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I-1","page_number":16,"box":{"x":70,"y":108,"width":839,"height":11}},{"id":"e1a0dab0-5f0e-493d-97b7-5a41e55dcbbf","block_type":"box","text":"Investment Restrictions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-6","page_number":16,"box":{"x":70,"y":125,"width":839,"height":9}},{"id":"c5b0ee00-ef54-4eb2-a9be-72e2358e6012","block_type":"box","text":"Information on Trustees and Officers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 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B-1","page_number":16,"box":{"x":374,"y":500,"width":535,"height":9}},{"id":"dff8cc00-f67b-4ab5-b529-0bdcc9e69d9b","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":16,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"020ffc7a-f628-43f3-9aa6-86426f7d8b3b","block_type":"box","text":"PART I: INFORMATION ABOUT BLACKROCK REAL ESTATE SECURITIES FUND","page_number":17,"box":{"x":210,"y":45,"width":559,"height":9}},{"id":"9f978d6f-5b71-4dca-9981-ae7ee1a7a04e","block_type":"box","text":"Par t I of this Statement of Additional Information (“SAI”) sets for th information about BlackRock Real Estate","page_number":17,"box":{"x":102,"y":67,"width":771,"height":11}},{"id":"00c026e9-3660-4325-8888-febf7acd2349","block_type":"box","text":"Securities Fund (the “Fund”), a series of BlackRock Funds","page_number":17,"box":{"x":69,"y":82,"width":412,"height":11}},{"id":"4162c2e4-d5d9-46c6-943e-2ef288d8b49a","block_type":"box","text":"SM","page_number":17,"box":{"x":482,"y":83,"width":11,"height":4}},{"id":"f5d7ad27-4582-4a6b-99d1-5996a3691cff","block_type":"box","text":"(the “Trust”). It includes information about the Trust’s","page_number":17,"box":{"x":499,"y":82,"width":384,"height":11}},{"id":"2c318ad4-31c6-4730-99e1-7177f1e32c46","block_type":"box","text":"Board of Trustees (the “Board”), the advisory and management services provided to and the management fees paid","page_number":17,"box":{"x":70,"y":98,"width":827,"height":11}},{"id":"abfcf4b3-a1bf-4718-a597-14dc9ce1f747","block_type":"box","text":"by the Fund and information about other fees applicable to and services provided to the Fund. 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BlackRock, the adviser of the Fund, has filed","page_number":22,"box":{"x":68,"y":75,"width":837,"height":11}},{"id":"8706743c-48b0-4458-b38a-01954db2d6a9","block_type":"box","text":"a claim with the CFTC for the Fund to rely on this no-action relief. Accordingly, BlackRock is not subject to registration","page_number":22,"box":{"x":69,"y":90,"width":833,"height":11}},{"id":"f991564b-84aa-4135-8b22-051263421888","block_type":"box","text":"or regulation as a “commodity pool operator” under the Commodity Exchange Act in respect of the Fund.","page_number":22,"box":{"x":69,"y":105,"width":743,"height":11}},{"id":"b1440969-8dd2-4082-bc4c-cf81bae7e828","block_type":"box","text":"II. Investment Restrictions","page_number":22,"box":{"x":69,"y":135,"width":194,"height":9}},{"id":"4e30a9e8-68ae-499e-81b8-9896d15849f6","block_type":"box","text":"The Fund has adopted restrictions and policies relating to the investment of the Fund’s assets and its activities.","page_number":22,"box":{"x":101,"y":158,"width":800,"height":11}},{"id":"a141c65d-acdc-447b-bbb2-fcdda416618a","block_type":"box","text":"Cer tain of the restrictions are fundamental policies of the Fund and may not be changed without the approval of the","page_number":22,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"8a0ce73c-bd87-4149-8220-6dd15c5fb695","block_type":"box","text":"holders of a majority of the Fund’s outstanding voting securities (which for this purpose and under the Investment","page_number":22,"box":{"x":69,"y":188,"width":809,"height":12}},{"id":"adbc19cd-5aac-4372-be73-ada22409bd2c","block_type":"box","text":"Company Act means the lesser of (i) 67% of the shares represented at a meeting at which more than 50% of the","page_number":22,"box":{"x":69,"y":203,"width":803,"height":12}},{"id":"7bda56a0-bb05-40a8-a060-92ad344e75ea","block_type":"box","text":"outstanding shares are represented or (ii) more than 50% of the outstanding shares).","page_number":22,"box":{"x":69,"y":218,"width":608,"height":12}},{"id":"15dc73cf-6421-47c3-86d6-0fb3c0bc9254","block_type":"box","text":"Under these fundamental investment restrictions, the Fund may not:","page_number":22,"box":{"x":102,"y":241,"width":485,"height":11}},{"id":"6c956c6f-484f-4617-990c-1702306bb03c","block_type":"box","text":"1. Concentrate its investments in a par ticular industry, as that term is used in the Investment Company Act,","page_number":22,"box":{"x":135,"y":264,"width":770,"height":11}},{"id":"7c4063e6-1bf7-4cb1-b573-4f8390aed854","block_type":"box","text":"except that the Fund will concentrate its investments in companies in the real estate industry, which may include","page_number":22,"box":{"x":101,"y":279,"width":805,"height":11}},{"id":"d992bd0c-fd3d-489d-8560-86cf4cb6a19b","block_type":"box","text":"REITs, REIT-like structures, or real estate operating companies whose businesses and services are related to","page_number":22,"box":{"x":102,"y":294,"width":779,"height":11}},{"id":"f9d35f92-dcf0-48e2-9f46-183c862d99f2","block_type":"box","text":"the real estate industry.","page_number":22,"box":{"x":101,"y":309,"width":170,"height":11}},{"id":"3decb265-f7ff-4565-9c18-9305504e9a3b","block_type":"box","text":"2. Borrow money, except as permitted under the Investment Company Act.","page_number":22,"box":{"x":134,"y":332,"width":529,"height":11}},{"id":"ed6fa8b6-f68b-4ac4-b558-dbd05cfbf210","block_type":"box","text":"3. Issue senior securities to the extent such issuance would violate applicable law.","page_number":22,"box":{"x":134,"y":355,"width":590,"height":11}},{"id":"cc62e42b-0b4a-47b1-a5fd-42a325c60eb1","block_type":"box","text":"4. Purchase, hold or deal in real estate, although the Fund may purchase and sell securities or other","page_number":22,"box":{"x":134,"y":377,"width":718,"height":12}},{"id":"e6920365-b6ab-4a03-b145-7d3d0a73ae1d","block_type":"box","text":"instruments that are secured by, or linked to, real estate or interests therein, securities of real estate","page_number":22,"box":{"x":102,"y":392,"width":725,"height":12}},{"id":"d5345951-7bda-4383-a528-47d740194e71","block_type":"box","text":"investment trusts and mor tgage-related securities and may hold and sell real estate acquired by the Fund as a","page_number":22,"box":{"x":102,"y":408,"width":789,"height":11}},{"id":"156d6608-c23f-4340-a92e-f22f432ee080","block_type":"box","text":"result of the ownership of securities or other instruments.","page_number":22,"box":{"x":102,"y":423,"width":411,"height":11}},{"id":"a1b1ecd9-b059-482f-befd-8e31aa9c8fd0","block_type":"box","text":"5. Underwrite securities issued by others, except to the extent that the sale of por tfolio securities by the","page_number":22,"box":{"x":134,"y":445,"width":746,"height":11}},{"id":"8b8d7035-8788-4b95-9aea-607d0b757791","block_type":"box","text":"Fund may be deemed to be an underwriting or as otherwise permitted by applicable law.","page_number":22,"box":{"x":102,"y":461,"width":627,"height":11}},{"id":"03e50393-d7e4-439a-87ad-139021254b8f","block_type":"box","text":"6. Purchase or sell commodities or commodity contracts, except as permitted by the Investment Company","page_number":22,"box":{"x":134,"y":483,"width":757,"height":11}},{"id":"513202cb-08e6-4112-949f-8b4b923eaa70","block_type":"box","text":"Act.","page_number":22,"box":{"x":101,"y":498,"width":25,"height":9}},{"id":"a9f3e94a-8cc7-44e0-a04d-e7521a38e779","block_type":"box","text":"7. Make loans to the extent prohibited by applicable law.","page_number":22,"box":{"x":135,"y":521,"width":401,"height":11}},{"id":"5fb656ce-d12b-414e-b524-2cd8794ca6bf","block_type":"box","text":"Notations Regarding the Fund’s Fundamental Investment Restrictions","page_number":22,"box":{"x":102,"y":544,"width":511,"height":11}},{"id":"e55d016d-bfdb-431f-8a47-12384063a4fa","block_type":"box","text":"The following notations are not considered to be par t of the Fund’s fundamental investment restrictions and are","page_number":22,"box":{"x":101,"y":566,"width":799,"height":11}},{"id":"c91304da-2646-4bdb-8ffe-db535fa65e73","block_type":"box","text":"subject to change without shareholder approval.","page_number":22,"box":{"x":69,"y":582,"width":341,"height":11}},{"id":"0b1ad368-58e4-4da5-a2ec-412fe7932b0d","block_type":"box","text":"With respect to the fundamental policy relating to concentration set for th in (1) above, the Investment Company","page_number":22,"box":{"x":101,"y":604,"width":796,"height":11}},{"id":"0067ec4d-b894-4e8b-ad0f-4fb796553c84","block_type":"box","text":"Act does not define what constitutes “concentration” in an industry. The Commission staff has taken the position","page_number":22,"box":{"x":68,"y":619,"width":811,"height":11}},{"id":"6de28557-c323-4b37-9a4c-1d0df00336bc","block_type":"box","text":"that investment of 25% or more of a fund’s total assets in one or more issuers conducting their principal activities in","page_number":22,"box":{"x":68,"y":634,"width":833,"height":12}},{"id":"2ac7104e-c88e-405e-b6a4-0ec8870fabc2","block_type":"box","text":"the same industry or group of industries constitutes concentration. It is possible that interpretations of concentration","page_number":22,"box":{"x":68,"y":649,"width":836,"height":12}},{"id":"f0c032fc-a671-423d-8048-c423962f074a","block_type":"box","text":"could change in the future. The policy in (1) above will be interpreted to refer to concentration as that term may be","page_number":22,"box":{"x":69,"y":664,"width":815,"height":12}},{"id":"338d9e3e-b7b8-4bce-9dcd-110528b1649c","block_type":"box","text":"interpreted from time to time. The policy also will be interpreted to permit investment without limit in the following:","page_number":22,"box":{"x":70,"y":680,"width":813,"height":11}},{"id":"203dbc20-d071-47a5-8872-ca61d2258c2a","block_type":"box","text":"securities of the U.S. Government and its agencies or instrumentalities; securities of state, territory, possession or","page_number":22,"box":{"x":69,"y":695,"width":823,"height":11}},{"id":"04769827-f0ad-4c8b-b349-f6858b459351","block_type":"box","text":"municipal governments and their authorities, agencies, instrumentalities or political subdivisions; securities of foreign","page_number":22,"box":{"x":69,"y":710,"width":839,"height":11}},{"id":"48bd4db1-26fa-4cbc-a58d-f0b3400e5365","block_type":"box","text":"governments; and repurchase agreements collateralized by any such obligations. Accordingly, issuers of the foregoing","page_number":22,"box":{"x":68,"y":725,"width":840,"height":11}},{"id":"46b0f37b-e7a7-4052-a057-56bf0c3819e2","block_type":"box","text":"securities will not be considered to be members of any industry. There also will be no limit on investment in issuers","page_number":22,"box":{"x":69,"y":740,"width":824,"height":11}},{"id":"5d5f859d-a84b-4580-b32a-c9aa7b79b523","block_type":"box","text":"domiciled in a single jurisdiction or country. With respect to the Fund’s industry classifications, the Fund currently","page_number":22,"box":{"x":69,"y":755,"width":810,"height":11}},{"id":"3ea57421-96a6-4f1e-80b4-32b7dd2bc5f0","block_type":"box","text":"utilizes any one or more of the industry sub-classifications used by one or more widely recognized market indexes or","page_number":22,"box":{"x":69,"y":770,"width":829,"height":12}},{"id":"da4a5e8d-0a7b-4138-81f1-4c358188e26d","block_type":"box","text":"rating group indexes, and/or as defined by Fund management. The policy also will be interpreted to give broad","page_number":22,"box":{"x":69,"y":785,"width":784,"height":12}},{"id":"7caeb5ab-7ca7-40fa-89a9-c0daeeea9dd7","block_type":"box","text":"authority to the Fund as to how to classify issuers within or among industries.","page_number":22,"box":{"x":69,"y":801,"width":552,"height":11}},{"id":"d861d5e5-8138-4235-a3eb-8d512c231a93","block_type":"box","text":"With respect to the fundamental policy relating to borrowing money set for th in (2) above, the Investment","page_number":22,"box":{"x":101,"y":823,"width":750,"height":12}},{"id":"81d83944-3cb8-44f1-946f-a364fe949434","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 from banks","page_number":22,"box":{"x":69,"y":838,"width":827,"height":11}},{"id":"379688d0-246e-4032-b5bb-135da4efd8aa","block_type":"box","text":"for any purpose, and to borrow up to 5% of the Fund’s total assets from banks or other lenders for temporary","page_number":22,"box":{"x":68,"y":853,"width":781,"height":12}},{"id":"f3d76cec-1816-418c-8777-5977faeba167","block_type":"box","text":"purposes. (The Fund’s total assets include the amounts being borrowed.) To limit the risks attendant to borrowing,","page_number":22,"box":{"x":70,"y":869,"width":815,"height":11}},{"id":"1040b078-ca70-41aa-aca8-30cb8484a389","block_type":"box","text":"the Investment Company Act requires the Fund to maintain at all times an “asset coverage” of at least 300% of the","page_number":22,"box":{"x":68,"y":884,"width":825,"height":11}},{"id":"6ea99611-05c1-431d-850b-c7b971465c39","block_type":"box","text":"amount of its borrowings. Asset coverage means the ratio that the value of the Fund’s total assets (including","page_number":22,"box":{"x":69,"y":899,"width":777,"height":11}},{"id":"72b88471-2c2f-4dc8-9c3a-d6906a7b1552","block_type":"box","text":"I-6","page_number":22,"box":{"x":481,"y":943,"width":17,"height":9}},{"id":"613777db-d915-4b71-b9cf-cb980e6db50a","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":22,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"403301e4-8d9c-49bb-aa39-1bb36f4451a4","block_type":"box","text":"amounts borrowed), minus liabilities other than borrowings, bears to the aggregate amount of all borrowings.","page_number":23,"box":{"x":69,"y":45,"width":776,"height":11}},{"id":"03c061f7-2d30-4a71-ad1b-749e1feb0a14","block_type":"box","text":"Borrowing money to increase por tfolio holdings is known as “leveraging.” Cer tain trading practices and investments,","page_number":23,"box":{"x":70,"y":60,"width":828,"height":11}},{"id":"8da15d8c-00ec-4d95-909d-01737ffde7cc","block_type":"box","text":"such as reverse repurchase agreements, may be considered to be borrowings or involve leverage and thus are","page_number":23,"box":{"x":69,"y":75,"width":788,"height":11}},{"id":"fe8612ee-14fd-4dbe-a8c7-55c15094dd77","block_type":"box","text":"subject to the Investment Company Act restrictions. In accordance with Rule 18f-4 under the Investment Company","page_number":23,"box":{"x":69,"y":90,"width":813,"height":11}},{"id":"83ae925c-2f18-43ef-a1f2-6d0700e0d670","block_type":"box","text":"Act, when the Fund engages in reverse repurchase agreements and similar financing transactions, the Fund may","page_number":23,"box":{"x":68,"y":105,"width":802,"height":11}},{"id":"77be0413-42ca-4a86-8553-118639d66b5f","block_type":"box","text":"either (i) maintain asset coverage of at least 300% with respect to such transactions and any other borrowings in the","page_number":23,"box":{"x":69,"y":120,"width":834,"height":12}},{"id":"aced82f4-cc4e-4c1f-ab77-0608f7a1a49c","block_type":"box","text":"aggregate, or (ii) treat such transactions as “derivatives transactions” and comply with Rule 18f-4 with respect to","page_number":23,"box":{"x":69,"y":135,"width":807,"height":12}},{"id":"1f8ba6d3-fc00-42b5-8c9e-b80cff04aff1","block_type":"box","text":"such transactions. Shor t-term credits necessary for the settlement of securities transactions and arrangements with","page_number":23,"box":{"x":69,"y":150,"width":831,"height":12}},{"id":"26e59ea6-37d1-45ee-a69b-6aa57313bf3f","block_type":"box","text":"respect to securities lending will not be considered to be borrowings under the policy. Practices and investments that","page_number":23,"box":{"x":69,"y":166,"width":835,"height":11}},{"id":"c05dba6d-a8e6-4f12-8ad2-cd89ac68b08b","block_type":"box","text":"may involve leverage but are not considered to be borrowings are not subject to the policy.","page_number":23,"box":{"x":69,"y":181,"width":643,"height":11}},{"id":"2088a2f4-230f-4cf9-b96b-18e47f0a8f33","block_type":"box","text":"With respect to the fundamental policy relating to underwriting set for th in (5) above, the Investment Company","page_number":23,"box":{"x":101,"y":203,"width":788,"height":12}},{"id":"da7a89e1-ea6b-4894-9a4e-2faa54800895","block_type":"box","text":"Act does not prohibit the Fund from engaging in the underwriting business or from underwriting the securities of other","page_number":23,"box":{"x":68,"y":218,"width":840,"height":12}},{"id":"d2a227e3-08c5-46b9-a1e8-5a052fac55ef","block_type":"box","text":"issuers; in fact, in the case of diversified funds, the Investment Company Act permits a fund to have underwriting","page_number":23,"box":{"x":70,"y":234,"width":808,"height":11}},{"id":"46568b18-92f1-40fe-acf1-f8a27178f6be","block_type":"box","text":"commitments of up to 25% of its assets under cer tain circumstances. Those circumstances currently are that the","page_number":23,"box":{"x":69,"y":249,"width":811,"height":11}},{"id":"8cdd9839-7516-46f9-bce7-044a5f2ae6e7","block_type":"box","text":"amount of the fund’s underwriting commitments, when added to the value of the fund’s investments in issuers where","page_number":23,"box":{"x":69,"y":264,"width":838,"height":11}},{"id":"9c4478c5-b349-4fd9-ad0b-e8627298bf4e","block_type":"box","text":"the fund owns more than 10% of the outstanding voting securities of those issuers, cannot exceed the 25% cap. A","page_number":23,"box":{"x":68,"y":279,"width":818,"height":11}},{"id":"32694177-8cfe-4452-8a12-917a41233cf0","block_type":"box","text":"fund engaging in transactions involving the acquisition or disposition of por tfolio securities may be considered to be","page_number":23,"box":{"x":68,"y":294,"width":826,"height":11}},{"id":"a4e49907-9e99-40bc-b722-135cc439946f","block_type":"box","text":"an underwriter under the Securities Act of 1933, as amended (the “Securities Act”). Although it is not believed that","page_number":23,"box":{"x":69,"y":309,"width":822,"height":11}},{"id":"c53d3780-e9bb-43a4-8493-aea7be089300","block_type":"box","text":"the application of the Securities Act provisions described above would cause a fund to be engaged in the business of","page_number":23,"box":{"x":68,"y":324,"width":838,"height":12}},{"id":"556279b1-6ed3-4e80-b7ba-247264689c33","block_type":"box","text":"underwriting, the policy in (5) above will be interpreted not to prevent a fund from engaging in transactions involving","page_number":23,"box":{"x":69,"y":339,"width":823,"height":12}},{"id":"fa08d322-add9-48e1-9275-e90eeda3ec92","block_type":"box","text":"the acquisition or disposition of por tfolio securities, regardless of whether the fund may be considered to be an","page_number":23,"box":{"x":68,"y":355,"width":796,"height":11}},{"id":"b5b631a8-3d55-4ab9-a57b-2eb2a3e0d3e0","block_type":"box","text":"underwriter under the Securities Act or is otherwise engaged in the underwriting business to the extent permitted by","page_number":23,"box":{"x":69,"y":370,"width":830,"height":11}},{"id":"efe8ee87-aa7d-4ba9-917e-941ca1fbc814","block_type":"box","text":"applicable law.","page_number":23,"box":{"x":69,"y":385,"width":102,"height":11}},{"id":"814c7f42-f35e-4a86-8580-d6672c9b3540","block_type":"box","text":"With respect to the fundamental policy relating to lending set for th in (7) above, the Investment Company Act","page_number":23,"box":{"x":101,"y":407,"width":778,"height":12}},{"id":"2e7e8ac6-042e-4784-86a9-858a132e214c","block_type":"box","text":"does not prohibit the Fund from making loans (including lending its securities); however, Commission staff","page_number":23,"box":{"x":69,"y":423,"width":759,"height":11}},{"id":"34a88290-64d5-419f-9e60-424509506167","block_type":"box","text":"interpretations currently prohibit funds from lending more than one-third of their total assets, except through the","page_number":23,"box":{"x":70,"y":438,"width":798,"height":11}},{"id":"c0a5478a-57df-4cf4-9412-a52673b59f39","block_type":"box","text":"purchase of debt obligations (including lending its securities) or the use of repurchase agreements. In addition,","page_number":23,"box":{"x":70,"y":453,"width":791,"height":11}},{"id":"60a5dc4a-a52c-4f06-a07b-dd94854514b2","block_type":"box","text":"collateral arrangements with respect to options, forward currency and futures transactions and other derivative","page_number":23,"box":{"x":69,"y":468,"width":791,"height":11}},{"id":"8037353c-55b0-48f3-949a-e8adc6c86c8c","block_type":"box","text":"instruments, as well as delays in the settlement of securities transactions, will not be considered loans.","page_number":23,"box":{"x":70,"y":483,"width":742,"height":11}},{"id":"4603d64e-0aaa-4c87-a319-cac7085b6bd8","block_type":"box","text":"Under its non-fundamental investment restrictions, the Fund may not:","page_number":23,"box":{"x":102,"y":506,"width":493,"height":11}},{"id":"500d013b-7b5b-42e0-a566-c4a27d537a08","block_type":"box","text":"a. Purchase securities of other investment companies, except to the extent permitted by the Investment","page_number":23,"box":{"x":134,"y":528,"width":742,"height":12}},{"id":"f482927f-f2a7-454d-9fd2-d0311a20b211","block_type":"box","text":"Company Act. As a matter of policy, however, the Fund will not purchase shares of any registered open-end","page_number":23,"box":{"x":102,"y":543,"width":759,"height":12}},{"id":"51c38d5b-2b86-4f9c-9fe7-ed0e74bda2fb","block_type":"box","text":"investment company or registered unit investment trust, in reliance on Section 12(d)(1)(F) or (G) (the “fund of","page_number":23,"box":{"x":102,"y":559,"width":779,"height":11}},{"id":"9df8ad58-1f85-4689-845f-5e950c3c738e","block_type":"box","text":"funds” provisions) of the Investment Company Act, at any time the Fund has knowledge that its shares are","page_number":23,"box":{"x":101,"y":574,"width":761,"height":11}},{"id":"36437756-9db7-48f3-8d90-99f8fa123688","block_type":"box","text":"purchased by another investment company investor in reliance on the provisions of subparagraph (G) of Section","page_number":23,"box":{"x":102,"y":589,"width":795,"height":11}},{"id":"374b8839-76f0-4338-a33d-f8187eec5a6d","block_type":"box","text":"12(d)(1).","page_number":23,"box":{"x":102,"y":604,"width":60,"height":11}},{"id":"3417eb36-5d17-4c56-9c3e-d840bcfb5488","block_type":"box","text":"b. Make shor t sales of securities or maintain a shor t position, except to the extent permitted by the Fund’s","page_number":23,"box":{"x":134,"y":627,"width":765,"height":11}},{"id":"c55c4852-1ff7-4667-8813-ddf0400fdad1","block_type":"box","text":"Prospectus and SAI, as amended from time to time, and applicable law.","page_number":23,"box":{"x":102,"y":642,"width":509,"height":11}},{"id":"dd46c2bc-e45f-4056-b50d-dac7c16df0f1","block_type":"box","text":"Unless otherwise indicated, all limitations under the Fund’s fundamental or non-fundamental investment","page_number":23,"box":{"x":102,"y":664,"width":744,"height":11}},{"id":"41705211-be85-4c7e-87d3-dc656b4f6be1","block_type":"box","text":"restrictions apply only at the time that a transaction is under taken. Any change in the percentage of the Fund’s","page_number":23,"box":{"x":69,"y":680,"width":791,"height":11}},{"id":"42c9c7bf-5dc5-4d6e-b38b-69ac7b1a6b63","block_type":"box","text":"assets invested in cer tain securities or other instruments resulting from market fluctuations or other changes in the","page_number":23,"box":{"x":69,"y":695,"width":827,"height":11}},{"id":"5f2701af-6206-4d9d-8a3b-db2a89339422","block_type":"box","text":"Fund’s total assets will not require the Fund to dispose of an investment until BlackRock determines that it is","page_number":23,"box":{"x":70,"y":710,"width":780,"height":11}},{"id":"5193dacf-2162-48ee-923a-087b2114c0bb","block_type":"box","text":"practicable to sell or close out the investment without undue market or tax consequences.","page_number":23,"box":{"x":70,"y":725,"width":642,"height":11}},{"id":"36dc6318-aa4c-4ca4-88e2-d46abc75b739","block_type":"box","text":"III. Information on Trustees and Officers","page_number":23,"box":{"x":69,"y":755,"width":290,"height":9}},{"id":"2a3b2960-e643-4250-9ada-104dcd57da08","block_type":"box","text":"The Board consists of thir teen individuals (each, a “Trustee”), eleven of whom are not “interested persons” of","page_number":23,"box":{"x":101,"y":778,"width":789,"height":11}},{"id":"c9cf66cf-9d95-4562-9544-233df45be4bc","block_type":"box","text":"the Trust as defined in the Investment Company Act (the “Independent Trustees”). The registered investment","page_number":23,"box":{"x":68,"y":793,"width":779,"height":11}},{"id":"068efea5-1b72-4ff1-8414-18f8eeb60653","block_type":"box","text":"companies advised by the Manager or its affiliates (the “BlackRock-advised Funds”) are organized into the BlackRock","page_number":23,"box":{"x":69,"y":808,"width":837,"height":11}},{"id":"59352bd1-bc78-4819-ad7f-bf3f9347a110","block_type":"box","text":"Multi-Asset Complex, the BlackRock Fixed-Income Complex, and the iShares Complex (each, a “BlackRock Fund","page_number":23,"box":{"x":70,"y":823,"width":793,"height":11}},{"id":"82d8f003-d165-4ee9-804f-f3a795162de4","block_type":"box","text":"Complex”). The Trust is included in the BlackRock Fund Complex referred to as the BlackRock Multi-Asset Complex.","page_number":23,"box":{"x":69,"y":838,"width":822,"height":11}},{"id":"ef0be763-128c-48ac-87fb-4ca4b65d6e16","block_type":"box","text":"The Trustees also oversee as board members the operations of the other open-end registered investment companies","page_number":23,"box":{"x":68,"y":853,"width":837,"height":12}},{"id":"b57b97fb-b87d-452b-9e79-5aec56b93cb7","block_type":"box","text":"included in the BlackRock Multi-Asset Complex.","page_number":23,"box":{"x":70,"y":869,"width":335,"height":11}},{"id":"dd40b43e-cb10-4959-a728-cd7191e5d4db","block_type":"box","text":"The Board has overall responsibility for the oversight of the Trust and the Fund. The Chair of the Board is an","page_number":23,"box":{"x":101,"y":891,"width":769,"height":12}},{"id":"303aaaf3-cad2-4dbb-9b4e-5ba94050a397","block_type":"box","text":"Independent Trustee, and the Chair of each Board committee (each, a “Committee”) is an Independent Trustee. The","page_number":23,"box":{"x":70,"y":906,"width":827,"height":11}},{"id":"df89274e-7c02-4bb8-98ad-2af8ce218226","block_type":"box","text":"I-7","page_number":23,"box":{"x":481,"y":943,"width":16,"height":9}},{"id":"0a558871-2dcc-40ee-9fab-6662c809130f","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":23,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"08a46405-43c4-4ed3-aa12-6ccd6f27034b","block_type":"box","text":"Board has five standing Committees: an Audit Committee, a Governance and Nominating Committee, a Compliance","page_number":24,"box":{"x":70,"y":45,"width":821,"height":11}},{"id":"7a4b7404-01d2-4b45-8bf4-822e6a68f60d","block_type":"box","text":"Committee, a Per formance Oversight Committee and an Ad Hoc Topics Committee. The role of the Chair of the Board","page_number":24,"box":{"x":69,"y":60,"width":835,"height":11}},{"id":"79613127-6aad-4751-a74a-90d4764cbdfd","block_type":"box","text":"is to preside at all meetings of the Board and to act as a liaison with service providers, officers, attorneys and other","page_number":24,"box":{"x":70,"y":75,"width":830,"height":11}},{"id":"bb9000b4-fbe6-4ef1-b402-69e19e132ea1","block_type":"box","text":"Trustees generally between meetings. The Chair of each Committee per forms a similar role with respect to the","page_number":24,"box":{"x":68,"y":90,"width":789,"height":11}},{"id":"6c532343-3959-417c-b163-642cdd9b36f9","block_type":"box","text":"Committee. The Chair of the Board or the Chair of a Committee may also per form such other functions as may be","page_number":24,"box":{"x":69,"y":105,"width":810,"height":11}},{"id":"9c6b2866-da91-4a2c-9f07-ecaa1997e7f6","block_type":"box","text":"delegated by the Board or the Committee from time to time. The Independent Trustees meet regularly outside the","page_number":24,"box":{"x":69,"y":120,"width":809,"height":12}},{"id":"2f88ccc5-e508-440d-957c-a7be3245b492","block_type":"box","text":"presence of Fund management, in executive session or with other service providers to the Fund. The Board has","page_number":24,"box":{"x":70,"y":135,"width":794,"height":12}},{"id":"3ab2bd3e-0807-44cb-afbf-73038e0f8e21","block_type":"box","text":"regular meetings five times a year, and may hold special meetings if required before its next regular meeting. Each","page_number":24,"box":{"x":69,"y":150,"width":816,"height":12}},{"id":"a9794cd6-ebab-462d-ad5c-4a72c3d0b821","block_type":"box","text":"Committee meets regularly to conduct the oversight functions delegated to that Committee by the Board and repor ts","page_number":24,"box":{"x":69,"y":166,"width":831,"height":11}},{"id":"0f10ecbc-8dac-4262-816c-8d58728d09e6","block_type":"box","text":"its findings to the Board. The Board and each standing Committee conduct annual assessments of their oversight","page_number":24,"box":{"x":70,"y":181,"width":811,"height":11}},{"id":"eb740ea9-af2a-49d4-8711-cf7aa091eb7c","block_type":"box","text":"function and structure. The Board has determined that the Board’s leadership structure is appropriate because it","page_number":24,"box":{"x":68,"y":196,"width":809,"height":11}},{"id":"1dd89a94-a680-453e-9894-b93c8e06199b","block_type":"box","text":"allows the Board to exercise independent judgment over management and to allocate areas of responsibility among","page_number":24,"box":{"x":69,"y":211,"width":825,"height":11}},{"id":"f0253893-afaa-41fe-a952-6da2dc18748a","block_type":"box","text":"Committees and the full Board to enhance effective oversight.","page_number":24,"box":{"x":69,"y":226,"width":441,"height":11}},{"id":"406640a4-30e8-4bf4-85d7-20c1cb3b83d4","block_type":"box","text":"The Board has engaged the Manager to manage the Fund on a day-to-day basis. The Board is responsible for","page_number":24,"box":{"x":101,"y":249,"width":777,"height":11}},{"id":"2e4e9cd7-532a-4951-ba18-4474864a5b95","block_type":"box","text":"overseeing the Manager, other service providers, the operations of the Fund and associated risks in accordance with","page_number":24,"box":{"x":69,"y":264,"width":832,"height":11}},{"id":"bbcecc12-1ac6-47b0-94d3-e6b199212b9d","block_type":"box","text":"the provisions of the Investment Company Act, state law, other applicable laws, the Trust’s char ter, and the Fund’s","page_number":24,"box":{"x":68,"y":279,"width":820,"height":11}},{"id":"9229c6f2-8bce-41c2-b08f-1436d5c70a4f","block_type":"box","text":"investment objective and strategies. The Board reviews, on an ongoing basis, the Fund’s per formance, operations","page_number":24,"box":{"x":70,"y":294,"width":812,"height":11}},{"id":"226c1c3b-6304-489f-86e8-2416044c8e57","block_type":"box","text":"and investment strategies and techniques. The Board also conducts reviews of the Manager and its role in running","page_number":24,"box":{"x":69,"y":309,"width":819,"height":11}},{"id":"4be0f348-866b-4ca0-be06-1b062761b677","block_type":"box","text":"the operations of the Fund.","page_number":24,"box":{"x":68,"y":324,"width":192,"height":11}},{"id":"6e92fbb3-f289-4849-bae5-fe012b6b5f78","block_type":"box","text":"Day-to-day risk management with respect to the Fund is the responsibility of the Manager or of sub-advisers or","page_number":24,"box":{"x":102,"y":347,"width":785,"height":11}},{"id":"ae394ce6-0e1a-483d-9075-ac83fe20d244","block_type":"box","text":"other service providers (depending on the nature of the risk), subject to the supervision of the Manager. The Fund is","page_number":24,"box":{"x":69,"y":362,"width":828,"height":11}},{"id":"546fef07-4dc4-4bb7-b8f1-07939367516a","block_type":"box","text":"subject to a number of risks, including investment, compliance, operational and valuation risks, among others. While","page_number":24,"box":{"x":69,"y":377,"width":832,"height":12}},{"id":"523e1f18-8db1-4615-b9b3-9ebcc7f9a0e7","block_type":"box","text":"there are a number of risk management functions per formed by the Manager and the sub-advisers or other service","page_number":24,"box":{"x":68,"y":392,"width":820,"height":12}},{"id":"7466dd3d-8282-442a-bbc5-7ebd3f255e3a","block_type":"box","text":"providers, as applicable, it is not possible to eliminate all of the risks applicable to the Fund. Risk oversight forms","page_number":24,"box":{"x":70,"y":407,"width":811,"height":12}},{"id":"464e1d98-e5fc-46c8-be03-d4dba37c20ad","block_type":"box","text":"par t of the Board’s general oversight of the Fund and is addressed as par t of various Board and Committee","page_number":24,"box":{"x":70,"y":423,"width":767,"height":11}},{"id":"dd0b6c17-2c8d-4c1a-9481-8fc22130d877","block_type":"box","text":"activities. The Board, directly or through a Committee, also reviews repor ts from, among others, management, the","page_number":24,"box":{"x":69,"y":438,"width":815,"height":11}},{"id":"fb7263c7-041b-4861-a94f-152c7b32318d","block_type":"box","text":"independent registered public accounting firm for the Fund, sub-advisers and internal auditors for the investment","page_number":24,"box":{"x":70,"y":453,"width":803,"height":11}},{"id":"4c37b935-b618-4c7d-a6f4-373c5940ac26","block_type":"box","text":"adviser or its affiliates, as appropriate, regarding risks faced by the Fund and management’s or the service provider’s","page_number":24,"box":{"x":69,"y":468,"width":840,"height":11}},{"id":"f2678971-90e8-4db5-9320-b434f818cc6d","block_type":"box","text":"risk functions. The Committee system facilitates the timely and efficient consideration of matters by the Trustees,","page_number":24,"box":{"x":69,"y":483,"width":812,"height":11}},{"id":"ea6ede06-b29c-4c5c-9d08-cab51cfca808","block_type":"box","text":"and facilitates effective oversight of compliance with legal and regulatory requirements and of the Fund’s activities","page_number":24,"box":{"x":69,"y":498,"width":817,"height":11}},{"id":"e2b5f89b-0c78-4269-8021-91662b1bc175","block_type":"box","text":"and associated risks. The Board has appointed a Chief Compliance Officer, who oversees the implementation and","page_number":24,"box":{"x":69,"y":513,"width":812,"height":11}},{"id":"eba1fe98-5cf1-4737-8bd1-a21cdb9dc56f","block_type":"box","text":"testing of the Trust’s compliance program and repor ts to the Board regarding compliance matters for the Fund and","page_number":24,"box":{"x":68,"y":528,"width":818,"height":12}},{"id":"42589c01-dda5-466c-bdcc-70448f590b13","block_type":"box","text":"its service providers. The Independent Trustees have engaged independent legal counsel to assist them in","page_number":24,"box":{"x":70,"y":544,"width":759,"height":11}},{"id":"8e3a95b4-205a-41ec-9033-c34a043cf417","block_type":"box","text":"per forming their oversight responsibilities.","page_number":24,"box":{"x":70,"y":559,"width":299,"height":11}},{"id":"603c4614-1537-4987-8cf0-a869729c3625","block_type":"box","text":"Audit Committee.","page_number":24,"box":{"x":101,"y":581,"width":122,"height":9}},{"id":"2339ea26-bf08-4370-9c70-d2bfd5ba80ba","block_type":"box","text":"The members of the Audit Committee (the “Audit Committee”) are Henry R. Keizer (Chair), Neil","page_number":24,"box":{"x":229,"y":581,"width":673,"height":11}},{"id":"0abf708e-11ba-4fae-b55b-10a304267457","block_type":"box","text":"A. Cotty, Lori Richards, Kenneth L. Urish and Claire A. Walton, all of whom are Independent Trustees. The principal","page_number":24,"box":{"x":68,"y":596,"width":814,"height":12}},{"id":"a3828711-722c-4801-b635-2a2c4b0412c4","block_type":"box","text":"responsibilities of the Audit Committee are to approve, and recommend to the full Board for approval, the selection,","page_number":24,"box":{"x":69,"y":612,"width":826,"height":11}},{"id":"5905f25b-7acb-4580-b69a-1608d283862a","block_type":"box","text":"retention, termination and compensation of the Fund’s independent registered public accounting firm (the","page_number":24,"box":{"x":69,"y":627,"width":753,"height":11}},{"id":"68f13ba9-406d-40a9-837b-f90f58b4caaf","block_type":"box","text":"“Independent Registered Public Accounting Firm”) and to oversee the Independent Registered Public Accounting","page_number":24,"box":{"x":70,"y":642,"width":797,"height":11}},{"id":"a624ddf7-8351-44ee-966a-38c7bb6d94a4","block_type":"box","text":"Firm’s work. The Audit Committee’s responsibilities include, without limitation, to (1) evaluate the qualifications and","page_number":24,"box":{"x":70,"y":657,"width":825,"height":11}},{"id":"cec6321f-dd11-4e9d-9c8e-6ea0b2fb15af","block_type":"box","text":"independence of the Independent Registered Public Accounting Firm; (2) approve all audit engagement terms and","page_number":24,"box":{"x":70,"y":672,"width":807,"height":11}},{"id":"9bd50fd8-452b-4247-a3ca-b8ad17e305c7","block_type":"box","text":"fees for the Fund; (3) review the conduct and results of each independent audit of the Fund’s annual financial","page_number":24,"box":{"x":68,"y":687,"width":781,"height":11}},{"id":"6bf460e8-780c-4e53-a176-8c7638f7cfae","block_type":"box","text":"statements; (4) review any issues raised by the Independent Registered Public Accounting Firm or Fund management","page_number":24,"box":{"x":69,"y":703,"width":834,"height":11}},{"id":"f099a606-38b0-4699-9a98-81b8420f6e8b","block_type":"box","text":"regarding the accounting or financial repor ting policies and practices of the Fund and the internal controls of the Fund","page_number":24,"box":{"x":69,"y":717,"width":838,"height":12}},{"id":"2c19c713-67a0-49b8-8f55-d189d28c68a6","block_type":"box","text":"and cer tain service providers; (5) oversee the per formance of the Fund’s Independent Registered Public Accounting","page_number":24,"box":{"x":69,"y":732,"width":825,"height":12}},{"id":"25e44e65-0680-4849-928a-a6ef72c54976","block_type":"box","text":"Firm; (6) review and discuss with management and the Fund’s Independent Registered Public Accounting Firm the","page_number":24,"box":{"x":70,"y":748,"width":809,"height":11}},{"id":"65639a5a-66ac-4fa3-8be0-6578359d634d","block_type":"box","text":"per formance and findings of the Fund’s internal auditors; (7) discuss with Fund management its policies regarding","page_number":24,"box":{"x":70,"y":763,"width":815,"height":11}},{"id":"b3539075-11a0-4276-a1c0-39d8fccf4fb9","block_type":"box","text":"risk assessment and risk management as such matters relate to the Fund’s financial repor ting and controls;","page_number":24,"box":{"x":69,"y":778,"width":774,"height":11}},{"id":"ef6bf97a-36ae-4469-a6ee-5850c5c309d2","block_type":"box","text":"(8) resolve any disagreements between Fund management and the Independent Registered Public Accounting Firm","page_number":24,"box":{"x":69,"y":793,"width":815,"height":11}},{"id":"9976eb7b-2a55-46dd-8d66-81802028792c","block_type":"box","text":"regarding financial repor ting; and (9) under take such other duties and responsibilities as may from time to time be","page_number":24,"box":{"x":69,"y":808,"width":819,"height":11}},{"id":"cfd04ba5-b9e5-43f3-a857-e923de7dbffc","block_type":"box","text":"delegated by the Board to the Audit Committee. The Board has adopted a written char ter for the Audit Committee.","page_number":24,"box":{"x":69,"y":823,"width":812,"height":12}},{"id":"0703a039-13a2-4f3d-a20c-3cd1324b79ca","block_type":"box","text":"During the fiscal year ended January 31, 2026, the Audit Committee met four times.","page_number":24,"box":{"x":70,"y":838,"width":600,"height":12}},{"id":"153aa784-5786-4f7b-9e51-16d9bd845737","block_type":"box","text":"Governance and Nominating Committee.","page_number":24,"box":{"x":102,"y":861,"width":286,"height":11}},{"id":"176bdd8f-074c-4e34-9fa0-b733c8f3b47f","block_type":"box","text":"The members of the Governance and Nominating Committee (the","page_number":24,"box":{"x":394,"y":861,"width":464,"height":11}},{"id":"06c6911c-5c6c-4893-b7f3-8a82138fc5f1","block_type":"box","text":"“Governance Committee”) are Cynthia A. Montgomery (Chair), Christopher J. Ailman, Susan J. Car ter, Collette Chilton","page_number":24,"box":{"x":70,"y":876,"width":833,"height":11}},{"id":"6cca8588-ef00-4c7d-9e2e-6a9a3124b547","block_type":"box","text":"and Henry R. Keizer, all of whom are Independent Trustees. The principal responsibilities of the Governance","page_number":24,"box":{"x":69,"y":891,"width":769,"height":11}},{"id":"d46d808e-af1f-40a9-8f62-0f925756d3ab","block_type":"box","text":"Committee are to (1) identify individuals qualified to serve as Independent Trustees of the Trust and recommend","page_number":24,"box":{"x":69,"y":906,"width":802,"height":12}},{"id":"fabbe14e-0d72-4093-b85b-b8e6e8763392","block_type":"box","text":"I-8","page_number":24,"box":{"x":481,"y":943,"width":17,"height":9}},{"id":"fb3719aa-4033-48fb-b3ac-2903c85e96dc","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":24,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"75711bd4-72b1-4ef2-b9a3-fa36c3abba08","block_type":"box","text":"Independent Trustee nominees for election by shareholders or appointment by the Board; (2) advise the Board with","page_number":25,"box":{"x":70,"y":45,"width":819,"height":11}},{"id":"b3a1d1c2-71e1-40cc-a244-b209158ba583","block_type":"box","text":"respect to Board composition, procedures and committees (other than the Audit Committee); (3) oversee periodic","page_number":25,"box":{"x":69,"y":60,"width":810,"height":11}},{"id":"15b7fe49-a1eb-4dc5-a0ee-b63946d92acc","block_type":"box","text":"self-assessments of the Board and committees of the Board (other than the Audit Committee); (4) review and make","page_number":25,"box":{"x":69,"y":75,"width":824,"height":11}},{"id":"ff04512b-fb75-4718-ae60-410d30bef7be","block_type":"box","text":"recommendations regarding Independent Trustee compensation; (5) monitor corporate governance matters and","page_number":25,"box":{"x":69,"y":90,"width":793,"height":11}},{"id":"7a116fc5-d714-454f-9ed3-864302fe0f2a","block_type":"box","text":"develop appropriate recommendations to the Board; (6) act as the administrative committee with respect to Board","page_number":25,"box":{"x":69,"y":105,"width":815,"height":11}},{"id":"3f26b64e-c579-454f-ad9b-448717ee7dc2","block_type":"box","text":"policies and procedures, committee policies and procedures (other than the Audit Committee) and codes of ethics as","page_number":25,"box":{"x":70,"y":120,"width":835,"height":11}},{"id":"ef4633ce-16d7-412e-922f-f325e35a524c","block_type":"box","text":"they relate to Independent Trustees; and (7) under take such other duties and responsibilities as may from time to","page_number":25,"box":{"x":68,"y":135,"width":815,"height":11}},{"id":"9bfd388a-2135-413f-bde9-2e79a07b5b88","block_type":"box","text":"time be delegated by the Board to the Governance Committee. The Governance Committee may consider nominations","page_number":25,"box":{"x":68,"y":151,"width":841,"height":11}},{"id":"a74f4053-8e3a-4986-9d41-c2072d9be5ef","block_type":"box","text":"for Trustees made by the Fund’s shareholders as it deems appropriate. Under the Trust’s Amended and Restated","page_number":25,"box":{"x":68,"y":166,"width":809,"height":11}},{"id":"37539837-a19e-4264-8ac5-1d15b92dc691","block_type":"box","text":"Code of Regulations (“Bylaws”), shareholders must follow cer tain procedures to nominate a person for election as a","page_number":25,"box":{"x":69,"y":181,"width":829,"height":11}},{"id":"3b6ad222-bedb-4190-97be-9e675d589ec1","block_type":"box","text":"Trustee at a shareholder meeting at which Trustees are to be elected. Under these advance notice procedures,","page_number":25,"box":{"x":68,"y":196,"width":792,"height":11}},{"id":"047cc341-b137-406d-b78d-e9c54a8f0a8e","block_type":"box","text":"notice of the proposed nominee to the Secretary of the Trust must be delivered to or mailed and received at the","page_number":25,"box":{"x":69,"y":211,"width":798,"height":11}},{"id":"b78239f2-b656-4e4e-9a55-8c555636a7b7","block_type":"box","text":"principal executive offices of the Trust not later than the close of business on the fifth day following the day on which","page_number":25,"box":{"x":70,"y":226,"width":832,"height":11}},{"id":"1c111dd2-bcec-4b9b-9999-6b8f85a59ddc","block_type":"box","text":"notice of the date of the meeting was mailed or public disclosure of the date of the meeting was made, whichever","page_number":25,"box":{"x":69,"y":241,"width":812,"height":11}},{"id":"0c9a3190-ede5-4653-b572-a5352ac29fd1","block_type":"box","text":"first occurs. The Trust’s Bylaws provide that notice of a proposed nomination must include cer tain information about","page_number":25,"box":{"x":68,"y":256,"width":832,"height":11}},{"id":"27d24c32-9a63-45aa-8b09-77d24bff029d","block_type":"box","text":"the shareholder and the nominee, as well as cer tain other information, including a written consent of the proposed","page_number":25,"box":{"x":68,"y":271,"width":820,"height":12}},{"id":"90a055f9-32dc-457a-a599-2053f1368e5e","block_type":"box","text":"nominee to serve if elected. Reference is made to the Trust’s Bylaws for more details. The Board has adopted a","page_number":25,"box":{"x":69,"y":286,"width":801,"height":12}},{"id":"c9a6c2a5-6b4d-49ec-9b2f-3d81f305a3dd","block_type":"box","text":"written char ter for the Governance Committee. During the fiscal year ended January 31, 2026, the Governance","page_number":25,"box":{"x":68,"y":302,"width":791,"height":11}},{"id":"9b169c46-c369-42f5-8509-3baba8366d72","block_type":"box","text":"Committee met eleven times.","page_number":25,"box":{"x":69,"y":317,"width":208,"height":9}},{"id":"aba31f06-cf27-4338-9f28-a55758bf0fcc","block_type":"box","text":"Compliance Committee.","page_number":25,"box":{"x":102,"y":340,"width":168,"height":10}},{"id":"4d4bab4f-7d37-407e-b5ff-5ccd965d4e23","block_type":"box","text":"The members of the Compliance Committee (the “Compliance Committee”) are Claire A.","page_number":25,"box":{"x":276,"y":339,"width":629,"height":11}},{"id":"898d7fc1-7876-4045-96dd-9a66f9a98adf","block_type":"box","text":"Walton (Chair), Cynthia A. Montgomery, Donald C. Opatrny, Lori Richards and Kenneth L. Urish, all of whom are","page_number":25,"box":{"x":68,"y":355,"width":789,"height":11}},{"id":"773c2135-ac07-4032-8835-4f402bf20819","block_type":"box","text":"Independent Trustees. The Compliance Committee’s purpose is to assist the Board in fulfilling its responsibility to","page_number":25,"box":{"x":70,"y":370,"width":812,"height":11}},{"id":"d562bf12-421e-492e-83aa-b6603a2ce536","block_type":"box","text":"oversee regulatory and fiduciary compliance matters involving the Trust, the fund-related activities of BlackRock and","page_number":25,"box":{"x":69,"y":385,"width":826,"height":11}},{"id":"c2a33a4b-e287-4fda-b403-e67e8ea577fb","block_type":"box","text":"any sub-adviser and the Trust’s third-par ty service providers. The Compliance Committee’s responsibilities include,","page_number":25,"box":{"x":69,"y":400,"width":819,"height":11}},{"id":"5a87cb79-1f84-4b5c-b8ff-771b2ab578e7","block_type":"box","text":"without limitation, to (1) oversee the compliance policies and procedures of the Trust and its service providers and","page_number":25,"box":{"x":68,"y":415,"width":819,"height":11}},{"id":"3161fee0-dd42-4825-aa55-7a6bf6cbbca7","block_type":"box","text":"recommend changes or additions to such policies and procedures; (2) review information on and, where appropriate,","page_number":25,"box":{"x":69,"y":430,"width":832,"height":11}},{"id":"d39f8f3e-6c17-4f80-bf8d-993baa133ff1","block_type":"box","text":"recommend policies concerning the Trust’s compliance with applicable law; (3) review repor ts from, oversee the","page_number":25,"box":{"x":69,"y":445,"width":798,"height":12}},{"id":"ef2cef98-90ab-4c12-9d68-7a7bcec91755","block_type":"box","text":"annual per formance review of, and make cer tain recommendations and determinations regarding the Trust’s Chief","page_number":25,"box":{"x":69,"y":460,"width":818,"height":12}},{"id":"a26cef58-5903-44f4-b918-0253b7adcee9","block_type":"box","text":"Compliance Officer (the “CCO”), including determining the amount and structure of the CCO’s compensation and","page_number":25,"box":{"x":69,"y":475,"width":803,"height":12}},{"id":"f0be78ba-d28a-474e-9523-dca2ef14667e","block_type":"box","text":"recommending such amount and structure to the full Board for approval and ratification; and (4) under take such","page_number":25,"box":{"x":69,"y":491,"width":799,"height":11}},{"id":"d273b41a-30b2-4d01-9b5e-d496dc913550","block_type":"box","text":"other duties and responsibilities as may from time to time be delegated by the Board to the Compliance Committee.","page_number":25,"box":{"x":69,"y":506,"width":828,"height":11}},{"id":"41533098-8ca0-4b96-b78d-d45a57b63977","block_type":"box","text":"The Board has adopted a written char ter for the Compliance Committee. During the fiscal year ended","page_number":25,"box":{"x":68,"y":521,"width":720,"height":11}},{"id":"36ba3ae1-3e95-4a07-989d-0d051faa2f55","block_type":"box","text":"January 31, 2026, the Compliance Committee met four times.","page_number":25,"box":{"x":69,"y":536,"width":444,"height":11}},{"id":"0c365677-440c-4aac-b997-bd41dc97d027","block_type":"box","text":"Per formance Oversight Committee.","page_number":25,"box":{"x":102,"y":559,"width":248,"height":11}},{"id":"bfe2bb2c-2742-4e22-86b6-5a0e607f522d","block_type":"box","text":"The members of the Per formance Oversight Committee (the “Per formance","page_number":25,"box":{"x":356,"y":559,"width":531,"height":11}},{"id":"d20d3c10-7133-43f4-bdef-4e03d438759b","block_type":"box","text":"Oversight Committee”) are Donald C. Opatrny (Chair), Christopher J. Ailman, Susan J. Car ter, Collette Chilton and Neil","page_number":25,"box":{"x":69,"y":574,"width":837,"height":11}},{"id":"2175590d-00c7-4259-87a2-bd71b5c0cc38","block_type":"box","text":"A. Cotty, all of whom are Independent Trustees. The Per formance Oversight Committee’s purpose is to assist the","page_number":25,"box":{"x":68,"y":589,"width":808,"height":11}},{"id":"8470afca-864f-4d76-b596-48b2009eb5eb","block_type":"box","text":"Board in fulfilling its responsibility to oversee the Fund’s investment per formance relative to its agreed-upon","page_number":25,"box":{"x":70,"y":604,"width":769,"height":11}},{"id":"6d085c40-7ff6-45a1-9f32-8c4b76b1fe24","block_type":"box","text":"per formance objectives and to assist the Independent Trustees in their consideration of investment advisory","page_number":25,"box":{"x":70,"y":619,"width":775,"height":11}},{"id":"437d0ecc-a8a0-4dee-9d0d-cb96ca6c3105","block_type":"box","text":"agreements. The Per formance Oversight Committee’s responsibilities include, without limitation, to (1) review","page_number":25,"box":{"x":69,"y":634,"width":782,"height":12}},{"id":"52d5f997-8e99-447a-b116-656389d389aa","block_type":"box","text":"information on, and make recommendations to the full Board in respect of, the Fund’s investment objective, policies","page_number":25,"box":{"x":70,"y":649,"width":829,"height":11}},{"id":"799cd80e-8a4b-42e8-80b2-8dfd983eda92","block_type":"box","text":"and practices; (2) review information on the Fund’s investment per formance; (3) review information on appropriate","page_number":25,"box":{"x":69,"y":664,"width":816,"height":12}},{"id":"0e497eaf-e977-4527-bb3e-71a32a7b2b17","block_type":"box","text":"benchmarks and competitive universes and unusual or exceptional investment matters; (4) review personnel and","page_number":25,"box":{"x":69,"y":680,"width":803,"height":11}},{"id":"e11d6f76-5f82-40c1-ac56-c97a3fa3db4e","block_type":"box","text":"other resources devoted to management of the Fund and evaluate the nature and quality of information furnished to","page_number":25,"box":{"x":69,"y":695,"width":827,"height":11}},{"id":"673998c4-b3ce-47e9-a28e-841c855b0ada","block_type":"box","text":"the Per formance Oversight Committee; (5) recommend any required action regarding changes in fundamental and","page_number":25,"box":{"x":68,"y":710,"width":811,"height":11}},{"id":"4af1c27c-f26c-4c72-94bb-e328092148b0","block_type":"box","text":"non-fundamental investment policies and restrictions, fund mergers or liquidations; (6) request and review","page_number":25,"box":{"x":69,"y":725,"width":757,"height":11}},{"id":"ddb4a60e-6837-4edc-b827-e4aed9d6e8ec","block_type":"box","text":"information on the nature, extent and quality of services provided to the shareholders; (7) make recommendations to","page_number":25,"box":{"x":70,"y":740,"width":835,"height":11}},{"id":"e121e9c9-0115-45a7-ba45-377ba748b508","block_type":"box","text":"the Board concerning the approval or renewal of investment advisory agreements; and (8) under take such other","page_number":25,"box":{"x":68,"y":755,"width":800,"height":11}},{"id":"0687739f-909c-4883-9514-190af7a2008a","block_type":"box","text":"duties and responsibilities as may from time to time be delegated by the Board to the Per formance Oversight","page_number":25,"box":{"x":69,"y":770,"width":780,"height":12}},{"id":"39462936-eafd-43b1-ad46-a543e6991c64","block_type":"box","text":"Committee. The Board has adopted a written char ter for the Per formance Oversight Committee. During the fiscal year","page_number":25,"box":{"x":69,"y":785,"width":838,"height":12}},{"id":"71c2f923-48ce-4ed5-b887-7fa7a22c63d2","block_type":"box","text":"ended January 31, 2026, the Per formance Oversight Committee met five times.","page_number":25,"box":{"x":69,"y":801,"width":570,"height":11}},{"id":"336aa0e3-b72f-4ef9-a805-14a99109a0f2","block_type":"box","text":"Ad Hoc Topics Committee.","page_number":25,"box":{"x":101,"y":823,"width":186,"height":11}},{"id":"a2abc6a9-cf30-400a-a1c3-1ecb687f3f01","block_type":"box","text":"The members of the Ad Hoc Topics Committee (the “Ad Hoc Topics Committee”) are","page_number":25,"box":{"x":293,"y":823,"width":598,"height":11}},{"id":"192af076-2c76-4a1c-b2a0-d183deb439d8","block_type":"box","text":"Mark Stalnecker (Chair) and Claire A. Walton, both of whom are Independent Trustees, and John M. Perlowski, who","page_number":25,"box":{"x":70,"y":838,"width":817,"height":11}},{"id":"d4c37875-8bdb-4ef5-8072-43a0ef3bc76e","block_type":"box","text":"serves as an interested Trustee. The principal responsibilities of the Ad Hoc Topics Committee are to (1) act on","page_number":25,"box":{"x":69,"y":853,"width":795,"height":11}},{"id":"bfc73b87-eab2-421d-b072-f99c8d664c7b","block_type":"box","text":"routine matters between meetings of the Board; (2) act on such matters as may require urgent action between","page_number":25,"box":{"x":69,"y":869,"width":788,"height":11}},{"id":"e5dca194-d709-47ac-93bf-9f1ec05e06dd","block_type":"box","text":"meetings of the Board; and (3) exercise such other authority as may from time to time be delegated to the Ad Hoc","page_number":25,"box":{"x":69,"y":884,"width":813,"height":11}},{"id":"0347b7eb-b2b6-4c16-870f-194ef2663003","block_type":"box","text":"I-9","page_number":25,"box":{"x":481,"y":943,"width":17,"height":9}},{"id":"777ad53d-109c-4825-96ce-59b5679a93b0","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":25,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"02824bb7-75fc-43e4-bb9b-a3a3b8c9adec","block_type":"box","text":"Topics Committee by the Board. The Board has adopted a written char ter for the Ad Hoc Topics Committee. During","page_number":26,"box":{"x":68,"y":45,"width":816,"height":11}},{"id":"9e91f939-bc47-414a-8a56-d02853563a4c","block_type":"box","text":"the fiscal year ended January 31, 2026, the Ad Hoc Topics Committee did not meet.","page_number":26,"box":{"x":68,"y":60,"width":601,"height":11}},{"id":"d8283e30-6603-48b6-b33a-f2b16443119d","block_type":"box","text":"The Governance Committee has adopted a statement of policy that describes the experience, qualifications,","page_number":26,"box":{"x":101,"y":82,"width":771,"height":12}},{"id":"580e8132-7776-4cc5-b37e-208a4fb9995f","block_type":"box","text":"skills and attributes that are necessary and desirable for potential Independent Trustee candidates (the “Statement","page_number":26,"box":{"x":69,"y":98,"width":827,"height":11}},{"id":"51cb52ac-29cb-4f43-8392-1664e40f36e8","block_type":"box","text":"of Policy”). The Board believes that each Independent Trustee satisfied, at the time he or she was initially elected or","page_number":26,"box":{"x":69,"y":113,"width":830,"height":11}},{"id":"eae1c55a-615d-4e48-a8be-8020f069d4dd","block_type":"box","text":"appointed a Trustee, and continues to satisfy, the standards contemplated by the Statement of Policy. Fur thermore,","page_number":26,"box":{"x":69,"y":128,"width":825,"height":11}},{"id":"60941f93-d8fe-4c50-8983-9506e069ab4b","block_type":"box","text":"in determining that a par ticular Independent Trustee was and continues to be qualified to serve as a Trustee, the","page_number":26,"box":{"x":70,"y":143,"width":807,"height":11}},{"id":"2feafa2b-f8e5-427f-ac79-909a8304d02d","block_type":"box","text":"Board has considered a variety of criteria, none of which, in isolation, was controlling. The Board believes that,","page_number":26,"box":{"x":70,"y":158,"width":787,"height":11}},{"id":"703979f2-d78f-44bb-949b-9e513003761d","block_type":"box","text":"collectively, the Independent Trustees have balanced and diverse experience, skills, attributes and qualifications,","page_number":26,"box":{"x":69,"y":173,"width":805,"height":11}},{"id":"afe6c59d-df3e-487b-8291-b8414875589c","block_type":"box","text":"which allow the Board to operate effectively in governing the Trust and protecting the interests of shareholders.","page_number":26,"box":{"x":68,"y":188,"width":794,"height":12}},{"id":"e7c6b3d2-b13f-48e1-9ab9-6a4dcfd46b2c","block_type":"box","text":"Among the attributes common to all Independent Trustees are their ability to review critically, evaluate, question and","page_number":26,"box":{"x":68,"y":204,"width":829,"height":11}},{"id":"8b03ef95-0e27-4868-be45-4b19cc3c14a3","block_type":"box","text":"discuss information provided to them, to interact effectively with the Fund’s investment adviser, sub-advisers, other","page_number":26,"box":{"x":69,"y":218,"width":823,"height":12}},{"id":"97cef19c-ee9f-479e-bd20-2b2610b3a20f","block_type":"box","text":"service providers, counsel and the Independent Registered Public Accounting Firm, and to exercise effective","page_number":26,"box":{"x":69,"y":234,"width":771,"height":11}},{"id":"4c1f829c-f034-4676-93d8-c471b6ff998a","block_type":"box","text":"business judgment in the per formance of their duties as Trustees.","page_number":26,"box":{"x":69,"y":249,"width":473,"height":11}},{"id":"adb3a8cc-7501-4066-bdf8-ab97418a360f","block_type":"box","text":"Each Trustee’s ability to per form his or her duties effectively is evidenced by his or her educational background","page_number":26,"box":{"x":102,"y":271,"width":792,"height":12}},{"id":"e32c6bb7-b520-4405-abb4-7617ac484462","block_type":"box","text":"or professional training; business, consulting, public service or academic positions; experience from service as a","page_number":26,"box":{"x":69,"y":286,"width":807,"height":12}},{"id":"f4dca2ca-1abb-4036-bf18-0b40c89d264c","block_type":"box","text":"board member of the Trust and the other funds in the BlackRock Fund Complexes (and any predecessor funds), other","page_number":26,"box":{"x":69,"y":302,"width":837,"height":11}},{"id":"79980332-cde1-46a2-ab90-d268a73c1cd0","block_type":"box","text":"investment funds, public companies, non-profit entities or other organizations; ongoing commitment to and","page_number":26,"box":{"x":70,"y":317,"width":759,"height":11}},{"id":"1c7c86bf-eea2-463e-b9f9-53dce65523d5","block_type":"box","text":"par ticipation in Board and Committee meetings, as well as his or her leadership of standing and","page_number":26,"box":{"x":70,"y":332,"width":685,"height":11}},{"id":"767aada1-f29a-46ad-a23d-91f64b79bb8a","block_type":"box","text":"ad hoc","page_number":26,"box":{"x":762,"y":332,"width":47,"height":9}},{"id":"cd7c8a6e-659d-43dc-a79c-db4a90e968f3","block_type":"box","text":"committees","page_number":26,"box":{"x":814,"y":332,"width":82,"height":9}},{"id":"48f9e11a-21b4-4160-b88e-f864a0ee73e9","block_type":"box","text":"throughout the years; or other relevant life experiences.","page_number":26,"box":{"x":68,"y":347,"width":395,"height":11}},{"id":"2c928a61-3655-4677-b9bd-94e2971b81b9","block_type":"box","text":"Trustees Elect","page_number":26,"box":{"x":103,"y":370,"width":101,"height":9}},{"id":"4ba4845f-c9ef-4485-bcff-c1c13234f6e9","block_type":"box","text":"Jeffrey Jarczyk and Marc D. Stern have been appointed as Trustees of the Trust effective July 1, 2026 (each, a","page_number":26,"box":{"x":101,"y":392,"width":791,"height":11}},{"id":"e6ec588c-267a-4f4e-865e-1d49de1d828d","block_type":"box","text":"“Trustee-Elect”). Each Trustee Elect is expected to qualify as an Independent Trustee at the time of his service. Each","page_number":26,"box":{"x":70,"y":407,"width":833,"height":12}},{"id":"800f01bf-f39e-44af-b91d-8fabd0d3a095","block_type":"box","text":"Trustee Elect has been retained as a consultant to the Independent Trustees to assist the Independent Trustees in","page_number":26,"box":{"x":68,"y":423,"width":822,"height":11}},{"id":"11b90128-5c58-464c-a33e-bb252e9a8b87","block_type":"box","text":"the per formance of their duties to the Trust and is expected to serve in that capacity until July 1, 2026.","page_number":26,"box":{"x":68,"y":438,"width":740,"height":11}},{"id":"adcf48ac-d74c-4f54-a7e0-53a655682a7a","block_type":"box","text":"The table below discusses some of the experiences, qualifications and skills of each of the Trustees that","page_number":26,"box":{"x":101,"y":460,"width":751,"height":11}},{"id":"15c55a6e-9e10-4ba7-ba18-29334a784828","block_type":"box","text":"suppor t the conclusion that each Trustee should serve on the Board.","page_number":26,"box":{"x":69,"y":476,"width":492,"height":10}},{"id":"688f69e7-575b-4bfa-b8be-a102fef41a4b","block_type":"box","text":"Trustees Experience, Qualifications and Skills","page_number":26,"box":{"x":68,"y":504,"width":409,"height":9}},{"id":"36c71ffe-c209-478c-b882-32630596e09d","block_type":"box","text":"Independent Trustees","page_number":26,"box":{"x":70,"y":520,"width":154,"height":11}},{"id":"f202ff56-c47e-4f8c-963f-60a191d7ca5c","block_type":"box","text":"Christopher J. Ailman Christopher Ailman has more than 30 years of experience in the financial services","page_number":26,"box":{"x":69,"y":535,"width":781,"height":11}},{"id":"33db859a-4572-4182-aa46-6b5bd70536b8","block_type":"box","text":"industry, including most recently serving as Chief Investment Officer of the California","page_number":26,"box":{"x":265,"y":550,"width":604,"height":12}},{"id":"606be985-8f8f-4145-97db-ce7367bfe188","block_type":"box","text":"State Teachers Retirement System (CalSTRS) from 2000 to June 2024 where he led its","page_number":26,"box":{"x":265,"y":566,"width":623,"height":11}},{"id":"f188c0bb-5b45-480f-853f-40481655889d","block_type":"box","text":"investment program. Mr. Ailman currently is a principal at Ailman Advisers. In addition, he","page_number":26,"box":{"x":265,"y":581,"width":637,"height":11}},{"id":"ec03c59f-a340-4d2e-8d8a-041a211aee91","block_type":"box","text":"has held various roles in the industry, including as member and chair of the asset owner","page_number":26,"box":{"x":265,"y":596,"width":631,"height":11}},{"id":"c78fa6cb-1166-4f8b-96ab-15716444c64d","block_type":"box","text":"committee of the Kroner Center for Financial Research, chairman of the Nor th American","page_number":26,"box":{"x":264,"y":611,"width":626,"height":10}},{"id":"6cfc3ff7-ec7b-410d-b00c-5d8598d74fe6","block_type":"box","text":"Chapter of the 300 Club of Global CIOs, and co-chair of the Milken Global Capital Markets","page_number":26,"box":{"x":265,"y":626,"width":639,"height":11}},{"id":"f1a59816-45b4-46e8-be65-48ee26532318","block_type":"box","text":"Advisory Council. These positions have provided Mr. Ailman with considerable investment","page_number":26,"box":{"x":264,"y":641,"width":637,"height":11}},{"id":"a11c188b-c7d4-4fc8-8cb9-cfffdc94c232","block_type":"box","text":"exper tise across asset classes and strategies, and insight and perspective on the","page_number":26,"box":{"x":265,"y":657,"width":586,"height":11}},{"id":"a2eba1cf-72b0-4500-aba2-34bc780f7e62","block_type":"box","text":"markets and the economy. In addition, Mr. Ailman serves as a member of the Governance","page_number":26,"box":{"x":265,"y":671,"width":640,"height":12}},{"id":"472a5819-0300-4197-91f1-4ecac1bd8abc","block_type":"box","text":"Committee and the Per formance Oversight Committee.","page_number":26,"box":{"x":265,"y":686,"width":389,"height":12}},{"id":"6f7ad7b3-9632-47f2-9ab9-c3bc474b4022","block_type":"box","text":"Susan J. Car ter Susan J. Car ter has over 35 years of experience in investment management. She has","page_number":26,"box":{"x":69,"y":709,"width":806,"height":11}},{"id":"c689b0a3-476b-431c-972e-618f01084084","block_type":"box","text":"served as President & Chief Executive Officer of Commonfund Capital, Inc. 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She currently serves as Member","page_number":26,"box":{"x":265,"y":860,"width":634,"height":12}},{"id":"2dc41926-3c0d-445d-a8f8-43cecf79dcb4","block_type":"box","text":"of the President’s Counsel for Commonfund. 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These positions have provided her with insight and","page_number":27,"box":{"x":265,"y":126,"width":595,"height":11}},{"id":"8a596952-0cfd-4c59-beea-94c02d5a5adf","block_type":"box","text":"perspective on the markets and the economy.","page_number":27,"box":{"x":265,"y":141,"width":323,"height":11}},{"id":"6ebb93ff-4de3-43ec-a101-d88140fe3168","block_type":"box","text":"Neil A. Cotty Neil A. Cotty has more than 30 years of experience in the financial services industry,","page_number":27,"box":{"x":70,"y":164,"width":798,"height":11}},{"id":"b91bf210-c5e6-4d8f-b206-bb33b6cdb9c3","block_type":"box","text":"including 19 years at Bank of America Corporation and its affiliates, where he served, at","page_number":27,"box":{"x":265,"y":179,"width":631,"height":11}},{"id":"c2a2e96d-931b-45af-901d-fa066c9a9f15","block_type":"box","text":"different times, as the Chief Financial Officer of various businesses including Investment","page_number":27,"box":{"x":265,"y":194,"width":633,"height":11}},{"id":"fd43112a-e942-4992-bb9d-75991cc44500","block_type":"box","text":"Banking, Global Markets, Wealth Management and Consumer and also served ten years","page_number":27,"box":{"x":265,"y":209,"width":628,"height":11}},{"id":"548f38ae-3669-4c70-af4c-96be9c1cded8","block_type":"box","text":"as the Chief Accounting Officer for Bank of America Corporation. Mr. Cotty has been","page_number":27,"box":{"x":265,"y":224,"width":596,"height":11}},{"id":"0c064216-8f3e-4dfb-9ea4-6b9f9c6f90ba","block_type":"box","text":"determined by the Audit Committee to be an audit committee financial exper t, as such","page_number":27,"box":{"x":265,"y":239,"width":616,"height":11}},{"id":"470b9c02-3a2a-4640-b73a-8ed79c0ceaa3","block_type":"box","text":"term is defined in the applicable Commission rules.","page_number":27,"box":{"x":264,"y":254,"width":368,"height":11}},{"id":"47136b23-43e1-417c-80d2-a41d6b65ce6c","block_type":"box","text":"Henry R. Keizer Henry R. Keizer brings over 40 years of executive, financial, operational, strategic and","page_number":27,"box":{"x":70,"y":277,"width":806,"height":11}},{"id":"0a8a5194-575a-4678-b2d4-7c0b70bf2ab3","block_type":"box","text":"global exper tise gained through his 35 year career at KPMG, a global professional","page_number":27,"box":{"x":264,"y":292,"width":584,"height":11}},{"id":"a1aa8256-8c7d-47a9-aa93-41c6529bad07","block_type":"box","text":"services organization and by his service as a director to both publicly and privately held","page_number":27,"box":{"x":265,"y":308,"width":622,"height":11}},{"id":"a6facf99-551f-41d2-8236-0abcb801600e","block_type":"box","text":"organizations. He has extensive experience with issues facing complex, global companies","page_number":27,"box":{"x":265,"y":322,"width":638,"height":12}},{"id":"61074c98-0419-40c8-82b5-cf953756daf7","block_type":"box","text":"and exper tise in financial repor ting, accounting, auditing, risk management, and","page_number":27,"box":{"x":265,"y":338,"width":570,"height":11}},{"id":"8f6b7630-ffd5-485d-a990-295455d4fca8","block_type":"box","text":"regulatory affairs for such companies. Mr. Keizer’s experience also includes service as an","page_number":27,"box":{"x":265,"y":353,"width":642,"height":11}},{"id":"98f641bf-6678-4df7-92a3-9b845e95cba2","block_type":"box","text":"audit committee chair to both publicly and privately held organizations across numerous","page_number":27,"box":{"x":265,"y":368,"width":626,"height":11}},{"id":"59bde9c6-78b7-4c3e-90a6-2130580cb961","block_type":"box","text":"industries including professional services, proper ty and casualty reinsurance, insurance,","page_number":27,"box":{"x":265,"y":383,"width":630,"height":11}},{"id":"f4be4f9a-ad74-4ab0-a311-8f2cdba3c63e","block_type":"box","text":"diversified financial services, banking, direct to consumer, business to business and","page_number":27,"box":{"x":265,"y":398,"width":602,"height":11}},{"id":"9541ae62-c403-4626-ab89-2b571381e52f","block_type":"box","text":"technology. Mr. Keizer is a cer tified public accountant and also served on the board of the","page_number":27,"box":{"x":264,"y":413,"width":643,"height":11}},{"id":"431c49bb-89d5-49fa-a867-dc2b14e56ede","block_type":"box","text":"American Institute of Cer tified Public Accountants. Mr. Keizer has been determined by the","page_number":27,"box":{"x":264,"y":428,"width":639,"height":11}},{"id":"f1161a42-4340-42d8-9186-44a872e203c3","block_type":"box","text":"Audit Committee to be an audit committee financial exper t, as such term is defined in the","page_number":27,"box":{"x":264,"y":443,"width":641,"height":11}},{"id":"8571b557-be82-4580-b8bf-d6bebf90685f","block_type":"box","text":"applicable Commission rules.","page_number":27,"box":{"x":265,"y":459,"width":208,"height":10}},{"id":"8c13a7aa-b393-48b6-a9fd-c249836f06f3","block_type":"box","text":"Cynthia A. Montgomery Cynthia A. Montgomery has served for over 20 years on the boards of registered","page_number":27,"box":{"x":69,"y":481,"width":769,"height":11}},{"id":"1a79c423-44ba-4419-9535-19db7c864884","block_type":"box","text":"investment companies, most recently as a member of the boards of cer tain BlackRock","page_number":27,"box":{"x":265,"y":496,"width":621,"height":11}},{"id":"93f3dec2-b805-4e18-a23a-a18d15fb3387","block_type":"box","text":"advised Funds and predecessor funds, including the legacy Merrill Lynch Investment","page_number":27,"box":{"x":265,"y":511,"width":599,"height":12}},{"id":"61869791-c304-4a6c-a73e-a24594a3e54f","block_type":"box","text":"Managers, L.P. (“MLIM”) funds. The Board benefits from Ms. Montgomery’s more than 20","page_number":27,"box":{"x":265,"y":526,"width":641,"height":12}},{"id":"0b2d4d74-f6fd-422a-b270-0cd3d3a801ab","block_type":"box","text":"years of academic experience as a professor at Harvard Business School where she","page_number":27,"box":{"x":264,"y":542,"width":602,"height":11}},{"id":"fcff1706-af2d-4aa3-9cb6-9c029f85c921","block_type":"box","text":"taught courses on corporate strategy and corporate governance. Ms. Montgomery also","page_number":27,"box":{"x":264,"y":557,"width":617,"height":11}},{"id":"a85f60a3-89a7-42a4-b5cd-68d88ef2242d","block_type":"box","text":"has business management and corporate governance experience through her service on","page_number":27,"box":{"x":265,"y":572,"width":629,"height":11}},{"id":"e87878cf-0e15-493d-938d-6a905a9aa258","block_type":"box","text":"the corporate boards of a variety of public companies. She has also authored numerous","page_number":27,"box":{"x":264,"y":587,"width":628,"height":11}},{"id":"1214d259-5ea7-48a0-b331-3f6db2af9231","block_type":"box","text":"ar ticles and books on these topics.","page_number":27,"box":{"x":265,"y":602,"width":251,"height":11}},{"id":"953c47e5-05bf-4327-b079-d9c3ab3a29d4","block_type":"box","text":"Donald C. Opatrny Donald C. Opatrny has more than 40 years of business, oversight and executive","page_number":27,"box":{"x":70,"y":625,"width":764,"height":11}},{"id":"21e3d3c9-e4fb-41e1-a958-64cedb5975cd","block_type":"box","text":"experience, including through his service as president, director and investment committee","page_number":27,"box":{"x":265,"y":640,"width":642,"height":11}},{"id":"b4396aeb-ab63-4f28-9e32-ca620ec9f138","block_type":"box","text":"chair for academic and not-for-profit organizations, and his experience as a par tner,","page_number":27,"box":{"x":264,"y":655,"width":593,"height":11}},{"id":"5694c309-8da5-45c4-8956-4130bcd3c204","block_type":"box","text":"managing director and advisory director at Goldman Sachs for 32 years. He also has","page_number":27,"box":{"x":265,"y":670,"width":603,"height":11}},{"id":"3c69a5ea-df4a-419a-bab1-e6e353062d94","block_type":"box","text":"investment management experience as a board member of Athena Capital Advisors LLC.","page_number":27,"box":{"x":265,"y":685,"width":629,"height":12}},{"id":"af23f366-8ac5-4b44-b8de-21ccb0789ffe","block_type":"box","text":"I-11","page_number":27,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"b92ccf89-48f1-4147-b640-ca860f96e715","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":27,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"768e17d0-76de-432d-acda-6f9b83486159","block_type":"box","text":"Trustees Experience, Qualifications and Skills","page_number":28,"box":{"x":68,"y":49,"width":409,"height":9}},{"id":"dcfcefa3-6df7-4378-bd25-9770885d1d50","block_type":"box","text":"Lori Richards Lori Richards has more than 30 years of experience in the financial services industry,","page_number":28,"box":{"x":70,"y":65,"width":804,"height":12}},{"id":"a90052ec-c65f-40ca-bf6f-9bc0dd9d7b9e","block_type":"box","text":"most notably as the first Director of the Office of Compliance Inspections and","page_number":28,"box":{"x":265,"y":81,"width":552,"height":11}},{"id":"753ad898-ed54-4ad2-b319-83beb588c4c1","block_type":"box","text":"Examinations (“OCIE”) of the Securities and Exchange Commission (“SEC”) from 1995 to","page_number":28,"box":{"x":265,"y":96,"width":636,"height":11}},{"id":"805e5273-5e53-46a9-a51b-67abc42c4645","block_type":"box","text":"2009. During 14 years as the Director of OCIE, she led the SEC’s nationwide examination","page_number":28,"box":{"x":265,"y":111,"width":639,"height":11}},{"id":"03ac6437-c04b-4d1f-8831-772fa21d238c","block_type":"box","text":"oversight program for advisers, mutual funds, hedge funds, broker-dealers, stock","page_number":28,"box":{"x":265,"y":126,"width":576,"height":11}},{"id":"170bb23d-d7c6-444d-bb31-2be80a34bd2e","block_type":"box","text":"exchanges, and other industry firms. Prior to that, from 1985 to 1995, she held various","page_number":28,"box":{"x":265,"y":141,"width":626,"height":11}},{"id":"d9fef216-29fe-4e62-b83b-aa4afe8b474e","block_type":"box","text":"roles at the SEC, including Associate Director for Enforcement for the SEC’s Pacific","page_number":28,"box":{"x":265,"y":156,"width":592,"height":11}},{"id":"2fccc179-5661-423d-bebf-31cb7975e695","block_type":"box","text":"Regional Office and executive assistant and senior advisor to then SEC Chairman Ar thur","page_number":28,"box":{"x":265,"y":171,"width":629,"height":12}},{"id":"c4904cab-020a-4035-a72f-52aaac054c57","block_type":"box","text":"Levitt. More recently, Ms. Richards served as Chief Compliance Officer of the Asset and","page_number":28,"box":{"x":265,"y":186,"width":626,"height":12}},{"id":"c360a459-d765-4dd2-8046-25a356e48fa8","block_type":"box","text":"Wealth Management global lines of business at JPMorgan Chase & Co. from 2013 to","page_number":28,"box":{"x":264,"y":201,"width":608,"height":12}},{"id":"916af5d0-3f89-42d2-87a7-e3261adbdede","block_type":"box","text":"2018 where she led its global compliance program, advised business leaders on","page_number":28,"box":{"x":265,"y":217,"width":575,"height":11}},{"id":"2c01ef91-6c30-4707-b71d-b5669493ab5e","block_type":"box","text":"compliance issues, oversaw risk assessment, monitoring, testing and training, and","page_number":28,"box":{"x":264,"y":232,"width":591,"height":11}},{"id":"882ca619-faf6-4edd-8e8b-b5361784e670","block_type":"box","text":"maintained relationships with regulators. In addition, Ms. Richards served as a member","page_number":28,"box":{"x":265,"y":247,"width":627,"height":11}},{"id":"ff81617b-12e2-4307-94ac-f7f071f18c0b","block_type":"box","text":"of the National Adjudicatory Council of the Financial Industry Regulatory Authority","page_number":28,"box":{"x":265,"y":262,"width":578,"height":11}},{"id":"dbd61960-4b99-4ace-b17b-1471b84c7f12","block_type":"box","text":"(FINRA) from 2019 to 2022 and held the chair and vice chair posts during her tenure.","page_number":28,"box":{"x":265,"y":277,"width":607,"height":11}},{"id":"df4a1a1d-6f68-4f1e-a25e-ba8136f14682","block_type":"box","text":"Prior thereto, from 2010 to 2013, she was a Principal at PricewaterhouseCoopers LLP","page_number":28,"box":{"x":265,"y":292,"width":615,"height":11}},{"id":"abbf3ef4-93cf-4dee-87d3-a52203aac050","block_type":"box","text":"(“PwC”) and co-leader of its Asset Management Regulatory group. At PwC, she assisted a","page_number":28,"box":{"x":265,"y":307,"width":638,"height":12}},{"id":"14a2d085-f53d-4847-9bb3-ad4215b92e4c","block_type":"box","text":"broad range of financial services clients in designing and implementing risk management","page_number":28,"box":{"x":265,"y":322,"width":635,"height":12}},{"id":"df7bf270-0738-4aed-9be6-8d040dd3be06","block_type":"box","text":"and compliance programs, and preparing for new regulatory expectations. These positions","page_number":28,"box":{"x":265,"y":338,"width":642,"height":11}},{"id":"7e236243-ac63-438c-a739-363b9b756e27","block_type":"box","text":"have provided her with insight and perspective on the markets and the economy, as well","page_number":28,"box":{"x":265,"y":353,"width":627,"height":11}},{"id":"cedc5fc1-44e6-408e-ba22-02a051686730","block_type":"box","text":"as asset management regulation and compliance. In addition, Ms. Richards serves as a","page_number":28,"box":{"x":265,"y":368,"width":628,"height":11}},{"id":"e6f8c33a-154a-4fec-b52d-c4d330af6c25","block_type":"box","text":"member of the Audit Committee and the Compliance Committee.","page_number":28,"box":{"x":265,"y":383,"width":460,"height":11}},{"id":"992fe532-f37b-4136-8004-eb0c357447c3","block_type":"box","text":"Mark Stalnecker Mark Stalnecker has gained a wealth of experience in investing and asset management","page_number":28,"box":{"x":70,"y":406,"width":818,"height":11}},{"id":"97c11ed6-0667-491d-98f6-d73a47159403","block_type":"box","text":"from his over 13 years of service as the Chief Investment Officer of the University of","page_number":28,"box":{"x":264,"y":421,"width":603,"height":11}},{"id":"3828b391-65cc-47b2-b680-09d371be7bd9","block_type":"box","text":"Delaware as well as from his various positions with First Union Corporation, including","page_number":28,"box":{"x":265,"y":436,"width":606,"height":11}},{"id":"bb1b311a-94e2-4dc2-8e35-609f337374db","block_type":"box","text":"Senior Vice President and State Investment Director of First Investment Advisors. The","page_number":28,"box":{"x":265,"y":451,"width":608,"height":9}},{"id":"ed7266fe-14dd-43a0-9a12-11609d7f0a23","block_type":"box","text":"Board benefits from his experience and perspective as the Chief Investment Officer of a","page_number":28,"box":{"x":265,"y":466,"width":626,"height":11}},{"id":"93d8c1b4-8f2a-4a86-afdb-b90cbb604cae","block_type":"box","text":"university endowment and from the oversight experience he gained from service on","page_number":28,"box":{"x":265,"y":481,"width":591,"height":11}},{"id":"b2e55688-abe3-4d2b-8d73-e4d3dd199176","block_type":"box","text":"various private and non-profit boards.","page_number":28,"box":{"x":264,"y":496,"width":265,"height":11}},{"id":"9e9cbd85-ce62-4e91-aaff-d3361b4ed80d","block_type":"box","text":"Kenneth L. Urish Kenneth L. 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None Over","page_number":34,"box":{"x":197,"y":430,"width":634,"height":9}},{"id":"3fdf634b-c4ec-47d9-9d1b-b3591ea6851a","block_type":"box","text":"$100,000","page_number":34,"box":{"x":837,"y":429,"width":72,"height":11}},{"id":"c64cbaee-72a9-4777-9cc2-23aca23274fa","block_type":"box","text":"John M. Perlowski","page_number":34,"box":{"x":78,"y":445,"width":127,"height":9}},{"id":"9d7bb058-0fae-4287-b906-21fad7df353e","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . None Over","page_number":34,"box":{"x":213,"y":445,"width":618,"height":9}},{"id":"efba9004-95bf-4b55-b406-27418329d929","block_type":"box","text":"$100,000","page_number":34,"box":{"x":837,"y":444,"width":72,"height":11}},{"id":"4fb3e3e6-d6a4-4f30-b95c-ae6a92ca277d","block_type":"box","text":"As of May 5, 2026, the Trustees and officers of the Trust as a group directly or indirectly beneficially owned an","page_number":34,"box":{"x":101,"y":469,"width":790,"height":11}},{"id":"390ae4ca-955b-40a7-b257-c7fc58d02074","block_type":"box","text":"aggregate of less than 1% of any class of the outstanding shares of the Fund. As of December 31, 2025, none of the","page_number":34,"box":{"x":69,"y":484,"width":837,"height":11}},{"id":"916a08ef-b070-42f4-8a38-90fcd8d8caa9","block_type":"box","text":"Independent Trustees of the Trust or their immediate family members owned beneficially or of record any securities of","page_number":34,"box":{"x":70,"y":499,"width":840,"height":11}},{"id":"cdc0e55c-f25d-4736-858c-dd2119effc64","block_type":"box","text":"the Fund’s investment adviser, sub-advisers, principal underwriter, or any person directly or indirectly controlling,","page_number":34,"box":{"x":68,"y":514,"width":800,"height":11}},{"id":"ece690af-23df-4f1b-82dc-e2b1847948a4","block_type":"box","text":"controlled by, or under common control with such entities.","page_number":34,"box":{"x":69,"y":529,"width":412,"height":11}},{"id":"ffea2188-a6ce-4725-a4c9-b1deb3638c0d","block_type":"box","text":"Compensation of Trustees","page_number":34,"box":{"x":69,"y":559,"width":190,"height":11}},{"id":"ad8a94f4-31b9-4832-a422-ebacbfc1503b","block_type":"box","text":"Each Trustee who is an Independent Trustee is paid as compensation an annual retainer of $375,000 per year","page_number":34,"box":{"x":102,"y":581,"width":791,"height":12}},{"id":"11b59b3c-79c1-4ccd-8add-9db9ae617485","block_type":"box","text":"for his or her services as a board member of the BlackRock-advised Funds in the BlackRock Multi-Asset Complex,","page_number":34,"box":{"x":68,"y":597,"width":810,"height":11}},{"id":"8712dbcb-fb82-4cd8-a107-36b76c54823d","block_type":"box","text":"including the Trust, and a $20,000 board meeting fee to be paid for each in-person board meeting attended (and may","page_number":34,"box":{"x":70,"y":612,"width":838,"height":11}},{"id":"6aba5d09-a090-4531-9224-2d18ffb8ba3b","block_type":"box","text":"receive a board meeting fee for telephonic attendance at board meetings), for up to five board meetings held in a","page_number":34,"box":{"x":69,"y":627,"width":807,"height":12}},{"id":"ea90292a-a0fe-40cf-9388-09ac284d0684","block_type":"box","text":"calendar year (compensation for meetings in excess of this number to be determined on a case-by-case basis),","page_number":34,"box":{"x":69,"y":642,"width":791,"height":12}},{"id":"58990dd0-2746-4b6e-b35c-f50b09055938","block_type":"box","text":"together with out-of-pocket expenses in accordance with a board policy on travel and other business expenses","page_number":34,"box":{"x":68,"y":658,"width":786,"height":11}},{"id":"80d3a73b-f397-4f06-bd54-9b77dd4c0621","block_type":"box","text":"relating to attendance at meetings. The Chairs of the Audit Committee, Compliance Committee, Governance","page_number":34,"box":{"x":69,"y":673,"width":769,"height":11}},{"id":"67b59645-2808-4b77-9945-dfd4028eba63","block_type":"box","text":"Committee and Per formance Oversight Committee are paid as compensation an additional annual retainer of","page_number":34,"box":{"x":69,"y":688,"width":778,"height":11}},{"id":"b6bced3c-f8c1-4203-af73-65b52cc8248c","block_type":"box","text":"$45,000, respectively. The Chair of the Board is paid an additional annual retainer of $150,000.","page_number":34,"box":{"x":69,"y":702,"width":689,"height":12}},{"id":"ec5472aa-42f2-4dfd-9d51-c7e8d9642b7f","block_type":"box","text":"Each Trustee Elect currently serves as a consultant to the Independent Trustees in the per formance of the","page_number":34,"box":{"x":102,"y":726,"width":761,"height":11}},{"id":"d6727733-4bbf-428e-95cc-9a9140ca421b","block_type":"box","text":"Independent Trustees’ duties to the Trust and is paid compensation at the same rate as the compensation paid to","page_number":34,"box":{"x":70,"y":741,"width":816,"height":11}},{"id":"e9da8b00-8a97-498f-9204-2894c176de1e","block_type":"box","text":"any Independent Trustees who are not the Chair of the Board or a Chair of a Committee. 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Cotty. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 826 None","page_number":35,"box":{"x":79,"y":167,"width":654,"height":12}},{"id":"a29dd4e9-ce4a-4701-96f2-35dcfb86fc72","block_type":"box","text":"$467,500","page_number":35,"box":{"x":817,"y":167,"width":72,"height":11}},{"id":"e2dc3f43-fb95-48a9-8d4b-c61803157e3c","block_type":"box","text":"Henry R. 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Montgomery","page_number":35,"box":{"x":79,"y":198,"width":164,"height":11}},{"id":"61256c5f-a307-4fd3-9794-d90fe4069521","block_type":"box","text":"3","page_number":35,"box":{"x":244,"y":198,"width":4,"height":5}},{"id":"1b5f3112-9191-45ef-b2bc-6b41cf6e937a","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 841 None $490,000","page_number":35,"box":{"x":257,"y":197,"width":632,"height":11}},{"id":"5a64d71a-bbc2-4099-8901-e7c9d46c5cc2","block_type":"box","text":"Donald C. 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Urish . .","page_number":35,"box":{"x":79,"y":258,"width":131,"height":9}},{"id":"04085938-427a-431f-ab0a-b62581b280a4","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 818 None","page_number":35,"box":{"x":217,"y":258,"width":516,"height":10}},{"id":"32fbfd39-8af3-42e8-850d-7214aa60568c","block_type":"box","text":"$445,000","page_number":35,"box":{"x":817,"y":258,"width":72,"height":11}},{"id":"7b662661-d777-4625-96fa-d7cb0a8ab8c7","block_type":"box","text":"Claire A. 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None None None","page_number":35,"box":{"x":217,"y":304,"width":672,"height":9}},{"id":"819933ed-9286-4593-97c7-f9de24e98ceb","block_type":"box","text":"John M. Perlowski","page_number":35,"box":{"x":78,"y":319,"width":127,"height":9}},{"id":"bebe1357-69a6-40f3-814a-8b77c997034f","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . None None None","page_number":35,"box":{"x":208,"y":319,"width":681,"height":9}},{"id":"5c4c360d-a713-47b3-9d75-26403a8dc112","block_type":"box","text":"1","page_number":35,"box":{"x":69,"y":343,"width":3,"height":4}},{"id":"d6ba5e73-bbed-4ca5-8e97-a4a3938d326f","block_type":"box","text":"For the number of BlackRock-advised Funds from which each Trustee receives compensation, see “Biographical Information” beginning on\r\nI13","page_number":35,"box":{"x":94,"y":344,"width":786,"height":9}},{"id":"0592342a-8c68-48c9-84ce-52dac59df936","block_type":"box","text":"page I-13.","page_number":35,"box":{"x":94,"y":353,"width":55,"height":9}},{"id":"0a454c11-3ea3-46bc-9e8d-f4784452ee3e","block_type":"box","text":"2","page_number":35,"box":{"x":69,"y":366,"width":3,"height":3}},{"id":"0a01198d-0e80-4011-98e5-d54b75a2ebb9","block_type":"box","text":"Chair of the Audit Committee.","page_number":35,"box":{"x":93,"y":366,"width":168,"height":7}},{"id":"875da3c7-2002-4636-a915-eebcb109effe","block_type":"box","text":"3","page_number":35,"box":{"x":69,"y":379,"width":3,"height":3}},{"id":"06e0b5b7-c80d-4875-b3e3-5818d2f78db9","block_type":"box","text":"Chair of the Governance Committee.","page_number":35,"box":{"x":93,"y":378,"width":206,"height":8}},{"id":"d74d7790-d4ea-46e2-8e9e-58987dc12dc0","block_type":"box","text":"4","page_number":35,"box":{"x":68,"y":391,"width":4,"height":4}},{"id":"72194b27-43fe-4c66-b92c-b8e7ef1f372d","block_type":"box","text":"Chair of the Per formance Oversight Committee.","page_number":35,"box":{"x":93,"y":391,"width":269,"height":9}},{"id":"4b6106bc-c5e6-401c-8330-8e15179ab531","block_type":"box","text":"5","page_number":35,"box":{"x":69,"y":404,"width":3,"height":3}},{"id":"542dab21-69d6-477f-9565-66eb6195b6d2","block_type":"box","text":"Chair of the Board and Chair of the Ad Hoc Topics Committee.","page_number":35,"box":{"x":93,"y":404,"width":352,"height":8}},{"id":"2d63a0e3-224e-486f-9209-4018e97a9502","block_type":"box","text":"6","page_number":35,"box":{"x":69,"y":416,"width":3,"height":4}},{"id":"286b21d6-d40d-4e66-99c3-b82758c4598f","block_type":"box","text":"Chair of the Compliance Committee.","page_number":35,"box":{"x":93,"y":416,"width":205,"height":9}},{"id":"ae125f38-a9de-4aa2-b083-45110dfae39d","block_type":"box","text":"IV. Management, Advisory and Other Service Arrangements","page_number":35,"box":{"x":69,"y":445,"width":432,"height":11}},{"id":"4346d557-7a57-4bb6-b21e-81b54b44cb5b","block_type":"box","text":"Management Agreement","page_number":35,"box":{"x":69,"y":475,"width":180,"height":11}},{"id":"dc1aeec3-5e26-4ac1-aa15-623e8cae05ff","block_type":"box","text":"The Trust, on behalf of the Fund, has entered into a management agreement with BlackRock pursuant to which","page_number":35,"box":{"x":101,"y":498,"width":791,"height":11}},{"id":"ec7cc428-afb4-48b6-a46d-0a4e7325fa81","block_type":"box","text":"BlackRock is entitled to receive fees for the services it provides (the “Management Agreement”).","page_number":35,"box":{"x":70,"y":513,"width":689,"height":11}},{"id":"1c17d220-5023-4535-9672-3d1c09a438eb","block_type":"box","text":"BlackRock has contractually agreed to waive the management fee with respect to any por tion of the Fund’s","page_number":35,"box":{"x":102,"y":535,"width":762,"height":12}},{"id":"0907b2e2-b4fa-424c-9bfa-927965769402","block_type":"box","text":"assets estimated to be attributable to investments in other equity and fixed-income mutual funds and exchange","page_number":35,"box":{"x":69,"y":550,"width":799,"height":12}},{"id":"06ab7b4f-a1c6-4f78-a3e5-a88ff5d8aebc","block_type":"box","text":"traded funds managed by BlackRock or its affiliates that have a contractual management fee, through","page_number":35,"box":{"x":68,"y":566,"width":726,"height":11}},{"id":"1c80a377-e840-4d87-aabf-d030fca8e7c7","block_type":"box","text":"June 30, 2027. BlackRock has contractually agreed to waive its management fees by the amount of advisory fees","page_number":35,"box":{"x":69,"y":581,"width":813,"height":11}},{"id":"461e71be-178f-499d-bb72-5a25762aca25","block_type":"box","text":"the Fund pays to BlackRock indirectly through its investment in money market funds advised by BlackRock or its","page_number":35,"box":{"x":68,"y":596,"width":799,"height":11}},{"id":"3fa2fe02-24fb-4eff-a089-f8d836ddb110","block_type":"box","text":"affiliates, through June 30, 2027. The contractual agreements may be terminated upon 90 days’ notice by a majority","page_number":35,"box":{"x":69,"y":611,"width":836,"height":11}},{"id":"b6a11efa-160d-4448-9618-50e2b8cf5e12","block_type":"box","text":"of the Independent Trustees or by a vote of a majority of the outstanding voting securities of the Fund.","page_number":35,"box":{"x":69,"y":626,"width":727,"height":11}},{"id":"e740849d-79a2-4f68-a24a-cfa7eb7ce43a","block_type":"box","text":"BlackRock has contractually agreed to waive and/or reimburse fees or expenses of the Fund in order to limit","page_number":35,"box":{"x":102,"y":650,"width":773,"height":11}},{"id":"d084da45-f3e5-4357-af93-86b71c10e222","block_type":"box","text":"Total Annual Fund Operating Expenses After Fee Waivers and/or Expense Reimbursements (excluding Dividend","page_number":35,"box":{"x":68,"y":665,"width":787,"height":11}},{"id":"cf8e3bae-276d-4939-87c2-a0a6c3957332","block_type":"box","text":"Expense, Interest Expense, Acquired Fund Fees and Expenses and cer tain other Fund expenses (as defined in the","page_number":35,"box":{"x":70,"y":680,"width":811,"height":11}},{"id":"c5a220d1-d0af-4f78-9c64-b4f8cde52357","block_type":"box","text":"Fund’s Prospectus)) to 1.00% for Investor A Shares, 1.75% for Investor C Shares and 0.75% for Institutional Shares","page_number":35,"box":{"x":70,"y":695,"width":825,"height":11}},{"id":"1ee1cdef-dab6-4b0f-b32b-c18e0411fb5d","block_type":"box","text":"of average daily net assets through June 30, 2027.","page_number":35,"box":{"x":69,"y":710,"width":365,"height":12}},{"id":"b09d0dce-67e3-4e46-823f-55ae8fff3634","block_type":"box","text":"Pursuant to the Management Agreement, BlackRock may from time to time, in its sole discretion to the extent","page_number":35,"box":{"x":102,"y":733,"width":784,"height":11}},{"id":"850c2cd4-dd34-47b8-afd0-1bc4129a3689","block_type":"box","text":"permitted by applicable law, appoint one or more sub-advisers, including, without limitation, affiliates of BlackRock, to","page_number":35,"box":{"x":70,"y":748,"width":838,"height":12}},{"id":"dd9280c7-1582-4e24-8b9d-97fe512d8723","block_type":"box","text":"per form investment advisory services with respect to the Fund. In addition, BlackRock may delegate cer tain of its","page_number":35,"box":{"x":70,"y":763,"width":810,"height":12}},{"id":"f3990d1b-431b-43c0-b0a3-276c37a8af89","block_type":"box","text":"investment advisory functions under the Management Agreement to one or more of its affiliates to the extent","page_number":35,"box":{"x":70,"y":778,"width":779,"height":12}},{"id":"5dde81da-b493-4d8e-89f7-fe96767d2de6","block_type":"box","text":"permitted by applicable law. BlackRock may terminate any or all sub-advisers or such delegation arrangements in its","page_number":35,"box":{"x":70,"y":794,"width":827,"height":11}},{"id":"a4e20e28-4d12-4777-a189-76fe8e9e8ec3","block_type":"box","text":"sole discretion at any time to the extent permitted by applicable law.","page_number":35,"box":{"x":69,"y":809,"width":486,"height":11}},{"id":"39582734-b9c1-4557-8168-b2c2efab5174","block_type":"box","text":"BlackRock entered into sub-advisory agreements with BlackRock International Limited (“BIL”) and BlackRock","page_number":35,"box":{"x":102,"y":832,"width":773,"height":11}},{"id":"f45c4174-370d-4721-b676-e88e859f515a","block_type":"box","text":"(Singapore) Limited (“BRS,” and together with BIL, the “Sub-Advisers”), pursuant to which BlackRock pays each Sub","page_number":35,"box":{"x":69,"y":847,"width":831,"height":11}},{"id":"18a90696-8af1-4994-bdb0-c75674bb4648","block_type":"box","text":"Adviser for providing services to BlackRock with respect to that por tion of the Fund for which it acts as a sub-adviser","page_number":35,"box":{"x":68,"y":862,"width":832,"height":11}},{"id":"2448e2c4-4107-4df1-aad1-6521af07209d","block_type":"box","text":"a monthly fee at an annual rate equal to a percentage of the management fee paid to BlackRock under the","page_number":35,"box":{"x":69,"y":877,"width":761,"height":11}},{"id":"ad8d8254-6f2b-47fd-9980-794d923f92d2","block_type":"box","text":"Management Agreement.","page_number":35,"box":{"x":70,"y":892,"width":176,"height":11}},{"id":"78bfd591-cb58-460c-be13-6962dfe97d1c","block_type":"box","text":"I-19","page_number":35,"box":{"x":476,"y":943,"width":26,"height":9}},{"id":"7de67f49-7d08-46c0-8c92-b9c786efec85","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":35,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"f8044eb9-015c-45ee-a45a-40b796c501e8","block_type":"box","text":"In rendering investment advisory services to the Fund, BlackRock uses the por tfolio management, research and","page_number":36,"box":{"x":102,"y":45,"width":798,"height":11}},{"id":"8f85dbeb-3ff3-4045-88c1-64ceb1e48363","block_type":"box","text":"other resources of BlackRock Investment Management (Australia) Limited (“BlackRock Australia”), a foreign affiliate","page_number":36,"box":{"x":69,"y":60,"width":826,"height":11}},{"id":"859396ab-c476-4f46-ad60-13c7f8ccdbc0","block_type":"box","text":"of BlackRock that is not registered under the Investment Advisers Act of 1940, as amended (the “Advisers Act”).","page_number":36,"box":{"x":69,"y":75,"width":804,"height":11}},{"id":"36e1f136-f6ce-4951-81fa-36841c99e656","block_type":"box","text":"BlackRock Australia provides services to the Fund through a “par ticipating affiliate” arrangement, as that term is","page_number":36,"box":{"x":70,"y":90,"width":806,"height":11}},{"id":"60a48c93-c384-41bb-a8de-8f0aabb01e1e","block_type":"box","text":"used in relief granted by the staff of the SEC allowing U.S. registered investment advisers to use por tfolio","page_number":36,"box":{"x":69,"y":105,"width":754,"height":11}},{"id":"094bca0c-d63b-4cd7-8314-66f0e53a2d1f","block_type":"box","text":"management or research resources of advisory affiliates subject to the regulatory supervision of the registered","page_number":36,"box":{"x":69,"y":120,"width":794,"height":12}},{"id":"ebc73cfc-6cd0-480c-b640-fd429448dd3e","block_type":"box","text":"investment adviser. Under the par ticipating affiliate arrangement, BlackRock Australia is considered a par ticipating","page_number":36,"box":{"x":70,"y":135,"width":819,"height":12}},{"id":"64877835-8660-4bdd-b29f-8354bb0b9c52","block_type":"box","text":"affiliate of BlackRock, and BlackRock Australia and cer tain designated employees are considered “associated","page_number":36,"box":{"x":69,"y":150,"width":784,"height":12}},{"id":"2f3e26ed-ccf9-41a0-80af-adf9e435b5bd","block_type":"box","text":"persons” of BlackRock (as that term is defined in the Advisers Act) and investment professionals from BlackRock","page_number":36,"box":{"x":70,"y":166,"width":807,"height":11}},{"id":"eeeee60a-86ec-4d0b-9ba4-f7a055cda220","block_type":"box","text":"Australia may render por tfolio management, research and other services to the Fund, subject to the supervision of","page_number":36,"box":{"x":68,"y":181,"width":820,"height":11}},{"id":"fea7a448-9db2-4875-8ffc-535baf9b5b7a","block_type":"box","text":"BlackRock. The Fund pays no additional fees and expenses as a result of such arrangement.","page_number":36,"box":{"x":70,"y":196,"width":659,"height":11}},{"id":"7648718c-6774-4d6a-9187-364c48cd3866","block_type":"box","text":"The table below sets for th information about the total management fees paid by the Trust, on behalf of the Fund,","page_number":36,"box":{"x":101,"y":218,"width":806,"height":12}},{"id":"c4ea9196-a483-469e-9785-ea5f4518d3c9","block_type":"box","text":"to BlackRock (which includes amounts paid by the Manager to the Sub-Advisers), and the amounts waived and/or","page_number":36,"box":{"x":68,"y":234,"width":810,"height":11}},{"id":"666199da-80b2-4fc7-b427-bad32558080b","block_type":"box","text":"reimbursed, for the past three fiscal years.","page_number":36,"box":{"x":69,"y":249,"width":303,"height":11}},{"id":"1686db4d-b849-4b92-b37d-37402edddc31","block_type":"box","text":"Fees Paid","page_number":36,"box":{"x":598,"y":277,"width":56,"height":7}},{"id":"708a9ca5-5e95-42c7-8501-843f1fd5dc2d","block_type":"box","text":"to BlackRock","page_number":36,"box":{"x":586,"y":287,"width":79,"height":7}},{"id":"84434e51-cd0d-43de-9ba3-7bd66eb89f63","block_type":"box","text":"Fees Waived","page_number":36,"box":{"x":704,"y":277,"width":72,"height":7}},{"id":"5ba2c10c-ec59-4f85-a5ab-f54e87cf7443","block_type":"box","text":"by BlackRock","page_number":36,"box":{"x":700,"y":287,"width":80,"height":9}},{"id":"c6c53554-91d8-4473-84c7-7e06e731131b","block_type":"box","text":"Fees Reimbursed","page_number":36,"box":{"x":810,"y":277,"width":99,"height":7}},{"id":"8cf04ae8-fa9d-4368-af5e-bf803fd90c36","block_type":"box","text":"by BlackRock","page_number":36,"box":{"x":820,"y":287,"width":80,"height":9}},{"id":"20339233-b8fb-44c6-bb86-7678180393cf","block_type":"box","text":"Fiscal Year Ended January 31, 2026. . . . . . . . . . . . . . . . . . . . . . . .","page_number":36,"box":{"x":70,"y":305,"width":448,"height":11}},{"id":"d778237c-d00c-45d7-bc8a-0250f131277b","block_type":"box","text":". . . . $2,","page_number":36,"box":{"x":525,"y":304,"width":80,"height":11}},{"id":"1b978396-ea77-4532-8363-a2a6f6d7501b","block_type":"box","text":"555,725 $436,440 $379,775","page_number":36,"box":{"x":607,"y":304,"width":288,"height":11}},{"id":"86b4f420-c3e9-48e5-bac9-39a0507621e8","block_type":"box","text":"Fiscal Year Ended January 31, 2025. . . . . . . . . . . . . . . . . . . . . . . .","page_number":36,"box":{"x":70,"y":320,"width":448,"height":11}},{"id":"9dee5cc0-4904-4efa-bd65-450161563f60","block_type":"box","text":". . . . $2,","page_number":36,"box":{"x":525,"y":319,"width":80,"height":11}},{"id":"40e342a9-b9d3-4295-8a74-9399e417be09","block_type":"box","text":"249,499 $452,421 $365,066","page_number":36,"box":{"x":607,"y":319,"width":288,"height":11}},{"id":"561e30ed-96e2-4097-9ee5-b12b94c444cf","block_type":"box","text":"Fiscal Year Ended January 31, 2024. . . . . . . . . . . . . . . . . . . . . . . .","page_number":36,"box":{"x":70,"y":335,"width":448,"height":11}},{"id":"5a084311-12ab-4252-a193-d2030e0a1982","block_type":"box","text":". . . . $2,","page_number":36,"box":{"x":525,"y":334,"width":80,"height":12}},{"id":"cdebbe4b-c389-4cec-9ab8-f4adcba99781","block_type":"box","text":"399,597 $501,973 $520,852","page_number":36,"box":{"x":607,"y":334,"width":288,"height":12}},{"id":"666752d1-5a79-495b-a5cf-7b3175c4e6df","block_type":"box","text":"Administration Agreement","page_number":36,"box":{"x":68,"y":367,"width":191,"height":11}},{"id":"cd4b4b0b-4bab-4fb2-b533-4355754e0db2","block_type":"box","text":"BlackRock serves as the Fund’s administrator (in such capacity, the “Administrator”) pursuant to an","page_number":36,"box":{"x":102,"y":389,"width":711,"height":11}},{"id":"616591c0-c100-4ffb-a810-d7415cd1d2fe","block_type":"box","text":"administration agreement (the “Administration Agreement”). The Administrator has agreed to maintain office facilities","page_number":36,"box":{"x":69,"y":404,"width":838,"height":12}},{"id":"5c66c315-73e4-421b-bebf-57b13871ab7c","block_type":"box","text":"for the Fund; furnish the Fund with clerical, bookkeeping and administrative services; oversee the determination and","page_number":36,"box":{"x":68,"y":419,"width":830,"height":12}},{"id":"d05053e4-d2e7-45c4-b98c-4d0f6e3f51e8","block_type":"box","text":"publication of the Fund’s net asset value; oversee the preparation and filing of Federal, state and local income tax","page_number":36,"box":{"x":70,"y":435,"width":813,"height":11}},{"id":"f8b5ac81-9710-4831-afee-1e2373ff95ae","block_type":"box","text":"returns; prepare cer tain repor ts required by regulatory authorities; calculate various contractual expenses; determine","page_number":36,"box":{"x":69,"y":450,"width":837,"height":11}},{"id":"ffde62fb-3b3a-4414-af84-ecce31047aeb","block_type":"box","text":"the amount of dividends and distributions available for payment by the Fund to its shareholders; prepare and arrange","page_number":36,"box":{"x":68,"y":465,"width":836,"height":11}},{"id":"4cae7a36-0bf6-40ad-bd82-73839b286a43","block_type":"box","text":"for the printing of dividend notices to shareholders; provide Fund service providers with such information as is","page_number":36,"box":{"x":68,"y":480,"width":785,"height":11}},{"id":"8147d826-f82b-47c0-887e-1600d84653a3","block_type":"box","text":"required to effect the payment of dividends and distributions; and serve as liaison with the Trust’s officers,","page_number":36,"box":{"x":69,"y":495,"width":765,"height":11}},{"id":"86d0bba5-27e5-45b6-8c7c-57d2bdb87c14","block_type":"box","text":"independent accountants, legal counsel, custodian, accounting agent and transfer and dividend disbursing agent in","page_number":36,"box":{"x":70,"y":510,"width":819,"height":11}},{"id":"f7fbb3a3-ad12-431d-bb60-8ce46c07ca86","block_type":"box","text":"establishing the accounting policies of the Fund and monitoring financial and shareholder accounting services. The","page_number":36,"box":{"x":69,"y":525,"width":818,"height":12}},{"id":"377de3e7-d66c-46e5-9e32-e2efab021aba","block_type":"box","text":"Administrator may from time to time voluntarily waive administration fees with respect to the Fund and may voluntarily","page_number":36,"box":{"x":68,"y":540,"width":840,"height":12}},{"id":"4a92170b-ef2d-48c3-ae33-0d5854957094","block_type":"box","text":"reimburse the Fund for expenses.","page_number":36,"box":{"x":69,"y":555,"width":238,"height":11}},{"id":"69a9bb6d-e067-4d13-8aa3-c6cbc4c7d6b7","block_type":"box","text":"Under the Administration Agreement, the Trust, on behalf of the Fund, pays to the Administrator a fee, computed","page_number":36,"box":{"x":102,"y":578,"width":802,"height":11}},{"id":"48aec45b-1015-4065-a8ae-b6d1c5986ed6","block_type":"box","text":"daily and payable monthly, at an aggregate annual rate of (i) 0.0425% of the first $500 million of the Fund’s average","page_number":36,"box":{"x":69,"y":593,"width":830,"height":12}},{"id":"4f2eedb9-7f17-4538-94ca-add89af0b48a","block_type":"box","text":"daily net assets, 0.040% of the next $500 million of the Fund’s average daily net assets, 0.0375% of the next","page_number":36,"box":{"x":69,"y":608,"width":788,"height":12}},{"id":"8d7796dc-5979-4fce-93c1-dc01098ddbc4","block_type":"box","text":"$1 billion of the Fund’s average daily net assets, 0.035% of the next $2 billion of the Fund’s average daily net","page_number":36,"box":{"x":69,"y":623,"width":785,"height":12}},{"id":"c79b0c08-cb5a-4539-9473-0763b1dcca98","block_type":"box","text":"assets, 0.0325% of the next $9 billion of the Fund’s average daily net assets and 0.030% of the average daily net","page_number":36,"box":{"x":69,"y":638,"width":816,"height":12}},{"id":"3f6936b7-520b-47f8-93b3-b89206336f27","block_type":"box","text":"assets of the Fund in excess of $13 billion and (ii) 0.020% of average daily net assets allocated to each class of","page_number":36,"box":{"x":69,"y":653,"width":805,"height":12}},{"id":"db2ce807-62d6-4ecd-b02f-8f9713a637ff","block_type":"box","text":"shares of the Fund.","page_number":36,"box":{"x":69,"y":669,"width":137,"height":9}},{"id":"ad7f94f0-2f6d-4701-9789-3e88f3dac353","block_type":"box","text":"The table below sets for th information about the combined administration fees paid by the Trust, on behalf of","page_number":36,"box":{"x":101,"y":692,"width":782,"height":11}},{"id":"53edd925-fead-4b3c-85e6-7997efcc1896","block_type":"box","text":"the Fund, to the Administrator and the amounts waived and/or reimbursed for the past three fiscal years.","page_number":36,"box":{"x":68,"y":707,"width":751,"height":11}},{"id":"7e449cdb-956a-483f-885a-433d225b5f52","block_type":"box","text":"Fees Paid","page_number":36,"box":{"x":674,"y":735,"width":56,"height":7}},{"id":"b605f8b3-2989-47fa-b5fb-7e37986e2294","block_type":"box","text":"to the Administrator","page_number":36,"box":{"x":643,"y":745,"width":118,"height":7}},{"id":"ef92ce10-d7d0-4bf2-94e5-295fc57c2d81","block_type":"box","text":"Fees Waived","page_number":36,"box":{"x":814,"y":735,"width":72,"height":7}},{"id":"24bb97dc-6d45-4f0c-b366-af5505c40c6a","block_type":"box","text":"by the Administrator","page_number":36,"box":{"x":791,"y":745,"width":118,"height":9}},{"id":"0172322d-af1f-472a-810a-d05215bb1604","block_type":"box","text":"Fiscal Year Ended January 31, 2026 . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":36,"box":{"x":70,"y":763,"width":469,"height":11}},{"id":"7230e8cc-635b-4cab-b0e4-4b7143291c37","block_type":"box","text":".........","page_number":36,"box":{"x":545,"y":770,"width":67,"height":2}},{"id":"6f361ee5-691a-4448-8856-9d26f65b40e6","block_type":"box","text":"$213,014 $68,190","page_number":36,"box":{"x":666,"y":762,"width":215,"height":11}},{"id":"9acb1994-c672-4e7f-848f-89fa9fb0809b","block_type":"box","text":"Fiscal Year Ended January 31, 2025 . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":36,"box":{"x":70,"y":778,"width":469,"height":11}},{"id":"e9ebfa84-6bcc-4edb-a945-bfddbad018e7","block_type":"box","text":".........","page_number":36,"box":{"x":545,"y":785,"width":67,"height":2}},{"id":"b853b265-0e1f-4d1e-ab99-f100f0e9fc07","block_type":"box","text":"$187,465 $59,994","page_number":36,"box":{"x":666,"y":777,"width":215,"height":11}},{"id":"a0785445-8440-40e7-93ff-e6eaf15545bc","block_type":"box","text":"Fiscal Year Ended January 31, 2024 . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":36,"box":{"x":70,"y":793,"width":469,"height":11}},{"id":"2cbc6d76-2359-4dfe-96e8-31cdd0a718c5","block_type":"box","text":".........","page_number":36,"box":{"x":545,"y":800,"width":67,"height":2}},{"id":"fbf399f3-affb-44b7-9dbe-587bc455a765","block_type":"box","text":"$200,066 $64,089","page_number":36,"box":{"x":666,"y":792,"width":215,"height":11}},{"id":"48695e3b-cbab-4cc6-8e09-f571c09a1176","block_type":"box","text":"The Trust and its service providers may engage third par ty plan administrators who provide trustee,","page_number":36,"box":{"x":101,"y":817,"width":708,"height":11}},{"id":"1c9c70a4-8fd9-44b2-b038-802ce4042cc9","block_type":"box","text":"administrative and recordkeeping services for cer tain employee benefit, profit-sharing and retirement plans as agents","page_number":36,"box":{"x":69,"y":832,"width":838,"height":11}},{"id":"91cc112e-0bf0-4600-b484-97bcc5a066bf","block_type":"box","text":"for the Trust with respect to such plans, for the purpose of accepting orders for the purchase and redemption of","page_number":36,"box":{"x":68,"y":847,"width":800,"height":11}},{"id":"0ac76525-c1e2-4dfe-a72b-e6b7887778d4","block_type":"box","text":"shares of the Fund.","page_number":36,"box":{"x":69,"y":862,"width":137,"height":9}},{"id":"12ad0632-4bac-4874-b25b-0c071c42f097","block_type":"box","text":"In addition, pursuant to a Shareholders’ Administrative Services Agreement, BlackRock provides cer tain","page_number":36,"box":{"x":102,"y":885,"width":740,"height":11}},{"id":"1fd86710-a750-4b7f-85dd-10c2236c19fe","block_type":"box","text":"shareholder liaison services in connection with the Trust’s investor service center. The Trust, on behalf of the Fund,","page_number":36,"box":{"x":69,"y":900,"width":824,"height":11}},{"id":"9b7327b1-7025-4c4e-9702-c24fa097774d","block_type":"box","text":"I-20","page_number":36,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"25c3ab6d-1103-44de-987c-92f9d99eeb66","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":36,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"9981ecf9-e71d-4ae9-9b2a-322c2f05b344","block_type":"box","text":"reimburses BlackRock for its costs in maintaining the service center, which costs include, among other things,","page_number":37,"box":{"x":69,"y":45,"width":787,"height":11}},{"id":"194f57c9-85dd-4912-a333-da6081096835","block_type":"box","text":"employee salaries, leasehold expenses, and other out-of-pocket expenses.","page_number":37,"box":{"x":69,"y":60,"width":531,"height":11}},{"id":"1b89e6fd-7553-42e1-8e93-8d535db173e8","block_type":"box","text":"For the past three fiscal years, the Trust, on behalf of the Fund, reimbursed to BlackRock fees for shareholder","page_number":37,"box":{"x":102,"y":82,"width":784,"height":12}},{"id":"4a48117c-2ae4-4a30-85ca-4ffdb0352e6f","block_type":"box","text":"liaison services pursuant to such agreement as follows:","page_number":37,"box":{"x":70,"y":98,"width":397,"height":11}},{"id":"00e3c7f2-a0a0-45ee-8a18-8ab937c19902","block_type":"box","text":"Fees Paid","page_number":37,"box":{"x":655,"y":126,"width":55,"height":7}},{"id":"64686554-beb9-44c5-b4f6-7ff0072734de","block_type":"box","text":"to BlackRock Fees Waived by BlackRock","page_number":37,"box":{"x":643,"y":136,"width":267,"height":9}},{"id":"f303b90d-e90a-4010-9607-ec6e052f7325","block_type":"box","text":"Fiscal Year Ended January 31, 2026 . . . . . . . . . . . . . . . . . . . . . . . .","page_number":37,"box":{"x":70,"y":154,"width":452,"height":11}},{"id":"be84b525-736e-46c8-beb0-3886ea9b6f6a","block_type":"box","text":". . . . . . . . . . . $5,096 $5,096","page_number":37,"box":{"x":529,"y":153,"width":328,"height":11}},{"id":"d2401830-3965-4c87-81e8-463581cadf0b","block_type":"box","text":"Fiscal Year Ended January 31, 2025 . . . . . . . . . . . . . . . . . . . . . . . .","page_number":37,"box":{"x":70,"y":169,"width":452,"height":11}},{"id":"ac435ed1-d12c-4e00-bf68-ae60da848c40","block_type":"box","text":". . . . . . . . . . . $1,697 $1,697","page_number":37,"box":{"x":529,"y":168,"width":327,"height":11}},{"id":"191e307b-a8f8-4bec-85ea-f5069807a121","block_type":"box","text":"Fiscal Year Ended January 31, 2024 . . . . . . . . . . . . . . . . . . . . . . . .","page_number":37,"box":{"x":70,"y":184,"width":452,"height":11}},{"id":"c2859a0c-80d6-4975-a9e3-9c2b35d1c023","block_type":"box","text":". . . . . . . . . . . $2,344 $2,344","page_number":37,"box":{"x":529,"y":183,"width":328,"height":11}},{"id":"7c8b5736-fea8-43af-9633-5357b0259f2a","block_type":"box","text":"Information Regarding the Portfolio Managers","page_number":37,"box":{"x":69,"y":215,"width":335,"height":11}},{"id":"e212b758-4668-42c0-a94d-49617dee66fc","block_type":"box","text":"Rajan Rehan, CFA and Cur tis Yee are the por tfolio managers and are jointly and primarily responsible for the day","page_number":37,"box":{"x":102,"y":238,"width":804,"height":11}},{"id":"fead5c70-a8c4-450a-a007-08152366cb84","block_type":"box","text":"to-day management of the Fund.","page_number":37,"box":{"x":68,"y":253,"width":229,"height":11}},{"id":"abd9b472-305f-4f15-b883-a949bc485efc","block_type":"box","text":"Other Funds and Accounts Managed","page_number":37,"box":{"x":70,"y":283,"width":265,"height":11}},{"id":"85f82f16-d8c8-436a-b5d2-9f5262ee6fcf","block_type":"box","text":"The following table sets for th information about the funds and accounts other than the Fund for which the Fund’s","page_number":37,"box":{"x":101,"y":306,"width":806,"height":11}},{"id":"87dc1819-3420-4deb-905f-e4cac649dced","block_type":"box","text":"por tfolio managers are primarily responsible for the day-to-day por tfolio management as of January 31, 2026.","page_number":37,"box":{"x":70,"y":321,"width":781,"height":11}},{"id":"d00628ad-5994-4038-8931-ee30dee579b8","block_type":"box","text":"Number of Other Accounts Managed","page_number":37,"box":{"x":351,"y":349,"width":211,"height":9}},{"id":"561dd7c0-2015-4e92-aa2e-fc65ff0cca33","block_type":"box","text":"and Assets by Account Type","page_number":37,"box":{"x":374,"y":360,"width":165,"height":8}},{"id":"124ef672-d04c-4e73-b84c-eef4873e49d5","block_type":"box","text":"Number of Other Accounts and Assets","page_number":37,"box":{"x":656,"y":349,"width":222,"height":8}},{"id":"fee01b41-726a-45d6-a622-84277995ff2d","block_type":"box","text":"for Which Advisory Fee is Performance-Based","page_number":37,"box":{"x":634,"y":360,"width":265,"height":8}},{"id":"55c03709-02ea-4326-a046-ab1c351d6885","block_type":"box","text":"Name of Portfolio Manager","page_number":37,"box":{"x":74,"y":402,"width":157,"height":9}},{"id":"605345df-3ab3-45d8-b29a-938131c52ec8","block_type":"box","text":"Other","page_number":37,"box":{"x":330,"y":372,"width":31,"height":7}},{"id":"919b364c-5c13-4d49-a1a0-58d60a880b54","block_type":"box","text":"Registered","page_number":37,"box":{"x":314,"y":382,"width":62,"height":9}},{"id":"d9660c40-fa07-4b09-8e2e-ffc13539abea","block_type":"box","text":"Investment","page_number":37,"box":{"x":313,"y":392,"width":65,"height":7}},{"id":"e4b3cc81-08f9-4fdf-9eea-2da7db472ee2","block_type":"box","text":"Companies","page_number":37,"box":{"x":313,"y":402,"width":64,"height":9}},{"id":"bf0ed626-d848-46a1-b6b9-c5c65339ba1b","block_type":"box","text":"Other Pooled","page_number":37,"box":{"x":419,"y":382,"width":75,"height":7}},{"id":"a24e61c2-4732-49b7-80fb-bd4f4d9a0cab","block_type":"box","text":"Investment","page_number":37,"box":{"x":425,"y":392,"width":64,"height":7}},{"id":"8e0a8381-c29e-45af-9e72-44ccfcc0f71c","block_type":"box","text":"Vehicles","page_number":37,"box":{"x":433,"y":402,"width":48,"height":8}},{"id":"00690f52-6b98-47b3-a6dc-c4fece0bdb15","block_type":"box","text":"Other","page_number":37,"box":{"x":553,"y":392,"width":31,"height":7}},{"id":"32602bee-586f-47bb-85ef-7b566a542a19","block_type":"box","text":"Accounts","page_number":37,"box":{"x":541,"y":403,"width":54,"height":7}},{"id":"7315ecc8-ac18-4c8f-a66e-be7107120a23","block_type":"box","text":"Other","page_number":37,"box":{"x":656,"y":372,"width":32,"height":7}},{"id":"2cc45cc2-ed84-4cbf-a072-661d8d38b2d7","block_type":"box","text":"Registered","page_number":37,"box":{"x":641,"y":382,"width":62,"height":9}},{"id":"ee8c2aa5-bbb0-4f53-ae22-35d509eab69a","block_type":"box","text":"Investment","page_number":37,"box":{"x":640,"y":392,"width":64,"height":7}},{"id":"1f3c464f-6d06-4f95-aa03-feb507c3b871","block_type":"box","text":"Companies","page_number":37,"box":{"x":640,"y":402,"width":64,"height":9}},{"id":"0f25e97a-dab2-4cfd-8429-8ca36038f794","block_type":"box","text":"Other Pooled","page_number":37,"box":{"x":735,"y":382,"width":74,"height":7}},{"id":"229f9e8f-b11b-4c7b-8ea6-6b1e7fd32707","block_type":"box","text":"Investment","page_number":37,"box":{"x":740,"y":392,"width":64,"height":7}},{"id":"ad817086-98b2-475a-8b55-4c0f7e800f86","block_type":"box","text":"Vehicles","page_number":37,"box":{"x":748,"y":402,"width":48,"height":8}},{"id":"f7335065-b575-4a9d-ab40-677df31dce68","block_type":"box","text":"Other","page_number":37,"box":{"x":852,"y":392,"width":31,"height":7}},{"id":"41c7c50e-05cc-4e8f-a67d-8d7fca1c4872","block_type":"box","text":"Accounts","page_number":37,"box":{"x":840,"y":403,"width":54,"height":7}},{"id":"715c5e83-fff0-4d71-8c1e-f38990fb075c","block_type":"box","text":"Rajan Rehan 14 9 8 0 0 0","page_number":37,"box":{"x":74,"y":416,"width":797,"height":9}},{"id":"82c569b0-e4c3-4043-8b57-4cdd4a2dd4bb","block_type":"box","text":"$766.94 Million $1.22 Billion $2.77 Billion $0 $0 $0","page_number":37,"box":{"x":300,"y":428,"width":574,"height":9}},{"id":"2f51b4ee-8a51-412b-b856-1fa8b869b83c","block_type":"box","text":"Cur tis Yee 0 4 3 0 0 0","page_number":37,"box":{"x":74,"y":441,"width":797,"height":8}},{"id":"e65fa7ca-fb86-4292-a4f2-394552a9c119","block_type":"box","text":"$0 $606.61 Million $662.15 Million $0 $0 $0","page_number":37,"box":{"x":338,"y":453,"width":536,"height":9}},{"id":"52c36027-f517-4589-b1bf-7c450a89921d","block_type":"box","text":"Por tfolio Manager Compensation Overview","page_number":37,"box":{"x":69,"y":488,"width":304,"height":11}},{"id":"3faf73f7-1066-45c2-8c48-3e48a994103f","block_type":"box","text":"The discussion below describes the por tfolio managers’ compensation as of January 31, 2026.","page_number":37,"box":{"x":101,"y":511,"width":682,"height":11}},{"id":"67eba7fe-15ba-447d-b11d-d421f5f7f435","block_type":"box","text":"BlackRock’s financial arrangements with its por tfolio managers, its competitive compensation and its career","page_number":37,"box":{"x":102,"y":533,"width":774,"height":12}},{"id":"05314d17-e941-426b-b100-1e18c9c9e648","block_type":"box","text":"path emphasis at all levels reflect the value senior management places on key resources. Compensation may include","page_number":37,"box":{"x":70,"y":549,"width":837,"height":11}},{"id":"9aabea22-b1e2-4495-acad-1f20356dc1c4","block_type":"box","text":"a variety of components and may vary from year to year based on a number of factors. The principal components of","page_number":37,"box":{"x":69,"y":564,"width":823,"height":11}},{"id":"98c00d6c-7747-4f08-b0da-2a2055e2f5dd","block_type":"box","text":"compensation include a base salary, a per formance-based discretionary bonus, par ticipation in various benefits","page_number":37,"box":{"x":69,"y":579,"width":799,"height":11}},{"id":"c0b2f0fb-7526-4585-a93a-e0ea06ecf477","block_type":"box","text":"programs and one or more of the incentive compensation programs established by BlackRock.","page_number":37,"box":{"x":70,"y":594,"width":670,"height":11}},{"id":"89966aa4-7bd0-41be-9ab3-c5b5a8fd3430","block_type":"box","text":"Base Compensation.","page_number":37,"box":{"x":102,"y":617,"width":148,"height":11}},{"id":"4b0e9779-d475-4491-ba06-bf8c61a45d37","block_type":"box","text":"Generally, por tfolio managers receive base compensation based on their position with the","page_number":37,"box":{"x":257,"y":617,"width":640,"height":11}},{"id":"57f90268-ea34-479b-a9b1-3c2ad1d6197e","block_type":"box","text":"firm.","page_number":37,"box":{"x":68,"y":632,"width":32,"height":9}},{"id":"44c7b4de-c01b-4f02-b221-2ce7379bb460","block_type":"box","text":"Discretionary Incentive Compensation","page_number":37,"box":{"x":69,"y":662,"width":277,"height":11}},{"id":"4c2f071e-d477-4a9a-b71d-7fa52bde12ad","block_type":"box","text":"Discretionary incentive compensation is a function of several components: the per formance of BlackRock, Inc.,","page_number":37,"box":{"x":102,"y":685,"width":792,"height":11}},{"id":"447172fb-e077-4c1b-92a2-b3a1106a98a6","block_type":"box","text":"the per formance of the por tfolio manager’s group within BlackRock, the investment per formance, including risk","page_number":37,"box":{"x":68,"y":700,"width":800,"height":11}},{"id":"c402cd6e-12c3-4dad-b7ef-21559fd3afb7","block_type":"box","text":"adjusted returns, of the firm’s assets or strategies under management or supervision by that por tfolio manager, and/","page_number":37,"box":{"x":69,"y":715,"width":840,"height":11}},{"id":"320a02b4-5a4c-4016-9198-ea6f5d9c3cdd","block_type":"box","text":"or the individual’s per formance and contribution to the overall per formance of these por tfolios and BlackRock.","page_number":37,"box":{"x":69,"y":730,"width":787,"height":11}},{"id":"39799bc9-acb0-4a60-adbc-659e004cebaa","block_type":"box","text":"Among other things, BlackRock’s Chief Investment Officers make a subjective determination with respect to each","page_number":37,"box":{"x":68,"y":745,"width":808,"height":11}},{"id":"e71b1d8b-db0c-4d6c-93ea-11ad5cff06a4","block_type":"box","text":"por tfolio manager’s compensation based on the per formance of the Fund, other accounts or strategies managed by","page_number":37,"box":{"x":70,"y":760,"width":826,"height":12}},{"id":"0f578457-8527-4974-95c1-43af6b790085","block_type":"box","text":"each por tfolio manager. Per formance is generally measured on a pre-tax basis over various time periods including 1-,","page_number":37,"box":{"x":69,"y":775,"width":834,"height":12}},{"id":"6688bcb5-7d3b-470f-b199-e89d3b446c40","block_type":"box","text":"3- and 5-year periods, as applicable. With respect to these por tfolio managers, the benchmarks for this Fund are:","page_number":37,"box":{"x":69,"y":790,"width":807,"height":12}},{"id":"752c1681-bfae-4532-abc7-589cf05b97ba","block_type":"box","text":"Portfolio Manager Benchmarks","page_number":37,"box":{"x":69,"y":819,"width":267,"height":9}},{"id":"4b8ab049-357e-479d-887b-42db9c9e0e26","block_type":"box","text":"Rajan Rehan, CFA S&P Developed Proper ty Net Index, FTSE Nareit ALL EQUITY REITS Net Index, FTSE EPRA","page_number":37,"box":{"x":70,"y":835,"width":827,"height":11}},{"id":"047893a5-bfb5-4e1c-b6cf-45f8f76d802f","block_type":"box","text":"Nareit Developed Index Net Index. The per formance of other accounts or strategies","page_number":37,"box":{"x":265,"y":850,"width":592,"height":12}},{"id":"195ef990-901f-490c-b871-2a1b65f8cfe5","block_type":"box","text":"managed by these por tfolio managers may not be measured against a specific","page_number":37,"box":{"x":265,"y":865,"width":560,"height":12}},{"id":"64eedfc6-ed74-450f-adb9-915432149b8f","block_type":"box","text":"benchmark.","page_number":37,"box":{"x":265,"y":881,"width":81,"height":9}},{"id":"6d4a9f57-7386-4439-9741-8e73e7bba947","block_type":"box","text":"I-21","page_number":37,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"5f248360-bd07-4cf2-863f-fe18785fc031","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":37,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"6e744195-ef5b-44d1-af82-f49bc6afa479","block_type":"box","text":"Portfolio Manager Benchmarks","page_number":38,"box":{"x":69,"y":49,"width":267,"height":9}},{"id":"7515a67d-c23a-49b8-b61f-dae5ec14364f","block_type":"box","text":"Cur tis Yee FTSE Nareit ALL EQUITY REITS Net Index. The per formance of other accounts or strategies","page_number":38,"box":{"x":69,"y":65,"width":840,"height":12}},{"id":"5813c3e6-6bc4-48a1-8b47-d957cc3eaedf","block_type":"box","text":"managed by these por tfolio managers may not be measured against a specific","page_number":38,"box":{"x":265,"y":81,"width":560,"height":11}},{"id":"0089bfd5-907e-4a69-9867-8c848648e23e","block_type":"box","text":"benchmark.","page_number":38,"box":{"x":265,"y":96,"width":81,"height":9}},{"id":"397651f1-640d-48f6-9f1b-fd913fe40a13","block_type":"box","text":"Distribution of Discretionary Incentive Compensation.","page_number":38,"box":{"x":102,"y":120,"width":389,"height":11}},{"id":"290193b3-7901-46e3-8046-b914a0d62743","block_type":"box","text":"Discretionary incentive compensation is distributed to","page_number":38,"box":{"x":499,"y":120,"width":383,"height":11}},{"id":"9660cbb1-c475-47c2-bc0a-f0eb47097327","block_type":"box","text":"por tfolio managers in a combination of cash, deferred BlackRock, Inc. stock awards, and/or deferred cash awards","page_number":38,"box":{"x":70,"y":135,"width":815,"height":11}},{"id":"cdb0b00d-3538-4a88-bd7a-20b3c2d205f9","block_type":"box","text":"that notionally track the return of cer tain BlackRock investment products.","page_number":38,"box":{"x":68,"y":150,"width":522,"height":11}},{"id":"4f7e0411-fbf4-4ea9-848a-5aabfb9891de","block_type":"box","text":"Por tfolio managers receive their annual discretionary incentive compensation in the form of cash. Por tfolio","page_number":38,"box":{"x":102,"y":172,"width":760,"height":12}},{"id":"d333c101-89f7-4c9b-bf98-6424dd898695","block_type":"box","text":"managers whose total compensation is above a specified threshold also receive deferred BlackRock, Inc. stock","page_number":38,"box":{"x":69,"y":188,"width":795,"height":11}},{"id":"d5c3d961-bb90-42e0-a3b2-9182c4705684","block_type":"box","text":"awards annually as par t of their discretionary incentive compensation. Paying a por tion of discretionary incentive","page_number":38,"box":{"x":69,"y":203,"width":805,"height":11}},{"id":"64c8841e-ca17-4d8a-97d6-649e942ec4b0","block_type":"box","text":"compensation in the form of deferred BlackRock, Inc. stock puts compensation earned by a por tfolio manager for a","page_number":38,"box":{"x":69,"y":218,"width":822,"height":11}},{"id":"d455637b-e5ae-4e0d-973c-54a8d099a87c","block_type":"box","text":"given year “at risk” based on BlackRock’s ability to sustain and improve its per formance over future periods. In some","page_number":38,"box":{"x":68,"y":233,"width":839,"height":11}},{"id":"3381cf58-d185-4a82-8116-e66ccaa5276a","block_type":"box","text":"cases, additional deferred BlackRock, Inc. stock may be granted to cer tain key employees as par t of a long-term","page_number":38,"box":{"x":69,"y":248,"width":802,"height":11}},{"id":"74cc7f88-909d-4575-8128-633820251943","block_type":"box","text":"incentive award to aid in retention, align interests with long-term shareholders and motivate per formance. Deferred","page_number":38,"box":{"x":70,"y":263,"width":820,"height":12}},{"id":"de4028bb-60b7-4ad9-9c99-649421707eb9","block_type":"box","text":"BlackRock, Inc. stock awards are generally granted in the form of BlackRock, Inc. restricted stock units that vest","page_number":38,"box":{"x":70,"y":278,"width":801,"height":12}},{"id":"3e585728-bbfa-49eb-9e25-67118faefec6","block_type":"box","text":"pursuant to the terms of the applicable plan and, once vested, settle in BlackRock, Inc. common stock. The por tfolio","page_number":38,"box":{"x":70,"y":293,"width":831,"height":11}},{"id":"657824f7-0822-4518-a195-7859111e67ac","block_type":"box","text":"managers of this Fund have deferred BlackRock, Inc. stock awards.","page_number":38,"box":{"x":69,"y":309,"width":479,"height":11}},{"id":"9ef0ef18-b3dc-4159-b1ce-3150001ea521","block_type":"box","text":"For cer tain por tfolio managers, a por tion of the discretionary incentive compensation is also distributed in the","page_number":38,"box":{"x":102,"y":331,"width":785,"height":12}},{"id":"cf179afa-ff66-4ba0-9500-f3d5b2430c6f","block_type":"box","text":"form of deferred cash awards that notionally track the returns of select BlackRock investment products they manage,","page_number":38,"box":{"x":68,"y":346,"width":836,"height":12}},{"id":"9690f0c9-6daf-4ed9-b514-804137a14943","block_type":"box","text":"which provides direct alignment of por tfolio manager discretionary incentive compensation with investment product","page_number":38,"box":{"x":68,"y":361,"width":821,"height":12}},{"id":"19b76ed6-93c4-4cd9-aca2-27a8716bb8d1","block_type":"box","text":"results. Deferred cash awards vest ratably over a number of years and, once vested, settle in the form of cash. Only","page_number":38,"box":{"x":69,"y":377,"width":829,"height":11}},{"id":"b75a1aad-3c39-463f-892c-6d6e415c4cb1","block_type":"box","text":"por tfolio managers who manage specified products and whose total compensation is above a specified threshold are","page_number":38,"box":{"x":70,"y":392,"width":835,"height":11}},{"id":"10ae3ae5-d692-4a99-b58c-2b6a8e7f2b12","block_type":"box","text":"eligible to par ticipate in the deferred cash award program.","page_number":38,"box":{"x":69,"y":407,"width":414,"height":11}},{"id":"d07a5340-45bf-4777-b121-385f69527b44","block_type":"box","text":"Other Compensation Benefits.","page_number":38,"box":{"x":101,"y":430,"width":218,"height":11}},{"id":"a52b79b0-0402-4bd7-99f5-3d5341b6c949","block_type":"box","text":"In addition to base salary and discretionary incentive compensation, por tfolio","page_number":38,"box":{"x":327,"y":429,"width":552,"height":12}},{"id":"363bb765-7d63-44eb-878f-27cef944cd48","block_type":"box","text":"managers may be eligible to receive or par ticipate in one or more of the following:","page_number":38,"box":{"x":69,"y":445,"width":582,"height":11}},{"id":"1d24cd43-cf41-4b27-9b1e-5a3076245b56","block_type":"box","text":"Incentive Savings Plans","page_number":38,"box":{"x":102,"y":467,"width":167,"height":12}},{"id":"17f7e687-5379-4e12-b76c-bf33d8d210f5","block_type":"box","text":"— BlackRock, Inc. has created a variety of incentive savings plans in which BlackRock","page_number":38,"box":{"x":274,"y":467,"width":614,"height":12}},{"id":"7639d25b-066b-4435-9efc-4832eb3fb149","block_type":"box","text":"employees are eligible to par ticipate, including a 401(k) plan, the BlackRock Retirement Savings Plan (RSP), and the","page_number":38,"box":{"x":69,"y":483,"width":831,"height":11}},{"id":"c2c39dd8-3366-44a8-986d-5589661e5f13","block_type":"box","text":"BlackRock Employee Stock Purchase Plan (ESPP). The employer contribution components of the RSP include a","page_number":38,"box":{"x":70,"y":498,"width":785,"height":11}},{"id":"6601a21f-ba41-40a7-82e7-e71dc3eda354","block_type":"box","text":"company match equal to 50% of the first 8% of eligible pay contributed to the plan capped at $5,000 per year, and a","page_number":38,"box":{"x":69,"y":512,"width":830,"height":12}},{"id":"e95c81f4-3677-4407-9475-d30793c6b8f4","block_type":"box","text":"company retirement contribution equal to 3-5% of eligible compensation up to the Internal Revenue Service limit","page_number":38,"box":{"x":69,"y":528,"width":799,"height":11}},{"id":"a67c712d-52eb-4c79-9357-e7a6c70f1f51","block_type":"box","text":"($360,000 for 2026). The RSP offers a range of investment options, including registered investment companies and","page_number":38,"box":{"x":69,"y":542,"width":831,"height":12}},{"id":"7b4b24bb-86e3-486e-93c6-ac969e5a4dcd","block_type":"box","text":"collective investment funds managed by the firm. BlackRock contributions follow the investment direction set by","page_number":38,"box":{"x":69,"y":558,"width":798,"height":11}},{"id":"b60ef25f-cda1-4139-9e71-fec5b8626780","block_type":"box","text":"par ticipants for their own contributions or, absent par ticipant investment direction, are invested into a target date","page_number":38,"box":{"x":70,"y":573,"width":809,"height":11}},{"id":"d01fdcf1-b7fe-4d17-bd7c-2b825d860469","block_type":"box","text":"fund that corresponds to, or is closest to, the year in which the par ticipant attains age 65. The ESPP allows for","page_number":38,"box":{"x":68,"y":588,"width":793,"height":12}},{"id":"80589e58-02b8-4365-9c1a-1324aa035eca","block_type":"box","text":"investment in BlackRock common stock at a 5% discount on the fair market value of the stock on the purchase date.","page_number":38,"box":{"x":70,"y":603,"width":832,"height":11}},{"id":"2afacbe4-f0c3-4156-9b8a-f3a8a4d77191","block_type":"box","text":"Annual par ticipation in the ESPP is limited to the purchase of 1,000 shares of common stock or a dollar value of","page_number":38,"box":{"x":68,"y":618,"width":805,"height":11}},{"id":"a7b02e33-59ee-4d52-9f4b-2184251e39a8","block_type":"box","text":"$25,000 based on its fair market value on the purchase date. All of the eligible por tfolio managers are eligible to","page_number":38,"box":{"x":69,"y":633,"width":808,"height":12}},{"id":"f10ed9d5-f476-4d76-9d9b-166ef7ed8738","block_type":"box","text":"par ticipate in these plans.","page_number":38,"box":{"x":70,"y":649,"width":185,"height":11}},{"id":"4e51531e-c292-4465-b780-b2caf6f68e5c","block_type":"box","text":"Por tfolio Manager Beneficial Holdings","page_number":38,"box":{"x":69,"y":679,"width":268,"height":11}},{"id":"0a2d82f1-7a1b-48cd-b680-63b8452b434d","block_type":"box","text":"As of January 31, 2026, the Fund’s most recently completed fiscal year end, the dollar range of securities","page_number":38,"box":{"x":101,"y":702,"width":758,"height":11}},{"id":"3d741041-31d3-49d3-8bd6-1f4228ee4762","block_type":"box","text":"beneficially owned by the por tfolio managers in the Fund is shown below:","page_number":38,"box":{"x":69,"y":717,"width":519,"height":11}},{"id":"6e3f06d5-bce9-4744-8708-3c35dec563fd","block_type":"box","text":"Portfolio Manager","page_number":38,"box":{"x":69,"y":755,"width":105,"height":9}},{"id":"d4484953-7fa8-4999-a7fe-c04e018c5e23","block_type":"box","text":"Dollar Range of Equity","page_number":38,"box":{"x":759,"y":745,"width":129,"height":9}},{"id":"cf631592-957f-41dc-8f49-98a17c586e78","block_type":"box","text":"Securities Beneficially Owned","page_number":38,"box":{"x":736,"y":755,"width":173,"height":9}},{"id":"f58a6d01-2acb-4d2e-85a0-39c33f138765","block_type":"box","text":"Rajan Rehan, CFA","page_number":38,"box":{"x":70,"y":773,"width":125,"height":11}},{"id":"14007650-d165-4690-bc65-a86982788b37","block_type":"box","text":"...............................................................","page_number":38,"box":{"x":198,"y":780,"width":507,"height":2}},{"id":"a1f6c07e-8ed0-4ed6-ae5e-0209f34f7b0e","block_type":"box","text":"$50,001- $100,000","page_number":38,"box":{"x":751,"y":772,"width":144,"height":11}},{"id":"a744ca76-7bd1-47c2-8f4e-af590777c811","block_type":"box","text":"Cur tis Yee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":38,"box":{"x":69,"y":788,"width":636,"height":9}},{"id":"cc257384-4aa6-4770-a507-d0ab0a78bba7","block_type":"box","text":"$10,001 - $50,000","page_number":38,"box":{"x":754,"y":787,"width":138,"height":11}},{"id":"f153109e-8ddd-4015-80c3-9bb258e93e7c","block_type":"box","text":"Por tfolio Manager Potential Material Conflicts of Interest","page_number":38,"box":{"x":69,"y":819,"width":403,"height":12}},{"id":"dfa740e6-e254-4c28-b894-3fb8f9ea77c2","block_type":"box","text":"BlackRock has built a professional working environment, firm-wide compliance culture and compliance","page_number":38,"box":{"x":102,"y":842,"width":727,"height":11}},{"id":"15456cc3-f7a3-4284-ad19-d9ae07bf8383","block_type":"box","text":"procedures and systems designed to protect against potential incentives that may favor one account over another.","page_number":38,"box":{"x":70,"y":857,"width":814,"height":12}},{"id":"56a41b66-93e2-4a84-bfb2-5b139f3e409a","block_type":"box","text":"BlackRock has adopted policies and procedures that address the allocation of investment oppor tunities, execution of","page_number":38,"box":{"x":70,"y":872,"width":837,"height":11}},{"id":"7c233b3c-254c-4efb-a255-c181f1a4653d","block_type":"box","text":"por tfolio transactions, personal trading by employees and other potential conflicts of interest that are designed to","page_number":38,"box":{"x":70,"y":887,"width":810,"height":12}},{"id":"6a89dc15-317f-4acb-874a-8e6e18d5eb9a","block_type":"box","text":"ensure that all client accounts are treated equitably over time. Never theless, BlackRock furnishes investment","page_number":38,"box":{"x":69,"y":903,"width":782,"height":11}},{"id":"d27105e8-3324-499c-9d56-ee3d4caf7348","block_type":"box","text":"I-22","page_number":38,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"3ee7a18e-500b-4899-aff7-f91e76edd244","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":38,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"3d7fd577-2ada-48a1-9281-ca7e1bbf8a87","block_type":"box","text":"management and advisory services to numerous clients in addition to the Fund, and BlackRock may, consistent with","page_number":39,"box":{"x":69,"y":45,"width":830,"height":11}},{"id":"049ee6fb-d645-444c-b029-99096a239bb3","block_type":"box","text":"applicable law, make investment recommendations to other clients or accounts (including accounts which are hedge","page_number":39,"box":{"x":69,"y":60,"width":828,"height":11}},{"id":"bc837d1e-1816-4aa0-a29d-a04dbbc04bdd","block_type":"box","text":"funds or have per formance or higher fees paid to BlackRock, or in which por tfolio managers have a personal interest","page_number":39,"box":{"x":68,"y":75,"width":834,"height":11}},{"id":"3b9e3b52-c6e0-4b88-8e50-6565be098a80","block_type":"box","text":"in the receipt of such fees), which may be the same as or different from those made to the Fund. In addition,","page_number":39,"box":{"x":70,"y":90,"width":777,"height":11}},{"id":"289cc4de-998e-4e80-8180-48758233b4de","block_type":"box","text":"BlackRock, its affiliates and significant shareholders and any officer, director, shareholder or employee may or may","page_number":39,"box":{"x":70,"y":105,"width":821,"height":11}},{"id":"d7b90c40-ceb8-45fc-89e4-32191713d2d3","block_type":"box","text":"not have an interest in the securities whose purchase and sale BlackRock recommends to the Fund. BlackRock, or","page_number":39,"box":{"x":69,"y":120,"width":819,"height":11}},{"id":"bf643925-6b57-4a53-ab4d-2cbee1c70339","block_type":"box","text":"any of its affiliates or significant shareholders, or any officer, director, shareholder, employee or any member of their","page_number":39,"box":{"x":69,"y":135,"width":832,"height":12}},{"id":"87cd0ec7-5d7b-480b-9965-1fdaaad3d796","block_type":"box","text":"families may take different actions than those recommended to the Fund by BlackRock with respect to the same","page_number":39,"box":{"x":68,"y":150,"width":804,"height":12}},{"id":"d246e990-324f-4cc8-a3c9-f62ee022641f","block_type":"box","text":"securities. Moreover, BlackRock may refrain from rendering any advice or services concerning securities of","page_number":39,"box":{"x":69,"y":166,"width":760,"height":11}},{"id":"74f8ae25-4971-4a02-8bc1-6c12f63eda49","block_type":"box","text":"companies of which any of BlackRock’s (or its affiliates’ or significant shareholders’) officers, directors or employees","page_number":39,"box":{"x":69,"y":181,"width":834,"height":11}},{"id":"1f5b754c-2ff5-489d-a034-0b37da277aeb","block_type":"box","text":"are directors or officers, or companies as to which BlackRock or any of its affiliates or significant shareholders or the","page_number":39,"box":{"x":69,"y":196,"width":836,"height":11}},{"id":"7646c130-ae8c-4ef7-8ff8-4de2d29837ac","block_type":"box","text":"officers, directors and employees of any of them has any substantial economic interest or possesses material non","page_number":39,"box":{"x":69,"y":211,"width":822,"height":11}},{"id":"c7ad80be-df9d-4473-9fbe-033a91cda766","block_type":"box","text":"public information. Cer tain por tfolio managers also may manage accounts whose investment strategies may at times","page_number":39,"box":{"x":70,"y":226,"width":835,"height":11}},{"id":"f9972460-890c-4fc6-b8c2-14dcfb83dcab","block_type":"box","text":"be opposed to the strategy utilized for the Fund. It should also be noted that a por tfolio manager may be managing","page_number":39,"box":{"x":69,"y":241,"width":820,"height":11}},{"id":"f03c2ede-36b0-45c2-9dd4-17a282104941","block_type":"box","text":"hedge fund and/or long only accounts, or may be par t of a team managing hedge fund and/or long only accounts,","page_number":39,"box":{"x":69,"y":256,"width":811,"height":12}},{"id":"ff971297-f007-4a5d-98c6-c89d5eac2a40","block_type":"box","text":"subject to incentive fees. Such por tfolio managers may therefore be entitled to receive a por tion of any incentive fees","page_number":39,"box":{"x":69,"y":271,"width":839,"height":12}},{"id":"5ef9f53a-247b-4886-a64b-ddba9dd5fdc9","block_type":"box","text":"earned on such accounts. Currently, the por tfolio managers of this Fund are not entitled to receive a por tion of","page_number":39,"box":{"x":69,"y":286,"width":791,"height":12}},{"id":"7d8a7e30-d382-4179-b97e-70b23a781c02","block_type":"box","text":"incentive fees of other accounts.","page_number":39,"box":{"x":70,"y":302,"width":231,"height":9}},{"id":"fe62df92-e36c-45fb-b6cd-1b98b3b6b322","block_type":"box","text":"As a fiduciary, BlackRock owes a duty of loyalty to its clients and must treat each client fairly. When BlackRock","page_number":39,"box":{"x":101,"y":324,"width":788,"height":11}},{"id":"7e58d3dd-b299-45e6-a335-663b6c000f7f","block_type":"box","text":"purchases or sells securities for more than one account, the trades must be allocated in a manner consistent with its","page_number":39,"box":{"x":70,"y":339,"width":839,"height":11}},{"id":"3fe9ad52-03f7-4bb2-96c3-f552ee19d92b","block_type":"box","text":"fiduciary duties. BlackRock attempts to allocate investments in a fair and equitable manner among client accounts,","page_number":39,"box":{"x":68,"y":355,"width":823,"height":11}},{"id":"cd17b2ba-d165-4ef2-ad4e-8e4ff21b6053","block_type":"box","text":"with no account receiving preferential treatment. To this end, BlackRock has adopted policies that are intended to","page_number":39,"box":{"x":68,"y":370,"width":812,"height":11}},{"id":"2bc6357a-4d13-48c2-8f5b-72eed152217f","block_type":"box","text":"ensure reasonable efficiency in client transactions and provide BlackRock with sufficient flexibility to allocate","page_number":39,"box":{"x":69,"y":385,"width":777,"height":11}},{"id":"1091aea9-d54d-461c-84f9-4352e62565a6","block_type":"box","text":"investments in a manner that is consistent with the par ticular investment discipline and client base, as appropriate.","page_number":39,"box":{"x":70,"y":400,"width":826,"height":11}},{"id":"0ad3f10c-c871-4b33-85db-92d1486be7e3","block_type":"box","text":"Accounting Services","page_number":39,"box":{"x":68,"y":430,"width":150,"height":11}},{"id":"6b7eb16d-19e5-4082-94d2-300b9490cc47","block_type":"box","text":"BNY Mellon Investment Servicing (US) Inc. (“BNY MIS”) serves as the accounting services provider for the Fund.","page_number":39,"box":{"x":102,"y":453,"width":800,"height":11}},{"id":"182c7a0e-b15f-46fa-a8a5-64d50246555a","block_type":"box","text":"BNY MIS records investment, capital share and income and expense activities; verifies and transmits trade tickets;","page_number":39,"box":{"x":70,"y":468,"width":819,"height":11}},{"id":"25ada1b7-8245-4828-a8e1-b47c059db747","block_type":"box","text":"maintains accounting ledgers for investment securities; maintains tax lots; reconciles cash with the Fund’s","page_number":39,"box":{"x":69,"y":483,"width":761,"height":11}},{"id":"661be069-06cb-489d-a768-6fec9dc05c0a","block_type":"box","text":"custodian; repor ts cash balances to BlackRock; prepares cer tain financial statements; calculates expenses, gains,","page_number":39,"box":{"x":69,"y":498,"width":821,"height":11}},{"id":"917a78ad-cd2d-4562-aebf-cc04ab6b1198","block_type":"box","text":"losses and income; controls disbursements; works with independent pricing sources; and computes and repor ts net","page_number":39,"box":{"x":70,"y":514,"width":829,"height":11}},{"id":"4a76f4df-1e2e-4d95-af2a-1931f8351a25","block_type":"box","text":"asset value. In connection with its accounting services, BNY MIS also provides cer tain administration services.","page_number":39,"box":{"x":69,"y":529,"width":793,"height":11}},{"id":"9642a7f2-e895-41fc-a1fa-adaf09e66575","block_type":"box","text":"The table below shows the amounts paid by the Fund to BNY MIS for accounting services for the past three","page_number":39,"box":{"x":101,"y":551,"width":766,"height":11}},{"id":"c59b506c-8128-461d-8fae-d5cc08ed4288","block_type":"box","text":"fiscal years:","page_number":39,"box":{"x":68,"y":566,"width":85,"height":11}},{"id":"5c957431-a469-4d80-97de-c18503f2e101","block_type":"box","text":"Fees Paid to BNY MIS","page_number":39,"box":{"x":781,"y":595,"width":128,"height":7}},{"id":"be5fddb3-9026-4253-aa52-60167270bdca","block_type":"box","text":"Fiscal Year Ended January 31, 2026 . . . . . . . . . . . . . . . . . . . . . . . .","page_number":39,"box":{"x":70,"y":612,"width":451,"height":11}},{"id":"5fa7c4b3-3f8d-4c3d-b792-503ea052311d","block_type":"box","text":"............................","page_number":39,"box":{"x":528,"y":620,"width":222,"height":1}},{"id":"c5cd0e4a-291d-4ec8-9a75-e1be24b00418","block_type":"box","text":"$54,922","page_number":39,"box":{"x":814,"y":612,"width":62,"height":11}},{"id":"cdf3fdf0-4160-4bf9-8de3-403c94ac8e86","block_type":"box","text":"Fiscal Year Ended January 31, 2025 . . . . . . . . . . . . . . . . . . . . . . . .","page_number":39,"box":{"x":70,"y":627,"width":451,"height":11}},{"id":"21c52e86-4560-4b37-a262-cb353cf423af","block_type":"box","text":"............................","page_number":39,"box":{"x":528,"y":635,"width":222,"height":1}},{"id":"24e46d9f-f830-48c1-b531-415e35dbc8ea","block_type":"box","text":"$52,700","page_number":39,"box":{"x":814,"y":627,"width":62,"height":11}},{"id":"32a9c1a9-f930-447c-b307-67da1d236426","block_type":"box","text":"Fiscal Year Ended January 31, 2024 . . . . . . . . . . . . . . . . . . . . . . . .","page_number":39,"box":{"x":70,"y":643,"width":451,"height":11}},{"id":"d6a3e6bf-e726-474d-b727-1c0a02a4c428","block_type":"box","text":"............................","page_number":39,"box":{"x":528,"y":650,"width":222,"height":1}},{"id":"79bd02a4-c435-46b7-b86e-b73f3528848b","block_type":"box","text":"$53,987","page_number":39,"box":{"x":814,"y":642,"width":62,"height":11}},{"id":"581e0e20-45da-477b-a214-b0189f3e3c88","block_type":"box","text":"Custodian","page_number":39,"box":{"x":69,"y":674,"width":72,"height":9}},{"id":"58647418-fde2-41b7-a8df-cac6757a47ca","block_type":"box","text":"The Bank of New York Mellon (the “Custodian”), which has its principal place of business at 240 Greenwich","page_number":39,"box":{"x":101,"y":697,"width":767,"height":11}},{"id":"25ce0fd6-f260-464e-b573-da0c471e1e22","block_type":"box","text":"Street, New York, New York 10286, serves as the custodian for the Fund. The Custodian, among other","page_number":39,"box":{"x":69,"y":712,"width":731,"height":11}},{"id":"020b9266-463c-4331-a700-88e3b4065415","block_type":"box","text":"responsibilities, maintains a custody account or accounts in the name of the Fund, receives and delivers all assets","page_number":39,"box":{"x":69,"y":727,"width":820,"height":11}},{"id":"8e0548c2-a995-464c-bc42-e246d85a7ae1","block_type":"box","text":"for the Fund upon purchase and upon sale or maturity, and collects and receives all income and other payments and","page_number":39,"box":{"x":68,"y":742,"width":830,"height":11}},{"id":"a869c8b9-6878-4153-b6a3-4d9a6199ff2c","block_type":"box","text":"distributions on account of the assets of the Fund.","page_number":39,"box":{"x":69,"y":757,"width":359,"height":9}},{"id":"34e230b4-52a7-46ea-b2cf-8f9315da524d","block_type":"box","text":"Transfer Agent","page_number":39,"box":{"x":68,"y":787,"width":107,"height":11}},{"id":"ad2d89a4-4071-4f8c-940c-e64ac8d18118","block_type":"box","text":"BNY Mellon Investment Servicing (US) Inc., which has its principal place of business at 118 Flanders Road,","page_number":39,"box":{"x":102,"y":810,"width":764,"height":11}},{"id":"4c8120ba-e476-4dd8-96d5-2087160be8ea","block_type":"box","text":"Westborough, Massachusetts 01581, serves as transfer agent and dividend disbursing agent for the Fund.","page_number":39,"box":{"x":68,"y":825,"width":764,"height":11}},{"id":"c0d13b4c-b596-4ac2-aa08-1830f37da717","block_type":"box","text":"Credit Agreement","page_number":39,"box":{"x":69,"y":855,"width":129,"height":11}},{"id":"0b5f11e9-41cd-4484-b447-5c9f57f52782","block_type":"box","text":"The Trust, on behalf of the Fund, along with cer tain other funds managed by the Manager and its affiliates","page_number":39,"box":{"x":101,"y":878,"width":757,"height":11}},{"id":"a7f4e8c9-4bd6-4333-acfe-7bf881372253","block_type":"box","text":"(“Par ticipating Funds”), is a par ty to a 364-day, $2.4 billion credit agreement with a group of lenders, which facility","page_number":39,"box":{"x":69,"y":892,"width":817,"height":12}},{"id":"d16915aa-3d43-4316-816d-66682201e675","block_type":"box","text":"terminates on April 8, 2027, unless otherwise extended or renewed (the “Credit Agreement”). Excluding","page_number":39,"box":{"x":68,"y":908,"width":743,"height":12}},{"id":"22041bd2-3403-4ab5-a3b3-b28e3aefc0a0","block_type":"box","text":"I-23","page_number":39,"box":{"x":476,"y":943,"width":26,"height":9}},{"id":"be4d1ecb-8ee5-493d-a009-dbe899a69512","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":39,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"b9aba440-0016-4b3c-b04d-8f45caa7c57f","block_type":"box","text":"commitments designated for cer tain Par ticipating Funds, the Par ticipating Funds, including the Fund, can borrow up","page_number":40,"box":{"x":69,"y":45,"width":825,"height":11}},{"id":"a427fd42-4446-4045-b9dc-9d93613b34cc","block_type":"box","text":"to an aggregate commitment amount of $1.75 billion at any time outstanding, subject to asset coverage and other","page_number":40,"box":{"x":68,"y":59,"width":818,"height":12}},{"id":"702b1729-39ac-4109-9ef7-a59f2dd08167","block_type":"box","text":"limitations as specified in the Credit Agreement. 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Computation of Offering Price Per Share","page_number":40,"box":{"x":68,"y":671,"width":318,"height":12}},{"id":"53903dfc-8ede-473a-a712-4b89a667977d","block_type":"box","text":"An illustration of the computation of the public offering price of the Investor A Shares of the Fund based on the","page_number":40,"box":{"x":101,"y":694,"width":790,"height":11}},{"id":"fcf2217d-69b2-4a51-a984-d2d84e27fda1","block_type":"box","text":"value of the Fund’s Investor A Shares’ net assets and the number of Investor A Shares outstanding on","page_number":40,"box":{"x":68,"y":709,"width":731,"height":11}},{"id":"57971c14-c03e-42f6-a12d-762d3fd2186c","block_type":"box","text":"January 31, 2026, is set for th below.","page_number":40,"box":{"x":69,"y":724,"width":265,"height":11}},{"id":"f787af31-bab3-4a9d-ba88-8f73d6569a5b","block_type":"box","text":"Investor A Shares","page_number":40,"box":{"x":807,"y":753,"width":102,"height":7}},{"id":"1033e56d-525c-4caf-b2b6-08f23016c13b","block_type":"box","text":"Net Assets","page_number":40,"box":{"x":70,"y":771,"width":76,"height":8}},{"id":"697d05e9-a51c-402d-8ec7-08a7a96827f9","block_type":"box","text":".............................................................................","page_number":40,"box":{"x":154,"y":778,"width":621,"height":1}},{"id":"3b8fd560-628e-4635-b3f3-b8f2309236a5","block_type":"box","text":"$20,695,435","page_number":40,"box":{"x":810,"y":770,"width":96,"height":11}},{"id":"e5cfb336-5b3d-4148-bb40-094162d02650","block_type":"box","text":"Number of Shares Outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":40,"box":{"x":70,"y":785,"width":444,"height":12}},{"id":"ecb827f8-437c-43d1-b7f1-24792d61b366","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,","page_number":40,"box":{"x":521,"y":786,"width":321,"height":10}},{"id":"cd9d4421-4870-4476-ab76-0c014f72bc12","block_type":"box","text":"357,065","page_number":40,"box":{"x":844,"y":786,"width":62,"height":10}},{"id":"6efb2291-767d-49fe-b389-a6e0229a8ee2","block_type":"box","text":"Net Asset Value Per Share (net assets divided by number of shares outstanding) .","page_number":40,"box":{"x":70,"y":801,"width":583,"height":11}},{"id":"8443fe67-0849-49d4-82cd-5c7e7923b672","block_type":"box","text":"...............","page_number":40,"box":{"x":659,"y":808,"width":116,"height":1}},{"id":"3405ed87-e283-46fc-a8d6-4eff0ad80467","block_type":"box","text":"$15.25","page_number":40,"box":{"x":854,"y":800,"width":52,"height":10}},{"id":"55b082a0-7470-4e5c-9fe4-7f35d2dac71b","block_type":"box","text":"Sales Charge (5.25% of offering price; 5.54% of net asset value per share)","page_number":40,"box":{"x":69,"y":816,"width":534,"height":11}},{"id":"5ff1e01c-4041-4923-990b-60f786abafed","block_type":"box","text":"1","page_number":40,"box":{"x":604,"y":816,"width":4,"height":4}},{"id":"52f2164d-06a3-4a3c-a565-c8762bc1b10d","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . $0.85","page_number":40,"box":{"x":611,"y":815,"width":295,"height":10}},{"id":"ce71ce5e-ad43-42d3-9df9-309845dd638c","block_type":"box","text":"Offering Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":40,"box":{"x":69,"y":835,"width":706,"height":11}},{"id":"518aa3af-f5b9-4d2d-a17e-2903500ea690","block_type":"box","text":"$16.10","page_number":40,"box":{"x":854,"y":835,"width":52,"height":10}},{"id":"78dd9af9-c722-4b96-a0a7-00b958ca05b4","block_type":"box","text":"1","page_number":40,"box":{"x":69,"y":867,"width":3,"height":4}},{"id":"a9c73a49-e81e-46eb-b972-ac89dbcf01ad","block_type":"box","text":"Assumes maximum sales charge is applicable.","page_number":40,"box":{"x":93,"y":867,"width":267,"height":9}},{"id":"bfe73fc7-209a-4402-a84e-a5eb81d5ebdc","block_type":"box","text":"The offering price for the Fund’s other share classes is equal to the share class’ net asset value computed as","page_number":40,"box":{"x":101,"y":888,"width":787,"height":11}},{"id":"82a4e8ce-4c66-4728-8f6b-47eb2f5f0a8d","block_type":"box","text":"set for th above for Investor A Shares. Though not subject to a sales charge, cer tain share classes may be subject to","page_number":40,"box":{"x":69,"y":903,"width":833,"height":12}},{"id":"c03ab339-c15a-4537-be13-3c04facfce3c","block_type":"box","text":"I-24","page_number":40,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"71e03555-2306-4b8e-b78e-2e79a29ad871","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":40,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"dd77129f-874b-4a15-8e85-d47b4ee3c595","block_type":"box","text":"a CDSC on redemption. For more information on the purchasing and valuation of shares, please see “Purchase of","page_number":41,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"fb139671-9dfe-46b1-a3f9-97171b426232","block_type":"box","text":"Shares” and “Pricing of Shares” in Par t II of this SAI.","page_number":41,"box":{"x":69,"y":60,"width":377,"height":11}},{"id":"c417ef24-4bef-4e30-aa7b-2a2f24b72dec","block_type":"box","text":"VII. Portfolio Transactions and Brokerage","page_number":41,"box":{"x":68,"y":90,"width":302,"height":11}},{"id":"7cd05a78-908c-41da-b3a7-f5c4fe3b1ac9","block_type":"box","text":"See “Por tfolio Transactions and Brokerage” in Par t II of this SAI for more information.","page_number":41,"box":{"x":102,"y":113,"width":609,"height":11}},{"id":"14ec0f0f-928f-4b35-a927-77a90db9eee7","block_type":"box","text":"Information about the brokerage commissions paid by the Fund, including commissions paid to affiliates, is set","page_number":41,"box":{"x":102,"y":135,"width":794,"height":12}},{"id":"73024a75-d841-4419-b8cc-1ca8f3b22832","block_type":"box","text":"for th in the following table:","page_number":41,"box":{"x":68,"y":150,"width":191,"height":12}},{"id":"6cd698ac-e1cd-4455-9013-583b74c6ff30","block_type":"box","text":"Aggregate","page_number":41,"box":{"x":698,"y":179,"width":61,"height":9}},{"id":"21427b90-3e8b-4cf8-bae6-e773717885bd","block_type":"box","text":"Brokerage","page_number":41,"box":{"x":700,"y":189,"width":59,"height":9}},{"id":"cd502835-30a2-4aed-9353-3d4357d3f4ff","block_type":"box","text":"Commissions Paid","page_number":41,"box":{"x":676,"y":199,"width":106,"height":7}},{"id":"4fa93215-da5f-466c-880f-084762164687","block_type":"box","text":"Commissions","page_number":41,"box":{"x":822,"y":189,"width":77,"height":7}},{"id":"ae5aa04b-42fa-4df2-84bc-9d0e01773e64","block_type":"box","text":"Paid to Affiliates","page_number":41,"box":{"x":813,"y":199,"width":96,"height":7}},{"id":"43d52778-0bcd-447d-b1f8-ebecf4ab774b","block_type":"box","text":"Fiscal Year Ended January 31, 2026 . .","page_number":41,"box":{"x":70,"y":217,"width":273,"height":11}},{"id":"c18a10b3-a306-4c34-9c68-64122f210bf4","block_type":"box","text":".....................................","page_number":41,"box":{"x":349,"y":224,"width":296,"height":1}},{"id":"08bb1fba-b65f-455c-b475-620278f1fcae","block_type":"box","text":"$424,995","page_number":41,"box":{"x":693,"y":216,"width":72,"height":11}},{"id":"4758ffae-fd1c-4035-a1e5-9118970a2634","block_type":"box","text":"1","page_number":41,"box":{"x":766,"y":217,"width":4,"height":4}},{"id":"5a6cd9ff-2c83-40a5-b502-c2a51acbfcc4","block_type":"box","text":"$0","page_number":41,"box":{"x":852,"y":216,"width":18,"height":10}},{"id":"34921d4c-4c72-48e8-bb37-c2a3c8062923","block_type":"box","text":"Fiscal Year Ended January 31, 2025 . .","page_number":41,"box":{"x":70,"y":232,"width":273,"height":11}},{"id":"104e1790-786a-451c-a5c4-8785a6170fc9","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 63,339 $0","page_number":41,"box":{"x":349,"y":231,"width":521,"height":11}},{"id":"c179a9f0-26f5-4195-b8ca-b0ebafdea34b","block_type":"box","text":"Fiscal Year Ended January 31, 2024 . .","page_number":41,"box":{"x":70,"y":247,"width":273,"height":11}},{"id":"2e359259-ac5d-4439-a2ec-e03563dc735a","block_type":"box","text":".....................................","page_number":41,"box":{"x":349,"y":254,"width":296,"height":2}},{"id":"424f7500-c9cc-4827-8f32-a3c3b3537a5c","block_type":"box","text":"$106,599 $0","page_number":41,"box":{"x":693,"y":246,"width":177,"height":11}},{"id":"fd5a4977-e668-4dc7-9479-8d08b1045692","block_type":"box","text":"1 The increase in brokerage commissions paid by the Fund as compared to the prior fiscal year was primarily due to increases in por tfolio turnover","page_number":41,"box":{"x":69,"y":271,"width":837,"height":9}},{"id":"652e89cc-0536-436b-a5c4-453584ab6c26","block_type":"box","text":"and assets under management.","page_number":41,"box":{"x":69,"y":282,"width":180,"height":8}},{"id":"223d3af7-985e-4d2d-b368-d5964ebdf51b","block_type":"box","text":"The following table shows the dollar amount of brokerage commissions paid to brokers for providing Section","page_number":41,"box":{"x":101,"y":302,"width":770,"height":12}},{"id":"8ce9fa28-020d-4ccb-9b11-982e9cc6137f","block_type":"box","text":"28(e) research/brokerage services under Section 28(e) of the Securities Exchange Act of 1934, as amended, and","page_number":41,"box":{"x":69,"y":317,"width":814,"height":12}},{"id":"cdaef2f0-dfa3-4844-9a41-7fe79df6b794","block_type":"box","text":"the approximate dollar amount of the transactions involved for the fiscal year ended January 31, 2026. The provision","page_number":41,"box":{"x":68,"y":332,"width":836,"height":12}},{"id":"fc21dbe2-17c7-440f-be37-494a78aa8237","block_type":"box","text":"of Section 28(e) research/brokerage services was not necessarily a factor in the placement of all brokerage","page_number":41,"box":{"x":69,"y":348,"width":771,"height":11}},{"id":"3d3a5856-9e9a-4073-8adc-6d973b9c12f3","block_type":"box","text":"business with such brokers.","page_number":41,"box":{"x":69,"y":363,"width":198,"height":9}},{"id":"fcb9db4d-191f-4950-8f68-d1a7d0d17c18","block_type":"box","text":"Amount of Commissions","page_number":41,"box":{"x":357,"y":391,"width":141,"height":7}},{"id":"d4e431dd-3cf9-4ed5-892b-b8df6a261147","block_type":"box","text":"Paid to Brokers for","page_number":41,"box":{"x":374,"y":401,"width":109,"height":7}},{"id":"a3d5c9b5-1627-424d-b3fb-186d249439bf","block_type":"box","text":"Providing 28(e) Eligible Research Services","page_number":41,"box":{"x":304,"y":411,"width":249,"height":9}},{"id":"a3baac81-50bb-4723-aa13-bed488108d29","block_type":"box","text":"Amount of Brokerage","page_number":41,"box":{"x":593,"y":401,"width":124,"height":9}},{"id":"f324444a-f68f-48ea-9017-65c2b337b702","block_type":"box","text":"Transactions Involved","page_number":41,"box":{"x":592,"y":411,"width":126,"height":7}},{"id":"fd94a18a-4f10-4634-9a63-831ee1e89f20","block_type":"box","text":"$196,097 $227,571,178","page_number":41,"box":{"x":392,"y":428,"width":317,"height":11}},{"id":"076de873-fe66-4db3-b3f2-2cd8f197b3ec","block_type":"box","text":"As of January 31, 2026, the Fund held no securities of its regular brokers or dealers (as defined in Rule 10b-1","page_number":41,"box":{"x":101,"y":453,"width":789,"height":11}},{"id":"4e4f8635-589b-4d68-9eb4-d53670841f67","block_type":"box","text":"under the Investment Company Act) or their parents whose shares were purchased during the fiscal year ended","page_number":41,"box":{"x":69,"y":468,"width":792,"height":11}},{"id":"fb4a1173-967f-4f57-9d32-c720367cced1","block_type":"box","text":"January 31, 2026.","page_number":41,"box":{"x":69,"y":483,"width":131,"height":11}},{"id":"ade5f691-c9e6-4463-9c5b-c87fe7cd327c","block_type":"box","text":"Securities Lending","page_number":41,"box":{"x":68,"y":513,"width":135,"height":11}},{"id":"a64bcea2-4f56-4622-bc62-433d391da7d1","block_type":"box","text":"To the extent that the Fund engages in securities lending, the Fund conducts its securities lending pursuant to an","page_number":41,"box":{"x":101,"y":536,"width":807,"height":11}},{"id":"7028340a-3114-4336-a132-b5b02113fb6a","block_type":"box","text":"exemptive order from the Commission permitting it to lend por tfolio securities to borrowers affiliated with the Fund","page_number":41,"box":{"x":69,"y":551,"width":817,"height":11}},{"id":"dcf2ce39-e8b5-475d-8d4f-f013dfbebab5","block_type":"box","text":"and to retain an affiliate of the Fund as securities lending agent. To the extent that the Fund engages in securities","page_number":41,"box":{"x":69,"y":566,"width":813,"height":11}},{"id":"e35ad777-bef2-4a7f-945a-bd91d4264e79","block_type":"box","text":"lending, BlackRock Investment Management, LLC (“BIM”) acts as securities lending agent for the Fund, subject to the","page_number":41,"box":{"x":70,"y":581,"width":838,"height":12}},{"id":"958494f4-e69b-48ea-85cc-65fc9f524fab","block_type":"box","text":"overall supervision of the Manager, pursuant to a written agreement (the “Securities Lending Agency Agreement”).","page_number":41,"box":{"x":69,"y":596,"width":813,"height":12}},{"id":"e8e914c6-9e8a-4084-bfd5-186132101ddf","block_type":"box","text":"BIM administers the lending program in accordance with guidelines approved by the Board.","page_number":41,"box":{"x":70,"y":612,"width":646,"height":11}},{"id":"be2f744c-a160-44b2-ab7e-62df8473014a","block_type":"box","text":"The Fund retains a por tion of the securities lending income and remits the remaining por tion to BIM as","page_number":41,"box":{"x":101,"y":634,"width":735,"height":12}},{"id":"72d80de2-709c-412b-9100-e9d576117399","block_type":"box","text":"compensation for its services as securities lending agent. Securities lending income is generally equal to the total of","page_number":41,"box":{"x":69,"y":649,"width":834,"height":12}},{"id":"f194600c-8be3-48b5-bd0b-1f0d096dc5af","block_type":"box","text":"income earned from the reinvestment of cash collateral (and excludes collateral investment fees as defined below),","page_number":41,"box":{"x":70,"y":664,"width":822,"height":12}},{"id":"6ec91796-3af6-45e9-ab52-712c7c40c6cb","block_type":"box","text":"and any fees or other payments to and from borrowers of securities. As securities lending agent, BIM bears all","page_number":41,"box":{"x":69,"y":680,"width":787,"height":11}},{"id":"b4e25560-f8bc-4506-a968-3467ad9aa56a","block_type":"box","text":"operational costs directly related to securities lending. The Fund is responsible for fees in connection with the","page_number":41,"box":{"x":69,"y":695,"width":783,"height":11}},{"id":"292edb81-f5dc-408f-8ed5-8001bc53dad7","block_type":"box","text":"investment of cash collateral received for securities on loan in a money market fund managed by BlackRock (the","page_number":41,"box":{"x":70,"y":710,"width":800,"height":11}},{"id":"b8db65b7-3340-41d6-8cda-de311f8e6292","block_type":"box","text":"“collateral investment fees”); however, the securities lending agent has agreed to reduce the amount of securities","page_number":41,"box":{"x":70,"y":725,"width":813,"height":11}},{"id":"c524cf29-78d2-46ce-a776-4ec438094996","block_type":"box","text":"lending income it receives in order to effectively limit the collateral investment fees the Fund bears to an annual rate","page_number":41,"box":{"x":70,"y":740,"width":830,"height":11}},{"id":"edbc4be9-43e5-48eb-a2f1-074edadb1d95","block_type":"box","text":"of 0.04%. Such money market fund shares will not be subject to a sales load, distribution fee or service fee.","page_number":41,"box":{"x":69,"y":755,"width":773,"height":11}},{"id":"cb8574b8-ad75-45a7-b642-fb195417b647","block_type":"box","text":"To the extent that the Fund invests cash collateral in a non-government money market fund, the Fund may be","page_number":41,"box":{"x":101,"y":778,"width":776,"height":11}},{"id":"5c1b89dc-4da5-4720-82ea-99aa223e6bcd","block_type":"box","text":"subject to a discretionary liquidity fee of up to 2% on all redemptions. Discretionary liquidity fees may be imposed or","page_number":41,"box":{"x":69,"y":793,"width":831,"height":11}},{"id":"ffcb75fc-5748-4b43-97a1-682d0bbf069e","block_type":"box","text":"terminated at any time at the discretion of the board of directors of the money market fund, or its delegate, if it is","page_number":41,"box":{"x":68,"y":808,"width":812,"height":11}},{"id":"0ccb26db-e6c0-4e38-b1c9-46c3ccc2f450","block_type":"box","text":"determined that such fee would be, or would not be, respectively, in the best interest of the money market fund.","page_number":41,"box":{"x":69,"y":823,"width":799,"height":11}},{"id":"a7d2c27c-8243-44b2-9508-1cfd3efcb569","block_type":"box","text":"Additionally, the Fund will be subject to a mandatory liquidity fee if the money market fund’s total net redemptions on","page_number":41,"box":{"x":68,"y":838,"width":835,"height":11}},{"id":"70992d6b-659e-4ca3-ab37-df7a6a7704ed","block_type":"box","text":"a single day exceed 5% of the money market fund’s net assets, unless the liquidity costs are de minimis (i.e., less","page_number":41,"box":{"x":69,"y":853,"width":818,"height":12}},{"id":"30bef611-1071-44f9-b549-b4137ee8ee8e","block_type":"box","text":"than one basis point (0.01%)). The money market fund will determine the size of the mandatory liquidity fee by","page_number":41,"box":{"x":68,"y":869,"width":789,"height":11}},{"id":"e8a28fc2-e396-4675-bdc9-080a745f60d1","block_type":"box","text":"making a good faith estimate of cer tain costs the money market fund would incur if it were to sell a pro rata amount","page_number":41,"box":{"x":69,"y":884,"width":829,"height":11}},{"id":"d69cf992-c43f-407c-ba00-5267e0cb064b","block_type":"box","text":"of each security in the por tfolio to satisfy the amount of net redemptions on that day. There is no limit to the size of a","page_number":41,"box":{"x":69,"y":899,"width":839,"height":11}},{"id":"614d109e-ab7f-40dd-961d-67e0e293b473","block_type":"box","text":"I-25","page_number":41,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"2de8c5c2-15af-47d3-a746-2c516bbbac78","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":41,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"38d54925-08dc-4432-8116-553c60417f47","block_type":"box","text":"mandatory liquidity fee. If the money market fund cannot estimate the costs of selling a pro rata amount of each","page_number":42,"box":{"x":69,"y":45,"width":802,"height":11}},{"id":"a59bbb8c-42db-4656-a2f7-b1453d70bdc0","block_type":"box","text":"por tfolio security in good faith and suppor ted by data, it is required to apply a default liquidity fee of 1% on the value","page_number":42,"box":{"x":70,"y":60,"width":830,"height":11}},{"id":"67f3c962-84d4-4da3-8e44-43af230a75df","block_type":"box","text":"of shares redeemed on that day. The imposition of any such discretionary or mandatory liquidity fee would reduce the","page_number":42,"box":{"x":69,"y":75,"width":838,"height":11}},{"id":"c927e41b-47ef-4d30-a8cf-8b94988dcfd5","block_type":"box","text":"Fund’s returns on securities lending.","page_number":42,"box":{"x":70,"y":90,"width":258,"height":11}},{"id":"eaeca7fe-2769-4c8a-8bbe-cb2fc0478036","block_type":"box","text":"Under the securities lending program, the Fund is categorized into one of several specific asset classes. The","page_number":42,"box":{"x":102,"y":113,"width":774,"height":11}},{"id":"bee3cbeb-5666-4105-9493-62777c3902ae","block_type":"box","text":"determination of the Fund’s asset class category (fixed-income, domestic equity, international equity, or fund of","page_number":42,"box":{"x":69,"y":128,"width":794,"height":11}},{"id":"dc464bc0-435b-412b-80d6-d58701ec7261","block_type":"box","text":"funds), each of which may be subject to a different fee arrangement, is based on a methodology agreed to by the","page_number":42,"box":{"x":68,"y":143,"width":809,"height":11}},{"id":"8ed60d08-4b29-49ff-8ede-9049dc37f62a","block_type":"box","text":"Fund and BIM.","page_number":42,"box":{"x":70,"y":158,"width":100,"height":9}},{"id":"22750f4f-0dd1-4dbb-9e25-6ad86a143745","block_type":"box","text":"Pursuant to the current securities lending agreement: (i) the Fund retains 81% of securities lending income","page_number":42,"box":{"x":102,"y":181,"width":761,"height":11}},{"id":"6f9ab802-16ef-4231-a09a-5557c0dcbb1c","block_type":"box","text":"(which excludes collateral investment fees); and (ii) this amount can never be less than 70% of the sum of securities","page_number":42,"box":{"x":69,"y":196,"width":832,"height":11}},{"id":"fe8b5283-8480-46f2-b168-1bd4bd3a84b1","block_type":"box","text":"lending income plus collateral investment fees.","page_number":42,"box":{"x":70,"y":211,"width":334,"height":11}},{"id":"b9ea9fe6-c2fd-402a-93d4-4a480497cba8","block_type":"box","text":"In addition, commencing the business day following the date that the aggregate securities lending income","page_number":42,"box":{"x":102,"y":234,"width":753,"height":11}},{"id":"c1e59811-4282-4b1e-9b71-fdb124c721a3","block_type":"box","text":"earned across the BlackRock Multi-Asset Complex in a calendar year exceeds a specific threshold, the Fund,","page_number":42,"box":{"x":69,"y":249,"width":773,"height":11}},{"id":"bb21ce29-51b9-492a-901b-899c2b287f85","block_type":"box","text":"pursuant to the current securities lending agreement, will receive for the remainder of that calendar year securities","page_number":42,"box":{"x":70,"y":264,"width":817,"height":11}},{"id":"fa4745a3-fd10-4c80-aa47-5cd672115cbc","block_type":"box","text":"lending income as follows: (i) 84% of securities lending income (which excludes collateral investment fees); and","page_number":42,"box":{"x":70,"y":279,"width":794,"height":11}},{"id":"3ad046fe-8bc8-4fe8-8598-0db24ccc3cb8","block_type":"box","text":"(ii) this amount can never be less than 70% of the sum of securities lending income plus collateral investment fees.","page_number":42,"box":{"x":69,"y":294,"width":825,"height":11}},{"id":"27132404-f921-479b-a668-e8d160504ada","block_type":"box","text":"Prior to January 1, 2026, the Fund was subject to the same securities lending fee arrangement.","page_number":42,"box":{"x":102,"y":318,"width":683,"height":11}},{"id":"084fadd8-0782-4d66-91ab-c181e1f2e52c","block_type":"box","text":"The services provided to the Fund by BIM, in the most recent fiscal year ended January 31, 2026, primarily","page_number":42,"box":{"x":101,"y":341,"width":765,"height":11}},{"id":"fa036836-25c1-4382-976f-ffb4a9a38e46","block_type":"box","text":"included the following:","page_number":42,"box":{"x":70,"y":356,"width":156,"height":11}},{"id":"4c53caa1-15d8-46cc-ac61-c31e2a2048f9","block_type":"box","text":"(1) selecting borrowers from an approved list of borrowers and executing a securities lending agreement as agent","page_number":42,"box":{"x":69,"y":376,"width":818,"height":11}},{"id":"0460d079-f655-4b14-9304-cf0269a2b500","block_type":"box","text":"on behalf of the Fund with each such borrower;","page_number":42,"box":{"x":102,"y":391,"width":333,"height":11}},{"id":"46235464-d92d-4cd9-92dd-8cf2cfbcbda5","block_type":"box","text":"(2) negotiating the terms of securities loans, including the amount of fees;","page_number":42,"box":{"x":69,"y":411,"width":538,"height":12}},{"id":"7f3ef0c4-efbc-43e2-9e49-0b9fc7575e9b","block_type":"box","text":"(3) directing the delivery of loaned securities;","page_number":42,"box":{"x":69,"y":431,"width":330,"height":12}},{"id":"a600bcae-7359-47bf-886c-6aca1df82e0b","block_type":"box","text":"(4) monitoring the daily value of the loaned securities and directing the payment of additional collateral or the return","page_number":42,"box":{"x":69,"y":452,"width":834,"height":11}},{"id":"017d0566-17f5-4dc8-87f8-496fbe33ed12","block_type":"box","text":"of excess collateral, as necessary;","page_number":42,"box":{"x":102,"y":467,"width":246,"height":11}},{"id":"c144d6b0-f4e9-47d8-9547-13c27dc7d5d0","block_type":"box","text":"(5) investing cash collateral received in connection with any loaned securities;","page_number":42,"box":{"x":69,"y":487,"width":562,"height":11}},{"id":"f388933e-564b-495e-ba68-8e9933923197","block_type":"box","text":"(6) monitoring distributions on loaned securities (for example, interest and dividend activity);","page_number":42,"box":{"x":69,"y":507,"width":665,"height":11}},{"id":"bade4194-5443-403b-ad03-05bd540dd870","block_type":"box","text":"(7) in the event of default by a borrower with respect to any securities loan, using the collateral or the proceeds of","page_number":42,"box":{"x":69,"y":527,"width":822,"height":11}},{"id":"79cf6a8f-f8b7-4cae-9d71-b0916035d543","block_type":"box","text":"the liquidation of collateral to purchase replacement securities of the same issue, type, class and series as that","page_number":42,"box":{"x":101,"y":542,"width":803,"height":11}},{"id":"f6ffd5ae-2590-4ab7-8e4e-fde05e64890e","block_type":"box","text":"of the loaned securities; and","page_number":42,"box":{"x":102,"y":557,"width":203,"height":11}},{"id":"582f6d7b-7d3b-430b-905c-470518cb7324","block_type":"box","text":"(8) terminating securities loans and arranging for the return of loaned securities to the Fund at loan termination.","page_number":42,"box":{"x":69,"y":578,"width":808,"height":11}},{"id":"92f9c57f-7fa1-4b57-a604-d6f1871ae23c","block_type":"box","text":"The following table shows the dollar amounts of income and fees/compensation related to the securities lending","page_number":42,"box":{"x":101,"y":600,"width":805,"height":12}},{"id":"5978ba16-b62e-4cf9-84ae-a2e140fc813d","block_type":"box","text":"activities of the Fund during its most recent fiscal year ended January 31, 2026.","page_number":42,"box":{"x":69,"y":615,"width":573,"height":12}},{"id":"bbe1c1b8-1a21-4481-acfa-0291e71a4834","block_type":"box","text":"Gross income from securities lending 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210","page_number":42,"box":{"x":685,"y":677,"width":224,"height":11}},{"id":"65da19ea-f452-48c6-8fad-86ee293c6f4f","block_type":"box","text":"Cash collateral management expenses not included in securities lending income paid to BIM . .","page_number":42,"box":{"x":79,"y":693,"width":673,"height":11}},{"id":"31c3a2dc-2b1c-4e56-be11-961740d71870","block_type":"box","text":". . . . . . . . . $ 166","page_number":42,"box":{"x":758,"y":692,"width":151,"height":11}},{"id":"e8aa53c3-399e-425f-81e1-a213fddb3be5","block_type":"box","text":"Administrative fees not included in securities lending income paid to BIM . . . .","page_number":42,"box":{"x":78,"y":708,"width":551,"height":11}},{"id":"bc0106a4-3658-48cd-b084-199ade485fa5","block_type":"box","text":"........................ $ 0","page_number":42,"box":{"x":636,"y":707,"width":273,"height":11}},{"id":"c29b9202-0dbb-4997-be5e-8f0ddae637e0","block_type":"box","text":"Indemnification fees not included in securities lending income paid to BIM . . . . .","page_number":42,"box":{"x":79,"y":723,"width":567,"height":11}},{"id":"809841c8-eb62-40d6-a718-d53658ad9b6d","block_type":"box","text":"...................... $ 0","page_number":42,"box":{"x":652,"y":722,"width":257,"height":11}},{"id":"a6a78141-ceb0-4bd8-a828-2ff149f6490c","block_type":"box","text":"Rebates (paid to borrowers) . . . . . . . . . . .","page_number":42,"box":{"x":79,"y":738,"width":289,"height":11}},{"id":"d3333ab7-e2b0-4118-8961-8b617474f989","block_type":"box","text":"........................................................","page_number":42,"box":{"x":375,"y":746,"width":450,"height":1}},{"id":"db94d425-9a02-4f6c-a840-0449ed02dea1","block_type":"box","text":"$17,323","page_number":42,"box":{"x":847,"y":738,"width":62,"height":11}},{"id":"bbc13e6a-f413-434c-8b40-3261ae85a2f2","block_type":"box","text":"Other fees not included in securities lending income paid to BIM. . . . . . . . . . .","page_number":42,"box":{"x":79,"y":753,"width":542,"height":12}},{"id":"abf61bc5-3bb3-4480-bed0-d627dff86c82","block_type":"box","text":"......................... $ 0","page_number":42,"box":{"x":628,"y":753,"width":281,"height":10}},{"id":"e5720766-4653-44a8-aa19-ea81229a5a4c","block_type":"box","text":"Aggregate fees/compensation for securities lending activities","page_number":42,"box":{"x":68,"y":768,"width":455,"height":12}},{"id":"dbda4bd1-5a4e-401c-9877-b32ff885b7af","block_type":"box","text":".....................................","page_number":42,"box":{"x":530,"y":776,"width":295,"height":1}},{"id":"a5058c31-dc9a-467d-9662-28c1ef078bd1","block_type":"box","text":"$17,699","page_number":42,"box":{"x":847,"y":768,"width":62,"height":11}},{"id":"3dccf152-933a-4ef2-8b2c-940dc24bc55e","block_type":"box","text":"Net income from securities lending 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Additional Information","page_number":42,"box":{"x":68,"y":824,"width":195,"height":9}},{"id":"19dd1810-b7a7-4c60-a68b-f6c3834b4d3b","block_type":"box","text":"Independent Registered Public Accounting Firm.","page_number":42,"box":{"x":102,"y":847,"width":352,"height":11}},{"id":"10f70df1-5b8a-44b6-bc94-eec1a7bdc598","block_type":"box","text":"Deloitte & Touche LLP, with offices located at 115 Federal","page_number":42,"box":{"x":461,"y":846,"width":412,"height":11}},{"id":"93a3bd63-35ec-4311-9fc2-29e3b58d7ffb","block_type":"box","text":"Street, Boston, MA 02110, serves as the Fund’s independent registered public accounting firm.","page_number":42,"box":{"x":69,"y":862,"width":685,"height":11}},{"id":"b8b7f09d-42dd-486e-9fb5-94867a1876e7","block_type":"box","text":"Counsel.","page_number":42,"box":{"x":101,"y":884,"width":62,"height":9}},{"id":"135a2fc7-4fe9-4027-94d2-3c0eba09fd97","block_type":"box","text":"Ropes & Gray LLP, with offices at 1211 Avenue of the Americas, New York, New York 10036 serves as","page_number":42,"box":{"x":170,"y":884,"width":731,"height":11}},{"id":"8efffade-5bbe-4fc7-aa27-9cb92f30adc1","block_type":"box","text":"the Fund’s counsel.","page_number":42,"box":{"x":68,"y":900,"width":139,"height":8}},{"id":"aaa66fdd-6fe4-41aa-b20d-d957ec7ef4de","block_type":"box","text":"I-26","page_number":42,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"42ac9682-c601-4b34-9b03-ddde36854743","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":42,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"107f6c01-c522-41cf-8013-556655a8acad","block_type":"box","text":"The Trust","page_number":43,"box":{"x":68,"y":45,"width":69,"height":9}},{"id":"8e8d9792-6a78-44ff-b171-e92ca4e7c6de","block_type":"box","text":"The Trust was organized as a Massachusetts business trust on December 22, 1988, and is registered under the","page_number":43,"box":{"x":101,"y":67,"width":807,"height":12}},{"id":"74510448-f129-4884-98c9-1f91e70d4d53","block_type":"box","text":"Investment Company Act as an open-end, management investment company. The Fund is non-diversified. Effective","page_number":43,"box":{"x":70,"y":82,"width":813,"height":12}},{"id":"e795441c-b5de-4a42-b44a-850258922e8a","block_type":"box","text":"January 31, 1998, the Trust changed its name from Compass Capital Funds","page_number":43,"box":{"x":69,"y":98,"width":544,"height":11}},{"id":"87ba8f74-22e7-4334-96bb-61a695b8d99a","block_type":"box","text":"SM","page_number":43,"box":{"x":614,"y":98,"width":11,"height":4}},{"id":"601eb7b5-d7bb-4aab-9099-6013a8f2a2fe","block_type":"box","text":"to BlackRock Funds","page_number":43,"box":{"x":630,"y":98,"width":140,"height":9}},{"id":"7e82e1f4-3903-4488-b3dc-05ee2bcdf1cb","block_type":"box","text":"SM","page_number":43,"box":{"x":771,"y":98,"width":10,"height":4}},{"id":"3728f097-9fb1-44c1-a977-60fd6eb31bee","block_type":"box","text":". 