y":802,"width":749,"height":13}},{"id":"ca22d657-197a-48b6-bdf2-ed8a275f8c47","block_type":"box","text":"counterparty credit risk between trade and settlement, but could increase the cost of TBA transactions","page_number":436,"box":{"x":116,"y":818,"width":757,"height":12}},{"id":"97398dc8-437c-4eb9-a733-8d6924c8ac12","block_type":"box","text":"and impose added operational complexity.","page_number":436,"box":{"x":116,"y":834,"width":320,"height":12}},{"id":"4746e7b8-7f29-4c3b-a93d-33f2350d133b","block_type":"box","text":"There can be no assurance that a security purchased on a when-issued basis will be issued or that a","page_number":436,"box":{"x":116,"y":862,"width":754,"height":12}},{"id":"fa035294-fe5d-4f7e-81eb-2858b1578418","block_type":"box","text":"security purchased or sold on a delayed delivery basis or through a forward commitment will be","page_number":436,"box":{"x":116,"y":877,"width":713,"height":12}},{"id":"8ead3c72-f509-400c-9457-5f51dd56867d","block_type":"box","text":"II-104","page_number":436,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"244540e4-0684-45cd-8863-66f40744d437","block_type":"box","text":"NM1026U-6004382-436/605","page_number":436,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"eb117254-5c75-4810-ad63-aebe610e85d1","block_type":"box","text":"delivered. Also, the value of securities in these transactions on the delivery date may be more or less","page_number":437,"box":{"x":116,"y":87,"width":755,"height":12}},{"id":"94148e41-eb66-40b4-aa94-4021d97db83c","block_type":"box","text":"than the price paid by the Fund to purchase the securities. The Fund will lose money if the value of the","page_number":437,"box":{"x":116,"y":102,"width":766,"height":13}},{"id":"8f20c862-f835-4f8a-84d8-4906374756a7","block_type":"box","text":"security in such a transaction declines below the purchase price and will not benefit if the value of the","page_number":437,"box":{"x":116,"y":118,"width":757,"height":12}},{"id":"4ea25a00-1cb8-410c-a5d5-acd2d076e8e1","block_type":"box","text":"security appreciates above the sale price during the commitment period.","page_number":437,"box":{"x":116,"y":134,"width":542,"height":12}},{"id":"543b8ba5-b9a2-44a9-9cd9-e26dcc850a9d","block_type":"box","text":"If deemed advisable as a matter of investment strategy, a Fund may dispose of or renegotiate a","page_number":437,"box":{"x":117,"y":165,"width":715,"height":12}},{"id":"c4051408-c4e3-48df-92f8-8219c3a2040b","block_type":"box","text":"commitment after it has been entered into, and may sell securities it has committed to purchase before","page_number":437,"box":{"x":116,"y":180,"width":767,"height":12}},{"id":"6f0e4f5f-d3d1-463b-9de9-fe5db1c5a348","block_type":"box","text":"those securities are delivered to the Fund on the settlement date. In these cases the Fund may realize","page_number":437,"box":{"x":116,"y":196,"width":764,"height":12}},{"id":"82a8983c-80af-4514-8797-2d67803d8a32","block_type":"box","text":"a taxable capital gain or loss.","page_number":437,"box":{"x":116,"y":211,"width":221,"height":12}},{"id":"318cdee3-3eeb-431c-a770-760a4fb6e466","block_type":"box","text":"When a Fund engages in when-issued, TBA or forward commitment transactions, it relies on the other","page_number":437,"box":{"x":116,"y":242,"width":763,"height":12}},{"id":"ced6ac1b-93c7-4cf3-9c6a-da9f7ff3b84b","block_type":"box","text":"party to consummate the trade. Failure of such party to do so may result in the Fund’s incurring a loss","page_number":437,"box":{"x":117,"y":258,"width":760,"height":12}},{"id":"b4a17d8e-d383-4587-b241-a629d19c9d71","block_type":"box","text":"or missing an opportunity to obtain a price considered to be advantageous.","page_number":437,"box":{"x":116,"y":273,"width":561,"height":12}},{"id":"c7c1672f-4d58-401f-ac9d-6adebd677649","block_type":"box","text":"The market value of the securities underlying a commitment to purchase securities, and any","page_number":437,"box":{"x":116,"y":304,"width":688,"height":12}},{"id":"f38d713b-ccdd-4589-84e7-8936d8f6b940","block_type":"box","text":"subsequent fluctuations in their market value, is taken into account when determining the market value","page_number":437,"box":{"x":116,"y":320,"width":767,"height":12}},{"id":"3a66291c-f03f-4daa-a741-c538f71a8ff0","block_type":"box","text":"of a Fund starting on the day the Fund agrees to purchase the securities. The Fund does not earn","page_number":437,"box":{"x":116,"y":335,"width":732,"height":12}},{"id":"ddd02822-b738-42c0-b1ff-fd7127077a8b","block_type":"box","text":"interest on the securities it has committed to purchase until they are paid for and delivered on the","page_number":437,"box":{"x":117,"y":351,"width":725,"height":12}},{"id":"2973b865-2f52-46a8-9e87-bafb335ebac3","block_type":"box","text":"settlement date.","page_number":437,"box":{"x":116,"y":366,"width":124,"height":10}},{"id":"aa64e468-f173-44c4-be48-7af27a4bac96","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into when-issued or forward","page_number":437,"box":{"x":117,"y":397,"width":740,"height":12}},{"id":"8d0eee45-7681-46c5-8113-da1ad5435095","block_type":"box","text":"settling securities (e.g., firm and standby commitments, including TBA commitments, and dollar rolls)","page_number":437,"box":{"x":116,"y":413,"width":753,"height":12}},{"id":"f063c372-ede6-4a08-9d45-e971d76ac9d4","block_type":"box","text":"and non-standard settlement cycle securities notwithstanding the limitation on the issuance of senior","page_number":437,"box":{"x":116,"y":428,"width":750,"height":12}},{"id":"61c8195e-c603-455a-94d6-6e9bfd69d031","block_type":"box","text":"securities in Section 18 of the Investment Company Act, provided that the Fund intends to physically","page_number":437,"box":{"x":116,"y":444,"width":750,"height":12}},{"id":"ad0fb2e1-bc86-47f9-9de9-2c10a07e34ac","block_type":"box","text":"settle the transaction and the transaction will settle within 35 days of its trade date (the “Delayed","page_number":437,"box":{"x":116,"y":459,"width":719,"height":12}},{"id":"e72637e8-c494-4165-a2ff-bc4523296bb7","block_type":"box","text":"Settlement Securities Provision”). If a when-issued, forward-settling or non-standard settlement cycle","page_number":437,"box":{"x":116,"y":475,"width":754,"height":12}},{"id":"8a769767-7c88-40ae-a2ee-f4a296e7620b","block_type":"box","text":"security does not satisfy the Delayed-Settlement Securities Provision, then it is treated as a Derivatives","page_number":437,"box":{"x":116,"y":490,"width":771,"height":12}},{"id":"f5165b69-0cbe-41e6-b8ed-a342eaff8f56","block_type":"box","text":"Transaction under Rule 18f-4. See “— Derivatives — Regulation of Derivatives — Rule 18f-4 under the","page_number":437,"box":{"x":116,"y":506,"width":770,"height":12}},{"id":"4729f65c-eb08-416a-869a-d79dccb5135e","block_type":"box","text":"Investment Company Act” above.","page_number":437,"box":{"x":117,"y":521,"width":252,"height":12}},{"id":"11e39a23-7ee2-48d1-a698-532f32c9a2d0","block_type":"box","text":"Regulations adopted by global prudential regulators require certain bank-regulated counterparties and","page_number":437,"box":{"x":117,"y":552,"width":761,"height":12}},{"id":"033ef125-7c8d-4aa2-8522-2849bc96bbb7","block_type":"box","text":"certain of their affiliates to include in certain financial contracts, including many agreements with","page_number":437,"box":{"x":116,"y":568,"width":716,"height":12}},{"id":"f6338245-d82e-4441-ae7c-ef2d37783c34","block_type":"box","text":"respect to when-issued, TBA and forward commitment transactions, terms that delay or restrict the","page_number":437,"box":{"x":117,"y":583,"width":736,"height":12}},{"id":"16ef4b58-85fa-4e2c-a856-f2550ca0ae03","block_type":"box","text":"rights of counterparties, such as a Fund, to terminate such agreements, foreclose upon collateral,","page_number":437,"box":{"x":117,"y":599,"width":728,"height":12}},{"id":"1da179aa-e5bd-47d5-bff6-294063f82bee","block_type":"box","text":"exercise other default rights or restrict transfers of credit support in the event that the counterparty and/","page_number":437,"box":{"x":116,"y":614,"width":766,"height":12}},{"id":"33003f49-8fbe-42e4-9a3e-450a2fad6252","block_type":"box","text":"or its affiliates are subject to certain types of resolution or insolvency proceedings. It is possible that","page_number":437,"box":{"x":116,"y":630,"width":744,"height":12}},{"id":"409d3d49-8e22-4682-9fa3-f507a2fd67b6","block_type":"box","text":"these requirements, as well as potential additional government regulation and other developments in","page_number":437,"box":{"x":116,"y":645,"width":752,"height":12}},{"id":"a8ae3090-7e41-4122-ae04-4e4abd17ed9e","block_type":"box","text":"the market, could adversely affect a Fund’s ability to terminate existing agreements with respect to","page_number":437,"box":{"x":116,"y":661,"width":730,"height":12}},{"id":"58abd52a-26b5-4c07-b44d-94a3e5b97879","block_type":"box","text":"these transactions or to realize amounts to be received under such agreements.","page_number":437,"box":{"x":116,"y":676,"width":593,"height":12}},{"id":"2c743a04-26a0-4bec-be77-bbf7d5362c5d","block_type":"box","text":"Yields and Ratings.","page_number":437,"box":{"x":118,"y":707,"width":152,"height":12}},{"id":"aabe7f5a-d8fb-4bb3-a9e2-b63cbddf8985","block_type":"box","text":"The yields on certain obligations are dependent on a variety of factors, including","page_number":437,"box":{"x":276,"y":707,"width":594,"height":12}},{"id":"d9cc9a04-a9ae-4bbc-9bc7-7441c0586593","block_type":"box","text":"general market conditions, conditions in the particular market for the obligation, the financial condition","page_number":437,"box":{"x":116,"y":723,"width":753,"height":12}},{"id":"52b847ae-caab-4f02-ae5c-a9cc49b9e9df","block_type":"box","text":"of the issuer, the size of the offering, the maturity of the obligation and the ratings of the issue. The","page_number":437,"box":{"x":116,"y":738,"width":732,"height":12}},{"id":"0521b266-769c-4316-aee8-54b3b9c7e59b","block_type":"box","text":"ratings of Moody’s, Fitch and S&P represent their respective opinions as to the quality of the","page_number":437,"box":{"x":117,"y":754,"width":683,"height":12}},{"id":"dea06eca-0c0a-421f-beb6-e515facb0a9c","block_type":"box","text":"obligations they undertake to rate. Ratings, however, are general and are not absolute standards of","page_number":437,"box":{"x":116,"y":769,"width":739,"height":12}},{"id":"c9d4e870-677c-4856-814f-463625ac2c31","block_type":"box","text":"quality. Consequently, obligations with the same rating, maturity and interest rate may have different","page_number":437,"box":{"x":116,"y":785,"width":744,"height":12}},{"id":"fa8c2c3e-bba9-46fa-9105-fd8a374cf8ba","block_type":"box","text":"market prices. Subsequent to its purchase by a Fund, a rated security may cease to be rated. A Fund’s","page_number":437,"box":{"x":117,"y":800,"width":764,"height":12}},{"id":"06339f9d-d756-49bb-b4d9-f752dc945ee5","block_type":"box","text":"Manager or sub-adviser will consider such an event in determining whether the Fund should continue","page_number":437,"box":{"x":117,"y":816,"width":750,"height":12}},{"id":"8ca0560a-908c-47a5-9d72-2380dedbe3ad","block_type":"box","text":"to hold the security.","page_number":437,"box":{"x":116,"y":831,"width":150,"height":12}},{"id":"f1c4d0e8-8c93-4ed3-9934-0b35d3ada86e","block_type":"box","text":"Zero Coupon Securities.","page_number":437,"box":{"x":116,"y":862,"width":193,"height":12}},{"id":"681dc018-1dc5-4d2e-8ea3-68b20e40b442","block_type":"box","text":"Zero coupon securities are securities that are sold at a discount to par value","page_number":437,"box":{"x":310,"y":862,"width":575,"height":12}},{"id":"fde6e2e5-69e9-4b5f-b233-f79069055eeb","block_type":"box","text":"and do not pay interest during the life of the security. The discount approximates the total amount of","page_number":437,"box":{"x":116,"y":878,"width":747,"height":12}},{"id":"a70706b3-fba4-40e3-acc5-c6ccae08a3db","block_type":"box","text":"II-105","page_number":437,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"bd05281b-beb6-4ee5-ad64-70a79002d389","block_type":"box","text":"NM1026U-6004382-437/605","page_number":437,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"83b4811f-5550-46d1-b8f6-eaea4aa1e4e8","block_type":"box","text":"interest the security will accrue and compound over the period until maturity at a rate of interest","page_number":438,"box":{"x":117,"y":87,"width":711,"height":12}},{"id":"7626c80d-d8d9-414f-becf-680161368e99","block_type":"box","text":"reflecting the market rate of the security at the time of issuance. Upon maturity, the holder of a zero","page_number":438,"box":{"x":117,"y":102,"width":741,"height":13}},{"id":"0d92831d-c006-48d3-9317-5862ede23762","block_type":"box","text":"coupon security is entitled to receive the par value of the security.","page_number":438,"box":{"x":116,"y":118,"width":492,"height":12}},{"id":"e255940b-b5e5-4fc7-8237-90b3302a81f5","block_type":"box","text":"While interest payments are not made on such securities, holders of such securities are deemed to","page_number":438,"box":{"x":116,"y":149,"width":740,"height":12}},{"id":"a9c14138-cc18-43bf-81ee-90dba9971a5d","block_type":"box","text":"have received income (“phantom income”) annually, notwithstanding that cash may not be received","page_number":438,"box":{"x":117,"y":165,"width":742,"height":12}},{"id":"40c9fead-4d73-4e48-9263-cc7a60c54463","block_type":"box","text":"currently. The effect of owning instruments that do not make current interest payments is that a fixed","page_number":438,"box":{"x":116,"y":180,"width":751,"height":12}},{"id":"0288e9ef-c91c-4247-a2cb-af93ff03f925","block_type":"box","text":"yield is earned not only on the original investment but also, in effect, on all discount accretion during","page_number":438,"box":{"x":116,"y":196,"width":746,"height":12}},{"id":"b46e05ba-e3c1-4919-a5ae-ce1d3f6e2896","block_type":"box","text":"the life of the obligations. This implicit reinvestment of earnings at a fixed rate eliminates the risk of","page_number":438,"box":{"x":116,"y":211,"width":737,"height":12}},{"id":"be4f7b3b-0414-4130-b83b-05198714d4d2","block_type":"box","text":"being unable to invest distributions at a rate as high as the implicit yield on the zero coupon bond, but","page_number":438,"box":{"x":117,"y":227,"width":757,"height":12}},{"id":"5654185d-b690-4bd1-9f8a-717b2c513d8f","block_type":"box","text":"at the same time eliminates the holder’s ability to reinvest at higher rates in the future. For this reason,","page_number":438,"box":{"x":116,"y":242,"width":764,"height":12}},{"id":"e4b422d2-50a4-47f8-8171-0096655577de","block_type":"box","text":"some of these securities may be subject to substantially greater price fluctuations during periods of","page_number":438,"box":{"x":116,"y":258,"width":739,"height":12}},{"id":"fbfb450e-2046-454e-8ed4-c7a118f91746","block_type":"box","text":"changing market interest rates than are comparable securities that pay interest currently. Longer term","page_number":438,"box":{"x":116,"y":273,"width":760,"height":12}},{"id":"15ff8c07-baef-4bdb-a626-4030188f07a8","block_type":"box","text":"zero coupon bonds are more exposed to interest rate risk than shorter term zero coupon bonds. These","page_number":438,"box":{"x":116,"y":289,"width":768,"height":12}},{"id":"83cf32c6-29c4-4ff7-9111-fbd72c466e8a","block_type":"box","text":"investments benefit the issuer by mitigating its need for cash to meet debt service, but also require a","page_number":438,"box":{"x":117,"y":304,"width":749,"height":12}},{"id":"ab8fe72a-4e6d-448c-828c-126cf9a453ed","block_type":"box","text":"higher rate of return to attract investors who are willing to defer receipt of cash.","page_number":438,"box":{"x":117,"y":320,"width":589,"height":12}},{"id":"29d8a8f0-c22d-4820-bd19-7ba83b619794","block_type":"box","text":"A Fund accrues income with respect to these securities for U.S. federal income tax and accounting","page_number":438,"box":{"x":116,"y":351,"width":739,"height":12}},{"id":"ff9a2763-dd32-44de-987e-13d254b16420","block_type":"box","text":"purposes prior to the receipt of cash payments. Zero coupon securities may be subject to greater","page_number":438,"box":{"x":117,"y":366,"width":724,"height":12}},{"id":"c8352166-45e7-44c9-b0de-779e3359b2e0","block_type":"box","text":"fluctuation in value and less liquidity in the event of adverse market conditions than comparably rated","page_number":438,"box":{"x":116,"y":382,"width":756,"height":12}},{"id":"b2b06f87-2dc7-444e-a1c3-b544769ca61b","block_type":"box","text":"securities that pay cash interest at regular intervals.","page_number":438,"box":{"x":116,"y":397,"width":388,"height":12}},{"id":"7de1cb89-73b8-48f0-b5ef-53612812dc86","block_type":"box","text":"Further, to maintain its qualification for pass-through treatment under the U.S. federal tax laws, a Fund","page_number":438,"box":{"x":117,"y":428,"width":764,"height":12}},{"id":"8ad3294b-e3f7-47f3-9015-3be3ab90ea69","block_type":"box","text":"is required to distribute income to its shareholders and, consequently, may have to dispose of other,","page_number":438,"box":{"x":117,"y":444,"width":746,"height":12}},{"id":"d2efdf34-8c02-4194-93e9-b9077b27c316","block_type":"box","text":"more liquid portfolio securities under disadvantageous circumstances or may have to leverage itself by","page_number":438,"box":{"x":117,"y":459,"width":765,"height":12}},{"id":"8066f856-72f8-4f3c-b265-44c55c860121","block_type":"box","text":"borrowing in order to generate the cash to satisfy these distributions. The required distributions may","page_number":438,"box":{"x":117,"y":475,"width":744,"height":12}},{"id":"8dbd4b07-3f21-4d55-962e-2d581a708649","block_type":"box","text":"result in an increase in a Fund’s exposure to zero coupon securities.","page_number":438,"box":{"x":117,"y":490,"width":511,"height":12}},{"id":"f4859fd9-aae0-48c6-9eff-94d3bea19ba1","block_type":"box","text":"In addition to the above-described risks, there are certain other risks related to investing in zero","page_number":438,"box":{"x":117,"y":521,"width":712,"height":12}},{"id":"21618b01-8834-4474-a219-adb94049126b","block_type":"box","text":"coupon securities. During a period of severe market conditions, the market for such securities may","page_number":438,"box":{"x":116,"y":537,"width":736,"height":12}},{"id":"58773ae7-754d-47fd-a85c-0d37ca5ea032","block_type":"box","text":"become even less liquid. In addition, as these securities do not pay cash interest, a Fund’s investment","page_number":438,"box":{"x":117,"y":552,"width":762,"height":12}},{"id":"609dadd1-66e8-49f1-b348-78ba0f6b43a9","block_type":"box","text":"exposure to these securities and their risks, including credit risk, will increase during the time these","page_number":438,"box":{"x":116,"y":568,"width":739,"height":12}},{"id":"b41a8ebd-150f-4371-b617-5665f16033db","block_type":"box","text":"securities are held in the Fund’s portfolio.","page_number":438,"box":{"x":116,"y":583,"width":311,"height":12}},{"id":"e44cbca0-fcc7-47f2-95d0-7868e378d764","block_type":"box","text":"Suitability. (All Funds)","page_number":438,"box":{"x":117,"y":614,"width":181,"height":12}},{"id":"75857d6c-d45d-4112-a404-7cffa39d92e3","block_type":"box","text":"The economic benefit of an investment in any Fund depends upon many factors beyond the control of","page_number":438,"box":{"x":116,"y":637,"width":760,"height":12}},{"id":"61ab259e-254e-42e4-912a-43226bb8dd0c","block_type":"box","text":"the Fund, the Manager and its affiliates. Each Fund should be considered a vehicle for diversification","page_number":438,"box":{"x":116,"y":653,"width":753,"height":12}},{"id":"fce4758c-6cfa-45d7-bd34-fea4aa42358f","block_type":"box","text":"and not as a balanced investment program. The suitability for any particular investor of a purchase of","page_number":438,"box":{"x":116,"y":668,"width":751,"height":12}},{"id":"c6a0e65d-4208-4373-9302-12444e1e9c94","block_type":"box","text":"shares in a Fund will depend upon, among other things, such investor’s investment objectives and","page_number":438,"box":{"x":116,"y":684,"width":727,"height":12}},{"id":"48fc8a29-6191-4143-a78f-5ff6a8e430e0","block_type":"box","text":"such investor’s ability to accept the risks associated with investing in securities, including the risk of","page_number":438,"box":{"x":116,"y":699,"width":737,"height":13}},{"id":"d7fdf11a-ac8f-4dc0-bc35-72de637b2cca","block_type":"box","text":"loss of principal.","page_number":438,"box":{"x":117,"y":715,"width":118,"height":12}},{"id":"a8b2f00d-ad56-4f2e-a680-5f3d4d85bc9f","block_type":"box","text":"Investment Restrictions. (All Funds)","page_number":438,"box":{"x":116,"y":746,"width":287,"height":12}},{"id":"16efbe14-13bc-4549-8ceb-2e7c6984d555","block_type":"box","text":"See “Investment Restrictions” or “Investment Policies,” as applicable in each Fund’s SAI for the","page_number":438,"box":{"x":116,"y":769,"width":707,"height":12}},{"id":"91288de1-5b29-455c-9f54-ffa7ac9710b3","block_type":"box","text":"specific fundamental and non-fundamental investment restrictions adopted by each Fund. In addition to","page_number":438,"box":{"x":116,"y":785,"width":766,"height":12}},{"id":"0d95e58a-fdf1-4329-96b2-ffd56bc0d4d7","block_type":"box","text":"those investment restrictions, each Fund is also subject to the restrictions discussed below.","page_number":438,"box":{"x":116,"y":800,"width":677,"height":12}},{"id":"110a8617-2fc8-49d3-863a-90d26279a2dc","block_type":"box","text":"Each Fund’s investments will be limited in order to","page_number":438,"box":{"x":117,"y":831,"width":376,"height":10}},{"id":"fa5c2bfc-fe8e-4aa6-9c91-ecf35d323383","block_type":"box","text":"allow the Fund to qualify as a “regulated investment","page_number":438,"box":{"x":494,"y":831,"width":389,"height":12}},{"id":"ad73502d-e116-4059-b44b-09f12f96c552","block_type":"box","text":"company” for purposes of the Code. See “Dividends and Taxes — Taxes” or “Taxes.” To qualify,","page_number":438,"box":{"x":116,"y":847,"width":721,"height":12}},{"id":"72445fe9-9cc5-4655-ad49-92d89f38b2f2","block_type":"box","text":"among other requirements, each Fund will limit its investments so that, at the close of each quarter of","page_number":438,"box":{"x":116,"y":862,"width":757,"height":12}},{"id":"539fe1a7-1dce-4938-8c1a-a5dec0c0a8fb","block_type":"box","text":"the taxable year, (i) at least 50% of the market value of each Fund’s assets is represented by cash,","page_number":438,"box":{"x":116,"y":878,"width":741,"height":12}},{"id":"bdd099e0-4dc2-4311-a42c-5b6a7a2a391c","block_type":"box","text":"II-106","page_number":438,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"05fa9ef9-1ec6-445c-a22d-b1e5db607e74","block_type":"box","text":"NM1026U-6004382-438/605","page_number":438,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5de81cdd-d60c-4c2f-a919-1d8768bf68ec","block_type":"box","text":"securities of other regulated investment companies, U.S. Government Securities and other securities,","page_number":439,"box":{"x":116,"y":87,"width":759,"height":12}},{"id":"830f98f2-8795-43c1-977b-02b25860a094","block_type":"box","text":"with such other securities limited, in respect of any one issuer, to an amount not greater in value than","page_number":439,"box":{"x":116,"y":102,"width":756,"height":13}},{"id":"b010779e-d03e-4b6c-9765-aac3d0d37b07","block_type":"box","text":"5% of the Fund’s assets and not greater than 10% of the outstanding voting securities of such issuer","page_number":439,"box":{"x":116,"y":118,"width":751,"height":12}},{"id":"8e8b4747-25ba-4678-afa0-c0d398075902","block_type":"box","text":"and (ii) not more than 25% of the value of its assets is invested in the securities (other than U.S.","page_number":439,"box":{"x":116,"y":134,"width":718,"height":12}},{"id":"6a0166d7-624b-4b60-bb04-812ce6fd7919","block_type":"box","text":"Government Securities or securities of other regulated investment companies) of any one issuer, any","page_number":439,"box":{"x":117,"y":149,"width":754,"height":12}},{"id":"ccbdbd10-5cbd-4ede-94c2-30f2376eed1e","block_type":"box","text":"two or more issuers that the Fund controls and that are determined to be engaged in the same or","page_number":439,"box":{"x":116,"y":165,"width":726,"height":12}},{"id":"9d2237b3-26c0-4545-af55-2003528e058a","block_type":"box","text":"similar trades or businesses or related trades or businesses or in the securities of one or more qualified","page_number":439,"box":{"x":116,"y":180,"width":772,"height":12}},{"id":"0a59c3fa-6c6b-41ee-a298-4f23b621dc06","block_type":"box","text":"publicly traded partnerships (","page_number":439,"box":{"x":117,"y":196,"width":214,"height":12}},{"id":"6b12ab99-9261-46f6-a3be-8f9fa40844da","block_type":"box","text":"i.e.","page_number":439,"box":{"x":332,"y":196,"width":21,"height":9}},{"id":"34dc0321-a355-42a8-a58d-a1f8c310755a","block_type":"box","text":", partnerships that are traded on an established securities market or","page_number":439,"box":{"x":356,"y":196,"width":507,"height":11}},{"id":"cb920f16-f784-4b46-b4bf-37127e2ca6c7","block_type":"box","text":"tradable on a secondary market, other than partnerships that derive 90% of their income from interest,","page_number":439,"box":{"x":116,"y":211,"width":764,"height":12}},{"id":"f396cd94-1a44-4e8b-ac3e-48967f32e99d","block_type":"box","text":"dividends, capital gains and other traditionally permitted mutual fund income). For purposes of this","page_number":439,"box":{"x":116,"y":227,"width":734,"height":12}},{"id":"480487a4-d89a-4d99-8e4f-76a85fb1d2b7","block_type":"box","text":"restriction, the Municipal Funds generally will regard each state and each of its political subdivisions,","page_number":439,"box":{"x":117,"y":242,"width":749,"height":12}},{"id":"489ffc5a-f070-4152-81c7-6db9038e1c03","block_type":"box","text":"agencies or instrumentalities and each multi-state agency of which the state is a member as a","page_number":439,"box":{"x":116,"y":258,"width":703,"height":12}},{"id":"bea4eb5f-333d-4755-87f8-d7ee501873b9","block_type":"box","text":"separate issuer. Each public authority that issues securities on behalf of a private entity generally will","page_number":439,"box":{"x":116,"y":273,"width":754,"height":12}},{"id":"58f394e5-53a1-4981-aca1-dd9ced8ae4ab","block_type":"box","text":"also be regarded as a separate issuer, except that if the security is backed only by the assets and","page_number":439,"box":{"x":116,"y":289,"width":731,"height":12}},{"id":"9a9b874d-1a5b-47be-9f1c-beb642b659ad","block_type":"box","text":"revenues of a non-government entity, then the entity with the ultimate responsibility for the payment of","page_number":439,"box":{"x":117,"y":304,"width":762,"height":12}},{"id":"0cb05b8d-c918-4dec-af15-2f6d59fff398","block_type":"box","text":"interest and principal may be regarded as the sole issuer.","page_number":439,"box":{"x":117,"y":320,"width":431,"height":12}},{"id":"5a190f12-6cd1-42d6-afce-011de91409e9","block_type":"box","text":"Foreign government securities (unlike U.S. Government Securities) are not exempt from the 5%, 10%","page_number":439,"box":{"x":117,"y":351,"width":759,"height":12}},{"id":"dff787d6-fa0a-4f25-ad3b-b738caec1777","block_type":"box","text":"and 25% diversification requirements of the Code discussed above, and the securities of each foreign","page_number":439,"box":{"x":116,"y":366,"width":759,"height":12}},{"id":"db3354eb-e88e-411b-ad74-787cddf9309e","block_type":"box","text":"government issuer are considered to be obligations of a single issuer. These tax-related limitations","page_number":439,"box":{"x":116,"y":382,"width":737,"height":12}},{"id":"df92298b-a4f3-41e3-8be6-ce00a47b52ee","block_type":"box","text":"may be changed by the Directors of a Fund to the extent necessary to comply with changes to the U.S.","page_number":439,"box":{"x":117,"y":397,"width":769,"height":12}},{"id":"4ae644a0-b732-4f6d-854b-5121c1968cde","block_type":"box","text":"federal tax requirements. A Fund that is “diversified” under the Investment Company Act must satisfy","page_number":439,"box":{"x":116,"y":413,"width":753,"height":12}},{"id":"6d4dce51-51a4-4ef4-8d6b-7f7cd0c7db51","block_type":"box","text":"the foregoing 5% and 10% requirements with respect to 75% of its total assets.","page_number":439,"box":{"x":116,"y":428,"width":592,"height":12}},{"id":"3bc3d8ef-7930-4a8b-a0ba-3a5beb10e9af","block_type":"box","text":"II-107","page_number":439,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"628d5d02-1bf2-402c-8a90-f8a1ffdc1eb1","block_type":"box","text":"NM1026U-6004382-439/605","page_number":439,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f23eb8e6-1c80-4502-a4da-09fa160525bd","block_type":"box","text":"Appendix A","page_number":440,"box":{"x":453,"y":87,"width":98,"height":12}},{"id":"f99374eb-fd24-4099-90f5-f19104ea3d8c","block_type":"box","text":"Description of Bond Ratings","page_number":440,"box":{"x":387,"y":117,"width":231,"height":12}},{"id":"932fc699-8f06-4db6-88b2-fdca4b759752","block_type":"box","text":"A rating is generally assigned to a fixed-income security at the time of issuance by a credit rating","page_number":440,"box":{"x":116,"y":154,"width":722,"height":12}},{"id":"dced2ab1-6c7d-495f-8a93-f1e34d3d7868","block_type":"box","text":"agency designated as a nationally recognized statistical rating organization (“NRSRO”) by the SEC.","page_number":440,"box":{"x":116,"y":170,"width":744,"height":12}},{"id":"54d69f3b-474a-478e-9cfa-9dae5bf13304","block_type":"box","text":"While NRSROs may from time to time revise such ratings, they undertake no obligation to do so, and","page_number":440,"box":{"x":116,"y":185,"width":755,"height":12}},{"id":"d796feeb-0a90-469f-aa9c-323b505f85d9","block_type":"box","text":"the ratings given to securities at issuance do not necessarily represent ratings which would be given to","page_number":440,"box":{"x":116,"y":201,"width":767,"height":12}},{"id":"815017e1-c18f-4667-908e-d7fd197c31ab","block_type":"box","text":"these securities on a particular subsequent date.","page_number":440,"box":{"x":116,"y":216,"width":366,"height":12}},{"id":"6c3765da-de17-4271-bfa5-9194e5bf514a","block_type":"box","text":"NRSROs may rate specific investments (e.g., bonds), issuers (e.g., corporations, governments and","page_number":440,"box":{"x":117,"y":246,"width":740,"height":12}},{"id":"fa95af03-66c3-4366-86e3-2c347b9d5156","block_type":"box","text":"financial institutions) and/or programs (e.g., commercial paper programs). However, certain types of","page_number":440,"box":{"x":116,"y":261,"width":747,"height":13}},{"id":"321a7bf3-2380-4b9a-bc2f-81afbea1b048","block_type":"box","text":"investments may not be rated by NRSROs, such as certain government/sovereign obligations, US","page_number":440,"box":{"x":117,"y":277,"width":732,"height":12}},{"id":"d8f116c1-2408-42cb-909e-633b1b681a3f","block_type":"box","text":"agency securities, commercial paper, time deposits at financial institutions, and derivative instruments","page_number":440,"box":{"x":116,"y":292,"width":761,"height":13}},{"id":"131be362-1e26-45f6-b820-0301bed0983a","block_type":"box","text":"such as credit default swaps. For these types of investments, as well as US Treasury securities (some","page_number":440,"box":{"x":116,"y":308,"width":764,"height":12}},{"id":"cbbb0564-6a68-476f-80a8-9fa2c0976463","block_type":"box","text":"of which are not rated), where a NRSRO has not rated the specific investment but has rated the","page_number":440,"box":{"x":116,"y":323,"width":716,"height":13}},{"id":"b9b767ac-4e8d-49b4-aafb-e72c43db10eb","block_type":"box","text":"investment’s issuer, program, financial institution or underlying reference asset, BlackRock Advisors,","page_number":440,"box":{"x":117,"y":339,"width":751,"height":12}},{"id":"84943ed1-9e07-4c0f-be12-0ada4553362e","block_type":"box","text":"LLC, BlackRock Fund Advisors or their respective affiliates (“BlackRock”) may consider the investment","page_number":440,"box":{"x":117,"y":355,"width":766,"height":12}},{"id":"6be75269-a945-4642-a115-cea4eb74e07f","block_type":"box","text":"to have the same NRSRO rating as its issuer, program, financial institution or underlying reference","page_number":440,"box":{"x":116,"y":370,"width":736,"height":12}},{"id":"4a352895-92ed-4116-a58f-6be9f71f18d8","block_type":"box","text":"asset, as applicable. In the case of municipal securities, where one NRSRO provides multiple ratings","page_number":440,"box":{"x":116,"y":386,"width":754,"height":12}},{"id":"f7a8dc9b-6cd4-4bc8-a61b-66f1122c91f6","block_type":"box","text":"for the same security (e.g., “underlying,” “insured” and/or “enhanced” ratings), BlackRock may consider","page_number":440,"box":{"x":116,"y":401,"width":770,"height":12}},{"id":"521289d3-9c68-419f-9834-503900b5e544","block_type":"box","text":"the security to have the highest of the multiple ratings.","page_number":440,"box":{"x":116,"y":417,"width":407,"height":12}},{"id":"e7955c84-97f8-46f1-a124-3f0a64f8eed0","block_type":"box","text":"New issue securities (regardless of type) may not be rated by a NRSRO at the time of their initial","page_number":440,"box":{"x":117,"y":446,"width":722,"height":13}},{"id":"dcf6f381-e7ca-4a4b-8518-c7dfbc4a2a7e","block_type":"box","text":"offering. Preliminary prospectuses or term sheets for new issue securities may include an expected","page_number":440,"box":{"x":116,"y":462,"width":742,"height":12}},{"id":"2e97ac1e-92e7-406d-a7a7-4867ecc2b90e","block_type":"box","text":"rating for the security (as determined by the underwriter and/or issuer) or a NRSRO rating for the","page_number":440,"box":{"x":117,"y":477,"width":723,"height":13}},{"id":"8849cd3e-f125-4f3c-afec-984840b648d8","block_type":"box","text":"issuer of the security. If applicable, when deciding whether to purchase a new issue security that has","page_number":440,"box":{"x":117,"y":493,"width":752,"height":12}},{"id":"6cb8507e-5e69-465b-b6ce-302cb318fca1","block_type":"box","text":"not yet been rated by a NRSRO, BlackRock may attribute an expected rating to the security based on:","page_number":440,"box":{"x":117,"y":508,"width":763,"height":13}},{"id":"14c324a4-60c1-41fb-9751-d88e52fd4695","block_type":"box","text":"(i) the expected rating of the security set forth in the preliminary prospectus or term sheet for the","page_number":440,"box":{"x":117,"y":524,"width":718,"height":12}},{"id":"d82985d0-b681-49d9-8cd4-5bf30e146296","block_type":"box","text":"security; (ii) the NRSRO’s rating for the issuer of the security set forth in the preliminary prospectus or","page_number":440,"box":{"x":116,"y":539,"width":760,"height":13}},{"id":"f1b515df-89b9-4013-8a0d-95329fd799aa","block_type":"box","text":"term sheet for the security; or (iii) with respect to asset-backed securities, the rating of a prior issuance","page_number":440,"box":{"x":116,"y":555,"width":767,"height":12}},{"id":"8d6c6b4d-5009-4818-bcb0-f245c9882809","block_type":"box","text":"having a similar structure or the same sponsor.","page_number":440,"box":{"x":117,"y":571,"width":353,"height":12}},{"id":"9c43954c-600b-41ce-ac95-4cae13bdb82f","block_type":"box","text":"Where the investment objective of a fund is to track the performance of an index that includes credit","page_number":440,"box":{"x":116,"y":600,"width":746,"height":12}},{"id":"81d2d312-78d7-4848-af0a-873fd5abedb0","block_type":"box","text":"ratings eligibility criteria as part of its index methodology, the fund may purchase any security within the","page_number":440,"box":{"x":117,"y":616,"width":771,"height":12}},{"id":"889c08f0-2355-4d69-ac85-a162a275a0fb","block_type":"box","text":"index, such security having been determined by the index provider as meeting its credit ratings","page_number":440,"box":{"x":117,"y":632,"width":707,"height":11}},{"id":"ae90b832-fc57-4cac-ba3b-cf63696dcb39","block_type":"box","text":"eligibility criteria. The credit ratings practices of an index provider may differ from BlackRock’s","page_number":440,"box":{"x":116,"y":647,"width":701,"height":12}},{"id":"ed9fcdc7-ac7e-418b-8579-837d86fc42da","block_type":"box","text":"practices, as described above. Further, the fund may invest, directly or indirectly, in securities that are","page_number":440,"box":{"x":117,"y":662,"width":754,"height":12}},{"id":"f0de719b-14c7-462a-a756-127fcb5d64e1","block_type":"box","text":"not rated by a rating agency or securities with a credit rating that differs from the credit rating specified","page_number":440,"box":{"x":117,"y":678,"width":757,"height":12}},{"id":"18f3fd46-5d42-4655-83a3-93d1c042174c","block_type":"box","text":"in its index methodology in various circumstances, including where a security is downgraded but not","page_number":440,"box":{"x":117,"y":694,"width":741,"height":11}},{"id":"7ef2d56f-e365-48d6-a721-cc6673fd08ee","block_type":"box","text":"yet removed from an index, following the removal of a security from an index prior to its sale by the","page_number":440,"box":{"x":116,"y":709,"width":733,"height":12}},{"id":"dee9f89c-f6ea-4caa-8e0e-2024925112d7","block_type":"box","text":"fund or as a result of a corporate action or restructuring affecting an issuer of a security held by the","page_number":440,"box":{"x":116,"y":724,"width":734,"height":13}},{"id":"0def13a9-54cd-4316-9888-4c943e927a70","block_type":"box","text":"fund.","page_number":440,"box":{"x":116,"y":740,"width":36,"height":9}},{"id":"c1f6a5fc-99c8-48ad-afb6-93bc009a3c24","block_type":"box","text":"Fixed-income securities which are unrated may expose the investor to risks with respect to capacity to","page_number":440,"box":{"x":117,"y":770,"width":757,"height":12}},{"id":"0538de55-bb5f-4ec4-9606-39425f3fcca8","block_type":"box","text":"pay interest or repay principal which are similar to the risks of lower-rated speculative bonds.","page_number":440,"box":{"x":117,"y":785,"width":686,"height":12}},{"id":"1dcfedc2-9b3e-4d22-be15-f25160955b86","block_type":"box","text":"Evaluation of these securities is dependent on BlackRock’s judgment, analysis and experience in the","page_number":440,"box":{"x":117,"y":801,"width":747,"height":12}},{"id":"7ae90821-adc1-45ee-a269-6ae30db99b6c","block_type":"box","text":"evaluation of such securities.","page_number":440,"box":{"x":116,"y":816,"width":214,"height":10}},{"id":"d5a23202-2402-42e0-947e-63e60e3ec630","block_type":"box","text":"Investors should note that the assignment of a rating to a security by an NRSRO may not reflect the","page_number":440,"box":{"x":117,"y":846,"width":745,"height":12}},{"id":"bd0ee5fd-3a52-4278-b049-1e732689b41f","block_type":"box","text":"effect of recent developments on the issuer’s ability to make interest and principal payments or on the","page_number":440,"box":{"x":116,"y":862,"width":760,"height":12}},{"id":"f74d3d1c-51f8-47d0-9c46-96f0485ebed4","block_type":"box","text":"likelihood of default.","page_number":440,"box":{"x":117,"y":877,"width":152,"height":10}},{"id":"b11eff8d-9f58-4ec3-936b-248cb95b3f46","block_type":"box","text":"A-1","page_number":440,"box":{"x":486,"y":909,"width":24,"height":9}},{"id":"d3df76dd-b103-48a9-a95b-c992109d469b","block_type":"box","text":"NM1026U-6004382-440/605","page_number":440,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6a29335a-fb95-4097-9a5f-eee4190b94b2","block_type":"box","text":"Securities deemed to be high yield are rated below Baa3 by Moody’s and below BBB- by S&P Global","page_number":441,"box":{"x":116,"y":87,"width":755,"height":12}},{"id":"56edf6a4-e7b3-4723-86e2-db5e2162cf29","block_type":"box","text":"Ratings and Fitch.","page_number":441,"box":{"x":117,"y":103,"width":139,"height":12}},{"id":"251d14e1-340a-4734-8659-323ec06f5101","block_type":"box","text":"The descriptions below relate to general long-term and short-term obligations of an issuer.","page_number":441,"box":{"x":116,"y":134,"width":674,"height":12}},{"id":"dcdfb9dc-575d-4cc1-b382-fc77d7ebf159","block_type":"box","text":"A Description of Moody’s Investors Service, Inc.’s (“Moody’s”) Global Rating Scales","page_number":441,"box":{"x":116,"y":165,"width":677,"height":12}},{"id":"087d4a69-d9fc-4d19-ae9e-49cb8996c483","block_type":"box","text":"Ratings assigned on Moody’s global long-term and short-term rating scales are forward-looking","page_number":441,"box":{"x":117,"y":196,"width":711,"height":12}},{"id":"40b48d16-d00b-46c9-af09-31bb6ec16f82","block_type":"box","text":"opinions of the relative credit risks of financial obligations issued by non-financial corporates, financial","page_number":441,"box":{"x":116,"y":211,"width":759,"height":12}},{"id":"ff68b9b0-d701-4ea2-92bf-8840eb19c7aa","block_type":"box","text":"institutions, structured finance vehicles, project finance vehicles, and public sector entities. Moody’s","page_number":441,"box":{"x":117,"y":227,"width":742,"height":12}},{"id":"7b521c31-cedd-4f94-98c3-71a3527c4133","block_type":"box","text":"defines credit risk as the risk that an entity may not meet its contractual financial obligations as they","page_number":441,"box":{"x":116,"y":242,"width":744,"height":12}},{"id":"1a449cb5-ba5b-46ee-85de-4d9234e46ffc","block_type":"box","text":"come due and any estimated financial loss in the event of default or impairment. The contractual","page_number":441,"box":{"x":116,"y":258,"width":720,"height":12}},{"id":"19d17312-932d-44e0-b549-7c4db95246c1","block_type":"box","text":"financial obligations addressed by Moody’s ratings are those that call for, without regard to","page_number":441,"box":{"x":116,"y":273,"width":676,"height":12}},{"id":"c62c8bf4-895e-4569-98a7-cc055f2e55cf","block_type":"box","text":"enforceability, the payment of an ascertainable amount, which may vary based upon standard sources","page_number":441,"box":{"x":116,"y":289,"width":765,"height":12}},{"id":"1cc8916f-41bb-472e-a0cd-678d0e97b0dd","block_type":"box","text":"of variation (e.g., floating interest rates), by an ascertainable date. Moody’s rating addresses the","page_number":441,"box":{"x":116,"y":304,"width":719,"height":12}},{"id":"9aa3110d-2aba-4a9f-b370-0e4aae403277","block_type":"box","text":"issuer’s ability to obtain cash sufficient to service the obligation, and its willingness to pay. Moody’s","page_number":441,"box":{"x":117,"y":320,"width":738,"height":12}},{"id":"a2de84a6-a406-4900-a2fa-c74183494b26","block_type":"box","text":"ratings do not address non-standard sources of variation in the amount of the principal obligation (e.g.,","page_number":441,"box":{"x":117,"y":335,"width":765,"height":12}},{"id":"db8960c8-c402-46da-a0d4-97f3252c9e8c","block_type":"box","text":"equity indexed), absent an express statement to the contrary in a press release accompanying an","page_number":441,"box":{"x":116,"y":351,"width":731,"height":12}},{"id":"7f9f9bd0-5eaa-4314-8a5f-36953980ca67","block_type":"box","text":"initial rating. Long-term ratings are assigned to issuers or obligations with an original maturity of one","page_number":441,"box":{"x":117,"y":366,"width":745,"height":12}},{"id":"28afb07e-c242-4a81-a8ee-1cf5c119fc48","block_type":"box","text":"year or more and reflect both on the likelihood of a default or impairment on contractual financial","page_number":441,"box":{"x":116,"y":382,"width":719,"height":12}},{"id":"b88adee7-79e3-408b-8217-7fa8fe0d3b28","block_type":"box","text":"obligations and the expected financial loss suffered in the event of default or impairment. Short-term","page_number":441,"box":{"x":116,"y":397,"width":747,"height":12}},{"id":"7de1f06e-ef3b-4dbe-98f4-2e45395c65c4","block_type":"box","text":"ratings are assigned for obligations with an original maturity of thirteen months or less and reflect both","page_number":441,"box":{"x":117,"y":413,"width":760,"height":12}},{"id":"1d2a3afd-3fb0-42b6-bc7c-017bfbb19deb","block_type":"box","text":"on the likelihood of a default or impairment on contractual financial obligations and the expected","page_number":441,"box":{"x":116,"y":428,"width":717,"height":12}},{"id":"861ee8e5-3036-4ab9-8b2f-d39db1849919","block_type":"box","text":"financial loss suffered in the event of default or impairment. Moody’s issues ratings at the issuer level","page_number":441,"box":{"x":116,"y":444,"width":755,"height":12}},{"id":"ee293a87-9fdb-478c-b2be-316cbc62959d","block_type":"box","text":"and instrument level on both the long-term scale and the short-term scale. Typically, ratings are made","page_number":441,"box":{"x":116,"y":459,"width":761,"height":12}},{"id":"730b1a7b-2ba4-40d6-b42d-4a054f37a6b2","block_type":"box","text":"publicly available although private and unpublished ratings may also be assigned.","page_number":441,"box":{"x":117,"y":475,"width":610,"height":12}},{"id":"309060af-8b62-48b0-9914-9844487a3d57","block_type":"box","text":"Moody’s differentiates structured finance ratings from fundamental ratings (i.e., ratings on nonfinancial","page_number":441,"box":{"x":117,"y":506,"width":763,"height":12}},{"id":"ef0b4f7e-1fb7-4c28-b27f-b714cc576440","block_type":"box","text":"corporate, financial institution, and public sector entities) on the global long-term scale by adding (sf) to","page_number":441,"box":{"x":116,"y":521,"width":769,"height":12}},{"id":"e79f8880-0b8d-44e4-9232-0ab498ec20f3","block_type":"box","text":"all structured finance ratings. The addition of (sf) to structured finance ratings should eliminate any","page_number":441,"box":{"x":116,"y":537,"width":735,"height":12}},{"id":"568cf62e-3839-409d-b8d4-c4d536eb05fd","block_type":"box","text":"presumption that such ratings and fundamental ratings at the same letter grade level will behave the","page_number":441,"box":{"x":117,"y":552,"width":747,"height":12}},{"id":"8abef38f-0233-444b-911d-7c49f80503d7","block_type":"box","text":"same. The (sf) indicator for structured finance security ratings indicates that otherwise similarly rated","page_number":441,"box":{"x":116,"y":568,"width":751,"height":12}},{"id":"b6e9645e-5a41-457e-9921-00cfbbbcf58a","block_type":"box","text":"structured finance and fundamental securities may have different risk characteristics. Through its","page_number":441,"box":{"x":116,"y":583,"width":724,"height":12}},{"id":"9c9f9a57-a17e-477f-8b34-3b61a30126b7","block_type":"box","text":"current methodologies, however, Moody’s aspires to achieve broad expected equivalence in structured","page_number":441,"box":{"x":116,"y":599,"width":769,"height":12}},{"id":"470e5498-49e5-423f-bfd5-78abe741b440","block_type":"box","text":"finance and fundamental rating performance when measured over a long period of time.","page_number":441,"box":{"x":116,"y":614,"width":658,"height":12}},{"id":"2486775f-7f91-41b8-aeb6-0e2aee72a36e","block_type":"box","text":"Description of Moody’s Global Long-Term Rating Scale","page_number":441,"box":{"x":117,"y":645,"width":445,"height":12}},{"id":"4447406e-3100-4ace-8c78-a831aece0df9","block_type":"box","text":"Aaa Obligations rated Aaa are judged to be of the highest quality, subject to the lowest level","page_number":441,"box":{"x":116,"y":676,"width":756,"height":12}},{"id":"e7ce8889-345c-41f8-b1d2-202f3afad678","block_type":"box","text":"of credit risk.","page_number":441,"box":{"x":226,"y":692,"width":93,"height":9}},{"id":"4822f178-71ea-4f3e-9a1a-4364eb7dd2e5","block_type":"box","text":"Aa Obligations rated Aa are judged to be of high quality and are subject to very low credit","page_number":441,"box":{"x":116,"y":715,"width":747,"height":12}},{"id":"a8240ab6-d95f-4cab-a937-b708db4bc1c3","block_type":"box","text":"risk.","page_number":441,"box":{"x":226,"y":731,"width":28,"height":9}},{"id":"d4c112d8-65aa-4c10-ba84-e1ed413e232d","block_type":"box","text":"A Obligations rated A are judged to be upper-medium grade and are subject to low credit","page_number":441,"box":{"x":116,"y":754,"width":754,"height":12}},{"id":"622d6e54-b3fc-43cb-851c-309e96c7fcc2","block_type":"box","text":"risk.","page_number":441,"box":{"x":226,"y":769,"width":28,"height":10}},{"id":"7516bd75-5872-43a2-9305-56c759a29b7e","block_type":"box","text":"Baa Obligations rated Baa are judged to be medium-grade and subject to moderate credit","page_number":441,"box":{"x":117,"y":792,"width":741,"height":13}},{"id":"2546936e-b3f3-4b1c-ae00-d0d7d14e5c33","block_type":"box","text":"risk and as such may possess certain speculative characteristics.","page_number":441,"box":{"x":226,"y":808,"width":483,"height":12}},{"id":"92a1b941-7e25-481a-8643-466ffe394884","block_type":"box","text":"Ba Obligations rated Ba are judged to be speculative and are subject to substantial credit","page_number":441,"box":{"x":117,"y":831,"width":750,"height":12}},{"id":"f42136bb-9450-4b76-97b2-abd10b8bc324","block_type":"box","text":"risk.","page_number":441,"box":{"x":226,"y":847,"width":35,"height":9}},{"id":"cf9d9273-3e02-47b3-9ada-d173faaa778c","block_type":"box","text":"B Obligations rated B are considered speculative and are subject to high credit risk.","page_number":441,"box":{"x":117,"y":870,"width":717,"height":12}},{"id":"85c8d198-c713-47f8-bcbf-fa2c7977ee2d","block_type":"box","text":"A-2","page_number":441,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"189ba5de-d47a-4785-b69e-0ba6e5de4b81","block_type":"box","text":"NM1026U-6004382-441/605","page_number":441,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b52157c0-0f11-459a-a9e0-767477378d9e","block_type":"box","text":"Caa Obligations rated Caa are judged to be speculative of poor standing and are subject to","page_number":442,"box":{"x":117,"y":87,"width":755,"height":12}},{"id":"608b2a31-b0f1-42db-b81b-ec8f8c9fb1a5","block_type":"box","text":"very high credit risk.","page_number":442,"box":{"x":225,"y":103,"width":154,"height":12}},{"id":"b80ebffe-995f-4062-b533-35fc9511909e","block_type":"box","text":"Ca Obligations rated Ca are highly speculative and are likely in, or very near, default, with","page_number":442,"box":{"x":117,"y":126,"width":753,"height":12}},{"id":"a66a05c4-3d3f-44b7-987c-be4035fd1bd2","block_type":"box","text":"some prospect of recovery of principal and interest.","page_number":442,"box":{"x":226,"y":141,"width":386,"height":12}},{"id":"5c55b596-a539-4f47-ac9d-487fc9203b4c","block_type":"box","text":"C Obligations rated C are the lowest rated and are typically in default, with little prospect","page_number":442,"box":{"x":117,"y":165,"width":752,"height":12}},{"id":"583ed459-61a3-436b-8251-20ccc1d34998","block_type":"box","text":"for recovery of principal or interest.","page_number":442,"box":{"x":225,"y":180,"width":264,"height":12}},{"id":"1a2c1365-71be-480b-b395-196862eceb91","block_type":"box","text":"Note:","page_number":442,"box":{"x":117,"y":210,"width":39,"height":9}},{"id":"2fe45c39-4dd1-474d-b5b3-70e0aea49ec0","block_type":"box","text":"Moody’s appends numerical modifiers 1, 2, and 3 to each generic rating classification from Aa","page_number":442,"box":{"x":156,"y":210,"width":706,"height":12}},{"id":"7d6983e0-1c28-4f5c-afbb-8fe92a35e4f9","block_type":"box","text":"through Caa. The modifier 1 indicates that the obligation ranks in the higher end of its generic rating","page_number":442,"box":{"x":116,"y":225,"width":745,"height":12}},{"id":"5bef284d-ea9d-4dff-8dd7-73770a164973","block_type":"box","text":"category; the modifier 2 indicates a mid-range ranking; and the modifier 3 indicates a ranking in the","page_number":442,"box":{"x":116,"y":241,"width":741,"height":12}},{"id":"0fb2767a-e8f8-4cdb-819e-38a8282cb98d","block_type":"box","text":"lower end of that generic rating category. Additionally, a “(hyb)” indicator is appended to all ratings of","page_number":442,"box":{"x":117,"y":256,"width":751,"height":12}},{"id":"fbf1a9a7-4bfc-4350-a3cf-765400ea1d7a","block_type":"box","text":"hybrid securities issued by banks, insurers, finance companies, and securities firms.","page_number":442,"box":{"x":117,"y":272,"width":628,"height":12}},{"id":"c99fb396-455d-4310-a416-eb197e6be353","block_type":"box","text":"By their terms, hybrid securities allow for the omission of scheduled dividends, interest, or principal","page_number":442,"box":{"x":117,"y":301,"width":737,"height":12}},{"id":"11161671-b11d-4caf-affb-a7e6400a620f","block_type":"box","text":"payments, which can potentially result in impairment if such an omission occurs. Hybrid securities may","page_number":442,"box":{"x":117,"y":317,"width":765,"height":12}},{"id":"202b4210-0151-48e8-acd8-fd1e4b5d21f0","block_type":"box","text":"also be subject to contractually allowable write-downs of principal that could result in impairment.","page_number":442,"box":{"x":116,"y":332,"width":724,"height":12}},{"id":"3df6a8cb-39b9-49b5-9aa1-0d51ff6c1fee","block_type":"box","text":"Together with the hybrid indicator, the long-term obligation rating assigned to a hybrid security is an","page_number":442,"box":{"x":116,"y":348,"width":744,"height":12}},{"id":"e562248a-3b32-482d-b9be-d8897e8408f8","block_type":"box","text":"expression of the relative credit risk associated with that security.","page_number":442,"box":{"x":116,"y":363,"width":488,"height":12}},{"id":"4757a85d-3d53-43ab-869e-0c9f43ba271a","block_type":"box","text":"Description of Moody’s Global Short-Term Rating Scale","page_number":442,"box":{"x":117,"y":393,"width":448,"height":12}},{"id":"d7bf5c95-7b58-425a-897b-003eba206ddd","block_type":"box","text":"P-1 Ratings of Prime-1 reflect a superior ability to repay short-term obligations.","page_number":442,"box":{"x":117,"y":422,"width":667,"height":13}},{"id":"e6859a0a-1882-47d9-b910-fa8636c0cb1e","block_type":"box","text":"P-2 Ratings of Prime-2 reflect a strong ability to repay short-term obligations.","page_number":442,"box":{"x":117,"y":446,"width":653,"height":12}},{"id":"a57861a4-acaf-4e62-a3b1-b2aee37d896a","block_type":"box","text":"P-3 Ratings of Prime-3 reflect an acceptable ability to repay short-term obligations.","page_number":442,"box":{"x":117,"y":469,"width":697,"height":12}},{"id":"40cce277-798a-4cf5-b65c-11cda15419d2","block_type":"box","text":"NP Issuers (or supporting institutions) rated Not Prime do not fall within any of the Prime","page_number":442,"box":{"x":117,"y":492,"width":741,"height":12}},{"id":"83729da6-777c-4dac-a670-d3c5b09f9e26","block_type":"box","text":"rating categories.","page_number":442,"box":{"x":226,"y":508,"width":133,"height":12}},{"id":"99512e36-31e1-45ce-b4f6-a0dca15b1eb8","block_type":"box","text":"Description of Moody’s U.S. Municipal Short-Term Debt and Demand Obligation Ratings","page_number":442,"box":{"x":117,"y":537,"width":707,"height":12}},{"id":"67acd371-143d-4fae-8b3d-fe99235aea6c","block_type":"box","text":"Description of Moody’s Short-Term Obligation Ratings","page_number":442,"box":{"x":117,"y":567,"width":439,"height":12}},{"id":"58718ab3-9923-42ab-b32e-aa131e155557","block_type":"box","text":"Moody’s uses the global short-term Prime rating scale for commercial paper issued by U.S.","page_number":442,"box":{"x":117,"y":596,"width":681,"height":13}},{"id":"e17ad3e8-faa0-492c-91a5-92d814e2a9f5","block_type":"box","text":"municipalities and nonprofits. These commercial paper programs may be backed by external letters of","page_number":442,"box":{"x":117,"y":612,"width":761,"height":12}},{"id":"6d833f55-9207-4d3c-9c68-3c001e5d272b","block_type":"box","text":"credit or liquidity facilities, or by an issuer’s self-liquidity.","page_number":442,"box":{"x":116,"y":627,"width":420,"height":13}},{"id":"365578f1-6292-4e4c-96fc-ae26a7689fab","block_type":"box","text":"For other short-term municipal obligations, Moody’s uses one of two other short-term rating scales, the","page_number":442,"box":{"x":117,"y":657,"width":765,"height":12}},{"id":"1dd14205-dd76-4dfe-8372-88f52c2d4b5f","block_type":"box","text":"Municipal Investment Grade (“MIG”) and Variable Municipal Investment Grade (“VMIG”) scales","page_number":442,"box":{"x":117,"y":673,"width":703,"height":12}},{"id":"28aeeb70-9af0-4529-af99-bc223ead6c74","block_type":"box","text":"discussed below.","page_number":442,"box":{"x":116,"y":688,"width":126,"height":10}},{"id":"b9d5c97f-71f4-4b1c-b652-08035ab3f974","block_type":"box","text":"Moody’s uses the MIG scale for U.S. municipal cash flow notes, bond anticipation notes and certain","page_number":442,"box":{"x":117,"y":718,"width":738,"height":12}},{"id":"14532aca-0bf1-4b1a-9239-0efbe347d811","block_type":"box","text":"other short-term obligations, which typically mature in three years or less. Under certain circumstances,","page_number":442,"box":{"x":116,"y":733,"width":766,"height":12}},{"id":"768a7a1b-ebf2-4d86-906b-98a90e08b5f8","block_type":"box","text":"Moody’s uses the MIG scale for bond anticipation notes with maturities of up to five years.","page_number":442,"box":{"x":117,"y":749,"width":665,"height":12}},{"id":"04cc0ddd-de1e-46bc-929f-687dc54922e5","block_type":"box","text":"MIG Scale","page_number":442,"box":{"x":117,"y":778,"width":77,"height":10}},{"id":"0086dfb1-c1ab-4c9b-8a97-cc21fe8fb29e","block_type":"box","text":"MIG 1 This designation denotes superior credit quality. Excellent protection is afforded by","page_number":442,"box":{"x":117,"y":808,"width":722,"height":12}},{"id":"5ee7b7f4-6ea9-489c-99a5-77daf1aa24c5","block_type":"box","text":"established cash flows, highly reliable liquidity support, or demonstrated broad-based","page_number":442,"box":{"x":226,"y":823,"width":631,"height":12}},{"id":"a7a8e07a-2ff6-4104-9ad4-cae6a85a2b34","block_type":"box","text":"access to the market for refinancing.","page_number":442,"box":{"x":226,"y":839,"width":275,"height":12}},{"id":"3c212e66-a244-4dd8-af22-5ddbfe4533d6","block_type":"box","text":"MIG 2 This designation denotes strong credit quality. Margins of protection are ample, although","page_number":442,"box":{"x":117,"y":862,"width":771,"height":12}},{"id":"7a4da039-9b0d-40da-8671-fcd1375589da","block_type":"box","text":"not as large as in the preceding group.","page_number":442,"box":{"x":226,"y":878,"width":291,"height":12}},{"id":"41700d0f-b0a1-4fb9-aef2-616bbcab4625","block_type":"box","text":"A-3","page_number":442,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"c0d2ca87-5495-45d3-b870-b6860d64b86b","block_type":"box","text":"NM1026U-6004382-442/605","page_number":442,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"261f5f89-a221-4c11-b6c3-3d4a2bc4333f","block_type":"box","text":"MIG 3 This designation denotes acceptable credit quality. Liquidity and cash-flow protection","page_number":443,"box":{"x":117,"y":87,"width":743,"height":12}},{"id":"9244ff88-ed7f-478d-86a7-8b2090543a95","block_type":"box","text":"may be narrow, and market access for refinancing is likely to be less well-established.","page_number":443,"box":{"x":226,"y":102,"width":642,"height":13}},{"id":"b6ad7af9-d26a-4d8a-9fef-f7f6ff613028","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Debt instruments in this","page_number":443,"box":{"x":116,"y":126,"width":723,"height":12}},{"id":"0731d5a8-aca1-4807-a837-365d8d1c8dd2","block_type":"box","text":"category may lack sufficient margins of protection.","page_number":443,"box":{"x":226,"y":141,"width":377,"height":12}},{"id":"019c12d7-8e0b-4b16-8f86-714881a334e1","block_type":"box","text":"Description of Moody’s Demand Obligation Ratings","page_number":443,"box":{"x":117,"y":172,"width":415,"height":12}},{"id":"fd1644a3-e099-4ff1-8120-ec001522d665","block_type":"box","text":"In the case of variable rate demand obligations (“VRDOs”), a two-component rating is assigned. The","page_number":443,"box":{"x":117,"y":203,"width":749,"height":12}},{"id":"76aafdc2-a164-4523-b19e-51a804a06a16","block_type":"box","text":"components are a long-term rating and a short-term demand obligation rating. The long-term rating","page_number":443,"box":{"x":116,"y":219,"width":740,"height":12}},{"id":"244bd7bb-a5eb-41b3-9ac7-52fdd28e1b1a","block_type":"box","text":"addresses the issuer’s ability to meet scheduled principal and interest payments. The short-term","page_number":443,"box":{"x":116,"y":234,"width":719,"height":12}},{"id":"f1acd403-9103-4df9-a110-a8bb9b20692f","block_type":"box","text":"demand obligation rating addresses the ability of the issuer or the liquidity provider to make payments","page_number":443,"box":{"x":116,"y":250,"width":759,"height":12}},{"id":"496f6566-5e95-43fc-a770-1e4fbb4d1d7d","block_type":"box","text":"associated with the purchase-price-upon-demand feature (“demand feature”) of the VRDO. The short","page_number":443,"box":{"x":116,"y":265,"width":756,"height":12}},{"id":"a30b5934-a2bb-4c6a-aa1d-e3d02227f969","block_type":"box","text":"term demand obligation rating uses the VMIG scale. VMIG ratings with liquidity support use as an input","page_number":443,"box":{"x":116,"y":281,"width":770,"height":12}},{"id":"41318db2-1b47-4051-946a-062c61b2995f","block_type":"box","text":"the short-term Counterparty Risk Assessment of the support provider, or the long-term rating of the","page_number":443,"box":{"x":116,"y":296,"width":740,"height":12}},{"id":"33ae6757-f8d7-4f9e-8dc6-6d2f5bfc8d82","block_type":"box","text":"underlying obligor in the absence of third party liquidity support. Transitions of VMIG ratings of demand","page_number":443,"box":{"x":117,"y":312,"width":768,"height":12}},{"id":"de3e3227-e171-4a2f-a509-b8c45d998164","block_type":"box","text":"obligations with conditional liquidity support differ from transitions on the Prime scale to reflect the risk","page_number":443,"box":{"x":116,"y":327,"width":760,"height":12}},{"id":"3b55a35a-d411-4406-99ea-36ae1eac6409","block_type":"box","text":"that external liquidity support will terminate if the issuer’s long-term rating drops below investment","page_number":443,"box":{"x":116,"y":343,"width":729,"height":12}},{"id":"3df19ab8-6574-4a3f-9c04-7f393edbb83a","block_type":"box","text":"grade.","page_number":443,"box":{"x":116,"y":358,"width":52,"height":12}},{"id":"a78df4fd-c141-41f5-8437-b2da07b0d176","block_type":"box","text":"Moody’s typically assigns the VMIG short-term demand obligation rating if the frequency of the demand","page_number":443,"box":{"x":117,"y":389,"width":771,"height":12}},{"id":"ba5d3c9d-3301-48d3-b5a4-93f0f8a3a523","block_type":"box","text":"feature is less than every three years. If the frequency of the demand feature is less than three years","page_number":443,"box":{"x":116,"y":405,"width":753,"height":12}},{"id":"ae0ad121-10d8-42de-ac23-435912da9d35","block_type":"box","text":"but the purchase price is payable only with remarketing proceeds, the short-term demand obligation","page_number":443,"box":{"x":117,"y":420,"width":745,"height":12}},{"id":"78dd118f-5b9b-4ffc-844c-8cd380bc4901","block_type":"box","text":"rating is “NR”.","page_number":443,"box":{"x":117,"y":436,"width":107,"height":12}},{"id":"2c507824-b4cd-4249-aea9-88ffff1ad3e5","block_type":"box","text":"VMIG Scale","page_number":443,"box":{"x":116,"y":467,"width":94,"height":9}},{"id":"73aeba9b-20e6-4e7c-878a-103ba4c80878","block_type":"box","text":"VMIG 1 This designation denotes superior credit quality. Excellent protection is afforded by the","page_number":443,"box":{"x":116,"y":498,"width":756,"height":12}},{"id":"72cb01b2-9a7c-4675-962b-01937b802f3b","block_type":"box","text":"superior short-term credit strength of the liquidity provider and structural and legal","page_number":443,"box":{"x":226,"y":513,"width":610,"height":12}},{"id":"327762ab-6a5b-47a0-9cf9-4995afeed5eb","block_type":"box","text":"protections that ensure the timely payment of purchase price upon demand.","page_number":443,"box":{"x":226,"y":529,"width":567,"height":12}},{"id":"e35de07a-23d2-41da-9aa8-f2dbe570ca8c","block_type":"box","text":"VMIG 2 This designation denotes strong credit quality. Good protection is afforded by the strong","page_number":443,"box":{"x":116,"y":552,"width":766,"height":12}},{"id":"a2de0d53-2a26-4e24-a3e7-c8ff54b9926b","block_type":"box","text":"short-term credit strength of the liquidity provider and structural and legal protections","page_number":443,"box":{"x":226,"y":568,"width":632,"height":12}},{"id":"0c807cc0-fb15-4c9d-bf29-2b796936232e","block_type":"box","text":"that ensure the timely payment of purchase price upon demand.","page_number":443,"box":{"x":225,"y":583,"width":481,"height":12}},{"id":"0b68aa45-5786-4ce1-8fc3-9a5dc2f353d3","block_type":"box","text":"VMIG 3 This designation denotes acceptable credit quality. Adequate protection is afforded by","page_number":443,"box":{"x":116,"y":606,"width":752,"height":12}},{"id":"761984d2-d886-4647-90c2-fc34646e593c","block_type":"box","text":"the satisfactory short-term credit strength of the liquidity provider and structural and","page_number":443,"box":{"x":225,"y":622,"width":624,"height":12}},{"id":"8489efa0-a5fa-456c-9906-0c778e0cd0d0","block_type":"box","text":"legal protections that ensure the timely payment of purchase price upon demand.","page_number":443,"box":{"x":226,"y":637,"width":607,"height":12}},{"id":"07e215bf-a73a-4de3-9f65-b1c6aa189e50","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Demand features rated in this","page_number":443,"box":{"x":116,"y":661,"width":762,"height":12}},{"id":"5e4dcab4-f3d2-4ce4-8d7f-0d2714fbcb2a","block_type":"box","text":"category may be supported by a liquidity provider that does not have a sufficiently","page_number":443,"box":{"x":226,"y":676,"width":606,"height":12}},{"id":"5c64ce45-7b40-42ea-a2b1-fcfdb5e85987","block_type":"box","text":"strong short-term rating or may lack the structural or legal protections necessary to","page_number":443,"box":{"x":226,"y":692,"width":614,"height":12}},{"id":"8fff1865-578e-4815-8432-f03898027ad3","block_type":"box","text":"ensure the timely payment of purchase price upon demand.","page_number":443,"box":{"x":226,"y":707,"width":441,"height":12}},{"id":"3c442ddb-e843-4579-a9e2-159d9d15b834","block_type":"box","text":"Description of S&P Global Ratings (“S&P”), a Division of S&P Global Inc., Issue Credit Ratings","page_number":443,"box":{"x":117,"y":738,"width":753,"height":12}},{"id":"1c8c1984-13db-4072-bff8-d97572f5fc61","block_type":"box","text":"An S&P issue credit rating is a forward-looking opinion about the creditworthiness of an obligor with","page_number":443,"box":{"x":116,"y":769,"width":737,"height":12}},{"id":"7907ff3f-8c2d-4bbf-9c6c-34e1dea9979e","block_type":"box","text":"respect to a specific financial obligation, a specific class of financial obligations, or a specific financial","page_number":443,"box":{"x":117,"y":785,"width":748,"height":12}},{"id":"ab322d2f-7dde-4448-bd25-de406681198e","block_type":"box","text":"program (including ratings on medium-term note programs and commercial paper programs). It takes","page_number":443,"box":{"x":117,"y":800,"width":750,"height":12}},{"id":"79b187da-bc2c-4090-933b-fd0e0c0dac24","block_type":"box","text":"into consideration the creditworthiness of guarantors, insurers, or other forms of credit enhancement","page_number":443,"box":{"x":117,"y":816,"width":744,"height":12}},{"id":"e2a3b8c1-efe2-4ebf-b06d-634178523143","block_type":"box","text":"on the obligation and takes into account the currency in which the obligation is denominated. The","page_number":443,"box":{"x":116,"y":831,"width":726,"height":12}},{"id":"2e5ba090-3d13-48a4-9832-f49ec45dcc47","block_type":"box","text":"opinion reflects S&P’s view of the obligor’s capacity and willingness to meet its financial commitments","page_number":443,"box":{"x":116,"y":847,"width":759,"height":12}},{"id":"184734ab-1218-4d81-b832-ac6f745b2c7c","block_type":"box","text":"as they come due, and this opinion may assess terms, such as collateral security and subordination,","page_number":443,"box":{"x":116,"y":862,"width":750,"height":12}},{"id":"19687743-f236-4c7b-86d3-8676afc23e44","block_type":"box","text":"which could affect ultimate payment in the event of default.","page_number":443,"box":{"x":116,"y":878,"width":441,"height":12}},{"id":"74c4f0ab-4929-43a1-9782-41e2bc590576","block_type":"box","text":"A-4","page_number":443,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"52c7b9c3-40d5-46f7-8b6a-b05a10d22159","block_type":"box","text":"NM1026U-6004382-443/605","page_number":443,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"fecf6a94-0aa0-4d91-9a22-50999c1b509d","block_type":"box","text":"Issue credit ratings can be either long-term or short-term. Short-term issue credit ratings are generally","page_number":444,"box":{"x":117,"y":87,"width":760,"height":12}},{"id":"8121b62e-21aa-4ecb-8603-4d6d6b18ad31","block_type":"box","text":"assigned to those obligations considered short-term in the relevant market, typically with an original","page_number":444,"box":{"x":116,"y":103,"width":743,"height":12}},{"id":"c01ee731-a6e5-4866-9d99-f5020a396e1f","block_type":"box","text":"maturity of no more than 365 days. Short-term issue credit ratings are also used to indicate the","page_number":444,"box":{"x":117,"y":118,"width":708,"height":12}},{"id":"916623ed-5769-4cf7-a2b2-1215725e0881","block_type":"box","text":"creditworthiness of an obligor with respect to put features on long-term obligations. S&P would typically","page_number":444,"box":{"x":116,"y":134,"width":771,"height":12}},{"id":"8e501c2a-338a-4749-95f1-86e55f7b9e94","block_type":"box","text":"assign a long-term issue credit rating to an obligation with an original maturity of greater than 365 days.","page_number":444,"box":{"x":116,"y":149,"width":772,"height":12}},{"id":"3e01e989-8976-40ab-b1a6-d336b0037c28","block_type":"box","text":"However, the ratings S&P assigns to certain instruments may diverge from these guidelines based on","page_number":444,"box":{"x":117,"y":165,"width":758,"height":12}},{"id":"392e3c3e-c6f9-4d06-93b8-e58942bca246","block_type":"box","text":"market practices. Medium-term notes are assigned long-term ratings.","page_number":444,"box":{"x":117,"y":180,"width":518,"height":12}},{"id":"525d6c5c-45b1-47d4-b09a-b6b06fee42b5","block_type":"box","text":"Issue credit ratings are based, in varying degrees, on S&P’s analysis of the following considerations:","page_number":444,"box":{"x":117,"y":208,"width":750,"height":12}},{"id":"db42811e-dc65-4ac8-9771-8898dacec961","block_type":"box","text":"• The likelihood of payment — the capacity and willingness of the obligor to meet its financial","page_number":444,"box":{"x":117,"y":237,"width":714,"height":12}},{"id":"c6b94480-a349-4a72-b9d6-6424a93806fd","block_type":"box","text":"commitments on an obligation in accordance with the terms of the obligation;","page_number":444,"box":{"x":150,"y":252,"width":575,"height":12}},{"id":"40db19b8-179c-41f2-8ddd-e8702badf5c7","block_type":"box","text":"• The nature and provisions of the financial obligation, and the promise S&P imputes; and","page_number":444,"box":{"x":117,"y":274,"width":691,"height":12}},{"id":"a2672985-c286-4077-b309-da3fb0e6decc","block_type":"box","text":"• The protection afforded by, and relative position of, the financial obligation in the event of a","page_number":444,"box":{"x":117,"y":296,"width":712,"height":12}},{"id":"35bfb5a5-3f88-4460-a452-ac4ce0142491","block_type":"box","text":"bankruptcy, reorganization, or other arrangement under the laws of bankruptcy and other laws","page_number":444,"box":{"x":150,"y":312,"width":704,"height":12}},{"id":"4c8903be-1c65-430f-b761-b64f312150d0","block_type":"box","text":"affecting creditors’ rights.","page_number":444,"box":{"x":150,"y":327,"width":191,"height":12}},{"id":"a4aead49-4d3b-49a8-8cac-243170d078d2","block_type":"box","text":"An issue rating is an assessment of default risk but may incorporate an assessment of relative seniority","page_number":444,"box":{"x":116,"y":355,"width":772,"height":13}},{"id":"d534883e-54c8-4b67-a6ae-02fbe893e460","block_type":"box","text":"or ultimate recovery in the event of default. Junior obligations are typically rated lower than senior","page_number":444,"box":{"x":116,"y":371,"width":728,"height":12}},{"id":"e78d7479-7c54-44c4-bb34-0595a7e5581e","block_type":"box","text":"obligations, to reflect lower priority in bankruptcy, as noted above. (Such differentiation may apply","page_number":444,"box":{"x":116,"y":386,"width":729,"height":13}},{"id":"2bd18ad2-2fc5-4ddb-b5f9-938c2e3e2180","block_type":"box","text":"when an entity has both senior and subordinated obligations, secured and unsecured obligations, or","page_number":444,"box":{"x":116,"y":402,"width":747,"height":12}},{"id":"971080f3-6bf4-4d15-86c0-18df4a1f2ff7","block_type":"box","text":"operating company and holding company obligations.)","page_number":444,"box":{"x":116,"y":417,"width":407,"height":13}},{"id":"19a47880-6085-454f-aea6-4919f70185b7","block_type":"box","text":"Long-Term Issue Credit Ratings*","page_number":444,"box":{"x":117,"y":446,"width":265,"height":12}},{"id":"7eb33d5b-282c-45da-aceb-c2611a5ece19","block_type":"box","text":"AAA An obligation rated ‘AAA’ has the highest rating assigned by S&P. The obligor’s capacity","page_number":444,"box":{"x":116,"y":474,"width":770,"height":12}},{"id":"efe3c898-8c14-4d6e-9dcc-f8a56855b2c3","block_type":"box","text":"to meet its financial commitments on the obligation is extremely strong.","page_number":444,"box":{"x":225,"y":490,"width":533,"height":12}},{"id":"2d558464-ba20-43f9-b38b-d3ae06fe43a9","block_type":"box","text":"AA An obligation rated ‘AA’ differs from the highest-rated obligations only to a small degree.","page_number":444,"box":{"x":116,"y":513,"width":768,"height":12}},{"id":"0e5f633c-77b1-40e1-8fb2-cc850ff68384","block_type":"box","text":"The obligor’s capacity to meet its financial commitments on the obligation is very strong.","page_number":444,"box":{"x":225,"y":528,"width":659,"height":13}},{"id":"100d734e-67bf-4e50-b4ec-d597e45d181e","block_type":"box","text":"A An obligation rated ‘A’ is somewhat more susceptible to the adverse effects of changes","page_number":444,"box":{"x":116,"y":552,"width":760,"height":12}},{"id":"df8edc6a-5c7c-4aaf-8a7e-ce49bf625714","block_type":"box","text":"in circumstances and economic conditions than obligations in higher-rated categories.","page_number":444,"box":{"x":226,"y":567,"width":642,"height":12}},{"id":"398d25f6-a116-44f5-94c6-a7abc62adf02","block_type":"box","text":"However, the obligor’s capacity to meet its financial commitments on the obligation is","page_number":444,"box":{"x":226,"y":583,"width":635,"height":12}},{"id":"dd0f7e66-31d9-4274-baa2-ba245bc443fc","block_type":"box","text":"still strong.","page_number":444,"box":{"x":226,"y":598,"width":84,"height":12}},{"id":"71ed4f66-fa39-4f36-bde3-1b413872ce56","block_type":"box","text":"BBB An obligation rated ‘BBB’ exhibits adequate protection parameters. However, adverse","page_number":444,"box":{"x":117,"y":621,"width":749,"height":13}},{"id":"83ae7b3f-1d76-44fa-9c89-a29816a65149","block_type":"box","text":"economic conditions or changing circumstances are more likely to weaken the obligor’s","page_number":444,"box":{"x":226,"y":637,"width":652,"height":12}},{"id":"be569cb5-67b4-4913-9a0c-3928201075b6","block_type":"box","text":"capacity to meet its financial commitments on the obligation.","page_number":444,"box":{"x":226,"y":652,"width":452,"height":13}},{"id":"ad5fe349-b384-4feb-ba7c-d90d5338363e","block_type":"box","text":"BB, B,","page_number":444,"box":{"x":117,"y":676,"width":45,"height":11}},{"id":"0d9d0437-4620-4aa1-b787-6c481c679932","block_type":"box","text":"CCC, CC,","page_number":444,"box":{"x":117,"y":691,"width":72,"height":11}},{"id":"72c72f6f-98ae-4575-ba73-9f3a5fb27627","block_type":"box","text":"and C","page_number":444,"box":{"x":116,"y":707,"width":44,"height":9}},{"id":"f6085bc8-ea89-438d-8daf-9cb6b38da49f","block_type":"box","text":"Obligations rated ‘BB’, ‘B’, ‘CCC’, ‘CC’, and ‘C’ are regarded as having significant","page_number":444,"box":{"x":226,"y":676,"width":602,"height":12}},{"id":"fec7014f-2f86-44fd-94d6-350ce169f753","block_type":"box","text":"speculative characteristics. ‘BB’ indicates the least degree of speculation and ‘C’ the","page_number":444,"box":{"x":226,"y":691,"width":624,"height":12}},{"id":"2f865400-5095-4b1a-afad-bd5ef1a22c4a","block_type":"box","text":"highest. While such obligations will likely have some quality and protective","page_number":444,"box":{"x":226,"y":707,"width":550,"height":12}},{"id":"3390b019-d462-4fa8-a891-826293e931ea","block_type":"box","text":"characteristics, these may be outweighed by large uncertainties or major exposure to","page_number":444,"box":{"x":226,"y":722,"width":631,"height":12}},{"id":"f203b495-0453-4fee-8155-7873761e6224","block_type":"box","text":"adverse conditions.","page_number":444,"box":{"x":226,"y":738,"width":143,"height":9}},{"id":"e266c65e-19fb-480f-a30e-a421e06d056b","block_type":"box","text":"BB An obligation rated ‘BB’ is less vulnerable to nonpayment than other speculative issues.","page_number":444,"box":{"x":117,"y":761,"width":758,"height":12}},{"id":"61b0dbdb-a8b9-4f97-a650-948389ec257e","block_type":"box","text":"However, it faces major ongoing uncertainties or exposure to adverse business,","page_number":444,"box":{"x":226,"y":776,"width":591,"height":13}},{"id":"85106912-06bf-464a-8c97-11af4881dc1c","block_type":"box","text":"financial, or economic conditions that could lead to the obligor’s inadequate capacity to","page_number":444,"box":{"x":225,"y":792,"width":644,"height":12}},{"id":"1b3a5545-06f3-4f4a-94aa-b6a8917454e4","block_type":"box","text":"meet its financial commitments on the obligation.","page_number":444,"box":{"x":226,"y":807,"width":361,"height":13}},{"id":"ea5a680f-f7a5-499d-b848-aa69e38315e3","block_type":"box","text":"B An obligation rated ‘B’ is more vulnerable to nonpayment than obligations rated ‘BB’, but","page_number":444,"box":{"x":117,"y":831,"width":767,"height":12}},{"id":"f3c96544-de23-45af-9551-f1166f70330d","block_type":"box","text":"the obligor currently has the capacity to meet its financial commitments on the","page_number":444,"box":{"x":225,"y":846,"width":584,"height":12}},{"id":"5cc9daec-fe94-4fd5-96b6-1b69e454e16a","block_type":"box","text":"obligation. Adverse business, financial, or economic conditions will likely impair the","page_number":444,"box":{"x":226,"y":862,"width":619,"height":12}},{"id":"9163abb6-27e6-49ab-8b01-e52fb924d9fe","block_type":"box","text":"obligor’s capacity or willingness to meet its financial commitments on the obligation.","page_number":444,"box":{"x":226,"y":877,"width":625,"height":12}},{"id":"197431f9-4033-47aa-b944-b594e58875a4","block_type":"box","text":"A-5","page_number":444,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"27a5e41e-fc07-40b8-acac-7c9a0f5e991e","block_type":"box","text":"NM1026U-6004382-444/605","page_number":444,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4eec883a-9a66-45af-82b6-ff82f6b92133","block_type":"box","text":"CCC An obligation rated ‘CCC’ is currently vulnerable to nonpayment and is dependent upon","page_number":445,"box":{"x":117,"y":87,"width":762,"height":12}},{"id":"79b22a62-cea5-4fa8-89f8-d5d04ae9ab4e","block_type":"box","text":"favorable business, financial, and economic conditions for the obligor to meet its","page_number":445,"box":{"x":225,"y":102,"width":601,"height":13}},{"id":"02e0bfe1-d06d-4201-a3d8-46ef8bf07765","block_type":"box","text":"financial commitments on the obligation. In the event of adverse business, financial, or","page_number":445,"box":{"x":225,"y":118,"width":647,"height":12}},{"id":"57f12ffb-ec6d-49c0-9c1c-edff74555be4","block_type":"box","text":"economic conditions, the obligor is not likely to have the capacity to meet its financial","page_number":445,"box":{"x":226,"y":134,"width":634,"height":12}},{"id":"837b3fc7-59b4-4c2a-a586-7a88e1e09ed1","block_type":"box","text":"commitments on the obligation.","page_number":445,"box":{"x":226,"y":149,"width":237,"height":12}},{"id":"929a7c8e-807e-41d1-84d4-a0d182850d1e","block_type":"box","text":"CC An obligation rated ‘CC’ is currently highly vulnerable to nonpayment. The ‘CC’ rating is","page_number":445,"box":{"x":117,"y":172,"width":761,"height":12}},{"id":"9a0cb9b5-ed62-4dfd-862d-d22126c51ea7","block_type":"box","text":"used when a default has not yet occurred but S&P expects default to be a virtual","page_number":445,"box":{"x":226,"y":188,"width":602,"height":12}},{"id":"de6ccced-8e4a-4e45-bef5-c11bfdfd39a7","block_type":"box","text":"certainty, regardless of the anticipated time to default.","page_number":445,"box":{"x":226,"y":203,"width":404,"height":12}},{"id":"3c4ed7f7-7e83-4a5e-b7dd-85cc656cab7f","block_type":"box","text":"C An obligation rated ‘C’ is currently highly vulnerable to nonpayment, and the obligation is","page_number":445,"box":{"x":117,"y":227,"width":769,"height":12}},{"id":"3dd6e245-6c27-4831-a188-a889db3868cf","block_type":"box","text":"expected to have lower relative seniority or lower ultimate recovery compared with","page_number":445,"box":{"x":226,"y":242,"width":615,"height":12}},{"id":"737a939f-c300-4b83-91f0-55f086254296","block_type":"box","text":"obligations that are rated higher.","page_number":445,"box":{"x":226,"y":258,"width":245,"height":12}},{"id":"3723d04f-8bcd-4977-ae42-6399e83fb2ca","block_type":"box","text":"D An obligation rated ‘D’ is in default or in breach of an imputed promise. For non-hybrid","page_number":445,"box":{"x":117,"y":281,"width":751,"height":12}},{"id":"36873b2c-0804-4142-b83f-464347d81521","block_type":"box","text":"capital instruments, the ‘D’ rating category is used when payments on an obligation are","page_number":445,"box":{"x":226,"y":296,"width":650,"height":12}},{"id":"ace2dee9-cd12-4232-afcb-51b0b911b0ff","block_type":"box","text":"not made on the date due, unless S&P believes that such payments will be made within","page_number":445,"box":{"x":226,"y":312,"width":655,"height":12}},{"id":"eaba6883-36b6-4358-9bd5-89c5785fac4a","block_type":"box","text":"five business days in the absence of a stated grace period or within the earlier of the","page_number":445,"box":{"x":225,"y":327,"width":632,"height":12}},{"id":"64789b7c-2e49-4afa-b247-926df11388ea","block_type":"box","text":"stated grace period or 30 calendar days. The ‘D’ rating also will be used upon the filing","page_number":445,"box":{"x":226,"y":343,"width":647,"height":12}},{"id":"9d134b05-7196-46ee-be52-5dd70f7a849e","block_type":"box","text":"of a bankruptcy petition or the taking of similar action and where default on an obligation","page_number":445,"box":{"x":226,"y":358,"width":659,"height":12}},{"id":"d9463ddc-a189-4e69-9604-5febbde01dbb","block_type":"box","text":"is a virtual certainty, for example due to automatic stay provisions. A rating on an","page_number":445,"box":{"x":226,"y":374,"width":605,"height":12}},{"id":"933d8438-f1a8-40a1-abd1-461016422dc9","block_type":"box","text":"obligation is lowered to ‘D’ if it is subject to a distressed debt restructuring.","page_number":445,"box":{"x":226,"y":389,"width":555,"height":12}},{"id":"24563862-5154-437b-a9a2-6a043915547a","block_type":"box","text":"* Ratings from ‘AA’ to ‘CCC’ may be modified by the addition of a plus (+) or minus (-) sign to show relative standing","page_number":445,"box":{"x":143,"y":420,"width":705,"height":9}},{"id":"d26dec09-e566-4775-9d6c-483b7e9fd990","block_type":"box","text":"within the rating categories.","page_number":445,"box":{"x":170,"y":433,"width":162,"height":9}},{"id":"1827a8b2-4c76-42f8-9cd7-05d99a2272b7","block_type":"box","text":"Short-Term Issue Credit Ratings","page_number":445,"box":{"x":116,"y":462,"width":263,"height":12}},{"id":"63e6a3e6-62d8-4e6c-92e3-f0b7d398cd62","block_type":"box","text":"A-1 A short-term obligation rated ‘A-1’ is rated in the highest category by S&P. The obligor’s","page_number":445,"box":{"x":116,"y":493,"width":765,"height":12}},{"id":"bdceec30-50c3-4c2f-a647-a5d87833cb64","block_type":"box","text":"capacity to meet its financial commitments on the obligation is strong. Within this","page_number":445,"box":{"x":226,"y":508,"width":603,"height":12}},{"id":"e34300ed-d882-429b-b15c-610662351678","block_type":"box","text":"category, certain obligations are designated with a plus sign (+). This indicates that the","page_number":445,"box":{"x":226,"y":524,"width":648,"height":12}},{"id":"e0a57344-f0b4-4c7c-acbd-2af30cf02e49","block_type":"box","text":"obligor’s capacity to meet its financial commitments on these obligations is extremely","page_number":445,"box":{"x":226,"y":539,"width":635,"height":12}},{"id":"84b9b99b-b460-4bf8-b197-8d287ec22a61","block_type":"box","text":"strong.","page_number":445,"box":{"x":226,"y":555,"width":55,"height":12}},{"id":"8f519aa9-4a49-40a5-92e5-4892c5a13c0a","block_type":"box","text":"A-2 A short-term obligation rated ‘A-2’ is somewhat more susceptible to the adverse effects","page_number":445,"box":{"x":116,"y":578,"width":760,"height":12}},{"id":"e9b0aa5d-6c07-4593-ba91-5b5099d2b217","block_type":"box","text":"of changes in circumstances and economic conditions than obligations in higher rating","page_number":445,"box":{"x":226,"y":593,"width":644,"height":13}},{"id":"d7feb6e9-a6b0-4490-8022-6706625c1ca8","block_type":"box","text":"categories. However, the obligor’s capacity to meet its financial commitments on the","page_number":445,"box":{"x":226,"y":609,"width":629,"height":12}},{"id":"12cc7bc8-2378-46e2-b13b-22bb0f617086","block_type":"box","text":"obligation is satisfactory.","page_number":445,"box":{"x":226,"y":624,"width":187,"height":13}},{"id":"7408892c-eab6-4c31-ba95-587a3550e960","block_type":"box","text":"A-3 A short-term obligation rated ‘A-3’ exhibits adequate protection parameters. However,","page_number":445,"box":{"x":116,"y":648,"width":750,"height":12}},{"id":"ae50511f-0fd2-44f8-9a6e-a3c82cda73a5","block_type":"box","text":"adverse economic conditions or changing circumstances are more likely to weaken an","page_number":445,"box":{"x":226,"y":663,"width":639,"height":12}},{"id":"3da05098-4ef5-4c44-8aa2-d61bca77c52a","block_type":"box","text":"obligor’s capacity to meet its financial commitments on the obligation.","page_number":445,"box":{"x":226,"y":679,"width":513,"height":12}},{"id":"5cf65684-3aa1-4e93-b3cd-de2fb3d773c3","block_type":"box","text":"B A short-term obligation rated ‘B’ is regarded as vulnerable and has significant","page_number":445,"box":{"x":117,"y":702,"width":681,"height":12}},{"id":"32fc77c1-c005-407c-8d28-8b8322d93a11","block_type":"box","text":"speculative characteristics. The obligor currently has the capacity to meet its financial","page_number":445,"box":{"x":226,"y":717,"width":632,"height":13}},{"id":"97f55e98-9c3f-4a73-8e5f-a94c2b034c33","block_type":"box","text":"commitments; however, it faces major ongoing uncertainties that could lead to the","page_number":445,"box":{"x":226,"y":733,"width":607,"height":12}},{"id":"7d061757-f672-40a5-b29c-388f4b9705c2","block_type":"box","text":"obligor’s inadequate capacity to meet its financial commitments.","page_number":445,"box":{"x":226,"y":748,"width":473,"height":13}},{"id":"9de593fe-e2ce-40d0-84e2-ed00244117b6","block_type":"box","text":"C A short-term obligation rated ‘C’ is currently vulnerable to nonpayment and is dependent","page_number":445,"box":{"x":117,"y":772,"width":763,"height":12}},{"id":"d9242032-b2dd-4b62-9573-b2cd23376cb0","block_type":"box","text":"upon favorable business, financial, and economic conditions for the obligor to meet its","page_number":445,"box":{"x":226,"y":787,"width":636,"height":12}},{"id":"33db258a-25c2-4741-aca8-7c7e89f453ce","block_type":"box","text":"financial commitments on the obligation.","page_number":445,"box":{"x":225,"y":803,"width":298,"height":12}},{"id":"eb849d5d-e48b-470b-a084-cffbf78a0712","block_type":"box","text":"A-6","page_number":445,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"38a4f74a-f367-4e0a-bb87-702b587d69ae","block_type":"box","text":"NM1026U-6004382-445/605","page_number":445,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f1f4b192-d894-426e-8bac-977f5f67b7db","block_type":"box","text":"D A short-term obligation rated ‘D’ is in default or in breach of an imputed promise. For","page_number":446,"box":{"x":117,"y":87,"width":739,"height":12}},{"id":"55fa78c3-2d94-4c48-a452-2a747666fe11","block_type":"box","text":"non-hybrid capital instruments, the ‘D’ rating category is used when payments on an","page_number":446,"box":{"x":226,"y":102,"width":629,"height":13}},{"id":"73d5b826-d7da-4d4d-8a41-6e50348c5784","block_type":"box","text":"obligation are not made on the date due, unless S&P believes that such payments will","page_number":446,"box":{"x":226,"y":118,"width":643,"height":12}},{"id":"8f2e5a22-81fd-4657-baba-46b7300522ba","block_type":"box","text":"be made within any stated grace period. However, any stated grace period longer than","page_number":446,"box":{"x":226,"y":134,"width":648,"height":12}},{"id":"d3940797-8c61-40de-9add-dc2d86105b62","block_type":"box","text":"five business days will be treated as five business days. The ‘D’ rating also will be used","page_number":446,"box":{"x":225,"y":149,"width":653,"height":12}},{"id":"13d5401d-f22c-41c8-bffb-382c3ea83020","block_type":"box","text":"upon the filing of a bankruptcy petition or the taking of a similar action and where default","page_number":446,"box":{"x":226,"y":165,"width":659,"height":12}},{"id":"8ae9dee1-2e04-49c6-8623-6fbf5f974e5f","block_type":"box","text":"on an obligation is a virtual certainty, for example due to automatic stay provisions. A","page_number":446,"box":{"x":226,"y":180,"width":635,"height":12}},{"id":"f5f8a7e4-05a2-4dd7-9e97-8c574c72b950","block_type":"box","text":"rating on an obligation is lowered to ‘D’ if it is subject to a distressed debt restructuring.","page_number":446,"box":{"x":226,"y":196,"width":648,"height":12}},{"id":"663abc00-1676-4ad4-a224-fb45d933939f","block_type":"box","text":"Description of S&P’s Municipal Short-Term Note Ratings","page_number":446,"box":{"x":117,"y":227,"width":456,"height":12}},{"id":"b6b3fc25-e4fd-46b9-8dc8-c380e04ba65d","block_type":"box","text":"An S&P U.S. municipal note rating reflects S&P’s opinion about the liquidity factors and market access","page_number":446,"box":{"x":116,"y":258,"width":766,"height":12}},{"id":"f6bfdcf9-56fb-4afb-ac6d-c7eb4b8be1ff","block_type":"box","text":"risks unique to the notes. Notes due in three years or less will likely receive a note rating. Notes with","page_number":446,"box":{"x":117,"y":273,"width":748,"height":12}},{"id":"a1e8b676-1697-470a-be48-50b6d5251f4c","block_type":"box","text":"an original maturity of more than three years will most likely receive a long-term debt rating. In","page_number":446,"box":{"x":116,"y":289,"width":703,"height":12}},{"id":"26de0ff1-9641-4520-ba29-23eea3ec0afa","block_type":"box","text":"determining which type of rating, if any, to assign, S&P’s analysis will review the following","page_number":446,"box":{"x":116,"y":304,"width":668,"height":12}},{"id":"0d2d934d-4d9a-4299-a06b-1e1612e1f845","block_type":"box","text":"considerations:","page_number":446,"box":{"x":116,"y":320,"width":118,"height":9}},{"id":"705330c4-bf86-4580-b313-8d4391430824","block_type":"box","text":"• Amortization schedule — the larger the final maturity relative to other maturities, the more likely it","page_number":446,"box":{"x":125,"y":351,"width":750,"height":12}},{"id":"5d6b42b5-7b97-4405-9653-d69af2c73a75","block_type":"box","text":"will be treated as a note; and","page_number":446,"box":{"x":149,"y":366,"width":220,"height":11}},{"id":"fbe71897-14f5-4c22-a07f-117091b5ed1b","block_type":"box","text":"• Source of payment — the more dependent the issue is on the market for its refinancing, the more","page_number":446,"box":{"x":125,"y":389,"width":753,"height":12}},{"id":"8c20166f-edc6-4515-9a69-0f2dd7757acd","block_type":"box","text":"likely it will be treated as a note.","page_number":446,"box":{"x":150,"y":405,"width":242,"height":12}},{"id":"921cf97d-5aaf-4da2-8dd9-c9a486aac921","block_type":"box","text":"S&P’s municipal short-term note rating symbols are as follows:","page_number":446,"box":{"x":116,"y":436,"width":470,"height":12}},{"id":"26928cc4-11ea-41b1-9600-df29aff0b838","block_type":"box","text":"SP-1 Strong capacity to pay principal and interest. An issue determined to possess a very","page_number":446,"box":{"x":116,"y":467,"width":739,"height":12}},{"id":"94553c32-8547-43b5-8a1b-0809ee18da48","block_type":"box","text":"strong capacity to pay debt service is given a plus (+) designation.","page_number":446,"box":{"x":226,"y":482,"width":496,"height":12}},{"id":"03160603-67ef-495d-a19d-3bcaa184370c","block_type":"box","text":"SP-2 Satisfactory capacity to pay principal and interest, with some vulnerability to adverse","page_number":446,"box":{"x":116,"y":506,"width":741,"height":12}},{"id":"e1cc09ed-61eb-4d7f-bcfb-daef3e31c3cd","block_type":"box","text":"financial and economic changes over the term of the notes.","page_number":446,"box":{"x":225,"y":521,"width":446,"height":12}},{"id":"48dc76b1-a030-456a-9251-2eb3da63e540","block_type":"box","text":"SP-3 Speculative capacity to pay principal and interest.","page_number":446,"box":{"x":116,"y":544,"width":482,"height":12}},{"id":"f7783273-e279-4bc6-8dd6-f583c0df9d85","block_type":"box","text":"D ‘D’ is assigned upon failure to pay the note when due, completion of a distressed debt","page_number":446,"box":{"x":117,"y":568,"width":750,"height":12}},{"id":"1b4c0cf3-66cc-4bdd-8c55-c9708a77e2f5","block_type":"box","text":"restructuring, or the filing of a bankruptcy petition or the taking of similar action and","page_number":446,"box":{"x":226,"y":583,"width":620,"height":12}},{"id":"a3458c8a-2307-45f9-89c6-64a68af6bc04","block_type":"box","text":"where default on an obligation is a virtual certainty, for example due to automatic stay","page_number":446,"box":{"x":225,"y":599,"width":640,"height":12}},{"id":"348e9aeb-d619-454c-b213-b44ecbf94901","block_type":"box","text":"provisions.","page_number":446,"box":{"x":226,"y":614,"width":84,"height":12}},{"id":"6e89e607-a2c2-4bd7-94ce-84fca7b15eeb","block_type":"box","text":"Description of Fitch Ratings’ (“Fitch’s”) Credit Ratings Scales","page_number":446,"box":{"x":117,"y":645,"width":498,"height":12}},{"id":"c432d9b7-2067-4077-8d12-848cd7e7435b","block_type":"box","text":"Fitch Ratings publishes opinions on a variety of scales. The most common of these are credit ratings,","page_number":446,"box":{"x":117,"y":676,"width":750,"height":12}},{"id":"a832ff18-cb1d-403a-8112-d91f0db0a354","block_type":"box","text":"but the agency also publishes ratings, scores and other relative opinions relating to financial or","page_number":446,"box":{"x":117,"y":692,"width":701,"height":12}},{"id":"eb54209e-6dd1-447d-968a-80a93ddfec8a","block_type":"box","text":"operational strength. For example, Fitch also provides specialized ratings of servicers of residential","page_number":446,"box":{"x":116,"y":707,"width":734,"height":12}},{"id":"b8baef45-c415-4d82-ba79-0c9fda4580c0","block_type":"box","text":"and commercial mortgages, asset managers and funds. In each case, users should refer to the","page_number":446,"box":{"x":116,"y":723,"width":706,"height":12}},{"id":"aa2bef6a-78d4-43b9-9ab1-e3518eff4569","block_type":"box","text":"definitions of each individual scale for guidance on the dimensions of risk covered in each assessment.","page_number":446,"box":{"x":116,"y":738,"width":763,"height":12}},{"id":"38113f5c-fd2c-4388-a061-cc5c5d439f19","block_type":"box","text":"Fitch’s credit ratings relating to issuers are an opinion on the relative ability of an entity to meet","page_number":446,"box":{"x":117,"y":769,"width":702,"height":12}},{"id":"d8d251e4-7b03-4890-a649-0766e47516ed","block_type":"box","text":"financial commitments, such as interest, preferred dividends, repayment of principal, insurance claims","page_number":446,"box":{"x":116,"y":785,"width":756,"height":12}},{"id":"bfe97880-f64e-477a-83b1-f4ecf44abaf6","block_type":"box","text":"or counterparty obligations. Credit ratings relating to securities and obligations of an issuer can include","page_number":446,"box":{"x":116,"y":800,"width":761,"height":12}},{"id":"44b4fce9-b674-4759-9277-2d0ed6f96641","block_type":"box","text":"a recovery expectation. Credit ratings are used by investors as indications of the likelihood of receiving","page_number":446,"box":{"x":116,"y":816,"width":761,"height":12}},{"id":"576b30b6-5c4d-45f3-99a2-df683a4d3589","block_type":"box","text":"the money owed to them in accordance with the terms on which they invested. The agency’s credit","page_number":446,"box":{"x":116,"y":831,"width":738,"height":12}},{"id":"91c881ea-fce7-4571-a02c-478cab85fd2d","block_type":"box","text":"ratings cover the global spectrum of corporate, sovereign financial, bank, insurance, and public finance","page_number":446,"box":{"x":117,"y":847,"width":768,"height":12}},{"id":"05bc9289-bd54-4602-8de3-6856f2a47f1c","block_type":"box","text":"entities (including supranational and sub-national entities) and the securities or other obligations they","page_number":446,"box":{"x":116,"y":862,"width":754,"height":12}},{"id":"35c07caf-274d-4fed-8cf4-4c9aef8c5dd2","block_type":"box","text":"issue, as well as structured finance securities backed by receivables or other financial assets.","page_number":446,"box":{"x":117,"y":878,"width":698,"height":12}},{"id":"0fbde894-82e8-442a-b3a8-c786c16c1168","block_type":"box","text":"A-7","page_number":446,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"0fa77e1f-39e6-40f1-8789-142dab2edd91","block_type":"box","text":"NM1026U-6004382-446/605","page_number":446,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"160f86db-109e-47a5-a1ec-b3d4df18bd44","block_type":"box","text":"The terms “investment grade” and “speculative grade” have established themselves over time as","page_number":447,"box":{"x":116,"y":87,"width":723,"height":12}},{"id":"2bfc5574-6bc3-4ce8-a237-7f4469342c51","block_type":"box","text":"shorthand to describe the categories ‘AAA’ to ‘BBB’ (investment grade) and ‘BB’ to ‘D’ (speculative","page_number":447,"box":{"x":116,"y":102,"width":737,"height":13}},{"id":"36dffaf9-8ba9-4256-965e-bcb052c1360a","block_type":"box","text":"grade). The terms investment grade and speculative grade are market conventions and do not imply","page_number":447,"box":{"x":116,"y":118,"width":749,"height":12}},{"id":"5c76523c-8f0a-44aa-abb4-35c5178949c4","block_type":"box","text":"any recommendation or endorsement of a specific security for investment purposes. Investment grade","page_number":447,"box":{"x":116,"y":134,"width":764,"height":12}},{"id":"58fb3551-f1a6-4569-b7f1-1220719abc89","block_type":"box","text":"categories indicate relatively low to moderate credit risk, while ratings in the speculative categories","page_number":447,"box":{"x":116,"y":149,"width":737,"height":12}},{"id":"1f0cb600-0c97-401c-969f-f8f6a164d577","block_type":"box","text":"either signal a higher level of credit risk or that a default has already occurred.","page_number":447,"box":{"x":116,"y":165,"width":584,"height":12}},{"id":"8535d16e-ba65-4c59-b763-29337e377a50","block_type":"box","text":"For the convenience of investors, Fitch may also include issues relating to a rated issuer that are not","page_number":447,"box":{"x":117,"y":196,"width":750,"height":12}},{"id":"df82421d-fb70-4774-9813-11c76c4cf7b6","block_type":"box","text":"and have not been rated on its web page. Such issues are also denoted as ‘NR’.","page_number":447,"box":{"x":116,"y":211,"width":603,"height":12}},{"id":"de556ef2-3d96-493e-9e95-b92fb325e974","block_type":"box","text":"Credit ratings express risk in relative rank order, which is to say they are ordinal measures of credit risk","page_number":447,"box":{"x":117,"y":242,"width":770,"height":12}},{"id":"eab2823f-b662-4c7e-9908-fe935050ad27","block_type":"box","text":"and are not predictive of a specific frequency of default or loss. For information about the historical","page_number":447,"box":{"x":116,"y":258,"width":735,"height":12}},{"id":"4f43b17e-559c-4607-9a09-3b4e69845544","block_type":"box","text":"performance of ratings please refer to Fitch’s Ratings Transition and Default studies which detail the","page_number":447,"box":{"x":117,"y":273,"width":747,"height":12}},{"id":"97d590ea-fb46-4e5d-a67e-2fc787b9bcbc","block_type":"box","text":"historical default rates and their meaning. The European Securities and Markets Authority also","page_number":447,"box":{"x":117,"y":289,"width":705,"height":12}},{"id":"4eb023fc-5302-4aeb-8cf7-450717a45fa4","block_type":"box","text":"maintains a central repository of historical default rates.","page_number":447,"box":{"x":117,"y":304,"width":415,"height":12}},{"id":"e312d7eb-bc00-4be3-992d-66b9ea547c0e","block_type":"box","text":"Fitch’s credit ratings do not directly address any risk other than credit risk. In particular, ratings do not","page_number":447,"box":{"x":117,"y":335,"width":756,"height":12}},{"id":"a9ee3abe-a358-4db1-b75c-a84686cb9bee","block_type":"box","text":"deal with the risk of a market value loss on a rated security due to changes in interest rates, liquidity","page_number":447,"box":{"x":116,"y":351,"width":747,"height":12}},{"id":"0e748e96-128a-4083-a7ee-d1094fb7b77c","block_type":"box","text":"and other market considerations. However, in terms of payment obligation on the rated liability, market","page_number":447,"box":{"x":116,"y":366,"width":765,"height":12}},{"id":"26fd37d7-3d48-468a-87ad-51f5355a068b","block_type":"box","text":"risk may be considered to the extent that it influences the ability of an issuer to pay upon a","page_number":447,"box":{"x":117,"y":382,"width":674,"height":12}},{"id":"4ad81ae0-9ccc-41f5-bd2d-d5256a3ced22","block_type":"box","text":"commitment.","page_number":447,"box":{"x":116,"y":397,"width":101,"height":10}},{"id":"9235e8d8-e367-49df-a98f-04f88bf4743a","block_type":"box","text":"Ratings nonetheless do not reflect market risk to the extent that they influence the size or other","page_number":447,"box":{"x":117,"y":428,"width":709,"height":12}},{"id":"5f6e5919-c310-450d-9bc4-ab81f971184c","block_type":"box","text":"conditionality of the obligation to pay upon a commitment (for example, in the case of index-linked","page_number":447,"box":{"x":116,"y":444,"width":731,"height":12}},{"id":"79f0688c-cdd9-45dd-871d-7342bc5c63b2","block_type":"box","text":"bonds).","page_number":447,"box":{"x":117,"y":459,"width":59,"height":12}},{"id":"0351964a-7ff1-4da4-866f-ac0bea3d76bc","block_type":"box","text":"In the default components of ratings assigned to individual obligations or instruments, the agency","page_number":447,"box":{"x":117,"y":490,"width":725,"height":12}},{"id":"b278bf4c-b5c0-488e-9d2f-90439c4a032a","block_type":"box","text":"typically rates to the likelihood of non-payment or default in accordance with the terms of that","page_number":447,"box":{"x":116,"y":506,"width":695,"height":12}},{"id":"d6ba58e7-ad9d-4179-8dd4-36a26575a5ce","block_type":"box","text":"instrument’s documentation. In limited cases, Fitch may include additional considerations (i.e. rate to a","page_number":447,"box":{"x":117,"y":521,"width":764,"height":12}},{"id":"01444686-fe34-482b-b9d9-1a044a5abfc8","block_type":"box","text":"higher or lower standard than that implied in the obligation’s documentation).","page_number":447,"box":{"x":117,"y":537,"width":573,"height":12}},{"id":"088a3941-5f6c-4e23-ae06-36254b56b989","block_type":"box","text":"The primary credit rating scales can be used to provide a rating of privately issued obligations or","page_number":447,"box":{"x":116,"y":568,"width":719,"height":12}},{"id":"0a50ac24-7a73-48bc-9356-c91cba39fc35","block_type":"box","text":"certain note issuance programs or for private ratings. In this case the rating is not published, but only","page_number":447,"box":{"x":116,"y":583,"width":753,"height":12}},{"id":"c7672888-bd36-40cd-8093-172a5402f24c","block_type":"box","text":"provided to the issuer or its agents in the form of a rating letter.","page_number":447,"box":{"x":117,"y":599,"width":472,"height":12}},{"id":"195839b8-9b74-48fa-8dd8-c2e882357b5f","block_type":"box","text":"The primary credit rating scales may also be used to provide ratings for a more narrow scope,","page_number":447,"box":{"x":116,"y":630,"width":702,"height":12}},{"id":"b29be722-0a75-4b34-93e7-729a39e58da2","block_type":"box","text":"including interest strips and return of principal or in other forms of opinions such as credit opinions or","page_number":447,"box":{"x":117,"y":645,"width":751,"height":12}},{"id":"8264e1ab-0e19-4d2f-a0f4-483d9c172cd9","block_type":"box","text":"rating assessment services. Credit opinions are either a notch- or category-specific view using the","page_number":447,"box":{"x":117,"y":661,"width":726,"height":12}},{"id":"cdf54e63-68d2-4bdf-9a98-6332f15af6a4","block_type":"box","text":"primary rating scale and omit one or more characteristics of a full rating or meet them to a different","page_number":447,"box":{"x":117,"y":676,"width":731,"height":12}},{"id":"5758f9d6-d99d-4fa3-94e6-7992a0982609","block_type":"box","text":"standard. Credit opinions will be indicated using a lower case letter symbol combined with either an ‘*’","page_number":447,"box":{"x":116,"y":692,"width":754,"height":12}},{"id":"fd999535-6209-4a9c-ad1f-c650c2d29e5a","block_type":"box","text":"(e.g. ‘bbb+*’) or (cat) suffix to denote the opinion status. Credit opinions will be point-in-time typically","page_number":447,"box":{"x":117,"y":707,"width":743,"height":12}},{"id":"f4f30a77-a058-4eb6-8798-250a85bef09d","block_type":"box","text":"but may be monitored if the analytical group believes information will be sufficiently available. Rating","page_number":447,"box":{"x":117,"y":723,"width":742,"height":12}},{"id":"5b103091-04eb-44a7-8c74-1b4f5ecf23b1","block_type":"box","text":"assessment services are a notch-specific view using the primary rating scale of how an existing or","page_number":447,"box":{"x":116,"y":738,"width":729,"height":12}},{"id":"4730be45-5ef9-43c3-9baa-fb7a6005ea05","block_type":"box","text":"potential rating may be changed by a given set of hypothetical circumstances. While credit opinions","page_number":447,"box":{"x":117,"y":754,"width":736,"height":12}},{"id":"8a3e8f42-361a-4e69-89b0-556b094088b1","block_type":"box","text":"and rating assessment services are point-in-time and are not monitored, they may have a directional","page_number":447,"box":{"x":116,"y":769,"width":745,"height":12}},{"id":"b1cc8771-1afb-4931-9eb4-9a119a58cdb4","block_type":"box","text":"watch or outlook assigned, which can signify the trajectory of the credit profile.","page_number":447,"box":{"x":116,"y":785,"width":579,"height":12}},{"id":"b16d43b3-fd9b-423e-ae59-c798ec53f5e1","block_type":"box","text":"Description of Fitch’s Long-Term Corporate Finance Obligations Rating Scales","page_number":447,"box":{"x":117,"y":816,"width":629,"height":12}},{"id":"a2f32977-0cd5-4b26-92a7-462e12e83bc5","block_type":"box","text":"Ratings of individual securities or financial obligations of a corporate issuer address relative","page_number":447,"box":{"x":117,"y":847,"width":682,"height":12}},{"id":"2e3c9f9b-1d9e-4165-b7c5-bc722553a620","block_type":"box","text":"vulnerability to default on an ordinal scale. In addition, for financial obligations in corporate finance, a","page_number":447,"box":{"x":116,"y":862,"width":752,"height":12}},{"id":"d96026a4-18e4-4658-93ac-d4cc88d8f9e1","block_type":"box","text":"measure of recovery given default on that liability is also included in the rating assessment. This","page_number":447,"box":{"x":117,"y":878,"width":716,"height":12}},{"id":"7812518c-212c-4463-9697-a109f4988f22","block_type":"box","text":"A-8","page_number":447,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"e6284be2-8c90-4f97-898a-c9a9b06fa49f","block_type":"box","text":"NM1026U-6004382-447/605","page_number":447,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"e629de93-fc03-49e7-9cdc-b1021c71904c","block_type":"box","text":"notably applies to covered bonds ratings, which incorporate both an indication of the probability of","page_number":448,"box":{"x":117,"y":87,"width":729,"height":12}},{"id":"b879caaa-bd2a-4ddb-a573-1051cc8612d2","block_type":"box","text":"default and of the recovery given a default of this debt instrument. On the contrary, Ratings of","page_number":448,"box":{"x":116,"y":102,"width":699,"height":13}},{"id":"6773a15d-af2b-4d0d-9b64-42c02b7c4580","block_type":"box","text":"debtor-in-possession (“DIP”) obligations incorporate the expectation of full repayment.","page_number":448,"box":{"x":116,"y":118,"width":642,"height":12}},{"id":"ce74d59e-965f-4b10-bcaf-9a572c311b41","block_type":"box","text":"The relationship between the issuer scale and obligation scale assumes a generic historical average","page_number":448,"box":{"x":116,"y":149,"width":750,"height":12}},{"id":"be15de11-9b65-4c1c-8937-c6203f090233","block_type":"box","text":"recovery. Individual obligations can be assigned ratings higher, lower, or the same as that entity’s","page_number":448,"box":{"x":117,"y":165,"width":728,"height":12}},{"id":"a1eca047-19ef-4048-a934-f47cb634308e","block_type":"box","text":"issuer rating or issuer default rating (“IDR”), based on their relative ranking, relative vulnerability to","page_number":448,"box":{"x":117,"y":180,"width":733,"height":12}},{"id":"dc7ad5e5-815c-424a-bb30-760873beaaa4","block_type":"box","text":"default or based on explicit Recovery Ratings.","page_number":448,"box":{"x":116,"y":196,"width":347,"height":12}},{"id":"88fc5b8c-7648-4730-a476-5681280271a8","block_type":"box","text":"As a result, individual obligations of entities, such as corporations, are assigned ratings higher, lower,","page_number":448,"box":{"x":116,"y":227,"width":756,"height":12}},{"id":"876b57ce-f1bc-46cd-84cd-b5decff4684b","block_type":"box","text":"or the same as that entity’s issuer rating or IDR, except DIP obligation ratings that are not based off an","page_number":448,"box":{"x":116,"y":242,"width":766,"height":12}},{"id":"bc5bfe9d-84d8-48fc-90a0-5f0b5acd90e7","block_type":"box","text":"IDR. At the lower end of the ratings scale, Fitch publishes explicit Recovery Ratings in many cases to","page_number":448,"box":{"x":117,"y":258,"width":756,"height":12}},{"id":"3dc60808-e9e5-419d-a7d9-2d36fe582236","block_type":"box","text":"complement issuer and obligation ratings.","page_number":448,"box":{"x":116,"y":273,"width":315,"height":12}},{"id":"7606ccd0-eb29-433e-b018-c831b694febe","block_type":"box","text":"Fitch long-term obligations rating scales are as follows:","page_number":448,"box":{"x":117,"y":304,"width":412,"height":12}},{"id":"1c974f28-0bd9-4b0b-866f-6f3d449b0044","block_type":"box","text":"AAA Highest Credit Quality. ‘AAA’ ratings denote the lowest expectation of credit risk. They","page_number":448,"box":{"x":116,"y":335,"width":753,"height":12}},{"id":"9047a5d4-a9c8-4636-9a47-3ae9cdaad47f","block_type":"box","text":"are assigned only in cases of exceptionally strong capacity for payment of financial","page_number":448,"box":{"x":226,"y":351,"width":619,"height":12}},{"id":"b1137dc3-1324-4cc5-a587-5caa6b8e4fee","block_type":"box","text":"commitments. This capacity is highly unlikely to be adversely affected by foreseeable","page_number":448,"box":{"x":226,"y":366,"width":636,"height":12}},{"id":"566ac2e5-0f1f-4ab2-b947-ff1c95896fcb","block_type":"box","text":"events.","page_number":448,"box":{"x":226,"y":382,"width":58,"height":9}},{"id":"3c351d6b-dc15-4b16-a9fd-ed8e03b6e7d4","block_type":"box","text":"AA Very High Credit Quality. ‘AA’ ratings denote expectations of very low credit risk. They","page_number":448,"box":{"x":116,"y":405,"width":753,"height":12}},{"id":"8d0239cc-c21d-48a8-b731-cdc47decc2be","block_type":"box","text":"indicate very strong capacity for payment of financial commitments. This capacity is not","page_number":448,"box":{"x":226,"y":420,"width":652,"height":12}},{"id":"0534360f-11eb-44ae-80ae-9fd09b6f20b3","block_type":"box","text":"significantly vulnerable to foreseeable events.","page_number":448,"box":{"x":226,"y":436,"width":343,"height":12}},{"id":"02824ad0-e0b3-4104-bbce-f18cc4706332","block_type":"box","text":"A High Credit Quality. ‘A’ ratings denote expectations of low credit risk. The capacity for","page_number":448,"box":{"x":116,"y":459,"width":748,"height":12}},{"id":"b074da26-25c8-407c-9381-2180b2320f46","block_type":"box","text":"payment of financial commitments is considered strong. This capacity may,","page_number":448,"box":{"x":226,"y":475,"width":562,"height":12}},{"id":"51b90f39-c8dd-4e61-9c76-769adc798674","block_type":"box","text":"nevertheless, be more vulnerable to adverse business or economic conditions than is","page_number":448,"box":{"x":226,"y":490,"width":638,"height":11}},{"id":"6ab7b5f9-8c45-49bd-bf7e-16613120a20d","block_type":"box","text":"the case for higher ratings.","page_number":448,"box":{"x":225,"y":506,"width":204,"height":12}},{"id":"48582f8a-df02-4f29-b939-6e665ef08a7e","block_type":"box","text":"BBB Good Credit Quality. ‘BBB’ ratings indicate that expectations of credit risk are currently","page_number":448,"box":{"x":117,"y":529,"width":755,"height":12}},{"id":"b244d0e5-84ac-4b85-ba67-74d860da53d9","block_type":"box","text":"low. 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The modifiers “+” or “-” may be appended to a rating","page_number":448,"box":{"x":116,"y":769,"width":759,"height":12}},{"id":"582d12eb-d634-4de6-8810-11dd0dbe66b3","block_type":"box","text":"to denote relative status within major rating categories.","page_number":448,"box":{"x":116,"y":785,"width":405,"height":12}},{"id":"0b5bb5cc-b72e-47bc-b558-8f1f79b24ad0","block_type":"box","text":"For example, the rating category ‘AA’ has three notch-specific rating levels (‘AA+’; ‘AA’; ‘AA–’; each a","page_number":448,"box":{"x":117,"y":816,"width":750,"height":12}},{"id":"5dd5bc36-7b70-40d7-8bb7-15bc544a75fb","block_type":"box","text":"rating level). Such suffixes are not added to ‘AAA’ ratings and ratings below the ‘CCC’ category. For","page_number":448,"box":{"x":117,"y":831,"width":745,"height":12}},{"id":"f1a0e056-48bf-4a76-954a-20c24e4467e0","block_type":"box","text":"the short-term rating category of ‘F1’, a ‘+’ may be appended.","page_number":448,"box":{"x":116,"y":847,"width":461,"height":12}},{"id":"c7ce0868-f2e8-4a9b-9360-a0cc37e71aff","block_type":"box","text":"A-9","page_number":448,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"da71c179-2a00-444c-a949-42a12fc200e7","block_type":"box","text":"NM1026U-6004382-448/605","page_number":448,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b7c5bd58-5c49-490c-b943-17833614ace1","block_type":"box","text":"Description of Fitch’s Short-Term Ratings Assigned to Issuers and Obligations","page_number":449,"box":{"x":117,"y":87,"width":634,"height":12}},{"id":"fb3bb8cb-6e87-4226-9749-08b8a8db720e","block_type":"box","text":"A short-term issuer or obligation rating is based in all cases on the short-term vulnerability to default of","page_number":449,"box":{"x":116,"y":118,"width":764,"height":12}},{"id":"1e76dcfe-c519-43f8-b078-d141acba526c","block_type":"box","text":"the rated entity and relates to the capacity to meet financial obligations in accordance with the","page_number":449,"box":{"x":116,"y":134,"width":701,"height":12}},{"id":"da349701-c050-4bfc-992c-8a5c88cc887a","block_type":"box","text":"documentation governing the relevant obligation. Short-term deposit ratings may be adjusted for loss","page_number":449,"box":{"x":116,"y":149,"width":753,"height":12}},{"id":"7a8c50af-fbac-4d3c-9c17-5679b7554274","block_type":"box","text":"severity. Short-term ratings are assigned to obligations whose initial maturity is viewed as “short term”","page_number":449,"box":{"x":116,"y":165,"width":760,"height":12}},{"id":"873143f8-0a1a-49b7-835b-8e9d4e93c6a9","block_type":"box","text":"based on market convention. Typically, this means up to 13 months for corporate, sovereign, and","page_number":449,"box":{"x":117,"y":180,"width":726,"height":12}},{"id":"6b4a1cc5-c463-455c-af9e-f2d19240b91b","block_type":"box","text":"structured obligations and up to 36 months for obligations in U.S. public finance markets.","page_number":449,"box":{"x":116,"y":196,"width":664,"height":12}},{"id":"e89a2b74-ea31-412c-b7fb-0365077f71f8","block_type":"box","text":"Fitch short-term ratings are as follows:","page_number":449,"box":{"x":117,"y":227,"width":289,"height":12}},{"id":"1249af8a-cd42-45d2-8d40-155e01fcb2e1","block_type":"box","text":"F1 Highest Short-Term Credit Quality. Indicates the strongest intrinsic capacity for timely","page_number":449,"box":{"x":117,"y":258,"width":746,"height":12}},{"id":"7b4a68e3-7f77-4e64-9e9d-2ee43d02afee","block_type":"box","text":"payment of financial commitments; may have an added “+” to denote any exceptionally","page_number":449,"box":{"x":226,"y":273,"width":650,"height":12}},{"id":"80326e01-87ff-41c2-b282-07b1a5588e13","block_type":"box","text":"strong credit feature.","page_number":449,"box":{"x":226,"y":289,"width":158,"height":12}},{"id":"7a9d4c85-9821-4a00-b474-71e996983d1c","block_type":"box","text":"F2 Good Short-Term Credit Quality. Good intrinsic capacity for timely payment of financial","page_number":449,"box":{"x":117,"y":312,"width":757,"height":12}},{"id":"6475a098-2373-4d00-9297-e518bd889294","block_type":"box","text":"commitments.","page_number":449,"box":{"x":226,"y":327,"width":109,"height":10}},{"id":"27000769-b9c5-4554-9277-3a6e42339bd8","block_type":"box","text":"F3 Fair Short-Term Credit Quality. The intrinsic capacity for timely payment of financial","page_number":449,"box":{"x":117,"y":351,"width":732,"height":12}},{"id":"c98b3a0d-e8a3-428d-8368-e7d960f84942","block_type":"box","text":"commitments is adequate.","page_number":449,"box":{"x":226,"y":366,"width":200,"height":12}},{"id":"502ab9da-739f-4063-90e7-ebbb6f816572","block_type":"box","text":"B Speculative Short-Term Credit Quality. Minimal capacity for timely payment of financial","page_number":449,"box":{"x":117,"y":389,"width":758,"height":12}},{"id":"e1f1bec6-9976-4a16-8cae-83766ceb811f","block_type":"box","text":"commitments, plus heightened vulnerability to near term adverse changes in financial","page_number":449,"box":{"x":226,"y":405,"width":638,"height":12}},{"id":"0147f271-a3bb-461e-b5d9-43a4317394ec","block_type":"box","text":"and economic conditions.","page_number":449,"box":{"x":226,"y":420,"width":194,"height":10}},{"id":"41036fed-c320-41ab-93d8-d3ffc289fca1","block_type":"box","text":"C High Short-Term Default Risk. Default is a real possibility.","page_number":449,"box":{"x":117,"y":444,"width":541,"height":12}},{"id":"61b812eb-77b9-4b17-af3c-fe4ac8efb772","block_type":"box","text":"RD Restricted Default. Indicates an entity that has defaulted on one or more of its financial","page_number":449,"box":{"x":117,"y":467,"width":756,"height":12}},{"id":"59e929d8-7b63-4d13-b9b8-e821ec6977a0","block_type":"box","text":"commitments, although it continues to meet other financial obligations. Typically","page_number":449,"box":{"x":226,"y":482,"width":598,"height":12}},{"id":"7e76ec2e-be4d-45b9-bc5d-ec3886d7350f","block_type":"box","text":"applicable to entity ratings only.","page_number":449,"box":{"x":226,"y":498,"width":239,"height":12}},{"id":"45703d31-dc43-4bfe-aac2-fbb0581af643","block_type":"box","text":"D Default. Indicates a broad-based default event for an entity, or the default of a short","page_number":449,"box":{"x":117,"y":521,"width":733,"height":12}},{"id":"490738c5-d2b7-443c-a8a0-b522608a5995","block_type":"box","text":"term obligation.","page_number":449,"box":{"x":225,"y":537,"width":120,"height":12}},{"id":"b6c26516-4205-4e20-910c-43def9ee6ab6","block_type":"box","text":"A-10","page_number":449,"box":{"x":482,"y":909,"width":35,"height":9}},{"id":"7711a37a-3739-4012-9b95-163aabdfc05c","block_type":"box","text":"NM1026U-6004382-449/605","page_number":449,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"67d9ea76-42d4-4f51-91af-679f55bb6b8c","block_type":"box","text":"Open-End Active and Fixed Income Index Fund Proxy Voting Policy","page_number":450,"box":{"x":380,"y":87,"width":508,"height":12}},{"id":"cfb5572d-c17d-4b50-802c-622160b42f29","block_type":"box","text":"APPENDIX B","page_number":450,"box":{"x":448,"y":118,"width":108,"height":9}},{"id":"e7302a1d-a8ad-4262-aac6-7d6318fd7e29","block_type":"box","text":"Open-End Active and Fixed Income Index Fund Proxy Voting Policy","page_number":450,"box":{"x":204,"y":146,"width":597,"height":14}},{"id":"c3f1e755-6e02-4c2e-a080-72d151f6d072","block_type":"box","text":"Procedures Governing Delegation of Proxy Voting to Fund Advisers","page_number":450,"box":{"x":229,"y":175,"width":547,"height":13}},{"id":"fddfb92b-201f-4f9d-8aba-da726f6e219b","block_type":"box","text":"Effective Date: January 1, 2025","page_number":450,"box":{"x":383,"y":204,"width":239,"height":12}},{"id":"90df48ca-3f88-419c-9d04-57a275f1194b","block_type":"box","text":"Applies to the following types of Funds registered under the 1940 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Policy.","page_number":450,"box":{"x":116,"y":386,"width":675,"height":12}},{"id":"d53a05f9-dabb-49da-bc04-76b0ed8e8798","block_type":"box","text":"Policy / Document Requirements and Statements","page_number":450,"box":{"x":117,"y":414,"width":396,"height":12}},{"id":"7ce30047-259f-446b-9574-5a31230be1f9","block_type":"box","text":"The Boards of Trustees/Directors (“Directors”) of certain open-end funds (the “Funds”) advised by","page_number":450,"box":{"x":116,"y":442,"width":730,"height":12}},{"id":"07c5146a-505f-4945-b1f3-302d5cd4b6e7","block_type":"box","text":"BlackRock Fund Advisors or BlackRock Advisors, LLC (“BlackRock”), have the responsibility for the","page_number":450,"box":{"x":117,"y":457,"width":743,"height":13}},{"id":"e552e01f-f258-4043-b797-aac8b85d72e8","block_type":"box","text":"oversight of voting proxies relating to portfolio securities of the Funds, and have determined that it is in","page_number":450,"box":{"x":116,"y":473,"width":765,"height":12}},{"id":"b23f5648-f297-4664-9ed6-11e86080251e","block_type":"box","text":"the best interests of the Funds and their shareholders to delegate the responsibility to vote proxies to","page_number":450,"box":{"x":116,"y":488,"width":754,"height":13}},{"id":"e7b4f66a-854d-48ba-8d24-2cca03f51348","block_type":"box","text":"BlackRock, subject to the principles outlined in this Policy, as part of BlackRock’s authority to manage,","page_number":450,"box":{"x":117,"y":504,"width":764,"height":12}},{"id":"65accf43-4b94-421a-916b-e047a2767174","block_type":"box","text":"acquire and dispose of account assets, all as contemplated by the Funds’ respective investment","page_number":450,"box":{"x":116,"y":519,"width":718,"height":13}},{"id":"0658d407-9028-4972-88b6-80a8e8f8cab3","block_type":"box","text":"management 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The Guidelines include “climate and decarbonization”","page_number":450,"box":{"x":117,"y":594,"width":741,"height":12}},{"id":"a35ae431-4b95-4b2e-bad2-85fec2cc8aa2","block_type":"box","text":"guidelines which apply to the Funds listed in Appendix A, if any.","page_number":450,"box":{"x":116,"y":610,"width":477,"height":12}},{"id":"23f3de83-df86-40fa-a924-8605d9d51ae6","block_type":"box","text":"BlackRock will cast votes on behalf of each of the Funds covered by this policy on specific proxy","page_number":450,"box":{"x":117,"y":638,"width":719,"height":12}},{"id":"f0dd7762-6844-4f55-8af8-d610f5057d64","block_type":"box","text":"issues in respect of securities held by each such Fund (or may refrain from voting) in accordance with","page_number":450,"box":{"x":117,"y":653,"width":759,"height":12}},{"id":"22e34eb1-c99a-40c1-b235-554d2b792d8f","block_type":"box","text":"the Guidelines.","page_number":450,"box":{"x":116,"y":669,"width":110,"height":9}},{"id":"f4ad35c9-2e03-48bb-a83f-9251c3c87688","block_type":"box","text":"Conflicts Management","page_number":450,"box":{"x":116,"y":697,"width":179,"height":12}},{"id":"635b6a81-2fdd-41c7-9e0a-12ae6892423a","block_type":"box","text":"BlackRock Active Investment Stewardship (“BAIS”) maintains policies and procedures that seek to","page_number":450,"box":{"x":117,"y":725,"width":729,"height":12}},{"id":"feb01f3b-da11-45ea-bc18-e1cb68272a29","block_type":"box","text":"prevent undue influence on BlackRock’s proxy voting activity and to mitigate material conflicts of","page_number":450,"box":{"x":117,"y":740,"width":714,"height":13}},{"id":"e86db0b3-3109-4f04-947a-cf4ac7d976e5","block_type":"box","text":"interest in the exercise of proxy voting responsibilities. Potential material conflicts, and the resultant","page_number":450,"box":{"x":117,"y":756,"width":736,"height":12}},{"id":"262f67a4-2871-4265-84a2-38b722c96d23","block_type":"box","text":"potential for undue influence, might be due to a relationship between the investee company (or any","page_number":450,"box":{"x":117,"y":771,"width":734,"height":13}},{"id":"d3ed118b-520d-41e9-8b03-0d9085dd3d87","block_type":"box","text":"shareholder proponent or dissident shareholder) and BlackRock, BlackRock’s affiliates or employees,","page_number":450,"box":{"x":116,"y":787,"width":752,"height":12}},{"id":"a70326e3-82e9-4d3d-b996-4f10ff095370","block_type":"box","text":"or a Fund or a Fund’s affiliates. BlackRock has taken certain steps to mitigate potential conflicts, which","page_number":450,"box":{"x":116,"y":802,"width":761,"height":13}},{"id":"6cbf36a6-eff8-46a8-97dc-9831c0f5eccf","block_type":"box","text":"are outlined in detail in the Guidelines. 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This document also includes BAIS’ decarbonization policy, which covers holdings in","page_number":455,"box":{"x":170,"y":828,"width":676,"height":10}},{"id":"887e92d0-aeee-4a74-a4c9-ae43f709dcf3","block_type":"box","text":"BlackRock active funds that have climate and decarbonization objectives in addition to financial objectives.","page_number":455,"box":{"x":171,"y":841,"width":631,"height":9}},{"id":"27104680-a796-4e79-878d-723ac99eb55e","block_type":"box","text":"2","page_number":455,"box":{"x":143,"y":854,"width":4,"height":5}},{"id":"49c8f6a6-cf92-4ba9-89d6-3796c84ec934","block_type":"box","text":"BlackRock segmented active and index equity investment functions, including stewardship, in January 2025 as part of a","page_number":455,"box":{"x":171,"y":854,"width":709,"height":9}},{"id":"84f1109c-82f9-49a3-82e9-4f9dfd7c92d9","block_type":"box","text":"strategic initiative to unlock the full breadth of the firm’s active and private markets capabilities for clients. 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The money BlackRock manages is not its","page_number":456,"box":{"x":117,"y":118,"width":741,"height":12}},{"id":"db984a80-cb07-41ca-8098-70187dce03a3","block_type":"box","text":"own — it belongs to BlackRock’s clients, many of whom make their own asset allocation and portfolio","page_number":456,"box":{"x":116,"y":134,"width":756,"height":12}},{"id":"09dd171a-6a85-4dd5-ae7c-e256ad58fcaf","block_type":"box","text":"construction decisions. As a fiduciary, BlackRock invests on clients’ behalf to help them meet their","page_number":456,"box":{"x":116,"y":149,"width":733,"height":12}},{"id":"74a592a8-b7b0-4d85-bf66-1764fd5a7c94","block_type":"box","text":"investment objectives. The firm does this by understanding clients’ long-term investment objectives","page_number":456,"box":{"x":117,"y":165,"width":739,"height":12}},{"id":"d0fc2b8e-6d43-43c7-9a0a-4ec8042e9c38","block_type":"box","text":"and offering choice on how and where they wish to invest their money. BlackRock then helps clients","page_number":456,"box":{"x":116,"y":180,"width":747,"height":12}},{"id":"b1efb644-d757-4c60-9557-0b7e113e5c02","block_type":"box","text":"seek the best risk-adjusted returns based on those choices, underpinning this work with research, data","page_number":456,"box":{"x":116,"y":196,"width":768,"height":12}},{"id":"40a48f9f-bc84-4095-b210-faba4db85313","block_type":"box","text":"and analytics.","page_number":456,"box":{"x":116,"y":211,"width":107,"height":12}},{"id":"de7f8713-3bc2-4bc1-96b7-d4d565dde2e3","block_type":"box","text":"At BlackRock, investment stewardship is core to our role as an asset manager and a fiduciary to our","page_number":456,"box":{"x":116,"y":242,"width":748,"height":12}},{"id":"78c99417-f14f-446a-9aef-959f02ebf964","block_type":"box","text":"clients. As stewards of our clients’ assets, we engage with companies to discuss the corporate","page_number":456,"box":{"x":116,"y":258,"width":706,"height":12}},{"id":"3f9bbfde-d8ea-43dd-9fe1-fc2ceeb86436","block_type":"box","text":"governance and business practices that, in our experience, support companies in delivering durable,","page_number":456,"box":{"x":116,"y":273,"width":751,"height":12}},{"id":"3bafee83-b5ac-42a2-81a9-e40626f107ae","block_type":"box","text":"risk-adjusted financial returns over time. We are committed to building strong relationships through","page_number":456,"box":{"x":117,"y":289,"width":736,"height":12}},{"id":"e452b8ec-90e5-4a2b-bdc4-da8087d003bf","block_type":"box","text":"constructive, ongoing dialogue with the boards and executive management of the companies in which","page_number":456,"box":{"x":116,"y":304,"width":760,"height":12}},{"id":"10079448-1f20-460a-99e5-cb5b7520a9e1","block_type":"box","text":"our clients are invested.","page_number":456,"box":{"x":116,"y":320,"width":182,"height":9}},{"id":"1529d9a9-05ad-46b2-9c74-27e34f297f5d","block_type":"box","text":"About BlackRock Active Investment Stewardship","page_number":456,"box":{"x":303,"y":351,"width":398,"height":11}},{"id":"021deeef-971d-425a-bb97-676847b17e3f","block_type":"box","text":"BlackRock Active Investment Stewardship (BAIS) is a specialist team within the Portfolio Management","page_number":456,"box":{"x":117,"y":382,"width":764,"height":12}},{"id":"d392a962-c256-4b7d-be85-d219061a8ba9","block_type":"box","text":"Group and manages BlackRock’s stewardship engagement and voting on behalf of clients invested in","page_number":456,"box":{"x":117,"y":397,"width":758,"height":12}},{"id":"bd03955f-19b4-4d88-aa39-be4f90241fed","block_type":"box","text":"active strategies globally. BAIS is also responsible for engagement with issuers in index fixed income","page_number":456,"box":{"x":116,"y":413,"width":755,"height":12}},{"id":"c836a127-d588-4d4b-a152-586cac9bd6b5","block_type":"box","text":"strategies, where appropriate. Our activities are informed by these Global Engagement and Voting","page_number":456,"box":{"x":116,"y":428,"width":735,"height":12}},{"id":"cdb1415a-a8f6-4e8b-a34e-c09af8a1efcd","block_type":"box","text":"Guidelines (the “Guidelines”) and insights from active investment analysts and portfolio managers, with","page_number":456,"box":{"x":117,"y":444,"width":768,"height":12}},{"id":"bafb2853-85c5-4dfb-982b-0bf18b667dbc","block_type":"box","text":"whom we work closely in engaging companies and voting at shareholder meetings.","page_number":456,"box":{"x":116,"y":459,"width":622,"height":12}},{"id":"ebb7f5dc-7084-4cfc-8b53-0fc1289174a7","block_type":"box","text":"Engagement with public companies is the foundation of our approach to stewardship within","page_number":456,"box":{"x":117,"y":490,"width":680,"height":12}},{"id":"72a509d0-ed3f-4969-8e8c-7f5959329556","block_type":"box","text":"fundamental active investing.","page_number":456,"box":{"x":116,"y":506,"width":215,"height":12}},{"id":"96b81ec3-1ccd-4781-9be0-0cd149f32769","block_type":"box","text":"3","page_number":456,"box":{"x":333,"y":506,"width":5,"height":6}},{"id":"76648d0b-351f-43db-9376-833e15d62017","block_type":"box","text":"Through direct dialogue with company leadership, we seek to","page_number":456,"box":{"x":339,"y":506,"width":466,"height":12}},{"id":"711d4780-978d-428f-b303-dd97d7bd145f","block_type":"box","text":"understand their businesses and how they manage risks and opportunities to deliver durable, risk","page_number":456,"box":{"x":117,"y":521,"width":727,"height":12}},{"id":"1f1562fb-ed1a-4ca6-8f6b-8cd1c54c1253","block_type":"box","text":"adjusted financial returns. Portfolio managers and stewardship specialists may engage jointly or","page_number":456,"box":{"x":116,"y":537,"width":716,"height":12}},{"id":"488bd944-72f9-4814-a63a-c76a818f7fb8","block_type":"box","text":"independently on material corporate governance matters. Our discussions focus on topics relevant to a","page_number":456,"box":{"x":117,"y":552,"width":769,"height":12}},{"id":"667de43f-acd0-4aa6-951b-d472788f3c59","block_type":"box","text":"company’s success over time, including governance and leadership, corporate strategy, capital","page_number":456,"box":{"x":116,"y":568,"width":711,"height":12}},{"id":"733b50e3-41b6-4372-8431-a3e6db6fecb1","block_type":"box","text":"structure and financial performance, operations and material sustainability-related risks, as well as","page_number":456,"box":{"x":116,"y":583,"width":734,"height":12}},{"id":"f43d2149-a602-4e6f-ad36-e768c9efc12e","block_type":"box","text":"macro-economic, geopolitical and sector dynamics. We aim to be constructive investors and are","page_number":456,"box":{"x":117,"y":599,"width":717,"height":12}},{"id":"3ec65f58-3f02-4b4b-98b9-213aea12c9d1","block_type":"box","text":"generally supportive of management teams that have a track record of financial value creation. We aim","page_number":456,"box":{"x":116,"y":614,"width":770,"height":12}},{"id":"9b39ed66-2475-47a7-9639-c01ba6bc07cb","block_type":"box","text":"to build and maintain strong relationships with company leadership based on open dialogue and","page_number":456,"box":{"x":116,"y":630,"width":717,"height":12}},{"id":"59661d66-853e-4162-a50f-1938b6950e63","block_type":"box","text":"mutual respect.","page_number":456,"box":{"x":117,"y":645,"width":118,"height":12}},{"id":"5dfeafd4-bba6-4ccc-a589-a8e02692aa90","block_type":"box","text":"Different active equity strategies may implement these voting guidelines differently, as a result of the","page_number":456,"box":{"x":117,"y":676,"width":744,"height":12}},{"id":"05ad9b2d-f639-4665-8686-8b2d8e7e7488","block_type":"box","text":"latitude each portfolio manager has to make independent voting decisions on their holdings. For","page_number":456,"box":{"x":117,"y":692,"width":711,"height":12}},{"id":"d80a6afa-3c58-4c52-a295-049fc740a865","block_type":"box","text":"example, BAIS will generally vote the holdings in Systematic Active Equity portfolios in accordance","page_number":456,"box":{"x":116,"y":707,"width":732,"height":12}},{"id":"24985978-5a49-4464-b4f3-5f4a2a754f77","block_type":"box","text":"with these guidelines. We provide voting recommendations to fundamental equity portfolio managers,","page_number":456,"box":{"x":116,"y":723,"width":751,"height":12}},{"id":"aa774bc0-b41a-4bf9-b6d2-b6fc6b28040f","block_type":"box","text":"who may determine to vote differently based on each portfolio’s investment objectives and strategy.","page_number":456,"box":{"x":116,"y":738,"width":737,"height":12}},{"id":"5a0b9be8-4f13-4b2c-8d7f-db56bc2c2e26","block_type":"box","text":"3","page_number":456,"box":{"x":143,"y":841,"width":4,"height":5}},{"id":"3e57f35f-1ca5-4219-8410-745dd7e30dd0","block_type":"box","text":"On February 11, 2025, the U.S. Securities and Exchange Commission (SEC) staff issued updated guidance for","page_number":456,"box":{"x":170,"y":841,"width":660,"height":9}},{"id":"8c51ee22-3bd3-48ef-ab45-a2f015115cc6","block_type":"box","text":"shareholders to maintain their eligibility to report their beneficial ownership under Schedule 13G of the Exchange Act.","page_number":456,"box":{"x":170,"y":854,"width":695,"height":9}},{"id":"a609593b-e107-42c4-9ca8-04f8a3d2ab27","block_type":"box","text":"We comply fully with these requirements and do not engage with portfolio companies for the purpose, or with the effect,","page_number":456,"box":{"x":170,"y":867,"width":707,"height":9}},{"id":"6d185cae-15b8-458c-a7d7-06044061dcdf","block_type":"box","text":"of changing or influencing control of the company.","page_number":456,"box":{"x":170,"y":880,"width":295,"height":9}},{"id":"ca1a016b-edc5-4bb0-b57d-ffc422d3542d","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":456,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"bf2eee63-3729-4d75-95c2-8869719e4bd5","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":456,"box":{"x":543,"y":909,"width":325,"height":12}},{"id":"6414c289-d507-48fa-a4fd-690c270269c6","block_type":"box","text":"4","page_number":456,"box":{"x":874,"y":909,"width":9,"height":9}},{"id":"a8d17d75-69d2-4b8e-8a4e-91785bcb1dd3","block_type":"box","text":"NM1026U-6004382-456/605","page_number":456,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f260cbce-a538-4b8c-8b74-de5dbf55f3b7","block_type":"box","text":"These guidelines discuss BAIS’ views on corporate governance topics on which we may engage with","page_number":457,"box":{"x":116,"y":87,"width":755,"height":12}},{"id":"dc0099f4-3f34-43bc-bd3a-65208a8b1045","block_type":"box","text":"management teams and board directors","page_number":457,"box":{"x":117,"y":103,"width":297,"height":12}},{"id":"cfa053ae-75ed-4ed4-a8c7-8f2c927b0775","block_type":"box","text":"4","page_number":457,"box":{"x":414,"y":103,"width":6,"height":6}},{"id":"37686a92-3673-435a-8582-bdc5454e44a1","block_type":"box","text":"and on matters that routinely come to a shareholder vote. We","page_number":457,"box":{"x":424,"y":103,"width":461,"height":12}},{"id":"fd220526-7b66-49d6-b694-7da5444257fd","block_type":"box","text":"recognize that accepted corporate governance norms can differ across markets, and believe these","page_number":457,"box":{"x":117,"y":118,"width":736,"height":12}},{"id":"967a5a5a-4846-40f4-950a-1207b4dd3829","block_type":"box","text":"guidelines represent globally applicable elements of governance that support a company’s ability to","page_number":457,"box":{"x":116,"y":134,"width":741,"height":12}},{"id":"4be1851f-6cdb-4e58-8a83-109b4f786aa1","block_type":"box","text":"manage material risks and opportunities and deliver financial returns to investors. Generally, we","page_number":457,"box":{"x":117,"y":149,"width":715,"height":12}},{"id":"71c801c3-1960-41bf-8041-ac7d8fe045a3","block_type":"box","text":"believe companies should observe accepted corporate governance norms within their local markets or,","page_number":457,"box":{"x":117,"y":165,"width":768,"height":12}},{"id":"3058c790-fe88-4579-8b97-7fa4ca31eaed","block_type":"box","text":"particularly in markets without well-established norms, aspire to widely recognized international best","page_number":457,"box":{"x":117,"y":180,"width":746,"height":12}},{"id":"a11f3d23-16fb-416e-be22-101266d738e1","block_type":"box","text":"practices. As one of many minority shareholders, BlackRock cannot — and does not try to — direct a","page_number":457,"box":{"x":117,"y":196,"width":754,"height":12}},{"id":"c1aeaaa5-fbdd-4709-b409-631b2f8c522e","block_type":"box","text":"company’s strategy or its implementation. We look to companies to provide disclosures that explain","page_number":457,"box":{"x":116,"y":211,"width":743,"height":12}},{"id":"dd43bf79-8dbd-4b85-8389-3be886235794","block_type":"box","text":"how their approach to corporate governance best aligns with the financial interests of their investors.","page_number":457,"box":{"x":117,"y":227,"width":749,"height":12}},{"id":"871dfe9e-6461-40e6-9942-f09e80d858e3","block_type":"box","text":"Our approach to stewardship within active equities","page_number":457,"box":{"x":296,"y":258,"width":412,"height":11}},{"id":"fa2aaa1d-b89c-4301-8632-b356db95156f","block_type":"box","text":"Voting at a company’s shareholder meeting is a right of share ownership and a core principle of","page_number":457,"box":{"x":116,"y":289,"width":713,"height":12}},{"id":"476a6668-6371-4a2b-831c-7159f2bf17d7","block_type":"box","text":"corporate governance. The voting rights attached to clients’ holdings are an important mechanism for","page_number":457,"box":{"x":116,"y":304,"width":756,"height":12}},{"id":"f0e044ad-0352-4d91-92b8-2fd8c3bf540b","block_type":"box","text":"investors to express support for, or concern about, a company’s performance. As a fiduciary,","page_number":457,"box":{"x":117,"y":320,"width":692,"height":12}},{"id":"5b6db05f-2b9a-4a2a-a84b-f53e9669b892","block_type":"box","text":"BlackRock is legally required to make proxy voting determinations, on behalf of clients who have","page_number":457,"box":{"x":117,"y":335,"width":720,"height":12}},{"id":"4ff42c1d-8950-463b-956b-ae7484db838b","block_type":"box","text":"delegated voting authority to us, in a manner consistent with BlackRock’s contractual arrangements","page_number":457,"box":{"x":116,"y":351,"width":743,"height":12}},{"id":"e879e7db-208b-41a3-a534-1f1c86bc4af6","block_type":"box","text":"with clients and funds.","page_number":457,"box":{"x":116,"y":366,"width":170,"height":10}},{"id":"4e8debe8-aa9d-486d-b7d9-0b7eb129739c","block_type":"box","text":"In general, we tend to support the recommendations of the board of directors and management. As","page_number":457,"box":{"x":117,"y":397,"width":740,"height":12}},{"id":"29fd202f-a999-4ce2-b76c-270157495b3b","block_type":"box","text":"indicated below, we may vote against management recommendations when we have concerns about","page_number":457,"box":{"x":117,"y":413,"width":755,"height":12}},{"id":"75338fed-af00-4a78-aa8e-5c4248b62cb1","block_type":"box","text":"how companies are serving the financial interests of our clients as their shareholders. BAIS takes a","page_number":457,"box":{"x":117,"y":428,"width":740,"height":12}},{"id":"a4521bc3-58d4-4928-a67a-4f06689dd237","block_type":"box","text":"globally consistent approach to voting but considers the different corporate governance regulations and","page_number":457,"box":{"x":116,"y":444,"width":772,"height":12}},{"id":"8b672f68-581e-4404-97d3-4f353bc8de7e","block_type":"box","text":"norms across markets. Votes are determined on a case-by-case basis, in the context of a company’s","page_number":457,"box":{"x":117,"y":459,"width":753,"height":12}},{"id":"796b5c76-3616-420c-a2b9-254741014a3c","block_type":"box","text":"situation and the investment mandate we have from clients. Please see page 19 for more information","page_number":457,"box":{"x":116,"y":475,"width":756,"height":12}},{"id":"72b36bc1-58ab-4a6a-955f-70b4e04f2644","block_type":"box","text":"about how we fulfill and oversee our investment stewardship responsibilities for BlackRock’s non-index","page_number":457,"box":{"x":116,"y":490,"width":768,"height":12}},{"id":"b9093aa7-1116-4056-8b51-1daa00b5cf47","block_type":"box","text":"equity strategies.","page_number":457,"box":{"x":116,"y":506,"width":125,"height":12}},{"id":"f95e055f-1678-4afa-84d6-0a850696b1cc","block_type":"box","text":"5","page_number":457,"box":{"x":243,"y":506,"width":6,"height":6}},{"id":"360f4685-1e64-4f20-a9c1-8edfa71edc9c","block_type":"box","text":"Our approach to stewardship within fixed income","page_number":457,"box":{"x":303,"y":537,"width":399,"height":12}},{"id":"4f17db8a-da9c-42b8-97d3-ae4d5a63523b","block_type":"box","text":"Although fixed income investors do not have the right to vote at shareholder meetings, issuer","page_number":457,"box":{"x":116,"y":568,"width":695,"height":12}},{"id":"e53138ed-0eb8-44b2-98f6-79291b1f3049","block_type":"box","text":"engagement is a component of fixed income investment strategies at BlackRock, particularly for those","page_number":457,"box":{"x":116,"y":583,"width":762,"height":12}},{"id":"583eb3ee-3e3d-4e9b-be72-2dbf385f5fbc","block_type":"box","text":"with sustainability objectives in addition to financial objectives. Most corporate governance-related","page_number":457,"box":{"x":116,"y":599,"width":732,"height":12}},{"id":"bc32f162-56c2-4308-b02f-7fcc52fa970b","block_type":"box","text":"fixed income engagements are undertaken in conjunction with the active investment stewardship team,","page_number":457,"box":{"x":116,"y":614,"width":770,"height":12}},{"id":"5e590cd9-e462-4276-9941-f0658ff388e2","block_type":"box","text":"and often active equity investors. In addition to the topics listed below, engagement with fixed income","page_number":457,"box":{"x":116,"y":630,"width":757,"height":12}},{"id":"4225133a-8e28-4c3e-92ec-0835d187580b","block_type":"box","text":"investment teams may help inform an issuer’s approach to structuring specialist issuances and the","page_number":457,"box":{"x":117,"y":645,"width":736,"height":12}},{"id":"fb4c3c13-e631-43d9-bd42-d9d7e8ae8744","block_type":"box","text":"standard terms and information in bond documentation.","page_number":457,"box":{"x":116,"y":661,"width":411,"height":9}},{"id":"4838eee5-79fb-4d53-8cbc-dab67c5b0aef","block_type":"box","text":"4","page_number":457,"box":{"x":143,"y":828,"width":4,"height":5}},{"id":"b0c1502a-1ab6-4483-b8a0-c896487cc04f","block_type":"box","text":"References to the board, board directors or non-executive directors should be understood to include supervisory boards","page_number":457,"box":{"x":171,"y":828,"width":710,"height":10}},{"id":"9c1d54fa-e7bd-44b3-90e4-2ba1872fbdcd","block_type":"box","text":"and their members, where relevant.","page_number":457,"box":{"x":170,"y":841,"width":210,"height":9}},{"id":"da49d203-5932-448f-a14b-59eff2d06449","block_type":"box","text":"5","page_number":457,"box":{"x":143,"y":854,"width":4,"height":5}},{"id":"79518603-ffc9-4c59-8106-6df9326e788f","block_type":"box","text":"Non-index equity strategies include active equity holdings in BlackRock’s fundamental equity, systematic equity and","page_number":457,"box":{"x":171,"y":854,"width":685,"height":9}},{"id":"83ab13b2-357e-4cf7-af9f-475ccc013f0a","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":457,"box":{"x":170,"y":867,"width":678,"height":9}},{"id":"76e7c221-60a2-42f7-90f1-52d4248e18f1","block_type":"box","text":"extent those strategies hold voting securities or conduct issuer engagements.","page_number":457,"box":{"x":170,"y":880,"width":458,"height":9}},{"id":"4f10b567-69a8-4f83-b588-8d0c96ca8912","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":457,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"3cb87915-529f-47e6-bff0-1d47fd663cc1","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":457,"box":{"x":543,"y":909,"width":325,"height":12}},{"id":"12d9ea6d-d4e0-4ae6-bad1-57c06620873b","block_type":"box","text":"5","page_number":457,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"31438b61-c247-4551-8715-b7e02ef715b4","block_type":"box","text":"NM1026U-6004382-457/605","page_number":457,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"25b04808-99cf-48e7-a189-39539a1dda2e","block_type":"box","text":"Boards of Directors","page_number":458,"box":{"x":422,"y":87,"width":161,"height":10}},{"id":"17ea39df-c3be-4539-ad72-05a5957d49f6","block_type":"box","text":"Roles and responsibilities","page_number":458,"box":{"x":117,"y":118,"width":212,"height":12}},{"id":"baf33a4b-f627-4821-ac3c-456e89a1c7f7","block_type":"box","text":"There is widespread consensus that the foundation of good corporate governance is an effective board","page_number":458,"box":{"x":116,"y":149,"width":770,"height":12}},{"id":"a3c1a97d-725f-42c9-84e7-7ae9a57d840d","block_type":"box","text":"of directors that is able to advise and supervise management in an independent and objective","page_number":458,"box":{"x":116,"y":165,"width":700,"height":12}},{"id":"ea49ed9b-391a-4e09-8c57-0297375978b8","block_type":"box","text":"manner.","page_number":458,"box":{"x":117,"y":183,"width":59,"height":7}},{"id":"c891f0af-2fc2-4690-9942-5012714aee74","block_type":"box","text":"6","page_number":458,"box":{"x":178,"y":180,"width":5,"height":6}},{"id":"898514c8-4261-4144-8dff-3e52f4fe5a23","block_type":"box","text":"We look to the board of directors (hereafter the “board”) to have an oversight role in the establishment","page_number":458,"box":{"x":116,"y":211,"width":762,"height":12}},{"id":"333d6d33-3dde-4f4c-991f-5e30871e352c","block_type":"box","text":"and realization of a company’s strategy, purpose and culture. These constructs are interdependent","page_number":458,"box":{"x":116,"y":227,"width":738,"height":12}},{"id":"5f1fc4a1-d597-4e25-afbb-761097f082f8","block_type":"box","text":"and, when aligned, can better position a company to be resilient in the face of a changing business","page_number":458,"box":{"x":116,"y":242,"width":739,"height":12}},{"id":"29d270b8-ed54-4cfd-99e8-6332adde616c","block_type":"box","text":"environment, help reduce the risks of corporate or employee misconduct, and attract and retain the","page_number":458,"box":{"x":116,"y":258,"width":740,"height":12}},{"id":"50f6587a-8a66-4817-b167-6b1053c61f9c","block_type":"box","text":"caliber of workers necessary to deliver financial performance over time.","page_number":458,"box":{"x":116,"y":273,"width":535,"height":12}},{"id":"a673208c-6059-4bb7-858c-4deb6d8f6d1b","block_type":"box","text":"In overseeing the management of the company, the board ensures the necessary resources, policies","page_number":458,"box":{"x":117,"y":304,"width":754,"height":12}},{"id":"8ffb622c-b17d-4044-a35e-b72cc44ce4b6","block_type":"box","text":"and procedures are in place to help management meet its strategic objectives within an agreed risk","page_number":458,"box":{"x":116,"y":320,"width":742,"height":12}},{"id":"476b13c6-1ac9-4a31-ac52-4d7415d97aba","block_type":"box","text":"tolerance.","page_number":458,"box":{"x":116,"y":335,"width":78,"height":10}},{"id":"622e144d-7b8a-4a26-8f61-8f7f7e558a97","block_type":"box","text":"One of the most important responsibilities of the board is to appoint, and remove as necessary, the","page_number":458,"box":{"x":116,"y":366,"width":739,"height":12}},{"id":"fb792560-50cf-4fc9-9f46-8d92dc6edda3","block_type":"box","text":"chief executive officer (“CEO”). In addition, the board plays a meaningful role in monitoring the","page_number":458,"box":{"x":116,"y":382,"width":704,"height":12}},{"id":"839eae80-f3d1-4cdc-8871-9bf8df321ceb","block_type":"box","text":"performance of the CEO and other key executives, determining executive compensation, ensuring a","page_number":458,"box":{"x":117,"y":397,"width":747,"height":12}},{"id":"3ce6279c-c202-4768-b97e-e516a1840d11","block_type":"box","text":"rigorous audit, overseeing strategy execution and risk management and engaging with shareholders,","page_number":458,"box":{"x":117,"y":413,"width":753,"height":12}},{"id":"1b104a3f-ef70-41d4-bf1e-6a8cdc94561e","block_type":"box","text":"and other stakeholders, as necessary.","page_number":458,"box":{"x":116,"y":428,"width":289,"height":12}},{"id":"5b044b0e-373c-462c-a46a-7c41767efdf5","block_type":"box","text":"Composition and effectiveness","page_number":458,"box":{"x":116,"y":467,"width":253,"height":12}},{"id":"d3f8c591-f904-4b0a-bb9b-b1de25b4d24f","block_type":"box","text":"Appointment process","page_number":458,"box":{"x":116,"y":498,"width":177,"height":12}},{"id":"93a73256-0053-4c9c-b641-216fea9cd5ec","block_type":"box","text":"A formal and transparent process for identifying and appointing director candidates is critical to","page_number":458,"box":{"x":116,"y":529,"width":708,"height":12}},{"id":"7dd15a6d-e2db-4af7-9d7e-f9db5495da3d","block_type":"box","text":"ensuring the board is composed of directors with the appropriate mix of skills and experience.","page_number":458,"box":{"x":116,"y":544,"width":700,"height":12}},{"id":"94015e35-826a-4a21-afd2-cd308d4c5a88","block_type":"box","text":"Generally, the board or a sub-committee determines the general criteria given the company’s","page_number":458,"box":{"x":117,"y":560,"width":695,"height":12}},{"id":"66c7459b-3e76-4896-9135-1df47684d79c","block_type":"box","text":"circumstances (e.g., sector, maturity, geographic footprint) and any additional criteria for a specific role","page_number":458,"box":{"x":116,"y":575,"width":767,"height":12}},{"id":"ef77a53b-e1fb-4e94-8488-62f110333b1e","block_type":"box","text":"being filled (e.g., financial expertise, industry track record). To inform the process, we encourage","page_number":458,"box":{"x":117,"y":591,"width":721,"height":12}},{"id":"9de45640-0536-4f29-af1e-4e5744fd47f1","block_type":"box","text":"companies to review the skills and experience of incumbent directors to identify any gaps and whether","page_number":458,"box":{"x":116,"y":606,"width":764,"height":12}},{"id":"462378ca-5513-4dec-bc19-86e6988c1458","block_type":"box","text":"the skills and experience of a director candidate would be additive. We welcome disclosures that","page_number":458,"box":{"x":116,"y":622,"width":722,"height":12}},{"id":"e10a80d9-16f8-42d4-bb56-34f2e0ea13be","block_type":"box","text":"explain how the board considered different skills and experience to ensure that the directors","page_number":458,"box":{"x":116,"y":637,"width":687,"height":12}},{"id":"5f54287b-9bf9-47ac-9f03-2dd17c63d53d","block_type":"box","text":"collectively can be effective in fulfilling their responsibilities. We assess a company’s board","page_number":458,"box":{"x":116,"y":653,"width":678,"height":12}},{"id":"9dcace3a-5e1b-4110-b64a-6e21dc8b149f","block_type":"box","text":"composition against that of its peer group and local market requirements.","page_number":458,"box":{"x":116,"y":668,"width":542,"height":12}},{"id":"bc446d21-7b78-4bd3-92bf-4d58b9ed6e04","block_type":"box","text":"Shareholders periodically vote to elect directors to serve on the board. We do not prescribe any","page_number":458,"box":{"x":116,"y":699,"width":709,"height":13}},{"id":"e01d8a2d-0318-4dff-ad92-ab6df2d78581","block_type":"box","text":"particular board composition in our engagements or voting but seek to understand how well placed a","page_number":458,"box":{"x":117,"y":715,"width":746,"height":12}},{"id":"ec3f7db7-10cd-45b8-95c4-635e2948d20c","block_type":"box","text":"board is to act in investors’ interests. We may vote against the election of the most senior independent","page_number":458,"box":{"x":117,"y":730,"width":760,"height":13}},{"id":"e85a4b29-c585-41bd-a610-d8e0e1a35257","block_type":"box","text":"director, or the chair of the relevant committee, where a company has not demonstrated it has an","page_number":458,"box":{"x":116,"y":746,"width":720,"height":12}},{"id":"209dbbfc-ab37-469e-9a61-57b0f72ac5ee","block_type":"box","text":"appointment process that results in a high functioning board with the appropriate complement of skills","page_number":458,"box":{"x":116,"y":761,"width":753,"height":13}},{"id":"555eaf96-d2b8-451d-b6e4-cc9a395ac18d","block_type":"box","text":"and experience amongst the directors to support strong financial performance over time. We may vote","page_number":458,"box":{"x":116,"y":777,"width":759,"height":12}},{"id":"36d3045e-6f94-4adc-9466-b3eeb92c8dc4","block_type":"box","text":"against newly nominated directors who do not seem to have the appropriate skills or experience to","page_number":458,"box":{"x":116,"y":793,"width":731,"height":12}},{"id":"dba8266c-7e3c-4f8e-b756-baed02f8365a","block_type":"box","text":"contribute to the board’s effectiveness.","page_number":458,"box":{"x":116,"y":808,"width":286,"height":9}},{"id":"bc1c7825-0c8c-4bf9-9037-0818dadd1db9","block_type":"box","text":"6","page_number":458,"box":{"x":143,"y":867,"width":4,"height":5}},{"id":"a2ac0525-0016-4edb-b443-1779d73ce042","block_type":"box","text":"See the Corporate Governance Codes of Germany, Japan, and the UK, as well as the corporate governance principles","page_number":458,"box":{"x":170,"y":867,"width":706,"height":9}},{"id":"21622cc0-8d87-4fe9-a7e6-6a62f2dc6516","block_type":"box","text":"of the US Business Roundtable as examples.","page_number":458,"box":{"x":170,"y":880,"width":268,"height":9}},{"id":"f17b6420-ea17-4041-a50d-eb75279af867","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":458,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"83714ab3-2e6a-45da-a02a-5f98cbb17ad3","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":458,"box":{"x":543,"y":909,"width":325,"height":12}},{"id":"7e8167c8-b6da-4e56-8d4e-b845a959dc55","block_type":"box","text":"6","page_number":458,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"94f3f294-919b-4792-a2ba-5f14abbac33f","block_type":"box","text":"NM1026U-6004382-458/605","page_number":458,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"83cc751d-5728-422c-a9b6-51d13c5377a8","block_type":"box","text":"Independence","page_number":459,"box":{"x":116,"y":87,"width":118,"height":12}},{"id":"71493e5f-4ba1-40a7-94e5-d9cddf865047","block_type":"box","text":"Director independence from management, significant shareholders or other stakeholders (e.g.,","page_number":459,"box":{"x":117,"y":118,"width":706,"height":12}},{"id":"1a5ba188-9691-4fa3-9e3b-9b9242ec43eb","block_type":"box","text":"government or employees) is of paramount importance to the protection of the interests of minority","page_number":459,"box":{"x":116,"y":134,"width":736,"height":12}},{"id":"6c54ea4d-ae6a-43df-a744-004b3a675388","block_type":"box","text":"shareholders such as BlackRock’s clients. We consider it good practice for at least half the directors to","page_number":459,"box":{"x":116,"y":149,"width":766,"height":12}},{"id":"827053df-79a5-41ca-a38b-7548c3e3ae26","block_type":"box","text":"be independent and free from conflicts of interest or undue influence.","page_number":459,"box":{"x":117,"y":165,"width":510,"height":11}},{"id":"ebbbcb58-7d4f-4e55-a4a6-5ff909b2a32f","block_type":"box","text":"7","page_number":459,"box":{"x":629,"y":165,"width":5,"height":6}},{"id":"4b739d8d-3314-49c6-b585-89114652b47a","block_type":"box","text":"This also helps to ensure that","page_number":459,"box":{"x":635,"y":165,"width":229,"height":11}},{"id":"816fa68c-0a38-411d-b575-8e03eab7bc67","block_type":"box","text":"board committees are composed of a sufficient number of independent directors. Companies domiciled","page_number":459,"box":{"x":117,"y":180,"width":770,"height":12}},{"id":"bd3655da-e019-4d05-8e24-7d4e0c0f6904","block_type":"box","text":"in markets with a higher threshold for board independence should meet those local requirements.","page_number":459,"box":{"x":117,"y":196,"width":727,"height":12}},{"id":"c17aa5f0-34f5-4fab-a64a-bbf169faed6e","block_type":"box","text":"We may vote against the election of non-independent directors if the board does not have a sufficient","page_number":459,"box":{"x":116,"y":227,"width":756,"height":12}},{"id":"934d83e9-a927-4947-a572-9531d62e204b","block_type":"box","text":"balance of independence. We may also vote against the election of the chair of the committee","page_number":459,"box":{"x":117,"y":242,"width":701,"height":12}},{"id":"912a20f9-66ff-42fb-9fa6-71b43b91d5dc","block_type":"box","text":"responsible for board composition if this is a perennial issue.","page_number":459,"box":{"x":117,"y":258,"width":453,"height":11}},{"id":"d0373d25-b261-4175-b916-af76db11fb20","block_type":"box","text":"Independent board leadership","page_number":459,"box":{"x":116,"y":289,"width":245,"height":11}},{"id":"414d87fc-d632-4150-8f45-8602fe4e0d23","block_type":"box","text":"Practices across markets differ, as do board structures, but we observe two main approaches to","page_number":459,"box":{"x":117,"y":320,"width":718,"height":12}},{"id":"0a5fb679-ce90-4fef-bd99-74848dc339c0","block_type":"box","text":"independent board leadership. One is a non-executive, independent chair of the board who is","page_number":459,"box":{"x":117,"y":335,"width":697,"height":12}},{"id":"0a3f4529-b6b3-4245-834e-a72bfa6dfe15","block_type":"box","text":"responsible for leading the board in the effective exercise of its duties. The other is a lead or senior","page_number":459,"box":{"x":117,"y":351,"width":738,"height":12}},{"id":"09448886-680a-4c46-b6ab-35120922d460","block_type":"box","text":"independent director, who is responsible for coordinating with the other non-executive directors and","page_number":459,"box":{"x":117,"y":366,"width":742,"height":12}},{"id":"b957cd4c-2ebd-42c9-8b2c-56fd7215bc91","block_type":"box","text":"working closely with the executive chair on the board agenda and other board procedures. In this case,","page_number":459,"box":{"x":116,"y":382,"width":770,"height":12}},{"id":"53e61bdb-3ea1-4490-a023-8af0ac66cb8f","block_type":"box","text":"the executive chair and the lead independent director work together to ensure the board is effectively","page_number":459,"box":{"x":116,"y":397,"width":754,"height":12}},{"id":"5e98ee0b-4654-419c-8f0d-deaaec01a270","block_type":"box","text":"fulfilling its responsibilities. In our view, the independent leader of the board, and/or the chair of a","page_number":459,"box":{"x":116,"y":413,"width":723,"height":12}},{"id":"e8f6f60e-6651-46f6-b783-ed954d45db59","block_type":"box","text":"relevant committee, should be available to investors to discuss governance matters such as CEO","page_number":459,"box":{"x":117,"y":428,"width":727,"height":12}},{"id":"7afb2e38-39b7-4730-ac46-167c5b08e6c6","block_type":"box","text":"succession, executive pay, and board performance. We look to boards to explain their board","page_number":459,"box":{"x":116,"y":444,"width":691,"height":12}},{"id":"b651042f-759f-4a91-8818-02868ff9c4f4","block_type":"box","text":"leadership model and how it serves the interests of shareholders.","page_number":459,"box":{"x":117,"y":459,"width":489,"height":12}},{"id":"fb185e48-c386-403a-9bb2-a4c7bbf3857a","block_type":"box","text":"We may vote against the election of the chair of the committee responsible for board composition if","page_number":459,"box":{"x":116,"y":490,"width":740,"height":12}},{"id":"8ba51a95-7957-4e8e-8d48-bd5da51c554c","block_type":"box","text":"there is not an identified independent leader of the board with clear responsibilities for board","page_number":459,"box":{"x":116,"y":506,"width":689,"height":12}},{"id":"94e2d0a3-57df-49da-8a1f-1e4032bff481","block_type":"box","text":"performance. We may vote against the most senior independent director if the board has a policy of","page_number":459,"box":{"x":117,"y":521,"width":744,"height":12}},{"id":"f943bb6e-bb49-4f7f-a643-f23d5ae66307","block_type":"box","text":"not engaging with shareholders.","page_number":459,"box":{"x":117,"y":537,"width":242,"height":12}},{"id":"1d5df090-f40a-4490-bf4d-d47ac2122e51","block_type":"box","text":"Tenure and succession","page_number":459,"box":{"x":118,"y":568,"width":189,"height":9}},{"id":"0130125a-37f9-447e-8bfa-fd930bb6065d","block_type":"box","text":"In our view, it is good practice for boards to establish the length of time a director would normally be","page_number":459,"box":{"x":117,"y":599,"width":745,"height":12}},{"id":"d294e5e4-b501-4b5b-929a-103c87b32b80","block_type":"box","text":"expected to serve, in line with market norms where those exist. We find it helpful when companies","page_number":459,"box":{"x":116,"y":614,"width":733,"height":12}},{"id":"cd979fdb-795c-4e58-b005-5029263ef4c4","block_type":"box","text":"disclose their approach to director tenure particularly around the contributions of directors who have","page_number":459,"box":{"x":116,"y":630,"width":745,"height":12}},{"id":"369cb864-201b-4c88-a017-921f5222a5f7","block_type":"box","text":"served for longer periods than typically provided for under local practice. In our experience, long","page_number":459,"box":{"x":116,"y":645,"width":718,"height":12}},{"id":"39f12667-6fb4-42d6-99b3-5ef1c530cc9f","block_type":"box","text":"serving directors could become less independent given their long-term relationship with management","page_number":459,"box":{"x":116,"y":661,"width":751,"height":12}},{"id":"dd505654-9be3-4e94-bf96-9c49b60ac40b","block_type":"box","text":"and involvement in past board decisions.","page_number":459,"box":{"x":116,"y":676,"width":302,"height":12}},{"id":"d3434870-8059-41c7-85c1-90263bad015a","block_type":"box","text":"Succession planning for board roles helps achieve the appropriate cadence of turnover that balances","page_number":459,"box":{"x":116,"y":707,"width":750,"height":12}},{"id":"08afa00b-87ef-451b-b146-ddd10feed459","block_type":"box","text":"renewal through the regular introduction of directors with fresh perspectives and expertise with","page_number":459,"box":{"x":117,"y":723,"width":699,"height":12}},{"id":"fd00afad-2339-4bbb-937e-416e09da4030","block_type":"box","text":"continuity through the retention of directors with long-term knowledge of the board and company.","page_number":459,"box":{"x":116,"y":738,"width":718,"height":12}},{"id":"1689fb10-391a-4c5b-908c-70f1039113b0","block_type":"box","text":"In markets where there is not specific director tenure guidance from regulation or corporate","page_number":459,"box":{"x":117,"y":769,"width":675,"height":12}},{"id":"a94f1e7b-4f19-4820-9571-4d23ce2aa201","block_type":"box","text":"governance best practices, we may vote against the election of the chair of the committee responsible","page_number":459,"box":{"x":116,"y":785,"width":757,"height":12}},{"id":"9b57aac6-24fa-42fa-bef1-08261d51e7e2","block_type":"box","text":"for board composition if a company does not clearly disclose its approach to director tenure and board","page_number":459,"box":{"x":116,"y":800,"width":757,"height":12}},{"id":"e311eaf7-d82e-40e8-ba9e-19b1bbec98e5","block_type":"box","text":"7","page_number":459,"box":{"x":143,"y":828,"width":4,"height":5}},{"id":"3f3cd554-cd6b-4277-8e14-eaf23222457e","block_type":"box","text":"Common