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Financial Statements","page_number":44,"box":{"x":69,"y":310,"width":179,"height":9}},{"id":"ad638ae6-6886-4bbe-abed-9356f32791f8","block_type":"box","text":"The audited financial statements, financial highlights and notes thereto in the Fund’s Annual Financial","page_number":44,"box":{"x":101,"y":332,"width":726,"height":12}},{"id":"0dacb996-c55d-46cb-b8e8-eb8965663abe","block_type":"box","text":"Statements and Additional Information for the fiscal year ended January 31, 2026, as filed with the SEC on Form N","page_number":44,"box":{"x":69,"y":348,"width":826,"height":11}},{"id":"eaf7eca3-8f79-47d1-9a73-c4c552c947fa","block_type":"box","text":"CSR (the “2026 Annual Financial Statements”), are incorporated in this SAI by reference. No other par ts of the 2026","page_number":44,"box":{"x":69,"y":363,"width":835,"height":11}},{"id":"0461fc7f-d955-4580-bda5-3dd779d9ba7f","block_type":"box","text":"Annual Financial Statements are incorporated by reference herein. The 2026 Annual Financial Statements have been","page_number":44,"box":{"x":68,"y":378,"width":833,"height":11}},{"id":"653946f9-af27-40f3-9a9a-b6fe6b32a6b0","block_type":"box","text":"audited by Deloitte & Touche LLP. The repor t of Deloitte & Touche LLP is incorporated herein by reference. Such 2026","page_number":44,"box":{"x":69,"y":393,"width":839,"height":11}},{"id":"be9ddf66-e86e-4d1b-ab2b-498391fff3d8","block_type":"box","text":"Annual Financial Statements have been incorporated herein in reliance upon the repor t of such firm given their","page_number":44,"box":{"x":68,"y":408,"width":790,"height":11}},{"id":"15fa0475-88ef-41a0-9950-da829a53a3d8","block_type":"box","text":"authority as exper ts in accounting and auditing. Additional copies of the Fund’s annual and semi-annual repor ts to","page_number":44,"box":{"x":69,"y":423,"width":815,"height":12}},{"id":"3235709d-727c-49b0-836f-1db2e7333576","block_type":"box","text":"shareholders and the Fund’s Annual and Semi-Annual Financial Statements and Additional Information may be","page_number":44,"box":{"x":69,"y":438,"width":785,"height":11}},{"id":"911b78b8-3f91-4ae6-a829-b14abf915adb","block_type":"box","text":"obtained at no charge by telephoning the Distributor at the telephone number appearing on the front page of this SAI.","page_number":44,"box":{"x":69,"y":453,"width":836,"height":12}},{"id":"7cbd04cd-a43a-48a9-89f4-f23bb91f4365","block_type":"box","text":"I-28","page_number":44,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"bf2c6fbe-b78f-4b72-af16-4a4a433e067c","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":44,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"2fe89de0-4383-4306-aa19-842d1a4bf485","block_type":"box","text":"PART II","page_number":45,"box":{"x":463,"y":45,"width":52,"height":9}},{"id":"c952484c-ff6b-4d55-8967-c0dda241bba2","block_type":"box","text":"Throughout this Statement of Additional Information (“SAI”), each BlackRock-advised fund may be referred to as","page_number":45,"box":{"x":101,"y":67,"width":799,"height":12}},{"id":"ba428d12-73af-4123-8764-1963d557de2c","block_type":"box","text":"a “Fund” or collectively with others as the “Funds.” Cer tain Funds may also be referred to as “Municipal Funds” if","page_number":45,"box":{"x":69,"y":82,"width":813,"height":12}},{"id":"beeb0d6a-a5b5-4ad6-9492-07f85ee40aca","block_type":"box","text":"they invest cer tain of their assets in municipal investments described below.","page_number":45,"box":{"x":68,"y":98,"width":546,"height":11}},{"id":"2b24d222-8f98-4dc2-a161-4d4a05ebacfd","block_type":"box","text":"Each Fund is organized either as a Maryland corporation, a Massachusetts business trust or a Delaware","page_number":45,"box":{"x":102,"y":120,"width":745,"height":12}},{"id":"21346902-d19c-436b-b81c-277f50872b8f","block_type":"box","text":"statutory trust. In each jurisdiction, nomenclature varies. For ease and clarity of presentation, shares of common","page_number":45,"box":{"x":69,"y":135,"width":805,"height":11}},{"id":"ac54b97c-6074-48e3-8baa-85b44c3fb6ac","block_type":"box","text":"stock and shares of beneficial interest are referred to herein as “shares” or “Common Stock,” holders of shares of","page_number":45,"box":{"x":69,"y":150,"width":824,"height":11}},{"id":"66fea965-a04c-4d3a-923a-98e5c5e5f946","block_type":"box","text":"Common Stock are referred to as “shareholders,” the trustees or directors of each Fund are referred to as","page_number":45,"box":{"x":69,"y":166,"width":761,"height":10}},{"id":"9d6f6fb1-0b45-4e85-b007-6958cfea4e48","block_type":"box","text":"“Directors,” the boards of trustees/directors of each Fund are referred to as the “Board of Directors” or the “Board,”","page_number":45,"box":{"x":70,"y":181,"width":835,"height":11}},{"id":"07795a4a-7b26-4e61-ad3f-3ccb6f23dc5d","block_type":"box","text":"BlackRock Advisors, LLC, BlackRock Fund Advisors or their respective affiliates is the investment adviser or manager","page_number":45,"box":{"x":70,"y":196,"width":832,"height":11}},{"id":"7deb0763-51af-402f-885b-e1211b998410","block_type":"box","text":"of each Fund and is referred to herein as the “Manager” or “BlackRock,” and the investment advisory agreement or","page_number":45,"box":{"x":69,"y":211,"width":826,"height":11}},{"id":"315a25ec-7eba-46e2-b04e-699daf98d2c4","block_type":"box","text":"management agreement applicable to each Fund is referred to as the “Management Agreement.” Each Fund’s","page_number":45,"box":{"x":69,"y":226,"width":786,"height":11}},{"id":"6ec6cef3-6380-41eb-9f9a-962f69a73df9","block_type":"box","text":"Ar ticles of Incorporation or Declaration of Trust, together with all amendments thereto, is referred to as its “char ter.”","page_number":45,"box":{"x":68,"y":241,"width":834,"height":11}},{"id":"ef143a11-fbd3-4a53-9e70-6e58317a0669","block_type":"box","text":"The Investment Company Act of 1940, as amended, is referred to herein as the “Investment Company Act.” The","page_number":45,"box":{"x":68,"y":256,"width":801,"height":11}},{"id":"8e1f49e5-e3df-4380-86da-c2ab7c76b37f","block_type":"box","text":"Securities Act of 1933, as amended, is referred to herein as the “Securities Act.” The Securities and Exchange","page_number":45,"box":{"x":69,"y":271,"width":793,"height":12}},{"id":"26992e3e-294e-45ff-ac00-46c5f042ee2f","block_type":"box","text":"Commission is referred to herein as the “Commission” or the “SEC.”","page_number":45,"box":{"x":69,"y":286,"width":492,"height":10}},{"id":"34ee2c8f-2cb7-4a34-920d-eef056732be3","block_type":"box","text":"Cer tain Funds are “feeder” funds (each, a “Feeder Fund”) that invest all or a por tion of their assets in a","page_number":45,"box":{"x":102,"y":309,"width":741,"height":11}},{"id":"43ae9696-f87e-456d-ae31-598d16b0514c","block_type":"box","text":"corresponding “master” por tfolio (each, a “Master Por tfolio”) of a master limited liability company (each, a “Master","page_number":45,"box":{"x":69,"y":324,"width":824,"height":12}},{"id":"b7e13d75-c1a1-43f9-94f1-58e8327d51d3","block_type":"box","text":"LLC”), a mutual fund that has the same objective and strategies as the Feeder Fund. All investments are generally","page_number":45,"box":{"x":70,"y":339,"width":814,"height":12}},{"id":"058b7e1d-1926-4928-a75a-de8f7307c498","block_type":"box","text":"made at the level of the Master Por tfolio. This structure is sometimes called a “master/feeder” structure. A Feeder","page_number":45,"box":{"x":69,"y":355,"width":825,"height":11}},{"id":"e3e2699a-ad7f-4caa-9eb7-53586429466c","block_type":"box","text":"Fund’s investment results will correspond directly to the investment results of the underlying Master Por tfolio in","page_number":45,"box":{"x":70,"y":370,"width":795,"height":11}},{"id":"4aa1e2b9-5a52-4846-8873-28dfb155de1c","block_type":"box","text":"which it invests. For simplicity, this SAI uses the term “Fund” to include both a Feeder Fund and its Master Por tfolio.","page_number":45,"box":{"x":68,"y":385,"width":830,"height":11}},{"id":"a30b84b2-c639-4a1f-8ef1-65d4b80346b0","block_type":"box","text":"In addition to containing information about the Funds, Par t II of this SAI contains general information about all","page_number":45,"box":{"x":102,"y":407,"width":783,"height":12}},{"id":"42b6cde4-c4ad-45c1-8cd6-f147e9137803","block_type":"box","text":"funds in the BlackRock-advised fund complex. Cer tain information contained herein may not be relevant to a","page_number":45,"box":{"x":68,"y":423,"width":772,"height":11}},{"id":"8337b366-a928-44b8-925c-4ed1d7efba84","block_type":"box","text":"par ticular Fund.","page_number":45,"box":{"x":70,"y":438,"width":109,"height":11}},{"id":"f7a62758-730f-48b7-84ff-5a329fb08e03","block_type":"box","text":"INVESTMENT RISKS AND CONSIDERATIONS","page_number":45,"box":{"x":314,"y":467,"width":351,"height":10}},{"id":"597907ec-66b9-4e91-9275-883b8950dc01","block_type":"box","text":"Set for th below are descriptions of some of the types of investments and investment strategies that one or more","page_number":45,"box":{"x":102,"y":490,"width":805,"height":11}},{"id":"ba32ae40-83d8-4495-bc55-70fbe8f29735","block_type":"box","text":"of the Funds may use, and the risks and considerations associated with those investments and investment","page_number":45,"box":{"x":69,"y":505,"width":765,"height":11}},{"id":"143a3c70-c81c-4e14-8cdd-e8a4d4d0af90","block_type":"box","text":"strategies. Please see each Fund’s prospectuses (the “Prospectus”) and the “Investment Objective and Policies,”","page_number":45,"box":{"x":69,"y":520,"width":811,"height":12}},{"id":"659f73cf-15b4-44ff-8f81-d7a9e207b0f9","block_type":"box","text":"“Investment Objectives and Policies” or “Investment Strategies and Risks of the Fund” section, as applicable, of Par t","page_number":45,"box":{"x":70,"y":535,"width":837,"height":12}},{"id":"79bb5d73-28bc-4a54-aeb6-abd8a18d2ddb","block_type":"box","text":"I of this SAI for fur ther information on each Fund’s investment policies and risks. Information contained in this","page_number":45,"box":{"x":70,"y":550,"width":785,"height":11}},{"id":"17e42e2a-124b-4e74-8f47-b0b0754d7fb9","block_type":"box","text":"section about the risks and considerations associated with a Fund’s investments and/or investment strategies","page_number":45,"box":{"x":69,"y":566,"width":791,"height":11}},{"id":"6e91bd62-718c-40ba-97d4-8087bec56e39","block_type":"box","text":"applies only to those Funds specifically identified in Par t I of this SAI as making each type of investment or using","page_number":45,"box":{"x":69,"y":581,"width":805,"height":11}},{"id":"a0334495-f5e7-46ad-bdcd-ab7122f18ad0","block_type":"box","text":"each investment strategy (each, a “Covered Fund”). Information that does not apply to a Covered Fund does not form","page_number":45,"box":{"x":69,"y":596,"width":835,"height":11}},{"id":"2612e197-e1d4-416a-88ed-d12a9c339584","block_type":"box","text":"a par t of that Covered Fund’s SAI and should not be relied on by investors in that Covered Fund. Only information that","page_number":45,"box":{"x":69,"y":611,"width":840,"height":11}},{"id":"c675040d-5bf0-4ccd-867e-e84a22af69ac","block_type":"box","text":"is clearly identified as applicable to a Covered Fund is considered to form a par t of that Covered Fund’s SAI.","page_number":45,"box":{"x":70,"y":626,"width":770,"height":11}},{"id":"9b9bef48-d9ec-491a-8555-ee21d5017ee9","block_type":"box","text":"Asset-Backed Securities.","page_number":45,"box":{"x":101,"y":649,"width":183,"height":9}},{"id":"20d20c45-20e9-4cf5-88ba-2b2a8cc61988","block_type":"box","text":"Asset-backed securities are securities backed by home equity loans, installment sale","page_number":45,"box":{"x":290,"y":649,"width":607,"height":11}},{"id":"84905d1c-d837-4a07-b8de-63ae159c0e2b","block_type":"box","text":"contracts, credit card receivables or other assets. Asset-backed securities are “pass-through” securities, meaning","page_number":45,"box":{"x":69,"y":664,"width":814,"height":11}},{"id":"68324143-249d-4802-88ed-22a92fc00f1e","block_type":"box","text":"that principal and interest payments — net of expenses — made by the borrower on the underlying assets (such as","page_number":45,"box":{"x":68,"y":679,"width":825,"height":11}},{"id":"7b40f324-45d7-4081-9f77-eec4a4f60e50","block_type":"box","text":"credit card receivables) are passed through to a Fund. The value of asset-backed securities, like that of traditional","page_number":45,"box":{"x":69,"y":694,"width":813,"height":11}},{"id":"de916b98-60c8-4ea3-8c95-610b26f453a7","block_type":"box","text":"fixed-income securities, typically increases when interest rates fall and decreases when interest rates rise. However,","page_number":45,"box":{"x":68,"y":709,"width":830,"height":11}},{"id":"67612a05-f742-44f1-8a52-7771b1289da3","block_type":"box","text":"asset-backed securities differ from traditional fixed-income securities because of their potential for prepayment. The","page_number":45,"box":{"x":69,"y":724,"width":827,"height":11}},{"id":"12091130-fc4b-421d-9aa3-ef7a38494efb","block_type":"box","text":"price paid by a Fund for its asset-backed securities, the yield the Fund expects to receive from such securities and","page_number":45,"box":{"x":70,"y":739,"width":813,"height":12}},{"id":"4c060aed-5f73-43fe-8947-6b93eed577c5","block_type":"box","text":"the average life of the securities are based on a number of factors, including the anticipated rate of prepayment of","page_number":45,"box":{"x":68,"y":755,"width":818,"height":11}},{"id":"d7607c47-386d-4635-9a24-7f119b903ad9","block_type":"box","text":"the underlying assets. In a period of declining interest rates, borrowers may prepay the underlying assets more","page_number":45,"box":{"x":68,"y":770,"width":792,"height":11}},{"id":"4b8e7f46-00e7-4d56-85f4-16c128815ab2","block_type":"box","text":"quickly than anticipated, thereby reducing the yield to maturity and the average life of the asset-backed securities.","page_number":45,"box":{"x":69,"y":785,"width":811,"height":11}},{"id":"c6bb9aa3-9cf7-4253-89dc-91f4594ffbe7","block_type":"box","text":"Moreover, when a Fund reinvests the proceeds of a prepayment in these circumstances, it will likely receive a rate of","page_number":45,"box":{"x":70,"y":800,"width":832,"height":11}},{"id":"eaa3de0e-69ab-475d-a832-51be08e6c0de","block_type":"box","text":"interest that is lower than the rate on the security that was prepaid. To the extent that a Fund purchases asset","page_number":45,"box":{"x":70,"y":815,"width":792,"height":11}},{"id":"e354e985-15cd-4072-8881-b7a605408401","block_type":"box","text":"backed securities at a premium, prepayments may result in a loss to the extent of the premium paid. If a Fund buys","page_number":45,"box":{"x":69,"y":830,"width":825,"height":11}},{"id":"138174ed-0781-4218-9ba2-fb64860ebd20","block_type":"box","text":"such securities at a discount, both scheduled payments and unscheduled prepayments will increase current and total","page_number":45,"box":{"x":69,"y":846,"width":838,"height":10}},{"id":"25b985b0-ae93-48fb-bdfa-88d5b182e185","block_type":"box","text":"returns and unscheduled prepayments will also accelerate the recognition of income which, when distributed to","page_number":45,"box":{"x":69,"y":860,"width":793,"height":12}},{"id":"33622fc5-3489-402a-9627-7070b1908e04","block_type":"box","text":"shareholders, will be taxable as ordinary income. In a period of rising interest rates, prepayments of the underlying","page_number":45,"box":{"x":69,"y":875,"width":819,"height":12}},{"id":"77a63aea-32da-4e99-911f-6f54a29e9a2c","block_type":"box","text":"assets may occur at a slower than expected rate, creating maturity extension risk. This par ticular risk may effectively","page_number":45,"box":{"x":69,"y":891,"width":834,"height":11}},{"id":"f3f1f294-1f6a-4505-8f69-e32635f520a8","block_type":"box","text":"change a security that was considered shor t- or intermediate-term at the time of purchase into a longer term security.","page_number":45,"box":{"x":69,"y":906,"width":837,"height":11}},{"id":"34f1028d-544c-4e0b-a4c3-4c77f4b10778","block_type":"box","text":"II-1","page_number":45,"box":{"x":478,"y":943,"width":23,"height":9}},{"id":"71ab1ea3-6395-428e-b225-fc8e02c81ef5","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":45,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"07e641da-aeaa-492b-8ee1-a381f9e82b93","block_type":"box","text":"Since the value of longer-term securities generally fluctuates more widely in response to changes in interest rates","page_number":46,"box":{"x":69,"y":45,"width":810,"height":11}},{"id":"18970b72-65d3-4454-a1bb-28c73f105c61","block_type":"box","text":"than does the value of shor ter-term securities, maturity extension risk could increase the volatility of the Fund. When","page_number":46,"box":{"x":68,"y":60,"width":833,"height":11}},{"id":"3aedf2af-4374-445d-95f8-1c2e7d9ba962","block_type":"box","text":"interest rates decline, the value of an asset-backed security with prepayment features may not increase as much as","page_number":46,"box":{"x":70,"y":75,"width":827,"height":11}},{"id":"ad96260a-225a-44d6-9238-0ff7015a10f9","block_type":"box","text":"that of other fixed-income securities, and, as noted above, changes in market rates of interest may accelerate or","page_number":46,"box":{"x":68,"y":90,"width":805,"height":11}},{"id":"0c04fb03-6da8-4a44-9004-e97ee232b0e7","block_type":"box","text":"retard prepayments and thus affect maturities.","page_number":46,"box":{"x":69,"y":105,"width":333,"height":11}},{"id":"ad20140e-1eab-41b5-8eff-7b2e487bcaa3","block_type":"box","text":"Asset-Based Securities.","page_number":46,"box":{"x":101,"y":128,"width":173,"height":9}},{"id":"b2e3f96c-da2e-4ebf-9bc6-a29109aaccfc","block_type":"box","text":"Cer tain Funds may invest in debt, preferred or conver tible securities, the principal","page_number":46,"box":{"x":281,"y":128,"width":582,"height":11}},{"id":"b510fbbe-e402-43c1-b102-10936f3eac9c","block_type":"box","text":"amount, redemption terms or conversion terms of which are related to the market price of some natural resource","page_number":46,"box":{"x":69,"y":143,"width":808,"height":11}},{"id":"e90bb64f-3c60-4560-a0e2-dfde30c20308","block_type":"box","text":"asset such as gold bullion. These securities are referred to as “asset-based securities.” A Fund will purchase only","page_number":46,"box":{"x":69,"y":158,"width":815,"height":11}},{"id":"f7f30c5c-0ae0-4f29-a2b1-d857e33bc4f9","block_type":"box","text":"asset-based securities that are rated, or are issued by issuers that have outstanding debt obligations rated,","page_number":46,"box":{"x":69,"y":173,"width":769,"height":11}},{"id":"7a299bb9-12d0-41be-ab3b-657689a4176d","block_type":"box","text":"investment grade (for example, AAA, AA, A or BBB by S&P Global Ratings (“S&P”) or Fitch Ratings (“Fitch”), or Baa by","page_number":46,"box":{"x":70,"y":188,"width":833,"height":12}},{"id":"b0122d39-02c9-40b9-84b9-6660aa76a567","block_type":"box","text":"Moody’s Investors Service, Inc. (“Moody’s”) or commercial paper rated A-1 by S&P or Prime-1 by Moody’s) or by","page_number":46,"box":{"x":70,"y":203,"width":795,"height":12}},{"id":"76b2f275-46b8-4b2e-8c58-8c07e2908327","block_type":"box","text":"issuers that the Manager has determined to be of similar creditwor thiness. Obligations ranked in the four th highest","page_number":46,"box":{"x":70,"y":218,"width":824,"height":12}},{"id":"0cbc0b51-59da-4689-8102-2b317714beb4","block_type":"box","text":"rating category, while considered “investment grade,” may have cer tain speculative characteristics and may be more","page_number":46,"box":{"x":69,"y":234,"width":832,"height":11}},{"id":"272e8fd5-2cd3-4be2-b3a6-a25d57cb9e92","block_type":"box","text":"likely to be downgraded than securities rated in the three highest rating categories. If an asset-based security is","page_number":46,"box":{"x":70,"y":249,"width":797,"height":11}},{"id":"c9009750-a618-4291-93ce-99560e02fca5","block_type":"box","text":"backed by a bank letter of credit or other similar facility, the Manager may take such backing into account in","page_number":46,"box":{"x":69,"y":264,"width":768,"height":11}},{"id":"bd1caadb-709b-4741-849b-a6933296ee54","block_type":"box","text":"determining the creditwor thiness of the issuer. While the market prices for an asset-based security and the related","page_number":46,"box":{"x":69,"y":279,"width":819,"height":11}},{"id":"3b01797c-39a2-4cbf-8ecd-fc2edee42ab1","block_type":"box","text":"natural resource asset generally are expected to move in the same direction, there may not be per fect correlation in","page_number":46,"box":{"x":69,"y":294,"width":829,"height":11}},{"id":"d949d412-c08b-46c1-bdb1-05d13809c2e3","block_type":"box","text":"the two price movements. Asset-based securities may not be secured by a security interest in or claim on the","page_number":46,"box":{"x":68,"y":309,"width":780,"height":11}},{"id":"381343b0-4d28-49ec-a7c7-322891678b8f","block_type":"box","text":"underlying natural resource asset. The asset-based securities in which a Fund may invest may bear interest or pay","page_number":46,"box":{"x":69,"y":325,"width":815,"height":11}},{"id":"8823f940-c777-4199-804b-01851068802c","block_type":"box","text":"preferred dividends at below market (or even relatively nominal) rates. Cer tain asset-based securities may be payable","page_number":46,"box":{"x":70,"y":339,"width":837,"height":12}},{"id":"c67dc1d7-fcea-44cb-981a-655f51fef279","block_type":"box","text":"at maturity in cash at the stated principal amount or, at the option of the holder, directly in a stated amount of the","page_number":46,"box":{"x":69,"y":355,"width":812,"height":11}},{"id":"bc7e1f80-51d7-4bdb-9ed8-dadeb3195832","block_type":"box","text":"asset to which it is related. In such instance, because no Fund presently intends to invest directly in natural resource","page_number":46,"box":{"x":69,"y":370,"width":836,"height":11}},{"id":"11703c22-2260-468a-b356-bea3ae417b87","block_type":"box","text":"assets, a Fund would sell the asset-based security in the secondary market, to the extent one exists, prior to","page_number":46,"box":{"x":69,"y":385,"width":778,"height":11}},{"id":"e84c25ca-11f2-437f-b04e-885e1aa48eb2","block_type":"box","text":"maturity if the value of the stated amount of the asset exceeds the stated principal amount and thereby realize the","page_number":46,"box":{"x":69,"y":400,"width":819,"height":11}},{"id":"28cb5440-375e-4e93-8820-bb4b573eca5e","block_type":"box","text":"appreciation in the underlying asset.","page_number":46,"box":{"x":69,"y":415,"width":258,"height":11}},{"id":"a5f8af40-996a-481e-9f3b-7de863a35aeb","block_type":"box","text":"Precious Metal-Related Securities.","page_number":46,"box":{"x":102,"y":438,"width":243,"height":9}},{"id":"d629d992-6b23-4e3d-9be4-3a56a58bd68e","block_type":"box","text":"A Fund may invest in the equity and other securities of companies that","page_number":46,"box":{"x":351,"y":438,"width":503,"height":11}},{"id":"2a9b68cd-bbdc-4b22-8845-1eb84c19c5ef","block_type":"box","text":"explore for, extract, process or deal in precious metals (","page_number":46,"box":{"x":69,"y":453,"width":398,"height":11}},{"id":"ee2cb731-39f5-41b2-a9cf-3c131da8d2a2","block_type":"box","text":"e.g.","page_number":46,"box":{"x":469,"y":454,"width":25,"height":10}},{"id":"6ca04712-4744-4104-93bd-26e24855e479","block_type":"box","text":", gold, silver and platinum), and in asset-based securities","page_number":46,"box":{"x":497,"y":453,"width":407,"height":11}},{"id":"fecb04a1-ac33-43f9-87bf-6d67b88b0ee3","block_type":"box","text":"indexed to the value of such metals. Such securities may be purchased when they are believed to be attractively","page_number":46,"box":{"x":70,"y":468,"width":801,"height":11}},{"id":"d0b8b555-ed30-4f57-9a08-7de3cd141699","block_type":"box","text":"priced in relation to the value of a company’s precious metal-related assets or when the values of precious metals","page_number":46,"box":{"x":70,"y":483,"width":815,"height":11}},{"id":"e95f936c-0458-49aa-996e-4f8431019d39","block_type":"box","text":"are expected to benefit from inflationary pressure or other economic, political or financial uncer tainty or instability.","page_number":46,"box":{"x":69,"y":498,"width":815,"height":11}},{"id":"1dadd5e5-b8f7-4fb0-9e9b-1576706c2312","block_type":"box","text":"Based on historical experience, during periods of economic or financial instability the securities of companies","page_number":46,"box":{"x":70,"y":513,"width":779,"height":12}},{"id":"1a0f4ff0-e0a6-4829-a80b-8e8c6063ec26","block_type":"box","text":"involved in precious metals may be subject to extreme price fluctuations, reflecting the high volatility of precious","page_number":46,"box":{"x":70,"y":528,"width":799,"height":12}},{"id":"c4eab897-ff97-4ff2-92f1-359e443c86b7","block_type":"box","text":"metal prices during such periods. In addition, the instability of precious metal prices may result in volatile earnings of","page_number":46,"box":{"x":69,"y":543,"width":838,"height":12}},{"id":"0eb11552-2149-46ec-8ed6-11cb09d9bf3f","block_type":"box","text":"precious metal-related companies, which may, in turn, adversely affect the financial condition of such companies. The","page_number":46,"box":{"x":70,"y":559,"width":838,"height":11}},{"id":"17346f58-bbcc-445e-b181-76ae76c1b8f4","block_type":"box","text":"major producers of gold include the Republic of South Africa, Russia, Canada, the United States, Brazil and Australia.","page_number":46,"box":{"x":69,"y":574,"width":835,"height":11}},{"id":"291fdda0-7471-44bb-b16c-41094a4b7e2e","block_type":"box","text":"Sales of gold by Russia are largely unpredictable and often relate to political and economic considerations rather","page_number":46,"box":{"x":69,"y":589,"width":806,"height":11}},{"id":"04e9f337-6d65-4a78-afc0-34ef7f2f45d8","block_type":"box","text":"than to market forces. Economic, financial, social and political factors within South Africa may significantly affect","page_number":46,"box":{"x":68,"y":604,"width":805,"height":11}},{"id":"d87799ca-b01d-4cbe-a71f-df1feb5e76fa","block_type":"box","text":"South African gold production.","page_number":46,"box":{"x":69,"y":619,"width":213,"height":11}},{"id":"0d072e43-e390-49bd-8cac-644d093da85b","block_type":"box","text":"Borrowing and Leverage.","page_number":46,"box":{"x":102,"y":642,"width":179,"height":11}},{"id":"920d84a9-b72c-40e1-9c43-c40b766450dc","block_type":"box","text":"Each Fund may borrow as a temporary measure for extraordinary or emergency","page_number":46,"box":{"x":288,"y":642,"width":563,"height":11}},{"id":"633ee16d-ab84-40cc-b4a8-44582447872e","block_type":"box","text":"purposes, including to meet redemptions or to settle securities transactions. Cer tain Funds will not purchase","page_number":46,"box":{"x":70,"y":657,"width":777,"height":11}},{"id":"99faae41-cd51-4a6e-8380-3b8d5f048830","block_type":"box","text":"securities at any time when borrowings exceed 5% of their total assets, except (a) to honor prior commitments or","page_number":46,"box":{"x":69,"y":672,"width":806,"height":11}},{"id":"4862c0fa-c626-4a67-b045-ee85eee57a70","block_type":"box","text":"(b) to exercise subscription rights when outstanding borrowings have been obtained exclusively for settlements of","page_number":46,"box":{"x":69,"y":687,"width":810,"height":11}},{"id":"c7f84418-3937-43a4-8e42-8379a3a2881b","block_type":"box","text":"other securities transactions.","page_number":46,"box":{"x":69,"y":703,"width":207,"height":8}},{"id":"25f0b18e-1bc4-4ad9-ac50-811c5e8194db","block_type":"box","text":"Cer tain Funds may also borrow in order to make investments, to the extent disclosed in such Fund’s Prospectus.","page_number":46,"box":{"x":102,"y":725,"width":806,"height":11}},{"id":"3da05886-976f-4788-a4c1-c9a23d4fca55","block_type":"box","text":"The purchase of securities while borrowings are outstanding will have the effect of leveraging the Fund. Such","page_number":46,"box":{"x":68,"y":740,"width":776,"height":11}},{"id":"0c9c25f1-4dff-4fb5-8f1c-cd9ca29764b8","block_type":"box","text":"leveraging increases the Fund’s exposure to capital risk, and borrowed funds are subject to interest costs that will","page_number":46,"box":{"x":70,"y":755,"width":813,"height":11}},{"id":"f2772240-f444-4fa2-b0f2-a9dcc566eb0c","block_type":"box","text":"reduce net income. The use of leverage by a Fund creates an oppor tunity for greater total return, but, at the same","page_number":46,"box":{"x":69,"y":770,"width":813,"height":12}},{"id":"186a608b-d1ac-4806-a361-099dbdb1391c","block_type":"box","text":"time, creates special risks. For example, leveraging may exaggerate changes in the net asset value (“NAV”) of Fund","page_number":46,"box":{"x":68,"y":785,"width":823,"height":12}},{"id":"ca1c607e-afbf-4be4-b1aa-bccc76f801c4","block_type":"box","text":"shares and in the yield on the Fund’s por tfolio. Although the principal of such borrowings will be fixed, the Fund’s","page_number":46,"box":{"x":69,"y":801,"width":806,"height":11}},{"id":"d4f98655-04d6-4bb5-a8bf-afa597d0eeb2","block_type":"box","text":"assets may change in value during the time the borrowings are outstanding. Borrowings will create interest expenses","page_number":46,"box":{"x":69,"y":816,"width":835,"height":11}},{"id":"c2aa9b37-2b0d-46d4-ac7a-4879d0e98728","block_type":"box","text":"for the Fund that can exceed the income from the assets purchased with the borrowings. To the extent the income or","page_number":46,"box":{"x":68,"y":831,"width":835,"height":11}},{"id":"efe70124-4e45-4ab7-860a-5c78b1a840a2","block_type":"box","text":"capital appreciation derived from securities purchased with borrowed funds exceeds the interest the Fund will have to","page_number":46,"box":{"x":69,"y":846,"width":838,"height":11}},{"id":"9e10fa7b-6e70-46d7-9da3-fcebb0f6b081","block_type":"box","text":"pay on the borrowings, the Fund’s return will be greater than if leverage had not been used. Conversely, if the income","page_number":46,"box":{"x":70,"y":861,"width":835,"height":11}},{"id":"f15aea14-f1ac-412a-a397-7789c8db23cb","block_type":"box","text":"or capital appreciation from the securities purchased with such borrowed funds is not sufficient to cover the cost of","page_number":46,"box":{"x":69,"y":876,"width":825,"height":11}},{"id":"3df4c0e3-8dd7-4e2e-a9da-4dd5ddb698b7","block_type":"box","text":"borrowing, the return to the Fund will be less than if leverage had not been used and, therefore, the amount available","page_number":46,"box":{"x":69,"y":891,"width":837,"height":12}},{"id":"e18fe292-9590-41a7-b3d9-71fb14979f43","block_type":"box","text":"for distribution to shareholders as dividends will be reduced. In the latter case, the Manager in its best judgment","page_number":46,"box":{"x":68,"y":906,"width":805,"height":12}},{"id":"287e8829-6b0e-4712-871f-a1bb07ba5c5c","block_type":"box","text":"II-2","page_number":46,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"96a0e331-20a8-4e0f-bf7d-b92dece316e8","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":46,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"1cb7e23a-0d94-4d70-afbd-a876843a8f3d","block_type":"box","text":"never theless may determine to maintain the Fund’s leveraged position if it expects that the benefits to the Fund’s","page_number":47,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"a87cd531-c0b7-43f5-b91d-e1d3e40cdfd9","block_type":"box","text":"shareholders of maintaining the leveraged position will outweigh the current reduced return.","page_number":47,"box":{"x":69,"y":60,"width":653,"height":11}},{"id":"43513d3c-2201-447c-9eb1-64cee74eba9a","block_type":"box","text":"Cer tain types of borrowings by a Fund may result in the Fund being subject to covenants in credit agreements","page_number":47,"box":{"x":102,"y":82,"width":780,"height":12}},{"id":"fffa229f-c8c1-4df7-9b4d-4ade0c647950","block_type":"box","text":"relating to asset coverage, por tfolio composition requirements and other matters. It is not anticipated that","page_number":47,"box":{"x":69,"y":98,"width":759,"height":11}},{"id":"106c004b-aa81-49bc-a66b-7406241b9181","block_type":"box","text":"observance of such covenants would impede the Manager from managing a Fund’s por tfolio in accordance with the","page_number":47,"box":{"x":69,"y":113,"width":822,"height":11}},{"id":"51c51d92-d916-4358-bbaa-3b1c155493f0","block_type":"box","text":"Fund’s investment objectives and policies. However, a breach of any such covenants not cured within the specified","page_number":47,"box":{"x":70,"y":128,"width":816,"height":11}},{"id":"7309a50e-108f-4907-aefc-2d38504d8611","block_type":"box","text":"cure period may result in acceleration of outstanding indebtedness and require the Fund to dispose of por tfolio","page_number":47,"box":{"x":69,"y":143,"width":792,"height":11}},{"id":"e56bc557-a4b4-4525-a521-40d2f292d040","block_type":"box","text":"investments at a time when it may be disadvantageous to do so.","page_number":47,"box":{"x":70,"y":158,"width":459,"height":11}},{"id":"cd445d0a-a225-4487-9900-24f4ca2e7a66","block_type":"box","text":"Each Fund may at times borrow from affiliates of the Manager, provided that the terms of such borrowings are","page_number":47,"box":{"x":102,"y":181,"width":786,"height":11}},{"id":"cdc06d63-54b6-402e-b5c1-da54645cd1e8","block_type":"box","text":"no less favorable than those available from comparable sources of funds in the marketplace.","page_number":47,"box":{"x":69,"y":196,"width":663,"height":11}},{"id":"ba78e38c-f988-4617-9cab-fde44ea2097a","block_type":"box","text":"Cash Management.","page_number":47,"box":{"x":102,"y":219,"width":140,"height":11}},{"id":"01cf9a15-7a5e-434f-9f71-c71d8727c4d8","block_type":"box","text":"Generally, the Manager will employ futures and options on futures to provide liquidity","page_number":47,"box":{"x":249,"y":218,"width":603,"height":12}},{"id":"1c5cc158-a031-45c4-aa19-504a63cb1265","block_type":"box","text":"necessary to meet anticipated redemptions or for day-to-day operating purposes. However, if considered appropriate","page_number":47,"box":{"x":69,"y":234,"width":828,"height":11}},{"id":"b235dc14-f5e5-46e1-b3bf-49796165d172","block_type":"box","text":"in the opinion of the Manager, a por tion of a Fund’s assets may be invested in cer tain types of instruments with","page_number":47,"box":{"x":70,"y":249,"width":799,"height":11}},{"id":"e5ea1f26-44c7-4a74-b90f-007818b5ef2e","block_type":"box","text":"remaining maturities of 397 days or less for liquidity purposes. Such instruments would consist of: (i) obligations of","page_number":47,"box":{"x":69,"y":264,"width":826,"height":11}},{"id":"108f2973-72e9-47a9-99c6-c916860b6a6f","block_type":"box","text":"the U.S. Government, its agencies, instrumentalities, authorities or political subdivisions (“U.S. Government","page_number":47,"box":{"x":68,"y":279,"width":772,"height":11}},{"id":"80bde685-8d9a-43e6-9ed0-60dc07c9549e","block_type":"box","text":"Securities”); (ii) other fixed-income securities rated Aa or higher by Moody’s or AA or higher by S&P or, if unrated, of","page_number":47,"box":{"x":69,"y":294,"width":823,"height":11}},{"id":"c27af0a0-9fe6-4bc5-b071-63ce545fc5b7","block_type":"box","text":"comparable quality in the opinion of the Manager; (iii) commercial paper; (iv) bank obligations, including negotiable","page_number":47,"box":{"x":69,"y":309,"width":816,"height":11}},{"id":"8eb610b2-a113-4844-8890-dc62886f95fc","block_type":"box","text":"cer tificates of deposit, time deposits and bankers’ acceptances; and (v) repurchase agreements. At the time the","page_number":47,"box":{"x":69,"y":324,"width":804,"height":12}},{"id":"5a6ba1f3-b11a-4686-a3ad-37b80e456eeb","block_type":"box","text":"Fund invests in commercial paper, bank obligations or repurchase agreements, the issuer or the issuer’s parent must","page_number":47,"box":{"x":70,"y":340,"width":839,"height":11}},{"id":"2b3d36bb-0e8e-441e-a8f8-8df70eca3b83","block_type":"box","text":"have outstanding debt rated Aa or higher by Moody’s or AA or higher by S&P or outstanding commercial paper, bank","page_number":47,"box":{"x":69,"y":355,"width":824,"height":11}},{"id":"381ad304-fbac-4620-b417-2625e55d4c9a","block_type":"box","text":"obligations or other shor t-term obligations rated Prime-1 by Moody’s or A-1 by S&P; or, if no such ratings are","page_number":47,"box":{"x":69,"y":370,"width":771,"height":11}},{"id":"2e9ab89d-b702-4eef-b077-b1ff9ec4ae93","block_type":"box","text":"available, the instrument must be of comparable quality in the opinion of the Manager. For more information on","page_number":47,"box":{"x":69,"y":385,"width":793,"height":11}},{"id":"8976ef96-715a-42a9-9899-2750de8a75f6","block_type":"box","text":"money market instruments, see “Money Market Securities” below.","page_number":47,"box":{"x":69,"y":400,"width":472,"height":11}},{"id":"3b86838b-0797-44c4-b55e-58b137ec9c75","block_type":"box","text":"Collateralized Debt Obligations.","page_number":47,"box":{"x":102,"y":423,"width":229,"height":11}},{"id":"69fc49a4-55b6-47a8-878c-b77b33c16c79","block_type":"box","text":"Cer tain Funds may invest in collateralized debt obligations (“CDOs”), which","page_number":47,"box":{"x":337,"y":423,"width":534,"height":11}},{"id":"818936a8-6e13-45df-9f27-8170e5dbb7ad","block_type":"box","text":"include collateralized bond obligations (“CBOs”), collateralized loan obligations (“CLOs”) and other similarly","page_number":47,"box":{"x":70,"y":438,"width":764,"height":11}},{"id":"f3ad2e92-b6f2-439b-a301-852c4d61a26f","block_type":"box","text":"structured securities. CDOs are types of asset-backed securities. A CBO is ordinarily issued by a trust or other","page_number":47,"box":{"x":69,"y":453,"width":787,"height":11}},{"id":"0cec02a0-8d7e-4d83-930a-4f7b7618504e","block_type":"box","text":"special purpose entity (“SPE”) and is typically backed by a diversified pool of fixed-income securities (which may","page_number":47,"box":{"x":69,"y":468,"width":797,"height":11}},{"id":"61fa2f19-22f3-4ff1-b3a7-6edb5c5fc41a","block_type":"box","text":"include high risk, below investment grade securities) held by such issuer. A CLO is ordinarily issued by a trust or","page_number":47,"box":{"x":70,"y":483,"width":798,"height":11}},{"id":"909cc00d-7176-433e-8671-a0269cd09d8b","block_type":"box","text":"other SPE and is typically collateralized by a pool of loans, which may include, among others, domestic and non-U.S.","page_number":47,"box":{"x":69,"y":498,"width":827,"height":11}},{"id":"f505c71c-bfb5-4815-9b0d-61546c3d33cc","block_type":"box","text":"senior secured loans, senior unsecured loans, and subordinate corporate loans, including loans that may be rated","page_number":47,"box":{"x":69,"y":514,"width":814,"height":11}},{"id":"9ca1cbf4-f852-42ff-9a31-fc1c3e2466c4","block_type":"box","text":"below investment grade or equivalent unrated loans, held by such issuer. Investments in a CLO organized outside of","page_number":47,"box":{"x":69,"y":528,"width":828,"height":12}},{"id":"3ae4eefd-4029-45a5-b38c-c1fb59fae4c3","block_type":"box","text":"the United States may not be deemed to be foreign securities if the CLO is collateralized by a pool of loans, a","page_number":47,"box":{"x":68,"y":543,"width":782,"height":12}},{"id":"ba1443b8-a2ad-4fff-b96a-3769a07c801c","block_type":"box","text":"substantial por tion of which are U.S. loans. Although cer tain CDOs may benefit from credit enhancement in the form","page_number":47,"box":{"x":69,"y":559,"width":830,"height":11}},{"id":"cb4935b8-c246-4e98-9034-ff8956f7bf0a","block_type":"box","text":"of a senior-subordinate structure, over-collateralization or bond insurance, such enhancement may not always be","page_number":47,"box":{"x":69,"y":574,"width":803,"height":11}},{"id":"d794b659-d335-4f26-817c-27bc89bb02a4","block_type":"box","text":"present, and may fail to protect a Fund against the risk of loss on default of the collateral. Cer tain CDO issuers may","page_number":47,"box":{"x":70,"y":589,"width":827,"height":11}},{"id":"b380bf3f-e12f-4248-a5a8-c7fa933703be","block_type":"box","text":"use derivatives contracts to create “synthetic” exposure to assets rather than holding such assets directly, which","page_number":47,"box":{"x":69,"y":604,"width":807,"height":11}},{"id":"0d2fe41a-1b99-4c36-9c42-1f4741fbb120","block_type":"box","text":"entails the risks of derivative instruments described elsewhere in this SAI. CDOs may charge management fees and","page_number":47,"box":{"x":69,"y":619,"width":826,"height":11}},{"id":"73f5c23e-b79f-4e99-8d58-a7f5091b6dd8","block_type":"box","text":"administrative expenses, which are in addition to those of a Fund.","page_number":47,"box":{"x":69,"y":634,"width":469,"height":11}},{"id":"3b6bc785-dccb-419e-9cde-1f0d1c5d1161","block_type":"box","text":"For both CBOs and CLOs, the cash flows from the SPE are split into two or more por tions, called tranches,","page_number":47,"box":{"x":102,"y":657,"width":758,"height":11}},{"id":"81bdd4dd-1f62-4473-b4aa-3f373599ba86","block_type":"box","text":"varying in risk and yield. The riskiest por tion is the “equity” tranche, which bears the first loss from defaults from the","page_number":47,"box":{"x":68,"y":672,"width":836,"height":11}},{"id":"ffab1b35-e466-422f-8ea8-402de2ac7ebc","block_type":"box","text":"bonds or loans in the SPE and serves to protect the other, more senior tranches from default (though such protection","page_number":47,"box":{"x":69,"y":687,"width":838,"height":11}},{"id":"2ee90fdf-74ec-440e-8ac1-df9f78e28397","block_type":"box","text":"is not complete). Since it is par tially protected from defaults, a senior tranche from a CBO or CLO typically has higher","page_number":47,"box":{"x":70,"y":702,"width":835,"height":12}},{"id":"2b3ee3d1-7289-4370-9021-5d2a09674994","block_type":"box","text":"ratings and lower yields than its underlying securities, and may be rated investment grade. Despite the protection","page_number":47,"box":{"x":69,"y":718,"width":808,"height":11}},{"id":"0d36e64c-7336-4b05-b9c0-3fcab8c3af3d","block_type":"box","text":"from the equity tranche, CBO or CLO tranches can experience substantial losses due to actual defaults, downgrades","page_number":47,"box":{"x":68,"y":732,"width":830,"height":12}},{"id":"0fe70b3f-3c4c-492f-a584-b3bc8b183697","block_type":"box","text":"of the underlying collateral by rating agencies, forced liquidation of the collateral pool due to a failure of coverage","page_number":47,"box":{"x":69,"y":748,"width":806,"height":11}},{"id":"a1d96993-b503-40bb-840a-e3a275f47b4b","block_type":"box","text":"tests, increased sensitivity to defaults due to collateral default and disappearance of protecting tranches, market","page_number":47,"box":{"x":68,"y":763,"width":809,"height":11}},{"id":"ba34791a-ace5-4eab-b8b2-a615db231501","block_type":"box","text":"anticipation of defaults as well as investor aversion to CBO or CLO securities as a class. Interest on cer tain tranches","page_number":47,"box":{"x":69,"y":778,"width":835,"height":11}},{"id":"85072f6d-71e5-4a5b-a6e6-91fcee757bf3","block_type":"box","text":"of a CDO may be paid in kind or deferred and capitalized (paid in the form of obligations of the same type rather than","page_number":47,"box":{"x":69,"y":793,"width":835,"height":11}},{"id":"155e117c-1e6d-4e7a-8f3f-9467f7ceb508","block_type":"box","text":"cash), which involves continued exposure to default risk with respect to such payments.","page_number":47,"box":{"x":69,"y":808,"width":625,"height":11}},{"id":"7d45695f-e61e-40bd-bceb-7b2d48a395fb","block_type":"box","text":"The risks of an investment in a CDO depend largely on the type of the collateral securities and the class of the","page_number":47,"box":{"x":101,"y":831,"width":789,"height":11}},{"id":"435cbc40-df0c-4e01-9d77-e938233327ce","block_type":"box","text":"CDO in which a Fund invests. Normally, CBOs, CLOs and other CDOs are privately offered and sold, and thus are not","page_number":47,"box":{"x":69,"y":846,"width":830,"height":11}},{"id":"86c05312-a76c-4374-bf48-0a876738ceba","block_type":"box","text":"registered under the securities laws. However, an active dealer market may exist for CDOs, allowing a CDO to qualify","page_number":47,"box":{"x":69,"y":861,"width":830,"height":11}},{"id":"13fbbff4-1a9b-4b4f-b28f-d0e65fe851c8","block_type":"box","text":"for Rule 144A transactions. In addition to the normal risks associated with fixed-income securities and asset-backed","page_number":47,"box":{"x":68,"y":876,"width":831,"height":9}},{"id":"651a806c-5528-44c9-91c9-b434ce9b3077","block_type":"box","text":"securities generally discussed elsewhere in this SAI, CDOs carry additional risks including, but not limited to: (i) the","page_number":47,"box":{"x":69,"y":891,"width":824,"height":12}},{"id":"5b2af37f-b690-4b68-a7cd-45eb540acb61","block_type":"box","text":"possibility that distributions from collateral securities will not be adequate to make interest or other payments; (ii) the","page_number":47,"box":{"x":70,"y":906,"width":838,"height":12}},{"id":"3b113d0d-328c-4b08-a2b6-18628654ee44","block_type":"box","text":"II-3","page_number":47,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"14ee21fb-e4c5-4425-86a2-0c486bc30395","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":47,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"abef61d9-4808-41ca-9500-435d92cb772d","block_type":"box","text":"risk that the collateral may default or decline in value or be downgraded, if rated by a nationally recognized statistical","page_number":48,"box":{"x":69,"y":45,"width":832,"height":11}},{"id":"c552d8a2-6bd7-40de-bd36-5282cbe47e4a","block_type":"box","text":"rating organization (“NRSRO”); (iii) a Fund may invest in tranches of CDOs that are subordinate to other tranches;","page_number":48,"box":{"x":69,"y":60,"width":807,"height":11}},{"id":"2a55b533-643d-4ebf-a5cf-5e94109db4b7","block_type":"box","text":"(iv) the structure and complexity of the transaction and the legal documents could lead to disputes among investors","page_number":48,"box":{"x":69,"y":75,"width":826,"height":11}},{"id":"b36a6d71-304f-4e84-8cca-48b24a8d28ac","block_type":"box","text":"regarding the characterization of proceeds; (v) the investment return achieved by the Fund could be significantly","page_number":48,"box":{"x":69,"y":90,"width":795,"height":11}},{"id":"41949dd3-23f3-40fa-bfd5-c5e7c350083d","block_type":"box","text":"different than those predicted by financial models; (vi) the lack of a readily available secondary market for CDOs;","page_number":48,"box":{"x":69,"y":105,"width":804,"height":11}},{"id":"d6566b0a-5600-48a3-bba9-51ce0319c54c","block_type":"box","text":"(vii) the risk of forced “fire sale” liquidation due to technical defaults such as coverage test failures; and (viii) the","page_number":48,"box":{"x":69,"y":120,"width":805,"height":12}},{"id":"716c7a95-17a4-47f0-9280-fbfa213aa8e2","block_type":"box","text":"CDO’s manager may per form poorly.","page_number":48,"box":{"x":69,"y":135,"width":257,"height":12}},{"id":"bf81f51a-d497-4f1d-9a60-181d04594945","block_type":"box","text":"Commercial Paper.","page_number":48,"box":{"x":102,"y":158,"width":136,"height":11}},{"id":"5ad90f55-67f3-4f4a-8b6a-0ef9c988b40f","block_type":"box","text":"Cer tain Funds may purchase commercial paper. Commercial paper purchasable by each","page_number":48,"box":{"x":244,"y":158,"width":626,"height":11}},{"id":"158bbd6a-e6bf-40d3-b20a-c89a911807c2","block_type":"box","text":"Fund includes “Section 4(a)(2) paper,” a term that includes debt obligations issued in reliance on the “private","page_number":48,"box":{"x":70,"y":173,"width":781,"height":11}},{"id":"49e46bb3-589e-4d12-b142-a0b84f7346c4","block_type":"box","text":"placement” exemption from registration afforded by Section 4(a)(2) of the Securities Act. Section 4(a)(2) paper is","page_number":48,"box":{"x":70,"y":188,"width":806,"height":12}},{"id":"aed391d0-669b-4829-b235-cdca8683f7e3","block_type":"box","text":"restricted as to disposition under the Federal securities laws, and is frequently sold (and resold) to institutional","page_number":48,"box":{"x":69,"y":203,"width":792,"height":12}},{"id":"042331cc-f530-4582-8fe2-93e596f99c24","block_type":"box","text":"investors such as the Fund through or with the assistance of investment dealers who make a market in the Section","page_number":48,"box":{"x":70,"y":218,"width":820,"height":12}},{"id":"5ebd0a55-c918-4d3d-bf52-331ba5bff119","block_type":"box","text":"4(a)(2) paper, thereby providing liquidity. Cer tain transactions in Section 4(a)(2) paper may qualify for the registration","page_number":48,"box":{"x":69,"y":234,"width":831,"height":11}},{"id":"d14ee5e3-8dd1-4b4f-9891-04664b6364b9","block_type":"box","text":"exemption provided in Rule 144A under the Securities Act. Most Funds can purchase commercial paper rated (at the","page_number":48,"box":{"x":69,"y":249,"width":831,"height":11}},{"id":"d40d3964-2764-418e-a344-bc071698164f","block_type":"box","text":"time of purchase) “A-1” by S&P or “Prime-1” by Moody’s or when deemed advisable by a Fund’s Manager or sub","page_number":48,"box":{"x":68,"y":264,"width":805,"height":11}},{"id":"bc18cffe-7894-4373-941f-bda67b79baa9","block_type":"box","text":"adviser, “high quality” issues rated “A-2”, “Prime-2” or “F-2” by S&P, Moody’s or Fitch, respectively.","page_number":48,"box":{"x":69,"y":279,"width":707,"height":11}},{"id":"5cbc2efb-2cf5-453a-b026-4fd870eff0de","block_type":"box","text":"Commercial paper is generally considered to be shor t-term unsecured debt of corporations. Like all fixed income","page_number":48,"box":{"x":102,"y":302,"width":801,"height":11}},{"id":"f8cfcb4f-8df8-4756-b0bb-46cb5e334e23","block_type":"box","text":"securities, commercial paper prices are susceptible to fluctuations in interest rates. If interest rates rise, commercial","page_number":48,"box":{"x":69,"y":317,"width":836,"height":11}},{"id":"ba47c91f-8690-4694-b96a-c071ea68ac74","block_type":"box","text":"paper prices will decline and vice versa. However, the shor t-term nature of a commercial paper investment generally","page_number":48,"box":{"x":70,"y":332,"width":826,"height":11}},{"id":"e16ca254-22f2-407b-a4d9-c6fd5aa83ee6","block_type":"box","text":"makes it less susceptible to volatility than many other fixed income securities because interest rate risk typically","page_number":48,"box":{"x":69,"y":347,"width":803,"height":11}},{"id":"63d37be2-4e5c-405b-9d03-194539d5f0e9","block_type":"box","text":"increases as maturity lengths increase. Commercial paper tends to yield smaller returns than longer-term corporate","page_number":48,"box":{"x":70,"y":362,"width":822,"height":11}},{"id":"353f35ac-b89a-4996-b477-52d2cf5e0fbe","block_type":"box","text":"debt because securities with shor ter maturities typically have lower effective yields than those with longer maturities.","page_number":48,"box":{"x":69,"y":377,"width":835,"height":12}},{"id":"f79bb9f0-12d0-4e72-92d5-dd2cf3e5a1f8","block_type":"box","text":"Commodity-Linked Derivative Instruments and Hybrid Instruments.","page_number":48,"box":{"x":102,"y":400,"width":483,"height":11}},{"id":"5066340f-fe21-4c5e-9dc6-20ad22db31ef","block_type":"box","text":"Cer tain Funds seek to gain exposure to the","page_number":48,"box":{"x":591,"y":400,"width":308,"height":11}},{"id":"1f723447-20a4-47f3-8f61-953867429bc8","block_type":"box","text":"commodities markets primarily through investments in hybrid instruments. Hybrid instruments are either equity or","page_number":48,"box":{"x":69,"y":415,"width":809,"height":11}},{"id":"a85ecc3e-bb8f-407a-8213-7f31fb10b472","block_type":"box","text":"debt derivative securities with one or more commodity-dependent components that have payment features similar to","page_number":48,"box":{"x":69,"y":430,"width":828,"height":11}},{"id":"6196ceb9-3321-4d62-a1d0-f971d33c2686","block_type":"box","text":"a commodity futures contract, a commodity option contract, or a combination of both. Therefore, these instruments","page_number":48,"box":{"x":69,"y":445,"width":822,"height":11}},{"id":"a5bde1c0-9a17-4d75-bc8b-344dc65ecb62","block_type":"box","text":"are “commodity-linked.” They are considered “hybrid” instruments because they have both commodity-like and","page_number":48,"box":{"x":69,"y":461,"width":787,"height":11}},{"id":"11e3afcd-1e15-4aa9-b72b-4b6c8fb1850f","block_type":"box","text":"security-like characteristics. Hybrid instruments are derivative instruments because at least par t of their value is","page_number":48,"box":{"x":69,"y":475,"width":801,"height":12}},{"id":"6472c4da-c4fc-4494-9f36-14e749c1f3e0","block_type":"box","text":"derived from the value of an underlying commodity, futures contract, index or other readily measurable economic","page_number":48,"box":{"x":69,"y":491,"width":800,"height":11}},{"id":"3ce28fd6-4f2c-46f7-9271-ae53ed277e49","block_type":"box","text":"variable.","page_number":48,"box":{"x":68,"y":506,"width":59,"height":9}},{"id":"65acca2b-0327-4266-825e-9d4423b0c085","block_type":"box","text":"The prices of commodity-linked derivative instruments may move in different directions than investments in","page_number":48,"box":{"x":101,"y":528,"width":763,"height":12}},{"id":"7d7a7c5e-4bbe-4100-be70-230f5fa3f732","block_type":"box","text":"traditional equity and debt securities when the value of those traditional securities is declining due to adverse","page_number":48,"box":{"x":68,"y":543,"width":783,"height":12}},{"id":"fd00f506-f9b6-41b6-b3f3-edc73b7bd80d","block_type":"box","text":"economic conditions. As an example, during periods of rising inflation, debt securities have historically tended to","page_number":48,"box":{"x":69,"y":559,"width":802,"height":11}},{"id":"57914d08-b465-4cb0-8190-59d1ed9e2290","block_type":"box","text":"decline in value due to the general increase in prevailing interest rates. Conversely, during those same periods of","page_number":48,"box":{"x":69,"y":574,"width":808,"height":11}},{"id":"6a1128af-d011-4bd5-b578-80094e02cb72","block_type":"box","text":"rising inflation, the prices of cer tain commodities, such as oil and metals, have historically tended to increase. Of","page_number":48,"box":{"x":69,"y":589,"width":811,"height":11}},{"id":"33436ead-aceb-4162-a23d-a2d2cb55fd59","block_type":"box","text":"course, there cannot be any guarantee that these investments will per form in that manner in the future, and at","page_number":48,"box":{"x":69,"y":604,"width":791,"height":11}},{"id":"208e0700-7f23-4a25-bb30-f857e27effdb","block_type":"box","text":"cer tain times the price movements of commodity-linked instruments have been parallel to those of debt and equity","page_number":48,"box":{"x":69,"y":619,"width":819,"height":11}},{"id":"81666668-fb36-4261-9a9b-1c28945f0d15","block_type":"box","text":"securities. Commodities have historically tended to increase and decrease in value during different par ts of the","page_number":48,"box":{"x":69,"y":634,"width":795,"height":12}},{"id":"5d5804e0-02b6-440b-9895-93ad532724c7","block_type":"box","text":"business cycle than financial assets. Never theless, at various times, commodities prices may move in tandem with","page_number":48,"box":{"x":69,"y":649,"width":822,"height":12}},{"id":"4b2b6db3-4224-42b0-84ae-71221a496849","block_type":"box","text":"the prices of financial assets and thus may not provide overall por tfolio diversification benefits. Under favorable","page_number":48,"box":{"x":68,"y":664,"width":797,"height":12}},{"id":"419c7346-75b5-4eac-84b0-5fbb8d58db39","block_type":"box","text":"economic conditions, the Fund’s investments may be expected to under-per form an investment in traditional","page_number":48,"box":{"x":69,"y":680,"width":772,"height":11}},{"id":"a8a15931-6020-4f02-b354-4c2e541825c2","block_type":"box","text":"securities. Over the long term, the returns on the Fund’s investments are expected to exhibit low or negative","page_number":48,"box":{"x":69,"y":695,"width":773,"height":11}},{"id":"fd40a0bb-3d66-46ae-a756-c5d20e7daa4b","block_type":"box","text":"correlation with stocks and bonds.","page_number":48,"box":{"x":69,"y":710,"width":244,"height":9}},{"id":"c069b2ec-f2b9-468e-8198-3d58ed129b64","block_type":"box","text":"Qualifying Hybrid Instruments.","page_number":48,"box":{"x":102,"y":732,"width":212,"height":12}},{"id":"0d52995a-57ae-4cc5-8013-e4d187a4691f","block_type":"box","text":"Cer tain Funds may invest in hybrid instruments that qualify for exclusion from","page_number":48,"box":{"x":320,"y":732,"width":552,"height":12}},{"id":"feca14c1-935c-4171-b59b-72c8fadb6894","block_type":"box","text":"regulation under the Commodity Exchange Act and the regulations adopted thereunder. A hybrid instrument that","page_number":48,"box":{"x":69,"y":748,"width":795,"height":11}},{"id":"bcaa4747-57b0-4dc9-aca2-aa0b298d6b03","block_type":"box","text":"qualifies for this exclusion from regulation must be “predominantly a security.” A hybrid instrument is considered to","page_number":48,"box":{"x":69,"y":763,"width":822,"height":11}},{"id":"80705e24-a243-4b90-a9c8-22f676e40feb","block_type":"box","text":"be predominantly a security if (a) the issuer of the hybrid instrument receives payment in full of the purchase price of","page_number":48,"box":{"x":69,"y":778,"width":834,"height":11}},{"id":"92ef6e1e-dd9e-4d7a-98c0-a047ee87697f","block_type":"box","text":"the hybrid instrument, substantially contemporaneously with delivery of the hybrid instrument; (b) the purchaser or","page_number":48,"box":{"x":68,"y":793,"width":816,"height":11}},{"id":"0c54884e-346d-413a-9019-68d9338dad6a","block_type":"box","text":"holder of the hybrid instrument is not required to make any payment to the issuer in addition to the purchase price","page_number":48,"box":{"x":69,"y":808,"width":817,"height":11}},{"id":"43d0d7ec-81d3-4163-9646-2735d4888439","block_type":"box","text":"paid under subparagraph (a), whether as margin, settlement payment, or otherwise, during the life of the hybrid","page_number":48,"box":{"x":70,"y":823,"width":793,"height":12}},{"id":"ff04bcaf-8c1d-4b0d-b2ab-2e2d1cfc6e33","block_type":"box","text":"instrument or at maturity; (c) the issuer of the hybrid instrument is not subject by the terms of the instrument to","page_number":48,"box":{"x":70,"y":838,"width":798,"height":11}},{"id":"86355657-e601-4177-8d89-6a4d21317ba5","block_type":"box","text":"mark-to-market margining requirements; and (d) the hybrid instrument is not marketed as a contract of sale of a","page_number":48,"box":{"x":69,"y":853,"width":797,"height":12}},{"id":"6f6cab20-0b91-479c-afe1-9962c427553b","block_type":"box","text":"commodity for future delivery (or option on such a contract) subject to applicable provisions of the Commodity","page_number":48,"box":{"x":69,"y":869,"width":783,"height":11}},{"id":"3000eec4-e082-4b80-aeeb-27035af28c0b","block_type":"box","text":"Exchange Act. Hybrid instruments may be principal protected, par tially protected, or offer no principal protection. A","page_number":48,"box":{"x":70,"y":884,"width":816,"height":11}},{"id":"73314054-0eb5-416c-b95f-f3caa225ae4b","block_type":"box","text":"principal protected hybrid instrument means that the issuer will pay, at a minimum, the par value of the note at","page_number":48,"box":{"x":70,"y":899,"width":791,"height":11}},{"id":"9d905fbc-55c4-487f-ad72-716ddd835c55","block_type":"box","text":"II-4","page_number":48,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"ac181f43-c006-4bdc-bc5a-d8318cd21026","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":48,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"12c546b6-4a93-475c-9ed7-75d68ca7d139","block_type":"box","text":"maturity. Therefore, if the commodity value to which the hybrid instrument is linked declines over the life of the note,","page_number":49,"box":{"x":69,"y":45,"width":829,"height":11}},{"id":"7d62c213-1c75-4509-8c48-045e6031ff5f","block_type":"box","text":"the Fund will receive at maturity the face or stated value of the note. With a principal protected hybrid instrument, the","page_number":49,"box":{"x":68,"y":60,"width":837,"height":11}},{"id":"97a9b44f-ef45-4244-8268-812ac2620e97","block_type":"box","text":"Fund will receive at maturity the greater of the par value of the note or the increase in its value based on the","page_number":49,"box":{"x":70,"y":75,"width":772,"height":11}},{"id":"7b7cdbfd-d311-48c2-806b-37b7a24d37ad","block_type":"box","text":"underlying commodity or index. This protection is, in effect, an option whose value is subject to the volatility and price","page_number":49,"box":{"x":69,"y":90,"width":839,"height":11}},{"id":"b5d30d8c-88fe-4b75-b0f8-0fc9c590cb63","block_type":"box","text":"level of the underlying commodity. The Manager’s decision whether to use principal protection depends in par t on the","page_number":49,"box":{"x":70,"y":105,"width":835,"height":11}},{"id":"430f0203-f94f-4da9-93f6-da93063610ea","block_type":"box","text":"cost of the protection. In addition, the protection feature depends upon the ability of the issuer to meet its obligation","page_number":49,"box":{"x":69,"y":120,"width":833,"height":12}},{"id":"39b7e37d-2160-4e53-8340-a90dc5fa2e88","block_type":"box","text":"to buy back the security, and, therefore, depends on the creditwor thiness of the issuer. With full principal protection,","page_number":49,"box":{"x":68,"y":135,"width":831,"height":11}},{"id":"b198319b-5d01-4da3-b039-7157f721e0da","block_type":"box","text":"the Fund will receive at maturity of the hybrid instrument either the stated par value of the hybrid instrument, or","page_number":49,"box":{"x":68,"y":150,"width":795,"height":12}},{"id":"39fe0ad8-f67f-4be2-b46f-23efe7343d7e","block_type":"box","text":"potentially, an amount greater than the stated par value if the underlying commodity, index, futures contract or","page_number":49,"box":{"x":70,"y":166,"width":784,"height":11}},{"id":"803108a0-3ccb-4e65-b03a-cfbe9835693a","block_type":"box","text":"economic variable to which the hybrid instrument is linked has increased in value. Par tially protected hybrid","page_number":49,"box":{"x":69,"y":181,"width":765,"height":11}},{"id":"524321a7-ec5a-47a3-a3ba-832a99410f05","block_type":"box","text":"instruments may suffer some loss of principal if the underlying commodity, index, futures contract or economic","page_number":49,"box":{"x":70,"y":196,"width":788,"height":11}},{"id":"8462c383-61f5-4097-bb4d-28b517194df0","block_type":"box","text":"variable to which the hybrid instrument is linked declines in value during the term of the hybrid instrument. However,","page_number":49,"box":{"x":68,"y":211,"width":828,"height":11}},{"id":"18a11775-91e2-4a7e-9830-10d22462c77a","block_type":"box","text":"par tially protected hybrid instruments have a specified limit as to the amount of principal that they may lose.","page_number":49,"box":{"x":70,"y":226,"width":773,"height":11}},{"id":"b24415cc-4f77-450e-943b-d60bdbe2e7b0","block_type":"box","text":"Hybrid Instruments Without Principal Protection.","page_number":49,"box":{"x":102,"y":249,"width":339,"height":11}},{"id":"400a0c55-892e-45bb-97f4-2df2ee9d2627","block_type":"box","text":"Cer tain Funds may invest in hybrid instruments that offer no","page_number":49,"box":{"x":448,"y":249,"width":429,"height":11}},{"id":"64231630-da8a-41d1-9da8-b6300298a992","block_type":"box","text":"principal protection. At maturity, there is a risk that the underlying commodity price, futures contract, index or other","page_number":49,"box":{"x":70,"y":264,"width":818,"height":11}},{"id":"bfbc49a9-ea46-4525-870a-b74cd2406bce","block_type":"box","text":"economic variable may have declined sufficiently in value such that some or all of the face value of the hybrid","page_number":49,"box":{"x":69,"y":279,"width":780,"height":11}},{"id":"1d21fa61-c1b8-4f3f-b493-8d88f829a990","block_type":"box","text":"instrument might not be returned. The Manager, at its discretion, may invest in a par tially protected principal","page_number":49,"box":{"x":70,"y":294,"width":773,"height":11}},{"id":"b831a1c6-e182-49c0-9778-464b8e63bdce","block_type":"box","text":"structured note or a note without principal protection. In deciding to purchase a note without principal protection, the","page_number":49,"box":{"x":69,"y":309,"width":832,"height":11}},{"id":"7f0b8416-6226-4aa2-9a20-b328ec630fa1","block_type":"box","text":"Manager may consider, among other things, the expected per formance of the underlying commodity futures contract,","page_number":49,"box":{"x":70,"y":324,"width":831,"height":12}},{"id":"cb6168b4-5401-4979-8379-91d10bf9313b","block_type":"box","text":"index or other economic variable over the term of the note, the cost of the note, and any other economic factors that","page_number":49,"box":{"x":70,"y":339,"width":831,"height":12}},{"id":"50f0e8d4-74a7-4c83-b683-dedcd9c4e23e","block_type":"box","text":"the Manager believes are relevant.","page_number":49,"box":{"x":68,"y":355,"width":247,"height":11}},{"id":"4d504196-de17-4a89-9b31-ddf3ff09b5d5","block_type":"box","text":"Limitations on Leverage.","page_number":49,"box":{"x":102,"y":377,"width":173,"height":12}},{"id":"62f5ce6d-32a8-4b36-8a39-1bffea522946","block_type":"box","text":"Some of the hybrid instruments in which a Fund may invest may involve leverage. To","page_number":49,"box":{"x":281,"y":377,"width":598,"height":12}},{"id":"a1e067de-b5a6-4966-beb9-96788d4bbcea","block_type":"box","text":"avoid being subject to undue leverage risk, a Fund will seek to limit the amount of economic leverage it has under any","page_number":49,"box":{"x":69,"y":392,"width":840,"height":12}},{"id":"1a0be118-aa2d-4855-9262-6f6934889e35","block_type":"box","text":"one hybrid instrument that it buys and the leverage of the Fund’s overall por tfolio. A Fund will not invest in a hybrid","page_number":49,"box":{"x":69,"y":407,"width":816,"height":12}},{"id":"468d968b-fa6d-4146-b267-6cc481455e04","block_type":"box","text":"instrument if, at the time of purchase: (i) that instrument’s “leverage ratio” exceeds 300% of the price increase in","page_number":49,"box":{"x":70,"y":423,"width":812,"height":11}},{"id":"f84d4201-cfb9-4e6d-8505-c91cc4813b9e","block_type":"box","text":"the underlying commodity, futures contract, index or other economic variable or (ii) the Fund’s “por tfolio leverage","page_number":49,"box":{"x":68,"y":438,"width":803,"height":11}},{"id":"fe51964d-e269-4126-bee6-f74cae02b996","block_type":"box","text":"ratio” exceeds 150%, measured at the time of purchase. “Leverage ratio” is the expected increase in the value of a","page_number":49,"box":{"x":69,"y":453,"width":826,"height":11}},{"id":"b311980a-5220-4d11-8462-79bba2c6dd74","block_type":"box","text":"hybrid instrument, assuming a one percent price increase in the underlying commodity, futures contract, index or","page_number":49,"box":{"x":69,"y":468,"width":803,"height":11}},{"id":"1f1a5135-d15c-4965-bda0-e9e2d9e9533a","block_type":"box","text":"other economic factor. In other words, for a hybrid instrument with a leverage factor of 150%, a 1% gain in the","page_number":49,"box":{"x":69,"y":483,"width":783,"height":11}},{"id":"4e2b6016-4250-48da-8304-ca67d409ea5e","block_type":"box","text":"underlying economic variable would be expected to result in a 1.5% gain in value for the hybrid instrument.","page_number":49,"box":{"x":69,"y":498,"width":758,"height":11}},{"id":"d45bb005-b671-423e-83bf-309b3bb52b10","block_type":"box","text":"Conversely, a hybrid instrument with a leverage factor of 150% would suffer a 1.5% loss if the underlying economic","page_number":49,"box":{"x":69,"y":513,"width":818,"height":12}},{"id":"99fc5737-7778-4544-bea0-a0d42d6cb243","block_type":"box","text":"variable lost 1% of its value. “Por tfolio leverage ratio” is defined as the average (mean) leverage ratio of all","page_number":49,"box":{"x":68,"y":528,"width":763,"height":12}},{"id":"80b02337-ba0b-4efc-94f7-562a10089c77","block_type":"box","text":"instruments in a Fund’s por tfolio, weighted by the market values of such instruments or, in the case of futures","page_number":49,"box":{"x":70,"y":543,"width":787,"height":12}},{"id":"eedf2969-74ba-4a35-9295-11263e41685f","block_type":"box","text":"contracts, their notional values. A Fund may at times or from time to time decide not to use leverage in its","page_number":49,"box":{"x":69,"y":559,"width":757,"height":11}},{"id":"d5bc5b37-1503-43fd-82ba-f375dfd37ff5","block_type":"box","text":"investments or use less leverage than may otherwise be allowable.","page_number":49,"box":{"x":70,"y":574,"width":477,"height":11}},{"id":"b66ab0a1-be12-456c-8bb5-4531b5dfd088","block_type":"box","text":"Counterpar ty Risk.","page_number":49,"box":{"x":102,"y":597,"width":130,"height":11}},{"id":"14448fff-6682-4e4e-be61-0e2974904c30","block_type":"box","text":"A significant risk of hybrid instruments is counterpar ty risk. Unlike exchange-traded futures","page_number":49,"box":{"x":238,"y":596,"width":646,"height":12}},{"id":"7dd04edd-32b8-48a9-bf5a-766bc9bb0301","block_type":"box","text":"and options, which are standard contracts, hybrid instruments are customized securities, tailor-made by a specific","page_number":49,"box":{"x":69,"y":612,"width":813,"height":11}},{"id":"cccb2b48-128e-4d41-815e-16b668374dd1","block_type":"box","text":"issuer. With a listed futures or options contract, an investor’s counterpar ty is the exchange clearinghouse. Exchange","page_number":49,"box":{"x":70,"y":627,"width":829,"height":11}},{"id":"a46609b0-2af6-4abd-b692-6dad519e0f1b","block_type":"box","text":"clearinghouses are capitalized by the exchange members and typically have high investment grade ratings (","page_number":49,"box":{"x":69,"y":642,"width":763,"height":11}},{"id":"6d360105-acf5-42cf-8b33-07da178214b1","block_type":"box","text":"e.g.","page_number":49,"box":{"x":834,"y":643,"width":25,"height":10}},{"id":"7eeec95f-5c61-4362-ac1c-060f90dc5341","block_type":"box","text":",","page_number":49,"box":{"x":861,"y":649,"width":2,"height":3}},{"id":"f08391c7-c342-4875-90f9-dd75b2c070ac","block_type":"box","text":"ratings of AAA or AA by S&P). Therefore, the risk is small that an exchange clearinghouse might be unable to meet its","page_number":49,"box":{"x":69,"y":657,"width":836,"height":11}},{"id":"193c2e80-5bf0-4515-b189-a5d515a57d67","block_type":"box","text":"obligations at maturity. However, with a hybrid instrument, a Fund will take on the counterpar ty credit risk of the","page_number":49,"box":{"x":69,"y":672,"width":795,"height":11}},{"id":"2d33c733-db9e-4ab8-94df-1f46a031683b","block_type":"box","text":"issuer. That is, at maturity of the hybrid instrument, there is a risk that the issuer may be unable to per form its","page_number":49,"box":{"x":70,"y":687,"width":791,"height":11}},{"id":"18529b32-6d52-4276-b633-7a4d34c2864b","block_type":"box","text":"obligations under the structured note.","page_number":49,"box":{"x":69,"y":703,"width":268,"height":11}},{"id":"6c999b85-c969-4ae7-a40c-95d4b9d63780","block_type":"box","text":"Convertible Securities.","page_number":49,"box":{"x":102,"y":725,"width":165,"height":9}},{"id":"758718d8-24ac-418f-b8b3-865954aacfb5","block_type":"box","text":"A conver tible security is a bond, debenture, note, preferred stock or other security that","page_number":49,"box":{"x":273,"y":725,"width":619,"height":11}},{"id":"3a3ebb1f-8009-4543-9e68-834bbcb6d02a","block_type":"box","text":"may be conver ted into or exchanged for a prescribed amount of common stock or other equity security of the same or","page_number":49,"box":{"x":69,"y":740,"width":839,"height":11}},{"id":"8b0e1442-da9c-4739-813f-8a4cb6476ba9","block_type":"box","text":"a different issuer within a par ticular period of time at a specified price or formula. A conver tible security entitles the","page_number":49,"box":{"x":69,"y":755,"width":826,"height":11}},{"id":"53ab2479-22f1-492d-a67b-4f12dd36f0b9","block_type":"box","text":"holder to receive interest paid or accrued on debt or the dividend paid on preferred stock until the conver tible","page_number":49,"box":{"x":69,"y":770,"width":781,"height":11}},{"id":"7a429ad6-1751-4439-90cd-5c06ca3e4cad","block_type":"box","text":"security matures or is redeemed, conver ted or exchanged. Before conversion, conver tible securities have","page_number":49,"box":{"x":69,"y":785,"width":750,"height":12}},{"id":"bd6d5beb-ca89-4800-9a3b-adacc01de169","block_type":"box","text":"characteristics similar to nonconver tible income securities in that they ordinarily provide a stable stream of income","page_number":49,"box":{"x":69,"y":801,"width":819,"height":11}},{"id":"6e40ca47-662d-4095-aaaf-c8336af0876b","block_type":"box","text":"with generally higher yields than those of common stocks of the same or similar issuers, but lower yields than","page_number":49,"box":{"x":68,"y":816,"width":784,"height":11}},{"id":"1ebbb0f2-2748-44f7-80ba-d82ffdc4e3ca","block_type":"box","text":"comparable nonconver tible securities. The value of a conver tible security is influenced by changes in interest rates,","page_number":49,"box":{"x":69,"y":831,"width":823,"height":11}},{"id":"563ee868-5104-4091-96ad-798d17496654","block_type":"box","text":"with investment value declining as interest rates increase and increasing as interest rates decline. The credit","page_number":49,"box":{"x":68,"y":846,"width":780,"height":11}},{"id":"b24e937c-a35b-4e04-b6a5-d2bd9124a9d9","block_type":"box","text":"standing of the issuer and other factors also may have an effect on the conver tible security’s investment value.","page_number":49,"box":{"x":69,"y":861,"width":795,"height":11}},{"id":"e669489f-d6ab-4625-b3cc-7ad9db0f845e","block_type":"box","text":"Conver tible securities rank senior to common stock in a corporation’s capital structure but are usually subordinated","page_number":49,"box":{"x":69,"y":876,"width":826,"height":11}},{"id":"78e16f00-f7f8-47e2-a926-552143437919","block_type":"box","text":"to comparable nonconver tible securities. Conver tible securities may be subject to redemption at the option of the","page_number":49,"box":{"x":68,"y":891,"width":811,"height":11}},{"id":"041566f2-045a-4c26-be5c-e856a4cccd2c","block_type":"box","text":"issuer at a price established in the conver tible security’s governing instrument.","page_number":49,"box":{"x":70,"y":907,"width":563,"height":11}},{"id":"8eb15b83-d635-459e-a476-bd6074798913","block_type":"box","text":"II-5","page_number":49,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"076835fe-154a-47b5-b2b8-ddf1568b4e3e","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":49,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"489c6c23-6d75-480c-aa25-ef4d7cc3e727","block_type":"box","text":"The characteristics of conver tible securities make them potentially attractive investments for an investment","page_number":50,"box":{"x":101,"y":45,"width":767,"height":11}},{"id":"bc7756a3-6f14-4834-bbfc-2fc56848b945","block_type":"box","text":"company seeking a high total return from capital appreciation and investment income. These characteristics include","page_number":50,"box":{"x":69,"y":60,"width":826,"height":11}},{"id":"591a094f-af6d-4de3-a947-0f20b1f304c0","block_type":"box","text":"the potential for capital appreciation as the value of the underlying common stock increases, the relatively high yield","page_number":50,"box":{"x":68,"y":75,"width":829,"height":11}},{"id":"5bc4d869-c852-4b19-9aac-4d9b01ff41a2","block_type":"box","text":"received from dividend or interest payments as compared to common stock dividends and decreased risks of decline","page_number":50,"box":{"x":69,"y":90,"width":834,"height":11}},{"id":"b68b10ff-6653-4b74-b15e-f819ffd9f97a","block_type":"box","text":"in value relative to the underlying common stock due to their fixed-income nature. As a result of the conversion","page_number":50,"box":{"x":70,"y":105,"width":788,"height":11}},{"id":"757b6b7b-1b7d-405f-96cc-ef1306b0ccda","block_type":"box","text":"feature, however, the interest rate or dividend preference on a conver tible security is generally less than would be the","page_number":50,"box":{"x":68,"y":120,"width":839,"height":12}},{"id":"b99152e8-5b1a-491c-9a93-15cfeca1b9b2","block_type":"box","text":"case if the securities were issued in nonconver tible form.","page_number":50,"box":{"x":69,"y":135,"width":409,"height":9}},{"id":"e61b0fbb-cdb7-435c-8e32-f55a2984bebb","block_type":"box","text":"In analyzing conver tible securities, the Manager will consider both the yield on the conver tible security relative to","page_number":50,"box":{"x":102,"y":158,"width":802,"height":11}},{"id":"4eecdf1e-c987-4d58-9b03-332ec10e146c","block_type":"box","text":"its credit quality and the potential capital appreciation that is offered by the underlying common stock, among other","page_number":50,"box":{"x":70,"y":173,"width":824,"height":11}},{"id":"2a5ac18a-731d-4817-ba79-3c70fac3c908","block_type":"box","text":"things.","page_number":50,"box":{"x":68,"y":188,"width":47,"height":12}},{"id":"97b5ed0a-d4fe-4997-b65e-f587d7446131","block_type":"box","text":"Conver tible securities are issued and traded in a number of securities markets. Even in cases where a","page_number":50,"box":{"x":102,"y":211,"width":731,"height":9}},{"id":"93faf74d-10ff-4512-8218-49d465a844e0","block_type":"box","text":"substantial por tion of the conver tible securities held by a Fund are denominated in U.S. dollars, the underlying equity","page_number":50,"box":{"x":69,"y":226,"width":836,"height":11}},{"id":"2b212bc9-f5e0-427e-9b82-66c14b425d28","block_type":"box","text":"securities may be quoted in the currency of the country where the issuer is domiciled. As a result, fluctuations in the","page_number":50,"box":{"x":69,"y":241,"width":832,"height":11}},{"id":"399764d6-1c31-4120-b1a1-a78571acf0e9","block_type":"box","text":"exchange rate between the currency in which the debt security is denominated and the currency in which the share","page_number":50,"box":{"x":69,"y":257,"width":818,"height":11}},{"id":"e9106718-208f-4218-96e7-cd036f060239","block_type":"box","text":"price is quoted will affect the value of the conver tible security. With respect to conver tible securities denominated in","page_number":50,"box":{"x":70,"y":271,"width":828,"height":12}},{"id":"bafebcd3-e97c-43de-9da9-ca286c190ac2","block_type":"box","text":"a currency different from that of the underlying equity securities, the conversion price may be based on a fixed","page_number":50,"box":{"x":69,"y":286,"width":786,"height":12}},{"id":"063a7061-2ad2-4461-9467-8e063176a658","block_type":"box","text":"exchange rate established at the time the security is issued, which may increase the effects of currency risk. As","page_number":50,"box":{"x":69,"y":302,"width":800,"height":11}},{"id":"349793be-3b8b-4707-9958-b55cb384ac92","block_type":"box","text":"described below, a Fund is authorized to enter into foreign currency hedging transactions in which it may seek to","page_number":50,"box":{"x":69,"y":317,"width":800,"height":11}},{"id":"4e0c3d91-368d-4592-889b-fa57918a834e","block_type":"box","text":"reduce the effect of exchange rate fluctuations.","page_number":50,"box":{"x":69,"y":332,"width":337,"height":11}},{"id":"259087ff-871a-410a-b173-05fe32dcf287","block_type":"box","text":"Apar t from currency considerations, the value of conver tible securities is influenced by both the yield on","page_number":50,"box":{"x":101,"y":355,"width":741,"height":11}},{"id":"5211c1e5-d4bf-424e-86f9-d3904bc904be","block_type":"box","text":"nonconver tible securities of comparable issuers and by the value of the underlying common stock. The value of a","page_number":50,"box":{"x":69,"y":370,"width":806,"height":11}},{"id":"3dc1e3cb-a0d4-4202-ba41-8640b8d28bc8","block_type":"box","text":"conver tible security viewed without regard to its conversion feature (","page_number":50,"box":{"x":69,"y":385,"width":485,"height":11}},{"id":"40b1bfdc-57f3-46ec-84e0-2b91828e4fc1","block_type":"box","text":"i.e.","page_number":50,"box":{"x":557,"y":385,"width":20,"height":9}},{"id":"e48f3bc8-1bcb-49a3-b6bd-7811c1d408c2","block_type":"box","text":", strictly on the basis of its yield) is","page_number":50,"box":{"x":579,"y":385,"width":248,"height":11}},{"id":"97bb6398-9868-4d85-ba8f-8fcbf6b4b46c","block_type":"box","text":"sometimes referred to as its “investment value.” To the extent interest rates change, the investment value of the","page_number":50,"box":{"x":69,"y":400,"width":808,"height":11}},{"id":"6b2de0d8-1c8f-4453-9260-15aeced8d2db","block_type":"box","text":"conver tible security typically will fluctuate. At the same time, however, the value of the conver tible security will be","page_number":50,"box":{"x":69,"y":415,"width":807,"height":11}},{"id":"4a246c55-5e03-47f4-84b1-e475b1bc5f8f","block_type":"box","text":"influenced by its “conversion value,” which is the market value of the underlying common stock that would be","page_number":50,"box":{"x":70,"y":430,"width":778,"height":11}},{"id":"16dbe9e5-6e55-477f-9859-7fc7d30400a4","block_type":"box","text":"obtained if the conver tible security were conver ted. Conversion value fluctuates directly with the price of the","page_number":50,"box":{"x":69,"y":445,"width":769,"height":11}},{"id":"affc120f-9edf-42db-81b8-c0670d5a3d68","block_type":"box","text":"underlying common stock. If the conversion value of a conver tible security is substantially below its investment value,","page_number":50,"box":{"x":69,"y":460,"width":837,"height":12}},{"id":"ebee7b9f-4117-4f4d-8a4d-fb53fd0343f9","block_type":"box","text":"the price of the conver tible security is governed principally by its investment value. To the extent the conversion value","page_number":50,"box":{"x":68,"y":475,"width":837,"height":12}},{"id":"1963fd99-2700-481c-8cca-2881cc7ab631","block_type":"box","text":"of a conver tible security increases to a point that approximates or exceeds its investment value, the price of the","page_number":50,"box":{"x":69,"y":491,"width":800,"height":11}},{"id":"6a4f9b03-62c2-4986-99be-799d09e150e3","block_type":"box","text":"conver tible security will be influenced principally by its conversion value. A conver tible security will sell at a premium","page_number":50,"box":{"x":69,"y":506,"width":828,"height":11}},{"id":"6cf9a1f4-e550-47cf-9a03-7834f1a00533","block_type":"box","text":"over the conversion value to the extent investors place value on the right to acquire the underlying common stock","page_number":50,"box":{"x":69,"y":521,"width":808,"height":11}},{"id":"a07b98a9-9cad-45f5-8b13-03dedb275702","block_type":"box","text":"while holding a fixed-income security. The yield and conversion premium of conver tible securities issued in Japan and","page_number":50,"box":{"x":68,"y":536,"width":835,"height":11}},{"id":"d874dd4d-0075-4943-a9bd-26596136e613","block_type":"box","text":"the Euromarket are frequently determined at levels that cause the conversion value to affect their market value more","page_number":50,"box":{"x":68,"y":551,"width":836,"height":11}},{"id":"befaf7cf-566c-4932-bf64-cb8f3f4a1fca","block_type":"box","text":"than the securities’ investment value.","page_number":50,"box":{"x":68,"y":566,"width":268,"height":9}},{"id":"f0452695-8080-4144-bc8e-1819fd66a51a","block_type":"box","text":"Holders of conver tible securities generally have a claim on the assets of the issuer prior to the common","page_number":50,"box":{"x":102,"y":589,"width":740,"height":11}},{"id":"66523ac9-415c-4080-9fe2-9e7db28036e9","block_type":"box","text":"stockholders but may be subordinated to other debt securities of the same issuer. A conver tible security may be","page_number":50,"box":{"x":69,"y":604,"width":801,"height":11}},{"id":"9b724691-0308-41b6-afe7-d98559a0e8c7","block_type":"box","text":"subject to redemption at the option of the issuer at a price established in a char ter provision, indenture or other","page_number":50,"box":{"x":69,"y":619,"width":800,"height":11}},{"id":"228a3768-76a2-4ed5-9cb7-b16d36f3f560","block_type":"box","text":"governing instrument pursuant to which the conver tible security was issued. If a conver tible security held by a Fund is","page_number":50,"box":{"x":68,"y":634,"width":840,"height":12}},{"id":"cbee3c9a-8d9f-4fd0-a614-f7f5abe25487","block_type":"box","text":"called for redemption, the Fund will be required to redeem the security, conver t it into the underlying common stock","page_number":50,"box":{"x":69,"y":649,"width":823,"height":12}},{"id":"34121b3b-ff4d-4bc2-a752-160ba45be182","block_type":"box","text":"or sell it to a third par ty. Cer tain conver tible debt securities may provide a put option to the holder, which entitles the","page_number":50,"box":{"x":69,"y":665,"width":835,"height":11}},{"id":"89543b89-269c-4955-86a6-c0926c1cce7b","block_type":"box","text":"holder to cause the security to be redeemed by the issuer at a premium over the stated principal amount of the debt","page_number":50,"box":{"x":69,"y":680,"width":832,"height":11}},{"id":"382a80af-4af5-44cc-99e7-ea3c5e70bbd5","block_type":"box","text":"security under cer tain circumstances.","page_number":50,"box":{"x":69,"y":695,"width":267,"height":11}},{"id":"413c48a1-ab24-493f-b32b-92a825e53b84","block_type":"box","text":"A Fund may also invest in synthetic conver tible securities. Synthetic conver tible securities may include either","page_number":50,"box":{"x":101,"y":718,"width":777,"height":11}},{"id":"354bfcf6-d752-4774-ac5e-745084731ba7","block_type":"box","text":"Cash-Settled Conver tibles or Manufactured Conver tibles. “Cash-Settled Conver tibles” are instruments that are","page_number":50,"box":{"x":69,"y":732,"width":789,"height":10}},{"id":"24649386-a6d9-4ec8-a1e4-3d71ce4b28d5","block_type":"box","text":"created by the issuer and have the economic characteristics of traditional conver tible securities but may not actually","page_number":50,"box":{"x":69,"y":748,"width":831,"height":11}},{"id":"3f29c332-00ed-4616-814b-a911cfb588c5","block_type":"box","text":"permit conversion into the underlying equity securities in all circumstances. As an example, a private company may","page_number":50,"box":{"x":70,"y":763,"width":819,"height":11}},{"id":"4c7c82d0-b48d-4382-9469-026a30ba5eaa","block_type":"box","text":"issue a Cash-Settled Conver tible that is conver tible into common stock only if the company successfully completes a","page_number":50,"box":{"x":70,"y":778,"width":833,"height":11}},{"id":"7b1cd3f9-2c3f-4bf9-ba4f-69807404cd5c","block_type":"box","text":"public offering of its common stock prior to maturity and otherwise pays a cash amount to reflect any equity","page_number":50,"box":{"x":70,"y":793,"width":769,"height":11}},{"id":"bd831806-f856-4fbb-a9db-b783eea98f3d","block_type":"box","text":"appreciation. “Manufactured Conver tibles” are created by the Manager or another par ty by combining separate","page_number":50,"box":{"x":69,"y":808,"width":791,"height":11}},{"id":"c4851ce1-fcec-4b25-9c51-c4bb4dfe0214","block_type":"box","text":"securities that possess one of the two principal characteristics of a conver tible security,","page_number":50,"box":{"x":69,"y":823,"width":627,"height":11}},{"id":"6e44c3cf-6cfd-4a9a-b03c-fbff9d4dd427","block_type":"box","text":"i.e.","page_number":50,"box":{"x":703,"y":823,"width":20,"height":9}},{"id":"fcf585f7-40a8-41cb-974d-486a218c7183","block_type":"box","text":", fixed-income (“fixed","page_number":50,"box":{"x":726,"y":823,"width":151,"height":11}},{"id":"2aaf3b2f-65d6-450f-81db-59574ddfe8c3","block_type":"box","text":"income component”) or a right to acquire equity securities (“conver tibility component”). The fixed-income component","page_number":50,"box":{"x":70,"y":838,"width":830,"height":12}},{"id":"6a01c19e-aaac-4855-8b5f-e1dd9a61b67a","block_type":"box","text":"is achieved by investing in nonconver tible fixed-income securities, such as nonconver tible bonds, preferred stocks","page_number":50,"box":{"x":70,"y":853,"width":814,"height":12}},{"id":"5cf31bdd-cc0c-44bc-88a1-983cd1ce8198","block_type":"box","text":"and money market instruments. The conver tibility component is achieved by investing in call options, warrants, or","page_number":50,"box":{"x":69,"y":869,"width":811,"height":11}},{"id":"95601d17-60e4-444d-8384-6e155e64a60d","block_type":"box","text":"other securities with equity conversion features (“equity features”) granting the holder the right to purchase a","page_number":50,"box":{"x":69,"y":884,"width":779,"height":11}},{"id":"0adaf5f9-3a73-4e41-9e6f-d1f8ffc6d3b2","block_type":"box","text":"II-6","page_number":50,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"ef27fea0-5110-4e33-9195-7010a777994f","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":50,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"d100ba94-730d-48ac-b1d4-fd16cdf4437d","block_type":"box","text":"specified quantity of the underlying stocks within a specified period of time at a specified price or, in the case of a","page_number":51,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"f289c72d-27ae-4d6f-8e9a-4364300708bc","block_type":"box","text":"stock index option, the right to receive a cash payment based on the value of the underlying stock index.","page_number":51,"box":{"x":69,"y":60,"width":744,"height":11}},{"id":"8a8c19e0-6e20-4ac1-9745-9ead9bbb6ae8","block_type":"box","text":"A Manufactured Conver tible differs from traditional conver tible securities in several respects. Unlike a traditional","page_number":51,"box":{"x":101,"y":82,"width":804,"height":11}},{"id":"95e19da6-3600-4fd7-ae43-5365eb7c6b07","block_type":"box","text":"conver tible security, which is a single security that has a unitary market value, a Manufactured Conver tible is","page_number":51,"box":{"x":69,"y":98,"width":777,"height":11}},{"id":"bc90afaf-6a05-4d43-8949-b3a9b0036406","block_type":"box","text":"comprised of two or more separate securities, each with its own market value. Therefore, the total “market value” of","page_number":51,"box":{"x":69,"y":113,"width":832,"height":11}},{"id":"9bcabeca-4a00-43cd-9c31-5e928a757033","block_type":"box","text":"such a Manufactured Conver tible is the sum of the values of its fixed-income component and its conver tibility","page_number":51,"box":{"x":69,"y":128,"width":781,"height":11}},{"id":"a2ac5ad6-960f-4202-a9b2-019de5769f62","block_type":"box","text":"component.","page_number":51,"box":{"x":69,"y":144,"width":82,"height":10}},{"id":"4cf4b0db-5240-4f85-8aba-ea2ab1ef3ca6","block_type":"box","text":"More flexibility is possible in the creation of a Manufactured Conver tible than in the purchase of a traditional","page_number":51,"box":{"x":102,"y":166,"width":773,"height":11}},{"id":"7b1a44e7-f31a-4e43-aaf1-d8ade2fb4ed0","block_type":"box","text":"conver tible security. Because many corporations have not issued conver tible securities, the Manager may combine a","page_number":51,"box":{"x":69,"y":181,"width":833,"height":11}},{"id":"82da1fbe-edc5-436c-bcad-d02f39ba3ee6","block_type":"box","text":"fixed-income instrument and an equity feature with respect to the stock of the issuer of the fixed-income instrument","page_number":51,"box":{"x":68,"y":196,"width":826,"height":11}},{"id":"01fc550d-6902-4ae0-91fe-d63c8c6c5262","block_type":"box","text":"to create a synthetic conver tible security otherwise unavailable in the market. The Manager may also combine a","page_number":51,"box":{"x":68,"y":211,"width":800,"height":11}},{"id":"cc5dc595-13b0-4ea4-80b0-d6f24224b708","block_type":"box","text":"fixed-income instrument of an issuer with an equity feature with respect to the stock of a different issuer when the","page_number":51,"box":{"x":68,"y":226,"width":817,"height":11}},{"id":"5d4270ce-5f79-483c-a55e-778b6585ca7d","block_type":"box","text":"Manager believes such a Manufactured Conver tible would better promote a Fund’s objective than alternative","page_number":51,"box":{"x":70,"y":241,"width":772,"height":11}},{"id":"e9d5b16d-b3b9-431e-9402-667ef7d52f77","block_type":"box","text":"investments. For example, the Manager may combine an equity feature with respect to an issuer’s stock with a fixed","page_number":51,"box":{"x":70,"y":256,"width":833,"height":12}},{"id":"3e4bcead-1307-4492-82af-2f8ec8a97fe6","block_type":"box","text":"income security of a different issuer in the same industry to diversify the Fund’s credit exposure, or with a U.S.","page_number":51,"box":{"x":70,"y":271,"width":790,"height":12}},{"id":"c48b7bad-f831-4a25-b858-f566999d1104","block_type":"box","text":"Treasury instrument to create a Manufactured Conver tible with a higher credit profile than a traditional conver tible","page_number":51,"box":{"x":68,"y":286,"width":815,"height":12}},{"id":"0838d917-6e10-4435-9396-6d3ba87f64a0","block_type":"box","text":"security issued by that issuer. A Manufactured Conver tible also is a more flexible investment in that its two","page_number":51,"box":{"x":69,"y":302,"width":764,"height":11}},{"id":"cfffeb64-d545-4a6d-ac44-4fd0d7bff23f","block_type":"box","text":"components may be purchased separately and, upon purchasing the separate securities, “combined” to create a","page_number":51,"box":{"x":69,"y":317,"width":806,"height":11}},{"id":"1be5e417-bdd3-4fe5-affa-8a2adb68cc55","block_type":"box","text":"Manufactured Conver tible. For example, the Fund may purchase a warrant for eventual inclusion in a Manufactured","page_number":51,"box":{"x":70,"y":332,"width":818,"height":11}},{"id":"dff582b0-117b-4019-979d-85781c96edc3","block_type":"box","text":"Conver tible while postponing the purchase of a suitable bond to pair with the warrant pending development of more","page_number":51,"box":{"x":69,"y":347,"width":824,"height":11}},{"id":"b197237a-e1ab-4168-8979-a397f0dadbe1","block_type":"box","text":"favorable market conditions.","page_number":51,"box":{"x":68,"y":362,"width":202,"height":9}},{"id":"dc38a0c7-996c-455e-ae6e-1c985f225015","block_type":"box","text":"The value of a Manufactured Conver tible may respond to cer tain market fluctuations differently from a traditional","page_number":51,"box":{"x":101,"y":385,"width":805,"height":11}},{"id":"0bed45a1-a518-43a5-8666-0409620efb30","block_type":"box","text":"conver tible security with similar characteristics. For example, in the event a Fund created a Manufactured Conver tible","page_number":51,"box":{"x":69,"y":400,"width":837,"height":11}},{"id":"accb80a7-40d2-42e3-bd98-f2bf61a0a56b","block_type":"box","text":"by combining a shor t-term U.S. Treasury instrument and a call option on a stock, the Manufactured Conver tible would","page_number":51,"box":{"x":69,"y":415,"width":839,"height":11}},{"id":"7ff4a582-0c80-4c53-8a20-1060727ab76b","block_type":"box","text":"be expected to outper form a traditional conver tible of similar maturity that is conver tible into that stock during","page_number":51,"box":{"x":69,"y":430,"width":787,"height":11}},{"id":"8ce3181f-7689-45c3-b387-53f5e403f6b3","block_type":"box","text":"periods when Treasury instruments outper form corporate fixed-income securities and underper form during periods","page_number":51,"box":{"x":70,"y":445,"width":815,"height":12}},{"id":"90ae6734-e5c3-4459-b618-3d8febad7dd8","block_type":"box","text":"when corporate fixed-income securities outper form Treasury instruments.","page_number":51,"box":{"x":68,"y":460,"width":523,"height":12}},{"id":"0893aac9-ac0c-4ead-868d-0a4804056b0f","block_type":"box","text":"Corporate Loans.","page_number":51,"box":{"x":102,"y":483,"width":123,"height":11}},{"id":"96fb3afb-cf00-4398-a38d-a08f82bcc253","block_type":"box","text":"Cer tain Funds may invest in corporate loans. Corporate loans are generally non-investment","page_number":51,"box":{"x":231,"y":483,"width":647,"height":11}},{"id":"04da6cdc-553f-4185-9424-17a68dd681f5","block_type":"box","text":"grade floating rate instruments. Usually, they are freely callable at the issuer’s option. Cer tain Funds may invest in","page_number":51,"box":{"x":68,"y":498,"width":817,"height":11}},{"id":"f86998b3-d955-450f-8096-76815e526361","block_type":"box","text":"fixed and floating rate loans (“Loans”) arranged through private negotiations between a corporate borrower or a","page_number":51,"box":{"x":68,"y":513,"width":794,"height":12}},{"id":"fed1b800-8560-4d6f-82c8-81847328d316","block_type":"box","text":"foreign sovereign entity and one or more financial institutions or institutional investors (“Lenders”). A Fund may invest","page_number":51,"box":{"x":68,"y":528,"width":841,"height":12}},{"id":"4256a677-28e9-4bb9-a846-be09fa286429","block_type":"box","text":"in such Loans in the form of par ticipations in Loans (“Par ticipations”) and assignments of all or a por tion of Loans","page_number":51,"box":{"x":70,"y":543,"width":818,"height":12}},{"id":"7e487eff-d7d3-434b-aba2-e9f5938a2e8b","block_type":"box","text":"from third par ties (“Assignments”). A Fund considers these investments to be investments in debt securities for","page_number":51,"box":{"x":68,"y":559,"width":801,"height":11}},{"id":"598069d6-4c84-47c2-a4ad-72b2b41f1482","block_type":"box","text":"purposes of its investment policies. Par ticipations typically will result in the Fund having a contractual relationship","page_number":51,"box":{"x":70,"y":574,"width":811,"height":11}},{"id":"e758dd9f-a470-4b64-92a3-df777192b91a","block_type":"box","text":"only with the Lender, not with the borrower. The Fund will have the right to receive payments of principal, interest and","page_number":51,"box":{"x":69,"y":589,"width":833,"height":11}},{"id":"053f18fc-24c3-417f-b210-46a9bc10528c","block_type":"box","text":"any fees to which it is entitled only from the Lender selling the Par ticipation and only upon receipt by the Lender of","page_number":51,"box":{"x":69,"y":604,"width":817,"height":11}},{"id":"e6ee4c23-de65-4f4d-ba5a-8a674348b5bd","block_type":"box","text":"the payments from the borrower. In connection with purchasing Par ticipations, the Fund generally will have no right to","page_number":51,"box":{"x":68,"y":619,"width":836,"height":11}},{"id":"1b31e984-c3fe-4252-95ae-3e1b2de3f657","block_type":"box","text":"enforce compliance by the borrower with the terms of the loan agreement relating to the Loans, nor any rights of set","page_number":51,"box":{"x":69,"y":634,"width":833,"height":12}},{"id":"99c714d7-f04c-4782-8964-84cec82a469c","block_type":"box","text":"off against the borrower, and the Fund may not benefit directly from any collateral suppor ting the Loan in which it has","page_number":51,"box":{"x":69,"y":649,"width":837,"height":12}},{"id":"3e9e5604-f2ef-4187-bc24-4bde47b6e700","block_type":"box","text":"purchased the Par ticipation. As a result, the Fund will assume the credit risk of both the borrower and the Lender","page_number":51,"box":{"x":70,"y":664,"width":809,"height":11}},{"id":"9abf1eed-79d0-437e-bd28-7fc706365dce","block_type":"box","text":"that is selling the Par ticipation. In the event of the insolvency of the Lender selling the Par ticipation, the Fund may be","page_number":51,"box":{"x":68,"y":680,"width":838,"height":11}},{"id":"0ff61787-485e-456d-bd35-8b49a9323488","block_type":"box","text":"treated as a general creditor of the Lender and may not benefit from any set-off between the Lender and the","page_number":51,"box":{"x":68,"y":695,"width":772,"height":11}},{"id":"fb540d05-2db1-46c8-a584-dc64e20328d1","block_type":"box","text":"borrower. The Fund will acquire Par ticipations only if the Lender interpositioned between the Fund and the borrower is","page_number":51,"box":{"x":69,"y":710,"width":837,"height":11}},{"id":"371ef201-6039-43d8-9d0f-ef93b60fa8da","block_type":"box","text":"determined by the Fund’s manager to be creditwor thy. When the Fund purchases Assignments from Lenders, the","page_number":51,"box":{"x":69,"y":725,"width":804,"height":11}},{"id":"46ca9cb0-3a0e-466f-bc2c-5dad9e8c1e0a","block_type":"box","text":"Fund will acquire direct rights against the borrower on the Loan, and will not have exposure to a counterpar ty’s credit","page_number":51,"box":{"x":70,"y":740,"width":834,"height":11}},{"id":"18084526-9806-4a37-ab55-21993df498be","block_type":"box","text":"risk. The Funds may enter into Par ticipations and Assignments on a forward commitment or “when-issued” basis,","page_number":51,"box":{"x":69,"y":755,"width":809,"height":11}},{"id":"d6808463-e9a4-4c02-952a-979559b28e39","block_type":"box","text":"whereby a Fund would agree to purchase a Par ticipation or Assignment at set terms in the future. For more","page_number":51,"box":{"x":68,"y":770,"width":764,"height":12}},{"id":"56d96933-f362-4b6c-b9f2-54fa98561326","block_type":"box","text":"information on forward commitments and when-issued securities, see “When-Issued Securities, Delayed Delivery","page_number":51,"box":{"x":70,"y":785,"width":805,"height":12}},{"id":"d7de268f-a97b-4ac1-a956-da03102d7370","block_type":"box","text":"Securities and Forward Commitments” below.","page_number":51,"box":{"x":69,"y":801,"width":324,"height":9}},{"id":"a6b48e12-49b9-421f-81fa-20f7da1bf8c4","block_type":"box","text":"A Fund may have difficulty disposing of Assignments and Par ticipations. In cer tain cases, the market for such","page_number":51,"box":{"x":101,"y":823,"width":782,"height":12}},{"id":"77628ab5-2647-496c-be48-cd4f5e65e2f0","block_type":"box","text":"instruments may lack sufficient liquidity, and therefore the Fund anticipates that in such cases such instruments","page_number":51,"box":{"x":70,"y":838,"width":803,"height":11}},{"id":"9d65e1b0-801b-49ac-9127-def9f4cfc8e3","block_type":"box","text":"could be sold only to a limited number of institutional investors. The lack of a sufficiently liquid secondary market","page_number":51,"box":{"x":69,"y":853,"width":809,"height":12}},{"id":"4e8e81b0-a3e3-419c-9e43-eb1481074829","block_type":"box","text":"may have an adverse impact on the value of such instruments and on the Fund’s ability to dispose of par ticular","page_number":51,"box":{"x":69,"y":869,"width":795,"height":11}},{"id":"46f51356-03ca-40d1-b753-def740e6751a","block_type":"box","text":"Assignments or Par ticipations in response to a specific economic event, such as deterioration in the creditwor thiness","page_number":51,"box":{"x":68,"y":884,"width":841,"height":11}},{"id":"1daf8df7-a4fa-4a78-a4cc-fec13640e3e1","block_type":"box","text":"of the borrower.","page_number":51,"box":{"x":69,"y":899,"width":111,"height":9}},{"id":"40b59c33-4bdc-4bad-aad5-57b4521f006d","block_type":"box","text":"II-7","page_number":51,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"97c42b6a-d1cc-4ca9-a3ff-d314befe9203","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":51,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"127de808-03d0-458d-a4dd-d0b57cd0bebd","block_type":"box","text":"Leading financial institutions often act as agent for a broader group of Lenders, generally referred to as a","page_number":52,"box":{"x":102,"y":45,"width":750,"height":11}},{"id":"f40ee583-a39b-4a81-ab05-87216bcd48cb","block_type":"box","text":"syndicate. The syndicate’s agent arranges the loans, holds collateral and accepts payments of principal and interest.","page_number":52,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"380b9e4b-291c-4e9d-b37b-93a15899b032","block_type":"box","text":"Failure by the syndicate agent to fulfill its obligations may delay or adversely affect receipt of payment by the Fund.","page_number":52,"box":{"x":70,"y":75,"width":816,"height":11}},{"id":"6fab508d-2057-4763-a19b-8af47aef4e32","block_type":"box","text":"The Loans in which the Fund may invest are subject to the risk of loss of principal and income. Although","page_number":52,"box":{"x":101,"y":98,"width":740,"height":11}},{"id":"15a9d87a-361c-4107-81ea-89a250d561f4","block_type":"box","text":"borrowers frequently provide collateral to secure repayment of these obligations they do not always do so. If they do","page_number":52,"box":{"x":69,"y":113,"width":827,"height":11}},{"id":"8303840f-f51d-40a9-8284-609b70d3cde1","block_type":"box","text":"provide collateral, the value of the collateral may not completely cover the borrower’s obligations at the time of a","page_number":52,"box":{"x":70,"y":128,"width":802,"height":11}},{"id":"85685f2c-fa13-44c7-90c3-9219c59e3f94","block_type":"box","text":"default. If a borrower files for protection from its creditors under the U.S. bankruptcy laws, these laws may limit a","page_number":52,"box":{"x":69,"y":143,"width":808,"height":11}},{"id":"acc543a6-4fd6-4302-abc1-386b9c897780","block_type":"box","text":"Fund’s rights to its collateral. In addition, the value of collateral may erode during a bankruptcy case. In the event of","page_number":52,"box":{"x":70,"y":158,"width":827,"height":11}},{"id":"dbfa84f8-8812-42e9-b098-a52d6cbcdb19","block_type":"box","text":"a bankruptcy, the holder of a Loan may not recover its principal, may experience a long delay in recovering its","page_number":52,"box":{"x":69,"y":173,"width":777,"height":11}},{"id":"e3109383-3ee1-482f-aaea-cb6ccdbfc1f2","block_type":"box","text":"investment and may not receive interest during the delay.","page_number":52,"box":{"x":70,"y":188,"width":406,"height":12}},{"id":"0d052000-2af2-44a1-8905-7ea009c38a10","block_type":"box","text":"Transactions in corporate loans may settle on a delayed basis. As a result, the proceeds from the sale of","page_number":52,"box":{"x":101,"y":211,"width":752,"height":11}},{"id":"59f9e856-7bf0-4f4f-a9f4-cef08af0b29b","block_type":"box","text":"corporate loans may not be readily available to make additional investments or to meet a Fund’s redemption","page_number":52,"box":{"x":69,"y":226,"width":773,"height":11}},{"id":"cd30eba0-b7a2-4c32-8caa-9e114989610f","block_type":"box","text":"obligations. To the extent the extended settlement process gives rise to shor t-term liquidity needs, a Fund may hold","page_number":52,"box":{"x":69,"y":241,"width":824,"height":11}},{"id":"0466f9c0-6452-44bf-a512-f61444908f10","block_type":"box","text":"additional cash, sell investments or temporarily borrow from banks and other lenders.","page_number":52,"box":{"x":69,"y":256,"width":610,"height":11}},{"id":"6ca3de5f-3c0b-45fe-b8cc-c21a11c42851","block_type":"box","text":"In cer tain circumstances, Loans may not be deemed to be securities under cer tain federal securities laws.","page_number":52,"box":{"x":102,"y":279,"width":759,"height":11}},{"id":"9c24def1-894e-4388-aa04-a3d8103f63bf","block_type":"box","text":"Therefore, in the event of fraud or misrepresentation by a borrower or an arranger, Lenders and purchasers of","page_number":52,"box":{"x":68,"y":294,"width":784,"height":11}},{"id":"5df281e1-e3a3-4a8e-9773-7d01dc022c7a","block_type":"box","text":"interests in Loans, such as the Funds, may not have the protection of the anti-fraud provisions of the federal","page_number":52,"box":{"x":70,"y":309,"width":772,"height":11}},{"id":"d7a648a6-a66f-422a-a989-eadc8f2d4ece","block_type":"box","text":"securities laws as would otherwise be available for bonds or stocks. Instead, in such cases, par ties generally would","page_number":52,"box":{"x":69,"y":324,"width":827,"height":12}},{"id":"7d4cf0f1-a3af-49fb-b97e-b52c7ca8ae59","block_type":"box","text":"rely on the contractual provisions in the Loan agreement itself and common-law fraud protections under applicable","page_number":52,"box":{"x":69,"y":339,"width":815,"height":12}},{"id":"b92c8a3e-0318-45e6-8fea-e67af65c4622","block_type":"box","text":"state law.","page_number":52,"box":{"x":69,"y":355,"width":67,"height":9}},{"id":"5a4bbb87-de88-41e2-a095-9f7720f9051b","block_type":"box","text":"Direct Lending.","page_number":52,"box":{"x":102,"y":377,"width":105,"height":12}},{"id":"d763c653-ce69-4592-bcea-002d90dac089","block_type":"box","text":"The Fund may act as the originator for direct loans and engage in direct lending. Direct loans","page_number":52,"box":{"x":213,"y":377,"width":660,"height":12}},{"id":"f104f150-1634-4169-8483-19a1845a11bb","block_type":"box","text":"between the Fund and a borrower may not be administered by an underwriter or agent bank. The Fund may provide","page_number":52,"box":{"x":69,"y":393,"width":817,"height":11}},{"id":"c735fc0b-80f8-49b4-81bb-a04fb3ff3766","block_type":"box","text":"financing to commercial borrowers directly or through companies acquired (or created) and owned by or otherwise","page_number":52,"box":{"x":68,"y":407,"width":811,"height":12}},{"id":"8528fe0e-f354-422c-81ae-21e6b2dfec16","block_type":"box","text":"affiliated with the Fund. The terms of the direct loans are negotiated with borrowers in private transactions.","page_number":52,"box":{"x":69,"y":423,"width":764,"height":11}},{"id":"4562e4de-b732-4865-b4af-92351656eeac","block_type":"box","text":"Fur thermore, a direct loan may be secured or unsecured.","page_number":52,"box":{"x":70,"y":438,"width":405,"height":11}},{"id":"a71a7878-ec0b-4b6f-a033-40c781a9816b","block_type":"box","text":"In determining whether to make a direct loan, the Fund will rely primarily upon the creditwor thiness of the","page_number":52,"box":{"x":102,"y":460,"width":750,"height":12}},{"id":"fe760325-794c-4839-89a5-c09bcbd8c7e8","block_type":"box","text":"borrower and/or any collateral for payment of interest and repayment of principal. The risks associated with direct","page_number":52,"box":{"x":69,"y":475,"width":813,"height":12}},{"id":"42f561e1-d09d-4694-920d-aca4c91ed65c","block_type":"box","text":"loans are substantially similar to those associated with investing in corporate loans. In making a direct loan, the Fund","page_number":52,"box":{"x":70,"y":491,"width":838,"height":11}},{"id":"062ab4e0-fd65-4017-8d65-988c2683a8db","block_type":"box","text":"is exposed to the risk that the borrower may default or become insolvent and, consequently, that the Fund will lose","page_number":52,"box":{"x":70,"y":506,"width":818,"height":11}},{"id":"0c385215-8b8c-40c8-a048-242b9ec2df44","block_type":"box","text":"money on the loan. Fur thermore, direct loans may subject the Fund to liquidity and interest rate risk and cer tain","page_number":52,"box":{"x":69,"y":521,"width":798,"height":11}},{"id":"0659179b-e924-4fda-8712-393d5993f6e9","block_type":"box","text":"direct loans may be deemed illiquid. Direct loans are not publicly traded and may not have a secondary market. The","page_number":52,"box":{"x":69,"y":536,"width":825,"height":11}},{"id":"99572e58-5f30-48da-8988-5c6a9203f51c","block_type":"box","text":"lack of a secondary market for direct loans may have an adverse impact on the ability of the Fund to dispose of a","page_number":52,"box":{"x":70,"y":551,"width":807,"height":11}},{"id":"54fcfdf9-e3b0-42bd-898a-760e696c59c1","block_type":"box","text":"direct loan and/or to value the direct loan.","page_number":52,"box":{"x":69,"y":566,"width":301,"height":11}},{"id":"7a5bc141-80c2-4ecd-89c7-935b43e862ba","block_type":"box","text":"When engaging in direct lending, the Fund’s per formance may depend, in par t, on the ability of the Fund to","page_number":52,"box":{"x":101,"y":589,"width":762,"height":11}},{"id":"a302aaf6-c243-4779-a1a2-8f69bd19571b","block_type":"box","text":"originate loans on advantageous terms. In originating loans, the Fund will compete with a broad spectrum of lenders.","page_number":52,"box":{"x":69,"y":604,"width":833,"height":11}},{"id":"02b2a5c5-da60-4091-a699-0a2a29e7e216","block_type":"box","text":"Increased competition for, or a diminishment in the available supply of, qualifying loans could result in lower yields on","page_number":52,"box":{"x":70,"y":619,"width":836,"height":11}},{"id":"0daa78cb-8b45-44c7-8919-3c2540881b10","block_type":"box","text":"such loans, which could reduce Fund per formance.","page_number":52,"box":{"x":69,"y":634,"width":362,"height":11}},{"id":"696f5682-cb13-42f2-8508-44c1317d3844","block_type":"box","text":"As par t of its lending activities, the Fund may originate loans to companies that are experiencing significant","page_number":52,"box":{"x":101,"y":657,"width":767,"height":11}},{"id":"8d99b4b6-7ac6-4f8b-b3a3-92e31ab4945a","block_type":"box","text":"financial or business difficulties, including companies involved in bankruptcy or other reorganization and liquidation","page_number":52,"box":{"x":68,"y":672,"width":821,"height":11}},{"id":"e7136c98-3715-4119-98f2-2d876db2a4f3","block_type":"box","text":"proceedings. Although the terms of such financing may result in significant financial returns to the Fund, they involve","page_number":52,"box":{"x":70,"y":687,"width":830,"height":11}},{"id":"eeb3bca6-680a-477f-a208-0695ebb04e77","block_type":"box","text":"a substantial degree of risk. The level of analytical sophistication, both financial and legal, necessary for successful","page_number":52,"box":{"x":69,"y":702,"width":826,"height":12}},{"id":"bfd153a9-61ec-4020-a8c8-878805f44f41","block_type":"box","text":"financing to companies experiencing significant business and financial difficulties is unusually high.","page_number":52,"box":{"x":68,"y":717,"width":709,"height":12}},{"id":"10877236-5a60-4a04-93cb-7125130db03f","block_type":"box","text":"Credit Linked Securities.","page_number":52,"box":{"x":102,"y":740,"width":179,"height":9}},{"id":"8d3a5915-1fb9-4524-9331-f86ac444ae09","block_type":"box","text":"Among the income producing securities in which a Fund may invest are credit linked","page_number":52,"box":{"x":287,"y":740,"width":596,"height":11}},{"id":"951747d0-9874-4cba-baf8-0c622414629c","block_type":"box","text":"securities, which are issued by a limited purpose trust or other vehicle that, in turn, invests in a derivative instrument","page_number":52,"box":{"x":69,"y":755,"width":837,"height":11}},{"id":"370753a4-0613-4821-9458-b7a3599f384f","block_type":"box","text":"or basket of derivative instruments, such as credit default swaps, interest rate swaps and other securities, in order","page_number":52,"box":{"x":69,"y":770,"width":823,"height":11}},{"id":"00f07e18-ecad-44e6-8528-f81fec9ea90d","block_type":"box","text":"to provide exposure to cer tain fixed-income markets. For instance, a Fund may invest in credit linked securities as a","page_number":52,"box":{"x":68,"y":785,"width":827,"height":12}},{"id":"519574a9-b1a5-4b78-8071-61afda227d1f","block_type":"box","text":"cash management tool in order to gain exposure to a cer tain market and/or to remain fully invested when more","page_number":52,"box":{"x":69,"y":801,"width":795,"height":11}},{"id":"784738ce-77c5-41cd-8a0b-da9eb1c76618","block_type":"box","text":"traditional income producing securities are not available.","page_number":52,"box":{"x":68,"y":816,"width":404,"height":11}},{"id":"4dcbd509-499f-4902-9ba8-73241b3904e9","block_type":"box","text":"Like an investment in a bond, investments in these credit linked securities represent the right to receive periodic","page_number":52,"box":{"x":102,"y":839,"width":804,"height":11}},{"id":"17966e97-8ac2-4bd6-a772-0e3c8fa96dad","block_type":"box","text":"income payments (in the form of distributions) and payment of principal at the end of the term of the security.","page_number":52,"box":{"x":70,"y":853,"width":780,"height":12}},{"id":"389e56de-f8de-4d86-be18-918b16f95010","block_type":"box","text":"However, these payments are conditioned on the issuer’s receipt of payments from, and the issuer’s potential","page_number":52,"box":{"x":102,"y":876,"width":785,"height":11}},{"id":"405ef4fa-f0f0-4ed6-b771-571764f1ccdc","block_type":"box","text":"obligations to, the counterpar ties to the derivative instruments and other securities in which the issuer invests. For","page_number":52,"box":{"x":69,"y":891,"width":821,"height":12}},{"id":"e64dd411-1847-4950-b993-c7abb8a89bff","block_type":"box","text":"instance, the issuer may sell one or more credit default swaps, under which the issuer would receive a stream of","page_number":52,"box":{"x":70,"y":906,"width":806,"height":12}},{"id":"e0d8584c-5377-48fe-8339-84ea7a7dcac4","block_type":"box","text":"II-8","page_number":52,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"f742f7c3-df2e-4169-9bd2-ee3c325d69ff","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":52,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"89f8e486-8a51-4792-8162-7ac900a13420","block_type":"box","text":"payments over the term of the swap agreements provided that no event of default has occurred with respect to the","page_number":53,"box":{"x":70,"y":45,"width":819,"height":11}},{"id":"126f2d11-e82d-4cbc-b7b4-1f2e28ffbf7f","block_type":"box","text":"referenced debt obligation upon which the swap is based. If a default occurs, the stream of payments may stop and","page_number":53,"box":{"x":69,"y":60,"width":826,"height":11}},{"id":"4cc87c57-45da-4210-a06a-3363d40ca08e","block_type":"box","text":"the issuer would be obligated to pay the counterpar ty the par (or other agreed upon value) of the referenced debt","page_number":53,"box":{"x":68,"y":75,"width":807,"height":11}},{"id":"81d736fd-a23a-4aa0-adf8-0f7a14cd9d3e","block_type":"box","text":"obligation. This, in turn, would reduce the amount of income and principal that a Fund would receive. A Fund’s","page_number":53,"box":{"x":69,"y":90,"width":783,"height":11}},{"id":"c4b2ff29-18dd-4888-bbc6-fcb92c146a2c","block_type":"box","text":"investments in these instruments are indirectly subject to the risks associated with derivative instruments, including,","page_number":53,"box":{"x":70,"y":105,"width":833,"height":11}},{"id":"bb739846-b6ad-47cf-9c99-6ff2b788c7bd","block_type":"box","text":"among others, credit risk, default or similar event risk, counterpar ty risk, interest rate risk, leverage risk and","page_number":53,"box":{"x":69,"y":120,"width":771,"height":12}},{"id":"5557698b-e4f7-41ba-9980-83ef0f6260bc","block_type":"box","text":"management risk. It is also expected that the securities will be exempt from registration under the Securities Act.","page_number":53,"box":{"x":69,"y":135,"width":808,"height":12}},{"id":"aa5f098c-9cfc-4073-afc9-3d52e6e0d468","block_type":"box","text":"Accordingly, there may be no established trading market for the securities and they may constitute illiquid","page_number":53,"box":{"x":68,"y":150,"width":752,"height":12}},{"id":"1f33b966-6cfb-4582-8b46-103f36a4d016","block_type":"box","text":"investments.","page_number":53,"box":{"x":70,"y":166,"width":89,"height":9}},{"id":"60b70a18-7ed7-4182-ad84-5b68bdf707c0","block_type":"box","text":"Debt Securities.","page_number":53,"box":{"x":102,"y":188,"width":116,"height":9}},{"id":"fcefacca-71fe-4af4-8b81-cf0e0e288f89","block_type":"box","text":"Debt securities, such as bonds, involve credit risk. This is the risk that the issuer will not make","page_number":53,"box":{"x":225,"y":188,"width":677,"height":11}},{"id":"e03853ea-6d27-4d98-8e91-f96d225d4464","block_type":"box","text":"timely payments of principal and interest. The degree of credit risk depends on the issuer’s financial condition and on","page_number":53,"box":{"x":68,"y":203,"width":839,"height":12}},{"id":"f5fe57c1-5c0b-4911-b40b-9043f26d1f3a","block_type":"box","text":"the terms of the debt securities. Changes in an issuer’s credit rating or the market’s perception of an issuer’s","page_number":53,"box":{"x":68,"y":218,"width":787,"height":12}},{"id":"a0b267cb-df89-4a01-a86b-978de2b728ea","block_type":"box","text":"creditwor thiness may also affect the value of a Fund’s investment in that issuer. Credit risk is reduced to the extent","page_number":53,"box":{"x":69,"y":234,"width":828,"height":11}},{"id":"e09631f9-1333-4d17-8cf1-5d5812235a21","block_type":"box","text":"a Fund limits its debt investments to U.S. Government Securities.","page_number":53,"box":{"x":69,"y":249,"width":466,"height":9}},{"id":"62f7d524-08ef-44cd-947c-4e3abab17ba0","block_type":"box","text":"All debt securities, however, are subject to interest rate risk. This is the risk that the value of the security may","page_number":53,"box":{"x":101,"y":271,"width":784,"height":12}},{"id":"59d689a8-8124-4086-a9cd-114460dd8cdb","block_type":"box","text":"fall when interest rates rise. If interest rates move sharply in a manner not anticipated by Fund management, a","page_number":53,"box":{"x":68,"y":286,"width":792,"height":12}},{"id":"2a1303e3-ce2d-4728-b4b4-78fdbe666fef","block_type":"box","text":"Fund’s investments in debt securities could be adversely affected and the Fund could lose money. In general, the","page_number":53,"box":{"x":70,"y":302,"width":806,"height":11}},{"id":"7c2773fd-5a3a-4183-850f-c8ee16b6b1ba","block_type":"box","text":"market price of debt securities with longer maturities will go up or down more in response to changes in interest","page_number":53,"box":{"x":69,"y":317,"width":800,"height":11}},{"id":"df9f2c9b-2094-474d-8a2c-a3353c73bcae","block_type":"box","text":"rates than will the market price of shor ter-term debt securities.","page_number":53,"box":{"x":69,"y":332,"width":448,"height":11}},{"id":"1a65fa85-78eb-4db2-82d7-dedab570e963","block_type":"box","text":"During periods of rising interest rates, the average life of cer tain fixed-income securities is extended because of","page_number":53,"box":{"x":102,"y":355,"width":798,"height":11}},{"id":"69014173-de3f-4aff-9311-fede1fb9f5e7","block_type":"box","text":"slower than expected principal payments. This may lock in a below-market interest rate and extend the duration of","page_number":53,"box":{"x":69,"y":370,"width":813,"height":11}},{"id":"c9dd43bc-652e-4f9a-bdeb-7f4c70aa18d9","block_type":"box","text":"these fixed-income securities, especially mor tgage-related securities, making them more sensitive to changes in","page_number":53,"box":{"x":68,"y":385,"width":801,"height":11}},{"id":"2223d837-c26f-4ef5-a36b-59c2393f62be","block_type":"box","text":"interest rates. As a result, in a period of rising interest rates, these securities may exhibit additional volatility and","page_number":53,"box":{"x":70,"y":400,"width":806,"height":11}},{"id":"108d68f0-e6d6-4964-ac79-aad523337041","block_type":"box","text":"lose value. This is known as extension risk.","page_number":53,"box":{"x":70,"y":415,"width":307,"height":9}},{"id":"5d3e809e-f82a-4ccb-ba4b-4d8f57950f0c","block_type":"box","text":"The value of fixed-income securities in the Funds can be expected to vary inversely with changes in prevailing","page_number":53,"box":{"x":101,"y":438,"width":778,"height":11}},{"id":"82bc188c-ce00-4c5e-a68e-08b46e12f38e","block_type":"box","text":"interest rates. Fixed-income securities with longer maturities, which tend to produce higher yields, are subject to","page_number":53,"box":{"x":70,"y":453,"width":798,"height":11}},{"id":"404f34e6-4f2c-47ec-a077-9cc9b1962236","block_type":"box","text":"potentially greater capital appreciation and depreciation than securities with shor ter maturities. The Funds are not","page_number":53,"box":{"x":70,"y":468,"width":812,"height":11}},{"id":"066c8d6b-3e9d-4772-903c-c1b4bbcfbfb7","block_type":"box","text":"restricted to any maximum or minimum time to maturity in purchasing individual por tfolio securities, and the average","page_number":53,"box":{"x":69,"y":483,"width":831,"height":11}},{"id":"37ae0240-4df6-4c2e-9269-71c226683062","block_type":"box","text":"maturity of a Fund’s assets will vary.","page_number":53,"box":{"x":69,"y":498,"width":259,"height":11}},{"id":"6dfedef1-725d-4ae5-b58f-fa21a6e01e14","block_type":"box","text":"Floating and Variable Rate Securities","page_number":53,"box":{"x":102,"y":521,"width":260,"height":11}},{"id":"3615d331-d6c5-41e0-8176-681a6f065832","block_type":"box","text":". Cer tain Funds may invest in debt instruments that pay a variable coupon","page_number":53,"box":{"x":364,"y":521,"width":526,"height":11}},{"id":"b813536f-ddca-4b4c-9939-dd6b69f096ee","block_type":"box","text":"rate. Securities with floating or variable interest rates can be less sensitive to interest rate changes than securities","page_number":53,"box":{"x":69,"y":536,"width":821,"height":11}},{"id":"1215dd8e-b294-4af9-a3b0-038de21af12e","block_type":"box","text":"with fixed interest rates, but may decline in value if their interest rates do not rise as much, or as quickly, as interest","page_number":53,"box":{"x":68,"y":551,"width":834,"height":11}},{"id":"01d5fe66-7974-4bd6-847a-678ba41af9e1","block_type":"box","text":"rates in general. Conversely, floating rate securities will not generally increase in value if interest rates decline. The","page_number":53,"box":{"x":69,"y":566,"width":820,"height":11}},{"id":"0b86d182-326d-4087-bbaa-ee7b8870eadb","block_type":"box","text":"impact of interest rate changes on floating rate investments is typically mitigated by the periodic interest rate reset of","page_number":53,"box":{"x":70,"y":581,"width":838,"height":12}},{"id":"827d5067-b7de-4cf7-8089-a753ad90318a","block_type":"box","text":"the investments. Benchmark interest rates used for floating and variable rate securities may not accurately track","page_number":53,"box":{"x":68,"y":596,"width":804,"height":12}},{"id":"0b042ab3-f3b3-479a-aee2-3efc98fe700f","block_type":"box","text":"market interest rates.","page_number":53,"box":{"x":69,"y":612,"width":153,"height":9}},{"id":"587a88b6-a2d2-4d32-9aa4-29bb220de4d3","block_type":"box","text":"Inflation-Indexed Bonds.","page_number":53,"box":{"x":102,"y":634,"width":169,"height":9}},{"id":"0227e494-7f39-439e-827b-4595551ce26a","block_type":"box","text":"Cer tain Funds may invest in inflation-indexed bonds, which are fixed-income securities or","page_number":53,"box":{"x":278,"y":634,"width":632,"height":11}},{"id":"4a5ee08e-0409-4c8a-87f3-150710416975","block_type":"box","text":"other instruments whose principal value is periodically adjusted according to the rate of inflation. Two structures are","page_number":53,"box":{"x":69,"y":649,"width":828,"height":12}},{"id":"c0f3e38e-60d1-46ce-9325-943c4200bb17","block_type":"box","text":"common. The U.S. Treasury and some other issuers use a structure that accrues inflation into the principal value of","page_number":53,"box":{"x":69,"y":664,"width":827,"height":12}},{"id":"72b3a2ce-581f-47e5-a4e3-2b3b969afd20","block_type":"box","text":"the bond. Most other issuers pay out the Consumer Price Index (“CPI”) accruals as par t of a semi-annual coupon.","page_number":53,"box":{"x":68,"y":680,"width":810,"height":11}},{"id":"866a4c92-e5db-4fba-a8d0-d75ad00e3d1a","block_type":"box","text":"Inflation-indexed securities issued by the U.S. Treasury have maturities of five, ten or thir ty years, although it is","page_number":53,"box":{"x":102,"y":702,"width":792,"height":12}},{"id":"34c20016-d67b-42ab-a19a-47b7ec61c09c","block_type":"box","text":"possible that securities with other maturities will be issued in the future. The U.S. Treasury securities pay interest on","page_number":53,"box":{"x":70,"y":717,"width":833,"height":12}},{"id":"c98341c0-7aa0-4243-aaa4-03bb6dbcf7ff","block_type":"box","text":"a semi-annual basis, equal to a fixed percentage of the inflation-adjusted principal amount. For example, if a Fund","page_number":53,"box":{"x":69,"y":732,"width":810,"height":12}},{"id":"a3833fd9-2e73-4f3c-b7c8-0d40a0c70deb","block_type":"box","text":"purchased an inflation-indexed bond with a par value of $1,000 and a 3% real rate of return coupon (payable 1.5%","page_number":53,"box":{"x":70,"y":747,"width":814,"height":12}},{"id":"2c3f1485-e492-46c8-af36-f56509fd4637","block_type":"box","text":"semi-annually), and inflation over the first six months was 1%, the mid-year par value of the bond would be $1,010","page_number":53,"box":{"x":69,"y":762,"width":816,"height":12}},{"id":"7aa2dd10-22db-4eff-9d96-8ea47504e2af","block_type":"box","text":"and the first semi-annual interest payment would be $15.15 ($1,010 times 1.5%). If inflation during the second half","page_number":53,"box":{"x":69,"y":777,"width":828,"height":12}},{"id":"4416a63e-b1f2-4d2d-ae5f-954505dc3bb2","block_type":"box","text":"of the year resulted in the whole year’s inflation equaling 3%, the end-of-year par value of the bond would be $1,030","page_number":53,"box":{"x":69,"y":792,"width":828,"height":12}},{"id":"f8736a98-917b-4728-9861-48dfca6a971d","block_type":"box","text":"and the second semi-annual interest payment would be $15.45 ($1,030 times 1.5%).","page_number":53,"box":{"x":69,"y":807,"width":610,"height":12}},{"id":"73dec22a-4db6-47f8-a2c9-f24eaaa80015","block_type":"box","text":"If the periodic adjustment rate measuring inflation falls, the principal value of inflation-indexed bonds will be","page_number":53,"box":{"x":102,"y":831,"width":767,"height":11}},{"id":"9413e09a-eb4c-4e19-b23a-3d86f902413d","block_type":"box","text":"adjusted downward, and, consequently, the interest payable on these securities (calculated with respect to a smaller","page_number":53,"box":{"x":69,"y":846,"width":833,"height":11}},{"id":"a846cd99-f734-41e0-937e-f2b44e9916fe","block_type":"box","text":"principal amount) will be reduced. Repayment of the original bond principal upon maturity (as adjusted for inflation) is","page_number":53,"box":{"x":70,"y":861,"width":834,"height":11}},{"id":"59043c6e-9129-4306-86fa-610c7c00fab7","block_type":"box","text":"guaranteed in the case of U.S. Treasury inflation-indexed bonds, even during a period of deflation. However, the","page_number":53,"box":{"x":68,"y":876,"width":795,"height":11}},{"id":"759fe7c6-4916-4aa5-b2d5-e4eaba157609","block_type":"box","text":"current market value of the bonds is not guaranteed, and will fluctuate. Cer tain Funds may also invest in other","page_number":53,"box":{"x":69,"y":891,"width":788,"height":12}},{"id":"28012115-c9a9-4616-953f-9115c5965d69","block_type":"box","text":"inflation related bonds which may or may not provide a similar guarantee. If a guarantee of principal is not provided,","page_number":53,"box":{"x":70,"y":906,"width":823,"height":12}},{"id":"c588d60c-5ba0-4983-9cdd-0798a512748c","block_type":"box","text":"II-9","page_number":53,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"a2d110a4-777c-4466-ae58-7ba3c49a42ec","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":53,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"e1421657-472a-476a-9f5c-18fd3384a74d","block_type":"box","text":"the adjusted principal value of the bond repaid at maturity may be less than the original principal. In addition, if the","page_number":54,"box":{"x":68,"y":45,"width":821,"height":11}},{"id":"bbaa6b25-6a7a-4f1a-a097-9c52d844614b","block_type":"box","text":"Fund purchases inflation-indexed bonds offered by foreign issuers, the rate of inflation measured by the foreign","page_number":54,"box":{"x":70,"y":60,"width":792,"height":11}},{"id":"8c77dff4-bf77-4558-82e1-03abebf5276d","block_type":"box","text":"inflation index may not be correlated to the rate of inflation in the United States.","page_number":54,"box":{"x":70,"y":75,"width":570,"height":11}},{"id":"82304230-cc36-4d32-9fd8-52e0a780262e","block_type":"box","text":"The value of inflation-indexed bonds is expected to change in response to changes in real interest rates. Real","page_number":54,"box":{"x":101,"y":98,"width":780,"height":11}},{"id":"b051c525-599c-41ac-a96d-c1a1a2d23b4f","block_type":"box","text":"interest rates, in turn, are tied to the relationship between nominal interest rates and the rate of inflation. Therefore,","page_number":54,"box":{"x":70,"y":113,"width":831,"height":11}},{"id":"8d028c27-e9d0-4cd0-a6b0-afdb558be739","block_type":"box","text":"if inflation were to rise at a faster rate than nominal interest rates, real interest rates might decline, leading to an","page_number":54,"box":{"x":70,"y":128,"width":808,"height":11}},{"id":"e67c78e8-dfd4-4626-93b5-f175e445c221","block_type":"box","text":"increase in value of inflation-indexed bonds. In contrast, if nominal interest rates increased at a faster rate than","page_number":54,"box":{"x":70,"y":143,"width":796,"height":10}},{"id":"81d01d7f-2a99-49be-a33d-5cb683b08241","block_type":"box","text":"inflation, real interest rates might rise, leading to a decrease in value of inflation-indexed bonds. There can be no","page_number":54,"box":{"x":70,"y":158,"width":805,"height":11}},{"id":"0f02e980-6054-4db5-a794-4fa88f992664","block_type":"box","text":"assurance, however, that the value of inflation-indexed bonds will be directly correlated to changes in interest rates.","page_number":54,"box":{"x":69,"y":173,"width":824,"height":11}},{"id":"c765a5f0-e790-4683-9288-554dc77fb6b8","block_type":"box","text":"While these securities are expected to be protected from long-term inflationary trends, shor t-term increases in","page_number":54,"box":{"x":101,"y":196,"width":788,"height":11}},{"id":"9c561170-61ef-425f-ad7b-aed43c0ddc50","block_type":"box","text":"inflation may lead to a decline in value. If interest rates rise due to reasons other than inflation (for example, due to","page_number":54,"box":{"x":70,"y":211,"width":825,"height":11}},{"id":"670f79b5-194d-4bca-8668-28e08db75fd1","block_type":"box","text":"changes in currency exchange rates), investors in these securities may not be protected to the extent that the","page_number":54,"box":{"x":69,"y":226,"width":784,"height":11}},{"id":"f5fb3c14-b1b7-442d-85e3-0798cf8c84ed","block_type":"box","text":"increase is not reflected in the bond’s inflation measure.","page_number":54,"box":{"x":70,"y":241,"width":403,"height":9}},{"id":"600184cc-cb4b-4b71-bfac-d72128e2df01","block_type":"box","text":"In general, the measure used to determine the periodic adjustment of U.S. inflation-indexed bonds is the","page_number":54,"box":{"x":102,"y":264,"width":746,"height":11}},{"id":"d8b4fd60-8f53-4cc8-8848-0cbef43092ae","block_type":"box","text":"Consumer Price Index for Urban Consumers (“CPI-U”), which is calculated monthly by the U.S. Bureau of Labor","page_number":54,"box":{"x":69,"y":279,"width":786,"height":11}},{"id":"b23992ea-7d7f-4344-ad54-c4cf1010e6f7","block_type":"box","text":"Statistics. The CPI-U is a measurement of changes in the cost of living, made up of components such as housing,","page_number":54,"box":{"x":69,"y":294,"width":810,"height":11}},{"id":"ddbb8f1b-ce13-4244-a2e4-06a53a818f39","block_type":"box","text":"food, transpor tation and energy. Inflation-indexed bonds issued by a foreign government are generally adjusted to","page_number":54,"box":{"x":68,"y":309,"width":809,"height":11}},{"id":"e353925d-49bf-4610-bdbd-3f071920ff96","block_type":"box","text":"reflect a comparable inflation index, calculated by that government. There can be no assurance that the CPI-U or any","page_number":54,"box":{"x":69,"y":324,"width":830,"height":12}},{"id":"3e6dc3ca-c99f-4eab-9493-1d6a4d140a88","block_type":"box","text":"foreign inflation index will accurately measure the real rate of inflation in the prices of goods and services. Moreover,","page_number":54,"box":{"x":68,"y":339,"width":833,"height":12}},{"id":"88c45265-9d71-4ca7-abee-f1409c79e29c","block_type":"box","text":"there can be no assurance that the rate of inflation in a foreign country will be correlated to the rate of inflation in the","page_number":54,"box":{"x":68,"y":355,"width":840,"height":11}},{"id":"5ad2c20f-1f78-4f03-aedd-87fc48cbb334","block_type":"box","text":"United States.","page_number":54,"box":{"x":70,"y":370,"width":99,"height":9}},{"id":"cca11f17-49cf-4375-bfa6-297b4f46db11","block_type":"box","text":"Any increase in the principal amount of an inflation-indexed bond will be considered taxable ordinary income,","page_number":54,"box":{"x":101,"y":392,"width":774,"height":12}},{"id":"6f669e94-44c2-4ecb-816e-507fecc59797","block_type":"box","text":"even though investors do not receive their principal until maturity.","page_number":54,"box":{"x":69,"y":408,"width":464,"height":11}},{"id":"0dc2f356-2c32-4131-86d5-a5e7b1723339","block_type":"box","text":"Investment Grade Debt Obligations.","page_number":54,"box":{"x":102,"y":430,"width":252,"height":11}},{"id":"21ce1bda-264d-4de3-b969-b89fd14e6277","block_type":"box","text":"Cer tain Funds may invest in “investment grade securities,” which are","page_number":54,"box":{"x":360,"y":430,"width":493,"height":11}},{"id":"a1d737e8-56e1-4403-8230-7bcf7a751da9","block_type":"box","text":"securities rated in the four highest rating categories of an NRSRO or deemed to be of equivalent quality by a Fund’s","page_number":54,"box":{"x":69,"y":445,"width":823,"height":12}},{"id":"a41fffab-01d7-4bf1-bcac-1a0ecd94fa99","block_type":"box","text":"Manager. Cer tain Funds may invest in debt securities rated Aaa by Moody’s or AAA by S&P. It should be noted that","page_number":54,"box":{"x":70,"y":460,"width":815,"height":12}},{"id":"8674a2fd-69b5-41b0-91ed-bf23972d8314","block_type":"box","text":"debt obligations rated in the lowest of the top four ratings (","page_number":54,"box":{"x":69,"y":475,"width":420,"height":12}},{"id":"4d210563-6cd3-43b7-a864-7fb01ce0315a","block_type":"box","text":"i.e.","page_number":54,"box":{"x":492,"y":476,"width":20,"height":8}},{"id":"1c2a8b9e-b572-4bc3-9431-b66914022ea0","block_type":"box","text":", “Baa” by Moody’s or “BBB” by S&P) are considered","page_number":54,"box":{"x":514,"y":476,"width":377,"height":11}},{"id":"9647120d-2902-49fe-b6ed-2bb1ca38653a","block_type":"box","text":"to have some speculative characteristics and are more sensitive to economic change than higher rated securities. If","page_number":54,"box":{"x":68,"y":491,"width":829,"height":11}},{"id":"e4cbf885-6ba7-4a36-bbf3-6326e82b197c","block_type":"box","text":"an investment grade security of a Fund is subsequently downgraded below investment grade, the Fund’s Manager will","page_number":54,"box":{"x":69,"y":506,"width":836,"height":11}},{"id":"9489895a-bf02-4cf2-98ba-15309e282072","block_type":"box","text":"consider such an event in determining whether the Fund should continue to hold the security. Subject to its","page_number":54,"box":{"x":69,"y":521,"width":763,"height":11}},{"id":"8de97fcb-c30c-43ae-91cf-6412cbd40641","block_type":"box","text":"investment strategies, there is no limit on the amount of such downgraded securities a Fund may hold.","page_number":54,"box":{"x":70,"y":536,"width":731,"height":11}},{"id":"2d154117-4d85-4047-b026-041f00a71c39","block_type":"box","text":"See Appendix A to this SAI for a description of applicable securities ratings.","page_number":54,"box":{"x":102,"y":559,"width":536,"height":11}},{"id":"a074cea0-8114-4047-bd08-a5bf73d19401","block_type":"box","text":"High Yield Investments (“Junk Bonds”).","page_number":54,"box":{"x":102,"y":582,"width":278,"height":11}},{"id":"fd0f8b65-a36d-4654-852b-acf475481459","block_type":"box","text":"Non-investment grade or “high yield” fixed-income or conver tible securities commonly known to investors as","page_number":54,"box":{"x":102,"y":604,"width":767,"height":11}},{"id":"829bab12-9443-47c9-bc91-c73d1ddeaea7","block_type":"box","text":"“junk bonds” are debt securities that are rated below investment grade by the major rating agencies or are securities","page_number":54,"box":{"x":70,"y":619,"width":834,"height":11}},{"id":"2acaeab6-de7b-4b59-9006-182448ce0ced","block_type":"box","text":"that Fund management believes are of comparable quality. While generally providing greater income and oppor tunity","page_number":54,"box":{"x":68,"y":634,"width":828,"height":12}},{"id":"ca6cdabd-a4d3-444a-99f7-c28743921f21","block_type":"box","text":"for gain, non-investment grade debt securities may be subject to greater risks than securities which have higher credit","page_number":54,"box":{"x":68,"y":649,"width":841,"height":12}},{"id":"101f8e25-3352-411c-9028-a55872d50e1f","block_type":"box","text":"ratings, including a high risk of default, and their yields will fluctuate over time. High yield securities will generally be","page_number":54,"box":{"x":69,"y":664,"width":827,"height":12}},{"id":"f983a68f-22ad-4f63-a343-16ebbe70546d","block_type":"box","text":"in the lower rating categories of recognized rating agencies (rated “Ba” or lower by Moody’s or “BB” or lower by S&P)","page_number":54,"box":{"x":70,"y":680,"width":830,"height":11}},{"id":"7f2c8ea7-94cb-474b-b1aa-49614a99d0c2","block_type":"box","text":"or will be non-rated. The credit rating of a high yield security does not necessarily address its market value risk, and","page_number":54,"box":{"x":69,"y":695,"width":824,"height":11}},{"id":"ce214f8a-1c68-465b-a28b-008a6fbd8b0c","block_type":"box","text":"ratings may from time to time change, positively or negatively, to reflect developments regarding the issuer’s financial","page_number":54,"box":{"x":69,"y":710,"width":838,"height":11}},{"id":"035f799f-3629-4e5d-8259-3c434bbcde7a","block_type":"box","text":"condition. High yield securities are considered to be speculative with respect to the capacity of the issuer to timely","page_number":54,"box":{"x":69,"y":725,"width":817,"height":11}},{"id":"4fc23432-d97e-4429-8df9-9c9c71f81b42","block_type":"box","text":"repay principal and pay interest or dividends in accordance with the terms of the obligation and may have more credit","page_number":54,"box":{"x":69,"y":740,"width":837,"height":11}},{"id":"d9644570-cf68-4d02-9638-59a92c066607","block_type":"box","text":"risk than higher rated securities.","page_number":54,"box":{"x":69,"y":755,"width":230,"height":11}},{"id":"65ba70ca-4879-46b2-9060-95257eaac87f","block_type":"box","text":"The major risks in junk bond investments include the following:","page_number":54,"box":{"x":101,"y":778,"width":447,"height":11}},{"id":"b0e75a8d-edc3-41ce-ac11-e4295c1f1572","block_type":"box","text":"•","page_number":54,"box":{"x":69,"y":801,"width":6,"height":4}},{"id":"1f6f2f87-74a8-488e-a35a-75f8c1e74068","block_type":"box","text":"Junk bonds may be issued by less creditwor thy companies. These securities are vulnerable to adverse changes","page_number":54,"box":{"x":101,"y":798,"width":796,"height":11}},{"id":"b04858a6-92ba-4eba-a351-75241df88c13","block_type":"box","text":"in the issuer’s industry and to general economic conditions. Issuers of junk bonds may be unable to meet their","page_number":54,"box":{"x":102,"y":813,"width":792,"height":11}},{"id":"2fd19aff-9b8b-46a9-a4d8-8a3dd19db49e","block_type":"box","text":"interest or principal payment obligations because of an economic downturn, specific issuer developments or the","page_number":54,"box":{"x":102,"y":828,"width":799,"height":12}},{"id":"ffcd0551-f6ea-40da-a44f-2be9108f9dc8","block_type":"box","text":"unavailability of additional financing.","page_number":54,"box":{"x":102,"y":843,"width":256,"height":12}},{"id":"7cacab6f-59ef-4c99-91df-3c80115eb415","block_type":"box","text":"•","page_number":54,"box":{"x":69,"y":866,"width":6,"height":5}},{"id":"7a937ab1-20ac-485d-8309-bb0544aa4451","block_type":"box","text":"The issuers of junk bonds may have a larger amount of outstanding debt relative to their assets than issuers of","page_number":54,"box":{"x":101,"y":863,"width":797,"height":12}},{"id":"fae45b22-2e5d-4472-ba14-827b3c70c9a9","block_type":"box","text":"investment grade bonds. If the issuer experiences financial stress, it may be unable to meet its debt obligations.","page_number":54,"box":{"x":102,"y":879,"width":804,"height":11}},{"id":"8048c91b-796d-4d4a-a975-7328f8d58612","block_type":"box","text":"The issuer’s ability to pay its debt obligations also may be lessened by specific issuer developments, or the","page_number":54,"box":{"x":101,"y":894,"width":769,"height":11}},{"id":"e7ff8c81-e751-416c-8cb8-258ba8a18ebe","block_type":"box","text":"II-10","page_number":54,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"509d1970-6e3f-4f5d-af2c-c75b5e1d1212","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":54,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"4b523b56-a7b2-441c-b38c-2aff44c4c818","block_type":"box","text":"unavailability of additional financing. Issuers of high yield securities are often in the growth stage of their","page_number":55,"box":{"x":102,"y":45,"width":746,"height":11}},{"id":"e33ba0ca-059e-462c-be9c-50227347b581","block_type":"box","text":"development and/or involved in a reorganization or takeover.","page_number":55,"box":{"x":101,"y":60,"width":432,"height":11}},{"id":"948b77c8-a078-4572-9a35-fe1d5cb1156c","block_type":"box","text":"•","page_number":55,"box":{"x":69,"y":83,"width":6,"height":4}},{"id":"fd8ac9f8-dba1-4702-94e4-018d6d23ff54","block_type":"box","text":"Junk bonds are frequently ranked junior to claims by other creditors. If the issuer cannot meet its obligations, the","page_number":55,"box":{"x":101,"y":80,"width":808,"height":11}},{"id":"e612b089-ae19-4cee-ae5a-414c9b22e7b9","block_type":"box","text":"senior obligations are generally paid off before the junior obligations, which will potentially limit a Fund’s ability","page_number":55,"box":{"x":102,"y":95,"width":789,"height":11}},{"id":"25d3e3ce-5a4f-4005-9cd2-423ae489d17b","block_type":"box","text":"to fully recover principal or to receive interest payments when senior securities are in default. Thus, investors in","page_number":55,"box":{"x":101,"y":110,"width":796,"height":11}},{"id":"bc811991-c18e-45fc-8b58-d70f1adac1e0","block_type":"box","text":"high yield securities have a lower degree of protection with respect to principal and interest payments than do","page_number":55,"box":{"x":102,"y":125,"width":782,"height":12}},{"id":"db3869a0-814d-4338-ba5f-c036cd750a15","block_type":"box","text":"investors in higher rated securities.","page_number":55,"box":{"x":102,"y":141,"width":249,"height":11}},{"id":"94b3c706-d7b8-4c16-b3d6-8312fc7829b7","block_type":"box","text":"•","page_number":55,"box":{"x":69,"y":163,"width":6,"height":5}},{"id":"f1aa7fb0-27b9-47c9-93f0-dd8f3feb1df6","block_type":"box","text":"Junk bonds frequently have redemption features that permit an issuer to repurchase the security from a Fund","page_number":55,"box":{"x":101,"y":161,"width":780,"height":11}},{"id":"2f10eeac-0c65-4cd5-b552-783bff54a004","block_type":"box","text":"before it matures. If an issuer redeems the junk bonds, a Fund may have to invest the proceeds in bonds with","page_number":55,"box":{"x":102,"y":176,"width":784,"height":11}},{"id":"6a271af2-4c06-44cb-ac06-4661f737f208","block_type":"box","text":"lower yields and may lose income.","page_number":55,"box":{"x":102,"y":191,"width":242,"height":11}},{"id":"43527f84-a8a6-4d8d-87a1-573d04ddffe0","block_type":"box","text":"•","page_number":55,"box":{"x":69,"y":214,"width":6,"height":4}},{"id":"629a3d90-2acd-4e61-9b55-7a34b7836013","block_type":"box","text":"Prices of junk bonds are subject to extreme price fluctuations. Negative economic developments may have a","page_number":55,"box":{"x":102,"y":211,"width":772,"height":11}},{"id":"115802e2-d749-4170-a35c-42d2f41a2bbc","block_type":"box","text":"greater impact on the prices of junk bonds than on those of other higher rated fixed-income securities.","page_number":55,"box":{"x":101,"y":226,"width":729,"height":11}},{"id":"f6b7fea1-7f21-4b65-a2cc-b0bbbe700915","block_type":"box","text":"•","page_number":55,"box":{"x":69,"y":249,"width":6,"height":5}},{"id":"c3ae9dd2-983f-44ba-93ec-bdb728b06a18","block_type":"box","text":"Junk bonds may be less liquid than higher rated fixed-income securities even under normal economic conditions.","page_number":55,"box":{"x":101,"y":246,"width":802,"height":11}},{"id":"1fe78054-f67f-48a4-aa5c-6dbac9446eaf","block_type":"box","text":"Under cer tain economic and/or market conditions, a Fund may have difficulty disposing of cer tain high yield","page_number":55,"box":{"x":102,"y":261,"width":768,"height":12}},{"id":"8fe26576-f7a8-4c89-a785-79de950abcac","block_type":"box","text":"securities due to the limited number of investors in that sector of the market. There are fewer dealers in the junk","page_number":55,"box":{"x":102,"y":276,"width":805,"height":12}},{"id":"8f73d9d9-30a7-4910-a922-aabdb4ccdbb1","block_type":"box","text":"bond market, and there may be significant differences in the prices quoted for junk bonds by the dealers, and","page_number":55,"box":{"x":102,"y":292,"width":781,"height":11}},{"id":"6f591b73-ebe0-42b9-94a0-8a66e9a2751b","block_type":"box","text":"such quotations may not be the actual prices available for a purchase or sale. Because junk bonds are less","page_number":55,"box":{"x":102,"y":307,"width":767,"height":11}},{"id":"05eb00b2-9479-445d-860b-fdc477837b21","block_type":"box","text":"liquid than higher rated bonds, judgment may play a greater role in valuing cer tain of a Fund’s por tfolio securities","page_number":55,"box":{"x":102,"y":322,"width":806,"height":11}},{"id":"a06b9603-a4a1-463f-902c-63b91496cd39","block_type":"box","text":"than in the case of securities trading in a more liquid market.","page_number":55,"box":{"x":101,"y":337,"width":436,"height":11}},{"id":"6a35ced6-3fd8-45ab-879f-eb4f561588ae","block_type":"box","text":"•","page_number":55,"box":{"x":69,"y":360,"width":6,"height":5}},{"id":"c6ce7bca-79cc-4824-bc4b-119918299471","block_type":"box","text":"The secondary markets for high yield securities are not as liquid as the secondary markets for higher rated","page_number":55,"box":{"x":101,"y":357,"width":763,"height":11}},{"id":"273bc464-1f3e-4fe4-ada6-9408055fd8d1","block_type":"box","text":"securities. The secondary markets for high yield securities are concentrated in relatively few market makers and","page_number":55,"box":{"x":102,"y":372,"width":798,"height":11}},{"id":"65a5befe-8dc0-4ec8-b07a-8d5afc869225","block_type":"box","text":"par ticipants in the markets are mostly institutional investors, including insurance companies, banks, other","page_number":55,"box":{"x":102,"y":388,"width":759,"height":11}},{"id":"160476d7-0ac4-4373-9fdd-89a2ddfafd23","block_type":"box","text":"financial institutions and mutual funds. In addition, the trading volume for high yield securities is generally lower","page_number":55,"box":{"x":101,"y":402,"width":798,"height":12}},{"id":"8f2aa86a-99e2-4bdc-8548-106f906ff8bc","block_type":"box","text":"than that for higher rated securities and the secondary markets could contract under adverse market or","page_number":55,"box":{"x":101,"y":418,"width":739,"height":11}},{"id":"60ce52f1-4d39-486d-993b-54f328ab8ab2","block_type":"box","text":"economic conditions independent of any specific adverse changes in the condition of a par ticular issuer. Under","page_number":55,"box":{"x":101,"y":433,"width":792,"height":11}},{"id":"3d01ab2b-7ea3-4c60-9f2b-32d169916839","block_type":"box","text":"cer tain economic and/or market conditions, a Fund may have difficulty disposing of cer tain high yield securities","page_number":55,"box":{"x":101,"y":448,"width":797,"height":11}},{"id":"52b131f2-ef95-4f7b-9790-e344e10108f8","block_type":"box","text":"due to the limited number of investors in that sector of the market. An illiquid secondary market may adversely","page_number":55,"box":{"x":101,"y":463,"width":791,"height":11}},{"id":"b6160cb9-c141-45d2-ad45-eee55a8e4aa3","block_type":"box","text":"affect the market price of the high yield security, which may result in increased difficulty selling the par ticular","page_number":55,"box":{"x":102,"y":478,"width":777,"height":11}},{"id":"4177b6d7-4423-4f96-91d6-92f50c97a765","block_type":"box","text":"issue and obtaining accurate market quotations on the issue when valuing a Fund’s assets. Market quotations","page_number":55,"box":{"x":102,"y":493,"width":788,"height":11}},{"id":"cc32a9b4-d83e-49e2-886d-b7b195eb2280","block_type":"box","text":"on high yield securities are available only from a limited number of dealers, and such quotations may not be the","page_number":55,"box":{"x":102,"y":508,"width":797,"height":12}},{"id":"f3243cf0-a3ce-4ede-9b6f-26ba688239ff","block_type":"box","text":"actual prices available for a purchase or sale. When the secondary market for high yield securities becomes","page_number":55,"box":{"x":102,"y":523,"width":769,"height":12}},{"id":"81a96e9f-7772-4bee-8dd3-b4fd3e9afdb9","block_type":"box","text":"more illiquid, or in the absence of readily available market quotations for such securities, the relative lack of","page_number":55,"box":{"x":102,"y":538,"width":772,"height":12}},{"id":"7c5e1bde-f19d-4b4c-b393-1915f4f4c824","block_type":"box","text":"reliable objective data makes it more difficult to value a Fund’s securities, and judgment plays a more impor tant","page_number":55,"box":{"x":102,"y":554,"width":801,"height":11}},{"id":"cab40622-1055-40ce-a34b-99eacc4e2754","block_type":"box","text":"role in determining such valuations.","page_number":55,"box":{"x":102,"y":569,"width":252,"height":11}},{"id":"8fa86954-a542-48bd-b2c6-67de24bddfb3","block_type":"box","text":"•","page_number":55,"box":{"x":69,"y":592,"width":6,"height":4}},{"id":"8e9494f5-0d0d-46ce-9e68-a1342715a1fe","block_type":"box","text":"A Fund may incur expenses to the extent necessary to seek recovery upon default or to negotiate new terms with","page_number":55,"box":{"x":101,"y":589,"width":808,"height":11}},{"id":"33e75bba-fdc1-4c20-b1ea-b1eb92fdba43","block_type":"box","text":"a defaulting issuer.","page_number":55,"box":{"x":102,"y":604,"width":134,"height":11}},{"id":"ce712d15-831f-4047-9c14-8f3162125d9b","block_type":"box","text":"•","page_number":55,"box":{"x":69,"y":627,"width":6,"height":5}},{"id":"d08982f1-e179-4d96-95d7-e1a33a27f982","block_type":"box","text":"The junk bond markets may react strongly to adverse news about an issuer or the economy, or to the perception","page_number":55,"box":{"x":101,"y":624,"width":800,"height":11}},{"id":"767e9e86-80e9-4ff4-ac62-53039ac1c9d0","block_type":"box","text":"or expectation of adverse news, whether or not it is based on fundamental analysis. Additionally, prices for high","page_number":55,"box":{"x":102,"y":639,"width":793,"height":12}},{"id":"205fe793-ab69-4c9d-90db-c3ddd7e3be14","block_type":"box","text":"yield securities may be affected by legislative and regulatory developments. These developments could adversely","page_number":55,"box":{"x":101,"y":654,"width":808,"height":12}},{"id":"3e836a02-c72e-4eb5-bab3-c097ee1bfa29","block_type":"box","text":"affect a Fund’s NAV and investment practices, the secondary market for high yield securities, the financial","page_number":55,"box":{"x":102,"y":669,"width":756,"height":12}},{"id":"e23761bc-cecb-46e0-a72a-92b058009843","block_type":"box","text":"condition of issuers of these securities and the value and liquidity of outstanding high yield securities, especially","page_number":55,"box":{"x":101,"y":685,"width":803,"height":11}},{"id":"9478559b-015b-4725-beb7-9a6794ee176d","block_type":"box","text":"in a thinly traded market. For example, federal legislation requiring the divestiture by federally insured savings","page_number":55,"box":{"x":102,"y":700,"width":781,"height":11}},{"id":"f4595b2e-5550-4b54-90d3-1e5346f82356","block_type":"box","text":"and loan associations of their investments in high yield bonds and limiting the deductibility of interest by cer tain","page_number":55,"box":{"x":102,"y":715,"width":798,"height":11}},{"id":"53e97e35-342e-403a-a948-f5ea587b9175","block_type":"box","text":"corporate issuers of high yield bonds adversely affected the market in the past.","page_number":55,"box":{"x":101,"y":730,"width":566,"height":11}},{"id":"574a64b5-ed9e-4520-a732-36c7b01a42a5","block_type":"box","text":"•","page_number":55,"box":{"x":69,"y":753,"width":6,"height":5}},{"id":"30a3fbf7-bbe5-49bf-8863-b3a5ada7f164","block_type":"box","text":"The rating assigned by a rating agency evaluates the issuing agency’s assessment of the safety of a non","page_number":55,"box":{"x":101,"y":750,"width":751,"height":11}},{"id":"949cf0a5-f6c3-42c4-9c8f-f0e041749bb2","block_type":"box","text":"investment grade security’s principal and interest payments, but does not address market value risk. Because","page_number":55,"box":{"x":102,"y":766,"width":786,"height":11}},{"id":"50534d77-1393-42e1-932d-671fdafd0fa9","block_type":"box","text":"such ratings of the ratings agencies may not always reflect current conditions and events, in addition to using","page_number":55,"box":{"x":102,"y":780,"width":782,"height":12}},{"id":"e5c401fa-967a-418b-a647-03f2555431b2","block_type":"box","text":"recognized rating agencies and other sources, the Manager or sub-adviser per forms its own analysis of the","page_number":55,"box":{"x":102,"y":795,"width":762,"height":12}},{"id":"b1389951-8498-4998-8fef-52030e8d1a2d","block_type":"box","text":"issuers whose non-investment grade securities a Fund holds. Because of this, the Fund’s per formance may","page_number":55,"box":{"x":102,"y":811,"width":767,"height":11}},{"id":"eda549e3-aace-4fe4-8ef6-b3a03de46044","block_type":"box","text":"depend more on the Manager’s or sub-adviser’s own credit analysis than in the case of mutual funds investing in","page_number":55,"box":{"x":101,"y":826,"width":806,"height":11}},{"id":"17c87130-4ac3-48f4-bb8b-bafa835105bb","block_type":"box","text":"higher-rated securities.","page_number":55,"box":{"x":102,"y":841,"width":161,"height":11}},{"id":"c3e60922-1e19-4c9f-aed5-649d1dfb3af9","block_type":"box","text":"In selecting non-investment grade securities, the Manager or sub-adviser considers factors such as those","page_number":55,"box":{"x":102,"y":863,"width":751,"height":12}},{"id":"bc930141-2a07-442c-92eb-6cb9e3db26e4","block_type":"box","text":"relating to the creditwor thiness of issuers, the ratings and per formance of the securities, the protections afforded","page_number":55,"box":{"x":69,"y":879,"width":814,"height":11}},{"id":"57cec236-e33c-4987-963e-45e65f75f525","block_type":"box","text":"the securities and the diversity of the Fund. The Manager or sub-adviser continuously monitors the issuers of non","page_number":55,"box":{"x":68,"y":894,"width":812,"height":11}},{"id":"96d07d75-d637-487d-a0ed-4d392578d680","block_type":"box","text":"investment grade securities held by the Fund for their ability to make required principal and interest payments, as","page_number":55,"box":{"x":70,"y":909,"width":808,"height":11}},{"id":"d58b6f66-2626-4776-a4b5-eb1afee8652a","block_type":"box","text":"II-11","page_number":55,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"06d58b5a-8c17-4643-a035-7056ed6b6184","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":55,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"2f192774-9220-4676-a51c-3b17af5b4e59","block_type":"box","text":"well as in an effor t to control the liquidity of the Fund so that it can meet redemption requests. If a security’s rating","page_number":56,"box":{"x":68,"y":45,"width":825,"height":11}},{"id":"dbc6a2c1-1d5a-4bf5-b86c-24949b21a9d8","block_type":"box","text":"is reduced below the minimum credit rating that is permitted for a Fund, the Fund’s adviser or sub-adviser will","page_number":56,"box":{"x":70,"y":60,"width":779,"height":11}},{"id":"2a8b9bed-71e5-450a-bfa1-f3114b4a08d2","block_type":"box","text":"consider whether the Fund should continue to hold the security.","page_number":56,"box":{"x":69,"y":75,"width":451,"height":11}},{"id":"71bf6549-d33f-498b-9b49-97f73b4eac59","block_type":"box","text":"In the event that a Fund investing in high yield securities experiences an unexpected level of net redemptions,","page_number":56,"box":{"x":102,"y":98,"width":782,"height":11}},{"id":"833d2162-07e3-4a1d-a0f0-8dee3c76625c","block_type":"box","text":"the Fund could be forced to sell its holdings without regard to the investment merits, thereby decreasing the assets","page_number":56,"box":{"x":68,"y":113,"width":825,"height":11}},{"id":"d6f1f380-1b6c-4f06-b5bc-2c087a53892e","block_type":"box","text":"upon which the Fund’s rate of return is based.","page_number":56,"box":{"x":69,"y":128,"width":328,"height":11}},{"id":"4b32744c-95f8-42b6-82fa-24a96c152f04","block_type":"box","text":"The costs attributable to investing in the junk bond markets are usually higher for several reasons, such as","page_number":56,"box":{"x":101,"y":150,"width":764,"height":12}},{"id":"9d974278-bbc2-416d-93a7-cc960f115e74","block_type":"box","text":"higher investment research costs and higher commission costs.","page_number":56,"box":{"x":69,"y":166,"width":455,"height":11}},{"id":"6d7dfe10-3be0-4535-9bc8-5f056b85986e","block_type":"box","text":"Mezzanine Investments.","page_number":56,"box":{"x":102,"y":188,"width":170,"height":9}},{"id":"77ea758d-ab7c-4bdd-bd64-bcc42dd2bbe1","block_type":"box","text":"Cer tain Funds, consistent with their restrictions on investing in securities of a specific","page_number":56,"box":{"x":279,"y":188,"width":612,"height":12}},{"id":"4ec58f21-4cde-4eed-92bb-95967f38b8f7","block_type":"box","text":"credit quality, may invest in cer tain high yield securities known as mezzanine investments, which are subordinated","page_number":56,"box":{"x":69,"y":204,"width":813,"height":11}},{"id":"9e720401-896a-46c7-a2da-d030efdf8cb4","block_type":"box","text":"debt securities which are generally issued in private placements in connection with an equity security (","page_number":56,"box":{"x":69,"y":219,"width":729,"height":11}},{"id":"c1295c2e-307a-4c96-98d2-efc506f575fa","block_type":"box","text":"e.g.","page_number":56,"box":{"x":800,"y":220,"width":24,"height":10}},{"id":"0d33048f-da99-4f84-b878-38cec363b108","block_type":"box","text":", with","page_number":56,"box":{"x":827,"y":219,"width":36,"height":10}},{"id":"821ede83-f460-4c62-83cc-b7216e51ee7e","block_type":"box","text":"attached warrants). Such mezzanine investments may be issued with or without registration rights. Similar to other","page_number":56,"box":{"x":69,"y":234,"width":818,"height":11}},{"id":"41ef4f1b-3c1a-40a4-914b-80a481061332","block_type":"box","text":"high yield securities, maturities of mezzanine investments are typically seven to ten years, but the expected average","page_number":56,"box":{"x":69,"y":249,"width":827,"height":11}},{"id":"89de7c5f-6a23-4e25-8ef7-c36f3738704e","block_type":"box","text":"life is significantly shor ter at three to five years. Mezzanine investments are usually unsecured and subordinate to","page_number":56,"box":{"x":70,"y":264,"width":813,"height":11}},{"id":"2d3eddfa-023b-4f08-a1a7-16d2f61bbfd9","block_type":"box","text":"other obligations of the issuer.","page_number":56,"box":{"x":69,"y":279,"width":216,"height":11}},{"id":"c6a0b40f-1b4c-43d8-b357-5255135c00d0","block_type":"box","text":"Pay-in-kind Bonds.","page_number":56,"box":{"x":102,"y":302,"width":127,"height":11}},{"id":"5037853e-183a-42bf-a7ca-1f193310ae01","block_type":"box","text":"Cer tain Funds may invest in pay-in-kind, or PIK, bonds. PIK bonds are bonds which pay","page_number":56,"box":{"x":236,"y":302,"width":615,"height":11}},{"id":"8b89756d-79a7-4872-9627-f55e0e899c71","block_type":"box","text":"interest through the issuance of additional debt or equity securities. Similar to zero coupon obligations, pay-in-kind","page_number":56,"box":{"x":70,"y":317,"width":813,"height":11}},{"id":"09c51c64-38ef-411f-b99f-03096546e45e","block_type":"box","text":"bonds also carry additional risk as holders of these types of securities realize no cash until the cash payment date","page_number":56,"box":{"x":69,"y":332,"width":820,"height":11}},{"id":"385559db-e48f-4ac9-9454-c6ff3264f766","block_type":"box","text":"unless a por tion of such securities is sold and, if the issuer defaults, a Fund may obtain no return at all on its","page_number":56,"box":{"x":69,"y":347,"width":784,"height":11}},{"id":"b9f1a498-a87c-4968-939f-3315e3a2572e","block_type":"box","text":"investment. The market price of pay-in-kind bonds is affected by interest rate changes to a greater extent, and","page_number":56,"box":{"x":70,"y":362,"width":783,"height":11}},{"id":"afaa5b1a-c956-4342-9961-6bcb5c2f0e63","block_type":"box","text":"therefore tends to be more volatile, than that of securities which pay interest in cash. Additionally, current U.S.","page_number":56,"box":{"x":68,"y":377,"width":790,"height":11}},{"id":"1c708ac0-7449-4278-b8fb-ce1a38d6c6e1","block_type":"box","text":"federal tax law requires the holder of pay-in-kind bonds to accrue income with respect to these securities prior to the","page_number":56,"box":{"x":68,"y":392,"width":831,"height":12}},{"id":"3d1a527b-8b65-468b-97f3-b6cc8c3777e4","block_type":"box","text":"receipt of cash payments. To maintain its qualification as a regulated investment company and avoid liability for U.S.","page_number":56,"box":{"x":69,"y":407,"width":830,"height":12}},{"id":"974a8ca6-f658-4264-b60e-1bdcd7fadece","block_type":"box","text":"federal income and excise taxes, each Fund may be required to distribute income accrued with respect to these","page_number":56,"box":{"x":68,"y":423,"width":798,"height":11}},{"id":"89442f05-029a-43c5-8e88-386ceb09f1d9","block_type":"box","text":"securities and may have to dispose of por tfolio securities under disadvantageous circumstances in order to generate","page_number":56,"box":{"x":69,"y":438,"width":835,"height":11}},{"id":"5a3140cf-28b3-417d-be33-50f704e5b06d","block_type":"box","text":"cash to satisfy these distribution requirements.","page_number":56,"box":{"x":69,"y":453,"width":336,"height":11}},{"id":"e899e231-c2ae-4568-a060-14ac30c21ebd","block_type":"box","text":"Supranational Entities.","page_number":56,"box":{"x":102,"y":476,"width":160,"height":10}},{"id":"263e6a1b-59d9-4bbb-a3bb-b0f467a4110e","block_type":"box","text":"A Fund may invest in debt securities of supranational entities. Examples of such entities","page_number":56,"box":{"x":268,"y":475,"width":629,"height":12}},{"id":"b621c9c3-0c55-4f4b-9807-6b5430bdddb8","block_type":"box","text":"include the International Bank for Reconstruction and Development (the World Bank), the European Steel and Coal","page_number":56,"box":{"x":70,"y":491,"width":814,"height":11}},{"id":"0c23bed2-6928-4f1c-9298-2caeef848930","block_type":"box","text":"Community, the Asian Development Bank and the Inter-American Development Bank. The government members, or","page_number":56,"box":{"x":69,"y":506,"width":817,"height":11}},{"id":"0a1826d8-f1a9-42a8-bc78-6a1bc24bc70b","block_type":"box","text":"“stockholders,” usually make initial capital contributions to the supranational entity and in many cases are","page_number":56,"box":{"x":70,"y":521,"width":759,"height":11}},{"id":"e904806a-eab6-4e87-9f2e-21796f728878","block_type":"box","text":"committed to make additional capital contributions if the supranational entity is unable to repay its borrowings. There","page_number":56,"box":{"x":69,"y":536,"width":836,"height":11}},{"id":"463079d7-0c22-4c2a-8c2c-258690cb0d11","block_type":"box","text":"is no guarantee that one or more stockholders of a supranational entity will continue to make any necessary","page_number":56,"box":{"x":70,"y":551,"width":772,"height":11}},{"id":"c8f37132-43ae-4cf6-a875-1a9c0ac15a85","block_type":"box","text":"additional capital contributions. If such contributions are not made, the entity may be unable to pay interest or repay","page_number":56,"box":{"x":69,"y":566,"width":830,"height":11}},{"id":"da7cc679-4f04-4d9f-aa2e-99542d7c6892","block_type":"box","text":"principal on its debt securities, and a Fund may lose money on such investments.","page_number":56,"box":{"x":70,"y":582,"width":580,"height":10}},{"id":"b0d5ba9c-1484-4817-9bd1-f6f6be406107","block_type":"box","text":"Depositary Receipts (ADRs, EDRs and GDRs).","page_number":56,"box":{"x":102,"y":604,"width":334,"height":11}},{"id":"e8edbdab-9bfa-47e9-913d-591673bf7ee1","block_type":"box","text":"Cer tain Funds may invest in the securities of foreign issuers in","page_number":56,"box":{"x":442,"y":604,"width":446,"height":11}},{"id":"4b010ab2-a652-4b30-a195-2fcc159c38a1","block_type":"box","text":"the form of Depositary Receipts or other securities conver tible into securities of foreign issuers. Depositary Receipts","page_number":56,"box":{"x":68,"y":619,"width":835,"height":11}},{"id":"103e3f9f-4915-4cc4-a320-0d51915adfb2","block_type":"box","text":"may not necessarily be denominated in the same currency as the underlying securities into which they may be","page_number":56,"box":{"x":69,"y":634,"width":784,"height":12}},{"id":"6cbd34cc-1b58-475f-b9a1-890d9dcc0cdc","block_type":"box","text":"conver ted. The Fund may invest in both sponsored and unsponsored American Depositary Receipts (“ADRs”),","page_number":56,"box":{"x":69,"y":650,"width":781,"height":11}},{"id":"eabd683b-4f8a-41f3-a7f6-8efb3652976d","block_type":"box","text":"European Depositary Receipts (“EDRs”), Global Depositary Receipts (“GDRs”) and other similar global instruments.","page_number":56,"box":{"x":70,"y":665,"width":823,"height":11}},{"id":"7113e04a-ff01-4914-9f8a-a7a7f27f3c14","block_type":"box","text":"ADRs typically are issued by an American bank or trust company and evidence ownership of underlying securities","page_number":56,"box":{"x":68,"y":680,"width":804,"height":11}},{"id":"76352048-2745-45bc-bcf3-23caae7caa92","block_type":"box","text":"issued by a foreign corporation. EDRs, which are sometimes referred to as Continental Depositary Receipts, are","page_number":56,"box":{"x":70,"y":695,"width":799,"height":11}},{"id":"f68ed281-5ef5-43c7-a174-f40f6d0d9b5a","block_type":"box","text":"receipts issued in Europe, typically by foreign banks and trust companies, that evidence ownership of either foreign","page_number":56,"box":{"x":69,"y":710,"width":821,"height":11}},{"id":"afdaa2ec-85cd-4335-b039-6cca41683745","block_type":"box","text":"or domestic underlying securities. GDRs are depositary receipts structured like global debt issues to facilitate trading","page_number":56,"box":{"x":69,"y":725,"width":837,"height":11}},{"id":"77cdc0e9-8158-4053-a04f-8530bccbaa6e","block_type":"box","text":"on an international basis. In addition to investment risks associated with the underlying issuer, Depositary Receipts","page_number":56,"box":{"x":69,"y":740,"width":825,"height":11}},{"id":"be904ff9-b6e1-4740-bbfc-8a2436d3ad73","block_type":"box","text":"expose a Fund to additional risks associated with the non-uniform terms that apply to Depositary Receipt programs,","page_number":56,"box":{"x":69,"y":755,"width":825,"height":11}},{"id":"aff4320a-562c-4d58-9928-c513208fbd05","block_type":"box","text":"credit exposure to the depository bank and to the sponsors and other par ties with whom the depository bank","page_number":56,"box":{"x":69,"y":771,"width":780,"height":10}},{"id":"9a3f9bab-85bf-4b91-b223-5d7878c77e52","block_type":"box","text":"establishes the programs, currency risk and the risk of an illiquid market for Depositary Receipts. Unsponsored ADR,","page_number":56,"box":{"x":69,"y":785,"width":833,"height":12}},{"id":"73825d22-aa3e-4503-be1f-18bdfbd5939e","block_type":"box","text":"EDR and GDR programs are organized independently and without the cooperation of the issuer of the underlying","page_number":56,"box":{"x":70,"y":801,"width":796,"height":11}},{"id":"d7e298e7-7391-4da3-81ac-346a05647d3e","block_type":"box","text":"securities. Unsponsored programs generally expose investors to greater risks than sponsored programs and do not","page_number":56,"box":{"x":69,"y":816,"width":822,"height":11}},{"id":"6bcc5b52-136e-40b7-92ac-f91f4b386fd8","block_type":"box","text":"provide holders with many of the shareholder benefits that come from investing in a sponsored Depositary Receipt.","page_number":56,"box":{"x":70,"y":831,"width":820,"height":11}},{"id":"36887576-41dc-4a13-9b74-5b38faabbb59","block_type":"box","text":"Available information concerning the issuer may not be as current as for sponsored ADRs, EDRs and GDRs, and the","page_number":56,"box":{"x":68,"y":846,"width":827,"height":11}},{"id":"e0d342cb-f062-4554-9b85-4c91b67a8dbc","block_type":"box","text":"prices of unsponsored ADRs, EDRs and GDRs may be more volatile than if such instruments were sponsored by the","page_number":56,"box":{"x":70,"y":861,"width":825,"height":11}},{"id":"f6a72ed8-afa6-4417-9698-57aa7fd830d9","block_type":"box","text":"issuer. Depositary Receipts are generally subject to the same risks as the foreign securities that they evidence or","page_number":56,"box":{"x":70,"y":876,"width":810,"height":11}},{"id":"baaed7e2-2b6f-4f24-af11-a5421023411f","block_type":"box","text":"into which they may be conver ted. Investments in ADRs, EDRs and GDRs present additional investment","page_number":56,"box":{"x":70,"y":891,"width":737,"height":11}},{"id":"da069588-d38b-403a-b30f-2d0c2e21b3e5","block_type":"box","text":"considerations as described under “Foreign Investment Risks.”","page_number":56,"box":{"x":69,"y":907,"width":449,"height":11}},{"id":"66e20cdb-9de0-4883-8342-c17c995dd7e9","block_type":"box","text":"II-12","page_number":56,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"256fc135-cd15-40de-98f2-31e5ef4f1c7c","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":56,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"893e0c08-7e36-44fa-9fa8-b54e36b14ca3","block_type":"box","text":"Derivatives.","page_number":57,"box":{"x":102,"y":45,"width":84,"height":9}},{"id":"3f0b5438-cb60-4419-adca-ce890af9ecc2","block_type":"box","text":"General.","page_number":57,"box":{"x":102,"y":67,"width":58,"height":9}},{"id":"338547e2-8f20-4bc9-b3b9-0b69651333e5","block_type":"box","text":"Each Fund may use instruments referred to as derivatives, which are financial instruments that derive","page_number":57,"box":{"x":167,"y":67,"width":725,"height":11}},{"id":"d02b6266-e03e-42ca-8a69-5294875b74a0","block_type":"box","text":"their value from one or more securities, commodities (such as gold or oil), currencies, interest rates, credit events or","page_number":57,"box":{"x":68,"y":82,"width":836,"height":12}},{"id":"2480d075-3272-4ef0-a12e-a90c0369a1ab","block_type":"box","text":"indices (a measure of value or rates, such as the S&P 500 Index or the prime lending rate) or other reference asset.","page_number":57,"box":{"x":70,"y":98,"width":829,"height":11}},{"id":"74042b48-97a8-4c66-be46-12e697fbe822","block_type":"box","text":"Derivatives may allow a Fund to increase or decrease the level of risk to which the Fund is exposed more quickly and","page_number":57,"box":{"x":70,"y":113,"width":830,"height":11}},{"id":"91bc31c8-47a1-4291-a457-e8c670ebc21d","block_type":"box","text":"efficiently than with other transactions. Cer tain Funds may use derivatives to maintain a por tion of their long and","page_number":57,"box":{"x":69,"y":128,"width":804,"height":11}},{"id":"e5d5be08-224e-4f7a-b68a-47bfb2870be4","block_type":"box","text":"shor t positions. Unless otherwise permitted, no Fund may use derivatives to gain exposure to an asset or asset","page_number":57,"box":{"x":69,"y":143,"width":800,"height":11}},{"id":"20fda3d7-f8a8-49db-b562-cef19960ff7f","block_type":"box","text":"class it is prohibited by its investment restrictions from purchasing directly. As described below, derivatives can be","page_number":57,"box":{"x":69,"y":158,"width":816,"height":11}},{"id":"02c18766-f3fa-47eb-9123-2ae664f7b4cf","block_type":"box","text":"used for hedging or speculative purposes. Funds will engage in transaction-level payment netting,","page_number":57,"box":{"x":69,"y":173,"width":691,"height":11}},{"id":"7f245a20-3d37-4195-99eb-839ce4617cb5","block_type":"box","text":"i.e.","page_number":57,"box":{"x":768,"y":173,"width":20,"height":9}},{"id":"386dbfda-03ac-4316-b853-ef50f2330406","block_type":"box","text":", the payment","page_number":57,"box":{"x":791,"y":173,"width":96,"height":11}},{"id":"7b5ae0da-8286-462d-8c67-0154f278c8b8","block_type":"box","text":"obligations of derivatives contracts are netted against one another with the Fund receiving or paying, as the case may","page_number":57,"box":{"x":69,"y":188,"width":839,"height":12}},{"id":"fe6b426a-7c72-410b-ae98-e710798c634b","block_type":"box","text":"be, only the net amount of the two payment streams.","page_number":57,"box":{"x":69,"y":203,"width":378,"height":12}},{"id":"7567c46c-e939-44b6-958c-51026ef1f687","block_type":"box","text":"Hedging.","page_number":57,"box":{"x":102,"y":226,"width":60,"height":11}},{"id":"dc872872-d3e6-427f-8b4f-fa85ef20dd45","block_type":"box","text":"Each Fund may use derivatives for hedging purposes, in which a derivative is used to offset the risks","page_number":57,"box":{"x":169,"y":226,"width":717,"height":11}},{"id":"174a1f1e-7225-4e2d-a5e9-cc79e25862d9","block_type":"box","text":"associated with other Fund holdings. Losses on other investments may be substantially reduced by gains on a","page_number":57,"box":{"x":69,"y":241,"width":786,"height":11}},{"id":"af83b318-505e-40d4-9e39-35672bc792e7","block_type":"box","text":"derivative that reacts in an opposite manner to market movements. Although hedging may reduce losses, it may also","page_number":57,"box":{"x":69,"y":257,"width":834,"height":11}},{"id":"faba2c0c-55c3-49b5-b497-3c78c9cea64e","block_type":"box","text":"reduce or eliminate gains. In addition, hedging may cause losses if the market moves in an unanticipated manner, or","page_number":57,"box":{"x":69,"y":271,"width":834,"height":12}},{"id":"c31c7cb5-def9-447d-814e-ddfc61ed0769","block_type":"box","text":"if the cost of the derivative outweighs the benefit of the hedge. The effectiveness of hedging may be reduced by","page_number":57,"box":{"x":70,"y":286,"width":797,"height":12}},{"id":"2917a9fa-87f6-4886-9b9e-fec47902cad9","block_type":"box","text":"correlation risk,","page_number":57,"box":{"x":69,"y":302,"width":109,"height":10}},{"id":"f60b677a-c2db-46b3-bc7e-3bbbb7711fd8","block_type":"box","text":"i.e.","page_number":57,"box":{"x":186,"y":302,"width":20,"height":9}},{"id":"80ffb24f-d16f-4953-aced-9294ff6d3820","block_type":"box","text":", the risk that changes in the value of the derivative will not match those of the holdings being","page_number":57,"box":{"x":209,"y":302,"width":669,"height":11}},{"id":"cca614c7-3c17-4aeb-8afa-c0d8900ba3cc","block_type":"box","text":"hedged as expected by a Fund, which may result in additional losses to the Fund. The inability to close or offset","page_number":57,"box":{"x":69,"y":317,"width":797,"height":11}},{"id":"81995bbe-cc23-4ca1-a71d-ad4887017172","block_type":"box","text":"derivatives could also reduce the effectiveness of a Fund’s hedging. There is no assurance that a Fund’s hedging will","page_number":57,"box":{"x":69,"y":332,"width":835,"height":11}},{"id":"c2b66a9d-d27d-4f6d-9d43-9abef9267ec6","block_type":"box","text":"be effective. No Fund is required to use derivatives to hedge.","page_number":57,"box":{"x":69,"y":347,"width":434,"height":11}},{"id":"4c2b1325-db3c-4549-b256-dac0dccd3b2a","block_type":"box","text":"Speculation.","page_number":57,"box":{"x":102,"y":370,"width":86,"height":11}},{"id":"798eb802-16d3-4336-b42d-6292d88fd57b","block_type":"box","text":"Cer tain Funds may also use derivatives for speculative purposes to seek to enhance returns. The","page_number":57,"box":{"x":195,"y":370,"width":694,"height":11}},{"id":"f6a68bdc-2148-4a94-81ed-2cd665b068ea","block_type":"box","text":"use of a derivative is speculative if the Fund is primarily seeking to achieve gains, rather than offset the risk of other","page_number":57,"box":{"x":69,"y":385,"width":831,"height":11}},{"id":"725935a8-2539-4c08-b7a3-225adcbf35cf","block_type":"box","text":"positions. To the extent a Fund invests in a derivative for speculative purposes, the Fund will be fully exposed to the","page_number":57,"box":{"x":70,"y":400,"width":824,"height":11}},{"id":"61bd52aa-f654-4c69-bc06-eb1c6a21139e","block_type":"box","text":"risks of loss of that derivative, which may sometimes be greater than the derivative’s cost, and the potential for loss","page_number":57,"box":{"x":69,"y":415,"width":831,"height":11}},{"id":"f9b139be-4df8-4b19-b718-6eac54b9a103","block_type":"box","text":"in cer tain cases may be unlimited.","page_number":57,"box":{"x":70,"y":430,"width":243,"height":11}},{"id":"8d415b01-7685-4445-9818-3d160a8d3d37","block_type":"box","text":"Regulation of Derivatives.","page_number":57,"box":{"x":102,"y":453,"width":180,"height":11}},{"id":"77a933ce-afd7-4742-aa34-3e34a00d159b","block_type":"box","text":"Rule 18f-4 Under the Investment Company Act.","page_number":57,"box":{"x":102,"y":475,"width":333,"height":12}},{"id":"4061fea4-708b-4789-91ec-1e475e691b3b","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to","page_number":57,"box":{"x":442,"y":475,"width":458,"height":12}},{"id":"63b89572-2407-4a00-be8b-0d7c7f548d15","block_type":"box","text":"enter into Derivatives Transactions (as defined below) and cer tain other transactions notwithstanding the restrictions","page_number":57,"box":{"x":69,"y":491,"width":833,"height":11}},{"id":"ce293b76-8ffa-4f42-aa9d-faaed112683d","block_type":"box","text":"on the issuance of “senior securities” under Section 18 of the Investment Company Act. Section 18 of the","page_number":57,"box":{"x":69,"y":506,"width":759,"height":11}},{"id":"80deb326-5a45-4c65-8249-2a282077ba62","block_type":"box","text":"Investment Company Act, among other things, prohibits open-end funds, including the Funds, from issuing or selling","page_number":57,"box":{"x":70,"y":521,"width":825,"height":11}},{"id":"2559aa50-69e1-4db1-9ddf-8e9553b75e5e","block_type":"box","text":"any “senior security,” other than borrowing from a bank (subject to a requirement to maintain 300% “asset","page_number":57,"box":{"x":69,"y":536,"width":763,"height":11}},{"id":"fce15920-4124-4e66-b045-10a10fee5b42","block_type":"box","text":"coverage”).","page_number":57,"box":{"x":69,"y":551,"width":79,"height":11}},{"id":"7d33ac8c-23e5-4203-a1f7-ff6d5e275538","block_type":"box","text":"Under Rule 18f-4, “Derivatives Transactions” include the following: (1) any swap, security-based swap (including","page_number":57,"box":{"x":102,"y":574,"width":796,"height":11}},{"id":"f7eecc79-54b6-4a47-a39e-f4fb1afbafe6","block_type":"box","text":"a contract for differences), futures contract, forward contract, option (excluding purchased options), any combination","page_number":57,"box":{"x":69,"y":589,"width":832,"height":11}},{"id":"8e92a17a-218d-4d9c-88f9-10994874e1cd","block_type":"box","text":"of the foregoing, or any similar instrument, under which a Fund is or may be required to make any payment or delivery","page_number":57,"box":{"x":69,"y":604,"width":840,"height":11}},{"id":"8363e139-3d49-4247-b557-fd1e5659e2aa","block_type":"box","text":"of cash or other assets during the life of the instrument or at maturity or early termination, whether as margin or","page_number":57,"box":{"x":69,"y":619,"width":801,"height":11}},{"id":"03aea424-1277-45ff-99d0-e2c7b77e7efa","block_type":"box","text":"settlement payment or otherwise; (2) any shor t sale borrowing; (3) reverse repurchase agreements and similar","page_number":57,"box":{"x":69,"y":634,"width":791,"height":12}},{"id":"fb244250-604f-4adf-818d-a73406abd73d","block_type":"box","text":"financing transactions (","page_number":57,"box":{"x":68,"y":649,"width":166,"height":12}},{"id":"26b09358-4ee1-4c04-a1bd-872e4801956f","block_type":"box","text":"e.g.","page_number":57,"box":{"x":236,"y":651,"width":25,"height":10}},{"id":"45e51d16-b188-4055-8bf0-90a4d552fcd8","block_type":"box","text":", recourse and non-recourse tender option bonds, and borrowed bonds), if a Fund elects to","page_number":57,"box":{"x":263,"y":649,"width":646,"height":11}},{"id":"081fee8e-72a7-437c-acc5-7e98e768b1df","block_type":"box","text":"treat all of these transactions as Derivatives Transactions under Rule 18f-4; and (4) when-issued or forward-settling","page_number":57,"box":{"x":68,"y":664,"width":825,"height":12}},{"id":"8e19367b-3319-43ee-9e29-a022dc854555","block_type":"box","text":"securities (","page_number":57,"box":{"x":69,"y":680,"width":78,"height":11}},{"id":"c5299df6-7b77-4430-8efb-6905e009f2d2","block_type":"box","text":"e.g.","page_number":57,"box":{"x":148,"y":681,"width":25,"height":10}},{"id":"1bee6712-a482-4e35-94f2-62886011ff7c","block_type":"box","text":", firm and standby commitments, including to-be-announced (“TBA”) commitments, and dollar rolls)","page_number":57,"box":{"x":176,"y":680,"width":704,"height":11}},{"id":"51088814-7b90-4be8-91c9-ce25a0ba6988","block_type":"box","text":"and non-standard settlement cycle securities, unless such transactions meet the Delayed-Settlement Securities","page_number":57,"box":{"x":69,"y":695,"width":796,"height":11}},{"id":"661e3c72-f1af-4148-994c-2db46f50a73c","block_type":"box","text":"Provision (as defined below under “—When-Issued Securities, Delayed Delivery Securities and Forward","page_number":57,"box":{"x":69,"y":710,"width":732,"height":11}},{"id":"aaf16f3e-f7b7-4bde-9549-8306bc75d365","block_type":"box","text":"Commitments”).","page_number":57,"box":{"x":69,"y":725,"width":115,"height":11}},{"id":"375531fa-74be-40cc-bdc8-0288f5154d04","block_type":"box","text":"Unless a Fund is relying on the Limited Derivatives User Exception (as defined below), the Fund must comply with","page_number":57,"box":{"x":102,"y":748,"width":805,"height":11}},{"id":"f4fd0171-7a63-4cde-bbc9-a1c50b494fd3","block_type":"box","text":"Rule 18f-4 with respect to its Derivatives Transactions. Rule 18f-4, among other things, requires a Fund to adopt and","page_number":57,"box":{"x":70,"y":763,"width":832,"height":11}},{"id":"8c944cbe-5c22-419c-a5a7-0a3fa2ce50ed","block_type":"box","text":"implement a comprehensive written derivatives risk management program (“DRMP”) and comply with a relative or","page_number":57,"box":{"x":70,"y":778,"width":808,"height":11}},{"id":"6a445e15-4f17-486b-abeb-db606e05c6cf","block_type":"box","text":"absolute limit on Fund leverage risk calculated based on value-at-risk (“VaR”). The DRMP is administered by a","page_number":57,"box":{"x":69,"y":793,"width":780,"height":11}},{"id":"6957024d-8c23-4a10-ae1f-fb96f56aa1d6","block_type":"box","text":"“derivatives risk manager,” who is appointed by the Fund’s Board, including a majority of the independent Directors,","page_number":57,"box":{"x":70,"y":808,"width":824,"height":11}},{"id":"4aba9e75-6fb7-4ee3-b6be-fe794ac61d3b","block_type":"box","text":"and periodically reviews the DRMP and repor ts to the Fund’s Board.","page_number":57,"box":{"x":69,"y":823,"width":482,"height":11}},{"id":"0200b1fa-783d-466a-b820-f2748aeb4291","block_type":"box","text":"Rule 18f-4 provides an exception from the DRMP, VaR limit and cer tain other requirements if a Fund’s","page_number":57,"box":{"x":102,"y":846,"width":724,"height":11}},{"id":"14e00504-1d5f-4973-a3b0-729e5dcdeea0","block_type":"box","text":"“derivatives exposure” is limited to 10% of its net assets (as calculated in accordance with Rule 18f-4) and the Fund","page_number":57,"box":{"x":70,"y":861,"width":830,"height":11}},{"id":"d5693322-43da-4956-b487-6ce296e475eb","block_type":"box","text":"adopts and implements written policies and procedures reasonably designed to manage its derivatives risks (the","page_number":57,"box":{"x":69,"y":876,"width":803,"height":11}},{"id":"8992e977-8580-449d-88be-a49ec4d67174","block_type":"box","text":"“Limited Derivatives User Exception”).","page_number":57,"box":{"x":70,"y":891,"width":268,"height":11}},{"id":"bd4cad09-5776-49ec-b3cc-b95242bc0db5","block_type":"box","text":"II-13","page_number":57,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d6009636-2b7a-4a64-9b54-61148ef825b9","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":57,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"a12d86ea-1ff2-468b-84de-2027313a9c66","block_type":"box","text":"Dodd-Frank Regulations.","page_number":58,"box":{"x":102,"y":45,"width":171,"height":11}},{"id":"b7d5ba28-82fc-48f8-9182-312c397f5781","block_type":"box","text":"The Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”),","page_number":58,"box":{"x":279,"y":45,"width":575,"height":11}},{"id":"9ff96bef-2b0a-4831-9f68-89c0a066205a","block_type":"box","text":"enacted in July 2010, includes provisions that comprehensively regulate the over-the-counter (“OTC”) derivatives","page_number":58,"box":{"x":69,"y":60,"width":800,"height":11}},{"id":"fc217fdb-d75e-4ccc-a3ce-b23b3cb1d7ea","block_type":"box","text":"markets for the first time. While the Commodity Futures Trading Commission (“CFTC”) and other U.S. regulators have","page_number":58,"box":{"x":69,"y":75,"width":834,"height":11}},{"id":"c604db2c-c0c5-41c8-83ce-f8096c17c261","block_type":"box","text":"adopted many of the required Dodd-Frank regulations, cer tain regulations have only recently become effective and","page_number":58,"box":{"x":69,"y":90,"width":813,"height":11}},{"id":"7da97cb6-f14e-419f-be54-ef91787c7b12","block_type":"box","text":"other regulations remain to be adopted. The full impact of Dodd-Frank on the Funds remains uncer tain.","page_number":58,"box":{"x":69,"y":105,"width":733,"height":11}},{"id":"ab577700-8c5a-4052-a1ec-55a6740580b6","block_type":"box","text":"Many OTC derivatives dealers are required to register with the CFTC as “swap dealers” and/or with the SEC as","page_number":58,"box":{"x":102,"y":128,"width":789,"height":11}},{"id":"c79124d0-f495-4b0a-916e-19333a831eb3","block_type":"box","text":"“security-based swap dealers”. Registered swap dealers and security-based swap dealers are subject to various","page_number":58,"box":{"x":70,"y":143,"width":797,"height":11}},{"id":"52679b7e-f80c-481b-85a9-9034b0a794cf","block_type":"box","text":"regulatory requirements, including, but not limited to, margin, recordkeeping, repor ting, transparency, position limits,","page_number":58,"box":{"x":69,"y":158,"width":833,"height":11}},{"id":"4b5a379d-1251-486c-bebe-695dd991a01b","block_type":"box","text":"limitations on conflicts of interest, business conduct standards, minimum capital requirements and other regulatory","page_number":58,"box":{"x":70,"y":173,"width":826,"height":11}},{"id":"edfb64f4-2fd7-46f7-bd33-90a4003e71be","block_type":"box","text":"requirements, which indirectly impact the Funds that enter into transactions with them.","page_number":58,"box":{"x":69,"y":188,"width":618,"height":11}},{"id":"6f8af1af-b672-4503-83c1-9f5d03c634a5","block_type":"box","text":"The CFTC requires that cer tain interest rate swaps and cer tain credit default swaps must be executed in","page_number":58,"box":{"x":101,"y":211,"width":745,"height":11}},{"id":"affcd6ab-43a8-45d7-adee-7fc72007dcfb","block_type":"box","text":"regulated markets and be submitted for clearing to regulated clearinghouses. The SEC is also expected to impose","page_number":58,"box":{"x":69,"y":226,"width":813,"height":11}},{"id":"60a317d5-6f44-49b7-89a5-2e556b74dbf8","block_type":"box","text":"similar requirements on cer tain security-based derivatives in the future. OTC derivatives trades submitted for clearing","page_number":58,"box":{"x":69,"y":241,"width":835,"height":11}},{"id":"0ba5937d-4547-4a04-8deb-b70d67411ce6","block_type":"box","text":"are subject to minimum initial and variation margin requirements set by the relevant clearinghouse, as well as margin","page_number":58,"box":{"x":69,"y":257,"width":837,"height":11}},{"id":"a7b57298-9d01-47d0-bab8-47c72f815c51","block_type":"box","text":"requirements mandated by the CFTC, SEC and/or federal prudential regulators. In addition, futures commission","page_number":58,"box":{"x":69,"y":271,"width":794,"height":12}},{"id":"7dd89ad9-299d-4566-880e-472bb7e0df93","block_type":"box","text":"merchants (“FCMs”), who act as clearing members on behalf of customers for cleared OTC derivatives and futures","page_number":58,"box":{"x":69,"y":286,"width":815,"height":12}},{"id":"f294ca45-7ec1-4ec4-9139-ba6b5ca1e278","block_type":"box","text":"contracts, also have discretion to increase a Fund’s margin requirements for these transactions beyond any","page_number":58,"box":{"x":69,"y":302,"width":770,"height":11}},{"id":"6a004392-08c9-4338-90d9-97a52bacddad","block_type":"box","text":"regulatory and clearinghouse minimums subject to any restrictions on such discretion in the documentation between","page_number":58,"box":{"x":69,"y":317,"width":831,"height":11}},{"id":"5e21b124-b707-4066-9d8c-d23e0b6aa2bc","block_type":"box","text":"the FCM and the customer. These regulatory requirements may make it more difficult and costly for the Funds to","page_number":58,"box":{"x":68,"y":332,"width":804,"height":11}},{"id":"891f7cc6-50d5-4e8d-baf5-f8f93aad30a4","block_type":"box","text":"enter into highly tailored or customized transactions, potentially rendering cer tain investment strategies impossible or","page_number":58,"box":{"x":69,"y":347,"width":839,"height":11}},{"id":"d3c707e4-d6f4-4339-90b2-b94bd6c43aa2","block_type":"box","text":"not economically feasible. If a Fund decides to execute and clear cleared OTC derivatives and/or futures contracts","page_number":58,"box":{"x":69,"y":362,"width":814,"height":11}},{"id":"998b0451-f557-485f-b0e9-3a9d37cc53a6","block_type":"box","text":"through execution facilities, exchanges or clearinghouses, either indirectly through an executing broker, clearing","page_number":58,"box":{"x":68,"y":377,"width":796,"height":12}},{"id":"591039cc-5e7b-4026-8d78-21896890d328","block_type":"box","text":"member FCM or as a direct member, a Fund would be required to comply with the rules of the execution facility,","page_number":58,"box":{"x":69,"y":392,"width":793,"height":12}},{"id":"351af878-06e2-4aac-9bd8-90804684ae80","block_type":"box","text":"exchange or clearinghouse and other applicable law.","page_number":58,"box":{"x":69,"y":408,"width":370,"height":11}},{"id":"2601e465-c2e4-4c9f-8f3d-9cfb72c3e9e6","block_type":"box","text":"With respect to cleared OTC derivatives and futures contracts and options on futures, a Fund will not face a","page_number":58,"box":{"x":101,"y":430,"width":766,"height":11}},{"id":"ad1a5f44-82e2-4901-8734-47f92e7aa287","block_type":"box","text":"clearinghouse directly but rather will do so through a FCM that is registered with the CFTC and/or SEC and that acts","page_number":58,"box":{"x":69,"y":445,"width":826,"height":12}},{"id":"00c995b9-9664-45ec-b332-3f773c0430f2","block_type":"box","text":"as a clearing member. A Fund may face the indirect risk of the failure of another clearing member customer to meet","page_number":58,"box":{"x":69,"y":460,"width":825,"height":12}},{"id":"10ac81d5-d31d-4b14-a9b8-69f4f3809506","block_type":"box","text":"its obligations to its clearing member. Such scenario could arise due to a default by the clearing member on its","page_number":58,"box":{"x":70,"y":475,"width":791,"height":12}},{"id":"a25cbfe9-5e2b-430b-b077-aae9e3a61087","block_type":"box","text":"obligations to the clearinghouse simultaneously with a customer’s failure to meet its obligations to the clearing","page_number":58,"box":{"x":69,"y":491,"width":793,"height":11}},{"id":"e8c9e990-390a-43f2-8109-e44af13395da","block_type":"box","text":"member.","page_number":58,"box":{"x":69,"y":506,"width":60,"height":9}},{"id":"155ab5f0-5a69-4ba5-8e93-a2582ef7e0ea","block_type":"box","text":"Clearing member FCMs are required to post initial margin to the clearinghouses through which they clear their","page_number":58,"box":{"x":102,"y":529,"width":782,"height":11}},{"id":"9ac02ebb-1bab-4881-860f-8eaf1d9d51cd","block_type":"box","text":"customers’ cleared OTC derivatives and futures contracts, instead of using such initial margin in their businesses, as","page_number":58,"box":{"x":69,"y":543,"width":837,"height":12}},{"id":"c24a6181-544b-4832-b9fc-ca6235061daa","block_type":"box","text":"was widely permitted for OTC derivatives before Dodd-Frank. While an FCM may require its customer to post initial","page_number":58,"box":{"x":68,"y":559,"width":811,"height":11}},{"id":"b4775d63-bb9a-4e4b-970f-461f0bfa728e","block_type":"box","text":"margin in excess of clearinghouse requirements, and cer tain clearinghouses may share a por tion of their earnings on","page_number":58,"box":{"x":69,"y":574,"width":838,"height":11}},{"id":"11018971-b068-4b63-b544-94d4e3f16f67","block_type":"box","text":"initial margin with their clearing members, some por tion of the initial margin that is passed through to the","page_number":58,"box":{"x":70,"y":589,"width":754,"height":11}},{"id":"29241398-7bac-46f1-93c0-5b425e93c4f0","block_type":"box","text":"clearinghouse does not generate earnings for the FCM. The inability of FCMs to earn the same levels of returns on","page_number":58,"box":{"x":69,"y":604,"width":815,"height":11}},{"id":"607beb27-68a9-40d4-a653-35344fdff84e","block_type":"box","text":"initial margin for cleared OTC derivatives as they could earn with respect to non-cleared OTC derivatives may cause","page_number":58,"box":{"x":70,"y":619,"width":817,"height":11}},{"id":"53390b98-6777-46ef-8b02-f4e941a317e2","block_type":"box","text":"FCMs to charge higher fees, or provide less favorable pricing on cleared OTC derivatives than swap dealers will","page_number":58,"box":{"x":70,"y":634,"width":788,"height":12}},{"id":"667338a6-3e1c-410b-9394-6fac8d933392","block_type":"box","text":"provide for non-cleared OTC derivatives. Fur thermore, customers, including the Funds, are subject to additional fees","page_number":58,"box":{"x":70,"y":649,"width":825,"height":12}},{"id":"312582c3-507d-4bdd-8aea-727521008ec6","block_type":"box","text":"payable to FCMs with respect to cleared OTC derivatives, which may raise the cost to Funds of clearing as compared","page_number":58,"box":{"x":70,"y":664,"width":829,"height":12}},{"id":"a1f3f9de-298f-4549-8434-51e5e366fff1","block_type":"box","text":"to trading non-cleared OTC derivatives bilaterally.","page_number":58,"box":{"x":68,"y":680,"width":346,"height":11}},{"id":"a60728ab-5a63-4863-afd2-7d06193f4c3f","block_type":"box","text":"With respect to uncleared swaps, registered swap dealers and security-based swap dealers are required to","page_number":58,"box":{"x":101,"y":703,"width":762,"height":11}},{"id":"ac82667a-af7b-41e0-818f-dce1dbcf7e2b","block_type":"box","text":"exchange variation margin with a Fund and may be required by applicable regulations to collect (and in some cases","page_number":58,"box":{"x":69,"y":718,"width":820,"height":11}},{"id":"2cf1bb99-20b3-431a-9ddc-b77f92c53673","block_type":"box","text":"exchange) initial margin with a Fund. Both initial and variation margin may be comprised of cash and/or securities,","page_number":58,"box":{"x":69,"y":732,"width":816,"height":12}},{"id":"a3704b8c-cc1c-4bc9-93b0-a730b3e3e319","block_type":"box","text":"subject to applicable regulatory haircuts and other restrictions. Shares of investment companies (other than cer tain","page_number":58,"box":{"x":69,"y":748,"width":825,"height":11}},{"id":"206370cf-be36-4443-8772-5838a06dd3c0","block_type":"box","text":"money market funds) may not be posted as collateral under applicable regulations.","page_number":58,"box":{"x":69,"y":763,"width":590,"height":11}},{"id":"090b44cc-78a0-4372-803e-268e06c849fe","block_type":"box","text":"The CFTC, cer tain foreign regulators, and many futures exchanges have established (and continue to evaluate","page_number":58,"box":{"x":101,"y":785,"width":783,"height":12}},{"id":"f7e78fcd-7261-4662-89b6-1a6f27a18053","block_type":"box","text":"and monitor) speculative position limits (“position limits”) on the maximum speculative position which any person, or","page_number":58,"box":{"x":69,"y":801,"width":833,"height":11}},{"id":"4888ef89-2b4e-46f8-ac62-b4d56705a223","block_type":"box","text":"group of persons acting in concer t, may hold or control in par ticular contracts. In addition, U.S. federal position limits","page_number":58,"box":{"x":68,"y":816,"width":837,"height":11}},{"id":"33bf7e07-e87a-4843-aab1-cb8ff9902a5e","block_type":"box","text":"apply to swaps that are economically equivalent to futures contracts on cer tain agricultural, metals and energy","page_number":58,"box":{"x":69,"y":831,"width":789,"height":11}},{"id":"e842487d-5b7d-408d-b8c7-6f217f296939","block_type":"box","text":"commodities. All positions owned or controlled by the same person or entity, even if in different accounts, must be","page_number":58,"box":{"x":69,"y":846,"width":818,"height":11}},{"id":"9f5b60c6-2d68-4f11-b2d3-fb0fc95c609c","block_type":"box","text":"aggregated for purposes of complying with the speculative limits. Thus, even if a Fund does not intend to exceed","page_number":58,"box":{"x":69,"y":861,"width":801,"height":11}},{"id":"d83143d0-4ada-46ee-a0f9-af1316b2f0e1","block_type":"box","text":"applicable position limits, it is possible that different clients managed by the Manager and its affiliates may be","page_number":58,"box":{"x":69,"y":876,"width":791,"height":11}},{"id":"d3de5c76-74c0-42c3-a1f1-bc35a6a0f334","block_type":"box","text":"aggregated for this purpose. Therefore, the trading decisions of the Manager may have to be modified and positions","page_number":58,"box":{"x":69,"y":891,"width":827,"height":12}},{"id":"95333a28-70a5-4180-92a1-44e7195f33a6","block_type":"box","text":"held by a Fund liquidated in order to avoid exceeding such limits. The modification of investment decisions or the","page_number":58,"box":{"x":69,"y":906,"width":805,"height":12}},{"id":"ebddaf3b-1f5a-4d40-b0bb-ec605c1ad7ce","block_type":"box","text":"II-14","page_number":58,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"b72ea33e-13a6-471a-8448-ed343d3f8a48","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":58,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"258e09ba-fb67-49bf-8bbb-bfb83187099a","block_type":"box","text":"elimination of open positions, if it occurs, may adversely affect the profitability of a Fund. A violation of position limits","page_number":59,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"647f1edd-e297-4384-8de7-cebc196c8305","block_type":"box","text":"could also lead to regulatory action materially adverse to a Fund’s investment strategy. A Fund may also be affected","page_number":59,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"27039b8f-29fe-4da3-9cf8-61ff8e8391cd","block_type":"box","text":"by other regimes, including those of the European Union and United Kingdom, and trading venues that impose","page_number":59,"box":{"x":69,"y":75,"width":785,"height":11}},{"id":"ca01f7b5-08e3-470b-aa65-81e7ba99e9c4","block_type":"box","text":"position limits on commodity derivative contracts.","page_number":59,"box":{"x":70,"y":90,"width":350,"height":11}},{"id":"b15bef18-cf69-4a1c-920d-94fb50aea656","block_type":"box","text":"Additional Regulation of Derivatives.","page_number":59,"box":{"x":101,"y":113,"width":256,"height":11}},{"id":"16d54afa-1527-4a84-87b1-c821ca5d867b","block_type":"box","text":"Regulatory bodies outside the U.S. have also passed, proposed, or may","page_number":59,"box":{"x":364,"y":113,"width":513,"height":11}},{"id":"8773b2dc-1bd2-4996-8582-e9208f9b99aa","block_type":"box","text":"propose in the future, legislation similar to Dodd-Frank or other legislation that could increase the costs of","page_number":59,"box":{"x":70,"y":128,"width":757,"height":11}},{"id":"0c3da099-56d0-4bc5-936b-d262358d2727","block_type":"box","text":"par ticipating in, or otherwise adversely impact the liquidity of, par ticipating in the commodities markets. For example,","page_number":59,"box":{"x":70,"y":143,"width":836,"height":11}},{"id":"d504bf0e-1efe-4af4-b550-6dbb5f48dc9b","block_type":"box","text":"the European Market Infrastructure Regulation (Regulation (EU) No 648/2012) (“EMIR”) introduced cer tain","page_number":59,"box":{"x":68,"y":158,"width":762,"height":11}},{"id":"ab38584a-015c-4825-ab3a-1d49642b8351","block_type":"box","text":"requirements in respect of OTC derivatives including: (i) the mandatory clearing of OTC derivative contracts declared","page_number":59,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"5ac3e882-5db8-4d8f-85ef-917c1d196ac0","block_type":"box","text":"subject to the clearing obligation; (ii) risk mitigation techniques in respect of uncleared OTC derivative contracts,","page_number":59,"box":{"x":69,"y":188,"width":798,"height":12}},{"id":"76affadc-1611-4d2e-82aa-922a0a078796","block_type":"box","text":"including the mandatory margining of uncleared OTC derivative contracts; and (iii) repor ting and recordkeeping","page_number":59,"box":{"x":70,"y":203,"width":785,"height":12}},{"id":"d7dba931-8287-49f6-818e-495d18af34c3","block_type":"box","text":"requirements in respect of all derivatives contracts. By way of fur ther example, the European Union Markets in","page_number":59,"box":{"x":69,"y":218,"width":787,"height":12}},{"id":"7b12e04d-cd33-4783-90bd-45c729fccdef","block_type":"box","text":"Financial Instruments Directive (Directive 2014/65/EU) and Markets in Financial Instruments Regulation (Regulation","page_number":59,"box":{"x":70,"y":234,"width":830,"height":11}},{"id":"2f2fefc7-b2cd-48a0-9cba-e554470dfb4f","block_type":"box","text":"(EU) No 600/2014) (together “MiFID II”), which have applied since January 3, 2018, govern the provision of","page_number":59,"box":{"x":69,"y":249,"width":771,"height":11}},{"id":"03e28a71-de0e-4684-8d4e-a6736daafcbe","block_type":"box","text":"investment services and activities in relation to, as well as the organized trading of, financial instruments such as","page_number":59,"box":{"x":70,"y":264,"width":812,"height":11}},{"id":"b845dccb-859c-4b88-96b7-fe0b8797579b","block_type":"box","text":"shares, bonds, units in collective investment schemes and derivatives. In par ticular, MiFID II requires European Union","page_number":59,"box":{"x":69,"y":279,"width":839,"height":11}},{"id":"0ae670de-b5e6-45d1-bc40-30838e6c622b","block_type":"box","text":"Member States to apply position limits to the size of a net position a person can hold at any time in commodity","page_number":59,"box":{"x":70,"y":294,"width":793,"height":11}},{"id":"4d3f30fc-7632-475c-915b-353ef4c42e4c","block_type":"box","text":"derivatives traded on European Union trading venues and in “economically equivalent” OTC contracts. If the","page_number":59,"box":{"x":69,"y":309,"width":765,"height":11}},{"id":"b6cfbb8b-419a-4c76-941d-6b67f924e103","block_type":"box","text":"requirements of EMIR and MiFID II apply, the cost of derivatives transactions is expected to increase.","page_number":59,"box":{"x":69,"y":324,"width":720,"height":11}},{"id":"f10a32bf-5136-41ab-9fa7-896239191de8","block_type":"box","text":"In addition, regulations adopted by global prudential regulators that are now in effect require cer tain prudentially","page_number":59,"box":{"x":102,"y":347,"width":802,"height":11}},{"id":"d5fb1f11-6330-4e22-9213-4104d9c88145","block_type":"box","text":"regulated entities and cer tain of their affiliates and subsidiaries (including swap dealers) to include in their","page_number":59,"box":{"x":69,"y":362,"width":762,"height":11}},{"id":"9f2c4aea-1c32-43df-99a6-adae5afd0362","block_type":"box","text":"derivatives contracts and cer tain other financial contracts, terms that delay or restrict the rights of counterpar ties","page_number":59,"box":{"x":69,"y":377,"width":810,"height":12}},{"id":"11453fd5-0407-4691-b9b4-9199fe166303","block_type":"box","text":"(such as the Funds) to terminate such contracts, foreclose upon collateral, exercise other default rights or restrict","page_number":59,"box":{"x":69,"y":392,"width":812,"height":12}},{"id":"b8df7bc3-f826-4b45-b2c2-fddd29c8e715","block_type":"box","text":"transfers of credit suppor t in the event that the prudentially regulated entity and/or its affiliates are subject to","page_number":59,"box":{"x":68,"y":407,"width":787,"height":12}},{"id":"180ed069-8f0a-4a05-bcd9-b96e034bee09","block_type":"box","text":"cer tain types of resolution or insolvency proceedings. Similar regulations and laws have been adopted in non-U.S.","page_number":59,"box":{"x":69,"y":423,"width":810,"height":11}},{"id":"dcee6b8d-d7ab-4e09-851a-245a06151948","block_type":"box","text":"jurisdictions that may apply to a Fund’s counterpar ties located in those jurisdictions. In par ticular, in the United","page_number":59,"box":{"x":67,"y":438,"width":795,"height":11}},{"id":"7dc50950-2479-40f1-a3df-5b44f126b42c","block_type":"box","text":"Kingdom and the European Union, governmental authorities could reduce, eliminate or conver t to equity the liabilities","page_number":59,"box":{"x":70,"y":453,"width":835,"height":11}},{"id":"3be09419-16cb-49ad-92ae-ae6930eb853e","block_type":"box","text":"to a Fund of a counterpar ty experiencing financial difficulties (sometimes referred to as a “bail in”). It is possible that","page_number":59,"box":{"x":68,"y":468,"width":839,"height":11}},{"id":"9080a0f9-ee44-4733-87ff-1f09c06e55bb","block_type":"box","text":"these requirements, as well as potential additional related government regulation, could adversely affect a Fund’s","page_number":59,"box":{"x":68,"y":483,"width":814,"height":11}},{"id":"b18daa8a-8da8-412a-8c2c-5112f24c7940","block_type":"box","text":"ability to terminate existing derivatives contracts, exercise default rights or satisfy obligations owed to it with","page_number":59,"box":{"x":69,"y":498,"width":773,"height":11}},{"id":"1b60248d-f9a7-4b3d-982e-e61ab4cfc0e6","block_type":"box","text":"collateral received under such contracts.","page_number":59,"box":{"x":69,"y":514,"width":288,"height":8}},{"id":"20b619be-7262-49e9-9ab5-bea69d1eeac2","block_type":"box","text":"Risk Factors in Derivatives.","page_number":59,"box":{"x":102,"y":536,"width":191,"height":9}},{"id":"1463b63a-b8e4-4152-9389-46f7e3bd291b","block_type":"box","text":"There are significant risks that apply generally to derivatives transactions, including:","page_number":59,"box":{"x":101,"y":559,"width":597,"height":11}},{"id":"cf20c289-24b0-4a60-aef2-f9c4e2770c42","block_type":"box","text":"Correlation Risk","page_number":59,"box":{"x":102,"y":581,"width":114,"height":9}},{"id":"57c0fb80-1394-4dae-90d1-86ef5f89ee69","block_type":"box","text":"— the risk that changes in the value of a derivative will not match the changes in the value of","page_number":59,"box":{"x":220,"y":581,"width":668,"height":12}},{"id":"f76ed21c-e305-45a1-9ba9-1912e0968d76","block_type":"box","text":"the por tfolio holdings that are being hedged or of the par ticular market or security to which the Fund seeks exposure.","page_number":59,"box":{"x":68,"y":596,"width":837,"height":12}},{"id":"ca551921-6889-4bee-9011-84b5e688b540","block_type":"box","text":"There are a number of factors which may prevent a derivative instrument from achieving the desired correlation (or","page_number":59,"box":{"x":68,"y":612,"width":818,"height":11}},{"id":"3e841ac8-4191-4e7d-88ce-b6be44b086db","block_type":"box","text":"inverse correlation) with an underlying asset, rate or index, such as the impact of fees, expenses and transaction","page_number":59,"box":{"x":70,"y":627,"width":806,"height":11}},{"id":"ae102a0f-4ee1-48f0-9f44-698a37162fc7","block_type":"box","text":"costs, the timing of pricing, and disruptions or illiquidity in the markets for such derivative instrument.","page_number":59,"box":{"x":69,"y":642,"width":725,"height":11}},{"id":"33f8efaf-d729-477b-b43c-bbc21b30f4e6","block_type":"box","text":"Counterpar ty Risk","page_number":59,"box":{"x":102,"y":665,"width":128,"height":11}},{"id":"0c3fa4d8-60b8-43f2-888a-49408372fe74","block_type":"box","text":"— the risk that a derivatives transaction counterpar ty will be unable or unwilling to make","page_number":59,"box":{"x":233,"y":665,"width":632,"height":11}},{"id":"ad88883c-eda7-44f4-8fd7-c52b68eaad84","block_type":"box","text":"payments or otherwise honor its obligations to a Fund and the related risks of having concentrated exposure to such","page_number":59,"box":{"x":70,"y":680,"width":830,"height":11}},{"id":"15d396eb-4973-45c9-9f28-d7afecef0905","block_type":"box","text":"a counterpar ty. In par ticular, derivatives traded in OTC markets often are not guaranteed by an exchange or clearing","page_number":59,"box":{"x":69,"y":695,"width":824,"height":11}},{"id":"1725115c-82b6-4817-87d9-11cf160e0260","block_type":"box","text":"corporation and often do not require payment of margin, and to the extent that the Fund has unrealized gains in such","page_number":59,"box":{"x":69,"y":710,"width":834,"height":11}},{"id":"9c8912fa-29a9-4b22-9f1f-bec9247417f7","block_type":"box","text":"instruments or has deposited collateral with its counterpar ties the Fund is at risk that its counterpar ties will become","page_number":59,"box":{"x":70,"y":725,"width":831,"height":11}},{"id":"218eac2e-e954-4440-9512-1802ecebe207","block_type":"box","text":"bankrupt or otherwise fail to honor their obligations. A Fund will typically attempt to minimize counterpar ty risk by","page_number":59,"box":{"x":69,"y":740,"width":806,"height":11}},{"id":"fdb4ade7-afcb-454a-8e24-d022d127d699","block_type":"box","text":"engaging in OTC derivatives transactions only with creditwor thy entities that have substantial capital or that have","page_number":59,"box":{"x":69,"y":755,"width":803,"height":11}},{"id":"6ea9d05b-8e3b-4c90-a561-821913328485","block_type":"box","text":"provided the Fund with a third-par ty guaranty or other credit suppor t. When a Fund enters into a derivatives","page_number":59,"box":{"x":70,"y":771,"width":760,"height":11}},{"id":"c3e21e46-cb8a-4606-bd09-62ad783a4ff6","block_type":"box","text":"transaction that is centrally cleared (whether mandatorily or voluntarily), the Fund is subject to the credit risk of the","page_number":59,"box":{"x":68,"y":785,"width":819,"height":12}},{"id":"f40f2f86-87e5-4fa7-ba65-fed447e0e064","block_type":"box","text":"clearing house and the clearing member through which it holds its cleared position. Credit risk of market par ticipants","page_number":59,"box":{"x":69,"y":801,"width":834,"height":11}},{"id":"0964f8cd-5187-4c03-b51b-7a370fb42b29","block_type":"box","text":"with respect to derivatives that are centrally cleared is concentrated in a few clearing houses and increasingly fewer","page_number":59,"box":{"x":68,"y":816,"width":826,"height":11}},{"id":"e9a420f8-c151-4db1-8a93-1ab7e8d429bb","block_type":"box","text":"clearing members. It is not clear how an insolvency proceeding of a clearing house would be conducted and what","page_number":59,"box":{"x":69,"y":831,"width":805,"height":11}},{"id":"927fb20b-a38b-4e1f-966a-829e407d03d4","block_type":"box","text":"impact an insolvency of a clearing house would have on the financial system. Also, a Fund will not be fully protected","page_number":59,"box":{"x":70,"y":846,"width":824,"height":11}},{"id":"1210e5d7-47b9-46f7-8b1c-fbfc424c44dc","block_type":"box","text":"in the event of the bankruptcy of a Fund’s clearing member because the Fund would be limited to recovering only