impediments to independence may include but are not limited to: current or recent employment at the","page_number":459,"box":{"x":170,"y":828,"width":659,"height":10}},{"id":"ce3921a7-dae2-4799-b979-2c85a5de44d4","block_type":"box","text":"company or a subsidiary; being, or representing, a shareholder with a substantial shareholding in the company;","page_number":459,"box":{"x":170,"y":841,"width":659,"height":9}},{"id":"faef7b6d-cd74-4823-99e8-3261b4b4f664","block_type":"box","text":"interlocking directorships; lengthy tenure, and having any other interest, business, or other relationship which could, or","page_number":459,"box":{"x":170,"y":854,"width":702,"height":9}},{"id":"8b723a86-8e4d-47eb-92a4-89c6a04fd140","block_type":"box","text":"could reasonably be perceived to, materially interfere with a director’s ability to act in the best interests of the company","page_number":459,"box":{"x":170,"y":867,"width":703,"height":9}},{"id":"465a6c9a-dc09-4620-bda9-bd22731afd88","block_type":"box","text":"and shareholders.","page_number":459,"box":{"x":170,"y":880,"width":106,"height":7}},{"id":"918f3d8b-1ac0-47f8-bb7b-948270214f06","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":459,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"b314d139-fcff-462b-9c70-3a2bcb6a41f6","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":459,"box":{"x":543,"y":909,"width":325,"height":12}},{"id":"bf53a8c6-2a4b-4599-9cef-5f5023d035fb","block_type":"box","text":"7","page_number":459,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"3e5ab0c6-df37-40f7-987d-7050330c6df9","block_type":"box","text":"NM1026U-6004382-459/605","page_number":459,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"bcc91b07-1c49-42cd-9cda-268d19cbab50","block_type":"box","text":"renewal. We may vote against the election of directors who have served for more years than is typical","page_number":460,"box":{"x":117,"y":87,"width":760,"height":12}},{"id":"16de0546-f699-4ebc-83eb-a65ca0370c63","block_type":"box","text":"in markets with specific guidance, where the case for their continued service is not evident.","page_number":460,"box":{"x":117,"y":102,"width":679,"height":13}},{"id":"f38f82d8-04c9-45c6-b564-20e1890c4bb6","block_type":"box","text":"Capacity","page_number":460,"box":{"x":117,"y":134,"width":74,"height":12}},{"id":"ab5f2255-e26b-45df-985c-4401617ca44c","block_type":"box","text":"To be effective and engaged, directors need to have the time and energy to commit to the role. In our","page_number":460,"box":{"x":116,"y":165,"width":757,"height":12}},{"id":"bf088318-fd51-4b19-8f4a-f0b7b87a6d69","block_type":"box","text":"view, an effective board will assess the ability of its members to maintain an appropriate focus on","page_number":460,"box":{"x":116,"y":180,"width":726,"height":12}},{"id":"99739944-e015-405e-a6ce-7d65f5b7416f","block_type":"box","text":"board matters and the company taking into consideration competing responsibilities. We recognize that","page_number":460,"box":{"x":117,"y":196,"width":770,"height":12}},{"id":"1df95947-e032-4271-bdcc-420a8aa3475c","block_type":"box","text":"board leadership roles vary across markets in responsibilities and required time commitment but note","page_number":460,"box":{"x":117,"y":211,"width":756,"height":12}},{"id":"43ae6100-6bbb-493c-895a-cba2893404d4","block_type":"box","text":"that they are generally more intensive than a standard directorship. We will take local norms and","page_number":460,"box":{"x":116,"y":227,"width":721,"height":12}},{"id":"28558d81-f260-425d-b65d-6c9f7501bdf6","block_type":"box","text":"practices into consideration when making our voting determinations across markets.","page_number":460,"box":{"x":117,"y":242,"width":628,"height":12}},{"id":"0b782a65-58c1-45dc-9758-b22718b8fb03","block_type":"box","text":"We may vote against the election of directors who do not seem to have sufficient capacity to effectively","page_number":460,"box":{"x":116,"y":273,"width":769,"height":12}},{"id":"0abe6fa8-2811-421f-99f9-f0e40c705c4d","block_type":"box","text":"fulfil their duties to the board and company.","page_number":460,"box":{"x":116,"y":289,"width":326,"height":12}},{"id":"8b257773-a03a-434f-8590-9ecd27eb1010","block_type":"box","text":"Director elections","page_number":460,"box":{"x":116,"y":320,"width":147,"height":9}},{"id":"7c6c1c89-0def-4ebe-8677-9ebade042929","block_type":"box","text":"Regular election of directors, ideally annually, supports director accountability to shareholders. A","page_number":460,"box":{"x":117,"y":351,"width":720,"height":12}},{"id":"2591f322-235a-461a-bbbb-47d6a5ea8c9e","block_type":"box","text":"classified board structure","page_number":460,"box":{"x":116,"y":366,"width":186,"height":10}},{"id":"e3943c70-aaca-411b-b9fa-9a9ab23c6031","block_type":"box","text":"8","page_number":460,"box":{"x":303,"y":366,"width":5,"height":6}},{"id":"7c2f1e38-0d6c-48be-b781-ef90140ac7e7","block_type":"box","text":"may be justified by a company when it needs consistency and stability","page_number":460,"box":{"x":309,"y":366,"width":530,"height":12}},{"id":"390ecadd-119a-4072-b5f0-d7a54737d62f","block_type":"box","text":"during a time of transition, or on the basis of its business model (e.g., a non-operating company such","page_number":460,"box":{"x":116,"y":382,"width":754,"height":12}},{"id":"de5f0df3-13a2-4df4-8f89-947b5a3ebd56","block_type":"box","text":"as closed-end funds).","page_number":460,"box":{"x":116,"y":397,"width":165,"height":12}},{"id":"d81a171d-2bee-44b8-888e-81d4e08e15b5","block_type":"box","text":"Shareholders should have the opportunity to evaluate nominated directors individually rather than in","page_number":460,"box":{"x":116,"y":428,"width":746,"height":12}},{"id":"c3df9e7c-7aa1-4ebb-bafc-5dc60062313a","block_type":"box","text":"bundled slates. We look to companies to provide sufficient information on each director standing for","page_number":460,"box":{"x":117,"y":444,"width":743,"height":12}},{"id":"b6f00822-0ff6-412b-9eb7-7681078a64c0","block_type":"box","text":"election so that shareholders can assess their capabilities and suitability. We will generally not support","page_number":460,"box":{"x":116,"y":459,"width":765,"height":12}},{"id":"8ad8d0df-6007-43a3-baa1-f50daf672ca8","block_type":"box","text":"the election of directors whose names and biographical details have not been disclosed sufficiently in","page_number":460,"box":{"x":116,"y":475,"width":755,"height":12}},{"id":"f58388e0-66f7-478c-9dff-d1a3f8a7d40b","block_type":"box","text":"advance of the shareholder meeting.","page_number":460,"box":{"x":116,"y":490,"width":278,"height":12}},{"id":"6e31b8a5-499d-4d23-b764-463cc3e1ef2d","block_type":"box","text":"Each director’s appointment should be dependent on receiving a simple majority of the votes cast at","page_number":460,"box":{"x":117,"y":521,"width":746,"height":12}},{"id":"f923b692-dfec-432c-a253-86b35a2a699e","block_type":"box","text":"the shareholder meeting. Where a company’s practices differ, we look to the board to provide a","page_number":460,"box":{"x":116,"y":537,"width":712,"height":12}},{"id":"7a952c98-dffe-4a63-8332-6df693088b3e","block_type":"box","text":"detailed explanation as to how its approach best serves investors’ interests.","page_number":460,"box":{"x":116,"y":552,"width":567,"height":12}},{"id":"1734971c-79b2-414c-b3cc-04d29c092017","block_type":"box","text":"We may vote for shareholder or management proposals seeking to establish annual election of","page_number":460,"box":{"x":116,"y":583,"width":710,"height":12}},{"id":"587e8efa-2a80-4ff7-8ace-7eddb180c8e5","block_type":"box","text":"directors and/or a simple majority vote standard for director elections. We may vote against all the","page_number":460,"box":{"x":116,"y":599,"width":732,"height":12}},{"id":"1be032a7-dd04-42ca-b7d2-d8159a091bef","block_type":"box","text":"directors standing for election as part of a single slate if we have concerns about the profile or","page_number":460,"box":{"x":116,"y":614,"width":701,"height":12}},{"id":"4e2cfeec-266e-443d-a550-78c977509dbe","block_type":"box","text":"performance of an individual director.","page_number":460,"box":{"x":117,"y":630,"width":280,"height":12}},{"id":"ae1e9546-cab4-4b4e-8764-a56f40edb631","block_type":"box","text":"Committees","page_number":460,"box":{"x":117,"y":661,"width":95,"height":9}},{"id":"da91fdd8-3e57-46fc-872d-f100ac9c5147","block_type":"box","text":"Many boards establish committees to focus on specific responsibilities of the board such as audit and","page_number":460,"box":{"x":117,"y":692,"width":751,"height":12}},{"id":"039bcf56-809b-4e80-8b8c-e278685e8171","block_type":"box","text":"risk, governance and human capital, and executive compensation, amongst other matters. We do not","page_number":460,"box":{"x":117,"y":707,"width":751,"height":12}},{"id":"543d2d99-487b-4544-a18a-bdfde27e9cfb","block_type":"box","text":"prescribe to companies what committees they should establish, but we seek to understand the board’s","page_number":460,"box":{"x":117,"y":723,"width":760,"height":12}},{"id":"ec831e67-3fc4-431b-8e3f-3af7c2a0ea29","block_type":"box","text":"rationale for the committee structure it determines is appropriate. We note that, in some markets,","page_number":460,"box":{"x":117,"y":738,"width":717,"height":12}},{"id":"93261fa9-60bd-49f6-929e-e923eae1a905","block_type":"box","text":"regulation requires such committees. The responsibilities of each committee should be clear, and the","page_number":460,"box":{"x":117,"y":754,"width":748,"height":12}},{"id":"e71a9022-e6e7-4d0d-abb6-2995ad7f690c","block_type":"box","text":"board should ensure that all critical matters are assigned either to the full board or to one of the","page_number":460,"box":{"x":117,"y":769,"width":706,"height":12}},{"id":"dc4a35d8-bc21-44ac-974a-666a631e0626","block_type":"box","text":"committees. It is helpful to investor understanding when the board discloses the structure,","page_number":460,"box":{"x":116,"y":785,"width":665,"height":12}},{"id":"bc285395-c0a8-40d2-8bad-ad6a74f6d068","block_type":"box","text":"8","page_number":460,"box":{"x":143,"y":867,"width":4,"height":5}},{"id":"063710b1-3888-4d19-ae56-35fdf2256e5d","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":460,"box":{"x":170,"y":867,"width":673,"height":9}},{"id":"cacb7a33-b022-44da-9d2e-94d68cefca12","block_type":"box","text":"directors stands for election in any one year.","page_number":460,"box":{"x":170,"y":880,"width":262,"height":9}},{"id":"4bf1b142-e562-402e-9ce1-2844eb88c309","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":460,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"2cefe255-4406-4641-bd7f-fceb4975b3d5","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":460,"box":{"x":543,"y":909,"width":325,"height":12}},{"id":"ec948aec-6859-43c2-8552-155f2c014177","block_type":"box","text":"8","page_number":460,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"6e559265-7ee1-4390-81dd-8ea1bea79b53","block_type":"box","text":"NM1026U-6004382-460/605","page_number":460,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"488425d0-b374-4f3d-8735-6d79bcb53d40","block_type":"box","text":"membership, proportion of independent directors, and responsibilities of each committee. The","page_number":461,"box":{"x":117,"y":87,"width":700,"height":12}},{"id":"fc0a90d9-86f4-4a48-b46a-b4c229a2db2f","block_type":"box","text":"responsibilities we typically see assigned to the three most common committees include:","page_number":461,"box":{"x":117,"y":103,"width":662,"height":12}},{"id":"99a4b970-0578-4e85-8fab-deb1debb3bdd","block_type":"box","text":"• Audit and risk – oversight responsibilities for the integrity of financial reporting, risk","page_number":461,"box":{"x":150,"y":134,"width":650,"height":12}},{"id":"4eb971f1-3053-4fdf-9acc-45a4971cdcfa","block_type":"box","text":"management and compliance with legal and regulatory requirements; may also play an","page_number":461,"box":{"x":184,"y":149,"width":650,"height":12}},{"id":"807c9663-ece8-41dc-9bab-bf13e870e07a","block_type":"box","text":"oversight role in relation to the internal audit function and whistleblowing mechanisms.","page_number":461,"box":{"x":184,"y":165,"width":643,"height":12}},{"id":"8652261c-2a55-45d8-a90b-11dc0be3614b","block_type":"box","text":"• Nominating, governance and human capital – oversight responsibilities for corporate","page_number":461,"box":{"x":150,"y":188,"width":664,"height":12}},{"id":"b6df26db-8b8e-4d35-aecf-69adaf169945","block_type":"box","text":"governance principles and practices of the company, including the periodic review of board","page_number":461,"box":{"x":184,"y":203,"width":679,"height":12}},{"id":"36860f7f-7df0-4ea2-9591-3f73d095e037","block_type":"box","text":"performance; responsibility for succession planning for CEO and key board roles, as well as","page_number":461,"box":{"x":184,"y":219,"width":687,"height":12}},{"id":"92ebd683-a085-4f4d-83b4-a07627a41360","block_type":"box","text":"the director appointment process; may also have oversight responsibilities for human capital","page_number":461,"box":{"x":183,"y":234,"width":690,"height":12}},{"id":"dd0afe83-740d-4247-9993-4e937557f2e2","block_type":"box","text":"management strategies, including corporate culture and purpose.","page_number":461,"box":{"x":184,"y":250,"width":489,"height":12}},{"id":"71e8ae4a-109a-4fab-8614-30b26e6013b0","block_type":"box","text":"• Executive compensation – determines the compensation policies and programs for the CEO","page_number":461,"box":{"x":150,"y":273,"width":723,"height":12}},{"id":"b31982d5-5527-4ae0-9c7c-dd6e60c26cb2","block_type":"box","text":"and other executive officers, approves annual awards and payments under the policies; may","page_number":461,"box":{"x":184,"y":289,"width":690,"height":12}},{"id":"44a29df6-ef25-44cc-b401-8efbab4917f1","block_type":"box","text":"also have oversight responsibilities for firm-wide compensation policies.","page_number":461,"box":{"x":184,"y":304,"width":536,"height":12}},{"id":"7416d373-92b7-4454-a3f0-73f8f05ee4a0","block_type":"box","text":"We may vote against the election of the chair of the committee or other directors serving as committee","page_number":461,"box":{"x":116,"y":335,"width":765,"height":12}},{"id":"2cec8e80-ff58-42c0-a817-f0c6b2bede04","block_type":"box","text":"members to convey concerns about how a committee has undertaken its responsibilities. We may vote","page_number":461,"box":{"x":117,"y":351,"width":767,"height":12}},{"id":"95d148c4-528a-4ff3-a124-454eb255ae4c","block_type":"box","text":"against the election of the most senior non-executive director if there is not a clearly disclosed","page_number":461,"box":{"x":116,"y":366,"width":702,"height":12}},{"id":"c6969b5f-d1be-4483-9c15-511151779585","block_type":"box","text":"approach to board committees.","page_number":461,"box":{"x":116,"y":382,"width":236,"height":12}},{"id":"c83200aa-0cea-4ab0-8fd4-09ff48451f0a","block_type":"box","text":"Board and director evaluation","page_number":461,"box":{"x":116,"y":413,"width":243,"height":9}},{"id":"68a98024-f8b4-43c0-9356-20114ee384a3","block_type":"box","text":"We consider it best practice for companies to conduct an annual review of the performance of the","page_number":461,"box":{"x":116,"y":444,"width":729,"height":12}},{"id":"0beae393-5e74-4c09-b87a-a7a820794b2f","block_type":"box","text":"board, the committees, the chair and individual directors. Periodically, this review could be undertaken","page_number":461,"box":{"x":117,"y":459,"width":762,"height":12}},{"id":"e57c9ebd-af5f-4087-959b-9576be8039be","block_type":"box","text":"by an independent third party able to bring objective perspectives to the board on governance and","page_number":461,"box":{"x":117,"y":475,"width":732,"height":12}},{"id":"19a7ec5b-fc73-4732-92cc-20a2534d70f0","block_type":"box","text":"performance. We encourage companies to disclose their approach to and the objectives of","page_number":461,"box":{"x":117,"y":490,"width":677,"height":12}},{"id":"a692fc94-9141-4706-8c5e-b16dad07c5a2","block_type":"box","text":"evaluations, including any changes made to the board’s approach as a result.","page_number":461,"box":{"x":116,"y":506,"width":581,"height":12}},{"id":"967919ba-6751-429a-b4d0-8e2f1895fdc3","block_type":"box","text":"Access to independent advice","page_number":461,"box":{"x":116,"y":537,"width":246,"height":12}},{"id":"9cd770c5-6cb2-4546-9da4-5440e0247a1b","block_type":"box","text":"To support the directors in effectively fulfilling their duties to the company and shareholders, they","page_number":461,"box":{"x":116,"y":568,"width":723,"height":12}},{"id":"2f2fb307-9f90-4785-b4b4-6a42c7238899","block_type":"box","text":"should have access to independent advice. In certain circumstances, it may be helpful to boards to","page_number":461,"box":{"x":116,"y":583,"width":738,"height":12}},{"id":"35ac079b-a26e-483a-85ee-0fc8cf4727cb","block_type":"box","text":"retain independent third parties to advise on critical matters. These might include new industry","page_number":461,"box":{"x":117,"y":599,"width":703,"height":12}},{"id":"127d7a7b-854a-4603-9f4a-6bfb3b74a324","block_type":"box","text":"developments such as emergent and disruptive technology, operating events with material","page_number":461,"box":{"x":116,"y":614,"width":676,"height":12}},{"id":"eeb86a7d-783f-40e5-8e1a-35470ad80b21","block_type":"box","text":"consequences for the company’s reputation and/or performance, or significant transactions. Board","page_number":461,"box":{"x":116,"y":630,"width":735,"height":12}},{"id":"cca16a6c-7cec-47de-85c0-a0fe8d892bbf","block_type":"box","text":"committees may similarly retain third parties to advise them on specialist matters such as audit,","page_number":461,"box":{"x":116,"y":645,"width":713,"height":12}},{"id":"cb8d980a-47ac-4890-9d48-cc452bba8d65","block_type":"box","text":"compensation and succession planning.","page_number":461,"box":{"x":116,"y":661,"width":297,"height":12}},{"id":"6956b5f6-54d3-4f7f-ac1d-fa616f63a43b","block_type":"box","text":"Executive compensation","page_number":461,"box":{"x":402,"y":692,"width":195,"height":12}},{"id":"e1f284e0-883b-4284-bdb5-ec2880cd75f9","block_type":"box","text":"Boards play an important role in establishing compensation arrangements that enable the company to","page_number":461,"box":{"x":117,"y":723,"width":755,"height":12}},{"id":"f58aad0a-5e66-4985-ab99-75b1d1de69aa","block_type":"box","text":"recruit, retain and reward the caliber of executive management necessary to lead and operate the","page_number":461,"box":{"x":117,"y":738,"width":724,"height":12}},{"id":"2bb56c3b-91e9-47ed-8b7d-d9da9de7ca16","block_type":"box","text":"company to deliver superior financial returns over time. We focus on alignment between variable pay","page_number":461,"box":{"x":116,"y":754,"width":748,"height":12}},{"id":"94a65193-6c9e-464e-8f95-5e350921d1aa","block_type":"box","text":"and a company’s financial performance.","page_number":461,"box":{"x":116,"y":769,"width":296,"height":12}},{"id":"1c6e8d9f-ae36-4bfe-beef-1e1a3e111196","block_type":"box","text":"Generally, executive compensation arrangements have four components: base salary, annual bonus","page_number":461,"box":{"x":117,"y":800,"width":746,"height":12}},{"id":"b068956d-ffae-466a-bc0d-195e0586a98b","block_type":"box","text":"that rewards performance against short-term metrics, incentives — most often share-based- that","page_number":461,"box":{"x":116,"y":816,"width":717,"height":12}},{"id":"25e95022-3d9d-4615-b62e-47ae6775b935","block_type":"box","text":"reward performance against long-term metrics, and pensions and benefits. In our observation, base","page_number":461,"box":{"x":117,"y":831,"width":744,"height":12}},{"id":"5695fc17-83d4-4fcf-b867-ba80c607047c","block_type":"box","text":"salary, pensions and benefits are largely set relative to market norms and benchmarks. The annual","page_number":461,"box":{"x":116,"y":847,"width":741,"height":12}},{"id":"17839827-23e7-4eeb-ba1f-9b74dc351290","block_type":"box","text":"bonus and share-based incentive, or variable pay plans, tend to be tailored to the company, its sector","page_number":461,"box":{"x":117,"y":862,"width":757,"height":12}},{"id":"8148c69b-290c-4017-8dc2-b37647246750","block_type":"box","text":"and long-term strategy, as well as the individuals the board is seeking to recruit and motivate.","page_number":461,"box":{"x":116,"y":878,"width":699,"height":12}},{"id":"4e0ebe91-313f-4c8c-9286-77f7eb2c74da","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":461,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"a2fbbca4-4ed0-4047-b7c0-515402e82cfc","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":461,"box":{"x":543,"y":909,"width":325,"height":12}},{"id":"1569592e-2052-4c99-a269-a0755eda4b94","block_type":"box","text":"9","page_number":461,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"ca497d2c-87ac-42c4-a9dc-d3de912609bd","block_type":"box","text":"NM1026U-6004382-461/605","page_number":461,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6a484922-0ad1-474d-be85-0ff9ddb191f0","block_type":"box","text":"Recognizing the unique circumstances of each company, we determine whether to support a","page_number":462,"box":{"x":117,"y":87,"width":693,"height":12}},{"id":"e79f9e98-9b4c-4477-80a5-89751abff887","block_type":"box","text":"company’s approach to executive compensation on a case-by-case basis. We rely on companies","page_number":462,"box":{"x":116,"y":103,"width":726,"height":12}},{"id":"b43bd15e-4fd3-4bd6-87c7-4547f514ac2d","block_type":"box","text":"providing sufficient quantitative and qualitative information in their disclosures to enable shareholders","page_number":462,"box":{"x":117,"y":118,"width":754,"height":12}},{"id":"d02977d5-af13-4218-97fd-497ef885628b","block_type":"box","text":"to understand the compensation arrangements and assess the alignment with investors’ interests.","page_number":462,"box":{"x":116,"y":134,"width":732,"height":12}},{"id":"d135d214-e53e-435c-8ed6-31e40d8d50d8","block_type":"box","text":"Features we look for in compensation arrangements include:","page_number":462,"box":{"x":117,"y":149,"width":454,"height":12}},{"id":"e215505b-bfab-471a-893d-ba826d0f2674","block_type":"box","text":"• Fixed pay components, including base salary, benefits and prerequisites that are appropriate","page_number":462,"box":{"x":150,"y":180,"width":727,"height":12}},{"id":"604d1e49-8125-422e-90c9-f4cc9b7f9d5c","block_type":"box","text":"in the context of the company’s size, sector and market.","page_number":462,"box":{"x":184,"y":196,"width":419,"height":12}},{"id":"211067a6-cde8-43c2-bb7c-30dda37909c4","block_type":"box","text":"• Variable pay subject to performance metrics that are closely linked to the company’s short","page_number":462,"box":{"x":150,"y":219,"width":707,"height":12}},{"id":"400322a7-8bf4-46c8-8f96-9bc6a4ffbf9c","block_type":"box","text":"and long-term strategic objectives.","page_number":462,"box":{"x":184,"y":234,"width":260,"height":12}},{"id":"7373feec-c332-4cdb-abc7-62b47a70f234","block_type":"box","text":"• Long-term incentives that motivate sustained performance across a multi-year period.","page_number":462,"box":{"x":150,"y":258,"width":674,"height":12}},{"id":"7918db28-dd97-4195-97da-8fd83a30479e","block_type":"box","text":"• A balance between fixed and variable pay, short- and long-term incentives, and specific","page_number":462,"box":{"x":150,"y":281,"width":688,"height":12}},{"id":"2ebd5ec6-b0b1-4a84-adb8-e8005a712658","block_type":"box","text":"instruments (cash and equity awards) that promotes pay program durability and seldom","page_number":462,"box":{"x":184,"y":296,"width":654,"height":12}},{"id":"002d56e3-dc48-4495-8bc0-25339beb3672","block_type":"box","text":"necessitates one-off, discretionary payments.","page_number":462,"box":{"x":184,"y":312,"width":342,"height":12}},{"id":"a22ca034-75ca-43db-b9fa-3fe419f21cf7","block_type":"box","text":"• Pay outcomes that are consistent with the returns to investors over the relevant time period.","page_number":462,"box":{"x":150,"y":335,"width":720,"height":12}},{"id":"2f38772a-3f0a-4136-a1fd-9d1243cc24b7","block_type":"box","text":"• Board discretion, if allowed within the variable pay arrangements, to be used sparingly,","page_number":462,"box":{"x":150,"y":358,"width":683,"height":12}},{"id":"c616449d-8ec0-42e7-8275-ddf6ac5b7eeb","block_type":"box","text":"responsibly and transparently.","page_number":462,"box":{"x":184,"y":374,"width":228,"height":12}},{"id":"37b87e5b-f861-421f-8eb6-8cf5f7603e3b","block_type":"box","text":"• A requirement, that participants in long-term share-based incentive plans build a meaningful","page_number":462,"box":{"x":150,"y":397,"width":721,"height":12}},{"id":"5ab15445-3f1b-4264-aed5-2070317da9ac","block_type":"box","text":"shareholding in the company within a defined time period, as determined by the board or","page_number":462,"box":{"x":184,"y":413,"width":662,"height":12}},{"id":"0a0fa8c3-1f81-4498-ae28-c51836500ffb","block_type":"box","text":"relevant board committee.","page_number":462,"box":{"x":184,"y":428,"width":198,"height":10}},{"id":"39cc9533-19ab-4460-8dde-bd9bb0efae72","block_type":"box","text":"• Change of control provisions that appropriately balance the interests of executives and","page_number":462,"box":{"x":150,"y":451,"width":681,"height":12}},{"id":"01a9f1a3-71d0-49c2-80f7-355cd8c95f19","block_type":"box","text":"shareholders.","page_number":462,"box":{"x":184,"y":467,"width":106,"height":9}},{"id":"2ce8ffb2-5ea1-4a11-938c-5544ce6b4eaa","block_type":"box","text":"• Clawback or malus provisions that allow the company to recoup or hold back variable","page_number":462,"box":{"x":150,"y":490,"width":672,"height":12}},{"id":"1cee98f1-ac0e-4d23-94c8-4abcc4290589","block_type":"box","text":"compensation from individuals whose awards were based on fraudulent activities, misstated","page_number":462,"box":{"x":184,"y":506,"width":687,"height":12}},{"id":"1267544a-65d4-495d-ae6f-ed59b77a0740","block_type":"box","text":"financial reports, or executive misconduct.","page_number":462,"box":{"x":183,"y":521,"width":318,"height":12}},{"id":"ee4fc536-4f18-4e35-88c4-654bf50081bd","block_type":"box","text":"• Severance arrangements that protect the company’s interests but do not cost more than is","page_number":462,"box":{"x":150,"y":544,"width":710,"height":12}},{"id":"8201b38b-1d1c-418f-8635-0a98fd34a0ff","block_type":"box","text":"contractual.","page_number":462,"box":{"x":184,"y":560,"width":91,"height":9}},{"id":"7829fddf-0531-4237-a1b6-9d9968fd3fcc","block_type":"box","text":"We may vote against proposals to introduce new share-based incentives, approve existing policies or","page_number":462,"box":{"x":116,"y":591,"width":757,"height":12}},{"id":"e56666f4-5503-4b2d-aca3-d5dcd58c8f7d","block_type":"box","text":"plans, or approve the compensation report where we do not see alignment between executive","page_number":462,"box":{"x":117,"y":607,"width":701,"height":11}},{"id":"149284fb-8e76-477f-9430-c2a883b7396c","block_type":"box","text":"compensation arrangements and our clients’ financial interests. When there is not an alternative, or","page_number":462,"box":{"x":116,"y":622,"width":742,"height":12}},{"id":"33f31372-40ea-4462-a755-1764cea529d3","block_type":"box","text":"where there have been multi-year issues with compensation misaligned with performance, we may","page_number":462,"box":{"x":116,"y":637,"width":738,"height":12}},{"id":"510d71f5-7776-47dd-ae3f-8ea63da4ad49","block_type":"box","text":"vote against the election of the chair of the responsible committee, or the most senior independent","page_number":462,"box":{"x":116,"y":653,"width":735,"height":12}},{"id":"746b8554-444b-413e-b637-45fc9e517e56","block_type":"box","text":"director.","page_number":462,"box":{"x":116,"y":669,"width":59,"height":9}},{"id":"379fdac3-13fd-4c77-9110-5d85fa00c011","block_type":"box","text":"Non-executive director compensation","page_number":462,"box":{"x":350,"y":700,"width":299,"height":11}},{"id":"41216113-3b1c-4f25-b5ca-691dac89f22a","block_type":"box","text":"Companies generally pay non-executive directors an annual retainer or fee in cash, shares or a","page_number":462,"box":{"x":117,"y":730,"width":706,"height":13}},{"id":"f80da652-8c48-47be-bf7f-64782e246215","block_type":"box","text":"combination of the two. Some companies also pay additional fees for service on board committees or","page_number":462,"box":{"x":116,"y":746,"width":752,"height":12}},{"id":"8db5f56c-7fd1-4c2c-9f8d-ec9c9beeaa53","block_type":"box","text":"in board leadership roles. We do not support non-executive directors participating in performance","page_number":462,"box":{"x":117,"y":761,"width":726,"height":13}},{"id":"2944a3c2-29e7-4cbe-a72f-c067b96a6029","block_type":"box","text":"based incentive plans as doing so may create a conflict of interest and undermine their independence","page_number":462,"box":{"x":117,"y":777,"width":753,"height":12}},{"id":"fa85bb08-18c5-4d02-9cfa-564bc78d0c94","block_type":"box","text":"from management, whom they oversee.","page_number":462,"box":{"x":116,"y":792,"width":295,"height":13}},{"id":"c1f26d04-da0a-4b71-ae6e-3ab0d4062ed4","block_type":"box","text":"Capital structure","page_number":462,"box":{"x":433,"y":823,"width":133,"height":12}},{"id":"00a2d987-9ab6-4de1-9544-7f2dbf7bedeb","block_type":"box","text":"Boards are responsible for ensuring senior executive leadership has established a capital strategy that","page_number":462,"box":{"x":117,"y":854,"width":765,"height":13}},{"id":"9ac0dbcf-b125-47f6-9a63-254435713021","block_type":"box","text":"achieves appropriate capital allocation in support of long-term financial resilience.","page_number":462,"box":{"x":116,"y":870,"width":610,"height":12}},{"id":"dc50cecb-25ea-4a41-910d-45fabfbe1a04","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":462,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"6f04ca2c-9824-4980-ab42-06d21907d298","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":462,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"e155f35e-879a-4432-9ec8-e35049b48a4d","block_type":"box","text":"10","page_number":462,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"94a77929-c796-4957-9ff2-187a10dc17fd","block_type":"box","text":"NM1026U-6004382-462/605","page_number":462,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a25e87df-f601-4c1f-8768-c2bb0dd3932b","block_type":"box","text":"Where company practices diverge from those set out below, we look for companies to disclose why","page_number":463,"box":{"x":116,"y":87,"width":743,"height":12}},{"id":"f4197463-d093-47c4-8941-a9a68b896c8d","block_type":"box","text":"they view these practices to be aligned with shareholders’ interests. We may vote against management","page_number":463,"box":{"x":116,"y":103,"width":772,"height":12}},{"id":"cd46ea51-7631-4bb3-aa92-47234cf5d8fc","block_type":"box","text":"proposals seeking capital-related authorities, or the election of the most senior independent director, if","page_number":463,"box":{"x":117,"y":118,"width":761,"height":12}},{"id":"69bace69-c16a-46c7-980f-6999213b4846","block_type":"box","text":"we have concerns about a company’s approach. We may also support a shareholder proposal seeking","page_number":463,"box":{"x":116,"y":134,"width":768,"height":12}},{"id":"794039a2-2452-47e1-ba8b-36ee85b00fd5","block_type":"box","text":"conversion of shares with differentiated voting rights to a one-share, one-vote standard.","page_number":463,"box":{"x":116,"y":149,"width":655,"height":12}},{"id":"bc0388c2-2de7-4898-af24-7940efada376","block_type":"box","text":"Share","page_number":463,"box":{"x":116,"y":180,"width":46,"height":10}},{"id":"6f48e433-bc31-443f-a450-c9ac4838623d","block_type":"box","text":"issuance","page_number":463,"box":{"x":168,"y":180,"width":76,"height":10}},{"id":"64997edc-b43b-4e5f-9c4d-0b607b4622de","block_type":"box","text":"We assess requests for share issuance for particular transactions on a case-by-case basis. We will","page_number":463,"box":{"x":116,"y":211,"width":741,"height":12}},{"id":"023eef16-96a6-4790-aeac-a03687b94711","block_type":"box","text":"generally support authorities to issue shares when subject to pre-emptive rights, and up to 20% absent","page_number":463,"box":{"x":116,"y":227,"width":768,"height":12}},{"id":"5a2283ac-906d-4e91-94b9-c0f695634536","block_type":"box","text":"pre-emptive rights. We consider it good practice for companies to seek regular approval of these","page_number":463,"box":{"x":117,"y":242,"width":720,"height":12}},{"id":"f9e38f26-cc39-4d1b-a49f-55302da9096b","block_type":"box","text":"authorities to allow shareholders to take into consideration how prior authorities were used, as well as","page_number":463,"box":{"x":116,"y":258,"width":759,"height":11}},{"id":"ef18c6b8-21eb-4a30-b514-96e9f46cdc8a","block_type":"box","text":"the current circumstances of the company and the market environment.","page_number":463,"box":{"x":116,"y":273,"width":536,"height":12}},{"id":"75f57966-8b4f-4d76-936b-0a0ec7cfb639","block_type":"box","text":"Share buybacks","page_number":463,"box":{"x":116,"y":304,"width":133,"height":12}},{"id":"fe1f5176-f490-44d0-9277-00e7ac00dcc8","block_type":"box","text":"We assess share buyback proposals in the context of the company’s disclosed capital management","page_number":463,"box":{"x":116,"y":335,"width":746,"height":12}},{"id":"2cb40736-f7d2-4578-b9d5-94bb836bbe94","block_type":"box","text":"strategy and management’s determination of the appropriate balance between investment that","page_number":463,"box":{"x":116,"y":351,"width":706,"height":12}},{"id":"40ec4279-5603-4ba7-ae52-54d0ef4d8b96","block_type":"box","text":"supports the long-term growth of the company and returning cash to investors. We also take into","page_number":463,"box":{"x":116,"y":366,"width":721,"height":12}},{"id":"35cc63c1-22e0-4cf1-9bd1-b4da04539cd4","block_type":"box","text":"consideration the effect of a buyback program on the company’s balance sheet and executive","page_number":463,"box":{"x":116,"y":382,"width":701,"height":12}},{"id":"10c7100e-dd92-455d-a972-af3f6d33fcc2","block_type":"box","text":"compensation arrangements and the price at which shares are repurchased relative to market price.","page_number":463,"box":{"x":116,"y":397,"width":748,"height":12}},{"id":"0996de5b-0a74-4111-9b97-ce6abef2f290","block_type":"box","text":"We consider it good practice for companies to seek regular approval of these authorities to allow","page_number":463,"box":{"x":116,"y":413,"width":721,"height":12}},{"id":"6fe04456-b928-48f4-848d-a2fa0d35618b","block_type":"box","text":"shareholders to take into consideration how prior authorities were used, as well as the current","page_number":463,"box":{"x":116,"y":428,"width":700,"height":12}},{"id":"7db3db8d-a035-43bc-9f54-ef5352239ec2","block_type":"box","text":"circumstances of the company and the market environment.","page_number":463,"box":{"x":116,"y":444,"width":451,"height":12}},{"id":"f7b6920a-ccab-4d8b-bb3a-4b1c35dd6e0a","block_type":"box","text":"Dividends","page_number":463,"box":{"x":117,"y":475,"width":84,"height":9}},{"id":"1a2947d6-7fb0-4bfd-b4cc-2d3a4d78aeca","block_type":"box","text":"We generally defer to management and the board on dividend policy but may engage to seek further","page_number":463,"box":{"x":116,"y":506,"width":752,"height":12}},{"id":"e831b761-568d-4d99-b5a5-8b2c72edec51","block_type":"box","text":"clarification where a proposed dividend appears out of line with the company’s financial position.","page_number":463,"box":{"x":116,"y":521,"width":720,"height":12}},{"id":"4c8ac351-e7fd-4126-b201-89820f793c14","block_type":"box","text":"Differentiated voting rights","page_number":463,"box":{"x":117,"y":552,"width":219,"height":12}},{"id":"8e821c35-1458-4ea1-881f-bd933f7e1c2f","block_type":"box","text":"We prefer companies to adopt a one-share, one-vote structure for share classes with the same","page_number":463,"box":{"x":116,"y":583,"width":710,"height":12}},{"id":"bf6671ba-2a4c-4493-b3c4-7fd9c0327d60","block_type":"box","text":"economic exposure. Certain companies, particularly those new to public markets, could make the case","page_number":463,"box":{"x":116,"y":599,"width":768,"height":12}},{"id":"173da7b0-2ad2-4f3e-ac4f-2647981acbc9","block_type":"box","text":"to adopt a differentiated voting rights structure, or dual class stock. In those situations, we encourage","page_number":463,"box":{"x":116,"y":614,"width":755,"height":12}},{"id":"75c9cee4-de96-4ac0-9b4f-ab146b4aef51","block_type":"box","text":"companies to evaluate and seek approval for their capital structure on a periodic basis.","page_number":463,"box":{"x":116,"y":630,"width":650,"height":12}},{"id":"e86ce494-04b2-4e0d-9e68-64f462e1c416","block_type":"box","text":"Transactions and special situations","page_number":463,"box":{"x":357,"y":661,"width":285,"height":12}},{"id":"a3a573a7-4df2-4175-a2a0-8c01a5f82946","block_type":"box","text":"We monitor developments in transactions and special situations closely and undertake our own","page_number":463,"box":{"x":116,"y":692,"width":706,"height":12}},{"id":"adf59012-5a31-4923-a2d0-2b3ce5bc5fcc","block_type":"box","text":"detailed analyses of proposals.","page_number":463,"box":{"x":116,"y":707,"width":229,"height":12}},{"id":"82943e0d-7764-4f46-b48b-3b05cbd6d9fd","block_type":"box","text":"Mergers and acquisitions","page_number":463,"box":{"x":117,"y":738,"width":201,"height":12}},{"id":"fbc7c3b3-3b0c-4295-81ac-6049b1ea479e","block_type":"box","text":"We evaluate proposed mergers or acquisitions by assessing the financial outcome for our clients as","page_number":463,"box":{"x":116,"y":769,"width":740,"height":12}},{"id":"0020236e-d8ea-42bf-9c58-f25686d3788f","block_type":"box","text":"minority shareholders. Management should provide an assessment of the proposed transaction’s","page_number":463,"box":{"x":117,"y":785,"width":719,"height":12}},{"id":"411e91af-b651-4553-af9b-a3dad214b482","block_type":"box","text":"strategic and financial rationale, along with its execution and operational risks. We review each","page_number":463,"box":{"x":116,"y":800,"width":703,"height":12}},{"id":"c627f2e7-88f2-46c3-8439-53e79c422227","block_type":"box","text":"transaction independently based on these factors and the degree to which the transaction enhances","page_number":463,"box":{"x":116,"y":816,"width":743,"height":12}},{"id":"631f19c3-5eb1-4ace-86ad-ca60e18299dd","block_type":"box","text":"shareholder value. The board might consider establishing an ad hoc transaction committee to","page_number":463,"box":{"x":116,"y":831,"width":699,"height":12}},{"id":"4b29f007-c366-40d5-933d-57eb3160b80a","block_type":"box","text":"undertake an independent assessment of a significant merger or acquisition, in advance of making its","page_number":463,"box":{"x":117,"y":847,"width":757,"height":12}},{"id":"22223ae2-54a6-4497-9a5e-3c6218374f81","block_type":"box","text":"recommendation to shareholders.","page_number":463,"box":{"x":117,"y":862,"width":254,"height":10}},{"id":"394b1607-7874-4855-94ac-c2be4b8c6776","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":463,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"49d5d9ee-45a0-42e7-9d8e-b26c04cacb6f","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":463,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"770706dc-3b30-4612-84fa-3736fdaeda05","block_type":"box","text":"11","page_number":463,"box":{"x":866,"y":909,"width":15,"height":9}},{"id":"adfdb4e1-7944-4157-b03b-f724dff820ac","block_type":"box","text":"NM1026U-6004382-463/605","page_number":463,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"0f04e267-1c9e-4861-9e1d-e36e0b9bd13a","block_type":"box","text":"We will vote against transactions that, in our assessment, do not advance our clients’ financial","page_number":464,"box":{"x":116,"y":87,"width":703,"height":12}},{"id":"6ed8dcf8-b64c-4512-a118-b484aebe54f1","block_type":"box","text":"interests.","page_number":464,"box":{"x":117,"y":103,"width":72,"height":9}},{"id":"ff64dd1d-f799-46c8-bb21-65e0bff8f893","block_type":"box","text":"Anti-takeover defenses","page_number":464,"box":{"x":116,"y":134,"width":190,"height":9}},{"id":"3a2ca7db-90f9-4fd5-9124-7051d8a0f762","block_type":"box","text":"In principle, we do not support companies using anti-takeover defenses, also known as poison pills or","page_number":464,"box":{"x":117,"y":165,"width":757,"height":12}},{"id":"7b7922d6-ed98-45c1-b61f-84bdfb1febef","block_type":"box","text":"shareholder rights plans, as they can entrench management and boards which have not delivered","page_number":464,"box":{"x":116,"y":180,"width":731,"height":12}},{"id":"12603b3e-55ae-42e3-84c2-b81b1b7eaa46","block_type":"box","text":"long-term shareholder value. By exception, a poison pill may be supported if its purpose is to delay a","page_number":464,"box":{"x":117,"y":196,"width":751,"height":12}},{"id":"4150dfbf-e9bf-46a5-b623-0cdcac4cf4fa","block_type":"box","text":"takeover that is considered sub-optimal and enable management to seek an improved offer. Similarly,","page_number":464,"box":{"x":116,"y":211,"width":761,"height":12}},{"id":"23af24de-11a2-44af-9d71-343915548eb1","block_type":"box","text":"management could make the case to use a poison pill to block a shareholder activism campaign that","page_number":464,"box":{"x":117,"y":227,"width":751,"height":12}},{"id":"9e09b6ee-638e-4e19-a8a9-2fafcccc0e13","block_type":"box","text":"may be counter to the interests of other investors. Defense mechanisms introduced in these","page_number":464,"box":{"x":117,"y":242,"width":687,"height":12}},{"id":"cf3c295a-f01c-4cce-aec0-719c649007d0","block_type":"box","text":"circumstances should be limited in term and threshold, and also be closely monitored by the","page_number":464,"box":{"x":116,"y":258,"width":688,"height":12}},{"id":"6d7486ae-dbae-4c29-a0cb-18ecc04aee15","block_type":"box","text":"independent members of the board. We consider it good practice for companies to put to a shareholder","page_number":464,"box":{"x":117,"y":273,"width":771,"height":12}},{"id":"f0f1d337-28ec-43cd-875f-fd144e6dc7a0","block_type":"box","text":"vote any mechanisms expected to be in place for more than 12 months.","page_number":464,"box":{"x":116,"y":289,"width":538,"height":12}},{"id":"d8069731-4d8e-4479-af4e-0601b69c5980","block_type":"box","text":"Shareholder activism","page_number":464,"box":{"x":116,"y":320,"width":175,"height":9}},{"id":"8f6fdee0-f3a7-45c3-a59a-5966e3ba1865","block_type":"box","text":"When companies are the focus of an activism campaign, we may communicate with the activist to","page_number":464,"box":{"x":116,"y":351,"width":732,"height":12}},{"id":"d0efb9f1-98aa-465b-9206-4e92fd0b360e","block_type":"box","text":"understand their analysis and objectives, once they have publicly disclosed their campaign. We may","page_number":464,"box":{"x":117,"y":366,"width":748,"height":12}},{"id":"d5f26312-4d9c-4bd3-be79-f50f37b4976a","block_type":"box","text":"also engage with company management and possibly board members, especially those the activist","page_number":464,"box":{"x":116,"y":382,"width":741,"height":12}},{"id":"62ac6909-0a23-4479-a309-0cd7dbebe9c6","block_type":"box","text":"may be seeking to replace. In our assessment, we evaluate various factors, including the concerns","page_number":464,"box":{"x":117,"y":397,"width":737,"height":12}},{"id":"f53e292d-351c-443e-84c6-5af1169b47f6","block_type":"box","text":"raised by the activist and the case for change; the quality of both the activist’s and management’s","page_number":464,"box":{"x":117,"y":413,"width":728,"height":12}},{"id":"4be863c6-a0fa-4b02-afc4-36243d723eff","block_type":"box","text":"plans; and the qualifications of each party’s candidates. We evaluate each contested situation by","page_number":464,"box":{"x":117,"y":428,"width":723,"height":12}},{"id":"e47f0d6e-e610-4fed-aa94-ba99b3a2beb1","block_type":"box","text":"assessing the potential financial outcome for our clients as minority shareholders.","page_number":464,"box":{"x":116,"y":444,"width":610,"height":12}},{"id":"1c1dc96c-dfd7-4e46-a9f2-08d5178b3fc6","block_type":"box","text":"We may support board candidates nominated by a shareholder activist if BAIS, in its independent","page_number":464,"box":{"x":116,"y":475,"width":728,"height":12}},{"id":"2e7f68e3-c12c-43a7-b137-0926748eda2a","block_type":"box","text":"judgment, or the relevant portfolio manager has determined that there is a case for change to enhance","page_number":464,"box":{"x":115,"y":490,"width":767,"height":12}},{"id":"a7ba670e-8cdd-4147-af68-7d19f4d33e97","block_type":"box","text":"shareholder value, or if the incumbent board members do not demonstrate the relevant skills and","page_number":464,"box":{"x":116,"y":506,"width":725,"height":11}},{"id":"b2acaf7d-6aaa-4d13-a1b3-ca4c2e191e4a","block_type":"box","text":"expertise or have a poor track record of protecting shareholders’ interests.","page_number":464,"box":{"x":116,"y":521,"width":556,"height":12}},{"id":"2c7cc257-7fa7-463d-9514-a6f384da1af3","block_type":"box","text":"Significant shareholders and related party transactions","page_number":464,"box":{"x":116,"y":552,"width":446,"height":12}},{"id":"4359f61a-60a4-4ccb-91a7-82e29bc86349","block_type":"box","text":"Boards of companies with affiliated shareholders or directors should give equitable consideration to the","page_number":464,"box":{"x":117,"y":583,"width":768,"height":12}},{"id":"3b3d5620-a7d8-4257-b5ee-9d3601e6f7d4","block_type":"box","text":"interests of all shareholders when evaluating related party transactions.","page_number":464,"box":{"x":117,"y":599,"width":534,"height":12}},{"id":"13f2c3ca-2f15-4924-ba31-98f688a6f82a","block_type":"box","text":"We consider it good practice for transactions with related parties, such as significant shareholders or","page_number":464,"box":{"x":116,"y":630,"width":751,"height":12}},{"id":"2d883be1-a23f-4bef-b923-03329c7f6a4c","block_type":"box","text":"companies affiliated with the public company, to be disclosed in detail and conducted on terms similar","page_number":464,"box":{"x":116,"y":645,"width":760,"height":12}},{"id":"9dd0a279-ced8-451a-9a3b-9c65ffed1497","block_type":"box","text":"to what would objectively have been agreed with a non-related party. In our view, such transactions","page_number":464,"box":{"x":116,"y":661,"width":737,"height":12}},{"id":"37ee0189-cbf1-4429-9446-4d525990a28b","block_type":"box","text":"should be reviewed and approved by the independent members of the board, and if voted on, only","page_number":464,"box":{"x":116,"y":676,"width":729,"height":12}},{"id":"a436de8c-ac44-4344-b2f3-0acc6d1aa644","block_type":"box","text":"disinterested shareholders should vote.","page_number":464,"box":{"x":116,"y":692,"width":291,"height":9}},{"id":"5f81cc0d-a032-4b0b-a427-e541ce495e33","block_type":"box","text":"Corporate reporting, risk management and audit","page_number":464,"box":{"x":307,"y":723,"width":385,"height":12}},{"id":"58d057a4-b792-4534-85d9-6853e7675dd1","block_type":"box","text":"Investors depend on corporate reporting, both regulatory and voluntary, to understand a company’s","page_number":464,"box":{"x":117,"y":754,"width":737,"height":12}},{"id":"c39fae7b-ef54-4836-acc0-24822b13998b","block_type":"box","text":"strategy, its implementation and financial performance, as well as to assess the quality of management","page_number":464,"box":{"x":116,"y":769,"width":765,"height":12}},{"id":"b6aa28ae-87f3-4896-a78e-76a0c8338063","block_type":"box","text":"and operations and potential for the company to create shareholder value over time. We consider it","page_number":464,"box":{"x":116,"y":785,"width":736,"height":12}},{"id":"da091202-0046-4451-9edd-57dbd2bd0ae7","block_type":"box","text":"good practice for the board to oversee corporate reporting and the policies and procedures","page_number":464,"box":{"x":116,"y":800,"width":674,"height":12}},{"id":"b20d12a9-9fac-4be1-99f5-b589b07a7886","block_type":"box","text":"underpinning the internal audit function and external audit.","page_number":464,"box":{"x":117,"y":816,"width":430,"height":12}},{"id":"b3bddfdf-8430-4fea-a716-19bc3bb13191","block_type":"box","text":"A company’s financial reporting should provide decision-useful information for investors, and other","page_number":464,"box":{"x":116,"y":847,"width":734,"height":12}},{"id":"1325fd0e-8cd2-424d-b05e-9ffe03580d34","block_type":"box","text":"stakeholders, on its financial performance and position. It should provide an accurate and balanced","page_number":464,"box":{"x":116,"y":862,"width":742,"height":12}},{"id":"0470d276-1a9b-4591-85be-f5d84a2ff69e","block_type":"box","text":"assessment of the risks and opportunities the company faces in realizing its long-term strategy.","page_number":464,"box":{"x":116,"y":878,"width":712,"height":12}},{"id":"8de6e5b0-410f-488b-86b0-12e6e73b7680","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":464,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"64aaf484-356b-43d6-b952-e558675e8533","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":464,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"0beec081-9b0b-4ebe-9d2d-4cdb3fde43e7","block_type":"box","text":"12","page_number":464,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"493c51c0-cc0b-472c-83bb-718af8d6887f","block_type":"box","text":"NM1026U-6004382-464/605","page_number":464,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9b5c82d2-d516-4d7a-8d92-1aab81681bba","block_type":"box","text":"Accordingly, the assumptions made by management and reviewed by the auditor in preparing the","page_number":465,"box":{"x":116,"y":87,"width":729,"height":12}},{"id":"e9b94856-5156-4aeb-8069-80933dd3c41d","block_type":"box","text":"financial statements should be reasonable and justified. Financial statements should be prepared in","page_number":465,"box":{"x":116,"y":102,"width":744,"height":13}},{"id":"1d2db088-21b2-4565-8c7c-ee034a8a5a76","block_type":"box","text":"accordance with globally developed reporting standards and any divergence from generally accepted","page_number":465,"box":{"x":116,"y":118,"width":755,"height":12}},{"id":"ff65a62f-91c9-4a01-b428-934f5043cec4","block_type":"box","text":"accounting principles should be explained in detail and justified. Accounting restatements should be","page_number":465,"box":{"x":116,"y":134,"width":745,"height":12}},{"id":"ccccf3e8-070f-45f6-ac9c-0f04b089784e","block_type":"box","text":"explained in detail and any remedial actions, and the implications of these, disclosed.","page_number":465,"box":{"x":116,"y":149,"width":638,"height":12}},{"id":"9c5cd413-11e9-447f-84c2-6c85158c478f","block_type":"box","text":"In this context, audit committees play a vital role in a company’s financial reporting system by providing","page_number":465,"box":{"x":117,"y":180,"width":769,"height":12}},{"id":"0975bc86-889b-4ac0-abc3-2ded8554edc1","block_type":"box","text":"independent oversight of the accounts, material financial and, where appropriate to the jurisdiction,","page_number":465,"box":{"x":117,"y":196,"width":737,"height":12}},{"id":"1dc0f2a9-3157-4aa7-b68e-65045358173f","block_type":"box","text":"non-financial information, internal control frameworks and Enterprise Risk Management systems. In","page_number":465,"box":{"x":117,"y":211,"width":743,"height":12}},{"id":"a0656cad-ec9f-4510-a4df-cd387c8e284a","block_type":"box","text":"our view, effective audit committee oversight strengthens the quality and reliability of a company’s","page_number":465,"box":{"x":116,"y":227,"width":730,"height":12}},{"id":"7db281a1-4c1a-400b-ad22-3941f3027a77","block_type":"box","text":"financial statements and provides an important level of reassurance to shareholders. Audit committees","page_number":465,"box":{"x":116,"y":242,"width":767,"height":12}},{"id":"c7851a49-fec3-452b-bd78-7c8eb23ce0f0","block_type":"box","text":"should have a procedure in place for assessing the independence of the auditor and the quality of the","page_number":465,"box":{"x":116,"y":258,"width":758,"height":12}},{"id":"b9821741-0ae4-4c2f-9411-e5b135c06eee","block_type":"box","text":"external audit process annually.","page_number":465,"box":{"x":116,"y":273,"width":241,"height":12}},{"id":"1363a19d-7f83-447c-b47b-0ea4d7f3ffc9","block_type":"box","text":"Similarly, we encourage companies to disclose material sustainability-related factors that are integral to","page_number":465,"box":{"x":116,"y":304,"width":771,"height":12}},{"id":"fb37403d-47b8-44d2-a47d-39833859db45","block_type":"box","text":"how a company manages risks or generates revenue. BAIS finds it helpful to our understanding when","page_number":465,"box":{"x":117,"y":320,"width":758,"height":12}},{"id":"1ac619ce-13a5-4966-bb86-362ceb901aa5","block_type":"box","text":"companies provide robust, standardized disclosures on their material sustainability-related risks and","page_number":465,"box":{"x":116,"y":335,"width":747,"height":12}},{"id":"05ee4319-9f76-46d7-a8f6-7f8f4a27b70e","block_type":"box","text":"opportunities. The International Sustainability Standards Board (ISSB) is one entity working to meet","page_number":465,"box":{"x":116,"y":351,"width":743,"height":12}},{"id":"3e15a941-73ef-4ebf-ad0a-af90caf6f3b5","block_type":"box","text":"these objectives through its reporting standards, which may be helpful to companies in preparing such","page_number":465,"box":{"x":116,"y":366,"width":763,"height":12}},{"id":"831982c1-9a1f-4c45-bf0b-e0136946c11d","block_type":"box","text":"reports.","page_number":465,"box":{"x":117,"y":382,"width":54,"height":12}},{"id":"b468492c-c9a6-454d-9a36-9aa2b3168829","block_type":"box","text":"9","page_number":465,"box":{"x":173,"y":382,"width":5,"height":6}},{"id":"00e29134-aabd-448e-9275-a74be6f041dc","block_type":"box","text":"However, we do not mandate any specific disclosure framework, and note that companies in","page_number":465,"box":{"x":179,"y":382,"width":696,"height":12}},{"id":"064e48df-94d4-4ed4-bb44-a6cde6419517","block_type":"box","text":"certain jurisdictions are subject to mandatory reporting requirements under standards specified by","page_number":465,"box":{"x":116,"y":397,"width":731,"height":12}},{"id":"8c4fea13-58c2-4926-9fb8-bb23bb6eabc6","block_type":"box","text":"policy makers.","page_number":465,"box":{"x":117,"y":413,"width":105,"height":12}},{"id":"20b8ae71-be81-45a6-81b4-0f1f2a5cd257","block_type":"box","text":"10","page_number":465,"box":{"x":224,"y":413,"width":11,"height":6}},{"id":"926672da-81fc-46e1-958a-d3e54c9dff34","block_type":"box","text":"Companies should establish robust risk management and internal control processes appropriate to the","page_number":465,"box":{"x":117,"y":444,"width":765,"height":12}},{"id":"1e3bd821-8d68-4df6-afeb-9aa9423cc586","block_type":"box","text":"company’s business, risk tolerance, and regulatory environment. A credible whistleblowing system for","page_number":465,"box":{"x":116,"y":459,"width":759,"height":12}},{"id":"ddc87649-b2a6-456a-8684-673d70308559","block_type":"box","text":"employees, and potentially other stakeholders, can be a useful mechanism for ensuring that senior","page_number":465,"box":{"x":116,"y":475,"width":738,"height":12}},{"id":"213dbc72-77c8-44b2-a1d5-3de147c060a3","block_type":"box","text":"management and the board are aware of potential misconduct or breaches in risk management and","page_number":465,"box":{"x":117,"y":490,"width":745,"height":12}},{"id":"ef117fdd-e785-4906-a15e-263d01eba858","block_type":"box","text":"internal control processes.","page_number":465,"box":{"x":117,"y":506,"width":200,"height":12}},{"id":"f49390b5-e023-4571-b573-12c706d1531c","block_type":"box","text":"A comprehensive audit conducted by an independent audit firm contributes to investor confidence in","page_number":465,"box":{"x":116,"y":537,"width":748,"height":12}},{"id":"bc5d831a-2422-4ce7-befd-9a8f56b4b644","block_type":"box","text":"the quality of corporate reporting. It is helpful when the audit report gives some insight into the scope","page_number":465,"box":{"x":116,"y":552,"width":752,"height":12}},{"id":"83c5c538-5f98-4a8f-ab2e-061dd80f9ae0","block_type":"box","text":"and focus of the audit, as well as any critical audit matters identified and how these were resolved. A","page_number":465,"box":{"x":116,"y":568,"width":751,"height":12}},{"id":"3554cf78-4354-4ffb-b776-034f6b9e225d","block_type":"box","text":"comprehensive and effective audit is time and resource intensive, and the audit fee should be","page_number":465,"box":{"x":116,"y":583,"width":700,"height":12}},{"id":"b37d5f7c-4062-4288-b49f-34c8a20e8382","block_type":"box","text":"commensurate. Fees paid to the audit firm for non-audit consulting should not exceed the audit fee to a","page_number":465,"box":{"x":116,"y":599,"width":771,"height":12}},{"id":"7bd0484f-feaf-4fa0-908e-875f637aad57","block_type":"box","text":"degree that may prompt concerns about the independence of the audit. The audit committee should","page_number":465,"box":{"x":116,"y":614,"width":746,"height":12}},{"id":"3044537a-19e8-4074-b756-16b149b1342c","block_type":"box","text":"explain its position on auditor tenure and how it confirmed that the auditor remained independent.","page_number":465,"box":{"x":116,"y":630,"width":728,"height":12}},{"id":"6ea4d583-7006-4043-bd4f-c75a6eae4e82","block_type":"box","text":"We may vote against the election of the responsible directors if corporate reporting is insufficient or","page_number":465,"box":{"x":116,"y":661,"width":735,"height":12}},{"id":"7bc18d11-e2f5-4eee-a45f-74a31f30877b","block_type":"box","text":"there are material misstatements in financial reports. In markets where relevant, we may vote against a","page_number":465,"box":{"x":116,"y":676,"width":766,"height":12}},{"id":"2b15d5ba-1729-437a-af81-add9bade119e","block_type":"box","text":"proposal to approve the financial statements or the discharge of the board when we are concerned","page_number":465,"box":{"x":117,"y":692,"width":731,"height":12}},{"id":"dd133bbb-e7c1-488a-b87b-99bde47433ca","block_type":"box","text":"about the quality of corporate reporting or the audit. We may vote against proposals to appoint the","page_number":465,"box":{"x":116,"y":707,"width":728,"height":12}},{"id":"96d62371-b648-48ef-bd01-da7ec2bc99c5","block_type":"box","text":"auditor, ratify the audit report, or approve the audit fee if we are concerned about the auditor’s","page_number":465,"box":{"x":116,"y":723,"width":697,"height":12}},{"id":"1515b1cf-db5e-45cc-8f77-11b27c4f594f","block_type":"box","text":"independence, the quality of the audit, or there are material misstatements in financial reports and the","page_number":465,"box":{"x":117,"y":738,"width":754,"height":12}},{"id":"ab43924c-4a3e-4863-8d85-d02acff60ccd","block_type":"box","text":"board has not established reasonable remediation plans.","page_number":465,"box":{"x":117,"y":754,"width":420,"height":12}},{"id":"64e62e64-9be6-4d74-8b8a-5a5764e13970","block_type":"box","text":"9","page_number":465,"box":{"x":143,"y":815,"width":4,"height":5}},{"id":"148140d2-be5a-47b3-bd90-7e4de0b13fab","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Reporting Standards (IFRS)","page_number":465,"box":{"x":170,"y":815,"width":666,"height":10}},{"id":"0c0483e2-03c8-410a-9d51-17a77a7306d5","block_type":"box","text":"Foundation. Please refer to the IFRS website to learn more about the framework and standards S1 “General","page_number":465,"box":{"x":171,"y":828,"width":641,"height":8}},{"id":"c9b17ce9-6c85-4620-b32b-0043269daa60","block_type":"box","text":"Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related Disclosures.”","page_number":465,"box":{"x":171,"y":841,"width":672,"height":9}},{"id":"fbff9a3b-48f7-43d6-8de6-2addfe6743c8","block_type":"box","text":"10","page_number":465,"box":{"x":144,"y":854,"width":8,"height":5}},{"id":"8a8c26c4-981f-43e8-801b-20788afde7b8","block_type":"box","text":"See, for examples, https://www.ifrs.org/news-and-events/news/2025/06/ifrs-foundation-publishes-jurisdictional-profiles","page_number":465,"box":{"x":170,"y":854,"width":705,"height":9}},{"id":"bc4f08a3-2d05-48dd-bbd8-5a5b5f561348","block_type":"box","text":"issb-standards/ and https://finance.ec.europa.eu/capital-markets-union-and-financial-markets/company","page_number":465,"box":{"x":170,"y":867,"width":615,"height":9}},{"id":"c636100f-f85d-4f0f-9dc6-98056ef4788f","block_type":"box","text":"reporting-and-auditing/company-reporting/corporate-sustainability-reporting_en","page_number":465,"box":{"x":170,"y":880,"width":468,"height":9}},{"id":"6dfde7e7-65b5-41a1-b5a5-c739b4f92e05","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":465,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"04242c5a-22e3-42ba-87c2-0acd582370a7","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":465,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"6a9548f0-3eed-405e-ae75-7f9e31389f9e","block_type":"box","text":"13","page_number":465,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"aa6be659-b82b-4221-a250-cda9b0ac224c","block_type":"box","text":"NM1026U-6004382-465/605","page_number":465,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"e67c3faa-4d52-4752-b297-4a4419220f3c","block_type":"box","text":"Shareholder rights and protections","page_number":466,"box":{"x":360,"y":87,"width":285,"height":12}},{"id":"1d068dee-59f3-43e4-a6ec-098d3cd6114d","block_type":"box","text":"General shareholder meetings","page_number":466,"box":{"x":116,"y":118,"width":247,"height":12}},{"id":"80aa4d66-c7cf-45f1-8a49-830a24be0a4c","block_type":"box","text":"Companies normally have an annual general meeting of shareholders at which routine and non-routine","page_number":466,"box":{"x":117,"y":149,"width":768,"height":12}},{"id":"0e8b50cd-9ea7-4063-a873-c507b896c9c9","block_type":"box","text":"items of business are discussed and voted on by shareholders in attendance or submitting proxy votes.","page_number":466,"box":{"x":117,"y":165,"width":771,"height":12}},{"id":"732a2654-bf65-462f-b123-3a3b72a9e9d0","block_type":"box","text":"Companies should disclose materials relevant to the shareholder meeting sufficiently in advance so","page_number":466,"box":{"x":117,"y":180,"width":742,"height":12}},{"id":"62bcd89f-1203-44ad-9cb9-3c2830d1ec7e","block_type":"box","text":"that shareholders can take them into consideration in their voting decisions. Many companies offer","page_number":466,"box":{"x":116,"y":196,"width":736,"height":12}},{"id":"48a90222-c36d-40c8-adc1-e39b2d103d62","block_type":"box","text":"shareholders the option of participating in the meeting virtually which, whilst welcome, should not limit","page_number":466,"box":{"x":116,"y":211,"width":758,"height":12}},{"id":"c5d7fec2-3513-4880-b7b6-f1e51658c4ad","block_type":"box","text":"the rights of shareholders to participate as they would during an in-person meeting.","page_number":466,"box":{"x":116,"y":227,"width":622,"height":12}},{"id":"1a81ea0c-f5c7-48bd-8820-fd8ee732306a","block_type":"box","text":"We may vote against directors when materials related to the business of the shareholder meeting are","page_number":466,"box":{"x":116,"y":258,"width":757,"height":12}},{"id":"1f11134d-6756-4498-9e10-db57bd737a7d","block_type":"box","text":"not provided in a timely manner or do not provide sufficient information for us to make an informed","page_number":466,"box":{"x":117,"y":273,"width":733,"height":12}},{"id":"2c074e9e-a0ad-491e-ac26-958b93067312","block_type":"box","text":"voting decision. We may vote against directors if the format of the shareholder meeting does not","page_number":466,"box":{"x":116,"y":289,"width":719,"height":12}},{"id":"fa757b41-103f-4426-81aa-25ef21855f5e","block_type":"box","text":"accommodate reasonable shareholder participation.","page_number":466,"box":{"x":116,"y":304,"width":392,"height":12}},{"id":"4f4e7cc4-2927-4c53-be12-1cbc4f75f4cd","block_type":"box","text":"Bylaw amendments","page_number":466,"box":{"x":117,"y":335,"width":161,"height":12}},{"id":"7273e6ba-9636-4280-900d-998127564b46","block_type":"box","text":"We review bylaw amendments proposed by management on a case-by-case basis and will generally","page_number":466,"box":{"x":116,"y":366,"width":753,"height":12}},{"id":"6897952e-e125-47ed-a789-e3a7c20e1fb4","block_type":"box","text":"support those that are aligned with the interests of minority shareholders. Any material changes to the","page_number":466,"box":{"x":116,"y":382,"width":761,"height":12}},{"id":"88c8bacd-b01e-469c-9087-587f70346b9d","block_type":"box","text":"bylaws should be explained in detail and put to a shareholder vote.","page_number":466,"box":{"x":117,"y":397,"width":500,"height":12}},{"id":"58819805-a8c0-4e72-8fa5-4be5aecfbcd9","block_type":"box","text":"We may vote against bylaw amendments that reduce shareholder rights and protections or introduce","page_number":466,"box":{"x":116,"y":428,"width":753,"height":12}},{"id":"f387900b-069f-4bcc-a4f7-86a8e02eac7a","block_type":"box","text":"additional burdens. We may vote against directors if material changes are made to the bylaws without","page_number":466,"box":{"x":116,"y":444,"width":760,"height":12}},{"id":"df27c047-74a2-4d48-b195-605ab54386f8","block_type":"box","text":"shareholder approval.","page_number":466,"box":{"x":116,"y":459,"width":167,"height":12}},{"id":"d53a9b92-50fb-46f1-8d43-f6af1793359c","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders,","page_number":466,"box":{"x":117,"y":490,"width":688,"height":12}},{"id":"5b063511-a783-4781-8c26-d31e3af2aca8","block_type":"box","text":"individually or as a group, with a meaningful shareholding, the right to call a special meeting of","page_number":466,"box":{"x":117,"y":506,"width":704,"height":12}},{"id":"908f9502-62f3-44f8-b6c2-d2e1d3cb2513","block_type":"box","text":"shareholders. The shareholding required to exercise this right should balance its utility with the cost to","page_number":466,"box":{"x":116,"y":521,"width":761,"height":12}},{"id":"0baa74d6-823f-43f1-9880-e0158b6b272e","block_type":"box","text":"the company of holding special meetings.","page_number":466,"box":{"x":116,"y":537,"width":313,"height":12}},{"id":"275a9dd5-c167-4854-bf24-3014fdb3829d","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders,","page_number":466,"box":{"x":117,"y":568,"width":688,"height":12}},{"id":"af3433aa-0c22-41d7-8917-a39154f907ef","block_type":"box","text":"individually or as a group, with a meaningful shareholding, the right to nominate directors to the","page_number":466,"box":{"x":117,"y":583,"width":710,"height":12}},{"id":"ba04b373-d4a9-4d2e-8bf6-b8cf0f69bae8","block_type":"box","text":"company’s board. The threshold for this right should be set so that shareholders can exercise it without","page_number":466,"box":{"x":116,"y":599,"width":770,"height":12}},{"id":"02765e04-4ae3-4cfc-b94f-026b7f83f352","block_type":"box","text":"being unduly disruptive to the board’s own nomination process.","page_number":466,"box":{"x":117,"y":614,"width":473,"height":12}},{"id":"430e268c-a2e6-4c19-a59c-1ffce3c1e8ac","block_type":"box","text":"Whilst we would not use either of these rights ourselves, we see them as important accountability","page_number":466,"box":{"x":116,"y":645,"width":728,"height":12}},{"id":"0643fa4b-105a-4701-99c6-4cabd0a818ef","block_type":"box","text":"mechanisms. We may vote for a shareholder proposal seeking the addition of either of these","page_number":466,"box":{"x":117,"y":661,"width":686,"height":12}},{"id":"b7660450-6175-474b-b898-d9ee20e27a58","block_type":"box","text":"provisions to a company’s bylaws.","page_number":466,"box":{"x":117,"y":676,"width":252,"height":12}},{"id":"acc1f273-e741-49be-acb9-7455dd4eb3f1","block_type":"box","text":"Change of domicile","page_number":466,"box":{"x":116,"y":707,"width":154,"height":12}},{"id":"d8f039e0-5134-4f08-a9aa-fbb58b3097e7","block_type":"box","text":"We generally defer to management on proposals to change a company’s domicile as long as the","page_number":466,"box":{"x":116,"y":738,"width":717,"height":12}},{"id":"9d50ae45-a7cb-4a2a-985a-186704de6db5","block_type":"box","text":"rationale for doing so is consistent with the company’s long-term strategy and business model and the","page_number":466,"box":{"x":117,"y":754,"width":756,"height":12}},{"id":"2ba14b6b-f90c-4173-88f2-bdb017e6f475","block_type":"box","text":"related costs are immaterial.","page_number":466,"box":{"x":117,"y":769,"width":209,"height":10}},{"id":"d9ec7b44-d54b-45d8-8f9c-a0f33e0b6398","block_type":"box","text":"We may vote against directors or a proposal to change a company’s domicile where it does not seem","page_number":466,"box":{"x":116,"y":800,"width":751,"height":12}},{"id":"c7c8bb04-fbff-4547-af55-87b2f7e07129","block_type":"box","text":"aligned with our clients’ financial interests.","page_number":466,"box":{"x":116,"y":816,"width":311,"height":12}},{"id":"4ed217a8-909a-4a46-ac43-0f636862f6c7","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":466,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"372dba77-cccf-4b93-8c01-9d6630467146","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":466,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"0d171157-dde3-4faf-9eed-6be55c01bb8b","block_type":"box","text":"14","page_number":466,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"899cf174-36f7-433a-a207-0fb9c673b5a3","block_type":"box","text":"NM1026U-6004382-466/605","page_number":466,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5effbbb6-913d-42eb-a240-4fedf44ed4e6","block_type":"box","text":"Changes to a company’s purpose or the nature of its business","page_number":467,"box":{"x":116,"y":87,"width":504,"height":12}},{"id":"b7ec372c-db15-4308-9393-35394470fa07","block_type":"box","text":"Plans to materially change the nature of a company’s business or its purpose should be disclosed and","page_number":467,"box":{"x":117,"y":118,"width":762,"height":12}},{"id":"c7ec5dc7-fd7e-41f8-887f-a36536c16895","block_type":"box","text":"explained in the context of long-term strategy and business dynamics. Such changes may significantly","page_number":467,"box":{"x":116,"y":134,"width":764,"height":12}},{"id":"5ed9e758-dbb1-4651-86f7-4fd29ddd8273","block_type":"box","text":"alter an investor’s views on the suitability of a company for their investment strategy or portfolio.","page_number":467,"box":{"x":116,"y":149,"width":716,"height":12}},{"id":"e48caf94-b9e0-40cf-b8a2-e386505d3eb4","block_type":"box","text":"Where relevant, we may vote against proposals to change a company’s purpose or the nature of its","page_number":467,"box":{"x":116,"y":180,"width":743,"height":12}},{"id":"7a642c1e-b42a-48f6-8359-f47693ecc4d9","block_type":"box","text":"business if the board has not provided a credible argument for change.","page_number":467,"box":{"x":117,"y":196,"width":530,"height":12}},{"id":"6c6b72ea-e9b6-4c1b-9b0c-7ce9f304134b","block_type":"box","text":"Shareholder proposals","page_number":467,"box":{"x":409,"y":227,"width":187,"height":11}},{"id":"1e23b7e0-c309-4dbb-b0d6-525f30eeb719","block_type":"box","text":"Shareholders in many markets, who meet certain eligibility criteria, have the right to submit proposals","page_number":467,"box":{"x":116,"y":258,"width":756,"height":12}},{"id":"0cfcae76-40a1-4f11-b4d4-041f3bb84364","block_type":"box","text":"to the general shareholder meeting asking a company to take a particular course of action subject to","page_number":467,"box":{"x":116,"y":273,"width":749,"height":12}},{"id":"5a75390c-a416-4357-8998-1e562daf00e8","block_type":"box","text":"the proposal being supported by a majority of votes cast at the meeting. The topics raised can address","page_number":467,"box":{"x":116,"y":289,"width":767,"height":12}},{"id":"08242d46-20e9-4e0c-abc4-4126f181658a","block_type":"box","text":"a range of matters that may be relevant to a company’s business.","page_number":467,"box":{"x":116,"y":304,"width":492,"height":12}},{"id":"4e4f498a-f5cd-4616-b864-30dfb02cf650","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":467,"box":{"x":116,"y":335,"width":767,"height":12}},{"id":"2e96bae2-2acf-4de4-952d-8fe9cbba47b8","block_type":"box","text":"company’s business and its current approach, whether the actions sought are consistent with","page_number":467,"box":{"x":116,"y":351,"width":697,"height":12}},{"id":"2dd3a8f2-d9b3-4a39-afec-d56626eefd9d","block_type":"box","text":"shareholders’ interests, and what impact the proposal being acted upon might have on financial","page_number":467,"box":{"x":116,"y":366,"width":714,"height":12}},{"id":"ecca8f82-9022-4086-b584-6e1d74fe395e","block_type":"box","text":"performance.","page_number":467,"box":{"x":117,"y":382,"width":103,"height":12}},{"id":"14400b85-d39b-440f-a6cf-e988718480f0","block_type":"box","text":"Our general approach where we have concerns about a company’s governance, disclosures or","page_number":467,"box":{"x":116,"y":413,"width":711,"height":12}},{"id":"875c9f86-6be2-4c47-bc97-07fb24e40898","block_type":"box","text":"performance is to engage to understand the apparent difference in perspective. If we are concerned a","page_number":467,"box":{"x":117,"y":428,"width":760,"height":12}},{"id":"a26ea77d-63f4-41c1-bbbd-40345a86b28a","block_type":"box","text":"company is not acting in shareholders’ financial interests, we may vote against the election of directors.","page_number":467,"box":{"x":116,"y":444,"width":772,"height":12}},{"id":"d63c04e9-a459-46c2-851e-f2949c83fa8a","block_type":"box","text":"We may support a relevant shareholder proposal if doing so is aligned with our clients’ financial","page_number":467,"box":{"x":116,"y":459,"width":712,"height":12}},{"id":"ca6443f5-5313-41f2-9d71-4231d038411c","block_type":"box","text":"interests. We generally do not support shareholder proposals that are legally binding on the company,","page_number":467,"box":{"x":117,"y":475,"width":760,"height":12}},{"id":"bfd161d6-36ae-4473-8f25-2f24e5414206","block_type":"box","text":"seek to alter a company’s strategy or direct its operations, or are unrelated to how a company","page_number":467,"box":{"x":116,"y":490,"width":700,"height":12}},{"id":"a3b6cc87-70f2-488a-9690-22f0faf4d5ae","block_type":"box","text":"manages risk or generates financial returns.","page_number":467,"box":{"x":117,"y":506,"width":331,"height":12}},{"id":"3b7b0cd2-2e61-4a26-8890-3d57775cdb98","block_type":"box","text":"BlackRock is subject to rules, regulations, agency guidance and contractual agreements that place","page_number":467,"box":{"x":117,"y":537,"width":737,"height":12}},{"id":"6dad1114-bf0a-4a25-aca2-d7f756a734a1","block_type":"box","text":"restrictions and limitations on how we can interact with the companies in which we invest on behalf of","page_number":467,"box":{"x":117,"y":552,"width":755,"height":12}},{"id":"b97d5490-a624-4ac2-9d2b-28639e37a28d","block_type":"box","text":"our clients, including our ability to submit shareholder proposals. We do not submit shareholder","page_number":467,"box":{"x":116,"y":568,"width":712,"height":12}},{"id":"9f8c07b5-12cd-498e-bed1-138f688e36db","block_type":"box","text":"proposals but can vote, on behalf of clients who authorize us to do so, on proposals put forth by others.","page_number":467,"box":{"x":117,"y":583,"width":770,"height":12}},{"id":"bc06a296-8f24-4a1c-8ce7-07a99f90d5eb","block_type":"box","text":"Corporate political activities","page_number":467,"box":{"x":387,"y":614,"width":230,"height":12}},{"id":"32bff988-ac9f-42cf-a477-db4f5aacc3f0","block_type":"box","text":"A corporation’s ability to engage in the policy process is subject to rules and regulations set by the","page_number":467,"box":{"x":116,"y":645,"width":733,"height":12}},{"id":"9c8c893b-7a04-4747-92fd-aa9872f2d609","block_type":"box","text":"jurisdictions in which they engage. When a corporation reports material financial risk related to policy","page_number":467,"box":{"x":115,"y":661,"width":749,"height":12}},{"id":"8ffd0e14-9106-4ebe-99f2-c8186cf10410","block_type":"box","text":"and or regulatory changes, BAIS may seek to understand how it is addressing the material risk","page_number":467,"box":{"x":116,"y":676,"width":703,"height":12}},{"id":"ead2e48e-16c4-4b4f-ae19-7e57045f005d","block_type":"box","text":"identified. We seek to understand how companies engage in corporate political activities and ensure","page_number":467,"box":{"x":117,"y":692,"width":743,"height":12}},{"id":"5acd0882-2eec-4b84-9cf6-619cbf60b57e","block_type":"box","text":"that their participation is consistent with their public statements on policy matters material to the","page_number":467,"box":{"x":116,"y":707,"width":709,"height":12}},{"id":"3c3a6e2a-5cee-4d1b-a7d4-cb7ff91d6e83","block_type":"box","text":"company’s long-term strategy. The board should be aware of the approach taken by management on","page_number":467,"box":{"x":116,"y":723,"width":750,"height":12}},{"id":"a5f8c3d8-1c03-4ee8-a743-0a7495fa9fc0","block_type":"box","text":"corporate political activities as there can be reputational risks arising from inconsistencies between a","page_number":467,"box":{"x":116,"y":738,"width":746,"height":12}},{"id":"58f6848d-7067-4ce5-800b-a4df59e9249e","block_type":"box","text":"company’s policy engagement and stated policy positions. Companies should, as a minimum, meet all","page_number":467,"box":{"x":116,"y":754,"width":758,"height":12}},{"id":"6812d713-cefa-4a1e-921e-35e423e1b5d8","block_type":"box","text":"regulatory disclosure requirements on political activities. We may engage a company where we would","page_number":467,"box":{"x":117,"y":769,"width":753,"height":12}},{"id":"9a2fb14c-141a-43c8-9c2f-43d46d26b1bd","block_type":"box","text":"like to better understand its approach to policy engagement, where relevant.","page_number":467,"box":{"x":117,"y":785,"width":563,"height":12}},{"id":"a90532e0-530d-4006-9ce2-bc60b412df31","block_type":"box","text":"To mitigate the risk of inconsistencies, companies may wish to assess the alignment between their","page_number":467,"box":{"x":116,"y":816,"width":732,"height":12}},{"id":"77cc80a4-e1a0-40e0-8345-ef7711522e0b","block_type":"box","text":"policy priorities and the policy positions of the trade associations of which they are active members and","page_number":467,"box":{"x":117,"y":831,"width":770,"height":12}},{"id":"c30c4ee1-ef67-4da2-b68b-626c63ffd7a8","block_type":"box","text":"any engagements undertaken by trade associations on behalf of members.","page_number":467,"box":{"x":116,"y":847,"width":562,"height":12}},{"id":"9de907b8-ee8a-4260-b27f-afc178aca658","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":467,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"c036a276-6b12-4325-8714-5c3560f1b739","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":467,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"b635fd82-9ef3-430d-9a0b-33d053766650","block_type":"box","text":"15","page_number":467,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"49481fd9-4133-4d55-87ba-6a9ea6e4a6c8","block_type":"box","text":"NM1026U-6004382-467/605","page_number":467,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c08a7a68-e21f-4861-b0e3-903ab7f462df","block_type":"box","text":"We may support a relevant shareholder proposal, or vote against directors, where a company’s","page_number":468,"box":{"x":116,"y":87,"width":712,"height":12}},{"id":"4d6eb7cd-fb6b-4379-94fd-127d5c9a54d9","block_type":"box","text":"disclosures are insufficient to address the material risk it has identified.","page_number":468,"box":{"x":116,"y":102,"width":530,"height":10}},{"id":"381df5f9-5d4d-46c8-8f73-c66f1b50ec8e","block_type":"box","text":"Material sustainability-related risks and opportunities","page_number":468,"box":{"x":287,"y":134,"width":431,"height":12}},{"id":"b62cece9-a9dc-4d26-b7ba-d092402957c8","block_type":"box","text":"We seek to understand how companies manage the material risks and opportunities inherent in their","page_number":468,"box":{"x":116,"y":165,"width":751,"height":12}},{"id":"4f952e87-7892-4d7d-9c25-63262178668c","block_type":"box","text":"business operations. In our experience, sustainability-related factors","page_number":468,"box":{"x":117,"y":180,"width":505,"height":12}},{"id":"03983755-300a-4ffd-bad1-627b215ce155","block_type":"box","text":"11","page_number":468,"box":{"x":624,"y":180,"width":9,"height":6}},{"id":"f85d89b3-427b-4c58-9003-4948c97ab1b0","block_type":"box","text":"that are relevant to a company’s","page_number":468,"box":{"x":635,"y":180,"width":249,"height":12}},{"id":"161f6008-026f-4736-8179-7bb182e9412a","block_type":"box","text":"business or material to its financial performance, are generally operational considerations embedded","page_number":468,"box":{"x":117,"y":196,"width":752,"height":12}},{"id":"3ce503ed-fb1d-4776-a47b-75d77e5065a3","block_type":"box","text":"into day-to-day management systems. Certain sustainability issues may also inform long-term strategic","page_number":468,"box":{"x":117,"y":211,"width":769,"height":12}},{"id":"58ecd660-6114-4bc3-add9-6f7dc8630c13","block_type":"box","text":"planning, for example, investing in product innovation in anticipation of changing consumer demand or","page_number":468,"box":{"x":117,"y":227,"width":763,"height":12}},{"id":"ef8e9bf6-f853-4d85-ab2a-cf4c08a77f44","block_type":"box","text":"adapting supply chains in response to changing regulatory requirements.","page_number":468,"box":{"x":116,"y":242,"width":546,"height":12}},{"id":"0dcd4b08-da0a-48fe-b69e-6eaafa654802","block_type":"box","text":"We recognize that the specific sustainability-related factors that may be financially material or business","page_number":468,"box":{"x":116,"y":273,"width":769,"height":12}},{"id":"de6aa738-abe4-4137-ab8f-06e2eff1dec0","block_type":"box","text":"relevant will vary by company business model, sector, key markets, and time horizon, amongst other","page_number":468,"box":{"x":117,"y":289,"width":751,"height":12}},{"id":"031c9c98-4a4b-431d-b9df-322ced10f7f6","block_type":"box","text":"considerations. From company disclosures and our engagement, we aim to understand how","page_number":468,"box":{"x":116,"y":304,"width":689,"height":12}},{"id":"7bebd88f-fb70-4ea8-837f-18a8be00e6c2","block_type":"box","text":"management is identifying, assessing and integrating material sustainability-related risks and","page_number":468,"box":{"x":117,"y":320,"width":694,"height":12}},{"id":"46bcdd18-2ca3-4031-9d38-1e4f9ca3e551","block_type":"box","text":"opportunities into their business decision-making and practices. Doing so helps us undertake a more","page_number":468,"box":{"x":116,"y":335,"width":752,"height":12}},{"id":"cc67dd8c-1882-4032-9e24-e5396d3da6e7","block_type":"box","text":"holistic assessment of a company’s potential financial performance and the likely risk-adjusted returns","page_number":468,"box":{"x":117,"y":351,"width":761,"height":12}},{"id":"6de94748-39b3-45e8-85cb-b25a98253194","block_type":"box","text":"of an investment.","page_number":468,"box":{"x":116,"y":366,"width":133,"height":10}},{"id":"af9dc38b-f184-4491-8165-0fd9c3f96f79","block_type":"box","text":"We may vote against directors or support a relevant shareholder proposal if we have concerns about","page_number":468,"box":{"x":116,"y":397,"width":753,"height":12}},{"id":"baa6db5c-12bd-4f8b-9563-93c861e2c0e1","block_type":"box","text":"how a company is managing or disclosing its approach to material sustainability-related risks that may","page_number":468,"box":{"x":117,"y":413,"width":761,"height":12}},{"id":"33589d49-ce75-4b62-bb3a-e721556e2fad","block_type":"box","text":"impact financial returns.","page_number":468,"box":{"x":117,"y":428,"width":181,"height":12}},{"id":"ae817f89-63a0-4c7d-8611-232c864c1830","block_type":"box","text":"Key stakeholders","page_number":468,"box":{"x":431,"y":459,"width":143,"height":12}},{"id":"3a6641be-d1a6-4c05-888c-8f546e833813","block_type":"box","text":"In our view, companies should understand and take into consideration the interests of the various","page_number":468,"box":{"x":117,"y":490,"width":727,"height":12}},{"id":"0a14f10c-02c7-4fa7-a333-2bff0140ece8","block_type":"box","text":"parties on whom they depend for their success over time. It is for each company to determine their key","page_number":468,"box":{"x":117,"y":506,"width":766,"height":12}},{"id":"84f59ecb-60d0-44d5-87f7-1094c78158d9","block_type":"box","text":"stakeholders based on what is material to their business and long-term financial performance. For","page_number":468,"box":{"x":116,"y":521,"width":731,"height":12}},{"id":"86febc98-bb81-4e94-b2f9-91cc39e89202","block_type":"box","text":"many companies, key stakeholders include employees, business partners (such as suppliers and","page_number":468,"box":{"x":117,"y":537,"width":726,"height":12}},{"id":"0299bd9d-deee-4f9d-b015-f07bf21a1ae3","block_type":"box","text":"distributors), clients and consumers, regulators, and the communities in which they operate.","page_number":468,"box":{"x":116,"y":552,"width":687,"height":12}},{"id":"e0e3df3b-ce16-4ca4-8ada-41bd75b1f444","block_type":"box","text":"Companies that appropriately balance the interests of investors and other stakeholders are, in our","page_number":468,"box":{"x":117,"y":568,"width":730,"height":12}},{"id":"87b5949a-2596-459a-b519-3c0d5585c2b7","block_type":"box","text":"experience, more likely to be financially resilient over time.","page_number":468,"box":{"x":116,"y":583,"width":438,"height":12}},{"id":"76ca724a-1d84-4ac7-a813-3f37d72bdb4a","block_type":"box","text":"Climate and decarbonization investment objectives","page_number":468,"box":{"x":295,"y":614,"width":414,"height":12}},{"id":"200bf5a1-6d7b-4960-9018-3553eeaf90a0","block_type":"box","text":"Certain active BlackRock funds have climate and decarbonization objectives in addition to financial","page_number":468,"box":{"x":117,"y":645,"width":737,"height":12}},{"id":"761ba431-692e-435c-8560-eca064e4d30d","block_type":"box","text":"objectives. Consistent with the objectives of those investment strategies, our stewardship activity in","page_number":468,"box":{"x":116,"y":661,"width":735,"height":12}},{"id":"b5912ae9-adc6-4f83-ab31-a21c8216dc74","block_type":"box","text":"relation to the holdings in those funds differs in some respects from BAIS’ benchmark guidelines, which","page_number":468,"box":{"x":117,"y":676,"width":765,"height":12}},{"id":"ca1e784e-e48d-4cd6-b729-990ebf05e52f","block_type":"box","text":"are described above. Specifically, for those funds’ holdings, we look to investee companies to","page_number":468,"box":{"x":116,"y":692,"width":694,"height":12}},{"id":"9f15b90f-0a70-4c5c-b532-f90626728bdc","block_type":"box","text":"demonstrate that they are aligned with a decarbonization pathway that means their business model","page_number":468,"box":{"x":116,"y":707,"width":736,"height":12}},{"id":"8f30808d-47b2-40d8-a609-af4d5631e38b","block_type":"box","text":"would be viable in a low-carbon economy, i.e., one in which global temperature rise is limited to 1.5°C","page_number":468,"box":{"x":116,"y":723,"width":754,"height":12}},{"id":"338efaff-b463-46bd-ba03-de61a587cf9f","block_type":"box","text":"11","page_number":468,"box":{"x":144,"y":776,"width":7,"height":5}},{"id":"b77fa91d-35b3-4934-8bf0-d0b1fe802575","block_type":"box","text":"By material sustainability-related risks and opportunities, we mean the drivers of risk and financial value creation in a","page_number":468,"box":{"x":171,"y":776,"width":691,"height":10}},{"id":"dd23b722-c6aa-4c5b-89cd-531169bb4b5a","block_type":"box","text":"company’s business model that have an environmental or social dependency or impact. Examples of environmental","page_number":468,"box":{"x":170,"y":789,"width":686,"height":10}},{"id":"a882159b-494c-4b32-8089-b059ffd67bca","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":468,"box":{"x":170,"y":802,"width":682,"height":10}},{"id":"583005a5-536c-4395-85fd-4473119d146a","block_type":"box","text":"issues include, but are not limited to, human capital management, impacts on the communities in which a company","page_number":468,"box":{"x":170,"y":815,"width":683,"height":10}},{"id":"3d686d98-d9cf-46e2-b89c-860e6a5f7c35","block_type":"box","text":"operates, customer loyalty, and relationships with regulators. It is our view that well-managed companies will effectively","page_number":468,"box":{"x":170,"y":828,"width":708,"height":10}},{"id":"79f488d1-e902-47bb-9f5b-b012e9ceeff6","block_type":"box","text":"evaluate and manage material sustainability-related risks and opportunities relevant to their businesses. Governance is","page_number":468,"box":{"x":170,"y":841,"width":707,"height":9}},{"id":"001e86c2-b604-40c1-9c7e-22e539f6f28e","block_type":"box","text":"the core means by which boards can oversee the creation of durable financial value over time. Appropriate risk","page_number":468,"box":{"x":170,"y":854,"width":658,"height":9}},{"id":"6a8ffc6b-41f7-4d55-af78-0c2de4ad1f81","block_type":"box","text":"oversight of business-relevant and material sustainability-related considerations is a component of a sound governance","page_number":468,"box":{"x":170,"y":867,"width":708,"height":9}},{"id":"efe1d589-1cd0-4e67-8515-2eb526b0bbf7","block_type":"box","text":"framework.","page_number":468,"box":{"x":170,"y":880,"width":65,"height":7}},{"id":"0313228b-008f-4ba8-904d-b1bbbcedab4e","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":468,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"482d16d7-560b-4104-afda-c9a7fc35c68d","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":468,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"6846a312-90b7-45d0-97a8-fc29d3b28e4f","block_type":"box","text":"16","page_number":468,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"8749c0ad-cd0f-4f3b-81ab-c754b5cc4096","block_type":"box","text":"NM1026U-6004382-468/605","page_number":468,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"269edbfe-f696-4fa4-b4e7-c285b44609cc","block_type":"box","text":"above pre-industrial levels. In addition, clients in separately managed accounts may instruct BlackRock","page_number":469,"box":{"x":116,"y":87,"width":771,"height":12}},{"id":"0f9b0769-5805-4a10-8679-47506ef3a831","block_type":"box","text":"to apply these guidelines to their holdings. Both in the case of funds and separately managed","page_number":469,"box":{"x":116,"y":102,"width":698,"height":13}},{"id":"632e94de-8458-466a-b459-7c7297ab9505","block_type":"box","text":"accounts, these guidelines are only implemented upon explicit selection and approval by the applicable","page_number":469,"box":{"x":116,"y":118,"width":770,"height":12}},{"id":"7eb93426-2229-4ac7-903e-1eca3476c09c","block_type":"box","text":"fund board or client.","page_number":469,"box":{"x":116,"y":134,"width":153,"height":9}},{"id":"58f55c7d-c092-48ff-9e64-a6ee9feae349","block_type":"box","text":"These decarbonization stewardship guidelines focus on companies which produce goods and services","page_number":469,"box":{"x":116,"y":165,"width":766,"height":12}},{"id":"6ef96cba-2e1d-446b-b163-a20027004b27","block_type":"box","text":"that contribute to real world decarbonization or have a carbon intensive business model and face","page_number":469,"box":{"x":116,"y":180,"width":724,"height":10}},{"id":"dd29efe6-a392-49da-bbb3-4c8609008283","block_type":"box","text":"outsized impacts from the low carbon transition, based on reported and estimated scopes 1, 2, and 3","page_number":469,"box":{"x":116,"y":196,"width":754,"height":11}},{"id":"04169a97-72e2-4034-858d-6a4ba86e5b87","block_type":"box","text":"greenhouse gas emissions. These companies should provide disclosures that set out their","page_number":469,"box":{"x":116,"y":211,"width":675,"height":12}},{"id":"fa038bed-8b71-40db-a95e-9b8d8183af4a","block_type":"box","text":"governance, strategy, risk management processes and metrics and targets relevant to","page_number":469,"box":{"x":116,"y":227,"width":646,"height":12}},{"id":"352919d0-ae85-48db-89a8-cd0803703915","block_type":"box","text":"decarbonization. It is helpful to investors’ understanding when these disclosures include an explanation","page_number":469,"box":{"x":116,"y":242,"width":770,"height":12}},{"id":"afff6451-db97-4f0f-89e5-324352e2a0d7","block_type":"box","text":"of the decarbonization scenarios a company is using in its near- and long-term planning, as well as its","page_number":469,"box":{"x":116,"y":258,"width":760,"height":12}},{"id":"d18c7094-fa7f-43a1-b21d-74651cc117db","block_type":"box","text":"scope 1, scope 2 and material scope 3 greenhouse gas (GHG) emissions and reduction targets for","page_number":469,"box":{"x":116,"y":273,"width":739,"height":12}},{"id":"b0d0548a-c107-43cc-a215-941587adc45b","block_type":"box","text":"scope 1 and 2 emissions.","page_number":469,"box":{"x":116,"y":289,"width":194,"height":12}},{"id":"792534b0-7aa5-43db-a542-1956d929d516","block_type":"box","text":"Under these climate- and decarbonization-specific guidelines, BAIS may recommend a vote against","page_number":469,"box":{"x":117,"y":320,"width":744,"height":12}},{"id":"6d411373-dc01-41e9-9bb0-76d0916090d3","block_type":"box","text":"directors or support for a relevant shareholder proposal if a company does not appear to be adequately","page_number":469,"box":{"x":116,"y":335,"width":771,"height":12}},{"id":"56396d85-60a0-4635-bd2a-18b09deff62c","block_type":"box","text":"acting to address or disclosing material climate-related risks, consistent with the parameters set out in","page_number":469,"box":{"x":116,"y":351,"width":761,"height":12}},{"id":"4d86bd6e-1906-4ecf-977d-73612a92810a","block_type":"box","text":"these climate- and decarbonization-specific guidelines. We may recommend supporting shareholder","page_number":469,"box":{"x":116,"y":366,"width":749,"height":12}},{"id":"0ae5b546-3cc2-44ce-b98d-cbe15e842afd","block_type":"box","text":"proposals seeking information relevant to a company’s stated low-carbon transition strategy or targets","page_number":469,"box":{"x":117,"y":382,"width":760,"height":12}},{"id":"43eb8ae0-f5f2-4aeb-b52c-f9138622581e","block_type":"box","text":"that the company does not currently provide and that would be helpful to investment decision-making.","page_number":469,"box":{"x":116,"y":397,"width":760,"height":12}},{"id":"c5e2d54f-d8b1-40be-bc45-4f3495397734","block_type":"box","text":"We would not recommend support for shareholder proposals that seek to constrain board or","page_number":469,"box":{"x":116,"y":413,"width":689,"height":12}},{"id":"8ab75293-ddaa-49d5-8aa6-95e3e8f06fb0","block_type":"box","text":"management decision-making or direct specific business or strategic decisions. As under the BAIS","page_number":469,"box":{"x":117,"y":428,"width":736,"height":12}},{"id":"e8c5c25b-4085-46d2-b1cf-36641e25afd6","block_type":"box","text":"benchmark approach, the active portfolio managers are ultimately responsible for voting consistent","page_number":469,"box":{"x":117,"y":444,"width":737,"height":12}},{"id":"3c769b40-ec7e-4cf0-bd39-031afaf31567","block_type":"box","text":"with their investment mandate and fund objectives. For the funds and accounts in scope, voting on","page_number":469,"box":{"x":116,"y":459,"width":736,"height":12}},{"id":"0f62b211-cc96-4728-bc48-c46a517f5d83","block_type":"box","text":"matters not related to climate risk and the energy transition is undertaken in line with BAIS’ benchmark","page_number":469,"box":{"x":117,"y":475,"width":765,"height":12}},{"id":"779c81da-e63a-45de-91a9-02b585eb548d","block_type":"box","text":"guidelines.","page_number":469,"box":{"x":116,"y":490,"width":85,"height":12}},{"id":"44031dad-1ea0-40da-acd0-375e818eb282","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":469,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"e7a16f74-47eb-4f5d-b30f-011eab52d112","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":469,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"aaaf7036-dff6-4d1c-bbbb-0dbf30268c6d","block_type":"box","text":"17","page_number":469,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"cdb4d80f-297b-41f6-8eac-b4993e3734d3","block_type":"box","text":"NM1026U-6004382-469/605","page_number":469,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"2b05e9b3-4700-40bd-b686-d74bc0b7eda2","block_type":"box","text":"Appendix 1: How we fulfil and oversee our investment stewardship responsibilities","page_number":470,"box":{"x":116,"y":87,"width":668,"height":12}},{"id":"6025af64-28d0-4401-a64d-06f6bd72b302","block_type":"box","text":"Oversight","page_number":470,"box":{"x":116,"y":118,"width":83,"height":12}},{"id":"4de85cfb-a2a7-4265-8405-33ed56185b79","block_type":"box","text":"The Global Head of BAIS has primary oversight of and responsibility for the team’s activities, including","page_number":470,"box":{"x":116,"y":149,"width":764,"height":12}},{"id":"84133491-abca-4ac2-8f82-9ecd8b9a7f8c","block_type":"box","text":"voting in accordance with the BlackRock Active Investment Stewardship Global Engagement and","page_number":470,"box":{"x":116,"y":165,"width":726,"height":12}},{"id":"8057da69-cc96-443f-92b0-573825b9c25d","block_type":"box","text":"Voting Guidelines (the “Guidelines”), which require the application of professional judgment and","page_number":470,"box":{"x":116,"y":180,"width":714,"height":12}},{"id":"58c2abc1-f1fb-4f72-b76c-ff0cb03eb774","block_type":"box","text":"consideration of each company’s unique circumstances, as well as input from active investors. BAIS is","page_number":470,"box":{"x":116,"y":196,"width":765,"height":12}},{"id":"73513442-6e30-4d20-97c5-c0841e5e0d10","block_type":"box","text":"independent from BlackRock Investment Stewardship in our engagement and voting activities,","page_number":470,"box":{"x":117,"y":211,"width":704,"height":12}},{"id":"4fb85cbe-fd99-4152-a0d1-4dde57aeef1d","block_type":"box","text":"reporting lines, and oversight.","page_number":470,"box":{"x":117,"y":227,"width":224,"height":12}},{"id":"4a13bf0f-621f-4daa-becb-8e43bdc10039","block_type":"box","text":"The Stewardship Leaders Group, comprised of senior active investors and other relevant stakeholders","page_number":470,"box":{"x":116,"y":258,"width":765,"height":11}},{"id":"69d7cc3a-ffdf-44cf-a688-3aa20b594f21","block_type":"box","text":"in BlackRock’s legal, public policy, sustainability and communications teams, helps shape the firm’s","page_number":470,"box":{"x":117,"y":273,"width":742,"height":12}},{"id":"848a7565-7bb7-46af-aff7-9a8f501728d0","block_type":"box","text":"approach to investment stewardship on non-index equity investment strategies. The Group may advise","page_number":470,"box":{"x":116,"y":289,"width":769,"height":12}},{"id":"ad01f9c1-49ed-4692-9cca-166b5bf2c578","block_type":"box","text":"on and review amendments to BAIS’ policies and practices. It does not determine voting decisions,","page_number":470,"box":{"x":116,"y":304,"width":739,"height":12}},{"id":"3d6a2bf5-2a24-43c8-aafc-55b2bd9f30fc","block_type":"box","text":"which are the responsibility of BAIS and the relevant active equity investors.","page_number":470,"box":{"x":116,"y":320,"width":568,"height":12}},{"id":"998d54a3-83d7-40d4-9c48-5980cbb1a764","block_type":"box","text":"BAIS carries out engagement with companies in collaboration with active investment colleagues,","page_number":470,"box":{"x":117,"y":351,"width":721,"height":12}},{"id":"e601fef5-3e80-49e1-bf9c-4563bdb6baa1","block_type":"box","text":"executes proxy votes, and conducts vote operations (including maintaining records of votes cast) in a","page_number":470,"box":{"x":116,"y":366,"width":757,"height":12}},{"id":"2efc3b4b-d95e-4a3d-8b1f-f816c12d566c","block_type":"box","text":"manner consistent with the Guidelines. BAIS also conducts research on corporate governance issues","page_number":470,"box":{"x":117,"y":382,"width":757,"height":12}},{"id":"66b97158-f73f-408c-8421-824dcc596015","block_type":"box","text":"and participates in industry discussions to contribute to and keep abreast of important developments in","page_number":470,"box":{"x":116,"y":397,"width":768,"height":12}},{"id":"79162e2d-63ff-425b-ae7b-6512fd6763bf","block_type":"box","text":"the corporate governance field. BAIS may use third parties for certain of the foregoing activities and","page_number":470,"box":{"x":116,"y":413,"width":744,"height":12}},{"id":"71b0a0c8-167b-4d90-be91-14512c5b3061","block_type":"box","text":"performs oversight of those third parties (see “Use and oversight of third-party vote services providers”","page_number":470,"box":{"x":117,"y":428,"width":765,"height":12}},{"id":"ec1724b7-30c3-484e-8b86-079eede884ce","block_type":"box","text":"below).","page_number":470,"box":{"x":117,"y":444,"width":58,"height":12}},{"id":"efb1a93f-4e4e-43e7-9054-8ff55ad68f1f","block_type":"box","text":"Voting guidelines and vote execution","page_number":470,"box":{"x":116,"y":475,"width":302,"height":12}},{"id":"2b8334a2-b51a-4f12-ae9d-3061d4b8c087","block_type":"box","text":"BlackRock votes on proxy issues when our clients authorize us to do so. We carefully consider the","page_number":470,"box":{"x":117,"y":506,"width":735,"height":12}},{"id":"669283d7-6eef-42a9-ba2f-8780077af766","block_type":"box","text":"voting items submitted to funds and other fiduciary account(s) (Fund or Funds) for which we have","page_number":470,"box":{"x":116,"y":521,"width":728,"height":12}},{"id":"be272cce-5a94-4659-a78e-71b900879c41","block_type":"box","text":"voting authority. BlackRock votes (or refrains from voting) for each Fund for which we have voting","page_number":470,"box":{"x":116,"y":537,"width":730,"height":12}},{"id":"ec8a5bbf-a61d-47ae-bfc1-8345c40fdf92","block_type":"box","text":"authority based on our evaluation of the alignment of the voting items with the long-term economic","page_number":470,"box":{"x":116,"y":552,"width":734,"height":12}},{"id":"a538e15d-5e91-4cac-b9a6-7494a6a90bd1","block_type":"box","text":"interests of our clients, in the exercise of our independent business judgment, and without regard to the","page_number":470,"box":{"x":117,"y":568,"width":771,"height":12}},{"id":"958badee-e99b-43d2-bd54-7fe4c3793949","block_type":"box","text":"relationship of the issuer (or any shareholder proponent or dissident shareholder) to the Fund, the","page_number":470,"box":{"x":117,"y":583,"width":730,"height":12}},{"id":"f911039b-934b-4c72-91cb-3c0bafb2f4d7","block_type":"box","text":"Fund’s affiliates (if any), BlackRock or BlackRock’s affiliates, or BlackRock employees (see “Conflicts","page_number":470,"box":{"x":117,"y":599,"width":754,"height":12}},{"id":"a5503ae6-7e03-4279-a60a-ec67c1366ecb","block_type":"box","text":"management policies and procedures,” below).","page_number":470,"box":{"x":117,"y":614,"width":353,"height":12}},{"id":"ca3ac55d-86a9-44eb-953a-c8c9dfbcd5b1","block_type":"box","text":"When exercising voting rights, BAIS will normally vote on specific proxy issues in accordance with the","page_number":470,"box":{"x":116,"y":645,"width":759,"height":12}},{"id":"4fb029b7-3b75-4569-a540-cdd90a6d32c3","block_type":"box","text":"Guidelines, although portfolio managers have the right to vote differently on their holdings if they","page_number":470,"box":{"x":117,"y":661,"width":713,"height":12}},{"id":"9cf493a4-23d6-4989-9b80-cc34abe6044f","block_type":"box","text":"determine doing so is more aligned with the investment objective and financial interests of clients","page_number":470,"box":{"x":116,"y":676,"width":719,"height":12}},{"id":"9fa64814-a0b8-4c5f-b3bc-3a43804a9f54","block_type":"box","text":"invested in the funds they manage.","page_number":470,"box":{"x":117,"y":692,"width":258,"height":12}},{"id":"58f9aa8c-1961-4404-83ed-4e5fc8a8d010","block_type":"box","text":"The Guidelines are not intended to be exhaustive. BAIS applies the Guidelines on a case-by-case","page_number":470,"box":{"x":116,"y":723,"width":726,"height":12}},{"id":"2907abaf-c7ac-4f65-a46b-b073b47de264","block_type":"box","text":"basis, in the context of the individual circumstances of each company and the specific issue under","page_number":470,"box":{"x":117,"y":738,"width":728,"height":12}},{"id":"09d88929-150e-462f-b792-a90f6e8cf677","block_type":"box","text":"review. As such, the Guidelines do not indicate how BAIS will vote in every instance. Rather, they","page_number":470,"box":{"x":117,"y":754,"width":723,"height":12}},{"id":"3cbe23e5-d73d-4c05-9605-a0899345a4d4","block_type":"box","text":"reflect our view about corporate governance issues generally, and provide insight into how we typically","page_number":470,"box":{"x":117,"y":769,"width":761,"height":12}},{"id":"0da66218-4b73-4885-9a45-373ce2da1347","block_type":"box","text":"approach issues that are commonly put to a shareholder vote. The Guidelines are reviewed annually","page_number":470,"box":{"x":116,"y":785,"width":747,"height":12}},{"id":"cf98e55b-cc4b-4fb5-851a-3f6683e56b48","block_type":"box","text":"and updated as necessary to reflect changes in market practices, developments in corporate","page_number":470,"box":{"x":116,"y":800,"width":688,"height":12}},{"id":"18ac5f1f-00ba-4be5-a01e-7f1fa9f499a7","block_type":"box","text":"governance and feedback from companies and clients. In this way, BAIS aims to maintain policies that","page_number":470,"box":{"x":116,"y":816,"width":760,"height":12}},{"id":"b7ec540c-4ccb-450d-8a60-00e263c81921","block_type":"box","text":"explain our approach to governance practices most aligned with clients’ long-term financial interests.","page_number":470,"box":{"x":116,"y":831,"width":751,"height":12}},{"id":"60dd3bd3-88d9-46c5-92f5-35b36036923a","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":470,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"cf6b7d08-bf38-452c-91d4-fa769ea1bd45","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":470,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"a1656e04-3e66-4029-8c28-9807a4a6056c","block_type":"box","text":"18","page_number":470,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"d5c1b11d-89c8-472c-95e1-a8bee6e3dab1","block_type":"box","text":"NM1026U-6004382-470/605","page_number":470,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"d4384d51-bc3d-45d1-bf13-afb78844e573","block_type":"box","text":"In certain markets, proxy voting involves logistical issues which can affect BAIS’ ability to vote such","page_number":471,"box":{"x":117,"y":87,"width":740,"height":12}},{"id":"7f817b2e-0270-406e-942c-2e104f324287","block_type":"box","text":"proxies, as well as the desirability of voting such proxies. These issues include, but are not limited to: i)","page_number":471,"box":{"x":117,"y":102,"width":768,"height":13}},{"id":"9430fc8f-3497-46c0-82b4-57afc91aea7c","block_type":"box","text":"untimely notice of shareholder meetings; ii) restrictions on a foreigner’s ability to exercise votes; iii)","page_number":471,"box":{"x":117,"y":118,"width":735,"height":12}},{"id":"deb26c5e-10f5-4904-a50c-9d0d9f2464d9","block_type":"box","text":"requirements to vote proxies in person; iv) “share-blocking” (requirements that investors who exercise","page_number":471,"box":{"x":117,"y":134,"width":759,"height":12}},{"id":"7a83079f-97f1-4aeb-b258-f4695381a73a","block_type":"box","text":"their voting rights surrender the right to dispose of their holdings from the point at which votes are","page_number":471,"box":{"x":116,"y":149,"width":728,"height":12}},{"id":"8d4c6e1a-b3fc-4cd3-a0ce-f785cd95d48d","block_type":"box","text":"submitted until after the after the shareholder meeting has occurred); v) potential difficulties in","page_number":471,"box":{"x":116,"y":165,"width":700,"height":12}},{"id":"a4c15421-2bb6-4a73-9bf3-76963cf389d1","block_type":"box","text":"translating the proxy; vi) regulatory constraints; and vii) requirements to provide local agents with","page_number":471,"box":{"x":116,"y":180,"width":723,"height":12}},{"id":"106027c5-c795-4e63-9c7d-ac66bf6af157","block_type":"box","text":"powers of attorney to facilitate voting instructions. We are not supportive of impediments to the","page_number":471,"box":{"x":117,"y":196,"width":706,"height":12}},{"id":"e037025f-42f8-4a12-bf17-93c7e423d9f4","block_type":"box","text":"exercise of voting rights such as share-blocking or overly burdensome administrative requirements.","page_number":471,"box":{"x":116,"y":211,"width":742,"height":12}},{"id":"677be768-1fae-4e3e-9f9d-5785148c2a61","block_type":"box","text":"BlackRock votes proxies in these situations on a “best-efforts” basis. In addition, BAIS may determine","page_number":471,"box":{"x":117,"y":242,"width":759,"height":12}},{"id":"b9360260-542d-457a-bca9-30ee6d8f59d9","block_type":"box","text":"that it is generally in the interests of BlackRock’s clients not to vote proxies (or not to vote our full","page_number":471,"box":{"x":116,"y":258,"width":723,"height":12}},{"id":"6750fd4a-de80-474f-ad16-de9d236d6569","block_type":"box","text":"allocation) if the costs (including but not limited to opportunity costs associated with share-blocking","page_number":471,"box":{"x":116,"y":273,"width":737,"height":12}},{"id":"9e3afebe-673b-4a7a-878d-30b35894bc30","block_type":"box","text":"constraints) associated with exercising a vote are expected to outweigh the benefit the client would","page_number":471,"box":{"x":116,"y":289,"width":739,"height":12}},{"id":"213cb72f-109a-4685-b27a-f53d56840f42","block_type":"box","text":"derive by voting on the proposal.","page_number":471,"box":{"x":116,"y":304,"width":248,"height":12}},{"id":"d4e9a500-7818-4533-88b2-e316856021fb","block_type":"box","text":"Voting Choice","page_number":471,"box":{"x":116,"y":335,"width":118,"height":12}},{"id":"354dbf88-4dd6-4ab6-b139-7caafa8cacc7","block_type":"box","text":"BlackRock offers Voting Choice, a program that provides eligible clients with more opportunities to","page_number":471,"box":{"x":117,"y":366,"width":733,"height":12}},{"id":"e54f1685-884a-47d9-99ad-41bf9d23f23e","block_type":"box","text":"participate in the proxy voting process where legally and operationally viable.","page_number":471,"box":{"x":117,"y":382,"width":575,"height":12}},{"id":"a0900b9d-366e-4912-b392-79cf15fc9a09","block_type":"box","text":"Voting Choice is currently available for eligible clients invested in certain institutional pooled funds in","page_number":471,"box":{"x":116,"y":413,"width":748,"height":12}},{"id":"590812d8-6953-4888-9b87-15d463bc1542","block_type":"box","text":"the U.S., UK, and Canada that use systematic active equity (SAE) and multi-asset strategies. In","page_number":471,"box":{"x":116,"y":428,"width":716,"height":12}},{"id":"32391210-db7e-41e0-a92a-e9060141fd24","block_type":"box","text":"addition, institutional clients in separately managed accounts (SMAs) are eligible for BlackRock Voting","page_number":471,"box":{"x":116,"y":444,"width":764,"height":12}},{"id":"e5f653a0-388d-498f-bae7-05b8ce9320f7","block_type":"box","text":"Choice regardless of their investment strategies.","page_number":471,"box":{"x":117,"y":459,"width":357,"height":12}},{"id":"75820786-a991-4937-bac6-d57dfda4f185","block_type":"box","text":"12","page_number":471,"box":{"x":477,"y":459,"width":11,"height":6}},{"id":"62ccea07-9240-41d4-8ca6-de72cf763b8c","block_type":"box","text":"As a result, the shares attributed to BlackRock in company share registers may be voted differently","page_number":471,"box":{"x":116,"y":490,"width":740,"height":12}},{"id":"39d175fc-52fe-4916-b5f9-10515a6f3525","block_type":"box","text":"depending on whether our clients have authorized BAIS to vote on their behalf, have authorized","page_number":471,"box":{"x":116,"y":506,"width":715,"height":12}},{"id":"9e025601-3ae0-4d3e-b1ad-cb484544aaa0","block_type":"box","text":"BlackRock to vote in accordance with a third-party policy, or have elected to vote shares in accordance","page_number":471,"box":{"x":117,"y":521,"width":769,"height":12}},{"id":"d0d0a96f-b3f4-4f10-b406-bec30e597884","block_type":"box","text":"with their own policy. Our clients have greater control over proxy voting because of Voting Choice.","page_number":471,"box":{"x":116,"y":537,"width":727,"height":12}},{"id":"65acc0a5-6b1a-44b2-aee1-4b82f99b20a0","block_type":"box","text":"13","page_number":471,"box":{"x":846,"y":537,"width":10,"height":6}},{"id":"21c24a8b-ee90-4632-a01d-af4f7c534912","block_type":"box","text":"Use and oversight of third-party vote services providers","page_number":471,"box":{"x":117,"y":568,"width":452,"height":12}},{"id":"dac39914-b695-40a7-884e-4a21ff1299f6","block_type":"box","text":"Third-party vote services providers — or proxy research firms — provide research and","page_number":471,"box":{"x":116,"y":599,"width":646,"height":12}},{"id":"85189ef4-aae8-4453-824b-3fd4930c7bd3","block_type":"box","text":"recommendations on proxy votes, as well as voting infrastructure. BlackRock contracts primarily with","page_number":471,"box":{"x":117,"y":614,"width":752,"height":12}},{"id":"a7fa1ae2-a8a2-41f4-a3b5-6e04fd80670d","block_type":"box","text":"the vote services provider ISS and leverages its online platform to supply research and support voting,","page_number":471,"box":{"x":116,"y":630,"width":765,"height":12}},{"id":"687f8825-a25e-4acc-b07a-6baf3b3bc121","block_type":"box","text":"record keeping, and reporting processes. We also use Glass Lewis’ research and analysis as an input","page_number":471,"box":{"x":117,"y":645,"width":761,"height":12}},{"id":"7555361d-31b6-4d8d-bb63-a8151d3c5b2d","block_type":"box","text":"into our voting process. It is important to note that, although proxy research firms provide important","page_number":471,"box":{"x":117,"y":661,"width":733,"height":12}},{"id":"f4f2a136-1f24-47d0-87f9-bad49b534012","block_type":"box","text":"data and analysis, BAIS does not rely solely on their information or follow their voting","page_number":471,"box":{"x":116,"y":676,"width":629,"height":12}},{"id":"06a55b6d-d185-4fef-b6cf-466b49b2a4b1","block_type":"box","text":"recommendations. A company’s disclosures, our engagements and voting, investment colleagues’","page_number":471,"box":{"x":117,"y":692,"width":728,"height":12}},{"id":"6c3ccd3f-41d9-4ae6-86c1-678dad2e6e3f","block_type":"box","text":"insights and our Guidelines are important inputs into our voting decisions on behalf of clients.","page_number":471,"box":{"x":117,"y":707,"width":689,"height":12}},{"id":"6f24c649-f2f1-43c1-9a7a-ec1d65c998e4","block_type":"box","text":"Given the large universe of actively held companies, BAIS employs the proxy services provider to","page_number":471,"box":{"x":117,"y":738,"width":722,"height":12}},{"id":"e29db2cd-3b80-45e2-9288-e3871b1d4af7","block_type":"box","text":"streamline the voting process by making voting recommendations based on BAIS’ Guidelines when the","page_number":471,"box":{"x":116,"y":754,"width":765,"height":12}},{"id":"97604b9c-5e19-4674-87c9-41786feacea6","block_type":"box","text":"items on a shareholder meeting agenda are routine. Agenda items that are not routine are referred","page_number":471,"box":{"x":117,"y":769,"width":730,"height":12}},{"id":"ccde00e9-3ccd-4b8f-882b-e88bd9b65f34","block_type":"box","text":"back to BAIS to assess, escalate as necessary to the relevant portfolio managers and vote. BAIS","page_number":471,"box":{"x":117,"y":785,"width":719,"height":12}},{"id":"2ea9e75d-ca9f-4a48-830b-2101f96ab0f1","block_type":"box","text":"reviews and can override the recommendations of the vote services provider at any time prior to the","page_number":471,"box":{"x":117,"y":800,"width":739,"height":12}},{"id":"bfe754f4-e9db-4466-bc84-d666d23ff091","block_type":"box","text":"12","page_number":471,"box":{"x":144,"y":841,"width":8,"height":5}},{"id":"7298ab96-1e8c-4cf7-bd79-992b1e93368b","block_type":"box","text":"With Voting Choice, SMAs have the ability to select from a set of voting policies from third-party proxy advisers the","page_number":471,"box":{"x":170,"y":841,"width":679,"height":9}},{"id":"716f3e8e-a22e-4e30-97d4-a04e3b00b26a","block_type":"box","text":"policy that best aligns with their views and preferences. BlackRock can then use its proxy voting infrastructure to cast","page_number":471,"box":{"x":170,"y":854,"width":695,"height":9}},{"id":"a77ad5b4-873d-480a-a89a-7eff5048fa8b","block_type":"box","text":"votes based on the client’s selected voting policy.","page_number":471,"box":{"x":170,"y":867,"width":292,"height":9}},{"id":"8f1e44eb-2c48-43cb-ad93-011a09ee3caf","block_type":"box","text":"13","page_number":471,"box":{"x":144,"y":880,"width":8,"height":5}},{"id":"dc19a906-d56b-4d19-8cde-6542dfb4ea5e","block_type":"box","text":"BlackRock does not disclose client information, including a client’s selection of proxy policy, without client consent.","page_number":471,"box":{"x":171,"y":880,"width":678,"height":9}},{"id":"364f7184-62f8-42a3-aab9-fbafee986332","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":471,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"5668f4fc-588d-4218-ba1b-66155bee599c","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":471,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"f9a8e8bc-ca24-428e-a5d3-94cec9457426","block_type":"box","text":"19","page_number":471,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"9972e63f-3e71-4b99-a8d5-ea701ef3f9c5","block_type":"box","text":"NM1026U-6004382-471/605","page_number":471,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4ed1cc73-97d2-4eb5-98b9-f229078e21ec","block_type":"box","text":"vote deadline. Both BAIS and the vote services provider actively monitor securities filings, research","page_number":472,"box":{"x":116,"y":87,"width":741,"height":12}},{"id":"86f2ddaf-6ef5-41e8-b40a-7ab293fb4134","block_type":"box","text":"reports, company announcements, and direct communications from companies to ensure awareness","page_number":472,"box":{"x":117,"y":102,"width":753,"height":13}},{"id":"1af0cf08-ef7a-436a-ac5e-c3cbbf5e4bf6","block_type":"box","text":"of supplemental disclosures and proxy materials that may require a modification of votes.","page_number":472,"box":{"x":116,"y":118,"width":667,"height":12}},{"id":"03c12680-f890-4126-a1e6-abbd4dbd11f2","block_type":"box","text":"BAIS closely monitors the third-party vote services providers we contract with to ensure that they are","page_number":472,"box":{"x":117,"y":149,"width":751,"height":12}},{"id":"22ca666e-ccf4-45cf-88cf-e39ebab682c8","block_type":"box","text":"meeting our service level expectations and have effective policies and procedures in place to manage","page_number":472,"box":{"x":117,"y":165,"width":759,"height":12}},{"id":"6320ef13-f3cf-42b9-9e54-f23e1f05bad8","block_type":"box","text":"potential conflicts of interest. Our oversight of service providers includes regular meetings with client","page_number":472,"box":{"x":117,"y":180,"width":747,"height":12}},{"id":"e48109f8-8dde-4c6e-84ed-a3fd5a99ac23","block_type":"box","text":"service teams, systematic monitoring of vendor operations, as well as annual due diligence meetings in","page_number":472,"box":{"x":116,"y":196,"width":771,"height":12}},{"id":"77ee8abf-aebf-44ce-a12a-fbda0260f8c3","block_type":"box","text":"accordance with BlackRock’s firmwide policies.","page_number":472,"box":{"x":116,"y":211,"width":355,"height":12}},{"id":"c14b6fcc-13eb-42df-bf13-290acfba7306","block_type":"box","text":"Conflicts management policies and procedures","page_number":472,"box":{"x":116,"y":242,"width":383,"height":12}},{"id":"b3b1a25c-fd0b-428b-b298-2b0513fa8ed7","block_type":"box","text":"BlackRock maintains policies and procedures that seek to prevent undue influence on BAIS’ proxy","page_number":472,"box":{"x":117,"y":273,"width":734,"height":12}},{"id":"8b3249ee-8ff0-4a8b-a59f-91e70d37e699","block_type":"box","text":"voting activity. Such influence might stem from any relationship between the investee company (or any","page_number":472,"box":{"x":116,"y":289,"width":767,"height":12}},{"id":"77d6868e-8e08-4198-8db6-6363866f6a31","block_type":"box","text":"shareholder proponent or dissident shareholder) and BlackRock, BlackRock’s affiliates, a Fund or a","page_number":472,"box":{"x":116,"y":304,"width":743,"height":12}},{"id":"e2d6157c-f330-42c3-91e1-c2358ab6cdfe","block_type":"box","text":"Fund’s affiliates, or BlackRock employees. 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BlackRock may also use an independent third-party voting service provider to","page_number":473,"box":{"x":184,"y":196,"width":701,"height":12}},{"id":"441fcec7-3caf-497e-933e-8310b72c3995","block_type":"box","text":"make proxy voting recommendations for certain perceived or potential conflicts of interest,","page_number":473,"box":{"x":184,"y":211,"width":673,"height":12}},{"id":"b38d7390-b293-4de5-9cdf-ccf96a0019f8","block_type":"box","text":"including:","page_number":473,"box":{"x":184,"y":227,"width":75,"height":12}},{"id":"90a7a710-7768-4002-aaf1-d7bc1a8107eb","block_type":"box","text":"• public companies that include BlackRock employees on their boards of directors","page_number":473,"box":{"x":226,"y":250,"width":625,"height":12}},{"id":"0273047d-16b3-4f8f-aaf7-93eb41b28d95","block_type":"box","text":"• public companies of which a BlackRock, Inc. board member serves as a senior","page_number":473,"box":{"x":226,"y":273,"width":616,"height":12}},{"id":"339ab29a-6a82-494d-aa0b-50aea7675e73","block_type":"box","text":"executive or a member of the board of directors","page_number":473,"box":{"x":251,"y":289,"width":358,"height":9}},{"id":"e497fbdd-47c4-4c06-96d3-e2369a2971fa","block_type":"box","text":"• public companies that are the subject of certain transactions involving BlackRock","page_number":473,"box":{"x":226,"y":312,"width":631,"height":12}},{"id":"bf483ba7-1327-42d0-ae96-42a0b2563ce5","block_type":"box","text":"Funds","page_number":473,"box":{"x":252,"y":327,"width":50,"height":10}},{"id":"f9c13d0e-5597-497a-82e4-af03e65acd88","block_type":"box","text":"• public companies that are joint venture partners with BlackRock, and","page_number":473,"box":{"x":226,"y":351,"width":540,"height":12}},{"id":"bdfef29c-856d-4dae-86d5-21bb74680fa8","block_type":"box","text":"• public companies when legal or regulatory requirements compel BlackRock to use","page_number":473,"box":{"x":226,"y":374,"width":640,"height":12}},{"id":"cb55769b-9402-4e15-b286-bc3235028d4b","block_type":"box","text":"an independent third-party voting service provider","page_number":473,"box":{"x":251,"y":389,"width":374,"height":12}},{"id":"4b08ffd4-7555-4a1f-b865-ee397128b25d","block_type":"box","text":"In selecting an independent third-party voting service provider, we assess several characteristics,","page_number":473,"box":{"x":117,"y":420,"width":727,"height":12}},{"id":"351a3507-a004-4fdd-8d01-9c739a1c8315","block_type":"box","text":"including but not limited to: independence, an ability to analyze proxy issues and make","page_number":473,"box":{"x":117,"y":436,"width":647,"height":12}},{"id":"094c224b-fee7-48bd-b412-72af265bf1d9","block_type":"box","text":"recommendations in the economic interest of our clients in accordance with the Guidelines, reputation","page_number":473,"box":{"x":117,"y":451,"width":760,"height":12}},{"id":"dc4efafe-a13f-4302-9f7d-255422689a65","block_type":"box","text":"for reliability and integrity, and operational capacity to accurately deliver the assigned","page_number":473,"box":{"x":116,"y":467,"width":637,"height":12}},{"id":"d2a18d31-dbc6-46da-ae7f-6cf726e1fc81","block_type":"box","text":"recommendations in a timely manner. We may engage more than one independent third-party voting","page_number":473,"box":{"x":117,"y":482,"width":752,"height":12}},{"id":"092d3247-0824-41a1-999e-6b2b23f1390a","block_type":"box","text":"service provider, in part to mitigate potential or perceived conflicts of interest at a single voting service","page_number":473,"box":{"x":116,"y":498,"width":761,"height":12}},{"id":"cadf6ee3-5b4c-40af-8775-e54c035f16df","block_type":"box","text":"provider.","page_number":473,"box":{"x":117,"y":514,"width":69,"height":11}},{"id":"dafea7cd-6583-453a-8937-7a8d57ed631d","block_type":"box","text":"Securities lending","page_number":473,"box":{"x":116,"y":544,"width":149,"height":12}},{"id":"6c6d1d20-1379-4168-9b06-53b6ce18288d","block_type":"box","text":"If authorized, BlackRock acts as a securities lending agent on behalf of its clients. 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While","page_number":473,"box":{"x":116,"y":668,"width":762,"height":12}},{"id":"91fe73e8-5247-43fe-a239-5e0cdb9cba10","block_type":"box","text":"this has occurred in a limited number of cases, the decision to recall securities on loan as part of","page_number":473,"box":{"x":116,"y":684,"width":716,"height":12}},{"id":"24a971f4-cd9b-4dcd-bafb-e23875199cc6","block_type":"box","text":"BlackRock’s securities lending program in order to vote is based on an evaluation of various factors","page_number":473,"box":{"x":117,"y":699,"width":737,"height":13}},{"id":"753cd605-3e87-4438-8bd2-208cc9154920","block_type":"box","text":"that include, but are not limited to, assessing potential securities lending revenue alongside the","page_number":473,"box":{"x":116,"y":715,"width":704,"height":12}},{"id":"6a7fedd7-24e5-4a13-b0f9-e24f83b04bb3","block_type":"box","text":"potential long-term financial value to clients of voting those securities (based on the information","page_number":473,"box":{"x":117,"y":730,"width":705,"height":13}},{"id":"3618e298-2d5e-43b3-8ad6-9382babe1c83","block_type":"box","text":"available at the time of recall consideration). 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However, in certain instances, BlackRock","page_number":473,"box":{"x":116,"y":824,"width":758,"height":12}},{"id":"bd482eae-ae62-4c85-b6ce-457881f8eb07","block_type":"box","text":"may determine, in our independent business judgment as a fiduciary, that the value of voting","page_number":473,"box":{"x":117,"y":839,"width":691,"height":12}},{"id":"11959749-6766-4143-821c-a5c11dc96e8b","block_type":"box","text":"outweighs the securities lending revenue loss to clients and would therefore recall shares to be voted","page_number":473,"box":{"x":116,"y":854,"width":756,"height":13}},{"id":"7247ab0c-fd00-43ef-b41e-f65457b2587b","block_type":"box","text":"in those instances.","page_number":473,"box":{"x":117,"y":870,"width":143,"height":9}},{"id":"e892480f-9152-4605-bf9c-d1fc81dbbc6b","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":473,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"2ac66fff-18d4-4720-91d7-f60c260ccbc7","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":473,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"7a1504df-a8c2-4ec6-8e8b-8e68f6b3c82d","block_type":"box","text":"21","page_number":473,"box":{"x":865,"y":909,"width":16,"height":9}},{"id":"c3645f59-e106-45bf-8edb-2e8d97594b8e","block_type":"box","text":"NM1026U-6004382-473/605","page_number":473,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9b16fb88-f56f-4b76-b286-c2df49c8dcee","block_type":"box","text":"Periodically, BlackRock reviews our process for determining whether to recall securities on loan in","page_number":474,"box":{"x":117,"y":87,"width":731,"height":12}},{"id":"05c61059-054e-45b3-8e0a-1ca7223d86fa","block_type":"box","text":"order to vote and may modify it as necessary.","page_number":474,"box":{"x":116,"y":102,"width":344,"height":13}},{"id":"1b8ad7e7-7d51-44da-a170-8950c865b166","block_type":"box","text":"Reporting and vote transparency","page_number":474,"box":{"x":117,"y":134,"width":267,"height":12}},{"id":"ac75a635-a127-4e06-8dfa-af5e1604b826","block_type":"box","text":"BAIS is committed to transparency in the stewardship work we do on behalf of clients. 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The Guidelines set forth BlackRock’s approach to","page_number":477,"box":{"x":117,"y":211,"width":733,"height":12}},{"id":"fc28f382-b576-4448-9239-259d725d4f59","block_type":"box","text":"recalling securities on loan in connection with proxy voting.","page_number":477,"box":{"x":117,"y":227,"width":440,"height":12}},{"id":"262ee644-c1ba-4bbb-9f90-38dc5403c012","block_type":"box","text":"Reports to the Board","page_number":477,"box":{"x":117,"y":258,"width":171,"height":11}},{"id":"4b9ac7c4-0463-4e98-9e90-878891907390","block_type":"box","text":"BlackRock will report on an annual basis to the Directors on (1) a summary of the proxy voting process","page_number":477,"box":{"x":117,"y":281,"width":767,"height":12}},{"id":"bc470c02-0689-4014-bef1-bab60d92ab4c","block_type":"box","text":"as applicable to the Funds covered by this policy in the preceding year together with a 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As a fiduciary, BlackRock is legally required to make proxy voting","page_number":482,"box":{"x":116,"y":382,"width":663,"height":12}},{"id":"5572c518-4227-49a6-a0a1-723ddba6f418","block_type":"box","text":"determinations in a manner that is consistent with the investment objectives of clients who have","page_number":482,"box":{"x":116,"y":397,"width":715,"height":12}},{"id":"a9d13082-3286-498f-b2f7-220a46a7169c","block_type":"box","text":"delegated voting authority to us. BIS’ Benchmark Policies, and the vote decisions made consistent with","page_number":482,"box":{"x":116,"y":413,"width":770,"height":12}},{"id":"942414a6-ccec-41f9-a51e-6a59320cbee0","block_type":"box","text":"those policies, reflect our reasonable and independent judgment of what is in the long-term financial","page_number":482,"box":{"x":116,"y":428,"width":746,"height":12}},{"id":"d3126c6c-d38a-432c-835f-feb15f08cb0c","block_type":"box","text":"interests of clients. Our vote decisions are often informed by several factors, including in-depth","page_number":482,"box":{"x":117,"y":444,"width":706,"height":12}},{"id":"9a3b45a7-c229-42ee-97f4-06a7ffcc11b6","block_type":"box","text":"analysis of company disclosures, comparisons against industry peers, third-party research, and, where","page_number":482,"box":{"x":116,"y":459,"width":768,"height":12}},{"id":"4715005d-79d3-49af-ac6c-fa2b955515b6","block_type":"box","text":"appropriate, engagement with companies.","page_number":482,"box":{"x":116,"y":475,"width":318,"height":12}},{"id":"e5f4fec3-0566-4622-9d85-1874ae15a706","block_type":"box","text":"Generally, BIS supports the vote recommendations of the board of directors and management at","page_number":482,"box":{"x":117,"y":506,"width":721,"height":12}},{"id":"4db73265-790e-4aa4-8ce3-8820272b8b4d","block_type":"box","text":"companies which have sound corporate governance and deliver strong financial returns over time.","page_number":482,"box":{"x":116,"y":521,"width":734,"height":12}},{"id":"894b1b30-8b9a-4198-9f3a-c3944e38dc9a","block_type":"box","text":"When we determine it is in our clients’ financial interests to convey concern to companies through","page_number":482,"box":{"x":116,"y":537,"width":729,"height":12}},{"id":"f8478b32-ddd9-4d5f-84be-b1e28c17324c","block_type":"box","text":"voting, we may do so in two forms: we might not support the election of directors or other management","page_number":482,"box":{"x":116,"y":552,"width":768,"height":12}},{"id":"be2882dd-e801-4358-a487-43d5e595a5b7","block_type":"box","text":"proposals, or we might not support management’s voting recommendation on a shareholder proposal.","page_number":482,"box":{"x":117,"y":568,"width":761,"height":12}},{"id":"2ea5e631-67d6-4fc2-a4f2-287a892e34d6","block_type":"box","text":"Shareholder rights","page_number":482,"box":{"x":425,"y":606,"width":154,"height":12}},{"id":"147d585a-ca60-4216-9002-b6c7210f210b","block_type":"box","text":"BlackRock’s global approach as a shareholder on behalf of our clients is underpinned by certain rights","page_number":482,"box":{"x":117,"y":637,"width":762,"height":12}},{"id":"d3193dbb-80b5-471c-bd6f-de0f43a02dbf","block_type":"box","text":"attached to shareholding in most markets, as established by corporate laws, regulations, and listing","page_number":482,"box":{"x":116,"y":653,"width":743,"height":12}},{"id":"5985ef27-e2c7-4d5e-84e9-656a356ce5ec","block_type":"box","text":"rules.","page_number":482,"box":{"x":117,"y":669,"width":38,"height":9}},{"id":"1f98a917-f60c-4d16-9172-f592b7c4d9b8","block_type":"box","text":"3","page_number":482,"box":{"x":157,"y":669,"width":5,"height":6}},{"id":"a539447d-ac2b-4b9d-b069-7e1bfd8744dd","block_type":"box","text":"For example, in most markets, shareholders have the right to:","page_number":482,"box":{"x":169,"y":669,"width":456,"height":11}},{"id":"aa3d0e23-57c8-40ed-bbed-35af5bd9df3e","block_type":"box","text":"• Vote to elect, remove, and nominate directors, approve the appointment of the auditor, and","page_number":482,"box":{"x":159,"y":699,"width":699,"height":12}},{"id":"0cb9d232-faa3-4f33-b5f2-05bb7bd15d35","block_type":"box","text":"amend the corporate charter or bylaws.","page_number":482,"box":{"x":184,"y":715,"width":291,"height":12}},{"id":"e41a368d-2264-46ab-aa60-319fa0ad0d2c","block_type":"box","text":"• Vote on key board decisions that are material to the protection of their investment, including","page_number":482,"box":{"x":159,"y":738,"width":704,"height":12}},{"id":"2bb31da6-ec8e-4207-8c41-f5ef03e07d31","block_type":"box","text":"but not limited to, changes to the purpose of the business, dilution levels, and pre-emptive","page_number":482,"box":{"x":184,"y":754,"width":667,"height":12}},{"id":"b588893d-cf41-48a6-95b3-1b237f4adca3","block_type":"box","text":"rights.","page_number":482,"box":{"x":184,"y":769,"width":43,"height":12}},{"id":"d9a61131-3d54-4bf5-be7c-d26ae990076d","block_type":"box","text":"• Access sufficient and timely information on governance, strategic, and business matters –","page_number":482,"box":{"x":159,"y":792,"width":691,"height":13}},{"id":"11e2efc0-0acf-4ab1-a0de-ebc2c13e3ec9","block_type":"box","text":"where such matters are material – to make informed decisions.","page_number":482,"box":{"x":183,"y":808,"width":468,"height":9}},{"id":"82f8e611-11c1-4d3b-910c-4393d05a9478","block_type":"box","text":"3","page_number":482,"box":{"x":143,"y":854,"width":4,"height":5}},{"id":"1b0393d4-a27e-4246-8845-723eaaf3eb8d","block_type":"box","text":"Examples include: Government of Canada, “Canada Business Corporations Act,” amended 2024; European Union,","page_number":482,"box":{"x":171,"y":854,"width":682,"height":9}},{"id":"3e5a21e0-4c56-4799-a48c-fed8e63a7bd9","block_type":"box","text":"“Shareholder Rights Directive II,” 2017; and the China Securities Regulatory Commission, “Code of Corporate","page_number":482,"box":{"x":170,"y":867,"width":651,"height":9}},{"id":"e37acc83-3a9d-4537-a915-537a6858c2be","block_type":"box","text":"Governance for Listed Companies in China,” 2001. Websites accessed in December 2025.","page_number":482,"box":{"x":170,"y":880,"width":538,"height":9}},{"id":"0d9f5c95-c2f9-47d8-b1d8-9edb72129324","block_type":"box","text":"BlackRock Investment Stewardship","page_number":482,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"f4bba1a7-c3b1-4ebc-b0bf-741f65ff8592","block_type":"box","text":"Global Principles |","page_number":482,"box":{"x":735,"y":909,"width":133,"height":12}},{"id":"8f53c084-50ed-4333-ac3f-1b21905ef4e3","block_type":"box","text":"4","page_number":482,"box":{"x":874,"y":909,"width":9,"height":9}},{"id":"0e3b2d1a-1c67-4c37-a3ad-91293daada2f","block_type":"box","text":"NM1026U-6004382-482/605","page_number":482,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6f9538f3-f24b-4acf-adcc-38d8b59caaaa","block_type":"box","text":"Key governance topics","page_number":483,"box":{"x":409,"y":87,"width":187,"height":12}},{"id":"60946965-ab02-4ee4-9ce5-815289c09373","block_type":"box","text":"In our experience, there are certain globally applicable elements of corporate governance that","page_number":483,"box":{"x":117,"y":118,"width":700,"height":12}},{"id":"ec957306-d9c8-4d97-a475-da3a1fba1fe4","block_type":"box","text":"contribute to a company’s ability to create long-term financial value for shareholders. These are topics","page_number":483,"box":{"x":116,"y":134,"width":761,"height":12}},{"id":"3b9e5dac-03b7-4259-9d53-ec5ba6f1aa7d","block_type":"box","text":"that shareholders may have the ability to vote on at shareholder meetings. These areas include:","page_number":483,"box":{"x":116,"y":149,"width":717,"height":12}},{"id":"682b3982-103b-4d35-9322-22bd9010e6cf","block_type":"box","text":"• Boards and directors","page_number":483,"box":{"x":117,"y":180,"width":192,"height":10}},{"id":"91c01d93-0363-441c-9a83-ad2b9e425771","block_type":"box","text":"• Auditors and audit-related issues","page_number":483,"box":{"x":117,"y":203,"width":282,"height":10}},{"id":"709f1a27-52ec-403b-827c-abcde6b33fb8","block_type":"box","text":"• Capital structure, mergers, acquisitions, asset sales, and other special situations","page_number":483,"box":{"x":117,"y":227,"width":635,"height":12}},{"id":"ae7a8180-09d7-4d8a-bcbc-ce7c338d1bb6","block_type":"box","text":"• Executive compensation","page_number":483,"box":{"x":117,"y":250,"width":219,"height":12}},{"id":"ad685307-4b18-42da-90ce-e940bdb42e41","block_type":"box","text":"• Shareholder protections and other significant corporate governance matters","page_number":483,"box":{"x":117,"y":273,"width":600,"height":12}},{"id":"3c24de70-0099-4eba-9fd2-57be37613c7c","block_type":"box","text":"• Shareholder proposals","page_number":483,"box":{"x":117,"y":296,"width":206,"height":12}},{"id":"358d8032-98ce-4e91-9265-6195f0bc526f","block_type":"box","text":"The BIS Benchmark Policies are not prescriptive but rather are applied on a pragmatic basis, taking","page_number":483,"box":{"x":116,"y":327,"width":744,"height":12}},{"id":"95c8c6ed-fabc-4581-84f3-4c2215276bdb","block_type":"box","text":"into consideration a number of company-specific factors, including the sector, market, and business","page_number":483,"box":{"x":117,"y":343,"width":744,"height":12}},{"id":"6916ac58-3d2c-4837-9b70-0a2e462f2086","block_type":"box","text":"environment within which companies operate.","page_number":483,"box":{"x":116,"y":358,"width":345,"height":12}},{"id":"885039c6-a0c6-4c58-96e1-cd79c034ea12","block_type":"box","text":"At the regional level, it is our view that companies should observe the accepted corporate governance","page_number":483,"box":{"x":116,"y":389,"width":761,"height":12}},{"id":"c332cdae-d065-4dcf-ba43-9a2050c04b4c","block_type":"box","text":"standards in their domestic market at a minimum, and we ask that, if they do not, they explain how","page_number":483,"box":{"x":116,"y":405,"width":736,"height":12}},{"id":"3514a2b4-820b-4a3e-a21c-9bcd35d2a260","block_type":"box","text":"their approach better supports durable, long-term financial value creation. Our regional voting","page_number":483,"box":{"x":116,"y":420,"width":698,"height":12}},{"id":"4c191e92-f057-4a2f-8a24-2484bebb4bdb","block_type":"box","text":"guidelines explain how the BIS Global Principles inform our voting decisions in relation to common","page_number":483,"box":{"x":116,"y":436,"width":735,"height":12}},{"id":"664b55c2-d5da-4614-8c3e-428598ec0cce","block_type":"box","text":"ballot items for shareholder meetings in those markets.","page_number":483,"box":{"x":117,"y":451,"width":406,"height":12}},{"id":"02656888-7594-4dd8-946c-5130f3dea924","block_type":"box","text":"4","page_number":483,"box":{"x":525,"y":451,"width":5,"height":7}},{"id":"09d18c2c-04db-4fa4-93d5-bd2beacae120","block_type":"box","text":"Boards and directors","page_number":483,"box":{"x":416,"y":490,"width":173,"height":10}},{"id":"6047e00b-1b01-4fec-9cb8-0ad4603f767d","block_type":"box","text":"Oversight role of the board","page_number":483,"box":{"x":116,"y":521,"width":221,"height":12}},{"id":"5a2b0e99-8742-4313-a2d6-6f097aabdbd5","block_type":"box","text":"Companies whose boards are comprised of appropriately qualified, engaged directors with","page_number":483,"box":{"x":117,"y":552,"width":676,"height":12}},{"id":"231b8515-ebe1-44d5-be9b-ec68a1905e4a","block_type":"box","text":"professional characteristics relevant to a company’s business enhance the board’s ability to add long","page_number":483,"box":{"x":117,"y":568,"width":753,"height":12}},{"id":"bef1e1dd-f58e-473c-825f-b121f7965872","block_type":"box","text":"term financial value and serve as the voice of shareholders in board discussions. In our view, a strong","page_number":483,"box":{"x":116,"y":583,"width":761,"height":12}},{"id":"483f6cfa-24cc-4136-a777-12980dea4b5a","block_type":"box","text":"board gives a company a competitive advantage, providing valuable oversight and contributing to the","page_number":483,"box":{"x":117,"y":599,"width":754,"height":12}},{"id":"4e4304bf-364e-4ba8-a4e6-6c3c1899d298","block_type":"box","text":"most important management decisions that support long-term financial performance.","page_number":483,"box":{"x":117,"y":614,"width":632,"height":12}},{"id":"e38c83ab-a27f-47fa-b1b8-6007cd9db24f","block_type":"box","text":"For this reason, our investment stewardship efforts focus on the effectiveness of the board of directors.","page_number":483,"box":{"x":117,"y":645,"width":768,"height":12}},{"id":"888e720b-836d-45e9-9015-b4010f175e27","block_type":"box","text":"We engage, as necessary, with members of the board’s nominating and/or governance committee to","page_number":483,"box":{"x":116,"y":661,"width":748,"height":12}},{"id":"4d9249e6-bafd-463d-81aa-32a24355f85a","block_type":"box","text":"assess whether governance practices and board composition are effective given a company’s","page_number":483,"box":{"x":116,"y":676,"width":696,"height":12}},{"id":"318e5805-4fee-4dfd-9438-5649873dc475","block_type":"box","text":"business model, sector, market, and the business environment in which a company is operating.","page_number":483,"box":{"x":117,"y":692,"width":713,"height":12}},{"id":"2f634b96-d1b3-4351-8f26-dffd875de598","block_type":"box","text":"We consider it good practice when the board establishes and maintains a framework of robust and","page_number":483,"box":{"x":116,"y":723,"width":730,"height":12}},{"id":"d817368a-856b-4239-a3bb-90e56333258e","block_type":"box","text":"effective governance mechanisms that supports its oversight of the company’s strategy and","page_number":483,"box":{"x":116,"y":738,"width":679,"height":12}},{"id":"90962b52-63ef-401b-8088-ea5034f028b3","block_type":"box","text":"operations, consistent with the long-term financial interests of investors. This includes having clear","page_number":483,"box":{"x":116,"y":754,"width":731,"height":12}},{"id":"6012ecfa-8d19-4f36-8bf7-3a7b594988ea","block_type":"box","text":"descriptions of the role of the board and the committees of the board and how directors engage with","page_number":483,"box":{"x":116,"y":769,"width":742,"height":12}},{"id":"fde7dcc5-3260-4ff5-9d01-23dbb9e613cb","block_type":"box","text":"and oversee management, as well as disclosure of material risks that may affect a company’s long","page_number":483,"box":{"x":116,"y":785,"width":738,"height":12}},{"id":"f822562c-78ac-4468-81bb-629c89c6b369","block_type":"box","text":"term strategy and how management is effectively identifying, managing, and mitigating such risks.","page_number":483,"box":{"x":116,"y":800,"width":726,"height":12}},{"id":"d3ec7179-2876-4217-b1b8-ada112e5a568","block_type":"box","text":"4","page_number":483,"box":{"x":143,"y":841,"width":4,"height":5}},{"id":"4eaa6e3b-eb02-418f-8da5-87301f88237c","block_type":"box","text":"Our regional voting guidelines reflect these different market standards and norms. Depending on the market, generally","page_number":483,"box":{"x":170,"y":841,"width":702,"height":9}},{"id":"8bc789eb-7bab-4b55-9da0-50a83d283909","block_type":"box","text":"accepted practice is informed by corporate law, market regulation, best practices, and industry initiatives, amongst other","page_number":483,"box":{"x":170,"y":854,"width":712,"height":9}},{"id":"f978190c-6b95-4f38-91e8-65e488e36dc6","block_type":"box","text":"factors. BIS carries out engagement with companies, executes proxy votes, and conducts vote operations (including","page_number":483,"box":{"x":170,"y":867,"width":688,"height":9}},{"id":"b1916801-8e15-495a-b804-fcc51db1a9f4","block_type":"box","text":"maintaining records of votes cast) in a manner consistent with the relevant regional voting guidelines.","page_number":483,"box":{"x":170,"y":880,"width":600,"height":9}},{"id":"78590bdf-f282-4996-8358-0633e389b166","block_type":"box","text":"BlackRock Investment Stewardship","page_number":483,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"6413516c-604b-4921-8678-b13f35fb7ea9","block_type":"box","text":"Global Principles |","page_number":483,"box":{"x":735,"y":909,"width":133,"height":12}},{"id":"65b75298-18eb-4475-bab1-38447a018116","block_type":"box","text":"5","page_number":483,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"920a6d28-474a-43f7-b7aa-3ea0560cad2b","block_type":"box","text":"NM1026U-6004382-483/605","page_number":483,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"70457b81-b462-4dd8-bffd-b07e7b75ad59","block_type":"box","text":"Understanding management’s long-term strategy and the milestones against which investors should","page_number":484,"box":{"x":117,"y":87,"width":747,"height":12}},{"id":"bdcc91cc-5a7d-4f42-86bc-25afb9896037","block_type":"box","text":"assess its implementation is central to our approach. If any strategic targets are significantly missed or","page_number":484,"box":{"x":116,"y":102,"width":765,"height":13}},{"id":"e88537a9-bc1e-4beb-8796-c19c9fb6c469","block_type":"box","text":"materially restated, we find it helpful when company disclosures provide a detailed explanation of the","page_number":484,"box":{"x":117,"y":118,"width":753,"height":12}},{"id":"1cc821c2-7b0c-417d-937a-34aea18d0b55","block_type":"box","text":"changes and an indication of the board’s role in reviewing the revised targets. We look to the board to","page_number":484,"box":{"x":116,"y":134,"width":759,"height":12}},{"id":"dbd33b4b-1d8b-4b98-b1e1-48c9039f9b98","block_type":"box","text":"articulate the effectiveness of these mechanisms in overseeing the management of business risks and","page_number":484,"box":{"x":116,"y":149,"width":765,"height":12}},{"id":"8d8376e2-4720-4e09-8777-3c5b294f026d","block_type":"box","text":"opportunities and the fulfillment of the company’s strategy.","page_number":484,"box":{"x":116,"y":165,"width":439,"height":12}},{"id":"8cf64804-486e-4477-ac04-a80b646ff546","block_type":"box","text":"Where a company has not adequately disclosed or demonstrated that its board has fulfilled these","page_number":484,"box":{"x":116,"y":196,"width":727,"height":12}},{"id":"eb2c212d-e0d2-4e21-8403-54a8a206e546","block_type":"box","text":"corporate governance and risk oversight responsibilities, we may consider not supporting the election","page_number":484,"box":{"x":116,"y":211,"width":757,"height":12}},{"id":"9ddce08c-c763-4ef1-a9df-635329415f35","block_type":"box","text":"of directors who, in our assessment, have particular responsibility for the issues.","page_number":484,"box":{"x":116,"y":227,"width":601,"height":12}},{"id":"a7baffc4-1898-4164-9678-3b32a2e655f9","block_type":"box","text":"When casting vote decisions on behalf of clients on the election of directors, some of the factors that","page_number":484,"box":{"x":116,"y":258,"width":750,"height":12}},{"id":"9704ca10-8ace-40b1-8a3e-80e2e5e5e413","block_type":"box","text":"speak to the board’s effectiveness as a group include the relevance of individual directors’","page_number":484,"box":{"x":116,"y":273,"width":673,"height":12}},{"id":"b336894d-9843-4ae0-a312-6fe67ee93187","block_type":"box","text":"qualifications and skillsets, as well as directors’ capacity and other time commitments, and how these","page_number":484,"box":{"x":116,"y":289,"width":757,"height":12}},{"id":"ef5b60f3-9aba-4db6-81a4-731a2c5759ad","block_type":"box","text":"factors may contribute to the company’s financial performance. We look to boards to establish formal","page_number":484,"box":{"x":116,"y":304,"width":754,"height":12}},{"id":"cf762089-a0d1-4aca-85bc-1ace2bd0306a","block_type":"box","text":"and transparent processes for nominating directors that reflect the company’s long-term strategy and","page_number":484,"box":{"x":116,"y":320,"width":754,"height":12}},{"id":"c86902a4-1f37-4ddc-bce1-6dc9e5653cc1","block_type":"box","text":"business model.","page_number":484,"box":{"x":117,"y":335,"width":125,"height":10}},{"id":"121db251-7227-4f61-af17-f5c11ec98157","block_type":"box","text":"In the section titled “Board quality and effectiveness” below, we provide more detail about our","page_number":484,"box":{"x":117,"y":366,"width":697,"height":12}},{"id":"40160e5a-66ee-45d0-9305-3cb01ea88286","block_type":"box","text":"approach to board composition and how it underpins board effectiveness and long-term financial value","page_number":484,"box":{"x":116,"y":382,"width":766,"height":12}},{"id":"6d182645-387a-41c5-9c5c-eba7e3723f91","block_type":"box","text":"creation.","page_number":484,"box":{"x":116,"y":397,"width":69,"height":10}},{"id":"1522face-8e17-4e9a-9d87-813a47d95a14","block_type":"box","text":"Regular accountability through director elections","page_number":484,"box":{"x":116,"y":428,"width":398,"height":12}},{"id":"813c55a1-e184-414c-a315-685f47d9fd21","block_type":"box","text":"The election of directors to the board is a right of shareholders and an important signal of support for,","page_number":484,"box":{"x":116,"y":459,"width":756,"height":12}},{"id":"9ceea666-b03f-47bc-bd5d-05fcb1ba0d0e","block_type":"box","text":"or concern about, the performance of the board in overseeing and advising management. To ensure","page_number":484,"box":{"x":116,"y":475,"width":749,"height":12}},{"id":"d02d1012-23ce-4156-9581-03ea315c6a02","block_type":"box","text":"accountability for their decisions on behalf of shareholders, directors should stand for election on a","page_number":484,"box":{"x":116,"y":490,"width":736,"height":12}},{"id":"aadb6eb2-8eca-4c9a-950e-81680124c926","block_type":"box","text":"regular basis, ideally annually.","page_number":484,"box":{"x":117,"y":506,"width":223,"height":12}},{"id":"db77e40c-1247-43f9-92a0-6c46a38a0b2a","block_type":"box","text":"5","page_number":484,"box":{"x":341,"y":506,"width":6,"height":6}},{"id":"90452f6c-9ee7-400c-97a8-22488dba60b3","block_type":"box","text":"Annual director elections allow shareholders to reaffirm their support","page_number":484,"box":{"x":347,"y":506,"width":517,"height":12}},{"id":"64d420a8-0888-48a3-b01a-82fc905676b5","block_type":"box","text":"for, or concerns about, board members’ decisions in a timely manner. When board members are not","page_number":484,"box":{"x":116,"y":521,"width":749,"height":12}},{"id":"4c211dde-0a74-4341-b5bf-b2d1ae794e57","block_type":"box","text":"elected annually, we consider it good practice for boards to have a rotation policy to ensure that,","page_number":484,"box":{"x":116,"y":537,"width":719,"height":12}},{"id":"c01f7596-ed28-4853-9651-1e9d4c75be46","block_type":"box","text":"through a board cycle, all directors have had their appointment re-confirmed, with a proportion of","page_number":484,"box":{"x":116,"y":552,"width":722,"height":12}},{"id":"9c9d387f-4fed-4818-89e6-dad39bc17755","block_type":"box","text":"directors being put forward for election at each shareholder meeting.","page_number":484,"box":{"x":116,"y":568,"width":513,"height":12}},{"id":"e0fe7279-19b2-43cb-9307-0ef7e40a3368","block_type":"box","text":"Board quality and effectiveness","page_number":484,"box":{"x":116,"y":599,"width":258,"height":12}},{"id":"0a8e01a7-b581-44d5-b7ed-50fe73eb747e","block_type":"box","text":"Regular director elections also give boards the opportunity to adjust their composition in an orderly way","page_number":484,"box":{"x":117,"y":630,"width":770,"height":12}},{"id":"0b364c8c-0a63-4ac7-8d85-ba08fb943a17","block_type":"box","text":"to reflect developments in the company’s strategy and the market environment. In our view, it is","page_number":484,"box":{"x":116,"y":645,"width":714,"height":12}},{"id":"db7a601f-23c4-4948-a67c-f0c2230a2edc","block_type":"box","text":"beneficial for new directors to be brought onto the board periodically to refresh the group’s thinking,","page_number":484,"box":{"x":117,"y":661,"width":735,"height":12}},{"id":"5c67d696-e889-4a91-9e9f-85755731f146","block_type":"box","text":"while supporting both continuity and appropriate succession planning. We consider the average overall","page_number":484,"box":{"x":116,"y":676,"width":763,"height":12}},{"id":"c788c8ca-c5c6-4038-b110-d8b189f1ecb3","block_type":"box","text":"tenure of the board and seek a balance between the knowledge and experience of longer-serving","page_number":484,"box":{"x":116,"y":692,"width":723,"height":12}},{"id":"bdfadd6c-02d1-415a-a6e1-83fdd4946f3e","block_type":"box","text":"directors and the fresh perspectives of directors who joined more recently.","page_number":484,"box":{"x":116,"y":707,"width":549,"height":12}},{"id":"6f765f47-86ea-436b-a2b6-543d9039cb01","block_type":"box","text":"We appreciate when companies regularly review and assess how directors nominated for election","page_number":484,"box":{"x":116,"y":738,"width":725,"height":12}},{"id":"4824e248-980b-406e-8f6b-fa4e265da600","block_type":"box","text":"contribute to the effectiveness of the board. In our view, the company’s assessment should consider a","page_number":484,"box":{"x":116,"y":754,"width":757,"height":12}},{"id":"b860ebc9-9e96-4e4f-94ec-16f9427ee357","block_type":"box","text":"number of factors, including each director’s independence and time commitments, as well as the","page_number":484,"box":{"x":117,"y":769,"width":715,"height":12}},{"id":"be95590a-44a8-43df-a016-c56350263ed1","block_type":"box","text":"breadth and relevance of director experiences and skillsets, and how these collectively contribute to","page_number":484,"box":{"x":117,"y":785,"width":739,"height":12}},{"id":"7079e37a-0f7d-4df6-a9ec-978a35cb665d","block_type":"box","text":"the board’s effectiveness in advising and overseeing management in delivering long-term financial","page_number":484,"box":{"x":116,"y":800,"width":728,"height":12}},{"id":"9b06876d-5fea-4c04-85d9-cc00444a7532","block_type":"box","text":"returns.","page_number":484,"box":{"x":117,"y":816,"width":54,"height":9}},{"id":"918e73ef-099d-43bf-a6bd-bfdb01169cf1","block_type":"box","text":"5","page_number":484,"box":{"x":143,"y":867,"width":4,"height":5}},{"id":"6414a177-012a-4b9a-b48f-85fa29c6c94a","block_type":"box","text":"In most markets, directors stand for re-election on an annual or triennial basis, as determined by corporate law, market","page_number":484,"box":{"x":171,"y":867,"width":703,"height":9}},{"id":"ef7404a4-b090-4c59-9921-31ffec2fa5ae","block_type":"box","text":"regulation or voluntary best practice.","page_number":484,"box":{"x":170,"y":880,"width":215,"height":9}},{"id":"0a98558b-b4da-45e6-a339-a38bdd55db99","block_type":"box","text":"BlackRock Investment Stewardship","page_number":484,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"cf5000be-15e2-4d63-9699-566db794fff7","block_type":"box","text":"Global Principles |","page_number":484,"box":{"x":735,"y":909,"width":133,"height":12}},{"id":"7606fda0-ee5c-4fce-8c12-dd2d0f8ea21b","block_type":"box","text":"6","page_number":484,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"7943463f-aac2-44ea-bfa1-2658345df88b","block_type":"box","text":"NM1026U-6004382-484/605","page_number":484,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"496916c5-57dc-4688-9485-ad9991720f8d","block_type":"box","text":"Director independence","page_number":485,"box":{"x":116,"y":87,"width":187,"height":12}},{"id":"e6b3f117-6b06-431d-8fe0-db97f50a39bf","block_type":"box","text":"Director independence – from management, significant shareholders, or other related parties – is a","page_number":485,"box":{"x":117,"y":117,"width":738,"height":12}},{"id":"0b819f47-5c8d-4da9-8cf9-a687e4f3b179","block_type":"box","text":"central tenet of sound corporate governance across markets.","page_number":485,"box":{"x":116,"y":132,"width":452,"height":12}},{"id":"396d418d-86c5-4103-9da1-93b9f48bc8bf","block_type":"box","text":"6","page_number":485,"box":{"x":570,"y":132,"width":5,"height":6}},{"id":"1b7e9dac-8bd2-45bb-bc2f-08a9f9013070","block_type":"box","text":"We look to boards to have a sufficient","page_number":485,"box":{"x":576,"y":132,"width":290,"height":10}},{"id":"94fbabb3-c6bd-49ed-a423-fdbe90ad7591","block_type":"box","text":"number of independent directors, free from conflicts of interest or undue influence, to ensure objectivity","page_number":485,"box":{"x":117,"y":148,"width":768,"height":12}},{"id":"14536465-17ca-4611-85d6-319678cd1045","block_type":"box","text":"in the decision-making of the board and its ability to oversee management. We generally consider it","page_number":485,"box":{"x":117,"y":163,"width":742,"height":12}},{"id":"83970a82-4bba-4eb2-b5dd-eab8c9d6ac51","block_type":"box","text":"good practice for independent directors to make a majority of the board, or in the case of controlled","page_number":485,"box":{"x":116,"y":179,"width":740,"height":12}},{"id":"0f997b70-85cd-4446-b28c-a026cdd13d04","block_type":"box","text":"companies, at least one-third.","page_number":485,"box":{"x":116,"y":194,"width":225,"height":12}},{"id":"1752b24e-1b24-4202-bbc2-b6284c010a67","block_type":"box","text":"Common impediments to independence may include but are not limited to:","page_number":485,"box":{"x":117,"y":224,"width":557,"height":12}},{"id":"6eca948b-2900-4c4a-a4b0-ff54ce435ec2","block_type":"box","text":"• Current or recent employment at the company or a subsidiary","page_number":485,"box":{"x":117,"y":254,"width":495,"height":12}},{"id":"2c71f126-df87-4c62-8472-3fc6019b2022","block_type":"box","text":"• Being, or representing, a shareholder with a substantial shareholding in the company","page_number":485,"box":{"x":117,"y":276,"width":668,"height":12}},{"id":"816ca7e5-bd29-4972-b684-c65164d0d2e4","block_type":"box","text":"• Interlocking directorates","page_number":485,"box":{"x":117,"y":299,"width":216,"height":12}},{"id":"bc5809d0-0763-4d5e-b1b3-1b7254f627de","block_type":"box","text":"• Having any other interest, business, or other relationship which could, or could reasonably be","page_number":485,"box":{"x":117,"y":322,"width":730,"height":12}},{"id":"291fceb5-7266-409f-880e-a5fc5e6946fc","block_type":"box","text":"perceived to, materially interfere with a director’s ability to act in the best interests of the company","page_number":485,"box":{"x":150,"y":337,"width":729,"height":12}},{"id":"abe384b7-f30a-4b17-8d28-2b44b0b86bbf","block_type":"box","text":"and shareholders","page_number":485,"box":{"x":150,"y":353,"width":134,"height":9}},{"id":"76e5c64d-fc59-4b18-99f8-fa02042a3959","block_type":"box","text":"In our experience, boards are most effective at overseeing and advising management when there is a","page_number":485,"box":{"x":117,"y":382,"width":759,"height":12}},{"id":"b7f86451-9950-4fbc-bea9-3ddb74fde2d3","block_type":"box","text":"senior, independent board leader. This director may chair the board, or, where the chair is also the","page_number":485,"box":{"x":116,"y":398,"width":736,"height":12}},{"id":"f2be68c7-90f4-480d-ba81-40a5e7c98c71","block_type":"box","text":"CEO (or is otherwise not independent), be designated as a lead independent director. The role of this","page_number":485,"box":{"x":117,"y":413,"width":757,"height":12}},{"id":"095eb219-7c47-4fd4-93f4-74564fcb1ac8","block_type":"box","text":"director is to support independent board members in fulfilling their oversight responsibilities effectively","page_number":485,"box":{"x":116,"y":429,"width":760,"height":12}},{"id":"220e9d8e-918f-433c-b787-da9d71adbf11","block_type":"box","text":"by shaping the agenda, ensuring adequate information is provided to the board, and encouraging","page_number":485,"box":{"x":117,"y":444,"width":726,"height":12}},{"id":"beef7e44-5c8f-4303-9573-9cdb337bead1","block_type":"box","text":"independent director participation in board deliberations. We appreciate when the lead independent","page_number":485,"box":{"x":117,"y":460,"width":742,"height":12}},{"id":"9812c614-5ab5-475d-b49d-2bae74bf53c5","block_type":"box","text":"director or another appropriate director is available to meet with shareholders to explain and","page_number":485,"box":{"x":116,"y":475,"width":687,"height":12}},{"id":"fb465edd-ea6e-40d7-93c4-0a407796249a","block_type":"box","text":"contextualize a company’s approach as a situation warrants.","page_number":485,"box":{"x":116,"y":491,"width":454,"height":12}},{"id":"3fea6e02-29b0-49e1-86be-1726162624f2","block_type":"box","text":"Boards may face matters that could involve conflicts of interest for executives or affiliated directors, or","page_number":485,"box":{"x":117,"y":520,"width":759,"height":13}},{"id":"ff801f11-151d-4d60-afdc-4bbe080d1f86","block_type":"box","text":"that require additional focus. It is our view that objective oversight of such matters is best achieved","page_number":485,"box":{"x":116,"y":536,"width":736,"height":12}},{"id":"13a54850-dfb6-4408-ab0e-c6a30ffbf703","block_type":"box","text":"when the board forms committees with a majority of independent directors, depending on market","page_number":485,"box":{"x":116,"y":551,"width":723,"height":13}},{"id":"b070c590-a199-4753-9485-263c98e732eb","block_type":"box","text":"norms and a company’s ownership structure. In many markets, these committees of the board","page_number":485,"box":{"x":117,"y":567,"width":704,"height":12}},{"id":"815055f5-c31c-48a6-b0cf-b928091ed66a","block_type":"box","text":"specialize in audit, director nominations, and compensation matters, among others. An ad hoc","page_number":485,"box":{"x":116,"y":583,"width":703,"height":12}},{"id":"f38be38e-7150-4cba-bb95-4b399fbc152a","block_type":"box","text":"committee might also be formed to decide on a special transaction, particularly one involving a related","page_number":485,"box":{"x":116,"y":598,"width":762,"height":12}},{"id":"cc4c2426-9889-40e6-9ff2-3ff17f1ac43f","block_type":"box","text":"party, or to investigate a significant adverse event.","page_number":485,"box":{"x":117,"y":613,"width":378,"height":13}},{"id":"62389462-33a2-41df-a8d3-f732d7f75308","block_type":"box","text":"Sufficient capacity","page_number":485,"box":{"x":117,"y":643,"width":152,"height":12}},{"id":"42c9c764-93ef-4151-8d23-349f8a66c477","block_type":"box","text":"As the role and expectations of a director are increasingly demanding, directors must be able to","page_number":485,"box":{"x":116,"y":673,"width":709,"height":12}},{"id":"e0c7407c-c207-4c70-a289-1d2f8bd072f8","block_type":"box","text":"commit an appropriate amount of time to board and committee matters. It is important that directors","page_number":485,"box":{"x":116,"y":688,"width":738,"height":12}},{"id":"261faee7-261b-47a5-8643-b6cc95db2eb3","block_type":"box","text":"have the capacity to meet all of their responsibilities – including when there are unforeseen events –","page_number":485,"box":{"x":117,"y":704,"width":743,"height":12}},{"id":"ead9eb41-7dcc-47b5-bacb-fe21b295bd33","block_type":"box","text":"and therefore, we consider it best practice when they don’t take on an excessive number of roles that","page_number":485,"box":{"x":116,"y":719,"width":751,"height":13}},{"id":"b1b380fe-b1c4-48bd-a2b5-889cccfcd8a5","block_type":"box","text":"would impair their ability to fulfill their duties.","page_number":485,"box":{"x":116,"y":735,"width":326,"height":12}},{"id":"70da3328-f841-44db-8249-d74138e4d263","block_type":"box","text":"Board composition","page_number":485,"box":{"x":116,"y":765,"width":153,"height":12}},{"id":"7fcca925-2461-4aef-95bd-e9788b08492d","block_type":"box","text":"In assessing board composition, we take into account a company’s board size, business model,","page_number":485,"box":{"x":117,"y":795,"width":708,"height":11}},{"id":"d98164f1-7e49-4e3a-963c-3135c7159b8d","block_type":"box","text":"strategy, market capitalization, and ownership structure, as well as the market in which the company","page_number":485,"box":{"x":116,"y":810,"width":745,"height":12}},{"id":"b3dee9fb-2d12-41f8-9cfa-53e5f9762ee0","block_type":"box","text":"operates. We find it helpful when companies explain how their approach to board composition supports","page_number":485,"box":{"x":116,"y":825,"width":771,"height":12}},{"id":"809a827f-45c4-4510-8db3-5eab2ea764d2","block_type":"box","text":"the company’s governance practices.","page_number":485,"box":{"x":116,"y":841,"width":282,"height":12}},{"id":"b0bf5143-22a6-4721-ac0a-45925be444a1","block_type":"box","text":"6","page_number":485,"box":{"x":143,"y":866,"width":4,"height":5}},{"id":"53878e04-c73b-443d-995e-c00feca1932b","block_type":"box","text":"For example, please see: Tokyo Stock Exchange, “Japan’s Corporate Governance Code,” June 11, 2021; Financial","page_number":485,"box":{"x":171,"y":866,"width":683,"height":10}},{"id":"86cb58f4-b58b-42f8-9b99-85883df13e1f","block_type":"box","text":"Reporting Council, “UK Corporate Governance Code,” January 2024, accessed in December 2025.","page_number":485,"box":{"x":171,"y":879,"width":587,"height":10}},{"id":"4d46e408-7a67-4101-bd43-ba21f0d89e89","block_type":"box","text":"BlackRock Investment Stewardship","page_number":485,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"0af2eeb6-a10a-43c5-b6f3-d7a57c2d3c87","block_type":"box","text":"Global Principles |","page_number":485,"box":{"x":735,"y":909,"width":133,"height":12}},{"id":"67397e9c-80de-4e0f-8b5c-db1e7454224b","block_type":"box","text":"7","page_number":485,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"87d5af62-7251-4fdd-b053-9d744fa4ba51","block_type":"box","text":"NM1026U-6004382-485/605","page_number":485,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5a7cd818-8f39-4555-a08e-2a3b59e42ceb","block_type":"box","text":"When nominating directors to the board, we look to companies to provide sufficient information on the","page_number":486,"box":{"x":116,"y":87,"width":760,"height":12}},{"id":"d0dba545-9f8d-4679-8ccd-aee6f49f22ca","block_type":"box","text":"individual candidates so that shareholders can assess the capabilities and suitability of each individual","page_number":486,"box":{"x":117,"y":102,"width":763,"height":13}},{"id":"808d23e4-2001-482b-a5e1-e7984a72bf8f","block_type":"box","text":"nominee and their fit within overall board composition. These disclosures should explain how the","page_number":486,"box":{"x":117,"y":118,"width":721,"height":12}},{"id":"d850d05e-a242-4e3a-b707-a83e9dd6c73c","block_type":"box","text":"collective experience and expertise of the board, as well as the particular skillsets of individual","page_number":486,"box":{"x":116,"y":134,"width":703,"height":11}},{"id":"5da2bfab-37b3-443f-8990-cebe96317445","block_type":"box","text":"directors, aligns with the company’s long-term strategy. Highly qualified, engaged directors with","page_number":486,"box":{"x":116,"y":149,"width":713,"height":12}},{"id":"62065df1-6d95-4c95-a884-641a9605db79","block_type":"box","text":"professional characteristics relevant to a company’s business and strategy enhance the ability of the","page_number":486,"box":{"x":117,"y":165,"width":749,"height":12}},{"id":"3d29dfdc-57e5-4c31-9aed-46e8cbd3714e","block_type":"box","text":"board to add value and be the voice of shareholders in board discussions.","page_number":486,"box":{"x":117,"y":180,"width":554,"height":10}},{"id":"6a0e896d-4532-491b-a865-f14441fa76bb","block_type":"box","text":"It is in this context that we are interested in a variety of experiences, perspectives, and skillsets in the","page_number":486,"box":{"x":117,"y":212,"width":755,"height":12}},{"id":"313dc304-282b-496b-a769-06e6492e5968","block_type":"box","text":"board room. We see it as a means of avoiding “group think” in the board’s exercise of its","page_number":486,"box":{"x":117,"y":228,"width":659,"height":12}},{"id":"e190ebd7-f82d-4588-808c-e3c6d291af95","block_type":"box","text":"responsibilities to advise and oversee management. We note that in many markets, policymakers have","page_number":486,"box":{"x":117,"y":244,"width":768,"height":11}},{"id":"3a8d1e64-4072-416f-8a84-5d61cf2b72f6","block_type":"box","text":"set board gender diversity goals which we may discuss with companies, particularly if there is a risk","page_number":486,"box":{"x":116,"y":259,"width":743,"height":12}},{"id":"ad1ba043-2ba3-46b8-9143-abaec972da7d","block_type":"box","text":"their board composition may be misaligned.","page_number":486,"box":{"x":116,"y":275,"width":329,"height":12}},{"id":"8adc8b49-1344-40ac-a6ba-dcdce4d72ef3","block_type":"box","text":"Auditors and audit-related issues","page_number":486,"box":{"x":366,"y":315,"width":272,"height":10}},{"id":"a3165493-ef47-48df-8460-0f256c2ecb80","block_type":"box","text":"BIS recognizes the critical importance of financial statements to provide a complete and accurate","page_number":486,"box":{"x":117,"y":348,"width":725,"height":12}},{"id":"3a4c814d-4d2e-4716-b79d-bce275e5b976","block_type":"box","text":"portrayal of a company’s financial condition. Accordingly, we look for the assumptions made by","page_number":486,"box":{"x":117,"y":363,"width":709,"height":12}},{"id":"8390bade-07e3-4c03-ae67-958fd208090e","block_type":"box","text":"management, and reviewed by the auditor in preparing the financial statements, to be reasonable and","page_number":486,"box":{"x":117,"y":379,"width":760,"height":12}},{"id":"16686733-fbb3-4617-bd42-c04c58daef74","block_type":"box","text":"justified.","page_number":486,"box":{"x":115,"y":394,"width":67,"height":12}},{"id":"dbdc6b20-41be-4c18-9a91-dfa13c67eada","block_type":"box","text":"We view the audit committee, or its equivalent, as responsible for overseeing the management of the","page_number":486,"box":{"x":116,"y":426,"width":754,"height":13}},{"id":"0abfaf51-0bdc-46b8-a690-a49bf7c72380","block_type":"box","text":"independent auditor and the internal audit function at a company. The committee plays an important","page_number":486,"box":{"x":117,"y":442,"width":746,"height":12}},{"id":"9a5e079f-79e9-4abe-b85a-6e0db36ca432","block_type":"box","text":"role in a company’s financial reporting system by providing independent oversight of the accounts,","page_number":486,"box":{"x":117,"y":457,"width":733,"height":13}},{"id":"5457c1c0-56ee-4ba2-a12b-033d1c4c5344","block_type":"box","text":"material financial, and, where appropriate to the jurisdiction, non-financial information and internal","page_number":486,"box":{"x":117,"y":473,"width":728,"height":12}},{"id":"f86007b3-747f-4288-ac8f-ec93baf3f880","block_type":"box","text":"control frameworks. Moreover, in the absence of a dedicated risk committee, these committees can","page_number":486,"box":{"x":116,"y":488,"width":743,"height":12}},{"id":"0d88858d-9602-4c9d-9392-cac86eb1c0f7","block_type":"box","text":"provide oversight of Enterprise Risk Management systems.","page_number":486,"box":{"x":117,"y":504,"width":437,"height":12}},{"id":"75fbfe1d-001e-4cf5-8a9d-962d5d3ee9ad","block_type":"box","text":"7","page_number":486,"box":{"x":556,"y":504,"width":5,"height":6}},{"id":"c691e77e-b1b7-4d27-b066-c3b979593694","block_type":"box","text":"In our view, effective audit committee","page_number":486,"box":{"x":562,"y":504,"width":286,"height":11}},{"id":"1de387e7-e01a-4507-94c6-6af423fe44c9","block_type":"box","text":"oversight strengthens the quality and reliability of a company’s financial statements and provides an","page_number":486,"box":{"x":116,"y":519,"width":745,"height":13}},{"id":"f135d822-aac6-4527-86f6-7ac1b93a962d","block_type":"box","text":"important level of reassurance to shareholders.","page_number":486,"box":{"x":117,"y":535,"width":354,"height":12}},{"id":"422fc99e-ee5e-44a3-8118-099f7dc65208","block_type":"box","text":"We look to audit committees, or their equivalent, to have clearly articulated charters that set out their","page_number":486,"box":{"x":116,"y":567,"width":750,"height":12}},{"id":"86282dff-5a11-4b16-ad68-566138c27163","block_type":"box","text":"responsibilities. Additionally, having a rotation plan can periodically refresh the committee membership","page_number":486,"box":{"x":117,"y":583,"width":765,"height":12}},{"id":"71a672bf-5ac4-44b0-baa5-3844a1abcbdd","block_type":"box","text":"and introduce new perspectives. We recognize that audit committees will rely on management, internal","page_number":486,"box":{"x":116,"y":598,"width":769,"height":12}},{"id":"3c7f52a0-9fe2-48cb-bcfa-0f1c510f77f6","block_type":"box","text":"audit, and the independent auditor to fulfill their responsibilities. However, we look to committee","page_number":486,"box":{"x":116,"y":614,"width":712,"height":12}},{"id":"310b9540-209d-4495-80ad-95fab91984e3","block_type":"box","text":"members to demonstrate they have relevant expertise to monitor and oversee the audit process and","page_number":486,"box":{"x":117,"y":629,"width":749,"height":12}},{"id":"567ac5ed-d1a1-4f38-b177-d9c59c078f22","block_type":"box","text":"related activities.","page_number":486,"box":{"x":117,"y":645,"width":129,"height":9}},{"id":"65e2fc0e-376e-4988-8dbb-942a4c8b4056","block_type":"box","text":"We take particular note of unexplained changes in reporting methodology, cases involving significant","page_number":486,"box":{"x":116,"y":677,"width":748,"height":12}},{"id":"a35356ae-2870-4bc5-afb5-30884718b6ef","block_type":"box","text":"financial restatements, or ad hoc notifications of material financial weakness. In this respect, we look to","page_number":486,"box":{"x":116,"y":693,"width":765,"height":12}},{"id":"4c5770db-0775-49de-b269-6a48cf825d17","block_type":"box","text":"audit committees to provide timely disclosure on the remediation of key and critical audit matters","page_number":486,"box":{"x":116,"y":708,"width":715,"height":12}},{"id":"d0787ddb-6d8a-4f3d-a09e-331ba928f1fc","block_type":"box","text":"identified either by the external auditor or internal audit function.","page_number":486,"box":{"x":117,"y":724,"width":472,"height":12}},{"id":"e5b7d63e-59e1-4840-b8a2-4af4324fb832","block_type":"box","text":"The integrity of financial statements depends on the auditor being free of any impediments that could","page_number":486,"box":{"x":116,"y":756,"width":748,"height":12}},{"id":"13b7af8f-0411-43c8-a97b-ace671f10e08","block_type":"box","text":"compromise its ability to serve as an effective check on management. To that end, it is important that","page_number":486,"box":{"x":116,"y":772,"width":750,"height":12}},{"id":"9d818ac1-553b-45ae-ae2e-54f28a0a249a","block_type":"box","text":"auditors are, and are seen to be, independent. Where an audit firm provides services to the company","page_number":486,"box":{"x":116,"y":787,"width":751,"height":12}},{"id":"341678a3-01ba-4d3e-8ef1-aa130c93e976","block_type":"box","text":"in addition to the audit, we look for the fees","page_number":486,"box":{"x":117,"y":803,"width":318,"height":11}},{"id":"f3d7ebd2-22a6-46bd-8048-ca93c1acaf31","block_type":"box","text":"earned to be disclosed and explained. We look for audit","page_number":486,"box":{"x":441,"y":803,"width":414,"height":12}},{"id":"477b6069-85c3-4642-ad48-b4dfb353ad15","block_type":"box","text":"7","page_number":486,"box":{"x":143,"y":828,"width":4,"height":5}},{"id":"67922b0e-7528-4df1-a3f9-8bfb3fab64ac","block_type":"box","text":"Enterprise Risk Management is a process, effected by the entity’s board of directors, management, and other","page_number":486,"box":{"x":171,"y":828,"width":648,"height":9}},{"id":"d219b252-24fa-4d61-9787-fe7496c22188","block_type":"box","text":"personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect the","page_number":486,"box":{"x":170,"y":841,"width":709,"height":9}},{"id":"00b59898-898e-4877-916e-562e12000447","block_type":"box","text":"entity, and manage risk to be within the risk appetite, to provide reasonable assurance regarding the achievement of","page_number":486,"box":{"x":170,"y":854,"width":690,"height":9}},{"id":"7ae80df4-05b3-4ed1-a587-bff66e024e7b","block_type":"box","text":"objectives. Please see: The Committee of Sponsoring Organizations of the Treadway Commission (COSO), “Enterprise","page_number":486,"box":{"x":170,"y":866,"width":710,"height":10}},{"id":"e634cde9-408d-4b7d-8919-f2b6f8e4f459","block_type":"box","text":"Risk Management,” 2023, accessed in December 2025.","page_number":486,"box":{"x":171,"y":879,"width":329,"height":10}},{"id":"033557fe-73dc-4390-941e-fbb53e30192d","block_type":"box","text":"BlackRock Investment Stewardship","page_number":486,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"b643aa91-3eaf-4849-ada8-a817593dab4e","block_type":"box","text":"Global Principles |","page_number":486,"box":{"x":735,"y":909,"width":133,"height":12}},{"id":"20e8bb21-1413-4896-a4c5-70d1f1d267fe","block_type":"box","text":"8","page_number":486,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"f55d9057-81bd-4cea-85be-d68a27add619","block_type":"box","text":"NM1026U-6004382-486/605","page_number":486,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a985f53b-3179-47d1-a2cc-cf6d6cf34463","block_type":"box","text":"committees to have in place a procedure for assessing the independence of the auditor and the quality","page_number":487,"box":{"x":116,"y":87,"width":767,"height":12}},{"id":"20ae424d-f4a3-4e4e-888b-46e930c4d45f","block_type":"box","text":"of the external audit process on an annual basis.","page_number":487,"box":{"x":116,"y":102,"width":366,"height":12}},{"id":"aea798e2-9d0d-4d97-b9c3-34154c6b4458","block_type":"box","text":"Comprehensive disclosure provides investors with an understanding of the company’s long-term","page_number":487,"box":{"x":117,"y":134,"width":719,"height":12}},{"id":"76a96be3-73fb-4632-9e6a-b09d1131cf59","block_type":"box","text":"operational risk management practices and, more broadly, the quality of the board’s oversight. We look","page_number":487,"box":{"x":116,"y":149,"width":770,"height":12}},{"id":"d4367d85-a941-42c2-abc1-a24946b7240d","block_type":"box","text":"to the audit or risk committee to periodically review the company’s risk assessment and risk","page_number":487,"box":{"x":116,"y":165,"width":684,"height":12}},{"id":"34dfe74f-258b-472e-96b0-e0439394b447","block_type":"box","text":"management policies and the significant risks and exposures identified by management, the internal","page_number":487,"box":{"x":117,"y":180,"width":747,"height":12}},{"id":"1b4a7024-bffe-4f30-ad84-9e0b40c6e027","block_type":"box","text":"auditors or the independent auditors, and management’s steps to address them. In the absence of","page_number":487,"box":{"x":116,"y":196,"width":735,"height":12}},{"id":"433e9c94-9a49-45a1-a039-bd17f44cf9ac","block_type":"box","text":"detailed disclosures, we may conclude that companies are not adequately managing risk.","page_number":487,"box":{"x":116,"y":211,"width":668,"height":12}},{"id":"c96c8fa7-7399-4158-bb09-4392a8a46920","block_type":"box","text":"Capital structure, mergers, acquisitions, asset sales, and other special situations","page_number":487,"box":{"x":176,"y":250,"width":652,"height":12}},{"id":"2b634c38-f482-40e1-ad67-eb71ad909821","block_type":"box","text":"The capital structure of a company is critical to shareholders as it impacts the value of their investment","page_number":487,"box":{"x":116,"y":281,"width":766,"height":12}},{"id":"b2fe8507-84d6-4db6-9b55-7fa3895ba0b4","block_type":"box","text":"and the priority of their interest in the company relative to that of other equity or debt investors.","page_number":487,"box":{"x":116,"y":296,"width":707,"height":12}},{"id":"e3aa422c-ea38-4664-9fe1-0a63f0becb79","block_type":"box","text":"Pre-emptive rights are a key protection for shareholders against the dilution of their interests.","page_number":487,"box":{"x":117,"y":312,"width":693,"height":12}},{"id":"24d13fc2-e6b3-4b2d-b10f-e8219f846949","block_type":"box","text":"In principle, we have concerns with the creation of a share class with equivalent economic exposure","page_number":487,"box":{"x":117,"y":343,"width":746,"height":12}},{"id":"ee589f05-0c6a-4ec2-b200-d2e9b4d4ca9e","block_type":"box","text":"and differentiated voting rights. As a result, BIS generally supports bylaw amendments that introduce","page_number":487,"box":{"x":116,"y":358,"width":754,"height":12}},{"id":"3481961c-9d78-417c-9aaa-9e014a2319c0","block_type":"box","text":"the adoption of “one share, one vote” for registered shareholders.","page_number":487,"box":{"x":116,"y":374,"width":491,"height":12}},{"id":"5fd47307-9344-42a0-8f49-4eae386a4d3e","block_type":"box","text":"However, we recognize that in certain markets, at","page_number":487,"box":{"x":117,"y":405,"width":364,"height":12}},{"id":"b4ddb4f4-0144-4294-8117-ad4a9e4ad72b","block_type":"box","text":"least for a period of time, companies may have a valid","page_number":487,"box":{"x":482,"y":405,"width":397,"height":12}},{"id":"ed91c7c7-40be-4bfb-9ea9-06fad7890565","block_type":"box","text":"reason for listing dual classes of shares with different","page_number":487,"box":{"x":117,"y":420,"width":384,"height":12}},{"id":"7239ff29-40ef-464e-817e-aee7986f8b74","block_type":"box","text":"iated voting rights. In our view, such companies","page_number":487,"box":{"x":502,"y":420,"width":350,"height":12}},{"id":"d7400d39-3cda-40a4-80ff-aa5156db1f6c","block_type":"box","text":"should review these share class structures on a r","page_number":487,"box":{"x":116,"y":436,"width":357,"height":9}},{"id":"39cc5f78-763c-4830-bf07-c2e010971cdd","block_type":"box","text":"egular basis or as company circumstances change.","page_number":487,"box":{"x":473,"y":436,"width":379,"height":12}},{"id":"a143df39-3534-4cde-9c15-025d2c150fba","block_type":"box","text":"Additionally, they should seek shareholder approval of","page_number":487,"box":{"x":116,"y":451,"width":394,"height":12}},{"id":"2a14fa85-78ae-4dbe-90e6-c4bbf5da4265","block_type":"box","text":"f their capital structure on a periodic basis via a","page_number":487,"box":{"x":510,"y":451,"width":342,"height":12}},{"id":"71b709fe-e697-4d42-b9b7-94b029a72ed9","block_type":"box","text":"management proposal at the company’s shareholder","page_number":487,"box":{"x":117,"y":467,"width":388,"height":12}},{"id":"c2cee6f8-9d3d-4b10-a6cf-39face301c36","block_type":"box","text":"meeting. The proposal should give unaffiliated","page_number":487,"box":{"x":506,"y":467,"width":339,"height":12}},{"id":"3130d236-e29b-43b8-91ca-7d532cbededd","block_type":"box","text":"shareholders the opportunity to affirm the current stru","page_number":487,"box":{"x":116,"y":482,"width":387,"height":12}},{"id":"f7c7eaa8-7960-487b-92a4-3f48570df499","block_type":"box","text":"cture or establish mechanisms to end or phase out","page_number":487,"box":{"x":504,"y":482,"width":373,"height":12}},{"id":"8f08e6e2-983b-4c43-8ad0-dd71a8b52615","block_type":"box","text":"controlling structures at the appropriate ti","page_number":487,"box":{"x":116,"y":498,"width":297,"height":12}},{"id":"ed42a4cd-7ff1-45fc-bf58-b13e8bb9546e","block_type":"box","text":"me, while minimizing costs to shareholders.","page_number":487,"box":{"x":414,"y":498,"width":322,"height":12}},{"id":"c806be79-de90-4e62-a36e-9734b3aae765","block_type":"box","text":"In assessing mergers, asset sales, or other special situations, BIS’ primary consideration is the long","page_number":487,"box":{"x":117,"y":529,"width":745,"height":12}},{"id":"7707b260-cbf7-403c-af3e-cc88b3b044ec","block_type":"box","text":"term financial interests of our clients as shareholders, and so we will review any proposed transaction","page_number":487,"box":{"x":116,"y":544,"width":758,"height":12}},{"id":"9e844c2e-9b5c-4bc6-8c2d-476c03e0383a","block_type":"box","text":"with that objective in mind. Typically, we review factors such as whether the proposed transaction has","page_number":487,"box":{"x":116,"y":560,"width":760,"height":12}},{"id":"01ab62fe-9ed7-48a5-b798-131842995b6e","block_type":"box","text":"the unanimous support of the board and has been negotiated at arm’s length, and whether the board","page_number":487,"box":{"x":116,"y":575,"width":753,"height":12}},{"id":"2a2c454c-ef36-4107-a289-884156a4fa98","block_type":"box","text":"or management has clearly explained its economic and strategic rationale. We may also seek","page_number":487,"box":{"x":116,"y":591,"width":699,"height":12}},{"id":"44607070-b33f-49d4-a15a-b34605cea079","block_type":"box","text":"reassurance from the board that the financial interests of executives and/or board members in a given","page_number":487,"box":{"x":117,"y":606,"width":761,"height":12}},{"id":"0b9c6573-8c57-49ce-b4ce-4658cd95f66c","block_type":"box","text":"transaction have not adversely affected their ability to place shareholders’ interests before their own.","page_number":487,"box":{"x":116,"y":622,"width":750,"height":12}},{"id":"aa3a85b3-d97f-4492-ba43-ebeee0cf670a","block_type":"box","text":"Where the transaction involves related parties, the recommendation to support should come from the","page_number":487,"box":{"x":116,"y":637,"width":755,"height":12}},{"id":"bba731f2-ee88-4b11-b10d-5c683541bef2","block_type":"box","text":"independent directors, a best practice in most markets, and ideally, the terms should have been","page_number":487,"box":{"x":117,"y":653,"width":715,"height":12}},{"id":"0ccb0a14-4dd1-4274-bc70-81f5b88bcd04","block_type":"box","text":"assessed through an independent appraisal process. In addition, it is good practice that it be approved","page_number":487,"box":{"x":116,"y":669,"width":760,"height":11}},{"id":"ebf2cbb4-e581-453b-93f3-f8f92b8f64ba","block_type":"box","text":"by a separate vote of the non-conflicted parties.","page_number":487,"box":{"x":117,"y":684,"width":352,"height":12}},{"id":"33547b05-f1d4-48ed-bf55-ccd42e787eef","block_type":"box","text":"As a matter of sound governance practice, shareholders should have a right to dispose of company","page_number":487,"box":{"x":116,"y":715,"width":738,"height":12}},{"id":"40372d29-6b90-432c-a3b5-5549977ae910","block_type":"box","text":"shares in the open market without unnecessary restriction. In our view, corporate mechanisms","page_number":487,"box":{"x":116,"y":731,"width":700,"height":12}},{"id":"6e836dc2-c00d-4f8c-9388-dd01af6f1983","block_type":"box","text":"designed to limit shareholders’ ability to sell their shares are contrary to basic property rights. Such","page_number":487,"box":{"x":116,"y":746,"width":732,"height":12}},{"id":"396280ff-2524-4a8f-9604-7433724d2377","block_type":"box","text":"mechanisms can serve to protect and entrench interests other than those of the shareholders. In our","page_number":487,"box":{"x":117,"y":761,"width":745,"height":12}},{"id":"e988c6c4-3879-4252-acdf-5d84e7094b86","block_type":"box","text":"view, shareholders are broadly capable of making decisions in their own best interests. We encourage","page_number":487,"box":{"x":116,"y":777,"width":759,"height":12}},{"id":"e8285055-d8a7-404e-b9b9-e53288eed2c5","block_type":"box","text":"any shareholder rights plans proposed by a board to be subject to shareholder approval upon","page_number":487,"box":{"x":116,"y":793,"width":693,"height":12}},{"id":"21d1d54b-935b-462a-9010-f2ccb363d661","block_type":"box","text":"introduction and periodically thereafter.","page_number":487,"box":{"x":117,"y":808,"width":287,"height":12}},{"id":"b07d778f-e928-444b-b6ca-f7961b5f7568","block_type":"box","text":"BlackRock Investment Stewardship","page_number":487,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"c7d4b11d-e1ae-4009-bc04-e7aa20247516","block_type":"box","text":"Global Principles |","page_number":487,"box":{"x":735,"y":909,"width":133,"height":12}},{"id":"6dc763e3-401a-4d91-aa54-6523464179b6","block_type":"box","text":"9","page_number":487,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"60097eb2-b648-4643-9d7f-aeb334d387ac","block_type":"box","text":"NM1026U-6004382-487/605","page_number":487,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"492344e1-da4d-4f52-b36c-dc0f6f04ddd9","block_type":"box","text":"Executive compensation and benefits","page_number":488,"box":{"x":350,"y":87,"width":305,"height":12}},{"id":"22f1a7e0-b500-4bff-a8f6-4ec21190d61a","block_type":"box","text":"Executive compensation is an important tool used by companies to support long-term financial value","page_number":488,"box":{"x":117,"y":118,"width":749,"height":12}},{"id":"ed78d054-436f-4f4d-a6b1-9181cbd764f5","block_type":"box","text":"creation. A well-structured compensation policy rewards the successful delivery of strategic,","page_number":488,"box":{"x":116,"y":134,"width":686,"height":12}},{"id":"dfa2723a-06a5-4cc9-a405-29b2de4036b7","block_type":"box","text":"operational, and/or financial goals; encourages an appropriate risk appetite; and aligns the interests of","page_number":488,"box":{"x":116,"y":149,"width":763,"height":12}},{"id":"271f1fa1-42d7-483c-ac1e-8b83a16ac20c","block_type":"box","text":"shareholders and executives through equity ownership.","page_number":488,"box":{"x":116,"y":165,"width":410,"height":12}},{"id":"7b455778-335b-4bd2-a55b-796312e49842","block_type":"box","text":"8","page_number":488,"box":{"x":528,"y":165,"width":5,"height":6}},{"id":"b10a57d6-c0ba-474e-8f93-40d0b1844031","block_type":"box","text":"We look for a clear link between variable pay and operational and financial performance that support","page_number":488,"box":{"x":116,"y":196,"width":751,"height":12}},{"id":"b09655c5-1fe7-4264-9e1c-e31543bf1a11","block_type":"box","text":"sustained financial value creation for our clients as shareholders. We appreciate when performance","page_number":488,"box":{"x":116,"y":211,"width":744,"height":12}},{"id":"5c3803ba-eb07-4d81-8cd2-fde59262bef0","block_type":"box","text":"targets incorporate ambitious objectives, and the corresponding metrics are aligned with the","page_number":488,"box":{"x":116,"y":227,"width":687,"height":12}},{"id":"5dcd8e4d-4952-49a3-952a-3f3e82dda1bc","block_type":"box","text":"company’s strategy and business model. BIS does not have a position on whether companies choose","page_number":488,"box":{"x":116,"y":242,"width":760,"height":12}},{"id":"dfee15f7-acbe-4d0b-a5c8-a3f36b68fc36","block_type":"box","text":"to use sustainability-related criteria in compensation structures, but, where they are included, we look","page_number":488,"box":{"x":116,"y":258,"width":757,"height":12}},{"id":"3e816aa5-2a5b-436b-afe0-8804349baedf","block_type":"box","text":"to companies to be as rigorous as they would be in setting other financial or operational targets. We","page_number":488,"box":{"x":116,"y":273,"width":745,"height":12}},{"id":"064ec682-485b-4aa6-9ef2-f2f5837f882a","block_type":"box","text":"appreciate when long-term incentive plans encompass timeframes that: 1) are distinct from annual","page_number":488,"box":{"x":116,"y":289,"width":735,"height":12}},{"id":"ffb12f77-7b1d-494a-b365-48d6f09213c5","block_type":"box","text":"executive compensation structures and metrics, and 2) encourage the delivery of strong financial","page_number":488,"box":{"x":116,"y":304,"width":724,"height":12}},{"id":"0c36172a-1986-4f11-a783-a27bedb2a50a","block_type":"box","text":"results over a period of years.","page_number":488,"box":{"x":117,"y":320,"width":225,"height":12}},{"id":"d7b0dd8f-e145-4352-860a-3ab72646fa39","block_type":"box","text":"We consider it best practice when board members responsible for designing and approving executive","page_number":488,"box":{"x":116,"y":351,"width":757,"height":12}},{"id":"ceb6816b-42e8-4c71-b9d4-7de4a7f66125","block_type":"box","text":"compensation carefully consider the company’s specific circumstances. Factors to consider may","page_number":488,"box":{"x":116,"y":366,"width":720,"height":12}},{"id":"bf731e02-a29b-4df4-bbf1-f6d53cc6818f","block_type":"box","text":"include the company’s risk profile, the environment it operates in, and the individuals the board is trying","page_number":488,"box":{"x":117,"y":382,"width":770,"height":12}},{"id":"4695670b-a6ca-40e2-bb84-ace2ca98161d","block_type":"box","text":"to attract and retain. We look to the compensation committees to guard against contractual","page_number":488,"box":{"x":116,"y":397,"width":679,"height":12}},{"id":"c62b2641-d2cc-4634-9751-5411ccd02216","block_type":"box","text":"arrangements that would entitle executives to material compensation for early termination of their","page_number":488,"box":{"x":116,"y":413,"width":726,"height":12}},{"id":"0ca5203a-2371-4aae-9426-a0b47e0de4e6","block_type":"box","text":"employment. Finally, we look for pension contributions and other deferred compensation arrangements","page_number":488,"box":{"x":116,"y":428,"width":770,"height":12}},{"id":"524747ef-c8d8-4c9a-8c89-9231ad65ff61","block_type":"box","text":"to be reasonable in light of market practices or the company’s business and executive compensation","page_number":488,"box":{"x":116,"y":444,"width":752,"height":12}},{"id":"e14a79dc-9a60-43f7-a0a3-f3d5eafd2bb5","block_type":"box","text":"strategies.","page_number":488,"box":{"x":116,"y":459,"width":82,"height":12}},{"id":"e0bf3054-cf3e-4918-afd6-e2b1633b1128","block_type":"box","text":"We are not supportive of one-off or special bonuses unrelated to company or individual performance.","page_number":488,"box":{"x":116,"y":490,"width":755,"height":12}},{"id":"9089ae74-77c6-4381-85a5-36f940d30677","block_type":"box","text":"Where discretion has been used by the compensation committee, or its equivalent, we appreciate","page_number":488,"box":{"x":116,"y":506,"width":730,"height":12}},{"id":"de9d2e53-a301-4d58-a5ca-a015ece74bfa","block_type":"box","text":"disclosure relating to how and why the discretion was used, and how the adjusted outcome is aligned","page_number":488,"box":{"x":116,"y":521,"width":757,"height":12}},{"id":"499f6541-6a13-412d-84af-61f9dec9b020","block_type":"box","text":"with the interests of shareholders. In addition, we acknowledge that the use of peer group evaluation","page_number":488,"box":{"x":116,"y":537,"width":751,"height":12}},{"id":"0f40e7ed-0c25-4b79-9c6e-3802274b7f4e","block_type":"box","text":"by compensation committees can help ensure competitive pay. However, we encourage companies to","page_number":488,"box":{"x":117,"y":552,"width":763,"height":12}},{"id":"334b29ce-a7a6-489e-9b3f-b13f0e1c49c5","block_type":"box","text":"clearly explain how compensation outcomes have rewarded performance rather than solely base","page_number":488,"box":{"x":116,"y":568,"width":724,"height":12}},{"id":"5b2aac84-5162-4245-b4a4-3b3921cebad2","block_type":"box","text":"increases in total compensation on peer benchmarking.","page_number":488,"box":{"x":117,"y":583,"width":416,"height":12}},{"id":"04e19658-0525-4def-803f-46e9b994aea2","block_type":"box","text":"We consider the inclusion of building clawback provisions into incentive plans as good practice. Such","page_number":488,"box":{"x":116,"y":614,"width":755,"height":12}},{"id":"4d9d0622-6a87-48b0-9bcc-1d7d31c98e52","block_type":"box","text":"provisions could require executives to forgo awards when compensation was based on faulty financial","page_number":488,"box":{"x":117,"y":630,"width":760,"height":12}},{"id":"c5bd4441-ada4-4eb9-b463-8534f1320f92","block_type":"box","text":"statements or deceptive business practices, or when their behavior caused material financial harm to","page_number":488,"box":{"x":116,"y":645,"width":754,"height":12}},{"id":"032dd0a5-f07f-46e2-9971-c26ac3a991a0","block_type":"box","text":"shareholders, material reputational risk to the company, or resulted in a criminal investigation.","page_number":488,"box":{"x":116,"y":661,"width":694,"height":12}},{"id":"87015be6-024f-4161-9266-1e779d6130aa","block_type":"box","text":"In our view, non-executive directors should be compensated in a manner that is commensurate with","page_number":488,"box":{"x":117,"y":692,"width":740,"height":12}},{"id":"698e79e4-d95f-44ad-a5fc-aa68392369f9","block_type":"box","text":"the time and effort expended in fulfilling their professional responsibilities. Additionally, these","page_number":488,"box":{"x":116,"y":707,"width":686,"height":12}},{"id":"54c4eecc-32f0-4afd-bca6-5f8a5dcd1158","block_type":"box","text":"compensation arrangements should not risk compromising directors’ independence or aligning their","page_number":488,"box":{"x":116,"y":723,"width":739,"height":12}},{"id":"538916cb-5673-493a-a781-3e730c6ce532","block_type":"box","text":"interests too closely with those of the management, whom they are charged with overseeing.","page_number":488,"box":{"x":117,"y":738,"width":687,"height":12}},{"id":"2110f6d7-7054-4de6-b254-ac3cf237650c","block_type":"box","text":"When assessing compensation proposals, BIS reviews companies’ disclosures to determine whether","page_number":488,"box":{"x":116,"y":769,"width":750,"height":12}},{"id":"662689fe-1067-4646-8211-5fc213ef1dac","block_type":"box","text":"the board’s approach to executive compensation is rigorous in light of the company’s stated long-term","page_number":488,"box":{"x":116,"y":785,"width":755,"height":12}},{"id":"b3cef0b6-337f-49d5-a268-d5ea8a8f4344","block_type":"box","text":"corporate strategy and specific circumstances, as well as local market and policy developments.","page_number":488,"box":{"x":116,"y":800,"width":713,"height":12}},{"id":"febca71d-08b3-4406-b9fc-f45f646366fe","block_type":"box","text":"8","page_number":488,"box":{"x":143,"y":867,"width":4,"height":5}},{"id":"62eb82c9-a6a1-4183-bd2b-f495b52b96f5","block_type":"box","text":"The terms “compensation,” “remuneration,” and “pay” are used interchangeably to describe the same concept in","page_number":488,"box":{"x":170,"y":867,"width":664,"height":9}},{"id":"e38b8da1-2c44-40a4-be02-1ebafd687c34","block_type":"box","text":"different markets.","page_number":488,"box":{"x":170,"y":880,"width":102,"height":7}},{"id":"63bea920-eda8-42c7-9cff-24cb9c8463f6","block_type":"box","text":"BlackRock Investment Stewardship","page_number":488,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"78e9b8b6-1b45-4e27-839b-1accdd74edd1","block_type":"box","text":"Global Principles |","page_number":488,"box":{"x":726,"y":909,"width":132,"height":12}},{"id":"eafd88a9-378c-45fb-b2a8-37b0d3b5e950","block_type":"box","text":"10","page_number":488,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"48e23a10-fb95-477b-bd0b-e1a3f0d5a74a","block_type":"box","text":"NM1026U-6004382-488/605","page_number":488,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"14f31595-faad-4600-857f-60210758818a","block_type":"box","text":"When our analysis indicates that executive compensation is misaligned with company performance,","page_number":489,"box":{"x":116,"y":87,"width":745,"height":12}},{"id":"891e7259-cb84-4654-a100-df6e47b6b5fc","block_type":"box","text":"BIS may not support management’s proposals to approve compensation, where they are on the","page_number":489,"box":{"x":117,"y":102,"width":715,"height":13}},{"id":"5753d415-7deb-4780-81f2-019fbd72f922","block_type":"box","text":"agenda. We may also not support members of the compensation committee or equivalent board","page_number":489,"box":{"x":116,"y":118,"width":719,"height":12}},{"id":"02a26553-9b2b-4d18-b05b-c785d99afe01","block_type":"box","text":"members for poor compensation practices or structures.","page_number":489,"box":{"x":117,"y":134,"width":421,"height":11}},{"id":"8a34d3c3-57de-46ec-83a4-fc159d0dad72","block_type":"box","text":"Shareholder protections and other corporate governance matters","page_number":489,"box":{"x":239,"y":172,"width":527,"height":12}},{"id":"1f404b8a-d59d-42fa-bd65-0314a89a1ba2","block_type":"box","text":"Corporate form","page_number":489,"box":{"x":116,"y":203,"width":127,"height":12}},{"id":"9eb36525-0bc7-43f0-80eb-f3a9315b2809","block_type":"box","text":"In our view, it is the responsibility of the board to determine the corporate form that is most appropriate","page_number":489,"box":{"x":117,"y":234,"width":766,"height":12}},{"id":"156370dd-8910-44ff-975d-edf4dc0e99ba","block_type":"box","text":"given the company’s purpose and business model.","page_number":489,"box":{"x":116,"y":250,"width":376,"height":12}},{"id":"b2b5e9fb-e4ab-424f-9930-072aeffc7402","block_type":"box","text":"9","page_number":489,"box":{"x":494,"y":250,"width":5,"height":6}},{"id":"6037afb2-e9d1-4aac-8da6-1834917b0baa","block_type":"box","text":"We look to companies proposing to change their","page_number":489,"box":{"x":500,"y":250,"width":369,"height":12}},{"id":"c4dc7030-f276-42c6-8632-9ca24958acba","block_type":"box","text":"corporate form to a public benefit corporation, or similar entity, to put it to a shareholder vote if not","page_number":489,"box":{"x":116,"y":265,"width":731,"height":12}},{"id":"7bdb6b41-979b-4879-83ca-dbf2f73dca9e","block_type":"box","text":"already required to do so under applicable law. We appreciate when supporting documentation from","page_number":489,"box":{"x":116,"y":281,"width":748,"height":12}},{"id":"e019b30c-36e8-4b4a-b97f-e231433a358a","block_type":"box","text":"companies or shareholders proposing to alter the corporate form clearly explains how the interests of","page_number":489,"box":{"x":116,"y":296,"width":755,"height":12}},{"id":"0f84274f-6292-48a5-805d-88753e49a580","block_type":"box","text":"shareholders and different stakeholders would be impacted as well as the accountability and voting","page_number":489,"box":{"x":116,"y":312,"width":741,"height":12}},{"id":"1c96ad7d-9864-4114-a9dd-1f28478b21ba","block_type":"box","text":"mechanisms that would be available to shareholders. We generally support management proposals if","page_number":489,"box":{"x":117,"y":327,"width":756,"height":12}},{"id":"4ca8581f-cde3-4e68-9be9-df8c73efc136","block_type":"box","text":"our analysis indicates that shareholders’ financial interests are adequately protected. Corporate form","page_number":489,"box":{"x":116,"y":343,"width":752,"height":12}},{"id":"15c17a0e-ded2-4b11-9c95-e3d2916b3c92","block_type":"box","text":"shareholder proposals are evaluated on a case-by-case basis.","page_number":489,"box":{"x":116,"y":358,"width":468,"height":12}},{"id":"a2139a97-a1c6-45fa-bf43-495d396eebbe","block_type":"box","text":"Shareholder proposals","page_number":489,"box":{"x":409,"y":397,"width":187,"height":12}},{"id":"4138f772-7877-452a-8f90-e4b7c8b769c5","block_type":"box","text":"In most markets, shareholders can submit proposals to be voted on at a company’s shareholder","page_number":489,"box":{"x":117,"y":428,"width":717,"height":12}},{"id":"80435f6e-eb79-4837-ab54-816fc5411a33","block_type":"box","text":"meeting, as long as certain requirements are met. Shareholder proposals span a wide range of topics,","page_number":489,"box":{"x":117,"y":444,"width":762,"height":12}},{"id":"8043c02c-84fe-4bb5-b703-92037ca16d1b","block_type":"box","text":"including governance reforms, capital management, and changes in the management or disclosure of","page_number":489,"box":{"x":117,"y":459,"width":758,"height":12}},{"id":"a6a3f0bb-b14c-4146-bfa6-e9114e716da3","block_type":"box","text":"sustainability-related risks. These proposals have a varying degree of relevance for companies across","page_number":489,"box":{"x":116,"y":475,"width":763,"height":12}},{"id":"354255c6-f564-4e11-b963-d6736dfe0cab","block_type":"box","text":"sectors, locations, and business models.","page_number":489,"box":{"x":116,"y":490,"width":307,"height":11}},{"id":"9ad6101c-0ff8-4ddb-a285-ad0b567e5790","block_type":"box","text":"BIS takes a case-by-case approach to voting on shareholder proposals and maintains a singular focus","page_number":489,"box":{"x":117,"y":521,"width":764,"height":12}},{"id":"e789f812-6cab-49dc-bd5b-b456b6cd510e","block_type":"box","text":"on the proposal’s implications for long-term financial value creation for shareholders. Our analysis","page_number":489,"box":{"x":116,"y":537,"width":730,"height":12}},{"id":"eeed20e2-91d2-4fd5-b2b4-0f476f7ead99","block_type":"box","text":"considers whether a shareholder proposal addresses a material risk that may impact a company’s","page_number":489,"box":{"x":116,"y":552,"width":732,"height":12}},{"id":"b579916d-9499-43c0-909e-4b505c02dfc2","block_type":"box","text":"long-term financial performance. BIS may support shareholder proposals that request disclosures that","page_number":489,"box":{"x":117,"y":568,"width":760,"height":12}},{"id":"dedffdde-eb9a-40e9-a9ae-b0d58e72cb67","block_type":"box","text":"help us, as long-term investors on behalf of our clients, better understand the material risks and","page_number":489,"box":{"x":117,"y":583,"width":713,"height":12}},{"id":"70f17b56-64e5-465b-9f8d-af06c9e2d62c","block_type":"box","text":"opportunities companies face and how they are managing them, especially where this information is","page_number":489,"box":{"x":116,"y":599,"width":747,"height":12}},{"id":"43318bbc-7978-48cb-a980-6445b1685010","block_type":"box","text":"additive given the company’s existing disclosures. We look for consistency between the specific","page_number":489,"box":{"x":116,"y":614,"width":715,"height":12}},{"id":"e7071262-7c1c-4034-8e1e-a1ba16e41099","block_type":"box","text":"request formally made in the proposal, the supporting documentation, and the proponents’ other","page_number":489,"box":{"x":117,"y":630,"width":717,"height":12}},{"id":"14419f32-376c-4bc5-9bc5-49add31a5f79","block_type":"box","text":"communications on the issues. We also assess the company’s practices and disclosures and the costs","page_number":489,"box":{"x":116,"y":645,"width":769,"height":12}},{"id":"02befe33-292b-4ee3-93b8-741bccad7a77","block_type":"box","text":"and benefits to the company of meeting the request made in the proposal. We take into consideration a","page_number":489,"box":{"x":116,"y":661,"width":767,"height":12}},{"id":"ffb8ecf0-2ce1-4c96-bfcf-d9f453826ff6","block_type":"box","text":"company’s governance practices and disclosures against those of their peers.","page_number":489,"box":{"x":116,"y":676,"width":577,"height":12}},{"id":"7ea00118-e43d-479b-82d6-2b57e20d965a","block_type":"box","text":"BIS does not support shareholder proposals that we view as inconsistent with long-term financial value","page_number":489,"box":{"x":117,"y":707,"width":762,"height":12}},{"id":"99946e1c-919d-4549-8b6d-d318e73ebb98","block_type":"box","text":"or that seek to micromanage companies. We take into consideration the legal effect of the proposal, as","page_number":489,"box":{"x":116,"y":723,"width":764,"height":12}},{"id":"03b5c474-a0b2-4cb4-a360-e09e4bb8554a","block_type":"box","text":"shareholder proposals may be advisory or legally binding depending on the jurisdiction, while others","page_number":489,"box":{"x":116,"y":738,"width":741,"height":12}},{"id":"43fd381a-cd68-4341-86ae-4004aa647f40","block_type":"box","text":"may make requests that would be deemed illegal in a given jurisdiction.","page_number":489,"box":{"x":117,"y":754,"width":528,"height":12}},{"id":"434d67eb-fbc6-443d-b6d6-c3b805ce5b93","block_type":"box","text":"In our experience, it is helpful when companies disclose the names of the proponent or organization","page_number":489,"box":{"x":117,"y":785,"width":740,"height":12}},{"id":"aa0356f6-57fd-451c-a286-a47ce3323a21","block_type":"box","text":"that has submitted or advised on the proposal. We recognize that some shareholder proposals bundle","page_number":489,"box":{"x":116,"y":800,"width":757,"height":12}},{"id":"22c71b2c-701a-4491-91cc-593f705b7bf6","block_type":"box","text":"topics and/or specific requests. Further, the proponent’s supporting statement may refer to topics that","page_number":489,"box":{"x":116,"y":816,"width":753,"height":12}},{"id":"a456a994-a331-4e3d-80d7-779c8ba31207","block_type":"box","text":"are not directly related to the request made in the proposal. In voting on behalf of clients, we must vote","page_number":489,"box":{"x":116,"y":831,"width":767,"height":12}},{"id":"122ea42c-1080-49c5-b16c-4cb43edf263f","block_type":"box","text":"9","page_number":489,"box":{"x":143,"y":880,"width":4,"height":5}},{"id":"2bb27748-aa64-46f7-bf08-3fb3a553a58a","block_type":"box","text":"Corporate form refers to the legal structure by which a business is organized.","page_number":489,"box":{"x":170,"y":880,"width":457,"height":9}},{"id":"1572ceca-c60d-46c1-9aee-9c783c7cdb11","block_type":"box","text":"BlackRock Investment Stewardship","page_number":489,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"90bc0b43-986a-4ed2-9763-7aebb12cab1b","block_type":"box","text":"Global Principles |","page_number":489,"box":{"x":726,"y":909,"width":132,"height":12}},{"id":"af0c7365-2292-40e0-9dae-6192611d7b2f","block_type":"box","text":"11","page_number":489,"box":{"x":866,"y":909,"width":15,"height":9}},{"id":"0e0c78ec-8329-44d5-8e89-03cf9c6860fc","block_type":"box","text":"NM1026U-6004382-489/605","page_number":489,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f4b1c434-1de8-4919-8058-718c4b217f63","block_type":"box","text":"yes or no on the proposal as phrased by the proponent. Therefore, when we vote in support of a","page_number":490,"box":{"x":116,"y":87,"width":720,"height":12}},{"id":"8a356019-c549-45b8-8a12-4b9eda5795f6","block_type":"box","text":"proposal, we are not necessarily endorsing every element of the proposal or the reasoning, objectives,","page_number":490,"box":{"x":117,"y":102,"width":765,"height":13}},{"id":"6e4d34de-c61a-4c02-8005-09453efb2200","block_type":"box","text":"or supporting statement of the proponent. We may support a proposal for different reasons than those","page_number":490,"box":{"x":116,"y":118,"width":762,"height":12}},{"id":"efbb7a81-bc48-49f5-ba7e-754b6292d5ba","block_type":"box","text":"put forth by the proponent, when we believe that overall it may advance our clients’ long-term financial","page_number":490,"box":{"x":117,"y":134,"width":762,"height":12}},{"id":"01ca0f92-c167-4cd8-ab80-a0219d4692aa","block_type":"box","text":"interests.","page_number":490,"box":{"x":117,"y":149,"width":72,"height":10}},{"id":"49135f94-d4a2-442c-b441-1f56d7899fd2","block_type":"box","text":"BlackRock is subject to certain rules, regulations, agency guidance, and contractual agreements that","page_number":490,"box":{"x":117,"y":180,"width":752,"height":12}},{"id":"88e922ed-9124-4b85-9189-4ed33d75a07c","block_type":"box","text":"place restrictions and limitations on how BlackRock can interact with the companies in which we invest","page_number":490,"box":{"x":117,"y":196,"width":766,"height":11}},{"id":"ec5c7ad9-68e6-41d8-b571-407c43bbab57","block_type":"box","text":"on behalf of our clients. BlackRock does not nominate directors for board elections or submit","page_number":490,"box":{"x":116,"y":211,"width":692,"height":10}},{"id":"24167ddd-7dd5-4a41-ba21-5c0b86a46b71","block_type":"box","text":"shareholder proposals to companies. Non-compliance with these requirements could adversely affect","page_number":490,"box":{"x":116,"y":227,"width":757,"height":12}},{"id":"612d311f-db66-4805-aa16-3155ff0a4b3b","block_type":"box","text":"BlackRock’s ability to serve its clients’ interests.","page_number":490,"box":{"x":117,"y":242,"width":358,"height":12}},{"id":"7b2e7f06-2a66-4769-96eb-535214bfc920","block_type":"box","text":"Material sustainability-related risks and opportunities","page_number":490,"box":{"x":287,"y":281,"width":431,"height":12}},{"id":"2de5c479-c385-4a68-b74b-0690d0df166b","block_type":"box","text":"Appropriate oversight of material risks and opportunities, including material sustainability-related risks","page_number":490,"box":{"x":116,"y":312,"width":758,"height":12}},{"id":"816ee889-4f79-42d6-918f-9df05d76694d","block_type":"box","text":"and opportunities, is an important component of having an effective governance framework that","page_number":490,"box":{"x":116,"y":327,"width":714,"height":12}},{"id":"9b4338b8-2d58-4a72-8269-5a979e39a994","block_type":"box","text":"supports durable, long-term financial value creation.","page_number":490,"box":{"x":116,"y":343,"width":385,"height":12}},{"id":"d783a4ec-05d2-4ca2-b059-56cda7902b87","block_type":"box","text":"10","page_number":490,"box":{"x":503,"y":343,"width":11,"height":6}},{"id":"482a1515-05e9-4908-94c6-3306fe542d10","block_type":"box","text":"We look to companies to provide robust disclosure that allows investors to effectively evaluate","page_number":490,"box":{"x":116,"y":374,"width":703,"height":12}},{"id":"12e1db41-a6a2-49ac-beb7-b5f8eefbfe08","block_type":"box","text":"companies’ strategy and business practices related to material sustainability-related risks and","page_number":490,"box":{"x":116,"y":389,"width":699,"height":12}},{"id":"26ba1025-02e7-4c3e-887a-79e2faacbc60","block_type":"box","text":"opportunities. We find it helpful when companies’ disclosures demonstrate that they have a resilient","page_number":490,"box":{"x":116,"y":405,"width":743,"height":12}},{"id":"2c1246ef-60ac-429b-b71b-474f09f9726b","block_type":"box","text":"business model that integrates material sustainability-related risks and opportunities into their strategy,","page_number":490,"box":{"x":117,"y":420,"width":766,"height":12}},{"id":"bdd68f13-6496-4b16-9408-c0d2c9bd08c2","block_type":"box","text":"risk management, and metrics and targets, including industry-specific metrics.","page_number":490,"box":{"x":117,"y":436,"width":583,"height":12}},{"id":"2232f526-7a59-4e63-b1ec-94562b4ddaec","block_type":"box","text":"Standardized disclosure of sustainability-related data supports investors in making informed decisions.","page_number":490,"box":{"x":116,"y":467,"width":766,"height":12}},{"id":"300b3665-554c-42da-8388-03927ddbe77d","block_type":"box","text":"The International Sustainability Standards Board (ISSB) standards, IFRS S1 and S2, represent one","page_number":490,"box":{"x":116,"y":482,"width":743,"height":12}},{"id":"6897dc35-e635-43e3-b60d-ecd4d2dd429b","block_type":"box","text":"such approach to standardization that we find useful in our analysis.","page_number":490,"box":{"x":116,"y":498,"width":503,"height":12}},{"id":"716abfc5-8cf5-4f07-a706-67f45f37ab34","block_type":"box","text":"11","page_number":490,"box":{"x":622,"y":498,"width":9,"height":6}},{"id":"ab6a6edb-2ed1-4a4e-95fc-0c064c854b57","block_type":"box","text":"However, we do not mandate","page_number":490,"box":{"x":633,"y":498,"width":228,"height":11}},{"id":"5c2c5efc-a272-4e61-a516-d2bf29e1e95c","block_type":"box","text":"any specific disclosure framework companies should use, and recognize that companies may report","page_number":490,"box":{"x":116,"y":513,"width":747,"height":12}},{"id":"2df539e1-36bb-4964-9f10-1b938ea7b91b","block_type":"box","text":"using different standards, some of which may be required by regulation. In such cases, we ask that","page_number":490,"box":{"x":117,"y":529,"width":739,"height":12}},{"id":"f9f607ee-4ddc-4ced-91eb-12902a4c6602","block_type":"box","text":"companies highlight the metrics that are industry- or company-specific.","page_number":490,"box":{"x":116,"y":544,"width":530,"height":12}},{"id":"65680198-d827-40ee-a49e-f26618f4a142","block_type":"box","text":"We also recognize that companies may be phasing in reporting over several years. We do not","page_number":490,"box":{"x":116,"y":576,"width":702,"height":11}},{"id":"031f9788-c833-4c7d-bb3d-2b8a4989a365","block_type":"box","text":"prescribe timelines regarding when companies should make sustainability-related disclosures but","page_number":490,"box":{"x":117,"y":591,"width":725,"height":12}},{"id":"9ae0fe4c-baaf-4280-87f6-05dd8744d5e6","block_type":"box","text":"appreciate it when companies produce them sufficiently in advance of their shareholder meeting, to the","page_number":490,"box":{"x":116,"y":606,"width":770,"height":12}},{"id":"2b2133d4-797c-4c4c-bc03-5080a7d702c3","block_type":"box","text":"best of their abilities, to provide investors with time to assess the data and make informed voting","page_number":490,"box":{"x":117,"y":622,"width":718,"height":12}},{"id":"a1c71a57-0d3b-4cc2-9aa2-f35b44765bff","block_type":"box","text":"decisions.","page_number":490,"box":{"x":116,"y":638,"width":79,"height":9}},{"id":"7ae5e344-a4a4-4c9d-b046-c6b461cfd833","block_type":"box","text":"Industry initiatives on managing specific operational risks may also provide useful guidance to","page_number":490,"box":{"x":117,"y":668,"width":695,"height":12}},{"id":"ef847829-002d-4a0a-a7a3-293f373c5e23","block_type":"box","text":"companies on best practices and disclosures. While not a voting item, we find it helpful to our","page_number":490,"box":{"x":116,"y":684,"width":692,"height":12}},{"id":"7368b528-2826-42e4-be7f-b6fa1767b508","block_type":"box","text":"understanding of investment risk when companies disclose any relevant global sustainability-related","page_number":490,"box":{"x":117,"y":699,"width":740,"height":13}},{"id":"46889ef2-fd3a-4c51-88fc-16d057280095","block_type":"box","text":"10","page_number":490,"box":{"x":144,"y":750,"width":8,"height":5}},{"id":"045cc2e6-484e-4035-a83b-2bbf970926d3","block_type":"box","text":"By material sustainability-related risks and opportunities, we mean the drivers of risk and financial value creation in a","page_number":490,"box":{"x":171,"y":750,"width":691,"height":10}},{"id":"cbe54669-6a08-4e11-9749-b96d813ce103","block_type":"box","text":"company’s business model that have an environmental or social dependency or impact. Examples of environmental","page_number":490,"box":{"x":170,"y":763,"width":686,"height":10}},{"id":"2c4512cf-1eba-424f-9545-5d6768bc4c31","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":490,"box":{"x":170,"y":776,"width":682,"height":10}},{"id":"a11cd499-96a3-4f6f-994e-f2bb0beb9048","block_type":"box","text":"issues include, but are not limited to, human capital management, impacts on the communities in which a company","page_number":490,"box":{"x":170,"y":789,"width":683,"height":10}},{"id":"b16e4bca-4e9c-4541-a29c-130b6ab45bf7","block_type":"box","text":"operates, customer loyalty, and relationships with regulators.","page_number":490,"box":{"x":170,"y":802,"width":360,"height":10}},{"id":"47663304-8614-426e-9c3c-a623f314825b","block_type":"box","text":"11","page_number":490,"box":{"x":144,"y":815,"width":7,"height":5}},{"id":"cc5607d9-6963-4c3b-840f-1d87a8678ace","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Reporting Standards (IFRS)","page_number":490,"box":{"x":170,"y":815,"width":666,"height":10}},{"id":"07fb25d4-6ace-4d3d-bec9-970659326141","block_type":"box","text":"Foundation. The standards build on the Task Force on Climate-related Financial Disclosures (TCFD) framework and the","page_number":490,"box":{"x":171,"y":828,"width":712,"height":10}},{"id":"af615363-2178-4f71-b42c-a098988f2186","block_type":"box","text":"standards and metrics developed by the Sustainability Accounting Standards Board (SASB), which have both","page_number":490,"box":{"x":170,"y":841,"width":649,"height":9}},{"id":"f15730f4-3551-41bd-8d97-0217c0a1e7d8","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":490,"box":{"x":170,"y":854,"width":674,"height":9}},{"id":"10219f73-8c80-496f-8488-6cb28c15ab57","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":490,"box":{"x":170,"y":867,"width":647,"height":9}},{"id":"58095f50-50aa-4dc5-87b6-e9b5d97efec1","block_type":"box","text":"Disclosures.” Websites accessed in December 2025.","page_number":490,"box":{"x":171,"y":880,"width":312,"height":7}},{"id":"16f00e68-2af7-4d44-9bd0-e8a62b803a44","block_type":"box","text":"BlackRock Investment Stewardship","page_number":490,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"d67effbd-63dd-4f00-8826-bf1d7008d9b4","block_type":"box","text":"Global Principles |","page_number":490,"box":{"x":726,"y":909,"width":132,"height":12}},{"id":"fb6229b6-22f2-4579-9612-38eeffd8c5b3","block_type":"box","text":"12","page_number":490,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"c8a61e66-17b3-4ed0-a1cd-950305e07db1","block_type":"box","text":"NM1026U-6004382-490/605","page_number":490,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f3d3a934-3f63-4231-ae1d-36379a855c41","block_type":"box","text":"standards adopted, the industry initiatives in which they participate, any peer group benchmarking","page_number":491,"box":{"x":116,"y":87,"width":731,"height":12}},{"id":"bb453310-366b-455b-8da3-4b0386f97b22","block_type":"box","text":"undertaken, and any assurance processes to help investors understand their approach to sustainable","page_number":491,"box":{"x":117,"y":103,"width":758,"height":12}},{"id":"9acca6f6-8827-43c9-bd4a-09d368479d68","block_type":"box","text":"and responsible business practices.","page_number":491,"box":{"x":116,"y":118,"width":271,"height":12}},{"id":"494138fc-4546-4c91-b209-eec02f600e1f","block_type":"box","text":"Climate and nature-related risk","page_number":491,"box":{"x":117,"y":149,"width":250,"height":10}},{"id":"7a5f326a-751a-4a64-879a-2f5a47130f1f","block_type":"box","text":"Many companies are assessing how to navigate the low-carbon transition while delivering long-term","page_number":491,"box":{"x":117,"y":180,"width":745,"height":12}},{"id":"6de7917d-2a17-471f-9d97-bd0b826d8f00","block_type":"box","text":"financial value to investors. For companies facing material climate-related risks, we find it helpful when","page_number":491,"box":{"x":116,"y":196,"width":766,"height":12}},{"id":"dbdd303b-ff33-4c46-a222-675249b9c87b","block_type":"box","text":"they publicly disclose, consistent with their business model and sector, how they intend to deliver long","page_number":491,"box":{"x":116,"y":211,"width":762,"height":12}},{"id":"147146b6-a27a-4960-bdd4-337ffbc5f778","block_type":"box","text":"term financial performance through the low-carbon transition, including where available, their transition","page_number":491,"box":{"x":116,"y":227,"width":766,"height":12}},{"id":"2d582dd5-bcd9-4bf7-83cb-f3f8bc9c4d5f","block_type":"box","text":"plan.","page_number":491,"box":{"x":117,"y":242,"width":34,"height":12}},{"id":"5af10d2d-de9c-4dcf-9d4c-071236c2c159","block_type":"box","text":"12, 13","page_number":491,"box":{"x":153,"y":242,"width":29,"height":7}},{"id":"ade109e1-68df-45b8-8894-02b281bbd972","block_type":"box","text":"From company disclosures and engagement, we seek to understand the strategies","page_number":491,"box":{"x":182,"y":242,"width":626,"height":12}},{"id":"be66c6ac-9f21-4f41-bbfe-a7d4f913828a","block_type":"box","text":"companies have in place to manage material risks to, and opportunities for, their long-term business","page_number":491,"box":{"x":116,"y":258,"width":748,"height":12}},{"id":"9856c800-ad7b-4946-8a65-50bb4043b57c","block_type":"box","text":"model associated with a range of climate-related scenarios.","page_number":491,"box":{"x":117,"y":273,"width":446,"height":12}},{"id":"d4c89cb7-3823-4758-9e84-70fdaec2942f","block_type":"box","text":"Recognizing the value of these disclosures, certain markets such as the European Union mandate","page_number":491,"box":{"x":117,"y":304,"width":734,"height":12}},{"id":"99887a3f-f7ec-4b54-92f1-50fa17e97d7f","block_type":"box","text":"large companies to disclose such climate-related financial information, while in other jurisdictions these","page_number":491,"box":{"x":117,"y":320,"width":767,"height":12}},{"id":"ed5f5547-1954-4dfe-9153-07b5e5d34676","block_type":"box","text":"disclosures are viewed as best practice in the market.","page_number":491,"box":{"x":116,"y":335,"width":404,"height":12}},{"id":"93de5a5b-5fc1-44b2-b1d7-8a111522ff3c","block_type":"box","text":"The ISSB standards provide one such framework that can assist investors in assessing company","page_number":491,"box":{"x":116,"y":366,"width":726,"height":12}},{"id":"1a83d4f8-8c7c-4218-9841-98ec78648d29","block_type":"box","text":"specific climate-related risks and opportunities, and informing investment decisions. Such disclosures","page_number":491,"box":{"x":116,"y":382,"width":757,"height":12}},{"id":"3278d096-3bcc-4b3c-a3ba-41d2a6325503","block_type":"box","text":"also provide investors with insights into how companies are managing the risks associated with a","page_number":491,"box":{"x":116,"y":397,"width":726,"height":12}},{"id":"9c7cd54c-ca79-4f7d-aa1e-6beb31c9e199","block_type":"box","text":"transition to a low-carbon economy by managing their own carbon emissions or emissions intensities","page_number":491,"box":{"x":116,"y":413,"width":754,"height":12}},{"id":"a13fe341-4e54-4db6-aed1-f5e599e6b3aa","block_type":"box","text":"to the extent financially practicable.","page_number":491,"box":{"x":116,"y":428,"width":266,"height":12}},{"id":"4672f596-eee9-4059-88da-2df7b9b82b42","block_type":"box","text":"The ISSB standards, for example, contemplate disclosures on how companies are setting short-,","page_number":491,"box":{"x":116,"y":459,"width":723,"height":12}},{"id":"7b8a1964-cb88-4ca6-8a1c-56fe9163389a","block_type":"box","text":"medium- and long-term targets, ideally science-based where these are available for their sector, for","page_number":491,"box":{"x":117,"y":475,"width":742,"height":12}},{"id":"8c031b5c-4e33-47cf-939a-18c687c5ba56","block_type":"box","text":"scope 1 and 2 greenhouse gas emissions (GHG) reductions and to demonstrate how their targets are","page_number":491,"box":{"x":116,"y":490,"width":760,"height":12}},{"id":"fb6610a9-3b62-4ca7-b740-092db600d8ad","block_type":"box","text":"consistent with the long-term financial interests of their investors.","page_number":491,"box":{"x":116,"y":506,"width":486,"height":12}},{"id":"676edc3c-0c6a-4ed0-8834-c21314731994","block_type":"box","text":"While we recognize that regulators in some markets are moving to mandate certain disclosures, at this","page_number":491,"box":{"x":116,"y":537,"width":766,"height":12}},{"id":"d2607b2c-5d35-4b6d-9e21-38690d0c4f9a","block_type":"box","text":"stage, we view scope 3 emissions differently from scopes 1 and 2, given methodological complexity,","page_number":491,"box":{"x":116,"y":552,"width":749,"height":12}},{"id":"a0776d33-3a46-4265-9f4c-12899104f055","block_type":"box","text":"regulatory uncertainty, concerns about double-counting, and lack of direct control by companies. We","page_number":491,"box":{"x":117,"y":568,"width":749,"height":12}},{"id":"e0572aa6-c853-48ee-aa32-1e489355d3ac","block_type":"box","text":"welcome disclosures and commitments that companies choose to make regarding material scope 3","page_number":491,"box":{"x":116,"y":583,"width":744,"height":12}},{"id":"3b6f443b-29f8-4b70-95c3-e045d2b62755","block_type":"box","text":"emissions and recognize that these are provided on a good-faith basis as methodology develops.","page_number":491,"box":{"x":116,"y":599,"width":728,"height":12}},{"id":"f8ee7298-61d5-43a4-bb4a-bc2d9acbd2e1","block_type":"box","text":"In addition to climate-related risks and opportunities, for companies whose strategies, operations or","page_number":491,"box":{"x":117,"y":630,"width":742,"height":12}},{"id":"8cbe704d-100b-4a44-8b6f-f251aaf46363","block_type":"box","text":"supply chains are materially reliant on natural capital, nature-related risks and opportunities may affect","page_number":491,"box":{"x":116,"y":645,"width":765,"height":12}},{"id":"4f21a55e-cde9-4e16-a536-dee2f0af6980","block_type":"box","text":"12","page_number":491,"box":{"x":144,"y":763,"width":8,"height":5}},{"id":"17d2d194-79f8-477d-a7fd-206e9e7dee07","block_type":"box","text":"We have observed that more companies are developing such plans, and public policymakers in certain markets are","page_number":491,"box":{"x":170,"y":763,"width":685,"height":10}},{"id":"e8d617ff-58fb-44f8-90ad-a92c55bf711c","block_type":"box","text":"signaling their intentions to require them or already have requirements in place, such as Australia, Brazil, and the","page_number":491,"box":{"x":170,"y":776,"width":670,"height":10}},{"id":"0b4c9973-a9d4-44f4-95ec-a12c98422511","block_type":"box","text":"European Union (please see the International Transition Plan Network for information). We view transition plans as a","page_number":491,"box":{"x":171,"y":789,"width":691,"height":10}},{"id":"cc8f17e0-0563-4c10-97ff-6145189e38ee","block_type":"box","text":"method for a company to both internally assess and externally communicate its long-term strategy, ambition, objectives,","page_number":491,"box":{"x":170,"y":802,"width":710,"height":10}},{"id":"786befbf-4b31-4057-b2e0-defd530ee824","block_type":"box","text":"and actions to create financial value through the global transition towards a low-carbon economy. Across the landscape","page_number":491,"box":{"x":170,"y":815,"width":709,"height":10}},{"id":"d52a94a5-946e-41db-9167-ea58e961a28d","block_type":"box","text":"there remains divergence on the objectives of such plans and the details they should contain. While transition plans can","page_number":491,"box":{"x":170,"y":828,"width":710,"height":10}},{"id":"cb88fd7f-2a5a-4718-b38a-2d1f4b3b0a41","block_type":"box","text":"be helpful disclosure, BIS does not make the preparation and production of transition plans a voting issue. BIS may","page_number":491,"box":{"x":170,"y":841,"width":684,"height":9}},{"id":"496538c6-6593-48d5-93dc-39b2a11a0a4b","block_type":"box","text":"engage companies that have chosen to publish a transition plan to understand their planned actions and resource","page_number":491,"box":{"x":170,"y":854,"width":675,"height":9}},{"id":"236cf431-b85b-4cb8-8880-b0770022c3c9","block_type":"box","text":"implications. Website accessed in December 2025.","page_number":491,"box":{"x":170,"y":867,"width":303,"height":9}},{"id":"50f1244b-1f11-48f2-8cfb-af555430e8b8","block_type":"box","text":"13","page_number":491,"box":{"x":144,"y":880,"width":8,"height":5}},{"id":"69e34ec5-91bf-4c1f-b37c-ffc03c8ccff7","block_type":"box","text":"For more information, please see our commentary “Climate-related risks and a low-carbon transition,” December 2025.","page_number":491,"box":{"x":171,"y":880,"width":703,"height":9}},{"id":"7cae33cf-e8d0-406d-97ad-dfc9e464a201","block_type":"box","text":"BlackRock Investment Stewardship","page_number":491,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"88d3ec96-146b-4e47-b50b-4e14ac9ac22e","block_type":"box","text":"Global Principles |","page_number":491,"box":{"x":726,"y":909,"width":132,"height":12}},{"id":"bba93429-7e3f-491a-8c85-b4fdf235000b","block_type":"box","text":"13","page_number":491,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"0dbdb202-f536-4dc1-9383-4f4b30344bd6","block_type":"box","text":"NM1026U-6004382-491/605","page_number":491,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"1a5ba697-7072-4732-8a99-39e0c849fb1b","block_type":"box","text":"their ability to generate long-term financial returns.","page_number":492,"box":{"x":116,"y":87,"width":372,"height":12}},{"id":"c1703dd5-0d94-4ec8-a087-e6f74e3448e7","block_type":"box","text":"14","page_number":492,"box":{"x":491,"y":87,"width":11,"height":6}},{"id":"64f86f03-227b-4801-930c-52d1f62c63dc","block_type":"box","text":"For these companies, we rely on disclosures to","page_number":492,"box":{"x":502,"y":87,"width":360,"height":12}},{"id":"c0e5005f-49c8-4d66-9f3a-f6d584908d18","block_type":"box","text":"understand how their strategies consider nature-related impacts and dependencies and to assess how","page_number":492,"box":{"x":117,"y":103,"width":765,"height":12}},{"id":"5ef041ac-ebbb-49ac-8312-cbcbbfd099d4","block_type":"box","text":"the board oversees these risks.","page_number":492,"box":{"x":116,"y":118,"width":232,"height":10}},{"id":"249bbc68-e72d-4410-984b-9d41d7527b01","block_type":"box","text":"15","page_number":492,"box":{"x":351,"y":118,"width":10,"height":6}},{"id":"63cffa3e-f8bb-4a8c-b616-b943b9744ce1","block_type":"box","text":"Companies’ impact on their workforce, supply chains, and communities","page_number":492,"box":{"x":117,"y":149,"width":579,"height":12}},{"id":"5a0bc07c-7308-435a-be75-87e0386aa282","block_type":"box","text":"Companies determine their key stakeholders based on what is material to their business and long-term","page_number":492,"box":{"x":117,"y":180,"width":768,"height":12}},{"id":"1569f6e6-82ad-46ca-acf2-29d4939a611f","block_type":"box","text":"financial performance. For many companies, key stakeholders include employees, business supply","page_number":492,"box":{"x":116,"y":196,"width":741,"height":12}},{"id":"3ffb79fe-6a93-417f-a2a7-dc7729fc0906","block_type":"box","text":"chains, clients and consumers, regulators, and the communities in which they operate.","page_number":492,"box":{"x":116,"y":211,"width":647,"height":12}},{"id":"60ec6738-d5b9-4ddf-a9ed-7e2e743d264e","block_type":"box","text":"In our experience, companies that invest in the relationships that are critical to their strategic objectives","page_number":492,"box":{"x":117,"y":242,"width":769,"height":12}},{"id":"880634b8-f3b4-49b3-bca5-934e1572e5dd","block_type":"box","text":"are more likely to deliver durable, long-term financial performance. By contrast, we have found that","page_number":492,"box":{"x":116,"y":258,"width":739,"height":12}},{"id":"19ea71ae-1be8-49a5-9602-05c3d485aa64","block_type":"box","text":"poor relationships may create adverse impacts that could expose companies to legal, regulatory,","page_number":492,"box":{"x":117,"y":273,"width":722,"height":12}},{"id":"f71c6a1a-507e-4e86-914d-4fe2a722b6ba","block_type":"box","text":"operational, and reputational risks. This is particularly relevant to a company’s workforce, which is","page_number":492,"box":{"x":116,"y":289,"width":730,"height":12}},{"id":"f8180719-4d67-4c1d-b878-94871af6b736","block_type":"box","text":"central to long-term financial value creation.","page_number":492,"box":{"x":116,"y":304,"width":324,"height":12}},{"id":"5349e6a7-95de-4818-890c-c138127c9a23","block_type":"box","text":"16","page_number":492,"box":{"x":442,"y":304,"width":11,"height":6}},{"id":"73de3c2f-94d0-45dc-a9ee-293ca9ed3379","block_type":"box","text":"As a long-term shareholder on behalf of our clients, we find it helpful when companies disclose how","page_number":492,"box":{"x":116,"y":335,"width":743,"height":12}},{"id":"7ca8d16f-a183-4e89-b43a-56b897182c1b","block_type":"box","text":"they have identified their key stakeholders and considered their interests in business decision-making.","page_number":492,"box":{"x":116,"y":351,"width":763,"height":12}},{"id":"bf57a010-a629-453f-832f-84a2c8e57e64","block_type":"box","text":"In addition to understanding broader stakeholder relationships, BIS finds it helpful when companies","page_number":492,"box":{"x":117,"y":366,"width":740,"height":12}},{"id":"8f5e581c-0d15-44f3-833c-1e344e457db3","block_type":"box","text":"discuss how they consider the needs of their workforce today, and the skills required for their future","page_number":492,"box":{"x":116,"y":382,"width":742,"height":12}},{"id":"af21048c-954f-4f00-861f-c37b1798117c","block_type":"box","text":"business strategy. We are also interested in understanding how the board monitors and engages on","page_number":492,"box":{"x":117,"y":397,"width":747,"height":12}},{"id":"59532500-f086-4002-981a-f85a8f7bb582","block_type":"box","text":"these matters, given it is well positioned to ensure that the approach taken by management is informed","page_number":492,"box":{"x":116,"y":413,"width":770,"height":12}},{"id":"02fb8c2a-6317-46c4-a288-45928f9f05f7","block_type":"box","text":"by and aligns with the company’s strategy. BIS does not direct a company’s policies or practices, which","page_number":492,"box":{"x":117,"y":428,"width":771,"height":12}},{"id":"67463aa8-92cc-457d-8693-d0bc705e0b22","block_type":"box","text":"are the responsibility of management and the board.","page_number":492,"box":{"x":116,"y":444,"width":394,"height":12}},{"id":"65a774f2-b162-4318-a675-07695eb67fdb","block_type":"box","text":"In addition, we find it helpful when companies disclose their approach to addressing material adverse","page_number":492,"box":{"x":117,"y":475,"width":754,"height":12}},{"id":"03c0cb1f-f03e-4998-9925-ddd0d906d8a4","block_type":"box","text":"impacts that could arise from their business practices and affect critical relationships with their","page_number":492,"box":{"x":117,"y":490,"width":701,"height":12}},{"id":"600ceef4-d447-4df0-a950-0bc6fe009645","block_type":"box","text":"stakeholders. We encourage companies to implement, to the extent appropriate, monitoring processes","page_number":492,"box":{"x":116,"y":506,"width":767,"height":12}},{"id":"a11db484-26cd-4d4b-aa0c-a24a83fc12b0","block_type":"box","text":"(often referred to as due diligence) to identify and mitigate potential adverse impacts and grievance","page_number":492,"box":{"x":117,"y":521,"width":740,"height":12}},{"id":"57b7e6d3-cad7-40df-8534-5187444ddb79","block_type":"box","text":"mechanisms to remediate any actual adverse material impacts.","page_number":492,"box":{"x":117,"y":537,"width":474,"height":12}},{"id":"425bb694-790a-49c1-aa9d-85ec3b1f1d17","block_type":"box","text":"We look to boards to oversee management’s approach to addressing material risks related to key","page_number":492,"box":{"x":116,"y":568,"width":729,"height":12}},{"id":"8acb401e-c09f-47f4-8529-5fdb6754a250","block_type":"box","text":"stakeholders and may convey concerns about board oversight in our voting on director elections or","page_number":492,"box":{"x":116,"y":583,"width":739,"height":12}},{"id":"fb13d320-982f-4a4b-921d-0a2da33a1741","block_type":"box","text":"supporting a business relevant shareholder proposal when, in our assessment, the board is not acting","page_number":492,"box":{"x":116,"y":599,"width":761,"height":12}},{"id":"b4e62881-80a9-4de3-b309-d14d94d20f44","block_type":"box","text":"in shareholders’ long-term financial interests.","page_number":492,"box":{"x":117,"y":614,"width":337,"height":12}},{"id":"3fe16383-0fa7-459d-9978-eddbd87c4876","block_type":"box","text":"BlackRock’s oversight of its investment stewardship activities","page_number":492,"box":{"x":251,"y":653,"width":503,"height":12}},{"id":"54a789cf-76e1-4583-846a-1b9a186211fd","block_type":"box","text":"BIS’ governance structure supports oversight and accountability of stewardship-related activities on","page_number":492,"box":{"x":117,"y":684,"width":736,"height":12}},{"id":"f3f5bdcb-3bde-4c25-8a75-987ff82e73c4","block_type":"box","text":"behalf of clients at the global and regional level.","page_number":492,"box":{"x":117,"y":699,"width":352,"height":13}},{"id":"c70cbb42-7b61-4de1-b92e-fa8eecb1d06b","block_type":"box","text":"At the top of this governance structure, the risk-focused BIS Global Oversight Committee (the","page_number":492,"box":{"x":116,"y":730,"width":694,"height":13}},{"id":"f01b7b67-09dc-4718-9527-83ad61e952ac","block_type":"box","text":"Committee) supports BIS’ regulatory responsibilities in relation to proxy voting, including adherence to","page_number":492,"box":{"x":117,"y":746,"width":755,"height":12}},{"id":"481b09cd-991f-49f9-9b34-c1e1354b0189","block_type":"box","text":"14","page_number":492,"box":{"x":144,"y":789,"width":8,"height":5}},{"id":"6d9c4655-33e3-45e2-a53c-c9bb851b87af","block_type":"box","text":"For more information, please see our commentary “Our approach to engagement on natural capital,” December 2025.","page_number":492,"box":{"x":171,"y":789,"width":697,"height":10}},{"id":"20fd26c8-9510-4928-81b9-6396352b36b6","block_type":"box","text":"15","page_number":492,"box":{"x":144,"y":802,"width":8,"height":5}},{"id":"92173b58-2e49-4720-a673-3a26bca350d3","block_type":"box","text":"Given the growing awareness of the materiality of these issues for certain businesses, enhanced reporting on a","page_number":492,"box":{"x":170,"y":802,"width":660,"height":10}},{"id":"a912e78b-232c-4a97-9adf-4418283180da","block_type":"box","text":"company’s natural capital dependencies and impacts would aid investors’ understanding. The recommendations of the","page_number":492,"box":{"x":170,"y":815,"width":704,"height":10}},{"id":"aab8dad9-64cb-4050-811d-264c49b13d97","block_type":"box","text":"Taskforce on Nature-related Financial Disclosures (TNFD) may prove useful to some companies. We recognize that","page_number":492,"box":{"x":170,"y":828,"width":689,"height":10}},{"id":"f45f5458-4119-4c8b-b4ee-2b4ae32886f2","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":492,"box":{"x":170,"y":841,"width":680,"height":9}},{"id":"dbb69a9e-44a9-48e3-95d5-404c5e1b72e0","block_type":"box","text":"other private sector standards. TNFD-aligned reporting is not a voting issue. Website accessed in December 2025.","page_number":492,"box":{"x":170,"y":854,"width":680,"height":9}},{"id":"3f0fb79c-d489-4628-8757-7cc2349859e6","block_type":"box","text":"16","page_number":492,"box":{"x":144,"y":867,"width":8,"height":5}},{"id":"43ed6684-16c8-4145-8112-20f6a7b3986f","block_type":"box","text":"For more information, please see our commentary “Our approach to engagement on human capital management,”","page_number":492,"box":{"x":171,"y":867,"width":677,"height":9}},{"id":"cae06f93-3b27-45e8-a708-4b4be1207550","block_type":"box","text":"December 2025.","page_number":492,"box":{"x":171,"y":880,"width":97,"height":7}},{"id":"3c45706a-ce2a-4e95-b4d6-849c63244a69","block_type":"box","text":"BlackRock Investment Stewardship","page_number":492,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"2e292909-8c8a-403e-9ec8-ae1d5368e214","block_type":"box","text":"Global Principles |","page_number":492,"box":{"x":726,"y":909,"width":132,"height":12}},{"id":"6bfc814e-d5eb-43eb-b6ac-92cb6697fdca","block_type":"box","text":"14","page_number":492,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"57cbd5dd-68a9-4298-bc60-c82833f19acf","block_type":"box","text":"NM1026U-6004382-492/605","page_number":492,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"e9df3839-e5ab-47c8-b247-6e471a8e9ecc","block_type":"box","text":"policies and procedures as well as market-level stewardship requirements. The Committee reviews","page_number":493,"box":{"x":117,"y":87,"width":740,"height":12}},{"id":"2d6805a6-65a7-4967-8c64-8a6943464030","block_type":"box","text":"and approves amendments to the Global Principles and regional voting guidelines. The Committee","page_number":493,"box":{"x":116,"y":102,"width":738,"height":13}},{"id":"00e1d818-b4be-40e7-99e0-e8a50b3527e4","block_type":"box","text":"also reviews periodic reports regarding the votes cast by BIS on behalf of clients, as well as updates","page_number":493,"box":{"x":116,"y":118,"width":749,"height":12}},{"id":"bc13c4bc-51d0-4882-a4e2-e23b42e36f95","block_type":"box","text":"on material process issues, procedural changes, and other risk oversight considerations. The","page_number":493,"box":{"x":116,"y":134,"width":697,"height":12}},{"id":"00123b93-cfe9-4c72-bac8-187d8d231558","block_type":"box","text":"Committee is chaired by the Global Heads of the Investment Stewardship function and its members","page_number":493,"box":{"x":117,"y":149,"width":743,"height":12}},{"id":"ec0e9bc3-1d91-411b-86cb-0255e2513143","block_type":"box","text":"include senior BlackRock executives with legal, risk, and other experience relevant to team oversight","page_number":493,"box":{"x":117,"y":165,"width":752,"height":12}},{"id":"ca0c1956-5ef6-4f29-a0ba-6d4d0c9562db","block_type":"box","text":"who are independent from the investment stewardship function.","page_number":493,"box":{"x":116,"y":180,"width":477,"height":12}},{"id":"48a7c215-ece2-41fa-bdb9-5aa66e3e1cd1","block_type":"box","text":"The Global Heads have primary oversight of BIS’ activities globally, including voting in accordance with","page_number":493,"box":{"x":116,"y":211,"width":769,"height":12}},{"id":"41f0d805-629e-46cc-8fee-34a56762ea73","block_type":"box","text":"the Global Principles and regional voting guidelines. At the regional level, three regional Heads for the","page_number":493,"box":{"x":116,"y":227,"width":761,"height":12}},{"id":"ffc8b012-5c36-4892-99ee-61d4400b9d09","block_type":"box","text":"Americas, APAC, and EMEA oversee BIS’ activities for their specific markets.","page_number":493,"box":{"x":116,"y":242,"width":581,"height":12}},{"id":"78b052fc-bba3-44f5-ab9b-9efac33e847f","block_type":"box","text":"Vote execution","page_number":493,"box":{"x":440,"y":281,"width":124,"height":9}},{"id":"078d7a98-9f7e-4f21-8934-39367b141bcf","block_type":"box","text":"BIS votes proxies on behalf of index equity funds and accounts when authorized by our clients. We","page_number":493,"box":{"x":117,"y":312,"width":739,"height":12}},{"id":"e8cfd2ff-4f87-4945-b438-6ae4ebe1e8c3","block_type":"box","text":"have processes in place to consider all proxies for which we have voting authority, and submit voting","page_number":493,"box":{"x":117,"y":327,"width":751,"height":12}},{"id":"897bd09b-28d4-426f-9c06-d9b7ebbf6190","block_type":"box","text":"decisions, or refrain from voting when logistical issues arise (see below). The BIS Benchmark Policies","page_number":493,"box":{"x":116,"y":343,"width":761,"height":12}},{"id":"cdffe382-1a67-477c-b686-14f99181be8e","block_type":"box","text":"– and the vote decisions made consistent with those policies – reflect our reasonable and independent","page_number":493,"box":{"x":116,"y":358,"width":766,"height":12}},{"id":"6c43ae69-3577-4a78-8060-72c4942c79af","block_type":"box","text":"judgment and are made without regard to the relationship between the issuer of the proxy (or any","page_number":493,"box":{"x":115,"y":374,"width":728,"height":12}},{"id":"e8825002-6051-4c20-91b5-0bd1f6196fef","block_type":"box","text":"shareholder proponent or dissident shareholder) and the Fund, the Fund’s affiliates (if any), BlackRock","page_number":493,"box":{"x":116,"y":389,"width":767,"height":12}},{"id":"fa15a8c3-cf9b-42ab-a5c7-27deb1ee6612","block_type":"box","text":"or BlackRock’s affiliates, or BlackRock employees (see “Conflicts management policies and","page_number":493,"box":{"x":116,"y":405,"width":685,"height":12}},{"id":"db3dbd1a-d444-4067-bbb1-b28cb2828ea5","block_type":"box","text":"procedures,” below).","page_number":493,"box":{"x":117,"y":420,"width":157,"height":12}},{"id":"3e070411-ebbc-42b1-84ed-d65bb6813994","block_type":"box","text":"In certain markets, proxy voting involves logistical issues which can affect BIS’ ability to vote, as well","page_number":493,"box":{"x":117,"y":451,"width":749,"height":12}},{"id":"ffa54e48-c7a5-484b-a5cf-5448ca342896","block_type":"box","text":"as the cost of voting such proxies on behalf of our clients. These issues include, but are not limited to:","page_number":493,"box":{"x":116,"y":467,"width":761,"height":12}},{"id":"eb21ae56-8e87-45a8-a38f-3e8373ea313a","block_type":"box","text":"1) untimely notice of shareholder meetings; 2) restrictions on a foreigner’s ability to exercise votes; 3)","page_number":493,"box":{"x":118,"y":482,"width":754,"height":12}},{"id":"1a64f5d3-a672-4c52-a998-309088e97d9f","block_type":"box","text":"requirements to vote proxies in person; 4) “share-blocking” (requirements that investors who exercise","page_number":493,"box":{"x":117,"y":498,"width":756,"height":12}},{"id":"a5419d9f-cae2-4d9a-a251-a2a3ccf4c19d","block_type":"box","text":"their voting rights surrender the right to dispose of their holdings from the point at which votes are","page_number":493,"box":{"x":116,"y":513,"width":728,"height":12}},{"id":"9beb8238-7a15-42fe-bcfa-f6581bbf3604","block_type":"box","text":"submitted until after the after the shareholder meeting has occurred); 5) potential difficulties in","page_number":493,"box":{"x":116,"y":529,"width":701,"height":12}},{"id":"3d68b9ed-8306-43b8-ba2f-253ce331cbcc","block_type":"box","text":"translating the proxy; 6) regulatory constraints; and 7) requirements to provide local agents with","page_number":493,"box":{"x":116,"y":544,"width":714,"height":12}},{"id":"e0a9ecd7-6384-452f-adcf-9f7e4bd6cb2b","block_type":"box","text":"powers of attorney to facilitate voting instructions. We are not supportive of impediments to the","page_number":493,"box":{"x":117,"y":560,"width":706,"height":12}},{"id":"2e615d34-e702-40c5-8b94-76be278ff4c8","block_type":"box","text":"exercise of voting rights such as share-blocking or overly burdensome administrative requirements.","page_number":493,"box":{"x":116,"y":575,"width":742,"height":12}},{"id":"936528d7-2368-41f1-8626-c08314cb998d","block_type":"box","text":"BIS votes proxies in these situations on a “best-efforts” basis. In addition, BIS may determine that it is","page_number":493,"box":{"x":117,"y":606,"width":758,"height":12}},{"id":"434cea8e-7a51-490d-a8e0-a2a7749965ef","block_type":"box","text":"generally in the interests of BlackRock’s clients not to vote proxies (or not to vote our full allocation) if","page_number":493,"box":{"x":116,"y":622,"width":755,"height":12}},{"id":"a156ae5a-dba7-4fd8-ab2a-fd5b3508e927","block_type":"box","text":"the costs (including but not limited to opportunity costs associated with share-blocking constraints)","page_number":493,"box":{"x":116,"y":637,"width":734,"height":12}},{"id":"51c1bca1-9c65-4ddc-8221-0497f92ccb3f","block_type":"box","text":"associated with exercising a vote are expected to outweigh the benefit the client would derive by voting","page_number":493,"box":{"x":116,"y":653,"width":770,"height":12}},{"id":"1ebfcc15-2724-41e6-8903-1b67caac408b","block_type":"box","text":"on the proposal.","page_number":493,"box":{"x":116,"y":669,"width":119,"height":11}},{"id":"839751c0-fdd8-4395-85e3-f04da713a391","block_type":"box","text":"Conflicts management policies and procedures","page_number":493,"box":{"x":311,"y":707,"width":377,"height":12}},{"id":"ee32b498-c368-4a36-b363-affdac81a2d1","block_type":"box","text":"BIS is a dedicated function whose responsibilities are separate from BlackRock’s sales, business","page_number":493,"box":{"x":117,"y":738,"width":719,"height":12}},{"id":"6fc67e3c-ec0d-4bcc-ac1d-ba692f778fac","block_type":"box","text":"partnership or enterprise-level vendor management activities.","page_number":493,"box":{"x":117,"y":754,"width":454,"height":12}},{"id":"1e2571c5-db2c-49e9-9528-2a4738a6c83b","block_type":"box","text":"BlackRock maintains policies and procedures that are designed to prevent undue influence on BIS’","page_number":493,"box":{"x":117,"y":785,"width":733,"height":12}},{"id":"069788c9-63e2-42a4-83c3-cfe73befab52","block_type":"box","text":"proxy voting activity. 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While this has occurred in a","page_number":494,"box":{"x":117,"y":258,"width":736,"height":12}},{"id":"f3b064fd-f429-4732-9040-fac83a93a1eb","block_type":"box","text":"limited number of cases, the decision to recall securities on loan as part of BlackRock’s securities","page_number":494,"box":{"x":117,"y":273,"width":727,"height":12}},{"id":"1918208f-4b6e-4959-9a47-ca9aca8f4fd2","block_type":"box","text":"lending program in order to vote is based on an evaluation of various factors that include, but are not","page_number":494,"box":{"x":117,"y":289,"width":751,"height":12}},{"id":"7366cc29-a1a9-4761-baf5-8ad978bb62f7","block_type":"box","text":"limited to, assessing potential securities lending revenue alongside the potential long-term financial","page_number":494,"box":{"x":117,"y":304,"width":739,"height":12}},{"id":"777fabcf-8027-4a95-abb9-79b6a9811b43","block_type":"box","text":"value to clients of voting those securities (based on the information available at the time of recall","page_number":494,"box":{"x":116,"y":320,"width":719,"height":12}},{"id":"54d6bebe-148c-4723-97aa-386204e2fcf7","block_type":"box","text":"consideration).","page_number":494,"box":{"x":116,"y":335,"width":109,"height":12}},{"id":"b27a2f01-4764-4a6a-8c82-191f43dd9e43","block_type":"box","text":"17","page_number":494,"box":{"x":227,"y":335,"width":11,"height":6}},{"id":"1ef18f31-74fd-43c9-ac5f-648528578596","block_type":"box","text":"BIS works with colleagues in the Securities Lending and Risk and Quantitative","page_number":494,"box":{"x":238,"y":335,"width":591,"height":12}},{"id":"df6e0ec9-3372-4db2-8ec4-8270c2d9bcda","block_type":"box","text":"Analysis teams to evaluate the costs and benefits to clients of recalling shares on loan.","page_number":494,"box":{"x":116,"y":351,"width":650,"height":12}},{"id":"523c564b-3172-4d19-b552-579170a8fa86","block_type":"box","text":"In almost all instances, BlackRock anticipates that the potential long-term financial value to clients of","page_number":494,"box":{"x":117,"y":382,"width":749,"height":12}},{"id":"44d82853-6c85-4c51-bb7f-c250a48f61a6","block_type":"box","text":"voting shares would be less than the potential revenue the loan may provide clients. 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Accordingly, it is not practicable to","page_number":494,"box":{"x":170,"y":763,"width":661,"height":10}},{"id":"20291a38-0733-46b1-8a5f-94ea25c22699","block_type":"box","text":"evaluate a proxy statement, determine that a vote has a material impact on a fund and recall any shares on loan in","page_number":494,"box":{"x":170,"y":776,"width":679,"height":10}},{"id":"296bf508-c319-4f36-ba3e-658df338beb9","block_type":"box","text":"advance of the record date for the annual meeting. As a result, managers must weigh independent business judgement","page_number":494,"box":{"x":170,"y":789,"width":708,"height":10}},{"id":"e0b3c6d5-2cef-43f8-a4a1-bfca6f9e8b2d","block_type":"box","text":"as a fiduciary, the benefit to a fund’s shareholders of recalling loaned shares in advance of an estimated record date","page_number":494,"box":{"x":170,"y":802,"width":689,"height":10}},{"id":"dd33613a-cca4-4029-abed-e4af71b49dbf","block_type":"box","text":"without knowing whether there will be a vote on matters which have a material impact on the fund (thereby forgoing","page_number":494,"box":{"x":170,"y":815,"width":683,"height":10}},{"id":"9a98d8fb-9441-4960-b0bd-350b28603421","block_type":"box","text":"potential securities lending revenue for the fund’s shareholders) or leaving shares on loan to potentially earn revenue","page_number":494,"box":{"x":170,"y":828,"width":694,"height":10}},{"id":"83e3aea4-b17a-4455-8854-70d89fd9052f","block_type":"box","text":"for the fund (thereby forgoing the opportunity to vote).","page_number":494,"box":{"x":170,"y":841,"width":317,"height":9}},{"id":"9a3fcd25-3cbb-4dd5-a7b2-49bc2791ab56","block_type":"box","text":"18","page_number":494,"box":{"x":144,"y":854,"width":8,"height":5}},{"id":"53e0e879-d07a-48e8-960f-2930b26e42e0","block_type":"box","text":"BlackRock will determine eligibility criteria under this program based upon, among other things, local market regulation","page_number":494,"box":{"x":171,"y":854,"width":702,"height":9}},{"id":"5f9f2d47-d2a1-44cd-8942-c748466495ce","block_type":"box","text":"and practice, cost considerations, operational risk and/or complexity, and financial considerations, including the decision","page_number":494,"box":{"x":170,"y":867,"width":712,"height":9}},{"id":"4e5aa0ce-d8ab-4c84-93be-cc66db71ae23","block_type":"box","text":"to lend securities.","page_number":494,"box":{"x":170,"y":880,"width":103,"height":7}},{"id":"2fc02f58-b0a0-4f7e-a148-a59b15124d3e","block_type":"box","text":"BlackRock Investment Stewardship","page_number":494,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"1cfd570f-303e-4626-831c-2c5fd8d779af","block_type":"box","text":"Global Principles |","page_number":494,"box":{"x":726,"y":909,"width":132,"height":12}},{"id":"df1dc3c7-53df-4061-8e79-4b670407495e","block_type":"box","text":"16","page_number":494,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"33546ac2-198f-4ad7-a4a5-4a444b77c26a","block_type":"box","text":"NM1026U-6004382-494/605","page_number":494,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"8bba93cc-d7d1-4bbe-aada-ac9cf14945de","block_type":"box","text":"strategies.","page_number":495,"box":{"x":116,"y":87,"width":76,"height":12}},{"id":"5a473f79-7647-4d8d-997d-085917acdb16","block_type":"box","text":"19","page_number":495,"box":{"x":195,"y":87,"width":10,"height":6}},{"id":"ee18fdde-299f-4544-86ca-cd8c8ce36b1b","block_type":"box","text":"Voting Choice is also available for eligible U.S. retail shareholder accounts invested in","page_number":495,"box":{"x":205,"y":87,"width":648,"height":12}},{"id":"8065af8b-44af-4fbb-a23a-85c2853bfcd6","block_type":"box","text":"BlackRock’s largest U.S. exchange-traded fund.","page_number":495,"box":{"x":117,"y":102,"width":354,"height":13}},{"id":"e90fc324-0fff-4820-bbd1-e302963230a4","block_type":"box","text":"20","page_number":495,"box":{"x":473,"y":103,"width":12,"height":6}},{"id":"cad53d46-26ed-4980-a16a-9929495e47b4","block_type":"box","text":"As a result, the shares attributed to BlackRock portfolios in company share registers may be voted","page_number":495,"box":{"x":116,"y":134,"width":735,"height":12}},{"id":"f7f85189-d2e0-494c-b710-b4a49085dccf","block_type":"box","text":"differently depending on whether our clients have authorized BIS to vote on their behalf, have","page_number":495,"box":{"x":116,"y":149,"width":699,"height":12}},{"id":"f97fcfb3-0d01-4c3a-8b49-0126a8c13014","block_type":"box","text":"authorized BIS to vote in accordance with a third-party policy, or have elected to vote shares in","page_number":495,"box":{"x":116,"y":165,"width":709,"height":12}},{"id":"d6bd5aa5-1a06-4b6f-ade2-458c9b1e5eaf","block_type":"box","text":"accordance with their own policy. Our clients have greater control over proxy voting because of Voting","page_number":495,"box":{"x":116,"y":180,"width":763,"height":12}},{"id":"06534c45-372e-4575-8b88-c099454eed9f","block_type":"box","text":"Choice.","page_number":495,"box":{"x":117,"y":196,"width":54,"height":9}},{"id":"a7186394-363b-4b34-a898-b33d42d882ab","block_type":"box","text":"21","page_number":495,"box":{"x":173,"y":196,"width":10,"height":6}},{"id":"835af6ab-462d-4262-9775-ffd6efb9320e","block_type":"box","text":"Reporting and vote transparency","page_number":495,"box":{"x":369,"y":234,"width":267,"height":12}},{"id":"ecf23236-da09-4a31-b4ab-e1fa53d1086d","block_type":"box","text":"We are committed to transparency of the stewardship work we do on behalf of clients. We inform","page_number":495,"box":{"x":116,"y":265,"width":724,"height":12}},{"id":"2c0d2d3b-7672-4920-8a0e-4d06068eb419","block_type":"box","text":"clients about our engagement and voting policies and activities through direct communication and","page_number":495,"box":{"x":116,"y":281,"width":729,"height":12}},{"id":"4eada778-8d3f-4b0c-9436-a1be1f6ec79c","block_type":"box","text":"through disclosure on our website. We make public our regional voting guidelines for the benefit of","page_number":495,"box":{"x":116,"y":296,"width":735,"height":12}},{"id":"bb01457e-4663-4eba-a68b-c1c5d59330ee","block_type":"box","text":"clients and the companies in which we invest on their behalf. We also publish commentaries to share","page_number":495,"box":{"x":116,"y":312,"width":755,"height":12}},{"id":"94447935-99d1-4d15-a48e-7d701566cca3","block_type":"box","text":"our approach to engagement on our five engagement priorities, as well as quarterly reports detailing","page_number":495,"box":{"x":116,"y":327,"width":748,"height":12}},{"id":"44d9e6d4-be2f-4c6b-9f6e-98a49a3d3b5b","block_type":"box","text":"our proxy voting and engagement activities.","page_number":495,"box":{"x":116,"y":343,"width":329,"height":12}},{"id":"55b5d7f9-2963-4734-9022-d9434b39a1c9","block_type":"box","text":"19","page_number":495,"box":{"x":144,"y":828,"width":8,"height":5}},{"id":"0743711c-591b-43af-9ccd-b1b89e9f0212","block_type":"box","text":"With Voting Choice, SMA clients have the ability to select the policy that best aligns with their views and preferences","page_number":495,"box":{"x":170,"y":828,"width":690,"height":10}},{"id":"478a1085-48bf-4719-a496-2a2bde4d8195","block_type":"box","text":"from a set of voting policies from third-party proxy advisers. 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Under the Guidelines, the dedicated team makes decisions on how to","page_number":501,"box":{"x":184,"y":645,"width":644,"height":12}},{"id":"4554d99f-c4f5-44a2-a532-f01ff60d3dee","block_type":"box","text":"engage companies and vote proxies independently, based on its professional judgment of the","page_number":501,"box":{"x":184,"y":661,"width":694,"height":12}},{"id":"e0ea9bfe-d887-48c2-8938-c9eee81c7b70","block_type":"box","text":"priorities and outcomes most aligned with participating clients’ investment objectives.","page_number":501,"box":{"x":184,"y":676,"width":628,"height":12}},{"id":"455b2338-a31e-41f1-9ed6-ce5a212f3a88","block_type":"box","text":"Voting approach under the Guidelines","page_number":501,"box":{"x":341,"y":713,"width":304,"height":12}},{"id":"155c1bcd-328b-46c4-82c9-4d6f3ffa8c02","block_type":"box","text":"12","page_number":501,"box":{"x":647,"y":713,"width":11,"height":6}},{"id":"a353dac8-8b57-47c7-a41e-aef8384e3d53","block_type":"box","text":"When evaluating each voting item across management or shareholder proposals, the dedicated team","page_number":501,"box":{"x":116,"y":743,"width":752,"height":12}},{"id":"7b3004b9-f6a6-4c71-b2ba-9f2c7890da0a","block_type":"box","text":"applies a case-by-case approach that reflects the uneven pace of the low-carbon transition across","page_number":501,"box":{"x":116,"y":758,"width":728,"height":12}},{"id":"15fb062c-e640-4e51-b856-9fee89e79846","block_type":"box","text":"sectors and markets, and acknowledges the distinction between what company management can","page_number":501,"box":{"x":116,"y":774,"width":723,"height":12}},{"id":"40ffcd50-0285-4174-a531-7b4905ae189c","block_type":"box","text":"influence and what lies beyond its control. As a result, voting decisions – on behalf of in-scope funds","page_number":501,"box":{"x":117,"y":789,"width":744,"height":12}},{"id":"77a67e6b-e262-4012-8234-b6bf19ad87e9","block_type":"box","text":"11","page_number":501,"box":{"x":144,"y":815,"width":7,"height":4}},{"id":"0ab7be3e-bef5-4d89-8f88-3d354d30e521","block_type":"box","text":"Aladdin","page_number":501,"box":{"x":170,"y":815,"width":44,"height":7}},{"id":"cfccaf8f-3094-4a06-a108-5ad48d326c4e","block_type":"box","text":"®","page_number":501,"box":{"x":215,"y":814,"width":7,"height":5}},{"id":"0537590a-36b4-472a-90e6-1c3aeeb107e2","block_type":"box","text":"Climate is a suite of climate analytics including forward-looking scenario analysis and net zero alignment","page_number":501,"box":{"x":226,"y":814,"width":620,"height":10}},{"id":"93e6598c-e648-4380-b310-518261ec0fcf","block_type":"box","text":"analytics. Aladdin","page_number":501,"box":{"x":170,"y":827,"width":103,"height":10}},{"id":"2b0920ce-264a-4f3b-91d5-244f79fab040","block_type":"box","text":"®","page_number":501,"box":{"x":274,"y":827,"width":8,"height":5}},{"id":"5ed726ea-67e3-4aeb-84a6-8caebcf4b47c","block_type":"box","text":"is a proprietary investment and risk management platform.","page_number":501,"box":{"x":286,"y":827,"width":345,"height":10}},{"id":"a81c3044-476d-466f-a082-ce7649629628","block_type":"box","text":"12","page_number":501,"box":{"x":144,"y":840,"width":8,"height":5}},{"id":"249c5d63-559c-414e-a3f6-7f7a105e5483","block_type":"box","text":"These Guidelines are not intended to limit the analysis of individual issues at specific companies or provide a guide as","page_number":501,"box":{"x":170,"y":840,"width":701,"height":10}},{"id":"de20c911-dbaf-426b-8852-d166aaa87394","block_type":"box","text":"to how the dedicated team will engage and/or vote in every instance. The Guidelines are applied by the dedicated team","page_number":501,"box":{"x":170,"y":853,"width":708,"height":10}},{"id":"a3fffe68-0509-49d4-ab9c-d2723df1a2dd","block_type":"box","text":"with discretion, on a case-by-case basis, taking into consideration the range of issues and facts specific to the","page_number":501,"box":{"x":170,"y":866,"width":651,"height":10}},{"id":"d7ef6b1e-681d-41d2-89b3-36650a8304b4","block_type":"box","text":"company, as well as individual ballot items at shareholder meetings.","page_number":501,"box":{"x":170,"y":879,"width":403,"height":10}},{"id":"eea98943-c132-4004-add0-9b0181cb10d8","block_type":"box","text":"BlackRock Investment Stewardship","page_number":501,"box":{"x":117,"y":909,"width":277,"height":12}},{"id":"3355c0ca-8bfe-444c-afd8-0b42b77a8471","block_type":"box","text":"Climate and Decarbonization St","page_number":501,"box":{"x":504,"y":909,"width":213,"height":9}},{"id":"6798f95c-60e2-439c-b9c4-212811dc05ee","block_type":"box","text":"ewardship Guidelines |","page_number":501,"box":{"x":717,"y":909,"width":152,"height":12}},{"id":"333dcadd-fcb7-4349-9aee-7be0a8c3869b","block_type":"box","text":"5","page_number":501,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"093f2fbb-c37e-44cc-812e-d00ae5e5245f","block_type":"box","text":"NM1026U-6004382-501/605","page_number":501,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"92c01a51-a0ab-4f7a-82b3-42db7e970d76","block_type":"box","text":"and SMAs – on similar proposals included on different companies’ shareholder meeting agendas may","page_number":502,"box":{"x":116,"y":87,"width":760,"height":12}},{"id":"36a93494-51f8-46d4-9d72-c2a16de2f75c","block_type":"box","text":"vary depending on company, sector, or market-specific circumstances.","page_number":502,"box":{"x":116,"y":102,"width":530,"height":13}},{"id":"50c06dba-2a07-4b40-8707-e78086831550","block_type":"box","text":"Consistent with the investment objective of each fund or account that has selected these Guidelines,","page_number":502,"box":{"x":117,"y":134,"width":750,"height":12}},{"id":"f1a1914e-4d9a-4e11-877a-2f86890a051a","block_type":"box","text":"the dedicated team will look to the companies to demonstrate the following:","page_number":502,"box":{"x":116,"y":149,"width":564,"height":12}},{"id":"94d310d7-f3b5-4e8e-9dc2-94a9127c8e2e","block_type":"box","text":"Corporate Disclosures","page_number":502,"box":{"x":117,"y":180,"width":179,"height":12}},{"id":"263bebf5-7ee8-4f18-9f65-bb59c5960ef9","block_type":"box","text":"13","page_number":502,"box":{"x":297,"y":180,"width":11,"height":6}},{"id":"9bcae90b-1baa-4d22-99e8-cc60368c1c18","block_type":"box","text":"In the context of these Guidelines, the dedicated team looks for companies to provide sufficient","page_number":502,"box":{"x":117,"y":211,"width":710,"height":12}},{"id":"962070e5-235b-4ef4-89b4-bc14ec959ec2","block_type":"box","text":"disclosure to assess whether the company’s strategy is aligned with the low-carbon transition. As a","page_number":502,"box":{"x":116,"y":227,"width":740,"height":12}},{"id":"09e7b5c3-8cae-4686-876e-c750f25c16cd","block_type":"box","text":"general point, the team looks to companies that are important to the transition to a low-carbon","page_number":502,"box":{"x":116,"y":242,"width":702,"height":12}},{"id":"1c254856-a8c5-4c32-8cc1-47736f19dd80","block_type":"box","text":"economy to explain the strategy and governance frameworks that they have determined most","page_number":502,"box":{"x":116,"y":258,"width":700,"height":12}},{"id":"e3f8915b-b3b9-4895-8624-0dbfeea40cdf","block_type":"box","text":"appropriate, which may include:","page_number":502,"box":{"x":116,"y":273,"width":241,"height":12}},{"id":"359af6b9-e5bc-4c83-b6b0-bb2a0b56cde8","block_type":"box","text":"(1) a low-carbon transition strategy to demonstrate their alignment with the ambition to limit","page_number":502,"box":{"x":150,"y":304,"width":688,"height":12}},{"id":"26a9e5a0-5bcb-4161-8f9f-14c0d36aa0ca","block_type":"box","text":"average global temperature rise to 1.5°C above pre-industrial levels. This would typically","page_number":502,"box":{"x":184,"y":320,"width":661,"height":12}},{"id":"f0df69c6-ca8d-4931-a7a6-26be1dd975af","block_type":"box","text":"include a long-term strategy to achieve net-zero GHG emissions by 2050, with appropriate","page_number":502,"box":{"x":184,"y":335,"width":676,"height":12}},{"id":"466f7813-13f8-40cc-98c8-7e8ae941b821","block_type":"box","text":"near- and medium-term milestones to assess their progress.","page_number":502,"box":{"x":184,"y":351,"width":453,"height":12}},{"id":"83a2056b-3f0e-4a54-bc7e-65deb2cdcdfb","block_type":"box","text":"(2) low-carbon transition-related reporting. Standardized disclosure of sustainability-related data","page_number":502,"box":{"x":150,"y":374,"width":724,"height":12}},{"id":"5009ede5-27e8-485c-b9da-d17bb1d16d6a","block_type":"box","text":"supports investors in making informed decisions. The International Sustainability Standards","page_number":502,"box":{"x":184,"y":389,"width":683,"height":12}},{"id":"1c7d762a-07b9-4b2e-9cbc-98fbb73360c9","block_type":"box","text":"Board (ISSB) standards, IFRS S1 and S2, represent one such approach to standardization","page_number":502,"box":{"x":184,"y":405,"width":678,"height":12}},{"id":"0256d181-f135-4250-be37-28ab54199ef9","block_type":"box","text":"that the dedicated team finds useful in its analysis.","page_number":502,"box":{"x":183,"y":420,"width":374,"height":12}},{"id":"e643da25-c4e6-4db0-bfc2-54749d8ae2ad","block_type":"box","text":"14","page_number":502,"box":{"x":559,"y":420,"width":11,"height":7}},{"id":"06ae7dba-3f2a-45a4-ad8a-23769c837b97","block_type":"box","text":",","page_number":502,"box":{"x":572,"y":428,"width":8,"height":4}},{"id":"a92eef49-28a7-4881-be83-21b740fb4b0d","block_type":"box","text":"15","page_number":502,"box":{"x":581,"y":420,"width":11,"height":7}},{"id":"779df0dc-da68-4330-8fc1-2310f1691c1b","block_type":"box","text":"IFRS S1 addresses the general","page_number":502,"box":{"x":592,"y":420,"width":244,"height":12}},{"id":"81ca95ec-67da-4611-a6e9-c742bce3c605","block_type":"box","text":"requirements of sustainability reporting and IFRS S2 sets out the disclosures that provide","page_number":502,"box":{"x":184,"y":436,"width":667,"height":12}},{"id":"2735b68a-7a86-4437-9d5c-3c9dc0555e63","block_type":"box","text":"investors with decision-useful information about a company’s most significant climate- and","page_number":502,"box":{"x":184,"y":451,"width":674,"height":12}},{"id":"177edb09-3d23-447b-bc14-d7897598ee45","block_type":"box","text":"low-carbon transition-related risks and opportunities. This includes receiving independent,","page_number":502,"box":{"x":184,"y":467,"width":671,"height":12}},{"id":"046e59ac-451e-41d2-8a75-7f4bc07c0e00","block_type":"box","text":"third-party assurances, as audit and assurance standards are developed.","page_number":502,"box":{"x":183,"y":482,"width":549,"height":12}},{"id":"5d998200-23ce-434a-9ec1-9cd2bcda240c","block_type":"box","text":"(3) scope 1 and scope 2, and most significant scope 3 GHG emissions.","page_number":502,"box":{"x":150,"y":506,"width":536,"height":12}},{"id":"14fcc44c-a7a7-48c2-9d74-a0616d07e8b4","block_type":"box","text":"16","page_number":502,"box":{"x":689,"y":506,"width":10,"height":6}},{"id":"059fd080-8aff-4e96-b6d7-6328535b0055","block_type":"box","text":",","page_number":502,"box":{"x":701,"y":514,"width":8,"height":3}},{"id":"9e35c2a4-b98c-4e90-9e16-e2bfd325ccab","block_type":"box","text":"17","page_number":502,"box":{"x":710,"y":506,"width":11,"height":6}},{"id":"a5c3ebbc-78be-46d3-a387-d47cd9760aa4","block_type":"box","text":"In addition, the","page_number":502,"box":{"x":721,"y":506,"width":120,"height":11}},{"id":"dee63165-0edb-4132-a0ed-3f056def3448","block_type":"box","text":"dedicated team looks to companies to disclose their emissions reduction targets for scope 1","page_number":502,"box":{"x":184,"y":521,"width":687,"height":12}},{"id":"e5e1bd35-8b8e-4a5d-98ff-62da36b68dee","block_type":"box","text":"and 2 emissions, science-based where possible. The team welcomes disclosure of targets or","page_number":502,"box":{"x":184,"y":537,"width":695,"height":12}},{"id":"3bc61a19-0422-4b9f-bef5-e82511b12b17","block_type":"box","text":"indicative goals, where companies have set them, for scope 3 emissions reductions. Scope 3","page_number":502,"box":{"x":184,"y":552,"width":696,"height":12}},{"id":"02a5ca24-bf9b-46da-8fed-d40a5deb7a4f","block_type":"box","text":"13","page_number":502,"box":{"x":144,"y":583,"width":8,"height":4}},{"id":"67d9f1e8-89e4-4828-aefe-48689f5499a8","block_type":"box","text":"Given data and measurement limitations, companies may need to provide estimated GHG emissions where reporting","page_number":502,"box":{"x":170,"y":582,"width":695,"height":10}},{"id":"a84a4b2e-ecf5-449c-af10-a42b26426a79","block_type":"box","text":"methodologies are nascent. In addition, certain disclosures related to a company’s plans for adapting their business","page_number":502,"box":{"x":170,"y":595,"width":686,"height":10}},{"id":"6f740ddf-cc64-4bf2-a0a2-564aea899e2d","block_type":"box","text":"models through the low-carbon transition may require forward-looking statements.","page_number":502,"box":{"x":170,"y":608,"width":485,"height":10}},{"id":"eefd9a96-8f59-4eac-9d60-2eea74ad1532","block_type":"box","text":"14","page_number":502,"box":{"x":144,"y":621,"width":8,"height":5}},{"id":"2de3c69a-bef7-453f-ad38-ed03e7f9563a","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Reporting Standards (IFRS)","page_number":502,"box":{"x":170,"y":621,"width":666,"height":10}},{"id":"f7ec359c-cdc9-4339-aec7-2bbaa0d424a0","block_type":"box","text":"Foundation. The standards build on the Task Force on Climate-related Financial Disclosures (TCFD) framework and the","page_number":502,"box":{"x":171,"y":634,"width":712,"height":10}},{"id":"30264916-1961-4f8a-965e-0271f10b0e9f","block_type":"box","text":"standards and metrics developed by the Sustainability Accounting Standards Board (SASB), which have both","page_number":502,"box":{"x":170,"y":647,"width":649,"height":10}},{"id":"abd38bb8-f540-4f0d-ac7e-2051fdf69fe9","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":502,"box":{"x":170,"y":660,"width":674,"height":10}},{"id":"3ff6605a-84c8-49e1-be6b-4e90d698b840","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":502,"box":{"x":170,"y":673,"width":647,"height":10}},{"id":"53c7e544-b779-4c36-beaa-e4b3c5f661ce","block_type":"box","text":"Disclosures.” Websites accessed in December 2025.","page_number":502,"box":{"x":171,"y":686,"width":312,"height":7}},{"id":"1e0c5fab-188f-43d1-a740-583c4990be17","block_type":"box","text":"15","page_number":502,"box":{"x":144,"y":699,"width":8,"height":5}},{"id":"f503808d-f171-4f39-b9b7-7d9b6ed86248","block_type":"box","text":"A number of jurisdictions are consulting on adopting the standards issued to date or have already committed to doing","page_number":502,"box":{"x":170,"y":699,"width":694,"height":9}},{"id":"bfac0577-573f-4f8b-bcb9-169ca856e2eb","block_type":"box","text":"so. BIS does not mandate any specific disclosure framework companies should use, and recognize that some","page_number":502,"box":{"x":170,"y":712,"width":651,"height":9}},{"id":"452f9581-6122-4998-8bcc-5fc04ab52bf0","block_type":"box","text":"companies may report using different standards, some of which may be required by regulation. In such cases, we ask","page_number":502,"box":{"x":170,"y":725,"width":698,"height":9}},{"id":"1be0144c-4c1c-4f07-bb9d-bd3f2cc8e554","block_type":"box","text":"that companies highlight the metrics that are industry- or company-specific. We also recognize that companies may be","page_number":502,"box":{"x":170,"y":737,"width":703,"height":10}},{"id":"44530ef9-3947-4761-89a6-40dd5d4a976f","block_type":"box","text":"phasing in reporting over several years. We do not prescribe timelines regarding when companies should make","page_number":502,"box":{"x":170,"y":750,"width":661,"height":10}},{"id":"c66d7331-080c-4d9d-81a4-928fbc569d3f","block_type":"box","text":"sustainability-related disclosures but appreciate it when companies produce them sufficiently in advance of their","page_number":502,"box":{"x":170,"y":763,"width":664,"height":10}},{"id":"e4f55828-4195-4859-ae7b-fc9aabf02dda","block_type":"box","text":"shareholder meeting, to the best of their abilities, to provide investors with time to assess the data and make informed","page_number":502,"box":{"x":170,"y":776,"width":698,"height":10}},{"id":"5524f2fc-b962-4848-9262-780c71d59d03","block_type":"box","text":"voting decisions.","page_number":502,"box":{"x":170,"y":789,"width":98,"height":10}},{"id":"6abb4727-511d-4a82-ae7e-7b97ad64d560","block_type":"box","text":"16","page_number":502,"box":{"x":144,"y":802,"width":8,"height":5}},{"id":"a41edd15-fb7e-42fb-84a0-bff5e5066d93","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":502,"box":{"x":171,"y":802,"width":685,"height":10}},{"id":"a5ea633e-06cc-450f-b74e-5c22111193ca","block_type":"box","text":"paper: FTSE Russel, “Scope for improvement: Solving the Scope 3 conundrum,” January 2024, accessed in December","page_number":502,"box":{"x":170,"y":815,"width":708,"height":10}},{"id":"ad6d998b-3692-4744-aa3c-076d0882f43e","block_type":"box","text":"2025.","page_number":502,"box":{"x":170,"y":828,"width":32,"height":8}},{"id":"d98a6b35-5369-47c1-be60-02616f74b1d7","block_type":"box","text":"17","page_number":502,"box":{"x":144,"y":841,"width":8,"height":5}},{"id":"5979a598-8e16-47e0-b3f0-7ffe0251b676","block_type":"box","text":"Under this policy, the dedicated team looks for GHG emissions disclosures to be aligned with the Greenhouse Gas","page_number":502,"box":{"x":171,"y":841,"width":680,"height":9}},{"id":"6b241c96-c6b6-476a-bb06-569410fd0db3","block_type":"box","text":"Protocol (GHG Protocol). The Protocol Standards and Guidance are currently being updated to ensure they continue to","page_number":502,"box":{"x":171,"y":854,"width":706,"height":9}},{"id":"0eefc215-0041-4188-952b-453dee61b313","block_type":"box","text":"provide “a rigorous and credible accounting foundation for businesses to measure, plan and track progress toward","page_number":502,"box":{"x":170,"y":867,"width":677,"height":9}},{"id":"c09e8150-ca9d-454c-801b-d5f9f2548cd9","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":502,"box":{"x":170,"y":880,"width":650,"height":9}},{"id":"1dbc0769-b05a-4488-a731-c1c45ac37f5d","block_type":"box","text":"BlackRock Investment Stewardship","page_number":502,"box":{"x":117,"y":909,"width":277,"height":12}},{"id":"c724b3ce-cb12-4401-abc0-839ec313a881","block_type":"box","text":"Climate and Decarbonization St","page_number":502,"box":{"x":504,"y":909,"width":213,"height":9}},{"id":"11d556ab-76a5-4761-b3ce-3c4dbc385e96","block_type":"box","text":"ewardship Guidelines |","page_number":502,"box":{"x":717,"y":909,"width":152,"height":12}},{"id":"c349c751-9dea-417f-b392-c6b43238ea4d","block_type":"box","text":"6","page_number":502,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"958d08f2-0598-45c8-83cd-3b6a5fa8ebe2","block_type":"box","text":"NM1026U-6004382-502/605","page_number":502,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"49d16fed-29f4-4af9-b0f5-4d17896f87ba","block_type":"box","text":"information, including how a company is working with its value chain to accelerate reductions","page_number":503,"box":{"x":184,"y":87,"width":694,"height":12}},{"id":"1ce88e25-770e-4389-9e5c-ff7b094e7e99","block_type":"box","text":"in GHG intensity, provides useful insight to investors focused on investing in the low-carbon","page_number":503,"box":{"x":184,"y":102,"width":684,"height":13}},{"id":"17fa1eef-0413-4436-8c17-5c2f5a5d709d","block_type":"box","text":"transition and understanding the impact of their investments on their decarbonization goals.","page_number":503,"box":{"x":183,"y":118,"width":678,"height":12}},{"id":"0bb733d3-87fb-4b67-afaa-9187003e876c","block_type":"box","text":"18","page_number":503,"box":{"x":864,"y":118,"width":10,"height":6}},{"id":"b9e821a6-fbf8-42ed-9f15-18e0c49c1b6b","block_type":"box","text":"However, the team recognizes that companies have varying ability to influence the emissions","page_number":503,"box":{"x":184,"y":134,"width":696,"height":12}},{"id":"a87c4f4a-7cb6-4b83-b5e2-cedb34f243b8","block_type":"box","text":"across the different parts of their value chain and, therefore, it is helpful when disclosures","page_number":503,"box":{"x":184,"y":149,"width":667,"height":12}},{"id":"09d79329-4cda-4215-aec2-b2f75d4ac9fa","block_type":"box","text":"explain the implications for the achievement of their decarbonization targets. For some","page_number":503,"box":{"x":184,"y":165,"width":647,"height":12}},{"id":"e4a5462c-7a60-44a2-96e9-ae9657a9c9db","block_type":"box","text":"companies that play an important role in the low-carbon transition, scope 3 may represent","page_number":503,"box":{"x":184,"y":180,"width":671,"height":12}},{"id":"9743ee20-e3d4-46ed-b2aa-92a44fa01155","block_type":"box","text":"their only significant source of GHG emissions in the value chain. While we do not believe","page_number":503,"box":{"x":183,"y":196,"width":672,"height":12}},{"id":"1aa7fab0-e184-4177-92dd-e60520527e91","block_type":"box","text":"companies should be required to enforce emissions reduction targets outside of their control,","page_number":503,"box":{"x":184,"y":211,"width":693,"height":12}},{"id":"8dd68095-4c9b-4b8f-93e5-fed8de2aec89","block_type":"box","text":"where relevant, we look for disclosures on how the company approaches the low-carbon","page_number":503,"box":{"x":183,"y":227,"width":662,"height":12}},{"id":"bb692267-98e8-4687-b83c-61d573ee159b","block_type":"box","text":"transition in these cases. This may include plans and targets to grow businesses that","page_number":503,"box":{"x":183,"y":242,"width":636,"height":12}},{"id":"c70229b8-0eb0-495e-81ce-b42ee6157903","block_type":"box","text":"contribute to real world decarbonization, forward-looking capital or procurement allocation","page_number":503,"box":{"x":184,"y":258,"width":670,"height":12}},{"id":"ad8e8d91-facd-414c-bfbc-b7d417a476f7","block_type":"box","text":"plans to net-zero aligned activities or suppliers, and strategies to mitigate material transition","page_number":503,"box":{"x":184,"y":273,"width":684,"height":12}},{"id":"8177db88-7cee-4059-b9ac-71c9cf2fced7","block_type":"box","text":"risks.","page_number":503,"box":{"x":184,"y":289,"width":43,"height":9}},{"id":"e07243dc-3bcd-458f-a0ce-ce88300b6cc0","block_type":"box","text":"(4) where relevant, disclosures that describe the company’s exposure to climate-related physical","page_number":503,"box":{"x":150,"y":312,"width":729,"height":12}},{"id":"bc01a18d-b30b-40ea-846a-af968c1a2b5b","block_type":"box","text":"risks – such as acute risks from extreme weather events or chronic risks from long-term shifts","page_number":503,"box":{"x":184,"y":327,"width":699,"height":12}},{"id":"a0edf167-e6b5-4665-82a6-4a5c058c82be","block_type":"box","text":"in climate patterns – and how these risks could reasonably be expected to affect the","page_number":503,"box":{"x":184,"y":343,"width":629,"height":12}},{"id":"8a912388-2135-4666-bc8f-f8f14bb66bd9","block_type":"box","text":"company’s operations, assets, or supply chains.","page_number":503,"box":{"x":184,"y":358,"width":361,"height":12}},{"id":"9ebd776e-7beb-49aa-9ec7-d1f4a15325a8","block_type":"box","text":"Transition plans","page_number":503,"box":{"x":150,"y":389,"width":134,"height":12}},{"id":"a8cb674f-de75-4e4d-9a7b-fbec298b1806","block_type":"box","text":"Some companies have published transition plans outlining how they intend to implement their","page_number":503,"box":{"x":150,"y":420,"width":698,"height":12}},{"id":"388cbe2d-071b-4d5f-a9a8-047fe61e942b","block_type":"box","text":"low-carbon transition strategies. As defined by the ISSB, a transition plan “lays out the entity’s","page_number":503,"box":{"x":150,"y":436,"width":701,"height":12}},{"id":"34b0db5d-b469-4a53-a570-0d23ab5b3630","block_type":"box","text":"targets, actions or resources for its transition towards a lower-carbon economy, including actions","page_number":503,"box":{"x":150,"y":451,"width":722,"height":12}},{"id":"8e105d01-1051-4f90-ba8d-a91eeadf2ae5","block_type":"box","text":"such as reducing its greenhouse gas emissions” (see Appendix 1).","page_number":503,"box":{"x":150,"y":467,"width":494,"height":12}},{"id":"2317bd15-e1aa-40a4-b273-1a5be6fd7c52","block_type":"box","text":"19","page_number":503,"box":{"x":646,"y":467,"width":11,"height":6}},{"id":"e74e0eb3-358e-4688-8ef4-9af057c52a68","block_type":"box","text":"Work is also underway in a number of jurisdictions on establishing a common approach in a","page_number":503,"box":{"x":150,"y":490,"width":685,"height":12}},{"id":"29770777-eb88-46be-af1e-101d27a72363","block_type":"box","text":"market to corporate transition plans.","page_number":503,"box":{"x":150,"y":506,"width":267,"height":12}},{"id":"61b5449e-2a70-47d5-a93d-c194ac8533b8","block_type":"box","text":"20","page_number":503,"box":{"x":418,"y":506,"width":12,"height":6}},{"id":"8ac84784-b036-4282-8e04-b45f202a375c","block_type":"box","text":"Recent guidance from the ISSB on disclosures about","page_number":503,"box":{"x":430,"y":506,"width":404,"height":12}},{"id":"57a5fae8-c156-441d-8220-01554bae3a35","block_type":"box","text":"transition plans highlights the convergence of reporting approaches.","page_number":503,"box":{"x":150,"y":521,"width":509,"height":12}},{"id":"1c680030-9863-4531-a76c-234593cb6ffc","block_type":"box","text":"While the preparation of a transition plan, or lack thereof, is not, in itself, a voting issue, these","page_number":503,"box":{"x":150,"y":544,"width":697,"height":12}},{"id":"7a16cb40-88a7-4888-acd2-02fb5b69af28","block_type":"box","text":"disclosures typically provide valuable insights that inform the dedicated team’s approach to","page_number":503,"box":{"x":150,"y":560,"width":679,"height":12}},{"id":"e79f56af-0e80-4e34-9a0a-3545ec4b4703","block_type":"box","text":"engaging and voting on matters related to climate and transition risks on behalf of in-scope funds","page_number":503,"box":{"x":150,"y":575,"width":725,"height":12}},{"id":"3e1f6c89-0106-4699-88d7-c0e251beb84f","block_type":"box","text":"and accounts.","page_number":503,"box":{"x":150,"y":591,"width":109,"height":9}},{"id":"2c80a53e-a88e-4f4b-9c18-6a63b0885fb8","block_type":"box","text":"18","page_number":503,"box":{"x":144,"y":725,"width":8,"height":5}},{"id":"c74d49c2-0156-43e0-9956-d1275762791d","block_type":"box","text":"The dedicated team does not believe the purpose of scope 3 disclosure requirements should be to push publicly traded","page_number":503,"box":{"x":170,"y":725,"width":707,"height":9}},{"id":"610ec82d-e417-4de9-a961-29378ac5b9e2","block_type":"box","text":"companies into the role of enforcing emission reduction targets outside of their control. Given methodological","page_number":503,"box":{"x":170,"y":737,"width":645,"height":10}},{"id":"dfaee238-98b0-44ba-99a5-e3610e2ac4f6","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":503,"box":{"x":170,"y":750,"width":686,"height":10}},{"id":"173e069c-d98b-4c55-9192-26ffab89056b","block_type":"box","text":"useful when companies focus their disclosures on those of the fifteen scope 3 GHG Protocol categories that are","page_number":503,"box":{"x":170,"y":763,"width":663,"height":10}},{"id":"ae7c6b38-b518-487c-af35-bcdc3843f402","block_type":"box","text":"material to their business models.","page_number":503,"box":{"x":170,"y":776,"width":199,"height":8}},{"id":"634feba3-920b-44a9-8be4-a7290f0d3b96","block_type":"box","text":"19","page_number":503,"box":{"x":144,"y":789,"width":8,"height":5}},{"id":"88097bbc-4816-4692-87f4-407f37c6d777","block_type":"box","text":"International Financial Reporting Standards, “IFRS S2: Climate-related Disclosures,” June 2023, accessed in December","page_number":503,"box":{"x":171,"y":789,"width":712,"height":10}},{"id":"a842a38c-b31f-40c1-94b6-1fcac2b734e6","block_type":"box","text":"2025.","page_number":503,"box":{"x":170,"y":802,"width":32,"height":8}},{"id":"55834c55-0dbf-4c82-b80e-4520d7d07aa8","block_type":"box","text":"20","page_number":503,"box":{"x":143,"y":815,"width":9,"height":5}},{"id":"4a857352-1605-46e3-9b63-576f58d87d60","block_type":"box","text":"More companies are developing such plans, and public policymakers in certain markets are signaling their intentions to","page_number":503,"box":{"x":171,"y":815,"width":705,"height":10}},{"id":"523fa093-9bb2-4ac5-8cd6-b706fe226aef","block_type":"box","text":"require them or already have requirements in place, such as Australia, Brazil, and the European Union (please see the","page_number":503,"box":{"x":170,"y":828,"width":704,"height":10}},{"id":"5b72bf6c-5c1b-43f4-89f3-a845cc320337","block_type":"box","text":"International Transition Plan Network for information). BlackRock views transition plans as a method for a company to","page_number":503,"box":{"x":171,"y":841,"width":697,"height":9}},{"id":"6e05d6bd-3a0f-4b8f-87f9-8c7996cac5bd","block_type":"box","text":"both internally assess and externally communicate its long-term strategy, ambition, objectives, and actions to create","page_number":503,"box":{"x":170,"y":854,"width":687,"height":9}},{"id":"7f06c89c-3454-4b2b-82fb-c419a6fd7b29","block_type":"box","text":"financial value through the global transition towards a low-carbon economy. Across the landscape there remains","page_number":503,"box":{"x":170,"y":867,"width":666,"height":9}},{"id":"b2c29a0e-0369-480b-a877-fbf2852e63c2","block_type":"box","text":"divergence on the objectives of such plans and the details they should contain. Website accessed in December 2025.","page_number":503,"box":{"x":170,"y":880,"width":697,"height":9}},{"id":"8d7e4b56-4bf6-4483-8b8c-955ab363a88e","block_type":"box","text":"BlackRock Investment Stewardship","page_number":503,"box":{"x":117,"y":909,"width":277,"height":12}},{"id":"63ba0a93-11e4-4f1f-99c2-08f345413652","block_type":"box","text":"Climate and Decarbonization St","page_number":503,"box":{"x":504,"y":909,"width":213,"height":9}},{"id":"6752d188-7b38-4286-812c-a3ff0a4b0d98","block_type":"box","text":"ewardship Guidelines |","page_number":503,"box":{"x":717,"y":909,"width":152,"height":12}},{"id":"c89de6e9-cace-4038-8394-6518484384ce","block_type":"box","text":"7","page_number":503,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"be3c0796-da95-4222-a771-38929117277c","block_type":"box","text":"NM1026U-6004382-503/605","page_number":503,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9c0dff25-6fe6-4305-8d85-31ed6eef615c","block_type":"box","text":"Boards and directors","page_number":504,"box":{"x":116,"y":87,"width":174,"height":10}},{"id":"210c48f2-635b-4f56-a18e-07d7d5e41b91","block_type":"box","text":"An effective and well-functioning board that has appropriate governance structures to facilitate","page_number":504,"box":{"x":116,"y":110,"width":704,"height":12}},{"id":"7206e31d-b47f-4877-9abd-a2f60ff8e321","block_type":"box","text":"oversight of a company’s management and strategic initiatives is critical to the company’s ability to","page_number":504,"box":{"x":116,"y":126,"width":736,"height":12}},{"id":"1f6b1016-0276-44b2-a4b2-bca26d325902","block_type":"box","text":"deliver on its low-carbon transition strategy. In assessing the role and effectiveness of the board in this","page_number":504,"box":{"x":116,"y":141,"width":766,"height":12}},{"id":"c1749234-ffce-4472-8610-5a2efa607c79","block_type":"box","text":"regard, the dedicated team seeks to understand whether:","page_number":504,"box":{"x":117,"y":157,"width":430,"height":12}},{"id":"77b06125-d80e-4962-b857-55974728ae50","block_type":"box","text":"• The board has clear oversight responsibilities for climate and low-carbon transition-related","page_number":504,"box":{"x":150,"y":188,"width":707,"height":12}},{"id":"2a34b6e7-3ecf-4d4c-96f6-f18b3fa6ca3e","block_type":"box","text":"risks and opportunities in the company’s business model. The Guidelines consider the whole","page_number":504,"box":{"x":184,"y":203,"width":692,"height":12}},{"id":"7637408e-44ca-4b3e-b41d-0e8c0ff4f4a9","block_type":"box","text":"board to have responsibility for oversight of the company’s long-term strategy, including those","page_number":504,"box":{"x":184,"y":219,"width":700,"height":12}},{"id":"cbdc956a-f0ed-4e58-9264-7ca4c0c1fa7c","block_type":"box","text":"aspects related to the transition to a low-carbon economy.","page_number":504,"box":{"x":184,"y":234,"width":435,"height":12}},{"id":"30c3e11c-10e7-4afe-af14-3b7c12c0ce13","block_type":"box","text":"• Management has established a robust low-carbon transition framework and long-term","page_number":504,"box":{"x":150,"y":258,"width":675,"height":12}},{"id":"d417cfed-c6e3-41db-bff5-cc406d33ffcc","block_type":"box","text":"strategy, with clear accountability for delivery by senior executives.","page_number":504,"box":{"x":184,"y":273,"width":500,"height":12}},{"id":"44f9cbed-8118-4683-9811-8b6c3b326f9e","block_type":"box","text":"• The capital management strategy explains how the company allocates investments to","page_number":504,"box":{"x":150,"y":296,"width":675,"height":12}},{"id":"bec251b5-58fa-4a6b-95aa-dadf93a2b702","block_type":"box","text":"(traditional and next generation) business lines and innovation, and returns cash to","page_number":504,"box":{"x":184,"y":312,"width":619,"height":12}},{"id":"46adc4a9-ccd7-4bd5-9ed3-18fa3598a18b","block_type":"box","text":"shareholders, consistent with the company’s stated low-carbon transition strategy.","page_number":504,"box":{"x":184,"y":327,"width":614,"height":12}},{"id":"04791c43-647c-4d95-8715-090926f84c66","block_type":"box","text":"• The climate and low-carbon transition risks most likely to significantly impact the business are","page_number":504,"box":{"x":150,"y":351,"width":733,"height":12}},{"id":"e36eeb05-7996-4e3c-8da8-44cf75e93652","block_type":"box","text":"integrated into the company’s enterprise risk management processes and reporting.","page_number":504,"box":{"x":184,"y":366,"width":627,"height":12}},{"id":"f005734a-8622-4724-ba3b-0a9f6ac42686","block_type":"box","text":"• The company has set scope 1 and 2 GHG emissions reduction targets, science-based and","page_number":504,"box":{"x":150,"y":389,"width":712,"height":12}},{"id":"efb266ee-b09e-48de-99f3-b14d4766682d","block_type":"box","text":"independently verified where possible, against a baseline, that are consistent with the","page_number":504,"box":{"x":184,"y":405,"width":639,"height":12}},{"id":"c654fdcb-bf28-4864-98ce-9ae04fa7d8f3","block_type":"box","text":"ambition to limit average global temperature rise to no more than 1.5°C above pre-industrial","page_number":504,"box":{"x":184,"y":420,"width":685,"height":12}},{"id":"e139b7bd-f363-4288-a043-459b233b2641","block_type":"box","text":"levels.","page_number":504,"box":{"x":184,"y":436,"width":51,"height":9}},{"id":"b5abc9a1-3634-4dca-913e-3c55a86fbf79","block_type":"box","text":"• There is a clear link between the company’s scope 1 and 2 GHG emissions reduction targets","page_number":504,"box":{"x":150,"y":459,"width":728,"height":12}},{"id":"0d91a1fe-126a-49d8-86c2-33880876beb9","block_type":"box","text":"over time and its long-term low-carbon transition strategy.","page_number":504,"box":{"x":184,"y":475,"width":432,"height":12}},{"id":"d44de3e8-78e5-42fa-b710-90d635d7eece","block_type":"box","text":"• The company is monitoring its most significant scope 3 emissions and disclosing these where","page_number":504,"box":{"x":150,"y":498,"width":733,"height":12}},{"id":"0a6dab37-8ea8-4cf4-844f-ae191b48ee5e","block_type":"box","text":"it is confident in the data. Given forthcoming regulatory requirements in certain jurisdictions,","page_number":504,"box":{"x":184,"y":513,"width":684,"height":12}},{"id":"5f3903fb-402b-40e7-b13c-815ecbad2fec","block_type":"box","text":"some companies are voluntarily disclosing scope 3 emissions reductions targets and plans,","page_number":504,"box":{"x":184,"y":529,"width":683,"height":12}},{"id":"3218f3da-5d88-4e62-b850-acb2968d5759","block_type":"box","text":"setting out how they are working on decarbonization with the different constituents in their","page_number":504,"box":{"x":184,"y":544,"width":670,"height":12}},{"id":"e126a53f-83b4-480d-8dc7-f7c3db62a6d4","block_type":"box","text":"value chain.","page_number":504,"box":{"x":183,"y":560,"width":94,"height":9}},{"id":"6acacbb8-6953-4ba5-8d97-45716926ef97","block_type":"box","text":"21","page_number":504,"box":{"x":278,"y":560,"width":10,"height":6}},{"id":"0020e7c0-e58e-40db-8149-f60dee88f8ff","block_type":"box","text":"• The company’s governance and oversight processes for managing material risks associated","page_number":504,"box":{"x":150,"y":583,"width":723,"height":12}},{"id":"e112993a-12cc-44a3-8db9-75e6d6585495","block_type":"box","text":"with corporate political activities including applicable policies and procedures where","page_number":504,"box":{"x":183,"y":599,"width":624,"height":12}},{"id":"6728e7fa-badc-427c-a178-200460977d3f","block_type":"box","text":"relevant.","page_number":504,"box":{"x":184,"y":614,"width":62,"height":10}},{"id":"63d8a8b9-1945-4a03-a36d-d2fca6eb6d05","block_type":"box","text":"22","page_number":504,"box":{"x":248,"y":614,"width":11,"height":6}},{"id":"6a326880-85cb-4344-92ab-598d5809aaa7","block_type":"box","text":"The dedicated team looks for public policy engagement to be consistent with a","page_number":504,"box":{"x":260,"y":614,"width":592,"height":12}},{"id":"d4ef88da-a378-4a39-be4e-14df01b17a35","block_type":"box","text":"company’s stated strategic policy objectives, including those related to the low-carbon","page_number":504,"box":{"x":184,"y":630,"width":642,"height":12}},{"id":"0cd04a47-a0db-4c1d-8ed1-ec9e26c62811","block_type":"box","text":"transition.","page_number":504,"box":{"x":183,"y":645,"width":78,"height":10}},{"id":"6fdfc7a1-5ccd-4ae2-bb18-e8889b7418c9","block_type":"box","text":"21","page_number":504,"box":{"x":143,"y":789,"width":8,"height":5}},{"id":"d6617445-c85b-4d89-b2c8-92cc24f49c5c","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":504,"box":{"x":171,"y":789,"width":685,"height":10}},{"id":"9512da04-5599-4e16-83d2-9c8dd6d9f7c8","block_type":"box","text":"paper “Scope for improvement: Solving the Scope 3 conundrum.” Their research indicates that there are 2-3 material","page_number":504,"box":{"x":170,"y":802,"width":692,"height":10}},{"id":"46d01d19-bbe4-4fcd-8c68-e70674e7e656","block_type":"box","text":"scope 3 GHG emissions categories by sector. The research uses a definition of materiality from the GHG Protocol,","page_number":504,"box":{"x":170,"y":815,"width":679,"height":10}},{"id":"4149e0ab-07cd-4a02-aafc-2bf59f293d5a","block_type":"box","text":"which “encourages companies to maintain a representative inventory of the “most significant GHG emissions, [that]","page_number":504,"box":{"x":170,"y":828,"width":682,"height":10}},{"id":"60847fb1-1817-42d8-98a9-6b63a34842fe","block_type":"box","text":"offer the most significant GHG reduction opportunities and are most relevant to the company’s business goals.” Website","page_number":504,"box":{"x":170,"y":841,"width":712,"height":9}},{"id":"59714852-64c5-444a-a3bf-379e466b0d62","block_type":"box","text":"accessed in December 2025.","page_number":504,"box":{"x":170,"y":854,"width":173,"height":7}},{"id":"dcd0b5b1-1373-4f90-a861-7d60f81c57de","block_type":"box","text":"22","page_number":504,"box":{"x":143,"y":867,"width":9,"height":5}},{"id":"10a58277-84f8-4dee-bc33-e94a413fcfb7","block_type":"box","text":"Corporate political activities may include lobbying as defined by local regulations, policy engagement (including trade","page_number":504,"box":{"x":170,"y":867,"width":694,"height":9}},{"id":"514d71d7-74b6-42ed-8a31-a350d930a956","block_type":"box","text":"association memberships), and corporate political contributions.","page_number":504,"box":{"x":170,"y":880,"width":378,"height":9}},{"id":"4566e500-b1f2-42fe-ab01-a2bd3cffbcd0","block_type":"box","text":"BlackRock Investment Stewardship","page_number":504,"box":{"x":117,"y":909,"width":277,"height":12}},{"id":"fd1f0a09-52d5-479f-ae03-41709eff647e","block_type":"box","text":"Climate and Decarbonization St","page_number":504,"box":{"x":504,"y":909,"width":213,"height":9}},{"id":"35b63d70-af92-40b5-8f36-6bc4198b80d0","block_type":"box","text":"ewardship Guidelines |","page_number":504,"box":{"x":717,"y":909,"width":152,"height":12}},{"id":"a744d9ac-3eae-4565-92d7-e72e2162d236","block_type":"box","text":"8","page_number":504,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"b6c33919-8b23-48d3-804d-dc8f294a6502","block_type":"box","text":"NM1026U-6004382-504/605","page_number":504,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"fbfe1f94-53f1-41a7-b338-eb4ad3fde22c","block_type":"box","text":"Voting against directors over concerns about climate risk","page_number":505,"box":{"x":118,"y":87,"width":424,"height":12}},{"id":"a0220e72-ca1a-40e1-9cc7-fb557751c866","block_type":"box","text":"In implementing these Guidelines, the dedicated team generally supports non-executive directors","page_number":505,"box":{"x":117,"y":118,"width":726,"height":12}},{"id":"4d4a63ce-e2f1-4fe0-a412-a3fc6a9ce25d","block_type":"box","text":"standing for election where, in its assessment based on company disclosures and engagement, a","page_number":505,"box":{"x":116,"y":134,"width":729,"height":12}},{"id":"4843df58-57c5-4ae5-be05-e688697be9af","block_type":"box","text":"company is executing on its commitment to align with the transition to a low-carbon economy, as","page_number":505,"box":{"x":116,"y":149,"width":722,"height":12}},{"id":"499a26f6-8a36-4ddf-ab7a-4a95b848fffa","block_type":"box","text":"defined above. Where the dedicated team determines this is not the case, it may vote against the","page_number":505,"box":{"x":116,"y":165,"width":727,"height":12}},{"id":"edcb5d3d-cf37-4a38-931c-71105c9c1f46","block_type":"box","text":"election of one or more directors who the team identifies as having the most responsibility for the issue.","page_number":505,"box":{"x":116,"y":180,"width":772,"height":12}},{"id":"a7e2eba3-b8a6-49cb-b380-88767076ba8e","block_type":"box","text":"The directors most likely to be in focus are the chair of the board committee with low-carbon transition,","page_number":505,"box":{"x":116,"y":196,"width":765,"height":12}},{"id":"b85ffa25-88a1-44c1-8f6e-58b143fcdbf7","block_type":"box","text":"climate or sustainability risk oversight responsibilities, other members of the relevant committee, the","page_number":505,"box":{"x":116,"y":211,"width":746,"height":12}},{"id":"97928634-cc6c-4ce3-b596-0d9da64d2cb9","block_type":"box","text":"lead independent director or the non-executive chair of the board. In certain markets, the team may","page_number":505,"box":{"x":117,"y":227,"width":741,"height":12}},{"id":"353d4b8a-f64c-4ea2-b623-fc71cf3f5ad0","block_type":"box","text":"withhold support for the discharge of the supervisory board or equivalent and/or board reports.","page_number":505,"box":{"x":116,"y":242,"width":699,"height":12}},{"id":"37705d3f-cf0a-46a1-956f-12c4bca4528c","block_type":"box","text":"23","page_number":505,"box":{"x":817,"y":242,"width":11,"height":6}},{"id":"e7990377-3903-4fde-9295-19768e180a23","block_type":"box","text":"Where the dedicated team has not supported director elections over climate concerns in a prior year,","page_number":505,"box":{"x":116,"y":273,"width":754,"height":12}},{"id":"398e3fde-162a-4a77-9382-3824281cb6b2","block_type":"box","text":"and the company has not subsequently made progress towards aligning with the transition to a","page_number":505,"box":{"x":116,"y":289,"width":709,"height":12}},{"id":"acdfc6be-796f-4adc-9163-3a8b623a90ad","block_type":"box","text":"low-carbon economy, the team may escalate by not supporting the re-election of additional responsible","page_number":505,"box":{"x":117,"y":304,"width":769,"height":12}},{"id":"ffe61ff2-ff5c-4b54-b0d1-87b2d7cebe40","block_type":"box","text":"directors.","page_number":505,"box":{"x":116,"y":320,"width":67,"height":9}},{"id":"ee16474d-4fd1-46dd-98a1-370c179f28eb","block_type":"box","text":"24","page_number":505,"box":{"x":185,"y":320,"width":12,"height":6}},{"id":"aff530e3-8950-4480-81bd-aa3db5771fb4","block_type":"box","text":"Management proposals to approve a climate strategy or progress report","page_number":505,"box":{"x":116,"y":351,"width":582,"height":12}},{"id":"7fb02fb9-1187-4c78-a3c8-8db9fd76145d","block_type":"box","text":"In certain markets, company management may submit proposals – commonly referred to as “Say on","page_number":505,"box":{"x":117,"y":382,"width":750,"height":12}},{"id":"6e20c7b7-440e-4256-b141-6b272eefc270","block_type":"box","text":"Climate” – seeking shareholder approval of their climate action plans or progress reports. The","page_number":505,"box":{"x":117,"y":397,"width":700,"height":12}},{"id":"369428b3-00f6-4e82-b86e-220382952a06","block_type":"box","text":"Guidelines consider these proposals as a valuable governance mechanism that can enhance","page_number":505,"box":{"x":117,"y":413,"width":696,"height":12}},{"id":"80831b36-c232-4e19-b2be-d29f6d5d0a24","block_type":"box","text":"transparency, accountability, and investors’ understanding of a company’s climate strategy. The","page_number":505,"box":{"x":116,"y":428,"width":716,"height":12}},{"id":"ef24978e-0975-4f7f-a635-bab5b203b026","block_type":"box","text":"dedicated team generally supports management’s climate strategy proposal if, in the team’s","page_number":505,"box":{"x":116,"y":444,"width":687,"height":12}},{"id":"57080432-037f-4946-ae79-6980de648794","block_type":"box","text":"assessment based on these Guidelines, the strategy is aligned with the low-carbon transition. Similarly,","page_number":505,"box":{"x":116,"y":459,"width":772,"height":12}},{"id":"4cd76d50-1a27-4677-a7a1-007bc4af75f1","block_type":"box","text":"the dedicated team generally supports management’s proposal on a progress report if the company","page_number":505,"box":{"x":116,"y":475,"width":745,"height":12}},{"id":"68abcbab-982e-4bd9-8cbe-d5938179f888","block_type":"box","text":"has clearly explained its progress against, and any deviations from or changes to, its stated low-carbon","page_number":505,"box":{"x":117,"y":490,"width":770,"height":12}},{"id":"8884954d-bc09-42c6-9b69-449faea48d5c","block_type":"box","text":"transition plan and targets.","page_number":505,"box":{"x":116,"y":506,"width":203,"height":12}},{"id":"babd170c-3bcc-4b01-9412-c83c3eb0692d","block_type":"box","text":"Shareholder proposals on climate and low-carbon transition matters","page_number":505,"box":{"x":117,"y":537,"width":551,"height":12}},{"id":"0324bd4b-7635-4023-beb0-8fa270ad8168","block_type":"box","text":"In most markets, shareholders can submit proposals to be voted on at a company’s shareholder","page_number":505,"box":{"x":117,"y":568,"width":717,"height":12}},{"id":"7ef4420a-ca46-494f-9fe7-ba3967fb9f6e","block_type":"box","text":"meeting, as long as certain requirements are met. Shareholder proposals span a wide range of topics","page_number":505,"box":{"x":117,"y":583,"width":758,"height":12}},{"id":"f360b79b-0014-43fc-8816-33f411870959","block_type":"box","text":"and have varying degrees of relevance for companies across sectors, locations, and business models.","page_number":505,"box":{"x":116,"y":599,"width":766,"height":12}},{"id":"76b7c104-4c66-4804-9eb3-a9060e6d554d","block_type":"box","text":"Each shareholder proposal is evaluated on a case-by-case basis, focusing on its merit while","page_number":505,"box":{"x":117,"y":630,"width":687,"height":12}},{"id":"7a3d8f65-85f2-40e7-961e-0f3f5b8c7da4","block_type":"box","text":"considering the company’s individual circumstances. When the dedicated team votes in support of a","page_number":505,"box":{"x":116,"y":645,"width":748,"height":12}},{"id":"6e93dc3c-e55e-4bdd-87ef-b52361a0b5ba","block_type":"box","text":"proposal, it is not necessarily endorsing every element of the proposal or the reasoning, objectives, or","page_number":505,"box":{"x":117,"y":661,"width":755,"height":12}},{"id":"64f40d1c-7814-45de-9e1a-863f14b6d218","block_type":"box","text":"supporting statement of the proponent.","page_number":505,"box":{"x":116,"y":676,"width":287,"height":12}},{"id":"7a4b73e9-41d3-4efd-a6ff-e33fd0a1deff","block_type":"box","text":"In addition to financial materiality, the Guidelines consider the proposal’s relevance to the company’s","page_number":505,"box":{"x":117,"y":707,"width":746,"height":12}},{"id":"78a5a0a5-3c5a-4393-a0a9-db4197d97f39","block_type":"box","text":"low-carbon transition strategy and targets. The dedicated team assesses the implications for, and the","page_number":505,"box":{"x":117,"y":723,"width":751,"height":12}},{"id":"a79b03ce-3cd8-48e2-b760-f3cf5c43bde8","block_type":"box","text":"23","page_number":505,"box":{"x":143,"y":815,"width":9,"height":5}},{"id":"619bd2f4-2d22-4ccb-ae1f-db7de1152057","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":505,"box":{"x":171,"y":815,"width":661,"height":10}},{"id":"309ecfd4-1bf7-4848-81be-485bbd7cd804","block_type":"box","text":"information on a company’s sustainability efforts, operational resilience, or financial condition, among others.","page_number":505,"box":{"x":170,"y":828,"width":643,"height":10}},{"id":"70e6a29a-62d8-45bc-bf58-d87e9c398e10","block_type":"box","text":"24","page_number":505,"box":{"x":143,"y":841,"width":9,"height":5}},{"id":"19baabc1-12a3-4cb4-aa92-93ed594dac77","block_type":"box","text":"While the dedicated team may escalate voting by not supporting additional management proposals, principally director","page_number":505,"box":{"x":170,"y":841,"width":703,"height":9}},{"id":"17dac859-5882-4774-8e89-206869656e83","block_type":"box","text":"elections, the team does not consider filing shareholder proposals, preannouncing voting intentions or using the media","page_number":505,"box":{"x":170,"y":854,"width":702,"height":9}},{"id":"6b51a314-a4e4-4eca-9fe2-b6460b5dadea","block_type":"box","text":"to amplify concerns as appropriate courses of action. The dedicated team will continue to take a constructive, long-term","page_number":505,"box":{"x":170,"y":867,"width":708,"height":9}},{"id":"b0262358-b63c-4746-9abc-a10aa7eff753","block_type":"box","text":"focused approach, to engagement and voting on behalf of clients under these Guidelines.","page_number":505,"box":{"x":170,"y":880,"width":530,"height":9}},{"id":"aaa8f6ca-bca6-4b26-86d1-344561fc09c6","block_type":"box","text":"BlackRock Investment Stewardship","page_number":505,"box":{"x":117,"y":909,"width":277,"height":12}},{"id":"dc773a95-90c8-471a-bd21-75a18a4efeec","block_type":"box","text":"Climate and Decarbonization St","page_number":505,"box":{"x":504,"y":909,"width":213,"height":9}},{"id":"8d11c78c-7ad5-4a35-810e-ef34c927df5b","block_type":"box","text":"ewardship Guidelines |","page_number":505,"box":{"x":717,"y":909,"width":152,"height":12}},{"id":"d773a4a9-b178-486f-b63d-0673a13d395b","block_type":"box","text":"9","page_number":505,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"41f6b9bd-7aea-48df-ac9b-7eef28d7ecf7","block_type":"box","text":"NM1026U-6004382-505/605","page_number":505,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"72d7bec8-5dd4-42ac-b54c-b58091f0234c","block_type":"box","text":"relevance to, the company’s stated low-carbon transition strategy and targets. Under the Guidelines,","page_number":506,"box":{"x":117,"y":87,"width":749,"height":12}},{"id":"0fa352c1-d45e-4bed-848d-4e8e86f1dcd9","block_type":"box","text":"the team may support shareholder proposals that, for example, ask a company to:","page_number":506,"box":{"x":116,"y":102,"width":615,"height":13}},{"id":"c4aeac9f-527c-44dd-a7a5-e6ce4e53b5bb","block_type":"box","text":"• Publish a business plan, and related disclosures, consistent with the ambition to limit average","page_number":506,"box":{"x":150,"y":135,"width":732,"height":11}},{"id":"c499bb83-3473-4647-8ae6-ae44e0d476d7","block_type":"box","text":"global temperature rise to no more than 1.5°C above pre-industrial levels","page_number":506,"box":{"x":184,"y":150,"width":546,"height":12}},{"id":"252f90c6-c2cb-441c-8080-edacc7c38541","block_type":"box","text":"• Align scope 1 and 2 GHG emissions reduction targets to, and/or discuss how their targets","page_number":506,"box":{"x":150,"y":173,"width":704,"height":13}},{"id":"ccfd3e73-f289-4c1c-990d-f7c0bcbd1f61","block_type":"box","text":"align with, a long-term goal of the company achieving net zero GHG emissions by 2050","page_number":506,"box":{"x":184,"y":189,"width":653,"height":12}},{"id":"e8e5d6b9-b764-48e6-ab4d-b22973eee166","block_type":"box","text":"• Disclose the categories of scope 3 GHG emissions most significant to a company’s business","page_number":506,"box":{"x":150,"y":213,"width":726,"height":12}},{"id":"e19f6e35-3a02-48b1-ba50-97f0fe669f28","block_type":"box","text":"model","page_number":506,"box":{"x":184,"y":228,"width":50,"height":10}},{"id":"f5a3e0b1-93f4-468e-be48-52ca340704a1","block_type":"box","text":"• Improve voluntary disclosures on the alignment of a company’s climate-related corporate","page_number":506,"box":{"x":150,"y":252,"width":698,"height":12}},{"id":"09b357aa-9bcc-4a59-a430-037dde9dfa7d","block_type":"box","text":"political activities with its strategic policy positions, where existing disclosure is insufficient","page_number":506,"box":{"x":184,"y":267,"width":666,"height":12}},{"id":"ef2579d0-1e65-4308-aadf-f5e62157e9d5","block_type":"box","text":"25","page_number":506,"box":{"x":850,"y":267,"width":11,"height":7}},{"id":"0b959d5a-572c-4ae7-b576-ce2c30e2bf46","block_type":"box","text":"The dedicated team does not support shareholder proposals that seek to constrain board or","page_number":506,"box":{"x":116,"y":299,"width":687,"height":12}},{"id":"bbab7cc9-723a-4fd8-b94a-0726c3ffe5d2","block_type":"box","text":"management decision-making or direct specific business or strategic decisions.","page_number":506,"box":{"x":117,"y":315,"width":593,"height":12}},{"id":"e3405fe3-487c-4e04-bc7c-a525b27cdb34","block_type":"box","text":"Related matters","page_number":506,"box":{"x":438,"y":355,"width":129,"height":9}},{"id":"023613ef-2c82-4896-9ecb-f34634bd00d3","block_type":"box","text":"There are other business items not covered above that may be put to a shareholder vote that could","page_number":506,"box":{"x":116,"y":387,"width":741,"height":12}},{"id":"08d9d956-f211-4018-8d76-d48f14d8da61","block_type":"box","text":"address matters relevant to the transition to a low-carbon economy. Under these Guidelines, the","page_number":506,"box":{"x":116,"y":402,"width":720,"height":12}},{"id":"00ca13de-d093-4094-9b37-47f3470355d5","block_type":"box","text":"dedicated team engages, where appropriate, to enhance its understanding of a company’s approach.","page_number":506,"box":{"x":116,"y":417,"width":757,"height":13}},{"id":"82f717f3-242e-40d9-8b35-e25dd261c90e","block_type":"box","text":"Generally, voting on these matters would be covered by BIS’ Benchmark Policies.","page_number":506,"box":{"x":117,"y":433,"width":612,"height":12}},{"id":"4b393fe5-437a-4aae-86f2-0baa396715dc","block_type":"box","text":"Executive compensation","page_number":506,"box":{"x":116,"y":465,"width":202,"height":12}},{"id":"b211b843-ad43-4798-8488-ab3db77d159c","block_type":"box","text":"The dedicated team looks to company boards to put in place a compensation structure that","page_number":506,"box":{"x":116,"y":497,"width":681,"height":12}},{"id":"4173fa1d-428e-4af7-ae76-57a873ccb5fc","block_type":"box","text":"incentivizes and rewards executives appropriately. Some companies, in light of their long-term","page_number":506,"box":{"x":117,"y":512,"width":703,"height":12}},{"id":"270b2c1a-fd03-47b4-8b4b-6778072cd86b","block_type":"box","text":"strategy, may decide to include relevant GHG emissions reduction targets or low-carbon transition","page_number":506,"box":{"x":116,"y":528,"width":734,"height":12}},{"id":"aa273673-e230-4b0a-8491-5cd896285fcd","block_type":"box","text":"related metrics in their incentive plans. In such cases, the dedicated team would engage to understand","page_number":506,"box":{"x":117,"y":543,"width":767,"height":12}},{"id":"50c2e57b-475d-46ff-9269-6d62b83d8ab3","block_type":"box","text":"the alignment between those metrics and the company’s stated climate strategy. Clear disclosure also","page_number":506,"box":{"x":116,"y":559,"width":763,"height":12}},{"id":"9d9a20c5-beda-4591-87a2-ca1c0385119e","block_type":"box","text":"helps investors assess whether pay structures are consistent with long-term climate strategy and risk","page_number":506,"box":{"x":117,"y":574,"width":754,"height":12}},{"id":"feef4048-9e36-407e-b943-8b79ea95d015","block_type":"box","text":"management.","page_number":506,"box":{"x":117,"y":590,"width":106,"height":12}},{"id":"1a1b3036-2abe-4eb4-b231-9d17dfa96d41","block_type":"box","text":"Auditors and audit-related issues","page_number":506,"box":{"x":116,"y":622,"width":271,"height":9}},{"id":"b6ccccf6-b163-4b7b-8263-8b6e65d3e9cc","block_type":"box","text":"For companies with material climate or transition risks or opportunities in their business models, the","page_number":506,"box":{"x":117,"y":654,"width":742,"height":11}},{"id":"1bf33c0f-da1e-4f45-8e69-36117d0f2d4e","block_type":"box","text":"dedicated team is interested in understanding whether the company considers and, if relevant,","page_number":506,"box":{"x":116,"y":669,"width":700,"height":12}},{"id":"934136e6-c4f9-4bbc-a651-5ae2818d4073","block_type":"box","text":"quantifies, and accounts for material climate-related risks in its financial statements, including if the","page_number":506,"box":{"x":116,"y":684,"width":734,"height":13}},{"id":"b635bb75-1d91-40ad-a909-0e3d1c239888","block_type":"box","text":"company explains such risks within the context of its audit report. The team notes that assurance of","page_number":506,"box":{"x":116,"y":700,"width":740,"height":12}},{"id":"f075352e-8cc9-4348-ad9e-2b82ff110fc3","block_type":"box","text":"corporate disclosures related to climate risk and the transition to a low-carbon economy is still nascent.","page_number":506,"box":{"x":116,"y":716,"width":763,"height":12}},{"id":"9c2c4e1b-051b-4180-bd48-1d08a1616f7d","block_type":"box","text":"Mergers, acquisitions, asset sales, and other special situations","page_number":506,"box":{"x":116,"y":747,"width":504,"height":12}},{"id":"fbf91c3d-d0dd-43b1-96d5-ffd62e010744","block_type":"box","text":"Special situations will be considered on their financial merits, but the dedicated team may engage on","page_number":506,"box":{"x":116,"y":779,"width":747,"height":12}},{"id":"de1760f8-204e-41ca-8c71-090f5275cc18","block_type":"box","text":"climate-related factors under these Guidelines where a transaction may significantly alter a company’s","page_number":506,"box":{"x":116,"y":795,"width":759,"height":12}},{"id":"0e564ff9-11c3-45e6-9388-379130c97635","block_type":"box","text":"climate strategy or a shareholder activist has proposed governance, strategic or operational changes","page_number":506,"box":{"x":116,"y":810,"width":749,"height":12}},{"id":"9a0cef3f-c1ce-4ec6-acc7-00ed26ac5772","block_type":"box","text":"that may impact its climate strategy. The dedicated team does not promote changes in corporate","page_number":506,"box":{"x":116,"y":826,"width":723,"height":12}},{"id":"be5eb84b-dc05-44d1-80ab-03d698eb7bd3","block_type":"box","text":"control or engage in shareholder activism.","page_number":506,"box":{"x":116,"y":841,"width":317,"height":12}},{"id":"c652d71e-7b64-45fb-b62d-bc6b24d45e20","block_type":"box","text":"25","page_number":506,"box":{"x":143,"y":866,"width":9,"height":5}},{"id":"6f580efc-854b-4f8a-963c-eb8c4b64c817","block_type":"box","text":"Corporate political activities may include lobbying as defined by local regulations, policy engagement (including trade","page_number":506,"box":{"x":170,"y":866,"width":694,"height":10}},{"id":"4b443f1d-5a24-40d7-a81e-cb48ea1dbc33","block_type":"box","text":"association memberships), and corporate political contributions.","page_number":506,"box":{"x":170,"y":879,"width":378,"height":10}},{"id":"619c3830-093b-40fb-af85-b771d3816b95","block_type":"box","text":"BlackRock Investment Stewardship","page_number":506,"box":{"x":117,"y":909,"width":277,"height":12}},{"id":"74ad3152-091e-4271-89bb-ee8b6ec7006c","block_type":"box","text":"Climate and Decarbonization St","page_number":506,"box":{"x":496,"y":909,"width":212,"height":9}},{"id":"288f4ce0-de7a-4b56-93e3-a82fa67ead77","block_type":"box","text":"ewardship Guidelines |","page_number":506,"box":{"x":709,"y":909,"width":152,"height":12}},{"id":"6776a894-22b2-41ac-b5de-c7d1f2549e88","block_type":"box","text":"10","page_number":506,"box":{"x":867,"y":909,"width":16,"height":9}},{"id":"d0184f79-249f-40b2-8092-ae0906715a8c","block_type":"box","text":"NM1026U-6004382-506/605","page_number":506,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b11c38cb-51e4-48cb-b1ea-82b4762930eb","block_type":"box","text":"Other business relevant sustainability-related risks and opportunities","page_number":507,"box":{"x":117,"y":87,"width":559,"height":12}},{"id":"780ebd9e-6b10-4335-a63f-39110b9cfce7","block_type":"box","text":"Climate risk and the transition to a low-carbon economy are interconnected with a number of other","page_number":507,"box":{"x":117,"y":118,"width":734,"height":12}},{"id":"28f42de5-b793-4508-b2e2-cbfc2f19c512","block_type":"box","text":"material sustainability-related risks and opportunities that may be relevant to a company’s business","page_number":507,"box":{"x":117,"y":134,"width":741,"height":12}},{"id":"b80414bc-bdd2-4249-8e00-d2e4cf1a2637","block_type":"box","text":"model and long-term financial performance. These include a company’s impacts or dependencies on","page_number":507,"box":{"x":117,"y":149,"width":752,"height":12}},{"id":"ed71e4ed-c75e-4d5a-b3bc-43b1b1aaae98","block_type":"box","text":"natural capital and key stakeholders.","page_number":507,"box":{"x":117,"y":165,"width":270,"height":12}},{"id":"21b79393-6abb-4e28-bc43-9eed1fa4f803","block_type":"box","text":"26","page_number":507,"box":{"x":389,"y":165,"width":12,"height":6}},{"id":"b75a2dda-4d7f-4afd-9c5e-36c9d3feb319","block_type":"box","text":"In the context of these Guidelines, the dedicated team may","page_number":507,"box":{"x":401,"y":165,"width":448,"height":12}},{"id":"1202a113-b111-47b1-a177-2eb7cce4076f","block_type":"box","text":"engage companies to better understand how they are managing the impact on people (e.g.,","page_number":507,"box":{"x":116,"y":180,"width":686,"height":12}},{"id":"1963b455-8b3e-4bf6-9b5d-4970bea8c66e","block_type":"box","text":"employees, suppliers, customers and communities) of any strategic or operational changes they are","page_number":507,"box":{"x":116,"y":196,"width":747,"height":12}},{"id":"32fcc668-e40e-4f43-812c-2e9db15a0a8e","block_type":"box","text":"making in relation to their transition to a low-carbon economy. Similarly, the team may engage","page_number":507,"box":{"x":117,"y":211,"width":702,"height":12}},{"id":"c2ef1a5c-8e62-407d-ba5a-2332d028923f","block_type":"box","text":"companies that face risks and opportunities related to land use and deforestation, access to fresh","page_number":507,"box":{"x":116,"y":227,"width":729,"height":11}},{"id":"032ff8cd-f86a-4f68-87c2-15e7af713670","block_type":"box","text":"water, or the ability to secure scarce resources critical to the transition to a low-carbon economy.","page_number":507,"box":{"x":116,"y":242,"width":722,"height":12}},{"id":"d71a98e5-3e3f-4672-9622-810a0cc04fd2","block_type":"box","text":"26","page_number":507,"box":{"x":143,"y":867,"width":9,"height":5}},{"id":"c1a9e79d-3226-45e2-ac58-5b6b5b394cd2","block_type":"box","text":"Engagement with companies on these issues is informed by BIS’ commentaries on natural capital, human capital","page_number":507,"box":{"x":171,"y":867,"width":669,"height":9}},{"id":"6827b333-ce73-49e1-a058-83432c9bf7fe","block_type":"box","text":"management, and corporate human rights risks, December 2025.","page_number":507,"box":{"x":170,"y":880,"width":387,"height":9}},{"id":"ff98744f-0cd1-4790-b678-b90d53c7b09a","block_type":"box","text":"BlackRock Investment Stewardship","page_number":507,"box":{"x":117,"y":909,"width":277,"height":12}},{"id":"ca3b9c13-ce63-4368-9eeb-f8a4069d7333","block_type":"box","text":"Climate and Decarbonization St","page_number":507,"box":{"x":496,"y":909,"width":212,"height":9}},{"id":"af1ecec3-f3f2-496c-8d92-f239edaf317d","block_type":"box","text":"ewardship Guidelines |","page_number":507,"box":{"x":709,"y":909,"width":152,"height":12}},{"id":"330ccdac-9714-4358-b6e8-f289242f64cc","block_type":"box","text":"11","page_number":507,"box":{"x":867,"y":909,"width":14,"height":9}},{"id":"782a507f-827b-4a93-a92f-9ecde595aeaf","block_type":"box","text":"NM1026U-6004382-507/605","page_number":507,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"552ecfa6-3d1c-4241-a96b-d7f1bb37345e","block_type":"box","text":"Appendix 1","page_number":508,"box":{"x":116,"y":87,"width":95,"height":12}},{"id":"cf158089-8583-47e1-b489-a112f15929de","block_type":"box","text":"Terminology","page_number":508,"box":{"x":449,"y":115,"width":106,"height":12}},{"id":"7f2250ba-b0ac-4adc-a5dc-fa7c5188601c","block_type":"box","text":"We understand the key concepts referred to within these Guidelines as follows:","page_number":508,"box":{"x":116,"y":142,"width":593,"height":12}},{"id":"1b2f35fb-d8c5-4f28-99f9-ce3984c80e93","block_type":"box","text":"Climate risk","page_number":508,"box":{"x":116,"y":169,"width":95,"height":9}},{"id":"84c32d83-5f01-4cc7-9ef6-86cbed38b4fd","block_type":"box","text":": Includes physical risk, the increased risk to companies’ assets and activities caused by","page_number":508,"box":{"x":213,"y":169,"width":658,"height":12}},{"id":"4919cef5-0473-440a-845b-b3d0626cf56c","block_type":"box","text":"the direct impact of changing weather patterns and natural catastrophes, and transition risk, the impact","page_number":508,"box":{"x":116,"y":183,"width":768,"height":12}},{"id":"75b6f9da-8ed0-4827-b027-cecbb7cb6e78","block_type":"box","text":"of the transition to a low-carbon economy on a company’s long-term profitability.","page_number":508,"box":{"x":116,"y":197,"width":601,"height":12}},{"id":"498b988c-7ee6-4482-b1e1-d2212492f2da","block_type":"box","text":"Transition to a low-carbon economy (“low-carbon transition”)","page_number":508,"box":{"x":116,"y":224,"width":492,"height":12}},{"id":"50a1e9fa-3a19-4a37-887c-e25b95a247a1","block_type":"box","text":": The global economic shift toward","page_number":508,"box":{"x":610,"y":224,"width":259,"height":12}},{"id":"fb65f090-4b89-4b2d-9b45-c20d7a43192e","block_type":"box","text":"lower emissions across many sectors and business models. 