a","page_number":59,"box":{"x":70,"y":861,"width":816,"height":11}},{"id":"2fe6e05f-1127-4f94-a603-ec4cfd1a630e","block_type":"box","text":"pro rata share of the funds held by the clearing member on behalf of customers by account class for cleared","page_number":59,"box":{"x":70,"y":876,"width":771,"height":11}},{"id":"76614905-bb3f-4c1e-8d24-f611d7d5bf92","block_type":"box","text":"derivatives. Although a clearing member is required to segregate assets from customers with respect to cleared","page_number":59,"box":{"x":69,"y":891,"width":797,"height":12}},{"id":"b3c175fc-2b6c-4456-a871-cff322649e70","block_type":"box","text":"derivatives positions from the clearing member’s proprietary assets, if a clearing member does not comply with the","page_number":59,"box":{"x":69,"y":906,"width":822,"height":12}},{"id":"4685b717-bebb-4ee6-82ac-1c7e95a1e81a","block_type":"box","text":"II-15","page_number":59,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"0de76840-1dde-4e0a-abdc-44e1d209f354","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":59,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"a8312cd5-930f-4154-94db-30b10131418f","block_type":"box","text":"applicable regulations, or in the event of fraud or misappropriation of customer assets by a clearing member, a Fund","page_number":60,"box":{"x":69,"y":45,"width":829,"height":11}},{"id":"db5b0897-c9fd-4759-8512-93cf6e8ee03b","block_type":"box","text":"could have only an unsecured creditor claim in an insolvency of the clearing member with respect to the assets held","page_number":60,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"72cf902b-26ee-424b-a3fc-ae5bb4740359","block_type":"box","text":"by the clearing member.","page_number":60,"box":{"x":69,"y":75,"width":169,"height":11}},{"id":"b041b087-dc27-4f4c-a3b9-c66516422f82","block_type":"box","text":"Credit Risk","page_number":60,"box":{"x":102,"y":98,"width":78,"height":9}},{"id":"8a3f1ec4-30dc-4d51-bb0e-27b5f80c1802","block_type":"box","text":"— the risk that the reference entity in a credit default swap or similar derivative will not be able to","page_number":60,"box":{"x":184,"y":98,"width":698,"height":11}},{"id":"1ac7afa8-6b03-4667-9469-20a71a5b1b1a","block_type":"box","text":"honor its financial obligations.","page_number":60,"box":{"x":69,"y":113,"width":213,"height":11}},{"id":"8452b865-51d9-423e-8736-e29c10157351","block_type":"box","text":"Currency Risk","page_number":60,"box":{"x":102,"y":135,"width":98,"height":11}},{"id":"bf8dd7a9-ce91-4563-9c03-7444bd07de98","block_type":"box","text":"— the risk that changes in the exchange rate between two currencies will adversely affect the","page_number":60,"box":{"x":204,"y":135,"width":669,"height":12}},{"id":"51933587-2349-4e60-a0f3-db2a2e8b4e70","block_type":"box","text":"value (in U.S. dollar terms) of a derivative.","page_number":60,"box":{"x":68,"y":150,"width":300,"height":11}},{"id":"c98bb863-b1ae-4ece-8bb1-d676bfbcd187","block_type":"box","text":"Illiquidity Risk","page_number":60,"box":{"x":102,"y":173,"width":98,"height":11}},{"id":"7003d8aa-507f-4398-a29b-e45cd6adbd00","block_type":"box","text":"— the risk that cer tain securities or instruments may be difficult or impossible to sell at the time","page_number":60,"box":{"x":204,"y":173,"width":693,"height":11}},{"id":"5cf2d948-3d15-4344-9091-a8c2db3458cc","block_type":"box","text":"or at the price desired by a Fund in connection with payments of margin, collateral, or settlement payments. There","page_number":60,"box":{"x":69,"y":188,"width":814,"height":12}},{"id":"59c64cfd-90a7-4fb8-a98e-477b3fb8a18b","block_type":"box","text":"can be no assurance that a Fund will be able to unwind or offset a derivative at its desired price, in a secondary","page_number":60,"box":{"x":69,"y":203,"width":799,"height":12}},{"id":"e26b2cc3-f6d9-44cb-8e3b-f5ba906cdd70","block_type":"box","text":"market or otherwise. It may, therefore, not be possible for the Fund to unwind its position in a derivative without","page_number":60,"box":{"x":69,"y":218,"width":799,"height":12}},{"id":"527e4fe2-c484-462d-afac-e198afa2ee1e","block_type":"box","text":"incurring substantial losses (if at all). Cer tain OTC derivatives, including swaps and OTC options, involve substantial","page_number":60,"box":{"x":70,"y":234,"width":824,"height":11}},{"id":"246978d3-6743-4e4c-bebd-b7e344403f70","block_type":"box","text":"illiquidity risk. Illiquidity may also make it more difficult for a Fund to ascer tain a market value for such derivatives. A","page_number":60,"box":{"x":70,"y":249,"width":830,"height":11}},{"id":"f098c2a2-c651-48e3-9849-84f60c0ecacd","block_type":"box","text":"Fund will, therefore, acquire illiquid OTC derivatives (i) if the agreement pursuant to which the instrument is","page_number":60,"box":{"x":70,"y":264,"width":762,"height":11}},{"id":"23e26910-ce80-4e10-a73b-f7db7aacf55e","block_type":"box","text":"purchased contains a formula price at which the instrument may be terminated or sold, or (ii) for which the Manager","page_number":60,"box":{"x":70,"y":279,"width":827,"height":11}},{"id":"68909271-8fff-403b-b796-b223014e5964","block_type":"box","text":"anticipates the Fund can receive on each business day at least two independent bids or offers, unless a quotation","page_number":60,"box":{"x":69,"y":294,"width":816,"height":11}},{"id":"b770efad-01ef-42d8-9483-03a8470d12e8","block_type":"box","text":"from only one dealer is available, in which case that dealer’s quotation may be used. The illiquidity of the derivatives","page_number":60,"box":{"x":68,"y":309,"width":831,"height":11}},{"id":"74004362-b64d-43ba-9dc9-b8dd22af635f","block_type":"box","text":"markets may be due to various factors, including congestion, disorderly markets, limitations on deliverable supplies,","page_number":60,"box":{"x":69,"y":324,"width":828,"height":12}},{"id":"a1d84923-abcf-442c-8ac0-065e755ac6b2","block_type":"box","text":"the par ticipation of speculators, government regulation and intervention, and technical and operational or system","page_number":60,"box":{"x":68,"y":339,"width":809,"height":12}},{"id":"55858d42-edf7-41d2-a404-4dbb79c091bc","block_type":"box","text":"failures. In addition, the liquidity of a market in an exchange-traded derivative contract may be adversely affected by","page_number":60,"box":{"x":68,"y":355,"width":826,"height":11}},{"id":"6c694b4d-c14b-48ef-b1f5-9e53389357f2","block_type":"box","text":"“daily price fluctuation limits” established by the exchanges which limit the amount of fluctuation in an exchange","page_number":60,"box":{"x":70,"y":370,"width":806,"height":11}},{"id":"28eb25ee-8001-45b1-bcab-0fd59bf5dda8","block_type":"box","text":"traded contract price during a single trading day. Once the daily limit has been reached in the contract, no trades may","page_number":60,"box":{"x":68,"y":385,"width":838,"height":11}},{"id":"2a40c29e-14e2-4092-9855-f804237e89fb","block_type":"box","text":"be entered into at a price beyond the limit, thus preventing the liquidation of open positions. Prices have in the past","page_number":60,"box":{"x":69,"y":400,"width":827,"height":11}},{"id":"1cc286b8-9586-4d97-b4d9-b03c257beb5b","block_type":"box","text":"moved to the daily limit on a number of consecutive trading days with little to no trading. If it is not possible to close","page_number":60,"box":{"x":69,"y":415,"width":828,"height":11}},{"id":"9572ab85-6edb-4dc1-84bd-421e832df577","block_type":"box","text":"an open derivative position entered into by the Fund, the Fund would continue to be required to make daily cash","page_number":60,"box":{"x":69,"y":430,"width":796,"height":11}},{"id":"b4db7067-8ae5-4c27-b32a-db5d3283c296","block_type":"box","text":"payments of variation margin in the event of adverse price movements. In such a situation, if the Fund has","page_number":60,"box":{"x":70,"y":445,"width":759,"height":12}},{"id":"505d0adf-0ca2-47e8-bd8b-ec5e0cafe93a","block_type":"box","text":"insufficient cash, it may have to sell por tfolio securities to meet daily variation margin requirements at a time when it","page_number":60,"box":{"x":70,"y":460,"width":837,"height":12}},{"id":"73bb3356-3a14-42f7-afe9-e19637360c9b","block_type":"box","text":"may be disadvantageous to do so.","page_number":60,"box":{"x":69,"y":476,"width":243,"height":11}},{"id":"306c7171-5153-4830-8e13-de0c63d203c0","block_type":"box","text":"Index Risk","page_number":60,"box":{"x":102,"y":498,"width":73,"height":9}},{"id":"7f374b30-9ae7-4e17-9948-0520ec3a9baa","block_type":"box","text":"— if the derivative is linked to the per formance of an index, it will be subject to the risks associated","page_number":60,"box":{"x":179,"y":498,"width":714,"height":11}},{"id":"eb095f35-bb2c-428f-9bc1-7e0bf4e0f462","block_type":"box","text":"with changes in that index. If the index changes, the Fund could receive lower interest payments or experience a","page_number":60,"box":{"x":68,"y":513,"width":800,"height":12}},{"id":"71f7aee5-806e-4d45-a189-b890d4cf60c5","block_type":"box","text":"reduction in the value of the derivative to below the price that the Fund paid for such derivative.","page_number":60,"box":{"x":69,"y":528,"width":678,"height":11}},{"id":"266d0685-e853-4d19-a7b6-01525d54f563","block_type":"box","text":"Legal Risk","page_number":60,"box":{"x":102,"y":551,"width":73,"height":11}},{"id":"163b0c78-d985-4ddb-87a8-7f68b3474368","block_type":"box","text":"— the risk of insufficient documentation, insufficient capacity or authority of counterpar ty, or legality","page_number":60,"box":{"x":179,"y":551,"width":717,"height":11}},{"id":"b807d3d5-5af0-42be-b714-8bc55f3387c8","block_type":"box","text":"or enforceability of a contract.","page_number":60,"box":{"x":69,"y":566,"width":211,"height":11}},{"id":"c33e57b4-b6a6-4f9e-b3ef-603319ad2b76","block_type":"box","text":"Leverage Risk","page_number":60,"box":{"x":102,"y":589,"width":99,"height":11}},{"id":"8145e134-3af3-4d8b-9e07-6044521a0947","block_type":"box","text":"— the risk that a Fund’s derivatives transactions can magnify the Fund’s gains and losses.","page_number":60,"box":{"x":205,"y":589,"width":648,"height":11}},{"id":"660942cb-2781-4dac-9f23-2cb9e7120802","block_type":"box","text":"Relatively small market movements may result in large changes in the value of a derivatives position and can result","page_number":60,"box":{"x":70,"y":604,"width":823,"height":11}},{"id":"c7f89e4b-7847-40e1-af79-93c0bb7f02bc","block_type":"box","text":"in losses that greatly exceed the amount originally invested.","page_number":60,"box":{"x":70,"y":619,"width":425,"height":11}},{"id":"b6cf5df9-8f0f-49e6-a6ab-5b18131a2015","block_type":"box","text":"Market Risk","page_number":60,"box":{"x":102,"y":642,"width":85,"height":9}},{"id":"4db9e191-2b18-4867-8bd4-97e5eec26073","block_type":"box","text":"— the risk that changes in the value of one or more markets or changes with respect to the value of","page_number":60,"box":{"x":191,"y":642,"width":716,"height":11}},{"id":"f041e298-ece2-4131-8eba-f84aa603ab79","block_type":"box","text":"the underlying asset will adversely affect the value of a derivative. In the event of an adverse movement, a Fund may","page_number":60,"box":{"x":68,"y":657,"width":833,"height":11}},{"id":"e1d7e896-3c37-4124-82f8-f0cb072c0178","block_type":"box","text":"be required to pay substantial additional margin to maintain its position or the Fund’s returns may be adversely","page_number":60,"box":{"x":69,"y":672,"width":794,"height":11}},{"id":"57f9cf30-d8c8-4ce6-80bd-92bee4cee969","block_type":"box","text":"affected.","page_number":60,"box":{"x":69,"y":687,"width":62,"height":9}},{"id":"804d2363-1c58-4060-94b6-d49f1fa891fa","block_type":"box","text":"Operational Risk","page_number":60,"box":{"x":102,"y":710,"width":117,"height":11}},{"id":"a987d78f-b54f-48ac-b319-36467e335c99","block_type":"box","text":"— the risk related to potential operational issues, including documentation issues, settlement","page_number":60,"box":{"x":223,"y":710,"width":674,"height":11}},{"id":"79263ca2-d7ff-4e7b-9768-5fbc91a55bbb","block_type":"box","text":"issues, systems failures, inadequate controls and human error.","page_number":60,"box":{"x":70,"y":725,"width":451,"height":11}},{"id":"2d8bd1d1-fd9c-4a06-8f6f-a113c70a0917","block_type":"box","text":"Valuation Risk","page_number":60,"box":{"x":103,"y":748,"width":99,"height":9}},{"id":"d26b7424-6211-4ec8-96cc-8e2ea15ff2ce","block_type":"box","text":"— the risk that valuation sources for a derivative will not be readily available in the market. This is","page_number":60,"box":{"x":206,"y":748,"width":701,"height":11}},{"id":"3c0bb7d0-b386-4bb6-8ea3-bd41a31ca0dc","block_type":"box","text":"possible especially in times of market distress, since many market par ticipants may be reluctant to purchase","page_number":60,"box":{"x":70,"y":763,"width":779,"height":11}},{"id":"98208602-e7df-43a8-a3e1-a7eae4e8afef","block_type":"box","text":"complex instruments or quote prices for them.","page_number":60,"box":{"x":69,"y":778,"width":329,"height":11}},{"id":"1cd49894-81ec-434f-8e6c-fd18c5b92933","block_type":"box","text":"Volatility Risk","page_number":60,"box":{"x":103,"y":801,"width":93,"height":11}},{"id":"c3c63704-f165-4b15-9d0a-17d2e48dc3c3","block_type":"box","text":"— the risk that the value of derivatives will fluctuate significantly within a shor t time period.","page_number":60,"box":{"x":200,"y":801,"width":652,"height":11}},{"id":"28f7340a-9d9d-4a32-b20f-2b24519e95b5","block_type":"box","text":"Types of Derivatives Transactions.","page_number":60,"box":{"x":103,"y":823,"width":240,"height":11}},{"id":"22cb3475-ebc5-4364-a26d-9a70eca814a4","block_type":"box","text":"A Fund may enter into derivatives transactions in accordance with its investment guidelines and restrictions,","page_number":60,"box":{"x":101,"y":846,"width":771,"height":11}},{"id":"c3115a5e-1666-4221-8950-00fd66d1d114","block_type":"box","text":"including the following:","page_number":60,"box":{"x":70,"y":861,"width":159,"height":11}},{"id":"b5cb9614-64f7-40f7-b455-92f354bab354","block_type":"box","text":"Futures.","page_number":60,"box":{"x":102,"y":884,"width":56,"height":9}},{"id":"df282b82-9abc-45ef-b294-366399df413b","block_type":"box","text":"II-16","page_number":60,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"a4990f0a-6f46-44aa-b5e1-6032b94cd5a5","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":60,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"0cd112ce-03ef-4f3a-826d-e2ebb52777de","block_type":"box","text":"A Fund may enter into futures contracts (“futures”) and options on futures contracts. Futures are standardized,","page_number":61,"box":{"x":101,"y":45,"width":791,"height":11}},{"id":"8a4ca09e-6a7d-49fe-892c-ef22a50e7f08","block_type":"box","text":"exchange-traded contracts that require a purchaser to take delivery, and a seller to make delivery, of a specified","page_number":61,"box":{"x":69,"y":60,"width":799,"height":11}},{"id":"41a858a3-fd81-43c3-ae2f-ef447e8c75d1","block_type":"box","text":"amount of an asset at a specified future date and price. Upon purchasing or selling a futures contract, a Fund is","page_number":61,"box":{"x":69,"y":75,"width":800,"height":11}},{"id":"b07bac9d-61a7-48b2-af93-5e30fc610f19","block_type":"box","text":"required to deposit initial margin equal to a percentage of the contract value. Futures contracts are marked to market","page_number":61,"box":{"x":69,"y":90,"width":838,"height":11}},{"id":"7e7ea107-e9e2-4d2b-8d77-b52824e0c9ca","block_type":"box","text":"daily for the duration of the contract, and the Fund will either post additional margin or be entitled to a payment, as","page_number":61,"box":{"x":69,"y":105,"width":820,"height":11}},{"id":"419cfe0e-242e-4dcb-8321-7fb59a75433c","block_type":"box","text":"applicable, based on the mark-to-market movement of the contract.","page_number":61,"box":{"x":69,"y":120,"width":478,"height":11}},{"id":"84b60fb5-a4c7-4958-8a57-29a8d50c13f9","block_type":"box","text":"A Fund may sell a futures contract prior to the completion of its term to limit its risk of loss from a decline in the","page_number":61,"box":{"x":101,"y":143,"width":801,"height":11}},{"id":"280677e0-b463-446b-928e-cff4e20759b0","block_type":"box","text":"market value of por tfolio holdings correlated with the futures contract. However, in the event the market value of the","page_number":61,"box":{"x":69,"y":158,"width":829,"height":11}},{"id":"668985f8-675c-44cd-a8c3-e3c1e461775c","block_type":"box","text":"por tfolio holdings correlated with the futures contract increases rather than decreases, a Fund will realize a loss on","page_number":61,"box":{"x":70,"y":173,"width":822,"height":11}},{"id":"32393896-4a2e-419e-8164-a06c1ed25c8a","block_type":"box","text":"the futures position and a lower return on the por tfolio holdings than would have been realized without the purchase","page_number":61,"box":{"x":68,"y":188,"width":830,"height":12}},{"id":"d909cc48-b535-4c8b-bce6-cfb1b303148a","block_type":"box","text":"of the futures contract.","page_number":61,"box":{"x":69,"y":203,"width":162,"height":9}},{"id":"4071c88a-a4f5-47ce-886e-51b65e96addf","block_type":"box","text":"The purchase of a futures contract may provide a Fund a lower cost alternative to purchasing securities or","page_number":61,"box":{"x":101,"y":226,"width":756,"height":11}},{"id":"5d290cb9-5fe2-4b79-92ab-8907eae67ecf","block_type":"box","text":"commodities directly. In the event that such securities or commodities decline in value or a Fund determines not to","page_number":61,"box":{"x":69,"y":241,"width":820,"height":11}},{"id":"4d9fa269-91c9-420e-9fec-4262133a26f9","block_type":"box","text":"complete an anticipatory hedge transaction relating to a futures contract, however, the Fund may realize a loss","page_number":61,"box":{"x":69,"y":256,"width":789,"height":12}},{"id":"34699ed9-ec15-4b47-bae7-f565cf11eab9","block_type":"box","text":"relating to the futures position.","page_number":61,"box":{"x":69,"y":271,"width":219,"height":12}},{"id":"472b56aa-f129-4b6b-b197-ce66448178f4","block_type":"box","text":"Futures contracts are also subject to position limits. In order to comply with position limits, a Fund may be","page_number":61,"box":{"x":102,"y":294,"width":757,"height":11}},{"id":"abb157f6-4a92-4f04-bdd3-b63e1db6d106","block_type":"box","text":"required to liquidate positions or may not be able to fully implement trading instructions. Any such liquidation or","page_number":61,"box":{"x":69,"y":309,"width":797,"height":11}},{"id":"65067ee6-b504-47fa-a2cf-990bad293af4","block_type":"box","text":"limited implementation could result in substantial costs to a Fund. See “—Regulation of Derivatives — Dodd-Frank","page_number":61,"box":{"x":70,"y":324,"width":816,"height":12}},{"id":"ccb92925-e388-4c47-b204-f2bf1b451aa0","block_type":"box","text":"Regulations” above.","page_number":61,"box":{"x":70,"y":340,"width":140,"height":11}},{"id":"c0683424-af5d-4853-9bbf-42a34c0f6e4f","block_type":"box","text":"A Fund is also permitted to purchase or sell call and put options on futures contracts, including financial futures","page_number":61,"box":{"x":101,"y":362,"width":799,"height":11}},{"id":"c82cd2d3-2964-4af6-bb0d-bddcddca73e9","block_type":"box","text":"and stock indices. Generally, these strategies would be used under the same market and market sector conditions","page_number":61,"box":{"x":69,"y":377,"width":818,"height":12}},{"id":"bac1d842-d414-472d-98b3-2a61be9920b1","block_type":"box","text":"(","page_number":61,"box":{"x":69,"y":393,"width":3,"height":10}},{"id":"f57a6060-0e71-4be8-91db-2ab64a82e6c5","block_type":"box","text":"i.e.","page_number":61,"box":{"x":74,"y":393,"width":21,"height":8}},{"id":"70c7bd8b-8b21-4537-8a71-b5d295d124d1","block_type":"box","text":", conditions relating to specific types of investments) in which the Fund entered into futures transactions. A Fund","page_number":61,"box":{"x":97,"y":392,"width":803,"height":12}},{"id":"4876c19b-0e87-430a-8b2c-f9f739e81366","block_type":"box","text":"may purchase put options or write call options on futures contracts and stock indices in lieu of selling the underlying","page_number":61,"box":{"x":69,"y":407,"width":830,"height":12}},{"id":"3fcde310-816f-46dc-832d-ce7969da6d03","block_type":"box","text":"futures contract in anticipation of a decrease in the market value of its securities. Similarly, a Fund can purchase call","page_number":61,"box":{"x":68,"y":423,"width":835,"height":11}},{"id":"1fca7b86-f5ee-4b90-8509-204baade7cfb","block_type":"box","text":"options, or write put options on futures contracts and stock indices, as a substitute for the purchase of such futures","page_number":61,"box":{"x":69,"y":438,"width":831,"height":11}},{"id":"6dc0122c-d4d8-4f7b-965e-b08db82e6a5a","block_type":"box","text":"contracts to hedge against the increased cost resulting from an increase in the market value of securities which the","page_number":61,"box":{"x":69,"y":453,"width":826,"height":11}},{"id":"7062d271-f642-41ee-bba2-ad13881d9638","block_type":"box","text":"Fund intends to purchase.","page_number":61,"box":{"x":70,"y":468,"width":183,"height":11}},{"id":"5131e632-57dd-4e05-a579-0fe57267f535","block_type":"box","text":"To maintain greater flexibility, a Fund may invest in instruments which have characteristics similar to futures","page_number":61,"box":{"x":101,"y":491,"width":768,"height":11}},{"id":"a0f5159f-9421-4cd1-a326-4c89cb0e6142","block_type":"box","text":"contracts. These instruments may take a variety of forms, such as debt securities with interest or principal payments","page_number":61,"box":{"x":69,"y":506,"width":835,"height":11}},{"id":"6bccec3a-7cf4-44de-b1ef-d1b73f90d838","block_type":"box","text":"determined by reference to the value of a security, an index of securities or a commodity at a future point in time. The","page_number":61,"box":{"x":69,"y":521,"width":839,"height":11}},{"id":"dd57e4fc-1215-42b4-9878-e8aee3042982","block_type":"box","text":"risks of such investments could reflect the risks of investing in futures and securities, including volatility and","page_number":61,"box":{"x":69,"y":536,"width":773,"height":11}},{"id":"d2a43ee0-e591-4584-97fb-824c8299fd68","block_type":"box","text":"illiquidity.","page_number":61,"box":{"x":70,"y":551,"width":63,"height":11}},{"id":"1bd73572-f8b0-455c-ad48-0772e0d7f1d4","block_type":"box","text":"Futures contracts and options on futures contracts are subject to significant correlation risk, leverage risk,","page_number":61,"box":{"x":102,"y":574,"width":757,"height":11}},{"id":"ec1a36ed-1a53-41a5-80e0-c8e68c41019b","block_type":"box","text":"illiquidity risk, market risk and counterpar ty risk with respect to a Fund’s futures broker or the clearinghouse. See","page_number":61,"box":{"x":70,"y":589,"width":807,"height":11}},{"id":"437f0c48-e8c1-4e31-9e42-72f9789c3ac9","block_type":"box","text":"“—Risk Factors in Derivatives” above.","page_number":61,"box":{"x":70,"y":604,"width":269,"height":9}},{"id":"21fad3a6-e86a-4c4f-8a67-f5bcea10b835","block_type":"box","text":"Cer tain Funds may invest in futures based on carbon “allowances.” Under cer tain regulatory regimes, a limit is","page_number":61,"box":{"x":102,"y":627,"width":791,"height":11}},{"id":"f7df8060-0946-4dd1-b068-28e4475aa035","block_type":"box","text":"set by a regulator, such as a government entity, on the total amount of specific greenhouse gases, such as CO2, that","page_number":61,"box":{"x":69,"y":642,"width":838,"height":11}},{"id":"119c13e3-8471-4f76-b591-10a88658586f","block_type":"box","text":"can be emitted by regulated entities, such as manufacturers or energy producers. The regulator then may issue or","page_number":61,"box":{"x":69,"y":657,"width":814,"height":11}},{"id":"75ee4ce9-7700-4969-9ef6-ba854e276aef","block_type":"box","text":"sell individual “emission allowances” to regulated entities, which can then be traded on the open market. Commodity","page_number":61,"box":{"x":69,"y":672,"width":837,"height":11}},{"id":"f268fe79-a21d-4a3a-a4d9-00c7cddb4fc5","block_type":"box","text":"futures contracts linked to the value of emission allowances are known as “carbon futures.”","page_number":61,"box":{"x":68,"y":687,"width":657,"height":9}},{"id":"78ac1bde-ad99-478a-a637-e4f601485e0b","block_type":"box","text":"The price for carbon futures contracts is based on a number of factors, including the supply of and the demand","page_number":61,"box":{"x":101,"y":710,"width":792,"height":11}},{"id":"19c864d1-e683-45f1-9186-6748cf0415e6","block_type":"box","text":"for carbon futures contracts. Changes in law, market conditions and expectations, position limits, collateral","page_number":61,"box":{"x":68,"y":725,"width":764,"height":11}},{"id":"eec38687-30be-45f2-92ec-bb2f8af62be6","block_type":"box","text":"requirements, and other factors each can impact the supply of and demand for carbon futures contracts. The market","page_number":61,"box":{"x":69,"y":740,"width":832,"height":11}},{"id":"0f50ff92-61d8-49d3-8f53-3b38fee4c86d","block_type":"box","text":"for carbon futures contracts is still developing and may be subject to periods of illiquidity. During such times it may be","page_number":61,"box":{"x":68,"y":755,"width":841,"height":11}},{"id":"c8a30b91-2262-4536-b87c-17b86426075c","block_type":"box","text":"difficult or impossible to buy or sell a position at the desired price. Market disruptions or volatility can also make it","page_number":61,"box":{"x":69,"y":770,"width":819,"height":11}},{"id":"8cedae45-ba14-4ea6-9cc0-49e88feda97d","block_type":"box","text":"difficult to find a counterpar ty willing to transact at a reasonable price and sufficient size.","page_number":61,"box":{"x":69,"y":785,"width":637,"height":12}},{"id":"657d932a-d003-4418-b0cb-3b616a80b417","block_type":"box","text":"Swap Agreements.","page_number":61,"box":{"x":102,"y":808,"width":131,"height":11}},{"id":"ffeca742-d7c1-4de0-8d21-004f5841199b","block_type":"box","text":"A Fund may enter into swap agreements for hedging purposes or speculative purposes. Swap agreements are","page_number":61,"box":{"x":101,"y":831,"width":782,"height":11}},{"id":"c74ca61a-682a-4f4c-b6ce-8fdfb11b3fe9","block_type":"box","text":"OTC contracts entered into primarily by financial institutions and institutional investors which may or may not be","page_number":61,"box":{"x":69,"y":846,"width":796,"height":11}},{"id":"3fe09e99-af92-4f62-9a6f-4b25a10e153f","block_type":"box","text":"cleared by a central clearinghouse. In a standard “swap” transaction, two par ties agree to exchange the returns","page_number":61,"box":{"x":69,"y":861,"width":799,"height":11}},{"id":"102c6a0b-95e1-4af5-8d28-741cb38e21bf","block_type":"box","text":"earned or realized from one or more underlying assets or rates of return, which may be adjusted for an interest","page_number":61,"box":{"x":69,"y":876,"width":792,"height":11}},{"id":"4ba44114-cc3a-4bfe-8876-3d726dc55bb7","block_type":"box","text":"factor. The gross returns to be exchanged or “swapped” between the par ties are generally calculated with respect to","page_number":61,"box":{"x":68,"y":891,"width":832,"height":12}},{"id":"35d6de0b-fd35-4ee9-8971-d6bd4ab696cc","block_type":"box","text":"a “notional amount,”","page_number":61,"box":{"x":69,"y":907,"width":147,"height":10}},{"id":"8e4247d3-7fb5-4e25-8f7d-b351912fcdbd","block_type":"box","text":"e.g.","page_number":61,"box":{"x":223,"y":908,"width":25,"height":10}},{"id":"fcc260be-bb0e-47e4-b7f4-c77a71688aa7","block_type":"box","text":", the return or increase in value of a par ticular dollar amount invested at a par ticular","page_number":61,"box":{"x":251,"y":906,"width":602,"height":11}},{"id":"3a6a4885-b0bf-4a85-a547-8bba02be1cd7","block_type":"box","text":"II-17","page_number":61,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"0b7455c2-39c5-4feb-8679-ddd11cd21bec","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":61,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"baeb5330-b272-4fee-9ea5-fc11d708a783","block_type":"box","text":"interest rate, in a par ticular foreign currency, or in a “basket” of securities representing a par ticular index. The","page_number":62,"box":{"x":70,"y":45,"width":787,"height":11}},{"id":"246e61f3-6e29-4862-b236-d2dc47e7345a","block_type":"box","text":"notional amount of the swap agreement is only used to calculate the obligations that the par ties to a swap","page_number":62,"box":{"x":69,"y":60,"width":762,"height":11}},{"id":"cdbd50db-5041-4b6e-b66e-0d0a74fdd1ed","block_type":"box","text":"agreement have agreed to exchange. A Fund’s obligations (or rights) under a swap agreement will generally be equal","page_number":62,"box":{"x":69,"y":75,"width":828,"height":11}},{"id":"c6a2b3bf-0923-4545-8bd8-f0a699fb912b","block_type":"box","text":"only to the net amount to be paid or received under the agreement based on the relative values of the positions held","page_number":62,"box":{"x":69,"y":90,"width":832,"height":11}},{"id":"c86df251-b5c7-4a46-96cd-116996e487ff","block_type":"box","text":"by each par ty to the agreement. Swaps that are not cleared involve substantial counterpar ty risk. A Fund will typically","page_number":62,"box":{"x":69,"y":105,"width":835,"height":11}},{"id":"62d9690e-d6c7-4911-b9e6-a87a689d8fd0","block_type":"box","text":"attempt to mitigate this counterpar ty risk by entering into swap agreements only with creditwor thy entities that have","page_number":62,"box":{"x":69,"y":120,"width":826,"height":12}},{"id":"55669cec-9548-48ee-aefb-d607c2c97075","block_type":"box","text":"substantial capital or that have provided the Fund with a third-par ty guaranty or other credit suppor t. A Fund’s ability","page_number":62,"box":{"x":69,"y":136,"width":827,"height":11}},{"id":"4164c7be-30d8-4059-a95f-46f591b8a07e","block_type":"box","text":"to use swap agreements may be restricted by the tax rules applicable to registered investment companies.","page_number":62,"box":{"x":68,"y":151,"width":763,"height":11}},{"id":"8faf78b2-9dfe-43d0-b2e4-d83294b290f2","block_type":"box","text":"Credit Default Swaps and Similar Instruments.","page_number":62,"box":{"x":102,"y":173,"width":329,"height":11}},{"id":"878a72b0-41b9-403f-b8d4-9272cf4d5e4a","block_type":"box","text":"Cer tain Funds may enter into credit default swaps and similar","page_number":62,"box":{"x":438,"y":173,"width":439,"height":11}},{"id":"eace4bce-87cd-47b3-b46c-b538c3a8d568","block_type":"box","text":"instruments. Credit default swaps are standardized agreements in which the protection “buyer” pays the protection","page_number":62,"box":{"x":70,"y":188,"width":821,"height":12}},{"id":"8c2ad830-6af2-4341-a611-9b79477975dc","block_type":"box","text":"“seller” an up-front payment, or a periodic stream of payments, over the term of the contract, provided generally that","page_number":62,"box":{"x":70,"y":203,"width":831,"height":12}},{"id":"8aa4a49f-38f5-49b2-8a9c-0688d7b94113","block_type":"box","text":"no credit event on a reference obligation has occurred. If a credit event occurs, the seller generally must pay the","page_number":62,"box":{"x":69,"y":218,"width":801,"height":12}},{"id":"52a5cf2d-2711-49ee-895d-b49cd4e4cca0","block_type":"box","text":"buyer the difference between the notional amount of the contract and the value of a por tfolio of securities issued by","page_number":62,"box":{"x":69,"y":234,"width":829,"height":11}},{"id":"476b6bb3-8398-4869-95fc-33fbb78d5f5c","block_type":"box","text":"the reference entity. A Fund may be either the buyer or seller in the transaction. The Funds may enter into credit","page_number":62,"box":{"x":68,"y":249,"width":798,"height":11}},{"id":"5084ede6-352c-4fe1-8fc9-8344192003c8","block_type":"box","text":"default swaps that reference the obligations of a single entity (“single-name CDS”) or the obligations of entities that","page_number":62,"box":{"x":69,"y":264,"width":827,"height":11}},{"id":"476e45da-65b5-48ad-87b6-65b1d3fbe8e3","block_type":"box","text":"make up an index (“index CDS”). References to “credit default swaps” shall collectively refer to single-name CDS and","page_number":62,"box":{"x":69,"y":279,"width":836,"height":11}},{"id":"6bbd9176-9e6a-4afa-9c5a-f2c362909a4e","block_type":"box","text":"index CDS.","page_number":62,"box":{"x":70,"y":294,"width":75,"height":9}},{"id":"556ca0cb-9613-495c-8aba-079a7ec02254","block_type":"box","text":"Credit default swaps have as reference obligations one or more securities or loans that are not currently held by","page_number":62,"box":{"x":102,"y":317,"width":800,"height":11}},{"id":"659c21d1-67c8-46df-a373-b5ee68b4cd31","block_type":"box","text":"a Fund. In circumstances in which a Fund does not own the securities or loans that are deliverable under a credit","page_number":62,"box":{"x":69,"y":332,"width":806,"height":9}},{"id":"a331316e-e352-41ab-82c1-83f5a7bac728","block_type":"box","text":"default swap, the Fund is exposed to the risk that deliverable securities will not be available in the market, or will be","page_number":62,"box":{"x":69,"y":347,"width":828,"height":11}},{"id":"7e1ea66a-ddcc-48ab-a733-82d69393aba4","block_type":"box","text":"available only at unfavorable prices, as would be the case in a so-called “shor t squeeze.” In cer tain instances of","page_number":62,"box":{"x":69,"y":362,"width":804,"height":11}},{"id":"60a54f74-d0cb-4339-a7f8-d9f006ad50c1","block_type":"box","text":"issuer defaults or restructurings, it has been unclear under the standard industry documentation for credit default","page_number":62,"box":{"x":70,"y":377,"width":812,"height":12}},{"id":"ab5665e2-6143-4806-aa63-230c83bd6279","block_type":"box","text":"swaps whether or not a “credit event” triggering the seller’s payment obligation had occurred. Cer tain initiatives","page_number":62,"box":{"x":69,"y":392,"width":798,"height":12}},{"id":"ea402ee4-df21-4e88-ba84-27eb2a6a88cd","block_type":"box","text":"adopted by derivatives market par ticipants, including the International Swaps and Derivatives Association (“ISDA”),","page_number":62,"box":{"x":69,"y":408,"width":819,"height":11}},{"id":"4d9e1560-0f79-40dc-b23c-8bd7562ebe84","block_type":"box","text":"are designed to implement uniform settlement terms into standard credit default swap documentation, as well as","page_number":62,"box":{"x":69,"y":423,"width":810,"height":11}},{"id":"9ff2069a-164c-4e5b-a679-e664d6a66b5d","block_type":"box","text":"refine the practices for the transparent conduct of the credit default swap market generally. Among these initiatives","page_number":62,"box":{"x":69,"y":438,"width":821,"height":11}},{"id":"9409676c-e2d2-48d3-b12a-14d7d0dc5c9b","block_type":"box","text":"are the ISDA Credit Derivatives Determination Committee and the implementation of market-wide cash settlement","page_number":62,"box":{"x":69,"y":453,"width":811,"height":11}},{"id":"5d9e5eaf-41d3-4f71-95aa-a60ac4647d2a","block_type":"box","text":"protocols applicable to all market-standard credit default swaps. These initiatives are intended to reduce both the","page_number":62,"box":{"x":70,"y":468,"width":809,"height":11}},{"id":"26fd6edb-cd11-4420-ab97-be182dd29389","block_type":"box","text":"uncer tainty as to the occurrence of credit events and the risk of a “shor t squeeze” by providing that the ISDA Credit","page_number":62,"box":{"x":69,"y":483,"width":827,"height":11}},{"id":"65ffb104-33a4-4e6c-ae94-dbe617b1c480","block_type":"box","text":"Derivatives Determinations Committee will make determinations as to whether a credit event has occurred, establish","page_number":62,"box":{"x":70,"y":498,"width":834,"height":11}},{"id":"a86aecb5-1307-435a-9f4b-75700f92a948","block_type":"box","text":"an auction to determine a settlement price and identify the deliverable securities for purposes of the auction,","page_number":62,"box":{"x":69,"y":513,"width":778,"height":11}},{"id":"e5615853-4640-4e19-bb1e-6efe434a0de6","block_type":"box","text":"although the ISDA Credit Derivatives Determinations Committee may in cer tain limited circumstances refrain from","page_number":62,"box":{"x":69,"y":528,"width":809,"height":12}},{"id":"386f430f-0325-4bdb-91bc-c0cd76ad196f","block_type":"box","text":"doing so. In the event the ISDA Credit Derivatives Determinations Committee cannot reach a timely resolution with","page_number":62,"box":{"x":69,"y":544,"width":815,"height":11}},{"id":"1f4a2372-6eea-4268-b3d8-d46c234c7514","block_type":"box","text":"respect to a “credit event” or otherwise does not establish a cash settlement auction, a Fund may not be able to","page_number":62,"box":{"x":69,"y":559,"width":807,"height":11}},{"id":"26c58e75-2a7b-4f5c-8ba3-3a9acd03f4b0","block_type":"box","text":"realize the full value of the credit default swap upon a default by the reference entity. Fur thermore, a Fund may enter","page_number":62,"box":{"x":69,"y":574,"width":832,"height":11}},{"id":"edc9887d-ca48-457b-84df-17fe31ab101e","block_type":"box","text":"into cer tain credit default swaps or similar instruments that may not be covered by these initiatives.","page_number":62,"box":{"x":70,"y":589,"width":711,"height":11}},{"id":"1123a5b1-b7cc-4896-9806-5ccac2944e9d","block_type":"box","text":"If a Fund is a buyer, it will lose the payments made under the terms of the credit default swap and recover","page_number":62,"box":{"x":102,"y":612,"width":757,"height":11}},{"id":"53f1a835-5eac-4b55-91d4-7ec45005de7f","block_type":"box","text":"nothing should no credit event occur. If a Fund is a seller and a credit event occurs, the value of any deliverable","page_number":62,"box":{"x":69,"y":627,"width":794,"height":11}},{"id":"668ce483-0d2d-4992-8004-2a2957797728","block_type":"box","text":"obligation received by the Fund or the amount of cash settlement received by the Fund pursuant to the relevant cash","page_number":62,"box":{"x":69,"y":642,"width":830,"height":11}},{"id":"d0ce7bfb-0e18-4aff-8424-bfc4780a84e3","block_type":"box","text":"settlement auction, together with the up-front or periodic payments previously received, may be less than the amount","page_number":62,"box":{"x":69,"y":657,"width":835,"height":11}},{"id":"f6bdb551-9440-4850-b3f6-3e4d5a38fc33","block_type":"box","text":"it pays to the buyer, resulting in a loss of value to the Fund. A Fund that sells credit default swaps incurs leveraged","page_number":62,"box":{"x":70,"y":672,"width":817,"height":11}},{"id":"8da09c03-5086-47c9-ba1c-7262f0401c85","block_type":"box","text":"exposure to the credit of one or more reference entities and is subject to many of the same risks it would incur if it","page_number":62,"box":{"x":69,"y":687,"width":820,"height":11}},{"id":"37ecd2fa-283d-4b9c-8170-e978fcfbe4f7","block_type":"box","text":"were holding debt securities issued by the relevant reference entity. However, a Fund will not have any legal recourse","page_number":62,"box":{"x":68,"y":702,"width":833,"height":12}},{"id":"bf8dc2be-734b-4069-803a-fcb5ed9f9f6c","block_type":"box","text":"against any reference entity and will not benefit from any collateral securing the reference entity’s debt obligations. In","page_number":62,"box":{"x":69,"y":717,"width":837,"height":12}},{"id":"96cb0fe1-a00f-4c3d-8a5f-15beef51f486","block_type":"box","text":"the event the ISDA Credit Derivatives Determinations Committee does not establish a cash settlement auction and","page_number":62,"box":{"x":68,"y":733,"width":820,"height":9}},{"id":"9fd1ddea-bd6f-4ce7-be6f-88cf683d8d0a","block_type":"box","text":"identify the relevant deliverable securities or loans, the credit default swap buyer will have broad discretion to select","page_number":62,"box":{"x":70,"y":748,"width":828,"height":11}},{"id":"93dd2fd3-c601-4b42-ad40-0be3520e4afa","block_type":"box","text":"which of the reference entity’s debt obligations to deliver to the Fund following a credit event and will likely choose","page_number":62,"box":{"x":68,"y":763,"width":815,"height":11}},{"id":"22206b66-d428-4255-b761-85c270455f46","block_type":"box","text":"the obligations with the lowest market value in order to maximize the payment obligations of the Fund. In addition,","page_number":62,"box":{"x":68,"y":778,"width":814,"height":11}},{"id":"d5d88fe1-f1b5-447e-8c4e-222b1b2aa2a7","block_type":"box","text":"credit default swaps generally trade on the basis of theoretical pricing and valuation models, which may not","page_number":62,"box":{"x":69,"y":793,"width":766,"height":11}},{"id":"283f2bbf-c013-4db3-9968-c27d9266ec75","block_type":"box","text":"accurately value such swap positions when established or when subsequently traded or unwound under actual market","page_number":62,"box":{"x":69,"y":808,"width":840,"height":11}},{"id":"8575fe42-d2a4-443d-8bf0-d2519a001c12","block_type":"box","text":"conditions.","page_number":62,"box":{"x":69,"y":823,"width":76,"height":9}},{"id":"c0d57f0c-f030-40fe-8727-548f85e21114","block_type":"box","text":"Dodd-Frank requires that cer tain index CDS be executed in regulated markets and submitted for clearing to","page_number":62,"box":{"x":102,"y":846,"width":762,"height":11}},{"id":"d1408338-9db1-457e-bd2d-93fde21c270b","block_type":"box","text":"regulated clearinghouses. See “—Derivatives — Regulation of Derivatives — Dodd-Frank Regulations” above. Other","page_number":62,"box":{"x":69,"y":861,"width":824,"height":11}},{"id":"1d7844d2-e030-4e93-8247-bb04f098564c","block_type":"box","text":"single-name CDS and index CDS are permitted, although not required, to be cleared through regulated","page_number":62,"box":{"x":69,"y":876,"width":727,"height":11}},{"id":"ed1d20a2-9e59-4658-9a29-494034fe5081","block_type":"box","text":"clearinghouses. The Funds clear all credit default swaps that are subject to mandatory clearing and may voluntarily","page_number":62,"box":{"x":69,"y":891,"width":819,"height":12}},{"id":"b35fcc72-2dd4-4ddb-8fae-229543ca0e03","block_type":"box","text":"clear some, but not all, of the other credit default swaps not subject to mandatory clearing. The Funds face","page_number":62,"box":{"x":69,"y":906,"width":764,"height":12}},{"id":"a65ab4bb-c390-4435-aae3-4dad46d9df61","block_type":"box","text":"II-18","page_number":62,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"19193d65-5da4-46e2-ab49-4b209929e1e2","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":62,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"7c0057fc-238f-4e5d-b88c-1f4f0f2f8ee5","block_type":"box","text":"counterpar ty risk with respect to the clearinghouse when entering into cleared single-name CDS and cleared index","page_number":63,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"27a22fbb-502e-4776-99fd-15072349ac05","block_type":"box","text":"CDS. The Funds face significant counterpar ty risk with respect to their counterpar ties to non-cleared credit default","page_number":63,"box":{"x":69,"y":60,"width":813,"height":11}},{"id":"20ef735c-ebbb-4e6e-a599-9cf3bb823d85","block_type":"box","text":"swaps and similar instruments. A Fund typically will enter into non-cleared credit default swaps and similar","page_number":63,"box":{"x":69,"y":75,"width":759,"height":11}},{"id":"fef57744-ff25-4840-84ac-dbe09437060c","block_type":"box","text":"instruments with swap dealers and creditwor thy entities that have substantial capital or that have provided the Fund","page_number":63,"box":{"x":70,"y":90,"width":828,"height":11}},{"id":"8dc8cef5-45b4-4bbb-8873-18648ed24c52","block_type":"box","text":"with a third-par ty guaranty or other credit suppor t.","page_number":63,"box":{"x":68,"y":105,"width":355,"height":11}},{"id":"a2e3bf93-8d5c-4bd6-ba59-335aa94be857","block_type":"box","text":"In cer tain instances, a Fund may enter into bespoke credit default swaps or similar instruments either as","page_number":63,"box":{"x":102,"y":128,"width":750,"height":11}},{"id":"aa3ab3f3-8151-42a6-bf72-fefbf26a33c3","block_type":"box","text":"protection buyer or protection seller. While these contracts are similar in their operation to the market-standard credit","page_number":63,"box":{"x":70,"y":143,"width":836,"height":11}},{"id":"172387b8-cdaa-42b9-a2c5-c8b71df3d1a8","block_type":"box","text":"default swaps described above, they are less standardized and instead have bespoke or tailored features. For","page_number":63,"box":{"x":69,"y":158,"width":785,"height":11}},{"id":"24505b5f-73ec-4352-89d1-223a303ee3cf","block_type":"box","text":"example, as compared to market-standard credit defaults, the range of “credit events” triggering settlement of such","page_number":63,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"17a65bf9-6f59-4ce6-8de4-b0e9f5edf96a","block_type":"box","text":"bespoke contracts may be narrower or broader, any such triggered contracts are settled by physical delivery of the","page_number":63,"box":{"x":69,"y":188,"width":814,"height":12}},{"id":"4d869720-4d8e-4665-b605-36ab0be4a029","block_type":"box","text":"underlying security or loan to or by the Fund rather than by way of cash settlement, and there may be a wider range of","page_number":63,"box":{"x":69,"y":203,"width":839,"height":12}},{"id":"6862de3d-f8fa-4991-9de7-5373fb2f242f","block_type":"box","text":"securities as the reference obligations and/or deliverable obligations.","page_number":63,"box":{"x":69,"y":218,"width":495,"height":12}},{"id":"42ec8372-4350-491b-92b3-d5339e1cca05","block_type":"box","text":"In addition, credit default swaps and similar instruments generally involve greater risks than if a Fund had","page_number":63,"box":{"x":102,"y":241,"width":752,"height":11}},{"id":"6d06f4e6-7a00-444c-bf3d-a1e5dd987625","block_type":"box","text":"invested in the reference obligation directly and are subject to significant credit risk, correlation risk, leverage risk,","page_number":63,"box":{"x":70,"y":256,"width":814,"height":12}},{"id":"624e8ec2-77b9-43db-be82-883f14124c99","block_type":"box","text":"illiquidity risk and market risk. See “—Risk Factors in Derivatives” above.","page_number":63,"box":{"x":70,"y":272,"width":520,"height":11}},{"id":"48cbf323-9b18-48db-85cc-f501184887d2","block_type":"box","text":"Interest Rate Swaps, Floors and Caps.","page_number":63,"box":{"x":102,"y":294,"width":273,"height":11}},{"id":"7ce5adc3-1402-47f2-9be3-890ce1613a9f","block_type":"box","text":"Cer tain Funds may enter into OTC derivatives in the form of interest rate","page_number":63,"box":{"x":381,"y":294,"width":515,"height":11}},{"id":"b01e6e71-5a03-4aa8-afea-a446fd76fd8c","block_type":"box","text":"swaps and interest rate caps and floors. As described in fur ther detail below, a Fund may enter into these","page_number":63,"box":{"x":69,"y":309,"width":755,"height":11}},{"id":"427618d1-3059-4d6c-9c00-e0e359aea5c2","block_type":"box","text":"transactions primarily to preserve a return or spread on a par ticular investment or por tion of its holdings, as a","page_number":63,"box":{"x":68,"y":324,"width":788,"height":12}},{"id":"ce12ebce-5bed-4d65-8354-e311df4ca738","block_type":"box","text":"duration management technique, to protect against an increase in the price of securities a Fund anticipates","page_number":63,"box":{"x":69,"y":339,"width":768,"height":12}},{"id":"b2c0b002-9005-4c6c-8946-88202672e94d","block_type":"box","text":"purchasing at a later date, or for speculation to increase returns.","page_number":63,"box":{"x":70,"y":355,"width":461,"height":11}},{"id":"f28fe3bb-b745-4dc9-b0cd-356536b06dd2","block_type":"box","text":"Dodd-Frank requires that cer tain interest rate swaps be executed in regulated markets and submitted for","page_number":63,"box":{"x":102,"y":377,"width":748,"height":12}},{"id":"de39a6fb-5bf9-43b2-9075-5f3bfc57d4dc","block_type":"box","text":"clearing to regulated clearinghouses. See “—Regulation of Derivatives — Dodd-Frank Regulations” above. Other","page_number":63,"box":{"x":69,"y":392,"width":799,"height":12}},{"id":"bb570240-ff37-4df1-817c-91521ebd687b","block_type":"box","text":"interest rate swaps are permitted, although not required, to be cleared. Most of the interest rate swaps entered into","page_number":63,"box":{"x":70,"y":407,"width":829,"height":12}},{"id":"5fa38f56-138e-4578-94be-85da0a6641d1","block_type":"box","text":"by the Funds are cleared. The Funds face counterpar ty risk with respect to the clearinghouse when entering into","page_number":63,"box":{"x":69,"y":423,"width":797,"height":11}},{"id":"92456ed0-b84d-43d2-a61d-1adb6141ca19","block_type":"box","text":"cleared interest rate swaps.","page_number":63,"box":{"x":69,"y":438,"width":198,"height":11}},{"id":"be33f4b5-d5b8-4860-9937-72f024486985","block_type":"box","text":"The Funds face significant counterpar ty risk with respect to their counterpar ties to non-cleared interest rate","page_number":63,"box":{"x":101,"y":460,"width":766,"height":12}},{"id":"41ab1cce-d785-4c4b-8cd3-b94dd6e70863","block_type":"box","text":"swaps and interest rate caps and floors. The typical counterpar ties for a Fund’s non-cleared interest rate derivatives","page_number":63,"box":{"x":69,"y":475,"width":829,"height":12}},{"id":"40091f7a-d821-4965-bdc6-b23eb7fb3ece","block_type":"box","text":"transactions are swap dealers and other creditwor thy entities that have substantial capital or that have provided the","page_number":63,"box":{"x":68,"y":491,"width":830,"height":11}},{"id":"eaf5f74f-70b7-4652-a825-772ea4367884","block_type":"box","text":"Fund with a third-par ty guaranty or other credit suppor t. If the Fund’s counterpar ty defaults on such a transaction, a","page_number":63,"box":{"x":70,"y":506,"width":822,"height":11}},{"id":"cc33bc56-096f-47fc-8881-86226ad31b92","block_type":"box","text":"Fund will have contractual remedies with respect to the transaction but there can be no guarantee that the Fund will","page_number":63,"box":{"x":70,"y":521,"width":824,"height":11}},{"id":"29ad7dae-1713-4127-abea-71e470f9eb7b","block_type":"box","text":"be successful in enforcing such remedies. The market for interest rate swaps is relatively liquid in comparison with","page_number":63,"box":{"x":69,"y":536,"width":819,"height":11}},{"id":"f734c59f-557b-48b2-9156-07368ced29fd","block_type":"box","text":"other similar instruments traded in the interbank market. A Fund may be limited in its ability to enter into cer tain","page_number":63,"box":{"x":69,"y":551,"width":801,"height":11}},{"id":"a09298c4-20f8-46ca-97a3-0af563bbae60","block_type":"box","text":"interest rate derivatives due to applicable income tax requirements.","page_number":63,"box":{"x":70,"y":566,"width":480,"height":11}},{"id":"21b3b97e-25bf-4557-b00f-ee970a681401","block_type":"box","text":"Interest rate swaps are transactions in which each par ty makes periodic interest payments based on a fixed or","page_number":63,"box":{"x":102,"y":589,"width":790,"height":11}},{"id":"775d0372-684e-43fb-b9d9-598259096e21","block_type":"box","text":"variable interest rate, index or asset in return for periodic payments from its counterpar ty based on a different fixed","page_number":63,"box":{"x":68,"y":604,"width":825,"height":11}},{"id":"ecc5e570-fe3a-4777-886e-87a92227339a","block_type":"box","text":"or variable interest rate, index or asset.","page_number":63,"box":{"x":69,"y":619,"width":280,"height":11}},{"id":"b113fc71-2f40-49c7-9ef7-88f91fde782d","block_type":"box","text":"The purchase of an interest rate floor entitles the purchaser, to the extent that a specified index falls below a","page_number":63,"box":{"x":101,"y":642,"width":780,"height":11}},{"id":"ca895cff-8b14-41f4-ab40-3a6eb30ce5a3","block_type":"box","text":"predetermined interest rate, to receive payments of interest on a notional principal amount from the par ty selling","page_number":63,"box":{"x":70,"y":657,"width":805,"height":11}},{"id":"bf377199-d0ec-4033-931e-2f64d4726db6","block_type":"box","text":"such interest rate floor.","page_number":63,"box":{"x":69,"y":672,"width":165,"height":9}},{"id":"1c75ea22-19ff-4487-aca0-d9462020850c","block_type":"box","text":"The purchase of an interest rate cap entitles the purchaser, to the extent that a specified index rises above a","page_number":63,"box":{"x":101,"y":695,"width":780,"height":11}},{"id":"996292a0-97a5-4143-959e-889c0d549adf","block_type":"box","text":"predetermined interest rate, to receive payments of interest on a notional principal amount from the par ty selling","page_number":63,"box":{"x":70,"y":710,"width":805,"height":11}},{"id":"fb199798-5ef7-40b3-b920-ef965d1912b3","block_type":"box","text":"such interest rate cap.","page_number":63,"box":{"x":69,"y":725,"width":159,"height":11}},{"id":"51cd7fdd-895b-4990-a2ff-dec60255dce2","block_type":"box","text":"A Fund may enter into an interest rate swap to effectively exchange with another par ty their respective","page_number":63,"box":{"x":101,"y":748,"width":729,"height":11}},{"id":"8ab68f78-e2a5-40f6-a936-825687d22765","block_type":"box","text":"commitments to pay or receive interest,","page_number":63,"box":{"x":69,"y":763,"width":282,"height":11}},{"id":"aeb9ac7a-db38-43da-9c39-436829a6820a","block_type":"box","text":"e.g.","page_number":63,"box":{"x":359,"y":764,"width":24,"height":10}},{"id":"4590b0fb-9ef1-4252-b24f-e70a001dac6e","block_type":"box","text":", an exchange of fixed rate payments for floating rate payments. For","page_number":63,"box":{"x":386,"y":763,"width":482,"height":11}},{"id":"31f3b003-7097-4b39-960f-7215a0dc3d5e","block_type":"box","text":"example, if a Fund holds a mor tgage-backed security with an interest rate that is reset only once each year, it may","page_number":63,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"3be03999-080d-45d2-8ca4-65057ce092bf","block_type":"box","text":"swap the right to receive interest at this fixed rate for the right to receive interest at a rate that is reset every week.","page_number":63,"box":{"x":69,"y":793,"width":823,"height":11}},{"id":"9c22744f-848c-49c1-b1cc-bbcdae173f03","block_type":"box","text":"This would enable a Fund to offset a decline in the value of the mor tgage-backed security due to rising interest rates","page_number":63,"box":{"x":68,"y":808,"width":832,"height":11}},{"id":"798f4218-95b6-46a0-b3aa-fb27f65efaff","block_type":"box","text":"but would also limit its ability to benefit from falling interest rates. Conversely, if a Fund holds a mor tgage-backed","page_number":63,"box":{"x":69,"y":823,"width":807,"height":12}},{"id":"45e4dc7c-54e8-46ec-bc65-b9a9141ee799","block_type":"box","text":"security with an interest rate that is reset every week and it would like to lock in what it believes to be a high interest","page_number":63,"box":{"x":69,"y":839,"width":836,"height":11}},{"id":"c620ea29-6fe3-427f-aa69-7ee0e13a290b","block_type":"box","text":"rate for one year, it may swap the right to receive interest at this variable weekly rate for the right to receive interest","page_number":63,"box":{"x":69,"y":853,"width":826,"height":12}},{"id":"6ef49537-8bf9-49b6-bfbd-efdb4d1d6f7c","block_type":"box","text":"at a rate that is fixed for one year. Such a swap would protect the Fund from a reduction in yield due to falling interest","page_number":63,"box":{"x":69,"y":869,"width":840,"height":11}},{"id":"68f882c1-64ac-487a-adf6-6ae67b657eb0","block_type":"box","text":"rates and may permit the Fund to enhance its income through the positive differential between one week and one","page_number":63,"box":{"x":69,"y":884,"width":810,"height":11}},{"id":"ad383ab8-5556-4bac-ac1b-9f66b28c4550","block_type":"box","text":"year interest rates, but would preclude it from taking full advantage of rising interest rates.","page_number":63,"box":{"x":68,"y":899,"width":646,"height":11}},{"id":"ec06a016-f3f5-49e5-8fb0-954b82b3da2a","block_type":"box","text":"II-19","page_number":63,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"31ae77e2-c40c-4572-a52c-27d8ecc3e9ab","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":63,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"b21164e4-7c1b-4205-b72b-f7033ff13813","block_type":"box","text":"Gains from transactions in interest rate swaps distributed to shareholders will be taxable as ordinary income or,","page_number":64,"box":{"x":102,"y":45,"width":798,"height":11}},{"id":"814c3fe2-5655-432a-8e78-b49223b30318","block_type":"box","text":"in cer tain circumstances, as long term capital gains to shareholders.","page_number":64,"box":{"x":70,"y":60,"width":490,"height":11}},{"id":"7bac8723-e79a-4a9f-b22c-c85ba3bb243d","block_type":"box","text":"Interest rate swaps and interest rate caps and floors may be subject to correlation risk, leverage risk, illiquidity","page_number":64,"box":{"x":102,"y":82,"width":791,"height":12}},{"id":"e8a4ab59-97ba-443a-813a-4f22dc6d2201","block_type":"box","text":"risk and market risk. See “—Risk Factors in Derivatives” above.","page_number":64,"box":{"x":69,"y":98,"width":454,"height":9}},{"id":"0135a46b-78f6-478d-8296-502ea4d8d6b9","block_type":"box","text":"Total Return Swaps.","page_number":64,"box":{"x":103,"y":120,"width":139,"height":11}},{"id":"2d4d3c0a-c144-420d-adab-e7ec5eba8d9d","block_type":"box","text":"Total return swaps are contracts in which one par ty agrees to make periodic payments to","page_number":64,"box":{"x":249,"y":120,"width":634,"height":12}},{"id":"00c64391-3919-41fd-8b8e-85afebbf563b","block_type":"box","text":"the other par ty based on the return of the assets underlying the contract in exchange for periodic payments based on","page_number":64,"box":{"x":68,"y":135,"width":838,"height":12}},{"id":"36dd0188-e47a-43f0-b3e1-6e75f5765e1c","block_type":"box","text":"a fixed or variable interest rate or the total return from different underlying assets. The return of the assets","page_number":64,"box":{"x":69,"y":150,"width":764,"height":12}},{"id":"f916ef66-eaee-4688-88d4-a532961279c8","block_type":"box","text":"underlying the contract includes both the income generated by the asset and the change in market value of the","page_number":64,"box":{"x":69,"y":166,"width":791,"height":11}},{"id":"e1ca6ba8-c823-4538-8dc6-6dc106ef3d59","block_type":"box","text":"asset. The asset underlying the contract may include a specified security, basket of securities or securities indices.","page_number":64,"box":{"x":69,"y":181,"width":821,"height":11}},{"id":"bce5df3c-b125-41e4-bd94-9d4a3ffe5e53","block_type":"box","text":"Total return swaps on a specified security, basket of securities or securities indices may sometimes be referred to as","page_number":64,"box":{"x":68,"y":196,"width":838,"height":11}},{"id":"f231f0e9-104e-48dd-bca9-0b73537770ac","block_type":"box","text":"“contracts for difference.”","page_number":64,"box":{"x":70,"y":211,"width":184,"height":9}},{"id":"d2e8d025-f775-4118-864d-c542028427fb","block_type":"box","text":"Total return swaps may be used to obtain exposure to a security or market without owning or taking physical","page_number":64,"box":{"x":101,"y":234,"width":770,"height":11}},{"id":"00993c05-d9c5-45f6-9405-17b54b6d3231","block_type":"box","text":"custody of such security or investing directly in such market. Upon entering into a total return swap, a Fund is","page_number":64,"box":{"x":69,"y":249,"width":780,"height":11}},{"id":"b24fa646-217a-4187-b12e-1cc8d14d2f46","block_type":"box","text":"required to deposit initial margin but the par ties do not exchange the notional amount. As a result, total return swaps","page_number":64,"box":{"x":69,"y":264,"width":839,"height":11}},{"id":"047c79ff-a3f6-4f0e-bd94-92e3cafe99a9","block_type":"box","text":"may effectively add leverage to the Fund’s por tfolio because the Fund would be subject to investment exposure on","page_number":64,"box":{"x":69,"y":279,"width":816,"height":11}},{"id":"ddab6459-e122-4711-b1c6-0c39089fc1f7","block_type":"box","text":"the notional amount of the swap.","page_number":64,"box":{"x":68,"y":294,"width":235,"height":11}},{"id":"55bfafa8-bd93-4ca9-9789-833151ecdd1e","block_type":"box","text":"Total return swaps are subject to significant correlation risk, leverage risk, illiquidity risk, market risk and","page_number":64,"box":{"x":101,"y":317,"width":746,"height":11}},{"id":"c0339084-fc9a-4725-bf71-03da356e0b6c","block_type":"box","text":"counterpar ty risk. See “—Risk Factors in Derivatives” above.","page_number":64,"box":{"x":69,"y":332,"width":433,"height":11}},{"id":"7bb9ce40-8669-47af-9d49-fb15afb37744","block_type":"box","text":"Options.","page_number":64,"box":{"x":102,"y":355,"width":57,"height":11}},{"id":"bac47ee2-e8d5-4797-a5f5-cbeb1719bdf0","block_type":"box","text":"Options on Securities and Securities Indices.","page_number":64,"box":{"x":102,"y":377,"width":319,"height":11}},{"id":"49ecb265-2aa4-4fff-850b-97a8882005fe","block_type":"box","text":"A Fund may engage in transactions in options on individual","page_number":64,"box":{"x":427,"y":377,"width":418,"height":12}},{"id":"ca5276ea-3658-436e-93a4-fa3fc610c27b","block_type":"box","text":"securities, baskets of securities or securities indices, or par ticular measurements of value or rates, such as an index","page_number":64,"box":{"x":69,"y":392,"width":838,"height":11}},{"id":"4b2fbaab-875b-4c23-8e9d-27bbb5fae5d5","block_type":"box","text":"of the price of treasury securities or an index representative of shor t-term interest rates. Such investments may be","page_number":64,"box":{"x":69,"y":407,"width":820,"height":12}},{"id":"d484171c-bd56-416e-968a-aa7719d55e66","block_type":"box","text":"made on exchanges and in the OTC markets. In general, exchange-traded options have standardized exercise prices","page_number":64,"box":{"x":69,"y":423,"width":826,"height":11}},{"id":"2955429a-4abe-4821-a92c-7d35d4c842d3","block_type":"box","text":"and expiration dates and require the par ties to post margin against their obligations, and the per formance of the","page_number":64,"box":{"x":69,"y":438,"width":806,"height":11}},{"id":"852fe949-2228-430e-a32e-8e28785ccd3d","block_type":"box","text":"par ties’ obligations in connection with such options is guaranteed by the exchange or a related clearing corporation.","page_number":64,"box":{"x":70,"y":453,"width":825,"height":11}},{"id":"c6fcf8ea-e76c-43e6-a1d9-34735130f1b2","block_type":"box","text":"OTC options have more flexible terms negotiated between the buyer and the seller, but are subject to greater credit","page_number":64,"box":{"x":69,"y":468,"width":822,"height":11}},{"id":"6baf6001-6366-459e-b602-cb41607dba96","block_type":"box","text":"risk. OTC options also involve greater illiquidity risk.","page_number":64,"box":{"x":69,"y":483,"width":366,"height":11}},{"id":"9c627ea6-69a9-423c-86f4-b7515d4c446a","block_type":"box","text":"A Fund may also engage in transactions in options which have additional features that result in different","page_number":64,"box":{"x":101,"y":506,"width":743,"height":11}},{"id":"af7adc63-8af3-4a57-b308-37fa7bdd0501","block_type":"box","text":"payment structures and/or expirations (commonly referred to as exotic options). For example, barrier options are","page_number":64,"box":{"x":70,"y":521,"width":804,"height":11}},{"id":"26f719b1-9cd0-48c2-97e9-b12a7a33d0c4","block_type":"box","text":"exotic options that can only be exercised (or automatically expire) if the price of the underlying asset reaches one or","page_number":64,"box":{"x":69,"y":536,"width":827,"height":11}},{"id":"3b565367-cbec-4b63-b2b1-df09d687692a","block_type":"box","text":"more predetermined levels on or before expiration. Binary options are another example of exotic options which have","page_number":64,"box":{"x":69,"y":551,"width":827,"height":11}},{"id":"364b1fe3-18d7-4443-86c1-3e9acc707fd9","block_type":"box","text":"a fixed all-or-nothing payout if one or more predetermined conditions are met. Exotic options are typically traded in","page_number":64,"box":{"x":69,"y":566,"width":812,"height":11}},{"id":"aae86cd4-d6f1-46ca-9f01-72303ee88276","block_type":"box","text":"OTC markets.","page_number":64,"box":{"x":69,"y":581,"width":95,"height":9}},{"id":"7d377cd1-d513-4f27-bf77-dab18aa6eb72","block_type":"box","text":"There are several risks associated with transactions in options on securities and indexes. For example, there are","page_number":64,"box":{"x":101,"y":604,"width":806,"height":11}},{"id":"090f9101-6b67-45b3-a956-dfa460fe68c1","block_type":"box","text":"significant differences between the securities and options markets that could result in an imper fect correlation","page_number":64,"box":{"x":69,"y":619,"width":791,"height":11}},{"id":"262a7e9d-4bb3-4702-b1f8-b3fee86cfeb9","block_type":"box","text":"between these markets, causing a given transaction not to achieve its objectives. In addition, a liquid market for","page_number":64,"box":{"x":69,"y":634,"width":801,"height":12}},{"id":"889b8ec3-65d9-41e9-86ee-a20117507f97","block_type":"box","text":"par ticular options, whether traded OTC or on a national securities exchange (“Exchange”) may be absent for reasons","page_number":64,"box":{"x":70,"y":649,"width":831,"height":12}},{"id":"ada2c1de-5c44-4d5f-b4f5-30e11f5afda8","block_type":"box","text":"which include the following: there may be insufficient trading interest in cer tain options; restrictions may be imposed","page_number":64,"box":{"x":68,"y":664,"width":833,"height":12}},{"id":"992ec87f-b087-45f7-9c88-9ed8065c5263","block_type":"box","text":"by an Exchange on opening transactions or closing transactions or both; trading halts, suspensions or other","page_number":64,"box":{"x":69,"y":680,"width":769,"height":11}},{"id":"f59b1772-a909-4362-8971-d4b191b0bc26","block_type":"box","text":"restrictions may be imposed with respect to par ticular classes or series of options or underlying securities; unusual","page_number":64,"box":{"x":69,"y":695,"width":824,"height":11}},{"id":"aff0d8f1-028a-40b9-8c59-2643a8526077","block_type":"box","text":"or unforeseen circumstances may interrupt normal operations on an Exchange; the facilities of an Exchange or the","page_number":64,"box":{"x":69,"y":710,"width":816,"height":11}},{"id":"10506add-e216-4a96-9805-a208a2417f5e","block_type":"box","text":"Options Clearing Corporation may not at all times be adequate to handle current trading volume; or one or more","page_number":64,"box":{"x":69,"y":725,"width":796,"height":11}},{"id":"96e73889-abb4-4052-ab65-2e683db416f2","block_type":"box","text":"Exchanges could, for economic or other reasons, decide or be compelled at some future date to discontinue the","page_number":64,"box":{"x":70,"y":740,"width":798,"height":11}},{"id":"51ab2926-3cc9-4546-bce2-819dc1824585","block_type":"box","text":"trading of options (or a par ticular class or series of options), in which event the market on that Exchange (or in that","page_number":64,"box":{"x":68,"y":755,"width":822,"height":11}},{"id":"de8d5ef0-65da-4247-ae9e-1680b5892fed","block_type":"box","text":"class or series of options) would cease to exist, although outstanding options that had been issued by the Options","page_number":64,"box":{"x":69,"y":770,"width":818,"height":12}},{"id":"b2bcceae-af66-407d-b970-b1440ddab1c4","block_type":"box","text":"Clearing Corporation as a result of trades on that Exchange would continue to be exercisable in accordance with their","page_number":64,"box":{"x":69,"y":785,"width":836,"height":12}},{"id":"eaf63b3f-0cd6-437d-9d23-7d9d259b1a6d","block_type":"box","text":"terms.","page_number":64,"box":{"x":68,"y":801,"width":45,"height":9}},{"id":"fc2a2a1d-96fe-44ac-9e76-603e335a2d86","block_type":"box","text":"Each of the options exchanges has established limitations governing the maximum number of call or put options","page_number":64,"box":{"x":102,"y":823,"width":801,"height":12}},{"id":"4d4ed15a-8d39-49d8-bf32-ba29d17d83b7","block_type":"box","text":"on the same asset that may be bought or written by a single investor, whether acting alone or in concer t with others","page_number":64,"box":{"x":69,"y":839,"width":826,"height":11}},{"id":"7989d547-e9c7-4bb6-89f0-ff5a271e82df","block_type":"box","text":"(regardless of whether such options are written on the same or different exchanges or are held or written on one or","page_number":64,"box":{"x":69,"y":853,"width":823,"height":12}},{"id":"b91c8ba2-17cd-4bac-87df-ea92e2392c5a","block_type":"box","text":"more accounts or through one or more brokers). Under these limitations, option positions of all investment","page_number":64,"box":{"x":69,"y":869,"width":762,"height":11}},{"id":"ff4e7cc5-5bfb-4c91-91ff-161beab66d19","block_type":"box","text":"companies advised by the Manager are combined for purposes of these limits. Pursuant to these limitations, an","page_number":64,"box":{"x":69,"y":884,"width":798,"height":11}},{"id":"23cf2117-1929-4a9d-9b55-ffade86822cc","block_type":"box","text":"II-20","page_number":64,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"95d3fd35-2072-4488-8ae3-b2e9ff6384b1","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":64,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"d32083ba-bec7-4cf3-b527-1c437a8e0340","block_type":"box","text":"exchange may order the liquidation of positions and may impose other sanctions or restrictions. These position limits","page_number":65,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"f0216b53-38bd-41e4-a7fe-87e096392eb0","block_type":"box","text":"may restrict the number of listed options that a Fund may buy or sell.","page_number":65,"box":{"x":69,"y":60,"width":491,"height":11}},{"id":"01ea2abd-998f-4cf0-bdff-c2f1801f9966","block_type":"box","text":"Call Options.","page_number":65,"box":{"x":102,"y":83,"width":89,"height":10}},{"id":"9efdaef5-3c0b-4c02-8d48-63b545fefac2","block_type":"box","text":"A Fund may purchase call options on any of the types of securities or instruments in which it may","page_number":65,"box":{"x":197,"y":82,"width":694,"height":12}},{"id":"5b142631-98d9-411e-a04e-db1085ee0ea1","block_type":"box","text":"invest. A purchased call option gives a Fund the right to buy, and obligates the seller to sell, the underlying security at","page_number":65,"box":{"x":70,"y":98,"width":838,"height":11}},{"id":"a9062a9d-4bc8-4b52-aaa6-8e79a86b42a2","block_type":"box","text":"the exercise price at any time during the option period. A Fund also may purchase and sell call options on indices.","page_number":65,"box":{"x":68,"y":113,"width":813,"height":11}},{"id":"c9e88a7b-9a6d-4ed7-9d0b-0300bdcc89fd","block_type":"box","text":"Index options are similar to options on securities except that, rather than taking or making delivery of securities","page_number":65,"box":{"x":70,"y":128,"width":795,"height":11}},{"id":"c7ef9234-4682-4598-9b7b-ba0b91f8efbc","block_type":"box","text":"underlying the option at a specified price upon exercise, an index option gives the holder the right to receive cash","page_number":65,"box":{"x":69,"y":143,"width":807,"height":11}},{"id":"3451b1b4-83da-4d1d-8cf1-308f85b7fe7d","block_type":"box","text":"upon exercise of the option if the level of the index upon which the option is based is greater than the exercise price","page_number":65,"box":{"x":69,"y":158,"width":830,"height":11}},{"id":"67105cf4-2f38-4bcd-a4df-cd7702c821ff","block_type":"box","text":"of the option.","page_number":65,"box":{"x":69,"y":173,"width":93,"height":11}},{"id":"01f9e14e-0885-4de0-bb3c-e9b5aa3f1305","block_type":"box","text":"A written call option is covered if a Fund holds a call on the same security or index as the call written where the","page_number":65,"box":{"x":101,"y":196,"width":794,"height":11}},{"id":"c7590a75-25e4-4056-8104-9c324fd74341","block_type":"box","text":"exercise price of the call held is (i) equal to or less than the exercise price of the call written, or (ii) greater than the","page_number":65,"box":{"x":69,"y":211,"width":823,"height":11}},{"id":"3a418bb9-ca54-4f28-b3d3-fdb7b756559e","block_type":"box","text":"exercise price of the call written provided the difference is maintained by the Fund in assets which are not considered","page_number":65,"box":{"x":69,"y":226,"width":839,"height":11}},{"id":"46251d7d-11b4-4c78-9236-9820d3c2aa59","block_type":"box","text":"illiquid investments under the Funds’ Liquidity Program (as defined below) (“liquid assets”) designated on the","page_number":65,"box":{"x":70,"y":241,"width":778,"height":11}},{"id":"7983339a-eab6-4565-a98c-896c253ce761","block_type":"box","text":"Manager’s or the sub-adviser’s books and records to the extent required by Commission guidelines.","page_number":65,"box":{"x":70,"y":256,"width":711,"height":12}},{"id":"0d003917-0988-4c47-bee7-da6a48735e52","block_type":"box","text":"A Fund may write (","page_number":65,"box":{"x":101,"y":279,"width":130,"height":11}},{"id":"666c0f3f-8411-4c3c-9532-06fd55212e09","block_type":"box","text":"i.e.","page_number":65,"box":{"x":233,"y":279,"width":20,"height":9}},{"id":"c67a95a3-5c42-4d7b-b6bf-067bfb6fddce","block_type":"box","text":", sell) covered call options on the securities or instruments in which it may invest and to","page_number":65,"box":{"x":256,"y":279,"width":627,"height":11}},{"id":"8054bbb9-fb40-4786-9929-a975c9fb618b","block_type":"box","text":"enter into closing purchase transactions with respect to cer tain of such options. A covered call option is an option in","page_number":65,"box":{"x":69,"y":294,"width":831,"height":11}},{"id":"bbb320a9-287a-4a6d-a01a-d403329f2e4e","block_type":"box","text":"which a Fund, in return for a premium, gives another par ty a right to buy specified securities owned by the Fund at a","page_number":65,"box":{"x":68,"y":309,"width":827,"height":11}},{"id":"269436e6-bf52-4963-be33-c0ac147fadd9","block_type":"box","text":"specified future date and price set at the time of the contract. The principal reason for writing call options is the","page_number":65,"box":{"x":69,"y":324,"width":797,"height":12}},{"id":"420db5c9-8f38-4248-ba5d-c77edf62c91c","block_type":"box","text":"attempt to realize, through the receipt of premiums, a greater return than would be realized on the securities alone.","page_number":65,"box":{"x":69,"y":339,"width":823,"height":12}},{"id":"40c0f901-861c-4b06-aa6b-2fd602466c2b","block_type":"box","text":"By writing covered call options, a Fund gives up the oppor tunity, while the option is in effect, to profit from any price","page_number":65,"box":{"x":70,"y":355,"width":823,"height":11}},{"id":"3e8082f9-9928-4840-8fa7-3e49ebc18043","block_type":"box","text":"increase in the underlying security above the option exercise price. In addition, a Fund’s ability to sell the underlying","page_number":65,"box":{"x":70,"y":370,"width":825,"height":11}},{"id":"0f9cd7b3-d37d-400b-8ccb-f02ad4fbfb4b","block_type":"box","text":"security will be limited while the option is in effect unless the Fund enters into a closing purchase transaction. A","page_number":65,"box":{"x":69,"y":385,"width":800,"height":11}},{"id":"efa28264-725c-475a-a582-ef5a9caf325d","block_type":"box","text":"closing purchase transaction cancels out a Fund’s position as the writer of an option by means of an offsetting","page_number":65,"box":{"x":69,"y":400,"width":792,"height":11}},{"id":"34a7bc3b-158f-4d8b-84a0-d2e956b43826","block_type":"box","text":"purchase of an identical option prior to the expiration of the option it has written. Covered call options also serve as","page_number":65,"box":{"x":70,"y":415,"width":826,"height":11}},{"id":"d93c4d6a-7292-43af-9a4f-5606a734589d","block_type":"box","text":"a par tial hedge to the extent of the premium received against the price of the underlying security declining.","page_number":65,"box":{"x":69,"y":430,"width":760,"height":11}},{"id":"116768b3-7b47-4a08-aade-5bd1276d51b4","block_type":"box","text":"A Fund may write","page_number":65,"box":{"x":101,"y":453,"width":120,"height":11}},{"id":"a5c9b7bf-bcca-4be9-997c-7cbcda5d71d2","block_type":"box","text":"(i.e.","page_number":65,"box":{"x":228,"y":453,"width":25,"height":11}},{"id":"9292da06-bbfa-43f8-8606-051daf0020b0","block_type":"box","text":", sell) uncovered call options on securities or instruments in which it may invest but that","page_number":65,"box":{"x":256,"y":453,"width":628,"height":11}},{"id":"c4f5f6bb-72a2-45b2-9d2e-3e2cd5428290","block_type":"box","text":"are not currently held by the Fund. The principal reason for writing uncovered call options is to realize income without","page_number":65,"box":{"x":69,"y":468,"width":834,"height":11}},{"id":"32846ef7-06ed-40fc-88cf-942facc08f23","block_type":"box","text":"committing capital to the ownership of the underlying securities or instruments. When writing uncovered call options,","page_number":65,"box":{"x":69,"y":483,"width":830,"height":11}},{"id":"48ef9be4-cb4a-4b73-a2b0-6f0aa7bdf2ca","block_type":"box","text":"a Fund must deposit and maintain sufficient margin with the broker-dealer through which it made the uncovered call","page_number":65,"box":{"x":69,"y":498,"width":825,"height":11}},{"id":"230fe1cf-552e-4bbe-a1bf-36561c75d1e1","block_type":"box","text":"option as collateral to ensure that the securities can be purchased for delivery if and when the option is exercised.","page_number":65,"box":{"x":69,"y":513,"width":818,"height":11}},{"id":"cc96b307-7848-4f04-ab07-a20027a545bc","block_type":"box","text":"During periods of declining securities prices or when prices are stable, writing uncovered calls can be a profitable","page_number":65,"box":{"x":70,"y":528,"width":806,"height":12}},{"id":"cb6d3233-b2a5-48d4-a87d-27c2bcfe12d1","block_type":"box","text":"strategy to increase a Fund’s income with minimal capital risk. Uncovered calls are riskier than covered calls because","page_number":65,"box":{"x":69,"y":544,"width":839,"height":11}},{"id":"14074d01-f98e-463b-9432-3a2044211d55","block_type":"box","text":"there is no underlying security held by a Fund that can act as a par tial hedge. Uncovered calls have speculative","page_number":65,"box":{"x":68,"y":559,"width":793,"height":11}},{"id":"e6acd427-8846-41f8-9191-401dd742e2d6","block_type":"box","text":"characteristics and the potential for loss is unlimited. When an uncovered call is exercised, a Fund must purchase","page_number":65,"box":{"x":69,"y":574,"width":814,"height":11}},{"id":"6cce44b2-2d7f-4972-b4c5-f9af9ddf8b53","block_type":"box","text":"the underlying security to meet its call obligation. There is also a risk, especially with preferred and debt securities","page_number":65,"box":{"x":68,"y":589,"width":818,"height":11}},{"id":"4edf94d9-4961-405e-89c0-0b11dda28f8c","block_type":"box","text":"that lack sufficient liquidity, that the securities may not be available for purchase. If the purchase price exceeds the","page_number":65,"box":{"x":68,"y":604,"width":825,"height":11}},{"id":"ebe0fa2b-bcf3-40e0-9de7-047dfd30a50d","block_type":"box","text":"exercise price, a Fund will lose the difference.","page_number":65,"box":{"x":69,"y":619,"width":326,"height":11}},{"id":"b47d0ab6-f3dc-43aa-be03-25d6813e84d9","block_type":"box","text":"Put Options.","page_number":65,"box":{"x":102,"y":642,"width":85,"height":11}},{"id":"2556ce97-3eba-48f4-804c-02271a715409","block_type":"box","text":"A Fund may purchase put options to seek to hedge against a decline in the value of its securities or","page_number":65,"box":{"x":194,"y":642,"width":712,"height":11}},{"id":"9be50aab-314c-4a2a-97a4-b472fba6e2e7","block_type":"box","text":"to enhance its return. By buying a put option, a Fund acquires a right to sell the underlying securities or instruments","page_number":65,"box":{"x":68,"y":657,"width":828,"height":11}},{"id":"2e99d493-63f6-4991-8c6f-80de1996017f","block_type":"box","text":"at the exercise price, thus limiting the Fund’s risk of loss through a decline in the market value of the securities or","page_number":65,"box":{"x":69,"y":672,"width":816,"height":11}},{"id":"09ee9757-13ce-48ea-b84a-60a9770f90b6","block_type":"box","text":"instruments until the put option expires. The amount of any appreciation in the value of the underlying securities or","page_number":65,"box":{"x":70,"y":687,"width":820,"height":11}},{"id":"d65ec05b-4634-44b6-872c-e1dbd1fc9309","block_type":"box","text":"instruments will be par tially offset by the amount of the premium paid for the put option and any related transaction","page_number":65,"box":{"x":70,"y":702,"width":826,"height":11}},{"id":"9fc7b780-ef07-4d1c-8026-8d18a344e98a","block_type":"box","text":"costs. Prior to its expiration, a put option may be sold in a closing sale transaction and profit or loss from the sale","page_number":65,"box":{"x":69,"y":717,"width":815,"height":12}},{"id":"ccf17297-206a-4b49-967d-2e5f32f681cb","block_type":"box","text":"will depend on whether the amount received is more or less than the premium paid for the put option plus the related","page_number":65,"box":{"x":68,"y":732,"width":839,"height":11}},{"id":"1ffdd739-0245-4c4b-88b9-5ec516b3d397","block_type":"box","text":"transaction costs. A closing sale transaction cancels out a Fund’s position as the purchaser of an option by means of","page_number":65,"box":{"x":68,"y":748,"width":841,"height":11}},{"id":"c46c6409-39e2-4f7f-819c-d5f47a3d68ca","block_type":"box","text":"an offsetting sale of an identical option prior to the expiration of the option it has purchased. A Fund also may","page_number":65,"box":{"x":69,"y":763,"width":785,"height":11}},{"id":"08a62bc5-50e9-4f7c-82c8-0737a21f8c5d","block_type":"box","text":"purchase uncovered put options.","page_number":65,"box":{"x":70,"y":778,"width":231,"height":11}},{"id":"49706484-5b7b-451c-b86d-37d8cdab5347","block_type":"box","text":"A Fund also may write (","page_number":65,"box":{"x":101,"y":801,"width":165,"height":11}},{"id":"8b8af285-133a-4874-8058-d8fa755ed69f","block_type":"box","text":"i.e.","page_number":65,"box":{"x":268,"y":801,"width":20,"height":9}},{"id":"237fd41c-2f01-45fa-a0d2-7b03dc6729c3","block_type":"box","text":", sell) put options on the types of securities or instruments that may be held by the","page_number":65,"box":{"x":291,"y":801,"width":591,"height":11}},{"id":"fe8f5263-41e1-434f-8d7c-b5f73b5c408c","block_type":"box","text":"Fund. A Fund will receive a premium for writing a put option, which increases the Fund’s return.","page_number":65,"box":{"x":70,"y":816,"width":675,"height":11}},{"id":"932277af-6592-465d-8b31-6737ce1fd2c3","block_type":"box","text":"A Fund also may write (","page_number":65,"box":{"x":101,"y":839,"width":165,"height":10}},{"id":"f331fc00-ceff-4a7c-873b-486f24b04af2","block_type":"box","text":"i.e.","page_number":65,"box":{"x":268,"y":839,"width":20,"height":8}},{"id":"c9f815f5-43d7-4919-acb5-f34e0c4e4833","block_type":"box","text":", sell) uncovered put options on securities or instruments in which it may invest but","page_number":65,"box":{"x":291,"y":839,"width":593,"height":10}},{"id":"8fa4a15d-abcc-430f-9508-6db5af307ace","block_type":"box","text":"with respect to which the Fund does not currently have a corresponding shor t position or has not deposited as","page_number":65,"box":{"x":68,"y":854,"width":789,"height":11}},{"id":"39ff23c7-8fe7-4d7a-a82d-9e5ef225fd55","block_type":"box","text":"collateral cash equal to the exercise value of the put option with the broker-dealer through which it made the","page_number":65,"box":{"x":69,"y":869,"width":773,"height":11}},{"id":"09f8fbf3-2750-4a91-96b2-5fe8dad76530","block_type":"box","text":"uncovered put option. The principal reason for writing uncovered put options is to receive premium income and to","page_number":65,"box":{"x":69,"y":884,"width":807,"height":11}},{"id":"89b088fa-3149-4d35-b14e-7207f336c7b1","block_type":"box","text":"acquire such securities or instruments at a net cost below the current market value. A Fund has the obligation to buy","page_number":65,"box":{"x":69,"y":899,"width":835,"height":11}},{"id":"95c0164c-c25b-4a5a-aaf9-a96519a1a2ff","block_type":"box","text":"II-21","page_number":65,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"994233c2-5ca5-452c-9824-8ddd3126fdf5","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":65,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"60509cac-bd74-4d78-a481-98874212adbc","block_type":"box","text":"the securities or instruments at an agreed upon price if the price of the securities or instruments decreases below","page_number":66,"box":{"x":68,"y":45,"width":818,"height":11}},{"id":"2da84bbe-2bf8-4e83-9d0d-5186661dfda8","block_type":"box","text":"the exercise price. If the price of the securities or instruments increases during the option period, the option will","page_number":66,"box":{"x":68,"y":60,"width":800,"height":11}},{"id":"ccf3a279-e672-4dfe-b9b8-936186965e71","block_type":"box","text":"expire wor thless and a Fund will retain the premium and will not have to purchase the securities or instruments at","page_number":66,"box":{"x":69,"y":75,"width":814,"height":11}},{"id":"50eddfd0-c280-4718-bbc6-3cbd61d72ee3","block_type":"box","text":"the exercise price.","page_number":66,"box":{"x":68,"y":90,"width":130,"height":11}},{"id":"feb9f750-bf03-402a-abc9-0b380b285af1","block_type":"box","text":"Options on Government National Mor tgage Association (“GNMA”) Cer tificates.","page_number":66,"box":{"x":102,"y":113,"width":556,"height":11}},{"id":"d68ef7e0-dc0d-443f-a925-453df666e2a7","block_type":"box","text":"The following information relates","page_number":66,"box":{"x":664,"y":113,"width":232,"height":11}},{"id":"022929d0-8e47-4db5-bd91-b0c5e8ad36d9","block_type":"box","text":"to the unique characteristics of options on GNMA Cer tificates. Since the remaining principal balance of GNMA","page_number":66,"box":{"x":68,"y":128,"width":784,"height":11}},{"id":"e8ddb456-f0a2-47ea-ab61-64b769fae2eb","block_type":"box","text":"Cer tificates declines each month as a result of mor tgage payments, a Fund, as a writer of a GNMA call holding GNMA","page_number":66,"box":{"x":69,"y":143,"width":840,"height":11}},{"id":"1f575c8c-0e5d-480c-98df-f63a1158bc44","block_type":"box","text":"Cer tificates as “cover” to satisfy its delivery obligation in the event of exercise, may find that the GNMA Cer tificates","page_number":66,"box":{"x":69,"y":158,"width":827,"height":11}},{"id":"8247468b-25fd-47d0-a51a-9d0aded8da4c","block_type":"box","text":"it holds no longer have a sufficient remaining principal balance for this purpose. Should this occur, a Fund will","page_number":66,"box":{"x":70,"y":173,"width":781,"height":11}},{"id":"464d14c3-e1d2-42b6-9434-2f6465818538","block_type":"box","text":"purchase additional GNMA Cer tificates from the same pool (if obtainable) or other GNMA Cer tificates in the cash","page_number":66,"box":{"x":70,"y":188,"width":803,"height":11}},{"id":"63cd5a2a-3ebd-4ac3-a02f-ab93d3ddee8f","block_type":"box","text":"market in order to maintain its “cover.”","page_number":66,"box":{"x":69,"y":204,"width":277,"height":8}},{"id":"2d50a6cc-0355-4d48-9108-684a326cbb7e","block_type":"box","text":"A GNMA Cer tificate held by a Fund to cover an option position in any but the nearest expiration month may cease","page_number":66,"box":{"x":101,"y":226,"width":807,"height":11}},{"id":"80dbe273-9152-4664-bb77-0cbd8fc9cd0d","block_type":"box","text":"to represent cover for the option in the event of a decline in the GNMA coupon rate at which new pools are originated","page_number":66,"box":{"x":68,"y":241,"width":835,"height":11}},{"id":"b31b65cb-31b1-48b9-ab5c-c111008adfe8","block_type":"box","text":"under the FHA/VA loan ceiling in effect at any given time. If this should occur, a Fund will no longer be covered, and","page_number":66,"box":{"x":69,"y":256,"width":821,"height":12}},{"id":"27b39ed8-7b4e-4b5a-ae81-77f3f6575695","block_type":"box","text":"the Fund will either enter into a closing purchase transaction or replace such Cer tificate with a cer tificate that","page_number":66,"box":{"x":68,"y":271,"width":784,"height":12}},{"id":"360542bd-51e5-4cf9-a114-cae60f9f97be","block_type":"box","text":"represents cover. When a Fund closes its position or replaces such Cer tificate, it may realize an unanticipated loss","page_number":66,"box":{"x":69,"y":286,"width":820,"height":12}},{"id":"786c6c49-8ae6-4951-84e4-97733e6863f3","block_type":"box","text":"and incur transaction costs.","page_number":66,"box":{"x":69,"y":302,"width":197,"height":9}},{"id":"714d0589-c58f-43a5-a31d-788acff2401e","block_type":"box","text":"Options on Swaps (“Swaptions”).","page_number":66,"box":{"x":102,"y":324,"width":235,"height":11}},{"id":"3c9d859e-64e4-4947-97fa-7b0fdd7d4cae","block_type":"box","text":"A swaption gives a counterpar ty the option (but not the obligation) to enter into","page_number":66,"box":{"x":343,"y":325,"width":563,"height":11}},{"id":"15b3fc85-f771-4034-bbd7-1c0f10eae822","block_type":"box","text":"a new swap agreement or to shor ten, extend, cancel or otherwise modify an existing swap agreement, at a","page_number":66,"box":{"x":69,"y":339,"width":763,"height":12}},{"id":"eba1dd01-f8cb-4eac-a127-e1bd5ce15b73","block_type":"box","text":"designated future time on specified terms. A Fund may write (","page_number":66,"box":{"x":69,"y":355,"width":439,"height":11}},{"id":"0b173ce7-d367-4130-beae-0f2a454c022c","block_type":"box","text":"i.e.","page_number":66,"box":{"x":510,"y":355,"width":20,"height":9}},{"id":"946cddf8-4a17-4e17-baa4-7ce9d83d7627","block_type":"box","text":", sell) and purchase put and call swaptions.","page_number":66,"box":{"x":533,"y":355,"width":309,"height":11}},{"id":"1812aae0-1561-48ca-8fe0-ed8d7dd9629c","block_type":"box","text":"Depending on the terms of the par ticular option agreement, a Fund will generally incur a greater degree of risk when","page_number":66,"box":{"x":70,"y":370,"width":826,"height":11}},{"id":"c145d164-396e-465a-a9b5-ceb670a6a2e8","block_type":"box","text":"it writes a swaption than it will incur when it purchases a swaption. When a Fund purchases a swaption, it risks","page_number":66,"box":{"x":70,"y":385,"width":793,"height":11}},{"id":"8ba23ccd-42cb-4b52-a37a-80762789551e","block_type":"box","text":"losing only the amount of the premium it has paid should it decide to let the option expire unexercised. However,","page_number":66,"box":{"x":70,"y":400,"width":802,"height":11}},{"id":"f5e7b4d6-b166-40ed-a71b-01e20304b899","block_type":"box","text":"when a Fund writes a swaption, upon exercise of the option the Fund will become obligated according to the terms of","page_number":66,"box":{"x":68,"y":415,"width":836,"height":11}},{"id":"a2312f7c-c9d6-425d-9214-8f9cd13bd261","block_type":"box","text":"the underlying agreement and the potential for loss may be unlimited. Cer tain swaptions are permitted, although not","page_number":66,"box":{"x":68,"y":430,"width":832,"height":11}},{"id":"916e477e-bd13-44c7-a7c8-ba3fdbd56f14","block_type":"box","text":"required, to be cleared.","page_number":66,"box":{"x":69,"y":446,"width":165,"height":10}},{"id":"6270309d-09ee-43f6-93b9-7eb4c7fcb890","block_type":"box","text":"A Fund will likely enter into these transactions to preserve a return or spread on a par ticular investment or","page_number":66,"box":{"x":101,"y":468,"width":760,"height":11}},{"id":"d0982fb8-25d9-46d4-90c7-4da136ece09b","block_type":"box","text":"por tion of its por tfolio or to protect against any increase in the price of securities the Fund anticipates purchasing at","page_number":66,"box":{"x":70,"y":483,"width":830,"height":11}},{"id":"eaa21b07-f16b-4b18-9059-854afc4e9d4d","block_type":"box","text":"a later date. A Fund generally will use these transactions for hedging purposes, not for speculation.","page_number":66,"box":{"x":69,"y":498,"width":706,"height":11}},{"id":"7d0303b0-e585-4e84-8c3e-380015d21d55","block_type":"box","text":"Swaptions may be subject to correlation risk, leverage risk, illiquidity risk and market risk. See “—Risk Factors in","page_number":66,"box":{"x":102,"y":521,"width":805,"height":11}},{"id":"0911585d-299d-482f-bd64-1d0c1013e078","block_type":"box","text":"Derivatives” above.","page_number":66,"box":{"x":70,"y":536,"width":135,"height":9}},{"id":"9f73009a-9141-415c-8e77-d5328edbfbc8","block_type":"box","text":"FLEX Options.","page_number":66,"box":{"x":102,"y":559,"width":96,"height":11}},{"id":"16c137d5-cb72-44a0-ad4d-c3434a44d270","block_type":"box","text":"FLEX Options are customized option contracts available through national securities exchanges that","page_number":66,"box":{"x":206,"y":559,"width":702,"height":11}},{"id":"c22dd85c-7748-4991-afdb-3f6dd25bb7f4","block_type":"box","text":"are guaranteed for settlement by the Options Clearing Corporation (“OCC”). FLEX Options are listed on a U.S. national","page_number":66,"box":{"x":69,"y":574,"width":839,"height":11}},{"id":"ec961ad9-755b-40e5-8a88-6b87682a61c9","block_type":"box","text":"securities exchange. FLEX Options provide investors with the ability to customize assets referenced by the options,","page_number":66,"box":{"x":69,"y":589,"width":818,"height":11}},{"id":"44b4c173-4ab4-45ba-9db6-3a2ffeba5ac0","block_type":"box","text":"exercise prices, exercise styles (","page_number":66,"box":{"x":69,"y":604,"width":231,"height":11}},{"id":"5a3811e3-ec39-4579-b663-c8edf0e65242","block_type":"box","text":"i.e.","page_number":66,"box":{"x":302,"y":604,"width":20,"height":9}},{"id":"d06d8d40-863e-4a38-9d03-fd5a73a57fe9","block_type":"box","text":", American-style, exercisable any time prior to the expiration date, or European","page_number":66,"box":{"x":325,"y":604,"width":561,"height":11}},{"id":"a8f64481-2001-4bf2-bf81-871cbbebb1ff","block_type":"box","text":"style, exercisable only on the option expiration date) and expiration dates, while achieving price discovery in","page_number":66,"box":{"x":69,"y":619,"width":768,"height":11}},{"id":"5cc3e870-a33a-4a30-ba84-fdd80e112300","block_type":"box","text":"competitive, transparent auctions markets and avoiding the counterpar ty exposure of OTC options positions. Each","page_number":66,"box":{"x":69,"y":634,"width":812,"height":12}},{"id":"0393d209-6d84-44e5-b939-ba47bf8cc972","block_type":"box","text":"option contract entitles the holder thereof to purchase (for the call options) or sell (for the put options) shares of the","page_number":66,"box":{"x":69,"y":649,"width":830,"height":11}},{"id":"7bf09243-e4a3-4736-8804-4a6e280bdbf5","block_type":"box","text":"reference asset at the strike price. A Fund’s por tfolio may include several types of FLEX Options, including both","page_number":66,"box":{"x":69,"y":664,"width":792,"height":12}},{"id":"0697dec1-fb6b-4e01-8c97-f1daca0bfb5d","block_type":"box","text":"purchased and written put and call options (as fur ther described below). The FLEX Options are all European style","page_number":66,"box":{"x":70,"y":680,"width":802,"height":11}},{"id":"44c2bcce-b73d-4e6d-b440-88a4d0e0d3dc","block_type":"box","text":"options, which means that they are exercisable at a predetermined specified price (the “strike price”) only on the","page_number":66,"box":{"x":69,"y":695,"width":806,"height":11}},{"id":"404d88a0-68cf-44bf-9e6e-b4b60b694d5a","block_type":"box","text":"FLEX Option’s expiration date.","page_number":66,"box":{"x":70,"y":710,"width":211,"height":11}},{"id":"10176b4a-1226-47c5-ab46-fcf34cdcfcc7","block_type":"box","text":"The OCC guarantees per formance by each of the counterpar ties to the FLEX Options, becoming the “buyer for","page_number":66,"box":{"x":101,"y":732,"width":783,"height":12}},{"id":"7d1e3b5a-8540-46cf-bc2a-49ba46e5a7c8","block_type":"box","text":"every seller and the seller for every buyer”, reducing counterpar ty risk for clearing members and options traders.","page_number":66,"box":{"x":69,"y":748,"width":802,"height":11}},{"id":"b906b9e3-473a-4850-ab05-f59871e0d530","block_type":"box","text":"Although guaranteed for settlement by the OCC, FLEX Options are still subject to counterpar ty risk with the OCC and","page_number":66,"box":{"x":68,"y":763,"width":826,"height":11}},{"id":"a6dc41bd-27f4-4db5-91e9-5cdf1731cabf","block_type":"box","text":"subject to the risk that the OCC may fail to per form the settlement of the FLEX Options due to bankruptcy or other","page_number":66,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"60519d70-df47-489d-af48-b3e793cb16cd","block_type":"box","text":"adverse reasons. A Fund bears the risk that the OCC will be unable or unwilling to per form its obligations under the","page_number":66,"box":{"x":69,"y":793,"width":822,"height":11}},{"id":"6f2f7519-826f-4492-a128-d731f580ee41","block_type":"box","text":"FLEX Options contracts.","page_number":66,"box":{"x":70,"y":808,"width":166,"height":11}},{"id":"9f44f195-e24e-4b84-90ac-8c92eacf897a","block_type":"box","text":"Subject to determination by the Securities Committee of the OCC, adjustments may be made to the FLEX","page_number":66,"box":{"x":102,"y":831,"width":748,"height":11}},{"id":"bb00a4f0-1b2d-48e7-9052-d5fdb1efc80c","block_type":"box","text":"Options for cer tain events (collectively, “Corporate Actions”) specified in the OCC’s by-laws and rules: cer tain stock","page_number":66,"box":{"x":69,"y":846,"width":822,"height":11}},{"id":"ebcaed91-0494-4664-96b1-ce77c6c7505b","block_type":"box","text":"dividends or distributions, stock splits, reverse stock splits, rights offerings, distributions, reorganizations,","page_number":66,"box":{"x":69,"y":861,"width":759,"height":11}},{"id":"5ed0d77e-3c9e-4924-8ec8-c9e9b479b393","block_type":"box","text":"recapitalizations, or reclassifications with respect to an underlying security, or a merger, consolidation, dissolution or","page_number":66,"box":{"x":69,"y":876,"width":833,"height":11}},{"id":"148546e0-c4ed-4385-b66b-277bf77b5128","block_type":"box","text":"liquidation of the issuer of the underlying security. According to the OCC’s by-laws, the nature and extent of any such","page_number":66,"box":{"x":70,"y":891,"width":829,"height":12}},{"id":"6b4054cb-5e53-42e3-a2cf-282c3a0b6b81","block_type":"box","text":"adjustment is to be determined by the OCC’s Securities Committee, in light of the circumstances known to it at the","page_number":66,"box":{"x":69,"y":906,"width":821,"height":12}},{"id":"92760034-3c27-4815-8f0a-6949db210999","block_type":"box","text":"II-22","page_number":66,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"b5aec1b7-39b0-4a94-97ba-4e9e34a38bea","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":66,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"b2517369-2321-4e56-9c8b-0250c1e57a91","block_type":"box","text":"time such determination is made, based on its judgment as to what is appropriate for the protection of investors and","page_number":67,"box":{"x":68,"y":45,"width":835,"height":11}},{"id":"6ec75492-fbd1-49dc-a02b-b69956849c29","block_type":"box","text":"the public interest, taking into account such factors as fairness to holders and writers (or purchasers and sellers) of","page_number":67,"box":{"x":68,"y":60,"width":829,"height":11}},{"id":"e9cef723-9383-4cb6-a1f7-fefc280b7e96","block_type":"box","text":"the affected options, the maintenance of a fair and orderly market in the affected options, consistency of","page_number":67,"box":{"x":68,"y":75,"width":753,"height":11}},{"id":"99a78152-dc4b-4532-984d-3395471bc93c","block_type":"box","text":"interpretation and practice, efficiency of exercise settlement procedures, and the coordination with other clearing","page_number":67,"box":{"x":70,"y":90,"width":806,"height":11}},{"id":"6cbfb182-6ef8-4124-9759-98e553191748","block_type":"box","text":"agencies of the clearance and settlement of transactions in the underlying interest.","page_number":67,"box":{"x":69,"y":105,"width":593,"height":11}},{"id":"19d4e841-3a3b-46c8-bbab-d94d25cff413","block_type":"box","text":"Cer tain Considerations Regarding Options","page_number":67,"box":{"x":135,"y":128,"width":298,"height":11}},{"id":"058e4c1c-9256-495c-9212-1c6bfa34c5bf","block_type":"box","text":". The FLEX Options in which each Fund may invest will be options","page_number":67,"box":{"x":435,"y":128,"width":461,"height":11}},{"id":"5fac2c8b-d272-4975-906b-9947523c397e","block_type":"box","text":"on an exchange-traded fund (“ETF”) or the S&P 500 Index (together with such ETF, a “Reference Asset”). As","page_number":67,"box":{"x":102,"y":143,"width":768,"height":11}},{"id":"f3219bc5-b364-4fbd-97cc-c7f01ed6f03a","block_type":"box","text":"such, the value of a Fund’s FLEX Options will fluctuate with changes in the value of the securities held by the","page_number":67,"box":{"x":102,"y":158,"width":775,"height":11}},{"id":"7dd2bdee-4616-4f14-b854-e17950488d92","block_type":"box","text":"ETF, and thus the ETF’s share price. In addition to the value of the ETF, the value of an option, in general, will","page_number":67,"box":{"x":102,"y":173,"width":777,"height":11}},{"id":"6510ff24-4af7-41da-866a-a5d5d95a89bc","block_type":"box","text":"reflect, among other things, the time remaining until expiration (the end of the Outcome Period), the relationship","page_number":67,"box":{"x":102,"y":188,"width":799,"height":12}},{"id":"56ad2999-c533-4e8e-83aa-c49d93eaf579","block_type":"box","text":"of the exercise price to the market price of the Reference Asset, and general market conditions. Options that","page_number":67,"box":{"x":102,"y":203,"width":777,"height":12}},{"id":"f8e1c855-ea11-40ba-9c96-c2a277a1ee50","block_type":"box","text":"expire unexercised have no value.","page_number":67,"box":{"x":101,"y":219,"width":240,"height":10}},{"id":"c9c162de-041c-407a-82b7-90055de99fec","block_type":"box","text":"The puts and calls on the Reference Asset entitle the purchaser of the option the right to purchase (for a","page_number":67,"box":{"x":134,"y":241,"width":747,"height":11}},{"id":"9e4d49b4-f6c3-4b42-92ec-1c34921a7a0b","block_type":"box","text":"call option) or sell (for a put option) the Reference Asset at a predetermined specified price (the “strike price”).","page_number":67,"box":{"x":101,"y":256,"width":792,"height":11}},{"id":"c3bd0e99-c734-42e0-8208-d6b8cf516417","block_type":"box","text":"When a Fund writes a call on the Reference Asset, it receives a premium and agrees that the purchaser of the","page_number":67,"box":{"x":101,"y":271,"width":786,"height":12}},{"id":"ace79d58-30dd-4336-8c90-67c0a0831c3b","block_type":"box","text":"call, upon exercise of the call, will receive from the Fund the delivery of a specified number of shares of the ETF","page_number":67,"box":{"x":101,"y":286,"width":798,"height":12}},{"id":"311f07e7-70cb-42b3-b8dd-0373464a64d1","block_type":"box","text":"in exchange for the strike price. When a Fund buys a call on the Reference Asset, it pays a premium and has the","page_number":67,"box":{"x":102,"y":302,"width":802,"height":11}},{"id":"ea3770db-2495-49dd-bf10-92ea6b07dfdb","block_type":"box","text":"same rights to such call as indicated above. When a Fund buys a put on the Reference Asset, it pays a premium","page_number":67,"box":{"x":102,"y":317,"width":800,"height":11}},{"id":"48b9e791-5fcd-452d-a16d-61f0f5af0ccd","block_type":"box","text":"and has the right to require the seller of the put, upon the Fund’s exercise of the put, to deliver the specified","page_number":67,"box":{"x":102,"y":332,"width":774,"height":11}},{"id":"15714475-6708-4066-87f3-ef1963ac7dd7","block_type":"box","text":"number of shares of the ETF in exchange for the strike price. When a Fund writes a put on the Reference Asset,","page_number":67,"box":{"x":102,"y":347,"width":793,"height":11}},{"id":"1a2f1034-f51a-4f24-b913-ba6e942d24a8","block_type":"box","text":"it receives a premium and the purchaser of the put has the right to require the Fund to deliver the specified","page_number":67,"box":{"x":102,"y":362,"width":764,"height":11}},{"id":"22a3a297-0833-4e35-813b-f0768154811d","block_type":"box","text":"number of shares of the ETF in exchange for the strike price.","page_number":67,"box":{"x":102,"y":377,"width":430,"height":12}},{"id":"41c96426-7000-4af7-ba66-791ace3c368c","block_type":"box","text":"Although each Fund will generally utilize FLEX Options that are physically settled, a Fund may also utilize","page_number":67,"box":{"x":134,"y":400,"width":740,"height":11}},{"id":"d8db5995-50b6-48bd-a9d1-470c838b7996","block_type":"box","text":"FLEX Options that are cash-settled. Cash-settled options give the holder the right to receive an amount (or owe","page_number":67,"box":{"x":102,"y":415,"width":787,"height":11}},{"id":"fe2a0d50-9e87-4a66-a290-bb1f7889ed9a","block_type":"box","text":"an amount) of cash upon the exercise of the option. Gain or loss depends on changes in the value of the ETF’s","page_number":67,"box":{"x":102,"y":430,"width":790,"height":11}},{"id":"79551a52-bf19-485e-900c-67261f577001","block_type":"box","text":"share price relative to the strike price for a given option contract. The amount of cash is equal to the difference","page_number":67,"box":{"x":102,"y":445,"width":793,"height":12}},{"id":"cb4393ec-8aa9-4024-bdab-f9b8925c331e","block_type":"box","text":"between the closing price of the ETF’s share price and the exercise price of the option contract times a specified","page_number":67,"box":{"x":102,"y":460,"width":802,"height":12}},{"id":"13a28522-af01-46f0-abeb-4b0a43424319","block_type":"box","text":"multiple (“multiplier”), which determines the total value for each point of such difference.","page_number":67,"box":{"x":102,"y":475,"width":635,"height":12}},{"id":"c41c2aea-fec0-4b57-a38f-a6f0f3e92c1f","block_type":"box","text":"Risks of Options on the Reference Assets","page_number":67,"box":{"x":135,"y":498,"width":297,"height":11}},{"id":"f5926a94-99a8-42e9-8494-9b4f3994480c","block_type":"box","text":". If a Fund has purchased an option and exercises it before the","page_number":67,"box":{"x":433,"y":498,"width":448,"height":11}},{"id":"b44c8700-faa5-4e29-9836-f91f945a5f3a","block_type":"box","text":"closing value for that day is available, it runs the risk that the level of the Reference Asset may subsequently","page_number":67,"box":{"x":101,"y":513,"width":777,"height":12}},{"id":"b7a63d56-c88c-4eac-9e75-8bbf4b751f63","block_type":"box","text":"change. If such a change causes the exercised option to fall out of the money, the applicable Fund will be","page_number":67,"box":{"x":101,"y":528,"width":753,"height":12}},{"id":"c1293985-7848-47d4-931c-b28bd28303f5","block_type":"box","text":"required to pay the difference between the closing Reference Asset value and the exercise price of the option","page_number":67,"box":{"x":102,"y":543,"width":780,"height":12}},{"id":"420ecb0f-0546-47c5-b16b-a0ab0ec5b5d1","block_type":"box","text":"(times the applicable multiplier) to the assigned writer.","page_number":67,"box":{"x":102,"y":559,"width":387,"height":11}},{"id":"f7c7e744-dd58-473a-8e02-26c45cf7ccc7","block_type":"box","text":"Foreign Exchange Transactions.","page_number":67,"box":{"x":102,"y":582,"width":222,"height":11}},{"id":"4645ff12-b75e-44b8-b083-3aeed90fd127","block_type":"box","text":"A Fund may enter into spot foreign exchange transactions, forward foreign exchange transactions (“FX forwards”)","page_number":67,"box":{"x":101,"y":604,"width":807,"height":11}},{"id":"1bb7213b-0056-45a1-b9a8-2405254b8059","block_type":"box","text":"and currency swaps, purchase and sell currency options, currency futures and related options thereon (collectively,","page_number":67,"box":{"x":69,"y":619,"width":818,"height":11}},{"id":"90407d34-a2a4-4fb8-a8ae-ba990602fd63","block_type":"box","text":"“Currency Instruments”) for purposes of hedging against the decline in the value of currencies in which its por tfolio","page_number":67,"box":{"x":70,"y":634,"width":821,"height":12}},{"id":"196da0b3-fe93-4863-92ab-23d52a06af8c","block_type":"box","text":"holdings are denominated against the U.S. dollar or, with respect to cer tain Funds, to seek to enhance returns.","page_number":67,"box":{"x":69,"y":649,"width":792,"height":12}},{"id":"42eb7204-0139-4ce6-aa27-d55e0321dfe2","block_type":"box","text":"Such transactions could be effected to hedge with respect to foreign dollar denominated securities owned by a","page_number":67,"box":{"x":102,"y":672,"width":790,"height":11}},{"id":"a3c059b7-6c21-4c4f-928d-a6088f74ce75","block_type":"box","text":"Fund, sold by a Fund but not yet delivered, or committed or anticipated to be purchased by a Fund. As an illustration,","page_number":67,"box":{"x":70,"y":687,"width":830,"height":11}},{"id":"3bcecb3b-4797-4d43-b398-ed6b2eb24abc","block_type":"box","text":"a Fund may use such techniques to hedge the stated value in U.S. dollars of an investment in a yen-denominated","page_number":67,"box":{"x":69,"y":702,"width":808,"height":12}},{"id":"f5533568-6093-45e9-bd69-805abe4fe3c8","block_type":"box","text":"security. For example, the Fund may purchase a foreign currency put option enabling it to sell a specified amount of","page_number":67,"box":{"x":69,"y":717,"width":824,"height":12}},{"id":"6f8e1f4a-d884-4731-b91f-0657520268c4","block_type":"box","text":"yen for dollars at a specified price by a future date. To the extent the hedge is successful, a loss in the value of the","page_number":67,"box":{"x":68,"y":732,"width":823,"height":12}},{"id":"16544971-bbd1-443a-a312-8c0a5f6a40ad","block_type":"box","text":"yen relative to the dollar will tend to be offset by an increase in the value of the put option. To offset, in whole or in","page_number":67,"box":{"x":68,"y":748,"width":821,"height":11}},{"id":"6c36a5b8-c354-42d6-b0fd-7b4381a4e054","block_type":"box","text":"par t, the cost of acquiring such a put option, the Fund may also sell a call option which, if exercised, requires it to","page_number":67,"box":{"x":70,"y":763,"width":813,"height":11}},{"id":"940389bf-a80c-480d-9363-b93630f20620","block_type":"box","text":"sell a specified amount of yen for dollars at a specified price by a future date (a technique called a “straddle”). By","page_number":67,"box":{"x":69,"y":778,"width":813,"height":11}},{"id":"cd3b68bf-6c50-4158-9243-e9a8f7e82768","block_type":"box","text":"selling such a call option in this illustration, the Fund gives up the oppor tunity to profit without limit from increases in","page_number":67,"box":{"x":69,"y":793,"width":835,"height":11}},{"id":"a738f4cc-3b7f-46da-8fff-c03f6fc821a4","block_type":"box","text":"the relative value of the yen to the dollar. “Straddles” of the type that may be used by a Fund are considered hedging","page_number":67,"box":{"x":68,"y":808,"width":836,"height":11}},{"id":"5f0e8886-dd94-41ae-b2c7-2e1235354322","block_type":"box","text":"transactions. Cer tain Funds have a fundamental investment restriction that restricts currency option strategies.","page_number":67,"box":{"x":68,"y":823,"width":794,"height":12}},{"id":"9912d5ee-c203-4cb4-b9a6-27ac74cb8289","block_type":"box","text":"Hedging transactions involving Currency Instruments involve substantial risks, including correlation risk. A Fund’s","page_number":67,"box":{"x":102,"y":846,"width":805,"height":11}},{"id":"5e6eb709-ad1f-4c4b-8119-5fd73d105446","block_type":"box","text":"use of Currency Instruments to effect hedging strategies is intended to reduce the volatility of the NAV of the Fund’s","page_number":67,"box":{"x":69,"y":861,"width":828,"height":11}},{"id":"6a647b23-3f53-44be-b220-51c5e6082a1f","block_type":"box","text":"shares; however, the use of such hedging strategies will not prevent the NAV of the Fund’s shares from fluctuating.","page_number":67,"box":{"x":69,"y":876,"width":819,"height":11}},{"id":"fa2032d5-ee7b-48c1-95b1-854c2804938b","block_type":"box","text":"Moreover, although Currency Instruments will be used with the intention of hedging against adverse currency","page_number":67,"box":{"x":70,"y":891,"width":773,"height":12}},{"id":"657a1565-3a22-4a14-b16d-b659dd61752c","block_type":"box","text":"movements, transactions in Currency Instruments involve the risk that anticipated currency movements will not be","page_number":67,"box":{"x":69,"y":906,"width":814,"height":12}},{"id":"3e384357-616c-487f-94a9-a94539f842f9","block_type":"box","text":"II-23","page_number":67,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"7e7b1555-1654-44af-984d-b0493a056779","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":67,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"e9b6e999-9325-4fe9-8438-d993cc89d12f","block_type":"box","text":"accurately predicted and that the Fund’s hedging strategies will be ineffective. To the extent that a Fund hedges","page_number":68,"box":{"x":69,"y":45,"width":796,"height":11}},{"id":"8e6a466a-334d-4502-a2fb-573d1c55d231","block_type":"box","text":"against anticipated currency movements that do not occur, the Fund may realize losses and decrease its total return.","page_number":68,"box":{"x":69,"y":60,"width":835,"height":11}},{"id":"0475d728-6c8d-4027-bad9-03709f36c86b","block_type":"box","text":"Fur thermore, a Fund will only engage in hedging activities from time to time and may not be engaging in hedging","page_number":68,"box":{"x":70,"y":75,"width":798,"height":11}},{"id":"2537cf99-b760-4cbd-9e8c-8ca272c56ce9","block_type":"box","text":"activities when movements in currency exchange rates actually occur.","page_number":68,"box":{"x":69,"y":90,"width":493,"height":11}},{"id":"dc33e83d-49cd-4b5b-af1b-0696a0a4320b","block_type":"box","text":"In connection with its trading in forward foreign currency contracts, a Fund will contract with a foreign or","page_number":68,"box":{"x":102,"y":113,"width":738,"height":11}},{"id":"ccf888b0-55da-4234-aead-ff992c0637ab","block_type":"box","text":"domestic bank, or foreign or domestic securities dealer, to make or take future delivery of a specified amount of a","page_number":68,"box":{"x":69,"y":128,"width":814,"height":11}},{"id":"970f6d7c-bcb1-4641-a876-2cf30a92db98","block_type":"box","text":"par ticular currency. There are no limitations on daily price moves in such forward contracts, and banks and dealers","page_number":68,"box":{"x":70,"y":143,"width":819,"height":11}},{"id":"2d4df333-e536-42df-ad02-9e989a2a8123","block_type":"box","text":"are not required to continue to make markets in such contracts. There have been periods during which cer tain banks","page_number":68,"box":{"x":69,"y":158,"width":834,"height":11}},{"id":"f838f829-d7f6-463b-83d0-82b73555ed8a","block_type":"box","text":"or dealers have refused to quote prices for such forward contracts or have quoted prices with an unusually wide","page_number":68,"box":{"x":69,"y":173,"width":797,"height":11}},{"id":"acaaca3b-d95d-4f5d-a161-da6a07182cce","block_type":"box","text":"spread between the price at which the bank or dealer is prepared to buy and that at which it is prepared to sell.","page_number":68,"box":{"x":69,"y":188,"width":794,"height":11}},{"id":"1d1d734b-83e9-4795-a0bf-74fce8a5ac3d","block_type":"box","text":"Governmental imposition of currency controls might limit any such forward contract trading. With respect to its trading","page_number":68,"box":{"x":69,"y":203,"width":841,"height":12}},{"id":"323ddd55-e26a-4bc9-85b8-c4023a5faa87","block_type":"box","text":"of forward contracts, if any, a Fund will be subject to counterpar ty risk. Any such failure to per form by a counterpar ty","page_number":68,"box":{"x":69,"y":218,"width":831,"height":12}},{"id":"83df2ee0-1eeb-45d3-920a-66f24bd00f67","block_type":"box","text":"would deprive the Fund of any profit potential or force the Fund to cover its commitments for resale, if any, at the","page_number":68,"box":{"x":68,"y":234,"width":805,"height":11}},{"id":"feccf4b2-f836-4261-a799-df69d40491a7","block_type":"box","text":"then market price and could result in a loss to the Fund.","page_number":68,"box":{"x":68,"y":249,"width":401,"height":11}},{"id":"95c1f3a7-3faf-4550-9c8f-ec75bdc5d4d9","block_type":"box","text":"It may not be possible for a Fund to hedge against currency exchange rate movements, even if correctly","page_number":68,"box":{"x":102,"y":271,"width":738,"height":12}},{"id":"5c5d60f4-ac36-4064-af01-68216f8fe520","block_type":"box","text":"anticipated, in the event that (i) the currency exchange rate movement is so generally anticipated that the Fund is not","page_number":68,"box":{"x":69,"y":287,"width":837,"height":11}},{"id":"9165c2e1-f180-4b8c-a5e2-87bc7deb348b","block_type":"box","text":"able to enter into a hedging transaction at an effective price, or (ii) the currency exchange rate movement relates to a","page_number":68,"box":{"x":69,"y":302,"width":837,"height":11}},{"id":"61e2c5d8-a5ab-4fcc-a273-ccb6e8019fca","block_type":"box","text":"market with respect to which Currency Instruments are not available and it is not possible to engage in effective","page_number":68,"box":{"x":69,"y":317,"width":800,"height":11}},{"id":"fba488a3-dc88-444d-9c7c-244eb7eb7bb3","block_type":"box","text":"foreign currency hedging. The cost to a Fund of engaging in foreign currency transactions varies with such factors as","page_number":68,"box":{"x":68,"y":332,"width":829,"height":11}},{"id":"87af0a34-12ee-46c5-8111-8009966fb974","block_type":"box","text":"the currencies involved, the length of the contract period and the market conditions then prevailing. Since","page_number":68,"box":{"x":68,"y":347,"width":753,"height":11}},{"id":"21382c1c-bfdf-435d-aaca-96607044d156","block_type":"box","text":"transactions in foreign currency exchange usually are conducted on a principal basis, no fees or commissions are","page_number":68,"box":{"x":68,"y":362,"width":811,"height":11}},{"id":"9f9468d7-6fdc-4fd9-8344-eda0585f25c8","block_type":"box","text":"involved.","page_number":68,"box":{"x":70,"y":377,"width":59,"height":9}},{"id":"a069f6d1-9918-4646-9ab6-deedf2730fab","block_type":"box","text":"A Fund will not hedge a currency in excess of the aggregate market value of the securities that it owns (including","page_number":68,"box":{"x":101,"y":400,"width":803,"height":11}},{"id":"8df21298-883c-4425-8ea2-5194911a4e5b","block_type":"box","text":"receivables for unsettled securities sales), or has committed to purchase or anticipates purchasing, which are","page_number":68,"box":{"x":69,"y":415,"width":785,"height":11}},{"id":"08618994-5681-484b-b8d5-08e13e6e121a","block_type":"box","text":"denominated in such currency.","page_number":68,"box":{"x":69,"y":430,"width":216,"height":11}},{"id":"d70ca00d-d397-49f1-836a-41541b10139f","block_type":"box","text":"Spot Transactions and FX Forwards.","page_number":68,"box":{"x":102,"y":453,"width":254,"height":11}},{"id":"a82d68fc-4230-437c-9ace-4fa9f95c2208","block_type":"box","text":"FX forwards are OTC contracts to purchase or sell a specified amount of a","page_number":68,"box":{"x":364,"y":453,"width":527,"height":11}},{"id":"5ea0c44f-ce29-4e62-af98-eee5aed7de01","block_type":"box","text":"specified currency or multinational currency unit at a specified price and specified future date. Spot foreign exchange","page_number":68,"box":{"x":69,"y":468,"width":834,"height":11}},{"id":"dcfb7f96-c136-406a-b71f-b5fad306dee7","block_type":"box","text":"transactions are similar but are settled in the current, or “spot”, market. A Fund will enter into foreign exchange","page_number":68,"box":{"x":68,"y":483,"width":798,"height":11}},{"id":"bd015b96-8c9e-483f-84d0-4424fe371e83","block_type":"box","text":"transactions for purposes of hedging either a specific transaction or a por tfolio position, or, with respect to cer tain","page_number":68,"box":{"x":68,"y":498,"width":817,"height":11}},{"id":"3875518c-c18f-4050-86d8-37e6107d0ab9","block_type":"box","text":"Funds, to seek to enhance returns. FX forwards involve substantial currency risk, credit risk and liquidity risk. A Fund","page_number":68,"box":{"x":70,"y":513,"width":830,"height":11}},{"id":"871f3a9c-afb2-4099-8b27-8fb2ddcb5696","block_type":"box","text":"may enter into a foreign exchange transaction for purposes of hedging a specific transaction by, for example,","page_number":68,"box":{"x":69,"y":528,"width":774,"height":12}},{"id":"0215129c-09e7-44d4-80ec-f3cd48788062","block_type":"box","text":"purchasing a currency needed to settle a security transaction or selling a currency in which the Fund has received or","page_number":68,"box":{"x":70,"y":544,"width":828,"height":11}},{"id":"a81378ff-93b8-4e3c-b9b6-8c0c752ae588","block_type":"box","text":"anticipates receiving a dividend or distribution. A Fund may enter into a foreign exchange transaction for purposes of","page_number":68,"box":{"x":69,"y":559,"width":830,"height":11}},{"id":"a803b361-96c1-41ab-a8e3-43ace2b46089","block_type":"box","text":"hedging a por tfolio position by selling forward a currency in which a por tfolio position of the Fund is denominated or","page_number":68,"box":{"x":69,"y":574,"width":826,"height":11}},{"id":"0674e540-e3da-4a18-870e-6236781320a3","block_type":"box","text":"by purchasing a currency in which the Fund anticipates acquiring a por tfolio position in the near future. A Fund may","page_number":68,"box":{"x":69,"y":589,"width":819,"height":11}},{"id":"8df9a113-9ac0-41d9-9372-10c6808fab40","block_type":"box","text":"also hedge a currency by entering into a transaction in a Currency Instrument denominated in a currency other than","page_number":68,"box":{"x":69,"y":604,"width":822,"height":11}},{"id":"9718e38d-812c-4ddf-b363-fe298564869f","block_type":"box","text":"the currency being hedged (a “cross-hedge”). A Fund will only enter into a cross-hedge if the Manager believes that","page_number":68,"box":{"x":68,"y":619,"width":819,"height":11}},{"id":"560e8fcb-639e-41a1-b611-904721aaea3d","block_type":"box","text":"(i) there is a demonstrably high correlation between the currency in which the cross-hedge is denominated and the","page_number":68,"box":{"x":69,"y":634,"width":814,"height":12}},{"id":"0c0708ba-860b-4bbc-8bdd-1025ce77d94c","block_type":"box","text":"currency being hedged, and (ii) executing a cross-hedge through the currency in which the cross-hedge is","page_number":68,"box":{"x":69,"y":650,"width":745,"height":11}},{"id":"017aa73e-cfc6-418d-b1ab-07d96a77f90c","block_type":"box","text":"denominated will be significantly more cost-effective or provide substantially greater liquidity than executing a similar","page_number":68,"box":{"x":69,"y":664,"width":832,"height":12}},{"id":"0f036e3d-e642-4162-ac1c-81f2821dc692","block_type":"box","text":"hedging transaction by means of the currency being hedged.","page_number":68,"box":{"x":69,"y":680,"width":428,"height":11}},{"id":"c17f14db-9a33-4576-a4ca-0386c4ee923d","block_type":"box","text":"A Fund may also engage in proxy hedging transactions to reduce the effect of currency fluctuations on the value","page_number":68,"box":{"x":101,"y":702,"width":797,"height":12}},{"id":"106d0daf-fae5-4aad-852b-77bd543e6715","block_type":"box","text":"of existing or anticipated holdings of por tfolio securities. Proxy hedging is often used when the currency to which the","page_number":68,"box":{"x":69,"y":717,"width":829,"height":12}},{"id":"00ee8ba8-e6f1-4060-85fb-b387d984de9f","block_type":"box","text":"Fund is exposed is difficult to hedge, or to hedge against the U.S. dollar. Proxy hedging entails entering into a forward","page_number":68,"box":{"x":70,"y":732,"width":838,"height":12}},{"id":"803b5d09-04f3-40b0-a10a-4916fe98f5ca","block_type":"box","text":"contract to sell a currency whose changes in value are generally considered to be linked to a currency or currencies","page_number":68,"box":{"x":69,"y":748,"width":823,"height":11}},{"id":"ed0b0c37-fc3b-4783-8728-9de51793d7d8","block_type":"box","text":"in which some or all of the Fund’s securities are, or are expected to be, denominated, and to buy U.S. dollars. Proxy","page_number":68,"box":{"x":70,"y":763,"width":827,"height":11}},{"id":"9f94a0be-84ac-41ec-94d1-5bfd26d6bbe9","block_type":"box","text":"hedging involves some of the same risks and considerations as other transactions with similar instruments. Currency","page_number":68,"box":{"x":69,"y":778,"width":838,"height":11}},{"id":"505382ea-c898-4513-9923-18d1c36a76fc","block_type":"box","text":"transactions can result in losses to the Fund if the currency being hedged fluctuates in value to a degree or in a","page_number":68,"box":{"x":68,"y":793,"width":798,"height":11}},{"id":"b348dc52-eb49-4690-86b9-fda5e859c955","block_type":"box","text":"direction that is not anticipated. In addition, there is the risk that the perceived linkage between various currencies","page_number":68,"box":{"x":69,"y":808,"width":819,"height":11}},{"id":"1dd598c7-9dc8-4a03-8e9d-c8075e86b7d9","block_type":"box","text":"may not be present, including during the par ticular time that a Fund is engaging in proxy hedging.","page_number":68,"box":{"x":69,"y":823,"width":691,"height":12}},{"id":"7703d8c1-cceb-499f-b81a-dba02b72f6f1","block_type":"box","text":"A Fund may also cross-hedge currencies by entering into forward contracts to sell one or more currencies that","page_number":68,"box":{"x":101,"y":846,"width":785,"height":11}},{"id":"99e75bb4-85a9-4f25-969b-43049a7eed14","block_type":"box","text":"are expected to decline in value relative to other currencies to which the Fund has or in which the Fund expects to","page_number":68,"box":{"x":69,"y":861,"width":811,"height":11}},{"id":"e93fbd88-4e7d-4ac4-a89a-667a136fe74b","block_type":"box","text":"have por tfolio exposure. For example, a Fund may hold both Canadian government bonds and Japanese government","page_number":68,"box":{"x":69,"y":876,"width":828,"height":11}},{"id":"5021ada0-496b-44e3-91cc-14a6a96ba840","block_type":"box","text":"bonds, and the Manager or sub-adviser may believe that Canadian dollars will deteriorate against Japanese yen. The","page_number":68,"box":{"x":69,"y":891,"width":829,"height":12}},{"id":"96eea1b8-e800-4786-9fd8-ffea058116e8","block_type":"box","text":"Fund would sell Canadian dollars to reduce its exposure to that currency and buy Japanese yen. This strategy would","page_number":68,"box":{"x":70,"y":906,"width":823,"height":12}},{"id":"2aaef7af-e9ee-47bd-9a4d-db310257429c","block_type":"box","text":"II-24","page_number":68,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"46e27222-9027-42c8-853c-bb3712703b44","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":68,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"46b0c12d-174c-4287-b7e0-2cea2d130fd6","block_type":"box","text":"be a hedge against a decline in the value of Canadian dollars, although it would expose the Fund to declines in the","page_number":69,"box":{"x":69,"y":45,"width":818,"height":11}},{"id":"77eb3598-38cf-4921-95bf-bb3fd7b5b6e6","block_type":"box","text":"value of the Japanese yen relative to the U.S. dollar.","page_number":69,"box":{"x":68,"y":60,"width":372,"height":11}},{"id":"5163fd29-2e45-49fc-88d7-e0849f6131d5","block_type":"box","text":"Some of the forward non-U.S. currency contracts entered into by the Funds are classified as non-deliverable","page_number":69,"box":{"x":102,"y":82,"width":768,"height":12}},{"id":"94ec216c-bf34-47b7-ba2d-75ef78343ac8","block_type":"box","text":"forwards (“NDFs”). NDFs are cash-settled, shor t-term forward contracts that may be thinly traded or are denominated","page_number":69,"box":{"x":68,"y":98,"width":838,"height":11}},{"id":"a9a674e7-f1de-4f96-9b90-33bbfd6f10af","block_type":"box","text":"in non-conver tible foreign currency, where the profit or loss at the time at the settlement date is calculated by taking","page_number":69,"box":{"x":70,"y":113,"width":829,"height":11}},{"id":"d86368db-753e-4531-9451-ddba77bc95ab","block_type":"box","text":"the difference between the agreed upon exchange rate and the spot rate at the time of settlement, for an agreed","page_number":69,"box":{"x":68,"y":128,"width":806,"height":11}},{"id":"a01d90fa-9f6c-4f07-9514-5c3febe411a3","block_type":"box","text":"upon notional amount of funds. All NDFs have a fixing date and a settlement date. The fixing date is the date at which","page_number":69,"box":{"x":69,"y":143,"width":839,"height":11}},{"id":"f9493100-a8b3-4464-9737-cb8e1ea635fa","block_type":"box","text":"the difference between the prevailing market exchange rate and the agreed upon exchange rate is calculated. The","page_number":69,"box":{"x":68,"y":158,"width":812,"height":11}},{"id":"10f7096e-e34b-4b80-967a-92100bd9f55e","block_type":"box","text":"settlement date is the date by which the payment of the difference is due to the par ty receiving payment. NDFs are","page_number":69,"box":{"x":69,"y":173,"width":821,"height":11}},{"id":"3a4d690e-38ba-4de5-a415-5679d35e8e6a","block_type":"box","text":"commonly quoted for time periods of one month up to two years, and are normally quoted and settled in U.S. dollars.","page_number":69,"box":{"x":69,"y":188,"width":835,"height":11}},{"id":"39ce09f3-5bea-494e-ab30-9b007cc1dc2e","block_type":"box","text":"They are often used to gain exposure to and/or hedge exposure to foreign currencies that are not internationally","page_number":69,"box":{"x":68,"y":203,"width":802,"height":12}},{"id":"bfead39e-1f6a-4566-88c1-b6280467d90b","block_type":"box","text":"traded.","page_number":69,"box":{"x":68,"y":219,"width":49,"height":8}},{"id":"28bb10f4-7050-4f88-8888-7e74a9a83d5f","block_type":"box","text":"Currency Futures.","page_number":69,"box":{"x":102,"y":241,"width":123,"height":11}},{"id":"91a8e65f-942d-4c14-84a3-0b9f3039be5d","block_type":"box","text":"A Fund may seek to enhance returns or hedge against the decline in the value of a currency","page_number":69,"box":{"x":232,"y":241,"width":654,"height":11}},{"id":"6a3052d2-f953-41dc-834d-79fe011114d7","block_type":"box","text":"through use of currency futures or options on currency futures. Currency futures are similar to forward foreign","page_number":69,"box":{"x":68,"y":256,"width":782,"height":12}},{"id":"8d344efe-2831-443f-8775-78c4d3117fc6","block_type":"box","text":"exchange transactions except that futures are standardized, exchange-traded contracts while forward foreign","page_number":69,"box":{"x":69,"y":271,"width":774,"height":12}},{"id":"9c517c5c-d3c5-49a9-b25c-f0518e5c5a75","block_type":"box","text":"exchange transactions are traded in the OTC market. Currency futures involve substantial currency risk as well as the","page_number":69,"box":{"x":69,"y":286,"width":836,"height":12}},{"id":"0e3e1f85-1b4b-4879-943b-191084909021","block_type":"box","text":"risks discussed above in “—Futures.”","page_number":69,"box":{"x":69,"y":302,"width":269,"height":9}},{"id":"e7b361c3-829c-4f97-8f6b-1da614a132a4","block_type":"box","text":"Currency Options.","page_number":69,"box":{"x":102,"y":324,"width":125,"height":11}},{"id":"ce3842eb-ead6-4410-a2c4-0023562f8870","block_type":"box","text":"A Fund may seek to enhance returns or hedge against the decline in the value of a currency","page_number":69,"box":{"x":233,"y":324,"width":654,"height":12}},{"id":"d4c3ba64-6c18-4371-8d15-eac79925c72f","block_type":"box","text":"through the use of currency options. Cer tain Funds have fundamental investment restrictions that permit the","page_number":69,"box":{"x":68,"y":339,"width":776,"height":12}},{"id":"f0570ce3-7494-41bc-aafd-df22df630a6f","block_type":"box","text":"purchase of currency options, but prohibit the writing of currency options. Currency options are similar to options on","page_number":69,"box":{"x":70,"y":355,"width":825,"height":11}},{"id":"dac9d14a-01bb-4916-887c-e13438c19988","block_type":"box","text":"securities. For example, in consideration for an option premium the writer of a currency option is obligated to sell (in","page_number":69,"box":{"x":69,"y":370,"width":827,"height":11}},{"id":"6731eb62-be1e-4e9a-b3e3-fe39b18406dd","block_type":"box","text":"the case of a call option) or purchase (in the case of a put option) a specified amount of a specified currency on or","page_number":69,"box":{"x":68,"y":385,"width":820,"height":11}},{"id":"fd66382f-184b-44ec-9d72-61210d114d7f","block_type":"box","text":"before the expiration date for a specified amount of another currency. A Fund may engage in transactions in options","page_number":69,"box":{"x":69,"y":400,"width":824,"height":11}},{"id":"87453a3f-9e33-4b8e-a747-645d9c20c9c9","block_type":"box","text":"on currencies either on exchanges or OTC markets. Such transactions in options may include exotic options on","page_number":69,"box":{"x":69,"y":415,"width":790,"height":11}},{"id":"7cbd8fd9-c5de-4a8c-8a6b-83ddff9c7d72","block_type":"box","text":"currencies, which are typically traded in OTC markets and have additional features that result in different payment","page_number":69,"box":{"x":69,"y":430,"width":813,"height":11}},{"id":"24b95fb6-4a58-491d-959a-efc82d5beba5","block_type":"box","text":"structures and/or expirations. Where a Fund is permitted to write currency options, it may write covered call options","page_number":69,"box":{"x":69,"y":446,"width":826,"height":10}},{"id":"d060c5cc-36fa-42fc-99d6-c0f006d740ca","block_type":"box","text":"on up to 100% of the currencies in its por tfolio. See “—Options” above. Currency options involve substantial","page_number":69,"box":{"x":69,"y":460,"width":776,"height":12}},{"id":"2fdcdeae-b4e2-43e7-8109-fdff85d77aa9","block_type":"box","text":"currency risk, and may also involve credit, leverage or illiquidity risk.","page_number":69,"box":{"x":69,"y":476,"width":483,"height":11}},{"id":"6bf6c3d9-59fc-4c2d-ab06-541a3d29ca7a","block_type":"box","text":"Currency Swaps.","page_number":69,"box":{"x":102,"y":498,"width":117,"height":11}},{"id":"6cb7bfa5-4478-410f-b55c-61ab58fd3bc9","block_type":"box","text":"A Fund may enter into currency swaps in order to protect against currency fluctuations or to","page_number":69,"box":{"x":225,"y":498,"width":652,"height":11}},{"id":"a602bd57-e75d-4d68-b377-12eed5c76b66","block_type":"box","text":"hedge por tfolio positions. Currency swaps are transactions in which one currency is simultaneously bought for a","page_number":69,"box":{"x":69,"y":513,"width":799,"height":12}},{"id":"c5a37e40-aa13-4815-9906-7d702ae1186e","block_type":"box","text":"second currency on a spot basis and sold for the second currency on a forward basis. Currency swaps involve the","page_number":69,"box":{"x":69,"y":528,"width":812,"height":12}},{"id":"809a2e28-a2dc-4984-926a-ea2fcec5e6ff","block_type":"box","text":"exchange of the rights of a Fund and another par ty to make or receive payments in specified currencies, and typically","page_number":69,"box":{"x":69,"y":543,"width":836,"height":12}},{"id":"af7d1b69-1bfc-4d82-aacb-11ac95e36c45","block_type":"box","text":"require the delivery of the entire principal value of one designated currency in exchange for the other designated","page_number":69,"box":{"x":69,"y":559,"width":800,"height":11}},{"id":"13781c8c-e2b6-4752-8778-268c21a8eba9","block_type":"box","text":"currency. As a result, the entire principal value of a currency swap is subject to the risk that the other par ty to the","page_number":69,"box":{"x":69,"y":574,"width":810,"height":11}},{"id":"3d3abe93-e1c0-4058-a40e-903ac79ba463","block_type":"box","text":"swap will default on its contractual delivery obligations.","page_number":69,"box":{"x":69,"y":589,"width":393,"height":11}},{"id":"6299c78b-250b-4594-b9e0-293d96968ef3","block_type":"box","text":"Distressed Securities.","page_number":69,"box":{"x":102,"y":612,"width":159,"height":9}},{"id":"e458862d-b8fc-47ea-9eb5-c9ba3b4b6d1c","block_type":"box","text":"A Fund may invest in securities, including loans purchased in the secondary market, that","page_number":69,"box":{"x":267,"y":612,"width":633,"height":11}},{"id":"d7b6ee38-9c40-475c-8b74-ab54041fedfc","block_type":"box","text":"are the subject of bankruptcy proceedings or otherwise in default or in risk of being in default as to the repayment of","page_number":69,"box":{"x":69,"y":627,"width":834,"height":11}},{"id":"af6a5fd4-f520-44f4-aa35-e8053ebb7396","block_type":"box","text":"principal and/or interest at the time of acquisition by the Fund or that are rated in the lower rating categories by one","page_number":69,"box":{"x":70,"y":642,"width":827,"height":11}},{"id":"0c7a201e-c4f2-4120-b6f4-4531526568ac","block_type":"box","text":"or more nationally recognized statistical rating organizations (for example, Ca or lower by Moody’s and CC or lower by","page_number":69,"box":{"x":69,"y":657,"width":835,"height":11}},{"id":"141bc2ea-8423-454c-9ae3-9fffcdfb13d8","block_type":"box","text":"S&P or Fitch) or, if unrated, are in the judgment of the Manager of equivalent quality (“Distressed Securities”).","page_number":69,"box":{"x":69,"y":672,"width":784,"height":11}},{"id":"cfb7cfb6-7e7b-47f8-b5c7-6abe0cdbbc04","block_type":"box","text":"Investment in Distressed Securities is speculative and involves significant risks.","page_number":69,"box":{"x":70,"y":687,"width":569,"height":11}},{"id":"64265734-c59b-4d33-a476-f9111e349a70","block_type":"box","text":"A Fund will generally make such investments only when the Manager believes it is reasonably likely that the","page_number":69,"box":{"x":101,"y":710,"width":766,"height":11}},{"id":"041b1f56-e28a-45d9-b223-b37b130f1189","block_type":"box","text":"issuer of the Distressed Securities will make an exchange offer or will be the subject of a plan of reorganization","page_number":69,"box":{"x":70,"y":725,"width":795,"height":11}},{"id":"80d7ee60-4d8a-4e28-96e5-b1ec19a5bdbf","block_type":"box","text":"pursuant to which the Fund will receive new securities in return for the Distressed Securities. However, there can be","page_number":69,"box":{"x":70,"y":740,"width":826,"height":11}},{"id":"d6af26b0-7f53-4db5-9dee-2b9d0dcd59d7","block_type":"box","text":"no assurance that such an exchange offer will be made or that such a plan of reorganization will be adopted. In","page_number":69,"box":{"x":69,"y":755,"width":794,"height":11}},{"id":"75c30f8b-e291-46b2-bd2e-07ae2855f59e","block_type":"box","text":"addition, a significant period of time may pass between the time at which a Fund makes its investment in Distressed","page_number":69,"box":{"x":69,"y":770,"width":832,"height":12}},{"id":"ca3a770e-5cb7-411f-9633-547330750238","block_type":"box","text":"Securities and the time that any such exchange offer or plan of reorganization is completed. During this period, it is","page_number":69,"box":{"x":69,"y":785,"width":824,"height":12}},{"id":"102aa4b5-66dd-415c-9975-ccfa958e2f8d","block_type":"box","text":"unlikely that a Fund will receive any interest payments on the Distressed Securities, the Fund will be subject to","page_number":69,"box":{"x":69,"y":801,"width":789,"height":11}},{"id":"67e305fa-a7d0-412b-8586-a820846935ad","block_type":"box","text":"significant uncer tainty as to whether or not the exchange offer or plan of reorganization will be completed and the","page_number":69,"box":{"x":69,"y":816,"width":810,"height":11}},{"id":"f408e1fb-9de3-436f-91f5-a1a7ee4d5830","block_type":"box","text":"Fund may be required to bear cer tain extraordinary expenses to protect and recover its investment. Therefore, to the","page_number":69,"box":{"x":70,"y":831,"width":831,"height":11}},{"id":"6a608e4f-8441-4692-8ea1-880be7884f85","block_type":"box","text":"extent the Fund seeks capital appreciation through investment in distressed securities, the Fund’s ability to achieve","page_number":69,"box":{"x":69,"y":846,"width":826,"height":11}},{"id":"f2440bcc-db07-42b0-bdba-86bfe7386d82","block_type":"box","text":"current income for its shareholders may be diminished. The Fund also will be subject to significant uncer tainty as to","page_number":69,"box":{"x":69,"y":861,"width":827,"height":11}},{"id":"79fef945-b6ae-42f8-8b40-1883681fd116","block_type":"box","text":"when and in what manner and for what value the obligations evidenced by the distressed securities will eventually be","page_number":69,"box":{"x":68,"y":876,"width":834,"height":11}},{"id":"05c0c786-437d-410e-b127-0c73017e9b90","block_type":"box","text":"satisfied (","page_number":69,"box":{"x":69,"y":891,"width":70,"height":11}},{"id":"d642a9d2-6dae-4387-972e-6110b6de4c79","block_type":"box","text":"e.g.","page_number":69,"box":{"x":140,"y":893,"width":25,"height":10}},{"id":"919f7145-df52-49e4-98a8-b601378c5540","block_type":"box","text":", through a liquidation of the obligor’s assets, an exchange offer or plan of reorganization involving the","page_number":69,"box":{"x":168,"y":891,"width":729,"height":12}},{"id":"6512cd9a-35cd-46a0-9d09-cf6196e78b8a","block_type":"box","text":"distressed securities or a payment of some amount in satisfaction of the obligation). Even if an exchange offer is","page_number":69,"box":{"x":69,"y":906,"width":807,"height":12}},{"id":"ec280c4f-fa80-4b5c-98c4-ae287ce74644","block_type":"box","text":"II-25","page_number":69,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"7a1057b3-0ed2-4963-b52d-36ec71cfb0d8","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":69,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"ba6f5512-573f-4780-8889-92d04ba8873c","block_type":"box","text":"made or plan of reorganization is adopted with respect to Distressed Securities held by a Fund, there can be no","page_number":70,"box":{"x":69,"y":45,"width":797,"height":11}},{"id":"38dfeda3-e07d-4ce8-a9bc-f20ac82be0d9","block_type":"box","text":"assurance that the securities or other assets received by a Fund in connection with such exchange offer or plan of","page_number":70,"box":{"x":69,"y":60,"width":816,"height":11}},{"id":"646f7a41-975a-474c-a7ac-989ebdddcd41","block_type":"box","text":"reorganization will not have a lower value or income potential than may have been anticipated when the investment","page_number":70,"box":{"x":69,"y":75,"width":821,"height":11}},{"id":"772e4682-ca94-4dc0-87a6-6447b6faa54a","block_type":"box","text":"was made or no value. Moreover, any securities received by a Fund upon completion of an exchange offer or plan of","page_number":70,"box":{"x":68,"y":90,"width":827,"height":11}},{"id":"c8c9cc06-f549-444c-a4ad-44f1a1df4ea9","block_type":"box","text":"reorganization may be restricted as to resale. Similarly, if a Fund par ticipates in negotiations with respect to any","page_number":70,"box":{"x":69,"y":105,"width":800,"height":11}},{"id":"5319ea4e-277d-4bef-97f3-5939de7c9300","block_type":"box","text":"exchange offer or plan of reorganization with respect to an issuer of Distressed Securities, the Fund may be","page_number":70,"box":{"x":69,"y":120,"width":770,"height":12}},{"id":"7dca6f8c-329c-48e9-8f05-b4c5c8f73710","block_type":"box","text":"restricted from disposing of such securities. To the extent that a Fund becomes involved in such proceedings, the","page_number":70,"box":{"x":69,"y":135,"width":809,"height":12}},{"id":"115f7268-28c3-437f-9f18-18652fce50fa","block_type":"box","text":"Fund may have a more active par ticipation in the affairs of the issuer than that assumed generally by an investor. The","page_number":70,"box":{"x":70,"y":150,"width":839,"height":12}},{"id":"53a703e0-6440-4afe-83ef-29cc994bf9b3","block_type":"box","text":"Fund, however, will not make investments for the purpose of exercising day-to-day management of any issuer’s","page_number":70,"box":{"x":70,"y":166,"width":787,"height":11}},{"id":"1fa9fe6a-01b0-4f9b-b7a4-dec0bba6c9a4","block_type":"box","text":"affairs.","page_number":70,"box":{"x":69,"y":181,"width":49,"height":9}},{"id":"3109910c-8e27-45fd-b179-cae6184741ab","block_type":"box","text":"Environmental, Social and Governance (“ESG”) Integration","page_number":70,"box":{"x":102,"y":203,"width":428,"height":11}},{"id":"6a1503d1-2096-4e3f-acc7-d89335da261f","block_type":"box","text":". Although a Fund does not seek to implement a","page_number":70,"box":{"x":531,"y":204,"width":341,"height":11}},{"id":"f3663df7-71f1-409c-ba3d-1f1545ff7dd4","block_type":"box","text":"specific sustainability objective, strategy or process unless disclosed in its Prospectus, Fund management will","page_number":70,"box":{"x":69,"y":218,"width":785,"height":12}},{"id":"5c0f3d1e-2ed8-4d62-849e-758359c28cc5","block_type":"box","text":"consider ESG factors as par t of the investment process for the Fund. Fund management views ESG integration as the","page_number":70,"box":{"x":69,"y":234,"width":838,"height":11}},{"id":"ec436303-9f2f-4be5-97cd-2e8a828dbd2e","block_type":"box","text":"practice of incorporating financially material ESG data or information into investment processes with the objective of","page_number":70,"box":{"x":70,"y":249,"width":827,"height":11}},{"id":"2e1c1fc2-33a1-42af-8e20-568d5082c15d","block_type":"box","text":"enhancing risk-adjusted returns. These ESG considerations will vary depending on a Fund’s par ticular investment","page_number":70,"box":{"x":69,"y":264,"width":806,"height":11}},{"id":"553e56ac-e971-4d44-a7d9-32b34a55330a","block_type":"box","text":"strategies and may include consideration of third-par ty research as well as consideration of proprietary BlackRock","page_number":70,"box":{"x":69,"y":279,"width":812,"height":11}},{"id":"3f726ddf-041f-4f38-9e59-51393f8dd02e","block_type":"box","text":"research across the ESG risks and oppor tunities regarding an issuer. The ESG characteristics utilized in a Fund’s","page_number":70,"box":{"x":69,"y":294,"width":807,"height":11}},{"id":"8c75d9ca-81c6-439d-bd4d-eb2515431b35","block_type":"box","text":"investment process are anticipated to evolve over time and one or more characteristics may not be relevant with","page_number":70,"box":{"x":70,"y":309,"width":800,"height":11}},{"id":"b3fbc87f-273e-4212-a7e7-f503ef5c5730","block_type":"box","text":"respect to all issuers that are eligible for investment.","page_number":70,"box":{"x":69,"y":324,"width":377,"height":12}},{"id":"ce5c3745-825a-468d-9fab-3ba6514cf159","block_type":"box","text":"Cer tain of these considerations may affect a Fund’s exposure to cer tain companies or industries. While Fund","page_number":70,"box":{"x":102,"y":347,"width":778,"height":11}},{"id":"fb84d104-6a81-41b2-8c0e-b0aaa3cf1999","block_type":"box","text":"management views ESG considerations as having the potential to contribute to a Fund’s long-term per formance,","page_number":70,"box":{"x":69,"y":362,"width":800,"height":11}},{"id":"70b5f93f-9848-41cf-92f5-1465cb30f9ac","block_type":"box","text":"there is no guarantee that such results will be achieved.","page_number":70,"box":{"x":68,"y":377,"width":400,"height":12}},{"id":"b9eb3e9a-5f52-4ecf-98d6-1c1222e9fa9f","block_type":"box","text":"Equity Securities.","page_number":70,"box":{"x":102,"y":400,"width":127,"height":11}},{"id":"4aed353f-42b9-4511-90c8-57f89d3e1040","block_type":"box","text":"Cer tain Funds may invest in equity securities, which include common stock and, for cer tain","page_number":70,"box":{"x":235,"y":400,"width":648,"height":11}},{"id":"370431b1-2094-48e1-a890-fa9c5352b685","block_type":"box","text":"Funds, preferred stock (including conver tible preferred stock); bonds, stock purchase warrants and rights; equity","page_number":70,"box":{"x":70,"y":415,"width":802,"height":11}},{"id":"fe833825-178f-4c08-b097-db8f3533e8c4","block_type":"box","text":"interests in trusts; general and limited par tnerships and limited liability companies; and depositary receipts. Stock","page_number":70,"box":{"x":70,"y":430,"width":817,"height":11}},{"id":"6689cfde-1d73-4e2d-8865-cebe0028372a","block_type":"box","text":"markets are volatile. The price of equity securities will fluctuate and can decline and reduce the value of a por tfolio","page_number":70,"box":{"x":69,"y":445,"width":819,"height":11}},{"id":"0662d8c6-1729-44ec-8c01-05628c06ab2d","block_type":"box","text":"investing in equities. The price of equity securities fluctuates based on changes in a company’s financial condition","page_number":70,"box":{"x":70,"y":460,"width":813,"height":12}},{"id":"0d7b37a8-47f2-4da4-8d2d-cddcce24d324","block_type":"box","text":"and overall market and economic conditions. The value of equity securities purchased by the Fund could decline if the","page_number":70,"box":{"x":69,"y":475,"width":839,"height":12}},{"id":"2891f3b5-9048-4d26-aca3-20e04faf2ef1","block_type":"box","text":"financial condition of the companies the Fund invests in decline or if overall market and economic conditions","page_number":70,"box":{"x":68,"y":491,"width":775,"height":11}},{"id":"543da16e-3028-44d3-a53b-b17ee15c4f07","block_type":"box","text":"deteriorate. They may also decline due to factors that affect a par ticular industry or industries, such as labor","page_number":70,"box":{"x":69,"y":506,"width":777,"height":11}},{"id":"9142967f-3a6b-412f-9238-566c4d68ecf3","block_type":"box","text":"shor tages or increase in production costs and competitive conditions within an industry. In addition, they may decline","page_number":70,"box":{"x":69,"y":521,"width":837,"height":11}},{"id":"1a0640c0-3b44-48bd-87ae-8609a8e83ba7","block_type":"box","text":"due to general market conditions that are not specifically related to a company or industry, such as real or perceived","page_number":70,"box":{"x":69,"y":536,"width":831,"height":11}},{"id":"bb5dba59-724f-48c9-9cc5-187e99a2539a","block_type":"box","text":"adverse economic conditions, changes in the general outlook for corporate earnings, changes in interest or currency","page_number":70,"box":{"x":69,"y":551,"width":829,"height":11}},{"id":"fb564ec8-af86-4c50-ab57-a49938c8024d","block_type":"box","text":"rates or generally adverse investor sentiment.","page_number":70,"box":{"x":69,"y":566,"width":325,"height":11}},{"id":"58f796d5-79df-473f-bf09-2522ca4fdf17","block_type":"box","text":"From time to time cer tain of the Funds may invest in shares of companies through initial public offerings","page_number":70,"box":{"x":102,"y":589,"width":745,"height":11}},{"id":"2e0ff15d-da05-435f-843b-fbaaf976909b","block_type":"box","text":"(“IPOs”). IPOs have the potential to produce, and have in fact produced, substantial gains for cer tain Funds. There is","page_number":70,"box":{"x":69,"y":604,"width":833,"height":11}},{"id":"c3579971-c881-4f9c-a7bc-039fb2b7fdb2","block_type":"box","text":"no assurance that any Fund will have continued access to profitable IPOs and therefore investors should not rely on","page_number":70,"box":{"x":69,"y":619,"width":824,"height":11}},{"id":"1dc97bcd-5a57-414f-8632-73fb4d70facb","block_type":"box","text":"these past gains as an indication of future per formance. The investment per formance of a Fund during periods when","page_number":70,"box":{"x":68,"y":634,"width":834,"height":12}},{"id":"1f0c5acc-a418-460f-87a9-c0a08d6c10c7","block_type":"box","text":"it is unable to invest significantly or at all in IPOs may be lower than during periods when it is able to do so. In","page_number":70,"box":{"x":70,"y":649,"width":782,"height":12}},{"id":"55626814-cbfe-474d-827b-544f16cea592","block_type":"box","text":"addition, as a Fund increases in size, the impact of IPOs on its per formance will generally decrease. Securities","page_number":70,"box":{"x":69,"y":664,"width":790,"height":12}},{"id":"b4994365-66dc-4fd0-a3f2-83c6d4e64bbf","block_type":"box","text":"issued in IPOs are subject to many of the same risks as investing in companies with smaller market capitalizations.","page_number":70,"box":{"x":70,"y":680,"width":823,"height":11}},{"id":"44b0b057-6a40-41ad-9916-1576cf50ba8a","block_type":"box","text":"Securities issued in IPOs have no trading history, and information about the companies may be available for very","page_number":70,"box":{"x":69,"y":695,"width":805,"height":11}},{"id":"777f353b-593a-4a5e-a700-d398602d12ae","block_type":"box","text":"limited periods. In addition, the prices of securities sold in IPOs may be highly volatile or may decline shor tly after the","page_number":70,"box":{"x":70,"y":710,"width":836,"height":11}},{"id":"239c8a32-7c14-4b85-8fbe-a419600c957b","block_type":"box","text":"initial public offering.","page_number":70,"box":{"x":70,"y":725,"width":147,"height":11}},{"id":"5e8ba36a-40f6-45e5-b9e9-d4313a180cf9","block_type":"box","text":"The Funds may invest in companies that have relatively small market capitalizations. These organizations will","page_number":70,"box":{"x":101,"y":748,"width":777,"height":11}},{"id":"e49580bb-98ed-4c78-8b56-f96ffcb192a8","block_type":"box","text":"normally have more limited product lines, markets and financial resources and will be dependent upon a more limited","page_number":70,"box":{"x":69,"y":763,"width":838,"height":11}},{"id":"3c6bad91-5269-4019-bc05-7ed8ed947017","block_type":"box","text":"management group than larger capitalized companies. In addition, it is more difficult to get information on smaller","page_number":70,"box":{"x":69,"y":778,"width":815,"height":11}},{"id":"8103f5e5-5b02-4c44-aa28-ea9f9d974539","block_type":"box","text":"companies, which tend to be less well known, have shor ter operating histories, do not have significant ownership by","page_number":70,"box":{"x":69,"y":793,"width":829,"height":11}},{"id":"ee53aac7-3656-46a8-aa63-10cdcad53d6e","block_type":"box","text":"large investors and are followed by relatively few securities analysts. The securities of smaller capitalized companies","page_number":70,"box":{"x":70,"y":808,"width":831,"height":11}},{"id":"0feb426d-8a68-4419-a81e-0c3aff6483bf","block_type":"box","text":"are often traded in the OTC markets and may have fewer market makers and wider price spreads. This may result in","page_number":70,"box":{"x":69,"y":823,"width":826,"height":11}},{"id":"027a4c3e-53a8-4e3c-a938-14b1b0bc0a19","block_type":"box","text":"greater price movements and less ability to sell a Fund’s investment than if the Fund held the securities of larger,","page_number":70,"box":{"x":68,"y":838,"width":810,"height":12}},{"id":"1c0e617c-ce78-41bf-8167-d40e16315049","block_type":"box","text":"more established companies.","page_number":70,"box":{"x":69,"y":854,"width":209,"height":10}},{"id":"8f17d81e-eed4-4150-9b35-532c0fa87a02","block_type":"box","text":"II-26","page_number":70,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"8e812180-61da-4d10-9c7d-4d4be66103f3","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":70,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"92812956-f916-4308-96c3-448b04551261","block_type":"box","text":"For a discussion of the types of equity securities in which your Fund may invest and the risks associated with","page_number":71,"box":{"x":102,"y":45,"width":776,"height":11}},{"id":"93f0356e-217f-426d-9843-35b691ee4dc8","block_type":"box","text":"investing in such equity securities, see your Fund’s Prospectus. Cer tain of the Funds may also invest in shares of","page_number":71,"box":{"x":70,"y":60,"width":810,"height":11}},{"id":"624091a7-00c6-45ec-8ba3-380aac10395d","block_type":"box","text":"private companies, which are subject to the risks of “Illiquid Investments” and “Restricted Securities” described","page_number":71,"box":{"x":70,"y":75,"width":799,"height":11}},{"id":"d1b899ce-a8ed-4db9-8183-4f44ed35fade","block_type":"box","text":"below.","page_number":71,"box":{"x":69,"y":90,"width":43,"height":9}},{"id":"01e34bd3-0f3a-43dd-a85e-4606fee3783d","block_type":"box","text":"Real Estate-Related Securities.","page_number":71,"box":{"x":102,"y":113,"width":219,"height":9}},{"id":"ec96f114-d512-42df-9ceb-62fd1e480a82","block_type":"box","text":"Although no Fund may invest directly in real estate, cer tain Funds may invest in","page_number":71,"box":{"x":327,"y":113,"width":565,"height":11}},{"id":"41063b49-df4a-462d-9d51-20ed421bda8a","block_type":"box","text":"equity securities of issuers that are principally engaged in the real estate industry. Such investments are subject to","page_number":71,"box":{"x":69,"y":128,"width":822,"height":11}},{"id":"ccd09322-52b2-4c2a-9f6d-5d303305595a","block_type":"box","text":"cer tain risks associated with the ownership of real estate and with the real estate industry in general. These risks","page_number":71,"box":{"x":69,"y":143,"width":814,"height":11}},{"id":"016159d9-4508-4f39-a59b-bdb9721fd316","block_type":"box","text":"include, among others: possible declines in the value of real estate; risks related to general and local economic","page_number":71,"box":{"x":70,"y":158,"width":796,"height":11}},{"id":"f67e2315-2453-49ca-bd01-51825269a21d","block_type":"box","text":"conditions; possible lack of availability of mor tgage funds or other limitations on access to capital; overbuilding; risks","page_number":71,"box":{"x":69,"y":173,"width":836,"height":11}},{"id":"8825e065-4ef8-4190-a6bc-a68de9cf073c","block_type":"box","text":"associated with leverage; market illiquidity; extended vacancies of proper ties; increase in competition, proper ty","page_number":71,"box":{"x":69,"y":188,"width":795,"height":12}},{"id":"e6e2c059-5531-49ac-b1f9-e23ba0084932","block_type":"box","text":"taxes, capital expenditures and operating expenses; changes in zoning laws or other governmental regulation; costs","page_number":71,"box":{"x":68,"y":204,"width":828,"height":11}},{"id":"5251557d-e3fa-4e1e-9964-1ca74fa815cc","block_type":"box","text":"resulting from the clean-up of, and liability to third par ties for damages resulting from, environmental problems;","page_number":71,"box":{"x":69,"y":218,"width":794,"height":12}},{"id":"1949cd80-b2c4-4c0f-bfd6-548e23d8ec82","block_type":"box","text":"tenant bankruptcies or other credit problems; casualty or condemnation losses; uninsured damages from floods,","page_number":71,"box":{"x":68,"y":234,"width":805,"height":11}},{"id":"6f2a504c-5d7d-4ea4-9e7f-16d4082c49ca","block_type":"box","text":"ear thquakes or other natural disasters; limitations on and variations in rents, including decreases in market rates for","page_number":71,"box":{"x":69,"y":249,"width":836,"height":11}},{"id":"d046a1ab-7a3a-4e6f-a1d4-8c2f19cfb04b","block_type":"box","text":"rents; investment in developments that are not completed or that are subject to delays in completion; and changes in","page_number":71,"box":{"x":69,"y":264,"width":838,"height":11}},{"id":"5f5a059d-c417-46c4-a042-2ce1ab4167ac","block_type":"box","text":"interest rates. To the extent that assets underlying a Fund’s investments are concentrated geographically, by proper ty","page_number":71,"box":{"x":70,"y":279,"width":838,"height":11}},{"id":"3b6da430-fdd9-435b-bcc2-ac3b6d5331d8","block_type":"box","text":"type or in cer tain other respects, the Fund may be subject to cer tain of the foregoing risks to a greater extent.","page_number":71,"box":{"x":68,"y":294,"width":785,"height":11}},{"id":"f5dae0bc-06e4-47f6-ba12-66d4dc7e014c","block_type":"box","text":"Investments by a Fund in securities of companies providing mor tgage servicing will be subject to the risks associated","page_number":71,"box":{"x":70,"y":309,"width":836,"height":11}},{"id":"16ed65f9-9da3-4219-9f9b-e03fd7fa96f9","block_type":"box","text":"with refinancings and their impact on servicing rights.","page_number":71,"box":{"x":68,"y":324,"width":381,"height":12}},{"id":"50302333-afb3-4582-ac27-eac1b4bd6bf3","block_type":"box","text":"In addition, if a Fund receives rental income or income from the disposition of real proper ty acquired as a result","page_number":71,"box":{"x":102,"y":347,"width":797,"height":11}},{"id":"0da2e1f2-d3c2-4d3e-ac77-28a736001365","block_type":"box","text":"of a default on securities the Fund owns, the receipt of such income may adversely affect the Fund’s ability to retain","page_number":71,"box":{"x":69,"y":362,"width":829,"height":11}},{"id":"4a6456a9-6cc1-40d5-8c0d-b0a21372ebf3","block_type":"box","text":"its tax status as a regulated investment company because of cer tain income source requirements applicable to","page_number":71,"box":{"x":70,"y":377,"width":794,"height":12}},{"id":"62dbdd41-59a2-4d7a-b07b-72ff063d9d18","block_type":"box","text":"regulated investment companies under the Internal Revenue Code of 1986, as amended (the “Code”).","page_number":71,"box":{"x":69,"y":392,"width":730,"height":12}},{"id":"b8f5ac4c-dceb-4240-bff9-f2560e6cf9f1","block_type":"box","text":"Securities of Smaller or Emerging Growth Companies.","page_number":71,"box":{"x":102,"y":415,"width":381,"height":11}},{"id":"47560c1d-6cfa-400e-9a4d-136dec3f20ea","block_type":"box","text":"Investment in smaller or emerging growth companies","page_number":71,"box":{"x":490,"y":415,"width":376,"height":11}},{"id":"088234ee-ac7a-44ca-ac6e-20354c8b83c1","block_type":"box","text":"involves greater risk than is customarily associated with investments in more established companies. The securities","page_number":71,"box":{"x":70,"y":430,"width":828,"height":11}},{"id":"1356f480-56ec-486e-bdc8-74e335f1c14f","block_type":"box","text":"of smaller or emerging growth companies may be subject to more abrupt or erratic market movements than larger,","page_number":71,"box":{"x":69,"y":445,"width":815,"height":12}},{"id":"475518d7-bebd-4bcc-8d55-3ef21c2e9538","block_type":"box","text":"more established companies or the market average in general. These companies may have limited product lines,","page_number":71,"box":{"x":69,"y":461,"width":804,"height":11}},{"id":"fe8af966-e467-4395-8d5a-8248d3f458c4","block_type":"box","text":"markets or financial resources, or they may be dependent on a limited management group.","page_number":71,"box":{"x":69,"y":475,"width":647,"height":12}},{"id":"7105e061-3a5f-48b0-b2b4-46d792dac332","block_type":"box","text":"Investments in smaller or emerging growth companies may involve greater risks and thus may be considered","page_number":71,"box":{"x":102,"y":498,"width":773,"height":11}},{"id":"ee101e91-6f78-4d59-8fa1-774c4e6aa6d0","block_type":"box","text":"speculative. Full development of these companies and trends frequently takes time.","page_number":71,"box":{"x":69,"y":513,"width":597,"height":11}},{"id":"af1f5ee3-ed8e-43c3-8f1c-e7fa1a84d3f6","block_type":"box","text":"Small cap and emerging growth securities will often be traded only in the OTC market or on a regional securities","page_number":71,"box":{"x":102,"y":536,"width":797,"height":11}},{"id":"ca42496d-dcc7-4029-88a4-dfd022c87a99","block_type":"box","text":"exchange and may not be traded every day or in the volume typical of trading on a national securities exchange. As a","page_number":71,"box":{"x":69,"y":551,"width":832,"height":11}},{"id":"b4bf03b2-054d-4166-b92e-22e2aa31bd9c","block_type":"box","text":"result, the disposition by a Fund of por tfolio securities to meet redemptions or otherwise may require the Fund to","page_number":71,"box":{"x":69,"y":566,"width":808,"height":11}},{"id":"f15f9683-d6bd-449f-be55-d909ab839c6b","block_type":"box","text":"make many small sales over a lengthy period of time, or to sell these securities at a discount from market prices or","page_number":71,"box":{"x":69,"y":581,"width":825,"height":12}},{"id":"776d4e1a-2979-48ec-bfc8-ba9b93c6ab93","block_type":"box","text":"during periods when, in Fund management’s judgment, such disposition is not desirable.","page_number":71,"box":{"x":69,"y":597,"width":631,"height":11}},{"id":"5faaed8f-f580-4665-b23f-fb324901ce1a","block_type":"box","text":"The process of selection and continuous supervision by Fund management does not guarantee successful","page_number":71,"box":{"x":101,"y":619,"width":758,"height":11}},{"id":"aef01cf0-d4e0-4b54-8549-591725f25788","block_type":"box","text":"investment results. Careful initial selection is par ticularly impor tant in this area as many new enterprises have","page_number":71,"box":{"x":70,"y":634,"width":787,"height":11}},{"id":"aa8331e9-93e2-476b-a356-8a3b4fc12d26","block_type":"box","text":"promise but lack cer tain of the fundamental factors necessary to prosper. Investing in small cap and emerging","page_number":71,"box":{"x":70,"y":649,"width":789,"height":12}},{"id":"176cb9ad-f00d-4bf3-9725-35eb7c00e508","block_type":"box","text":"growth companies requires specialized research and analysis.","page_number":71,"box":{"x":68,"y":665,"width":442,"height":11}},{"id":"16e7e6cd-dfdd-469b-af09-59c98dbe376f","block_type":"box","text":"Fund management believes that relatively small companies may have the oppor tunity to develop into significant","page_number":71,"box":{"x":102,"y":687,"width":795,"height":11}},{"id":"49dd47a1-d63a-4b87-b027-ab50269db6d3","block_type":"box","text":"business enterprises. A Fund may invest in securities of small issuers in the relatively early stages of business","page_number":71,"box":{"x":69,"y":702,"width":791,"height":12}},{"id":"51e948d2-128f-42fa-a922-4ed54e6b2dc4","block_type":"box","text":"development that have a new technology, a unique or proprietary product or service, or a favorable market position.","page_number":71,"box":{"x":69,"y":717,"width":823,"height":12}},{"id":"b987a574-c03c-4db6-8ad3-01d99dd4a0c0","block_type":"box","text":"Equity securities of specific small cap issuers may present different oppor tunities for long-term capital","page_number":71,"box":{"x":102,"y":740,"width":729,"height":11}},{"id":"b9052015-a9d5-4701-ac80-15ad4337c53b","block_type":"box","text":"appreciation during varying por tions of economic or securities market cycles, as well as during varying stages of their","page_number":71,"box":{"x":69,"y":755,"width":837,"height":11}},{"id":"2ea11e7f-30e1-407a-bb7a-d2c243924b2d","block_type":"box","text":"business development. The market valuation of small cap issuers tends to fluctuate during economic or market","page_number":71,"box":{"x":69,"y":770,"width":794,"height":12}},{"id":"73f4606a-124f-4fe2-b01e-4bb6bda5f94e","block_type":"box","text":"cycles.","page_number":71,"box":{"x":69,"y":786,"width":46,"height":11}},{"id":"70563e18-314f-4e42-9ded-3c6c7cfe9d5f","block_type":"box","text":"Tracking Stocks","page_number":71,"box":{"x":103,"y":808,"width":110,"height":11}},{"id":"9f3dedcc-363c-43df-98ad-f4f8c68aca99","block_type":"box","text":". A tracking stock is a separate class of common stock whose value is linked to a specific","page_number":71,"box":{"x":214,"y":808,"width":640,"height":11}},{"id":"6ab22136-58e8-4538-ac81-3b655cd82c80","block_type":"box","text":"business unit or operating division within a larger company and is designed to “track” the per formance of such","page_number":71,"box":{"x":69,"y":823,"width":791,"height":12}},{"id":"08ac3da5-0172-43e1-98c6-9170df360f0f","block_type":"box","text":"business unit or division. The tracking stock may pay dividends to shareholders independent of the parent company.","page_number":71,"box":{"x":69,"y":838,"width":826,"height":12}},{"id":"492e923a-992b-4eb7-8756-d2721be4aa47","block_type":"box","text":"The parent company, rather than the business unit or division, generally is the issuer of tracking stock. However,","page_number":71,"box":{"x":68,"y":853,"width":801,"height":12}},{"id":"5852a9cd-24d3-4c2d-b55d-9949bd4ae407","block_type":"box","text":"holders of the tracking stock may not have the same rights as holders of the company’s common stock.","page_number":71,"box":{"x":69,"y":869,"width":740,"height":11}},{"id":"04087dfe-d810-483e-9814-667be77abf58","block_type":"box","text":"Exchange-Traded Notes (“ETNs”).","page_number":71,"box":{"x":102,"y":891,"width":245,"height":11}},{"id":"2d63b7c0-ccc2-44b4-b032-2325e42119d5","block_type":"box","text":"Cer tain Funds may invest in ETNs. ETNs are generally notes representing","page_number":71,"box":{"x":354,"y":891,"width":521,"height":12}},{"id":"867ae7b7-0858-437c-87d6-a80fc0e65005","block_type":"box","text":"debt of the issuer, usually a financial institution. ETNs combine aspects of both bonds and ETFs. An ETN’s returns","page_number":71,"box":{"x":69,"y":906,"width":814,"height":12}},{"id":"25e17112-2c79-4bc6-bc89-c326252f8047","block_type":"box","text":"II-27","page_number":71,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f4d7bfd7-d037-4006-91e8-aa4d67e7d48b","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":71,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"fd2bfb26-dd10-453e-b3a9-92c66702a8fc","block_type":"box","text":"are based on the per formance of one or more underlying assets, reference rates or indexes, minus fees and","page_number":72,"box":{"x":69,"y":45,"width":774,"height":11}},{"id":"1d9dad17-0a81-4aba-afd2-aa7470662691","block_type":"box","text":"expenses. Similar to ETFs, ETNs are listed on an exchange and traded in the secondary market. However, unlike an","page_number":72,"box":{"x":69,"y":60,"width":822,"height":11}},{"id":"fc3d951f-5553-4140-abce-f350a4b4aefe","block_type":"box","text":"ETF, an ETN can be held until the ETN’s maturity, at which time the issuer will pay a return linked to the per formance","page_number":72,"box":{"x":70,"y":75,"width":831,"height":11}},{"id":"da777809-4a9d-47d6-93d8-746e352e2947","block_type":"box","text":"of the specific asset, index or rate (“reference instrument”) to which the ETN is linked minus cer tain fees. Unlike","page_number":72,"box":{"x":69,"y":90,"width":805,"height":11}},{"id":"65616e4d-72a8-4b99-be43-9d1d643bd76a","block_type":"box","text":"regular bonds, ETNs do not make periodic interest payments, and principal is not protected.","page_number":72,"box":{"x":69,"y":105,"width":654,"height":11}},{"id":"ba48b8d1-69f1-4654-9dcf-e421548ebf54","block_type":"box","text":"The value of an ETN may be influenced by, among other things, time to maturity, level of supply and demand for","page_number":72,"box":{"x":101,"y":128,"width":794,"height":11}},{"id":"6697eaaa-7b61-4e44-a642-71c710cab517","block_type":"box","text":"the ETN, volatility and lack of liquidity in underlying markets, changes in the applicable interest rates, the","page_number":72,"box":{"x":68,"y":143,"width":748,"height":11}},{"id":"fb9df200-5c5a-4ca2-a685-91ed70cc269e","block_type":"box","text":"per formance of the reference instrument, changes in the issuer’s credit rating and economic, legal, political or","page_number":72,"box":{"x":70,"y":158,"width":789,"height":11}},{"id":"6ec013e4-82ad-4a52-b2e6-2617eb8fd04f","block_type":"box","text":"geographic events that affect the reference instrument. ETNs are subject to credit risk and the value of the ETN may","page_number":72,"box":{"x":68,"y":173,"width":831,"height":11}},{"id":"24199d41-3d13-4bf4-a509-75f065ef6c03","block_type":"box","text":"drop due to a downgrade in an issuer’s credit rating, despite the underlying reference instrument remaining","page_number":72,"box":{"x":69,"y":188,"width":766,"height":12}},{"id":"9acfbf4a-2b10-48ee-881f-c87373ce0a78","block_type":"box","text":"unchanged. When a Fund invests in ETNs, it will bear its propor tionate share of any fees and expenses borne by the","page_number":72,"box":{"x":69,"y":203,"width":828,"height":12}},{"id":"dfab0ee8-6bcc-4bcf-92fe-5ee80a2a05ca","block_type":"box","text":"ETN.","page_number":72,"box":{"x":70,"y":219,"width":30,"height":8}},{"id":"7b54f2d5-f4b9-4d0b-92ea-0cf1c249e768","block_type":"box","text":"An ETN that is tied to a reference instrument may not replicate the per formance of the reference instrument.","page_number":72,"box":{"x":101,"y":241,"width":776,"height":11}},{"id":"d3975e36-fc09-472e-89a1-0c6906f4e3e5","block_type":"box","text":"ETNs also incur cer tain expenses not incurred by their applicable reference instrument. Some ETNs that use leverage","page_number":72,"box":{"x":70,"y":256,"width":837,"height":12}},{"id":"d952bcc6-51d0-4e2d-ad8c-c3352d256954","block_type":"box","text":"may, at times, be illiquid and may be difficult to purchase or sell at a fair price. Levered ETNs are subject to the same","page_number":72,"box":{"x":69,"y":271,"width":840,"height":12}},{"id":"d30d0843-dcf0-4568-b8a6-e9959a3aad10","block_type":"box","text":"risk as other instruments that use leverage in any form. While leverage allows for greater potential return, the","page_number":72,"box":{"x":69,"y":286,"width":781,"height":12}},{"id":"25c54931-155c-4838-81a4-d79300c46bfc","block_type":"box","text":"potential for loss is also greater. Finally, additional losses may be incurred if the investment loses value because, in","page_number":72,"box":{"x":70,"y":302,"width":827,"height":11}},{"id":"bfa344b3-7d66-4f5e-a179-1c1819826ba4","block_type":"box","text":"addition to the money lost on the investment, the loan still needs to be repaid.","page_number":72,"box":{"x":69,"y":317,"width":560,"height":11}},{"id":"c90fa9b5-9944-4102-83f5-7ddbe8998927","block_type":"box","text":"Because the return on the ETN is dependent on the issuer’s ability or willingness to meet its obligations, the","page_number":72,"box":{"x":102,"y":340,"width":774,"height":11}},{"id":"efd3f884-ae1b-4e6c-88dc-1b876ae25c61","block_type":"box","text":"value of the ETN may change due to a change in the issuer’s credit rating, despite no change in the underlying","page_number":72,"box":{"x":68,"y":355,"width":788,"height":11}},{"id":"6b94ed77-ae7c-4210-8e2f-180845dbbd2e","block_type":"box","text":"reference instrument. The market value of ETN shares may differ from the value of the reference instrument. This","page_number":72,"box":{"x":69,"y":370,"width":810,"height":11}},{"id":"a3fe88a6-ed5f-4db4-b32e-a5298950447b","block_type":"box","text":"difference in price may be due to the fact that the supply and demand in the market for ETN shares at any point in","page_number":72,"box":{"x":69,"y":385,"width":815,"height":11}},{"id":"673192ac-e970-4b55-b354-15333bc4b5dc","block_type":"box","text":"time is not always identical to the supply and demand in the market for the assets underlying the reference","page_number":72,"box":{"x":68,"y":400,"width":766,"height":11}},{"id":"dc1c7b9a-fd4e-4b3f-8fca-75ab1200af8e","block_type":"box","text":"instrument that the ETN seeks to track.","page_number":72,"box":{"x":70,"y":415,"width":279,"height":9}},{"id":"0019a899-a92d-421d-b24d-67f9212cbb29","block_type":"box","text":"There may be restrictions on the Fund’s right to redeem its investment in an ETN, which are generally meant to","page_number":72,"box":{"x":101,"y":438,"width":791,"height":11}},{"id":"20a14a1e-f92d-4167-aeb8-2d862250a553","block_type":"box","text":"be held until maturity. The Fund’s decision to sell its ETN holdings may be limited by the availability of a secondary","page_number":72,"box":{"x":69,"y":453,"width":818,"height":11}},{"id":"1a3bd5a6-8d09-462f-a0c1-0ccabb768fac","block_type":"box","text":"market. An investor in an ETN could lose some or all of the amount invested.","page_number":72,"box":{"x":69,"y":468,"width":547,"height":9}},{"id":"5c56d263-12d6-4ceb-8a1f-14ea5dd125fa","block_type":"box","text":"ETNs are also subject to tax risks. The Internal Revenue Service (the “IRS”) may not accept, and a cour t may not","page_number":72,"box":{"x":102,"y":491,"width":807,"height":11}},{"id":"2715a254-6a61-4cbf-a34b-416fb1cd2194","block_type":"box","text":"uphold, how the Funds characterize and treat ETNs for tax purposes. The timing and character of income and gains","page_number":72,"box":{"x":69,"y":506,"width":819,"height":11}},{"id":"a1360279-8edf-4948-9a61-bdde8b75cd35","block_type":"box","text":"derived by a Fund from investments in ETNs may be affected by future legislation.","page_number":72,"box":{"x":69,"y":521,"width":581,"height":11}},{"id":"f4c80ea2-d6d5-45df-98a7-0a5c888130df","block_type":"box","text":"Foreign Investments.","page_number":72,"box":{"x":102,"y":544,"width":152,"height":11}},{"id":"f51f9312-9192-44b9-b7bc-9f1e941c5f91","block_type":"box","text":"Foreign Investment Risks.","page_number":72,"box":{"x":102,"y":566,"width":182,"height":11}},{"id":"bcd1edba-99ae-456e-b622-ebcce63be020","block_type":"box","text":"Cer tain Funds may invest in foreign securities, including securities from issuers","page_number":72,"box":{"x":291,"y":566,"width":567,"height":11}},{"id":"9fd9ccba-753b-4b26-af72-0c88905ef418","block_type":"box","text":"located in emerging market countries. These securities may be denominated in U.S. dollars or in a foreign currency.","page_number":72,"box":{"x":70,"y":581,"width":822,"height":12}},{"id":"9b0282f8-6a7f-4bc5-ae3c-7a002f2b2f06","block_type":"box","text":"Investing in foreign securities involves risks not typically associated with investing in securities of companies","page_number":72,"box":{"x":70,"y":596,"width":774,"height":12}},{"id":"bf169460-100e-4cb5-b98f-82fc08867ddd","block_type":"box","text":"organized and operated in the United States that can increase the chances that a Fund will lose money.","page_number":72,"box":{"x":69,"y":612,"width":738,"height":11}},{"id":"0727e4a3-622f-4dea-bd28-5305e2ee67d7","block_type":"box","text":"Securities issued by cer tain companies organized outside the United States may not be deemed to be foreign","page_number":72,"box":{"x":102,"y":634,"width":782,"height":12}},{"id":"24d83237-b2cd-435c-9a6b-2f4cfe5ad076","block_type":"box","text":"securities (but rather deemed to be U.S. securities) if (i) the company’s principal operations are conducted from the","page_number":72,"box":{"x":69,"y":649,"width":824,"height":12}},{"id":"eb1b7fb0-9935-4c5c-8faa-ee323e7b9263","block_type":"box","text":"U.S., (ii) the company’s equity securities trade principally on a U.S. stock exchange, (iii) the company does a","page_number":72,"box":{"x":70,"y":665,"width":771,"height":11}},{"id":"f95e9159-7d36-4c22-91ba-8ff97fa5ddd8","block_type":"box","text":"substantial amount of business in the U.S. or (iv) the issuer of securities is included in the Fund’s primary U.S.","page_number":72,"box":{"x":69,"y":680,"width":792,"height":11}},{"id":"92c6f9a6-6174-4974-9a9e-0baa3711bb22","block_type":"box","text":"benchmark index.","page_number":72,"box":{"x":69,"y":695,"width":124,"height":9}},{"id":"b6cbe002-038e-40d7-8a37-5276bd263e38","block_type":"box","text":"In addition to equity securities, foreign investments of the Funds may include: (a) debt obligations issued or","page_number":72,"box":{"x":102,"y":717,"width":767,"height":12}},{"id":"38f84260-5ee1-40d3-86a4-f6fde7136d59","block_type":"box","text":"guaranteed by foreign sovereign governments or their agencies, authorities, instrumentalities or political","page_number":72,"box":{"x":68,"y":732,"width":742,"height":12}},{"id":"6fb53bc2-5446-4a25-8c7e-0f0be3d1f662","block_type":"box","text":"subdivisions, including a foreign state, province or municipality; (b) debt obligations of supranational organizations;","page_number":72,"box":{"x":69,"y":748,"width":818,"height":11}},{"id":"7630648e-99a1-44d8-adca-8557b3dbc1bb","block_type":"box","text":"(c) debt obligations of foreign banks and bank holding companies; (d) debt obligations of domestic banks and","page_number":72,"box":{"x":69,"y":763,"width":780,"height":11}},{"id":"bca3600d-0de9-4aa4-856f-f0e4173dde3a","block_type":"box","text":"corporations issued in foreign currencies; (e) debt obligations denominated in the Euro; and (f) foreign corporate debt","page_number":72,"box":{"x":69,"y":778,"width":837,"height":11}},{"id":"1d6c27dc-e2bd-4c95-b8cd-3a13e75c2bf5","block_type":"box","text":"securities and commercial paper. Such securities may include loan par ticipations and assignments, conver tible","page_number":72,"box":{"x":69,"y":793,"width":794,"height":11}},{"id":"bfe9eec3-a0a4-4797-bef0-39a0754a73cb","block_type":"box","text":"securities and zero-coupon securities.","page_number":72,"box":{"x":69,"y":808,"width":268,"height":11}},{"id":"d237e375-0ef8-4e45-b136-432ffd2a932f","block_type":"box","text":"Dividends or interest on, or proceeds from the sale of, foreign securities may be subject to foreign withholding","page_number":72,"box":{"x":102,"y":831,"width":785,"height":11}},{"id":"0acab175-b51c-4e70-9668-2ed0fe5be5f1","block_type":"box","text":"taxes.","page_number":72,"box":{"x":68,"y":847,"width":42,"height":8}},{"id":"d39b7020-7f37-401d-a47f-a8ebbfb6a080","block_type":"box","text":"To the extent that the underlying securities or other instruments held by a Fund trade on foreign exchanges or in","page_number":72,"box":{"x":101,"y":869,"width":798,"height":11}},{"id":"09c95233-16ad-4ce6-ab45-afc8a3f9b8cb","block_type":"box","text":"foreign markets that are closed when the securities exchange on which the Fund’s shares trade is open, there are","page_number":72,"box":{"x":68,"y":884,"width":815,"height":11}},{"id":"49f91084-99fd-4cc5-8a16-8452e48c86ca","block_type":"box","text":"likely to be deviations between the current price of such an underlying security and the last quoted price for the","page_number":72,"box":{"x":70,"y":899,"width":792,"height":11}},{"id":"4ec21416-d3af-4eca-a08b-4fe74d567b16","block_type":"box","text":"II-28","page_number":72,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"045a4bc1-1892-4ac2-ac59-b00f77747901","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":72,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"62779a3e-9d5b-4ec6-a68f-39e0deb8c321","block_type":"box","text":"underlying security (","page_number":73,"box":{"x":69,"y":45,"width":140,"height":11}},{"id":"d20bfca2-0f58-4c5a-a20d-7ed79ff7beeb","block_type":"box","text":"i.e.","page_number":73,"box":{"x":211,"y":45,"width":20,"height":9}},{"id":"c79ebfd7-24e7-4694-801d-cc1378582082","block_type":"box","text":", the Fund’s quote from the closed foreign market). The impact of a closed foreign market on a","page_number":73,"box":{"x":234,"y":45,"width":675,"height":11}},{"id":"fa301a97-b7cf-4c34-954b-050b373e1a0d","block_type":"box","text":"Fund is likely to be greater where a large por tion of the Fund’s underlying securities or other instruments trade on","page_number":73,"box":{"x":70,"y":60,"width":809,"height":11}},{"id":"59704692-adee-4bb5-985d-366b998b9ad1","block_type":"box","text":"that closed foreign market or when the foreign market is closed for unscheduled reasons. These deviations may","page_number":73,"box":{"x":68,"y":75,"width":800,"height":11}},{"id":"06ca9757-62b2-4d99-88d5-c3242de41bf4","block_type":"box","text":"result in premiums or discounts to cer tain Funds’ NAVs that may be greater than those experienced by other ETFs.","page_number":73,"box":{"x":69,"y":90,"width":815,"height":11}},{"id":"94a363cf-1e7d-446c-a241-398a21e8a943","block_type":"box","text":"Foreign Market Risk.","page_number":73,"box":{"x":102,"y":113,"width":144,"height":11}},{"id":"f544d7a3-7f1d-4cbc-85dd-66a4a4e305ab","block_type":"box","text":"Funds that may invest in foreign securities offer the potential for more diversification than a","page_number":73,"box":{"x":254,"y":113,"width":652,"height":11}},{"id":"6c61f5b8-487f-48bd-b663-49c072de1ffb","block_type":"box","text":"Fund that invests only in the United States because securities traded on foreign markets have often (though not","page_number":73,"box":{"x":70,"y":128,"width":797,"height":11}},{"id":"bd0aa2ae-8708-4b38-99ed-b077faa78f68","block_type":"box","text":"always) per formed differently from securities traded in the United States. However, such investments often involve","page_number":73,"box":{"x":69,"y":143,"width":817,"height":11}},{"id":"8c3fbc49-374a-491b-9e22-175b8034854b","block_type":"box","text":"risks not present in U.S. investments that can increase the chances that a Fund will lose money. In par ticular, a Fund","page_number":73,"box":{"x":69,"y":158,"width":836,"height":11}},{"id":"0f7a9668-ac15-45e4-a5d9-65b3f5ca33f0","block_type":"box","text":"is subject to the risk that, because there are generally fewer investors on foreign exchanges and a smaller number of","page_number":73,"box":{"x":70,"y":173,"width":835,"height":11}},{"id":"06d0b2f5-a6cd-464f-9070-5397536d378e","block_type":"box","text":"shares traded each day, it may be difficult for the Fund to buy and sell securities on those exchanges. In addition,","page_number":73,"box":{"x":69,"y":188,"width":810,"height":12}},{"id":"2661f076-3798-49cb-a801-ae66a1998c23","block_type":"box","text":"prices of foreign securities may fluctuate more than prices of securities traded in the United States. Investments in","page_number":73,"box":{"x":70,"y":203,"width":820,"height":12}},{"id":"c8be43f9-72c1-415e-87d0-c099393a3ffd","block_type":"box","text":"foreign markets may also be adversely affected by governmental actions such as the imposition of punitive taxes or","page_number":73,"box":{"x":68,"y":218,"width":826,"height":12}},{"id":"4616fc90-598a-47e9-a406-7951c08afd30","block_type":"box","text":"tariffs. In addition, economic conditions, such as volatile currency exchange rates and interest rates, political events,","page_number":73,"box":{"x":68,"y":234,"width":836,"height":11}},{"id":"a053f6d2-a4da-40d5-b20a-fc7645f1d82f","block_type":"box","text":"military action and other conditions may, without prior warning, lead to the governments of cer tain countries, or the","page_number":73,"box":{"x":69,"y":249,"width":821,"height":11}},{"id":"ccb6ba4a-870c-4c8b-99ab-7e7258faf809","block_type":"box","text":"U.S. Government with respect to cer tain countries, prohibiting or imposing substantial restrictions through capital","page_number":73,"box":{"x":70,"y":264,"width":807,"height":11}},{"id":"bcb4f758-2fe1-47e5-a703-07673215426a","block_type":"box","text":"controls and/or sanctions on foreign investing in the capital markets or cer tain industries in those countries. Capital","page_number":73,"box":{"x":69,"y":279,"width":830,"height":11}},{"id":"9c087d81-cfee-45e8-9e6a-1983df48b0be","block_type":"box","text":"controls and/or sanctions may include the prohibition of, or restrictions on, the ability to own or transfer currency,","page_number":73,"box":{"x":69,"y":294,"width":810,"height":11}},{"id":"2c8a9368-8bd7-431d-8b03-c84aa5ebb9de","block_type":"box","text":"securities, derivatives or other assets and may also include retaliatory actions of one government against another","page_number":73,"box":{"x":69,"y":309,"width":813,"height":11}},{"id":"31109f58-104c-4bb4-82c3-f7309624c073","block_type":"box","text":"government, such as seizure of assets. Any of these actions could severely impair a Fund’s ability to purchase, sell,","page_number":73,"box":{"x":68,"y":324,"width":828,"height":12}},{"id":"41ea7677-5de3-44d1-9896-aee5a0219d28","block_type":"box","text":"transfer, receive, deliver or otherwise obtain exposure to foreign securities and assets, including the ability to","page_number":73,"box":{"x":68,"y":339,"width":782,"height":12}},{"id":"11ef92b1-4e78-43ef-b27d-47ddc733f12a","block_type":"box","text":"transfer the Fund’s assets or income back into the United States, and could negatively impact the value and/or","page_number":73,"box":{"x":68,"y":355,"width":796,"height":11}},{"id":"4a863eb6-79b3-4095-b380-5499deb2b6bc","block_type":"box","text":"liquidity of such assets or otherwise adversely affect a Fund’s operations, causing the Fund to decline in value. Other","page_number":73,"box":{"x":70,"y":370,"width":837,"height":11}},{"id":"89602647-a08e-4419-814c-d2d2586d6b31","block_type":"box","text":"potential foreign market risks include exchange controls, difficulties in pricing securities, defaults on foreign","page_number":73,"box":{"x":70,"y":385,"width":768,"height":11}},{"id":"8d748b4c-46c7-4be8-8062-b67a3f46161b","block_type":"box","text":"government securities, difficulties in enforcing favorable legal judgments in foreign cour ts, and political and social","page_number":73,"box":{"x":68,"y":400,"width":813,"height":11}},{"id":"8e6e09cd-d1ec-44a7-abfe-5cdfdbeab578","block_type":"box","text":"conditions, such as diplomatic relations, confiscatory taxation, expropriation, limitation on the removal of funds or","page_number":73,"box":{"x":69,"y":415,"width":814,"height":11}},{"id":"5da4686b-29be-4a8d-8ea1-684def4df7ed","block_type":"box","text":"assets, or imposition of (or change in) exchange control regulations. Legal remedies available to investors in cer tain","page_number":73,"box":{"x":69,"y":430,"width":828,"height":11}},{"id":"bfdb6179-4f62-4c32-9975-6228881570cf","block_type":"box","text":"foreign countries may be less extensive than those available to investors in the United States or other foreign","page_number":73,"box":{"x":68,"y":445,"width":782,"height":12}},{"id":"963303af-c541-49f1-82d8-8de6c6e333d5","block_type":"box","text":"countries. In addition, changes in government administrations or economic or monetary policies in the United States","page_number":73,"box":{"x":69,"y":460,"width":830,"height":12}},{"id":"d8619ab0-78ec-4651-a9e5-cbbd8e82e85e","block_type":"box","text":"or abroad could result in appreciation or depreciation of por tfolio securities and could favorably or adversely affect a","page_number":73,"box":{"x":69,"y":475,"width":829,"height":12}},{"id":"0f49dcff-5044-467d-8a3b-cdd1467c4c52","block_type":"box","text":"Fund’s operations.","page_number":73,"box":{"x":70,"y":491,"width":130,"height":11}},{"id":"27cbf3d1-896c-40cd-bc54-e14c0c511383","block_type":"box","text":"Foreign Economy Risk.","page_number":73,"box":{"x":102,"y":514,"width":158,"height":11}},{"id":"e170d07b-abbb-48ee-9926-1d9f89161858","block_type":"box","text":"The economies of cer tain foreign markets often do not compare favorably with that of the","page_number":73,"box":{"x":267,"y":513,"width":636,"height":12}},{"id":"f34703e3-abf4-4e8a-bab8-22ad202d389d","block_type":"box","text":"United States with respect to such issues as growth of gross national product, reinvestment of capital, resources,","page_number":73,"box":{"x":70,"y":528,"width":812,"height":12}},{"id":"94a105c9-a9fa-43b6-b079-9e99d7c6178d","block_type":"box","text":"and balance of payments position. Cer tain such economies may rely heavily on par ticular industries or foreign capital","page_number":73,"box":{"x":69,"y":543,"width":835,"height":12}},{"id":"09aced50-5d99-493e-bbb2-582c5a6c33c7","block_type":"box","text":"and are more vulnerable to diplomatic developments, the imposition of economic sanctions against a par ticular","page_number":73,"box":{"x":69,"y":559,"width":795,"height":11}},{"id":"b02ebddb-9f07-4de8-bc7e-159a25b9c7bf","block_type":"box","text":"country or countries, changes in international trading patterns, trade barriers, and other protectionist or retaliatory","page_number":73,"box":{"x":69,"y":574,"width":817,"height":11}},{"id":"0a076658-7555-4075-84c9-db9419dd7711","block_type":"box","text":"measures.","page_number":73,"box":{"x":69,"y":591,"width":74,"height":7}},{"id":"bdb6f6a3-c592-4321-97b6-6513a3e0add9","block_type":"box","text":"Currency Risk and Exchange Risk.","page_number":73,"box":{"x":102,"y":612,"width":240,"height":11}},{"id":"c82e0e87-7eef-4c21-ad4a-9eea980db687","block_type":"box","text":"Because foreign securities generally are denominated and pay dividends or","page_number":73,"box":{"x":349,"y":612,"width":534,"height":11}},{"id":"e56998fe-642d-4aa7-b387-11d195ac3634","block_type":"box","text":"interest in foreign currencies, the value of a Fund that invests in foreign securities as measured in U.S. dollars will be","page_number":73,"box":{"x":70,"y":627,"width":838,"height":11}},{"id":"aaab82e6-4dd5-49b8-a35d-658afb8e0b2b","block_type":"box","text":"affected favorably or unfavorably by changes in exchange rates. Generally, when the U.S. dollar rises in value against","page_number":73,"box":{"x":69,"y":642,"width":833,"height":11}},{"id":"8146d96a-4445-43cb-aab0-406c18b604cf","block_type":"box","text":"a foreign currency, a security denominated in that currency loses value because the currency is wor th fewer U.S.","page_number":73,"box":{"x":69,"y":657,"width":801,"height":11}},{"id":"b0b1e269-4e8a-4b5a-a3cc-e41270790f22","block_type":"box","text":"dollars. Conversely, when the U.S. dollar decreases in value against a foreign currency, a security denominated in","page_number":73,"box":{"x":69,"y":672,"width":808,"height":11}},{"id":"ed928bfc-ad14-475a-a176-5c6273a021fe","block_type":"box","text":"that currency gains value because the currency is wor th more U.S. dollars. This risk, generally known as “currency","page_number":73,"box":{"x":68,"y":687,"width":816,"height":11}},{"id":"1ba117b0-8c6b-4429-8b4d-89d1902589fe","block_type":"box","text":"risk,” means that a stronger U.S. dollar will reduce returns for U.S. investors while a weak U.S. dollar will increase","page_number":73,"box":{"x":69,"y":702,"width":814,"height":12}},{"id":"19fe3fb9-591f-41cb-87a9-6cee51fbfc66","block_type":"box","text":"those returns. Currency exchange rates can also be affected unpredictably by intervention by U.S. or foreign","page_number":73,"box":{"x":68,"y":717,"width":771,"height":12}},{"id":"706f1efd-a4fc-4966-94af-11954bf78ecc","block_type":"box","text":"governments or central banks, or the failure to intervene, or buy currency controls or political developments in the","page_number":73,"box":{"x":68,"y":732,"width":813,"height":12}},{"id":"50526ab4-f111-4d09-a025-b1a9c0f10748","block_type":"box","text":"United States or abroad.","page_number":73,"box":{"x":70,"y":748,"width":172,"height":9}},{"id":"81d408e6-373c-4d29-99d5-68b42f0fd2ff","block_type":"box","text":"Governmental Supervision and Regulation/Accounting Standards.","page_number":73,"box":{"x":102,"y":770,"width":466,"height":12}},{"id":"8850a498-c1e0-4b02-881a-31957786b632","block_type":"box","text":"Many foreign governments supervise and","page_number":73,"box":{"x":575,"y":770,"width":293,"height":12}},{"id":"12007aeb-17ef-4937-bac8-fbb9ec225a2f","block_type":"box","text":"regulate stock exchanges, brokers and the sale of securities less than does the United States. Some countries may","page_number":73,"box":{"x":69,"y":785,"width":828,"height":12}},{"id":"f4e550af-dd71-44ff-af80-d6c7dd18a7b8","block_type":"box","text":"not have laws to protect investors comparable to the U.S. securities laws. For example, some foreign countries may","page_number":73,"box":{"x":69,"y":801,"width":826,"height":11}},{"id":"70f349d7-983d-4a81-b570-6ce9a475d6ee","block_type":"box","text":"have no laws or rules against insider trading. Insider trading occurs when a person buys or sells a company’s","page_number":73,"box":{"x":69,"y":816,"width":778,"height":11}},{"id":"71046580-0658-4956-94e2-2f30613ece6f","block_type":"box","text":"securities based on nonpublic information about that company. Accounting standards in other countries are not","page_number":73,"box":{"x":69,"y":831,"width":794,"height":11}},{"id":"b5a6cbf6-49a4-4c11-b86a-a13f7f6d9c9e","block_type":"box","text":"necessarily the same as in the United States. If the accounting standards in another country do not require as much","page_number":73,"box":{"x":69,"y":846,"width":831,"height":11}},{"id":"d9979a41-db9b-4820-9504-dfbd2e96514c","block_type":"box","text":"detail as U.S. accounting standards, it may be harder for Fund management to completely and accurately determine a","page_number":73,"box":{"x":69,"y":861,"width":840,"height":11}},{"id":"9a463fcb-bf89-4e7b-b76a-dc3f99076320","block_type":"box","text":"company’s financial condition. In addition, the U.S. Government has from time to time in the past imposed","page_number":73,"box":{"x":69,"y":876,"width":760,"height":11}},{"id":"99ec0c49-0e40-476f-8bd9-ade24598ca52","block_type":"box","text":"restrictions, through penalties and otherwise, on foreign investments by U.S. investors such as the Fund. If such","page_number":73,"box":{"x":69,"y":891,"width":803,"height":12}},{"id":"de2e525d-a115-4757-8bfd-95d46410700f","block_type":"box","text":"restrictions should be reinstituted, it might become necessary for the Fund to invest all or substantially all of its","page_number":73,"box":{"x":69,"y":906,"width":798,"height":12}},{"id":"a1ae9751-d4e5-4063-9aed-1353739b88f3","block_type":"box","text":"II-29","page_number":73,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"52846e8e-e290-48cf-b28b-e31f652fc670","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":73,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"7a5f6405-efe8-462f-9152-3bce48164500","block_type":"box","text":"assets in U.S. securities. Also, brokerage commissions and other costs of buying or selling securities often are","page_number":74,"box":{"x":69,"y":45,"width":793,"height":11}},{"id":"c194380b-8d66-4208-92b0-edc4cdd8e879","block_type":"box","text":"higher in foreign countries than they are in the United States. This reduces the amount the Fund can earn on its","page_number":74,"box":{"x":69,"y":60,"width":797,"height":11}},{"id":"0249fa20-db38-4766-8574-344613d7898e","block_type":"box","text":"investments.","page_number":74,"box":{"x":70,"y":75,"width":89,"height":9}},{"id":"20f80ee4-38b0-42f4-a9d9-8971e7ee3616","block_type":"box","text":"Cer tain Risks of Holding Fund Assets Outside the United States.","page_number":74,"box":{"x":102,"y":98,"width":458,"height":11}},{"id":"201fa07b-d27b-4132-8845-d24cdc623a56","block_type":"box","text":"A Fund generally holds its foreign securities and","page_number":74,"box":{"x":566,"y":98,"width":341,"height":11}},{"id":"7b0f9103-aec2-4152-baa8-123302be2cfb","block_type":"box","text":"cash in foreign banks and securities depositories. Some foreign banks and securities depositories may be recently","page_number":74,"box":{"x":69,"y":113,"width":819,"height":11}},{"id":"bffe19a9-dafa-49d8-9cdc-bd303916fe1a","block_type":"box","text":"organized or new to the foreign custody business. In addition, there may be limited or no regulatory oversight over","page_number":74,"box":{"x":69,"y":128,"width":813,"height":11}},{"id":"8b839632-64dc-45c3-8d9d-e32d812a87fe","block_type":"box","text":"their operations. Also, the laws of cer tain countries may put limits on a Fund’s ability to recover its assets if a foreign","page_number":74,"box":{"x":68,"y":143,"width":838,"height":11}},{"id":"9ad44a5c-ca43-497d-a6e5-4d254cfc40b1","block_type":"box","text":"bank or depository or issuer of a security or any of their agents goes bankrupt. In addition, it is often more expensive","page_number":74,"box":{"x":69,"y":158,"width":835,"height":11}},{"id":"6f435f02-1a9f-4e12-b064-1d0e63a2b776","block_type":"box","text":"for a Fund to buy, sell and hold securities in cer tain foreign markets than in the United States. The increased","page_number":74,"box":{"x":68,"y":173,"width":777,"height":11}},{"id":"46a3f6b6-abdc-428f-b5d8-0b55c4a470e5","block_type":"box","text":"expense of investing in foreign markets reduces the amount a Fund can earn on its investments and typically results","page_number":74,"box":{"x":69,"y":188,"width":831,"height":12}},{"id":"f88c562e-302c-4db0-bf5e-eb33d8194977","block_type":"box","text":"in a higher operating expense ratio for the Fund as compared to investment companies that invest only in the United","page_number":74,"box":{"x":70,"y":203,"width":828,"height":12}},{"id":"aca297c9-ef8d-4ff7-ba0e-140d2da74ba1","block_type":"box","text":"States.","page_number":74,"box":{"x":69,"y":219,"width":49,"height":8}},{"id":"acbd1ee7-0d71-4df0-93c9-1c7c34f8cc71","block_type":"box","text":"Publicly Available Information.","page_number":74,"box":{"x":102,"y":241,"width":210,"height":11}},{"id":"d8317128-71aa-4503-8901-dc45ad664af6","block_type":"box","text":"In general, less information is publicly available with respect to foreign