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Please see each Fund’s","page_number":511,"box":{"x":478,"y":450,"width":400,"height":13}},{"id":"3df57883-4d90-49f2-9d40-aa865d2bf77c","block_type":"box","text":"prospectuses (the “Prospectus”) and the “Investment Objective and","page_number":511,"box":{"x":45,"y":465,"width":468,"height":13}},{"id":"ded7f920-28e1-4981-ad3d-dadbc7a6070f","block_type":"box","text":"Policies,” “Investment Objectives and Policies” or “Investment","page_number":511,"box":{"x":518,"y":465,"width":435,"height":13}},{"id":"25b27570-7b6f-4737-aa28-fb4c180021be","block_type":"box","text":"Strategies and Risks of the Fund” as applicable, section of Part I of this SAI for further information about each Fund’s investment","page_number":511,"box":{"x":46,"y":481,"width":897,"height":13}},{"id":"538d0102-5d5d-4cf3-96f1-65491518a5e8","block_type":"box","text":"policies and risks. Information contained in this section about","page_number":511,"box":{"x":45,"y":496,"width":428,"height":13}},{"id":"8f3614d7-7d00-4fac-90ce-328c43b43273","block_type":"box","text":"the risks and considerations associated with a Fund’s investments","page_number":511,"box":{"x":478,"y":496,"width":453,"height":10}},{"id":"4ef155a2-322b-4b13-bf92-524becce6579","block_type":"box","text":"and/or investment strategies applies only to those Funds specifically identified in Part I of this SAI as making each type of","page_number":511,"box":{"x":46,"y":512,"width":838,"height":13}},{"id":"838a5604-69ac-4d49-bfab-7983f7ed2057","block_type":"box","text":"investment or using each investment strategy (each, a “Cov","page_number":511,"box":{"x":45,"y":527,"width":410,"height":13}},{"id":"bf3b7a8e-7335-4824-a41d-eda40e2bbd3c","block_type":"box","text":"ered Fund”). Information that does not apply to a Covered Fund does","page_number":511,"box":{"x":456,"y":527,"width":485,"height":13}},{"id":"f9a3e35c-622d-47b1-8ed7-1c8af26c410a","block_type":"box","text":"not form a part of that Covered Fund’s SAI and should not be relied upon by investors in that Covered Fund.","page_number":511,"box":{"x":45,"y":543,"width":758,"height":13}},{"id":"9d741a7d-39ca-49fb-bbc3-a790cf393b69","block_type":"box","text":"Only information that is clearly identified as applicable to","page_number":511,"box":{"x":46,"y":566,"width":400,"height":13}},{"id":"6340290d-35f0-4c3a-a807-791975b2d314","block_type":"box","text":"a Covered Fund is considered to form a part of that Covered Fund’s","page_number":511,"box":{"x":452,"y":566,"width":471,"height":13}},{"id":"ae1d7768-fdc6-415d-86c8-61ce72bf5373","block_type":"box","text":"SAI.","page_number":511,"box":{"x":46,"y":582,"width":27,"height":10}},{"id":"819d4a62-0707-40d7-8e7c-8849bb6665a3","block_type":"box","text":"Bank Money Instruments.","page_number":511,"box":{"x":45,"y":605,"width":182,"height":13}},{"id":"0d7aa9a5-b358-4691-8ac5-26dfb53bab84","block_type":"box","text":"Certain Funds may invest in U.S. dollar-denominated obligations of U.S. and foreign depository","page_number":511,"box":{"x":233,"y":605,"width":664,"height":13}},{"id":"9d2a337f-f15f-4cdf-8524-2a452336ffac","block_type":"box","text":"institutions, including commercial and savings banks, savings and","page_number":511,"box":{"x":45,"y":621,"width":456,"height":13}},{"id":"30d1e2f0-e022-4b16-a57a-1f68b7bb3f5c","block_type":"box","text":"loan associations, and other institutions. Such obligations","page_number":511,"box":{"x":506,"y":621,"width":398,"height":13}},{"id":"6cc0889a-d7d0-4149-af89-cd2e96fbaced","block_type":"box","text":"include but are not limited to certificates of deposit, bankers’ acceptances, time deposits, bank notes and deposit notes. For","page_number":511,"box":{"x":45,"y":636,"width":851,"height":13}},{"id":"b1654320-2a59-453e-9d62-3422c587fbcd","block_type":"box","text":"example, the obligations may be issued by (i) U.S. or foreign depos","page_number":511,"box":{"x":46,"y":652,"width":461,"height":13}},{"id":"47908d15-6160-48ce-8821-59b89f3f2068","block_type":"box","text":"itory institutions, (ii) foreign branches or subsidiaries of U.S.","page_number":511,"box":{"x":508,"y":652,"width":417,"height":13}},{"id":"97a50481-7642-4431-a141-1ee2b447c4a9","block_type":"box","text":"depository institutions (“Eurodollar” obligations), (iii) U.S. branches or subsidiaries of foreign depository institutions","page_number":511,"box":{"x":46,"y":667,"width":811,"height":13}},{"id":"413adfb2-38b2-4aa4-82be-a4b738c6a84b","block_type":"box","text":"(“Yankeedollar” obligations) or (iv) foreign branches or s","page_number":511,"box":{"x":46,"y":683,"width":399,"height":13}},{"id":"30c6c80c-8683-4298-9ceb-9557e0771d13","block_type":"box","text":"ubsidiaries of foreign depository institutions. Eurodollar and","page_number":511,"box":{"x":446,"y":683,"width":419,"height":13}},{"id":"d79e2221-8201-4b22-a8d2-9b2afdb43e16","block_type":"box","text":"Yankeedollar obligations and obligations of branches or subsid","page_number":511,"box":{"x":45,"y":698,"width":439,"height":13}},{"id":"70fa28df-c4a3-4b81-850b-551905331f05","block_type":"box","text":"iaries of foreign depository institutions may be general obligations","page_number":511,"box":{"x":484,"y":698,"width":458,"height":13}},{"id":"54016c00-ebeb-48b5-b67b-3256b69544e0","block_type":"box","text":"of the parent bank or may be limited to the issuing branch or subsidiary by the terms of the specific obligations or by government","page_number":511,"box":{"x":46,"y":714,"width":897,"height":13}},{"id":"03bde214-c3b6-4eb8-9a3f-cf7412c4b59f","block_type":"box","text":"regulation. Investments in obligations of foreign depository in","page_number":511,"box":{"x":45,"y":729,"width":428,"height":13}},{"id":"eae239f2-881f-4494-bb90-e4c487e5021f","block_type":"box","text":"stitutions and their foreign branches and subsidiaries will only be","page_number":511,"box":{"x":474,"y":729,"width":451,"height":13}},{"id":"18a0182a-d293-468d-82e8-bd963883f3db","block_type":"box","text":"made if determined to be of comparable quality to other investments permissible for each Fund. No Fund will invest more than","page_number":511,"box":{"x":45,"y":745,"width":883,"height":13}},{"id":"f51c6e96-03d1-4751-864e-f3bbeca0038c","block_type":"box","text":"25% of its total assets (taken at market value at the time of each investment) in obligations of foreign depository institutions and","page_number":511,"box":{"x":45,"y":760,"width":893,"height":13}},{"id":"4ca4ffad-72fa-4940-a63f-63de3cf80681","block_type":"box","text":"their foreign branches and subsidiaries or in obligations of foreign","page_number":511,"box":{"x":45,"y":776,"width":458,"height":13}},{"id":"fde7c0f8-650b-492c-88d1-19a185db79a1","block_type":"box","text":"branches or subsidiaries of U.S. depository institutions that are","page_number":511,"box":{"x":508,"y":776,"width":434,"height":13}},{"id":"3fd679f9-21a3-46ea-80c1-40fbe6749af7","block_type":"box","text":"not backed by the U.S. parent. The Funds treat bank money instruments issued by U.S. branches or subsidiaries of foreign banks","page_number":511,"box":{"x":45,"y":791,"width":891,"height":13}},{"id":"103cc34b-4a5a-4874-8bfe-06ae070e6f80","block_type":"box","text":"as obligations issued by domestic banks (not subject to the 25% limitation) if the branch or subsidiary is subject to the same bank","page_number":511,"box":{"x":46,"y":807,"width":899,"height":13}},{"id":"622cd243-3f93-47b8-acf3-5d9091e0fc6a","block_type":"box","text":"regulation as U.S. banks.","page_number":511,"box":{"x":45,"y":822,"width":171,"height":13}},{"id":"b29e584b-395b-47df-943a-0520f877a316","block_type":"box","text":"Eurodollar and Yankeedollar obligations, as well as other obliga","page_number":511,"box":{"x":45,"y":846,"width":447,"height":13}},{"id":"2ed9197e-e37c-4ab3-af7f-1c41ff35518d","block_type":"box","text":"tions of foreign depository institutions and short term obligations","page_number":511,"box":{"x":493,"y":846,"width":454,"height":13}},{"id":"931292cd-46b0-4580-864f-8dc25deab925","block_type":"box","text":"issued by other foreign entities, may involve additional investme","page_number":511,"box":{"x":45,"y":861,"width":444,"height":13}},{"id":"d48567be-a57b-4536-b1d0-cad0c53f53c2","block_type":"box","text":"nt risks, including adverse political and economic developments,","page_number":511,"box":{"x":490,"y":861,"width":445,"height":13}},{"id":"93a40577-7464-4233-9091-a88f1db2717a","block_type":"box","text":"the possible imposition of withholding taxes on interest income payab","page_number":511,"box":{"x":45,"y":877,"width":486,"height":13}},{"id":"e2ad456c-24ff-4347-bfb6-bf19d35ab8a4","block_type":"box","text":"le on such obligations, the possible seizure or nationalization","page_number":511,"box":{"x":532,"y":877,"width":420,"height":13}},{"id":"0deb5e63-6e17-4efd-8fce-934b99197f31","block_type":"box","text":"II-1","page_number":511,"box":{"x":487,"y":917,"width":24,"height":9}},{"id":"470582ac-8b39-4421-ade6-a46ff00e844f","block_type":"box","text":"NM1026U-6004382-511/605","page_number":511,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"efde669c-b7e1-4ec8-9add-b465a636e24b","block_type":"box","text":"of foreign deposits and the possible establishment of exchange cont","page_number":512,"box":{"x":46,"y":79,"width":465,"height":13}},{"id":"2c4e0366-f974-4e7b-bc14-a28d609d275c","block_type":"box","text":"rols or other foreign governmental laws or restrictions that","page_number":512,"box":{"x":512,"y":79,"width":407,"height":13}},{"id":"350c88f9-15a6-4a6d-8c73-d610ef4feb1f","block_type":"box","text":"might adversely affect the repayment of principal and the payment of interest. The issuers of such obligations may not be subject","page_number":512,"box":{"x":45,"y":94,"width":891,"height":13}},{"id":"5144157f-f400-45cc-bcda-5e2eabf30fd2","block_type":"box","text":"to U.S. regulatory requirements. Foreign branches or subs","page_number":512,"box":{"x":45,"y":110,"width":400,"height":13}},{"id":"c7bbac6a-850b-43bd-b423-eb7d9110e02c","block_type":"box","text":"idiaries of U.S. banks may be subject to less stringent reserve","page_number":512,"box":{"x":446,"y":110,"width":418,"height":13}},{"id":"5b5539c8-e488-44b3-a6d5-8ef8adbe36b1","block_type":"box","text":"requirements than U.S. banks. U.S. branches or subsidiaries of foreign banks are subject to the reserve requirements of the states in","page_number":512,"box":{"x":45,"y":125,"width":906,"height":13}},{"id":"e97e5ea1-ab4e-4214-9d8d-c49a3a487029","block_type":"box","text":"which they are located. There may be less publicly available information about a U.S. branch or subsidiary of a foreign bank or","page_number":512,"box":{"x":45,"y":141,"width":884,"height":13}},{"id":"4aa9d2df-21a1-4bab-b289-5cb892562825","block_type":"box","text":"other issuer than about a U.S. bank or other issuer, and such entities may not be subject to the same accounting, auditing and","page_number":512,"box":{"x":46,"y":156,"width":869,"height":13}},{"id":"e6068123-a37e-4d44-a6fb-b12e5067ea93","block_type":"box","text":"financial record keeping standards and requirements as U.S. issu","page_number":512,"box":{"x":45,"y":172,"width":446,"height":13}},{"id":"dccf3db5-4062-49a2-8d1f-c2dba3a87caa","block_type":"box","text":"ers. Evidence of ownership of Eurodollar and foreign obligations","page_number":512,"box":{"x":491,"y":172,"width":449,"height":13}},{"id":"14ee54ba-e345-4dc3-89f4-eba128d9f035","block_type":"box","text":"may be held outside the United States, and the Funds may be subject to the risks associated with the holding of such property","page_number":512,"box":{"x":45,"y":187,"width":868,"height":13}},{"id":"99399075-bd37-49e9-bfed-c3f896c67281","block_type":"box","text":"overseas. Eurodollar and foreign obligations of the Funds held overseas will be held by foreign branches of each Fund’s custodian","page_number":512,"box":{"x":46,"y":203,"width":897,"height":13}},{"id":"5594a321-ac4e-44ad-9c59-0cd3003b7e14","block_type":"box","text":"or by other U.S. or foreign banks under subcustodian arrangements complying with the requirements of the Investment Company","page_number":512,"box":{"x":46,"y":218,"width":899,"height":13}},{"id":"c645024b-dbaf-4c9d-b6d0-068f6b027e7a","block_type":"box","text":"Act.","page_number":512,"box":{"x":45,"y":234,"width":28,"height":10}},{"id":"70d30f2b-078a-4cbf-91df-f46d543bbc18","block_type":"box","text":"The Manager will carefully consider the above factors in making investments in Eurodollar obligations, Yankeedollar obligations","page_number":512,"box":{"x":45,"y":257,"width":896,"height":13}},{"id":"84b04e47-8acb-4fe6-bc66-d525de68dd67","block_type":"box","text":"of foreign depository institutions and other foreign short term ob","page_number":512,"box":{"x":46,"y":273,"width":450,"height":12}},{"id":"ab9aacce-c06c-4ba3-9479-e5015d332421","block_type":"box","text":"ligations, and will not knowingly purchase obligations that, at","page_number":512,"box":{"x":497,"y":273,"width":431,"height":12}},{"id":"d9dab8a4-c70f-46c0-976e-8db44aa823ec","block_type":"box","text":"the time of purchase, are subject to exchange controls or wit","page_number":512,"box":{"x":45,"y":288,"width":419,"height":13}},{"id":"b3d8cbdb-920d-44d7-baa9-9f36367d4e1d","block_type":"box","text":"hholding taxes. Generally, a Fund will limit its Yankeedollar","page_number":512,"box":{"x":464,"y":288,"width":420,"height":13}},{"id":"88e11ee3-8722-4791-a4d2-5f6f22e7b9e7","block_type":"box","text":"investments to obligations of banks organized in Canada, France, Germany, Japan, the Netherlands, Switzerland, the United","page_number":512,"box":{"x":45,"y":304,"width":864,"height":12}},{"id":"901d0d94-a263-438b-85b1-96e608eaf3c0","block_type":"box","text":"Kingdom or other industrialized nations.","page_number":512,"box":{"x":45,"y":319,"width":282,"height":13}},{"id":"538684e6-b634-4c5c-a7d1-7ea54e5c6026","block_type":"box","text":"Bank money instruments in which certain Funds invest must be","page_number":512,"box":{"x":46,"y":342,"width":438,"height":13}},{"id":"ef3255af-23f5-4c2f-9053-b4ccc5eb4a8a","block_type":"box","text":"issued by depository institutions with total assets of at least","page_number":512,"box":{"x":489,"y":342,"width":411,"height":13}},{"id":"98c1a62f-e81b-4b2a-99bc-26cc14e9ff6f","block_type":"box","text":"$1 billion, except that such Funds may invest in certificates of deposit of smaller institutions if such certificates of deposit are","page_number":512,"box":{"x":46,"y":358,"width":863,"height":13}},{"id":"5d557d6d-6714-4568-857b-d6a422b01264","block_type":"box","text":"Federally insured and if, as a result of such purchase, no more than 10% of total assets (taken at market value), are invested in","page_number":512,"box":{"x":45,"y":373,"width":878,"height":13}},{"id":"ae4a6b63-5c04-43b0-a806-92956cc53f38","block_type":"box","text":"such certificates of deposit.","page_number":512,"box":{"x":46,"y":389,"width":185,"height":13}},{"id":"96f2cfdb-8e42-4a97-a11b-6d9cc8576e2a","block_type":"box","text":"Commercial Paper and Other Short Term Obligations","page_number":512,"box":{"x":46,"y":412,"width":382,"height":13}},{"id":"cda85035-2d35-440b-9e91-ff1085d09db7","block_type":"box","text":". Commercial paper (including variable amount master demand notes and","page_number":512,"box":{"x":429,"y":412,"width":512,"height":13}},{"id":"9dfa3318-ef72-4732-96d1-1204ffce0970","block_type":"box","text":"other variable rate securities, with or without forward features) refers to short term unsecured promissory notes issued by","page_number":512,"box":{"x":46,"y":428,"width":842,"height":12}},{"id":"a967160d-4487-4b45-973f-859955f7866d","block_type":"box","text":"corporations, partnerships, trusts or other entities to finance short term credit needs and non-convertible debt securities (","page_number":512,"box":{"x":45,"y":443,"width":836,"height":13}},{"id":"e479d042-fd0b-42a2-8ed7-1f72bfb06bc5","block_type":"box","text":"e.g.,","page_number":512,"box":{"x":883,"y":447,"width":26,"height":9}},{"id":"b0eb1970-56ae-4331-99df-49a481fae36c","block_type":"box","text":"bonds and debentures) with no more than 397 days remaining to matur","page_number":512,"box":{"x":46,"y":459,"width":498,"height":12}},{"id":"f213b659-e1d2-48a7-a77e-c8162cc3c74f","block_type":"box","text":"ity at the date of purchase. Short term obligations issued","page_number":512,"box":{"x":544,"y":459,"width":391,"height":12}},{"id":"49a1fff6-c1da-49ae-bdc2-a3d4effef1c0","block_type":"box","text":"by trusts, corporations, partnerships or other entities include mortgage","page_number":512,"box":{"x":46,"y":474,"width":489,"height":13}},{"id":"99a044aa-6b1d-4796-a4ae-f9ebc233e402","block_type":"box","text":"-related or asset-backed instruments, including pass-through","page_number":512,"box":{"x":536,"y":474,"width":417,"height":13}},{"id":"1aa33f2e-abce-4ed5-9d24-8f86db8ee076","block_type":"box","text":"certificates such as participations in, or bonds and notes backed by, pools of mortgage, automobile, manufactured housing or","page_number":512,"box":{"x":45,"y":490,"width":870,"height":12}},{"id":"bd97c4fb-b0b0-4ce5-bcaf-f2c16764b0de","block_type":"box","text":"other types of consumer loans; credit card or trade receivables or pools of mortgage-backed or asset-backed securities. These","page_number":512,"box":{"x":46,"y":505,"width":863,"height":13}},{"id":"00e4afcd-c42e-4ffc-92af-de6b9d54f4ff","block_type":"box","text":"structured financings will be supported by sufficient collateral and","page_number":512,"box":{"x":46,"y":521,"width":458,"height":12}},{"id":"308608e6-42d6-41ec-bd7c-856c6a6f6a79","block_type":"box","text":"other credit enhancements, including letters of credit, insurance,","page_number":512,"box":{"x":509,"y":521,"width":442,"height":12}},{"id":"a8c64a12-0168-4784-8644-99f0e8c8994a","block_type":"box","text":"reserve funds and guarantees by third parties, to enable such inst","page_number":512,"box":{"x":45,"y":536,"width":448,"height":13}},{"id":"26e76f9e-e786-44a0-8a6a-cc01d08c9348","block_type":"box","text":"ruments to obtain a quality rating by a Nationally Recognized","page_number":512,"box":{"x":494,"y":536,"width":431,"height":13}},{"id":"4be5f8e5-7ff2-4654-8bce-7a5c63a255a1","block_type":"box","text":"Statistical Rating Organization (“NRSRO”), if applicable. Some structured financings also use various types of swaps, among","page_number":512,"box":{"x":46,"y":552,"width":872,"height":12}},{"id":"5d16f3d1-0bfc-4f5c-8baf-ba74877d3cd2","block_type":"box","text":"other things, to issue instruments that have interest rate, quality or maturity characteristics necessary or desirable for a Fund.","page_number":512,"box":{"x":46,"y":567,"width":863,"height":13}},{"id":"c2242c18-02a2-4c42-b231-87920d12055e","block_type":"box","text":"These swaps may include so-called credit default swaps that might depend for payment not only on the credit of a counterparty,","page_number":512,"box":{"x":45,"y":583,"width":888,"height":12}},{"id":"9d933078-2e78-40e3-bbc2-5d6c6124ca47","block_type":"box","text":"but also on the obligations of another entity, the “reference entity.” Commercial paper is generally considered to be short-term","page_number":512,"box":{"x":46,"y":598,"width":879,"height":13}},{"id":"6ad06223-51e6-44f3-8888-5bad795613e2","block_type":"box","text":"unsecured debt of corporations. Like all fixed income securities,","page_number":512,"box":{"x":46,"y":614,"width":441,"height":12}},{"id":"98720d08-67e9-4324-a27a-de1507509af0","block_type":"box","text":"commercial paper prices are susceptible to fluctuations in interest","page_number":512,"box":{"x":493,"y":614,"width":452,"height":12}},{"id":"97373236-c6af-41c8-a198-8eaa6dee3df8","block_type":"box","text":"rates. If interest rates rise, commercial paper prices will declin","page_number":512,"box":{"x":45,"y":629,"width":427,"height":13}},{"id":"d5b05608-ce45-4dac-8bfb-cb7b69bc6d2f","block_type":"box","text":"e and vice versa. However, the short-term nature of a commercial","page_number":512,"box":{"x":472,"y":629,"width":455,"height":12}},{"id":"491fc9ec-aea2-47c4-8e4a-4f7398bc9d2f","block_type":"box","text":"paper investment generally makes it less susceptible to volatility th","page_number":512,"box":{"x":45,"y":645,"width":459,"height":12}},{"id":"0485b095-1438-4ddb-815d-9fa7ad487ad3","block_type":"box","text":"an many other fixed income securities because interest rate risk","page_number":512,"box":{"x":505,"y":645,"width":437,"height":12}},{"id":"30deaeef-76dd-497d-8ad8-74fa2316ec1f","block_type":"box","text":"typically increases as maturity lengths increase. Commercial paper tends to yield smaller returns than longer-term corporate debt","page_number":512,"box":{"x":45,"y":660,"width":892,"height":13}},{"id":"65c5ff28-3c78-42e2-a3dd-9f456d84854e","block_type":"box","text":"because securities with shorter maturities typically have lower effective yields than those with longer maturities.","page_number":512,"box":{"x":46,"y":676,"width":771,"height":12}},{"id":"64b587c3-afc1-4d6e-a774-0a4dedd21781","block_type":"box","text":"Environmental, Social and Governance (“ESG”) Integration","page_number":512,"box":{"x":45,"y":707,"width":426,"height":13}},{"id":"08767311-3492-483f-ac82-86bd63cdeb2a","block_type":"box","text":". Although a Fund does not seek to implement a specific","page_number":512,"box":{"x":473,"y":707,"width":387,"height":12}},{"id":"d7091d77-82d7-474e-a860-a9e1265637d0","block_type":"box","text":"sustainability objective, strategy or process unless disclosed in th","page_number":512,"box":{"x":46,"y":722,"width":445,"height":13}},{"id":"8591fd87-9f94-4cc0-880d-1622fd918b1a","block_type":"box","text":"e Fund’s Prospectus, BlackRock will consider ESG factors as part","page_number":512,"box":{"x":491,"y":722,"width":452,"height":13}},{"id":"37c57c27-21d6-4156-9401-8427d5c85bc4","block_type":"box","text":"of the credit research and investment process for a Fund. BlackRock views ESG integration as the practice of incorporating","page_number":512,"box":{"x":46,"y":738,"width":852,"height":12}},{"id":"3ea99eae-3559-47e6-bc3a-c1ed76c96852","block_type":"box","text":"financially material ESG data or information into investment processes with the objective of enhancing risk-adjusted returns. All","page_number":512,"box":{"x":45,"y":753,"width":890,"height":13}},{"id":"0f5d3d71-f5e8-4c66-a3e9-6aba84846aaf","block_type":"box","text":"securities purchases by a Fund are selected from approved lists maintained by BlackRock. All instruments on an approved list used","page_number":512,"box":{"x":46,"y":769,"width":905,"height":13}},{"id":"50385d71-0712-4ff7-8434-6c5e5cc5e839","block_type":"box","text":"by a Fund have met the minimal credit risk requirement of Rule 2a-7, if required. In reviewing instruments, BlackRock will","page_number":512,"box":{"x":46,"y":784,"width":853,"height":13}},{"id":"b10c3814-ac20-4d7d-866b-e0fd7d18ea55","block_type":"box","text":"consider the capacity of the issuer or guarantor to meet its obli","page_number":512,"box":{"x":45,"y":800,"width":434,"height":13}},{"id":"76b752e7-de4c-47e9-a3a0-d426dc9884b9","block_type":"box","text":"gations. BlackRock considers ESG data within the total data","page_number":512,"box":{"x":480,"y":800,"width":419,"height":13}},{"id":"0d0ebd95-aad1-4a2a-bdec-07542d8d5506","block_type":"box","text":"available during its review. This may include third party research as well as considerations of proprietary BlackRock research","page_number":512,"box":{"x":46,"y":815,"width":868,"height":13}},{"id":"f194dd07-a2c1-4d9b-8e57-4f7d70f6d9a1","block_type":"box","text":"across the ESG risks and opportunities regarding an issuer.","page_number":512,"box":{"x":46,"y":831,"width":406,"height":13}},{"id":"16d361ea-c00f-47a7-bc0a-7566ed2c0b35","block_type":"box","text":"The ESG characteristics utilized in a Fund’s investment processes are anticipated to evolve over time and one or more","page_number":512,"box":{"x":45,"y":862,"width":813,"height":13}},{"id":"9b9751d3-73a1-42a4-b762-c12711efdd00","block_type":"box","text":"characteristics may not be relevant with respect to all issuers that are eligible for investment. Certain of these considerations may","page_number":512,"box":{"x":45,"y":877,"width":891,"height":13}},{"id":"6bd6ec79-6a07-4894-ba3e-584063b0150f","block_type":"box","text":"II-2","page_number":512,"box":{"x":487,"y":917,"width":25,"height":9}},{"id":"2dc5a59b-9434-42aa-bd9d-a3ed62c65118","block_type":"box","text":"NM1026U-6004382-512/605","page_number":512,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"35c0974d-6d85-4d13-a573-62b2d667c7d0","block_type":"box","text":"affect the Fund’s exposure to certain companies or industries. Wh","page_number":513,"box":{"x":46,"y":79,"width":455,"height":13}},{"id":"6559103d-8ebd-400a-9ecd-d66aae611e6c","block_type":"box","text":"ile BlackRock views ESG considerations as having the potential","page_number":513,"box":{"x":501,"y":79,"width":440,"height":13}},{"id":"07cd878e-fd96-47c5-93a2-8defc137cca1","block_type":"box","text":"to contribute to a Fund’s long-term performance, there is no guarantee that such results will be achieved.","page_number":513,"box":{"x":45,"y":94,"width":726,"height":13}},{"id":"3371fe4a-94f4-4219-834e-11c854540d8e","block_type":"box","text":"Foreign Bank Money Instruments","page_number":513,"box":{"x":45,"y":118,"width":237,"height":12}},{"id":"41e8c4f9-dc2b-492c-9563-3b5152c264e6","block_type":"box","text":". Foreign bank money instruments refer to U.S. dollar-denominated obligations of foreign","page_number":513,"box":{"x":283,"y":118,"width":620,"height":12}},{"id":"a9489452-4391-4ca1-91e4-e41be73bfc03","block_type":"box","text":"depository institutions and their foreign branches and subsidiaries, such as, but not limited to, certificates of deposit, bankers’","page_number":513,"box":{"x":46,"y":133,"width":869,"height":13}},{"id":"59f923e0-d76f-40a5-b5ea-7121683b9c08","block_type":"box","text":"acceptances, time deposits, bank notes and deposit notes. The obli","page_number":513,"box":{"x":46,"y":149,"width":458,"height":12}},{"id":"6d484fd8-9530-4940-ae9a-75636e614c0c","block_type":"box","text":"gations of such foreign depository institutions and their foreign","page_number":513,"box":{"x":505,"y":149,"width":437,"height":12}},{"id":"3371360d-3b71-44bf-a60f-d5db8427bb6f","block_type":"box","text":"branches and subsidiaries may be the general obligations of the parent bank or may be limited to the issuing branch or subsidiary","page_number":513,"box":{"x":46,"y":164,"width":896,"height":13}},{"id":"0859a613-d75e-4b81-8581-a3f6ee3d8412","block_type":"box","text":"by the terms of the specific obligation or by government regulation. Such investments will only be made if determined to be of","page_number":513,"box":{"x":46,"y":180,"width":873,"height":12}},{"id":"35a1250f-4f6c-460b-944b-57661ca21951","block_type":"box","text":"comparable quality to other investments permissible for a Fund. A Fund will not invest more than 25% of its total assets (taken at","page_number":513,"box":{"x":45,"y":195,"width":903,"height":13}},{"id":"5e011ee9-eb73-4401-bb65-6a63575be0ce","block_type":"box","text":"market value at the time of each investment) in these obligations. Investments in foreign entities generally involve the same risks as","page_number":513,"box":{"x":45,"y":211,"width":904,"height":12}},{"id":"8f434d29-41bc-42cd-8d97-eb70a3ee1bc6","block_type":"box","text":"those described above in connection with investments in Eurodollar and Yankeedollar obligations and obligations of foreign","page_number":513,"box":{"x":45,"y":226,"width":863,"height":13}},{"id":"d9a799e3-4a72-4498-a6c8-e94c1dd0650c","block_type":"box","text":"depository institutions and their foreign branches and subsidiaries. See “Bank Money Instruments.”","page_number":513,"box":{"x":46,"y":242,"width":690,"height":12}},{"id":"06122590-b63e-4529-96c9-efe80f8aa5e9","block_type":"box","text":"Foreign Short Term Debt Instruments","page_number":513,"box":{"x":45,"y":265,"width":265,"height":13}},{"id":"5d8b6e18-1372-437f-b351-32a47318bbb2","block_type":"box","text":". Foreign short term debt instruments refer to U.S. dollar-denominated commercial paper","page_number":513,"box":{"x":312,"y":265,"width":616,"height":13}},{"id":"122e9e65-7fd4-4577-92ba-36ab4c45bc1b","block_type":"box","text":"and other short term obligations issued by foreign entities. Such","page_number":513,"box":{"x":46,"y":280,"width":441,"height":13}},{"id":"5e390b3d-5e7b-446c-b451-3b65ea18a0b6","block_type":"box","text":"investments are subject to quality standards similar to those","page_number":513,"box":{"x":492,"y":280,"width":413,"height":13}},{"id":"24dcde78-7205-4f00-9dce-107b1858807f","block_type":"box","text":"applicable to investments in comparable obligations of domes","page_number":513,"box":{"x":46,"y":296,"width":427,"height":13}},{"id":"7aa55fb4-c05f-4036-a6b5-4af8b918a653","block_type":"box","text":"tic issuers. These investments generally involve the same risks as","page_number":513,"box":{"x":474,"y":296,"width":442,"height":13}},{"id":"13e10c36-2529-4423-b612-a59a8f719b4b","block_type":"box","text":"those described above in connection with investments in Eurodollar and Yankeedollar obligations and obligations of foreign","page_number":513,"box":{"x":45,"y":311,"width":863,"height":13}},{"id":"ccd8d90b-3f96-4ea7-b446-64c6f8d8dfbb","block_type":"box","text":"depository institutions and their foreign branches and subsidiaries. See “Bank Money Instruments.”","page_number":513,"box":{"x":46,"y":327,"width":689,"height":13}},{"id":"468039fb-4304-4e5c-a10f-970cf0003789","block_type":"box","text":"Forward Commitments","page_number":513,"box":{"x":45,"y":350,"width":166,"height":10}},{"id":"a4661a12-4e1f-4918-b82f-fc0e323bccf9","block_type":"box","text":". Certain Funds may purchase or sell money market securities on a forward commitment basis at fixed","page_number":513,"box":{"x":212,"y":350,"width":709,"height":13}},{"id":"3a66ba65-89d6-495b-94ea-29ce9590da16","block_type":"box","text":"purchase terms. The purchase or sale will be recorded on the date a F","page_number":513,"box":{"x":45,"y":366,"width":481,"height":12}},{"id":"dbece3cf-2d55-4793-b6e5-be1f58d3cc27","block_type":"box","text":"und enters into the commitment, and the value of the security","page_number":513,"box":{"x":526,"y":366,"width":427,"height":12}},{"id":"e892a136-a574-49d8-99da-f2b5c6d9ac70","block_type":"box","text":"will thereafter be reflected in the calculation of the Fund’s NAV. The value of the security on the delivery date may be more or less","page_number":513,"box":{"x":45,"y":381,"width":905,"height":13}},{"id":"7b66cbde-569f-4db8-8ba6-113f0eecf633","block_type":"box","text":"than its purchase price. Although a Fund generally will enter into fo","page_number":513,"box":{"x":45,"y":397,"width":462,"height":12}},{"id":"1b93439c-1ee9-454b-a38f-a34fcfef7e19","block_type":"box","text":"forward commitments with the intention of acquiring securities","page_number":513,"box":{"x":507,"y":397,"width":434,"height":12}},{"id":"772360fe-1fbd-42e5-911d-fea92495a12b","block_type":"box","text":"for its portfolio, a Fund may dispose of a commitment prior","page_number":513,"box":{"x":45,"y":412,"width":416,"height":13}},{"id":"a109ee5d-99e3-4397-b2bc-6dd94dcec54e","block_type":"box","text":"to settlement if the Manager deems it appropriate to do so.","page_number":513,"box":{"x":466,"y":412,"width":408,"height":13}},{"id":"12df43c1-75fd-49b6-bbb4-b904c6e34ab6","block_type":"box","text":"There can be no assurance that a security purchased or sold th","page_number":513,"box":{"x":45,"y":435,"width":432,"height":13}},{"id":"d597e062-eed3-4700-8088-d940a027f706","block_type":"box","text":"rough a forward commitment will be delivered. The value of","page_number":513,"box":{"x":478,"y":435,"width":421,"height":13}},{"id":"69c6f155-3588-45c5-83a3-b2485161ef3c","block_type":"box","text":"securities in these transactions on the delivery date may be more or less than a Fund’s purchase price. The Fund may bear the risk","page_number":513,"box":{"x":46,"y":451,"width":896,"height":13}},{"id":"7c354d45-f9d8-41b8-98ba-b72a120c406b","block_type":"box","text":"of a decline in the value of the security in these transactions and may not benefit from appreciation in the value of the security","page_number":513,"box":{"x":46,"y":466,"width":872,"height":13}},{"id":"bffbbfd4-a31f-4ada-8ce9-f20cd9292d24","block_type":"box","text":"during the commitment period.","page_number":513,"box":{"x":46,"y":482,"width":216,"height":13}},{"id":"9355c7c1-3124-4c4e-8964-56411cd7b899","block_type":"box","text":"Illiquid Investments","page_number":513,"box":{"x":45,"y":505,"width":140,"height":13}},{"id":"90baf6ac-fe62-4cd0-af3b-dcb5ebf0789d","block_type":"box","text":". No Fund will acquire any illiquid security (i.e., securities that cannot be sold or disposed of in the ordinary","page_number":513,"box":{"x":186,"y":505,"width":748,"height":13}},{"id":"8cd61289-a786-40f6-8af2-6df50bad9d85","block_type":"box","text":"course of business within seven days at approximately the value ascribed to them by the Fund) if, immediately following such","page_number":513,"box":{"x":45,"y":521,"width":870,"height":12}},{"id":"5d5503f8-d8fd-4d4a-9ae2-2d940ab003a9","block_type":"box","text":"purchase, more than 5% of the Fund’s total assets are invested","page_number":513,"box":{"x":45,"y":536,"width":434,"height":13}},{"id":"32b742bb-d9ef-42fe-a810-85dbfb5f695d","block_type":"box","text":"in illiquid securities. The Manager will monitor the liquidity of","page_number":513,"box":{"x":484,"y":536,"width":436,"height":13}},{"id":"9f3f84bc-20cd-48e2-9add-1d4d8dc7f097","block_type":"box","text":"illiquid investments under the supervision of the Board.","page_number":513,"box":{"x":45,"y":552,"width":383,"height":12}},{"id":"f4ecd36c-120a-4e1f-8c2d-04c07c1e2f60","block_type":"box","text":"Inflation Risk.","page_number":513,"box":{"x":45,"y":575,"width":100,"height":13}},{"id":"69ce649a-141e-4540-b613-c1d2ca651263","block_type":"box","text":"The Funds are subject to inflation risk. Inflation risk is the risk that the present value of assets or income from","page_number":513,"box":{"x":151,"y":575,"width":762,"height":13}},{"id":"50b44f4f-0d35-43d9-b5a2-a3965ce8f5ab","block_type":"box","text":"investments will be less in the future as inflation decreases the value of money. As inflation increases, the present value of a Fund’s","page_number":513,"box":{"x":45,"y":590,"width":902,"height":13}},{"id":"dabd43d3-4f4e-454a-b3df-a55f4e5e161c","block_type":"box","text":"assets can decline as can the value of a Fund’s distributions. Inflation rates may change frequently and significantly due to a","page_number":513,"box":{"x":46,"y":606,"width":855,"height":13}},{"id":"b441b611-d3c1-474a-a9b2-e17a46ff7e4e","block_type":"box","text":"number of potential factors, including, among others, unexpect","page_number":513,"box":{"x":45,"y":621,"width":439,"height":13}},{"id":"abb16aee-6310-481f-97b3-65b70cdc005a","block_type":"box","text":"ed economic shifts or changes in fiscal or monetary policies.","page_number":513,"box":{"x":484,"y":621,"width":414,"height":13}},{"id":"95ac284f-60cb-4960-a8ef-be850901a0ee","block_type":"box","text":"Investment in Other Investment Companies.","page_number":513,"box":{"x":45,"y":645,"width":311,"height":13}},{"id":"43d3978d-26ca-486b-9856-59d9b7dd8262","block_type":"box","text":"Each Fund may, subject to applicable law, invest in other investment companies","page_number":513,"box":{"x":362,"y":645,"width":554,"height":12}},{"id":"814247c6-aec6-4393-ab57-51ef08ff0611","block_type":"box","text":"(including investment companies managed by BlackRock and its affiliates), including money market funds and exchange-traded","page_number":513,"box":{"x":46,"y":660,"width":885,"height":13}},{"id":"545e8c7e-b484-4a9d-8e43-df43b474c129","block_type":"box","text":"funds (“ETFs”), which are typically open-end funds or unit investment trusts listed on a stock exchange. Under","page_number":513,"box":{"x":45,"y":676,"width":771,"height":12}},{"id":"863e641b-fe09-428a-84f0-894442e8e8ed","block_type":"box","text":"Section 12(d)(1)(A) of the Investment Company Act, however, a Fund may invest up to 10% of its total assets in securities of","page_number":513,"box":{"x":46,"y":691,"width":867,"height":13}},{"id":"828c8fcf-5c71-4d38-8434-0c33169d570e","block_type":"box","text":"other investment companies (measured at the time of such invest","page_number":513,"box":{"x":46,"y":707,"width":447,"height":12}},{"id":"f4b54a59-3346-4510-a725-c2301151acf8","block_type":"box","text":"ment). In addition, under Section 12(d)(1)(A) of the Investment","page_number":513,"box":{"x":493,"y":707,"width":438,"height":12}},{"id":"035ee6f7-940d-4cd8-9da1-7484f6965927","block_type":"box","text":"Company Act a Fund may not acquire securities of an investment company if such acquisition would cause the Fund to own more","page_number":513,"box":{"x":46,"y":722,"width":903,"height":13}},{"id":"8fe1f439-8f3b-4367-b1e1-6b96216cd31e","block_type":"box","text":"than 3% of the total outstanding voting stock of such investment company and a Fund may not invest in another investment","page_number":513,"box":{"x":45,"y":738,"width":866,"height":12}},{"id":"cf03c2a1-8511-4afd-b156-5e9aead49b84","block_type":"box","text":"company if such investment would cause more than 5% of the value of the Fund’s total assets to be invested in securities of such","page_number":513,"box":{"x":45,"y":753,"width":891,"height":13}},{"id":"429b32c7-54f9-43e7-abc0-6f8b1dd154fc","block_type":"box","text":"investment company. (These limits do not restrict a feeder fund from investing all of its assets in shares of its master portfolio.) In","page_number":513,"box":{"x":45,"y":769,"width":896,"height":13}},{"id":"2f6486ed-1a30-4d46-8b10-e5acbc845e71","block_type":"box","text":"addition to the restrictions on investing in other investme","page_number":513,"box":{"x":46,"y":784,"width":395,"height":13}},{"id":"5112748c-5b5f-4bb7-b2c1-ab00a264cfd4","block_type":"box","text":"nt companies discussed above, under Section 12(d)(1)(C) of the","page_number":513,"box":{"x":442,"y":784,"width":438,"height":13}},{"id":"b296f6e5-b48a-4b9c-8f99-c3b296d0706b","block_type":"box","text":"Investment Company Act a Fund may not invest in a registered closed-end investment company if such investment would cause","page_number":513,"box":{"x":45,"y":800,"width":884,"height":13}},{"id":"a470b676-76b2-4a74-8b19-323adef3e342","block_type":"box","text":"the Fund and other BlackRock-advised investment companies to own more than 10% of the total outstanding voting stock of such","page_number":513,"box":{"x":45,"y":815,"width":909,"height":13}},{"id":"5a1a4031-6ecc-4eba-93de-810473c54b24","block_type":"box","text":"closed-end investment company. Pursuant to Section 12(d)(1","page_number":513,"box":{"x":45,"y":831,"width":420,"height":13}},{"id":"4a921cde-835e-48f3-a046-d58a4b9188df","block_type":"box","text":")(G) of the Investment Company Act, these percentage limitations do","page_number":513,"box":{"x":468,"y":831,"width":476,"height":13}},{"id":"23e6a0e6-f46d-4749-b403-3c3c9ca58359","block_type":"box","text":"not apply to investments in affiliated investment companies, in","page_number":513,"box":{"x":45,"y":846,"width":434,"height":13}},{"id":"db609159-adf5-4994-b1d5-15c5d8a4ba0c","block_type":"box","text":"cluding ETFs, subject to certain conditions. In addition, a Fund may","page_number":513,"box":{"x":479,"y":846,"width":473,"height":13}},{"id":"36a47fcd-75fb-44ec-af4c-d9799f836020","block_type":"box","text":"be able to rely on certain rules under the Investment Company Act to invest in shares of money market funds or other investment","page_number":513,"box":{"x":46,"y":862,"width":897,"height":13}},{"id":"fdc9275a-f476-4f91-a843-cf914c63f65c","block_type":"box","text":"companies beyond the statutory limits noted above, but subject to certain conditions.","page_number":513,"box":{"x":45,"y":877,"width":590,"height":13}},{"id":"47c4f1d2-0864-4e29-bbc4-a3eda665378e","block_type":"box","text":"II-3","page_number":513,"box":{"x":487,"y":917,"width":24,"height":9}},{"id":"225bafcc-3ea1-4973-bac5-c1fb945f6b2b","block_type":"box","text":"NM1026U-6004382-513/605","page_number":513,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"8739656c-ab3b-45fe-8d8d-d7638ca3ca2c","block_type":"box","text":"As with other investments, investments in other investment companies are subject to market and selection risk.","page_number":514,"box":{"x":45,"y":79,"width":767,"height":13}},{"id":"c1668730-67df-4c98-8647-de862a319373","block_type":"box","text":"Shares of investment companies, such as closed-end fund investment companies, that trade on an exchange may at times be","page_number":514,"box":{"x":46,"y":101,"width":854,"height":13}},{"id":"a21d1e17-f183-4d06-8740-89fdaa3598e0","block_type":"box","text":"acquired at market prices representing premiums to their NAVs. In","page_number":514,"box":{"x":46,"y":117,"width":464,"height":12}},{"id":"14a50434-b882-4948-a2a8-33a9f3faf9ed","block_type":"box","text":"addition, investment companies held by a Fund that trade on","page_number":514,"box":{"x":515,"y":117,"width":422,"height":12}},{"id":"badd196d-405b-4604-b161-698e2a5042d9","block_type":"box","text":"an exchange could trade at a discount from NAV, and such discount could increase while the Fund holds the shares. If the market","page_number":514,"box":{"x":46,"y":132,"width":901,"height":13}},{"id":"2ef48136-bf38-4779-bfba-bee3f3dd0e37","block_type":"box","text":"price of shares of an exchange-traded investment company decreases below the price that the Fund paid for the shares and the","page_number":514,"box":{"x":45,"y":148,"width":874,"height":12}},{"id":"ba474af3-14fb-48a7-912e-a9fedb62bc94","block_type":"box","text":"Fund were to sell its shares of such investment company at a time when the market price is lower than the price at which it","page_number":514,"box":{"x":45,"y":163,"width":852,"height":13}},{"id":"213fbf60-981d-4349-8f7c-398aba60c34b","block_type":"box","text":"purchased the shares, the Fund would experience a loss.","page_number":514,"box":{"x":45,"y":179,"width":387,"height":12}},{"id":"b165da83-7625-4159-82f2-c9bc22ebe0bd","block_type":"box","text":"In addition, if a Fund acquires shares in investment companies, in","page_number":514,"box":{"x":45,"y":201,"width":455,"height":13}},{"id":"c9cbd21d-7a5c-4d54-8ebe-e7eb3b4abfe3","block_type":"box","text":"cluding affiliated investment companies, shareholders would","page_number":514,"box":{"x":500,"y":201,"width":419,"height":13}},{"id":"5127c139-a5d8-48dc-8d4f-c4119e346cf3","block_type":"box","text":"bear both their proportionate share of expenses in the Fund and, indirectly, the expenses of such investment companies. Such","page_number":514,"box":{"x":46,"y":216,"width":867,"height":13}},{"id":"51ba3700-e0fc-4192-979b-5417c0c58cfc","block_type":"box","text":"expenses, both at the Fund level and acquired investment comp","page_number":514,"box":{"x":46,"y":232,"width":438,"height":13}},{"id":"59598c9e-038d-4a34-96c8-4671abac30e8","block_type":"box","text":"any level, would include management and advisory fees, unless","page_number":514,"box":{"x":485,"y":232,"width":435,"height":13}},{"id":"0e43ff4b-0c4f-4000-a939-52adafbfdca5","block_type":"box","text":"such fees have been waived by BlackRock. Please see the relevant Fund’s Prospectus to determine whether any such management","page_number":514,"box":{"x":46,"y":247,"width":892,"height":13}},{"id":"95af9d49-e781-421c-a828-9ec26b9cc7b0","block_type":"box","text":"and advisory fees have been waived by BlackRock. Investments by a Fund in wholly owned investment entities created under the","page_number":514,"box":{"x":46,"y":263,"width":892,"height":13}},{"id":"7c1e1191-1109-4100-af98-cafbcd495ca2","block_type":"box","text":"laws of certain countries will not be deemed an investment in other investment companies. Pursuant to guidance issued by the staff","page_number":514,"box":{"x":45,"y":278,"width":908,"height":13}},{"id":"a1865211-5de9-4310-88e9-1c24ada1130b","block_type":"box","text":"of the Commission, fees and expenses of money market funds used for the investment of cash collateral received in connection","page_number":514,"box":{"x":46,"y":294,"width":875,"height":13}},{"id":"6137a7ee-e6cf-4853-bf1f-161a6908530c","block_type":"box","text":"with loans of Fund securities are not treated as “acquired fund fees and expenses,” which are fees and expenses charged by other","page_number":514,"box":{"x":45,"y":309,"width":894,"height":13}},{"id":"67f6f833-2326-4a61-85b3-ad0c26d8b9e7","block_type":"box","text":"investment companies and pooled investment vehicles in which a Fund invests a portion of its assets.","page_number":514,"box":{"x":45,"y":325,"width":696,"height":13}},{"id":"d87e5c0b-2ab0-4e9e-ba9d-04f4ba43672f","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 may be limited. In","page_number":514,"box":{"x":45,"y":354,"width":887,"height":13}},{"id":"d9eeb260-6c0c-4475-a687-dcdc2d5bea49","block_type":"box","text":"addition, a fund-of-funds (","page_number":514,"box":{"x":46,"y":369,"width":183,"height":13}},{"id":"f79973d8-ee7f-4f2b-93ca-8d6038f2d937","block_type":"box","text":"e.g.","page_number":514,"box":{"x":230,"y":373,"width":22,"height":9}},{"id":"bc3d2ed8-c760-4a61-be8b-0da470b6015a","block_type":"box","text":", an investment company that seeks to meet its investment objective by investing significantly in","page_number":514,"box":{"x":255,"y":369,"width":660,"height":13}},{"id":"06e46658-93bc-4c41-ad12-dce6681b56ac","block_type":"box","text":"other investment companies) may be limited in its ability to purchase underlying funds if such underlying funds themselves own","page_number":514,"box":{"x":46,"y":385,"width":884,"height":13}},{"id":"44feff77-e87b-4bdc-b136-9cbb3fbf2fe8","block_type":"box","text":"shares of underlying funds.","page_number":514,"box":{"x":46,"y":400,"width":186,"height":13}},{"id":"a0e3bb0c-c685-4434-a6ae-3de77ff8d0df","block_type":"box","text":"A number of publicly traded closed-end investment companie","page_number":514,"box":{"x":45,"y":423,"width":427,"height":13}},{"id":"e574bede-63b0-4048-bef5-8ff0661841d1","block_type":"box","text":"s have been organized to facilitate indirect foreign investment in","page_number":514,"box":{"x":473,"y":423,"width":442,"height":13}},{"id":"eb7520ab-5489-46ee-8e05-594f9c8d3082","block_type":"box","text":"developing countries, and certain of such countries, such as Thailand,","page_number":514,"box":{"x":46,"y":438,"width":481,"height":13}},{"id":"6aec59ac-f12b-4571-aaf7-56dd4b9e3163","block_type":"box","text":"South Korea, Chile and Brazil, have specifically authorized","page_number":514,"box":{"x":532,"y":438,"width":407,"height":13}},{"id":"e902ff54-80f4-4a4f-821c-d3cccb4f508d","block_type":"box","text":"such funds. There also are investment opportunities in certai","page_number":514,"box":{"x":46,"y":454,"width":418,"height":13}},{"id":"d940acc4-ccac-4878-b551-7d952df31b11","block_type":"box","text":"n of such countries in pooled vehicles that resemble open-end","page_number":514,"box":{"x":464,"y":454,"width":425,"height":13}},{"id":"88b18285-0da7-49af-9a5b-fba72176c061","block_type":"box","text":"investment companies. The restrictions on investments in securities of investment companies set forth above may limit","page_number":514,"box":{"x":45,"y":469,"width":819,"height":13}},{"id":"b083785d-200f-4f9f-9f70-fb8a39bf8755","block_type":"box","text":"opportunities for a Fund to invest indirectly in certain developing countries.","page_number":514,"box":{"x":46,"y":485,"width":523,"height":13}},{"id":"6d0acc85-47fe-4572-8038-e451f3ac795b","block_type":"box","text":"Issuer Insolvency Risk.","page_number":514,"box":{"x":45,"y":507,"width":158,"height":13}},{"id":"e62fac1c-3b48-4d76-8800-7ca037d63d24","block_type":"box","text":"Certain Funds’ potential exposure to financially or operationally troubled issuers involves a high degree of","page_number":514,"box":{"x":210,"y":507,"width":736,"height":13}},{"id":"d0a28ad2-474f-4e57-b190-72a0315d08be","block_type":"box","text":"credit and market risk, which may be heightened during an economic downturn or recession. Should an issuer of securities held by","page_number":514,"box":{"x":45,"y":523,"width":906,"height":12}},{"id":"40c67500-5fbf-444e-90a8-c47634f2c5e3","block_type":"box","text":"a Fund become involved in a bankruptcy proceeding, reorganizatio","page_number":514,"box":{"x":46,"y":538,"width":464,"height":13}},{"id":"9e22bfb4-7587-48f0-93dc-78f0ef65497d","block_type":"box","text":"n or financial restructuring, a wide variety of considerations","page_number":514,"box":{"x":511,"y":538,"width":415,"height":13}},{"id":"bc8f43b1-b777-410b-a74b-239a3b8f32d6","block_type":"box","text":"make an evaluation of the outcome of the Fund’s exposure to the issuer uncertain.","page_number":514,"box":{"x":45,"y":554,"width":569,"height":12}},{"id":"f907d188-1a66-487e-8380-390b538b9ee5","block_type":"box","text":"During the period of a bankruptcy proceeding, reorganization or","page_number":514,"box":{"x":45,"y":576,"width":450,"height":13}},{"id":"4e734552-8231-4c49-a378-052101af1cc9","block_type":"box","text":"financial restructuring, it is unlikely that a Fund will receive any","page_number":514,"box":{"x":500,"y":576,"width":442,"height":13}},{"id":"b62210f9-1a50-459c-af17-f75eb02040ac","block_type":"box","text":"interest payments on the securities of the issuer. A Fund will be subject","page_number":514,"box":{"x":45,"y":591,"width":490,"height":13}},{"id":"f532990e-aac1-4deb-96ee-8317794126e0","block_type":"box","text":"to significant uncertainty as to whether the reorganization","page_number":514,"box":{"x":540,"y":591,"width":402,"height":13}},{"id":"51def9c2-5fcc-43f1-963f-3440b659383e","block_type":"box","text":"or restructuring will be completed, and the Fund may bear certain extraordinary expenses to protect and recover its investment. A","page_number":514,"box":{"x":46,"y":607,"width":901,"height":13}},{"id":"559f699a-0b96-4984-adfa-b8436ac3f0f8","block_type":"box","text":"Fund will also be subject to significant uncertainty as to when and in what manner and for what value the obligations evidenced","page_number":514,"box":{"x":45,"y":622,"width":889,"height":13}},{"id":"32c9eecf-fef0-40e1-b315-50de8239ebe8","block_type":"box","text":"by the securities of the issuer held by the Fund will eventually be satisfied.","page_number":514,"box":{"x":46,"y":638,"width":509,"height":13}},{"id":"08671594-6c75-40ab-99fc-b192decd8002","block_type":"box","text":"Even if a plan of reorganization or restructuring is adopted with","page_number":514,"box":{"x":45,"y":660,"width":445,"height":13}},{"id":"e7c900fa-cf18-49f0-babb-3779a49f02e1","block_type":"box","text":"respect to the securities of the issuer held by the Fund, there can","page_number":514,"box":{"x":495,"y":660,"width":441,"height":13}},{"id":"05338e50-505b-4d84-b719-b16e6f988abe","block_type":"box","text":"be no assurance that the securities or other assets received by a Fund in connection with such plan of reorganization or","page_number":514,"box":{"x":46,"y":676,"width":822,"height":12}},{"id":"44a5dddc-0b8a-4cc0-b17d-1020acb192a3","block_type":"box","text":"restructuring will not have a lower value or income potential than may have been anticipated or no value. A Fund may be unable","page_number":514,"box":{"x":45,"y":691,"width":896,"height":13}},{"id":"88f4a338-5f44-4185-9825-e529f61ef834","block_type":"box","text":"to enforce its claims or rights in any collateral or may have its clai","page_number":514,"box":{"x":45,"y":707,"width":456,"height":12}},{"id":"cb128410-7eb2-473d-b45c-96e5d3eaab98","block_type":"box","text":"ms or security interest in any collateral challenged, disallowed or","page_number":514,"box":{"x":502,"y":707,"width":448,"height":12}},{"id":"368f72bd-2d6d-4ba9-a315-8cb25a5d117f","block_type":"box","text":"subordinated to the claims or security interests of other creditors. In addition, amendments to the U.S. Bankruptcy Code or other","page_number":514,"box":{"x":46,"y":722,"width":894,"height":13}},{"id":"13bf9aed-303c-4973-9e11-efa3212b6f3d","block_type":"box","text":"relevant laws could alter the expected outcome or introduce greate","page_number":514,"box":{"x":45,"y":738,"width":462,"height":12}},{"id":"3729a006-de5c-4f46-9b98-015d8dcab5b8","block_type":"box","text":"r uncertainty regarding the outcome of the Fund’s securities","page_number":514,"box":{"x":507,"y":738,"width":413,"height":12}},{"id":"afd06b56-944d-440e-8bbd-4b8bd1db5843","block_type":"box","text":"holdings in the issuer. In a bankruptcy proceeding, a reorganization or restructuring, the securities of the issuer held by a Fund","page_number":514,"box":{"x":45,"y":753,"width":876,"height":13}},{"id":"0b10e1c3-45d8-438e-8f61-76e1872cef47","block_type":"box","text":"could be re-characterized or a Fund may receive different securities or other assets, including equity securities. These types of","page_number":514,"box":{"x":45,"y":769,"width":864,"height":13}},{"id":"4442ab69-6ad3-4cb4-9a76-c70813dae378","block_type":"box","text":"equity securities include, but are not limited to: common stock; preferred stock (including convertible preferred stock); bonds,","page_number":514,"box":{"x":46,"y":784,"width":870,"height":13}},{"id":"994c9610-1738-43c8-96f2-24d249c05899","block_type":"box","text":"notes and debentures convertible into common or preferred stock; st","page_number":514,"box":{"x":45,"y":800,"width":475,"height":13}},{"id":"34675047-07c1-4ae6-9c61-3efc20f16a8b","block_type":"box","text":"ock purchase warrants and rights; equity interests in trusts;","page_number":514,"box":{"x":520,"y":800,"width":409,"height":13}},{"id":"b709557a-293b-4428-a86a-84a82f7632f0","block_type":"box","text":"and depositary receipts. Equity securities are subject to changes in value, and their value may be more volatile than those of other","page_number":514,"box":{"x":46,"y":815,"width":895,"height":13}},{"id":"1b330413-45e0-44c5-8ced-8d5db4e3e6cb","block_type":"box","text":"asset classes. Holders of equity securities are subject to more risk than holders of debt securities because the status of equity","page_number":514,"box":{"x":46,"y":831,"width":854,"height":13}},{"id":"d8ae0a5f-ce82-4929-802f-42933ebb0579","block_type":"box","text":"holders is subordinate to debtholders in an issuer’s capital structure. The value of equity securities received by a Fund could decline","page_number":514,"box":{"x":45,"y":846,"width":908,"height":13}},{"id":"7908e87e-fbcc-42db-b4a3-5390499d7612","block_type":"box","text":"if the financial condition of the issuer deteriorates or if overa","page_number":514,"box":{"x":45,"y":862,"width":420,"height":10}},{"id":"417e85e4-85a4-47bc-9331-602261c7c72f","block_type":"box","text":"ll market and economic conditions, or conditions within the issuer’s","page_number":514,"box":{"x":466,"y":862,"width":470,"height":12}},{"id":"d950a0af-e26e-4257-9fba-2022b75e8086","block_type":"box","text":"region or industry, deteriorate.","page_number":514,"box":{"x":45,"y":877,"width":212,"height":13}},{"id":"a9dc5512-8974-4c5e-8a40-21a104539c49","block_type":"box","text":"II-4","page_number":514,"box":{"x":487,"y":917,"width":25,"height":9}},{"id":"0c912d9f-82d4-4f05-9f64-43e75a712bc1","block_type":"box","text":"NM1026U-6004382-514/605","page_number":514,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"67e82968-4ab2-4898-b1d7-877265253332","block_type":"box","text":"To the extent that a Fund receives other assets in connection","page_number":515,"box":{"x":45,"y":79,"width":419,"height":10}},{"id":"b7d0c164-0ba0-4691-8df2-12d7f5c05570","block_type":"box","text":"with a bankruptcy proceeding, reorganization or financial","page_number":515,"box":{"x":468,"y":79,"width":402,"height":13}},{"id":"eee1e637-5238-4147-94da-017f08171722","block_type":"box","text":"restructuring, the Fund may also be subject to additional risks associated with the assets received. 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A Fund may receive such interests in loans to the extent permitted by the Investment","page_number":515,"box":{"x":45,"y":125,"width":853,"height":13}},{"id":"786285ea-3ce6-465b-a3b9-8b903dde8682","block_type":"box","text":"Company Act.","page_number":515,"box":{"x":46,"y":141,"width":100,"height":13}},{"id":"8b99ed25-aa54-44a0-a779-e41301463d55","block_type":"box","text":"Securities or other assets received in a reorganization or restructur","page_number":515,"box":{"x":46,"y":162,"width":456,"height":13}},{"id":"6f60a51b-c691-4e46-be4e-906e020f03c8","block_type":"box","text":"ing typically entail a higher degree of risk than investments in","page_number":515,"box":{"x":503,"y":162,"width":425,"height":13}},{"id":"fff953e1-a281-4e2b-8ca5-5e8f3e90159c","block_type":"box","text":"securities of issuers that have not undergone a reorganization or restructuring and may be subject to heavy selling or downward","page_number":515,"box":{"x":46,"y":178,"width":885,"height":12}},{"id":"fa5f1300-2adc-47cf-a268-d207bf0d4686","block_type":"box","text":"pricing pressure after completion of the reorganization or restruct","page_number":515,"box":{"x":45,"y":193,"width":455,"height":13}},{"id":"510d1f67-c563-44aa-9205-c2831567584a","block_type":"box","text":"uring. The post-reorganization/restructuring assets and securities","page_number":515,"box":{"x":501,"y":193,"width":447,"height":13}},{"id":"1f2aa457-85b7-40e9-9f91-191dd70c93ca","block_type":"box","text":"may also be illiquid and difficult to sell or value. If a Fund participates in negotiations with respect to a plan of reorganization or","page_number":515,"box":{"x":45,"y":209,"width":892,"height":12}},{"id":"e0dcc2a9-29d0-46de-9c5d-3587e7ea0c7d","block_type":"box","text":"restructuring with respect to securities of the issuer held by a Fund, the Fund also may be restricted from disposing such securities","page_number":515,"box":{"x":45,"y":224,"width":897,"height":13}},{"id":"c2440555-b2e9-4431-9cb3-dcfdc9c7322e","block_type":"box","text":"for a period of time. If a Fund becomes involved in such proceedings, the Fund may have more active participation in the affairs of","page_number":515,"box":{"x":45,"y":240,"width":906,"height":12}},{"id":"28a7a662-9adb-4220-be9e-fdcdc1a25888","block_type":"box","text":"the issuer than that assumed generally by an investor.","page_number":515,"box":{"x":45,"y":255,"width":370,"height":13}},{"id":"88c55db1-3e64-4c80-bbce-b8bf536cb991","block_type":"box","text":"Market Risks/Recent Market Events.","page_number":515,"box":{"x":44,"y":276,"width":257,"height":11}},{"id":"68fa79c0-97ad-4552-8e68-a1b19f1b4e89","block_type":"box","text":"Securities may decline in value due to factors affecting securities markets generally or","page_number":515,"box":{"x":307,"y":276,"width":588,"height":13}},{"id":"05f9580f-b31d-4e3e-a4a2-696b7cc4e973","block_type":"box","text":"particular industries represented in the markets. The value of a security may decline due to general market conditions, economic","page_number":515,"box":{"x":45,"y":292,"width":888,"height":13}},{"id":"706a7692-43c4-465c-a017-14809fbbe1f6","block_type":"box","text":"trends or events that are not specifically related to a company or to factors that affect a particular industry or industries, or factors","page_number":515,"box":{"x":45,"y":307,"width":904,"height":13}},{"id":"2a34c05e-4bbd-4dda-a491-ce0f55e093b3","block_type":"box","text":"that affect a particular issuer or issuers, exchange, country, gr","page_number":515,"box":{"x":45,"y":323,"width":427,"height":13}},{"id":"e2c9cb5e-cca2-4a77-b158-6e2c1919d40a","block_type":"box","text":"oup of countries, region, market, industry, group of industries, sector","page_number":515,"box":{"x":473,"y":323,"width":479,"height":13}},{"id":"ccac5155-b3a3-403d-a276-9aff98d22ec6","block_type":"box","text":"or asset class. The success of a Fund’s activities could be affected by interest rates, availability of credit, inflation rates, economic","page_number":515,"box":{"x":46,"y":338,"width":888,"height":13}},{"id":"869ddcc5-e49a-45cf-9841-bbdbc6a9b446","block_type":"box","text":"uncertainty, changes in laws, trade barriers, economic sanctions, cu","page_number":515,"box":{"x":46,"y":354,"width":466,"height":13}},{"id":"d3fb0949-78fc-440b-ba14-65ed2cdf9590","block_type":"box","text":"rrency exchange controls, and local, regional or global events","page_number":515,"box":{"x":513,"y":354,"width":424,"height":13}},{"id":"66f07bac-7ee0-4fc3-90fc-32258d022115","block_type":"box","text":"such as war, acts of terrorism, natural and environmental disas","page_number":515,"box":{"x":46,"y":369,"width":435,"height":13}},{"id":"84e18312-ece3-4310-aaf8-bae1aa7de6da","block_type":"box","text":"ters, the spread of infectious illness or other public health issues,","page_number":515,"box":{"x":482,"y":369,"width":444,"height":13}},{"id":"6ce5355d-6254-4b68-8232-2a7a734f15d4","block_type":"box","text":"recessions, or other events could have a significant impact on a Fund","page_number":515,"box":{"x":45,"y":385,"width":476,"height":13}},{"id":"a2946563-1b09-4944-a66b-f7f2ffbe6fa5","block_type":"box","text":"and its investments. During a general economic downturn in","page_number":515,"box":{"x":526,"y":385,"width":419,"height":13}},{"id":"2636f56f-9a6c-483d-8f78-dccd8fddc879","block_type":"box","text":"the securities markets, multiple asset classes may be negativel","page_number":515,"box":{"x":45,"y":400,"width":423,"height":13}},{"id":"fb583b30-2b77-4c0b-bb9c-76b86630809f","block_type":"box","text":"y affected. These factors may affect the level and volatility of","page_number":515,"box":{"x":468,"y":400,"width":422,"height":13}},{"id":"e2f7999f-c152-45a4-ae28-55973453f6d4","block_type":"box","text":"securities prices and the liquidity of a Fund’s investments, which could impair a Fund’s profitability or result in losses. 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Fu","page_number":515,"box":{"x":45,"y":707,"width":457,"height":12}},{"id":"2be59b8e-1d25-449c-b100-3745089b8954","block_type":"box","text":"ture legislation or regulation or other governmental actions","page_number":515,"box":{"x":503,"y":707,"width":409,"height":12}},{"id":"4e097460-1af3-4579-87fa-ae3928b27a2e","block_type":"box","text":"could limit or preclude a Fund’s abilities to achieve its investment objectives or otherwise adversely impact an investment in a","page_number":515,"box":{"x":45,"y":722,"width":868,"height":13}},{"id":"538554d9-a27c-420a-9451-dd1381718f18","block_type":"box","text":"Fund. 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A downgrade of the ratings of","page_number":515,"box":{"x":508,"y":877,"width":427,"height":13}},{"id":"6eddebc1-087b-4d9e-8a11-c1979daa926f","block_type":"box","text":"II-5","page_number":515,"box":{"x":487,"y":917,"width":24,"height":9}},{"id":"85603228-1fab-45e1-a007-9e2006d4cebc","block_type":"box","text":"NM1026U-6004382-515/605","page_number":515,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b125c037-80ae-4ee2-8b9d-e3c76946a577","block_type":"box","text":"U.S. Government debt obligations, or concerns about the U.S. Government’s credit quality in general, could have a substantial","page_number":516,"box":{"x":45,"y":79,"width":876,"height":13}},{"id":"7ab385bd-fc24-4d62-932d-bb9e5bb367f7","block_type":"box","text":"negative effect on the U.S. and global economies. 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Global trade disruption, significant introductions of trade barriers, and bilateral trade frictions, together with","page_number":516,"box":{"x":46,"y":558,"width":894,"height":12}},{"id":"d6b03fef-c27e-46be-b3c2-d8009883a61e","block_type":"box","text":"any future downturns in the global economy resulting therefrom,","page_number":516,"box":{"x":46,"y":573,"width":450,"height":13}},{"id":"da55a734-9170-447d-843a-01623d77c929","block_type":"box","text":"could adversely affect the financial performance of a Fund and","page_number":516,"box":{"x":502,"y":573,"width":433,"height":13}},{"id":"334ec4df-0499-450d-9b17-730fbf99d558","block_type":"box","text":"its investments. Trade policy may be an ongoing source of instab","page_number":516,"box":{"x":45,"y":589,"width":449,"height":12}},{"id":"0c20b154-b73c-46ce-8069-08344665eecc","block_type":"box","text":"ility, potentially resulting in significant currency fluctuations and/","page_number":516,"box":{"x":495,"y":589,"width":453,"height":12}},{"id":"b40a3e4b-d6c7-4c2b-a6c4-f4bb1eb41bf2","block_type":"box","text":"or having other adverse effects on international markets, intern","page_number":516,"box":{"x":46,"y":604,"width":436,"height":13}},{"id":"0435dedc-7a2c-424b-97ea-c08910d805cb","block_type":"box","text":"ational trade agreements, and/or other existing cross-border","page_number":516,"box":{"x":483,"y":604,"width":415,"height":13}},{"id":"e71b80a9-0f26-4ad2-94cc-a2076c86eaf7","block_type":"box","text":"cooperation arrangements (whether economic, tax, fiscal, legal,","page_number":516,"box":{"x":45,"y":620,"width":439,"height":12}},{"id":"a680bafb-32c4-42c2-8dc2-24e0815ae60b","block_type":"box","text":"regulatory, or otherwise). To the extent trade disputes escalate","page_number":516,"box":{"x":489,"y":620,"width":433,"height":12}},{"id":"78d6bb51-a314-4d50-9dbc-fae2cffae704","block_type":"box","text":"globally, there could be additional significant impacts on the sectors or industries in which a Fund invests and other adverse","page_number":516,"box":{"x":45,"y":635,"width":858,"height":13}},{"id":"bec9895f-54d7-40ab-8d7d-f3f18da50b2d","block_type":"box","text":"impacts on a Fund’s overall performance.","page_number":516,"box":{"x":45,"y":651,"width":287,"height":12}},{"id":"1cb13e24-a624-4b7c-9a8d-e66727aee114","block_type":"box","text":"Municipal Investments","page_number":516,"box":{"x":45,"y":686,"width":183,"height":14}},{"id":"ea7c1353-8885-4c68-8842-fee92c0d2b2d","block_type":"box","text":"Municipal Securities","page_number":516,"box":{"x":45,"y":712,"width":140,"height":13}},{"id":"6c2ba60e-9537-49ba-b8f6-e3225f6b63d5","block_type":"box","text":". Certain Funds invest in short term municipal obligations issued by or on behalf of the states, their political","page_number":516,"box":{"x":187,"y":712,"width":745,"height":13}},{"id":"1679f589-92b0-43d6-8c14-d2a477e6b124","block_type":"box","text":"subdivisions, agencies and instrumentalities and obligations of other qualifying issuers, such as issuers located in Puerto Rico, the","page_number":516,"box":{"x":46,"y":728,"width":893,"height":13}},{"id":"35a156d7-07d4-4061-adc3-5a4ec83996d9","block_type":"box","text":"U.S. Virgin Islands and Guam, the interest on which (and/or, in the case of property taxes, the value of which) is excludable, in the","page_number":516,"box":{"x":45,"y":743,"width":905,"height":13}},{"id":"075929aa-17ae-4e9d-b5a5-9d2bcc30cbc8","block_type":"box","text":"opinion of bond counsel to the issuer, from gross income for purposes of Federal income taxes and the applicable state’s income","page_number":516,"box":{"x":46,"y":759,"width":887,"height":13}},{"id":"3503da36-10a9-4110-bb5e-fc9882b0a42a","block_type":"box","text":"taxes (“State Taxes”). Obligations that pay interest that is ex","page_number":516,"box":{"x":45,"y":774,"width":423,"height":13}},{"id":"a06ac955-1aa2-4860-a94b-39f3a2c406d5","block_type":"box","text":"cludable from gross income for Federal income tax purposes are","page_number":516,"box":{"x":468,"y":774,"width":445,"height":13}},{"id":"1d0167ac-a6a7-43f6-87bd-e5dd16dbe470","block_type":"box","text":"referred to herein as “Municipal Securities,” and obligations that","page_number":516,"box":{"x":45,"y":790,"width":451,"height":13}},{"id":"bf5a60fe-997b-475b-8971-3287fe9008e9","block_type":"box","text":"pay interest that is excludable from gross income for Federal","page_number":516,"box":{"x":501,"y":790,"width":419,"height":13}},{"id":"a01e9ce5-e6d6-44c6-9e04-ebc5a42491d6","block_type":"box","text":"income tax purposes and are exempt from the applicable State Taxes are referred to as “State Municipal Securities.” Unless","page_number":516,"box":{"x":45,"y":805,"width":856,"height":13}},{"id":"bb94df72-8b73-4ac8-97a5-4ceb1e676b2c","block_type":"box","text":"otherwise indicated, references to Municipal Securities shall be deemed to include State Municipal Securities.","page_number":516,"box":{"x":46,"y":821,"width":751,"height":13}},{"id":"48629d33-432b-487d-a45c-5343976a2b25","block_type":"box","text":"Municipal Securities include debt obligations issued to obtai","page_number":516,"box":{"x":45,"y":846,"width":417,"height":13}},{"id":"86bcffdd-3f72-4fef-9bcc-e5ce6544b149","block_type":"box","text":"n funds for various public purposes, including construction of a wide","page_number":516,"box":{"x":462,"y":846,"width":479,"height":13}},{"id":"5a940881-2bb7-46c5-bbe9-5a9d5965c319","block_type":"box","text":"range of public facilities, refunding of outstanding obligations an","page_number":516,"box":{"x":45,"y":862,"width":450,"height":12}},{"id":"8f1ac2a5-9806-4fa9-b894-8c34c4879e5f","block_type":"box","text":"d obtaining funds for general operating expenses and loans to","page_number":516,"box":{"x":495,"y":862,"width":427,"height":12}},{"id":"e42268f8-f809-4860-bb8d-ef01cf9770cc","block_type":"box","text":"other public institutions and facilities. In addition, certain types of bonds are issued by or on behalf of public authorities to finance","page_number":516,"box":{"x":46,"y":877,"width":904,"height":13}},{"id":"df3d77a6-71dc-417a-86ef-d591172c3d04","block_type":"box","text":"II-6","page_number":516,"box":{"x":487,"y":917,"width":25,"height":9}},{"id":"65337d36-b1cd-4758-9a0b-fb47769f02cc","block_type":"box","text":"NM1026U-6004382-516/605","page_number":516,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"e84e9246-b330-455e-bafd-835e28f3b6c8","block_type":"box","text":"various facilities operated for private profit. Such obligations are included within the term Municipal Securities if the interest paid","page_number":517,"box":{"x":45,"y":79,"width":898,"height":13}},{"id":"31927a2f-ca6e-4382-94ad-310c8018f479","block_type":"box","text":"thereon is excludable from gross income for Federal income tax purposes.","page_number":517,"box":{"x":45,"y":94,"width":511,"height":13}},{"id":"39c76d20-60a0-4fa4-8171-34ae0ac3686b","block_type":"box","text":"The two principal classifications of Municipal Securities are “general obligation” bonds and “revenue” or “special obligation”","page_number":517,"box":{"x":45,"y":118,"width":877,"height":12}},{"id":"60628c3c-9389-448b-8726-cfdbb470e531","block_type":"box","text":"bonds. General obligation bonds are secured by the issuer’s pledg","page_number":517,"box":{"x":46,"y":133,"width":452,"height":13}},{"id":"f1195b33-776e-4f3c-8f49-f819865a20ea","block_type":"box","text":"e of its faith, credit and taxing power for the repayment of","page_number":517,"box":{"x":499,"y":133,"width":405,"height":13}},{"id":"8033bd8c-e8be-4e8a-bc37-3fb1b962f990","block_type":"box","text":"principal and the payment of interest. Revenue or special obligation bonds are payable only from the revenues derived from a","page_number":517,"box":{"x":45,"y":149,"width":870,"height":12}},{"id":"504de1f0-9939-4e9a-a732-8f70248e7fbb","block_type":"box","text":"particular facility or class of facilities or, in some cases, from the proceeds of a special excise tax or other specific revenue source","page_number":517,"box":{"x":45,"y":164,"width":887,"height":13}},{"id":"83847523-7308-4f3b-899f-efa6c3c066dd","block_type":"box","text":"such as from the user of the facility being financed. Private activity bonds (or “industrial development bonds” under pre-1986 law)","page_number":517,"box":{"x":46,"y":180,"width":907,"height":12}},{"id":"ff4e19e1-fd4b-42c6-8934-83954414da24","block_type":"box","text":"are in most cases revenue bonds and do not generally constitute the pledge of the credit or taxing power of the issuer of such","page_number":517,"box":{"x":46,"y":195,"width":863,"height":13}},{"id":"a4fc332b-504f-4e1a-8bad-be15faff61c7","block_type":"box","text":"bonds. The repayment of the principal and the payment of interest on such private activity bonds depends solely on the ability of","page_number":517,"box":{"x":46,"y":211,"width":893,"height":12}},{"id":"f2030fd6-c7f4-4b9a-b43c-a3cc95dc7ee3","block_type":"box","text":"the user of the facilities financed by the bonds to meet its financial ob","page_number":517,"box":{"x":45,"y":226,"width":480,"height":13}},{"id":"0d21d0ff-5e09-444e-8695-65ef6a702061","block_type":"box","text":"ligation and the pledge, if any, of real and personal property","page_number":517,"box":{"x":526,"y":226,"width":417,"height":13}},{"id":"1703c3bc-a7e9-4bee-9653-2c12e9976452","block_type":"box","text":"so financed as security for such payment. In addition, private activity bonds may pay interest that is subject to the Federal","page_number":517,"box":{"x":46,"y":242,"width":842,"height":12}},{"id":"ce51c26c-b969-43b6-bae3-cca24e9eb9a1","block_type":"box","text":"alternative minimum tax. A Fund’s portfolio may include “moral","page_number":517,"box":{"x":46,"y":257,"width":452,"height":13}},{"id":"3e686238-1ded-4911-8cf3-22ac1226b04a","block_type":"box","text":"obligation” bonds, which are normally issued by special purpose","page_number":517,"box":{"x":503,"y":257,"width":448,"height":13}},{"id":"59d49e38-9e72-4777-96e9-d28913ca5b5e","block_type":"box","text":"public authorities. If an issuer of moral obligation bonds is unable to meet its debt service obligations from current revenues, it","page_number":517,"box":{"x":45,"y":273,"width":877,"height":12}},{"id":"a4375463-7444-490e-bfa8-26ba4bc5475d","block_type":"box","text":"may draw on a reserve fund, the restoration of which is a moral commitment but not a legal obligation of a state or municipality.","page_number":517,"box":{"x":45,"y":288,"width":897,"height":13}},{"id":"92fc9f5e-8fb2-49b5-a870-cf6ff1277b3d","block_type":"box","text":"Yields on Municipal Securities are dependent on a variety of fa","page_number":517,"box":{"x":45,"y":311,"width":436,"height":13}},{"id":"47c99d9f-924c-4de8-854b-b74881f2c39b","block_type":"box","text":"ctors, including the general condition of the money market and of","page_number":517,"box":{"x":481,"y":311,"width":457,"height":13}},{"id":"cd75a46c-8b4a-48b0-ba4e-a9fd17c6c2a4","block_type":"box","text":"the municipal bond market, the size of a particular offering, the maturity of the obligation, and the rating of the issuer. The ability","page_number":517,"box":{"x":45,"y":327,"width":903,"height":13}},{"id":"bf56380a-7769-4040-8463-04dc96cc6ecb","block_type":"box","text":"of a Fund to achieve its investment objective is also dependent on the continuing ability of the issuers of the Municipal Securities in","page_number":517,"box":{"x":46,"y":342,"width":906,"height":13}},{"id":"91042011-e4cb-48d7-869b-d765407fee97","block_type":"box","text":"which the Fund invests to meet their obligations for the paym","page_number":517,"box":{"x":45,"y":358,"width":427,"height":13}},{"id":"a58ee57d-7848-429c-9994-14963d92d5af","block_type":"box","text":"ent of interest and the repayment of principal when due. There are","page_number":517,"box":{"x":473,"y":358,"width":460,"height":13}},{"id":"89d1afe8-a112-491b-997c-88aa2d6a3f5f","block_type":"box","text":"variations in the risks involved in holding Municipal Securities, both within a particular classification and between classifications,","page_number":517,"box":{"x":45,"y":373,"width":897,"height":13}},{"id":"87855a6a-d51f-474f-9883-b56f6566ca6e","block_type":"box","text":"depending on numerous factors. Furthermore, the rights of hold","page_number":517,"box":{"x":46,"y":389,"width":443,"height":13}},{"id":"a9d4b1b5-4cc3-445a-8f59-0fcaa653ce49","block_type":"box","text":"ers of Municipal Securities and the obligations of the issuers of","page_number":517,"box":{"x":490,"y":389,"width":435,"height":13}},{"id":"94732587-74b8-465a-be76-0936494f8e58","block_type":"box","text":"such Municipal Securities may be subject to applicable bankruptcy","page_number":517,"box":{"x":46,"y":404,"width":461,"height":13}},{"id":"19de65e5-b240-4de3-a4c2-079e180e36b5","block_type":"box","text":", insolvency and similar laws and court decisions affecting the","page_number":517,"box":{"x":508,"y":404,"width":427,"height":13}},{"id":"4d960870-8af4-4cca-b377-0806052a6371","block_type":"box","text":"rights of creditors generally, and such laws, if any, which may be ena","page_number":517,"box":{"x":45,"y":420,"width":479,"height":13}},{"id":"62efc9f7-017c-42c3-ba27-6961d0ac7458","block_type":"box","text":"cted by Congress or state legislatures affecting specifically the","page_number":517,"box":{"x":524,"y":420,"width":425,"height":13}},{"id":"12cf0624-2881-47f8-bd1d-77ba4f86d990","block_type":"box","text":"rights of holders of Municipal Securities.","page_number":517,"box":{"x":45,"y":435,"width":281,"height":13}},{"id":"b057f401-aacd-41bf-b273-5d53ddc599f5","block_type":"box","text":"A Fund’s ability to distribute dividends exempt from Federal income tax will depend on the exclusion from gross income of the","page_number":517,"box":{"x":45,"y":459,"width":882,"height":12}},{"id":"babd3206-3f5b-4387-b884-f2e036de7033","block_type":"box","text":"interest income that it receives on the Municipal Securities in which it invests. A Fund will only purchase a Municipal Security if it","page_number":517,"box":{"x":45,"y":474,"width":902,"height":13}},{"id":"87d3eb45-6e8f-406c-98ea-deedcec0df73","block_type":"box","text":"is accompanied by an opinion of counsel to the issuer, which is delivered on the date of issuance of that security, that interest on","page_number":517,"box":{"x":45,"y":490,"width":889,"height":12}},{"id":"758945fb-d573-4bba-8322-83568c768e14","block_type":"box","text":"such securities is excludable from gross income for Federal income tax purposes (the “tax exemption opinion”).","page_number":517,"box":{"x":46,"y":505,"width":774,"height":13}},{"id":"1ff631b6-4ec5-4a43-9f5e-4e9479ce28b3","block_type":"box","text":"Events occurring after the date of issuance of the Municipal Securities, however, may cause the interest on such securities to be","page_number":517,"box":{"x":45,"y":528,"width":877,"height":13}},{"id":"eece2baf-6d99-4235-86b1-ab2794aeee16","block_type":"box","text":"includable in gross income for Federal income tax purposes. For example, the Internal Revenue Code of 1986, as amended (the","page_number":517,"box":{"x":45,"y":544,"width":882,"height":13}},{"id":"8f5be0ec-b80a-4436-94f0-6b5628461340","block_type":"box","text":"“Code”) establishes certain requirements, such as restrictions as","page_number":517,"box":{"x":47,"y":559,"width":440,"height":13}},{"id":"414e7e43-699d-417c-982a-568635c4b0cc","block_type":"box","text":"to the investment of the proceeds of the issue, limitations as to the","page_number":517,"box":{"x":492,"y":559,"width":458,"height":13}},{"id":"28d17852-2e9a-4d6b-874e-73a10c93b18e","block_type":"box","text":"use of proceeds of such issue and the property financed by such","page_number":517,"box":{"x":46,"y":575,"width":438,"height":13}},{"id":"b166ae7e-0e5c-4484-9c9f-d416f80f40c1","block_type":"box","text":"proceeds, and the payment of certain excess earnings to the","page_number":517,"box":{"x":489,"y":575,"width":411,"height":13}},{"id":"d042cd66-3e66-4380-aaee-5d0d7e3bc075","block_type":"box","text":"Federal government, that must be met after the issuance of the Municipal Securities for interest on such securities to remain","page_number":517,"box":{"x":45,"y":590,"width":855,"height":13}},{"id":"171d7c19-5692-4829-aca4-710e3a11ff55","block_type":"box","text":"excludable from gross income for Federal income tax purposes. The issuers and the conduit borrowers of the Municipal Securities","page_number":517,"box":{"x":46,"y":606,"width":900,"height":13}},{"id":"a36c56e7-4fef-4e6d-82d9-47e3653332f2","block_type":"box","text":"generally covenant to comply with such requirements and the tax e","page_number":517,"box":{"x":45,"y":621,"width":465,"height":13}},{"id":"ea872f47-8be6-42a9-b722-3e4e0f8f8070","block_type":"box","text":"xemption opinion generally assumes continuing compliance","page_number":517,"box":{"x":510,"y":621,"width":414,"height":13}},{"id":"03a4c359-e3b0-4f04-937d-d5d1fd59dc2b","block_type":"box","text":"with such requirements. Failure to comply with these continuing re","page_number":517,"box":{"x":45,"y":637,"width":465,"height":13}},{"id":"2ace37f2-3825-4b8f-b311-4b9aa70b6c2c","block_type":"box","text":"quirements, however, may cause the interest on such Municipal","page_number":517,"box":{"x":511,"y":637,"width":440,"height":13}},{"id":"98ffc2d4-05dd-4b94-9a1b-49d4365b1b86","block_type":"box","text":"Securities to be includable in gross income for Federal income tax purposes retroactive to their date of issue.","page_number":517,"box":{"x":46,"y":652,"width":747,"height":13}},{"id":"34171a39-df6a-40e5-bbfc-6b6176db93d2","block_type":"box","text":"In addition, the Internal Revenue Service (“IRS”) has an ongoing enforcement program that involves the audit of tax exempt","page_number":517,"box":{"x":45,"y":676,"width":865,"height":12}},{"id":"bc656daf-90c3-476e-bffd-8ce5d03ba2bd","block_type":"box","text":"bonds to determine whether an issue of bonds satisfies all of the requirements that must be met for interest on such bonds to be","page_number":517,"box":{"x":46,"y":691,"width":882,"height":13}},{"id":"b2a2848e-7289-4dc8-85fe-8d07797a092c","block_type":"box","text":"excludable from gross income for Federal income tax purposes.","page_number":517,"box":{"x":46,"y":707,"width":438,"height":12}},{"id":"dc5e54a2-6bd1-44c4-a7b4-018f7a4ebe15","block_type":"box","text":"From time to time, some of the Municipal Securities held by a","page_number":517,"box":{"x":490,"y":707,"width":428,"height":12}},{"id":"0c9cd1cf-f69d-48cd-8cb9-8f039f87f831","block_type":"box","text":"Fund may be the subject of such an audit by the IRS, and the IRS may determine that the interest on such securities is includable in","page_number":517,"box":{"x":45,"y":722,"width":907,"height":13}},{"id":"dc690a8e-46ce-49b7-9496-0e11ea9f212f","block_type":"box","text":"gross income for Federal income tax purposes either because the IRS has taken a legal position adverse to the conclusion reached","page_number":517,"box":{"x":45,"y":738,"width":893,"height":12}},{"id":"d391999f-6ffa-4d0b-ab25-0bbe613a4a85","block_type":"box","text":"by the counsel to the issuer in the tax exemption opinion or as a result of an action taken or not taken after the date of issue of","page_number":517,"box":{"x":46,"y":753,"width":879,"height":13}},{"id":"bc15fdce-53a7-4165-9a79-3951a5cc98cc","block_type":"box","text":"such obligation.","page_number":517,"box":{"x":46,"y":769,"width":109,"height":13}},{"id":"e8b2d1c5-21e7-4e1b-b131-b2b54830c283","block_type":"box","text":"If interest paid on a Municipal Security in which a Fund invests is determined to be taxable subsequent to the Fund’s acquisition of","page_number":517,"box":{"x":45,"y":792,"width":908,"height":13}},{"id":"2f304ae9-ac08-4e1b-aa9a-f43e9aacbf74","block_type":"box","text":"such security, the IRS may demand that such Fund pay taxes on the affected interest income and, if the Fund agrees to do so, its","page_number":517,"box":{"x":46,"y":807,"width":885,"height":13}},{"id":"9761688d-f604-4627-8115-129648f34ce6","block_type":"box","text":"yield could be adversely affected. If the interest paid on any Municipal Security held by a Fund is determined to be taxable, such","page_number":517,"box":{"x":45,"y":823,"width":887,"height":13}},{"id":"ef4dc6ee-2fe1-4a95-bd66-2e4ac5e27d4b","block_type":"box","text":"Fund will dispose of the security as soon as practicable. A determination that interest on a security held by a Fund is includable in","page_number":517,"box":{"x":45,"y":838,"width":899,"height":13}},{"id":"75b58cb1-0c96-4fba-8cb5-34dbf88ad02b","block_type":"box","text":"gross income for Federal or state income tax purposes retroactively to its date of issue may, likewise, cause a portion of prior","page_number":517,"box":{"x":45,"y":854,"width":866,"height":13}},{"id":"972e147b-2298-444f-a9bb-5c7c46a28b91","block_type":"box","text":"distributions received by shareholders to be taxable to those shareholders in the year of receipt.","page_number":517,"box":{"x":46,"y":869,"width":657,"height":13}},{"id":"06dff352-fb64-4a1c-8a69-d03ad0d6b99d","block_type":"box","text":"II-7","page_number":517,"box":{"x":487,"y":917,"width":25,"height":9}},{"id":"91fb7152-126f-4f82-90c9-89ebc94b3976","block_type":"box","text":"NM1026U-6004382-517/605","page_number":517,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"1cd6f083-5a4e-4bb3-b198-eb1128f031de","block_type":"box","text":"From time to time, proposals have been introduced before Congress","page_number":518,"box":{"x":45,"y":79,"width":471,"height":13}},{"id":"9b038a28-395a-4411-b5ea-c6a0c73ed273","block_type":"box","text":"for the purpose of restricting or eliminating the Federal","page_number":518,"box":{"x":521,"y":79,"width":382,"height":13}},{"id":"cac3d63f-ae26-4ad1-a74b-006a12967313","block_type":"box","text":"income tax exclusion for interest on Municipal Securities. Similar proposals may be introduced in the future. If such a proposal","page_number":518,"box":{"x":45,"y":94,"width":881,"height":13}},{"id":"6be41d76-cc7f-4905-9907-1b9f47b3a921","block_type":"box","text":"were enacted, the ability of each Fund to pay “exempt-interest dividends” would be affected adversely and the Fund would","page_number":518,"box":{"x":45,"y":110,"width":854,"height":13}},{"id":"faecccf5-271f-4e78-b7f4-fd8186448e81","block_type":"box","text":"re-evaluate its investment objectives and policies and consider changes in structure. See “Dividends and Taxes — Taxes.”","page_number":518,"box":{"x":45,"y":125,"width":840,"height":13}},{"id":"181fb253-5731-4d78-952d-fbc99a7520e9","block_type":"box","text":"Municipal Securities — Derivative Products","page_number":518,"box":{"x":45,"y":151,"width":304,"height":13}},{"id":"6bce4aee-dac7-4431-a34b-d16d88a221d2","block_type":"box","text":". Derivative Products are typically structured by a bank, broker-dealer or other","page_number":518,"box":{"x":351,"y":151,"width":545,"height":13}},{"id":"298c99aa-05e1-4e15-8fbb-db4ef888b0a8","block_type":"box","text":"financial institution. A Derivative Product generally consists of a trust or partnership through which a Fund holds an interest in","page_number":518,"box":{"x":45,"y":166,"width":883,"height":13}},{"id":"ad79fde6-7851-4ebe-bc75-3c83367773ad","block_type":"box","text":"one or more underlying bonds coupled with a right to sell (“put”) the Fund’s interest in the underlying bonds at par plus accrued","page_number":518,"box":{"x":46,"y":182,"width":893,"height":13}},{"id":"90e56db8-af91-425d-90e3-7d5014b89aa2","block_type":"box","text":"interest to a financial institution (a “Liquidity Provider”). Typi","page_number":518,"box":{"x":45,"y":197,"width":435,"height":13}},{"id":"c4e5957d-3dad-4b86-a982-a4835502a6df","block_type":"box","text":"cally, a Derivative Product is structured as a trust or partnership","page_number":518,"box":{"x":481,"y":197,"width":444,"height":13}},{"id":"3df6aa53-3c7e-4605-842d-f1d0b825a8d8","block_type":"box","text":"that provides for pass-through tax-exempt income. There are cu","page_number":518,"box":{"x":45,"y":213,"width":444,"height":13}},{"id":"bbf35f57-797f-4a1b-a02d-499ad97266c5","block_type":"box","text":"rrently three principal types of derivative structures: (1) “Tender","page_number":518,"box":{"x":490,"y":213,"width":445,"height":13}},{"id":"8dda48fa-3d50-4845-90d6-0245a0b06747","block_type":"box","text":"Option Bonds,” which are instruments that grant the holder thereof the right to put an underlying bond at par plus accrued","page_number":518,"box":{"x":46,"y":228,"width":857,"height":13}},{"id":"022b1175-55f2-492b-8a6e-40195d5cb9c2","block_type":"box","text":"interest at specified intervals to a Liquidity Provider; (2) “Swap","page_number":518,"box":{"x":45,"y":244,"width":438,"height":13}},{"id":"e1ff32fd-628b-4584-a91c-40c89ad86053","block_type":"box","text":"Products,” in which the trust or partnership swaps the payments","page_number":518,"box":{"x":488,"y":244,"width":447,"height":13}},{"id":"6b8fafc3-9f16-458e-87ac-360e1f3b5195","block_type":"box","text":"due on an underlying bond with a swap counterparty who agrees to pay a floating municipal money market interest rate; and (3)","page_number":518,"box":{"x":46,"y":259,"width":894,"height":13}},{"id":"10868890-2e08-48cc-bb14-fa0b2ff029ad","block_type":"box","text":"“Partnerships,” which allocate to the partners portions of inco","page_number":518,"box":{"x":47,"y":275,"width":432,"height":13}},{"id":"fd0f5494-1560-4c4d-9cbe-3cef7a27a0e3","block_type":"box","text":"me, expenses, capital gains and losses associated with holding an","page_number":518,"box":{"x":480,"y":275,"width":449,"height":13}},{"id":"1a8d26c6-2b16-4b9c-9efd-b4ecc0adb832","block_type":"box","text":"underlying bond in accordance with a governing agreement. A Fund may also invest in other forms of short term Derivative","page_number":518,"box":{"x":46,"y":290,"width":858,"height":13}},{"id":"2a5e9a24-2bde-4a9f-bb53-1205bc22c9b5","block_type":"box","text":"Products eligible for investment by money market funds.","page_number":518,"box":{"x":45,"y":306,"width":392,"height":13}},{"id":"986a8f06-4e85-4dab-a26c-a679bf673079","block_type":"box","text":"Investments in Derivative Products raise certain tax, legal, regulatory and accounting issues that may not be presented by","page_number":518,"box":{"x":45,"y":331,"width":838,"height":13}},{"id":"0182357f-d86e-4256-8541-cabf9a994b11","block_type":"box","text":"investments in municipal bonds. There is some risk that certain issues could be resolved in a manner that could adversely impact","page_number":518,"box":{"x":45,"y":347,"width":890,"height":13}},{"id":"702702f5-9d04-4c5f-b6d0-2eb60d05c8bc","block_type":"box","text":"the performance of a Fund. For example, the tax-exempt treatment of the interest paid to holders of Derivative Products is","page_number":518,"box":{"x":45,"y":362,"width":849,"height":13}},{"id":"b2a1a707-03a7-4959-9ece-ee072e071110","block_type":"box","text":"premised on the legal conclusion that the holders of such Deri","page_number":518,"box":{"x":45,"y":378,"width":429,"height":13}},{"id":"fb41e297-88e4-4e23-8537-824deb23836e","block_type":"box","text":"vative Products have an ownership interest in the underlying bonds.","page_number":518,"box":{"x":474,"y":378,"width":469,"height":13}},{"id":"d4ec5e60-9452-4566-8a6a-19cd657f7b37","block_type":"box","text":"Were the IRS or any state taxing authority to issue an adverse","page_number":518,"box":{"x":45,"y":393,"width":428,"height":13}},{"id":"295f547a-34f1-4c21-bd9c-f78649367077","block_type":"box","text":"ruling or take an adverse position with respect to the taxation of","page_number":518,"box":{"x":479,"y":393,"width":447,"height":13}},{"id":"a7decb9a-f185-437b-b661-80349d050215","block_type":"box","text":"Derivative Products, there is a risk that the interest paid on such Derivative Products or, in the case of property taxes, the value of","page_number":518,"box":{"x":45,"y":409,"width":900,"height":13}},{"id":"574a6877-a628-4010-b5c8-546706da9040","block_type":"box","text":"such Fund to the extent represented by such Derivative Products, would be deemed taxable at the Federal and/or state level.","page_number":518,"box":{"x":46,"y":424,"width":856,"height":13}},{"id":"9da11358-2920-45b0-bbdf-65b957848af9","block_type":"box","text":"Before purchasing a Derivative Product, the Manager is required by the Funds’ procedures to conclude that the tax-exempt","page_number":518,"box":{"x":46,"y":450,"width":852,"height":13}},{"id":"d9a7ac52-7f9e-44db-ac9a-cc96b259f4ac","block_type":"box","text":"security and the supporting short-term obligation involve minimal credit risks and are Eligible Securities under the Funds’","page_number":518,"box":{"x":46,"y":465,"width":840,"height":13}},{"id":"299ce317-4058-43b7-a6c4-9190f57d202b","block_type":"box","text":"Rule 2a-7 procedures. In evaluating the creditworthiness of the e","page_number":518,"box":{"x":46,"y":481,"width":447,"height":13}},{"id":"25bec648-ac33-478a-bbe9-531d24a46229","block_type":"box","text":"ntity obligated to purchase the tax-exempt security, the Manager","page_number":518,"box":{"x":494,"y":481,"width":450,"height":13}},{"id":"03275bb0-de6a-435c-a3fd-8746a621633f","block_type":"box","text":"will review periodically the entity’s relevant financial information.","page_number":518,"box":{"x":45,"y":496,"width":457,"height":13}},{"id":"c76daa69-ddb4-4cd3-8417-506aab41a40e","block_type":"box","text":"Municipal Notes","page_number":518,"box":{"x":45,"y":522,"width":116,"height":12}},{"id":"92feb92a-c9d6-4e9d-94d0-deff1c53041d","block_type":"box","text":". Municipal notes are shorter term municipal debt obligati","page_number":518,"box":{"x":163,"y":522,"width":402,"height":12}},{"id":"44e67fc4-3121-4989-9253-f799741e2915","block_type":"box","text":"ons. They may provide interim financing in anticipation","page_number":518,"box":{"x":565,"y":522,"width":388,"height":12}},{"id":"bb942397-7b68-4eb0-920b-a2bc4bfac744","block_type":"box","text":"of tax collection, bond sales or revenue receipts. If there is a shortfall in the anticipated proceeds, the note may not be fully repaid","page_number":518,"box":{"x":46,"y":537,"width":897,"height":13}},{"id":"d33a9ee1-c2ba-49d4-867a-0c3e73a55744","block_type":"box","text":"and a Fund may lose money.","page_number":518,"box":{"x":46,"y":553,"width":198,"height":12}},{"id":"6473e410-5e74-4d38-9e7d-44484ab4d094","block_type":"box","text":"Municipal Commercial Paper","page_number":518,"box":{"x":45,"y":578,"width":206,"height":13}},{"id":"385441c7-75c6-4fed-bd24-18a4c7b4dd01","block_type":"box","text":". Municipal commercial paper is generally unsecured and issued to meet short term financing needs.","page_number":518,"box":{"x":252,"y":578,"width":690,"height":13}},{"id":"8559a3c9-ba38-46f4-b483-afe4514416c0","block_type":"box","text":"The lack of security presents some risk of loss to a Fund since, in the event of an issuer’s bankruptcy, unsecured creditors are","page_number":518,"box":{"x":45,"y":594,"width":864,"height":12}},{"id":"9a16893f-108a-4dbf-8893-18f00934426f","block_type":"box","text":"repaid only after the secured creditors are paid out of the assets, if any, that remain.","page_number":518,"box":{"x":45,"y":609,"width":580,"height":13}},{"id":"44fa567f-23d5-4da3-b059-b874ae6a4665","block_type":"box","text":"Municipal Lease Obligations","page_number":518,"box":{"x":45,"y":635,"width":201,"height":12}},{"id":"13298bb2-e3db-4beb-a28c-b11f3762e06a","block_type":"box","text":". Also included within the general category of State Municipal Securities are Certificates of","page_number":518,"box":{"x":248,"y":635,"width":626,"height":12}},{"id":"53a97b1b-72dd-4b58-af7f-898e8b7c171a","block_type":"box","text":"Participation (“COPs”) issued by governmental authorities or en","page_number":518,"box":{"x":45,"y":650,"width":449,"height":13}},{"id":"c592ed82-1d8e-48c7-9c7a-afac84bf46be","block_type":"box","text":"tities to finance the acquisition or construction of equipment, land","page_number":518,"box":{"x":494,"y":650,"width":459,"height":13}},{"id":"f4cd91a4-719d-4dd0-9930-532a2956af38","block_type":"box","text":"and/or facilities. The COPs represent participations in a lease, an installment purchase contract or a conditional sales contract","page_number":518,"box":{"x":46,"y":666,"width":870,"height":12}},{"id":"9feff0e4-278d-47cd-bdde-735e35de51fd","block_type":"box","text":"(hereinafter collectively called “lease obligations”) relating t","page_number":518,"box":{"x":46,"y":681,"width":413,"height":13}},{"id":"caf63109-ef17-492a-92c4-f41a2562d440","block_type":"box","text":"o such equipment, land or facilities. Although lease obligations do not","page_number":518,"box":{"x":460,"y":681,"width":485,"height":13}},{"id":"3798aed6-de3b-4e03-be8f-a8c1f9882587","block_type":"box","text":"constitute general obligations of the issuer for which the issuer’s","page_number":518,"box":{"x":45,"y":697,"width":443,"height":12}},{"id":"d898e6bb-9997-46d3-a3e5-57edc763a13e","block_type":"box","text":"unlimited taxing power is pledged, a lease obligation is frequently","page_number":518,"box":{"x":493,"y":697,"width":455,"height":12}},{"id":"5d14accd-8ef7-4526-a09c-c97e57c32bfd","block_type":"box","text":"backed by the issuer’s covenant to budget for, appropriate and make the payments due under the lease obligation. However,","page_number":518,"box":{"x":46,"y":712,"width":861,"height":13}},{"id":"40f37437-207c-46e3-91b0-cc06b22df7dc","block_type":"box","text":"certain lease obligations contain “non-appropriation” clauses th","page_number":518,"box":{"x":45,"y":728,"width":445,"height":12}},{"id":"4771c8b3-d59d-4049-b58e-0312940e54b9","block_type":"box","text":"at provide that the issuer has no obligation to make lease or","page_number":518,"box":{"x":491,"y":728,"width":414,"height":12}},{"id":"85a4bfa4-4825-4e86-bc5a-43fe601c3e32","block_type":"box","text":"installment purchase payments in future years unless money is appropriated for such purpose on a yearly basis. Although “non","page_number":518,"box":{"x":45,"y":743,"width":886,"height":13}},{"id":"a2ec9062-b4c1-442e-973b-320d28a9fa7c","block_type":"box","text":"appropriation” lease obligations are secured by the leased property, disposition of the property in the event of foreclosure might","page_number":518,"box":{"x":46,"y":759,"width":886,"height":12}},{"id":"df8afa15-35b6-4deb-92db-def41062e5ad","block_type":"box","text":"prove difficult. The securities represent a type of financing that has not yet developed the depth of marketability associated with","page_number":518,"box":{"x":45,"y":774,"width":886,"height":13}},{"id":"072d1fda-74fc-4e70-85bf-cfdaafbe0836","block_type":"box","text":"more conventional securities. Certain investments in lease obligations may be illiquid.","page_number":518,"box":{"x":45,"y":790,"width":592,"height":12}},{"id":"9104e936-6be1-436a-b6ff-e0643e4d07a8","block_type":"box","text":"Municipal Securities — Short-Term Maturity Standards","page_number":518,"box":{"x":45,"y":815,"width":386,"height":13}},{"id":"d6e151e1-33af-4e51-883b-cf620acce0b8","block_type":"box","text":". All of the investments of a Fund in Municipal Securities will be in","page_number":518,"box":{"x":432,"y":815,"width":462,"height":13}},{"id":"550df2ad-5ffb-4ace-a9df-1a5600539c58","block_type":"box","text":"securities with remaining maturities of 397 days or less. The dollar-weighted average maturity of each Fund’s portfolio will be","page_number":518,"box":{"x":46,"y":831,"width":873,"height":12}},{"id":"f48b9a2f-b52d-45b1-9e08-778c0d3a84da","block_type":"box","text":"60 days or less. For purposes of this investment policy, an obligation will be treated as having a maturity earlier than its stated","page_number":518,"box":{"x":46,"y":846,"width":874,"height":13}},{"id":"0e9274ca-229e-4ed0-a818-03dd048f5363","block_type":"box","text":"maturity date if such obligation has technical features that, i","page_number":518,"box":{"x":45,"y":862,"width":416,"height":12}},{"id":"37c78dc4-9bbd-4c56-98e9-ac9b422e8947","block_type":"box","text":"n the judgment of the Manager, will result in the obligation being","page_number":518,"box":{"x":462,"y":862,"width":454,"height":12}},{"id":"e04c5b52-9ab8-4aee-b5af-6590067995b9","block_type":"box","text":"valued in the market as though it has such earlier maturity.","page_number":518,"box":{"x":45,"y":877,"width":409,"height":13}},{"id":"041bc4b7-c6f1-4f0c-8c2e-729cdda74b41","block_type":"box","text":"II-8","page_number":518,"box":{"x":487,"y":917,"width":24,"height":9}},{"id":"1e4072ac-eeb4-4567-9b36-9ad099738e39","block_type":"box","text":"NM1026U-6004382-518/605","page_number":518,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"363bce7a-ab71-4a61-aa7d-2ce6f003e243","block_type":"box","text":"The maturities of Variable Rate Demand Obligations (“VRDOs”) are deemed to be the longer of (i) the notice period required","page_number":519,"box":{"x":45,"y":79,"width":878,"height":13}},{"id":"e524f6a7-abf7-4e90-9ae4-643830090d3a","block_type":"box","text":"before a Fund is entitled to receive payment of the principal amount of the VRDOs on demand or (ii) the period remaining until","page_number":519,"box":{"x":46,"y":94,"width":887,"height":13}},{"id":"e451e3a0-d681-4173-85c7-c7b041ac206a","block_type":"box","text":"the VRDO’s next interest rate adjustment. If not redeemed by a F","page_number":519,"box":{"x":45,"y":110,"width":454,"height":13}},{"id":"3ad7352c-4ad4-4386-984c-12707033af17","block_type":"box","text":"und through the demand feature, VRDOs mature on a specified","page_number":519,"box":{"x":500,"y":110,"width":443,"height":13}},{"id":"fb3431da-4db4-4b90-ad74-b738d2ca882f","block_type":"box","text":"date, which may range up to 30 years from the date of issuance. See “VRDOs” below.","page_number":519,"box":{"x":46,"y":125,"width":599,"height":13}},{"id":"e0dbe262-d397-4a22-ae9f-024f8b86a932","block_type":"box","text":"Municipal Securities — Quality Standards","page_number":519,"box":{"x":45,"y":150,"width":293,"height":13}},{"id":"827d56ec-d518-40b5-97d5-02a4e0421a99","block_type":"box","text":". A Fund’s portfolio investments in municipal notes and short term tax-exempt","page_number":519,"box":{"x":339,"y":150,"width":545,"height":13}},{"id":"20942bfa-b30d-4de1-9e87-0adc81f5e732","block_type":"box","text":"commercial paper will be limited to those obligations that are (i) secu","page_number":519,"box":{"x":45,"y":165,"width":480,"height":13}},{"id":"2e76418a-1378-40aa-a166-0cfb98635f91","block_type":"box","text":"red by a pledge of the full faith and credit of the United States","page_number":519,"box":{"x":526,"y":165,"width":427,"height":13}},{"id":"f8d0effe-b91c-4072-92c5-1b579b5826e3","block_type":"box","text":"or (ii) otherwise are determined by the Manager to present minimal credit risks to the Fund. A Fund’s investments in municipal","page_number":519,"box":{"x":46,"y":181,"width":881,"height":13}},{"id":"b2e69b81-9636-4fca-bfd3-d2b8639ef13d","block_type":"box","text":"bonds will be in securities that have been determined by the Manager to present minimal credit risks to the Fund. In addition,","page_number":519,"box":{"x":46,"y":196,"width":869,"height":13}},{"id":"24a0a8f6-b374-4f71-b33c-15e998665606","block_type":"box","text":"certain Funds may require that portfolio investments (or their issuers) receive minimum credit ratings from one or more NRSROs,","page_number":519,"box":{"x":45,"y":212,"width":902,"height":13}},{"id":"d9dd0c7b-d03a-4093-8c59-cf1bff7ea432","block_type":"box","text":"or if not rated, are determined by the Manager to be of comparable quality to securities that have received such rating(s). Certain","page_number":519,"box":{"x":46,"y":227,"width":895,"height":13}},{"id":"9e9b2a9c-9e93-4ca9-9750-29f1524e3b86","block_type":"box","text":"tax-exempt obligations (primarily VRDOs) may be entitled to the be","page_number":519,"box":{"x":45,"y":243,"width":476,"height":13}},{"id":"e24212cf-53db-4c79-b573-a698869c27ea","block_type":"box","text":"nefit of letters of credit or similar credit enhancements issued","page_number":519,"box":{"x":522,"y":243,"width":421,"height":10}},{"id":"fb103f69-4721-4d55-8c00-d03ab7c59294","block_type":"box","text":"by financial institutions. In such instances, in assessing the quality","page_number":519,"box":{"x":46,"y":258,"width":454,"height":13}},{"id":"9dcc9911-df41-4028-b374-760cffc4090e","block_type":"box","text":"of such instruments, the Trustees and the Manager will take into","page_number":519,"box":{"x":505,"y":258,"width":448,"height":13}},{"id":"8d06ea61-7bb4-42a0-921f-de3bdbfd52a9","block_type":"box","text":"account not only the creditworthiness of the issuers, but also the","page_number":519,"box":{"x":46,"y":274,"width":445,"height":13}},{"id":"e84abfe1-15f0-489d-8e5e-585eddadb4fd","block_type":"box","text":"creditworthiness and type of obligation of the financial","page_number":519,"box":{"x":496,"y":274,"width":381,"height":13}},{"id":"e13cf928-b350-4943-8db7-1b5aec3b062f","block_type":"box","text":"institution. The type of obligation of the financial institution con","page_number":519,"box":{"x":45,"y":289,"width":448,"height":13}},{"id":"5182e1e8-43c5-4dbf-9259-2e6212ae3d7b","block_type":"box","text":"cerns, for example, whether the letter of credit or similar credit","page_number":519,"box":{"x":494,"y":289,"width":436,"height":13}},{"id":"ab7280dc-b848-4c22-821b-153b431696d3","block_type":"box","text":"enhancement being issued is conditional or unconditional. Fo","page_number":519,"box":{"x":46,"y":305,"width":424,"height":13}},{"id":"8d92caa0-c991-45de-b0c9-6e79604f514c","block_type":"box","text":"r a description of debt ratings, see Appendix A —“Description of","page_number":519,"box":{"x":471,"y":305,"width":453,"height":13}},{"id":"12fa9647-a2c4-4530-88ac-858ac05b5b8c","block_type":"box","text":"Bond Ratings.”","page_number":519,"box":{"x":46,"y":320,"width":105,"height":13}},{"id":"d99c5670-3c46-4aed-b42a-c44bc6c2d282","block_type":"box","text":"Certain Funds may not invest in any security issued by a depository","page_number":519,"box":{"x":46,"y":345,"width":467,"height":13}},{"id":"c99dc03d-d453-4287-8ef2-df63c63cc9da","block_type":"box","text":"institution unless such institution is organized and operating in","page_number":519,"box":{"x":518,"y":345,"width":435,"height":13}},{"id":"5b4161ac-636d-4657-a2b3-4e9a2e76ee0c","block_type":"box","text":"the United States, has total assets of at least $1 billion and is fe","page_number":519,"box":{"x":45,"y":360,"width":434,"height":13}},{"id":"3919590c-afa3-4998-a066-9312f644d430","block_type":"box","text":"derally insured. While the types of money market securities in","page_number":519,"box":{"x":480,"y":360,"width":428,"height":13}},{"id":"63774115-2ae0-464e-a9dc-3e3cbeff8d16","block_type":"box","text":"which the Funds invest generally are considered to have low princip","page_number":519,"box":{"x":45,"y":376,"width":470,"height":13}},{"id":"70418058-4cfe-4b40-a0d2-7d2fef50dbe9","block_type":"box","text":"al risk, such securities are not completely risk free. There is a","page_number":519,"box":{"x":516,"y":376,"width":420,"height":13}},{"id":"f10b94f4-fe7f-4cdd-adea-fef75f209ad6","block_type":"box","text":"risk of the failure of issuers or credit enhancers to meet thei","page_number":519,"box":{"x":45,"y":391,"width":411,"height":10}},{"id":"452e49f9-9ad0-424c-83f1-838089f7243e","block_type":"box","text":"r principal and interest obligations. With respect to repurchase","page_number":519,"box":{"x":456,"y":391,"width":433,"height":13}},{"id":"0eb38cbd-2a31-4c09-ba28-c64ef98ab2de","block_type":"box","text":"agreements and purchase and sale contracts, there is also the risk o","page_number":519,"box":{"x":46,"y":407,"width":462,"height":13}},{"id":"535dec76-8d54-484f-a62a-92a2397fdf77","block_type":"box","text":"f the failure of the parties involved to repurchase at the agreed","page_number":519,"box":{"x":509,"y":407,"width":435,"height":13}},{"id":"cea0f245-ee90-4759-80f0-599a5fe16dd5","block_type":"box","text":"upon price, in which event each Fund may suffer time delays and incur costs or possible losses in connection with such","page_number":519,"box":{"x":46,"y":422,"width":821,"height":13}},{"id":"808b0a86-0daf-4213-950a-de64ce592081","block_type":"box","text":"transactions.","page_number":519,"box":{"x":45,"y":439,"width":87,"height":9}},{"id":"7c2c7a07-6125-464b-92ac-1ad45510a14b","block_type":"box","text":"Municipal Securities — Other Factors","page_number":519,"box":{"x":45,"y":462,"width":263,"height":13}},{"id":"f392d128-f30b-4d9a-8df4-27fd1394a47c","block_type":"box","text":". Management of the Funds will endeavor to be as fully invested as reasonably practicable in","page_number":519,"box":{"x":310,"y":462,"width":639,"height":13}},{"id":"d8a9f39e-2502-4840-984b-9bb24cbf4ec4","block_type":"box","text":"order to maximize the yield on each Fund’s portfolio. Not all short term municipal securities trade on the basis of same day","page_number":519,"box":{"x":46,"y":478,"width":856,"height":13}},{"id":"abce5759-4111-458f-bf0a-9fece1f96279","block_type":"box","text":"settlements and, accordingly, a portfolio of such securities cannot be managed on a daily basis with the same flexibility as a","page_number":519,"box":{"x":46,"y":493,"width":854,"height":13}},{"id":"4ac7524e-1e3a-4347-a913-364ec8b2d58a","block_type":"box","text":"portfolio of money market securities, which can be bought and sold on a same day basis. There may be times when a Fund has","page_number":519,"box":{"x":45,"y":509,"width":880,"height":13}},{"id":"92f25d8b-3f25-4a87-a333-2ee808d9815c","block_type":"box","text":"uninvested cash resulting from an influx of cash due to large pu","page_number":519,"box":{"x":46,"y":524,"width":440,"height":13}},{"id":"c2750cd9-7211-4336-bca4-4a535577c093","block_type":"box","text":"rchases of shares or the maturing of portfolio securities. A Fund","page_number":519,"box":{"x":487,"y":524,"width":442,"height":13}},{"id":"d3ad5a79-09b0-4d24-ab4b-5e78cc9e5b0e","block_type":"box","text":"also may be required to maintain cash reserves or incur temporar","page_number":519,"box":{"x":46,"y":540,"width":451,"height":13}},{"id":"fd2934b6-4612-4951-8f9e-c114ac6d50ea","block_type":"box","text":"y bank borrowings to make redemption payments, which are","page_number":519,"box":{"x":498,"y":540,"width":424,"height":13}},{"id":"eee3dbdf-da30-4941-b150-31cb1ddeafff","block_type":"box","text":"made on the same day the redemption request is received. Such in","page_number":519,"box":{"x":45,"y":555,"width":455,"height":13}},{"id":"5dbe9205-715f-49f7-bb14-4df9362e0639","block_type":"box","text":"ability to be invested fully would lower the yield on such Fund’s","page_number":519,"box":{"x":501,"y":555,"width":443,"height":13}},{"id":"a14fc01f-efcd-4b06-8963-d7e9dff727ef","block_type":"box","text":"portfolio.","page_number":519,"box":{"x":45,"y":571,"width":65,"height":13}},{"id":"8425cd07-b8df-4a11-a8ac-c50fb8ab813f","block_type":"box","text":"Because certain Funds may at times invest a substantial portion of their assets in Municipal Securities secured by bank letters of","page_number":519,"box":{"x":46,"y":595,"width":883,"height":13}},{"id":"36c62d62-1107-4a34-b348-cd8fea2e242a","block_type":"box","text":"credit or guarantees, an investment in a Fund should be made with an","page_number":519,"box":{"x":45,"y":611,"width":485,"height":13}},{"id":"fae989f6-3316-490c-b248-c1edcfe31fc8","block_type":"box","text":"understanding of the characteristics of the banking industry","page_number":519,"box":{"x":535,"y":611,"width":413,"height":13}},{"id":"450c411b-cbab-45f6-8055-f7897c409c0d","block_type":"box","text":"and the risks that such an investment in such credit enhanced securities may entail. Banks are subject to extensive governmental","page_number":519,"box":{"x":46,"y":626,"width":883,"height":13}},{"id":"30571c5b-52d5-4cb8-896b-2f093acd7367","block_type":"box","text":"regulations that may limit both the amounts and types of loans","page_number":519,"box":{"x":45,"y":642,"width":437,"height":13}},{"id":"1730e5e5-cb0a-4d25-b2be-bf7fd0b6e59b","block_type":"box","text":"and other financial commitments that may be made and interest","page_number":519,"box":{"x":487,"y":642,"width":444,"height":13}},{"id":"86b30881-5f48-4484-beb6-c996f4ca5a62","block_type":"box","text":"rates and fees that may be charged. The profitability of the banking industry is largely dependent on the availability and cost of","page_number":519,"box":{"x":45,"y":657,"width":883,"height":13}},{"id":"802eda11-59c9-4acf-8fd5-a0d1c18ee706","block_type":"box","text":"capital funds for the purpose of financing lending operations under prevailing money market conditions. Furthermore, general","page_number":519,"box":{"x":45,"y":673,"width":876,"height":13}},{"id":"f63ab336-e646-484d-8169-2b5c31019738","block_type":"box","text":"economic conditions play an important part in the operations of this industry and exposure to credit losses arising from possible","page_number":519,"box":{"x":46,"y":688,"width":888,"height":13}},{"id":"82ecf85f-e600-4c42-aaf9-48c49873fd27","block_type":"box","text":"financial difficulties of borrowers might affect a ba","page_number":519,"box":{"x":45,"y":704,"width":352,"height":13}},{"id":"e043638e-5e44-41da-a23d-4a2731b3b84e","block_type":"box","text":"nk’s ability to meet its obligations under a letter of credit.","page_number":519,"box":{"x":398,"y":704,"width":397,"height":13}},{"id":"c59b4f01-8e1c-43df-a88b-c88c99bd4b63","block_type":"box","text":"Changes to the Code may limit the types and volume of securities","page_number":519,"box":{"x":46,"y":728,"width":453,"height":13}},{"id":"b4aad813-18d1-4604-8358-3353ef94c382","block_type":"box","text":"qualifying for the Federal income tax exemption of interest; this","page_number":519,"box":{"x":504,"y":728,"width":442,"height":13}},{"id":"4fd58683-8f78-4743-801b-6d5fe8afa9e4","block_type":"box","text":"may affect the availability of Municipal Securities for investment by the Funds, which could, in turn, have a negative impact on the","page_number":519,"box":{"x":45,"y":744,"width":907,"height":13}},{"id":"4d954df1-8aaa-4164-b4c0-7e156e699839","block_type":"box","text":"yield of the portfolios. A Fund reserves the right to suspend or other","page_number":519,"box":{"x":45,"y":759,"width":472,"height":13}},{"id":"fac1784e-5ff5-4231-b4db-68f84bfea87a","block_type":"box","text":"wise limit sales of its shares if, as a result of difficulties in","page_number":519,"box":{"x":517,"y":759,"width":395,"height":13}},{"id":"abf29cd7-8e4b-492a-8ad2-f42dc011603e","block_type":"box","text":"acquiring portfolio securities or otherwise, it is determined that it is not in the interests of the Fund’s shareholders to issue","page_number":519,"box":{"x":46,"y":775,"width":842,"height":13}},{"id":"3bf2d630-8a6a-4853-bf3d-b434cb025ac4","block_type":"box","text":"additional shares.","page_number":519,"box":{"x":46,"y":790,"width":120,"height":10}},{"id":"c0f90f1f-c9fe-4f39-bb2b-f8268a56e5f1","block_type":"box","text":"VRDOs","page_number":519,"box":{"x":47,"y":815,"width":56,"height":10}},{"id":"e081174f-3b0f-4cb3-951a-68ed7d3bfb12","block_type":"box","text":". VRDOs are tax-exempt obligations that contain a floatin","page_number":519,"box":{"x":104,"y":815,"width":405,"height":13}},{"id":"40daf02e-7649-43c7-a2bd-21d0b32737b0","block_type":"box","text":"g or variable interest rate adjustment formula and right of","page_number":519,"box":{"x":510,"y":815,"width":402,"height":13}},{"id":"a51b7316-2c1f-4168-ae69-591ab499db2a","block_type":"box","text":"demand on the part of the holder thereof to receive payment of the unpaid balance plus accrued interest upon a short notice","page_number":519,"box":{"x":46,"y":830,"width":858,"height":13}},{"id":"a676f895-77dd-4677-838c-6be89db55f7d","block_type":"box","text":"period not to exceed seven days. There is, however, the possibility","page_number":519,"box":{"x":45,"y":846,"width":457,"height":13}},{"id":"30fb4a98-f081-4bd0-902c-4f16f3812dea","block_type":"box","text":"that because of default or insolvency the demand feature of","page_number":519,"box":{"x":507,"y":846,"width":411,"height":13}},{"id":"0fe1ecff-4ea6-4093-a466-2ab721616b1a","block_type":"box","text":"VRDOs may not be honored. The interest rates are adjustable at periodic intervals to some prevailing market rate of the VRDOs","page_number":519,"box":{"x":45,"y":861,"width":894,"height":13}},{"id":"f29beb08-1567-415c-bf6b-152d57b9d00f","block_type":"box","text":"at approximately the par value of the VRDOs on the adjustment date. The adjustment may be based upon the Securities Industry","page_number":519,"box":{"x":46,"y":877,"width":896,"height":13}},{"id":"f863b909-9ff0-49bc-b910-f9d5a2f0dd32","block_type":"box","text":"II-9","page_number":519,"box":{"x":487,"y":917,"width":25,"height":9}},{"id":"2cf926cb-0088-40ff-8dbd-8108f2e21094","block_type":"box","text":"NM1026U-6004382-519/605","page_number":519,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"cff76b64-8e1c-4dea-a6ee-2fbe97536bb2","block_type":"box","text":"and Financial Markets Association (“SIFMA”) Municipal Swap Index or some other appropriate interest rate adjustment index.","page_number":520,"box":{"x":46,"y":79,"width":888,"height":13}},{"id":"37bc0896-a1a4-4d0c-a1c1-b8a9649bb401","block_type":"box","text":"Each Fund may invest in all types of tax-exempt instruments currently outstanding or to be issued in the future that satisfy its","page_number":520,"box":{"x":45,"y":94,"width":869,"height":13}},{"id":"6cdfe1c3-0ea2-435f-99fb-dc1356a4f93b","block_type":"box","text":"short term maturity and quality standards.","page_number":520,"box":{"x":46,"y":110,"width":294,"height":13}},{"id":"d77ce491-938d-435d-acdb-372653a6d094","block_type":"box","text":"Because of the interest rate adjustment formula on VRDOs, the","page_number":520,"box":{"x":46,"y":132,"width":439,"height":12}},{"id":"920ba203-526f-4a6f-8e5e-cc487023404a","block_type":"box","text":"VRDOs are not comparable to fixed rate securities. A Fund’s yield","page_number":520,"box":{"x":490,"y":132,"width":461,"height":12}},{"id":"eae72053-f5ab-4e5e-afc9-4a3c8cf69806","block_type":"box","text":"on VRDOs will decline and its shareholders will forego the opportun","page_number":520,"box":{"x":46,"y":147,"width":479,"height":13}},{"id":"8e5e2cf9-28d9-4927-b2e9-ab4041e03396","block_type":"box","text":"ity for capital appreciation during periods when prevailing","page_number":520,"box":{"x":525,"y":147,"width":405,"height":13}},{"id":"875dd90e-d61b-4d99-9751-135e2abf4957","block_type":"box","text":"interest rates have declined. On the other hand, during periods where prevailing interest rates have increased, a Fund’s yield on","page_number":520,"box":{"x":45,"y":163,"width":879,"height":12}},{"id":"886e9875-74a1-4efd-89ac-07ee956f0774","block_type":"box","text":"VRDOs will increase and its shareholders will have a reduced risk of capital depreciation.","page_number":520,"box":{"x":45,"y":178,"width":621,"height":13}},{"id":"ce203557-b38c-4160-9fe4-bebc425b7c53","block_type":"box","text":"Negative Interest Rate Scenarios.","page_number":520,"box":{"x":45,"y":201,"width":230,"height":12}},{"id":"e080c52c-625c-4961-aba7-87a3da83f4ce","block_type":"box","text":"Should a negative interest rate scenario ever occur that causes a government or retail money","page_number":520,"box":{"x":282,"y":200,"width":636,"height":13}},{"id":"5d573c9c-81d2-4bd2-ae2f-f3e79cd4af98","block_type":"box","text":"market fund to have a negative gross yield, the fund may account for the negative gross yield by either using a floating NAV or a","page_number":520,"box":{"x":45,"y":216,"width":893,"height":12}},{"id":"73250229-fafc-412e-af8e-d4b1da5ae2e4","block_type":"box","text":"reverse distribution mechanism that seeks to maintain a stable ne","page_number":520,"box":{"x":45,"y":231,"width":451,"height":10}},{"id":"e9a48008-1d96-49cb-a88a-45ef38d120d8","block_type":"box","text":"t asset value of the fund by cancelling shareholders’ shares in the","page_number":520,"box":{"x":496,"y":231,"width":447,"height":13}},{"id":"85b4b649-4d12-40c8-a559-f88c66709eea","block_type":"box","text":"amount of the negative gross yield. If a fund converts to a floating NAV, any losses the fund experiences due to negative interest","page_number":520,"box":{"x":46,"y":247,"width":887,"height":12}},{"id":"dc61fb95-2088-4cde-98c6-65de4ffc4b33","block_type":"box","text":"rates will be reflected in a declining NAV per share. Under a reverse distribution mechanism, shareholders in a fund would observe","page_number":520,"box":{"x":45,"y":262,"width":908,"height":13}},{"id":"a3e9a443-0d6c-4d29-8c4c-b7f3c1f3f568","block_type":"box","text":"a stable share price but a declining number of shares for their investment. This means that such an investor would lose money","page_number":520,"box":{"x":46,"y":278,"width":871,"height":12}},{"id":"bb26c18d-0d2b-414d-83c3-bc732a5f5682","block_type":"box","text":"when the fund cancels shares. In either situation, the Board will n","page_number":520,"box":{"x":45,"y":293,"width":453,"height":12}},{"id":"2426dc3e-4798-43ee-9896-038b54344e98","block_type":"box","text":"eed to determine that the approach is in the best interests of the","page_number":520,"box":{"x":499,"y":293,"width":439,"height":13}},{"id":"cd7baacb-6972-4bf7-a0b0-1ccf519b1a98","block_type":"box","text":"fund and will need to ensure shareholders are provided adequate disclosures around the consequences of the approach chosen by","page_number":520,"box":{"x":45,"y":309,"width":895,"height":12}},{"id":"b8a2e06b-e7a4-4139-b16c-d227d32faa51","block_type":"box","text":"the Board for the fund.","page_number":520,"box":{"x":45,"y":324,"width":159,"height":10}},{"id":"4073d39d-6860-4aea-aced-5a0ca49382b9","block_type":"box","text":"Operational and Technology Risks.","page_number":520,"box":{"x":46,"y":346,"width":248,"height":13}},{"id":"b2644d4d-7b45-4cf1-a5d7-e82680ae0375","block_type":"box","text":"Each Fund and the entities with which it interacts directly or indirectly are susceptible to","page_number":520,"box":{"x":301,"y":346,"width":612,"height":13}},{"id":"2f55ec1d-04bc-424a-aa12-95829cbabdfe","block_type":"box","text":"operational and technology risks, including those related","page_number":520,"box":{"x":46,"y":362,"width":392,"height":12}},{"id":"c4ff57d2-9492-446a-880a-3eb4d9f2fc19","block_type":"box","text":"to human errors, processing errors, communication errors, systems","page_number":520,"box":{"x":443,"y":362,"width":463,"height":12}},{"id":"ee545b6f-f401-4b12-bdca-ffe0ebbbaf78","block_type":"box","text":"failures, cybersecurity incidents, and the use of artificial intellig","page_number":520,"box":{"x":45,"y":377,"width":436,"height":13}},{"id":"6d8e3333-e9df-43aa-91fd-87ab967b06e5","block_type":"box","text":"ence and machine learning (“AI”), which may result in losses for a","page_number":520,"box":{"x":482,"y":377,"width":460,"height":13}},{"id":"c140fb19-5b86-4963-b9bc-4548acb43b34","block_type":"box","text":"Fund and its shareholders or impair a Fund’s operations. These entities include, but are not limited to, a Fund’s adviser,","page_number":520,"box":{"x":45,"y":393,"width":829,"height":12}},{"id":"8efdba04-1145-4a43-a99e-873d56f84f05","block_type":"box","text":"administrator, distributor, other service providers (e.g., index a","page_number":520,"box":{"x":46,"y":408,"width":436,"height":13}},{"id":"30547be5-e4fe-418a-b7a1-1b64511a3ec5","block_type":"box","text":"nd benchmark providers, accountants, custodians, and transfer","page_number":520,"box":{"x":482,"y":408,"width":437,"height":13}},{"id":"a906b882-51f1-4536-b05f-49322008f7a8","block_type":"box","text":"agents), financial intermediaries, counterparties, market makers, Aut","page_number":520,"box":{"x":46,"y":424,"width":475,"height":12}},{"id":"6047bfeb-f91c-4e45-9cc0-7e138b683350","block_type":"box","text":"horized Participants, listing exchanges, other financial market","page_number":520,"box":{"x":522,"y":424,"width":427,"height":12}},{"id":"7bd2fb7b-c366-40a6-b543-0c0cce539391","block_type":"box","text":"operators, and governmental authorities, as applicable. Operational and technology risks for the issuers in which a Fund invests","page_number":520,"box":{"x":46,"y":439,"width":885,"height":13}},{"id":"88fc2e38-3b9c-4588-9426-82c758f1b4ca","block_type":"box","text":"could also result in material adverse consequences for such issuers and may cause a Fund’s investments in such issuers to lose","page_number":520,"box":{"x":45,"y":455,"width":866,"height":12}},{"id":"a95acd3f-8c3b-4032-863d-406e31c6ab93","block_type":"box","text":"value. A Fund may incur substantial costs in order to mitigate operational and technology risks.","page_number":520,"box":{"x":45,"y":470,"width":664,"height":13}},{"id":"1280b9fc-f22e-4abc-84b7-0667c7778ac9","block_type":"box","text":"Cybersecurity incidents can result from deliberate attacks or unint","page_number":520,"box":{"x":46,"y":492,"width":457,"height":13}},{"id":"89cc6bd4-2dee-425c-857c-32f855b832f0","block_type":"box","text":"entional events against an issuer in which a Fund invests, a Fund","page_number":520,"box":{"x":504,"y":492,"width":447,"height":13}},{"id":"768388c9-2f10-446d-b646-bd55c9cc843b","block_type":"box","text":"or any of its service providers. They include, but are not limited to, gaining unauthorized access to systems, misappropriating","page_number":520,"box":{"x":46,"y":507,"width":866,"height":13}},{"id":"01cfa466-f8c6-4efb-b0a2-c8aacb3d6209","block_type":"box","text":"assets or sensitive information, corrupting or destroying data, and causing operational disruption. Geopolitical tension may","page_number":520,"box":{"x":46,"y":523,"width":855,"height":13}},{"id":"15d6d492-3f71-4f95-9c58-95ab21493a69","block_type":"box","text":"increase the scale and sophistication of deliberate attacks, partic","page_number":520,"box":{"x":45,"y":538,"width":443,"height":13}},{"id":"83aa5d0d-4afa-46b6-9495-ba45472d8a3e","block_type":"box","text":"ularly those from nation states or from entities with nation state","page_number":520,"box":{"x":489,"y":538,"width":444,"height":13}},{"id":"b213bbe3-b5e1-4858-9d86-7071b5e24172","block_type":"box","text":"backing. Cybersecurity incidents may result in any of the followin","page_number":520,"box":{"x":46,"y":554,"width":455,"height":13}},{"id":"bf1588b3-70e1-43f8-bf30-5244ea49c6a0","block_type":"box","text":"g: financial losses; interference with a Fund’s ability to calculate","page_number":520,"box":{"x":502,"y":554,"width":441,"height":13}},{"id":"cfbcdede-49ea-41c1-9a57-b514ccca148b","block_type":"box","text":"its NAV; disclosure of confidential information; impediment","page_number":520,"box":{"x":45,"y":569,"width":419,"height":13}},{"id":"7d0d545c-20c0-4cca-a509-762b2c583eab","block_type":"box","text":"s to trading; submission of erroneous trades by a Fund or erroneous","page_number":520,"box":{"x":465,"y":569,"width":470,"height":13}},{"id":"2cee4f10-e4f7-4812-a960-6ca19ad78494","block_type":"box","text":"subscription or redemption orders; the inability of a Fund or its serv","page_number":520,"box":{"x":46,"y":585,"width":471,"height":13}},{"id":"7c3c716c-9f78-428c-97ac-86c273f1c2a3","block_type":"box","text":"ice providers to transact business; violations of applicable","page_number":520,"box":{"x":518,"y":585,"width":398,"height":13}},{"id":"2ab73055-90d4-4686-96ec-66dcbe6e7547","block_type":"box","text":"privacy and other laws; regulatory fines; penalties; reputationa","page_number":520,"box":{"x":45,"y":600,"width":434,"height":13}},{"id":"8da91e0b-0292-46f3-86ec-9ad1a75ddac5","block_type":"box","text":"l damage; reimbursement or other compensation costs; and other","page_number":520,"box":{"x":479,"y":600,"width":452,"height":13}},{"id":"235d0442-50ab-4540-9e70-a1bee02c25c6","block_type":"box","text":"legal and compliance expenses. 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Power outages, natural disast","page_number":520,"box":{"x":45,"y":647,"width":384,"height":13}},{"id":"36698a06-3b25-434f-9f94-2ef67ed57403","block_type":"box","text":"ers, equipment malfunctions and processing errors that threaten","page_number":520,"box":{"x":430,"y":647,"width":443,"height":13}},{"id":"61eaf4ff-e5c1-468f-bed7-5cc2af57d5c9","block_type":"box","text":"information and technology systems relied upon by a Fund or its service providers, as well as market events that occur at a pace","page_number":520,"box":{"x":45,"y":662,"width":886,"height":13}},{"id":"048e68a6-24cf-4075-8cdb-4bffb67a1e40","block_type":"box","text":"that overloads these systems, may also disrupt business operations or impact critical data. Recent advances in AI technology pose","page_number":520,"box":{"x":45,"y":678,"width":896,"height":13}},{"id":"529c261c-3583-49b8-b75b-d0e67b97f389","block_type":"box","text":"risks to a Fund and its portfolio investments. 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AI technologies may also allow the unintended introduction of","page_number":521,"box":{"x":46,"y":156,"width":836,"height":13}},{"id":"d370dfb3-cba1-4021-af11-41d5e583af04","block_type":"box","text":"vulnerabilities into infrastructures and applications. To the ex","page_number":521,"box":{"x":45,"y":172,"width":428,"height":13}},{"id":"4689c2b6-1c28-4029-9a10-0d20edc97f8b","block_type":"box","text":"tent that a Fund or its portfolio investments are exposed to the risks","page_number":521,"box":{"x":474,"y":172,"width":470,"height":13}},{"id":"2591512d-b033-41e8-af86-1bfe1941e4ad","block_type":"box","text":"of AI technology use, any such inaccuracies or errors could have adverse impacts on a Fund or its investments.","page_number":521,"box":{"x":46,"y":187,"width":764,"height":13}},{"id":"1a371bb2-c285-409e-af0b-a5034c2a6239","block_type":"box","text":"Regulations related to AI technology could also impose certain ob","page_number":521,"box":{"x":46,"y":209,"width":456,"height":13}},{"id":"8f9e10c2-e002-4150-bdc3-77cb9ccbbbec","block_type":"box","text":"ligations and costs related to monitoring and compliance. 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In","page_number":521,"box":{"x":467,"y":256,"width":406,"height":13}},{"id":"c18d6b54-22f4-4b34-b128-c1d646ec3d38","block_type":"box","text":"October 2023, an executive order established new standards for AI safety and security. 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The full extent of current or future risks related","page_number":521,"box":{"x":489,"y":355,"width":424,"height":13}},{"id":"fc2f1523-16d9-4042-a80b-61a4fcf836c9","block_type":"box","text":"thereto is not possible to predict, and a Fund may not be able to an","page_number":521,"box":{"x":45,"y":371,"width":466,"height":12}},{"id":"90a8184f-9235-4477-bee5-45bcbcca29d8","block_type":"box","text":"ticipate, prevent, mitigate, or remediate all of the potential","page_number":521,"box":{"x":511,"y":371,"width":405,"height":12}},{"id":"1baed175-445e-4953-b8bd-734d74ab064c","block_type":"box","text":"risks, challenges, or impacts of such changes.","page_number":521,"box":{"x":45,"y":386,"width":311,"height":13}},{"id":"14f7b506-7dce-4636-8f6e-24c739738a71","block_type":"box","text":"While each Fund’s service providers are required to have appropr","page_number":521,"box":{"x":45,"y":408,"width":453,"height":13}},{"id":"211205ce-1803-4e52-b67d-7a5d95c2dbc2","block_type":"box","text":"iate operational, information security and cybersecurity risk","page_number":521,"box":{"x":499,"y":408,"width":414,"height":13}},{"id":"00f40515-f5eb-40a2-9e55-60e430aea08e","block_type":"box","text":"management policies and procedures, their methods of risk management may differ from those of a Fund in the setting of","page_number":521,"box":{"x":45,"y":424,"width":843,"height":12}},{"id":"05c9a9d5-ad5b-4ac1-90ec-02a33c0d93f5","block_type":"box","text":"priorities, the personnel and resources available or the effectiveness of relevant controls. 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Such a right is generally denoted as a fixed price put. 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Repurchase agreements may be entered into only with a member","page_number":521,"box":{"x":483,"y":737,"width":458,"height":13}},{"id":"3a3a9907-bdd9-4344-818f-8be6404ac283","block_type":"box","text":"bank of the Federal Reserve System or primary dealer in U.S. Government securities or an affiliate thereof that meets the","page_number":521,"box":{"x":46,"y":753,"width":834,"height":13}},{"id":"3fc8f339-d5a9-488d-a1c9-3050bf453440","block_type":"box","text":"creditworthiness standards adopted by the Manager. 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One","page_number":521,"box":{"x":483,"y":846,"width":447,"height":13}},{"id":"b286760e-4c84-45d9-9206-ee908169a3cc","block_type":"box","text":"common type of repurchase agreement a Fund may enter into is a “tr","page_number":521,"box":{"x":45,"y":861,"width":480,"height":13}},{"id":"bba3c4bd-dd32-4777-bf48-deeee389f8b3","block_type":"box","text":"i-party” repurchase agreement. In “tri-party” repurchase","page_number":521,"box":{"x":526,"y":861,"width":394,"height":13}},{"id":"b2e0a8dc-c903-4e80-87e7-7acebb763157","block_type":"box","text":"agreements, an unaffiliated third party custodian maintains accounts to hold collateral for the Fund and its counterparties and,","page_number":521,"box":{"x":46,"y":877,"width":878,"height":13}},{"id":"c204e269-ac7d-402e-a20e-935b0c68b0dd","block_type":"box","text":"II-11","page_number":521,"box":{"x":482,"y":917,"width":33,"height":9}},{"id":"da99f440-79e4-4919-92e2-94dd525768a2","block_type":"box","text":"NM1026U-6004382-521/605","page_number":521,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"1072bf71-4906-4730-a8d8-5e77d34d0bfd","block_type":"box","text":"therefore, the Fund may be subject to the credit risk of those custodians. In any repurchase transaction to which a Fund is a party,","page_number":522,"box":{"x":45,"y":79,"width":901,"height":12}},{"id":"72abe836-6045-48d8-a65e-6b03b1c51acd","block_type":"box","text":"collateral for a repurchase agreement may include cash items and obligations issued by the U.S. Government or its agencies or","page_number":522,"box":{"x":45,"y":94,"width":873,"height":13}},{"id":"88ef84e5-856e-40c5-98dc-6c98411a9d1d","block_type":"box","text":"instrumentalities. Collateral, however, is not limited to the foregoi","page_number":522,"box":{"x":45,"y":109,"width":458,"height":13}},{"id":"6ecf9d34-fd03-4657-a1c0-10ed07851a46","block_type":"box","text":"ng and may include, for example, obligations rated below the","page_number":522,"box":{"x":504,"y":109,"width":426,"height":13}},{"id":"5c2d07be-e74c-4ad3-86aa-7cabbfa3a1b1","block_type":"box","text":"highest category by NRSROs, including collateral that may be below investment grade. Collateral for a repurchase agreement may","page_number":522,"box":{"x":45,"y":125,"width":906,"height":13}},{"id":"e42fdc0a-8403-4dcf-bbcc-01ebabd40a45","block_type":"box","text":"also include securities that a Fund could not hold directly without the repurchase obligation. Irrespective of the type of collateral","page_number":522,"box":{"x":46,"y":140,"width":889,"height":13}},{"id":"b875e63c-045c-4e2a-8934-ae4c1dd0c195","block_type":"box","text":"underlying the repurchase agreement, the Fund must determin","page_number":522,"box":{"x":46,"y":156,"width":430,"height":12}},{"id":"f77a5231-c456-466e-abc0-e760898358a0","block_type":"box","text":"e that a repurchase obligation with a particular counterparty","page_number":522,"box":{"x":477,"y":156,"width":420,"height":12}},{"id":"fdf17cab-04f1-4e83-b131-61b7470ebb81","block_type":"box","text":"involves minimal credit risk to the Fund and otherwise satisfie","page_number":522,"box":{"x":45,"y":171,"width":430,"height":10}},{"id":"40c598fc-0d94-412b-8cef-2e498b535481","block_type":"box","text":"s any additional credit quality standards applicable to the Fund.","page_number":522,"box":{"x":476,"y":171,"width":441,"height":13}},{"id":"0031df9c-df5a-45b0-b8bc-d3dc2ee65409","block_type":"box","text":"In the event of default by the seller under a repurchase agreement construed to be a collateralized loan, the underlying securities","page_number":522,"box":{"x":45,"y":192,"width":884,"height":13}},{"id":"71a91791-ad0f-4b1f-a290-5ef19378bdc0","block_type":"box","text":"are not owned by the Fund but only constitute collateral for the seller’s obligation to pay the repurchase price. Therefore, a Fund","page_number":522,"box":{"x":46,"y":208,"width":893,"height":12}},{"id":"979a6b9f-ef87-48fe-90bf-207519812eaa","block_type":"box","text":"may suffer time delays and incur costs or possible losses in c","page_number":522,"box":{"x":45,"y":223,"width":417,"height":13}},{"id":"7f89a663-bf8f-4eeb-a0b6-eed5a0cb66fa","block_type":"box","text":"onnection with the disposition of the collateral. In the event of a","page_number":522,"box":{"x":462,"y":223,"width":444,"height":13}},{"id":"1ff63681-15bd-4e23-9625-a764d01ad5ed","block_type":"box","text":"default under a repurchase agreement that is construed to be a collateralized loan, instead of the contractual fixed rate of return,","page_number":522,"box":{"x":46,"y":238,"width":888,"height":13}},{"id":"26893ba2-390b-4e55-b084-5a511946a77b","block_type":"box","text":"the rate of return to a Fund will depend upon intervening fluctuations of the market value of such security and the accrued interest","page_number":522,"box":{"x":45,"y":254,"width":906,"height":13}},{"id":"362b252e-a0c2-4aca-b876-b3cd7beac5ad","block_type":"box","text":"on the security. In such event, a Fund would have rights against the seller for breach of contract with respect to any losses arising","page_number":522,"box":{"x":46,"y":269,"width":893,"height":13}},{"id":"63c7c2a5-d86c-47af-ab57-2d77c9c1d83f","block_type":"box","text":"from market fluctuations following the failure of the seller to p","page_number":522,"box":{"x":45,"y":284,"width":436,"height":13}},{"id":"ba85de37-9026-4f1b-af8d-81cc96ea1667","block_type":"box","text":"erform. In general, for Federal income tax purposes, repurchase","page_number":522,"box":{"x":482,"y":284,"width":441,"height":13}},{"id":"69341885-087b-4073-9267-24698afc1771","block_type":"box","text":"agreements are treated as collateralized loans secured by the secu","page_number":522,"box":{"x":46,"y":300,"width":449,"height":13}},{"id":"a22e50a4-4d96-4a09-8b02-0600c11dab56","block_type":"box","text":"rities “sold.” Therefore, amounts earned under such agreements,","page_number":522,"box":{"x":495,"y":300,"width":448,"height":13}},{"id":"7f398fd0-e06e-44e3-9519-018405f9fd62","block_type":"box","text":"even if the underlying securities are tax-exempt securities, will","page_number":522,"box":{"x":46,"y":315,"width":428,"height":13}},{"id":"54b39d1e-f223-4bef-841d-0840ad84b2bb","block_type":"box","text":"not be considered tax-exempt interest. From time to time, a Fund","page_number":522,"box":{"x":479,"y":315,"width":453,"height":13}},{"id":"72e8f959-a396-44d7-aa3c-6f517acdcb69","block_type":"box","text":"also may invest in money market securities pursuant to purchase and","page_number":522,"box":{"x":46,"y":331,"width":477,"height":12}},{"id":"ea1fb1f3-984b-4025-8516-f8b7ee0a55d2","block_type":"box","text":"sale contracts. While purchase and sale contracts are similar","page_number":522,"box":{"x":528,"y":331,"width":416,"height":12}},{"id":"bbdeae54-a5e7-4027-9363-f6f0b0ef0650","block_type":"box","text":"to repurchase agreements, purchase and sale contracts are struct","page_number":522,"box":{"x":45,"y":346,"width":445,"height":13}},{"id":"28f02a9a-c298-4478-9d9d-0158fe194f36","block_type":"box","text":"ured so as to be in substance more like a purchase and sale of the","page_number":522,"box":{"x":490,"y":346,"width":452,"height":13}},{"id":"e151d118-b769-4e4a-af5c-0ad540ed8fa2","block_type":"box","text":"underlying security than is the case with repurchase agreements a","page_number":522,"box":{"x":46,"y":361,"width":451,"height":13}},{"id":"0f4687ad-95d6-4906-91f5-ae051b9da975","block_type":"box","text":"nd, with purchase and sale contracts, the purchaser receives any","page_number":522,"box":{"x":498,"y":361,"width":442,"height":13}},{"id":"17796e99-df9f-4f01-a9ee-4f5263bc77e9","block_type":"box","text":"interest on the security paid during the period of the contract.","page_number":522,"box":{"x":45,"y":377,"width":426,"height":13}},{"id":"175aaceb-919b-40ba-bab7-502cdae69bf9","block_type":"box","text":"Repurchase agreements pose certain risks for a Fund that utilizes them. Such risks are not unique to the Fund but are inherent in","page_number":522,"box":{"x":46,"y":398,"width":889,"height":13}},{"id":"385c87ff-86d4-4520-952c-dd6ee5617daa","block_type":"box","text":"repurchase agreements. The Funds seek to minimize such risks but because of the inherent legal uncertainties involved in","page_number":522,"box":{"x":45,"y":413,"width":835,"height":13}},{"id":"6618fe71-f472-48fc-bf3a-2959f13300d3","block_type":"box","text":"repurchase agreements, such risks cannot be eliminated. Lower","page_number":522,"box":{"x":45,"y":429,"width":437,"height":13}},{"id":"ff0ca5ed-6577-4fef-8c67-088c61c124e0","block_type":"box","text":"quality collateral and collateral with longer maturities may be","page_number":522,"box":{"x":487,"y":429,"width":428,"height":13}},{"id":"8f856543-8d99-4c8b-81f0-e2854fcc0522","block_type":"box","text":"subject to greater price fluctuations than higher quality collateral and collateral with shorter maturities. If the repurchase","page_number":522,"box":{"x":46,"y":444,"width":835,"height":13}},{"id":"115836c6-207e-4198-b927-b054ee673eac","block_type":"box","text":"agreement counterparty were to default, lower quality collateral m","page_number":522,"box":{"x":46,"y":460,"width":461,"height":12}},{"id":"266e12af-9e94-4fda-9c5e-ba9ec604e905","block_type":"box","text":"ay be more difficult to liquidate than higher quality collateral.","page_number":522,"box":{"x":508,"y":460,"width":427,"height":12}},{"id":"9341ca05-7bae-471c-9fa3-9fbdccb4d968","block_type":"box","text":"Should the counterparty default and the amount of collateral not be","page_number":522,"box":{"x":46,"y":475,"width":470,"height":13}},{"id":"6e97cfb7-723b-4d0a-b2cc-8a4528cee1fc","block_type":"box","text":"sufficient to cover the counterparty’s repurchase obligation, a","page_number":522,"box":{"x":521,"y":475,"width":425,"height":13}},{"id":"307a4f89-61bd-4a80-95b1-58c01153eb9d","block_type":"box","text":"Fund would retain the status of an unsecured creditor of the counterparty (","page_number":522,"box":{"x":45,"y":490,"width":520,"height":13}},{"id":"6560709d-53e9-4eab-afb1-425f24e75837","block_type":"box","text":"i.e.","page_number":522,"box":{"x":567,"y":491,"width":18,"height":9}},{"id":"8470538c-750a-4d70-9a8f-61ceda34c041","block_type":"box","text":", the position the Fund would normally be in if it","page_number":522,"box":{"x":587,"y":490,"width":339,"height":13}},{"id":"1ae38c1d-cf2d-4f98-b62b-cd7d7fd1f839","block_type":"box","text":"were to hold, pursuant to its investment policies, other unsecu","page_number":522,"box":{"x":45,"y":506,"width":430,"height":12}},{"id":"6935509a-5f00-4a45-81bb-8e4075cd3519","block_type":"box","text":"red debt securities of the defaulting counterparty) with respect to the","page_number":522,"box":{"x":476,"y":506,"width":475,"height":12}},{"id":"a53e43f6-4214-4c4e-92e2-04196ccf2ab1","block_type":"box","text":"amount of the shortfall. As an unsecured creditor, a Fund would be at risk of losing some or all of the principal and income","page_number":522,"box":{"x":46,"y":521,"width":856,"height":13}},{"id":"f0616481-59d0-4a76-a127-d99ad3245c78","block_type":"box","text":"involved in the transaction.","page_number":522,"box":{"x":45,"y":536,"width":188,"height":10}},{"id":"76c97aa5-37de-4e8e-ac22-fb6afb87d8ec","block_type":"box","text":"Regulations adopted by global prudential regulators require cert","page_number":522,"box":{"x":46,"y":558,"width":445,"height":13}},{"id":"f4036ef1-05d0-4cd8-b0e9-17cc5d4cbcfd","block_type":"box","text":"ain bank-regulated counterparties and certain of their affiliates to","page_number":522,"box":{"x":492,"y":558,"width":452,"height":13}},{"id":"86a3c3eb-4046-47ab-9f95-5a36c49438f9","block_type":"box","text":"include in certain financial contracts, including many repurchase","page_number":522,"box":{"x":45,"y":573,"width":447,"height":13}},{"id":"81f8ab6c-618d-4282-9889-93dbbbfb3544","block_type":"box","text":"agreements and purchase and sale contracts, terms that delay or","page_number":522,"box":{"x":498,"y":573,"width":442,"height":13}},{"id":"5178f56e-54cb-484f-b279-db19c5b6994e","block_type":"box","text":"restrict the rights of counterparties, such as a Fund, to terminate suc","page_number":522,"box":{"x":45,"y":588,"width":472,"height":13}},{"id":"47fb2ac8-41d7-40e5-90c4-f4db013e4073","block_type":"box","text":"h agreements, take foreclosure action, exercise other default","page_number":522,"box":{"x":517,"y":588,"width":415,"height":13}},{"id":"cc09ec01-a93e-4097-98f6-361f6422933b","block_type":"box","text":"rights or restrict transfers of credit support in the event that the counterparty and/or its affiliates are subject to certain types of","page_number":522,"box":{"x":45,"y":604,"width":874,"height":13}},{"id":"3a5ad73d-6004-4ae2-b5af-30cb2e572e2c","block_type":"box","text":"resolution or insolvency proceedings. It is possible that these re","page_number":522,"box":{"x":45,"y":619,"width":436,"height":13}},{"id":"39211682-8974-48e1-90ec-276b5bb0598f","block_type":"box","text":"quirements, as well as potential additional government regulation","page_number":522,"box":{"x":482,"y":619,"width":454,"height":13}},{"id":"b2c16f09-523e-491d-a63f-fb721cbe8bd9","block_type":"box","text":"and other developments in the market, could adversely affect a F","page_number":522,"box":{"x":46,"y":635,"width":448,"height":12}},{"id":"0e97efec-1c15-4aa1-8944-1c6422b5d1b9","block_type":"box","text":"und’s ability to terminate existing repurchase agreements and","page_number":522,"box":{"x":494,"y":635,"width":425,"height":12}},{"id":"eba482b3-c3fa-416e-8458-7f807edfed4f","block_type":"box","text":"purchase and sale contracts or to realize amounts to be received under such agreements. The SEC has also finalized rules that will","page_number":522,"box":{"x":45,"y":650,"width":898,"height":13}},{"id":"d4f66d96-c137-4153-8552-321ca6ccc027","block_type":"box","text":"require certain transactions involving U.S. Treasuries, including","page_number":522,"box":{"x":45,"y":665,"width":440,"height":13}},{"id":"1466558c-3f91-41d6-abec-7e448670219e","block_type":"box","text":"repurchase agreements, to be centrally cleared. Compliance with","page_number":522,"box":{"x":490,"y":665,"width":446,"height":13}},{"id":"b51d7dcf-cc7a-4af9-8a86-bcabd5fa35b4","block_type":"box","text":"these rules is expected to be required by the middle of 2027. Although the impact of these rules on the Funds is difficult to predict,","page_number":522,"box":{"x":45,"y":681,"width":903,"height":13}},{"id":"335bcaf3-5848-4019-b5cd-14a85d617711","block_type":"box","text":"they may reduce the availability or increase the costs of such transactions and may adversely affect a Fund’s performance.","page_number":522,"box":{"x":45,"y":696,"width":842,"height":13}},{"id":"6c2cefa1-7456-493e-8230-6018106253b6","block_type":"box","text":"Reverse Repurchase Agreements.","page_number":522,"box":{"x":45,"y":717,"width":228,"height":13}},{"id":"2358e397-ac04-40d1-9a1e-b1c852b0ea99","block_type":"box","text":"A Fund may enter into reverse repurchase agreements with the same parties with whom it may","page_number":522,"box":{"x":279,"y":717,"width":657,"height":13}},{"id":"ff7bdaff-d802-4587-8b23-a5aa39e6b910","block_type":"box","text":"enter into repurchase agreements. Under a reverse repurchase","page_number":522,"box":{"x":46,"y":733,"width":424,"height":13}},{"id":"76d974a2-55fb-4168-806d-9f4ebde20a5a","block_type":"box","text":"agreement, a Fund sells securities to another party and agrees to","page_number":522,"box":{"x":476,"y":733,"width":442,"height":13}},{"id":"6abee23c-2252-4a89-968c-858b250277fe","block_type":"box","text":"repurchase them at a mutually agreed-upon date and price. Reverse","page_number":522,"box":{"x":45,"y":748,"width":468,"height":13}},{"id":"865f0c16-55a4-4fdb-9fbc-bfebe5593024","block_type":"box","text":"repurchase agreements involve the risk that (i) the market","page_number":522,"box":{"x":518,"y":748,"width":398,"height":13}},{"id":"5e3f250f-fc03-4d44-b80f-043d5f52dba0","block_type":"box","text":"value of the securities retained in lieu of sale by a Fund may decline below the price of the securities the Fund has sold but is","page_number":522,"box":{"x":45,"y":764,"width":859,"height":12}},{"id":"3906d69f-7429-4ad3-92f0-1357fb347e13","block_type":"box","text":"obligated to repurchase and (ii) the price of the securities sold may decline below the price at which the Fund is required to","page_number":522,"box":{"x":46,"y":779,"width":849,"height":13}},{"id":"bde2e165-277f-48b6-adc9-2cbcd24b10d9","block_type":"box","text":"repurchase them. In addition, if the buyer of securities under a reverse repurchase agreement files for bankruptcy or becomes","page_number":522,"box":{"x":45,"y":794,"width":864,"height":13}},{"id":"dda5550a-0edc-4f3e-b1c5-5252c2159259","block_type":"box","text":"insolvent, such buyer or its trustee or receiver may receive an","page_number":522,"box":{"x":45,"y":810,"width":422,"height":12}},{"id":"79998711-b0a6-46c9-8b23-b93920b76fe4","block_type":"box","text":"extension of time to determine whether to enforce a Fund’s","page_number":522,"box":{"x":472,"y":810,"width":409,"height":10}},{"id":"ce98a8b4-2d06-41b5-91ba-5eeeef323308","block_type":"box","text":"obligations to repurchase the securities and the Fund’s use of the proceeds of the reverse repurchase agreement may effectively be","page_number":522,"box":{"x":46,"y":825,"width":893,"height":13}},{"id":"002cfda6-a73d-419b-be71-4c8eedafccea","block_type":"box","text":"restricted pending such decision.","page_number":522,"box":{"x":45,"y":840,"width":224,"height":13}},{"id":"2b083689-64d6-4261-8b84-87e7c4658730","block_type":"box","text":"Additionally, regulations adopted by global prudential regulator","page_number":522,"box":{"x":45,"y":862,"width":446,"height":13}},{"id":"c10cff1a-b059-4837-a913-65b67a4a3700","block_type":"box","text":"s require certain bank-regulated counterparties and certain of their","page_number":522,"box":{"x":492,"y":862,"width":460,"height":13}},{"id":"b5582f30-9ffd-4b5c-8e8a-221ac989fce5","block_type":"box","text":"affiliates to include in certain financial contracts, including many reverse repurchase agreements, terms that delay or restrict the","page_number":522,"box":{"x":46,"y":877,"width":881,"height":13}},{"id":"c23d3edc-0829-467d-aae6-56d4ddf176db","block_type":"box","text":"II-12","page_number":522,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"ada74dd4-cf8c-4c53-a27f-1fbf75b6b06c","block_type":"box","text":"NM1026U-6004382-522/605","page_number":522,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"7952f698-f74f-41c8-9f3e-c114d46db286","block_type":"box","text":"rights of counterparties, such as a Fund, to terminate such agreemen","page_number":523,"box":{"x":45,"y":79,"width":473,"height":13}},{"id":"48fa6def-13fe-4d5a-9371-e0d5642160e3","block_type":"box","text":"ts, take foreclosure action, exercise other default rights or","page_number":523,"box":{"x":519,"y":79,"width":398,"height":13}},{"id":"43c4ecbc-3e40-44fe-97fa-420ce0a325c7","block_type":"box","text":"restrict transfers of credit support in the event that the counterparty and/or its affiliates are subject to certain types of resolution or","page_number":523,"box":{"x":45,"y":94,"width":904,"height":13}},{"id":"c4ba4319-1472-4a9b-8e33-9249fff45dd6","block_type":"box","text":"insolvency proceedings. It is possible that these requirements","page_number":523,"box":{"x":45,"y":110,"width":419,"height":13}},{"id":"6c430608-5dce-40cf-b43f-20ac57459a5b","block_type":"box","text":", as well as potential additional government regulation and other","page_number":523,"box":{"x":465,"y":110,"width":449,"height":13}},{"id":"59ec29e2-44da-4384-90ef-7569b415e3fd","block_type":"box","text":"developments in the market, could adversely affect a Fund’s ab","page_number":523,"box":{"x":46,"y":125,"width":435,"height":13}},{"id":"2f76a177-a171-41b3-88f7-008dcc08d001","block_type":"box","text":"ility to terminate existing reverse repurchase agreements or to","page_number":523,"box":{"x":482,"y":125,"width":426,"height":13}},{"id":"8f15bce2-a0df-46ac-a008-4ecb2d162ebc","block_type":"box","text":"realize amounts to be received under such agreements. The SEC has also finalized rules that will require certain transactions","page_number":523,"box":{"x":45,"y":141,"width":858,"height":13}},{"id":"d1080e8f-f625-41f2-8f3f-fed67d59f21b","block_type":"box","text":"involving U.S. Treasuries, including reverse repurchase agreements","page_number":523,"box":{"x":45,"y":156,"width":461,"height":13}},{"id":"62030c15-c071-4cd0-ac5a-4b2ed14f1d98","block_type":"box","text":", to be centrally cleared. Compliance with these rules is expected","page_number":523,"box":{"x":507,"y":156,"width":445,"height":13}},{"id":"3ddf7cf5-8be1-4365-87ef-d7a4b3a86046","block_type":"box","text":"to be required by the middle of 2027. Although the impact of these rules on the Funds is difficult to predict, they may reduce the","page_number":523,"box":{"x":45,"y":172,"width":891,"height":13}},{"id":"46bfbfe9-bb4b-42ed-82c7-f32728b3ffde","block_type":"box","text":"availability or increase the costs of such transactions and may adversely affect a Fund’s performance.","page_number":523,"box":{"x":46,"y":187,"width":697,"height":13}},{"id":"2fddac31-562f-4601-82b7-702ee1ea72a7","block_type":"box","text":"Rule 2a-7 Requirements.","page_number":523,"box":{"x":45,"y":211,"width":174,"height":12}},{"id":"aa8232e1-9ba0-4cd6-a02a-562d1b97d3ac","block_type":"box","text":"Rule 2a-7 under the Investment Company Act sets forth portfolio maturity, liquidity, diversification and","page_number":523,"box":{"x":225,"y":211,"width":723,"height":12}},{"id":"79218e08-98dc-4484-8723-5b82ce0e5c94","block_type":"box","text":"quality requirements applicable to all money market funds.","page_number":523,"box":{"x":46,"y":226,"width":408,"height":13}},{"id":"2183e6dd-1f16-4f01-96a1-675117e21e1a","block_type":"box","text":"Maturity.","page_number":523,"box":{"x":45,"y":250,"width":65,"height":12}},{"id":"313cff3b-741d-42b4-8974-721155c1c12e","block_type":"box","text":"Each Fund is managed so that the dollar-weighted average maturity of all of its investments will be 60 days or less, and","page_number":523,"box":{"x":116,"y":249,"width":826,"height":13}},{"id":"9c58422f-e510-4370-a921-712e57983587","block_type":"box","text":"the dollar-weighted average life of all of its investments will be 120 days or less. In addition, the Funds will not acquire any","page_number":523,"box":{"x":45,"y":265,"width":854,"height":13}},{"id":"6d0e965e-fc99-427c-a4b1-2f4781a8598b","block_type":"box","text":"instrument with a remaining maturity of greater than 397 days. The “dollar-weighted average maturity” of a Fund is the average","page_number":523,"box":{"x":45,"y":280,"width":895,"height":13}},{"id":"e924a4cf-d83b-442e-86fb-662eb1e81a6a","block_type":"box","text":"amount of time until the issuers of the debt securities in the F","page_number":523,"box":{"x":46,"y":296,"width":422,"height":10}},{"id":"64ebbcab-0c6b-4c24-b734-496163fd4dbf","block_type":"box","text":"und’s portfolio must pay off the principal amount of the debt.","page_number":523,"box":{"x":469,"y":296,"width":428,"height":13}},{"id":"5c08102b-1db5-4d50-9e66-a481ea459c92","block_type":"box","text":"“Dollar-weighted” means the larger the dollar value of a debt security based on its market value in a Fund, the more weight it gets","page_number":523,"box":{"x":47,"y":311,"width":903,"height":13}},{"id":"cfd5ad55-c81c-40e2-81be-7491700eed15","block_type":"box","text":"in calculating this average. To calculate the dollar-weighted","page_number":523,"box":{"x":45,"y":327,"width":412,"height":13}},{"id":"58883ff6-b364-4e5c-96d4-c4579f957992","block_type":"box","text":"average maturity, the Fund may treat a variable or floating rate","page_number":523,"box":{"x":462,"y":327,"width":439,"height":13}},{"id":"52282c25-8adb-4278-94c2-d18e270dd946","block_type":"box","text":"security under certain circumstances as having a maturity equal t","page_number":523,"box":{"x":46,"y":342,"width":448,"height":13}},{"id":"c4bf3ba6-66ca-4020-a262-08e66b40f209","block_type":"box","text":"o the time remaining to the security’s next interest rate reset date","page_number":523,"box":{"x":495,"y":342,"width":448,"height":13}},{"id":"721015c5-8528-431f-91cf-ab8323c0718c","block_type":"box","text":"or the period remaining until the principal amount can be recovered","page_number":523,"box":{"x":46,"y":358,"width":471,"height":13}},{"id":"51b6735a-6962-437f-a13c-3572689d27b6","block_type":"box","text":"through demand rather than the security’s actual maturity.","page_number":523,"box":{"x":522,"y":358,"width":406,"height":13}},{"id":"e79412ee-9ead-4210-acab-3ffbefdcb9cd","block_type":"box","text":"“Dollar-weighted average life” of a Fund’s portfolio is calcul","page_number":523,"box":{"x":47,"y":373,"width":419,"height":13}},{"id":"2e950ee4-99ea-4060-ae50-83a61143e0f8","block_type":"box","text":"ated without reference to the exceptions used in calculating the","page_number":523,"box":{"x":467,"y":373,"width":436,"height":13}},{"id":"06d47f2a-3b0a-405c-8040-73abf6d581be","block_type":"box","text":"dollar-weighted average maturity for variable or floating rate securities regarding the use of interest rate reset dates.","page_number":523,"box":{"x":46,"y":389,"width":799,"height":13}},{"id":"0ec2e2e7-1ce8-47e1-808b-301b0cede15b","block_type":"box","text":"Liquidity.","page_number":523,"box":{"x":45,"y":412,"width":67,"height":13}},{"id":"982ec7ea-5520-4e10-b73f-8c3b1f559bbc","block_type":"box","text":"Rule 2a-7 contains a “general liquidity requirement” that","page_number":523,"box":{"x":119,"y":412,"width":398,"height":13}},{"id":"a6acbbca-c99d-4fa7-8beb-7df7db7108cf","block_type":"box","text":"requires that each Fund hold securities that are sufficiently","page_number":523,"box":{"x":521,"y":412,"width":405,"height":13}},{"id":"8e887387-be9a-43a4-93c3-201f0ddd181d","block_type":"box","text":"liquid to meet reasonably foreseeable shareholder redemptions","page_number":523,"box":{"x":45,"y":428,"width":433,"height":12}},{"id":"b3a2acf8-4fe9-4641-a6d1-cf121a604fd7","block_type":"box","text":"in light of its obligations under section 22(e) of the Investment","page_number":523,"box":{"x":484,"y":428,"width":431,"height":12}},{"id":"cabeceda-569f-498d-a9b9-875a2d6026d4","block_type":"box","text":"Company Act, and any commitments the Fund has made to sharehol","page_number":523,"box":{"x":46,"y":443,"width":478,"height":13}},{"id":"91a14af7-0ad0-45a0-8627-3cea54969893","block_type":"box","text":"ders. To comply with this general liquidity requirement, each","page_number":523,"box":{"x":524,"y":443,"width":423,"height":13}},{"id":"7e99cdb0-4055-454e-943c-f50990cf6b6a","block_type":"box","text":"Fund’s adviser or sub-adviser must consider factors that could affe","page_number":523,"box":{"x":45,"y":459,"width":454,"height":10}},{"id":"0f3200fe-8eae-4ec4-ba72-de59c678670d","block_type":"box","text":"fect the Fund’s liquidity needs, including characteristics of the","page_number":523,"box":{"x":499,"y":459,"width":421,"height":12}},{"id":"90b6a1ee-2318-4d9a-a369-128094ee9b66","block_type":"box","text":"Fund’s investors and their likely redemptions. Depending","page_number":523,"box":{"x":45,"y":474,"width":396,"height":13}},{"id":"5785b6d3-3513-42e2-b7cc-5f141cfacbe5","block_type":"box","text":"upon the volatility of its cash flows (particularly shareholder","page_number":523,"box":{"x":446,"y":474,"width":419,"height":13}},{"id":"c9dcdbc7-8a66-415d-9545-444c8141ab94","block_type":"box","text":"redemptions), this provision may require a Fund to maintain g","page_number":523,"box":{"x":45,"y":490,"width":433,"height":12}},{"id":"8fa27452-cb4c-45c1-9e30-f26231438edb","block_type":"box","text":"reater liquidity than would be required by the daily and weekly","page_number":523,"box":{"x":478,"y":490,"width":439,"height":12}},{"id":"f89b69c0-0c9a-4340-8a45-17b100c16c38","block_type":"box","text":"minimum liquidity requirements discussed below. The Funds will","page_number":523,"box":{"x":45,"y":505,"width":453,"height":13}},{"id":"1ea2f49e-7ffb-47ad-b31f-4204fded507a","block_type":"box","text":"not acquire any security other than daily liquid assets unless,","page_number":523,"box":{"x":503,"y":505,"width":419,"height":13}},{"id":"76b85d56-3536-4976-b37f-e45a9cb0d12b","block_type":"box","text":"immediately following such purchase, at least 25% of its total assets would be invested in daily liquid assets. The Funds will not","page_number":523,"box":{"x":45,"y":521,"width":888,"height":12}},{"id":"aaba9bee-fa5a-4ff6-8607-ddc27b506e42","block_type":"box","text":"acquire any security other than weekly liquid assets unless, immediately following such purchase, at least 50% of its total assets","page_number":523,"box":{"x":46,"y":536,"width":884,"height":13}},{"id":"a247171b-87a3-4291-accb-c70b094d92fe","block_type":"box","text":"would be invested in weekly liquid assets. “Daily Liquid Assets” in","page_number":523,"box":{"x":45,"y":552,"width":464,"height":12}},{"id":"9b375bb1-061c-452a-8d20-d6a0a9fc4ac5","block_type":"box","text":"clude (i) cash; (ii) direct obligations of the U.S. Government;","page_number":523,"box":{"x":509,"y":552,"width":417,"height":12}},{"id":"5594907c-0558-4b82-9c9e-f4071b44891e","block_type":"box","text":"(iii) securities that will mature, as determined without reference to the maturity shortening provisions of Rule 2a-7 regarding","page_number":523,"box":{"x":46,"y":567,"width":862,"height":13}},{"id":"bdecdec8-780f-4ff2-89fa-7ef0d6909bbe","block_type":"box","text":"interest rate readjustments, or are subject to a demand featu","page_number":523,"box":{"x":45,"y":583,"width":416,"height":12}},{"id":"e8bdb274-15d3-46ac-9255-fcbec27b5bb2","block_type":"box","text":"re that is exercisable and payable within one business day; and","page_number":523,"box":{"x":461,"y":583,"width":434,"height":12}},{"id":"af6ace6b-bc2b-4d89-875a-2a3653ebf4dc","block_type":"box","text":"(iv) amounts receivable and due unconditionally within one business day on pending sales of portfolio securities. “Weekly Liquid","page_number":523,"box":{"x":46,"y":598,"width":894,"height":13}},{"id":"0e7872d1-839a-4691-b86f-cc855960b911","block_type":"box","text":"Assets” include (i) cash; (ii) direct obligations of the U.S. G","page_number":523,"box":{"x":45,"y":614,"width":408,"height":12}},{"id":"452714e1-1328-44e7-b4a4-a3aa431bc560","block_type":"box","text":"overnment; (iii) U.S. Government securities issued by a person","page_number":523,"box":{"x":454,"y":614,"width":430,"height":12}},{"id":"cd89a012-201b-4a06-949c-cdfad3fd1411","block_type":"box","text":"controlled or supervised by and acting as an instrumentality of the U.S. Government pursuant to authority granted by the U.S.","page_number":523,"box":{"x":45,"y":629,"width":875,"height":13}},{"id":"7957120f-dbee-47b2-bee5-c2c65f383aec","block_type":"box","text":"Congress, that are issued at a discount to the principal amount to be repaid at maturity without provision for the payment of","page_number":523,"box":{"x":46,"y":645,"width":867,"height":12}},{"id":"e014e2db-7676-4087-b887-d48ecf6232d0","block_type":"box","text":"interest and have a remaining maturity of 60 days or less; (iv)","page_number":523,"box":{"x":45,"y":660,"width":425,"height":13}},{"id":"5a2b60a1-5f25-47aa-80e6-599dc77b5939","block_type":"box","text":"securities that will mature, as determined without reference to the","page_number":523,"box":{"x":476,"y":660,"width":454,"height":12}},{"id":"f478ddcc-bf8f-468d-b584-768f8afd8dba","block_type":"box","text":"maturity shortening provisions of Rule 2a-7 regarding interest rate readjustments, or are subject to a demand feature that is","page_number":523,"box":{"x":45,"y":676,"width":856,"height":12}},{"id":"e17fa8ab-19f4-439f-8a82-cde4ca3b0a32","block_type":"box","text":"exercisable and payable within five business days; and (v) am","page_number":523,"box":{"x":46,"y":691,"width":423,"height":13}},{"id":"fe9e5311-faec-495d-b95b-d52681b7fc02","block_type":"box","text":"ounts receivable and due unconditionally within five business days on","page_number":523,"box":{"x":470,"y":691,"width":483,"height":13}},{"id":"520f464e-18fb-476c-899c-68dadb5f4dec","block_type":"box","text":"pending sales of portfolio securities. No Fund will invest more than 5% of the value of its total assets in securities that are illiquid","page_number":523,"box":{"x":45,"y":707,"width":898,"height":12}},{"id":"813411f2-da23-43b4-9c99-8dcfd0f0391e","block_type":"box","text":"(","page_number":523,"box":{"x":46,"y":723,"width":3,"height":12}},{"id":"9d7cbee1-2de8-43f7-b15f-2955ec6a7c25","block_type":"box","text":"i.e.","page_number":523,"box":{"x":51,"y":723,"width":18,"height":9}},{"id":"f8214cf2-4d61-4bbc-82c7-57e1f294cfed","block_type":"box","text":", securities that cannot be sold or disposed of in the ordinary course of business within seven days at approximately the value","page_number":523,"box":{"x":71,"y":722,"width":866,"height":13}},{"id":"531fff9b-2315-4d41-92d3-5890585707b4","block_type":"box","text":"ascribed to them by the Fund).","page_number":523,"box":{"x":46,"y":738,"width":211,"height":12}},{"id":"f79971ba-6707-4582-8565-089b75fc6319","block_type":"box","text":"Portfolio Diversification and Quality.","page_number":523,"box":{"x":45,"y":761,"width":261,"height":13}},{"id":"ab42c5ce-a67d-46bc-8a40-707956534a13","block_type":"box","text":"Immediately after the acquisition of any security, taxable money market funds must not","page_number":523,"box":{"x":313,"y":761,"width":608,"height":13}},{"id":"c0cb72df-5a47-455d-bf98-e9807d78da80","block_type":"box","text":"have invested more than: Five percent of its total assets in securitie","page_number":523,"box":{"x":45,"y":776,"width":460,"height":13}},{"id":"846115f8-2889-43b2-9c37-9375c7ff488d","block_type":"box","text":"s issued by the issuer of the security, provided, however, such a","page_number":523,"box":{"x":506,"y":776,"width":436,"height":13}},{"id":"2aa96c07-21cb-45d9-b533-d4fcca21c148","block_type":"box","text":"fund may invest up to twenty-five percent of its total assets in the securities of a single issuer for a period of up to three business","page_number":523,"box":{"x":45,"y":792,"width":885,"height":13}},{"id":"e70a8a3a-0fb9-45f7-9a4c-bb745065a085","block_type":"box","text":"days after the acquisition thereof; provided, further, that th","page_number":523,"box":{"x":46,"y":807,"width":409,"height":13}},{"id":"f89327e1-1cd4-4c95-a6f3-f7ab3cd29af8","block_type":"box","text":"e fund may not invest in the securities of more than one issuer in","page_number":523,"box":{"x":456,"y":807,"width":446,"height":13}},{"id":"897d8232-250c-4d76-96af-3b6c7bd9af77","block_type":"box","text":"accordance with the foregoing proviso at any time; and ten percen","page_number":523,"box":{"x":46,"y":823,"width":458,"height":13}},{"id":"b5d6580c-52f3-4cb8-9a44-260c9b5d64e1","block_type":"box","text":"t of its total assets in securities issued by or subject to demand","page_number":523,"box":{"x":505,"y":823,"width":428,"height":13}},{"id":"225a867f-2a07-4c75-a999-cba07ae5fa23","block_type":"box","text":"features or guarantees from the institution that issued the demand feature or guarantee.","page_number":523,"box":{"x":45,"y":838,"width":605,"height":13}},{"id":"f0bbf9de-d1f5-4988-bc4e-3fa53f5cb71b","block_type":"box","text":"Government Money Market Funds.","page_number":523,"box":{"x":46,"y":862,"width":246,"height":13}},{"id":"2e0e65a9-b6b7-4b45-a839-f5c8e5fc22c5","block_type":"box","text":"A government money market fund invests at least 99.5% of its total assets in obligations of","page_number":523,"box":{"x":298,"y":862,"width":634,"height":13}},{"id":"ed935973-95b2-4b73-93c9-0f7b6b78dc34","block_type":"box","text":"the U.S. Government, including obligations of the U.S. Treasury and federal agencies and instrumentalities, as well as repurchase","page_number":523,"box":{"x":45,"y":877,"width":892,"height":13}},{"id":"091a0a32-e065-44b9-8387-03445907fd21","block_type":"box","text":"II-13","page_number":523,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"d2b6fcc4-80aa-4ed9-be49-9f4f4f49de9c","block_type":"box","text":"NM1026U-6004382-523/605","page_number":523,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4d5d8423-1a6d-4cb5-a6f5-07aaaae5a9f8","block_type":"box","text":"agreements collateralized by government securities. Under Rule 2a-7, a government money market fund may, but is not required","page_number":524,"box":{"x":46,"y":79,"width":891,"height":13}},{"id":"864e9d73-91a3-45cd-b931-e4d007cebf43","block_type":"box","text":"to, impose discretionary liquidity fees. The Board of Trustees has determined that each Fund that is a government money market","page_number":524,"box":{"x":45,"y":94,"width":893,"height":13}},{"id":"0e2a1f79-fed7-4207-90fd-85e4da8ba89d","block_type":"box","text":"fund will not be subject to discretionary liquidity fees under Rule 2a-7.","page_number":524,"box":{"x":45,"y":110,"width":490,"height":13}},{"id":"99d2c263-c9a4-42ef-912b-6c4e2d6f9161","block_type":"box","text":"Retail Money Market Funds.","page_number":524,"box":{"x":45,"y":133,"width":200,"height":13}},{"id":"5f9ca829-7abf-456d-b61c-32963b7f4285","block_type":"box","text":"A retail money market fund is a money market fund that has policies and procedures reasonably","page_number":524,"box":{"x":251,"y":133,"width":668,"height":13}},{"id":"374ee5d3-9a98-4b71-acfb-71c112ca28fc","block_type":"box","text":"designed to limit all beneficial owners of the fund to natural persons. Under Rule 2a-7, a retail money market fund is subject to the","page_number":524,"box":{"x":46,"y":149,"width":907,"height":12}},{"id":"aac8ee8d-17f4-43c6-be90-94e2011b2a2b","block_type":"box","text":"discretionary liquidity fees provisions; however, a retail mone","page_number":524,"box":{"x":46,"y":164,"width":425,"height":13}},{"id":"18a55090-c723-46a8-a97f-4de3328c7630","block_type":"box","text":"y market fund is permitted to use the amortized cost method of","page_number":524,"box":{"x":472,"y":164,"width":439,"height":13}},{"id":"16db4b73-c889-4361-909d-fbbfc5b9f2da","block_type":"box","text":"accounting or the penny rounding method, allowing a retail money market fund to maintain a stable NAV.","page_number":524,"box":{"x":46,"y":180,"width":743,"height":12}},{"id":"2b7a2a72-855b-4109-ac3a-16ced2b599cd","block_type":"box","text":"Securities Lending.","page_number":524,"box":{"x":46,"y":203,"width":132,"height":13}},{"id":"8c75094a-a4f5-40d6-905a-d539530d2361","block_type":"box","text":"Each Fund may lend portfolio securities to certain borro","page_number":524,"box":{"x":184,"y":203,"width":390,"height":13}},{"id":"93431886-9900-40ee-b2ad-1ac1dbb91e86","block_type":"box","text":"wers that BlackRock determines to be creditworthy,","page_number":524,"box":{"x":575,"y":203,"width":360,"height":13}},{"id":"d902e55f-9be6-426f-9991-6a3d7b20c145","block_type":"box","text":"including borrowers affiliated with BlackRock. The borrowers provide collateral that is maintained in an amount at least equal to","page_number":524,"box":{"x":45,"y":218,"width":901,"height":13}},{"id":"f8cda42c-b995-40e9-ae1c-c7bf237e847f","block_type":"box","text":"the current market value of the securities loaned. No securities loan shall be made on behalf of a Fund if, as a result, the aggregate","page_number":524,"box":{"x":45,"y":234,"width":901,"height":13}},{"id":"b5add1a6-02c0-438b-b25d-c413608402c0","block_type":"box","text":"value of all securities loans of the particular Fund exceeds one-thir","page_number":524,"box":{"x":45,"y":249,"width":459,"height":13}},{"id":"701857b4-c3a7-4411-b190-661724bc1c5c","block_type":"box","text":"d of the value of such Fund’s total assets (including the value of","page_number":524,"box":{"x":505,"y":249,"width":440,"height":13}},{"id":"fe1ce65c-9e58-48bc-aa84-75e9d3ff1210","block_type":"box","text":"the collateral received). A Fund may terminate a loan at any time and obtain the return of the securities loaned. Each Fund","page_number":524,"box":{"x":45,"y":265,"width":850,"height":13}},{"id":"9cc8de0a-b9d6-4727-b50e-d0a5a18a1b25","block_type":"box","text":"receives, by way of substitute payment, the value of any interest or cash or non-cash distributions paid on the loaned securities","page_number":524,"box":{"x":45,"y":280,"width":876,"height":13}},{"id":"5056431c-2c2e-49cc-8299-4d20238d1787","block_type":"box","text":"that it would have otherwise received if the securities were not on loan.","page_number":524,"box":{"x":45,"y":296,"width":493,"height":10}},{"id":"0f4b5a75-10a4-4f36-b5f5-806a6ba979df","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 amount of cash","page_number":524,"box":{"x":45,"y":319,"width":880,"height":13}},{"id":"bb8db223-d524-4080-bc68-adb2590c7911","block_type":"box","text":"collateral. The Funds are compensated by any positive difference between the amount earned on the reinvestment of cash","page_number":524,"box":{"x":45,"y":335,"width":841,"height":12}},{"id":"971536ef-389a-4295-8df2-a726e6f5731e","block_type":"box","text":"collateral and the fee paid to the borrower. In the case of colla","page_number":524,"box":{"x":45,"y":350,"width":431,"height":13}},{"id":"78cf80fb-1ec6-484f-9f0d-7ea4a2c260af","block_type":"box","text":"teral other than cash, a Fund is compensated by a fee paid by the","page_number":524,"box":{"x":477,"y":350,"width":450,"height":13}},{"id":"1df578df-6e68-49b9-be31-d6571eb455c4","block_type":"box","text":"borrower equal to a percentage of the market value of the loaned securities. Any cash collateral received by the Fund for such","page_number":524,"box":{"x":46,"y":366,"width":869,"height":12}},{"id":"85587b88-f947-4c98-8f30-1838354c156f","block_type":"box","text":"loans, and uninvested cash, may be reinvested in certain short-term instruments either directly on behalf of the Fund or through","page_number":524,"box":{"x":45,"y":381,"width":885,"height":13}},{"id":"d5103323-d688-458b-8e5b-8286a53db756","block_type":"box","text":"one or more joint accounts or money market funds, including thos","page_number":524,"box":{"x":46,"y":397,"width":460,"height":12}},{"id":"0f1fa625-b0f7-4c42-b078-eb10c9ef750c","block_type":"box","text":"e affiliated with BlackRock; such investments are subject to","page_number":524,"box":{"x":507,"y":397,"width":411,"height":12}},{"id":"b1fe47b0-30e9-4c0c-85cd-65db30d3369f","block_type":"box","text":"investment risk.","page_number":524,"box":{"x":45,"y":412,"width":109,"height":10}},{"id":"11f63a3d-2110-4b5f-9887-9343bc527eab","block_type":"box","text":"Securities lending involves exposure to certain risks, including operational risk (i.e., the risk of losses resulting from problems in","page_number":524,"box":{"x":46,"y":435,"width":884,"height":13}},{"id":"f6fc981f-9dd6-4d2b-92e0-75d0b83038b1","block_type":"box","text":"the settlement and accounting process), “gap” risk (i.e., the risk of a","page_number":524,"box":{"x":45,"y":451,"width":471,"height":13}},{"id":"895bba93-4583-4e89-8d77-ad61fac4d4f1","block_type":"box","text":"mismatch between the return on cash collateral reinvestments","page_number":524,"box":{"x":522,"y":451,"width":426,"height":10}},{"id":"d6e9292f-ce02-47a5-8b4a-83fa36b96c65","block_type":"box","text":"and the fees each Fund has agreed to pay a borrower), foreign exchange risk (","page_number":524,"box":{"x":46,"y":466,"width":537,"height":13}},{"id":"564fd06b-743a-4c34-ab17-c2f18035052c","block_type":"box","text":"i.e","page_number":524,"box":{"x":585,"y":467,"width":15,"height":9}},{"id":"fb36ea4d-5a13-4d81-84cf-7583099e2b33","block_type":"box","text":"., the risk of a shortfall at default when a cash","page_number":524,"box":{"x":601,"y":466,"width":317,"height":13}},{"id":"1122be9f-3400-47f0-aebc-afa164c6ca4c","block_type":"box","text":"collateral investment is denominated in a currency other than the currency of the assets being loaned due to movements in foreign","page_number":524,"box":{"x":45,"y":482,"width":900,"height":13}},{"id":"6e5183ea-5dcb-435c-a117-fd80555e91a9","block_type":"box","text":"exchange rates), and credit, legal, counterparty and market risks (in","page_number":524,"box":{"x":46,"y":497,"width":468,"height":13}},{"id":"5d30dfdf-6930-4fc5-a89d-b5f21db3f3fb","block_type":"box","text":"cluding the risk that market events, including but not limited to","page_number":524,"box":{"x":514,"y":497,"width":439,"height":13}},{"id":"b4bdb1ec-1520-4af5-a607-02c9a36a2dae","block_type":"box","text":"corporate actions, could lead a Fund to lend securities that are trading at a premium due to increased demand, or to recall loaned","page_number":524,"box":{"x":45,"y":513,"width":897,"height":13}},{"id":"430aed3b-1e5c-491b-875b-a95d1ee38298","block_type":"box","text":"securities or to lend less or none at all, which could lead to reduced securities lending revenue). If a Fund were to lend out","page_number":524,"box":{"x":46,"y":528,"width":841,"height":13}},{"id":"cb8dd8ad-4baf-4e86-8d90-fcbddceba26a","block_type":"box","text":"securities that are subject to a corporate action and commit to the borrower a particular election as determined by the Fund’s","page_number":524,"box":{"x":46,"y":544,"width":867,"height":13}},{"id":"68903026-6c3d-48d8-9669-b8952d565c2d","block_type":"box","text":"investment adviser, the benefit the Fund would receive in respect of committing to such election may or may not be less than the","page_number":524,"box":{"x":45,"y":559,"width":889,"height":13}},{"id":"be803786-f41a-489a-a7d7-2b38315653ab","block_type":"box","text":"benefit the Fund would have received from making a different election in such corporate action. If a securities lending","page_number":524,"box":{"x":46,"y":575,"width":814,"height":13}},{"id":"c535737c-23d1-4fd3-936a-5a424ec46a53","block_type":"box","text":"counterparty were to default, a Fund would be subject to the risk of a possible delay in receiving collateral or in recovering the","page_number":524,"box":{"x":45,"y":590,"width":876,"height":13}},{"id":"43ef6847-b263-496c-8272-e4d946806639","block_type":"box","text":"loaned securities, or to a possible loss of rights in the collateral. In the event a borrower does not return a Fund’s securities as","page_number":524,"box":{"x":45,"y":606,"width":866,"height":13}},{"id":"19ec23d6-ae90-4295-ab5f-85e8e150850e","block_type":"box","text":"agreed, the Fund’s ability to participate in a corporate action event may be impacted, or the Fund may experience losses if the","page_number":524,"box":{"x":46,"y":621,"width":870,"height":13}},{"id":"e31a489c-e473-4d33-98f0-9154f95b9980","block_type":"box","text":"proceeds received from liquidating the collateral do not at least equal the value of the loaned security at the time the collateral is","page_number":524,"box":{"x":45,"y":637,"width":887,"height":13}},{"id":"9a6a2693-7ef1-4837-ba2e-06dbd9611b58","block_type":"box","text":"liquidated, plus the transaction costs incurred in purchasing rep","page_number":524,"box":{"x":45,"y":652,"width":441,"height":13}},{"id":"7f38f13c-95f3-4dbc-a850-2524ec7bff3d","block_type":"box","text":"lacement securities. This latter event could trigger adverse tax","page_number":524,"box":{"x":486,"y":652,"width":426,"height":13}},{"id":"fc9da95b-c1fa-46dd-8667-8ae8e99185a6","block_type":"box","text":"consequences for a Fund. A Fund could lose money if its short-term investment of the collateral declines in value over the period of","page_number":524,"box":{"x":45,"y":668,"width":909,"height":13}},{"id":"3dea838b-653c-4381-9be3-cd6c1bfbd706","block_type":"box","text":"the loan. Substitute payments received by a Fund representing dividends paid on securities loaned out by the Fund will not be","page_number":524,"box":{"x":45,"y":683,"width":869,"height":13}},{"id":"ac5bc967-6cde-431c-9a78-7e1e3d8a74ac","block_type":"box","text":"considered qualified dividend income, and distributions by","page_number":524,"box":{"x":45,"y":699,"width":407,"height":13}},{"id":"7913de39-0263-47c0-b1c9-a72da3c0eddd","block_type":"box","text":"the Fund of such substitute payments will not constitute qualified","page_number":524,"box":{"x":456,"y":699,"width":454,"height":13}},{"id":"53dc953a-72d0-4fb1-886b-8a4f2a73b387","block_type":"box","text":"dividend income. Additionally, substitute payments receive","page_number":524,"box":{"x":46,"y":714,"width":407,"height":13}},{"id":"50f24811-af14-4351-827b-2775560737a2","block_type":"box","text":"d by a Fund representing qualified REIT dividends paid on REIT","page_number":524,"box":{"x":454,"y":714,"width":449,"height":13}},{"id":"9a10adce-42f4-40d7-86ff-307766523431","block_type":"box","text":"securities loaned out by the Fund will not be considered qualified REIT dividends, and distributions by the Fund of such substitute","page_number":524,"box":{"x":46,"y":730,"width":904,"height":13}},{"id":"73a80185-6474-49c2-947d-05e533242e8f","block_type":"box","text":"payments will not be eligible for a 20% deduction currently available for ordinary REIT dividends paid to non-corporate","page_number":524,"box":{"x":45,"y":745,"width":840,"height":13}},{"id":"9ffc8b7d-fdf9-4d8c-aa7f-4eaae81a0eb9","block_type":"box","text":"shareholders provided certain other requirements are satisfied. The securities lending agent will take into account the tax effects on","page_number":524,"box":{"x":46,"y":761,"width":906,"height":13}},{"id":"5425f353-e1c1-44d9-8a28-29220bb1d825","block_type":"box","text":"shareholders caused by these differences in connection with a Fund’","page_number":524,"box":{"x":46,"y":776,"width":467,"height":13}},{"id":"5c5db58d-9c7a-4b6e-8c4a-d51fe9a14004","block_type":"box","text":"s securities lending program. Substitute payments received on","page_number":524,"box":{"x":515,"y":776,"width":425,"height":13}},{"id":"9dc2260a-cd49-4e8e-9d25-9a94c09baacf","block_type":"box","text":"tax-exempt securities loaned out will not be tax-exempt income. There could also be changes in the status of issuers under","page_number":524,"box":{"x":45,"y":792,"width":847,"height":13}},{"id":"13e8a3a0-ac16-4c21-a4d7-27196165e92c","block_type":"box","text":"applicable laws and regulations, including tax regulations, that may impact the regulatory or tax treatment of loaned securities","page_number":524,"box":{"x":46,"y":807,"width":877,"height":13}},{"id":"d1552575-85a0-42d0-be39-4e923d95191b","block_type":"box","text":"and could, for example, result in a delay in the payment of d","page_number":524,"box":{"x":46,"y":823,"width":419,"height":13}},{"id":"49a492e7-dd7f-4a31-8c25-ccea46dc34dd","block_type":"box","text":"ividend equivalent payments owed to a Fund (as permitted by","page_number":524,"box":{"x":465,"y":823,"width":429,"height":13}},{"id":"50f4cff6-6961-46e2-a125-002e2941c76d","block_type":"box","text":"applicable law).","page_number":524,"box":{"x":46,"y":838,"width":108,"height":13}},{"id":"fec74e45-3230-4619-8dc5-6df43067db37","block_type":"box","text":"Regulations adopted by global prudential regulators require cert","page_number":524,"box":{"x":46,"y":862,"width":445,"height":13}},{"id":"e4afb6fb-4a72-459b-9e6c-e7fc8a9c1d8b","block_type":"box","text":"ain bank-regulated counterparties and certain of their affiliates to","page_number":524,"box":{"x":492,"y":862,"width":452,"height":13}},{"id":"d2d8d236-402a-4b91-a857-63e491b0680f","block_type":"box","text":"include in certain financial contracts, including many securitie","page_number":524,"box":{"x":45,"y":877,"width":429,"height":13}},{"id":"d06dcf7a-6421-4807-9e10-bd7c2d28c30a","block_type":"box","text":"s lending agreements, terms that delay or restrict the rights of","page_number":524,"box":{"x":475,"y":877,"width":424,"height":13}},{"id":"9a62e3c2-cd13-4b5f-8734-9f167f1a5448","block_type":"box","text":"II-14","page_number":524,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"9c0e3240-26d1-4000-a14f-ecb6a012d049","block_type":"box","text":"NM1026U-6004382-524/605","page_number":524,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"bf823349-9b68-4a20-bf03-8865aa088b9b","block_type":"box","text":"counterparties, such as the Fund, to terminate such agreements, fo","page_number":525,"box":{"x":45,"y":79,"width":459,"height":13}},{"id":"3e440af5-ce00-4565-9c08-f1e299b749b7","block_type":"box","text":"reclose upon collateral, exercise other default rights or restrict","page_number":525,"box":{"x":505,"y":79,"width":428,"height":13}},{"id":"4d9510db-4dad-4b8d-a23a-c811d1dffef3","block_type":"box","text":"transfers of credit support in the event that the counterparty and/or its affiliates are subject to certain types of resolution or","page_number":525,"box":{"x":45,"y":94,"width":851,"height":13}},{"id":"1ba0982e-2e94-49c0-9b77-4eac03e5a08e","block_type":"box","text":"insolvency proceedings. It is possible that these requirements","page_number":525,"box":{"x":45,"y":110,"width":419,"height":13}},{"id":"045ec395-92fa-49b1-b17b-8f2764472fdc","block_type":"box","text":", as well as potential additional government regulation and other","page_number":525,"box":{"x":465,"y":110,"width":449,"height":13}},{"id":"dd6e7149-32da-48fe-9e8e-218e19d61410","block_type":"box","text":"developments in the market, could adversely affect the Fund’s ab","page_number":525,"box":{"x":46,"y":125,"width":448,"height":13}},{"id":"eba22269-0b74-4c6f-a118-8924e548aca1","block_type":"box","text":"ility to terminate existing securities lending agreements or to","page_number":525,"box":{"x":495,"y":125,"width":417,"height":13}},{"id":"e88ba825-641a-4d1e-815a-17eb437e72ce","block_type":"box","text":"realize amounts to be received under such agreements. Prudential regulation may also favor lenders that can provide additional","page_number":525,"box":{"x":45,"y":141,"width":881,"height":13}},{"id":"3e15e034-c95d-400f-b380-2851954c9fa8","block_type":"box","text":"protections, such as liens that are exercisable in connection with a lender default, to borrowers. Certain Funds expect to provide","page_number":525,"box":{"x":45,"y":156,"width":888,"height":13}},{"id":"784287bf-e4bf-4303-a883-1fc47404adb2","block_type":"box","text":"additional protections to borrowers, where permitted pursuant to a","page_number":525,"box":{"x":46,"y":172,"width":466,"height":13}},{"id":"49e76b05-4f0f-470c-b46b-ebcad80fdf8a","block_type":"box","text":"Fund’s investment policies and if BlackRock believes doing so","page_number":525,"box":{"x":518,"y":172,"width":427,"height":13}},{"id":"3ccc1670-fbe7-4aa4-bfcb-86b67e590f95","block_type":"box","text":"is in the best interest of the Fund.","page_number":525,"box":{"x":45,"y":187,"width":230,"height":10}},{"id":"62fdcbb7-a96d-4b1b-9a8f-e4da80fc6c14","block_type":"box","text":"The SEC has adopted a rule that will require reporting and public disclosure of securities loan transaction information (not","page_number":525,"box":{"x":45,"y":211,"width":853,"height":12}},{"id":"f7f3b0b7-cfdb-47f0-a8ab-4d14aad4fbf9","block_type":"box","text":"including party names); this may include, but is not limited to, in","page_number":525,"box":{"x":45,"y":226,"width":450,"height":13}},{"id":"cae7f2aa-5ac8-4aae-a4cc-775be4cd8160","block_type":"box","text":"formation about securities loans entered into in connection with","page_number":525,"box":{"x":495,"y":226,"width":445,"height":10}},{"id":"7a57c583-f336-4ea7-b150-7e19926388da","block_type":"box","text":"short sales. Compliance with this rule is expected to be required in late 2028, although in response to the outcome of a legal","page_number":525,"box":{"x":46,"y":242,"width":859,"height":12}},{"id":"b4017c23-4eff-4b25-a735-d9754bb531df","block_type":"box","text":"challenge against the rule, the SEC may amend the rule and/or delay the current expected compliance date.","page_number":525,"box":{"x":45,"y":257,"width":739,"height":13}},{"id":"c5d81472-d9a1-4a7a-8937-ca928d72ff63","block_type":"box","text":"Structured Notes.","page_number":525,"box":{"x":46,"y":280,"width":121,"height":10}},{"id":"bdce3012-defc-4c11-82e5-089db124dfd5","block_type":"box","text":"Structured notes and other related instruments purch","page_number":525,"box":{"x":173,"y":280,"width":367,"height":13}},{"id":"f9c4e686-6b78-4ffb-8049-73dbbec52e74","block_type":"box","text":"ased by a Fund are generally privately negotiated debt","page_number":525,"box":{"x":541,"y":280,"width":373,"height":13}},{"id":"a9d0ca10-776e-49cf-a8e1-6b662c13cf6b","block_type":"box","text":"obligations where the principal and/or interest is determined by","page_number":525,"box":{"x":46,"y":296,"width":439,"height":13}},{"id":"4886e895-019c-4ef4-9f48-86e345548de3","block_type":"box","text":"reference to the performance of a specific asset, benchmark asset,","page_number":525,"box":{"x":489,"y":296,"width":451,"height":13}},{"id":"f97adc77-4ffd-403c-bfd0-e938c6168df3","block_type":"box","text":"market or interest rate (“reference measure”). Issuers of structu","page_number":525,"box":{"x":45,"y":311,"width":439,"height":13}},{"id":"aa85515c-9736-4ed1-882a-fe768f28fda5","block_type":"box","text":"red notes generally include corporations and banks. The interest","page_number":525,"box":{"x":484,"y":311,"width":445,"height":13}},{"id":"25fd39c4-b31c-4d8b-8054-7e55a70a3c84","block_type":"box","text":"rate or the principal amount payable upon maturity or redemption may increase or decrease, depending upon changes in the value","page_number":525,"box":{"x":45,"y":327,"width":904,"height":13}},{"id":"4c015289-ae63-4f7b-8f49-c8dd133a04dc","block_type":"box","text":"of the reference measure. The terms of a structured note may provide that, in certain circumstances, no principal is due at maturity","page_number":525,"box":{"x":46,"y":342,"width":905,"height":13}},{"id":"506a0510-31df-4104-bdc3-94a6fb74928e","block_type":"box","text":"and, therefore, may result in a loss of invested capital by a Fund. The interest and/or principal payments that may be made on a","page_number":525,"box":{"x":46,"y":358,"width":884,"height":13}},{"id":"ff1cea18-c57d-4461-bbd4-cec64af8b60a","block_type":"box","text":"structured product may vary widely, depending on a variety of factors, including the volatility of the reference measure.","page_number":525,"box":{"x":46,"y":373,"width":827,"height":13}},{"id":"5d19890f-c5d9-4ffe-b7ad-c34d72370ec1","block_type":"box","text":"Structured notes may be positively or negatively indexed, so the appreciation of the reference measure may produce an increase or","page_number":525,"box":{"x":46,"y":397,"width":901,"height":12}},{"id":"a75a7f42-73a6-4e80-9f4d-bde8a4fe55cc","block_type":"box","text":"a decrease in the interest rate or the value of the principal at maturity. The rate of return on structured notes may be determined","page_number":525,"box":{"x":46,"y":412,"width":887,"height":13}},{"id":"c87ad160-c8cf-4453-bec2-006d082aac8b","block_type":"box","text":"by applying a multiplier to the performance or differential performance of reference measures. Application of a multiplier involves","page_number":525,"box":{"x":46,"y":428,"width":901,"height":12}},{"id":"831908ce-e184-4bd3-a3cb-33c5e5305cd4","block_type":"box","text":"leverage that will serve to magnify the potential for gain and the risk of loss.","page_number":525,"box":{"x":45,"y":443,"width":527,"height":13}},{"id":"1f61d23f-c371-46d9-af9d-81b7b620afbd","block_type":"box","text":"The purchase of structured notes exposes a Fund to the credit risk of the issuer of the structured product. Structured notes may","page_number":525,"box":{"x":45,"y":466,"width":881,"height":13}},{"id":"52c5e562-c7c2-4797-bd1a-73c02174f351","block_type":"box","text":"also be more volatile, less liquid, and more difficult to price accurately than less complex securities and instruments or more","page_number":525,"box":{"x":46,"y":482,"width":857,"height":13}},{"id":"9c1336c6-9445-4175-becb-374d0c55f79b","block_type":"box","text":"traditional debt securities. The secondary market for structured notes could be illiquid making them difficult to sell when the Fund","page_number":525,"box":{"x":45,"y":497,"width":906,"height":13}},{"id":"249d2ba5-b888-432f-b226-3afd5287b549","block_type":"box","text":"determines to sell them. The possible lack of a liquid secondary market for structured notes and the resulting inability of the Fund","page_number":525,"box":{"x":46,"y":513,"width":899,"height":13}},{"id":"733509c9-7164-4ed4-a0ba-5e947885c636","block_type":"box","text":"to sell a structured note could expose the Fund to losses and could make structured notes more difficult for the Fund to value","page_number":525,"box":{"x":45,"y":528,"width":868,"height":13}},{"id":"8b5fff0b-1aad-46de-9036-d6e76e377454","block_type":"box","text":"accurately.","page_number":525,"box":{"x":46,"y":544,"width":73,"height":13}},{"id":"b505eabd-a61d-4a6b-9e9f-993058a34440","block_type":"box","text":"Taxable Money Market Securities.","page_number":525,"box":{"x":46,"y":567,"width":241,"height":13}},{"id":"4985e7e2-0a84-48dc-97e6-d83261ace5a2","block_type":"box","text":"Certain Funds may invest in a variety of taxable money market securities (“Taxable","page_number":525,"box":{"x":294,"y":567,"width":580,"height":13}},{"id":"7d31aec6-d8a2-418d-becf-737a42374cb3","block_type":"box","text":"Securities”). The Taxable Securities in which certain Funds may invest consist of U.S. Government securities, U.S. Government","page_number":525,"box":{"x":46,"y":583,"width":878,"height":12}},{"id":"c93ae4c0-a7f2-4639-ab22-a22f8096c9f3","block_type":"box","text":"agency securities, domestic bank certificates of deposit and bankers’ acceptances, short term corporate debt securities such as","page_number":525,"box":{"x":46,"y":598,"width":865,"height":13}},{"id":"a8d94e75-c8ca-48b5-b0aa-3493dfdc4d81","block_type":"box","text":"commercial paper and repurchase agreements. These investments must have a maturity not in excess of 397 days from the date of","page_number":525,"box":{"x":45,"y":614,"width":901,"height":12}},{"id":"048f49b7-7ab2-4453-8b3f-3a974f7c255a","block_type":"box","text":"purchase.","page_number":525,"box":{"x":45,"y":629,"width":65,"height":13}},{"id":"542e6199-eea8-425f-a33b-7fac81298b44","block_type":"box","text":"The standards applicable to Taxable Securities in which certain Funds invest are essentially the same as those described above with","page_number":525,"box":{"x":45,"y":652,"width":907,"height":13}},{"id":"468b2d64-6d44-4b55-bc27-296b5fd7bff8","block_type":"box","text":"respect to Municipal Securities. Certain Funds may not invest in","page_number":525,"box":{"x":45,"y":668,"width":444,"height":13}},{"id":"0e2204f4-ffce-4290-a4b3-359129ded82b","block_type":"box","text":"any security issued by a depository institution unless such","page_number":525,"box":{"x":494,"y":668,"width":398,"height":13}},{"id":"fa757060-37ec-4dfe-b2b5-5b94cf8e6358","block_type":"box","text":"institution is organized and operating in the United States, has t","page_number":525,"box":{"x":45,"y":683,"width":441,"height":13}},{"id":"ac86252a-b723-4099-8a4b-49bce189c724","block_type":"box","text":"otal assets of at least $1 billion and is federally insured. Taxable","page_number":525,"box":{"x":486,"y":683,"width":443,"height":13}},{"id":"66f75118-1356-443e-b6f5-5228452d29db","block_type":"box","text":"Securities in which the Funds invest will be determined by the","page_number":525,"box":{"x":46,"y":699,"width":426,"height":13}},{"id":"938769ea-2671-45d4-abec-3148dee9cdee","block_type":"box","text":"Manager to present minimal credit risks to the Fund, if required,","page_number":525,"box":{"x":477,"y":699,"width":447,"height":13}},{"id":"7cd5870c-ce0d-4260-80b7-70c074492e1f","block_type":"box","text":"and certain Funds may require that portfolio investments (or their issuers) receive minimum credit ratings from one or more","page_number":525,"box":{"x":46,"y":714,"width":858,"height":13}},{"id":"7b7db14b-ea55-43ff-92f9-2ae5d52973c6","block_type":"box","text":"NRSROs, or if not rated, are determined by the Manager to be of comparable quality to securities that have received such","page_number":525,"box":{"x":45,"y":730,"width":846,"height":13}},{"id":"c6acaa45-6276-4d01-ba5c-4908a988c0a3","block_type":"box","text":"rating(s).","page_number":525,"box":{"x":45,"y":746,"width":61,"height":12}},{"id":"e66c484f-12f0-4119-aa0d-abe605fb1fcd","block_type":"box","text":"U.S. Government Obligations.","page_number":525,"box":{"x":46,"y":769,"width":212,"height":13}},{"id":"8dfe07bc-e9db-4223-9656-bcf73074bfbf","block_type":"box","text":"A Fund may purchase obligations issued or guaranteed by the U.S. Government and U.S.","page_number":525,"box":{"x":264,"y":769,"width":616,"height":13}},{"id":"c9108682-9315-4b09-911c-56728900f0d7","block_type":"box","text":"Government agencies and instrumentalities. Obligations of certai","page_number":525,"box":{"x":46,"y":784,"width":449,"height":13}},{"id":"bc5be142-1ae0-478c-a85a-f3d400c10f9b","block_type":"box","text":"n agencies and instrumentalities of the U.S. Government are","page_number":525,"box":{"x":496,"y":784,"width":415,"height":13}},{"id":"418bab82-0753-45ef-9cdf-07427d3bea2d","block_type":"box","text":"supported by the full faith and credit of the U.S. Treasury. Others are supported by the right of the issuer to borrow from the U.S.","page_number":525,"box":{"x":46,"y":800,"width":899,"height":13}},{"id":"e2d3ad31-daa4-42eb-8656-2a97cbf6e6d3","block_type":"box","text":"Treasury; and still others are supported only by the credit of the agency or instrumentality issuing the obligation. No assurance","page_number":525,"box":{"x":45,"y":815,"width":880,"height":13}},{"id":"7b287e1d-a392-43c2-af1f-78e5b4959853","block_type":"box","text":"can be given that the U.S. Government will provide financial support to U.S. Government-sponsored instrumentalities if it is not","page_number":525,"box":{"x":45,"y":831,"width":888,"height":13}},{"id":"29113d65-1ee7-4bc3-a520-464a37e03a2e","block_type":"box","text":"obligated to do so by law. Certain U.S. Treasury and agency securities may be held by trusts that issue participation certificates","page_number":525,"box":{"x":46,"y":846,"width":879,"height":13}},{"id":"fe19abfb-6a76-4795-a73e-db58532b31cc","block_type":"box","text":"(such as Treasury income growth receipts and certificates of accrual on Treasury certificates). These certificates, as well as","page_number":525,"box":{"x":46,"y":862,"width":843,"height":13}},{"id":"20589ed6-88de-43ee-a0f0-7224b12a66d9","block_type":"box","text":"Treasury receipts and other stripped securities, represent benefic","page_number":525,"box":{"x":45,"y":877,"width":444,"height":13}},{"id":"56879f0e-7b28-415d-a29a-ad2e34358910","block_type":"box","text":"ial ownership interests in either fu","page_number":525,"box":{"x":490,"y":877,"width":235,"height":13}},{"id":"2d563e75-3fab-40b3-a67f-6765068cafc4","block_type":"box","text":"ture interest payments or the","page_number":525,"box":{"x":725,"y":877,"width":199,"height":13}},{"id":"9af5cf15-c305-42f1-9c79-c1d909958064","block_type":"box","text":"II-15","page_number":525,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"2105d23c-5abf-4f61-923d-7f7870a60292","block_type":"box","text":"NM1026U-6004382-525/605","page_number":525,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a0bf089c-c76b-45e3-9fb7-830d77deb0e5","block_type":"box","text":"future principal payments on U.S. Government obligations. Th","page_number":526,"box":{"x":45,"y":79,"width":436,"height":12}},{"id":"53775c8e-583c-43c1-b51a-acf0bc39dfb6","block_type":"box","text":"ese instruments are issued at a discount to their “face value” and","page_number":526,"box":{"x":481,"y":79,"width":449,"height":10}},{"id":"85d1fbc9-5aea-4fb2-bf4b-83c132e496ae","block_type":"box","text":"may (particularly in the case of stripped mortgage-backed securities) exhibit greater price volatility than ordinary debt securities","page_number":526,"box":{"x":45,"y":94,"width":885,"height":13}},{"id":"f4d0a264-a9b8-44f4-ab12-37202d3efc45","block_type":"box","text":"because of the manner in which their principal and interest are returned to investors.","page_number":526,"box":{"x":46,"y":109,"width":585,"height":13}},{"id":"f441bd03-5dc7-44e0-bb5c-c3bb7c7e5ed2","block_type":"box","text":"Examples of the types of U.S. Government obligations that may be held by certain Funds include U.S. Treasury Bills, Treasury","page_number":526,"box":{"x":45,"y":131,"width":875,"height":13}},{"id":"f4593657-f0c6-4c19-90ca-d7884aaaf0ca","block_type":"box","text":"Notes and Treasury Bonds and the obligations of the Federal Housing Administration, Farmers Home Administration, Export","page_number":526,"box":{"x":45,"y":147,"width":883,"height":12}},{"id":"5fe1723b-c929-4a1e-905e-c70678e5829d","block_type":"box","text":"Import Bank of the United States, Small Business Administration, the Government National Mortgage Association (“Ginnie","page_number":526,"box":{"x":45,"y":162,"width":860,"height":13}},{"id":"b0c15f04-7441-47b2-a782-b8a1d7d7d646","block_type":"box","text":"Mae”), the Federal National Mortgage Association (“Fannie Mae","page_number":526,"box":{"x":45,"y":177,"width":457,"height":13}},{"id":"e635dfa2-5b96-46a1-9332-25db148d8f45","block_type":"box","text":"”), Federal Financing Bank, General Services Administration,","page_number":526,"box":{"x":504,"y":177,"width":421,"height":13}},{"id":"6df03f8a-8402-405e-8df1-c0023e66830b","block_type":"box","text":"The Co-operative Central Bank, Federal Home Loan Banks, the Federal Home Loan Mortgage Corporation (“Freddie Mac”),","page_number":526,"box":{"x":45,"y":193,"width":876,"height":12}},{"id":"50f6ee74-53b2-4c40-8ba2-bea756763f12","block_type":"box","text":"Farm Credit System and Tennessee Valley Authority. Certain Funds may also invest in mortgage-related securities issued or","page_number":526,"box":{"x":45,"y":208,"width":855,"height":13}},{"id":"f818ac73-82a2-47b7-8b55-6648fb5fd637","block_type":"box","text":"guaranteed by U.S. Government agencies and instrumentaliti","page_number":526,"box":{"x":45,"y":223,"width":421,"height":13}},{"id":"6eaa41aa-53c9-4d4e-8ce3-40b7cf905e5c","block_type":"box","text":"es, including such obligations of Ginnie Mae, Fannie Mae and","page_number":526,"box":{"x":467,"y":223,"width":431,"height":13}},{"id":"2e7464c1-cd46-4ed7-9ba2-5fddb965798f","block_type":"box","text":"Freddie Mac.","page_number":526,"box":{"x":45,"y":239,"width":91,"height":10}},{"id":"07924a8e-f6aa-4090-94eb-5d42e2063689","block_type":"box","text":"To the extent consistent with their respective investment objectives, the Funds may invest in a variety of U.S. Treasury obligations","page_number":526,"box":{"x":45,"y":261,"width":899,"height":12}},{"id":"c50ae6ca-d324-484f-a3ed-8b3bf57b4c12","block_type":"box","text":"and obligations issued by or guaranteed by the U.S. Government or its agencies, instrumentalities or U.S. Government sponsored","page_number":526,"box":{"x":46,"y":276,"width":892,"height":13}},{"id":"422b5272-74a2-4624-a227-eac6d4ccce01","block_type":"box","text":"enterprises. Treasury obligations may differ in their interest rat","page_number":526,"box":{"x":46,"y":291,"width":434,"height":13}},{"id":"33405d7e-a3b4-4be5-b392-580f5a63f2ac","block_type":"box","text":"es, maturities, times of issuance and other characteristics.","page_number":526,"box":{"x":481,"y":291,"width":394,"height":13}},{"id":"e374799e-8fbe-4534-8bfa-0f1ee947628c","block_type":"box","text":"Obligations of U.S. Government agencies and authorities are supported by varying degrees of credit but generally are not backed","page_number":526,"box":{"x":46,"y":307,"width":892,"height":12}},{"id":"ef03c29c-e131-4215-943c-a0b58c1ba625","block_type":"box","text":"by the full faith and credit of the U.S. Government. No assurance can be given that the U.S. Government would provide financial","page_number":526,"box":{"x":46,"y":322,"width":895,"height":13}},{"id":"e3994030-d066-48d4-a9da-8bb880c1bcb6","block_type":"box","text":"support to its agencies, instrumentalities or U.S. Government sponsored enterprises if it were not obligated to do so by law. There","page_number":526,"box":{"x":46,"y":337,"width":898,"height":13}},{"id":"1ab577f5-5ccd-4042-9137-3b89bcd7b06c","block_type":"box","text":"is no assurance that these commitments will","page_number":526,"box":{"x":45,"y":353,"width":305,"height":10}},{"id":"d4497542-3070-4b6b-8256-25ccc8f9132e","block_type":"box","text":"be undertaken or complied with in the future.","page_number":526,"box":{"x":355,"y":353,"width":316,"height":13}},{"id":"c1e605fb-27ab-4fb8-9e62-6f74203dc721","block_type":"box","text":"In addition, certain Funds may invest in U.S. Treasury Floating Rat","page_number":526,"box":{"x":45,"y":375,"width":466,"height":12}},{"id":"c9fa509c-ea7e-403b-8f88-822d7609a142","block_type":"box","text":"e Notes (FRNs), which are two-year notes issued by the U.S.","page_number":526,"box":{"x":512,"y":375,"width":418,"height":12}},{"id":"6d7553c6-6abe-460f-9dd4-780d50ed70ce","block_type":"box","text":"Treasury. The interest rate of an FRN changes over the life of the FRN and is the sum of an index rate and a spread. The index","page_number":526,"box":{"x":45,"y":390,"width":882,"height":13}},{"id":"f9a36ae1-abe6-4063-839f-642c10666eb7","block_type":"box","text":"rate of an FRN is tied to the highest accepted discount rate of the most recent 13-week Treasury bill and is re-set every week. The","page_number":526,"box":{"x":45,"y":405,"width":898,"height":13}},{"id":"9538b119-da02-45ad-94c4-de5ee1191cf1","block_type":"box","text":"spread is a rate applied to the index rate. The spread stays the same for the life of an FRN. The spread is determined at the auction","page_number":526,"box":{"x":46,"y":421,"width":905,"height":13}},{"id":"50d44289-3189-4ba1-963b-410a40450e53","block_type":"box","text":"where the FRN is first offered. The spread is the highest accepted di","page_number":526,"box":{"x":45,"y":436,"width":469,"height":13}},{"id":"8d7adc71-7d20-4f74-b093-44fdeb1b86fa","block_type":"box","text":"scount margin in that auction. See also “Variable and Floating","page_number":526,"box":{"x":515,"y":436,"width":433,"height":13}},{"id":"61d4cff3-f184-4839-8d5c-0b58c2593d5e","block_type":"box","text":"Rate Instruments” below.","page_number":526,"box":{"x":46,"y":451,"width":177,"height":11}},{"id":"bfab3950-fb26-4c28-9dc9-daf3645ed8c1","block_type":"box","text":"Variable and Floating Rate Instruments.","page_number":526,"box":{"x":45,"y":473,"width":284,"height":13}},{"id":"7f6ad423-a022-4eb7-80f5-f9f42f82f7cf","block_type":"box","text":"Certain Funds may purchase variable and floating rate instruments. Variable and","page_number":526,"box":{"x":335,"y":473,"width":562,"height":13}},{"id":"1466b8c6-7b40-4683-9189-129436a44899","block_type":"box","text":"floating rate instruments are subject to the credit quality standards described in the Prospectus. In some cases, the Funds may","page_number":526,"box":{"x":45,"y":489,"width":867,"height":12}},{"id":"9b80665f-b69b-46b2-af3c-605ad187f59d","block_type":"box","text":"require that the obligation to pay the principal of the instrumen","page_number":526,"box":{"x":45,"y":504,"width":441,"height":13}},{"id":"7f2ba504-81ea-41a3-a479-3b602a1618fc","block_type":"box","text":"t be backed by a letter of credit or guarantee. Such instruments","page_number":526,"box":{"x":486,"y":504,"width":435,"height":13}},{"id":"21020536-a999-41f7-a074-aa00ab625501","block_type":"box","text":"may carry stated maturities in excess of 397 days provided that the maturity-shortening provisions stated in Rule 2a-7 are","page_number":526,"box":{"x":45,"y":519,"width":845,"height":13}},{"id":"fda54fc1-b082-46f7-96dd-04ece37979be","block_type":"box","text":"satisfied. Although a particular variable or floating rate demand instrument may not be actively traded in a secondary market, in","page_number":526,"box":{"x":46,"y":535,"width":891,"height":13}},{"id":"86f8ee04-a3e3-420b-b292-019be1779f5e","block_type":"box","text":"some cases, a Fund may be entitled to principal on demand and may be able to resell such notes in the dealer market.","page_number":526,"box":{"x":46,"y":550,"width":810,"height":13}},{"id":"b6e20778-7efb-43a5-aff2-874cb0dd92dd","block_type":"box","text":"Variable and floating rate instruments held by a Fund generally","page_number":526,"box":{"x":45,"y":572,"width":440,"height":13}},{"id":"3b3d83c5-e94c-48c3-9623-c814ab02c556","block_type":"box","text":"may have maturities of more than 397 days provided: (i) they are","page_number":526,"box":{"x":489,"y":572,"width":452,"height":13}},{"id":"eccbafe0-83b0-4d88-9a97-9307e0120c03","block_type":"box","text":"subject to a demand feature entitling the Fund to the payment o","page_number":526,"box":{"x":46,"y":587,"width":441,"height":13}},{"id":"c0d02d8c-8f31-49c6-bdf8-c24d730e6eb6","block_type":"box","text":"f principal and interest within 397 days of exercise, unless the","page_number":526,"box":{"x":488,"y":587,"width":426,"height":13}},{"id":"20c62bb8-9017-4ed8-8aa9-4d5f9bd2275d","block_type":"box","text":"instrument is issued or guaranteed by the U.S. Government or its agencies and/or instrumentalities, and (ii) the rate of interest on","page_number":526,"box":{"x":45,"y":603,"width":892,"height":12}},{"id":"03915610-ab45-4ad2-97c5-8f77dbfca733","block_type":"box","text":"such instruments is adjusted at periodic intervals which may extend up to 397 days.","page_number":526,"box":{"x":46,"y":618,"width":579,"height":13}},{"id":"7699e955-c3a1-4c8a-bbe0-e086d8609df9","block_type":"box","text":"In determining a Fund’s weighted average portfolio maturity an","page_number":526,"box":{"x":45,"y":640,"width":431,"height":13}},{"id":"7755d4a9-0c41-4f14-803b-baa436f43b94","block_type":"box","text":"d whether a long-term variable rate demand instrument has a","page_number":526,"box":{"x":477,"y":640,"width":415,"height":13}},{"id":"3fdf7fe3-094c-44c1-a6f4-462576158519","block_type":"box","text":"remaining maturity of 397 days or less, the instrument will be deemed by a Fund to have a maturity equal to the longer of the period","page_number":526,"box":{"x":45,"y":655,"width":899,"height":13}},{"id":"cc9a69a2-1408-439d-b15d-426dd9415b0c","block_type":"box","text":"remaining until its next interest rate adjustment or the period remai","page_number":526,"box":{"x":45,"y":671,"width":456,"height":12}},{"id":"462f778b-9308-4333-a736-5fdd6309b48c","block_type":"box","text":"ning until the principal amount can be recovered through demand.","page_number":526,"box":{"x":502,"y":671,"width":450,"height":12}},{"id":"a208c8f5-d33e-4b49-9e9d-947776c45a43","block_type":"box","text":"In determining a Fund’s weighted average portfolio maturity an","page_number":526,"box":{"x":45,"y":686,"width":431,"height":13}},{"id":"b1dbee89-6bef-41bc-89b5-bc73c98286b0","block_type":"box","text":"d whether a long-term floating rate demand instrument has a","page_number":526,"box":{"x":477,"y":686,"width":413,"height":13}},{"id":"55da17d3-37a3-41b8-ad3b-43e3020e6a13","block_type":"box","text":"remaining maturity of 397 days or less, the instrument will be deemed by a Fund to have a maturity equal to the period remaining","page_number":526,"box":{"x":45,"y":701,"width":881,"height":13}},{"id":"bff2402b-5d8d-4648-a6b2-d55a17e2999d","block_type":"box","text":"until the principal amount can be recovered through demand. In additi","page_number":526,"box":{"x":46,"y":717,"width":478,"height":12}},{"id":"6df85049-1253-4d34-aab7-c2e50bac6e5d","block_type":"box","text":"on, a variable or floating rate instrument issued or guaranteed","page_number":526,"box":{"x":525,"y":717,"width":419,"height":12}},{"id":"734bf9af-d77d-4265-9df7-f321eb9e3287","block_type":"box","text":"by the U.S. Government or its agencies and/or instrumentalities will be deemed by a Fund to have a maturity equal to the period","page_number":526,"box":{"x":46,"y":732,"width":867,"height":13}},{"id":"3b91f9b4-9af5-45c0-9e97-2397b5d16390","block_type":"box","text":"remaining until its next interest rate adjustment (in the case of a var","page_number":526,"box":{"x":45,"y":747,"width":457,"height":13}},{"id":"bc2c3251-dfdb-4382-a79e-fe8d296b83bc","block_type":"box","text":"iable rate instrument) or one day (in the case of a floating rate","page_number":526,"box":{"x":503,"y":747,"width":418,"height":13}},{"id":"6d2615d4-def3-4910-8e3b-5d4ac96df72d","block_type":"box","text":"instrument). Variable and floating rate notes are frequently rate","page_number":526,"box":{"x":45,"y":763,"width":430,"height":13}},{"id":"ee84b2d4-897e-4a2e-bfac-32e6953506dc","block_type":"box","text":"d by credit rating agencies, and their issuers must satisfy the Fund’s","page_number":526,"box":{"x":476,"y":763,"width":453,"height":13}},{"id":"a1414245-abfd-4807-8af4-4f194c633bdd","block_type":"box","text":"quality and maturity requirements. If an issuer of such a note were to default on its payment obligation, the Fund might be unable to","page_number":526,"box":{"x":46,"y":778,"width":898,"height":13}},{"id":"1cdc3c8e-1904-42f0-9a2b-262056b2a2bb","block_type":"box","text":"dispose of the note because of the absence of an active secondary market and might, for this or other reasons, suffer a loss.","page_number":526,"box":{"x":46,"y":794,"width":827,"height":12}},{"id":"c36e5488-bd2e-4765-993f-dd3635d1091b","block_type":"box","text":"When-Issued Securities, Delayed Delivery Securities and Forward Commitments.","page_number":526,"box":{"x":45,"y":815,"width":571,"height":13}},{"id":"307bf542-03fd-49d6-9c37-5554d5c70eb1","block_type":"box","text":"A Fund may purchase or sell securities that it is","page_number":526,"box":{"x":622,"y":815,"width":326,"height":13}},{"id":"752f3f4c-4406-45bb-80d9-2e528682e2a3","block_type":"box","text":"entitled to receive on a when-issued basis. A Fund may also purchase or sell securities on a delayed delivery basis or through a","page_number":526,"box":{"x":46,"y":831,"width":872,"height":12}},{"id":"1756c898-764e-4d9a-821f-06c4e5416d45","block_type":"box","text":"forward commitment (including on a “TBA” (to be announced) basis).","page_number":526,"box":{"x":45,"y":846,"width":491,"height":13}},{"id":"2794cae3-c619-428a-aa74-bfb7274d3560","block_type":"box","text":"These transactions involve the purchase or sale of securities","page_number":526,"box":{"x":541,"y":846,"width":411,"height":13}},{"id":"74f26e88-f028-4f36-88ba-f468417dfcd0","block_type":"box","text":"by a Fund at an established price with payment and delivery taking place in the future. The Fund enters into these transactions to","page_number":526,"box":{"x":46,"y":861,"width":894,"height":13}},{"id":"3e646d7b-ad2d-4342-b051-0602c4dee171","block_type":"box","text":"obtain what is considered an advantageous price to the Fund at the time of entering into the transaction.","page_number":526,"box":{"x":46,"y":877,"width":722,"height":13}},{"id":"3c2cd7ce-520f-4a55-9fef-15421a019a6b","block_type":"box","text":"II-16","page_number":526,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"bb3df97d-0388-450c-a236-f082625318f4","block_type":"box","text":"NM1026U-6004382-526/605","page_number":526,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"fc4f9f73-1087-4594-ba31-e3109cf4307d","block_type":"box","text":"Pursuant to recommendations of the Treasury Market Practices Group, which is sponsored by the Federal Reserve Bank of New","page_number":527,"box":{"x":45,"y":79,"width":891,"height":13}},{"id":"1133cefd-9c01-48ee-bf6f-a9396081048f","block_type":"box","text":"York, a Fund or its counterparty generally will be required to post collateral when entering into certain forward-settling","page_number":527,"box":{"x":45,"y":94,"width":831,"height":13}},{"id":"b8904f95-b478-4f39-b79d-08c727947bf1","block_type":"box","text":"transactions, including without limitation TBA transactions.","page_number":527,"box":{"x":45,"y":110,"width":417,"height":13}},{"id":"f5c6437c-111b-4935-a562-3b8aedc97649","block_type":"box","text":"There can be no assurance that a security purchased on a when-issu","page_number":527,"box":{"x":45,"y":133,"width":469,"height":12}},{"id":"b60d2779-ae65-4f9b-8eac-fb4260eaef36","block_type":"box","text":"ed basis will be issued or that a security purchased or sold on a","page_number":527,"box":{"x":515,"y":133,"width":436,"height":12}},{"id":"9bb17cd3-71f8-4043-8a86-cd8d090ae042","block_type":"box","text":"delayed delivery basis or through a forward commitment will be delivered. Also, the value of securities in these transactions on the","page_number":527,"box":{"x":46,"y":148,"width":903,"height":13}},{"id":"a883554e-b796-420a-9bce-ad3076767909","block_type":"box","text":"delivery date may be more or less than the price paid by the Fund to purchase the securities. 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Failure of such party to do so may result in the Fund’s incurring a loss or missing an opportunity to obtain a price","page_number":527,"box":{"x":45,"y":287,"width":834,"height":13}},{"id":"d49d2f1f-8db5-4f77-9d84-bab6f4577472","block_type":"box","text":"considered to be advantageous.","page_number":527,"box":{"x":45,"y":302,"width":216,"height":13}},{"id":"4a7b0743-a8bb-4625-a447-bfd15cbeb5c8","block_type":"box","text":"The market value of the securities underlying a commitment to pu","page_number":527,"box":{"x":45,"y":325,"width":459,"height":13}},{"id":"22eb8daa-78b7-4f5c-9e67-32a16a3f77e5","block_type":"box","text":"rchase securities, and any subsequent fluctuations in their","page_number":527,"box":{"x":504,"y":325,"width":398,"height":13}},{"id":"faab9b0d-dd4e-465c-93bf-6f84de37eb5b","block_type":"box","text":"market value, is taken into account when determining the market value of a Fund starting on the day the Fund agrees to purchase","page_number":527,"box":{"x":45,"y":341,"width":899,"height":13}},{"id":"25c8bc46-fd42-426b-b255-6c06082588ca","block_type":"box","text":"the securities. 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It is possible that these new","page_number":527,"box":{"x":45,"y":457,"width":886,"height":12}},{"id":"601a3111-d14f-4b07-95f1-7d61a2108f65","block_type":"box","text":"requirements, as well as potential additional government regulation and other developments in the market, could adversely affect a","page_number":527,"box":{"x":45,"y":472,"width":908,"height":13}},{"id":"704dad19-433e-4e7b-9697-7cb42db9fd8c","block_type":"box","text":"Fund’s ability to terminate existing agreements with respect to th","page_number":527,"box":{"x":45,"y":488,"width":450,"height":12}},{"id":"039dee74-d14b-4e66-9267-b337444d2d4e","block_type":"box","text":"ese transactions or to realize amounts to be received under such","page_number":527,"box":{"x":496,"y":488,"width":440,"height":10}},{"id":"be8f1a95-6d27-4c73-ad95-e893e4938ee4","block_type":"box","text":"agreements.","page_number":527,"box":{"x":46,"y":506,"width":80,"height":10}},{"id":"f7360c84-7436-4186-98d8-dfca7f82fc0b","block_type":"box","text":"Diversification Status","page_number":527,"box":{"x":45,"y":533,"width":155,"height":10}},{"id":"6ba5f5f8-d746-4dc8-a332-6321a244ec1b","block_type":"box","text":"Each Fund’s investments will be limited in order to allow the Fund to continue to qualify as a regulated investment company","page_number":527,"box":{"x":45,"y":556,"width":865,"height":13}},{"id":"ead340ec-602c-4fed-94e3-15f3347649eb","block_type":"box","text":"under the Code. To qualify, among other requirements, each Fund will limit its investments so that at the close of each quarter of","page_number":527,"box":{"x":46,"y":572,"width":897,"height":13}},{"id":"e020dd5f-4009-47e8-82fc-e5c96d5d1007","block_type":"box","text":"the taxable year (i) at least 50% of the market value of each Fund’s total assets is represented by cash, securities of other regulated","page_number":527,"box":{"x":45,"y":587,"width":903,"height":13}},{"id":"8b6e7b85-7960-4562-beab-452cb931ca2c","block_type":"box","text":"investment companies, U.S. Government securities and other","page_number":527,"box":{"x":45,"y":603,"width":421,"height":13}},{"id":"63da4f65-d7c6-469c-a41f-22013328799b","block_type":"box","text":"securities, with such other securities limited, in respect of any one","page_number":527,"box":{"x":472,"y":603,"width":452,"height":13}},{"id":"601a9616-582e-41b7-afaa-fde7bcf71d88","block_type":"box","text":"issuer, to an amount not greater than 5% of the Fund’s assets and not greater than 10% of the outstanding voting securities of","page_number":527,"box":{"x":45,"y":618,"width":879,"height":13}},{"id":"ad2f4374-331f-4fc1-a74c-a8ad0902f8f1","block_type":"box","text":"such issuer and (ii) not more than 25% of the value of its assets is invested in the securities (other than U.S. Government securities","page_number":527,"box":{"x":46,"y":634,"width":900,"height":12}},{"id":"d054f685-d230-4955-95b4-c1640dafe53a","block_type":"box","text":"or securities of other regulated investment companies) of any one","page_number":527,"box":{"x":46,"y":649,"width":451,"height":13}},{"id":"79af5a32-d714-4eb1-ac64-2ad61478b46f","block_type":"box","text":"issuer, any two or more issuers that the Fund controls and that","page_number":527,"box":{"x":502,"y":649,"width":435,"height":13}},{"id":"530d66dd-882a-46ba-af82-05b60dcb59d0","block_type":"box","text":"are determined to be engaged in the same or similar trades or businesses or related trades or businesses or in the securities of one","page_number":527,"box":{"x":46,"y":665,"width":889,"height":13}},{"id":"cb0417d6-9f8f-43bc-a37f-721de8c703d2","block_type":"box","text":"or more qualified publicly traded partnerships (","page_number":527,"box":{"x":46,"y":680,"width":327,"height":13}},{"id":"04931f3c-a845-421a-8281-299290e72e59","block_type":"box","text":"i.e.","page_number":527,"box":{"x":375,"y":681,"width":18,"height":9}},{"id":"f1cdb2b8-59c6-4d19-bb8c-fdfb807185e5","block_type":"box","text":", partnerships that are traded on an established securities market or tradable on","page_number":527,"box":{"x":396,"y":680,"width":549,"height":13}},{"id":"8f3e31b5-df79-44bb-be79-de716ea23b03","block_type":"box","text":"a secondary market, other than partnerships that derive 90% of their income from interest, dividends, capital gains, and other","page_number":527,"box":{"x":46,"y":696,"width":874,"height":13}},{"id":"1a57f6f2-c729-48e6-9d6a-521ec3b7239b","block_type":"box","text":"traditional permitted mutual fund income). See “Dividends and Taxes — Taxes.”","page_number":527,"box":{"x":45,"y":711,"width":564,"height":13}},{"id":"7309401e-6c2e-45a0-bfac-6c328d7548f3","block_type":"box","text":"Each Fund has elected to be classified as “diversified” under the Investment Company Act. Each Fund must also satisfy the","page_number":527,"box":{"x":45,"y":734,"width":852,"height":13}},{"id":"c6f1d63a-51bc-4c96-a6c0-4f58195fcec2","block_type":"box","text":"diversification requirements set forth in Rule 2a-7.","page_number":527,"box":{"x":46,"y":750,"width":348,"height":13}},{"id":"d4d04f69-821d-41d6-bb22-1115ade7ace3","block_type":"box","text":"M","page_number":527,"box":{"x":302,"y":781,"width":16,"height":9}},{"id":"95532e10-3e70-486f-8d67-c650105f2239","block_type":"box","text":"ANAGEMENT AND","page_number":527,"box":{"x":319,"y":783,"width":129,"height":7}},{"id":"1f651358-2773-4414-9e23-2b9f5b937ae1","block_type":"box","text":"O","page_number":527,"box":{"x":454,"y":781,"width":12,"height":9}},{"id":"f37f6f9e-ca9e-481a-ba7b-91d0480e73b1","block_type":"box","text":"THER","page_number":527,"box":{"x":467,"y":783,"width":39,"height":7}},{"id":"c5c794c8-5c46-488f-b1f0-df4e55ec03ce","block_type":"box","text":"S","page_number":527,"box":{"x":512,"y":781,"width":7,"height":9}},{"id":"908f861f-c7af-42fa-a651-12d825816a69","block_type":"box","text":"ERVICE","page_number":527,"box":{"x":520,"y":783,"width":50,"height":7}},{"id":"e00a8c8e-f778-4abe-8db3-ec9f1b566fae","block_type":"box","text":"A","page_number":527,"box":{"x":575,"y":780,"width":12,"height":10}},{"id":"7295243e-0e0e-4cc8-bf60-4b3e49e6e3e8","block_type":"box","text":"RRANGEMENTS","page_number":527,"box":{"x":588,"y":783,"width":109,"height":7}},{"id":"007ad503-47f8-4c39-8e4c-132b513d6d06","block_type":"box","text":"Trustees and Officers","page_number":527,"box":{"x":45,"y":805,"width":155,"height":10}},{"id":"d42babe7-1485-441a-ab98-02be70d6abe0","block_type":"box","text":"See “Information on Directors and Officers, ‘—Biographical Information,’ ‘— Share Ownership’ and ‘— Compensation of","page_number":527,"box":{"x":46,"y":831,"width":851,"height":12}},{"id":"3b14f00e-9374-4d47-93c0-98b3f2807374","block_type":"box","text":"Directors’” or “Information on Trustees and Officers, ‘—Biogra","page_number":527,"box":{"x":45,"y":846,"width":445,"height":13}},{"id":"73938a6d-bcce-451f-a253-795a6d2299d3","block_type":"box","text":"phical Information,’ ‘— Share Ownership’ and ‘— Compensation","page_number":527,"box":{"x":491,"y":846,"width":455,"height":13}},{"id":"936c6ea7-1762-49ec-ab0d-6f65c6145acb","block_type":"box","text":"of Trustees’,” as applicable, in Part I of each Fund’s SAI for biographical and certain other information relating to the Trustees","page_number":527,"box":{"x":46,"y":862,"width":878,"height":12}},{"id":"6b00cbc4-0716-410b-965e-e82c775f966e","block_type":"box","text":"and officers of your Fund, including Trustees’ compensation.","page_number":527,"box":{"x":46,"y":877,"width":421,"height":13}},{"id":"51599db1-53ff-4070-b504-bba6a7a9402a","block_type":"box","text":"II-17","page_number":527,"box":{"x":482,"y":917,"width":35,"height":9}},{"id":"f543a879-ce1f-4dfa-89ab-fddfe07cc75c","block_type":"box","text":"NM1026U-6004382-527/605","page_number":527,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"89f3f6e9-e6fd-4cbf-851e-74287c7980bd","block_type":"box","text":"Management Arrangements","page_number":528,"box":{"x":45,"y":79,"width":201,"height":13}},{"id":"bb8ae891-35e7-47bf-9764-2511d076aece","block_type":"box","text":"Management Services.","page_number":528,"box":{"x":45,"y":105,"width":153,"height":12}},{"id":"3cbf8692-2b4f-48f4-a132-e1ff82be703b","block_type":"box","text":"The Manager provides each Fund with investment advisory and management services. Subject to the","page_number":528,"box":{"x":204,"y":105,"width":697,"height":12}},{"id":"50daa510-b732-41aa-a414-13aa30a17237","block_type":"box","text":"supervision of the Board of Trustees, the Manager is responsible for the actual management of a Fund’s portfolio and reviews the","page_number":528,"box":{"x":46,"y":120,"width":896,"height":13}},{"id":"a05233b3-9063-4ba8-9a70-f63735c90c76","block_type":"box","text":"Fund’s holdings in light of its own research analysis and that from other relevant sources. The responsibility for making decisions","page_number":528,"box":{"x":45,"y":136,"width":896,"height":12}},{"id":"c90341d9-1dc9-4555-a53e-9aba109467f7","block_type":"box","text":"to buy, sell or hold a particular security rests with the Manager. The Manager performs certain of the other administrative services","page_number":528,"box":{"x":45,"y":151,"width":906,"height":13}},{"id":"c068c0f5-3556-4418-8282-5841fe09ab9d","block_type":"box","text":"and provides all the office space, facilities, equipment and necessary personnel for management of each Fund.","page_number":528,"box":{"x":46,"y":167,"width":757,"height":12}},{"id":"917477c8-75c8-4e00-92bf-7dbac9f8a3b4","block_type":"box","text":"Management Fee.","page_number":528,"box":{"x":45,"y":191,"width":122,"height":12}},{"id":"d6326181-8a63-4655-9fdb-3416e1b1a907","block_type":"box","text":"Each Fund has entered into a management agreement with the Manager pursuant to which the Manager","page_number":528,"box":{"x":173,"y":190,"width":726,"height":13}},{"id":"a3143194-ad80-49d3-b379-1ceed955ee51","block_type":"box","text":"receives for its services to the Fund monthly compensation at an annual rate based on the average daily net assets of the Fund. For","page_number":528,"box":{"x":45,"y":205,"width":902,"height":13}},{"id":"07d7477f-fd34-4b0b-8096-17e937301565","block_type":"box","text":"information regarding the fees paid by your Fund to the Manager fo","page_number":528,"box":{"x":45,"y":221,"width":466,"height":13}},{"id":"11f704c0-40c8-4496-9e0f-266eb02af55a","block_type":"box","text":"for the Fund’s last three fiscal years or other applicable periods,","page_number":528,"box":{"x":511,"y":221,"width":434,"height":13}},{"id":"ef0d7ffd-e352-4ceb-a42c-708585852fef","block_type":"box","text":"see “Management, Advisory and Other Service Arrangements — Management Agreement” or “Management and Advisory","page_number":528,"box":{"x":46,"y":236,"width":856,"height":13}},{"id":"3c199447-d9a3-4669-b277-8c9529380b4a","block_type":"box","text":"Arrangements,” as applicable, in Part I of each Fund’s SAI. Each Management Agreement obligates the Manager to provide","page_number":528,"box":{"x":45,"y":252,"width":859,"height":13}},{"id":"66b19e5c-a5c3-4047-b9c0-1070e4831413","block_type":"box","text":"investment advisory services and to pay, or cause an affiliate to pay, for maintaining its staff and personnel and to provide office","page_number":528,"box":{"x":45,"y":267,"width":889,"height":13}},{"id":"7a18dc5f-a50e-48a8-9851-57923b2a3026","block_type":"box","text":"space, facilities and necessary personnel for the Fund. Each Manager is also obligated to pay, or cause an affiliate to pay, the fees","page_number":528,"box":{"x":46,"y":283,"width":892,"height":13}},{"id":"a576a46a-2326-4a41-ba81-a1f31d60f5f1","block_type":"box","text":"of all officers and Trustees of the Fund who are affiliated persons of the Manager or any affiliate.","page_number":528,"box":{"x":46,"y":298,"width":673,"height":13}},{"id":"ca1f9338-a3cb-4cb3-8aec-a8e4a2a9ca2b","block_type":"box","text":"For Funds that do not have an administration agreement with the Manager, each Management Agreement obligates the Manager","page_number":528,"box":{"x":45,"y":322,"width":899,"height":12}},{"id":"1f2268c6-b747-41d8-86e4-118bfca22aaa","block_type":"box","text":"to provide management services and to pay all compensation of and furnish office space for officers and employees of a Fund","page_number":528,"box":{"x":45,"y":337,"width":869,"height":13}},{"id":"a628fc54-6a9f-4cdd-873e-9efc183711d3","block_type":"box","text":"connected with investment and economic research, trading and investment management of the Fund, as well as the fees of all","page_number":528,"box":{"x":45,"y":353,"width":866,"height":12}},{"id":"de8d5aaa-8d3f-468b-9602-d6a88b4cae49","block_type":"box","text":"Trustees of the Fund who are interested persons of the Fund. Each Fund pays all other expenses incurred in the operation of that","page_number":528,"box":{"x":45,"y":368,"width":893,"height":13}},{"id":"5e2eb59b-11c5-4225-84c7-4b4a82ec867e","block_type":"box","text":"Fund, including among other things: taxes; expenses for legal","page_number":528,"box":{"x":45,"y":384,"width":424,"height":12}},{"id":"28be90f7-3e3e-4732-a087-91854e66a2f9","block_type":"box","text":"and auditing services; costs of preparing, printing and mailing","page_number":528,"box":{"x":474,"y":384,"width":428,"height":12}},{"id":"8a0e112c-fbbd-48f0-8a26-3f7cf396e44b","block_type":"box","text":"proxies, shareholder reports, prospectuses and statements of a","page_number":528,"box":{"x":45,"y":399,"width":430,"height":13}},{"id":"653bb402-1d92-4809-bb51-ccc72692e7a5","block_type":"box","text":"dditional information, except to the extent paid by BlackRock","page_number":528,"box":{"x":476,"y":399,"width":431,"height":13}},{"id":"aaf4e7fc-2a01-4666-877d-39ebabfdbda7","block_type":"box","text":"Investments, LLC (the “Distributor” or “BRIL”), charges of the c","page_number":528,"box":{"x":45,"y":415,"width":455,"height":12}},{"id":"d338c134-3433-43e5-8225-2f9705f33618","block_type":"box","text":"ustodian and sub-custodian, and the transfer agent; expenses of","page_number":528,"box":{"x":501,"y":415,"width":440,"height":12}},{"id":"4670b44e-28eb-4c06-b6c7-c0c99197937b","block_type":"box","text":"redemption of shares; Commission fees; expenses of registering the shares under Federal, state or foreign laws; fees and expenses","page_number":528,"box":{"x":45,"y":430,"width":890,"height":13}},{"id":"9e3b5122-4434-4215-9e4f-e5ade791d1cf","block_type":"box","text":"of Trustees who are not interested persons of a Fund as defined in the Investment Company Act; accounting and pricing costs","page_number":528,"box":{"x":46,"y":446,"width":870,"height":13}},{"id":"088e0826-f673-4845-8f93-12ac01a86eeb","block_type":"box","text":"(including the daily calculations of NAV); insurance; interest; b","page_number":528,"box":{"x":46,"y":461,"width":437,"height":13}},{"id":"e78efcaa-0ec3-43aa-9f50-428bc41ef27e","block_type":"box","text":"rokerage costs; litigation and other extraordinary or non-recurring","page_number":528,"box":{"x":484,"y":461,"width":461,"height":13}},{"id":"976eb90f-337c-4579-8180-bc89bd06636b","block_type":"box","text":"expenses; and other expenses properly payable by the Fund. Certain accounting services are provided to each Fund by The Bank of","page_number":528,"box":{"x":46,"y":477,"width":908,"height":13}},{"id":"01a2c485-cf3f-4fb8-8397-596e809c6f7b","block_type":"box","text":"New York Mellon (“BNYM”), State Street Bank and Trust Company (“State Street”) or JPMorgan Chase Bank, N.A. (“JPM”)","page_number":528,"box":{"x":45,"y":492,"width":886,"height":13}},{"id":"4854c0f7-20b4-41af-8be6-39e211c6d39c","block_type":"box","text":"pursuant to an agreement between BNYM, State Street or JPM, as applicable, and each Fund. Each Fund pays a fee for these","page_number":528,"box":{"x":45,"y":508,"width":867,"height":13}},{"id":"5e7ebead-6b3a-4a7c-8499-871b8b8349c5","block_type":"box","text":"services. In addition, the Manager provides certain accounting services to each Fund and the Fund pays the Manager a fee for such","page_number":528,"box":{"x":46,"y":523,"width":905,"height":13}},{"id":"94943deb-e7d8-404a-8d63-1b8482e73b67","block_type":"box","text":"services. The Distributor pays certain promotional expenses of the Funds incurred in connection with the offering of shares of the","page_number":528,"box":{"x":46,"y":539,"width":896,"height":13}},{"id":"21b81956-a06b-4d62-acf0-dd5129fbcd03","block_type":"box","text":"Funds. Certain expenses are financed by each Fund pursuant to distribution plans in compliance with Rule 12b-1 under the","page_number":528,"box":{"x":45,"y":554,"width":857,"height":13}},{"id":"27227c43-ba56-4fcc-8c7e-22ce295b9a82","block_type":"box","text":"Investment Company Act. See “Purchase of Shares — Distribution and/or Shareholder Servicing Plans.”","page_number":528,"box":{"x":45,"y":570,"width":720,"height":13}},{"id":"b40d344d-cff5-4a01-87e7-66fcf7a1f80f","block_type":"box","text":"Organization of the Manager.","page_number":528,"box":{"x":46,"y":593,"width":206,"height":13}},{"id":"e0188481-c3e0-4b3e-83a0-6d3d90864c63","block_type":"box","text":"The Manager, BlackRock Advisors, LLC, is a Delaware limited liability company and an indirect,","page_number":528,"box":{"x":258,"y":593,"width":678,"height":13}},{"id":"8837d6c3-5fa9-42b9-ba75-f803dca27b8f","block_type":"box","text":"majority-owned subsidiary of BlackRock, Inc.","page_number":528,"box":{"x":45,"y":608,"width":318,"height":13}},{"id":"d5492988-ef78-4a3f-8c1b-04a2a1723eed","block_type":"box","text":"Duration and Termination.","page_number":528,"box":{"x":45,"y":632,"width":190,"height":10}},{"id":"635ee015-3c54-43ec-a156-4dbf9bd541fb","block_type":"box","text":"Unless earlier terminated as described below, each Management Agreement will remain in effect from","page_number":528,"box":{"x":241,"y":632,"width":704,"height":13}},{"id":"d5af32d1-3c77-46c4-b50e-871acc7b1e78","block_type":"box","text":"year to year if approved annually (a) by the Trustees or by a vote of a majority of the outstanding voting securities of the Fund and","page_number":528,"box":{"x":45,"y":647,"width":908,"height":13}},{"id":"35998b1f-bd8f-4d7b-bac2-ea708510dee7","block_type":"box","text":"(b) by a majority of the Trustees who are not parties to such agreement or interested persons (as defined in the Investment","page_number":528,"box":{"x":46,"y":663,"width":845,"height":13}},{"id":"b6aed245-609e-4ad5-becb-53c0dee78a65","block_type":"box","text":"Company Act) of any such party. The Management Agreements are not assignable and may be terminated without penalty on","page_number":528,"box":{"x":46,"y":678,"width":875,"height":13}},{"id":"e5ca4409-3b24-4e4f-9bc8-45e451ca50e3","block_type":"box","text":"60 days’ written notice at the option of either party thereto or by the vote of the shareholders of the Fund.","page_number":528,"box":{"x":46,"y":694,"width":734,"height":13}},{"id":"4bba1a05-0249-4e58-92f9-d366d4eeaffc","block_type":"box","text":"Other Service Arrangements","page_number":528,"box":{"x":46,"y":725,"width":203,"height":13}},{"id":"59850a7c-1286-47c2-87a6-ec4720f0c5c7","block_type":"box","text":"Administrative Services and Administrative Fee.","page_number":528,"box":{"x":45,"y":751,"width":330,"height":10}},{"id":"24e3963e-9c23-42ac-9169-c09b8977d339","block_type":"box","text":"Certain Funds have entered into an administration agreement (the","page_number":528,"box":{"x":382,"y":751,"width":457,"height":12}},{"id":"878275dc-03b5-435d-aa16-27a0d7af9fd1","block_type":"box","text":"“Administration Agreement”) with an administrator identifie","page_number":528,"box":{"x":47,"y":766,"width":424,"height":13}},{"id":"33acad6b-436c-4b05-a111-4bdff7c5941f","block_type":"box","text":"d in the Fund’s Prospectus and Part I of the Fund’s SAI (each, an","page_number":528,"box":{"x":472,"y":766,"width":446,"height":13}},{"id":"c2953662-491b-4132-8c0c-8a898cba4433","block_type":"box","text":"“Administrator”). For its services to a Fund, the Administrator receives monthly compensation at the annual rate set forth in each","page_number":528,"box":{"x":47,"y":782,"width":899,"height":12}},{"id":"e859c18d-890d-4b48-9ae8-da331f1ec82c","block_type":"box","text":"applicable Fund’s Prospectus. For information regarding any adm","page_number":528,"box":{"x":46,"y":797,"width":455,"height":13}},{"id":"1d10c593-bdee-4e0c-83ee-45b8f60586bd","block_type":"box","text":"inistrative fees paid by your Fund to the Administrator for the","page_number":528,"box":{"x":502,"y":797,"width":429,"height":13}},{"id":"9c85b64d-e534-46f3-acff-7890d2491d78","block_type":"box","text":"periods indicated, see “Management, Advisory and Other Servic","page_number":528,"box":{"x":45,"y":813,"width":447,"height":12}},{"id":"f4951cda-5b92-4b88-af8d-a43863a1c323","block_type":"box","text":"e Arrangements — Administration Agreement” or “Management","page_number":528,"box":{"x":492,"y":813,"width":454,"height":12}},{"id":"d8ee276a-438d-4412-8309-bea0adfc28fa","block_type":"box","text":"and Advisory Arrangements,” as applicable, in Part I of that Fund’s SAI.","page_number":528,"box":{"x":46,"y":828,"width":501,"height":13}},{"id":"38a0b64d-a5ca-4d70-bf2d-697fd9798369","block_type":"box","text":"For Funds that have an Administrator, the Administration Ag","page_number":528,"box":{"x":45,"y":851,"width":428,"height":13}},{"id":"677567e3-c857-403e-8440-fbbd19441522","block_type":"box","text":"reement obligates the Administrator to provide certain","page_number":528,"box":{"x":474,"y":851,"width":378,"height":13}},{"id":"869fa871-28e5-43ff-af7f-1aa11bb15b65","block_type":"box","text":"administrative services to the Fund and to pay, or cause its affiliates to pay, for maintaining its staff and personnel and to provide","page_number":528,"box":{"x":46,"y":867,"width":896,"height":13}},{"id":"4e1aeb96-8091-4591-b1dc-8186a5256323","block_type":"box","text":"II-18","page_number":528,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"242fa85c-bca3-4fd1-804c-b27e4cae36c8","block_type":"box","text":"NM1026U-6004382-528/605","page_number":528,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"27ca7524-d375-4f05-a10d-a90d9707b52e","block_type":"box","text":"office space, facilities and necessary personnel for the Fund. Each Administrator is also obligated to pay, or cause its affiliates to","page_number":529,"box":{"x":46,"y":79,"width":885,"height":13}},{"id":"e1e4055c-27e9-4d2a-86b7-dbebef41d1c6","block_type":"box","text":"pay, the fees of those officers and Trustees of the Fund who are affiliated persons of the Administrator or any of its affiliates.","page_number":529,"box":{"x":45,"y":94,"width":864,"height":13}},{"id":"21c3cab3-7133-47cd-b478-bee0475b40ee","block_type":"box","text":"Duration and Termination of Administration Agreement.","page_number":529,"box":{"x":45,"y":117,"width":398,"height":12}},{"id":"da8816bb-35ca-4066-98d3-f2512899c7de","block_type":"box","text":"Unless earlier terminated as described below, each Administration","page_number":529,"box":{"x":449,"y":117,"width":458,"height":12}},{"id":"f7f7f5cb-b3e6-4bf8-8cdc-2a7fc8ecc3cd","block_type":"box","text":"Agreement with BlackRock will continue from year to year if approved annually (a) by the Board of Trustees of each applicable","page_number":529,"box":{"x":45,"y":132,"width":887,"height":13}},{"id":"7efb5aa6-f341-4ab1-9fd7-5e1ed5299fde","block_type":"box","text":"Fund or by a vote of a majority of the outstanding voting securities of such Fund and (b) by a majority of the Trustees of the Fund","page_number":529,"box":{"x":45,"y":148,"width":904,"height":13}},{"id":"bd71c5a7-ea80-4015-b596-4b49852c6b38","block_type":"box","text":"who are not parties to such contract or interested persons (as defined in the Investment Company Act) of any such party. Such","page_number":529,"box":{"x":45,"y":163,"width":876,"height":13}},{"id":"33f32f9a-0268-4ba9-923f-6416df4a4ed3","block_type":"box","text":"contract is not assignable and may be terminated without penalty on written notice at the option of either party thereto or by the","page_number":529,"box":{"x":45,"y":179,"width":895,"height":13}},{"id":"545fe70c-850f-41a6-aa24-ea9f9783e4fd","block_type":"box","text":"vote of the shareholders of the Fund.","page_number":529,"box":{"x":45,"y":194,"width":254,"height":10}},{"id":"b10a95c9-ac2a-408e-8dae-55252641682e","block_type":"box","text":"Transfer Agency Services.","page_number":529,"box":{"x":46,"y":217,"width":176,"height":12}},{"id":"6ecc5ec2-da5e-4bae-bcc5-0cf8827ac371","block_type":"box","text":"Each Fund has entered into an agreement with a transfer agent identified in the Fund’s Prospectus and","page_number":529,"box":{"x":228,"y":217,"width":708,"height":12}},{"id":"24b94231-e01a-43e8-8ba8-bf6dfa772182","block_type":"box","text":"Part I of the Fund’s SAI, pursuant to which the transfer agent is","page_number":529,"box":{"x":45,"y":232,"width":440,"height":13}},{"id":"9ac65fe8-7dc8-4248-8402-92021e9914fd","block_type":"box","text":"responsible for the issuance, transfer, and redemption of shares","page_number":529,"box":{"x":490,"y":232,"width":436,"height":13}},{"id":"056a6fff-9def-4b50-9360-c07a92c09709","block_type":"box","text":"and the opening and maintenance of shareholder accounts. Each Fund pays a fee for these services.","page_number":529,"box":{"x":46,"y":248,"width":684,"height":12}},{"id":"bd315845-6613-495a-8a71-f753797986a2","block_type":"box","text":"See “Management, Advisory and Other Service Arrangements, ‘— Transfer Agent’ or ‘— Transfer Agency Agreement’” or","page_number":529,"box":{"x":46,"y":270,"width":849,"height":13}},{"id":"33b3d8a9-1b25-4591-8fe9-e5bd54a80b26","block_type":"box","text":"“Management and Advisory Arrangements — Transfer Agency and Shareholders’ Administrative Services,” as applicable, in Part I","page_number":529,"box":{"x":47,"y":286,"width":906,"height":12}},{"id":"03d55248-946f-450c-a41a-55012461905e","block_type":"box","text":"of each Fund’s SAI.","page_number":529,"box":{"x":46,"y":301,"width":133,"height":10}},{"id":"49e654c1-035e-4ce6-8928-d2aff3a66938","block_type":"box","text":"Independent Registered Public Accounting Firm.","page_number":529,"box":{"x":45,"y":323,"width":337,"height":13}},{"id":"1140b32d-4032-4205-8919-12b2744a61c8","block_type":"box","text":"The Audit Committee of each Fund, the members of which are non-interested","page_number":529,"box":{"x":388,"y":323,"width":540,"height":13}},{"id":"4620051a-2b82-4590-ba86-bd8837ce1ed6","block_type":"box","text":"Trustees of the Fund, has selected an independent registered public accounting firm for that Fund that audits the Fund’s financial","page_number":529,"box":{"x":45,"y":339,"width":893,"height":13}},{"id":"b561e250-036e-411f-86f9-f300ed77202b","block_type":"box","text":"statements. Please see the inside back cover page of your Fund’s Prospectus and Part I, Section IX “Additional Information” of","page_number":529,"box":{"x":46,"y":354,"width":879,"height":13}},{"id":"6219d254-304a-4270-8ac6-fd112fc7e4da","block_type":"box","text":"each Fund’s SAI for information on your Fund’s independent registered public accounting firm.","page_number":529,"box":{"x":46,"y":370,"width":660,"height":13}},{"id":"e13c5a94-d691-4dc7-bc7b-0cb8ef32c3bd","block_type":"box","text":"Custodian Services.","page_number":529,"box":{"x":46,"y":392,"width":133,"height":10}},{"id":"8cdaa8ee-c085-4146-9b54-25f8cb66d2f0","block_type":"box","text":"The name and address of the custodian (the “Custodian”) of each Fund are provided on the inside back cover","page_number":529,"box":{"x":185,"y":392,"width":761,"height":13}},{"id":"03981bca-f42a-4562-99fc-0b005f9293a6","block_type":"box","text":"page of the Fund’s Prospectus. The Custodian is responsible for safeguarding and controlling the Fund’s cash and securities,","page_number":529,"box":{"x":45,"y":408,"width":858,"height":13}},{"id":"d086575c-51c8-4f10-bfb7-ae6e4fb63867","block_type":"box","text":"handling the receipt and delivery of securities and collecting interest and dividends on the Fund’s investments. The Custodian is","page_number":529,"box":{"x":45,"y":423,"width":882,"height":13}},{"id":"f41748d6-a60d-4d5b-ad72-7ea1a84f6a8c","block_type":"box","text":"authorized to establish separate accounts in foreign currencies","page_number":529,"box":{"x":46,"y":439,"width":428,"height":13}},{"id":"2ba16bf0-ca8f-445a-bd50-b45ea02145ce","block_type":"box","text":"and to cause foreign securities owned by the Fund to be held in its","page_number":529,"box":{"x":480,"y":439,"width":457,"height":13}},{"id":"8cd05f84-fc08-4cee-af96-2236a111bdb9","block_type":"box","text":"offices outside the United States and with certain foreign banks and securities depositories. A Fund also may use special purpose","page_number":529,"box":{"x":46,"y":454,"width":887,"height":13}},{"id":"29146492-5a67-48b0-98dc-df12384a4c34","block_type":"box","text":"custodian banks from time to time for certain assets.","page_number":529,"box":{"x":45,"y":470,"width":363,"height":10}},{"id":"71a803c0-6b44-41c7-b3b6-32a916aee190","block_type":"box","text":"Accounting Services.","page_number":529,"box":{"x":45,"y":493,"width":142,"height":12}},{"id":"1eee67b9-7118-4a81-9b90-4b2d738a970a","block_type":"box","text":"Each Fund has entered into an agreement with BNYM, State Street or JPM, pursuant to which BNYM, State","page_number":529,"box":{"x":193,"y":492,"width":756,"height":13}},{"id":"91833d17-61a9-4884-b4e2-8d8a544a4797","block_type":"box","text":"Street or JPM provides certain accounting and administrative services to the Fund. Each Fund pays a fee for these services.","page_number":529,"box":{"x":46,"y":508,"width":846,"height":13}},{"id":"190c29b3-b4ac-4e23-a26f-7372a21ead43","block_type":"box","text":"See “Management, Advisory and Other Service Arrangements — Accounting Services” or “Management and Advisory","page_number":529,"box":{"x":46,"y":530,"width":825,"height":13}},{"id":"43842f5a-a32a-4a5d-8b8e-588a00995310","block_type":"box","text":"Arrangements — Accounting Services,” as applicable, in Part I of each Fund’s SAI for information on the amounts paid by your","page_number":529,"box":{"x":45,"y":546,"width":887,"height":13}},{"id":"f9b18f4e-7315-4f73-b99c-557e351a1e34","block_type":"box","text":"Fund to BNYM, State Street or JPM, the Manager and/or the Administrator for the periods indicated.","page_number":529,"box":{"x":45,"y":561,"width":707,"height":13}},{"id":"e23561be-3af9-43c9-9029-5ee51323705f","block_type":"box","text":"Distribution Expenses.","page_number":529,"box":{"x":45,"y":584,"width":158,"height":12}},{"id":"656b9704-433d-410f-a2e3-df624f759ec5","block_type":"box","text":"Each Fund has entered into a distribution agreem","page_number":529,"box":{"x":209,"y":584,"width":342,"height":12}},{"id":"e03cc141-ea58-45b2-8aad-8082cffc46f3","block_type":"box","text":"ent with the Distributor in connection with the","page_number":529,"box":{"x":552,"y":584,"width":324,"height":10}},{"id":"36b49ce9-6f4b-4384-98ab-19e9608ba780","block_type":"box","text":"continuous offering of each class of shares of the Fund (the “Distri","page_number":529,"box":{"x":45,"y":599,"width":461,"height":13}},{"id":"e7011141-5138-490b-8a4e-ef7f77645e3b","block_type":"box","text":"bution Agreements”). The Distribution Agreements obligate the","page_number":529,"box":{"x":507,"y":599,"width":442,"height":13}},{"id":"999aaa8b-5475-4e2a-b354-6eb23d8142ab","block_type":"box","text":"Distributor to pay certain expenses in connection with the offering of each class of shares of the Funds. After the prospectuses,","page_number":529,"box":{"x":45,"y":615,"width":876,"height":12}},{"id":"4dbaba92-cca1-4514-be8f-18cac22ecb89","block_type":"box","text":"statements of additional information and periodic reports h","page_number":529,"box":{"x":46,"y":630,"width":412,"height":13}},{"id":"407a6255-0887-442a-a75e-f7eed2fbd7d5","block_type":"box","text":"ave been prepared, set in type and mailed to shareholders, the","page_number":529,"box":{"x":459,"y":630,"width":426,"height":13}},{"id":"fc295924-dc5d-43b8-906a-39e4062f708a","block_type":"box","text":"Distributor pays for the printing and distribution of these docum","page_number":529,"box":{"x":45,"y":646,"width":450,"height":13}},{"id":"f7a39b9c-57cd-4103-9a77-f265942c68ae","block_type":"box","text":"ents used in connection with the offering to dealers and investors.","page_number":529,"box":{"x":496,"y":646,"width":453,"height":13}},{"id":"93b2a449-9b66-4911-bbe9-bffe0142635f","block_type":"box","text":"The Distributor also pays for other supplementary sales literature","page_number":529,"box":{"x":45,"y":661,"width":453,"height":13}},{"id":"80741fc1-0f99-43fe-a3a2-0cee92b4b3be","block_type":"box","text":"and advertising costs. 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As such, BlackRock is or may be actively engaged in transac","page_number":535,"box":{"x":46,"y":398,"width":459,"height":13}},{"id":"ec5022ed-73ca-4d3e-9d28-eb91056fa42b","block_type":"box","text":"tions in the same securities, currencies, and instruments in which","page_number":535,"box":{"x":505,"y":398,"width":448,"height":12}},{"id":"3dcab0db-c2fe-407f-a6de-260918ba4afe","block_type":"box","text":"a Fund invests.","page_number":535,"box":{"x":46,"y":413,"width":102,"height":10}},{"id":"adbf3748-26fa-4d27-8084-64001832ac51","block_type":"box","text":"Such activities could affect the prices and availability of the securiti","page_number":535,"box":{"x":46,"y":436,"width":463,"height":13}},{"id":"18571e7a-31d5-4736-ab44-9a53da291c96","block_type":"box","text":"es, currencies, and instruments in which a Fund invests, which","page_number":535,"box":{"x":510,"y":436,"width":431,"height":13}},{"id":"2dc408d9-5b4a-44eb-b7c6-19be8e8bf35c","block_type":"box","text":"could have an adverse impact on a Fund’s performance. 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While not expected, it is possible that a recipient of portfolio","page_number":535,"box":{"x":45,"y":537,"width":860,"height":12}},{"id":"79181190-24d9-4395-a577-eba462e136dc","block_type":"box","text":"holdings information for such an investment vehicle could cause harm to a Fund that is managed in an identical or substantially","page_number":535,"box":{"x":45,"y":552,"width":886,"height":13}},{"id":"64c360bc-0abb-4aa7-b217-976d2fe2eac7","block_type":"box","text":"similar manner, including by trading ahead of or against such Fund based on the information received.","page_number":535,"box":{"x":46,"y":568,"width":711,"height":12}},{"id":"f744d43d-21a3-4a97-8bc2-3843bbbb1664","block_type":"box","text":"When BlackRock seeks to purchase or sell the same assets for client accounts, including a Fund, the assets actually purchased or","page_number":535,"box":{"x":45,"y":591,"width":887,"height":12}},{"id":"aab9ef6b-f08d-4f8d-81e6-882374ecec73","block_type":"box","text":"sold may be allocated among the accounts on a basis determined","page_number":535,"box":{"x":46,"y":606,"width":448,"height":13}},{"id":"58c2ad32-90c2-4ac9-8b0e-3acae70043e6","block_type":"box","text":"in its good faith discretion to be equitable. 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This may occur with respect to BlackRock-ad","page_number":535,"box":{"x":45,"y":668,"width":434,"height":13}},{"id":"432bbcc7-59bb-42c6-8edb-97edda04bc7c","block_type":"box","text":"vised accounts when investment decisions regarding a Fund are","page_number":535,"box":{"x":480,"y":668,"width":437,"height":13}},{"id":"25616c31-82a1-45f4-b21b-5c2fe3bfb647","block_type":"box","text":"based on research or other information that is also used to support decisions for other accounts. 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For example, the sale of a long position or establishment of a short position by a Fund may","page_number":535,"box":{"x":46,"y":792,"width":871,"height":13}},{"id":"856b15bd-2a6e-4d81-9f85-3665c34e7338","block_type":"box","text":"impair the price of the same security sold short by (and therefore benefit) BlackRock or its other accounts or funds, and the","page_number":535,"box":{"x":45,"y":808,"width":855,"height":12}},{"id":"91e382e1-1d8c-4581-a653-64d2eaeacec7","block_type":"box","text":"purchase of a security or covering of a short position in a security by a Fund may increase the price of the same security held by","page_number":535,"box":{"x":45,"y":823,"width":884,"height":13}},{"id":"c54c140f-9e99-4a78-af19-de38029157ca","block_type":"box","text":"(and therefore benefit) BlackRock or its other accounts or funds.","page_number":535,"box":{"x":46,"y":839,"width":446,"height":12}},{"id":"6a32c474-0fe0-4c57-a931-8586edf85e20","block_type":"box","text":"BlackRock, on behalf of other client accounts, on the one hand, and a Fund, on the other hand, may invest in or extend credit to","page_number":535,"box":{"x":46,"y":861,"width":891,"height":13}},{"id":"33742445-ab2c-4a1b-b341-772f86fd23a0","block_type":"box","text":"different parts of the capital structure of a single issuer. BlackRoc","page_number":535,"box":{"x":46,"y":877,"width":452,"height":13}},{"id":"5ea6df47-e5b2-4d1c-8f83-4ad379ab56e7","block_type":"box","text":"k may pursue rights, provide advice or engage in other activities,","page_number":535,"box":{"x":498,"y":877,"width":446,"height":13}},{"id":"17eff067-e0e5-4281-a4b9-7579df0fdf20","block_type":"box","text":"II-25","page_number":535,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"ceb8853e-cdc5-485f-8cdb-c420d9476840","block_type":"box","text":"NM1026U-6004382-535/605","page_number":535,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"979894df-54b6-471a-ad63-292118d2aa48","block_type":"box","text":"or refrain from pursuing rights, providing advice or engaging in other activities, on behalf of other clients with respect to an issuer","page_number":536,"box":{"x":46,"y":79,"width":900,"height":13}},{"id":"035ecede-7cb1-4dec-a1a2-38b4b134e979","block_type":"box","text":"in which a Fund has invested, and such actions (or refraining from action) may have a material adverse effect on the Fund. In","page_number":536,"box":{"x":45,"y":94,"width":868,"height":13}},{"id":"c6fcec0e-abf7-41fe-b241-c740eed4651c","block_type":"box","text":"situations in which clients of BlackRock (including the Funds) hold positions in multiple parts of the capital structure of an issuer,","page_number":536,"box":{"x":46,"y":110,"width":899,"height":13}},{"id":"495f4d73-1478-4983-8958-d6b52fb21979","block_type":"box","text":"BlackRock may not pursue certain actions or remedies that may be available to a Fund, as a result of legal and regulatory","page_number":536,"box":{"x":46,"y":125,"width":841,"height":13}},{"id":"ecf457c3-e9f4-47b5-8696-241f4316f73f","block_type":"box","text":"requirements or otherwise. BlackRock addresses these and other pot","page_number":536,"box":{"x":45,"y":141,"width":474,"height":13}},{"id":"33b4b176-4ec6-4578-b57a-832c132ca13c","block_type":"box","text":"ential conflicts of interest based on the facts and circumstances","page_number":536,"box":{"x":520,"y":141,"width":433,"height":10}},{"id":"8c253aff-4c2c-4e1f-bb6f-32f646dcfd7e","block_type":"box","text":"of particular situations. For example, BlackRock may determin","page_number":536,"box":{"x":46,"y":156,"width":437,"height":13}},{"id":"ded81ed1-a111-4c2f-9d97-06c7e6e425c1","block_type":"box","text":"e to rely on information barriers between different business units or","page_number":536,"box":{"x":484,"y":156,"width":468,"height":13}},{"id":"03e8e913-41c9-41a5-882e-9a857fd9ae4b","block_type":"box","text":"portfolio management teams. BlackRock may also determine to","page_number":536,"box":{"x":45,"y":172,"width":442,"height":13}},{"id":"3e79e21a-6e9e-46df-b60d-a34d11140124","block_type":"box","text":"rely on the actions of similarly situated holders of loans or","page_number":536,"box":{"x":492,"y":172,"width":404,"height":13}},{"id":"459e31f1-21b0-441b-a1cc-2058f896cc95","block_type":"box","text":"securities rather than, or in connection with, taking such actions itself on behalf of the Funds.","page_number":536,"box":{"x":46,"y":187,"width":646,"height":13}},{"id":"508c79e1-cc43-47f6-948c-6c055810e729","block_type":"box","text":"In addition, to the extent permitted by applicable law, certain Funds may invest their assets in other funds advised by BlackRock,","page_number":536,"box":{"x":45,"y":213,"width":895,"height":13}},{"id":"effa60b9-4c1c-4bc5-888e-04ee74362376","block_type":"box","text":"including funds that are managed by one or more of the same portfolio managers, which could result in conflicts of interest","page_number":536,"box":{"x":45,"y":228,"width":855,"height":13}},{"id":"47d60162-e360-48bb-a68a-56466cbed816","block_type":"box","text":"relating to asset allocation, timing of Fund purchases and red","page_number":536,"box":{"x":45,"y":244,"width":424,"height":13}},{"id":"831a022f-3367-4902-acad-c9871576046f","block_type":"box","text":"emptions, and increased remuneration and profitability for","page_number":536,"box":{"x":470,"y":244,"width":408,"height":13}},{"id":"8f8d13b8-708f-4464-9bf7-8f82a151ee31","block_type":"box","text":"BlackRock and/or its personnel, including portfolio managers.","page_number":536,"box":{"x":46,"y":259,"width":430,"height":13}},{"id":"47dbeb83-be6d-4854-a738-f17978485394","block_type":"box","text":"Third parties, including service providers to BlackRock or the Fund, may sponsor events (including, but not limited to, marketing","page_number":536,"box":{"x":45,"y":285,"width":898,"height":13}},{"id":"4c37d96b-8a9a-494e-bc64-1b3ed413914e","block_type":"box","text":"and promotional activities and presentations, educational train","page_number":536,"box":{"x":46,"y":300,"width":435,"height":13}},{"id":"9d8eba77-b4dd-4bc4-b882-11468d03ccfd","block_type":"box","text":"ing programs and conferences) for registered representatives, other","page_number":536,"box":{"x":481,"y":300,"width":462,"height":13}},{"id":"bdce60d4-91b9-4bf7-9275-384c2ddf780b","block_type":"box","text":"professionals and individual investors. 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BlackRock may (but is not required to) e","page_number":536,"box":{"x":46,"y":372,"width":444,"height":13}},{"id":"54be1422-0a22-4a21-aae5-50371f15c9ce","block_type":"box","text":"ffect purchases and sales between BlackRock clients (“cross","page_number":536,"box":{"x":491,"y":372,"width":412,"height":13}},{"id":"1548a692-7798-4d00-b0e5-32a5c76e5a7e","block_type":"box","text":"trades”), including the Funds, if BlackRock believes such transactions are appropriate based on each party’s investment objectives","page_number":536,"box":{"x":45,"y":388,"width":899,"height":12}},{"id":"f73d45d8-4683-44d7-9bee-f81e4c5cb63c","block_type":"box","text":"and guidelines, subject to applicable law and regulation. There may be potential conflicts of interest or regulatory issues relating to","page_number":536,"box":{"x":46,"y":403,"width":904,"height":13}},{"id":"a09d222e-0f69-45db-bbfe-d2e3a1aacdd1","block_type":"box","text":"these transactions which could limit BlackRock’s decision to","page_number":536,"box":{"x":45,"y":419,"width":419,"height":10}},{"id":"1989a085-e390-4803-bab5-2c3b64750297","block_type":"box","text":"engage in these transactions for the Funds. BlackRock may have a","page_number":536,"box":{"x":469,"y":419,"width":457,"height":13}},{"id":"22377b1b-e838-4c9d-878e-f448f7508f74","block_type":"box","text":"potentially conflicting division of loyalties and responsibilities to the parties in such transactions.","page_number":536,"box":{"x":45,"y":434,"width":668,"height":13}},{"id":"9374e193-d7ba-461b-b648-4778896a1c08","block_type":"box","text":"BlackRock and its clients may pursue or enforce rights with respect to an issuer in which a Fund has invested, and those activities","page_number":536,"box":{"x":46,"y":460,"width":895,"height":12}},{"id":"4941c277-60f1-4ee7-a27d-7a539e112465","block_type":"box","text":"may have an adverse effect on the Fund. As a result, prices, availability, liquidity and terms of the Fund’s investments may be","page_number":536,"box":{"x":45,"y":475,"width":867,"height":13}},{"id":"4a2d7200-aadb-41f7-8640-7d09527ec69d","block_type":"box","text":"negatively impacted by the activities of BlackRock or its clients, and transactions for the Fund may be impaired or effected at","page_number":536,"box":{"x":45,"y":491,"width":867,"height":12}},{"id":"81e33c2b-cb7c-49c4-9bce-676e1efae1ae","block_type":"box","text":"prices or terms that may be less favorable than would otherwise have been the case.","page_number":536,"box":{"x":45,"y":506,"width":579,"height":13}},{"id":"9a4cda60-aa62-41c1-8d1c-02f891b52879","block_type":"box","text":"The results of a Fund’s investment activities may differ significantly from the results achieved by BlackRock for its proprietary","page_number":536,"box":{"x":45,"y":532,"width":874,"height":12}},{"id":"2c5f09f8-585c-4238-9e8b-9559f2c77325","block_type":"box","text":"accounts or other accounts (including investment companies or c","page_number":536,"box":{"x":46,"y":547,"width":449,"height":13}},{"id":"e84ed18d-1ea9-43a2-8212-a54b9ecbf544","block_type":"box","text":"ollective investment vehicles) that it manages or advises. It is","page_number":536,"box":{"x":495,"y":547,"width":417,"height":13}},{"id":"bc07cd15-7201-4c54-a12e-cd3a4e5c9d1b","block_type":"box","text":"possible that one or more accounts managed or advised by BlackR","page_number":536,"box":{"x":45,"y":563,"width":462,"height":12}},{"id":"ca28b80a-d45f-4634-857c-e33dbcddfd3f","block_type":"box","text":"ock and such other accounts will achieve investment results that","page_number":536,"box":{"x":508,"y":563,"width":443,"height":10}},{"id":"ba015316-ca4d-4750-8782-e6e06a1ee69c","block_type":"box","text":"are substantially more or less favorable than the results achiev","page_number":536,"box":{"x":46,"y":578,"width":429,"height":13}},{"id":"2ca5b0c0-88c9-4d28-a372-3d09a7878c76","block_type":"box","text":"ed by a Fund. 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As a result, there may be","page_number":536,"box":{"x":445,"y":666,"width":454,"height":12}},{"id":"54943ac0-54e7-4d49-8f88-f3d90b537ff7","block_type":"box","text":"periods, for example, when BlackRock will not initiate or recommend certain types of transactions in certain securities or","page_number":536,"box":{"x":45,"y":681,"width":841,"height":13}},{"id":"fbef57d9-653b-40c5-bab2-5cbff4a45391","block_type":"box","text":"instruments with respect to which BlackRock is performing servi","page_number":536,"box":{"x":45,"y":697,"width":449,"height":12}},{"id":"5aeac9af-0da6-495c-aca4-bb98d0d98c18","block_type":"box","text":"ces or when position limits have been reached. 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BlackRock will not be","page_number":536,"box":{"x":45,"y":784,"width":454,"height":13}},{"id":"feb20265-8360-4c72-afaa-073cd464d8be","block_type":"box","text":"under any obligation, however, to effect transactions on behalf","page_number":536,"box":{"x":504,"y":784,"width":436,"height":13}},{"id":"1e6dac12-712b-4d50-a5a0-47f2a62b4c79","block_type":"box","text":"of a Fund in accordance with such analysis and models. 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To the extent","page_number":537,"box":{"x":527,"y":79,"width":416,"height":13}},{"id":"1734bf81-a53c-47af-b6fd-fcb2cb0352c8","block_type":"box","text":"clients invest in these investment models and increase the assets under management of the Funds, the investment management fee","page_number":537,"box":{"x":45,"y":94,"width":895,"height":13}},{"id":"6e441a99-52bd-4556-b96c-c4a74818c799","block_type":"box","text":"amounts paid by the Funds to BlackRock may also increase. The net asset value and liquidity of a Fund may be impacted by","page_number":537,"box":{"x":46,"y":110,"width":861,"height":13}},{"id":"1b9f7314-025e-4a39-b528-17af1224f145","block_type":"box","text":"purchases and sales of the Fund by model-driven investment portfolios, as well as by BlackRock itself and by its advisory clients.","page_number":537,"box":{"x":45,"y":125,"width":890,"height":13}},{"id":"adf4e554-eb2b-42d7-b864-290861613639","block_type":"box","text":"In addition, certain principals and certain employees of a Fund’s i","page_number":537,"box":{"x":45,"y":149,"width":454,"height":12}},{"id":"f10ac957-e759-4d0e-853d-844fea824fd0","block_type":"box","text":"nvestment adviser are also principals or employees of other","page_number":537,"box":{"x":500,"y":149,"width":409,"height":12}},{"id":"31442c71-d228-49a0-bfd0-c6670a4aaaa3","block_type":"box","text":"business units or entities within BlackRock. 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Additionally, an affiliate of BlackRock","page_number":537,"box":{"x":46,"y":319,"width":891,"height":13}},{"id":"04782c4c-8af0-4c62-b5ab-8863061f9259","block_type":"box","text":"will create, write or issue options, which may be based on the performance of certain Funds. BlackRock has entered into an","page_number":537,"box":{"x":45,"y":335,"width":857,"height":12}},{"id":"319fef99-8589-4f9a-af5d-3db79b3107c1","block_type":"box","text":"arrangement with Markit Indices Limited, the index provider for underlying fixed-income indexes used by certain iShares ETFs,","page_number":537,"box":{"x":46,"y":350,"width":885,"height":13}},{"id":"cbc7b0f2-ff02-457f-81bb-2189acca287c","block_type":"box","text":"related to derivative fixed-income products that are based on su","page_number":537,"box":{"x":45,"y":366,"width":442,"height":12}},{"id":"215672d5-65a8-45df-8c62-4fb3973b5d12","block_type":"box","text":"ch iShares ETFs. Trading activity in these derivative products","page_number":537,"box":{"x":488,"y":366,"width":423,"height":12}},{"id":"69375ca4-3546-4a81-9875-207927dd2154","block_type":"box","text":"could also potentially lead to greater liquidity for such pr","page_number":537,"box":{"x":45,"y":381,"width":396,"height":13}},{"id":"3b714281-8a2a-476b-a423-aa9fe883f275","block_type":"box","text":"oducts, increased purchase activity with respect to these iShares ETFs and","page_number":537,"box":{"x":442,"y":381,"width":510,"height":13}},{"id":"3d58fc35-e327-4bbf-aba6-617762095919","block_type":"box","text":"increased assets under management for BlackRock.","page_number":537,"box":{"x":45,"y":397,"width":354,"height":12}},{"id":"701211ee-f8d4-42db-a9f0-570d99ccf657","block_type":"box","text":"A Fund may, subject to applicable law, purchase investments that are the subject of an underwriting or other distribution by","page_number":537,"box":{"x":45,"y":420,"width":862,"height":13}},{"id":"b12f1a05-5e00-4abd-ae47-e9f297259ec1","block_type":"box","text":"BlackRock and may also enter into transactions with other clients of BlackRock where such other clients have interests adverse to","page_number":537,"box":{"x":46,"y":435,"width":899,"height":13}},{"id":"35e97f03-d6de-4208-85a1-77229766c30c","block_type":"box","text":"those of the Fund. At times, these activities may cause business units or entities within BlackRock to give advice to clients that may","page_number":537,"box":{"x":45,"y":451,"width":907,"height":13}},{"id":"a0acc5f1-6f77-48f7-9cc5-9f68c2641b36","block_type":"box","text":"cause these clients to take actions adverse to the interests of the Fund. To the extent such transactions are permitted, a Fund will","page_number":537,"box":{"x":45,"y":466,"width":889,"height":13}},{"id":"aced4ea6-5e05-4dbe-bc55-06dd142bb749","block_type":"box","text":"deal with BlackRock on an arms-length basis.","page_number":537,"box":{"x":46,"y":482,"width":316,"height":13}},{"id":"2c8849fb-df09-46fd-adfc-72c5e7016474","block_type":"box","text":"To the extent authorized by applicable law, BlackRock may act a","page_number":537,"box":{"x":45,"y":505,"width":453,"height":13}},{"id":"af93b05f-c99d-4663-b3e4-5bfe622cf9e1","block_type":"box","text":"s broker, dealer, agent, lender or adviser or in other commercial","page_number":537,"box":{"x":499,"y":505,"width":442,"height":13}},{"id":"49d05b45-8a91-48f2-9ad3-155812467224","block_type":"box","text":"capacities for a Fund. It is anticipated that the commissions, mar","page_number":537,"box":{"x":45,"y":521,"width":448,"height":12}},{"id":"d62dbbc5-4c8b-4e90-9ecf-e7897c119943","block_type":"box","text":"k-ups, mark-downs, financial advisory fees, underwriting and","page_number":537,"box":{"x":493,"y":521,"width":427,"height":12}},{"id":"12bf866e-a116-4a9c-8fe5-fb4b642017b3","block_type":"box","text":"placement fees, sales fees, financing and commitment fees, brok","page_number":537,"box":{"x":45,"y":536,"width":440,"height":13}},{"id":"3cca1666-48df-463c-ac92-aa3b2ffc8f2a","block_type":"box","text":"erage fees, other fees, compensation or profits, rates, terms and","page_number":537,"box":{"x":486,"y":536,"width":437,"height":13}},{"id":"d6e385b5-9114-4816-a1e6-92c98226edaf","block_type":"box","text":"conditions charged by BlackRock will be in its view commercially reasonable, although BlackRock, including its sales personnel,","page_number":537,"box":{"x":45,"y":552,"width":891,"height":12}},{"id":"5c0e0ae9-4d04-46cd-a7cd-7bca13573d39","block_type":"box","text":"will have an interest in obtaining fees and other amounts that are favorable to BlackRock and such sales personnel, which may","page_number":537,"box":{"x":45,"y":567,"width":880,"height":13}},{"id":"b8834eb0-d909-4707-9f10-629368e3a154","block_type":"box","text":"have an adverse effect on the Funds. Index based funds may use an index provider that is affiliated with another service provider","page_number":537,"box":{"x":45,"y":583,"width":891,"height":12}},{"id":"7632bb92-dc21-4633-aed3-60db68dbd4a2","block_type":"box","text":"of the Fund or BlackRock that acts as a broker, dealer, agent, le","page_number":537,"box":{"x":46,"y":598,"width":442,"height":13}},{"id":"75bdccca-76b9-492c-87b2-8ea464651e8b","block_type":"box","text":"nder or in other commercial capacities for a Fund or BlackRock.","page_number":537,"box":{"x":488,"y":598,"width":447,"height":13}},{"id":"77c861af-1416-4af3-a2ed-bb26820a0129","block_type":"box","text":"Subject to applicable law, BlackRock (and its personnel and other distributors) will be entitled to retain fees and other amounts","page_number":537,"box":{"x":46,"y":621,"width":882,"height":13}},{"id":"63a32b97-dabc-42d1-a9a9-8092aff471da","block_type":"box","text":"that they receive in connection with their service to the Funds as broker, dealer, agent, lender, adviser or in other commercial","page_number":537,"box":{"x":45,"y":637,"width":866,"height":13}},{"id":"613c8458-369f-4d44-85e1-ba980e3817b6","block_type":"box","text":"capacities. No accounting to the Funds or their shareholders will be required, and no fees or other compensation payable by the","page_number":537,"box":{"x":45,"y":652,"width":887,"height":13}},{"id":"25de7840-5bd0-4ea9-b4f3-68dbba4c31d4","block_type":"box","text":"Funds or their shareholders will be reduced by reason of receipt by BlackRock of any such fees or other amounts.","page_number":537,"box":{"x":45,"y":668,"width":786,"height":13}},{"id":"3741abfb-6bf8-49f0-9a2e-06eebd5a21a4","block_type":"box","text":"When BlackRock acts as broker, dealer, agent, adviser or in other commercial capacities in relation to the Funds, BlackRock may","page_number":537,"box":{"x":45,"y":691,"width":898,"height":13}},{"id":"a34e224d-f719-4bd7-8066-be50b6ecb25e","block_type":"box","text":"take commercial steps in its own interests, which may have an adverse effect on the Funds.","page_number":537,"box":{"x":45,"y":707,"width":627,"height":12}},{"id":"b5ac357b-872e-4e3b-9f79-70b668e215c6","block_type":"box","text":"A Fund will be required to establish business relationships with its counterparties based on the Fund’s own credit standing.","page_number":537,"box":{"x":45,"y":730,"width":851,"height":13}},{"id":"1585ebdc-5a24-47fa-8e65-bbf52a059bd7","block_type":"box","text":"BlackRock will not have any obligation to allow its credit to be","page_number":537,"box":{"x":46,"y":745,"width":438,"height":13}},{"id":"0c807e07-149f-47f1-ac8e-6be482a1a0fd","block_type":"box","text":"used in connection with a Fund’s establishment of its business","page_number":537,"box":{"x":489,"y":745,"width":428,"height":10}},{"id":"5421d621-e361-482c-9f13-3c6c88473fe8","block_type":"box","text":"relationships, nor is it expected that the Fund’s counterpartie","page_number":537,"box":{"x":45,"y":761,"width":422,"height":13}},{"id":"657c80f3-f476-4c43-85b7-35ab1c8d7193","block_type":"box","text":"s will rely on the credit of BlackRock in evaluating the Fund’s","page_number":537,"box":{"x":468,"y":761,"width":426,"height":13}},{"id":"01161c83-52b8-4c68-9dce-8bf585ad6ca8","block_type":"box","text":"creditworthiness.","page_number":537,"box":{"x":45,"y":776,"width":118,"height":11}},{"id":"13963eab-6726-4e3b-9a45-a9b136094474","block_type":"box","text":"BlackRock Investment Management, LLC (“BIM”) or BlackRock In","page_number":537,"box":{"x":46,"y":800,"width":474,"height":13}},{"id":"0146bdf1-fd60-4b20-aa47-8d23896d9913","block_type":"box","text":"stitutional Trust Company, N.A. (“BTC”), as applicable, each","page_number":537,"box":{"x":521,"y":800,"width":432,"height":13}},{"id":"c3896f5b-ec17-4da2-a936-abed319477ec","block_type":"box","text":"an affiliate of BlackRock, pursuant to SEC exemptive relief, acts as securities lending agent to, and receives a share of securities","page_number":537,"box":{"x":46,"y":815,"width":879,"height":13}},{"id":"78e484b0-7d23-4167-a9ca-57c6c42dfb66","block_type":"box","text":"lending revenues from, the Funds. BlackRock will also receive compensation for managing the reinvestment of the cash collateral","page_number":537,"box":{"x":45,"y":831,"width":895,"height":13}},{"id":"c6f6d67e-2d4f-44ee-9910-6b9649cad49f","block_type":"box","text":"from securities lending. There are potential conflicts of interests in managing a securities lending program, including but not","page_number":537,"box":{"x":45,"y":846,"width":859,"height":13}},{"id":"80d99399-d7f2-46f9-8ac4-0904a3c0809d","block_type":"box","text":"limited to: (i) BlackRock as securities lending agent may have an incentive to, among other things, increase or decrease the amount","page_number":537,"box":{"x":45,"y":862,"width":906,"height":13}},{"id":"f0c53235-e026-4ff9-92fd-689f5845d6ca","block_type":"box","text":"of securities on loan or to lend particular securities in order to gen","page_number":537,"box":{"x":46,"y":877,"width":457,"height":13}},{"id":"6f4f626d-0edd-4ec3-b498-ccc5cace9868","block_type":"box","text":"erate additional risk-adjusted revenue for BlackRock and its","page_number":537,"box":{"x":504,"y":877,"width":415,"height":13}},{"id":"0f5a2557-4dc6-41c8-a254-730ae2db17dd","block_type":"box","text":"II-27","page_number":537,"box":{"x":482,"y":917,"width":35,"height":9}},{"id":"f64a44f5-6f17-43a1-beca-7062cc02b872","block_type":"box","text":"NM1026U-6004382-537/605","page_number":537,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"66d37e2f-c225-4d60-a56b-36fced6b4d99","block_type":"box","text":"affiliates; and (ii) BlackRock as securities lending agent may have an incentive to allocate loans to clients that would provide more","page_number":538,"box":{"x":46,"y":79,"width":900,"height":13}},{"id":"1539dd84-b929-4a50-8477-f9af95a02898","block_type":"box","text":"revenue to BlackRock. As described further below, BlackRock seeks to mitigate this conflict by providing its securities lending","page_number":538,"box":{"x":45,"y":94,"width":873,"height":13}},{"id":"be494b1d-be7e-4d46-ba74-9b9a7ba652cb","block_type":"box","text":"clients with equal lending opportunities over time in order to approximate pro rata allocation.","page_number":538,"box":{"x":45,"y":110,"width":653,"height":13}},{"id":"2605a229-2978-402d-a3af-252575353631","block_type":"box","text":"As part of its securities lending program, BlackRock indemn","page_number":538,"box":{"x":45,"y":135,"width":418,"height":13}},{"id":"4045fac4-c43e-46c4-81f8-c44d8b12a893","block_type":"box","text":"ifies the Funds and certain other clients and/or funds against a","page_number":538,"box":{"x":464,"y":135,"width":429,"height":13}},{"id":"144cf1e1-01fa-4792-b3b4-d1d9f7158e6e","block_type":"box","text":"shortfall in collateral in the event of borrower default. 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For a more detailed discussion of these policies and procedures, see “Proxy Voting Policies and Procedures.”","page_number":539,"box":{"x":46,"y":660,"width":836,"height":13}},{"id":"0c74492b-11de-4480-afe7-2bbf60d8c78d","block_type":"box","text":"It is also possible that, from time to time, BlackRock and/or its ad","page_number":539,"box":{"x":45,"y":683,"width":457,"height":13}},{"id":"d305dd40-69aa-4763-a428-39c930a43d3d","block_type":"box","text":"visory clients (including other funds and separately managed","page_number":539,"box":{"x":502,"y":683,"width":420,"height":13}},{"id":"a9c70f39-3d68-4834-ad62-af51feb43b4c","block_type":"box","text":"accounts) may, subject to compliance with applicable law, purchase and hold shares of a Fund. Increasing a Fund’s assets may","page_number":539,"box":{"x":46,"y":699,"width":875,"height":13}},{"id":"7bf6c5fb-4d5d-4342-a2e2-012275e49eed","block_type":"box","text":"enhance investment flexibility and diversification and may contribute to economies of scale that tend to reduce the Fund’s expense","page_number":539,"box":{"x":46,"y":714,"width":902,"height":13}},{"id":"97ead3e0-d0af-470d-83ac-aacc190ef7e1","block_type":"box","text":"ratio. BlackRock reserves the right, subject to compliance with app","page_number":539,"box":{"x":45,"y":730,"width":464,"height":13}},{"id":"75a917a0-ccfb-48e4-bdec-249bb1971c0f","block_type":"box","text":"licable law, to redeem at any time some or all of the shares of a","page_number":539,"box":{"x":510,"y":730,"width":438,"height":13}},{"id":"01f128d6-5864-41df-8179-f298f7bb6799","block_type":"box","text":"Fund acquired for its own accounts. A large redemption of shares of a Fund by BlackRock could significantly reduce the asset size","page_number":539,"box":{"x":45,"y":745,"width":901,"height":13}},{"id":"06f5c0cd-00e4-4e40-9171-6b97fd1efa10","block_type":"box","text":"of the Fund, which might have an adverse effect on the Fund’s investment flexibility, portfolio diversification and expense ratio.","page_number":539,"box":{"x":46,"y":761,"width":883,"height":13}},{"id":"0bfde27c-763b-4c04-8e1d-e0e57ec2f7d5","block_type":"box","text":"BlackRock seeks to consider the effect of redemptions on a Fund an","page_number":539,"box":{"x":46,"y":776,"width":469,"height":13}},{"id":"70dc5bfc-57c9-4adc-91a5-017443f6be40","block_type":"box","text":"d other shareholders in deciding whether to redeem its shares","page_number":539,"box":{"x":516,"y":776,"width":423,"height":13}},{"id":"f492e740-ae09-4cba-975f-a6c1760decdf","block_type":"box","text":"but is not obligated to do so and may elect not to do so.","page_number":539,"box":{"x":46,"y":792,"width":386,"height":13}},{"id":"c0252939-127e-466c-acad-4b4024b6ce5a","block_type":"box","text":"It is possible that a Fund may invest in securities of, or engage in tran","page_number":539,"box":{"x":45,"y":815,"width":479,"height":13}},{"id":"69e03ce7-4b35-403a-9bb5-73a5a554957b","block_type":"box","text":"sactions with, companies in which BlackRock has significant","page_number":539,"box":{"x":525,"y":815,"width":421,"height":13}},{"id":"9832204a-70a2-4981-bd6d-1567a18ea691","block_type":"box","text":"debt or equity investments or other interests. A Fund may also invest in issuances (such as structured notes) by entities for which","page_number":539,"box":{"x":46,"y":831,"width":889,"height":13}},{"id":"52afc871-81bb-49c4-bcef-1556ed3d7e3b","block_type":"box","text":"BlackRock provides and is compensated for cash management services relating to the proceeds from the sale of such issuances. In","page_number":539,"box":{"x":46,"y":846,"width":895,"height":13}},{"id":"202aa37e-b4e2-4035-ac6b-435d8bb3fddf","block_type":"box","text":"making investment decisions for a Fund, BlackRock is not perm","page_number":539,"box":{"x":45,"y":862,"width":444,"height":13}},{"id":"973158ae-4dc5-4ace-bea6-474d2b083d5b","block_type":"box","text":"itted to obtain or use material non-public information acquired by","page_number":539,"box":{"x":489,"y":862,"width":460,"height":13}},{"id":"42da2563-0198-4468-8d0e-596ab73de09b","block_type":"box","text":"any unit of BlackRock, in the course of these activities. In add","page_number":539,"box":{"x":46,"y":877,"width":428,"height":13}},{"id":"558e55f9-617f-4bf3-ad83-17f29f55049e","block_type":"box","text":"ition, from time to time, the activities of BlackRock may limit a","page_number":539,"box":{"x":475,"y":877,"width":439,"height":13}},{"id":"8896c9bf-8cb4-4491-b8ba-9442be39e275","block_type":"box","text":"II-29","page_number":539,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"c8a3e373-2e65-47ad-850f-931985042e48","block_type":"box","text":"NM1026U-6004382-539/605","page_number":539,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3e3914e1-063e-4065-8094-b262d66a04b4","block_type":"box","text":"Fund’s flexibility in purchases and sales of securities. As indicate","page_number":540,"box":{"x":45,"y":79,"width":445,"height":13}},{"id":"7c0d8916-dfd7-45f1-90c6-de8c49cfd8f5","block_type":"box","text":"d below, BlackRock may engage in transactions with companies","page_number":540,"box":{"x":491,"y":79,"width":446,"height":13}},{"id":"23873a92-395b-455e-88ad-41da8207b85b","block_type":"box","text":"in which BlackRock-advised funds or other clients of BlackRock have an investment.","page_number":540,"box":{"x":45,"y":94,"width":589,"height":10}},{"id":"ee9beea1-9a46-4def-9866-abe0eb3c4c0e","block_type":"box","text":"BlackRock and its personnel and other financial service providers may have interests in promoting sales of the Funds. 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BlackRock and its sales personnel may directly or indirectly receive a portion of the fees and commissions","page_number":540,"box":{"x":46,"y":164,"width":895,"height":13}},{"id":"8d26d7b1-7791-437c-a4a3-5b41af2176c1","block_type":"box","text":"charged to the Funds or their shareholders. BlackRock and its advisory or other personnel may also benefit from increased","page_number":540,"box":{"x":45,"y":180,"width":850,"height":12}},{"id":"14666b63-cb80-4193-934b-1f0677fe3e35","block_type":"box","text":"amounts of assets under management. Fees and commissions may a","page_number":540,"box":{"x":46,"y":195,"width":468,"height":13}},{"id":"13a7e1cb-64ab-4934-a018-9e2777aaec82","block_type":"box","text":"lso be higher than for other products or services, and the","page_number":540,"box":{"x":515,"y":195,"width":392,"height":13}},{"id":"23ae1e58-8638-4744-8721-52d01a664281","block_type":"box","text":"remuneration and profitability to BlackRock and such personnel resulting from transactions on behalf of or management of the","page_number":540,"box":{"x":45,"y":211,"width":885,"height":12}},{"id":"3125eb55-8e5b-4936-bd2a-288d470da426","block_type":"box","text":"Funds may be greater than the remuneration and profitability resulting from other funds or products.","page_number":540,"box":{"x":45,"y":226,"width":703,"height":13}},{"id":"d8b07571-c11d-4660-95e7-771b3ac0c1c5","block_type":"box","text":"BlackRock may provide valuation assistance to certain clients with respect to certain securities or other investments and the","page_number":540,"box":{"x":46,"y":249,"width":855,"height":13}},{"id":"f8225b28-0def-4e89-b120-421df9e53ec3","block_type":"box","text":"valuation recommendations made for such clients’ accounts may d","page_number":540,"box":{"x":45,"y":265,"width":462,"height":13}},{"id":"5ec2bf9d-eb9b-401a-9bbe-7dc921999d61","block_type":"box","text":"iffer from the valuations for the same securities or investments","page_number":540,"box":{"x":507,"y":265,"width":431,"height":10}},{"id":"88d51a8b-14e6-43ff-b2fb-718525d08c2f","block_type":"box","text":"assigned by a Fund’s pricing vendors, especially if such valua","page_number":540,"box":{"x":46,"y":280,"width":420,"height":13}},{"id":"f6afb887-f94d-4d15-adc6-65c37e2f50cd","block_type":"box","text":"tions are based on broker-dealer quotes or other data sources","page_number":540,"box":{"x":467,"y":280,"width":424,"height":13}},{"id":"f0c52cf5-b746-47ab-855d-a8953ca3e4f2","block_type":"box","text":"unavailable to the Fund’s pricing vendors. While BlackRock will generally communicate its valuation information or","page_number":540,"box":{"x":46,"y":296,"width":808,"height":13}},{"id":"36597cea-9445-46ce-a530-fcca5ce9a10e","block_type":"box","text":"determinations to a Fund’s pricing vendors and/or fund accountan","page_number":540,"box":{"x":46,"y":311,"width":460,"height":13}},{"id":"d4af7597-4d2d-4f45-8590-cd2544e01a13","block_type":"box","text":"ts, there may be instances where the Fund’s pricing vendors or","page_number":540,"box":{"x":506,"y":311,"width":431,"height":13}},{"id":"b3cd7ba4-ea56-491b-9e03-be2fb95c1d33","block_type":"box","text":"fund accountants assign a different valuation to a security or other investment than the valuation for such security or investment","page_number":540,"box":{"x":45,"y":327,"width":890,"height":13}},{"id":"1b94e666-bc39-4ba1-85ef-42e107c10f1d","block_type":"box","text":"determined or recommended by BlackRock.","page_number":540,"box":{"x":46,"y":342,"width":304,"height":13}},{"id":"a185c153-0779-46e7-9a61-3a255bf52503","block_type":"box","text":"BlackRock and its directors, officers and employees, may buy and sell securities or other investments for their own accounts and","page_number":540,"box":{"x":46,"y":366,"width":889,"height":12}},{"id":"e565e5fb-b8f1-419c-bd79-a00292b0fe1e","block_type":"box","text":"may have conflicts of interest with respect to investments made on beh","page_number":540,"box":{"x":45,"y":381,"width":490,"height":13}},{"id":"875f5fc3-de31-4e71-b9f4-f2d7ec2a4695","block_type":"box","text":"alf of a Fund. As a result of differing trading and investment","page_number":540,"box":{"x":535,"y":381,"width":417,"height":13}},{"id":"98d6b928-989c-43d8-892b-cb7ae19c9f5d","block_type":"box","text":"strategies or constraints, positions may be taken by directors, o","page_number":540,"box":{"x":46,"y":397,"width":436,"height":12}},{"id":"00fb5f1c-107c-4a4d-ab5d-5ffc6c722d1b","block_type":"box","text":"fficers and employees of BlackRock that are the same, different","page_number":540,"box":{"x":483,"y":397,"width":437,"height":12}},{"id":"875916c1-5fa0-4d47-a20d-f84f6f79a4ab","block_type":"box","text":"from or made at different times than positions taken for the Fund. To lessen the possibility that a Fund will be adversely affected","page_number":540,"box":{"x":45,"y":412,"width":892,"height":13}},{"id":"29aeeaa9-78f5-4799-bd80-e67144c8e582","block_type":"box","text":"by this personal trading, the Fund, BRIL and BlackRock each have adopted a Code of Ethics in compliance with Section 17(j) of","page_number":540,"box":{"x":46,"y":428,"width":890,"height":12}},{"id":"917aa1af-692b-4f1d-9c1e-2a8767842917","block_type":"box","text":"the Investment Company Act that restricts securities trading in the personal accounts of investment professionals and others who","page_number":540,"box":{"x":45,"y":443,"width":894,"height":13}},{"id":"d15ad06e-7263-4bb2-b6c1-2cf93006b76b","block_type":"box","text":"normally come into possession of information regarding the Fund’s portfolio transactions. Each Code of Ethics is also available on","page_number":540,"box":{"x":45,"y":459,"width":906,"height":12}},{"id":"dc4287d7-3863-4314-8703-e8aa53f86583","block_type":"box","text":"the EDGAR Database on the Commission’s Internet site at http://www.sec.gov, and copies may be obtained, after paying a","page_number":540,"box":{"x":45,"y":474,"width":853,"height":13}},{"id":"b86b7127-722d-4ef5-ad06-c34c313815e3","block_type":"box","text":"duplicating fee, by e-mail at publicinfo@sec.gov.","page_number":540,"box":{"x":46,"y":490,"width":333,"height":12}},{"id":"ea0e20d7-bfe8-40b4-b65b-78e4f3342712","block_type":"box","text":"BlackRock will not purchase securities or other property from, or sell securities or other property to, a Fund, except that the Fund","page_number":540,"box":{"x":46,"y":513,"width":901,"height":13}},{"id":"ed7a295c-8838-411e-93ba-81706fb0785b","block_type":"box","text":"may in accordance with rules or guidance adopted under the Investment Company Act engage in transactions with another Fund","page_number":540,"box":{"x":45,"y":528,"width":895,"height":13}},{"id":"86a45ea9-fc77-48b2-8636-bfe6fa80e95f","block_type":"box","text":"or accounts that are affiliated with the Fund as a result of common officers, directors, or investment advisers or pursuant to","page_number":540,"box":{"x":46,"y":544,"width":856,"height":13}},{"id":"5809e8ef-a6cd-4543-851a-9b106f8990a6","block_type":"box","text":"exemptive orders granted to the Funds and/or BlackRock b","page_number":540,"box":{"x":46,"y":559,"width":409,"height":13}},{"id":"59be4b01-69d3-45b4-be61-75c6e64d5dc4","block_type":"box","text":"y the Commission. These transactions would be effected in","page_number":540,"box":{"x":456,"y":559,"width":408,"height":13}},{"id":"1a9f9df0-f131-4384-b6ca-1c58d75a5297","block_type":"box","text":"circumstances in which BlackRock determined that it would be appropriate for the Fund to purchase and another client of","page_number":540,"box":{"x":45,"y":575,"width":851,"height":13}},{"id":"d6bdff79-2f1e-406f-96ef-e2a4577e02ef","block_type":"box","text":"BlackRock to sell, or the Fund to sell and another client of BlackRock to purchase, the same security or instrument on the same","page_number":540,"box":{"x":46,"y":590,"width":883,"height":13}},{"id":"c6bfed34-5c69-479d-ae46-7b43e072650b","block_type":"box","text":"day. From time to time, the activities of a Fund may be restricted b","page_number":540,"box":{"x":46,"y":606,"width":462,"height":13}},{"id":"3d969fcc-4054-4511-8dcd-069a22cc1cf8","block_type":"box","text":"ecause of regulatory requirements applicable to BlackRock and/","page_number":540,"box":{"x":509,"y":606,"width":443,"height":13}},{"id":"1ab2795c-37a1-4599-b9e5-1e802675ce0d","block_type":"box","text":"or BlackRock’s internal policies designed to comply with, limit th","page_number":540,"box":{"x":46,"y":621,"width":453,"height":13}},{"id":"70d56702-7719-44b0-97cb-a3907c18f919","block_type":"box","text":"e applicability of, or that otherwise relate to such requirements.","page_number":540,"box":{"x":499,"y":621,"width":439,"height":13}},{"id":"64a3e7c5-8b20-4cff-8132-cbf20052384b","block_type":"box","text":"A client not advised by BlackRock would not be subject to some of","page_number":540,"box":{"x":45,"y":637,"width":467,"height":13}},{"id":"01c17d2b-a856-4c52-943d-61d3aadbec61","block_type":"box","text":"those considerations. There may be periods when BlackRock","page_number":540,"box":{"x":516,"y":637,"width":422,"height":13}},{"id":"de284629-a98b-4b40-85d3-ebab0f0c7f57","block_type":"box","text":"may not initiate or recommend certain types of transactions, or may otherwise restrict or limit its advice regarding certain","page_number":540,"box":{"x":45,"y":652,"width":843,"height":13}},{"id":"f0a2f6cc-a02f-446f-9bc5-82e9f607ffc8","block_type":"box","text":"securities or instruments issued by or related to companies for wh","page_number":540,"box":{"x":46,"y":668,"width":454,"height":13}},{"id":"0b4b49e2-44b5-42f1-b27a-4a1d58b6e11d","block_type":"box","text":"ich BlackRock is performing advisory or other services or has","page_number":540,"box":{"x":501,"y":668,"width":425,"height":13}},{"id":"20821b6e-b6c5-4c11-ba17-157253330e64","block_type":"box","text":"proprietary positions. 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Therefore, BlackRock may not be able to review","page_number":541,"box":{"x":524,"y":244,"width":420,"height":12}},{"id":"3f18f9ee-0625-4f9d-8a72-f8f5bdaa0e79","block_type":"box","text":"potential investments for the Funds with the benefit of information held by certain areas of BlackRock.","page_number":541,"box":{"x":45,"y":259,"width":714,"height":13}},{"id":"e4021716-38bd-4565-b812-4a842891fa52","block_type":"box","text":"BlackRock may determine to move certain personnel, businesses, or business units from one side of an information barrier to the","page_number":541,"box":{"x":46,"y":284,"width":893,"height":13}},{"id":"88d4f2e5-3110-4172-a9fa-f4771c909c9d","block_type":"box","text":"other side of the information barrier. In connection there","page_number":541,"box":{"x":46,"y":300,"width":393,"height":10}},{"id":"9e119ded-c456-4872-9a60-00854d395476","block_type":"box","text":"with, BlackRock personnel, businesses, and business units that were","page_number":541,"box":{"x":440,"y":300,"width":471,"height":13}},{"id":"3a8ada17-0806-48fd-a042-090f962c461a","block_type":"box","text":"moved will no longer have access to the information and personnel from the side of the information barrier from which they were","page_number":541,"box":{"x":45,"y":315,"width":901,"height":13}},{"id":"626f4ee4-7423-4ff2-afb5-0ec7e94c23ff","block_type":"box","text":"moved. 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Such","page_number":543,"box":{"x":498,"y":526,"width":450,"height":13}},{"id":"cbd646a1-4465-4a2d-8b3d-d643edbbe7db","block_type":"box","text":"Authorized Persons are authorized to designate other interm","page_number":543,"box":{"x":45,"y":542,"width":418,"height":13}},{"id":"4606e72c-100c-4b47-8066-5cbaccc5e701","block_type":"box","text":"ediaries to receive purchase and redemption orders on the Fund’s","page_number":543,"box":{"x":464,"y":542,"width":451,"height":13}},{"id":"56180a60-2264-48f8-af47-69c17ad7b1cb","block_type":"box","text":"behalf, and the Fund will be deemed to have received a purchase or red","page_number":543,"box":{"x":46,"y":557,"width":492,"height":13}},{"id":"6bd3ec35-5dcd-4b4c-9fc4-404f81a325e6","block_type":"box","text":"emption order when an Authorized Person or, if applicable,","page_number":543,"box":{"x":539,"y":557,"width":413,"height":13}},{"id":"65d35b04-656b-4028-8791-4fef68cfda28","block_type":"box","text":"such Authorized Person’s authorized designee, receives the ord","page_number":543,"box":{"x":46,"y":573,"width":432,"height":13}},{"id":"dc1ab2ba-81b5-415d-a48b-98be3c35f2bd","block_type":"box","text":"er. 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Financial institutions","page_number":543,"box":{"x":508,"y":588,"width":434,"height":13}},{"id":"59ba41f1-4eee-437c-9f3c-4a269f3a56f0","block_type":"box","text":"may include retirement plan service providers who aggregat","page_number":543,"box":{"x":45,"y":604,"width":414,"height":13}},{"id":"bd6c29b5-2f9e-40b9-b581-80e2c3fe2058","block_type":"box","text":"e purchase and redemption instructions received from numerous","page_number":543,"box":{"x":460,"y":604,"width":445,"height":13}},{"id":"9cea6481-999b-4fff-a799-bbc771757737","block_type":"box","text":"retirement plans or plan participants.","page_number":543,"box":{"x":45,"y":619,"width":257,"height":13}},{"id":"8bca752a-807f-4f6f-8998-a042638a9b0d","block_type":"box","text":"Investor A and Investor C Shares","page_number":543,"box":{"x":45,"y":650,"width":241,"height":10}},{"id":"25c9e4b0-b50b-49f4-923f-60f3b322c02a","block_type":"box","text":"Purchase of Investor A Shares.","page_number":543,"box":{"x":45,"y":676,"width":210,"height":10}},{"id":"9b0a254c-4c1e-459e-b8bb-f187375937ef","block_type":"box","text":"The minimum investment for the initial purchase of shares is $1,000. There is no investment","page_number":543,"box":{"x":261,"y":675,"width":640,"height":13}},{"id":"f54767bc-37a9-456d-ab9c-3f121002117c","block_type":"box","text":"minimum for employer-sponsored retirement plans (not includi","page_number":543,"box":{"x":45,"y":691,"width":439,"height":13}},{"id":"cfc24cff-caf3-4d02-b924-590b18e486c3","block_type":"box","text":"ng SEP IRAs, SIMPLE IRAs or SARSEPs). There is no investment","page_number":543,"box":{"x":485,"y":691,"width":455,"height":13}},{"id":"e43e2c2d-9eaf-46de-a3d8-274cacd63446","block_type":"box","text":"minimum for certain fee-based programs. There is a $50 minimu","page_number":543,"box":{"x":45,"y":706,"width":450,"height":13}},{"id":"e28460d5-72f2-4dd4-88e5-e94f4e6571ca","block_type":"box","text":"m for subsequent investments (with the exception of certain","page_number":543,"box":{"x":496,"y":707,"width":414,"height":12}},{"id":"1ff447f3-3e9e-4c56-81c9-f503c8e7fd66","block_type":"box","text":"employer-sponsored retirement plans which may have a lower mini","page_number":543,"box":{"x":46,"y":722,"width":466,"height":13}},{"id":"34d3dcef-5501-4249-8c5b-ad9b6f96c03c","block_type":"box","text":"mum). Purchases through the Automatic Investment Plan are","page_number":543,"box":{"x":513,"y":722,"width":423,"height":13}},{"id":"523e1338-2beb-4e0a-bf66-e4b829bb9c36","block_type":"box","text":"subject to a lower initial purchase minimum. In addition, the m","page_number":543,"box":{"x":46,"y":738,"width":439,"height":12}},{"id":"bec39a02-e420-4368-9dcb-fadd6686a49a","block_type":"box","text":"inimum initial investment for employees of the Fund, the Fund’s","page_number":543,"box":{"x":485,"y":738,"width":444,"height":12}},{"id":"5b6131cb-67bb-4988-b534-a6056f52bbcc","block_type":"box","text":"Manager, sub-adviser, BRIL or transfer agent or employees of their affiliates is $100, unless payment is made through a payroll","page_number":543,"box":{"x":45,"y":753,"width":883,"height":13}},{"id":"aa2e421f-14c1-4db7-9e18-0be6ddc9f3ac","block_type":"box","text":"deduction program in which case the minimum investment is $25.","page_number":543,"box":{"x":46,"y":768,"width":457,"height":13}},{"id":"a5a25c4f-f904-4b62-809d-325e5a85412a","block_type":"box","text":"Purchases of Investor A Shares Through Brokers.","page_number":543,"box":{"x":45,"y":792,"width":342,"height":12}},{"id":"27bd3257-21c1-494d-8f88-12f1ac7dabe0","block_type":"box","text":"It is the responsibility of brokers to transmit purchase orders and payment on a","page_number":543,"box":{"x":393,"y":792,"width":549,"height":12}},{"id":"f413cee4-662a-4b65-9520-4b70748e3ecc","block_type":"box","text":"timely basis. 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BRIL maintains its","page_number":543,"box":{"x":251,"y":861,"width":640,"height":13}},{"id":"1b49b701-453b-4b32-847c-87e5d5f090db","block_type":"box","text":"principal offices at 50 Hudson Yards, New York, New York 10001. Purchases may be effected on weekdays on which the NYSE","page_number":543,"box":{"x":45,"y":877,"width":898,"height":13}},{"id":"40063a6a-366e-4768-8054-65e1daeae2c9","block_type":"box","text":"II-33","page_number":543,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"e659063b-61e3-44a6-a67b-4873b8425336","block_type":"box","text":"NM1026U-6004382-543/605","page_number":543,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"e6cb571b-2f97-45ce-9d2f-a52836394a07","block_type":"box","text":"is open for business (a “Business Day”). 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However, a contingent deferred","page_number":544,"box":{"x":46,"y":226,"width":875,"height":13}},{"id":"40fd5aec-4c71-4706-a1fb-713de07650a6","block_type":"box","text":"sales charge (“CDSC”) will be charged in connection with the redemption of the Investor C Shares of the Non-Money Market","page_number":544,"box":{"x":46,"y":242,"width":875,"height":12}},{"id":"4e923912-bcdf-4dbe-b9f2-b2ebda3393c9","block_type":"box","text":"Portfolio received in the exchange.","page_number":544,"box":{"x":45,"y":257,"width":238,"height":13}},{"id":"32058b92-e67e-4d45-9e64-a2917a6d92f8","block_type":"box","text":"A CDSC of 1.00% may apply to certain redemptions of Investor C Shares of Summit Cash Reserves. The Investor C Shares CDSC","page_number":544,"box":{"x":45,"y":280,"width":905,"height":13}},{"id":"c794a289-8297-4f31-a871-6776216d386d","block_type":"box","text":"is only charged upon redemptions of Investor C Shares within one year after you originally acquired the Investor C Shares of the","page_number":544,"box":{"x":45,"y":296,"width":890,"height":13}},{"id":"0fa2d766-3f70-4423-ae28-cff957d0de28","block_type":"box","text":"Non-Money Market Portfolio, unless you qualify for a waiver. There is no CDSC charged on redemptions if you have owned your","page_number":544,"box":{"x":45,"y":311,"width":908,"height":13}},{"id":"cc4f3c43-f153-442c-8b94-9a73f79d0fc5","block_type":"box","text":"Investor C Shares for more than one year (as measured from your original purchase of Investor C Shares that you exchanged into","page_number":544,"box":{"x":45,"y":327,"width":897,"height":13}},{"id":"5fca1891-6b52-4fba-a19f-bc92d0902c84","block_type":"box","text":"Investor C Shares of Summit Cash Reserves). In determining whether an Investor C Shares CDSC is applicable to a redemption,","page_number":544,"box":{"x":45,"y":342,"width":885,"height":13}},{"id":"c20a4790-68c8-45ff-abd7-9930e1e6a1f9","block_type":"box","text":"the calculation will be determined in the manner that results in","page_number":544,"box":{"x":45,"y":358,"width":435,"height":10}},{"id":"e55beae7-23ab-469e-8045-92b22c0774c7","block_type":"box","text":"the lowest possible rate being charged. The charge will be assessed","page_number":544,"box":{"x":484,"y":358,"width":460,"height":13}},{"id":"e1bfaf28-a7b2-4bcc-8739-6c662ba92e38","block_type":"box","text":"on an amount equal to the lesser of the proceeds of redemption or the cost of the shares being redeemed. Accordingly, no CDSC","page_number":544,"box":{"x":46,"y":373,"width":888,"height":13}},{"id":"62a922a7-638e-4ddc-847b-b8d768ec6c61","block_type":"box","text":"will be imposed on increases in NAV above the initial purchase price of Investor C Shares. In addition, no CDSC will be assessed","page_number":544,"box":{"x":45,"y":389,"width":894,"height":13}},{"id":"090c0d1c-db5b-479b-ba17-433660781eed","block_type":"box","text":"on Investor C Shares acquired through reinvestment of dividends. It will be assumed that the redemption is first of shares held for","page_number":544,"box":{"x":46,"y":404,"width":897,"height":13}},{"id":"4d5612a0-ec05-4c8c-84e7-24bb011a245f","block_type":"box","text":"over one year or shares acquired pursuant to reinvestment of divi","page_number":544,"box":{"x":46,"y":420,"width":451,"height":13}},{"id":"8da0404f-8be4-4ba6-9630-e0c7a610f569","block_type":"box","text":"dends and then of shares held longest during the one-year period.","page_number":544,"box":{"x":498,"y":420,"width":451,"height":13}},{"id":"cd02ae19-8607-4479-92e1-2194f27aed8f","block_type":"box","text":"A transfer of shares from a shareholder’s account to another account will be assumed to be made in the same order as a","page_number":544,"box":{"x":45,"y":435,"width":830,"height":10}},{"id":"3ce39845-bea2-43b8-a00f-b52f9154e9f4","block_type":"box","text":"redemption.","page_number":544,"box":{"x":45,"y":451,"width":83,"height":13}},{"id":"461bad3a-29f5-4f15-8b35-d75d15a7ca4e","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Part I of the Fund’s SAI for information about amounts","page_number":544,"box":{"x":46,"y":474,"width":902,"height":13}},{"id":"76702576-2266-4d4c-9c19-d2fb4002b63f","block_type":"box","text":"paid to the Distributor in connection with CDSC shares for the periods indicated.","page_number":544,"box":{"x":45,"y":490,"width":565,"height":12}},{"id":"328152e8-4a85-4145-8a78-7703a4a6684b","block_type":"box","text":"The CDSC on Investor C Shares is not charged in connection with: (1) redemptions of Investor C Shares purchased through","page_number":544,"box":{"x":45,"y":513,"width":859,"height":13}},{"id":"06612986-38cb-4613-b3af-d719d9e94324","block_type":"box","text":"certain employer-sponsored retirement plans and fee-based programs previously approved by certain Funds and rollovers of","page_number":544,"box":{"x":45,"y":528,"width":860,"height":13}},{"id":"cc2b9b3f-3f4a-485e-a255-e4b8bbf4ed1b","block_type":"box","text":"current investments in the Fund through such plans; 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(5) redemptions","page_number":544,"box":{"x":45,"y":590,"width":435,"height":13}},{"id":"42710f90-4d6c-4030-8c0d-4dd553070b1e","block_type":"box","text":"in connection with a shareholder’s death as long as the waiver","page_number":544,"box":{"x":485,"y":590,"width":430,"height":13}},{"id":"bc8d97b5-bbd9-4789-9d59-ec782fc4035f","block_type":"box","text":"request is made within one year of death or, if later, reasonably promptly following completion of probate (including in","page_number":544,"box":{"x":45,"y":606,"width":830,"height":13}},{"id":"2ba7de9f-38df-4a3d-8593-611bafd64fa8","block_type":"box","text":"connection with the distribution of account assets to a benefic","page_number":544,"box":{"x":45,"y":621,"width":429,"height":10}},{"id":"4f188aaf-3f69-4dc2-9c09-6c2a1c4cd403","block_type":"box","text":"iary of the decedent) or disability (as defined in the Code)","page_number":544,"box":{"x":475,"y":621,"width":397,"height":13}},{"id":"6c3056a2-91f3-442a-aab8-07bc93836159","block_type":"box","text":"subsequent to the purchase of Investor C Shares; (6) withdrawals resulting from shareholder disability (as defined in the Code) as","page_number":544,"box":{"x":46,"y":637,"width":895,"height":13}},{"id":"40a88550-e48e-4327-831f-77b7265a01b0","block_type":"box","text":"long as the disability arose subsequent to the purchase of the shares; (7) involuntary redemptions of Investor C Shares in accounts","page_number":544,"box":{"x":45,"y":652,"width":899,"height":13}},{"id":"d9a1bcd4-d945-488b-9b60-d0bcf0bffb3a","block_type":"box","text":"with low balances as described in “Redemption of Shares” below;","page_number":544,"box":{"x":45,"y":668,"width":458,"height":13}},{"id":"4efb669f-be55-459a-9428-7a74181ea6f1","block_type":"box","text":"(8) redemptions made pursuant to a systematic withdrawal","page_number":544,"box":{"x":509,"y":668,"width":409,"height":13}},{"id":"70dc413f-215c-4c2f-9f11-8d7d1369233a","block_type":"box","text":"plan, subject to the limitations set forth under “Systematic Withdr","page_number":544,"box":{"x":45,"y":683,"width":459,"height":13}},{"id":"30361d31-deab-4275-9cc6-e2e4300d41ba","block_type":"box","text":"awal Plan” below; (9) redemptions related to the payment of","page_number":544,"box":{"x":505,"y":683,"width":422,"height":13}},{"id":"a985bb0f-abfc-43fb-9c0f-702c6c78a690","block_type":"box","text":"BNY Mellon Investment Servicing Trust Company custodial IRA","page_number":544,"box":{"x":46,"y":699,"width":452,"height":13}},{"id":"215d689d-8129-46ce-a462-3509e0a01244","block_type":"box","text":"fees; and (10) redemptions when a shareholder can demonstrate","page_number":544,"box":{"x":503,"y":699,"width":443,"height":13}},{"id":"b87c8df1-c06e-4375-9c99-12f36b4e3dee","block_type":"box","text":"hardship, in the absolute discretion of the Fund. In addition, no CDSC is charged on Investor C Shares acquired through the","page_number":544,"box":{"x":45,"y":714,"width":862,"height":13}},{"id":"b48c0fc4-6622-4ff9-b107-df52e6383465","block_type":"box","text":"reinvestment of dividends or distributions.","page_number":544,"box":{"x":45,"y":730,"width":293,"height":10}},{"id":"808d1670-71cb-4ad0-89a8-f81b44d6664d","block_type":"box","text":"Certain CDSC waivers and reductions on Investor C Shares may be","page_number":544,"box":{"x":46,"y":753,"width":467,"height":13}},{"id":"9626b08a-3ae4-427f-bdc5-c2fd045dc562","block_type":"box","text":"available to customers of certain financial intermediaries, as","page_number":544,"box":{"x":518,"y":753,"width":414,"height":13}},{"id":"e5f6cd8b-8703-474a-82ef-03e3f5d24646","block_type":"box","text":"described under “Intermediary-Defined Sales Charge Waiver Polic","page_number":544,"box":{"x":46,"y":769,"width":458,"height":13}},{"id":"c02e3577-96a7-41ae-aa7d-9b55d172aae8","block_type":"box","text":"ies” in the Fund’s Prospectus. Please speak to your financial","page_number":544,"box":{"x":505,"y":769,"width":413,"height":13}},{"id":"78e4ef56-d791-4e88-875a-f2a0d2faa070","block_type":"box","text":"intermediary for more information.","page_number":544,"box":{"x":45,"y":784,"width":245,"height":13}},{"id":"a5b85135-ad26-42ef-9ddb-8cd943216ced","block_type":"box","text":"A shareholder wishing to make an exchange may do so by sending a written request to the Fund at the following address:","page_number":544,"box":{"x":45,"y":807,"width":843,"height":13}},{"id":"f8207e65-8f6a-4899-84bf-113877ad0e17","block_type":"box","text":"BlackRock, P.O. Box 534429, Pittsburgh, Pennsylvania 15253-4429. Shareholders are automatically provided with telephone","page_number":544,"box":{"x":46,"y":823,"width":873,"height":13}},{"id":"487914d8-ced5-43ca-95d9-82ab956aa166","block_type":"box","text":"exchange privileges when opening an account, unless they indicate on the Application that they do not wish to use this privilege.","page_number":544,"box":{"x":46,"y":838,"width":888,"height":13}},{"id":"c67b8424-e88c-450e-9c87-20f833bfaab0","block_type":"box","text":"To add this feature to an existing account that previously did not provide this option, a request must be made in writing or by","page_number":544,"box":{"x":45,"y":854,"width":875,"height":13}},{"id":"c741d270-26b8-4139-85c9-81049d5deda9","block_type":"box","text":"telephone. Once this election has been made, the sharehol","page_number":544,"box":{"x":45,"y":869,"width":400,"height":13}},{"id":"006e77e0-e817-41f3-b1cf-f6a8e82992b2","block_type":"box","text":"der may simply contact the Fund by telephone at (800) 441-7762 to","page_number":544,"box":{"x":446,"y":869,"width":472,"height":13}},{"id":"43b8277a-147b-4065-8832-3fadb97b61fd","block_type":"box","text":"II-34","page_number":544,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"3bcc7aa4-03b8-4d5d-8516-a92b341ba93c","block_type":"box","text":"NM1026U-6004382-544/605","page_number":544,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"35e96b81-1a91-4829-a862-6d0bfda67dd6","block_type":"box","text":"request the exchange. During periods of substantial economic or market change, telephone exchanges may be difficult to complete","page_number":545,"box":{"x":45,"y":79,"width":904,"height":13}},{"id":"7090340d-658c-4cf5-bf51-0684a9e71a81","block_type":"box","text":"and shareholders may have to submit exchange requests in writing.","page_number":545,"box":{"x":46,"y":94,"width":464,"height":13}},{"id":"eae1b845-e103-4d6e-bf83-0aa4c9d0e7e8","block_type":"box","text":"If the exchanging shareholder does not currently own shares of the investment portfolio whose shares are being acquired, a new","page_number":545,"box":{"x":45,"y":118,"width":887,"height":12}},{"id":"56fdc498-d0ec-4f4a-b136-4c19d6bbfa2e","block_type":"box","text":"account will be established with the same registration, dividend and capital gain options and broker of record as the account from","page_number":545,"box":{"x":46,"y":133,"width":901,"height":13}},{"id":"8ed91b67-4e5f-476d-818e-eaf74024ae04","block_type":"box","text":"which shares are exchanged, unless otherwise specified in writing b","page_number":545,"box":{"x":45,"y":149,"width":465,"height":12}},{"id":"a32a9221-d2f1-4969-b867-c5fd83401daa","block_type":"box","text":"y the shareholder with all signatures guaranteed by an “eligible","page_number":545,"box":{"x":511,"y":149,"width":437,"height":12}},{"id":"717d3c25-e03d-41b8-8bd1-fb599fa6e9d8","block_type":"box","text":"guarantor institution” as defined in Rule 17Ad-15 under the Exchange Act. In order to participate in the Automatic Investment","page_number":545,"box":{"x":45,"y":164,"width":884,"height":13}},{"id":"b36e02ba-b644-4203-b31f-055aa2877b12","block_type":"box","text":"Program or establish a Systematic Withdrawal Plan for the new account, however, an exchanging shareholder must file a specific","page_number":545,"box":{"x":45,"y":180,"width":895,"height":12}},{"id":"76343dfa-1780-4ef4-894d-2a627302d5ba","block_type":"box","text":"written request.","page_number":545,"box":{"x":45,"y":196,"width":108,"height":12}},{"id":"1e14cf74-6fdc-4fde-860e-eb337b49cef4","block_type":"box","text":"Any share exchange must satisfy the requirements relating to the minimum initial investment requirement, and must be legally","page_number":545,"box":{"x":45,"y":218,"width":875,"height":13}},{"id":"bba39c68-0b37-478f-bbd2-05572879cd36","block_type":"box","text":"available for sale in the state of the investor’s residence. For Fed","page_number":545,"box":{"x":46,"y":234,"width":441,"height":10}},{"id":"f739d3ab-7ea8-40e7-811d-fd9d48d92d9b","block_type":"box","text":"eral income tax purposes, a share exchange is a taxable event and,","page_number":545,"box":{"x":488,"y":234,"width":458,"height":13}},{"id":"c488fdd3-4882-4475-8c66-05774b569d68","block_type":"box","text":"accordingly, a capital gain or loss may be realized. Before making an exchange request, shareholders should consult a tax or other","page_number":545,"box":{"x":46,"y":249,"width":900,"height":13}},{"id":"aaaf7950-6c11-413f-afaf-bf11018e5837","block_type":"box","text":"financial adviser and should consider the investment objective, policies and restrictions of the investment portfolio into which the","page_number":545,"box":{"x":45,"y":265,"width":895,"height":13}},{"id":"8d214eb4-374c-40b7-accb-8115aa968a6b","block_type":"box","text":"shareholder is making an exchange. Brokers may charge a fee for handling exchanges.","page_number":545,"box":{"x":46,"y":280,"width":595,"height":13}},{"id":"f3f9c1d4-dc81-4a12-b9b7-c1beed927531","block_type":"box","text":"The Fund reserves the right to suspend, modify or terminate t","page_number":545,"box":{"x":45,"y":304,"width":426,"height":12}},{"id":"bb6547f9-22c2-4bc3-97b1-5f6d97b9b58d","block_type":"box","text":"he exchange privilege at any time. Notice will be given to","page_number":545,"box":{"x":472,"y":304,"width":395,"height":12}},{"id":"710e9c50-8caf-415d-8fa1-82b446c376a5","block_type":"box","text":"shareholders of any material modification or termination ex","page_number":545,"box":{"x":46,"y":319,"width":416,"height":13}},{"id":"de272ca9-7283-41b8-9dc4-516e94bb7675","block_type":"box","text":"cept where notice is not required. The Fund reserves the right to reject","page_number":545,"box":{"x":462,"y":319,"width":485,"height":13}},{"id":"3202354a-f4f3-41de-9095-a54510badbb0","block_type":"box","text":"any telephone exchange request. Telephone exchanges may be subject to limitations as to amount or frequency, and to other","page_number":545,"box":{"x":46,"y":335,"width":863,"height":12}},{"id":"d8706a12-dbb3-4a18-ba65-1f375f73ba63","block_type":"box","text":"restrictions that may be established from time to time to ensure that exchanges do not operate to the disadvantage of any portfolio","page_number":545,"box":{"x":45,"y":350,"width":905,"height":13}},{"id":"c369042d-c47d-4087-8ef8-58a54de67808","block_type":"box","text":"or its shareholders. The Fund, the Administrator and BRIL will employ reasonable procedures to confirm that instructions","page_number":545,"box":{"x":46,"y":366,"width":848,"height":12}},{"id":"49eb4f99-8ed9-4fda-b0bd-1c5de9d2c364","block_type":"box","text":"communicated by telephone are genuine. The Fund, the Trust, t","page_number":545,"box":{"x":45,"y":381,"width":442,"height":13}},{"id":"f3d89213-78b5-44a1-83ea-df2f2ed646c6","block_type":"box","text":"he Administrator(s) and BRIL will not be liable for any loss,","page_number":545,"box":{"x":487,"y":381,"width":416,"height":13}},{"id":"02f9718d-94f4-4df4-9eb6-b6d7277ea111","block_type":"box","text":"liability, cost or expense for acting upon telephone instructions reasonably believed to be genuine in accordance with such","page_number":545,"box":{"x":45,"y":397,"width":846,"height":12}},{"id":"6e84f0e2-eee1-42aa-b41d-94dd87be04a3","block_type":"box","text":"procedures.","page_number":545,"box":{"x":45,"y":412,"width":80,"height":13}},{"id":"32fccfaa-8ce2-4ea7-8625-0afc3acca8f4","block_type":"box","text":"By use of the exchange privilege, the investor authorizes the Fund’s transfer agent to act on telephonic or written exchange","page_number":545,"box":{"x":46,"y":435,"width":848,"height":13}},{"id":"d630f2de-04ae-4d26-a188-8e1ca32ecedc","block_type":"box","text":"instructions from any person representing him- or herself to be the investor and believed by the Fund’s transfer agent to be","page_number":545,"box":{"x":45,"y":451,"width":849,"height":13}},{"id":"c6e9deb8-ba98-4219-83e5-b37f81d64f25","block_type":"box","text":"genuine. The records of the Fund’s transfer agent pertaining to su","page_number":545,"box":{"x":45,"y":466,"width":454,"height":13}},{"id":"52c63db6-04dc-4199-ad3e-5f96d71fb0f3","block_type":"box","text":"ch instructions are binding. The exchange privilege may be","page_number":545,"box":{"x":499,"y":466,"width":407,"height":13}},{"id":"615cef2e-956b-40cf-a01c-0db847f8dec2","block_type":"box","text":"modified or terminated at any time upon 60 days’ notice to affected","page_number":545,"box":{"x":45,"y":482,"width":470,"height":13}},{"id":"27764c5f-fcce-4658-8a27-85358c93cda2","block_type":"box","text":"shareholders. The exchange privilege is only available in states","page_number":545,"box":{"x":520,"y":482,"width":431,"height":13}},{"id":"8be1dbf9-f686-421d-bff0-c923fa814790","block_type":"box","text":"where the exchange may legally be made.","page_number":545,"box":{"x":45,"y":497,"width":287,"height":13}},{"id":"845ecc6b-37c3-4bfe-86bd-3280c1bef243","block_type":"box","text":"The redemption of shares of one fund and the subsequent investment in another fund generally will be treated as two separate","page_number":545,"box":{"x":45,"y":521,"width":874,"height":12}},{"id":"6828f3fa-dda8-49c8-959d-1e7bd60a3482","block_type":"box","text":"transactions. Therefore, a front-end sales charge will be impo","page_number":545,"box":{"x":45,"y":536,"width":425,"height":13}},{"id":"6b42ab2e-10a3-4ac4-85b4-95e064c02942","block_type":"box","text":"sed (unless an exemption applies) on the purchase of Investor A or","page_number":545,"box":{"x":471,"y":536,"width":460,"height":13}},{"id":"a897ce71-5c9b-45dd-b776-a49837c659f2","block_type":"box","text":"Investor A1 Shares of a Non-Money Market Portfolio with the proceeds of a redemption of Investor A Shares of the Fund. In","page_number":545,"box":{"x":45,"y":552,"width":870,"height":12}},{"id":"707cd1d9-37c9-4929-9dba-5bbdbe973d0f","block_type":"box","text":"addition, when Investor C Shares of the Fund are redeemed and the proceeds are used to purchase Investor C Shares of a","page_number":545,"box":{"x":46,"y":567,"width":836,"height":13}},{"id":"7aea0e6e-83b9-4d50-92ca-133907113d03","block_type":"box","text":"Non-Money Market Portfolio, a CDSC will be imposed (unless an exemption applies) when the Investor C Shares of the","page_number":545,"box":{"x":45,"y":583,"width":836,"height":12}},{"id":"5cfed9f4-895e-43a6-9b45-01a8e10d27eb","block_type":"box","text":"Non-Money Market Portfolio are redeemed.","page_number":545,"box":{"x":45,"y":598,"width":310,"height":13}},{"id":"7875e066-b0d9-40f8-9b55-f964b0742a66","block_type":"box","text":"The Fund has adopted an automatic conversion feature for Investor C Shares. Effective November 23, 2020, Investor C Shares","page_number":545,"box":{"x":45,"y":621,"width":879,"height":13}},{"id":"8bb70b44-a6f8-4257-90b6-1e5e4c242260","block_type":"box","text":"held for approximately eight years will be converted into Investor A Shares, as set forth in the Fund’s Prospectus. In addition,","page_number":545,"box":{"x":45,"y":637,"width":868,"height":13}},{"id":"342fc9f9-4491-42ef-b6c3-74f7b043c135","block_type":"box","text":"accounts that do not have a financial intermediary associated with them are not eligible to hold Investor C Shares, and any","page_number":545,"box":{"x":46,"y":652,"width":850,"height":13}},{"id":"8bcc5299-294a-4fa7-a1c9-2ebbf4834026","block_type":"box","text":"Investor C Shares held in such accounts will be automatically converted to Investor A Shares.","page_number":545,"box":{"x":45,"y":668,"width":645,"height":13}},{"id":"91545043-2daf-4e33-9eed-336d6e4e79e1","block_type":"box","text":"A CDSC of up to 1.00% may apply to certain redemptions of Investor A Shares of Summit Cash Reserves purchased in an","page_number":545,"box":{"x":45,"y":691,"width":851,"height":13}},{"id":"a4b9b667-89f6-45c2-b14b-baca7cacfb02","block_type":"box","text":"exchange transaction for Investor A Shares of another mutual fund sponsored and advised by BlackRock or its affiliates","page_number":545,"box":{"x":46,"y":707,"width":830,"height":12}},{"id":"478d2a2d-f0f1-4ebf-ae7b-7e712f5f5e24","block_type":"box","text":"(“BlackRock Fund”) where no initial sales charge was paid at the time of purchase of such fund (each, an “Investor A Load","page_number":545,"box":{"x":46,"y":722,"width":862,"height":13}},{"id":"77644242-2050-4b23-8c16-ba205f98bd18","block_type":"box","text":"Waived BlackRock Portfolio”) as part of an investment of $1,","page_number":545,"box":{"x":45,"y":737,"width":430,"height":13}},{"id":"9f50ecc7-8e24-4e74-b9d0-32478ceb078e","block_type":"box","text":"000,000 (lesser amounts may apply depending on the Investor A","page_number":545,"box":{"x":476,"y":738,"width":448,"height":12}},{"id":"d3be7dc3-531e-40f8-b35c-a0e248392dd1","block_type":"box","text":"Load-Waived BlackRock Portfolio) or more. The Investor A Shares CDSC is only charged upon redemptions of Investor A Shares","page_number":545,"box":{"x":46,"y":753,"width":899,"height":13}},{"id":"0b3478a8-c83f-4e3e-a114-ca51d930d1c2","block_type":"box","text":"within 18 months after you originally acquired such Investor A Shares of the Investor A Load-Waived BlackRock Portfolio (a","page_number":545,"box":{"x":45,"y":769,"width":871,"height":13}},{"id":"89b90942-f9ae-4c1b-b92c-32657f7d679d","block_type":"box","text":"shorter holding period may apply depending on the Invest","page_number":545,"box":{"x":46,"y":784,"width":401,"height":13}},{"id":"f20ed64f-3356-45d5-adf5-05e34c20760a","block_type":"box","text":"or A Load-Waived BlackRock Portfolio), unless you qualify for a","page_number":545,"box":{"x":448,"y":784,"width":452,"height":13}},{"id":"267f980f-a82c-4af1-9801-84751db39576","block_type":"box","text":"waiver. There is no CDSC charged on redemptions if you have owned your Investor A Shares for more than 18 months (or for a","page_number":545,"box":{"x":45,"y":800,"width":891,"height":13}},{"id":"badcea0b-51dc-4768-a3c8-cce89add20d5","block_type":"box","text":"shorter holding period, as applicable) as measured from your original purchase of Investor A Shares that you exchanged into","page_number":545,"box":{"x":46,"y":815,"width":864,"height":13}},{"id":"a872b058-1225-4ccf-af04-a7298a233a4e","block_type":"box","text":"Investor A Shares of Summit Cash Reserves or if you purchase Investor A Shares of Summit Cash Reserves not through an","page_number":545,"box":{"x":45,"y":831,"width":849,"height":13}},{"id":"06933407-2ba2-4648-9c5e-c2f5e92705af","block_type":"box","text":"exchange. The deferred sales charge on Investor A Shares is not charged in connection with: (a) redemptions of Investor A Shares","page_number":545,"box":{"x":46,"y":846,"width":894,"height":13}},{"id":"e185bff1-1312-478a-b74f-26d3a036b90e","block_type":"box","text":"purchased through certain employer-sponsored retirement pla","page_number":545,"box":{"x":45,"y":862,"width":429,"height":13}},{"id":"2961fc3a-4595-477b-87dc-23356a61cfe0","block_type":"box","text":"ns and rollovers of current investments in a Fund through such","page_number":545,"box":{"x":475,"y":862,"width":436,"height":13}},{"id":"330055bd-3a1e-4005-b1a7-84c4fd231a11","block_type":"box","text":"plans; (b) exchanges pursuant to the exchange privilege describe","page_number":545,"box":{"x":45,"y":877,"width":444,"height":13}},{"id":"920c17a3-4fee-4f0c-8016-f9c6bdf7430b","block_type":"box","text":"d in the Fund’s Prospectus; (c) redemptions made in connection","page_number":545,"box":{"x":490,"y":877,"width":439,"height":13}},{"id":"fca8e983-2e98-4885-aa58-f37f24f0daaf","block_type":"box","text":"II-35","page_number":545,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"be417be8-6f0f-4c80-b004-1a40fbb5368e","block_type":"box","text":"NM1026U-6004382-545/605","page_number":545,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5a2855c0-3558-476b-a86a-e47c82d79c84","block_type":"box","text":"with minimum required distributions due to the shareholder rea","page_number":546,"box":{"x":45,"y":79,"width":443,"height":13}},{"id":"a827a165-57f4-4788-8662-72850172f976","block_type":"box","text":"ching age 72 from IRA and 403(b)(7) accounts; (d) redemptions","page_number":546,"box":{"x":489,"y":79,"width":444,"height":13}},{"id":"e65dc418-d6b5-4a6a-843e-61126c5a87a2","block_type":"box","text":"made with respect to certain retirement plans sponsored by BlackRock or its affiliates; (e) redemptions (i) within one year of a","page_number":546,"box":{"x":45,"y":94,"width":873,"height":13}},{"id":"0e98c43d-7993-4113-b1c2-9109cfbfcdaa","block_type":"box","text":"shareholder’s death or, if later, the receipt of a certified probate settlement (including in connection with the distribution of","page_number":546,"box":{"x":46,"y":110,"width":852,"height":13}},{"id":"e0d88cf6-5048-4169-a64a-499b6e0fb49d","block_type":"box","text":"account assets to a beneficiary of the decedent) or (ii) in connection with a shareholder’s disability (as defined in the Code)","page_number":546,"box":{"x":46,"y":125,"width":846,"height":13}},{"id":"c3ceed8c-c367-47e3-8135-6e3c97141aca","block_type":"box","text":"subsequent to the purchase of Investor A Shares; (f) involuntary redemptions of Investor A Shares in accounts with low balances;","page_number":546,"box":{"x":46,"y":141,"width":893,"height":13}},{"id":"2837733c-2b18-4ab7-976e-f2a9ca7f5fa5","block_type":"box","text":"(g) certain redemptions made pursuant to the Systematic Withdr","page_number":546,"box":{"x":46,"y":156,"width":445,"height":13}},{"id":"f8244fa2-215c-406a-a737-72196f58f58b","block_type":"box","text":"awal Plan (described below); (h) redemptions related to the","page_number":546,"box":{"x":492,"y":156,"width":409,"height":13}},{"id":"7112373d-ef1b-4bfb-8526-8f4199b4351f","block_type":"box","text":"payment of BNY Mellon Investment Servicing Trust Company custodial IRA fees; and (i) redemptions when a shareholder can","page_number":546,"box":{"x":45,"y":172,"width":880,"height":13}},{"id":"30d2aa75-0e89-47e5-97cb-d930e1edb840","block_type":"box","text":"demonstrate hardship, in the absolute discretion of a Fund.","page_number":546,"box":{"x":46,"y":187,"width":408,"height":13}},{"id":"f9ccae09-e404-4f04-85c2-a46053374e3e","block_type":"box","text":"If a holder of Investor A Shares of the Fund subsequently exchanges back into the same class of shares of the original affiliated","page_number":546,"box":{"x":45,"y":210,"width":876,"height":12}},{"id":"fccac4f0-6463-4705-a6d1-72c657cc2fa9","block_type":"box","text":"fund it will do so without paying any sales charge. If a holder of Investor A Shares of the Fund exchanges into Investor A Shares of","page_number":546,"box":{"x":45,"y":225,"width":908,"height":13}},{"id":"5f100143-102f-493e-9d49-7fc6bd1ff675","block_type":"box","text":"another affiliated fund, the holder will be required to pay a sales charge equal to the difference, if any, between the sales charge","page_number":546,"box":{"x":46,"y":241,"width":880,"height":12}},{"id":"2a213667-c769-4586-adee-65353c273dfb","block_type":"box","text":"previously paid on the shares of the original affiliated fund and the sales charge payable at the time of the exchange on the shares","page_number":546,"box":{"x":45,"y":256,"width":895,"height":13}},{"id":"e173091c-5440-495d-ab17-29c08e08792b","block_type":"box","text":"of the new affiliated fund.","page_number":546,"box":{"x":46,"y":272,"width":178,"height":10}},{"id":"b8cf08a6-2f8a-42bf-9cd6-eb2468ec2f2e","block_type":"box","text":"It is contemplated that the exchange privilege may be applicable to other new mutual funds whose shares are distributed by the","page_number":546,"box":{"x":45,"y":294,"width":882,"height":13}},{"id":"e4be6099-b420-4c68-9a4c-8f7d7bd61b22","block_type":"box","text":"Distributor.","page_number":546,"box":{"x":45,"y":309,"width":81,"height":10}},{"id":"b1d9497a-b6e8-497f-ae67-b6c2186f0070","block_type":"box","text":"Under the exchange privilege, exchanges are made on the basis of the relative NAVs of the shares being exchanged. Shares issued","page_number":546,"box":{"x":45,"y":331,"width":895,"height":13}},{"id":"cfaa2507-6a46-426f-871b-7d2fb61f300c","block_type":"box","text":"pursuant to dividend reinvestment are sold on a no-load basis in each of the affiliated funds. For purposes of the exchange","page_number":546,"box":{"x":45,"y":347,"width":847,"height":13}},{"id":"3cde7477-e8d0-4235-b0a3-007ca29a376a","block_type":"box","text":"privilege, dividend reinvestment shares shall be deemed to have","page_number":546,"box":{"x":45,"y":362,"width":437,"height":13}},{"id":"d53c6066-97a1-494f-bd97-766dbcbf7413","block_type":"box","text":"been sold with a sales charge equal to the sales charge previously","page_number":546,"box":{"x":488,"y":362,"width":448,"height":13}},{"id":"09de092d-60bb-4616-88ef-f38748b17652","block_type":"box","text":"paid on the shares on which the dividend was paid. Based on this formula an exchange of Investor A Shares of the Fund for","page_number":546,"box":{"x":45,"y":378,"width":857,"height":13}},{"id":"4d4c6015-1e83-4b61-a66e-8d0a40409692","block_type":"box","text":"Investor A Shares of an affiliated fund generally will require the payment of a sales charge equal to the difference, if any, between","page_number":546,"box":{"x":45,"y":394,"width":896,"height":12}},{"id":"9b5b04f1-1b8f-48c2-afa7-4d8eed462ee8","block_type":"box","text":"the sales charge previously paid on the Investor A Shares originally exchanged for Investor A Shares of the Fund and the sales","page_number":546,"box":{"x":45,"y":409,"width":869,"height":13}},{"id":"40ff43bb-1431-4050-b9b6-532686fc2b0a","block_type":"box","text":"charge that may be payable at the time of the exchange on the Investor A Shares of the affiliated fund to be acquired.","page_number":546,"box":{"x":45,"y":425,"width":811,"height":12}},{"id":"5ca742c8-1ef1-4e56-b427-e4e8bfadc457","block_type":"box","text":"Before effecting an exchange, shareholders of the Fund should obtain a currently effective prospectus of the affiliated fund into","page_number":546,"box":{"x":46,"y":447,"width":877,"height":13}},{"id":"589a12fb-603c-4d54-b6c3-46165286e5b1","block_type":"box","text":"which the exchange is to be made for information regarding the fund and for further details regarding such exchange.","page_number":546,"box":{"x":45,"y":462,"width":815,"height":13}},{"id":"aafbc174-d386-42cf-9a1b-4defe8249c7e","block_type":"box","text":"To effect an exchange, shareholders should contact their financial","page_number":546,"box":{"x":45,"y":484,"width":455,"height":13}},{"id":"82a27ed6-2af7-47eb-9c00-58dc94c8ac47","block_type":"box","text":"adviser, selected securities dealer or other financial intermediary,","page_number":546,"box":{"x":506,"y":484,"width":446,"height":13}},{"id":"cb6b0b03-0a51-475e-a0e8-06135c3f7128","block_type":"box","text":"who will advise the Fund of the exchange, or write to the Fund’s transfer agent requesting that the exchange be effected.","page_number":546,"box":{"x":45,"y":500,"width":833,"height":13}},{"id":"6adc822c-22ae-4378-9453-59023a0b9dd3","block_type":"box","text":"Shareholders of certain affiliated funds with shares for which certificates have not been issued may effect an exchange by wire","page_number":546,"box":{"x":46,"y":515,"width":871,"height":13}},{"id":"5c448b28-fea0-4d4f-b2b3-9a4206d051e9","block_type":"box","text":"through their securities dealers. The exchange privilege may be m","page_number":546,"box":{"x":45,"y":531,"width":453,"height":13}},{"id":"ee3b61f9-67f0-4440-82ae-cc7685276bec","block_type":"box","text":"odified or terminated at any time in accordance with the rules of","page_number":546,"box":{"x":499,"y":531,"width":447,"height":13}},{"id":"dc1d41fd-0e7d-4228-b349-dd278235c5db","block_type":"box","text":"the Commission. There is currently no limitation on the number