issuers","page_number":74,"box":{"x":319,"y":241,"width":558,"height":11}},{"id":"518ef03d-88bb-4621-8279-ec483c1f6d89","block_type":"box","text":"than is available with respect to U.S. companies. Most foreign companies are also not subject to the uniform","page_number":74,"box":{"x":68,"y":256,"width":779,"height":12}},{"id":"697dcdcd-306c-470f-9923-0a2cfb828e93","block_type":"box","text":"accounting and financial repor ting requirements applicable to issuers in the United States. While the volume of","page_number":74,"box":{"x":69,"y":271,"width":793,"height":12}},{"id":"031d70c9-c25f-42e7-a9ee-f0c4f67cf47c","block_type":"box","text":"transactions effected on foreign stock exchanges has increased in recent years, it remains appreciably below that of","page_number":74,"box":{"x":68,"y":286,"width":834,"height":12}},{"id":"3c5c1695-5c24-4094-90be-54c917a846f4","block_type":"box","text":"the New York Stock Exchange. Accordingly, a Fund’s foreign investments may be less liquid than, and their prices may","page_number":74,"box":{"x":68,"y":302,"width":841,"height":11}},{"id":"7eb0730d-f3a8-4e36-8d8f-44d8bec94d1b","block_type":"box","text":"be more volatile than, comparable investments in securities in U.S. companies. In addition, there is generally less","page_number":74,"box":{"x":69,"y":317,"width":813,"height":11}},{"id":"15235991-7184-458f-a833-243bbe0e502e","block_type":"box","text":"government supervision and regulation of securities exchanges, brokers and issuers in foreign countries than in the","page_number":74,"box":{"x":68,"y":332,"width":827,"height":11}},{"id":"2ea20fe9-d360-4146-bf47-923747b008ee","block_type":"box","text":"United States.","page_number":74,"box":{"x":70,"y":347,"width":99,"height":9}},{"id":"8f17902e-6bf2-4754-8db7-46bb4f1c1843","block_type":"box","text":"Settlement Risk.","page_number":74,"box":{"x":102,"y":370,"width":116,"height":9}},{"id":"f75f40d3-4648-4d2b-9811-bd8879b53f79","block_type":"box","text":"Settlement and clearance procedures in cer tain foreign markets differ significantly from those","page_number":74,"box":{"x":225,"y":370,"width":669,"height":11}},{"id":"87bdcd9c-4a99-459b-96b2-1895c9c0a2d4","block_type":"box","text":"in the United States. Supervisory authorities may also be unable to apply standards which are comparable with those","page_number":74,"box":{"x":70,"y":385,"width":837,"height":11}},{"id":"7bedae58-1bc1-4c17-9300-4e836a31ffa7","block_type":"box","text":"in the United States. Foreign settlement procedures and trade regulations also may involve cer tain risks (such as","page_number":74,"box":{"x":70,"y":400,"width":808,"height":11}},{"id":"69fb69ef-5762-4103-9102-bed614ef1b3b","block_type":"box","text":"delays in payment for or delivery of securities) not typically generated by the settlement of U.S. investments.","page_number":74,"box":{"x":69,"y":415,"width":772,"height":11}},{"id":"578603f8-137f-40ef-97f8-de06d0f9ada4","block_type":"box","text":"Communications between the United States and emerging market countries may be unreliable, increasing the","page_number":74,"box":{"x":102,"y":438,"width":781,"height":11}},{"id":"b9eafb89-1d55-486b-b2bf-4e9cec14b17e","block_type":"box","text":"risk of delayed settlements or losses of security cer tificates in markets that still rely on physical settlement.","page_number":74,"box":{"x":69,"y":453,"width":771,"height":11}},{"id":"0cfecfad-a7ef-4cb7-99d8-931b6535876d","block_type":"box","text":"Settlements in cer tain foreign countries at times have not kept pace with the number of securities transactions;","page_number":74,"box":{"x":69,"y":468,"width":797,"height":11}},{"id":"4935bf05-7b6c-4360-bcd7-81c4a6e182b4","block_type":"box","text":"these problems may make it difficult for a Fund to carry out transactions. If a Fund cannot settle or is delayed in","page_number":74,"box":{"x":68,"y":483,"width":802,"height":11}},{"id":"42980ff7-1f90-4d92-9bc0-1100a56c10a5","block_type":"box","text":"settling a purchase of securities, it may miss attractive investment oppor tunities and cer tain of its assets may be","page_number":74,"box":{"x":69,"y":498,"width":812,"height":11}},{"id":"3f193ffb-6cab-490c-91c8-790d20e730b9","block_type":"box","text":"uninvested with no return earned thereon for some period. If a Fund cannot settle or is delayed in settling a sale of","page_number":74,"box":{"x":69,"y":513,"width":821,"height":12}},{"id":"7ca1c727-53ca-4bc4-9bbb-7e932c726b7c","block_type":"box","text":"securities, it may lose money if the value of the security then declines or, if it has contracted to sell the security to","page_number":74,"box":{"x":69,"y":528,"width":816,"height":12}},{"id":"6ad6a3c8-b54c-4abc-b3e2-24f57cb35c79","block_type":"box","text":"another par ty, the Fund could be liable to that par ty for any losses incurred.","page_number":74,"box":{"x":69,"y":543,"width":539,"height":12}},{"id":"88734e8a-4969-4415-94b0-9a48ddcc9753","block_type":"box","text":"Because of uncer tainties in the operation of settlement systems in individual markets, competing claims may","page_number":74,"box":{"x":102,"y":566,"width":781,"height":11}},{"id":"340998ac-b42a-4f66-82b1-dc975282c1ad","block_type":"box","text":"arise in respect of securities held by or to be transferred to a Fund. Compensation schemes may not exist or may","page_number":74,"box":{"x":69,"y":581,"width":810,"height":11}},{"id":"87162e15-6318-4faf-8ea9-57ad5042ede4","block_type":"box","text":"otherwise be limited or inadequate to meet the Fund’s claims in case of such event.","page_number":74,"box":{"x":69,"y":596,"width":601,"height":11}},{"id":"0b2853fb-5922-43b8-81ec-de273f307de1","block_type":"box","text":"Sovereign Debt.","page_number":74,"box":{"x":102,"y":619,"width":111,"height":11}},{"id":"2d08dd97-6102-4c4d-97e1-76421c7ad03c","block_type":"box","text":"Investment in sovereign debt can involve a high degree of risk. The governmental entity that","page_number":74,"box":{"x":221,"y":619,"width":653,"height":11}},{"id":"8b063604-932b-49ec-b91c-0b763a498909","block_type":"box","text":"controls the repayment of sovereign debt may not be able or willing to repay the principal and/or interest when due in","page_number":74,"box":{"x":69,"y":634,"width":837,"height":12}},{"id":"64f255fd-d026-4906-b8e8-0ef399264466","block_type":"box","text":"accordance with the terms of such debt. A governmental entity’s willingness or ability to repay principal and interest","page_number":74,"box":{"x":69,"y":649,"width":826,"height":12}},{"id":"c56100dd-daa4-487e-a5cc-8bdaace8c655","block_type":"box","text":"due in a timely manner may be affected by, among other factors, its cash flow situation, the extent of its foreign","page_number":74,"box":{"x":69,"y":664,"width":798,"height":12}},{"id":"0c27de4f-b818-460f-a91e-5bfeb636ce6e","block_type":"box","text":"reserves, the availability of sufficient foreign exchange on the date a payment is due, the relative size of the debt","page_number":74,"box":{"x":69,"y":680,"width":809,"height":11}},{"id":"36566404-bcd9-4bbe-adbc-c03671dac15c","block_type":"box","text":"service burden to the economy as a whole, the governmental entity’s policy towards the International Monetary Fund","page_number":74,"box":{"x":69,"y":695,"width":832,"height":11}},{"id":"902259e0-09e0-4a0a-a64a-a2536eef6c4d","block_type":"box","text":"and the political constraints to which a governmental entity may be subject. Governmental entities may also be","page_number":74,"box":{"x":69,"y":710,"width":790,"height":11}},{"id":"20d2aed2-bfff-4ef3-8ede-625ab7545d1f","block_type":"box","text":"dependent on expected disbursements from foreign governments, multilateral agencies and others abroad to reduce","page_number":74,"box":{"x":69,"y":725,"width":831,"height":11}},{"id":"37ce1649-5d7a-43d8-8fb7-01714b73b640","block_type":"box","text":"principal and interest arrearages on their debt. The commitment on the par t of these governments, agencies and","page_number":74,"box":{"x":70,"y":740,"width":805,"height":11}},{"id":"40a14206-8d55-468a-aff7-526b4c12534e","block_type":"box","text":"others to make such disbursements may be conditioned on the implementation of economic reforms and/or","page_number":74,"box":{"x":69,"y":755,"width":772,"height":11}},{"id":"7d5692ee-0c2e-4c56-b3df-ec5dae05394d","block_type":"box","text":"economic per formance and the timely service of such debtor’s obligations. Failure to implement such reforms,","page_number":74,"box":{"x":69,"y":770,"width":789,"height":12}},{"id":"2d525b17-3fa0-4464-be8d-af20140fe520","block_type":"box","text":"achieve such levels of economic per formance or repay principal or interest when due may result in the cancellation of","page_number":74,"box":{"x":69,"y":785,"width":839,"height":12}},{"id":"7747ff01-8dfa-4db9-aa64-8e337d39f01f","block_type":"box","text":"such third par ties’ commitments to lend funds to the governmental entity, which may fur ther impair such debtor’s","page_number":74,"box":{"x":69,"y":801,"width":810,"height":11}},{"id":"ceebd01e-00ef-4490-ace1-f752badb2ffc","block_type":"box","text":"ability or willingness to timely service its debts. Consequently, governmental entities may default on their sovereign","page_number":74,"box":{"x":69,"y":816,"width":821,"height":11}},{"id":"ca970584-056a-4c5e-b0d5-4fd8c8f84852","block_type":"box","text":"debt.","page_number":74,"box":{"x":69,"y":831,"width":34,"height":9}},{"id":"2edefcf2-92a3-472e-b35e-666ecc034369","block_type":"box","text":"Holders of sovereign debt may be requested to par ticipate in the rescheduling of such debt and to extend fur ther","page_number":74,"box":{"x":102,"y":853,"width":807,"height":12}},{"id":"60361cf1-a9cc-4f90-95b1-65784f98a56f","block_type":"box","text":"loans to governmental entities. In the event of a default by a governmental entity, there may be few or no effective","page_number":74,"box":{"x":70,"y":869,"width":814,"height":11}},{"id":"503f7263-22cb-4e5b-81cb-b7c61d2edd5e","block_type":"box","text":"legal remedies for collecting on such debt.","page_number":74,"box":{"x":70,"y":884,"width":300,"height":11}},{"id":"d9a818db-4d01-4260-baff-7a5e824b0fb5","block_type":"box","text":"II-30","page_number":74,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"12d1009b-f48d-493d-aae0-bebcb859e652","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":74,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"63efd048-4666-4c31-b2bb-bb4ac2f20d02","block_type":"box","text":"Withholding Tax Reclaims Risk","page_number":75,"box":{"x":103,"y":45,"width":215,"height":11}},{"id":"1ffc8920-f496-4dd9-b845-0d18d48d5aed","block_type":"box","text":". A Fund may file claims to recover foreign withholding taxes on dividend and","page_number":75,"box":{"x":318,"y":45,"width":542,"height":11}},{"id":"db74c837-e821-4cc5-a448-6c33cbeeafa9","block_type":"box","text":"interest income (if any) received from issuers in cer tain countries and capital gains on the disposition of stocks or","page_number":75,"box":{"x":70,"y":60,"width":813,"height":11}},{"id":"27bed507-acbf-477c-a932-712ddccb36a7","block_type":"box","text":"securities where such withholding tax reclaim is possible. Whether or when a Fund will receive a withholding tax","page_number":75,"box":{"x":69,"y":75,"width":795,"height":11}},{"id":"084aba55-7b4f-4610-beac-d7cbb898bb86","block_type":"box","text":"refund is within the control of the tax authorities in such countries. Where a Fund expects to recover withholding","page_number":75,"box":{"x":69,"y":90,"width":799,"height":11}},{"id":"457e4847-6314-46c9-83b0-1a8be467ba49","block_type":"box","text":"taxes, the net asset value of the Fund generally includes accruals for such tax refunds. Each Fund regularly evaluates","page_number":75,"box":{"x":68,"y":105,"width":838,"height":11}},{"id":"f692c690-d5b2-4507-bbb3-44cea77ad4be","block_type":"box","text":"the probability of recovery. If the likelihood of recovery materially decreases, due to, for example, a change in tax","page_number":75,"box":{"x":68,"y":120,"width":807,"height":12}},{"id":"1175b6ee-9274-48e1-99cb-8006dc43ccb9","block_type":"box","text":"regulation or approach in the foreign country, accruals in a Fund’s net asset value for such refunds may be written","page_number":75,"box":{"x":69,"y":135,"width":814,"height":12}},{"id":"c72fa2cd-0874-4413-972e-be62fa7d9e24","block_type":"box","text":"down par tially or in full, which will adversely affect the Fund’s net asset value. Shareholders in a Fund at the time an","page_number":75,"box":{"x":69,"y":150,"width":831,"height":12}},{"id":"a1bdc78b-c9e9-49ea-b914-c7e4ca39525f","block_type":"box","text":"accrual is written down will bear the impact of the resulting reduction in net asset value regardless of whether they","page_number":75,"box":{"x":69,"y":166,"width":819,"height":11}},{"id":"429d8b30-8c71-48e4-bdb2-265f1cd54a5a","block_type":"box","text":"were shareholders during the accrual period. Conversely, if a Fund receives a tax refund that has not been previously","page_number":75,"box":{"x":68,"y":181,"width":833,"height":11}},{"id":"66313eea-5f45-4616-8813-6778b2d1513f","block_type":"box","text":"accrued, shareholders in the Fund at the time of the successful recovery will benefit from the resulting increase in","page_number":75,"box":{"x":69,"y":196,"width":814,"height":11}},{"id":"2f1d9adf-104f-4560-a33b-556f39f13473","block_type":"box","text":"the Fund’s net asset value. Shareholders who sold their shares prior to such time will not benefit from such increase","page_number":75,"box":{"x":68,"y":211,"width":835,"height":11}},{"id":"7fe022e7-b743-4f47-a2a3-f7935221b0c4","block_type":"box","text":"in the Fund’s net asset value.","page_number":75,"box":{"x":70,"y":226,"width":209,"height":9}},{"id":"5ac76e74-2972-4da6-a015-20744442e921","block_type":"box","text":"U.S. Economic Trading Par tners Risk.","page_number":75,"box":{"x":103,"y":249,"width":263,"height":11}},{"id":"80c607eb-9de1-46a9-a1bf-8b7b0355bc87","block_type":"box","text":"The United States is a significant, and in some cases the most significant,","page_number":75,"box":{"x":372,"y":249,"width":532,"height":11}},{"id":"e01c33cb-f27c-4cc0-a13a-5a6943cb05f0","block_type":"box","text":"trading par tner of, or foreign investor in, cer tain countries in which a Fund may invest. As a result, economic","page_number":75,"box":{"x":68,"y":264,"width":773,"height":11}},{"id":"0e9444cf-26be-474f-bf0d-ecac9a980cb5","block_type":"box","text":"conditions of such countries may be par ticularly affected by changes in the U.S. economy. A decrease in U.S. impor ts","page_number":75,"box":{"x":69,"y":279,"width":839,"height":11}},{"id":"32f56c31-b756-410a-bf83-26444c6d4f59","block_type":"box","text":"or expor ts, new trade and financial regulations or tariffs, changes in the U.S. dollar exchange rate or an economic","page_number":75,"box":{"x":69,"y":294,"width":812,"height":11}},{"id":"394ed5e4-7b42-40d4-85dc-42ed8d40843c","block_type":"box","text":"slowdown in the United States may have a material adverse effect on a country’s economic conditions and, as a","page_number":75,"box":{"x":69,"y":309,"width":803,"height":11}},{"id":"022e4222-e06d-4e82-935b-8bc930c5bd7c","block_type":"box","text":"result, securities to which the Fund has exposure. Circumstances could arise that could prevent the timely payment","page_number":75,"box":{"x":69,"y":324,"width":824,"height":11}},{"id":"089ba771-edcc-4fa9-96e9-dc3b467df635","block_type":"box","text":"of interest or principal on U.S. Government debt, such as reaching the legislative “debt ceiling.” Such non-payment","page_number":75,"box":{"x":69,"y":339,"width":819,"height":12}},{"id":"be5c061c-0fb2-4949-a523-f110ffc4dae3","block_type":"box","text":"would result in substantial negative consequences for the U.S. economy and the global financial system.","page_number":75,"box":{"x":68,"y":355,"width":746,"height":11}},{"id":"072c5aae-576e-4fdd-a0e3-44433ae5ef2b","block_type":"box","text":"There are strained relations between the United States and a number of foreign countries, including traditional","page_number":75,"box":{"x":101,"y":377,"width":787,"height":12}},{"id":"4a5d0fc4-9fe0-4877-9133-ed505612851f","block_type":"box","text":"allies, such as cer tain European countries, and historical adversaries, such as Nor th Korea, Iran, China and Russia.","page_number":75,"box":{"x":69,"y":392,"width":827,"height":11}},{"id":"1c2c61d7-930c-47b0-9f62-9642de98da75","block_type":"box","text":"If these relations were to worsen, it could adversely affect U.S. issuers as well as non-U.S. issuers that rely on the","page_number":75,"box":{"x":70,"y":407,"width":817,"height":12}},{"id":"afe139c4-4b41-49f5-af9b-6bdf783ca836","block_type":"box","text":"United States for trade. The United States has also experienced increased internal unrest and discord. If these","page_number":75,"box":{"x":70,"y":423,"width":791,"height":11}},{"id":"3c34d304-c588-4919-a796-1be5d3068731","block_type":"box","text":"trends were to continue, it may have an adverse impact on the U.S. economy and many of the issuers in which a","page_number":75,"box":{"x":68,"y":438,"width":803,"height":11}},{"id":"9defe6c0-652b-4f10-9c62-b9ca069c8cff","block_type":"box","text":"Fund may invest.","page_number":75,"box":{"x":70,"y":453,"width":117,"height":11}},{"id":"7ef3a232-6d5f-458b-b8d7-46c12b47f967","block_type":"box","text":"Funding Agreements.","page_number":75,"box":{"x":102,"y":476,"width":154,"height":11}},{"id":"45f19fe8-0b86-43b9-8fa2-f927e214879e","block_type":"box","text":"Cer tain Funds may invest in Guaranteed Investment Contracts and similar funding","page_number":75,"box":{"x":262,"y":475,"width":584,"height":12}},{"id":"4455ef8b-6c8a-46de-9290-34793b6a6eca","block_type":"box","text":"agreements. In connection with these investments, a Fund makes cash contributions to a deposit fund of an","page_number":75,"box":{"x":69,"y":491,"width":773,"height":11}},{"id":"80f13c46-ac4c-4232-a4b6-ed2eb4cc2481","block_type":"box","text":"insurance company’s general account. The insurance company then credits to the Fund on a monthly basis","page_number":75,"box":{"x":70,"y":506,"width":761,"height":11}},{"id":"05f06495-477e-4f8b-a39d-c8a597739a11","block_type":"box","text":"guaranteed interest, which is based on an index. The funding agreements provide that this guaranteed interest will","page_number":75,"box":{"x":68,"y":521,"width":817,"height":11}},{"id":"ea928cb0-db4b-40a6-a6c7-4623ac6cb4ef","block_type":"box","text":"not be less than a cer tain minimum rate. The purchase price paid for a funding agreement becomes par t of the","page_number":75,"box":{"x":69,"y":536,"width":794,"height":11}},{"id":"c20e4338-63d9-41de-b880-3c4102b9a425","block_type":"box","text":"general assets of the insurance company, and the contract is paid from the general assets of the insurance company.","page_number":75,"box":{"x":68,"y":551,"width":839,"height":11}},{"id":"a717239d-26e3-43f7-a2de-285760f97ecf","block_type":"box","text":"Generally, funding agreements are not assignable or transferable without the permission of the issuing insurance","page_number":75,"box":{"x":69,"y":566,"width":806,"height":11}},{"id":"062d120d-c120-4aef-ad8a-7b58ed4e3919","block_type":"box","text":"companies, and an active secondary market in some funding agreements does not currently exist.","page_number":75,"box":{"x":69,"y":581,"width":700,"height":12}},{"id":"fb1ec08c-78f4-4b67-a2c4-7b7341d1dcca","block_type":"box","text":"Guarantees.","page_number":75,"box":{"x":102,"y":604,"width":87,"height":9}},{"id":"a67b17d5-d9f8-47e0-8034-022732fe7c8b","block_type":"box","text":"A Fund may purchase securities which contain guarantees issued by an entity separate from the","page_number":75,"box":{"x":194,"y":604,"width":685,"height":11}},{"id":"86ae6a0c-56cf-4c1f-8a6a-89498a41ba52","block_type":"box","text":"issuer of the security. Generally, the guarantor of a security (often an affiliate of the issuer) will fulfill an issuer’s","page_number":75,"box":{"x":70,"y":619,"width":797,"height":11}},{"id":"30ad394d-82c9-44b8-ba60-857cd4401bdc","block_type":"box","text":"payment obligations under a security if the issuer is unable to do so.","page_number":75,"box":{"x":70,"y":634,"width":488,"height":12}},{"id":"8f0a9b34-c344-44b2-b34d-7a64df0e90bc","block_type":"box","text":"Illiquid Investments.","page_number":75,"box":{"x":102,"y":657,"width":146,"height":11}},{"id":"c906028a-42e0-443d-a5a0-c8732a14ac3f","block_type":"box","text":"Each Fund may not acquire any illiquid investment if, immediately after the acquisition, a","page_number":75,"box":{"x":255,"y":657,"width":630,"height":11}},{"id":"a461f0f2-9a89-4418-83e5-66d1f185f18e","block_type":"box","text":"Fund would have invested more than 15% of its net assets in illiquid investments. An illiquid investment is any","page_number":75,"box":{"x":70,"y":672,"width":787,"height":11}},{"id":"1de1d116-99c2-4b60-8008-d6f279a2b7ed","block_type":"box","text":"investment that a Fund reasonably expects cannot be sold or disposed of in current market conditions in seven","page_number":75,"box":{"x":70,"y":687,"width":792,"height":11}},{"id":"a0682699-0dc2-4a46-b3ac-a41674829e60","block_type":"box","text":"calendar days or less without the sale or disposition significantly changing the market value of the investment. Liquid","page_number":75,"box":{"x":69,"y":702,"width":834,"height":12}},{"id":"903376a7-9035-46bf-91f7-6d3a0068caaa","block_type":"box","text":"investments may become illiquid after purchase by a Fund, par ticularly during periods of market turmoil. There can be","page_number":75,"box":{"x":70,"y":717,"width":838,"height":12}},{"id":"c5dde22e-47a7-46ca-9f4e-082981b08d5f","block_type":"box","text":"no assurance that a security or instrument that is deemed to be liquid when purchased will continue to be liquid for","page_number":75,"box":{"x":69,"y":732,"width":824,"height":12}},{"id":"1fa15e1f-f1ba-4e62-b04f-57e2730a41c8","block_type":"box","text":"as long as it is held by a Fund, and any security or instrument held by the Fund may be deemed an illiquid investment","page_number":75,"box":{"x":69,"y":748,"width":838,"height":11}},{"id":"4cf4221c-6803-4279-aa7f-ef115e4ded23","block_type":"box","text":"pursuant to the Fund’s liquidity risk management program. A Fund’s illiquid investments may reduce the returns of","page_number":75,"box":{"x":70,"y":763,"width":816,"height":11}},{"id":"7e9b64a0-5278-49eb-9805-05e966b77f3e","block_type":"box","text":"the Fund because it may be difficult to sell the illiquid investments at an advantageous time or price. In addition, if a","page_number":75,"box":{"x":68,"y":778,"width":832,"height":11}},{"id":"2a832e51-69cf-4c8a-a8b8-e0b131a6872b","block_type":"box","text":"Fund is limited in its ability to dispose of illiquid investments during periods when shareholders are redeeming or","page_number":75,"box":{"x":70,"y":793,"width":803,"height":11}},{"id":"789cfd5a-95e7-41fb-a242-ca0d1d48220c","block_type":"box","text":"selling their shares, or the Fund’s net assets otherwise shrink, the Fund will need to dispose of liquid securities to","page_number":75,"box":{"x":69,"y":808,"width":817,"height":11}},{"id":"e332134a-11fa-4b5d-9e97-fab435157703","block_type":"box","text":"meet redemption requests and illiquid securities will become a larger por tion of the Fund’s holdings. If illiquid","page_number":75,"box":{"x":69,"y":823,"width":781,"height":12}},{"id":"c695c099-1757-409e-b4dc-2f08eaa5c324","block_type":"box","text":"investments exceed 15% of a Fund’s net assets, the Liquidity Rule (as defined below) and the Liquidity Program (as","page_number":75,"box":{"x":70,"y":838,"width":822,"height":12}},{"id":"b392d9d3-cdd7-4b4c-b9f5-bd360f501836","block_type":"box","text":"defined below) will require that cer tain remedial actions be taken. Illiquid investments may trade at a discount from","page_number":75,"box":{"x":69,"y":853,"width":822,"height":12}},{"id":"7a13b95a-3c53-4594-a3b7-c450515514dd","block_type":"box","text":"comparable liquid investments. Investment of a Fund’s assets in illiquid investments may restrict the ability of the","page_number":75,"box":{"x":69,"y":869,"width":813,"height":11}},{"id":"64962421-1632-4067-8a76-b0c40cda599c","block_type":"box","text":"Fund to dispose of its investments in a timely fashion and for a fair price as well as its ability to take advantage of","page_number":75,"box":{"x":70,"y":884,"width":814,"height":11}},{"id":"524a63d5-9fc0-4e8c-8db2-1dde43ea2816","block_type":"box","text":"market oppor tunities. The risks associated with illiquidity will be par ticularly acute where a Fund’s operations require","page_number":75,"box":{"x":69,"y":899,"width":833,"height":11}},{"id":"b8789959-64ef-48b7-b8aa-fbfdadc9a312","block_type":"box","text":"II-31","page_number":75,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"77047bfe-b4b5-4d6b-984f-ce35395b3057","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":75,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"786527a9-300d-48a0-8432-2cbe219126f0","block_type":"box","text":"cash, such as when the Fund redeems shares or pays dividends, and could result in the Fund borrowing to meet","page_number":76,"box":{"x":69,"y":45,"width":801,"height":11}},{"id":"848d4784-809b-4957-9730-9b54ddfff85f","block_type":"box","text":"shor t-term cash requirements or incurring capital losses on the sale of illiquid investments.","page_number":76,"box":{"x":69,"y":60,"width":651,"height":11}},{"id":"5471af35-6ab0-4125-80f7-d1d6ef1e9232","block_type":"box","text":"Index Funds.","page_number":76,"box":{"x":102,"y":83,"width":91,"height":8}},{"id":"24a85f97-3bc4-46c5-a91d-e6c6f51072a6","block_type":"box","text":"Cash Flows; Expenses.","page_number":76,"box":{"x":102,"y":105,"width":162,"height":11}},{"id":"d470ce1d-10b5-417f-857b-6dc0b55fb1ab","block_type":"box","text":"The ability of each Fund to satisfy its investment objective depends to some extent on","page_number":76,"box":{"x":270,"y":105,"width":613,"height":11}},{"id":"983c05a5-d939-45bb-937c-7fe51161e042","block_type":"box","text":"the Manager’s ability to manage cash flow (primarily from purchases and redemptions and distributions from the","page_number":76,"box":{"x":68,"y":120,"width":803,"height":12}},{"id":"080d89fe-7298-41db-8f07-354b79022667","block_type":"box","text":"Fund’s investments). The Manager will make investment changes to a Fund’s por tfolio to accommodate cash flow","page_number":76,"box":{"x":70,"y":135,"width":810,"height":12}},{"id":"8473af1a-4394-4278-84ec-b4001da64c7c","block_type":"box","text":"while continuing to seek to replicate the total return of the Fund’s target index. Investors should also be aware that","page_number":76,"box":{"x":68,"y":150,"width":823,"height":12}},{"id":"fe08973c-b7b2-47f0-a9d4-c83e5edeca9b","block_type":"box","text":"the investment per formance of each index is a hypothetical number which does not take into account brokerage","page_number":76,"box":{"x":68,"y":166,"width":799,"height":11}},{"id":"e0eb2f92-7578-403a-be13-a516569cc682","block_type":"box","text":"commissions and other transaction costs, custody and other costs of investing, and any incremental operating costs","page_number":76,"box":{"x":69,"y":181,"width":831,"height":11}},{"id":"483cb158-edff-4726-ad4f-2bd451d5562b","block_type":"box","text":"(","page_number":76,"box":{"x":69,"y":196,"width":3,"height":11}},{"id":"a83ca0fa-4358-4089-9230-aac1b0b5d76f","block_type":"box","text":"e.g.","page_number":76,"box":{"x":74,"y":197,"width":25,"height":10}},{"id":"208410fc-f5e8-4b91-b7ff-85d9a42d2e4e","block_type":"box","text":", transfer agency and accounting costs) that will be borne by the Funds. Finally, since each Fund seeks to","page_number":76,"box":{"x":101,"y":196,"width":749,"height":11}},{"id":"9127931d-50f7-474d-8012-f0d814cb95de","block_type":"box","text":"replicate the total return of its target index, the Manager generally will not attempt to judge the merits of any","page_number":76,"box":{"x":69,"y":211,"width":774,"height":11}},{"id":"0cd26990-be06-41e6-a389-f84a1b32c432","block_type":"box","text":"par ticular security as an investment.","page_number":76,"box":{"x":70,"y":226,"width":258,"height":11}},{"id":"9d2ede4f-9d78-4af5-85a5-b317b98fb97e","block_type":"box","text":"Tracking Error Risk","page_number":76,"box":{"x":103,"y":249,"width":132,"height":11}},{"id":"37181e7f-0d18-4fb2-8c3e-e8f952dc6c75","block_type":"box","text":". A Fund may be subject to tracking error, which is the divergence of the Fund’s per formance","page_number":76,"box":{"x":236,"y":249,"width":658,"height":11}},{"id":"4012e0a6-c2df-413a-8b1f-d71b06dc0f7b","block_type":"box","text":"from that of the Underlying Index. Tracking error may occur because of differences between the securities and other","page_number":76,"box":{"x":68,"y":264,"width":827,"height":11}},{"id":"eb0f4b6a-33ae-4bfc-b6d3-845ad2a32693","block_type":"box","text":"instruments held in the Fund’s por tfolio and those included in the Underlying Index, pricing differences (including, as","page_number":76,"box":{"x":70,"y":279,"width":830,"height":11}},{"id":"843b11d5-7440-4b93-bde8-d3a6aabbb8fa","block_type":"box","text":"applicable, differences between a security’s price at the local market close and the Fund’s valuation of a security at","page_number":76,"box":{"x":69,"y":294,"width":827,"height":11}},{"id":"02f6bb92-1202-41fe-b0f2-39725a789450","block_type":"box","text":"the time of calculation of the Fund’s net asset value), differences in transaction costs incurred by the Fund, the","page_number":76,"box":{"x":68,"y":309,"width":797,"height":11}},{"id":"1b5a5b20-4363-4f62-832f-50ed057bafb7","block_type":"box","text":"Fund’s holding of uninvested cash, differences in timing of the accrual of or the valuation of dividends or other","page_number":76,"box":{"x":70,"y":324,"width":787,"height":12}},{"id":"f7daacc8-04ef-4b40-a256-43b7fa36942c","block_type":"box","text":"distributions, interest, the requirements to maintain pass-through tax treatment, por tfolio transactions carried out to","page_number":76,"box":{"x":69,"y":339,"width":830,"height":12}},{"id":"b246f099-db4e-4a82-a84b-60c28c754870","block_type":"box","text":"minimize the distribution of capital gains to shareholders, changes to the Underlying Index or the costs to the Fund of","page_number":76,"box":{"x":69,"y":355,"width":838,"height":11}},{"id":"6418629b-d559-49bf-b13a-de599faf4413","block_type":"box","text":"complying with various new or existing regulatory requirements. These risks may be heightened during times of","page_number":76,"box":{"x":69,"y":370,"width":791,"height":11}},{"id":"2b0bf4ce-09b1-4947-ab37-8aa586567da4","block_type":"box","text":"increased market volatility or other unusual market conditions. In addition, tracking error may result because the","page_number":76,"box":{"x":70,"y":385,"width":801,"height":11}},{"id":"27ffdb8b-49ed-41a2-8ea7-909f8c71c2b0","block_type":"box","text":"Fund incurs fees and expenses, while the Underlying Index does not.","page_number":76,"box":{"x":70,"y":400,"width":487,"height":11}},{"id":"e83664af-a9cb-40cf-b211-ae305ff506bd","block_type":"box","text":"When an issuer is introduced by an index provider into an index tracked by a Fund, the Manager may conduct an","page_number":76,"box":{"x":101,"y":423,"width":799,"height":11}},{"id":"87f85d80-1849-414e-8f47-9877c458c331","block_type":"box","text":"analysis on such issuer’s securities to identify and screen for outlier high risk behavior (such as rapid or unusual","page_number":76,"box":{"x":69,"y":438,"width":803,"height":11}},{"id":"4c47a61e-b3a2-4e5f-ab3e-abc01bc36216","block_type":"box","text":"price growth that does not appear to be suppor ted by publicly available information on the business and assets of","page_number":76,"box":{"x":70,"y":453,"width":814,"height":11}},{"id":"ed5ba012-759a-4729-a79a-617a646d3694","block_type":"box","text":"the issuer, unusual or significant shor t interest or lending activity, negative sentiment, suspended trading or incorrect","page_number":76,"box":{"x":68,"y":468,"width":838,"height":11}},{"id":"86adc034-e893-4314-a1cd-0b67b52191a0","block_type":"box","text":"free-float calculations, which could be indicators of possible irregularities, miscalculations or even fraud). If it","page_number":76,"box":{"x":68,"y":483,"width":778,"height":11}},{"id":"d04de544-3e3b-4295-9f0b-804f56e7b628","block_type":"box","text":"identifies such behavior, the Manager may, where appropriate, aler t the index provider as to the alleged issue. The","page_number":76,"box":{"x":70,"y":498,"width":816,"height":11}},{"id":"9d3fff5d-b99d-4ed1-b4a9-294892b11178","block_type":"box","text":"index provider has sole discretion for the determination as to whether to continue to include the issuer’s securities in","page_number":76,"box":{"x":70,"y":513,"width":836,"height":11}},{"id":"a177c94d-7610-409e-9d0e-61853c2b32be","block_type":"box","text":"the rebalancing of its index. If the securities continue to be included in the index, the Manager may underweight or","page_number":76,"box":{"x":68,"y":528,"width":819,"height":12}},{"id":"8c28b131-a1e1-4c2c-ad7e-22138ec1a20c","block_type":"box","text":"exclude such securities from a Fund’s por tfolio and, if it does so, such Fund will be subject to increased tracking","page_number":76,"box":{"x":69,"y":543,"width":804,"height":12}},{"id":"02f9946b-94e4-42d9-adf5-04110593fbc2","block_type":"box","text":"error due to the divergence in the securities included in its por tfolio from its underlying index. The application of the","page_number":76,"box":{"x":69,"y":559,"width":825,"height":11}},{"id":"1b7d1233-5285-4a92-9492-2fa08d810241","block_type":"box","text":"abovementioned analysis and screening to a Fund and its Underlying Index is in the sole discretion of the Manager","page_number":76,"box":{"x":69,"y":574,"width":818,"height":11}},{"id":"7c8c27ed-fd44-4c86-af3d-4e0518f3ea02","block_type":"box","text":"and its affiliates (without any guarantees). The analysis and screening may not exclude any or all high risk securities","page_number":76,"box":{"x":69,"y":589,"width":829,"height":11}},{"id":"73ddb2f0-8ad0-41e3-a0f5-f4409ecc1099","block_type":"box","text":"from an Underlying Index or a Fund’s por tfolio, and the inclusion of such securities will result in an adverse impact to","page_number":76,"box":{"x":68,"y":604,"width":835,"height":11}},{"id":"a5314502-fa83-47c5-8738-dc228fe23dde","block_type":"box","text":"the Fund’s net asset value if one or more such securities declines in value.","page_number":76,"box":{"x":68,"y":619,"width":536,"height":9}},{"id":"a465f1a4-ad8c-46bc-a899-a3b9d2b70a1a","block_type":"box","text":"S&P 500®","page_number":76,"box":{"x":102,"y":642,"width":64,"height":9}},{"id":"acdaf4f8-dd1f-441e-93c5-7d722f2e1c92","block_type":"box","text":"0®","page_number":76,"box":{"x":166,"y":642,"width":6,"height":5}},{"id":"42c96e54-4476-40b8-ba5a-e56b035f3949","block_type":"box","text":"Index (“S&P 500”).","page_number":76,"box":{"x":178,"y":642,"width":134,"height":11}},{"id":"a38efeaa-3155-40b6-aeaa-5cc8c7c25583","block_type":"box","text":"“Standard & Poor’s","page_number":76,"box":{"x":320,"y":642,"width":136,"height":9}},{"id":"01d1202e-72d2-44aa-9576-2583f7d7f75b","block_type":"box","text":"®","page_number":76,"box":{"x":457,"y":642,"width":6,"height":5}},{"id":"76243408-84ec-4a55-905c-3f1865086275","block_type":"box","text":",” “S&P","page_number":76,"box":{"x":465,"y":642,"width":53,"height":10}},{"id":"d2fc057f-355c-40f2-9fcb-1118a257ecfa","block_type":"box","text":"®","page_number":76,"box":{"x":518,"y":642,"width":6,"height":5}},{"id":"14d203cc-d4ab-440e-aede-d1664069d223","block_type":"box","text":",” “S&P 500","page_number":76,"box":{"x":526,"y":642,"width":87,"height":10}},{"id":"b2169afd-7ded-4716-8220-4a09b89237f6","block_type":"box","text":"®","page_number":76,"box":{"x":614,"y":642,"width":6,"height":5}},{"id":"9712a934-31bb-496d-bdd3-a726ad6f140f","block_type":"box","text":",” “Standard & Poor’s 500,” and “500”","page_number":76,"box":{"x":621,"y":642,"width":280,"height":10}},{"id":"72bc0668-05da-4f2b-9bd1-5f5e02fd98cd","block_type":"box","text":"are trademarks of S&P Global Inc. and have been licensed for use by cer tain mutual funds sponsored and advised by","page_number":76,"box":{"x":69,"y":657,"width":837,"height":11}},{"id":"3b8e6ad6-e7d1-4b26-93fd-721558f1a297","block_type":"box","text":"BlackRock or its affiliates (“BlackRock Funds”). No Fund is sponsored, endorsed, sold or promoted by S&P, a division","page_number":76,"box":{"x":70,"y":672,"width":836,"height":11}},{"id":"18058c4b-61a5-470b-9c9f-c77d0cd905e0","block_type":"box","text":"of S&P Global Inc. S&P makes no representation regarding the advisability of investing in any Fund. S&P makes no","page_number":76,"box":{"x":69,"y":687,"width":818,"height":11}},{"id":"9e6d7d60-5e55-48df-b17d-d877f0658ba1","block_type":"box","text":"representation or warranty, express or implied, to the owners of shares of a Fund or any member of the public","page_number":76,"box":{"x":69,"y":702,"width":783,"height":11}},{"id":"44cada6d-da97-4a94-b1e3-246f4cfe850b","block_type":"box","text":"regarding the advisability of investing in securities generally or in a Fund par ticularly or the ability of the S&P 500 to","page_number":76,"box":{"x":69,"y":717,"width":823,"height":12}},{"id":"39a6ae0a-e40f-469a-bacd-9582edb56181","block_type":"box","text":"track general stock market per formance. S&P’s only relationship to cer tain Funds is the licensing of cer tain","page_number":76,"box":{"x":68,"y":732,"width":769,"height":12}},{"id":"eb670018-a952-4958-85f6-490036e9e537","block_type":"box","text":"trademarks and trade names of S&P and of the S&P 500 which is determined, composed and calculated by S&P","page_number":76,"box":{"x":68,"y":748,"width":804,"height":11}},{"id":"a5f1c411-0160-48b3-9c62-1ed50e1dd4e5","block_type":"box","text":"without regard to the Funds. S&P has no obligation to take the needs of a Fund or the owners of shares of a Fund","page_number":76,"box":{"x":68,"y":763,"width":811,"height":11}},{"id":"fb4eab35-cc86-4d2c-a7bd-e54472836acc","block_type":"box","text":"into consideration in determining, composing or calculating the S&P 500. 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A Fund may also invest in so-called “inverse floating obligations”","page_number":78,"box":{"x":69,"y":339,"width":837,"height":12}},{"id":"a2dbd193-6094-4a77-8d8f-bda27ff04ce9","block_type":"box","text":"or “residual interest bonds” on which the interest rates vary inversely with a floating rate (which may be reset","page_number":78,"box":{"x":69,"y":355,"width":781,"height":11}},{"id":"9cb60aeb-1bb5-47fe-92d4-4123a3264a48","block_type":"box","text":"periodically by a Dutch auction, a remarketing agent, or by reference to a shor t-term tax-exempt interest rate index). A","page_number":78,"box":{"x":70,"y":370,"width":838,"height":11}},{"id":"9a050cf1-5d6e-464c-974e-cd8281ab423d","block_type":"box","text":"Fund may purchase synthetically-created inverse floating rate bonds evidenced by custodial or trust receipts.","page_number":78,"box":{"x":70,"y":385,"width":771,"height":11}},{"id":"247a7fb7-6c3f-4df5-8c22-31e6faff9a5e","block_type":"box","text":"Generally, income on inverse floating rate bonds will decrease when interest rates increase, and will increase when","page_number":78,"box":{"x":69,"y":400,"width":820,"height":11}},{"id":"17080bf4-e91a-4c16-a982-1a180a557b07","block_type":"box","text":"interest rates decrease. Such securities have the effect of providing a degree of investment leverage, since they may","page_number":78,"box":{"x":70,"y":415,"width":835,"height":11}},{"id":"356549de-198b-4750-ba6a-566ddfc4ccf4","block_type":"box","text":"increase or decrease in value in response to changes, as an illustration, in market interest rates at a rate that is a","page_number":78,"box":{"x":70,"y":430,"width":817,"height":11}},{"id":"e2e0731b-97fe-43ba-af68-08b5b4cb95df","block_type":"box","text":"multiple of the rate at which fixed-rate securities increase or decrease in response to such changes. As a result, the","page_number":78,"box":{"x":69,"y":445,"width":829,"height":12}},{"id":"81957147-908a-4bd4-9266-6fa6c7ffb110","block_type":"box","text":"market values of such securities will generally be more volatile than the market values of fixed-rate securities. To","page_number":78,"box":{"x":69,"y":460,"width":804,"height":12}},{"id":"b1cb20ea-cf15-4ec9-b513-ff5f0e7bcb98","block_type":"box","text":"seek to limit the volatility of these securities, a Fund may purchase inverse floating obligations that have shor ter-term","page_number":78,"box":{"x":69,"y":475,"width":838,"height":12}},{"id":"c1333578-2f48-4dff-b863-2e2e747dcba9","block_type":"box","text":"maturities or that contain limitations on the extent to which the interest rate may vary. Cer tain investments in such","page_number":78,"box":{"x":69,"y":491,"width":819,"height":11}},{"id":"81c2462d-7166-44b6-a4a7-eec101215169","block_type":"box","text":"obligations may be illiquid. The Manager believes that indexed and inverse floating obligations represent flexible","page_number":78,"box":{"x":69,"y":506,"width":798,"height":11}},{"id":"c7774831-6630-4aa8-aeec-38be73b603c1","block_type":"box","text":"por tfolio management instruments for a Fund that allow the Fund to seek potential investment rewards, hedge other","page_number":78,"box":{"x":70,"y":521,"width":829,"height":11}},{"id":"e174be16-f15d-4e97-b3ae-5ef41f6f497a","block_type":"box","text":"por tfolio positions or vary the degree of investment leverage relatively efficiently under different market conditions. A","page_number":78,"box":{"x":70,"y":536,"width":834,"height":11}},{"id":"17379f60-653a-4219-9c06-9e3bdfefdc94","block_type":"box","text":"Fund may invest in indexed and inverse securities for hedging purposes or to seek to increase returns. When used for","page_number":78,"box":{"x":70,"y":551,"width":839,"height":11}},{"id":"fdec9669-8d8a-4eca-9920-2a770d27a7b7","block_type":"box","text":"hedging purposes, indexed and inverse securities involve correlation risk. Fur thermore, where such a security","page_number":78,"box":{"x":69,"y":566,"width":781,"height":11}},{"id":"b4593e26-3c59-4bda-b98e-b7e4c70caba3","block_type":"box","text":"includes a contingent liability, in the event of an adverse movement in the underlying index or interest rate, a Fund","page_number":78,"box":{"x":70,"y":581,"width":812,"height":12}},{"id":"aa28bbcc-224f-4016-b2d2-c75494accc77","block_type":"box","text":"may be required to pay substantial additional margin to maintain the position.","page_number":78,"box":{"x":69,"y":597,"width":553,"height":11}},{"id":"7c8a38ac-934d-4179-9fd1-7c3dc28473eb","block_type":"box","text":"The Funds may invest up to 10% of their total assets in leveraged inverse floating rate debt instruments","page_number":78,"box":{"x":101,"y":619,"width":741,"height":11}},{"id":"1d3d96de-69c6-4ab8-bd8d-3c8fd1efed59","block_type":"box","text":"(“inverse floaters”). Inverse floaters are securities the potential of which is inversely related to changes in interest","page_number":78,"box":{"x":69,"y":634,"width":815,"height":12}},{"id":"0c464f7d-911f-4431-90ba-1249902efe98","block_type":"box","text":"rates. In general, the return on inverse floaters will decrease when shor t-term interest rates increase and increase","page_number":78,"box":{"x":69,"y":649,"width":817,"height":12}},{"id":"39811f30-5fda-4ea4-a0a0-01f07ca04a10","block_type":"box","text":"when shor t-term rates decrease. Municipal tender option bonds, both taxable and tax-exempt, which may include","page_number":78,"box":{"x":68,"y":665,"width":805,"height":11}},{"id":"27af1f9d-ef87-46ef-ac89-efbb385d750f","block_type":"box","text":"inverse floating rate debt instruments, (including residual interests thereon) are excluded from this 10% limitation.","page_number":78,"box":{"x":70,"y":680,"width":813,"height":11}},{"id":"587baeda-d218-4074-bdce-443f41b43cd6","block_type":"box","text":"Inflation Risk.","page_number":78,"box":{"x":102,"y":702,"width":100,"height":9}},{"id":"27a2a4a8-911f-48a0-9243-fc0d464d8f2c","block_type":"box","text":"Like all funds, the Funds are subject to inflation risk. Inflation risk is the risk that the present","page_number":78,"box":{"x":209,"y":702,"width":663,"height":11}},{"id":"0a073e81-2f23-4310-b483-ee48a4c8a85c","block_type":"box","text":"value of assets or income from investments will be less in the future as inflation decreases the value of money. As","page_number":78,"box":{"x":68,"y":717,"width":820,"height":12}},{"id":"a2b9b0ce-e1fc-49bb-aef9-7cab18dbb6db","block_type":"box","text":"inflation increases, the present value of a Fund’s assets can decline as can the value of a Fund’s distributions.","page_number":78,"box":{"x":70,"y":732,"width":792,"height":11}},{"id":"9e573a93-c5a2-41a5-8251-749c49888b94","block_type":"box","text":"Inflation rates may change frequently and significantly due to a number of potential factors, including, among others,","page_number":78,"box":{"x":70,"y":748,"width":829,"height":11}},{"id":"10ea819b-96c2-4f8c-bc95-b0c92de47fc0","block_type":"box","text":"unexpected economic shifts or changes in fiscal or monetary policies.","page_number":78,"box":{"x":69,"y":763,"width":497,"height":11}},{"id":"0052be76-c08b-4f6d-a371-10ac03c3567d","block_type":"box","text":"Initial Public Offering (“IPO”) Risk.","page_number":78,"box":{"x":102,"y":785,"width":253,"height":12}},{"id":"792d7acb-03c5-48fa-b6f5-3275f5f78063","block_type":"box","text":"The volume of IPOs and the levels at which the newly issued stocks trade in","page_number":78,"box":{"x":361,"y":785,"width":540,"height":12}},{"id":"52b5fd8d-be28-4f6e-83fb-520269c988ad","block_type":"box","text":"the secondary market are affected by the per formance of the stock market overall. If IPOs are brought to the market,","page_number":78,"box":{"x":68,"y":801,"width":836,"height":11}},{"id":"07c25ae5-1b2a-460a-98c0-e8dda64d3c38","block_type":"box","text":"availability may be limited and a Fund may not be able to buy any shares at the offering price, or if it is able to buy","page_number":78,"box":{"x":69,"y":816,"width":815,"height":11}},{"id":"23eccbb4-93ca-4843-ae34-b2977ce0f0a0","block_type":"box","text":"shares, it may not be able to buy as many shares at the offering price as it would like. In addition, the prices of","page_number":78,"box":{"x":69,"y":831,"width":795,"height":11}},{"id":"a92345d2-b8a0-46ee-9157-2a2fef437f72","block_type":"box","text":"securities involved in IPOs are often subject to greater and more unpredictable price changes than more established","page_number":78,"box":{"x":69,"y":846,"width":829,"height":11}},{"id":"31a473c7-c308-422b-8ac3-211c69d2d15d","block_type":"box","text":"stocks. IPOs have the potential to produce substantial gains. A Fund may hold shares from an IPO for only a shor t","page_number":78,"box":{"x":69,"y":861,"width":814,"height":11}},{"id":"8ad7b26e-c31b-4158-8356-551e92909732","block_type":"box","text":"period of time given possible price volatility. This may result in increased por tfolio turnover and expenses, such as","page_number":78,"box":{"x":70,"y":876,"width":813,"height":11}},{"id":"b1f179c9-5fff-4e21-b091-6417ded5c997","block_type":"box","text":"commissions and transaction costs, and potentially result in taxable gains that the Fund will subsequently distribute","page_number":78,"box":{"x":69,"y":891,"width":828,"height":12}},{"id":"7c0d3c4a-f13a-48f5-896c-966524554971","block_type":"box","text":"to shareholders. There is no assurance that any Fund will have access to profitable IPOs and therefore investors","page_number":78,"box":{"x":68,"y":906,"width":802,"height":12}},{"id":"4784eb19-f76e-40b7-bb71-03a5e4d865e4","block_type":"box","text":"II-34","page_number":78,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"62ba8da8-b52f-4a81-bbed-319289a17281","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":78,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"dbbcdfaf-a1a7-4c1b-af35-6b901d05f1ff","block_type":"box","text":"should not rely on any past gains from IPOs as an indication of future per formance. The investment per formance of a","page_number":79,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"7737656f-a8f5-4745-ae39-740d384ff4fc","block_type":"box","text":"Fund during periods when it is unable to invest significantly or at all in IPOs may be lower than during periods when it","page_number":79,"box":{"x":70,"y":60,"width":832,"height":11}},{"id":"bc277840-3ce3-40de-b1de-8b4a5237584b","block_type":"box","text":"is able to do so. In addition, as a Fund increases in size, the impact of IPOs on its per formance will generally","page_number":79,"box":{"x":70,"y":75,"width":777,"height":11}},{"id":"66a185f8-0f6c-4c90-a9e1-8e69fff413a7","block_type":"box","text":"decrease. Securities issued in IPOs are subject to many of the same risks as investing in companies with smaller","page_number":79,"box":{"x":69,"y":90,"width":810,"height":11}},{"id":"a2353b9a-5ad2-4ce9-9c76-0ba87617eb39","block_type":"box","text":"market capitalizations. Securities issued in IPOs have no trading history, and information about the companies may","page_number":79,"box":{"x":69,"y":105,"width":823,"height":11}},{"id":"243fdac1-dcb7-40c4-9942-e56352859caf","block_type":"box","text":"be available for very limited periods.","page_number":79,"box":{"x":69,"y":120,"width":257,"height":11}},{"id":"93f6df64-f19a-4c58-84c1-a6f8a6211cd6","block_type":"box","text":"Investment in Emerging Markets.","page_number":79,"box":{"x":102,"y":143,"width":242,"height":11}},{"id":"7fa3a43e-88a3-4da6-b629-ac18e8ee73c4","block_type":"box","text":"General.","page_number":79,"box":{"x":102,"y":166,"width":58,"height":9}},{"id":"623165dc-6202-4fec-a4b1-60a390bf0337","block_type":"box","text":"Cer tain Funds may invest in the securities of issuers domiciled in various countries with emerging capital","page_number":79,"box":{"x":102,"y":188,"width":748,"height":12}},{"id":"09f5af84-acf8-4bf9-a9e7-e9463ad9ad8b","block_type":"box","text":"markets. Unless otherwise provided in a Fund’s Prospectus, a country with an emerging capital market is any country","page_number":79,"box":{"x":69,"y":204,"width":840,"height":11}},{"id":"7c9acd7f-f9df-451c-bd57-fed214341cb9","block_type":"box","text":"that is (i) generally recognized to be an emerging market country by the international financial community, such as","page_number":79,"box":{"x":68,"y":218,"width":813,"height":12}},{"id":"8fc66ca7-afd8-432d-858a-6e1779d1128b","block_type":"box","text":"the International Finance Corporation, or determined by the World Bank to have a low, middle or middle upper income","page_number":79,"box":{"x":68,"y":234,"width":836,"height":11}},{"id":"5b80454a-65d2-400a-8250-55e3591b4279","block_type":"box","text":"economy; (ii) classified by the United Nations or its authorities to be developing; and/or (iii) included in a broad-based","page_number":79,"box":{"x":69,"y":249,"width":839,"height":11}},{"id":"2e2b3b5b-2d91-4de5-a7b8-c36513aea5e0","block_type":"box","text":"index that is generally representative of emerging markets. Countries with emerging markets can be found in regions","page_number":79,"box":{"x":70,"y":264,"width":831,"height":11}},{"id":"c26cc944-fbfe-47bc-8528-092016f0ca24","block_type":"box","text":"such as Asia, Latin America, Eastern Europe and Africa.","page_number":79,"box":{"x":69,"y":279,"width":396,"height":11}},{"id":"7a22fe0e-7ce3-4195-979c-bdb706e4bb4c","block_type":"box","text":"Investments in the securities of issuers domiciled in countries with emerging capital markets involve cer tain","page_number":79,"box":{"x":102,"y":302,"width":770,"height":11}},{"id":"447c4639-58de-459d-84a3-ad35a01e6047","block_type":"box","text":"additional risks that do not generally apply to investments in securities of issuers in more developed capital markets,","page_number":79,"box":{"x":69,"y":317,"width":835,"height":11}},{"id":"5c69740b-a647-4df5-b674-b5ce0f87280b","block_type":"box","text":"such as (i) low or non-existent trading volume, resulting in market illiquidity and increased volatility in prices for such","page_number":79,"box":{"x":69,"y":332,"width":828,"height":11}},{"id":"00d0d849-6212-4471-81b0-c27102a2e719","block_type":"box","text":"securities, as compared to securities of comparable issuers in more developed capital markets; (ii) uncer tain","page_number":79,"box":{"x":69,"y":347,"width":779,"height":11}},{"id":"834d0f62-40fa-48da-8ff3-0a181e27eef6","block_type":"box","text":"national policies and social, political and economic instability, increasing the potential for expropriation of assets,","page_number":79,"box":{"x":69,"y":362,"width":809,"height":11}},{"id":"e00f6cac-4493-42bb-987c-41ccd264ae0b","block_type":"box","text":"confiscatory taxation, high rates of inflation or unfavorable diplomatic developments; (iii) possible fluctuations in","page_number":79,"box":{"x":69,"y":377,"width":800,"height":12}},{"id":"aadec081-65be-49e5-a744-6e983c237655","block_type":"box","text":"exchange rates, differing legal systems and the existence or possible imposition of exchange controls, custodial","page_number":79,"box":{"x":69,"y":392,"width":800,"height":12}},{"id":"cbf99315-eef1-402a-b824-6ea2969ec3d6","block_type":"box","text":"restrictions or other foreign or U.S. Governmental laws or restrictions applicable to such investments; (iv) national","page_number":79,"box":{"x":69,"y":407,"width":811,"height":12}},{"id":"decf14ed-cbac-4f9f-a9ee-8352ddb07c4f","block_type":"box","text":"policies that may limit a Fund’s investment oppor tunities such as restrictions on investment in issuers or industries","page_number":79,"box":{"x":70,"y":423,"width":824,"height":11}},{"id":"92370edd-f3d1-44f8-b77c-cf6c3cca7770","block_type":"box","text":"deemed sensitive to national interests; and (v) the lack or relatively early development of legal structures governing","page_number":79,"box":{"x":69,"y":438,"width":823,"height":11}},{"id":"aec666df-1c34-4d36-9f33-78eeaebb1a33","block_type":"box","text":"private and foreign investments and private proper ty. In addition to withholding taxes on investment income, some","page_number":79,"box":{"x":70,"y":453,"width":813,"height":11}},{"id":"895ce70c-8b4d-4b32-b369-34ed3d710ec3","block_type":"box","text":"countries with emerging markets may impose differential capital gains taxes on foreign investors.","page_number":79,"box":{"x":69,"y":468,"width":694,"height":11}},{"id":"0cb0ef88-56c1-40df-95e6-45390db19163","block_type":"box","text":"Political and economic structures in emerging market countries may be undergoing significant evolution and","page_number":79,"box":{"x":102,"y":491,"width":767,"height":11}},{"id":"a9544d7c-c64a-4de4-81d4-f4a81f4cea8b","block_type":"box","text":"rapid development, and these countries may lack the social, political and economic stability characteristic of more","page_number":79,"box":{"x":69,"y":506,"width":814,"height":11}},{"id":"daadb706-a407-4bf9-ae4d-9bfded39a285","block_type":"box","text":"developed countries. In such a dynamic environment, there can be no assurance that any or all of these capital","page_number":79,"box":{"x":69,"y":521,"width":792,"height":11}},{"id":"862f6a01-a9da-4222-9fd4-615dddf249fc","block_type":"box","text":"markets will continue to present viable investment oppor tunities for a Fund. In the past, governments of such nations","page_number":79,"box":{"x":69,"y":536,"width":838,"height":11}},{"id":"a4226268-e25c-4df3-b4a8-21a7d43ca661","block_type":"box","text":"have expropriated substantial amounts of private proper ty, and most claims of the proper ty owners have never been","page_number":79,"box":{"x":69,"y":551,"width":828,"height":11}},{"id":"730ee520-9d92-4e70-a00c-1b6eb1d36f21","block_type":"box","text":"fully settled. There is no assurance that such expropriations will not reoccur. In such an event, it is possible that a","page_number":79,"box":{"x":68,"y":566,"width":816,"height":11}},{"id":"33e7e159-6eb9-44b3-a85f-32a9fab26af6","block_type":"box","text":"Fund could lose the entire value of its investments in the affected market. As a result the risks described above,","page_number":79,"box":{"x":70,"y":581,"width":802,"height":11}},{"id":"1fd6c2be-c814-4d70-ad91-973f032a34e6","block_type":"box","text":"including the risks of nationalization or expropriation of assets, may be heightened. In addition, unanticipated political","page_number":79,"box":{"x":70,"y":596,"width":838,"height":12}},{"id":"614eac92-103c-429b-b737-d29a0c2a2e54","block_type":"box","text":"or social developments may affect the value of investments in these countries and the availability to a Fund of","page_number":79,"box":{"x":69,"y":612,"width":788,"height":11}},{"id":"d8039efc-78b7-4c1f-9f6b-550b6d46adf0","block_type":"box","text":"additional investments. The small size and inexperience of the securities markets in cer tain of these countries and","page_number":79,"box":{"x":69,"y":627,"width":819,"height":11}},{"id":"502e72b3-6c0c-42bb-b6c4-d936d81f34d2","block_type":"box","text":"the limited volume of trading in securities in these countries may make investments in the countries illiquid and more","page_number":79,"box":{"x":68,"y":642,"width":838,"height":11}},{"id":"17a80122-bfef-433e-9cfd-d8b1181b3512","block_type":"box","text":"volatile than investments in more established markets.","page_number":79,"box":{"x":68,"y":657,"width":392,"height":9}},{"id":"e39c4055-48ce-47fc-8d24-aad6b8563327","block_type":"box","text":"Also, there may be less publicly available information about issuers in emerging markets than would be available","page_number":79,"box":{"x":101,"y":680,"width":805,"height":11}},{"id":"cbb2eb18-1b33-4147-8fd9-9a4e8b9fef35","block_type":"box","text":"about issuers in more developed capital markets, and such issuers may not be subject to accounting, auditing and","page_number":79,"box":{"x":69,"y":695,"width":818,"height":11}},{"id":"d5e36f31-2128-4cdf-9e17-63a16ff09eee","block_type":"box","text":"financial repor ting standards and requirements comparable to those to which U.S. companies are subject. In cer tain","page_number":79,"box":{"x":68,"y":710,"width":831,"height":11}},{"id":"0b12cbf6-0398-40f6-8854-95cc20c2c4ad","block_type":"box","text":"countries with emerging capital markets, repor ting standards vary widely. As a result, traditional investment","page_number":79,"box":{"x":69,"y":725,"width":768,"height":11}},{"id":"4f46ef51-d0a4-49ab-b134-28bc441a2b60","block_type":"box","text":"measurements used in the United States, such as price/earnings ratios, may not be applicable. Emerging market","page_number":79,"box":{"x":69,"y":740,"width":811,"height":11}},{"id":"d221b60f-07cd-464d-b114-6730a1081124","block_type":"box","text":"securities may be substantially less liquid than, and more volatile than, those of mature markets, and company","page_number":79,"box":{"x":69,"y":755,"width":795,"height":11}},{"id":"8543011a-5363-475b-a137-b2440d1e5ca4","block_type":"box","text":"shares may be held by a limited number of persons. This may adversely affect the timing and pricing of the Fund’s","page_number":79,"box":{"x":69,"y":770,"width":814,"height":12}},{"id":"2b1850b8-196f-4d99-acad-8799aceee547","block_type":"box","text":"acquisition or disposal of securities.","page_number":79,"box":{"x":69,"y":785,"width":257,"height":11}},{"id":"e04fad5b-00af-4c7d-ba20-2bf5d9946781","block_type":"box","text":"Practices in relation to settlement of securities transactions in emerging markets involve higher risks than those","page_number":79,"box":{"x":102,"y":808,"width":800,"height":11}},{"id":"b629310b-f74f-450a-b425-e423184fcf89","block_type":"box","text":"in developed markets, in par t because a Fund will need to use brokers and counterpar ties that are less well","page_number":79,"box":{"x":70,"y":823,"width":769,"height":11}},{"id":"57af4aad-10c4-4d2a-8f12-8fc1ddbb7b03","block_type":"box","text":"capitalized, and custody and registration of assets in some countries may be unreliable. The possibility of fraud,","page_number":79,"box":{"x":69,"y":838,"width":798,"height":12}},{"id":"d30137f9-d0b2-405b-a0e2-86d014dd6925","block_type":"box","text":"negligence, undue influence being exer ted by the issuer or refusal to recognize ownership exists in some emerging","page_number":79,"box":{"x":69,"y":853,"width":819,"height":12}},{"id":"9acd200b-63a3-4cca-880e-b212e2ba606e","block_type":"box","text":"markets, and, along with other factors, could result in ownership registration being completely lost. A Fund would","page_number":79,"box":{"x":69,"y":869,"width":804,"height":11}},{"id":"8b23158a-62b8-45f2-86ed-5421973ed110","block_type":"box","text":"absorb any loss resulting from such registration problems and may have no successful claim for compensation.","page_number":79,"box":{"x":69,"y":884,"width":794,"height":11}},{"id":"86470988-8926-4aa2-9042-b592b970880f","block_type":"box","text":"II-35","page_number":79,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"ac70589f-2437-4f90-95f8-a84549f272e7","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":79,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"9fa2835d-57eb-4c39-a66b-b1904fc52d81","block_type":"box","text":"Investment in non-dollar denominated securities including securities from issuers located in emerging market","page_number":80,"box":{"x":102,"y":45,"width":778,"height":11}},{"id":"78483013-6945-452a-86b6-1f00b913bc7d","block_type":"box","text":"countries may be on either a currency hedged or unhedged basis, and the Funds may hold from time to time various","page_number":80,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"b9808fae-e9be-46a4-a25e-526c1217d1c0","block_type":"box","text":"foreign currencies pending investment or conversion into U.S. dollars. Some of these instruments may have the","page_number":80,"box":{"x":68,"y":75,"width":797,"height":11}},{"id":"9bc184d2-2fed-47bd-8a18-c857e4e3ef73","block_type":"box","text":"characteristics of futures contracts. In addition, cer tain Funds may engage in foreign currency exchange transactions","page_number":80,"box":{"x":69,"y":90,"width":832,"height":11}},{"id":"3a9df520-2592-4861-a79a-903e5eabb085","block_type":"box","text":"to seek to protect against changes in the level of future exchange rates which would adversely affect the Fund’s","page_number":80,"box":{"x":68,"y":105,"width":799,"height":11}},{"id":"9f052335-a740-480f-9d83-b5d392c26bc7","block_type":"box","text":"per formance. These investments and transactions involving foreign securities, currencies, options (including options","page_number":80,"box":{"x":70,"y":120,"width":829,"height":12}},{"id":"cf668acc-4811-4f44-b0ad-a648415361b3","block_type":"box","text":"that relate to foreign currencies), futures, hedging and cross-hedging are described under “Derivatives.”","page_number":80,"box":{"x":68,"y":135,"width":740,"height":12}},{"id":"3f422ea5-6d80-48d1-8ae9-66f9c909dddf","block_type":"box","text":"Risks of Investing in Asia-Pacific Countries.","page_number":80,"box":{"x":102,"y":158,"width":305,"height":11}},{"id":"02a1645a-6a70-4c05-a28a-26038a313475","block_type":"box","text":"In addition to the risks of foreign investing and the risks of investing","page_number":80,"box":{"x":414,"y":158,"width":485,"height":11}},{"id":"2770fdb5-911c-455f-88e9-8fc05234da1c","block_type":"box","text":"in developing markets, the developing market Asia-Pacific countries in which a Fund may invest are subject to cer tain","page_number":80,"box":{"x":70,"y":173,"width":832,"height":11}},{"id":"2697e535-2daa-4876-a072-e6be78985e31","block_type":"box","text":"additional or specific risks. Cer tain Funds may make substantial investments in Asia-Pacific countries. In many of","page_number":80,"box":{"x":69,"y":188,"width":808,"height":11}},{"id":"3c02c9fb-7e4a-416c-9955-1e451b827b64","block_type":"box","text":"these markets, there is a high concentration of market capitalization and trading volume in a small number of issuers","page_number":80,"box":{"x":68,"y":203,"width":838,"height":12}},{"id":"16ae7ba1-bd94-48a0-8e1f-d22403947816","block_type":"box","text":"representing a limited number of industries, as well as a high concentration of investors and financial intermediaries.","page_number":80,"box":{"x":69,"y":218,"width":834,"height":12}},{"id":"80f1116e-05eb-48b3-9600-bcdfa44887eb","block_type":"box","text":"Many of these markets also may be affected by developments with respect to more established markets in the","page_number":80,"box":{"x":70,"y":234,"width":791,"height":11}},{"id":"fd78c79c-2592-4e77-a257-8b80aed31f96","block_type":"box","text":"region such as in Japan and Hong Kong. Brokers in developing market Asia-Pacific countries typically are fewer in","page_number":80,"box":{"x":69,"y":249,"width":804,"height":11}},{"id":"3e7959da-0ab2-4dc5-a016-8749dddc989c","block_type":"box","text":"number and less well capitalized than brokers in the United States. These factors, combined with the U.S. regulatory","page_number":80,"box":{"x":69,"y":264,"width":833,"height":11}},{"id":"2afa6b67-6b6b-44c2-8ad2-044f92ad2f04","block_type":"box","text":"requirements for open-end investment companies and the restrictions on foreign investment discussed below, result","page_number":80,"box":{"x":69,"y":279,"width":830,"height":11}},{"id":"7359b219-7e40-47bb-984e-31bfe2d95f5f","block_type":"box","text":"in potentially fewer investment oppor tunities for a Fund and may have an adverse impact on the investment","page_number":80,"box":{"x":70,"y":294,"width":766,"height":11}},{"id":"7ac1c0f8-56fd-452c-8e06-d1c16233cf0d","block_type":"box","text":"per formance of the Fund.","page_number":80,"box":{"x":70,"y":309,"width":179,"height":11}},{"id":"35491157-b898-42d2-9668-c4dc642bd8d8","block_type":"box","text":"Many of the developing market Asia-Pacific countries may be subject to a greater degree of economic, political","page_number":80,"box":{"x":102,"y":332,"width":784,"height":11}},{"id":"5476baf8-02de-447a-adf0-4b4d3a68902d","block_type":"box","text":"and social instability than is the case in the United States and Western European countries. Such instability may","page_number":80,"box":{"x":69,"y":347,"width":803,"height":11}},{"id":"59f55c04-7cc7-4746-b828-4ef060ffa7fd","block_type":"box","text":"result from, among other things: (i) authoritarian governments or military involvement in political and economic","page_number":80,"box":{"x":69,"y":362,"width":788,"height":11}},{"id":"ca68dff4-c1d3-4f69-9417-cf954f83e815","block_type":"box","text":"decision-making, including changes in government through extra-constitutional means; (ii) popular unrest associated","page_number":80,"box":{"x":69,"y":377,"width":827,"height":12}},{"id":"1d5d4009-636c-4b4a-a1fa-4be8c1cb16d3","block_type":"box","text":"with demands for improved political, economic and social conditions; (iii) internal insurgencies; (iv) hostile relations","page_number":80,"box":{"x":68,"y":392,"width":823,"height":12}},{"id":"455683bc-032d-427f-888a-0c9f8aba8dac","block_type":"box","text":"with neighboring countries; and (v) ethnic, religious and racial disaffection. In addition, the governments of many of","page_number":80,"box":{"x":68,"y":407,"width":822,"height":12}},{"id":"e923de45-874e-4c5f-848d-860c45df9711","block_type":"box","text":"such countries, such as Indonesia, have a substantial role in regulating and supervising the economy. Another risk","page_number":80,"box":{"x":69,"y":423,"width":818,"height":11}},{"id":"a0e57293-4e19-4c3c-b55a-d532d736da0a","block_type":"box","text":"common to most such countries is that the economy is heavily expor t oriented and, accordingly, is dependent upon","page_number":80,"box":{"x":69,"y":438,"width":821,"height":11}},{"id":"c0e8eefb-df95-4544-9067-f8a9d618fc32","block_type":"box","text":"international trade. The existence of overburdened infrastructure and obsolete financial systems also presents risks","page_number":80,"box":{"x":70,"y":453,"width":827,"height":11}},{"id":"0f3a8609-acfa-488b-8843-13b52cb569b1","block_type":"box","text":"in cer tain countries, as do environmental problems. Cer tain economies also depend to a significant degree upon","page_number":80,"box":{"x":70,"y":468,"width":803,"height":11}},{"id":"c9ddd34e-406f-4a71-be5e-875e324c6659","block_type":"box","text":"expor ts of primary commodities and, therefore, are vulnerable to changes in commodity prices that, in turn, may be","page_number":80,"box":{"x":69,"y":483,"width":824,"height":11}},{"id":"65e3db6a-59e9-4bde-8114-3cbffdaedf22","block_type":"box","text":"affected by a variety of factors.","page_number":80,"box":{"x":69,"y":498,"width":220,"height":11}},{"id":"63bf9cd5-f118-4aca-9208-fb6c21ec09af","block_type":"box","text":"The legal systems in cer tain developing market Asia-Pacific countries also may have an adverse impact on the","page_number":80,"box":{"x":101,"y":521,"width":785,"height":11}},{"id":"2291e080-1853-4e95-b39c-5dc98e3bd6cf","block_type":"box","text":"Fund. For example, while the potential liability of a shareholder in a U.S. corporation with respect to acts of the","page_number":80,"box":{"x":70,"y":536,"width":789,"height":11}},{"id":"31849338-ffb6-421f-a07a-3141db967399","block_type":"box","text":"corporation is generally limited to the amount of the shareholder’s investment, the notion of limited liability is less","page_number":80,"box":{"x":69,"y":551,"width":814,"height":11}},{"id":"57c1885e-add9-4694-8ed4-b4485ce1c968","block_type":"box","text":"clear in cer tain emerging market Asia-Pacific countries. Similarly, the rights of investors in developing market Asia","page_number":80,"box":{"x":69,"y":566,"width":813,"height":11}},{"id":"60a5993a-d641-4b4b-a8f5-c762a6b8dd42","block_type":"box","text":"Pacific companies may be more limited than those of shareholders of U.S. corporations. It may be difficult or","page_number":80,"box":{"x":69,"y":581,"width":777,"height":11}},{"id":"0865f8c9-4043-4e6a-bc53-a4a8a2b82437","block_type":"box","text":"impossible to obtain and/or enforce a judgment in a developing market Asia-Pacific country.","page_number":80,"box":{"x":70,"y":596,"width":652,"height":12}},{"id":"e4edb3d4-b1fd-4968-9633-969e2980be4e","block_type":"box","text":"Governments of many developing market Asia-Pacific countries have exercised and continue to exercise","page_number":80,"box":{"x":102,"y":619,"width":737,"height":11}},{"id":"a61e81ad-2391-4b0a-9c8f-424cc7e44258","block_type":"box","text":"substantial influence over many aspects of the private sector. In cer tain cases, the government owns or controls","page_number":80,"box":{"x":69,"y":634,"width":803,"height":12}},{"id":"be7c3ddc-0edb-4558-abae-5e63a36bea82","block_type":"box","text":"many companies, including the largest in the country. Accordingly, government actions in the future could have a","page_number":80,"box":{"x":69,"y":649,"width":801,"height":12}},{"id":"88265f04-4609-42cd-8cc7-1180618a268d","block_type":"box","text":"significant effect on economic conditions in developing market Asia-Pacific countries, which could affect private","page_number":80,"box":{"x":69,"y":664,"width":793,"height":12}},{"id":"37524226-cd89-439a-b4b7-c572e91f540c","block_type":"box","text":"sector companies and a Fund itself, as well as the value of securities in the Fund’s por tfolio. In addition, economic","page_number":80,"box":{"x":69,"y":680,"width":820,"height":11}},{"id":"2d5a7a8e-f049-4a1d-853a-dfc00b3db04f","block_type":"box","text":"statistics of developing market Asia-Pacific countries may be less reliable than economic statistics of more developed","page_number":80,"box":{"x":69,"y":695,"width":839,"height":11}},{"id":"32c23ce7-5c51-47ac-8cb5-33f530b6e1ba","block_type":"box","text":"nations.","page_number":80,"box":{"x":69,"y":710,"width":56,"height":9}},{"id":"245f920b-2548-4e3a-8da5-712663078082","block_type":"box","text":"In addition to the relative lack of publicly available information about developing market Asia-Pacific issuers and","page_number":80,"box":{"x":102,"y":732,"width":794,"height":12}},{"id":"a8d9665b-5f94-48f2-91ad-5e534e6564ca","block_type":"box","text":"the possibility that such issuers may not be subject to the same accounting, auditing and financial repor ting","page_number":80,"box":{"x":68,"y":748,"width":773,"height":11}},{"id":"3fe98014-89fd-42d6-a3fe-930bd1388088","block_type":"box","text":"standards as U.S. companies, inflation accounting rules in some developing market Asia-Pacific countries require","page_number":80,"box":{"x":69,"y":763,"width":808,"height":11}},{"id":"f55e6f6e-fd4a-4ce6-9e76-dbf894f1bfbd","block_type":"box","text":"companies that keep accounting records in the local currency, for both tax and accounting purposes, to restate","page_number":80,"box":{"x":69,"y":778,"width":791,"height":11}},{"id":"2be3aca9-1e30-4654-8e55-6a51dfd34eb7","block_type":"box","text":"cer tain assets and liabilities on the company’s balance sheet in order to express items in terms of currency of","page_number":80,"box":{"x":69,"y":793,"width":790,"height":11}},{"id":"3b5d3796-59f8-4898-96aa-1aedfd900877","block_type":"box","text":"constant purchasing power. Inflation accounting may indirectly generate losses or profits for cer tain developing","page_number":80,"box":{"x":69,"y":808,"width":790,"height":11}},{"id":"458e451c-7088-480c-a01f-33fb75be4c8d","block_type":"box","text":"market Asia-Pacific companies.","page_number":80,"box":{"x":69,"y":823,"width":220,"height":11}},{"id":"f2ab8c06-4b9a-4a59-a9dc-5c46666b61e5","block_type":"box","text":"Satisfactory custodial services for investment securities may not be available in some developing Asia-Pacific","page_number":80,"box":{"x":102,"y":846,"width":780,"height":11}},{"id":"b656b11e-a009-4494-8b45-3dd210124bd1","block_type":"box","text":"countries, which may result in the Fund incurring additional costs and delays in providing transpor tation and custody","page_number":80,"box":{"x":69,"y":861,"width":829,"height":11}},{"id":"31e2f14e-14d7-43c7-963a-f2aaf66d49ec","block_type":"box","text":"services for such securities outside such countries.","page_number":80,"box":{"x":69,"y":876,"width":367,"height":9}},{"id":"bbd0479e-6f30-4976-9e51-3f2c7e6d9b16","block_type":"box","text":"II-36","page_number":80,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f090f42d-312e-4154-81b9-1f192ec5644e","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":80,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"a3721df7-8d69-48cb-9d1b-0771f0066739","block_type":"box","text":"Cer tain developing Asia-Pacific countries, such as the Philippines, India and Turkey, are especially large debtors","page_number":81,"box":{"x":102,"y":45,"width":795,"height":11}},{"id":"b49b3350-1009-4560-a636-5696470dbecd","block_type":"box","text":"to commercial banks and foreign governments.","page_number":81,"box":{"x":68,"y":60,"width":335,"height":11}},{"id":"6f31b305-3183-489a-84e3-2ff417abf36c","block_type":"box","text":"Natural disasters in Asia-Pacific countries, and the resulting damage, could have a severe and negative impact","page_number":81,"box":{"x":102,"y":82,"width":788,"height":12}},{"id":"2d7947e3-0b64-467a-b8df-c71044e48739","block_type":"box","text":"on a Fund’s investment por tfolio and, in the longer term, could impair the ability of issuers in which the Fund invests","page_number":81,"box":{"x":69,"y":98,"width":830,"height":11}},{"id":"bd9ccc1f-51ab-4403-929d-2c1ddcdebbdd","block_type":"box","text":"to conduct their businesses in the manner normally conducted.","page_number":81,"box":{"x":68,"y":113,"width":450,"height":11}},{"id":"7a87c1a6-cfb6-467b-b8f7-caaca3415905","block_type":"box","text":"Fund management may determine that, notwithstanding otherwise favorable investment criteria, it may not be","page_number":81,"box":{"x":102,"y":135,"width":782,"height":12}},{"id":"1729e49c-04f1-42f6-9f2a-8b62892f1308","block_type":"box","text":"practicable or appropriate to invest in a par ticular developing Asia-Pacific country. A Fund may invest in countries in","page_number":81,"box":{"x":70,"y":150,"width":819,"height":12}},{"id":"f2c1adc8-ae95-4834-9168-12c8414a2f90","block_type":"box","text":"which foreign investors, including management of the Fund, have had no or limited prior experience.","page_number":81,"box":{"x":68,"y":166,"width":711,"height":11}},{"id":"076e786c-01d2-416e-bfd4-4d336e87d864","block_type":"box","text":"Restrictions on Foreign Investments in Asia-Pacific Countries.","page_number":81,"box":{"x":102,"y":188,"width":435,"height":12}},{"id":"09d2dc24-3c9d-4d3a-9390-b31d0659c319","block_type":"box","text":"Some developing Asia-Pacific countries prohibit or","page_number":81,"box":{"x":543,"y":188,"width":355,"height":12}},{"id":"8d5dfe6c-f5d7-499c-9d3f-47afb4c06c64","block_type":"box","text":"impose substantial restrictions on investments in their capital markets, par ticularly their equity markets, by foreign","page_number":81,"box":{"x":70,"y":203,"width":817,"height":12}},{"id":"2ca10db9-16fd-4dcb-ab30-fc629561950b","block_type":"box","text":"entities such as a Fund. As illustrations, cer tain countries may require governmental approval prior to investments by","page_number":81,"box":{"x":69,"y":219,"width":836,"height":11}},{"id":"06fa937a-b60b-4e96-b0b6-eeaf9bd87e00","block_type":"box","text":"foreign persons or limit the amount of investment by foreign persons in a par ticular company or limit the investment","page_number":81,"box":{"x":68,"y":234,"width":828,"height":11}},{"id":"31821799-0edc-4c1f-9a77-a619bbf0f8ce","block_type":"box","text":"by foreign persons to only a specific class of securities of a company which may have less advantageous terms","page_number":81,"box":{"x":69,"y":249,"width":794,"height":11}},{"id":"4b6003cb-8d88-48bf-b6d5-0c68bb996fce","block_type":"box","text":"(including price and shareholder rights) than securities of the company available for purchase by nationals. There can","page_number":81,"box":{"x":69,"y":264,"width":835,"height":11}},{"id":"3dd447b4-f93a-4bf9-afe4-35815a9c28c8","block_type":"box","text":"be no assurance that a Fund will be able to obtain required governmental approvals in a timely manner. In addition,","page_number":81,"box":{"x":69,"y":279,"width":820,"height":11}},{"id":"a0a408bd-c8f9-490b-acda-76d9f5a6d895","block_type":"box","text":"changes to restrictions on foreign ownership of securities subsequent to a Fund’s purchase of such securities may","page_number":81,"box":{"x":69,"y":294,"width":820,"height":11}},{"id":"8c3ab09c-3b66-4cd5-95ec-4db9f8de6cbf","block_type":"box","text":"have an adverse effect on the value of such shares. Cer tain countries may restrict investment oppor tunities in","page_number":81,"box":{"x":69,"y":309,"width":788,"height":11}},{"id":"32bf8981-5648-4fa2-9d38-0ac30d7071a7","block_type":"box","text":"issuers or industries deemed impor tant to national interests.","page_number":81,"box":{"x":70,"y":325,"width":434,"height":10}},{"id":"77fa82c0-6f35-4c28-b489-65f19ab070e8","block_type":"box","text":"The manner in which foreign investors may invest in companies in cer tain developing Asia-Pacific countries, as","page_number":81,"box":{"x":101,"y":347,"width":787,"height":11}},{"id":"4e7b2f1a-6d00-4ada-977c-afcc97160136","block_type":"box","text":"well as limitations on such investments, also may have an adverse impact on the operations of a Fund. For example,","page_number":81,"box":{"x":68,"y":362,"width":833,"height":11}},{"id":"f8c778e2-1aad-4950-9fc9-2ca54038455c","block_type":"box","text":"a Fund may be required in cer tain of such countries to invest initially through a local broker or other entity and then","page_number":81,"box":{"x":69,"y":377,"width":820,"height":12}},{"id":"3d36b763-caa7-4de3-b49f-95c77e6258ad","block_type":"box","text":"have the shares purchased re-registered in the name of the Fund. Re-registration may in some instances not be able","page_number":81,"box":{"x":69,"y":392,"width":831,"height":12}},{"id":"7d3c19b4-30a3-4efd-a57a-6af24384f665","block_type":"box","text":"to occur on a timely basis, resulting in a delay during which a Fund may be denied cer tain of its rights as an investor,","page_number":81,"box":{"x":68,"y":407,"width":834,"height":12}},{"id":"05e3e1ea-0a7d-44a8-b2f9-49ef20e2df0f","block_type":"box","text":"including rights as to dividends or to be made aware of cer tain corporate actions. There also may be instances where","page_number":81,"box":{"x":70,"y":423,"width":836,"height":11}},{"id":"606dd31b-7b23-4704-bc1a-128f6e641175","block_type":"box","text":"a Fund places a purchase order but is subsequently informed, at the time of re-registration, that the permissible","page_number":81,"box":{"x":69,"y":438,"width":800,"height":11}},{"id":"72947adf-eacc-4d03-bbb6-8959a4e92959","block_type":"box","text":"allocation of the investment to foreign investors has been filled, depriving the Fund of the ability to make its desired","page_number":81,"box":{"x":69,"y":453,"width":826,"height":11}},{"id":"15d4b05b-5f91-4089-b765-d886750ba08c","block_type":"box","text":"investment at that time.","page_number":81,"box":{"x":70,"y":468,"width":168,"height":9}},{"id":"18a38046-e924-44ec-ac2a-bc327f755a7b","block_type":"box","text":"Substantial limitations may exist in cer tain countries with respect to a Fund’s ability to repatriate investment","page_number":81,"box":{"x":102,"y":491,"width":774,"height":11}},{"id":"610b5b95-cd10-4408-a223-6e26ad5ad5c7","block_type":"box","text":"income, capital or the proceeds of sales of securities by foreign investors. A Fund could be adversely affected by","page_number":81,"box":{"x":70,"y":506,"width":803,"height":11}},{"id":"701bfbc1-898a-4c29-b275-20246f88c1b0","block_type":"box","text":"delays in, or a refusal to grant, any required governmental approval for repatriation of capital, as well as by the","page_number":81,"box":{"x":69,"y":521,"width":789,"height":11}},{"id":"a5ad07ba-4f25-447d-9b4d-79498298387e","block_type":"box","text":"application to the Fund of any restrictions on investments. It is possible that cer tain countries may impose currency","page_number":81,"box":{"x":69,"y":536,"width":826,"height":11}},{"id":"8d92a88d-f2cf-419c-b763-694b20730c92","block_type":"box","text":"controls or other restrictions relating to their currencies or to securities of issuers in those countries. To the extent","page_number":81,"box":{"x":69,"y":551,"width":818,"height":11}},{"id":"cad99f18-5264-45ea-8050-8bfd9a5f52c7","block_type":"box","text":"that such restrictions have the effect of making cer tain investments illiquid, securities may not be available for sale","page_number":81,"box":{"x":68,"y":566,"width":826,"height":11}},{"id":"bf6bb69b-6c0c-4eab-8f73-c7b203e7e608","block_type":"box","text":"to meet redemptions. Depending on a variety of financial factors, the percentage of a Fund’s por tfolio subject to","page_number":81,"box":{"x":68,"y":581,"width":800,"height":12}},{"id":"96608947-c80a-40d2-9e6c-a0a2e9be153a","block_type":"box","text":"currency controls may increase. In the event other countries impose similar controls, the por tion of the Fund’s assets","page_number":81,"box":{"x":69,"y":596,"width":839,"height":12}},{"id":"dc4b7527-7681-4202-a564-5cdd8b6567c2","block_type":"box","text":"that may be used to meet redemptions may be fur ther decreased. Even where there is no outright restriction on","page_number":81,"box":{"x":68,"y":612,"width":798,"height":11}},{"id":"13565bc3-3630-4360-966d-d4fc61d72961","block_type":"box","text":"repatriation of capital, the mechanics of repatriation may affect cer tain aspects of the operations of a Fund (for","page_number":81,"box":{"x":69,"y":627,"width":795,"height":11}},{"id":"33d99206-b470-4a2c-83b1-f18de1ee3d01","block_type":"box","text":"example, if funds may be withdrawn only in cer tain currencies and/or only at an exchange rate established by the","page_number":81,"box":{"x":69,"y":642,"width":808,"height":11}},{"id":"79d76a78-9a19-4743-b07b-b7cb78b3eef1","block_type":"box","text":"government).","page_number":81,"box":{"x":68,"y":657,"width":92,"height":11}},{"id":"8e754da8-d37d-426d-a8e0-a543f2720169","block_type":"box","text":"In cer tain countries, banks or other financial institutions may be among the leading companies or have actively","page_number":81,"box":{"x":102,"y":680,"width":790,"height":11}},{"id":"78d8c994-2f70-4da7-b00f-befced34758e","block_type":"box","text":"traded securities available for investment. The Investment Company Act restricts a Fund’s investments in any equity","page_number":81,"box":{"x":68,"y":695,"width":828,"height":11}},{"id":"d0e8f3a2-ee91-4938-8b1c-ead8cf417e9a","block_type":"box","text":"securities of an issuer that, in its most recent fiscal year, derived more than 15% of its revenues from “securities","page_number":81,"box":{"x":69,"y":710,"width":808,"height":11}},{"id":"65164270-9c30-4ec5-960f-11d570c56b65","block_type":"box","text":"related activities,” as defined by the rules thereunder. These provisions may restrict a Fund’s investments in cer tain","page_number":81,"box":{"x":69,"y":725,"width":829,"height":11}},{"id":"57eeb3da-c949-46e0-be2d-df2d8a6a51b4","block_type":"box","text":"foreign banks and other financial institutions.","page_number":81,"box":{"x":68,"y":740,"width":322,"height":11}},{"id":"a372f812-078b-433c-b135-5856ade689b9","block_type":"box","text":"Political and economic structures in emerging market countries may be undergoing significant evolution and","page_number":81,"box":{"x":102,"y":763,"width":767,"height":11}},{"id":"70ee351f-71e8-4290-a832-e1f95fc74777","block_type":"box","text":"rapid development, and these countries may lack the social, political and economic stability characteristic of more","page_number":81,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"20df8ed8-8611-44e2-bc3c-e9bfd2f91636","block_type":"box","text":"developed countries. Some of these countries may have in the past failed to recognize private proper ty rights and","page_number":81,"box":{"x":69,"y":793,"width":809,"height":11}},{"id":"33e13823-6e73-48f4-9bd5-7278a8cfb167","block_type":"box","text":"have at times nationalized or expropriated the assets of private companies. As a result the risks described above,","page_number":81,"box":{"x":69,"y":808,"width":812,"height":11}},{"id":"f6af9ee6-5335-4f3c-91ce-b49099f48c66","block_type":"box","text":"including the risks of nationalization or expropriation of assets, may be heightened. In addition, unanticipated political","page_number":81,"box":{"x":70,"y":823,"width":838,"height":12}},{"id":"2e67e127-69ea-46a4-89bb-9a05b6596866","block_type":"box","text":"or social developments may affect the value of investments in these countries and the availability to a Fund of","page_number":81,"box":{"x":69,"y":838,"width":788,"height":11}},{"id":"1a586f7e-0d53-4528-8249-3203a3a70ba8","block_type":"box","text":"additional investments in emerging market countries. The small size and inexperience of the securities markets in","page_number":81,"box":{"x":69,"y":853,"width":812,"height":12}},{"id":"241c60c2-dbeb-4e61-8c74-66f9ce175961","block_type":"box","text":"cer tain of these countries and the limited volume of trading in securities in these countries may make investments in","page_number":81,"box":{"x":69,"y":869,"width":835,"height":11}},{"id":"e154f154-f530-4e88-ad06-778122b9f201","block_type":"box","text":"the countries illiquid and more volatile than investments in Japan or most Western European countries. There may be","page_number":81,"box":{"x":68,"y":884,"width":837,"height":11}},{"id":"ae9c669f-1901-4694-8cd3-b681b460d64a","block_type":"box","text":"II-37","page_number":81,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"29c87002-43ab-4aaa-83d5-cb41275d140e","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":81,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"66992425-36ad-46c5-9335-15daa776cdb7","block_type":"box","text":"little financial or accounting information available with respect to issuers located in cer tain emerging market","page_number":82,"box":{"x":70,"y":45,"width":771,"height":11}},{"id":"12536c1b-e421-44d2-a8c0-ec5c999ba388","block_type":"box","text":"countries, and it may be difficult to assess the value or prospects of an investment in such issuers.","page_number":82,"box":{"x":69,"y":60,"width":711,"height":11}},{"id":"f66ad077-5d79-448d-b434-50bb83c75656","block_type":"box","text":"The expense ratios of the Funds investing significantly in foreign securities can be expected to be higher than","page_number":82,"box":{"x":101,"y":82,"width":779,"height":12}},{"id":"ac17b597-9743-4da7-84ec-b5252d605e07","block_type":"box","text":"those of Funds investing primarily in domestic securities. The costs attributable to investing abroad are usually higher","page_number":82,"box":{"x":68,"y":98,"width":840,"height":11}},{"id":"6d9a6011-9ea8-450f-bda3-56e8bcd0ca37","block_type":"box","text":"for several reasons, such as the higher cost of custody of foreign securities, higher commissions paid on comparable","page_number":82,"box":{"x":68,"y":113,"width":838,"height":11}},{"id":"6596d9d0-7471-4b88-8d86-b789ea6c0251","block_type":"box","text":"transactions on foreign markets and additional costs arising from delays in settlements of transactions involving","page_number":82,"box":{"x":68,"y":128,"width":802,"height":11}},{"id":"cbb1382a-4a52-40f1-bd96-6a05211f83d5","block_type":"box","text":"foreign securities.","page_number":82,"box":{"x":68,"y":143,"width":127,"height":11}},{"id":"88f740f2-f3ac-45e9-b197-c39a74ddde28","block_type":"box","text":"Risks of Investments in Russia.","page_number":82,"box":{"x":102,"y":166,"width":224,"height":9}},{"id":"4aabf8e0-2e0a-423e-a30b-b607ac9b8e5e","block_type":"box","text":"A Fund may invest a por tion of its assets in securities issued by companies","page_number":82,"box":{"x":332,"y":166,"width":539,"height":11}},{"id":"c82f7bfc-02b4-43d0-b4ee-ee01bec16650","block_type":"box","text":"located in Russia. The Russian securities market suffers from a variety of problems described above in “Investment","page_number":82,"box":{"x":70,"y":181,"width":826,"height":11}},{"id":"90267b54-f18d-4b3d-9b6d-f0823ade062d","block_type":"box","text":"in Emerging Markets” not encountered in more developed markets. The Russian securities market is relatively new,","page_number":82,"box":{"x":70,"y":196,"width":821,"height":11}},{"id":"8ab21a32-4594-4fe0-941e-3564ac842e4f","block_type":"box","text":"and a substantial por tion of securities transactions in Russia are privately negotiated outside of stock exchanges.","page_number":82,"box":{"x":69,"y":211,"width":812,"height":11}},{"id":"65d6491c-ef43-474e-b47b-4204490a6ff1","block_type":"box","text":"The inexperience of the Russian securities market and the limited volume of trading in securities in the market may","page_number":82,"box":{"x":68,"y":226,"width":824,"height":11}},{"id":"5c1f5182-b3cf-44cf-a862-88464b95645e","block_type":"box","text":"make obtaining accurate prices on por tfolio securities from independent sources more difficult than in more","page_number":82,"box":{"x":69,"y":241,"width":771,"height":11}},{"id":"955f0c90-7e9c-4a17-9f7b-5c0c75cd02b4","block_type":"box","text":"developed markets.","page_number":82,"box":{"x":69,"y":257,"width":138,"height":10}},{"id":"3fabe0bf-a152-4b89-b3c4-c782e399f040","block_type":"box","text":"Because of the underdeveloped state of Russia’s securities markets and banking and telecommunication","page_number":82,"box":{"x":102,"y":279,"width":751,"height":11}},{"id":"6f38f8f8-50d9-4669-bee2-b95f006d9e8f","block_type":"box","text":"systems, settlement, clearing and registration of securities transactions are subject to additional risks. Prior to 2013,","page_number":82,"box":{"x":69,"y":294,"width":839,"height":11}},{"id":"1edf5b2e-bb3a-4991-a7df-af6077fa433e","block_type":"box","text":"there was no central registration system for equity share registration in Russia and registration was carried out either","page_number":82,"box":{"x":68,"y":309,"width":838,"height":11}},{"id":"22d8263e-416a-442b-94d3-93efbfe35833","block_type":"box","text":"by the issuers themselves or by registrars located throughout Russia. These registrars may not have been subject to","page_number":82,"box":{"x":69,"y":325,"width":831,"height":11}},{"id":"dffab5be-5e61-491b-bbb3-5fad50e19360","block_type":"box","text":"effective state supervision or licensed with any governmental entity. In 2013, Russia established the National","page_number":82,"box":{"x":69,"y":339,"width":783,"height":12}},{"id":"af0f8db0-7d28-4d0f-bb18-1ce570956314","block_type":"box","text":"Settlement Depository (“NSD”) as a recognized central securities depository, and title to Russian equities held","page_number":82,"box":{"x":69,"y":355,"width":790,"height":11}},{"id":"93d31930-0178-43cb-95d8-46626f84af9e","block_type":"box","text":"through the NSD is now based on the records of the NSD and not on the records of the local registrars. Although the","page_number":82,"box":{"x":68,"y":370,"width":833,"height":11}},{"id":"fb8f4f67-3bdc-44b2-aacb-6427d9c07a16","block_type":"box","text":"implementation of the NSD has enhanced the efficiency and transparency of the Russian securities market, loss still","page_number":82,"box":{"x":70,"y":385,"width":831,"height":11}},{"id":"7a17700d-e83d-4685-b97a-0e000798c94d","block_type":"box","text":"can occur. Additionally, issuers and registrars remain prominent in the validation and approval of documentation","page_number":82,"box":{"x":69,"y":400,"width":797,"height":11}},{"id":"36984443-2fea-4815-a8ee-6df7b465a91b","block_type":"box","text":"requirements for corporate action processing in Russia, and, because the documentation requirements and approval","page_number":82,"box":{"x":69,"y":415,"width":832,"height":11}},{"id":"d7f71bde-4a8e-4eb2-9e5b-110b5cf5ec77","block_type":"box","text":"criteria vary between registrars and issuers, there remain inconsistent market standards in the Russian market with","page_number":82,"box":{"x":69,"y":430,"width":827,"height":11}},{"id":"4e37cda6-13c7-4a26-8f27-a64829fced9f","block_type":"box","text":"respect to the completion and submission of corporate action elections. To the extent that a Fund suffers a loss","page_number":82,"box":{"x":69,"y":445,"width":800,"height":11}},{"id":"39008597-a578-4cd1-a06d-28b93147b195","block_type":"box","text":"relating to title or corporate actions relating to its por tfolio securities, it may be difficult for the Fund to enforce its","page_number":82,"box":{"x":69,"y":460,"width":813,"height":12}},{"id":"c4052d5d-ccb7-4eed-833e-0cc9badf04ba","block_type":"box","text":"rights or otherwise remedy the loss. Russian securities laws may not recognize foreign nominee accounts held with a","page_number":82,"box":{"x":69,"y":475,"width":836,"height":12}},{"id":"39f91f89-4252-44c3-8f50-6aea62e8639f","block_type":"box","text":"custodian bank, and as a result the custodian may be considered the ultimate owner of securities held on behalf of","page_number":82,"box":{"x":69,"y":491,"width":824,"height":11}},{"id":"164f0102-d5e1-4d15-b5c8-31386c55d285","block_type":"box","text":"their clients. A Fund also may experience difficulty in obtaining and/or enforcing judgments in Russia.","page_number":82,"box":{"x":68,"y":506,"width":723,"height":11}},{"id":"c06e3d0f-886d-4d73-9fb8-e295e6057193","block_type":"box","text":"In addition, Russia continues to asser t its influence in the region through economic and military measures, as it","page_number":82,"box":{"x":102,"y":528,"width":801,"height":12}},{"id":"5316b175-d1ee-4786-b24b-e85a083dadb9","block_type":"box","text":"did with Georgia in the summer of 2008 and the Ukraine in 2014 and 2022. Russia launched a large-scale invasion","page_number":82,"box":{"x":69,"y":543,"width":826,"height":12}},{"id":"f1c026df-d11b-4a1f-9219-a956dace5e94","block_type":"box","text":"of Ukraine on February 24, 2022. The extent and duration of the military action, resulting sanctions and resulting","page_number":82,"box":{"x":69,"y":559,"width":809,"height":11}},{"id":"62d089bb-4862-42f1-bd46-a609dab26c3d","block_type":"box","text":"future market disruptions, including declines in its stock markets and the value of the ruble against the U.S. dollar,","page_number":82,"box":{"x":68,"y":574,"width":821,"height":11}},{"id":"313eb0b0-63a4-4db3-abcf-a0531dbbbc9b","block_type":"box","text":"are impossible to predict. Any such disruptions caused by Russian military action or other actions (including","page_number":82,"box":{"x":69,"y":589,"width":770,"height":11}},{"id":"74a09e0e-d9f8-4c1d-b2fb-d4368bc41ad6","block_type":"box","text":"cyberattacks and espionage) or resulting actual and threatened responses to such activity, including purchasing and","page_number":82,"box":{"x":69,"y":604,"width":827,"height":11}},{"id":"33cc6546-472d-4598-a7fc-9d14c3037ff0","block_type":"box","text":"financing restrictions, boycotts or changes in consumer or purchaser preferences, sanctions, tariffs or cyberattacks","page_number":82,"box":{"x":68,"y":619,"width":824,"height":11}},{"id":"da6b69df-ca0c-403d-ac15-27cbe13189a7","block_type":"box","text":"on the Russian government, Russian companies or Russian individuals, including politicians, may impact Russia’s","page_number":82,"box":{"x":69,"y":634,"width":814,"height":12}},{"id":"fcfc6754-3995-477c-a3fb-64b93b3546ce","block_type":"box","text":"economy and Russian issuers of securities in which the Fund invests. Actual and threatened responses to such","page_number":82,"box":{"x":69,"y":649,"width":795,"height":12}},{"id":"4b900218-ce8a-41f3-9c2e-eb636175e727","block_type":"box","text":"activity, including purchasing restrictions, sanctions, tariffs or cyberattacks on the Russian government or Russian","page_number":82,"box":{"x":69,"y":664,"width":814,"height":12}},{"id":"bcd58c93-7f58-4720-b6a9-a9870f4bb4ff","block_type":"box","text":"companies, may impact Russia’s economy and Russian issuers of securities in which the Fund invests. Actual and","page_number":82,"box":{"x":69,"y":680,"width":816,"height":11}},{"id":"37974448-583d-40c4-895e-e1c78285e14b","block_type":"box","text":"threatened responses to such military action may also impact the markets for cer tain Russian commodities, such as","page_number":82,"box":{"x":68,"y":695,"width":836,"height":11}},{"id":"59bbcc6c-a814-4560-aa75-7e3896ae22bf","block_type":"box","text":"oil and natural gas, as well as other sectors of the Russian economy, and may likely have collateral impacts on such","page_number":82,"box":{"x":69,"y":710,"width":829,"height":11}},{"id":"9d86a683-04cb-4ab7-a0d0-205317bfd283","block_type":"box","text":"sectors globally.","page_number":82,"box":{"x":69,"y":725,"width":112,"height":11}},{"id":"8ec1b908-90f0-4a61-83cb-1ab1b0f36534","block_type":"box","text":"Governments in the United States and many other countries (collectively, the “Sanctioning Bodies”) have","page_number":82,"box":{"x":102,"y":748,"width":745,"height":11}},{"id":"56f890ec-619b-4f68-95c1-9a395dd4c2d1","block_type":"box","text":"imposed economic sanctions, which can consist of prohibiting cer tain securities trades, cer tain private transactions","page_number":82,"box":{"x":70,"y":763,"width":826,"height":11}},{"id":"2c615a5c-ea9d-4f20-a3e4-30382b8da748","block_type":"box","text":"in the energy sector, asset freezes and prohibition of all business, against cer tain Russian individuals, including","page_number":82,"box":{"x":70,"y":778,"width":799,"height":11}},{"id":"d26e06df-881b-4655-bc2b-3c05a5a1be1b","block_type":"box","text":"politicians, and Russian corporate and banking entities. The Sanctioning Bodies, or others, could also institute","page_number":82,"box":{"x":70,"y":793,"width":788,"height":11}},{"id":"17e65890-d4d9-4c1c-a546-0072c720ca2a","block_type":"box","text":"broader sanctions on Russia, including banning Russia from global payments systems that facilitate cross-border","page_number":82,"box":{"x":69,"y":808,"width":807,"height":11}},{"id":"f2aa8020-6a6c-4ab4-8f6d-986ae8a94e26","block_type":"box","text":"payments. These sanctions, or even the threat of fur ther sanctions, may result in the decline of the value and","page_number":82,"box":{"x":70,"y":823,"width":782,"height":11}},{"id":"7d91cc5f-cecf-41b5-8179-0d4f017f7a67","block_type":"box","text":"liquidity of Russian securities, a weakening of the ruble or other adverse consequences to the Russian economy.","page_number":82,"box":{"x":70,"y":838,"width":802,"height":12}},{"id":"68ca51e1-8dc6-4134-b75e-db467d4d675f","block_type":"box","text":"These sanctions have resulted and may continue to result in the immediate freeze of Russian securities and/or","page_number":82,"box":{"x":68,"y":853,"width":797,"height":12}},{"id":"4f64bda1-7901-4a2f-a55b-4a6eb3af88a5","block_type":"box","text":"funds invested in prohibited assets, impairing the ability of a Fund to buy, sell, receive or deliver those securities","page_number":82,"box":{"x":68,"y":869,"width":804,"height":11}},{"id":"bfbb323f-a0c3-4da7-874c-13e086a09fce","block_type":"box","text":"and/or assets. Sanctions could also result in Russia taking counter measures or retaliatory actions which may","page_number":82,"box":{"x":69,"y":884,"width":791,"height":11}},{"id":"d713cf87-7feb-407c-b035-d0afb8df8a56","block_type":"box","text":"fur ther impair the value and liquidity of Russian securities.","page_number":82,"box":{"x":68,"y":899,"width":417,"height":11}},{"id":"6e2d1f02-ca50-42b6-8814-6683644cc1e3","block_type":"box","text":"II-38","page_number":82,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"c81641db-5e99-419d-b139-baf8a6fb54c7","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":82,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"95fb191c-7517-40b2-9688-51ddbe56735c","block_type":"box","text":"Risks of Investing in Saudi Arabia.","page_number":83,"box":{"x":102,"y":45,"width":241,"height":11}},{"id":"a85ebc05-283e-4091-b266-ff717ad67658","block_type":"box","text":"The ability of foreign investors (such as a Fund) to invest in Saudi Arabian","page_number":83,"box":{"x":350,"y":45,"width":523,"height":11}},{"id":"7ad9fd4f-6770-4b70-8e14-fd24abb825fe","block_type":"box","text":"issuers is new and untested. Such ability could be restricted or revoked by the Saudi Arabian government at any time,","page_number":83,"box":{"x":70,"y":60,"width":838,"height":11}},{"id":"47595e92-87c3-452d-ae10-f48df1429514","block_type":"box","text":"and unforeseen risks could materialize due to foreign ownership in such securities. In addition, the Capital Market","page_number":83,"box":{"x":69,"y":75,"width":814,"height":11}},{"id":"7eda2cc7-cb0e-4030-989a-234ae94e1e98","block_type":"box","text":"Authority (“CMA”) places investment limitations on the ownership of Saudi Arabian issuers by foreign investors,","page_number":83,"box":{"x":68,"y":90,"width":793,"height":11}},{"id":"bfee03b0-e5d2-4986-9f1c-55fe6935f7cd","block_type":"box","text":"including a limitation on a Fund’s ownership of any single issuer listed on the Saudi Arabian Stock Exchange, which","page_number":83,"box":{"x":70,"y":105,"width":819,"height":11}},{"id":"8edd0b3d-60f4-4cad-bde0-859700c2ccf8","block_type":"box","text":"may prevent a Fund from investing in accordance with its strategy and contribute to tracking error against the","page_number":83,"box":{"x":69,"y":120,"width":777,"height":12}},{"id":"0377613e-64fa-4af4-922e-a35ad1bb33f7","block_type":"box","text":"Underlying Index. These restrictions may be changed or new restrictions, such as licensing requirements, special","page_number":83,"box":{"x":70,"y":136,"width":803,"height":11}},{"id":"9facb8f6-9120-4c00-be20-1ac51dc0905b","block_type":"box","text":"approvals or additional foreign taxes, may be instituted at any time. A Fund may not be able to obtain or maintain any","page_number":83,"box":{"x":69,"y":150,"width":837,"height":12}},{"id":"34567722-8139-44e2-bb2c-a968b0867e07","block_type":"box","text":"such licenses or approvals and may not be able to buy and sell securities at full value. Major disruptions or","page_number":83,"box":{"x":69,"y":166,"width":765,"height":11}},{"id":"80cb43e6-5106-4736-a0ff-bf39ecccc012","block_type":"box","text":"regulatory changes could occur in the Saudi Arabian market, any of which could negatively impact a Fund. These risks","page_number":83,"box":{"x":69,"y":181,"width":838,"height":11}},{"id":"ac36372d-7609-4559-9591-694ee5307f4e","block_type":"box","text":"may be exacerbated, compared to more developed markets, given the limited history of foreign investment in the","page_number":83,"box":{"x":69,"y":196,"width":805,"height":11}},{"id":"caed1138-303e-471b-bf57-122f9ca09791","block_type":"box","text":"Saudi Arabian market. Investments in Saudi Arabia may also be subject to loss due to expropriation or nationalization","page_number":83,"box":{"x":69,"y":211,"width":837,"height":11}},{"id":"c0d7fbca-0c84-43b6-8dcc-cf35e8d64593","block_type":"box","text":"of assets and proper ty or the imposition of restrictions on additional foreign investments and repatriation of capital.","page_number":83,"box":{"x":69,"y":226,"width":826,"height":11}},{"id":"e17f7d54-6ba2-4e64-99bf-2bf87786c63c","block_type":"box","text":"Such heightened risks may include, among others, restrictions on and government intervention in international trade,","page_number":83,"box":{"x":69,"y":241,"width":834,"height":11}},{"id":"8426f52e-8e8d-4947-8905-e014337b6876","block_type":"box","text":"confiscatory taxation, political instability, including authoritarian and/or military involvement in governmental decision","page_number":83,"box":{"x":69,"y":256,"width":835,"height":12}},{"id":"583a5870-b794-4a2a-a647-7bed11766ec5","block_type":"box","text":"making, armed conflict, crime and instability as a result of religious, ethnic and/or socioeconomic unrest. Saudi","page_number":83,"box":{"x":69,"y":271,"width":797,"height":12}},{"id":"75f464ea-bbcb-47b0-a705-77f945c3ca30","block_type":"box","text":"Arabia has privatized, or has begun the process of privatizing, cer tain entities and industries. Newly privatized","page_number":83,"box":{"x":68,"y":286,"width":781,"height":12}},{"id":"7870162a-f749-4f81-900f-033ca6f8273b","block_type":"box","text":"companies may face strong competition from government-sponsored competitors that have not been privatized. In","page_number":83,"box":{"x":69,"y":302,"width":811,"height":11}},{"id":"1bb2d1cb-2c56-4552-9ddf-5e6e0b8a107d","block_type":"box","text":"some instances, investors in newly privatized entities have suffered losses due to the inability of the newly privatized","page_number":83,"box":{"x":69,"y":317,"width":833,"height":11}},{"id":"045d786f-f471-4c48-95db-577bf7620180","block_type":"box","text":"entities to adjust quickly to a competitive environment or changing regulatory and legal standards or, in some cases,","page_number":83,"box":{"x":69,"y":332,"width":831,"height":11}},{"id":"5e6e3b50-d002-4211-9948-05a0b26a9ab1","block_type":"box","text":"due to re-nationalization of such privatized entities. There is no assurance that similar losses will not recur. Fur ther,","page_number":83,"box":{"x":69,"y":347,"width":823,"height":11}},{"id":"56ace5b2-44c5-438a-a7be-d35fa137f20f","block_type":"box","text":"under income tax laws imposed by the Depar tment of Zakat and Income Tax, dividends paid by a Saudi Arabian","page_number":83,"box":{"x":69,"y":362,"width":791,"height":11}},{"id":"aedd4921-f764-4411-badf-38d7c1244723","block_type":"box","text":"company to foreign stockholders are generally subject to a 5% withholding tax (different tax rates may apply pursuant","page_number":83,"box":{"x":69,"y":377,"width":835,"height":12}},{"id":"ca63751a-d73f-4078-b507-eca6ec6933fb","block_type":"box","text":"to an applicable treaty). Saudi Arabia is highly reliant on income from the sale of petroleum and trade with other","page_number":83,"box":{"x":68,"y":392,"width":799,"height":12}},{"id":"624c38a0-bafc-4dc6-a7a4-c9d3a8cce78e","block_type":"box","text":"countries involved in the sale of petroleum, and its economy is therefore vulnerable to changes in foreign currency","page_number":83,"box":{"x":69,"y":407,"width":815,"height":12}},{"id":"ccfc2c73-a36c-492a-b147-ca7254477a42","block_type":"box","text":"values and the market for petroleum. As global demand for petroleum fluctuates, Saudi Arabia may be significantly","page_number":83,"box":{"x":68,"y":423,"width":818,"height":11}},{"id":"d31bbed2-4600-4ebc-9ac0-45daf5f4584d","block_type":"box","text":"impacted.","page_number":83,"box":{"x":70,"y":438,"width":67,"height":11}},{"id":"d5c46cd1-c807-46ac-b729-ba9f10f79b78","block_type":"box","text":"Like most Middle Eastern governments, the government of Saudi Arabia exercises substantial influence over","page_number":83,"box":{"x":102,"y":460,"width":773,"height":12}},{"id":"2e43d3c9-d53f-4ee1-9ec0-560d4e980ea9","block_type":"box","text":"many aspects of the private sector. Although liberalization in the wider economy is underway, in many areas it has","page_number":83,"box":{"x":69,"y":475,"width":812,"height":12}},{"id":"db2e9cf4-fcfe-4a01-bf03-54ce71d1eb62","block_type":"box","text":"lagged significantly: restrictions on foreign ownership persist, and the government has an ownership stake in many","page_number":83,"box":{"x":70,"y":491,"width":818,"height":11}},{"id":"7855c5a3-bc9b-4650-9e71-712f619b2a5e","block_type":"box","text":"key industries. The situation is exacerbated by the fact that Saudi Arabia is governed by an absolute monarchy. Saudi","page_number":83,"box":{"x":69,"y":506,"width":836,"height":11}},{"id":"2b384e07-603f-4661-b279-ba25c93f0839","block_type":"box","text":"Arabia has historically experienced strained relations with economic par tners worldwide, including other countries in","page_number":83,"box":{"x":68,"y":521,"width":826,"height":11}},{"id":"4c1d9c24-cdb6-40a1-b85b-ecd0e891a14d","block_type":"box","text":"the Middle East due to geopolitical events. Incidents involving a Middle Eastern country’s or the region’s security,","page_number":83,"box":{"x":68,"y":536,"width":809,"height":11}},{"id":"dae35508-3a68-445c-b99e-3bca3b9525f0","block_type":"box","text":"including terrorism, may cause uncer tainty in their markets and may adversely affect its economy and a Fund’s","page_number":83,"box":{"x":70,"y":551,"width":790,"height":11}},{"id":"2b62ec17-db81-4504-bbeb-63f8cc927c8c","block_type":"box","text":"investments. Governmental actions in the future could have a significant effect on economic conditions in Saudi","page_number":83,"box":{"x":70,"y":566,"width":798,"height":11}},{"id":"a7678447-353c-4a03-ae7b-d77df7aece15","block_type":"box","text":"Arabia, which could affect private sector companies and a Fund, as well as the value of securities in a Fund’s","page_number":83,"box":{"x":68,"y":581,"width":781,"height":11}},{"id":"cd18981e-822e-41b4-80ba-b5292648cb14","block_type":"box","text":"por tfolio. Any economic sanctions on Saudi Arabian individuals or Saudi Arabian corporate entities, or even the threat","page_number":83,"box":{"x":70,"y":596,"width":836,"height":12}},{"id":"b0ed69e9-c270-4eb6-9091-e873af2635d8","block_type":"box","text":"of sanctions, may result in the decline of the value and liquidity of Saudi Arabian securities, a weakening of the Saudi","page_number":83,"box":{"x":69,"y":612,"width":837,"height":11}},{"id":"17022dc1-fe4b-4d30-8f8f-5f9b84782ae3","block_type":"box","text":"riyal or other adverse consequences to the Saudi Arabian economy. In addition, Saudi Arabia’s economy relies heavily","page_number":83,"box":{"x":69,"y":627,"width":838,"height":11}},{"id":"ade7051f-e3c1-4e6e-a010-89f789e5fc6b","block_type":"box","text":"on cheap, foreign labor, and changes in the availability of this labor supply could have an adverse effect on the","page_number":83,"box":{"x":69,"y":642,"width":790,"height":11}},{"id":"a6b3d117-3e4f-4074-8f74-aa28654f04c5","block_type":"box","text":"economy.","page_number":83,"box":{"x":69,"y":659,"width":65,"height":9}},{"id":"06954a25-4574-46b5-8c1b-40689cac72e0","block_type":"box","text":"The securities markets in Saudi Arabia may not be as developed as those in other countries. As a result,","page_number":83,"box":{"x":101,"y":680,"width":747,"height":11}},{"id":"a81fa91c-f6c0-46d5-b0c2-177605f4dc89","block_type":"box","text":"securities markets in Saudi Arabia are subject to greater risks associated with market volatility, lower market","page_number":83,"box":{"x":69,"y":695,"width":776,"height":11}},{"id":"cab5b051-7167-473a-80b3-c89f9b38d60f","block_type":"box","text":"capitalization, lower trading volume, illiquidity, inflation, greater price fluctuations, uncer tainty regarding the existence","page_number":83,"box":{"x":69,"y":710,"width":836,"height":11}},{"id":"ef2c4ce8-296b-439e-a576-8f403e717e99","block_type":"box","text":"of trading markets, governmental control and heavy regulation of labor and industry. Shares of cer tain Saudi Arabian","page_number":83,"box":{"x":69,"y":725,"width":830,"height":11}},{"id":"0000bae6-8650-48b0-81ca-ee6b84f01044","block_type":"box","text":"companies tend to trade less frequently than those of companies on exchanges in more developed markets. Such","page_number":83,"box":{"x":69,"y":740,"width":813,"height":11}},{"id":"f955080d-4106-4ea2-a92a-b4cd1273216b","block_type":"box","text":"infrequent trading may adversely affect the pricing of these securities and a Fund’s ability to sell these securities in","page_number":83,"box":{"x":70,"y":755,"width":822,"height":11}},{"id":"401a0f08-0846-4969-8fa6-2d701d9eb09d","block_type":"box","text":"the future. Current regulations in Saudi Arabian markets may require a Fund to execute trades of securities through a","page_number":83,"box":{"x":68,"y":770,"width":837,"height":12}},{"id":"5bbd14e1-6866-49f0-85cd-be4f5d72fd7b","block_type":"box","text":"single broker. As a result, the Manager will have less flexibility to choose among brokers on behalf of a Fund than is","page_number":83,"box":{"x":69,"y":785,"width":826,"height":12}},{"id":"ac6c644a-aa17-44e8-9528-cddfe08b3b04","block_type":"box","text":"typically the case for investment managers.","page_number":83,"box":{"x":68,"y":801,"width":309,"height":11}},{"id":"55515050-4bf8-44a0-ba2e-184b8da7d2f4","block_type":"box","text":"Although the political situation in Saudi Arabia is largely stable, Saudi Arabia has historically experienced political","page_number":83,"box":{"x":101,"y":823,"width":806,"height":12}},{"id":"9a6abe17-8b2d-48f4-b913-70abfc4042fe","block_type":"box","text":"instability, and there remains the possibility that the stability will not hold in the future or that instability in the larger","page_number":83,"box":{"x":70,"y":838,"width":828,"height":12}},{"id":"1e8e1f4a-d48b-4de0-8efe-cbb78f9a8c20","block_type":"box","text":"Middle East region could adversely impact the economy of Saudi Arabia. Instability may be caused by military","page_number":83,"box":{"x":70,"y":853,"width":777,"height":12}},{"id":"82a50c9c-7252-4690-b7bf-e19d5e9b7db0","block_type":"box","text":"developments, government interventions in the marketplace, terrorism, extremist attitudes, attempted social or","page_number":83,"box":{"x":69,"y":869,"width":796,"height":11}},{"id":"8618e0cc-2ea1-4fa7-b1a6-69cdc061591d","block_type":"box","text":"political reforms, religious differences, or other factors. Additionally, anti-Western views held by cer tain groups in the","page_number":83,"box":{"x":70,"y":884,"width":830,"height":11}},{"id":"c17887ad-3ea4-4ae9-a4b3-b9ba33d16cef","block_type":"box","text":"Middle East may influence government policies regarding foreign investment. Fur ther developments in U.S. relations","page_number":83,"box":{"x":70,"y":899,"width":827,"height":11}},{"id":"8882b215-7e02-4634-816a-2a3eb0e3f8e0","block_type":"box","text":"II-39","page_number":83,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"21cdcccf-8ab2-417e-965d-88ef124c236b","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":83,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"38ad3173-b2d7-4612-af4a-5ec0eecfe940","block_type":"box","text":"with Saudi Arabia and other Middle-Eastern countries may affect these attitudes and policies. The U.S. is a","page_number":84,"box":{"x":68,"y":45,"width":764,"height":11}},{"id":"c67f7657-cedc-4973-a0d8-2c2709f7de1d","block_type":"box","text":"significant, and in some cases the most significant, trading par tner of, or foreign investor in, Saudi Arabia. As a","page_number":84,"box":{"x":69,"y":60,"width":795,"height":11}},{"id":"d8bd7b1c-6ab1-4e95-ba9c-2ccb352b8c90","block_type":"box","text":"result, economic conditions of Saudi Arabia may be par ticularly affected by changes in the U.S. economy. A decrease","page_number":84,"box":{"x":69,"y":75,"width":835,"height":11}},{"id":"e7e496d4-20e8-44ee-bef4-931634d11a2f","block_type":"box","text":"in U.S. impor ts or expor ts, new trade and financial regulations or tariffs, changes in the U.S. dollar exchange rate or","page_number":84,"box":{"x":70,"y":90,"width":829,"height":11}},{"id":"e63b5730-b4c4-448e-a6c5-22f488c06e4a","block_type":"box","text":"an economic slowdown in the U.S. may have a material adverse effect on the economic conditions of Saudi Arabia","page_number":84,"box":{"x":69,"y":105,"width":815,"height":11}},{"id":"68049fd4-59c8-4434-912f-57290bebaee1","block_type":"box","text":"and, as a result, securities to which the Fund has exposure. Political instability in Nor th Africa and the larger Middle","page_number":84,"box":{"x":69,"y":120,"width":825,"height":12}},{"id":"eb3cc0c5-fe78-4f1d-8efc-a040bbf438b7","block_type":"box","text":"East region has caused significant disruptions to many industries. Continued political and social unrest in these","page_number":84,"box":{"x":70,"y":135,"width":797,"height":12}},{"id":"6b5b076a-23b1-43cb-85f6-e7154eb19623","block_type":"box","text":"areas may negatively affect the value of securities in a Fund’s por tfolio.","page_number":84,"box":{"x":69,"y":150,"width":510,"height":12}},{"id":"477e9901-6ff2-4cf6-bd48-e518b1e73d1e","block_type":"box","text":"Cer tain issuers located in Saudi Arabia may operate in, or have dealings with, countries subject to sanctions","page_number":84,"box":{"x":102,"y":173,"width":773,"height":11}},{"id":"9876bada-97a1-4b7f-b26f-0defd954861e","block_type":"box","text":"and/or embargoes imposed by the U.S. Government and the United Nations and/or countries identified by the U.S.","page_number":84,"box":{"x":69,"y":188,"width":820,"height":12}},{"id":"c30802f7-7557-48cb-abe5-396dfbfd7878","block_type":"box","text":"Government as state sponsors of terrorism. As a result, an issuer may sustain damage to its reputation if it is","page_number":84,"box":{"x":69,"y":203,"width":787,"height":12}},{"id":"fe31092b-7eb6-486e-a6f4-bf90b85e5e78","block_type":"box","text":"identified as an issuer which operates in, or has dealings with, such countries. A Fund, as an investor in such issuers","page_number":84,"box":{"x":70,"y":218,"width":837,"height":12}},{"id":"1ecdbfbf-3b6a-4aab-8b88-f59ce8dde90a","block_type":"box","text":"will be indirectly subject to those risks.","page_number":84,"box":{"x":68,"y":234,"width":277,"height":11}},{"id":"30958941-1a84-4f04-9e8a-f7ef77512efd","block_type":"box","text":"Risks of Investing in Venezuela.","page_number":84,"box":{"x":102,"y":256,"width":223,"height":12}},{"id":"ec5f65f7-68a3-4229-b1c3-eb38dc951eed","block_type":"box","text":"Investment in Venezuela may subject a Fund to legal, regulatory, political,","page_number":84,"box":{"x":332,"y":257,"width":521,"height":11}},{"id":"1320c7de-84f7-413d-ba0d-9ebeb716c0f3","block_type":"box","text":"currency, security, expropriation and/or nationalization of assets and economic risk specific to Venezuela. Venezuela","page_number":84,"box":{"x":69,"y":271,"width":829,"height":12}},{"id":"86db9082-acc5-41d3-9004-990c3183b962","block_type":"box","text":"is extremely well endowed with natural resources, including oil and natural gas, and its economy is heavily dependent","page_number":84,"box":{"x":70,"y":287,"width":837,"height":11}},{"id":"ed47e25e-d79c-4fb4-b29c-af3d6f2ab315","block_type":"box","text":"on expor t of natural resources to key trading par tners. Any act of terrorism, an armed conflict or a breakdown of a","page_number":84,"box":{"x":69,"y":302,"width":813,"height":11}},{"id":"c1d33276-9e59-4c71-ae2e-90f0495884f5","block_type":"box","text":"key trading relationship that disrupts the production or expor t of natural resources will likely negatively affect the","page_number":84,"box":{"x":69,"y":317,"width":804,"height":11}},{"id":"b58c5a24-e5ad-4a47-a606-009950414ae8","block_type":"box","text":"Venezuelan economy. The government continues to control key sectors of the economy, including upstream oil and","page_number":84,"box":{"x":68,"y":332,"width":816,"height":11}},{"id":"e604a86d-9d75-4b4d-a755-b5dfedad2772","block_type":"box","text":"gas production, and has sought to increase its role in key sectors, such as telecommunications and steel.","page_number":84,"box":{"x":68,"y":347,"width":758,"height":11}},{"id":"f10a5e1c-6eaa-46ce-9589-43a9c5e472f6","block_type":"box","text":"Meanwhile, ambiguities in the investment environment remain, such as continued high levels of bureaucracy and","page_number":84,"box":{"x":70,"y":362,"width":803,"height":11}},{"id":"70dd073a-e3b7-4e7c-b59d-222ebbd1ccc0","block_type":"box","text":"corruption, large macroeconomic imbalances, and political and policy uncer tainty. Friction continues between the","page_number":84,"box":{"x":69,"y":377,"width":804,"height":12}},{"id":"2e6c8cf9-7539-4c51-b3ed-51f07d781ca4","block_type":"box","text":"governments of the U.S. and Venezuela. The U.S. has imposed economic sanctions, which consist of asset freezes","page_number":84,"box":{"x":68,"y":392,"width":822,"height":12}},{"id":"9c6a7f82-9392-419d-a71c-dea65b895268","block_type":"box","text":"and sectoral sanctions, on cer tain Venezuelan individuals and Venezuelan corporate entities, and on the Venezuelan","page_number":84,"box":{"x":69,"y":408,"width":827,"height":10}},{"id":"40767bb8-3efa-4614-be3c-bd40d155c8ef","block_type":"box","text":"government. The U.S. could also institute broader sanctions on Venezuela. The U.S. has also taken military action","page_number":84,"box":{"x":68,"y":423,"width":814,"height":11}},{"id":"4234c1be-a6d1-4d10-8563-78179566f71a","block_type":"box","text":"against Venezuela in an effor t to effect regime change. Military action, sanctions, or even the threat of fur ther","page_number":84,"box":{"x":69,"y":438,"width":787,"height":11}},{"id":"fed13ee8-1ca1-47b3-8c10-4b553135ea17","block_type":"box","text":"military action and sanctions, may result in the decline of the value and liquidity of Venezuelan securities, a","page_number":84,"box":{"x":69,"y":453,"width":766,"height":11}},{"id":"581cf747-fa6f-4ca7-88a1-c98d6534cfdd","block_type":"box","text":"weakening of the bolivar or other adverse consequences to the Venezuelan economy. These sanctions impair the","page_number":84,"box":{"x":68,"y":468,"width":804,"height":11}},{"id":"d3a29ba3-ce7a-45dd-a51d-62d6d1ab33d0","block_type":"box","text":"ability of a Fund to buy, sell, receive or deliver those securities and/or assets. Additional sanctions against Venezuela","page_number":84,"box":{"x":69,"y":483,"width":838,"height":11}},{"id":"773762fd-830f-41c1-bb6d-22b4838ecd50","block_type":"box","text":"may in the future be imposed by the U.S. or other countries. These factors, among others, can have a negative","page_number":84,"box":{"x":69,"y":498,"width":790,"height":11}},{"id":"b76d5086-a2ae-45a6-a642-22c1d1766f0a","block_type":"box","text":"impact on a Fund’s investments.","page_number":84,"box":{"x":70,"y":514,"width":230,"height":10}},{"id":"326e2394-f6f5-4ede-9582-4dedaf599b90","block_type":"box","text":"Brady Bonds.","page_number":84,"box":{"x":102,"y":536,"width":92,"height":11}},{"id":"cfd540d5-cbcf-4690-b6d8-d2d069249009","block_type":"box","text":"Cer tain Funds may invest in Brady Bonds. A Fund’s emerging market debt securities may include","page_number":84,"box":{"x":201,"y":536,"width":689,"height":11}},{"id":"4d442838-1c11-4e83-912c-2039ac51786f","block_type":"box","text":"emerging market governmental debt obligations commonly referred to as Brady Bonds. Brady Bonds are securities","page_number":84,"box":{"x":69,"y":551,"width":815,"height":11}},{"id":"1a2260ba-80bd-40d9-9c81-e6f5b29f0b1c","block_type":"box","text":"created through the exchange of existing commercial bank loans to sovereign entities for new obligations in","page_number":84,"box":{"x":69,"y":566,"width":766,"height":11}},{"id":"20eed3af-5477-44e4-9e4c-aa0242188943","block_type":"box","text":"connection with debt restructurings under a debt restructuring plan introduced by former U.S. Secretary of the","page_number":84,"box":{"x":69,"y":581,"width":784,"height":12}},{"id":"a2605916-7c05-4f19-adb6-383a62904cd9","block_type":"box","text":"Treasury, Nicholas F. Brady (the “Brady Plan”). Brady Plan debt restructurings have been implemented in a number of","page_number":84,"box":{"x":68,"y":596,"width":837,"height":12}},{"id":"fe94ff9a-c6ca-4af5-9dee-1e8aa96d2357","block_type":"box","text":"countries, including: Argentina, Bolivia, Brazil, Bulgaria, Costa Rica, the Dominican Republic, Ecuador, Jordan, Mexico,","page_number":84,"box":{"x":69,"y":612,"width":839,"height":11}},{"id":"97d68b91-414b-4541-9fbc-60bef971491b","block_type":"box","text":"Niger, Nigeria, Panama, Peru, the Philippines, Poland, Uruguay, Venezuela, and Vietnam. Beginning in the early","page_number":84,"box":{"x":70,"y":627,"width":786,"height":11}},{"id":"a93b02a2-2831-4186-b9d7-0128e30db25b","block_type":"box","text":"2000s, cer tain countries began retiring their Brady Bonds, including Brazil, Colombia, Mexico, the Philippines, and","page_number":84,"box":{"x":69,"y":642,"width":814,"height":11}},{"id":"512c4c99-0d42-4864-ba91-161db0889c0d","block_type":"box","text":"Venezuela.","page_number":84,"box":{"x":68,"y":657,"width":75,"height":9}},{"id":"e85eda50-2ca2-48de-aa28-c389f373254a","block_type":"box","text":"Brady Bonds may be collateralized or uncollateralized, are issued in various currencies (primarily the U.S. dollar)","page_number":84,"box":{"x":102,"y":680,"width":798,"height":11}},{"id":"5168feab-7118-4854-8c15-298a9af9e43c","block_type":"box","text":"and are actively traded in the OTC secondary market. Brady Bonds are not considered to be U.S. Government","page_number":84,"box":{"x":69,"y":695,"width":780,"height":11}},{"id":"d5528f71-133d-4a41-86a8-c312f35858b2","block_type":"box","text":"Securities. U.S. dollar-denominated, collateralized Brady Bonds, which may be fixed rate par bonds or floating rate","page_number":84,"box":{"x":69,"y":710,"width":812,"height":11}},{"id":"2476241d-8793-4caf-81b2-eb6155269b6e","block_type":"box","text":"discount bonds, are generally collateralized in full as to principal by U.S. Treasury zero-coupon bonds having the","page_number":84,"box":{"x":69,"y":725,"width":796,"height":11}},{"id":"8e7c81c0-238e-403b-b544-394afd37f856","block_type":"box","text":"same maturity as the Brady Bonds. Interest payments on these Brady Bonds generally are collateralized on a one","page_number":84,"box":{"x":69,"y":740,"width":812,"height":11}},{"id":"f995b363-960d-4ff6-a8d1-6afdedcc74b3","block_type":"box","text":"year or longer rolling-forward basis by cash or securities in an amount that, in the case of fixed rate bonds, is equal","page_number":84,"box":{"x":68,"y":755,"width":823,"height":11}},{"id":"b7a6d983-302c-4192-9024-bc4e5d44e068","block_type":"box","text":"to at least one year of interest payments or, in the case of floating rate bonds, initially is equal to at least one year’s","page_number":84,"box":{"x":68,"y":770,"width":833,"height":12}},{"id":"5810bfe4-70d4-40a1-9597-4a5a943ce0d1","block_type":"box","text":"interest payments based on the applicable interest rate at that time and is adjusted at regular intervals thereafter.","page_number":84,"box":{"x":70,"y":785,"width":816,"height":12}},{"id":"a042e020-a359-4c4a-b00f-d6712900e019","block_type":"box","text":"Cer tain Brady Bonds are entitled to “value recovery payments” in cer tain circumstances, which in effect constitute","page_number":84,"box":{"x":69,"y":801,"width":818,"height":11}},{"id":"3767bf72-b54a-4aac-b2b7-b4f8148f2248","block_type":"box","text":"supplemental interest payments but generally are not collateralized. Brady Bonds are often viewed as having three or","page_number":84,"box":{"x":69,"y":816,"width":835,"height":11}},{"id":"4d11894e-6e51-4798-9483-f409715bcadb","block_type":"box","text":"four valuation components: (i) the collateralized repayment of principal at final maturity; (ii) the collateralized interest","page_number":84,"box":{"x":68,"y":831,"width":832,"height":11}},{"id":"a673c499-b8cf-4cca-b4bc-aac25a32bdc6","block_type":"box","text":"payments; (iii) the uncollateralized interest payments; and (iv) any uncollateralized repayment of principal at maturity","page_number":84,"box":{"x":70,"y":846,"width":828,"height":11}},{"id":"873a13cb-9a60-482f-bf27-61d783a7930c","block_type":"box","text":"(the uncollateralized amounts constitute the “residual risk”).","page_number":84,"box":{"x":69,"y":861,"width":430,"height":11}},{"id":"f9b54aca-5fc6-4757-b553-5de092570f51","block_type":"box","text":"Brady Bonds involve various risk factors described above associated with investing in foreign securities, including","page_number":84,"box":{"x":102,"y":884,"width":807,"height":11}},{"id":"06941bce-7925-4149-b9e9-1e2544f2a578","block_type":"box","text":"the history of defaults with respect to commercial bank loans by public and private entities of countries issuing Brady","page_number":84,"box":{"x":68,"y":899,"width":838,"height":11}},{"id":"238fd088-178c-467d-b1da-1c95d9554e27","block_type":"box","text":"II-40","page_number":84,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"9c6fad7e-f7e0-4c38-a770-787e2d15bd3f","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":84,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"e9ead362-6c82-487d-b6a9-2d3ce86ed0b3","block_type":"box","text":"Bonds. In light of the residual risk of Brady Bonds and, among other factors, the history of defaults, investments in","page_number":85,"box":{"x":70,"y":45,"width":819,"height":11}},{"id":"7329b983-48a3-4568-a0b1-e097ae28d86e","block_type":"box","text":"Brady Bonds are considered speculative. There can be no assurance that Brady Bonds in which the Funds may invest","page_number":85,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"2cbe0d00-5518-4bd7-820c-3d787d6cad7a","block_type":"box","text":"will not be subject to restructuring arrangements or to requests for new credit, which may cause the Funds to suffer a","page_number":85,"box":{"x":68,"y":75,"width":841,"height":11}},{"id":"bd5ae632-0741-4ed5-bd51-94ad8b875d7b","block_type":"box","text":"loss of interest or principal on any of its holdings.","page_number":85,"box":{"x":70,"y":90,"width":351,"height":11}},{"id":"5a1a0b02-eb84-4a40-962a-88bee5742d32","block_type":"box","text":"China Investments Risk.","page_number":85,"box":{"x":102,"y":113,"width":171,"height":9}},{"id":"c488a41c-df9c-47ad-b3f6-5b9f7f8c9b35","block_type":"box","text":"Investments in securities of companies domiciled in the People’s Republic of China (“China” or the “PRC”),","page_number":85,"box":{"x":102,"y":135,"width":763,"height":11}},{"id":"df94b2f8-a4bc-4dc1-8e4f-a7d42894163d","block_type":"box","text":"including cer tain Hong Kong-listed and U.S.-listed securities, involve a high degree of risk and special considerations","page_number":85,"box":{"x":70,"y":150,"width":830,"height":12}},{"id":"433ede5c-4ae7-4e0e-9e57-baa0b7b65195","block_type":"box","text":"not typically associated with investing in the U.S. securities markets. Such heightened risks include, among others,","page_number":85,"box":{"x":69,"y":166,"width":821,"height":11}},{"id":"283936c0-9227-4d5e-8653-e6ec6cc7f1e6","block_type":"box","text":"an authoritarian government, popular unrest associated with demands for improved political, economic and social","page_number":85,"box":{"x":69,"y":181,"width":809,"height":11}},{"id":"35e48cae-2594-4d19-8c42-6be473eccb23","block_type":"box","text":"conditions, the impact of regional conflict on the economy and hostile relations with other countries.","page_number":85,"box":{"x":69,"y":196,"width":713,"height":11}},{"id":"027f0908-b662-4528-a71b-7141cdad745b","block_type":"box","text":"Military conflicts, either in response to internal social unrest or conflicts with other countries, could disrupt","page_number":85,"box":{"x":102,"y":218,"width":762,"height":12}},{"id":"8c246cee-e379-4f56-b10c-f2ec2d9bd5f0","block_type":"box","text":"economic development. The Chinese economy is vulnerable to the long-running disagreements and religious and","page_number":85,"box":{"x":69,"y":234,"width":800,"height":11}},{"id":"1eecbae1-c381-41e2-b169-c6cec5ceb703","block_type":"box","text":"nationalist disputes with Tibet and the Xinjiang region. Since 1997, there have been tensions between the Chinese","page_number":85,"box":{"x":69,"y":249,"width":820,"height":11}},{"id":"95d7468f-c307-4e61-92e1-785ad30edbad","block_type":"box","text":"government and many people in Hong Kong who perceive China as tightening control over Hong Kong’s semi","page_number":85,"box":{"x":68,"y":264,"width":777,"height":11}},{"id":"a64fce5d-deb8-4425-b2bc-bfd6f5e0717c","block_type":"box","text":"autonomous liberal political, economic, legal, and social framework. Protests and unrest have increased tensions","page_number":85,"box":{"x":69,"y":279,"width":809,"height":11}},{"id":"14fbad11-84fe-4d8e-9f34-5a064b7ac9cc","block_type":"box","text":"even fur ther. Due to the interconnected nature of the Hong Kong and Chinese economies, this instability in Hong","page_number":85,"box":{"x":69,"y":294,"width":805,"height":11}},{"id":"75f96563-de3a-4d7d-a5a5-43f9dadc0d41","block_type":"box","text":"Kong may cause uncer tainty in the Hong Kong and Chinese markets. China has a complex territorial dispute","page_number":85,"box":{"x":70,"y":309,"width":770,"height":11}},{"id":"856861e1-c9b7-48b5-abdb-a6fec39d6072","block_type":"box","text":"regarding the sovereignty of Taiwan and has made threats of invasion. Taiwan-based companies and individuals are","page_number":85,"box":{"x":69,"y":324,"width":821,"height":12}},{"id":"5a841436-7de8-47de-9521-0fd7f1a0a685","block_type":"box","text":"significant investors in China. The continuing hostility between China and Taiwan may have an adverse impact on the","page_number":85,"box":{"x":69,"y":339,"width":831,"height":12}},{"id":"0ccce175-8ec1-4d9c-9cb4-4504ee6671ff","block_type":"box","text":"value of the Fund’s investments in China or Taiwan, may cause a suspension in a Fund’s ability to trade in cer tain","page_number":85,"box":{"x":68,"y":355,"width":812,"height":11}},{"id":"b2b30884-9faa-4d13-9987-4b77ac27e1dd","block_type":"box","text":"securities or other assets or may otherwise make such investments impracticable or impossible. Any escalation of","page_number":85,"box":{"x":69,"y":370,"width":818,"height":11}},{"id":"d60ae9fb-77bd-4731-98fb-61f5c59f4d3f","block_type":"box","text":"hostility between China and Taiwan would likely have a significant adverse impact on the value of the Fund’s","page_number":85,"box":{"x":69,"y":385,"width":769,"height":11}},{"id":"e99fc4c1-1f75-4e36-a289-9e8b12a672c1","block_type":"box","text":"investments in both countries and the region. In addition, China has strained international relations with Japan, India,","page_number":85,"box":{"x":70,"y":400,"width":836,"height":11}},{"id":"147b8a08-ce3e-42a6-b3b6-cf33ef891f6b","block_type":"box","text":"the Philippines and other neighbors due to territorial disputes, historical animosities and other defense concerns.","page_number":85,"box":{"x":68,"y":415,"width":810,"height":11}},{"id":"71b4f832-24b1-4a0b-96f9-93bee057cff7","block_type":"box","text":"Frictions between China and the Philippines in the South China Sea pose a risk of escalation potentially leading to","page_number":85,"box":{"x":70,"y":430,"width":813,"height":11}},{"id":"b5b0eb28-9639-4e15-be3a-90084d7349fb","block_type":"box","text":"military conflict. Additionally, China is alleged to have par ticipated in state-sponsored cyberattacks against foreign","page_number":85,"box":{"x":69,"y":445,"width":811,"height":12}},{"id":"c6a99e0f-8487-46d6-b9b4-a3e18db11ad7","block_type":"box","text":"companies and foreign governments. Actual and threatened responses to such activity and strained international","page_number":85,"box":{"x":69,"y":460,"width":804,"height":12}},{"id":"05774d8a-7522-4c72-97f6-a23805e1c4cc","block_type":"box","text":"relations, including purchasing restrictions, sanctions, tariffs or cyberattacks on the Chinese government or Chinese","page_number":85,"box":{"x":69,"y":475,"width":829,"height":12}},{"id":"73b26b7f-ad0e-43d6-ae76-81e8a15254ed","block_type":"box","text":"companies, may impact China’s economy and Chinese issuers of securities in which a Fund invests. China could be","page_number":85,"box":{"x":69,"y":491,"width":825,"height":11}},{"id":"87702d41-c395-4d90-8b11-5f2611f4c025","block_type":"box","text":"affected by military events on the Korean peninsula or internal instability within Nor th Korea. These situations may","page_number":85,"box":{"x":69,"y":506,"width":819,"height":11}},{"id":"eb00d217-d8d6-496c-be5a-45ec0aa11ab1","block_type":"box","text":"cause uncer tainty in the Chinese market and may adversely affect the per formance of the Chinese economy.","page_number":85,"box":{"x":69,"y":521,"width":776,"height":11}},{"id":"ab6453fa-ca74-47d0-b779-3b8544d1441a","block_type":"box","text":"The Chinese government has implemented economic reforms in order to liberalize trade policy, promote foreign","page_number":85,"box":{"x":101,"y":543,"width":792,"height":12}},{"id":"8ba02e83-85bf-4f25-8c84-4daa5f0702c7","block_type":"box","text":"investment in the economy, reduce government control of the economy and develop market mechanisms. However,","page_number":85,"box":{"x":70,"y":559,"width":818,"height":11}},{"id":"2fcbca10-cab4-4142-8caf-f097711b3e53","block_type":"box","text":"the Chinese government still exercises substantial influence over many aspects of the private sector and may own or","page_number":85,"box":{"x":68,"y":574,"width":835,"height":11}},{"id":"12a2afb5-21e7-4068-ba62-8fca4e0c8034","block_type":"box","text":"control many companies. Chinese companies, such as those in the financial services or technology sectors, and","page_number":85,"box":{"x":69,"y":589,"width":802,"height":11}},{"id":"5c4d561d-20e7-4d2f-8d9f-8827e1a2a992","block_type":"box","text":"potentially other sectors in the future, are subject to the risk that Chinese authorities can intervene in their","page_number":85,"box":{"x":70,"y":604,"width":763,"height":11}},{"id":"71426f3a-0ec2-4574-8e74-b45e15765458","block_type":"box","text":"operations and structure. The Chinese government continues to maintain a major role in economic policymaking and","page_number":85,"box":{"x":69,"y":619,"width":829,"height":11}},{"id":"4120a9c1-d681-4e42-9e38-76ba848feeaf","block_type":"box","text":"investing in China involves risk of loss due to expropriation, nationalization, confiscation of assets and proper ty or","page_number":85,"box":{"x":70,"y":634,"width":813,"height":12}},{"id":"98267ee0-fffc-425b-b4fd-261e2d02b2a0","block_type":"box","text":"the imposition of restrictions on foreign investments and on repatriation of capital invested.","page_number":85,"box":{"x":68,"y":649,"width":653,"height":12}},{"id":"adefafd9-6359-4d85-82f3-519e38ef111d","block_type":"box","text":"The Chinese government may intervene in the Chinese financial markets, such as by the imposition of trading","page_number":85,"box":{"x":101,"y":672,"width":783,"height":11}},{"id":"3256a8a5-0782-4062-8dad-3bf0fc408b94","block_type":"box","text":"restrictions, a ban on “naked” shor t selling or the suspension of shor t selling for cer tain stocks. This may affect","page_number":85,"box":{"x":69,"y":687,"width":805,"height":11}},{"id":"68f32a0f-7762-4e67-adfd-eadc4b61b176","block_type":"box","text":"market price and liquidity of these stocks, and may have an unpredictable impact on the investment activities of the","page_number":85,"box":{"x":69,"y":702,"width":827,"height":11}},{"id":"a9096cc7-1fbb-4d26-a469-be46d9758f1d","block_type":"box","text":"Funds. Fur thermore, such market interventions may have a negative impact on market sentiment which may in turn","page_number":85,"box":{"x":70,"y":718,"width":821,"height":11}},{"id":"529ed05a-b481-4c4b-8fa7-4f022cffbc2e","block_type":"box","text":"affect the per formance of the securities markets and as a result the per formance of the Funds.","page_number":85,"box":{"x":69,"y":732,"width":683,"height":11}},{"id":"8c2eb664-2738-4429-8f19-ae285187fad0","block_type":"box","text":"In addition, there is less regulation and monitoring of Chinese securities markets and the activities of investors,","page_number":85,"box":{"x":102,"y":755,"width":797,"height":11}},{"id":"d3fd04ed-d48a-4cab-bb35-175c3555cacd","block_type":"box","text":"brokers and other par ticipants than in the United States. Accordingly, issuers of securities in China, including","page_number":85,"box":{"x":69,"y":770,"width":779,"height":12}},{"id":"acc27cc7-c5cf-4746-a19f-ef8e564a88ca","block_type":"box","text":"Chinese companies that are listed on U.S. exchanges, are not subject to the same degree of regulation as are U.S.","page_number":85,"box":{"x":69,"y":785,"width":822,"height":12}},{"id":"063310fc-3466-498a-aa5f-f8ca218f0dcd","block_type":"box","text":"issuers with respect to such matters as insider trading rules, tender offer regulation, accounting standards or auditor","page_number":85,"box":{"x":70,"y":801,"width":836,"height":11}},{"id":"8e7fe7bf-5af7-439c-8830-bc9ac8e01d8d","block_type":"box","text":"oversight, stockholder proxy requirements and the requirements mandating timely and accurate disclosure of","page_number":85,"box":{"x":69,"y":816,"width":778,"height":11}},{"id":"bb0eeb83-c3e3-4194-b919-fa5f15d450f7","block_type":"box","text":"information. Securities markets in China are in the process of change and fur ther development. This may lead to","page_number":85,"box":{"x":70,"y":831,"width":803,"height":11}},{"id":"2f8a4010-e4e0-4e3f-8aee-34557098e0b0","block_type":"box","text":"trading volatility, difficulty in the settlement and recording of transactions and difficulty in interpreting and applying","page_number":85,"box":{"x":68,"y":846,"width":816,"height":11}},{"id":"ddfc1e6a-03a9-4c6d-b686-2e5fcefc1f4d","block_type":"box","text":"the relevant regulation. Custodians may not be able to offer the level of service and safe-keeping in relation to the","page_number":85,"box":{"x":68,"y":861,"width":816,"height":11}},{"id":"54567921-f916-4772-8dbb-d3456c9c584d","block_type":"box","text":"settlement and administration of securities in China that is customary in more developed markets. In par ticular,","page_number":85,"box":{"x":69,"y":876,"width":798,"height":11}},{"id":"ca20c001-8d73-4c0a-a479-8460db4892c6","block_type":"box","text":"there is a risk that a Fund may not be recognized as the owner of securities that are held on behalf of the Fund by a","page_number":85,"box":{"x":68,"y":891,"width":826,"height":12}},{"id":"0dc226a9-1b12-43e7-8550-8f3e1f4ea8de","block_type":"box","text":"sub-custodian.","page_number":85,"box":{"x":69,"y":907,"width":102,"height":8}},{"id":"0afda47f-2a74-4a4f-b7c3-504dedf15f90","block_type":"box","text":"II-41","page_number":85,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"1e7eb057-89c5-4db7-b8af-7ebf10ce7ecb","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":85,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"701ac4d7-61ba-41c9-8d90-076025cf0b7d","block_type":"box","text":"There may be significant obstacles to obtaining information necessary for investigations into or litigation against","page_number":86,"box":{"x":101,"y":45,"width":801,"height":11}},{"id":"29784d43-6fce-4dfd-a4ae-9e25f616b4d7","block_type":"box","text":"Chinese companies, and shareholders may have limited legal remedies. The Funds do not select investments based","page_number":86,"box":{"x":69,"y":60,"width":829,"height":11}},{"id":"25d85109-561c-4b3c-9e5d-1c2702685218","block_type":"box","text":"on investor protection considerations.","page_number":86,"box":{"x":69,"y":75,"width":268,"height":11}},{"id":"8feb3daf-100b-4a31-8c0f-cafde9802009","block_type":"box","text":"The Chinese government historically took positions that prevented the U.S. Public Company Accounting Oversight","page_number":86,"box":{"x":101,"y":98,"width":806,"height":11}},{"id":"f18bc389-10f4-4212-ac6e-a6c177ca1706","block_type":"box","text":"Board (“PCAOB”) from inspecting the audit work and practices of accounting firms in mainland China and Hong Kong","page_number":86,"box":{"x":70,"y":113,"width":829,"height":11}},{"id":"f620ed4a-3486-4c9e-b22a-09e31acca849","block_type":"box","text":"for compliance with U.S. law and professional standards. On August 26, 2022, the PCAOB signed a Statement of","page_number":86,"box":{"x":68,"y":128,"width":810,"height":11}},{"id":"abb336ec-fc1e-4ec3-b030-46bdceb97fa4","block_type":"box","text":"Protocol with the China Securities Regulatory Commission and the Ministry of Finance of the PRC, which marked the","page_number":86,"box":{"x":69,"y":143,"width":829,"height":11}},{"id":"af41aec2-aa52-40e3-ad1b-62a600add3e2","block_type":"box","text":"first step toward opening access for the PCAOB to inspect and investigate registered public accounting firms","page_number":86,"box":{"x":68,"y":158,"width":774,"height":11}},{"id":"af33414b-932b-42ff-a8d7-35776c032f0f","block_type":"box","text":"headquar tered in mainland China and Hong Kong completely in accordance with U.S. law. However, as this","page_number":86,"box":{"x":69,"y":173,"width":760,"height":11}},{"id":"67e56d8b-089d-4aa2-a0d0-24cddea8878f","block_type":"box","text":"development is relatively recent, the implementation of the Statement of Protocol remains to be tested. Audits","page_number":86,"box":{"x":69,"y":188,"width":788,"height":11}},{"id":"59487dff-807e-4aae-9bc1-992e1cc5071a","block_type":"box","text":"per formed by PCAOB-registered accounting firms in mainland China and Hong Kong may be less reliable than those","page_number":86,"box":{"x":70,"y":203,"width":822,"height":12}},{"id":"a23f28fe-8756-4a53-9cd8-2181e567ec01","block_type":"box","text":"per formed by firms subject to PCAOB inspection. Accordingly, information about the Chinese securities in which the","page_number":86,"box":{"x":70,"y":218,"width":821,"height":12}},{"id":"e91dccc6-10a9-4273-96bc-d3044d913063","block_type":"box","text":"Funds invest may be less reliable or complete. Under amendments to the Sarbanes-Oxley Act enacted in December","page_number":86,"box":{"x":70,"y":234,"width":820,"height":11}},{"id":"32dda69d-8870-42b5-b5d6-2674033466fb","block_type":"box","text":"2020, which requires that the PCAOB be permitted to inspect the accounting firm of a U.S.-listed Chinese issuer,","page_number":86,"box":{"x":69,"y":249,"width":805,"height":11}},{"id":"a871005e-e716-4723-ad47-54b6c290f8bb","block_type":"box","text":"Chinese companies with securities listed on U.S. exchanges may be delisted if the PCAOB is unable to inspect the","page_number":86,"box":{"x":69,"y":264,"width":816,"height":11}},{"id":"961b6d3e-0e01-45c8-bdbd-f7e6dbaeb9a0","block_type":"box","text":"accounting firm.","page_number":86,"box":{"x":69,"y":279,"width":112,"height":11}},{"id":"39ab3688-f6a6-4a02-babf-59e6fee6b5a6","block_type":"box","text":"The Renminbi (“RMB”) is currently not a freely conver tible currency and is subject to foreign exchange control","page_number":86,"box":{"x":101,"y":302,"width":780,"height":11}},{"id":"9b932b38-c4e1-4080-a84e-904d54f5f8bb","block_type":"box","text":"policies and repatriation restrictions imposed by the Chinese government. The imposition of currency controls may","page_number":86,"box":{"x":70,"y":317,"width":815,"height":11}},{"id":"4c232d81-f069-4cfc-b21d-62c8f49de8f4","block_type":"box","text":"negatively impact per formance and liquidity of the Funds as capital may become trapped in the PRC. The Funds could","page_number":86,"box":{"x":69,"y":332,"width":837,"height":11}},{"id":"9045d0a4-e631-4a25-8f5f-d2ff7d76f6d5","block_type":"box","text":"be adversely affected by delays in, or a refusal to grant, any required governmental approval for repatriation of","page_number":86,"box":{"x":69,"y":347,"width":787,"height":11}},{"id":"6683f701-d8ec-46e8-84cf-1daf83697af6","block_type":"box","text":"capital, as well as by the application to the Funds of any restrictions on investments. Investing in entities either in, or","page_number":86,"box":{"x":69,"y":362,"width":837,"height":11}},{"id":"977e3322-4638-4e41-b55f-0226a90b1e66","block_type":"box","text":"which have a substantial por tion of their operations in, the PRC may require the Funds to adopt special procedures,","page_number":86,"box":{"x":68,"y":377,"width":825,"height":11}},{"id":"c959b591-d117-4b6f-9505-cd43dd55b1d0","block_type":"box","text":"seek local government approvals or take other actions, each of which may involve additional costs and delays to the","page_number":86,"box":{"x":69,"y":392,"width":828,"height":12}},{"id":"13308b2d-b69c-43e8-a64a-5eb911471c7a","block_type":"box","text":"Funds. The Fund may also incur costs in connection with conversions between U.S. dollars and RMB, as well as in","page_number":86,"box":{"x":70,"y":408,"width":812,"height":11}},{"id":"73a0aaab-2525-4ead-bde8-d019fa42458d","block_type":"box","text":"connection with conversions between the two separate types of RMB, the onshore RMB (“CNY”) and the offshore","page_number":86,"box":{"x":69,"y":423,"width":808,"height":11}},{"id":"a40197c3-57b2-4916-a39f-d6decd436f2e","block_type":"box","text":"RMB (“CNH”).","page_number":86,"box":{"x":70,"y":438,"width":97,"height":11}},{"id":"8f1e7382-8fa1-439c-aa2d-06d0ad88f793","block_type":"box","text":"Many Chinese companies listed on U.S. exchanges use variable interest entities or “VIEs” in their structure as a","page_number":86,"box":{"x":102,"y":460,"width":802,"height":12}},{"id":"45c7b419-76d5-4636-847d-7c4c4c20d956","block_type":"box","text":"result of foreign ownership restrictions. In a VIE structure, a Chinese operating company establishes a shell company","page_number":86,"box":{"x":69,"y":475,"width":837,"height":12}},{"id":"6f718b4c-d30c-4f80-b868-47a1b31fbf3f","block_type":"box","text":"in another jurisdiction to issue stock to public shareholders. When a VIE structure is used by a Chinese company to","page_number":86,"box":{"x":70,"y":491,"width":822,"height":11}},{"id":"ea152344-0a88-4671-a78c-dccdfe505712","block_type":"box","text":"list its stock in the U.S., instead of owning the equity securities of the Chinese company, the U.S.-listed shell","page_number":86,"box":{"x":70,"y":506,"width":775,"height":11}},{"id":"f913bdcd-542f-48db-9fa9-7796ba68e916","block_type":"box","text":"company directly or indirectly enters into contracts with the Chinese operating company under Chinese law. These","page_number":86,"box":{"x":69,"y":521,"width":809,"height":11}},{"id":"7e55f942-4942-4b51-b05d-2f50227eeb67","block_type":"box","text":"contracts provide the U.S.-listed shell company with only economic exposure to the Chinese company and do not","page_number":86,"box":{"x":69,"y":536,"width":803,"height":11}},{"id":"5107b6f2-5162-461d-ad48-8e2a687b0ad2","block_type":"box","text":"represent equity ownership in the operating company.","page_number":86,"box":{"x":69,"y":551,"width":380,"height":11}},{"id":"ca4b03e2-8820-4766-bdcd-a9f4fa2f875a","block_type":"box","text":"While VIEs are a longstanding practice that is well known to Chinese officials and regulators, they have not been","page_number":86,"box":{"x":101,"y":574,"width":801,"height":11}},{"id":"bed82a50-bc54-485c-a52c-285e4fbfe3c6","block_type":"box","text":"formally recognized under Chinese law. The Chinese government has provided guidance to and placed restrictions on","page_number":86,"box":{"x":68,"y":589,"width":833,"height":11}},{"id":"942b80cb-e808-481b-8819-1058213e8386","block_type":"box","text":"Chinese-based companies raising capital offshore, including through VIEs. In 2023, the China Securities Regulatory","page_number":86,"box":{"x":69,"y":604,"width":825,"height":11}},{"id":"8e27ad61-766e-46f1-85ac-2f8128f581d0","block_type":"box","text":"Commission (“CSRC”) released new rules that permit the use of VIE structures, provided they abide by Chinese laws","page_number":86,"box":{"x":69,"y":619,"width":832,"height":11}},{"id":"6d334503-7c2e-4b60-bfc9-2a3b0b42299c","block_type":"box","text":"and register with the CSRC. The rules, however, may cause Chinese companies to undergo greater scrutiny and add","page_number":86,"box":{"x":69,"y":634,"width":826,"height":12}},{"id":"65e3c6fa-7775-4d3c-99a9-65d55adfff7e","block_type":"box","text":"costs to VIE structures. Intervention, rulemaking or guidance by the Chinese government with respect to VIE","page_number":86,"box":{"x":69,"y":649,"width":770,"height":12}},{"id":"640eb161-c81f-41f9-be22-536bfae3faf1","block_type":"box","text":"structures or the non-enforcement of VIE-related contractual rights could significantly affect the operating company’s","page_number":86,"box":{"x":69,"y":664,"width":829,"height":12}},{"id":"b7c6afe2-ac4e-40be-91ee-0f83e6994976","block_type":"box","text":"business in China, the enforceability of the U.S.-listed shell company’s contractual arrangements with the Chinese","page_number":86,"box":{"x":69,"y":680,"width":815,"height":11}},{"id":"75b92f35-d6a9-4afc-b685-f8b75c5be3fb","block_type":"box","text":"company and the value of the U.S.-listed stock. Fur ther, the VIE contractual arrangement would likely be subject to","page_number":86,"box":{"x":69,"y":695,"width":815,"height":11}},{"id":"b3bc26cd-4088-4c61-bb7f-575f89d13102","block_type":"box","text":"Chinese law and jurisdiction, and remedies available to the U.S.-listed shell company are uncer tain and could be","page_number":86,"box":{"x":69,"y":710,"width":802,"height":11}},{"id":"e08a3ccb-359f-46d7-a19b-a62249d6f0a1","block_type":"box","text":"ineffective. In addition to the risk of government intervention, investments through a VIE structure are subject to the","page_number":86,"box":{"x":70,"y":725,"width":828,"height":11}},{"id":"48ff64f2-11bf-4476-a175-f37b7a968177","block_type":"box","text":"risk that the China-based company (or its officers, directors, or Chinese equity owners) may breach those contractual","page_number":86,"box":{"x":69,"y":740,"width":833,"height":11}},{"id":"339ed611-e9d2-46f4-9c3c-365db78eac8d","block_type":"box","text":"arrangements, or Chinese law changes in a way that adversely affects the enforceability of these arrangements, or","page_number":86,"box":{"x":69,"y":755,"width":819,"height":11}},{"id":"914a58fc-3c5e-4ec1-9eb0-8c22962d479e","block_type":"box","text":"those contracts are otherwise not enforceable under Chinese law, in which case the Fund may suffer significant","page_number":86,"box":{"x":68,"y":770,"width":798,"height":12}},{"id":"41724336-44bc-456f-a96c-332cd9a22e3e","block_type":"box","text":"losses on its investments through a VIE structure with little or no recourse available. Any change in the operations of","page_number":86,"box":{"x":70,"y":785,"width":833,"height":12}},{"id":"f0e89f47-4a38-4b96-a4e1-643ee4ed0121","block_type":"box","text":"entities in a VIE structure, the status of VIE contractual arrangements or the legal or regulatory environment in China,","page_number":86,"box":{"x":69,"y":801,"width":837,"height":11}},{"id":"b4144ba6-ad57-414a-8b60-2aef15f6cec3","block_type":"box","text":"generally or with respect to specific industries, could result in significant, and possibly permanent and/or total,","page_number":86,"box":{"x":68,"y":816,"width":792,"height":11}},{"id":"4498d1ea-2c5c-465b-8968-f6dbe69866af","block_type":"box","text":"losses to a Fund.","page_number":86,"box":{"x":70,"y":831,"width":120,"height":9}},{"id":"581e86b7-4b7a-4c62-8769-855de0ef126f","block_type":"box","text":"While the Chinese economy has experienced past periods of rapid growth, there is no assurance that such","page_number":86,"box":{"x":101,"y":853,"width":760,"height":12}},{"id":"22f1be90-67b0-4b31-866e-d2a4bd688e4e","block_type":"box","text":"growth rates will recur. Other economic challenges for China include indebtedness, weak consumer demand, trade","page_number":86,"box":{"x":68,"y":869,"width":815,"height":11}},{"id":"e6b23d85-92ea-4d7a-8b4d-9bfff591909f","block_type":"box","text":"tensions, and an aging population. China continues to face pressure from its trading par tners over its expor ting of its","page_number":86,"box":{"x":68,"y":884,"width":837,"height":11}},{"id":"025d36be-e84b-47b3-836d-67c5d1f92e2e","block_type":"box","text":"excess industrial capacity and overall approach to economic management. China’s economy is heavily dependent on","page_number":86,"box":{"x":69,"y":899,"width":830,"height":11}},{"id":"b71aec9b-4298-4209-9082-df0e34ae9f0b","block_type":"box","text":"II-42","page_number":86,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"06cfa34c-ddc8-482c-acf3-f1589ecba78a","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":86,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"e24c0a20-a0af-4d9e-821d-0e750e500b51","block_type":"box","text":"expor t growth. Reduction in spending on Chinese products and services, supply chain diversification, institution of","page_number":87,"box":{"x":69,"y":45,"width":815,"height":11}},{"id":"727fdea2-1d87-43a6-b702-331534e88220","block_type":"box","text":"additional tariffs, sanctions or other trade barriers (including as a result of heightened trade tensions between China","page_number":87,"box":{"x":69,"y":60,"width":832,"height":11}},{"id":"881161af-5718-4564-8198-311340ccb69f","block_type":"box","text":"and the United States or in response to actual or alleged Chinese cyber activity) or a downturn in any of the","page_number":87,"box":{"x":69,"y":75,"width":765,"height":11}},{"id":"87b384da-ca37-4a6b-b7ba-6507228ec0e2","block_type":"box","text":"economies of China’s key trading par tners may have an adverse impact on the Chinese economy and the companies","page_number":87,"box":{"x":69,"y":90,"width":833,"height":11}},{"id":"c583cd19-2734-47be-a66a-e8c61856d096","block_type":"box","text":"in which a Fund invests. Cer tain Chinese companies (which may change from time to time) are directly or indirectly","page_number":87,"box":{"x":70,"y":105,"width":816,"height":11}},{"id":"572fc25b-3eb0-4163-b5b1-862f3a8a81d5","block_type":"box","text":"subject to economic or trade restrictions imposed by the U.S. or other governments due to national security, human","page_number":87,"box":{"x":69,"y":120,"width":824,"height":12}},{"id":"ad454580-2f83-4f09-81e4-b0a5f2a82434","block_type":"box","text":"rights or other concerns of such government. For example, cer tain foreign technology companies are subject to U.S.","page_number":87,"box":{"x":69,"y":135,"width":825,"height":12}},{"id":"ce00632c-7402-4eca-9225-330387669ab8","block_type":"box","text":"expor t controls as those companies are believed to pose a risk to U.S. interests. The U.S. also bans impor ts of","page_number":87,"box":{"x":69,"y":150,"width":798,"height":11}},{"id":"90d8597c-ba84-4968-91a5-75d10a030091","block_type":"box","text":"goods produced in cer tain regions of China or by cer tain Chinese companies due to concerns about forced labor.","page_number":87,"box":{"x":68,"y":166,"width":805,"height":11}},{"id":"f1fc2d11-6d04-4bfd-8737-84143621bf89","block_type":"box","text":"Such restrictions may have unanticipated and adverse effects on the Chinese economy and companies. Any action","page_number":87,"box":{"x":69,"y":181,"width":817,"height":11}},{"id":"ce168a27-3168-4e8b-ba54-0ce632a8aff0","block_type":"box","text":"that targets Chinese financial markets or securities exchanges could inter fere with orderly trading, delay settlement","page_number":87,"box":{"x":68,"y":196,"width":825,"height":11}},{"id":"0f94f0a7-a5ab-4c08-9a29-bb5a19082d77","block_type":"box","text":"or cause market disruptions. Cer tain companies may be subject to economic or trade restrictions (but not investment","page_number":87,"box":{"x":69,"y":211,"width":839,"height":11}},{"id":"5722d217-6d6f-4b44-9cd6-8743030df907","block_type":"box","text":"restrictions) imposed by the U.S. or other governments due to national security, human rights or other concerns of","page_number":87,"box":{"x":69,"y":226,"width":815,"height":11}},{"id":"1f280fbd-01f6-497f-ae2c-2525ac546df2","block_type":"box","text":"such government. So long as these restrictions do not include restrictions on investments, the Fund may invest in","page_number":87,"box":{"x":69,"y":241,"width":812,"height":11}},{"id":"a199f66a-539b-4c18-aeca-599d4ee85c2a","block_type":"box","text":"such companies.","page_number":87,"box":{"x":69,"y":257,"width":119,"height":10}},{"id":"e5b2cf37-4a33-4401-b0e4-14f4c7f921f8","block_type":"box","text":"The tax laws and regulations in the PRC are subject to change, including the issuance of authoritative guidance","page_number":87,"box":{"x":101,"y":279,"width":792,"height":11}},{"id":"3507dd73-ce36-490a-af70-1c8759b4586b","block_type":"box","text":"or enforcement, possibly with retroactive effect. The interpretation, applicability and enforcement of such laws by PRC","page_number":87,"box":{"x":69,"y":294,"width":840,"height":11}},{"id":"0c32d13d-5aad-46d7-81c1-c4558b152c82","block_type":"box","text":"tax authorities are not as consistent and transparent as those of more developed nations, and may vary over time","page_number":87,"box":{"x":68,"y":309,"width":815,"height":11}},{"id":"8742c1d5-bf5f-48b1-bafc-7013a205a2db","block_type":"box","text":"and from region to region. The application and enforcement of PRC tax rules could have a significant adverse effect","page_number":87,"box":{"x":69,"y":324,"width":823,"height":12}},{"id":"adaaa1dc-f2a6-4958-9752-7a20ac265dc9","block_type":"box","text":"on a Fund and its investors, par ticularly in relation to capital gains withholding tax imposed upon non-residents. In","page_number":87,"box":{"x":69,"y":340,"width":812,"height":11}},{"id":"e50b7c79-2bcd-4552-9916-09c976cdb7b7","block_type":"box","text":"addition, the accounting, auditing and financial repor ting standards and practices applicable to Chinese companies","page_number":87,"box":{"x":69,"y":355,"width":821,"height":11}},{"id":"f2f74edd-1b8b-4401-9691-2065da91747e","block_type":"box","text":"may be less rigorous, and may result in significant differences between financial statements prepared in accordance","page_number":87,"box":{"x":69,"y":370,"width":832,"height":11}},{"id":"dda26c47-5318-4feb-be53-cd69e926bc20","block_type":"box","text":"with PRC accounting standards and practice and those prepared in accordance with international accounting","page_number":87,"box":{"x":68,"y":385,"width":773,"height":11}},{"id":"d790ef1a-16f7-4c8c-a427-0a4364202638","block_type":"box","text":"standards.","page_number":87,"box":{"x":69,"y":400,"width":74,"height":9}},{"id":"645d91e9-c4a0-4e4f-8cbf-d0ee86ae5e27","block_type":"box","text":"From time to time and in recent years, China has experienced outbreaks of infectious illnesses and the country","page_number":87,"box":{"x":102,"y":423,"width":794,"height":11}},{"id":"a20b4eb6-fa21-4f15-ab8a-6f0fc6594c5c","block_type":"box","text":"may be subject to other public health threats, infectious illnesses, diseases or similar issues in the future. Any","page_number":87,"box":{"x":69,"y":438,"width":792,"height":11}},{"id":"94f9eb47-368d-4915-96e1-7b436aff8def","block_type":"box","text":"spread of an infectious illness, public health threat or similar issue could reduce consumer demand or economic","page_number":87,"box":{"x":69,"y":453,"width":803,"height":11}},{"id":"37d705fb-80bb-4e5b-97f1-5828b9b737ba","block_type":"box","text":"output, result in market closures, travel restrictions or quarantines, and generally have a significant impact on the","page_number":87,"box":{"x":69,"y":468,"width":811,"height":11}},{"id":"6d9b4088-c72a-447e-b1b6-33063fdd0287","block_type":"box","text":"Chinese economy, which in turn could adversely affect a Fund’s investments.","page_number":87,"box":{"x":69,"y":483,"width":548,"height":11}},{"id":"4e0a2564-149b-40e7-96ca-a8df3bcee414","block_type":"box","text":"Risk of Investing through Stock Connect.","page_number":87,"box":{"x":102,"y":506,"width":288,"height":11}},{"id":"fde76828-d4f4-4bf9-85b3-52878aa928c0","block_type":"box","text":"General","page_number":87,"box":{"x":102,"y":529,"width":55,"height":8}},{"id":"03ae3d7e-e5e9-4fd7-a8e0-434a7ff16954","block_type":"box","text":". China A-shares are equity securities of companies domiciled in China that trade on Chinese stock","page_number":87,"box":{"x":158,"y":528,"width":704,"height":12}},{"id":"eed9e202-0e34-45ab-8d24-83e095a02868","block_type":"box","text":"exchanges such as the Shanghai Stock Exchange (“SSE”), the Shenzhen Stock Exchange (“SZSE”) and the Beijing","page_number":87,"box":{"x":69,"y":544,"width":815,"height":11}},{"id":"50aeb84b-6f9b-487d-b414-2af20472ad50","block_type":"box","text":"Stock Exchange (“BSE”) (“A-shares”). Foreign investment in A-shares on the SSE and SZSE is not permitted, other","page_number":87,"box":{"x":69,"y":559,"width":815,"height":11}},{"id":"89337771-c570-403a-a33e-58b2e35a74ac","block_type":"box","text":"than pursuant to available exceptions, such as through a qualified foreign investor approved pursuant to the relevant","page_number":87,"box":{"x":68,"y":574,"width":833,"height":11}},{"id":"0cd3207b-e94e-4178-beb8-353b8b5e6f9e","block_type":"box","text":"mainland China laws and regulations as may be promulgated and/or amended from time to time (“QFI”).","page_number":87,"box":{"x":69,"y":589,"width":744,"height":11}},{"id":"59137b5c-f8e8-45fe-8d35-18ef21ecd39a","block_type":"box","text":"Investment in eligible exchange traded funds and A-shares listed and traded on the SSE or SZSE (“Stock","page_number":87,"box":{"x":102,"y":612,"width":745,"height":11}},{"id":"2a30a3e9-6f08-45a2-aa0a-4c94641b5071","block_type":"box","text":"Connect Securities”) is also permitted through the Shanghai-Hong Kong Stock Connect program or the Shenzhen","page_number":87,"box":{"x":69,"y":627,"width":807,"height":11}},{"id":"1ab3c9a1-bcbe-4a42-b6ee-805c1cbeb57e","block_type":"box","text":"Hong Kong Stock Connect program, as applicable (each, a “Stock Connect” and collectively, “Stock Connects”). Each","page_number":87,"box":{"x":70,"y":642,"width":834,"height":11}},{"id":"2b1764d8-7e65-425a-ab58-ec6c408bdbf5","block_type":"box","text":"Stock Connect is a securities trading and clearing links program established by The Stock Exchange of Hong Kong","page_number":87,"box":{"x":69,"y":657,"width":812,"height":11}},{"id":"3fb81221-8aec-4384-8388-ab78276bf7b6","block_type":"box","text":"Limited (“SEHK”), the Hong Kong Securities Clearing Company Limited (“HKSCC”), the SSE or SZSE, as applicable,","page_number":87,"box":{"x":70,"y":672,"width":819,"height":11}},{"id":"fa34586d-f189-4ae2-8e1d-660a2a750178","block_type":"box","text":"and China Securities Depository and Clearing Corporation Limited (“CSDCC”) that aims to provide mutual stock","page_number":87,"box":{"x":69,"y":687,"width":793,"height":11}},{"id":"53730d71-a42c-415b-abe4-6e4ff34580c6","block_type":"box","text":"market access between the PRC and Hong Kong by permitting investors to trade and settle shares on each market","page_number":87,"box":{"x":69,"y":702,"width":818,"height":12}},{"id":"935b53ba-b36c-4a69-9cbd-f538a1b66fee","block_type":"box","text":"through their local securities brokers. Under Stock Connects, a Fund’s trading of Stock Connect Securities listed on","page_number":87,"box":{"x":68,"y":717,"width":824,"height":12}},{"id":"df464af2-d9e7-47bc-80be-cad8a4d29784","block_type":"box","text":"the SSE or SZSE, as applicable, would be effectuated through its Hong Kong broker and a securities trading service","page_number":87,"box":{"x":68,"y":732,"width":827,"height":12}},{"id":"189cd5fe-77fb-4c6c-b4a2-c5d117c7f297","block_type":"box","text":"company established by SEHK.","page_number":87,"box":{"x":69,"y":748,"width":219,"height":11}},{"id":"2f5e323e-e010-429e-a34d-22ddbfcac7ff","block_type":"box","text":"Although no individual investment quotas or licensing requirements apply to investors in Stock Connect, trading","page_number":87,"box":{"x":101,"y":770,"width":794,"height":12}},{"id":"0ee0a496-80d9-4a6a-a089-8c7441bcb503","block_type":"box","text":"through a Stock Connect’s Nor thbound Trading Link is subject to daily investment quota limitations which require that","page_number":87,"box":{"x":68,"y":786,"width":839,"height":11}},{"id":"33c10859-d3d5-4274-b2c8-536f2c925f0b","block_type":"box","text":"buy orders for Stock Connect Securities be rejected once the daily quota is exceeded (although a Fund will be","page_number":87,"box":{"x":69,"y":801,"width":779,"height":11}},{"id":"49578066-d958-4c8a-8a5f-dbbcded3de72","block_type":"box","text":"permitted to sell their Stock Connect Securities regardless of the quota). These limitations may restrict a Fund from","page_number":87,"box":{"x":70,"y":816,"width":824,"height":11}},{"id":"d3bedbbd-9c2a-4a4a-af28-a278705c3315","block_type":"box","text":"investing in Stock Connect Securities on a timely basis, which could affect the Fund’s ability to effectively pursue its","page_number":87,"box":{"x":70,"y":831,"width":827,"height":11}},{"id":"8d722ba4-193f-4752-aff4-e31fec304fde","block_type":"box","text":"investment strategy. Investment quotas are also subject to change. Investment in Stock Connect Securities through a","page_number":87,"box":{"x":70,"y":846,"width":837,"height":11}},{"id":"3f694b15-1b9d-4dd7-b141-6d6bc9ff559c","block_type":"box","text":"Stock Connect is subject to trading, clearance and settlement procedures that could pose risks to a Fund. Stock","page_number":87,"box":{"x":69,"y":861,"width":802,"height":11}},{"id":"44d1a893-7395-47d4-983c-bf1fbba2121a","block_type":"box","text":"Connect Securities purchased through Stock Connects generally may not be sold or otherwise transferred other than","page_number":87,"box":{"x":69,"y":876,"width":831,"height":11}},{"id":"7e28c307-8785-4f13-bd19-942f5df619e6","block_type":"box","text":"through Stock Connects in accordance with applicable rules. For example, the PRC regulations require that in order","page_number":87,"box":{"x":68,"y":891,"width":821,"height":12}},{"id":"89f72d0d-0f9f-4029-a60a-c57a0d2d9df8","block_type":"box","text":"for an investor to sell any Stock Connect Securities on a cer tain trading day, there must be sufficient Stock Connect","page_number":87,"box":{"x":68,"y":906,"width":829,"height":12}},{"id":"f1a0a241-50d8-4c33-8f62-5e983c7f9623","block_type":"box","text":"II-43","page_number":87,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"22f3bf3e-3378-4a2c-b74d-77b686f43590","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":87,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"d70d4415-d2cb-422a-b2df-05c6750abe07","block_type":"box","text":"Securities in the investor’s account before the market opens on that day. If there are insufficient Stock Connect","page_number":88,"box":{"x":69,"y":45,"width":797,"height":11}},{"id":"09800cbf-6b0b-419c-95d4-9b6f9625defc","block_type":"box","text":"Securities in the investor’s account, the sell order will be rejected by the SSE or SZSE, as applicable. SEHK carries","page_number":88,"box":{"x":69,"y":60,"width":820,"height":11}},{"id":"52f2b5ce-9adb-41c6-93ef-1a686c32536d","block_type":"box","text":"out pre-trade checking on sell orders of cer tain stocks listed on the SSE market (“SSE Securities”) or SZSE market","page_number":88,"box":{"x":69,"y":75,"width":820,"height":11}},{"id":"b242c723-b908-4f1a-8db5-5d056afce712","block_type":"box","text":"(“SZSE Securities”) of its par ticipants (","page_number":88,"box":{"x":69,"y":90,"width":278,"height":11}},{"id":"680ad183-5f31-4942-938e-cb82b2990cdb","block_type":"box","text":"i.e.","page_number":88,"box":{"x":349,"y":90,"width":21,"height":9}},{"id":"1aa892aa-e808-48b3-9bb6-a007b6ba11aa","block_type":"box","text":", stock brokers) to ensure that this requirement is satisfied. While shares","page_number":88,"box":{"x":372,"y":90,"width":524,"height":11}},{"id":"572246fa-8661-4e2a-9b65-2d7a5eb8a070","block_type":"box","text":"must be designated as eligible to be traded under a Stock Connect, those shares may also lose such designation,","page_number":88,"box":{"x":69,"y":105,"width":815,"height":11}},{"id":"fe3990f9-be63-4122-91d4-815eaac05bdd","block_type":"box","text":"and if this occurs, such shares may be sold but cannot be purchased through a Stock Connect. In addition, Stock","page_number":88,"box":{"x":69,"y":120,"width":810,"height":12}},{"id":"ed635e3b-3c3a-4f30-a42c-d2b2089e84b5","block_type":"box","text":"Connects will only operate on days when both the Chinese and Hong Kong markets are open for trading, and banking","page_number":88,"box":{"x":69,"y":135,"width":834,"height":12}},{"id":"410e867d-ec8e-47ff-8c60-e66130752e3b","block_type":"box","text":"services are available in both markets on the corresponding settlement days. Therefore, an investment in Stock","page_number":88,"box":{"x":69,"y":150,"width":799,"height":12}},{"id":"89098564-a71b-4e1c-a0a0-023262f1d698","block_type":"box","text":"Connect Securities through a Stock Connect may subject a Fund to a risk of price fluctuations on days when the","page_number":88,"box":{"x":69,"y":166,"width":797,"height":11}},{"id":"27ce634a-05a0-4006-98c2-7e3f682724a0","block_type":"box","text":"Chinese market is open, but a Stock Connect is not trading. Moreover, day (turnaround) trading is not permitted on","page_number":88,"box":{"x":69,"y":181,"width":818,"height":11}},{"id":"8a810e58-bb0b-4fe0-884a-47a5bfd03ed9","block_type":"box","text":"the Stock Connect Securities market. If an investor buys Stock Connect Securities on day “T,” the investor will only","page_number":88,"box":{"x":68,"y":196,"width":820,"height":11}},{"id":"3835c383-6321-4dbb-8a63-572b37527b2c","block_type":"box","text":"be able to sell the Stock Connect Securities on or after day T+1. Fur ther, since all trades of Stock Connect Securities","page_number":88,"box":{"x":69,"y":211,"width":836,"height":11}},{"id":"20dcda4e-6156-435c-8536-e0298740ab95","block_type":"box","text":"must be settled in RMB, investors must have timely access to a reliable supply of offshore RMB, which cannot be","page_number":88,"box":{"x":69,"y":226,"width":811,"height":11}},{"id":"058b484f-52e7-4f02-ad6d-6601aecfa2ce","block_type":"box","text":"guaranteed. There is also no assurance that RMB will not be subject to devaluation. Any devaluation of RMB could","page_number":88,"box":{"x":68,"y":241,"width":815,"height":11}},{"id":"23f88c23-ff72-4732-8a0c-fcdf66052cfc","block_type":"box","text":"adversely affect a Fund’s investments. If a Fund holds a class of shares denominated in a local currency other than","page_number":88,"box":{"x":69,"y":256,"width":824,"height":11}},{"id":"afdc9152-c880-4d85-bb04-5da32cf25bdb","block_type":"box","text":"RMB, the Fund will be exposed to currency exchange risk if the Fund conver ts the local currency into RMB for","page_number":88,"box":{"x":70,"y":271,"width":777,"height":12}},{"id":"4e108999-028e-415c-8eb9-db240644a5c3","block_type":"box","text":"investments in Stock Connect Securities. A Fund may also incur conversion costs.","page_number":88,"box":{"x":70,"y":287,"width":582,"height":11}},{"id":"17eec81c-5808-4ac4-89c8-16e5567b68f9","block_type":"box","text":"Stock Connect Securities held through the nominee structure under a Stock Connect will be held through HKSCC","page_number":88,"box":{"x":102,"y":309,"width":802,"height":11}},{"id":"3ece51c8-ec89-466c-a87a-4195d6234527","block_type":"box","text":"as nominee on behalf of investors. The precise nature and rights of a Fund as the beneficial owner of the SSE","page_number":88,"box":{"x":69,"y":324,"width":784,"height":12}},{"id":"4dafb2ea-01f1-458e-aa40-cba44c7883d9","block_type":"box","text":"Securities or SZSE Securities through HKSCC as nominee is not well defined under the PRC laws. There is a lack of a","page_number":88,"box":{"x":69,"y":339,"width":837,"height":12}},{"id":"16c480ac-cf60-473d-8c25-2f9c8d9af63e","block_type":"box","text":"clear definition of, and distinction between, legal ownership and beneficial ownership under the PRC laws and there","page_number":88,"box":{"x":69,"y":355,"width":822,"height":11}},{"id":"fd417904-8373-4e12-ba59-8443fc505a17","block_type":"box","text":"have been few cases involving a nominee account structure in the PRC cour ts. The exact nature and methods of","page_number":88,"box":{"x":69,"y":370,"width":802,"height":11}},{"id":"ac342a3b-f46b-44e6-95e5-9d5d8d1551e8","block_type":"box","text":"enforcement of the rights and interests of a Fund under the PRC laws is also uncer tain. In the unlikely event that","page_number":88,"box":{"x":69,"y":385,"width":805,"height":11}},{"id":"22175fb6-bb32-46c7-9e4c-62a2799694ef","block_type":"box","text":"HKSCC becomes subject to winding up proceedings in Hong Kong, there is a risk that the SSE Securities or SZSE","page_number":88,"box":{"x":70,"y":400,"width":807,"height":11}},{"id":"b847fef2-1503-4abe-a2ae-8fe2ff926152","block_type":"box","text":"Securities may not be regarded as held for the beneficial ownership of a Fund or as par t of the general assets of","page_number":88,"box":{"x":69,"y":415,"width":805,"height":11}},{"id":"591544b1-1dc3-4b26-8805-2c377d3a6473","block_type":"box","text":"HKSCC available for general distribution to its creditors. Notwithstanding the fact that HKSCC does not claim","page_number":88,"box":{"x":70,"y":430,"width":774,"height":11}},{"id":"e51b013d-2f86-4d95-99a2-e845e6c6c03d","block_type":"box","text":"proprietary interests in the SSE Securities or SZSE Securities held in its omnibus stock account in the CSDCC, the","page_number":88,"box":{"x":70,"y":445,"width":816,"height":11}},{"id":"936e8fe2-e4fe-4008-8ca7-66af562b1d16","block_type":"box","text":"CSDCC as the share registrar for SSE- or SZSE-listed companies will still treat HKSCC as one of the shareholders","page_number":88,"box":{"x":69,"y":460,"width":808,"height":12}},{"id":"8f6103c9-2f09-4a91-afd9-efefceb20ae5","block_type":"box","text":"when it handles corporate actions in respect of such SSE Securities or SZSE Securities. HKSCC monitors the","page_number":88,"box":{"x":68,"y":475,"width":779,"height":11}},{"id":"01373505-4b3c-4d31-8065-00994bf841af","block_type":"box","text":"corporate actions affecting SSE Securities and SZSE Securities and keeps par ticipants of Central Clearing and","page_number":88,"box":{"x":69,"y":491,"width":788,"height":11}},{"id":"a1f16366-0f9c-425c-91c0-438d512f8430","block_type":"box","text":"Settlement System (“CCASS”) informed of all such corporate actions that require CCASS par ticipants to take steps in","page_number":88,"box":{"x":69,"y":506,"width":839,"height":11}},{"id":"8962174b-7024-4be3-a092-f7dff2030dab","block_type":"box","text":"order to par ticipate in them. Investors may only exercise their voting rights by providing their voting instructions to","page_number":88,"box":{"x":69,"y":521,"width":811,"height":11}},{"id":"d2722827-747f-4bd8-9267-38ed1eb640d5","block_type":"box","text":"HKSCC through par ticipants of CCASS. All voting instructions from CCASS par ticipants will be consolidated by","page_number":88,"box":{"x":70,"y":536,"width":783,"height":11}},{"id":"c239ee87-e5b4-4f82-9eb4-2af4991cedd3","block_type":"box","text":"HKSCC, who will then submit a combined single voting instruction to the relevant SSE- or SZSE-listed company. As a","page_number":88,"box":{"x":70,"y":551,"width":826,"height":11}},{"id":"28c5ebf0-d764-4678-8bd1-e40e0d0f0aea","block_type":"box","text":"result, a Fund may suffer difficulties or delays in enforcing its rights in SSE Securities or SZSE Securities.","page_number":88,"box":{"x":69,"y":566,"width":752,"height":11}},{"id":"df1cabcf-d563-49bd-a80a-35e6bfcc84f3","block_type":"box","text":"Hong Kong’s Investor Compensation Fund is established to pay compensation to investors of any nationality who","page_number":88,"box":{"x":102,"y":589,"width":804,"height":11}},{"id":"281dc95f-6088-4e53-b941-9e86fe3ea59d","block_type":"box","text":"suffer pecuniary losses as a result of default of a licensed intermediary or authorized financial institution in relation","page_number":88,"box":{"x":69,"y":604,"width":826,"height":11}},{"id":"cb9f57dc-b5c2-4049-adb4-d543a2b92311","block_type":"box","text":"to exchange-traded products in Hong Kong. For defaults occurring on or after January 1, 2020, Hong Kong’s","page_number":88,"box":{"x":68,"y":619,"width":769,"height":11}},{"id":"203912df-9922-493b-aaa0-394ae31575e9","block_type":"box","text":"Investor Compensation Fund covers investors’ losses in relation to securities (i) that are traded on the SSE or the","page_number":88,"box":{"x":70,"y":634,"width":809,"height":11}},{"id":"c13d7ec5-2110-4cc2-af97-4216165fe827","block_type":"box","text":"SZSE and (ii) in respect of which an order for sale or purchase is permitted to be routed through the Nor thbound","page_number":88,"box":{"x":69,"y":649,"width":801,"height":12}},{"id":"e4a42bd7-0ce9-414a-8fa9-c8dd6d5c598b","block_type":"box","text":"Trading Link of a Stock Connect. On the other hand, since a Fund carries out Nor thbound trading through securities","page_number":88,"box":{"x":68,"y":664,"width":822,"height":12}},{"id":"ded61342-f767-482d-b825-5bb40247ee92","block_type":"box","text":"brokers in Hong Kong but not PRC brokers, it is not protected by the China Securities Investor Protection Fund in the","page_number":88,"box":{"x":69,"y":680,"width":829,"height":11}},{"id":"5de14a83-0b95-46ab-b3fb-f51bc8d1bfe1","block_type":"box","text":"PRC.","page_number":88,"box":{"x":69,"y":695,"width":32,"height":9}},{"id":"2ba0488d-d547-4571-975a-c45b9b17ede9","block_type":"box","text":"Market par ticipants are able to par ticipate in Stock Connects subject to meeting cer tain information technology","page_number":88,"box":{"x":102,"y":717,"width":796,"height":12}},{"id":"8f20e9a1-135d-4eca-adbf-755716b6680f","block_type":"box","text":"capability, risk management and other requirements as may be specified by the relevant exchange and/or clearing","page_number":88,"box":{"x":69,"y":732,"width":815,"height":12}},{"id":"815c5d62-717c-42a5-924e-1efeb327b08b","block_type":"box","text":"house. Fur ther, the “connectivity” in Stock Connects requires routing of orders across the border of Hong Kong and","page_number":88,"box":{"x":69,"y":748,"width":822,"height":11}},{"id":"dcd1ed86-732f-4d90-a8f0-b4fe26733636","block_type":"box","text":"the PRC. This requires the development of new information technology systems on the par t of SEHK and exchange","page_number":88,"box":{"x":68,"y":763,"width":818,"height":11}},{"id":"b6ec9386-11bf-4f61-9cd4-5da1f08af1b5","block_type":"box","text":"par ticipants. There is no assurance that the systems of SEHK and market par ticipants will function properly or will","page_number":88,"box":{"x":70,"y":778,"width":813,"height":11}},{"id":"049b8daf-0af5-49ff-9e6c-581c2f32688c","block_type":"box","text":"continue to be adapted to changes and developments in both markets. In the event that the relevant systems fail to","page_number":88,"box":{"x":69,"y":793,"width":827,"height":11}},{"id":"d68d9329-963d-487f-b92c-f409d8491322","block_type":"box","text":"function properly, trading in Stock Connect Securities through Stock Connects could be disrupted.","page_number":88,"box":{"x":68,"y":808,"width":695,"height":11}},{"id":"448a0b7e-29ca-41ac-b964-bd2247f26a46","block_type":"box","text":"The Shanghai-Hong Kong Stock Connect program launched in November 2014 and the Shenzhen-Hong Kong","page_number":88,"box":{"x":101,"y":831,"width":772,"height":11}},{"id":"826214e0-4ec5-4995-bcff-a624f8070589","block_type":"box","text":"Stock Connect program launched in December 2016. Each program does not have an extensive operating history.","page_number":88,"box":{"x":69,"y":846,"width":810,"height":11}},{"id":"46cb38a4-80d3-4984-a2c0-dc6ab4e91685","block_type":"box","text":"New or revised regulations may be issued from time to time by the regulators and stock exchanges in China and","page_number":88,"box":{"x":70,"y":861,"width":798,"height":11}},{"id":"bc6051ec-408e-4bf7-98cf-71536014df14","block_type":"box","text":"Hong Kong in connection with operations, legal enforcement and cross-border trades under Stock Connects. In","page_number":88,"box":{"x":70,"y":876,"width":786,"height":11}},{"id":"13bf3191-fcfd-405e-bb49-e8a1dd17d138","block_type":"box","text":"addition, there can be no assurance that Stock Connect will not be discontinued. A Fund may be adversely affected","page_number":88,"box":{"x":69,"y":891,"width":821,"height":11}},{"id":"f3cf2923-0b96-434c-a82e-b9504b5438ac","block_type":"box","text":"as a result of such changes. Fur thermore, the securities regimes and legal systems of China and Hong Kong differ","page_number":88,"box":{"x":69,"y":906,"width":819,"height":12}},{"id":"2a523184-0199-4a14-93df-d285bb905e2b","block_type":"box","text":"II-44","page_number":88,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"dd6c13e6-bcd6-4d44-98c7-324197320da4","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":88,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"a52ae663-de12-4312-8744-93fa6c1159c3","block_type":"box","text":"significantly and issues may arise from the differences on an on-going basis. In the event that the relevant systems","page_number":89,"box":{"x":69,"y":45,"width":823,"height":11}},{"id":"8ae3c472-0148-4a3e-8441-63ab8113b7b7","block_type":"box","text":"fail to function properly, trading in both markets through Stock Connects could be disrupted and a Fund’s ability to","page_number":89,"box":{"x":68,"y":60,"width":814,"height":11}},{"id":"bf0fdaa2-e042-4855-89f2-273e08091ec7","block_type":"box","text":"achieve its investment objective may be adversely affected. In addition, a Fund’s investments in Stock Connect","page_number":89,"box":{"x":69,"y":75,"width":793,"height":11}},{"id":"cf0d194b-6b94-4b0d-9030-54df6b065b2f","block_type":"box","text":"Securities through Stock Connects are generally subject to Chinese securities regulations and listing rules, among","page_number":89,"box":{"x":69,"y":90,"width":815,"height":11}},{"id":"8769d99c-0ab0-4b7f-ad8c-37dae261e0b4","block_type":"box","text":"other restrictions. Fur ther, different fees, costs and taxes are imposed on foreign investors acquiring Stock Connect","page_number":89,"box":{"x":69,"y":105,"width":828,"height":11}},{"id":"cdd423d2-904a-4862-85bb-6bcb2b2d97c0","block_type":"box","text":"Securities through Stock Connects, and these fees, costs and taxes may be higher than comparable fees, costs and","page_number":89,"box":{"x":69,"y":120,"width":831,"height":12}},{"id":"afad9c40-016e-462a-9c20-f40b878694f0","block_type":"box","text":"taxes imposed on owners of other securities providing similar investment exposure.","page_number":89,"box":{"x":68,"y":135,"width":596,"height":12}},{"id":"4747eb08-7adb-4838-9c3c-b599fcd0aee9","block_type":"box","text":"Suspension Risk.","page_number":89,"box":{"x":102,"y":158,"width":122,"height":11}},{"id":"83763808-5ac9-4609-9ea0-229a0daf4f65","block_type":"box","text":"SSE Securities and SZSE Securities may only be bought from, or sold to, a Fund at times when","page_number":89,"box":{"x":231,"y":158,"width":675,"height":11}},{"id":"2b1bc40a-6a99-48e1-85b9-abde82cee08d","block_type":"box","text":"the relevant SSE Securities and SZSE Securities may be sold or purchased on the relevant Chinese stock exchange.","page_number":89,"box":{"x":68,"y":173,"width":829,"height":11}},{"id":"e4332334-3eda-4204-b569-c1fc8c6f9be4","block_type":"box","text":"The SSE Securities and SZSE Securities markets have a higher propensity for trading suspensions than many other","page_number":89,"box":{"x":68,"y":188,"width":823,"height":12}},{"id":"1719b85b-2ebc-4d78-9453-9f8e5200bef1","block_type":"box","text":"global equity markets. Each of the SEHK, SSE and SZSE reserves the right to suspend trading of SSE Securities and","page_number":89,"box":{"x":68,"y":203,"width":831,"height":12}},{"id":"bf5f39cf-ba81-4eaa-b3fb-fa72bd01101c","block_type":"box","text":"SZSE Securities purchased on the Stock Connects if necessary for ensuring an orderly and fair market and ensuring","page_number":89,"box":{"x":69,"y":218,"width":828,"height":12}},{"id":"cba3dd0c-1c86-4403-a612-35d27b59bf29","block_type":"box","text":"that risks are managed prudently. Consent from the relevant regulator would be sought before a suspension of","page_number":89,"box":{"x":68,"y":234,"width":791,"height":11}},{"id":"149d3725-d914-4438-84a1-58f88f63f7c2","block_type":"box","text":"Nor thbound trading is triggered. The relevant PRC government authority may also impose “circuit breakers” and other","page_number":89,"box":{"x":70,"y":249,"width":837,"height":11}},{"id":"f1bb4f08-8554-4be2-80b0-a7986991750c","block_type":"box","text":"measures to halt or suspend Nor thbound trading. Where a suspension in the Nor thbound trading through Stock","page_number":89,"box":{"x":69,"y":264,"width":796,"height":11}},{"id":"c800b22c-245d-4a8e-8f19-91c84bd84aed","block_type":"box","text":"Connect is effected, the Fund’s ability to access the PRC market will be adversely affected. Trading suspensions in","page_number":89,"box":{"x":69,"y":279,"width":820,"height":11}},{"id":"d00f667e-ccde-4645-9256-660c11d09a31","block_type":"box","text":"cer tain stocks could lead to greater market execution risk and costs for a Fund. The SSE and SZSE currently apply a","page_number":89,"box":{"x":69,"y":294,"width":829,"height":11}},{"id":"c7296907-df2c-4ffc-8306-711b979bfd9f","block_type":"box","text":"daily price limit, generally set at 10%, of the amount of fluctuation permitted in the prices of the relevant SSE","page_number":89,"box":{"x":69,"y":309,"width":778,"height":11}},{"id":"f55a16bc-d566-4aea-b2dd-7291a6256cd5","block_type":"box","text":"Securities and SZSE Securities during a single trading day. The daily price limit refers to price movements only and","page_number":89,"box":{"x":69,"y":324,"width":815,"height":12}},{"id":"4003b1cf-65ae-41ad-b9be-77835d7e8947","block_type":"box","text":"does not restrict trading within the relevant limit. There can be no assurance that a liquid market on an exchange will","page_number":89,"box":{"x":69,"y":340,"width":833,"height":11}},{"id":"efe8defb-3096-4282-8daf-d207ef5fd4cf","block_type":"box","text":"exist for any par ticular SSE Security or SZSE Security or for any par ticular time.","page_number":89,"box":{"x":69,"y":355,"width":563,"height":11}},{"id":"bc18c432-e09b-47bb-9a3a-7507897d8d25","block_type":"box","text":"Risk of Investing in the China Interbank Bond Market through Bond Connect.","page_number":89,"box":{"x":102,"y":377,"width":542,"height":12}},{"id":"8db75e83-ef98-42f7-a776-ef72df89f67d","block_type":"box","text":"A Fund may invest directly in the","page_number":89,"box":{"x":650,"y":377,"width":230,"height":11}},{"id":"2fbc235c-53c3-423e-81b0-74c861446ea1","block_type":"box","text":"domestic bond market in the PRC (the “China Interbank Bond Market”) through the nor thbound trading of Bond","page_number":89,"box":{"x":69,"y":392,"width":791,"height":12}},{"id":"efcc959c-99d3-42b6-991b-4a9c65af1135","block_type":"box","text":"Connect (“Bond Connect”). Bond Connect is an initiative launched in July 2017 for mutual bond market access","page_number":89,"box":{"x":69,"y":407,"width":790,"height":12}},{"id":"82e4784b-bbd0-4e88-be59-023946a09e0e","block_type":"box","text":"between the PRC and Hong Kong, established by the China Foreign Exchange Trade System & National Interbank","page_number":89,"box":{"x":69,"y":423,"width":803,"height":11}},{"id":"8b556b9f-7f19-454a-a66c-449d9f35f62b","block_type":"box","text":"Funding Centre (“CFETS”), China Central Depository & Clearing Co., Ltd (“CDCC”), Shanghai Clearing House (“SCH”),","page_number":89,"box":{"x":70,"y":438,"width":832,"height":11}},{"id":"2ae59bcd-208b-44ee-8857-2a7dd21a2bc9","block_type":"box","text":"Hong Kong Exchanges and Clearing Limited (“HKEX”) and Central Moneymarkets Unit (“CMU”). Under the prevailing","page_number":89,"box":{"x":70,"y":453,"width":821,"height":11}},{"id":"11495843-4faf-4f54-884e-1d7fc6be56ac","block_type":"box","text":"regulations in the PRC, eligible foreign investors are allowed to invest in the bonds circulated in the China Interbank","page_number":89,"box":{"x":69,"y":468,"width":825,"height":11}},{"id":"b01aba1b-9e36-42da-a440-9cf6142e07d6","block_type":"box","text":"Bond Market through Bond Connect. Eligible foreign investors may submit trade requests for bonds circulated in the","page_number":89,"box":{"x":70,"y":483,"width":825,"height":11}},{"id":"12d65ace-b673-4f9f-ae82-2963e44f64e3","block_type":"box","text":"China Interbank Bond Market through offshore electronic bond trading platforms (such as Tradeweb), which will in","page_number":89,"box":{"x":69,"y":498,"width":809,"height":11}},{"id":"ff57efb0-7a0b-4097-bcae-b6a415527b77","block_type":"box","text":"turn transmit their requests for quotation to CFETS. CFETS will send the requests for quotation to a number of","page_number":89,"box":{"x":68,"y":513,"width":786,"height":11}},{"id":"4f41907d-af3a-4130-9515-e0157400d3c5","block_type":"box","text":"approved onshore dealers (including market makers and others engaged in the market making business) in the PRC.","page_number":89,"box":{"x":69,"y":529,"width":830,"height":11}},{"id":"035beb92-f727-43c8-8518-9cde516397f5","block_type":"box","text":"The approved onshore dealer(s) will respond to the requests for quotation via CFETS and CFETS will send their","page_number":89,"box":{"x":68,"y":543,"width":788,"height":12}},{"id":"60b3184c-5e7c-4169-9b38-9294100da172","block_type":"box","text":"responses to those eligible foreign investors through the same offshore electronic bond trading platforms. Once the","page_number":89,"box":{"x":69,"y":559,"width":827,"height":11}},{"id":"c27f6670-e783-4137-b4b4-11acc9f02ba7","block_type":"box","text":"eligible foreign investor accepts the quotation, the trade is concluded on CFETS.","page_number":89,"box":{"x":69,"y":574,"width":570,"height":11}},{"id":"cbc1ff48-419c-41e1-92ec-0cec41f111e0","block_type":"box","text":"The settlement and custody of bonds traded in the China Interbank Bond Market under Bond Connect will be","page_number":89,"box":{"x":101,"y":596,"width":773,"height":12}},{"id":"198bbddf-44d2-4f5d-ab55-2dacf5fa8af7","block_type":"box","text":"effected through the settlement and custody link between CMU, as an offshore custody agent, and CDCC and SCH,","page_number":89,"box":{"x":69,"y":612,"width":823,"height":11}},{"id":"09e5b089-6542-4c5c-b0da-347d0e74811f","block_type":"box","text":"as onshore custodians and clearing institutions in the PRC. Under the settlement link, CDCC or SCH will effect gross","page_number":89,"box":{"x":69,"y":627,"width":832,"height":11}},{"id":"e6051b44-fabb-40c1-ac2a-3fadc175e944","block_type":"box","text":"settlement of confirmed trades onshore and CMU will process bond settlement instructions from CMU members on","page_number":89,"box":{"x":69,"y":642,"width":822,"height":11}},{"id":"b5d74206-289e-4d91-97d6-8c5095673681","block_type":"box","text":"behalf of eligible foreign investors in accordance with its relevant rules. Since the introduction in August 2018 of","page_number":89,"box":{"x":69,"y":657,"width":804,"height":11}},{"id":"abbb1b3a-7ccb-4d03-908a-240dfb0bea89","block_type":"box","text":"delivery versus payment (DVP) settlement in respect of Bond Connect, the movement of cash and securities is","page_number":89,"box":{"x":69,"y":672,"width":787,"height":11}},{"id":"8ac0e2e4-e3a7-4388-ab1c-a66e943fdb59","block_type":"box","text":"carried out simultaneously on a real-time basis. Pursuant to the prevailing regulations in the PRC, CMU, as the","page_number":89,"box":{"x":69,"y":687,"width":788,"height":11}},{"id":"9f5eac09-2470-435e-b16c-1ad63a5a3b9d","block_type":"box","text":"offshore custody agent recognized by the Hong Kong Monetary Authority, will open omnibus nominee accounts with","page_number":89,"box":{"x":69,"y":702,"width":820,"height":12}},{"id":"71c235ee-c0d3-4b39-bce9-12486260797a","block_type":"box","text":"the onshore custody agent recognized by the People’s Bank of China (","page_number":89,"box":{"x":68,"y":717,"width":500,"height":12}},{"id":"2aa0d883-68c3-4810-b407-869453c57485","block_type":"box","text":"i.e.","page_number":89,"box":{"x":570,"y":718,"width":20,"height":8}},{"id":"70f4e4f4-4c66-4ea2-a4db-09e2dbad7bee","block_type":"box","text":", CDCC and SCH). All bonds traded by","page_number":89,"box":{"x":593,"y":718,"width":267,"height":11}},{"id":"ed59dcdc-a7b6-462d-b65a-3d8ea94e99d7","block_type":"box","text":"eligible foreign investors through Bond Connect will be registered in the name of CMU, which will hold such bonds as","page_number":89,"box":{"x":69,"y":732,"width":832,"height":12}},{"id":"d4d527ac-f4f9-427b-9fd0-610dfa6ecda3","block_type":"box","text":"a nominee owner. Therefore, a Fund will be exposed to custody risks with respect to CMU. In the remote event of a","page_number":89,"box":{"x":69,"y":748,"width":819,"height":11}},{"id":"bc54ea29-96a5-4ef4-9eec-c20b0501a823","block_type":"box","text":"CDCC or SCH default, CMU’s liabilities in Bond Connect bonds under its market contracts with clearing par ticipants","page_number":89,"box":{"x":69,"y":763,"width":822,"height":11}},{"id":"699b6b16-8ffa-4385-b812-d2a3f6423dfd","block_type":"box","text":"will be limited to assisting clearing par ticipants in pursuing their claims against CDCC or SCH. The Fund may suffer","page_number":89,"box":{"x":68,"y":778,"width":822,"height":11}},{"id":"158a342c-b074-48f5-b207-5b686c1ce2fb","block_type":"box","text":"delay in the recovery process or may not fully recover its losses from