of","page_number":546,"box":{"x":45,"y":546,"width":465,"height":13}},{"id":"c57c722b-2403-4245-8a8a-4726b8b92ede","block_type":"box","text":"times a shareholder may effect an exchange into the Fund","page_number":546,"box":{"x":514,"y":546,"width":399,"height":13}},{"id":"34f0dc91-5bf3-499d-8147-3d218a803851","block_type":"box","text":"through the exchange privilege; however, the Fund reserves the r","page_number":546,"box":{"x":45,"y":562,"width":448,"height":13}},{"id":"4157fed1-00b3-4389-b988-799590237d3e","block_type":"box","text":"ight to limit the number of times an investor may effect an","page_number":546,"box":{"x":493,"y":562,"width":404,"height":13}},{"id":"cd471488-1094-4848-9553-893fefc4952e","block_type":"box","text":"exchange. Certain affiliated funds may suspend the continuous offering of their shares at any time and thereafter may resume such","page_number":546,"box":{"x":46,"y":577,"width":903,"height":13}},{"id":"4772471b-035d-4d83-82b2-a78f62265295","block_type":"box","text":"offering from time to time. The exchange privilege is available only to U.S. shareholders in states where the exchange legally may","page_number":546,"box":{"x":46,"y":593,"width":893,"height":13}},{"id":"4491d5a9-abbb-428b-98c7-a4e19cc71874","block_type":"box","text":"be made.","page_number":546,"box":{"x":46,"y":608,"width":61,"height":11}},{"id":"6ea5930d-191f-4c37-b000-1dcee5cba266","block_type":"box","text":"An exchange pursuant to the exchange privilege is treated as a sale of the exchanged shares and a purchase of the new shares for","page_number":546,"box":{"x":45,"y":631,"width":891,"height":13}},{"id":"cafb8c74-e0bb-4e80-8482-3a03bae29234","block_type":"box","text":"Federal income tax purposes. In addition, an exchanging sha","page_number":546,"box":{"x":45,"y":646,"width":421,"height":13}},{"id":"b6ad758a-0072-4def-9048-94cb98782468","block_type":"box","text":"reholder of any of the funds may be subject to backup withholding","page_number":546,"box":{"x":466,"y":646,"width":464,"height":13}},{"id":"7a1322bf-1dc2-4fb8-a941-aea39cdd812b","block_type":"box","text":"unless such shareholder certifies under penalty of perjury that the taxpayer identification number on file with any such fund is","page_number":546,"box":{"x":46,"y":662,"width":872,"height":13}},{"id":"6c8d65c5-3488-4257-adfb-872344b4f324","block_type":"box","text":"correct, and that he or she is not otherwise subject to backup withholding. See “Dividends and Taxes — Taxes.”","page_number":546,"box":{"x":45,"y":677,"width":781,"height":13}},{"id":"d4ddd595-080a-413d-a940-4796a53c2d0b","block_type":"box","text":"Additional Shareholder Features (Investor A and Investor C Shares Only)","page_number":546,"box":{"x":45,"y":706,"width":533,"height":13}},{"id":"faae3f52-66d8-487e-a0b9-9a68d3658f97","block_type":"box","text":"Automatic Investment Plan (“AIP”).","page_number":546,"box":{"x":45,"y":731,"width":252,"height":12}},{"id":"84e5a213-fd3c-4e0a-800a-d8f1f1813b5c","block_type":"box","text":"Certain shareholders may arrange for periodic investments in the Fund through automatic","page_number":546,"box":{"x":303,"y":731,"width":624,"height":13}},{"id":"8ee07db2-acf6-4127-920d-6c68de7ae615","block_type":"box","text":"deductions from a checking or savings account by completing the AIP Application which may be obtained from the Fund at","page_number":546,"box":{"x":46,"y":746,"width":858,"height":13}},{"id":"ad27685e-8ccc-45d7-9fd0-960e6c7d6065","block_type":"box","text":"(800) 441-7762, or online at www.blackrock.com. The minimum pre-authorized investment amount is $50 per Fund.","page_number":546,"box":{"x":46,"y":761,"width":818,"height":14}},{"id":"0a687e06-dfff-4920-a155-0c9c9b186190","block_type":"box","text":"Systematic Withdrawal Plan (“SWP”).","page_number":546,"box":{"x":46,"y":784,"width":266,"height":13}},{"id":"2bdcbb85-3f43-41a6-8a50-442219bde470","block_type":"box","text":"The Fund offers a Systematic Withdrawal Plan to shareholders who wish to receive regular","page_number":546,"box":{"x":317,"y":784,"width":631,"height":13}},{"id":"e6f49634-a713-4452-a561-a45592764953","block_type":"box","text":"distributions from their accounts. Upon commencement of the","page_number":546,"box":{"x":46,"y":799,"width":432,"height":13}},{"id":"334bf796-40e9-4cbd-971a-8f6c9ed7a748","block_type":"box","text":"SWP, the account must have a current value of $10,000 or more in","page_number":546,"box":{"x":483,"y":799,"width":465,"height":13}},{"id":"5cf3e4ca-14d8-40ae-8f50-3296ad69e8fe","block_type":"box","text":"the Fund. Shareholders may elect to receive automatic cash payments of $50 or more at any interval. You may choose any day for","page_number":546,"box":{"x":45,"y":815,"width":903,"height":13}},{"id":"5b4df03d-65b8-4d30-93ff-2b0f859e62a0","block_type":"box","text":"the withdrawal. If no day is specified, the withdrawals will be processed on the 25th day of the month or, if such day is not a","page_number":546,"box":{"x":45,"y":830,"width":867,"height":13}},{"id":"346f9e52-cb1a-493a-a70b-ad70db0658c5","block_type":"box","text":"Business Day, on the prior Business Day and are paid promptly thereafter. An investor may utilize the SWP by completing the","page_number":546,"box":{"x":46,"y":846,"width":871,"height":13}},{"id":"e6d320f0-362e-4c82-9bb6-3695b7ed9dc2","block_type":"box","text":"Systematic Withdrawal Plan Application Form which may be obtained by calling the Fund or by visiting our website at","page_number":546,"box":{"x":46,"y":861,"width":826,"height":13}},{"id":"b43f35ee-0411-4d88-8002-f5e8a0453d12","block_type":"box","text":"www.blackrock.com.","page_number":546,"box":{"x":45,"y":877,"width":149,"height":10}},{"id":"d3a61422-6f88-4bca-920d-ff744839ce49","block_type":"box","text":"II-36","page_number":546,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"0ae98f3b-e403-4950-90d2-53294ed944c5","block_type":"box","text":"NM1026U-6004382-546/605","page_number":546,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c4bd04df-e21d-4606-a7c1-f0a49541ad3c","block_type":"box","text":"Shareholders should realize that if withdrawals exceed income di","page_number":547,"box":{"x":46,"y":79,"width":448,"height":10}},{"id":"11e0e560-7b18-4b62-8c67-59a4577a9f81","block_type":"box","text":"vidends their invested principal in the account will be depleted.","page_number":547,"box":{"x":495,"y":79,"width":435,"height":13}},{"id":"8a2dca50-88b0-4a96-97fa-85f169ce2aff","block_type":"box","text":"To participate in the SWP, shareholders must have their dividends automatically reinvested. Shareholders may change or cancel","page_number":547,"box":{"x":45,"y":94,"width":884,"height":13}},{"id":"9dba330b-4664-4d63-97cf-74feee88b5c6","block_type":"box","text":"the SWP at any time, upon written notice to the Fund, or by calling the Fund at (800) 441-7762.","page_number":547,"box":{"x":45,"y":110,"width":670,"height":13}},{"id":"77803cf9-8f20-4e66-ad9b-1fd00a9c8b04","block_type":"box","text":"For this reason, a shareholder may not participate in the Autom","page_number":547,"box":{"x":45,"y":133,"width":443,"height":12}},{"id":"f3609674-e1ae-4ea8-ad4e-e5fa8575a581","block_type":"box","text":"atic Investment Plan (see “Account Services and Privileges —","page_number":547,"box":{"x":489,"y":133,"width":421,"height":12}},{"id":"0fa8a441-a31a-4cae-b6bb-b467eddb6a3b","block_type":"box","text":"Automatic Investment Plan” in the Fund’s Prospectus) and the Systematic Withdrawal Plan at the same time.","page_number":547,"box":{"x":45,"y":148,"width":755,"height":13}},{"id":"1564db6b-a8da-48cd-b22d-c7ae74c048ae","block_type":"box","text":"Dividend Allocation Plan.","page_number":547,"box":{"x":45,"y":171,"width":179,"height":10}},{"id":"f6d1528d-a2fd-4eae-9ee2-ce0851ebf4a3","block_type":"box","text":"The Dividend Allocation Plan allows shareholders to elect to have all their dividends and any other","page_number":547,"box":{"x":229,"y":171,"width":687,"height":13}},{"id":"103dc808-1b90-47bf-99ec-6724c409a6ea","block_type":"box","text":"distributions from the Fund or any Eligible Fund (which includes the Fund and other funds as designated by BRIL from time to","page_number":547,"box":{"x":46,"y":186,"width":881,"height":13}},{"id":"70c8adbf-27df-43a7-a569-bbef4279a623","block_type":"box","text":"time) automatically invested at NAV in one other such Eligible","page_number":547,"box":{"x":45,"y":202,"width":435,"height":13}},{"id":"651bee0e-f3a1-4a09-b79d-cc72e463183a","block_type":"box","text":"Fund designated by the shareholder, provided the account into","page_number":547,"box":{"x":485,"y":202,"width":434,"height":13}},{"id":"dbc1c587-d9ba-4d2e-bb0b-fd6912dda516","block_type":"box","text":"which the dividends and distributions are directed is initially funded with the requisite minimum amount.","page_number":547,"box":{"x":45,"y":217,"width":730,"height":13}},{"id":"1fc34d61-7d09-48c3-80e6-b81192fc64d2","block_type":"box","text":"Conversion of Investor C Shares to Investor A Shares","page_number":547,"box":{"x":46,"y":248,"width":387,"height":12}},{"id":"23f358f3-938b-4be3-8c0f-68c84629affc","block_type":"box","text":"Effective November 23, 2020 (the “Effective Date”), approximately eight years after purchase, Investor C Shares of the Fund will","page_number":547,"box":{"x":45,"y":273,"width":898,"height":13}},{"id":"ec2f7075-1ad0-4528-b11b-5fb3c8e60729","block_type":"box","text":"convert automatically into Investor A Shares of the Fund (the “In","page_number":547,"box":{"x":45,"y":288,"width":453,"height":13}},{"id":"b7be178b-9654-4a7f-81cc-b504684d2b3a","block_type":"box","text":"vestor C 8-Year Conversion”). It is the financial intermediary’s","page_number":547,"box":{"x":498,"y":288,"width":436,"height":13}},{"id":"e46f7fa1-8134-47b1-8c5f-cae35316b090","block_type":"box","text":"responsibility to ensure that the shareholder is credited with the proper holding period. As of the Effective Date, certain financial","page_number":547,"box":{"x":45,"y":304,"width":891,"height":13}},{"id":"6d47c89c-05be-4f04-a5a3-8a23916f8cf6","block_type":"box","text":"intermediaries, including group retirement recordkeeping pla","page_number":547,"box":{"x":45,"y":319,"width":422,"height":13}},{"id":"e39c1c78-8b80-4af9-bc6f-e0912b81c911","block_type":"box","text":"tforms, may not have been tracking such holding periods and","page_number":547,"box":{"x":467,"y":319,"width":426,"height":13}},{"id":"acff9764-e06d-4ab3-ba42-5bb13344bb66","block_type":"box","text":"therefore may not be able to process such conversions. In such instances, Investor C Shares held as of the Effective Date will","page_number":547,"box":{"x":45,"y":335,"width":859,"height":13}},{"id":"5ca2564f-bfed-42ff-a2a9-b9424b1f8fd7","block_type":"box","text":"automatically convert to Investor A Shares approximately eight years after the Effective Date. If, as of November 23, 2028 (eight","page_number":547,"box":{"x":46,"y":350,"width":893,"height":13}},{"id":"71175803-9767-4a82-ab66-b2fd643ca8e0","block_type":"box","text":"years after the Effective Date), a financial intermediary has","page_number":547,"box":{"x":45,"y":366,"width":406,"height":13}},{"id":"f908217e-3e58-40c5-bf0a-32f09fc42f2b","block_type":"box","text":"not implemented systems or procedures to track holding periods","page_number":547,"box":{"x":457,"y":366,"width":445,"height":13}},{"id":"a01b8b94-03a5-4066-8d74-9c51d6e13730","block_type":"box","text":"commencing from the Effective Date, shareholders holding Investor C Shares through such financial intermediary will no longer be","page_number":547,"box":{"x":45,"y":381,"width":908,"height":13}},{"id":"9a1746da-fbb6-48b7-a483-339c19f8c506","block_type":"box","text":"eligible to hold Investor C Shares and any such shares will convert to Investor A Shares as soon as reasonably practicable after","page_number":547,"box":{"x":46,"y":397,"width":874,"height":13}},{"id":"61c9e8a4-1b9f-4ce6-b474-f791915d389b","block_type":"box","text":"such date.","page_number":547,"box":{"x":46,"y":412,"width":68,"height":10}},{"id":"a6a28b05-d881-4756-b912-ed0a5d055260","block_type":"box","text":"In addition, accounts that do not have a financial intermediary associated with them are not eligible to hold Investor C Shares, and","page_number":547,"box":{"x":45,"y":435,"width":907,"height":13}},{"id":"3c8ce229-b2c3-43cf-80e7-dd55a0dd5b81","block_type":"box","text":"any Investor C Shares held in such accounts will be automatically converted into Investor A Shares (the “Investor C Direct","page_number":547,"box":{"x":46,"y":451,"width":848,"height":12}},{"id":"53846f5e-c130-4d58-b5ba-713401a8b7fb","block_type":"box","text":"Accounts Conversion” and together with the Investor C 8-Year Conversion, the “Investor C Conversions”).","page_number":547,"box":{"x":45,"y":466,"width":749,"height":13}},{"id":"8a5405a8-25f1-4fa4-986d-670363976e20","block_type":"box","text":"The Investor C Conversions will occur at least once each month (on the “Investor C Conversion Date”) on the basis of the relative","page_number":547,"box":{"x":45,"y":489,"width":905,"height":12}},{"id":"285b5c4f-afd5-4231-a384-9927a79bdc79","block_type":"box","text":"NAV of the shares of the two applicable classes on the Investor C Conversion Date, without the imposition of any sales load, fee","page_number":547,"box":{"x":45,"y":504,"width":893,"height":13}},{"id":"7af03ce4-08f8-4872-969a-113a394a6128","block_type":"box","text":"or other charge. The Investor C Conversions will not be deemed a purchase or sale of the shares for Federal income tax purposes.","page_number":547,"box":{"x":46,"y":520,"width":896,"height":13}},{"id":"ca3a9af8-290d-4fd5-9392-db8125ab9fe5","block_type":"box","text":"Shares acquired through reinvestment of dividends on Investor C Shares will also convert automatically to Investor A Shares, as set","page_number":547,"box":{"x":46,"y":535,"width":908,"height":13}},{"id":"86f5a07d-b8c5-4ec1-be36-babc56b86d94","block_type":"box","text":"forth in the Fund’s Prospectus. The Investor C Conversion Date for dividend reinvestment shares will be calculated taking into","page_number":547,"box":{"x":45,"y":551,"width":877,"height":13}},{"id":"5f2d0e96-c86a-4b8b-8655-25f5024687c3","block_type":"box","text":"account the length of time the shares underlying the dividend reinvestment shares were outstanding.","page_number":547,"box":{"x":46,"y":566,"width":691,"height":13}},{"id":"1b10611f-0434-4da9-8db1-bed756e49afe","block_type":"box","text":"Institutional Shares","page_number":547,"box":{"x":45,"y":596,"width":141,"height":11}},{"id":"312adbe4-1734-4004-bf41-7cfd4886bfc1","block_type":"box","text":"Purchase of Shares","page_number":547,"box":{"x":45,"y":622,"width":129,"height":10}},{"id":"c62561a1-1a12-42fe-9c3a-4ff425563e27","block_type":"box","text":". Summit Cash Reserves offers Institutional Shares as described in the Fund’s Prospectus.","page_number":547,"box":{"x":176,"y":622,"width":612,"height":12}},{"id":"43a9b7ae-878d-4a59-8a02-d9bb6bc09648","block_type":"box","text":"In addition, the following investors may purchase Institutional S","page_number":547,"box":{"x":45,"y":644,"width":445,"height":13}},{"id":"bc886f9a-a2d8-40b8-9152-fc9f7bb5c436","block_type":"box","text":"hares: employees, officers and directors/trustees of BlackRock,","page_number":547,"box":{"x":491,"y":644,"width":431,"height":13}},{"id":"1c6ec76d-e8a0-46db-926c-2fa0c62f6c4e","block_type":"box","text":"Inc., BlackRock Funds, Bank of America Corporation (“BofA Cor","page_number":547,"box":{"x":45,"y":660,"width":460,"height":13}},{"id":"e690040c-1e4d-45a9-8259-877ae4311c8e","block_type":"box","text":"p.”), Barclays PLC or their respective affiliates and immediate","page_number":547,"box":{"x":506,"y":660,"width":428,"height":13}},{"id":"9762cf80-03c2-4f90-b6c3-d202559263a3","block_type":"box","text":"family members of such persons, if they open an account directly with BlackRock; individuals and “Institutional Investors” with a","page_number":547,"box":{"x":45,"y":675,"width":903,"height":13}},{"id":"fe62e3f4-6f48-4744-9f2c-933774aae11a","block_type":"box","text":"minimum initial investment of $2 million who may purchase shares","page_number":547,"box":{"x":45,"y":691,"width":469,"height":13}},{"id":"63ac1daf-923f-4e99-ba1b-4531dd2abf36","block_type":"box","text":"of the Fund through a financial intermediary that has entered","page_number":547,"box":{"x":519,"y":691,"width":425,"height":13}},{"id":"a0899b54-76b8-4389-a000-9f9d55c602e0","block_type":"box","text":"into an agreement with the Distributor to purchase such shares","page_number":547,"box":{"x":45,"y":706,"width":437,"height":13}},{"id":"1c4edd03-d171-49d9-8113-5afae8b68396","block_type":"box","text":"(“Institutional Investors” include, but are not limited to,","page_number":547,"box":{"x":488,"y":706,"width":388,"height":13}},{"id":"3e4fe11b-3b10-4c76-84bd-12550aee0bd3","block_type":"box","text":"endowments, foundations, family offices, local, city, and state gov","page_number":547,"box":{"x":46,"y":722,"width":457,"height":13}},{"id":"bbe0dbe4-df47-4bad-8e9d-d013a074dd77","block_type":"box","text":"ernmental institutions, corporations, and insurance company","page_number":547,"box":{"x":504,"y":722,"width":422,"height":13}},{"id":"335f986e-e427-4b8d-aa03-e4aa28004289","block_type":"box","text":"separate accounts); employer-sponsored retirement plans (which, for this purpose, do not include SEP IRAs, SIMPLE IRAs or","page_number":547,"box":{"x":46,"y":737,"width":870,"height":13}},{"id":"e437d052-82fc-46c8-a5fb-9ae8b56bbcc2","block_type":"box","text":"SARSEPs), state sponsored 529 college savings plans, collectiv","page_number":547,"box":{"x":46,"y":753,"width":430,"height":13}},{"id":"2693e234-93fb-4902-8ca7-3a58a341dbcf","block_type":"box","text":"e trust funds, investment companies or other pooled investment","page_number":547,"box":{"x":476,"y":753,"width":440,"height":13}},{"id":"9606d533-4f74-4877-b014-e16e39ec2fbf","block_type":"box","text":"vehicles, unaffiliated thrifts and unaffiliated banks and trust companies, each of which may purchase shares of the Fund through a","page_number":547,"box":{"x":45,"y":769,"width":903,"height":12}},{"id":"ddc69b7d-7234-490f-bd81-d877ab8b9232","block_type":"box","text":"financial intermediary that has entered into an agreement with the","page_number":547,"box":{"x":45,"y":784,"width":459,"height":13}},{"id":"922ef384-045a-4cd9-b090-d5962ba14cc6","block_type":"box","text":"Distributor to purchase such shares; clients investing through a","page_number":547,"box":{"x":509,"y":784,"width":436,"height":13}},{"id":"a22a730e-ef9e-4a95-a7f7-d632b84f8976","block_type":"box","text":"self-directed IRA brokerage account program sponsored by a retirement plan record-keeper, provided that such program offers","page_number":547,"box":{"x":46,"y":800,"width":880,"height":12}},{"id":"4d1e94a0-d7bd-484b-9f00-4b6daeca54ec","block_type":"box","text":"only mutual fund options and that the program maintains an a","page_number":547,"box":{"x":46,"y":815,"width":435,"height":13}},{"id":"a5bc70e1-4d7b-433e-b2b3-89b250da4996","block_type":"box","text":"ccount with the Fund on an omnibus basis; clients of financial","page_number":547,"box":{"x":482,"y":815,"width":430,"height":12}},{"id":"86779097-f96c-404a-b18b-92d15cb56bb9","block_type":"box","text":"intermediaries that: (i) charge such clients a fee for advisory, i","page_number":547,"box":{"x":45,"y":831,"width":426,"height":12}},{"id":"c5fe250b-36eb-4012-bead-19da2db7b4f5","block_type":"box","text":"nvestment consulting, or similar services or (ii) have entered into an","page_number":547,"box":{"x":471,"y":831,"width":468,"height":12}},{"id":"0871ccf1-eec1-449b-be11-0418cf6be240","block_type":"box","text":"agreement with the Distributor to offer Institutional Shares thr","page_number":547,"box":{"x":46,"y":846,"width":434,"height":13}},{"id":"debcb7fa-d64b-46dd-a3ef-6081800baa0d","block_type":"box","text":"ough a no-load program or investment platform, in each case, with","page_number":547,"box":{"x":481,"y":846,"width":465,"height":13}},{"id":"ed6ecf82-f6e6-477f-8eba-94df6e2325f2","block_type":"box","text":"no minimum initial investment; clients investing through financi","page_number":547,"box":{"x":45,"y":862,"width":444,"height":12}},{"id":"789aab90-8d66-41f4-afa0-9990cfe537b1","block_type":"box","text":"al intermediaries that have entered into an agreement with the","page_number":547,"box":{"x":490,"y":862,"width":429,"height":12}},{"id":"c798b188-5fde-4d0d-adac-6bd9984e3c26","block_type":"box","text":"Distributor to offer such shares on a platform that charges a transaction based sales commission outside of the Fund, with a","page_number":547,"box":{"x":45,"y":877,"width":859,"height":13}},{"id":"629faeed-e732-44dc-a2c2-c3ab0ff65101","block_type":"box","text":"II-37","page_number":547,"box":{"x":482,"y":917,"width":35,"height":9}},{"id":"9eb3d13f-cde7-46ac-a727-45a8e5b31872","block_type":"box","text":"NM1026U-6004382-547/605","page_number":547,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"bad250ed-12d7-4c2e-b864-6015473c7698","block_type":"box","text":"minimum initial investment of $1,000; tax-qualified accounts for insurance agents that are registered representatives of an","page_number":548,"box":{"x":45,"y":78,"width":846,"height":14}},{"id":"640d4bcc-550d-48fa-85f1-7a2dcd78c0f9","block_type":"box","text":"insurance company’s broker-dealer that has entered into an ag","page_number":548,"box":{"x":45,"y":94,"width":433,"height":13}},{"id":"28e42784-181a-4aca-ba72-0069788b7c3e","block_type":"box","text":"reement with the Distributor to offer Institutional Shares, and the","page_number":548,"box":{"x":478,"y":94,"width":454,"height":13}},{"id":"4054b8e2-7825-4bcb-8e76-c2c6e8e56c8d","block_type":"box","text":"family members of such persons, with a minimum initial investment","page_number":548,"box":{"x":45,"y":110,"width":472,"height":13}},{"id":"33814631-0243-4732-a350-87c6507413d6","block_type":"box","text":"of $1,000; trust department clients of Bank of America, N.A.","page_number":548,"box":{"x":522,"y":109,"width":423,"height":14}},{"id":"bb8c5116-c89b-41ad-a4b5-421451bfa3ed","block_type":"box","text":"and its affiliates for whom they (i) act in a fiduciary capacity (excluding participant directed employee benefit plans), (ii) otherwise","page_number":548,"box":{"x":46,"y":125,"width":903,"height":13}},{"id":"119f9511-1f45-4a47-8afc-e6cb8183bd5e","block_type":"box","text":"have investment discretion, or (iii) act as custodian for at least","page_number":548,"box":{"x":45,"y":141,"width":430,"height":12}},{"id":"78919a79-4456-4e3e-8a5c-9baee6a87122","block_type":"box","text":"$2 million in assets; and holders of certain BofA Corp. sponsored","page_number":548,"box":{"x":480,"y":140,"width":453,"height":14}},{"id":"6ccec62b-6b9c-4e09-8229-a9aa8d87963f","block_type":"box","text":"unit investment trusts (UITs) who reinvest dividends received from such UITs in shares of the Fund.","page_number":548,"box":{"x":46,"y":156,"width":689,"height":13}},{"id":"c5c123bd-d70f-44e9-95e4-fbf6b3b621fd","block_type":"box","text":"The Fund may in its discretion waive or modify any minimum investment amount, may reject any order for any class of shares","page_number":548,"box":{"x":45,"y":179,"width":878,"height":12}},{"id":"1231a171-fdf0-4fc2-b7d9-1ba4475f9966","block_type":"box","text":"and may suspend and resume the sale of shares of the Fund at any time.","page_number":548,"box":{"x":46,"y":194,"width":496,"height":13}},{"id":"dd6cbda5-8428-4464-a0fc-df2d54eb1a2a","block_type":"box","text":"Institutional Shares of the Fund may be purchased by customers of broker-dealers and agents that have established a servicing","page_number":548,"box":{"x":45,"y":216,"width":873,"height":13}},{"id":"98a58162-c9bc-423b-a5ff-2d479142917f","block_type":"box","text":"relationship with the Fund on behalf of their customers. These broker-dealers and agents may impose additional or different","page_number":548,"box":{"x":45,"y":232,"width":861,"height":13}},{"id":"60e54119-a3df-4262-8663-3f5b6b23db43","block_type":"box","text":"conditions on the purchase or redemption of Fund shares by their c","page_number":548,"box":{"x":45,"y":247,"width":466,"height":13}},{"id":"2ef95e29-d7ac-4f20-88e8-c191b61a6f86","block_type":"box","text":"ustomers and may charge their customers transaction, account","page_number":548,"box":{"x":512,"y":247,"width":433,"height":13}},{"id":"2896a7fd-6edb-48b5-afb2-fe3788a54b9b","block_type":"box","text":"or other fees on the purchase and redemption of Fund shares. Each broker-dealer or agent is responsible for transmitting to its","page_number":548,"box":{"x":46,"y":263,"width":874,"height":13}},{"id":"70b28ac5-7057-4587-a2cf-d8735ed23d9a","block_type":"box","text":"customers a schedule of any such fees and information regarding any additional or different conditions regarding purchases and","page_number":548,"box":{"x":45,"y":278,"width":887,"height":13}},{"id":"989fb94d-3a76-4cc7-b811-873eefb29ed0","block_type":"box","text":"redemptions. Shareholders who are customers of such broker-de","page_number":548,"box":{"x":45,"y":294,"width":447,"height":13}},{"id":"811edafe-579b-4524-8d04-0eafc7e321ca","block_type":"box","text":"alers or agents should consult them for information regarding","page_number":548,"box":{"x":492,"y":294,"width":428,"height":13}},{"id":"eeb7d0f7-86f7-4f63-92c7-f31991d37d36","block_type":"box","text":"these fees and conditions.","page_number":548,"box":{"x":45,"y":309,"width":176,"height":10}},{"id":"ca37a459-c32a-40fd-a0b2-e4a5da709ad8","block_type":"box","text":"Except as otherwise specified in the Fund’s Prospectus, payment for Institutional Shares must normally be made in Federal funds","page_number":548,"box":{"x":45,"y":331,"width":892,"height":13}},{"id":"f4fcc0ed-239f-447a-ab93-cf12d0b41e1a","block_type":"box","text":"or other immediately available funds by the time specified by the sha","page_number":548,"box":{"x":46,"y":347,"width":475,"height":13}},{"id":"073d58ed-ad0b-470f-8217-b9e8f9dad24c","block_type":"box","text":"reholder’s financial intermediary, but in no event later than","page_number":548,"box":{"x":521,"y":347,"width":410,"height":13}},{"id":"d2cd569d-47af-4ac5-b7ec-33a2817f0d55","block_type":"box","text":"the close of the federal funds wire (normally 6:45 p.m. (Eastern time)). Payment may also, in the discretion of the Fund, be made","page_number":548,"box":{"x":45,"y":362,"width":892,"height":13}},{"id":"b6ea656e-4036-4733-9225-fbc3c519705e","block_type":"box","text":"in the form of securities that are permissible investments for the Fund. If payment for a purchase order is not received by the","page_number":548,"box":{"x":45,"y":378,"width":861,"height":13}},{"id":"172d4f5a-306b-4e6f-82af-876a97f4994b","block_type":"box","text":"prescribed time, an investor may be liable for any resulting losses or expenses incurred by the Fund.","page_number":548,"box":{"x":45,"y":394,"width":689,"height":12}},{"id":"e88e877b-fca3-40ae-8329-e5cc066638e7","block_type":"box","text":"Financial intermediaries may, in connection with a change in account type or otherwise in accordance with a financial","page_number":548,"box":{"x":45,"y":416,"width":818,"height":13}},{"id":"ef4dec3a-1ce4-4cd4-bfa7-74f6a8a81d6f","block_type":"box","text":"intermediary’s policies and procedures, exchange shares of the Fund from one class of shares to another class of shares of the","page_number":548,"box":{"x":45,"y":431,"width":866,"height":13}},{"id":"8771b6cc-1bc3-4005-8cc8-6470e18d99c9","block_type":"box","text":"Fund, provided that the exchanged shares are not subject to a C","page_number":548,"box":{"x":45,"y":447,"width":443,"height":13}},{"id":"cc2b047e-a469-427c-b149-36c92f449ff6","block_type":"box","text":"DSC and that shareholders meet eligibility requirements of the","page_number":548,"box":{"x":489,"y":447,"width":432,"height":13}},{"id":"839d6ae2-96d1-4034-ba08-f82ac8de5b42","block_type":"box","text":"new share class.","page_number":548,"box":{"x":45,"y":462,"width":110,"height":10}},{"id":"7043cb90-7569-4772-9395-b00a41d0ca79","block_type":"box","text":"DCC&S.","page_number":548,"box":{"x":45,"y":485,"width":64,"height":10}},{"id":"ced3ba95-de75-4891-8fea-11e1f1124199","block_type":"box","text":"Qualified Plans may be able to invest in shares of the Fund through the Defined Contribution Clearance and Settlement","page_number":548,"box":{"x":115,"y":484,"width":828,"height":13}},{"id":"f5815604-f068-43ae-845a-dfdab71a6b69","block_type":"box","text":"System (“DCC&S”) of the National Securities Clearing Corpora","page_number":548,"box":{"x":46,"y":500,"width":448,"height":13}},{"id":"55f0c2bb-f36a-4370-a9e9-bad11c663ff7","block_type":"box","text":"tion. Institutions qualifying to trade on DCC&S include broker/","page_number":548,"box":{"x":494,"y":500,"width":445,"height":13}},{"id":"a5a50b61-5fd9-412b-8840-a96b8bfb765a","block_type":"box","text":"dealers, trust companies and third party administrators. 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Such Authorized","page_number":548,"box":{"x":480,"y":600,"width":437,"height":13}},{"id":"5350bca0-b573-4455-ab60-18edc40d6823","block_type":"box","text":"Persons are authorized to designate other intermediaries to","page_number":548,"box":{"x":45,"y":615,"width":407,"height":13}},{"id":"255af604-c18a-4878-a791-dd32ed0c5da4","block_type":"box","text":"receive purchase and redemption orders on the Fund’s behalf, and the","page_number":548,"box":{"x":457,"y":615,"width":483,"height":13}},{"id":"aade2c13-bb5b-43dd-81aa-d3b5856c2980","block_type":"box","text":"Fund will be deemed to have received a purchase or redemption o","page_number":548,"box":{"x":45,"y":631,"width":456,"height":13}},{"id":"9fea3923-103b-4964-aa08-5e5450ba1620","block_type":"box","text":"rder when an Authorized Person or, if applicable, such","page_number":548,"box":{"x":502,"y":631,"width":378,"height":13}},{"id":"5bde4245-6e53-4cca-8a11-7ccd96304c64","block_type":"box","text":"Authorized Person’s authorized designee, receives the order.","page_number":548,"box":{"x":45,"y":646,"width":414,"height":13}},{"id":"006a7f4a-1edf-46ad-8464-034984701ceb","block_type":"box","text":"Such customer orders will be priced at the Fund’s NAV next","page_number":548,"box":{"x":466,"y":646,"width":418,"height":13}},{"id":"64ac6bd5-088c-48ec-82c3-d183549c421a","block_type":"box","text":"computed after they are received by an Authorized Person or such","page_number":548,"box":{"x":45,"y":662,"width":458,"height":13}},{"id":"44558f1f-0998-4166-b865-c70238b8a898","block_type":"box","text":"Authorized Person’s authorized designee. Financial institutions","page_number":548,"box":{"x":508,"y":662,"width":434,"height":13}},{"id":"7f2f1a28-161d-49e7-be47-d29a54b15baa","block_type":"box","text":"may include retirement plan service providers who aggregat","page_number":548,"box":{"x":45,"y":677,"width":414,"height":13}},{"id":"401da977-68e6-46bf-ad85-4213798faa24","block_type":"box","text":"e purchase and redemption instructions received from numerous","page_number":548,"box":{"x":460,"y":677,"width":445,"height":13}},{"id":"26699933-829f-44fb-a355-a66cbad37671","block_type":"box","text":"retirement plans or plan participants.","page_number":548,"box":{"x":45,"y":693,"width":257,"height":13}},{"id":"3b6682bc-d791-4f71-8e92-b7c9225c70df","block_type":"box","text":"Investor Shares","page_number":548,"box":{"x":45,"y":722,"width":111,"height":10}},{"id":"904f29a0-348b-4e39-8c7e-7be53edb722e","block_type":"box","text":"Purchase of Shares.","page_number":548,"box":{"x":45,"y":746,"width":133,"height":10}},{"id":"4c6e304a-6b4e-4239-886b-29395452752d","block_type":"box","text":"The minimum investment for the initial purchase of shares is $1,000. 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Pu","page_number":548,"box":{"x":46,"y":793,"width":465,"height":13}},{"id":"c8303a7d-2c68-410b-b136-9ff6d8c24bbf","block_type":"box","text":"rchases through the Automatic Investment Plan are subject to a","page_number":548,"box":{"x":511,"y":793,"width":439,"height":13}},{"id":"65fea409-6cce-49bc-96e5-861f7ae2125f","block_type":"box","text":"lower initial purchase minimum. In addition, the minimum in","page_number":548,"box":{"x":45,"y":808,"width":427,"height":13}},{"id":"4ea0fa75-43ac-4736-98b9-d91f182371a1","block_type":"box","text":"itial investment for employees of the Fund, the Fund’s Manager,","page_number":548,"box":{"x":473,"y":808,"width":444,"height":13}},{"id":"99a8068d-192a-4d05-bc32-932464abae7f","block_type":"box","text":"sub-adviser, BRIL or transfer agent or employees of their affiliates is $100, unless payment is made through a payroll deduction","page_number":548,"box":{"x":46,"y":823,"width":884,"height":14}},{"id":"351c5bf2-c37b-4d46-9123-de051339d80d","block_type":"box","text":"program in which case the minimum investment is $25.","page_number":548,"box":{"x":45,"y":839,"width":385,"height":13}},{"id":"2e0be340-df39-4b87-aa10-f14b82fcdea6","block_type":"box","text":"Purchases Through Brokers.","page_number":548,"box":{"x":45,"y":861,"width":197,"height":13}},{"id":"33cad730-e0c0-4e8a-9a31-70c698eb4877","block_type":"box","text":"It is the responsibility of brokers to transmit purchase orders and payment on a timely basis.","page_number":548,"box":{"x":248,"y":861,"width":639,"height":13}},{"id":"80fda846-a5e3-4b1c-a2dd-eb92814abf5c","block_type":"box","text":"Generally, if payment is not received within the period described in t","page_number":548,"box":{"x":46,"y":877,"width":474,"height":13}},{"id":"a365a119-3d42-4009-b05c-e5bb14f99c32","block_type":"box","text":"he Prospectus, the order will be canceled, notice thereof will","page_number":548,"box":{"x":520,"y":877,"width":416,"height":13}},{"id":"6d1bc6e0-dc7d-4526-9ae7-bee5cfd7d8bc","block_type":"box","text":"II-38","page_number":548,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"248b0849-093d-46dd-9ce5-9dfc7839887c","block_type":"box","text":"NM1026U-6004382-548/605","page_number":548,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"463e3157-9a03-48fc-8120-50f667137b63","block_type":"box","text":"be given, and the broker and its customers will be responsible for any loss to the Fund or its shareholders. Orders of less than","page_number":549,"box":{"x":46,"y":79,"width":868,"height":13}},{"id":"a8d04195-562e-45f1-b5a0-5c2b0f3e351c","block_type":"box","text":"$500 may be mailed by a broker to the transfer agent.","page_number":549,"box":{"x":46,"y":94,"width":374,"height":13}},{"id":"0971b580-c31a-450e-baf6-33d98f44b86d","block_type":"box","text":"Other Purchase Information.","page_number":549,"box":{"x":46,"y":119,"width":199,"height":10}},{"id":"aabe42db-341e-4ac2-93f5-b5780c4375a8","block_type":"box","text":"Shares of the Fund are sold on a continuous basis by BRIL as distributor. BRIL maintains its","page_number":549,"box":{"x":251,"y":119,"width":640,"height":13}},{"id":"96278e53-09b8-4b8a-a5dc-45632ad2e364","block_type":"box","text":"principal offices at 50 Hudson Yards, New York, New York 10001. Purchases may be effected on weekdays on which both the","page_number":549,"box":{"x":45,"y":135,"width":887,"height":13}},{"id":"dc2b39b2-65b8-4298-9ad1-9c84c373840b","block_type":"box","text":"NYSE and the Federal Reserve Bank of Philadelphia are open for business (a “Business Day”). Payment for orders which are not","page_number":549,"box":{"x":45,"y":150,"width":893,"height":13}},{"id":"59983626-e266-4759-9bdd-39f4e420c9e9","block_type":"box","text":"received or accepted will be returned after prompt inquiry. The issuance of shares is recorded on the books of the Fund. No","page_number":549,"box":{"x":45,"y":166,"width":856,"height":13}},{"id":"3cbd8a24-0158-453c-824e-7311b0460f9d","block_type":"box","text":"certificates will be issued for shares. Payments for shares of the F","page_number":549,"box":{"x":45,"y":181,"width":449,"height":13}},{"id":"7f0bfb73-3b59-471b-99f0-5c69c3d8331d","block_type":"box","text":"und may, in the discretion of the Fund’s Manager, be made in the","page_number":549,"box":{"x":494,"y":181,"width":455,"height":13}},{"id":"3d086fec-7262-455c-bf10-5c4ddecec04b","block_type":"box","text":"form of securities that are permissible investments for the Fund. 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Exchanges of Investor C Shares of","page_number":549,"box":{"x":45,"y":321,"width":900,"height":13}},{"id":"706c09e7-6140-4272-86fe-250adafdeaa7","block_type":"box","text":"WeLEAF for Investor C Shares of a Non-Money Market Portfolio will be exercised at NAV. However, a CDSC will be charged in","page_number":549,"box":{"x":45,"y":337,"width":904,"height":13}},{"id":"c02c266c-fdc1-40d3-8027-7043633ac220","block_type":"box","text":"connection with the redemption of the Investor C Shares of the Non-Money Market Portfolio received in the exchange.","page_number":549,"box":{"x":45,"y":352,"width":828,"height":13}},{"id":"88c69e0d-619b-4832-91ee-d928266124ff","block_type":"box","text":"A CDSC of up to 1.00% may apply to certain redemptions of Investor A Shares of WeLEAF purchased in an exchange transaction","page_number":549,"box":{"x":45,"y":377,"width":908,"height":13}},{"id":"609cb4ad-07d9-4fac-ad63-411b04ed8dbb","block_type":"box","text":"for Investor A Shares of a portfolio advised by BlackRock or its affiliates where no initial sales charge was paid at the time of","page_number":549,"box":{"x":45,"y":393,"width":868,"height":13}},{"id":"e7a30890-a3ea-4a1f-95b4-f53660678d13","block_type":"box","text":"purchase of such Fund (an “Investor A Load-Waived BlackRo","page_number":549,"box":{"x":45,"y":408,"width":431,"height":13}},{"id":"b6d66e1a-76d4-4121-8623-7bfc60d17005","block_type":"box","text":"ck Fund”) as part of an investment of $1,000,000 (lesser amounts","page_number":549,"box":{"x":477,"y":408,"width":457,"height":13}},{"id":"5202bd1e-b36c-4698-917f-21ed52782802","block_type":"box","text":"may apply depending on the Investor A Load-Waived BlackRock Fund) or more. The Investor A Shares CDSC is only charged","page_number":549,"box":{"x":45,"y":424,"width":878,"height":13}},{"id":"8e01f1ec-b522-4039-b1a3-869e4a80cb09","block_type":"box","text":"upon redemptions of Investor A Shares within 18 months after you originally acquired such Investor A Shares of the Investor A","page_number":549,"box":{"x":46,"y":440,"width":883,"height":12}},{"id":"46f83b18-a3e6-4f02-9113-193232f19bd0","block_type":"box","text":"Load-Waived BlackRock Fund (a shorter holding period may appl","page_number":549,"box":{"x":46,"y":455,"width":460,"height":13}},{"id":"bccba757-3d3c-4e8c-b87d-c69b36622b7f","block_type":"box","text":"y depending on the Investor A Load-Waived BlackRock Fund),","page_number":549,"box":{"x":507,"y":455,"width":437,"height":13}},{"id":"ccc79703-85b4-466e-a109-1487bba9b4ea","block_type":"box","text":"unless you qualify for a waiver. There is no CDSC charged on redemptions if you have owned your Investor A Shares for more","page_number":549,"box":{"x":46,"y":471,"width":880,"height":12}},{"id":"dd158246-ceaf-4902-83a1-7a5c282e43c2","block_type":"box","text":"than 18 months (or for a shorter holding period, as applicable) as measured from your original purchase of Investor A Shares that","page_number":549,"box":{"x":45,"y":486,"width":901,"height":13}},{"id":"44e38e78-9d83-47e3-8c93-00d129694524","block_type":"box","text":"you exchanged into Investor A Shares of WeLEAF. The deferred sales charge on Investor A Shares is not charged in connection","page_number":549,"box":{"x":45,"y":502,"width":882,"height":12}},{"id":"95c0541e-3cb3-4541-b297-3295846ec071","block_type":"box","text":"with: (a) redemptions of Investor A Shares purchased through cert","page_number":549,"box":{"x":45,"y":517,"width":459,"height":13}},{"id":"7c949d40-cfb8-4550-be86-23dc06b5cde5","block_type":"box","text":"ain employer-sponsored retirement plans and rollovers of","page_number":549,"box":{"x":505,"y":517,"width":398,"height":13}},{"id":"5815c0b3-a9fc-4eb4-ad55-84f6fbed8bc4","block_type":"box","text":"current investments in a Fund through such plans; (b) exchanges pursuant to the exchange privilege described in the Fund’s","page_number":549,"box":{"x":45,"y":533,"width":854,"height":12}},{"id":"9d5dceed-c816-4cdf-b94e-4e6967a01d70","block_type":"box","text":"Prospectus; (c) redemptions made in connection with minimum re","page_number":549,"box":{"x":45,"y":548,"width":457,"height":13}},{"id":"fccd8fe6-fe4e-47c7-ba06-81619f3cc418","block_type":"box","text":"quired distributions due to the shareholder reaching age 72 from","page_number":549,"box":{"x":503,"y":548,"width":448,"height":13}},{"id":"75e36b8f-7df5-44c2-abea-ea3452b47a89","block_type":"box","text":"IRA and 403(b)(7) accounts; (d) redemptions made with respect to certain retirement plans sponsored by BlackRock or its","page_number":549,"box":{"x":45,"y":564,"width":848,"height":12}},{"id":"5f99078e-e1af-4219-a63b-31481c6b8369","block_type":"box","text":"affiliates; (e) redemptions (i) within one year of a shareholder’s death or, if later, the receipt of a certified probate settlement","page_number":549,"box":{"x":46,"y":579,"width":856,"height":13}},{"id":"b9ab93bb-65a4-4445-926c-1372e7f106a3","block_type":"box","text":"(including in connection with the distribution of account asset","page_number":549,"box":{"x":46,"y":595,"width":429,"height":12}},{"id":"73b6e3f7-4016-453c-98b3-ecde28f30d22","block_type":"box","text":"s to a beneficiary of the decedent) or (ii) in connection with a","page_number":549,"box":{"x":476,"y":595,"width":422,"height":12}},{"id":"61bb401c-1545-4d4c-a9df-c42a7543652f","block_type":"box","text":"shareholder’s disability (as defined in the Code) subsequent to th","page_number":549,"box":{"x":46,"y":610,"width":447,"height":13}},{"id":"60a8aa6d-387d-4808-9d42-49b19143358d","block_type":"box","text":"e purchase of Investor A Shares; (f) involuntary redemptions of","page_number":549,"box":{"x":494,"y":610,"width":437,"height":13}},{"id":"151ce4e9-418a-4222-82f2-684909b7f4fc","block_type":"box","text":"Investor A Shares in accounts with low balances; (g) certain redemptions made pursuant to the Systematic Withdrawal Plan","page_number":549,"box":{"x":45,"y":626,"width":858,"height":12}},{"id":"9dcaf899-2c45-46fe-8d60-b6854691dc0e","block_type":"box","text":"(described below); (h) redemptions related to the payment of B","page_number":549,"box":{"x":46,"y":641,"width":434,"height":13}},{"id":"d3919692-9268-44db-89d2-8451b92f7444","block_type":"box","text":"NY Mellon Investment Servicing Trust Company custodial IRA","page_number":549,"box":{"x":481,"y":641,"width":442,"height":13}},{"id":"c26ab0b3-ca92-41c0-88cf-f745c3a89945","block_type":"box","text":"fees; and (i) redemptions when a shareholder can demonstrate hardship, in the absolute discretion of a Fund.","page_number":549,"box":{"x":45,"y":657,"width":753,"height":12}},{"id":"d334eb47-4792-4506-8ee9-8a54ad353a77","block_type":"box","text":"A CDSC of 1.00% may apply to certain redemptions of Investor C Shares of WeLEAF. The Investor C Shares CDSC is only","page_number":549,"box":{"x":45,"y":682,"width":862,"height":12}},{"id":"bb85b1a1-56e8-46d4-9154-6cb48623a6e6","block_type":"box","text":"charged upon redemptions of Investor C Shares within one year after you originally acquired the Investor C Shares of the","page_number":549,"box":{"x":45,"y":697,"width":841,"height":13}},{"id":"9d5a379d-bc18-4dc3-92c3-e0f94fe60d60","block_type":"box","text":"Non-Money Market Portfolio, unless you qualify for a waiver. There is no CDSC charged on redemptions if you have owned your","page_number":549,"box":{"x":45,"y":713,"width":908,"height":12}},{"id":"17001142-78d4-436a-a5a4-90c5dd3903d0","block_type":"box","text":"Investor C Shares for more than one year (as measured from your original purchase of Investor C Shares that you exchanged into","page_number":549,"box":{"x":45,"y":728,"width":897,"height":13}},{"id":"1a04bc17-7d4c-4bc2-8e3a-6de3856d5162","block_type":"box","text":"Investor C Shares of WeLEAF). In determining whether an Investor","page_number":549,"box":{"x":45,"y":744,"width":468,"height":12}},{"id":"ca4abcec-c3cc-4167-bb6a-38cf07322967","block_type":"box","text":"C Shares CDSC is applicable to a redemption, the calculation","page_number":549,"box":{"x":518,"y":744,"width":425,"height":12}},{"id":"afac8299-fefa-4c82-9601-05720d199862","block_type":"box","text":"will be determined in the manner that results in the lowest possible rate being charged. The charge will be assessed on an amount","page_number":549,"box":{"x":45,"y":759,"width":896,"height":13}},{"id":"af7515f7-bb28-421d-a867-176a01452b1f","block_type":"box","text":"equal to the lesser of the proceeds of redemption or the cost of","page_number":549,"box":{"x":46,"y":775,"width":433,"height":12}},{"id":"f3091d09-35ed-4162-9652-06f16ec81bf9","block_type":"box","text":"the shares being redeemed. Accordingly, no CDSC will be imposed","page_number":549,"box":{"x":483,"y":775,"width":463,"height":12}},{"id":"0d1eedd8-811a-4734-a9f1-c47c6240c125","block_type":"box","text":"on increases in NAV above the initial purchase price of Investor C Shares. In addition, no CDSC will be assessed on Investor C","page_number":549,"box":{"x":46,"y":790,"width":879,"height":13}},{"id":"df257c75-a8cf-48e4-aebe-158d436c38b4","block_type":"box","text":"Shares acquired through reinvestment of dividends. It will be assumed that the redemption is first of shares held for over one year","page_number":549,"box":{"x":46,"y":806,"width":896,"height":12}},{"id":"141a56b2-5ae1-4801-9f8c-49cfbdcaf34b","block_type":"box","text":"or shares acquired pursuant to reinvestment of dividends and then of shares held longest during the one-year period. A transfer of","page_number":549,"box":{"x":46,"y":821,"width":899,"height":13}},{"id":"64d31d7a-c6f0-4a41-bb78-6cba37cba3fd","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 redemption.","page_number":549,"box":{"x":46,"y":837,"width":824,"height":12}},{"id":"a407cce4-6d52-4871-9ff3-18bd2b7077aa","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Part I of the Fund’s SAI for information about amounts","page_number":549,"box":{"x":46,"y":862,"width":902,"height":12}},{"id":"ce4b1024-b9be-4adc-8c7d-a618dac38a20","block_type":"box","text":"paid to the Distributor in connection with CDSC shares for the periods indicated.","page_number":549,"box":{"x":45,"y":877,"width":565,"height":13}},{"id":"d39bffe7-0368-4ac5-a8fa-4ea1ff2af363","block_type":"box","text":"II-39","page_number":549,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"4fc73e11-56d7-46cc-85a8-cd33e4fa2670","block_type":"box","text":"NM1026U-6004382-549/605","page_number":549,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"17c00566-9b01-46b7-a76d-42f5fb0fd640","block_type":"box","text":"The CDSC on Investor C Shares is not charged in connection with: (1) redemptions of Investor C Shares purchased through","page_number":550,"box":{"x":45,"y":79,"width":859,"height":13}},{"id":"5cf84e92-8484-4f67-a029-0b6a5df89333","block_type":"box","text":"certain employer-sponsored retirement plans and fee-based programs previously approved by certain Funds and rollovers of","page_number":550,"box":{"x":45,"y":94,"width":860,"height":13}},{"id":"875e04ea-856e-4658-ae56-e4c91a717818","block_type":"box","text":"current investments in the Fund through such plans; (2) exchanges pursuant to the exchange privilege described in the Fund’s","page_number":550,"box":{"x":45,"y":110,"width":867,"height":13}},{"id":"de4d4330-2c39-44ea-aa6d-52037882801b","block_type":"box","text":"Prospectus; (3) redemptions made in connection with minimum re","page_number":550,"box":{"x":45,"y":125,"width":459,"height":13}},{"id":"3c8a9226-d3d6-489d-a263-783671608cba","block_type":"box","text":"quired distributions due to the shareholder reaching age 72 from","page_number":550,"box":{"x":505,"y":125,"width":448,"height":13}},{"id":"a54970e1-3fc7-448d-9391-db13ac0da049","block_type":"box","text":"IRA and 403(b)(7) accounts; (4) redemptions made with respect to certain retirement plans sponsored by BlackRock or its","page_number":550,"box":{"x":45,"y":141,"width":848,"height":13}},{"id":"a4523715-a653-49ec-9ef6-f36b898be104","block_type":"box","text":"affiliates; (5) redemptions in connection with a shareholder’s death as long as the waiver request is made within one year of death","page_number":550,"box":{"x":46,"y":156,"width":897,"height":13}},{"id":"155fd9f8-fa5e-47c8-bbcf-a06d742f56d2","block_type":"box","text":"or, if later, reasonably promptly following completion of probate","page_number":550,"box":{"x":46,"y":172,"width":451,"height":13}},{"id":"16f27b26-b9cd-4bc3-8408-caf0a7bf31ae","block_type":"box","text":"(including in connection with the distribution of account assets","page_number":550,"box":{"x":503,"y":172,"width":435,"height":13}},{"id":"ca083637-da58-4d94-8c23-c86e20aa1c26","block_type":"box","text":"to a beneficiary of the decedent) or disability (as defined in the Code) subsequent to the purchase of Investor C Shares;","page_number":550,"box":{"x":45,"y":187,"width":820,"height":13}},{"id":"9c6baedb-4f91-47c8-9bcd-07976bcd3df4","block_type":"box","text":"(6) withdrawals resulting from shareholder disability (as defined in the Code) as long as the disability arose subsequent to the","page_number":550,"box":{"x":46,"y":203,"width":867,"height":13}},{"id":"db5021c3-e3bf-4fb4-a08d-70f842c81014","block_type":"box","text":"purchase of the shares; (7) involuntary redemptions of Investor C Shares in accounts with low balances as described in","page_number":550,"box":{"x":45,"y":218,"width":821,"height":13}},{"id":"459f632d-5197-42eb-8f2e-9be6a7378d00","block_type":"box","text":"“Redemption of Shares” below; (8) redemptions made pursuan","page_number":550,"box":{"x":47,"y":234,"width":438,"height":13}},{"id":"531efa72-5773-4450-9c96-6ab1a9267d76","block_type":"box","text":"t to a systematic withdrawal plan, subject to the limitations set","page_number":550,"box":{"x":485,"y":234,"width":435,"height":13}},{"id":"db3e3452-39fa-4f21-a6ec-d7cbdb77affb","block_type":"box","text":"forth under “Systematic Withdrawal Plan” below; (9) redemptions related to the payment of BNY Mellon Investment Servicing","page_number":550,"box":{"x":45,"y":249,"width":885,"height":13}},{"id":"237b9fcb-bcbd-475b-94f3-8cfad276bf3c","block_type":"box","text":"Trust Company custodial IRA fees; and (10) redemptions when a share","page_number":550,"box":{"x":45,"y":265,"width":495,"height":13}},{"id":"9034fffe-a44d-4785-8b4c-3a6ee7c1c15e","block_type":"box","text":"holder can demonstrate hardship, in the absolute discretion","page_number":550,"box":{"x":541,"y":265,"width":411,"height":13}},{"id":"7c67c62d-148c-4c20-988e-6ec4f7aac3b4","block_type":"box","text":"of the Fund. In addition, no CDSC is charged on Investor C S","page_number":550,"box":{"x":46,"y":280,"width":426,"height":13}},{"id":"3a4a70e0-8e8b-42fc-892a-d9900aa522b7","block_type":"box","text":"hares acquired through the reinvestment of dividends or","page_number":550,"box":{"x":473,"y":280,"width":388,"height":13}},{"id":"e08acce8-bc7b-432c-a120-bcb179e553e4","block_type":"box","text":"distributions.","page_number":550,"box":{"x":46,"y":296,"width":90,"height":10}},{"id":"67bbcd42-b829-47ff-9cbb-e9b7f8371255","block_type":"box","text":"WeLEAF has adopted an automatic conversion feature for Investor C Shares. Effective November 23, 2020, Investor C Shares","page_number":550,"box":{"x":45,"y":319,"width":876,"height":13}},{"id":"683a756c-2ac7-4fbe-949e-1a41aae7b409","block_type":"box","text":"held for approximately eight years will be converted into Investor A Shares, as set forth in the Fund’s Prospectus. In addition,","page_number":550,"box":{"x":45,"y":335,"width":868,"height":12}},{"id":"5d88d08f-a2e3-4a4c-aabd-a3d902f84809","block_type":"box","text":"accounts that do not have a financial intermediary associated with them are not eligible to hold Investor C Shares, and any","page_number":550,"box":{"x":46,"y":350,"width":850,"height":13}},{"id":"dff6c92b-8f78-46f7-8caa-f33a3526a43a","block_type":"box","text":"Investor C Shares held in such accounts will be automatically converted to Investor A Shares.","page_number":550,"box":{"x":45,"y":366,"width":645,"height":12}},{"id":"499d2815-15fa-4bda-ac0d-f21f906570cd","block_type":"box","text":"Certain CDSC waivers and reductions on Investor C Shares may be","page_number":550,"box":{"x":46,"y":389,"width":467,"height":13}},{"id":"e6629d20-db26-4ee1-9388-d3f93b6119be","block_type":"box","text":"available to customers of certain financial intermediaries, as","page_number":550,"box":{"x":518,"y":389,"width":414,"height":12}},{"id":"f53f1f41-d2ac-489f-9203-f9fa3d626b3b","block_type":"box","text":"described under “Intermediary-Defined Sales Charge Waiver Polic","page_number":550,"box":{"x":46,"y":404,"width":458,"height":13}},{"id":"00c5a2d3-295c-4e94-b636-f0d243611b28","block_type":"box","text":"ies” in the Fund’s Prospectus. Please speak to your financial","page_number":550,"box":{"x":505,"y":404,"width":413,"height":13}},{"id":"ef6cf491-0d57-4e55-bb39-68cb431e928d","block_type":"box","text":"intermediary for more information.","page_number":550,"box":{"x":45,"y":420,"width":245,"height":13}},{"id":"c13ae205-dfe2-4677-9783-f8797d6a0926","block_type":"box","text":"Investor A Shares of the Fund that were (1) acquired through the use of the exchange privilege and (2) can be traced back to a","page_number":550,"box":{"x":45,"y":443,"width":874,"height":13}},{"id":"47e50452-5c42-4bce-8c34-60750818a7f4","block_type":"box","text":"purchase of shares in one or more investment portfolios of the Fund for which a sales charge was paid, can be exchanged for","page_number":550,"box":{"x":45,"y":459,"width":865,"height":12}},{"id":"149932bf-df80-4fcf-897e-3eb2f0d73444","block_type":"box","text":"Investor A Shares of the Fund subject to a sales charge.","page_number":550,"box":{"x":45,"y":474,"width":380,"height":13}},{"id":"cd66e71c-333f-4b00-8b42-c5791a1c4068","block_type":"box","text":"A shareholder wishing to make an exchange may do so by sending a written request to the Fund at the following address:","page_number":550,"box":{"x":45,"y":497,"width":843,"height":13}},{"id":"2bd709b8-d3fd-4053-b076-3a262aabb115","block_type":"box","text":"BlackRock, P.O. Box 534429, Pittsburgh, Pennsylvania 15253-4429. Shareholders are automatically provided with telephone","page_number":550,"box":{"x":46,"y":513,"width":873,"height":13}},{"id":"ed187658-7727-4375-8209-91b06daca51a","block_type":"box","text":"exchange privileges when opening an account, unless they indicate on the Application that they do not wish to use this privilege.","page_number":550,"box":{"x":46,"y":528,"width":888,"height":13}},{"id":"a6ea6f3a-16b0-48d5-af48-5e16639d355e","block_type":"box","text":"To add this feature to an existing account that previously did not provide this option, a request must be made in writing or by","page_number":550,"box":{"x":45,"y":544,"width":875,"height":13}},{"id":"e2aa78b7-9177-444e-a20e-e19459ae05a4","block_type":"box","text":"telephone. Once this election has been made, the sharehol","page_number":550,"box":{"x":45,"y":559,"width":400,"height":13}},{"id":"63a30764-dd98-4621-b109-ae4958162358","block_type":"box","text":"der may simply contact the Fund by telephone at (800) 441-7762 to","page_number":550,"box":{"x":446,"y":559,"width":472,"height":13}},{"id":"d487f335-c378-450f-9877-11b377d94e3c","block_type":"box","text":"request the exchange. During periods of substantial economic or market change, telephone exchanges may be difficult to complete","page_number":550,"box":{"x":45,"y":575,"width":904,"height":13}},{"id":"2c0dc96b-3d30-4e08-a6b6-792001c0b98e","block_type":"box","text":"and shareholders may have to submit exchange requests in writing.","page_number":550,"box":{"x":46,"y":590,"width":464,"height":13}},{"id":"18fc1769-86ff-406e-981f-817821fca891","block_type":"box","text":"If the exchanging shareholder does not currently own shares of the investment portfolio whose shares are being acquired, a new","page_number":550,"box":{"x":45,"y":614,"width":887,"height":12}},{"id":"d48d6a8c-3e71-4a15-bd7f-3430ea2c40c7","block_type":"box","text":"account will be established with the same registration, dividend and capital gain options and broker of record as the account from","page_number":550,"box":{"x":46,"y":629,"width":901,"height":13}},{"id":"c712dc7d-c707-4f24-a823-7312f5579ccf","block_type":"box","text":"which shares are exchanged, unless otherwise specified in writing b","page_number":550,"box":{"x":45,"y":645,"width":465,"height":12}},{"id":"7bfad1f9-da8c-47d1-90ca-2b4745e89111","block_type":"box","text":"y the shareholder with all signatures guaranteed by an eligible","page_number":550,"box":{"x":511,"y":645,"width":428,"height":12}},{"id":"480fc6d0-010f-42e4-9098-c21b6f22e9a7","block_type":"box","text":"guarantor institution. In order to participate in the Automatic In","page_number":550,"box":{"x":45,"y":660,"width":447,"height":13}},{"id":"d748da7c-7288-4fc9-8310-a0ea2a6b6c50","block_type":"box","text":"vestment Program or establish a Systematic Withdrawal Plan for","page_number":550,"box":{"x":492,"y":660,"width":448,"height":13}},{"id":"dfeca9e3-1faf-49a5-8eb6-426a70bc6936","block_type":"box","text":"the new account, however, an exchanging shareholder must file a specific written request.","page_number":550,"box":{"x":45,"y":676,"width":621,"height":12}},{"id":"0a217171-6dd7-49e8-845f-eece7a9132b2","block_type":"box","text":"Any share exchange must satisfy the requirements relating to the minimum initial investment requirement, and must be legally","page_number":550,"box":{"x":45,"y":699,"width":875,"height":13}},{"id":"ae3433eb-073c-4b2c-b515-5515743676f5","block_type":"box","text":"available for sale in the state of the investor’s residence. For Fed","page_number":550,"box":{"x":46,"y":714,"width":441,"height":10}},{"id":"ab14114e-1ce0-4737-b660-f96b0307d47f","block_type":"box","text":"eral income tax purposes, a share exchange is a taxable event and,","page_number":550,"box":{"x":488,"y":714,"width":458,"height":13}},{"id":"23d45eb4-b1ac-4dd0-95b7-ccd383feeebc","block_type":"box","text":"accordingly, a capital gain or loss may be realized. Before making an exchange request, shareholders should consult a tax or other","page_number":550,"box":{"x":46,"y":730,"width":900,"height":13}},{"id":"abd0629d-481d-4a17-9499-a55da526a1dc","block_type":"box","text":"financial adviser and should consider the investment objective, policies and restrictions of the investment portfolio into which the","page_number":550,"box":{"x":45,"y":745,"width":895,"height":13}},{"id":"98cd2f0d-c336-4d9d-bdcd-4c55dc52c5de","block_type":"box","text":"shareholder is making an exchange. Brokers may charge a fee for handling exchanges.","page_number":550,"box":{"x":46,"y":761,"width":595,"height":13}},{"id":"607debeb-90ac-4c79-9079-6e37c17fe7eb","block_type":"box","text":"The Fund reserves the right to suspend, modify or terminate t","page_number":550,"box":{"x":45,"y":784,"width":426,"height":13}},{"id":"f0f08466-2021-46be-b433-0ec8cbff522e","block_type":"box","text":"he exchange privilege at any time. Notice will be given to","page_number":550,"box":{"x":472,"y":784,"width":395,"height":13}},{"id":"9dc6a656-4c63-4039-8809-c99a54b94ce0","block_type":"box","text":"shareholders of any material modification or termination ex","page_number":550,"box":{"x":46,"y":800,"width":416,"height":13}},{"id":"45648f90-11da-478b-a956-5e48ee899387","block_type":"box","text":"cept where notice is not required. The Fund reserves the right to reject","page_number":550,"box":{"x":462,"y":800,"width":485,"height":13}},{"id":"96c35001-6b03-403f-9357-d89efdade608","block_type":"box","text":"any telephone exchange request. Telephone exchanges may be subject to limitations as to amount or frequency, and to other","page_number":550,"box":{"x":46,"y":815,"width":863,"height":13}},{"id":"b91e7ff5-6f81-49f8-b80e-001fbe476a82","block_type":"box","text":"restrictions that may be established from time to time to ensure that exchanges do not operate to the disadvantage of any portfolio","page_number":550,"box":{"x":45,"y":831,"width":905,"height":13}},{"id":"7d05f715-9108-4ce2-a600-4e3dc7d15e8a","block_type":"box","text":"or its shareholders. The Fund, the Administrator and BRIL will employ reasonable procedures to confirm that instructions","page_number":550,"box":{"x":46,"y":846,"width":848,"height":13}},{"id":"2a33da36-8bbc-4d94-b2cb-643f5149e8fa","block_type":"box","text":"communicated by telephone are genuine. The Fund, the Trust, the Administrator and BRIL will not be liable for any loss, liability,","page_number":550,"box":{"x":45,"y":862,"width":903,"height":13}},{"id":"ca4c3460-4671-47cd-a71a-8a6e700ae4de","block_type":"box","text":"cost or expense for acting upon telephone instructions reasonably believed to be genuine in accordance with such procedures.","page_number":550,"box":{"x":45,"y":877,"width":869,"height":13}},{"id":"de89fa43-a696-4de0-9c2a-29c2d051b1ab","block_type":"box","text":"II-40","page_number":550,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"91dc110a-0d80-4408-9622-adb41860433a","block_type":"box","text":"NM1026U-6004382-550/605","page_number":550,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"8f4733c6-b605-4270-843d-cd041545e3e7","block_type":"box","text":"By use of the exchange privilege, the investor authorizes the Fund’s transfer agent to act on telephonic or written exchange","page_number":551,"box":{"x":46,"y":79,"width":848,"height":13}},{"id":"82d9462a-491b-4205-ab93-cf11300151bb","block_type":"box","text":"instructions from any person representing him-or herself to be the investor and believed by the Fund’s transfer agent to be genuine.","page_number":551,"box":{"x":45,"y":94,"width":906,"height":13}},{"id":"0cd3c141-ccc4-4e87-84c3-344ee04906bd","block_type":"box","text":"The records of the Fund’s transfer agent pertaining to such instru","page_number":551,"box":{"x":45,"y":110,"width":452,"height":13}},{"id":"70bbc427-9f62-48e0-9d0a-74e8eaceef46","block_type":"box","text":"ctions are binding. The exchange privilege may be modified or","page_number":551,"box":{"x":497,"y":110,"width":432,"height":13}},{"id":"cbad89a9-b2eb-45ff-abaf-a9c6bc1b3e5c","block_type":"box","text":"terminated at any time upon 60 days’ notice to affected sharehol","page_number":551,"box":{"x":45,"y":125,"width":447,"height":13}},{"id":"37d66a5a-07e0-4c2f-9f27-26f619f84fee","block_type":"box","text":"ders. The exchange privilege is only available in states where the","page_number":551,"box":{"x":493,"y":125,"width":445,"height":13}},{"id":"df836ff5-b14d-4660-90e1-afed8d5f3b93","block_type":"box","text":"exchange may legally be made.","page_number":551,"box":{"x":46,"y":141,"width":213,"height":13}},{"id":"adf05b33-448e-462b-9396-4229ac55a375","block_type":"box","text":"The redemption of shares of one fund and the subsequent investment in another fund generally will be treated as two separate","page_number":551,"box":{"x":45,"y":162,"width":874,"height":13}},{"id":"efb48b58-1de4-45fa-81ef-691701aa8ddc","block_type":"box","text":"transactions. Therefore, a front-end sales charge will be impo","page_number":551,"box":{"x":45,"y":178,"width":425,"height":13}},{"id":"82a18233-57a1-42c7-bc39-222954c0bcea","block_type":"box","text":"sed (unless an exemption applies) on the purchase of Investor A or","page_number":551,"box":{"x":471,"y":178,"width":460,"height":13}},{"id":"04a38ee0-b6f5-4960-854d-053ba6a70d28","block_type":"box","text":"Investor A1 Shares of an Investor A Load BlackRock Fund with the proceeds of a redemption of Investor Shares of WeLEAF. In","page_number":551,"box":{"x":45,"y":193,"width":889,"height":13}},{"id":"cf045b71-080a-42de-b122-69cbb015813e","block_type":"box","text":"addition, when Investor Shares of WeLEAF are redeemed and the proceeds are used to purchase Investor C Shares of a","page_number":551,"box":{"x":46,"y":209,"width":822,"height":13}},{"id":"be8e36bc-0c7e-4f44-bf51-bf24d9e86290","block_type":"box","text":"Non-Money Market Portfolio, a CDSC will be imposed (unless an exemption applies) when the Investor C Shares of the","page_number":551,"box":{"x":45,"y":224,"width":836,"height":13}},{"id":"f6bc5078-b6b5-439a-b119-6a14a1ae404b","block_type":"box","text":"Non-Money Market Portfolio are redeemed.","page_number":551,"box":{"x":45,"y":240,"width":310,"height":13}},{"id":"9772a2c7-2b12-4be7-a99b-2203cb95440b","block_type":"box","text":"Automatic Investment Plan (“AIP”).","page_number":551,"box":{"x":45,"y":261,"width":252,"height":13}},{"id":"d43bdc87-9f50-417d-b2a8-612a0aae708f","block_type":"box","text":"Certain shareholders may arrange for periodic investments in the Fund through automatic","page_number":551,"box":{"x":303,"y":261,"width":624,"height":13}},{"id":"c8b3f7d3-5f91-4172-b1cf-eaabba0918a2","block_type":"box","text":"deductions from a checking or savings account by completing the AIP Application which may be obtained from the Fund at","page_number":551,"box":{"x":46,"y":277,"width":858,"height":13}},{"id":"f073705c-63e0-4f18-8019-34b187ee79da","block_type":"box","text":"(800) 441-7762, or online at www.blackrock.com. The minimum pre-authorized investment amount is $50 per Fund.","page_number":551,"box":{"x":46,"y":292,"width":818,"height":13}},{"id":"8da89e4c-28c8-4adc-9441-1f0a0bca5a1e","block_type":"box","text":"Systematic Withdrawal Plan (“SWP”).","page_number":551,"box":{"x":46,"y":314,"width":266,"height":13}},{"id":"75505159-36c7-4707-b43f-4d57046eca34","block_type":"box","text":"WeLEAF offers a Systematic Withdrawal Plan to shareholders who wish to receive regular","page_number":551,"box":{"x":317,"y":314,"width":627,"height":13}},{"id":"288c7471-000d-490d-abd0-f20b629e01e5","block_type":"box","text":"distributions from their accounts. Upon commencement of the","page_number":551,"box":{"x":46,"y":329,"width":432,"height":13}},{"id":"af9dc8eb-b43d-4197-bc41-7b37864d96a3","block_type":"box","text":"SWP, the account must have a current value of $10,000 or more in","page_number":551,"box":{"x":483,"y":329,"width":465,"height":13}},{"id":"99e35ad3-4082-45e6-b729-47438d25dfc3","block_type":"box","text":"the Fund. Shareholders may elect to receive automatic cash payments of $50 or more at any interval. You may choose any day for","page_number":551,"box":{"x":45,"y":345,"width":903,"height":13}},{"id":"b058ca0d-f3b4-4307-85dd-ddd8bcb3a0ce","block_type":"box","text":"the withdrawal. If no day is specified, the withdrawals will be processed on the 25th day of the month or, if such day is not a","page_number":551,"box":{"x":45,"y":360,"width":867,"height":13}},{"id":"3b564c2a-65d4-4a65-bc93-3f0ced2ae9e5","block_type":"box","text":"Business Day, on the prior Business Day and are paid promptly thereafter. An investor may utilize the SWP by completing the","page_number":551,"box":{"x":46,"y":376,"width":871,"height":13}},{"id":"15667a57-1438-41d9-abb8-57d9e8a27cbe","block_type":"box","text":"Systematic Withdrawal Plan Application Form which may be obtained by calling the Fund or by visiting our website at","page_number":551,"box":{"x":46,"y":391,"width":826,"height":13}},{"id":"c9350e33-0743-4638-9e72-8c1342eab4ab","block_type":"box","text":"www.blackrock.com.","page_number":551,"box":{"x":45,"y":407,"width":149,"height":10}},{"id":"baae6835-cf0d-4cdd-9c97-ab1e356e99ca","block_type":"box","text":"Shareholders should realize that if withdrawals exceed income di","page_number":551,"box":{"x":46,"y":428,"width":448,"height":10}},{"id":"2c6b3af3-9bf8-4cb6-83ec-e9398da91d13","block_type":"box","text":"vidends their invested principal in the account will be depleted.","page_number":551,"box":{"x":495,"y":428,"width":435,"height":13}},{"id":"7153eb45-3154-4161-a762-0cb02c4d4874","block_type":"box","text":"To participate in the SWP, shareholders must have their dividends automatically reinvested. 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If, as of November 23, 2028 (eight years after the E","page_number":551,"box":{"x":45,"y":679,"width":464,"height":13}},{"id":"3dca955f-f084-46d2-a1f7-ab89ca1f1dc9","block_type":"box","text":"ffective Date), a financial intermediary has not implemented","page_number":551,"box":{"x":510,"y":679,"width":416,"height":13}},{"id":"e72d9a92-d9a0-4162-90e7-a3d13d4fbf4a","block_type":"box","text":"systems or procedures to track holding periods commencing fro","page_number":551,"box":{"x":46,"y":694,"width":441,"height":13}},{"id":"51384cf0-111d-498d-9742-96d0fdbcfa23","block_type":"box","text":"m the Effective Date, shareholders holding Investor C Shares","page_number":551,"box":{"x":487,"y":694,"width":420,"height":13}},{"id":"926ebecc-6a6e-4a16-8fb8-7e926c9209b5","block_type":"box","text":"through such financial intermediary will no longer be eligible to hold Investor C Shares and any such shares will convert to","page_number":551,"box":{"x":45,"y":710,"width":852,"height":13}},{"id":"1026b4da-02ea-46ca-aeaf-e75c5d5f326a","block_type":"box","text":"Investor A Shares as soon as reasonably practicable after such date.","page_number":551,"box":{"x":45,"y":725,"width":466,"height":13}},{"id":"201647e1-6934-45dd-9816-e6772b373814","block_type":"box","text":"In addition, accounts that do not have a financial intermediary associated with them are not eligible to hold Investor C Shares, and","page_number":551,"box":{"x":45,"y":747,"width":907,"height":13}},{"id":"8c2ec352-c705-4a80-bcb8-6af73b82e59b","block_type":"box","text":"any Investor C Shares held in such accounts will be automatically converted into Investor A Shares (the “Investor C Direct","page_number":551,"box":{"x":46,"y":762,"width":848,"height":13}},{"id":"64a09dff-d1fe-480d-8a76-852cfdaa751d","block_type":"box","text":"Accounts Conversion” and together with the Investor C 8-Year Conversion, the “Investor C Conversions”).","page_number":551,"box":{"x":45,"y":778,"width":749,"height":13}},{"id":"a60bbe97-b255-4527-9cc8-52203c0e374d","block_type":"box","text":"The Investor C Conversions will occur at least once each month (on the “Investor C Conversion Date”) on the basis of the relative","page_number":551,"box":{"x":45,"y":800,"width":905,"height":12}},{"id":"7d497f11-9504-4552-8186-0772666ffd3d","block_type":"box","text":"NAV of the shares of the two applicable classes on the Investor C Conversion Date, without the imposition of any sales load, fee","page_number":551,"box":{"x":45,"y":815,"width":893,"height":13}},{"id":"5d6d88e0-66ae-420b-ac38-7db8fc5fadd0","block_type":"box","text":"or other charge. The Investor C Conversions will not be deemed a purchase or sale of the shares for U.S. federal income tax","page_number":551,"box":{"x":46,"y":831,"width":856,"height":12}},{"id":"3a768cf7-9d11-45c6-9dc8-8dac1e50644d","block_type":"box","text":"purposes. Shares acquired through reinvestment of dividends on Investor C Shares will also convert automatically to Investor A","page_number":551,"box":{"x":45,"y":846,"width":884,"height":13}},{"id":"483a2342-290f-475c-b450-843ceecce271","block_type":"box","text":"Shares, as set forth in WeLEAF’s Prospectus. The Investor C Conversion Date for dividend reinvestment shares will be calculated","page_number":551,"box":{"x":46,"y":862,"width":894,"height":12}},{"id":"fff7802b-922c-41b8-83f6-e8f05d4d4f7a","block_type":"box","text":"taking into account the length of time the shares underlying the dividend reinvestment shares were outstanding.","page_number":551,"box":{"x":45,"y":877,"width":772,"height":13}},{"id":"154ab234-b6c2-4a95-af98-560bca3cb70c","block_type":"box","text":"II-41","page_number":551,"box":{"x":482,"y":917,"width":33,"height":9}},{"id":"b7ecb56a-314f-40e4-ae68-e4ffaff33bb1","block_type":"box","text":"NM1026U-6004382-551/605","page_number":551,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ef649310-c71e-457b-a1b3-981c98e58afb","block_type":"box","text":"Institutional Shares","page_number":552,"box":{"x":45,"y":79,"width":141,"height":10}},{"id":"3c98617b-dbce-4358-ba28-695c8747893d","block_type":"box","text":"Purchase of Shares.","page_number":552,"box":{"x":45,"y":105,"width":133,"height":10}},{"id":"e9cc567e-c363-43ff-9a2e-166394444778","block_type":"box","text":"WeLEAF offers Institutional Shares as described in the Fund’s Prospectus.","page_number":552,"box":{"x":183,"y":105,"width":512,"height":13}},{"id":"d86cc957-ab4b-464a-8775-ef09a881527a","block_type":"box","text":"The following investors may purchase Institutional Shares of WeLEAF, provided that the beneficial owners of such shares are","page_number":552,"box":{"x":45,"y":129,"width":870,"height":13}},{"id":"3fe9ea06-ba66-4a94-a731-d6fa5e42e0c5","block_type":"box","text":"natural persons: employees, officers and directors/trustees of","page_number":552,"box":{"x":45,"y":145,"width":419,"height":13}},{"id":"f050b31c-c382-4d7f-8590-7dab586a215e","block_type":"box","text":"BlackRock, Inc., BlackRock Funds, BofA Corp., Barclays PLC or","page_number":552,"box":{"x":469,"y":145,"width":451,"height":13}},{"id":"ea36900d-3381-4314-932a-88d63820164a","block_type":"box","text":"their respective affiliates and immediate family members of such persons, if they open an account directly with BlackRock;","page_number":552,"box":{"x":45,"y":160,"width":849,"height":13}},{"id":"ad5613af-5f23-4536-957f-fe0b22a71a3f","block_type":"box","text":"individuals with a minimum initial investment of $2 million who may purchase shares of the Fund through a financial","page_number":552,"box":{"x":45,"y":175,"width":819,"height":14}},{"id":"520b2559-c64b-41de-aa20-e7a2d98631a7","block_type":"box","text":"intermediary that has entered into an agreement with the Distri","page_number":552,"box":{"x":45,"y":191,"width":439,"height":13}},{"id":"7a0333b7-2c9f-46c0-a54f-d07187ef1424","block_type":"box","text":"butor to purchase such shares; 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and holders of certain BofA Corp. sponsored","page_number":552,"box":{"x":46,"y":408,"width":453,"height":13}},{"id":"21ced41f-2f5e-4a7a-ab7e-63a5bddc4081","block_type":"box","text":"unit investment trusts (UITs) who reinvest dividends received","page_number":552,"box":{"x":504,"y":408,"width":423,"height":13}},{"id":"baf5af6e-2020-4b59-a67f-f21d47f13e8a","block_type":"box","text":"from such UITs in shares of the Fund.","page_number":552,"box":{"x":45,"y":424,"width":262,"height":10}},{"id":"84a18521-55ad-4252-ac9a-8bbda2e13796","block_type":"box","text":"The Fund may in its discretion waive or modify any minimum investment amount, may reject any order for any class of shares","page_number":552,"box":{"x":45,"y":448,"width":878,"height":12}},{"id":"63deff3d-95e6-46ac-b9ab-e44c00e1b8e0","block_type":"box","text":"and may suspend and resume the sale of shares of the Fund at any time.","page_number":552,"box":{"x":46,"y":463,"width":496,"height":13}},{"id":"ab6eb641-9038-41f8-afab-12d521725549","block_type":"box","text":"Institutional Shares of the Fund may be purchased by customers of broker-dealers and agents that have established a servicing","page_number":552,"box":{"x":45,"y":487,"width":873,"height":13}},{"id":"2c86659a-9cea-4c6b-8f2c-112b00a367d2","block_type":"box","text":"relationship with the Fund on behalf of their customers. 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In order to use this right,","page_number":554,"box":{"x":495,"y":282,"width":436,"height":13}},{"id":"17261682-0d58-4208-96ec-46b2679aa1a7","block_type":"box","text":"the investor must alert BlackRock to the existence of any previously purchased shares. 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The Distributor has agreed to use","page_number":554,"box":{"x":460,"y":440,"width":431,"height":13}},{"id":"321bb42f-82d0-4466-8282-e4848d58ede8","block_type":"box","text":"appropriate efforts to effect sales of the shares, but it is not obligated to sell any particular amount of shares. The Distributor’s","page_number":554,"box":{"x":46,"y":456,"width":875,"height":12}},{"id":"de69a33f-cb87-4363-a6bc-0b845fffce76","block_type":"box","text":"principal business address is 50 Hudson Yards, New York, NY 10001. The Distributor is an affiliate of BlackRock.","page_number":554,"box":{"x":45,"y":471,"width":803,"height":13}},{"id":"0f53dd2c-0793-4cf1-b58b-bf32157e1f4e","block_type":"box","text":"Each Fund (with the exception of Circle Reserve, BlackRock Gov","page_number":554,"box":{"x":45,"y":493,"width":454,"height":13}},{"id":"bdf40f99-35e2-41e0-a773-3db7d70d447b","block_type":"box","text":"ernment Money Market Portfolio and BlackRock Government","page_number":554,"box":{"x":499,"y":493,"width":436,"height":13}},{"id":"4a70af98-5e69-425e-b3df-3cace192ad1b","block_type":"box","text":"Money Market V.I. 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The service fee is not compensation for the admin","page_number":554,"box":{"x":45,"y":570,"width":457,"height":13}},{"id":"ac2bd461-b5b6-4783-8aa3-bbc59cd5e044","block_type":"box","text":"istrative and operational services rendered to shareholders by","page_number":554,"box":{"x":503,"y":570,"width":424,"height":13}},{"id":"775898b2-6173-4151-8a62-b4203b82abec","block_type":"box","text":"affiliates of the Manager that are covered by any other agreement between each Fund and the Manager. 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In their","page_number":554,"box":{"x":436,"y":669,"width":437,"height":13}},{"id":"6e3e1fcf-7389-4a27-a621-05e450e6bb35","block_type":"box","text":"consideration of a Distribution Plan, the Trustees must consider","page_number":554,"box":{"x":45,"y":685,"width":443,"height":12}},{"id":"628313d0-2df8-4d9a-8bbb-5e6d50381aa9","block_type":"box","text":"all factors they deem relevant, including information as to the","page_number":554,"box":{"x":493,"y":685,"width":427,"height":13}},{"id":"b377df81-0fc8-4686-bbb8-3b7edacc23bc","block_type":"box","text":"benefits of the Distribution Plan to the Fund and the related class of shareholders. In approving a Distribution Plan in accordance","page_number":554,"box":{"x":46,"y":700,"width":896,"height":13}},{"id":"561bf6f7-5d1e-413e-8022-0acbb5452f75","block_type":"box","text":"with Rule 12b-1, the non-interested Trustees concluded that there is reasonable likelihood that the Distribution Plan will benefit","page_number":554,"box":{"x":45,"y":716,"width":889,"height":12}},{"id":"0dcdfe49-3f0b-4821-8d3c-b4d58cea7339","block_type":"box","text":"the Fund and its related class of shareholders.","page_number":554,"box":{"x":45,"y":731,"width":315,"height":10}},{"id":"da3a9f2c-c658-4f98-b113-735bde5877a2","block_type":"box","text":"Each Distribution Plan provides that, so long as the Distributio","page_number":554,"box":{"x":45,"y":753,"width":437,"height":13}},{"id":"1bb16d9b-eb4c-4c27-a93f-f3f71a25e6d4","block_type":"box","text":"n Plan remains in effect, the non-interested Trustees then in office","page_number":554,"box":{"x":483,"y":753,"width":453,"height":12}},{"id":"118cacb9-65ab-4c05-afe8-cd90b1b61d73","block_type":"box","text":"will select and nominate other non-interested Trustees. Each Distri","page_number":554,"box":{"x":45,"y":768,"width":462,"height":10}},{"id":"0dd5b384-1deb-4d19-b1db-727925ed2d2f","block_type":"box","text":"bution Plan can be terminated at any time, without penalty, by","page_number":554,"box":{"x":508,"y":768,"width":435,"height":13}},{"id":"3a8306b5-e1cf-4cc4-a64e-a0c382ef45a4","block_type":"box","text":"the vote of a majority of the non-interested Trustees or by the vot","page_number":554,"box":{"x":45,"y":784,"width":454,"height":13}},{"id":"50ac443a-b53d-4b5d-b204-b4e2506d4d98","block_type":"box","text":"e of the holders of a majority of the outstanding related class of","page_number":554,"box":{"x":500,"y":784,"width":440,"height":13}},{"id":"4f47a4e6-837a-4769-ab50-f8ae7dd0ebe1","block_type":"box","text":"voting securities of a Fund. A Distribution Plan cannot be ame","page_number":554,"box":{"x":45,"y":799,"width":433,"height":13}},{"id":"db1e9ed8-2b7c-4dc2-984c-417b67b3afa4","block_type":"box","text":"nded to increase materially the amount to be spent by the Fund","page_number":554,"box":{"x":479,"y":799,"width":438,"height":13}},{"id":"fbafa2cf-cb97-4931-a745-51eb97803f0f","block_type":"box","text":"without the approval of the related class of shareholders. All mat","page_number":554,"box":{"x":45,"y":815,"width":451,"height":13}},{"id":"0e56b479-9cc9-4c44-8cce-7dd2a0f63b2b","block_type":"box","text":"erial amendments are required to be approved by the vote of","page_number":554,"box":{"x":497,"y":815,"width":420,"height":13}},{"id":"71f6ecc7-420f-4b7b-b109-70b3097d7516","block_type":"box","text":"Trustees, including a majority of the non-interested Trustees wh","page_number":554,"box":{"x":45,"y":830,"width":444,"height":13}},{"id":"e3f652be-2698-4e53-b59b-c2457733eddc","block_type":"box","text":"o have no direct or indirect financial interest in the Distribution","page_number":554,"box":{"x":490,"y":830,"width":440,"height":11}},{"id":"81adec19-93f7-4b1a-8e81-900cde645901","block_type":"box","text":"Plan, cast in person at a meeting called for that purpose. Rule 12b-1 further requires that each Fund preserve copies of each","page_number":554,"box":{"x":45,"y":846,"width":856,"height":13}},{"id":"17b3359b-647d-4616-89a1-556b4a05474e","block_type":"box","text":"Distribution Plan and any report made pursuant to such plan for a period of not less than six years from the date of the","page_number":554,"box":{"x":45,"y":861,"width":829,"height":13}},{"id":"aeeaa97b-671e-488a-a3a3-419b7cdc4b0d","block_type":"box","text":"Distribution Plan or such report, the first two years of which should be stored in an easily accessible place.","page_number":554,"box":{"x":45,"y":877,"width":737,"height":13}},{"id":"91e14ee4-9b37-4bfa-8c19-4f5616641805","block_type":"box","text":"II-44","page_number":554,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"fbf5e23e-8006-4ec5-a66d-05f25f230af4","block_type":"box","text":"NM1026U-6004382-554/605","page_number":554,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f9a41768-705b-40b8-b8a6-c419709113bf","block_type":"box","text":"Among other things, each Distribution Plan provides that the Trustees will review quarterly reports of the shareholder servicing","page_number":555,"box":{"x":45,"y":79,"width":885,"height":13}},{"id":"37926980-09c0-4e9c-a720-22c2c96b486e","block_type":"box","text":"and/or distribution expenditures paid to the Distributor. Information with respect to the distribution-related revenues and","page_number":555,"box":{"x":46,"y":94,"width":844,"height":13}},{"id":"b0242b46-1a29-4483-83fe-c1477e8666c9","block_type":"box","text":"expenses is presented to the Trustees for their consideration on a quarterly basis. Distribution-related expenses consist of financial","page_number":555,"box":{"x":46,"y":110,"width":899,"height":13}},{"id":"ade9567a-5870-4f46-89c6-bded10299f44","block_type":"box","text":"adviser compensation, branch office and regional operation center","page_number":555,"box":{"x":46,"y":125,"width":458,"height":13}},{"id":"c79ca60d-28ea-4a1f-a2a9-eae459734129","block_type":"box","text":"selling and transaction processing expenses, advertising, sales","page_number":555,"box":{"x":510,"y":125,"width":422,"height":13}},{"id":"43dc836d-643e-4045-9ab6-8f2162a8aff1","block_type":"box","text":"promotion and marketing expenses and interest expense. 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The maximum sales charge rule in the Conduct Rules of the Financial","page_number":555,"box":{"x":445,"y":233,"width":492,"height":13}},{"id":"869971e9-adde-4035-9a1d-fd0d53882817","block_type":"box","text":"Industry Regulatory Authority (“FINRA”) imposes a limitation on certain asset-based sales charges. 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Sales-based payments primarily create","page_number":555,"box":{"x":461,"y":877,"width":469,"height":13}},{"id":"ade45c0f-85fe-4719-bbb7-e16c159e23c8","block_type":"box","text":"II-45","page_number":555,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"4c7e5a49-387c-46e5-ae2a-4bd40acc28c8","block_type":"box","text":"NM1026U-6004382-555/605","page_number":555,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4294ad3d-c59a-4e44-8508-6345cf7634d6","block_type":"box","text":"incentives to make new sales of shares of the Fund, and asset-based","page_number":556,"box":{"x":45,"y":79,"width":467,"height":12}},{"id":"f1fd3e15-dab3-4c02-9368-fcce9c017ac8","block_type":"box","text":"payments primarily create incentives to retain previously sold","page_number":556,"box":{"x":516,"y":79,"width":425,"height":13}},{"id":"45fd0423-06c8-4e9f-9e8d-503e9cd480e0","block_type":"box","text":"shares of the Fund. 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These payments may take the","page_number":556,"box":{"x":490,"y":213,"width":452,"height":13}},{"id":"cf0ebb03-4dd9-4b0d-a10c-83a8f7a6d91c","block_type":"box","text":"form of, among other things, “due diligence” payments for a S","page_number":556,"box":{"x":45,"y":229,"width":434,"height":12}},{"id":"f15403b9-24d9-4637-8ba6-60f82a6916bb","block_type":"box","text":"ervice Organization’s examination of a Fund; payments for","page_number":556,"box":{"x":480,"y":229,"width":410,"height":12}},{"id":"feb4750c-9e03-4ef8-a417-9ef40b616cd6","block_type":"box","text":"providing extra employee training and information relating to a Fund; fees for access (in some cases on a preferential basis) to the","page_number":556,"box":{"x":45,"y":244,"width":898,"height":13}},{"id":"2cc0ce68-b630-4878-ae79-c6903d731f17","block_type":"box","text":"Service Organization’s registered representatives, salespersons or other personnel, including at sales meetings and conferences;","page_number":556,"box":{"x":46,"y":260,"width":871,"height":12}},{"id":"e3a5abf0-9e72-489c-83e4-095e3d87e485","block_type":"box","text":"“shelf space” payments for placing the Fund on the Service Organiz","page_number":556,"box":{"x":47,"y":275,"width":468,"height":13}},{"id":"e3a45668-4f34-46ba-ab21-ba70941ca5d4","block_type":"box","text":"ation’s platform(s); “listing” fees for the placing of the Fund","page_number":556,"box":{"x":516,"y":275,"width":417,"height":13}},{"id":"05f3d180-f87d-4bc3-8873-d346c126d8a6","block_type":"box","text":"on a dealer’s list (which may be a preferred or recommended list) of mutual funds available for purchase by its customers or in","page_number":556,"box":{"x":46,"y":291,"width":876,"height":12}},{"id":"67561b55-d6dd-4da8-8424-2caea9b1c8f8","block_type":"box","text":"certain sales programs from time to time; fees for providing a","page_number":556,"box":{"x":45,"y":306,"width":425,"height":13}},{"id":"65303b09-98f1-4876-8b0e-34fa57ddc616","block_type":"box","text":"ssistance in promoting the sale of the Fund’s shares (which may","page_number":556,"box":{"x":471,"y":306,"width":440,"height":13}},{"id":"84694e64-18fa-4878-ba52-c18550241ef1","block_type":"box","text":"include promotions in communications with the Service Organiza","page_number":556,"box":{"x":45,"y":322,"width":456,"height":12}},{"id":"4e3f1363-6135-4b4e-9aaa-c69a9882282b","block_type":"box","text":"tion’s customers, registered representatives, salespersons and/or","page_number":556,"box":{"x":501,"y":322,"width":439,"height":12}},{"id":"cb532686-15b4-42d9-bf2b-d615eddad580","block_type":"box","text":"other personnel); payments for the sale of shares and/or the mai","page_number":556,"box":{"x":46,"y":337,"width":441,"height":13}},{"id":"4d88a5b6-237e-49bd-b058-a30bdc05fde9","block_type":"box","text":"ntenance of share balances; transaction fees (also referred to as","page_number":556,"box":{"x":488,"y":337,"width":434,"height":13}},{"id":"80737c4a-29a7-4179-8424-efc2ce62b754","block_type":"box","text":"“ticket charges”); and payments for infrastructure suppor","page_number":556,"box":{"x":47,"y":353,"width":398,"height":12}},{"id":"335ce49c-4ddc-4230-bb46-df54475eb31a","block_type":"box","text":"t. These payments normally will not exceed the sum of (a) 0.25% of","page_number":556,"box":{"x":446,"y":353,"width":473,"height":12}},{"id":"e07325a9-3431-4fb8-9921-44d170696e11","block_type":"box","text":"such year’s Fund sales by that Service Organization, and (b) 0.21% of the assets attributable to that Service Organization invested","page_number":556,"box":{"x":46,"y":368,"width":900,"height":13}},{"id":"96ce8726-8552-42d5-b055-7283309218f7","block_type":"box","text":"in a Fund.","page_number":556,"box":{"x":45,"y":384,"width":70,"height":10}},{"id":"bc2c8a56-bcb2-4384-b7dd-e36d994bd309","block_type":"box","text":"B. Shareholder Services","page_number":556,"box":{"x":79,"y":415,"width":168,"height":10}},{"id":"7a751ba3-71a2-4ed5-b02a-7cfda637d636","block_type":"box","text":"Many Fund shares are owned or held by Service Organizations for the benefit of their customers. In these situations, a Fund may","page_number":556,"box":{"x":45,"y":438,"width":894,"height":13}},{"id":"f0cb8803-79ad-4b8e-9925-6263f03d30a1","block_type":"box","text":"not maintain accounts in the name of the customers, and Service Organizations may perform some of the functions for these","page_number":556,"box":{"x":45,"y":453,"width":863,"height":13}},{"id":"104a0e03-cfb3-4617-a13a-8082143ddfea","block_type":"box","text":"customers’ accounts that the transfer agent would have performe","page_number":556,"box":{"x":45,"y":469,"width":451,"height":13}},{"id":"32aea683-ba7e-4e6e-a88a-e6afe8efeee0","block_type":"box","text":"d if the accounts had been in the customers’ names on the Fund’s","page_number":556,"box":{"x":497,"y":469,"width":450,"height":10}},{"id":"3cf1ac30-a779-4ee6-885e-5a65bce6cc67","block_type":"box","text":"books. 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Such charges may vary among Service Organizations but in all cases will be retained by the Service Organization and will","page_number":560,"box":{"x":45,"y":195,"width":904,"height":12}},{"id":"3ec94cf9-f47b-4a71-95b7-8ba33379f456","block_type":"box","text":"not be remitted to a Fund or BlackRock.","page_number":560,"box":{"x":45,"y":210,"width":281,"height":10}},{"id":"98e6a35e-6fe7-4446-8ed7-150dda3cdcb4","block_type":"box","text":"Shareholders should consider whether such incentives exist when evaluating any recommendations from a Service Organization to","page_number":560,"box":{"x":46,"y":233,"width":902,"height":13}},{"id":"50978759-5ea8-472e-a119-e36608b1b6ba","block_type":"box","text":"purchase or sell shares of a Fund and when considering which share class is most appropriate.","page_number":560,"box":{"x":45,"y":249,"width":651,"height":12}},{"id":"c6ece2ba-5989-4635-b250-cccce310c0ce","block_type":"box","text":"You should consult with your","page_number":560,"box":{"x":701,"y":249,"width":208,"height":12}},{"id":"7d5aeee8-5f59-4c8a-8e6a-a4de884cafb6","block_type":"box","text":"Service Organization, and review carefully any disclosure by the Service Organization, as to compensation received by it or its","page_number":560,"box":{"x":46,"y":264,"width":871,"height":13}},{"id":"33b97719-d5b2-40cd-92d0-8b76d905e7a8","block_type":"box","text":"affiliates and for more information about the payments described above.","page_number":560,"box":{"x":46,"y":280,"width":502,"height":12}},{"id":"c2a1fc6a-9ea2-4d45-9699-2b4d0317129d","block_type":"box","text":"R","page_number":560,"box":{"x":409,"y":311,"width":12,"height":9}},{"id":"0021edf4-f8cf-449a-b335-c114bdce7a6a","block_type":"box","text":"EDEMPTION OF","page_number":560,"box":{"x":421,"y":313,"width":109,"height":7}},{"id":"730ede41-5aa9-4d16-94c6-1e4737a0f226","block_type":"box","text":"S","page_number":560,"box":{"x":536,"y":310,"width":7,"height":10}},{"id":"2c8b459e-24c2-4cb0-8e20-b9710bfcd921","block_type":"box","text":"HARES","page_number":560,"box":{"x":544,"y":313,"width":45,"height":7}},{"id":"fdc6f74c-2ca3-4b37-956e-cb94d684a4d2","block_type":"box","text":"Each Fund will normally redeem shares for cash upon receipt of a request in proper form, although each Fund retains the right to","page_number":560,"box":{"x":45,"y":335,"width":897,"height":13}},{"id":"2395ea23-2958-43bc-aff7-94931716195d","block_type":"box","text":"redeem some or all of its shares in-kind under unusual circumstan","page_number":560,"box":{"x":45,"y":351,"width":457,"height":10}},{"id":"b96c680d-d50e-410d-b17e-55e4250e66ba","block_type":"box","text":"ces, in order to protect the interests of remaining shareholders,","page_number":560,"box":{"x":502,"y":351,"width":433,"height":12}},{"id":"b7a92339-2406-4550-adba-e4bdf613a127","block_type":"box","text":"or to accommodate a request by a particular shareholder that does not adversely affect the interest of the remaining shareholders,","page_number":560,"box":{"x":46,"y":366,"width":896,"height":13}},{"id":"248e603f-911a-4316-a984-a8b02f572495","block_type":"box","text":"by delivery of securities and other assets selected from the Fund’s portfolio holdings at its discretion. In-kind payment means","page_number":560,"box":{"x":46,"y":382,"width":862,"height":12}},{"id":"9419ffc3-7b75-440e-aa7d-aaaa7f2e8c64","block_type":"box","text":"payment will be made in portfolio securities and other assets rathe","page_number":560,"box":{"x":45,"y":397,"width":460,"height":13}},{"id":"2a39abb6-632d-466e-94bb-2594e86ae53b","block_type":"box","text":"r than cash. If this occurs, the redeeming shareholder might","page_number":560,"box":{"x":505,"y":397,"width":412,"height":13}},{"id":"18f36873-8938-42c9-8843-ac72b45f968c","block_type":"box","text":"incur brokerage or other transaction costs to convert the securities and other assets to cash. In an in-kind redemption, a pro rata","page_number":560,"box":{"x":45,"y":413,"width":889,"height":12}},{"id":"672113f2-4254-44cf-9014-efe4fd4b56c8","block_type":"box","text":"portion of a Fund’s portfolio holdings will generally be distribut","page_number":560,"box":{"x":45,"y":428,"width":444,"height":13}},{"id":"b4043a3c-ea9c-4686-a47a-764bb6e08b2f","block_type":"box","text":"ed to the redeeming shareholder. Each Fund has elected to be","page_number":560,"box":{"x":490,"y":428,"width":424,"height":13}},{"id":"d86af6cc-827d-497a-8b34-f656acb152c8","block_type":"box","text":"governed by Rule 18f-1 under the Investment Company Act so th","page_number":560,"box":{"x":45,"y":444,"width":455,"height":12}},{"id":"3bccda78-2b04-4589-b120-5fdb32f1e80c","block_type":"box","text":"at the Fund is obligated to redeem its shares solely in cash up to","page_number":560,"box":{"x":501,"y":444,"width":440,"height":12}},{"id":"d32e4ae4-6146-4b6c-854b-869c14a8ddf9","block_type":"box","text":"the lesser of $250,000 or 1% of its NAV during any 90-day period for any shareholder of the Fund. The redemption price is the","page_number":560,"box":{"x":45,"y":459,"width":890,"height":13}},{"id":"f24b12a8-abad-4ac6-be9e-a9ebe4bb6ec3","block_type":"box","text":"NAV per share next determined after the initial receipt of proper notice of redemption.","page_number":560,"box":{"x":45,"y":475,"width":602,"height":12}},{"id":"662a9f50-7477-4386-adbb-f70ba46910c0","block_type":"box","text":"The value of the shareholder’s investment at the time of redemption may be more or less than his or her cost, depending on the","page_number":560,"box":{"x":45,"y":498,"width":880,"height":12}},{"id":"7a70592d-82e5-487a-9ed4-2d6ece9b2927","block_type":"box","text":"market value of the securities held by the Fund at such time and","page_number":560,"box":{"x":45,"y":513,"width":443,"height":13}},{"id":"43c2b779-d985-4484-9858-7fa879897f2e","block_type":"box","text":"income earned. The redemption price will be reduced by any","page_number":560,"box":{"x":493,"y":513,"width":420,"height":13}},{"id":"85ce5cc2-54c7-4c3a-8563-7663d9c0afee","block_type":"box","text":"applicable CDSC.","page_number":560,"box":{"x":46,"y":529,"width":122,"height":12}},{"id":"148eb820-e815-45a8-b75c-d52e7c9fd85f","block_type":"box","text":"If notice is received by the Fund’s transfer agent or certain financial","page_number":560,"box":{"x":45,"y":551,"width":466,"height":13}},{"id":"d6851591-beaf-48f5-8343-7fe052cf2bad","block_type":"box","text":"intermediaries, as applicable, prior to the applicable cut-off","page_number":560,"box":{"x":516,"y":551,"width":411,"height":13}},{"id":"85ecd5e5-d6e2-405f-a3d7-51bf2e5be21e","block_type":"box","text":"time on that day, the redemption will be effective on such day. If","page_number":560,"box":{"x":45,"y":567,"width":449,"height":13}},{"id":"1492cd34-72ee-468a-9b83-4c75719a9a00","block_type":"box","text":"the notice is received after the applicable cut-off time, the","page_number":560,"box":{"x":498,"y":567,"width":396,"height":13}},{"id":"fe91c014-6215-4d24-a444-4123e608d337","block_type":"box","text":"redemption will be effective on the next business day and, unless otherwise provided in the Fund’s Prospectus, payment will be","page_number":560,"box":{"x":45,"y":582,"width":878,"height":13}},{"id":"64e92494-7db0-47a9-aaae-1710b85e5535","block_type":"box","text":"made on the second business day after receipt of the notice.","page_number":560,"box":{"x":45,"y":598,"width":411,"height":13}},{"id":"d94085b1-cf60-44b9-82ec-0b7450e29938","block_type":"box","text":"Summit Cash Reserves — Redemption of Shares","page_number":560,"box":{"x":46,"y":628,"width":349,"height":13}},{"id":"e108bc91-0162-4a84-bc9e-d34785924f3f","block_type":"box","text":"Redemptions may be made in the manner and amounts described in Summit Cash Reserves’ Prospectuses. Signatures, when","page_number":560,"box":{"x":46,"y":653,"width":857,"height":13}},{"id":"917172b1-c09d-4eaa-a5c4-04223469bcfc","block_type":"box","text":"required, must conform exactly to the account registration. If (i) the proceeds of the redemption would exceed $250,000 for a","page_number":560,"box":{"x":45,"y":669,"width":873,"height":13}},{"id":"cddd0a7f-67cb-4eac-95d5-6807d3fe00b8","block_type":"box","text":"redemption by wire or ACH, or $100,000 for a redemption by check","page_number":560,"box":{"x":45,"y":684,"width":480,"height":13}},{"id":"1dd3d0ff-08f4-456a-8dc7-4f00822e0e50","block_type":"box","text":", (ii) the Fund does not have verified banking information on","page_number":560,"box":{"x":526,"y":684,"width":421,"height":13}},{"id":"bda597eb-e472-474c-95b5-e562bc89af0a","block_type":"box","text":"file, (iii) the proceeds are not to be paid to the record owner at the record address, or (iv) the shareholder is a corporation,","page_number":560,"box":{"x":45,"y":700,"width":845,"height":13}},{"id":"a520a6bc-3d69-4194-b49b-d5b7e723282e","block_type":"box","text":"partnership, trust or fiduciary, signature(s) must","page_number":560,"box":{"x":45,"y":715,"width":334,"height":13}},{"id":"9aaf16f1-36a8-4c62-8771-546ab5df8a5d","block_type":"box","text":"be guaranteed by any eligible guarantor institution.","page_number":560,"box":{"x":384,"y":715,"width":353,"height":13}},{"id":"893d1a1a-6af3-4121-81b8-b7f8330e3121","block_type":"box","text":"Generally, a properly signed written request with any required signature guarantee is all that is required for a redemption. In some","page_number":560,"box":{"x":46,"y":738,"width":903,"height":13}},{"id":"323583b6-aa59-4dcb-8ce9-cce0f217eb2a","block_type":"box","text":"cases, however, other documents may be necessary. Additional documentary evidence of authority is required by BNY Mellon","page_number":560,"box":{"x":45,"y":754,"width":877,"height":13}},{"id":"e0c5721e-508f-46eb-9886-0227e5a7fe60","block_type":"box","text":"Investment Servicing (US) Inc. in the event redemption is request","page_number":560,"box":{"x":45,"y":769,"width":446,"height":13}},{"id":"7f049dd8-eae7-485d-8cef-26304604f03c","block_type":"box","text":"ed by a corporation, partnership, trust, fiduciary, executor or","page_number":560,"box":{"x":492,"y":769,"width":424,"height":13}},{"id":"4154b4a0-f037-4a02-a9dd-7f65d3e24078","block_type":"box","text":"administrator. See “Signature Guarantee” below.","page_number":560,"box":{"x":46,"y":785,"width":340,"height":13}},{"id":"e0b11366-93fb-4370-a8dd-67a0d457fe1a","block_type":"box","text":"Note on Low Balance Accounts","page_number":560,"box":{"x":45,"y":808,"width":222,"height":10}},{"id":"e9ee4961-f441-4cb9-b896-56472d24305c","block_type":"box","text":". Because of the high cost of maintaining smaller shareholder accounts, BlackRock has set a","page_number":560,"box":{"x":269,"y":808,"width":633,"height":13}},{"id":"9e2733fb-2060-47d9-8ef8-44091c782ad4","block_type":"box","text":"minimum balance of $500 in each Fund position you hold within your account (the “Fund Minimum”), and may redeem the","page_number":560,"box":{"x":45,"y":823,"width":869,"height":13}},{"id":"d9c937cf-82f8-49eb-ac3b-9757103a25e7","block_type":"box","text":"shares in your account if the NAV of those shares in your account falls below $500 for any reason, including market fluctuation.","page_number":560,"box":{"x":46,"y":838,"width":893,"height":14}},{"id":"0ee5cde6-b904-45fc-87b7-67a9865d1867","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 involuntary","page_number":560,"box":{"x":45,"y":862,"width":850,"height":12}},{"id":"1b876406-f84f-46b3-8fa5-bbf74351b6fb","block_type":"box","text":"redemption. This notification will provide you with a 90 calendar day period to make an additional investment in order to bring","page_number":560,"box":{"x":45,"y":877,"width":891,"height":13}},{"id":"402893b0-242c-4d1c-ac32-1f0c4e00446b","block_type":"box","text":"II-50","page_number":560,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"659f229d-117a-4b98-90a7-1b8918b6823a","block_type":"box","text":"NM1026U-6004382-560/605","page_number":560,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c2e01239-0c2e-4aa9-b39d-e5c1ebc30860","block_type":"box","text":"the value of your account to at least $500 before the Fund makes an involuntary redemption. This involuntary redemption will","page_number":561,"box":{"x":45,"y":78,"width":881,"height":14}},{"id":"931096ec-871e-47d2-b8dc-1b675e7824e8","block_type":"box","text":"not charge any deferred sales charge, and may not apply to accounts of certain employer-sponsored retirement plans (not","page_number":561,"box":{"x":45,"y":94,"width":841,"height":13}},{"id":"9c587b72-e375-4abc-bf13-8b9ab70f9cee","block_type":"box","text":"including IRAs), qualified state tuition plan (529 Plan) accounts, and select fee-based programs at your financial intermediary.","page_number":561,"box":{"x":45,"y":110,"width":874,"height":13}},{"id":"f35368d8-e43f-43a6-b48e-724547e788d2","block_type":"box","text":"Payment of Redemption Proceeds","page_number":561,"box":{"x":45,"y":133,"width":234,"height":13}},{"id":"a037d7c2-cb28-414d-8c33-2616a1c08c85","block_type":"box","text":". The Fund may suspend the right of redemption or postpone the date of payment upon","page_number":561,"box":{"x":280,"y":133,"width":607,"height":13}},{"id":"66359d0b-1283-4a93-af83-88cf1b1bf8e2","block_type":"box","text":"redemption for such periods as are permitted under the Investment Company Act, and may redeem shares involuntarily or make","page_number":561,"box":{"x":45,"y":148,"width":891,"height":13}},{"id":"750ba463-b883-4fd8-b20c-0eff060b3835","block_type":"box","text":"payment for redemption in securities or other property when d","page_number":561,"box":{"x":45,"y":164,"width":435,"height":13}},{"id":"524d525b-76bb-4583-8396-548437df7a76","block_type":"box","text":"etermined appropriate in light of the Fund’s responsibilities under","page_number":561,"box":{"x":481,"y":164,"width":455,"height":13}},{"id":"0fa0cc37-6721-4882-9b66-c68155b4c01e","block_type":"box","text":"the Investment Company Act.","page_number":561,"box":{"x":45,"y":179,"width":207,"height":13}},{"id":"7bca2c31-521d-4a51-af44-bdab13410bce","block_type":"box","text":"The Fund reserves the right, if conditions exist which make cash p","page_number":561,"box":{"x":45,"y":202,"width":458,"height":13}},{"id":"bc7430c8-0146-48a0-afd0-cbb33285a911","block_type":"box","text":"ayments undesirable, to honor any request for redemption or","page_number":561,"box":{"x":504,"y":202,"width":423,"height":13}},{"id":"d2282cba-02cb-4706-99c4-d14042067505","block_type":"box","text":"repurchase of the Fund’s shares by making payment in whole or in part in securities chosen by the Fund and valued in the same","page_number":561,"box":{"x":45,"y":218,"width":884,"height":13}},{"id":"02064e9a-3a01-4ecc-9985-89817da1e6dc","block_type":"box","text":"way as they would be valued for purposes of computing the Fund’s NAV. If payment is made in securities, a shareholder may","page_number":561,"box":{"x":45,"y":233,"width":872,"height":13}},{"id":"b4f9ba0f-8f61-44a0-a35e-a34e1793e397","block_type":"box","text":"incur transaction costs in converting these securities into cash. The Fund has elected, however, to be governed by Rule 18f-1 under","page_number":561,"box":{"x":45,"y":249,"width":906,"height":13}},{"id":"64e2dc68-1267-40b3-b546-4e244f65149e","block_type":"box","text":"the Investment Company Act so that the Fund is obligated to redeem its shares solely in cash up to the lesser of $250,000 or 1%","page_number":561,"box":{"x":45,"y":264,"width":890,"height":13}},{"id":"272df270-e59c-4625-8cf0-9e9b3c7931d6","block_type":"box","text":"of its NAV during any 90-day period for any one shareholder of the Fund.","page_number":561,"box":{"x":46,"y":280,"width":515,"height":13}},{"id":"1a35cd1f-9382-4ce2-b47b-84514c8d042f","block_type":"box","text":"Under the Investment Company Act, the Fund may suspend the right to redemption or postpone the date of payment upon","page_number":561,"box":{"x":45,"y":303,"width":853,"height":13}},{"id":"8dcde619-7833-4365-b14c-49cd59415de4","block_type":"box","text":"redemption for any period during which the NYSE is closed (oth","page_number":561,"box":{"x":45,"y":318,"width":449,"height":13}},{"id":"bef681ed-e928-4ac1-b7eb-604e812a005d","block_type":"box","text":"er than customary weekend and holiday closings), or during","page_number":561,"box":{"x":495,"y":318,"width":416,"height":13}},{"id":"268d24fd-153a-4d05-9b66-3b99d4f30c5e","block_type":"box","text":"which trading on the NYSE is restricted, or during which (as determined by the SEC by rule or regulation) an emergency exists as","page_number":561,"box":{"x":45,"y":334,"width":898,"height":13}},{"id":"14487b01-45c5-4052-9912-4b964a9c9127","block_type":"box","text":"a result of which disposal or valuation of portfolio securities is not reasonably practicable, or for such other periods as the SEC","page_number":561,"box":{"x":46,"y":349,"width":879,"height":13}},{"id":"d6f2c6ba-00e4-489e-9257-bb69718b702d","block_type":"box","text":"may permit. (The Fund may also suspend or postpone the recordation of the transfer of its shares upon the occurrence of any of","page_number":561,"box":{"x":45,"y":365,"width":888,"height":13}},{"id":"a3ab2c2e-40f3-4ab2-b0db-e73c96f05dac","block_type":"box","text":"the foregoing conditions.)","page_number":561,"box":{"x":45,"y":380,"width":178,"height":13}},{"id":"5a268e3d-a87d-4a8a-bbd1-3ff9ef4934d8","block_type":"box","text":"The Fund may redeem shares involuntarily to reimburse the Fund fo","page_number":561,"box":{"x":45,"y":403,"width":474,"height":13}},{"id":"69de067f-5b61-413f-987e-53b64ee21e6b","block_type":"box","text":"r any loss sustained by reason of the failure of a shareholder","page_number":561,"box":{"x":520,"y":403,"width":416,"height":13}},{"id":"4a13191e-e9d3-4a80-9fa1-0d33f8a1065d","block_type":"box","text":"to make full payment for shares purchased by the shareholder or t","page_number":561,"box":{"x":45,"y":419,"width":459,"height":13}},{"id":"5b620023-b71a-423a-8c0b-80bd5cccab55","block_type":"box","text":"o collect any charge relating to a transaction effected for the","page_number":561,"box":{"x":504,"y":419,"width":416,"height":13}},{"id":"69d9fe6a-44e1-4da8-bf53-fcd294a16124","block_type":"box","text":"benefit of a shareholder. The Fund reserves the express right to redeem shares of the Fund involuntarily at any time if the Board of","page_number":561,"box":{"x":46,"y":434,"width":904,"height":13}},{"id":"4c4b6578-77a5-4740-8f1d-a21ab125ffc6","block_type":"box","text":"Trustees determines, in its sole discretion, that failure to do so ma","page_number":561,"box":{"x":45,"y":450,"width":455,"height":12}},{"id":"2ad8fba7-dacc-42a3-913d-b8460a8f1549","block_type":"box","text":"y have adverse consequences to the holders of shares in the Fund.","page_number":561,"box":{"x":501,"y":450,"width":452,"height":13}},{"id":"81e04d0d-5bb6-474f-a773-183191915d09","block_type":"box","text":"Upon such redemption the holders of shares so redeemed shal","page_number":561,"box":{"x":45,"y":465,"width":428,"height":13}},{"id":"328dcd39-da76-49c7-a80f-c4e93f667ccd","block_type":"box","text":"l have no further right with respect thereto other than to receive","page_number":561,"box":{"x":474,"y":465,"width":442,"height":13}},{"id":"0e353f30-a10c-4054-9c99-ceb8a08c481c","block_type":"box","text":"payment of the redemption price.","page_number":561,"box":{"x":45,"y":481,"width":231,"height":13}},{"id":"b8ea340a-a510-4dd2-8c61-e0587b126532","block_type":"box","text":"Signature Guarantee","page_number":561,"box":{"x":46,"y":504,"width":141,"height":13}},{"id":"99c4f70b-77e4-45f6-8d2d-0ee692bc08cf","block_type":"box","text":". A signature guarantee is designed to protect the shareholders and the Fund against fraudulent transactions","page_number":561,"box":{"x":189,"y":504,"width":744,"height":13}},{"id":"7e17dc38-43ad-4f33-9c3a-67859090ac82","block_type":"box","text":"by unauthorized persons. A signature guarantee may be obtai","page_number":561,"box":{"x":46,"y":519,"width":426,"height":13}},{"id":"ded72f29-4c45-4536-84b1-2c0dd58f443f","block_type":"box","text":"ned from a domestic bank or trust company, recognized broker,","page_number":561,"box":{"x":472,"y":519,"width":444,"height":13}},{"id":"c585dc49-5925-4514-9bd8-1eb5198148a4","block_type":"box","text":"dealer, clearing agency, savings association who are participants in a medallion program by the Securities Transfer Association,","page_number":561,"box":{"x":46,"y":535,"width":881,"height":13}},{"id":"00499811-fd96-46c3-9ac0-c332c4ff29f2","block_type":"box","text":"credit unions, national securities exchanges and registered secur","page_number":561,"box":{"x":45,"y":550,"width":441,"height":13}},{"id":"b1555d5a-ec7f-4961-90e7-893368fd9f60","block_type":"box","text":"ities associations. The three recognized medallion programs are","page_number":561,"box":{"x":486,"y":550,"width":439,"height":13}},{"id":"8b0faaa6-b0c1-447f-8649-1d318a219286","block_type":"box","text":"Securities Transfer Agent Medallion Program (STAMP), Stock Exchanges Medallion Program (SEMP) and New York Stock","page_number":561,"box":{"x":46,"y":566,"width":862,"height":13}},{"id":"bec797d2-eb6a-4de0-8656-e06dc0348643","block_type":"box","text":"Exchange, Inc. Medallion Signature Program (MSP). Signature Guarantees which are not a part of these programs will not be","page_number":561,"box":{"x":45,"y":581,"width":871,"height":13}},{"id":"89dcd219-fc5b-44cf-88db-b9e34cec9956","block_type":"box","text":"accepted. Please note that a notary public stamp or seal is not acceptable.","page_number":561,"box":{"x":46,"y":597,"width":506,"height":13}},{"id":"1d52a062-6150-4bbd-ae79-84169a25dad5","block_type":"box","text":"WeLEAF — Redemption of Shares","page_number":561,"box":{"x":45,"y":627,"width":252,"height":13}},{"id":"0d00a12b-f8da-4abb-9f6d-0a8c421e4498","block_type":"box","text":"Redemptions may be made in the manner and amounts described in W","page_number":561,"box":{"x":46,"y":653,"width":492,"height":13}},{"id":"6b8e759d-2618-4ec1-9b90-ac1b72d74d67","block_type":"box","text":"eLEAF’s Prospectuses. Signatures, when required, must","page_number":561,"box":{"x":539,"y":653,"width":382,"height":13}},{"id":"cff9f890-1ad0-400f-912a-ce7fb984eaae","block_type":"box","text":"conform exactly to the account registration. If (i) the proceed","page_number":561,"box":{"x":45,"y":668,"width":424,"height":13}},{"id":"bde2e3c0-44f5-46eb-b95a-7bc8bd7ed0bc","block_type":"box","text":"s of the redemption would exceed $250,000 for a redemption by wire","page_number":561,"box":{"x":469,"y":668,"width":484,"height":13}},{"id":"ca7ce6c8-3919-470d-8a4e-b37ca8bd63d8","block_type":"box","text":"or ACH, or $100,000 for a redemption by check, (ii) the Fund does","page_number":561,"box":{"x":46,"y":684,"width":468,"height":13}},{"id":"eea6aeb5-5884-4a14-85aa-f5c14be773b2","block_type":"box","text":"not have verified banking information on file, (iii) the","page_number":561,"box":{"x":520,"y":684,"width":370,"height":13}},{"id":"8170b7c5-f6d7-42be-b87f-3caa1e9a171e","block_type":"box","text":"proceeds are not to be paid to the record owner at the record address, or (iv) the shareholder is a corporation, partnership, trust or","page_number":561,"box":{"x":45,"y":699,"width":906,"height":13}},{"id":"168833df-6c64-44de-bfed-fca9e3e24d71","block_type":"box","text":"fiduciary, signature(s) must be guaranteed by any eligible guarantor institution.","page_number":561,"box":{"x":45,"y":715,"width":548,"height":13}},{"id":"41d3fcef-4ae6-4e45-b01e-26be0bde2d3a","block_type":"box","text":"Generally, a properly signed written request with any required signature guarantee is all that is required for a redemption. In some","page_number":561,"box":{"x":46,"y":738,"width":903,"height":13}},{"id":"c4e58af2-81ef-4aa4-be9c-2bf490180c45","block_type":"box","text":"cases, however, other documents may be necessary. Additional documentary evidence of authority is required by BNY Mellon","page_number":561,"box":{"x":45,"y":753,"width":877,"height":13}},{"id":"d167efd4-6d9f-41aa-93aa-2f43cf8df983","block_type":"box","text":"Investment Servicing (US) Inc. in the event redemption is request","page_number":561,"box":{"x":45,"y":769,"width":446,"height":13}},{"id":"ca59a24e-e3ef-4b2c-aaf6-470f9c219dd7","block_type":"box","text":"ed by a corporation, partnership, trust, fiduciary, executor or","page_number":561,"box":{"x":492,"y":769,"width":424,"height":13}},{"id":"6d828d70-e127-492c-94dd-3c0f463d330c","block_type":"box","text":"administrator. See “Signature Guarantee” below.","page_number":561,"box":{"x":46,"y":784,"width":340,"height":13}},{"id":"a01b4485-7ebd-4b58-be4d-653b9a93d81e","block_type":"box","text":"Note on Low Balance Accounts.","page_number":561,"box":{"x":45,"y":807,"width":226,"height":10}},{"id":"050cb66b-08d7-455b-b3e5-4de61229e627","block_type":"box","text":"Because of the high cost of maintaining smaller shareholder accounts, BlackRock has set a","page_number":561,"box":{"x":277,"y":807,"width":625,"height":13}},{"id":"99055d8c-8b97-4485-b85e-80c1f371db1e","block_type":"box","text":"minimum balance of $500 in each Fund position you hold within your account (“Fund Minimum”), and may redeem the shares in","page_number":561,"box":{"x":45,"y":823,"width":909,"height":13}},{"id":"0511cc88-1f6e-4f8d-ad94-8225354852a6","block_type":"box","text":"your account if the NAV of those shares in your account falls below $500 for any reason, including market fluctuation.","page_number":561,"box":{"x":45,"y":838,"width":829,"height":13}},{"id":"4e0abfb9-46e7-418d-a948-ac96737cd5ce","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 involuntary","page_number":561,"box":{"x":45,"y":861,"width":850,"height":13}},{"id":"82598670-fb88-4720-a528-479abfce8b89","block_type":"box","text":"redemption. This notification will provide you with a 90 calendar day period to make an additional investment in order to bring","page_number":561,"box":{"x":45,"y":877,"width":891,"height":13}},{"id":"bb353d86-c4c8-4cc8-81c1-a04749d66360","block_type":"box","text":"II-51","page_number":561,"box":{"x":482,"y":917,"width":33,"height":9}},{"id":"35d2f60c-bd13-486d-818a-d45fbeda9ed6","block_type":"box","text":"NM1026U-6004382-561/605","page_number":561,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"2ad9f570-65e2-4bfb-a4ad-f43a7d0daeed","block_type":"box","text":"the value of your account to at least $500 before the Fund makes an involuntary redemption. This involuntary redemption will","page_number":562,"box":{"x":45,"y":78,"width":881,"height":14}},{"id":"ab1687b2-95bc-4373-8a30-8ab84a66c27d","block_type":"box","text":"not charge any deferred sales charge, and may not apply to accounts of certain employer-sponsored retirement plans (not","page_number":562,"box":{"x":45,"y":94,"width":841,"height":13}},{"id":"af2efd18-1b37-4477-8584-bbef1a4225ea","block_type":"box","text":"including IRAs), qualified state tuition plan (529 Plan) accounts, and select fee-based programs at your financial intermediary.","page_number":562,"box":{"x":45,"y":110,"width":874,"height":13}},{"id":"25d44750-4a86-4256-a375-fcab6fc6f629","block_type":"box","text":"Service Shares","page_number":562,"box":{"x":45,"y":139,"width":101,"height":10}},{"id":"eb1f3681-1f16-4329-8b24-750f2f763ebb","block_type":"box","text":"Redemption of Shares.","page_number":562,"box":{"x":45,"y":164,"width":157,"height":13}},{"id":"6e2e592a-204f-40ce-a45b-1f445df5b092","block_type":"box","text":"WeLEAF may redeem Service Shares if the account balance drops below the required minimum initial","page_number":562,"box":{"x":207,"y":164,"width":706,"height":13}},{"id":"82098253-1f2a-481a-ae17-532ad6c40f48","block_type":"box","text":"investment as the result of redemption requests and the shareholder does not increase the balance to at least the required minimum","page_number":562,"box":{"x":45,"y":179,"width":907,"height":13}},{"id":"97d4dd72-8dd3-40c6-bc4a-08e2ea3aba2b","block_type":"box","text":"initial investment upon thirty days’ written notice. If a customer has agreed with an institution to maintain a minimum balance in","page_number":562,"box":{"x":45,"y":195,"width":899,"height":13}},{"id":"4b14e839-797a-423a-bd84-c4dfa2d1916e","block_type":"box","text":"his or her account with the institution, and the balance in the account falls below that minimum, the customer may be obligated to","page_number":562,"box":{"x":45,"y":210,"width":907,"height":13}},{"id":"4f83efab-2e76-4874-908f-94f6b6a16770","block_type":"box","text":"redeem all or part of his or her shares in the Fund to the extent necessary to maintain the minimum balance required.","page_number":562,"box":{"x":45,"y":226,"width":812,"height":13}},{"id":"60185e57-8dd6-4429-a819-bf44b9ab732e","block_type":"box","text":"The following is applicable only to persons who were shareholders of an investment portfolio of Compass Capital Group of","page_number":562,"box":{"x":45,"y":248,"width":903,"height":13}},{"id":"8828f395-3c1e-4182-99d1-5631ff0815e0","block_type":"box","text":"Funds at the time of the Trust’s combination with The PNC Fund in 1996:","page_number":562,"box":{"x":45,"y":264,"width":544,"height":10}},{"id":"13f633e4-db99-4ebe-b7e5-0235ae3122d3","block_type":"box","text":"Persons who were shareholders of an investment portfolio of Compass Capital Group of Funds at the time of the portfolio’s","page_number":562,"box":{"x":45,"y":286,"width":861,"height":13}},{"id":"aec669ba-5e30-4b9e-b525-703313487aa7","block_type":"box","text":"combination with The PNC Fund may also purchase and redeem Service Shares of the same Fund and for the same account in","page_number":562,"box":{"x":45,"y":302,"width":876,"height":12}},{"id":"657b372e-6636-4b43-9222-cd5fae202e1b","block_type":"box","text":"which they held shares on that date through the procedures described in this section.","page_number":562,"box":{"x":45,"y":317,"width":585,"height":13}},{"id":"304646ab-b325-4665-85ee-fdc02f4102a4","block_type":"box","text":"Payment of Redemption Proceeds.","page_number":562,"box":{"x":45,"y":340,"width":238,"height":12}},{"id":"63719ae5-c637-4dbc-9bcb-fd5c67fa9742","block_type":"box","text":"The Fund may suspend the right of redemption or postpone the date of payment upon","page_number":562,"box":{"x":288,"y":340,"width":599,"height":12}},{"id":"65ded5e9-f42f-454b-ac14-2704e08d3c9b","block_type":"box","text":"redemption for such periods as are permitted under the Investment Company Act, and may redeem shares involuntarily or make","page_number":562,"box":{"x":45,"y":355,"width":891,"height":13}},{"id":"a10e3d74-9c1d-4ede-a490-82b6aa863fdb","block_type":"box","text":"payment for redemption in securities or other property when d","page_number":562,"box":{"x":45,"y":371,"width":435,"height":12}},{"id":"774ec561-4c3f-4c75-b6d3-68d7288a678c","block_type":"box","text":"etermined appropriate in light of the Fund’s responsibilities under","page_number":562,"box":{"x":481,"y":371,"width":455,"height":12}},{"id":"d63c1bfe-3ee9-467a-8d78-ff4262d2dfde","block_type":"box","text":"the Investment Company Act.","page_number":562,"box":{"x":45,"y":386,"width":207,"height":13}},{"id":"9e4fc783-edd3-41a1-9f14-03213b50fad5","block_type":"box","text":"The Fund reserves the right, if conditions exist which make cash p","page_number":562,"box":{"x":45,"y":408,"width":458,"height":13}},{"id":"20c20370-2577-4ead-adad-6eed9a0411f3","block_type":"box","text":"ayments undesirable, to honor any request for redemption or","page_number":562,"box":{"x":504,"y":408,"width":423,"height":13}},{"id":"29c9c793-4936-4c7d-a5fd-7df4f203f1c6","block_type":"box","text":"repurchase of the Fund’s shares by making payment in whole or in part in securities chosen by the Fund and valued in the same","page_number":562,"box":{"x":45,"y":424,"width":884,"height":13}},{"id":"5f7284c0-6377-491f-b0d2-eed804da2d5b","block_type":"box","text":"way as they would be valued for purposes of computing the Fund’s NAV. If payment is made in securities, a shareholder may","page_number":562,"box":{"x":45,"y":440,"width":872,"height":12}},{"id":"854aeedd-5559-4b37-9ea1-e0f8f75abb6b","block_type":"box","text":"incur transaction costs in converting these securities into cash. The Fund has elected, however, to be governed by Rule 18f-1 under","page_number":562,"box":{"x":45,"y":455,"width":906,"height":13}},{"id":"77939e71-d3f6-4c60-a6eb-b3883f34c1ae","block_type":"box","text":"the Investment Company Act so that the Fund is obligated to redeem its shares solely in cash up to the lesser of $250,000 or 1%","page_number":562,"box":{"x":45,"y":470,"width":890,"height":13}},{"id":"30daf8c3-866e-4eff-a062-df3fcdab76bc","block_type":"box","text":"of its NAV during any 90-day period for any one shareholder of the Fund.","page_number":562,"box":{"x":46,"y":486,"width":515,"height":13}},{"id":"7b39871b-8b14-4a9a-a34e-d50f6b9c3637","block_type":"box","text":"The Board of the Trust, or its delegate, will be permitted to impose a discretionary liquidity fee on redemptions from WeLEAF (up","page_number":562,"box":{"x":45,"y":508,"width":905,"height":13}},{"id":"f3d97664-4e2d-47bf-86e7-c804e3b1cf83","block_type":"box","text":"to 2%). Please see the Fund’s Prospectus for additional information about discretionary liquidity fees.","page_number":562,"box":{"x":45,"y":524,"width":704,"height":13}},{"id":"adaa2cec-1d13-480e-9414-9c04a1870aef","block_type":"box","text":"Under the Investment Company Act, the Fund may suspend the right to redemption or postpone the date of payment upon","page_number":562,"box":{"x":45,"y":546,"width":853,"height":13}},{"id":"cbfe5e2c-abd6-44c0-878c-1fe3384007b9","block_type":"box","text":"redemption for any period during which the NYSE is closed (oth","page_number":562,"box":{"x":45,"y":562,"width":449,"height":13}},{"id":"f1de5b0d-2952-4a97-858e-1607e3bc1cfd","block_type":"box","text":"er than customary weekend and holiday closings), or during","page_number":562,"box":{"x":495,"y":562,"width":416,"height":13}},{"id":"858169d9-789a-439b-a652-54a0f25d55a7","block_type":"box","text":"which trading on the NYSE is restricted, or during which (as determined by the SEC by rule or regulation) an emergency exists as","page_number":562,"box":{"x":45,"y":577,"width":898,"height":13}},{"id":"30f1a4d9-e2ee-4aac-8898-2d921c2a113d","block_type":"box","text":"a result of which disposal or valuation or portfolio securities is not reasonably practicable, or for such other periods as the SEC","page_number":562,"box":{"x":46,"y":593,"width":880,"height":13}},{"id":"a36c4390-5a13-44d7-bc8f-62d2917564b6","block_type":"box","text":"may permit. (The Fund may also suspend or postpone the recordation of the transfer of its shares upon the occurrence of any of","page_number":562,"box":{"x":45,"y":608,"width":888,"height":13}},{"id":"71a806b8-3d27-4b78-baaf-3ac262b5904f","block_type":"box","text":"the foregoing conditions.)","page_number":562,"box":{"x":45,"y":624,"width":178,"height":13}},{"id":"c41d9646-1c5c-43c1-86ca-d72c5717263a","block_type":"box","text":"The Fund may redeem shares involuntarily to reimburse the Fund fo","page_number":562,"box":{"x":45,"y":646,"width":474,"height":13}},{"id":"20788c57-5b7f-4a00-ad7f-190a6c1d1b2a","block_type":"box","text":"r any loss sustained by reason of the failure of a shareholder","page_number":562,"box":{"x":520,"y":646,"width":416,"height":13}},{"id":"b365b26e-12a6-45a1-af6b-88d61d2443ed","block_type":"box","text":"to make full payment for shares purchased by the shareholder or t","page_number":562,"box":{"x":45,"y":662,"width":459,"height":13}},{"id":"4c4f5033-848e-4072-b237-3fa41c04fc69","block_type":"box","text":"o collect any charge relating to a transaction effected for the","page_number":562,"box":{"x":504,"y":662,"width":416,"height":13}},{"id":"ef18a0ac-33c8-4325-bce5-16272b2ffb85","block_type":"box","text":"benefit of a shareholder. The Fund reserves the express right to redeem shares of the Fund involuntarily at any time if the Board of","page_number":562,"box":{"x":46,"y":677,"width":904,"height":13}},{"id":"30a97ede-8b88-46dc-854c-9b01572bb044","block_type":"box","text":"Trustees determines, in its sole discretion, that failure to do so ma","page_number":562,"box":{"x":45,"y":693,"width":455,"height":12}},{"id":"cc96cf11-d346-441e-a5dd-ff91434eadd9","block_type":"box","text":"y have adverse consequences to the holders of shares in the Fund.","page_number":562,"box":{"x":501,"y":693,"width":452,"height":13}},{"id":"f81f91b9-e97d-4b88-aa86-9af72f3267bd","block_type":"box","text":"Upon such redemption the holders of shares so redeemed shal","page_number":562,"box":{"x":45,"y":708,"width":428,"height":13}},{"id":"bea8592e-204d-4f48-ad85-fb5f35a25b3b","block_type":"box","text":"l have no further right with respect thereto other than to receive","page_number":562,"box":{"x":474,"y":708,"width":442,"height":13}},{"id":"e92fa587-c63e-428a-991c-e6f11fa98bfc","block_type":"box","text":"payment of the redemption price.","page_number":562,"box":{"x":45,"y":724,"width":231,"height":13}},{"id":"59c10a54-5aa1-4f54-b243-3a33bff12b87","block_type":"box","text":"WeLEAF reserves the right to redeem shares in any account that it cannot confirm to its satisfaction is beneficially owned by a","page_number":562,"box":{"x":45,"y":746,"width":875,"height":13}},{"id":"16650e6a-6971-4e85-8dfa-2ff815ead264","block_type":"box","text":"natural person, after providing at least 60 days’ advance notice.","page_number":562,"box":{"x":45,"y":762,"width":440,"height":13}},{"id":"bd6027fe-dc3a-4105-a2f2-39d2388d5874","block_type":"box","text":"Signature Guarantee.","page_number":562,"box":{"x":46,"y":785,"width":145,"height":12}},{"id":"7de35e4e-a4fe-4937-bb03-d99053da554b","block_type":"box","text":"A signature guarantee is designed to protect the shareholders and the Fund against fraudulent transactions","page_number":562,"box":{"x":197,"y":784,"width":736,"height":13}},{"id":"466a4401-b7a3-436d-86ae-1591a821ef47","block_type":"box","text":"by unauthorized persons. A signature guarantee may be obtai","page_number":562,"box":{"x":46,"y":800,"width":426,"height":12}},{"id":"c579257d-4e21-49e5-9539-3d39f5399a81","block_type":"box","text":"ned from a domestic bank or trust company, recognized broker,","page_number":562,"box":{"x":472,"y":800,"width":444,"height":12}},{"id":"a7189c93-56dc-4db3-84d0-eaf6cc4988bf","block_type":"box","text":"dealer, clearing agency, savings association who are participants in a medallion program by the Securities Transfer Association,","page_number":562,"box":{"x":46,"y":815,"width":881,"height":13}},{"id":"63cd2981-31d9-434e-9dd3-a3589bc56576","block_type":"box","text":"credit unions, national securities exchanges and registered secur","page_number":562,"box":{"x":45,"y":831,"width":441,"height":12}},{"id":"ab4a1d57-28e4-4028-8c13-e4c4517a5e9b","block_type":"box","text":"ities associations. The three recognized medallion programs are","page_number":562,"box":{"x":486,"y":831,"width":439,"height":12}},{"id":"39c38597-038b-4620-9559-ab05afa4770c","block_type":"box","text":"Securities Transfer Agent Medallion Program (STAMP), Stock Exchanges Medallion Program (SEMP) and New York Stock","page_number":562,"box":{"x":46,"y":846,"width":862,"height":13}},{"id":"78ce9569-8b7d-4df5-97a8-52f5849a05f8","block_type":"box","text":"Exchange, Inc. Medallion Signature Program (MSP). Signature Guarantees which are not a part of these programs will not be","page_number":562,"box":{"x":45,"y":862,"width":871,"height":12}},{"id":"a922732f-62fa-4a42-a69d-83e830a63c3f","block_type":"box","text":"accepted. Please note that a notary public stamp or seal is not acceptable.","page_number":562,"box":{"x":46,"y":877,"width":506,"height":13}},{"id":"5d6dd896-5c46-4a89-a45d-114aae0cf6af","block_type":"box","text":"II-52","page_number":562,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"2a263992-5598-4024-a59e-bfb83940ab87","block_type":"box","text":"NM1026U-6004382-562/605","page_number":562,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"0b39aa55-0166-478b-8096-14e609a6e5b1","block_type":"box","text":"Circle Reserve — Redemption of Shares","page_number":563,"box":{"x":46,"y":79,"width":288,"height":13}},{"id":"570bcfb9-2e6c-479c-9bb2-8a5e92c5b5ae","block_type":"box","text":"Redemptions may be made in the manner and amounts described in Circle Reserve’s Prospectus. Signatures, when required, must","page_number":563,"box":{"x":46,"y":104,"width":897,"height":13}},{"id":"b1a82861-6346-44c2-b834-e9a542482101","block_type":"box","text":"conform exactly to the account registration. If (i) the pro","page_number":563,"box":{"x":45,"y":119,"width":393,"height":13}},{"id":"afdf0fac-7d3b-4242-aa53-fb8dbc0a61ff","block_type":"box","text":"ceeds of the redemption would exceed $250,000 for a redemption by","page_number":563,"box":{"x":439,"y":119,"width":479,"height":13}},{"id":"185adaa0-f5ef-4bec-bb4f-db9b9dd0f2ea","block_type":"box","text":"wire, (ii) the Fund does not have verified banking information o","page_number":563,"box":{"x":45,"y":135,"width":443,"height":13}},{"id":"826f5a78-4b7f-4f7d-a809-0f633aee8451","block_type":"box","text":"n file, (iii) the proceeds are not to be paid to the record owner at","page_number":563,"box":{"x":489,"y":135,"width":445,"height":13}},{"id":"e0117af6-7fdb-4fd2-bca3-e2e40a9c02da","block_type":"box","text":"the record address, or (iv) the shareholder is a corporation, partn","page_number":563,"box":{"x":45,"y":150,"width":450,"height":13}},{"id":"2ada896d-a9bd-44d2-ba81-950838eb06d8","block_type":"box","text":"ership, trust or fiduciary, signature(s) may need to be guaranteed","page_number":563,"box":{"x":496,"y":150,"width":449,"height":13}},{"id":"aa516e23-8e4e-4aae-83fc-ff513c934923","block_type":"box","text":"by any eligible guarantor institution.","page_number":563,"box":{"x":46,"y":166,"width":251,"height":13}},{"id":"9a38ea95-46eb-4c0b-9cee-61bbe3bc5f90","block_type":"box","text":"Generally, a properly signed written request with any required signature guarantee is all that is required for a redemption. In some","page_number":563,"box":{"x":46,"y":191,"width":903,"height":13}},{"id":"8180ae36-e8bf-4761-8dba-14ca893fa29f","block_type":"box","text":"cases, however, other documents may be necessary. Additional documentary evidence of authority is required by BNY Mellon","page_number":563,"box":{"x":45,"y":206,"width":877,"height":13}},{"id":"3cc1300e-8fe1-4579-896d-b809482e6fac","block_type":"box","text":"Investment Servicing (US) Inc. in the event redemption is request","page_number":563,"box":{"x":45,"y":222,"width":446,"height":13}},{"id":"b8c466c4-5ac0-442a-8737-2ad7ff548e46","block_type":"box","text":"ed by a corporation, partnership, trust, fiduciary, executor or","page_number":563,"box":{"x":492,"y":222,"width":424,"height":13}},{"id":"07372d07-8fd7-4736-a334-c7af6b1943d2","block_type":"box","text":"administrator. See “Signature Guarantee” below.","page_number":563,"box":{"x":46,"y":237,"width":340,"height":13}},{"id":"671691fa-b6dd-4d70-8f5c-0697f1c4ffba","block_type":"box","text":"Note on Low Balance Accounts","page_number":563,"box":{"x":45,"y":260,"width":222,"height":10}},{"id":"23bbdcb0-ad17-4c46-92d2-c4d3f929c6a9","block_type":"box","text":". Because of the high cost of maintaining smaller shareholder accounts, BlackRock has set a","page_number":563,"box":{"x":269,"y":260,"width":633,"height":13}},{"id":"bbe8635b-abeb-4204-8980-e4b36f2a1f1c","block_type":"box","text":"minimum balance of $100,000 in the Fund position you hold within your account (“Fund Minimum”), and may redeem the","page_number":563,"box":{"x":45,"y":275,"width":865,"height":13}},{"id":"0bca4d0d-4b1f-40fb-886a-0ab8bfc45ddc","block_type":"box","text":"shares in your account if the NAV of those shares in your account falls below $100,000 for any reason, including market","page_number":563,"box":{"x":46,"y":291,"width":840,"height":13}},{"id":"43c1ca42-e511-4aac-a885-9104411d8f1e","block_type":"box","text":"fluctuation.","page_number":563,"box":{"x":45,"y":307,"width":79,"height":10}},{"id":"45a6ccd4-0d5c-4852-a0c4-2f38a5415895","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 involuntary","page_number":563,"box":{"x":45,"y":329,"width":850,"height":13}},{"id":"7c58af2f-b2a2-4b52-8d03-fa5aa65fa2d9","block_type":"box","text":"redemption. This notification will provide you with a 90 calendar day period to make an additional investment in order to bring","page_number":563,"box":{"x":45,"y":345,"width":891,"height":13}},{"id":"c7074646-3e95-414e-8635-7c7a6b83d550","block_type":"box","text":"the value of your account to at least $100,000 before the Fund make","page_number":563,"box":{"x":45,"y":360,"width":477,"height":13}},{"id":"1acc8753-77c3-49be-8e0e-84946c4e142e","block_type":"box","text":"s an involuntary redemption. This involuntary redemption","page_number":563,"box":{"x":523,"y":360,"width":405,"height":13}},{"id":"71733031-69d0-441e-9da9-d471fe2e96e9","block_type":"box","text":"will not charge any deferred sales charge, and may not apply to accounts of certain employer-sponsored retirement plans (not","page_number":563,"box":{"x":45,"y":376,"width":870,"height":13}},{"id":"01a670dc-7995-40ea-bdae-72969f23da97","block_type":"box","text":"including IRAs), qualified state tuition plan (529 Plan) accounts, and select fee-based programs at your financial intermediary.","page_number":563,"box":{"x":45,"y":391,"width":874,"height":13}},{"id":"e394d698-75a9-400a-8572-d5cca69afdc2","block_type":"box","text":"Payment of Redemption Proceeds","page_number":563,"box":{"x":45,"y":414,"width":234,"height":13}},{"id":"1973a805-909e-43d4-ba87-25bf81a7be6e","block_type":"box","text":". The Fund may suspend the right of redemption or postpone the date of payment upon","page_number":563,"box":{"x":280,"y":414,"width":607,"height":13}},{"id":"40553ea5-f97e-4e46-9dad-4a06e0a3abf7","block_type":"box","text":"redemption for such periods as are permitted under the Investment Company Act, and may redeem shares involuntarily or make","page_number":563,"box":{"x":45,"y":429,"width":891,"height":13}},{"id":"41ab300b-ddf7-48af-9c46-91eb150974e4","block_type":"box","text":"payment for redemption in securities or other property when d","page_number":563,"box":{"x":45,"y":445,"width":435,"height":13}},{"id":"3ba13276-ae29-4bb3-ba50-e470b14aec25","block_type":"box","text":"etermined appropriate in light of the Fund’s responsibilities under","page_number":563,"box":{"x":481,"y":445,"width":455,"height":13}},{"id":"0f0eaad9-5c47-4d8d-b4f0-4a9ae6a9b397","block_type":"box","text":"the Investment Company Act.","page_number":563,"box":{"x":45,"y":460,"width":207,"height":13}},{"id":"45a3fcb3-46ba-4193-b9d9-eae15b7bba74","block_type":"box","text":"The Fund reserves the right, if conditions exist which make cash p","page_number":563,"box":{"x":45,"y":483,"width":458,"height":13}},{"id":"7afd2417-1214-4443-b26a-c541f3df4f17","block_type":"box","text":"ayments undesirable, to honor any request for redemption or","page_number":563,"box":{"x":504,"y":483,"width":423,"height":13}},{"id":"c70e8a02-b77b-4217-91b1-f116a68a48ea","block_type":"box","text":"repurchase of the Fund’s shares by making payment in whole or in part in securities chosen by the Fund and valued in the same","page_number":563,"box":{"x":45,"y":499,"width":884,"height":12}},{"id":"dfdcac7d-5519-4444-af14-8a8084ae779c","block_type":"box","text":"way as they would be valued for purposes of computing the Fund’s NAV. 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The Fund has elected, however, to be governed by Rule 18f-1 under","page_number":563,"box":{"x":45,"y":530,"width":906,"height":12}},{"id":"01092b96-37b8-4244-bc1a-f028aa132c8d","block_type":"box","text":"the Investment Company Act so that the Fund is obligated to redeem its shares solely in cash up to the lesser of $250,000 or 1%","page_number":563,"box":{"x":45,"y":545,"width":890,"height":13}},{"id":"ca4a9b80-0d94-4b4d-b334-d4b998de369d","block_type":"box","text":"of its NAV during any 90-day period for any one shareholder of the Fund.","page_number":563,"box":{"x":46,"y":561,"width":515,"height":12}},{"id":"5a09e2ea-2026-4dc0-b39e-390bcf967fab","block_type":"box","text":"Under the Investment Company Act, the Fund may suspend the right to redemption or postpone the date of payment upon","page_number":563,"box":{"x":45,"y":583,"width":853,"height":13}},{"id":"f01e51f3-4de6-4915-92b4-ce5b980d914b","block_type":"box","text":"redemption for any period during which the NYSE is closed (oth","page_number":563,"box":{"x":45,"y":599,"width":449,"height":13}},{"id":"fd986d60-b5fa-4b4b-8b99-02544e1e3fd8","block_type":"box","text":"er than customary weekend and holiday closings), or during","page_number":563,"box":{"x":495,"y":599,"width":416,"height":13}},{"id":"86d48396-d01d-4c25-8fa8-e1b23f61e0c9","block_type":"box","text":"which trading on the NYSE is restricted, or during which (as determined by the SEC by rule or regulation) an emergency exists as","page_number":563,"box":{"x":45,"y":614,"width":898,"height":13}},{"id":"047f01ba-6cec-4b11-bc3b-287c9df1dc65","block_type":"box","text":"a result of which disposal or valuation or portfolio securities is not reasonably practicable, or for such other periods as the SEC","page_number":563,"box":{"x":46,"y":630,"width":880,"height":13}},{"id":"2dfed086-4d60-41ff-8eb8-07c871119dd4","block_type":"box","text":"may permit. 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The Fund reserves the express right to redeem shares of the Fund involuntarily at any time if the Board of","page_number":563,"box":{"x":46,"y":715,"width":904,"height":12}},{"id":"9ec890d1-cc01-451f-b8b8-ebefb6b33fef","block_type":"box","text":"Trustees determines, in its sole discretion, that failure to do so ma","page_number":563,"box":{"x":45,"y":730,"width":455,"height":12}},{"id":"c49f18ee-cb39-4676-86c6-69504d0d6cfd","block_type":"box","text":"y have adverse consequences to the holders of shares in the Fund.","page_number":563,"box":{"x":501,"y":730,"width":452,"height":13}},{"id":"c6739326-3384-4035-b095-a3289d869cb4","block_type":"box","text":"Upon such redemption the holders of shares so redeemed shal","page_number":563,"box":{"x":45,"y":746,"width":428,"height":12}},{"id":"856c9f1a-bb43-48d1-9795-66a72bbfb0b7","block_type":"box","text":"l have no further right with respect thereto other than to receive","page_number":563,"box":{"x":474,"y":746,"width":442,"height":12}},{"id":"47702729-087e-4710-b0ba-7e43c600fb8c","block_type":"box","text":"payment of the redemption price.","page_number":563,"box":{"x":45,"y":761,"width":231,"height":13}},{"id":"14f89cec-e704-416d-8bdc-ce56ee98fe6a","block_type":"box","text":"Signature Guarantee","page_number":563,"box":{"x":46,"y":784,"width":141,"height":13}},{"id":"8360bc5b-ebb5-4729-8523-bbf1ab5a9e63","block_type":"box","text":". A signature guarantee is designed to protect the shareholders and the Fund against fraudulent transactions","page_number":563,"box":{"x":189,"y":784,"width":744,"height":13}},{"id":"a9c29362-07db-427f-9406-03869d32116b","block_type":"box","text":"by unauthorized persons. A signature guarantee may be obtai","page_number":563,"box":{"x":46,"y":799,"width":426,"height":13}},{"id":"3529e5d9-2b38-4729-a3cc-4d53aaa9cd0c","block_type":"box","text":"ned from a domestic bank or trust company, recognized broker,","page_number":563,"box":{"x":472,"y":799,"width":444,"height":13}},{"id":"65923c42-f8ee-4d66-b843-45163539c730","block_type":"box","text":"dealer, clearing agency, savings association who are participants in a medallion program by the Securities Transfer Association,","page_number":563,"box":{"x":46,"y":815,"width":881,"height":13}},{"id":"c6c02650-d8f0-43e2-9793-5fd915673df2","block_type":"box","text":"credit unions, national securities exchanges and registered secur","page_number":563,"box":{"x":45,"y":830,"width":441,"height":13}},{"id":"e27cde9b-d519-4147-be6d-5e1183f80604","block_type":"box","text":"ities associations. The three recognized medallion programs are","page_number":563,"box":{"x":486,"y":830,"width":439,"height":13}},{"id":"3f797bd4-6e19-4d3d-9790-a32defd14eb7","block_type":"box","text":"Securities Transfer Agent Medallion Program (STAMP), Stock Exchanges Medallion Program (SEMP) and New York Stock","page_number":563,"box":{"x":46,"y":846,"width":862,"height":13}},{"id":"34160748-725a-49b0-9d01-d5ad7aab7bd8","block_type":"box","text":"Exchange, Inc. Medallion Signature Program (MSP). Signature Guarantees which are not a part of these programs will not be","page_number":563,"box":{"x":45,"y":861,"width":871,"height":13}},{"id":"aed6ce15-b881-4307-95b5-9b10207319d7","block_type":"box","text":"accepted. Please note that a notary public stamp or seal is not acceptable.","page_number":563,"box":{"x":46,"y":877,"width":506,"height":13}},{"id":"ec80c7dd-06e1-4f5c-9b42-9945aed4cb7e","block_type":"box","text":"II-53","page_number":563,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"7a5d728a-e5da-4d72-9189-87f1c30ad640","block_type":"box","text":"NM1026U-6004382-563/605","page_number":563,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4b59adc2-2de1-4b75-9311-59b70c702667","block_type":"box","text":"D","page_number":564,"box":{"x":355,"y":80,"width":12,"height":9}},{"id":"3598f573-a041-45e9-8df9-f70afe0996a1","block_type":"box","text":"ETERMINATION OF","page_number":564,"box":{"x":368,"y":82,"width":136,"height":7}},{"id":"21a1d103-5b99-4756-b7ca-2fe91676d448","block_type":"box","text":"N","page_number":564,"box":{"x":510,"y":80,"width":13,"height":9}},{"id":"9ce84fdd-65cd-4c1a-9993-70372515bb99","block_type":"box","text":"ET","page_number":564,"box":{"x":524,"y":82,"width":17,"height":7}},{"id":"badb4a96-c2ff-4567-970d-2174f408fb86","block_type":"box","text":"A","page_number":564,"box":{"x":546,"y":79,"width":12,"height":10}},{"id":"d078c423-4451-4ebc-852e-c64b8d2076f7","block_type":"box","text":"SSET","page_number":564,"box":{"x":559,"y":82,"width":31,"height":7}},{"id":"26365890-91d9-4999-a251-69e8a1eecb2c","block_type":"box","text":"V","page_number":564,"box":{"x":595,"y":80,"width":12,"height":9}},{"id":"cf653b3c-6614-4a0a-a51c-7d66bcf8b38f","block_type":"box","text":"ALUE","page_number":564,"box":{"x":607,"y":82,"width":37,"height":7}},{"id":"b3a70b2b-4164-4d9a-8535-4ba464873b43","block_type":"box","text":"Each Fund seeks to maintain a NAV of $1.00 per share for purposes of purchase and redemptions and values its portfolio","page_number":564,"box":{"x":45,"y":104,"width":846,"height":13}},{"id":"b3e94b03-a1ff-4fd6-bc90-1fbb0629dbd2","block_type":"box","text":"securities on the basis of the amortized cost method of valuation.","page_number":564,"box":{"x":46,"y":120,"width":449,"height":10}},{"id":"d9b052dc-76a6-49c7-8765-1169ce7a6b8c","block_type":"box","text":"Under this method portfolio securities are valued at cost when purchased and thereafter, a constant proportionate accretion of any","page_number":564,"box":{"x":45,"y":142,"width":906,"height":13}},{"id":"d1e906c1-5e9b-4c02-8fa2-140a3cc30589","block_type":"box","text":"discount or amortization of premium is recorded until the maturity of the security. The effect of changes in the market value of a","page_number":564,"box":{"x":46,"y":158,"width":892,"height":13}},{"id":"ce315706-3873-469c-bae3-f49915bff564","block_type":"box","text":"security as a result of fluctuating interest rates is not taken into account.","page_number":564,"box":{"x":46,"y":173,"width":497,"height":13}},{"id":"cc070dfc-7464-459a-bcc7-e598c886e994","block_type":"box","text":"As indicated, the amortized cost method of valuation may result in the value of a security being higher or lower than its market","page_number":564,"box":{"x":45,"y":196,"width":882,"height":13}},{"id":"9ceceaf6-10e0-4ec0-b9f5-b0e3b37c2630","block_type":"box","text":"price, the price a Fund would receive if the security were sold prior to maturity. Each Fund’s Board has established procedures for","page_number":564,"box":{"x":45,"y":212,"width":900,"height":13}},{"id":"6b0b9227-f07f-4072-bd20-a1516e096679","block_type":"box","text":"the purpose of maintaining a constant NAV of $1.00 per share for each Fund; however, there can be no assurance that a constant","page_number":564,"box":{"x":45,"y":227,"width":901,"height":13}},{"id":"7a5ad326-1ebe-4be6-af6c-249cc85424d6","block_type":"box","text":"NAV will be maintained for any Fund. Such procedures include a review of the extent of any deviation of NAV per share, based","page_number":564,"box":{"x":45,"y":243,"width":890,"height":13}},{"id":"21675a00-e5c7-4457-94b2-9a94ef36d4e4","block_type":"box","text":"on available market quotations, from the $1.00 amortized cost per share.","page_number":564,"box":{"x":46,"y":258,"width":507,"height":13}},{"id":"adc0e150-95c8-451b-9a5f-bb7daab8e155","block_type":"box","text":"Should that deviation exceed","page_number":564,"box":{"x":46,"y":281,"width":199,"height":10}},{"id":"6e05cabd-508b-4dc8-bd5d-bf8ab08d9d83","block_type":"box","text":"1⁄","page_number":564,"box":{"x":253,"y":282,"width":4,"height":6}},{"id":"a762014e-87e0-4197-8b08-dfc28e5d43b8","block_type":"box","text":"1⁄2","page_number":564,"box":{"x":255,"y":282,"width":9,"height":9}},{"id":"eb883bbb-64c2-4d70-8cfa-799312d2a3be","block_type":"box","text":"⁄2","page_number":564,"box":{"x":262,"y":285,"width":6,"height":6}},{"id":"e93da496-f914-4b62-92ed-fe3dc42c01d3","block_type":"box","text":"of 1% for a Fund, the Fund’s Board will promptly consider whether any action should be","page_number":564,"box":{"x":274,"y":281,"width":620,"height":13}},{"id":"717b7e53-40fb-48b5-98a9-10e286793823","block_type":"box","text":"initiated to eliminate or reduce material dilution or other adv","page_number":564,"box":{"x":45,"y":297,"width":424,"height":10}},{"id":"848a1085-d5da-4328-93df-893f03e5546e","block_type":"box","text":"erse impact to shareholders. 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This yield calculation does not take into","page_number":564,"box":{"x":45,"y":522,"width":903,"height":13}},{"id":"70bcd306-b177-4c8b-958f-cf34dc92d0a7","block_type":"box","text":"consideration any realized or unrealized gains or losses on portfo","page_number":564,"box":{"x":45,"y":538,"width":450,"height":12}},{"id":"8a1ac96f-0a75-4d5f-9c48-5bf6aaddf51c","block_type":"box","text":"lio securities. The Commission also permits the calculation of a","page_number":564,"box":{"x":496,"y":538,"width":438,"height":12}},{"id":"7c7ba83a-2cd1-46fb-b8e6-e5ea26fb90c5","block_type":"box","text":"standardized effective or compounded yield. This is computed","page_number":564,"box":{"x":46,"y":553,"width":429,"height":13}},{"id":"829f5045-082b-4771-a8b4-a5ddbf0aa439","block_type":"box","text":"by compounding the unannualized base period return, which is","page_number":564,"box":{"x":480,"y":553,"width":438,"height":13}},{"id":"d1b0fb7a-8a38-4f73-8b92-a635ec5bac59","block_type":"box","text":"done by adding one to the base period return, raising the sum to a pow","page_number":564,"box":{"x":46,"y":569,"width":492,"height":12}},{"id":"64a34dbd-7a76-45d8-b292-0a0bc69b08a1","block_type":"box","text":"er equal to 365 divided by seven, and subtracting one from","page_number":564,"box":{"x":539,"y":569,"width":409,"height":12}},{"id":"3ded721f-e354-4966-8672-8ba509bfa8bb","block_type":"box","text":"the result. This compounded yield calculation also excludes realized and unrealized gains or losses on portfolio securities.","page_number":564,"box":{"x":45,"y":584,"width":839,"height":13}},{"id":"e6a503ef-14f7-4b75-b8c3-c67aa7831161","block_type":"box","text":"The yield on each Fund’s shares normally will fluctuate on a daily basis. Therefore, the yield for any given past period is not an","page_number":564,"box":{"x":45,"y":607,"width":881,"height":13}},{"id":"b22963e1-1462-400b-a4e4-56a5ac9f6c6d","block_type":"box","text":"indication or representation by a Fund of future yields or rates of return on its shares. The yield is affected by such factors as","page_number":564,"box":{"x":45,"y":622,"width":863,"height":13}},{"id":"706433a8-6e8f-4344-a336-9c05bb482e51","block_type":"box","text":"changes in interest rates on a Fund’s portfolio securities, average portfolio maturity, the types and quality of portfolio securities","page_number":564,"box":{"x":45,"y":638,"width":882,"height":13}},{"id":"c53f8d50-baab-468d-8b2e-cd6fe971a46d","block_type":"box","text":"held and operating expenses. The yield on Fund shares for various reasons may not be comparable to the yield on bank deposits,","page_number":564,"box":{"x":45,"y":653,"width":893,"height":13}},{"id":"f3c638fe-7c09-4591-ba12-cd618ca7291c","block_type":"box","text":"shares of other money market funds or other investments.","page_number":564,"box":{"x":46,"y":669,"width":400,"height":13}},{"id":"3d418a24-46eb-4b65-8442-18a87920ddad","block_type":"box","text":"See “Yield Information” in Part I of each Fund’s SAI for recent seven-day yield information relating to your Fund.","page_number":564,"box":{"x":46,"y":692,"width":789,"height":13}},{"id":"92959db8-5b84-4bb1-9b84-0c36af8df0ae","block_type":"box","text":"On occasion, each Fund may compare its yield to (1) an industry average compiled by Donoghue’s Money Fund Report, a widely","page_number":564,"box":{"x":46,"y":715,"width":898,"height":12}},{"id":"486f3b17-41dc-44f8-8cb4-e6e2e51b7f51","block_type":"box","text":"recognized independent publication that monitors the performanc","page_number":564,"box":{"x":45,"y":730,"width":457,"height":13}},{"id":"fff65b31-1a26-424e-99e0-873e8876cc39","block_type":"box","text":"e of money market mutual funds, (2) the average yield reported","page_number":564,"box":{"x":503,"y":730,"width":439,"height":13}},{"id":"37144ade-66be-4d4e-b65a-07d7ec1e247c","block_type":"box","text":"by the Bank Rate Monitor National Index","page_number":564,"box":{"x":46,"y":746,"width":293,"height":13}},{"id":"56572db4-c75c-482e-8398-638e954200b7","block_type":"box","text":"TM","page_number":564,"box":{"x":339,"y":746,"width":18,"height":6}},{"id":"7520cd42-bc7d-4013-ba1a-1dc285b0eaa3","block_type":"box","text":"for money market deposit accounts offered by the 100 leading banks and thrift","page_number":564,"box":{"x":361,"y":746,"width":548,"height":13}},{"id":"5b0edc0a-e503-43d5-97f0-738ee29823f5","block_type":"box","text":"institutions in the ten largest standard metropolitan statistical areas, (3) yield data published by industry publications, including","page_number":564,"box":{"x":45,"y":761,"width":884,"height":13}},{"id":"57c8a535-fb5f-41ca-b9a9-b3356c3a636a","block_type":"box","text":"Lipper Inc., Morningstar, Inc.,","page_number":564,"box":{"x":46,"y":777,"width":210,"height":13}},{"id":"6fd27862-e34f-4ce1-a3fb-f3ae0ca89dba","block_type":"box","text":"Money Magazine, U.S. News & World Report, BusinessWeek, CDA Investment Technology, Inc.,","page_number":564,"box":{"x":261,"y":777,"width":686,"height":13}},{"id":"9bc617a4-f235-425a-aa54-05417845834b","block_type":"box","text":"Forbes Magazine","page_number":564,"box":{"x":45,"y":792,"width":118,"height":13}},{"id":"ad7d1efe-4dfc-4e5b-9d80-8efd79be9d23","block_type":"box","text":"and","page_number":564,"box":{"x":169,"y":792,"width":25,"height":10}},{"id":"4306f515-b28b-489f-af2c-9b5c3bd6c5a1","block_type":"box","text":"Fortune Magazine","page_number":564,"box":{"x":199,"y":793,"width":126,"height":12}},{"id":"5f50f7f6-8d7c-48ac-8332-6a934976e3eb","block_type":"box","text":", or (4) the yield on an investment in 90-day Treasury bills on a rolling basis, assuming","page_number":564,"box":{"x":326,"y":792,"width":599,"height":13}},{"id":"129bad1c-5b7c-4179-ab50-77042d1cd08d","block_type":"box","text":"quarterly compounding. As with yield quotations, yield compar","page_number":564,"box":{"x":46,"y":808,"width":441,"height":13}},{"id":"49a47077-ccc8-4ac5-a762-3aef2808a6c9","block_type":"box","text":"isons should not be considered indicative of a Fund’s yield or","page_number":564,"box":{"x":488,"y":808,"width":422,"height":13}},{"id":"e89982a7-513c-42cd-a3cc-af550e9aaae9","block_type":"box","text":"relative performance for any future period.","page_number":564,"box":{"x":45,"y":823,"width":296,"height":13}},{"id":"19b28eb8-3ca7-4a53-870d-9837302ecf7f","block_type":"box","text":"A Fund may provide information designed to help investor","page_number":564,"box":{"x":45,"y":846,"width":408,"height":13}},{"id":"f5165c38-d20f-42e7-a663-2ae0117d7937","block_type":"box","text":"s understand how the Fund is seeking to achieve its investment","page_number":564,"box":{"x":454,"y":846,"width":434,"height":13}},{"id":"fef3294f-9cc2-46af-95c0-e37809527e12","block_type":"box","text":"objective. 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The Manager does not execute transactions through any particular broker or dealer, but seeks to obtain the","page_number":565,"box":{"x":45,"y":202,"width":906,"height":13}},{"id":"d0a10aab-f362-43b4-8125-68607780b400","block_type":"box","text":"best net results for the Fund, taking into account such factors a","page_number":565,"box":{"x":46,"y":218,"width":436,"height":12}},{"id":"70e4d1c6-00d8-4b42-9d11-79c294c9533e","block_type":"box","text":"s price (including the applicable dealer spread), size of order,","page_number":565,"box":{"x":483,"y":218,"width":419,"height":12}},{"id":"93e83777-bd20-4326-a0dd-30dce0840449","block_type":"box","text":"difficulty of execution, operational facilities of the firm and the firm’s risk and skill in positioning blocks of securities. While the","page_number":565,"box":{"x":46,"y":233,"width":885,"height":13}},{"id":"f9d96238-3db3-43ca-bf7b-eeefd741961c","block_type":"box","text":"Manager generally seeks reasonable trade execution costs, a Fund does not necessarily pay the lowest spread or commission","page_number":565,"box":{"x":45,"y":249,"width":859,"height":12}},{"id":"18e66474-2c2f-4964-b895-7c237358de35","block_type":"box","text":"available. Each Fund’s policy of investing in securities with short maturities will result in high portfolio turnover.","page_number":565,"box":{"x":46,"y":264,"width":781,"height":13}},{"id":"3945db6b-ce25-459b-82a4-021397a34eae","block_type":"box","text":"Subject to obtaining the best net results, dealers who provide supplemental investment research (such as economic data and","page_number":565,"box":{"x":46,"y":289,"width":854,"height":13}},{"id":"8ff4546c-e398-4698-a2e9-958f63708a9d","block_type":"box","text":"market forecasts) to the Manager may receive orders for transac","page_number":565,"box":{"x":45,"y":304,"width":445,"height":13}},{"id":"8d36e4e7-d772-4897-b9e7-24a113e7afce","block_type":"box","text":"tions of the Fund. Information received will be in addition to and","page_number":565,"box":{"x":491,"y":304,"width":452,"height":10}},{"id":"2175e5aa-a1ba-489c-a421-a9c9083def4b","block_type":"box","text":"not in lieu of the services required to be performed by the Manager under each Management Agreement and the expenses of the","page_number":565,"box":{"x":45,"y":320,"width":888,"height":13}},{"id":"728cd3f8-bd3d-453d-b9e5-421923d9ff86","block_type":"box","text":"Manager will not necessarily be reduced as a result of the receipt of such supplemental information.","page_number":565,"box":{"x":45,"y":335,"width":690,"height":13}},{"id":"93dede5c-f110-4b7b-ac8f-191983df2e25","block_type":"box","text":"The portfolio securities in which each Fund invests are traded pr","page_number":565,"box":{"x":45,"y":360,"width":446,"height":13}},{"id":"df5c0fab-f518-4506-aef2-9aceb5b3c72e","block_type":"box","text":"imarily in the OTC market. Bonds and debentures usually are","page_number":565,"box":{"x":492,"y":360,"width":428,"height":13}},{"id":"09050e3c-8f5d-4278-ba01-803a99df6456","block_type":"box","text":"traded OTC, but may be traded on an exchange. Where possible, a Fund will deal directly with the dealers who make a market in","page_number":565,"box":{"x":45,"y":375,"width":901,"height":13}},{"id":"a9190b6d-5cae-4647-a1e4-e992222dc50d","block_type":"box","text":"the securities involved except in those circumstances where be","page_number":565,"box":{"x":45,"y":391,"width":429,"height":13}},{"id":"3f278f61-daa6-46ff-9e78-384929af4e84","block_type":"box","text":"tter prices and execution are available elsewhere. Such dealers","page_number":565,"box":{"x":474,"y":391,"width":428,"height":13}},{"id":"bf25c150-a9ba-4c79-9ac4-ca916fc3361a","block_type":"box","text":"usually are acting as principals for their own accounts. On occasion, securities may be purchased directly from the issuer. Money","page_number":565,"box":{"x":46,"y":406,"width":894,"height":13}},{"id":"11c4e5c9-b4a9-4d2a-8974-ff83c3358899","block_type":"box","text":"market securities are generally traded on a net basis and do not normally involve either brokerage commissions or transfer taxes.","page_number":565,"box":{"x":45,"y":422,"width":892,"height":13}},{"id":"3d55de0f-36d3-4cb1-bafc-42435cbf2380","block_type":"box","text":"The cost of executing portfolio securities transactions of a Fund primarily will consist of dealer spreads. Under the Investment","page_number":565,"box":{"x":45,"y":437,"width":872,"height":13}},{"id":"34277a89-e7e7-4af6-b816-a76230f279bd","block_type":"box","text":"Company Act, persons affiliated with a Fund and persons who are affiliated with such affiliated persons are prohibited from","page_number":565,"box":{"x":46,"y":453,"width":863,"height":13}},{"id":"181629d1-90ca-4efa-b58e-12bf3a358739","block_type":"box","text":"dealing with the Fund as principals in the purchase and sale of secu","page_number":565,"box":{"x":46,"y":468,"width":465,"height":13}},{"id":"4a07d701-2173-4f25-a200-633bb9d235cc","block_type":"box","text":"rities unless an exemptive order allowing such transactions is","page_number":565,"box":{"x":512,"y":468,"width":421,"height":13}},{"id":"3c76f178-5787-4cf6-96ca-2f8abf893978","block_type":"box","text":"obtained from the Commission. Since transactions in the OTC market usually involve transactions with the dealers acting as","page_number":565,"box":{"x":46,"y":484,"width":863,"height":13}},{"id":"138e3e67-838d-4cdc-a24b-8565d9b7e7e4","block_type":"box","text":"principals for their own accounts, the Funds will not deal with affiliated persons in connection with such transactions, except","page_number":565,"box":{"x":45,"y":499,"width":868,"height":13}},{"id":"46ebc477-8b31-4797-9c15-58df0d0c58bf","block_type":"box","text":"pursuant to an applicable exemptive order or as otherwise p","page_number":565,"box":{"x":45,"y":515,"width":417,"height":13}},{"id":"3c6156ea-7b90-4117-8eba-5d4c71ec59ec","block_type":"box","text":"ermitted by applicable law. However, an affiliated person of a Fund","page_number":565,"box":{"x":463,"y":515,"width":471,"height":13}},{"id":"f837a1b2-342f-4011-aaab-1904a673ae96","block_type":"box","text":"may serve as its broker in OTC transactions conducted on an agency basis.","page_number":565,"box":{"x":45,"y":530,"width":520,"height":13}},{"id":"4dee456e-25d3-4889-a5cb-dcaf4e5c83a0","block_type":"box","text":"The Manager does not consider sales of shares of the mutual funds it advises as a factor in the selection of brokers or dealers to","page_number":565,"box":{"x":45,"y":555,"width":883,"height":13}},{"id":"12e1af3b-9257-4874-8f22-97e81bc65f8b","block_type":"box","text":"execute portfolio transactions for a Fund; however, whether or not a particular broker or dealer sells shares of the mutual funds","page_number":565,"box":{"x":46,"y":571,"width":886,"height":12}},{"id":"c48459cf-fb6a-4b09-96f8-ca9880ad08d5","block_type":"box","text":"advised by the Manager neither qualifies nor disqualifies such broker or dealer to execute transactions for those mutual funds.","page_number":565,"box":{"x":46,"y":586,"width":873,"height":13}},{"id":"f1c1b08e-d535-406d-9132-7a5de8ef59ff","block_type":"box","text":"OTC issues, including most fixed income securities such as corporate debt and U.S. Government securities, are normally traded on","page_number":565,"box":{"x":46,"y":611,"width":904,"height":12}},{"id":"def1b0b2-df3c-40c8-9587-116822acd24f","block_type":"box","text":"a “net” basis without a stated commission, through dealers acting for their own account and not as brokers. The Funds will","page_number":565,"box":{"x":46,"y":626,"width":859,"height":13}},{"id":"1e97b77e-0b62-4c09-88f4-f75b62a31764","block_type":"box","text":"primarily engage in transactions with these dealers or deal directly with the issuer unless a better price or execution could be","page_number":565,"box":{"x":45,"y":642,"width":860,"height":13}},{"id":"f5a3b6ec-6252-45da-ae0e-84bad39057bb","block_type":"box","text":"obtained by using a broker. Prices paid to a dealer with respect to both non-U.S. and domestic securities will generally include a","page_number":565,"box":{"x":46,"y":657,"width":885,"height":13}},{"id":"e4b6caa4-e0c9-46ad-8f6e-dda804ef163f","block_type":"box","text":"“spread,” which is the difference between the prices at which the","page_number":565,"box":{"x":47,"y":673,"width":448,"height":13}},{"id":"7c0dd853-488c-4980-be3a-a45d865fce9f","block_type":"box","text":"dealer is willing to purchase and sell the specific security at the","page_number":565,"box":{"x":501,"y":673,"width":432,"height":13}},{"id":"b64b0e14-4fa2-48e5-820f-596e401bcd6a","block_type":"box","text":"time, and includes the dealer’s normal profit.","page_number":565,"box":{"x":45,"y":688,"width":311,"height":13}},{"id":"361381ce-e493-439e-9aab-a2f38316deaa","block_type":"box","text":"Purchases of money market instruments by a Fund are made from dealers, underwriters and issuers. The Funds do not currently","page_number":565,"box":{"x":45,"y":713,"width":888,"height":13}},{"id":"1b888f33-9fd1-4b5f-a6d1-db4c684537c0","block_type":"box","text":"expect to incur any brokerage commission expense on such transactions because money market instruments are generally traded","page_number":565,"box":{"x":46,"y":728,"width":890,"height":13}},{"id":"7e1ca40a-fb14-4dbd-b7f4-90f16309bd70","block_type":"box","text":"on a “net” basis with dealers acting as principal for their own accounts without a stated commission. The price of the security,","page_number":565,"box":{"x":46,"y":744,"width":877,"height":13}},{"id":"4f4a094d-410c-4b54-832a-7fe55e994aad","block_type":"box","text":"however, usually includes a profit to the dealer. Each money market Fund (each a “Money Market Fund”) intends to purchase","page_number":565,"box":{"x":45,"y":759,"width":881,"height":13}},{"id":"6d692179-25b7-45bd-99d2-3443ce00962c","block_type":"box","text":"only securities with remaining maturities of 397 days or less as determined in accordance with the rules of the Commission. As a","page_number":565,"box":{"x":46,"y":775,"width":890,"height":13}},{"id":"63abd9fa-8a7b-4018-8d75-e8ec543336a4","block_type":"box","text":"result, the portfolio turnover rates of a Money Market Fund will be relatively high. However, because brokerage commissions will","page_number":565,"box":{"x":45,"y":790,"width":905,"height":13}},{"id":"9035f004-c207-4749-90b4-57058f1785c1","block_type":"box","text":"not normally be paid with respect to investments made by a Money Market Fund, the turnover rates should not adversely affect","page_number":565,"box":{"x":45,"y":806,"width":889,"height":13}},{"id":"1e2f5a40-a79e-4b2e-a69f-24ccfd7ada83","block_type":"box","text":"the Fund’s NAVs or net income.","page_number":565,"box":{"x":45,"y":821,"width":224,"height":10}},{"id":"9897ffb7-561d-4860-ac17-ea5cd6b11dac","block_type":"box","text":"Securities purchased in underwritten offerings include a fixed","page_number":565,"box":{"x":46,"y":846,"width":423,"height":13}},{"id":"2225c587-a869-4f42-ab70-04160d80565a","block_type":"box","text":"amount of compensation to the underwriter, generally referred to as","page_number":565,"box":{"x":474,"y":846,"width":472,"height":13}},{"id":"cca0276f-f58c-4f81-ba68-a2f5fcfaded5","block_type":"box","text":"the underwriter’s concession or discount. When offered securities are purchased or sold directly from or to an issuer, no","page_number":565,"box":{"x":45,"y":861,"width":830,"height":13}},{"id":"0e31cdc6-5961-402e-9bf7-1edf9fcafc10","block_type":"box","text":"commissions or discounts are paid except where required by local markets.","page_number":565,"box":{"x":45,"y":877,"width":520,"height":13}},{"id":"bb95db05-7cf3-41ff-a068-6b66215f6804","block_type":"box","text":"II-55","page_number":565,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"c1632752-b48d-41f4-bea8-6aaa396aab8e","block_type":"box","text":"NM1026U-6004382-565/605","page_number":565,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ff44e49d-a225-4052-8f6e-61e01945e555","block_type":"box","text":"The Manager or sub-advisers may seek to obtain an undertaking from issuers of commercial paper or dealers selling commercial","page_number":566,"box":{"x":45,"y":79,"width":891,"height":13}},{"id":"9c34dd9b-db78-42a9-a0b0-0e80efc054b2","block_type":"box","text":"paper to consider the repurchase of such securities from a Fund pr","page_number":566,"box":{"x":45,"y":94,"width":459,"height":13}},{"id":"265df4eb-1b59-4d64-a7f6-c1ae60cd17e9","block_type":"box","text":"ior to maturity at their original cost plus interest (sometimes","page_number":566,"box":{"x":505,"y":94,"width":416,"height":13}},{"id":"de7aba57-aa2e-4c22-97e9-c45648b81afb","block_type":"box","text":"adjusted to reflect the actual maturity of the securities), if it belie","page_number":566,"box":{"x":46,"y":110,"width":446,"height":13}},{"id":"4d055d7e-817d-47a2-bfdc-91121f157c87","block_type":"box","text":"ves that a Fund’s anticipated need for liquidity makes such action","page_number":566,"box":{"x":492,"y":110,"width":454,"height":13}},{"id":"4da50605-b634-4c47-bee5-199a12ae7b84","block_type":"box","text":"desirable. Any such repurchase prior to maturity reduces the possibility that a Fund would incur a capital loss in liquidating","page_number":566,"box":{"x":46,"y":125,"width":857,"height":13}},{"id":"d70b914c-46a1-4e6f-a9cd-40f2120fa5bd","block_type":"box","text":"commercial paper, especially if interest rates have risen since acquisition of such commercial paper.","page_number":566,"box":{"x":45,"y":141,"width":685,"height":13}},{"id":"35cb4635-a917-48e1-b2b7-4486805550eb","block_type":"box","text":"Investment decisions for each Fund and for other investme","page_number":566,"box":{"x":45,"y":164,"width":405,"height":10}},{"id":"21aac5a9-faf7-400e-9dda-9e36555754fa","block_type":"box","text":"nt accounts managed by the Manager or sub-advisers are made","page_number":566,"box":{"x":451,"y":164,"width":438,"height":13}},{"id":"461e31a1-269a-46fe-bae5-d18d42631fc4","block_type":"box","text":"independently of each other in light of differing conditions. Black","page_number":566,"box":{"x":45,"y":180,"width":452,"height":12}},{"id":"187ad4dc-d747-492a-847c-d7de63fdc947","block_type":"box","text":"Rock allocates investments among client accounts in a fair and","page_number":566,"box":{"x":498,"y":180,"width":435,"height":12}},{"id":"9ed3c27a-eea7-47fd-945f-84dc9f89e6c9","block_type":"box","text":"equitable manner. A variety of factors will be considered in making such allocations. These factors include: (i) investment","page_number":566,"box":{"x":46,"y":195,"width":840,"height":13}},{"id":"ea9bf112-4062-44df-86a9-3ee77ce1ef39","block_type":"box","text":"objectives or strategies for particular accounts, including sector, industry, country or region and capitalization weightings, (ii) tax","page_number":566,"box":{"x":46,"y":211,"width":895,"height":12}},{"id":"120a6c13-1f9b-40c8-ba75-d70d83aed30a","block_type":"box","text":"considerations of an account, (iii) risk or investment concentration parameters for an account, (iv) supply or demand for a security","page_number":566,"box":{"x":45,"y":226,"width":906,"height":13}},{"id":"60895229-aa23-405e-bccd-c1956160975b","block_type":"box","text":"at a given price level, (v) size of available investment, (vi) cash availability and liquidity requirements for accounts, (vii) regulatory","page_number":566,"box":{"x":46,"y":242,"width":899,"height":12}},{"id":"ec9ffe85-7305-4759-9558-6c0390c3795f","block_type":"box","text":"restrictions, (viii) minimum investment size of an account, (ix","page_number":566,"box":{"x":45,"y":257,"width":425,"height":12}},{"id":"38427a17-4f55-4aaa-850a-cf3a528e0b0e","block_type":"box","text":") relative size of account, and (x) such other factors as may be","page_number":566,"box":{"x":471,"y":257,"width":427,"height":13}},{"id":"a93e3ca6-9543-4dbf-b758-b4da3556660b","block_type":"box","text":"approved by BlackRock’s general counsel. Moreover, investments may not be allocated to one client account over another based","page_number":566,"box":{"x":46,"y":273,"width":891,"height":12}},{"id":"0a50e6fb-adb3-4f38-911f-c637bbbe55eb","block_type":"box","text":"on any of the following considerations: (i) to favor one client account at the expense of another, (ii) to generate higher fees paid by","page_number":566,"box":{"x":46,"y":288,"width":904,"height":13}},{"id":"96d02d53-7abc-41a8-a387-95bfcbdda7ff","block_type":"box","text":"one client account over another or to produce greater performance compensation to BlackRock, (iii) to develop or enhance a","page_number":566,"box":{"x":46,"y":304,"width":864,"height":12}},{"id":"e45c0cec-b326-4844-9651-382884beaf49","block_type":"box","text":"relationship with a client or prospective client, (iv) to compensate a client for past services or benefits rendered to BlackRock or to","page_number":566,"box":{"x":45,"y":319,"width":902,"height":13}},{"id":"f178c74f-1916-460b-9cc8-683ad11531f8","block_type":"box","text":"induce future services or benefits to be rendered to BlackRock,","page_number":566,"box":{"x":45,"y":335,"width":433,"height":12}},{"id":"ac86bfe7-f94f-4c85-a5a4-240eb7ab99b3","block_type":"box","text":"or (v) to manage or equalize investment performance among","page_number":566,"box":{"x":484,"y":335,"width":419,"height":12}},{"id":"9c8eb57a-5a23-4e31-ac97-043b66b0b9c7","block_type":"box","text":"different client accounts.","page_number":566,"box":{"x":46,"y":350,"width":168,"height":10}},{"id":"1d286172-efaf-4d5b-b368-8a7f464e7978","block_type":"box","text":"Because of different objectives or other factors, a particular security may be bought for one or more funds or clients advised by","page_number":566,"box":{"x":46,"y":373,"width":878,"height":13}},{"id":"cced6f25-8cdb-4165-875a-1be288fc9001","block_type":"box","text":"BlackRock or its affiliates (collectively, “clients”) when one or more clients of BlackRock or its affiliates are selling the same","page_number":566,"box":{"x":46,"y":389,"width":859,"height":13}},{"id":"71d5f3a3-a851-4082-893e-5d2735af0186","block_type":"box","text":"security. If purchases or sales of securities arise for consideration at or about the same time that would involve a Fund or other","page_number":566,"box":{"x":46,"y":404,"width":877,"height":13}},{"id":"81729c8f-f272-4b26-ab95-fe7ffdc97b69","block_type":"box","text":"clients or funds for which BlackRock or an affiliate acts as investment manager, transactions in such securities will be made,","page_number":566,"box":{"x":45,"y":420,"width":860,"height":13}},{"id":"269e6d18-f5ec-4059-9fef-556f2b28e595","block_type":"box","text":"insofar as feasible, for the respective funds and clients in a manner deemed equitable to all. To the extent that transactions on","page_number":566,"box":{"x":45,"y":435,"width":869,"height":13}},{"id":"b10e9e33-f1df-4941-99b1-72b1a72269b5","block_type":"box","text":"behalf of more than one client of BlackRock or its affiliates during the same period may increase the demand for securities being","page_number":566,"box":{"x":46,"y":451,"width":888,"height":13}},{"id":"fba6af1f-7237-44ae-bbb1-13b9a421178b","block_type":"box","text":"purchased or the supply of securities being sold, there may be an adverse effect on price.","page_number":566,"box":{"x":45,"y":466,"width":609,"height":13}},{"id":"21a61436-4779-4ff5-8de3-0e126a72eb27","block_type":"box","text":"See “Portfolio Transactions” or “Portfolio Transactions and Brokerage,” as applicable, in Part I of each Fund’s SAI for","page_number":566,"box":{"x":46,"y":490,"width":825,"height":12}},{"id":"1003bffe-6eb8-46cd-bd97-952b209c494e","block_type":"box","text":"information relating to portfolio transactions engaged in by your","page_number":566,"box":{"x":45,"y":505,"width":450,"height":13}},{"id":"4d0c130d-52c9-45d1-b0a7-53d2496188c6","block_type":"box","text":"Fund for its three most recently completed fiscal years or other","page_number":566,"box":{"x":500,"y":505,"width":434,"height":13}},{"id":"7eca2a66-f3d3-4650-8b1b-1a96d3e89930","block_type":"box","text":"relevant periods.","page_number":566,"box":{"x":45,"y":521,"width":114,"height":12}},{"id":"9c0f98c6-7c97-4715-be22-199c311ace07","block_type":"box","text":"The Board of each Fund has considered the possibility of seeking to recapture for the benefit of the Fund expenses of possible","page_number":566,"box":{"x":45,"y":544,"width":869,"height":13}},{"id":"0ce00679-c6c3-438a-a063-e97e97eb9c9f","block_type":"box","text":"portfolio transactions, such as dealer spreads and underwriting commissions, by conducting portfolio transactions through","page_number":566,"box":{"x":45,"y":559,"width":852,"height":13}},{"id":"9b793d1a-33db-4bd5-b623-5145548354c6","block_type":"box","text":"affiliated entities. After considering all factors deemed relevan","page_number":566,"box":{"x":46,"y":575,"width":427,"height":13}},{"id":"7ce538d2-9a36-4c86-a87f-15408b76bfe3","block_type":"box","text":"t, the Board of each Fund made a determination not to seek such","page_number":566,"box":{"x":473,"y":575,"width":450,"height":12}},{"id":"91cd7757-0c49-4055-ac93-3517f1948a6f","block_type":"box","text":"recapture. The Board of each Fund will reconsider this matter from time to time.","page_number":566,"box":{"x":45,"y":590,"width":559,"height":13}},{"id":"c66eb746-3967-4fb3-8534-9d68e0878bd2","block_type":"box","text":"Each Fund has received an exemptive order from the Commission p","page_number":566,"box":{"x":45,"y":614,"width":471,"height":12}},{"id":"db61bd45-d3e6-433c-898d-c0f5efce45c3","block_type":"box","text":"ermitting it to lend portfolio securities to its affiliates. Pursuant","page_number":566,"box":{"x":517,"y":614,"width":435,"height":12}},{"id":"007baeac-445d-44dc-a96b-450ca3823997","block_type":"box","text":"to that order, each Fund may retain an affiliated entity of the Manager (the “lending agent”) as the securities lending agent for a","page_number":566,"box":{"x":45,"y":629,"width":889,"height":13}},{"id":"2cf9509f-8472-445e-bfd1-5caba70b044b","block_type":"box","text":"fee, including a fee based on a share of the returns on investment of cash collateral. The lending agent may, on behalf of a Fund,","page_number":566,"box":{"x":45,"y":645,"width":888,"height":12}},{"id":"fb66053a-674f-4270-9d4a-ac37eafdf482","block_type":"box","text":"invest cash collateral received by the Fund for such loans, among other things, in a private investment company managed by the","page_number":566,"box":{"x":45,"y":660,"width":887,"height":13}},{"id":"189a0863-7aed-4ee4-802b-901ee6c4f5a9","block_type":"box","text":"lending agent or in registered money market funds advised by the Manager or its affiliates. See “Portfolio Transactions” or","page_number":566,"box":{"x":45,"y":676,"width":852,"height":12}},{"id":"e1be46c8-a8d2-4555-b219-8ec40dbef418","block_type":"box","text":"“Portfolio Transactions and Brokerage,” as applicable, in Part I of each Fund’s SAI for the securities lending agent fees, if any,","page_number":566,"box":{"x":47,"y":691,"width":873,"height":13}},{"id":"07bf9739-ffb9-4ec3-ab5b-29fa67aeb297","block_type":"box","text":"paid by your Fund to the lending agent for the periods indicated.","page_number":566,"box":{"x":45,"y":707,"width":448,"height":12}},{"id":"5ef440f2-279a-473d-9039-a14d3ffd5285","block_type":"box","text":"Because of different objectives or other factors, a particular security may be bought for one or more funds or clients advised by the","page_number":566,"box":{"x":46,"y":730,"width":904,"height":13}},{"id":"1ce987f6-0f0e-4786-8861-52e632487ae3","block_type":"box","text":"Manager or its affiliates (collectively, “clients”) when one or more clients of the Manager or its affiliates are selling the same","page_number":566,"box":{"x":45,"y":745,"width":862,"height":13}},{"id":"27652d88-6364-45c6-a9e6-15e0e0920628","block_type":"box","text":"security. If purchases or sales of securities arise for consideration at or about the same time that would involve a Fund or other","page_number":566,"box":{"x":46,"y":761,"width":877,"height":13}},{"id":"3354cd41-8554-46c0-a648-6471271dd680","block_type":"box","text":"clients or funds for which the Manager or an affiliate acts as investment manager, transactions in such securities will be made,","page_number":566,"box":{"x":45,"y":776,"width":874,"height":13}},{"id":"bca259e2-9bb8-47f1-9c52-52fdf4c4f5ce","block_type":"box","text":"insofar as feasible, for the respective funds and clients in a manner deemed equitable to all. To the extent that transactions on","page_number":566,"box":{"x":45,"y":792,"width":869,"height":13}},{"id":"6056e69c-d0da-458e-840f-6b27ad9bd99c","block_type":"box","text":"behalf of more than one client of the Manager or its affiliates during the same period may increase the demand for securities being","page_number":566,"box":{"x":46,"y":807,"width":902,"height":13}},{"id":"6fd12e2f-1b47-4f99-9d25-3d4745a7ad59","block_type":"box","text":"purchased or the supply of securities being sold, there may be an adverse effect on price.","page_number":566,"box":{"x":45,"y":823,"width":609,"height":13}},{"id":"6f0d1d66-f536-4d95-802d-f5f0b0483176","block_type":"box","text":"II-56","page_number":566,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"071f0060-3f2e-4e3d-8293-3eabc1cea375","block_type":"box","text":"NM1026U-6004382-566/605","page_number":566,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b66a801d-3362-4740-81a3-696a709f5373","block_type":"box","text":"D","page_number":567,"box":{"x":415,"y":80,"width":12,"height":9}},{"id":"87739729-5f75-4e99-a152-8aca1904cb70","block_type":"box","text":"IVIDENDS AND","page_number":567,"box":{"x":428,"y":82,"width":103,"height":7}},{"id":"74996ba1-5ac7-409a-a907-e7181e7cc197","block_type":"box","text":"T","page_number":567,"box":{"x":536,"y":79,"width":12,"height":10}},{"id":"b44eec80-ff82-434c-b42e-2082f6174c6b","block_type":"box","text":"AXES","page_number":567,"box":{"x":548,"y":82,"width":35,"height":7}},{"id":"ff43c972-9555-4d01-8d9a-1c31e2ec485c","block_type":"box","text":"Dividends","page_number":567,"box":{"x":45,"y":105,"width":72,"height":11}},{"id":"41386974-8ace-4953-87ee-d3a3237b3fa2","block_type":"box","text":"Each Fund declares dividends daily. Except as otherwise provided in a Fund’s Prospectus, dividends of each Fund are reinvested","page_number":567,"box":{"x":45,"y":129,"width":886,"height":13}},{"id":"5e7b7a7d-8c69-4b76-ac2b-27eadc436086","block_type":"box","text":"monthly in additional shares of that Fund at NAV. Except as oth","page_number":567,"box":{"x":45,"y":145,"width":452,"height":13}},{"id":"e85f5704-5b2b-4ba3-8a5f-79abe6b44f21","block_type":"box","text":"erwise provided in a Fund’s Prospectus, shares purchased will","page_number":567,"box":{"x":497,"y":145,"width":427,"height":13}},{"id":"c076da60-5a53-4ca4-b230-26125eb58f73","block_type":"box","text":"begin accruing dividends on the day following the date of purcha","page_number":567,"box":{"x":46,"y":160,"width":450,"height":13}},{"id":"88937b4a-e406-42e9-a27b-3a10a05dc052","block_type":"box","text":"se. Until they are paid, dividends that are declared will remain in","page_number":567,"box":{"x":497,"y":160,"width":447,"height":13}},{"id":"7707295c-d748-4c20-b1ad-4e9cc5fd804e","block_type":"box","text":"the gross assets of each Fund and will therefore continue to earn income for the Fund’s shareholders. Shareholders will receive","page_number":567,"box":{"x":45,"y":176,"width":874,"height":13}},{"id":"292a03d9-73d5-4c25-a07a-1885fd9c8035","block_type":"box","text":"monthly statements as to such reinvestments.","page_number":567,"box":{"x":45,"y":191,"width":312,"height":13}},{"id":"2b0830a5-a3a3-4213-b8d9-e53c133de4c8","block_type":"box","text":"Net income (from the time of the immediately preceding determin","page_number":567,"box":{"x":45,"y":215,"width":457,"height":13}},{"id":"a38ed912-64c5-4c0f-a89e-cb8ed46e422e","block_type":"box","text":"ation thereof) consists of (i) interest accrued and/or discount","page_number":567,"box":{"x":503,"y":215,"width":417,"height":12}},{"id":"31b98d2b-19d1-4d2c-be4c-8b29af812289","block_type":"box","text":"earned (including both original issue and market discount), (ii) l","page_number":567,"box":{"x":46,"y":231,"width":441,"height":12}},{"id":"c1408949-fdae-4c81-8338-847e7b47a913","block_type":"box","text":"ess amortization of premiums and the estimated expenses of a","page_number":567,"box":{"x":488,"y":231,"width":429,"height":12}},{"id":"75814986-c0c5-417a-8906-96fad6ac6ebb","block_type":"box","text":"Fund applicable to that dividend period. Net realized capital gains (including net short-term capital gain), if any, will be","page_number":567,"box":{"x":45,"y":246,"width":830,"height":13}},{"id":"074bf0ca-0a0f-489b-b881-182a6fbf0401","block_type":"box","text":"distributed by the Funds at least annually.","page_number":567,"box":{"x":46,"y":262,"width":289,"height":12}},{"id":"d8b21351-e001-4d7b-a518-319022a621b0","block_type":"box","text":"Taxes","page_number":567,"box":{"x":45,"y":294,"width":43,"height":10}},{"id":"bc238f6f-0548-46b4-a9a1-f88efc0e1034","block_type":"box","text":"Each Fund intends to elect and to qualify or to continue to qualify, as appropriate, for the special tax treatment afforded regulated","page_number":567,"box":{"x":45,"y":321,"width":904,"height":12}},{"id":"ff2fb061-34f5-4758-af5b-e328ea1a1dc3","block_type":"box","text":"investment companies under the Code. As long as a Fund so qualifies, the Fund (but not its shareholders) will not be subject to","page_number":567,"box":{"x":45,"y":336,"width":879,"height":13}},{"id":"3e2e2597-e8a6-4ee8-990c-c82c8e69fd80","block_type":"box","text":"Federal income tax on the part of its investment company taxable","page_number":567,"box":{"x":45,"y":352,"width":456,"height":12}},{"id":"acff2332-a02a-4132-9cb1-fde5738cbf83","block_type":"box","text":"income and net capital gain that is distributed to shareholders.","page_number":567,"box":{"x":506,"y":352,"width":431,"height":12}},{"id":"b0df6f06-ca4d-489f-b30d-b26d267dc71d","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 qualify as a","page_number":567,"box":{"x":45,"y":367,"width":863,"height":13}},{"id":"12b2abc9-51ba-4e39-ae7e-ead48e091ed4","block_type":"box","text":"regulated investment company under the Code, notwithstanding","page_number":567,"box":{"x":45,"y":383,"width":447,"height":12}},{"id":"3ce27c1c-ec83-4774-b690-cca4ff92dece","block_type":"box","text":"the availability of certain relief provisions, such Fund would be","page_number":567,"box":{"x":497,"y":383,"width":436,"height":12}},{"id":"e349ce28-d922-4e37-a739-e07df7d8d310","block_type":"box","text":"taxed in the same manner as an ordinary corporation and all distributions from earnings and profits (as determined under Federal","page_number":567,"box":{"x":45,"y":398,"width":902,"height":13}},{"id":"ff37b035-b0a9-43c3-be1c-e432644445b3","block_type":"box","text":"income tax principles) to its shareholders would be taxable as ordi","page_number":567,"box":{"x":45,"y":414,"width":461,"height":12}},{"id":"92336bf5-9f8c-42a0-8f35-605f9f18bdf1","block_type":"box","text":"nary dividend income eligible for taxation at a reduced tax rate","page_number":567,"box":{"x":506,"y":414,"width":438,"height":12}},{"id":"0554f3b7-dc3f-4ec9-8599-c6c5f9e30eba","block_type":"box","text":"for non-corporate shareholders and the dividends","page_number":567,"box":{"x":45,"y":429,"width":343,"height":13}},{"id":"b01b9c17-d934-4417-8aa0-b8df54d2d495","block_type":"box","text":"-received deduction for corporate shareholders.","page_number":567,"box":{"x":389,"y":429,"width":326,"height":13}},{"id":"a6ebb3c9-78e8-422f-b475-80aee71e6843","block_type":"box","text":"Each Fund that is a series of a regulated investment company that consists of multiple series is treated as a separate corporation for","page_number":567,"box":{"x":45,"y":453,"width":908,"height":13}},{"id":"161d2093-896b-4a76-a094-38517ee8bb2c","block_type":"box","text":"Federal income tax purposes, and, therefore, is considered to be a sep","page_number":567,"box":{"x":45,"y":468,"width":481,"height":13}},{"id":"5beeeb17-5d2f-4f63-b84d-dd4b10741c5f","block_type":"box","text":"arate entity in determining its treatment under the rules for","page_number":567,"box":{"x":527,"y":468,"width":408,"height":13}},{"id":"b6f58936-6ed7-4f1e-be3e-716925ad2a19","block_type":"box","text":"regulated investment companies. Losses in one series of a regulat","page_number":567,"box":{"x":45,"y":484,"width":448,"height":13}},{"id":"31ae18fb-368e-4721-a756-9c3e0d44b706","block_type":"box","text":"ed investment company do not offset gains in another, and the","page_number":567,"box":{"x":494,"y":484,"width":433,"height":13}},{"id":"a70923c1-87e3-4135-ba6f-3ff2611eef12","block_type":"box","text":"requirements (other than certain organizational requirements","page_number":567,"box":{"x":45,"y":499,"width":423,"height":13}},{"id":"2bff9abb-852f-4eae-b308-cf2d66bc3945","block_type":"box","text":") for qualifying for regulated investment company status will be","page_number":567,"box":{"x":470,"y":499,"width":440,"height":13}},{"id":"6280f692-553a-41d2-bda0-52cddd7ebcad","block_type":"box","text":"determined at the level of the individual series. In the following discussion, the term “Fund” means each individual series, if","page_number":567,"box":{"x":46,"y":515,"width":856,"height":13}},{"id":"e12eaf64-5beb-4890-8bca-776047853421","block_type":"box","text":"applicable.","page_number":567,"box":{"x":46,"y":530,"width":73,"height":13}},{"id":"6ccdfd8c-ace8-4518-bf27-393c8ba1ec3d","block_type":"box","text":"The Code requires a regulated investment company to pay a nondeductible 4% excise tax to the extent the regulated investment","page_number":567,"box":{"x":45,"y":554,"width":889,"height":13}},{"id":"84bebc98-c47e-4879-9971-0d377f2a857b","block_type":"box","text":"company does not distribute, during each calendar year, at least","page_number":567,"box":{"x":45,"y":570,"width":443,"height":13}},{"id":"7b64bbf2-57d9-4052-a4cb-2f8154f45019","block_type":"box","text":"98% of its ordinary income, determined on a calendar year basis,","page_number":567,"box":{"x":493,"y":570,"width":453,"height":13}},{"id":"a4ff4746-82f8-420c-85fb-f2cc5e91f310","block_type":"box","text":"and at least 98.2% of its capital gain net income, determined, in g","page_number":567,"box":{"x":46,"y":585,"width":456,"height":13}},{"id":"7ee9fbb4-dc69-46b6-8444-e201e6c31a6f","block_type":"box","text":"eneral, as if the regulated investment company’s taxable year","page_number":567,"box":{"x":503,"y":585,"width":421,"height":13}},{"id":"3c4b3bc7-8810-4a43-9b70-61935736e7b8","block_type":"box","text":"ended on October 31, plus certain undistributed amounts from t","page_number":567,"box":{"x":46,"y":601,"width":446,"height":13}},{"id":"4200d8a2-768b-4824-b99e-cc29aa0ea0a0","block_type":"box","text":"he preceding year. While each Fund intends to distribute its","page_number":567,"box":{"x":493,"y":601,"width":411,"height":13}},{"id":"fe818b17-5a33-4d2d-88ba-54c7fe5d4ca1","block_type":"box","text":"income and capital gains in the manner necessary to minimize imposition of the 4% excise tax, there can be no assurance that","page_number":567,"box":{"x":45,"y":616,"width":873,"height":13}},{"id":"7937a983-e482-406d-809b-298c9422d705","block_type":"box","text":"sufficient amounts of a Fund’s taxable income and capital gains","page_number":567,"box":{"x":46,"y":632,"width":440,"height":13}},{"id":"f0cf362c-c87b-4bfb-99de-44b65d5c42f8","block_type":"box","text":"will be distributed to avoid entirely the imposition of the tax. In","page_number":567,"box":{"x":491,"y":632,"width":442,"height":13}},{"id":"3f4783e1-3a8f-4f49-9019-6cb9f77e064c","block_type":"box","text":"such event, a Fund will be liable for the tax only on the amount by which it does not meet the foregoing distribution requirements.","page_number":567,"box":{"x":46,"y":647,"width":904,"height":13}},{"id":"ce6e6bb5-e1e7-41ae-8fc3-70a792ab68d4","block_type":"box","text":"The required distributions are based only on the taxa","page_number":567,"box":{"x":45,"y":663,"width":369,"height":13}},{"id":"fd75de03-e62e-4111-bc44-8430ce214001","block_type":"box","text":"ble income of a regulated investment company.","page_number":567,"box":{"x":415,"y":663,"width":326,"height":13}},{"id":"58cce100-fe8e-4888-81f2-5af816a44bea","block_type":"box","text":"General Treatment of Fund Shareholders.","page_number":567,"box":{"x":46,"y":695,"width":301,"height":13}},{"id":"266462cb-28fa-4e22-8e06-5c19a7179384","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-term capital loss","page_number":567,"box":{"x":45,"y":722,"width":905,"height":13}},{"id":"4022a36c-10cc-497d-8255-f66b8162cd97","block_type":"box","text":"(together referred to hereafter as “ordinary income dividends”) are taxable to shareholders as ordinary income. Distributions","page_number":567,"box":{"x":46,"y":737,"width":866,"height":13}},{"id":"b53c20b0-07b2-4272-bb21-e66a47df0f17","block_type":"box","text":"made from an excess of net long-term capital gain over net short-term capital loss (“capital gain dividends”) are taxable to","page_number":567,"box":{"x":45,"y":753,"width":850,"height":13}},{"id":"0edc925f-408d-4fa9-bb4c-9610530be1f7","block_type":"box","text":"shareholders as long-term capital gain, regardless of the length o","page_number":567,"box":{"x":46,"y":768,"width":445,"height":13}},{"id":"b3986cc8-bf57-4fea-a079-d303aa666fd8","block_type":"box","text":"f time the shareholder has owned Fund shares. Distributions paid","page_number":567,"box":{"x":492,"y":768,"width":453,"height":13}},{"id":"2cad6be0-3ddf-45a8-b774-46e9d1e9169c","block_type":"box","text":"by a Fund that are reported as exempt-interest dividends will not be subject to regular Federal income tax. Certain dividend","page_number":567,"box":{"x":46,"y":784,"width":857,"height":13}},{"id":"62f7fc69-5135-42a6-aa65-fe4ab3aa5526","block_type":"box","text":"income and long-term capital gains are eligible for taxation at a","page_number":567,"box":{"x":45,"y":799,"width":441,"height":13}},{"id":"486494b5-d2ed-41ff-9ad4-423849034a65","block_type":"box","text":"reduced rate that applies to non-corporate shareholders. Under","page_number":567,"box":{"x":491,"y":799,"width":437,"height":13}},{"id":"c7910e77-70fc-4858-9da6-2b2ba83476fa","block_type":"box","text":"these rules, the portion of ordinary income dividends cons","page_number":567,"box":{"x":45,"y":815,"width":402,"height":13}},{"id":"2ca55e47-7255-4adf-aed9-25264d57fe56","block_type":"box","text":"tituting “qualified dividend income” when paid by a regulated","page_number":567,"box":{"x":448,"y":815,"width":433,"height":13}},{"id":"ad1b6482-1139-43f3-989f-f2170edaf184","block_type":"box","text":"investment company to non-corporate shareholders may be taxable","page_number":567,"box":{"x":45,"y":830,"width":468,"height":13}},{"id":"17e83ce1-aa48-4e9c-81f8-e0dba12251f4","block_type":"box","text":"to such shareholders at long-term capital gain rates. However,","page_number":567,"box":{"x":518,"y":830,"width":431,"height":13}},{"id":"a6aedb60-ceeb-4eb7-8098-308fdd225cb9","block_type":"box","text":"to the extent a Fund’s distributions are derived from income on debt securities and short-term capital gains, such distributions will","page_number":567,"box":{"x":45,"y":846,"width":903,"height":13}},{"id":"a42993d2-110b-46e8-b53c-c2c9f04245d6","block_type":"box","text":"not constitute “qualified dividend income.” Thus, ordinary income dividends paid by the Funds generally will not be eligible for","page_number":567,"box":{"x":45,"y":861,"width":888,"height":13}},{"id":"db85615d-a41f-4734-9da6-d3a14acd85ac","block_type":"box","text":"taxation at the reduced rate.","page_number":567,"box":{"x":45,"y":877,"width":195,"height":10}},{"id":"b06cd705-a032-4bb7-8537-64832e42c2fc","block_type":"box","text":"II-57","page_number":567,"box":{"x":482,"y":917,"width":35,"height":9}},{"id":"8f303bf8-1835-4bd5-b411-49868c9c5ad6","block_type":"box","text":"NM1026U-6004382-567/605","page_number":567,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"540d3076-de4e-4eb2-8a27-20e9e163984b","block_type":"box","text":"Any loss upon the sale or exchange of Fund shares held for six months or less will be treated as long-term capital loss to the extent","page_number":568,"box":{"x":45,"y":79,"width":905,"height":13}},{"id":"504c4d5c-5be0-40b8-9c53-27646f8dfa68","block_type":"box","text":"of any capital gain dividends received with respect to the shares. Distributions in excess of a Fund’s earnings and profits will first","page_number":568,"box":{"x":46,"y":94,"width":891,"height":13}},{"id":"a922b367-19ae-476c-8a92-d792ad821d93","block_type":"box","text":"reduce the shareholder’s adjusted tax basis in his shares and any amount in excess of such basis will constitute capital gains to","page_number":568,"box":{"x":45,"y":110,"width":873,"height":13}},{"id":"4b67decb-2946-4f13-8c7a-b79e993f83ec","block_type":"box","text":"such shareholder (assuming the shares are held as a capital asset). Long-term capital gains (","page_number":568,"box":{"x":46,"y":125,"width":630,"height":13}},{"id":"6e44741f-d93e-4baf-aef2-52b51b3d53b6","block_type":"box","text":"i.e.,","page_number":568,"box":{"x":678,"y":126,"width":23,"height":11}},{"id":"85fcf8ab-cf54-4889-8b60-ed5dc0374711","block_type":"box","text":"gains from a sale or exchange of","page_number":568,"box":{"x":706,"y":125,"width":225,"height":13}},{"id":"b2be73fb-9cbc-41ba-9efd-5cc551f1dd11","block_type":"box","text":"capital assets held for more than one year) are generally taxed at preferential rates to non-corporate taxpayers. Each Fund will","page_number":568,"box":{"x":45,"y":141,"width":876,"height":13}},{"id":"6cccd55d-8478-4973-a62d-16f6759cceaf","block_type":"box","text":"furnish its shareholders with a written statement reporting the amounts of its dividends paid during the year that qualify as capital","page_number":568,"box":{"x":45,"y":156,"width":903,"height":13}},{"id":"ddce6cf8-1f92-47bc-811e-a0d67c92bc99","block_type":"box","text":"gain dividends or exempt-interest dividends, as applicable, as well as the portion of an exempt-interest dividend that constitutes an","page_number":568,"box":{"x":45,"y":172,"width":905,"height":13}},{"id":"e4ce0d21-0c0d-4ce6-b614-87dca9b54c6f","block_type":"box","text":"item of tax preference, as discussed below.","page_number":568,"box":{"x":45,"y":187,"width":294,"height":13}},{"id":"989f3b18-8496-49e7-a9b5-01220b0df4a6","block_type":"box","text":"Ordinary income and capital gain dividends are taxable to shareholders even if they are reinvested in additional shares of a Fund.","page_number":568,"box":{"x":46,"y":211,"width":895,"height":12}},{"id":"5b797fef-b285-493f-9231-ff89255fcedd","block_type":"box","text":"Distributions by a Fund, whether from ordinary income or capital gains, generally will not be eligible for the dividends received","page_number":568,"box":{"x":45,"y":226,"width":884,"height":13}},{"id":"0ec83b4e-e42d-4a8b-ad71-b71cd3498c02","block_type":"box","text":"deduction allowed to corporations under the Code. If a Fund pays a dividend in January that was declared in the previous","page_number":568,"box":{"x":46,"y":242,"width":845,"height":12}},{"id":"4c514fd3-422a-41ff-bf2d-7e281664c9ba","block_type":"box","text":"October, November or December to shareholders of record on a specified date in one of such months, then such dividend will be","page_number":568,"box":{"x":46,"y":257,"width":893,"height":13}},{"id":"762d2b1a-006b-43ae-9c52-afca1134c0d6","block_type":"box","text":"treated for tax purposes as being paid by the Fund and received by its shareholders on December 31 of the year in which such","page_number":568,"box":{"x":45,"y":273,"width":872,"height":12}},{"id":"f8d55b55-f595-487a-8d1e-0d4073a3684c","block_type":"box","text":"dividend was declared.","page_number":568,"box":{"x":46,"y":288,"width":156,"height":10}},{"id":"5e72c273-2937-448d-9390-900dccbf15cc","block_type":"box","text":"A shareholder in a money market fund (whether or not it has a floating NAV) may elect to adopt a simplified, aggregate","page_number":568,"box":{"x":45,"y":311,"width":835,"height":13}},{"id":"7fc9b1be-2941-4370-9a03-c9a1890b394d","block_type":"box","text":"accounting method under which gains and losses can be netted based on the shareholder’s taxable year rather than reported","page_number":568,"box":{"x":46,"y":327,"width":858,"height":13}},{"id":"7797069b-fc0b-4c86-a62b-c62d3d22a44e","block_type":"box","text":"separately. Shareholders are urged to consult their tax advisors before deciding to adopt such accounting method.","page_number":568,"box":{"x":46,"y":342,"width":786,"height":13}},{"id":"a421a70d-8931-44c6-93e1-0f9260297ea6","block_type":"box","text":"If any Fund (other than a Fund that is a government money market fund) imposes a discretionary liquidity fee on share","page_number":568,"box":{"x":45,"y":366,"width":826,"height":12}},{"id":"5806acdf-7d43-424a-9331-22280c2eaa5b","block_type":"box","text":"redemptions, the amount that would ordinarily be payable to a","page_number":568,"box":{"x":45,"y":381,"width":438,"height":13}},{"id":"b828555a-b2cf-451e-ba6f-e25a9262835a","block_type":"box","text":"redeeming shareholder of the Fund will be reduced, consequently","page_number":568,"box":{"x":488,"y":381,"width":452,"height":13}},{"id":"97de88f0-8dd4-46b1-9fef-6a6281112e26","block_type":"box","text":"reducing the amount of gain, or increasing the amount of loss, that would otherwise be reportable for income tax purposes. The","page_number":568,"box":{"x":45,"y":397,"width":889,"height":12}},{"id":"1e3f11c6-4bf7-40c4-a428-919f045c5572","block_type":"box","text":"discretionary liquidity fee cannot be separately claimed as a deduction.","page_number":568,"box":{"x":46,"y":412,"width":488,"height":13}},{"id":"370a63f4-33be-4061-b3b0-0086de9157ef","block_type":"box","text":"Any such discretionary liquidity fee will constitute an asset","page_number":568,"box":{"x":45,"y":435,"width":407,"height":13}},{"id":"b0bc54d7-d574-4e70-954b-aeefca24599f","block_type":"box","text":"of the imposing Fund and will serve to benefit non-redeeming","page_number":568,"box":{"x":457,"y":435,"width":427,"height":13}},{"id":"6e05226c-a9da-472c-95a3-36a607b0e163","block_type":"box","text":"shareholders. If such fees were distributed to non-redeeming share","page_number":568,"box":{"x":46,"y":451,"width":457,"height":13}},{"id":"1ba5f360-8298-45bf-b630-829d0c4e87da","block_type":"box","text":"holders, the tax treatment would be similar to the tax treatment","page_number":568,"box":{"x":504,"y":451,"width":443,"height":12}},{"id":"b4f2d419-0655-4393-b0d1-a42eba37357a","block_type":"box","text":"of distributions described in this section. Such fees may raise","page_number":568,"box":{"x":46,"y":466,"width":417,"height":13}},{"id":"d9fe3f71-68ed-429d-b7c8-bce7503ae84f","block_type":"box","text":"the Fund’s NAV, increasing the taxable income or reducing the","page_number":568,"box":{"x":468,"y":466,"width":438,"height":13}},{"id":"34ec66ff-2635-4061-b9f6-e543df1f3283","block_type":"box","text":"deductible losses of shareholders that redeem their shares at a later time when such fees are not being charged. If a Fund receives","page_number":568,"box":{"x":46,"y":482,"width":889,"height":13}},{"id":"037becfc-884e-4b54-b137-f37379d124c9","block_type":"box","text":"discretionary liquidity fees, it will consider the appropriate tax t","page_number":568,"box":{"x":46,"y":497,"width":441,"height":13}},{"id":"e62eb1c5-109e-45ce-9d67-17b76f899db2","block_type":"box","text":"reatment of such fees to the Fund at such time. However, due to a","page_number":568,"box":{"x":488,"y":497,"width":457,"height":13}},{"id":"3587e25d-17d5-4fe6-b59e-8587ab8674c3","block_type":"box","text":"lack of guidance, the tax consequences of liquidity fees to th","page_number":568,"box":{"x":45,"y":513,"width":417,"height":13}},{"id":"1bbaad6c-fb0d-489b-934a-9c2567430bb5","block_type":"box","text":"e Fund and the shareholders is unclear and may differ from that","page_number":568,"box":{"x":462,"y":513,"width":443,"height":13}},{"id":"fc589810-90d6-463b-85e8-f4002339987a","block_type":"box","text":"described in this section.","page_number":568,"box":{"x":46,"y":528,"width":167,"height":10}},{"id":"810c6c5b-2b64-4bd0-a6f7-c338c6b1b3a2","block_type":"box","text":"Should a negative interest rate scenario ever occur that causes a government or retail money market fund to have a negative gross","page_number":568,"box":{"x":46,"y":552,"width":896,"height":12}},{"id":"11786e64-e2ad-4e35-8b53-5e95b4aa5582","block_type":"box","text":"yield, the fund may account for the negative gross yield by either using a floating NAV or a reverse distribution mechanism that","page_number":568,"box":{"x":45,"y":567,"width":886,"height":13}},{"id":"09e98e71-81a8-47a1-9534-02b3f741cd2b","block_type":"box","text":"seeks to maintain a stable NAV of the fund by cancelling shareholders’ shares in the amount of the negative gross yield. Under a","page_number":568,"box":{"x":46,"y":583,"width":888,"height":12}},{"id":"eba37b1e-2247-4bc1-9b38-767dfc5cd8d5","block_type":"box","text":"reverse distribution mechanism, shareholders in a fund would ob","page_number":568,"box":{"x":45,"y":598,"width":450,"height":12}},{"id":"c4f08bea-08b8-4660-8622-96cce25de8e9","block_type":"box","text":"serve a stable share price but a declining number of shares for","page_number":568,"box":{"x":497,"y":598,"width":426,"height":13}},{"id":"1ef925d8-3c75-4b7b-b516-2e08693e332a","block_type":"box","text":"their investment. After a cancellation of shares, the basis of eliminated shares would be added to the basis of shareholders’","page_number":568,"box":{"x":45,"y":614,"width":846,"height":12}},{"id":"07420437-e332-4786-88b7-d278f40068f4","block_type":"box","text":"remaining fund shares, and any shareholders disposing of shares","page_number":568,"box":{"x":45,"y":629,"width":446,"height":13}},{"id":"37e4f36c-9bde-4090-b383-278d29c35364","block_type":"box","text":"at that time may recognize a capital loss. Dividends, including","page_number":568,"box":{"x":496,"y":629,"width":429,"height":13}},{"id":"68061b63-d039-402f-8383-355cbb4f65c0","block_type":"box","text":"dividends reinvested in additional shares of a fund, will nonetheless be fully taxable, even if the number of shares in shareholders’","page_number":568,"box":{"x":46,"y":645,"width":895,"height":12}},{"id":"42908199-a2e6-4f79-b968-1032155975b9","block_type":"box","text":"accounts has been reduced as described above. However, due to a lack of guidance regarding the cancellation of shares, the tax","page_number":568,"box":{"x":46,"y":660,"width":880,"height":13}},{"id":"ac17bb11-1838-43ee-9444-c6bea7bd6506","block_type":"box","text":"consequences of such cancellation of shares to the Fund and the shareholders is unclear and may differ from that described in this","page_number":568,"box":{"x":45,"y":676,"width":898,"height":12}},{"id":"f7181565-215e-4a66-92cf-b8716706589e","block_type":"box","text":"section.","page_number":568,"box":{"x":46,"y":692,"width":51,"height":9}},{"id":"6ab081be-364b-4dcd-80d1-b677661fd019","block_type":"box","text":"Under certain provisions of the Code, some shareholders may b","page_number":568,"box":{"x":45,"y":714,"width":441,"height":13}},{"id":"8c32df07-b9ea-4e93-8aa4-5fa32fb37dcd","block_type":"box","text":"e subject to a 24% withholding tax on ordinary income dividends","page_number":568,"box":{"x":487,"y":714,"width":456,"height":13}},{"id":"25cf5f75-10ce-4374-8f3d-3fac0caf8f58","block_type":"box","text":"and capital gain dividends (“backup withholding”). Generally, s","page_number":568,"box":{"x":46,"y":730,"width":444,"height":13}},{"id":"0b3079e2-76ef-4aba-9893-ba3115494926","block_type":"box","text":"hareholders subject to backup withholding will be non-corporate","page_number":568,"box":{"x":491,"y":730,"width":451,"height":13}},{"id":"3a8003c8-9749-4cea-a472-eb2cbcc3ef4c","block_type":"box","text":"shareholders for whom no certified taxpayer identification number is on file with a Fund or who, to a Fund’s knowledge, have","page_number":568,"box":{"x":46,"y":745,"width":877,"height":13}},{"id":"591463e0-bf35-4fed-b852-38817daebe71","block_type":"box","text":"furnished an incorrect number. When establishing an account, an investor must certify under penalty of perjury that such number","page_number":568,"box":{"x":45,"y":761,"width":900,"height":13}},{"id":"627ce97f-7cec-430a-9ccf-09372f228eab","block_type":"box","text":"is correct and that the investor is not otherwise subject to backup withholding. Backup withholding is not an additional tax. Any","page_number":568,"box":{"x":45,"y":776,"width":895,"height":13}},{"id":"d2101121-c062-4697-ad0c-0c33e2ce49b8","block_type":"box","text":"amount withheld generally may be allowed as a refund or a credit against a shareholder’s Federal income tax liability provided","page_number":568,"box":{"x":46,"y":792,"width":878,"height":13}},{"id":"8e99699f-5635-4aba-a452-9f1bb83abf64","block_type":"box","text":"that the required information is timely provided to the IRS.","page_number":568,"box":{"x":45,"y":807,"width":410,"height":13}},{"id":"c2933852-1c2c-4a51-9db5-a0921c078484","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 year or $4 million in","page_number":568,"box":{"x":45,"y":830,"width":887,"height":14}},{"id":"5488fb39-32b0-48c7-b2aa-b5f41b097a8d","block_type":"box","text":"any combination of taxable years for an individual shareholder or $10 million in any single taxable year or $20 million in any","page_number":568,"box":{"x":46,"y":846,"width":874,"height":13}},{"id":"d6d75d8c-d704-4c9b-ba72-6ad3f5cf97e9","block_type":"box","text":"combination of taxable years for a corporate shareholder in any single taxable year, the shareholder must file a disclosure","page_number":568,"box":{"x":45,"y":862,"width":843,"height":13}},{"id":"400f53c3-015f-426f-8fdb-befb3d815af3","block_type":"box","text":"statement on Form 8886 with the IRS. Direct shareholders of por","page_number":568,"box":{"x":46,"y":877,"width":454,"height":13}},{"id":"853d54b0-088a-4571-8298-4c02e5a1e154","block_type":"box","text":"tfolio securities are in many cases exempted from this reporting","page_number":568,"box":{"x":500,"y":877,"width":439,"height":13}},{"id":"6355bb63-05e7-49f0-b113-7fdb0068477c","block_type":"box","text":"II-58","page_number":568,"box":{"x":482,"y":917,"width":34,"height":9}},{"id":"edf5e0e8-e7a4-4661-a24a-024386384c2d","block_type":"box","text":"NM1026U-6004382-568/605","page_number":568,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"87652ac8-d6b1-4911-98d7-cb5e440a52b8","block_type":"box","text":"requirement, but under current guidance, shareholders of a reg","page_number":569,"box":{"x":45,"y":79,"width":435,"height":13}},{"id":"2cb5fb54-94c9-41a8-bb0b-95a859b9beb0","block_type":"box","text":"ulated investment company are not exempted. That a loss is","page_number":569,"box":{"x":481,"y":79,"width":415,"height":13}},{"id":"975e999d-c18d-4a59-afd3-7de573a92eaa","block_type":"box","text":"reportable under these regulations does not affect the legal determination of whether the taxpayer’s treatment of the loss is proper.","page_number":569,"box":{"x":45,"y":94,"width":904,"height":13}},{"id":"e5fb1fc8-c6d8-4d7d-8345-9925971965a4","block_type":"box","text":"Shareholders should consult their tax advisors to determine the applicability of these regulations in light of their individual","page_number":569,"box":{"x":46,"y":110,"width":848,"height":13}},{"id":"dd22f207-a50b-4c56-b6f9-d5a8a91c49cc","block_type":"box","text":"circumstances.","page_number":569,"box":{"x":45,"y":126,"width":100,"height":9}},{"id":"d21d4a35-dbf7-4d0f-beb9-6e47808c3b7a","block_type":"box","text":"A 3.8% Medicare tax is imposed on the net investment income (wh","page_number":569,"box":{"x":45,"y":149,"width":469,"height":12}},{"id":"ffe4a950-a2b1-44c3-b5a6-324d420b4d74","block_type":"box","text":"ich includes, but is not limited to, interest, dividends and net","page_number":569,"box":{"x":515,"y":149,"width":417,"height":12}},{"id":"a2d12cc4-81be-4aa0-96a2-23ea08e431c8","block_type":"box","text":"gains from investments) of U.S. individuals with income ex","page_number":569,"box":{"x":45,"y":164,"width":409,"height":13}},{"id":"ef88654d-28ed-415d-841c-1227f11db781","block_type":"box","text":"ceeding $200,000, or $250,000 if married filing jointly, and of trusts","page_number":569,"box":{"x":454,"y":164,"width":477,"height":13}},{"id":"c78ade14-013f-466c-89cd-e9afd157ee3a","block_type":"box","text":"and estates. However, this tax will not apply to certain amounts that are already excludable from gross income, such as interest on","page_number":569,"box":{"x":46,"y":180,"width":906,"height":12}},{"id":"5de61b4f-03f8-4d4e-b393-d9a9abb53de9","block_type":"box","text":"tax-exempt bonds.","page_number":569,"box":{"x":45,"y":195,"width":129,"height":13}},{"id":"65b60dc6-0b05-4cab-ab1a-d37f5a098380","block_type":"box","text":"No gain or loss will be recognized by Investor C shareholders on the conversion to Investor A Shares. A shareholder’s tax basis in","page_number":569,"box":{"x":45,"y":218,"width":898,"height":13}},{"id":"78998541-1077-40a7-af47-9000c1f27bde","block_type":"box","text":"the Investor A Shares acquired upon conversion will be the same as the shareholder’s tax basis in the converted Investor C Shares","page_number":569,"box":{"x":45,"y":234,"width":896,"height":13}},{"id":"4a440872-8069-47bf-adff-2691e54da749","block_type":"box","text":"and the holding period of the acquired Investor A Shares will in","page_number":569,"box":{"x":46,"y":249,"width":440,"height":13}},{"id":"abfa52ba-5ab9-4f18-8656-badf3a0fcc2a","block_type":"box","text":"clude the holding period for the converted Investor C Shares.","page_number":569,"box":{"x":487,"y":249,"width":421,"height":13}},{"id":"635fb1da-e3bf-4c2b-aeae-bc9963655d58","block_type":"box","text":"Interest received by a Fund may give rise to withholding and other taxes imposed by foreign countries. Tax conventions between","page_number":569,"box":{"x":45,"y":273,"width":892,"height":12}},{"id":"ac784b7d-eac9-4a92-ba51-bee745ef8618","block_type":"box","text":"certain countries and the United States may reduce or eliminate such taxes.","page_number":569,"box":{"x":45,"y":288,"width":518,"height":13}},{"id":"00fe8747-d3c9-408b-88a2-86bfdec557b7","block_type":"box","text":"Ordinary income dividends paid to shareholders that are nonresident aliens or foreign entities generally will be subject to a 30%","page_number":569,"box":{"x":46,"y":311,"width":887,"height":13}},{"id":"850b4a27-81b4-4737-bfcb-d5cb6bf61184","block_type":"box","text":"U.S. withholding tax under existing provisions of the Code applic","page_number":569,"box":{"x":45,"y":327,"width":455,"height":13}},{"id":"146af6df-f112-4566-8c3d-267a0971a9bb","block_type":"box","text":"able to foreign individuals and entities unless a reduced rate of","page_number":569,"box":{"x":501,"y":327,"width":432,"height":13}},{"id":"acd65d80-58b9-4a6e-bfe2-6e624612ea24","block_type":"box","text":"withholding is provided under applicable treaty law. Nonresident shareholders are urged to consult their own tax advisors","page_number":569,"box":{"x":45,"y":342,"width":849,"height":13}},{"id":"2a64d629-e9ef-4267-a292-266c9724fa2d","block_type":"box","text":"concerning applicability of the United States withholding tax. Div","page_number":569,"box":{"x":45,"y":358,"width":456,"height":13}},{"id":"e1e97dc1-e4a4-4d2c-991e-b0ff5a6b4cda","block_type":"box","text":"idends derived by a regulated investment company from short","page_number":569,"box":{"x":501,"y":358,"width":434,"height":13}},{"id":"db2b1a36-9390-42e4-a9ca-99a251384714","block_type":"box","text":"term capital gains and qualified net interest income (including inco","page_number":569,"box":{"x":45,"y":373,"width":462,"height":13}},{"id":"a5464415-5f71-49f7-b616-9617695fcbfd","block_type":"box","text":"me from original issue discount and market discount) and paid","page_number":569,"box":{"x":508,"y":373,"width":436,"height":13}},{"id":"eeae8e42-957f-4f1e-8eaa-fbe8cfecc892","block_type":"box","text":"to stockholders that are nonresident aliens and foreign entities, if and to the extent properly reported as “interest-related","page_number":569,"box":{"x":45,"y":389,"width":834,"height":13}},{"id":"4d067cc7-acbe-4d46-b8c7-89848e1b5c17","block_type":"box","text":"dividends” or “short-term capital gain dividends,” generally will not be subject to U.S. withholding tax. Where possible, each","page_number":569,"box":{"x":46,"y":404,"width":869,"height":13}},{"id":"66fbad0d-2571-4b50-99dd-395dc5c753fb","block_type":"box","text":"Fund intends to report such dividends as interest-related divide","page_number":569,"box":{"x":45,"y":420,"width":435,"height":13}},{"id":"7e896dc3-b7cb-47da-9ed2-8a39a4293b63","block_type":"box","text":"nds or short-term capital gain dividends. However, depending on its","page_number":569,"box":{"x":481,"y":420,"width":472,"height":13}},{"id":"2e13d817-7579-49dd-b73b-95cd268b015e","block_type":"box","text":"circumstances, a Fund may report all, some or none of its potentially e","page_number":569,"box":{"x":45,"y":435,"width":488,"height":13}},{"id":"032fe3ce-58de-4884-b698-a85c2b80856f","block_type":"box","text":"ligible dividends as interest-related dividends or as short","page_number":569,"box":{"x":534,"y":435,"width":392,"height":13}},{"id":"97cda56a-23f2-4a18-92f2-d5bfe1fe4ccf","block_type":"box","text":"term capital gain dividends, and/or treat such dividends, in whole or in part, as ineligible for this exemption from withholding. In","page_number":569,"box":{"x":45,"y":451,"width":896,"height":13}},{"id":"8ab8271c-8466-4834-b8ad-f3d9b51ecd1f","block_type":"box","text":"order to qualify for this exemption from withholding, a non-U.S. shareholder must comply with applicable certification","page_number":569,"box":{"x":46,"y":466,"width":828,"height":13}},{"id":"e4dfb96d-620e-465d-96ff-cb092a508c27","block_type":"box","text":"requirements relating to its non-U.S. status (including, in g","page_number":569,"box":{"x":45,"y":482,"width":405,"height":13}},{"id":"8a5e0fe0-2f54-4b9a-bfc6-86fa7f086de8","block_type":"box","text":"eneral, furnishing an IRS Form W-8BEN, W-8BEN-E or substitute","page_number":569,"box":{"x":450,"y":482,"width":462,"height":13}},{"id":"0f6be447-f131-4505-836b-5b9a17582305","block_type":"box","text":"form). In the case of shares held through an intermediary, the in","page_number":569,"box":{"x":45,"y":497,"width":444,"height":13}},{"id":"471f562a-206c-4421-8d93-c583a4edcd07","block_type":"box","text":"termediary may withhold even if the Fund reports the payment as","page_number":569,"box":{"x":489,"y":497,"width":455,"height":13}},{"id":"b59b0865-5305-4417-b612-7706fe4e9fa2","block_type":"box","text":"an interest-related dividend or short term capital gain dividend.","page_number":569,"box":{"x":46,"y":513,"width":437,"height":13}},{"id":"f0910b3a-2469-46e6-b712-b4045632d89e","block_type":"box","text":"Non-U.S. shareholders should contact their intermediaries with","page_number":569,"box":{"x":489,"y":513,"width":439,"height":10}},{"id":"08d63b9e-5783-422b-9e07-2ad690d67bfe","block_type":"box","text":"respect to the application of these rules to their accounts. It is not possible to predict what portion, if any, of a Fund’s distributions","page_number":569,"box":{"x":45,"y":528,"width":906,"height":13}},{"id":"577fe6cd-bc11-4822-b9c3-7d5c5abf99b5","block_type":"box","text":"will be designated as consisting of qualified short term gain or qualified net interest income exempt from withholding in the hands","page_number":569,"box":{"x":45,"y":544,"width":903,"height":13}},{"id":"8637436f-dbf1-4c6a-9079-f9196e01b26b","block_type":"box","text":"of nonresident and foreign shareholders.","page_number":569,"box":{"x":46,"y":559,"width":279,"height":13}},{"id":"a48e161b-f2ac-48bd-a911-fea7f76ecf20","block_type":"box","text":"Separately, a 30% withholding tax is currently imposed on U.S. source dividends, interest and other income items paid to","page_number":569,"box":{"x":46,"y":583,"width":842,"height":12}},{"id":"63d51935-5164-4eaa-ae9a-0c5477bbe43d","block_type":"box","text":"(i) certain foreign financial institutions and investment funds, a","page_number":569,"box":{"x":46,"y":598,"width":435,"height":13}},{"id":"b6186b15-b153-4134-aafb-6a8d8c5abb91","block_type":"box","text":"nd (ii) certain other foreign entities. To avoid withholding, foreign","page_number":569,"box":{"x":482,"y":598,"width":458,"height":13}},{"id":"751d160f-19d2-49d0-9971-6dd2ebee6ee1","block_type":"box","text":"financial institutions and investment funds will generally either need to (a) collect and report to the IRS detailed information","page_number":569,"box":{"x":45,"y":614,"width":861,"height":12}},{"id":"55c724bc-3b6b-47e0-8465-0acaf52a373b","block_type":"box","text":"identifying their U.S. accounts and U.S. account holders, comply","page_number":569,"box":{"x":45,"y":629,"width":447,"height":13}},{"id":"dab3a364-8dd6-4530-83b7-555abde680c1","block_type":"box","text":"with due diligence procedures for identifying U.S. accounts and","page_number":569,"box":{"x":496,"y":629,"width":439,"height":13}},{"id":"c21a6755-ee8e-4f01-b494-66b5fa60bc56","block_type":"box","text":"withhold tax on certain payments made to noncomplying foreign","page_number":569,"box":{"x":45,"y":645,"width":453,"height":12}},{"id":"5106b0ae-dd82-4040-bc9f-4a3aa709dda9","block_type":"box","text":"entities and account holders or (b) if an intergovernmental","page_number":569,"box":{"x":503,"y":645,"width":404,"height":12}},{"id":"f73075a9-6386-4949-8afb-dfa2512f4c1d","block_type":"box","text":"agreement is entered into and implementing legislation is adopt","page_number":569,"box":{"x":46,"y":660,"width":438,"height":13}},{"id":"7c9fd9fd-8d47-4702-85d3-5cb450ad7d61","block_type":"box","text":"ed, comply with the agreement and legislation. Other foreign","page_number":569,"box":{"x":484,"y":660,"width":422,"height":13}},{"id":"cccc19bb-a556-458f-9b9d-ed7aa47506f7","block_type":"box","text":"entities will generally either need to provide detailed informatio","page_number":569,"box":{"x":46,"y":676,"width":439,"height":12}},{"id":"fdd33227-89a3-4f45-8077-595122734a43","block_type":"box","text":"n identifying each substantial U.S. owner or certify there are no","page_number":569,"box":{"x":485,"y":676,"width":439,"height":12}},{"id":"8a47798c-604a-437a-9fd6-9a485be90ba8","block_type":"box","text":"such owners.","page_number":569,"box":{"x":46,"y":691,"width":89,"height":10}},{"id":"48fd0052-8e20-4465-a71a-2e49359c58c1","block_type":"box","text":"Ordinary income and capital gain dividends paid by the Funds may also be subject to state and local taxes. However, certain states","page_number":569,"box":{"x":46,"y":714,"width":907,"height":13}},{"id":"4d8bc19f-e2ae-4c5b-b298-1c9dc84b79e0","block_type":"box","text":"exempt from state income taxation dividends paid by regulated","page_number":569,"box":{"x":46,"y":730,"width":438,"height":13}},{"id":"1ef9c64f-0725-42a2-88f9-bd734e6de9b1","block_type":"box","text":"investment companies that are derived from interest on United","page_number":569,"box":{"x":489,"y":730,"width":433,"height":13}},{"id":"0390ed55-d5c6-43f0-88f0-c3c4efe10b39","block_type":"box","text":"States Treasury obligations. 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Each share of each class of Common Stock is entitled to participate equally in dividends and distributions","page_number":570,"box":{"x":45,"y":477,"width":865,"height":13}},{"id":"f1ac2137-f758-4c72-933e-e9623dd599a5","block_type":"box","text":"declared by a Fund and in the net assets of the Fund upon liquidation or dissolution after satisfaction of outstanding liabilities.","page_number":570,"box":{"x":46,"y":492,"width":875,"height":13}},{"id":"a75d3d4d-c647-49c6-a9ef-90d071c3f2c1","block_type":"box","text":"For Funds organized as Maryland corporations, the by-laws of the Fund require that a special meeting of shareholders be held","page_number":570,"box":{"x":45,"y":515,"width":875,"height":13}},{"id":"68ad9d27-58a3-4794-984e-20ffb3ee5ebc","block_type":"box","text":"upon the written request of a minimum percentage of the outstanding shares of the Fund entitled to vote at such meeting, if they","page_number":570,"box":{"x":46,"y":531,"width":889,"height":13}},{"id":"e3e24e88-40e8-4346-8724-f4a85ba2700e","block_type":"box","text":"comply with applicable Maryland law.","page_number":570,"box":{"x":45,"y":546,"width":269,"height":13}},{"id":"b0bb2175-ba5e-4ca9-92dd-cc80d94b2298","block_type":"box","text":"Certain of the Funds are organized as “Massachusetts business tr","page_number":570,"box":{"x":46,"y":570,"width":450,"height":13}},{"id":"76acafac-0fc6-4fe9-a896-3f638b4dce78","block_type":"box","text":"usts.” Under Massachusetts law, shareholders of such a trust","page_number":570,"box":{"x":497,"y":570,"width":422,"height":12}},{"id":"ed756865-3c51-4ced-b4fe-a5b4578750d8","block_type":"box","text":"may, under certain circumstances, be held personally liable as par","page_number":570,"box":{"x":45,"y":585,"width":455,"height":13}},{"id":"05f9c934-3cbb-4de4-8546-daa47dd96d1a","block_type":"box","text":"tners for its obligations. 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The Declaration of Trust also provides that a","page_number":570,"box":{"x":45,"y":647,"width":887,"height":13}},{"id":"92c060db-f48e-4759-9c84-a5b52ea096ed","block_type":"box","text":"trust may maintain appropriate insurance (for example, fide","page_number":570,"box":{"x":45,"y":663,"width":416,"height":13}},{"id":"8fe71d50-3ef7-41e8-a5f7-b2bacdec2a19","block_type":"box","text":"lity bond and errors and omissions insurance) for the protection of the","page_number":570,"box":{"x":462,"y":663,"width":488,"height":13}},{"id":"2a1da0b4-fe8f-4294-9b0f-bf7b2efffd6a","block_type":"box","text":"trust, its shareholders, trustees, officers, employees and agents covering possible tort and other liabilities. 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While NRSROs may from time to time revise such ratings, they","page_number":571,"box":{"x":501,"y":146,"width":449,"height":13}},{"id":"3ddfd1b7-2c3c-4cbf-b1e0-7b66f195585e","block_type":"box","text":"undertake no obligation to do so, and the ratings given to secu","page_number":571,"box":{"x":46,"y":162,"width":433,"height":13}},{"id":"ff9183df-ee39-4b73-8726-6e98b8a97164","block_type":"box","text":"rities at issuance do not necessarily represent ratings which would","page_number":571,"box":{"x":479,"y":162,"width":456,"height":13}},{"id":"47dacf0c-2676-4667-8fda-199298cfe09d","block_type":"box","text":"be given to these securities on a particular subsequent date.","page_number":571,"box":{"x":46,"y":177,"width":408,"height":13}},{"id":"40fbe7ec-5661-4551-8a40-bb6eb1cd3d0d","block_type":"box","text":"NRSROs may rate specific investments (e.g., bonds), issuers (e.g","page_number":571,"box":{"x":45,"y":201,"width":445,"height":13}},{"id":"eac33ded-98ab-464b-b7ae-77150a5d4fb1","block_type":"box","text":"., corporations, governments and financial institutions) and/or","page_number":571,"box":{"x":491,"y":201,"width":430,"height":13}},{"id":"ffbdaefc-0e51-4891-b92a-df9de0adf607","block_type":"box","text":"programs (e.g., commercial paper programs). However, certain t","page_number":571,"box":{"x":45,"y":216,"width":448,"height":13}},{"id":"ef856e35-f535-48a0-9ff1-d81dc6d878a3","block_type":"box","text":"ypes of investments may not be rated by NRSROs, such as certain","page_number":571,"box":{"x":494,"y":216,"width":459,"height":13}},{"id":"9be070fe-ee28-4287-9c49-9f32a18b2f54","block_type":"box","text":"government/sovereign obligations, US agency securities, commerci","page_number":571,"box":{"x":45,"y":232,"width":459,"height":13}},{"id":"78fcdddd-bcd0-4419-9dbb-22e78c24e13f","block_type":"box","text":"al paper, time deposits at financial institutions, and derivative","page_number":571,"box":{"x":505,"y":232,"width":426,"height":13}},{"id":"95797183-3631-4678-be60-af6440b2a37f","block_type":"box","text":"instruments such as credit default swaps. For these types of investments, as well as US Treasury securities (some of which are not","page_number":571,"box":{"x":45,"y":247,"width":893,"height":13}},{"id":"9f030eab-fc9b-4b1a-9eb7-2cc64194aafd","block_type":"box","text":"rated), where a NRSRO has not rated the specific investment but has rated the investment’s issuer, program, financial institution","page_number":571,"box":{"x":45,"y":263,"width":892,"height":13}},{"id":"0a1eed72-b564-42e6-902d-09dcffd804d0","block_type":"box","text":"or underlying reference asset, BlackRock Advisors, LLC, BlackRock Fund Advisors or their respective affiliates (“BlackRock”)","page_number":571,"box":{"x":46,"y":278,"width":876,"height":13}},{"id":"33beb9cc-5ac6-4401-93ae-a690f6b7e800","block_type":"box","text":"may consider the investment to have the same NRSRO rating as its","page_number":571,"box":{"x":45,"y":294,"width":466,"height":13}},{"id":"c7bfd2ab-267d-43e7-ad78-10348eb983d4","block_type":"box","text":"issuer, program, financial institution or underlying reference","page_number":571,"box":{"x":516,"y":294,"width":417,"height":13}},{"id":"bf5ced86-d2d0-4e72-a01c-c35c55aa5b37","block_type":"box","text":"asset, as applicable. In the case of municipal securities, where","page_number":571,"box":{"x":46,"y":309,"width":422,"height":13}},{"id":"21ccc12c-dd13-4add-95f6-c1c40f0559cc","block_type":"box","text":"one NRSRO provides multiple ratings for the same security (e.g.,","page_number":571,"box":{"x":474,"y":309,"width":450,"height":13}},{"id":"cead53ac-d270-409b-a759-b77c9869695c","block_type":"box","text":"“underlying,” “insured” and/or “enhanced” ratings), BlackRoc","page_number":571,"box":{"x":47,"y":325,"width":438,"height":13}},{"id":"f0d403de-3bbc-4372-b986-aad4fd1ed977","block_type":"box","text":"k may consider the security to have the highest of the multiple","page_number":571,"box":{"x":486,"y":325,"width":430,"height":13}},{"id":"b2ad4960-0b98-457a-b959-b9ada71c845b","block_type":"box","text":"ratings.","page_number":571,"box":{"x":45,"y":341,"width":51,"height":12}},{"id":"a122844f-56a6-4aad-9f2f-fe6acbb1ac17","block_type":"box","text":"New issue securities (regardless of type) may not be rated by a NRSRO at the time of their initial offering. Preliminary","page_number":571,"box":{"x":45,"y":364,"width":821,"height":13}},{"id":"323bdb81-e3f9-491c-9592-2fdd0842a437","block_type":"box","text":"prospectuses or term sheets for new issue securities may incl","page_number":571,"box":{"x":45,"y":379,"width":416,"height":13}},{"id":"fd6b17d8-3d19-43f7-b1b8-4073336ac745","block_type":"box","text":"ude an expected rating for the security (as determined by the","page_number":571,"box":{"x":462,"y":379,"width":419,"height":13}},{"id":"03b30b1a-4572-4c3a-b079-c113f3e41b22","block_type":"box","text":"underwriter and/or issuer) or a NRSRO rating for the issuer of the security. If applicable, when deciding whether to purchase a","page_number":571,"box":{"x":46,"y":395,"width":880,"height":13}},{"id":"a641f861-918a-435b-bbb0-c3dff35a757d","block_type":"box","text":"new issue security that has not yet been rated by a NRSRO, BlackRock may attribute an expected rating to the security based on:","page_number":571,"box":{"x":45,"y":410,"width":898,"height":13}},{"id":"3308f6d5-9a36-42bf-81ad-95341feac283","block_type":"box","text":"(i) the expected rating of the security set forth in the preliminary p","page_number":571,"box":{"x":46,"y":426,"width":457,"height":13}},{"id":"a25b0845-3e38-4305-a475-6c2a07ac110d","block_type":"box","text":"rospectus or term sheet for the security; (ii) the NRSRO’s rating","page_number":571,"box":{"x":504,"y":426,"width":442,"height":13}},{"id":"5f1ff95f-b1b5-4037-be01-9df3294b30cb","block_type":"box","text":"for the issuer of the security set forth in the preliminary pro","page_number":571,"box":{"x":45,"y":441,"width":412,"height":13}},{"id":"8780ccc7-a98e-4b34-867a-28c0328b7fe2","block_type":"box","text":"spectus or term sheet for the security; or (iii) with respect to asset","page_number":571,"box":{"x":458,"y":441,"width":455,"height":13}},{"id":"ce136474-0b78-4a60-a4ec-841f2aaeba2c","block_type":"box","text":"backed securities, the rating of a prior issuance","page_number":571,"box":{"x":46,"y":457,"width":323,"height":13}},{"id":"f8d55802-150c-4776-8ba0-6fc67ed477f2","block_type":"box","text":"having a similar structure or the same sponsor.","page_number":571,"box":{"x":374,"y":457,"width":324,"height":13}},{"id":"4bdc642e-3773-4653-a760-7e59b62a1f8d","block_type":"box","text":"Where the investment objective of a fund is to track the performance of an index that includes credit ratings eligibility criteria as","page_number":571,"box":{"x":45,"y":480,"width":888,"height":13}},{"id":"39d90ce6-9d4b-4e4e-8cca-d381580a45b0","block_type":"box","text":"part of its index methodology, the fund may purchase any security within the index, such security having been determined by the","page_number":571,"box":{"x":45,"y":496,"width":895,"height":13}},{"id":"7b157453-962f-4731-9b26-a04f6b36c607","block_type":"box","text":"index provider as meeting its credit ratings eligibility criteria. The credit ratings practices of an index provider may differ from","page_number":571,"box":{"x":45,"y":511,"width":874,"height":13}},{"id":"2d6e38c6-f52f-4195-8082-e68573027576","block_type":"box","text":"BlackRock’s practices, as described above. Further, the fund may invest, directly or indirectly, in securities that are not rated by a","page_number":571,"box":{"x":46,"y":527,"width":894,"height":13}},{"id":"b5fbc865-c5f6-45f5-9714-5bdeea0f8ed0","block_type":"box","text":"rating agency or securities with a credit rating that differs from the credit rating specified in its index methodology in various","page_number":571,"box":{"x":45,"y":542,"width":865,"height":13}},{"id":"baedd7c0-c3a5-449f-8b99-a7a2579985b9","block_type":"box","text":"circumstances, including where a security is downgraded but not yet removed from an index, following the removal of a security","page_number":571,"box":{"x":45,"y":558,"width":892,"height":13}},{"id":"2a415d73-ac35-4a1f-92be-c5e2911f34a7","block_type":"box","text":"from an index prior to its sale by the fund or as a result of a corporate action or restructuring affecting an issuer of a security held","page_number":571,"box":{"x":45,"y":573,"width":900,"height":13}},{"id":"77d4425e-b885-4a7d-887e-912361c1dcac","block_type":"box","text":"by the fund.","page_number":571,"box":{"x":46,"y":589,"width":82,"height":13}},{"id":"a1228096-baf1-482f-bc39-e5f57ea23a30","block_type":"box","text":"Fixed-income securities which are unrated may expose the investor to risks with respect to capacity to pay interest or repay","page_number":571,"box":{"x":45,"y":612,"width":854,"height":13}},{"id":"f537f728-9b0f-4175-9bbc-159c1c51a445","block_type":"box","text":"principal which are similar to the risks of lower-rated speculative bonds. Evaluation of these securities is dependent on","page_number":571,"box":{"x":45,"y":628,"width":820,"height":12}},{"id":"49002cf5-1a32-4731-9be1-4ec3f8610b84","block_type":"box","text":"BlackRock’s judgment, analysis and experience in the evaluation of such securities.","page_number":571,"box":{"x":46,"y":643,"width":573,"height":13}},{"id":"57e2542e-60ab-4466-b1e0-c8fd97ee0539","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 recent developments","page_number":571,"box":{"x":45,"y":667,"width":900,"height":12}},{"id":"7dfe7ce1-bb2c-4cd1-a02c-c34447e4ceb5","block_type":"box","text":"on the issuer’s ability to make interest and principal payments or on the likelihood of default.","page_number":571,"box":{"x":46,"y":682,"width":645,"height":13}},{"id":"fe4d69f4-b51e-4671-8d28-ca39161febf6","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 Fitch.","page_number":571,"box":{"x":46,"y":706,"width":831,"height":12}},{"id":"c8e6e514-1aaf-4bda-a271-dfd633b001eb","block_type":"box","text":"The descriptions below relate to general long-term and short-term obligations of an issuer.","page_number":571,"box":{"x":45,"y":729,"width":626,"height":13}},{"id":"fb740284-9459-4768-b18f-05f758b8bc37","block_type":"box","text":"A Description of Moody’s Investors Service, Inc.’s (“Moody’s”) Global Rating Scales","page_number":571,"box":{"x":45,"y":758,"width":618,"height":13}},{"id":"d1e10a42-6e3d-405b-bb81-0a396e875552","block_type":"box","text":"Ratings assigned on Moody’s global long-term and short-term rating scales are forward-looking opinions of the relative credit","page_number":571,"box":{"x":46,"y":784,"width":874,"height":13}},{"id":"d6ab53d5-77f8-4375-9aef-77c6ea439669","block_type":"box","text":"risks of financial obligations issued by non-financial corporates,","page_number":571,"box":{"x":45,"y":799,"width":442,"height":13}},{"id":"3f981cac-4543-43e5-ae22-c4e6cb52fedd","block_type":"box","text":"financial institutions, structured finance vehicles, project finance","page_number":571,"box":{"x":493,"y":799,"width":444,"height":13}},{"id":"b70dc431-a664-4544-a29f-1511e0558b03","block_type":"box","text":"vehicles, and public sector entities. Moody’s defines credit risk as th","page_number":571,"box":{"x":45,"y":815,"width":469,"height":13}},{"id":"4d28e7e2-0eba-4cdc-80a1-29b11f8b53df","block_type":"box","text":"e risk that an entity may not meet its contractual financial","page_number":571,"box":{"x":515,"y":815,"width":400,"height":13}},{"id":"7f175945-f2de-4f26-9336-f053e9f886a7","block_type":"box","text":"obligations as they come due and any estimated financial loss in th","page_number":571,"box":{"x":46,"y":830,"width":461,"height":13}},{"id":"ff0e8117-ecad-45a7-ab39-1b457d2b21d5","block_type":"box","text":"e event of default or impairment. The contractual financial","page_number":571,"box":{"x":507,"y":830,"width":407,"height":13}},{"id":"66361192-d09a-4e03-bb83-c6e0160a0fde","block_type":"box","text":"obligations addressed by Moody’s ratings are those that call for, without regard to enforceability, the payment of an ascertainable","page_number":571,"box":{"x":46,"y":846,"width":900,"height":13}},{"id":"ff8bb7f9-85a3-4b2c-b72c-7460cd6a8e2b","block_type":"box","text":"amount, which may vary based upon standard sources of variation (e.g., floating interest rates), by an ascertainable date. Moody’s","page_number":571,"box":{"x":46,"y":861,"width":904,"height":13}},{"id":"0181c58c-9b79-488a-adbe-3da5fb1dc3f2","block_type":"box","text":"rating addresses the issuer’s ability to obtain cash sufficient to serv","page_number":571,"box":{"x":45,"y":877,"width":460,"height":13}},{"id":"5c9f3653-b994-46d4-8ac8-260fbee9d702","block_type":"box","text":"ice the obligation, and its willingness to pay. Moody’s ratings do","page_number":571,"box":{"x":505,"y":877,"width":448,"height":13}},{"id":"a146dd4c-d063-4204-abe7-123614ad0093","block_type":"box","text":"A-1","page_number":571,"box":{"x":486,"y":916,"width":25,"height":10}},{"id":"abd88d6c-0f1d-42fd-9d46-a4d175d58d6b","block_type":"box","text":"NM1026U-6004382-571/605","page_number":571,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5e60f193-1e21-445f-a06e-85d912f0dda3","block_type":"box","text":"not address non-standard sources of variation in the amount of the principal obligation (e.g., equity indexed), absent an express","page_number":572,"box":{"x":45,"y":79,"width":886,"height":13}},{"id":"98426909-30b3-4ab7-951e-bf8228e2356e","block_type":"box","text":"statement to the contrary in a press release accompanying an initia","page_number":572,"box":{"x":46,"y":94,"width":460,"height":13}},{"id":"e11e4401-487a-4228-8b54-a983633d6337","block_type":"box","text":"l rating. Long-term ratings are assigned to issuers or obligations","page_number":572,"box":{"x":507,"y":94,"width":441,"height":13}},{"id":"eb6b01d0-25bb-4c42-a8fc-26e87bbddbb7","block_type":"box","text":"with an original maturity of one year or more and reflect both on the likelihood of a default or impairment on contractual","page_number":572,"box":{"x":45,"y":110,"width":848,"height":13}},{"id":"74e6ad4b-0d64-4e86-a943-a9e9da62f7f1","block_type":"box","text":"financial obligations and the expected financial loss suffered in th","page_number":572,"box":{"x":45,"y":125,"width":453,"height":13}},{"id":"13e8d93b-0edd-487d-8cd3-092d49de007f","block_type":"box","text":"e event of default or impairment. Short-term ratings are assigned","page_number":572,"box":{"x":499,"y":125,"width":448,"height":13}},{"id":"74185b53-872c-4034-905f-383a7aefaba5","block_type":"box","text":"for obligations with an original maturity of thirteen months or less and reflect both on the likelihood of a default or impairment","page_number":572,"box":{"x":45,"y":141,"width":887,"height":13}},{"id":"61df73ff-9bb2-40a3-9362-195c0ac78983","block_type":"box","text":"on contractual financial obligations and the expected financial","page_number":572,"box":{"x":46,"y":156,"width":431,"height":13}},{"id":"bb423f38-d169-4bd8-82f7-169d830adcee","block_type":"box","text":"loss suffered in the event of default or impairment. Moody’s issues","page_number":572,"box":{"x":482,"y":156,"width":460,"height":13}},{"id":"7f8f0257-7c1a-4184-aa9b-af739167fa7b","block_type":"box","text":"ratings at the issuer level and instrument level on both the long-term scale and the short-term scale. Typically, ratings are made","page_number":572,"box":{"x":45,"y":172,"width":879,"height":13}},{"id":"6198d8f7-0042-461c-96d4-622a85a37562","block_type":"box","text":"publicly available although private and unpublished ratings may also be assigned.","page_number":572,"box":{"x":45,"y":187,"width":565,"height":13}},{"id":"d5ee64b1-ab25-4e75-8830-f111fac8f1f8","block_type":"box","text":"Moody’s differentiates structured finance ratings from fundament","page_number":572,"box":{"x":45,"y":211,"width":456,"height":12}},{"id":"49b4ef34-9c74-4d7b-a32d-595d20c6a5bf","block_type":"box","text":"al ratings (i.e., ratings on nonfinancial corporate, financial","page_number":572,"box":{"x":502,"y":211,"width":403,"height":12}},{"id":"218281ca-050c-4f69-a24e-cd29a736a3d7","block_type":"box","text":"institution, and public sector entities) on the global long-term scale by","page_number":572,"box":{"x":45,"y":226,"width":484,"height":13}},{"id":"08d1da3b-630a-473a-b230-ccbb4743273b","block_type":"box","text":"adding (sf) to all structured finance ratings. The addition of","page_number":572,"box":{"x":534,"y":226,"width":413,"height":13}},{"id":"3ce157ef-a8b1-45d9-ad6d-51ff9e75928f","block_type":"box","text":"(sf) to structured finance ratings should eliminate any presumptio","page_number":572,"box":{"x":46,"y":242,"width":452,"height":12}},{"id":"521dd017-6fdb-4ab2-8e3b-5f5f82dd9386","block_type":"box","text":"n that such ratings and fundamental ratings at the same letter","page_number":572,"box":{"x":499,"y":242,"width":426,"height":12}},{"id":"5f583ab7-3ebb-482c-aaad-f346b3efe79d","block_type":"box","text":"grade level will behave the same. The (sf) indicator for structured","page_number":572,"box":{"x":45,"y":257,"width":452,"height":13}},{"id":"0a0aaefa-bfff-4003-9dfd-105d82a9fad1","block_type":"box","text":"finance security ratings indicates that otherwise similarly rated","page_number":572,"box":{"x":502,"y":257,"width":432,"height":13}},{"id":"138c1336-9503-4444-91bf-a27762394a77","block_type":"box","text":"structured finance and fundamental securities may have different risk characteristics. Through its current methodologies, however,","page_number":572,"box":{"x":46,"y":273,"width":904,"height":12}},{"id":"491ef8db-e159-42f2-a724-351df873f22b","block_type":"box","text":"Moody’s aspires to achieve broad expected equivalence in structured finance and fundamental rating performance when measured","page_number":572,"box":{"x":45,"y":288,"width":905,"height":13}},{"id":"43e12817-2f83-4d41-afdd-c4e613bef5cf","block_type":"box","text":"over a long period of time.","page_number":572,"box":{"x":46,"y":304,"width":183,"height":12}},{"id":"d515d6cc-0827-4c0b-b718-965bc92edfc1","block_type":"box","text":"Description of Moody’s Global Long-Term Rating Scale","page_number":572,"box":{"x":45,"y":332,"width":410,"height":13}},{"id":"1d87a62e-550d-495a-904c-ddb43feab2e3","block_type":"box","text":"Aaa Obligations rated Aaa are judged to be of the highest quality, subject to the lowest level of credit risk.","page_number":572,"box":{"x":45,"y":357,"width":890,"height":12}},{"id":"bf6e5121-5610-471c-a3cb-1730a9673b04","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":572,"box":{"x":45,"y":376,"width":820,"height":13}},{"id":"d26bb451-67b6-4931-9cb3-20b8f74a4866","block_type":"box","text":"A Obligations rated A are judged to be upper-medium grade and are subject to low credit risk.","page_number":572,"box":{"x":45,"y":395,"width":821,"height":13}},{"id":"36589e9f-182b-4862-9574-63fd3dd24e6e","block_type":"box","text":"Baa Obligations rated Baa are judged to be medium-grade and subject to moderate credit risk and as such","page_number":572,"box":{"x":46,"y":415,"width":887,"height":12}},{"id":"e3b2c799-a827-4ec5-b381-779e22087676","block_type":"box","text":"may possess certain speculative characteristics.","page_number":572,"box":{"x":197,"y":429,"width":337,"height":13}},{"id":"54996c7f-4c85-49e1-9dd4-aa3457b9af5f","block_type":"box","text":"Ba Obligations rated Ba are judged to be speculative and are subject to substantial credit risk.","page_number":572,"box":{"x":46,"y":448,"width":806,"height":13}},{"id":"8e7cbbf7-a3f6-4fe6-9950-4f1fe2d91649","block_type":"box","text":"B Obligations rated B are considered speculative and are subject to high credit risk.","page_number":572,"box":{"x":46,"y":468,"width":739,"height":12}},{"id":"c52549be-19f3-4969-90c1-5e045d4ac579","block_type":"box","text":"Caa Obligations rated Caa are judged to be speculative of poor standing and are subject to very high credit","page_number":572,"box":{"x":46,"y":487,"width":895,"height":13}},{"id":"a5b8dc21-e3eb-4c81-8235-b3d98fd70176","block_type":"box","text":"risk.","page_number":572,"box":{"x":197,"y":501,"width":30,"height":10}},{"id":"7981bf4b-0823-4327-ae87-a831a07bc9f8","block_type":"box","text":"Ca Obligations rated Ca are highly speculative and are likely in, or very near, default, with some prospect","page_number":572,"box":{"x":46,"y":521,"width":894,"height":12}},{"id":"b4c40317-7575-4fcd-a177-5c8bc011c640","block_type":"box","text":"of recovery of principal and interest.","page_number":572,"box":{"x":197,"y":535,"width":263,"height":13}},{"id":"e68577e1-d7a2-48b6-83c1-ff175cbed491","block_type":"box","text":"C Obligations rated C are the lowest rated and are typically in default, with little prospect for recovery of","page_number":572,"box":{"x":46,"y":554,"width":902,"height":13}},{"id":"d98effa7-74f4-4a5c-8c52-f113dae1b6aa","block_type":"box","text":"principal or interest.","page_number":572,"box":{"x":197,"y":568,"width":146,"height":13}},{"id":"2b4bb054-44ae-4c7f-8c28-27382ee3a91c","block_type":"box","text":"Note","page_number":572,"box":{"x":45,"y":593,"width":35,"height":9}},{"id":"588e9ed8-13c5-4ee6-b259-554de7664725","block_type":"box","text":": Moody’s appends numerical modifiers 1, 2, and 3 to each generic rating classification from Aa through Caa. The modifier 1","page_number":572,"box":{"x":81,"y":592,"width":868,"height":12}},{"id":"22fcc5f6-59fb-47bc-a26f-2e844bc43bdf","block_type":"box","text":"indicates that the obligation ranks in the higher end of its generic rating category; the modifier 2 indicates a mid-range ranking;","page_number":572,"box":{"x":45,"y":607,"width":881,"height":13}},{"id":"aae2b1b0-2455-41cd-8824-f93a5fa8e2f5","block_type":"box","text":"and the modifier 3 indicates a ranking in the lower end of that generic rating category. Additionally, a “(hyb)” indicator is","page_number":572,"box":{"x":46,"y":623,"width":847,"height":13}},{"id":"3fd691ee-056a-4c4e-b2ea-6e41f75587da","block_type":"box","text":"appended to all ratings of hybrid securities issued by banks, insurers, finance companies, and securities firms.","page_number":572,"box":{"x":46,"y":638,"width":754,"height":13}},{"id":"3ed889ef-3563-44fc-829e-8f1ce416f5ee","block_type":"box","text":"By their terms, hybrid securities allow for the omission of sche","page_number":572,"box":{"x":46,"y":661,"width":431,"height":13}},{"id":"103948d6-0fbb-4d8e-b6e0-4628cbb2480b","block_type":"box","text":"duled dividends, interest, or principal payments, which can","page_number":572,"box":{"x":478,"y":661,"width":408,"height":13}},{"id":"6cedd5f9-049b-4178-a257-3289fedd5ee7","block_type":"box","text":"potentially result in impairment if such an omission occurs. Hybrid","page_number":572,"box":{"x":45,"y":677,"width":465,"height":13}},{"id":"6b1adc61-fc06-4e30-9c63-1538d26dce13","block_type":"box","text":"securities may also be subject to contractually allowable write","page_number":572,"box":{"x":516,"y":677,"width":433,"height":13}},{"id":"49a20068-0c93-438d-b10f-e7a0b46846a3","block_type":"box","text":"downs of principal that could result in impairment. Together with","page_number":572,"box":{"x":46,"y":692,"width":458,"height":13}},{"id":"141067e2-e056-40d5-9592-aa174e022946","block_type":"box","text":"the hybrid indicator, the long-term obligation rating assigned to","page_number":572,"box":{"x":508,"y":692,"width":443,"height":13}},{"id":"c23b11d1-deba-4d62-9491-d94ee1df1e94","block_type":"box","text":"a hybrid security is an expression of the relative credit risk associated with that security.","page_number":572,"box":{"x":46,"y":708,"width":607,"height":13}},{"id":"ab500661-a674-417f-8941-b1089852bfc0","block_type":"box","text":"Description of Moody’s Global Short-Term Rating Scale","page_number":572,"box":{"x":45,"y":736,"width":412,"height":13}},{"id":"81845642-79f0-43f4-9bb6-c52bb2ddb72e","block_type":"box","text":"P-1 Ratings of Prime-1 reflect a superior ability to repay short-term obligations.","page_number":572,"box":{"x":45,"y":761,"width":701,"height":13}},{"id":"1a812d5a-7ee7-47ad-a175-0f60dbf09d4d","block_type":"box","text":"P-2 Ratings of Prime-2 reflect a strong ability to repay short-term obligations.","page_number":572,"box":{"x":45,"y":780,"width":687,"height":13}},{"id":"7e7b4693-06ae-461b-935f-5eeb45ef0298","block_type":"box","text":"P-3 Ratings of Prime-3 reflect an acceptable ability to repay short-term obligations.","page_number":572,"box":{"x":45,"y":800,"width":726,"height":13}},{"id":"8d0b20bd-75d9-4792-abbe-b74172f73bb4","block_type":"box","text":"NP Issuers (or supporting institutions) rated Not Prime do not fall within any of the Prime rating","page_number":572,"box":{"x":45,"y":819,"width":829,"height":13}},{"id":"086a566e-b0d0-4e76-9d96-da84e16c31ec","block_type":"box","text":"categories.","page_number":572,"box":{"x":197,"y":834,"width":75,"height":12}},{"id":"dc211017-bd73-4ab4-af47-ee2aef692f0d","block_type":"box","text":"A-2","page_number":572,"box":{"x":486,"y":916,"width":26,"height":10}},{"id":"85b3f7d0-ac26-445b-bdad-9da8509d3300","block_type":"box","text":"NM1026U-6004382-572/605","page_number":572,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"0b900a35-f08d-40cf-a4ed-3e6cf040039d","block_type":"box","text":"Description of Moody’s U.S. Municipal Short-Term Debt and Demand Obligation Ratings","page_number":573,"box":{"x":45,"y":79,"width":660,"height":13}},{"id":"83463db6-d41a-4b51-9feb-f49a4ffcf548","block_type":"box","text":"Description of Moody’s Short-Term Obligation Ratings","page_number":573,"box":{"x":45,"y":103,"width":406,"height":13}},{"id":"3c682015-f0cd-47f0-b9bd-1d6206e34534","block_type":"box","text":"Moody’s uses the global short-term Prime rating scale for commercial paper issued by U.S. municipalities and nonprofits. These","page_number":573,"box":{"x":45,"y":125,"width":886,"height":13}},{"id":"36af0bf1-d48d-4017-b0e9-82efcf49a53f","block_type":"box","text":"commercial paper programs may be backed by external letters of","page_number":573,"box":{"x":45,"y":141,"width":452,"height":13}},{"id":"3802908b-c337-42f3-9954-d2387298a1a7","block_type":"box","text":"credit or liquidity facilities, or by an issuer’s self-liquidity.","page_number":573,"box":{"x":501,"y":141,"width":397,"height":13}},{"id":"b1d6e5c0-e7c2-42d6-a187-fa94ab124c38","block_type":"box","text":"For other short-term municipal obligations, Moody’s uses one","page_number":573,"box":{"x":45,"y":163,"width":431,"height":13}},{"id":"1500029f-649f-4dfd-91e6-afc05361c4b8","block_type":"box","text":"of two other short-term rating scales, the Municipal Investment","page_number":573,"box":{"x":481,"y":163,"width":440,"height":13}},{"id":"ac3893d3-f2a0-411d-a832-0e455534a2da","block_type":"box","text":"Grade (“MIG”) and Variable Municipal Investment Grade (“VMIG”) scales discussed below.","page_number":573,"box":{"x":46,"y":179,"width":650,"height":12}},{"id":"befd4496-b050-4fc7-b237-7237e23162e4","block_type":"box","text":"Moody’s uses the MIG scale for U.S. municipal cash flow notes, bond anticipation notes and certain other short-term obligations,","page_number":573,"box":{"x":45,"y":201,"width":900,"height":12}},{"id":"a269f951-9d27-48f3-a2b7-355f00607f6b","block_type":"box","text":"which typically mature in three years or less. Under certain ci","page_number":573,"box":{"x":45,"y":216,"width":424,"height":13}},{"id":"2a6b748f-b91f-4ae7-ac52-e2e435243444","block_type":"box","text":"rcumstances, Moody’s uses the MIG scale for bond anticipation","page_number":573,"box":{"x":469,"y":216,"width":444,"height":13}},{"id":"443ea4e8-4a44-4df5-8a5b-d5913b67cb86","block_type":"box","text":"notes with maturities of up to five years.","page_number":573,"box":{"x":45,"y":232,"width":279,"height":12}},{"id":"29f913fc-b431-4641-9f1f-c40e47e7ad80","block_type":"box","text":"MIG Scale","page_number":573,"box":{"x":45,"y":261,"width":73,"height":10}},{"id":"02ae4b14-410e-437b-ae9a-1afe85636b23","block_type":"box","text":"MIG 1 This designation denotes superior credit quality. Excellent protection is afforded by established cash","page_number":573,"box":{"x":45,"y":284,"width":878,"height":12}},{"id":"2f41daf4-3aea-42ed-9725-db28c6df094e","block_type":"box","text":"flows, highly reliable liquidity support, or demonstrated broad-based access to the market for","page_number":573,"box":{"x":197,"y":298,"width":679,"height":13}},{"id":"d58bfdad-60ed-4ac1-bcac-66f3621540a9","block_type":"box","text":"refinancing.","page_number":573,"box":{"x":197,"y":312,"width":84,"height":13}},{"id":"2960d098-5eef-42e6-8dc9-82d8fd81237f","block_type":"box","text":"MIG 2 This designation denotes strong credit quality. Margins of protection are ample, although not as large","page_number":573,"box":{"x":45,"y":331,"width":891,"height":13}},{"id":"7d916027-3690-4954-9d49-f358fdf836c1","block_type":"box","text":"as in the preceding group.","page_number":573,"box":{"x":197,"y":346,"width":187,"height":13}},{"id":"08a2a750-e018-40db-8fb1-e1dc885b091c","block_type":"box","text":"MIG 3 This designation denotes acceptable credit quality. Liquidity and cash-flow protection may be narrow,","page_number":573,"box":{"x":45,"y":365,"width":894,"height":13}},{"id":"0ead4317-4d85-4c02-afcd-be0020041e77","block_type":"box","text":"and market access for refinancing is likely to be less well-established.","page_number":573,"box":{"x":197,"y":379,"width":499,"height":13}},{"id":"144c0cd8-9745-47db-8246-321421d99853","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Debt instruments in this category may lack","page_number":573,"box":{"x":46,"y":399,"width":883,"height":12}},{"id":"de66b16a-9204-4972-a1af-4691e99f123d","block_type":"box","text":"sufficient margins of protection.","page_number":573,"box":{"x":197,"y":413,"width":231,"height":13}},{"id":"039cb3df-b793-4f37-9c47-b0b034d233af","block_type":"box","text":"Description of Moody’s Demand Obligation Ratings","page_number":573,"box":{"x":45,"y":439,"width":382,"height":13}},{"id":"ef4ce7d5-a744-4d44-a86b-81fc6a1fa511","block_type":"box","text":"In the case of variable rate demand obligations (“VRDOs”), a","page_number":573,"box":{"x":45,"y":464,"width":430,"height":13}},{"id":"4da19fcb-1fd0-4d73-8d4a-a9044cd2c7d5","block_type":"box","text":"two-component rating is assigned. The components are a long-term","page_number":573,"box":{"x":480,"y":464,"width":469,"height":13}},{"id":"b4aab068-a92f-4618-addd-d569e9c8f758","block_type":"box","text":"rating and a short-term demand obligation rating. The long-term","page_number":573,"box":{"x":45,"y":479,"width":451,"height":13}},{"id":"1a098163-ef67-4671-8871-bff119c94c71","block_type":"box","text":"rating addresses the issuer’s ability to meet scheduled principal","page_number":573,"box":{"x":500,"y":479,"width":433,"height":13}},{"id":"b4001d98-7f70-47c0-a94c-ea3995c7ce01","block_type":"box","text":"and interest payments. The short-term demand obligation ratin","page_number":573,"box":{"x":46,"y":495,"width":437,"height":13}},{"id":"e524f5c8-11ce-49d7-b9cb-4e01a3463005","block_type":"box","text":"g addresses the ability of the issuer or the liquidity provider to","page_number":573,"box":{"x":484,"y":495,"width":429,"height":13}},{"id":"aa253d23-0e7c-46cf-87e6-25981353c871","block_type":"box","text":"make payments associated with the purchase-price-upon-de","page_number":573,"box":{"x":45,"y":510,"width":413,"height":13}},{"id":"df4b485b-6680-40b0-b494-ed9ae01da985","block_type":"box","text":"mand feature (“demand feature”) of the VRDO. The short-term","page_number":573,"box":{"x":459,"y":510,"width":446,"height":13}},{"id":"4d5e0840-c4ab-4110-b5a9-f5bea784e23a","block_type":"box","text":"demand obligation rating uses the VMIG scale. VMIG ratings","page_number":573,"box":{"x":46,"y":526,"width":429,"height":13}},{"id":"4bd474ae-76e5-4f44-8636-4c5923ae292a","block_type":"box","text":"with liquidity support use as an input the short-term Counterparty","page_number":573,"box":{"x":480,"y":526,"width":462,"height":13}},{"id":"ba23358a-67c4-402b-a485-4dc79ba99244","block_type":"box","text":"Risk Assessment of the support provider, or the long-term rating of t","page_number":573,"box":{"x":46,"y":541,"width":476,"height":13}},{"id":"ad87721b-1607-4a6c-bacf-e35a255f78a0","block_type":"box","text":"he underlying obligor in the absence of third party liquidity","page_number":573,"box":{"x":522,"y":541,"width":411,"height":13}},{"id":"215131a2-1a18-4a69-bc0a-3613a2247b88","block_type":"box","text":"support. Transitions of VMIG ratings of demand obligations with conditional liquidity support differ from transitions on the","page_number":573,"box":{"x":46,"y":557,"width":867,"height":13}},{"id":"fd33d456-08aa-495b-bf7e-799d0a565e04","block_type":"box","text":"Prime scale to reflect the risk that external liquidity support will terminate if the issuer’s long-term rating drops below investment","page_number":573,"box":{"x":45,"y":572,"width":896,"height":13}},{"id":"1ebca7ac-b522-4364-a8af-b267fdb2e0c5","block_type":"box","text":"grade.","page_number":573,"box":{"x":45,"y":588,"width":42,"height":13}},{"id":"eea6259a-d667-4d06-a8b4-342c263a4a26","block_type":"box","text":"Moody’s typically assigns the VMIG short-term demand obligation rating if the frequency of the demand feature is less than every","page_number":573,"box":{"x":45,"y":610,"width":903,"height":13}},{"id":"7a47f8d5-92b9-468f-88bb-2b8160a8c5fd","block_type":"box","text":"three years. If the frequency of the demand feature is less than three years but the purchase price is payable only with remarketing","page_number":573,"box":{"x":45,"y":626,"width":899,"height":12}},{"id":"d54a92a9-e74b-4915-835a-0f21048dafd7","block_type":"box","text":"proceeds, the short-term demand obligation rating is “NR”.","page_number":573,"box":{"x":45,"y":641,"width":416,"height":13}},{"id":"b5244e4e-bbcb-43f1-a66d-df1df062d1f9","block_type":"box","text":"VMIG Scale","page_number":573,"box":{"x":45,"y":669,"width":85,"height":9}},{"id":"b99399bf-d1f2-45b3-8627-00479f2506d9","block_type":"box","text":"VMIG 1 This designation denotes superior credit quality. Excellent protection is afforded by the superior short","page_number":573,"box":{"x":45,"y":691,"width":897,"height":13}},{"id":"201f1d1b-0755-4ad3-92f7-189752a041d8","block_type":"box","text":"term credit strength of the liquidity provider and structural and legal protections that ensure the timely","page_number":573,"box":{"x":197,"y":705,"width":747,"height":13}},{"id":"f8556d22-6650-47e4-95e0-22f0ad6503c0","block_type":"box","text":"payment of purchase price upon demand.","page_number":573,"box":{"x":197,"y":719,"width":300,"height":13}},{"id":"013444ff-bb36-41f9-8a36-ac0303fe260e","block_type":"box","text":"VMIG 2 This designation denotes strong credit quality. Good protection is afforded by the strong short-term","page_number":573,"box":{"x":45,"y":739,"width":877,"height":12}},{"id":"8b0f3999-78de-4334-933c-aae74f30115c","block_type":"box","text":"credit strength of the liquidity provider and structural and legal protections that ensure the timely","page_number":573,"box":{"x":197,"y":753,"width":709,"height":13}},{"id":"79517e6a-4964-4723-8954-40f5eea083a5","block_type":"box","text":"payment of purchase price upon demand.","page_number":573,"box":{"x":197,"y":767,"width":300,"height":13}},{"id":"16343a20-5c85-432f-9640-1394a4f3dd1c","block_type":"box","text":"VMIG 3 This designation denotes acceptable credit quality. Adequate protection is afforded by the satisfactory","page_number":573,"box":{"x":45,"y":786,"width":891,"height":13}},{"id":"5683d5da-8a8e-46c9-b673-9c2b14814695","block_type":"box","text":"short-term credit strength of the liquidity provider and structural and legal protections that ensure the","page_number":573,"box":{"x":197,"y":801,"width":740,"height":12}},{"id":"01f7bda5-d701-44c0-8783-b820a48080fe","block_type":"box","text":"timely payment of purchase price upon demand.","page_number":573,"box":{"x":197,"y":815,"width":349,"height":13}},{"id":"89fd1168-3052-4b28-a17d-05eabec2f7bf","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Demand features rated in this category may","page_number":573,"box":{"x":46,"y":834,"width":888,"height":13}},{"id":"d33c57a8-94ce-468f-96ad-62730bc3fa93","block_type":"box","text":"be supported by a liquidity provider that does not have a sufficiently strong short-term rating or may","page_number":573,"box":{"x":197,"y":848,"width":734,"height":13}},{"id":"8c52483b-105a-4caa-9ce0-2f1faff6e1b0","block_type":"box","text":"lack the structural or legal protections necessary to ensure the timely payment of purchase price upon","page_number":573,"box":{"x":197,"y":863,"width":736,"height":12}},{"id":"d9a64c73-476b-491f-9e56-e333b50d86a4","block_type":"box","text":"demand.","page_number":573,"box":{"x":197,"y":877,"width":61,"height":10}},{"id":"c2e5b4bb-23b3-42f9-a1b2-5b1343d0f6fe","block_type":"box","text":"A-3","page_number":573,"box":{"x":486,"y":916,"width":26,"height":10}},{"id":"a24d4eec-d129-4110-b947-9a1fe0e84e5c","block_type":"box","text":"NM1026U-6004382-573/605","page_number":573,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"288b9df0-dc3a-4701-967e-564599ff5814","block_type":"box","text":"Description of S&P Global Ratings (“S&P”), a Division of S&P Global Inc., Issue Credit Ratings","page_number":574,"box":{"x":45,"y":79,"width":708,"height":13}},{"id":"f6133622-22b9-49e5-9ad0-bb5f6ad4ce82","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 specific","page_number":574,"box":{"x":45,"y":105,"width":848,"height":12}},{"id":"3f1baaf1-effb-4676-9730-8cb1992022b8","block_type":"box","text":"financial obligation, a specific class of financial obligations","page_number":574,"box":{"x":45,"y":120,"width":407,"height":13}},{"id":"5bdae1a9-79b1-4870-a596-c36e39011533","block_type":"box","text":", or a specific financial program (including ratings on medium-term","page_number":574,"box":{"x":453,"y":120,"width":466,"height":13}},{"id":"b5fa1ac6-ca72-49db-8cda-4f7da6ddc78e","block_type":"box","text":"note programs and commercial paper programs). It takes into c","page_number":574,"box":{"x":45,"y":136,"width":440,"height":12}},{"id":"c1cb6e8f-78eb-4047-bbbd-dd4955682495","block_type":"box","text":"onsideration the creditworthiness of guarantors, insurers, or other","page_number":574,"box":{"x":486,"y":136,"width":457,"height":12}},{"id":"ac650cbb-d4fe-4b0c-858b-a311827f2cbe","block_type":"box","text":"forms of credit enhancement on the obligation and takes into a","page_number":574,"box":{"x":45,"y":151,"width":437,"height":13}},{"id":"c29392a7-e34f-4af4-af89-a64172d96a9c","block_type":"box","text":"ccount the currency in which the obligation is denominated. The","page_number":574,"box":{"x":482,"y":151,"width":448,"height":13}},{"id":"c4efde45-d90c-4324-900e-603ffd54e9b1","block_type":"box","text":"opinion reflects S&P’s view of the obligor’s capacity and willin","page_number":574,"box":{"x":46,"y":167,"width":436,"height":12}},{"id":"8d2c68b5-f3ae-486f-b987-bcab7ce68c3b","block_type":"box","text":"gness to meet its financial commitments as they come due, and this","page_number":574,"box":{"x":482,"y":167,"width":463,"height":12}},{"id":"58649bac-d1aa-4911-82b0-65f23d863197","block_type":"box","text":"opinion may assess terms, such as collateral security and subordi","page_number":574,"box":{"x":46,"y":182,"width":447,"height":13}},{"id":"6233b572-bedd-4206-87d0-2af446fb57bd","block_type":"box","text":"nation, which could affect ultimate payment in the event of","page_number":574,"box":{"x":494,"y":182,"width":411,"height":13}},{"id":"5bfac8be-a21e-4214-aa4c-494763515ccd","block_type":"box","text":"default.","page_number":574,"box":{"x":46,"y":198,"width":51,"height":10}},{"id":"38bf6854-5b99-4b72-8231-8b16fd435e30","block_type":"box","text":"Issue credit ratings can be either long-term or short-term. Short-term","page_number":574,"box":{"x":45,"y":221,"width":476,"height":13}},{"id":"a8877caf-4528-45dd-8c3a-ee0b1fac1e5d","block_type":"box","text":"issue credit ratings are generally assigned to those obligations","page_number":574,"box":{"x":526,"y":221,"width":423,"height":13}},{"id":"776d0e1f-b99a-4816-ba65-2961df5121d7","block_type":"box","text":"considered short-term in the relevant market, typically with an original maturity of no more than 365 days. Short-term issue credit","page_number":574,"box":{"x":45,"y":236,"width":906,"height":13}},{"id":"c8861658-cb1d-4b80-b784-0140dc43a8d3","block_type":"box","text":"ratings are also used to indicate the creditworthiness of an obligor with respect to put features on long-term obligations. S&P","page_number":574,"box":{"x":45,"y":252,"width":869,"height":13}},{"id":"d3a1020e-7014-4810-a028-7be82378daaa","block_type":"box","text":"would typically assign a long-term issue credit rating to an ob","page_number":574,"box":{"x":45,"y":267,"width":427,"height":13}},{"id":"3475e948-0cf8-4cde-bad6-b93c83716bf7","block_type":"box","text":"ligation with an original maturity of greater than 365 days.","page_number":574,"box":{"x":473,"y":267,"width":410,"height":13}},{"id":"c90d464b-270c-49eb-9d7c-c07d5fc30d06","block_type":"box","text":"However, the ratings S&P assigns to certain instruments may div","page_number":574,"box":{"x":45,"y":283,"width":452,"height":13}},{"id":"3f52f5da-5119-4f58-940f-ff1efddc5b55","block_type":"box","text":"erge from these guidelines based on market practices. Medium","page_number":574,"box":{"x":497,"y":283,"width":438,"height":13}},{"id":"11a57f29-cc0e-4860-a645-c19866d0c498","block_type":"box","text":"term notes are assigned long-term ratings.","page_number":574,"box":{"x":45,"y":298,"width":289,"height":13}},{"id":"10e94bfb-b05c-4edc-a5ee-745e754138f9","block_type":"box","text":"Issue credit ratings are based, in varying degrees, on S&P’s analysis of the following considerations:","page_number":574,"box":{"x":45,"y":329,"width":689,"height":13}},{"id":"7fa81210-64d9-455a-95bb-2204011d4e07","block_type":"box","text":"• The likelihood of payment — the capacity and willingness of the obligor to meet its financial commitments on an","page_number":574,"box":{"x":80,"y":353,"width":849,"height":12}},{"id":"dea0350a-4d7f-41cd-bc0a-bcd39932e260","block_type":"box","text":"obligation in accordance with the terms of the obligation;","page_number":574,"box":{"x":106,"y":368,"width":417,"height":13}},{"id":"ff9aeaf8-4b82-46bb-9d6a-c4dd42438057","block_type":"box","text":"• The nature and provisions of the financial obligation, and the promise S&P imputes; and","page_number":574,"box":{"x":80,"y":391,"width":672,"height":13}},{"id":"ae0bfbde-23bd-4b94-82cf-724f1449e949","block_type":"box","text":"• The protection afforded by, and relative position of, the financial obligation in the event of a bankruptcy,","page_number":574,"box":{"x":80,"y":415,"width":792,"height":12}},{"id":"e85f697d-40f5-41cf-87aa-e9f3c6f178d0","block_type":"box","text":"reorganization, or other arrangement under the laws of bankruptcy and other laws affecting creditors’ rights.","page_number":574,"box":{"x":106,"y":430,"width":792,"height":13}},{"id":"94890584-a64c-40f2-bea1-9a2a67561b70","block_type":"box","text":"An issue rating is an assessment of default risk but may incorporat","page_number":574,"box":{"x":45,"y":453,"width":461,"height":13}},{"id":"c41b8604-bbe3-478f-a55a-d8741696b5e3","block_type":"box","text":"e an assessment of relative seniority or ultimate recovery in the","page_number":574,"box":{"x":506,"y":453,"width":434,"height":13}},{"id":"71485dae-500b-475d-9eae-fe5d2d9ba29d","block_type":"box","text":"event of default. Junior obligations are typically rated lower than senior obligations, to reflect lower priority in bankruptcy, as","page_number":574,"box":{"x":46,"y":469,"width":873,"height":13}},{"id":"3216071d-d9b5-457f-8850-8dafeb823361","block_type":"box","text":"noted above. (Such differentiation may apply when an entity has both senior and subordinated obligations, secured and unsecured","page_number":574,"box":{"x":45,"y":484,"width":904,"height":13}},{"id":"f84afb05-d70e-4a99-b2b1-aa81898ed7a8","block_type":"box","text":"obligations, or operating company and holding company obligations.)","page_number":574,"box":{"x":46,"y":500,"width":485,"height":13}},{"id":"f9660467-8140-4e05-8620-ab062cb223cb","block_type":"box","text":"Long-Term Issue Credit Ratings*","page_number":574,"box":{"x":45,"y":528,"width":232,"height":13}},{"id":"aec01ce7-702d-4478-9886-107c70b5f87a","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":574,"box":{"x":45,"y":553,"width":881,"height":13}},{"id":"caee5da9-211b-4337-bc10-742094194aa5","block_type":"box","text":"financial commitments on the obligation is extremely strong.","page_number":574,"box":{"x":197,"y":567,"width":440,"height":13}},{"id":"ce9cdede-0bc4-4244-83ae-d42403227b3d","block_type":"box","text":"AA An obligation rated ‘AA’ differs from the highest-rated obligations only to a small degree. The obligor’s","page_number":574,"box":{"x":45,"y":597,"width":904,"height":13}},{"id":"f3416a61-a732-49d8-b672-ffc0c7aaaec0","block_type":"box","text":"capacity to meet its financial commitments on the obligation is very strong.","page_number":574,"box":{"x":197,"y":611,"width":545,"height":13}},{"id":"fdb28317-519a-4bc3-b5e1-a9b449b7c20f","block_type":"box","text":"A An obligation rated ‘A’ is somewhat more susceptible to the adverse effects of changes in circumstances","page_number":574,"box":{"x":45,"y":630,"width":902,"height":13}},{"id":"f648dbd6-0a47-42ab-a8b6-246a4b3c7408","block_type":"box","text":"and economic conditions than obligations in higher-rated categories. However, the obligor’s capacity to","page_number":574,"box":{"x":197,"y":645,"width":753,"height":12}},{"id":"ce1d286f-1909-4c85-a563-9ae21deb634b","block_type":"box","text":"meet its financial commitments on the obligation is still strong.","page_number":574,"box":{"x":197,"y":659,"width":456,"height":13}},{"id":"0595748a-44ad-43b5-b35b-d81cff18b870","block_type":"box","text":"BBB An obligation rated ‘BBB’ exhibits adequate protection parameters. However, adverse economic","page_number":574,"box":{"x":46,"y":678,"width":848,"height":13}},{"id":"cbdaaec0-7a62-4926-8105-16a976381c46","block_type":"box","text":"conditions or changing circumstances are more likely to weaken the obligor’s capacity to meet its","page_number":574,"box":{"x":197,"y":692,"width":705,"height":13}},{"id":"459d33da-62f2-43e5-b615-e1a4d0f0fccc","block_type":"box","text":"financial commitments on the obligation.","page_number":574,"box":{"x":197,"y":707,"width":298,"height":12}},{"id":"c3ce4823-0ae5-4333-8f04-4f5b1c83133c","block_type":"box","text":"BB, B, CCC, CC,","page_number":574,"box":{"x":46,"y":727,"width":123,"height":11}},{"id":"979ae33a-a665-4959-9ee0-95cf2031caf0","block_type":"box","text":"and C Obligations rated ‘BB’, ‘B’, ‘CCC’, ‘CC’, and ‘C’ are regarded as having significant speculative","page_number":574,"box":{"x":46,"y":740,"width":835,"height":13}},{"id":"f2f9d413-7818-4693-b6f7-9051087a66bf","block_type":"box","text":"characteristics. ‘BB’ indicates the least degree of speculation and ‘C’ the highest. While such obligations","page_number":574,"box":{"x":197,"y":754,"width":749,"height":13}},{"id":"ffed99dd-6410-4269-92e2-37482bd8f65d","block_type":"box","text":"will likely have some quality and protective characteristics, these may be outweighed by large","page_number":574,"box":{"x":197,"y":769,"width":677,"height":13}},{"id":"11abbd14-bd9d-4747-bd7c-b43c9a769f42","block_type":"box","text":"uncertainties or major exposure to adverse conditions.","page_number":574,"box":{"x":197,"y":783,"width":393,"height":13}},{"id":"6d07f70e-1222-4d47-b813-522c32033e82","block_type":"box","text":"BB An obligation rated ‘BB’ is less vulnerable to nonpayment than other speculative issues. However, it","page_number":574,"box":{"x":46,"y":802,"width":875,"height":13}},{"id":"3493dcb5-f0ad-4ccf-bea2-65085944ecbf","block_type":"box","text":"faces major ongoing uncertainties or exposure to adverse business, financial, or economic conditions","page_number":574,"box":{"x":197,"y":817,"width":729,"height":12}},{"id":"18a147b8-74f4-4d79-ae28-c5055169b802","block_type":"box","text":"that could lead to the obligor’s inadequate capacity to meet its financial commitments on the","page_number":574,"box":{"x":197,"y":831,"width":673,"height":13}},{"id":"525f9cca-8269-4646-82cf-7a24436419ac","block_type":"box","text":"obligation.","page_number":574,"box":{"x":197,"y":845,"width":77,"height":13}},{"id":"6a8bb8ea-5ccd-49da-a0f2-ff390581a996","block_type":"box","text":"A-4","page_number":574,"box":{"x":486,"y":916,"width":26,"height":10}},{"id":"27fec13d-82b5-4652-9e5f-bf68b75adfc6","block_type":"box","text":"NM1026U-6004382-574/605","page_number":574,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a15f57ad-e08c-4ced-8ab0-81dc02eba04c","block_type":"box","text":"B An obligation rated ‘B’ is more vulnerable to nonpayment than obligations rated ‘BB’, but the obligor","page_number":575,"box":{"x":46,"y":83,"width":888,"height":12}},{"id":"f6dbb46a-f1d3-4012-ac64-20dbe0098d4b","block_type":"box","text":"currently has the capacity to meet its financial commitments on the obligation. Adverse business,","page_number":575,"box":{"x":197,"y":97,"width":702,"height":13}},{"id":"71d7a73d-9f5f-4a4a-af03-8a379d2e5614","block_type":"box","text":"financial, or economic conditions will likely impair the obligor’s capacity or willingness to meet its","page_number":575,"box":{"x":197,"y":111,"width":716,"height":13}},{"id":"cab2419a-c3ac-46ed-a2a2-77522d04f186","block_type":"box","text":"financial commitments on the obligation.","page_number":575,"box":{"x":197,"y":125,"width":298,"height":13}},{"id":"abd501f3-18d8-415f-a983-6743de0c0fdd","block_type":"box","text":"CCC An obligation rated ‘CCC’ is currently vulnerable to nonpayment and is dependent upon favorable","page_number":575,"box":{"x":46,"y":145,"width":867,"height":12}},{"id":"63ed7909-291f-4824-b32e-a8d23c995b8e","block_type":"box","text":"business, financial, and economic conditions for the obligor to meet its financial commitments on the","page_number":575,"box":{"x":197,"y":159,"width":734,"height":13}},{"id":"809164f6-45f2-4a8f-af25-75bde70d704c","block_type":"box","text":"obligation. In the event of adverse business, financial, or economic conditions, the obligor is not likely","page_number":575,"box":{"x":197,"y":173,"width":741,"height":13}},{"id":"8f466f67-0201-4137-a245-404cfbcbe1a4","block_type":"box","text":"to have the capacity to meet its financial commitments on the obligation.","page_number":575,"box":{"x":197,"y":187,"width":528,"height":13}},{"id":"f2caa438-1e29-4983-ad88-1127b3fcf54c","block_type":"box","text":"CC An obligation rated ‘CC’ is currently highly vulnerable to nonpayment. The ‘CC’ rating is used when a","page_number":575,"box":{"x":46,"y":207,"width":896,"height":12}},{"id":"c800d7f3-21d8-4125-9f63-b48ca04f37bd","block_type":"box","text":"default has not yet occurred but S&P expects default to be a virtual certainty, regardless of the","page_number":575,"box":{"x":197,"y":221,"width":687,"height":13}},{"id":"bce02b58-0669-47da-b509-e23bbe43eb50","block_type":"box","text":"anticipated time to default.","page_number":575,"box":{"x":197,"y":235,"width":195,"height":13}},{"id":"5cdbc110-381b-41ba-863e-8d5f1cfe2606","block_type":"box","text":"C An obligation rated ‘C’ is currently highly vulnerable to nonpayment, and the obligation is expected to","page_number":575,"box":{"x":46,"y":254,"width":896,"height":13}},{"id":"a98a2da1-84ca-4c56-91ee-833ee46aacf3","block_type":"box","text":"have lower relative seniority or lower ultimate recovery compared with obligations that are rated","page_number":575,"box":{"x":197,"y":269,"width":705,"height":13}},{"id":"9352cfc2-de02-48a7-bac2-d2684a35d60f","block_type":"box","text":"higher.","page_number":575,"box":{"x":197,"y":283,"width":49,"height":13}},{"id":"d5d5fc7e-edff-477b-be45-638e3625210f","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":575,"box":{"x":45,"y":302,"width":847,"height":13}},{"id":"6aa5682b-927c-47a9-a362-de2d315884b6","block_type":"box","text":"instruments, the ‘D’ rating category is used when payments on an obligation are not made on the date","page_number":575,"box":{"x":197,"y":317,"width":740,"height":12}},{"id":"e3dff700-a923-44f6-8766-e4c4c91bdd1e","block_type":"box","text":"due, unless S&P believes that such payments will be made within five business days in the absence of a","page_number":575,"box":{"x":197,"y":331,"width":745,"height":13}},{"id":"99e5afcb-2a8c-45f3-827c-c2c656e031f3","block_type":"box","text":"stated grace period or within the earlier of the stated grace period or 30 calendar days. The ‘D’ rating","page_number":575,"box":{"x":197,"y":345,"width":737,"height":13}},{"id":"9cf49e6c-0b0f-4b77-820b-501344849bda","block_type":"box","text":"also will be used upon the filing of a bankruptcy petition or the taking of similar action and where","page_number":575,"box":{"x":197,"y":359,"width":715,"height":13}},{"id":"68ac14e2-f4e4-44f5-8da5-1f4a08c700cc","block_type":"box","text":"default on an obligation is a virtual certainty, for example due to automatic stay provisions. A rating on","page_number":575,"box":{"x":197,"y":373,"width":755,"height":13}},{"id":"589be0d6-df57-4544-b571-989732bef81a","block_type":"box","text":"an obligation is lowered to ‘D’ if it is subject to a distressed debt restructuring.","page_number":575,"box":{"x":197,"y":388,"width":569,"height":12}},{"id":"f737df61-9424-4b12-a0ef-3a2f36179a17","block_type":"box","text":"* Ratings from ‘AA’ to ‘CCC’ may be modified by the addition of a plus (+) or minus (-) sign to show relative standing within the","page_number":575,"box":{"x":47,"y":411,"width":898,"height":13}},{"id":"08ab9b7d-4243-4ea0-8a27-ca58c2ae12cd","block_type":"box","text":"rating categories.","page_number":575,"box":{"x":45,"y":427,"width":118,"height":12}},{"id":"053b0a5e-1abd-4e93-90a1-ae313b07bd5e","block_type":"box","text":"Short-Term Issue Credit Ratings","page_number":575,"box":{"x":46,"y":455,"width":234,"height":13}},{"id":"875c3aea-c468-4efb-b3cd-197bd67b6ca9","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":575,"box":{"x":45,"y":479,"width":884,"height":13}},{"id":"6ef86ba8-d408-4e20-a918-f11b040f311c","block_type":"box","text":"meet its financial commitments on the obligation is strong. Within this category, certain obligations are","page_number":575,"box":{"x":197,"y":494,"width":750,"height":12}},{"id":"b7327bdb-88a2-4283-9a2a-2831e9772cc3","block_type":"box","text":"designated with a plus sign (+). This indicates that the obligor’s capacity to meet its financial","page_number":575,"box":{"x":197,"y":508,"width":672,"height":13}},{"id":"0e838b47-e2bc-4cfc-8d7b-6e827796229c","block_type":"box","text":"commitments on these obligations is extremely strong.","page_number":575,"box":{"x":197,"y":522,"width":393,"height":13}},{"id":"98c02dc5-15ae-47f2-b8d4-e8aed0548bfb","block_type":"box","text":"A-2 A short-term obligation rated ‘A-2’ is somewhat more susceptible to the adverse effects of changes in","page_number":575,"box":{"x":45,"y":536,"width":884,"height":13}},{"id":"cc03b2a2-2666-446d-866d-4181b758e5b5","block_type":"box","text":"circumstances and economic conditions than obligations in higher rating categories. However, the","page_number":575,"box":{"x":197,"y":550,"width":711,"height":13}},{"id":"70e248a2-ea39-4c58-8e19-4442c2e03f51","block_type":"box","text":"obligor’s capacity to meet its financial commitments on the obligation is satisfactory.","page_number":575,"box":{"x":197,"y":565,"width":616,"height":12}},{"id":"4bf5da1c-44e1-4865-ae6a-b2c469c1c9ed","block_type":"box","text":"A-3 A short-term obligation rated ‘A-3’ exhibits adequate protection parameters. However, adverse","page_number":575,"box":{"x":45,"y":584,"width":843,"height":13}},{"id":"9f139739-9977-4ae1-8869-b86d8b7e09ea","block_type":"box","text":"economic conditions or changing circumstances are more likely to weaken an obligor’s capacity to meet","page_number":575,"box":{"x":197,"y":598,"width":753,"height":13}},{"id":"44e51c47-a0e2-4e90-ac4c-3a440e3840a9","block_type":"box","text":"its financial commitments on the obligation.","page_number":575,"box":{"x":197,"y":612,"width":319,"height":13}},{"id":"c3e974f9-9885-46d3-bdc6-4725d3012084","block_type":"box","text":"B A short-term obligation rated ‘B’ is regarded as vulnerable and has significant speculative","page_number":575,"box":{"x":46,"y":632,"width":798,"height":13}},{"id":"9a185152-f509-432a-94c4-590362e9e88d","block_type":"box","text":"characteristics. The obligor currently has the capacity to meet its financial commitments; however, it","page_number":575,"box":{"x":197,"y":646,"width":730,"height":13}},{"id":"13b15155-4e6d-4093-bba8-5cf39b0dc2d3","block_type":"box","text":"faces major ongoing uncertainties that could lead to the obligor’s inadequate capacity to meet its","page_number":575,"box":{"x":197,"y":660,"width":701,"height":13}},{"id":"84feafd9-db81-4c6b-89ec-d2d72b3b4eaf","block_type":"box","text":"financial commitments.","page_number":575,"box":{"x":197,"y":674,"width":169,"height":10}},{"id":"bf877ba7-e03a-488d-a202-5f47f2abcd83","block_type":"box","text":"C A short-term obligation rated ‘C’ is currently vulnerable to nonpayment and is dependent upon","page_number":575,"box":{"x":46,"y":694,"width":842,"height":13}},{"id":"5095efeb-80e7-4d39-935c-7f8e06e123d4","block_type":"box","text":"favorable business, financial, and economic conditions for the obligor to meet its financial","page_number":575,"box":{"x":197,"y":708,"width":654,"height":13}},{"id":"20eb647f-40e5-4722-93f3-c6722e3db980","block_type":"box","text":"commitments on the obligation.","page_number":575,"box":{"x":197,"y":722,"width":230,"height":13}},{"id":"6a43e7b1-5848-49d7-a7de-c11d4b970c51","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":575,"box":{"x":45,"y":742,"width":866,"height":12}},{"id":"4b3b5883-3e0f-4578-a5b0-8fdad2f3fdce","block_type":"box","text":"capital instruments, the ‘D’ rating category is used when payments on an obligation are not made on","page_number":575,"box":{"x":197,"y":756,"width":731,"height":13}},{"id":"98cee806-bf90-442d-a3d7-cbcb649817c9","block_type":"box","text":"the date due, unless S&P believes that such payments will be made within any stated grace period.","page_number":575,"box":{"x":197,"y":770,"width":712,"height":13}},{"id":"0c016cf1-8057-4f41-ab3e-28f75abf748e","block_type":"box","text":"However, any stated grace period longer than five business days will be treated as five business days.","page_number":575,"box":{"x":197,"y":784,"width":730,"height":13}},{"id":"8b03e911-809f-4956-87cc-7504bab39ffa","block_type":"box","text":"The ‘D’ rating also will be used upon the filing of a bankruptcy petition or the taking of a similar action","page_number":575,"box":{"x":197,"y":798,"width":755,"height":13}},{"id":"c5af7445-6caf-4174-a7e0-91ba56258fef","block_type":"box","text":"and where default on an obligation is a virtual certainty, for example due to automatic stay provisions.","page_number":575,"box":{"x":197,"y":813,"width":747,"height":12}},{"id":"061a7401-0cb7-4724-869c-6073d1bd9566","block_type":"box","text":"A rating on an obligation is lowered to ‘D’ if it is subject to a distressed debt restructuring.","page_number":575,"box":{"x":197,"y":827,"width":657,"height":13}},{"id":"551c3e68-c1ca-4c8b-901c-c82596beb0c9","block_type":"box","text":"A-5","page_number":575,"box":{"x":486,"y":916,"width":26,"height":10}},{"id":"f7c755f8-8df3-49af-bff8-5443f2bf003d","block_type":"box","text":"NM1026U-6004382-575/605","page_number":575,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f0e912b0-373c-4d7d-9316-cdf2da1897fd","block_type":"box","text":"Description of S&P’s Municipal Short-Term Note Ratings","page_number":576,"box":{"x":45,"y":79,"width":424,"height":13}},{"id":"c7aec228-76f6-44bf-83ad-391d925da7af","block_type":"box","text":"An S&P U.S. municipal note rating reflects S&P’s opinion about th","page_number":576,"box":{"x":45,"y":105,"width":467,"height":12}},{"id":"d485a0ad-4d2e-4225-9c59-85d08f476099","block_type":"box","text":"e liquidity factors and market access risks unique to the notes.","page_number":576,"box":{"x":513,"y":105,"width":428,"height":12}},{"id":"c5f69431-cddd-4091-b505-6993f210bdb5","block_type":"box","text":"Notes due in three years or less will likely receive a note rating. No","page_number":576,"box":{"x":45,"y":120,"width":464,"height":13}},{"id":"2762bce5-359a-44e8-853c-849c99a29f9b","block_type":"box","text":"tes with an original maturity of more than three years will most","page_number":576,"box":{"x":509,"y":120,"width":441,"height":13}},{"id":"4b85b5f6-5de4-4702-9fef-d448a076a345","block_type":"box","text":"likely receive a long-term debt rating. In determining which ty","page_number":576,"box":{"x":45,"y":136,"width":429,"height":12}},{"id":"3abfff97-c2c7-451d-8846-1e0cba408b0a","block_type":"box","text":"pe of rating, if any, to assign, S&P’s analysis will review the","page_number":576,"box":{"x":475,"y":136,"width":414,"height":12}},{"id":"a2334338-cfdf-4964-b4d6-396b852ee324","block_type":"box","text":"following considerations:","page_number":576,"box":{"x":45,"y":151,"width":174,"height":13}},{"id":"ff5cf54c-5895-4e18-818a-f6573a37777b","block_type":"box","text":"• Amortization schedule — the larger the final maturity relative to other maturities, the more likely it will be treated","page_number":576,"box":{"x":80,"y":174,"width":857,"height":13}},{"id":"b27f5649-1fb5-442a-9e92-481f789e3dbf","block_type":"box","text":"as a note; and","page_number":576,"box":{"x":106,"y":190,"width":100,"height":12}},{"id":"2ff9185a-11d5-4821-92da-238df053d1b6","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":576,"box":{"x":80,"y":213,"width":841,"height":13}},{"id":"980f9114-0a96-4171-a545-ce94d4452d9e","block_type":"box","text":"treated as a note.","page_number":576,"box":{"x":106,"y":229,"width":123,"height":10}},{"id":"3e4ecf80-2157-4683-9a37-cdc3cbba404e","block_type":"box","text":"S&P’s municipal short-term note rating symbols are as follows:","page_number":576,"box":{"x":46,"y":252,"width":438,"height":13}},{"id":"bda5ad2b-d812-4175-82c3-44288c0262c3","block_type":"box","text":"SP-1 Strong capacity to pay principal and interest. An issue determined to possess a very strong capacity to","page_number":576,"box":{"x":46,"y":276,"width":889,"height":13}},{"id":"f9d9034d-4e95-4391-81d8-b72cfaf8e964","block_type":"box","text":"pay debt service is given a plus (+) designation.","page_number":576,"box":{"x":197,"y":291,"width":339,"height":12}},{"id":"bbab46f2-878c-4576-8132-f8e5d2abd936","block_type":"box","text":"SP-2 Satisfactory capacity to pay principal and interest, with some vulnerability to adverse financial and","page_number":576,"box":{"x":46,"y":310,"width":869,"height":13}},{"id":"d5bc68d9-2cc1-4da4-ab93-6c0978384640","block_type":"box","text":"economic changes over the term of the notes.","page_number":576,"box":{"x":197,"y":324,"width":326,"height":13}},{"id":"c05e3382-12a7-4ba4-8159-f322c6b89721","block_type":"box","text":"SP-3 Speculative capacity to pay principal and interest.","page_number":576,"box":{"x":46,"y":344,"width":510,"height":12}},{"id":"9ea20989-09d4-4ef0-a907-c78fbaa11a8f","block_type":"box","text":"D ‘D’ is assigned upon failure to pay the note when due, completion of a distressed debt restructuring, or","page_number":576,"box":{"x":45,"y":363,"width":897,"height":13}},{"id":"c99ad8a0-8447-4afb-8283-9b2d6d263188","block_type":"box","text":"the filing of a bankruptcy petition or the taking of similar action and where default on an obligation is","page_number":576,"box":{"x":197,"y":377,"width":744,"height":13}},{"id":"33782dcb-dee5-43f0-a54a-47f39c30ba7c","block_type":"box","text":"a virtual certainty, for example due to automatic stay provisions.","page_number":576,"box":{"x":197,"y":391,"width":470,"height":13}},{"id":"1d1a9705-410c-4d23-a1e8-7ca6bd5c6d32","block_type":"box","text":"Description of Fitch Ratings’ (“Fitch’s”) Credit Ratings Scales","page_number":576,"box":{"x":45,"y":420,"width":450,"height":13}},{"id":"be536439-bcf7-4092-80db-b0295e131265","block_type":"box","text":"Fitch Ratings publishes opinions on a variety of scales. The most common of these are credit ratings, but the agency also publishes","page_number":576,"box":{"x":45,"y":446,"width":904,"height":13}},{"id":"f8e37276-edd8-4490-b0de-612dd523711b","block_type":"box","text":"ratings, scores and other relative opinions relating to financial or op","page_number":576,"box":{"x":45,"y":461,"width":471,"height":13}},{"id":"be58cfa0-9a7e-4f99-aa0d-1a3eced65b56","block_type":"box","text":"erational strength. For example, Fitch also provides specialized","page_number":576,"box":{"x":516,"y":461,"width":435,"height":13}},{"id":"8239c4b4-20ca-402e-a2d0-c47b90fb307e","block_type":"box","text":"ratings of servicers of residential and commercial mortgages, asset managers and funds. In each case, users should refer to the","page_number":576,"box":{"x":45,"y":477,"width":869,"height":13}},{"id":"95eaf4af-09c0-4bfe-913e-b29646f12d2d","block_type":"box","text":"definitions of each individual scale for guidance on the dimensions of risk covered in each assessment.","page_number":576,"box":{"x":46,"y":492,"width":704,"height":13}},{"id":"da04aa3c-c7d8-4069-8285-00be0b6aec43","block_type":"box","text":"Fitch’s credit ratings relating to issuers are an opinion on the rel","page_number":576,"box":{"x":45,"y":515,"width":442,"height":13}},{"id":"c25c4b12-0e1a-4ba4-9560-e49ab2b7806f","block_type":"box","text":"ative ability of an entity to meet financial commitments, such as","page_number":576,"box":{"x":488,"y":515,"width":441,"height":13}},{"id":"35febf3e-c472-48ec-a16f-c76887b32f88","block_type":"box","text":"interest, preferred dividends, repayment of principal, insurance","page_number":576,"box":{"x":45,"y":531,"width":435,"height":13}},{"id":"e323d771-3ef1-4dd5-9054-3e1cb84bfe44","block_type":"box","text":"claims or counterparty obligations. Credit ratings relating to","page_number":576,"box":{"x":485,"y":531,"width":418,"height":13}},{"id":"31c61fe6-50a2-4fea-b3e9-9651e4b976a9","block_type":"box","text":"securities and obligations of an issuer can include a recovery expectation. Credit ratings are used by investors as indications of the","page_number":576,"box":{"x":46,"y":546,"width":898,"height":13}},{"id":"4b59c724-097b-4388-8987-177287baf89f","block_type":"box","text":"likelihood of receiving the money owed to them in accordance with the terms on which they invested. The agency’s credit ratings","page_number":576,"box":{"x":45,"y":562,"width":894,"height":13}},{"id":"625a0779-3c3f-4aef-a6ba-715905a6148c","block_type":"box","text":"cover the global spectrum of corporate, sovereign financial, bank,","page_number":576,"box":{"x":45,"y":577,"width":455,"height":13}},{"id":"0d474899-7a8f-4188-99e9-c70fb88d923f","block_type":"box","text":"insurance, and public finance entities (including supranational","page_number":576,"box":{"x":505,"y":577,"width":430,"height":13}},{"id":"1d7302ea-b6f7-4afc-8f4a-b11ccaf72629","block_type":"box","text":"and sub-national entities) and the securities or other obligations","page_number":576,"box":{"x":46,"y":593,"width":440,"height":13}},{"id":"5e2e9bac-8071-4080-9c30-bff58faa20ff","block_type":"box","text":"they issue, as well as structured finance securities backed by","page_number":576,"box":{"x":491,"y":593,"width":414,"height":13}},{"id":"6ed321d0-472f-4daf-8fd5-b573a084ae07","block_type":"box","text":"receivables or other financial assets.","page_number":576,"box":{"x":45,"y":608,"width":247,"height":11}},{"id":"67ac6ca7-a419-4200-b3ad-b5ac944a1ff3","block_type":"box","text":"The terms “investment grade” and “speculative grade” have established themselves over time as shorthand to describe the","page_number":576,"box":{"x":45,"y":632,"width":846,"height":13}},{"id":"8bc2c1c3-cbc5-4b56-98db-6c7e1b6ff720","block_type":"box","text":"categories ‘AAA’ to ‘BBB’ (investment grade) and ‘BB’ to ‘D’ (speculative grade). The terms investment grade and speculative","page_number":576,"box":{"x":45,"y":647,"width":866,"height":13}},{"id":"7b0bc9f1-a16a-41a4-a5c4-5fe681c9d897","block_type":"box","text":"grade are market conventions and do not imply any recommendation or endorsement of a specific security for investment","page_number":576,"box":{"x":45,"y":663,"width":844,"height":13}},{"id":"6bde0b00-e859-4270-8ddb-11c28f514eed","block_type":"box","text":"purposes. Investment grade categories indicate relatively low to m","page_number":576,"box":{"x":45,"y":678,"width":456,"height":13}},{"id":"20ced56a-a201-4c43-a93b-03fca5d6d936","block_type":"box","text":"oderate credit risk, while ratings in the speculative categories","page_number":576,"box":{"x":502,"y":678,"width":420,"height":13}},{"id":"0e17501c-a7a5-4b2f-85e6-19c201f70736","block_type":"box","text":"either signal a higher level of credit risk or that a default has already occurred.","page_number":576,"box":{"x":46,"y":694,"width":540,"height":13}},{"id":"bd9b9bf1-74a2-4e63-9061-173b07f90117","block_type":"box","text":"For the convenience of investors, Fitch may also include issues relating to a rated issuer that are not and have not been rated on its","page_number":576,"box":{"x":45,"y":717,"width":903,"height":13}},{"id":"a159e921-518b-4809-b2b6-0fff8e3a6294","block_type":"box","text":"web page. Such issues are also denoted as ‘NR’.","page_number":576,"box":{"x":45,"y":733,"width":330,"height":12}},{"id":"70b071be-2f58-4116-a4cf-590dde5d7a71","block_type":"box","text":"Credit ratings express risk in relative rank order, which is to say","page_number":576,"box":{"x":46,"y":756,"width":443,"height":13}},{"id":"3fc7732f-afde-424d-bb7c-03095430845c","block_type":"box","text":"they are ordinal measures of credit risk and are not predictive of a","page_number":576,"box":{"x":494,"y":756,"width":457,"height":13}},{"id":"989f0f50-da88-4727-be31-9ee2880aefa0","block_type":"box","text":"specific frequency of default or loss. For information about the historical performance of ratings please refer to Fitch’s Ratings","page_number":576,"box":{"x":46,"y":771,"width":874,"height":13}},{"id":"abf5dba8-8b79-475f-b81d-b5b7ac823ced","block_type":"box","text":"Transition and Default studies which detail the historical de","page_number":576,"box":{"x":45,"y":787,"width":415,"height":10}},{"id":"39be8ffb-a62f-4fc9-bae9-4b185fa32a7f","block_type":"box","text":"fault rates and their meaning. The European Securities and Markets","page_number":576,"box":{"x":461,"y":787,"width":469,"height":13}},{"id":"f31ca1fc-eb6e-49f6-b743-0ca0b88b1bd0","block_type":"box","text":"Authority also maintains a central repository of historical default rates.","page_number":576,"box":{"x":45,"y":802,"width":492,"height":13}},{"id":"59819b9f-4462-4e30-8ce9-bd257d5f2865","block_type":"box","text":"Fitch’s credit ratings do not directly address any risk other than","page_number":576,"box":{"x":45,"y":826,"width":440,"height":12}},{"id":"a17c1fc9-cab9-4b39-a262-82f8ceb4c16f","block_type":"box","text":"credit risk. In particular, ratings do not deal with the risk of a","page_number":576,"box":{"x":490,"y":826,"width":426,"height":12}},{"id":"31f48f1d-9876-450b-9e5a-f94346c8afbc","block_type":"box","text":"market value loss on a rated security due to changes in interest rates, liquidity and other market considerations. However, in terms","page_number":576,"box":{"x":45,"y":841,"width":905,"height":13}},{"id":"5e06ec8e-278f-43b1-9245-8bae79ad88c6","block_type":"box","text":"of payment obligation on the rated liability, market risk may be c","page_number":576,"box":{"x":46,"y":857,"width":453,"height":12}},{"id":"1bb83e24-be5c-4d0a-bdf3-77a183311369","block_type":"box","text":"onsidered to the extent that it influences the ability of an issuer to","page_number":576,"box":{"x":499,"y":857,"width":454,"height":12}},{"id":"1d8e47e4-1128-4f97-be82-5f6efb0852ab","block_type":"box","text":"pay upon a commitment.","page_number":576,"box":{"x":45,"y":873,"width":174,"height":12}},{"id":"551a5a69-6921-4541-b375-2431ab16c621","block_type":"box","text":"A-6","page_number":576,"box":{"x":486,"y":916,"width":26,"height":10}},{"id":"68658441-e010-4c37-b066-859221d1bd9f","block_type":"box","text":"NM1026U-6004382-576/605","page_number":576,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"74aad5e4-aecd-4920-8c6b-d63636979d3c","block_type":"box","text":"Ratings nonetheless do not reflect market risk to the extent that the","page_number":577,"box":{"x":46,"y":79,"width":466,"height":13}},{"id":"edd2e792-15b3-4bdc-9e4a-1b0d8f4f5beb","block_type":"box","text":"y influence the size or other conditionality of the obligation to","page_number":577,"box":{"x":513,"y":79,"width":429,"height":13}},{"id":"c9b6e029-b662-4e4f-b54b-34f8d7436161","block_type":"box","text":"pay upon a commitment (for example, in the case of index-linked bonds).","page_number":577,"box":{"x":45,"y":94,"width":510,"height":13}},{"id":"a41fe9b5-fbb8-431a-9f41-05a63861f912","block_type":"box","text":"In the default components of ratings assigned to individual obliga","page_number":577,"box":{"x":45,"y":118,"width":454,"height":12}},{"id":"c4548374-84e4-4523-8af7-c9b36c3fc835","block_type":"box","text":"tions or instruments, the agency typically rates to the likelihood","page_number":577,"box":{"x":500,"y":118,"width":440,"height":12}},{"id":"09c0fc1a-3d1e-41f7-9d20-297b4c434b09","block_type":"box","text":"of non-payment or default in accordance with the terms of that i","page_number":577,"box":{"x":46,"y":133,"width":447,"height":13}},{"id":"b949c27e-522f-4d6e-9df0-8eebd3fb4e90","block_type":"box","text":"nstrument’s documentation. In limited cases, Fitch may include","page_number":577,"box":{"x":493,"y":133,"width":437,"height":13}},{"id":"50ecf649-fd60-48ee-b95e-a51630405675","block_type":"box","text":"additional considerations (i.e. rate to a higher or lower standa","page_number":577,"box":{"x":46,"y":149,"width":428,"height":12}},{"id":"42cf85c2-e849-49ee-902c-95c34721ad77","block_type":"box","text":"rd than that implied in the obligation’s documentation).","page_number":577,"box":{"x":475,"y":149,"width":386,"height":12}},{"id":"f2e43ab7-1551-4689-afe2-ef696da58e38","block_type":"box","text":"The primary credit rating scales can be used to provide a rating of privately issued obligations or certain note issuance programs or","page_number":577,"box":{"x":45,"y":172,"width":908,"height":13}},{"id":"2b12a354-d4e9-4d2b-85f1-d1d433780934","block_type":"box","text":"for private ratings. In this case the rating is not published, but only provided to the issuer or its agents in the form of a rating letter.","page_number":577,"box":{"x":45,"y":187,"width":907,"height":13}},{"id":"92b06cb7-972d-4f16-91c9-31198a6cc19b","block_type":"box","text":"The primary credit rating scales may also be used to provide ratings for a more narrow scope, including interest strips and return","page_number":577,"box":{"x":45,"y":211,"width":894,"height":12}},{"id":"d23acc60-c5e8-4801-8ea8-c785276cc4d3","block_type":"box","text":"of principal or in other forms of opinions such as credit opinions","page_number":577,"box":{"x":46,"y":226,"width":448,"height":13}},{"id":"89248b84-7b91-43d0-a12a-dfb3b2532542","block_type":"box","text":"or rating assessment services. Credit opinions are either a notch","page_number":577,"box":{"x":499,"y":226,"width":444,"height":13}},{"id":"2bdf58c2-3113-46ab-8ae9-a9d891ec33eb","block_type":"box","text":"or category-specific view using the primary rating scale and o","page_number":577,"box":{"x":46,"y":242,"width":424,"height":12}},{"id":"0911a21f-62ce-4abf-b0e9-032ff5035cd0","block_type":"box","text":"mit one or more characteristics of a full rating or meet them to a","page_number":577,"box":{"x":471,"y":242,"width":446,"height":12}},{"id":"ac408e5b-129f-4272-b059-80feafa3a624","block_type":"box","text":"different standard. Credit opinions will be indicated using a lower case letter symbol combined with either an ‘*’ (e.g. ‘bbb+*’) or","page_number":577,"box":{"x":46,"y":257,"width":897,"height":13}},{"id":"b82fa40b-3d12-45c5-9fef-28290516141d","block_type":"box","text":"(cat) suffix to denote the opinion status. Credit opinions will be point-in-time typically but may be monitored if the analytical","page_number":577,"box":{"x":46,"y":273,"width":869,"height":12}},{"id":"3ceabdcc-e67d-4a65-aacd-d76c0be8de79","block_type":"box","text":"group believes information will be sufficiently available. Rating a","page_number":577,"box":{"x":45,"y":288,"width":451,"height":13}},{"id":"3c99269e-84af-4524-80bc-52aa2dd52e57","block_type":"box","text":"ssessment services are a notch-specific view using the primary","page_number":577,"box":{"x":497,"y":288,"width":426,"height":13}},{"id":"37c18f49-c420-4703-9493-1e85390e367e","block_type":"box","text":"rating scale of how an existing or potential rating may be changed by a given set of hypothetical circumstances. While credit","page_number":577,"box":{"x":45,"y":304,"width":861,"height":12}},{"id":"a164f3d3-b704-419e-9058-a1fe0921bdd3","block_type":"box","text":"opinions and rating assessment services are point-in-time and are","page_number":577,"box":{"x":46,"y":319,"width":449,"height":13}},{"id":"9b4cbb60-ff9e-4ff0-9320-67eed792577a","block_type":"box","text":"not monitored, they may have a directional watch or outlook","page_number":577,"box":{"x":500,"y":319,"width":425,"height":13}},{"id":"268ed5c4-b3db-4131-bce0-be4f4c998013","block_type":"box","text":"assigned, which can signify the trajectory of the credit profile.","page_number":577,"box":{"x":46,"y":335,"width":425,"height":12}},{"id":"d74d5731-ed81-4372-9778-c3bd14d74edd","block_type":"box","text":"Description of Fitch’s Long-Term Corporate Finance Obligations Rating Scales","page_number":577,"box":{"x":45,"y":363,"width":575,"height":13}},{"id":"36f7d15b-e5d3-43a3-a095-4227f7373e67","block_type":"box","text":"Ratings of individual securities or financial obligations of a corpor","page_number":577,"box":{"x":46,"y":389,"width":459,"height":13}},{"id":"83a4d90c-de31-4d5f-b2fc-67f1f53661a0","block_type":"box","text":"ate issuer address relative vulnerability to default on an ordinal","page_number":577,"box":{"x":506,"y":389,"width":436,"height":13}},{"id":"9e19ada3-8437-4b62-9717-da92eb2a98d7","block_type":"box","text":"scale. In addition, for financial obligations in corporate fin","page_number":577,"box":{"x":46,"y":404,"width":405,"height":13}},{"id":"93414eac-aac0-4f26-90fb-98496e667a88","block_type":"box","text":"ance, a measure of recovery given default on that liability is also","page_number":577,"box":{"x":451,"y":404,"width":443,"height":13}},{"id":"cfa92172-1d45-49e8-ba4b-bbadf21b0e6f","block_type":"box","text":"included in the rating assessment. This notably applies to covered bonds ratings, which incorporate both an indication of the","page_number":577,"box":{"x":45,"y":420,"width":864,"height":13}},{"id":"e569bd4e-6684-4e0c-878c-d85982b45727","block_type":"box","text":"probability of default and of the recovery given a default of this debt instrument. On the contrary, Ratings of debtor-in-possession","page_number":577,"box":{"x":45,"y":435,"width":903,"height":13}},{"id":"d827f1ef-d323-4126-be48-afaf2afc61fc","block_type":"box","text":"(“DIP”) obligations incorporate the expectation of full repayment.","page_number":577,"box":{"x":46,"y":451,"width":459,"height":13}},{"id":"c4fb67f9-8941-4e07-840b-49607e13575b","block_type":"box","text":"The relationship between the issuer scale and obligation scale assu","page_number":577,"box":{"x":45,"y":474,"width":459,"height":13}},{"id":"a8b31ec6-e566-4258-a736-7f51e07fff7d","block_type":"box","text":"mes a generic historical average recovery. Individual obligations","page_number":577,"box":{"x":504,"y":474,"width":442,"height":13}},{"id":"6606086e-307d-437a-a91a-17668dfa0067","block_type":"box","text":"can be assigned ratings higher, lower, or the same as that entity’s","page_number":577,"box":{"x":45,"y":490,"width":449,"height":12}},{"id":"722af47d-083f-40f8-93f3-e391c78ae427","block_type":"box","text":"issuer rating or issuer default rating (“IDR”), based on their","page_number":577,"box":{"x":500,"y":490,"width":415,"height":12}},{"id":"0dd4db2d-eefe-4ff3-8cf6-09b09152fef2","block_type":"box","text":"relative ranking, relative vulnerability to default or based on explicit Recovery Ratings.","page_number":577,"box":{"x":45,"y":505,"width":602,"height":13}},{"id":"a7f6c6de-bf22-4c55-aa18-415dfd1b3395","block_type":"box","text":"As a result, individual obligations of entities, such as corporations","page_number":577,"box":{"x":45,"y":528,"width":456,"height":13}},{"id":"308dc9b8-6666-43a3-98d4-86ebabdf6822","block_type":"box","text":", are assigned ratings higher, lower, or the same as that entity’s","page_number":577,"box":{"x":502,"y":528,"width":435,"height":13}},{"id":"8cd411c0-4900-4fc9-9e3f-378df6b9fa85","block_type":"box","text":"issuer rating or IDR, except DIP obligation ratings that are","page_number":577,"box":{"x":45,"y":544,"width":408,"height":13}},{"id":"9c59e9ac-9b00-4db3-a83d-8e629b4f77a3","block_type":"box","text":"not based off an IDR. At the lower end of the ratings scale, Fitch","page_number":577,"box":{"x":458,"y":544,"width":448,"height":13}},{"id":"d97d7f0b-266a-42b5-8f85-ee434f98c8ea","block_type":"box","text":"publishes explicit Recovery Ratings in many cases to","page_number":577,"box":{"x":45,"y":559,"width":364,"height":13}},{"id":"290f34b7-5d1e-440b-834e-0a8c32dc89db","block_type":"box","text":"complement issuer and obligation ratings.","page_number":577,"box":{"x":414,"y":559,"width":290,"height":13}},{"id":"1ea3824a-e1b5-4eca-90b3-2e7d8d93c2e5","block_type":"box","text":"Fitch long-term obligations rating scales are as follows:","page_number":577,"box":{"x":45,"y":583,"width":381,"height":12}},{"id":"dee3a87b-0a91-4baa-aa1c-8517e28214fc","block_type":"box","text":"AAA Highest Credit Quality. ‘AAA’ ratings denote the lowest expectation of credit risk. They are assigned","page_number":577,"box":{"x":45,"y":605,"width":885,"height":12}},{"id":"d1fde9b7-3719-4a0c-b226-79960aa43662","block_type":"box","text":"only in cases of exceptionally strong capacity for payment of financial commitments. This capacity is","page_number":577,"box":{"x":197,"y":619,"width":732,"height":13}},{"id":"cd277f70-0736-4966-9ba4-bbefa62966eb","block_type":"box","text":"highly unlikely to be adversely affected by foreseeable events.","page_number":577,"box":{"x":197,"y":633,"width":443,"height":13}},{"id":"e5e52060-a821-474e-bce5-da204a603be3","block_type":"box","text":"AA Very High Credit Quality. ‘AA’ ratings denote expectations of very low credit risk. They indicate very","page_number":577,"box":{"x":45,"y":652,"width":892,"height":13}},{"id":"ae14a1be-6190-42a4-b21d-a972f1a21fb5","block_type":"box","text":"strong capacity for payment of financial commitments. This capacity is not significantly vulnerable to","page_number":577,"box":{"x":197,"y":667,"width":737,"height":12}},{"id":"322737d4-8ad8-4e83-b806-77a07aa83d01","block_type":"box","text":"foreseeable events.","page_number":577,"box":{"x":197,"y":681,"width":133,"height":10}},{"id":"34db9075-8e63-4970-8363-d8eaa324ea18","block_type":"box","text":"A High Credit Quality. ‘A’ ratings denote expectations of low credit risk. The capacity for payment of","page_number":577,"box":{"x":45,"y":700,"width":878,"height":13}},{"id":"f13026b9-dfb4-44c7-ba45-16a593904312","block_type":"box","text":"financial commitments is considered strong. This capacity may, nevertheless, be more vulnerable to","page_number":577,"box":{"x":197,"y":714,"width":720,"height":13}},{"id":"86551b6d-e9d8-47bb-9c86-d276140e3519","block_type":"box","text":"adverse business or economic conditions than is the case for higher ratings.","page_number":577,"box":{"x":197,"y":729,"width":543,"height":12}},{"id":"6e474e63-3ab3-48ab-b592-f75f8b8ba4ba","block_type":"box","text":"BBB Good Credit Quality. ‘BBB’ ratings indicate that expectations of credit risk are currently low. The","page_number":577,"box":{"x":46,"y":748,"width":861,"height":13}},{"id":"daf530fb-0dad-4a39-a259-54b5cb9c4062","block_type":"box","text":"capacity for payment of financial commitments is considered adequate, but adverse business or","page_number":577,"box":{"x":197,"y":762,"width":689,"height":13}},{"id":"374786de-6d60-40db-ba88-41d5a368bea0","block_type":"box","text":"economic conditions are more likely to impair this capacity.","page_number":577,"box":{"x":197,"y":776,"width":434,"height":13}},{"id":"eede960f-41a2-4907-8fd2-2787ac4d7cea","block_type":"box","text":"BB Speculative. ‘BB’ ratings indicate an elevated vulnerability to credit risk, particularly in the event of","page_number":577,"box":{"x":46,"y":796,"width":871,"height":13}},{"id":"65526cc2-e651-40db-a2f2-f3cb49552fc7","block_type":"box","text":"adverse changes in business or economic conditions over time; however, business or financial","page_number":577,"box":{"x":197,"y":810,"width":675,"height":13}},{"id":"d6105094-6ec6-47de-8e0f-d99c73f04078","block_type":"box","text":"alternatives may be available to allow financial commitments to be met.","page_number":577,"box":{"x":197,"y":824,"width":521,"height":13}},{"id":"20865f58-2e7c-4b49-a1e2-815f302c9b9e","block_type":"box","text":"B Highly Speculative. ‘B’ ratings indicate that material credit risk is present.","page_number":577,"box":{"x":46,"y":844,"width":684,"height":12}},{"id":"f0aaca35-3cf7-4ec8-806f-30b703e961eb","block_type":"box","text":"CCC Substantial Credit Risk. ‘CCC’ ratings indicate that substantial credit risk is present.","page_number":577,"box":{"x":46,"y":863,"width":762,"height":13}},{"id":"98d09105-6982-4654-9345-dab3fb077601","block_type":"box","text":"A-7","page_number":577,"box":{"x":486,"y":916,"width":27,"height":10}},{"id":"3e2753ca-c1d3-49be-b1a1-61ddfb0b5e9b","block_type":"box","text":"NM1026U-6004382-577/605","page_number":577,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"58a1cd0b-8078-479a-a3b3-5ca86a67f60c","block_type":"box","text":"CC Very High Levels of Credit Risk. ‘CC’ ratings indicate very high levels of credit risk.","page_number":578,"box":{"x":46,"y":83,"width":760,"height":12}},{"id":"2f5b19de-9ab3-4722-b65b-1a7b83f8c450","block_type":"box","text":"C Exceptionally High Levels of Credit Risk. ‘C’ indicates exceptionally high levels of credit risk.","page_number":578,"box":{"x":46,"y":102,"width":831,"height":13}},{"id":"cfe927c3-2974-40ac-89c9-c7141aa5b080","block_type":"box","text":"Within rating categories, Fitch may use modifiers. The modifiers “+” or “-” may be appended to a rating to denote relative status","page_number":578,"box":{"x":45,"y":125,"width":898,"height":13}},{"id":"982c811d-1ef0-402a-95c0-f2a4c92c435d","block_type":"box","text":"within major rating categories.","page_number":578,"box":{"x":45,"y":141,"width":213,"height":13}},{"id":"2c497686-b740-44e1-b197-59af5e6dad83","block_type":"box","text":"For example, the rating category ‘AA’ has three notch-specific ra","page_number":578,"box":{"x":45,"y":164,"width":448,"height":13}},{"id":"27a842dd-fe98-4e03-b757-d4399f586c74","block_type":"box","text":"ting levels (‘AA+’; ‘AA’; ‘AA–’; each a rating level). Such suffixes","page_number":578,"box":{"x":494,"y":164,"width":447,"height":13}},{"id":"8b9baac6-f608-43fe-9b83-e65e0b383ea1","block_type":"box","text":"are not added to ‘AAA’ ratings and ratings below the ‘CCC’ category. For the short-term rating category of ‘F1’, a ‘+’ may be","page_number":578,"box":{"x":46,"y":180,"width":869,"height":12}},{"id":"d591ad31-ae40-44e0-8640-b2c537d19aab","block_type":"box","text":"appended.","page_number":578,"box":{"x":46,"y":195,"width":70,"height":13}},{"id":"065faa9f-f351-4360-bf9c-066f0d6072fb","block_type":"box","text":"Description of Fitch’s Short-Term Ratings Assigned to Issuers and Obligations","page_number":578,"box":{"x":45,"y":223,"width":570,"height":13}},{"id":"78fc8ddc-7457-4498-bd0a-d1702102b36e","block_type":"box","text":"A short-term issuer or obligation rating is based in all cases on th","page_number":578,"box":{"x":45,"y":249,"width":451,"height":13}},{"id":"c8e2a7bd-aa18-4122-80b7-9c16c3cf7010","block_type":"box","text":"e short-term vulnerability to default of the rated entity and relates","page_number":578,"box":{"x":497,"y":249,"width":455,"height":13}},{"id":"d952d99a-12f0-4db5-aab4-8f55841e08b0","block_type":"box","text":"to the capacity to meet financial obligations in accordance with th","page_number":578,"box":{"x":45,"y":265,"width":458,"height":13}},{"id":"cacbdc0b-8a71-4a8f-96af-1f75d905644f","block_type":"box","text":"e documentation governing the relevant obligation. Short-term","page_number":578,"box":{"x":504,"y":265,"width":434,"height":13}},{"id":"972c00f0-f486-4b03-ab74-84e6490561b0","block_type":"box","text":"deposit ratings may be adjusted for loss severity. Short-term ratings are assigned to obligations whose initial maturity is viewed as","page_number":578,"box":{"x":46,"y":280,"width":898,"height":13}},{"id":"c1c6d9b4-157b-43b4-9688-f33ce7ab83cc","block_type":"box","text":"“short term” based on market convention. Typically, this means up to 13 months for corporate, sovereign, and structured","page_number":578,"box":{"x":47,"y":296,"width":846,"height":13}},{"id":"ceec32b9-60ba-49b0-9b3e-da1125bd75cb","block_type":"box","text":"obligations and up to 36 months for obligations in U.S. public finance markets.","page_number":578,"box":{"x":46,"y":311,"width":548,"height":13}},{"id":"d90f308c-379d-44f0-98a5-406050887fdd","block_type":"box","text":"Fitch short-term ratings are as follows:","page_number":578,"box":{"x":45,"y":335,"width":268,"height":12}},{"id":"cb3b0fd9-1120-4e97-9498-3a0943d483cd","block_type":"box","text":"F1 Highest Short-Term Credit Quality. Indicates the strongest intrinsic capacity for timely payment of","page_number":578,"box":{"x":45,"y":357,"width":870,"height":12}},{"id":"99fa6936-b2e0-44f8-95e6-03b8bf2651a4","block_type":"box","text":"financial commitments; may have an added “+” to denote any exceptionally strong credit feature.","page_number":578,"box":{"x":197,"y":371,"width":708,"height":13}},{"id":"e66f5886-9e60-4315-9e0b-a5ffed82467e","block_type":"box","text":"F2 Good Short-Term Credit Quality. Good intrinsic capacity for timely payment of financial","page_number":578,"box":{"x":45,"y":390,"width":801,"height":13}},{"id":"2b5beb2b-9863-480c-ba6d-1475010683ce","block_type":"box","text":"commitments.","page_number":578,"box":{"x":197,"y":405,"width":101,"height":9}},{"id":"3866b729-f9e8-414b-be4d-2dca9db15739","block_type":"box","text":"F3 Fair Short-Term Credit Quality. The intrinsic capacity for timely payment of financial commitments is","page_number":578,"box":{"x":45,"y":424,"width":894,"height":13}},{"id":"8d19aa7a-642e-411d-93c2-1a91c7406204","block_type":"box","text":"adequate.","page_number":578,"box":{"x":197,"y":438,"width":68,"height":13}},{"id":"cd8a1a4e-5e74-4d03-8c8f-22e9038ed18d","block_type":"box","text":"B Speculative Short-Term Credit Quality. Minimal capacity for timely payment of financial commitments,","page_number":578,"box":{"x":46,"y":457,"width":905,"height":13}},{"id":"c07c5823-ea1a-47fa-9695-98aac320504a","block_type":"box","text":"plus heightened vulnerability to near term adverse changes in financial and economic conditions.","page_number":578,"box":{"x":197,"y":472,"width":701,"height":12}},{"id":"7519888f-3338-4a15-864a-b833b0996cdc","block_type":"box","text":"C High Short-Term Default Risk. Default is a real possibility.","page_number":578,"box":{"x":46,"y":491,"width":579,"height":13}},{"id":"39434bdc-fd2c-4fc4-b888-00ad986f2692","block_type":"box","text":"RD Restricted Default. Indicates an entity that has defaulted on one or more of its financial commitments,","page_number":578,"box":{"x":46,"y":510,"width":892,"height":13}},{"id":"9057b1ca-5796-45cb-8a60-49fd5e098f32","block_type":"box","text":"although it continues to meet other financial obligations. Typically applicable to entity ratings only.","page_number":578,"box":{"x":197,"y":525,"width":724,"height":12}},{"id":"4c16194b-a95c-4537-b919-3fbcd7c10a1a","block_type":"box","text":"D Default. Indicates a broad-based default event for an entity, or the default of a short-term obligation.","page_number":578,"box":{"x":45,"y":544,"width":885,"height":13}},{"id":"0a1de613-9681-40a7-8d83-339e6f34a8d4","block_type":"box","text":"A-8","page_number":578,"box":{"x":486,"y":916,"width":26,"height":10}},{"id":"cd0209c6-d2c7-4976-85cd-99e4bab7bce2","block_type":"box","text":"NM1026U-6004382-578/605","page_number":578,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3f6d3718-2c43-49df-bb3a-fd1b6906c427","block_type":"box","text":"Open-End Active and Fixed Income Index Fund Proxy Voting Policy","page_number":579,"box":{"x":380,"y":87,"width":508,"height":12}},{"id":"acffc544-c406-4ff1-911c-16f84fb3eb23","block_type":"box","text":"Appendix B","page_number":579,"box":{"x":453,"y":118,"width":98,"height":11}},{"id":"e70ea8a3-95c4-446c-a813-622470f58a35","block_type":"box","text":"Open-End Active and Fixed Income Index Fund Proxy Voting Policy","page_number":579,"box":{"x":230,"y":148,"width":544,"height":12}},{"id":"d495d769-668b-403e-adcf-bf874d14ea72","block_type":"box","text":"Procedures Governing Delegation of Proxy Voting to Fund Advisers","page_number":579,"box":{"x":229,"y":178,"width":547,"height":12}},{"id":"21df61d3-76a5-4957-9a8a-22d48395d8bb","block_type":"box","text":"Effective Date: January 1, 2025","page_number":579,"box":{"x":383,"y":209,"width":239,"height":12}},{"id":"5db3e1cd-26ba-4f64-8793-8f0a3dbc230d","block_type":"box","text":"Applies to the following types of Funds registered under the 1940 Act:","page_number":579,"box":{"x":116,"y":247,"width":566,"height":12}},{"id":"e99ddb74-d8bc-4d93-97f1-a7518a3f96b0","block_type":"box","text":"‘","page_number":579,"box":{"x":116,"y":276,"width":16,"height":12}},{"id":"c83d9db7-65ea-4f55-bc4a-1d3596818ddc","block_type":"box","text":"Index Equity Mutual Funds and Exchange-Traded Funds","page_number":579,"box":{"x":132,"y":277,"width":444,"height":12}},{"id":"4c097552-a22c-403a-a0ae-ff78965f46af","block_type":"box","text":"È","page_number":579,"box":{"x":116,"y":292,"width":16,"height":12}},{"id":"c6a13411-9908-42eb-9d63-93bdb0d6eb3a","block_type":"box","text":"Open-End Active and Fixed Income Index Mutual Funds and Exchange-Traded Funds","page_number":579,"box":{"x":132,"y":293,"width":663,"height":12}},{"id":"04a5c17a-20f3-4df0-8296-278c91a4eb88","block_type":"box","text":"‘","page_number":579,"box":{"x":116,"y":307,"width":16,"height":12}},{"id":"8fc7fb5b-c190-4547-84be-402df458566e","block_type":"box","text":"Money Market Funds","page_number":579,"box":{"x":132,"y":308,"width":180,"height":12}},{"id":"a284ff98-baa2-4230-a2e1-f892eb979e99","block_type":"box","text":"‘","page_number":579,"box":{"x":116,"y":323,"width":16,"height":12}},{"id":"adfbd191-1499-4067-8121-0cec762875da","block_type":"box","text":"Closed-End Funds","page_number":579,"box":{"x":132,"y":324,"width":161,"height":9}},{"id":"27e98aff-7846-4b24-8858-c076cef7fbeb","block_type":"box","text":"‘","page_number":579,"box":{"x":116,"y":338,"width":16,"height":12}},{"id":"8e35ffc2-1d52-42c0-a402-ccb97a1f8f2f","block_type":"box","text":"Other","page_number":579,"box":{"x":132,"y":339,"width":64,"height":10}},{"id":"e82eae24-b3bb-44c1-be60-615c8e8f329e","block_type":"box","text":"Objective and Scope","page_number":579,"box":{"x":116,"y":369,"width":170,"height":13}},{"id":"ff734805-23c7-415e-a73d-b59a9354c24e","block_type":"box","text":"Set forth below is the Open-End Active and Fixed Income Index Fund Proxy Voting Policy.","page_number":579,"box":{"x":116,"y":400,"width":675,"height":12}},{"id":"c6b99da6-7de9-4880-943d-88aa528907d6","block_type":"box","text":"Policy / Document Requirements and Statements","page_number":579,"box":{"x":117,"y":430,"width":396,"height":12}},{"id":"888ba46a-ef18-4643-a708-1ef7a085ec97","block_type":"box","text":"The Boards of Trustees/Directors (“Directors”) of certain open-end funds (the “Funds”) advised by","page_number":579,"box":{"x":116,"y":461,"width":730,"height":12}},{"id":"e014409b-694a-4461-9883-45f9449975d8","block_type":"box","text":"BlackRock Fund Advisors or BlackRock Advisors, LLC (“BlackRock”), have the responsibility for the","page_number":579,"box":{"x":117,"y":476,"width":743,"height":12}},{"id":"efd7cbc0-d5c0-4a74-9960-54524ef38135","block_type":"box","text":"oversight of voting proxies relating to portfolio securities of the Funds, and have determined that it is in","page_number":579,"box":{"x":116,"y":492,"width":765,"height":12}},{"id":"8b70bce4-1e4c-43a0-a804-e70509d0e3e8","block_type":"box","text":"the best interests of the Funds and their shareholders to delegate the responsibility to vote proxies to","page_number":579,"box":{"x":116,"y":507,"width":754,"height":12}},{"id":"0289ebca-2ee8-42a8-8fd3-d572a840845d","block_type":"box","text":"BlackRock, subject to the principles outlined in this Policy, as part of BlackRock’s authority to manage,","page_number":579,"box":{"x":117,"y":523,"width":764,"height":12}},{"id":"063fc012-f796-46e5-bcfe-0424d7eda0fb","block_type":"box","text":"acquire and dispose of account assets, all as contemplated by the Funds’ respective investment","page_number":579,"box":{"x":116,"y":538,"width":718,"height":12}},{"id":"d367cfd1-12c2-4f0f-a4d4-b2555ac0cb58","block_type":"box","text":"management agreements.","page_number":579,"box":{"x":117,"y":554,"width":200,"height":12}},{"id":"c94bd81b-1db7-4912-81e7-e8a419246844","block_type":"box","text":"BlackRock has adopted the BlackRock Active Investment Stewardship Global Engagement and Voting","page_number":579,"box":{"x":117,"y":584,"width":766,"height":12}},{"id":"b30708ca-d0c7-4a6b-976b-65f21a50e0b7","block_type":"box","text":"Guidelines (as from time to time amended, the “Guidelines”) governing proxy voting by active and fixed","page_number":579,"box":{"x":117,"y":600,"width":768,"height":12}},{"id":"ad4d6726-3291-455d-9cd3-682151d516ca","block_type":"box","text":"income index Funds managed by BlackRock. The Guidelines include “climate and decarbonization”","page_number":579,"box":{"x":117,"y":615,"width":741,"height":12}},{"id":"ca1f48d7-386b-4a5b-bd2a-c3c2cf2f17e8","block_type":"box","text":"guidelines which apply to the Funds listed in Appendix A, if any.","page_number":579,"box":{"x":116,"y":631,"width":477,"height":12}},{"id":"350472ef-1ecc-470b-a4ee-08200d3c5ee2","block_type":"box","text":"BlackRock will cast votes on behalf of each of the Funds covered by this policy on specific proxy","page_number":579,"box":{"x":117,"y":661,"width":714,"height":12}},{"id":"53b752ce-f63c-48b4-8788-dcabe727966c","block_type":"box","text":"issues in respect of securities held by each such Fund (or may refrain from voting) in accordance with","page_number":579,"box":{"x":117,"y":677,"width":753,"height":12}},{"id":"fd6dea2c-5254-4425-8297-e8fb31a28ec9","block_type":"box","text":"the Guidelines.","page_number":579,"box":{"x":116,"y":692,"width":110,"height":10}},{"id":"5435db3e-8002-40fb-b4df-cea44c8924de","block_type":"box","text":"Conflicts Management","page_number":579,"box":{"x":116,"y":723,"width":179,"height":12}},{"id":"9d5933dd-6b4a-4e39-b810-2ca36cac3643","block_type":"box","text":"BlackRock Active Investment Stewardship (“BAIS”) maintains policies and procedures that seek to","page_number":579,"box":{"x":117,"y":753,"width":729,"height":12}},{"id":"50db92f8-5751-40e0-b62a-2b96ee1776aa","block_type":"box","text":"prevent undue influence on BlackRock’s proxy voting activity and to mitigate material conflicts of","page_number":579,"box":{"x":117,"y":769,"width":714,"height":12}},{"id":"a8cfab55-a46c-47d7-aec7-dc34fc67455d","block_type":"box","text":"interest in the exercise of proxy voting responsibilities. 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In mitigating conflicts, BAIS will adhere to the Guidelines.","page_number":579,"box":{"x":116,"y":846,"width":719,"height":12}},{"id":"2c0b2756-d436-4421-a757-1ab6df6c750d","block_type":"box","text":"BlackRock","page_number":579,"box":{"x":117,"y":878,"width":89,"height":9}},{"id":"31d5c66a-4a60-4223-9249-e20af0cd0d7b","block_type":"box","text":"Public Page 1 of 3","page_number":579,"box":{"x":488,"y":878,"width":400,"height":12}},{"id":"a398fb1f-ff1d-4f31-b376-94e208c19e17","block_type":"box","text":"NM1026U-6004382-579/605","page_number":579,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f1c97df1-e1aa-4921-859f-30daddc56fab","block_type":"box","text":"Open-End Active and Fixed Income Index Fund Proxy Voting Policy","page_number":580,"box":{"x":380,"y":87,"width":508,"height":12}},{"id":"c2f10cac-80ad-4563-b1d4-17f0df883053","block_type":"box","text":"In certain instances, BAIS will engage an independent third-party voting service provider to make proxy","page_number":580,"box":{"x":117,"y":118,"width":770,"height":12}},{"id":"e03c8254-6e83-4654-b5d0-26f929cb5078","block_type":"box","text":"voting recommendations as a further safeguard to avoid potential conflicts of interest, to satisfy","page_number":580,"box":{"x":116,"y":134,"width":709,"height":12}},{"id":"0537e7e7-d484-4d48-9f0a-fac9f23aa044","block_type":"box","text":"regulatory compliance requirements, or as may be otherwise required by applicable law.","page_number":580,"box":{"x":117,"y":149,"width":658,"height":12}},{"id":"4f09c6a9-7c3c-4488-83ea-5ec704faa131","block_type":"box","text":"With respect to the relationship between securities lending and proxy voting, shares on loan cannot be","page_number":580,"box":{"x":116,"y":180,"width":765,"height":12}},{"id":"8476bd1c-f856-44b1-bd16-ed863e95920d","block_type":"box","text":"voted and BlackRock may determine to recall them for voting, as guided by BlackRock’s fiduciary","page_number":580,"box":{"x":116,"y":196,"width":727,"height":12}},{"id":"0419c4a9-f6e5-45b8-b5bf-a1251a3a5876","block_type":"box","text":"responsibility to act in clients’ financial interests. 