CDCC or SCH. In addition, as the relevant","page_number":89,"box":{"x":69,"y":793,"width":793,"height":11}},{"id":"bd3cb6d2-35c4-4cda-b5b0-566e5708ff7d","block_type":"box","text":"filings, registration with the People’s Bank of China, and account opening have to be carried out by third par ties,","page_number":89,"box":{"x":68,"y":808,"width":802,"height":11}},{"id":"e240b8e8-c730-4fa1-9385-09b19eb4e889","block_type":"box","text":"including CMU, CDCC, SCH, and CFETS, a Fund is subject to the risks of default or errors on the par t of such third","page_number":89,"box":{"x":70,"y":823,"width":812,"height":12}},{"id":"38869c8f-180d-446b-9eeb-05e69396f743","block_type":"box","text":"par ties.","page_number":89,"box":{"x":70,"y":839,"width":52,"height":10}},{"id":"47213fdc-f27f-4989-a3a7-bd08b2913668","block_type":"box","text":"The precise nature and rights of a Fund as the beneficial owner of the bonds traded in the China Interbank Bond","page_number":89,"box":{"x":101,"y":861,"width":799,"height":11}},{"id":"244cc5ff-637f-402c-b585-2fcf247fa3dd","block_type":"box","text":"Market through CMU as nominee is not well-defined under PRC law. There is a lack of a clear definition of, and","page_number":89,"box":{"x":70,"y":876,"width":785,"height":11}},{"id":"feded808-b605-4888-8328-3b82fd3352de","block_type":"box","text":"distinction between, legal ownership and beneficial ownership under PRC law and there have been few cases","page_number":89,"box":{"x":69,"y":891,"width":776,"height":12}},{"id":"f568f18c-48cb-41aa-8ae0-bc6cd2f2f80b","block_type":"box","text":"II-45","page_number":89,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d6a65e54-764e-46cb-82ee-f0a0dacc5c86","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":89,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"eda71e82-25a6-4433-83ee-fae6fb4a43d1","block_type":"box","text":"involving a nominee account structure in the PRC cour ts. The exact nature and methods of enforcement of the rights","page_number":90,"box":{"x":70,"y":45,"width":830,"height":11}},{"id":"5d604e7f-10cc-42a8-afba-323752c18e41","block_type":"box","text":"and interests of a Fund under PRC law are also uncer tain.","page_number":90,"box":{"x":69,"y":60,"width":412,"height":9}},{"id":"e99d803b-61c9-47f2-a892-0cf128d5ecd5","block_type":"box","text":"Market volatility and potential lack of liquidity due to low trading volume of cer tain bonds in the China Interbank","page_number":90,"box":{"x":102,"y":82,"width":793,"height":12}},{"id":"a3d8710b-8559-40b1-8eb8-ffa22ec0be78","block_type":"box","text":"Bond Market may result in prices of cer tain bonds traded on such market fluctuating significantly. A Fund investing in","page_number":90,"box":{"x":70,"y":98,"width":832,"height":11}},{"id":"abed90d3-5df6-4f84-9f39-1f1a68df000f","block_type":"box","text":"such market is therefore subject to liquidity and volatility risks. The bid-ask spreads of the prices of such securities","page_number":90,"box":{"x":69,"y":113,"width":821,"height":11}},{"id":"26ec2a01-44e4-422d-a2c9-e7f9cadcce18","block_type":"box","text":"may be large, and a Fund may therefore incur significant costs and may suffer losses when selling such investments.","page_number":90,"box":{"x":69,"y":128,"width":836,"height":11}},{"id":"9345552b-f1f5-4447-9f5e-72495aa8e9ab","block_type":"box","text":"The bonds traded in the China Interbank Bond Market may be difficult or impossible to sell, which may impact a","page_number":90,"box":{"x":68,"y":143,"width":798,"height":11}},{"id":"5258e886-09bc-40e5-8161-ff851959eab9","block_type":"box","text":"Fund’s ability to acquire or dispose of such securities at their expected prices.","page_number":90,"box":{"x":70,"y":158,"width":556,"height":11}},{"id":"8092502f-82cf-45e8-b195-d8544bf93927","block_type":"box","text":"Investing in the China Interbank Bond Market through Bond Connect is also subject to regulatory risks. The","page_number":90,"box":{"x":102,"y":181,"width":762,"height":11}},{"id":"7ae5fdbc-7536-4c3b-972b-22fe9553f740","block_type":"box","text":"relevant rules and regulations are subject to change, which may have potential retrospective effect, and there can be","page_number":90,"box":{"x":69,"y":196,"width":835,"height":11}},{"id":"3e9cff9e-19f9-4004-ac28-37612991d3bb","block_type":"box","text":"no assurance that Bond Connect will not be discontinued or abolished. Fur thermore, the securities regimes and legal","page_number":90,"box":{"x":69,"y":211,"width":835,"height":11}},{"id":"ba633bba-0f0e-4bdc-9b8f-3fe173525a11","block_type":"box","text":"systems of China and Hong Kong differ significantly and issues may arise based on these differences. In the event","page_number":90,"box":{"x":69,"y":226,"width":820,"height":11}},{"id":"9091a79a-b2b9-4fe5-a0a2-21f85d8253e1","block_type":"box","text":"that the relevant authorities suspend account opening or trading on the China Interbank Bond Market, a Fund’s ability","page_number":90,"box":{"x":68,"y":241,"width":840,"height":11}},{"id":"04d0fc4c-d99b-4237-9523-f04255f7e52b","block_type":"box","text":"to invest in the China Interbank Bond Market will be adversely affected and limited. In such event, the Fund’s ability","page_number":90,"box":{"x":68,"y":256,"width":826,"height":11}},{"id":"5fe6e443-b780-44aa-b5f6-09dd07c348de","block_type":"box","text":"to achieve its investment objective will be negatively affected and, after exhausting other trading alternatives, the","page_number":90,"box":{"x":68,"y":271,"width":808,"height":12}},{"id":"af301c39-164e-461d-ad52-4cb840fd505b","block_type":"box","text":"Fund may suffer substantial losses as a result. Fur ther, if Bond Connect is not operating, a Fund may not be able to","page_number":90,"box":{"x":70,"y":286,"width":826,"height":12}},{"id":"91b0b5fe-e84e-4cb9-9a0e-92113804ecfb","block_type":"box","text":"acquire or dispose of bonds through Bond Connect in a timely manner, which could adversely affect the Fund’s","page_number":90,"box":{"x":69,"y":302,"width":789,"height":11}},{"id":"d37c1828-eb99-43df-9c08-c3a5c908f6f7","block_type":"box","text":"per formance.","page_number":90,"box":{"x":70,"y":317,"width":93,"height":11}},{"id":"cc75f1e1-0fbf-4660-8500-424b63eef0ce","block_type":"box","text":"Trading through Bond Connect is per formed through newly developed trading platforms and operational systems.","page_number":90,"box":{"x":101,"y":339,"width":803,"height":12}},{"id":"991d2814-38f9-4d7a-8688-0a58e40fb2e8","block_type":"box","text":"There is no assurance that such systems will function properly or will continue to be adapted to changes and","page_number":90,"box":{"x":68,"y":355,"width":776,"height":11}},{"id":"3b4f63a5-8de8-4049-abd2-c7f94b7467ec","block_type":"box","text":"developments in the market. In the event that the relevant systems fail to function properly, trading through Bond","page_number":90,"box":{"x":69,"y":370,"width":806,"height":11}},{"id":"2824eb05-e0b2-407b-b9bc-70b87e3a8eaf","block_type":"box","text":"Connect may be disrupted. A Fund’s ability to trade through Bond Connect (and hence to pursue its investment","page_number":90,"box":{"x":69,"y":385,"width":791,"height":11}},{"id":"f1c67071-73d0-4b22-a27e-a416a8abe5f3","block_type":"box","text":"strategy) may therefore be adversely affected. In addition, where a Fund invests in the China Interbank Bond Market","page_number":90,"box":{"x":69,"y":400,"width":827,"height":11}},{"id":"27031814-e1f0-45e7-ae73-855afd8708be","block_type":"box","text":"through Bond Connect, it may be subject to risks of delays inherent in the order placing and/or settlement systems.","page_number":90,"box":{"x":68,"y":415,"width":827,"height":11}},{"id":"149dcc06-cf50-4aba-ac79-f326ce240748","block_type":"box","text":"Bond Connect trades are settled in Chinese currency, the RMB, which is currently restricted and not freely","page_number":90,"box":{"x":102,"y":438,"width":755,"height":11}},{"id":"e0a361c9-7886-4809-a763-8ff8d8af8404","block_type":"box","text":"conver tible. As a result, a Fund will be exposed to currency risk, and it cannot be guaranteed that investors will have","page_number":90,"box":{"x":69,"y":453,"width":830,"height":11}},{"id":"daa27f2f-d3dd-4e4a-b6d0-a7e9f952fd41","block_type":"box","text":"timely access to a reliable supply of RMB.","page_number":90,"box":{"x":68,"y":468,"width":298,"height":11}},{"id":"d674748b-52e9-4f80-a4de-76b919783e05","block_type":"box","text":"Tax Risk – Withholding Income Tax Risk","page_number":90,"box":{"x":103,"y":491,"width":277,"height":11}},{"id":"4f0ed88c-dea2-43d7-a23e-62d394be913a","block_type":"box","text":".","page_number":90,"box":{"x":381,"y":498,"width":2,"height":2}},{"id":"1eccb8e0-cb69-42ca-8320-32db2699ad21","block_type":"box","text":"According to PRC tax regulations, a 10% withholding income tax is imposed on PRC sourced dividends and","page_number":90,"box":{"x":101,"y":513,"width":758,"height":12}},{"id":"53aaecd0-05ff-4938-b08c-1720d4be767a","block_type":"box","text":"interests from non-government bonds paid to a non-PRC tax resident enterprise, unless the rate is reduced under an","page_number":90,"box":{"x":70,"y":528,"width":828,"height":12}},{"id":"08466fc1-6db0-4a6b-b485-88c025d2e9bf","block_type":"box","text":"applicable tax treaty. From a technical perspective, withholding income tax is also applicable to capital gains realized","page_number":90,"box":{"x":69,"y":544,"width":831,"height":11}},{"id":"0c99e7a9-0a30-4d70-9534-16cfcdd2f46e","block_type":"box","text":"by foreign investors on the disposal of PRC equity interests.","page_number":90,"box":{"x":69,"y":559,"width":425,"height":11}},{"id":"b5bd981b-0b36-46c5-8407-8f96b39ea2c4","block_type":"box","text":"There are however cer tain tax exemptions available, some temporary in nature, highlighted below.","page_number":90,"box":{"x":101,"y":582,"width":697,"height":11}},{"id":"986393f4-71a4-478b-8046-7a6122acc650","block_type":"box","text":"On November 14, 2014, the Ministry of Finance (“MoF”), China Securities Regulatory Commission and the State","page_number":90,"box":{"x":102,"y":604,"width":803,"height":11}},{"id":"759d0d3d-d965-4943-acca-0b834156de05","block_type":"box","text":"Taxation Administration (“STA”), acting with State Council’s approval, jointly released Circular 79, which temporarily","page_number":90,"box":{"x":68,"y":619,"width":822,"height":11}},{"id":"dddfdfd1-6d51-4efc-bf4c-6fc248c3b1a6","block_type":"box","text":"exempts Qualified Foreign Institutional Investors (“QFIIs”) and Renminbi Qualified Foreign Institutional Investors","page_number":90,"box":{"x":69,"y":634,"width":794,"height":12}},{"id":"49210a1e-ef92-41a8-a679-26cc19444697","block_type":"box","text":"(“RQFIIs”) from tax on capital gains derived from the trading of shares and other equity interest investments on or","page_number":90,"box":{"x":69,"y":649,"width":812,"height":12}},{"id":"1dd36526-2612-4359-9357-5c8147611203","block_type":"box","text":"after November 17, 2014. Subsequently, Circulars 81 and 127 were issued to temporarily exempt tax on capital","page_number":90,"box":{"x":69,"y":664,"width":800,"height":12}},{"id":"54011f75-024c-457d-9dab-c72cb2c442d8","block_type":"box","text":"gains derived from trading of equity securities of companies domiciled in the PRC that trade on Chinese stock","page_number":90,"box":{"x":68,"y":680,"width":783,"height":11}},{"id":"b59e77d9-8ae0-457b-913a-f1e3da99b213","block_type":"box","text":"exchanges (“A-Shares”) through the Shanghai-Hong Kong Stock Connect program or the Shenzhen-Hong Kong Stock","page_number":90,"box":{"x":69,"y":695,"width":825,"height":11}},{"id":"4e3538fb-4456-4868-9c62-2bc604567a42","block_type":"box","text":"Connect program, as applicable (each, a “Stock Connect” and collectively, “Stock Connects”). The duration of the","page_number":90,"box":{"x":69,"y":710,"width":809,"height":11}},{"id":"4f2e4094-7ecc-498f-939f-0d52c276f866","block_type":"box","text":"temporary exemptions is not stated in the circulars and is subject to termination by the PRC tax authorities with or","page_number":90,"box":{"x":68,"y":725,"width":818,"height":11}},{"id":"a0f993be-70ce-4186-a5ed-18c39665e943","block_type":"box","text":"without notice.","page_number":90,"box":{"x":68,"y":740,"width":103,"height":9}},{"id":"2031ed41-e13c-46ab-b4bb-00263f25cb03","block_type":"box","text":"On November 22, 2018, the MoF and STA jointly issued Circular 108 which states that foreign institutional","page_number":90,"box":{"x":102,"y":763,"width":759,"height":11}},{"id":"e3bdc141-37ce-462f-8591-0e1f383e3466","block_type":"box","text":"investors are temporarily exempt from withholding income tax with respect to interest income on bonds derived from","page_number":90,"box":{"x":70,"y":778,"width":827,"height":11}},{"id":"3a57fcc4-fcfa-4237-9de7-1e98fa99b782","block_type":"box","text":"the PRC bond market from November 7, 2018 to November 6, 2021. On November 22, 2021, the MoF and STA","page_number":90,"box":{"x":68,"y":793,"width":798,"height":10}},{"id":"3a2be288-a8b4-40ab-8a6f-c4a0e0c46e10","block_type":"box","text":"issued Public Notice 34 to extend the temporary exemption from November 7, 2021 to December 31, 2025. On","page_number":90,"box":{"x":70,"y":808,"width":798,"height":11}},{"id":"f367bfb0-74dd-49e7-ab5c-fbfc70766e86","block_type":"box","text":"January 15, 2026, it was announced via Public Notice No. 5 of 2026 that the exemption was extended through","page_number":90,"box":{"x":69,"y":823,"width":792,"height":12}},{"id":"e00767f2-498e-4c56-bc49-2d0171109d4d","block_type":"box","text":"December 31, 2027.","page_number":90,"box":{"x":70,"y":838,"width":147,"height":11}},{"id":"e70575f4-6a67-495b-8e96-25ae2e80d6ed","block_type":"box","text":"Value Added Tax (“VAT”) Risk —","page_number":90,"box":{"x":103,"y":861,"width":225,"height":11}},{"id":"8a940f3e-8ba2-4f79-88a8-6d9ad42c461a","block_type":"box","text":"From May 1, 2016, VAT applies to cer tain income derived by the Fund, including","page_number":90,"box":{"x":333,"y":861,"width":569,"height":11}},{"id":"945dc865-a543-4612-b56b-9436dd878063","block_type":"box","text":"PRC sourced interest income on non-government bonds and trading gains.","page_number":90,"box":{"x":69,"y":876,"width":528,"height":11}},{"id":"5afbb12c-5825-4675-9a1e-b42aa51ffeda","block_type":"box","text":"There are however cer tain tax exemptions available, some temporary in nature, highlighted below.","page_number":90,"box":{"x":101,"y":899,"width":697,"height":11}},{"id":"6eac502e-b96f-4cbe-b014-9b78bebc7280","block_type":"box","text":"II-46","page_number":90,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"c0206c71-b1a3-415c-8780-556e6b4bd866","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":90,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"f4e28b7e-bc61-4631-b576-bb68ed3dfaf6","block_type":"box","text":"VAT exemptions currently apply to capital gains from trading of QFII and RQFII products, A-Shares traded on the","page_number":91,"box":{"x":101,"y":45,"width":789,"height":11}},{"id":"1b3ba3ad-64df-4d0c-a475-b55177e8d6c4","block_type":"box","text":"Stock Connects and debt securities traded in the China Interbank Bond Market.","page_number":91,"box":{"x":69,"y":60,"width":565,"height":9}},{"id":"da841f4d-b302-4dcf-82cf-b5eb16786d62","block_type":"box","text":"On November 7, 2018, the MoF and STA jointly issued Circular 108 which states that foreign institutional","page_number":91,"box":{"x":102,"y":82,"width":749,"height":12}},{"id":"638e1f2e-70f7-4c05-b2e4-c7cc6ac17c42","block_type":"box","text":"investors are temporarily exempt from VAT with respect to interest income on bonds derived from the PRC bond","page_number":91,"box":{"x":70,"y":98,"width":791,"height":11}},{"id":"d0da9c5f-84f1-4666-bd45-e0c699151c90","block_type":"box","text":"market from November 7, 2018 to November 6, 2021. On November 22, 2021, the MoF and STA jointly issued Public","page_number":91,"box":{"x":69,"y":113,"width":840,"height":11}},{"id":"3f11cede-3752-4f6a-9088-ed884a5fd791","block_type":"box","text":"Notice 34 to extend the temporary exemption from November 7, 2021 to December 31, 2025. However, on","page_number":91,"box":{"x":70,"y":128,"width":766,"height":11}},{"id":"356c2d89-00af-4929-9e4e-89a83f839026","block_type":"box","text":"July 31, 2025, the MoF and STA jointly issued Public Notice No 4 of 2025, stating that VAT will apply with respect to","page_number":91,"box":{"x":69,"y":143,"width":826,"height":11}},{"id":"75e1f069-8431-4b9c-afe5-6bd150733d19","block_type":"box","text":"interest income derived from treasury bonds, local government bonds and financial bonds issued on or after","page_number":91,"box":{"x":70,"y":158,"width":772,"height":11}},{"id":"fdca4aec-b753-4145-98c9-e7eb2b0327f4","block_type":"box","text":"August 8, 2025. It is understood that Public Notice No 4 of 2025 does not supersede the afore-mentioned exemption","page_number":91,"box":{"x":68,"y":173,"width":840,"height":11}},{"id":"2211b00c-dd6e-494c-b9a4-189ae9b42587","block_type":"box","text":"for foreign institutional investors. This exemption was extended through December 31, 2027.","page_number":91,"box":{"x":68,"y":188,"width":665,"height":12}},{"id":"34698698-7fd9-4876-becd-807d59ef5bba","block_type":"box","text":"Any changes in PRC tax law, future clarifications thereof, and/or subsequent retroactive enforcement by the PRC","page_number":91,"box":{"x":101,"y":211,"width":801,"height":11}},{"id":"eaf74946-e77c-4207-b867-3746386d2b4a","block_type":"box","text":"tax authorities may result in a loss which could be material to the Fund. There is a risk the PRC tax authorities may","page_number":91,"box":{"x":68,"y":226,"width":821,"height":11}},{"id":"d706a346-0125-4875-86ca-4e6528843b61","block_type":"box","text":"withdraw the temporary tax exemptions in the future and seek to collect taxes realized on the sale of A-Shares or","page_number":91,"box":{"x":68,"y":241,"width":808,"height":11}},{"id":"b94f6bcb-619f-4500-96d2-19642ae2a634","block_type":"box","text":"PCR sourced interest income on non-government bonds received by the Fund without giving any prior notice. If the","page_number":91,"box":{"x":69,"y":256,"width":810,"height":12}},{"id":"c9af12b7-c97f-4f68-8223-b5781d019773","block_type":"box","text":"temporary tax exemptions are withdrawn, any taxes may be directly borne by or indirectly passed on to the Fund and","page_number":91,"box":{"x":68,"y":272,"width":829,"height":11}},{"id":"0d24869a-861f-4231-923b-ff63aedcf35f","block_type":"box","text":"may result in a substantial impact to its net asset value. As with any net asset value adjustment, investors may be","page_number":91,"box":{"x":69,"y":287,"width":819,"height":11}},{"id":"a56f9e16-556c-4395-b2ba-92ea14b5041d","block_type":"box","text":"advantaged or disadvantaged depending on when the investors purchased and/or sold the shares of the Fund. There","page_number":91,"box":{"x":69,"y":302,"width":833,"height":11}},{"id":"f23f49d2-f6fc-49f6-8db1-db1ab1a76fad","block_type":"box","text":"will be no retrospective restatement of the Fund’s net asset value.","page_number":91,"box":{"x":68,"y":317,"width":474,"height":11}},{"id":"8f0ebb4f-af79-4945-82d6-e9d515b10382","block_type":"box","text":"BlackRock will keep the provisioning policy for tax liability under review and may, in its discretion from time to","page_number":91,"box":{"x":102,"y":339,"width":777,"height":12}},{"id":"61d4f470-57a3-4ca8-8774-b87c1328edea","block_type":"box","text":"time, make a provision for potential tax liabilities if in its opinion such provision is warranted or as fur ther clarified by","page_number":91,"box":{"x":68,"y":355,"width":836,"height":11}},{"id":"8f6732f6-94ad-42b0-a083-9835585b0317","block_type":"box","text":"the PRC in notifications.","page_number":91,"box":{"x":68,"y":370,"width":171,"height":9}},{"id":"d986a322-2441-48f9-af41-51c7d047a64c","block_type":"box","text":"Investment in Other Investment Companies.","page_number":91,"box":{"x":102,"y":392,"width":320,"height":11}},{"id":"3ec07fdc-528e-4f0f-92cb-e5ef7140e305","block_type":"box","text":"Each Fund may, subject to applicable law, invest in other","page_number":91,"box":{"x":429,"y":393,"width":402,"height":11}},{"id":"1f060223-89af-465b-9b6a-c72340fa82f6","block_type":"box","text":"investment companies (including investment companies managed by BlackRock and its affiliates), including money","page_number":91,"box":{"x":70,"y":407,"width":818,"height":12}},{"id":"10e58b42-e506-410d-8092-12965ead5cbb","block_type":"box","text":"market funds and ETFs, which are typically open-end funds or unit investment trusts listed on a stock exchange.","page_number":91,"box":{"x":69,"y":423,"width":797,"height":11}},{"id":"3e1753ce-19f7-424f-90f8-c1fd10f3c88c","block_type":"box","text":"Under Section 12(d)(1)(A) of the Investment Company Act, however, a Fund may invest up to 10% of its total assets","page_number":91,"box":{"x":70,"y":438,"width":822,"height":11}},{"id":"cd693c64-6a0f-433b-ac15-97243cb35c00","block_type":"box","text":"in securities of other investment companies (measured at the time of such investment). In addition, under Section","page_number":91,"box":{"x":70,"y":453,"width":814,"height":11}},{"id":"b5eeacb8-61d2-42fd-83fc-7cd812baec51","block_type":"box","text":"12(d)(1)(A) of the Investment Company Act a Fund may not acquire securities of an investment company if such","page_number":91,"box":{"x":70,"y":468,"width":793,"height":11}},{"id":"0f27a375-293b-47cf-ad7d-de08af74b863","block_type":"box","text":"acquisition would cause the Fund to own more than 3% of the total outstanding voting stock of such investment","page_number":91,"box":{"x":69,"y":483,"width":796,"height":11}},{"id":"df148ae0-a9b2-4584-ab7d-66603ed1ff6a","block_type":"box","text":"company and a Fund may not invest in another investment company if such investment would cause more than 5% of","page_number":91,"box":{"x":69,"y":498,"width":837,"height":11}},{"id":"dce0e909-5b87-4c7f-abd4-71fcca46bfd4","block_type":"box","text":"the value of the Fund’s total assets to be invested in securities of such investment company. (These limits do not","page_number":91,"box":{"x":68,"y":513,"width":812,"height":11}},{"id":"e60f008a-5dd3-4bf6-9941-44d571fef41c","block_type":"box","text":"restrict a Feeder Fund from investing all of its assets in shares of its Master Por tfolio.) In addition to the restrictions","page_number":91,"box":{"x":69,"y":528,"width":829,"height":12}},{"id":"3bf40ea6-9f0d-4bfc-9687-1be06cf16b84","block_type":"box","text":"on investing in other investment companies discussed above, under Section 12(d)(1)(C) of the Investment Company","page_number":91,"box":{"x":69,"y":543,"width":827,"height":12}},{"id":"28c2b031-7d39-42c6-9fc7-9be8c681d0f1","block_type":"box","text":"Act a Fund may not invest in a registered closed-end investment company if such investment would cause the Fund","page_number":91,"box":{"x":68,"y":559,"width":821,"height":11}},{"id":"6df0019a-df3c-4b81-bbe5-f6282f072b58","block_type":"box","text":"and other BlackRock-advised investment companies to own more than 10% of the total outstanding voting stock of","page_number":91,"box":{"x":69,"y":574,"width":817,"height":11}},{"id":"2631954a-fcb5-4aa2-ae2d-a243eb815389","block_type":"box","text":"such closed-end investment company. Pursuant to Section 12(d)(1)(G) of the Investment Company Act, these","page_number":91,"box":{"x":69,"y":589,"width":776,"height":11}},{"id":"8ed9fb51-ff4a-43e3-b1a9-b30faccbfc22","block_type":"box","text":"percentage limitations do not apply to investments in affiliated investment companies, including ETFs, subject to","page_number":91,"box":{"x":70,"y":604,"width":802,"height":11}},{"id":"b303f22d-c292-43c6-a9b8-164ef9aab848","block_type":"box","text":"cer tain conditions. In addition, a Fund may be able to rely on cer tain rules under the Investment Company Act to","page_number":91,"box":{"x":69,"y":619,"width":801,"height":11}},{"id":"3e1c9842-61ef-46f4-a1d0-95afc1a47859","block_type":"box","text":"invest in shares of money market funds or other investment companies beyond the statutory limits noted above, but","page_number":91,"box":{"x":70,"y":634,"width":829,"height":11}},{"id":"23a684c1-0323-4cc8-81db-1811e706ac69","block_type":"box","text":"subject to cer tain conditions.","page_number":91,"box":{"x":69,"y":650,"width":206,"height":10}},{"id":"54e5f8ce-4708-4888-b40a-ed924d5943f7","block_type":"box","text":"As with other investments, investments in other investment companies are subject to market and selection risk.","page_number":91,"box":{"x":101,"y":672,"width":799,"height":11}},{"id":"a97fc867-0a41-4f49-9a37-95c6418b978b","block_type":"box","text":"Shares of investment companies, such as closed-end fund investment companies, that trade on an exchange","page_number":91,"box":{"x":102,"y":695,"width":779,"height":11}},{"id":"2ad12517-761b-4cd7-9492-6361413bcd89","block_type":"box","text":"may at times be acquired at market prices representing premiums to their NAVs. In addition, investment companies","page_number":91,"box":{"x":69,"y":710,"width":824,"height":11}},{"id":"ab720dc4-88fe-47de-b5c1-e2974566aea0","block_type":"box","text":"held by a Fund that trade on an exchange could trade at a discount from NAV, and such discount could increase while","page_number":91,"box":{"x":69,"y":725,"width":836,"height":11}},{"id":"82e44a1c-11d1-4147-ac9d-59218765ca85","block_type":"box","text":"the Fund holds the shares. If the market price of shares of an exchange-traded investment company decreases below","page_number":91,"box":{"x":68,"y":740,"width":839,"height":11}},{"id":"6cd1893a-53a0-4954-93a4-8083fe92f855","block_type":"box","text":"the price that the Fund paid for the shares and the Fund were to sell its shares of such investment company at a","page_number":91,"box":{"x":68,"y":755,"width":806,"height":11}},{"id":"1c7a83b8-42a5-4e5a-9aa2-579b58f0dffa","block_type":"box","text":"time when the market price is lower than the price at which it purchased the shares, the Fund would experience a","page_number":91,"box":{"x":68,"y":771,"width":810,"height":10}},{"id":"495af6d9-2c30-4106-81d2-131608b725f2","block_type":"box","text":"loss.","page_number":91,"box":{"x":70,"y":786,"width":31,"height":8}},{"id":"88f472a9-9d93-4c20-b615-22b160eefd1f","block_type":"box","text":"In addition, if a Fund acquires shares in investment companies, including affiliated investment companies,","page_number":91,"box":{"x":102,"y":808,"width":758,"height":11}},{"id":"06783abb-0ba9-4c15-ad6d-cce2c0bc4380","block_type":"box","text":"shareholders would bear both their propor tionate share of expenses in the Fund and, indirectly, the expenses of such","page_number":91,"box":{"x":69,"y":823,"width":837,"height":11}},{"id":"0a27cd99-cf3e-4ab3-a5a5-9c80cafbfd9a","block_type":"box","text":"investment companies. Such expenses, both at the Fund level and acquired investment company level, would include","page_number":91,"box":{"x":70,"y":838,"width":835,"height":11}},{"id":"f8d3bcbe-538a-47e1-81ab-fb177d446d48","block_type":"box","text":"management and advisory fees, unless such fees have been waived by BlackRock. Please see the relevant Fund’s","page_number":91,"box":{"x":69,"y":853,"width":816,"height":12}},{"id":"5c482ea0-d0bd-4dc8-910c-473f956907dc","block_type":"box","text":"Prospectus to determine whether any such management and advisory fees have been waived by BlackRock.","page_number":91,"box":{"x":69,"y":869,"width":768,"height":11}},{"id":"c8eff5d7-2dc8-4ce5-85e4-fdcbb53151e6","block_type":"box","text":"Investments by a Fund in wholly owned investment entities created under the laws of cer tain countries will not be","page_number":91,"box":{"x":70,"y":884,"width":807,"height":11}},{"id":"00a72c54-bda9-423e-ab07-b459bced2373","block_type":"box","text":"deemed an investment in other investment companies. Pursuant to guidance issued by the staff of the Commission,","page_number":91,"box":{"x":69,"y":899,"width":830,"height":11}},{"id":"86ded4cc-33bf-4bd6-96a9-01ede295cf7b","block_type":"box","text":"II-47","page_number":91,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"6d0505a0-8303-4546-a8c2-fe2478a88360","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":91,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"abb8a46f-0031-4ccc-9bb1-94bd154236b2","block_type":"box","text":"fees and expenses of money market funds used for the investment of cash collateral received in connection with","page_number":92,"box":{"x":68,"y":45,"width":804,"height":11}},{"id":"99df062e-6c10-4648-a0e3-a5abdd8b2ba8","block_type":"box","text":"loans of Fund securities are not treated as “acquired fund fees and expenses,” which are fees and expenses","page_number":92,"box":{"x":70,"y":60,"width":778,"height":11}},{"id":"99b19212-1891-4872-857a-2e24b8e85813","block_type":"box","text":"charged by other investment companies and pooled investment vehicles in which a Fund invests a por tion of its","page_number":92,"box":{"x":69,"y":75,"width":796,"height":11}},{"id":"fac606fb-a3a6-4430-9c13-e4246aa40b3e","block_type":"box","text":"assets.","page_number":92,"box":{"x":69,"y":91,"width":51,"height":8}},{"id":"2792b164-0278-483e-8c16-a6561a9e86be","block_type":"box","text":"To the extent shares of a Fund are held by another fund, the ability of the Fund itself to purchase other funds","page_number":92,"box":{"x":101,"y":113,"width":776,"height":11}},{"id":"9a86b219-b08d-4d81-b4fa-789a5f572795","block_type":"box","text":"may be limited. In addition, a fund-of-funds (","page_number":92,"box":{"x":69,"y":128,"width":313,"height":11}},{"id":"f12820ee-21b6-4e17-bf2c-05f3b63649f4","block_type":"box","text":"e.g.","page_number":92,"box":{"x":384,"y":129,"width":24,"height":10}},{"id":"5c4786a3-21b6-4da7-bcd2-443c8238e761","block_type":"box","text":", an investment company that seeks to meet its investment objective","page_number":92,"box":{"x":411,"y":128,"width":491,"height":11}},{"id":"9d67ab5b-94f7-4338-a137-071942b79753","block_type":"box","text":"by investing significantly in other investment companies) may be limited in its ability to purchase underlying funds if","page_number":92,"box":{"x":69,"y":143,"width":823,"height":11}},{"id":"696388c6-6b25-46dc-a8c2-6979deaf3b1b","block_type":"box","text":"such underlying funds themselves own shares of underlying funds.","page_number":92,"box":{"x":69,"y":158,"width":472,"height":11}},{"id":"7836dfa3-76ff-4896-92e7-e3bdc1727381","block_type":"box","text":"A number of publicly traded closed-end investment companies have been organized to facilitate indirect foreign","page_number":92,"box":{"x":101,"y":181,"width":790,"height":11}},{"id":"02e9d23f-3b01-42d7-96e3-f4c7ffc91515","block_type":"box","text":"investment in developing countries, and cer tain of such countries, such as Thailand, South Korea, Chile and Brazil,","page_number":92,"box":{"x":70,"y":196,"width":818,"height":11}},{"id":"5ff9c85c-7271-49bf-a6c0-8d3f3b1212c5","block_type":"box","text":"have specifically authorized such funds. There also are investment oppor tunities in cer tain of such countries in","page_number":92,"box":{"x":69,"y":211,"width":791,"height":11}},{"id":"45f2f453-5814-41e1-a399-f38e8e156e94","block_type":"box","text":"pooled vehicles that resemble open-end investment companies. The restrictions on investments in securities of","page_number":92,"box":{"x":70,"y":226,"width":795,"height":11}},{"id":"a658677c-08bf-4042-bc8c-a19cf3a44e82","block_type":"box","text":"investment companies set for th above may limit oppor tunities for a Fund to invest indirectly in cer tain developing","page_number":92,"box":{"x":70,"y":241,"width":807,"height":11}},{"id":"d047535a-3026-4e69-a913-c82ef32f1b98","block_type":"box","text":"countries.","page_number":92,"box":{"x":69,"y":257,"width":69,"height":8}},{"id":"f3ce3688-0f06-4443-8afe-59d26401da84","block_type":"box","text":"Issuer Insolvency Risk.","page_number":92,"box":{"x":102,"y":279,"width":166,"height":11}},{"id":"aae248a9-d845-4d5a-88fb-ea8114e63b26","block_type":"box","text":"Cer tain Funds’ potential exposure to financially or operationally troubled issuers involves","page_number":92,"box":{"x":275,"y":279,"width":631,"height":11}},{"id":"0831e969-cd38-42e1-bf44-899cb7b85d2e","block_type":"box","text":"a high degree of credit and market risk, which may be heightened during an economic downturn or recession. Should","page_number":92,"box":{"x":69,"y":294,"width":832,"height":11}},{"id":"425ccbfe-a5fb-40ad-88f2-78aab9a7beb8","block_type":"box","text":"an issuer of securities held by a Fund become involved in a bankruptcy proceeding, reorganization or financial","page_number":92,"box":{"x":69,"y":309,"width":781,"height":11}},{"id":"d3bfbefa-dd6b-42e7-a062-2e5dded7f1a3","block_type":"box","text":"restructuring, a wide variety of considerations make an evaluation of the outcome of the Fund’s exposure to the","page_number":92,"box":{"x":69,"y":324,"width":797,"height":12}},{"id":"96e2fa54-d421-48d1-b98f-1fe3ae558caa","block_type":"box","text":"issuer uncer tain.","page_number":92,"box":{"x":70,"y":340,"width":118,"height":8}},{"id":"7de29847-6487-4e0b-b45a-ab76c1948a36","block_type":"box","text":"During the period of a bankruptcy proceeding, reorganization or financial restructuring, it is unlikely that a Fund","page_number":92,"box":{"x":102,"y":362,"width":788,"height":11}},{"id":"8b9b2567-9c68-44d6-8d76-fa80409ba7d3","block_type":"box","text":"will receive any interest payments on the securities of the issuer. A Fund will be subject to significant uncer tainty as","page_number":92,"box":{"x":68,"y":377,"width":827,"height":12}},{"id":"86df95b1-bc19-49d0-8657-5d43f7a55641","block_type":"box","text":"to whether the reorganization or restructuring will be completed, and the Fund may bear cer tain extraordinary","page_number":92,"box":{"x":68,"y":393,"width":779,"height":11}},{"id":"41845a44-3fc5-455d-9ae9-6a6d16e5c225","block_type":"box","text":"expenses to protect and recover its investment. A Fund will also be subject to significant uncer tainty as to when and","page_number":92,"box":{"x":69,"y":407,"width":829,"height":12}},{"id":"6a33a764-433c-4118-bd4d-b574c3198695","block_type":"box","text":"in what manner and for what value the obligations evidenced by the securities of the issuer held by the Fund will","page_number":92,"box":{"x":70,"y":423,"width":797,"height":11}},{"id":"e6973054-f453-422a-bc80-4270fd8bb89c","block_type":"box","text":"eventually be satisfied.","page_number":92,"box":{"x":69,"y":438,"width":162,"height":11}},{"id":"5cebdb51-c120-4db9-abef-3d74e8be0182","block_type":"box","text":"Even if a plan of reorganization or restructuring is adopted with respect to the securities of the issuer held by the","page_number":92,"box":{"x":102,"y":460,"width":805,"height":12}},{"id":"94d7e874-cc74-4b3c-99a7-be6005aec5b3","block_type":"box","text":"Fund, there can be no assurance that the securities or other assets received by a Fund in connection with such plan","page_number":92,"box":{"x":70,"y":476,"width":827,"height":11}},{"id":"a2c9f2b3-abde-41b6-beb0-1155377d494e","block_type":"box","text":"of reorganization or restructuring will not have a lower value or income potential than may have been anticipated or","page_number":92,"box":{"x":69,"y":491,"width":819,"height":11}},{"id":"a6e0500a-f435-4e92-927d-f22089d08b5d","block_type":"box","text":"no value. A Fund may be unable to enforce its claims or rights in any collateral or may have its claims or security","page_number":92,"box":{"x":69,"y":506,"width":802,"height":11}},{"id":"afee94ec-1ba0-4304-8084-767ba6ed8284","block_type":"box","text":"interest in any collateral challenged, disallowed or subordinated to the claims or security interests of other creditors.","page_number":92,"box":{"x":70,"y":521,"width":830,"height":11}},{"id":"143a7670-0718-4dcf-8c17-1c0bca94948a","block_type":"box","text":"In addition, amendments to the U.S. Bankruptcy Code or other relevant laws could alter the expected outcome or","page_number":92,"box":{"x":70,"y":536,"width":805,"height":11}},{"id":"c4927f52-b249-4780-85d7-a2ca6503a621","block_type":"box","text":"introduce greater uncer tainty regarding the outcome of the Fund’s securities holdings in the issuer. In a bankruptcy","page_number":92,"box":{"x":70,"y":551,"width":820,"height":11}},{"id":"4b79b3a7-41c6-4e1c-b27d-088f8796268b","block_type":"box","text":"proceeding, a reorganization or restructuring, the securities of the issuer held by a Fund could be re-characterized or","page_number":92,"box":{"x":70,"y":566,"width":828,"height":11}},{"id":"bbf38c30-29a6-4949-979c-e50a2ece4de6","block_type":"box","text":"a Fund may receive different securities or other assets, including equity securities. These types of equity securities","page_number":92,"box":{"x":69,"y":581,"width":820,"height":12}},{"id":"93a7f68d-e86c-4389-a117-e49f7f3a9e40","block_type":"box","text":"include, but are not limited to: common stock; preferred stock (including conver tible preferred stock); bonds, notes","page_number":92,"box":{"x":70,"y":596,"width":820,"height":12}},{"id":"ece2c387-bb0f-4a8a-abea-e019c14c0e91","block_type":"box","text":"and debentures conver tible into common or preferred stock; stock purchase warrants and rights; equity interests in","page_number":92,"box":{"x":69,"y":612,"width":824,"height":11}},{"id":"3ed95ac9-09d9-4122-a33f-d336f552d96a","block_type":"box","text":"trusts; and depositary receipts. Equity securities are subject to changes in value, and their value may be more","page_number":92,"box":{"x":68,"y":627,"width":788,"height":11}},{"id":"c545464d-80ac-430b-872e-efef5067abf6","block_type":"box","text":"volatile than those of other asset classes. Holders of equity securities are subject to more risk than holders of debt","page_number":92,"box":{"x":68,"y":642,"width":826,"height":11}},{"id":"8bf3b161-92af-4b38-bb02-fa022d767e20","block_type":"box","text":"securities because the status of equity holders is subordinate to debtholders in an issuer’s capital structure. The","page_number":92,"box":{"x":69,"y":657,"width":809,"height":11}},{"id":"00407ba5-ad91-4ad0-86c7-c2a4192ab950","block_type":"box","text":"value of equity securities received by a Fund could decline if the financial condition of the issuer deteriorates or if","page_number":92,"box":{"x":68,"y":672,"width":809,"height":11}},{"id":"5b9c63de-4d39-4034-adaf-adb2a268dedb","block_type":"box","text":"overall market and economic conditions, or conditions within the issuer’s region or industry, deteriorate.","page_number":92,"box":{"x":69,"y":687,"width":741,"height":11}},{"id":"e45fb4af-8887-498e-8798-b2afc7a5ab20","block_type":"box","text":"To the extent that a Fund receives other assets in connection with a bankruptcy proceeding, reorganization or","page_number":92,"box":{"x":101,"y":710,"width":780,"height":11}},{"id":"1c4369e8-d062-4ea2-8836-86d31abf3ab1","block_type":"box","text":"financial restructuring, the Fund may also be subject to additional risks associated with the assets received. One","page_number":92,"box":{"x":68,"y":725,"width":807,"height":11}},{"id":"49d50650-e763-4fe0-9798-05b5214440bb","block_type":"box","text":"example of assets that a Fund could receive is an interest in one or more loans made to the issuer as par t of a","page_number":92,"box":{"x":69,"y":740,"width":795,"height":11}},{"id":"5e48a5c8-ad8c-47ad-9b3f-c98368bcafc8","block_type":"box","text":"workout agreed to by a consor tium of lienholders and creditors of the issuer. A Fund may receive such interests in","page_number":92,"box":{"x":68,"y":755,"width":814,"height":11}},{"id":"6514f424-5263-4de0-baa4-fa06b204f802","block_type":"box","text":"loans to the extent permitted by the Investment Company Act.","page_number":92,"box":{"x":70,"y":770,"width":439,"height":11}},{"id":"a9586480-ae08-4ee5-9388-279293201df3","block_type":"box","text":"Securities or other assets received in a reorganization or restructuring typically entail a higher degree of risk than","page_number":92,"box":{"x":102,"y":793,"width":806,"height":11}},{"id":"bc5fd5ab-dc39-4e6e-8fc2-a709995bf106","block_type":"box","text":"investments in securities of issuers that have not undergone a reorganization or restructuring and may be subject to","page_number":92,"box":{"x":70,"y":808,"width":829,"height":11}},{"id":"48f81d05-41cc-429f-bf19-547c8fd3fe5b","block_type":"box","text":"heavy selling or downward pricing pressure after completion of the reorganization or restructuring. The post","page_number":92,"box":{"x":69,"y":823,"width":767,"height":12}},{"id":"fdc5cba1-991a-48ab-bea9-3dcf7adcca69","block_type":"box","text":"reorganization/restructuring assets and securities may also be illiquid and difficult to sell or value. If a Fund","page_number":92,"box":{"x":69,"y":838,"width":771,"height":12}},{"id":"2abd1871-834e-4417-833d-55acb230af8c","block_type":"box","text":"par ticipates in negotiations with respect to a plan of reorganization or restructuring with respect to securities of the","page_number":92,"box":{"x":70,"y":853,"width":823,"height":12}},{"id":"5465fe90-c166-4b5d-8272-81f1ce2ee552","block_type":"box","text":"issuer held by a Fund, the Fund also may be restricted from disposing such securities for a period of time. If a Fund","page_number":92,"box":{"x":70,"y":869,"width":822,"height":11}},{"id":"2ad14c85-77ed-420a-b291-1eaf6c24f195","block_type":"box","text":"becomes involved in such proceedings, the Fund may have more active par ticipation in the affairs of the issuer than","page_number":92,"box":{"x":69,"y":884,"width":828,"height":11}},{"id":"899f5e5f-3746-4576-b53d-bc9cfec656d4","block_type":"box","text":"that assumed generally by an investor.","page_number":92,"box":{"x":68,"y":899,"width":274,"height":11}},{"id":"f6f8933f-1d26-4921-9559-4c2138c21609","block_type":"box","text":"II-48","page_number":92,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"1b25c575-7b31-4bc2-8bed-7702777e578a","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":92,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"68f53b21-e1dc-4b97-9d6b-b58cd6d94458","block_type":"box","text":"Lease Obligations.","page_number":93,"box":{"x":102,"y":45,"width":133,"height":11}},{"id":"c7d0b445-7416-4f81-9113-1be4234e459b","block_type":"box","text":"A Fund may hold par ticipation cer tificates in a lease, an installment purchase contract, or a","page_number":93,"box":{"x":241,"y":45,"width":653,"height":11}},{"id":"52a4f325-51c4-4653-91ba-256c9cf2964a","block_type":"box","text":"conditional sales contract (“lease obligations”). The Manager will monitor the credit standing of each borrower and","page_number":93,"box":{"x":69,"y":60,"width":816,"height":11}},{"id":"d9058769-7425-4552-910d-99272040ddff","block_type":"box","text":"each entity providing credit suppor t and/or a put option relating to lease obligations.","page_number":93,"box":{"x":69,"y":75,"width":602,"height":11}},{"id":"46b7a71b-bbeb-4b05-bbee-6c84fe10b962","block_type":"box","text":"Life Settlement Investments.","page_number":93,"box":{"x":102,"y":98,"width":210,"height":9}},{"id":"857e38f4-d051-40f1-be45-3cec3c960b99","block_type":"box","text":"A Fund may invest in life settlements, which are sales to third par ties, such as the","page_number":93,"box":{"x":318,"y":98,"width":589,"height":11}},{"id":"874402bb-4215-4f8d-8a03-df276aa691e5","block_type":"box","text":"Fund, of existing life insurance contracts for more than their cash surrender value but less than the net benefits to be","page_number":93,"box":{"x":70,"y":113,"width":838,"height":11}},{"id":"17f265a8-4d9b-4a68-9dc8-08c5efb065b7","block_type":"box","text":"paid under the policies. When a Fund acquires such a contract, it pays the policy premiums in return for the expected","page_number":93,"box":{"x":70,"y":128,"width":834,"height":11}},{"id":"685f6475-e1a1-45e1-b72a-133e859f5619","block_type":"box","text":"receipt of the net benefit as the beneficiary under the policy. Investments in these contracts involve cer tain risks,","page_number":93,"box":{"x":69,"y":143,"width":808,"height":11}},{"id":"dfab9310-6d84-4960-be27-22e19376c6cb","block_type":"box","text":"including liquidity risk, credit risk of the insurance company, and inaccurate estimations of life expectancy of the","page_number":93,"box":{"x":70,"y":158,"width":797,"height":11}},{"id":"707ccc3f-4343-4034-b03b-bd16a5b02e18","block_type":"box","text":"insured individuals (viators). These policies may be considered illiquid because they are bought and sold in a","page_number":93,"box":{"x":70,"y":173,"width":775,"height":11}},{"id":"29d60888-43da-4b87-a82b-6747b88aab05","block_type":"box","text":"secondary market through life settlement agents. Also, in the event of a bankruptcy of the insurance carrier for a","page_number":93,"box":{"x":69,"y":188,"width":805,"height":12}},{"id":"6234e4c8-531a-42f2-88f5-8cddda135e93","block_type":"box","text":"policy, the Fund may receive reduced or no benefits under the contract. A Fund seeks to minimize credit risk by","page_number":93,"box":{"x":70,"y":203,"width":789,"height":12}},{"id":"d1ed4805-b3cc-4a12-a93d-11e2e5af18c2","block_type":"box","text":"investing in policies issued by a diverse range of highly-rated insurance carriers. Fur thermore, a Fund may encounter","page_number":93,"box":{"x":70,"y":218,"width":829,"height":12}},{"id":"cbb4c1f8-8f99-4704-826b-c3f9d17e4256","block_type":"box","text":"losses on its investments if there is an inaccurate estimation of the life expectancies of viators. A Fund intends to","page_number":93,"box":{"x":70,"y":234,"width":813,"height":11}},{"id":"4e1f19d1-fb13-4d9f-b94b-24cfb904956d","block_type":"box","text":"reduce this life expectancy risk by investing only in contracts where the life expectancy was reviewed by an","page_number":93,"box":{"x":69,"y":249,"width":758,"height":11}},{"id":"439e5680-9e79-4ceb-ae02-01473666fa18","block_type":"box","text":"experienced actuary, as well as by diversifying its investments across viators of varying ages and medical profiles. In","page_number":93,"box":{"x":69,"y":264,"width":832,"height":11}},{"id":"86161055-6ba5-4e15-8937-5776196225fa","block_type":"box","text":"addition, it is unclear whether the income from life settlements is qualifying income for purposes of the IRS 90%","page_number":93,"box":{"x":69,"y":279,"width":800,"height":11}},{"id":"f11308f6-c2f4-4886-b5dd-e3d716769d2d","block_type":"box","text":"gross income test a Fund must satisfy each year to qualify as a regulated investment company. A Fund intends to","page_number":93,"box":{"x":68,"y":294,"width":809,"height":11}},{"id":"e9900e63-707d-4ee6-97dd-233bf0458972","block_type":"box","text":"monitor its investments to ensure that the Fund remains qualified as a regulated investment company.","page_number":93,"box":{"x":69,"y":309,"width":730,"height":11}},{"id":"e329e973-4747-4bf9-a6cf-4b0d24b7ee91","block_type":"box","text":"Liquidity Risk Management.","page_number":93,"box":{"x":102,"y":332,"width":202,"height":11}},{"id":"6fb50460-9c17-42be-86d2-6638d108b564","block_type":"box","text":"Rule 22e-4 under the Investment Company Act (the “Liquidity Rule”) requires open","page_number":93,"box":{"x":311,"y":332,"width":591,"height":11}},{"id":"547602e3-9f98-42ab-923e-eb6402f22169","block_type":"box","text":"end funds, such as the Funds, to adopt a liquidity risk management program and enhance disclosures regarding fund","page_number":93,"box":{"x":69,"y":347,"width":835,"height":11}},{"id":"82fe2e23-306e-40b0-a85e-49a536bf3141","block_type":"box","text":"liquidity. As required by the Liquidity Rule, the Funds have implemented a liquidity risk management program (the","page_number":93,"box":{"x":70,"y":362,"width":803,"height":11}},{"id":"7f492343-e4b6-4c8f-87e1-4875538b809c","block_type":"box","text":"“Liquidity Program”), and the Boards of Directors of the Funds, including a majority of the independent Directors,","page_number":93,"box":{"x":70,"y":377,"width":801,"height":12}},{"id":"c81196f6-069c-4cd9-aa24-366a8fb1b8be","block_type":"box","text":"have appointed the Manager as the liquidity risk program administrator of the Liquidity Program. Under the Liquidity","page_number":93,"box":{"x":69,"y":392,"width":822,"height":12}},{"id":"05f21670-b6ce-45a9-a0e0-6873f8ae37bf","block_type":"box","text":"Program, the Manager assesses, manages, and periodically reviews each Fund’s liquidity risk and classifies each","page_number":93,"box":{"x":69,"y":407,"width":808,"height":12}},{"id":"c889237f-6946-4bd9-8798-5cd1eedb3b1d","block_type":"box","text":"investment held by a Fund as a “highly liquid investment,” “moderately liquid investment,” “less liquid investment” or","page_number":93,"box":{"x":70,"y":423,"width":838,"height":11}},{"id":"7c5502bb-0ca9-4af6-82a3-374096918106","block_type":"box","text":"“illiquid investment.” The Liquidity Rule defines “liquidity risk” as the risk that a Fund could not meet requests to","page_number":93,"box":{"x":70,"y":438,"width":804,"height":11}},{"id":"a3c37ff8-0b93-4283-a10c-937dd3565407","block_type":"box","text":"redeem shares issued by the Fund without significant dilution of the remaining investors’ interests in the Fund. The","page_number":93,"box":{"x":69,"y":453,"width":821,"height":11}},{"id":"133f6f1c-a4e6-4f04-8cac-29774495559f","block_type":"box","text":"liquidity of a Fund’s por tfolio investments is determined based on relevant market, trading and investment-specific","page_number":93,"box":{"x":70,"y":468,"width":815,"height":11}},{"id":"d850b0e1-a866-4c41-aa4f-75d4b8f53a35","block_type":"box","text":"considerations under the Liquidity Program. To the extent that an investment is deemed to be an illiquid investment","page_number":93,"box":{"x":69,"y":483,"width":823,"height":11}},{"id":"57493fcf-085e-4d77-8399-1bb9809fe677","block_type":"box","text":"or a less liquid investment, a Fund can expect to be exposed to greater liquidity risk.","page_number":93,"box":{"x":69,"y":498,"width":601,"height":11}},{"id":"13e20a79-7cc7-4dca-87a3-0b7875b9b20a","block_type":"box","text":"Master Limited Partnerships.","page_number":93,"box":{"x":102,"y":521,"width":211,"height":11}},{"id":"297dc0b3-e85a-4f45-93b3-41467792858e","block_type":"box","text":"Cer tain Funds may invest in publicly traded master limited par tnerships (“MLPs”)","page_number":93,"box":{"x":320,"y":521,"width":577,"height":11}},{"id":"1f7f800c-c12c-48d7-9583-2c6962c5e106","block_type":"box","text":"which are limited par tnerships or limited liability companies taxable as par tnerships. MLPs may derive income and","page_number":93,"box":{"x":68,"y":536,"width":816,"height":11}},{"id":"a21db836-7773-4125-b721-2f42a641b724","block_type":"box","text":"gains from the exploration, development, mining or production, processing, refining, transpor tation (including","page_number":93,"box":{"x":68,"y":551,"width":777,"height":11}},{"id":"0d337699-daa8-4184-b224-8788bd8f0934","block_type":"box","text":"pipelines transpor ting gas, oil, or products thereof), or the marketing of any mineral or natural resources. MLPs","page_number":93,"box":{"x":70,"y":566,"width":792,"height":11}},{"id":"9d2176ac-0d63-4d81-afc1-69d032a91816","block_type":"box","text":"generally have two classes of owners, the general par tner and limited par tners. When investing in an MLP, a Fund","page_number":93,"box":{"x":68,"y":581,"width":811,"height":12}},{"id":"5b8af676-b039-4c72-acb6-29e7085e989c","block_type":"box","text":"intends to purchase publicly traded common units issued to limited par tners of the MLP. The general par tner is","page_number":93,"box":{"x":70,"y":596,"width":791,"height":12}},{"id":"476bcd0a-cc12-4188-8cf3-95687691e040","block_type":"box","text":"typically owned by a major energy company, an investment fund, the direct management of the MLP or is an entity","page_number":93,"box":{"x":68,"y":612,"width":812,"height":11}},{"id":"11dff35c-98e3-4a57-a734-5e5eb6c3c1de","block_type":"box","text":"owned by one or more of such par ties. The general par tner may be structured as a private or publicly traded","page_number":93,"box":{"x":69,"y":627,"width":770,"height":11}},{"id":"4cfc4f60-16ee-4091-9a94-78fd7d31ea11","block_type":"box","text":"corporation or other entity. The general par tner typically controls the operations and management of the MLP through","page_number":93,"box":{"x":69,"y":642,"width":833,"height":11}},{"id":"f079213f-7f5f-40c4-9e84-81f14ce52448","block_type":"box","text":"an up to 2% equity interest in the MLP plus, in many cases, ownership of common units and subordinated units.","page_number":93,"box":{"x":69,"y":657,"width":799,"height":11}},{"id":"fdf1d54d-3b33-4d37-a314-4953bc040772","block_type":"box","text":"Limited par tners own the remainder of the par tnership, through ownership of common units, and have a limited role","page_number":93,"box":{"x":70,"y":672,"width":825,"height":11}},{"id":"a6bb9c7b-465b-489e-a584-073e287c4b29","block_type":"box","text":"in the par tnership’s operations and management.","page_number":93,"box":{"x":70,"y":687,"width":352,"height":11}},{"id":"583017ee-5c55-448c-a9c3-9951405ff886","block_type":"box","text":"MLPs are typically structured such that common units and general par tner interests have first priority to receive","page_number":93,"box":{"x":102,"y":710,"width":794,"height":11}},{"id":"19b1755d-7e3d-4dac-90ba-6a62ee140f26","block_type":"box","text":"quar terly cash distributions up to an established minimum amount (“minimum quar terly distributions” or “MQD”).","page_number":93,"box":{"x":69,"y":725,"width":809,"height":11}},{"id":"3f7deb0f-28c1-4127-92d6-97f790d4881c","block_type":"box","text":"Common and general par tner interests also accrue arrearages in distributions to the extent the MQD is not paid.","page_number":93,"box":{"x":69,"y":740,"width":804,"height":11}},{"id":"f6fe3e55-ce30-4065-a85b-2ca35a0536da","block_type":"box","text":"Once common and general par tner interests have been paid, subordinated units receive distributions of up to the","page_number":93,"box":{"x":69,"y":755,"width":808,"height":11}},{"id":"84a55eac-6f7b-43a9-9399-efb25cb73b46","block_type":"box","text":"MQD; however, subordinated units do not accrue arrearages. Distributable cash in excess of the MQD paid to both","page_number":93,"box":{"x":70,"y":770,"width":816,"height":12}},{"id":"4e20d74e-4f97-42e1-bb6c-9b5beafea94b","block_type":"box","text":"common and subordinated units is distributed to both common and subordinated units generally on a pro rata basis.","page_number":93,"box":{"x":69,"y":786,"width":831,"height":11}},{"id":"a2dffcf1-de71-493d-9e65-185896d59f5a","block_type":"box","text":"The general par tner is also eligible to receive incentive distributions if the general par tner operates the business in a","page_number":93,"box":{"x":68,"y":801,"width":835,"height":11}},{"id":"040dbb90-0758-4835-a137-621e41b04772","block_type":"box","text":"manner which results in distributions paid per common unit surpassing specified target levels. As the general par tner","page_number":93,"box":{"x":69,"y":816,"width":838,"height":11}},{"id":"ef062a5a-7ef9-4bed-aded-9b2abdbc0312","block_type":"box","text":"increases cash distributions to the limited par tners, the general par tner receives an increasingly higher percentage of","page_number":93,"box":{"x":70,"y":831,"width":839,"height":11}},{"id":"234b2a13-6ec0-4561-b8ac-aace49b34a24","block_type":"box","text":"the incremental cash distributions. A common arrangement provides that the general par tner can reach a tier where","page_number":93,"box":{"x":68,"y":846,"width":828,"height":11}},{"id":"d8f6e01b-fbad-4840-8d9c-e6a8a9ffa2b1","block_type":"box","text":"it receives 50% of every incremental dollar paid to common and subordinated unit holders. These incentive","page_number":93,"box":{"x":70,"y":861,"width":761,"height":11}},{"id":"ac5efb32-6b53-4569-a06f-2bdea33c3d5b","block_type":"box","text":"distributions encourage the general par tner to streamline costs, increase capital expenditures and acquire assets in","page_number":93,"box":{"x":69,"y":876,"width":830,"height":11}},{"id":"513924d8-3226-4ff8-9e0f-dc344a5eec7c","block_type":"box","text":"order to increase the par tnership’s cash flow and raise the quar terly cash distribution in order to reach higher tiers.","page_number":93,"box":{"x":69,"y":891,"width":824,"height":12}},{"id":"a2127075-fd16-4e04-b39d-57016410d7ae","block_type":"box","text":"Such results benefit all security holders of the MLP.","page_number":93,"box":{"x":69,"y":906,"width":366,"height":12}},{"id":"7abdacfa-aedd-4eb3-91cd-56210368e139","block_type":"box","text":"II-49","page_number":93,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f290a8ef-e4a4-4978-8057-1c9be45418ce","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":93,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"6b54e8cc-7648-4bc9-9e42-24b7f32cc628","block_type":"box","text":"MLP common units represent a limited par tnership interest in the MLP. Common units are listed and traded on","page_number":94,"box":{"x":102,"y":45,"width":790,"height":11}},{"id":"0d3ac67a-677b-4c07-8737-c20650798b0e","block_type":"box","text":"U.S. securities exchanges, with their value fluctuating predominantly based on prevailing market conditions and the","page_number":94,"box":{"x":70,"y":60,"width":820,"height":11}},{"id":"49bcd28a-c7dd-4875-a94d-5d7da1c0718b","block_type":"box","text":"success of the MLP. Cer tain Funds intend to purchase common units in market transactions. Unlike owners of","page_number":94,"box":{"x":69,"y":75,"width":787,"height":11}},{"id":"a739f594-ed7d-4b6d-b765-f83b70f263e0","block_type":"box","text":"common stock of a corporation, owners of common units have limited voting rights and have no ability to annually","page_number":94,"box":{"x":69,"y":90,"width":810,"height":11}},{"id":"93adc984-7c56-4e29-a835-fe0bcbfba135","block_type":"box","text":"elect directors. In the event of liquidation, common units have preference over subordinated units, but not over debt","page_number":94,"box":{"x":69,"y":105,"width":828,"height":11}},{"id":"4e273367-fb72-4fa3-b5ae-b73daf7fe209","block_type":"box","text":"or preferred units, to the remaining assets of the MLP.","page_number":94,"box":{"x":69,"y":120,"width":387,"height":12}},{"id":"af2c11bc-1251-4641-b886-a68e7b543edf","block_type":"box","text":"Merger Transaction Risk.","page_number":94,"box":{"x":102,"y":143,"width":183,"height":11}},{"id":"b01d5554-5aa8-410a-9329-1d2a4c0650a1","block_type":"box","text":"A Fund may buy stock of the target company in an announced merger transaction prior","page_number":94,"box":{"x":291,"y":143,"width":616,"height":11}},{"id":"d93e6c10-b87c-4580-982d-285bc3557966","block_type":"box","text":"to the consummation of such transaction. In that circumstance, a Fund would expect to receive an amount (whether","page_number":94,"box":{"x":68,"y":158,"width":827,"height":11}},{"id":"254e1da5-6213-48c3-ab72-561bcd13c9b9","block_type":"box","text":"in cash, stock of the acquiring company or a combination of both) in excess of the purchase price paid by the Fund","page_number":94,"box":{"x":70,"y":173,"width":816,"height":11}},{"id":"3b8fcbb0-e1fc-40ff-9e4b-7849aed8ec96","block_type":"box","text":"for the target company’s stock. However, a Fund is subject to the risk that the merger transaction may be canceled,","page_number":94,"box":{"x":68,"y":188,"width":825,"height":12}},{"id":"34fb3a7d-81dd-4e8b-ba3e-ed70f717a070","block_type":"box","text":"delayed or restructured, in which case a Fund’s holding of the target company’s stock may not result in any profit for","page_number":94,"box":{"x":69,"y":203,"width":832,"height":12}},{"id":"fee9bedf-033f-432c-b85c-feea484a9188","block_type":"box","text":"the Fund and may lose significant value.","page_number":94,"box":{"x":68,"y":218,"width":286,"height":12}},{"id":"3521708f-1449-44a9-8762-8f44e732ac38","block_type":"box","text":"Money Market Obligations of Domestic Banks, Foreign Banks and Foreign Branches of U.S. Banks.","page_number":94,"box":{"x":102,"y":241,"width":723,"height":11}},{"id":"641a8d4c-d448-4912-8a45-7c77b2ae4ae2","block_type":"box","text":"Cer tain","page_number":94,"box":{"x":831,"y":241,"width":50,"height":9}},{"id":"1cc6a57e-a1e7-41c2-a09e-4f26fb304160","block_type":"box","text":"Funds may purchase bank obligations, such as cer tificates of deposit, notes, bankers’ acceptances and time","page_number":94,"box":{"x":70,"y":256,"width":778,"height":12}},{"id":"e8e97abe-d7de-4979-a8b3-614447a22be0","block_type":"box","text":"deposits, including instruments issued or suppor ted by the credit of U.S. or foreign banks or savings institutions","page_number":94,"box":{"x":69,"y":271,"width":802,"height":12}},{"id":"03da3eb9-abff-48ae-9ec2-0e3c678f0b91","block_type":"box","text":"having total assets at the time of purchase in excess of $1 billion. These obligations may be general obligations of","page_number":94,"box":{"x":69,"y":286,"width":820,"height":12}},{"id":"836d0adf-3fa2-4897-a34b-608375d094a7","block_type":"box","text":"the parent bank or may be limited to the issuing branch or subsidiary by the terms of a specific obligation or by","page_number":94,"box":{"x":68,"y":302,"width":794,"height":11}},{"id":"4dddd98e-38bc-40bb-bfda-b1bf04bb5dd2","block_type":"box","text":"government regulation. The assets of a bank or savings institution will be deemed to include the assets of its","page_number":94,"box":{"x":68,"y":317,"width":781,"height":11}},{"id":"c00904f6-4dc1-418b-9a85-e684a6590aa1","block_type":"box","text":"domestic and foreign branches for purposes of a Fund’s investment policies. Investments in shor t-term bank","page_number":94,"box":{"x":69,"y":332,"width":776,"height":11}},{"id":"8d059616-c7f7-4b16-9887-d093a5067674","block_type":"box","text":"obligations may include obligations of foreign banks and domestic branches of foreign banks, and also foreign","page_number":94,"box":{"x":69,"y":347,"width":785,"height":11}},{"id":"3a45ff40-08bf-45c9-b753-f4b3c2901a83","block_type":"box","text":"branches of domestic banks.","page_number":94,"box":{"x":69,"y":362,"width":205,"height":9}},{"id":"71c1e4ce-6f61-4e95-984c-c6418b730713","block_type":"box","text":"To the extent consistent with their investment objectives, a Fund may invest in debt obligations of domestic or","page_number":94,"box":{"x":101,"y":385,"width":785,"height":11}},{"id":"04eedb14-5345-4708-b3e6-6707bd3d0419","block_type":"box","text":"foreign corporations and banks, and may acquire commercial obligations issued by Canadian corporations and","page_number":94,"box":{"x":68,"y":400,"width":787,"height":11}},{"id":"a6252cfb-f7c0-45d4-8501-1ea5e7b2f245","block_type":"box","text":"Canadian counterpar ts of U.S. corporations, as well as Europaper, which is U.S. dollar-denominated commercial","page_number":94,"box":{"x":69,"y":415,"width":797,"height":11}},{"id":"b45d1b71-70ca-4ae2-8060-15fcdd10bb36","block_type":"box","text":"paper of a foreign issuer.","page_number":94,"box":{"x":70,"y":430,"width":176,"height":11}},{"id":"c0a2b5e5-91d0-4c68-b020-ec3bc8053548","block_type":"box","text":"Money Market Securities.","page_number":94,"box":{"x":102,"y":453,"width":188,"height":11}},{"id":"b9570076-4916-468d-acc6-78a62e31cfad","block_type":"box","text":"Cer tain Funds may invest in a broad range of shor t-term, high quality, U.S. dollar","page_number":94,"box":{"x":296,"y":453,"width":578,"height":11}},{"id":"043f80b3-2667-4921-8d18-6204f712346c","block_type":"box","text":"denominated instruments, such as government, bank, commercial and other obligations that are available in the","page_number":94,"box":{"x":69,"y":468,"width":802,"height":11}},{"id":"8f39d470-5f98-4476-b226-5d5dd19d387e","block_type":"box","text":"money markets. In par ticular, the Funds may invest in:","page_number":94,"box":{"x":69,"y":483,"width":386,"height":11}},{"id":"8684bf65-9517-4f9d-802c-b7744961707c","block_type":"box","text":"(a) U.S. dollar-denominated obligations issued or suppor ted by the credit of U.S. or foreign banks or savings","page_number":94,"box":{"x":69,"y":503,"width":779,"height":12}},{"id":"769100df-67f3-42d5-a1aa-a3b3ac6715ed","block_type":"box","text":"institutions with total assets in excess of $1 billion (including obligations of foreign branches of such banks);","page_number":94,"box":{"x":102,"y":518,"width":776,"height":12}},{"id":"ea6d8ade-89de-4485-9929-d3529ac6abe4","block_type":"box","text":"(b) high quality commercial paper and other obligations issued or guaranteed by U.S. and foreign corporations and","page_number":94,"box":{"x":69,"y":538,"width":821,"height":12}},{"id":"751c7968-2ed6-48a5-b150-8fe55f01213e","block_type":"box","text":"other issuers rated (at the time of purchase) A-2 or higher by S&P, Prime-2 or higher by Moody’s or F-2 or higher","page_number":94,"box":{"x":102,"y":554,"width":795,"height":11}},{"id":"144a2a22-ef16-4fb0-b55b-d2fe8432c82b","block_type":"box","text":"by Fitch, as well as high quality corporate bonds rated (at the time of purchase) A or higher by those rating","page_number":94,"box":{"x":102,"y":569,"width":757,"height":11}},{"id":"9d7a2555-ec2f-41b9-b939-08f1f2c5e826","block_type":"box","text":"agencies;","page_number":94,"box":{"x":102,"y":584,"width":66,"height":11}},{"id":"4ddb2c0f-d4bb-4ee7-a0aa-0f2185ffe48c","block_type":"box","text":"(c) unrated notes, paper and other instruments that are of comparable quality to the instruments described in","page_number":94,"box":{"x":69,"y":604,"width":792,"height":11}},{"id":"0f9c38dd-e9ef-4e2d-87bb-a7dc2de77db4","block_type":"box","text":"(b) above as determined by the Fund’s Manager;","page_number":94,"box":{"x":102,"y":619,"width":344,"height":11}},{"id":"cbd5803e-8dea-4484-8638-1e6d75173347","block_type":"box","text":"(d) asset-backed securities (including interests in pools of assets such as mor tgages, installment purchase","page_number":94,"box":{"x":69,"y":639,"width":776,"height":12}},{"id":"69ac2273-ea41-465e-a439-eeefb2c67082","block_type":"box","text":"obligations and credit card receivables);","page_number":94,"box":{"x":102,"y":655,"width":283,"height":11}},{"id":"92a7ab3f-4719-4a3e-8ece-506292fd2dd1","block_type":"box","text":"(e) securities issued or guaranteed as to principal and interest by the U.S. Government or by its agencies or","page_number":94,"box":{"x":69,"y":675,"width":778,"height":11}},{"id":"86f2ff60-bd9a-44a2-b919-9875207b4515","block_type":"box","text":"authorities and related custodial receipts;","page_number":94,"box":{"x":102,"y":690,"width":296,"height":11}},{"id":"e6ac9e51-6f54-44d9-b483-b9a2e136cb60","block_type":"box","text":"(f) dollar-denominated securities issued or guaranteed by foreign governments or their political subdivisions,","page_number":94,"box":{"x":69,"y":710,"width":782,"height":11}},{"id":"f73d4873-02e7-43f3-b056-d65f0bf9e6be","block_type":"box","text":"agencies or authorities;","page_number":94,"box":{"x":102,"y":725,"width":166,"height":11}},{"id":"97569071-249e-4264-9593-51352c5f9695","block_type":"box","text":"(g) funding agreements issued by highly-rated U.S. insurance companies;","page_number":94,"box":{"x":69,"y":745,"width":528,"height":11}},{"id":"c16c3da7-912a-4b71-91d1-d16a2ead0c2b","block_type":"box","text":"(h) securities issued or guaranteed by state or local governmental bodies;","page_number":94,"box":{"x":69,"y":766,"width":534,"height":11}},{"id":"c440df01-7dbe-40bb-a62f-06687fa97d3e","block_type":"box","text":"(i) repurchase agreements relating to the above instruments;","page_number":94,"box":{"x":69,"y":786,"width":447,"height":11}},{"id":"a3d95811-8d93-4ca1-b52e-7d8f36d825d6","block_type":"box","text":"(j) municipal bonds and notes whose principal and interest payments are guaranteed by the U.S. Government or","page_number":94,"box":{"x":69,"y":806,"width":812,"height":11}},{"id":"f66491a6-e24c-4a09-8191-bfd8c9404a62","block_type":"box","text":"one of its agencies or authorities or which otherwise depend directly or indirectly on the credit of the United","page_number":94,"box":{"x":102,"y":821,"width":766,"height":11}},{"id":"ccb4c1c8-63af-437b-a91f-fa08108a19a2","block_type":"box","text":"States;","page_number":94,"box":{"x":102,"y":836,"width":49,"height":10}},{"id":"b68362a5-14b4-4aa2-b60a-4bbff5f4a200","block_type":"box","text":"(k) fixed and variable rate notes and similar debt instruments rated MIG-2, VMIG-2 or Prime-2 or higher by Moody’s,","page_number":94,"box":{"x":69,"y":856,"width":829,"height":11}},{"id":"807c0a3e-fd8f-4bb2-8a3f-c58e33dbfacf","block_type":"box","text":"SP-2 or A-2 or higher by S&P, or F-2 or higher by Fitch;","page_number":94,"box":{"x":102,"y":871,"width":379,"height":11}},{"id":"c33f8723-d6ad-4844-b37d-569d3917cf38","block_type":"box","text":"(l) tax-exempt commercial paper and similar debt instruments rated Prime-2 or higher by Moody’s, A-2 or higher by","page_number":94,"box":{"x":69,"y":891,"width":826,"height":12}},{"id":"5a1fafd6-5786-472f-ab12-84860bd217cf","block_type":"box","text":"S&P, or F-2 or higher by Fitch;","page_number":94,"box":{"x":102,"y":906,"width":207,"height":12}},{"id":"6a3f770c-f814-4ac2-a2ea-23b63de5f93e","block_type":"box","text":"II-50","page_number":94,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f261e9ce-8c07-4575-86fb-e3559c3a854e","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":94,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"0a466ce0-f07e-45cf-81fe-70800f3fc0ef","block_type":"box","text":"(m) municipal bonds rated A or higher by Moody’s, S&P or Fitch;","page_number":95,"box":{"x":69,"y":45,"width":458,"height":11}},{"id":"0abe57e0-0ef5-4632-948c-9b8e6440d428","block_type":"box","text":"(n) unrated notes, paper or other instruments that are of comparable quality to the instruments described above, as","page_number":95,"box":{"x":69,"y":65,"width":837,"height":11}},{"id":"a49e46c2-a973-4e1b-84bd-b47774a49b6b","block_type":"box","text":"determined by the Fund’s Manager under guidelines established by the Board; and","page_number":95,"box":{"x":101,"y":80,"width":589,"height":11}},{"id":"c475b073-51ea-4949-9a05-500de0be3b23","block_type":"box","text":"(o) municipal bonds and notes which are guaranteed as to principal and interest by the U.S. Government or an","page_number":95,"box":{"x":69,"y":100,"width":795,"height":11}},{"id":"57e6db4f-cde5-455b-a370-4053f5abcaaa","block_type":"box","text":"agency or instrumentality thereof or which otherwise depend directly or indirectly on the credit of the United","page_number":95,"box":{"x":102,"y":115,"width":764,"height":11}},{"id":"5cb631d6-7661-4316-91db-9efd75b0568f","block_type":"box","text":"States.","page_number":95,"box":{"x":102,"y":130,"width":49,"height":9}},{"id":"86f6eef2-44a0-4b02-97a8-8d5105da0af1","block_type":"box","text":"Mortgage-Related Securities.","page_number":95,"box":{"x":102,"y":153,"width":213,"height":11}},{"id":"6fb8e299-9dd5-4935-ab3d-8410fff9fb4e","block_type":"box","text":"Mor tgage-Backed Securities.","page_number":95,"box":{"x":102,"y":176,"width":203,"height":11}},{"id":"856ed10f-67b5-4f59-aae3-64d808310cb7","block_type":"box","text":"Mor tgage-backed securities represent interests in pools of mor tgages in which","page_number":95,"box":{"x":312,"y":176,"width":560,"height":11}},{"id":"1a18029a-f6b8-48e5-a9bb-28011657bfa6","block_type":"box","text":"payments of both principal and interest on the securities are generally made monthly, in effect “passing through”","page_number":95,"box":{"x":70,"y":191,"width":805,"height":11}},{"id":"33a3fde9-2a57-4e08-8bc4-5c03fc86b949","block_type":"box","text":"monthly payments made by borrowers on the residential or commercial mor tgage loans that underlie the securities","page_number":95,"box":{"x":69,"y":206,"width":819,"height":11}},{"id":"bec15ba4-3dd9-4b90-a1b8-9b73b0bd10df","block_type":"box","text":"(net of any fees paid to the issuer or guarantor of the securities). Mor tgage-backed securities differ from other forms","page_number":95,"box":{"x":69,"y":221,"width":832,"height":11}},{"id":"9813db9e-c98a-46ea-ab9b-bf78ec76b076","block_type":"box","text":"of debt securities, which normally provide for periodic payment of interest in fixed amounts with principal payments at","page_number":95,"box":{"x":69,"y":236,"width":838,"height":11}},{"id":"c29037e0-13eb-4431-8bdf-9895b14fc2e2","block_type":"box","text":"maturity or specified call dates.","page_number":95,"box":{"x":69,"y":251,"width":222,"height":11}},{"id":"7bb97f89-3379-4ddd-bee0-b4b82003fb85","block_type":"box","text":"Mor tgage-backed securities are subject to the general risks associated with investing in real estate securities;","page_number":95,"box":{"x":102,"y":274,"width":785,"height":11}},{"id":"73e0cda9-d5ee-474f-808e-ff705b95c689","block_type":"box","text":"that is, they may lose value if the value of the underlying real estate to which a pool of mor tgages relates declines. In","page_number":95,"box":{"x":68,"y":289,"width":838,"height":11}},{"id":"045881e1-c90b-45e5-a6d8-7cbe6a93c782","block_type":"box","text":"addition, investments in mor tgage-backed securities involve cer tain specific risks. These risks include the failure of a","page_number":95,"box":{"x":69,"y":304,"width":836,"height":11}},{"id":"af999f8a-5bcf-4137-8947-65dccf1c0a2b","block_type":"box","text":"par ty to meet its commitments under the related operative documents, adverse interest rate changes and the effects","page_number":95,"box":{"x":70,"y":319,"width":837,"height":12}},{"id":"a194b0e8-8d39-456a-a2ca-6c2f77e025cb","block_type":"box","text":"of prepayments on mor tgage cash flows. Mor tgage-backed securities are “pass-through” securities, meaning that","page_number":95,"box":{"x":69,"y":334,"width":810,"height":12}},{"id":"6e2b7f36-7e69-49fb-a5a9-723ccae77a6d","block_type":"box","text":"principal and interest payments made by the borrower on the underlying mor tgages are passed through to a Fund.","page_number":95,"box":{"x":70,"y":350,"width":811,"height":11}},{"id":"3fc83ea4-190c-4ce6-986d-fc54cde83b14","block_type":"box","text":"Accordingly, the value of mor tgage-backed securities in which a Fund invests may be par ticularly sensitive to changes","page_number":95,"box":{"x":68,"y":365,"width":837,"height":11}},{"id":"bbe1e725-a448-4ce9-a733-44f76856f1f6","block_type":"box","text":"in prevailing interest rates, and, like other fixed income investments, the ability of a Fund to utilize these instruments","page_number":95,"box":{"x":70,"y":380,"width":834,"height":11}},{"id":"6b924c01-2611-42b2-9b0e-108b3faa72ba","block_type":"box","text":"successfully may depend in par t upon the ability of the Manager to forecast interest rates and other economic factors","page_number":95,"box":{"x":69,"y":395,"width":840,"height":11}},{"id":"f8733f26-35d6-40f8-a120-637315187168","block_type":"box","text":"correctly. The value of mor tgage-backed securities, like that of traditional fixed-income securities, typically increases","page_number":95,"box":{"x":69,"y":410,"width":827,"height":11}},{"id":"a0983d90-186e-4609-9e44-da1876df66f0","block_type":"box","text":"when interest rates fall and decreases when interest rates rise. However, mor tgage-backed securities differ from","page_number":95,"box":{"x":68,"y":425,"width":805,"height":11}},{"id":"17976731-15a5-44c9-8741-93fd2089d037","block_type":"box","text":"traditional fixed-income securities because of their potential for prepayment without penalty. The price paid by a Fund","page_number":95,"box":{"x":68,"y":440,"width":834,"height":11}},{"id":"d1288fd8-ccbd-4143-96b4-7a8a5c67412e","block_type":"box","text":"for its mor tgage-backed securities, the yield the Fund expects to receive from such securities and the weighted","page_number":95,"box":{"x":68,"y":455,"width":791,"height":12}},{"id":"e05087b1-fafa-476d-be53-16ca4309a0f4","block_type":"box","text":"average life of the securities are based on a number of factors, including the anticipated rate of prepayment of the","page_number":95,"box":{"x":69,"y":470,"width":816,"height":12}},{"id":"14a36730-a4c8-4cdb-aece-98450b90e565","block_type":"box","text":"underlying mor tgages. In a period of declining interest rates, borrowers may prepay the underlying mor tgages more","page_number":95,"box":{"x":69,"y":486,"width":819,"height":11}},{"id":"8c6faa66-045e-4e85-ab1d-9627839a6f15","block_type":"box","text":"quickly than anticipated, thereby reducing the yield to maturity and the average life of the mor tgage-backed","page_number":95,"box":{"x":69,"y":501,"width":761,"height":11}},{"id":"0196e509-53a9-4e45-8cb5-a7b074457539","block_type":"box","text":"securities. Moreover, when a Fund reinvests the proceeds of a prepayment in these circumstances, it will likely","page_number":95,"box":{"x":69,"y":516,"width":791,"height":11}},{"id":"c5c60d0b-a1fa-43a2-88ab-29cd18c8f5e4","block_type":"box","text":"receive a rate of interest that is lower than the rate on the security that was prepaid.","page_number":95,"box":{"x":69,"y":531,"width":602,"height":11}},{"id":"1bccafe4-642f-4e07-82f2-549fa31f477d","block_type":"box","text":"To the extent that a Fund purchases mor tgage-backed securities at a premium, mor tgage foreclosures and","page_number":95,"box":{"x":101,"y":554,"width":761,"height":11}},{"id":"d1de3303-0052-4d8d-b790-d231ffe27b98","block_type":"box","text":"principal prepayments may result in a loss to the extent of the premium paid. If a Fund buys such securities at a","page_number":95,"box":{"x":70,"y":569,"width":800,"height":11}},{"id":"b96e6737-ba17-470b-a432-7e98c778c5cd","block_type":"box","text":"discount, both scheduled payments of principal and unscheduled prepayments will increase current and total returns","page_number":95,"box":{"x":69,"y":584,"width":833,"height":11}},{"id":"af30a869-9e47-4fd0-a2e6-bf4640d1733c","block_type":"box","text":"and will accelerate the recognition of income, which, when distributed to shareholders, will be taxable as ordinary","page_number":95,"box":{"x":69,"y":599,"width":809,"height":11}},{"id":"7db9fe3e-3869-4d37-92a0-e895a26f5c85","block_type":"box","text":"income. In a period of rising interest rates, prepayments of the underlying mor tgages may occur at a slower than","page_number":95,"box":{"x":70,"y":614,"width":801,"height":11}},{"id":"f243d395-b15a-4191-92c0-d1a4871d3635","block_type":"box","text":"expected rate, creating maturity extension risk. This par ticular risk may effectively change a security that was","page_number":95,"box":{"x":69,"y":629,"width":778,"height":11}},{"id":"1f0a47ce-22ba-408b-8bc1-f9b9a8afd8d5","block_type":"box","text":"considered shor t- or intermediate-term at the time of purchase into a long-term security. Since the value of long-term","page_number":95,"box":{"x":69,"y":644,"width":831,"height":12}},{"id":"61bc434e-6ad8-4b4c-ae48-0d9bafecc7d5","block_type":"box","text":"securities generally fluctuates more widely in response to changes in interest rates than that of shor ter-term","page_number":95,"box":{"x":69,"y":659,"width":773,"height":12}},{"id":"1f5e2316-07c3-4ec6-b6c7-79b9618ef6a1","block_type":"box","text":"securities, maturity extension risk could increase the inherent volatility of the Fund. Under cer tain interest rate and","page_number":95,"box":{"x":69,"y":675,"width":818,"height":11}},{"id":"cbe65c2b-3235-448e-8873-bf2b9f20c489","block_type":"box","text":"prepayment scenarios, a Fund may fail to recoup fully its investment in mor tgage-backed securities notwithstanding","page_number":95,"box":{"x":70,"y":690,"width":822,"height":11}},{"id":"d6c1ac09-8809-4357-9ec4-b1f3e94d5087","block_type":"box","text":"any direct or indirect governmental or agency guarantee.","page_number":95,"box":{"x":69,"y":705,"width":399,"height":11}},{"id":"c12134c1-6906-4e7a-b6bd-7c3eb76985ce","block_type":"box","text":"There are currently three types of mor tgage pass-through securities: (1) those issued by the U.S. Government or","page_number":95,"box":{"x":101,"y":727,"width":802,"height":12}},{"id":"e7cb2e67-e8a2-4e79-8231-fb8f00ff916a","block_type":"box","text":"one of its agencies or instrumentalities, such as the Government National Mor tgage Association (“Ginnie Mae”), the","page_number":95,"box":{"x":69,"y":743,"width":830,"height":11}},{"id":"01a73339-ef4b-4e31-909a-af328c14ec14","block_type":"box","text":"Federal National Mor tgage Association (“Fannie Mae”) and the Federal Home Loan Mor tgage Corporation (“Freddie","page_number":95,"box":{"x":70,"y":758,"width":818,"height":11}},{"id":"353935fc-4955-4ec0-b9eb-615d3721c17a","block_type":"box","text":"Mac”); (2) those issued by private issuers that represent an interest in or are collateralized by pass-through","page_number":95,"box":{"x":70,"y":773,"width":766,"height":11}},{"id":"59ae5cf5-6024-4584-bd31-b19e88e81576","block_type":"box","text":"securities issued or guaranteed by the U.S. Government or one of its agencies or instrumentalities; and (3) those","page_number":95,"box":{"x":69,"y":788,"width":808,"height":11}},{"id":"67f7463b-04a1-4b6b-93a5-9f1328b58279","block_type":"box","text":"issued by private issuers that represent an interest in or are collateralized by whole mor tgage loans or pass-through","page_number":95,"box":{"x":70,"y":803,"width":825,"height":11}},{"id":"a39517ee-9825-4da7-a0ff-f25450f28eda","block_type":"box","text":"securities without a government guarantee but that usually have some form of private credit enhancement.","page_number":95,"box":{"x":69,"y":818,"width":761,"height":11}},{"id":"9e2a79f2-3a09-4d80-b794-4a9dc7a6d3ea","block_type":"box","text":"Ginnie Mae is a wholly owned U.S. Government corporation within the Depar tment of Housing and Urban","page_number":95,"box":{"x":102,"y":841,"width":743,"height":11}},{"id":"508d0a79-7a01-49dc-b132-ff90a4505bb8","block_type":"box","text":"Development. Ginnie Mae is authorized to guarantee, with the full faith and credit of the U.S. Government, the timely","page_number":95,"box":{"x":70,"y":856,"width":831,"height":11}},{"id":"833eaaf0-408e-40d5-ab23-842e8704625f","block_type":"box","text":"payment of principal and interest on securities issued by the institutions approved by Ginnie Mae (such as savings","page_number":95,"box":{"x":70,"y":871,"width":815,"height":11}},{"id":"91a7e509-71bb-477e-9e4e-5aaeae453188","block_type":"box","text":"and loan institutions, commercial banks and mor tgage banks), and backed by pools of Federal Housing","page_number":95,"box":{"x":69,"y":886,"width":737,"height":12}},{"id":"49803852-b488-479b-86a1-8e1e49f76486","block_type":"box","text":"Administration (“FHA”)-insured or Veterans’ Administration (“VA”)-guaranteed mor tgages. Pass-through cer tificates","page_number":95,"box":{"x":68,"y":901,"width":814,"height":12}},{"id":"991f3850-85c3-4b88-a803-a2e7198a36aa","block_type":"box","text":"II-51","page_number":95,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"32612596-338b-4ef2-b748-5a8c19d9c9d9","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":95,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"da8fc5fe-7921-4e74-baf1-095ad3395b0d","block_type":"box","text":"guaranteed by Ginnie Mae (such cer tificates are also known as “Ginnie Maes”) are guaranteed as to the timely","page_number":96,"box":{"x":68,"y":45,"width":794,"height":11}},{"id":"08f39fc9-0728-4b88-a1fb-6726a5cbb573","block_type":"box","text":"payment of principal and interest by Ginnie Mae, whose guarantee is backed by the full faith and credit of the United","page_number":96,"box":{"x":70,"y":60,"width":828,"height":11}},{"id":"7bff88d2-82ac-4921-aa5e-90a3c8f9293f","block_type":"box","text":"States. Ginnie Mae cer tificates also are suppor ted by the authority of Ginnie Mae to borrow funds from the U.S.","page_number":96,"box":{"x":69,"y":75,"width":798,"height":11}},{"id":"252b1f03-0f7b-465d-b641-69aebfeb677b","block_type":"box","text":"Treasury Depar tment to make payments under its guarantee. Mor tgage-related securities issued by Fannie Mae","page_number":96,"box":{"x":68,"y":90,"width":798,"height":11}},{"id":"d1f4d960-ea41-40a1-86b9-dad62309f36c","block_type":"box","text":"include Fannie Mae guaranteed Mor tgage Pass-Through Cer tificates (also known as “Fannie Maes”), which are","page_number":96,"box":{"x":70,"y":105,"width":788,"height":11}},{"id":"7a79974f-51bc-48d7-a20a-80ae9bb24ef6","block_type":"box","text":"guaranteed as to timely payment of principal and interest by Fannie Mae. They are not backed by or entitled to the full","page_number":96,"box":{"x":68,"y":120,"width":840,"height":12}},{"id":"43d03ac5-aa48-4f16-9e13-f2793cae3702","block_type":"box","text":"faith and credit of the United States, but are suppor ted by the right of Fannie Mae to borrow from the U.S. Treasury","page_number":96,"box":{"x":68,"y":135,"width":825,"height":12}},{"id":"c5da8437-0144-4ad9-b2e9-3921158cb0e1","block_type":"box","text":"Depar tment. Fannie Mae was established as a federal agency in 1938 and in 1968 was char tered by Congress as a","page_number":96,"box":{"x":70,"y":150,"width":830,"height":12}},{"id":"8d1e177a-318c-4335-ab64-7c36c420d3c4","block_type":"box","text":"private shareholder-owned company. Mor tgage-related securities issued by Freddie Mac include Freddie Mac","page_number":96,"box":{"x":70,"y":166,"width":770,"height":11}},{"id":"f02295ab-adb6-4a87-b542-706e593b4e34","block_type":"box","text":"Mor tgage Par ticipation Cer tificates (also known as “Freddie Macs” or “PCs”). Freddie Mac is a stockholder-owned","page_number":96,"box":{"x":70,"y":181,"width":812,"height":11}},{"id":"afa78cb6-02b3-44de-b2aa-d559c4b82f2a","block_type":"box","text":"corporation char tered by Congress in 1970. Freddie Macs are not guaranteed by the United States or by any Federal","page_number":96,"box":{"x":69,"y":196,"width":829,"height":11}},{"id":"9a0812f8-dd26-4480-84da-c55f737ab940","block_type":"box","text":"Home Loan Banks and do not constitute a debt or obligation of the United States or of any Federal Home Loan Bank.","page_number":96,"box":{"x":70,"y":211,"width":832,"height":11}},{"id":"5731d868-1ba5-42a6-bc25-72fd6f5eb0fc","block_type":"box","text":"Freddie Macs entitle the holder to timely payment of interest, which is guaranteed by Freddie Mac. Freddie Mac","page_number":96,"box":{"x":70,"y":226,"width":792,"height":11}},{"id":"91e2c673-fdda-4e5b-9a54-a4a18c81af6f","block_type":"box","text":"guarantees either ultimate collection or timely payment of all principal payments on the underlying mor tgage loans.","page_number":96,"box":{"x":68,"y":241,"width":819,"height":11}},{"id":"244b26f3-f5a6-4328-a86d-6c48b41649b9","block_type":"box","text":"While Freddie Mac generally does not guarantee timely payment of principal, Freddie Mac may remit the amount due","page_number":96,"box":{"x":68,"y":256,"width":829,"height":12}},{"id":"37750f7b-66a2-4638-9a7d-d2773bc97937","block_type":"box","text":"on account of its guarantee of ultimate payment of principal at any time after default on an underlying mor tgage, but","page_number":96,"box":{"x":69,"y":271,"width":829,"height":12}},{"id":"84e0100b-39e7-45d6-bde7-2ee966220d62","block_type":"box","text":"in no event later than one year after it becomes payable.","page_number":96,"box":{"x":70,"y":286,"width":401,"height":12}},{"id":"a9688d4d-191e-4b67-9902-4183a332470f","block_type":"box","text":"Private mor tgage pass-through securities are structured similarly to Ginnie Mae, Fannie Mae, and Freddie Mac","page_number":96,"box":{"x":102,"y":309,"width":786,"height":11}},{"id":"7314e70b-b055-4fd8-be49-33a2262bf984","block_type":"box","text":"mor tgage pass-through securities and are issued by originators of and investors in mor tgage loans, including","page_number":96,"box":{"x":69,"y":324,"width":777,"height":12}},{"id":"28d31075-22c9-4138-807b-44754689bb4b","block_type":"box","text":"depository institutions, mor tgage banks, investment banks and special purpose subsidiaries of the foregoing.","page_number":96,"box":{"x":69,"y":339,"width":782,"height":12}},{"id":"ab0eff0e-37aa-454f-946a-d799c61cf888","block_type":"box","text":"Pools created by private mor tgage pass-through issuers generally offer a higher rate of interest than government","page_number":96,"box":{"x":102,"y":362,"width":802,"height":11}},{"id":"e97c77df-e48d-4dc3-8adb-0b7633f6b335","block_type":"box","text":"and government-related pools because there are no direct or indirect government or agency guarantees of payments","page_number":96,"box":{"x":69,"y":377,"width":828,"height":12}},{"id":"a567f1d7-d9f2-4597-9c41-71e2b7b9da88","block_type":"box","text":"in the private pools. However, timely payment of interest and principal of these pools may be suppor ted by various","page_number":96,"box":{"x":70,"y":392,"width":814,"height":12}},{"id":"ae6407e7-7651-4464-b703-b3e219b6d897","block_type":"box","text":"forms of insurance or guarantees, including individual loan, title, pool and hazard insurance and letters of credit. The","page_number":96,"box":{"x":68,"y":407,"width":833,"height":12}},{"id":"a17398e4-0c37-4b86-83d4-39b2d3098f61","block_type":"box","text":"insurance and guarantees are issued by governmental entities, private insurers and the mor tgage poolers. The","page_number":96,"box":{"x":70,"y":423,"width":789,"height":11}},{"id":"60d534af-acf0-4da1-89ea-f1866ea8b4d3","block_type":"box","text":"insurance and guarantees and the creditwor thiness of the issuers thereof will be considered in determining whether","page_number":96,"box":{"x":70,"y":438,"width":827,"height":11}},{"id":"170f7cf1-4025-430e-abff-924f6f55f3a2","block_type":"box","text":"a mor tgage-related security meets a Fund’s investment quality standards. There can be no assurance that the private","page_number":96,"box":{"x":69,"y":453,"width":838,"height":11}},{"id":"00fa27e4-332a-4745-b7ee-afdc0951b834","block_type":"box","text":"insurers or guarantors can meet their obligations under the insurance policies or guarantee arrangements. Private","page_number":96,"box":{"x":70,"y":468,"width":810,"height":11}},{"id":"d9c00f39-2a34-43ee-9049-f238bcb807bb","block_type":"box","text":"mor tgage pass-through securities may be bought without insurance or guarantees if, through an examination of the","page_number":96,"box":{"x":69,"y":483,"width":820,"height":11}},{"id":"75bf160d-edf3-45d7-9e5f-933b6bb21417","block_type":"box","text":"loan experience and practices of the originator/servicers and poolers, the Manager determines that the securities","page_number":96,"box":{"x":70,"y":498,"width":812,"height":11}},{"id":"e2378dce-f21d-41ce-8a2d-1fa54df023e2","block_type":"box","text":"meet a Fund’s quality standards. Any mor tgage-related securities that are issued by private issuers have some","page_number":96,"box":{"x":69,"y":514,"width":790,"height":11}},{"id":"afd47787-51d6-4769-8584-d9c81e39d493","block_type":"box","text":"exposure to subprime loans as well as to the mor tgage and credit markets generally.","page_number":96,"box":{"x":69,"y":529,"width":604,"height":11}},{"id":"9826c879-7986-48db-b7af-00cdef91c7fd","block_type":"box","text":"In addition, mor tgage-related securities that are issued by private issuers are not subject to the underwriting","page_number":96,"box":{"x":102,"y":551,"width":774,"height":11}},{"id":"5d3d6ac7-a3dd-4251-87b9-b83bdadd8a35","block_type":"box","text":"requirements for the underlying mor tgages that are applicable to those mor tgage-related securities that have a","page_number":96,"box":{"x":69,"y":566,"width":791,"height":11}},{"id":"9a60ba62-bd48-4e1a-9488-566a104e5c85","block_type":"box","text":"government or government-sponsored entity guarantee. As a result, the mor tgage loans underlying private mor tgage","page_number":96,"box":{"x":68,"y":582,"width":832,"height":11}},{"id":"45920891-fb73-4495-8c99-9223af4e55c6","block_type":"box","text":"related securities may, and frequently do, have less favorable collateral, credit risk or other underwriting","page_number":96,"box":{"x":69,"y":596,"width":742,"height":12}},{"id":"6322f058-5ef0-4370-a2aa-3f9e99ea4e65","block_type":"box","text":"characteristics than government or government-sponsored mor tgage-related securities and have wider variances in a","page_number":96,"box":{"x":69,"y":612,"width":831,"height":11}},{"id":"33b51eb0-9ae6-4e18-b6d5-887f4985ae43","block_type":"box","text":"number of terms including interest rate, term, size, purpose and borrower characteristics. Privately issued pools more","page_number":96,"box":{"x":69,"y":627,"width":840,"height":11}},{"id":"ec081745-fc71-48b9-95f1-a1831928ba7a","block_type":"box","text":"frequently include second mor tgages, high loan-to-value mor tgages and manufactured housing loans. The coupon","page_number":96,"box":{"x":68,"y":642,"width":809,"height":11}},{"id":"b4c3ca42-f644-402c-b374-662536908b27","block_type":"box","text":"rates and maturities of the underlying mor tgage loans in a private-label mor tgage-related securities pool may vary to","page_number":96,"box":{"x":69,"y":657,"width":828,"height":11}},{"id":"91f8b479-929b-4c58-9da2-566dd6be9d08","block_type":"box","text":"a greater extent than those included in a government guaranteed pool, and the pool may include subprime mor tgage","page_number":96,"box":{"x":69,"y":672,"width":830,"height":11}},{"id":"592ccc46-76ad-42a5-a0ac-5a5b4e598853","block_type":"box","text":"loans. Subprime loans refer to loans made to borrowers with weakened credit histories or with a lower capacity to","page_number":96,"box":{"x":70,"y":687,"width":810,"height":11}},{"id":"36b8fe70-6a39-4bef-9c7f-5288a596b898","block_type":"box","text":"make timely payments on their loans. For these reasons, the loans underlying these securities have had in many","page_number":96,"box":{"x":69,"y":703,"width":804,"height":11}},{"id":"169c3d2e-a169-423c-a20b-f9a341c8980e","block_type":"box","text":"cases higher default rates than those loans that meet government underwriting requirements.","page_number":96,"box":{"x":69,"y":717,"width":669,"height":12}},{"id":"e999003e-2c92-4238-85ec-9bd2c0863af1","block_type":"box","text":"The risk of non-payment is greater for mor tgage-related securities that are backed by mor tgage pools that","page_number":96,"box":{"x":101,"y":740,"width":754,"height":11}},{"id":"55c59e68-1efb-404d-8d3d-83414e653c93","block_type":"box","text":"contain subprime loans, but a level of risk exists for all loans. Market factors adversely affecting mor tgage loan","page_number":96,"box":{"x":69,"y":755,"width":795,"height":11}},{"id":"66effcfc-8851-4f28-8dd2-bba461aef3b6","block_type":"box","text":"repayments may include a general economic turndown, high unemployment, a general slowdown in the real estate","page_number":96,"box":{"x":69,"y":771,"width":812,"height":11}},{"id":"19ab240d-4aac-4969-8e68-7bb4db4a496e","block_type":"box","text":"market, a drop in the market prices of real estate, or an increase in interest rates resulting in higher mor tgage","page_number":96,"box":{"x":69,"y":785,"width":788,"height":12}},{"id":"548fb5c3-3e58-4913-a28d-f8c44dc852b6","block_type":"box","text":"payments by holders of adjustable rate mor tgages.","page_number":96,"box":{"x":70,"y":801,"width":361,"height":11}},{"id":"6c09f494-10ed-48c6-8016-90eea645c9ed","block_type":"box","text":"Privately issued mor tgage-related securities are not traded on an exchange and there may be a limited market","page_number":96,"box":{"x":102,"y":823,"width":784,"height":12}},{"id":"069fcbed-7324-416c-918e-03abca97f3ee","block_type":"box","text":"for the securities, especially when there is a perceived weakness in the mor tgage and real estate market sectors.","page_number":96,"box":{"x":68,"y":838,"width":813,"height":12}},{"id":"104c8519-e327-498b-addd-360db12aee2b","block_type":"box","text":"Without an active trading market, mor tgage-related securities held in a Fund’s por tfolio may be par ticularly difficult to","page_number":96,"box":{"x":68,"y":853,"width":837,"height":12}},{"id":"bb1b522b-521f-407b-b6f0-0ff250713120","block_type":"box","text":"value because of the complexities involved in assessing the value of the underlying mor tgage loans.","page_number":96,"box":{"x":68,"y":869,"width":714,"height":11}},{"id":"0b7f4bad-7b98-4584-b7a5-664e42617774","block_type":"box","text":"Collateralized Mor tgage Obligations (“CMOs”).","page_number":96,"box":{"x":102,"y":891,"width":328,"height":12}},{"id":"a6bf8915-9663-4ef2-8df5-f730ab66334e","block_type":"box","text":"CMOs are debt obligations collateralized by residential or","page_number":96,"box":{"x":437,"y":891,"width":407,"height":12}},{"id":"8d0d92f7-4faa-4acc-9f88-929d71bfde66","block_type":"box","text":"commercial mor tgage loans or residential or commercial mor tgage pass-through securities. Interest and prepaid","page_number":96,"box":{"x":69,"y":907,"width":800,"height":11}},{"id":"6098bcec-e4cb-46e1-ba8b-382367fe6ed9","block_type":"box","text":"II-52","page_number":96,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"53a43a3c-af31-4570-8d0f-152c39189482","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":96,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"2a8132c9-f74f-4064-8beb-bef48b605784","block_type":"box","text":"principal are generally paid monthly. CMOs may be collateralized by whole mor tgage loans or private mor tgage pass","page_number":97,"box":{"x":70,"y":45,"width":827,"height":11}},{"id":"cca3a548-3968-4930-8abc-39ff9d0c0c63","block_type":"box","text":"through securities but are more typically collateralized by por tfolios of mor tgage pass-through securities guaranteed","page_number":97,"box":{"x":68,"y":60,"width":826,"height":11}},{"id":"affdc78a-ac01-42bf-8ad9-e57383dcf2b1","block_type":"box","text":"by Ginnie Mae, Freddie Mac, or Fannie Mae. The issuer of a series of CMOs may elect to be treated as a Real Estate","page_number":97,"box":{"x":69,"y":75,"width":833,"height":11}},{"id":"4d8ff18b-38a2-4435-a662-53ec85cbb2c6","block_type":"box","text":"Mor tgage Investment Conduit (“REMIC”). All future references to CMOs also include REMICs.","page_number":97,"box":{"x":70,"y":90,"width":661,"height":11}},{"id":"59ad2dbb-14cf-42f9-9c8b-1fa3fd39242f","block_type":"box","text":"CMOs are structured into multiple classes, often referred to as a “tranche,” each issued at a specific adjustable","page_number":97,"box":{"x":102,"y":113,"width":803,"height":11}},{"id":"a57ac02f-d5fd-47dd-a4a6-729c7ed81a9f","block_type":"box","text":"or fixed interest rate, and bearing a different stated maturity date and each must be fully retired no later than its final","page_number":97,"box":{"x":69,"y":128,"width":837,"height":11}},{"id":"5c7970b1-a67b-4b7d-808d-5abf1cb7f2f3","block_type":"box","text":"distribution date. Actual maturity and average life will depend upon the prepayment experience of the collateral, which","page_number":97,"box":{"x":69,"y":143,"width":838,"height":11}},{"id":"01c5ba78-82fc-4c56-b85f-be6c9058e46b","block_type":"box","text":"is ordinarily unrelated to the stated maturity date. CMOs often provide for a modified form of call protection through a","page_number":97,"box":{"x":70,"y":158,"width":836,"height":11}},{"id":"c2cd0976-d483-437c-a56b-8feb7df4326c","block_type":"box","text":"de facto breakdown of the underlying pool of mor tgages according to how quickly the loans are repaid. Monthly","page_number":97,"box":{"x":69,"y":173,"width":791,"height":11}},{"id":"4a087654-3e76-4a0a-8f5f-e984dac7fd8f","block_type":"box","text":"payment of principal received from the pool of underlying mor tgages, including prepayments, is first returned to","page_number":97,"box":{"x":70,"y":188,"width":792,"height":12}},{"id":"915078e6-8a95-4176-8e4a-bfb8fb8c994c","block_type":"box","text":"investors holding the shor test maturity class. Investors holding the longer maturity classes usually receive principal","page_number":97,"box":{"x":70,"y":204,"width":820,"height":11}},{"id":"cdbaa660-4698-4e4f-b596-821e22d3fe0f","block_type":"box","text":"only after the first class has been retired. An investor may be par tially protected against a sooner than desired return","page_number":97,"box":{"x":69,"y":218,"width":836,"height":12}},{"id":"39727afb-23f6-44e1-ac5f-207c001aaba0","block_type":"box","text":"of principal because of the sequential payments.","page_number":97,"box":{"x":69,"y":234,"width":346,"height":11}},{"id":"36674712-cada-417a-bc14-986d735c1539","block_type":"box","text":"Cer tain issuers of CMOs are not considered investment companies pursuant to a rule adopted by the","page_number":97,"box":{"x":102,"y":256,"width":723,"height":11}},{"id":"ad0fc966-0b8c-491d-8c2c-91e838f5b76c","block_type":"box","text":"Commission, and a Fund may invest in the securities of such issuers without the limitations imposed by the","page_number":97,"box":{"x":69,"y":271,"width":768,"height":12}},{"id":"70696bd8-c479-4714-a839-2c1072735ca6","block_type":"box","text":"Investment Company Act on investments by a Fund in other investment companies. In addition, in reliance on an","page_number":97,"box":{"x":70,"y":287,"width":800,"height":11}},{"id":"40b26f55-b80b-4592-b001-4a04a8a9dcf5","block_type":"box","text":"earlier Commission interpretation, a Fund’s investments in cer tain other qualifying CMOs, which cannot or do not rely","page_number":97,"box":{"x":69,"y":302,"width":836,"height":11}},{"id":"f3ba2970-1613-4c07-966c-a37759b8ee3b","block_type":"box","text":"on the rule, are also not subject to the limitation of the Investment Company Act on acquiring interests in other","page_number":97,"box":{"x":69,"y":317,"width":793,"height":11}},{"id":"257c1f62-794c-4e5e-85c9-6c9746a5b5f3","block_type":"box","text":"investment companies. In order to be able to rely on the Commission’s interpretation, these CMOs must be","page_number":97,"box":{"x":70,"y":332,"width":767,"height":11}},{"id":"a8c93d1b-8a94-4bb5-8b4c-17812160ec4a","block_type":"box","text":"unmanaged, fixed asset issuers, that: (1) invest primarily in mor tgage-backed securities; (2) do not issue redeemable","page_number":97,"box":{"x":69,"y":347,"width":838,"height":11}},{"id":"b5138c81-fe24-4680-8f83-be295001d616","block_type":"box","text":"securities; (3) operate under general exemptive orders exempting them from all provisions of the Investment","page_number":97,"box":{"x":69,"y":362,"width":773,"height":11}},{"id":"37eedf80-b0c7-4543-b221-8db2ba4d96e1","block_type":"box","text":"Company Act; and (4) are not registered or regulated under the Investment Company Act as investment companies.","page_number":97,"box":{"x":69,"y":377,"width":821,"height":12}},{"id":"4b5f5bfd-1144-4da8-aa1d-513dfd2b374c","block_type":"box","text":"To the extent that a Fund selects CMOs that cannot rely on the rule or do not meet the above requirements, the Fund","page_number":97,"box":{"x":68,"y":392,"width":836,"height":12}},{"id":"65988e2e-9322-48cc-8135-24b0011a43f1","block_type":"box","text":"may not invest more than 10% of its assets in all such entities and may not acquire more than 3% of the voting","page_number":97,"box":{"x":69,"y":407,"width":795,"height":12}},{"id":"7e424ae1-f936-405f-bb62-9eb71d4f2455","block_type":"box","text":"securities of any single such entity.","page_number":97,"box":{"x":69,"y":423,"width":248,"height":11}},{"id":"ed4e8d6a-545e-4c95-ba22-1e01af090c1a","block_type":"box","text":"A Fund may also invest in, among other things, parallel pay CMOs, sequential pay CMOs, and floating rate CMOs.","page_number":97,"box":{"x":101,"y":445,"width":807,"height":12}},{"id":"d1d1125b-dc31-419b-85a8-933a510cd5ce","block_type":"box","text":"Parallel pay CMOs are structured to provide payments of principal on each payment date to more than one class,","page_number":97,"box":{"x":69,"y":460,"width":805,"height":12}},{"id":"dfbb8d20-7ee6-4b26-a932-c9023d0353a7","block_type":"box","text":"concurrently on a propor tionate or dispropor tionate basis. These simultaneous payments are taken into account in","page_number":97,"box":{"x":69,"y":476,"width":819,"height":11}},{"id":"8679ec08-6986-4a69-826a-cf710d23ded6","block_type":"box","text":"calculating the final distribution date of each class. Sequential pay CMOs generally pay principal to only one class at","page_number":97,"box":{"x":69,"y":491,"width":829,"height":11}},{"id":"c89bf47e-3146-4147-a7d5-ed499c9fb505","block_type":"box","text":"a time while paying interest to several classes. A wide variety of REMIC Cer tificates may be issued in the parallel pay","page_number":97,"box":{"x":69,"y":506,"width":835,"height":11}},{"id":"62e16443-702a-43b7-b8ef-c686c8801ef3","block_type":"box","text":"or sequential pay structures. These securities include accrual cer tificates (also known as “Z-Bonds”), which only","page_number":97,"box":{"x":69,"y":521,"width":802,"height":11}},{"id":"c75d0550-a4a9-4ac8-a444-7dfdd17eb495","block_type":"box","text":"accrue interest at a specified rate until all other cer tificates having an earlier final distribution date have been retired","page_number":97,"box":{"x":69,"y":536,"width":833,"height":11}},{"id":"3b7f9962-92f4-4f5d-984d-886ceb5c4265","block_type":"box","text":"and are conver ted thereafter to an interest-paying security. Floating rate CMOs are securities whose coupon rate","page_number":97,"box":{"x":69,"y":551,"width":801,"height":11}},{"id":"88943afc-a04a-475c-9b66-ed53fb053f2a","block_type":"box","text":"fluctuates according to some formula related to an existing market index or rate. Typical indices would include the","page_number":97,"box":{"x":68,"y":566,"width":813,"height":11}},{"id":"3219f5dd-7505-44cf-9489-4fdd54b6b55e","block_type":"box","text":"eleventh district cost-of-funds index (“COFI”), one-year Treasury yields, and ten-year Treasury yields.","page_number":97,"box":{"x":69,"y":581,"width":708,"height":11}},{"id":"e91936cd-b3f5-46e5-a5f4-5ef5d30a00c5","block_type":"box","text":"Classes of CMOs also include planned amor tization classes (“PACs”) and targeted amor tization classes","page_number":97,"box":{"x":102,"y":604,"width":742,"height":11}},{"id":"54b8f055-f4c7-49f5-a6b5-21c526be2a84","block_type":"box","text":"(“TACs”). PAC bonds generally require payments of a specified amount of principal on each payment date. The","page_number":97,"box":{"x":69,"y":619,"width":784,"height":11}},{"id":"4e7bfdbc-4232-4a56-90a3-9e406478963a","block_type":"box","text":"scheduled principal payments for PAC Cer tificates generally have the highest priority on each payment date after","page_number":97,"box":{"x":69,"y":634,"width":800,"height":12}},{"id":"0e015df0-d087-4eeb-b5a0-f867c4a6bdc0","block_type":"box","text":"interest due has been paid to all classes entitled to receive interest currently. Shor tfalls, if any, are added to the","page_number":97,"box":{"x":70,"y":649,"width":802,"height":12}},{"id":"88028e14-e7c7-4b2c-a861-02082feda341","block_type":"box","text":"amount payable on the next payment date. The PAC Cer tificate payment schedule is taken into account in calculating","page_number":97,"box":{"x":69,"y":664,"width":834,"height":12}},{"id":"45610aaf-367b-413e-9831-672e9fa723ef","block_type":"box","text":"the final distribution date of each class of PAC. In order to create PAC tranches, one or more tranches generally must","page_number":97,"box":{"x":68,"y":680,"width":835,"height":11}},{"id":"6f8b9d13-5c80-4011-b133-f3cd6b4749a0","block_type":"box","text":"be created that absorb most of the volatility in the underlying mor tgage assets. These tranches (often called","page_number":97,"box":{"x":69,"y":695,"width":772,"height":11}},{"id":"cfee10d7-5b00-4d3b-a59f-6ac16f337dbe","block_type":"box","text":"“suppor ts” or “companion” tranches) tend to have market prices and yields that are more volatile than the PAC","page_number":97,"box":{"x":70,"y":710,"width":792,"height":11}},{"id":"97afbce5-6d5d-43d2-9da6-f19e89901353","block_type":"box","text":"classes.","page_number":97,"box":{"x":69,"y":725,"width":57,"height":9}},{"id":"45a576a6-824f-4355-9d60-ee68d2360d22","block_type":"box","text":"TACs are similar to PACs in that they require that specified amounts of principal be applied on each payment","page_number":97,"box":{"x":101,"y":748,"width":774,"height":11}},{"id":"038220d3-7099-49f1-9d8c-14b3722a7d71","block_type":"box","text":"date to one or more classes of REMIC Cer tificates. A PAC’s payment schedule, however, remains in effect as long as","page_number":97,"box":{"x":69,"y":763,"width":835,"height":11}},{"id":"e616014b-3e95-44a2-9461-f7dbdf211c88","block_type":"box","text":"prepayment rates on the underlying mor tgages do not exceed cer tain ranges. In contrast, a TAC provides investors","page_number":97,"box":{"x":70,"y":778,"width":815,"height":11}},{"id":"00f2ba67-4080-4214-b159-bafa1ebc3728","block_type":"box","text":"with protection, to a cer tain level, against either faster than expected or slower than expected prepayment rates, but","page_number":97,"box":{"x":68,"y":793,"width":833,"height":11}},{"id":"6ba5f820-f164-4df1-aa40-27d66eaf5e49","block_type":"box","text":"not both. TACs thus provide more cash flow stability than a regular sequential paying class, but less than a PAC. TACs","page_number":97,"box":{"x":69,"y":808,"width":839,"height":11}},{"id":"90f92d7d-104a-4a82-a1a7-ac646b551147","block_type":"box","text":"also tend to have market prices and yields that are more volatile than PACs.","page_number":97,"box":{"x":69,"y":823,"width":541,"height":11}},{"id":"e9045b47-fd27-4e0d-8e56-0bde6f07d9d2","block_type":"box","text":"Adjustable Rate Mor tgage Securities.","page_number":97,"box":{"x":101,"y":846,"width":265,"height":11}},{"id":"8d8a2f5d-9fe2-47b9-b371-9311d98ad54f","block_type":"box","text":"Adjustable rate mor tgage securities (“ARMs”) are pass-through securities","page_number":97,"box":{"x":372,"y":846,"width":523,"height":11}},{"id":"84f82f62-1767-4875-a632-1f2d8b85c7b7","block_type":"box","text":"collateralized by mor tgages with adjustable rather than fixed rates. ARMs eligible for inclusion in a mor tgage pool","page_number":97,"box":{"x":69,"y":861,"width":807,"height":11}},{"id":"a1408491-b466-43c5-aaa8-17932cffd256","block_type":"box","text":"generally provide for a fixed initial mor tgage interest rate for a set number of scheduled monthly payments. After that","page_number":97,"box":{"x":68,"y":876,"width":835,"height":11}},{"id":"a54c9999-2853-426e-8cc2-ca4d3d928fff","block_type":"box","text":"schedule of payments has been completed, the interest rates are subject to periodic adjustment based on changes","page_number":97,"box":{"x":69,"y":891,"width":824,"height":12}},{"id":"a1d87f8e-500c-4abf-a5c9-69e7c361a3c4","block_type":"box","text":"to a designated benchmark index.","page_number":97,"box":{"x":68,"y":907,"width":241,"height":11}},{"id":"ddb9f251-d9e0-4b40-8c56-0032e62b0cd0","block_type":"box","text":"II-53","page_number":97,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"c68a0c45-9dbc-4516-9174-4cfdcbabb8c7","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":97,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"7d8738ee-5a31-4960-a01e-0e8dc91a7d08","block_type":"box","text":"ARMs contain maximum and minimum rates beyond which the mor tgage interest rate may not vary over the","page_number":98,"box":{"x":101,"y":45,"width":767,"height":11}},{"id":"2615a203-595e-458a-8c1d-41c976a1ee6b","block_type":"box","text":"lifetime of the security. In addition, cer tain ARMs provide for additional limitations on the maximum amount by which","page_number":98,"box":{"x":70,"y":60,"width":828,"height":11}},{"id":"e691eebc-1d1a-481e-9713-fbee674cead6","block_type":"box","text":"the mor tgage interest rate may adjust for any single adjustment period. In the event that market rates of interest rise","page_number":98,"box":{"x":68,"y":75,"width":837,"height":11}},{"id":"5fa31ca4-34b6-49f0-80d1-05c1dd8ef94c","block_type":"box","text":"more rapidly to levels above that of the ARM’s maximum rate, the ARM’s coupon may represent a below market rate","page_number":98,"box":{"x":69,"y":90,"width":830,"height":11}},{"id":"2a19c884-76a2-46d0-b3ca-50826715c036","block_type":"box","text":"of interest. In these circumstances, the market value of the ARM security will likely have fallen.","page_number":98,"box":{"x":69,"y":105,"width":676,"height":11}},{"id":"457557a8-66f9-4222-baf9-55e06edb89ea","block_type":"box","text":"Cer tain ARMs contain limitations on changes in the required monthly payment. In the event that a monthly","page_number":98,"box":{"x":102,"y":128,"width":757,"height":11}},{"id":"515f8ca6-a749-40a9-bb17-68596cfae84e","block_type":"box","text":"payment is not sufficient to pay the interest accruing on an ARM, any such excess interest is added to the principal","page_number":98,"box":{"x":70,"y":143,"width":822,"height":11}},{"id":"a1fe735e-b4be-4d2e-914d-6fc86eb4d380","block_type":"box","text":"balance of the mor tgage loan, which is repaid through future monthly payments. If the monthly payment for such an","page_number":98,"box":{"x":69,"y":158,"width":823,"height":11}},{"id":"7219c686-4393-4fdb-927a-908f0b651265","block_type":"box","text":"instrument exceeds the sum of the interest accrued at the applicable mor tgage interest rate and the principal","page_number":98,"box":{"x":70,"y":173,"width":782,"height":11}},{"id":"157ef74c-9a48-4ecd-aa38-7a06dc96403b","block_type":"box","text":"payment required at such point to amor tize the outstanding principal balance over the remaining term of the loan, the","page_number":98,"box":{"x":70,"y":188,"width":838,"height":12}},{"id":"0ce56335-1ce2-482b-bc99-da16a3d545d2","block_type":"box","text":"excess is then used to reduce the outstanding principal balance of the ARM.","page_number":98,"box":{"x":69,"y":203,"width":544,"height":12}},{"id":"5fe5af8e-507a-4c4e-9f21-93c58a80c37c","block_type":"box","text":"CMO Residuals.","page_number":98,"box":{"x":102,"y":226,"width":112,"height":9}},{"id":"72cadff3-a0e7-4940-9b95-c51663f1fc9c","block_type":"box","text":"CMO residuals are derivative mor tgage securities issued by agencies or instrumentalities of the","page_number":98,"box":{"x":221,"y":226,"width":682,"height":11}},{"id":"3079ceda-31db-4761-9c64-64c7e8e53fd1","block_type":"box","text":"U.S. Government or by private originators of, or investors in, mor tgage loans, including savings and loan","page_number":98,"box":{"x":70,"y":241,"width":740,"height":11}},{"id":"ad710102-2a86-46f6-be9d-d27c0c8e5d48","block_type":"box","text":"associations, homebuilders, mor tgage banks, commercial banks, investment banks, and special purpose entities of","page_number":98,"box":{"x":69,"y":256,"width":829,"height":12}},{"id":"4031646a-1e37-4b07-ae74-0203e7b08f14","block_type":"box","text":"the foregoing. The cash flow generated by the mor tgage assets underlying a series of CMOs is applied first to make","page_number":98,"box":{"x":68,"y":271,"width":826,"height":12}},{"id":"4cb8eeb3-fb4d-4294-bc09-8caa2c866d67","block_type":"box","text":"required payments of principal and interest on the CMOs and second to pay the related administrative expenses and","page_number":98,"box":{"x":69,"y":286,"width":831,"height":12}},{"id":"1093969d-5c32-44a7-87e9-56c9ea3c591e","block_type":"box","text":"any management fees of the issuer. The residual in a CMO structure generally represents the interest in any excess","page_number":98,"box":{"x":69,"y":302,"width":827,"height":11}},{"id":"1d872345-6be3-412d-881d-c801af822cbb","block_type":"box","text":"cash flow remaining after making the foregoing payments. Each payment of such excess cash flow to a holder of the","page_number":98,"box":{"x":69,"y":317,"width":829,"height":11}},{"id":"0b2153ee-5514-4262-8fe2-4481c655ffdf","block_type":"box","text":"related CMO residual represents income and/or a return of capital. The amount of residual cash flow resulting from a","page_number":98,"box":{"x":69,"y":332,"width":838,"height":11}},{"id":"edd57f30-5b27-4e66-91fe-23f8fd96dae0","block_type":"box","text":"CMO will depend on, among other things, the characteristics of the mor tgage assets, the coupon rate of each class","page_number":98,"box":{"x":69,"y":347,"width":825,"height":11}},{"id":"2d65241e-0fbf-4502-bb61-a3d7797509db","block_type":"box","text":"of CMO, prevailing interest rates, the amount of administrative expenses and the prepayment experience on the","page_number":98,"box":{"x":69,"y":362,"width":798,"height":11}},{"id":"5bf471c9-4794-4919-abde-90103b6452f1","block_type":"box","text":"mor tgage assets. In par t, the yield to maturity on the CMO residuals is extremely sensitive to prepayments on the","page_number":98,"box":{"x":69,"y":377,"width":813,"height":12}},{"id":"c87bf751-3e87-4046-87e0-7567b7fcdcce","block_type":"box","text":"related underlying mor tgage assets, in the same manner as an interest-only class of stripped mor tgage-related","page_number":98,"box":{"x":69,"y":392,"width":790,"height":12}},{"id":"ae3f4455-d1ea-4cdc-ab38-e80a1f338540","block_type":"box","text":"securities. In addition, if a series of a CMO includes a class that bears interest at an adjustable rate, the yield to","page_number":98,"box":{"x":69,"y":407,"width":805,"height":12}},{"id":"f1186595-7b1a-459d-9a2e-475476d2f2d8","block_type":"box","text":"maturity on the related CMO residual will also be extremely sensitive to changes in the level of the index upon which","page_number":98,"box":{"x":69,"y":423,"width":828,"height":11}},{"id":"24715558-77de-418e-abc5-5cced8567f1b","block_type":"box","text":"interest rate adjustments are based. In cer tain circumstances, a Fund may fail to recoup fully its initial investment in","page_number":98,"box":{"x":70,"y":438,"width":831,"height":11}},{"id":"2f890beb-616c-4b5b-b4ce-5fc97bd62536","block_type":"box","text":"a CMO residual.","page_number":98,"box":{"x":69,"y":453,"width":112,"height":9}},{"id":"6fbc1b98-0261-4ad2-9b31-807b0c3dccfd","block_type":"box","text":"CMO residuals are generally purchased and sold by institutional investors through one or more investment","page_number":98,"box":{"x":102,"y":476,"width":758,"height":11}},{"id":"ead00759-2fdb-4f72-95fd-01873ae39e44","block_type":"box","text":"banking firms acting as brokers or dealers. Transactions in CMO residuals are generally completed only after careful","page_number":98,"box":{"x":69,"y":491,"width":827,"height":11}},{"id":"6a771b18-1974-44ea-b27b-17a8766b5bea","block_type":"box","text":"review of the characteristics of the securities in question. In addition, CMO residuals may or, pursuant to an","page_number":98,"box":{"x":69,"y":506,"width":769,"height":11}},{"id":"3330a364-2896-4065-9758-9296da4e2555","block_type":"box","text":"exemption therefrom, may not have been registered under the Securities Act. Residual interests generally are junior","page_number":98,"box":{"x":69,"y":521,"width":825,"height":11}},{"id":"99e49c9f-9832-46aa-b105-e2c699bbf4c9","block_type":"box","text":"to, and may be significantly more volatile than, “regular” CMO and REMIC interests. CMO residuals, whether or not","page_number":98,"box":{"x":68,"y":536,"width":820,"height":11}},{"id":"0a0c4d32-e626-4c2d-94f3-22482689003b","block_type":"box","text":"registered under the Securities Act, may be subject to cer tain restrictions on transferability.","page_number":98,"box":{"x":69,"y":551,"width":650,"height":11}},{"id":"0adcfe4a-270b-4601-ba4e-0a954c654580","block_type":"box","text":"Stripped Mor tgage-Backed Securities.","page_number":98,"box":{"x":102,"y":574,"width":267,"height":11}},{"id":"2f8f7913-bdaa-4b7d-be08-eb60332b9a50","block_type":"box","text":"A Fund may invest in stripped mor tgage-backed securities (“SMBSs”)","page_number":98,"box":{"x":375,"y":574,"width":493,"height":11}},{"id":"39c4b117-ccff-417e-8849-0f2174b3002a","block_type":"box","text":"issued by agencies or instrumentalities of the United States. SMBSs are derivative multi-class mor tgage-backed","page_number":98,"box":{"x":70,"y":589,"width":798,"height":11}},{"id":"36a58f42-cb89-4b50-930f-f03857d51bef","block_type":"box","text":"securities. SMBS arrangements commonly involve two classes of securities that receive different propor tions of the","page_number":98,"box":{"x":69,"y":604,"width":826,"height":11}},{"id":"f05aa7ee-523b-460f-83ae-327194a9180c","block_type":"box","text":"interest and principal distributions on a pool of mor tgage assets. A common variety of SMBS is where one class (the","page_number":98,"box":{"x":70,"y":619,"width":832,"height":11}},{"id":"f05cf213-550d-4f25-977b-76730fb03f9f","block_type":"box","text":"principal only or PO class) receives some of the interest and most of the principal from the underlying assets, while","page_number":98,"box":{"x":70,"y":634,"width":821,"height":12}},{"id":"8b60342f-efb2-41e9-915a-fd804c1ebfc0","block_type":"box","text":"the other class (the interest only or IO class) receives most of the interest and the remainder of the principal. In the","page_number":98,"box":{"x":68,"y":649,"width":826,"height":12}},{"id":"1124e327-eeca-4b24-8c3c-e1d9a3740d43","block_type":"box","text":"most extreme case, the IO class receives all of the interest, while the PO class receives all of the principal. While a","page_number":98,"box":{"x":69,"y":664,"width":822,"height":11}},{"id":"e92db416-d4cc-4db4-85ac-70847aa99406","block_type":"box","text":"Fund may purchase securities of a PO class, a Fund is more likely to purchase the securities of an IO class. The yield","page_number":98,"box":{"x":70,"y":680,"width":834,"height":11}},{"id":"8af914c8-6661-45a2-8fe4-c75296593c56","block_type":"box","text":"to maturity of an IO class is extremely sensitive to the rate of principal payments (including prepayments) on the","page_number":98,"box":{"x":68,"y":695,"width":800,"height":11}},{"id":"8ec09144-7f03-4849-a96c-79ab4c2b19aa","block_type":"box","text":"related underlying assets, and a rapid rate of principal prepayments in excess of that considered in pricing the","page_number":98,"box":{"x":69,"y":710,"width":786,"height":11}},{"id":"ed21ad89-4d8e-4b66-bb61-b51e1c7bc5e4","block_type":"box","text":"securities will have a material adverse effect on an IO security’s yield to maturity. If the underlying mor tgage assets","page_number":98,"box":{"x":69,"y":725,"width":823,"height":11}},{"id":"9a75b2e2-2f03-4830-92ed-639a83c97c3c","block_type":"box","text":"experience greater than anticipated payments of principal, a Fund may fail to recoup fully its initial investment in IOs.","page_number":98,"box":{"x":69,"y":740,"width":832,"height":11}},{"id":"fa1f72c9-b96f-427b-8b1f-832e8d17ebd7","block_type":"box","text":"In addition, there are cer tain types of IOs that represent the interest por tion of a par ticular class as opposed to the","page_number":98,"box":{"x":70,"y":755,"width":824,"height":11}},{"id":"9ef871a5-d75b-4a80-ba4c-fa8f05eba57a","block_type":"box","text":"interest por tion of the entire pool. The sensitivity of this type of IO to interest rate fluctuations may be increased","page_number":98,"box":{"x":70,"y":770,"width":800,"height":11}},{"id":"8f775f33-3a9d-4f84-8c59-4424b269415e","block_type":"box","text":"because of the characteristics of the principal por tion to which they relate. As a result of the above factors, a Fund","page_number":98,"box":{"x":69,"y":785,"width":818,"height":12}},{"id":"1b9646b1-c61e-41f9-afce-04d43d4b03b6","block_type":"box","text":"generally will purchase IOs only as a component of so called “synthetic” securities. This means that purchases of IOs","page_number":98,"box":{"x":68,"y":801,"width":840,"height":11}},{"id":"119bb4ee-d839-4a2a-9eaa-d88bfad60599","block_type":"box","text":"will be matched with cer tain purchases of other securities, such as POs, inverse floating rate CMOs or fixed rate","page_number":98,"box":{"x":68,"y":816,"width":802,"height":11}},{"id":"023a6825-8214-46a2-97b5-46271fd9be2b","block_type":"box","text":"securities; as interest rates fall, presenting a greater risk of unanticipated prepayments of principal, the negative","page_number":98,"box":{"x":69,"y":831,"width":805,"height":11}},{"id":"10af2004-5c3e-4f14-adae-876010bf2f39","block_type":"box","text":"effect on a Fund because of its holdings of IOs should be diminished somewhat because of the increased yield on","page_number":98,"box":{"x":69,"y":846,"width":814,"height":11}},{"id":"3f7283d7-859c-42b0-94a7-74839c92002f","block_type":"box","text":"the inverse floating rate CMOs or the increased appreciation on the POs or fixed rate securities.","page_number":98,"box":{"x":68,"y":861,"width":683,"height":11}},{"id":"d601e1c8-0a0f-4d4f-aa66-eb37d498e902","block_type":"box","text":"Tiered Index Bonds.","page_number":98,"box":{"x":103,"y":884,"width":138,"height":9}},{"id":"fdf794d8-7697-41d7-a7d8-7d07d9986897","block_type":"box","text":"Tiered index bonds are forms of mor tgage-related securities. The interest rate on a tiered","page_number":98,"box":{"x":247,"y":884,"width":638,"height":11}},{"id":"c94bbeac-742f-44c7-95c8-71a58e4fe5c7","block_type":"box","text":"index bond is tied to a specified index or market rate. So long as this index or market rate is below a predetermined","page_number":98,"box":{"x":70,"y":899,"width":825,"height":11}},{"id":"a9569cd4-37e1-417c-bfa5-19264937c631","block_type":"box","text":"II-54","page_number":98,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"24422b24-7e55-4fa6-a1f7-d0b19ccbe6ee","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":98,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"003f11ab-7d5a-47e1-aefd-6f11b12d5a8f","block_type":"box","text":"“strike” rate, the interest rate on the tiered index bond remains fixed. If, however, the specified index or market rate","page_number":99,"box":{"x":70,"y":45,"width":827,"height":11}},{"id":"3dbd9290-89fa-4c52-9c88-fdb6e7f3866d","block_type":"box","text":"rises above the “strike” rate, the interest rate of the tiered index bond will decrease. Thus, under these","page_number":99,"box":{"x":69,"y":60,"width":738,"height":10}},{"id":"12e11904-8c58-4b47-8f00-6d2a67643c82","block_type":"box","text":"circumstances, the interest rate on a tiered index bond, like an inverse floater, will move in the opposite direction of","page_number":99,"box":{"x":69,"y":75,"width":828,"height":11}},{"id":"2dd0627f-1278-4657-915c-5b4a82950ec8","block_type":"box","text":"prevailing interest rates, with the result that the price of the tiered index bond may be considerably more volatile than","page_number":99,"box":{"x":70,"y":90,"width":836,"height":11}},{"id":"cd86bb06-1515-4d43-a694-8f9327af3010","block_type":"box","text":"that of a fixed-rate bond.","page_number":99,"box":{"x":68,"y":105,"width":174,"height":9}},{"id":"07cecc14-f8ed-4429-924f-8e08a98e304a","block_type":"box","text":"TBA Commitments.","page_number":99,"box":{"x":103,"y":128,"width":133,"height":9}},{"id":"8039ea72-9ad6-43bc-964b-40f7be765cbb","block_type":"box","text":"Cer tain Funds may enter into “to be announced” or “TBA” commitments. TBA commitments","page_number":99,"box":{"x":243,"y":128,"width":653,"height":11}},{"id":"abd2660c-49e7-4029-a320-687b070e5734","block_type":"box","text":"are forward agreements for the purchase or sale of securities, including mor tgage-backed securities for a fixed price,","page_number":99,"box":{"x":69,"y":143,"width":834,"height":11}},{"id":"3a53a899-e618-4197-b12e-a3e326c83175","block_type":"box","text":"with payment and delivery on an agreed upon future settlement date. The specific securities to be delivered are not","page_number":99,"box":{"x":68,"y":158,"width":825,"height":11}},{"id":"89c5f879-2880-47e2-b33d-a59d34bc524a","block_type":"box","text":"identified at the trade date. However, delivered securities must meet specified terms, including issuer, rate and","page_number":99,"box":{"x":70,"y":173,"width":793,"height":11}},{"id":"e22ed0af-6ada-4c50-9ddc-755590c870e2","block_type":"box","text":"mor tgage terms. When the Fund enters into a TBA commitment for the sale of mor tgage-backed securities for a fixed","page_number":99,"box":{"x":69,"y":188,"width":833,"height":12}},{"id":"d6daa76b-7ca5-4b4b-ada2-54cd60d3939c","block_type":"box","text":"price, with payment and delivery on an agreed upon future settlement date (which may be referred to as having a","page_number":99,"box":{"x":70,"y":203,"width":804,"height":12}},{"id":"4fae3031-d7a2-425e-b7a7-64512f8304d6","block_type":"box","text":"shor t position in such TBA securities), the Fund may or may not hold the types of mor tgage-backed securities","page_number":99,"box":{"x":69,"y":218,"width":779,"height":12}},{"id":"dc9df968-35fe-48d9-88d5-4bfeb9679234","block_type":"box","text":"required to be delivered. See “—When-Issued Securities, Delayed Delivery Securities and Forward Commitments”","page_number":99,"box":{"x":69,"y":234,"width":810,"height":11}},{"id":"bebe99ac-0854-438c-acb9-8ced621cbb46","block_type":"box","text":"below.","page_number":99,"box":{"x":69,"y":249,"width":43,"height":9}},{"id":"82847363-d022-4c5b-8a8c-b4210e38f220","block_type":"box","text":"Mor tgage Dollar Rolls.","page_number":99,"box":{"x":102,"y":272,"width":157,"height":11}},{"id":"933d8370-608b-42bb-b972-870dc8769d83","block_type":"box","text":"Cer tain Funds may invest in mor tgage dollar rolls. In a mor tgage dollar roll transaction, a","page_number":99,"box":{"x":266,"y":272,"width":634,"height":11}},{"id":"bbabe189-0f36-4407-8a6b-79bab9889a8b","block_type":"box","text":"Fund sells mor tgage-backed securities for delivery in the current month and simultaneously contracts to repurchase","page_number":99,"box":{"x":70,"y":286,"width":825,"height":12}},{"id":"fbc63b1e-f440-4f8b-b1a8-3403a2f547fb","block_type":"box","text":"substantially similar securities on a specified future date. The securities that are repurchased will bear the same","page_number":99,"box":{"x":69,"y":302,"width":805,"height":11}},{"id":"d20dfb07-5b48-453c-9ed1-cf99981ca512","block_type":"box","text":"interest rate and a similar maturity as those sold, but pools of mor tgages collateralizing those securities may have","page_number":99,"box":{"x":70,"y":317,"width":817,"height":11}},{"id":"5f145c28-2434-43d7-a091-af869c1c892e","block_type":"box","text":"different prepayment histories than those sold. During the period between the sale and repurchase, a Fund will not","page_number":99,"box":{"x":69,"y":332,"width":820,"height":11}},{"id":"7ba634b6-306b-4f79-bb1f-f0cc61840e75","block_type":"box","text":"be entitled to receive interest and principal payments on the securities sold. Proceeds of the sale will be invested in","page_number":99,"box":{"x":69,"y":347,"width":827,"height":11}},{"id":"51a585fd-2e81-46a4-9c8d-9322f846892f","block_type":"box","text":"additional instruments for the Fund, and the income from these investments will generate income for the Fund. If","page_number":99,"box":{"x":69,"y":362,"width":806,"height":11}},{"id":"6b582db9-323d-41df-a2a4-3bd205c8090b","block_type":"box","text":"such income does not exceed the income, capital appreciation and gain or loss that would have been realized on the","page_number":99,"box":{"x":69,"y":377,"width":833,"height":12}},{"id":"42f608fe-6429-4c38-b12b-65b798f77a14","block_type":"box","text":"securities sold as par t of the dollar roll, the use of this technique will diminish the investment per formance of a Fund","page_number":99,"box":{"x":69,"y":392,"width":836,"height":11}},{"id":"c0b86b65-08ff-48b9-b7ad-5298558d46c7","block_type":"box","text":"compared with what the per formance would have been without the use of dollar rolls.","page_number":99,"box":{"x":69,"y":407,"width":607,"height":11}},{"id":"64b217d3-4eb3-4f45-87d3-0cf8c3e80018","block_type":"box","text":"Each mor tgage dollar roll transaction is accounted for as a sale or purchase of a por tfolio security and a","page_number":99,"box":{"x":102,"y":430,"width":744,"height":11}},{"id":"7eb41c0d-820e-4780-a13e-ea72f3f04ae8","block_type":"box","text":"subsequent purchase or sale of a substantially similar security in the forward market. Transactions in mor tgage","page_number":99,"box":{"x":69,"y":445,"width":796,"height":12}},{"id":"2952c719-551d-4e42-8fbe-31cc12664a85","block_type":"box","text":"dollar rolls may increase trading costs and por tfolio turnover.","page_number":99,"box":{"x":69,"y":460,"width":433,"height":12}},{"id":"84846f4e-7ef1-43b9-acce-12cb191dc1e3","block_type":"box","text":"In the event the buyer of the securities under a mor tgage dollar roll files for bankruptcy or becomes insolvent, a","page_number":99,"box":{"x":102,"y":483,"width":795,"height":11}},{"id":"fd82726b-f693-4181-893e-f34dad16fefe","block_type":"box","text":"Fund’s use of the proceeds of the current sale por tion of the transaction may be restricted pending a determination","page_number":99,"box":{"x":70,"y":498,"width":824,"height":11}},{"id":"870aebc5-e190-43ff-bf21-5056ad915aa9","block_type":"box","text":"by the other par ty, or its trustee or receiver, whether to enforce the Fund’s obligation to purchase the similar","page_number":99,"box":{"x":69,"y":513,"width":774,"height":12}},{"id":"f4e6515f-dffc-44e9-b7bf-fc924e2bc361","block_type":"box","text":"securities in the forward transaction.","page_number":99,"box":{"x":69,"y":528,"width":261,"height":9}},{"id":"2614e1fb-49fe-4fae-a384-21d9c1f90539","block_type":"box","text":"A Fund may engage in dollar roll transactions to enhance returns. Successful use of mor tgage dollar rolls may","page_number":99,"box":{"x":101,"y":551,"width":785,"height":11}},{"id":"1f4cb3dd-08ca-432e-ae7b-73001bcd0b86","block_type":"box","text":"depend upon the Manager’s ability to correctly predict interest rates and prepayments. Dollar rolls involve the risk","page_number":99,"box":{"x":69,"y":566,"width":812,"height":11}},{"id":"d565705c-972f-48fa-9408-08c0655cd0fb","block_type":"box","text":"that the market value of the securities subject to a Fund’s forward purchase commitment may decline below, or the","page_number":99,"box":{"x":68,"y":581,"width":824,"height":11}},{"id":"255eb639-aa04-4327-b51e-331a608aac6e","block_type":"box","text":"market value of the securities subject to a Fund’s forward sale commitment may increase above, the exercise price","page_number":99,"box":{"x":69,"y":596,"width":824,"height":12}},{"id":"47ef2d3a-de40-4b91-a9bd-8b2797c711e3","block_type":"box","text":"of the forward commitment. Dollar rolls are speculative techniques that can be deemed to involve leverage. There is","page_number":99,"box":{"x":69,"y":612,"width":828,"height":11}},{"id":"dd3b869d-19cf-4583-b3ee-d964786dd94e","block_type":"box","text":"no assurance that dollar rolls can be successfully employed.","page_number":99,"box":{"x":69,"y":627,"width":430,"height":11}},{"id":"d40e2b6e-f1c3-4821-b27d-f16bbbe8f23d","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into when-issued or forward-settling","page_number":99,"box":{"x":102,"y":649,"width":759,"height":12}},{"id":"f685124a-4518-4507-a359-9a50a2487020","block_type":"box","text":"securities (","page_number":99,"box":{"x":69,"y":665,"width":78,"height":11}},{"id":"3008e4a7-8c3f-4ae3-b51a-e90e2c6eeeeb","block_type":"box","text":"e.g.","page_number":99,"box":{"x":148,"y":666,"width":25,"height":10}},{"id":"d60d12f0-80cc-4dc1-8742-7b4d06ca0970","block_type":"box","text":", dollar rolls and firm and standby commitments, including TBA commitments) and non-standard","page_number":99,"box":{"x":176,"y":664,"width":681,"height":12}},{"id":"494bce5c-287f-4822-8f6e-6f62fdb4787a","block_type":"box","text":"settlement cycle securities notwithstanding the limitation on the issuance of senior securities in Section 18 of the","page_number":99,"box":{"x":69,"y":680,"width":813,"height":11}},{"id":"79ef28fd-815e-48ac-a15d-825de6dc42df","block_type":"box","text":"Investment Company Act, provided that the transaction meets the Delayed-Settlement Securities Provision (as","page_number":99,"box":{"x":70,"y":695,"width":783,"height":11}},{"id":"3d116d9c-723b-4a19-a19f-b238f2872572","block_type":"box","text":"defined below under “—When-Issued Securities, Delayed Delivery Securities and Forward Commitments”). If a when","page_number":99,"box":{"x":69,"y":710,"width":832,"height":11}},{"id":"261a6890-9af2-435f-86a9-1effc742b155","block_type":"box","text":"issued, forward-settling or non-standard settlement cycle security does not satisfy the Delayed-Settlement Securities","page_number":99,"box":{"x":70,"y":725,"width":830,"height":11}},{"id":"b92664b6-84ee-4300-acbd-60a2ef8f5198","block_type":"box","text":"Provision, then it is treated as a Derivatives Transaction under Rule 18f-4. See “—Derivatives — Regulation of","page_number":99,"box":{"x":69,"y":740,"width":788,"height":11}},{"id":"efeeff4a-6379-4ff4-b33c-d42f2c4e93a6","block_type":"box","text":"Derivatives — Rule 18f-4 under the Investment Company Act” above.","page_number":99,"box":{"x":70,"y":755,"width":489,"height":11}},{"id":"6c6b780b-e0c5-4668-977c-5aac92e66c7c","block_type":"box","text":"Net Interest Margin (NIM) Securities.","page_number":99,"box":{"x":102,"y":778,"width":260,"height":11}},{"id":"7edc4685-721f-441a-94b1-77e5dea03b8c","block_type":"box","text":"A Fund may invest in net interest margin (“NIM”) securities. These","page_number":99,"box":{"x":368,"y":778,"width":473,"height":11}},{"id":"67779e20-9721-441c-ab79-2500d11df3b4","block_type":"box","text":"securities are derivative interest-only mor tgage securities structured off home equity loan transactions. NIM","page_number":99,"box":{"x":69,"y":793,"width":768,"height":11}},{"id":"2d668397-8428-4fdf-8fac-c5994d3c5fd7","block_type":"box","text":"securities receive any “excess” interest computed after paying coupon costs, servicing costs and fees and any credit","page_number":99,"box":{"x":69,"y":808,"width":836,"height":11}},{"id":"3c2d81ba-2d8d-4789-b8d5-546f41ccf59d","block_type":"box","text":"losses associated with the underlying pool of home equity loans. Like traditional stripped mor tgage-backed","page_number":99,"box":{"x":70,"y":823,"width":760,"height":12}},{"id":"b7548c6d-fda2-454b-ab39-e00206e895df","block_type":"box","text":"securities, the yield to maturity on a NIM security is sensitive not only to changes in prevailing interest rates but also","page_number":99,"box":{"x":69,"y":839,"width":832,"height":11}},{"id":"08dc5794-4dd7-47bd-9e59-f98050a332cd","block_type":"box","text":"to the rate of principal payments (including prepayments) on the underlying home equity loans. NIM securities are","page_number":99,"box":{"x":68,"y":853,"width":810,"height":12}},{"id":"a7b397bf-f039-43d8-ada9-dedcdb8ffe5b","block_type":"box","text":"highly sensitive to credit losses on the underlying collateral and the timing in which those losses are taken.","page_number":99,"box":{"x":69,"y":869,"width":764,"height":11}},{"id":"8ceb44ca-1a82-4b6b-8e8a-4fe8db85b0f1","block_type":"box","text":"Municipal Investments.","page_number":99,"box":{"x":102,"y":891,"width":169,"height":11}},{"id":"ab0eb05e-b21a-47e8-a695-a3d619e003c5","block_type":"box","text":"II-55","page_number":99,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3671d395-a2ab-45ae-b7e6-5c5a43e5b63c","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":99,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"1efdea55-97cf-4228-b127-7efb00332f0f","block_type":"box","text":"Cer tain Funds may invest in obligations issued by or on behalf of states, territories and possessions of the","page_number":100,"box":{"x":102,"y":45,"width":763,"height":11}},{"id":"7d915d9c-9063-4234-b952-17f0b1bdd857","block_type":"box","text":"United States and the District of Columbia and their political subdivisions, agencies and instrumentalities, the","page_number":100,"box":{"x":70,"y":60,"width":783,"height":11}},{"id":"2f2e6ff1-094a-4d33-be77-7a8c0b0df2b2","block_type":"box","text":"payments from which, in the opinion of bond counsel to the issuer, are excludable from gross income for U.S. federal","page_number":100,"box":{"x":70,"y":75,"width":833,"height":11}},{"id":"a579d342-e19e-4cee-a556-157c0bd881f6","block_type":"box","text":"income tax purposes (“Municipal Bonds”). Cer tain of the Municipal Funds may also invest in Municipal Bonds that","page_number":100,"box":{"x":70,"y":90,"width":813,"height":11}},{"id":"a00b5252-ec7d-4e22-a163-951736a4888f","block_type":"box","text":"pay interest excludable from gross income for purposes of state and local income taxes of the designated state and/","page_number":100,"box":{"x":70,"y":105,"width":836,"height":11}},{"id":"fed58b10-b2f1-48e4-8440-17e5a756b4df","block_type":"box","text":"or allow the value of a Fund’s shares to be exempt from state and local taxes of the designated state (“State","page_number":100,"box":{"x":69,"y":120,"width":779,"height":12}},{"id":"a030b163-805a-4de8-8294-2e4ae56d993a","block_type":"box","text":"Municipal Bonds”). The Municipal Funds may also invest in securities not issued by or on behalf of a state or territory","page_number":100,"box":{"x":70,"y":135,"width":838,"height":11}},{"id":"d8f1065a-3574-42b8-83cc-8073be1835b8","block_type":"box","text":"or by an agency or instrumentality thereof, if the Manager believes such securities to pay interest excludable from","page_number":100,"box":{"x":69,"y":150,"width":810,"height":12}},{"id":"289f4931-cb33-4a92-b206-54d12cc89b12","block_type":"box","text":"gross income for purposes of U.S. federal income tax and state and local income taxes of the designated state and/","page_number":100,"box":{"x":68,"y":166,"width":834,"height":11}},{"id":"41e06c15-99cd-42a4-a1bf-00806e0d1a0d","block_type":"box","text":"or state and local personal proper ty taxes of the designated state (“Non-Municipal Tax-Exempt Securities”). Non","page_number":100,"box":{"x":69,"y":181,"width":801,"height":11}},{"id":"446de90f-238f-4c7c-ab96-a4e74dff3a4b","block_type":"box","text":"Municipal Tax-Exempt Securities could include trust cer tificates or other instruments evidencing interest in one or","page_number":100,"box":{"x":70,"y":196,"width":807,"height":11}},{"id":"aff527f8-257a-4fca-9086-7adb9153ea08","block_type":"box","text":"more long-term municipal securities. Non-Municipal Tax-Exempt Securities also may include securities issued by other","page_number":100,"box":{"x":69,"y":211,"width":837,"height":11}},{"id":"3cf79cb7-0206-4804-ba2b-c50a8f5c5041","block_type":"box","text":"investment companies that invest in municipal bonds, to the extent such investments are permitted by applicable","page_number":100,"box":{"x":70,"y":226,"width":809,"height":11}},{"id":"e873f753-38f4-4f72-85ec-98794d956bb6","block_type":"box","text":"law. Non-Municipal Tax-Exempt Securities that pay interest excludable from gross income for U.S. federal income tax","page_number":100,"box":{"x":70,"y":241,"width":826,"height":11}},{"id":"7fa151bc-fbcf-4867-868d-3de8eae40e1a","block_type":"box","text":"purposes will be considered “Municipal Bonds” for purposes of a Municipal Fund’s investment objective and policies.","page_number":100,"box":{"x":70,"y":256,"width":834,"height":11}},{"id":"958cc2f0-bbd2-403d-9935-f40112c25b90","block_type":"box","text":"Non-Municipal Tax-Exempt Securities that pay interest excludable from gross income for purposes of U.S. federal","page_number":100,"box":{"x":70,"y":271,"width":800,"height":12}},{"id":"86c9212a-75e1-4890-87cd-be06861dcec6","block_type":"box","text":"income tax and state and local income taxes of a designated state and/or allow the value of a Fund’s shares to be","page_number":100,"box":{"x":70,"y":286,"width":819,"height":12}},{"id":"d2d07e57-93da-4967-9292-d5e661b24de7","block_type":"box","text":"exempt from state and local personal proper ty taxes of that state will be considered “State Municipal Bonds” for","page_number":100,"box":{"x":69,"y":302,"width":805,"height":11}},{"id":"eda2eee4-0806-4b60-b216-043da470c83c","block_type":"box","text":"purposes of the investment objective and policies of each of California Municipal Oppor tunities Fund, New Jersey","page_number":100,"box":{"x":70,"y":317,"width":805,"height":11}},{"id":"ca6b6fa1-7805-482c-8bd8-1d2dfc114456","block_type":"box","text":"Municipal Bond Fund, New York Municipal Oppor tunities Fund and Pennsylvania Municipal Bond Fund.","page_number":100,"box":{"x":70,"y":332,"width":721,"height":11}},{"id":"9e7be837-d1dd-4530-815e-9638365805f0","block_type":"box","text":"Risk Factors and Special Considerations Relating to Municipal Bonds.","page_number":100,"box":{"x":102,"y":355,"width":495,"height":11}},{"id":"feba81d2-1b94-4ac5-a4d5-f07b65005f22","block_type":"box","text":"The risks and special considerations","page_number":100,"box":{"x":603,"y":355,"width":260,"height":11}},{"id":"a515563a-4b5a-467b-8476-9c3b1ceddaca","block_type":"box","text":"involved in investment in Municipal Bonds vary with the types of instruments being acquired. Investments in Non","page_number":100,"box":{"x":70,"y":370,"width":806,"height":11}},{"id":"6cbdc5bd-0f4f-478c-9810-5a72222b6e88","block_type":"box","text":"Municipal Tax-Exempt Securities may present similar risks, depending on the par ticular product. Cer tain municipal","page_number":100,"box":{"x":70,"y":385,"width":810,"height":11}},{"id":"336e842e-8f07-450e-9098-5c50418f0444","block_type":"box","text":"instruments in which a Fund may invest may be characterized as derivatives.","page_number":100,"box":{"x":70,"y":400,"width":544,"height":11}},{"id":"4926e28e-83ca-4d7d-a052-3eebded087fe","block_type":"box","text":"The value of Municipal Bonds generally may be affected by uncer tainties in the municipal markets as a result of","page_number":100,"box":{"x":101,"y":423,"width":799,"height":11}},{"id":"cb860e02-ed6a-4291-ac84-ca0423b4af2e","block_type":"box","text":"legislation or litigation, including legislation or litigation that changes the taxation of Municipal Bonds or the rights of","page_number":100,"box":{"x":70,"y":438,"width":829,"height":11}},{"id":"b41067ed-261b-4d64-b4f7-b4d611054dee","block_type":"box","text":"Municipal Bond holders in the event of a bankruptcy. Municipal bankruptcies are rare and cer tain provisions of the","page_number":100,"box":{"x":70,"y":453,"width":814,"height":11}},{"id":"d3d73b76-296c-4cb4-9382-acc0fbfa1a7d","block_type":"box","text":"U.S. Bankruptcy Code governing such bankruptcies are unclear. Fur ther, the application of state law to Municipal","page_number":100,"box":{"x":70,"y":468,"width":802,"height":11}},{"id":"4f57765d-f8a0-4671-acd4-d54831bd9615","block_type":"box","text":"Bond issuers could produce varying results among the states or among Municipal Bond issuers within a state. These","page_number":100,"box":{"x":70,"y":483,"width":834,"height":11}},{"id":"c3fce507-954c-4a2c-8edf-eb03238ba5e6","block_type":"box","text":"uncer tainties could have a significant impact on the prices of the Municipal Bonds in which a Fund invests.","page_number":100,"box":{"x":69,"y":498,"width":761,"height":11}},{"id":"6895fd3d-b265-4be2-b934-e92b0a6f390c","block_type":"box","text":"II-56","page_number":100,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"aca4fc6e-61e5-4ebb-828c-e3734ce4f44d","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":100,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"3ac6df13-37e1-47bb-941e-9e64d85da881","block_type":"box","text":"Description of Municipal Bonds.","page_number":101,"box":{"x":70,"y":45,"width":224,"height":11}},{"id":"fbf15461-0e6d-4b03-897a-1fb92860103f","block_type":"box","text":"Municipal Bonds include debt obligations issued to obtain funds for various public purposes, including the","page_number":101,"box":{"x":102,"y":67,"width":754,"height":12}},{"id":"15484e7d-0fc5-4175-8e17-38e058055a0e","block_type":"box","text":"construction of a wide range of public facilities, refunding of outstanding obligations and obtaining funds for general","page_number":101,"box":{"x":69,"y":82,"width":824,"height":12}},{"id":"87206dbe-25aa-4dec-afff-0236f055ea64","block_type":"box","text":"operating expenses and loans to other public institutions and facilities. In addition, cer tain types of bonds are issued","page_number":101,"box":{"x":69,"y":98,"width":836,"height":11}},{"id":"a60fa5cb-3f1c-49bf-b144-6a7ad9de909f","block_type":"box","text":"by or on behalf of public authorities to finance various privately owned or operated facilities, including cer tain","page_number":101,"box":{"x":69,"y":113,"width":776,"height":11}},{"id":"7a423bad-e3c2-44c9-b82d-01f89c1e4c42","block_type":"box","text":"facilities for the local furnishing of electric energy or gas, sewage facilities, solid waste disposal facilities and other","page_number":101,"box":{"x":68,"y":128,"width":822,"height":11}},{"id":"bb803131-7b3b-4da2-866a-3f651d439e6c","block_type":"box","text":"specialized facilities. Such obligations are included within the term Municipal Bonds if the interest paid thereon is","page_number":101,"box":{"x":69,"y":143,"width":810,"height":11}},{"id":"89b35fd4-e2bf-46b7-9df2-0761bd1461c1","block_type":"box","text":"excluded from gross income for U.S. federal income tax purposes and any applicable state and local taxes. Other","page_number":101,"box":{"x":69,"y":158,"width":808,"height":11}},{"id":"f1583295-970a-46d7-b25a-372d44d82689","block_type":"box","text":"types of private activity bonds, the proceeds of which are used for the construction, equipment or improvement of","page_number":101,"box":{"x":68,"y":173,"width":812,"height":11}},{"id":"64e19462-8042-49eb-bc49-5c1d233191dd","block_type":"box","text":"privately operated industrial or commercial facilities, may constitute Municipal Bonds, although the current U.S.","page_number":101,"box":{"x":70,"y":188,"width":792,"height":12}},{"id":"ba6d8ac0-3040-45b3-9eb3-1a9736a4f87f","block_type":"box","text":"federal tax laws place substantial limitations on the size of such issues. The interest on Municipal Bonds may bear a","page_number":101,"box":{"x":68,"y":203,"width":835,"height":12}},{"id":"a0e5615a-01f6-48a1-9a34-51f68f67e54e","block_type":"box","text":"fixed rate or be payable at a variable or floating rate. The two principal classifications of Municipal Bonds are “general","page_number":101,"box":{"x":68,"y":218,"width":840,"height":12}},{"id":"1a021e08-73f5-4e8b-8899-0f45424a7d4d","block_type":"box","text":"obligation” and “revenue” or “special obligation” bonds, which latter category includes private activity bonds (“PABs”)","page_number":101,"box":{"x":69,"y":234,"width":838,"height":11}},{"id":"9f8a576d-ca9e-4bc2-895c-c76b525a4c06","block_type":"box","text":"(or “industrial development bonds” under pre-1986 law).","page_number":101,"box":{"x":69,"y":249,"width":401,"height":11}},{"id":"f9654b38-2278-41ee-b06d-8277d7aa015c","block_type":"box","text":"General Obligation Bonds.","page_number":101,"box":{"x":102,"y":272,"width":184,"height":11}},{"id":"f6647979-ca13-4862-a081-289bf7bc2c6e","block_type":"box","text":"General obligation bonds are secured by the issuer’s pledge of its full faith, credit and","page_number":101,"box":{"x":292,"y":271,"width":613,"height":12}},{"id":"f1fd224f-c3b4-43d1-b0ef-7548ac0f76a9","block_type":"box","text":"taxing power for the payment of principal and interest. The taxing power of any governmental entity may be limited,","page_number":101,"box":{"x":68,"y":286,"width":816,"height":12}},{"id":"b4ffffaf-7990-4161-b36d-0a155dbb8d86","block_type":"box","text":"however, by provisions of its state constitution or laws, and an entity’s creditwor thiness will depend on many factors,","page_number":101,"box":{"x":69,"y":302,"width":834,"height":11}},{"id":"ed1fd402-2bc9-46c2-8ee8-c32b1b6d0e5c","block_type":"box","text":"including potential erosion of its tax base due to population declines, natural disasters, declines in the state’s","page_number":101,"box":{"x":70,"y":317,"width":786,"height":11}},{"id":"795c0074-ad0d-4fff-acfa-bfa0b1d9cb3f","block_type":"box","text":"industrial base or inability to attract new industries, economic limits on the ability to tax without eroding the tax base,","page_number":101,"box":{"x":70,"y":332,"width":835,"height":11}},{"id":"135d8b3f-e423-4f9b-8d56-8d76c6448b5c","block_type":"box","text":"state legislative proposals or voter initiatives to limit ad valorem real proper ty taxes and the extent to which the entity","page_number":101,"box":{"x":69,"y":347,"width":840,"height":11}},{"id":"8f4df615-caab-41e7-8f73-fe35cbd960dc","block_type":"box","text":"relies on federal or state aid, access to capital markets or other factors beyond the state’s or entity’s control.","page_number":101,"box":{"x":69,"y":362,"width":782,"height":11}},{"id":"3047ef0b-c90b-4506-97ba-66284179777d","block_type":"box","text":"Accordingly, the capacity of the issuer of a general obligation bond as to the timely payment of interest and the","page_number":101,"box":{"x":68,"y":377,"width":791,"height":12}},{"id":"1e500bf0-fa77-4187-b3ce-d69489d07fcb","block_type":"box","text":"repayment of principal when due is affected by the issuer’s maintenance of its tax base.","page_number":101,"box":{"x":69,"y":392,"width":630,"height":12}},{"id":"ab54aa6c-e7c5-4f81-8617-eabc4fe509c4","block_type":"box","text":"Revenue Bonds.","page_number":101,"box":{"x":102,"y":415,"width":114,"height":9}},{"id":"589a6b9e-0eb6-4fa3-a52b-efd819b9c477","block_type":"box","text":"Revenue bonds are payable only from the revenues derived from a par ticular facility or class of","page_number":101,"box":{"x":223,"y":415,"width":676,"height":11}},{"id":"cd97f39c-1523-4278-9a19-77008e1ff23e","block_type":"box","text":"facilities or, in some cases, from the proceeds of a special excise tax or other specific revenue source such as","page_number":101,"box":{"x":68,"y":430,"width":791,"height":11}},{"id":"992702d7-0509-447b-9ecf-ee65f61c153f","block_type":"box","text":"payments from the user of the facility being financed; accordingly, the timely payment of interest and the repayment","page_number":101,"box":{"x":70,"y":445,"width":824,"height":12}},{"id":"01202cea-431e-4f4c-bc24-936021735ad1","block_type":"box","text":"of principal in accordance with the terms of the revenue or special obligation bond is a function of the economic","page_number":101,"box":{"x":69,"y":460,"width":798,"height":12}},{"id":"6ec269b9-77a5-4943-bfe6-d092cbb170b8","block_type":"box","text":"viability of such facility or such revenue source.","page_number":101,"box":{"x":68,"y":475,"width":336,"height":12}},{"id":"2cf1c238-5b74-4548-8c35-8274710b0642","block_type":"box","text":"Revenue bonds issued by state or local agencies to finance the development of low-income, multi-family housing","page_number":101,"box":{"x":102,"y":498,"width":801,"height":11}},{"id":"992cd9ae-8857-4fcd-8a57-854382592500","block_type":"box","text":"involve special risks in addition to those associated with municipal bonds generally, including that the underlying","page_number":101,"box":{"x":70,"y":514,"width":800,"height":11}},{"id":"a8aebc57-19ef-470b-92d4-e364b836c014","block_type":"box","text":"proper ties may not generate sufficient income to pay expenses and interest costs. Such bonds are generally non","page_number":101,"box":{"x":70,"y":528,"width":810,"height":12}},{"id":"7e2c30c0-d996-4b9c-8398-ba22eee0ab85","block_type":"box","text":"recourse against the proper ty owner, may be junior to the rights of others with an interest in the proper ties, may pay","page_number":101,"box":{"x":69,"y":543,"width":830,"height":12}},{"id":"a74a6830-0292-4e75-beaa-8774debfc533","block_type":"box","text":"interest that changes based in par t on the financial per formance of the proper ty, may be prepayable without penalty","page_number":101,"box":{"x":70,"y":559,"width":828,"height":11}},{"id":"8f68707f-158f-4a46-bbe1-033a97a5910f","block_type":"box","text":"and may be used to finance the construction of housing developments which, until completed and rented, do not","page_number":101,"box":{"x":69,"y":574,"width":804,"height":11}},{"id":"cf42acc1-5a3f-45d4-ba4e-ddc1023eb049","block_type":"box","text":"generate income to pay interest. Increases in interest rates payable on senior obligations may make it more difficult","page_number":101,"box":{"x":68,"y":589,"width":830,"height":11}},{"id":"9ce9c768-67ab-4d70-bb49-56c0144346b0","block_type":"box","text":"for issuers to meet payment obligations on subordinated bonds.","page_number":101,"box":{"x":68,"y":604,"width":457,"height":11}},{"id":"372c678f-fece-4194-8347-7d11fbaa700b","block_type":"box","text":"PABs.","page_number":101,"box":{"x":102,"y":627,"width":38,"height":9}},{"id":"258fd6bc-ad29-4be8-ab7b-46bd84965dfb","block_type":"box","text":"PABs are, in most cases, tax-exempt securities issued by states, municipalities or public authorities to","page_number":101,"box":{"x":147,"y":627,"width":730,"height":11}},{"id":"ef156bf0-ecf5-4e22-9422-239d06fffe06","block_type":"box","text":"provide funds, usually through a loan or lease arrangement, to a private entity for the purpose of financing","page_number":101,"box":{"x":70,"y":642,"width":755,"height":11}},{"id":"0ff12764-9df0-4ac9-b397-1bc91fb06751","block_type":"box","text":"construction or improvement of a facility to be used by the entity. Such bonds are secured primarily by revenues","page_number":101,"box":{"x":69,"y":657,"width":797,"height":11}},{"id":"198a10e9-b829-4d0f-8844-d698f58040be","block_type":"box","text":"derived from loan repayments or lease payments due from the entity, which may or may not be guaranteed by a","page_number":101,"box":{"x":69,"y":672,"width":793,"height":11}},{"id":"5066d4fa-c83d-4f55-90c9-29a456feee0c","block_type":"box","text":"parent company or otherwise secured. PABs generally are not secured by a pledge of the taxing power of the issuer of","page_number":101,"box":{"x":70,"y":687,"width":840,"height":11}},{"id":"d67f2818-3b44-44df-9e57-6eb2d5acc6f0","block_type":"box","text":"such bonds. Therefore, an investor should understand that repayment of such bonds generally depends on the","page_number":101,"box":{"x":69,"y":702,"width":789,"height":12}},{"id":"6f30370b-9179-4eae-8fe4-e978741f2f1f","block_type":"box","text":"revenues of a private entity and be aware of the risks that such an investment may entail. The continued ability of an","page_number":101,"box":{"x":69,"y":717,"width":832,"height":12}},{"id":"3f1cf26d-208e-4818-ab47-fe027838e22a","block_type":"box","text":"entity to generate sufficient revenues for the payment of principal and interest on such bonds will be affected by","page_number":101,"box":{"x":69,"y":732,"width":802,"height":12}},{"id":"274396e7-8a3c-40a5-9419-e8cc2ce7d185","block_type":"box","text":"many factors including the size of the entity, its capital structure, demand for its products or services, competition,","page_number":101,"box":{"x":69,"y":748,"width":819,"height":11}},{"id":"d5521738-376a-41cd-8f09-8bf3a546a9d0","block_type":"box","text":"general economic conditions, government regulation and the entity’s dependence on revenues for the operation of","page_number":101,"box":{"x":68,"y":763,"width":816,"height":11}},{"id":"549e8a4f-ba3c-4361-baa8-8d6c12bdb1f5","block_type":"box","text":"the par ticular facility being financed.","page_number":101,"box":{"x":68,"y":778,"width":258,"height":11}},{"id":"f2ff6db3-8771-4dfe-8d03-5e00e2d07b4b","block_type":"box","text":"Moral Obligation Bonds.","page_number":101,"box":{"x":102,"y":801,"width":169,"height":11}},{"id":"0d1b9b6c-123b-4c9f-9ef8-4b54d2b0f96d","block_type":"box","text":"“Moral obligation” bonds are normally issued by special purpose public authorities. If an","page_number":101,"box":{"x":278,"y":801,"width":628,"height":11}},{"id":"98adf874-a282-45ab-8cd9-d8edce1b1878","block_type":"box","text":"issuer of moral obligation bonds is unable to meet its obligations, the repayment of such bonds becomes a moral","page_number":101,"box":{"x":70,"y":816,"width":809,"height":11}},{"id":"9565e735-7e66-46a0-bea2-c5ce35312ecb","block_type":"box","text":"commitment but not a legal obligation of the state or municipality that created the special purpose public authority","page_number":101,"box":{"x":69,"y":831,"width":816,"height":11}},{"id":"06fb516c-af48-4fe2-8b0d-b1ffeb97e78a","block_type":"box","text":"that issued the bonds.","page_number":101,"box":{"x":68,"y":846,"width":160,"height":9}},{"id":"cd879a80-4e24-4336-b563-f92ec68784a6","block_type":"box","text":"Municipal Notes.","page_number":101,"box":{"x":102,"y":869,"width":118,"height":11}},{"id":"2d212777-d663-4408-9dcb-21116471bf5a","block_type":"box","text":"Municipal notes are shor ter term municipal debt obligations. They may provide interim financing","page_number":101,"box":{"x":227,"y":869,"width":683,"height":11}},{"id":"76212cb7-0637-42b0-b903-bcd9e3639b23","block_type":"box","text":"in anticipation of tax collection, bond sales or revenue receipts. If there is a shor tfall in the anticipated proceeds,","page_number":101,"box":{"x":70,"y":884,"width":807,"height":11}},{"id":"d9ec984b-484e-4576-8a08-bbabbfdcfd6a","block_type":"box","text":"repayment on the note may be delayed or the note may not be fully repaid, and a Fund may lose money.","page_number":101,"box":{"x":69,"y":899,"width":739,"height":11}},{"id":"c5bd4b80-f085-4995-bc92-b6ad8dfa76d8","block_type":"box","text":"II-57","page_number":101,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3f8544d1-9919-42ad-99a8-2c5730899059","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":101,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"339eceb6-381a-4e07-a9d7-9f5cf20b4ad7","block_type":"box","text":"Municipal Commercial Paper.","page_number":102,"box":{"x":102,"y":45,"width":205,"height":11}},{"id":"5a0a64e8-515e-48fa-b95f-6dd1b7eb1a1b","block_type":"box","text":"Municipal commercial paper is generally unsecured and issued to meet shor t-term","page_number":102,"box":{"x":314,"y":45,"width":586,"height":11}},{"id":"574b798f-15f9-4ed8-9198-7cd9e1a3f318","block_type":"box","text":"financing needs. The lack of security presents some risk of loss to a Fund since, in the event of an issuer’s","page_number":102,"box":{"x":68,"y":60,"width":767,"height":11}},{"id":"ae202269-5034-4359-b935-524d7b165a5d","block_type":"box","text":"bankruptcy, unsecured creditors are repaid only after the secured creditors out of the assets, if any, that remain.","page_number":102,"box":{"x":69,"y":75,"width":803,"height":11}},{"id":"af428207-9f61-4317-ad50-aab09b3e5929","block_type":"box","text":"Municipal Lease Obligations.","page_number":102,"box":{"x":102,"y":98,"width":203,"height":11}},{"id":"c854402e-6ae9-4d99-8d13-7aed0423dfd2","block_type":"box","text":"Also included within the general category of Municipal Bonds are cer tificates of","page_number":102,"box":{"x":311,"y":98,"width":566,"height":11}},{"id":"489a862b-2599-4c30-94d8-7ca0e830b4d5","block_type":"box","text":"par ticipation (“COPs”) issued by government authorities or entities to finance the acquisition or construction of","page_number":102,"box":{"x":70,"y":113,"width":791,"height":11}},{"id":"a1d35a0e-fd1f-4dc8-8a1e-641a90fb7ebd","block_type":"box","text":"equipment, land and/or facilities. The COPs represent par ticipations in a lease, an installment purchase contract or a","page_number":102,"box":{"x":69,"y":128,"width":840,"height":11}},{"id":"6c20ae3d-a38d-482d-87fc-7fbaa8a7f037","block_type":"box","text":"conditional sales contract (hereinafter collectively called “lease obligations”) relating to such equipment, land or","page_number":102,"box":{"x":69,"y":143,"width":800,"height":11}},{"id":"04169cef-0a9e-4d20-91f0-68a16d9d5cc8","block_type":"box","text":"facilities. Municipal leases, like other municipal debt obligations, are subject to the risk of non-payment. Although","page_number":102,"box":{"x":68,"y":158,"width":809,"height":11}},{"id":"9f0c4fde-97cd-44c4-80f6-825d25d51094","block_type":"box","text":"lease obligations do not constitute general obligations of the issuer for which the issuer’s unlimited taxing power is","page_number":102,"box":{"x":70,"y":173,"width":820,"height":11}},{"id":"b86f3985-59bf-49a0-a793-273e24e114d9","block_type":"box","text":"pledged, a lease obligation is frequently backed by the issuer’s covenant to budget for, appropriate and make the","page_number":102,"box":{"x":70,"y":188,"width":808,"height":12}},{"id":"0cd84636-eadd-4105-a689-9e7306819516","block_type":"box","text":"payments due under the lease obligation. However, cer tain lease obligations contain “non-appropriation” clauses,","page_number":102,"box":{"x":70,"y":204,"width":809,"height":11}},{"id":"2b674164-802d-4665-9bcf-937c57591186","block_type":"box","text":"which provide that the issuer has no obligation to make lease or installment purchase payments in future years","page_number":102,"box":{"x":68,"y":218,"width":795,"height":12}},{"id":"f76b98a7-9f5b-4400-8926-5ecbf466a2cb","block_type":"box","text":"unless money is appropriated for such purpose on a yearly basis. Although “non-appropriation” lease obligations are","page_number":102,"box":{"x":69,"y":234,"width":829,"height":11}},{"id":"81fcd63a-0034-4409-afd5-ea59a9f9af86","block_type":"box","text":"secured by the leased proper ty, disposition of the proper ty in the event of foreclosure might prove difficult. These","page_number":102,"box":{"x":69,"y":249,"width":810,"height":11}},{"id":"f2a9ca6d-64a7-43b6-9e45-1917bb354f4a","block_type":"box","text":"securities represent a type of financing that has not yet developed the depth of marketability associated with more","page_number":102,"box":{"x":69,"y":264,"width":817,"height":11}},{"id":"2f126e56-d8ce-460b-972c-ab99897a306c","block_type":"box","text":"conventional securities. Cer tain investments in lease obligations may be illiquid.","page_number":102,"box":{"x":69,"y":279,"width":572,"height":11}},{"id":"0fd5f370-47ea-4c0f-87f3-56741d486ad1","block_type":"box","text":"The ability of issuers of municipal leases to make timely lease payments may be adversely impacted in general","page_number":102,"box":{"x":101,"y":302,"width":791,"height":11}},{"id":"b653a0b3-4a42-4285-84dd-d61fb442c32e","block_type":"box","text":"economic downturns and as relative governmental cost burdens are allocated and reallocated among federal, state","page_number":102,"box":{"x":69,"y":317,"width":822,"height":11}},{"id":"03c68a28-45d8-444c-9849-1da21ea12d3a","block_type":"box","text":"and local governmental units. Such non-payment would result in a reduction of income to a Fund and could result in a","page_number":102,"box":{"x":69,"y":332,"width":837,"height":11}},{"id":"1383c918-cde2-47e9-9df2-0fecd2587f39","block_type":"box","text":"reduction in the value of the municipal lease experiencing non-payment and a potential decrease in the NAV of a","page_number":102,"box":{"x":69,"y":347,"width":798,"height":11}},{"id":"f386ad3a-dc9b-45ce-b8f4-57f1b380981c","block_type":"box","text":"Fund. Issuers of municipal securities might seek protection under the bankruptcy laws. In the event of bankruptcy of","page_number":102,"box":{"x":70,"y":362,"width":828,"height":11}},{"id":"a605c877-5cbf-4c67-858f-2244893fece1","block_type":"box","text":"such an issuer, a Fund could experience delays and limitations with respect to the collection of principal and interest","page_number":102,"box":{"x":69,"y":377,"width":833,"height":11}},{"id":"8265e327-8498-458a-8b94-4d0fbd104118","block_type":"box","text":"on such municipal leases and a Fund may not, in all circumstances, be able to collect all principal and interest to","page_number":102,"box":{"x":69,"y":393,"width":807,"height":11}},{"id":"c47286c3-702f-43ee-bf03-07e65a6404a9","block_type":"box","text":"which it is entitled. To enforce its rights in the event of a default in lease payments, a Fund might take possession of","page_number":102,"box":{"x":68,"y":407,"width":835,"height":12}},{"id":"4ee6287a-4c58-4194-b848-e2885b57a83f","block_type":"box","text":"and manage the assets securing the issuer’s obligations on such securities, which may increase a Fund’s operating","page_number":102,"box":{"x":69,"y":423,"width":828,"height":11}},{"id":"e8b74033-dc3d-48c2-b2c4-68daa0f49cd7","block_type":"box","text":"expenses and adversely affect the NAV of a Fund. When the lease contains a non-appropriation clause, however, the","page_number":102,"box":{"x":69,"y":438,"width":829,"height":11}},{"id":"6edd010b-f762-447f-a5d4-657efff9a481","block_type":"box","text":"failure to pay would not be a default and a Fund would not have the right to take possession of the assets. Any","page_number":102,"box":{"x":68,"y":453,"width":793,"height":11}},{"id":"c94ef139-fa17-473c-a7e4-a4ab02a4f7dd","block_type":"box","text":"income derived from a Fund’s ownership or operation of such assets may not be tax-exempt. In addition, a Fund’s","page_number":102,"box":{"x":70,"y":468,"width":810,"height":11}},{"id":"5f69a229-2269-4c71-a0e3-c5a3920ba9bb","block_type":"box","text":"intention to qualify as a “regulated investment company” under the Code, may limit the extent to which a Fund may","page_number":102,"box":{"x":70,"y":483,"width":820,"height":11}},{"id":"4146cf8f-8d7b-40a1-94c4-64ef5bb0bdbf","block_type":"box","text":"exercise its rights by taking possession of such assets, because as a regulated investment company a Fund is","page_number":102,"box":{"x":69,"y":498,"width":790,"height":11}},{"id":"43d72c23-ef95-4d32-9c4c-468391a4350f","block_type":"box","text":"subject to cer tain limitations on its investments and on the nature of its income.","page_number":102,"box":{"x":69,"y":513,"width":574,"height":11}},{"id":"acc8f47f-31f8-4baa-b3a1-065e7896bdcf","block_type":"box","text":"Tender Option Bonds.","page_number":102,"box":{"x":103,"y":536,"width":150,"height":11}},{"id":"c9732b5d-28ee-4226-b544-5b07d89d5b9a","block_type":"box","text":"Cer tain Funds may invest in residual inverse floating rate interest tender option bonds","page_number":102,"box":{"x":260,"y":536,"width":613,"height":11}},{"id":"2932a1e7-03a8-448d-87ca-9d25e2d264e0","block_type":"box","text":"(“TOB Residuals”), which are derivative interests in Municipal Bonds. The TOB Residuals in which the Funds will","page_number":102,"box":{"x":69,"y":551,"width":796,"height":11}},{"id":"5875b5be-8693-42eb-ab4c-2b7cb87cc7c7","block_type":"box","text":"invest pay interest or income that, in the opinion of counsel to the issuer, is exempt from regular U.S. federal income","page_number":102,"box":{"x":70,"y":566,"width":834,"height":11}},{"id":"82d9bebe-83f8-4368-9788-98cb60f467ed","block_type":"box","text":"tax. BlackRock will not conduct its own analysis of the tax status of the interest or income paid by TOB Residuals","page_number":102,"box":{"x":68,"y":581,"width":807,"height":11}},{"id":"e605dba9-1b98-432c-9e4a-3f537fb9a5b4","block_type":"box","text":"held by the Funds, but will rely on the opinion of counsel to the issuer. Although volatile, TOB Residuals typically offer","page_number":102,"box":{"x":69,"y":596,"width":836,"height":12}},{"id":"45fd5fac-31d2-4359-826f-3816aa4f9f54","block_type":"box","text":"the potential for yields exceeding the yields available on fixed rate Municipal Bonds with comparable credit quality.","page_number":102,"box":{"x":68,"y":612,"width":814,"height":11}},{"id":"851eb35e-508a-4d59-8729-5459aeb7853d","block_type":"box","text":"The Funds may invest in TOB Residuals for the purpose of using economic leverage.","page_number":102,"box":{"x":68,"y":627,"width":598,"height":11}},{"id":"b9762fe9-bd20-483b-b7f9-445cc9a57643","block_type":"box","text":"TOB Residuals represent beneficial interests in a special purpose trust formed for the purpose of holding","page_number":102,"box":{"x":101,"y":649,"width":751,"height":12}},{"id":"4403962b-ef00-423a-8e53-59f424c03344","block_type":"box","text":"Municipal Bonds contributed by one or more funds (a “TOB Trust”). A TOB Trust typically issues two classes of","page_number":102,"box":{"x":70,"y":664,"width":786,"height":12}},{"id":"16acf022-8843-4207-8ce6-a3340c9f2c86","block_type":"box","text":"beneficial interests: shor t-term floating rate interests (“TOB Floaters”), which are sold to third-par ty investors, and","page_number":102,"box":{"x":69,"y":680,"width":813,"height":11}},{"id":"e79f3805-67dc-47f8-b5db-41f00b0d6846","block_type":"box","text":"TOB Residuals, which are generally issued to the fund(s) that transferred Municipal Bonds to the TOB Trust. The","page_number":102,"box":{"x":68,"y":695,"width":799,"height":11}},{"id":"bbee77d0-722f-40ec-871c-f4d7f083c76f","block_type":"box","text":"Funds may invest in both TOB Floaters and TOB Residuals. TOB Floaters may have first priority on the cash flow from","page_number":102,"box":{"x":70,"y":710,"width":830,"height":11}},{"id":"55e6acac-1506-401b-b6a0-d1da2040eff9","block_type":"box","text":"the Municipal Bonds held by the TOB Trust and are enhanced with a liquidity suppor t arrangement from a third-par ty","page_number":102,"box":{"x":68,"y":725,"width":828,"height":11}},{"id":"ca78b48d-c408-4d02-9b98-45d2577aee97","block_type":"box","text":"Liquidity Provider (defined below) which allows holders to tender their position at par (plus accrued interest). A Fund,","page_number":102,"box":{"x":70,"y":740,"width":826,"height":11}},{"id":"3601f157-faa2-457d-81d8-93a2525f0896","block_type":"box","text":"as a holder of TOB Residuals, is paid the residual cash flow from the TOB Trust. A Fund that contributes the","page_number":102,"box":{"x":69,"y":755,"width":768,"height":11}},{"id":"aede13f2-d9af-4197-a6fb-e11eed2b0b6c","block_type":"box","text":"Municipal Bonds to the TOB Trust is paid the cash received by the TOB Trust from the sale of the TOB Floaters, less","page_number":102,"box":{"x":70,"y":770,"width":825,"height":11}},{"id":"be0472ff-dce0-4fb6-9136-989c4c82eb1c","block_type":"box","text":"cer tain transaction costs, and typically will invest the cash to purchase additional Municipal Bonds or other","page_number":102,"box":{"x":69,"y":786,"width":764,"height":11}},{"id":"bafe5574-7608-4533-98d5-bc6d17b1f5e5","block_type":"box","text":"investments permitted by its investment policies. If a Fund ever purchases all or a por tion of the TOB Floaters sold by","page_number":102,"box":{"x":70,"y":801,"width":838,"height":11}},{"id":"4a073993-a3b1-4093-a02f-c306486a7617","block_type":"box","text":"the TOB Trust, it may surrender those TOB Floaters together with a propor tionate amount of TOB Residuals to the","page_number":102,"box":{"x":68,"y":816,"width":810,"height":11}},{"id":"831b2c6b-7656-44c6-9973-9d1aa71856f7","block_type":"box","text":"TOB Trust in exchange for a propor tionate amount of the Municipal Bonds owned by the TOB Trust.","page_number":102,"box":{"x":68,"y":831,"width":704,"height":11}},{"id":"fb470bcd-524a-40a9-881c-38137519b0f7","block_type":"box","text":"Other BlackRock-advised funds may contribute Municipal Bonds to a TOB Trust into which a Fund has contributed","page_number":102,"box":{"x":102,"y":853,"width":804,"height":12}},{"id":"8ab5b45a-643f-489d-a4bb-e887b627efe7","block_type":"box","text":"Municipal Bonds. If multiple BlackRock-advised funds par ticipate in the same TOB Trust, the economic rights and","page_number":102,"box":{"x":70,"y":869,"width":805,"height":11}},{"id":"e335001e-c4bd-4023-a1a3-e50e1424b6c4","block_type":"box","text":"obligations under the TOB Residual will generally be shared among the funds ratably in propor tion to their","page_number":102,"box":{"x":69,"y":884,"width":752,"height":11}},{"id":"badff006-27c4-4db0-8a4d-64991efeb15b","block_type":"box","text":"par ticipation in the TOB Trust.","page_number":102,"box":{"x":70,"y":899,"width":211,"height":11}},{"id":"77ca7722-a17f-46ad-b971-7bcf5a3d8da0","block_type":"box","text":"II-58","page_number":102,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"1192e067-8471-46ad-9b11-c2367df8d837","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":102,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"14920e36-1463-410f-9c81-4c03fe31850d","block_type":"box","text":"The Municipal Bonds transferred to a TOB Trust typically are high grade Municipal Bonds. In cer tain cases, when","page_number":103,"box":{"x":101,"y":45,"width":802,"height":11}},{"id":"43e41452-3d7a-43f5-9c99-d24bab6b896a","block_type":"box","text":"Municipal Bonds transferred are lower grade Municipal Bonds, the TOB Trust transaction includes a credit","page_number":103,"box":{"x":70,"y":60,"width":753,"height":11}},{"id":"5a5265b1-5040-4a37-a79c-e01395a5db32","block_type":"box","text":"enhancement feature that provides for the timely payment of principal and interest on the bonds to the TOB Trust by","page_number":103,"box":{"x":69,"y":75,"width":829,"height":11}},{"id":"b445778f-8c62-4f99-ab17-a0e1717ce131","block_type":"box","text":"a credit enhancement provider. The TOB Trust would be responsible for the payment of the credit enhancement fee","page_number":103,"box":{"x":69,"y":90,"width":819,"height":11}},{"id":"8166a436-1eff-4b80-9b57-f2bfffb6f615","block_type":"box","text":"and a Fund, as a TOB Residual holder, would be responsible for reimbursement of any payments of principal and","page_number":103,"box":{"x":69,"y":105,"width":802,"height":11}},{"id":"13fc6c76-745a-46b2-a80a-6ddba15884d4","block_type":"box","text":"interest made by the credit enhancement provider.","page_number":103,"box":{"x":70,"y":120,"width":357,"height":11}},{"id":"24f7d71a-b5b4-44f4-a167-5457b656c8aa","block_type":"box","text":"The TOB Residuals held by a Fund generally provide the Fund with the right to cause the holders of a propor tional","page_number":103,"box":{"x":101,"y":143,"width":807,"height":11}},{"id":"a7785d88-802a-4245-a379-8be4b2e5ae73","block_type":"box","text":"share of the TOB Floaters to tender their notes to the TOB Trust at par plus accrued interest. Thereafter, the Fund","page_number":103,"box":{"x":69,"y":158,"width":810,"height":11}},{"id":"f4146c50-257d-416d-b3a6-6ff27ef67339","block_type":"box","text":"may withdraw a corresponding share of the Municipal Bonds from the TOB Trust. This transaction, in effect, creates","page_number":103,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"63907908-5ca7-47a6-9c1e-50db66039a59","block_type":"box","text":"exposure for the Fund to the entire return of the Municipal Bonds in the TOB Trust, with a net cash investment by the","page_number":103,"box":{"x":69,"y":188,"width":834,"height":11}},{"id":"6eaeb8a5-3f44-499a-858f-32af79a46935","block_type":"box","text":"Fund that is less than the value of the Municipal Bonds in the TOB Trust. This multiplies the positive or negative","page_number":103,"box":{"x":70,"y":203,"width":797,"height":12}},{"id":"2e388a05-137c-4261-8880-42230759656d","block_type":"box","text":"impact of the Municipal Bonds’ return within the Fund (thereby creating leverage). The leverage within a TOB Trust","page_number":103,"box":{"x":70,"y":218,"width":809,"height":12}},{"id":"9fcca2e7-f892-45aa-be49-52e955fcd037","block_type":"box","text":"depends on the value of the Municipal Bonds deposited in the TOB Trust relative to the value of the TOB Floaters it","page_number":103,"box":{"x":69,"y":234,"width":820,"height":11}},{"id":"20503f9b-f518-466b-8cb3-69267abda175","block_type":"box","text":"issues.","page_number":103,"box":{"x":70,"y":249,"width":49,"height":9}},{"id":"d3164de9-65ad-4840-b13f-d44b6403d30a","block_type":"box","text":"A Fund may invest in highly leveraged TOB Residuals. A TOB Residual generally is considered highly leveraged if","page_number":103,"box":{"x":101,"y":271,"width":795,"height":12}},{"id":"81f09f65-6443-40cb-9f82-40476a041df3","block_type":"box","text":"the principal amount of the TOB Floaters issued by the related TOB Trust exceeds 75% of the principal amount of the","page_number":103,"box":{"x":68,"y":286,"width":833,"height":12}},{"id":"a0dda2d6-f246-4863-b443-13d6225b23d0","block_type":"box","text":"Municipal Bonds owned by the TOB Trust.","page_number":103,"box":{"x":70,"y":302,"width":293,"height":11}},{"id":"765a232e-4397-4af7-a97a-1c8453028e12","block_type":"box","text":"The TOB Trust may be collapsed without the consent of a Fund upon the occurrence of tender option termination","page_number":103,"box":{"x":101,"y":324,"width":802,"height":11}},{"id":"bd69522e-32b8-4154-b737-45e5504c2070","block_type":"box","text":"events (“TOTEs”) and mandatory termination events (“MTEs”), as defined in the TOB Trust agreements. TOTEs","page_number":103,"box":{"x":69,"y":339,"width":788,"height":12}},{"id":"8f5220fb-fa0e-4279-8195-a564325fe86f","block_type":"box","text":"include the bankruptcy or default of the issuer of the Municipal Bonds held in the TOB Trust, a substantial downgrade","page_number":103,"box":{"x":70,"y":355,"width":836,"height":11}},{"id":"e115ddfb-645c-46b3-bfe1-a1261c090bd6","block_type":"box","text":"in the credit quality of the issuer of the Municipal Bonds held in the TOB Trust, failure of any scheduled payment of","page_number":103,"box":{"x":70,"y":370,"width":819,"height":11}},{"id":"6f3f7ba7-1643-433b-9efa-b04b1d97c4ce","block_type":"box","text":"principal or interest on the Municipal Bonds, and a judgment or ruling that interest on the Municipal Bonds is subject","page_number":103,"box":{"x":70,"y":385,"width":833,"height":11}},{"id":"e9a5e506-c522-4204-a6ab-2b608d643f73","block_type":"box","text":"to U.S. federal income taxation. MTEs may include, among other things, a failed remarketing of the TOB Floaters, the","page_number":103,"box":{"x":68,"y":400,"width":834,"height":11}},{"id":"43270b0b-0cca-47fa-b17e-9cf4432f0114","block_type":"box","text":"inability of the TOB Trust to obtain renewal of the liquidity suppor t agreement, and a substantial decline in the market","page_number":103,"box":{"x":70,"y":415,"width":838,"height":11}},{"id":"ac2aa73c-e712-4664-9bd3-e599069d0a35","block_type":"box","text":"value of the Municipal Bonds held in the TOB Trust. Upon the occurrence of a TOTE or an MTE, a TOB Trust would be","page_number":103,"box":{"x":68,"y":430,"width":831,"height":11}},{"id":"de9259e6-1719-42bc-9112-5d08f8142392","block_type":"box","text":"liquidated with the proceeds applied first to any accrued fees owed to the trustee of the TOB Trust, the remarketing","page_number":103,"box":{"x":70,"y":445,"width":823,"height":12}},{"id":"4aa6f7d3-6c12-4488-b78a-e3dbf04490bf","block_type":"box","text":"agent of the TOB Floaters and the Liquidity Provider (defined below). In the case of an MTE, after the payment of fees,","page_number":103,"box":{"x":69,"y":460,"width":839,"height":12}},{"id":"8322cca9-4aee-48c3-be0f-b88af66bd9df","block_type":"box","text":"the holders of the TOB Floaters would be paid senior to the TOB Residual holders (","page_number":103,"box":{"x":68,"y":475,"width":589,"height":12}},{"id":"a5b263e0-769b-4922-8a72-22caad3ee3d4","block_type":"box","text":"i.e.","page_number":103,"box":{"x":659,"y":476,"width":21,"height":8}},{"id":"177266fb-148c-4d29-9843-b4fdb7035b50","block_type":"box","text":", the Fund). In contrast, in the","page_number":103,"box":{"x":682,"y":476,"width":211,"height":11}},{"id":"9c6b105e-ff30-42bf-8c19-9c3b2b305032","block_type":"box","text":"case of a TOTE, after payment of fees, the holders of TOB Floaters and the TOB Residual holders would be paid pro","page_number":103,"box":{"x":69,"y":491,"width":822,"height":11}},{"id":"ec5d95f2-afe5-43fa-a843-fd9bf883a066","block_type":"box","text":"rata in propor tion to the respective face values of their cer tificates.","page_number":103,"box":{"x":69,"y":506,"width":479,"height":11}},{"id":"c18e9eb5-ddbd-4cb7-ad7f-d63dc0d09f05","block_type":"box","text":"A Fund may invest in a TOB Trust on either a non-recourse or recourse basis. TOB Trusts are typically suppor ted","page_number":103,"box":{"x":101,"y":529,"width":797,"height":11}},{"id":"e2294708-0a45-40df-990a-a2f834497524","block_type":"box","text":"by a liquidity facility provided by a third-par ty bank or other financial institution (the “Liquidity Provider”) that allows","page_number":103,"box":{"x":69,"y":543,"width":815,"height":12}},{"id":"4c021a7b-9c49-419f-8581-aa8b024693d2","block_type":"box","text":"the holders of the TOB Floaters to tender their TOB Floaters in exchange for payment of par plus accrued interest on","page_number":103,"box":{"x":68,"y":559,"width":828,"height":11}},{"id":"9b155c5f-9f66-4033-8822-ebb01e2849c2","block_type":"box","text":"any business day (subject to the non-occurrence of a TOTE described above). Depending on the structure of the TOB","page_number":103,"box":{"x":69,"y":574,"width":828,"height":11}},{"id":"6d631645-0c42-4c1f-8e47-8fed9849442c","block_type":"box","text":"Trust, the Liquidity Provider may purchase the tendered TOB Floaters, or the TOB Trust may draw upon a loan from","page_number":103,"box":{"x":68,"y":589,"width":815,"height":11}},{"id":"e30ebe49-2964-4738-8f96-62f096b5b153","block_type":"box","text":"the Liquidity Provider to purchase the tendered TOB Floaters.","page_number":103,"box":{"x":68,"y":604,"width":434,"height":11}},{"id":"0c4d1e31-8630-490c-b813-6d27e1a81610","block_type":"box","text":"When a Fund invests in TOB Trusts on a non-recourse basis, and the Liquidity Provider is required to make a","page_number":103,"box":{"x":101,"y":627,"width":772,"height":11}},{"id":"97d40508-2749-443a-866c-8ebf01d5b43f","block_type":"box","text":"payment under the liquidity facility, the Liquidity Provider will typically liquidate all or a por tion of the Municipal Bonds","page_number":103,"box":{"x":70,"y":642,"width":831,"height":11}},{"id":"834a536e-a213-4e3f-802e-f6bad6a40625","block_type":"box","text":"held in the TOB Trust and then fund the balance, if any, of the amount owed under the liquidity facility over the","page_number":103,"box":{"x":69,"y":657,"width":785,"height":11}},{"id":"3102189b-977b-494a-85b5-0f420e2e4641","block_type":"box","text":"liquidation proceeds (the “Liquidation Shor tfall”). If a Fund invests in a TOB Trust on a recourse basis, it will typically","page_number":103,"box":{"x":70,"y":672,"width":831,"height":11}},{"id":"3fe86634-e6a9-4bc1-bbc8-0d35b6c74f92","block_type":"box","text":"enter into a reimbursement agreement with the Liquidity Provider pursuant to which the Fund is required to reimburse","page_number":103,"box":{"x":69,"y":687,"width":836,"height":11}},{"id":"8a547f1f-3608-41a5-9422-109c84b470e5","block_type":"box","text":"the Liquidity Provider the amount of any Liquidation Shor tfall. As a result, if the Fund invests in a recourse TOB Trust,","page_number":103,"box":{"x":68,"y":702,"width":836,"height":11}},{"id":"309bed9c-3653-49b6-89b5-d2ef6a211f1b","block_type":"box","text":"the Fund will bear the risk of loss with respect to any Liquidation Shor tfall. If multiple BlackRock-advised funds","page_number":103,"box":{"x":68,"y":717,"width":788,"height":12}},{"id":"65ce99e1-7994-4655-94f4-6e180e212755","block_type":"box","text":"par ticipate in any such TOB Trust, these losses will be shared ratably, in propor tion to their par ticipation in the TOB","page_number":103,"box":{"x":70,"y":733,"width":823,"height":11}},{"id":"34b15132-54e8-4e32-9cd9-8683310adde7","block_type":"box","text":"Trust.","page_number":103,"box":{"x":68,"y":748,"width":39,"height":9}},{"id":"ee029dc3-3fb2-475f-9c54-c6547791e8a2","block_type":"box","text":"Under accounting rules, Municipal Bonds of a Fund that are deposited into a TOB Trust are investments of the","page_number":103,"box":{"x":102,"y":770,"width":784,"height":12}},{"id":"3ed9aec8-8458-44af-b2ca-2ec073523123","block_type":"box","text":"Fund and are presented on the Fund’s Schedule of Investments and outstanding TOB Floaters issued by a TOB Trust","page_number":103,"box":{"x":70,"y":785,"width":830,"height":12}},{"id":"cc0d4b8e-38a3-40d0-a762-701811bda042","block_type":"box","text":"are presented as liabilities in the Fund’s Statement of Assets and Liabilities. Interest income from the underlying","page_number":103,"box":{"x":69,"y":801,"width":806,"height":11}},{"id":"0841aa90-1b9b-4621-8e84-357b1261117c","block_type":"box","text":"Municipal Bonds is recorded by a Fund on an accrual basis. Interest expense incurred on the TOB Floaters and other","page_number":103,"box":{"x":70,"y":816,"width":831,"height":11}},{"id":"94f973ca-6128-40f7-a1d9-16ea9c5b540d","block_type":"box","text":"expenses related to remarketing, administration, trustee and other services to a TOB Trust are repor ted as expenses","page_number":103,"box":{"x":69,"y":831,"width":837,"height":11}},{"id":"39a3adef-aebb-4bd3-bc1d-78d474458414","block_type":"box","text":"of a Fund. In addition, under accounting rules, loans made to a TOB Trust sponsored by a Fund may be presented as","page_number":103,"box":{"x":69,"y":846,"width":832,"height":11}},{"id":"48c58ead-7849-4c9a-88c1-9f6c9df0469c","block_type":"box","text":"loans of the Fund in the Fund’s financial statements even if there is no recourse to the Fund’s assets.","page_number":103,"box":{"x":70,"y":861,"width":728,"height":9}},{"id":"97707929-e8a4-4f04-8aac-4e25b797de25","block_type":"box","text":"For TOB Floaters, generally, the interest rate earned will be based upon the market rates for Municipal Bonds","page_number":103,"box":{"x":102,"y":884,"width":776,"height":11}},{"id":"1bd7ea03-4d1c-4519-a354-e896dc198445","block_type":"box","text":"with maturities or remarketing provisions that are comparable in duration to the periodic interval of the tender option.","page_number":103,"box":{"x":68,"y":899,"width":837,"height":11}},{"id":"4cda540f-9d20-446f-8f69-4b42f45e460e","block_type":"box","text":"II-59","page_number":103,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"b7c266b4-0a6c-488b-8561-322b0c2a1a77","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":103,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"1078307b-f13d-4ce1-999d-628c81a11637","block_type":"box","text":"Since the tender option feature has a shor ter term than the final maturity or first call date of the underlying Municipal","page_number":104,"box":{"x":69,"y":45,"width":836,"height":11}},{"id":"1bf2ff2e-445e-4cfe-8da1-8e3b4183ed40","block_type":"box","text":"Bonds deposited in the TOB Trust, the holder of the TOB Floaters relies upon the terms of the agreement with the","page_number":104,"box":{"x":70,"y":60,"width":809,"height":11}},{"id":"aab26514-bd8f-48c8-9f6d-12f875452fb2","block_type":"box","text":"financial institution furnishing the liquidity facility as well as the credit strength of that institution. The risk associated","page_number":104,"box":{"x":68,"y":75,"width":836,"height":11}},{"id":"fc8ceb24-9d82-4361-bc65-14d61f938239","block_type":"box","text":"with TOB Floaters, however, may be increased in the current market environment as a result of recent downgrades to","page_number":104,"box":{"x":68,"y":90,"width":835,"height":11}},{"id":"d2e00733-727a-4fc8-9fd3-8ac82b34877e","block_type":"box","text":"the credit ratings, and thus the perceived reliability and creditwor thiness, of many major financial institutions, some","page_number":104,"box":{"x":68,"y":105,"width":827,"height":11}},{"id":"187457d8-7079-4e70-8aa8-260ecfa79f78","block_type":"box","text":"of which sponsor and/or provide liquidity suppor t to TOB Trusts. This in turn may reduce the desirability of TOB","page_number":104,"box":{"x":69,"y":120,"width":790,"height":11}},{"id":"58b8a07b-92af-4d5a-b7a4-a1a91b584c34","block_type":"box","text":"Floaters as investments, which could impair the viability or availability of TOB Trusts.","page_number":104,"box":{"x":70,"y":135,"width":599,"height":11}},{"id":"264e8266-d140-413d-a625-654b0307a3ca","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into TOB Trust transactions, reverse","page_number":104,"box":{"x":102,"y":158,"width":762,"height":11}},{"id":"b4497249-42be-450b-8721-943c95d692bc","block_type":"box","text":"repurchase agreements and similar financing transactions (e.g., borrowed bonds) notwithstanding the limitation on","page_number":104,"box":{"x":69,"y":173,"width":818,"height":11}},{"id":"b8adaa92-58c2-4869-b142-e392297efe11","block_type":"box","text":"the issuance of senior securities in Section 18 of the Investment Company Act, provided that the Fund either","page_number":104,"box":{"x":68,"y":188,"width":778,"height":11}},{"id":"8bd87464-0619-406e-906d-e3cbdaa22344","block_type":"box","text":"(i) complies with the 300% asset coverage ratio with respect to such transactions and any other borrowings in the","page_number":104,"box":{"x":69,"y":203,"width":811,"height":12}},{"id":"b7d986aa-6b29-4471-890a-f80a9feec7f3","block_type":"box","text":"aggregate, or (ii) treats such transactions as Derivatives Transactions under Rule 18f-4. See “—Derivatives —","page_number":104,"box":{"x":69,"y":218,"width":786,"height":12}},{"id":"b5f4259e-4a52-4fba-b7fb-ac390a9e53f1","block_type":"box","text":"Regulation of Derivatives — Rule 18f-4 under the Investment Company Act” above.","page_number":104,"box":{"x":70,"y":234,"width":588,"height":11}},{"id":"215a6970-a4a1-4ed1-809a-2add74981f17","block_type":"box","text":"Developments in the TOB Trust Market.","page_number":104,"box":{"x":102,"y":256,"width":279,"height":11}},{"id":"2c54b70d-e0a1-42cf-9ca8-551b8648deb7","block_type":"box","text":"In response to the restrictions imposed by section 619 of the Dodd-Frank Wall Street Reform and Consumer","page_number":104,"box":{"x":102,"y":279,"width":771,"height":11}},{"id":"059078f4-401d-4350-9a83-dc24de9270fa","block_type":"box","text":"Protection Act (the “Volcker Rule”), market par ticipants have developed a structure for TOB Trusts designed to","page_number":104,"box":{"x":69,"y":294,"width":786,"height":11}},{"id":"1f2f15fc-5c20-4211-9990-7c37393cfddf","block_type":"box","text":"ensure that no banking entity is sponsoring the TOB Trust for purposes of the Volcker Rule. Specifically, a Fund will","page_number":104,"box":{"x":69,"y":309,"width":816,"height":11}},{"id":"5b64d9d3-a9dd-4361-95fe-39508fb2cd1b","block_type":"box","text":"establish, structure and “sponsor” the TOB Trusts in which it holds TOB Residuals. In such a structure, cer tain","page_number":104,"box":{"x":69,"y":324,"width":791,"height":11}},{"id":"51323196-ded3-4874-bbe0-393289e5cf6c","block_type":"box","text":"responsibilities that previously belonged to the sponsor bank will be per formed by, or on behalf of, a Fund. A Fund","page_number":104,"box":{"x":69,"y":339,"width":812,"height":12}},{"id":"d9f02516-7935-4e4b-a971-4bc6747cf18b","block_type":"box","text":"may utilize service providers in meeting these responsibilities. It is possible that regulators could take positions that","page_number":104,"box":{"x":69,"y":355,"width":832,"height":11}},{"id":"b281de78-f25d-4b0d-8168-b4ec0605c156","block_type":"box","text":"could limit the market for such structured TOB Trust transactions or a Fund’s ability to hold TOB Residuals. Under","page_number":104,"box":{"x":69,"y":370,"width":810,"height":11}},{"id":"c7e053ed-1ba1-43b8-99cb-aae5b7ae55d6","block_type":"box","text":"this TOB Trust structure, a Fund has cer tain additional duties and responsibilities, which may give rise to cer tain","page_number":104,"box":{"x":68,"y":385,"width":803,"height":11}},{"id":"702e5ef2-7e33-4730-9df3-6d4fe5c77f92","block_type":"box","text":"additional risks including, but not limited to, compliance, securities law and operational risks.","page_number":104,"box":{"x":69,"y":400,"width":665,"height":11}},{"id":"385245f0-0313-4e80-9a0d-a98b608ca5b7","block_type":"box","text":"Under this structure, service providers to a TOB Trust, such as administrators, liquidity providers, trustees, and","page_number":104,"box":{"x":102,"y":423,"width":793,"height":11}},{"id":"58f4a60f-6415-4629-8d7f-3e33c03475fe","block_type":"box","text":"remarketing agents, act at the direction of, and as agent of, a Fund as the TOB Residual holder. Similar to the","page_number":104,"box":{"x":69,"y":438,"width":783,"height":11}},{"id":"b868139a-ef2e-4126-b8f5-57ffe2189eaf","block_type":"box","text":"traditional tender option bond structure, a Fund deposits Municipal Bonds into the TOB Trust in exchange for TOB","page_number":104,"box":{"x":68,"y":453,"width":808,"height":11}},{"id":"fcdd9613-d8ef-4003-b3ee-622922bfb6a4","block_type":"box","text":"Residuals, the TOB Trust then issues and sells TOB Floaters to third-par ty investors, and the proceeds of the sale of","page_number":104,"box":{"x":70,"y":468,"width":830,"height":11}},{"id":"c3f6912f-ab5b-4480-ae9f-cbb0fcfd5d46","block_type":"box","text":"the TOB Floaters is distributed to such TOB Residual holders (","page_number":104,"box":{"x":68,"y":483,"width":442,"height":11}},{"id":"02912103-bbd3-4474-a3e6-c80383d52a39","block_type":"box","text":"i.e.","page_number":104,"box":{"x":512,"y":483,"width":20,"height":9}},{"id":"3e126b16-a95e-401a-9746-be37f34a99cd","block_type":"box","text":", the Fund). Tendered TOB Floaters continue to be","page_number":104,"box":{"x":535,"y":483,"width":352,"height":11}},{"id":"4fc5d37b-3b8d-4cf3-99e0-4a7700e6e5d2","block_type":"box","text":"suppor ted by a remarketing agent and a liquidity facility. However, the remarketing agent does not purchase tendered","page_number":104,"box":{"x":69,"y":498,"width":836,"height":11}},{"id":"418604e4-d61d-48ce-ab63-ecf59b001807","block_type":"box","text":"TOB Floaters for its own account in the event of a failed remarketing, which may increase the likelihood that a TOB","page_number":104,"box":{"x":68,"y":513,"width":816,"height":12}},{"id":"367818e6-ae2a-4de0-96a4-fe6541297ed1","block_type":"box","text":"Trust will need to be collapsed and liquidated in order to purchase the tendered TOB Floaters. In the event of a failed","page_number":104,"box":{"x":68,"y":528,"width":835,"height":11}},{"id":"e2d75f83-3974-4603-ad94-b6d4b6052b64","block_type":"box","text":"remarketing of TOB Floaters, the Liquidity Provider, at its option, may advance a loan to the TOB Trust the proceeds","page_number":104,"box":{"x":69,"y":543,"width":822,"height":12}},{"id":"3e6dde51-3576-42f3-a89e-7d0762063607","block_type":"box","text":"of which would be used by the TOB Trust to purchase the tendered TOB Floaters. The Liquidity Provider is not","page_number":104,"box":{"x":69,"y":559,"width":777,"height":11}},{"id":"83e5b3f8-56d9-48a7-8e81-4f15f16cd6f0","block_type":"box","text":"obligated to advance such a loan. The TOB Trust would be the borrower with respect to any such loan. Any loans","page_number":104,"box":{"x":69,"y":574,"width":800,"height":11}},{"id":"6eca2d7f-8bc5-41dc-b90e-9240a2bc20ed","block_type":"box","text":"made by a Liquidity Provider will be secured by the purchased TOB Floaters held by the TOB Trust.","page_number":104,"box":{"x":69,"y":589,"width":696,"height":11}},{"id":"bc1ba1a9-4a25-4f28-b6c1-fc0ad4ec9e2d","block_type":"box","text":"Similar to the traditional structure for TOB Trusts, a Fund may hold either non-recourse TOB Residuals