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There are separate, independently developed principles and","page_number":584,"box":{"x":116,"y":304,"width":748,"height":12}},{"id":"c0fb15af-5528-455a-908e-3c6a0dfd9946","block_type":"box","text":"voting policies that are applied to BlackRock’s index equity investments by a distinct and independent","page_number":584,"box":{"x":116,"y":320,"width":758,"height":12}},{"id":"b5c04a2a-3c9e-4299-afce-e3f765d4568b","block_type":"box","text":"function, BlackRock Investment Stewardship.","page_number":584,"box":{"x":116,"y":335,"width":341,"height":12}},{"id":"c542783a-3cb3-48cb-a392-d06e8af2793c","block_type":"box","text":"1","page_number":584,"box":{"x":144,"y":789,"width":2,"height":5}},{"id":"1cd17ea8-2139-46ea-815f-279290519503","block_type":"box","text":"This document includes BAIS’ benchmark policy, which covers nearly all active equity holdings in BlackRock’s","page_number":584,"box":{"x":170,"y":789,"width":653,"height":10}},{"id":"ec241aa9-bd13-465f-87c9-c2484d47a73e","block_type":"box","text":"fundamental equity, systematic equity and multi-asset solutions strategies. The benchmark policy also may apply to","page_number":584,"box":{"x":170,"y":802,"width":685,"height":10}},{"id":"a1237604-e2e5-4a22-b24a-707b70529110","block_type":"box","text":"holdings in BlackRock’s index and active fixed income strategies, to the extent those strategies hold voting securities or","page_number":584,"box":{"x":170,"y":815,"width":709,"height":10}},{"id":"76b6abb8-b4a5-40a9-b078-b67f2df1c38e","block_type":"box","text":"conduct issuer engagements. This document also includes BAIS’ decarbonization policy, which covers holdings in","page_number":584,"box":{"x":170,"y":828,"width":676,"height":10}},{"id":"077d85cb-9c7e-4326-8f96-6381f95a3e3f","block_type":"box","text":"BlackRock active funds that have climate and decarbonization objectives in addition to financial objectives.","page_number":584,"box":{"x":171,"y":841,"width":631,"height":9}},{"id":"caecaa31-1cb9-42c0-998f-a3fc1a9848be","block_type":"box","text":"2","page_number":584,"box":{"x":143,"y":854,"width":4,"height":5}},{"id":"3bdbb884-9b05-4ab5-8282-ed1841079c3a","block_type":"box","text":"BlackRock segmented active and index equity investment functions, including stewardship, in January 2025 as part of a","page_number":584,"box":{"x":171,"y":854,"width":709,"height":9}},{"id":"b3362747-d360-4b92-83ab-1c4bc2d49730","block_type":"box","text":"strategic initiative to unlock the full breadth of the firm’s active and private markets capabilities for clients. As a result,","page_number":584,"box":{"x":170,"y":867,"width":692,"height":9}},{"id":"b0555eb6-57a6-4a94-8ca1-3fc393a849fc","block_type":"box","text":"there are two stewardship teams, which operate independently of one another and have separate voting policies.","page_number":584,"box":{"x":170,"y":880,"width":669,"height":9}},{"id":"f723eb5a-79d3-4fc9-940b-686e2be7a674","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":584,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"6996a241-cb0a-49bf-aaef-3d38f8ecee58","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":584,"box":{"x":543,"y":909,"width":325,"height":12}},{"id":"6ec19102-335b-4015-9762-3bd13c125b52","block_type":"box","text":"3","page_number":584,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"93dd236b-2388-4152-a45b-fe80fd5ed88a","block_type":"box","text":"NM1026U-6004382-584/605","page_number":584,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3b498a12-fcdc-4970-9130-bd50f3b5fcd4","block_type":"box","text":"Introduction to BlackRock","page_number":585,"box":{"x":396,"y":87,"width":213,"height":10}},{"id":"4ca0a63d-9d33-47fd-bcc0-1cdb29274e7e","block_type":"box","text":"BlackRock’s mission is to help more people invest better. The money BlackRock manages is not its","page_number":585,"box":{"x":117,"y":118,"width":741,"height":12}},{"id":"8d083e5c-7eb9-4467-9baf-0a6aace2422c","block_type":"box","text":"own — it belongs to BlackRock’s clients, many of whom make their own asset allocation and portfolio","page_number":585,"box":{"x":116,"y":134,"width":756,"height":12}},{"id":"f80fa47a-f12a-40fb-9e34-123e08dd4ffb","block_type":"box","text":"construction decisions. As a fiduciary, BlackRock invests on clients’ behalf to help them meet their","page_number":585,"box":{"x":116,"y":149,"width":733,"height":12}},{"id":"4b58f8e6-e987-4217-9e60-666127b98af5","block_type":"box","text":"investment objectives. The firm does this by understanding clients’ long-term investment objectives","page_number":585,"box":{"x":117,"y":165,"width":739,"height":12}},{"id":"be4c53ba-737f-4a46-82d0-21a77cfc4d47","block_type":"box","text":"and offering choice on how and where they wish to invest their money. BlackRock then helps clients","page_number":585,"box":{"x":116,"y":180,"width":747,"height":12}},{"id":"b4b5956d-cfab-4281-918b-29ff09409d5f","block_type":"box","text":"seek the best risk-adjusted returns based on those choices, underpinning this work with research, data","page_number":585,"box":{"x":116,"y":196,"width":768,"height":12}},{"id":"3cf86922-3fd9-4b8f-8f13-d349f8babc93","block_type":"box","text":"and analytics.","page_number":585,"box":{"x":116,"y":211,"width":107,"height":12}},{"id":"65ea9e99-a0c4-42b1-a96b-5b0a42c346da","block_type":"box","text":"At BlackRock, investment stewardship is core to our role as an asset manager and a fiduciary to our","page_number":585,"box":{"x":116,"y":242,"width":748,"height":12}},{"id":"36c4efb7-93ff-4e56-84b6-57f72b3ae144","block_type":"box","text":"clients. As stewards of our clients’ assets, we engage with companies to discuss the corporate","page_number":585,"box":{"x":116,"y":258,"width":706,"height":12}},{"id":"4ccb17b0-85d1-4bd8-9147-2dc0b08dac59","block_type":"box","text":"governance and business practices that, in our experience, support companies in delivering durable,","page_number":585,"box":{"x":116,"y":273,"width":751,"height":12}},{"id":"a5ddb760-5be4-4395-9e0a-4166b5becb52","block_type":"box","text":"risk-adjusted financial returns over time. We are committed to building strong relationships through","page_number":585,"box":{"x":117,"y":289,"width":736,"height":12}},{"id":"0d8365ec-68aa-41f5-bcd3-81ca3e982faf","block_type":"box","text":"constructive, ongoing dialogue with the boards and executive management of the companies in which","page_number":585,"box":{"x":116,"y":304,"width":760,"height":12}},{"id":"e80b947e-68f5-40f2-a99c-59ed2d77e05a","block_type":"box","text":"our clients are invested.","page_number":585,"box":{"x":116,"y":320,"width":182,"height":9}},{"id":"908f9a75-df43-4b14-b111-02999947f91e","block_type":"box","text":"About BlackRock Active Investment Stewardship","page_number":585,"box":{"x":303,"y":351,"width":398,"height":11}},{"id":"7a944f5b-9ee3-44b2-91ff-945b30435ffa","block_type":"box","text":"BlackRock Active Investment Stewardship (BAIS) is a specialist team within the Portfolio Management","page_number":585,"box":{"x":117,"y":382,"width":764,"height":12}},{"id":"3a4c8ce7-3a69-4a95-aba6-cf425f167dfe","block_type":"box","text":"Group and manages BlackRock’s stewardship engagement and voting on behalf of clients invested in","page_number":585,"box":{"x":117,"y":397,"width":758,"height":12}},{"id":"67ee20e7-ef37-45ef-b639-40d23c716696","block_type":"box","text":"active strategies globally. BAIS is also responsible for engagement with issuers in index fixed income","page_number":585,"box":{"x":116,"y":413,"width":755,"height":12}},{"id":"4a3b70d9-d4dc-494e-9b89-4cd7b5c17ecf","block_type":"box","text":"strategies, where appropriate. Our activities are informed by these Global Engagement and Voting","page_number":585,"box":{"x":116,"y":428,"width":735,"height":12}},{"id":"66deebf8-f7c7-436f-b83e-0c6ea52c49b5","block_type":"box","text":"Guidelines (the “Guidelines”) and insights from active investment analysts and portfolio managers, with","page_number":585,"box":{"x":117,"y":444,"width":768,"height":12}},{"id":"dc71ed2b-ca94-4b69-84d1-b64ffed3ec40","block_type":"box","text":"whom we work closely in engaging companies and voting at shareholder meetings.","page_number":585,"box":{"x":116,"y":459,"width":622,"height":12}},{"id":"cc85a0da-eae7-4022-a594-02489d35d388","block_type":"box","text":"Engagement with public companies is the foundation of our approach to stewardship within","page_number":585,"box":{"x":117,"y":490,"width":680,"height":12}},{"id":"e443c391-1b7a-470e-8a96-3972d30035a7","block_type":"box","text":"fundamental active investing.","page_number":585,"box":{"x":116,"y":506,"width":215,"height":12}},{"id":"285dc5c9-c949-4e4e-8659-51f81c52fb65","block_type":"box","text":"3","page_number":585,"box":{"x":333,"y":506,"width":5,"height":6}},{"id":"272f856a-ee6d-4220-ad2f-a12c884d50e0","block_type":"box","text":"Through direct dialogue with company leadership, we seek to","page_number":585,"box":{"x":339,"y":506,"width":466,"height":12}},{"id":"dd01dac5-84e3-4d6b-a58e-6875adaba0cd","block_type":"box","text":"understand their businesses and how they manage risks and opportunities to deliver durable, risk","page_number":585,"box":{"x":117,"y":521,"width":727,"height":12}},{"id":"73c61b3a-324d-447e-941a-08f95e3a9201","block_type":"box","text":"adjusted financial returns. Portfolio managers and stewardship specialists may engage jointly or","page_number":585,"box":{"x":116,"y":537,"width":716,"height":12}},{"id":"091b761e-1443-46b9-b971-51dffe0985d0","block_type":"box","text":"independently on material corporate governance matters. Our discussions focus on topics relevant to a","page_number":585,"box":{"x":117,"y":552,"width":769,"height":12}},{"id":"e3633e33-8437-47ce-8a5a-3fe6857b3ec5","block_type":"box","text":"company’s success over time, including governance and leadership, corporate strategy, capital","page_number":585,"box":{"x":116,"y":568,"width":711,"height":12}},{"id":"383a4031-42e0-4631-a7e4-2f5a0e6827e1","block_type":"box","text":"structure and financial performance, operations and material sustainability-related risks, as well as","page_number":585,"box":{"x":116,"y":583,"width":734,"height":12}},{"id":"6af4a1d1-baf7-4dd3-a381-deaf279db913","block_type":"box","text":"macro-economic, geopolitical and sector dynamics. We aim to be constructive investors and are","page_number":585,"box":{"x":117,"y":599,"width":717,"height":12}},{"id":"c0dfddbf-2c50-4b2b-b14b-d47266c2a2cb","block_type":"box","text":"generally supportive of management teams that have a track record of financial value creation. We aim","page_number":585,"box":{"x":116,"y":614,"width":770,"height":12}},{"id":"4f075be0-dd76-4481-b45f-4971932940b3","block_type":"box","text":"to build and maintain strong relationships with company leadership based on open dialogue and","page_number":585,"box":{"x":116,"y":630,"width":717,"height":12}},{"id":"c7297b78-ccf3-4e88-b083-9775f776f319","block_type":"box","text":"mutual respect.","page_number":585,"box":{"x":117,"y":645,"width":118,"height":12}},{"id":"11af5d05-e602-4c13-a3ea-d4782484d48e","block_type":"box","text":"Different active equity strategies may implement these voting guidelines differently, as a result of the","page_number":585,"box":{"x":117,"y":676,"width":744,"height":12}},{"id":"a926c91d-108c-4406-98da-c2ea6ec1640f","block_type":"box","text":"latitude each portfolio manager has to make independent voting decisions on their holdings. For","page_number":585,"box":{"x":117,"y":692,"width":711,"height":12}},{"id":"6bafb9bb-429a-411c-8e4e-51c9eb316804","block_type":"box","text":"example, BAIS will generally vote the holdings in Systematic Active Equity portfolios in accordance","page_number":585,"box":{"x":116,"y":707,"width":732,"height":12}},{"id":"f6d41b11-123e-4e13-b404-a1540c4aa1a5","block_type":"box","text":"with these guidelines. We provide voting recommendations to fundamental equity portfolio managers,","page_number":585,"box":{"x":116,"y":723,"width":751,"height":12}},{"id":"0e620f7d-830f-4c2e-aa29-45d396db2e96","block_type":"box","text":"who may determine to vote differently based on each portfolio’s investment objectives and strategy.","page_number":585,"box":{"x":116,"y":738,"width":737,"height":12}},{"id":"836201fe-46a9-4a17-a672-fad589ee5a41","block_type":"box","text":"3","page_number":585,"box":{"x":143,"y":841,"width":4,"height":5}},{"id":"3076c20c-8548-4ab2-997d-465a952cbaa2","block_type":"box","text":"On February 11, 2025, the U.S. Securities and Exchange Commission (SEC) staff issued updated guidance for","page_number":585,"box":{"x":170,"y":841,"width":660,"height":9}},{"id":"87a67491-772d-43f3-998a-ef36e1cf9d8f","block_type":"box","text":"shareholders to maintain their eligibility to report their beneficial ownership under Schedule 13G of the Exchange Act.","page_number":585,"box":{"x":170,"y":854,"width":695,"height":9}},{"id":"b5239d91-eaf1-4573-851a-a5eebe188cfe","block_type":"box","text":"We comply fully with these requirements and do not engage with portfolio companies for the purpose, or with the effect,","page_number":585,"box":{"x":170,"y":867,"width":707,"height":9}},{"id":"b8b60829-eab6-4973-8e77-f2973f2e888f","block_type":"box","text":"of changing or influencing control of the company.","page_number":585,"box":{"x":170,"y":880,"width":295,"height":9}},{"id":"86333b69-0442-4aec-9cb2-08d2e015727d","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":585,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"a6303bf5-5aa9-4ceb-bf73-28a9d3756b59","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":585,"box":{"x":543,"y":909,"width":325,"height":12}},{"id":"1ad49f38-56cd-45cd-ba32-1638df9c0f3f","block_type":"box","text":"4","page_number":585,"box":{"x":874,"y":909,"width":9,"height":9}},{"id":"0d950e85-e5d7-41d0-884f-1fda7804e053","block_type":"box","text":"NM1026U-6004382-585/605","page_number":585,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"163c2964-4db4-4b6d-9f90-a53853db1767","block_type":"box","text":"These guidelines discuss BAIS’ views on corporate governance topics on which we may engage with","page_number":586,"box":{"x":116,"y":87,"width":755,"height":12}},{"id":"3f325660-2b76-40bf-b6bd-618c01dd506b","block_type":"box","text":"management teams and board directors","page_number":586,"box":{"x":117,"y":103,"width":297,"height":12}},{"id":"06ea2cdf-46dc-4f74-9118-1f133ed040aa","block_type":"box","text":"4","page_number":586,"box":{"x":414,"y":103,"width":6,"height":6}},{"id":"60c44c6e-3064-4db2-9178-82563f9cc39e","block_type":"box","text":"and on matters that routinely come to a shareholder vote. We","page_number":586,"box":{"x":424,"y":103,"width":461,"height":12}},{"id":"5f598d43-713b-4336-aa5e-2e826f691a53","block_type":"box","text":"recognize that accepted corporate governance norms can differ across markets, and believe these","page_number":586,"box":{"x":117,"y":118,"width":736,"height":12}},{"id":"5af625ee-173e-4e36-bd3a-4ef7f493a044","block_type":"box","text":"guidelines represent globally applicable elements of governance that support a company’s ability to","page_number":586,"box":{"x":116,"y":134,"width":741,"height":12}},{"id":"a957f15c-0677-4c8d-a8e5-c1f343688f2b","block_type":"box","text":"manage material risks and opportunities and deliver financial returns to investors. Generally, we","page_number":586,"box":{"x":117,"y":149,"width":715,"height":12}},{"id":"9944f149-d04b-4f0b-8776-fa7b891f5bb3","block_type":"box","text":"believe companies should observe accepted corporate governance norms within their local markets or,","page_number":586,"box":{"x":117,"y":165,"width":768,"height":12}},{"id":"4e2856f3-7148-4c31-92f9-04efa742ff9f","block_type":"box","text":"particularly in markets without well-established norms, aspire to widely recognized international best","page_number":586,"box":{"x":117,"y":180,"width":746,"height":12}},{"id":"294a4bbf-9d01-44ac-adaf-4156b0abaa81","block_type":"box","text":"practices. As one of many minority shareholders, BlackRock cannot — and does not try to — direct a","page_number":586,"box":{"x":117,"y":196,"width":754,"height":12}},{"id":"a30e8dce-9907-488a-8b32-27fc66d4be8d","block_type":"box","text":"company’s strategy or its implementation. We look to companies to provide disclosures that explain","page_number":586,"box":{"x":116,"y":211,"width":743,"height":12}},{"id":"345ab800-8fce-42cd-a6e4-f5aef4f8d115","block_type":"box","text":"how their approach to corporate governance best aligns with the financial interests of their investors.","page_number":586,"box":{"x":117,"y":227,"width":749,"height":12}},{"id":"14ec81e3-16a5-4f63-a8ea-f8f93fcca8ac","block_type":"box","text":"Our approach to stewardship within active equities","page_number":586,"box":{"x":296,"y":258,"width":412,"height":11}},{"id":"87ea0a1c-e7e9-4ff4-8007-04d0f5ef9ce2","block_type":"box","text":"Voting at a company’s shareholder meeting is a right of share ownership and a core principle of","page_number":586,"box":{"x":116,"y":289,"width":713,"height":12}},{"id":"c78e2de4-daef-42ca-8fb1-ae3e09145e33","block_type":"box","text":"corporate governance. The voting rights attached to clients’ holdings are an important mechanism for","page_number":586,"box":{"x":116,"y":304,"width":756,"height":12}},{"id":"df715f21-8601-4075-bfc4-133a02142a6f","block_type":"box","text":"investors to express support for, or concern about, a company’s performance. As a fiduciary,","page_number":586,"box":{"x":117,"y":320,"width":692,"height":12}},{"id":"91a74f71-6fed-4e2e-864f-240bb3c71e00","block_type":"box","text":"BlackRock is legally required to make proxy voting determinations, on behalf of clients who have","page_number":586,"box":{"x":117,"y":335,"width":720,"height":12}},{"id":"ac8a0720-3fef-42b9-b686-f66ce18be7f9","block_type":"box","text":"delegated voting authority to us, in a manner consistent with BlackRock’s contractual arrangements","page_number":586,"box":{"x":116,"y":351,"width":743,"height":12}},{"id":"38eb42e5-1abd-4465-98b4-46daa3995705","block_type":"box","text":"with clients and funds.","page_number":586,"box":{"x":116,"y":366,"width":170,"height":10}},{"id":"acef569b-eddd-49fe-be90-025a5e391e28","block_type":"box","text":"In general, we tend to support the recommendations of the board of directors and management. As","page_number":586,"box":{"x":117,"y":397,"width":740,"height":12}},{"id":"b18f814f-2397-49a7-b361-4edf864cf3fa","block_type":"box","text":"indicated below, we may vote against management recommendations when we have concerns about","page_number":586,"box":{"x":117,"y":413,"width":755,"height":12}},{"id":"e8c70eec-cedd-4cd2-a6fa-ecffca3eb87a","block_type":"box","text":"how companies are serving the financial interests of our clients as their shareholders. BAIS takes a","page_number":586,"box":{"x":117,"y":428,"width":740,"height":12}},{"id":"acccda5d-a1d2-4fc5-be7e-2bb46bedaa01","block_type":"box","text":"globally consistent approach to voting but considers the different corporate governance regulations and","page_number":586,"box":{"x":116,"y":444,"width":772,"height":12}},{"id":"cb61a4f7-b6f3-4eaf-b8d2-3feb7922fe1d","block_type":"box","text":"norms across markets. Votes are determined on a case-by-case basis, in the context of a company’s","page_number":586,"box":{"x":117,"y":459,"width":753,"height":12}},{"id":"366bb957-993d-444f-9596-2d51ec47a096","block_type":"box","text":"situation and the investment mandate we have from clients. Please see page 19 for more information","page_number":586,"box":{"x":116,"y":475,"width":756,"height":12}},{"id":"3b668486-f19d-4cc5-9cb6-b334fc4bf4fc","block_type":"box","text":"about how we fulfill and oversee our investment stewardship responsibilities for BlackRock’s non-index","page_number":586,"box":{"x":116,"y":490,"width":768,"height":12}},{"id":"6df9e05d-c599-4b0c-bbe0-d3c348766fb3","block_type":"box","text":"equity strategies.","page_number":586,"box":{"x":116,"y":506,"width":125,"height":12}},{"id":"778cfa3e-5a36-49ad-9413-c7eff7707db9","block_type":"box","text":"5","page_number":586,"box":{"x":243,"y":506,"width":6,"height":6}},{"id":"dd59e535-a56f-44c9-b00b-41644c653f8d","block_type":"box","text":"Our approach to stewardship within fixed income","page_number":586,"box":{"x":303,"y":537,"width":399,"height":12}},{"id":"c4216b93-1531-450a-a300-852d89f10fd6","block_type":"box","text":"Although fixed income investors do not have the right to vote at shareholder meetings, issuer","page_number":586,"box":{"x":116,"y":568,"width":695,"height":12}},{"id":"367ac1bc-e6f5-4970-a6d2-e10a0188eac0","block_type":"box","text":"engagement is a component of fixed income investment strategies at BlackRock, particularly for those","page_number":586,"box":{"x":116,"y":583,"width":762,"height":12}},{"id":"cf5508e8-a492-40b1-98d5-8418a4a96118","block_type":"box","text":"with sustainability objectives in addition to financial objectives. Most corporate governance-related","page_number":586,"box":{"x":116,"y":599,"width":732,"height":12}},{"id":"8a6894ce-284d-4f8e-a456-9098cbf1912a","block_type":"box","text":"fixed income engagements are undertaken in conjunction with the active investment stewardship team,","page_number":586,"box":{"x":116,"y":614,"width":770,"height":12}},{"id":"4905f82f-1a56-4d17-b0ac-74359ece5dbb","block_type":"box","text":"and often active equity investors. In addition to the topics listed below, engagement with fixed income","page_number":586,"box":{"x":116,"y":630,"width":757,"height":12}},{"id":"be5f667a-61ff-4d1f-8f44-704fff884607","block_type":"box","text":"investment teams may help inform an issuer’s approach to structuring specialist issuances and the","page_number":586,"box":{"x":117,"y":645,"width":736,"height":12}},{"id":"f2818e55-95f5-42f9-9559-df476e0888e7","block_type":"box","text":"standard terms and information in bond documentation.","page_number":586,"box":{"x":116,"y":661,"width":411,"height":9}},{"id":"5ebb0fe0-00be-4bc4-8c2f-d03b482dbe23","block_type":"box","text":"4","page_number":586,"box":{"x":143,"y":828,"width":4,"height":5}},{"id":"b7b70613-54c3-4930-bdea-6316b05c8de0","block_type":"box","text":"References to the board, board directors or non-executive directors should be understood to include supervisory boards","page_number":586,"box":{"x":171,"y":828,"width":710,"height":10}},{"id":"a9f1a16b-e89d-4c04-97ea-6f0cf87c7f01","block_type":"box","text":"and their members, where relevant.","page_number":586,"box":{"x":170,"y":841,"width":210,"height":9}},{"id":"699b5534-d0e3-4c45-ad6b-eb10a35a9aa7","block_type":"box","text":"5","page_number":586,"box":{"x":143,"y":854,"width":4,"height":5}},{"id":"26ed47c7-d757-4f43-8bd8-b2ea58327f24","block_type":"box","text":"Non-index equity strategies include active equity holdings in BlackRock’s fundamental equity, systematic equity and","page_number":586,"box":{"x":171,"y":854,"width":685,"height":9}},{"id":"1e59f4a8-ca68-4054-b5c2-4376921cc1c0","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":586,"box":{"x":170,"y":867,"width":678,"height":9}},{"id":"7901058f-15e6-4cd8-b3f6-8651913010c4","block_type":"box","text":"extent those strategies hold voting securities or conduct issuer engagements.","page_number":586,"box":{"x":170,"y":880,"width":458,"height":9}},{"id":"e31fe3ee-a1fd-4752-a4a3-9f0a04e1108c","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":586,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"7c810d6b-3f00-4048-b225-c1fb34d8142c","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":586,"box":{"x":543,"y":909,"width":325,"height":12}},{"id":"2cef534c-bf57-4f18-ae95-4209a14c9372","block_type":"box","text":"5","page_number":586,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"1cd41356-c8bf-4adb-9c1d-09f148d97f1a","block_type":"box","text":"NM1026U-6004382-586/605","page_number":586,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"0c9bf362-2302-466e-8878-e12076008d42","block_type":"box","text":"Boards of Directors","page_number":587,"box":{"x":422,"y":87,"width":161,"height":10}},{"id":"37138d21-421b-4866-947a-33581bdabce2","block_type":"box","text":"Roles and responsibilities","page_number":587,"box":{"x":117,"y":118,"width":212,"height":12}},{"id":"73a8c6d8-4436-4117-adb3-67f2eb7c1867","block_type":"box","text":"There is widespread consensus that the foundation of good corporate governance is an effective board","page_number":587,"box":{"x":116,"y":149,"width":770,"height":12}},{"id":"7a62a6b2-2604-4627-98b4-d8d8492694c6","block_type":"box","text":"of directors that is able to advise and supervise management in an independent and objective","page_number":587,"box":{"x":116,"y":165,"width":700,"height":12}},{"id":"2cdfe510-9e2e-481a-8b82-d8f58f7131c0","block_type":"box","text":"manner.","page_number":587,"box":{"x":117,"y":183,"width":59,"height":7}},{"id":"2a62f141-c65f-4a10-aa03-76e0323c649c","block_type":"box","text":"6","page_number":587,"box":{"x":178,"y":180,"width":5,"height":6}},{"id":"febcce39-5b7d-49f1-b90e-20103c223cb7","block_type":"box","text":"We look to the board of directors (hereafter the “board”) to have an oversight role in the establishment","page_number":587,"box":{"x":116,"y":211,"width":762,"height":12}},{"id":"5f48b9e4-d010-45ef-a69a-77acb00e87a4","block_type":"box","text":"and realization of a company’s strategy, purpose and culture. These constructs are interdependent","page_number":587,"box":{"x":116,"y":227,"width":738,"height":12}},{"id":"2aa101bd-d0c3-4c6b-b8d6-212cba20ef51","block_type":"box","text":"and, when aligned, can better position a company to be resilient in the face of a changing business","page_number":587,"box":{"x":116,"y":242,"width":739,"height":12}},{"id":"1f8500e7-f6f6-442f-bc08-6c78c30decb7","block_type":"box","text":"environment, help reduce the risks of corporate or employee misconduct, and attract and retain the","page_number":587,"box":{"x":116,"y":258,"width":740,"height":12}},{"id":"006c4003-234a-404c-b76e-769f3fe75ffd","block_type":"box","text":"caliber of workers necessary to deliver financial performance over time.","page_number":587,"box":{"x":116,"y":273,"width":535,"height":12}},{"id":"0167aa02-e950-48cc-828d-c251d5a031bc","block_type":"box","text":"In overseeing the management of the company, the board ensures the necessary resources, policies","page_number":587,"box":{"x":117,"y":304,"width":754,"height":12}},{"id":"7ed8527b-8059-4887-8503-5d968d746256","block_type":"box","text":"and procedures are in place to help management meet its strategic objectives within an agreed risk","page_number":587,"box":{"x":116,"y":320,"width":742,"height":12}},{"id":"1b974aaa-b20c-47f5-9ffc-32016c41fc15","block_type":"box","text":"tolerance.","page_number":587,"box":{"x":116,"y":335,"width":78,"height":10}},{"id":"091508b1-1fe7-4175-826d-cb6292bd6f20","block_type":"box","text":"One of the most important responsibilities of the board is to appoint, and remove as necessary, the","page_number":587,"box":{"x":116,"y":366,"width":739,"height":12}},{"id":"43bec395-585e-4486-830a-de615de03d97","block_type":"box","text":"chief executive officer (“CEO”). In addition, the board plays a meaningful role in monitoring the","page_number":587,"box":{"x":116,"y":382,"width":704,"height":12}},{"id":"dee82c2c-98c7-45f1-96aa-2fac0deb674b","block_type":"box","text":"performance of the CEO and other key executives, determining executive compensation, ensuring a","page_number":587,"box":{"x":117,"y":397,"width":747,"height":12}},{"id":"6990f29c-138c-4bd3-9ebd-a9aa54178f38","block_type":"box","text":"rigorous audit, overseeing strategy execution and risk management and engaging with shareholders,","page_number":587,"box":{"x":117,"y":413,"width":753,"height":12}},{"id":"cb317caf-4641-4993-ac71-dbfaa41bcf37","block_type":"box","text":"and other stakeholders, as necessary.","page_number":587,"box":{"x":116,"y":428,"width":289,"height":12}},{"id":"68d38f2a-b63a-45e7-b57f-4c6c4ef25ff0","block_type":"box","text":"Composition and effectiveness","page_number":587,"box":{"x":116,"y":467,"width":253,"height":12}},{"id":"34a1abf5-2350-40c9-82fc-e347ceb0094b","block_type":"box","text":"Appointment process","page_number":587,"box":{"x":116,"y":498,"width":177,"height":12}},{"id":"23588118-e30e-4519-90cc-aba0a11b11be","block_type":"box","text":"A formal and transparent process for identifying and appointing director candidates is critical to","page_number":587,"box":{"x":116,"y":529,"width":708,"height":12}},{"id":"d4cac1ad-f7b5-42b0-a287-821d1f63cf77","block_type":"box","text":"ensuring the board is composed of directors with the appropriate mix of skills and experience.","page_number":587,"box":{"x":116,"y":544,"width":700,"height":12}},{"id":"96374678-109d-4291-9807-d9507a79a5fb","block_type":"box","text":"Generally, the board or a sub-committee determines the general criteria given the company’s","page_number":587,"box":{"x":117,"y":560,"width":695,"height":12}},{"id":"a3292254-128c-4a7a-8388-82c23f16c27a","block_type":"box","text":"circumstances (e.g., sector, maturity, geographic footprint) and any additional criteria for a specific role","page_number":587,"box":{"x":116,"y":575,"width":767,"height":12}},{"id":"60fa068d-bd0d-4d80-bbc0-30dcd0fed76a","block_type":"box","text":"being filled (e.g., financial expertise, industry track record). To inform the process, we encourage","page_number":587,"box":{"x":117,"y":591,"width":721,"height":12}},{"id":"123efca7-aed1-4683-b0e4-ee3fbfae7f17","block_type":"box","text":"companies to review the skills and experience of incumbent directors to identify any gaps and whether","page_number":587,"box":{"x":116,"y":606,"width":764,"height":12}},{"id":"80b2150b-0e8e-455e-a55c-f551db8ccf3f","block_type":"box","text":"the skills and experience of a director candidate would be additive. We welcome disclosures that","page_number":587,"box":{"x":116,"y":622,"width":722,"height":12}},{"id":"f2a0f1a0-823d-47f0-8614-4d2d5cc8c46d","block_type":"box","text":"explain how the board considered different skills and experience to ensure that the directors","page_number":587,"box":{"x":116,"y":637,"width":687,"height":12}},{"id":"173328af-fdfe-45b3-81ab-481354b06655","block_type":"box","text":"collectively can be effective in fulfilling their responsibilities. We assess a company’s board","page_number":587,"box":{"x":116,"y":653,"width":678,"height":12}},{"id":"d18e9fa7-78fc-484a-8af1-99f1537b5e72","block_type":"box","text":"composition against that of its peer group and local market requirements.","page_number":587,"box":{"x":116,"y":668,"width":542,"height":12}},{"id":"d66cfb92-855c-4d07-924b-d03ac6bf68fe","block_type":"box","text":"Shareholders periodically vote to elect directors to serve on the board. We do not prescribe any","page_number":587,"box":{"x":116,"y":699,"width":709,"height":13}},{"id":"0997fd26-1623-4f23-850e-61d1d9deb5c4","block_type":"box","text":"particular board composition in our engagements or voting but seek to understand how well placed a","page_number":587,"box":{"x":117,"y":715,"width":746,"height":12}},{"id":"665ab694-3f47-434d-bea6-6561564fb43e","block_type":"box","text":"board is to act in investors’ interests. We may vote against the election of the most senior independent","page_number":587,"box":{"x":117,"y":730,"width":760,"height":13}},{"id":"6e3ece8e-e995-4ad9-adbc-fdc4e6e68424","block_type":"box","text":"director, or the chair of the relevant committee, where a company has not demonstrated it has an","page_number":587,"box":{"x":116,"y":746,"width":720,"height":12}},{"id":"c3c19dff-d814-484e-8c0b-6e7aa64f1a43","block_type":"box","text":"appointment process that results in a high functioning board with the appropriate complement of skills","page_number":587,"box":{"x":116,"y":761,"width":753,"height":13}},{"id":"cfe2018a-35af-4cba-b813-8571bef60629","block_type":"box","text":"and experience amongst the directors to support strong financial performance over time. We may vote","page_number":587,"box":{"x":116,"y":777,"width":759,"height":12}},{"id":"25f4bb45-208e-42a3-b12d-5ca9461da9cf","block_type":"box","text":"against newly nominated directors who do not seem to have the appropriate skills or experience to","page_number":587,"box":{"x":116,"y":793,"width":731,"height":12}},{"id":"969cfe4d-5f61-4495-b6d9-0288c9f14877","block_type":"box","text":"contribute to the board’s effectiveness.","page_number":587,"box":{"x":116,"y":808,"width":286,"height":9}},{"id":"b0eb70f8-f7d3-4820-843b-a15d7fc62308","block_type":"box","text":"6","page_number":587,"box":{"x":143,"y":867,"width":4,"height":5}},{"id":"d0631ba9-3ad7-43cc-bcbf-685624af5387","block_type":"box","text":"See the Corporate Governance Codes of Germany, Japan, and the UK, as well as the corporate governance principles","page_number":587,"box":{"x":170,"y":867,"width":706,"height":9}},{"id":"4033c5e6-d65e-4cfe-8ada-c5cfc92ec05a","block_type":"box","text":"of the US Business Roundtable as examples.","page_number":587,"box":{"x":170,"y":880,"width":268,"height":9}},{"id":"a079b1f9-a0da-448a-b0e0-975083bd8582","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":587,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"cd1011df-ab3b-47af-8865-afd671f57dd4","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":587,"box":{"x":543,"y":909,"width":325,"height":12}},{"id":"22fbc8ec-05b9-4093-b347-aef17ee17d24","block_type":"box","text":"6","page_number":587,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"f952fcce-28b8-4bcd-9f57-05a81d8f1140","block_type":"box","text":"NM1026U-6004382-587/605","page_number":587,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"30abd652-b261-48a8-bb8d-7d695a510b6c","block_type":"box","text":"Independence","page_number":588,"box":{"x":116,"y":87,"width":118,"height":12}},{"id":"9595058b-cc7f-493b-b2a6-e8f273dd1349","block_type":"box","text":"Director independence from management, significant shareholders or other stakeholders (e.g.,","page_number":588,"box":{"x":117,"y":118,"width":706,"height":12}},{"id":"45c97860-e3af-4f25-b7b8-b1dd297d7234","block_type":"box","text":"government or employees) is of paramount importance to the protection of the interests of minority","page_number":588,"box":{"x":116,"y":134,"width":736,"height":12}},{"id":"b0f5fae4-b7de-4867-bae5-e8353deec88b","block_type":"box","text":"shareholders such as BlackRock’s clients. We consider it good practice for at least half the directors to","page_number":588,"box":{"x":116,"y":149,"width":766,"height":12}},{"id":"e9e4040e-24cb-4e9f-ab3b-3a752d58250a","block_type":"box","text":"be independent and free from conflicts of interest or undue influence.","page_number":588,"box":{"x":117,"y":165,"width":510,"height":11}},{"id":"661426df-ef43-4df4-b0d3-4d865682a731","block_type":"box","text":"7","page_number":588,"box":{"x":629,"y":165,"width":5,"height":6}},{"id":"fd72277f-5372-4c8d-99a2-5059c0d51f9d","block_type":"box","text":"This also helps to ensure that","page_number":588,"box":{"x":635,"y":165,"width":229,"height":11}},{"id":"696beb3f-7725-40c9-84a3-f14d51a03f4c","block_type":"box","text":"board committees are composed of a sufficient number of independent directors. Companies domiciled","page_number":588,"box":{"x":117,"y":180,"width":770,"height":12}},{"id":"b8fa8779-5e4a-4e51-ae69-fd641a6a1070","block_type":"box","text":"in markets with a higher threshold for board independence should meet those local requirements.","page_number":588,"box":{"x":117,"y":196,"width":727,"height":12}},{"id":"67440203-a9fd-49c9-b038-1f6dada0c2c7","block_type":"box","text":"We may vote against the election of non-independent directors if the board does not have a sufficient","page_number":588,"box":{"x":116,"y":227,"width":756,"height":12}},{"id":"e7dcdf9c-469e-49bb-83f0-6d5913027019","block_type":"box","text":"balance of independence. We may also vote against the election of the chair of the committee","page_number":588,"box":{"x":117,"y":242,"width":701,"height":12}},{"id":"00799aa3-64f4-4f65-9ec0-e44c7ecba950","block_type":"box","text":"responsible for board composition if this is a perennial issue.","page_number":588,"box":{"x":117,"y":258,"width":453,"height":11}},{"id":"db5ab2db-e308-407e-b029-6ec4eebc269e","block_type":"box","text":"Independent board leadership","page_number":588,"box":{"x":116,"y":289,"width":245,"height":11}},{"id":"0a78ab07-38ce-43e3-81f9-e5c7a3a882c9","block_type":"box","text":"Practices across markets differ, as do board structures, but we observe two main approaches to","page_number":588,"box":{"x":117,"y":320,"width":718,"height":12}},{"id":"fe6df3e5-ef57-47ac-80d2-0d6a2693e174","block_type":"box","text":"independent board leadership. One is a non-executive, independent chair of the board who is","page_number":588,"box":{"x":117,"y":335,"width":697,"height":12}},{"id":"81dd5c9c-4648-4efd-b349-3faa21ad77d2","block_type":"box","text":"responsible for leading the board in the effective exercise of its duties. The other is a lead or senior","page_number":588,"box":{"x":117,"y":351,"width":738,"height":12}},{"id":"b7dd4618-bda7-448e-9f7e-a4c80e802e63","block_type":"box","text":"independent director, who is responsible for coordinating with the other non-executive directors and","page_number":588,"box":{"x":117,"y":366,"width":742,"height":12}},{"id":"43bd1cda-1a5e-42b2-8ce7-e787e15570ce","block_type":"box","text":"working closely with the executive chair on the board agenda and other board procedures. In this case,","page_number":588,"box":{"x":116,"y":382,"width":770,"height":12}},{"id":"016b84ad-7415-486b-bac2-5aae3a4c0307","block_type":"box","text":"the executive chair and the lead independent director work together to ensure the board is effectively","page_number":588,"box":{"x":116,"y":397,"width":754,"height":12}},{"id":"f84b410a-2fc6-4089-ac28-881f4d5c9bbf","block_type":"box","text":"fulfilling its responsibilities. In our view, the independent leader of the board, and/or the chair of a","page_number":588,"box":{"x":116,"y":413,"width":723,"height":12}},{"id":"87d4e92d-fb88-459c-a781-dc2ae74a2ddb","block_type":"box","text":"relevant committee, should be available to investors to discuss governance matters such as CEO","page_number":588,"box":{"x":117,"y":428,"width":727,"height":12}},{"id":"20cbd629-ad82-42d8-a2ea-6d602cb6cebc","block_type":"box","text":"succession, executive pay, and board performance. We look to boards to explain their board","page_number":588,"box":{"x":116,"y":444,"width":691,"height":12}},{"id":"71b9c706-6ab3-4bcc-93ce-e83ae84ed433","block_type":"box","text":"leadership model and how it serves the interests of shareholders.","page_number":588,"box":{"x":117,"y":459,"width":489,"height":12}},{"id":"b611cfd0-2a20-4d50-82e9-3348a8b2e74f","block_type":"box","text":"We may vote against the election of the chair of the committee responsible for board composition if","page_number":588,"box":{"x":116,"y":490,"width":740,"height":12}},{"id":"a63b2da0-e422-469f-9806-4c7c9d2372ef","block_type":"box","text":"there is not an identified independent leader of the board with clear responsibilities for board","page_number":588,"box":{"x":116,"y":506,"width":689,"height":12}},{"id":"9e56c16c-64b5-4350-97ad-76a4d3d4d915","block_type":"box","text":"performance. We may vote against the most senior independent director if the board has a policy of","page_number":588,"box":{"x":117,"y":521,"width":744,"height":12}},{"id":"8cc9d4fd-e3b0-47bc-bc6a-32b8f3b56f1b","block_type":"box","text":"not engaging with shareholders.","page_number":588,"box":{"x":117,"y":537,"width":242,"height":12}},{"id":"12711502-78aa-4e87-a52e-56f8a26e6c02","block_type":"box","text":"Tenure and succession","page_number":588,"box":{"x":118,"y":568,"width":189,"height":9}},{"id":"7694363a-89f8-40b0-b51f-3d25051d6adb","block_type":"box","text":"In our view, it is good practice for boards to establish the length of time a director would normally be","page_number":588,"box":{"x":117,"y":599,"width":745,"height":12}},{"id":"5472bc34-2fb2-4c5e-8606-d65442fddc54","block_type":"box","text":"expected to serve, in line with market norms where those exist. We find it helpful when companies","page_number":588,"box":{"x":116,"y":614,"width":733,"height":12}},{"id":"417e432b-6ea7-4ca8-89f2-453b6869d6e9","block_type":"box","text":"disclose their approach to director tenure particularly around the contributions of directors who have","page_number":588,"box":{"x":116,"y":630,"width":745,"height":12}},{"id":"11a474b4-95cb-42d1-bb24-cce9af1e183e","block_type":"box","text":"served for longer periods than typically provided for under local practice. In our experience, long","page_number":588,"box":{"x":116,"y":645,"width":718,"height":12}},{"id":"f8c338b6-c7cf-4f83-ad9b-27330e365e0f","block_type":"box","text":"serving directors could become less independent given their long-term relationship with management","page_number":588,"box":{"x":116,"y":661,"width":751,"height":12}},{"id":"9aef82fc-aa60-43f1-8cc8-31ef2beb7be8","block_type":"box","text":"and involvement in past board decisions.","page_number":588,"box":{"x":116,"y":676,"width":302,"height":12}},{"id":"18d09925-2206-42d8-be84-2c71f01fe13f","block_type":"box","text":"Succession planning for board roles helps achieve the appropriate cadence of turnover that balances","page_number":588,"box":{"x":116,"y":707,"width":750,"height":12}},{"id":"af8c4019-c557-4428-a3e8-786830935323","block_type":"box","text":"renewal through the regular introduction of directors with fresh perspectives and expertise with","page_number":588,"box":{"x":117,"y":723,"width":699,"height":12}},{"id":"de6588eb-b750-43ca-be4e-66d88f054c08","block_type":"box","text":"continuity through the retention of directors with long-term knowledge of the board and company.","page_number":588,"box":{"x":116,"y":738,"width":718,"height":12}},{"id":"a3007727-373b-4f99-b6c4-76f80d1e6953","block_type":"box","text":"In markets where there is not specific director tenure guidance from regulation or corporate","page_number":588,"box":{"x":117,"y":769,"width":675,"height":12}},{"id":"ac6950fa-95d1-45e7-b1b4-d4dab656467d","block_type":"box","text":"governance best practices, we may vote against the election of the chair of the committee responsible","page_number":588,"box":{"x":116,"y":785,"width":757,"height":12}},{"id":"99d70ec0-9983-4876-a0b2-ca7a96035a83","block_type":"box","text":"for board composition if a company does not clearly disclose its approach to director tenure and board","page_number":588,"box":{"x":116,"y":800,"width":757,"height":12}},{"id":"1721efa3-de8e-4329-b645-b4e65d1191a7","block_type":"box","text":"7","page_number":588,"box":{"x":143,"y":828,"width":4,"height":5}},{"id":"9a86424b-ab42-44e0-9e99-aa31f90664bc","block_type":"box","text":"Common impediments to independence may include but are not limited to: current or recent employment at the","page_number":588,"box":{"x":170,"y":828,"width":659,"height":10}},{"id":"635e70ea-002c-4949-8cae-8602e36fa76d","block_type":"box","text":"company or a subsidiary; being, or representing, a shareholder with a substantial shareholding in the company;","page_number":588,"box":{"x":170,"y":841,"width":659,"height":9}},{"id":"3ba3b8da-110c-448c-9584-ff0c52eeccf4","block_type":"box","text":"interlocking directorships; lengthy tenure, and having any other interest, business, or other relationship which could, or","page_number":588,"box":{"x":170,"y":854,"width":702,"height":9}},{"id":"2f625480-d7cd-4785-88cc-2adc890934bb","block_type":"box","text":"could reasonably be perceived to, materially interfere with a director’s ability to act in the best interests of the company","page_number":588,"box":{"x":170,"y":867,"width":703,"height":9}},{"id":"bdddbcce-7e7f-4b02-b690-648e16b905ba","block_type":"box","text":"and shareholders.","page_number":588,"box":{"x":170,"y":880,"width":106,"height":7}},{"id":"d657f517-7469-4afc-b8b5-dd21a0c21955","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":588,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"7918e012-5898-43b7-8d59-ded8cd611c13","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":588,"box":{"x":543,"y":909,"width":325,"height":12}},{"id":"b8d473e9-3761-4178-af81-cdfafe3527fb","block_type":"box","text":"7","page_number":588,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"b06a1241-3bb7-49e1-bd8d-199e0f3d048d","block_type":"box","text":"NM1026U-6004382-588/605","page_number":588,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"52ad99b3-ca4a-4215-9645-72ab2064d15f","block_type":"box","text":"renewal. We may vote against the election of directors who have served for more years than is typical","page_number":589,"box":{"x":117,"y":87,"width":760,"height":12}},{"id":"3c742dc7-f115-40b5-95b2-1b304e95872e","block_type":"box","text":"in markets with specific guidance, where the case for their continued service is not evident.","page_number":589,"box":{"x":117,"y":102,"width":679,"height":13}},{"id":"e70d0220-c313-4095-acf8-cf7f7239b3a1","block_type":"box","text":"Capacity","page_number":589,"box":{"x":117,"y":134,"width":74,"height":12}},{"id":"c1267800-b01e-4d37-89a8-3cf31aedc781","block_type":"box","text":"To be effective and engaged, directors need to have the time and energy to commit to the role. In our","page_number":589,"box":{"x":116,"y":165,"width":757,"height":12}},{"id":"d3e8d8ae-d921-41ca-8c93-f4d913626a23","block_type":"box","text":"view, an effective board will assess the ability of its members to maintain an appropriate focus on","page_number":589,"box":{"x":116,"y":180,"width":726,"height":12}},{"id":"2249291f-b30b-477d-86aa-450c5ef78e78","block_type":"box","text":"board matters and the company taking into consideration competing responsibilities. We recognize that","page_number":589,"box":{"x":117,"y":196,"width":770,"height":12}},{"id":"c205f221-ca36-4e60-b899-c386dcfc42a5","block_type":"box","text":"board leadership roles vary across markets in responsibilities and required time commitment but note","page_number":589,"box":{"x":117,"y":211,"width":756,"height":12}},{"id":"652d6769-b63d-4753-928b-b85f8c3a7142","block_type":"box","text":"that they are generally more intensive than a standard directorship. We will take local norms and","page_number":589,"box":{"x":116,"y":227,"width":721,"height":12}},{"id":"e15498ab-219c-4ba6-82d2-72e180c8b08e","block_type":"box","text":"practices into consideration when making our voting determinations across markets.","page_number":589,"box":{"x":117,"y":242,"width":628,"height":12}},{"id":"3ebde081-0448-4578-ae7d-9a19bce6fbdc","block_type":"box","text":"We may vote against the election of directors who do not seem to have sufficient capacity to effectively","page_number":589,"box":{"x":116,"y":273,"width":769,"height":12}},{"id":"eb105129-b00a-4506-9332-1dc795606cc9","block_type":"box","text":"fulfil their duties to the board and company.","page_number":589,"box":{"x":116,"y":289,"width":326,"height":12}},{"id":"deb00a4c-89c4-4c1c-b9db-c2af27dbe229","block_type":"box","text":"Director elections","page_number":589,"box":{"x":116,"y":320,"width":147,"height":9}},{"id":"67ce6fc6-7ece-4178-b63a-ff7bd8fc3801","block_type":"box","text":"Regular election of directors, ideally annually, supports director accountability to shareholders. A","page_number":589,"box":{"x":117,"y":351,"width":720,"height":12}},{"id":"ec1c622c-9598-4616-885c-c2871535aec0","block_type":"box","text":"classified board structure","page_number":589,"box":{"x":116,"y":366,"width":186,"height":10}},{"id":"b303c6e8-0e86-42cd-8aca-cde48cb2afdc","block_type":"box","text":"8","page_number":589,"box":{"x":303,"y":366,"width":5,"height":6}},{"id":"305cc838-af72-476a-ace3-7fd55bd586ea","block_type":"box","text":"may be justified by a company when it needs consistency and stability","page_number":589,"box":{"x":309,"y":366,"width":530,"height":12}},{"id":"9d680918-a28a-476a-902a-1ed884e45683","block_type":"box","text":"during a time of transition, or on the basis of its business model (e.g., a non-operating company such","page_number":589,"box":{"x":116,"y":382,"width":754,"height":12}},{"id":"f89bcf2b-fb64-46eb-b409-52abd5f25330","block_type":"box","text":"as closed-end funds).","page_number":589,"box":{"x":116,"y":397,"width":165,"height":12}},{"id":"b83e8b6c-9930-4ca6-a6d6-694b22c90f99","block_type":"box","text":"Shareholders should have the opportunity to evaluate nominated directors individually rather than in","page_number":589,"box":{"x":116,"y":428,"width":746,"height":12}},{"id":"5ca8e679-ae8d-45cc-b1c8-daa156afcdb9","block_type":"box","text":"bundled slates. We look to companies to provide sufficient information on each director standing for","page_number":589,"box":{"x":117,"y":444,"width":743,"height":12}},{"id":"6b9f26ee-9ed6-4a5d-b2e4-d7b8f8df31d4","block_type":"box","text":"election so that shareholders can assess their capabilities and suitability. We will generally not support","page_number":589,"box":{"x":116,"y":459,"width":765,"height":12}},{"id":"59a7fb52-b1d7-437a-ba9f-b62b2ee2e508","block_type":"box","text":"the election of directors whose names and biographical details have not been disclosed sufficiently in","page_number":589,"box":{"x":116,"y":475,"width":755,"height":12}},{"id":"73425a31-a9e4-42fa-9a60-668a7729710c","block_type":"box","text":"advance of the shareholder meeting.","page_number":589,"box":{"x":116,"y":490,"width":278,"height":12}},{"id":"650a816d-4131-4741-bc67-2bbca576d36a","block_type":"box","text":"Each director’s appointment should be dependent on receiving a simple majority of the votes cast at","page_number":589,"box":{"x":117,"y":521,"width":746,"height":12}},{"id":"291877a5-c041-4ce7-85f7-5030385d0064","block_type":"box","text":"the shareholder meeting. Where a company’s practices differ, we look to the board to provide a","page_number":589,"box":{"x":116,"y":537,"width":712,"height":12}},{"id":"d8bcb6c6-15ac-48ad-abda-2b52b42db1c2","block_type":"box","text":"detailed explanation as to how its approach best serves investors’ interests.","page_number":589,"box":{"x":116,"y":552,"width":567,"height":12}},{"id":"8983054e-ea9d-4967-a40c-a669f9fa1581","block_type":"box","text":"We may vote for shareholder or management proposals seeking to establish annual election of","page_number":589,"box":{"x":116,"y":583,"width":710,"height":12}},{"id":"50ed5513-af05-4024-ae0a-34f3c063523a","block_type":"box","text":"directors and/or a simple majority vote standard for director elections. We may vote against all the","page_number":589,"box":{"x":116,"y":599,"width":732,"height":12}},{"id":"b58ebb40-470d-4e73-9e8c-1fc1d646ca73","block_type":"box","text":"directors standing for election as part of a single slate if we have concerns about the profile or","page_number":589,"box":{"x":116,"y":614,"width":701,"height":12}},{"id":"24ddb77b-6801-428e-a202-c7eab9bfd693","block_type":"box","text":"performance of an individual director.","page_number":589,"box":{"x":117,"y":630,"width":280,"height":12}},{"id":"cc71002d-57ab-42f9-a40b-6387d901c78f","block_type":"box","text":"Committees","page_number":589,"box":{"x":117,"y":661,"width":95,"height":9}},{"id":"7f6a7112-6599-4d28-8263-70526e583c0d","block_type":"box","text":"Many boards establish committees to focus on specific responsibilities of the board such as audit and","page_number":589,"box":{"x":117,"y":692,"width":751,"height":12}},{"id":"04265aa1-2048-43f9-897b-47320d563bb9","block_type":"box","text":"risk, governance and human capital, and executive compensation, amongst other matters. We do not","page_number":589,"box":{"x":117,"y":707,"width":751,"height":12}},{"id":"6069361b-0ab8-4474-b594-e4d1ee0e204c","block_type":"box","text":"prescribe to companies what committees they should establish, but we seek to understand the board’s","page_number":589,"box":{"x":117,"y":723,"width":760,"height":12}},{"id":"a7ade6ac-c85a-4258-8f1a-5a2789055c4b","block_type":"box","text":"rationale for the committee structure it determines is appropriate. We note that, in some markets,","page_number":589,"box":{"x":117,"y":738,"width":717,"height":12}},{"id":"81d6e56d-3b04-44a0-8c5a-9182e86862d9","block_type":"box","text":"regulation requires such committees. The responsibilities of each committee should be clear, and the","page_number":589,"box":{"x":117,"y":754,"width":748,"height":12}},{"id":"b77ddf7e-4436-453e-8ed7-1ccf6e45a632","block_type":"box","text":"board should ensure that all critical matters are assigned either to the full board or to one of the","page_number":589,"box":{"x":117,"y":769,"width":706,"height":12}},{"id":"7d86d5c3-6712-496a-ba7c-a11775330eb6","block_type":"box","text":"committees. It is helpful to investor understanding when the board discloses the structure,","page_number":589,"box":{"x":116,"y":785,"width":665,"height":12}},{"id":"25d06aa8-7e86-4b3d-a9e3-d009dcf11e54","block_type":"box","text":"8","page_number":589,"box":{"x":143,"y":867,"width":4,"height":5}},{"id":"a613f6ad-d987-4541-a931-7d1cc4096a07","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":589,"box":{"x":170,"y":867,"width":673,"height":9}},{"id":"02d10a7f-5101-4908-b869-d510550beba3","block_type":"box","text":"directors stands for election in any one year.","page_number":589,"box":{"x":170,"y":880,"width":262,"height":9}},{"id":"4003d0e0-ee73-4da0-8b0d-f10a38793077","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":589,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"70666eb9-8004-4fa0-ad5a-b37d065483e1","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":589,"box":{"x":543,"y":909,"width":325,"height":12}},{"id":"4e22b37f-f922-4cde-95a8-191e361a98bf","block_type":"box","text":"8","page_number":589,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"373d8348-be7e-4d5b-916c-5a7f787318d9","block_type":"box","text":"NM1026U-6004382-589/605","page_number":589,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6596dbd3-4788-42ee-a096-850080452edf","block_type":"box","text":"membership, proportion of independent directors, and responsibilities of each committee. The","page_number":590,"box":{"x":117,"y":87,"width":700,"height":12}},{"id":"c5667ea3-7d67-4ea3-8f8d-00223b06b449","block_type":"box","text":"responsibilities we typically see assigned to the three most common committees include:","page_number":590,"box":{"x":117,"y":103,"width":662,"height":12}},{"id":"069c53af-af53-4d6b-80cd-f19c4ff54e72","block_type":"box","text":"• Audit and risk – oversight responsibilities for the integrity of financial reporting, risk","page_number":590,"box":{"x":150,"y":134,"width":650,"height":12}},{"id":"9121b79c-9031-4ee5-8e8d-7337ee218127","block_type":"box","text":"management and compliance with legal and regulatory requirements; may also play an","page_number":590,"box":{"x":184,"y":149,"width":650,"height":12}},{"id":"4ea815ea-8aa3-4dd3-b824-87bf159f18ed","block_type":"box","text":"oversight role in relation to the internal audit function and whistleblowing mechanisms.","page_number":590,"box":{"x":184,"y":165,"width":643,"height":12}},{"id":"c4edb62b-05ed-4c1d-9784-9ac68ac9aeb3","block_type":"box","text":"• Nominating, governance and human capital – oversight responsibilities for corporate","page_number":590,"box":{"x":150,"y":188,"width":664,"height":12}},{"id":"c6485516-fdfc-44d9-8373-469cad4bb71e","block_type":"box","text":"governance principles and practices of the company, including the periodic review of board","page_number":590,"box":{"x":184,"y":203,"width":679,"height":12}},{"id":"0e77ca91-e848-484d-a8c8-f511828c56c6","block_type":"box","text":"performance; responsibility for succession planning for CEO and key board roles, as well as","page_number":590,"box":{"x":184,"y":219,"width":687,"height":12}},{"id":"18502bbb-a33f-44e0-bd5c-55fe9b8042d7","block_type":"box","text":"the director appointment process; may also have oversight responsibilities for human capital","page_number":590,"box":{"x":183,"y":234,"width":690,"height":12}},{"id":"4932b005-890e-49ab-b5cc-9ef372f92e23","block_type":"box","text":"management strategies, including corporate culture and purpose.","page_number":590,"box":{"x":184,"y":250,"width":489,"height":12}},{"id":"09b0e313-5c1f-44a1-96d2-fe1e6f18464c","block_type":"box","text":"• Executive compensation – determines the compensation policies and programs for the CEO","page_number":590,"box":{"x":150,"y":273,"width":723,"height":12}},{"id":"1b8fc4cd-96ba-45f4-8850-3fd619c494f5","block_type":"box","text":"and other executive officers, approves annual awards and payments under the policies; may","page_number":590,"box":{"x":184,"y":289,"width":690,"height":12}},{"id":"9b6fbd98-8ba8-4234-8586-2fcbb4e35c2e","block_type":"box","text":"also have oversight responsibilities for firm-wide compensation policies.","page_number":590,"box":{"x":184,"y":304,"width":536,"height":12}},{"id":"040898d1-7c78-4042-89c8-2d9c965eaa45","block_type":"box","text":"We may vote against the election of the chair of the committee or other directors serving as committee","page_number":590,"box":{"x":116,"y":335,"width":765,"height":12}},{"id":"72608ed2-f400-4946-95f0-4d4447bd2f03","block_type":"box","text":"members to convey concerns about how a committee has undertaken its responsibilities. We may vote","page_number":590,"box":{"x":117,"y":351,"width":767,"height":12}},{"id":"a61d229b-0ca8-4967-9c04-89e15de28fe5","block_type":"box","text":"against the election of the most senior non-executive director if there is not a clearly disclosed","page_number":590,"box":{"x":116,"y":366,"width":702,"height":12}},{"id":"10cfe766-6aae-4f75-82fc-3c67796c9fd3","block_type":"box","text":"approach to board committees.","page_number":590,"box":{"x":116,"y":382,"width":236,"height":12}},{"id":"816e4704-0bed-4aea-9b9d-a43f2e7a5105","block_type":"box","text":"Board and director evaluation","page_number":590,"box":{"x":116,"y":413,"width":243,"height":9}},{"id":"1caaf58b-8bba-498a-88cd-715660b1fd5d","block_type":"box","text":"We consider it best practice for companies to conduct an annual review of the performance of the","page_number":590,"box":{"x":116,"y":444,"width":729,"height":12}},{"id":"6cb0aa8b-217b-4782-9b25-8088bae5c00e","block_type":"box","text":"board, the committees, the chair and individual directors. Periodically, this review could be undertaken","page_number":590,"box":{"x":117,"y":459,"width":762,"height":12}},{"id":"81da6c40-f343-40d4-b925-bf2fa069876f","block_type":"box","text":"by an independent third party able to bring objective perspectives to the board on governance and","page_number":590,"box":{"x":117,"y":475,"width":732,"height":12}},{"id":"46a6fabb-085f-4093-8cea-1caa4632ba3b","block_type":"box","text":"performance. We encourage companies to disclose their approach to and the objectives of","page_number":590,"box":{"x":117,"y":490,"width":677,"height":12}},{"id":"5e1ccf31-28d9-4307-b46e-388f75bdee31","block_type":"box","text":"evaluations, including any changes made to the board’s approach as a result.","page_number":590,"box":{"x":116,"y":506,"width":581,"height":12}},{"id":"e1d8e1de-bc0d-4ac2-87a7-5efbc5c9dc1c","block_type":"box","text":"Access to independent advice","page_number":590,"box":{"x":116,"y":537,"width":246,"height":12}},{"id":"9fd14ba2-f05b-45b3-90ac-b245ea27a24f","block_type":"box","text":"To support the directors in effectively fulfilling their duties to the company and shareholders, they","page_number":590,"box":{"x":116,"y":568,"width":723,"height":12}},{"id":"e710c902-5e04-4614-ade5-6e49e5957980","block_type":"box","text":"should have access to independent advice. In certain circumstances, it may be helpful to boards to","page_number":590,"box":{"x":116,"y":583,"width":738,"height":12}},{"id":"7fc7565d-a404-4af8-9097-e835e6b525d9","block_type":"box","text":"retain independent third parties to advise on critical matters. These might include new industry","page_number":590,"box":{"x":117,"y":599,"width":703,"height":12}},{"id":"283fe5a1-80e8-46c5-810d-c34196157545","block_type":"box","text":"developments such as emergent and disruptive technology, operating events with material","page_number":590,"box":{"x":116,"y":614,"width":676,"height":12}},{"id":"4d841867-de91-429d-8e1d-b98dcfcccfe0","block_type":"box","text":"consequences for the company’s reputation and/or performance, or significant transactions. Board","page_number":590,"box":{"x":116,"y":630,"width":735,"height":12}},{"id":"87209123-d954-45f9-928a-4cbbbd5aba5e","block_type":"box","text":"committees may similarly retain third parties to advise them on specialist matters such as audit,","page_number":590,"box":{"x":116,"y":645,"width":713,"height":12}},{"id":"213f34b2-d6e8-4e71-979e-155e8c4ea5a9","block_type":"box","text":"compensation and succession planning.","page_number":590,"box":{"x":116,"y":661,"width":297,"height":12}},{"id":"094ef3e3-cefa-47fe-96ee-638b5563a400","block_type":"box","text":"Executive compensation","page_number":590,"box":{"x":402,"y":692,"width":195,"height":12}},{"id":"0a7cc446-b3ee-4bd6-a1ef-94af1ddcadb8","block_type":"box","text":"Boards play an important role in establishing compensation arrangements that enable the company to","page_number":590,"box":{"x":117,"y":723,"width":755,"height":12}},{"id":"5c229f23-780b-4405-b333-15ea9fc0ca1b","block_type":"box","text":"recruit, retain and reward the caliber of executive management necessary to lead and operate the","page_number":590,"box":{"x":117,"y":738,"width":724,"height":12}},{"id":"803c2f65-9232-475b-b8e5-bfe2d7931145","block_type":"box","text":"company to deliver superior financial returns over time. We focus on alignment between variable pay","page_number":590,"box":{"x":116,"y":754,"width":748,"height":12}},{"id":"fe339f63-2802-4dd4-9d61-41758d0f6711","block_type":"box","text":"and a company’s financial performance.","page_number":590,"box":{"x":116,"y":769,"width":296,"height":12}},{"id":"863fdf2e-5433-4b07-b974-ef1e1080819e","block_type":"box","text":"Generally, executive compensation arrangements have four components: base salary, annual bonus","page_number":590,"box":{"x":117,"y":800,"width":746,"height":12}},{"id":"e57a76ab-ce08-4b7b-9f4e-9eb86e8aebf6","block_type":"box","text":"that rewards performance against short-term metrics, incentives — most often share-based- that","page_number":590,"box":{"x":116,"y":816,"width":717,"height":12}},{"id":"6c1681ce-e0ad-46dc-b4f4-0d73a12acb93","block_type":"box","text":"reward performance against long-term metrics, and pensions and benefits. In our observation, base","page_number":590,"box":{"x":117,"y":831,"width":744,"height":12}},{"id":"60235f3c-f736-4c90-bf32-96d195879498","block_type":"box","text":"salary, pensions and benefits are largely set relative to market norms and benchmarks. The annual","page_number":590,"box":{"x":116,"y":847,"width":741,"height":12}},{"id":"ce51837a-efb5-4247-be54-b3dd54a01783","block_type":"box","text":"bonus and share-based incentive, or variable pay plans, tend to be tailored to the company, its sector","page_number":590,"box":{"x":117,"y":862,"width":757,"height":12}},{"id":"0f1e3dc0-4812-4fc9-b377-1c3ff56c3606","block_type":"box","text":"and long-term strategy, as well as the individuals the board is seeking to recruit and motivate.","page_number":590,"box":{"x":116,"y":878,"width":699,"height":12}},{"id":"aa712c90-e399-4f4b-91e8-70732cb58470","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":590,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"1d54d2b1-0cc7-4998-a3b2-a140c31a3fec","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":590,"box":{"x":543,"y":909,"width":325,"height":12}},{"id":"65c8a751-5b23-4501-88d7-afa8d86c800d","block_type":"box","text":"9","page_number":590,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"d0d06fb2-5c75-4e63-a6ca-280fbad179f8","block_type":"box","text":"NM1026U-6004382-590/605","page_number":590,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"8a143813-4048-4542-87c6-e5d4cbf8581d","block_type":"box","text":"Recognizing the unique circumstances of each company, we determine whether to support a","page_number":591,"box":{"x":117,"y":87,"width":693,"height":12}},{"id":"15f11417-ad9a-4d5b-92a4-483961ce4df2","block_type":"box","text":"company’s approach to executive compensation on a case-by-case basis. We rely on companies","page_number":591,"box":{"x":116,"y":103,"width":726,"height":12}},{"id":"ad34c3d7-4f75-4cbf-9e33-43cd0a2ae982","block_type":"box","text":"providing sufficient quantitative and qualitative information in their disclosures to enable shareholders","page_number":591,"box":{"x":117,"y":118,"width":754,"height":12}},{"id":"488939d9-43a6-4eb3-8174-3a3eb6744bc4","block_type":"box","text":"to understand the compensation arrangements and assess the alignment with investors’ interests.","page_number":591,"box":{"x":116,"y":134,"width":732,"height":12}},{"id":"7ec8a7c6-3b35-48f3-a0dd-ef2be53a4ea2","block_type":"box","text":"Features we look for in compensation arrangements include:","page_number":591,"box":{"x":117,"y":149,"width":454,"height":12}},{"id":"c3ddc84f-0ae7-4f4b-b666-4a07472a3c49","block_type":"box","text":"• Fixed pay components, including base salary, benefits and prerequisites that are appropriate","page_number":591,"box":{"x":150,"y":180,"width":727,"height":12}},{"id":"d5c68f78-36f6-483c-9a6c-4425dec0a14d","block_type":"box","text":"in the context of the company’s size, sector and market.","page_number":591,"box":{"x":184,"y":196,"width":419,"height":12}},{"id":"31d32f3f-1a7e-482e-8f57-bd943485d445","block_type":"box","text":"• Variable pay subject to performance metrics that are closely linked to the company’s short","page_number":591,"box":{"x":150,"y":219,"width":707,"height":12}},{"id":"dc9ad70a-c61c-48e9-8ad4-0224f15a95b7","block_type":"box","text":"and long-term strategic objectives.","page_number":591,"box":{"x":184,"y":234,"width":260,"height":12}},{"id":"03d4df3c-ed16-4f81-b621-30d433118df8","block_type":"box","text":"• Long-term incentives that motivate sustained performance across a multi-year period.","page_number":591,"box":{"x":150,"y":258,"width":674,"height":12}},{"id":"2405054e-b719-49f2-a446-68472c8b3740","block_type":"box","text":"• A balance between fixed and variable pay, short- and long-term incentives, and specific","page_number":591,"box":{"x":150,"y":281,"width":688,"height":12}},{"id":"c7ff2c89-420b-4ae3-af47-5969574a1873","block_type":"box","text":"instruments (cash and equity awards) that promotes pay program durability and seldom","page_number":591,"box":{"x":184,"y":296,"width":654,"height":12}},{"id":"4117e652-d44e-4de0-8b14-1691ee1ba23e","block_type":"box","text":"necessitates one-off, discretionary payments.","page_number":591,"box":{"x":184,"y":312,"width":342,"height":12}},{"id":"ac4c91e9-b67d-41e3-a13d-c53b75794368","block_type":"box","text":"• Pay outcomes that are consistent with the returns to investors over the relevant time period.","page_number":591,"box":{"x":150,"y":335,"width":720,"height":12}},{"id":"1d3591d0-e441-4f76-b927-7ed9c590f0fb","block_type":"box","text":"• Board discretion, if allowed within the variable pay arrangements, to be used sparingly,","page_number":591,"box":{"x":150,"y":358,"width":683,"height":12}},{"id":"3430695f-97b3-4e2b-af44-e21273f54cfc","block_type":"box","text":"responsibly and transparently.","page_number":591,"box":{"x":184,"y":374,"width":228,"height":12}},{"id":"34d6c78c-b867-4655-a1c6-e9be501825f0","block_type":"box","text":"• A requirement, that participants in long-term share-based incentive plans build a meaningful","page_number":591,"box":{"x":150,"y":397,"width":721,"height":12}},{"id":"086a49d7-3564-434a-85da-9ba3883465e2","block_type":"box","text":"shareholding in the company within a defined time period, as determined by the board or","page_number":591,"box":{"x":184,"y":413,"width":662,"height":12}},{"id":"b7c74cab-4f91-4f68-9e73-43686e53f6ad","block_type":"box","text":"relevant board committee.","page_number":591,"box":{"x":184,"y":428,"width":198,"height":10}},{"id":"b1a2c34c-4b52-42dd-bcff-1c70e3ca390f","block_type":"box","text":"• Change of control provisions that appropriately balance the interests of executives and","page_number":591,"box":{"x":150,"y":451,"width":681,"height":12}},{"id":"e9fea72a-d408-44ee-a69c-09785b5abad2","block_type":"box","text":"shareholders.","page_number":591,"box":{"x":184,"y":467,"width":106,"height":9}},{"id":"8a3b893e-0454-4930-9970-fbad48daf60d","block_type":"box","text":"• Clawback or malus provisions that allow the company to recoup or hold back variable","page_number":591,"box":{"x":150,"y":490,"width":672,"height":12}},{"id":"09b4c70a-2471-4356-bf4c-4cb1db91185a","block_type":"box","text":"compensation from individuals whose awards were based on fraudulent activities, misstated","page_number":591,"box":{"x":184,"y":506,"width":687,"height":12}},{"id":"bb29405e-07f7-45b2-8c5d-1ec4f8cdf9d4","block_type":"box","text":"financial reports, or executive misconduct.","page_number":591,"box":{"x":183,"y":521,"width":318,"height":12}},{"id":"a1a0a2bc-f7ed-437a-a228-7a6cafc95992","block_type":"box","text":"• Severance arrangements that protect the company’s interests but do not cost more than is","page_number":591,"box":{"x":150,"y":544,"width":710,"height":12}},{"id":"e492fd3c-61be-405e-b211-548d8f8ad970","block_type":"box","text":"contractual.","page_number":591,"box":{"x":184,"y":560,"width":91,"height":9}},{"id":"c3460bab-206e-4388-bcd4-2a4a31f8ddb2","block_type":"box","text":"We may vote against proposals to introduce new share-based incentives, approve existing policies or","page_number":591,"box":{"x":116,"y":591,"width":757,"height":12}},{"id":"7ce98149-c49c-44df-bf6e-7d24f842d488","block_type":"box","text":"plans, or approve the compensation report where we do not see alignment between executive","page_number":591,"box":{"x":117,"y":607,"width":701,"height":11}},{"id":"03c1ccfa-ddc0-447d-ad3d-728977023cd0","block_type":"box","text":"compensation arrangements and our clients’ financial interests. When there is not an alternative, or","page_number":591,"box":{"x":116,"y":622,"width":742,"height":12}},{"id":"63da8ce5-8fa8-476b-a5a2-3007c0abe3c4","block_type":"box","text":"where there have been multi-year issues with compensation misaligned with performance, we may","page_number":591,"box":{"x":116,"y":637,"width":738,"height":12}},{"id":"a8183fc6-acbf-4bc1-a8c7-23db0fc7a1b0","block_type":"box","text":"vote against the election of the chair of the responsible committee, or the most senior independent","page_number":591,"box":{"x":116,"y":653,"width":735,"height":12}},{"id":"b87531c0-6c22-4650-89b5-43183c648a95","block_type":"box","text":"director.","page_number":591,"box":{"x":116,"y":669,"width":59,"height":9}},{"id":"b7334cf2-1ee8-43ab-aa62-4edd08f6158c","block_type":"box","text":"Non-executive director compensation","page_number":591,"box":{"x":350,"y":700,"width":299,"height":11}},{"id":"51dc9409-b128-4cba-a81b-7e7c9a9cb241","block_type":"box","text":"Companies generally pay non-executive directors an annual retainer or fee in cash, shares or a","page_number":591,"box":{"x":117,"y":730,"width":706,"height":13}},{"id":"0a2d1cc5-00e4-4ea8-8fbc-60a414fbee64","block_type":"box","text":"combination of the two. Some companies also pay additional fees for service on board committees or","page_number":591,"box":{"x":116,"y":746,"width":752,"height":12}},{"id":"81097232-f7d3-4dd2-a239-7175c101dac6","block_type":"box","text":"in board leadership roles. We do not support non-executive directors participating in performance","page_number":591,"box":{"x":117,"y":761,"width":726,"height":13}},{"id":"22fe0c70-7cd9-494a-a569-40ea105038d7","block_type":"box","text":"based incentive plans as doing so may create a conflict of interest and undermine their independence","page_number":591,"box":{"x":117,"y":777,"width":753,"height":12}},{"id":"680e21d2-1c2e-49e9-b2e5-bc81c5e8adc6","block_type":"box","text":"from management, whom they oversee.","page_number":591,"box":{"x":116,"y":792,"width":295,"height":13}},{"id":"598b9776-9b43-4808-8f3f-deb04426c7ef","block_type":"box","text":"Capital structure","page_number":591,"box":{"x":433,"y":823,"width":133,"height":12}},{"id":"64ffb080-e470-43b7-ae49-3095ebda6eb2","block_type":"box","text":"Boards are responsible for ensuring senior executive leadership has established a capital strategy that","page_number":591,"box":{"x":117,"y":854,"width":765,"height":13}},{"id":"14b90b3b-b855-4dcf-b660-86abb906a627","block_type":"box","text":"achieves appropriate capital allocation in support of long-term financial resilience.","page_number":591,"box":{"x":116,"y":870,"width":610,"height":12}},{"id":"af529ed5-8dab-4af8-8bea-aea34cf861a4","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":591,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"92c3b283-c485-459b-9a19-61476d135256","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":591,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"e2607688-cc15-47b3-b217-79684e1c90cf","block_type":"box","text":"10","page_number":591,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"9d150055-d520-4c9c-83a3-19d46f48586b","block_type":"box","text":"NM1026U-6004382-591/605","page_number":591,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4322c65e-e6db-4c20-89bc-236ae04b0aea","block_type":"box","text":"Where company practices diverge from those set out below, we look for companies to disclose why","page_number":592,"box":{"x":116,"y":87,"width":743,"height":12}},{"id":"dad94dc8-f4b3-4bc6-8654-7feaabd2f33a","block_type":"box","text":"they view these practices to be aligned with shareholders’ interests. We may vote against management","page_number":592,"box":{"x":116,"y":103,"width":772,"height":12}},{"id":"b7146eb0-ec3e-4a60-93f3-204689214757","block_type":"box","text":"proposals seeking capital-related authorities, or the election of the most senior independent director, if","page_number":592,"box":{"x":117,"y":118,"width":761,"height":12}},{"id":"be54971d-b7f7-4fbc-a38d-b962d748c7a8","block_type":"box","text":"we have concerns about a company’s approach. We may also support a shareholder proposal seeking","page_number":592,"box":{"x":116,"y":134,"width":768,"height":12}},{"id":"e6e254a9-8c4a-47b5-bc22-ad5c9635c62d","block_type":"box","text":"conversion of shares with differentiated voting rights to a one-share, one-vote standard.","page_number":592,"box":{"x":116,"y":149,"width":655,"height":12}},{"id":"7b90088c-008f-4f76-864c-50cc19803eac","block_type":"box","text":"Share","page_number":592,"box":{"x":116,"y":180,"width":46,"height":10}},{"id":"2e598e15-b6be-431a-905c-d74f6027e270","block_type":"box","text":"issuance","page_number":592,"box":{"x":168,"y":180,"width":76,"height":10}},{"id":"447b6438-d2d1-4019-ab3c-2f9ef5b8b51d","block_type":"box","text":"We assess requests for share issuance for particular transactions on a case-by-case basis. We will","page_number":592,"box":{"x":116,"y":211,"width":741,"height":12}},{"id":"8952b4b9-9837-44cb-b724-680d4abf02b3","block_type":"box","text":"generally support authorities to issue shares when subject to pre-emptive rights, and up to 20% absent","page_number":592,"box":{"x":116,"y":227,"width":768,"height":12}},{"id":"e507c179-70f0-422c-9e71-0a1cca6cc5b0","block_type":"box","text":"pre-emptive rights. We consider it good practice for companies to seek regular approval of these","page_number":592,"box":{"x":117,"y":242,"width":720,"height":12}},{"id":"6f281ffe-6afb-4c67-9478-19bf2124d935","block_type":"box","text":"authorities to allow shareholders to take into consideration how prior authorities were used, as well as","page_number":592,"box":{"x":116,"y":258,"width":759,"height":11}},{"id":"a7704ed2-7e5b-4b89-b73c-59c73874d356","block_type":"box","text":"the current circumstances of the company and the market environment.","page_number":592,"box":{"x":116,"y":273,"width":536,"height":12}},{"id":"976a0c77-0559-41c4-ba18-78a7c1f40ec1","block_type":"box","text":"Share buybacks","page_number":592,"box":{"x":116,"y":304,"width":133,"height":12}},{"id":"387ef14c-d276-4988-abd4-237a9c42e1f1","block_type":"box","text":"We assess share buyback proposals in the context of the company’s disclosed capital management","page_number":592,"box":{"x":116,"y":335,"width":746,"height":12}},{"id":"d3fc62c9-4ef7-4fe8-a7c7-9173d7b8bd48","block_type":"box","text":"strategy and management’s determination of the appropriate balance between investment that","page_number":592,"box":{"x":116,"y":351,"width":706,"height":12}},{"id":"c7007472-8f6a-4031-a264-f2e263b41fc2","block_type":"box","text":"supports the long-term growth of the company and returning cash to investors. We also take into","page_number":592,"box":{"x":116,"y":366,"width":721,"height":12}},{"id":"74b26a80-7a9c-4373-8e8f-f3acae233354","block_type":"box","text":"consideration the effect of a buyback program on the company’s balance sheet and executive","page_number":592,"box":{"x":116,"y":382,"width":701,"height":12}},{"id":"4fa2a568-e835-419e-ac56-78a93195abe7","block_type":"box","text":"compensation arrangements and the price at which shares are repurchased relative to market price.","page_number":592,"box":{"x":116,"y":397,"width":748,"height":12}},{"id":"aa0f777c-5b63-405d-beff-6aa03ac988bd","block_type":"box","text":"We consider it good practice for companies to seek regular approval of these authorities to allow","page_number":592,"box":{"x":116,"y":413,"width":721,"height":12}},{"id":"7a3f9030-5d03-48f1-bf86-3998b04b650a","block_type":"box","text":"shareholders to take into consideration how prior authorities were used, as well as the current","page_number":592,"box":{"x":116,"y":428,"width":700,"height":12}},{"id":"6e85a062-c80f-49ba-a0d3-7732dda16cf4","block_type":"box","text":"circumstances of the company and the market environment.","page_number":592,"box":{"x":116,"y":444,"width":451,"height":12}},{"id":"c19e1076-0186-4824-8da9-bc00ce34fddb","block_type":"box","text":"Dividends","page_number":592,"box":{"x":117,"y":475,"width":84,"height":9}},{"id":"6575807a-d712-44f7-9c36-1acb4be7f2e4","block_type":"box","text":"We generally defer to management and the board on dividend policy but may engage to seek further","page_number":592,"box":{"x":116,"y":506,"width":752,"height":12}},{"id":"ccc008d5-9a58-4d9c-98f2-f519a9e7540b","block_type":"box","text":"clarification where a proposed dividend appears out of line with the company’s financial position.","page_number":592,"box":{"x":116,"y":521,"width":720,"height":12}},{"id":"a4086d77-1a38-43dc-bc9a-1c1fbfca0251","block_type":"box","text":"Differentiated voting rights","page_number":592,"box":{"x":117,"y":552,"width":219,"height":12}},{"id":"5b6a7070-d155-4473-8c22-d0247e0854cb","block_type":"box","text":"We prefer companies to adopt a one-share, one-vote structure for share classes with the same","page_number":592,"box":{"x":116,"y":583,"width":710,"height":12}},{"id":"c1275215-dea8-4051-8c28-6fb6e6542ba3","block_type":"box","text":"economic exposure. Certain companies, particularly those new to public markets, could make the case","page_number":592,"box":{"x":116,"y":599,"width":768,"height":12}},{"id":"33b992f5-ce5f-493a-877d-18a0ad5a095d","block_type":"box","text":"to adopt a differentiated voting rights structure, or dual class stock. In those situations, we encourage","page_number":592,"box":{"x":116,"y":614,"width":755,"height":12}},{"id":"c4458a68-ec9c-4073-8dff-2cfdb4bf618c","block_type":"box","text":"companies to evaluate and seek approval for their capital structure on a periodic basis.","page_number":592,"box":{"x":116,"y":630,"width":650,"height":12}},{"id":"af582996-dc72-47e7-a3bd-6d3f4f58ce1a","block_type":"box","text":"Transactions and special situations","page_number":592,"box":{"x":357,"y":661,"width":285,"height":12}},{"id":"92e6cc5c-f13f-45d7-9e3e-63ae63894e71","block_type":"box","text":"We monitor developments in transactions and special situations closely and undertake our own","page_number":592,"box":{"x":116,"y":692,"width":706,"height":12}},{"id":"2d0fcfcc-9599-4bc3-9f10-5751ffa9e66b","block_type":"box","text":"detailed analyses of proposals.","page_number":592,"box":{"x":116,"y":707,"width":229,"height":12}},{"id":"b152afa5-f798-4146-a1c6-1bbd2bb9e69c","block_type":"box","text":"Mergers and acquisitions","page_number":592,"box":{"x":117,"y":738,"width":201,"height":12}},{"id":"0d90eb3a-d55b-4095-a9c7-07c7cfc3092b","block_type":"box","text":"We evaluate proposed mergers or acquisitions by assessing the financial outcome for our clients as","page_number":592,"box":{"x":116,"y":769,"width":740,"height":12}},{"id":"ee5ba841-b170-4a1b-ba9f-05f9c62f1c59","block_type":"box","text":"minority shareholders. Management should provide an assessment of the proposed transaction’s","page_number":592,"box":{"x":117,"y":785,"width":719,"height":12}},{"id":"1945048d-f58b-4c72-b430-c622e9725917","block_type":"box","text":"strategic and financial rationale, along with its execution and operational risks. We review each","page_number":592,"box":{"x":116,"y":800,"width":703,"height":12}},{"id":"efab4d7a-05c2-4aed-ba14-d3302553dc15","block_type":"box","text":"transaction independently based on these factors and the degree to which the transaction enhances","page_number":592,"box":{"x":116,"y":816,"width":743,"height":12}},{"id":"311b9d0f-4898-44f2-acc0-bf73204cb19a","block_type":"box","text":"shareholder value. The board might consider establishing an ad hoc transaction committee to","page_number":592,"box":{"x":116,"y":831,"width":699,"height":12}},{"id":"5af98b78-27e1-4869-ab89-c5665a8d8d08","block_type":"box","text":"undertake an independent assessment of a significant merger or acquisition, in advance of making its","page_number":592,"box":{"x":117,"y":847,"width":757,"height":12}},{"id":"02e9c3e1-9253-4a95-a06d-eadc8cbf94d0","block_type":"box","text":"recommendation to shareholders.","page_number":592,"box":{"x":117,"y":862,"width":254,"height":10}},{"id":"58b53e7a-258e-4407-af36-869a0cac2a1e","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":592,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"89c907d4-dc74-4103-bb95-602ad5ed5b00","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":592,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"0070dc18-0fe9-4494-a313-44eae5bd6094","block_type":"box","text":"11","page_number":592,"box":{"x":866,"y":909,"width":15,"height":9}},{"id":"fe76f063-acee-47bf-bffc-58631637fed8","block_type":"box","text":"NM1026U-6004382-592/605","page_number":592,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"05e50183-5db4-4359-aa84-a453c9cf9546","block_type":"box","text":"We will vote against transactions that, in our assessment, do not advance our clients’ financial","page_number":593,"box":{"x":116,"y":87,"width":703,"height":12}},{"id":"052afd32-e1fb-4601-8815-c175e7919138","block_type":"box","text":"interests.","page_number":593,"box":{"x":117,"y":103,"width":72,"height":9}},{"id":"ebe86b1d-3fd2-41c7-abef-f536019e97b5","block_type":"box","text":"Anti-takeover defenses","page_number":593,"box":{"x":116,"y":134,"width":190,"height":9}},{"id":"159ecc5a-ed80-49a0-ad13-bb0e405b98d7","block_type":"box","text":"In principle, we do not support companies using anti-takeover defenses, also known as poison pills or","page_number":593,"box":{"x":117,"y":165,"width":757,"height":12}},{"id":"094258e8-e1fa-4cdb-a83a-a188c3b98526","block_type":"box","text":"shareholder rights plans, as they can entrench management and boards which have not delivered","page_number":593,"box":{"x":116,"y":180,"width":731,"height":12}},{"id":"ac339e31-4328-40ab-9a03-c0912bce538d","block_type":"box","text":"long-term shareholder value. By exception, a poison pill may be supported if its purpose is to delay a","page_number":593,"box":{"x":117,"y":196,"width":751,"height":12}},{"id":"72563c6c-9280-4b49-8fc3-5d2d83c1d261","block_type":"box","text":"takeover that is considered sub-optimal and enable management to seek an improved offer. Similarly,","page_number":593,"box":{"x":116,"y":211,"width":761,"height":12}},{"id":"29837de2-f2a4-411c-a3ec-a8272a846f82","block_type":"box","text":"management could make the case to use a poison pill to block a shareholder activism campaign that","page_number":593,"box":{"x":117,"y":227,"width":751,"height":12}},{"id":"e7a878df-4780-4ebf-89d2-e6c517ac0d4f","block_type":"box","text":"may be counter to the interests of other investors. Defense mechanisms introduced in these","page_number":593,"box":{"x":117,"y":242,"width":687,"height":12}},{"id":"f0d50d04-26b8-47bc-9c29-1f2094395f4c","block_type":"box","text":"circumstances should be limited in term and threshold, and also be closely monitored by the","page_number":593,"box":{"x":116,"y":258,"width":688,"height":12}},{"id":"d1c77c7e-d462-44b7-8e8a-b1a8ed957671","block_type":"box","text":"independent members of the board. We consider it good practice for companies to put to a shareholder","page_number":593,"box":{"x":117,"y":273,"width":771,"height":12}},{"id":"8996e034-b3bb-4af0-9d9b-b7e3f7647b77","block_type":"box","text":"vote any mechanisms expected to be in place for more than 12 months.","page_number":593,"box":{"x":116,"y":289,"width":538,"height":12}},{"id":"95ebbd58-9503-4aaf-82a5-dd0966d480ef","block_type":"box","text":"Shareholder activism","page_number":593,"box":{"x":116,"y":320,"width":175,"height":9}},{"id":"ae7b3555-5e31-468c-8891-d49cf5f0a54d","block_type":"box","text":"When companies are the focus of an activism campaign, we may communicate with the activist to","page_number":593,"box":{"x":116,"y":351,"width":732,"height":12}},{"id":"b4c58817-6366-46e1-9198-64647acede31","block_type":"box","text":"understand their analysis and objectives, once they have publicly disclosed their campaign. We may","page_number":593,"box":{"x":117,"y":366,"width":748,"height":12}},{"id":"cc10d128-1fa7-4dce-9621-7d7b0725fbb3","block_type":"box","text":"also engage with company management and possibly board members, especially those the activist","page_number":593,"box":{"x":116,"y":382,"width":741,"height":12}},{"id":"0e3fe961-5db4-4b23-9549-4d81170264bb","block_type":"box","text":"may be seeking to replace. In our assessment, we evaluate various factors, including the concerns","page_number":593,"box":{"x":117,"y":397,"width":737,"height":12}},{"id":"c9dc7607-91a4-4fb7-86c4-1a8df96bc1f1","block_type":"box","text":"raised by the activist and the case for change; the quality of both the activist’s and management’s","page_number":593,"box":{"x":117,"y":413,"width":728,"height":12}},{"id":"eb169589-e345-47ed-85a7-823c9c16f46f","block_type":"box","text":"plans; and the qualifications of each party’s candidates. We evaluate each contested situation by","page_number":593,"box":{"x":117,"y":428,"width":723,"height":12}},{"id":"8e368098-dd50-4317-b167-b9a6ada79ff6","block_type":"box","text":"assessing the potential financial outcome for our clients as minority shareholders.","page_number":593,"box":{"x":116,"y":444,"width":610,"height":12}},{"id":"f906c5f2-efb0-46fc-90a5-bca762f1bf79","block_type":"box","text":"We may support board candidates nominated by a shareholder activist if BAIS, in its independent","page_number":593,"box":{"x":116,"y":475,"width":728,"height":12}},{"id":"ac93e446-5e18-402e-a638-f78d78fb7cc6","block_type":"box","text":"judgment, or the relevant portfolio manager has determined that there is a case for change to enhance","page_number":593,"box":{"x":115,"y":490,"width":767,"height":12}},{"id":"c890372b-405f-4077-a694-df34442fdf92","block_type":"box","text":"shareholder value, or if the incumbent board members do not demonstrate the relevant skills and","page_number":593,"box":{"x":116,"y":506,"width":725,"height":11}},{"id":"8a437530-672c-4306-b6d2-f48e8a83fc71","block_type":"box","text":"expertise or have a poor track record of protecting shareholders’ interests.","page_number":593,"box":{"x":116,"y":521,"width":556,"height":12}},{"id":"0b4e4ac8-5b21-4e30-a0c8-1248fd28d34e","block_type":"box","text":"Significant shareholders and related party transactions","page_number":593,"box":{"x":116,"y":552,"width":446,"height":12}},{"id":"f1211a4c-d575-4b57-8568-9502cb37ec0e","block_type":"box","text":"Boards of companies with affiliated shareholders or directors should give equitable consideration to the","page_number":593,"box":{"x":117,"y":583,"width":768,"height":12}},{"id":"78f992c5-ce6a-4052-af94-54ee2fd62ffa","block_type":"box","text":"interests of all shareholders when evaluating related party transactions.","page_number":593,"box":{"x":117,"y":599,"width":534,"height":12}},{"id":"17509758-0a66-4225-ac99-10e316ca88f4","block_type":"box","text":"We consider it good practice for transactions with related parties, such as significant shareholders or","page_number":593,"box":{"x":116,"y":630,"width":751,"height":12}},{"id":"c14bf9d0-e136-4783-8763-81f3ed1cd5f8","block_type":"box","text":"companies affiliated with the public company, to be disclosed in detail and conducted on terms similar","page_number":593,"box":{"x":116,"y":645,"width":760,"height":12}},{"id":"3844b9fa-0375-4aea-b3c2-e319dbccc0a1","block_type":"box","text":"to what would objectively have been agreed with a non-related party. In our view, such transactions","page_number":593,"box":{"x":116,"y":661,"width":737,"height":12}},{"id":"f1414eba-4f60-423b-a411-6fb7654918f9","block_type":"box","text":"should be reviewed and approved by the independent members of the board, and if voted on, only","page_number":593,"box":{"x":116,"y":676,"width":729,"height":12}},{"id":"a04e5ece-6185-429c-abff-8a7667934389","block_type":"box","text":"disinterested shareholders should vote.","page_number":593,"box":{"x":116,"y":692,"width":291,"height":9}},{"id":"f7882775-6345-4cec-b5a9-c892883e41a3","block_type":"box","text":"Corporate reporting, risk management and audit","page_number":593,"box":{"x":307,"y":723,"width":385,"height":12}},{"id":"ba3f7316-7e69-4cb2-9d58-8a7a8ae9e443","block_type":"box","text":"Investors depend on corporate reporting, both regulatory and voluntary, to understand a company’s","page_number":593,"box":{"x":117,"y":754,"width":737,"height":12}},{"id":"71b3f8aa-79d1-43f6-b421-58b5c086fb96","block_type":"box","text":"strategy, its implementation and financial performance, as well as to assess the quality of management","page_number":593,"box":{"x":116,"y":769,"width":765,"height":12}},{"id":"d24fe3be-96b9-4334-8d7d-d0d5c130c82a","block_type":"box","text":"and operations and potential for the company to create shareholder value over time. We consider it","page_number":593,"box":{"x":116,"y":785,"width":736,"height":12}},{"id":"3192cbab-27d5-4745-8236-6b62fafc5e22","block_type":"box","text":"good practice for the board to oversee corporate reporting and the policies and procedures","page_number":593,"box":{"x":116,"y":800,"width":674,"height":12}},{"id":"37d5d9f3-752e-4cc9-9f9f-25dcb4e0cf0e","block_type":"box","text":"underpinning the internal audit function and external audit.","page_number":593,"box":{"x":117,"y":816,"width":430,"height":12}},{"id":"b15045a6-c720-4d1a-b7e5-da112b571cb4","block_type":"box","text":"A company’s financial reporting should provide decision-useful information for investors, and other","page_number":593,"box":{"x":116,"y":847,"width":734,"height":12}},{"id":"a45cf961-87a3-431e-9c32-fd3d74964223","block_type":"box","text":"stakeholders, on its financial performance and position. It should provide an accurate and balanced","page_number":593,"box":{"x":116,"y":862,"width":742,"height":12}},{"id":"b4e643d2-930a-4c9b-aacc-5ebe638ece78","block_type":"box","text":"assessment of the risks and opportunities the company faces in realizing its long-term strategy.","page_number":593,"box":{"x":116,"y":878,"width":712,"height":12}},{"id":"7eb8e1ec-ae2f-4dfe-98a1-39e4134297bb","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":593,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"d6501e17-c60f-4982-80b3-8b100a914ea7","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":593,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"85be1516-7e09-4952-b15b-5d9b5fc2c883","block_type":"box","text":"12","page_number":593,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"21a54013-b4a7-4886-9d90-b485fb9d6520","block_type":"box","text":"NM1026U-6004382-593/605","page_number":593,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"8a5432d7-e9e3-4873-a90b-7e72730a9d18","block_type":"box","text":"Accordingly, the assumptions made by management and reviewed by the auditor in preparing the","page_number":594,"box":{"x":116,"y":87,"width":729,"height":12}},{"id":"5c4d3618-f718-4cc6-b0fd-e55d7be2f9a4","block_type":"box","text":"financial statements should be reasonable and justified. Financial statements should be prepared in","page_number":594,"box":{"x":116,"y":102,"width":744,"height":13}},{"id":"c478d28b-5f86-45a1-8719-cd3685088c8f","block_type":"box","text":"accordance with globally developed reporting standards and any divergence from generally accepted","page_number":594,"box":{"x":116,"y":118,"width":755,"height":12}},{"id":"498fba55-81d5-4061-bf90-835843c76a68","block_type":"box","text":"accounting principles should be explained in detail and justified. Accounting restatements should be","page_number":594,"box":{"x":116,"y":134,"width":745,"height":12}},{"id":"74aff30f-1f03-4ec0-a8c7-5942fee92c17","block_type":"box","text":"explained in detail and any remedial actions, and the implications of these, disclosed.","page_number":594,"box":{"x":116,"y":149,"width":638,"height":12}},{"id":"35322305-7acd-4f3f-8cb0-5a6560fc874d","block_type":"box","text":"In this context, audit committees play a vital role in a company’s financial reporting system by providing","page_number":594,"box":{"x":117,"y":180,"width":769,"height":12}},{"id":"6ec0589d-7b90-402e-b1e2-6ee77258f2e9","block_type":"box","text":"independent oversight of the accounts, material financial and, where appropriate to the jurisdiction,","page_number":594,"box":{"x":117,"y":196,"width":737,"height":12}},{"id":"2218b564-1223-4c45-a0d8-22be55053a4a","block_type":"box","text":"non-financial information, internal control frameworks and Enterprise Risk Management systems. In","page_number":594,"box":{"x":117,"y":211,"width":743,"height":12}},{"id":"db9b50c0-74fd-4ef2-89e5-f82dc9e746f6","block_type":"box","text":"our view, effective audit committee oversight strengthens the quality and reliability of a company’s","page_number":594,"box":{"x":116,"y":227,"width":730,"height":12}},{"id":"25edf50b-d7db-42dd-bbc9-6d7cf378f1a8","block_type":"box","text":"financial statements and provides an important level of reassurance to shareholders. Audit committees","page_number":594,"box":{"x":116,"y":242,"width":767,"height":12}},{"id":"4f48536e-d14a-438e-9925-434b06ba0147","block_type":"box","text":"should have a procedure in place for assessing the independence of the auditor and the quality of the","page_number":594,"box":{"x":116,"y":258,"width":758,"height":12}},{"id":"e26d94db-1fae-48f3-be7a-806911933a56","block_type":"box","text":"external audit process annually.","page_number":594,"box":{"x":116,"y":273,"width":241,"height":12}},{"id":"c7f5187c-9fe1-4111-83fb-ffc06808db53","block_type":"box","text":"Similarly, we encourage companies to disclose material sustainability-related factors that are integral to","page_number":594,"box":{"x":116,"y":304,"width":771,"height":12}},{"id":"e4b040f2-1e38-4a24-9fe8-ec799e8ae1ec","block_type":"box","text":"how a company manages risks or generates revenue. BAIS finds it helpful to our understanding when","page_number":594,"box":{"x":117,"y":320,"width":758,"height":12}},{"id":"68200532-2dbe-418b-8ff0-bcd04c426166","block_type":"box","text":"companies provide robust, standardized disclosures on their material sustainability-related risks and","page_number":594,"box":{"x":116,"y":335,"width":747,"height":12}},{"id":"165f001d-321b-454c-a56d-e2585f6bf8f2","block_type":"box","text":"opportunities. The International Sustainability Standards Board (ISSB) is one entity working to meet","page_number":594,"box":{"x":116,"y":351,"width":743,"height":12}},{"id":"35e9ef34-7b22-4f53-81d2-11f9830f5304","block_type":"box","text":"these objectives through its reporting standards, which may be helpful to companies in preparing such","page_number":594,"box":{"x":116,"y":366,"width":763,"height":12}},{"id":"b7c80826-e8be-43a6-bd98-5c25054b5abf","block_type":"box","text":"reports.","page_number":594,"box":{"x":117,"y":382,"width":54,"height":12}},{"id":"655b0304-7edd-44f2-8e94-314666b26121","block_type":"box","text":"9","page_number":594,"box":{"x":173,"y":382,"width":5,"height":6}},{"id":"9e0087a2-623a-42b4-87bf-71bd94b91603","block_type":"box","text":"However, we do not mandate any specific disclosure framework, and note that companies in","page_number":594,"box":{"x":179,"y":382,"width":696,"height":12}},{"id":"1bd7c014-e91f-48fe-9d7b-38006d3e208a","block_type":"box","text":"certain jurisdictions are subject to mandatory reporting requirements under standards specified by","page_number":594,"box":{"x":116,"y":397,"width":731,"height":12}},{"id":"e8dd9839-e117-4d9d-8f5e-32faade6e0c3","block_type":"box","text":"policy makers.","page_number":594,"box":{"x":117,"y":413,"width":105,"height":12}},{"id":"e05edaa4-9b32-4bb2-9c34-2abd56d76082","block_type":"box","text":"10","page_number":594,"box":{"x":224,"y":413,"width":11,"height":6}},{"id":"fcadcc06-84a7-4c52-a041-91b34adaa647","block_type":"box","text":"Companies should establish robust risk management and internal control processes appropriate to the","page_number":594,"box":{"x":117,"y":444,"width":765,"height":12}},{"id":"511031de-2c16-4187-a887-01cf2051c30a","block_type":"box","text":"company’s business, risk tolerance, and regulatory environment. A credible whistleblowing system for","page_number":594,"box":{"x":116,"y":459,"width":759,"height":12}},{"id":"d59b6372-30cf-454d-8a7e-5b4d47f4e16d","block_type":"box","text":"employees, and potentially other stakeholders, can be a useful mechanism for ensuring that senior","page_number":594,"box":{"x":116,"y":475,"width":738,"height":12}},{"id":"bb63c78f-28b6-4550-9295-b7c4eab10169","block_type":"box","text":"management and the board are aware of potential misconduct or breaches in risk management and","page_number":594,"box":{"x":117,"y":490,"width":745,"height":12}},{"id":"fd84c948-d54a-4d0b-9f41-82ecf2bfac11","block_type":"box","text":"internal control processes.","page_number":594,"box":{"x":117,"y":506,"width":200,"height":12}},{"id":"70010eb9-a7c9-404d-a4d4-143d9ab31c7d","block_type":"box","text":"A comprehensive audit conducted by an independent audit firm contributes to investor confidence in","page_number":594,"box":{"x":116,"y":537,"width":748,"height":12}},{"id":"003ef3b0-6b7b-4170-964f-1bb12206a463","block_type":"box","text":"the quality of corporate reporting. It is helpful when the audit report gives some insight into the scope","page_number":594,"box":{"x":116,"y":552,"width":752,"height":12}},{"id":"97864fc7-c43b-4c19-be00-3a558cc8c47d","block_type":"box","text":"and focus of the audit, as well as any critical audit matters identified and how these were resolved. A","page_number":594,"box":{"x":116,"y":568,"width":751,"height":12}},{"id":"e21f8dde-eb30-48d9-977f-d20d98f9047f","block_type":"box","text":"comprehensive and effective audit is time and resource intensive, and the audit fee should be","page_number":594,"box":{"x":116,"y":583,"width":700,"height":12}},{"id":"457bdc40-757e-4507-bb57-6dd758ac5c53","block_type":"box","text":"commensurate. Fees paid to the audit firm for non-audit consulting should not exceed the audit fee to a","page_number":594,"box":{"x":116,"y":599,"width":771,"height":12}},{"id":"c7ff2510-2923-4935-8177-a97dbd5e606c","block_type":"box","text":"degree that may prompt concerns about the independence of the audit. The audit committee should","page_number":594,"box":{"x":116,"y":614,"width":746,"height":12}},{"id":"a6543677-0992-40c1-940a-7bf31ff3f57d","block_type":"box","text":"explain its position on auditor tenure and how it confirmed that the auditor remained independent.","page_number":594,"box":{"x":116,"y":630,"width":728,"height":12}},{"id":"f583b81b-0818-4ab8-91ab-4a9704418327","block_type":"box","text":"We may vote against the election of the responsible directors if corporate reporting is insufficient or","page_number":594,"box":{"x":116,"y":661,"width":735,"height":12}},{"id":"9b6d735c-5281-4271-97bf-af30a101b394","block_type":"box","text":"there are material misstatements in financial reports. In markets where relevant, we may vote against a","page_number":594,"box":{"x":116,"y":676,"width":766,"height":12}},{"id":"6997b743-17b5-40db-aadb-b766e8aa56c9","block_type":"box","text":"proposal to approve the financial statements or the discharge of the board when we are concerned","page_number":594,"box":{"x":117,"y":692,"width":731,"height":12}},{"id":"5e0b8fe3-de02-4f14-a000-f98014688228","block_type":"box","text":"about the quality of corporate reporting or the audit. We may vote against proposals to appoint the","page_number":594,"box":{"x":116,"y":707,"width":728,"height":12}},{"id":"f8d8d78d-5866-46b3-a9a0-821924bf8606","block_type":"box","text":"auditor, ratify the audit report, or approve the audit fee if we are concerned about the auditor’s","page_number":594,"box":{"x":116,"y":723,"width":697,"height":12}},{"id":"1228a8b4-c7c6-47ae-943d-62453529e294","block_type":"box","text":"independence, the quality of the audit, or there are material misstatements in financial reports and the","page_number":594,"box":{"x":117,"y":738,"width":754,"height":12}},{"id":"f94e9047-0c0e-4a8a-b3e3-b7561618c066","block_type":"box","text":"board has not established reasonable remediation plans.","page_number":594,"box":{"x":117,"y":754,"width":420,"height":12}},{"id":"03de7fb9-7b57-4a45-812d-e205f189bb54","block_type":"box","text":"9","page_number":594,"box":{"x":143,"y":815,"width":4,"height":5}},{"id":"8d73f3e3-53c1-40f2-92d6-542be5cb4aca","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Reporting Standards (IFRS)","page_number":594,"box":{"x":170,"y":815,"width":666,"height":10}},{"id":"7ff5b3c4-2f74-45d0-8380-8607988a2e1b","block_type":"box","text":"Foundation. Please refer to the IFRS website to learn more about the framework and standards S1 “General","page_number":594,"box":{"x":171,"y":828,"width":641,"height":8}},{"id":"131c16a2-0105-434e-85cc-040215bd9acb","block_type":"box","text":"Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related Disclosures.”","page_number":594,"box":{"x":171,"y":841,"width":672,"height":9}},{"id":"c370b328-623c-4ea5-8bb1-81f1c73710bc","block_type":"box","text":"10","page_number":594,"box":{"x":144,"y":854,"width":8,"height":5}},{"id":"6444793f-fbeb-4d03-b7b3-a275d8b86a61","block_type":"box","text":"See, for examples, https://www.ifrs.org/news-and-events/news/2025/06/ifrs-foundation-publishes-jurisdictional-profiles","page_number":594,"box":{"x":170,"y":854,"width":705,"height":9}},{"id":"c908afbf-8a95-4c55-b819-dc354450bb1d","block_type":"box","text":"issb-standards/ and https://finance.ec.europa.eu/capital-markets-union-and-financial-markets/company","page_number":594,"box":{"x":170,"y":867,"width":615,"height":9}},{"id":"ed1cea9c-9425-452f-8dfd-7118b5ca410b","block_type":"box","text":"reporting-and-auditing/company-reporting/corporate-sustainability-reporting_en","page_number":594,"box":{"x":170,"y":880,"width":468,"height":9}},{"id":"f65aab30-d0ca-4115-a5ec-c314b676bbe0","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":594,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"c9cc7517-b59f-49a3-b40f-45c54044f869","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":594,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"607d60d8-5cf7-45a6-9791-30d5181f008d","block_type":"box","text":"13","page_number":594,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"f0e60172-5600-4c66-bc59-c3246776dfd7","block_type":"box","text":"NM1026U-6004382-594/605","page_number":594,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"fd0afa8a-0666-43fb-9b90-b69ae876d3ac","block_type":"box","text":"Shareholder rights and protections","page_number":595,"box":{"x":360,"y":87,"width":285,"height":12}},{"id":"46ed4d7b-a853-4993-b08e-2378485110c0","block_type":"box","text":"General shareholder meetings","page_number":595,"box":{"x":116,"y":118,"width":247,"height":12}},{"id":"2a94ce36-9cba-4db8-ad04-0917318c9843","block_type":"box","text":"Companies normally have an annual general meeting of shareholders at which routine and non-routine","page_number":595,"box":{"x":117,"y":149,"width":768,"height":12}},{"id":"4b45efa5-9833-4975-8427-f91a3557d203","block_type":"box","text":"items of business are discussed and voted on by shareholders in attendance or submitting proxy votes.","page_number":595,"box":{"x":117,"y":165,"width":771,"height":12}},{"id":"a6c5227b-4fc4-458d-b556-28f3dc7d9049","block_type":"box","text":"Companies should disclose materials relevant to the shareholder meeting sufficiently in advance so","page_number":595,"box":{"x":117,"y":180,"width":742,"height":12}},{"id":"7e129469-70f2-4ae2-a308-13f1cc9d96be","block_type":"box","text":"that shareholders can take them into consideration in their voting decisions. Many companies offer","page_number":595,"box":{"x":116,"y":196,"width":736,"height":12}},{"id":"1ad2d47a-cc14-4a91-934b-af99928ad76f","block_type":"box","text":"shareholders the option of participating in the meeting virtually which, whilst welcome, should not limit","page_number":595,"box":{"x":116,"y":211,"width":758,"height":12}},{"id":"910d03a6-93bd-4554-85ad-e276bab85a74","block_type":"box","text":"the rights of shareholders to participate as they would during an in-person meeting.","page_number":595,"box":{"x":116,"y":227,"width":622,"height":12}},{"id":"e36fefa5-d742-4d82-93e2-caf779ac74f9","block_type":"box","text":"We may vote against directors when materials related to the business of the shareholder meeting are","page_number":595,"box":{"x":116,"y":258,"width":757,"height":12}},{"id":"753eef75-09d8-4aed-8198-03cec2c02c30","block_type":"box","text":"not provided in a timely manner or do not provide sufficient information for us to make an informed","page_number":595,"box":{"x":117,"y":273,"width":733,"height":12}},{"id":"2bfa2f2b-4765-41d1-9e86-805ef6a4c3cd","block_type":"box","text":"voting decision. We may vote against directors if the format of the shareholder meeting does not","page_number":595,"box":{"x":116,"y":289,"width":719,"height":12}},{"id":"a423bca3-8685-4f89-bd25-3ebd2cfa9889","block_type":"box","text":"accommodate reasonable shareholder participation.","page_number":595,"box":{"x":116,"y":304,"width":392,"height":12}},{"id":"f214ee36-6628-4617-98d4-5ecdf90d7131","block_type":"box","text":"Bylaw amendments","page_number":595,"box":{"x":117,"y":335,"width":161,"height":12}},{"id":"397c174b-449e-4466-ac56-1134da3240e5","block_type":"box","text":"We review bylaw amendments proposed by management on a case-by-case basis and will generally","page_number":595,"box":{"x":116,"y":366,"width":753,"height":12}},{"id":"35f3d3ed-0b7d-4c8b-b282-387a1d1c9873","block_type":"box","text":"support those that are aligned with the interests of minority shareholders. Any material changes to the","page_number":595,"box":{"x":116,"y":382,"width":761,"height":12}},{"id":"b79b6bc0-5db4-4d52-8a30-7ef9250e4b49","block_type":"box","text":"bylaws should be explained in detail and put to a shareholder vote.","page_number":595,"box":{"x":117,"y":397,"width":500,"height":12}},{"id":"7041ab62-8749-494c-b3c4-b8bed937bad1","block_type":"box","text":"We may vote against bylaw amendments that reduce shareholder rights and protections or introduce","page_number":595,"box":{"x":116,"y":428,"width":753,"height":12}},{"id":"37944e69-2fbd-47e1-877d-7425e65c144f","block_type":"box","text":"additional burdens. We may vote against directors if material changes are made to the bylaws without","page_number":595,"box":{"x":116,"y":444,"width":760,"height":12}},{"id":"e9d62f96-bda4-498c-b06e-c201cdb6d763","block_type":"box","text":"shareholder approval.","page_number":595,"box":{"x":116,"y":459,"width":167,"height":12}},{"id":"ed370ba5-c7ed-4ca2-986f-073f8fb766ca","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders,","page_number":595,"box":{"x":117,"y":490,"width":688,"height":12}},{"id":"5e017d4c-9375-43b9-bc70-5775568e6c4a","block_type":"box","text":"individually or as a group, with a meaningful shareholding, the right to call a special meeting of","page_number":595,"box":{"x":117,"y":506,"width":704,"height":12}},{"id":"394d212e-ba7f-4d9b-b12c-a31d751adc8d","block_type":"box","text":"shareholders. The shareholding required to exercise this right should balance its utility with the cost to","page_number":595,"box":{"x":116,"y":521,"width":761,"height":12}},{"id":"555a07da-3c78-4bbc-ae6e-bdd6132963e2","block_type":"box","text":"the company of holding special meetings.","page_number":595,"box":{"x":116,"y":537,"width":313,"height":12}},{"id":"99c1104e-fbaf-4e9b-a4b8-a91487e7bca8","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders,","page_number":595,"box":{"x":117,"y":568,"width":688,"height":12}},{"id":"454a812e-9c51-479e-b0ac-1fce10ddc28d","block_type":"box","text":"individually or as a group, with a meaningful shareholding, the right to nominate directors to the","page_number":595,"box":{"x":117,"y":583,"width":710,"height":12}},{"id":"5687a810-daf8-4ed9-bd2b-a088c31f4c57","block_type":"box","text":"company’s board. The threshold for this right should be set so that shareholders can exercise it without","page_number":595,"box":{"x":116,"y":599,"width":770,"height":12}},{"id":"ade86532-7cfd-460c-9511-28f7f387b42e","block_type":"box","text":"being unduly disruptive to the board’s own nomination process.","page_number":595,"box":{"x":117,"y":614,"width":473,"height":12}},{"id":"3a3e1a1b-b9ba-4a27-b314-aaefc929a8c5","block_type":"box","text":"Whilst we would not use either of these rights ourselves, we see them as important accountability","page_number":595,"box":{"x":116,"y":645,"width":728,"height":12}},{"id":"88a67811-2b68-4b1b-a816-6646a8df078b","block_type":"box","text":"mechanisms. We may vote for a shareholder proposal seeking the addition of either of these","page_number":595,"box":{"x":117,"y":661,"width":686,"height":12}},{"id":"8538ee3f-2391-4609-a990-9f0d02afeaaf","block_type":"box","text":"provisions to a company’s bylaws.","page_number":595,"box":{"x":117,"y":676,"width":252,"height":12}},{"id":"9436df10-43da-4494-ac05-bfd7d13db7b6","block_type":"box","text":"Change of domicile","page_number":595,"box":{"x":116,"y":707,"width":154,"height":12}},{"id":"6a746ee7-d6e3-462b-a760-9261481f26b7","block_type":"box","text":"We generally defer to management on proposals to change a company’s domicile as long as the","page_number":595,"box":{"x":116,"y":738,"width":717,"height":12}},{"id":"d5f81ab3-34f2-45db-b292-85bb5137d127","block_type":"box","text":"rationale for doing so is consistent with the company’s long-term strategy and business model and the","page_number":595,"box":{"x":117,"y":754,"width":756,"height":12}},{"id":"5f10c964-5fa2-4cd2-a933-1f10bd42a2ef","block_type":"box","text":"related costs are immaterial.","page_number":595,"box":{"x":117,"y":769,"width":209,"height":10}},{"id":"21d63814-5cef-45c1-a02f-057abc334059","block_type":"box","text":"We may vote against directors or a proposal to change a company’s domicile where it does not seem","page_number":595,"box":{"x":116,"y":800,"width":751,"height":12}},{"id":"0e8b6b14-958f-4b51-a6cb-5c9ab5cffe2b","block_type":"box","text":"aligned with our clients’ financial interests.","page_number":595,"box":{"x":116,"y":816,"width":311,"height":12}},{"id":"af277f95-a598-4c41-9812-f3052a5d1167","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":595,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"164095be-5925-4f53-9bcb-5d6276a72f8f","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":595,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"5b94d2a6-ae9c-407f-b063-4db818ef7817","block_type":"box","text":"14","page_number":595,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"14fed678-2ff2-49b1-91fa-af43da76832d","block_type":"box","text":"NM1026U-6004382-595/605","page_number":595,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"1d1733da-f9ef-47c3-a7e4-6b0f67512ea4","block_type":"box","text":"Changes to a company’s purpose or the nature of its business","page_number":596,"box":{"x":116,"y":87,"width":504,"height":12}},{"id":"0a73e965-91ec-4e6e-92bc-704aa26a09ea","block_type":"box","text":"Plans to materially change the nature of a company’s business or its purpose should be disclosed and","page_number":596,"box":{"x":117,"y":118,"width":762,"height":12}},{"id":"db310561-6334-4fa9-be6b-d6725068c47a","block_type":"box","text":"explained in the context of long-term strategy and business dynamics. Such changes may significantly","page_number":596,"box":{"x":116,"y":134,"width":764,"height":12}},{"id":"ccc84910-0c79-41d6-8b40-373f59b630e3","block_type":"box","text":"alter an investor’s views on the suitability of a company for their investment strategy or portfolio.","page_number":596,"box":{"x":116,"y":149,"width":716,"height":12}},{"id":"81ceac11-cbee-4620-8ac1-7905162960c9","block_type":"box","text":"Where relevant, we may vote against proposals to change a company’s purpose or the nature of its","page_number":596,"box":{"x":116,"y":180,"width":743,"height":12}},{"id":"7c56e7e9-9ff3-46ed-9d64-1526054fa794","block_type":"box","text":"business if the board has not provided a credible argument for change.","page_number":596,"box":{"x":117,"y":196,"width":530,"height":12}},{"id":"92a5facf-726a-42d1-be03-06b5bb95729e","block_type":"box","text":"Shareholder proposals","page_number":596,"box":{"x":409,"y":227,"width":187,"height":11}},{"id":"b7785ad6-2cd8-4938-88e4-988ff6eccf8c","block_type":"box","text":"Shareholders in many markets, who meet certain eligibility criteria, have the right to submit proposals","page_number":596,"box":{"x":116,"y":258,"width":756,"height":12}},{"id":"b04d0663-fa8e-46d1-83b3-b79c6845327c","block_type":"box","text":"to the general shareholder meeting asking a company to take a particular course of action subject to","page_number":596,"box":{"x":116,"y":273,"width":749,"height":12}},{"id":"0716d1d6-9137-4790-9f70-12479624473e","block_type":"box","text":"the proposal being supported by a majority of votes cast at the meeting. The topics raised can address","page_number":596,"box":{"x":116,"y":289,"width":767,"height":12}},{"id":"9d11aad2-050f-4054-9f6e-6ddec7e41e01","block_type":"box","text":"a range of matters that may be relevant to a company’s business.","page_number":596,"box":{"x":116,"y":304,"width":492,"height":12}},{"id":"3c34b359-cdac-4969-b35b-6da01b83c21b","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":596,"box":{"x":116,"y":335,"width":767,"height":12}},{"id":"46c5e1b3-4be9-417b-acfe-0444d072cb7a","block_type":"box","text":"company’s business and its current approach, whether the actions sought are consistent with","page_number":596,"box":{"x":116,"y":351,"width":697,"height":12}},{"id":"daa0b243-cbe9-419a-8619-f513b5dfe6ce","block_type":"box","text":"shareholders’ interests, and what impact the proposal being acted upon might have on financial","page_number":596,"box":{"x":116,"y":366,"width":714,"height":12}},{"id":"011f459e-c300-4596-9f2d-225f45b84bd2","block_type":"box","text":"performance.","page_number":596,"box":{"x":117,"y":382,"width":103,"height":12}},{"id":"f67f4037-afbd-437d-a6ec-f3f64d423b4e","block_type":"box","text":"Our general approach where we have concerns about a company’s governance, disclosures or","page_number":596,"box":{"x":116,"y":413,"width":711,"height":12}},{"id":"e212174a-745f-4699-8f6e-9c037a16bc2e","block_type":"box","text":"performance is to engage to understand the apparent difference in perspective. If we are concerned a","page_number":596,"box":{"x":117,"y":428,"width":760,"height":12}},{"id":"93f0e42d-7842-43f6-901b-a7777db4e52d","block_type":"box","text":"company is not acting in shareholders’ financial interests, we may vote against the election of directors.","page_number":596,"box":{"x":116,"y":444,"width":772,"height":12}},{"id":"ddcab7b0-524f-468c-b124-ceb5cf4f1e05","block_type":"box","text":"We may support a relevant shareholder proposal if doing so is aligned with our clients’ financial","page_number":596,"box":{"x":116,"y":459,"width":712,"height":12}},{"id":"34ad724a-e9ae-45ff-b993-dc6ccc2e72cd","block_type":"box","text":"interests. We generally do not support shareholder proposals that are legally binding on the company,","page_number":596,"box":{"x":117,"y":475,"width":760,"height":12}},{"id":"e5fd0a91-b556-40ed-9d61-ac1d57f57cf6","block_type":"box","text":"seek to alter a company’s strategy or direct its operations, or are unrelated to how a company","page_number":596,"box":{"x":116,"y":490,"width":700,"height":12}},{"id":"8a60dcab-a5d6-4e4e-bc64-ef55d246d9a7","block_type":"box","text":"manages risk or generates financial returns.","page_number":596,"box":{"x":117,"y":506,"width":331,"height":12}},{"id":"6897c182-0e15-43a0-bb62-f5d3d53042ab","block_type":"box","text":"BlackRock is subject to rules, regulations, agency guidance and contractual agreements that place","page_number":596,"box":{"x":117,"y":537,"width":737,"height":12}},{"id":"3e3ef94d-0a3e-4d2a-89f0-a95e08686ad1","block_type":"box","text":"restrictions and limitations on how we can interact with the companies in which we invest on behalf of","page_number":596,"box":{"x":117,"y":552,"width":755,"height":12}},{"id":"dc08ef8f-1243-4aeb-9735-55e077e04832","block_type":"box","text":"our clients, including our ability to submit shareholder proposals. We do not submit shareholder","page_number":596,"box":{"x":116,"y":568,"width":712,"height":12}},{"id":"6deb6d34-ac76-48c9-bb56-788cc37f62c0","block_type":"box","text":"proposals but can vote, on behalf of clients who authorize us to do so, on proposals put forth by others.","page_number":596,"box":{"x":117,"y":583,"width":770,"height":12}},{"id":"1e2fec68-7fe5-41f5-bae4-28ff19b4500f","block_type":"box","text":"Corporate political activities","page_number":596,"box":{"x":387,"y":614,"width":230,"height":12}},{"id":"049eb875-4026-4dfe-9287-b76cfc49f54f","block_type":"box","text":"A corporation’s ability to engage in the policy process is subject to rules and regulations set by the","page_number":596,"box":{"x":116,"y":645,"width":733,"height":12}},{"id":"e6c9e646-b69a-49b6-8e2b-325ae52ec4ed","block_type":"box","text":"jurisdictions in which they engage. When a corporation reports material financial risk related to policy","page_number":596,"box":{"x":115,"y":661,"width":749,"height":12}},{"id":"3e0dbebe-57bd-4f47-a844-a910974a7840","block_type":"box","text":"and or regulatory changes, BAIS may seek to understand how it is addressing the material risk","page_number":596,"box":{"x":116,"y":676,"width":703,"height":12}},{"id":"1cdecea5-6a46-40c2-bbdf-c1bc1285fb97","block_type":"box","text":"identified. We seek to understand how companies engage in corporate political activities and ensure","page_number":596,"box":{"x":117,"y":692,"width":743,"height":12}},{"id":"c00e7b3d-927f-4c2f-bd89-3a75a94b9bdf","block_type":"box","text":"that their participation is consistent with their public statements on policy matters material to the","page_number":596,"box":{"x":116,"y":707,"width":709,"height":12}},{"id":"0eb004ce-567c-4bee-8a08-1e27b29275cc","block_type":"box","text":"company’s long-term strategy. The board should be aware of the approach taken by management on","page_number":596,"box":{"x":116,"y":723,"width":750,"height":12}},{"id":"071c3791-18d1-40b8-b0d2-a6788c8f940e","block_type":"box","text":"corporate political activities as there can be reputational risks arising from inconsistencies between a","page_number":596,"box":{"x":116,"y":738,"width":746,"height":12}},{"id":"3c1d9103-5a27-42a0-99f7-3e51435f9e06","block_type":"box","text":"company’s policy engagement and stated policy positions. Companies should, as a minimum, meet all","page_number":596,"box":{"x":116,"y":754,"width":758,"height":12}},{"id":"a33a36c2-813b-444b-953f-442154935318","block_type":"box","text":"regulatory disclosure requirements on political activities. We may engage a company where we would","page_number":596,"box":{"x":117,"y":769,"width":753,"height":12}},{"id":"44275adc-306d-4a58-a3ec-c51fa1cea55b","block_type":"box","text":"like to better understand its approach to policy engagement, where relevant.","page_number":596,"box":{"x":117,"y":785,"width":563,"height":12}},{"id":"1861e230-3408-4b81-a99a-c658f22736b5","block_type":"box","text":"To mitigate the risk of inconsistencies, companies may wish to assess the alignment between their","page_number":596,"box":{"x":116,"y":816,"width":732,"height":12}},{"id":"191aef0a-7252-44aa-a304-b26de1c5035b","block_type":"box","text":"policy priorities and the policy positions of the trade associations of which they are active members and","page_number":596,"box":{"x":117,"y":831,"width":770,"height":12}},{"id":"15e1caac-fbc3-4054-9e91-5ddca8238771","block_type":"box","text":"any engagements undertaken by trade associations on behalf of members.","page_number":596,"box":{"x":116,"y":847,"width":562,"height":12}},{"id":"f2666cb6-ba36-476e-b517-39311a9f7088","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":596,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"78485495-d4ab-4eee-9a46-406d810fc4dc","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":596,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"9d37884f-3183-4a93-968b-55f348de7d43","block_type":"box","text":"15","page_number":596,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"1059c9ea-be6d-42ba-bec0-973b570a47eb","block_type":"box","text":"NM1026U-6004382-596/605","page_number":596,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f88d46a2-5ae2-448b-8fb9-2ca5e3a71335","block_type":"box","text":"We may support a relevant shareholder proposal, or vote against directors, where a company’s","page_number":597,"box":{"x":116,"y":87,"width":712,"height":12}},{"id":"04fc9062-f17c-4381-8a70-61792ce0a57e","block_type":"box","text":"disclosures are insufficient to address the material risk it has identified.","page_number":597,"box":{"x":116,"y":102,"width":530,"height":10}},{"id":"f8489c4e-26b3-43cb-a109-f682e067f3c3","block_type":"box","text":"Material sustainability-related risks and opportunities","page_number":597,"box":{"x":287,"y":134,"width":431,"height":12}},{"id":"0106b299-9a27-40da-ba5f-73ff5cd58ebb","block_type":"box","text":"We seek to understand how companies manage the material risks and opportunities inherent in their","page_number":597,"box":{"x":116,"y":165,"width":751,"height":12}},{"id":"551a6599-2868-439c-9996-2e587864bdc2","block_type":"box","text":"business operations. In our experience, sustainability-related factors","page_number":597,"box":{"x":117,"y":180,"width":505,"height":12}},{"id":"dcab4042-87db-4c93-aaa9-4d9f7bcd5da8","block_type":"box","text":"11","page_number":597,"box":{"x":624,"y":180,"width":9,"height":6}},{"id":"56b498ed-579e-4292-a5fd-d5a3b67997f5","block_type":"box","text":"that are relevant to a company’s","page_number":597,"box":{"x":635,"y":180,"width":249,"height":12}},{"id":"019ad348-1434-4d20-88ad-6120e32b339e","block_type":"box","text":"business or material to its financial performance, are generally operational considerations embedded","page_number":597,"box":{"x":117,"y":196,"width":752,"height":12}},{"id":"38f8bb51-b0a0-43b0-80a3-ab048c949a9f","block_type":"box","text":"into day-to-day management systems. Certain sustainability issues may also inform long-term strategic","page_number":597,"box":{"x":117,"y":211,"width":769,"height":12}},{"id":"f6f20ef4-14ab-4b51-af5d-9ba8765c1faf","block_type":"box","text":"planning, for example, investing in product innovation in anticipation of changing consumer demand or","page_number":597,"box":{"x":117,"y":227,"width":763,"height":12}},{"id":"fcecdf35-7b27-49aa-9215-30035380ffad","block_type":"box","text":"adapting supply chains in response to changing regulatory requirements.","page_number":597,"box":{"x":116,"y":242,"width":546,"height":12}},{"id":"017f92ef-b374-44dc-9e3e-c7e1608b4c95","block_type":"box","text":"We recognize that the specific sustainability-related factors that may be financially material or business","page_number":597,"box":{"x":116,"y":273,"width":769,"height":12}},{"id":"1598c3aa-0bdc-4313-916b-49cb0be08742","block_type":"box","text":"relevant will vary by company business model, sector, key markets, and time horizon, amongst other","page_number":597,"box":{"x":117,"y":289,"width":751,"height":12}},{"id":"dcabcf7a-4996-4f25-9ad8-7f6cdeccd113","block_type":"box","text":"considerations. From company disclosures and our engagement, we aim to understand how","page_number":597,"box":{"x":116,"y":304,"width":689,"height":12}},{"id":"e06c6421-53d5-42bb-a7d8-9d733ba3aa31","block_type":"box","text":"management is identifying, assessing and integrating material sustainability-related risks and","page_number":597,"box":{"x":117,"y":320,"width":694,"height":12}},{"id":"41b30ed8-ffe2-4c38-98d1-ce75246579f1","block_type":"box","text":"opportunities into their business decision-making and practices. Doing so helps us undertake a more","page_number":597,"box":{"x":116,"y":335,"width":752,"height":12}},{"id":"95bef378-1f53-4acf-9507-36017df1c04c","block_type":"box","text":"holistic assessment of a company’s potential financial performance and the likely risk-adjusted returns","page_number":597,"box":{"x":117,"y":351,"width":761,"height":12}},{"id":"df5f4424-7147-4aca-bec9-6312e7c6293e","block_type":"box","text":"of an investment.","page_number":597,"box":{"x":116,"y":366,"width":133,"height":10}},{"id":"d285a74d-ecd3-493b-955d-131e8dca22c7","block_type":"box","text":"We may vote against directors or support a relevant shareholder proposal if we have concerns about","page_number":597,"box":{"x":116,"y":397,"width":753,"height":12}},{"id":"10590fdf-97f4-46a8-ae88-297913d31e1d","block_type":"box","text":"how a company is managing or disclosing its approach to material sustainability-related risks that may","page_number":597,"box":{"x":117,"y":413,"width":761,"height":12}},{"id":"f6757fc3-182e-4a5e-9452-d885683da243","block_type":"box","text":"impact financial returns.","page_number":597,"box":{"x":117,"y":428,"width":181,"height":12}},{"id":"3d3b40e1-1bbb-4e19-995a-b2b7e69cf4d2","block_type":"box","text":"Key stakeholders","page_number":597,"box":{"x":431,"y":459,"width":143,"height":12}},{"id":"081e52fa-ee85-4ac6-bc90-eb24668ae167","block_type":"box","text":"In our view, companies should understand and take into consideration the interests of the various","page_number":597,"box":{"x":117,"y":490,"width":727,"height":12}},{"id":"218f95d4-4ff4-47c7-b2e1-253f0059abae","block_type":"box","text":"parties on whom they depend for their success over time. It is for each company to determine their key","page_number":597,"box":{"x":117,"y":506,"width":766,"height":12}},{"id":"33076d97-251a-48ea-beae-0e556ac800b6","block_type":"box","text":"stakeholders based on what is material to their business and long-term financial performance. For","page_number":597,"box":{"x":116,"y":521,"width":731,"height":12}},{"id":"9590e8d5-a8e7-4a8d-ad8c-bd80fecce725","block_type":"box","text":"many companies, key stakeholders include employees, business partners (such as suppliers and","page_number":597,"box":{"x":117,"y":537,"width":726,"height":12}},{"id":"e7bbe559-4ac3-46e1-aa0c-e5c57e2d6ddd","block_type":"box","text":"distributors), clients and consumers, regulators, and the communities in which they operate.","page_number":597,"box":{"x":116,"y":552,"width":687,"height":12}},{"id":"ade65c86-1144-4543-9e16-38ffc38b7713","block_type":"box","text":"Companies that appropriately balance the interests of investors and other stakeholders are, in our","page_number":597,"box":{"x":117,"y":568,"width":730,"height":12}},{"id":"728d3453-cf48-4b2c-87ca-debf80e70154","block_type":"box","text":"experience, more likely to be financially resilient over time.","page_number":597,"box":{"x":116,"y":583,"width":438,"height":12}},{"id":"003e28c3-07dc-4ee8-939e-cdb7be15d4d6","block_type":"box","text":"Climate and decarbonization investment objectives","page_number":597,"box":{"x":295,"y":614,"width":414,"height":12}},{"id":"63520403-87ef-4a65-8c1f-ca6d1aef592f","block_type":"box","text":"Certain active BlackRock funds have climate and decarbonization objectives in addition to financial","page_number":597,"box":{"x":117,"y":645,"width":737,"height":12}},{"id":"06c976bc-3ab8-4052-93d3-6072d2890c29","block_type":"box","text":"objectives. Consistent with the objectives of those investment strategies, our stewardship activity in","page_number":597,"box":{"x":116,"y":661,"width":735,"height":12}},{"id":"340ed83a-4c0a-4159-831b-7f1f8299bda4","block_type":"box","text":"relation to the holdings in those funds differs in some respects from BAIS’ benchmark guidelines, which","page_number":597,"box":{"x":117,"y":676,"width":765,"height":12}},{"id":"27dd8fb1-1fda-4227-8842-9039c74eaa10","block_type":"box","text":"are described above. Specifically, for those funds’ holdings, we look to investee companies to","page_number":597,"box":{"x":116,"y":692,"width":694,"height":12}},{"id":"2c45271b-0e06-447b-8fec-7482e13194ac","block_type":"box","text":"demonstrate that they are aligned with a decarbonization pathway that means their business model","page_number":597,"box":{"x":116,"y":707,"width":736,"height":12}},{"id":"496677b9-7d7d-475a-bb09-9e708496633e","block_type":"box","text":"would be viable in a low-carbon economy, i.e., one in which global temperature rise is limited to 1.5°C","page_number":597,"box":{"x":116,"y":723,"width":754,"height":12}},{"id":"078cd7d9-449a-49b6-bb79-0b227d2bea82","block_type":"box","text":"11","page_number":597,"box":{"x":144,"y":776,"width":7,"height":5}},{"id":"2f3b6d46-0558-4a02-8557-10768019795f","block_type":"box","text":"By material sustainability-related risks and opportunities, we mean the drivers of risk and financial value creation in a","page_number":597,"box":{"x":171,"y":776,"width":691,"height":10}},{"id":"1356399b-b3e4-43ab-8076-a67167c24110","block_type":"box","text":"company’s business model that have an environmental or social dependency or impact. Examples of environmental","page_number":597,"box":{"x":170,"y":789,"width":686,"height":10}},{"id":"ab87c369-d55e-4adb-b7a2-bdb0a48c17d9","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":597,"box":{"x":170,"y":802,"width":682,"height":10}},{"id":"4628d70e-42d0-443a-b75c-50426735c91b","block_type":"box","text":"issues include, but are not limited to, human capital management, impacts on the communities in which a company","page_number":597,"box":{"x":170,"y":815,"width":683,"height":10}},{"id":"03f31db1-2c77-4423-955d-3a7bfe14af04","block_type":"box","text":"operates, customer loyalty, and relationships with regulators. It is our view that well-managed companies will effectively","page_number":597,"box":{"x":170,"y":828,"width":708,"height":10}},{"id":"77dbb859-1d74-4e6c-a5f1-c098014b9a2d","block_type":"box","text":"evaluate and manage material sustainability-related risks and opportunities relevant to their businesses. Governance is","page_number":597,"box":{"x":170,"y":841,"width":707,"height":9}},{"id":"8ce35420-9401-4f4c-88d4-592c0ca4eb42","block_type":"box","text":"the core means by which boards can oversee the creation of durable financial value over time. Appropriate risk","page_number":597,"box":{"x":170,"y":854,"width":658,"height":9}},{"id":"46c96607-8b42-43ea-a1fc-84d7f5f80c65","block_type":"box","text":"oversight of business-relevant and material sustainability-related considerations is a component of a sound governance","page_number":597,"box":{"x":170,"y":867,"width":708,"height":9}},{"id":"a393f397-7768-47a0-b7ba-f11b7705a965","block_type":"box","text":"framework.","page_number":597,"box":{"x":170,"y":880,"width":65,"height":7}},{"id":"58d58661-b467-4fca-9d0e-b28c9eeddb57","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":597,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"e21e36f8-1ac8-4868-b0b3-22fa55ebf4df","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":597,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"1281f06a-2531-4e85-a6d8-d62866a9fc43","block_type":"box","text":"16","page_number":597,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"dff06df8-9d03-4c68-bc86-f23273d1bc89","block_type":"box","text":"NM1026U-6004382-597/605","page_number":597,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"952fccfc-8218-4cac-91b1-a1fabef4e811","block_type":"box","text":"above pre-industrial levels. In addition, clients in separately managed accounts may instruct BlackRock","page_number":598,"box":{"x":116,"y":87,"width":771,"height":12}},{"id":"144f86c6-8bb5-4ee3-89ab-11cb9ce97228","block_type":"box","text":"to apply these guidelines to their holdings. Both in the case of funds and separately managed","page_number":598,"box":{"x":116,"y":102,"width":698,"height":13}},{"id":"c9a853d9-6464-48bb-9b84-dc583ce0ed09","block_type":"box","text":"accounts, these guidelines are only implemented upon explicit selection and approval by the applicable","page_number":598,"box":{"x":116,"y":118,"width":770,"height":12}},{"id":"8025bd40-a326-4a61-a4bd-e2149f8fc4c7","block_type":"box","text":"fund board or client.","page_number":598,"box":{"x":116,"y":134,"width":153,"height":9}},{"id":"f0529ea5-a514-474f-ae75-da13d77f06dc","block_type":"box","text":"These decarbonization stewardship guidelines focus on companies which produce goods and services","page_number":598,"box":{"x":116,"y":165,"width":766,"height":12}},{"id":"f9fb2f4f-f9bc-4eb6-a7d3-5a957ef33d2a","block_type":"box","text":"that contribute to real world decarbonization or have a carbon intensive business model and face","page_number":598,"box":{"x":116,"y":180,"width":724,"height":10}},{"id":"aa6cadd4-e9dd-45b9-a0a2-8e311b7edeb4","block_type":"box","text":"outsized impacts from the low carbon transition, based on reported and estimated scopes 1, 2, and 3","page_number":598,"box":{"x":116,"y":196,"width":754,"height":11}},{"id":"e7a6c584-319f-43d8-bb12-af56e37cc5fa","block_type":"box","text":"greenhouse gas emissions. These companies should provide disclosures that set out their","page_number":598,"box":{"x":116,"y":211,"width":675,"height":12}},{"id":"c7471714-bd00-4712-b505-d435ad37bc9e","block_type":"box","text":"governance, strategy, risk management processes and metrics and targets relevant to","page_number":598,"box":{"x":116,"y":227,"width":646,"height":12}},{"id":"b1e54af3-e87d-4c01-a5a6-a4244a2e0693","block_type":"box","text":"decarbonization. It is helpful to investors’ understanding when these disclosures include an explanation","page_number":598,"box":{"x":116,"y":242,"width":770,"height":12}},{"id":"30a54130-9b3e-40cc-91e9-5593fcb16354","block_type":"box","text":"of the decarbonization scenarios a company is using in its near- and long-term planning, as well as its","page_number":598,"box":{"x":116,"y":258,"width":760,"height":12}},{"id":"4c73300f-3eec-44cf-ad3d-a46015f57503","block_type":"box","text":"scope 1, scope 2 and material scope 3 greenhouse gas (GHG) emissions and reduction targets for","page_number":598,"box":{"x":116,"y":273,"width":739,"height":12}},{"id":"642c9d09-4662-4944-ab29-724012b40b32","block_type":"box","text":"scope 1 and 2 emissions.","page_number":598,"box":{"x":116,"y":289,"width":194,"height":12}},{"id":"d013a95d-0ebb-4ec0-9cdf-13bb94c81847","block_type":"box","text":"Under these climate- and decarbonization-specific guidelines, BAIS may recommend a vote against","page_number":598,"box":{"x":117,"y":320,"width":744,"height":12}},{"id":"ac4a7711-ccf2-4e22-93b1-4946a171bef6","block_type":"box","text":"directors or support for a relevant shareholder proposal if a company does not appear to be adequately","page_number":598,"box":{"x":116,"y":335,"width":771,"height":12}},{"id":"b8af6c02-f7c7-4172-979a-ae71dabc1a50","block_type":"box","text":"acting to address or disclosing material climate-related risks, consistent with the parameters set out in","page_number":598,"box":{"x":116,"y":351,"width":761,"height":12}},{"id":"31fed228-761b-460a-b99b-7e35dd394f29","block_type":"box","text":"these climate- and decarbonization-specific guidelines. We may recommend supporting shareholder","page_number":598,"box":{"x":116,"y":366,"width":749,"height":12}},{"id":"97144a01-2f76-4cbc-9a29-8cf8932b97c7","block_type":"box","text":"proposals seeking information relevant to a company’s stated low-carbon transition strategy or targets","page_number":598,"box":{"x":117,"y":382,"width":760,"height":12}},{"id":"e48c912b-ede0-4f2d-8ba2-55fae20831a9","block_type":"box","text":"that the company does not currently provide and that would be helpful to investment decision-making.","page_number":598,"box":{"x":116,"y":397,"width":760,"height":12}},{"id":"d18a025d-2b15-46af-9f2d-da453389f29f","block_type":"box","text":"We would not recommend support for shareholder proposals that seek to constrain board or","page_number":598,"box":{"x":116,"y":413,"width":689,"height":12}},{"id":"c536e8ba-e427-4df2-b85d-ea0bb8602d5d","block_type":"box","text":"management decision-making or direct specific business or strategic decisions. As under the BAIS","page_number":598,"box":{"x":117,"y":428,"width":736,"height":12}},{"id":"e4631af1-c7fc-405e-94ad-1eb4b2634399","block_type":"box","text":"benchmark approach, the active portfolio managers are ultimately responsible for voting consistent","page_number":598,"box":{"x":117,"y":444,"width":737,"height":12}},{"id":"b4276206-a594-4789-81d1-765372e60d3e","block_type":"box","text":"with their investment mandate and fund objectives. For the funds and accounts in scope, voting on","page_number":598,"box":{"x":116,"y":459,"width":736,"height":12}},{"id":"0e98a757-22c6-4dd7-8596-fdd379197833","block_type":"box","text":"matters not related to climate risk and the energy transition is undertaken in line with BAIS’ benchmark","page_number":598,"box":{"x":117,"y":475,"width":765,"height":12}},{"id":"b097d145-2ab3-4df0-b693-5538f9b87e04","block_type":"box","text":"guidelines.","page_number":598,"box":{"x":116,"y":490,"width":85,"height":12}},{"id":"b9002c28-96d4-48e8-a6b0-1f46c5c66d29","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":598,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"68e76737-df5b-4dab-897c-08d913b64df9","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":598,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"4b21eb26-2cfe-441a-b150-3b51aa5ae952","block_type":"box","text":"17","page_number":598,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"d7e1c4c7-8704-4450-8d35-0547996417b5","block_type":"box","text":"NM1026U-6004382-598/605","page_number":598,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"0b164a0f-a5eb-4c19-94cc-0c23bcd2b3c9","block_type":"box","text":"Appendix 1: How we fulfil and oversee our investment stewardship responsibilities for","page_number":599,"box":{"x":116,"y":87,"width":695,"height":12}},{"id":"444dde97-f4cb-4f6d-989f-7085960c282a","block_type":"box","text":"non-index equity investment strategies","page_number":599,"box":{"x":117,"y":103,"width":316,"height":12}},{"id":"bdc896eb-c1fb-4db2-880b-52f97e17d3e7","block_type":"box","text":"Oversight","page_number":599,"box":{"x":116,"y":134,"width":83,"height":12}},{"id":"3e8d25fb-c433-4554-b5da-fa699459f2b7","block_type":"box","text":"The Global Head of BAIS has primary oversight of and responsibility for the team’s activities, including","page_number":599,"box":{"x":116,"y":165,"width":764,"height":12}},{"id":"814c7f07-b536-4d63-8b1f-e6a233f352df","block_type":"box","text":"voting in accordance with the BlackRock Active Investment Stewardship Global Engagement and","page_number":599,"box":{"x":116,"y":180,"width":726,"height":12}},{"id":"b511406c-0804-4b07-902d-4bc74a21f345","block_type":"box","text":"Voting Guidelines (the “Guidelines”), which require the application of professional judgment and","page_number":599,"box":{"x":116,"y":196,"width":714,"height":12}},{"id":"9fa2aa9e-ef9f-4365-9b77-72606804c80d","block_type":"box","text":"consideration of each company’s unique circumstances, as well as input from active investors. BAIS is","page_number":599,"box":{"x":116,"y":211,"width":765,"height":12}},{"id":"80b6e2ba-c6dc-4991-b6b1-7aa502d7ec0d","block_type":"box","text":"independent from BlackRock Investment Stewardship in our engagement and voting activities,","page_number":599,"box":{"x":117,"y":227,"width":704,"height":12}},{"id":"81cb7ca3-edc9-46c7-993c-38f72406dcfe","block_type":"box","text":"reporting lines, and oversight.","page_number":599,"box":{"x":117,"y":242,"width":224,"height":12}},{"id":"1a8057c5-c33f-4ab6-813e-392ba5fe1c95","block_type":"box","text":"The Stewardship Leaders Group, comprised of senior active investors and other relevant stakeholders","page_number":599,"box":{"x":116,"y":273,"width":765,"height":12}},{"id":"08507af7-00db-43fb-bad8-e34277fa1c1c","block_type":"box","text":"in BlackRock’s legal, public policy, sustainability and communications teams, helps shape the firm’s","page_number":599,"box":{"x":117,"y":289,"width":742,"height":12}},{"id":"fafe5233-f2f8-42b6-9099-00f4182f7541","block_type":"box","text":"approach to investment stewardship on non-index equity investment strategies. The Group may advise","page_number":599,"box":{"x":116,"y":304,"width":769,"height":12}},{"id":"f1f7eb5f-24c0-44f7-888b-adf9afd2403f","block_type":"box","text":"on and review amendments to BAIS’ policies and practices. It does not determine voting decisions,","page_number":599,"box":{"x":116,"y":320,"width":739,"height":12}},{"id":"c0f396c5-d7c6-4680-b446-e0b9c35b0ee1","block_type":"box","text":"which are the responsibility of BAIS and the relevant active equity investors.","page_number":599,"box":{"x":116,"y":335,"width":568,"height":12}},{"id":"e78cf128-3450-4dc6-83cd-d99429902a31","block_type":"box","text":"BAIS carries out engagement with companies in collaboration with active investment colleagues,","page_number":599,"box":{"x":117,"y":366,"width":721,"height":12}},{"id":"94e9827b-42ef-4f99-aef4-756d47ff51e8","block_type":"box","text":"executes proxy votes, and conducts vote operations (including maintaining records of votes cast) in a","page_number":599,"box":{"x":116,"y":382,"width":757,"height":12}},{"id":"f233f69c-7a0b-4712-8173-b74a6290d672","block_type":"box","text":"manner consistent with the Guidelines. BAIS also conducts research on corporate governance issues","page_number":599,"box":{"x":117,"y":397,"width":757,"height":12}},{"id":"7a6b65ca-49f2-483f-a19f-67a162daf653","block_type":"box","text":"and participates in industry discussions to contribute to and keep abreast of important developments in","page_number":599,"box":{"x":116,"y":413,"width":768,"height":12}},{"id":"d8cef2ac-d300-4c37-b3ef-032a62300cdf","block_type":"box","text":"the corporate governance field. BAIS may use third parties for certain of the foregoing activities and","page_number":599,"box":{"x":116,"y":428,"width":744,"height":12}},{"id":"29cf992a-5f5d-4909-bbe2-d785b914e92d","block_type":"box","text":"performs oversight of those third parties (see “Use and oversight of third-party vote services providers”","page_number":599,"box":{"x":117,"y":444,"width":765,"height":12}},{"id":"a5371bc4-924e-49c0-b67e-50afb99d5d09","block_type":"box","text":"below).","page_number":599,"box":{"x":117,"y":459,"width":58,"height":12}},{"id":"54a592bc-b91e-47b8-a2f8-6f10a037fc86","block_type":"box","text":"Voting guidelines and vote execution","page_number":599,"box":{"x":116,"y":490,"width":302,"height":12}},{"id":"abdc79d5-5c82-4f35-98df-8053350a2e1e","block_type":"box","text":"BlackRock votes on proxy issues when our clients authorize us to do so. We carefully consider the","page_number":599,"box":{"x":117,"y":521,"width":735,"height":12}},{"id":"c33f62ad-467f-4c6e-94e9-5a67e00c0167","block_type":"box","text":"voting items submitted to funds and other fiduciary account(s) (Fund or Funds) for which we have","page_number":599,"box":{"x":116,"y":537,"width":728,"height":12}},{"id":"0dc0bf07-dddb-4f0c-a0af-62b140e3beec","block_type":"box","text":"voting authority. BlackRock votes (or refrains from voting) for each Fund for which we have voting","page_number":599,"box":{"x":116,"y":552,"width":730,"height":12}},{"id":"3910fcf9-b9aa-48a9-b708-6d87503bd475","block_type":"box","text":"authority based on our evaluation of the alignment of the voting items with the long-term economic","page_number":599,"box":{"x":116,"y":568,"width":734,"height":12}},{"id":"b8c0a84d-26b9-46a5-b1b3-24da2b1b160c","block_type":"box","text":"interests of our clients, in the exercise of our independent business judgment, and without regard to the","page_number":599,"box":{"x":117,"y":583,"width":771,"height":12}},{"id":"2fbd67fa-26f9-4bfc-a655-a7d816f5e5a9","block_type":"box","text":"relationship of the issuer (or any shareholder proponent or dissident shareholder) to the Fund, the","page_number":599,"box":{"x":117,"y":599,"width":730,"height":12}},{"id":"b2cf2522-31ae-48fd-ad3d-ae1bae051c59","block_type":"box","text":"Fund’s affiliates (if any), BlackRock or BlackRock’s affiliates, or BlackRock employees (see “Conflicts","page_number":599,"box":{"x":117,"y":614,"width":754,"height":12}},{"id":"008aba1d-60fa-46d5-9c9f-0a2ec83c71db","block_type":"box","text":"management policies and procedures,” below).","page_number":599,"box":{"x":117,"y":630,"width":353,"height":12}},{"id":"a57d9521-eb38-445c-b375-dae3a8c491c6","block_type":"box","text":"When exercising voting rights, BAIS will normally vote on specific proxy issues in accordance with the","page_number":599,"box":{"x":116,"y":661,"width":754,"height":12}},{"id":"857655ca-06a7-4cfd-8d72-8bb6fbe0c7b5","block_type":"box","text":"Guidelines, although portfolio managers have the right to vote differently on their holdings if they","page_number":599,"box":{"x":117,"y":676,"width":713,"height":12}},{"id":"41b62154-a882-40f5-9a64-680a4c43a662","block_type":"box","text":"determine doing so is more aligned with the investment objective and financial interests of clients","page_number":599,"box":{"x":116,"y":692,"width":719,"height":12}},{"id":"39c640ec-2531-4375-aba9-8dd8f388d762","block_type":"box","text":"invested in the funds they manage.","page_number":599,"box":{"x":117,"y":707,"width":258,"height":12}},{"id":"be2b8685-f1e5-4e22-9ada-7bbbaf035877","block_type":"box","text":"The Guidelines are not intended to be exhaustive. BAIS applies the Guidelines on a case-by-case","page_number":599,"box":{"x":116,"y":738,"width":726,"height":12}},{"id":"c0f24658-f1d5-4fef-84e3-786bb7de69b8","block_type":"box","text":"basis, in the context of the individual circumstances of each company and the specific issue under","page_number":599,"box":{"x":117,"y":754,"width":728,"height":12}},{"id":"fe917f3d-a7b8-4a1b-a1b5-a6b5675b5bf4","block_type":"box","text":"review. As such, the Guidelines do not indicate how BAIS will vote in every instance. Rather, they","page_number":599,"box":{"x":117,"y":769,"width":723,"height":12}},{"id":"0e7930d8-36ad-4700-9626-e4ed53f98573","block_type":"box","text":"reflect our view about corporate governance issues generally, and provide insight into how we typically","page_number":599,"box":{"x":117,"y":785,"width":761,"height":12}},{"id":"95fa8d1a-a4f1-4613-b8a9-ee793bbfd04f","block_type":"box","text":"approach issues that are commonly put to a shareholder vote. The Guidelines are reviewed annually","page_number":599,"box":{"x":116,"y":800,"width":747,"height":12}},{"id":"b8871fa6-e232-40c5-a164-47a860d9a683","block_type":"box","text":"and updated as necessary to reflect changes in market practices, developments in corporate","page_number":599,"box":{"x":116,"y":816,"width":688,"height":12}},{"id":"fb164537-782b-4ed9-aaea-34cbe5498d13","block_type":"box","text":"governance and feedback from companies and clients. In this way, BAIS aims to maintain policies that","page_number":599,"box":{"x":116,"y":831,"width":765,"height":12}},{"id":"95899536-5917-4ce4-8b57-8424be7566e2","block_type":"box","text":"explain our approach to governance practices most aligned with clients’ long-term financial interests.","page_number":599,"box":{"x":116,"y":847,"width":751,"height":12}},{"id":"2d00ae42-9934-454f-a50d-b8dfa33e0714","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":599,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"0f7c0460-68b1-48e5-9516-3ee8ef039cd4","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":599,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"3aacd393-7e30-41fa-853a-69355d57a556","block_type":"box","text":"18","page_number":599,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"3304e3f5-90f8-4bf2-b63e-c7104e901b2b","block_type":"box","text":"NM1026U-6004382-599/605","page_number":599,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"bd6235ab-bb15-4ab6-b149-7f2dc04d22db","block_type":"box","text":"In certain markets, proxy voting involves logistical issues which can affect BAIS’ ability to vote such","page_number":600,"box":{"x":117,"y":87,"width":740,"height":12}},{"id":"e38a90fa-7165-4b3d-932a-b4e89f4e78ba","block_type":"box","text":"proxies, as well as the desirability of voting such proxies. These issues include, but are not limited to: i)","page_number":600,"box":{"x":117,"y":102,"width":768,"height":13}},{"id":"0a8713ef-85de-47b8-9b16-c8cd2ec82f21","block_type":"box","text":"untimely notice of shareholder meetings; ii) restrictions on a foreigner’s ability to exercise votes; iii)","page_number":600,"box":{"x":117,"y":118,"width":735,"height":12}},{"id":"e5868ab2-336a-4881-bacf-fb6568eaf448","block_type":"box","text":"requirements to vote proxies in person; iv) “share-blocking” (requirements that investors who exercise","page_number":600,"box":{"x":117,"y":134,"width":759,"height":12}},{"id":"846f82f3-768c-44b1-813f-5be3f1ad6a1c","block_type":"box","text":"their voting rights surrender the right to dispose of their holdings from the point at which votes are","page_number":600,"box":{"x":116,"y":149,"width":728,"height":12}},{"id":"6453082f-291e-4185-956e-155edf853338","block_type":"box","text":"submitted until after the after the shareholder meeting has occurred); v) potential difficulties in","page_number":600,"box":{"x":116,"y":165,"width":700,"height":12}},{"id":"80aee80b-fbd4-41b4-b234-e8c05f943493","block_type":"box","text":"translating the proxy; vi) regulatory constraints; and vii) requirements to provide local agents with","page_number":600,"box":{"x":116,"y":180,"width":723,"height":12}},{"id":"3a787fe2-8460-449e-8f50-4cef7a8db5e5","block_type":"box","text":"powers of attorney to facilitate voting instructions. We are not supportive of impediments to the","page_number":600,"box":{"x":117,"y":196,"width":706,"height":12}},{"id":"45dc93df-b28b-4817-9e98-92ff7efa4f64","block_type":"box","text":"exercise of voting rights such as share-blocking or overly burdensome administrative requirements.","page_number":600,"box":{"x":116,"y":211,"width":742,"height":12}},{"id":"48be9a4b-43aa-4e67-bd3b-6c10c559c74c","block_type":"box","text":"BlackRock votes proxies in these situations on a “best-efforts” basis. 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In","page_number":600,"box":{"x":116,"y":428,"width":716,"height":12}},{"id":"600ba2f5-2b2f-470e-a130-58316ab0021e","block_type":"box","text":"addition, institutional clients in separately managed accounts (SMAs) are eligible for BlackRock Voting","page_number":600,"box":{"x":116,"y":444,"width":764,"height":12}},{"id":"bd04b2c6-3cb3-4758-8eb9-58d8e3dcc27b","block_type":"box","text":"Choice regardless of their investment strategies.","page_number":600,"box":{"x":117,"y":459,"width":357,"height":12}},{"id":"ba37ea31-86c5-4c2d-8577-e04422ab2baa","block_type":"box","text":"12","page_number":600,"box":{"x":477,"y":459,"width":11,"height":6}},{"id":"fc369cd0-7803-4ce6-af5c-0d6fcd5d994f","block_type":"box","text":"As a result, the shares attributed to BlackRock in company share registers may be voted differently","page_number":600,"box":{"x":116,"y":490,"width":740,"height":12}},{"id":"7d5f0312-9927-45c0-ad5a-ef0d599f0066","block_type":"box","text":"depending on whether our clients have authorized BAIS to vote on their behalf, have authorized","page_number":600,"box":{"x":116,"y":506,"width":715,"height":12}},{"id":"0be1c99c-023f-4a12-be5f-6b13d9c739de","block_type":"box","text":"BlackRock to vote in accordance with a third-party policy, or have elected to vote shares in accordance","page_number":600,"box":{"x":117,"y":521,"width":769,"height":12}},{"id":"2f183888-c4fc-41f6-b530-4ae3ce6a3ebc","block_type":"box","text":"with their own policy. Our clients have greater control over proxy voting because of Voting Choice.","page_number":600,"box":{"x":116,"y":537,"width":727,"height":12}},{"id":"028b28f0-6082-48ed-a535-e77d360992f8","block_type":"box","text":"13","page_number":600,"box":{"x":846,"y":537,"width":10,"height":6}},{"id":"5a28e730-1091-447f-9017-9a4749d5639e","block_type":"box","text":"Use and oversight of third-party vote services providers","page_number":600,"box":{"x":117,"y":568,"width":452,"height":12}},{"id":"5913f867-cb5b-4812-85f2-c4e09d5f2e47","block_type":"box","text":"Third-party vote services providers — or proxy research firms — provide research and","page_number":600,"box":{"x":116,"y":599,"width":646,"height":12}},{"id":"fea399d6-72b8-4a03-a7a1-d1ef9a6d2227","block_type":"box","text":"recommendations on proxy votes, as well as voting infrastructure. BlackRock contracts primarily with","page_number":600,"box":{"x":117,"y":614,"width":752,"height":12}},{"id":"fb9daa2d-1137-413a-b468-54ba27fc92a4","block_type":"box","text":"the vote services provider ISS and leverages its online platform to supply research and support voting,","page_number":600,"box":{"x":116,"y":630,"width":765,"height":12}},{"id":"f784f3a2-d7c7-4995-87f1-df9f46dfb4cc","block_type":"box","text":"record keeping, and reporting processes. We also use Glass Lewis’ research and analysis as an input","page_number":600,"box":{"x":117,"y":645,"width":761,"height":12}},{"id":"6a890453-044d-46d9-abfc-698f43f847e2","block_type":"box","text":"into our voting process. It is important to note that, although proxy research firms provide important","page_number":600,"box":{"x":117,"y":661,"width":733,"height":12}},{"id":"85bcf5dc-b84b-4105-831e-567ceeb1f508","block_type":"box","text":"data and analysis, BAIS does not rely solely on their information or follow their voting","page_number":600,"box":{"x":116,"y":676,"width":629,"height":12}},{"id":"ff9d11e7-8d92-4dc7-9e1c-270ae29eec2a","block_type":"box","text":"recommendations. A company’s disclosures, our engagements and voting, investment colleagues’","page_number":600,"box":{"x":117,"y":692,"width":728,"height":12}},{"id":"5be32d15-8e7b-4808-b782-9708a946f958","block_type":"box","text":"insights and our Guidelines are important inputs into our voting decisions on behalf of clients.","page_number":600,"box":{"x":117,"y":707,"width":689,"height":12}},{"id":"dbc858b6-00a7-4007-9d4f-1a446f596eaa","block_type":"box","text":"Given the large universe of actively held companies, BAIS employs the proxy services provider to","page_number":600,"box":{"x":117,"y":738,"width":722,"height":12}},{"id":"c26b905f-39b9-4fa1-9586-acdf95748cec","block_type":"box","text":"streamline the voting process by making voting recommendations based on BAIS’ Guidelines when the","page_number":600,"box":{"x":116,"y":754,"width":765,"height":12}},{"id":"73a8b967-934a-47fb-8f6f-8477f2e30b3a","block_type":"box","text":"items on a shareholder meeting agenda are routine. Agenda items that are not routine are referred","page_number":600,"box":{"x":117,"y":769,"width":730,"height":12}},{"id":"5bf8fe04-48ad-4643-96b0-4fd51f486ad6","block_type":"box","text":"back to BAIS to assess, escalate as necessary to the relevant portfolio managers and vote. BAIS","page_number":600,"box":{"x":117,"y":785,"width":719,"height":12}},{"id":"9ef22e0d-ce3d-482c-8dff-1f7eebf54a80","block_type":"box","text":"reviews and can override the recommendations of the vote services provider at any time prior to the","page_number":600,"box":{"x":117,"y":800,"width":739,"height":12}},{"id":"2e23b5b4-2763-4890-866c-a44aca7e2c3a","block_type":"box","text":"12","page_number":600,"box":{"x":144,"y":841,"width":8,"height":5}},{"id":"882cceaf-32ea-4cb0-afa7-3e15ffe39905","block_type":"box","text":"With Voting Choice, SMAs have the ability to select from a set of voting policies from third-party proxy advisers the","page_number":600,"box":{"x":170,"y":841,"width":679,"height":9}},{"id":"82b40f80-9fda-44c9-9a31-c4f43b78add5","block_type":"box","text":"policy that best aligns with their views and preferences. BlackRock can then use its proxy voting infrastructure to cast","page_number":600,"box":{"x":170,"y":854,"width":695,"height":9}},{"id":"c537174b-379e-4277-8ef7-c10f3f934b75","block_type":"box","text":"votes based on the client’s selected voting policy.","page_number":600,"box":{"x":170,"y":867,"width":292,"height":9}},{"id":"884ede86-e9c3-45cb-9939-0f8aacb594a2","block_type":"box","text":"13","page_number":600,"box":{"x":144,"y":880,"width":8,"height":5}},{"id":"bcf52d26-5a9d-4cd9-893d-672da6d58077","block_type":"box","text":"BlackRock does not disclose client information, including a client’s selection of proxy policy, without client consent.","page_number":600,"box":{"x":171,"y":880,"width":678,"height":9}},{"id":"6902f97e-a2bc-4031-811e-3bddc732544f","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":600,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"0e0ae93f-aa5a-457f-84db-b42ca0b3f26e","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":600,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"e0613144-785b-4798-bcba-e4c22459dfe1","block_type":"box","text":"19","page_number":600,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"9c429601-f3fe-4314-bbd3-d98ef8d5a260","block_type":"box","text":"NM1026U-6004382-600/605","page_number":600,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"0159064d-4353-41d9-bb5c-f7cc80d43f40","block_type":"box","text":"vote deadline. Both BAIS and the vote services provider actively monitor securities filings, research","page_number":601,"box":{"x":116,"y":87,"width":741,"height":12}},{"id":"c2e34bbb-bcc8-40fc-90d9-213876f53864","block_type":"box","text":"reports, company announcements, and direct communications from companies to ensure awareness","page_number":601,"box":{"x":117,"y":102,"width":753,"height":13}},{"id":"dbb93e54-b3f3-4c56-a4f5-a22a3a3f552d","block_type":"box","text":"of supplemental disclosures and proxy materials that may require a modification of votes.","page_number":601,"box":{"x":116,"y":118,"width":667,"height":12}},{"id":"2f97e0a1-b86c-4c50-8d9d-560653dfb548","block_type":"box","text":"BAIS closely monitors the third-party vote services providers we contract with to ensure that they are","page_number":601,"box":{"x":117,"y":149,"width":751,"height":12}},{"id":"c0ea2b51-0184-4931-a29e-e5890e2bba58","block_type":"box","text":"meeting our service level expectations and have effective policies and procedures in place to manage","page_number":601,"box":{"x":117,"y":165,"width":759,"height":12}},{"id":"cda68a69-e1f4-4a54-8cd3-6bda9e96dc74","block_type":"box","text":"potential conflicts of interest. 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Such influence might stem from any relationship between the investee company (or any","page_number":601,"box":{"x":116,"y":289,"width":767,"height":12}},{"id":"be223c2b-4db1-4cf7-a842-9c35b206d2ef","block_type":"box","text":"shareholder proponent or dissident shareholder) and BlackRock, BlackRock’s affiliates, a Fund or a","page_number":601,"box":{"x":116,"y":304,"width":743,"height":12}},{"id":"9fc41ad1-0368-4cf2-89a1-63c07762c483","block_type":"box","text":"Fund’s affiliates, or BlackRock employees. 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In such circumstances, the independent third-party voting service provider","page_number":602,"box":{"x":184,"y":134,"width":669,"height":12}},{"id":"96205854-db1f-4fd0-af43-1ec82aa40aa2","block_type":"box","text":"provides BlackRock with recommendations, in accordance with the Guidelines, as to how to","page_number":602,"box":{"x":184,"y":149,"width":686,"height":12}},{"id":"41b32c9d-f2f5-4537-bddd-0a28ad2895ed","block_type":"box","text":"vote such proxies. BlackRock uses an independent third-party voting service provider to make","page_number":602,"box":{"x":183,"y":165,"width":704,"height":12}},{"id":"8052050a-9fc7-47bc-a00a-dc32c81ba0d2","block_type":"box","text":"proxy voting recommendations for shares of BlackRock, Inc. and companies affiliated with","page_number":602,"box":{"x":184,"y":180,"width":673,"height":12}},{"id":"fc00b7de-d649-4e7c-a8ad-6e367fd2d7b6","block_type":"box","text":"BlackRock, Inc. BlackRock may also use an independent third-party voting service provider to","page_number":602,"box":{"x":184,"y":196,"width":701,"height":12}},{"id":"87c1d1a9-5e3d-46dc-a4b9-41c96afcab34","block_type":"box","text":"make proxy voting recommendations for certain perceived or potential conflicts of interest,","page_number":602,"box":{"x":184,"y":211,"width":673,"height":12}},{"id":"b427b047-3642-4a4d-8abc-b4a9b099e7a3","block_type":"box","text":"including:","page_number":602,"box":{"x":184,"y":227,"width":75,"height":12}},{"id":"83429d0c-af1c-48e6-86d6-d5a891f34045","block_type":"box","text":"• public companies that include BlackRock employees on their boards of directors","page_number":602,"box":{"x":226,"y":250,"width":625,"height":12}},{"id":"ceb7cf87-8a5c-4510-a9cd-940134ae1685","block_type":"box","text":"• public companies of which a BlackRock, Inc. board member serves as a senior","page_number":602,"box":{"x":226,"y":273,"width":616,"height":12}},{"id":"113f1da7-1b31-4103-b568-7ba84c97dab1","block_type":"box","text":"executive or a member of the board of directors","page_number":602,"box":{"x":251,"y":289,"width":358,"height":9}},{"id":"a7c36ea8-6ca9-44c3-a767-c6856d3be499","block_type":"box","text":"• public companies that are the subject of certain transactions involving BlackRock","page_number":602,"box":{"x":226,"y":312,"width":631,"height":12}},{"id":"a387a0b7-6d80-407b-b535-4e65f950383f","block_type":"box","text":"Funds","page_number":602,"box":{"x":252,"y":327,"width":50,"height":10}},{"id":"cb0233db-f927-4485-9ba3-468b1aa911eb","block_type":"box","text":"• public companies that are joint venture partners with BlackRock, and","page_number":602,"box":{"x":226,"y":351,"width":540,"height":12}},{"id":"9a7b3665-061c-4c95-9fa9-0a98342f0e08","block_type":"box","text":"• public companies when legal or regulatory requirements compel BlackRock to use","page_number":602,"box":{"x":226,"y":374,"width":640,"height":12}},{"id":"954a53de-be60-4062-ba67-a984a4ebc571","block_type":"box","text":"an independent third-party voting service provider","page_number":602,"box":{"x":251,"y":389,"width":374,"height":12}},{"id":"2f1353ed-3a7d-4c95-bff2-57ccfaea7d07","block_type":"box","text":"In selecting an independent third-party voting service provider, we assess several characteristics,","page_number":602,"box":{"x":117,"y":420,"width":727,"height":12}},{"id":"a96cddf8-0e8d-4dd3-adaa-a65e8b4540ba","block_type":"box","text":"including but not limited to: independence, an ability to analyze proxy issues and make","page_number":602,"box":{"x":117,"y":436,"width":647,"height":12}},{"id":"70f3ff10-602a-40d9-a44e-6dccbdd9fe83","block_type":"box","text":"recommendations in the economic interest of our clients in accordance with the Guidelines, reputation","page_number":602,"box":{"x":117,"y":451,"width":760,"height":12}},{"id":"4d3c47a1-7628-4e7e-b530-96f38d0dfd81","block_type":"box","text":"for reliability and integrity, and operational capacity to accurately deliver the assigned","page_number":602,"box":{"x":116,"y":467,"width":637,"height":12}},{"id":"4d66d247-ed15-48bd-b59b-c2612e0c3d4f","block_type":"box","text":"recommendations in a timely manner. We may engage more than one independent third-party voting","page_number":602,"box":{"x":117,"y":482,"width":752,"height":12}},{"id":"c8527d16-e2b4-43c1-9310-9fe21e119ac8","block_type":"box","text":"service provider, in part to mitigate potential or perceived conflicts of interest at a single voting service","page_number":602,"box":{"x":116,"y":498,"width":761,"height":12}},{"id":"ad92eb25-e3ca-4a7c-8c86-c26ad60f3ca4","block_type":"box","text":"provider.","page_number":602,"box":{"x":117,"y":514,"width":69,"height":11}},{"id":"ef0a9390-e271-413e-8b39-19ec8e876bf1","block_type":"box","text":"Securities lending","page_number":602,"box":{"x":116,"y":544,"width":149,"height":12}},{"id":"b37d1068-3399-4355-a158-129803871b68","block_type":"box","text":"If authorized, BlackRock acts as a securities lending agent on behalf of its clients. 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While","page_number":602,"box":{"x":116,"y":668,"width":762,"height":12}},{"id":"e3d82223-a45a-49c5-8804-b923e78161a5","block_type":"box","text":"this has occurred in a limited number of cases, the decision to recall securities on loan as part of","page_number":602,"box":{"x":116,"y":684,"width":716,"height":12}},{"id":"2cfca3a5-8709-4d17-9efa-87fd8a12dae5","block_type":"box","text":"BlackRock’s securities lending program in order to vote is based on an evaluation of various factors","page_number":602,"box":{"x":117,"y":699,"width":737,"height":13}},{"id":"afac4d30-3d29-4409-aea5-3b3e67bea420","block_type":"box","text":"that include, but are not limited to, assessing potential securities lending revenue alongside the","page_number":602,"box":{"x":116,"y":715,"width":704,"height":12}},{"id":"628af558-cb5b-4bb6-881f-e9fd4edc5574","block_type":"box","text":"potential long-term financial value to clients of voting those securities (based on the information","page_number":602,"box":{"x":117,"y":730,"width":705,"height":13}},{"id":"62f3e538-fa23-40b7-bb7e-35c989b518a2","block_type":"box","text":"available at the time of recall consideration). BAIS works with active portfolio managers, as well as","page_number":602,"box":{"x":116,"y":746,"width":730,"height":12}},{"id":"3aa8694a-e270-46cd-a534-992a7a6f4f5e","block_type":"box","text":"colleagues in the Securities Lending team, to evaluate the costs and benefits to clients of recalling","page_number":602,"box":{"x":116,"y":761,"width":727,"height":13}},{"id":"f6fd6d73-cebc-4673-8b17-176cd03c91b6","block_type":"box","text":"shares on loan.","page_number":602,"box":{"x":116,"y":777,"width":113,"height":9}},{"id":"7eeac60f-8141-4207-9119-0d5507c822d9","block_type":"box","text":"In almost all instances, BlackRock anticipates that the potential long-term financial value to clients of","page_number":602,"box":{"x":117,"y":808,"width":745,"height":12}},{"id":"cc00ba18-38df-4333-8f5d-6e29cbd2ba03","block_type":"box","text":"voting shares would not warrant recalling securities on loan. However, in certain instances, BlackRock","page_number":602,"box":{"x":116,"y":824,"width":758,"height":12}},{"id":"177bf7d0-ea7a-4455-ae12-5009868f5621","block_type":"box","text":"may determine, in our independent business judgment as a fiduciary, that the value of voting","page_number":602,"box":{"x":117,"y":839,"width":691,"height":12}},{"id":"033419b8-8436-4a34-94ef-224526d20c7e","block_type":"box","text":"outweighs the securities lending revenue loss to clients and would therefore recall shares to be voted","page_number":602,"box":{"x":116,"y":854,"width":756,"height":13}},{"id":"273469ac-8deb-4cf4-8344-449a7162ba5c","block_type":"box","text":"in those instances.","page_number":602,"box":{"x":117,"y":870,"width":143,"height":9}},{"id":"fb58c930-7e4e-40f6-aa1f-a9cf47236519","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":602,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"bc5c0282-00d1-4247-88bc-e3d974f2dda7","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":602,"box":{"x":534,"y":909,"width":324,"height":12}},{"id":"a88d9f81-0bad-43fd-bd58-c965ed5b4ce5","block_type":"box","text":"21","page_number":602,"box":{"x":865,"y":909,"width":16,"height":9}},{"id":"1be79d74-fb1f-4825-a17b-7b50499f34c6","block_type":"box","text":"NM1026U-6004382-602/605","page_number":602,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"678577be-3931-4d5c-a117-264f6dfe92ed","block_type":"box","text":"Periodically, BlackRock reviews our process for determining whether to recall securities on loan in","page_number":603,"box":{"x":117,"y":87,"width":731,"height":12}},{"id":"240d6cde-5e0d-4c1c-be13-962f6697d173","block_type":"box","text":"order to vote and may modify it as necessary.","page_number":603,"box":{"x":116,"y":102,"width":344,"height":13}},{"id":"19730727-5c45-4cdd-be5e-4b5e8f3c894d","block_type":"box","text":"Reporting and vote transparency","page_number":603,"box":{"x":117,"y":134,"width":267,"height":12}},{"id":"e7f743e2-2439-4287-987a-a33e69616df0","block_type":"box","text":"BAIS is committed to transparency in the stewardship work we do on behalf of clients. 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