or","page_number":104,"box":{"x":102,"y":612,"width":745,"height":11}},{"id":"17a4ae10-7a10-40fb-a783-96897e3b34b2","block_type":"box","text":"recourse TOB Residuals under this structure. In the event of a Liquidation Shor tfall, there would generally be no","page_number":104,"box":{"x":69,"y":627,"width":797,"height":11}},{"id":"429367f1-725c-44c3-96b5-79beaa9a62af","block_type":"box","text":"contractual recourse to the Fund’s assets if the Fund holds a non-recourse TOB Residual. However, as described","page_number":104,"box":{"x":69,"y":642,"width":803,"height":10}},{"id":"6df75bb6-0654-4b37-963b-66ecff9d95cd","block_type":"box","text":"above, a Fund would bear the risk of loss with respect to any Liquidation Shor tfall if it holds a recourse TOB Residual.","page_number":104,"box":{"x":69,"y":657,"width":838,"height":11}},{"id":"15dd7150-d672-47a4-8ad6-2742556f568f","block_type":"box","text":"The SEC and various federal banking and housing agencies adopted credit risk retention rules for securitizations","page_number":104,"box":{"x":101,"y":680,"width":801,"height":11}},{"id":"0a6ec791-7afa-49ed-b00a-bee510f2cadb","block_type":"box","text":"(the “Risk Retention Rules”), which took effect in December 2016. The Risk Retention Rules require the sponsor of a","page_number":104,"box":{"x":69,"y":695,"width":838,"height":11}},{"id":"11459db6-6220-43f5-9ca2-402ba6c82bed","block_type":"box","text":"TOB Trust to retain at least 5% of the credit risk of the underlying assets suppor ting the TOB Trust’s Municipal","page_number":104,"box":{"x":68,"y":710,"width":787,"height":11}},{"id":"29006c9f-97c4-43d2-b6f8-5e09980e2481","block_type":"box","text":"Bonds. The Risk Retention Rules may adversely affect the Fund’s ability to engage in TOB Trust transactions or","page_number":104,"box":{"x":70,"y":725,"width":791,"height":11}},{"id":"2f103a34-e06e-4eb5-baed-82193a6d729d","block_type":"box","text":"increase the costs of such transactions in cer tain circumstances.","page_number":104,"box":{"x":70,"y":740,"width":466,"height":9}},{"id":"84e8648b-146c-4681-aa91-318e08483da1","block_type":"box","text":"TOB Trust transactions constitute an impor tant component of the municipal bond market. Accordingly,","page_number":104,"box":{"x":101,"y":763,"width":726,"height":11}},{"id":"cd0acff0-d8c6-465b-bddd-9147b20a0c60","block_type":"box","text":"implementation of the Volcker Rule may adversely impact the municipal market, including through reduced demand","page_number":104,"box":{"x":70,"y":778,"width":816,"height":11}},{"id":"aefe21c8-c951-4892-ba6a-1a077e056c9d","block_type":"box","text":"for and liquidity of municipal bonds and increased financing costs for municipal issuers. Any such developments","page_number":104,"box":{"x":68,"y":793,"width":799,"height":11}},{"id":"286de3f3-8648-40e6-bced-00fec7393688","block_type":"box","text":"could adversely affect the Funds. The ultimate impact of these rules on the TOB market and the overall municipal","page_number":104,"box":{"x":69,"y":808,"width":807,"height":11}},{"id":"45668541-6ba8-441f-b852-a162c6700a22","block_type":"box","text":"market is not yet cer tain.","page_number":104,"box":{"x":69,"y":823,"width":178,"height":11}},{"id":"5015d9f4-1e06-4716-9bc3-d5066ed0cd4d","block_type":"box","text":"Yields.","page_number":104,"box":{"x":103,"y":846,"width":45,"height":9}},{"id":"76c43731-e7aa-445c-b2e3-0f3b215b756e","block_type":"box","text":"Yields on Municipal Bonds are dependent on a variety of factors, including the general condition of the","page_number":104,"box":{"x":154,"y":846,"width":730,"height":11}},{"id":"b20997a0-4280-4145-a8e1-dec8cf4cf02e","block_type":"box","text":"money market and of the municipal bond market, the size of a par ticular offering, the financial condition of the","page_number":104,"box":{"x":69,"y":861,"width":788,"height":11}},{"id":"936e2417-b06b-459e-a90a-a0f7ca4c4844","block_type":"box","text":"issuer, the maturity of the obligation and the rating of the issue. The ability of a Fund to achieve its investment","page_number":104,"box":{"x":70,"y":876,"width":787,"height":11}},{"id":"1830db56-9954-44d4-9613-4ce6f4a13b1d","block_type":"box","text":"objective is also dependent on the continuing ability of the issuers of the securities in which the Fund invests to meet","page_number":104,"box":{"x":69,"y":891,"width":838,"height":12}},{"id":"bbdf23a2-8d06-4e67-a901-570e6031a828","block_type":"box","text":"their obligations for the payment of interest and principal when due. There are variations in the risks involved in","page_number":104,"box":{"x":68,"y":906,"width":794,"height":12}},{"id":"422654f7-7cdd-40dd-9378-a5ccae800c1c","block_type":"box","text":"II-60","page_number":104,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"4dd6ec16-839e-40ad-b158-c1a458bec501","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":104,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"8cbd027d-85fd-48d0-9800-9946c0452b3e","block_type":"box","text":"holding Municipal Bonds, both within a par ticular classification and between classifications, depending on numerous","page_number":105,"box":{"x":69,"y":45,"width":831,"height":11}},{"id":"5dde4dc9-cf5f-4882-9647-209f2abcf3c6","block_type":"box","text":"factors. Fur thermore, the rights of owners of Municipal Bonds and the obligations of the issuer of such Municipal","page_number":105,"box":{"x":68,"y":60,"width":806,"height":11}},{"id":"93027ad4-eab4-40c5-a395-b12f66197ae0","block_type":"box","text":"Bonds may be subject to applicable bankruptcy, insolvency and similar laws and cour t decisions affecting the rights","page_number":105,"box":{"x":70,"y":75,"width":823,"height":11}},{"id":"b5be8b9a-f64d-441e-9669-328a2c5e7bf4","block_type":"box","text":"of creditors generally and to general equitable principles, which may limit the enforcement of cer tain remedies.","page_number":105,"box":{"x":69,"y":90,"width":790,"height":11}},{"id":"57ed161a-29d3-41b3-add5-2e603b7b7591","block_type":"box","text":"Variable Rate Demand Obligations (“VRDOs”).","page_number":105,"box":{"x":103,"y":113,"width":323,"height":11}},{"id":"78fb944f-6549-4a6c-9a28-4617f494ec07","block_type":"box","text":"VRDOs are tax-exempt obligations that contain a floating or","page_number":105,"box":{"x":432,"y":113,"width":422,"height":11}},{"id":"2a070f28-40f9-4038-9457-668a269d15eb","block_type":"box","text":"variable interest rate adjustment formula and a right of demand on the par t of the holder thereof to receive payment","page_number":105,"box":{"x":68,"y":128,"width":830,"height":11}},{"id":"a4758362-7c30-4df6-8a77-f8ce2e66fccb","block_type":"box","text":"of the unpaid principal balance plus accrued interest upon a shor t notice period not to exceed seven days.","page_number":105,"box":{"x":69,"y":143,"width":759,"height":11}},{"id":"4fa6cb34-bb25-4cd3-b8af-9c9ecb9486ca","block_type":"box","text":"There is the possibility that because of default or insolvency the demand feature of VRDOs may not be honored.","page_number":105,"box":{"x":101,"y":166,"width":798,"height":11}},{"id":"93626827-883e-496a-87d4-a161a2ae8566","block_type":"box","text":"The interest rates are adjustable at periodic intervals to some prevailing market rate for similar investments, such","page_number":105,"box":{"x":68,"y":181,"width":815,"height":11}},{"id":"9b891d28-2343-4e81-861b-73e0dfec6574","block_type":"box","text":"adjustment formula being calculated to maintain the market rate of the VRDOs at approximately the par value of the","page_number":105,"box":{"x":69,"y":196,"width":826,"height":11}},{"id":"74f5d623-7cec-4215-b36e-16e9a573d7d2","block_type":"box","text":"VRDOs on the adjustment date. The adjustments typically are based upon the Securities Industry and Financial","page_number":105,"box":{"x":68,"y":211,"width":791,"height":11}},{"id":"c2b22551-66c1-4240-a798-a7060cd85132","block_type":"box","text":"Markets Association (“SIFMA”) Index.","page_number":105,"box":{"x":70,"y":226,"width":264,"height":11}},{"id":"68e57d09-8126-4a75-accf-48da5f756b90","block_type":"box","text":"Because of the interest rate adjustment formula on VRDOs, VRDOs are not comparable to fixed rate securities.","page_number":105,"box":{"x":102,"y":249,"width":791,"height":11}},{"id":"31a06f72-8e6c-48cd-88e4-98bcd1b3bae6","block_type":"box","text":"During periods of declining interest rates, a Fund’s yield on a VRDO will decrease and its shareholders will forego the","page_number":105,"box":{"x":70,"y":264,"width":833,"height":11}},{"id":"6878da0f-3345-4191-a036-4be054ab37a0","block_type":"box","text":"oppor tunity for capital appreciation. During periods of rising interest rates, however, a Fund’s yield on a VRDO will","page_number":105,"box":{"x":69,"y":279,"width":808,"height":11}},{"id":"bd5b42da-98e9-482a-aaea-8699a1dbf281","block_type":"box","text":"increase and the Fund’s shareholders will have a reduced risk of capital depreciation.","page_number":105,"box":{"x":70,"y":294,"width":608,"height":11}},{"id":"efdacc5a-0fd7-4db7-b477-e115a80438a0","block_type":"box","text":"Transactions in Financial Futures Contracts on Municipal Indexes.","page_number":105,"box":{"x":103,"y":317,"width":465,"height":11}},{"id":"c2cccd8a-3302-4da8-80a2-61221ad33763","block_type":"box","text":"The Municipal Funds and cer tain other funds","page_number":105,"box":{"x":574,"y":317,"width":318,"height":11}},{"id":"1b7e1404-7642-4421-97c0-f44999e217df","block_type":"box","text":"deal in financial futures contracts based on a long-term municipal bond index developed by the Chicago Board of","page_number":105,"box":{"x":69,"y":332,"width":803,"height":11}},{"id":"042f82ce-e126-41aa-9a52-73067d5d22df","block_type":"box","text":"Trade (“CBT”) and The Bond Buyer (the “Municipal Bond Index”). The Municipal Bond Index is comprised of 40 long","page_number":105,"box":{"x":68,"y":347,"width":825,"height":11}},{"id":"b7d504e4-d1cb-4cdb-b50b-0e1197fa7888","block_type":"box","text":"term, actively traded tax-exempt municipal revenue and general obligation bonds. Each bond included in the Municipal","page_number":105,"box":{"x":68,"y":362,"width":840,"height":11}},{"id":"31f4501a-6c42-4a15-95c8-04591ab7df76","block_type":"box","text":"Bond Index must be rated A or higher by Moody’s or S&P and must have a remaining maturity of 19 years or more.","page_number":105,"box":{"x":70,"y":377,"width":815,"height":12}},{"id":"b5aa5d4e-0b68-45f1-8626-72749f2852b1","block_type":"box","text":"Twice a month new issues satisfying the eligibility requirements are added to, and an equal number of old issues are","page_number":105,"box":{"x":68,"y":392,"width":836,"height":12}},{"id":"339baf04-c0e5-4924-89e4-3a34011dcb1c","block_type":"box","text":"deleted from, the Municipal Bond Index. The value of the Municipal Bond Index is computed daily according to a","page_number":105,"box":{"x":69,"y":407,"width":796,"height":12}},{"id":"00ca5326-9c50-4cc7-80fe-e4dbe2af8359","block_type":"box","text":"formula based on the price of each bond in the Municipal Bond Index, as evaluated by six dealer-to-dealer brokers.","page_number":105,"box":{"x":68,"y":423,"width":816,"height":11}},{"id":"d3e3dd57-b77c-432a-874b-5587acc87d87","block_type":"box","text":"The Municipal Bond Index futures contract is traded only on the CBT. Like other contract markets, the CBT","page_number":105,"box":{"x":101,"y":445,"width":756,"height":11}},{"id":"d176a5da-3a8b-4736-8c8b-a9e90b58e455","block_type":"box","text":"assures per formance under futures contracts through a clearing corporation, a nonprofit organization managed by the","page_number":105,"box":{"x":69,"y":460,"width":839,"height":12}},{"id":"6c70e5e9-5f8d-4646-b85f-4a0eb4fa5066","block_type":"box","text":"exchange membership that is also responsible for handling daily accounting of deposits or withdrawals of margin.","page_number":105,"box":{"x":69,"y":475,"width":808,"height":12}},{"id":"92ebd2ef-0b31-494d-aa8d-7f31d3da62cb","block_type":"box","text":"The par ticular municipal bonds comprising the index underlying the Municipal Bond Index financial futures","page_number":105,"box":{"x":101,"y":498,"width":753,"height":11}},{"id":"9c48b3f1-61b1-4f6f-8225-bcb1e7ee54af","block_type":"box","text":"contract may vary from the bonds held by a Municipal Fund. As a result, a Municipal Fund’s ability to hedge","page_number":105,"box":{"x":69,"y":513,"width":764,"height":12}},{"id":"4723ce81-289c-4ea9-97e9-450ddcfde936","block_type":"box","text":"effectively all or a por tion of the value of its Municipal Bonds through the use of such financial futures contracts will","page_number":105,"box":{"x":69,"y":528,"width":826,"height":12}},{"id":"1016ca23-00fb-4c8c-aa69-e78fd9958a64","block_type":"box","text":"depend in par t on the degree to which price movements in the index underlying the financial futures contract","page_number":105,"box":{"x":69,"y":543,"width":774,"height":12}},{"id":"a58281f2-1dd8-42ed-99ee-4b900381723b","block_type":"box","text":"correlate with the price movements of the Municipal Bonds held by the Fund. The correlation may be affected by","page_number":105,"box":{"x":69,"y":559,"width":801,"height":11}},{"id":"01821afc-bea8-48e9-8de8-438606f3fc5e","block_type":"box","text":"disparities in the average maturity, ratings, geographical mix or structure of a Municipal Fund’s investments as","page_number":105,"box":{"x":69,"y":574,"width":788,"height":11}},{"id":"c3bc9b38-d905-4987-82b6-0cd8f1af55ec","block_type":"box","text":"compared to those comprising the Municipal Bond Index and general economic or political factors. In addition, the","page_number":105,"box":{"x":69,"y":589,"width":812,"height":11}},{"id":"679c1e27-5826-4a27-a26d-0eb600a803aa","block_type":"box","text":"correlation between movements in the value of the Municipal Bond Index may be subject to change over time as","page_number":105,"box":{"x":69,"y":604,"width":799,"height":11}},{"id":"54d0b16d-d490-414a-86c6-45cd66465ab4","block_type":"box","text":"additions to and deletions from the Municipal Bond Index alter its structure. The correlation between futures","page_number":105,"box":{"x":69,"y":619,"width":772,"height":11}},{"id":"2a9a2f74-92da-43a3-a27e-1e971cc4f4f6","block_type":"box","text":"contracts on U.S. Government Securities and the Municipal Bonds held by a Municipal Fund may be adversely","page_number":105,"box":{"x":69,"y":634,"width":782,"height":11}},{"id":"04950140-4d0e-49fd-928c-f2f2ab61ee73","block_type":"box","text":"affected by similar factors and the risk of imper fect correlation between movements in the prices of such futures","page_number":105,"box":{"x":69,"y":649,"width":806,"height":12}},{"id":"6cb6f3a1-337f-4f57-80fb-72997024fe31","block_type":"box","text":"contracts and the prices of Municipal Bonds held by a Municipal Fund may be greater. Municipal Bond Index futures","page_number":105,"box":{"x":69,"y":664,"width":823,"height":12}},{"id":"27bc85c5-84e9-4d78-beaf-a06d14cf0ac4","block_type":"box","text":"contracts were approved for trading in 1985. Trading in such futures contracts may tend to be less liquid than trading","page_number":105,"box":{"x":69,"y":680,"width":837,"height":11}},{"id":"202bb500-3c04-422a-bfd6-5cd733e4047f","block_type":"box","text":"in other futures contracts. The trading of futures contracts also is subject to cer tain market risks, such as inadequate","page_number":105,"box":{"x":70,"y":695,"width":839,"height":11}},{"id":"3ee53777-f956-415e-ba82-b57c0d562693","block_type":"box","text":"trading activity, which could at times make it difficult or impossible to liquidate existing positions.","page_number":105,"box":{"x":68,"y":710,"width":693,"height":11}},{"id":"c487c523-f40a-41fd-a01f-a934cd4f865d","block_type":"box","text":"Call Rights.","page_number":105,"box":{"x":102,"y":733,"width":79,"height":11}},{"id":"3b5212fc-d7fb-40b3-97fe-91d624d9b8ff","block_type":"box","text":"A Fund may purchase a Municipal Bond issuer’s right to call all or a por tion of such Municipal Bond","page_number":105,"box":{"x":187,"y":732,"width":708,"height":12}},{"id":"346033e1-0552-49f2-b14f-79f7a620f376","block_type":"box","text":"for mandatory tender for purchase (a “Call Right”). A holder of a Call Right may exercise such right to require a","page_number":105,"box":{"x":68,"y":748,"width":790,"height":11}},{"id":"a1b18617-e2bd-4034-9e63-ee934348f043","block_type":"box","text":"mandatory tender for the purchase of related Municipal Bonds, subject to cer tain conditions. A Call Right that is not","page_number":105,"box":{"x":69,"y":763,"width":827,"height":11}},{"id":"125f77c7-0378-4f90-8928-e314d5dcb44f","block_type":"box","text":"exercised prior to maturity of the related Municipal Bond will expire without value. The economic effect of holding","page_number":105,"box":{"x":69,"y":778,"width":805,"height":11}},{"id":"fdf5d959-d03b-46cc-a1fc-45d2c3af3138","block_type":"box","text":"both the Call Right and the related Municipal Bond is identical to holding a Municipal Bond as a non-callable security.","page_number":105,"box":{"x":69,"y":793,"width":833,"height":11}},{"id":"9ecd9b41-86de-4370-a8cd-f6685de343d1","block_type":"box","text":"Cer tain investments in such obligations may be illiquid.","page_number":105,"box":{"x":69,"y":808,"width":393,"height":11}},{"id":"ea751d1c-b066-4e83-8bb5-12fee79557c2","block_type":"box","text":"Municipal Interest Rate Swap Transactions.","page_number":105,"box":{"x":102,"y":831,"width":307,"height":11}},{"id":"d799cc2e-97c4-4271-beae-e0fad17eb3c9","block_type":"box","text":"In order to hedge the value of a Fund against interest rate","page_number":105,"box":{"x":417,"y":831,"width":411,"height":11}},{"id":"14f0703f-4dbf-4d44-83dc-bebcc23fab6a","block_type":"box","text":"fluctuations or to enhance a Fund’s income, a Fund may enter into interest rate swap transactions such as Municipal","page_number":105,"box":{"x":68,"y":846,"width":835,"height":11}},{"id":"7ae52ad3-a794-43e2-8093-ed6f82c744ac","block_type":"box","text":"Market Data AAA Cash Curve swaps (“MMD Swaps”) or Securities Industry and Financial Markets Association","page_number":105,"box":{"x":70,"y":861,"width":781,"height":11}},{"id":"aa66ebc0-9733-4143-a481-9cc9be4308cc","block_type":"box","text":"Municipal Swap Index swaps (“SIFMA Swaps”). To the extent that a Fund enters into these transactions, the Fund","page_number":105,"box":{"x":70,"y":876,"width":808,"height":11}},{"id":"b6e2baec-7c94-48dc-a961-dbbfc925b0e1","block_type":"box","text":"expects to do so primarily to preserve a return or spread on a par ticular investment or por tion of its por tfolio or to","page_number":105,"box":{"x":69,"y":891,"width":814,"height":11}},{"id":"6a5ae82d-17bf-4749-b22b-7206fd61633b","block_type":"box","text":"protect against any increase in the price of securities the Fund anticipates purchasing at a later date. A Fund intends","page_number":105,"box":{"x":70,"y":906,"width":832,"height":12}},{"id":"2ed29ed6-5abc-4bf7-8d72-7086fe268915","block_type":"box","text":"II-61","page_number":105,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"0545b11c-ff0f-4597-8735-5e73e4732c6e","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":105,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"ca4cfc9a-ba50-4880-9c19-ebcece4a1380","block_type":"box","text":"to use these transactions primarily as a hedge rather than as a speculative investment. However, a Fund also may","page_number":106,"box":{"x":68,"y":45,"width":817,"height":11}},{"id":"f3f61735-3204-466f-9860-39e22886aab6","block_type":"box","text":"invest in MMD Swaps and SIFMA Swaps to enhance income or gain or to increase the Fund’s yield, for example,","page_number":106,"box":{"x":70,"y":60,"width":797,"height":11}},{"id":"bfdc4950-299e-4ace-8624-f0ff5c7328c7","block_type":"box","text":"during periods of steep interest rate yield curves (","page_number":106,"box":{"x":69,"y":75,"width":356,"height":11}},{"id":"4b1ac908-3a31-46aa-8aa2-13eedb0e95c2","block_type":"box","text":"i.e.","page_number":106,"box":{"x":427,"y":75,"width":20,"height":9}},{"id":"407918c0-f216-42c0-8fa7-fbdc647feb13","block_type":"box","text":", wide differences between shor t-term and long-term interest","page_number":106,"box":{"x":449,"y":75,"width":433,"height":11}},{"id":"90915620-2c55-4394-a2ab-0be68d92d9dc","block_type":"box","text":"rates).","page_number":106,"box":{"x":69,"y":90,"width":44,"height":11}},{"id":"57df6c82-ab0b-4dc3-a492-bb1b50259369","block_type":"box","text":"A Fund may purchase and sell SIFMA Swaps in the SIFMA swap market. In a SIFMA Swap, a Fund exchanges with","page_number":106,"box":{"x":101,"y":113,"width":807,"height":11}},{"id":"6b46b1ea-e8b7-49f4-a36b-031920ca6741","block_type":"box","text":"another par ty their respective commitments to pay or receive interest (","page_number":106,"box":{"x":69,"y":128,"width":503,"height":11}},{"id":"eef1ff83-35ee-40e8-80f2-5a157473267d","block_type":"box","text":"e.g.","page_number":106,"box":{"x":574,"y":129,"width":25,"height":10}},{"id":"3a31089e-161b-4fe9-9393-af280d834d0a","block_type":"box","text":", an exchange of fixed rate payments for","page_number":106,"box":{"x":601,"y":128,"width":286,"height":11}},{"id":"5eb160d2-ef74-4ae9-b668-0b587f468b08","block_type":"box","text":"floating rate payments linked to the SIFMA Municipal Swap Index). Because the underlying index is a tax-exempt","page_number":106,"box":{"x":68,"y":143,"width":798,"height":11}},{"id":"cf0f4776-c46f-4c4b-a6ef-1aaf09c84cdc","block_type":"box","text":"index, SIFMA Swaps may reduce cross-market risks incurred by a Fund and increase a Fund’s ability to hedge","page_number":106,"box":{"x":70,"y":158,"width":778,"height":11}},{"id":"f9ca2ebe-f512-4717-b172-c161f276808e","block_type":"box","text":"effectively. SIFMA Swaps are typically quoted for the entire yield curve, beginning with a seven day floating rate index","page_number":106,"box":{"x":69,"y":173,"width":833,"height":11}},{"id":"39c929f4-19de-46a3-b34e-5ff36a32aa1f","block_type":"box","text":"out to 30 years. The duration of a SIFMA Swap is approximately equal to the duration of a fixed-rate Municipal Bond","page_number":106,"box":{"x":69,"y":188,"width":823,"height":11}},{"id":"483545ce-0368-4009-8b38-95dcfe50afe8","block_type":"box","text":"with the same attributes as the swap (","page_number":106,"box":{"x":68,"y":204,"width":275,"height":10}},{"id":"22b3b473-8c31-448c-a10f-c614894cda50","block_type":"box","text":"e.g.","page_number":106,"box":{"x":345,"y":205,"width":24,"height":10}},{"id":"8aab60ce-2b51-4a70-96b9-60368dc9ec5c","block_type":"box","text":", coupon, maturity, call feature).","page_number":106,"box":{"x":372,"y":203,"width":224,"height":12}},{"id":"03019500-91e3-4c8c-8fa5-f7a9fdaa9ab8","block_type":"box","text":"A Fund may also purchase and sell MMD Swaps, also known as MMD rate locks. An MMD Swap permits a Fund","page_number":106,"box":{"x":101,"y":226,"width":797,"height":11}},{"id":"f5d6c1d3-a707-4a90-9630-ba48873a5c2b","block_type":"box","text":"to lock in a specified municipal interest rate for a por tion of its por tfolio to preserve a return on a par ticular","page_number":106,"box":{"x":68,"y":241,"width":770,"height":11}},{"id":"694586fc-1515-4999-9251-40bdd95e1e8b","block_type":"box","text":"investment or a por tion of its por tfolio as a duration management technique or to protect against any increase in the","page_number":106,"box":{"x":70,"y":256,"width":832,"height":12}},{"id":"397349f2-948d-461b-8796-16b96e6628b4","block_type":"box","text":"price of securities to be purchased at a later date. By using an MMD Swap, a Fund can create a synthetic long or","page_number":106,"box":{"x":70,"y":271,"width":805,"height":12}},{"id":"bf1e16e7-92d6-4dcf-808d-63dbb0262123","block_type":"box","text":"shor t position, allowing the Fund to select the most attractive par t of the yield curve. An MMD Swap is a contract","page_number":106,"box":{"x":69,"y":286,"width":808,"height":12}},{"id":"d9e09061-0e74-4e6d-bd95-db1517ae684d","block_type":"box","text":"between a Fund and an MMD Swap provider pursuant to which the par ties agree to make payments to each other on","page_number":106,"box":{"x":69,"y":302,"width":832,"height":11}},{"id":"8f571c5c-461e-4cde-b921-8eddde42a414","block_type":"box","text":"a notional amount, contingent upon whether the Municipal Market Data AAA General Obligation Scale is above or","page_number":106,"box":{"x":69,"y":317,"width":804,"height":11}},{"id":"9976c98c-eb31-402c-ad9a-991f5f4c9166","block_type":"box","text":"below a specified level on the expiration date of the contract. For example, if a Fund buys an MMD Swap and the","page_number":106,"box":{"x":69,"y":332,"width":803,"height":11}},{"id":"a795de1f-0619-4029-8da8-4b3ba615f6de","block_type":"box","text":"Municipal Market Data AAA General Obligation Scale is below the specified level on the expiration date, the","page_number":106,"box":{"x":70,"y":347,"width":763,"height":11}},{"id":"8f30e8ca-61b0-48c0-aab8-6fe8452a01fd","block_type":"box","text":"counterpar ty to the contract will make a payment to the Fund equal to the specified level minus the actual level,","page_number":106,"box":{"x":69,"y":362,"width":797,"height":11}},{"id":"fc97ceed-4399-4f49-8a03-c5005f7b7ce9","block_type":"box","text":"multiplied by the notional amount of the contract. If the Municipal Market Data AAA General Obligation Scale is above","page_number":106,"box":{"x":69,"y":377,"width":836,"height":12}},{"id":"96494d3c-f7e2-44f7-88d2-1368fbf30aa0","block_type":"box","text":"the specified level on the expiration date, a Fund will make a payment to the counterpar ty equal to the actual level","page_number":106,"box":{"x":68,"y":392,"width":816,"height":12}},{"id":"4c77eedc-d9cd-4ce3-a12d-34ab27b661fb","block_type":"box","text":"minus the specified level, multiplied by the notional amount of the contract.","page_number":106,"box":{"x":69,"y":407,"width":537,"height":12}},{"id":"c3c2ccbb-ebfb-41aa-a93d-627ca71cd6ec","block_type":"box","text":"In connection with investments in SIFMA and MMD Swaps, there is a risk that municipal yields will move in the","page_number":106,"box":{"x":102,"y":430,"width":788,"height":11}},{"id":"9d2900ba-7b4f-4af1-9b6c-5dc17749a42a","block_type":"box","text":"opposite direction than anticipated by a Fund, which would cause the Fund to make payments to its counterpar ty in","page_number":106,"box":{"x":69,"y":446,"width":821,"height":10}},{"id":"985078df-cf34-411a-9d46-c307fc52b354","block_type":"box","text":"the transaction that could adversely affect the Fund’s per formance.","page_number":106,"box":{"x":68,"y":460,"width":482,"height":12}},{"id":"976fb4c0-34ec-4cf9-90c8-69bbefbab978","block_type":"box","text":"Insured Municipal Bonds.","page_number":106,"box":{"x":102,"y":483,"width":179,"height":11}},{"id":"bb9e7d92-9663-4822-964b-01c6faab3346","block_type":"box","text":"Bonds purchased by a Fund may be covered by insurance that guarantees that interest","page_number":106,"box":{"x":288,"y":483,"width":619,"height":11}},{"id":"d564d94e-9d4d-42f0-9c03-6ce125770af1","block_type":"box","text":"payments on the bond will be made on time and the principal will be repaid when the bond matures. Either the issuer","page_number":106,"box":{"x":70,"y":498,"width":835,"height":11}},{"id":"f22c1c74-2d00-442d-affd-1b149d040e4b","block_type":"box","text":"of the bond or the Fund purchases the insurance. Insurance is expected to protect the Fund against losses caused by","page_number":106,"box":{"x":69,"y":513,"width":840,"height":12}},{"id":"6ed7efd5-1872-41d7-a8c4-5bb63c4a70fb","block_type":"box","text":"a bond issuer’s failure to make interest or principal payments. However, insurance does not protect the Fund or its","page_number":106,"box":{"x":69,"y":528,"width":818,"height":12}},{"id":"2ea99526-a76a-4756-8d67-4f49e8c90ee1","block_type":"box","text":"shareholders against losses caused by declines in a bond’s market value. Also, the Fund cannot be cer tain that any","page_number":106,"box":{"x":69,"y":544,"width":829,"height":11}},{"id":"25beeaa0-1082-4b58-a5d9-4ac213906c79","block_type":"box","text":"insurance company does not make these payments. In addition, if the Fund purchases the insurance, it may pay the","page_number":106,"box":{"x":70,"y":559,"width":827,"height":11}},{"id":"d21f9044-b780-47ce-8896-6b3aadc4c6f2","block_type":"box","text":"premiums, which will reduce the Fund’s yield. The Fund seeks to use only insurance companies with claims paying","page_number":106,"box":{"x":70,"y":574,"width":815,"height":11}},{"id":"f7837866-a389-4f83-9929-60277f0c3f40","block_type":"box","text":"ability, financial strength, or equivalent ratings of at least investment grade. However, if insurance from insurers with","page_number":106,"box":{"x":69,"y":589,"width":829,"height":11}},{"id":"9c6262cf-1bd1-4186-a3bf-6fc51778818a","block_type":"box","text":"these ratings is not available, the Fund may use insurance companies with lower ratings or stop purchasing","page_number":106,"box":{"x":68,"y":604,"width":767,"height":11}},{"id":"f347aeb2-141b-40b7-9a47-c0b4521ec680","block_type":"box","text":"insurance or insured bonds. If a bond’s insurer fails to fulfill its obligations or loses its credit rating, the value of the","page_number":106,"box":{"x":70,"y":619,"width":827,"height":11}},{"id":"d70a09d6-ce67-42da-a47a-12e5081df782","block_type":"box","text":"bond could drop.","page_number":106,"box":{"x":69,"y":634,"width":118,"height":11}},{"id":"c8ad0bea-1cb7-42db-9ac7-2abee3d572c5","block_type":"box","text":"Build America Bonds.","page_number":106,"box":{"x":102,"y":657,"width":150,"height":9}},{"id":"90f9dac6-8597-4983-9a95-511c8f6f2fe1","block_type":"box","text":"If a Fund holds Build America Bonds, the Fund may be eligible to receive a U.S. federal","page_number":106,"box":{"x":259,"y":657,"width":616,"height":11}},{"id":"d242b6c8-3c1b-49de-9987-fd0890c88032","block_type":"box","text":"income tax credit; however, the issuer of a Build America Bond may instead elect to receive a cash payment directly","page_number":106,"box":{"x":70,"y":672,"width":825,"height":11}},{"id":"0d8f08fe-7a66-4ec9-8298-d22c22046828","block_type":"box","text":"from the federal government in lieu of holders such as the fund receiving a tax credit. The interest on Build America","page_number":106,"box":{"x":68,"y":687,"width":824,"height":11}},{"id":"25106c66-1b23-45d7-84d3-e8e102614364","block_type":"box","text":"Bonds is taxable for U.S. federal income tax purposes. If the Fund does receive tax credits from Build America Bonds","page_number":106,"box":{"x":70,"y":702,"width":833,"height":11}},{"id":"0d908b09-0d43-41dc-9590-cc52adae8988","block_type":"box","text":"or other tax credit bonds on one or more specified dates during the fund’s taxable year, and the Fund satisfies the","page_number":106,"box":{"x":69,"y":717,"width":815,"height":12}},{"id":"8e483f52-2e30-499f-8d9b-b2cc4cf083f5","block_type":"box","text":"minimum distribution requirement, the Fund may elect for U.S. federal income tax purposes to pass through to","page_number":106,"box":{"x":69,"y":732,"width":788,"height":12}},{"id":"2cfbe59f-c9e7-4abc-b79e-5fa25d9b3278","block_type":"box","text":"shareholders tax credits otherwise allowable to the Fund for that year with respect to such bonds. A tax credit bond","page_number":106,"box":{"x":69,"y":748,"width":823,"height":11}},{"id":"8d909fb5-fc7c-49d3-bb08-073818c49a3a","block_type":"box","text":"is defined in the Code as a “qualified tax credit bond” (which includes a qualified forestry conservation bond, a new","page_number":106,"box":{"x":70,"y":763,"width":825,"height":11}},{"id":"86c1a21b-4c58-4db2-952f-66b094548c38","block_type":"box","text":"clean renewable energy bond, a qualified energy conservation bond, or a qualified zone academy bond, each of which","page_number":106,"box":{"x":69,"y":778,"width":837,"height":11}},{"id":"7aa6be13-d0c3-4480-9fc5-dda062fb69da","block_type":"box","text":"must meet cer tain requirements specified in the Code), a “Build America Bond” (which includes cer tain qualified","page_number":106,"box":{"x":69,"y":793,"width":802,"height":11}},{"id":"3968bfc5-1c71-4181-9faf-0888fedd5597","block_type":"box","text":"bonds issued before January 1, 2011) or cer tain other specified bonds. If the Fund were to so elect, a shareholder","page_number":106,"box":{"x":69,"y":808,"width":821,"height":11}},{"id":"a089d08f-df1d-4c2e-9a53-6c34d0af7dfe","block_type":"box","text":"would be required to include in income and would be entitled to claim as a tax credit an amount equal to a","page_number":106,"box":{"x":68,"y":823,"width":760,"height":11}},{"id":"bdd0f385-d6d7-4c8b-a2d2-8e118a3b70db","block_type":"box","text":"propor tionate share of such credits, and such amount would be subject to withholding provisions of the Code.","page_number":106,"box":{"x":70,"y":838,"width":782,"height":12}},{"id":"d02a45dc-80b1-4602-b606-0db28677126d","block_type":"box","text":"Cer tain limitations may apply on the extent to which the credit may be claimed.","page_number":106,"box":{"x":69,"y":854,"width":563,"height":11}},{"id":"e582389d-de9c-40d8-8d8b-beed5d834cf2","block_type":"box","text":"Tax-Exempt Municipal Investments.","page_number":106,"box":{"x":103,"y":876,"width":246,"height":11}},{"id":"344324ca-cb15-4563-8608-f5754a75cc05","block_type":"box","text":"Cer tain Funds may hold tax-exempt municipal investments which may be in","page_number":106,"box":{"x":355,"y":876,"width":534,"height":11}},{"id":"73db8fc5-c0c2-4107-9917-04740be92557","block_type":"box","text":"the form of tender option bonds, variable rate demand obligations, par ticipations, beneficial interests in a trust,","page_number":106,"box":{"x":68,"y":891,"width":798,"height":12}},{"id":"4b2cc0f7-5b49-4251-9ff4-8af53d798ea7","block_type":"box","text":"par tnership interests or other forms. These investments are described in greater detail above in this section. Some","page_number":106,"box":{"x":70,"y":906,"width":823,"height":12}},{"id":"31f15228-0156-4663-99fd-9188791bf61f","block_type":"box","text":"II-62","page_number":106,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3a7209c9-4f27-471a-8bff-a251b7dc7db8","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":106,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"7073dd06-3f00-4673-a257-14d02e0fd783","block_type":"box","text":"of the structures used by cer tain Funds include interests in long-term fixed-rate municipal debt obligations, held by a","page_number":107,"box":{"x":69,"y":45,"width":830,"height":11}},{"id":"f65f6e98-a8ca-47da-88bb-89539652e079","block_type":"box","text":"trustee or custodian, that are coupled with tender option, demand and other features when the tax-exempt municipal","page_number":107,"box":{"x":68,"y":60,"width":832,"height":11}},{"id":"d6629a2f-6622-4261-b1d6-405304828b56","block_type":"box","text":"investments are created. Together, these features entitle the holder of the interest to tender (or put) the underlying","page_number":107,"box":{"x":70,"y":75,"width":819,"height":11}},{"id":"60668c66-7bf6-44fa-8459-066c24575d65","block_type":"box","text":"municipal debt obligation to a third par ty at periodic intervals and to receive the principal amount thereof.","page_number":107,"box":{"x":69,"y":90,"width":752,"height":11}},{"id":"964136f8-a6bb-4321-9b0e-1b2754185424","block_type":"box","text":"In some cases, municipal debt obligations are represented by custodial receipts evidencing rights to receive","page_number":107,"box":{"x":102,"y":113,"width":770,"height":11}},{"id":"8989f9e0-1df4-4585-8b7c-892183072914","block_type":"box","text":"specific future interest payments, principal payments, or both, on the underlying securities held by the custodian.","page_number":107,"box":{"x":69,"y":128,"width":806,"height":11}},{"id":"92b9308c-28ba-43ed-86de-51de9a22f3ec","block_type":"box","text":"Under such arrangements, the holder of the custodial receipt has the option to tender the underlying securities at","page_number":107,"box":{"x":70,"y":143,"width":809,"height":11}},{"id":"aad3f5f5-1db3-4aa9-9c1b-4a4745f00cc8","block_type":"box","text":"their face value to the sponsor (","page_number":107,"box":{"x":68,"y":158,"width":228,"height":11}},{"id":"25c3475a-1cd9-42e3-a2c5-4312445a2316","block_type":"box","text":"e.g.","page_number":107,"box":{"x":297,"y":160,"width":25,"height":9}},{"id":"cbc455ed-c12a-4112-b11b-e71b63beb82a","block_type":"box","text":", a Fund, or a bank or broker-dealer or other financial institution), which is paid","page_number":107,"box":{"x":325,"y":158,"width":557,"height":11}},{"id":"8399c695-d891-4f54-a779-ebcf12c2cb8a","block_type":"box","text":"periodic fees equal to the difference between the securities’ fixed coupon rate and the rate that would cause the","page_number":107,"box":{"x":70,"y":173,"width":803,"height":11}},{"id":"52d17cbc-0d1a-413b-8788-46cd6ca6b26c","block_type":"box","text":"securities, coupled with the tender option, to trade at par on the date of a rate adjustment.","page_number":107,"box":{"x":69,"y":188,"width":648,"height":11}},{"id":"76ebb193-6940-4c98-8a58-4d00eb2221bb","block_type":"box","text":"A par ticipation interest gives the Fund an undivided interest in a Municipal Bond in the propor tion the Fund’s","page_number":107,"box":{"x":101,"y":211,"width":775,"height":11}},{"id":"a59794d1-432a-4d51-8d72-6186ddafcea4","block_type":"box","text":"par ticipation bears to the total principal amount of the Municipal Bond, and typically provides for a repurchase","page_number":107,"box":{"x":70,"y":226,"width":785,"height":11}},{"id":"62bf35e7-82ca-4884-a4c7-7d7a52ce977a","block_type":"box","text":"feature for all or any par t of the full principal amount of the par ticipation interest, plus accrued interest. Trusts and","page_number":107,"box":{"x":68,"y":241,"width":821,"height":11}},{"id":"2cf17e29-9315-4a29-b9c5-89b252e6d02a","block_type":"box","text":"par tnerships are typically used to conver t long-term fixed rate high quality bonds of a single state or municipal issuer","page_number":107,"box":{"x":70,"y":256,"width":833,"height":12}},{"id":"389b6def-a30e-4240-9a9c-658c565464f5","block_type":"box","text":"into variable or floating rate demand instruments.","page_number":107,"box":{"x":70,"y":271,"width":351,"height":12}},{"id":"28efa422-c606-48ff-99d9-a03c021bdee8","block_type":"box","text":"The Municipal Bond Funds may hold par ticipation interests and custodial receipts for municipal debt obligations","page_number":107,"box":{"x":101,"y":294,"width":797,"height":11}},{"id":"c12a82ed-2d89-4f91-847c-75ff1b495755","block_type":"box","text":"which give the holder the right to receive payment of principal subject to the conditions described above. The IRS has","page_number":107,"box":{"x":68,"y":309,"width":836,"height":11}},{"id":"73bcff2b-9f4f-4e78-9789-a7e5a2ddf64f","block_type":"box","text":"not ruled on whether the interest received on tax-exempt municipal investments in the form of par ticipation interests","page_number":107,"box":{"x":69,"y":324,"width":831,"height":11}},{"id":"e95b1e93-ccbd-474a-b97e-b3e6535acbcc","block_type":"box","text":"or custodial receipts is tax-exempt, and accordingly, purchases of any such interests or receipts are based on the","page_number":107,"box":{"x":69,"y":339,"width":809,"height":12}},{"id":"90bea385-3411-4d1a-9123-5bd4b944137e","block_type":"box","text":"opinions of counsel to the sponsors of such derivative securities. Neither a Fund nor its investment adviser or sub","page_number":107,"box":{"x":69,"y":355,"width":818,"height":11}},{"id":"b1878e14-95b2-4323-b74b-4de720c717d6","block_type":"box","text":"advisers will review the proceedings related to the creation of any tax-exempt municipal investments or the basis for","page_number":107,"box":{"x":69,"y":370,"width":828,"height":11}},{"id":"0d53ac1a-c2b2-428a-8d25-d878cef4b2a4","block_type":"box","text":"such opinions.","page_number":107,"box":{"x":69,"y":385,"width":102,"height":11}},{"id":"df9276f2-e454-425c-9ce9-92c571ea21e9","block_type":"box","text":"Operational and Technology Risks.","page_number":107,"box":{"x":102,"y":408,"width":250,"height":11}},{"id":"a75a5b26-c3c7-469f-8f4f-8a692b85e438","block_type":"box","text":"The Fund and the entities with which it interacts directly or indirectly are","page_number":107,"box":{"x":358,"y":408,"width":512,"height":11}},{"id":"50240f09-08c5-4318-936b-91949942a92a","block_type":"box","text":"susceptible to operational and technology risks, including those related to human errors, processing errors,","page_number":107,"box":{"x":69,"y":423,"width":766,"height":11}},{"id":"1ffc90be-0f9c-4cb2-88fc-1989b479c806","block_type":"box","text":"communication errors, systems failures, cybersecurity incidents, and the use of ar tificial intelligence and machine","page_number":107,"box":{"x":69,"y":438,"width":812,"height":11}},{"id":"fed51af9-dccc-415d-af64-628ea65b16bd","block_type":"box","text":"learning (“AI”), which may result in losses for the Fund and its shareholders or impair the Fund’s operations. These","page_number":107,"box":{"x":70,"y":453,"width":820,"height":11}},{"id":"fb4e5380-0e33-4ffd-965c-9ec88f5316be","block_type":"box","text":"entities include, but are not limited to, the Fund’s adviser, administrator, distributor, other service providers (e.g.,","page_number":107,"box":{"x":69,"y":468,"width":807,"height":11}},{"id":"c67ec857-9d33-4c59-807b-9c22d2dd9183","block_type":"box","text":"index and benchmark providers, accountants, custodians, and transfer agents), financial intermediaries,","page_number":107,"box":{"x":70,"y":483,"width":741,"height":11}},{"id":"1e9b0bc4-c555-44d0-a12b-0a3ce835e559","block_type":"box","text":"counterpar ties, market makers, Authorized Par ticipants, listing exchanges, other financial market operators, and","page_number":107,"box":{"x":69,"y":498,"width":802,"height":11}},{"id":"082ea0f0-c057-41e3-afdb-ff01901277ba","block_type":"box","text":"governmental authorities, as applicable. Operational and technology risks for the issuers in which the Fund invests","page_number":107,"box":{"x":68,"y":513,"width":818,"height":12}},{"id":"dbd21ed9-48cc-4756-8093-e21200403270","block_type":"box","text":"could also result in material adverse consequences for such issuers and may cause the Fund’s investments in such","page_number":107,"box":{"x":69,"y":528,"width":827,"height":12}},{"id":"16c74db8-a49c-4a9a-bc1d-565e091520b9","block_type":"box","text":"issuers to lose value. The Fund may incur substantial costs in order to mitigate operational and technology risks.","page_number":107,"box":{"x":70,"y":544,"width":803,"height":11}},{"id":"c1574ff3-ae85-4383-b8bc-9925ff92c6bb","block_type":"box","text":"Cybersecurity incidents can result from deliberate attacks or unintentional events against an issuer in which the","page_number":107,"box":{"x":102,"y":566,"width":796,"height":11}},{"id":"e0a24fc3-a96f-4fcd-8896-119b0f9ac710","block_type":"box","text":"Fund invests, the Fund or any of its service providers. They include, but are not limited to, gaining unauthorized","page_number":107,"box":{"x":70,"y":581,"width":790,"height":12}},{"id":"c216f85e-7700-45e7-ac1b-e6e5338dad6d","block_type":"box","text":"access to systems, misappropriating assets or sensitive information, corrupting or destroying data, and causing","page_number":107,"box":{"x":69,"y":596,"width":800,"height":12}},{"id":"1da1519f-bf4c-4bea-ae76-0c9c506807e5","block_type":"box","text":"operational disruption. Geopolitical tension may increase the scale and sophistication of deliberate attacks,","page_number":107,"box":{"x":69,"y":612,"width":768,"height":11}},{"id":"378689ec-ec99-45b1-9680-62294384ce0e","block_type":"box","text":"par ticularly those from nation states or from entities with nation state backing. Cybersecurity incidents may result in","page_number":107,"box":{"x":70,"y":627,"width":827,"height":11}},{"id":"c33e829b-ede5-4418-a67a-48fc6d7c4fd2","block_type":"box","text":"any of the following: financial losses; inter ference with the Fund’s ability to calculate its NAV; disclosure of","page_number":107,"box":{"x":69,"y":642,"width":760,"height":11}},{"id":"49ac6b00-5530-4d2c-8a5d-42d0549047dd","block_type":"box","text":"confidential information; impediments to trading; submission of erroneous trades by the Fund or erroneous","page_number":107,"box":{"x":69,"y":657,"width":763,"height":11}},{"id":"70b220a5-7ded-4474-aa7f-e7e910b6a45c","block_type":"box","text":"subscription or redemption orders; the inability of the Fund or its service providers to transact business; violations of","page_number":107,"box":{"x":69,"y":672,"width":835,"height":11}},{"id":"23a6ef95-1cd7-4a4c-addc-3c4f830f8b25","block_type":"box","text":"applicable privacy and other laws; regulatory fines; penalties; reputational damage; reimbursement or other","page_number":107,"box":{"x":69,"y":687,"width":766,"height":11}},{"id":"307d3cc7-eabe-4177-bbcd-05b1b072e982","block_type":"box","text":"compensation costs; and other legal and compliance expenses. Fur thermore, cybersecurity incidents may render","page_number":107,"box":{"x":69,"y":703,"width":804,"height":11}},{"id":"9b25bea1-829c-4a5f-8a5c-964181939a8e","block_type":"box","text":"records of the Fund, including records relating to its assets and transactions, shareholder ownership of Fund shares,","page_number":107,"box":{"x":69,"y":717,"width":833,"height":12}},{"id":"fecefd42-3d47-4562-b3b0-4f8caaba61a3","block_type":"box","text":"and other data integral to the Fund’s functioning, inaccessible, inaccurate or incomplete. Power outages, natural","page_number":107,"box":{"x":69,"y":732,"width":800,"height":12}},{"id":"a33d8d3d-6141-48c7-b549-54579cc40720","block_type":"box","text":"disasters, equipment malfunctions and processing errors that threaten information and technology systems relied","page_number":107,"box":{"x":69,"y":748,"width":812,"height":11}},{"id":"2e16fb6f-59fc-4747-a0eb-65911368a84b","block_type":"box","text":"upon by the Fund or its service providers, as well as market events that occur at a pace that overloads these","page_number":107,"box":{"x":69,"y":763,"width":777,"height":11}},{"id":"4d5891d6-90bc-4c30-9b02-04d2407021e4","block_type":"box","text":"systems, may also disrupt business operations or impact critical data. Recent advances in AI technology pose risks","page_number":107,"box":{"x":69,"y":778,"width":824,"height":11}},{"id":"8e9763b5-d653-4dac-8ae0-061757b5a55a","block_type":"box","text":"to the Fund and its por tfolio investments. These advancements could harm the Fund and its por tfolio investments by","page_number":107,"box":{"x":68,"y":793,"width":836,"height":11}},{"id":"cc95338d-eee6-4a63-9654-9373a1c38824","block_type":"box","text":"reducing the demand for both the technology and software offerings of the Fund’s por tfolio investments. Additionally,","page_number":107,"box":{"x":69,"y":808,"width":833,"height":11}},{"id":"a4c98ffa-0f2e-496c-a891-e7fceb3d7239","block_type":"box","text":"these advancements could significantly disrupt the Fund’s por tfolio investments and subject them to increased","page_number":107,"box":{"x":68,"y":823,"width":793,"height":12}},{"id":"b8fe900d-5d74-4adb-9c62-90a10c75a336","block_type":"box","text":"competition, which could have a material adverse effect on business, financial condition, and results of operations.","page_number":107,"box":{"x":69,"y":838,"width":822,"height":11}},{"id":"1517dbae-e328-4428-9758-517b2d993ca6","block_type":"box","text":"AI technology advancements, including efficiency improvements, without related increases in the adoption and","page_number":107,"box":{"x":68,"y":853,"width":787,"height":12}},{"id":"73a5d232-c285-4a91-ae94-b92b6e217d62","block_type":"box","text":"development of such technologies, could also negatively impact demand for, and the valuation of, digital","page_number":107,"box":{"x":69,"y":869,"width":742,"height":11}},{"id":"695fff56-429b-4f1c-a992-8f194de827bf","block_type":"box","text":"infrastructure assets.","page_number":107,"box":{"x":70,"y":884,"width":151,"height":9}},{"id":"56521a6b-c6c3-4635-bff2-81e16c71307d","block_type":"box","text":"II-63","page_number":107,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3ab4bae4-608d-4a54-a22b-106b67916c3e","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":107,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"dfb7c16d-d100-4293-83d7-a4a96e11782a","block_type":"box","text":"The Fund and its por tfolio investments could be exposed to the risks of AI technology if third-par ty service","page_number":108,"box":{"x":101,"y":45,"width":755,"height":11}},{"id":"84d94602-b9ae-42a7-ad2a-8d0357f3b9a7","block_type":"box","text":"providers or any counterpar ties, whether or not known to the Fund, also use AI technology in their business activities.","page_number":108,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"9214aee8-128e-4d1f-b64c-2f4d890c579b","block_type":"box","text":"The Fund and its service providers may not be in a position to control the use of AI technology in third-par ty products","page_number":108,"box":{"x":68,"y":75,"width":833,"height":11}},{"id":"0e6ccd53-1d0f-4367-96cb-2eaf13a107c4","block_type":"box","text":"or services.","page_number":108,"box":{"x":69,"y":90,"width":82,"height":9}},{"id":"b93baa26-364b-4220-8b90-81fc4bc91ba2","block_type":"box","text":"Use of AI technology could include the input of confidential information in contravention of applicable policies,","page_number":108,"box":{"x":102,"y":113,"width":781,"height":11}},{"id":"b3e5416e-53c1-4865-8a8c-1bd88af9c837","block_type":"box","text":"contractual or other obligations or restrictions, resulting in such confidential information becoming accessible by","page_number":108,"box":{"x":69,"y":128,"width":801,"height":11}},{"id":"f635e63d-7a44-4943-9a20-f4b27206cf78","block_type":"box","text":"other third-par ty AI technology applications and users.","page_number":108,"box":{"x":69,"y":143,"width":383,"height":11}},{"id":"97516bbd-4030-40fa-89b9-c51fed77b8e4","block_type":"box","text":"Independent of its context of use, AI technology is generally highly reliant on the collection and analysis of large","page_number":108,"box":{"x":102,"y":166,"width":795,"height":11}},{"id":"f15d1b8f-a632-47a2-bc04-b12d96930cfa","block_type":"box","text":"amounts of data, may incorporate biased or inaccurate data, and it is not possible or practicable to incorporate all","page_number":108,"box":{"x":69,"y":181,"width":813,"height":11}},{"id":"f344c273-2eae-41ba-b1cc-dbce1735a970","block_type":"box","text":"relevant data into the models that AI technology utilizes to operate. Cer tain data in such models will inevitably","page_number":108,"box":{"x":69,"y":196,"width":785,"height":11}},{"id":"70a4d9e5-11f2-4058-a2ca-c35056dfcce7","block_type":"box","text":"contain a degree of inaccuracy and error, or could otherwise be inadequate or flawed, which would be likely to","page_number":108,"box":{"x":69,"y":211,"width":782,"height":11}},{"id":"fb8946fa-5981-4cfd-805d-e529bde8a652","block_type":"box","text":"degrade the effectiveness of AI technology. The output or results of any such AI technologies may therefore be","page_number":108,"box":{"x":69,"y":226,"width":787,"height":11}},{"id":"4fa98b99-e26e-47e8-b64d-a5ac9c8efad6","block_type":"box","text":"incomplete, erroneous, distor ted, or misleading. Fur ther, AI tools may lack transparency as to how data is utilized","page_number":108,"box":{"x":70,"y":241,"width":809,"height":11}},{"id":"ea69a9b3-38ba-4033-98be-bef2b0c46e6a","block_type":"box","text":"and how outputs are generated. AI technologies may also allow the unintended introduction of vulnerabilities into","page_number":108,"box":{"x":69,"y":256,"width":805,"height":12}},{"id":"6558bc2e-fcc7-48bf-8304-9a39383c5675","block_type":"box","text":"infrastructures and applications. To the extent that the Fund or its por tfolio investments are exposed to the risks of","page_number":108,"box":{"x":70,"y":271,"width":822,"height":11}},{"id":"885b5df1-9408-456e-9651-de8d9b73750d","block_type":"box","text":"AI technology use, any such inaccuracies or errors could have adverse impacts on the Fund or its investments.","page_number":108,"box":{"x":68,"y":287,"width":789,"height":11}},{"id":"df27acb5-412c-4c54-8501-c8c287ad015b","block_type":"box","text":"Regulations related to AI technology could also impose cer tain obligations and costs related to monitoring and","page_number":108,"box":{"x":102,"y":309,"width":786,"height":11}},{"id":"107dc046-0ad0-4e3f-b0f8-170c0f7f8762","block_type":"box","text":"compliance. For example, in April 2023, the Federal Trade Commission, U.S. Depar tment of Justice, Consumer","page_number":108,"box":{"x":69,"y":324,"width":791,"height":11}},{"id":"7c74cf1b-f11c-4222-9431-89c6ad46632a","block_type":"box","text":"Financial Protection Bureau, and U.S. Equal Employment Oppor tunity Commission released a joint statement on","page_number":108,"box":{"x":70,"y":340,"width":796,"height":11}},{"id":"6022d26c-7bd1-46fe-86bb-fc403fd15bee","block_type":"box","text":"ar tificial intelligence demonstrating interest in monitoring the development and use of automated systems and","page_number":108,"box":{"x":69,"y":355,"width":788,"height":11}},{"id":"f1b4d202-f596-4b70-a3a4-5c11033fd110","block_type":"box","text":"enforcement of their respective laws and regulations. In October 2023, an executive order established new standards","page_number":108,"box":{"x":69,"y":370,"width":839,"height":11}},{"id":"8631553b-6818-4da2-b899-9b209c313793","block_type":"box","text":"for AI safety and security. In addition to the U.S. regulatory framework, in 2024, the EU adopted the Ar tificial","page_number":108,"box":{"x":68,"y":385,"width":773,"height":11}},{"id":"32e36659-4e4f-4ae9-9286-866a8f31dd2b","block_type":"box","text":"Intelligence Act, which applies to cer tain AI technology and the data used to train, test, and deploy them, which may","page_number":108,"box":{"x":70,"y":400,"width":826,"height":11}},{"id":"28c009eb-3338-4eb6-bbc7-5e8f4a5d7472","block_type":"box","text":"create additional compliance burdens, higher administrative costs, and significant penalties should the Fund, the","page_number":108,"box":{"x":69,"y":415,"width":805,"height":11}},{"id":"c05a8393-c7bd-4029-a9c6-36397902d983","block_type":"box","text":"adviser, or the Fund’s por tfolio investments fail to comply.","page_number":108,"box":{"x":69,"y":430,"width":412,"height":11}},{"id":"37fb1a03-a2a2-4026-a354-06c5c02ee0b9","block_type":"box","text":"AI technology and its applications, including in the investment and financial sectors, continue to develop rapidly,","page_number":108,"box":{"x":101,"y":453,"width":797,"height":11}},{"id":"ccd868dd-8430-4833-8a48-86f8358b4181","block_type":"box","text":"and it is impossible to predict the future risks that may arise from such developments. The full extent of current or","page_number":108,"box":{"x":69,"y":468,"width":817,"height":11}},{"id":"245eff43-ee7a-4a21-a85d-c3febf8db066","block_type":"box","text":"future risks related thereto is not possible to predict, and the Fund may not be able to anticipate, prevent, mitigate,","page_number":108,"box":{"x":68,"y":483,"width":824,"height":11}},{"id":"2d5e9b20-a1a3-4b77-98e5-90dbc5e1e123","block_type":"box","text":"or remediate all of the potential risks, challenges, or impacts of such changes.","page_number":108,"box":{"x":69,"y":498,"width":561,"height":11}},{"id":"b651a8bb-d331-4e81-ac3b-596f87a9cea2","block_type":"box","text":"While the Fund’s service providers are required to have appropriate operational, information security and","page_number":108,"box":{"x":101,"y":521,"width":747,"height":11}},{"id":"498d8c2f-7999-4120-b729-739289219c52","block_type":"box","text":"cybersecurity risk management policies and procedures, their methods of risk management may differ from those of","page_number":108,"box":{"x":69,"y":536,"width":830,"height":11}},{"id":"767a08a6-67b5-4f32-9205-ba0763f6eb5c","block_type":"box","text":"the Fund in the setting of priorities, the personnel and resources available or the effectiveness of relevant controls.","page_number":108,"box":{"x":68,"y":551,"width":823,"height":11}},{"id":"48f3c2c9-ab82-4613-b950-082ce972900a","block_type":"box","text":"The Fund and its adviser seek to reduce these risks through controls, procedures and oversight, including","page_number":108,"box":{"x":68,"y":566,"width":755,"height":11}},{"id":"617c37e5-45be-4dd0-bf53-7b25d17d1a29","block_type":"box","text":"establishing business continuity plans and risk management systems. However, there are inherent limitations in such","page_number":108,"box":{"x":69,"y":582,"width":838,"height":11}},{"id":"502ba337-9baa-40ce-887e-0a50eb89190d","block_type":"box","text":"plans and systems, including the possibility that cer tain risks that may affect the Fund have not been identified or","page_number":108,"box":{"x":70,"y":596,"width":812,"height":12}},{"id":"a18d8105-19db-442d-9dfe-221211dc6211","block_type":"box","text":"may emerge in the future; that such plans and systems may not completely eliminate the occurrence or mitigate the","page_number":108,"box":{"x":69,"y":612,"width":828,"height":11}},{"id":"6afe610c-6155-4c23-b183-1883f52de630","block_type":"box","text":"effects of operational or information security disruptions or failures or of cybersecurity incidents; or that prevention","page_number":108,"box":{"x":69,"y":627,"width":819,"height":11}},{"id":"99da8bff-29ce-405e-aaa1-45ee42ae846e","block_type":"box","text":"and remediation effor ts will not be successful or that incidents will go undetected. The Fund cannot control the","page_number":108,"box":{"x":69,"y":642,"width":792,"height":11}},{"id":"7030e76a-4f7a-4510-8d2c-5f91200f8166","block_type":"box","text":"systems, information security or other cybersecurity of the issuers in which it invests or its service providers,","page_number":108,"box":{"x":69,"y":657,"width":775,"height":11}},{"id":"1ebdbe61-a5ef-40aa-bf55-38824a2ce763","block_type":"box","text":"counterpar ties, and other third par ties whose activities affect the Fund.","page_number":108,"box":{"x":69,"y":672,"width":510,"height":11}},{"id":"c96b537b-de2b-4616-b13f-7e0f4dab4adc","block_type":"box","text":"Lastly, the regulatory climate governing cybersecurity and data protection is developing quickly and may vary","page_number":108,"box":{"x":102,"y":695,"width":771,"height":11}},{"id":"24dae0d5-95e2-47de-8c37-afb92b619ca9","block_type":"box","text":"considerably across jurisdictions. Regulators continue to develop new rules and standards related to cybersecurity","page_number":108,"box":{"x":69,"y":710,"width":816,"height":11}},{"id":"f24da16a-920a-42b1-84c9-6df363dd3e44","block_type":"box","text":"and data protection. Compliance with evolving regulations can be demanding and costly, requiring substantial","page_number":108,"box":{"x":69,"y":725,"width":778,"height":11}},{"id":"fbd4b7f9-4f02-4821-9047-28a7dc817bf4","block_type":"box","text":"resources to monitor and implement required changes.","page_number":108,"box":{"x":69,"y":740,"width":391,"height":11}},{"id":"05ce7035-6048-4386-8a41-8210acc7bbb7","block_type":"box","text":"Participation Notes.","page_number":108,"box":{"x":102,"y":763,"width":145,"height":11}},{"id":"1f2417d5-f65a-423d-aad6-71f2787efd46","block_type":"box","text":"A Fund may buy par ticipation notes from a bank or broker-dealer (“issuer”) that entitle the","page_number":108,"box":{"x":253,"y":763,"width":641,"height":11}},{"id":"0e6b4a92-1030-48d0-96ec-0bafdba1b315","block_type":"box","text":"Fund to a return measured by the change in value of an identified underlying security or basket of securities","page_number":108,"box":{"x":70,"y":778,"width":766,"height":11}},{"id":"964105a0-007a-4b45-a901-cbb5d62fcc79","block_type":"box","text":"(collectively, the “underlying security”). Par ticipation notes are typically used when a direct investment in the","page_number":108,"box":{"x":69,"y":793,"width":772,"height":11}},{"id":"25103f57-f314-4db0-921c-f02a74e877fa","block_type":"box","text":"underlying security is restricted due to country-specific regulations.","page_number":108,"box":{"x":69,"y":808,"width":475,"height":11}},{"id":"32c56c74-7901-4ec6-b214-8a5832d063ea","block_type":"box","text":"The Fund is subject to counterpar ty risk associated with each issuer. Investment in a par ticipation note is not","page_number":108,"box":{"x":101,"y":831,"width":782,"height":11}},{"id":"f1e8bb9d-41a7-4bbb-9b69-a61fca830759","block_type":"box","text":"the same as investment in the constituent shares of the company. A par ticipation note represents only an obligation","page_number":108,"box":{"x":68,"y":846,"width":831,"height":11}},{"id":"423cfaf0-aa63-4f2c-829b-fdcc53361721","block_type":"box","text":"of the issuer to provide the Fund the economic per formance equivalent to holding shares of an underlying security. A","page_number":108,"box":{"x":69,"y":861,"width":831,"height":11}},{"id":"41e65325-4b77-4155-acc6-ead177d8aa00","block_type":"box","text":"par ticipation note does not provide any beneficial or equitable entitlement or interest in the relevant underlying","page_number":108,"box":{"x":70,"y":876,"width":789,"height":11}},{"id":"a31dd4dd-3884-4679-b6ce-946b0f625964","block_type":"box","text":"security. In other words, shares of the underlying security are not in any way owned by the Fund. However, each","page_number":108,"box":{"x":69,"y":891,"width":791,"height":12}},{"id":"22c7c57b-0f2e-40be-b813-f9a4d32f0a42","block_type":"box","text":"par ticipation note synthetically replicates the economic benefit of holding shares in the underlying security. Because","page_number":108,"box":{"x":70,"y":906,"width":827,"height":12}},{"id":"09a017ea-01c2-4891-b89e-e2b6e0201ba9","block_type":"box","text":"II-64","page_number":108,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"239537e1-c280-4e10-a1dc-067902971d13","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":108,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"7b2b4f5c-5c5f-49c0-90d9-7e71449d50f6","block_type":"box","text":"a par ticipation note is an obligation of the issuer, rather than a direct investment in shares of the underlying security,","page_number":109,"box":{"x":69,"y":45,"width":834,"height":11}},{"id":"059ff071-fa15-454f-b3d3-01cdbb23d999","block_type":"box","text":"a Fund may suffer losses potentially equal to the full value of the par ticipation note if the issuer fails to per form its","page_number":109,"box":{"x":69,"y":60,"width":822,"height":11}},{"id":"2a19a760-6277-416b-9925-d537a78b65a4","block_type":"box","text":"obligations. A Fund attempts to mitigate that risk by purchasing only from issuers determined to be creditwor thy.","page_number":109,"box":{"x":69,"y":75,"width":801,"height":11}},{"id":"488ccbee-5633-4d56-aff1-a287c5c6324d","block_type":"box","text":"The counterpar ty may, but is not required to, purchase the shares of the underlying security to hedge its","page_number":109,"box":{"x":101,"y":98,"width":743,"height":11}},{"id":"5c94611b-33dc-4da9-b70d-36b4dd721e1b","block_type":"box","text":"obligation. A Fund may, but is not required to, purchase credit protection against the default of the issuer. When the","page_number":109,"box":{"x":69,"y":113,"width":826,"height":11}},{"id":"b08da274-2e4a-43ba-ba55-8b068396e184","block_type":"box","text":"par ticipation note expires or a Fund exercises the par ticipation note and closes its position, the Fund receives a","page_number":109,"box":{"x":70,"y":128,"width":799,"height":11}},{"id":"7ca3635e-eeae-4293-9d88-fdc385697305","block_type":"box","text":"payment that is based upon the then-current value of the underlying security conver ted into U.S. dollars (less","page_number":109,"box":{"x":70,"y":143,"width":776,"height":11}},{"id":"6c665d2f-a15e-477a-8ff4-1f1fef230fbb","block_type":"box","text":"transaction costs). The price, per formance and liquidity of a par ticipation note are all linked directly to the underlying","page_number":109,"box":{"x":68,"y":158,"width":834,"height":11}},{"id":"557812b7-965a-4c88-92e0-89e938b651c1","block_type":"box","text":"security. A Fund’s ability to redeem or exercise a par ticipation note generally is dependent on the liquidity in the local","page_number":109,"box":{"x":69,"y":173,"width":834,"height":11}},{"id":"92bf49d6-3705-4721-85d8-94258cbb4be3","block_type":"box","text":"trading market for the security underlying the par ticipation note.","page_number":109,"box":{"x":68,"y":188,"width":454,"height":12}},{"id":"1436f988-adbd-4293-b2c8-9c6a379be676","block_type":"box","text":"Portfolio Turnover Rates.","page_number":109,"box":{"x":102,"y":211,"width":181,"height":9}},{"id":"cc324a3e-9be2-411a-afd0-556074bf10e9","block_type":"box","text":"A Fund’s annual por tfolio turnover rate will not be a factor preventing a sale or","page_number":109,"box":{"x":289,"y":211,"width":558,"height":11}},{"id":"b02bc88d-d314-4590-8be1-1a69944ca092","block_type":"box","text":"purchase when the Manager believes investment considerations warrant such sale or purchase. Although cer tain","page_number":109,"box":{"x":70,"y":226,"width":804,"height":11}},{"id":"0ce2f23a-d086-4531-9585-934d2acdffb0","block_type":"box","text":"Funds will use an approach to investing that is largely a passive, indexing approach, such Funds may engage in a","page_number":109,"box":{"x":70,"y":241,"width":806,"height":11}},{"id":"b1030fdc-87b1-4a31-97c3-f8b5e177b7ad","block_type":"box","text":"substantial number of por tfolio transactions. With respect to these Funds, the rate of por tfolio turnover will be a","page_number":109,"box":{"x":69,"y":256,"width":800,"height":11}},{"id":"9a3f85a3-16f0-430f-a295-442f3a9bbe6d","block_type":"box","text":"limiting factor when the Manager considers whether to purchase or sell securities for a Fund only to the extent that","page_number":109,"box":{"x":70,"y":271,"width":818,"height":12}},{"id":"ba872468-5f67-4b0b-a434-46a8fad89cc0","block_type":"box","text":"the Manager will consider the impact of transaction costs on a Fund’s tracking error. Por tfolio turnover may vary","page_number":109,"box":{"x":68,"y":286,"width":800,"height":12}},{"id":"e3ecfec4-42a1-4e36-a889-9c2ed3a17581","block_type":"box","text":"greatly from year to year as well as within a par ticular year. High por tfolio turnover (","page_number":109,"box":{"x":68,"y":302,"width":595,"height":11}},{"id":"508d0bfc-bf79-46bb-b66d-333f1aa610ca","block_type":"box","text":"i.e.","page_number":109,"box":{"x":665,"y":302,"width":20,"height":9}},{"id":"e4507e24-fb07-46d1-af97-8c325aa9e10e","block_type":"box","text":", 100% or more) may result in","page_number":109,"box":{"x":687,"y":302,"width":210,"height":11}},{"id":"71fb8c5c-edb0-4de8-81fd-6450526b835b","block_type":"box","text":"increased transaction costs to a Fund, including brokerage commissions, dealer mark-ups and other transaction","page_number":109,"box":{"x":70,"y":317,"width":797,"height":11}},{"id":"1436fa4c-91e6-497d-b557-31ff1e8e1918","block_type":"box","text":"costs on the sale of the securities and reinvestment in other securities. The sale of a Fund’s securities may result in","page_number":109,"box":{"x":69,"y":332,"width":832,"height":11}},{"id":"8d8c7d1e-8ada-4015-a85c-79616d6b184f","block_type":"box","text":"the recognition of capital gain or loss. Given the frequency of sales, such gain or loss will likely be shor t-term capital","page_number":109,"box":{"x":68,"y":347,"width":831,"height":11}},{"id":"c41b9079-e227-45bd-9472-7598a9fcc34a","block_type":"box","text":"gain or loss. These effects of higher than normal por tfolio turnover may adversely affect a Fund’s per formance.","page_number":109,"box":{"x":68,"y":362,"width":795,"height":11}},{"id":"47e98bdc-8bfa-467b-9174-ed4e6e5ac129","block_type":"box","text":"Preferred Stock.","page_number":109,"box":{"x":102,"y":385,"width":118,"height":9}},{"id":"79ced9e3-819b-4bcc-bb07-2daaa8f93e45","block_type":"box","text":"Cer tain Funds may invest in preferred stocks. Preferred stock has a preference over common","page_number":109,"box":{"x":226,"y":385,"width":665,"height":11}},{"id":"50afbefe-c195-4af6-b8c5-1f9193e2a96c","block_type":"box","text":"stock in liquidation (and generally dividends as well) but is subordinated to bond holders and other creditors in all","page_number":109,"box":{"x":69,"y":400,"width":808,"height":11}},{"id":"f230d076-3ebb-4efa-b0b9-69224ed01c33","block_type":"box","text":"respects. As a general rule, the market value of preferred stock with a fixed dividend rate and no conversion element","page_number":109,"box":{"x":69,"y":415,"width":834,"height":11}},{"id":"79144dd9-9196-4cc3-b826-554c47bf89a8","block_type":"box","text":"varies inversely with interest rates and perceived credit risk, while the market price of conver tible preferred stock","page_number":109,"box":{"x":68,"y":430,"width":808,"height":11}},{"id":"ca6e4165-87df-4299-b74d-df2815a6853d","block_type":"box","text":"generally also reflects some element of conversion value. Because preferred stock is junior to debt securities and","page_number":109,"box":{"x":68,"y":445,"width":813,"height":12}},{"id":"b4bc8505-f05e-4071-945a-83758b41d0ca","block_type":"box","text":"other obligations of the issuer, deterioration in the credit quality of the issuer will cause greater changes in the value","page_number":109,"box":{"x":69,"y":460,"width":831,"height":12}},{"id":"884c4775-ca7f-4dd8-8549-20617be2ed13","block_type":"box","text":"of a preferred stock than in a more senior debt security with similar stated yield characteristics. Unlike interest","page_number":109,"box":{"x":69,"y":475,"width":791,"height":12}},{"id":"f17a379b-f618-46cd-a2a4-53485c9b8177","block_type":"box","text":"payments on debt securities, preferred stock dividends are payable only if declared by the issuer’s board of directors.","page_number":109,"box":{"x":70,"y":491,"width":838,"height":11}},{"id":"77ce2408-6126-48b5-9b1b-6dbbd40e5f6d","block_type":"box","text":"Preferred stock also may be subject to optional or mandatory redemption provisions.","page_number":109,"box":{"x":69,"y":506,"width":604,"height":11}},{"id":"ea5b34f1-9ea9-49e2-93db-fbffbe2c5f0e","block_type":"box","text":"Tax-Exempt Preferred Shares.","page_number":109,"box":{"x":103,"y":528,"width":207,"height":11}},{"id":"39305dc0-1d80-48a7-95b4-5b97310912fa","block_type":"box","text":"Cer tain Funds may invest in preferred interests of other investment funds that pay","page_number":109,"box":{"x":316,"y":528,"width":588,"height":12}},{"id":"3e4b2342-2c01-47ec-86df-0b95a74dc3ad","block_type":"box","text":"dividends that are exempt from regular U.S. federal income tax. Such funds in turn invest in municipal bonds and","page_number":109,"box":{"x":69,"y":543,"width":806,"height":12}},{"id":"63825772-d0d2-4b50-a691-989454e81ef9","block_type":"box","text":"other assets that pay interest or make distributions that are exempt from regular U.S. federal income tax, such as","page_number":109,"box":{"x":69,"y":559,"width":814,"height":11}},{"id":"7edd30d0-c6ba-4c5f-bbdf-cfdfa6cad869","block_type":"box","text":"revenue bonds issued by state or local agencies to fund the development of low-income, multi-family housing.","page_number":109,"box":{"x":69,"y":574,"width":780,"height":11}},{"id":"88959399-920b-4726-819f-0554fc79bf76","block_type":"box","text":"Investment in such tax-exempt preferred shares involves many of the same issues as investing in other investment","page_number":109,"box":{"x":70,"y":589,"width":820,"height":11}},{"id":"bcaeceba-e3bb-438b-a0fd-d9325fd4d80a","block_type":"box","text":"companies. These investments also have additional risks, including illiquid investments risk, the absence of","page_number":109,"box":{"x":69,"y":604,"width":772,"height":11}},{"id":"a83b3331-41d3-4c1f-80d2-f478d4f7f392","block_type":"box","text":"regulation governing investment practices, capital structure and leverage, affiliated transactions and other matters,","page_number":109,"box":{"x":69,"y":619,"width":821,"height":11}},{"id":"b106bf9c-c981-4fc5-b2e2-32d9fc651733","block_type":"box","text":"and concentration of investments in par ticular issuers or industries. The Municipal Bond Funds will treat investments","page_number":109,"box":{"x":69,"y":634,"width":834,"height":11}},{"id":"9f99aeb8-7e53-41a0-94a7-d03ea4761212","block_type":"box","text":"in tax-exempt preferred shares as investments in municipal bonds.","page_number":109,"box":{"x":70,"y":649,"width":474,"height":11}},{"id":"a4d54bed-ba66-4717-96b3-9de71e423856","block_type":"box","text":"Trust Preferred Securities.","page_number":109,"box":{"x":103,"y":672,"width":184,"height":9}},{"id":"bf95b7e2-5563-405e-a50a-95e1e07044d4","block_type":"box","text":"Cer tain Funds may invest in trust preferred securities. Trust preferred securities are","page_number":109,"box":{"x":294,"y":672,"width":599,"height":11}},{"id":"ae8789af-0a2c-47a4-a2de-3a388df2069e","block_type":"box","text":"typically issued by corporations, generally in the form of interest bearing notes with preferred securities","page_number":109,"box":{"x":68,"y":687,"width":737,"height":11}},{"id":"a8c542b8-b595-42f6-9a65-96b07f469e4b","block_type":"box","text":"characteristics, or by an affiliated business trust of a corporation, generally in the form of beneficial interests in","page_number":109,"box":{"x":69,"y":702,"width":796,"height":12}},{"id":"6e0e9d5f-7269-418b-b91e-6534cdd507c0","block_type":"box","text":"subordinated debentures or similarly structured securities. The trust preferred securities market consists of both","page_number":109,"box":{"x":69,"y":717,"width":805,"height":12}},{"id":"7fd18ccf-eded-41ef-b9da-fa231550ecb4","block_type":"box","text":"fixed and adjustable coupon rate securities that are either perpetual in nature or have stated maturity dates.","page_number":109,"box":{"x":68,"y":732,"width":773,"height":12}},{"id":"6fc49e34-12fa-48c0-9277-31370c0870f5","block_type":"box","text":"Trust preferred securities are typically junior and fully subordinated liabilities of an issuer and benefit from a","page_number":109,"box":{"x":101,"y":755,"width":770,"height":11}},{"id":"dffafaf3-3836-4812-aa0e-8a432fd9d5d2","block_type":"box","text":"guarantee that is junior and fully subordinated to the other liabilities of the guarantor. In addition, trust preferred","page_number":109,"box":{"x":68,"y":770,"width":801,"height":12}},{"id":"ce7a903f-a26f-478a-a991-6cd8c2c1de2f","block_type":"box","text":"securities typically permit an issuer to defer the payment of income for five years or more without triggering an event","page_number":109,"box":{"x":69,"y":785,"width":830,"height":12}},{"id":"1923a2c4-9f99-4ef0-aa26-c7434a4f3a27","block_type":"box","text":"of default. Because of their subordinated position in the capital structure of an issuer, the ability to defer payments","page_number":109,"box":{"x":69,"y":801,"width":822,"height":11}},{"id":"414fe231-36b2-4d4c-9603-f1ae8caf4437","block_type":"box","text":"for extended periods of time without default consequences to the issuer, and cer tain other features (such as","page_number":109,"box":{"x":68,"y":816,"width":777,"height":11}},{"id":"4d57e4d7-7d44-4fae-8ac0-2e4337cf1f0b","block_type":"box","text":"restrictions on common dividend payments by the issuer or ultimate guarantor when full cumulative payments on the","page_number":109,"box":{"x":69,"y":831,"width":831,"height":11}},{"id":"634a7364-2eb3-4ed4-a639-7651869bc616","block_type":"box","text":"trust preferred securities have not been made), these trust preferred securities are often treated as close","page_number":109,"box":{"x":68,"y":846,"width":757,"height":11}},{"id":"3bebf5bf-e517-4d24-8afa-c471b37faa19","block_type":"box","text":"substitutes for traditional preferred securities, both by issuers and investors.","page_number":109,"box":{"x":69,"y":861,"width":548,"height":11}},{"id":"f12adfb6-c816-4561-8311-35e9edc62a6e","block_type":"box","text":"Trust preferred securities include but are not limited to trust originated preferred securities (“TOPRS","page_number":109,"box":{"x":101,"y":884,"width":715,"height":11}},{"id":"9969f826-0f14-4db7-8db0-aea0609ae93f","block_type":"box","text":"®","page_number":109,"box":{"x":817,"y":884,"width":5,"height":5}},{"id":"dfcd6d6e-e070-4f33-8488-442a1e85c247","block_type":"box","text":"”); monthly","page_number":109,"box":{"x":824,"y":884,"width":77,"height":11}},{"id":"60c422f3-a595-4510-8ebd-b0d4a1dc532c","block_type":"box","text":"income preferred securities (“MIPS","page_number":109,"box":{"x":70,"y":899,"width":248,"height":11}},{"id":"651a7c10-ecd2-475a-9e4f-602f1280a45d","block_type":"box","text":"®","page_number":109,"box":{"x":319,"y":899,"width":6,"height":5}},{"id":"7b794507-5f86-4737-b095-43d1585010d5","block_type":"box","text":"”); quar terly income bond securities (“QUIBS","page_number":109,"box":{"x":326,"y":899,"width":317,"height":11}},{"id":"bbae6207-84eb-4064-b872-c8585fa49162","block_type":"box","text":"®","page_number":109,"box":{"x":644,"y":899,"width":6,"height":5}},{"id":"0c524814-589e-4572-970a-3a167c4f5fc9","block_type":"box","text":"” ); quar terly income debt securities","page_number":109,"box":{"x":652,"y":899,"width":255,"height":11}},{"id":"9c98ad6b-3ebd-4eb8-9990-6a06fd247fab","block_type":"box","text":"II-65","page_number":109,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"b2245bac-9adc-498d-a1a0-f63e21cfd0aa","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":109,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"e25a99e6-5e85-474b-98d6-ad063a41fdff","block_type":"box","text":"(“QUIDS","page_number":110,"box":{"x":69,"y":45,"width":57,"height":11}},{"id":"a5255f9a-6262-4373-a2bc-e091da6b587b","block_type":"box","text":"®","page_number":110,"box":{"x":127,"y":45,"width":6,"height":4}},{"id":"49db0426-545c-4f80-b65d-48d0f1f2d3f2","block_type":"box","text":"”); quar terly income preferred securities (“QUIPS","page_number":110,"box":{"x":135,"y":45,"width":346,"height":11}},{"id":"2cd0621c-027d-46cc-a888-8f8f80140dff","block_type":"box","text":"SM","page_number":110,"box":{"x":482,"y":45,"width":11,"height":4}},{"id":"1662cca7-ee44-418e-b321-05678317d62e","block_type":"box","text":"”); corporate trust securities (“CORTS","page_number":110,"box":{"x":495,"y":45,"width":267,"height":11}},{"id":"87a5bc51-633e-49ef-be96-65f4bd5b63e6","block_type":"box","text":"®","page_number":110,"box":{"x":762,"y":45,"width":6,"height":4}},{"id":"f4caed59-189a-4e47-b094-b7606be2cad0","block_type":"box","text":"”); public income","page_number":110,"box":{"x":770,"y":45,"width":118,"height":11}},{"id":"cd610db6-0e6d-4402-8256-ce55541fa881","block_type":"box","text":"notes (“PINES","page_number":110,"box":{"x":69,"y":60,"width":99,"height":11}},{"id":"15fbcc1f-aeab-4907-9cfa-2cb746c4ff74","block_type":"box","text":"®","page_number":110,"box":{"x":169,"y":60,"width":6,"height":5}},{"id":"4acb7b2a-bde5-4878-9e7a-49607d140abe","block_type":"box","text":"”); and other trust preferred securities.","page_number":110,"box":{"x":177,"y":60,"width":275,"height":11}},{"id":"22a3dc8b-8418-497d-a437-c18da958708d","block_type":"box","text":"Trust preferred securities are typically issued with a final maturity date, although some are perpetual in nature.","page_number":110,"box":{"x":101,"y":82,"width":790,"height":12}},{"id":"8f3b5cad-d812-4de8-8696-4d3fe1badfbe","block_type":"box","text":"In cer tain instances, a final maturity date may be extended and/or the final payment of principal may be deferred at","page_number":110,"box":{"x":70,"y":98,"width":825,"height":11}},{"id":"23be3dd9-d4d4-4506-b01f-3f2f887970e1","block_type":"box","text":"the issuer’s option for a specified time without default. No redemption can typically take place unless all cumulative","page_number":110,"box":{"x":68,"y":113,"width":827,"height":11}},{"id":"eb80fbab-2760-45bb-9ac9-3beabd5f4bcb","block_type":"box","text":"payment obligations have been met, although issuers may be able to engage in open-market repurchases without","page_number":110,"box":{"x":70,"y":128,"width":808,"height":11}},{"id":"3b72ed80-9ec7-4624-96c1-db04f1ff1303","block_type":"box","text":"regard to whether all payments have been paid.","page_number":110,"box":{"x":69,"y":143,"width":338,"height":11}},{"id":"99eaf7a7-ad86-48d4-afa2-f1a932b59553","block_type":"box","text":"Many trust preferred securities are issued by trusts or other special purpose entities established by operating","page_number":110,"box":{"x":102,"y":166,"width":784,"height":11}},{"id":"c23017d2-5312-4bb4-818b-6828ac9553ef","block_type":"box","text":"companies and are not a direct obligation of an operating company. At the time the trust or special purpose entity","page_number":110,"box":{"x":69,"y":181,"width":811,"height":11}},{"id":"a83cf35b-efa4-42c8-af71-9391b4262b38","block_type":"box","text":"sells such preferred securities to investors, it purchases debt of the operating company (with terms comparable to","page_number":110,"box":{"x":69,"y":196,"width":817,"height":11}},{"id":"f506edb4-c116-49d9-9190-0af4edf07dee","block_type":"box","text":"those of the trust or special purpose entity securities), which enables the operating company to deduct for tax","page_number":110,"box":{"x":68,"y":211,"width":785,"height":11}},{"id":"73440d0d-cdef-4288-9000-cff4dd42df62","block_type":"box","text":"purposes the interest paid on the debt held by the trust or special purpose entity. The trust or special purpose entity","page_number":110,"box":{"x":70,"y":226,"width":830,"height":11}},{"id":"000c3eda-3bd6-45a0-9c4e-ed523d65ab1a","block_type":"box","text":"is generally required to be treated as transparent for U.S. federal income tax purposes such that the holders of the","page_number":110,"box":{"x":70,"y":241,"width":819,"height":11}},{"id":"df20238e-67d3-4126-b6c9-b8240482fd2e","block_type":"box","text":"trust preferred securities are treated as owning beneficial interests in the underlying debt of the operating company.","page_number":110,"box":{"x":68,"y":256,"width":827,"height":12}},{"id":"f1898849-0fdb-448f-83c7-d67731575d73","block_type":"box","text":"Accordingly, payments on the trust preferred securities are treated as interest rather than dividends for U.S. federal","page_number":110,"box":{"x":68,"y":271,"width":824,"height":12}},{"id":"706ae35a-55f2-4d08-b27b-8c24e5b0ed33","block_type":"box","text":"income tax purposes. The trust or special purpose entity in turn would be a holder of the operating company’s debt","page_number":110,"box":{"x":70,"y":286,"width":819,"height":12}},{"id":"a060a305-e4eb-4e3f-ac38-d351f14b7a24","block_type":"box","text":"and would have priority with respect to the operating company’s earnings and profits over the operating company’s","page_number":110,"box":{"x":69,"y":302,"width":817,"height":11}},{"id":"a44220a5-8db2-4070-98c5-e807d7aaacff","block_type":"box","text":"common shareholders, but would typically be subordinated to other classes of the operating company’s debt.","page_number":110,"box":{"x":69,"y":317,"width":778,"height":11}},{"id":"e82ee640-8917-4a02-9b23-1ea113ffc397","block_type":"box","text":"Typically a preferred share has a rating that is slightly below that of its corresponding operating company’s senior","page_number":110,"box":{"x":68,"y":332,"width":811,"height":11}},{"id":"b7861e81-bdd7-4a34-a127-601c796d690c","block_type":"box","text":"debt securities.","page_number":110,"box":{"x":69,"y":347,"width":109,"height":9}},{"id":"2c451110-cb86-410f-905d-9d1b879de649","block_type":"box","text":"Real Estate Investment Trusts (“REITs”).","page_number":110,"box":{"x":102,"y":370,"width":300,"height":11}},{"id":"d41eff4a-f916-4312-892e-1f81a680614d","block_type":"box","text":"In pursuing its investment strategy, a Fund may invest in shares of","page_number":110,"box":{"x":409,"y":370,"width":473,"height":11}},{"id":"be6e76da-c094-4e75-8f0b-712494a9236b","block_type":"box","text":"REITs. REITs possess cer tain risks which differ from an investment in common stocks. REITs are financial vehicles","page_number":110,"box":{"x":70,"y":385,"width":814,"height":11}},{"id":"02e4e6ef-9cd4-4460-8e4d-16df498556fb","block_type":"box","text":"that pool investor’s capital to purchase or finance real estate. REITs may concentrate their investments in specific","page_number":110,"box":{"x":68,"y":400,"width":814,"height":11}},{"id":"f67591b4-f3f1-4d8d-a417-401c065c7ed5","block_type":"box","text":"geographic areas or in specific proper ty types,","page_number":110,"box":{"x":68,"y":415,"width":329,"height":11}},{"id":"9e12a8b0-e8fe-45ba-b90d-471209218330","block_type":"box","text":"i.e.","page_number":110,"box":{"x":405,"y":415,"width":20,"height":9}},{"id":"f3b2c89d-a147-47ba-97ff-ccd89b704097","block_type":"box","text":", hotels, shopping malls, residential complexes and office","page_number":110,"box":{"x":428,"y":415,"width":411,"height":11}},{"id":"1ea41d2c-721b-446b-b27b-62b880bbaf4a","block_type":"box","text":"buildings.","page_number":110,"box":{"x":69,"y":430,"width":66,"height":11}},{"id":"c63ac839-aa04-4540-baa7-c6e645653d30","block_type":"box","text":"REITs are subject to management fees and other expenses, and so a Fund that invests in REITs will bear its","page_number":110,"box":{"x":102,"y":453,"width":768,"height":11}},{"id":"25966940-3f9b-4f14-8e29-0381c6f88d31","block_type":"box","text":"propor tionate share of the costs of the REITs’ operations. There are three general categories of REITs: Equity REITs,","page_number":110,"box":{"x":70,"y":468,"width":824,"height":11}},{"id":"e3f1010c-32f1-4cee-9323-4c48b271a1ef","block_type":"box","text":"Mor tgage REITs and Hybrid REITs. Equity REITs invest primarily in direct fee ownership or leasehold ownership of real","page_number":110,"box":{"x":70,"y":483,"width":829,"height":11}},{"id":"af606084-4866-4d8f-8599-7f76f0002553","block_type":"box","text":"proper ty, which derive most of their income from rents. Mor tgage REITs invest mostly in mor tgages on real estate,","page_number":110,"box":{"x":70,"y":498,"width":813,"height":11}},{"id":"897a7d0c-163e-4d41-9806-01e1801f78f0","block_type":"box","text":"which may secure construction, development or long-term loans; the main source of their income is mor tgage","page_number":110,"box":{"x":68,"y":513,"width":782,"height":12}},{"id":"cc9ff848-5312-4aac-9097-6054958250d8","block_type":"box","text":"interest payments. Hybrid REITs hold both ownership and mor tgage interests in real estate.","page_number":110,"box":{"x":70,"y":529,"width":649,"height":11}},{"id":"fbebed76-7a6f-419f-98b3-4f1fc36ba4d9","block_type":"box","text":"Investing in REITs involves cer tain unique risks in addition to those risks associated with investing in the real","page_number":110,"box":{"x":102,"y":551,"width":776,"height":11}},{"id":"4f1605c6-9cff-4516-bb9e-49fd7bc2cdf5","block_type":"box","text":"estate industry in general. The market value of REIT shares and the ability of the REITs to distribute income may be","page_number":110,"box":{"x":69,"y":566,"width":822,"height":11}},{"id":"faef7710-a8a8-4dfc-83d8-c13849aa8337","block_type":"box","text":"adversely affected by several factors, including rising interest rates, changes in the national, state and local","page_number":110,"box":{"x":69,"y":581,"width":769,"height":12}},{"id":"4d73fb2b-43ab-4a0e-bb0e-0e6ddb994940","block_type":"box","text":"economic climate and real estate conditions, occupancy and rental rates, perceptions of prospective tenants of the","page_number":110,"box":{"x":69,"y":596,"width":822,"height":12}},{"id":"9e203bbe-4a30-4f8b-aa38-9123e16d1862","block_type":"box","text":"safety, convenience and attractiveness of the proper ties, the ability of the owners to provide adequate management,","page_number":110,"box":{"x":69,"y":612,"width":831,"height":11}},{"id":"f68a7de6-9dfb-4e25-bc7a-7ba6a1ca7f69","block_type":"box","text":"maintenance and insurance, the cost of complying with the Americans with Disabilities Act, increased competition","page_number":110,"box":{"x":69,"y":627,"width":810,"height":11}},{"id":"4736376b-a5ab-4b53-813b-7e447bec19a4","block_type":"box","text":"from new proper ties, the impact of present or future environmental legislation and compliance with environmental","page_number":110,"box":{"x":68,"y":642,"width":812,"height":11}},{"id":"82598eed-01db-49c6-8004-499e9bcd4e86","block_type":"box","text":"laws, failing to maintain their exemptions from registration under the Investment Company Act, changes in real estate","page_number":110,"box":{"x":70,"y":657,"width":838,"height":11}},{"id":"f362572b-8e8d-454c-b70f-f44fdc746fcd","block_type":"box","text":"taxes and other operating expenses, adverse changes in governmental rules and fiscal policies, adverse changes in","page_number":110,"box":{"x":68,"y":672,"width":826,"height":11}},{"id":"eb01e0eb-bf4f-45aa-b06f-b07f646d28fe","block_type":"box","text":"zoning laws and other factors beyond the control of the issuers of the REITs. To the extent that assets underlying a","page_number":110,"box":{"x":69,"y":687,"width":817,"height":11}},{"id":"ee851c16-a9a1-4c87-a6fd-4ccae0728ac5","block_type":"box","text":"REIT are concentrated geographically, by proper ty type, or in cer tain other respects, these risks may be heightened.","page_number":110,"box":{"x":70,"y":703,"width":822,"height":11}},{"id":"e7a32408-6cef-4a6b-837d-28179231e176","block_type":"box","text":"In addition, distributions received by a Fund from REITs may consist of dividends, capital gains and/or return of","page_number":110,"box":{"x":70,"y":717,"width":792,"height":12}},{"id":"b4d41b0d-2dc5-4578-a00c-7fd4aa28f919","block_type":"box","text":"capital. As REITs generally pay a higher rate of dividends (on a pre-tax basis) than operating companies, to the extent","page_number":110,"box":{"x":69,"y":732,"width":834,"height":12}},{"id":"496b7ea2-540f-43ff-b8c1-3c8e6e28f242","block_type":"box","text":"application of the Fund’s investment strategy results in the Fund investing in REIT shares, the percentage of the","page_number":110,"box":{"x":69,"y":748,"width":798,"height":11}},{"id":"211ccc00-93e8-442e-8608-4bd9f8142e87","block_type":"box","text":"Fund’s dividend income received from REIT shares will likely exceed the percentage of the Fund’s por tfolio which is","page_number":110,"box":{"x":70,"y":763,"width":818,"height":11}},{"id":"e418c225-e22f-4a30-9994-5053c14eee08","block_type":"box","text":"comprised of REIT shares. Ordinary REIT dividends received by the Fund and distributed to the Fund’s shareholders","page_number":110,"box":{"x":69,"y":778,"width":821,"height":11}},{"id":"0ef4658d-38e9-403b-aa87-e2b533600fe6","block_type":"box","text":"will generally be taxable as ordinary income and will not constitute “qualified dividend income.” However, a non","page_number":110,"box":{"x":68,"y":793,"width":797,"height":11}},{"id":"ed0a723a-1cae-4d21-9e07-ea74445a16f9","block_type":"box","text":"corporate taxpayer who is a direct REIT shareholder may claim a 20% “qualified business income” deduction for","page_number":110,"box":{"x":69,"y":808,"width":798,"height":11}},{"id":"0c20c2b1-038c-4669-8721-cb203940229b","block_type":"box","text":"ordinary REIT dividends, and a regulated investment company may repor t dividends as eligible for this deduction to","page_number":110,"box":{"x":69,"y":823,"width":820,"height":12}},{"id":"f761a8b7-aef0-44ee-8bb9-1662d55fb1ec","block_type":"box","text":"the extent the regulated investment company’s income is derived from ordinary REIT dividends (reduced by allocable","page_number":110,"box":{"x":68,"y":838,"width":831,"height":12}},{"id":"4b395dbb-294d-4fe4-a207-725d83226dd1","block_type":"box","text":"regulated investment company expenses). A shareholder may treat the dividends as such provided the regulated","page_number":110,"box":{"x":69,"y":854,"width":801,"height":11}},{"id":"f41c68f2-9a0f-4b03-ba7f-c69a473b93ba","block_type":"box","text":"investment company and the shareholder satisfy applicable holding period requirements.","page_number":110,"box":{"x":70,"y":869,"width":631,"height":11}},{"id":"575a3b55-3360-4d70-8651-7a0a13a0b0f3","block_type":"box","text":"REITs (especially mor tgage REITs) are also subject to interest rate risk. Rising interest rates may cause REIT","page_number":110,"box":{"x":102,"y":891,"width":772,"height":12}},{"id":"6cd26d4f-0dad-43fe-a8d0-354be7b880db","block_type":"box","text":"investors to demand a higher annual yield, which may, in turn, cause a decline in the market price of the equity","page_number":110,"box":{"x":70,"y":906,"width":790,"height":12}},{"id":"95d63895-e9b9-4354-b336-3878150f1f65","block_type":"box","text":"II-66","page_number":110,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"c220c690-56cf-447d-91dd-2471ddf43fff","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":110,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"892a1d7d-af22-4c1e-9e29-a8ce44e77292","block_type":"box","text":"securities issued by a REIT. Rising interest rates also generally increase the costs of obtaining financing, which could","page_number":111,"box":{"x":69,"y":45,"width":834,"height":11}},{"id":"b3b255f6-2948-4511-8fe3-86d1fe70cb64","block_type":"box","text":"cause the value of a Fund’s REIT investments to decline. During periods when interest rates are declining, mor tgages","page_number":111,"box":{"x":69,"y":60,"width":837,"height":11}},{"id":"cc4225e3-d6ad-4c42-ac1b-426f5018f60e","block_type":"box","text":"are often refinanced. Refinancing may reduce the yield on investments in mor tgage REITs. In addition, since REITs","page_number":111,"box":{"x":69,"y":75,"width":812,"height":11}},{"id":"f3b8b1aa-eea6-44bf-af97-dc1e32a73401","block_type":"box","text":"depend on payment under their mor tgage loans and leases to generate cash to make distributions to their","page_number":111,"box":{"x":69,"y":90,"width":759,"height":11}},{"id":"0363b6ec-703d-4bed-bb4a-236c2cee3bba","block_type":"box","text":"shareholders, investments in REITs may be adversely affected by defaults on such mor tgage loans or leases.","page_number":111,"box":{"x":69,"y":105,"width":778,"height":11}},{"id":"a0f2cbfe-e062-49f0-a613-7fd8b0bb01a7","block_type":"box","text":"Investing in cer tain REITs, which often have small market capitalizations, may also involve the same risks as","page_number":111,"box":{"x":102,"y":128,"width":773,"height":11}},{"id":"f152b990-d93e-4923-b684-acc1d3ab8cc4","block_type":"box","text":"investing in other small capitalization companies. REITs may have limited financial resources and their securities may","page_number":111,"box":{"x":70,"y":143,"width":836,"height":11}},{"id":"11f45704-a80f-49cc-b6a1-3208eda3e8ff","block_type":"box","text":"trade less frequently and in limited volume and may be subject to more abrupt or erratic price movements than larger","page_number":111,"box":{"x":68,"y":158,"width":839,"height":11}},{"id":"c55dc3c5-31f4-4602-8ee9-f7374439a977","block_type":"box","text":"company securities. Historically, small capitalization stocks, such as REITs, have been more volatile in price than the","page_number":111,"box":{"x":69,"y":173,"width":832,"height":11}},{"id":"46730d72-2e2f-480f-b373-155294cd8841","block_type":"box","text":"larger capitalization stocks such as those included in the S&P 500 Index. The management of a REIT may be subject","page_number":111,"box":{"x":70,"y":188,"width":832,"height":12}},{"id":"5fcf2d34-bb11-446b-9a7d-0dc1e104d540","block_type":"box","text":"to conflicts of interest with respect to the operation of the business of the REIT and may be involved in real estate","page_number":111,"box":{"x":68,"y":203,"width":815,"height":12}},{"id":"d3da0e4f-04c7-4842-b308-313134a59b20","block_type":"box","text":"activities competitive with the REIT. REITs may own proper ties through joint ventures or in other circumstances in","page_number":111,"box":{"x":69,"y":219,"width":804,"height":11}},{"id":"41fc4fcd-992d-4cc7-914f-aaa7e76ada3b","block_type":"box","text":"which the REIT may not have control over its investments. REITs may incur significant amounts of leverage.","page_number":111,"box":{"x":68,"y":234,"width":761,"height":11}},{"id":"929ca92a-1a1c-409e-92df-bd0559114e48","block_type":"box","text":"Market Risks/Recent Market Events.","page_number":111,"box":{"x":102,"y":256,"width":275,"height":11}},{"id":"b02769e9-48fe-46e7-bce4-825906d6a5a1","block_type":"box","text":"Securities may decline in value due to factors affecting securities","page_number":111,"box":{"x":383,"y":256,"width":466,"height":12}},{"id":"e4906e96-3920-43f6-accc-aac695e42324","block_type":"box","text":"markets generally or par ticular industries represented in the markets. The value of a security may decline due to","page_number":111,"box":{"x":69,"y":271,"width":801,"height":12}},{"id":"b7350353-c5d6-45fa-902a-34f97200028d","block_type":"box","text":"general market conditions, economic trends or events that are not specifically related to a company or to factors that","page_number":111,"box":{"x":68,"y":286,"width":837,"height":12}},{"id":"5f428ff3-6ca8-4309-8e39-85582fbf70a3","block_type":"box","text":"affect a par ticular industry or industries, or factors that affect a par ticular issuer or issuers, exchange, country,","page_number":111,"box":{"x":69,"y":302,"width":795,"height":11}},{"id":"f3fa357a-f9cf-4f7d-8e4d-a7c6df5f4720","block_type":"box","text":"group of countries, region, market, industry, group of industries, sector or asset class. The success of a Fund’s","page_number":111,"box":{"x":68,"y":317,"width":796,"height":11}},{"id":"8816f657-f845-4b20-9c43-d160930ae592","block_type":"box","text":"activities could be affected by interest rates, availability of credit, inflation rates, economic uncer tainty, changes in","page_number":111,"box":{"x":69,"y":332,"width":817,"height":11}},{"id":"aec02112-d33a-4ada-9afb-b06f175575b7","block_type":"box","text":"laws, trade barriers, economic sanctions, currency exchange controls, and local, regional or global events such as","page_number":111,"box":{"x":70,"y":347,"width":812,"height":11}},{"id":"af9774ad-6806-43ab-8fc1-b8c48194d398","block_type":"box","text":"war, acts of terrorism, natural and environmental disasters, the spread of infectious illness or other public health","page_number":111,"box":{"x":68,"y":362,"width":807,"height":11}},{"id":"ca512bcc-2ffd-4eac-8642-eacc099f82dd","block_type":"box","text":"issues, recessions, or other events could have a significant impact on a Fund and its investments. During a general","page_number":111,"box":{"x":70,"y":377,"width":822,"height":12}},{"id":"853db8ca-1da9-49c0-8c7c-40990bc74455","block_type":"box","text":"economic downturn in the securities markets, multiple asset classes may be negatively affected. These factors may","page_number":111,"box":{"x":69,"y":392,"width":828,"height":12}},{"id":"e274eda2-06f7-44e1-88eb-8c9c33fda5bd","block_type":"box","text":"affect the level and volatility of securities prices and the liquidity of a Fund’s investments, which could impair the","page_number":111,"box":{"x":69,"y":407,"width":804,"height":12}},{"id":"ee79cec2-15ec-44a7-9c9c-4d430cfca306","block_type":"box","text":"Fund’s profitability or result in losses. A Fund may maintain substantial trading positions that can be adversely","page_number":111,"box":{"x":70,"y":423,"width":787,"height":11}},{"id":"bafd9e18-9c64-46f1-835e-2fdf8034a7bd","block_type":"box","text":"affected by the level of volatility in the financial markets; the larger the positions, the greater the potential for loss.","page_number":111,"box":{"x":69,"y":438,"width":819,"height":11}},{"id":"e5ca9f14-83de-49e5-9895-23494192ae11","block_type":"box","text":"Unpredictable or unstable market conditions may result in reduced oppor tunities to find suitable investments to","page_number":111,"box":{"x":70,"y":453,"width":796,"height":11}},{"id":"35c60e9d-6bdc-4d30-873f-f406a0de7483","block_type":"box","text":"deploy capital or make it more difficult to exit and realize value from a Fund’s existing investments. It is impor tant to","page_number":111,"box":{"x":69,"y":468,"width":832,"height":11}},{"id":"b8752eb7-eb91-4bc5-833e-a50632fbdb2c","block_type":"box","text":"understand that a Fund can incur material losses even if it reacts quickly to difficult market conditions and there can","page_number":111,"box":{"x":69,"y":483,"width":831,"height":11}},{"id":"37b23c83-8471-40c7-871c-b67bc3110414","block_type":"box","text":"be no assurance that a Fund will not suffer material adverse effects from broad and rapid changes in market","page_number":111,"box":{"x":69,"y":498,"width":776,"height":11}},{"id":"a3566f98-845e-4788-8a7f-06d0471f7df2","block_type":"box","text":"conditions.","page_number":111,"box":{"x":69,"y":514,"width":76,"height":8}},{"id":"dc4172e5-396a-4165-a27d-2bba79082e9b","block_type":"box","text":"Periods of unusually high volatility in the financial markets and restrictive credit conditions, sometimes limited to","page_number":111,"box":{"x":102,"y":536,"width":802,"height":11}},{"id":"a8562341-8fef-4243-b7e6-17a0f49c603d","block_type":"box","text":"a par ticular sector or a geography, can occur. Some countries, including the United States, have adopted and/or are","page_number":111,"box":{"x":69,"y":551,"width":829,"height":11}},{"id":"8d8a0fed-3f6b-4267-9ddd-8eda2e1fda05","block_type":"box","text":"considering the adoption of more protectionist trade policies, a move away from the tighter financial industry","page_number":111,"box":{"x":69,"y":566,"width":775,"height":11}},{"id":"2e26044e-5984-4b88-b455-657f1ba71635","block_type":"box","text":"regulations that followed the financial crisis of 2008, and/or substantially reducing corporate taxes. The exact shape","page_number":111,"box":{"x":69,"y":581,"width":833,"height":12}},{"id":"a07bc3bd-eb05-46d7-9254-9c4af5641a20","block_type":"box","text":"of these policies is still being considered, but the equity and debt markets may react strongly to expectations of","page_number":111,"box":{"x":69,"y":596,"width":799,"height":12}},{"id":"395aaaa8-e162-4a8e-858e-62aadf223ed8","block_type":"box","text":"change, which could increase volatility, especially if the market’s expectations are not borne out. A rise in","page_number":111,"box":{"x":69,"y":612,"width":751,"height":11}},{"id":"3ef024a1-b0e7-405a-952d-8bdedb50a386","block_type":"box","text":"protectionist trade policies, and the possibility of changes to some international trade agreements, could affect the","page_number":111,"box":{"x":70,"y":627,"width":822,"height":11}},{"id":"fef16348-b425-45b4-bb6c-c54f532713d1","block_type":"box","text":"economies of many nations in ways that cannot necessarily be foreseen at the present time. In addition, geopolitical","page_number":111,"box":{"x":69,"y":642,"width":831,"height":11}},{"id":"05a1d0e9-6e16-486e-b37a-00c54d52f813","block_type":"box","text":"and other risks, including environmental and public health, may add to instability in world economies and markets","page_number":111,"box":{"x":69,"y":657,"width":810,"height":11}},{"id":"2ed2269d-e8e8-46c4-9613-63da47038852","block_type":"box","text":"generally. Economies and financial markets throughout the world are increasingly interconnected. As a result, whether","page_number":111,"box":{"x":68,"y":672,"width":841,"height":11}},{"id":"b620f2e3-6ef0-4a17-8b15-ea72256166ee","block_type":"box","text":"or not a Fund invests in securities of issuers located in or with significant exposure to countries experiencing","page_number":111,"box":{"x":69,"y":687,"width":775,"height":11}},{"id":"1f22e038-4f90-4023-a0b8-43afee39cd0e","block_type":"box","text":"economic, political and/or financial difficulties, the value and liquidity of the Fund’s investments may be negatively","page_number":111,"box":{"x":69,"y":702,"width":818,"height":12}},{"id":"ce98c094-9d06-4776-83dd-ff419314783c","block_type":"box","text":"affected by such events.","page_number":111,"box":{"x":69,"y":717,"width":173,"height":12}},{"id":"b48940c7-5e57-419d-bcc9-5a9fe5dcca8e","block_type":"box","text":"Governments and regulators may take actions that affect the regulation of the Fund or the instruments in which","page_number":111,"box":{"x":102,"y":740,"width":795,"height":11}},{"id":"14f26514-808d-4e86-a0b8-4ec7e6bf7ff5","block_type":"box","text":"the Fund invests, or the issuers of such instruments, in ways that are unforeseeable. Future legislation or regulation","page_number":111,"box":{"x":68,"y":755,"width":830,"height":11}},{"id":"b830b5c6-09a1-42fa-9c79-1a866b7de0eb","block_type":"box","text":"or other governmental actions could limit or preclude the Fund’s abilities to achieve its investment objectives or","page_number":111,"box":{"x":69,"y":771,"width":796,"height":11}},{"id":"d660d5e2-164a-45d9-b29c-54cd95c01e93","block_type":"box","text":"otherwise adversely impact an investment in the Fund. Recent policy initiatives under taken by the U.S. government","page_number":111,"box":{"x":69,"y":786,"width":820,"height":11}},{"id":"67a4d9df-2c74-4d7c-9feb-10f83417366e","block_type":"box","text":"have the potential to impact international relations, trade agreements and the overall regulatory environment in ways","page_number":111,"box":{"x":69,"y":801,"width":833,"height":11}},{"id":"6becaf11-51a0-47e0-a552-a9a2335303b2","block_type":"box","text":"that could create uncer tainty and instability in domestic and global markets and could adversely affect the","page_number":111,"box":{"x":68,"y":816,"width":759,"height":11}},{"id":"45018eb9-8412-4b42-aa8a-122e2e08b8d7","block_type":"box","text":"investment per formance of the Fund. In par ticular, actions taken by the U.S. government in respect of international","page_number":111,"box":{"x":70,"y":831,"width":819,"height":11}},{"id":"cb0102c1-bef3-4673-93d0-aa5346f1cdd3","block_type":"box","text":"trade relations could lead to trade wars, increased costs for impor ted goods, disruptions in supply chains, reduced","page_number":111,"box":{"x":68,"y":846,"width":821,"height":11}},{"id":"18b4ddd5-669f-40c7-a7a8-c25d18ef9f4a","block_type":"box","text":"foreign investment, and instability in regions where the Fund invests. Political and diplomatic events within the United","page_number":111,"box":{"x":68,"y":861,"width":837,"height":11}},{"id":"58bdbb01-ce11-42c9-819b-2c0d169e0a28","block_type":"box","text":"States, including a contentious domestic political environment, changes in political par ty control of one or more","page_number":111,"box":{"x":69,"y":876,"width":795,"height":11}},{"id":"9dad523d-3ecb-4eea-aeb6-53877a726799","block_type":"box","text":"branches of the U.S. Government, the U.S. Government’s inability at times to agree on a long-term budget and deficit","page_number":111,"box":{"x":69,"y":891,"width":836,"height":12}},{"id":"11b0cc7e-b8bb-4811-8b13-0fa7e7e7a70c","block_type":"box","text":"reduction plan, the threat of a U.S. Government shutdown, and disagreements over, or threats not to increase, the","page_number":111,"box":{"x":69,"y":906,"width":817,"height":12}},{"id":"457e1248-14c3-40c6-a189-88c15931a3d9","block_type":"box","text":"II-67","page_number":111,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"82d6347d-07ae-4a54-b84b-d667a40a1d29","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":111,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"7c31621b-2c09-4840-a477-fe537759e277","block_type":"box","text":"U.S. Government’s borrowing limit (or “debt ceiling”), as well as political and diplomatic events abroad, may affect","page_number":112,"box":{"x":70,"y":45,"width":816,"height":11}},{"id":"7a0ecf8d-7493-4e09-950d-08165bfd254c","block_type":"box","text":"investor and consumer confidence and may adversely impact financial markets and the broader economy, perhaps","page_number":112,"box":{"x":70,"y":60,"width":813,"height":11}},{"id":"f5ae599d-0ef6-4a32-9faf-5dd8782c0900","block_type":"box","text":"suddenly and to a significant degree. A downgrade of the ratings of U.S. Government debt obligations, or concerns","page_number":112,"box":{"x":69,"y":75,"width":815,"height":11}},{"id":"8872e482-daa6-4454-8b91-b05d0f66602e","block_type":"box","text":"about the U.S. Government’s credit quality in general, could have a substantial negative effect on the U.S. and global","page_number":112,"box":{"x":69,"y":90,"width":836,"height":11}},{"id":"b5dcb825-4a83-4c2f-8321-7d47959bb430","block_type":"box","text":"economies. For example, concerns about the U.S. Government’s credit quality may cause increased volatility in the","page_number":112,"box":{"x":69,"y":105,"width":820,"height":11}},{"id":"4a35b095-5b3c-4d72-9444-8dfc5a8136a7","block_type":"box","text":"stock and bond markets, higher interest rates, reduced prices and liquidity of U.S. Treasury securities, and/or","page_number":112,"box":{"x":69,"y":120,"width":785,"height":12}},{"id":"6a2358ef-58b4-4d6d-b1d5-cbe2c959397d","block_type":"box","text":"increased costs of various kinds of debt. Moreover, although the U.S. Government has honored its credit obligations,","page_number":112,"box":{"x":70,"y":135,"width":832,"height":12}},{"id":"4f6e446d-c3da-4405-b1c5-80ca095a969f","block_type":"box","text":"there remains a possibility that the United States could default on its obligations. The consequences of such an","page_number":112,"box":{"x":68,"y":150,"width":799,"height":12}},{"id":"c860dd09-f7ec-4544-a61d-866cad209c8d","block_type":"box","text":"unprecedented event are impossible to predict, but it is likely that a default by the United States would be highly","page_number":112,"box":{"x":69,"y":166,"width":802,"height":11}},{"id":"d5107084-bfd5-42fa-bd76-fc6d30d85f2f","block_type":"box","text":"disruptive to the U.S. and global securities markets and could significantly impair the value of the Fund’s","page_number":112,"box":{"x":69,"y":181,"width":746,"height":11}},{"id":"cb839b53-6378-4a13-b85d-0fb14b25f460","block_type":"box","text":"investments.","page_number":112,"box":{"x":70,"y":196,"width":89,"height":9}},{"id":"0e6fd06e-4095-408d-a970-c280d44b0d70","block_type":"box","text":"The COVID-19 pandemic resulted in significant market volatility, exchange suspensions and closures, declines in","page_number":112,"box":{"x":101,"y":218,"width":802,"height":12}},{"id":"43837751-8bf6-4c84-bb66-2d17e2faf7c4","block_type":"box","text":"global financial markets, higher default rates, supply chain disruptions, and a substantial economic downturn in","page_number":112,"box":{"x":68,"y":234,"width":796,"height":11}},{"id":"6279fb2c-983f-49f3-94fc-1a4cc19d71c0","block_type":"box","text":"economies throughout the world. The impact of this coronavirus, and other epidemics and pandemics that may arise","page_number":112,"box":{"x":69,"y":249,"width":830,"height":11}},{"id":"c9aec677-98a4-4ef0-9a0a-6a8577b79251","block_type":"box","text":"in the future, could affect the economies of many nations, individual companies and the market in general in ways","page_number":112,"box":{"x":70,"y":264,"width":813,"height":11}},{"id":"72fddb04-9d28-4547-b70b-d068f7b612e5","block_type":"box","text":"that cannot necessarily be foreseen at the present time. These health crises may be shor t term or long term, and","page_number":112,"box":{"x":68,"y":279,"width":812,"height":11}},{"id":"e8f9e4a3-a65e-4546-8de3-fa8a66e2d84f","block_type":"box","text":"may exacerbate other pre-existing political, social and economic risks, disrupt normal market conditions and","page_number":112,"box":{"x":69,"y":294,"width":771,"height":11}},{"id":"e596ea9f-cd3a-4e35-a9e2-50fc9f51fc40","block_type":"box","text":"operations, and negatively impact per formance. In addition, the impact of infectious diseases in emerging developing","page_number":112,"box":{"x":69,"y":309,"width":837,"height":11}},{"id":"b95ed993-8a9e-4a19-be10-01dc2f6fd884","block_type":"box","text":"or emerging market countries may be greater due to less established health care systems.","page_number":112,"box":{"x":69,"y":325,"width":646,"height":11}},{"id":"dd7685a1-d632-483b-80f7-be419458da7e","block_type":"box","text":"Legal and Regulatory Risks.","page_number":112,"box":{"x":102,"y":347,"width":197,"height":11}},{"id":"45a8e3c5-ac64-48c4-9f4f-41b76b55f0c5","block_type":"box","text":"The Manager is par t of a larger firm with multiple business lines active in multiple","page_number":112,"box":{"x":305,"y":347,"width":583,"height":11}},{"id":"e8f4dbc1-d806-4361-b681-7580cbc37c91","block_type":"box","text":"jurisdictions that are governed by a multitude of legal systems and regulatory regimes, some of which are new and","page_number":112,"box":{"x":67,"y":362,"width":819,"height":11}},{"id":"e28829c5-2c67-45db-956d-2ee0703882ee","block_type":"box","text":"evolving. As a result, the Funds and the Manager and its affiliates are subject to extensive and sophisticated legal,","page_number":112,"box":{"x":69,"y":377,"width":820,"height":12}},{"id":"4061c0aa-17ba-4bc7-b3fd-f85a261b0e6b","block_type":"box","text":"tax and regulatory risks, including changing laws and regulations, developing interpretations of such laws and","page_number":112,"box":{"x":68,"y":392,"width":781,"height":12}},{"id":"900eb6d7-c594-48fa-932a-c80c50d87714","block_type":"box","text":"regulations, as well as existing laws, and increased scrutiny by regulators and law enforcement authorities.","page_number":112,"box":{"x":69,"y":407,"width":763,"height":12}},{"id":"193100b5-df11-4ee7-b239-8493445b79c3","block_type":"box","text":"Unexpected economic, political, regulatory and diplomatic events within the United States and abroad can trigger new","page_number":112,"box":{"x":70,"y":423,"width":838,"height":11}},{"id":"2ad60a08-b40d-43a5-a0f7-b879bb2618b1","block_type":"box","text":"and complex regulations that the Manager and/or the Funds may need to comply with. The implementation of","page_number":112,"box":{"x":69,"y":438,"width":781,"height":11}},{"id":"0133ef67-8b8a-4625-9ae9-7c6962d959f2","block_type":"box","text":"changes to comply with current and/or new regulations applicable to the Funds and/or the Manager could have a","page_number":112,"box":{"x":69,"y":453,"width":807,"height":11}},{"id":"6fd5175d-443d-46cd-afb6-58c209ec10ec","block_type":"box","text":"material adverse effect on the Funds (including by imposing material costs on the Funds, reducing profit margins,","page_number":112,"box":{"x":69,"y":468,"width":807,"height":11}},{"id":"b1d764a0-78c2-4ac4-88c8-52267c3b1294","block_type":"box","text":"reducing investment oppor tunities or by otherwise restricting the Funds and/or the Manager).","page_number":112,"box":{"x":69,"y":483,"width":666,"height":11}},{"id":"1e7799c3-1c48-4cc4-bdc0-3c450b724d6c","block_type":"box","text":"Tariff and Trade Policy Risks.","page_number":112,"box":{"x":103,"y":506,"width":202,"height":11}},{"id":"b2e5385e-e01b-447f-82eb-2d1b906e7af4","block_type":"box","text":"Some countries, including the U.S., have adopted more protectionist trade policies.","page_number":112,"box":{"x":312,"y":506,"width":593,"height":11}},{"id":"6ff663e7-7c50-4bb1-85e8-501fed48f528","block_type":"box","text":"The U.S. government recently altered its approach to international trade policy, resulting in significant impacts on","page_number":112,"box":{"x":68,"y":521,"width":806,"height":11}},{"id":"637be887-b726-4fdd-964b-69a8b10b6022","block_type":"box","text":"international trade relations, cer tain tax and immigration policies, and other aspects of the national and international","page_number":112,"box":{"x":70,"y":536,"width":833,"height":11}},{"id":"76682dab-72ad-4669-9f29-159aa8b66b3c","block_type":"box","text":"political and financial landscape. The rise in protectionist trade policies, slowing economic growth, changes to some","page_number":112,"box":{"x":70,"y":551,"width":827,"height":11}},{"id":"7b3b9b6a-05de-461c-a6e8-51449dcfd376","block_type":"box","text":"major international trade agreements, risks associated with trade agreements between the U.S. and the European","page_number":112,"box":{"x":69,"y":566,"width":814,"height":11}},{"id":"84f42e1b-8e4b-4917-8e94-5da6a1898d34","block_type":"box","text":"Union, and the risks associated with trade negotiations between the U.S. and China, could affect the economies of","page_number":112,"box":{"x":70,"y":581,"width":821,"height":12}},{"id":"f6f544f9-ebfc-49de-be4b-cb163bfb58a2","block_type":"box","text":"many nations in ways that cannot necessarily be foreseen at the present time.","page_number":112,"box":{"x":69,"y":596,"width":559,"height":12}},{"id":"68ccce20-8f40-41ec-8e00-f018dfcacc21","block_type":"box","text":"Global trade disruption, significant introductions of trade barriers, and bilateral trade frictions, together with any","page_number":112,"box":{"x":102,"y":619,"width":796,"height":11}},{"id":"9621cf81-c413-48fb-9f01-e872165c3c5c","block_type":"box","text":"future downturns in the global economy resulting therefrom, could adversely affect the financial per formance of a","page_number":112,"box":{"x":68,"y":634,"width":809,"height":12}},{"id":"a288e1e3-6eb5-42ce-b7e3-348ab8d293a0","block_type":"box","text":"Fund and its investments. Trade policy may be an ongoing source of instability, potentially resulting in significant","page_number":112,"box":{"x":70,"y":649,"width":799,"height":12}},{"id":"0907dde7-31aa-416c-91cd-35e3a2cde2f0","block_type":"box","text":"currency fluctuations and/or having other adverse effects on international markets, international trade agreements,","page_number":112,"box":{"x":69,"y":664,"width":823,"height":12}},{"id":"71f83f0d-b796-4ae1-957f-575ff48c3e63","block_type":"box","text":"and/or other existing cross-border cooperation arrangements (whether economic, tax, fiscal, legal, regulatory, or","page_number":112,"box":{"x":69,"y":680,"width":801,"height":11}},{"id":"73f839b4-868d-464a-8958-a0dfd5cfca88","block_type":"box","text":"otherwise). To the extent trade disputes escalate globally, there could be additional significant impacts on the","page_number":112,"box":{"x":69,"y":695,"width":783,"height":11}},{"id":"8931185d-5def-486f-8235-dda756a27db6","block_type":"box","text":"sectors or industries in which a Fund invests and other adverse impacts on a Fund’s overall per formance.","page_number":112,"box":{"x":69,"y":710,"width":753,"height":11}},{"id":"3959842f-52d4-4774-8dc7-ec47900e786f","block_type":"box","text":"Geographic Risks","page_number":112,"box":{"x":102,"y":733,"width":123,"height":11}},{"id":"6ac43718-ec8e-4e43-94d0-cf20dd3a420b","block_type":"box","text":". Some of the companies in which the Fund invests may be located in, or otherwise connected","page_number":112,"box":{"x":226,"y":732,"width":671,"height":12}},{"id":"dcfe003a-b135-413b-bb44-f42a9723701d","block_type":"box","text":"to, par ts of the world affected by natural disasters such as severe heat, ear thquakes, tornadoes, volcanic eruptions,","page_number":112,"box":{"x":68,"y":748,"width":835,"height":11}},{"id":"cb479716-1126-42e8-b2be-4df1b2db538e","block_type":"box","text":"wildfires, droughts, floods, hurricanes or tsunamis, and are economically sensitive to environmental events. In","page_number":112,"box":{"x":68,"y":763,"width":787,"height":11}},{"id":"9425fd69-cd25-4936-bede-eb755bd21ac9","block_type":"box","text":"addition, issuers may be impacted by security concerns with respect to a country or region, such as war and other","page_number":112,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"9e93c5e8-2c35-4c1a-9efb-6d9f2ec08fb8","block_type":"box","text":"types of conflict, terrorism, strained international relations and territorial disputes. Any of these events may adversely","page_number":112,"box":{"x":68,"y":793,"width":840,"height":11}},{"id":"2d4b3ad2-156a-4679-976d-faa83fc8715d","block_type":"box","text":"affect the issuers, markets and economies to which a Fund is exposed, which may adversely affect the value of the","page_number":112,"box":{"x":69,"y":808,"width":824,"height":11}},{"id":"ce3664a1-8d79-4bd7-baf3-9959fcae753a","block_type":"box","text":"Fund.","page_number":112,"box":{"x":70,"y":823,"width":36,"height":9}},{"id":"21e97adf-f6f8-428b-a858-0f29bdf1f942","block_type":"box","text":"Reference Rate Replacement Risk.","page_number":112,"box":{"x":102,"y":846,"width":255,"height":11}},{"id":"d5ff18c7-3a93-489f-bd49-73eb06dc5fa9","block_type":"box","text":"The London Interbank Offered Rate (“LIBOR”) had historically been used","page_number":112,"box":{"x":363,"y":846,"width":514,"height":11}},{"id":"fd7fd3b5-d3b3-45ec-9e15-7714dc864c63","block_type":"box","text":"extensively in the U.S. and globally as a “benchmark” or “reference rate” for various commercial and financial","page_number":112,"box":{"x":69,"y":861,"width":782,"height":11}},{"id":"1f6224c9-cdc2-495f-a88e-6323138f0bd6","block_type":"box","text":"contracts, including corporate and municipal bonds, bank loans, asset-backed and mor tgage-related securities,","page_number":112,"box":{"x":69,"y":876,"width":791,"height":11}},{"id":"39a1f1d0-a9ec-48b6-ba68-20dbc40c1656","block_type":"box","text":"interest rate swaps and other derivatives. Instruments in which a Fund may have historically paid interest at floating","page_number":112,"box":{"x":70,"y":891,"width":826,"height":12}},{"id":"533e63b0-fb0b-4e1d-9016-0f6d882ccba3","block_type":"box","text":"rates based on LIBOR or may have been subject to interest caps or floors based on LIBOR. The Funds and issuers of","page_number":112,"box":{"x":69,"y":906,"width":834,"height":12}},{"id":"698b4e54-54f9-4f57-b987-5637fb138ce4","block_type":"box","text":"II-68","page_number":112,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3b605dea-f9d3-4a49-a599-b60159987c77","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":112,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"d337a727-2751-4cb2-94dc-9b560f7dfc9c","block_type":"box","text":"instruments in which a Fund invests may have also historically obtained financing at floating rates based on LIBOR. In","page_number":113,"box":{"x":70,"y":45,"width":837,"height":11}},{"id":"9f70f403-7fdf-436d-994b-5ab0de293872","block_type":"box","text":"connection with the global transition away from LIBOR led by regulators and market par ticipants as a result of","page_number":113,"box":{"x":69,"y":60,"width":783,"height":11}},{"id":"74909efd-8719-4ead-a45a-e8ed81a2844e","block_type":"box","text":"benchmark reforms, LIBOR was last published on a representative basis at the end of June 2023. Alternative","page_number":113,"box":{"x":69,"y":75,"width":779,"height":11}},{"id":"4ae921fd-905b-4f29-ad17-bccc8d4af8be","block_type":"box","text":"reference rates to LIBOR have been established in most major currencies and markets in these alternative rates are","page_number":113,"box":{"x":69,"y":90,"width":830,"height":11}},{"id":"8c1f2058-b68a-4302-be8e-84af2342e866","block_type":"box","text":"continuing to develop (","page_number":113,"box":{"x":69,"y":105,"width":160,"height":11}},{"id":"6de3fa6d-5ccc-43fb-a724-8d2998627e74","block_type":"box","text":"e.g.","page_number":113,"box":{"x":231,"y":107,"width":25,"height":9}},{"id":"023be6ec-b2cb-4353-b2b0-0d3ffef4a874","block_type":"box","text":", the Secured Overnight Financing Rate (“SOFR”) for USD-LIBOR). While the transition from","page_number":113,"box":{"x":258,"y":105,"width":641,"height":11}},{"id":"3caa1fa0-4638-4416-8659-af6b5efeb075","block_type":"box","text":"LIBOR has gone relatively smoothly, residual risks associated with the transition may remain that may impact","page_number":113,"box":{"x":70,"y":120,"width":777,"height":12}},{"id":"310d6e9c-9a33-4f53-a167-f2525062c790","block_type":"box","text":"markets or par ticular investments and, as such, the full impact of the transition on the Funds or the financial","page_number":113,"box":{"x":69,"y":135,"width":776,"height":11}},{"id":"264bc294-25a4-43bd-af6d-d18e55c6b216","block_type":"box","text":"instruments in which the Funds invest cannot yet be fully determined.","page_number":113,"box":{"x":70,"y":150,"width":493,"height":12}},{"id":"bc6324d4-b77e-47dd-927b-b6ab3a17f709","block_type":"box","text":"SOFR is intended to be a broad measure of the cost of borrowing funds overnight in transactions that are","page_number":113,"box":{"x":102,"y":173,"width":750,"height":11}},{"id":"c2e5858f-d9fd-4f9a-88db-e738354082d8","block_type":"box","text":"collateralized by U.S. Treasury securities. SOFR is calculated based on transaction-level repo data collected from","page_number":113,"box":{"x":69,"y":188,"width":803,"height":11}},{"id":"ddb9ed78-bdd2-4da8-a11e-40bd7d45d210","block_type":"box","text":"various sources. For each trading day, SOFR is calculated as a volume-weighted median rate derived from such data.","page_number":113,"box":{"x":68,"y":203,"width":831,"height":12}},{"id":"0ec803dc-7870-49c2-9e36-b250f4d3142f","block_type":"box","text":"Because SOFR is a financing rate based on overnight secured funding transactions, it differs fundamentally from","page_number":113,"box":{"x":70,"y":218,"width":801,"height":12}},{"id":"d686a8e7-7cce-4a70-a1c4-96d27ebca760","block_type":"box","text":"LIBOR. LIBOR is intended to be an unsecured rate that represents interbank funding costs for different shor t-term","page_number":113,"box":{"x":70,"y":234,"width":810,"height":11}},{"id":"f0c97211-8353-47bc-ba06-968e6bbeac1e","block_type":"box","text":"maturities or tenors. It is a forward-looking rate reflecting expectations regarding interest rates for the applicable","page_number":113,"box":{"x":69,"y":249,"width":803,"height":11}},{"id":"f83f8fc8-1178-42d4-bccf-50458f714122","block_type":"box","text":"tenor. Thus, LIBOR is intended to be sensitive, in cer tain respects, to bank credit risk and to term interest rate risk.","page_number":113,"box":{"x":68,"y":264,"width":825,"height":11}},{"id":"42dbed4b-25d0-4a22-83bf-3b025e1d544e","block_type":"box","text":"In contrast, SOFR is a secured overnight rate reflecting the credit of U.S. Treasury securities as collateral. Thus, it is","page_number":113,"box":{"x":70,"y":279,"width":828,"height":11}},{"id":"a0966fbb-cc6a-4cc7-8e74-a3b47820764b","block_type":"box","text":"largely insensitive to credit-risk considerations and to shor t-term interest rate risks. SOFR is a transaction-based rate,","page_number":113,"box":{"x":70,"y":294,"width":838,"height":11}},{"id":"e097a118-5d9f-41fb-b69c-36194c39af22","block_type":"box","text":"and it has been more volatile than other benchmark or market rates, such as three-month LIBOR, during cer tain","page_number":113,"box":{"x":69,"y":309,"width":796,"height":11}},{"id":"584e1e2f-56ab-46a6-a465-9bfd14a6082d","block_type":"box","text":"periods. For these reasons, among others, there is no assurance that SOFR, or rates derived from SOFR, will per form","page_number":113,"box":{"x":70,"y":324,"width":836,"height":12}},{"id":"eccab36f-f7ba-47d9-915b-2f82ff9f4d77","block_type":"box","text":"in the same or similar way as LIBOR would have per formed at any time, and there is no assurance that SOFR-based","page_number":113,"box":{"x":70,"y":339,"width":824,"height":12}},{"id":"32d48429-9cf2-41f2-b5fb-26d2d58bfaf5","block_type":"box","text":"rates will be a suitable substitute for LIBOR. SOFR has a relatively limited history, having been first published in April","page_number":113,"box":{"x":69,"y":355,"width":830,"height":11}},{"id":"beef8965-078b-46a0-88c7-59ed75ae0852","block_type":"box","text":"2018. The future per formance of SOFR, and SOFR-based reference rates, cannot be predicted based on SOFR’s","page_number":113,"box":{"x":69,"y":370,"width":800,"height":11}},{"id":"cfe3f4ae-7b60-45c4-8209-c65f65b3af62","block_type":"box","text":"history or otherwise. Levels of SOFR in the future may bear little or no relation to historical levels of SOFR, LIBOR or","page_number":113,"box":{"x":69,"y":385,"width":827,"height":11}},{"id":"f65bcb06-78d9-4d3b-bb8e-031cb7bc8ff1","block_type":"box","text":"other rates. There can also be no assurance that SOFR will not be discontinued or fundamentally altered in a manner","page_number":113,"box":{"x":69,"y":400,"width":835,"height":11}},{"id":"f7feab6e-d290-4dd9-a689-2ba7149c51b3","block_type":"box","text":"that is materially adverse to the interests of the Fund.","page_number":113,"box":{"x":68,"y":415,"width":384,"height":11}},{"id":"b55f6ef2-8a6e-4496-878c-a3b28132948e","block_type":"box","text":"In addition, interest rates or other types of rates and indices which are classified as “benchmarks” have been","page_number":113,"box":{"x":102,"y":438,"width":782,"height":11}},{"id":"24f64522-deed-48ce-a140-fda2f87cb57a","block_type":"box","text":"the subject of ongoing national and international regulatory reform, including under the European Union (“EU”)","page_number":113,"box":{"x":68,"y":453,"width":786,"height":11}},{"id":"98c91d7d-3007-45a1-b052-ee838b7a2afa","block_type":"box","text":"regulation on indices used as benchmarks in financial instruments and financial contracts (known as the","page_number":113,"box":{"x":69,"y":468,"width":746,"height":11}},{"id":"71384f2e-8690-446d-8704-de236ebd6cb2","block_type":"box","text":"“Benchmarks Regulation”). The Benchmarks Regulation has been enacted into United Kingdom (“UK”) law by vir tue","page_number":113,"box":{"x":70,"y":483,"width":822,"height":11}},{"id":"453debcf-1f6c-4b01-9412-13764fd1d324","block_type":"box","text":"of the EU (Withdrawal) Act 2018 (as amended), subject to amendments made by the Benchmarks (Amendment and","page_number":113,"box":{"x":69,"y":498,"width":821,"height":11}},{"id":"95a4f5e4-7cb0-4a4b-bcfe-86e2b40d63a0","block_type":"box","text":"Transitional Provision) (EU Exit) Regulations 2019 (SI 2019/657) and other statutory instruments. Following the","page_number":113,"box":{"x":68,"y":513,"width":799,"height":12}},{"id":"58b0ca73-61d4-44b5-9543-cbcca19a8f5f","block_type":"box","text":"implementation of these reforms, the manner of administration of benchmarks has changed and may fur ther change","page_number":113,"box":{"x":70,"y":528,"width":830,"height":12}},{"id":"12aab6da-a4b3-474d-be53-f4f9f3177412","block_type":"box","text":"in the future, with the result that relevant benchmarks may per form differently than in the past, the use of","page_number":113,"box":{"x":70,"y":543,"width":757,"height":12}},{"id":"9c684a9f-6292-4c3f-ad11-c74742c5da52","block_type":"box","text":"benchmarks that are not compliant with the new standards by cer tain supervised entities may be restricted, and","page_number":113,"box":{"x":69,"y":559,"width":802,"height":11}},{"id":"a1d9881f-7c87-452d-9d76-343cee1c7908","block_type":"box","text":"cer tain benchmarks may be eliminated entirely. Such changes could cause increased market volatility and disruptions","page_number":113,"box":{"x":69,"y":574,"width":840,"height":11}},{"id":"2b2e2517-1448-4a50-8647-069a396e1554","block_type":"box","text":"in liquidity for instruments that rely on or are impacted by such benchmarks. Additionally, there could be other","page_number":113,"box":{"x":70,"y":589,"width":782,"height":11}},{"id":"25c21e68-ba3f-4f18-889c-a8f8446ffbf8","block_type":"box","text":"consequences which cannot be predicted.","page_number":113,"box":{"x":69,"y":604,"width":298,"height":11}},{"id":"73c04010-33c2-48ad-a6c2-46718a049dc0","block_type":"box","text":"Repurchase Agreements and Purchase and Sale Contracts.","page_number":113,"box":{"x":102,"y":627,"width":432,"height":11}},{"id":"24757420-8d7a-46eb-86b2-76fc660f6f10","block_type":"box","text":"Under repurchase agreements and purchase and","page_number":113,"box":{"x":541,"y":627,"width":347,"height":11}},{"id":"40917869-f70f-4ce8-ab13-d76ca404786b","block_type":"box","text":"sale contracts, the other par ty agrees, upon entering into the contract with a Fund, to repurchase a security sold to","page_number":113,"box":{"x":69,"y":642,"width":821,"height":11}},{"id":"90572a61-94ed-43c5-86de-5b475898fd27","block_type":"box","text":"the Fund at a mutually agreed-upon time and price in a specified currency, thereby determining the yield during the","page_number":113,"box":{"x":68,"y":657,"width":815,"height":11}},{"id":"9b280a7f-48d3-4165-bfea-455adde99b2f","block_type":"box","text":"term of the agreement.","page_number":113,"box":{"x":68,"y":672,"width":164,"height":11}},{"id":"23ce7c5a-ec7d-4e4f-9def-e5886009b21a","block_type":"box","text":"A purchase and sale contract differs from a repurchase agreement in that the contract arrangements stipulate","page_number":113,"box":{"x":101,"y":695,"width":788,"height":11}},{"id":"c0274202-bd73-457b-bcf3-b196bc8a6eb8","block_type":"box","text":"that securities are owned by the Fund and the purchaser receives any interest on the security paid during the period.","page_number":113,"box":{"x":68,"y":710,"width":831,"height":11}},{"id":"79d854b4-7ed8-4d04-9a0f-a97c4b551017","block_type":"box","text":"In the case of repurchase agreements, the prices at which the trades are conducted do not reflect accrued interest","page_number":113,"box":{"x":70,"y":725,"width":821,"height":11}},{"id":"d9215b27-3495-440e-a1f9-57142e607f4c","block_type":"box","text":"on the underlying obligation; whereas, in the case of purchase and sale contracts, the prices take into account","page_number":113,"box":{"x":69,"y":740,"width":790,"height":11}},{"id":"88a34c79-b04a-4ea2-ba04-40b9f56fb8ca","block_type":"box","text":"accrued interest. A Fund may enter into “tri-par ty” repurchase agreements. In “tri-par ty” repurchase agreements, an","page_number":113,"box":{"x":69,"y":755,"width":827,"height":11}},{"id":"8e01b6eb-02ec-4b6a-972d-f0e1407996d7","block_type":"box","text":"unaffiliated third-par ty custodian maintains accounts to hold collateral for the Fund and its counterpar ties and,","page_number":113,"box":{"x":69,"y":770,"width":788,"height":11}},{"id":"74170ad6-7fcb-4e08-8b71-d0b7237c0909","block_type":"box","text":"therefore, the Fund may be subject to the credit risk of those custodians.","page_number":113,"box":{"x":68,"y":785,"width":522,"height":12}},{"id":"2de36dfb-dbcc-48f4-8ac1-d5743193c7a8","block_type":"box","text":"Some repurchase agreements and purchase and sale contracts are structured to result in a fixed rate of return","page_number":113,"box":{"x":102,"y":808,"width":792,"height":11}},{"id":"aab50901-d2f7-4d25-b6bd-c081b1ec504f","block_type":"box","text":"insulated from market fluctuations during the term of the agreement, although such return may be affected by","page_number":113,"box":{"x":70,"y":823,"width":784,"height":12}},{"id":"84927e4a-0216-4cf8-8030-903f121e0d87","block_type":"box","text":"currency fluctuations. However, in the event of a default under a repurchase agreement or under a purchase and sale","page_number":113,"box":{"x":69,"y":838,"width":837,"height":12}},{"id":"b80d592d-5edf-4bbf-97d3-74798f944768","block_type":"box","text":"contract, instead of the contractual fixed rate, the rate of return to the Fund would be dependent upon intervening","page_number":113,"box":{"x":69,"y":853,"width":812,"height":12}},{"id":"6407c819-4266-44e3-815a-2c8c53cc0936","block_type":"box","text":"fluctuations of the market values of the securities underlying the contract and the accrued interest on those","page_number":113,"box":{"x":68,"y":869,"width":770,"height":11}},{"id":"cabc9121-c5ea-45cf-b7c7-1eae9e52949a","block_type":"box","text":"securities. In such event, the Fund would have rights against the seller for breach of contract with respect to any","page_number":113,"box":{"x":69,"y":884,"width":802,"height":11}},{"id":"511818a7-70f2-4618-8e09-f4c2624487d6","block_type":"box","text":"losses arising from market fluctuations following the default.","page_number":113,"box":{"x":70,"y":899,"width":430,"height":11}},{"id":"43798605-a885-4366-8d24-45f55547a350","block_type":"box","text":"II-69","page_number":113,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"ac15fa5a-0fde-470d-872f-9ae063aeb7e4","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":113,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"cb63d416-7bad-48d6-a6c3-6c034eb42071","block_type":"box","text":"Both types of agreement usually cover shor t periods, such as less than one week, although they may have","page_number":114,"box":{"x":102,"y":45,"width":759,"height":11}},{"id":"b2d123e6-4dcc-484e-9195-bcbbee5d037e","block_type":"box","text":"longer terms, and may be construed to be collateralized loans by the purchaser to the seller secured by the","page_number":114,"box":{"x":70,"y":60,"width":765,"height":11}},{"id":"fa5550d5-ecb5-4b5a-b687-f35efcd849b3","block_type":"box","text":"securities transferred to the purchaser. In the case of a repurchase agreement, as a purchaser, a Fund’s Manager or","page_number":114,"box":{"x":69,"y":75,"width":835,"height":11}},{"id":"4e6d8f14-bf63-4ce2-a94c-75deff52eca5","block_type":"box","text":"sub-adviser will monitor the creditwor thiness of the seller, and a Fund will require the seller to provide additional","page_number":114,"box":{"x":69,"y":90,"width":799,"height":11}},{"id":"259b2296-574c-4688-bea8-98941e765b43","block_type":"box","text":"collateral if the market value of the securities falls below the repurchase price at any time during the term of the","page_number":114,"box":{"x":69,"y":105,"width":801,"height":11}},{"id":"08249378-ac0b-459b-b551-d09fb6787d41","block_type":"box","text":"repurchase agreement. The Fund does not have this right to seek additional collateral as a purchaser in the case of","page_number":114,"box":{"x":69,"y":120,"width":826,"height":12}},{"id":"6af13e44-b97b-4741-b912-c003881ca073","block_type":"box","text":"purchase and sale contracts. The Fund’s Manager or sub-adviser will mark-to-market daily the value of the securities.","page_number":114,"box":{"x":70,"y":135,"width":831,"height":12}},{"id":"20c75cdd-d696-405c-8f5d-b3ca90da13af","block_type":"box","text":"Securities subject to repurchase agreements (other than tri-par ty repurchase agreements) and purchase and sale","page_number":114,"box":{"x":69,"y":151,"width":810,"height":11}},{"id":"4b01956d-cb8b-4a77-945d-ef980e77b12a","block_type":"box","text":"contracts will be held by the Fund’s custodian (or sub-custodian) in the Federal Reserve/Treasury book-entry system","page_number":114,"box":{"x":69,"y":166,"width":829,"height":11}},{"id":"75a0c13b-6c31-4f29-8450-14b5b5581bff","block_type":"box","text":"or by another authorized securities depository.","page_number":114,"box":{"x":69,"y":181,"width":329,"height":11}},{"id":"8015d61a-eba1-4401-abe2-617294f1e1c0","block_type":"box","text":"In the event of default by the seller under a repurchase agreement construed to be a collateralized loan, the","page_number":114,"box":{"x":102,"y":203,"width":770,"height":12}},{"id":"b47a3566-aa83-4389-b329-feaab059846d","block_type":"box","text":"underlying securities are not owned by the Fund but only constitute collateral for the seller’s obligation to pay the","page_number":114,"box":{"x":69,"y":218,"width":805,"height":12}},{"id":"137ecc5e-cbd6-4dbc-b897-c72d7e4a5118","block_type":"box","text":"repurchase price. Therefore, the Fund may suffer time delays and incur costs or possible losses in connection with","page_number":114,"box":{"x":69,"y":234,"width":819,"height":11}},{"id":"56f51c3b-f285-438d-9f63-49509da57e66","block_type":"box","text":"disposition of the collateral. If the seller becomes insolvent and subject to liquidation or reorganization under","page_number":114,"box":{"x":69,"y":249,"width":778,"height":11}},{"id":"fad9c873-c011-4771-850a-4161a6801009","block_type":"box","text":"applicable bankruptcy or other laws, a Fund’s ability to dispose of the underlying securities may be restricted. Finally,","page_number":114,"box":{"x":69,"y":264,"width":832,"height":11}},{"id":"8eb95fd0-1a3e-47ca-a8c3-e2919fd507b3","block_type":"box","text":"it is possible that a Fund may not be able to substantiate its interest in the underlying securities. To minimize this","page_number":114,"box":{"x":70,"y":279,"width":810,"height":11}},{"id":"2612b9c3-825e-4bbe-b884-850f2e29d411","block_type":"box","text":"risk, the securities underlying the repurchase agreement will be held by the applicable custodian at all times in an","page_number":114,"box":{"x":69,"y":294,"width":812,"height":11}},{"id":"0951c905-b46b-480a-b318-34f98352a161","block_type":"box","text":"amount at least equal to the repurchase price, including accrued interest. If the seller fails to repurchase the","page_number":114,"box":{"x":69,"y":309,"width":778,"height":11}},{"id":"57e777d3-2853-4794-bafc-393b65fd70e6","block_type":"box","text":"securities, a Fund may suffer a loss to the extent proceeds from the sale of the underlying securities are less than","page_number":114,"box":{"x":69,"y":324,"width":817,"height":12}},{"id":"1032c27f-4d02-40ee-a784-06863f041b81","block_type":"box","text":"the repurchase price.","page_number":114,"box":{"x":68,"y":340,"width":151,"height":10}},{"id":"c079737c-83b9-4b65-8e38-0ca6b4848a6c","block_type":"box","text":"In any repurchase transaction to which a Fund is a par ty, collateral for a repurchase agreement may include cash","page_number":114,"box":{"x":102,"y":362,"width":805,"height":11}},{"id":"353f72a0-3e1c-4594-ac03-452ca6cf7d82","block_type":"box","text":"items and obligations issued by the U.S. Government or its agencies or instrumentalities. For cer tain Funds, however,","page_number":114,"box":{"x":70,"y":377,"width":837,"height":12}},{"id":"f1005a98-3785-47b6-97de-ee0d950d49c1","block_type":"box","text":"collateral may include instruments other than cash items and obligations issued by the U.S. Government or its","page_number":114,"box":{"x":69,"y":392,"width":788,"height":12}},{"id":"b555cffe-fa80-482e-8ccc-bc42c8b662e1","block_type":"box","text":"agencies or instrumentalities, including securities that the Fund could not hold directly under its investment","page_number":114,"box":{"x":69,"y":408,"width":767,"height":11}},{"id":"da8192d5-cf1e-4e8c-965f-e9fbe3575414","block_type":"box","text":"strategies without the repurchase obligation.","page_number":114,"box":{"x":69,"y":423,"width":317,"height":11}},{"id":"7a5e3a06-bc63-4af1-b755-394aa6ecbdd4","block_type":"box","text":"The type of collateral underlying repurchase agreements may also pose cer tain risks for a Fund. Lower quality","page_number":114,"box":{"x":101,"y":445,"width":782,"height":12}},{"id":"286745a9-5935-4f63-be1e-ef4768b0f72d","block_type":"box","text":"collateral and collateral with longer maturities may be subject to greater price fluctuations than higher quality","page_number":114,"box":{"x":69,"y":460,"width":776,"height":12}},{"id":"06809a53-9692-4284-96f2-ef32cd4ee53f","block_type":"box","text":"collateral and collateral with shor ter maturities. If the repurchase agreement counterpar ty were to default, lower","page_number":114,"box":{"x":69,"y":475,"width":799,"height":12}},{"id":"c1040b2f-23fb-4db5-9715-2b3757a76ec6","block_type":"box","text":"quality collateral may be more difficult to liquidate than higher quality collateral. Should the counterpar ty default and","page_number":114,"box":{"x":69,"y":491,"width":829,"height":11}},{"id":"e44ae758-8474-4292-9100-02fdbe62e6a9","block_type":"box","text":"the amount of collateral not be sufficient to cover the counterpar ty’s repurchase obligation, a Fund would retain the","page_number":114,"box":{"x":68,"y":506,"width":825,"height":11}},{"id":"b46776de-f1b5-48e2-973b-1295a52dbfb7","block_type":"box","text":"status of an unsecured creditor of the counterpar ty (","page_number":114,"box":{"x":69,"y":521,"width":374,"height":11}},{"id":"427b36b5-3615-4676-92a5-9276517ca1da","block_type":"box","text":"i.e.","page_number":114,"box":{"x":445,"y":521,"width":20,"height":9}},{"id":"067571ef-b0b8-4cd8-b5d9-314a7f902f40","block_type":"box","text":", the position the Fund would normally be in if it were to hold,","page_number":114,"box":{"x":468,"y":521,"width":434,"height":11}},{"id":"40e72c62-a985-4382-810b-c8b77d2ab27e","block_type":"box","text":"pursuant to its investment policies, other unsecured debt securities of the defaulting counterpar ty) with respect to","page_number":114,"box":{"x":70,"y":536,"width":813,"height":11}},{"id":"9637edf0-c525-46fc-b355-96432c7483ef","block_type":"box","text":"the amount of the shor tfall. As an unsecured creditor, a Fund would be at risk of losing some or all of the principal","page_number":114,"box":{"x":68,"y":551,"width":816,"height":11}},{"id":"341d54bf-7a6e-460d-86df-0e7616a8c4e9","block_type":"box","text":"and income involved in the transaction.","page_number":114,"box":{"x":69,"y":566,"width":278,"height":9}},{"id":"8a3924db-bb84-4f25-8ae7-bd3ab9112943","block_type":"box","text":"Regulations adopted by global prudential regulators require cer tain bank-regulated counterpar ties and cer tain of","page_number":114,"box":{"x":102,"y":589,"width":800,"height":11}},{"id":"92d3cb4a-0319-43e2-a518-0732b6919505","block_type":"box","text":"their affiliates to include in cer tain financial contracts, including many repurchase agreements and purchase and sale","page_number":114,"box":{"x":68,"y":604,"width":840,"height":11}},{"id":"36a4d616-79fe-4f81-bd4d-5c35430aa199","block_type":"box","text":"contracts, terms that delay or restrict the rights of counterpar ties, such as a Fund, to terminate such agreements,","page_number":114,"box":{"x":69,"y":619,"width":814,"height":11}},{"id":"f9e88b6a-8fb4-44d9-8e97-2bdfe5bf2d12","block_type":"box","text":"take foreclosure action, exercise other default rights or restrict transfers of credit suppor t in the event that the","page_number":114,"box":{"x":68,"y":634,"width":790,"height":12}},{"id":"31788d1a-3c3c-4b7e-885f-12a72c35b6c4","block_type":"box","text":"counterpar ty and/or its affiliates are subject to cer tain types of resolution or insolvency proceedings. It is possible","page_number":114,"box":{"x":69,"y":649,"width":818,"height":12}},{"id":"31436350-d3c4-42bd-b4d6-822000fa45f3","block_type":"box","text":"that these requirements, as well as potential additional government regulation and other developments in the","page_number":114,"box":{"x":68,"y":665,"width":783,"height":11}},{"id":"c9b93054-26e9-4eb3-a61b-a98dfc9875ec","block_type":"box","text":"market, could adversely affect a Fund’s ability to terminate existing repurchase agreements and purchase and sale","page_number":114,"box":{"x":69,"y":680,"width":821,"height":11}},{"id":"559443e4-dd46-4790-9032-2c2e1128eb5d","block_type":"box","text":"contracts or to realize amounts to be received under such agreements. The SEC has also finalized rules that will","page_number":114,"box":{"x":69,"y":695,"width":800,"height":11}},{"id":"1ed611c5-c8d3-4932-bb59-22ff69781e9c","block_type":"box","text":"require cer tain transactions involving U.S. Treasuries, including repurchase agreements, to be centrally cleared.","page_number":114,"box":{"x":69,"y":710,"width":796,"height":11}},{"id":"c03cb2ff-8e9a-4719-b299-b357f8bef35a","block_type":"box","text":"Compliance with these rules is expected to be required by the middle of 2027. Although the impact of these rules on","page_number":114,"box":{"x":69,"y":725,"width":834,"height":11}},{"id":"568463a7-bbf7-4bb7-8119-8a0b0ee17809","block_type":"box","text":"the Funds is difficult to predict, they may reduce the availability or increase the costs of such transactions and may","page_number":114,"box":{"x":68,"y":740,"width":824,"height":11}},{"id":"8f4caa70-d09e-4f93-a5bb-f193f3cf9e6f","block_type":"box","text":"adversely affect a Fund’s per formance.","page_number":114,"box":{"x":69,"y":755,"width":279,"height":11}},{"id":"0c426d00-a66b-4ca8-8ff5-fb09fe33d54d","block_type":"box","text":"Restricted Securities.","page_number":114,"box":{"x":102,"y":778,"width":157,"height":9}},{"id":"a75f376a-68bc-4861-8fba-9b3dc75c9f0b","block_type":"box","text":"A Fund may invest in or hold securities that are not registered under the Securities Act","page_number":114,"box":{"x":265,"y":778,"width":617,"height":11}},{"id":"1385ebf7-8b73-483d-94f0-9d160ce9c4ad","block_type":"box","text":"(“restricted securities”), which may include securities in private companies and Rule 144A Securities. Restricted","page_number":114,"box":{"x":69,"y":793,"width":801,"height":11}},{"id":"25861500-4995-4535-be64-1031484300bd","block_type":"box","text":"securities may be sold in private placement transactions between issuers and their purchasers, including through","page_number":114,"box":{"x":69,"y":808,"width":808,"height":11}},{"id":"6e03ecdd-1f15-4618-ad07-56e42e8e53e5","block_type":"box","text":"private negotiated transactions between the issuer and their purchasers, such as the Funds, and may be neither","page_number":114,"box":{"x":70,"y":823,"width":802,"height":12}},{"id":"b3ac39b0-d884-49f2-86d1-8ae0b4465081","block_type":"box","text":"listed on an exchange nor traded in other established markets. In many cases, privately placed securities may not be","page_number":114,"box":{"x":70,"y":839,"width":834,"height":11}},{"id":"9be7eb7b-91da-4113-9d6b-78a39d41faf1","block_type":"box","text":"freely transferable under the laws of the applicable jurisdiction or due to contractual restrictions on resale. Some of","page_number":114,"box":{"x":68,"y":853,"width":825,"height":12}},{"id":"da0e32d8-68a8-4caf-8801-953bb1d94a79","block_type":"box","text":"these securities are new and complex, and trade only among institutions; the markets for these securities are still","page_number":114,"box":{"x":68,"y":869,"width":815,"height":11}},{"id":"9206d82b-2ec0-4c80-9b6a-949decd33e15","block_type":"box","text":"developing, and may not function as efficiently as established markets. Typically, investments in private companies","page_number":114,"box":{"x":69,"y":884,"width":821,"height":11}},{"id":"e3e0342f-03a5-4440-9382-8f738b6e77c3","block_type":"box","text":"are in restricted securities that are not traded in public markets and subject to substantial holding periods, so that a","page_number":114,"box":{"x":69,"y":899,"width":831,"height":11}},{"id":"77836c9f-e353-478c-9bcb-1f94908d006a","block_type":"box","text":"II-70","page_number":114,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"424970a2-7e49-4462-b7f5-a4a253f177ad","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":114,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"32eb5309-5bdc-43b0-b0ff-ad35c1bfd518","block_type":"box","text":"Fund may not be able to resell some of its holdings for extended periods, which may be several years. There can be","page_number":115,"box":{"x":70,"y":45,"width":824,"height":11}},{"id":"63b029de-c92b-4efd-a5c3-b7c0b3f8bb9c","block_type":"box","text":"no assurance that a Fund will be able to realize the value of such restricted securities in a timely manner or at all. As","page_number":115,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"0853f93d-c005-4b09-8563-17db123af86f","block_type":"box","text":"a result of the absence of a public trading market and the potential bespoke nature on cer tain transactions,","page_number":115,"box":{"x":69,"y":75,"width":769,"height":11}},{"id":"598b8485-0b7d-441a-acd4-2859e0f79bc9","block_type":"box","text":"restricted securities may be deemed to be illiquid investments or less liquid investments and may be more difficult to","page_number":115,"box":{"x":69,"y":90,"width":838,"height":11}},{"id":"c528c97a-fc81-4f8d-9bbd-7afb16711448","block_type":"box","text":"value than publicly traded securities. To the extent that restricted securities may be resold in privately negotiated","page_number":115,"box":{"x":68,"y":105,"width":805,"height":11}},{"id":"cd773e14-1810-44e2-a368-4c1f7c0fb53e","block_type":"box","text":"transactions, the prices realized from the sales, due to lack of liquidity, could be less than those originally paid by the","page_number":115,"box":{"x":68,"y":120,"width":840,"height":12}},{"id":"1298bd17-3cf0-444b-a827-9838314bf86d","block_type":"box","text":"Fund or less than their fair market value. The amount of any discount may vary depending on the security type, the","page_number":115,"box":{"x":70,"y":135,"width":815,"height":12}},{"id":"9979dc4b-ea05-4671-9c2e-0130af7f249e","block_type":"box","text":"character of the issuer, which par ty (if any) will bear the expenses of registering the restricted security, and prevailing","page_number":115,"box":{"x":69,"y":150,"width":835,"height":12}},{"id":"67a53a64-9e10-4b83-8236-fdd95789d391","block_type":"box","text":"market conditions. In addition, issuers whose securities are not publicly traded or who are not otherwise publicly","page_number":115,"box":{"x":69,"y":166,"width":803,"height":11}},{"id":"594427f6-680f-4d08-9e9a-1140a6f06db2","block_type":"box","text":"listed may not be subject to the disclosure and other investor protection requirements that may be applicable if their","page_number":115,"box":{"x":70,"y":181,"width":830,"height":11}},{"id":"bbe7088a-9fd9-4235-8c7b-762af2ba5f9a","block_type":"box","text":"securities were publicly traded. If any privately placed securities held by a Fund are required to be registered under","page_number":115,"box":{"x":69,"y":196,"width":817,"height":11}},{"id":"e402f695-b77c-4123-9063-78ad22f9c43a","block_type":"box","text":"the securities laws of one or more jurisdictions before being resold, the Fund may be required to bear the expenses","page_number":115,"box":{"x":68,"y":211,"width":825,"height":11}},{"id":"e86cd0fc-14a7-44c7-a308-67ca95071b03","block_type":"box","text":"of registration. Where registration is required for restricted securities, a considerable time period may elapse","page_number":115,"box":{"x":69,"y":226,"width":777,"height":11}},{"id":"b641f871-0e20-4f65-a4db-4350de7b8b88","block_type":"box","text":"between the time the Fund decides to sell the security and the time it is actually permitted to sell the security under","page_number":115,"box":{"x":69,"y":241,"width":828,"height":11}},{"id":"b2e965f5-3740-42ad-abaa-c5a5992be7ee","block_type":"box","text":"an effective registration statement. If during such period, adverse market conditions were to develop, the Fund might","page_number":115,"box":{"x":69,"y":256,"width":834,"height":12}},{"id":"53e6185f-72ec-4ba9-9788-b5afffe88d81","block_type":"box","text":"obtain less favorable pricing terms than when it decided to sell the security. In addition, the Fund may be deemed to","page_number":115,"box":{"x":69,"y":271,"width":828,"height":12}},{"id":"02924a98-0b36-4145-bcda-43d7abbbc149","block_type":"box","text":"be an “underwriter” for purposes of the Securities Act when selling restricted securities. If so, the Fund may be liable","page_number":115,"box":{"x":69,"y":286,"width":836,"height":12}},{"id":"408e9e4f-86f0-4edc-87bf-132f4d65adc2","block_type":"box","text":"to purchasers of the restricted securities if the registration statement prepared by the issuer, or the corresponding","page_number":115,"box":{"x":68,"y":302,"width":819,"height":11}},{"id":"ef60cebe-aef1-4d8d-9ab3-9ccdd76f0e3e","block_type":"box","text":"prospectus, is materially inaccurate or misleading. Transactions in restricted securities may entail other transaction","page_number":115,"box":{"x":70,"y":317,"width":822,"height":11}},{"id":"445a516e-1ba9-4932-b331-fef66f1bf552","block_type":"box","text":"costs that are higher than those for transactions in unrestricted securities. Cer tain of the Fund’s investments in","page_number":115,"box":{"x":69,"y":332,"width":798,"height":11}},{"id":"30baaa53-faa2-4747-ba20-1dfa4bf92a84","block_type":"box","text":"private placements may consist of direct investments and may include investments in smaller, less seasoned","page_number":115,"box":{"x":70,"y":347,"width":780,"height":11}},{"id":"10a2621b-25d5-406b-93f9-2104fb235d6f","block_type":"box","text":"issuers, which may involve greater risks. Issuers of restricted securities may not be subject to SEC repor ting","page_number":115,"box":{"x":70,"y":362,"width":773,"height":11}},{"id":"de66f122-8250-4adb-800b-ba59c8f71910","block_type":"box","text":"requirements, may not be required to maintain their accounting records in accordance with generally accepted","page_number":115,"box":{"x":69,"y":377,"width":784,"height":12}},{"id":"75c4f772-1e8e-4413-8df1-1da99e8e9041","block_type":"box","text":"accounting principles, and may not be required to maintain effective internal controls over financial repor ting. As a","page_number":115,"box":{"x":69,"y":392,"width":816,"height":12}},{"id":"8021913b-daa2-4fe3-bb7a-3b8163bb938b","block_type":"box","text":"result, BlackRock may not have timely or accurate information about the business, financial condition and results of","page_number":115,"box":{"x":69,"y":407,"width":828,"height":12}},{"id":"2faf634a-a221-4d2b-b731-9bddfc93a9da","block_type":"box","text":"operations of such issuers, and investments in securities of such issuers may involve a high degree of business and","page_number":115,"box":{"x":69,"y":423,"width":831,"height":11}},{"id":"20e1b106-7d9e-4ff5-9819-ff10e1af1707","block_type":"box","text":"financial risk and may result in substantial losses to the Fund. Such issuers may also have limited product lines,","page_number":115,"box":{"x":68,"y":438,"width":804,"height":11}},{"id":"d477326a-f746-43ac-b8fd-ec88da7a43d5","block_type":"box","text":"markets or financial resources, or they may be dependent on a limited management group.","page_number":115,"box":{"x":69,"y":453,"width":647,"height":11}},{"id":"1c5a42f1-d385-414e-8b6a-8370ef113b3f","block_type":"box","text":"Cer tain restricted securities may represent limited investment oppor tunities and each shareholder’s","page_number":115,"box":{"x":102,"y":476,"width":714,"height":11}},{"id":"1f0fd421-0d37-41ee-9cd2-e5b7f41d58ed","block_type":"box","text":"propor tionate investment exposure to such limited investment oppor tunities may be reduced propor tionately as the","page_number":115,"box":{"x":70,"y":491,"width":823,"height":11}},{"id":"3bacc54a-29b2-45ca-9b64-91dfc0625b10","block_type":"box","text":"Fund’s net assets grow from new or additional investments made in the Fund by other shareholders. The issuer of a","page_number":115,"box":{"x":70,"y":506,"width":826,"height":11}},{"id":"b32c20ad-e6c1-41f2-ab4d-9a13229db1ec","block_type":"box","text":"private placement may later register those shares for public sale in an IPO, but there is no guarantee that an IPO will","page_number":115,"box":{"x":70,"y":521,"width":830,"height":11}},{"id":"684502e4-4c05-4825-b9fd-5e56f741f943","block_type":"box","text":"ever be completed. Even after an IPO, there may be a limited trading market for securities of that issuer, including","page_number":115,"box":{"x":69,"y":536,"width":812,"height":11}},{"id":"ec303f36-0c64-4d31-9b72-21ee582ad650","block_type":"box","text":"any direct investment by a Fund, or the Fund may be subject to contractual limitations on its ability to resell its","page_number":115,"box":{"x":69,"y":551,"width":787,"height":11}},{"id":"696fd66f-a6df-49af-a610-eb187b3e45ef","block_type":"box","text":"existing securities following an IPO. The inability of an applicable issuer of a restricted security to complete an IPO or","page_number":115,"box":{"x":69,"y":566,"width":833,"height":11}},{"id":"5a57cad1-e886-452d-a985-91d082d907ab","block_type":"box","text":"offer other liquidity oppor tunities to the Fund and other investors will extend the holding period of a Fund’s","page_number":115,"box":{"x":69,"y":581,"width":759,"height":12}},{"id":"1a0b5cc0-eb5d-4d97-9496-89d1a3062b26","block_type":"box","text":"investments, potentially indefinitely, and may adversely affect the value of the investments. In making investments in","page_number":115,"box":{"x":70,"y":596,"width":833,"height":12}},{"id":"a36fca4d-1428-4670-87f3-cb7822fe8e63","block_type":"box","text":"such securities, a Fund may obtain access to material nonpublic information, which may restrict the Fund’s ability to","page_number":115,"box":{"x":69,"y":612,"width":828,"height":11}},{"id":"ce08e55b-c0a2-4d59-b1f4-22aacd3d4bab","block_type":"box","text":"conduct por tfolio transactions in such securities. The activity of identifying, completing, and realizing upon attractive","page_number":115,"box":{"x":69,"y":627,"width":827,"height":11}},{"id":"72e06d6e-ac24-43ba-b6d5-b42892745a07","block_type":"box","text":"investments in restricted securities is highly competitive and involves a high degree of uncer tainty. A Fund will be","page_number":115,"box":{"x":70,"y":642,"width":804,"height":11}},{"id":"dcff1092-b67e-4449-9d47-8376fdc1ae84","block_type":"box","text":"competing for investments against other similarly situated investors. It is possible that competition for appropriate","page_number":115,"box":{"x":69,"y":657,"width":816,"height":11}},{"id":"52519a83-0402-4c5c-bded-98845a1f7ccf","block_type":"box","text":"investment oppor tunities may increase, thus potentially reducing the number of investment oppor tunities available to","page_number":115,"box":{"x":70,"y":672,"width":835,"height":11}},{"id":"52694b16-48d4-4fc8-8163-3b8d0023fb04","block_type":"box","text":"a Fund and adversely affecting the terms upon which investments can be made. There is no assurance that","page_number":115,"box":{"x":69,"y":687,"width":768,"height":11}},{"id":"4a009bff-c2cd-4694-8ef0-c8856ca4ec8f","block_type":"box","text":"investment oppor tunities for restricted securities will be available at any given time or at a level desired by a Fund,","page_number":115,"box":{"x":70,"y":702,"width":815,"height":12}},{"id":"d642dc0f-4d43-4249-a3fa-ccdd75ad8db8","block_type":"box","text":"especially as that Fund grows in size.","page_number":115,"box":{"x":69,"y":718,"width":264,"height":11}},{"id":"dc910396-063f-4e0e-9bf7-beb196d39e8b","block_type":"box","text":"There may not be a readily available market value for a Fund’s restricted securities (in par ticular, restricted","page_number":115,"box":{"x":101,"y":740,"width":762,"height":11}},{"id":"252bcf4f-1a83-4818-ad84-e9799c34c20c","block_type":"box","text":"securities issued by private companies) and thus they may be considered “illiquid”. Each Fund values restricted","page_number":115,"box":{"x":69,"y":755,"width":795,"height":11}},{"id":"1d64b1fb-aad1-42ff-ae10-674279ee4dd4","block_type":"box","text":"securities in accordance with BlackRock’s valuation policies and procedures, which are designed to value","page_number":115,"box":{"x":69,"y":771,"width":751,"height":11}},{"id":"acc5b64b-b38e-470f-aa02-3acf3e352f38","block_type":"box","text":"investments such that they accurately reflect fair value. Due to the inherent uncer tainty and subjectivity of","page_number":115,"box":{"x":70,"y":785,"width":755,"height":12}},{"id":"2f256a5b-57a0-4f39-a7e5-ba5ffcf119a0","block_type":"box","text":"determining the fair value of investments that do not have a readily available market value, the fair value of a Fund’s","page_number":115,"box":{"x":69,"y":801,"width":830,"height":11}},{"id":"12055fc9-0d20-4c98-99a8-75cbfa2058ce","block_type":"box","text":"private investments may differ significantly from the values that would have been used had a readily available market","page_number":115,"box":{"x":70,"y":816,"width":835,"height":11}},{"id":"67d088ae-a62a-4270-b737-243187d4c830","block_type":"box","text":"value existed for such investments and may differ materially from the amounts the Fund may realize on any","page_number":115,"box":{"x":68,"y":831,"width":766,"height":11}},{"id":"ec713efb-19b0-461f-9209-44cb3835e542","block_type":"box","text":"dispositions of such investments. Differences in the value of the Fund’s private investments could result in the","page_number":115,"box":{"x":69,"y":846,"width":792,"height":11}},{"id":"3573ef99-1a9e-42df-96ad-433f15ed5b7e","block_type":"box","text":"Fund’s shareholder transactions being effected at a NAV that does not accurately reflect the underlying value of the","page_number":115,"box":{"x":70,"y":861,"width":821,"height":11}},{"id":"d0dc8aec-cfc5-4303-b0d6-164f06a3997b","block_type":"box","text":"Fund’s por tfolio, potentially resulting in the dilution of shareholder interests and increasing oppor tunities for","page_number":115,"box":{"x":70,"y":876,"width":771,"height":11}},{"id":"972f83fc-825d-4318-8698-e94894d6a93c","block_type":"box","text":"shareholder arbitrage. The values used by the Fund to price its restricted securities may also differ from those used","page_number":115,"box":{"x":69,"y":891,"width":826,"height":12}},{"id":"63de5bc5-c962-46ca-a2b4-3ffcd7f8c03c","block_type":"box","text":"by other investment companies and investors to price the same restricted securities. In addition, the impact of","page_number":115,"box":{"x":69,"y":906,"width":790,"height":12}},{"id":"1d885a81-fc46-41d6-967c-5eb61c7095cd","block_type":"box","text":"II-71","page_number":115,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3c80bf0c-d2d3-45fa-aed0-38eef269df71","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":115,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"c1edc560-13da-45d0-893f-0a5235e18552","block_type":"box","text":"changes in the market environment and other events on the fair values of a Fund’s investments that have no readily","page_number":116,"box":{"x":69,"y":45,"width":828,"height":11}},{"id":"0fcb10d4-ef3f-480d-842d-628076a1b30f","block_type":"box","text":"available market values may differ from the impact of such changes on the readily available market values for the","page_number":116,"box":{"x":69,"y":60,"width":810,"height":11}},{"id":"81df03ef-9a47-4335-9dbf-4cbb5e0c158b","block_type":"box","text":"Fund’s other investments. A Fund’s NAV could be adversely affected if the Fund’s determinations regarding the fair","page_number":116,"box":{"x":70,"y":75,"width":818,"height":11}},{"id":"409c259f-33c2-4094-a50f-8ce24de71185","block_type":"box","text":"value of the Fund’s investments were materially higher than the investment’s actual market or fair value or the values","page_number":116,"box":{"x":68,"y":90,"width":839,"height":11}},{"id":"0cf0db7c-fba9-4681-9e11-77675305f16f","block_type":"box","text":"that the Fund ultimately realizes upon the disposal of such investments.","page_number":116,"box":{"x":68,"y":105,"width":514,"height":11}},{"id":"6a20b263-20af-4c84-871a-4d1671c48a71","block_type":"box","text":"See also risks discussed under “Illiquid Investments.”","page_number":116,"box":{"x":102,"y":128,"width":385,"height":11}},{"id":"6e39e3f7-c204-441c-abc3-405e84da402a","block_type":"box","text":"Reverse Repurchase Agreements.","page_number":116,"box":{"x":102,"y":151,"width":246,"height":11}},{"id":"35864b60-2416-4e64-b5f0-519658e7ce63","block_type":"box","text":"A Fund may enter into reverse repurchase agreements with the same par ties","page_number":116,"box":{"x":354,"y":151,"width":548,"height":11}},{"id":"22d09053-bfba-418d-9b40-7f3527a24e48","block_type":"box","text":"with whom it may enter into repurchase agreements. Under a reverse repurchase agreement, a Fund sells securities","page_number":116,"box":{"x":68,"y":166,"width":830,"height":11}},{"id":"0b2b1e25-bae7-4263-bbe6-b45ef607505e","block_type":"box","text":"to another par ty and agrees to repurchase them at a par ticular date and price. A Fund may enter into a reverse","page_number":116,"box":{"x":68,"y":181,"width":793,"height":11}},{"id":"45a684ae-cdec-46ea-bae1-9d6890ccf121","block_type":"box","text":"repurchase agreement when it is anticipated that the interest income to be earned from the investment of the","page_number":116,"box":{"x":69,"y":196,"width":784,"height":11}},{"id":"ced7d799-5527-4302-80d8-8a4a8d2b6e3a","block_type":"box","text":"proceeds of the transaction is greater than the interest expense of the transaction.","page_number":116,"box":{"x":70,"y":211,"width":591,"height":11}},{"id":"5ebdba35-847b-4cd7-8abc-425fad9bd32d","block_type":"box","text":"The use of reverse repurchase agreements may be regarded as leveraging and, therefore, speculative.","page_number":116,"box":{"x":101,"y":234,"width":730,"height":11}},{"id":"7130be0c-a81d-422d-bae5-2a5286d2a6e8","block_type":"box","text":"Fur thermore, reverse repurchase agreements involve the risks that (i) the interest income earned in the investment","page_number":116,"box":{"x":70,"y":249,"width":822,"height":11}},{"id":"4215c3d9-a45d-49e4-81f7-c6c9f050160c","block_type":"box","text":"of the proceeds will be less than the interest expense, (ii) the market value of the securities retained in lieu of sale","page_number":116,"box":{"x":69,"y":264,"width":821,"height":11}},{"id":"277f1231-1626-4edd-83e6-b31daafc96fa","block_type":"box","text":"by a Fund may decline below the price of the securities the Fund has sold but is obligated to repurchase, (iii) the","page_number":116,"box":{"x":69,"y":279,"width":801,"height":11}},{"id":"ecba9d55-d77c-4fcf-8b0f-4eb41d8cb982","block_type":"box","text":"market value of the securities sold will decline below the price at which the Fund is required to repurchase them and","page_number":116,"box":{"x":69,"y":294,"width":830,"height":11}},{"id":"bc83e562-3c66-49e2-8b4e-155938913fe9","block_type":"box","text":"(iv) the securities will not be returned to the Fund.","page_number":116,"box":{"x":69,"y":309,"width":354,"height":11}},{"id":"cfd118bb-5ae3-40f6-b81d-e644edd5349d","block_type":"box","text":"In addition, if the buyer of securities under a reverse repurchase agreement files for bankruptcy or becomes","page_number":116,"box":{"x":102,"y":332,"width":769,"height":11}},{"id":"cc5b5ad8-cd05-481e-b246-e5c2628809ed","block_type":"box","text":"insolvent, such buyer or its trustee or receiver may receive an extension of time to determine whether to enforce a","page_number":116,"box":{"x":70,"y":347,"width":815,"height":11}},{"id":"41584f69-33fb-4678-a5ab-4c05d506ed0e","block_type":"box","text":"Fund’s obligations to repurchase the securities and the Fund’s use of the proceeds of the reverse repurchase","page_number":116,"box":{"x":70,"y":362,"width":782,"height":11}},{"id":"8c4e7c6a-179c-4f7a-bc7a-8a56f41ac932","block_type":"box","text":"agreement may effectively be restricted pending such decision.","page_number":116,"box":{"x":69,"y":377,"width":449,"height":12}},{"id":"58c18557-f89c-4f8a-9a46-bb18f5f0cdf4","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into reverse repurchase agreements and","page_number":116,"box":{"x":102,"y":400,"width":794,"height":11}},{"id":"83d887fb-cd58-45b1-9166-84fa2e3a6121","block_type":"box","text":"similar financing transactions (","page_number":116,"box":{"x":69,"y":415,"width":218,"height":11}},{"id":"54e46afa-3699-471b-b640-54608c4aa17a","block_type":"box","text":"e.g.","page_number":116,"box":{"x":289,"y":417,"width":24,"height":9}},{"id":"e90f0116-24ee-4af8-b5d5-6b5dbc65e054","block_type":"box","text":", recourse and non-recourse tender option bonds, borrowed bonds) notwithstanding","page_number":116,"box":{"x":316,"y":415,"width":594,"height":11}},{"id":"c95340db-2f66-4935-95ee-2e5cbbc3f9cc","block_type":"box","text":"the limitation on the issuance of senior securities in Section 18 of the Investment Company Act, provided that the","page_number":116,"box":{"x":68,"y":430,"width":813,"height":11}},{"id":"fbbc69c2-df5b-4ec8-b0b8-aeda88be9263","block_type":"box","text":"Fund either (i) complies with the 300% asset coverage ratio with respect to all such transactions and any other","page_number":116,"box":{"x":70,"y":445,"width":789,"height":12}},{"id":"b4d30142-7b43-4258-b8e3-ab8dfe9f7670","block_type":"box","text":"borrowings in the aggregate, or (ii) treats all such transactions as Derivatives Transactions under Rule 18f-4. See “—","page_number":116,"box":{"x":69,"y":460,"width":836,"height":12}},{"id":"b8585d91-7c16-45b0-b3d4-970d76a1348d","block_type":"box","text":"Derivatives — Regulation of Derivatives — Rule 18f-4 under the Investment Company Act” above. The SEC has also","page_number":116,"box":{"x":70,"y":475,"width":824,"height":12}},{"id":"2f69f01d-b116-42a4-9159-9a98b08962f1","block_type":"box","text":"finalized rules that will require cer tain transactions involving U.S. Treasuries, including reverse repurchase","page_number":116,"box":{"x":68,"y":491,"width":758,"height":11}},{"id":"eae4e276-f4e6-43bd-91de-598e6ddada1f","block_type":"box","text":"agreements, to be centrally cleared. Compliance with these rules is expected to be required by the middle of 2027.","page_number":116,"box":{"x":69,"y":506,"width":822,"height":11}},{"id":"29d3ffd8-4c63-4a54-a19f-dc0474571fd0","block_type":"box","text":"Although the impact of these rules on the Funds is difficult to predict, they may reduce the availability or increase the","page_number":116,"box":{"x":68,"y":521,"width":838,"height":11}},{"id":"59cfd6c3-96c1-41d9-b4c6-e20752065d41","block_type":"box","text":"costs of such transactions and may adversely affect a Fund’s per formance.","page_number":116,"box":{"x":69,"y":536,"width":538,"height":11}},{"id":"b7a0c120-9c0c-482b-b10a-5e9388a0687d","block_type":"box","text":"Additionally, regulations adopted by global prudential regulators require cer tain bank-regulated counterpar ties","page_number":116,"box":{"x":101,"y":559,"width":780,"height":11}},{"id":"ea797087-1af8-42a4-95ef-04c0c354e9be","block_type":"box","text":"and cer tain of their affiliates to include in cer tain financial contracts, including many reverse repurchase agreements,","page_number":116,"box":{"x":69,"y":574,"width":838,"height":11}},{"id":"b2710c8e-859f-414f-ab22-f25a8a504e15","block_type":"box","text":"terms that delay or restrict the rights of counterpar ties, such as a Fund, to terminate such agreements, take","page_number":116,"box":{"x":68,"y":589,"width":775,"height":11}},{"id":"6a9fd0d8-3225-45ea-8030-8086fbd15f3f","block_type":"box","text":"foreclosure action, exercise other default rights or restrict transfers of credit suppor t in the event that the","page_number":116,"box":{"x":68,"y":604,"width":754,"height":11}},{"id":"307a38b0-44b6-4028-91f1-c2011a4598be","block_type":"box","text":"counterpar ty and/or its affiliates are subject to cer tain types of resolution or insolvency proceedings. It is possible","page_number":116,"box":{"x":69,"y":619,"width":818,"height":11}},{"id":"69fa5437-e056-464a-b223-e447ce1e16a0","block_type":"box","text":"that these requirements, as well as potential additional government regulation and other developments in the","page_number":116,"box":{"x":68,"y":634,"width":783,"height":12}},{"id":"dbaf5279-ca7d-442d-b0e4-f2eea05be07b","block_type":"box","text":"market, could adversely affect a Fund’s ability to terminate existing reverse repurchase agreements or to realize","page_number":116,"box":{"x":69,"y":649,"width":800,"height":12}},{"id":"144c778c-6bd2-482b-9533-44e85be25f54","block_type":"box","text":"amounts to be received under such agreements.","page_number":116,"box":{"x":69,"y":665,"width":345,"height":11}},{"id":"f642687b-c112-4bad-bd38-51d7e2fa0bfa","block_type":"box","text":"Rights Offerings and Warrants to Purchase.","page_number":116,"box":{"x":102,"y":687,"width":316,"height":11}},{"id":"5a8660f4-eb71-4e17-82ac-0342f441ecaa","block_type":"box","text":"Cer tain Funds may par ticipate in rights offerings and may purchase","page_number":116,"box":{"x":424,"y":687,"width":481,"height":11}},{"id":"4c962513-b2f1-4e84-b29a-567a5123a6e6","block_type":"box","text":"warrants, which are privileges issued by corporations enabling the owners to subscribe to and purchase a specified","page_number":116,"box":{"x":68,"y":702,"width":822,"height":12}},{"id":"42214514-e154-4038-87fe-bd2144054a36","block_type":"box","text":"number of shares of the corporation at a specified price during a specified period of time. Subscription rights","page_number":116,"box":{"x":69,"y":717,"width":776,"height":12}},{"id":"23d610f7-e131-4efb-bb7c-1ffa5b8358d3","block_type":"box","text":"normally have a shor t life span to expiration. The purchase of rights or warrants involves the risk that a Fund could","page_number":116,"box":{"x":69,"y":732,"width":817,"height":12}},{"id":"1719e375-1a4d-41b7-92e4-d007a74eb7d0","block_type":"box","text":"lose the purchase value of a right or warrant if the right to subscribe to additional shares is not exercised prior to the","page_number":116,"box":{"x":70,"y":748,"width":833,"height":11}},{"id":"b1f7fe15-922e-4c82-9c52-588df9927fe1","block_type":"box","text":"rights’ and warrants’ expiration. Also, the purchase of rights and/or warrants involves the risk that the effective price","page_number":116,"box":{"x":69,"y":763,"width":835,"height":11}},{"id":"7f162610-13b2-414c-af82-a8c6f52f6a4c","block_type":"box","text":"paid for the right and/or warrant added to the subscription price of the related security may exceed the value of the","page_number":116,"box":{"x":70,"y":778,"width":821,"height":11}},{"id":"198a1da9-df79-4fa0-bdc5-1723ff555b16","block_type":"box","text":"subscribed security’s market price such as when there is no movement in the level of the underlying security. Buying","page_number":116,"box":{"x":69,"y":793,"width":830,"height":11}},{"id":"e92575c1-9655-4483-8a6b-dc16b3c0d11f","block_type":"box","text":"a warrant does not make the Fund a shareholder of the underlying stock. The warrant holder has no voting or","page_number":116,"box":{"x":69,"y":808,"width":777,"height":11}},{"id":"228bbdaf-aca5-42da-a204-eb9f02924af6","block_type":"box","text":"dividend rights with respect to the underlying stock. A warrant does not carry any right to assets of the issuer, and for","page_number":116,"box":{"x":69,"y":823,"width":839,"height":12}},{"id":"a6d396c9-ef8d-4d59-8f36-552a0d456620","block_type":"box","text":"this reason investments in warrants may be more speculative than other equity-based investments.","page_number":116,"box":{"x":68,"y":839,"width":708,"height":10}},{"id":"07f2f7a0-8d60-48c3-b1a4-ccf327afe2fa","block_type":"box","text":"Rule 144A Securities.","page_number":116,"box":{"x":102,"y":861,"width":159,"height":9}},{"id":"042b0171-b2cf-42ef-a8ee-d36be93a65f8","block_type":"box","text":"A Fund may purchase securities that can be offered and sold only to “qualified","page_number":116,"box":{"x":266,"y":861,"width":560,"height":11}},{"id":"b899dbe8-64c7-48b3-9e59-edf51efe15d6","block_type":"box","text":"institutional buyers” pursuant to Rule 144A under the Securities Act. See “Restricted Securities” above.","page_number":116,"box":{"x":70,"y":876,"width":741,"height":11}},{"id":"cb1697f8-6ed0-41ef-a017-100e89697dae","block_type":"box","text":"II-72","page_number":116,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"5a038fc0-e2fa-454e-a938-977ba3d6760a","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":116,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"a254c3b5-b076-4d26-8c3c-94b5630dacc7","block_type":"box","text":"Securities Lending.","page_number":117,"box":{"x":101,"y":45,"width":139,"height":11}},{"id":"09465d80-0b79-4863-af74-4ea5450facd9","block_type":"box","text":"Each Fund may lend por tfolio securities to cer tain borrowers that BlackRock determines to","page_number":117,"box":{"x":247,"y":45,"width":645,"height":11}},{"id":"5363006a-dce7-4ba0-b5f7-10b235f1b931","block_type":"box","text":"be creditwor thy, including borrowers affiliated with BlackRock. The borrowers provide collateral that is maintained in","page_number":117,"box":{"x":69,"y":60,"width":825,"height":11}},{"id":"9289e84e-b11c-4cab-8c6c-7e24b1ec0e03","block_type":"box","text":"an amount at least equal to the current market value of the securities loaned. No securities loan shall be made on","page_number":117,"box":{"x":69,"y":75,"width":817,"height":11}},{"id":"24e47eeb-a2a4-4132-ab92-042f33b465c1","block_type":"box","text":"behalf of a Fund if, as a result, the aggregate value of all securities loans of the par ticular Fund exceeds one-third of","page_number":117,"box":{"x":69,"y":90,"width":831,"height":11}},{"id":"2297d317-d368-41b2-b8c9-714c247aa258","block_type":"box","text":"the value of such Fund’s total assets (including the value of the collateral received). A Fund may terminate a loan at","page_number":117,"box":{"x":68,"y":105,"width":827,"height":11}},{"id":"a68809a6-b7d1-4464-95a7-954c9d2f9ea5","block_type":"box","text":"any time and obtain the return of the securities loaned. Each Fund receives, by way of substitute payment, the value","page_number":117,"box":{"x":69,"y":120,"width":829,"height":11}},{"id":"1a7987c0-88e9-4e56-9d1c-9a04ec27ddf9","block_type":"box","text":"of any interest or cash or non-cash distributions paid on the loaned securities that it would have otherwise received if","page_number":117,"box":{"x":69,"y":135,"width":838,"height":11}},{"id":"07423e64-cb94-4bc5-bf17-73c4022b47dd","block_type":"box","text":"the securities were not on loan.","page_number":117,"box":{"x":68,"y":151,"width":225,"height":8}},{"id":"88e40114-2d88-46c8-9338-4b8e244e84a9","block_type":"box","text":"With respect to loans that are collateralized by cash, the borrower may be entitled to receive a fee based on the","page_number":117,"box":{"x":101,"y":173,"width":799,"height":11}},{"id":"aa44598e-e002-46f9-a6f6-b8b6ee7f760b","block_type":"box","text":"amount of cash collateral. The Funds are compensated by any positive difference between the amount earned on the","page_number":117,"box":{"x":69,"y":188,"width":835,"height":11}},{"id":"0bbcd230-2342-4c78-87e3-7fa71f584814","block_type":"box","text":"reinvestment of cash collateral and the fee paid to the borrower. In the case of collateral other than cash, a Fund is","page_number":117,"box":{"x":69,"y":203,"width":824,"height":11}},{"id":"c44440bf-7f20-4b23-9c0e-9c6265424e97","block_type":"box","text":"compensated by a fee paid by the borrower equal to a percentage of the market value of the loaned securities. Any","page_number":117,"box":{"x":69,"y":218,"width":821,"height":12}},{"id":"766bf876-e365-4da1-88e4-1f224f773285","block_type":"box","text":"cash collateral received by the Fund for such loans, and uninvested cash, may be reinvested in cer tain shor t-term","page_number":117,"box":{"x":69,"y":234,"width":810,"height":11}},{"id":"231cf995-dd7d-44ae-a193-4e47d7e94007","block_type":"box","text":"instruments either directly on behalf of the Fund or through one or more joint accounts or money market funds,","page_number":117,"box":{"x":70,"y":249,"width":789,"height":11}},{"id":"ee972e7f-5a59-45c4-a7e2-62bc8f0b256a","block_type":"box","text":"including those affiliated with BlackRock; such investments are subject to investment risk.","page_number":117,"box":{"x":70,"y":264,"width":643,"height":11}},{"id":"a828a417-12a9-4191-bb36-1fd9db1ce910","block_type":"box","text":"Securities lending involves exposure to cer tain risks, including operational risk (","page_number":117,"box":{"x":102,"y":287,"width":568,"height":11}},{"id":"5d2beb39-a0c5-4038-b702-60c40f72f7bd","block_type":"box","text":"i.e.","page_number":117,"box":{"x":672,"y":287,"width":20,"height":9}},{"id":"39c96c3c-bdbc-4cf0-9f09-31f2f42e9b0c","block_type":"box","text":", the risk of losses resulting","page_number":117,"box":{"x":695,"y":286,"width":198,"height":12}},{"id":"fe68edc1-9669-466c-beb5-954b8c61f34d","block_type":"box","text":"from problems in the settlement and accounting process), “gap” risk (","page_number":117,"box":{"x":68,"y":302,"width":501,"height":11}},{"id":"5a8e5b48-687e-4953-b3fd-5f8ca5309a38","block_type":"box","text":"i.e.","page_number":117,"box":{"x":571,"y":302,"width":20,"height":9}},{"id":"d24c4ccf-e8ab-46a6-ae4b-a37318be982d","block_type":"box","text":", the risk of a mismatch between the return","page_number":117,"box":{"x":594,"y":302,"width":307,"height":10}},{"id":"940c5550-d3db-4395-b04a-9ab123e09957","block_type":"box","text":"on cash collateral reinvestments and the fees each Fund has agreed to pay a borrower), foreign exchange risk (","page_number":117,"box":{"x":69,"y":317,"width":794,"height":11}},{"id":"2a4225ca-268d-4861-9a84-3418e172d644","block_type":"box","text":"i.e.","page_number":117,"box":{"x":865,"y":317,"width":20,"height":9}},{"id":"bb394ea6-9f82-4070-a029-7b06c39d4f8c","block_type":"box","text":",","page_number":117,"box":{"x":888,"y":324,"width":2,"height":3}},{"id":"a0c9c4d1-1f1c-444e-a653-68259343c242","block_type":"box","text":"the risk of a shor tfall at default when a cash collateral investment is denominated in a currency other than the","page_number":117,"box":{"x":68,"y":332,"width":788,"height":11}},{"id":"b43e2579-a767-4b06-b782-4075be7d72e5","block_type":"box","text":"currency of the assets being loaned due to movements in foreign exchange rates), and credit, legal, counterpar ty and","page_number":117,"box":{"x":69,"y":347,"width":837,"height":11}},{"id":"eaadef14-5621-4235-b9fc-8e7e2bd004ca","block_type":"box","text":"market risks (including the risk that market events, including but not limited to corporate actions, could lead a Fund","page_number":117,"box":{"x":69,"y":362,"width":822,"height":11}},{"id":"0b67946c-db94-4717-aeb7-864ff52d983f","block_type":"box","text":"to lend securities that are trading at a premium due to increased demand, or to recall loaned securities or to lend","page_number":117,"box":{"x":68,"y":377,"width":811,"height":12}},{"id":"1012852d-3ad8-43d8-ab27-0a9a18565a9d","block_type":"box","text":"less or not at all, which could lead to reduced securities lending revenue). If a Fund were to lend out securities that","page_number":117,"box":{"x":70,"y":392,"width":820,"height":12}},{"id":"bf660da1-1fda-4cb1-8bc4-0abe7def9304","block_type":"box","text":"are subject to a corporate action and commit to the borrower a par ticular election as determined by the Fund’s","page_number":117,"box":{"x":69,"y":408,"width":790,"height":11}},{"id":"c433ab86-5e08-45d5-9881-a05357e420a1","block_type":"box","text":"investment adviser, the benefit the Fund would receive in respect of committing to such election may or may not be","page_number":117,"box":{"x":70,"y":423,"width":820,"height":11}},{"id":"13cb3ff8-35dc-4d0b-b920-e36fdb80c275","block_type":"box","text":"less than the benefit the Fund would have received from making a different election in such corporate action. If a","page_number":117,"box":{"x":70,"y":438,"width":805,"height":11}},{"id":"06d09925-69f9-45e4-88bf-6c3c9a214f66","block_type":"box","text":"securities lending counterpar ty were to default, a Fund would be subject to the risk of a possible delay in receiving","page_number":117,"box":{"x":69,"y":453,"width":816,"height":11}},{"id":"c2f2173c-4f7d-4292-836d-3c6ffdc51ae0","block_type":"box","text":"collateral or in recovering the loaned securities, or to a possible loss of rights in the collateral. In the event a","page_number":117,"box":{"x":69,"y":468,"width":775,"height":11}},{"id":"135d4ce2-1b46-4362-9121-f8ae13fcd186","block_type":"box","text":"borrower does not return a Fund’s securities as agreed, the Fund’s ability to par ticipate in a corporate action event","page_number":117,"box":{"x":69,"y":483,"width":821,"height":11}},{"id":"1a95cf1c-c320-423d-a234-e1793ea0ab3d","block_type":"box","text":"may be impacted, or the Fund may experience losses if the proceeds received from liquidating the collateral do not at","page_number":117,"box":{"x":69,"y":498,"width":838,"height":11}},{"id":"12bc3d39-fa50-4fd9-9f63-31a49f361c41","block_type":"box","text":"least equal the value of the loaned security at the time the collateral is liquidated, plus the transaction costs incurred","page_number":117,"box":{"x":70,"y":513,"width":837,"height":11}},{"id":"9462e8a8-3cbe-497b-8e8e-6c95e27ddfec","block_type":"box","text":"in purchasing replacement securities. This latter event could trigger adverse tax consequences for a Fund. A Fund","page_number":117,"box":{"x":70,"y":528,"width":808,"height":12}},{"id":"2424ca04-07da-4ac2-871d-3a789c048466","block_type":"box","text":"could lose money if its shor t-term investment of the collateral declines in value over the period of the loan. Substitute","page_number":117,"box":{"x":69,"y":543,"width":839,"height":12}},{"id":"7dab726b-b69e-4cc8-920d-3e447c926414","block_type":"box","text":"payments received by a Fund representing dividends paid on securities loaned out by the Fund will not be considered","page_number":117,"box":{"x":70,"y":559,"width":832,"height":11}},{"id":"7434f348-10c2-47dd-9395-f86c05d739cf","block_type":"box","text":"qualified dividend income, and distributions by the Fund of such substitute payments will not constitute qualified","page_number":117,"box":{"x":69,"y":574,"width":801,"height":11}},{"id":"b0c8e89b-3eb9-4475-8fa9-b886c6d61b3c","block_type":"box","text":"dividend income. Additionally, substitute payments received by a Fund representing qualified REIT dividends paid on","page_number":117,"box":{"x":69,"y":589,"width":823,"height":11}},{"id":"4f15dc67-cc99-4f85-9a89-8689811ba9b2","block_type":"box","text":"REIT securities loaned out by the Fund will not be considered qualified REIT dividends, and distributions by the Fund","page_number":117,"box":{"x":70,"y":604,"width":823,"height":11}},{"id":"46656d19-d4cc-42b7-b04c-5a81b1f7d1e2","block_type":"box","text":"of such substitute payments will not be eligible for a 20% deduction currently available for ordinary REIT dividends","page_number":117,"box":{"x":69,"y":619,"width":812,"height":11}},{"id":"55611cff-6202-4670-9547-7d16e024d797","block_type":"box","text":"paid to non-corporate shareholders provided cer tain other requirements are satisfied. The securities lending agent","page_number":117,"box":{"x":70,"y":634,"width":814,"height":12}},{"id":"bb30be8b-d852-41bb-85c8-fb365b187466","block_type":"box","text":"will take into account the tax effects on shareholders caused by these differences in connection with a Fund’s","page_number":117,"box":{"x":68,"y":649,"width":787,"height":12}},{"id":"6e7737aa-3d16-45a8-9ee8-9c1944148c5b","block_type":"box","text":"securities lending program. Substitute payments received on tax-exempt securities loaned out will not be tax-exempt","page_number":117,"box":{"x":69,"y":665,"width":828,"height":11}},{"id":"eb2aa8d0-8680-4788-81fc-f08ad3ccb846","block_type":"box","text":"income. There could also be changes in the status of issuers under applicable laws and regulations, including tax","page_number":117,"box":{"x":70,"y":680,"width":809,"height":11}},{"id":"5454ebeb-f799-4697-88e8-b79591c9645f","block_type":"box","text":"regulations, that may impact the regulatory or tax treatment of loaned securities and could, for example, result in a","page_number":117,"box":{"x":69,"y":695,"width":821,"height":11}},{"id":"e37a2103-4208-4957-b56e-744932f7a473","block_type":"box","text":"delay in the payment of dividend equivalent payments owed to a Fund (as permitted by applicable law).","page_number":117,"box":{"x":69,"y":710,"width":731,"height":11}},{"id":"706e48f9-564b-4fd9-9c5a-2d5052f74dd2","block_type":"box","text":"Regulations adopted by global prudential regulators require cer tain bank-regulated counterpar ties and cer tain of","page_number":117,"box":{"x":102,"y":732,"width":800,"height":12}},{"id":"e3589ce4-ecfc-4cdf-8ce4-20b02e267dc3","block_type":"box","text":"their affiliates to include in cer tain financial contracts, including many securities lending agreements, terms that","page_number":117,"box":{"x":68,"y":748,"width":802,"height":11}},{"id":"3d7282ad-8fc3-463f-9289-ffd29b792cc0","block_type":"box","text":"delay or restrict the rights of counterpar ties, such as the Fund, to terminate such agreements, foreclose upon","page_number":117,"box":{"x":69,"y":763,"width":783,"height":11}},{"id":"54c5029d-28de-4238-8535-daaa9bf71c6d","block_type":"box","text":"collateral, exercise other default rights or restrict transfers of credit suppor t in the event that the counterpar ty and/or","page_number":117,"box":{"x":69,"y":778,"width":839,"height":11}},{"id":"981379ba-6153-486e-b85e-36cbd3b15d3e","block_type":"box","text":"its affiliates are subject to cer tain types of resolution or insolvency proceedings. It is possible that these","page_number":117,"box":{"x":70,"y":793,"width":747,"height":11}},{"id":"9983811e-b6c8-4005-a453-b0a3c10a25da","block_type":"box","text":"requirements, as well as potential additional government regulation and other developments in the market, could","page_number":117,"box":{"x":69,"y":808,"width":806,"height":11}},{"id":"4a7fd699-5230-406b-b7ea-a9fe994291bf","block_type":"box","text":"adversely affect the Fund’s ability to terminate existing securities lending agreements or to realize amounts to be","page_number":117,"box":{"x":69,"y":823,"width":808,"height":12}},{"id":"1447136a-9e9b-4039-8148-90d4f5d78ade","block_type":"box","text":"received under such agreements. Prudential regulation may also favor lenders that can provide additional protections,","page_number":117,"box":{"x":69,"y":838,"width":839,"height":12}},{"id":"f19f5294-a396-405a-832b-f1946a417005","block_type":"box","text":"such as liens that are exercisable in connection with a lender default, to borrowers. Cer tain Funds expect to provide","page_number":117,"box":{"x":69,"y":853,"width":827,"height":11}},{"id":"89a22705-f9eb-4d1a-bd18-36e7dfbc93d8","block_type":"box","text":"additional protections to borrowers, where permitted pursuant to a Fund’s investment policies and if BlackRock","page_number":117,"box":{"x":69,"y":869,"width":794,"height":11}},{"id":"d34cb068-988d-48b6-aad4-c50fe47cd827","block_type":"box","text":"believes doing so is in the best interest of the Fund.","page_number":117,"box":{"x":69,"y":884,"width":371,"height":11}},{"id":"838ae3e9-7407-4c3d-9bd3-f4c98fbe8d8d","block_type":"box","text":"II-73","page_number":117,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"48680441-75bc-4ebd-a095-19d5860f80dd","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":117,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"26d6cf02-f72d-47df-801c-844646a5605a","block_type":"box","text":"The SEC has adopted a rule that will require repor ting and public disclosure of securities loan transaction","page_number":118,"box":{"x":101,"y":45,"width":753,"height":11}},{"id":"4a2a5cbe-2b6a-4cf7-a750-2c0cc981cfb4","block_type":"box","text":"information (not including par ty names); this may include, but is not limited to, information about securities loans","page_number":118,"box":{"x":70,"y":60,"width":808,"height":11}},{"id":"23c95b79-921d-4073-8b95-9a7b0300c734","block_type":"box","text":"entered into in connection with shor t sales. Compliance with this rule is expected to be required in late 2028,","page_number":118,"box":{"x":69,"y":75,"width":784,"height":11}},{"id":"70cb386a-e449-4be3-abc5-177a22344ecd","block_type":"box","text":"although in response to the outcome of a legal challenge against the rule, the SEC may amend the rule and/or delay","page_number":118,"box":{"x":69,"y":90,"width":833,"height":11}},{"id":"d433f637-53e4-4aff-8a69-73ff533440a6","block_type":"box","text":"the current expected compliance date.","page_number":118,"box":{"x":68,"y":105,"width":273,"height":11}},{"id":"85f75bf6-68f9-4890-b714-c6501f20b371","block_type":"box","text":"Short Sales.","page_number":118,"box":{"x":101,"y":128,"width":89,"height":9}},{"id":"649fc92a-2a50-4cce-bd9c-01e0b2002503","block_type":"box","text":"Cer tain Funds may make shor t sales of securities, either as a hedge against potential declines in","page_number":118,"box":{"x":196,"y":128,"width":696,"height":11}},{"id":"4ee8d371-c8a0-46ba-a3b8-01161238be15","block_type":"box","text":"value of a por tfolio security or to realize appreciation when a security that the Fund does not own declines in value.","page_number":118,"box":{"x":68,"y":143,"width":821,"height":11}},{"id":"0a0ad697-c101-407f-a190-687981b43ada","block_type":"box","text":"Cer tain Funds have a fundamental investment restriction prohibiting shor t sales of securities unless they are","page_number":118,"box":{"x":69,"y":158,"width":778,"height":11}},{"id":"263e903d-aefd-47d6-ba61-b9be41528734","block_type":"box","text":"“against-the-box.” In a shor t sale “against-the-box,” at the time of the sale, the Fund owns or has the immediate and","page_number":118,"box":{"x":70,"y":173,"width":831,"height":11}},{"id":"70afadc6-5746-400e-bc80-41372deedc11","block_type":"box","text":"unconditional right to acquire the identical security at no additional cost. When a Fund makes a shor t sale, it borrows","page_number":118,"box":{"x":69,"y":188,"width":837,"height":12}},{"id":"8c5d50ea-2042-4ca0-84ca-f9b656c3da42","block_type":"box","text":"the security sold shor t and delivers it to the broker-dealer through which it made the shor t sale. A Fund may have to","page_number":118,"box":{"x":68,"y":204,"width":828,"height":11}},{"id":"ef592484-3a5a-49a6-b904-51eff9b13b75","block_type":"box","text":"pay a fee to borrow par ticular securities and is often obligated to turn over any payments received on such borrowed","page_number":118,"box":{"x":70,"y":218,"width":829,"height":12}},{"id":"cb446347-8382-4842-960e-50c5fb2d23ea","block_type":"box","text":"securities to the lender of the securities.","page_number":118,"box":{"x":69,"y":234,"width":289,"height":9}},{"id":"382bc36c-50d6-4057-af12-47cff441481b","block_type":"box","text":"A Fund secures its obligation to replace the borrowed security by depositing collateral with the broker-dealer,","page_number":118,"box":{"x":101,"y":257,"width":772,"height":11}},{"id":"a3ef7d98-ca30-4030-865e-c399203c6f0b","block_type":"box","text":"usually in cash, U.S. Government Securities or other liquid securities similar to those borrowed. With respect to","page_number":118,"box":{"x":69,"y":272,"width":795,"height":11}},{"id":"fe1ce526-41e8-47ab-88bd-3c163f930969","block_type":"box","text":"uncovered shor t positions, a Fund is required to deposit similar collateral with its custodian, if necessary, to the","page_number":118,"box":{"x":69,"y":286,"width":801,"height":12}},{"id":"f8b48c23-7ea1-41be-908d-29108813f274","block_type":"box","text":"extent that the value of both collateral deposits in the aggregate is at all times equal to at least 100% of the current","page_number":118,"box":{"x":69,"y":302,"width":830,"height":11}},{"id":"3f24ab4e-7638-4146-aaac-99145289b018","block_type":"box","text":"market value of the security sold shor t. Depending on arrangements made with the broker-dealer from which the Fund","page_number":118,"box":{"x":69,"y":317,"width":839,"height":11}},{"id":"bd8df998-d6b8-401d-bc80-d83bafc8371d","block_type":"box","text":"borrowed the security, regarding payment received by the Fund on such security, a Fund may not receive any","page_number":118,"box":{"x":69,"y":332,"width":770,"height":11}},{"id":"61364451-e50b-4d57-ab48-8acb00be29ea","block_type":"box","text":"payments (including interest) on its collateral deposited with such broker-dealer.","page_number":118,"box":{"x":70,"y":347,"width":568,"height":11}},{"id":"ebcaf008-0629-4867-a845-ed2a13b3b902","block_type":"box","text":"Because making shor t sales in securities that it does not own exposes a Fund to the risks associated with those","page_number":118,"box":{"x":102,"y":370,"width":806,"height":11}},{"id":"862dd167-93d9-43fa-92e9-3238b12cba84","block_type":"box","text":"securities, such shor t sales involve speculative exposure risk. A Fund will incur a loss as a result of a shor t sale if","page_number":118,"box":{"x":69,"y":385,"width":817,"height":11}},{"id":"9b4c1808-8faa-45c0-9bcd-da42987ef2c1","block_type":"box","text":"the price of the security increases between the date of the shor t sale and the date on which the Fund replaces the","page_number":118,"box":{"x":68,"y":400,"width":819,"height":11}},{"id":"c84043a6-610d-4ae8-87e9-8eeeb508a4ac","block_type":"box","text":"borrowed security. As a result, if a Fund makes shor t sales in securities that increase in value, it will likely","page_number":118,"box":{"x":69,"y":415,"width":758,"height":11}},{"id":"79be7baf-7e26-4c2c-a023-9d7b19d6dcff","block_type":"box","text":"underper form similar mutual funds that do not make shor t sales in securities. A Fund will realize a gain on a shor t","page_number":118,"box":{"x":69,"y":430,"width":817,"height":11}},{"id":"1dfdd08b-f266-478a-9114-0acc299ffc6c","block_type":"box","text":"sale if the security declines in price between those dates. There can be no assurance that a Fund will be able to","page_number":118,"box":{"x":69,"y":445,"width":800,"height":11}},{"id":"14bfa009-4386-42e8-a15c-bf287f73fe47","block_type":"box","text":"close out a shor t sale position at any par ticular time or at an acceptable price. Although a Fund’s gain is limited to","page_number":118,"box":{"x":69,"y":461,"width":818,"height":11}},{"id":"d526c47d-0f48-4308-a729-0454f5640eb7","block_type":"box","text":"the price at which it sold the security shor t, its potential loss is limited only by the maximum attainable price of the","page_number":118,"box":{"x":68,"y":475,"width":821,"height":12}},{"id":"f0e63ac6-229e-46df-9e41-a5f47da6544a","block_type":"box","text":"security, less the price at which the security was sold and may, theoretically, be unlimited.","page_number":118,"box":{"x":69,"y":491,"width":640,"height":11}},{"id":"f9cc72a2-9c25-4eaf-9561-69d0821042cf","block_type":"box","text":"A Fund may also make shor t sales “against the box” without being subject to such limitations.","page_number":118,"box":{"x":101,"y":514,"width":673,"height":11}},{"id":"f3c62dd1-392f-4d52-9c31-89c364487461","block_type":"box","text":"A Fund must comply with Rule 18f-4 under the Investment Company Act with respect to its shor t sale","page_number":118,"box":{"x":101,"y":536,"width":721,"height":11}},{"id":"ac114e06-ac0b-49f0-a8ad-365fada7a462","block_type":"box","text":"borrowings, which are considered Derivatives Transactions under the Rule. See “—Derivatives — Regulation of","page_number":118,"box":{"x":69,"y":551,"width":791,"height":11}},{"id":"410dc0f5-c292-4a56-a40b-d6d3aea809e1","block_type":"box","text":"Derivatives — Rule 18f-4 under the Investment Company Act” above.","page_number":118,"box":{"x":70,"y":566,"width":489,"height":11}},{"id":"131243cc-8e9e-49bf-aaa2-bc186c440128","block_type":"box","text":"Shor t sales are also subject to cer tain SEC regulations and cer tain European Union and United Kingdom","page_number":118,"box":{"x":102,"y":589,"width":745,"height":11}},{"id":"a6758121-2bbf-43af-a7f0-bbba4040eca7","block_type":"box","text":"regulations (under which there are restrictions on net shor t sales in cer tain securities). If the SEC or regulatory","page_number":118,"box":{"x":69,"y":604,"width":793,"height":11}},{"id":"a5a4369f-dfeb-485e-b493-13b464f57b50","block_type":"box","text":"authorities in other jurisdictions were to adopt additional restrictions regarding shor t sales, they could restrict a","page_number":118,"box":{"x":69,"y":619,"width":796,"height":11}},{"id":"ff6d190c-78f3-426d-88ca-1f0f8e185a00","block_type":"box","text":"Fund’s ability to engage in shor t sales in cer tain circumstances, and the Fund may be unable to execute its","page_number":118,"box":{"x":70,"y":634,"width":766,"height":12}},{"id":"fbb7a7ae-5d27-4675-9743-c6c32447a7b5","block_type":"box","text":"investment strategy as a result. In response to market events, the SEC and regulatory authorities in other","page_number":118,"box":{"x":70,"y":649,"width":754,"height":12}},{"id":"cd55e735-51c6-44e2-9651-4a306d8b2864","block_type":"box","text":"jurisdictions may adopt (and in cer tain cases, have adopted) bans or other restrictions on shor t sales of cer tain","page_number":118,"box":{"x":67,"y":664,"width":800,"height":12}},{"id":"507a4111-4877-445c-9613-95a72a70c89e","block_type":"box","text":"securities or on derivatives and other hedging instruments used to achieve a similar economic effect. Such bans or","page_number":118,"box":{"x":69,"y":680,"width":823,"height":11}},{"id":"6ca41414-d00d-4f47-8977-771540487a97","block_type":"box","text":"other restrictions may make it impossible for a Fund to execute cer tain investment strategies and may have a","page_number":118,"box":{"x":69,"y":695,"width":782,"height":11}},{"id":"2d0f9757-7a48-45db-88f9-e3b7dfd5ce6c","block_type":"box","text":"material adverse effect on the Fund’s ability to generate returns.","page_number":118,"box":{"x":69,"y":710,"width":460,"height":11}},{"id":"730d9a0f-fd74-4a00-9e86-29ec8877662b","block_type":"box","text":"Special Purpose Acquisition Companies.","page_number":118,"box":{"x":101,"y":733,"width":293,"height":11}},{"id":"90e906b1-4b30-4c77-91ed-151fb3f68a5f","block_type":"box","text":"A Fund may invest in stock, warrants, rights and other interests issued","page_number":118,"box":{"x":400,"y":733,"width":504,"height":11}},{"id":"efdf7e35-4e2a-445f-b8f1-ee0464aa708e","block_type":"box","text":"by special purpose acquisition companies (“SPACs”) or similar special purpose entities that pool funds to seek","page_number":118,"box":{"x":69,"y":748,"width":791,"height":11}},{"id":"0ffa1792-d553-42aa-b530-db32162e4098","block_type":"box","text":"potential acquisition oppor tunities, including the “founder’s” shares and warrants described below. A SPAC is a","page_number":118,"box":{"x":70,"y":763,"width":793,"height":11}},{"id":"60d70a46-b7dd-47d6-8c14-cc33f5ef2f91","block_type":"box","text":"publicly traded company that raises investment capital via an IPO for the purpose of identifying and acquiring one or","page_number":118,"box":{"x":70,"y":778,"width":824,"height":11}},{"id":"0a7939d9-7610-4dda-8711-c2c5ebb83323","block_type":"box","text":"more operating businesses or assets. In connection with forming a SPAC, the SPAC’s sponsors acquire “founder’s”","page_number":118,"box":{"x":69,"y":793,"width":821,"height":11}},{"id":"68c39e53-d1c5-47f5-8fe8-88c09221eae3","block_type":"box","text":"shares, generally for nominal consideration, and warrants that will result in the sponsors owning a specified","page_number":118,"box":{"x":69,"y":808,"width":768,"height":11}},{"id":"fb74cbd2-0bec-461c-a926-e4bb8cb70139","block_type":"box","text":"percentage (typically 20%) of the SPAC’s outstanding common stock upon completion of the IPO. At the time a SPAC","page_number":118,"box":{"x":70,"y":823,"width":826,"height":12}},{"id":"4de8d514-4194-4946-bb0a-8dc778c1d8ed","block_type":"box","text":"conducts an IPO, it has selected a management team but has not yet identified a specific acquisition oppor tunity.","page_number":118,"box":{"x":69,"y":838,"width":809,"height":12}},{"id":"b206f77f-20ac-447f-a114-aa71c51eff1e","block_type":"box","text":"Unless and until an acquisition is completed, a SPAC generally invests its assets in U.S. Government securities,","page_number":118,"box":{"x":70,"y":854,"width":797,"height":11}},{"id":"dadccb04-1463-4237-8d90-4f0ad7d83ae8","block_type":"box","text":"money market securities and cash. If an acquisition that meets the requirements for the SPAC is not completed","page_number":118,"box":{"x":69,"y":869,"width":795,"height":11}},{"id":"49ee1212-c32f-484f-a362-e5700ea43788","block_type":"box","text":"within a pre-established period of time, the invested funds are returned to the SPAC’s public shareholders, the","page_number":118,"box":{"x":68,"y":884,"width":788,"height":11}},{"id":"5ee8615c-2012-44b5-bcb0-543ec22ac5b5","block_type":"box","text":"warrants expire, and the “founder’s” shares and such warrants become wor thless. Because SPACs and similar","page_number":118,"box":{"x":68,"y":899,"width":794,"height":11}},{"id":"bd491a2c-34f4-4574-8bb8-e15823ccd86f","block_type":"box","text":"II-74","page_number":118,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"b42bf67e-b5e9-4df8-9ed8-54fa2a556452","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":118,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"23f1481b-5287-4697-a5a7-dc8521016e64","block_type":"box","text":"entities are in essence “blank check” companies without operating histories or ongoing business operations (other","page_number":119,"box":{"x":69,"y":45,"width":820,"height":11}},{"id":"35b26608-f61c-4367-8895-40a958ba3f96","block_type":"box","text":"than identifying and pursuing acquisitions), the potential for the long-term capital appreciation of their securities is","page_number":119,"box":{"x":68,"y":60,"width":815,"height":11}},{"id":"af4658d1-d279-48e1-8889-b7e33cf75343","block_type":"box","text":"par ticularly dependent on the ability of the SPAC’s management to identify and complete a profitable acquisition.","page_number":119,"box":{"x":70,"y":75,"width":802,"height":11}},{"id":"0c2b5e97-5a31-4033-9a0d-b27654a6a542","block_type":"box","text":"There is no guarantee that the SPACs in which a Fund invests will complete an acquisition or that any acquisitions","page_number":119,"box":{"x":68,"y":90,"width":812,"height":11}},{"id":"2abd3a0c-8e38-4ff1-a95e-d7720b3a0b57","block_type":"box","text":"completed by the SPACs in which the Fund invests will be profitable. Some SPACs may pursue acquisitions only within","page_number":119,"box":{"x":69,"y":105,"width":838,"height":11}},{"id":"7013cf81-33f6-43e4-9710-9695c32525aa","block_type":"box","text":"cer tain industries or regions, which may ultimately lead to an increase in the volatility of their prices following the","page_number":119,"box":{"x":69,"y":120,"width":806,"height":12}},{"id":"f4eaf2fb-bfc9-4e89-838f-b6568a428d86","block_type":"box","text":"acquisition. In addition, some of these securities may be considered illiquid and/or subject to restrictions on resale.","page_number":119,"box":{"x":69,"y":135,"width":828,"height":11}},{"id":"e1dc25ad-ad62-4485-9844-7c67dc822292","block_type":"box","text":"Standby Commitment Agreements.","page_number":119,"box":{"x":101,"y":158,"width":255,"height":11}},{"id":"96338ffa-acd0-4bb5-853e-a1816705b0cc","block_type":"box","text":"Standby commitment agreements commit a Fund, for a stated period of","page_number":119,"box":{"x":362,"y":158,"width":511,"height":11}},{"id":"198502fa-1ff2-4e7d-ba89-8e70a2713303","block_type":"box","text":"time, to purchase a stated amount of securities that may be issued and sold to that Fund at the option of the issuer.","page_number":119,"box":{"x":68,"y":173,"width":834,"height":11}},{"id":"238dc431-68fd-4534-86be-d7270691a0fc","block_type":"box","text":"The price of the security is fixed at the time of the commitment. At the time of entering into the agreement, a Fund is","page_number":119,"box":{"x":68,"y":188,"width":834,"height":12}},{"id":"7d0696b2-f754-4230-9202-85d3c959c9b9","block_type":"box","text":"paid a commitment fee, regardless of whether or not the security is ultimately issued. A Fund will enter into such","page_number":119,"box":{"x":70,"y":203,"width":802,"height":12}},{"id":"29d57d16-03fb-4f6c-b512-691ca6bd1f75","block_type":"box","text":"agreements for the purpose of investing in the security underlying the commitment at a price that is considered","page_number":119,"box":{"x":69,"y":218,"width":793,"height":12}},{"id":"0ae6e0b1-986b-42a3-952e-f90c61419b9f","block_type":"box","text":"advantageous to the Fund.","page_number":119,"box":{"x":69,"y":234,"width":188,"height":11}},{"id":"d9751b00-3765-456c-9f89-93ff880d29cb","block_type":"box","text":"There can be no assurance that the securities subject to a standby commitment will be issued, and the value of","page_number":119,"box":{"x":101,"y":256,"width":800,"height":11}},{"id":"b2160f1f-1f14-4fb9-b9a7-71cbfd7a6f23","block_type":"box","text":"the security, if issued, on the delivery date may be more or less than its purchase price. Since the issuance of the","page_number":119,"box":{"x":68,"y":271,"width":816,"height":12}},{"id":"cb31c89a-8c93-4846-963e-3c67161446ad","block_type":"box","text":"security underlying the commitment is at the option of the issuer, the Fund may bear the risk of a decline in the value","page_number":119,"box":{"x":69,"y":286,"width":835,"height":12}},{"id":"37f07a76-5301-4b02-8ba9-01955811a27a","block_type":"box","text":"of such security and may not benefit from an appreciation in the value of the security during the commitment period.","page_number":119,"box":{"x":69,"y":302,"width":828,"height":11}},{"id":"17485026-f851-4748-bd15-4f6f623b4423","block_type":"box","text":"The purchase of a security pursuant to a standby commitment agreement and the related commitment fee will","page_number":119,"box":{"x":101,"y":324,"width":785,"height":12}},{"id":"8050eb44-02c8-4fbf-b8cb-d27e095586d0","block_type":"box","text":"be recorded on the date on which the security can reasonably be expected to be issued, and the value of the security","page_number":119,"box":{"x":69,"y":339,"width":837,"height":12}},{"id":"7bb77749-1c22-42a2-a320-5b79bb621e1e","block_type":"box","text":"thereafter will be reflected in the calculation of a Fund’s NAV. The cost basis of the security will be adjusted by the","page_number":119,"box":{"x":68,"y":355,"width":815,"height":11}},{"id":"bcc752f9-b5d7-4323-aae2-a038c1d85fc0","block_type":"box","text":"amount of the commitment fee. In the event the security is not issued, the commitment fee will be recorded as","page_number":119,"box":{"x":69,"y":370,"width":792,"height":11}},{"id":"15d6e3c6-5500-4998-9c86-8197f0dc903c","block_type":"box","text":"income on the expiration date of the standby commitment.","page_number":119,"box":{"x":70,"y":385,"width":415,"height":11}},{"id":"7d90eba1-f388-4588-a16a-e654cfa1a3e8","block_type":"box","text":"Standby commitments will only be entered into with dealers, banks and broker-dealers which, in the Manager’s","page_number":119,"box":{"x":102,"y":408,"width":789,"height":11}},{"id":"43435414-a73c-4df0-8a2a-b8ecbed718d5","block_type":"box","text":"or sub-adviser’s opinion, present minimal credit risks. A Fund will acquire standby commitments solely to facilitate","page_number":119,"box":{"x":69,"y":423,"width":814,"height":11}},{"id":"8ae260c2-cc17-427c-a9a2-f49258e62efc","block_type":"box","text":"por tfolio liquidity and not to exercise its rights thereunder for trading purposes. Standby commitments will be valued","page_number":119,"box":{"x":70,"y":438,"width":827,"height":11}},{"id":"349ee483-5bee-4d63-a7c7-7c4b2adc00d7","block_type":"box","text":"at zero in determining NAV. Accordingly, where a Fund pays directly or indirectly for a standby commitment, its cost","page_number":119,"box":{"x":69,"y":453,"width":815,"height":11}},{"id":"1da23b68-802e-4220-8050-5a9661e0c8d3","block_type":"box","text":"will be reflected as an unrealized loss for the period during which the commitment is held by such Fund and will be","page_number":119,"box":{"x":68,"y":468,"width":817,"height":11}},{"id":"90df3634-55cc-408c-bc19-8d0ca1b80385","block_type":"box","text":"reflected as a realized gain or loss when the commitment is exercised or expires.","page_number":119,"box":{"x":69,"y":483,"width":578,"height":11}},{"id":"02e12966-b272-43d4-a63a-a92fe487a498","block_type":"box","text":"Stripped Securities.","page_number":119,"box":{"x":101,"y":506,"width":143,"height":11}},{"id":"76de6fb6-6eb4-441a-93ac-cc2060220be2","block_type":"box","text":"Stripped securities are created when the issuer separates the interest and principal","page_number":119,"box":{"x":251,"y":506,"width":596,"height":11}},{"id":"0fe11543-723b-4e0b-996e-2505bdf59fc4","block_type":"box","text":"components of an instrument and sells them as separate securities. In general, one security is entitled to receive the","page_number":119,"box":{"x":69,"y":521,"width":839,"height":11}},{"id":"72ebfd0f-0c8e-470d-b4dd-7c3265016800","block_type":"box","text":"interest payments on the underlying assets (the interest only or “IO” security) and the other to receive the principal","page_number":119,"box":{"x":70,"y":536,"width":818,"height":11}},{"id":"fedb3c2f-7ccd-47f2-aba0-5d8ac547920b","block_type":"box","text":"payments (the principal only or “PO” security). Some stripped securities may receive a combination of interest and","page_number":119,"box":{"x":70,"y":551,"width":813,"height":11}},{"id":"3cbf3a7c-ea20-44c3-81f8-9bec7a4aa1c0","block_type":"box","text":"principal payments. The yields to maturity on IOs and POs are sensitive to the expected or anticipated rate of","page_number":119,"box":{"x":70,"y":566,"width":777,"height":11}},{"id":"2a6b6742-3d70-4523-808c-caba7c409927","block_type":"box","text":"principal payments (including prepayments) on the related underlying assets, and principal payments may have a","page_number":119,"box":{"x":70,"y":582,"width":802,"height":11}},{"id":"422d44d5-b8da-451b-a02f-096d2046fe5b","block_type":"box","text":"material effect on yield to maturity. If the underlying assets experience greater than anticipated prepayments of","page_number":119,"box":{"x":69,"y":596,"width":794,"height":12}},{"id":"8e8233bc-ee59-424c-8760-d2f3fdbaa94d","block_type":"box","text":"principal, a Fund may not fully recoup its initial investment in IOs. Conversely, if the underlying assets experience less","page_number":119,"box":{"x":70,"y":612,"width":837,"height":11}},{"id":"85b9b753-addc-441b-bf09-ed2e62ec9e98","block_type":"box","text":"than anticipated prepayments of principal, the yield on POs could be adversely affected. Stripped securities may be","page_number":119,"box":{"x":68,"y":627,"width":823,"height":11}},{"id":"bfad6416-fc0f-429d-a987-afe0d29fee69","block_type":"box","text":"highly sensitive to changes in interest rates and rates of prepayment.","page_number":119,"box":{"x":69,"y":642,"width":494,"height":11}},{"id":"f3007649-4ba0-445e-9954-5e372e0044fd","block_type":"box","text":"Structured Notes.","page_number":119,"box":{"x":101,"y":665,"width":130,"height":8}},{"id":"5f00b9be-3828-4d15-a7ca-a44e032559bf","block_type":"box","text":"Structured notes and other related instruments purchased by a Fund are generally privately","page_number":119,"box":{"x":237,"y":665,"width":650,"height":11}},{"id":"6c26233d-5bd1-46be-943d-afee81a39b95","block_type":"box","text":"negotiated debt obligations where the principal and/or interest is determined by reference to the per formance of a","page_number":119,"box":{"x":69,"y":680,"width":818,"height":11}},{"id":"7775af0a-7ac2-4572-9982-096213be1d46","block_type":"box","text":"specific asset, benchmark asset, market or interest rate (“reference measure”). Issuers of structured notes generally","page_number":119,"box":{"x":69,"y":695,"width":839,"height":11}},{"id":"01f62a91-2e21-45ac-b73b-11beeb554e95","block_type":"box","text":"include corporations and banks. The interest rate or the principal amount payable upon maturity or redemption may","page_number":119,"box":{"x":70,"y":710,"width":821,"height":11}},{"id":"f61a1703-e080-43ca-b3de-1bb0d8126c2d","block_type":"box","text":"increase or decrease, depending upon changes in the value of the reference measure. The terms of a structured note","page_number":119,"box":{"x":70,"y":725,"width":839,"height":11}},{"id":"376f05a0-d90f-4af6-918b-d33343606251","block_type":"box","text":"may provide that, in cer tain circumstances, no principal is due at maturity and, therefore, may result in a loss of","page_number":119,"box":{"x":69,"y":740,"width":801,"height":11}},{"id":"a6a329fe-4dbc-41a1-9d5d-72335492bc44","block_type":"box","text":"invested capital by a Fund. The interest and/or principal payments that may be made on a structured product may","page_number":119,"box":{"x":70,"y":755,"width":813,"height":11}},{"id":"e10265f8-166a-44a2-8f02-d59b838bf5da","block_type":"box","text":"vary widely, depending on a variety of factors, including the volatility of the reference measure.","page_number":119,"box":{"x":68,"y":770,"width":673,"height":12}},{"id":"c2060684-43f7-4580-b382-d459865647b3","block_type":"box","text":"Structured notes may be positively or negatively indexed, so the appreciation of the reference measure may","page_number":119,"box":{"x":102,"y":793,"width":768,"height":11}},{"id":"ab18121c-f848-425c-b8b6-5b6ed49cd765","block_type":"box","text":"produce an increase or a decrease in the interest rate or the value of the principal at maturity. The rate of return on","page_number":119,"box":{"x":70,"y":808,"width":821,"height":11}},{"id":"24921a03-a712-42ea-b510-169653b37d97","block_type":"box","text":"structured notes may be determined by applying a multiplier to the per formance or differential per formance of","page_number":119,"box":{"x":69,"y":823,"width":787,"height":12}},{"id":"a0284306-a9ea-47b3-926e-b4734c5cbf29","block_type":"box","text":"reference measures. Application of a multiplier involves leverage that will serve to magnify the potential for gain and","page_number":119,"box":{"x":69,"y":838,"width":827,"height":12}},{"id":"7239c8f1-dff9-4e7c-96b7-850a86a4543e","block_type":"box","text":"the risk of loss.","page_number":119,"box":{"x":68,"y":853,"width":110,"height":9}},{"id":"25c2216f-8f0e-4cb3-bc77-53b6f10ddf5f","block_type":"box","text":"The purchase of structured notes exposes a Fund to the credit risk of the issuer of the structured product.","page_number":119,"box":{"x":101,"y":876,"width":759,"height":11}},{"id":"13a4705e-4c79-4fbb-8264-4ad24e9fb547","block_type":"box","text":"Structured notes may also be more volatile, less liquid, and more difficult to price accurately than less complex","page_number":119,"box":{"x":69,"y":891,"width":795,"height":11}},{"id":"4513a4f1-4ef2-4cda-ae49-03e4802c7471","block_type":"box","text":"securities and instruments or more traditional debt securities. The secondary market for structured notes could be","page_number":119,"box":{"x":69,"y":906,"width":819,"height":12}},{"id":"eb9dd9ad-fbf2-4cdd-a8c7-601260a2a8d5","block_type":"box","text":"II-75","page_number":119,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"2dea0244-59e0-4c10-90cc-333b6b9e84ff","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":119,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"ae2f5abe-823b-43f8-ad6c-73b141cc50dd","block_type":"box","text":"illiquid making them difficult to sell when the Fund determines to sell them. The possible lack of a liquid secondary","page_number":120,"box":{"x":70,"y":45,"width":821,"height":11}},{"id":"11f918f0-55b0-46b5-aadf-80247269ad90","block_type":"box","text":"market for structured notes and the resulting inability of the Fund to sell a structured note could expose the Fund to","page_number":120,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"0bf89b58-90e6-4d6c-a2d2-3ea2728c0130","block_type":"box","text":"losses and could make structured notes more difficult for the Fund to value accurately.","page_number":120,"box":{"x":70,"y":75,"width":618,"height":11}},{"id":"829deab1-4b05-4110-9276-40d6d1b03f70","block_type":"box","text":"Taxability Risk.","page_number":120,"box":{"x":103,"y":98,"width":109,"height":11}},{"id":"80d07cfa-faab-43ea-aa03-e4d19294f9da","block_type":"box","text":"Cer tain of the Funds intend to minimize the payment of taxable income to shareholders by","page_number":120,"box":{"x":218,"y":98,"width":644,"height":11}},{"id":"7eb474c4-2a3c-4c35-b723-8934e7cb6ea9","block_type":"box","text":"investing in tax-exempt or municipal securities in reliance at the time of purchase on an opinion of bond counsel to","page_number":120,"box":{"x":70,"y":113,"width":817,"height":11}},{"id":"da4c901b-e8ea-4301-95a5-33f9ee59812c","block_type":"box","text":"the issuer and, in the case of derivative securities, sponsors’ counsel, that the interest paid on those securities will","page_number":120,"box":{"x":68,"y":128,"width":827,"height":11}},{"id":"6377b2a7-609f-4ea8-b2c0-07e53e89e30d","block_type":"box","text":"be excludable from gross income for U.S. federal income tax purposes. Such securities, however, may be determined","page_number":120,"box":{"x":69,"y":143,"width":835,"height":11}},{"id":"f25aa58e-0215-4ecc-82ef-ec93a20517e5","block_type":"box","text":"to pay, or have paid, taxable income subsequent to the Fund’s acquisition of the securities. In that event, the IRS","page_number":120,"box":{"x":68,"y":158,"width":809,"height":11}},{"id":"efe62d02-ff73-40b8-91ee-ed15bcb91e33","block_type":"box","text":"may demand that the Fund pay U.S. federal income taxes on the affected interest income, and, if the Fund agrees to","page_number":120,"box":{"x":69,"y":173,"width":832,"height":11}},{"id":"ade7fc7b-37e2-4521-ba94-e5a7b10acec8","block_type":"box","text":"do so, the Fund’s yield could be adversely affected. In addition, the treatment of dividends previously paid or to be","page_number":120,"box":{"x":69,"y":188,"width":816,"height":11}},{"id":"f10524b4-c5f9-466c-8890-73c5d88bb49c","block_type":"box","text":"paid by the Fund as “exempt interest dividends” could be adversely affected, subjecting the Fund’s shareholders to","page_number":120,"box":{"x":70,"y":203,"width":822,"height":12}},{"id":"3e684889-c62c-4239-999a-b11c2542937b","block_type":"box","text":"increased U.S. federal income tax liabilities. If the interest paid on any tax-exempt or municipal security held by the","page_number":120,"box":{"x":70,"y":218,"width":818,"height":12}},{"id":"7de28c43-8464-4dd0-bd64-b8c9d6d26c18","block_type":"box","text":"Fund is subsequently determined to be taxable, the Fund will dispose of that security as soon as reasonably","page_number":120,"box":{"x":70,"y":234,"width":771,"height":11}},{"id":"cf7a90f9-7f36-4673-ba2a-3e93a69b38b9","block_type":"box","text":"practicable. In addition, future laws, regulations, rulings or cour t decisions may cause interest on municipal","page_number":120,"box":{"x":70,"y":249,"width":765,"height":11}},{"id":"750d311e-42e0-41d5-80e9-08d6df03a376","block_type":"box","text":"securities to be subject, directly or indirectly, to U.S. federal income taxation or interest on state municipal securities","page_number":120,"box":{"x":69,"y":264,"width":834,"height":11}},{"id":"5bfc660d-f300-4139-860d-4954d4d1f1b7","block_type":"box","text":"to be subject to state or local income taxation, or the value of state municipal securities to be subject to state or","page_number":120,"box":{"x":68,"y":279,"width":807,"height":11}},{"id":"e6dd9cac-563e-4909-a456-f5919ff85d2f","block_type":"box","text":"local intangible personal proper ty tax, or may otherwise prevent the Fund from realizing the full current benefit of the","page_number":120,"box":{"x":70,"y":294,"width":830,"height":11}},{"id":"76fda18f-ffed-48ea-9397-60d98db3ef11","block_type":"box","text":"tax-exempt status of such securities. Any such change could also affect the market price of such securities, and thus","page_number":120,"box":{"x":68,"y":309,"width":838,"height":11}},{"id":"091dae03-06e5-42a3-b4fc-004ee7c5e951","block_type":"box","text":"the value of an investment in the Fund.","page_number":120,"box":{"x":68,"y":324,"width":278,"height":9}},{"id":"1b35cae8-f16a-40d7-a907-2eaa24e74530","block_type":"box","text":"Temporary Defensive Measures.","page_number":120,"box":{"x":103,"y":347,"width":230,"height":11}},{"id":"226231ab-cb34-40da-8b64-c07054c822e2","block_type":"box","text":"As a temporary defensive measure, including to respond to adverse market,","page_number":120,"box":{"x":339,"y":347,"width":542,"height":11}},{"id":"ff63b954-d681-42a7-8dd4-06a09a586d96","block_type":"box","text":"economic, political or other conditions, a Fund may depar t from its principal investment strategies and may invest","page_number":120,"box":{"x":69,"y":362,"width":811,"height":11}},{"id":"22a8b3d2-2b88-48e0-987d-fd756cf9eb71","block_type":"box","text":"without limitation in cash, high quality money market instruments, or other shor t term investments. Cer tain Funds","page_number":120,"box":{"x":68,"y":377,"width":813,"height":12}},{"id":"6a0a1e2e-f094-4669-a001-b91bbea1a1d1","block_type":"box","text":"may also invest in cash and other such instruments pending investment or to meet anticipated redemption requests.","page_number":120,"box":{"x":69,"y":393,"width":833,"height":11}},{"id":"8c5bd06c-520c-420a-84d5-b27cfc5fa08f","block_type":"box","text":"High quality money market instruments include U.S. Government obligations, U.S. Government agency obligations,","page_number":120,"box":{"x":70,"y":408,"width":813,"height":11}},{"id":"67f87042-6e33-4934-a88b-14121d12861a","block_type":"box","text":"dollar denominated obligations of foreign issuers, bank obligations, including U.S. subsidiaries and branches of","page_number":120,"box":{"x":69,"y":423,"width":795,"height":11}},{"id":"9031c079-5016-45a8-8e87-3b1b1f598998","block_type":"box","text":"foreign banks, corporate obligations, commercial paper, repurchase agreements and obligations of supranational","page_number":120,"box":{"x":68,"y":438,"width":806,"height":11}},{"id":"112bf289-2314-42fd-8a17-251b350b461d","block_type":"box","text":"organizations. Generally, such obligations will mature within one year from the date of settlement but may mature","page_number":120,"box":{"x":69,"y":453,"width":808,"height":11}},{"id":"1976d516-a815-4a65-9311-b0acf1c87927","block_type":"box","text":"within two years from the date of settlement. Temporary defensive measures may affect a Fund’s ability to achieve","page_number":120,"box":{"x":68,"y":468,"width":820,"height":11}},{"id":"de189b7f-7bdb-49f4-856f-4b042b35522e","block_type":"box","text":"its investment objective.","page_number":120,"box":{"x":70,"y":483,"width":171,"height":11}},{"id":"9447e4a1-0b5f-4660-aafa-390fc2ebf4ca","block_type":"box","text":"U.S. Government Obligations.","page_number":120,"box":{"x":102,"y":506,"width":213,"height":11}},{"id":"ded2a2b9-ff8d-4fdf-b9c9-cad4084c9206","block_type":"box","text":"A Fund may purchase obligations issued or guaranteed by the U.S. Government","page_number":120,"box":{"x":321,"y":506,"width":566,"height":11}},{"id":"b1c37c80-b8ac-47f3-9fd4-39d1c916655e","block_type":"box","text":"and U.S. Government agencies and instrumentalities. Obligations of cer tain agencies and instrumentalities of the","page_number":120,"box":{"x":69,"y":521,"width":810,"height":11}},{"id":"4cf8851c-126d-4381-b47d-821dee00fb1a","block_type":"box","text":"U.S. Government are suppor ted by the full faith and credit of the U.S. Treasury. Others are suppor ted by the right of","page_number":120,"box":{"x":70,"y":536,"width":826,"height":11}},{"id":"75fd4a2c-06c5-4e18-bf4d-030ce2a2e2b1","block_type":"box","text":"the issuer to borrow from the U.S. Treasury; and still others are suppor ted only by the credit of the agency or","page_number":120,"box":{"x":68,"y":551,"width":779,"height":11}},{"id":"065ae55c-15bb-4e14-b52a-97d2f294b641","block_type":"box","text":"instrumentality issuing the obligation. No assurance can be given that the U.S. Government will provide financial","page_number":120,"box":{"x":70,"y":566,"width":798,"height":11}},{"id":"4a2401b4-c71c-44d6-83f8-741d90634984","block_type":"box","text":"suppor t to U.S. Government-sponsored instrumentalities if it is not obligated to do so by law. Cer tain U.S. Treasury","page_number":120,"box":{"x":69,"y":581,"width":822,"height":12}},{"id":"36cf9424-44af-4890-aa63-cd8cd75c58ce","block_type":"box","text":"and agency securities may be held by trusts that issue par ticipation cer tificates (such as Treasury income growth","page_number":120,"box":{"x":69,"y":596,"width":809,"height":12}},{"id":"dac181ad-af9f-4147-a32d-8a39fde3d319","block_type":"box","text":"receipts and cer tificates of accrual on Treasury cer tificates). These cer tificates, as well as Treasury receipts and","page_number":120,"box":{"x":69,"y":612,"width":805,"height":11}},{"id":"63d4bc31-7785-4d83-84c2-16a39640cf5d","block_type":"box","text":"other stripped securities, represent beneficial ownership interests in either future interest payments or the future","page_number":120,"box":{"x":69,"y":627,"width":807,"height":11}},{"id":"2da34e93-caf1-4689-b316-de7ef8be614f","block_type":"box","text":"principal payments on U.S. Government obligations. These instruments are issued at a discount to their “face value”","page_number":120,"box":{"x":70,"y":642,"width":832,"height":11}},{"id":"7562d32a-3bdc-4fb3-ad65-166dad22eb73","block_type":"box","text":"and may (par ticularly in the case of stripped mor tgage-backed securities) exhibit greater price volatility than ordinary","page_number":120,"box":{"x":69,"y":657,"width":829,"height":11}},{"id":"7c086340-dfa3-47a5-a6da-c7165571a17a","block_type":"box","text":"debt securities because of the manner in which their principal and interest are returned to investors.","page_number":120,"box":{"x":69,"y":672,"width":716,"height":11}},{"id":"4afd5e88-1c4e-4197-a859-a16b38ae277b","block_type":"box","text":"Examples of the types of U.S. Government obligations that may be held by the Funds include U.S. Treasury Bills,","page_number":120,"box":{"x":102,"y":695,"width":800,"height":11}},{"id":"c7bd2160-b092-43e3-b08a-622e013e2009","block_type":"box","text":"Treasury Notes and Treasury Bonds and the obligations of the Federal Housing Administration, Farmers Home","page_number":120,"box":{"x":68,"y":710,"width":785,"height":11}},{"id":"c330cef5-5c91-4efb-a40b-eada882237c9","block_type":"box","text":"Administration, Expor t-Impor t Bank of the United States, Small Business Administration, Ginnie Mae, Fannie Mae,","page_number":120,"box":{"x":68,"y":725,"width":813,"height":11}},{"id":"e4307002-5189-4282-a65d-3918429c2b38","block_type":"box","text":"Federal Financing Bank, General Services Administration, Student Loan Marketing Association, Central Bank for","page_number":120,"box":{"x":70,"y":740,"width":794,"height":11}},{"id":"4109a694-621c-4f77-a0e6-25e0ce3d94d8","block_type":"box","text":"Cooperatives, Federal Home Loan Banks, Freddie Mac, Federal Intermediate Credit Banks, Federal Land Banks, Farm","page_number":120,"box":{"x":69,"y":755,"width":835,"height":11}},{"id":"6080879c-4cdb-4cc2-9cbc-7bed3981d444","block_type":"box","text":"Credit Banks System, Maritime Administration, Tennessee Valley Authority and Washington D.C. Armory Board. The","page_number":120,"box":{"x":69,"y":770,"width":818,"height":12}},{"id":"495da81c-c96c-4429-a3ac-577832e7b6c4","block_type":"box","text":"Funds may also invest in mor tgage-related securities issued or guaranteed by U.S. Government agencies and","page_number":120,"box":{"x":70,"y":786,"width":777,"height":11}},{"id":"71892b5d-1f31-473d-91db-81bf1d7de923","block_type":"box","text":"instrumentalities, including such instruments as obligations of Ginnie Mae, Fannie Mae and Freddie Mac.","page_number":120,"box":{"x":70,"y":801,"width":749,"height":11}},{"id":"360d29dc-92b4-45e8-adbc-151171959930","block_type":"box","text":"U.S. Treasury Obligations.","page_number":120,"box":{"x":103,"y":823,"width":183,"height":12}},{"id":"c9bc4f52-87b8-4038-8194-e75f7e154561","block_type":"box","text":"Treasury obligations may differ in their interest rates, maturities, times of issuance","page_number":120,"box":{"x":292,"y":823,"width":593,"height":12}},{"id":"6b8ec577-f7d6-41b2-87e4-f96b5e5164e8","block_type":"box","text":"and other characteristics. Obligations of U.S. Government agencies and authorities are suppor ted by varying degrees","page_number":120,"box":{"x":69,"y":838,"width":835,"height":12}},{"id":"b4e2f584-0415-4f07-8f93-febaf38d96ad","block_type":"box","text":"of credit but generally are not backed by the full faith and credit of the U.S. Government. No assurance can be given","page_number":120,"box":{"x":69,"y":853,"width":827,"height":12}},{"id":"9eab4438-4fe5-4fad-86a4-d36e4d94ecf1","block_type":"box","text":"that the U.S. Government will provide financial suppor t to its agencies and authorities if it is not obligated by law to","page_number":120,"box":{"x":68,"y":869,"width":823,"height":11}},{"id":"42884003-a7b0-4981-a680-62fa71e1425a","block_type":"box","text":"do so.","page_number":120,"box":{"x":69,"y":884,"width":42,"height":9}},{"id":"ed8e210b-8710-4237-b201-cffdae920e34","block_type":"box","text":"II-76","page_number":120,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"0615c195-432b-4059-82f4-3fe9b4f1ddb8","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":120,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"673cfb91-71b3-42c8-add4-f4786119b921","block_type":"box","text":"U.S. Treasury Rolls","page_number":121,"box":{"x":102,"y":45,"width":139,"height":11}},{"id":"029229fd-0dbb-4c94-b069-eb156cb55a07","block_type":"box","text":".","page_number":121,"box":{"x":241,"y":52,"width":3,"height":2}},{"id":"8070e7db-bbac-47e5-9c34-144068d330e1","block_type":"box","text":"Cer tain Funds may invest in U.S. Treasury rolls. In a U.S. Treasury roll transaction, the Fund","page_number":121,"box":{"x":250,"y":45,"width":656,"height":11}},{"id":"2fa7a8d2-897c-4d1d-8bea-30cbfe769c1b","block_type":"box","text":"sells a treasury security to a counterpar ty with a simultaneous agreement to repurchase the same security at an","page_number":121,"box":{"x":69,"y":60,"width":804,"height":11}},{"id":"c9fd1aee-e20e-4185-8276-edf8283830a9","block_type":"box","text":"agreed upon price and future settlement date. U.S. Treasury roll transactions may incrementally adjust the average","page_number":121,"box":{"x":69,"y":75,"width":820,"height":11}},{"id":"25bb1d9f-601e-498f-91ff-32cc10bd4fec","block_type":"box","text":"maturity of a Fund’s por tfolio and increase the interest yield on the Fund’s por tfolio by extending the average maturity","page_number":121,"box":{"x":69,"y":90,"width":840,"height":11}},{"id":"eefc63e4-d67f-44df-b860-1bdb8ee8a622","block_type":"box","text":"of the por tfolio in a normal yield curve environment. During the period before the settlement date of a U.S. Treasury","page_number":121,"box":{"x":69,"y":105,"width":828,"height":11}},{"id":"4a3154e1-0054-4041-a2ee-91eace08af89","block_type":"box","text":"roll, a Fund continues to earn interest on the securities it is selling; however, it does not earn interest on the","page_number":121,"box":{"x":69,"y":120,"width":775,"height":12}},{"id":"bebe422e-ee36-4f21-b842-aac1547e76bc","block_type":"box","text":"securities it is purchasing until after the settlement date. A Fund could suffer an oppor tunity loss if the counterpar ty","page_number":121,"box":{"x":69,"y":135,"width":829,"height":12}},{"id":"1835e702-3742-4ca2-8ef8-bc923bdbed87","block_type":"box","text":"to the U.S. Treasury roll transaction failed to per form its obligations on the settlement date.","page_number":121,"box":{"x":68,"y":150,"width":657,"height":12}},{"id":"f5d5099a-ccf1-4a7c-8607-de3d5519d599","block_type":"box","text":"The market value of the securities that a Fund is required to purchase may decline below the agreed upon","page_number":121,"box":{"x":101,"y":173,"width":756,"height":11}},{"id":"1f088077-772f-41db-ad2f-e5fb4345f86e","block_type":"box","text":"purchase price of those securities. U.S. Treasury rolls are speculative techniques that can be deemed to involve","page_number":121,"box":{"x":70,"y":188,"width":800,"height":11}},{"id":"8fac91fc-ee4a-4977-b5cb-7a42ef5e44ec","block_type":"box","text":"leverage. There is no assurance that U.S. Treasury rolls can be successfully employed.","page_number":121,"box":{"x":70,"y":203,"width":617,"height":12}},{"id":"b0edeab7-395b-49c3-8ae0-627816f673bc","block_type":"box","text":"Utility Industries.","page_number":121,"box":{"x":102,"y":226,"width":124,"height":11}},{"id":"b97d4257-efa7-414b-9c9d-a5e1c3d52dd9","block_type":"box","text":"Risks that are intrinsic to the utility industries include difficulty in obtaining an adequate return","page_number":121,"box":{"x":233,"y":226,"width":674,"height":11}},{"id":"136c8fb1-9509-4fec-b61e-0ed51e4b4cb2","block_type":"box","text":"on invested capital, difficulty in financing large construction programs during an inflationary period, restrictions on","page_number":121,"box":{"x":69,"y":241,"width":812,"height":11}},{"id":"bba4488f-2d09-47da-9ec7-e74b28d49216","block_type":"box","text":"operations and increased cost and delays attributable to environmental considerations and regulation, difficulty in","page_number":121,"box":{"x":69,"y":256,"width":812,"height":12}},{"id":"85c28876-b588-4932-a6d3-b14504367869","block_type":"box","text":"raising capital in adequate amounts on reasonable terms in periods of high inflation and unsettled capital markets,","page_number":121,"box":{"x":69,"y":271,"width":821,"height":12}},{"id":"027cc61f-30b9-45b7-bd3f-470bd776acd0","block_type":"box","text":"technological innovations that may render existing plants, equipment or products obsolete, the potential impact of","page_number":121,"box":{"x":68,"y":286,"width":815,"height":12}},{"id":"e1086df1-605e-4611-8ee3-dc832fc24806","block_type":"box","text":"natural or man-made disasters, increased costs and reduced availability of cer tain types of fuel, occasional reduced","page_number":121,"box":{"x":69,"y":302,"width":827,"height":11}},{"id":"90abb53c-9a6e-4309-8dc2-e2a7971bde34","block_type":"box","text":"availability and high costs of natural gas for resale, the effects of energy conservation, the effects of a national","page_number":121,"box":{"x":69,"y":317,"width":795,"height":11}},{"id":"bb318ec6-e164-4d49-b1ae-e48e64baa99f","block_type":"box","text":"energy policy and lengthy delays and greatly increased costs and other problems associated with the design,","page_number":121,"box":{"x":69,"y":332,"width":774,"height":11}},{"id":"19b14814-caf9-4324-a14a-6453f84699dc","block_type":"box","text":"construction, licensing, regulation and operation of nuclear facilities for electric generation, including, among other","page_number":121,"box":{"x":69,"y":347,"width":817,"height":11}},{"id":"8e270011-72d3-4cf1-b334-f85d3a8c7540","block_type":"box","text":"considerations, the problems associated with the use of radioactive materials and the disposal of radioactive wastes.","page_number":121,"box":{"x":69,"y":362,"width":839,"height":11}},{"id":"9d53cd59-a304-41e6-906f-fd0486fac402","block_type":"box","text":"There are substantial differences among the regulatory practices and policies of various jurisdictions, and any given","page_number":121,"box":{"x":68,"y":377,"width":827,"height":12}},{"id":"fe11583c-ae36-441c-829b-a2c6ec1d8326","block_type":"box","text":"regulatory agency may make major shifts in policy from time to time. There is no assurance that regulatory","page_number":121,"box":{"x":69,"y":392,"width":761,"height":12}},{"id":"c56725f4-c17e-4756-a3be-f5cf59cfd667","block_type":"box","text":"authorities will, in the future, grant rate increases or that such increases will be adequate to permit the payment of","page_number":121,"box":{"x":69,"y":407,"width":821,"height":12}},{"id":"4cd688a3-5abc-4d0f-b7e1-1737cc827b33","block_type":"box","text":"dividends on common stocks issued by a utility company. Additionally, existing and possible future regulatory","page_number":121,"box":{"x":69,"y":423,"width":777,"height":11}},{"id":"949a290a-aaca-4d66-91d0-0aabaaa88cc9","block_type":"box","text":"legislation may make it even more difficult for utilities to obtain adequate relief. Cer tain of the issuers of securities","page_number":121,"box":{"x":70,"y":438,"width":820,"height":11}},{"id":"ee9976a1-7cfd-4b0d-8cfa-dcc293777208","block_type":"box","text":"held in the Fund’s por tfolio may own or operate nuclear generating facilities. Governmental authorities may from time","page_number":121,"box":{"x":69,"y":453,"width":835,"height":11}},{"id":"17ea34a4-067c-44f8-a6b7-a6075836d017","block_type":"box","text":"to time review existing policies and impose additional requirements governing the licensing, construction and","page_number":121,"box":{"x":68,"y":468,"width":778,"height":11}},{"id":"af7ec84c-b332-4358-8e4e-352bf7d53555","block_type":"box","text":"operation of nuclear power plants. Prolonged changes in climatic conditions can also have a significant impact on","page_number":121,"box":{"x":69,"y":483,"width":808,"height":11}},{"id":"b9a7476d-3766-4ada-9ca2-62d5ad6fe997","block_type":"box","text":"both the revenues of an electric and gas utility as well as the expenses of a utility, par ticularly a hydro-based electric","page_number":121,"box":{"x":69,"y":498,"width":831,"height":11}},{"id":"16156959-ac60-498b-ac20-aa7bde6e6bdb","block_type":"box","text":"utility.","page_number":121,"box":{"x":69,"y":514,"width":39,"height":10}},{"id":"b9f05761-355a-48c9-9eec-ea19e5126ec8","block_type":"box","text":"Companies in the utilities sector may be adversely affected by changes in exchange rates, domestic and","page_number":121,"box":{"x":102,"y":536,"width":744,"height":11}},{"id":"9cc36c60-736c-450f-8e05-f6416ccafb8c","block_type":"box","text":"international competition, and governmental limitations on rates charged to customers. The value of regulated utility","page_number":121,"box":{"x":70,"y":551,"width":828,"height":11}},{"id":"6fd76b8a-1a79-4455-b0ba-384fddfc7826","block_type":"box","text":"debt securities and, to a lesser extent, equity securities, tends to have an inverse relationship to the movement of","page_number":121,"box":{"x":69,"y":566,"width":817,"height":11}},{"id":"100f0860-a507-4d49-844b-e59bc50e543f","block_type":"box","text":"interest rates and therefore may lead to volatility in per formance.","page_number":121,"box":{"x":70,"y":581,"width":464,"height":11}},{"id":"6b80f56c-cea9-4e47-906c-c0065451c0fd","block_type":"box","text":"Utility companies in the United States and in foreign countries are generally subject to regulation. In the United","page_number":121,"box":{"x":102,"y":604,"width":789,"height":11}},{"id":"86706120-27eb-450d-b4f0-bba65043f299","block_type":"box","text":"States, most utility companies are regulated by state and/or federal authorities. Such regulation is intended to","page_number":121,"box":{"x":69,"y":619,"width":790,"height":11}},{"id":"342ae969-d75f-46e0-b225-5701fc78a1c2","block_type":"box","text":"ensure appropriate standards of service and adequate capacity to meet public demand. Generally, prices are also","page_number":121,"box":{"x":69,"y":634,"width":811,"height":11}},{"id":"aa66c425-1982-4111-be94-3c3f1ec092f6","block_type":"box","text":"regulated in the United States and in foreign countries with the intention of protecting the public while ensuring that","page_number":121,"box":{"x":69,"y":649,"width":824,"height":12}},{"id":"d7531ac2-2695-4bac-83a4-f1ab709d7652","block_type":"box","text":"the rate of return earned by utility companies is sufficient to allow them to attract capital in order to grow and","page_number":121,"box":{"x":68,"y":664,"width":781,"height":12}},{"id":"9491e465-0b85-4929-b872-54d924461e29","block_type":"box","text":"continue to provide appropriate services. There can be no assurance that such pricing policies or rates of return will","page_number":121,"box":{"x":69,"y":680,"width":826,"height":11}},{"id":"1af61d97-db29-417f-84b4-714f08896a3f","block_type":"box","text":"continue in the future.","page_number":121,"box":{"x":69,"y":695,"width":156,"height":9}},{"id":"58b5ad57-e8da-40fd-bb77-c2d7f3a691c2","block_type":"box","text":"The nature of regulation of the utility industries continues to evolve both in the United States and in foreign","page_number":121,"box":{"x":101,"y":717,"width":763,"height":12}},{"id":"2259e352-4f36-4b97-b926-f131a25dab79","block_type":"box","text":"countries. In recent years, changes in regulation in the United States increasingly have allowed utility companies to","page_number":121,"box":{"x":69,"y":733,"width":820,"height":11}},{"id":"34a672a2-a593-4e61-94a3-78476aeecc1c","block_type":"box","text":"provide services and products outside their traditional geographic areas and lines of business, creating new areas of","page_number":121,"box":{"x":70,"y":748,"width":834,"height":11}},{"id":"213e536f-6563-43c5-9578-6d062fceb02c","block_type":"box","text":"competition within the industries. In some instances, utility companies are operating on an unregulated basis.","page_number":121,"box":{"x":69,"y":763,"width":784,"height":11}},{"id":"284843a7-b9b5-4b68-b5c6-38863a8622d2","block_type":"box","text":"Because of trends toward deregulation and the evolution of independent power producers as well as new entrants to","page_number":121,"box":{"x":70,"y":778,"width":830,"height":11}},{"id":"4ea1001f-365e-4945-acb9-77c8bab2be69","block_type":"box","text":"the field of telecommunications, non-regulated providers of utility services have become a significant par t of their","page_number":121,"box":{"x":68,"y":793,"width":809,"height":11}},{"id":"fe7ddaa0-893b-48c2-a11c-4df8c79fe0ba","block_type":"box","text":"respective industries. The Manager believes that the emergence of competition and deregulation will result in cer tain","page_number":121,"box":{"x":69,"y":808,"width":834,"height":11}},{"id":"c268bfd6-62be-41c2-ab8e-342663fdc074","block_type":"box","text":"utility companies being able to earn more than their traditional regulated rates of return, while others may be forced","page_number":121,"box":{"x":69,"y":823,"width":825,"height":12}},{"id":"c00e195a-7e71-4e47-acfd-7edce7e294fd","block_type":"box","text":"to defend their core business from increased competition and may be less profitable. Reduced profitability, as well as","page_number":121,"box":{"x":68,"y":838,"width":840,"height":11}},{"id":"a4a592cd-2455-4b03-a5ae-8d681d40b186","block_type":"box","text":"new uses of funds (such as for expansion, operations or stock buybacks) could result in cuts in dividend payout","page_number":121,"box":{"x":69,"y":853,"width":796,"height":12}},{"id":"a4045c6f-1483-4038-9d17-a957fe1d8df1","block_type":"box","text":"rates. As deregulation allows utility companies to diversify outside of their original geographic regions and their","page_number":121,"box":{"x":69,"y":869,"width":790,"height":11}},{"id":"23e427fd-b2cd-4908-86e7-ae36ac9a095a","block_type":"box","text":"traditional lines of business, utility companies may engage in riskier ventures. Therefore, deregulation may eliminate","page_number":121,"box":{"x":68,"y":884,"width":831,"height":11}},{"id":"7aae2564-0038-43b7-ac40-5578954f3373","block_type":"box","text":"restrictions on the maximum level of profits of cer tain utility companies, but may also subject these companies to","page_number":121,"box":{"x":69,"y":899,"width":812,"height":11}},{"id":"6a7567d6-8404-4f30-9633-253bc58030ba","block_type":"box","text":"II-77","page_number":121,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"e2c65b40-2296-4003-9853-1e99a51239a2","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":121,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"8234e74b-3250-4c1e-8528-d71bacc604c8","block_type":"box","text":"greater risk of loss. The Manager seeks to take advantage of favorable investment oppor tunities that may arise from","page_number":122,"box":{"x":68,"y":45,"width":833,"height":11}},{"id":"8a32cf6d-0f2a-4b54-97ab-d1ac57e226ed","block_type":"box","text":"these structural changes. Of course, there can be no assurance that favorable developments will occur in the future.","page_number":122,"box":{"x":68,"y":60,"width":831,"height":11}},{"id":"d6cd3aa0-4714-4cd4-a648-a71df822b948","block_type":"box","text":"Foreign utility companies are also subject to regulation, although such regulations may or may not be","page_number":122,"box":{"x":102,"y":83,"width":720,"height":11}},{"id":"b55fb805-e2c4-401f-b238-7692f5f32f42","block_type":"box","text":"comparable to those in the United States. Foreign utility companies may be more heavily regulated by their respective","page_number":122,"box":{"x":69,"y":98,"width":838,"height":11}},{"id":"c6baf304-4f82-40d8-82ad-7e8b7424e4d7","block_type":"box","text":"governments than utilities in the United States and, as in the United States, generally are required to seek","page_number":122,"box":{"x":68,"y":113,"width":762,"height":11}},{"id":"839b5c61-6234-4b4c-87f5-086a636e09dd","block_type":"box","text":"government approval for rate increases. In addition, many foreign utilities use fuels that may cause more pollution","page_number":122,"box":{"x":68,"y":128,"width":815,"height":11}},{"id":"80c544e8-4f35-4dfd-97c2-d9179c636d7b","block_type":"box","text":"than those used in the United States, which may require such utilities to invest in pollution control equipment to","page_number":122,"box":{"x":68,"y":143,"width":801,"height":11}},{"id":"cc4d429d-b173-4cf5-93ee-0194e93265c9","block_type":"box","text":"meet any proposed pollution restrictions. Foreign regulatory systems vary from country to country and may evolve in","page_number":122,"box":{"x":69,"y":158,"width":828,"height":11}},{"id":"8d1bb3c6-fdec-4e5c-9e2d-5a80706a63ac","block_type":"box","text":"ways different from regulation in the United States.","page_number":122,"box":{"x":68,"y":173,"width":365,"height":11}},{"id":"1c68ad24-3cf1-462f-86b1-2fa362cdcb01","block_type":"box","text":"A Fund’s investment policies are designed to enable it to capitalize on evolving investment oppor tunities","page_number":122,"box":{"x":101,"y":196,"width":745,"height":11}},{"id":"2a08ab5c-7292-4571-8327-99e073ce51d4","block_type":"box","text":"throughout the world. For example, the rapid growth of cer tain foreign economies will necessitate expansion of","page_number":122,"box":{"x":68,"y":211,"width":790,"height":11}},{"id":"a782d388-570c-4598-8d1a-9e105d26eef8","block_type":"box","text":"capacity in the utility industries in those countries. Although many foreign utility companies currently are government","page_number":122,"box":{"x":69,"y":226,"width":833,"height":11}},{"id":"e51a7374-ea21-4aca-b441-7d9708240e12","block_type":"box","text":"owned, thereby limiting current investment oppor tunities for a Fund, the Manager believes that, in order to attract","page_number":122,"box":{"x":69,"y":241,"width":810,"height":11}},{"id":"21b26130-76c3-4830-8b08-cd4fa17644a6","block_type":"box","text":"significant capital for growth, foreign governments are likely to seek global investors through the privatization of their","page_number":122,"box":{"x":69,"y":256,"width":831,"height":12}},{"id":"99499a00-8559-4e86-b9af-224dd361a84c","block_type":"box","text":"utility industries. Privatization, which refers to the trend toward investor ownership of assets rather than government","page_number":122,"box":{"x":69,"y":271,"width":828,"height":12}},{"id":"9061848f-9669-474c-9eae-8d1a1f64227c","block_type":"box","text":"ownership, is expected to occur in newer, faster-growing economies and in mature economies. Of course, there is no","page_number":122,"box":{"x":69,"y":286,"width":832,"height":12}},{"id":"e79aa545-1cab-4f52-9686-d0f86ecdbdfc","block_type":"box","text":"assurance that such favorable developments will occur or that investment oppor tunities in foreign markets will","page_number":122,"box":{"x":69,"y":302,"width":786,"height":11}},{"id":"8b30428d-3000-4bb4-aec0-0ffb2c92a999","block_type":"box","text":"increase.","page_number":122,"box":{"x":70,"y":317,"width":63,"height":9}},{"id":"d197f714-0e03-4f2b-b414-5070f47de5ad","block_type":"box","text":"The revenues of domestic and foreign utility companies generally reflect the economic growth and development","page_number":122,"box":{"x":101,"y":339,"width":793,"height":12}},{"id":"ea6ec313-17b0-4629-a2fd-c703b99a4ca2","block_type":"box","text":"in the geographic areas in which they do business. The Manager will take into account anticipated economic growth","page_number":122,"box":{"x":70,"y":355,"width":821,"height":11}},{"id":"d6235b31-1e0c-4a0f-a495-0c8ad0a37c7c","block_type":"box","text":"rates and other economic developments when selecting securities of utility companies.","page_number":122,"box":{"x":69,"y":370,"width":619,"height":11}},{"id":"dffe90f7-cd98-4ba7-bb24-595f29e8265f","block_type":"box","text":"Electric.","page_number":122,"box":{"x":102,"y":393,"width":54,"height":8}},{"id":"e10f1740-8db0-4269-92df-5d78219ebbd8","block_type":"box","text":"The electric utility industry consists of companies that are engaged principally in the generation,","page_number":122,"box":{"x":163,"y":392,"width":684,"height":12}},{"id":"886c549c-d4c7-4f13-8e69-13232670b213","block_type":"box","text":"transmission and sale of electric energy, although many also provide other energy-related services. In the past,","page_number":122,"box":{"x":68,"y":407,"width":793,"height":12}},{"id":"6fc32e4e-d20a-411a-b781-be4686cc7f4f","block_type":"box","text":"electric utility companies, in general, have been favorably affected by lower fuel and financing costs and the full or","page_number":122,"box":{"x":69,"y":423,"width":814,"height":11}},{"id":"59e8056e-4ac4-4b91-94f4-cac2e0ac7395","block_type":"box","text":"near completion of major construction programs. In addition, many of these companies have generated cash flows in","page_number":122,"box":{"x":69,"y":438,"width":833,"height":11}},{"id":"6f5377f7-130d-45c2-aa21-a2d856c03722","block_type":"box","text":"excess of current operating expenses and construction expenditures, permitting some degree of diversification into","page_number":122,"box":{"x":69,"y":453,"width":821,"height":11}},{"id":"0316783a-c846-41b8-90ef-2cb54964c9fb","block_type":"box","text":"unregulated businesses. Some electric utilities have also taken advantage of the right to sell power outside of their","page_number":122,"box":{"x":69,"y":468,"width":823,"height":11}},{"id":"883668eb-26e6-4d07-9268-d2ca670c60c7","block_type":"box","text":"traditional geographic areas. Electric utility companies have historically been subject to the risks associated with","page_number":122,"box":{"x":68,"y":483,"width":803,"height":11}},{"id":"feb08f4e-afe9-4c2f-93ca-8e46cd7b0338","block_type":"box","text":"increases in fuel and other operating costs, high interest costs on borrowings needed for capital construction","page_number":122,"box":{"x":70,"y":498,"width":778,"height":11}},{"id":"c3100a5e-6e9c-4f89-ba06-6644907ac0a6","block_type":"box","text":"programs, costs associated with compliance with environmental and safety regulations and changes in the regulatory","page_number":122,"box":{"x":70,"y":513,"width":836,"height":12}},{"id":"b8e2a543-df79-4c1b-9ed1-4422940bb0c9","block_type":"box","text":"climate. As interest rates declined, many utilities refinanced high cost debt and in doing so improved their fixed","page_number":122,"box":{"x":69,"y":528,"width":793,"height":12}},{"id":"f44c67d8-a3cb-4398-b8fe-f67347fc2def","block_type":"box","text":"charges coverage. Regulators, however, lowered allowed rates of return as interest rates declined and thereby","page_number":122,"box":{"x":69,"y":543,"width":786,"height":12}},{"id":"1e0bbe52-98c6-49ed-b35a-6b7148974ded","block_type":"box","text":"caused the benefits of the rate declines to be shared wholly or in par t with customers. In a period of rising interest","page_number":122,"box":{"x":69,"y":559,"width":819,"height":11}},{"id":"058e0f56-ae85-4581-898f-dbacdffbd3d4","block_type":"box","text":"rates, the allowed rates of return may not keep pace with the utilities’ increased costs. The construction and","page_number":122,"box":{"x":69,"y":574,"width":775,"height":11}},{"id":"1e0b0292-f515-429b-84ea-c838d8d7c372","block_type":"box","text":"operation of nuclear power facilities are subject to strict scrutiny by, and evolving regulations of, the Nuclear","page_number":122,"box":{"x":69,"y":589,"width":770,"height":11}},{"id":"e6afe0f2-481e-4b70-86c1-841fec654200","block_type":"box","text":"Regulatory Commission and state agencies which have comparable jurisdiction. Strict scrutiny might result in higher","page_number":122,"box":{"x":70,"y":604,"width":826,"height":11}},{"id":"6fda0c81-c830-45aa-b22d-da7714802bd3","block_type":"box","text":"operating costs and higher capital expenditures, with the risk that the regulators may disallow inclusion of these","page_number":122,"box":{"x":69,"y":619,"width":800,"height":11}},{"id":"70a1964e-c2b5-42a6-9ffe-bf2d2849659a","block_type":"box","text":"costs in rate authorizations or the risk that a company may not be permitted to operate or complete construction of a","page_number":122,"box":{"x":69,"y":634,"width":836,"height":11}},{"id":"6fdfe0df-b189-4d50-b5a0-ec9a9dfc5438","block_type":"box","text":"facility. In addition, operators of nuclear power plants may be subject to significant costs for disposal of nuclear fuel","page_number":122,"box":{"x":68,"y":649,"width":826,"height":12}},{"id":"604707c3-84d2-4e2b-929e-ae269c3d7052","block_type":"box","text":"and for decommissioning such plants.","page_number":122,"box":{"x":69,"y":664,"width":270,"height":12}},{"id":"2ab4d0ed-0561-49ba-9831-24b637bbe667","block_type":"box","text":"The rating agencies look closely at the business profile of utilities. Ratings for companies are expected to be","page_number":122,"box":{"x":101,"y":687,"width":776,"height":11}},{"id":"8fcb4952-93ac-4cf5-bb03-d7faf6241cce","block_type":"box","text":"impacted to a greater extent in the future by the division of their asset base. Electric utility companies that focus","page_number":122,"box":{"x":70,"y":702,"width":802,"height":12}},{"id":"92a93bbc-ccc5-46b3-93da-ac228817c57d","block_type":"box","text":"more on the generation of electricity may be assigned less favorable ratings as this business is expected to be","page_number":122,"box":{"x":69,"y":717,"width":791,"height":12}},{"id":"e291fbe0-dff7-4d43-92de-5a9bc444b0e1","block_type":"box","text":"competitive and the least regulated. On the other hand, companies that focus on transmission and distribution, which","page_number":122,"box":{"x":69,"y":732,"width":839,"height":12}},{"id":"67e2d8d6-357f-438d-b46e-bb666790810f","block_type":"box","text":"is expected to be the least competitive and the more regulated par t of the business, may see higher ratings given the","page_number":122,"box":{"x":70,"y":748,"width":838,"height":11}},{"id":"6397fc6e-daf3-4fb6-abc8-72789570f1fd","block_type":"box","text":"greater predictability of cash flow.","page_number":122,"box":{"x":68,"y":763,"width":239,"height":11}},{"id":"9e1423e9-2682-46a3-845a-f899b3c85e39","block_type":"box","text":"A number of states are considering or have enacted deregulation proposals. The introduction of competition into","page_number":122,"box":{"x":101,"y":785,"width":801,"height":12}},{"id":"6a798abd-f469-46f6-8a4f-a38d251dd106","block_type":"box","text":"the industry as a result of such deregulation has at times resulted in lower revenue, lower credit ratings, increased","page_number":122,"box":{"x":68,"y":801,"width":821,"height":11}},{"id":"e8925676-0b5b-49d0-9a53-12632712b0f3","block_type":"box","text":"default risk, and lower electric utility security prices. Such increased competition may also cause long-term contracts,","page_number":122,"box":{"x":69,"y":816,"width":835,"height":11}},{"id":"3ba79fcb-92db-4d4f-a4b3-c5d82e20520a","block_type":"box","text":"which electric utilities previously entered into to buy power, to become “stranded assets” which have no economic","page_number":122,"box":{"x":68,"y":831,"width":815,"height":11}},{"id":"865a7aec-3b81-486b-8093-9d511e29dc69","block_type":"box","text":"value. Any loss associated with such contracts must be absorbed by ratepayers and investors. In addition, some","page_number":122,"box":{"x":68,"y":846,"width":803,"height":11}},{"id":"1f665bd3-f4c5-47e4-b931-55994f2dcbe1","block_type":"box","text":"electric utilities have acquired electric utilities overseas to diversify, enhance earnings and gain experience in","page_number":122,"box":{"x":69,"y":861,"width":777,"height":11}},{"id":"d6d9b7a6-910d-47d3-b6d9-34c85c511b0a","block_type":"box","text":"operating in a deregulated environment. In some instances, such acquisitions have involved significant borrowings,","page_number":122,"box":{"x":69,"y":876,"width":819,"height":11}},{"id":"7c4b5c86-39ea-4df1-b88d-b79a4bcf7793","block_type":"box","text":"which have burdened the acquirer’s balance sheet. There is no assurance that current deregulation proposals will be","page_number":122,"box":{"x":68,"y":891,"width":835,"height":12}},{"id":"47476601-293b-4688-ace6-83f5c8982a1f","block_type":"box","text":"adopted. However, deregulation in any form could significantly impact the electric utilities industry.","page_number":122,"box":{"x":69,"y":906,"width":700,"height":12}},{"id":"77651984-0440-41b5-8735-a503c76a8cc7","block_type":"box","text":"II-78","page_number":122,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"098581ec-07ba-47f6-a8f7-19661a0f11a1","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":122,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"ec3e01d6-fe63-494f-b4c2-f8589e447a0e","block_type":"box","text":"Telecommunications.","page_number":123,"box":{"x":103,"y":45,"width":147,"height":9}},{"id":"822f4837-b2a3-4045-9c9a-3d55ed56425a","block_type":"box","text":"The telecommunications industry today includes both traditional telephone companies, with","page_number":123,"box":{"x":256,"y":45,"width":652,"height":11}},{"id":"c109c2a5-d5f2-4cdb-8240-b179ea774405","block_type":"box","text":"a history of broad market coverage and highly regulated businesses, and cable companies, which began as small,","page_number":123,"box":{"x":69,"y":60,"width":813,"height":11}},{"id":"9bf37ab1-280f-4f36-bbf0-0dce8dd30ef9","block_type":"box","text":"lightly regulated businesses focused on limited markets. Today these two historically different businesses are","page_number":123,"box":{"x":70,"y":75,"width":782,"height":11}},{"id":"2f4b7347-17fe-48e3-9388-577f3de93eb6","block_type":"box","text":"converging in an industry that is trending toward larger, competitive national and international markets with an","page_number":123,"box":{"x":69,"y":90,"width":786,"height":11}},{"id":"93ea3460-f2ac-49a3-9f34-ed2292b00613","block_type":"box","text":"emphasis on deregulation. Companies that distribute telephone services and provide access to the telephone","page_number":123,"box":{"x":69,"y":105,"width":784,"height":11}},{"id":"1feafe64-d293-4f26-981c-dd4a811457a8","block_type":"box","text":"networks still comprise the greatest por tion of this segment, but non-regulated activities such as wireless telephone","page_number":123,"box":{"x":69,"y":120,"width":830,"height":12}},{"id":"c35018f1-b8e4-42a6-a24d-c85176177d58","block_type":"box","text":"services, paging, data transmission and processing, equipment retailing, computer software and hardware and","page_number":123,"box":{"x":69,"y":135,"width":790,"height":12}},{"id":"30015333-d9cf-4d89-b624-d35acf4923fb","block_type":"box","text":"internet services are becoming increasingly significant components as well. In par ticular, wireless and internet","page_number":123,"box":{"x":70,"y":150,"width":788,"height":12}},{"id":"acb1e20f-f986-4f92-af1c-b43fa72ce7cb","block_type":"box","text":"telephone services continue to gain market share at the expense of traditional telephone companies. The presence","page_number":123,"box":{"x":68,"y":166,"width":825,"height":11}},{"id":"8a1962d4-77b5-4bd0-9576-eafb11c86a5a","block_type":"box","text":"of unregulated companies in this industry and the entry of traditional telephone companies into unregulated or less","page_number":123,"box":{"x":69,"y":181,"width":823,"height":11}},{"id":"da9684a5-ed88-4fcf-9f9c-f1af43a38094","block_type":"box","text":"regulated businesses provide significant investment oppor tunities with companies that may increase their earnings","page_number":123,"box":{"x":69,"y":196,"width":821,"height":11}},{"id":"f46447f4-2a23-4545-90d5-6a37baeb1c24","block_type":"box","text":"at faster rates than had been allowed in traditional regulated businesses. Still, increasing competition, technological","page_number":123,"box":{"x":69,"y":211,"width":830,"height":11}},{"id":"7756ad89-b4c4-4fe7-8dbc-1fd4dd9fb495","block_type":"box","text":"innovations and other structural changes could adversely affect the profitability of such utilities and the growth rate","page_number":123,"box":{"x":70,"y":226,"width":821,"height":11}},{"id":"cc5fa04d-fc15-44f2-8982-654f6b2d3322","block_type":"box","text":"of their dividends. Given mergers and proposed legislation and enforcement changes, it is likely that both traditional","page_number":123,"box":{"x":69,"y":241,"width":827,"height":11}},{"id":"87874d97-3414-47fd-ac57-f4d99d62d398","block_type":"box","text":"telephone companies and cable companies will continue to provide an expanding range of utility services to both","page_number":123,"box":{"x":68,"y":256,"width":804,"height":12}},{"id":"c53fc967-79b8-46c0-a28d-42ae8f34cb72","block_type":"box","text":"residential, corporate and governmental customers.","page_number":123,"box":{"x":69,"y":272,"width":367,"height":11}},{"id":"ee5e5a76-889b-45ae-9169-cc18dcba1d41","block_type":"box","text":"Gas.","page_number":123,"box":{"x":102,"y":294,"width":31,"height":9}},{"id":"f6a2febb-0f66-46e4-ad9a-4f16b661ee5a","block_type":"box","text":"Gas transmission companies and gas distribution companies are undergoing significant changes. In the","page_number":123,"box":{"x":139,"y":294,"width":740,"height":11}},{"id":"4b7b1649-80ba-4381-85db-74e5b86f6954","block_type":"box","text":"United States, interstate transmission companies are regulated by the Federal Energy Regulatory Commission, which","page_number":123,"box":{"x":70,"y":309,"width":834,"height":11}},{"id":"b8c42561-a014-4afe-85b5-1ffe93bccddd","block_type":"box","text":"is reducing its regulation of the industry. Many companies have diversified into oil and gas exploration and","page_number":123,"box":{"x":70,"y":324,"width":756,"height":12}},{"id":"9f652b59-a96d-4d23-873c-39830aac1c25","block_type":"box","text":"development, making returns more sensitive to energy prices. In the recent decade, gas utility companies have been","page_number":123,"box":{"x":69,"y":340,"width":831,"height":11}},{"id":"74ffca8c-8b24-4f05-a654-e20c704c85d6","block_type":"box","text":"adversely affected by disruptions in the oil industry and have also been affected by increased concentration and","page_number":123,"box":{"x":69,"y":355,"width":801,"height":11}},{"id":"e9cf2990-5186-47a4-ad73-a5b4cc59feda","block_type":"box","text":"competition. In the opinion of the Manager, however, environmental considerations could improve the gas industry","page_number":123,"box":{"x":69,"y":370,"width":815,"height":11}},{"id":"dfd998fa-23a6-49f5-8a62-6cb65f3c36b9","block_type":"box","text":"outlook in the future. For example, natural gas is the cleanest of the hydrocarbon fuels, and this may result in","page_number":123,"box":{"x":69,"y":385,"width":782,"height":11}},{"id":"dc8a57df-6bab-422a-a608-36fd19f50bc6","block_type":"box","text":"incremental shifts in fuel consumption toward natural gas and away from oil and coal, even for electricity generation.","page_number":123,"box":{"x":70,"y":400,"width":829,"height":11}},{"id":"becf0343-6118-4d18-bb6f-441e067ae240","block_type":"box","text":"However, technological or regulatory changes within the industry may delay or prevent this result.","page_number":123,"box":{"x":70,"y":415,"width":691,"height":11}},{"id":"7a158298-1d2d-44ad-afe9-094e02b7fedd","block_type":"box","text":"Water.","page_number":123,"box":{"x":103,"y":438,"width":42,"height":9}},{"id":"63cdebdf-ea34-4b15-8cc7-c11d46d903e5","block_type":"box","text":"Water supply utilities are companies that collect, purify, distribute and sell water. In the United States and","page_number":123,"box":{"x":151,"y":438,"width":754,"height":11}},{"id":"58aa67af-da5b-4257-9c9d-29322e81ebce","block_type":"box","text":"around the world the industry is highly fragmented because most of the supplies are owned by local authorities.","page_number":123,"box":{"x":69,"y":453,"width":796,"height":11}},{"id":"5da33f79-8ad3-49af-bf04-62917fb18461","block_type":"box","text":"Companies in this industry are generally mature and are experiencing little or no per capita volume growth. In the","page_number":123,"box":{"x":69,"y":468,"width":806,"height":11}},{"id":"38f5b499-868b-4b86-85dd-447876a9efa8","block_type":"box","text":"opinion of the Manager, there may be oppor tunities for cer tain companies to acquire other water utility companies","page_number":123,"box":{"x":69,"y":483,"width":814,"height":11}},{"id":"cc4e72ba-5fb6-4a71-8a56-f525f006348a","block_type":"box","text":"and for foreign acquisition of domestic companies. The Manager believes that favorable investment oppor tunities","page_number":123,"box":{"x":69,"y":498,"width":808,"height":11}},{"id":"bcf77ef7-db26-4270-8f0c-988188e03935","block_type":"box","text":"may result from consolidation of this segment. As with other utilities, however, increased regulation, increased costs","page_number":123,"box":{"x":69,"y":513,"width":832,"height":12}},{"id":"22194f3b-bb16-44ae-97e0-e1dd6c4711a3","block_type":"box","text":"and potential disruptions in supply may adversely affect investments in water supply utilities.","page_number":123,"box":{"x":69,"y":528,"width":662,"height":12}},{"id":"7bfac195-503b-4159-bd64-5c3d67715491","block_type":"box","text":"Utility Industries Generally.","page_number":123,"box":{"x":103,"y":551,"width":186,"height":11}},{"id":"e60274d4-06ff-45b8-888a-38dd298e91e2","block_type":"box","text":"There can be no assurance that the positive developments noted above, including","page_number":123,"box":{"x":296,"y":551,"width":584,"height":11}},{"id":"125b13b9-38c2-4704-a93f-2453f75a2823","block_type":"box","text":"those relating to privatization and changing regulation, will occur or that risk factors other than those noted above will","page_number":123,"box":{"x":68,"y":566,"width":837,"height":11}},{"id":"030cd07a-96de-4263-b3e7-6856ceefff2a","block_type":"box","text":"not develop in the future.","page_number":123,"box":{"x":69,"y":581,"width":178,"height":11}},{"id":"312984b7-7293-4702-9570-569525637e50","block_type":"box","text":"When-Issued Securities, Delayed Delivery Securities and Forward Commitments.","page_number":123,"box":{"x":103,"y":604,"width":585,"height":11}},{"id":"e07eeada-abb2-4fe3-a9e0-3642dd176a08","block_type":"box","text":"A Fund may purchase or sell","page_number":123,"box":{"x":694,"y":604,"width":200,"height":11}},{"id":"548f4314-b417-42fc-8ee8-5fc40ff12d57","block_type":"box","text":"securities that it is entitled to receive on a when-issued basis. A Fund may also purchase or sell securities on a","page_number":123,"box":{"x":69,"y":619,"width":795,"height":11}},{"id":"b0b1fcfc-c5c1-488b-8f23-b07e125ba1fd","block_type":"box","text":"delayed delivery basis or through a forward commitment (including on a TBA (to be announced) basis). These","page_number":123,"box":{"x":69,"y":634,"width":777,"height":12}},{"id":"8482e0af-b5b4-4524-ba1b-992d7ed7421b","block_type":"box","text":"transactions involve the purchase or sale of securities by a Fund at an established price with payment and delivery","page_number":123,"box":{"x":68,"y":649,"width":820,"height":12}},{"id":"6f72bf58-c68d-4f6a-8b00-25b4313ced2a","block_type":"box","text":"taking place in the future. The Fund enters into these transactions to obtain what is considered an advantageous","page_number":123,"box":{"x":68,"y":664,"width":807,"height":12}},{"id":"2ae41642-59a4-4f57-b186-f8f1856c5818","block_type":"box","text":"price to the Fund at the time of entering into the transaction.","page_number":123,"box":{"x":70,"y":680,"width":430,"height":11}},{"id":"52d5b519-cff5-4fbb-ab1a-1b6fe17bf3a4","block_type":"box","text":"Pursuant to recommendations of the Treasury Market Practices Group, which is sponsored by the Federal","page_number":123,"box":{"x":102,"y":702,"width":750,"height":11}},{"id":"d93dc0ca-ae28-486f-b085-635bf0acc37c","block_type":"box","text":"Reserve Bank of New York, a Fund or its counterpar ty generally will be required to post collateral when entering into","page_number":123,"box":{"x":70,"y":717,"width":823,"height":12}},{"id":"dc3cf828-6019-414a-bbcb-51b9cbc7aecd","block_type":"box","text":"cer tain forward-settling transactions, including without limitation TBA transactions. FINRA rules have also been","page_number":123,"box":{"x":69,"y":732,"width":788,"height":12}},{"id":"307ae891-dd6b-41b8-8efa-d2473c7417fe","block_type":"box","text":"implemented that include mandatory margin requirements for the TBA market with limited exceptions. The","page_number":123,"box":{"x":70,"y":748,"width":755,"height":11}},{"id":"fe03dbd2-b212-4533-9ef4-df420f33a4c3","block_type":"box","text":"collateralization of TBA trades is intended to mitigate counterpar ty credit risk between trade and settlement, but","page_number":123,"box":{"x":69,"y":763,"width":799,"height":11}},{"id":"bdfcc4b6-ce70-42fe-9595-8ed622a850df","block_type":"box","text":"could increase the cost of TBA transactions and impose added operational complexity.","page_number":123,"box":{"x":69,"y":778,"width":614,"height":11}},{"id":"3618a312-69bf-4c7e-9482-0e455c160c4b","block_type":"box","text":"There can be no assurance that a security purchased on a when-issued basis will be issued or that a security","page_number":123,"box":{"x":101,"y":801,"width":780,"height":11}},{"id":"3c0e3396-2d8c-4ed6-a6a4-971c2471cda1","block_type":"box","text":"purchased or sold on a delayed delivery basis or through a forward commitment will be delivered. Also, the value of","page_number":123,"box":{"x":70,"y":816,"width":823,"height":11}},{"id":"d1f674a7-0259-4595-8214-7ade074845a5","block_type":"box","text":"securities in these transactions on the delivery date may be more or less than the price paid by the Fund to purchase","page_number":123,"box":{"x":69,"y":831,"width":838,"height":11}},{"id":"6bec55d9-81b9-4178-92d7-ba9e7aefc112","block_type":"box","text":"the securities. The Fund will lose money if the value of the security in such a transaction declines below the purchase","page_number":123,"box":{"x":68,"y":846,"width":839,"height":11}},{"id":"7e07d902-1cd6-40c3-ab86-a500d97d61e5","block_type":"box","text":"price and will not benefit if the value of the security appreciates above the sale price during the commitment period.","page_number":123,"box":{"x":70,"y":861,"width":824,"height":11}},{"id":"c3aa8bd5-778f-44c6-943c-1995dbcc09a4","block_type":"box","text":"II-79","page_number":123,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"ea5b416a-319c-4311-8038-17ecc7662176","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":123,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"abe7514c-beda-4f31-bd9b-3e5434d0b78e","block_type":"box","text":"If deemed advisable as a matter of investment strategy, a Fund may dispose of or renegotiate a commitment","page_number":124,"box":{"x":102,"y":45,"width":776,"height":11}},{"id":"1339fa0e-3a7f-43e7-89d3-3ec44909debe","block_type":"box","text":"after it has been entered into, and may sell securities it has committed to purchase before those securities are","page_number":124,"box":{"x":69,"y":60,"width":795,"height":11}},{"id":"213cc6a4-5626-43dd-bb6f-ef1f8cee0b35","block_type":"box","text":"delivered to the Fund on the settlement date. In these cases the Fund may realize a taxable capital gain or loss.","page_number":124,"box":{"x":69,"y":75,"width":799,"height":11}},{"id":"be4edfbd-5d0b-43da-896e-3ff01c61a5ea","block_type":"box","text":"When a Fund engages in when-issued, TBA or forward commitment transactions, it relies on the other par ty to","page_number":124,"box":{"x":101,"y":98,"width":784,"height":11}},{"id":"6584cfbd-51d4-4433-8b19-3d400b0787e6","block_type":"box","text":"consummate the trade. Failure of such par ty to do so may result in the Fund’s incurring a loss or missing an","page_number":124,"box":{"x":69,"y":113,"width":772,"height":11}},{"id":"a86e4180-71ba-4bb6-8291-d0cb3bc77316","block_type":"box","text":"oppor tunity to obtain a price considered to be advantageous.","page_number":124,"box":{"x":69,"y":128,"width":434,"height":11}},{"id":"8fee9d55-228c-44ae-8c63-7e46282999a0","block_type":"box","text":"The market value of the securities underlying a commitment to purchase securities, and any subsequent","page_number":124,"box":{"x":101,"y":150,"width":745,"height":12}},{"id":"98f75c8f-e249-493c-85aa-ddf0a7e20ae9","block_type":"box","text":"fluctuations in their market value, is taken into account when determining the market value of a Fund star ting on the","page_number":124,"box":{"x":68,"y":166,"width":831,"height":11}},{"id":"cd7e6800-23ca-4b65-bca0-8e15a5957481","block_type":"box","text":"day the Fund agrees to purchase the securities. The Fund does not earn interest on the securities it has committed","page_number":124,"box":{"x":69,"y":181,"width":823,"height":11}},{"id":"d41da89b-d098-4111-9da1-bb084378d80d","block_type":"box","text":"to purchase until they are paid for and delivered on the settlement date.","page_number":124,"box":{"x":68,"y":196,"width":514,"height":11}},{"id":"b9fa24aa-8018-40af-8b29-a235a2bbc71e","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into when-issued or forward-settling","page_number":124,"box":{"x":102,"y":218,"width":759,"height":12}},{"id":"2f7f0925-a2c4-4466-8889-2ebd7193cc32","block_type":"box","text":"securities (","page_number":124,"box":{"x":69,"y":234,"width":78,"height":11}},{"id":"27e3a733-e82f-48bc-a8be-148070fedda2","block_type":"box","text":"e.g.","page_number":124,"box":{"x":148,"y":235,"width":25,"height":10}},{"id":"aa0978d6-2964-4019-9388-e032cb01ec0c","block_type":"box","text":", firm and standby commitments, including TBA commitments, and dollar rolls) and non-standard","page_number":124,"box":{"x":176,"y":234,"width":686,"height":11}},{"id":"e5fa39aa-4f20-4d84-95f8-bef64ae841ed","block_type":"box","text":"settlement cycle securities notwithstanding the limitation on the issuance of senior securities in Section 18 of the","page_number":124,"box":{"x":69,"y":249,"width":813,"height":11}},{"id":"6f7888c7-5a69-4d9a-b933-982d2a6df1a5","block_type":"box","text":"Investment Company Act, provided that the Fund intends to physically settle the transaction and the transaction will","page_number":124,"box":{"x":70,"y":264,"width":822,"height":11}},{"id":"a9a517d8-c690-406b-bdba-1b974b73fc57","block_type":"box","text":"settle within 35 days of its trade date (the “Delayed-Settlement Securities Provision”). If a when-issued, forward","page_number":124,"box":{"x":69,"y":279,"width":802,"height":11}},{"id":"df4f411f-282d-4b0e-b6e1-fc4cc06dd3cf","block_type":"box","text":"settling or non-standard settlement cycle security does not satisfy the Delayed-Settlement Securities Provision, then","page_number":124,"box":{"x":69,"y":294,"width":826,"height":11}},{"id":"cfc53471-f0c3-442a-b20e-91c8a95ec645","block_type":"box","text":"it is treated as a Derivatives Transaction under Rule 18f-4. See “—Derivatives — Regulation of Derivatives — Rule","page_number":124,"box":{"x":70,"y":309,"width":816,"height":11}},{"id":"aea7febe-58b0-4310-994b-b2bab5f8154f","block_type":"box","text":"18f-4 under the Investment Company Act” above.","page_number":124,"box":{"x":70,"y":324,"width":349,"height":11}},{"id":"c0b9b505-5e7f-4711-9ab9-7c878c0aa4cc","block_type":"box","text":"Regulations adopted by global prudential regulators require cer tain bank-regulated counterpar ties and cer tain of","page_number":124,"box":{"x":102,"y":347,"width":800,"height":11}},{"id":"07e989a7-ca5b-41e7-a5fd-2a3d7f8674c1","block_type":"box","text":"their affiliates to include in cer tain financial contracts, including many agreements with respect to when-issued, TBA","page_number":124,"box":{"x":68,"y":362,"width":829,"height":11}},{"id":"7b016fbb-b646-4deb-8467-4bd71e5bfbcb","block_type":"box","text":"and forward commitment transactions, terms that delay or restrict the rights of counterpar ties, such as a Fund, to","page_number":124,"box":{"x":69,"y":377,"width":814,"height":12}},{"id":"212f60cb-ade2-4a5f-b17a-777b3d80ecc0","block_type":"box","text":"terminate such agreements, foreclose upon collateral, exercise other default rights or restrict transfers of credit","page_number":124,"box":{"x":68,"y":392,"width":799,"height":12}},{"id":"b206efd7-fad4-4273-b47d-8e9a5407cc6e","block_type":"box","text":"suppor t in the event that the counterpar ty and/or its affiliates are subject to cer tain types of resolution or insolvency","page_number":124,"box":{"x":69,"y":407,"width":836,"height":12}},{"id":"db980b59-dfa3-4ff3-9040-dd1e70faa363","block_type":"box","text":"proceedings. It is possible that these requirements, as well as potential additional government regulation and other","page_number":124,"box":{"x":70,"y":423,"width":824,"height":11}},{"id":"9f490c28-954b-4f3c-976c-0a1e1d70629e","block_type":"box","text":"developments in the market, could adversely affect a Fund’s ability to terminate existing agreements with respect to","page_number":124,"box":{"x":69,"y":438,"width":829,"height":11}},{"id":"33a8fa09-5635-45d0-aaf9-5e547d1c7a2b","block_type":"box","text":"these transactions or to realize amounts to be received under such agreements.","page_number":124,"box":{"x":68,"y":453,"width":573,"height":11}},{"id":"f30065c6-499a-4a51-abc6-468560134b19","block_type":"box","text":"Yields and Ratings.","page_number":124,"box":{"x":103,"y":476,"width":139,"height":11}},{"id":"3fb399e6-8306-4de5-93fc-117695d0121b","block_type":"box","text":"The yields on cer tain obligations are dependent on a variety of factors, including general","page_number":124,"box":{"x":247,"y":475,"width":628,"height":12}},{"id":"44734594-af37-459e-9bdd-93d1eeeb7baf","block_type":"box","text":"market conditions, conditions in the par ticular market for the obligation, the financial condition of the issuer, the size","page_number":124,"box":{"x":69,"y":491,"width":834,"height":11}},{"id":"777d3c92-9696-4cde-a89e-f9d285c79faa","block_type":"box","text":"of the offering, the maturity of the obligation and the ratings of the issue. The ratings of Moody’s, Fitch and S&P","page_number":124,"box":{"x":69,"y":506,"width":799,"height":11}},{"id":"5b57d3f7-a061-45c8-871e-48fb6f2682a5","block_type":"box","text":"represent their respective opinions as to the quality of the obligations they under take to rate. Ratings, however, are","page_number":124,"box":{"x":69,"y":521,"width":824,"height":11}},{"id":"9d383872-fc39-495b-a6b9-37ff3bdbde1d","block_type":"box","text":"general and are not absolute standards of quality. Consequently, obligations with the same rating, maturity and","page_number":124,"box":{"x":68,"y":536,"width":792,"height":11}},{"id":"d0f73c36-60e2-4de5-b856-5ce65d8e15a1","block_type":"box","text":"interest rate may have different market prices. Subsequent to its purchase by a Fund, a rated security may cease to","page_number":124,"box":{"x":70,"y":551,"width":827,"height":11}},{"id":"e94840b9-b10e-434c-8793-3d7f2b02b34d","block_type":"box","text":"be rated. A Fund’s Manager or sub-adviser will consider such an event in determining whether the Fund should","page_number":124,"box":{"x":69,"y":566,"width":786,"height":11}},{"id":"dd4b3b0d-a334-42ee-adcc-f52a66640078","block_type":"box","text":"continue to hold the security.","page_number":124,"box":{"x":69,"y":582,"width":204,"height":10}},{"id":"63dfd39a-6bcf-42be-a138-832e0c0f275f","block_type":"box","text":"Zero Coupon Securities.","page_number":124,"box":{"x":102,"y":604,"width":175,"height":11}},{"id":"b785f45c-3894-4df9-9670-1a603ecf7645","block_type":"box","text":"Zero coupon securities are securities that are sold at a discount to par value and do","page_number":124,"box":{"x":283,"y":604,"width":601,"height":11}},{"id":"0bfff822-8b03-471c-a3de-153f63f23760","block_type":"box","text":"not pay interest during the life of the security. The discount approximates the total amount of interest the security will","page_number":124,"box":{"x":69,"y":619,"width":837,"height":11}},{"id":"28cd4f1d-2387-44ce-a855-d63d828f6517","block_type":"box","text":"accrue and compound over the period until maturity at a rate of interest reflecting the market rate of the security at","page_number":124,"box":{"x":69,"y":634,"width":822,"height":12}},{"id":"01188780-737d-44aa-8fd2-e6eaa68e2b02","block_type":"box","text":"the time of issuance. Upon maturity, the holder of a zero coupon security is entitled to receive the par value of the","page_number":124,"box":{"x":68,"y":649,"width":814,"height":12}},{"id":"38ac8f1a-27a1-411b-a0fd-1449c8478ccf","block_type":"box","text":"security.","page_number":124,"box":{"x":69,"y":665,"width":57,"height":11}},{"id":"f6d4b3f9-d7f8-4359-819c-3d463f055910","block_type":"box","text":"While interest payments are not made on such securities, holders of such securities are deemed to have","page_number":124,"box":{"x":101,"y":687,"width":749,"height":11}},{"id":"eaec07b4-0fa0-41c0-9778-ab1a91eca38e","block_type":"box","text":"received income (“phantom income”) annually, notwithstanding that cash may not be received currently. The effect of","page_number":124,"box":{"x":69,"y":702,"width":835,"height":12}},{"id":"35ecc2ed-6ebe-47df-a79e-bd01b026c351","block_type":"box","text":"owning instruments that do not make current interest payments is that a fixed yield is earned not only on the original","page_number":124,"box":{"x":69,"y":717,"width":833,"height":12}},{"id":"36b0b42c-0e8a-49e4-a8ab-d85c7cc1faea","block_type":"box","text":"investment but also, in effect, on all discount accretion during the life of the obligations. This implicit reinvestment of","page_number":124,"box":{"x":70,"y":732,"width":836,"height":12}},{"id":"0b833fa8-e665-4c12-8dec-20cd54e85a50","block_type":"box","text":"earnings at a fixed rate eliminates the risk of being unable to invest distributions at a rate as high as the implicit","page_number":124,"box":{"x":69,"y":748,"width":804,"height":11}},{"id":"af8a3a19-fdd1-4dae-8d22-33f6c8adbe5e","block_type":"box","text":"yield on the zero coupon bond, but at the same time eliminates the holder’s ability to reinvest at higher rates in the","page_number":124,"box":{"x":68,"y":763,"width":824,"height":11}},{"id":"bfd4c246-f2cb-4225-9ae3-47e839385a8f","block_type":"box","text":"future. For this reason, some of these securities may be subject to substantially greater price fluctuations during","page_number":124,"box":{"x":68,"y":778,"width":805,"height":11}},{"id":"b25b0e98-9f91-44a8-bd3a-f746302e19ee","block_type":"box","text":"periods of changing market interest rates than are comparable securities that pay interest currently. Longer term zero","page_number":124,"box":{"x":70,"y":793,"width":837,"height":11}},{"id":"9c362016-af7f-4485-931f-d7c84a773e44","block_type":"box","text":"coupon bonds are more exposed to interest rate risk than shor ter term zero coupon bonds. These investments","page_number":124,"box":{"x":69,"y":808,"width":791,"height":11}},{"id":"2f4f2ea6-a705-4b9a-985e-45b53c824c44","block_type":"box","text":"benefit the issuer by mitigating its need for cash to meet debt service, but also require a higher rate of return to","page_number":124,"box":{"x":69,"y":823,"width":800,"height":12}},{"id":"a7e26589-dc27-41d9-a6f5-76dfad93faa6","block_type":"box","text":"attract investors who are willing to defer receipt of cash.","page_number":124,"box":{"x":69,"y":838,"width":400,"height":12}},{"id":"c5c82f25-3216-461c-9ac5-ac6680da7253","block_type":"box","text":"A Fund accrues income with respect to these securities for U.S. federal income tax and accounting purposes","page_number":124,"box":{"x":101,"y":861,"width":775,"height":11}},{"id":"b1b908c4-b53e-446d-8835-daa087319ac2","block_type":"box","text":"prior to the receipt of cash payments. Zero coupon securities may be subject to greater fluctuation in value and less","page_number":124,"box":{"x":70,"y":876,"width":827,"height":11}},{"id":"538f6c3d-b68a-4806-ae87-3c8bfab50df8","block_type":"box","text":"liquidity in the event of adverse market conditions than comparably rated securities that pay cash interest at regular","page_number":124,"box":{"x":70,"y":891,"width":826,"height":12}},{"id":"00f53829-6620-4353-bd0f-a0da75a9a24f","block_type":"box","text":"intervals.","page_number":124,"box":{"x":70,"y":907,"width":64,"height":8}},{"id":"aa6c808c-f568-4b09-ac4b-47fb31a6f384","block_type":"box","text":"II-80","page_number":124,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"2e6e393d-862f-4cd6-9b45-3a9d2ac11f5d","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":124,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"78d4f213-083b-489c-8f0d-cb4b4ee9af67","block_type":"box","text":"Fur ther, to maintain its qualification for pass-through treatment under the U.S. federal tax laws, a Fund is","page_number":125,"box":{"x":102,"y":45,"width":749,"height":11}},{"id":"d32c6c17-3568-4858-9c1d-6fbea3c2cbd2","block_type":"box","text":"required to distribute income to its shareholders and, consequently, may have to dispose of other, more liquid","page_number":125,"box":{"x":69,"y":60,"width":784,"height":11}},{"id":"f6e84450-1b25-48af-a068-97b411654763","block_type":"box","text":"por tfolio securities under disadvantageous circumstances or may have to leverage itself by borrowing in order to","page_number":125,"box":{"x":70,"y":75,"width":799,"height":11}},{"id":"089331bc-a976-4443-9b23-260444d3d1ba","block_type":"box","text":"generate the cash to satisfy these distributions. The required distributions may result in an increase in a Fund’s","page_number":125,"box":{"x":68,"y":90,"width":799,"height":11}},{"id":"30a95456-b121-47ab-b735-7d868f4ec761","block_type":"box","text":"exposure to zero coupon securities.","page_number":125,"box":{"x":69,"y":105,"width":253,"height":11}},{"id":"c1067f96-93bc-487e-a976-0172e5debbe7","block_type":"box","text":"In addition to the above-described risks, there are cer tain other risks related to investing in zero coupon","page_number":125,"box":{"x":102,"y":128,"width":740,"height":11}},{"id":"b9400357-0b02-4e01-ae8c-1eeaac63e591","block_type":"box","text":"securities. During a period of severe market conditions, the market for such securities may become even less liquid.","page_number":125,"box":{"x":69,"y":143,"width":829,"height":11}},{"id":"8d893f08-4e65-490b-9c19-cbdef182a1c7","block_type":"box","text":"In addition, as these securities do not pay cash interest, a Fund’s investment exposure to these securities and their","page_number":125,"box":{"x":70,"y":158,"width":829,"height":11}},{"id":"9497060b-6d1c-4213-b537-2aade393ea89","block_type":"box","text":"risks, including credit risk, will increase during the time these securities are held in the Fund’s por tfolio.","page_number":125,"box":{"x":69,"y":173,"width":741,"height":11}},{"id":"43d358cd-f639-41f8-94b2-dab4447b7b6b","block_type":"box","text":"Suitability. (All Funds)","page_number":125,"box":{"x":101,"y":196,"width":161,"height":11}},{"id":"2963c5fa-44c2-4cf0-9ece-e09bb0dead97","block_type":"box","text":"The economic benefit of an investment in any Fund depends upon many factors beyond the control of the Fund,","page_number":125,"box":{"x":101,"y":218,"width":793,"height":12}},{"id":"c7572ff8-a2da-4cc3-a989-34d1aa3e4fff","block_type":"box","text":"the Manager and its affiliates. Each Fund should be considered a vehicle for diversification and not as a balanced","page_number":125,"box":{"x":68,"y":234,"width":811,"height":11}},{"id":"5c77c7e2-be90-414b-8a95-6adc33a0e20d","block_type":"box","text":"investment program. The suitability for any par ticular investor of a purchase of shares in a Fund will depend upon,","page_number":125,"box":{"x":70,"y":249,"width":810,"height":11}},{"id":"9a2813ca-1989-4c2d-9f65-68121d880e7a","block_type":"box","text":"among other things, such investor’s investment objectives and such investor’s ability to accept the risks associated","page_number":125,"box":{"x":69,"y":264,"width":826,"height":11}},{"id":"1902e6ae-f58b-4573-a234-e2a5b71c5871","block_type":"box","text":"with investing in securities, including the risk of loss of principal.","page_number":125,"box":{"x":68,"y":279,"width":460,"height":11}},{"id":"cb0ee521-7188-49dc-988a-b5b6467cace2","block_type":"box","text":"Investment Restrictions. (All Funds)","page_number":125,"box":{"x":102,"y":302,"width":264,"height":11}},{"id":"e0089581-8b8d-4ad8-b488-1aedb6004f25","block_type":"box","text":"See “Investment Restrictions” or “Investment Policies,” as applicable in each Fund’s SAI for the specific","page_number":125,"box":{"x":102,"y":324,"width":745,"height":11}},{"id":"dd98acc5-c0d5-4bc2-b93b-09c4ac88e26e","block_type":"box","text":"fundamental and non-fundamental investment restrictions adopted by each Fund. In addition to those investment","page_number":125,"box":{"x":68,"y":339,"width":807,"height":12}},{"id":"635891bc-e76c-456c-bf0d-ce6e52f30b6d","block_type":"box","text":"restrictions, each Fund is also subject to the restrictions discussed below.","page_number":125,"box":{"x":69,"y":355,"width":528,"height":11}},{"id":"6edf4e62-1ef6-418c-b820-ad6645d1dbe4","block_type":"box","text":"Each Fund’s investments will be limited in order to allow the Fund to qualify as a “regulated investment","page_number":125,"box":{"x":102,"y":377,"width":735,"height":12}},{"id":"247c3711-6f42-4a48-a6dd-f284ad24c125","block_type":"box","text":"company” for purposes of the Code. See “Dividends and Taxes — Taxes” or “Taxes.” To qualify, among other","page_number":125,"box":{"x":69,"y":392,"width":775,"height":12}},{"id":"0cf68cb9-ee02-49fe-8e12-f031497d20e3","block_type":"box","text":"requirements, each Fund will limit its investments so that, at the close of each quar ter of the taxable year, (i) at least","page_number":125,"box":{"x":69,"y":407,"width":837,"height":12}},{"id":"5aec61c6-6f52-477c-85cb-0bdcb0c49739","block_type":"box","text":"50% of the market value of each Fund’s assets is represented by cash, securities of other regulated investment","page_number":125,"box":{"x":69,"y":423,"width":799,"height":11}},{"id":"6048e30a-5520-4ddc-8083-0633d1cb68b2","block_type":"box","text":"companies, U.S. Government Securities and other securities, with such other securities limited, in respect of any one","page_number":125,"box":{"x":69,"y":438,"width":837,"height":11}},{"id":"e3878abc-6e05-4ed1-970d-012131ff5fd8","block_type":"box","text":"issuer, to an amount not greater in value than 5% of the Fund’s assets and not greater than 10% of the outstanding","page_number":125,"box":{"x":70,"y":453,"width":825,"height":11}},{"id":"046e2d89-4921-4b37-9d4c-b82948a81478","block_type":"box","text":"voting securities of such issuer and (ii) not more than 25% of the value of its assets is invested in the securities","page_number":125,"box":{"x":68,"y":468,"width":802,"height":11}},{"id":"bf860f1b-512d-4a3b-b933-c214b848806a","block_type":"box","text":"(other than U.S. Government Securities or securities of other regulated investment companies) of any one issuer, any","page_number":125,"box":{"x":69,"y":483,"width":837,"height":11}},{"id":"252cefda-28cd-464f-9512-b7a7410a4ccb","block_type":"box","text":"two or more issuers that the Fund controls and that are determined to be engaged in the same or similar trades or","page_number":125,"box":{"x":68,"y":498,"width":819,"height":11}},{"id":"619c131c-96bd-474d-8be5-e0af1bf093af","block_type":"box","text":"businesses or related trades or businesses or in the securities of one or more qualified publicly traded par tnerships","page_number":125,"box":{"x":69,"y":513,"width":828,"height":11}},{"id":"bf563f3c-8e7c-452d-a983-8ed3dd86c53e","block_type":"box","text":"(","page_number":125,"box":{"x":69,"y":529,"width":3,"height":10}},{"id":"442ff1de-692c-4ff3-b01e-d54ee3ff8f7e","block_type":"box","text":"i.e.","page_number":125,"box":{"x":74,"y":529,"width":21,"height":8}},{"id":"53a7f0ff-a6ab-44dc-9e92-ed798d28cf30","block_type":"box","text":", par tnerships that are traded on an established securities market or tradable on a secondary market, other than","page_number":125,"box":{"x":97,"y":529,"width":806,"height":11}},{"id":"9da8dbf0-e7cd-4a93-8016-a4f0577c2c76","block_type":"box","text":"par tnerships that derive 90% of their income from interest, dividends, capital gains and other traditionally permitted","page_number":125,"box":{"x":70,"y":543,"width":824,"height":12}},{"id":"26326ef9-c2f5-487b-9042-8ae22e9fc689","block_type":"box","text":"mutual fund income). For purposes of this restriction, the Municipal Funds generally will regard each state and each","page_number":125,"box":{"x":69,"y":559,"width":824,"height":11}},{"id":"073ace9c-2ceb-4f94-9a11-cc943641d593","block_type":"box","text":"of its political subdivisions, agencies or instrumentalities and each multi-state agency of which the state is a member","page_number":125,"box":{"x":69,"y":574,"width":838,"height":11}},{"id":"21ab7527-2991-416b-ad6c-a4368fb704c4","block_type":"box","text":"as a separate issuer. Each public authority that issues securities on behalf of a private entity generally will also be","page_number":125,"box":{"x":69,"y":589,"width":815,"height":11}},{"id":"203bea59-c7dd-4f21-b5c8-4dea775094df","block_type":"box","text":"regarded as a separate issuer, except that if the security is backed only by the assets and revenues of a non","page_number":125,"box":{"x":69,"y":604,"width":781,"height":11}},{"id":"6e109e98-505c-46d1-baf0-717c7849b4af","block_type":"box","text":"government entity, then the entity with the ultimate responsibility for the payment of interest and principal may be","page_number":125,"box":{"x":68,"y":619,"width":810,"height":11}},{"id":"c4b58fed-0c91-471f-974a-3762b2b59035","block_type":"box","text":"regarded as the sole issuer.","page_number":125,"box":{"x":69,"y":634,"width":198,"height":12}},{"id":"2c61343b-5327-4d2c-8c30-050d491274ef","block_type":"box","text":"Foreign government securities (unlike U.S. Government Securities) are not exempt from the 5%, 10% and 25%","page_number":125,"box":{"x":102,"y":657,"width":784,"height":11}},{"id":"ab3d6f70-afa5-4466-9e4a-284e12d38753","block_type":"box","text":"diversification requirements of the Code discussed above and the securities of each foreign government issuer are","page_number":125,"box":{"x":69,"y":672,"width":819,"height":11}},{"id":"82c3328d-7e1b-4832-80ed-2ee25022b3ee","block_type":"box","text":"considered to be obligations of a single issuer. These tax-related limitations may be changed by the Directors of a","page_number":125,"box":{"x":69,"y":687,"width":811,"height":11}},{"id":"69b0192e-fbab-4905-b749-24314c486b1a","block_type":"box","text":"Fund to the extent necessary to comply with changes to the U.S. federal tax requirements. A Fund that is","page_number":125,"box":{"x":70,"y":702,"width":747,"height":12}},{"id":"fcdbe502-7db5-4f46-883a-6ed4af10bed4","block_type":"box","text":"“diversified” under the Investment Company Act must satisfy the foregoing 5% and 10% requirements with respect to","page_number":125,"box":{"x":70,"y":717,"width":834,"height":12}},{"id":"b48dbd66-847c-429d-9f33-44cb612e7658","block_type":"box","text":"75% of its total assets.","page_number":125,"box":{"x":69,"y":732,"width":165,"height":10}},{"id":"ebc181cd-8d58-4407-a976-4c6a57d2843e","block_type":"box","text":"MANAGEMENT AND OTHER SERVICE ARRANGEMENTS","page_number":125,"box":{"x":268,"y":762,"width":442,"height":10}},{"id":"bf789b1c-e3e4-4317-ad89-af6f7614e2f4","block_type":"box","text":"Directors and Officers","page_number":125,"box":{"x":69,"y":792,"width":159,"height":9}},{"id":"b1f480a7-9b2e-4ea2-8dac-32681f40bd8d","block_type":"box","text":"See “Information on Directors and Officers, ‘—Biographical Information,’ ‘— Share Ownership’ and ‘—","page_number":125,"box":{"x":102,"y":815,"width":733,"height":11}},{"id":"104691dc-3a6e-47b3-8ac6-08038f85a384","block_type":"box","text":"Compensation of Directors’” or “Information on Trustees and Officers, ‘—Biographical Information,’ ‘— Share","page_number":125,"box":{"x":69,"y":830,"width":783,"height":11}},{"id":"cff5bce9-17fa-4335-9117-ce357c3ee723","block_type":"box","text":"Ownership’ and ‘— Compensation of Trustees’,” as applicable, in Par t I of each Fund’s SAI for biographical and","page_number":125,"box":{"x":69,"y":845,"width":795,"height":12}},{"id":"70bd5b06-c4e4-4bf3-acae-5fde74dea624","block_type":"box","text":"cer tain other information relating to the Directors and officers of your Fund, including Directors’ compensation.","page_number":125,"box":{"x":69,"y":860,"width":789,"height":12}},{"id":"b0ff8bf1-a42a-4c0e-b81f-e290baf9c2fa","block_type":"box","text":"II-81","page_number":125,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"14e3fdeb-729c-4a0c-859e-6857c4a8e304","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":125,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"45fc491c-ee14-40ae-bb14-1edfaeb8505d","block_type":"box","text":"Management Arrangements","page_number":126,"box":{"x":69,"y":45,"width":202,"height":11}},{"id":"12f0d1fa-67c6-4c91-8ef2-1734bfac5884","block_type":"box","text":"Management Services.","page_number":126,"box":{"x":102,"y":67,"width":162,"height":12}},{"id":"02d2fba1-8241-4819-9802-74bfb755d60b","block_type":"box","text":"The Manager provides each Fund with investment advisory and management services.","page_number":126,"box":{"x":270,"y":68,"width":615,"height":11}},{"id":"20e01ce4-18f9-4a05-9d49-bd20d8b4d5e5","block_type":"box","text":"Subject to the oversight of the Board of Directors, the Manager is responsible for the actual management of a Fund’s","page_number":126,"box":{"x":69,"y":82,"width":836,"height":12}},{"id":"ce01b447-5a4e-4397-8082-8813910b06aa","block_type":"box","text":"por tfolio and reviews the Fund’s holdings in light of its own research analysis and that from other relevant sources.","page_number":126,"box":{"x":70,"y":98,"width":820,"height":11}},{"id":"d7d61d60-3af2-47e1-bcf0-4019d8c92ff0","block_type":"box","text":"The responsibility for making decisions to buy, sell or hold a par ticular security rests with the Manager. The Manager","page_number":126,"box":{"x":68,"y":113,"width":832,"height":11}},{"id":"ef836b99-ccd7-460a-b7a8-37af98766a01","block_type":"box","text":"per forms cer tain of the other administrative services and provides all the office space, facilities, equipment and","page_number":126,"box":{"x":70,"y":128,"width":801,"height":11}},{"id":"56463729-dbf1-4c1b-9529-7667afa8abcf","block_type":"box","text":"necessary personnel for management of each Fund.","page_number":126,"box":{"x":69,"y":143,"width":370,"height":11}},{"id":"3afe0d00-6396-4397-8960-6a3e71f3ae0a","block_type":"box","text":"Each Feeder Fund invests all or a por tion of its assets in shares of a Master Por tfolio. To the extent a Feeder","page_number":126,"box":{"x":102,"y":166,"width":778,"height":11}},{"id":"2f11ad24-8bc3-47ec-b919-7b33f7a1e067","block_type":"box","text":"Fund invests all of its assets in a Master Por tfolio, it does not invest directly in por tfolio securities and does not","page_number":126,"box":{"x":70,"y":181,"width":800,"height":11}},{"id":"95cccb61-b464-4911-9e8e-d88deb534a4f","block_type":"box","text":"require management services. For such Feeder Funds, por tfolio management occurs at the Master Por tfolio level.","page_number":126,"box":{"x":69,"y":196,"width":810,"height":11}},{"id":"41611b9a-764a-44cd-bb21-526ce0fbd0a0","block_type":"box","text":"Management Fee.","page_number":126,"box":{"x":102,"y":219,"width":126,"height":11}},{"id":"97c7286c-fa55-4051-a882-6b54cfa71eec","block_type":"box","text":"Each Fund has entered into a Management Agreement with the Manager pursuant to which","page_number":126,"box":{"x":235,"y":219,"width":646,"height":11}},{"id":"a5b1b946-76c4-4c97-9bf0-f179c266779e","block_type":"box","text":"the Manager receives for its services to the Fund monthly compensation at an annual rate based on the average daily","page_number":126,"box":{"x":68,"y":234,"width":841,"height":11}},{"id":"ce125cd1-9258-4cd2-90b8-a5263250154a","block_type":"box","text":"net assets of the Fund. For information regarding the fees paid by your Fund to the Manager for the Fund’s last three","page_number":126,"box":{"x":69,"y":249,"width":833,"height":11}},{"id":"d55cc108-3db9-4056-88eb-553ad5acba99","block_type":"box","text":"fiscal years or other applicable periods, see “Management, Advisory and Other Service Arrangements —","page_number":126,"box":{"x":68,"y":264,"width":746,"height":11}},{"id":"7cc29524-82e0-43a0-83d4-ef9b0ed14489","block_type":"box","text":"Management Agreement” or “Management and Advisory Arrangements,” as applicable, in Par t I of each Fund’s SAI.","page_number":126,"box":{"x":70,"y":279,"width":825,"height":11}},{"id":"39362d2f-a92f-4e85-a484-49011d1c43be","block_type":"box","text":"For Funds that do not have an administrator, each Management Agreement obligates the Manager to provide","page_number":126,"box":{"x":102,"y":302,"width":774,"height":11}},{"id":"d53624f7-340d-4edc-af26-5e89004fa49a","block_type":"box","text":"management services and to pay all compensation of and furnish office space for officers and employees of a Fund","page_number":126,"box":{"x":69,"y":317,"width":826,"height":11}},{"id":"d3dcd1e5-0f0a-4160-9869-21bce5dc8c29","block_type":"box","text":"in connection with investment and economic research, trading and investment management of the Fund, as well as","page_number":126,"box":{"x":70,"y":332,"width":820,"height":11}},{"id":"9be97569-b42e-44cf-bfc9-188f424d1195","block_type":"box","text":"the fees of all Directors of the Fund who are interested persons of the Fund. Each Fund pays all other expenses","page_number":126,"box":{"x":68,"y":347,"width":797,"height":11}},{"id":"8a42c7ad-1099-46e2-ac50-f3031b21f8b5","block_type":"box","text":"incurred in the operation of that Fund, including among other things: taxes; expenses for legal and auditing services;","page_number":126,"box":{"x":70,"y":362,"width":830,"height":11}},{"id":"d87ab9d3-6916-4572-abd7-086d870c1564","block_type":"box","text":"costs of preparing, printing and mailing proxies, shareholder repor ts, prospectuses and statements of additional","page_number":126,"box":{"x":69,"y":377,"width":802,"height":12}},{"id":"6a81e80a-2b9a-4347-be86-a401b4236d2c","block_type":"box","text":"information, except to the extent paid by BlackRock Investments, LLC (“BRIL” or the “Distributor”); charges of the","page_number":126,"box":{"x":70,"y":392,"width":809,"height":12}},{"id":"77ad93d5-64bd-4b16-80d5-4b71bb193d77","block_type":"box","text":"custodian and sub-custodian, and the transfer agent; expenses of redemption of shares; Commission fees; expenses","page_number":126,"box":{"x":69,"y":407,"width":838,"height":12}},{"id":"0c0b6032-86d9-422c-8390-529eef6a4767","block_type":"box","text":"of registering the shares under Federal, state or foreign laws; fees and expenses of Directors who are not interested","page_number":126,"box":{"x":69,"y":423,"width":830,"height":11}},{"id":"2c55d7ce-618e-4c39-a6a8-cec137b97d9b","block_type":"box","text":"persons of a Fund as defined in the Investment Company Act; accounting and pricing costs (including the daily","page_number":126,"box":{"x":70,"y":438,"width":784,"height":11}},{"id":"b00e3654-bc31-4216-bf95-a44c4d47d321","block_type":"box","text":"calculations of NAV); insurance; interest; brokerage costs; litigation and other extraordinary or non-recurring","page_number":126,"box":{"x":69,"y":453,"width":767,"height":11}},{"id":"b861bdf9-8156-431b-a417-550e9bac7d16","block_type":"box","text":"expenses; and other expenses properly payable by the Fund. Cer tain accounting services are provided to each Fund","page_number":126,"box":{"x":69,"y":468,"width":825,"height":11}},{"id":"83ce017d-c9ba-4927-b025-7cb39113f44e","block_type":"box","text":"by State Street Bank and Trust Company (“State Street”), BNY Mellon Investment Servicing (US) Inc. (“BNY Mellon”)","page_number":126,"box":{"x":69,"y":483,"width":830,"height":11}},{"id":"5fc8df73-6e54-46cf-84cf-8c495592c874","block_type":"box","text":"or JPMorgan Chase Bank, N.A. (“JPM”) pursuant to an agreement between State Street, BNY Mellon or JPM, as","page_number":126,"box":{"x":69,"y":498,"width":794,"height":11}},{"id":"3ed04f76-8f88-4811-9672-82b66f5c6830","block_type":"box","text":"applicable, and each Fund. Each Fund pays a fee for these services. In addition, the Manager provides cer tain","page_number":126,"box":{"x":69,"y":513,"width":786,"height":12}},{"id":"c4fd1b67-881c-4620-a0a4-5a9d8d51cdc0","block_type":"box","text":"accounting services to each Fund and the Fund pays the Manager a fee for such services. The Distributor pays","page_number":126,"box":{"x":69,"y":528,"width":790,"height":12}},{"id":"b0989c22-fb82-4171-8e65-2a36f71957d5","block_type":"box","text":"cer tain promotional expenses of the Funds incurred in connection with the offering of shares of the Funds. Cer tain","page_number":126,"box":{"x":69,"y":543,"width":817,"height":12}},{"id":"b5468e4f-ef39-4e62-ae7a-742dee5eb643","block_type":"box","text":"expenses are financed by each Fund pursuant to distribution plans in compliance with Rule 12b-1 under the","page_number":126,"box":{"x":69,"y":559,"width":767,"height":11}},{"id":"0bb9d57e-089b-40ec-bef0-dd020bd99507","block_type":"box","text":"Investment Company Act. See “Purchase of Shares — Distribution and/or Shareholder Servicing Plans.”","page_number":126,"box":{"x":70,"y":574,"width":743,"height":11}},{"id":"13eeeba6-a56d-41d6-9cae-bcf26238c87a","block_type":"box","text":"Sub-Advisory Fee.","page_number":126,"box":{"x":102,"y":597,"width":124,"height":11}},{"id":"2b017613-4f28-47a6-a2ba-d3bb367b782f","block_type":"box","text":"The Manager of cer tain Funds has entered into one or more sub-advisory agreements (the","page_number":126,"box":{"x":232,"y":596,"width":643,"height":12}},{"id":"8342abf1-430b-4015-9849-eec518e92aeb","block_type":"box","text":"“Sub-Advisory Agreements”) with the sub-adviser or sub-advisers identified in each such Fund’s Prospectus (the “Sub","page_number":126,"box":{"x":70,"y":612,"width":839,"height":11}},{"id":"dff2ac59-4185-4b3f-bfc3-db8c658ea844","block_type":"box","text":"Adviser”) pursuant to which the Sub-Adviser provides sub-advisory services to the Manager with respect to the Fund.","page_number":126,"box":{"x":68,"y":627,"width":830,"height":11}},{"id":"9b5244c8-30a2-428f-b63f-36bc60563aea","block_type":"box","text":"Organization of the Manager.","page_number":126,"box":{"x":102,"y":649,"width":204,"height":12}},{"id":"b1bedaf7-906b-4811-a0d0-e2b1a0b64c3d","block_type":"box","text":"BlackRock Advisors, LLC is a Delaware limited liability company and BlackRock","page_number":126,"box":{"x":313,"y":649,"width":560,"height":12}},{"id":"090e655e-da60-4430-8a88-a1d5b126ac83","block_type":"box","text":"Fund Advisors is a California corporation. Each Manager is an indirect, majority-owned subsidiary of BlackRock, Inc.","page_number":126,"box":{"x":70,"y":664,"width":819,"height":12}},{"id":"94a1729b-a240-483d-bb01-0c63db9615ec","block_type":"box","text":"BlackRock, Inc., through its subsidiaries and divisions, provides (i) investment management services to individuals","page_number":126,"box":{"x":70,"y":680,"width":817,"height":11}},{"id":"cc9bb0f4-6363-4b58-9241-934f34edb73c","block_type":"box","text":"and institutional investors through separate account management, non-discretionary advisory programs and","page_number":126,"box":{"x":69,"y":695,"width":768,"height":11}},{"id":"38523536-9dec-4ec7-91af-a7aefe8ee5c2","block_type":"box","text":"commingled investment vehicles; (ii) risk management services, investment accounting and trade processing tools;","page_number":126,"box":{"x":69,"y":710,"width":821,"height":11}},{"id":"17a503be-8905-442b-bbdb-a5d86c2e6122","block_type":"box","text":"(iii) transition management services, and (iv) securities lending services.","page_number":126,"box":{"x":69,"y":725,"width":517,"height":11}},{"id":"1500d1dc-44ce-4154-8393-cfed90c13a94","block_type":"box","text":"Duration and Termination.","page_number":126,"box":{"x":102,"y":748,"width":182,"height":9}},{"id":"c5c1bd8d-7103-4907-9dd6-752505d73466","block_type":"box","text":"Unless earlier terminated as described below, each Management Agreement and each","page_number":126,"box":{"x":292,"y":748,"width":613,"height":11}},{"id":"08ffac90-317c-4313-8f5e-67034afd9915","block_type":"box","text":"Sub-Advisory Agreement will remain in effect for an initial two year period and from year to year thereafter if approved","page_number":126,"box":{"x":69,"y":763,"width":835,"height":11}},{"id":"9a028e6c-7abc-4e7d-953e-ed3a7b763331","block_type":"box","text":"annually (a) by the Board of Directors or by a vote of a majority of the outstanding voting securities of a Fund and","page_number":126,"box":{"x":69,"y":778,"width":803,"height":11}},{"id":"56e1d2cd-24a7-4483-a2e3-a53f2e311aa3","block_type":"box","text":"(b) by a majority of the Directors of the Fund who are not par ties to such agreement or interested persons (as defined","page_number":126,"box":{"x":69,"y":793,"width":839,"height":11}},{"id":"15003dbe-073c-4981-9efd-ad21cf847f2f","block_type":"box","text":"in the Investment Company Act) of any such par ty. Each Management Agreement automatically terminates on","page_number":126,"box":{"x":70,"y":808,"width":778,"height":11}},{"id":"f6c0108c-d81f-4eec-a34c-2d521a292a26","block_type":"box","text":"assignment and may be terminated without penalty on 60 days’ written notice at the option of either par ty thereto or","page_number":126,"box":{"x":69,"y":823,"width":832,"height":12}},{"id":"ae8f73ca-320e-4b00-82d2-fcdf0d194c8a","block_type":"box","text":"by the vote of the shareholders of the applicable Fund.","page_number":126,"box":{"x":69,"y":838,"width":388,"height":11}},{"id":"54df0ca9-3058-4203-87ac-bc8655d1e073","block_type":"box","text":"II-82","page_number":126,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"fad1718a-8917-4ccf-bb0b-792065d5e061","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":126,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"4c71898d-ca9a-49d0-8ee1-92a872fbf669","block_type":"box","text":"Other Service Arrangements","page_number":127,"box":{"x":69,"y":45,"width":205,"height":11}},{"id":"48b556c2-9d63-4a34-8d4e-42baceb77ac3","block_type":"box","text":"Administrative Services and Administrative Fee.","page_number":127,"box":{"x":101,"y":67,"width":338,"height":9}},{"id":"2452c1cd-6915-46f4-8f78-d66a5d25fb2b","block_type":"box","text":"Cer tain Funds have entered into an administration agreement","page_number":127,"box":{"x":446,"y":67,"width":439,"height":12}},{"id":"97dea729-77f9-493d-a5b8-4fac0e579c3a","block_type":"box","text":"(the “Administration Agreement”) with an administrator identified in the Fund’s Prospectus and Par t I of the Fund’s","page_number":127,"box":{"x":69,"y":82,"width":818,"height":12}},{"id":"7316f204-a705-45fe-a2c7-5880cc1df51e","block_type":"box","text":"SAI (each an “Administrator”). For its services to a Fund, the Administrator receives monthly compensation at the","page_number":127,"box":{"x":69,"y":98,"width":808,"height":11}},{"id":"e5fb92e1-ef70-4de4-8d8a-d0ec0c89f8ea","block_type":"box","text":"annual rate set for th in each applicable Fund’s Prospectus. For information regarding any administrative fees paid by","page_number":127,"box":{"x":69,"y":113,"width":833,"height":11}},{"id":"d1f47b08-6559-43d3-a91b-da96b4fe8e98","block_type":"box","text":"your Fund to the Administrator for the periods indicated, see “Management, Advisory and Other Service","page_number":127,"box":{"x":68,"y":128,"width":738,"height":11}},{"id":"c37a0117-1b98-429b-8f1d-5e4fca1d2b76","block_type":"box","text":"Arrangements — Administration Agreement” or “Management and Advisory Arrangements,” as applicable, in Par t I of","page_number":127,"box":{"x":68,"y":143,"width":839,"height":11}},{"id":"040df143-f8d9-4e76-8a6f-c04e333c8f9c","block_type":"box","text":"that Fund’s SAI.","page_number":127,"box":{"x":68,"y":158,"width":113,"height":9}},{"id":"3471ba39-93fb-4ba6-b927-8a3cb787a70e","block_type":"box","text":"For Funds that have an Administrator, the Administration Agreement obligates the Administrator to provide","page_number":127,"box":{"x":102,"y":181,"width":755,"height":11}},{"id":"cc43bed6-a785-41b5-9d7d-9bce69608e9c","block_type":"box","text":"cer tain administrative services to the Fund and to pay, or cause its affiliates to pay, for maintaining its staff and","page_number":127,"box":{"x":69,"y":196,"width":800,"height":11}},{"id":"9216e317-7320-416a-b2f3-4dd2c0569dab","block_type":"box","text":"personnel and to provide office space, facilities and necessary personnel for the Fund. Each Administrator is also","page_number":127,"box":{"x":70,"y":211,"width":809,"height":11}},{"id":"da3a3deb-4d8e-4bc3-96f4-4be91f95fa49","block_type":"box","text":"obligated to pay, or cause its affiliates to pay, the fees of those officers and Directors of the Fund who are affiliated","page_number":127,"box":{"x":69,"y":226,"width":826,"height":11}},{"id":"2a061df7-e198-4daa-9676-5518c0f60569","block_type":"box","text":"persons of the Administrator or any of its affiliates.","page_number":127,"box":{"x":70,"y":241,"width":362,"height":11}},{"id":"8d521fde-f8e6-4133-aef4-a8e6b22efdde","block_type":"box","text":"Duration and Termination of Administration Agreement.","page_number":127,"box":{"x":102,"y":264,"width":390,"height":11}},{"id":"30ff69c3-eff5-435f-ad69-c9d7f8a56a87","block_type":"box","text":"Unless earlier terminated as described below, each","page_number":127,"box":{"x":499,"y":264,"width":364,"height":10}},{"id":"51d3444c-48f4-4a0a-8bf9-34056da1c61e","block_type":"box","text":"Administration Agreement with BlackRock will continue for an initial two year period and from year to year if approved","page_number":127,"box":{"x":68,"y":279,"width":832,"height":11}},{"id":"dab2beec-7263-42d0-99e5-0beb36f2f4b0","block_type":"box","text":"annually (a) by the Board of Directors of each applicable Fund or by a vote of a majority of the outstanding voting","page_number":127,"box":{"x":69,"y":294,"width":802,"height":11}},{"id":"a4ac2b85-806b-41e1-844c-b8d9b0430492","block_type":"box","text":"securities of such Fund and (b) by a majority of the Directors of the Fund who are not par ties to such contract or","page_number":127,"box":{"x":69,"y":309,"width":800,"height":11}},{"id":"cfbde537-076d-4199-8a4b-76eebd9e8167","block_type":"box","text":"interested persons (as defined in the Investment Company Act) of any such par ty. Such contract is not assignable","page_number":127,"box":{"x":70,"y":324,"width":810,"height":12}},{"id":"0c1acc49-c82a-47be-b198-c5dbee0cc7f8","block_type":"box","text":"and may be terminated without penalty on written notice at the option of either par ty thereto or by the vote of the","page_number":127,"box":{"x":69,"y":339,"width":805,"height":12}},{"id":"98040a5b-d038-4a13-9e55-ee0207be6726","block_type":"box","text":"shareholders of the Fund.","page_number":127,"box":{"x":69,"y":355,"width":181,"height":9}},{"id":"4ef46857-4a32-49d7-a8a2-aee037d38a15","block_type":"box","text":"Transfer Agency Services.","page_number":127,"box":{"x":103,"y":377,"width":180,"height":12}},{"id":"c83af18a-c258-4757-9fe5-d129a7316291","block_type":"box","text":"BNY Mellon Investment Servicing (US) Inc. (in this capacity, the “Transfer Agent”), a","page_number":127,"box":{"x":291,"y":377,"width":595,"height":12}},{"id":"eeee8720-1603-49f1-9edb-1ae311437747","block_type":"box","text":"subsidiary of The Bank of New York Mellon Corporation, acts as each Fund’s Transfer Agent pursuant to a Transfer","page_number":127,"box":{"x":69,"y":392,"width":816,"height":12}},{"id":"baf51a18-9344-4023-9c26-3b5711a1b198","block_type":"box","text":"Agency, Dividend Disbursing Agency and Shareholder Servicing Agency Agreement (the “Transfer Agency Agreement”)","page_number":127,"box":{"x":68,"y":407,"width":833,"height":12}},{"id":"cb89356b-e800-4562-be4a-085e666afc85","block_type":"box","text":"with the Funds. Pursuant to the Transfer Agency Agreement, the Transfer Agent is responsible for the issuance,","page_number":127,"box":{"x":68,"y":423,"width":792,"height":11}},{"id":"888282d8-63c4-46f7-adae-78d16368d378","block_type":"box","text":"transfer and redemption of shares and the opening and maintenance of shareholder accounts. Each Fund pays the","page_number":127,"box":{"x":68,"y":438,"width":819,"height":11}},{"id":"4eba3df8-e2c1-43e8-9d93-2af8c2996e96","block_type":"box","text":"Transfer Agent a fee for the services it receives based on the type of account and the level of services required. Each","page_number":127,"box":{"x":68,"y":453,"width":839,"height":11}},{"id":"80a80f37-7de6-4d21-9ecb-3f8d36f570fa","block_type":"box","text":"Fund reimburses the Transfer Agent’s reasonable out-of-pocket expenses and pays a fee of 0.10% of account assets","page_number":127,"box":{"x":70,"y":468,"width":831,"height":11}},{"id":"751151ce-c6e7-4767-bf60-7b02b8e2ee67","block_type":"box","text":"for cer tain accounts that par ticipate in cer tain fee-based programs sponsored by the Manager or its affiliates. For","page_number":127,"box":{"x":68,"y":483,"width":813,"height":11}},{"id":"c79d0224-b47c-4643-ae53-da5008c28fea","block_type":"box","text":"purposes of each Transfer Agency Agreement, the term “account” includes a shareholder account maintained directly","page_number":127,"box":{"x":70,"y":498,"width":836,"height":11}},{"id":"03932e42-422a-4c73-897f-100941c32899","block_type":"box","text":"by the Transfer Agent and any other account representing the beneficial interest of a person in the relevant share","page_number":127,"box":{"x":69,"y":513,"width":806,"height":12}},{"id":"dac8c7e9-7b5e-4fcd-b3d6-46550b15894d","block_type":"box","text":"class on a recordkeeping system.","page_number":127,"box":{"x":69,"y":529,"width":238,"height":11}},{"id":"2523029d-9229-4510-9a1c-c6701f2a8be3","block_type":"box","text":"Independent Registered Public Accounting Firm.","page_number":127,"box":{"x":102,"y":551,"width":338,"height":11}},{"id":"7d09eb90-f510-447f-a353-ccd40480680a","block_type":"box","text":"The Audit Committee of each Fund, the members of which are","page_number":127,"box":{"x":446,"y":551,"width":441,"height":11}},{"id":"704bb214-3b07-494f-bb96-8ab2028e8980","block_type":"box","text":"non-interested Directors of the Fund, has selected an independent registered public accounting firm for that Fund that","page_number":127,"box":{"x":69,"y":566,"width":840,"height":11}},{"id":"83cb3012-fa1a-4fe6-89f5-8b86968b4b77","block_type":"box","text":"audits the Fund’s financial statements. Please see the inside back cover page of your Fund’s Prospectus and Par t I","page_number":127,"box":{"x":69,"y":581,"width":823,"height":12}},{"id":"281e4059-1967-4e6d-a60a-10bc5f5cb28f","block_type":"box","text":"of this SAI for information on your Fund’s independent registered public accounting firm.","page_number":127,"box":{"x":69,"y":596,"width":627,"height":12}},{"id":"68961dd2-b704-48ea-b535-a6de592709a2","block_type":"box","text":"Custodian Services.","page_number":127,"box":{"x":102,"y":619,"width":141,"height":9}},{"id":"40e0b77a-3983-452c-892c-22b651793d85","block_type":"box","text":"The name and address of the custodian (the “Custodian”) of each Fund are provided on the","page_number":127,"box":{"x":249,"y":619,"width":654,"height":11}},{"id":"306aabaf-15d5-4f82-93b2-1bf1df4d9caa","block_type":"box","text":"inside back cover page of the Fund’s Prospectus. The Custodian is responsible for safeguarding and controlling the","page_number":127,"box":{"x":70,"y":634,"width":820,"height":12}},{"id":"baa8bc24-3292-4202-8942-673a40611d2b","block_type":"box","text":"Fund’s cash and securities, handling the receipt and delivery of securities and collecting interest and dividends on","page_number":127,"box":{"x":70,"y":649,"width":814,"height":12}},{"id":"22894a20-f852-4163-a409-f8b107ef6e48","block_type":"box","text":"the Fund’s investments. The Custodian is authorized to establish separate accounts in foreign currencies and to","page_number":127,"box":{"x":68,"y":664,"width":802,"height":12}},{"id":"e9c08200-b0b3-49b9-a599-eaf00e1aadee","block_type":"box","text":"cause foreign securities owned by the Fund to be held in its offices outside the United States and with cer tain foreign","page_number":127,"box":{"x":69,"y":680,"width":839,"height":11}},{"id":"35d26f62-cf2c-465b-b723-b9d1bf445409","block_type":"box","text":"banks and securities depositories. A Fund also may use special purpose custodian banks from time to time for","page_number":127,"box":{"x":69,"y":695,"width":792,"height":11}},{"id":"119f5df6-2a22-466a-ac7e-efec8668a70f","block_type":"box","text":"cer tain assets.","page_number":127,"box":{"x":69,"y":710,"width":106,"height":9}},{"id":"414259c4-734a-49d5-85bb-ec26941a8f13","block_type":"box","text":"For cer tain Feeder Funds, the Custodian also acts as the custodian of the Master Por tfolio’s assets.","page_number":127,"box":{"x":102,"y":732,"width":716,"height":11}},{"id":"1d8df9d2-2a6d-4f57-be22-35d60c0022da","block_type":"box","text":"Generally, overdraft charges, if any, are treated as interest expense. 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BlackRock, its subsidiaries and their","page_number":133,"box":{"x":102,"y":775,"width":731,"height":12}},{"id":"79aa02a3-f471-4159-b836-dab4e66a2c95","block_type":"box","text":"respective directors, officers and employees, including the business units or entities and personnel who may be","page_number":133,"box":{"x":69,"y":790,"width":799,"height":12}},{"id":"6355b732-7f46-4d39-8dbb-c72ef27592ed","block_type":"box","text":"involved in the investment activities and business operations of a Fund, are engaged worldwide in businesses,","page_number":133,"box":{"x":70,"y":806,"width":786,"height":11}},{"id":"9788fd61-6a8e-4616-8b01-1a6eb324c95c","block_type":"box","text":"including managing equities, fixed income securities, cash and alternative investments, and other financial services,","page_number":133,"box":{"x":70,"y":821,"width":829,"height":11}},{"id":"45aca6bb-c8b5-40bf-af05-578dc9e49560","block_type":"box","text":"and have interests other than that of managing the Funds. These are considerations of which investors in a Fund","page_number":133,"box":{"x":69,"y":836,"width":804,"height":11}},{"id":"89fa8b64-bc68-4f1a-8efd-2e08b846e8ec","block_type":"box","text":"should be aware, and which may cause conflicts of interest that could disadvantage a Fund and its shareholders.","page_number":133,"box":{"x":69,"y":851,"width":806,"height":11}},{"id":"55a0f466-848b-4d26-bfd5-77949a5f770e","block_type":"box","text":"These businesses and interests include potential multiple advisory, transactional, financial and other","page_number":133,"box":{"x":101,"y":874,"width":722,"height":11}},{"id":"2d515439-fe66-41a0-ae13-46c487afada7","block_type":"box","text":"relationships with, or interests in companies and interests in securities or other instruments that may be purchased","page_number":133,"box":{"x":69,"y":889,"width":827,"height":11}},{"id":"f3e0d848-9289-4eca-ab0b-bfb456bec546","block_type":"box","text":"or sold by a Fund.","page_number":133,"box":{"x":69,"y":904,"width":125,"height":11}},{"id":"f06d80d0-71f2-4231-8138-e195845d4628","block_type":"box","text":"II-89","page_number":133,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"5c188efb-7b99-425b-baf3-743ddb74c608","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":133,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"3f3c474e-dcd3-4a28-b98f-8dcd0a19be79","block_type":"box","text":"BlackRock may have proprietary interests in, and may manage or advise with respect to, accounts or funds","page_number":134,"box":{"x":102,"y":45,"width":762,"height":11}},{"id":"6c02b776-efdc-45d2-ad48-7e83314480c2","block_type":"box","text":"(including separate accounts and other funds and collective investment vehicles) that have investment objectives","page_number":134,"box":{"x":69,"y":60,"width":806,"height":11}},{"id":"3a6653ad-7865-492d-9f9b-039790bed392","block_type":"box","text":"identical or similar to those of a Fund and/or that engage in transactions in the same types of securities, currencies","page_number":134,"box":{"x":70,"y":75,"width":828,"height":11}},{"id":"8f86e5d7-2691-4204-b960-a1d8dbde6aa3","block_type":"box","text":"and instruments as the Fund. Such other funds or accounts may offer exposure to strategies that are identical or","page_number":134,"box":{"x":69,"y":90,"width":808,"height":11}},{"id":"a1ac2b94-5316-4697-84ed-27b59975b846","block_type":"box","text":"substantially similar to those of a Fund but with different fees and expenses, governance and structures, and/or","page_number":134,"box":{"x":69,"y":105,"width":803,"height":11}},{"id":"dea4437a-1630-442a-9102-cc9b2803bbdf","block_type":"box","text":"services provided by BlackRock","page_number":134,"box":{"x":69,"y":120,"width":224,"height":11}},{"id":"87d22911-46fb-42fa-bb46-bde5bb577368","block_type":"box","text":".","page_number":134,"box":{"x":295,"y":128,"width":2,"height":1}},{"id":"8b1ebd19-8f79-431d-b511-d02118c7c1d7","block_type":"box","text":"BlackRock is also a major par ticipant in the global currency, equities, swap and fixed","page_number":134,"box":{"x":304,"y":120,"width":603,"height":12}},{"id":"e5d4485e-41b0-4fa9-9ef7-073e7dab88d0","block_type":"box","text":"income markets, in each case, for the accounts of clients and, in some cases, on a proprietary basis. As such,","page_number":134,"box":{"x":70,"y":135,"width":791,"height":11}},{"id":"f2d697af-498c-467e-ac07-5fa7ce6004e2","block_type":"box","text":"BlackRock is or may be actively engaged in transactions in the same securities, currencies, and instruments in which","page_number":134,"box":{"x":70,"y":151,"width":835,"height":11}},{"id":"e0cc10ca-d38e-4deb-86c7-5c09f96d1709","block_type":"box","text":"a Fund invests.","page_number":134,"box":{"x":69,"y":166,"width":106,"height":9}},{"id":"65b16ded-f43f-4c7d-afa9-a224cd1a4988","block_type":"box","text":"Such activities could affect the prices and availability of the securities, currencies, and instruments in which a","page_number":134,"box":{"x":102,"y":188,"width":785,"height":11}},{"id":"b0103400-0f68-452e-a997-dda1f5e2950f","block_type":"box","text":"Fund invests, which could have an adverse impact on a Fund’s per formance. Such transactions, par ticularly in","page_number":134,"box":{"x":70,"y":203,"width":785,"height":12}},{"id":"76feb3cd-5b97-4967-b332-73e6d0e42d06","block_type":"box","text":"respect of most proprietary accounts or client accounts, will be executed independently of a Fund’s transactions and","page_number":134,"box":{"x":69,"y":218,"width":832,"height":12}},{"id":"b530d170-c1d8-424f-8803-779727fa0ede","block_type":"box","text":"thus at prices or rates that may be more or less favorable than those obtained by the Fund.","page_number":134,"box":{"x":68,"y":234,"width":652,"height":11}},{"id":"8551c8fa-c14e-4586-8435-ed036bf1bce5","block_type":"box","text":"In addition, the por tfolio holdings of cer tain BlackRock-advised investment vehicles managed in an identical or","page_number":134,"box":{"x":102,"y":256,"width":787,"height":12}},{"id":"1e806d8a-5b98-4e22-b356-ea6521f83bec","block_type":"box","text":"substantially similar manner as cer tain Funds are made publicly available on a more timely basis than the applicable","page_number":134,"box":{"x":69,"y":272,"width":832,"height":11}},{"id":"b7b2b447-4732-4eba-8af5-a6f2d0103d8d","block_type":"box","text":"Fund. In some cases, such por tfolio holdings are made publicly available on a daily basis. While not expected, it is","page_number":134,"box":{"x":70,"y":286,"width":816,"height":12}},{"id":"2647c1d3-9acb-4c7c-b98b-670322af8dba","block_type":"box","text":"possible that a recipient of por tfolio holdings information for such an investment vehicle could cause harm to a Fund","page_number":134,"box":{"x":70,"y":302,"width":831,"height":11}},{"id":"5b95efc1-312c-47c8-9054-4ca53599d92c","block_type":"box","text":"that is managed in an identical or substantially similar manner, including by trading ahead of or against such Fund","page_number":134,"box":{"x":68,"y":317,"width":813,"height":11}},{"id":"2903d438-1235-46c3-a0e8-49526bedd816","block_type":"box","text":"based on the information received.","page_number":134,"box":{"x":69,"y":332,"width":247,"height":9}},{"id":"90ecfa15-e80c-4f13-ab7b-cde1087bb25e","block_type":"box","text":"When BlackRock seeks to purchase or sell the same assets for client accounts, including a Fund, the assets","page_number":134,"box":{"x":101,"y":355,"width":777,"height":11}},{"id":"d7791c17-1b35-4d03-a61c-cf5ed76bcf78","block_type":"box","text":"actually purchased or sold may be allocated among the accounts on a basis determined in its good faith discretion to","page_number":134,"box":{"x":69,"y":370,"width":838,"height":11}},{"id":"1681a86b-d4dc-491c-a1f9-4fb79e9f4fa3","block_type":"box","text":"be equitable. In some cases, this system may adversely affect the size or price of the assets purchased or sold for a","page_number":134,"box":{"x":69,"y":385,"width":835,"height":11}},{"id":"0cb294b5-0e9a-4721-a1ec-edce22705fbd","block_type":"box","text":"Fund. In addition, transactions in investments by one or more other accounts managed by BlackRock may have the","page_number":134,"box":{"x":70,"y":400,"width":817,"height":11}},{"id":"43049f80-df32-4bf4-801f-25c78bce2eb0","block_type":"box","text":"effect of diluting or otherwise disadvantaging the values, prices or investment strategies of a Fund, par ticularly, but","page_number":134,"box":{"x":69,"y":415,"width":823,"height":11}},{"id":"a2b5d4fc-4273-45d1-a0ee-0461d6ce62d2","block_type":"box","text":"not limited to, with respect to small capitalization, emerging market or less liquid strategies. This may occur with","page_number":134,"box":{"x":69,"y":430,"width":803,"height":11}},{"id":"b3d1d8b1-ae74-48f9-96da-c05435ee7146","block_type":"box","text":"respect to BlackRock-advised accounts when investment decisions regarding a Fund are based on research or other","page_number":134,"box":{"x":69,"y":446,"width":827,"height":11}},{"id":"6f3bb18d-d5ad-4daa-8198-0ac28779ef05","block_type":"box","text":"information that is also used to suppor t decisions for other accounts. When BlackRock implements a por tfolio","page_number":134,"box":{"x":70,"y":460,"width":785,"height":11}},{"id":"bd8ae059-8276-4135-916b-c0c50faff3a2","block_type":"box","text":"decision or strategy on behalf of another account ahead of, or contemporaneously with, similar decisions or","page_number":134,"box":{"x":69,"y":475,"width":767,"height":12}},{"id":"e355f02c-7987-4ba5-a495-7b5f659361ed","block_type":"box","text":"strategies for a Fund, market impact, liquidity constraints, or other factors could result in the Fund receiving less","page_number":134,"box":{"x":69,"y":491,"width":802,"height":11}},{"id":"5eb3e603-d6f3-4f74-a8bb-3a38527ebd17","block_type":"box","text":"favorable trading results and the costs of implementing such decisions or strategies could be increased or the Fund","page_number":134,"box":{"x":68,"y":506,"width":827,"height":11}},{"id":"8152654b-238c-4820-9473-11e9f292f355","block_type":"box","text":"could otherwise be disadvantaged. BlackRock may, in cer tain cases, elect to implement internal policies and","page_number":134,"box":{"x":69,"y":521,"width":776,"height":11}},{"id":"f7aa8a5a-4520-4eca-9eaa-dab5464353c7","block_type":"box","text":"procedures designed to limit such consequences, which may cause a Fund to be unable to engage in cer tain","page_number":134,"box":{"x":70,"y":536,"width":774,"height":11}},{"id":"2fc653e2-e1b2-4a9d-806e-dcde17040eb5","block_type":"box","text":"activities, including purchasing or disposing of securities, when it might otherwise be desirable for it to do so.","page_number":134,"box":{"x":69,"y":551,"width":781,"height":11}},{"id":"541a5f99-d670-419e-a0dd-edf6e83b986b","block_type":"box","text":"Conflicts may also arise because por tfolio decisions regarding a Fund may benefit other accounts managed by","page_number":134,"box":{"x":69,"y":566,"width":787,"height":11}},{"id":"bd75a80c-16e1-4b1a-ab65-ef3d30771133","block_type":"box","text":"BlackRock. For example, the sale of a long position or establishment of a shor t position by a Fund may impair the","page_number":134,"box":{"x":70,"y":581,"width":809,"height":12}},{"id":"8a1d58ce-a006-4f75-87fb-3b03a4528f6b","block_type":"box","text":"price of the same security sold shor t by (and therefore benefit) BlackRock or its other accounts or funds, and the","page_number":134,"box":{"x":70,"y":596,"width":805,"height":12}},{"id":"4095f0a8-78d7-4c26-b69a-628194cde94a","block_type":"box","text":"purchase of a security or covering of a shor t position in a security by a Fund may increase the price of the same","page_number":134,"box":{"x":70,"y":612,"width":797,"height":11}},{"id":"3b6e513b-7eef-4d8b-9954-1bb342c7a07f","block_type":"box","text":"security held by (and therefore benefit) BlackRock or its other accounts or funds.","page_number":134,"box":{"x":69,"y":627,"width":573,"height":11}},{"id":"fa725efd-877a-4a13-a97c-c7290220dff2","block_type":"box","text":"BlackRock, on behalf of other client accounts, on the one hand, and a Fund, on the other hand, may invest in or","page_number":134,"box":{"x":102,"y":649,"width":797,"height":12}},{"id":"02f03a95-e61a-4d39-8d7d-9c6fa071e1e8","block_type":"box","text":"extend credit to different par ts of the capital structure of a single issuer. BlackRock may pursue rights, provide","page_number":134,"box":{"x":69,"y":664,"width":791,"height":12}},{"id":"57631635-2c10-4ecb-80fb-9ed249525e8c","block_type":"box","text":"advice or engage in other activities, or refrain from pursuing rights, providing advice or engaging in other activities, on","page_number":134,"box":{"x":69,"y":680,"width":835,"height":11}},{"id":"fe2b4986-d142-42d7-93e1-3e70439ad792","block_type":"box","text":"behalf of other clients with respect to an issuer in which a Fund has invested, and such actions (or refraining from","page_number":134,"box":{"x":69,"y":695,"width":812,"height":11}},{"id":"8d25e688-ecc3-4e0f-9487-22891c4bc9bd","block_type":"box","text":"action) may have a material adverse effect on the Fund. In situations in which clients of BlackRock (including the","page_number":134,"box":{"x":69,"y":710,"width":803,"height":11}},{"id":"f132ccde-7f96-4224-95c5-028d3ed2f24c","block_type":"box","text":"Funds) hold positions in multiple par ts of the capital structure of an issuer, BlackRock may not pursue cer tain","page_number":134,"box":{"x":70,"y":725,"width":783,"height":11}},{"id":"2a610f8d-0bd7-4d81-bf8f-de7f7b6d721d","block_type":"box","text":"actions or remedies that may be available to a Fund, as a result of legal and regulatory requirements or otherwise.","page_number":134,"box":{"x":69,"y":740,"width":818,"height":11}},{"id":"ffd35493-8370-4a90-8339-9cf38dd66382","block_type":"box","text":"BlackRock addresses these and other potential conflicts of interest based on the facts and circumstances of","page_number":134,"box":{"x":70,"y":755,"width":777,"height":11}},{"id":"8000a521-f1fa-4cdb-bbf7-43399445f4b1","block_type":"box","text":"par ticular situations. For example, BlackRock may determine to rely on information barriers between different","page_number":134,"box":{"x":70,"y":770,"width":780,"height":11}},{"id":"e777e449-1a5b-4e57-8df9-1f443b3d5675","block_type":"box","text":"business units or por tfolio management teams. BlackRock may also determine to rely on the actions of similarly","page_number":134,"box":{"x":69,"y":785,"width":802,"height":12}},{"id":"c0d38eec-6b02-4012-a671-2dde654931ba","block_type":"box","text":"situated holders of loans or securities rather than, or in connection with, taking such actions itself on behalf of the","page_number":134,"box":{"x":69,"y":801,"width":817,"height":11}},{"id":"52333c3c-bc05-4451-9670-342b2ba97f24","block_type":"box","text":"Funds.","page_number":134,"box":{"x":70,"y":816,"width":44,"height":9}},{"id":"141c2e39-de49-4a39-aad3-848e0b30bba0","block_type":"box","text":"In addition, to the extent permitted by applicable law, cer tain Funds may invest their assets in other funds","page_number":134,"box":{"x":102,"y":838,"width":755,"height":11}},{"id":"072cb102-51f5-4560-8793-6bdb0f341cbf","block_type":"box","text":"advised by BlackRock, including funds that are managed by one or more of the same por tfolio managers, which could","page_number":134,"box":{"x":69,"y":853,"width":836,"height":12}},{"id":"325ac4be-e1c4-43bb-b3c4-48bb6916239f","block_type":"box","text":"result in conflicts of interest relating to asset allocation, timing of Fund purchases and redemptions, and increased","page_number":134,"box":{"x":69,"y":869,"width":821,"height":11}},{"id":"db14c108-17e5-4ea7-89f7-240b4be8ae81","block_type":"box","text":"remuneration and profitability for BlackRock and/or its personnel, including por tfolio managers.","page_number":134,"box":{"x":69,"y":884,"width":679,"height":11}},{"id":"09eae544-2d6e-45df-8551-1887e6204d36","block_type":"box","text":"II-90","page_number":134,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"09ce7364-8b1c-4bf0-ad92-92c3d1f7223e","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":134,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"a90733f9-6e1e-4895-8abe-55e5c7e7dffa","block_type":"box","text":"Third par ties, including service providers to BlackRock or the Fund, may sponsor events (including, but not","page_number":135,"box":{"x":101,"y":45,"width":760,"height":11}},{"id":"3bb2b81c-5a13-4fe3-b988-b1cbda27f805","block_type":"box","text":"limited to, marketing and promotional activities and presentations, educational training programs and conferences)","page_number":135,"box":{"x":70,"y":60,"width":818,"height":11}},{"id":"c9c2089d-80bd-4306-9dc3-38f4427111aa","block_type":"box","text":"for registered representatives, other professionals and individual investors. There is a potential conflict of interest as","page_number":135,"box":{"x":68,"y":75,"width":836,"height":11}},{"id":"0ad50b0f-9df5-4015-9675-d49efbf9a84c","block_type":"box","text":"such sponsorships may defray the costs of such activities to BlackRock, and may provide an incentive to BlackRock","page_number":135,"box":{"x":69,"y":90,"width":825,"height":11}},{"id":"626c7d80-4ecd-4054-a595-7e819c9357fd","block_type":"box","text":"to retain such third par ties to provide services to the Fund.","page_number":135,"box":{"x":68,"y":105,"width":421,"height":11}},{"id":"c0bea8c8-5e9c-4c83-805c-0a170cf2395c","block_type":"box","text":"In cer tain circumstances, BlackRock, on behalf of the Funds, may seek to buy from or sell securities to another","page_number":135,"box":{"x":102,"y":128,"width":794,"height":11}},{"id":"f94b150f-8f20-408e-8185-24ff63d96a55","block_type":"box","text":"fund or account advised by BlackRock. BlackRock may (but is not required to) effect purchases and sales between","page_number":135,"box":{"x":68,"y":143,"width":817,"height":11}},{"id":"ab4b51da-3c46-4a28-b058-47a7b921a55b","block_type":"box","text":"BlackRock clients (“cross trades”), including the Funds, if BlackRock believes such transactions are appropriate","page_number":135,"box":{"x":70,"y":158,"width":797,"height":11}},{"id":"ea68e6bb-0456-4ae8-ba4b-e84a9c7df038","block_type":"box","text":"based on each par ty’s investment objectives and guidelines, subject to applicable law and regulation. There may be","page_number":135,"box":{"x":69,"y":173,"width":826,"height":11}},{"id":"29cb9846-37c4-454f-92fc-8a214b51f734","block_type":"box","text":"potential conflicts of interest or regulatory issues relating to these transactions which could limit BlackRock’s","page_number":135,"box":{"x":70,"y":188,"width":780,"height":12}},{"id":"1ab21f2c-6847-4166-be6b-b65fd3e461bd","block_type":"box","text":"decision to engage in these transactions for the Funds. BlackRock may have a potentially conflicting division of","page_number":135,"box":{"x":69,"y":203,"width":791,"height":12}},{"id":"eb12473a-42b0-425b-9255-591e3d630263","block_type":"box","text":"loyalties and responsibilities to the par ties in such transactions.","page_number":135,"box":{"x":70,"y":219,"width":457,"height":11}},{"id":"ddbe40fc-6d66-4176-ac1b-90419284ddee","block_type":"box","text":"BlackRock and its clients may pursue or enforce rights with respect to an issuer in which a Fund has invested,","page_number":135,"box":{"x":102,"y":241,"width":784,"height":11}},{"id":"bf136bf9-3551-43bd-8854-d256b334947b","block_type":"box","text":"and those activities may have an adverse effect on the Fund. As a result, prices, availability, liquidity and terms of the","page_number":135,"box":{"x":69,"y":256,"width":840,"height":11}},{"id":"b31af929-62a8-448f-bb22-e42d0291e833","block_type":"box","text":"Fund’s investments may be negatively impacted by the activities of BlackRock or its clients, and transactions for the","page_number":135,"box":{"x":70,"y":271,"width":827,"height":12}},{"id":"dbb12637-b3f2-460c-9964-0a3cce0855b6","block_type":"box","text":"Fund may be impaired or effected at prices or terms that may be less favorable than would otherwise have been the","page_number":135,"box":{"x":70,"y":286,"width":828,"height":12}},{"id":"8bd07c10-55b0-4fbe-a1ff-01b2100b070e","block_type":"box","text":"case.","page_number":135,"box":{"x":69,"y":304,"width":37,"height":7}},{"id":"830390e7-6446-45b2-aa7b-1df5dad10932","block_type":"box","text":"The results of a Fund’s investment activities may differ significantly from the results achieved by BlackRock for","page_number":135,"box":{"x":101,"y":324,"width":791,"height":12}},{"id":"3f76e43a-10f6-42e3-b9af-a8326bd5c1e0","block_type":"box","text":"its proprietary accounts or other accounts (including investment companies or collective investment vehicles) that it","page_number":135,"box":{"x":70,"y":340,"width":824,"height":11}},{"id":"3916531c-4c7d-4246-bb12-3e0210f9551a","block_type":"box","text":"manages or advises. It is possible that one or more accounts managed or advised by BlackRock and such other","page_number":135,"box":{"x":69,"y":355,"width":798,"height":11}},{"id":"475aab7b-28bb-4e2e-8edd-d9141c1c0962","block_type":"box","text":"accounts will achieve investment results that are substantially more or less favorable than the results achieved by a","page_number":135,"box":{"x":69,"y":370,"width":828,"height":11}},{"id":"1ab9323a-2b60-4fb9-b410-09b5bdf8dfc5","block_type":"box","text":"Fund. Moreover, it is possible that a Fund will sustain losses during periods in which one or more proprietary or other","page_number":135,"box":{"x":70,"y":385,"width":835,"height":11}},{"id":"9c115409-f3a8-4796-98c6-19e55ff8c7c5","block_type":"box","text":"accounts managed or advised by BlackRock achieve significant profits. The opposite result is also possible.","page_number":135,"box":{"x":69,"y":400,"width":767,"height":11}},{"id":"9f5ed0b4-3208-41fe-9826-9a399fc1eb7d","block_type":"box","text":"From time to time, a Fund may be restricted from purchasing or selling securities, or from engaging in other","page_number":135,"box":{"x":102,"y":423,"width":766,"height":11}},{"id":"055c83bc-26ba-44e1-89cb-8a535985d9cd","block_type":"box","text":"investment activities because of regulatory, legal or contractual requirements applicable to BlackRock or other","page_number":135,"box":{"x":70,"y":438,"width":786,"height":11}},{"id":"36e354ec-3d6f-41fd-ab05-69e2ed3d6033","block_type":"box","text":"accounts managed or advised by BlackRock, and/or the internal policies of BlackRock designed to comply with such","page_number":135,"box":{"x":69,"y":453,"width":828,"height":11}},{"id":"df24e45f-f0ba-461c-9ab4-7a838ec549a0","block_type":"box","text":"requirements. As a result, there may be periods, for example, when BlackRock will not initiate or recommend cer tain","page_number":135,"box":{"x":69,"y":468,"width":831,"height":11}},{"id":"fab4e286-8591-4f2b-ad4e-16c4854aac86","block_type":"box","text":"types of transactions in cer tain securities or instruments with respect to which BlackRock is per forming services or","page_number":135,"box":{"x":68,"y":483,"width":825,"height":11}},{"id":"2f0bbed3-bbbe-455c-ac95-081dae8257a7","block_type":"box","text":"when position limits have been reached. 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BlackRock will not be under any obligation, however, to effect","page_number":135,"box":{"x":70,"y":581,"width":826,"height":12}},{"id":"f001cdc7-acd5-4bdd-8b08-7102cae7926a","block_type":"box","text":"transactions on behalf of a Fund in accordance with such analysis and models. In addition, BlackRock will not have","page_number":135,"box":{"x":68,"y":596,"width":821,"height":12}},{"id":"6fdd5121-5ba5-43d7-937b-0982a7c9404f","block_type":"box","text":"any obligation to make available any information regarding its proprietary activities or strategies, or the activities or","page_number":135,"box":{"x":69,"y":612,"width":821,"height":11}},{"id":"25372923-d8a7-42bf-b11f-8be5f862215d","block_type":"box","text":"strategies used for other accounts managed by them, for the benefit of the management of a Fund and it is not","page_number":135,"box":{"x":69,"y":627,"width":793,"height":11}},{"id":"dfac5161-19ea-4de0-9648-7c6fa6acb5ae","block_type":"box","text":"anticipated that BlackRock will have access to such information for the purpose of managing the Fund. The","page_number":135,"box":{"x":69,"y":642,"width":762,"height":11}},{"id":"b09f42ad-f25f-4833-895b-bd2b2d43daed","block_type":"box","text":"proprietary activities or por tfolio strategies of BlackRock, or the activities or strategies used for accounts managed by","page_number":135,"box":{"x":70,"y":657,"width":839,"height":11}},{"id":"48839361-f455-4e8f-84f8-97e5ea6a6060","block_type":"box","text":"BlackRock or other client accounts could conflict with the transactions and strategies employed by BlackRock in","page_number":135,"box":{"x":70,"y":672,"width":795,"height":11}},{"id":"7c32bbb4-8537-4e21-a424-94465c97a0f2","block_type":"box","text":"managing a Fund.","page_number":135,"box":{"x":69,"y":687,"width":124,"height":11}},{"id":"f6191a93-04a0-431d-bfdb-65d8dbbd2ce8","block_type":"box","text":"The Funds may be included in investment models developed by BlackRock for use by clients and financial","page_number":135,"box":{"x":101,"y":710,"width":751,"height":11}},{"id":"e9b35db2-d7b7-4b71-b21e-afdcd7635d22","block_type":"box","text":"advisors. To the extent clients invest in these investment models and increase the assets under management of the","page_number":135,"box":{"x":69,"y":725,"width":830,"height":11}},{"id":"2b51ce7d-cac3-4f7e-a1f8-25fbb4d047a5","block_type":"box","text":"Funds, the investment management fee amounts paid by the Funds to BlackRock may also increase. The net asset","page_number":135,"box":{"x":70,"y":740,"width":820,"height":11}},{"id":"ec9d31d3-a591-4616-8bc5-20a0fd54b1a2","block_type":"box","text":"value and liquidity of a Fund may be impacted by purchases and sales of the Fund by model-driven investment","page_number":135,"box":{"x":68,"y":755,"width":785,"height":11}},{"id":"c43a8259-0362-41e3-942b-97567ff5027a","block_type":"box","text":"por tfolios, as well as by BlackRock itself and by its advisory clients.","page_number":135,"box":{"x":70,"y":770,"width":481,"height":11}},{"id":"f2286c5e-5333-48ae-9b7b-25954923ed18","block_type":"box","text":"In addition, cer tain principals and cer tain employees of a Fund’s investment adviser are also principals or","page_number":135,"box":{"x":102,"y":793,"width":754,"height":11}},{"id":"39bcb1dd-ef57-48e0-917c-44f13fa1d958","block_type":"box","text":"employees of other business units or entities within BlackRock. As a result, these principals and employees may","page_number":135,"box":{"x":69,"y":808,"width":804,"height":11}},{"id":"2346c4a2-1909-4c97-a7af-244550ff154f","block_type":"box","text":"have obligations to such other business units or entities or their clients and such obligations to other business units","page_number":135,"box":{"x":69,"y":823,"width":831,"height":12}},{"id":"3a490609-d84a-47ae-a07a-766c8add48d9","block_type":"box","text":"or entities or their clients may be a consideration of which investors in a Fund should be aware.","page_number":135,"box":{"x":69,"y":838,"width":680,"height":11}},{"id":"5a30693e-5bef-4411-b4a0-64c721162794","block_type":"box","text":"BlackRock may enter into transactions and invest in securities, instruments and currencies on behalf of a Fund","page_number":135,"box":{"x":102,"y":861,"width":791,"height":11}},{"id":"e658acc0-96c4-4486-a753-d6863b52eaaf","block_type":"box","text":"in which clients of BlackRock, or, to the extent permitted by the Commission and applicable law, BlackRock, serves","page_number":135,"box":{"x":70,"y":876,"width":820,"height":11}},{"id":"8239f9a8-38bc-4b9f-85bd-d27ab3c4e2a5","block_type":"box","text":"as the counterpar ty, principal or issuer. In such cases, such par ty’s interests in the transaction will be adverse to the","page_number":135,"box":{"x":69,"y":891,"width":837,"height":11}},{"id":"32f6c63a-06b3-49af-8116-5db41ec55c2f","block_type":"box","text":"interests of the Fund, and such par ty may have no incentive to assure that the Fund obtains the best possible prices","page_number":135,"box":{"x":70,"y":906,"width":832,"height":12}},{"id":"2c76eb4f-a29e-4c36-b9ae-8b2422ac4284","block_type":"box","text":"II-91","page_number":135,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"602fce9a-33e4-4661-bc24-5a67135b8ff6","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":135,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"67f2b154-d74a-41e2-8b07-a5c492a2dfbc","block_type":"box","text":"or terms in connection with the transactions. In addition, the purchase, holding and sale of such investments by a","page_number":136,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"64f3646e-6bb8-407b-8236-534fbdfffd01","block_type":"box","text":"Fund may enhance the profitability of BlackRock.","page_number":136,"box":{"x":70,"y":60,"width":344,"height":11}},{"id":"f91f3c53-d15d-4cfa-aacd-40f396bce696","block_type":"box","text":"BlackRock may also create, write or issue derivatives for clients, the underlying securities, currencies or","page_number":136,"box":{"x":102,"y":82,"width":741,"height":12}},{"id":"b46dd54a-6edb-450c-9b20-28a36a29692c","block_type":"box","text":"instruments of which may be those in which a Fund invests or which may be based on the per formance of the Fund.","page_number":136,"box":{"x":70,"y":98,"width":824,"height":11}},{"id":"92f4f543-f087-4d2e-8711-e67787d880b8","block_type":"box","text":"Additionally, an affiliate of BlackRock will create, write or issue options, which may be based on the per formance of","page_number":136,"box":{"x":68,"y":113,"width":825,"height":11}},{"id":"5f865d6b-3190-4900-a8b8-9d3b1b2928fb","block_type":"box","text":"cer tain Funds. BlackRock has entered into an arrangement with Markit Indices Limited, the index provider for","page_number":136,"box":{"x":69,"y":128,"width":777,"height":11}},{"id":"7d0f3393-73a1-4f1f-8ef2-2f63fee49c23","block_type":"box","text":"underlying fixed-income indexes used by cer tain iShares ETFs, related to derivative fixed-income products that are","page_number":136,"box":{"x":69,"y":143,"width":810,"height":11}},{"id":"f06a2803-0369-4b71-bb25-07c39fdebb24","block_type":"box","text":"based on such iShares ETFs. Trading activity in these derivative products could also potentially lead to greater","page_number":136,"box":{"x":69,"y":158,"width":784,"height":11}},{"id":"8030e01d-f28d-47c6-985b-34c486c2770e","block_type":"box","text":"liquidity for such products, increased purchase activity with respect to these iShares ETFs and increased assets","page_number":136,"box":{"x":70,"y":173,"width":798,"height":11}},{"id":"3dca4232-a1ee-401d-b51f-ab31ff7711e2","block_type":"box","text":"under management for BlackRock.","page_number":136,"box":{"x":69,"y":188,"width":243,"height":12}},{"id":"13ef79cb-4252-4097-bda9-03b119e93caf","block_type":"box","text":"A Fund may, subject to applicable law, purchase investments that are the subject of an underwriting or other","page_number":136,"box":{"x":101,"y":211,"width":773,"height":11}},{"id":"1c58b12d-aa32-4044-bc7d-dcc3d1f8f06d","block_type":"box","text":"distribution by BlackRock and may also enter into transactions with other clients of BlackRock where such other","page_number":136,"box":{"x":69,"y":226,"width":797,"height":11}},{"id":"77da1281-75e7-46b2-95c6-b33aaf631093","block_type":"box","text":"clients have interests adverse to those of the Fund. At times, these activities may cause business units or entities","page_number":136,"box":{"x":69,"y":241,"width":817,"height":11}},{"id":"1ea11a0c-bcc2-42b9-97f3-2114313d6128","block_type":"box","text":"within BlackRock to give advice to clients that may cause these clients to take actions adverse to the interests of the","page_number":136,"box":{"x":68,"y":256,"width":837,"height":12}},{"id":"e3b1022a-408c-490f-80ec-780b95f6e298","block_type":"box","text":"Fund. To the extent such transactions are permitted, a Fund will deal with BlackRock on an arms-length basis.","page_number":136,"box":{"x":70,"y":272,"width":781,"height":11}},{"id":"fb3a28bd-a8e4-4ef2-81c0-88f062166e6d","block_type":"box","text":"To the extent authorized by applicable law, BlackRock may act as broker, dealer, agent, lender or adviser or in","page_number":136,"box":{"x":101,"y":294,"width":779,"height":11}},{"id":"aec739e6-1329-4dec-a07b-242c9e9f2ecf","block_type":"box","text":"other commercial capacities for a Fund. It is anticipated that the commissions, mark-ups, mark-downs, financial","page_number":136,"box":{"x":69,"y":309,"width":795,"height":11}},{"id":"e260b330-ab15-4ce7-95a7-176f090502cb","block_type":"box","text":"advisory fees, underwriting and placement fees, sales fees, financing and commitment fees, brokerage fees, other","page_number":136,"box":{"x":69,"y":324,"width":821,"height":12}},{"id":"07687338-4971-4999-a65d-4470364af85b","block_type":"box","text":"fees, compensation or profits, rates, terms and conditions charged by BlackRock will be in its view commercially","page_number":136,"box":{"x":68,"y":339,"width":802,"height":12}},{"id":"404c6170-aed5-42e8-903b-cfb8d0b3a27e","block_type":"box","text":"reasonable, although BlackRock, including its sales personnel, will have an interest in obtaining fees and other","page_number":136,"box":{"x":69,"y":355,"width":792,"height":11}},{"id":"b06b377f-8ce6-4b6d-9634-bee2a7c2be33","block_type":"box","text":"amounts that are favorable to BlackRock and such sales personnel, which may have an adverse effect on the Funds.","page_number":136,"box":{"x":69,"y":370,"width":832,"height":11}},{"id":"b5a31364-f3cb-4612-b508-7a152a245136","block_type":"box","text":"Index based funds may use an index provider that is affiliated with another service provider of the Fund or BlackRock","page_number":136,"box":{"x":70,"y":385,"width":833,"height":11}},{"id":"825731ac-6c71-42f2-851e-12b6a4eb95b2","block_type":"box","text":"that acts as a broker, dealer, agent, lender or in other commercial capacities for a Fund or BlackRock.","page_number":136,"box":{"x":68,"y":400,"width":726,"height":11}},{"id":"84bfa5e4-223b-4d08-aefd-1cc3d0340f33","block_type":"box","text":"Subject to applicable law, BlackRock (and its personnel and other distributors) will be entitled to retain fees and","page_number":136,"box":{"x":102,"y":423,"width":796,"height":11}},{"id":"a2666f2c-503b-4542-af2e-9bc64339ea77","block_type":"box","text":"other amounts that they receive in connection with their service to the Funds as broker, dealer, agent, lender, adviser","page_number":136,"box":{"x":69,"y":438,"width":837,"height":11}},{"id":"fe10a092-367a-4726-9abc-a3a12694137d","block_type":"box","text":"or in other commercial capacities. 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BlackRock will not have any obligation to allow its credit to be used in connection with a Fund’s","page_number":136,"box":{"x":69,"y":559,"width":793,"height":11}},{"id":"c14c1731-2d22-4d2f-a11d-d0b2e6bb630e","block_type":"box","text":"establishment of its business relationships, nor is it expected that the Fund’s counterpar ties will rely on the credit of","page_number":136,"box":{"x":69,"y":574,"width":835,"height":11}},{"id":"070c949e-f65e-4e08-af0c-deb03395ef1b","block_type":"box","text":"BlackRock in evaluating the Fund’s creditwor thiness.","page_number":136,"box":{"x":70,"y":589,"width":374,"height":11}},{"id":"641986ce-aee8-49af-bb2e-e2e4f5747aa6","block_type":"box","text":"BlackRock Investment Management, LLC (“BIM”) or BlackRock Institutional Trust Company, N.A. (“BTC”), as","page_number":136,"box":{"x":102,"y":612,"width":768,"height":11}},{"id":"4b17e6d2-44ba-42b9-9320-80d7fa83efba","block_type":"box","text":"applicable, each an affiliate of BlackRock, pursuant to SEC exemptive relief, acts as securities lending agent to, and","page_number":136,"box":{"x":69,"y":627,"width":829,"height":11}},{"id":"25891eac-426e-445b-8b50-f8da69b61d0c","block_type":"box","text":"receives a share of securities lending revenues from, the Funds. BlackRock will also receive compensation for","page_number":136,"box":{"x":69,"y":642,"width":785,"height":11}},{"id":"6b2c087f-b6a6-4ba2-83ee-c6655d876b98","block_type":"box","text":"managing the reinvestment of the cash collateral from securities lending. There are potential conflicts of interests in","page_number":136,"box":{"x":69,"y":657,"width":829,"height":11}},{"id":"4f55aa16-9e66-4727-90cd-94d4ab6fe377","block_type":"box","text":"managing a securities lending program, including but not limited to: (i) BlackRock as securities lending agent may","page_number":136,"box":{"x":69,"y":672,"width":809,"height":11}},{"id":"057242c0-eaea-49ef-a32e-c9b119a1de86","block_type":"box","text":"have an incentive to, among other things, increase or decrease the amount of securities on loan or to lend par ticular","page_number":136,"box":{"x":69,"y":687,"width":833,"height":11}},{"id":"3ca00c8b-af37-408a-a9c9-5b4d64a73733","block_type":"box","text":"securities in order to generate additional risk-adjusted revenue for BlackRock and its affiliates; and (ii) BlackRock as","page_number":136,"box":{"x":69,"y":702,"width":829,"height":12}},{"id":"90998849-3f76-4471-b911-039ec4e0fc8a","block_type":"box","text":"securities lending agent may have an incentive to allocate loans to clients that would provide more revenue to","page_number":136,"box":{"x":69,"y":718,"width":783,"height":11}},{"id":"7c92a228-e84b-499f-a4b0-48abaeabf551","block_type":"box","text":"BlackRock. As described fur ther below, BlackRock seeks to mitigate this conflict by providing its securities lending","page_number":136,"box":{"x":70,"y":732,"width":814,"height":12}},{"id":"ac5a24a2-4e38-4bed-911b-f71e26dd8f09","block_type":"box","text":"clients with equal lending oppor tunities over time in order to approximate pro rata allocation.","page_number":136,"box":{"x":69,"y":748,"width":660,"height":11}},{"id":"efae725a-e9c3-490e-a544-064252d640e7","block_type":"box","text":"As par t of its securities lending program, BlackRock indemnifies the Funds and cer tain other clients and/or","page_number":136,"box":{"x":101,"y":770,"width":767,"height":12}},{"id":"65a3c776-1be3-4214-8a44-eaf57770449d","block_type":"box","text":"funds against a shor tfall in collateral in the event of borrower default. On a regular basis, BlackRock calculates the","page_number":136,"box":{"x":68,"y":785,"width":820,"height":12}},{"id":"555df510-854a-4f68-842e-fb742f1624af","block_type":"box","text":"potential dollar exposure of collateral shor tfall resulting from a borrower default (“shor tfall risk”) in the securities","page_number":136,"box":{"x":70,"y":801,"width":806,"height":11}},{"id":"a969ac2a-363c-4329-95e6-c9f116ce2aff","block_type":"box","text":"lending program. BlackRock establishes program-wide borrower limits (“credit limits”) to actively manage borrower","page_number":136,"box":{"x":70,"y":816,"width":816,"height":11}},{"id":"6ab246f7-898d-48ee-9f2b-1f07223fa5d6","block_type":"box","text":"specific credit exposure. BlackRock oversees the risk model that calculates projected collateral shor tfall values using","page_number":136,"box":{"x":69,"y":831,"width":838,"height":11}},{"id":"1c0cce8d-c7a3-4275-a09c-9a9a5f423560","block_type":"box","text":"loan-level factors such as loan and collateral type and market value as well as specific borrower credit","page_number":136,"box":{"x":70,"y":846,"width":727,"height":11}},{"id":"699cfcdd-01b9-405b-a187-df0465295606","block_type":"box","text":"characteristics. When necessary, BlackRock may adjust securities lending program attributes by restricting eligible","page_number":136,"box":{"x":69,"y":861,"width":815,"height":11}},{"id":"6a25401c-cac3-49bf-8e80-c3fb349d0b3c","block_type":"box","text":"collateral or reducing borrower credit limits. As a result, the management of program-wide exposure as well as","page_number":136,"box":{"x":69,"y":876,"width":786,"height":11}},{"id":"e78360e4-9808-4905-8cb2-ede80eb66d92","block_type":"box","text":"BlackRock-specific indemnification exposure may affect the amount of securities lending activity BlackRock may","page_number":136,"box":{"x":70,"y":891,"width":796,"height":12}},{"id":"a0e7ab18-c4b3-496d-9aea-2acbad04a190","block_type":"box","text":"II-92","page_number":136,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"4206b66c-ea70-4a6d-a6f2-2b0b55e46a50","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":136,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"486b5ec5-4130-40b0-9c4f-61c5e803284e","block_type":"box","text":"conduct at any given point in time by reducing the volume of lending oppor tunities for cer tain loans (including by","page_number":137,"box":{"x":69,"y":45,"width":799,"height":11}},{"id":"dc43ca54-266f-4a7a-ad15-0e8b42d98844","block_type":"box","text":"asset type, collateral type and/or revenue profile).","page_number":137,"box":{"x":69,"y":60,"width":356,"height":11}},{"id":"dda5e07e-7b65-4e24-b727-bda79b7929f2","block_type":"box","text":"BlackRock may decline to make a securities loan on behalf of a Fund, discontinue lending on behalf of a Fund or","page_number":137,"box":{"x":102,"y":82,"width":801,"height":12}},{"id":"e138070c-c7e5-4564-a841-70279db1d166","block_type":"box","text":"terminate a securities loan on behalf of a Fund for any reason, including but not limited to regulatory requirements","page_number":137,"box":{"x":68,"y":98,"width":817,"height":11}},{"id":"dde20feb-e5b9-4f7d-ac2e-5c48bfa1d01b","block_type":"box","text":"and/or market rules, liquidity considerations, or credit considerations, which may impact Funds by reducing or","page_number":137,"box":{"x":69,"y":113,"width":784,"height":11}},{"id":"2fe3dabd-6efb-4ab9-b567-71982ab2d54e","block_type":"box","text":"eliminating the volume of lending oppor tunities for cer tain types of loans, loans in par ticular markets, loans of","page_number":137,"box":{"x":69,"y":128,"width":789,"height":11}},{"id":"be2e6b02-564c-422f-b4b6-cd88b8321714","block_type":"box","text":"par ticular securities or types of securities, or for loans overall. In addition, some borrowers may prefer cer tain","page_number":137,"box":{"x":70,"y":143,"width":783,"height":11}},{"id":"221d9e9e-77dc-4277-8e1c-e2e20f94f45a","block_type":"box","text":"BlackRock lenders that provide additional protections against lender default that are favored by their prudential","page_number":137,"box":{"x":70,"y":158,"width":790,"height":11}},{"id":"f0484a5a-f97f-4415-bf10-d9e64c0d1d5e","block_type":"box","text":"regulation.","page_number":137,"box":{"x":69,"y":173,"width":73,"height":11}},{"id":"7ff9d348-5128-4b72-870e-dc77749b48b1","block_type":"box","text":"BlackRock uses a predetermined systematic process in order to approximate pro rata allocation over time. In","page_number":137,"box":{"x":102,"y":196,"width":777,"height":11}},{"id":"8a551d06-6513-4c83-ab0f-d1eb6d601e97","block_type":"box","text":"order to allocate a loan to a por tfolio: (i) BlackRock as a whole must have sufficient lending capacity pursuant to the","page_number":137,"box":{"x":69,"y":211,"width":830,"height":11}},{"id":"3f3f312e-bac2-4f51-96f6-c4833c8c98aa","block_type":"box","text":"various program limits (","page_number":137,"box":{"x":68,"y":226,"width":168,"height":11}},{"id":"0c2428f9-1ee5-4cfb-80fa-c26b7b13e80e","block_type":"box","text":"i.e.","page_number":137,"box":{"x":238,"y":226,"width":20,"height":9}},{"id":"a42fe0a5-6400-49e4-8112-83c234c30319","block_type":"box","text":"indemnification exposure limit and borrower credit limits); (ii) the lending por tfolio must","page_number":137,"box":{"x":265,"y":226,"width":621,"height":11}},{"id":"974deaa7-9468-40c5-9697-9fc17da2b9fb","block_type":"box","text":"hold the asset at the time a loan oppor tunity arrives; and (iii) the lending por tfolio must also have enough inventory,","page_number":137,"box":{"x":69,"y":241,"width":827,"height":11}},{"id":"8c2816dc-4eee-4f9d-8f69-47bd2bb0ff6e","block_type":"box","text":"either on its own or when aggregated with other por tfolios into one single market delivery, to satisfy the loan request.","page_number":137,"box":{"x":69,"y":256,"width":836,"height":12}},{"id":"a87bf40c-29c6-4bd8-b6fc-8b60e2a1daa1","block_type":"box","text":"In doing so, BlackRock seeks to provide equal lending oppor tunities for all por tfolios, independent of whether","page_number":137,"box":{"x":70,"y":271,"width":780,"height":12}},{"id":"962e2346-57fc-4722-9562-14844a65254a","block_type":"box","text":"BlackRock indemnifies the por tfolio. Equal oppor tunities for lending por tfolios does not guarantee equal outcomes.","page_number":137,"box":{"x":70,"y":286,"width":820,"height":12}},{"id":"522901b1-133f-4ca4-ba6d-d5b34e41c3f0","block_type":"box","text":"Specifically, shor t and long-term outcomes for individual clients may vary due to asset mix, asset/liability spreads on","page_number":137,"box":{"x":69,"y":302,"width":834,"height":11}},{"id":"bf8fddb8-2c72-4213-9cba-bcff50dd81a2","block_type":"box","text":"different securities, and the overall limits imposed by the firm.","page_number":137,"box":{"x":69,"y":317,"width":444,"height":11}},{"id":"8a484836-26d4-4df5-91c2-aee13b25a83b","block_type":"box","text":"Purchases and sales of securities and other assets for a Fund may be aggregated with orders for other","page_number":137,"box":{"x":102,"y":339,"width":734,"height":12}},{"id":"bf7c9351-56bc-4ce3-8978-515ec6b24fef","block_type":"box","text":"BlackRock client accounts, including with accounts that pay different transaction costs solely due to the fact that they","page_number":137,"box":{"x":70,"y":355,"width":840,"height":11}},{"id":"0ac1e812-00a8-4250-9381-883729a5b31e","block_type":"box","text":"have different research payment arrangements. BlackRock, however, is not required to aggregate orders if por tfolio","page_number":137,"box":{"x":69,"y":370,"width":822,"height":11}},{"id":"b0e60036-5d53-44e6-a8fb-a17a35198072","block_type":"box","text":"management decisions for different accounts are made separately, or if they determine that aggregating is not","page_number":137,"box":{"x":69,"y":385,"width":788,"height":11}},{"id":"73bf5621-265f-4ac1-b3da-46ca6eba08ff","block_type":"box","text":"practicable or required, or in cases involving client direction.","page_number":137,"box":{"x":70,"y":400,"width":426,"height":11}},{"id":"e35962af-fe12-4bd8-b12b-cb3e73e099a2","block_type":"box","text":"Prevailing trading activity frequently may make impossible the receipt of the same price or execution on the","page_number":137,"box":{"x":102,"y":423,"width":763,"height":11}},{"id":"b49aa0ee-3f92-47ff-bd5d-16e66d83d497","block_type":"box","text":"entire volume of securities purchased or sold. When this occurs, the various prices may be averaged, and the Funds","page_number":137,"box":{"x":69,"y":438,"width":828,"height":11}},{"id":"af1af778-9b14-4ecc-acd0-e75a72945008","block_type":"box","text":"will be charged or credited with the average price. Thus, the effect of the aggregation may operate on some","page_number":137,"box":{"x":68,"y":453,"width":767,"height":11}},{"id":"8dfbcb99-087d-41bd-a7b9-86772371d1fb","block_type":"box","text":"occasions to the disadvantage of the Funds. In addition, under cer tain circumstances, the Funds will not be charged","page_number":137,"box":{"x":69,"y":468,"width":828,"height":11}},{"id":"0cf3c93d-8b5f-4fe3-8fd8-fe6eef3fb24f","block_type":"box","text":"the same commission or commission equivalent rates in connection with an aggregated order.","page_number":137,"box":{"x":68,"y":483,"width":672,"height":11}},{"id":"97513ed5-f17b-4d72-a5c1-bbf270c1da25","block_type":"box","text":"As discussed in the section below entitled “Por tfolio Transactions and Brokerage—Transactions in Por tfolio","page_number":137,"box":{"x":101,"y":506,"width":767,"height":11}},{"id":"80404067-bace-45d7-8ce3-0faab2b2487a","block_type":"box","text":"Securities,” BlackRock, unless prohibited by applicable law, may cause a Fund or account to pay a broker or dealer a","page_number":137,"box":{"x":69,"y":521,"width":832,"height":11}},{"id":"48218bd1-ae26-43c7-8f09-837099a65c26","block_type":"box","text":"commission for effecting a transaction that exceeds the amount another broker or dealer would have charged for","page_number":137,"box":{"x":69,"y":536,"width":805,"height":11}},{"id":"62ebbc77-a9b5-484e-a357-b0aa60bf7e7c","block_type":"box","text":"effecting the same transaction in recognition of the value of brokerage and research services provided by that broker","page_number":137,"box":{"x":69,"y":551,"width":836,"height":11}},{"id":"2a9f71a6-6efe-42d6-9caf-b61fc2f81035","block_type":"box","text":"or dealer. Under MiFID II, EU investment managers, including BlackRock International Limited (“BIL”) which acts as a","page_number":137,"box":{"x":69,"y":566,"width":831,"height":11}},{"id":"af48c56a-5496-4cac-adfc-14349c556b42","block_type":"box","text":"sub-adviser to cer tain Funds, pay for research from brokers and dealers directly out of their own resources, rather","page_number":137,"box":{"x":69,"y":581,"width":812,"height":11}},{"id":"b70af074-679c-47ed-8310-e40a8dccb02a","block_type":"box","text":"than through client commissions.","page_number":137,"box":{"x":68,"y":597,"width":237,"height":11}},{"id":"c9cce639-ff19-44e1-be52-02ce3bf5e3de","block_type":"box","text":"Subject to applicable law, BlackRock may select brokers that furnish BlackRock, the Funds, other BlackRock","page_number":137,"box":{"x":102,"y":619,"width":770,"height":11}},{"id":"90cf1d92-d9f9-4009-8b8b-266a49c4e5f7","block_type":"box","text":"client accounts or personnel, directly or through correspondent relationships, with research or other appropriate","page_number":137,"box":{"x":69,"y":634,"width":797,"height":12}},{"id":"53f4ccc0-ca2b-4f48-9e66-88960a58d379","block_type":"box","text":"services which provide, in BlackRock’s view, appropriate assistance to BlackRock in the investment decision making","page_number":137,"box":{"x":69,"y":650,"width":830,"height":11}},{"id":"e0f997b8-4a82-4e2f-adc8-5f2fee65b4f7","block_type":"box","text":"process (including with respect to futures, fixed-price offerings and OTC transactions). Such research or other","page_number":137,"box":{"x":70,"y":664,"width":780,"height":12}},{"id":"02c4137e-f095-4dc3-995a-5201c97527e9","block_type":"box","text":"services may include, to the extent permitted by law, research repor ts on companies, industries and securities;","page_number":137,"box":{"x":69,"y":680,"width":795,"height":11}},{"id":"44a92245-ae77-4022-8009-c7f4a5d145b1","block_type":"box","text":"economic and financial data; financial publications; proxy analysis; trade industry seminars; computer data bases;","page_number":137,"box":{"x":69,"y":695,"width":815,"height":11}},{"id":"bb412266-4ab6-4d8e-be91-8550d306990c","block_type":"box","text":"research-oriented software and other services and products.","page_number":137,"box":{"x":69,"y":710,"width":430,"height":11}},{"id":"1db60140-e41f-49bf-b53f-f1c712cfb8a4","block_type":"box","text":"Research or other services obtained in this manner may be used in servicing any or all of the Funds and other","page_number":137,"box":{"x":102,"y":732,"width":785,"height":12}},{"id":"e3f1a1ad-dec6-4578-a0d5-5f0fa896423c","block_type":"box","text":"BlackRock client accounts, including in connection with BlackRock client accounts other than those that pay","page_number":137,"box":{"x":70,"y":748,"width":768,"height":11}},{"id":"ce9513fe-bb20-46a7-928e-4f65b0c8a985","block_type":"box","text":"commissions to the broker relating to the research or other service arrangements. Such products and services may","page_number":137,"box":{"x":69,"y":763,"width":826,"height":11}},{"id":"524c5d07-8d5b-4bde-9107-8bbc1b0a75ff","block_type":"box","text":"dispropor tionately benefit other BlackRock client accounts relative to the Funds based on the amount of brokerage","page_number":137,"box":{"x":69,"y":778,"width":818,"height":11}},{"id":"21e217ee-d434-41ed-8610-cb44023228cb","block_type":"box","text":"commissions paid by the Funds and such other BlackRock client accounts. For example, research or other services","page_number":137,"box":{"x":69,"y":793,"width":821,"height":11}},{"id":"a568c13e-c06b-4a4a-ae7f-45a10cd6bd54","block_type":"box","text":"that are paid for through one client’s commissions may not be used in managing that client’s account. In addition,","page_number":137,"box":{"x":68,"y":808,"width":815,"height":11}},{"id":"eaef59da-4384-42fb-99a0-8816f41f0ee7","block_type":"box","text":"other BlackRock client accounts may receive the benefit, including dispropor tionate benefits, of economies of scale","page_number":137,"box":{"x":69,"y":823,"width":824,"height":12}},{"id":"43c2f5ee-bc7e-40fd-b1ed-d621029ff98d","block_type":"box","text":"or price discounts in connection with products and services that may be provided to the Funds and to such other","page_number":137,"box":{"x":69,"y":839,"width":804,"height":10}},{"id":"c79dbe78-856a-4847-8f26-8c08d2a7ff5f","block_type":"box","text":"BlackRock client accounts. To the extent that BlackRock uses soft dollars, it will not have to pay for those products","page_number":137,"box":{"x":70,"y":853,"width":819,"height":12}},{"id":"8f5df1bb-7941-4c92-a719-54547b78e3d0","block_type":"box","text":"and services itself.","page_number":137,"box":{"x":69,"y":869,"width":134,"height":9}},{"id":"7292a93b-8f8c-4bb9-9049-65e8d942a652","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may endeavor to execute trades through brokers who, pursuant","page_number":137,"box":{"x":102,"y":891,"width":793,"height":12}},{"id":"3c90ea9b-0da9-46c6-bb6c-9ee8806dbb8a","block_type":"box","text":"to such arrangements, provide research or other services in order to ensure the continued receipt of research or","page_number":137,"box":{"x":68,"y":906,"width":805,"height":12}},{"id":"8efeab3e-3a09-4425-a9f7-279ead3479c6","block_type":"box","text":"II-93","page_number":137,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"6468a031-81ba-4b3e-a39a-e7e9aee12e2b","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":137,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"3c656aa2-2b4e-49a2-8b21-1a099dca5269","block_type":"box","text":"other services BlackRock believes are useful in its investment decision-making process. BlackRock may from time to","page_number":138,"box":{"x":69,"y":45,"width":833,"height":11}},{"id":"0458cee5-9b78-44cd-9807-4c8cd40ad1d6","block_type":"box","text":"time choose not to engage in the above described arrangements to varying degrees. BlackRock, unless prohibited by","page_number":138,"box":{"x":68,"y":60,"width":836,"height":11}},{"id":"d912b334-9683-4d95-b784-1d1f193e74f5","block_type":"box","text":"applicable law, may also enter into commission sharing arrangements under which BlackRock may execute","page_number":138,"box":{"x":69,"y":75,"width":760,"height":11}},{"id":"be9b50d8-eea6-4eb5-bb13-b78b871ac0dc","block_type":"box","text":"transactions through a broker-dealer and request that the broker-dealer allocate a por tion of the commissions or","page_number":138,"box":{"x":68,"y":90,"width":803,"height":11}},{"id":"ca178112-5ebb-45d2-9574-73be2fd102b7","block_type":"box","text":"commission credits to another firm that provides research to BlackRock. To the extent that BlackRock engages in","page_number":138,"box":{"x":69,"y":105,"width":807,"height":11}},{"id":"771ea9d7-90bd-4bef-97e2-ea5bd4d56553","block_type":"box","text":"commission sharing arrangements, many of the same conflicts related to traditional soft dollars may exist.","page_number":138,"box":{"x":69,"y":120,"width":760,"height":12}},{"id":"76e89b0b-a506-42f1-90a7-98df1639b127","block_type":"box","text":"BlackRock may utilize cer tain electronic crossing networks (“ECNs”) (including, without limitation, ECNs in which","page_number":138,"box":{"x":102,"y":143,"width":799,"height":11}},{"id":"e32aace4-fdb9-4804-afc7-f938673bb4dc","block_type":"box","text":"BlackRock has an investment or other interest, to the extent permitted by applicable law) in executing client","page_number":138,"box":{"x":70,"y":158,"width":767,"height":11}},{"id":"aa5c3e75-6195-4f3b-90af-e9c66b06fcb4","block_type":"box","text":"securities transactions for cer tain types of securities. These ECNs may charge fees for their services, including","page_number":138,"box":{"x":69,"y":173,"width":794,"height":11}},{"id":"1035d9af-fa72-49ed-9b0c-e98ff3b55f0f","block_type":"box","text":"access fees and transaction fees. The transaction fees, which are similar to commissions or markups/ markdowns,","page_number":138,"box":{"x":69,"y":188,"width":825,"height":11}},{"id":"ed2b0cf1-1a15-455c-950b-a26b871ca9fb","block_type":"box","text":"will generally be charged to clients and, like commissions and markups/markdowns, would generally be included in","page_number":138,"box":{"x":68,"y":204,"width":821,"height":11}},{"id":"ac5d8e7f-880e-457e-a930-683ec2f3f552","block_type":"box","text":"the cost of the securities purchased. Access fees may be paid by BlackRock even though incurred in connection with","page_number":138,"box":{"x":68,"y":218,"width":833,"height":12}},{"id":"87bc8de5-fb28-40e9-8b47-bd3d6ee32a98","block_type":"box","text":"executing transactions on behalf of clients, including the Funds. In cer tain circumstances, ECNs may offer volume","page_number":138,"box":{"x":69,"y":234,"width":812,"height":11}},{"id":"db3af820-cbee-4489-b9b6-d30942615f09","block_type":"box","text":"discounts that will reduce the access fees typically paid by BlackRock. BlackRock will only utilize ECNs consistent","page_number":138,"box":{"x":69,"y":249,"width":809,"height":11}},{"id":"4fc62d29-71fa-4d73-8ac3-10e1995cd818","block_type":"box","text":"with its obligation to seek to obtain best execution in client transactions.","page_number":138,"box":{"x":68,"y":264,"width":519,"height":11}},{"id":"2f03eaa7-88c7-426c-815d-7a2ed9738df0","block_type":"box","text":"BlackRock owns a minority interest in, and is a member of, Members Exchange (“MEMX”), a newly created U.S.","page_number":138,"box":{"x":102,"y":286,"width":793,"height":12}},{"id":"987e1c4f-1ebe-4028-bece-c23c990452e2","block_type":"box","text":"stock exchange. Transactions for a Fund may be executed on MEMX if third par ty brokers select MEMX as the","page_number":138,"box":{"x":69,"y":302,"width":782,"height":11}},{"id":"d017cdc8-9492-4fc5-b0db-98c3b101b6d5","block_type":"box","text":"appropriate venue for execution of orders placed by BlackRock traders on behalf of client por tfolios.","page_number":138,"box":{"x":69,"y":317,"width":710,"height":11}},{"id":"63623c8f-e1e6-48a7-b242-4b0d20dea136","block_type":"box","text":"BlackRock has adopted policies and procedures designed to prevent conflicts of interest from influencing proxy","page_number":138,"box":{"x":102,"y":339,"width":792,"height":12}},{"id":"84c61056-7019-49ee-8146-9ff86a0c6e88","block_type":"box","text":"voting decisions that it makes on behalf of advisory clients, including the Funds, and to help ensure that such","page_number":138,"box":{"x":68,"y":355,"width":784,"height":11}},{"id":"1bc60768-70d4-4904-8691-b33b0dd2f2d6","block_type":"box","text":"decisions are made in accordance with BlackRock’s fiduciary obligations to its clients. Never theless, notwithstanding","page_number":138,"box":{"x":69,"y":370,"width":837,"height":11}},{"id":"76404824-5f87-4281-ac8e-ac55be16ae71","block_type":"box","text":"such proxy voting policies and procedures, actual proxy voting decisions of BlackRock may have the effect of favoring","page_number":138,"box":{"x":69,"y":385,"width":835,"height":11}},{"id":"c09318a2-8f65-4729-a33d-6ed44b5d6130","block_type":"box","text":"the interests of other clients or businesses of other divisions or units of BlackRock, provided that BlackRock believes","page_number":138,"box":{"x":68,"y":400,"width":837,"height":11}},{"id":"a7e6aaf9-e431-4865-83cf-61ccf80cd8f1","block_type":"box","text":"such voting decisions to be in accordance with its fiduciary obligations. For a more detailed discussion of these","page_number":138,"box":{"x":69,"y":415,"width":795,"height":11}},{"id":"bfef9e7f-cd51-49fc-a4b9-85e14bba2db2","block_type":"box","text":"policies and procedures, see “Proxy Voting Policies and Procedures.”","page_number":138,"box":{"x":70,"y":430,"width":490,"height":11}},{"id":"a78ddc2b-f332-4866-935c-11f3f0c17f69","block_type":"box","text":"It is also possible that, from time to time, BlackRock and/or its advisory clients (including other funds and","page_number":138,"box":{"x":102,"y":453,"width":757,"height":11}},{"id":"31f30ab5-cfd5-48fa-964b-4cf75bb7d009","block_type":"box","text":"separately managed accounts) may, subject to compliance with applicable law, purchase and hold shares of a Fund.","page_number":138,"box":{"x":69,"y":468,"width":825,"height":11}},{"id":"70fb5671-07da-4dc2-bab9-5fb633d41b2a","block_type":"box","text":"Increasing a Fund’s assets may enhance investment flexibility and diversification and may contribute to economies of","page_number":138,"box":{"x":70,"y":483,"width":837,"height":11}},{"id":"1e00aabc-0dce-4c53-9ab1-fc20dcba2aa6","block_type":"box","text":"scale that tend to reduce the Fund’s expense ratio. BlackRock reserves the right, subject to compliance with","page_number":138,"box":{"x":69,"y":498,"width":774,"height":11}},{"id":"93f024dc-8f8d-4cd9-972e-9a18f1111d17","block_type":"box","text":"applicable law, to redeem at any time some or all of the shares of a Fund acquired for its own accounts. A large","page_number":138,"box":{"x":69,"y":513,"width":796,"height":12}},{"id":"8c9267ee-8f7b-4c2c-b630-34542b002628","block_type":"box","text":"redemption of shares of a Fund by BlackRock could significantly reduce the asset size of the Fund, which might have","page_number":138,"box":{"x":69,"y":528,"width":830,"height":12}},{"id":"764c1d8f-d4fa-4a4a-a36d-f7637258caa4","block_type":"box","text":"an adverse effect on the Fund’s investment flexibility, por tfolio diversification and expense ratio. BlackRock seeks to","page_number":138,"box":{"x":69,"y":543,"width":831,"height":12}},{"id":"177c7a0d-8a18-44be-a9d2-463150aeaa21","block_type":"box","text":"consider the effect of redemptions on a Fund and other shareholders in deciding whether to redeem its shares but is","page_number":138,"box":{"x":69,"y":559,"width":834,"height":11}},{"id":"dd5a2188-9bb4-48e3-9d2c-3b4ff974a341","block_type":"box","text":"not obligated to do so and may elect not to do so.","page_number":138,"box":{"x":69,"y":574,"width":355,"height":11}},{"id":"22cc5bd2-bf37-418c-991a-69d893f5af3d","block_type":"box","text":"It is possible that a Fund may invest in securities of, or engage in transactions with, companies in which","page_number":138,"box":{"x":102,"y":596,"width":742,"height":12}},{"id":"d330984f-2d5f-4ca0-af5c-be6ee9468472","block_type":"box","text":"BlackRock has significant debt or equity investments or other interests. 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With respect to BlackRock and its personnel, the remuneration and profitability relating to services to and","page_number":138,"box":{"x":70,"y":740,"width":805,"height":11}},{"id":"09a8d570-ba46-49a5-9908-973040226c74","block_type":"box","text":"sales of the Funds or other products may be greater than remuneration and profitability relating to services to and","page_number":138,"box":{"x":69,"y":755,"width":813,"height":11}},{"id":"e64005e7-a9b2-4555-ad55-8b73f769f6a4","block_type":"box","text":"sales of cer tain funds or other products that might be provided or offered. 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BlackRock has been designated as the Fund’s valuation designee pursuant to Rule 2a-5","page_number":139,"box":{"x":68,"y":143,"width":803,"height":11}},{"id":"6726d675-7ea0-43ab-bf6a-a1be34a41830","block_type":"box","text":"under the Investment Company Act and acts through BlackRock’s Rule 2a-5 Committee (the “2a-5 Committee”), with","page_number":139,"box":{"x":69,"y":158,"width":831,"height":11}},{"id":"e782fb65-da55-4aef-b236-82f6c125fb1b","block_type":"box","text":"assistance from other BlackRock pricing committees and in accordance with BlackRock’s policies and procedures","page_number":139,"box":{"x":69,"y":173,"width":811,"height":11}},{"id":"de126153-6297-465c-a78a-e0d1ec9a980c","block_type":"box","text":"(the “Valuation Procedures”). When determining a “fair value price,” the 2a-5 Committee seeks to determine the","page_number":139,"box":{"x":69,"y":188,"width":802,"height":12}},{"id":"eb3f3274-4b77-4620-af19-93539d7d39a0","block_type":"box","text":"price that a Fund might reasonably expect to receive from the current sale of that asset or liability in an arm’s-length","page_number":139,"box":{"x":70,"y":203,"width":829,"height":12}},{"id":"0a52bd3b-8839-4841-a4da-50e0b82536ea","block_type":"box","text":"transaction. The price generally may not be determined based on what a Fund might reasonably expect to receive for","page_number":139,"box":{"x":68,"y":218,"width":832,"height":12}},{"id":"f743a69b-57e8-4efe-a8fd-1932e15cfd48","block_type":"box","text":"selling an asset or liability at a later time or if it holds the asset or liability to maturity. While fair value determinations","page_number":139,"box":{"x":69,"y":234,"width":837,"height":11}},{"id":"6d0cbbd6-3bdb-4eaa-9ed1-f02fe5b82d10","block_type":"box","text":"will be based upon all available factors that BlackRock deems relevant at the time of the determination, and may be","page_number":139,"box":{"x":68,"y":249,"width":829,"height":11}},{"id":"2e2c096a-d8c8-40b1-9e5d-8fd4bef01e43","block_type":"box","text":"based on analytical values determined by BlackRock using proprietary or third par ty valuation models, fair value","page_number":139,"box":{"x":69,"y":264,"width":796,"height":11}},{"id":"0f0448f9-2245-4092-a967-ab0e777f9b89","block_type":"box","text":"represents only a good faith approximation of the value of an asset or liability. The fair value of one or more assets or","page_number":139,"box":{"x":69,"y":279,"width":839,"height":11}},{"id":"c4e7fc4b-93bc-4614-b822-55d6177d5532","block_type":"box","text":"liabilities may not, in retrospect, be the price at which those assets or liabilities could have been sold during the","page_number":139,"box":{"x":70,"y":294,"width":800,"height":11}},{"id":"9ee49a22-2e1f-49d9-a72b-df80341c2872","block_type":"box","text":"period in which the par ticular fair values were used in determining a Fund’s NAV. 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In connection with any","page_number":139,"box":{"x":69,"y":392,"width":823,"height":12}},{"id":"4f1ab71e-b310-4dc2-a0d1-1399a1289e35","block_type":"box","text":"such investments, a Fund, to the extent permitted by the Investment Company Act, may pay its share of expenses of","page_number":139,"box":{"x":69,"y":407,"width":833,"height":12}},{"id":"e2ecaed6-28f6-4bbe-bf91-de7a99364cc1","block_type":"box","text":"a money market fund or other similarly-managed private fund in which it invests, which may result in a Fund bearing","page_number":139,"box":{"x":69,"y":423,"width":822,"height":11}},{"id":"533858be-f1b3-4c59-9606-06223601315b","block_type":"box","text":"some additional expenses.","page_number":139,"box":{"x":69,"y":438,"width":190,"height":11}},{"id":"88e61072-c375-4874-a135-1b5f7f63a502","block_type":"box","text":"BlackRock and its directors, officers and employees, may buy and sell securities or other investments for their","page_number":139,"box":{"x":102,"y":460,"width":787,"height":12}},{"id":"ef2015fc-9e3e-4075-b3c3-45af7369c9fa","block_type":"box","text":"own accounts and may have conflicts of interest with respect to investments made on behalf of a Fund. 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To lessen the possibility that a Fund will be adversely affected by this personal trading, the Fund, BRIL and","page_number":139,"box":{"x":70,"y":521,"width":802,"height":11}},{"id":"62e831bc-6bb2-4962-b9e6-35613b4112eb","block_type":"box","text":"BlackRock each have adopted a Code of Ethics in compliance with Section 17(j) of the Investment Company Act that","page_number":139,"box":{"x":70,"y":536,"width":828,"height":11}},{"id":"f7d25347-03ac-45cc-9986-0af014dc3a4f","block_type":"box","text":"restricts securities trading in the personal accounts of investment professionals and others who normally come into","page_number":139,"box":{"x":69,"y":551,"width":825,"height":11}},{"id":"999c8817-5c6a-494d-90ac-9bc178867109","block_type":"box","text":"possession of information regarding the Fund’s por tfolio transactions. Each Code of Ethics is also available on the","page_number":139,"box":{"x":70,"y":566,"width":816,"height":11}},{"id":"6fbd92db-9924-4343-a740-1712f5f6371c","block_type":"box","text":"EDGAR Database on the Commission’s Internet site at http://www.sec.gov, and copies may be obtained, after paying","page_number":139,"box":{"x":70,"y":581,"width":836,"height":12}},{"id":"0db80a13-03c6-40f9-86c4-b32be8f3f2c0","block_type":"box","text":"a duplicating fee, by e-mail at publicinfo@sec.gov.","page_number":139,"box":{"x":69,"y":596,"width":352,"height":12}},{"id":"0522f9a3-098b-41bf-83b7-85cff6cdbf37","block_type":"box","text":"BlackRock will not purchase securities or other proper ty from, or sell securities or other proper ty to, a Fund,","page_number":139,"box":{"x":102,"y":619,"width":768,"height":11}},{"id":"8788c8f0-ce39-4ec5-b752-f1dbde00464d","block_type":"box","text":"except that the Fund may in accordance with rules or guidance adopted under the Investment Company Act engage in","page_number":139,"box":{"x":69,"y":634,"width":836,"height":12}},{"id":"c6c79add-cad8-499f-beb5-182f101bb0c1","block_type":"box","text":"transactions with another Fund or accounts that are affiliated with the Fund as a result of common officers, directors,","page_number":139,"box":{"x":68,"y":649,"width":839,"height":11}},{"id":"e9171e49-5e71-4fc1-9e52-a56d262318d6","block_type":"box","text":"or investment advisers or pursuant to exemptive orders granted to the Funds and/or BlackRock by the Commission.","page_number":139,"box":{"x":69,"y":665,"width":824,"height":11}},{"id":"1e4281a2-94bc-49b2-b456-e24f7197a64d","block_type":"box","text":"These transactions would be effected in circumstances in which BlackRock determined that it would be appropriate","page_number":139,"box":{"x":68,"y":680,"width":824,"height":11}},{"id":"b885009d-67d4-41b5-950f-a251fb616882","block_type":"box","text":"for the Fund to purchase and another client of BlackRock to sell, or the Fund to sell and another client of BlackRock","page_number":139,"box":{"x":68,"y":695,"width":826,"height":11}},{"id":"3d6d6f05-0213-4a4e-ace7-b48f0add57d2","block_type":"box","text":"to purchase, the same security or instrument on the same day. From time to time, the activities of a Fund may be","page_number":139,"box":{"x":68,"y":710,"width":810,"height":11}},{"id":"dae50ca4-9edd-4499-abac-b87b0c06149f","block_type":"box","text":"restricted because of regulatory requirements applicable to BlackRock and/or BlackRock’s internal policies designed","page_number":139,"box":{"x":69,"y":725,"width":834,"height":11}},{"id":"9471cc3b-62cd-4dd2-b5dd-bde53c0adc3c","block_type":"box","text":"to comply with, limit the applicability of, or that otherwise relate to such requirements. A client not advised by","page_number":139,"box":{"x":68,"y":740,"width":782,"height":11}},{"id":"3ea0a650-d59e-4d8b-99c0-37f5ac3f7cc5","block_type":"box","text":"BlackRock would not be subject to some of those considerations. There may be periods when BlackRock may not","page_number":139,"box":{"x":70,"y":755,"width":807,"height":11}},{"id":"7c2c7ebc-b78b-4218-b31d-b180cdfaa9f1","block_type":"box","text":"initiate or recommend cer tain types of transactions, or may otherwise restrict or limit its advice regarding cer tain","page_number":139,"box":{"x":70,"y":770,"width":804,"height":12}},{"id":"71c1c0e8-2b11-4247-b37a-ef75fe5484b3","block_type":"box","text":"securities or instruments issued by or related to companies for which BlackRock is per forming advisory or other","page_number":139,"box":{"x":69,"y":785,"width":799,"height":12}},{"id":"73d09746-cba1-4067-ba4f-71dbeeddac97","block_type":"box","text":"services or has proprietary positions. For example, when BlackRock is engaged to provide advisory or risk","page_number":139,"box":{"x":69,"y":801,"width":755,"height":11}},{"id":"e8e375ad-9f2b-49f8-9d27-a38022d7b07e","block_type":"box","text":"management services for a company, BlackRock may be prohibited from or limited in purchasing or selling securities","page_number":139,"box":{"x":69,"y":816,"width":831,"height":11}},{"id":"86888347-b4f0-4a79-a427-85c3af137624","block_type":"box","text":"of that company on behalf of a Fund, par ticularly where such services result in BlackRock obtaining material non","page_number":139,"box":{"x":69,"y":831,"width":806,"height":11}},{"id":"fd77bd2f-beac-4944-b2c0-703b3c4af455","block_type":"box","text":"public information about the company (","page_number":139,"box":{"x":70,"y":846,"width":276,"height":11}},{"id":"b617534d-e803-4577-909c-62c9cd025b49","block_type":"box","text":"e.g.","page_number":139,"box":{"x":348,"y":847,"width":25,"height":10}},{"id":"69e2e5c5-e260-456b-82b9-1e872943da14","block_type":"box","text":", in connection with par ticipation in a creditors’ committee). Moreover,","page_number":139,"box":{"x":376,"y":846,"width":499,"height":11}},{"id":"ca0b1aea-d197-4f77-9681-87aded4bd5c7","block_type":"box","text":"applicable provisions of the Investment Company Act or other regulatory considerations may restrict a Fund or","page_number":139,"box":{"x":69,"y":861,"width":784,"height":11}},{"id":"d9520c7d-d920-4905-b4da-37c9705cc0aa","block_type":"box","text":"BlackRock from effecting cer tain por tfolio transactions or taking other actions in respect of an investment on behalf","page_number":139,"box":{"x":70,"y":876,"width":827,"height":11}},{"id":"45569fe4-dda1-4f2a-9efa-19d25e03ff82","block_type":"box","text":"of a Fund, including where BlackRock and/or clients advised by BlackRock already have an interest in such issuer or","page_number":139,"box":{"x":69,"y":891,"width":830,"height":12}},{"id":"6a3f64f2-9a6a-4e3a-9a1b-6ac45cf66f1e","block_type":"box","text":"the investment. Similar situations could arise if personnel of BlackRock serve as directors of companies the","page_number":139,"box":{"x":68,"y":906,"width":773,"height":11}},{"id":"fb4d01c5-6f40-45da-995a-b2a9620a3f63","block_type":"box","text":"II-95","page_number":139,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"4d77e6d4-8914-41ff-92ee-a79ae2661f2e","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":139,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"56ce7e0f-4c63-4972-bd80-9aaae6c7995c","block_type":"box","text":"securities of which the Funds wish to purchase or sell. 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Cer tain por tfolio management teams within BlackRock may","page_number":140,"box":{"x":69,"y":173,"width":818,"height":11}},{"id":"ff814194-2424-4bff-be49-97341ba6b5a2","block_type":"box","text":"make decisions or take (or refrain from taking) actions with respect to clients they advise in a manner different than","page_number":140,"box":{"x":69,"y":188,"width":827,"height":12}},{"id":"51ea40c5-9a05-412c-9818-ff8e22834be3","block_type":"box","text":"or adverse to the decisions made or the actions taken (or not taken) by the Funds’ por tfolio management teams. The","page_number":140,"box":{"x":69,"y":203,"width":835,"height":12}},{"id":"211afa7d-8e60-4f19-bf04-11b56b4db89f","block_type":"box","text":"various por tfolio management teams may not share information with each other, including as a result of cer tain","page_number":140,"box":{"x":68,"y":218,"width":797,"height":12}},{"id":"1a6f90e1-5981-43b7-8484-c1245f410fba","block_type":"box","text":"information barriers and other policies, and will not have any obligation or other duty to do so.","page_number":140,"box":{"x":70,"y":234,"width":667,"height":11}},{"id":"2af83ab3-a554-4af2-860b-a7adf2304bd0","block_type":"box","text":"BlackRock has established cer tain information barriers and other policies to address the sharing of information","page_number":140,"box":{"x":102,"y":256,"width":794,"height":12}},{"id":"05352d29-e983-463b-9c9e-b5582db0d3b4","block_type":"box","text":"between different businesses within BlackRock, including with respect to personnel responsible with managing","page_number":140,"box":{"x":69,"y":271,"width":791,"height":12}},{"id":"a9a15886-8e3d-4a15-80ed-237bc2f10d04","block_type":"box","text":"por tfolios and voting proxies with respect to cer tain index equity por tfolios versus those responsible for managing","page_number":140,"box":{"x":70,"y":286,"width":812,"height":12}},{"id":"3ba6c98f-086b-4e5b-a9e1-3ffdeb50dd0b","block_type":"box","text":"por tfolios and voting proxies with respect to all other por tfolios. As a result of information barriers, cer tain units of","page_number":140,"box":{"x":70,"y":302,"width":818,"height":11}},{"id":"c2a2a339-275b-43f4-9fd4-7c470e74ca5f","block_type":"box","text":"BlackRock generally will not have access, or will have limited access, to cer tain information and personnel, including","page_number":140,"box":{"x":70,"y":317,"width":830,"height":11}},{"id":"501bbd25-fbf3-4c46-8a3d-ed0ccf313832","block_type":"box","text":"senior personnel, in other units of BlackRock, and generally will not manage the Funds with the benefit of information","page_number":140,"box":{"x":69,"y":332,"width":835,"height":11}},{"id":"5d8c144b-ed93-4104-8462-5d55874a74a3","block_type":"box","text":"possessed by such other units. Therefore, BlackRock may not be able to review potential investments for the Funds","page_number":140,"box":{"x":70,"y":347,"width":824,"height":11}},{"id":"cce88807-8286-4083-a6d7-259b4b37b92d","block_type":"box","text":"with the benefit of information held by cer tain areas of BlackRock.","page_number":140,"box":{"x":68,"y":362,"width":472,"height":11}},{"id":"ae943db6-c6f9-498a-b3cc-33153500e91b","block_type":"box","text":"BlackRock may determine to move cer tain personnel, businesses, or business units from one side of an","page_number":140,"box":{"x":102,"y":385,"width":744,"height":11}},{"id":"8f03af56-a3e1-4d5d-a796-4c5781cd0444","block_type":"box","text":"information barrier to the other side of the information barrier. In connection therewith, BlackRock personnel,","page_number":140,"box":{"x":70,"y":400,"width":775,"height":11}},{"id":"b296f3a9-db42-4ddf-9ff0-dd095245f910","block_type":"box","text":"businesses, and business units that were moved will no longer have access to the information and personnel from","page_number":140,"box":{"x":69,"y":415,"width":818,"height":11}},{"id":"cbe96cd3-b2ea-4012-8afc-f95dd356af7e","block_type":"box","text":"the side of the information barrier from which they were moved. Information obtained in connection with such","page_number":140,"box":{"x":68,"y":430,"width":779,"height":11}},{"id":"d17fb692-b22f-43af-864e-a5866d4e075d","block_type":"box","text":"changes to information barriers may limit or restrict the ability of BlackRock to engage in or otherwise effect","page_number":140,"box":{"x":69,"y":445,"width":771,"height":12}},{"id":"6ab14ff8-d9c6-4d87-89c2-caea19d21192","block_type":"box","text":"transactions on behalf of the Funds (including purchasing or selling securities that BlackRock may otherwise have","page_number":140,"box":{"x":68,"y":460,"width":812,"height":12}},{"id":"a11dda43-6c29-4e44-baa6-3ecc48727b45","block_type":"box","text":"purchased or sold for a client in the absence of a change to an information barrier). Information barriers may not","page_number":140,"box":{"x":70,"y":475,"width":803,"height":12}},{"id":"c3a52cdd-498c-4269-8e4c-ff20e6cf1614","block_type":"box","text":"have their intended impact due to, for example, changes in applicable law or inadver tent crossings of the barriers,","page_number":140,"box":{"x":69,"y":491,"width":813,"height":11}},{"id":"ccd15493-2092-45de-afc8-9b41ff51117d","block_type":"box","text":"and actions by personnel on one side of a barrier may impact the potential actions of personnel on the other side of","page_number":140,"box":{"x":69,"y":506,"width":829,"height":11}},{"id":"a0816d15-1d22-4239-98d2-2d384d51f28e","block_type":"box","text":"a barrier.","page_number":140,"box":{"x":69,"y":521,"width":62,"height":9}},{"id":"47b24726-d6a2-4ef4-8b53-edbc0f3172f0","block_type":"box","text":"Although the information barriers are intended to allow for independent por tfolio management decision-making","page_number":140,"box":{"x":101,"y":543,"width":788,"height":12}},{"id":"e12e8fe7-10df-47fa-b1cb-034d1164b46d","block_type":"box","text":"and proxy voting among cer tain BlackRock businesses, the investment activities of BlackRock for BlackRock clients,","page_number":140,"box":{"x":69,"y":559,"width":827,"height":11}},{"id":"65eebb64-88fb-4d51-b6cb-c60b8220c2fc","block_type":"box","text":"as well as BlackRock’s proprietary accounts, may nonetheless limit the investment strategies and rights of other","page_number":140,"box":{"x":69,"y":574,"width":805,"height":11}},{"id":"efb011fd-87c5-4241-870d-22d9c48de86f","block_type":"box","text":"clients (including the Fund). As BlackRock’s assets under management increases, BlackRock clients may face greater","page_number":140,"box":{"x":69,"y":589,"width":840,"height":11}},{"id":"47ca032d-39c0-4563-913b-2430f7d1d0f5","block_type":"box","text":"negative impacts due to ownership restrictions and limitations imposed by laws, regulations, rules, regulators, or","page_number":140,"box":{"x":69,"y":604,"width":806,"height":11}},{"id":"cd468636-1e48-45c4-bfaa-e37d965422c6","block_type":"box","text":"issuers. For example, in cer tain circumstances where a BlackRock client invests in securities issued by companies","page_number":140,"box":{"x":70,"y":619,"width":818,"height":11}},{"id":"f9d621b0-4337-44b2-9771-05a7b56d32c9","block_type":"box","text":"that operate in cer tain industries (","page_number":140,"box":{"x":68,"y":634,"width":244,"height":11}},{"id":"c6e31b85-c56b-4d70-9118-06cc2db445a8","block_type":"box","text":"e.g.","page_number":140,"box":{"x":314,"y":636,"width":25,"height":10}},{"id":"42ef2d10-a17c-4bfc-8b8c-4ddbf4bb5057","block_type":"box","text":", banking, insurance, and utilities) or in cer tain emerging or international","page_number":140,"box":{"x":342,"y":634,"width":515,"height":12}},{"id":"c92375a8-7ed2-4325-b765-1daa195c5021","block_type":"box","text":"markets, or are subject to regulatory or corporate ownership restrictions (","page_number":140,"box":{"x":69,"y":650,"width":523,"height":11}},{"id":"bffb9120-50c6-4fd3-ad86-4aedb113bbd7","block_type":"box","text":"e.g.","page_number":140,"box":{"x":594,"y":651,"width":25,"height":10}},{"id":"0d8ff575-9419-493a-9277-09fb352f6a48","block_type":"box","text":", with mechanisms such as poison pills","page_number":140,"box":{"x":621,"y":650,"width":280,"height":10}},{"id":"8747204a-efd2-45dc-8360-c0ea6aa46abd","block_type":"box","text":"in place to prevent takeovers), or where a BlackRock client invests in cer tain futures and derivatives, there may be","page_number":140,"box":{"x":70,"y":664,"width":816,"height":12}},{"id":"5e1df24f-5ef0-4bdb-9782-d684c2795802","block_type":"box","text":"limits on the aggregate amount invested by BlackRock for its clients and BlackRock’s proprietary accounts that may","page_number":140,"box":{"x":70,"y":680,"width":825,"height":11}},{"id":"440593be-6fba-43f5-bca8-5f926cedd20a","block_type":"box","text":"not be exceeded without the grant of a license or other regulatory or corporate approval, order, consent, relief, waiver","page_number":140,"box":{"x":69,"y":695,"width":837,"height":11}},{"id":"3df6db5b-8d19-46e7-8166-d1ec00178bc9","block_type":"box","text":"or non-disapproval or, if exceeded, may cause BlackRock or its clients to be subject to enforcement actions,","page_number":140,"box":{"x":69,"y":710,"width":769,"height":11}},{"id":"a2d3b402-d2bd-4cfd-b718-58b93c9400f1","block_type":"box","text":"disgorgement of share ownership or profits, regulatory restrictions, complex compliance repor ting, increased","page_number":140,"box":{"x":69,"y":725,"width":775,"height":11}},{"id":"0c431461-049e-43d3-9c79-65e2f42f6f7f","block_type":"box","text":"compliance costs or suffer disadvantages or business restrictions. In light of cer tain restrictions, BlackRock may also","page_number":140,"box":{"x":69,"y":740,"width":839,"height":11}},{"id":"a486a59b-8d1d-4749-b280-8858296ba619","block_type":"box","text":"seek to make indirect investments (","page_number":140,"box":{"x":69,"y":755,"width":255,"height":11}},{"id":"ce4dd7e9-3b7a-44e0-8dba-dc081536564c","block_type":"box","text":"e.g.","page_number":140,"box":{"x":326,"y":757,"width":24,"height":9}},{"id":"85e4447c-0827-493f-b10f-4b51d4bf121d","block_type":"box","text":", using derivatives) on behalf of its clients to receive exposure to cer tain","page_number":140,"box":{"x":353,"y":755,"width":514,"height":11}},{"id":"484b702d-6a47-40d8-b501-20b7d3c297f4","block_type":"box","text":"securities in excess of the applicable ownership restrictions and limitations when legally permitted that will expose","page_number":140,"box":{"x":69,"y":770,"width":817,"height":12}},{"id":"990af8aa-6a7e-450c-93eb-d22484764fb8","block_type":"box","text":"such clients to additional costs and additional risks, including any risks associated with investing in derivatives.","page_number":140,"box":{"x":69,"y":786,"width":795,"height":11}},{"id":"ff503b54-0b95-4f94-94a3-9cab2bc33505","block_type":"box","text":"There may be limited availability of derivatives that provide indirect exposure to an impacted security. BlackRock","page_number":140,"box":{"x":68,"y":801,"width":799,"height":11}},{"id":"db49f520-1571-4b8b-b21f-c4d95cd563bb","block_type":"box","text":"clients can be subject to more than one ownership limitation depending on each client’s holdings, and each","page_number":140,"box":{"x":69,"y":816,"width":767,"height":11}},{"id":"37dc36d6-a965-4a64-9eab-3e56a391f7a2","block_type":"box","text":"ownership limitation can impact multiple securities held by the client. Cer tain clients or shareholders may have their","page_number":140,"box":{"x":69,"y":831,"width":829,"height":11}},{"id":"732bcce0-f174-4d21-9d5b-133effa8719a","block_type":"box","text":"own overlapping obligations to monitor their compliance with ownership limitations across their investments.","page_number":140,"box":{"x":69,"y":846,"width":772,"height":11}},{"id":"0e50a100-8c62-4daa-9a68-864a4eb2be3e","block_type":"box","text":"If cer tain aggregate ownership thresholds are reached either through the actions of BlackRock or a BlackRock","page_number":140,"box":{"x":102,"y":869,"width":783,"height":11}},{"id":"d5821cfd-963a-4a9a-9076-7cedc9695101","block_type":"box","text":"client or as a result of corporate actions by the issuer, the ability of BlackRock on behalf of clients to purchase or","page_number":140,"box":{"x":69,"y":884,"width":808,"height":11}},{"id":"6560c03a-e640-4e73-a11a-00390ff674a7","block_type":"box","text":"dispose of investments, or exercise rights (including voting) or under take business transactions, may be restricted by","page_number":140,"box":{"x":69,"y":899,"width":837,"height":11}},{"id":"d4524d19-e9f7-44b3-8cad-06e2970df63b","block_type":"box","text":"II-96","page_number":140,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"57c1cfd1-2d11-4810-951e-b076f5c427c2","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":140,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"941f08a3-c162-43a4-a6cc-c070064831a9","block_type":"box","text":"law, regulation, rule, or organizational documents or otherwise impaired. For example, to meet the requirements of","page_number":141,"box":{"x":70,"y":45,"width":818,"height":11}},{"id":"c6bbba97-1a80-4475-9a89-33b0aa00f8c7","block_type":"box","text":"an ownership limitation or restriction, a client may be unable to purchase or directly hold a security the client would","page_number":141,"box":{"x":69,"y":60,"width":821,"height":11}},{"id":"dcd809de-5e0e-44db-8141-3e3226e1e31a","block_type":"box","text":"otherwise purchase or hold. The limitation or restriction may be based on the holdings of other BlackRock clients","page_number":141,"box":{"x":69,"y":75,"width":806,"height":11}},{"id":"3eac89d3-b73c-4d2e-8b90-f680904b528e","block_type":"box","text":"instead of the specific client being restricted. For index funds, this means a fund may not be able to track its index as","page_number":141,"box":{"x":70,"y":90,"width":839,"height":11}},{"id":"482322d4-7f34-4f68-8523-b0b9366df588","block_type":"box","text":"closely as it would if it was not subject to an ownership limitation or restriction because the fund cannot acquire the","page_number":141,"box":{"x":69,"y":105,"width":826,"height":11}},{"id":"6ec7dc86-95fb-4c41-b9cf-4c2145bcb51a","block_type":"box","text":"amount of the impacted security included in its index. BlackRock on behalf of its clients may limit purchases, sell","page_number":141,"box":{"x":69,"y":120,"width":807,"height":11}},{"id":"f6dc0bac-2cba-405b-a02a-5664f333d925","block_type":"box","text":"existing investments, utilize indirect investments, utilize information barriers, or otherwise restrict, forgo, or limit the","page_number":141,"box":{"x":69,"y":135,"width":830,"height":12}},{"id":"e212be26-c42a-431c-9909-a3b70cb808de","block_type":"box","text":"exercise of rights (including transferring, outsourcing, or limiting voting rights or forgoing the right to receive","page_number":141,"box":{"x":69,"y":150,"width":765,"height":12}},{"id":"704cd8e4-2279-4311-a73e-dd689563396d","block_type":"box","text":"dividends) when BlackRock, in its sole discretion, deems it appropriate in light of potential regulatory or other","page_number":141,"box":{"x":69,"y":166,"width":781,"height":11}},{"id":"2c526490-83ac-49cd-8ea8-e38b297e1b6e","block_type":"box","text":"restrictions on ownership or other consequences resulting from reaching investment thresholds. These types of","page_number":141,"box":{"x":69,"y":181,"width":796,"height":11}},{"id":"2de96835-d42f-4652-b96d-737229543faa","block_type":"box","text":"restrictions could negatively impact a client’s per formance or ability to meet its investment objective.","page_number":141,"box":{"x":69,"y":196,"width":720,"height":11}},{"id":"c73ee68e-20c5-4f0f-8d9d-6a6c57b2f757","block_type":"box","text":"When BlackRock or a BlackRock client is subject to an ownership limitation, BlackRock may in its discretion seek","page_number":141,"box":{"x":101,"y":219,"width":807,"height":11}},{"id":"dd1d204e-6528-4d62-890a-cd16c0f9fcca","block_type":"box","text":"permission from the applicable issuers or regulators to exceed the limitation. However, there is no guarantee that","page_number":141,"box":{"x":70,"y":234,"width":810,"height":11}},{"id":"ffc14700-cb2b-4850-bdac-70ee76b96563","block_type":"box","text":"permission will be granted, or that, once granted, it will not be modified or revoked at a later date with minimal or no","page_number":141,"box":{"x":70,"y":249,"width":829,"height":11}},{"id":"dff68949-48ea-42c2-bc5b-87a3fade3840","block_type":"box","text":"notice. The issuer and/or regulator may also require that BlackRock on behalf of itself and its clients take or refrain","page_number":141,"box":{"x":69,"y":264,"width":824,"height":11}},{"id":"b541a922-c564-4b1d-9604-9a5537fb0b34","block_type":"box","text":"from taking cer tain actions in connection with the approval, order, consent, relief or non-disapproval, which BlackRock","page_number":141,"box":{"x":68,"y":279,"width":841,"height":11}},{"id":"8f57fa77-bba4-4110-a383-a8a1a852c73d","block_type":"box","text":"may accept if it believes the benefits outweigh the costs and may limit BlackRock from taking actions that it","page_number":141,"box":{"x":69,"y":294,"width":770,"height":11}},{"id":"53f9dfa4-ff18-4626-a4e0-6090474de2fc","block_type":"box","text":"otherwise would take. In those circumstances where ownership thresholds or limitations must be observed,","page_number":141,"box":{"x":69,"y":309,"width":769,"height":11}},{"id":"5ea74e16-e365-46f7-9c1f-2f6be05bd884","block_type":"box","text":"BlackRock seeks to allocate limited investment oppor tunities equitably among clients, taking into consideration","page_number":141,"box":{"x":70,"y":325,"width":794,"height":11}},{"id":"33d086db-fe4f-451d-b788-7252215db134","block_type":"box","text":"benchmark weight and investment strategy. BlackRock may adopt cer tain controls designed to prevent the","page_number":141,"box":{"x":69,"y":340,"width":757,"height":11}},{"id":"8e9b4857-e4d3-4b6d-8328-8c63b627816d","block_type":"box","text":"occurrence of a breach of any applicable ownership threshold or limits, including, for example, when ownership in","page_number":141,"box":{"x":69,"y":355,"width":807,"height":11}},{"id":"0ad815d4-4484-4907-b82b-8dfadc30da38","block_type":"box","text":"cer tain securities nears an applicable threshold, BlackRock may limit additional purchases in such securities or, with","page_number":141,"box":{"x":69,"y":370,"width":833,"height":11}},{"id":"0546e0a0-2a14-4203-842a-faae9cfd4c52","block_type":"box","text":"respect to ETFs, remove such securities from the list of Deposit Securities to be delivered to the Fund in connection","page_number":141,"box":{"x":69,"y":385,"width":827,"height":11}},{"id":"1cc4a500-a577-4dde-8dcb-e84c57c4cee7","block_type":"box","text":"with purchases of Creation Units of such Fund. If client holdings of an issuer exceed an applicable threshold and","page_number":141,"box":{"x":68,"y":400,"width":803,"height":11}},{"id":"d8dc3a1e-b842-4919-b787-cefd7f1c1fa0","block_type":"box","text":"BlackRock is unable to obtain relief to enable the continued holding of such investments, it may be necessary to","page_number":141,"box":{"x":70,"y":415,"width":802,"height":11}},{"id":"d1eb9e87-369d-4890-b4b1-dafc3609952d","block_type":"box","text":"reduce these positions to meet the applicable limitations and BlackRock or such client may be subject to regulatory","page_number":141,"box":{"x":69,"y":430,"width":826,"height":11}},{"id":"fa0d9f81-9a67-4cd3-be03-052b4d20c16d","block_type":"box","text":"actions. In these cases, the investments will be sold in a manner that BlackRock deems fair and equitable over time.","page_number":141,"box":{"x":69,"y":445,"width":834,"height":11}},{"id":"846f3abf-5a78-4d9d-a7ec-495161b8d38b","block_type":"box","text":"Ownership limitations are highly complex. It is possible that, despite BlackRock’s intent to either comply with or","page_number":141,"box":{"x":102,"y":468,"width":795,"height":11}},{"id":"0934d5da-aec6-4123-a5b8-7d92ac886211","block_type":"box","text":"be granted permission to exceed ownership limitations, it may inadver tently breach a limit or violate the corporate or","page_number":141,"box":{"x":69,"y":483,"width":831,"height":11}},{"id":"b0230057-ec3a-4a6e-a3f1-ea152b6d43b5","block_type":"box","text":"regulatory approval, order, consent, relief or non-disapproval that was obtained.","page_number":141,"box":{"x":69,"y":498,"width":566,"height":11}},{"id":"0e140d9a-9e94-43b7-a67f-509ddb5a4133","block_type":"box","text":"In addition to the foregoing, other ownership thresholds may trigger repor ting requirements to governmental and","page_number":141,"box":{"x":102,"y":521,"width":798,"height":11}},{"id":"3963ee45-eb1d-4f21-b387-8b6877764764","block_type":"box","text":"regulatory authorities, and such repor ts may entail the disclosure of the identity of a client or BlackRock’s intended","page_number":141,"box":{"x":69,"y":536,"width":823,"height":11}},{"id":"9b89404a-0c54-463d-837a-47f3ffff2fbe","block_type":"box","text":"strategy with respect to such security or asset.","page_number":141,"box":{"x":69,"y":551,"width":333,"height":11}},{"id":"de63f54f-0f00-4dc9-9e20-06c240ec4b74","block_type":"box","text":"BlackRock may maintain securities indices. To the extent permitted by applicable laws, the Funds may seek to","page_number":141,"box":{"x":102,"y":574,"width":785,"height":11}},{"id":"02ad3a2d-6bbe-42dc-89b0-a3a6973194e6","block_type":"box","text":"license and use such indices as par t of their investment strategy. Index based funds that seek to track the","page_number":141,"box":{"x":70,"y":589,"width":760,"height":11}},{"id":"a57ea185-9873-452d-b299-8193577e22bc","block_type":"box","text":"per formance of securities indices also may use the name of the index or index provider in the fund name. Index","page_number":141,"box":{"x":70,"y":604,"width":796,"height":11}},{"id":"546b0f2d-b01b-43c2-b819-5e8684f9c1ae","block_type":"box","text":"providers, including BlackRock (to the extent permitted by applicable law), may be paid licensing fees for use of their","page_number":141,"box":{"x":70,"y":619,"width":830,"height":11}},{"id":"3b69c945-ea44-4971-bd7e-f464337b8a4e","block_type":"box","text":"index or index name. In instances where BlackRock charges a unitary management fee, BlackRock may have a","page_number":141,"box":{"x":70,"y":634,"width":788,"height":12}},{"id":"28948c02-09f7-465c-b55b-b4f3b448961b","block_type":"box","text":"financial incentive to use a BlackRock index that is less costly to BlackRock than a third par ty index. BlackRock may","page_number":141,"box":{"x":68,"y":649,"width":829,"height":12}},{"id":"0d520b53-5748-457d-aa70-12452536127b","block_type":"box","text":"benefit from the Funds using BlackRock indices by creating increasing acceptance in the marketplace for such","page_number":141,"box":{"x":69,"y":664,"width":784,"height":12}},{"id":"b6794869-5332-4d9a-ab9e-7c079dcd949f","block_type":"box","text":"indices. BlackRock is not obligated to license its indices to a Fund and the Funds are under no obligation to use","page_number":141,"box":{"x":70,"y":680,"width":797,"height":11}},{"id":"c97b36b3-17a7-43f2-b338-98d770be5b26","block_type":"box","text":"BlackRock indices. Any Fund that enters into a license for a BlackRock index cannot be assured that the terms of any","page_number":141,"box":{"x":70,"y":695,"width":837,"height":11}},{"id":"ea378424-33a1-4563-9a36-e4e96264a84e","block_type":"box","text":"index licensing agreement with BlackRock will be as favorable as those terms offered to other licensees.","page_number":141,"box":{"x":70,"y":710,"width":746,"height":11}},{"id":"3fd72b3f-214b-402e-9dcd-4bbae4b5562f","block_type":"box","text":"BlackRock may enter into contractual arrangements with third-par ty service providers to a Fund (","page_number":141,"box":{"x":102,"y":733,"width":686,"height":11}},{"id":"9d934339-4f8c-4b8b-8f5f-0b435fe60016","block_type":"box","text":"e.g.","page_number":141,"box":{"x":790,"y":734,"width":25,"height":10}},{"id":"4942f61d-4f4a-4e02-80e7-f1eeba4d9b98","block_type":"box","text":", custodians,","page_number":141,"box":{"x":817,"y":733,"width":90,"height":10}},{"id":"96e6849a-6f76-457f-a5c9-ed4183d6f055","block_type":"box","text":"administrators and index providers) pursuant to which BlackRock receives fee discounts or concessions in","page_number":141,"box":{"x":69,"y":748,"width":756,"height":11}},{"id":"6b39feb3-c281-4e5b-956b-7f38c197667e","block_type":"box","text":"recognition of BlackRock’s overall relationship with such service providers. BlackRock may also enter into contractual","page_number":141,"box":{"x":69,"y":763,"width":836,"height":11}},{"id":"64ba7c79-d33f-4d6f-81f6-7d58038a675b","block_type":"box","text":"arrangements with such service providers pursuant to which BlackRock incurs additional costs if the service","page_number":141,"box":{"x":69,"y":778,"width":772,"height":11}},{"id":"bf35368d-a4f1-4ef1-8a5f-bb273e696b37","block_type":"box","text":"provider’s services are terminated with respect to a Fund. To the extent that BlackRock is responsible for paying","page_number":141,"box":{"x":70,"y":793,"width":800,"height":11}},{"id":"79b7d894-fe14-4aec-bf8c-b4ebec928849","block_type":"box","text":"service providers out of its fees that it receives from the Funds, the benefits of lower fees, including any fee","page_number":141,"box":{"x":69,"y":808,"width":771,"height":11}},{"id":"ee4904a5-fcc8-4a86-997f-05d2a545ce1e","block_type":"box","text":"discounts or concessions, or any additional savings, may accrue, in whole or in par t, to BlackRock, which could result","page_number":141,"box":{"x":69,"y":823,"width":839,"height":12}},{"id":"ef9d2558-0f43-4eb7-9abf-c63212480ea4","block_type":"box","text":"in conflicts of interest relating to the use or termination of service providers to a Fund. In addition, conflicts of","page_number":141,"box":{"x":70,"y":838,"width":785,"height":12}},{"id":"3ef4b745-f7d8-46dd-a75f-4ca4448a0d7e","block_type":"box","text":"interest may arise with respect to contractual arrangements with third-par ty service providers to a Fund, or the","page_number":141,"box":{"x":70,"y":854,"width":786,"height":11}},{"id":"eb6a1f21-79ce-41a9-97b8-beb1a744f9a4","block_type":"box","text":"selection of such providers, par ticularly in circumstances where BlackRock is negotiating on behalf of both funds that","page_number":141,"box":{"x":69,"y":869,"width":837,"height":11}},{"id":"aa9e07d7-709f-4227-a628-b4b46e6ce766","block_type":"box","text":"have a unitary management fee and those that do not or different service providers have different fee structures.","page_number":141,"box":{"x":69,"y":884,"width":809,"height":11}},{"id":"d42c7eb3-3416-441a-b57e-afa01e0a86ef","block_type":"box","text":"II-97","page_number":141,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"6c801177-1c03-4023-b1ab-de0478d589a2","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":141,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"90d93386-eddf-4b65-9f56-b2b21a803d0a","block_type":"box","text":"Conflicts of interest may arise as a result of simultaneous investment management of multiple client accounts","page_number":142,"box":{"x":102,"y":45,"width":788,"height":11}},{"id":"a4bed3b9-0c63-4b3a-8e9f-e12d1926acbb","block_type":"box","text":"by BlackRock’s investment professionals. For example, differences in the advisory fee structure may create the","page_number":142,"box":{"x":69,"y":60,"width":795,"height":11}},{"id":"b97dd61d-5f37-406c-8f8b-ef8e70296718","block_type":"box","text":"appearance of actual or potential conflicts of interest because such differences could create pecuniary incentives for","page_number":142,"box":{"x":69,"y":75,"width":835,"height":11}},{"id":"bec73a34-5dd5-4d82-abfe-2e657f4f9f38","block_type":"box","text":"BlackRock to favor one client account over another.","page_number":142,"box":{"x":70,"y":90,"width":363,"height":9}},{"id":"731713a3-7b07-4ac0-89d6-5ccdada3d3ae","block_type":"box","text":"BlackRock owns or has an ownership interest in cer tain trading, por tfolio management, operations and/or","page_number":142,"box":{"x":102,"y":113,"width":757,"height":11}},{"id":"fcad64f2-881e-4bd7-9217-93e44a441334","block_type":"box","text":"information systems used by Fund service providers. These systems are, or will be, used by a Fund service provider","page_number":142,"box":{"x":70,"y":128,"width":826,"height":11}},{"id":"299443c3-08b9-4f3a-888c-9bedaf2068c8","block_type":"box","text":"in connection with the provision of services to accounts managed by BlackRock and funds managed and sponsored","page_number":142,"box":{"x":70,"y":143,"width":822,"height":11}},{"id":"3b509478-8605-483e-b600-0fe1851d3065","block_type":"box","text":"by BlackRock, including the Funds, that engage the service provider (typically the custodian). A Fund’s service","page_number":142,"box":{"x":69,"y":158,"width":782,"height":11}},{"id":"004c7b64-ef5c-4408-9019-5683d724835a","block_type":"box","text":"provider remunerates BlackRock for the use of the systems. A Fund service provider’s payments to BlackRock for the","page_number":142,"box":{"x":70,"y":173,"width":835,"height":11}},{"id":"4c4ba860-31ef-4f1f-bfe0-4e4f3797fbc2","block_type":"box","text":"use of these systems may enhance the profitability of BlackRock.","page_number":142,"box":{"x":69,"y":188,"width":465,"height":11}},{"id":"2fc37573-eb44-4fe5-ad25-618e844ed7d6","block_type":"box","text":"BlackRock’s receipt of fees from a service provider in connection with the use of systems provided by BlackRock","page_number":142,"box":{"x":102,"y":211,"width":804,"height":11}},{"id":"4bfc5d86-60ce-438c-b553-528e0e9e3820","block_type":"box","text":"may create an incentive for BlackRock to recommend that a Fund enter into or renew an arrangement with the service","page_number":142,"box":{"x":69,"y":226,"width":840,"height":11}},{"id":"12f10ac9-0d87-4d60-8772-473e59767b6e","block_type":"box","text":"provider.","page_number":142,"box":{"x":70,"y":241,"width":58,"height":11}},{"id":"dc4fca59-66d5-4720-8100-3ba11133ebe0","block_type":"box","text":"In recognition of a BlackRock client’s overall relationship with BlackRock, BlackRock may offer special pricing","page_number":142,"box":{"x":102,"y":264,"width":778,"height":11}},{"id":"746e0878-9835-4f38-9415-2993ddd85f9e","block_type":"box","text":"arrangements for cer tain services provided by BlackRock. Any such special pricing arrangements will not affect Fund","page_number":142,"box":{"x":69,"y":279,"width":831,"height":11}},{"id":"6f33a62a-865b-48ed-919e-b10627490f7f","block_type":"box","text":"fees and expenses applicable to such client’s investment in a Fund.","page_number":142,"box":{"x":68,"y":294,"width":485,"height":11}},{"id":"d0e521d9-0d3a-49d0-b366-6e8c9b09225d","block_type":"box","text":"Present and future activities of BlackRock and its directors, officers and employees, in addition to those","page_number":142,"box":{"x":102,"y":317,"width":742,"height":11}},{"id":"93ff6042-3799-42f2-921d-2b5e5ac0ffc7","block_type":"box","text":"described in this section, may give rise to additional conflicts of interest.","page_number":142,"box":{"x":69,"y":332,"width":517,"height":11}},{"id":"5bf5464a-415a-4cca-a723-6ea17545daf0","block_type":"box","text":"PURCHASE OF SHARES","page_number":142,"box":{"x":395,"y":361,"width":188,"height":10}},{"id":"4ae75c77-5aff-4f95-a7c9-e1a0330ddc85","block_type":"box","text":"Most BlackRock-advised open-end funds offer multiple classes of shares under a plan adopted under Rule 18f-3","page_number":142,"box":{"x":102,"y":384,"width":800,"height":11}},{"id":"48aab726-9a6b-4843-9ab1-7ab2ad194475","block_type":"box","text":"under the Investment Company Act. Investor A Shares are sold to investors choosing the initial sales charge","page_number":142,"box":{"x":69,"y":399,"width":771,"height":12}},{"id":"9139920d-06e3-41f5-b51e-58e5c929b1c7","block_type":"box","text":"alternative, except that Investor A Shares of Index Funds (defined below) and BlackRock Shor t Obligations Fund are","page_number":142,"box":{"x":69,"y":414,"width":822,"height":12}},{"id":"16fac1c6-0fab-486d-99fd-e4493982d066","block_type":"box","text":"generally not subject to an initial sales charge, and Investor C Shares are sold to investors choosing the deferred","page_number":142,"box":{"x":68,"y":429,"width":809,"height":12}},{"id":"bbc6eef8-809b-4426-8145-e2c5860beb68","block_type":"box","text":"sales charge alternative. Investor P Shares are available only to cer tain investors purchasing shares of Funds","page_number":142,"box":{"x":69,"y":445,"width":781,"height":11}},{"id":"332cc5bd-e1ac-485a-b2da-e0982723fbd8","block_type":"box","text":"through registered representatives of an insurance company’s broker-dealer that has entered into an agreement with","page_number":142,"box":{"x":68,"y":460,"width":833,"height":11}},{"id":"2bd10637-c0b8-4cd2-be91-bf8cbc00d783","block_type":"box","text":"the Distributor to offer such shares. Institutional Shares are sold to cer tain eligible investors without a sales charge.","page_number":142,"box":{"x":68,"y":475,"width":833,"height":11}},{"id":"572d8060-74fe-4a9b-b103-07849dba5b33","block_type":"box","text":"Cer tain Funds offer Class R Shares, which are available only to cer tain employer-sponsored retirement plans and are","page_number":142,"box":{"x":69,"y":490,"width":835,"height":11}},{"id":"8ec508d2-6a5e-4c9e-b9fb-95c72db07623","block_type":"box","text":"sold without a sales charge. Cer tain Funds offer Class G Shares, which are available only to investors on eligible","page_number":142,"box":{"x":69,"y":505,"width":804,"height":11}},{"id":"1a3577ae-ef63-4baf-a154-e1d2e0dc9d5a","block_type":"box","text":"platforms, which are platforms where clients invest in the Fund through a single omnibus account in the name of a","page_number":142,"box":{"x":70,"y":520,"width":816,"height":12}},{"id":"f90f5c3f-60c8-4408-8548-dd9ed222f96e","block_type":"box","text":"financial intermediary that meets an initial investment minimum of $2 billion. In addition, cer tain Funds offer Service","page_number":142,"box":{"x":68,"y":535,"width":835,"height":11}},{"id":"4eda2b57-73f7-451c-9620-941ff325728a","block_type":"box","text":"Shares, BlackRock Shares and/or Class K Shares that are available only to cer tain eligible investors. Please see the","page_number":142,"box":{"x":69,"y":551,"width":834,"height":11}},{"id":"fef761fd-c45a-4645-bfe1-574f4ff45f8e","block_type":"box","text":"appropriate Prospectus for your Fund to determine which classes are offered by your Fund and under what","page_number":142,"box":{"x":69,"y":566,"width":757,"height":11}},{"id":"81c8e66b-28d4-41f4-9a87-57299ab83b63","block_type":"box","text":"circumstances. Each class has different exchange privileges. See “Shareholder Services — Exchange Privilege.”","page_number":142,"box":{"x":69,"y":581,"width":802,"height":11}},{"id":"ff51567a-1680-4d8c-a1d7-235dd9e68415","block_type":"box","text":"The applicable offering price for purchase orders is based on the NAV of a Fund next determined after receipt of","page_number":142,"box":{"x":101,"y":603,"width":799,"height":12}},{"id":"03c7b85f-0763-47ad-8847-91dcbd1b14a5","block_type":"box","text":"the purchase order by a dealer or other financial intermediary (“Selling Dealer”) that has been authorized by the","page_number":142,"box":{"x":68,"y":618,"width":798,"height":12}},{"id":"bec01bd3-6293-475b-a28e-a4137e47a0ed","block_type":"box","text":"Distributor by contract to accept such orders. In addition, with respect to the affiliated underlying funds in which","page_number":142,"box":{"x":70,"y":634,"width":795,"height":11}},{"id":"b5a25119-4c54-4317-969b-3d6b7fc94a39","block_type":"box","text":"target date funds advised by BlackRock or its affiliates (“BlackRock Target Date Funds”) invest, the applicable","page_number":142,"box":{"x":68,"y":649,"width":786,"height":11}},{"id":"f236b2f9-7f80-474b-8000-06cd37b26872","block_type":"box","text":"offering price of each affiliated underlying fund is based on the NAV of such affiliated underlying fund next determined","page_number":142,"box":{"x":69,"y":664,"width":839,"height":11}},{"id":"2e0a3127-18bc-4eb7-9c23-beb657d26055","block_type":"box","text":"after a purchase order is received, or deemed to be received upon receipt by a Selling Dealer, by the BlackRock","page_number":142,"box":{"x":69,"y":679,"width":795,"height":11}},{"id":"f3cefc55-4292-444f-8a4e-b7c683d65050","block_type":"box","text":"Target Date Funds that allocate a por tion of such purchase order to such affiliated underlying fund. As to purchase","page_number":142,"box":{"x":68,"y":694,"width":819,"height":11}},{"id":"f4434a18-9ab6-4db3-9541-2245522b9308","block_type":"box","text":"orders received by Selling Dealers or BlackRock Target Date Funds prior to the close of business on the New York","page_number":142,"box":{"x":69,"y":709,"width":808,"height":11}},{"id":"f4afe0ca-6350-4b91-b6e7-be7a0ca376f4","block_type":"box","text":"Stock Exchange (“NYSE”) (generally, the NYSE closes at 4:00 p.m. Eastern time), on the day the order is placed,","page_number":142,"box":{"x":69,"y":724,"width":803,"height":12}},{"id":"f8e59112-f474-4347-8cf5-deee578f6839","block_type":"box","text":"including orders received after the close of business on the previous day, the applicable offering price is based on","page_number":142,"box":{"x":70,"y":739,"width":812,"height":12}},{"id":"c9918cbc-5659-42a4-861d-e73355e2ad60","block_type":"box","text":"the NAV determined as of the close of business on the NYSE on that day. If the purchase orders are not received by","page_number":142,"box":{"x":68,"y":755,"width":828,"height":11}},{"id":"7a5bfd28-480f-4262-96b2-dade3ccc4b2e","block_type":"box","text":"the Selling Dealer or a BlackRock Target Date Fund before the close of business on the NYSE, such orders are","page_number":142,"box":{"x":68,"y":770,"width":788,"height":11}},{"id":"de826d60-1468-4a0d-9ed3-6798e2d279fe","block_type":"box","text":"deemed received on the next business day. It is the responsibility of brokers to transmit purchase orders and","page_number":142,"box":{"x":69,"y":785,"width":779,"height":11}},{"id":"078411f6-0e92-42e5-b471-7e02afe1ea93","block_type":"box","text":"payment on a timely basis. Generally, if payment is not received within the period described in the Prospectuses, the","page_number":142,"box":{"x":70,"y":800,"width":830,"height":11}},{"id":"719f7971-2645-42e7-8cb7-d070fb005a19","block_type":"box","text":"order will be canceled, notice thereof will be given, and the broker and its customers will be responsible for any loss","page_number":142,"box":{"x":69,"y":815,"width":828,"height":11}},{"id":"f7ded4cc-78a5-4ada-a371-e7b058a582dc","block_type":"box","text":"to the Fund or its shareholders. Orders of less than $500 may be mailed by a broker to the Transfer Agent.","page_number":142,"box":{"x":68,"y":829,"width":762,"height":12}},{"id":"db343668-5d47-419e-b7a4-8160be926db1","block_type":"box","text":"The minimum investment for the initial purchase of shares is set for th in the Prospectus for each Fund. The","page_number":142,"box":{"x":101,"y":853,"width":768,"height":11}},{"id":"70872860-17ad-474c-bdc8-c68e0c536904","block_type":"box","text":"minimum initial investment for employees of a Fund, a Fund’s Manager, Sub-Advisers or BRIL or employees of their","page_number":142,"box":{"x":69,"y":868,"width":819,"height":11}},{"id":"8696fda7-9e39-4a98-8c8c-713256404a41","block_type":"box","text":"affiliates is $100, unless payment is made through a payroll deduction program in which case the minimum","page_number":142,"box":{"x":69,"y":882,"width":769,"height":12}},{"id":"3546ea1d-fb7d-4211-927b-4c1dd74a9738","block_type":"box","text":"investment is $25.","page_number":142,"box":{"x":70,"y":898,"width":132,"height":10}},{"id":"9c2499b6-4bae-4d66-96c5-ba728c58261f","block_type":"box","text":"II-98","page_number":142,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"2bf9de45-8303-487b-b01a-84ed813830ef","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":142,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"6696a4c4-40a9-4db1-bab8-fe66b7e58769","block_type":"box","text":"Each Fund has lower investment minimums for other categories of shareholders eligible to purchase Institutional","page_number":143,"box":{"x":102,"y":45,"width":802,"height":11}},{"id":"6bd00db9-7bba-44f6-900a-209c6cd62254","block_type":"box","text":"Shares, including selected fee-based programs. Each Fund may permit a lower initial investment for cer tain investors","page_number":143,"box":{"x":69,"y":60,"width":833,"height":11}},{"id":"d424b5de-c28b-41b5-9242-a5bb4be6b02e","block_type":"box","text":"if their purchase, combined with purchases by other investors received together by the Fund, meets the minimum","page_number":143,"box":{"x":70,"y":75,"width":806,"height":11}},{"id":"cec39879-8d05-471f-ab30-becaf15ee2d9","block_type":"box","text":"investment requirement. Each Fund may reject any purchase order, modify or waive the minimum initial or","page_number":143,"box":{"x":70,"y":90,"width":751,"height":11}},{"id":"41b46475-8d02-433e-a728-0ba343a592b7","block_type":"box","text":"subsequent investment requirements and suspend and resume the sale of any share class of any Fund at any time.","page_number":143,"box":{"x":69,"y":105,"width":826,"height":11}},{"id":"e3b100d0-65ca-42ea-8c52-b021d961287c","block_type":"box","text":"Financial intermediaries may, in connection with a change in account type or otherwise in accordance with a","page_number":143,"box":{"x":102,"y":128,"width":768,"height":11}},{"id":"62722fbe-5291-4f18-ac87-e1d24544339c","block_type":"box","text":"financial intermediary’s policies and procedures, exchange shares of a Fund from one class of shares to another","page_number":143,"box":{"x":68,"y":143,"width":807,"height":11}},{"id":"2d4b5c6e-52be-4bc1-bb33-c25a6a078e70","block_type":"box","text":"class of shares of the same Fund, provided that the exchanged shares are not subject to a contingent deferred sales","page_number":143,"box":{"x":69,"y":158,"width":836,"height":11}},{"id":"ebe6d34f-e865-47fd-94d6-470cb4f96972","block_type":"box","text":"charge (“CDSC”) and that shareholders meet eligibility requirements of the new share class. Please speak to your","page_number":143,"box":{"x":69,"y":173,"width":814,"height":11}},{"id":"cc00ced8-af7e-4aca-b1a4-997215d225f9","block_type":"box","text":"financial intermediary for information about specific policies and procedures applicable to your account.","page_number":143,"box":{"x":68,"y":188,"width":740,"height":11}},{"id":"9a8e3c1f-a012-41e0-bd7d-edd3da09fcf6","block_type":"box","text":"Each Fund or the Distributor may suspend the continuous offering of the Fund’s shares of any class at any time","page_number":143,"box":{"x":102,"y":211,"width":795,"height":11}},{"id":"553133b3-9173-4190-bffc-b95867d95e13","block_type":"box","text":"in response to conditions in the securities markets or otherwise and may resume offering the shares from time to","page_number":143,"box":{"x":70,"y":226,"width":813,"height":11}},{"id":"2b15416b-f3d8-4b7c-b61b-9d97fe8424e7","block_type":"box","text":"time. Any order may be rejected by a Fund or the Distributor. Neither the Distributor, the securities dealers nor other","page_number":143,"box":{"x":68,"y":241,"width":827,"height":11}},{"id":"c81ca5c2-b187-447f-bbe1-6efbe2f7df88","block_type":"box","text":"financial intermediaries are permitted to withhold placing orders to benefit themselves by a price change.","page_number":143,"box":{"x":68,"y":256,"width":750,"height":12}},{"id":"17c30e98-6fbb-46f4-99b4-2f16d65754b2","block_type":"box","text":"The term “purchase,” as used in the Prospectus and this SAI, refers to (i) a single purchase by an individual,","page_number":143,"box":{"x":101,"y":279,"width":776,"height":11}},{"id":"7ba14afc-92bb-4642-a2e9-431690cc6b4e","block_type":"box","text":"(ii) concurrent purchases by an individual, his or her spouse and their children purchasing shares for his, her or their","page_number":143,"box":{"x":69,"y":294,"width":831,"height":11}},{"id":"bf0455e2-ca08-4670-a527-812356fd8f34","block_type":"box","text":"own account, and (iii) single purchases by a trustee or other fiduciary purchasing shares for a single trust estate or","page_number":143,"box":{"x":69,"y":309,"width":822,"height":11}},{"id":"2ec42763-080c-4721-836f-d3724d77eec8","block_type":"box","text":"single fiduciary account although more than one beneficiary may be involved. The term “purchase” also includes","page_number":143,"box":{"x":69,"y":324,"width":802,"height":12}},{"id":"01627c9b-5228-4a66-ac14-0286188a60fa","block_type":"box","text":"purchases by any “company,” as that term is defined in the Investment Company Act, but does not include purchases","page_number":143,"box":{"x":70,"y":339,"width":839,"height":12}},{"id":"f2371ac8-8f03-4048-b384-9829508daa7d","block_type":"box","text":"by (i) any company that has not been in existence for at least six months, (ii) a company that has no purpose other","page_number":143,"box":{"x":69,"y":355,"width":819,"height":11}},{"id":"4fe63b91-4546-480b-8928-c2ef76fbb161","block_type":"box","text":"than the purchase of shares of a Fund or shares of other registered investment companies at a discount, or (iii) any","page_number":143,"box":{"x":68,"y":370,"width":827,"height":11}},{"id":"1f09646f-d37f-48ef-bf5b-eeffbf36e7d1","block_type":"box","text":"group of individuals whose sole organizational nexus is that its par ticipants are credit cardholders of a company,","page_number":143,"box":{"x":68,"y":385,"width":803,"height":11}},{"id":"1aa3bb5f-4fc8-467e-82ae-1229685d81a6","block_type":"box","text":"policyholders of an insurance company, customers of either a bank or broker-dealer or clients of an investment","page_number":143,"box":{"x":70,"y":400,"width":788,"height":11}},{"id":"7703d109-e851-48f0-a998-6b3f0ff0ad06","block_type":"box","text":"adviser.","page_number":143,"box":{"x":69,"y":415,"width":53,"height":9}},{"id":"26d551b7-b71b-40cd-b8f8-4aebf12e4856","block_type":"box","text":"With cer tain limited exceptions, the Funds are generally available only to investors residing in the United States","page_number":143,"box":{"x":101,"y":438,"width":795,"height":11}},{"id":"e779ffad-999c-4c04-997c-74a29af6e60d","block_type":"box","text":"and may not be distributed by a foreign financial intermediary. Under this policy, in order to accept new accounts or","page_number":143,"box":{"x":69,"y":453,"width":821,"height":11}},{"id":"df350dfc-7fdd-494a-9cee-d13baca3f1eb","block_type":"box","text":"additional investments (including by way of exchange from another Fund) into existing accounts, a Fund generally","page_number":143,"box":{"x":69,"y":468,"width":803,"height":11}},{"id":"731e0e01-b618-40f4-a495-621873e8e1be","block_type":"box","text":"requires that (i) a shareholder that is a natural person be a U.S. citizen or resident alien, in each case residing within","page_number":143,"box":{"x":69,"y":483,"width":834,"height":11}},{"id":"0108e6c2-935e-43a5-a15e-6d03888c0f13","block_type":"box","text":"the United States or a U.S. territory (including APO/FPO/DPO addresses), and have a valid U.S. taxpayer","page_number":143,"box":{"x":68,"y":498,"width":747,"height":11}},{"id":"1e9f87ac-26ac-441c-a987-8ca4f373875f","block_type":"box","text":"identification number, and (ii) a financial intermediary or a shareholder that is an entity be domiciled in the United","page_number":143,"box":{"x":70,"y":513,"width":809,"height":11}},{"id":"82d4e2a7-0d03-44d2-a03c-aa5119044af1","block_type":"box","text":"States and have a valid U.S. taxpayer identification number or be domiciled in a U.S. territory and have a valid U.S.","page_number":143,"box":{"x":69,"y":528,"width":819,"height":12}},{"id":"25cd7a48-29e7-475b-9609-ab724c1fdf01","block_type":"box","text":"taxpayer identification number or IRS Form W-8. Any existing account that is updated to reflect a non-U.S. address will","page_number":143,"box":{"x":68,"y":543,"width":840,"height":12}},{"id":"1148196c-857e-4097-8893-e2e1863ee699","block_type":"box","text":"also be restricted from making additional investments.","page_number":143,"box":{"x":69,"y":559,"width":388,"height":11}},{"id":"2832d890-1fbe-4bc9-858a-1d65a0a97d24","block_type":"box","text":"In-Kind Purchases","page_number":143,"box":{"x":102,"y":582,"width":127,"height":8}},{"id":"710f4398-cdf4-4e5e-ab14-9546e0749273","block_type":"box","text":". Payment for shares of a Fund may, at the discretion of BlackRock, be made in the form of","page_number":143,"box":{"x":230,"y":581,"width":649,"height":11}},{"id":"28135c1f-26e8-42c1-b63a-7226dc48b345","block_type":"box","text":"securities that are permissible investments for the Fund and that meet the investment objective, policies and","page_number":143,"box":{"x":69,"y":596,"width":779,"height":12}},{"id":"b0c49bc5-c813-40b9-8124-f7e5ff3d871a","block_type":"box","text":"limitations of the Fund as described herein. In connection with an in-kind securities payment, the Fund may require,","page_number":143,"box":{"x":70,"y":612,"width":820,"height":11}},{"id":"7e6b80e9-19a2-44c3-86c2-78a27c77471a","block_type":"box","text":"among other things, that the securities: (i) be valued on the day of purchase in accordance with the pricing methods","page_number":143,"box":{"x":69,"y":627,"width":827,"height":11}},{"id":"bb267ef5-c82a-47df-8fa8-85780ee03e1a","block_type":"box","text":"used by the Fund; (ii) be accompanied by satisfactory assurance that the Fund will have good and marketable title to","page_number":143,"box":{"x":69,"y":642,"width":831,"height":11}},{"id":"3437dc63-8691-44f8-a1e1-c0bc9212084d","block_type":"box","text":"such securities; (iii) not be subject to any restrictions upon resale by the Fund; (iv) be in proper form for transfer to","page_number":143,"box":{"x":69,"y":657,"width":817,"height":11}},{"id":"a0e89486-fe9f-4dab-89e2-015f0d0c4820","block_type":"box","text":"the Fund; and (v) be accompanied by adequate information concerning the basis and other tax matters relating to the","page_number":143,"box":{"x":68,"y":672,"width":837,"height":11}},{"id":"8533dab5-24b3-4e13-8f43-a7eaa4a8c55d","block_type":"box","text":"securities. All dividends, interest, subscription or other rights per taining to such securities shall become the proper ty","page_number":143,"box":{"x":69,"y":687,"width":835,"height":11}},{"id":"6c90d678-0edb-4cc5-97e6-c45d5b88ba1a","block_type":"box","text":"of the Fund engaged in the in-kind purchase transaction and must be delivered to the Fund by the investor upon","page_number":143,"box":{"x":69,"y":702,"width":795,"height":12}},{"id":"836b4b0a-00fc-4bd2-834c-017edb2773e3","block_type":"box","text":"receipt from the issuer. Shares purchased in exchange for securities generally cannot be redeemed until the transfer","page_number":143,"box":{"x":69,"y":717,"width":833,"height":12}},{"id":"8995176a-4ee0-4485-9af6-59783a8aaeb0","block_type":"box","text":"has settled.","page_number":143,"box":{"x":69,"y":733,"width":83,"height":9}},{"id":"2d142a8c-524c-4aa9-8b23-5b0474a13fb4","block_type":"box","text":"Institutional Shares","page_number":143,"box":{"x":69,"y":763,"width":142,"height":9}},{"id":"3993b6a9-aef7-4cb0-86cb-a50d0305bc3e","block_type":"box","text":"Institutional Shares may be purchased at NAV without a sales charge. Only cer tain investors are eligible to","page_number":143,"box":{"x":102,"y":786,"width":759,"height":11}},{"id":"bbe7b278-aa90-421c-b16a-d5489a35da70","block_type":"box","text":"purchase Institutional Shares. Investors who are eligible to purchase Institutional Shares should purchase","page_number":143,"box":{"x":70,"y":801,"width":756,"height":11}},{"id":"4f7f6ca1-715d-4ab5-b009-c750444c944a","block_type":"box","text":"Institutional Shares because they are not subject to any sales charge and have lower ongoing expenses than","page_number":143,"box":{"x":70,"y":816,"width":775,"height":11}},{"id":"6a1d0e81-02e8-4741-bfb6-a4ac7620352c","block_type":"box","text":"Investor A, Investor A1, Investor C, Investor P, Class R or Service Shares. A Fund may in its discretion waive or modify","page_number":143,"box":{"x":70,"y":831,"width":839,"height":11}},{"id":"d46fdebd-d230-4871-b4d7-e5ed8a769de4","block_type":"box","text":"any minimum investment amount, may reject any order for any class of shares and may suspend and resume the","page_number":143,"box":{"x":69,"y":846,"width":807,"height":11}},{"id":"9db389dd-ea76-48fe-a307-8a428ace90af","block_type":"box","text":"sale of shares of any Fund at any time.","page_number":143,"box":{"x":69,"y":861,"width":276,"height":11}},{"id":"c25bc612-dfde-46bb-8c0b-9c43bb92884f","block_type":"box","text":"Eligible Institutional Share Investors.","page_number":143,"box":{"x":102,"y":884,"width":259,"height":11}},{"id":"420d9fd5-7f03-46b9-86c0-c4e1d48665c3","block_type":"box","text":"Institutional Shares of the Funds may be purchased by customers of broker","page_number":143,"box":{"x":369,"y":884,"width":540,"height":11}},{"id":"44620df4-282a-4561-b6b5-cf274f43e215","block_type":"box","text":"dealers and agents that have established a servicing relationship with the Fund on behalf of their customers. These","page_number":143,"box":{"x":69,"y":899,"width":826,"height":11}},{"id":"898daf4f-e0e1-4282-b963-be1b5abcdb3e","block_type":"box","text":"II-99","page_number":143,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"c9f4cdcb-ee6e-4059-ae2b-4fa344089992","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":143,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"b68b50a5-49fc-446d-b032-6310cc396072","block_type":"box","text":"broker-dealers and agents may impose additional or different conditions on the purchase or redemption of Fund","page_number":144,"box":{"x":69,"y":45,"width":796,"height":11}},{"id":"a6c3c8f2-7fa5-4420-89f3-e40c96190c12","block_type":"box","text":"shares by their customers and may charge their customers transaction, account or other fees on the purchase and","page_number":144,"box":{"x":69,"y":60,"width":819,"height":11}},{"id":"ec8fe1b2-1e18-4ee7-9301-220b02ee99c0","block_type":"box","text":"redemption of Fund shares. Each broker-dealer or agent is responsible for transmitting to its customers a schedule of","page_number":144,"box":{"x":69,"y":75,"width":840,"height":11}},{"id":"4c69d4bf-910a-4222-8d00-406b80e3108e","block_type":"box","text":"any such fees and information regarding any additional or different conditions regarding purchases and redemptions.","page_number":144,"box":{"x":69,"y":90,"width":833,"height":11}},{"id":"04a977b2-7bc5-4110-ae63-07d8d3a234ea","block_type":"box","text":"Shareholders who are customers of such broker-dealers or agents should consult them for information regarding","page_number":144,"box":{"x":69,"y":105,"width":802,"height":11}},{"id":"1a13e828-bf15-4f18-bee7-661b5800c761","block_type":"box","text":"these fees and conditions.","page_number":144,"box":{"x":68,"y":120,"width":189,"height":9}},{"id":"d77b1bc4-7287-463a-987d-c31f96a94c60","block_type":"box","text":"Payment for Institutional Shares must normally be made in Federal funds or other funds immediately available by","page_number":144,"box":{"x":102,"y":143,"width":805,"height":11}},{"id":"89cb6479-c8e2-4eec-818c-810c8e0196b2","block_type":"box","text":"4 p.m. (Eastern time) on the first business day following receipt of the order. Payment may also, in the discretion of","page_number":144,"box":{"x":69,"y":158,"width":825,"height":11}},{"id":"1dfcea5c-0578-4f19-9aeb-fa0849cfe8df","block_type":"box","text":"cer tain Funds, be made in the form of securities that are permissible investments for such Funds. If payment for a","page_number":144,"box":{"x":69,"y":173,"width":817,"height":11}},{"id":"3a1645ed-0f7b-400c-b963-b9e69be2862e","block_type":"box","text":"purchase order is not received by the prescribed time, an investor may be liable for any resulting losses or expenses","page_number":144,"box":{"x":70,"y":188,"width":831,"height":12}},{"id":"ebbeddee-98ca-4391-8246-71e4efb3d387","block_type":"box","text":"incurred by the Fund.","page_number":144,"box":{"x":70,"y":204,"width":147,"height":11}},{"id":"815bf622-f221-4933-9e65-483b14b89f8f","block_type":"box","text":"Cer tain of the Funds offer Institutional Shares as described in each such Fund’s Prospectus. In addition, the","page_number":144,"box":{"x":102,"y":226,"width":774,"height":11}},{"id":"6ec6a608-91fe-4a14-b200-ff2d440c1de2","block_type":"box","text":"following investors may purchase Institutional Shares: employees, officers and directors/trustees of BlackRock, Inc.,","page_number":144,"box":{"x":68,"y":241,"width":834,"height":11}},{"id":"5c2e4c95-6b65-4b5a-b35e-9497621e478a","block_type":"box","text":"BlackRock Funds, Bank of America Corporation (“BofA Corp.”), Barclays PLC or their respective affiliates and","page_number":144,"box":{"x":70,"y":256,"width":773,"height":11}},{"id":"41a0b0ba-2957-44c9-8e36-c7bf6b954b18","block_type":"box","text":"immediate family members of such persons, individuals and “Institutional Investors” with a minimum initial","page_number":144,"box":{"x":70,"y":271,"width":762,"height":12}},{"id":"0d947767-3a5b-4e87-bb47-b5dd432f2d20","block_type":"box","text":"investment of $2 million who may purchase shares of a Fund through a financial intermediary that has entered into","page_number":144,"box":{"x":70,"y":286,"width":821,"height":12}},{"id":"f2fd2f80-0e83-411f-9d43-f0eae7fc14c9","block_type":"box","text":"an agreement with the Distributor to purchase such shares (“Institutional Investors” include, but are not limited to,","page_number":144,"box":{"x":69,"y":302,"width":819,"height":11}},{"id":"b70ce322-1ab8-44c0-9be2-0a1a5ff676fb","block_type":"box","text":"endowments, foundations, family offices, local, city, and state governmental institutions, corporations, and insurance","page_number":144,"box":{"x":69,"y":317,"width":836,"height":11}},{"id":"4780379d-8124-45cc-b722-2add2b58da0e","block_type":"box","text":"company separate accounts); employer-sponsored retirement plans (which, for this purpose, do not include SEP IRAs,","page_number":144,"box":{"x":69,"y":332,"width":837,"height":11}},{"id":"b634eb3a-72c6-4a00-a75e-8db9d06c58d6","block_type":"box","text":"SIMPLE IRAs or SARSEPs), state sponsored 529 college savings plans, collective trust funds, investment companies","page_number":144,"box":{"x":69,"y":347,"width":832,"height":11}},{"id":"953f8948-0060-43f0-ad80-be142a1f692e","block_type":"box","text":"or other pooled investment vehicles, unaffiliated thrifts and unaffiliated banks and trust companies, each of which","page_number":144,"box":{"x":69,"y":362,"width":815,"height":11}},{"id":"ad282ce9-8269-4b42-8b82-9d0ee7e1cabe","block_type":"box","text":"may purchase shares of the Fund through a financial intermediary that has entered into an agreement with the","page_number":144,"box":{"x":69,"y":377,"width":789,"height":12}},{"id":"6d47a2c9-6090-4022-bd8c-f24784460081","block_type":"box","text":"Distributor to purchase such shares; clients investing through a self-directed IRA brokerage account program","page_number":144,"box":{"x":70,"y":392,"width":772,"height":12}},{"id":"6c8c71c5-18e6-4e7e-a08e-66baf8e49718","block_type":"box","text":"sponsored by a retirement plan record-keeper, provided that such program offers only mutual fund options and that","page_number":144,"box":{"x":69,"y":407,"width":822,"height":12}},{"id":"3567dada-2f02-4fb5-a798-eba2e9d01846","block_type":"box","text":"the program maintains an account with the Fund on an omnibus basis; clients of financial intermediaries that:","page_number":144,"box":{"x":68,"y":423,"width":783,"height":11}},{"id":"de1d0d10-32c4-4a45-bf22-10d7bc959b7d","block_type":"box","text":"(i) charge such clients a fee for advisory, investment consulting, or similar services or (ii) have entered into an","page_number":144,"box":{"x":69,"y":438,"width":785,"height":11}},{"id":"a4a680ed-c1a7-4fa1-be1a-02f34423090f","block_type":"box","text":"agreement with the Distributor to offer Institutional Shares through a no-load program or investment platform, in each","page_number":144,"box":{"x":69,"y":453,"width":838,"height":11}},{"id":"b8df3e57-488c-4a21-b00e-729eeb509664","block_type":"box","text":"case, with no minimum initial investment; clients investing through financial intermediaries that have entered into an","page_number":144,"box":{"x":69,"y":468,"width":831,"height":11}},{"id":"cde6dfe7-a731-4519-807c-7edb246f8de8","block_type":"box","text":"agreement with the Distributor to offer such shares on a platform that charges a transaction based sales","page_number":144,"box":{"x":69,"y":483,"width":751,"height":11}},{"id":"59fb62f2-9b3c-4611-b61c-b3d9bccaec98","block_type":"box","text":"commission outside of the Fund, with a minimum initial investment of $1,000; tax-qualified accounts for insurance","page_number":144,"box":{"x":69,"y":498,"width":817,"height":11}},{"id":"08d2626f-427c-41b4-8089-ccf17a90e3a4","block_type":"box","text":"agents that are registered representatives of an insurance company’s broker-dealer that has entered into an","page_number":144,"box":{"x":69,"y":513,"width":773,"height":12}},{"id":"0b41055b-1461-4900-b6eb-422d006c405a","block_type":"box","text":"agreement with the Distributor to offer Institutional Shares, and the family members of such persons, with a","page_number":144,"box":{"x":69,"y":528,"width":771,"height":12}},{"id":"a923deb3-7863-481d-a269-1721d6df7215","block_type":"box","text":"minimum initial investment of $1,000; trust depar tment clients of Bank of America, N.A. and its affiliates for whom","page_number":144,"box":{"x":69,"y":543,"width":822,"height":11}},{"id":"d0e2e695-ebcf-4d2e-a4b6-4e5f2f877e60","block_type":"box","text":"they (i) act in a fiduciary capacity (excluding par ticipant directed employee benefit plans), (ii) otherwise have","page_number":144,"box":{"x":68,"y":559,"width":771,"height":11}},{"id":"8d962333-0287-4623-84f1-52af4797fe8d","block_type":"box","text":"investment discretion, or (iii) act as custodian for at least $2 million in assets; and holders of cer tain BofA Corp.","page_number":144,"box":{"x":70,"y":573,"width":801,"height":12}},{"id":"3bdea5bd-14e4-46d9-9d0a-c9c29e8621c4","block_type":"box","text":"sponsored unit investment trusts (UITs) who reinvest dividends received from such UITs in shares of a Fund.","page_number":144,"box":{"x":69,"y":589,"width":770,"height":11}},{"id":"c69a9f77-f6ce-45f6-bdb7-872c3b54bfd3","block_type":"box","text":"Purchase Privileges of Cer tain Persons.","page_number":144,"box":{"x":102,"y":612,"width":280,"height":11}},{"id":"e81a4d7e-c287-46fb-9e4c-eac6e1621c47","block_type":"box","text":"Employees, officers, directors/trustees of BlackRock, Inc., BlackRock","page_number":144,"box":{"x":389,"y":612,"width":496,"height":11}},{"id":"46f94f09-3b0f-4a12-9b4b-9f7e9b1cf76c","block_type":"box","text":"Funds, BofA Corp. or their respective affiliates; and any trust, pension, profit-sharing or other benefit plan for such","page_number":144,"box":{"x":70,"y":627,"width":812,"height":11}},{"id":"3ee9ef1b-084f-444b-a922-2d967f72c6a4","block_type":"box","text":"persons may purchase Institutional Shares at lower investment minimums than stated in each Fund’s Prospectus. A","page_number":144,"box":{"x":70,"y":642,"width":828,"height":11}},{"id":"285b5fd8-2754-432b-99e9-81eeb6846d0e","block_type":"box","text":"Fund realizes economies of scale and reduction of sales-related expenses by vir tue of the familiarity of these persons","page_number":144,"box":{"x":70,"y":657,"width":838,"height":11}},{"id":"a5213865-4e87-4089-8eaa-5c401b828b23","block_type":"box","text":"with the Fund. Employees, directors, and board members of other funds wishing to purchase shares of a Fund must","page_number":144,"box":{"x":68,"y":672,"width":826,"height":11}},{"id":"e2e33d89-a564-4fd4-85a8-8bc2aec95c86","block_type":"box","text":"satisfy the Fund’s suitability standards.","page_number":144,"box":{"x":69,"y":687,"width":279,"height":11}},{"id":"66933b07-3d23-4305-bea5-9e2d96644ca1","block_type":"box","text":"Initial Sales Charge Alternative — Investor A Shares","page_number":144,"box":{"x":69,"y":718,"width":382,"height":11}},{"id":"5ada1b22-65b3-4663-87ff-8152663ff18b","block_type":"box","text":"Investors who prefer an initial sales charge alternative may elect to purchase Investor A Shares. Investor A1","page_number":144,"box":{"x":102,"y":740,"width":770,"height":11}},{"id":"4e8faa72-ab7e-4255-be7e-aa79322a837e","block_type":"box","text":"Shares are offered only (i) for purchase by cer tain employer-sponsored retirement plans and fee-based programs that","page_number":144,"box":{"x":69,"y":755,"width":837,"height":11}},{"id":"ee2d6f37-4104-454e-85bd-feb64fe18239","block_type":"box","text":"have been previously approved by cer tain Funds, and (ii) to cer tain investors who currently hold Investor A1 Shares","page_number":144,"box":{"x":69,"y":770,"width":819,"height":11}},{"id":"df233bb1-dc62-4225-8d0c-5b261bb2d088","block_type":"box","text":"for dividend and capital gain reinvestment only. The Investor A1 initial sales charge does not apply to the transactions","page_number":144,"box":{"x":68,"y":785,"width":840,"height":12}},{"id":"7cf3fa9f-4d47-4675-85fd-4920255c90c1","block_type":"box","text":"described in (i) and (ii). For ease of reference, Investor A, Investor A1 and Investor P (discussed below) Shares are","page_number":144,"box":{"x":69,"y":801,"width":815,"height":11}},{"id":"b7755d01-5b42-497a-880c-1fb8e389b664","block_type":"box","text":"sometimes referred to herein as “front-end load shares.” Investor A Shares of Index Funds (defined below) and","page_number":144,"box":{"x":69,"y":816,"width":791,"height":11}},{"id":"319cf184-df6a-4367-8c86-eb860e695455","block_type":"box","text":"BlackRock Shor t Obligations Fund generally are not subject to an initial sales charge or front-end load.","page_number":144,"box":{"x":70,"y":831,"width":727,"height":11}},{"id":"f9a27f08-5356-4905-b72a-2204a680c11c","block_type":"box","text":"Investors qualifying for significantly reduced initial sales charges may find the initial sales charge alternative","page_number":144,"box":{"x":102,"y":853,"width":770,"height":12}},{"id":"3ad51907-209c-4978-b0b8-b36c7e817a30","block_type":"box","text":"par ticularly attractive because similar sales charge reductions are not available with respect to the deferred sales","page_number":144,"box":{"x":70,"y":869,"width":812,"height":11}},{"id":"9cee3797-286e-4c50-82f3-6917b0fb8589","block_type":"box","text":"charges imposed in connection with investments in Investor C Shares (sometimes referred to herein as “CDSC","page_number":144,"box":{"x":69,"y":884,"width":791,"height":11}},{"id":"feab4fc9-fd7e-474b-af86-e4b460d8e74d","block_type":"box","text":"shares”). Investors who do not qualify for reduced initial sales charges and who expect to maintain their investment","page_number":144,"box":{"x":69,"y":899,"width":826,"height":11}},{"id":"cee408dd-11ab-4ac3-a3de-8aa30bef5ecc","block_type":"box","text":"II-100","page_number":144,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"5e7c1751-712f-4d0b-9232-44822b4fc0c7","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":144,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"17e4e1dc-b978-431b-b974-cc88822ef689","block_type":"box","text":"for an extended period of time also may elect to purchase Investor A Shares, because over time the accumulated","page_number":145,"box":{"x":68,"y":45,"width":808,"height":11}},{"id":"083a696b-5187-49cb-8a61-1ec0ade275e8","block_type":"box","text":"ongoing service and distribution fees on CDSC shares may exceed the front-end load shares’ initial sales charge and","page_number":145,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"0c611673-d592-4efd-a2b6-d734a91b0ec3","block_type":"box","text":"service fee. Although some investors who previously purchased Institutional Shares may no longer be eligible to","page_number":145,"box":{"x":69,"y":75,"width":798,"height":11}},{"id":"8dc8d1f5-564d-4442-8e9d-f741d8e1052c","block_type":"box","text":"purchase Institutional Shares of other Funds, those previously purchased Institutional Shares, together with all","page_number":145,"box":{"x":70,"y":90,"width":789,"height":11}},{"id":"f12914bf-a00c-4806-b81e-a78947ca7577","block_type":"box","text":"BlackRock front-end load and CDSC share holdings, will count toward a right of accumulation that may qualify the","page_number":145,"box":{"x":70,"y":105,"width":805,"height":11}},{"id":"fce06481-4322-4271-806e-33ad3a0a153f","block_type":"box","text":"investor for a reduced initial sales charge on new initial sales charge purchases. In addition, the ongoing CDSC","page_number":145,"box":{"x":70,"y":120,"width":792,"height":12}},{"id":"9b48fea2-720a-4f01-bbfe-ed78c86b6b12","block_type":"box","text":"shares service and distribution fees will cause CDSC shares to have higher expense ratios, pay lower dividends and","page_number":145,"box":{"x":69,"y":135,"width":826,"height":12}},{"id":"8da052dd-8534-41a6-9d2c-f98ed4c96955","block_type":"box","text":"have lower total returns than the initial sales charge shares. The ongoing front-end load shares’ service fees will","page_number":145,"box":{"x":69,"y":150,"width":802,"height":12}},{"id":"6c52ff3f-8f30-4afe-b032-4360cf579eda","block_type":"box","text":"cause Investor A, Investor A1, Investor P and Service Shares to have a higher expense ratio, pay lower dividends and","page_number":145,"box":{"x":69,"y":166,"width":834,"height":11}},{"id":"58dc3557-d404-4842-a132-be6b4f316bf8","block_type":"box","text":"have a lower total return than Institutional Shares.","page_number":145,"box":{"x":69,"y":181,"width":358,"height":9}},{"id":"df5ce655-780b-4e39-ae61-2730df9b7944","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Par t I of each Fund’s SAI for","page_number":145,"box":{"x":102,"y":203,"width":734,"height":12}},{"id":"6fb846a8-d444-43d4-a6c7-0ffa18b68a5d","block_type":"box","text":"information about amounts paid to the Distributor in connection with Investor A and Investor A1 Shares for the","page_number":145,"box":{"x":70,"y":218,"width":785,"height":11}},{"id":"d4d8aab8-5e8b-483f-b9ab-841589f884f0","block_type":"box","text":"periods indicated.","page_number":145,"box":{"x":70,"y":234,"width":124,"height":11}},{"id":"cc760941-6f61-4b18-ba45-d0659adc578f","block_type":"box","text":"The Distributor may reallow discounts to selected securities dealers and other financial intermediaries and retain","page_number":145,"box":{"x":101,"y":256,"width":806,"height":11}},{"id":"e834810d-d10c-4f7c-9201-618a8f2c9a5f","block_type":"box","text":"the balance over such discounts. At times the Distributor may reallow the entire sales charge to such dealers. Since","page_number":145,"box":{"x":68,"y":272,"width":830,"height":11}},{"id":"5d844138-92f5-411d-adb5-86751ce6a11d","block_type":"box","text":"securities dealers and other financial intermediaries selling front-end load shares of a Fund will receive a concession","page_number":145,"box":{"x":69,"y":286,"width":832,"height":12}},{"id":"c6c3b882-7138-4cbb-9c63-93ea276220b6","block_type":"box","text":"equal to most of the sales charge, they may be deemed to be underwriters under the Securities Act.","page_number":145,"box":{"x":69,"y":302,"width":714,"height":11}},{"id":"e409d78a-b348-43b7-83e7-7ad01035ecb8","block_type":"box","text":"Initial Sales Charge — Investor P Shares","page_number":145,"box":{"x":69,"y":332,"width":297,"height":11}},{"id":"ef2bf886-51c2-4601-b458-49edbc90bb82","block_type":"box","text":"Cer tain Funds offer Investor P Shares as described in each such Fund’s Prospectus, Investor P Shares are","page_number":145,"box":{"x":102,"y":355,"width":761,"height":11}},{"id":"9c81625f-c68f-4b85-b63c-745662375396","block_type":"box","text":"available for purchase only through registered representatives of an insurance company’s broker-dealer that has","page_number":145,"box":{"x":69,"y":370,"width":800,"height":11}},{"id":"d5564135-4ead-42ee-b64d-b5d6bfbcc48b","block_type":"box","text":"entered into an agreement with the Distributor to offer such shares and are subject to an initial sales charge. The","page_number":145,"box":{"x":69,"y":385,"width":812,"height":11}},{"id":"512e09cc-9817-41f3-8174-c376885dbda3","block_type":"box","text":"ongoing front-end load shares’ service fees will cause Investor P Shares to have a higher expense ratio, pay lower","page_number":145,"box":{"x":69,"y":400,"width":813,"height":11}},{"id":"0e41da6d-494d-4354-9a83-8b74fcb03476","block_type":"box","text":"dividends and have a lower total return than Investor A Shares of the same Fund.","page_number":145,"box":{"x":69,"y":415,"width":578,"height":9}},{"id":"02e86f3b-bd0b-4e9e-be03-3a7018b01fff","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Par t I of each Fund’s SAI for","page_number":145,"box":{"x":102,"y":438,"width":734,"height":11}},{"id":"b20f962e-3020-457c-ba8d-7e5fe5b8425f","block_type":"box","text":"information about amounts paid to the Distributor in connection with Investor P Shares for the periods indicated.","page_number":145,"box":{"x":70,"y":453,"width":800,"height":11}},{"id":"01726e6f-4813-4bf6-a0c2-09785a5ac1ed","block_type":"box","text":"The Distributor may reallow discounts to selected securities dealers and other financial intermediaries and retain","page_number":145,"box":{"x":101,"y":475,"width":806,"height":12}},{"id":"35cdba41-dcb3-4285-9702-6baf6b666a8f","block_type":"box","text":"the balance over such discounts. At times the Distributor may reallow the entire sales charge to such dealers. Since","page_number":145,"box":{"x":68,"y":491,"width":830,"height":11}},{"id":"9bccafb0-1ba6-4175-a41f-a58319834bc7","block_type":"box","text":"securities dealers and other financial intermediaries selling front-end load shares of a Fund will receive a concession","page_number":145,"box":{"x":69,"y":506,"width":832,"height":11}},{"id":"db4d0493-462e-4336-957b-76b5ccc0e025","block_type":"box","text":"equal to most of the sales charge, they may be deemed to be underwriters under the Securities Act.","page_number":145,"box":{"x":69,"y":521,"width":714,"height":11}},{"id":"a581f637-3596-4381-9e8c-2b7be6e99cd3","block_type":"box","text":"Reduced Initial Sales Charges","page_number":145,"box":{"x":69,"y":551,"width":219,"height":11}},{"id":"fad4ad7a-1231-40ca-a823-afffae03b994","block_type":"box","text":"Cer tain investors may be eligible for a reduction in or waiver of a sales load due to the nature of the investors","page_number":145,"box":{"x":102,"y":574,"width":782,"height":11}},{"id":"87bce875-5414-41df-b285-af1abdc2eb77","block_type":"box","text":"and/or the reduced sales effor ts necessary to obtain their investments. Financial intermediaries may, in connection","page_number":145,"box":{"x":69,"y":589,"width":827,"height":11}},{"id":"ecf055ce-b059-4eb6-92a4-d863728ab998","block_type":"box","text":"with a change in account type or otherwise in accordance with a financial intermediary’s policies and procedures,","page_number":145,"box":{"x":68,"y":604,"width":809,"height":11}},{"id":"319b46d8-4e9e-47b0-af04-d982b38a05cb","block_type":"box","text":"exchange shares of a Fund from one class of shares to another class of shares of the same Fund provided that the","page_number":145,"box":{"x":69,"y":619,"width":823,"height":11}},{"id":"d84fca3b-3fc6-46b3-8c9a-070d74971b93","block_type":"box","text":"exchanged shares are not subject to a contingent deferred sales charge and that shareholders meet the eligibility","page_number":145,"box":{"x":69,"y":634,"width":812,"height":12}},{"id":"3a8c9f2e-9b3e-4213-9901-1161c0f9d060","block_type":"box","text":"requirements of the new share class. Cer tain sales load reductions and waivers may be available to customers of","page_number":145,"box":{"x":69,"y":649,"width":813,"height":12}},{"id":"b0c144f5-a38d-4b49-b7d4-5e43b6e31961","block_type":"box","text":"cer tain financial intermediaries, as described under “Intermediary-Defined Sales Charge Waiver Policies” in the","page_number":145,"box":{"x":69,"y":664,"width":793,"height":12}},{"id":"c1cc01a7-4339-4648-b5e5-af8f8d54a9dc","block_type":"box","text":"Fund’s Prospectus. Please speak to your financial intermediary for more information.","page_number":145,"box":{"x":70,"y":680,"width":603,"height":11}},{"id":"347fc06d-1efc-42ee-9852-10e277240ffe","block_type":"box","text":"Reinvested Dividends.","page_number":145,"box":{"x":102,"y":703,"width":156,"height":8}},{"id":"a4a2a8c9-23ac-42f3-8a66-bfcd98318ba8","block_type":"box","text":"No sales charges are imposed upon shares issued as a result of the automatic","page_number":145,"box":{"x":265,"y":702,"width":566,"height":12}},{"id":"7b492e97-94c7-4cb2-99e7-09107d604934","block_type":"box","text":"reinvestment of dividends.","page_number":145,"box":{"x":69,"y":717,"width":186,"height":9}},{"id":"169a6916-d47c-400b-8a80-0b727f31d5f0","block_type":"box","text":"Right of Accumulation.","page_number":145,"box":{"x":102,"y":740,"width":158,"height":11}},{"id":"5b02430a-9200-4777-9cee-ed2ca7ce60b4","block_type":"box","text":"Investors have a “right of accumulation” under which any of the following may be","page_number":145,"box":{"x":267,"y":740,"width":574,"height":11}},{"id":"9472ff6b-f4a6-4212-a880-08730a2bdb40","block_type":"box","text":"combined with the amount of the current purchase in determining whether an investor qualifies for a breakpoint and","page_number":145,"box":{"x":69,"y":755,"width":826,"height":11}},{"id":"2a78db67-e5cf-42d6-820c-6a248554877a","block_type":"box","text":"a reduced front-end sales charge: (i) the current value of an investor’s existing Investor A, Investor A1, Investor C,","page_number":145,"box":{"x":69,"y":770,"width":810,"height":12}},{"id":"ac1bdbd4-01c1-43b8-b8fc-ed2721b6571f","block_type":"box","text":"Investor P, Institutional, Class K and Premier Shares in most BlackRock Funds, (ii) the current value of an investor’s","page_number":145,"box":{"x":70,"y":785,"width":825,"height":11}},{"id":"ed713391-8bdf-495b-81b6-45dccf9e1935","block_type":"box","text":"existing shares of cer tain unlisted closed-end management investment companies sponsored and advised by","page_number":145,"box":{"x":69,"y":801,"width":780,"height":11}},{"id":"54b8efb4-efaa-49ed-8a10-786782f4e689","block_type":"box","text":"BlackRock or its affiliates (“Eligible Unlisted BlackRock Closed-End Funds”) and (iii) the investment in the BlackRock","page_number":145,"box":{"x":70,"y":816,"width":828,"height":11}},{"id":"150dcfa7-395e-40a5-ae13-7b5c442e3cd0","block_type":"box","text":"CollegeAdvantage 529 Program by the investor or by or on behalf of the investor’s spouse and children. Financial","page_number":145,"box":{"x":69,"y":831,"width":804,"height":11}},{"id":"3ada3306-560c-46a9-b610-c75536eccdbd","block_type":"box","text":"intermediaries may value current holdings of their customers differently for purposes of determining whether an","page_number":145,"box":{"x":70,"y":846,"width":794,"height":11}},{"id":"1071247a-647d-46be-bd8b-8cbb536b8222","block_type":"box","text":"investor qualifies for a breakpoint and a reduced front-end sales charge, although customers of the same financial","page_number":145,"box":{"x":70,"y":861,"width":814,"height":11}},{"id":"14be9a26-e8d8-4ba8-9959-9610bbad7885","block_type":"box","text":"intermediary will be treated similarly. In order to use this right, the investor must aler t BlackRock to the existence of","page_number":145,"box":{"x":70,"y":876,"width":828,"height":11}},{"id":"d70b6221-06f5-40e4-ae71-9fb9c77528cd","block_type":"box","text":"any previously purchased shares. Cer tain funds employ a “passive” management approach and attempt to match the","page_number":145,"box":{"x":69,"y":891,"width":838,"height":12}},{"id":"c0478f69-e64a-4edf-8fc5-2605035c744b","block_type":"box","text":"per formance of a target index as closely as possible before the deduction of Fund expenses (“Index Funds”).","page_number":145,"box":{"x":70,"y":906,"width":776,"height":12}},{"id":"41f1620c-9bf3-4f34-9fc5-edb7720b5bbd","block_type":"box","text":"II-101","page_number":145,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"c62cf842-7991-4040-afd6-32e9f9e5b116","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":145,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"2a6da909-ebc2-4b29-b601-11b5c7b4bcb3","block_type":"box","text":"Although Investor A Shares of Index Funds and BlackRock Shor t Obligations Fund generally are not subject to a sales","page_number":146,"box":{"x":68,"y":45,"width":835,"height":11}},{"id":"3fdc2a92-33d7-4a83-9496-80ac689a92b8","block_type":"box","text":"charge, an investor’s existing Investor A, Investor A1, Investor C, Investor P, Institutional, Class K and Premier Shares","page_number":146,"box":{"x":69,"y":60,"width":839,"height":11}},{"id":"eb69da82-2fe4-421c-a942-0f9a4639bdc0","block_type":"box","text":"in the Index Funds and BlackRock Shor t Obligations Fund may be combined with the amount of an investor’s current","page_number":146,"box":{"x":70,"y":75,"width":829,"height":11}},{"id":"677e015a-5857-4247-ad80-4c13ff35de8c","block_type":"box","text":"purchase in determining whether an investor qualifies for a breakpoint and a reduced front-end sales charge.","page_number":146,"box":{"x":70,"y":90,"width":774,"height":11}},{"id":"4aa1f38a-b97d-4fad-9349-e2da3cd49881","block_type":"box","text":"Letter of Intent.","page_number":146,"box":{"x":102,"y":113,"width":109,"height":9}},{"id":"2e83ccad-8feb-4654-8b76-073f31a55f48","block_type":"box","text":"An investor may qualify for a reduced front-end sales charge immediately by signing a “Letter of","page_number":146,"box":{"x":217,"y":113,"width":681,"height":11}},{"id":"826a7873-a5c3-4913-8bcd-1232b40c7cf7","block_type":"box","text":"Intent” stating the investor’s intention to make one or more of the following investments within the next 13 months","page_number":146,"box":{"x":70,"y":128,"width":820,"height":11}},{"id":"f7373f41-2e8f-4f2c-a6f0-ef95389b6e9e","block_type":"box","text":"which would, if bought all at once, qualify the investor for a reduced sales charge: (i) buy a specified amount of","page_number":146,"box":{"x":68,"y":143,"width":792,"height":11}},{"id":"a362ff13-6299-46b9-bfcb-7a7c94c07bdb","block_type":"box","text":"Investor A, Investor C, Investor P, Institutional, Class K and/or Premier Shares, (ii) make an investment in one or","page_number":146,"box":{"x":70,"y":158,"width":802,"height":11}},{"id":"40f0a7b5-7c6c-4b81-bab9-2d018184b7ec","block_type":"box","text":"more Eligible Unlisted BlackRock Closed-End Funds and/or (iii) make an investment through the BlackRock","page_number":146,"box":{"x":69,"y":173,"width":760,"height":11}},{"id":"501e969b-3b43-4373-99e2-6eda6716ef8a","block_type":"box","text":"CollegeAdvantage 529 Program in one or more BlackRock Funds. The initial investment must meet the minimum","page_number":146,"box":{"x":69,"y":188,"width":800,"height":12}},{"id":"f578c3f7-7160-46e0-870c-497fb327a2f0","block_type":"box","text":"initial purchase requirement. The 13-month Letter of Intent period commences on the day that the Letter of Intent is","page_number":146,"box":{"x":70,"y":203,"width":826,"height":12}},{"id":"444bf66f-239a-492e-8f13-8d55748912cf","block_type":"box","text":"received by the Fund. The market value of current holdings in the BlackRock Funds (including Investor A, Investor C,","page_number":146,"box":{"x":69,"y":218,"width":822,"height":12}},{"id":"980afdf8-8670-4587-ae95-d8091cbb879b","block_type":"box","text":"Investor P, Institutional, Class K and Premier Shares, Eligible Unlisted BlackRock Closed-End Funds and the","page_number":146,"box":{"x":70,"y":234,"width":764,"height":11}},{"id":"08e891bd-9068-4a9a-b8ae-9947785de39d","block_type":"box","text":"BlackRock CollegeAdvantage 529 Program Class A and Class C Units) as of the date of commencement that are","page_number":146,"box":{"x":70,"y":249,"width":800,"height":11}},{"id":"f9ad3309-0509-4907-afb7-e00de039183b","block_type":"box","text":"eligible under the Right of Accumulation may be counted towards the sales charge reduction. The investor must notify","page_number":146,"box":{"x":69,"y":264,"width":838,"height":11}},{"id":"82e585ce-1f35-4760-9404-cdfab4aaac9e","block_type":"box","text":"the Fund of (i) any current holdings in the BlackRock Funds, Eligible Unlisted BlackRock Closed-End Funds and/or the","page_number":146,"box":{"x":68,"y":279,"width":835,"height":11}},{"id":"cdeedc8e-c74e-48a4-85e9-2aaf52744ebe","block_type":"box","text":"BlackRock CollegeAdvantage 529 Program that should be counted towards the sales charge reduction and (ii) any","page_number":146,"box":{"x":70,"y":294,"width":811,"height":11}},{"id":"05da474c-3305-40c5-9ea5-14db860b862f","block_type":"box","text":"subsequent purchases that should be counted towards the Letter of Intent. During the term of the Letter of Intent,","page_number":146,"box":{"x":69,"y":309,"width":814,"height":11}},{"id":"250911f2-b09c-4102-8665-406ea7bda807","block_type":"box","text":"the Fund will hold Investor A Shares and/or Investor P Shares, as applicable, representing up to 5% of the indicated","page_number":146,"box":{"x":68,"y":324,"width":827,"height":12}},{"id":"4bc5ca36-7aaa-4b54-90cc-4ad6bab16d9c","block_type":"box","text":"amount in an escrow account for payment of a higher sales load if the full amount indicated in the Letter of Intent is","page_number":146,"box":{"x":69,"y":339,"width":827,"height":12}},{"id":"c51625ce-3ebf-472e-8e4f-ab84fbf640b9","block_type":"box","text":"not purchased. If the full amount indicated is not purchased within the 13-month period, and the investor does not","page_number":146,"box":{"x":69,"y":355,"width":817,"height":11}},{"id":"c1c7cf4e-c6fe-4a35-9475-231476ef49f1","block_type":"box","text":"pay the higher sales load within 20 days, the Fund will redeem enough of the Investor A Shares and/or Investor P","page_number":146,"box":{"x":70,"y":370,"width":807,"height":11}},{"id":"7cd82c69-597f-41b8-acb7-c80d55670599","block_type":"box","text":"Shares, as applicable, held in escrow to pay the difference.","page_number":146,"box":{"x":69,"y":385,"width":423,"height":11}},{"id":"3cb3b686-8476-4a05-9fa7-a203a0271de3","block_type":"box","text":"Placement Fees.","page_number":146,"box":{"x":102,"y":408,"width":116,"height":8}},{"id":"2ef5f237-a9df-4dbc-9fc2-ba78a33c7038","block_type":"box","text":"BlackRock may pay placement fees to dealers on purchases of Investor A and Investor P Shares of all Funds,","page_number":146,"box":{"x":102,"y":430,"width":777,"height":11}},{"id":"9b250a4b-71a0-495a-b3ab-d1ce12544744","block_type":"box","text":"which may depend on the policies, procedures and trading platforms of your financial intermediary.","page_number":146,"box":{"x":68,"y":445,"width":704,"height":12}},{"id":"3f548825-e7c6-44cb-b8dc-d5744ca76b5c","block_type":"box","text":"Except as noted below, these placement fees may be up to the following amounts for Investor A Shares:","page_number":146,"box":{"x":102,"y":468,"width":741,"height":11}},{"id":"1f00ddec-91fc-4911-9e19-94bb28170801","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":146,"box":{"x":167,"y":495,"width":361,"height":10}},{"id":"6e7a7a33-f2d6-459a-b5e9-1e231fc3625f","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.00%","page_number":146,"box":{"x":535,"y":496,"width":288,"height":9}},{"id":"3e25049b-5387-4d06-b922-80eae91726de","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":146,"box":{"x":167,"y":510,"width":361,"height":11}},{"id":"d15757dd-be8d-4e98-83ec-b078060f5ad9","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":146,"box":{"x":535,"y":511,"width":288,"height":9}},{"id":"e8407e87-7189-4a1b-9847-7360f95f2a53","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":146,"box":{"x":167,"y":525,"width":345,"height":11}},{"id":"99d74ced-12be-4dc3-ad87-6745f88c1952","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":146,"box":{"x":518,"y":526,"width":305,"height":9}},{"id":"01d711d3-f7b7-4565-bd16-c45cbb95b323","block_type":"box","text":"With respect to Investor A Shares of BlackRock Global Allocation Fund, Inc., BlackRock Dynamic High Income","page_number":146,"box":{"x":101,"y":550,"width":776,"height":11}},{"id":"2327d594-60cf-4e40-9891-607cb5503056","block_type":"box","text":"Por tfolio (for shares purchased prior to July 1, 2020) and BlackRock Multi-Asset Income Por tfolio (for shares","page_number":146,"box":{"x":69,"y":565,"width":774,"height":11}},{"id":"5496fac7-289f-43ab-8b92-bd4d58ccbc1a","block_type":"box","text":"purchased prior to July 1, 2020) of BlackRock Funds II, BlackRock Credit Relative Value Fund of BlackRock Funds IV","page_number":146,"box":{"x":70,"y":580,"width":824,"height":11}},{"id":"55a4d507-f624-4178-aa75-efcaf7ba5eb5","block_type":"box","text":"and BlackRock Event Driven Equity Fund, the placement fees may be up to the following amounts:","page_number":146,"box":{"x":69,"y":595,"width":695,"height":11}},{"id":"9c620418-eb8a-45a1-8873-5c3f65088710","block_type":"box","text":"$250,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":146,"box":{"x":167,"y":622,"width":410,"height":11}},{"id":"86695651-0672-4292-83b9-53812e30d3c5","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 1.00%","page_number":146,"box":{"x":583,"y":623,"width":240,"height":9}},{"id":"8723a324-534e-44e8-8594-1204e798dbc9","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":146,"box":{"x":167,"y":637,"width":361,"height":11}},{"id":"db1cb291-690b-4563-9082-530569105b5a","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":146,"box":{"x":535,"y":638,"width":288,"height":9}},{"id":"fe775e73-79d6-483e-b533-9b34dfd7a468","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":146,"box":{"x":167,"y":652,"width":345,"height":11}},{"id":"f46bbce7-f53c-4d7a-9cd1-9a58987c5dcf","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":146,"box":{"x":518,"y":653,"width":305,"height":9}},{"id":"e483583e-8444-4759-aa13-9e07e33e4620","block_type":"box","text":"With respect to Investor A Shares of BlackRock Systematic Multi-Strategy Fund of BlackRock Funds IV, BlackRock","page_number":146,"box":{"x":101,"y":677,"width":806,"height":11}},{"id":"88921062-2ab0-488b-9e76-743438a53c8b","block_type":"box","text":"Advantage CoreAlpha Bond Fund of BlackRock Funds VI, BlackRock Tactical Oppor tunities Fund of BlackRock Funds","page_number":146,"box":{"x":68,"y":692,"width":821,"height":11}},{"id":"dc665a65-ae86-41ab-a7a6-c4132102f668","block_type":"box","text":"SM","page_number":146,"box":{"x":890,"y":693,"width":11,"height":4}},{"id":"b7482566-30d8-4468-9f9d-0c680f69f6db","block_type":"box","text":",","page_number":146,"box":{"x":903,"y":700,"width":2,"height":3}},{"id":"2d761842-379e-462f-af84-4c40d14f0591","block_type":"box","text":"BlackRock High Yield Por tfolio, BlackRock Core Bond Por tfolio and BlackRock Sustainable High Yield Bond Fund of","page_number":146,"box":{"x":70,"y":707,"width":816,"height":12}},{"id":"24c710ff-de55-4630-a32e-9291a090c52b","block_type":"box","text":"BlackRock Funds V, BlackRock Securitized Income Fund of Managed Account Series II and BlackRock Strategic Global","page_number":146,"box":{"x":70,"y":722,"width":835,"height":12}},{"id":"fd924329-4fc6-4733-80da-6905768d8ae5","block_type":"box","text":"Bond Fund, Inc., the placement fees may be up to the following amounts:","page_number":146,"box":{"x":70,"y":738,"width":520,"height":11}},{"id":"24ae6ac2-6a88-42f5-945c-1556f4462f37","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":146,"box":{"x":167,"y":765,"width":361,"height":10}},{"id":"adf00464-b9a2-4508-844b-4d5a7c628608","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.75%","page_number":146,"box":{"x":535,"y":765,"width":288,"height":9}},{"id":"3818bca0-696d-4bf0-a5a7-b59162446531","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":146,"box":{"x":167,"y":780,"width":361,"height":10}},{"id":"1d4be540-d5c2-471f-abef-dcb458c3d298","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":146,"box":{"x":535,"y":780,"width":288,"height":9}},{"id":"beb812d8-b485-485e-b255-30a6dab686ba","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":146,"box":{"x":167,"y":795,"width":345,"height":10}},{"id":"6cc7dead-a0f4-44f9-8f6e-3ca583dedeba","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":146,"box":{"x":518,"y":796,"width":305,"height":8}},{"id":"cc8ba98d-5cb3-44c4-8f5a-0bc9f4f85199","block_type":"box","text":"With respect to Investor A Shares of BlackRock Mor tgage-Backed Securities Fund and BlackRock Impact","page_number":146,"box":{"x":101,"y":819,"width":743,"height":12}},{"id":"637be20d-79b1-4f99-b6a7-7f283a408611","block_type":"box","text":"Mor tgage Fund of BlackRock Funds V, the placement fees may be up to the following amounts:","page_number":146,"box":{"x":70,"y":835,"width":674,"height":11}},{"id":"d15491d0-d786-4722-8ec1-c3f5bced9af4","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":146,"box":{"x":167,"y":862,"width":361,"height":10}},{"id":"32088827-f807-4aca-b9b7-d652cc38839c","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":146,"box":{"x":535,"y":862,"width":288,"height":9}},{"id":"8805eb35-d257-4ba7-8aa9-ad39f65e5a42","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":146,"box":{"x":167,"y":877,"width":361,"height":10}},{"id":"f75f44d7-ca04-4cce-a179-f6097829c283","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":146,"box":{"x":535,"y":878,"width":288,"height":8}},{"id":"d134f87e-ec96-49c9-91de-1c0145da4bf2","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":146,"box":{"x":167,"y":892,"width":345,"height":10}},{"id":"a64863ab-9d64-47f2-b82b-882abffdb3ee","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":146,"box":{"x":518,"y":893,"width":305,"height":9}},{"id":"08ed57dd-c77b-4789-8e1c-e5de603b81bf","block_type":"box","text":"II-102","page_number":146,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"34a92a2f-fe63-4fe5-9ef9-3a801557700d","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":146,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"b390632c-d18d-4d6e-a39a-116b4f09f6c3","block_type":"box","text":"With respect to Investor A Shares of BlackRock Managed Income Fund of BlackRock Funds II, the placement fees","page_number":147,"box":{"x":101,"y":45,"width":808,"height":11}},{"id":"d1e60f72-7ec0-474b-97f3-7a9ba4d5e6a1","block_type":"box","text":"may be up to the following amounts:","page_number":147,"box":{"x":69,"y":60,"width":257,"height":11}},{"id":"af1aad12-2785-495f-bf60-f56412da2d0c","block_type":"box","text":"$250,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":147,"box":{"x":167,"y":87,"width":410,"height":11}},{"id":"39933b6e-7fec-494f-a1d0-71a0695d6d21","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":147,"box":{"x":583,"y":88,"width":240,"height":8}},{"id":"e434fef6-f556-4c08-8e44-55bb232fbdd8","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":147,"box":{"x":167,"y":102,"width":361,"height":10}},{"id":"1f5dd220-d66c-4c9c-9ce0-448116844965","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":147,"box":{"x":535,"y":103,"width":288,"height":9}},{"id":"cd5c91da-a861-4836-822a-95a53f1a4176","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":147,"box":{"x":167,"y":117,"width":345,"height":11}},{"id":"93453069-c7e2-40c9-84e3-9e03a8d68296","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":147,"box":{"x":518,"y":118,"width":305,"height":9}},{"id":"58031267-d94f-4ca4-9f9c-66b25b8066ca","block_type":"box","text":"With respect to Investor A Shares of BlackRock Inflation Protected Bond Por tfolio of BlackRock Funds V, the","page_number":147,"box":{"x":101,"y":142,"width":768,"height":11}},{"id":"80cef73a-8bb5-40b9-97a4-394e51096aa2","block_type":"box","text":"placement fees may be up to the following amounts:","page_number":147,"box":{"x":70,"y":157,"width":371,"height":11}},{"id":"23b99868-5d39-4728-9fde-d8b6cedf19e0","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":147,"box":{"x":167,"y":184,"width":361,"height":10}},{"id":"9a4eb13c-0111-4fd6-8c08-55b8f3ad0375","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":147,"box":{"x":535,"y":185,"width":288,"height":8}},{"id":"00e5fec4-e0ac-4751-9b67-258af0fb61fd","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":147,"box":{"x":167,"y":199,"width":361,"height":10}},{"id":"1aea2545-02a4-43c4-ac47-cbaa785e0f65","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.10%","page_number":147,"box":{"x":535,"y":200,"width":288,"height":9}},{"id":"cdbbcc5c-2091-429d-b0f2-6aeb6b7945ce","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":147,"box":{"x":167,"y":214,"width":345,"height":11}},{"id":"ed2be0f8-a3be-48ce-a316-4c872e280e73","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.05%","page_number":147,"box":{"x":518,"y":215,"width":305,"height":9}},{"id":"66f37402-21ad-4d0f-a767-2e28109364a2","block_type":"box","text":"With respect to Investor A Shares of BlackRock Low Duration Bond Por tfolio, BlackRock Floating Rate Income","page_number":147,"box":{"x":101,"y":239,"width":778,"height":11}},{"id":"fd134c95-de9c-4e0f-ab00-1832087fc373","block_type":"box","text":"Por tfolio, BlackRock Income Fund and BlackRock Strategic Income Oppor tunities Por tfolio of BlackRock Funds V, the","page_number":147,"box":{"x":69,"y":254,"width":830,"height":11}},{"id":"a893af4e-46ef-4e7a-b81b-bf2f38eb9430","block_type":"box","text":"placement fees may be up to the following amounts:","page_number":147,"box":{"x":70,"y":269,"width":371,"height":11}},{"id":"2556b2d8-77b4-4249-9162-221e8fdaaa00","block_type":"box","text":"$500,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":147,"box":{"x":167,"y":296,"width":410,"height":11}},{"id":"d8d9fa75-abcf-4e67-8f10-fe310c7e51d0","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 0.75%","page_number":147,"box":{"x":583,"y":297,"width":240,"height":9}},{"id":"4e7456cd-ee98-44e4-82d0-3e6070c98a62","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":147,"box":{"x":167,"y":311,"width":361,"height":11}},{"id":"3976cfc1-277d-4592-b228-aa5f500c0d3d","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":147,"box":{"x":535,"y":312,"width":288,"height":9}},{"id":"6c02c0e8-d5cb-4064-8f0f-f90044af6c53","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":147,"box":{"x":167,"y":326,"width":345,"height":11}},{"id":"1afc2aca-0837-44f1-bda2-740e05f47367","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":147,"box":{"x":518,"y":327,"width":305,"height":9}},{"id":"7d1498a0-b268-43f3-9c3d-e4e0b56dc955","block_type":"box","text":"With respect to Investor A Shares of BlackRock Shor t Duration Muni Fund of BlackRock Municipal Bond Fund,","page_number":147,"box":{"x":101,"y":351,"width":779,"height":11}},{"id":"d51ed7cf-4296-4835-8d7d-e4ab18ae8d72","block_type":"box","text":"Inc. (for shares purchased prior to March 18, 2019), the placement fees may be up to the following amounts:","page_number":147,"box":{"x":70,"y":366,"width":780,"height":11}},{"id":"6ba7b367-03d4-4afc-a8a1-a64d8d918671","block_type":"box","text":"$250,000 and above . . . .","page_number":147,"box":{"x":167,"y":393,"width":182,"height":11}},{"id":"2943dacb-2eaf-4f31-bf10-4099133c9b97","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":147,"box":{"x":355,"y":394,"width":468,"height":9}},{"id":"648ab1dc-f26e-4ada-b4e0-5578c3de99fa","block_type":"box","text":"With respect to Investor A Shares of BlackRock Shor t Duration Muni Fund of BlackRock Municipal Bond Fund,","page_number":147,"box":{"x":101,"y":418,"width":779,"height":11}},{"id":"25133386-2fad-4c0e-a466-37dd42d37efb","block_type":"box","text":"Inc. (for shares purchased on or after March 18, 2019 and prior to July 1, 2020), the placement fees may be up to","page_number":147,"box":{"x":70,"y":433,"width":819,"height":11}},{"id":"b30b4385-4334-4c6f-82a8-0f5e0f2cd6eb","block_type":"box","text":"the following amounts:","page_number":147,"box":{"x":68,"y":448,"width":161,"height":11}},{"id":"a44f4ff8-49bf-46ae-bb59-3fe3b14ce288","block_type":"box","text":"$100,000 and above . . . .","page_number":147,"box":{"x":167,"y":475,"width":182,"height":11}},{"id":"d34f42cf-2b81-4662-befd-fbaeb31887e1","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":147,"box":{"x":355,"y":476,"width":468,"height":8}},{"id":"82e691ab-a4e9-4ab5-9c7e-f289ddafb25a","block_type":"box","text":"With respect to Investor A Shares of BlackRock Shor t Duration Muni Fund of BlackRock Municipal Bond Fund,","page_number":147,"box":{"x":101,"y":499,"width":779,"height":11}},{"id":"44086790-bc07-4a93-bf1d-dce226f4c8e6","block_type":"box","text":"Inc. (for shares purchased on or after July 1, 2020), the placement fees may be up to the following amounts:","page_number":147,"box":{"x":70,"y":515,"width":775,"height":11}},{"id":"7c8c63bc-1d27-4e20-b012-0f3f60a6d3dd","block_type":"box","text":"$250,000 and above . . . .","page_number":147,"box":{"x":167,"y":542,"width":182,"height":11}},{"id":"db3012f1-8b6a-4ef6-a602-3ac77e45ffa9","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":147,"box":{"x":355,"y":542,"width":468,"height":9}},{"id":"c5709fab-3f34-4eec-aac8-f9801d8902e2","block_type":"box","text":"With respect to Investor A Shares of BlackRock Strategic Municipal Oppor tunities Fund of BlackRock Municipal","page_number":147,"box":{"x":101,"y":566,"width":788,"height":11}},{"id":"255eda2c-9f94-4dd6-b43a-cc061c9487b4","block_type":"box","text":"Series Trust, BlackRock California Municipal Oppor tunities Fund of BlackRock California Municipal Series Trust,","page_number":147,"box":{"x":69,"y":581,"width":792,"height":11}},{"id":"615ff28b-ba54-47d3-a68e-94c6c0c1417e","block_type":"box","text":"BlackRock New York Municipal Oppor tunities Fund, BlackRock New Jersey Municipal Bond Fund and BlackRock","page_number":147,"box":{"x":70,"y":597,"width":787,"height":11}},{"id":"e980db55-1e97-47e6-a595-3fc77fdb956e","block_type":"box","text":"Pennsylvania Municipal Bond Fund of BlackRock Multi-State Municipal Series Trust and BlackRock National Municipal","page_number":147,"box":{"x":69,"y":612,"width":834,"height":11}},{"id":"f1bee64f-62a5-4b69-84f3-c758e743b36f","block_type":"box","text":"Fund of BlackRock Municipal Bond Fund, Inc., the placement fees may be up to the following amounts:","page_number":147,"box":{"x":70,"y":627,"width":729,"height":11}},{"id":"ae7ca516-9a4a-422c-973f-fc3e11c1fb9c","block_type":"box","text":"$250,000 but less than $4 million . . . . . . . . . . . . . . . . . . . .","page_number":147,"box":{"x":167,"y":654,"width":410,"height":11}},{"id":"985c49f3-a64e-4919-9120-500de7758db1","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 1.00%","page_number":147,"box":{"x":583,"y":655,"width":240,"height":8}},{"id":"10de9ab5-481b-4d77-b51d-036d80f3f72b","block_type":"box","text":"$4 million but less than $10 million . . . . . . . . . . . . .","page_number":147,"box":{"x":167,"y":669,"width":361,"height":10}},{"id":"bdc11b47-1fe3-440c-a569-e27c9d314c59","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":147,"box":{"x":535,"y":670,"width":288,"height":9}},{"id":"e4c99171-c54a-4757-be80-8aafd8c20faa","block_type":"box","text":"$10 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":147,"box":{"x":167,"y":684,"width":345,"height":10}},{"id":"522862c3-f02f-4ee4-98d8-35a403400c2a","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":147,"box":{"x":518,"y":685,"width":305,"height":9}},{"id":"5f3fb8f4-b2e7-476c-b83b-45d7605a6126","block_type":"box","text":"With respect to Investor A Shares of BlackRock Dynamic High Income Por tfolio (for shares purchased on or after","page_number":147,"box":{"x":101,"y":709,"width":801,"height":11}},{"id":"8ebfaa86-2c1b-49fc-aabc-fceb727dce5e","block_type":"box","text":"July 1, 2020) and BlackRock Multi-Asset Income Por tfolio (for shares purchased on or after July 1, 2020) of","page_number":147,"box":{"x":69,"y":724,"width":769,"height":11}},{"id":"0e67e855-8960-4036-a08c-adca60ec9df2","block_type":"box","text":"BlackRock Funds II, BlackRock Total Return Fund of BlackRock Bond Fund, Inc. and BlackRock Balanced Fund, Inc.,","page_number":147,"box":{"x":70,"y":739,"width":818,"height":10}},{"id":"5a7352b4-34ec-412e-b2fd-ac8d69a0d39a","block_type":"box","text":"the placement fees may be up to the following amounts:","page_number":147,"box":{"x":68,"y":754,"width":401,"height":11}},{"id":"1185838a-2d21-4975-9e23-4ec02d5a0dd6","block_type":"box","text":"$250,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":147,"box":{"x":167,"y":781,"width":410,"height":11}},{"id":"47c86702-a699-4879-9f1b-62737a2b7442","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 0.75%","page_number":147,"box":{"x":583,"y":782,"width":240,"height":9}},{"id":"fb6872b3-f9b9-44b1-bdc3-dec204c1b365","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":147,"box":{"x":167,"y":796,"width":361,"height":11}},{"id":"e4150309-a40f-42dc-aeab-b47ea3b6cfcd","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":147,"box":{"x":535,"y":797,"width":288,"height":9}},{"id":"6a9585f1-f76a-4a48-b32d-383b28968cf4","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":147,"box":{"x":167,"y":811,"width":345,"height":11}},{"id":"c68f27da-b9bd-44f2-b1cc-f84c2b902a1f","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":147,"box":{"x":518,"y":812,"width":305,"height":9}},{"id":"d7ceb45a-7617-4512-9a01-39663618875f","block_type":"box","text":"With respect to Investor P Shares of BlackRock LifePath","page_number":147,"box":{"x":101,"y":836,"width":398,"height":11}},{"id":"08b65a21-499e-44c5-96ce-086df2aef823","block_type":"box","text":"®","page_number":147,"box":{"x":500,"y":836,"width":6,"height":5}},{"id":"8cfea606-5972-4394-94d1-c5da5cf61710","block_type":"box","text":"Index 2030 Fund, BlackRock LifePath","page_number":147,"box":{"x":513,"y":836,"width":264,"height":10}},{"id":"9ecb6a33-a9bd-44c7-9833-764ea54aaafe","block_type":"box","text":"®","page_number":147,"box":{"x":778,"y":836,"width":6,"height":5}},{"id":"89ebdd6c-dcb9-4ed1-8704-bf56a4c54321","block_type":"box","text":"Index 2035","page_number":147,"box":{"x":791,"y":836,"width":79,"height":9}},{"id":"f8a12654-0c82-44cf-9a3c-e6262cd476e1","block_type":"box","text":"Fund, BlackRock LifePath","page_number":147,"box":{"x":70,"y":851,"width":177,"height":10}},{"id":"680aa1da-dfbc-44bb-a081-288180307664","block_type":"box","text":"®","page_number":147,"box":{"x":249,"y":851,"width":6,"height":5}},{"id":"9173214f-08fd-4a27-8f6c-1ec9872a95cf","block_type":"box","text":"Index 2040 Fund, BlackRock LifePath","page_number":147,"box":{"x":261,"y":851,"width":265,"height":10}},{"id":"4ab3ea94-a38b-4be8-bdcd-98f0cfce8606","block_type":"box","text":"®","page_number":147,"box":{"x":527,"y":851,"width":6,"height":5}},{"id":"073656d4-0d53-4461-9060-6623c6ad6529","block_type":"box","text":"Index 2045 Fund, BlackRock LifePath","page_number":147,"box":{"x":539,"y":851,"width":265,"height":10}},{"id":"2a601e7c-f6b9-4ca5-9e9d-61d15487dcae","block_type":"box","text":"®","page_number":147,"box":{"x":805,"y":851,"width":6,"height":5}},{"id":"d3aee2c9-c92e-408f-b073-bb3ea9f74186","block_type":"box","text":"Index 2050","page_number":147,"box":{"x":817,"y":851,"width":80,"height":9}},{"id":"869243a9-3906-4815-81d5-07b83fa1033f","block_type":"box","text":"Fund, BlackRock LifePath","page_number":147,"box":{"x":70,"y":866,"width":177,"height":11}},{"id":"991b5619-22d3-444b-ac7c-9c3938d2cffb","block_type":"box","text":"®","page_number":147,"box":{"x":248,"y":866,"width":6,"height":5}},{"id":"ada729e0-d04c-4dde-8e8b-ed100a7b4004","block_type":"box","text":"Index 2055 Fund, BlackRock LifePath","page_number":147,"box":{"x":261,"y":866,"width":263,"height":11}},{"id":"fa9605c6-6de2-4bc2-8b3b-af42d684c809","block_type":"box","text":"®","page_number":147,"box":{"x":526,"y":866,"width":6,"height":5}},{"id":"5d50d261-8932-433f-8773-15979c38fc97","block_type":"box","text":"Index 2060 Fund, BlackRock LifePath","page_number":147,"box":{"x":538,"y":866,"width":264,"height":11}},{"id":"01bb7201-c9a5-450e-98ba-d4104e78a5ed","block_type":"box","text":"®","page_number":147,"box":{"x":803,"y":866,"width":6,"height":5}},{"id":"457915b2-14ba-4fef-8ff1-73f13ef8e5c1","block_type":"box","text":"Index 2065","page_number":147,"box":{"x":815,"y":866,"width":80,"height":9}},{"id":"4c4498f2-e8db-4804-b42a-94503e2add7f","block_type":"box","text":"II-103","page_number":147,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"6003542e-fdc6-4d3d-87b0-4cf0979049c7","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":147,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"9e8d19cf-2ab2-4b35-926d-b7bdcab906fb","block_type":"box","text":"Fund, BlackRock LifePath","page_number":148,"box":{"x":70,"y":45,"width":177,"height":10}},{"id":"b304f979-e5d9-4eaf-8e53-3ec87b55b4a8","block_type":"box","text":"®","page_number":148,"box":{"x":248,"y":45,"width":6,"height":4}},{"id":"ba1bc8f4-7f20-4982-87aa-11b951baeb66","block_type":"box","text":"Index 2070 Fund and BlackRock LifePath","page_number":148,"box":{"x":261,"y":45,"width":290,"height":9}},{"id":"e12036f4-ce01-4ba9-9500-aab73e397ad3","block_type":"box","text":"®","page_number":148,"box":{"x":552,"y":45,"width":6,"height":4}},{"id":"5cd73046-7ec6-4fd7-8b8f-938e49a31dea","block_type":"box","text":"Index Retirement Fund of BlackRock Funds III,","page_number":148,"box":{"x":564,"y":45,"width":324,"height":10}},{"id":"7ab956e0-4eb6-4cc1-8fd5-d7c12c5f8e8e","block_type":"box","text":"the placement fees may be up to the following amounts:","page_number":148,"box":{"x":68,"y":60,"width":401,"height":11}},{"id":"4aa72a48-9f08-446c-bd48-ce374e2f37ce","block_type":"box","text":"$1,000,000 and above . . . . .","page_number":148,"box":{"x":167,"y":87,"width":206,"height":11}},{"id":"98e8248c-e54d-40ad-a8ef-89f91440d545","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.10%","page_number":148,"box":{"x":380,"y":88,"width":443,"height":8}},{"id":"73523da5-213f-4ef5-add8-47e9d43427c3","block_type":"box","text":"With respect to Investor P Shares of iShares Municipal Bond Index Fund of BlackRock Funds","page_number":148,"box":{"x":101,"y":111,"width":657,"height":11}},{"id":"20bdc163-a2b5-463b-b29d-f478bb88d791","block_type":"box","text":"SM","page_number":148,"box":{"x":760,"y":112,"width":10,"height":4}},{"id":"4ab686f7-386f-490c-86f6-d643d6678ad6","block_type":"box","text":", the placement","page_number":148,"box":{"x":773,"y":112,"width":110,"height":10}},{"id":"f0c3f017-50f4-4808-a032-123c7f205c79","block_type":"box","text":"fees may be up to the following amounts:","page_number":148,"box":{"x":68,"y":126,"width":294,"height":12}},{"id":"be4958f0-9be8-44aa-8072-847fe3583945","block_type":"box","text":"$1,000,000 and above . . . . .","page_number":148,"box":{"x":167,"y":154,"width":206,"height":11}},{"id":"e8d9cc0d-4afd-4a09-9194-ff464e50adbc","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":148,"box":{"x":380,"y":154,"width":443,"height":9}},{"id":"b3504b70-447c-4e75-9d45-335b28b899d0","block_type":"box","text":"There are no placement fees for Investor P Shares of iShares MSCI EAFE International Index Fund and iShares","page_number":148,"box":{"x":101,"y":178,"width":787,"height":11}},{"id":"8f5cb4ac-9bdd-4ef7-845f-8884ae7dbcf8","block_type":"box","text":"Russell 2000 Small-Cap Index Fund of BlackRock Index Funds, Inc. and iShares S&P 500 Index Fund and iShares","page_number":148,"box":{"x":70,"y":193,"width":808,"height":11}},{"id":"84b5b60d-d4f1-48db-bfaa-6d8967597bf2","block_type":"box","text":"U.S. Aggregate Bond Index Fund of BlackRock Funds III.","page_number":148,"box":{"x":70,"y":208,"width":393,"height":12}},{"id":"be5ef0b5-cda7-4e0e-92ee-eff7737e14b3","block_type":"box","text":"For the tables above, the placement fees indicated will apply up to the indicated breakpoint (so that, for","page_number":148,"box":{"x":102,"y":231,"width":740,"height":11}},{"id":"de87993e-9c51-4b4e-a0eb-8a3a0f4e1eed","block_type":"box","text":"example, a sale of $4 million wor th of Investor A Shares of BlackRock Impact Mor tgage Fund of BlackRock Funds V","page_number":148,"box":{"x":69,"y":246,"width":823,"height":11}},{"id":"a9cd4d38-352c-4cf6-a1fe-cc77ded683df","block_type":"box","text":"will result in a placement fee of up to 0.50% on the first $3 million and a placement fee of 0.25% on the final","page_number":148,"box":{"x":68,"y":261,"width":780,"height":11}},{"id":"23eec5b0-75d8-4a08-a608-b936e4797c4f","block_type":"box","text":"$1 million).","page_number":148,"box":{"x":69,"y":276,"width":79,"height":11}},{"id":"aa0da25d-d17c-4d83-b82f-c555cbe3a3ed","block_type":"box","text":"Other.","page_number":148,"box":{"x":102,"y":299,"width":41,"height":9}},{"id":"ee51f66d-d185-4528-bfd1-3d29bb45ad08","block_type":"box","text":"The following persons may also buy Investor A or Investor P Shares without paying a sales charge:","page_number":148,"box":{"x":149,"y":299,"width":698,"height":11}},{"id":"1f495e35-754a-485a-b011-08eeaef92f35","block_type":"box","text":"(a) cer tain employer-sponsored retirement plans (for purposes of this waiver, employer-sponsored retirement plans do","page_number":148,"box":{"x":69,"y":314,"width":839,"height":11}},{"id":"0b55ba46-398a-47a1-aa13-e2e256f999cf","block_type":"box","text":"not include SEP IRAs, SIMPLE IRAs or SARSEPs); (b) rollovers of current investments through cer tain employer","page_number":148,"box":{"x":69,"y":329,"width":790,"height":12}},{"id":"18cc3927-bf20-4fc8-becf-d584c1c480f4","block_type":"box","text":"sponsored retirement plans provided the shares are transferred to Investor A or Investor P, as applicable, shares of","page_number":148,"box":{"x":69,"y":344,"width":825,"height":11}},{"id":"af2d62f5-faf0-4734-bd08-60da88a39469","block_type":"box","text":"the same or another BlackRock Fund as either a direct rollover, or subsequent to distribution, the rolled-over","page_number":148,"box":{"x":68,"y":360,"width":773,"height":11}},{"id":"ebe191a1-9c53-485f-9852-b57847b8d9d5","block_type":"box","text":"proceeds are contributed to a BlackRock IRA through an account directly with the Fund; or purchases by IRA programs","page_number":148,"box":{"x":70,"y":375,"width":838,"height":11}},{"id":"b053ecf1-ee45-43df-b905-e624bb30b86d","block_type":"box","text":"that are sponsored by financial intermediary firms provided the financial intermediary firm has entered into a Class A","page_number":148,"box":{"x":68,"y":390,"width":837,"height":11}},{"id":"6fc70f57-134a-4e79-b0c6-42ddd4f71459","block_type":"box","text":"or Investor P NAV agreement, as applicable, with respect to such program with the Distributor; (c) insurance company","page_number":148,"box":{"x":69,"y":405,"width":836,"height":11}},{"id":"c41ff546-9609-46b1-ad0c-34ec035ddb90","block_type":"box","text":"separate accounts; (d) registered investment advisers, trust companies and bank trust depar tments exercising","page_number":148,"box":{"x":69,"y":420,"width":793,"height":11}},{"id":"a5af3306-cb35-43f8-a173-19267ece1b1f","block_type":"box","text":"discretionary investment authority with respect to amounts to be invested in a Fund; (e) persons par ticipating in a","page_number":148,"box":{"x":69,"y":435,"width":811,"height":11}},{"id":"f0e4aaad-dfce-42c9-b6e5-df9f3f779b39","block_type":"box","text":"fee-based program (such as a wrap account) under which they pay advisory fees to a broker-dealer or other financial","page_number":148,"box":{"x":68,"y":450,"width":827,"height":12}},{"id":"c78f4778-2e48-47e0-9177-04be0447cd1a","block_type":"box","text":"institution; (f) financial intermediaries who have entered into an agreement with the Distributor and have been","page_number":148,"box":{"x":70,"y":465,"width":782,"height":12}},{"id":"8deb4102-4ef3-42ec-93e9-0ecea4b3b27f","block_type":"box","text":"approved by the Distributor to offer Fund shares to self-directed investment brokerage accounts that may or may not","page_number":148,"box":{"x":69,"y":481,"width":830,"height":11}},{"id":"47bf1745-95ba-4560-93a7-db069a0e8920","block_type":"box","text":"charge a transaction fee; (g) state sponsored 529 college savings plans and rollovers of such 529 plans into Roth","page_number":148,"box":{"x":69,"y":496,"width":815,"height":11}},{"id":"ece42d05-5274-4668-86a5-5343d691b3a1","block_type":"box","text":"IRAs as permitted under the Internal Revenue Code; (h) with respect to Investor A Shares only, accounts opened","page_number":148,"box":{"x":70,"y":511,"width":799,"height":11}},{"id":"b79bc7fa-235d-4fe1-a15e-07e68ce88a26","block_type":"box","text":"directly with a Fund that do not have a financial intermediary associated with the account; and (i) persons","page_number":148,"box":{"x":69,"y":526,"width":752,"height":11}},{"id":"2d65abc2-cfd4-4fc8-8601-8e275850d517","block_type":"box","text":"involuntarily liquidated from a Fund, who within 60 days of liquidation buy new shares of another BlackRock Fund (but","page_number":148,"box":{"x":70,"y":541,"width":836,"height":11}},{"id":"c33a3a8c-1405-4091-ae84-80657f30a1d0","block_type":"box","text":"only up to the amount that was liquidated). The following persons associated with the Funds, the Fund’s Manager,","page_number":148,"box":{"x":69,"y":556,"width":812,"height":11}},{"id":"dee80629-9d06-4d45-b7cb-4f83ac390831","block_type":"box","text":"Sub-Advisers, Transfer Agent, Distributor, fund accounting agents, Barclays PLC and their affiliates may buy Investor A","page_number":148,"box":{"x":69,"y":571,"width":839,"height":12}},{"id":"6779fd63-8a10-4e59-b90e-c16e6675d35a","block_type":"box","text":"or Investor P Shares of each of the Funds without paying a sales charge to the extent permitted by these firms","page_number":148,"box":{"x":69,"y":586,"width":788,"height":12}},{"id":"215f5658-38b1-497d-a549-d91b4b059da6","block_type":"box","text":"including: (a) officers, directors and par tners; (b) employees and retirees; (c) employees or registered representatives","page_number":148,"box":{"x":70,"y":601,"width":838,"height":12}},{"id":"b13d911e-845c-4fd5-8120-383586e0fbb6","block_type":"box","text":"of firms who have entered into selling agreements to distribute shares of BlackRock-advised funds; (d) immediate","page_number":148,"box":{"x":69,"y":617,"width":810,"height":11}},{"id":"bfbfc098-6be0-4910-91a3-e363dd2a4ea5","block_type":"box","text":"family members of such persons (“immediate family members” shall be defined as the investor, the investor’s","page_number":148,"box":{"x":68,"y":632,"width":787,"height":11}},{"id":"037d54ea-0bea-4b15-8f88-fc012b9bff20","block_type":"box","text":"spouse or domestic par tner, children, parents and siblings); and (e) any trust, pension, profit-sharing or other benefit","page_number":148,"box":{"x":69,"y":647,"width":834,"height":11}},{"id":"f9cd9209-fdf4-4b4f-935a-47c8966eb579","block_type":"box","text":"plan for any of the persons set for th in (a) through (d). Investors who qualify for any of these exemptions from the","page_number":148,"box":{"x":70,"y":662,"width":808,"height":11}},{"id":"ace32ff1-632c-447f-892d-798f2fa43149","block_type":"box","text":"sales charge should purchase Investor A or Investor P Shares. In addition, a sales charge waiver may be available for","page_number":148,"box":{"x":69,"y":677,"width":837,"height":11}},{"id":"0e6e20e2-0b84-4830-9275-67938694e1d5","block_type":"box","text":"investors exchanging Investor A Shares of one BlackRock Fund for Investor P Shares of another BlackRock Fund, or","page_number":148,"box":{"x":70,"y":692,"width":820,"height":11}},{"id":"8dc24358-2d0b-4d4b-b212-a268061523e2","block_type":"box","text":"exchanging Investor P Shares of one BlackRock Fund for Investor A Shares of another BlackRock Fund, through an","page_number":148,"box":{"x":69,"y":707,"width":813,"height":12}},{"id":"26ea2959-af0e-4f8f-ae8f-216d20fde519","block_type":"box","text":"intermediary-processed exchange, provided that the investor had previously paid a sales charge with respect to such","page_number":148,"box":{"x":70,"y":723,"width":831,"height":11}},{"id":"0f0c727a-24be-4be9-95d0-18b1ae8114ef","block_type":"box","text":"shares. The availability of Investor A or Investor P Shares sales charge waivers may depend upon the policies,","page_number":148,"box":{"x":69,"y":738,"width":783,"height":11}},{"id":"0dc15634-65e9-47e0-9a6a-95df709b470c","block_type":"box","text":"procedures and trading platforms of your financial intermediary; consult your financial adviser.","page_number":148,"box":{"x":70,"y":753,"width":668,"height":11}},{"id":"3a062866-94f0-418d-89eb-59857fbe5dc9","block_type":"box","text":"If you invest $1,000,000 ($250,000 for BlackRock Dynamic High Income Por tfolio, BlackRock Multi-Asset","page_number":148,"box":{"x":102,"y":775,"width":754,"height":12}},{"id":"d1077d9b-67e6-4d35-9d20-d6d7ee342fc9","block_type":"box","text":"Income Por tfolio and BlackRock Managed Income Fund of BlackRock Funds II, BlackRock Credit Relative Value Fund","page_number":148,"box":{"x":70,"y":790,"width":823,"height":12}},{"id":"0949b2b5-1a57-4f3f-a78f-901213e9a5bd","block_type":"box","text":"of BlackRock Funds IV, BlackRock Total Return Fund of BlackRock Bond Fund, Inc., BlackRock Global Allocation Fund,","page_number":148,"box":{"x":69,"y":806,"width":833,"height":10}},{"id":"420b93c6-bbd4-4934-930a-a319c250c09a","block_type":"box","text":"Inc., BlackRock National Municipal Fund of BlackRock Municipal Bond Fund, Inc., BlackRock Shor t Duration Muni","page_number":148,"box":{"x":70,"y":821,"width":802,"height":11}},{"id":"4b521626-f6f1-44fe-9d70-809a3b15e341","block_type":"box","text":"Fund of BlackRock Municipal Bond Fund, Inc., BlackRock Strategic Municipal Oppor tunities Fund of BlackRock","page_number":148,"box":{"x":70,"y":836,"width":781,"height":11}},{"id":"59433dd0-b963-4000-aec6-8f9c65b17c44","block_type":"box","text":"Municipal Series Trust, BlackRock California Municipal Oppor tunities Fund of BlackRock California Municipal Series","page_number":148,"box":{"x":70,"y":851,"width":819,"height":11}},{"id":"16868756-6b59-45cd-9379-9601264fda43","block_type":"box","text":"Trust, BlackRock New York Municipal Oppor tunities Fund, BlackRock New Jersey Municipal Bond Fund and BlackRock","page_number":148,"box":{"x":68,"y":866,"width":835,"height":11}},{"id":"9b2a7112-2080-438d-b2c1-971f92d99495","block_type":"box","text":"Pennsylvania Municipal Bond Fund of BlackRock Multi-State Municipal Series Trust, BlackRock Event Driven Equity","page_number":148,"box":{"x":69,"y":881,"width":813,"height":11}},{"id":"0821896f-2cf6-4621-858f-aa46e787592e","block_type":"box","text":"Fund and BlackRock Balanced Fund, Inc., and $500,000 for BlackRock Low Duration Bond Por tfolio, BlackRock","page_number":148,"box":{"x":70,"y":896,"width":792,"height":11}},{"id":"7ac481ea-1892-400b-9d2c-65720fd8b29b","block_type":"box","text":"Floating Rate Income Por tfolio, BlackRock Income Fund and BlackRock Strategic Income Oppor tunities Por tfolio of","page_number":148,"box":{"x":70,"y":911,"width":813,"height":12}},{"id":"b85946a1-aa32-4606-894e-0d420519d765","block_type":"box","text":"II-104","page_number":148,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"2eb550e9-b2e3-442c-88de-5bee385f2dec","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":148,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"748aa5c8-60ef-4afd-9ce7-d159d87c18e3","block_type":"box","text":"BlackRock Funds V) or more in Investor A or Investor P Shares, as applicable, you may not pay an initial sales charge.","page_number":149,"box":{"x":70,"y":45,"width":837,"height":11}},{"id":"c1e3b2d7-224d-483d-a70a-29321751d5d6","block_type":"box","text":"However, if you redeem your Investor A or Investor P Shares, as applicable, within 18 months after purchase (a","page_number":149,"box":{"x":70,"y":60,"width":790,"height":11}},{"id":"518164bf-e799-471f-a5d5-e0231f283b20","block_type":"box","text":"shor ter holding period may apply depending on the Fund), you may be charged a deferred sales charge.","page_number":149,"box":{"x":69,"y":75,"width":736,"height":11}},{"id":"8db11358-f84f-4251-ba35-457aed0f7a2d","block_type":"box","text":"A deferred sales charge of up to 1.00% may apply to cer tain redemptions of Investor A Shares of the Index","page_number":149,"box":{"x":101,"y":98,"width":763,"height":11}},{"id":"f0283fb9-5afb-4eb4-b59b-d4f65a77b9e5","block_type":"box","text":"Funds and BlackRock Shor t Obligations Fund purchased in an exchange transaction for Investor A Shares of a","page_number":149,"box":{"x":70,"y":113,"width":782,"height":11}},{"id":"3bc309bb-2527-478e-a5d5-963e3d38c91e","block_type":"box","text":"por tfolio advised by BlackRock or its affiliates where no initial sales charge was paid at the time of purchase of such","page_number":149,"box":{"x":70,"y":128,"width":832,"height":11}},{"id":"7c835f4d-7bc7-4aa2-8f18-582c27b3843f","block_type":"box","text":"fund (an “Investor A Load-Waived BlackRock Por tfolio”) as par t of an investment of $1,000,000 (lesser amounts may","page_number":149,"box":{"x":68,"y":142,"width":839,"height":12}},{"id":"ba297fd7-1330-4dd1-a41d-e529c9cf9d97","block_type":"box","text":"apply depending on the Investor A Load-Waived BlackRock Por tfolio) or more. The Investor A Shares deferred sales","page_number":149,"box":{"x":69,"y":158,"width":817,"height":11}},{"id":"57a6dc0d-f2ed-4971-8ba6-cced14956220","block_type":"box","text":"charge is only charged upon redemptions of Investor A Shares within 18 months after you originally acquired such","page_number":149,"box":{"x":69,"y":173,"width":811,"height":11}},{"id":"3ed29916-15ca-43f9-958b-96f24e8b4db5","block_type":"box","text":"Investor A Shares of the Investor A Load-Waived BlackRock Por tfolio (a shor ter holding period may apply depending","page_number":149,"box":{"x":70,"y":188,"width":818,"height":12}},{"id":"e88807bc-67ae-4f79-9d8a-11070ea9373d","block_type":"box","text":"on the Investor A Load-Waived BlackRock Por tfolio), unless you qualify for a waiver. There is no deferred sales charge","page_number":149,"box":{"x":69,"y":203,"width":836,"height":12}},{"id":"b965cee0-7cc6-4b19-a30e-b418fafbb9a5","block_type":"box","text":"charged on redemptions if you have owned your Investor A Shares for more than 18 months (or for a shor ter holding","page_number":149,"box":{"x":69,"y":218,"width":830,"height":12}},{"id":"8483a2f6-2539-4ecf-a261-4cbfdae12bd5","block_type":"box","text":"period, as applicable) (as measured from your original purchase of Investor A Shares that you exchanged into","page_number":149,"box":{"x":70,"y":234,"width":778,"height":11}},{"id":"a68c18c3-5f20-40e7-9cf9-38214f3a1357","block_type":"box","text":"Investor A Shares of the Index Fund or BlackRock Shor t Obligations Fund).","page_number":149,"box":{"x":70,"y":249,"width":526,"height":11}},{"id":"0fa7dffd-9849-4f4a-bfa6-7bc66792c1f1","block_type":"box","text":"The deferred sales charge on Investor A or Investor P Shares, as applicable, is not charged in connection with:","page_number":149,"box":{"x":101,"y":271,"width":788,"height":12}},{"id":"a150b891-377a-4fb0-9e82-a9d3416b8b0a","block_type":"box","text":"(a) redemptions of Investor A or Investor P Shares purchased through cer tain employer-sponsored retirement plans","page_number":149,"box":{"x":69,"y":286,"width":819,"height":12}},{"id":"6f908d2b-8407-4787-9888-3b0350314905","block_type":"box","text":"and rollovers of current investments in a Fund through such plans; (b) exchanges described in “Exchange Privilege”","page_number":149,"box":{"x":69,"y":302,"width":820,"height":11}},{"id":"836cdca9-7f16-43ec-8257-f40374c53acb","block_type":"box","text":"below; (c) redemptions made in connection with minimum required distributions from IRA and 403(b)(7) accounts due","page_number":149,"box":{"x":69,"y":317,"width":837,"height":11}},{"id":"fd6b2006-ff47-416a-a472-27a8e6e5e3c9","block_type":"box","text":"to the shareholder reaching the applicable age triggering such distributions; (d) redemptions made with respect to","page_number":149,"box":{"x":68,"y":332,"width":812,"height":11}},{"id":"add5f283-5aa4-401a-abfb-73d6fce44de8","block_type":"box","text":"cer tain retirement plans sponsored by a Fund, BlackRock or its affiliates; (e) redemptions (i) within one year of a","page_number":149,"box":{"x":69,"y":347,"width":803,"height":11}},{"id":"2d002d2c-993d-4cca-b6b5-57ec72f88d78","block_type":"box","text":"shareholder’s death or, if later, the receipt of a cer tified probate settlement (including in connection with the","page_number":149,"box":{"x":69,"y":362,"width":772,"height":11}},{"id":"0317c7f9-1ee4-4ef5-a64c-e4b4dea8f24f","block_type":"box","text":"distribution of account assets to a beneficiary of the decedent) or (ii) in connection with a shareholder’s disability (as","page_number":149,"box":{"x":69,"y":377,"width":835,"height":11}},{"id":"90820928-35f7-472c-9bb6-5dd1784da6b5","block_type":"box","text":"defined in the Code) subsequent to the purchase of Investor A or Investor P Shares; (f) involuntary redemptions of","page_number":149,"box":{"x":69,"y":392,"width":814,"height":12}},{"id":"d5d71419-4834-405d-b1f3-727cff225fda","block_type":"box","text":"Investor A or Investor P Shares in accounts with low balances; (g) cer tain redemptions made pursuant to the","page_number":149,"box":{"x":70,"y":408,"width":772,"height":11}},{"id":"1e441581-0e79-4945-a014-542fd1dd4eed","block_type":"box","text":"Systematic Withdrawal Plan (described below); (h) redemptions related to the payment of BNY Mellon Investment","page_number":149,"box":{"x":69,"y":423,"width":805,"height":11}},{"id":"35bfab50-858b-4ca5-ad38-269d9a23d65a","block_type":"box","text":"Servicing Trust Company custodial IRA fees; and (i) redemptions when a shareholder can demonstrate hardship, in","page_number":149,"box":{"x":69,"y":438,"width":817,"height":11}},{"id":"f49b09bb-232f-46f7-aa5c-f136ee5b3fb3","block_type":"box","text":"the absolute discretion of a Fund.","page_number":149,"box":{"x":68,"y":453,"width":239,"height":9}},{"id":"efed6f95-1fb9-4260-8a7a-b0a889b1c727","block_type":"box","text":"With respect to cer tain employer-sponsored retirement plans, if a dealer waives its right to receive a placement","page_number":149,"box":{"x":101,"y":475,"width":794,"height":12}},{"id":"0a88167a-1faa-43a7-9a6c-8a204aeec20f","block_type":"box","text":"fee, the Fund may, at its own discretion, waive the CDSC related to purchases of $1,000,000 ($250,000 for","page_number":149,"box":{"x":68,"y":490,"width":776,"height":12}},{"id":"23e809fe-1527-42a4-a774-8073ec936f0b","block_type":"box","text":"BlackRock Dynamic High Income Por tfolio, BlackRock Multi-Asset Income Por tfolio and BlackRock Managed Income","page_number":149,"box":{"x":70,"y":506,"width":821,"height":11}},{"id":"3b7aec85-ac44-4328-b1ea-3b7f8cac3726","block_type":"box","text":"Fund of BlackRock Funds II, BlackRock Credit Relative Value Fund of BlackRock Funds IV, BlackRock Total Return","page_number":149,"box":{"x":70,"y":521,"width":800,"height":10}},{"id":"a3466512-4634-446c-ba10-3ca2e74236ef","block_type":"box","text":"Fund of BlackRock Bond Fund, Inc., BlackRock Global Allocation Fund, Inc., BlackRock National Municipal Fund of","page_number":149,"box":{"x":70,"y":536,"width":806,"height":11}},{"id":"84e35732-5b6c-45dc-b5ed-51b26f2ddbef","block_type":"box","text":"BlackRock Municipal Bond Fund, Inc., BlackRock Shor t Duration Muni Fund of BlackRock Municipal Bond Fund, Inc.,","page_number":149,"box":{"x":70,"y":551,"width":823,"height":11}},{"id":"908f8570-6de1-41f8-ab8b-8b49fca0307e","block_type":"box","text":"BlackRock Strategic Municipal Oppor tunities Fund of BlackRock Municipal Series Trust, BlackRock California","page_number":149,"box":{"x":70,"y":566,"width":770,"height":11}},{"id":"e2be3dc1-bf0b-4ec4-bdd0-422fa1578ec1","block_type":"box","text":"Municipal Oppor tunities Fund of BlackRock California Municipal Series Trust, BlackRock New York Municipal","page_number":149,"box":{"x":70,"y":581,"width":766,"height":11}},{"id":"b52d601c-5813-4fcc-a9e9-675571e1ca7e","block_type":"box","text":"Oppor tunities Fund, BlackRock New Jersey Municipal Bond Fund and BlackRock Pennsylvania Municipal Bond Fund of","page_number":149,"box":{"x":69,"y":596,"width":837,"height":12}},{"id":"92007732-e0c4-465b-a8a1-9b9fb2ea13c3","block_type":"box","text":"BlackRock Multi-State Municipal Series Trust, BlackRock Event Driven Equity Fund and BlackRock Balanced Fund,","page_number":149,"box":{"x":70,"y":612,"width":805,"height":11}},{"id":"42c1c30b-3d97-4eda-ab53-42b47389f5e9","block_type":"box","text":"Inc., and $500,000 for BlackRock Low Duration Bond Por tfolio, BlackRock Floating Rate Income Por tfolio, BlackRock","page_number":149,"box":{"x":70,"y":626,"width":832,"height":12}},{"id":"0e6f7a17-e411-41b7-b739-2bde10a57b92","block_type":"box","text":"Income Fund and BlackRock Strategic Income Oppor tunities Por tfolio of BlackRock Funds V) or more of Investor A or","page_number":149,"box":{"x":70,"y":642,"width":828,"height":11}},{"id":"e00fae87-d1e6-4feb-9428-47f0d82f24ab","block_type":"box","text":"Investor P Shares. This may depend upon the policies, procedures and trading platforms of your financial","page_number":149,"box":{"x":70,"y":657,"width":746,"height":11}},{"id":"e8c6084f-2f9f-422f-8646-7397d3f25ba4","block_type":"box","text":"intermediary; consult your financial adviser.","page_number":149,"box":{"x":70,"y":672,"width":307,"height":11}},{"id":"f9bde6ff-ddf1-4bda-8467-65f078c734d4","block_type":"box","text":"Investor A and Investor P Shares are also available at NAV to investors that, for regulatory reasons, are required","page_number":149,"box":{"x":102,"y":695,"width":799,"height":11}},{"id":"1633b521-2e96-4bde-8f5a-68ebd559c757","block_type":"box","text":"to transfer investment positions from a foreign registered investment company advised by BlackRock or its affiliates","page_number":149,"box":{"x":68,"y":710,"width":829,"height":11}},{"id":"f725de7b-a99b-4be8-ac11-a6d6d127fc4a","block_type":"box","text":"to a U.S. registered BlackRock-advised fund.","page_number":149,"box":{"x":68,"y":725,"width":317,"height":11}},{"id":"83057090-00e3-4be1-9d7c-15bef52bbde2","block_type":"box","text":"Acquisition of Cer tain Investment Companies.","page_number":149,"box":{"x":101,"y":748,"width":326,"height":11}},{"id":"0522f085-e974-4b7a-8fb7-23c8bf53515e","block_type":"box","text":"Investor A and Investor P Shares may be offered at NAV in","page_number":149,"box":{"x":434,"y":748,"width":413,"height":11}},{"id":"2f706eb2-bb2f-4305-b124-ed772d8872cc","block_type":"box","text":"connection with the acquisition of the assets of, or merger or consolidation with, a personal holding company or a","page_number":149,"box":{"x":69,"y":763,"width":811,"height":11}},{"id":"3487a1d0-264b-4868-9142-b834d6ab4443","block_type":"box","text":"public or private investment company.","page_number":149,"box":{"x":70,"y":778,"width":266,"height":11}},{"id":"251949a5-6136-42b4-b609-1c9ee5834206","block_type":"box","text":"Purchases Through Cer tain Financial Intermediaries.","page_number":149,"box":{"x":102,"y":801,"width":372,"height":11}},{"id":"8616758b-7f87-409e-9f1f-b1cb8e122e91","block_type":"box","text":"Reduced sales charges may be applicable for purchases of","page_number":149,"box":{"x":481,"y":801,"width":421,"height":11}},{"id":"5cecbaa2-0cc6-470f-8ea9-bee3ccd4c1c1","block_type":"box","text":"Investor A, Investor A1 or Investor P Shares of a Fund through cer tain financial advisers, selected securities dealers","page_number":149,"box":{"x":70,"y":816,"width":825,"height":11}},{"id":"caec81ea-bcc4-4ff9-88a5-0e4e75dcbb79","block_type":"box","text":"and other financial intermediaries that meet and adhere to standards established by the Manager from time to time.","page_number":149,"box":{"x":69,"y":831,"width":830,"height":11}},{"id":"702fb3c4-e8a5-4fea-9977-f26c9cecac08","block_type":"box","text":"II-105","page_number":149,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"903d5bf9-0fc1-46bf-83f6-55367947e780","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":149,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"cd8144c3-65ab-42d3-88ad-d1d4613bbd4f","block_type":"box","text":"Deferred Sales Charge Alternative — Investor C Shares","page_number":150,"box":{"x":69,"y":45,"width":405,"height":11}},{"id":"46120dd9-93a1-445e-aedc-78f552d4915d","block_type":"box","text":"Investors choosing the deferred sales charge alternative should consider Investor C Shares if they are uncer tain","page_number":150,"box":{"x":102,"y":67,"width":799,"height":12}},{"id":"6e667033-93bd-44b2-9dd1-88b5c2c8a481","block_type":"box","text":"as to the length of time they intend to hold their assets in a Fund. If you select Investor C Shares, you do not pay an","page_number":150,"box":{"x":69,"y":82,"width":828,"height":12}},{"id":"f4cd1c73-505c-41dd-b66d-68ae47757f53","block_type":"box","text":"initial sales charge at the time of purchase. A Fund will not accept a purchase order of $500,000 or more for","page_number":150,"box":{"x":70,"y":97,"width":778,"height":12}},{"id":"f9d260b6-99c6-410a-ab33-6ce6b21efce3","block_type":"box","text":"Investor C Shares (may be lower on funds that have set a lower breakpoint for NAV). Your financial intermediary may","page_number":150,"box":{"x":70,"y":113,"width":826,"height":11}},{"id":"8c0623a3-fed3-496a-938e-5beec8c99b15","block_type":"box","text":"set a lower maximum for Investor C Shares.","page_number":150,"box":{"x":69,"y":128,"width":311,"height":9}},{"id":"39c441c9-58b4-4814-8b33-8a8301986f77","block_type":"box","text":"Investor C Shares are not available in accounts opened or held directly with a Fund that do not have a financial","page_number":150,"box":{"x":102,"y":150,"width":789,"height":12}},{"id":"a90c8be7-424a-4834-9d01-27bb5888a3a5","block_type":"box","text":"intermediary associated with the account.","page_number":150,"box":{"x":70,"y":166,"width":297,"height":11}},{"id":"5a5d462b-0c88-4c27-8507-acf65c9c61a7","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":150,"box":{"x":102,"y":188,"width":669,"height":12}},{"id":"ce3479dc-2ca7-471f-aeb4-fc688dec1031","block_type":"box","text":"The deferred sales charge alternatives may be par ticularly appealing to investors who do not qualify for the","page_number":150,"box":{"x":101,"y":211,"width":763,"height":11}},{"id":"56082f0e-da98-4f76-8fda-0e7217a966b0","block_type":"box","text":"reduction in initial sales charges. CDSC shares are subject to ongoing service fees and distribution fees; however,","page_number":150,"box":{"x":69,"y":226,"width":815,"height":11}},{"id":"2b881918-83df-416a-8850-18d1c3d46e48","block_type":"box","text":"these fees potentially may be offset to the extent any return is realized on the additional funds initially invested in","page_number":150,"box":{"x":68,"y":241,"width":813,"height":11}},{"id":"907a7892-14fd-489e-aa14-23d9f6d3bd91","block_type":"box","text":"CDSC shares.","page_number":150,"box":{"x":69,"y":256,"width":97,"height":9}},{"id":"3e382387-dfa4-4e85-8214-200406c470fc","block_type":"box","text":"BlackRock compensates financial advisers and other financial intermediaries for selling CDSC shares at the time","page_number":150,"box":{"x":102,"y":279,"width":804,"height":11}},{"id":"c22ea40b-a1f5-4275-93b9-68220acaf507","block_type":"box","text":"of purchase from its own funds. Proceeds from the CDSC and the distribution fee are paid to the Distributor and are","page_number":150,"box":{"x":69,"y":294,"width":827,"height":11}},{"id":"6952dda2-697d-4a35-9588-1c22b0ac967e","block_type":"box","text":"used by the Distributor to defray the expenses of securities dealers or other financial intermediaries related to","page_number":150,"box":{"x":69,"y":309,"width":786,"height":11}},{"id":"46ec68c6-7a99-42c1-8716-dd4ef135fb95","block_type":"box","text":"providing distribution-related services to each Fund in connection with the sale of the CDSC shares. The combination","page_number":150,"box":{"x":70,"y":324,"width":831,"height":12}},{"id":"16676dcc-c7d1-4aa1-a317-600dbc0a37e0","block_type":"box","text":"of the CDSC and the ongoing distribution fee facilitates the ability of each Fund to sell the CDSC shares without a","page_number":150,"box":{"x":69,"y":339,"width":809,"height":12}},{"id":"17b3ceb7-b2b5-462d-a00b-843fe5e61e7a","block_type":"box","text":"sales charge being deducted at the time of purchase. See “Distribution and/or Shareholder Servicing Plans” below.","page_number":150,"box":{"x":69,"y":355,"width":824,"height":11}},{"id":"5acecf53-1b09-48bf-a6fd-0333804d134f","block_type":"box","text":"Imposition of the CDSC and the distribution fee on CDSC shares is limited by FINRA (as defined below) asset-based","page_number":150,"box":{"x":70,"y":370,"width":822,"height":11}},{"id":"ed415b38-eaf8-42e7-bb3c-f838ea16bc7f","block_type":"box","text":"sales charge rule. See “Limitations on the Payment of Deferred Sales Charges” below.","page_number":150,"box":{"x":69,"y":385,"width":618,"height":11}},{"id":"12f33fbb-4b9e-4844-aa64-56deedd76aef","block_type":"box","text":"Dealers will generally immediately receive commissions equal to 1.00% of the Investor C Shares sold by them","page_number":150,"box":{"x":102,"y":407,"width":782,"height":12}},{"id":"787af771-a003-4d22-967d-b228eee700b5","block_type":"box","text":"plus ongoing fees under the Fund’s Distribution and Service Plan. Dealers may not receive a commission in","page_number":150,"box":{"x":70,"y":423,"width":764,"height":11}},{"id":"716eab23-0363-4fcf-8819-94541ffd7109","block_type":"box","text":"connection with sales of Investor C Shares to cer tain employer-sponsored retirement plans sponsored by the Fund,","page_number":150,"box":{"x":69,"y":438,"width":820,"height":11}},{"id":"c72872e1-8c05-4742-9d50-47c0d5aebb32","block_type":"box","text":"BlackRock or its affiliates, but may receive fees under the Distribution and Service Plan. These commissions and","page_number":150,"box":{"x":70,"y":453,"width":806,"height":11}},{"id":"7af6d232-fa87-48c1-a53a-366b85ce265c","block_type":"box","text":"payments may be different than the reallowances, placement fees and commissions paid to dealers in connection","page_number":150,"box":{"x":70,"y":468,"width":813,"height":11}},{"id":"79601307-ac96-439a-a32c-fc0c83047a3b","block_type":"box","text":"with sales of Investor A, Investor A1 and Investor P Shares. These may depend upon the policies, procedures and","page_number":150,"box":{"x":68,"y":483,"width":811,"height":11}},{"id":"ed70a6b1-edb3-4820-a30a-85f8640e8b06","block_type":"box","text":"trading platforms of your financial intermediary; consult your financial adviser.","page_number":150,"box":{"x":68,"y":498,"width":554,"height":11}},{"id":"9f2f2684-94fa-42b9-9856-26a09881d1c8","block_type":"box","text":"Each Fund has adopted an automatic conversion feature for Investor C Shares. Effective November 23, 2020,","page_number":150,"box":{"x":102,"y":521,"width":783,"height":11}},{"id":"86f503ef-a732-4d5e-8c57-ca853adb12db","block_type":"box","text":"Investor C Shares held for approximately eight years will be conver ted into Investor A Shares, as set for th in each","page_number":150,"box":{"x":70,"y":536,"width":808,"height":11}},{"id":"ef933152-295e-4ac4-9c88-dfd93f606313","block_type":"box","text":"Fund’s Prospectus. In addition, accounts that do not have a financial intermediary associated with them are not","page_number":150,"box":{"x":70,"y":551,"width":797,"height":11}},{"id":"ef60fa73-f93b-4d35-856a-b429dfcbd96f","block_type":"box","text":"eligible to hold Investor C Shares, and any Investor C Shares held in such accounts will be automatically conver ted to","page_number":150,"box":{"x":69,"y":566,"width":837,"height":11}},{"id":"b99256ee-1eac-4f6b-9d74-62916d4a473b","block_type":"box","text":"Investor A Shares.","page_number":150,"box":{"x":70,"y":581,"width":128,"height":9}},{"id":"63e6cab1-4454-4e26-94f5-ab4a0d966209","block_type":"box","text":"Conversion of Investor C Shares to Investor A Shares","page_number":150,"box":{"x":102,"y":604,"width":378,"height":9}},{"id":"44a0736a-c57c-4e41-9a44-3a371d0cded3","block_type":"box","text":"Effective November 23, 2020 (the “Effective Date”), approximately eight years after purchase, Investor C Shares","page_number":150,"box":{"x":102,"y":627,"width":804,"height":11}},{"id":"b5dc8ed4-ae52-4aff-b75a-ee42f9b7077f","block_type":"box","text":"of each Fund will conver t automatically into Investor A Shares of that Fund (the “Investor C 8-Year Conversion”).","page_number":150,"box":{"x":69,"y":642,"width":794,"height":11}},{"id":"af2d5d96-1486-4db9-a55f-361bb6bc8b2a","block_type":"box","text":"Cer tain funds (the “Predecessor Funds”) were reorganized into new Funds (the “Successor Funds”) pursuant to","page_number":150,"box":{"x":69,"y":657,"width":794,"height":11}},{"id":"0c2255b4-a545-48cd-bbc6-b7ccc3de8776","block_type":"box","text":"reorganizations which occurred in September 2018. The holding period for Investor C Shares of Successor Funds","page_number":150,"box":{"x":69,"y":672,"width":806,"height":11}},{"id":"d8e17fe4-7cac-48fa-b56d-dbfbf852474e","block_type":"box","text":"includes the period such shares were held in the respective Predecessor Fund. It is the financial intermediary’s","page_number":150,"box":{"x":70,"y":687,"width":793,"height":11}},{"id":"5a34ea4d-8049-41ba-9737-1d39632e9d83","block_type":"box","text":"responsibility to ensure that the shareholder is credited with the proper holding period. As of the Effective Date,","page_number":150,"box":{"x":69,"y":702,"width":796,"height":12}},{"id":"a02668e1-0af1-417c-80f4-e6fde06d9500","block_type":"box","text":"cer tain financial intermediaries, including group retirement recordkeeping platforms, may not have been tracking","page_number":150,"box":{"x":69,"y":717,"width":802,"height":12}},{"id":"787105ee-c0aa-43d4-a4fa-ab3dd528c9af","block_type":"box","text":"such holding periods and therefore may not be able to process such conversions. In such instances, Investor C","page_number":150,"box":{"x":69,"y":732,"width":793,"height":12}},{"id":"7c1bacc1-c48f-4f33-ab83-e53596ea23c5","block_type":"box","text":"Shares held as of the Effective Date will automatically conver t to Investor A Shares approximately eight years after","page_number":150,"box":{"x":69,"y":748,"width":817,"height":11}},{"id":"f949e823-cd3c-49e1-99ed-fb8ee834a434","block_type":"box","text":"the Effective Date. If, as of November 23, 2028 (eight years after the Effective Date), a financial intermediary has","page_number":150,"box":{"x":68,"y":763,"width":814,"height":11}},{"id":"20fdbd5e-3fd1-4001-b2d9-5e5623efa11a","block_type":"box","text":"not implemented systems or procedures to track holding periods commencing from the Effective Date, shareholders","page_number":150,"box":{"x":69,"y":778,"width":828,"height":11}},{"id":"18ec9215-49db-4251-822e-9b78bd81ff8e","block_type":"box","text":"holding Investor C Shares through such financial intermediary will no longer be eligible to hold Investor C Shares and","page_number":150,"box":{"x":69,"y":793,"width":832,"height":11}},{"id":"266aa10e-fd8a-4109-8c73-1e777e234f4e","block_type":"box","text":"any such shares will conver t to Investor A Shares as soon as reasonably practicable after such date.","page_number":150,"box":{"x":69,"y":808,"width":718,"height":11}},{"id":"974a7445-86e5-4045-927e-5e1062c08c8f","block_type":"box","text":"In addition, accounts that do not have a financial intermediary associated with them are not eligible to hold","page_number":150,"box":{"x":102,"y":831,"width":764,"height":11}},{"id":"020c9755-fd65-4d88-b4a9-fb75124f2d01","block_type":"box","text":"Investor C Shares, and any Investor C Shares held in such accounts will be automatically conver ted into Investor A","page_number":150,"box":{"x":70,"y":846,"width":816,"height":11}},{"id":"15bfbddb-fd76-4699-9662-63ccc9f62a2c","block_type":"box","text":"Shares (the “Investor C Direct Accounts Conversion” and together with the Investor C 8-Year Conversion, the","page_number":150,"box":{"x":69,"y":861,"width":772,"height":11}},{"id":"3daaa359-70f8-451a-948e-5bce64677304","block_type":"box","text":"“Investor C Conversions”).","page_number":150,"box":{"x":70,"y":876,"width":186,"height":11}},{"id":"417a0f84-73ec-4a2e-809a-adebddf50a73","block_type":"box","text":"II-106","page_number":150,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"533ddd3d-b20a-4a24-b817-c9fda502fe41","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":150,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"f1738fba-bfa7-480d-99b5-c27f74e0270a","block_type":"box","text":"The Investor C Conversions will occur at least once each month (on the “Investor C Conversion Date”) on the","page_number":151,"box":{"x":101,"y":45,"width":776,"height":11}},{"id":"db6cdc25-d23f-42e9-b2ef-dffda68b0c97","block_type":"box","text":"basis of the relative NAV of the shares of the two applicable classes on the Investor C Conversion Date, without the","page_number":151,"box":{"x":69,"y":60,"width":824,"height":11}},{"id":"4fda5359-6a67-4e8e-8e2f-7788d51ccfae","block_type":"box","text":"imposition of any sales load, fee or other charge. The Investor C Conversions will not be deemed a purchase or sale","page_number":151,"box":{"x":70,"y":75,"width":827,"height":11}},{"id":"26f2b311-8e02-4bda-a4c0-320205bcece4","block_type":"box","text":"of the shares for U.S. federal income tax purposes. Shares acquired through reinvestment of dividends on Investor C","page_number":151,"box":{"x":69,"y":90,"width":833,"height":11}},{"id":"cdf90cfa-d96c-4965-b80c-96335c93e740","block_type":"box","text":"Shares will also conver t automatically to Investor A Shares, as set for th in each Fund’s Prospectus. The Investor C","page_number":151,"box":{"x":69,"y":105,"width":818,"height":11}},{"id":"f168a4d9-5167-488b-982a-2852baa1bd65","block_type":"box","text":"Conversion Date for dividend reinvestment shares will be calculated taking into account the length of time the shares","page_number":151,"box":{"x":69,"y":120,"width":836,"height":12}},{"id":"d02e856e-16be-4796-a629-9fac052c0b2a","block_type":"box","text":"underlying the dividend reinvestment shares were outstanding.","page_number":151,"box":{"x":69,"y":136,"width":445,"height":11}},{"id":"57367012-fbc5-4fbb-9a6d-ad15793e5dd8","block_type":"box","text":"Contingent Deferred Sales Charge — Investor C Shares","page_number":151,"box":{"x":102,"y":158,"width":396,"height":11}},{"id":"9ee540fb-f470-4c3a-b4f6-a0df9fb225c9","block_type":"box","text":"Investor C Shares that are redeemed within one year of purchase may be subject to a 1.00% CDSC charged as a","page_number":151,"box":{"x":102,"y":181,"width":804,"height":11}},{"id":"1950fa41-7463-4e41-9299-705b3c067493","block_type":"box","text":"percentage of the dollar amount subject thereto. In determining whether an Investor C Shares CDSC is applicable to","page_number":151,"box":{"x":70,"y":196,"width":826,"height":11}},{"id":"e41ff777-7338-4538-a339-6e7157c94e71","block_type":"box","text":"a redemption, the calculation will be determined in the manner that results in the lowest possible rate being charged.","page_number":151,"box":{"x":69,"y":211,"width":837,"height":11}},{"id":"63174e9d-33df-46de-b6a3-3fdfa43b6e30","block_type":"box","text":"The charge will be assessed on an amount equal to the lesser of the proceeds of redemption or the cost of the","page_number":151,"box":{"x":68,"y":226,"width":795,"height":11}},{"id":"634454b2-b481-42fc-aee2-4c6dbb2d97a9","block_type":"box","text":"shares being redeemed. Accordingly, no CDSC will be imposed on increases in NAV above the initial purchase price of","page_number":151,"box":{"x":69,"y":241,"width":840,"height":11}},{"id":"86c2d686-5151-4a26-b4ad-c249d72aacf5","block_type":"box","text":"Investor C Shares. In addition, no CDSC will be assessed on Investor C Shares acquired through reinvestment of","page_number":151,"box":{"x":70,"y":256,"width":804,"height":12}},{"id":"3b838541-16cc-4bc7-9c65-0df5da8f15aa","block_type":"box","text":"dividends. It will be assumed that the redemption is first of shares held for over one year or shares acquired","page_number":151,"box":{"x":69,"y":271,"width":772,"height":12}},{"id":"602a84ad-3935-4cbc-a67d-da85cb2741ee","block_type":"box","text":"pursuant to reinvestment of dividends and then of shares held longest during the one-year period. A transfer of","page_number":151,"box":{"x":70,"y":286,"width":790,"height":12}},{"id":"eeebc9e3-2b2a-421c-a722-1ce3fa74833a","block_type":"box","text":"shares from a shareholder’s account to another account will be assumed to be made in the same order as a","page_number":151,"box":{"x":69,"y":302,"width":776,"height":9}},{"id":"13166d18-4e8a-4574-b7ed-340a45d9e852","block_type":"box","text":"redemption.","page_number":151,"box":{"x":69,"y":317,"width":83,"height":11}},{"id":"9d42b95d-1a8d-4bb8-9ca3-9cff826c3f24","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Par t I of each Fund’s SAI for","page_number":151,"box":{"x":102,"y":339,"width":734,"height":12}},{"id":"ab6358c5-4258-429c-81e6-a70bbabe126f","block_type":"box","text":"information about amounts paid to the Distributor in connection with CDSC shares for the periods indicated.","page_number":151,"box":{"x":70,"y":355,"width":769,"height":11}},{"id":"8c280c5c-32c3-409d-86a6-272a6dec815d","block_type":"box","text":"Investor C Shares — Contingent Deferred Sales Charge Waivers and Reductions","page_number":151,"box":{"x":102,"y":377,"width":572,"height":12}},{"id":"4df85d5e-2565-49b5-a416-8789ad638bdc","block_type":"box","text":"The CDSC on Investor C Shares is not charged in connection with: (1) redemptions of Investor C Shares","page_number":151,"box":{"x":101,"y":400,"width":740,"height":11}},{"id":"08faa1a3-a1d8-4459-94ef-629ed0e0deec","block_type":"box","text":"purchased through cer tain employer-sponsored retirement plans and fee-based programs previously approved by","page_number":151,"box":{"x":70,"y":415,"width":802,"height":11}},{"id":"1a363d4b-af8a-46ee-b302-86c327ea8f70","block_type":"box","text":"cer tain Funds and rollovers of current investments in the Fund through such plans; (2) exchanges described in","page_number":151,"box":{"x":69,"y":430,"width":786,"height":11}},{"id":"1e54f632-a8e6-445e-897d-bce561a70538","block_type":"box","text":"“Exchange Privilege” below; (3) redemptions made in connection with minimum required distributions due to the","page_number":151,"box":{"x":70,"y":445,"width":797,"height":12}},{"id":"196e251f-0eb2-489a-8da9-c02736b3102b","block_type":"box","text":"shareholder reaching age 72 from IRA and 403(b)(7) accounts; (4) redemptions made with respect to cer tain","page_number":151,"box":{"x":69,"y":460,"width":776,"height":12}},{"id":"4530d318-f9e4-43f4-9f03-c5007de00613","block_type":"box","text":"retirement plans sponsored by the Fund, BlackRock or its affiliates; (5) redemptions in connection with a","page_number":151,"box":{"x":69,"y":475,"width":747,"height":12}},{"id":"1fc3b370-7571-4533-b46a-482800a4ac63","block_type":"box","text":"shareholder’s death as long as the waiver request is made within one year of death or, if later, reasonably promptly","page_number":151,"box":{"x":69,"y":491,"width":822,"height":11}},{"id":"444b5e23-a766-4e4c-a66a-9fa8560481e6","block_type":"box","text":"following completion of probate (including in connection with the distribution of account assets to a beneficiary of the","page_number":151,"box":{"x":68,"y":506,"width":836,"height":11}},{"id":"277c7b47-8982-4a23-a407-adbe542cd0eb","block_type":"box","text":"decedent) or disability (as defined in the Code) subsequent to the purchase of Investor C Shares; (6) withdrawals","page_number":151,"box":{"x":69,"y":521,"width":806,"height":11}},{"id":"4e534a3d-6fb5-42ca-8752-68079e0a2adf","block_type":"box","text":"resulting from shareholder disability (as defined in the Code) as long as the disability arose subsequent to the","page_number":151,"box":{"x":69,"y":536,"width":786,"height":11}},{"id":"fb24a757-ce6c-43bc-89b5-63a5c31374e2","block_type":"box","text":"purchase of the shares; (7) involuntary redemptions of Investor C Shares in accounts with low balances as described","page_number":151,"box":{"x":70,"y":551,"width":834,"height":11}},{"id":"3a84ec49-d779-4d5d-802d-bdcc448b08ed","block_type":"box","text":"in “Redemption of Shares” below; (8) redemptions made pursuant to a systematic withdrawal plan, subject to the","page_number":151,"box":{"x":70,"y":566,"width":809,"height":11}},{"id":"7975883c-378a-420a-8e38-3eaed4ac1847","block_type":"box","text":"limitations set for th under “Systematic Withdrawal Plan” below; (9) redemptions related to the payment of BNY","page_number":151,"box":{"x":70,"y":581,"width":791,"height":11}},{"id":"d18bb90b-73e9-462d-8547-0da868253684","block_type":"box","text":"Mellon Investment Servicing Trust Company custodial IRA fees; and (10) redemptions when a shareholder can","page_number":151,"box":{"x":70,"y":596,"width":784,"height":12}},{"id":"0a620ec3-da45-4595-95d2-02c5afa16098","block_type":"box","text":"demonstrate hardship, in the absolute discretion of the Fund. In addition, no CDSC is charged on Investor C Shares","page_number":151,"box":{"x":69,"y":612,"width":824,"height":11}},{"id":"c10fceb6-1523-4870-adfd-3c8c752967f6","block_type":"box","text":"acquired through the reinvestment of dividends or distributions.","page_number":151,"box":{"x":69,"y":627,"width":451,"height":11}},{"id":"3d846754-e430-427b-9be8-6eba0d851291","block_type":"box","text":"Cer tain CDSC waivers and reductions on Investor C Shares may be available to customers of cer tain financial","page_number":151,"box":{"x":102,"y":649,"width":781,"height":12}},{"id":"69bd61ae-84e9-414a-b7d4-071338a50d0b","block_type":"box","text":"intermediaries, as described under “Intermediary-Defined Sales Charge Waiver Policies” in the Fund’s Prospectus.","page_number":151,"box":{"x":70,"y":664,"width":813,"height":12}},{"id":"f723ce70-a64d-4628-84ba-691a5757fd5a","block_type":"box","text":"Please speak to your financial intermediary for more information.","page_number":151,"box":{"x":69,"y":680,"width":462,"height":11}},{"id":"5efd7737-94b9-4853-84c3-456a40eba0de","block_type":"box","text":"Class R Shares","page_number":151,"box":{"x":69,"y":710,"width":110,"height":9}},{"id":"3b1fb7f0-7c5c-4dd2-8552-40e8d800fdbd","block_type":"box","text":"Cer tain of the Funds offer Class R Shares as described in each such Fund’s Prospectus. Class R Shares are","page_number":151,"box":{"x":102,"y":732,"width":775,"height":11}},{"id":"4be60421-d1c0-449e-8baa-145abba305a3","block_type":"box","text":"available only to cer tain employer-sponsored retirement plans. Class R Shares are not subject to an initial sales","page_number":151,"box":{"x":69,"y":748,"width":799,"height":11}},{"id":"bbca58c0-335f-4018-b3e7-7da86c6b4e00","block_type":"box","text":"charge or a CDSC but are subject to an ongoing distribution fee of 0.25% per year and an ongoing service fee of","page_number":151,"box":{"x":69,"y":763,"width":801,"height":11}},{"id":"7e1fdba1-c5b4-44e3-8580-1be3e9eef4b1","block_type":"box","text":"0.25% per year. Distribution fees are used to suppor t the Fund’s marketing and distribution effor ts, such as","page_number":151,"box":{"x":69,"y":778,"width":772,"height":11}},{"id":"44c6de5a-6d4d-495a-89cd-744efe49299d","block_type":"box","text":"compensating financial advisers and other financial intermediaries, adver tising and promotion. Service fees are used","page_number":151,"box":{"x":69,"y":793,"width":836,"height":11}},{"id":"1c510853-f0b4-4f2b-872f-eae393fee03b","block_type":"box","text":"to compensate securities dealers and other financial intermediaries for service activities.","page_number":151,"box":{"x":68,"y":808,"width":636,"height":11}},{"id":"2a7c90b6-24af-4ace-be48-7b42033dc209","block_type":"box","text":"If Class R Shares are held over time, these fees may exceed the maximum sales charge that an investor would","page_number":151,"box":{"x":102,"y":831,"width":791,"height":11}},{"id":"d66d9feb-3683-4316-9c35-29128db24c52","block_type":"box","text":"have paid as a shareholder of one of the other share classes.","page_number":151,"box":{"x":69,"y":846,"width":440,"height":11}},{"id":"65a35355-3fe5-4d63-9416-7a7a4b12a270","block_type":"box","text":"II-107","page_number":151,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"37e12e3f-2050-439d-8fa7-bcbb5e5e5b6a","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":151,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"3867da0e-702a-4c8e-8abb-160ab9e7d94d","block_type":"box","text":"Class K Shares","page_number":152,"box":{"x":69,"y":45,"width":109,"height":9}},{"id":"90d525cc-a9c5-4c38-8648-582e52193bc3","block_type":"box","text":"Cer tain Funds offer Class K Shares as described in each such Fund’s Prospectus. Class K Shares are available","page_number":152,"box":{"x":102,"y":67,"width":797,"height":11}},{"id":"b9e6b9c3-c546-4a48-af1a-e0e157dd7916","block_type":"box","text":"only to (i) cer tain employee benefit plans, such as health savings accounts, and cer tain employer-sponsored","page_number":152,"box":{"x":69,"y":82,"width":772,"height":12}},{"id":"9cb36d9b-709b-4c47-b484-feedc8e2b09c","block_type":"box","text":"retirement plans (not including SEP IRAs, SIMPLE IRAs and SARSEPs) (collectively, “Employer-Sponsored Retirement","page_number":152,"box":{"x":69,"y":98,"width":827,"height":11}},{"id":"e482f4bf-b114-4d11-a922-0736cc8a2ec2","block_type":"box","text":"Plans”), (ii) collective trust funds, investment companies and other pooled investment vehicles, each of which may","page_number":152,"box":{"x":69,"y":113,"width":817,"height":11}},{"id":"05eda13e-de1d-4489-bb3c-0a84d3e94021","block_type":"box","text":"purchase shares of the Fund through a financial intermediary that has entered into an agreement with the Distributor","page_number":152,"box":{"x":70,"y":128,"width":834,"height":11}},{"id":"b01c4c27-e31f-46ac-89d3-2b0ea9aaa497","block_type":"box","text":"to purchase such shares, (iii) “Institutional Investors,” which include but are not limited to, endowments,","page_number":152,"box":{"x":68,"y":143,"width":748,"height":11}},{"id":"52421087-a22f-4dde-9f11-a32c592ba351","block_type":"box","text":"foundations, family offices, banks and bank trusts, local, city, and state governmental institutions, corporations and","page_number":152,"box":{"x":68,"y":158,"width":828,"height":11}},{"id":"0501adbc-9a74-4bc0-921e-81535b51beb0","block_type":"box","text":"insurance company separate accounts, each of which may purchase shares of the Fund through a financial","page_number":152,"box":{"x":70,"y":173,"width":760,"height":11}},{"id":"6393d191-ccd4-459f-9895-1dabb3d276b1","block_type":"box","text":"intermediary that has entered into an agreement with the Distributor to purchase such shares, (iv) clients of private","page_number":152,"box":{"x":70,"y":188,"width":823,"height":12}},{"id":"6b995978-8cea-4cb0-8334-97e26290b2cb","block_type":"box","text":"banks that purchase shares of the Fund through a financial intermediary that has entered into an agreement with the","page_number":152,"box":{"x":69,"y":203,"width":836,"height":12}},{"id":"c3d273e1-2df5-4b36-9dea-b387ccb350a1","block_type":"box","text":"Distributor to sell such shares; (v) fee-based advisory platforms of a financial intermediary that (a) has specifically","page_number":152,"box":{"x":70,"y":218,"width":814,"height":12}},{"id":"71abb0a2-9f54-48a5-9428-2d4bffccf649","block_type":"box","text":"acknowledged in a written agreement with the Distributor and/or its affiliate(s) that the financial intermediary shall","page_number":152,"box":{"x":69,"y":234,"width":817,"height":11}},{"id":"64ba36b8-e2d4-4906-9c05-f23dacbad4f5","block_type":"box","text":"offer such shares to fee-based advisory clients through an omnibus account held at the Fund or (b) transacts in the","page_number":152,"box":{"x":69,"y":249,"width":823,"height":11}},{"id":"d46f0785-d2c5-4a34-b95f-a336e472a1fd","block_type":"box","text":"Fund’s shares through another intermediary that has executed such an agreement and (vi) any other investors who","page_number":152,"box":{"x":70,"y":264,"width":818,"height":11}},{"id":"19f0f4e6-f707-4a86-b487-487aed883756","block_type":"box","text":"met the eligibility criteria for BlackRock Shares or Class K Shares prior to August 15, 2016 and have continually held","page_number":152,"box":{"x":69,"y":279,"width":833,"height":11}},{"id":"f176f8b8-df31-4b29-af35-3b2a95b34224","block_type":"box","text":"Class K Shares of the Fund or the respective Predecessor Fund in the same account since August 15, 2016. The","page_number":152,"box":{"x":69,"y":294,"width":807,"height":11}},{"id":"6157c6de-d6fa-4c62-8f36-42f60d22f1f0","block_type":"box","text":"agreement referenced in (iv) above shall appear in a supplemental agreement to any selling, sub-transfer agent, or","page_number":152,"box":{"x":69,"y":309,"width":817,"height":11}},{"id":"0b264f19-38ff-4ab1-831f-8992d6c43046","block_type":"box","text":"distribution and marketing agreement.","page_number":152,"box":{"x":69,"y":325,"width":270,"height":11}},{"id":"cf39eecb-9d0b-4e73-9d74-b0bac5153bfe","block_type":"box","text":"Class K Shares are also available to employees, officers and directors/trustees of BlackRock, Inc. and","page_number":152,"box":{"x":102,"y":347,"width":734,"height":11}},{"id":"57c2bf33-a953-4c41-97d3-c4f12a73f110","block_type":"box","text":"BlackRock Funds and immediate family members of such persons, if they open an account directly with BlackRock.","page_number":152,"box":{"x":70,"y":362,"width":817,"height":11}},{"id":"cffb915c-d9c9-41f2-9881-726ce659d185","block_type":"box","text":"Eligible individuals who would like to conver t existing holdings to Class K Shares must contact BlackRock.","page_number":152,"box":{"x":70,"y":377,"width":753,"height":12}},{"id":"a0e9edd8-c4c4-470a-83f9-b7ca26fbbf76","block_type":"box","text":"Class G Shares","page_number":152,"box":{"x":69,"y":408,"width":110,"height":8}},{"id":"a982fa57-6972-45b3-b59a-836658e7ccf8","block_type":"box","text":"Cer tain Funds offer Class G Shares, which are available only to investors on eligible platforms. Eligible platforms","page_number":152,"box":{"x":102,"y":430,"width":804,"height":11}},{"id":"9a58ba7a-3a1c-4a7e-934e-b86606036121","block_type":"box","text":"are those where clients invest in the Fund through a single omnibus account in the name of a financial intermediary","page_number":152,"box":{"x":69,"y":445,"width":826,"height":12}},{"id":"1a30ad5b-a1c6-4014-ad88-3b3a336af767","block_type":"box","text":"that meets an initial investment minimum of $2 billion. For clients investing through such eligible platforms, the Fund","page_number":152,"box":{"x":68,"y":460,"width":836,"height":12}},{"id":"ef0efafe-40fd-43ec-ba82-5050365086b6","block_type":"box","text":"does not impose investment minimums on any individual investor. Financial intermediaries may impose separate","page_number":152,"box":{"x":69,"y":476,"width":803,"height":11}},{"id":"6fb544bb-d164-45ae-8fbe-1f730d28d619","block_type":"box","text":"eligibility requirements.","page_number":152,"box":{"x":69,"y":491,"width":164,"height":11}},{"id":"c1271b40-3a50-4747-a96c-60824ff475f0","block_type":"box","text":"Service Shares","page_number":152,"box":{"x":68,"y":521,"width":109,"height":9}},{"id":"554ae4fd-e3e2-4bff-98cf-0f0c9792d4bc","block_type":"box","text":"Cer tain Funds offer Service Shares, which are available only to cer tain investors, including: (i) cer tain financial","page_number":152,"box":{"x":102,"y":543,"width":788,"height":12}},{"id":"d33960b3-88a7-41d1-8298-0132b00c8f73","block_type":"box","text":"institutions, such as banks and brokerage firms, acting on behalf of their customers; (ii) cer tain persons who were","page_number":152,"box":{"x":70,"y":559,"width":815,"height":11}},{"id":"4ce94da9-919a-4983-9dac-82f6b29693a7","block_type":"box","text":"shareholders of the Compass Capital Group of Funds at the time of its combination with The PNC","page_number":152,"box":{"x":69,"y":574,"width":693,"height":11}},{"id":"abbd2f0f-5fe9-4ab9-b118-69a330cdc60b","block_type":"box","text":"®","page_number":152,"box":{"x":763,"y":574,"width":6,"height":5}},{"id":"94b9bb69-5dc0-4d88-be15-a83df2ce99b4","block_type":"box","text":"Fund in 1996; and","page_number":152,"box":{"x":775,"y":574,"width":130,"height":10}},{"id":"41771294-268b-49ba-a553-3f91ec4eda83","block_type":"box","text":"(iii) par ticipants in the Capital Directions","page_number":152,"box":{"x":69,"y":589,"width":287,"height":11}},{"id":"d3582a06-0727-4476-a851-4aaaddc9c3ea","block_type":"box","text":"SM","page_number":152,"box":{"x":357,"y":589,"width":11,"height":5}},{"id":"84a420f6-d43b-4699-97e6-01149dee1aca","block_type":"box","text":"asset allocation program. Service Shares are not subject to an initial sales","page_number":152,"box":{"x":374,"y":589,"width":534,"height":11}},{"id":"3fceb58d-661c-4803-acba-bf6707970e2f","block_type":"box","text":"charge or a CDSC but are subject to an ongoing service fee as set for th in the applicable Fund’s Prospectus.","page_number":152,"box":{"x":69,"y":604,"width":776,"height":11}},{"id":"bf2606cc-98e2-49e2-ae74-2a15b467295d","block_type":"box","text":"BlackRock Shares","page_number":152,"box":{"x":69,"y":634,"width":133,"height":9}},{"id":"a52e4302-47df-4267-9105-d4154e94ae14","block_type":"box","text":"Cer tain Funds offer BlackRock Shares, which are available only to cer tain investors. BlackRock Shares are","page_number":152,"box":{"x":102,"y":657,"width":760,"height":11}},{"id":"a20b85a6-8d51-441a-9d33-740e36bb9d4c","block_type":"box","text":"offered without a sales charge to institutional and individual investors, registered investment advisers and cer tain","page_number":152,"box":{"x":69,"y":672,"width":813,"height":11}},{"id":"139ff2fb-a5a4-4d39-a186-787e176048b1","block_type":"box","text":"fee-based programs.","page_number":152,"box":{"x":68,"y":687,"width":145,"height":11}},{"id":"0053f296-2d27-49ff-a761-925a3adfa56e","block_type":"box","text":"Distribution and/or Shareholder Servicing Plans","page_number":152,"box":{"x":69,"y":718,"width":348,"height":11}},{"id":"fc6aac23-479f-4b33-ba30-5313ecdc6555","block_type":"box","text":"Each Fund has adopted a plan (each, a “Plan”) pursuant to Rule 12b-1 under the Investment Company Act with","page_number":152,"box":{"x":102,"y":740,"width":790,"height":11}},{"id":"311038f9-2eec-4380-9810-b95ac6fb1cca","block_type":"box","text":"respect to cer tain share classes that allows the Fund to pay distribution fees for the sale of its shares and","page_number":152,"box":{"x":69,"y":755,"width":761,"height":11}},{"id":"59920fbe-1989-4ed1-977f-a2868dbe3030","block_type":"box","text":"shareholder servicing fees for cer tain services provided to its shareholders.","page_number":152,"box":{"x":69,"y":770,"width":541,"height":12}},{"id":"bea9079a-ac0b-42e3-bc94-526b796fb0cf","block_type":"box","text":"Pursuant to the Plans, a Fund may pay BRIL and/or BlackRock, or any other affiliate or significant shareholder of","page_number":152,"box":{"x":102,"y":793,"width":803,"height":11}},{"id":"14b73d64-10fa-49f2-909a-7d1430a98168","block_type":"box","text":"BlackRock, fees for distribution and sales suppor t services with respect to Investor A, Investor A1, Investor C,","page_number":152,"box":{"x":70,"y":808,"width":783,"height":11}},{"id":"51a18a8a-9398-4e70-9dce-fc2ee497a965","block_type":"box","text":"Investor P, Service and Class R Shares. Currently, as described fur ther below, only Investor C and Class R Shares","page_number":152,"box":{"x":70,"y":823,"width":809,"height":11}},{"id":"e7eada05-73c5-4953-b5af-94078331db2e","block_type":"box","text":"bear the expense of distribution fees under a Plan.","page_number":152,"box":{"x":69,"y":838,"width":360,"height":11}},{"id":"a0d24f02-5020-4d7d-9fd2-58ab683b93ca","block_type":"box","text":"Each Fund has entered into a distribution agreement with BRIL under which BRIL, as agent, offers shares of","page_number":152,"box":{"x":102,"y":861,"width":770,"height":11}},{"id":"f53c3a39-ff75-4f51-848b-8c8bff511086","block_type":"box","text":"each Fund on a continuous basis. BRIL has agreed to use appropriate effor ts to effect sales of the shares, but it is","page_number":152,"box":{"x":69,"y":876,"width":824,"height":11}},{"id":"475183e8-6ebb-4e8f-9e2a-f635b62531fa","block_type":"box","text":"not obligated to sell any par ticular amount of shares. BRIL’s principal business address is 50 Hudson Yards, New","page_number":152,"box":{"x":69,"y":891,"width":812,"height":12}},{"id":"a2783e91-24af-45e2-a5d3-cc4d42a98176","block_type":"box","text":"York, NY 10001. BRIL is an affiliate of BlackRock.","page_number":152,"box":{"x":68,"y":906,"width":355,"height":11}},{"id":"6d4d97ad-15f6-4508-abb5-d93c5cf62350","block_type":"box","text":"II-108","page_number":152,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"92fd4974-836d-4a44-ac3e-8165e703f840","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":152,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"9d164b40-9c6e-426e-8abc-6c10e503b98a","block_type":"box","text":"Pursuant to the Plans, each Fund may also pay shareholder servicing fees (also referred to as general","page_number":153,"box":{"x":102,"y":45,"width":727,"height":11}},{"id":"d23916a4-61e9-45a0-803b-63e4262bd68d","block_type":"box","text":"shareholder liaison services fees) to affiliated and unaffiliated brokers, dealers, financial institutions, insurance","page_number":153,"box":{"x":69,"y":60,"width":799,"height":11}},{"id":"11bd5df1-437f-4989-be83-c08270b91102","block_type":"box","text":"companies, retirement plan record-keepers and other financial intermediaries (including BlackRock, BRIL and their","page_number":153,"box":{"x":69,"y":75,"width":813,"height":11}},{"id":"5d9c8511-15b8-4f93-9c2d-5ac4add5b049","block_type":"box","text":"affiliates) (collectively, “Service Organizations”) for cer tain suppor t services rendered by Service Organizations to","page_number":153,"box":{"x":69,"y":90,"width":809,"height":11}},{"id":"1cfd0a51-6959-469c-afd0-95fae193af04","block_type":"box","text":"their customers (“Customers”) who are the beneficial owners of Investor A, Investor A1, Investor C, Investor P,","page_number":153,"box":{"x":68,"y":105,"width":786,"height":11}},{"id":"9b4797d0-e3a3-4b75-b3c0-d8754d1de322","block_type":"box","text":"Service and Class R Shares of a Fund. Such services are intended to supplement the services provided by the","page_number":153,"box":{"x":69,"y":120,"width":789,"height":11}},{"id":"c04b3338-16ff-465e-89de-6202a911b4d9","block_type":"box","text":"Fund’s Administrators and Transfer Agent to the Fund’s shareholders of record.","page_number":153,"box":{"x":70,"y":135,"width":562,"height":12}},{"id":"b6520d8f-8838-4f12-9ce8-a4838e02235e","block_type":"box","text":"The suppor t services provided by Service Organizations are general shareholder liaison services, which include,","page_number":153,"box":{"x":101,"y":158,"width":798,"height":11}},{"id":"44604c8f-f7ca-4e98-a5e3-6ab0d263ec7e","block_type":"box","text":"but are not limited to: (i) answering Customer inquiries regarding account status and history, the manner in which","page_number":153,"box":{"x":69,"y":173,"width":808,"height":11}},{"id":"3dcea79d-0e60-4769-b9f7-36bf2516c288","block_type":"box","text":"purchases, exchanges and redemptions or repurchases of shares may be effected and cer tain other matters","page_number":153,"box":{"x":70,"y":188,"width":776,"height":12}},{"id":"a44bad0e-f8ef-4726-972d-ca31e61d8c67","block_type":"box","text":"per taining to the Customers’ investments; and (ii) assisting Customers in designating and changing dividend options,","page_number":153,"box":{"x":70,"y":203,"width":835,"height":12}},{"id":"77d1a146-759c-4d87-b178-ad08c1fa8a8c","block_type":"box","text":"account designations and addresses. The shareholder servicing fees payable pursuant to the Plans are paid to","page_number":153,"box":{"x":69,"y":218,"width":791,"height":12}},{"id":"d8d0a7bd-bfdb-427a-948e-695cf92b4df0","block_type":"box","text":"compensate Service Organizations for the administration and servicing of shareholder accounts and are not costs","page_number":153,"box":{"x":69,"y":234,"width":813,"height":11}},{"id":"eba80ee9-86a1-495b-9cd8-643f170e30bc","block_type":"box","text":"which are primarily intended to result in the sale of the Fund’s shares.","page_number":153,"box":{"x":68,"y":249,"width":501,"height":11}},{"id":"11a60989-705a-4433-a96e-4811d1ac9ae4","block_type":"box","text":"Payments under the Plans are based on a percentage of average daily net assets attributable to the shares in","page_number":153,"box":{"x":102,"y":271,"width":783,"height":12}},{"id":"b597a594-f469-48d1-be0a-dfdcc85b7a5d","block_type":"box","text":"the applicable share class regardless of the amount of expenses incurred. As a result, payments under the Plans","page_number":153,"box":{"x":68,"y":286,"width":810,"height":12}},{"id":"addc17fb-4cb0-408b-a52e-1d101c753492","block_type":"box","text":"may be more or less than expenses incurred in connection with providing distribution and/or shareholder services","page_number":153,"box":{"x":69,"y":302,"width":813,"height":11}},{"id":"e0df2aa8-b7a8-4036-a751-579f683caab4","block_type":"box","text":"with respect to the related class. Information with respect to the payments under the Plans and expenses incurred in","page_number":153,"box":{"x":68,"y":317,"width":836,"height":11}},{"id":"84f617a7-d836-40b8-9134-c5dfcce7ebf9","block_type":"box","text":"providing services with respect to the related class is presented to the Directors for their consideration quar terly.","page_number":153,"box":{"x":70,"y":332,"width":805,"height":11}},{"id":"8c2f7ceb-aa9b-43c2-a72e-44b2e17e1018","block_type":"box","text":"Payments under the Plans consist of the shareholder servicing fees and the distribution fees. Expenses with respect","page_number":153,"box":{"x":69,"y":347,"width":832,"height":11}},{"id":"e4990321-302a-4bf6-b6ba-5cfc8db53151","block_type":"box","text":"to providing distribution and/or shareholder services with respect to a class may consist of Service Organization","page_number":153,"box":{"x":68,"y":362,"width":803,"height":11}},{"id":"93e0f338-4d15-4000-8e98-a7ef02bce2c4","block_type":"box","text":"financial adviser compensation, branch office and regional operation center selling and transaction processing","page_number":153,"box":{"x":68,"y":377,"width":788,"height":12}},{"id":"3f08a86c-049d-4619-ae3e-8bc37b12725a","block_type":"box","text":"expenses, adver tising, sales promotion and marketing expenses. Payments under the Plans with respect to one","page_number":153,"box":{"x":69,"y":393,"width":798,"height":11}},{"id":"30ed955e-1aa7-4ebe-8f31-078e87ef2704","block_type":"box","text":"class will not be used to finance the expenditures of another class. Sales personnel may receive different","page_number":153,"box":{"x":69,"y":407,"width":755,"height":12}},{"id":"a6ea2069-2520-4d9b-bb79-88c73260984f","block_type":"box","text":"compensation for selling different classes of shares.","page_number":153,"box":{"x":69,"y":423,"width":375,"height":11}},{"id":"e0c3d161-a5c9-4456-a678-14e45a50f9c9","block_type":"box","text":"Each Plan is subject to the provisions of Rule 12b-1 under the Investment Company Act. In their consideration of","page_number":153,"box":{"x":102,"y":445,"width":803,"height":11}},{"id":"8d9eb548-f997-43bf-abb8-3a43416dbb64","block_type":"box","text":"a Plan, the Directors must consider all factors they deem relevant, including information as to the benefits of the Plan","page_number":153,"box":{"x":69,"y":460,"width":839,"height":12}},{"id":"5626eebe-24bc-4a4f-9f68-64eee98486e2","block_type":"box","text":"to the Fund and the related class of shareholders. In approving a Plan in accordance with Rule 12b-1, the non","page_number":153,"box":{"x":68,"y":475,"width":788,"height":12}},{"id":"9ecf55c6-2536-4db3-a588-e6b5f8fe5138","block_type":"box","text":"interested Directors concluded that there is reasonable likelihood that the Plan will benefit the Fund and its related","page_number":153,"box":{"x":70,"y":491,"width":818,"height":9}},{"id":"b8711723-2a25-4f28-809e-6d7ef5dd159e","block_type":"box","text":"class of shareholders. The Plan provides, among other things, that: (i) the Board of Directors shall receive quar terly","page_number":153,"box":{"x":69,"y":506,"width":824,"height":11}},{"id":"d2625b1d-20fc-4dad-af45-1dd2cc15801e","block_type":"box","text":"repor ts regarding the amounts expended under the Plan and the purposes for which such expenditures were made;","page_number":153,"box":{"x":69,"y":521,"width":821,"height":11}},{"id":"170f0869-268b-482e-aaca-b3b4627f3048","block_type":"box","text":"(ii) the Plan will continue in effect for so long as its continuance is approved at least annually by the Board of","page_number":153,"box":{"x":69,"y":536,"width":778,"height":11}},{"id":"11eb0ee4-e8ee-410c-a9b6-a2dfb70c270a","block_type":"box","text":"Directors, including the directors who are not “interested persons” of the Fund (as defined in the Investment","page_number":153,"box":{"x":70,"y":551,"width":773,"height":11}},{"id":"9eeb6bae-575f-4174-8f72-c58d6d534d9e","block_type":"box","text":"Company Act) and who have no direct or indirect financial interest in the operation of the Plan or any agreement","page_number":153,"box":{"x":69,"y":566,"width":796,"height":11}},{"id":"2fee336b-ec2c-41d0-8f30-b62e7e24a08d","block_type":"box","text":"entered into in connection with the Plan (the “12b-1 Directors”), acting in person at a meeting called for said purpose","page_number":153,"box":{"x":69,"y":581,"width":837,"height":12}},{"id":"6af995de-f2b7-4604-ac68-cef730612d0d","block_type":"box","text":"in accordance with Rule 12b-1 under the Investment Company Act; (iii) any material amendment thereto must be","page_number":153,"box":{"x":70,"y":597,"width":801,"height":11}},{"id":"41e4c039-a6a7-4d96-a8e6-a1d6cfc12ccc","block_type":"box","text":"approved by the Board of Directors, including the 12b-1 Directors, acting in person at a meeting called for said","page_number":153,"box":{"x":69,"y":612,"width":787,"height":11}},{"id":"bef22585-b84d-482e-97bc-08448c7e97a8","block_type":"box","text":"purpose; (iv) any amendment to increase materially the costs which any class of shares may bear for distribution","page_number":153,"box":{"x":70,"y":627,"width":802,"height":11}},{"id":"5866ce2a-92f7-4fad-8db1-656ad5e515f7","block_type":"box","text":"services pursuant to the Plan shall be effective only upon approval by a vote of a majority of the outstanding shares","page_number":153,"box":{"x":69,"y":642,"width":826,"height":11}},{"id":"34e65a7c-7ede-43e6-b4e7-eb3b062accf4","block_type":"box","text":"of such class and by a majority of the Board of Directors, including the 12b-1 Directors, acting in person at a meeting","page_number":153,"box":{"x":69,"y":657,"width":836,"height":11}},{"id":"912fdf2e-58ff-46fc-915f-c65e59c804b1","block_type":"box","text":"called for said purpose; and (v) while the Plan remains in effect, the selection and nomination of the Fund’s Directors","page_number":153,"box":{"x":69,"y":672,"width":836,"height":11}},{"id":"7965a4b3-c5a0-433a-a570-75d28a3af5fc","block_type":"box","text":"who are not “interested persons” of the Fund shall be committed to the discretion of the Fund’s non-interested","page_number":153,"box":{"x":68,"y":687,"width":792,"height":11}},{"id":"206f6641-f220-4940-9e93-07b65c0a2a46","block_type":"box","text":"Directors. Rule 12b-1 fur ther requires that each Fund preserve copies of each Plan and any repor t made pursuant to","page_number":153,"box":{"x":70,"y":702,"width":831,"height":11}},{"id":"d2f5c8f3-9491-4f55-bdfd-aaffbe1848a0","block_type":"box","text":"such Plan for a period of not less than six years from the date of the Plan or such repor t, the first two years in an","page_number":153,"box":{"x":69,"y":717,"width":807,"height":12}},{"id":"50aaea7c-452b-4bc6-9052-bff5d4cdbf8f","block_type":"box","text":"easily accessible place.","page_number":153,"box":{"x":69,"y":733,"width":167,"height":11}},{"id":"042e4fa0-a297-4516-b861-0cd67183b123","block_type":"box","text":"Each Plan is terminable as to any class of shares without penalty at any time by a vote of a majority of the 12b-1","page_number":153,"box":{"x":102,"y":755,"width":804,"height":11}},{"id":"540b23af-401a-4745-8e8e-fe9521741285","block_type":"box","text":"Directors, or by vote of the holders of a majority of the shares of such class.","page_number":153,"box":{"x":70,"y":770,"width":542,"height":11}},{"id":"8d1b5f11-55cb-48ec-a211-813b2828c689","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Par t I of each Fund’s SAI for","page_number":153,"box":{"x":102,"y":793,"width":734,"height":11}},{"id":"83340ed5-b35c-40f7-8c15-5ad6e06a63bd","block_type":"box","text":"information relating to the fees paid by your Fund to the Distributor under each Plan during the Fund’s most recent","page_number":153,"box":{"x":70,"y":808,"width":814,"height":11}},{"id":"3a05b0d5-aade-4b8f-adee-88be899b0ec7","block_type":"box","text":"fiscal year.","page_number":153,"box":{"x":68,"y":823,"width":75,"height":11}},{"id":"3588140c-8cd4-4168-abc8-b800c4eb90d5","block_type":"box","text":"Limitations on the Payment of Deferred Sales Charges","page_number":153,"box":{"x":69,"y":854,"width":396,"height":11}},{"id":"95fda831-7e86-4345-b73b-293df16c9ad2","block_type":"box","text":"The maximum sales charge rule in the Conduct Rules of the Financial Industry Regulatory Authority (“FINRA”)","page_number":153,"box":{"x":101,"y":876,"width":777,"height":11}},{"id":"206a1a56-efee-4344-86ac-a53d23329eb9","block_type":"box","text":"imposes a limitation on cer tain asset-based sales charges such as the distribution fee borne by Class R Shares, and","page_number":153,"box":{"x":70,"y":891,"width":835,"height":12}},{"id":"1b5674d3-2cbf-45f4-80b2-b1a804cda5cc","block_type":"box","text":"the distribution fee and the CDSC borne by the Investor C Shares. This limitation does not apply to the shareholder","page_number":153,"box":{"x":68,"y":906,"width":822,"height":12}},{"id":"07b5af45-e66d-4ec1-a264-c4bddb05c9ed","block_type":"box","text":"II-109","page_number":153,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"88509f7c-a71d-4dd4-9473-d9c898a7438e","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":153,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"01c464ae-c60c-4530-9181-5854b0d49ba2","block_type":"box","text":"servicing fee. The maximum sales charge rule is applied separately to each class and limits the aggregate of","page_number":154,"box":{"x":69,"y":45,"width":778,"height":11}},{"id":"165837cf-bcde-48b4-af93-c85a27efe0ab","block_type":"box","text":"distribution fee payments and CDSCs payable by a Fund to (1) 6.25% of eligible gross sales of Investor C and Class R","page_number":154,"box":{"x":69,"y":60,"width":840,"height":11}},{"id":"625f6f87-ec18-4c2d-93fa-252b4363355c","block_type":"box","text":"Shares, computed separately (excluding shares issued pursuant to dividend reinvestments and exchanges), plus","page_number":154,"box":{"x":69,"y":75,"width":803,"height":11}},{"id":"46c7bfba-79a9-4180-b148-17803ffca5a5","block_type":"box","text":"(2) interest on the unpaid balance for the respective class, computed separately, at the prime rate plus 1% (the","page_number":154,"box":{"x":69,"y":90,"width":794,"height":11}},{"id":"0eecd352-3242-475a-b4e6-b3f859bb0af4","block_type":"box","text":"unpaid balance being the maximum amount payable minus amounts received from the payment of the distribution fee","page_number":154,"box":{"x":69,"y":105,"width":839,"height":11}},{"id":"a86b20c6-052f-49a2-ade9-488a79eafe19","block_type":"box","text":"and the CDSC). See “Information on Sales Charges and Distribution Related Expenses” in Par t I of each Fund’s SAI","page_number":154,"box":{"x":69,"y":120,"width":824,"height":12}},{"id":"19735e94-7f3c-4293-bd0d-9cc87c1b0a2d","block_type":"box","text":"for comparative information as of your Fund’s most recent fiscal year end with respect to, if applicable, the Investor C","page_number":154,"box":{"x":68,"y":135,"width":839,"height":11}},{"id":"1b683770-b16a-4e8e-ad3f-aa910a3de120","block_type":"box","text":"and Class R Shares of your Fund.","page_number":154,"box":{"x":69,"y":150,"width":236,"height":12}},{"id":"d6bc12b5-f7a2-4287-8e05-ef6482527dee","block_type":"box","text":"Other Payments by the Fund","page_number":154,"box":{"x":69,"y":181,"width":206,"height":11}},{"id":"bab4dbf3-897d-4aac-96d8-c56af4bfaa88","block_type":"box","text":"In addition to shareholder servicing fees that a Fund may pay to a Service Organization pursuant to the Plan and","page_number":154,"box":{"x":102,"y":203,"width":800,"height":12}},{"id":"0b54a863-527b-4749-a352-0d3c37d9aa66","block_type":"box","text":"fees the Fund pays to its Transfer Agent, BlackRock, on behalf of a Fund, may enter into non-Plan agreements with","page_number":154,"box":{"x":68,"y":218,"width":816,"height":12}},{"id":"21df6cd3-1976-468b-ba9c-a3c4e5f0975e","block_type":"box","text":"Service Organizations pursuant to which the Fund will pay a Service Organization for administrative, networking,","page_number":154,"box":{"x":69,"y":234,"width":794,"height":11}},{"id":"b648d364-3788-40d5-a106-9ceaa5e9fb5f","block_type":"box","text":"recordkeeping, sub-transfer agency, sub-accounting and/or shareholder services. These non-Plan payments are","page_number":154,"box":{"x":69,"y":249,"width":792,"height":11}},{"id":"b79a67eb-d9c5-4107-99a0-0cf993283807","block_type":"box","text":"generally based on either (1) a percentage of the average daily net assets of Fund shareholders serviced by a Service","page_number":154,"box":{"x":68,"y":264,"width":841,"height":11}},{"id":"eac441a4-c7a2-4a85-a58c-3955cd5e9c64","block_type":"box","text":"Organization or (2) a fixed dollar amount for each account serviced by a Service Organization. The aggregate amount","page_number":154,"box":{"x":69,"y":279,"width":831,"height":11}},{"id":"9a7fb225-7ff1-4f03-8d77-b2e2da521850","block_type":"box","text":"of these payments may be substantial.","page_number":154,"box":{"x":69,"y":294,"width":276,"height":11}},{"id":"3bc46ed1-5ac7-4797-bf52-37daa1234843","block_type":"box","text":"Additional Payments by BlackRock","page_number":154,"box":{"x":68,"y":324,"width":256,"height":11}},{"id":"86c950fc-1d63-4e56-b3bd-578db7f909ef","block_type":"box","text":"From time to time, BlackRock, BRIL and/or their affiliates (referred to in this section collectively as “BlackRock”)","page_number":154,"box":{"x":102,"y":347,"width":803,"height":11}},{"id":"c2fef431-4751-48b9-95c8-3a21275754a5","block_type":"box","text":"may compensate Service Organizations for the sale and distribution of shares of a Fund, for services to a Fund and","page_number":154,"box":{"x":69,"y":362,"width":823,"height":11}},{"id":"42215345-191c-4504-aeff-1c8c767948e5","block_type":"box","text":"its shareholders and/or for data provision or technology suppor t. A Service Organization may per form these","page_number":154,"box":{"x":70,"y":377,"width":768,"height":12}},{"id":"bbecd097-3de1-486b-bc33-c8c381df0e16","block_type":"box","text":"obligations itself or may arrange for a third par ty to per form them. These payments, which are not made pursuant to","page_number":154,"box":{"x":69,"y":392,"width":830,"height":12}},{"id":"57ecd8a8-ff0a-4273-ade6-b6affb1715d0","block_type":"box","text":"a Plan or otherwise paid by a Fund, are referred to as “Additional Payments” herein.","page_number":154,"box":{"x":69,"y":407,"width":599,"height":12}},{"id":"2a080d46-de67-43d6-918b-f7a82d78b6be","block_type":"box","text":"Additional Payments are made from BlackRock’s own assets (which may come directly or indirectly from fees","page_number":154,"box":{"x":101,"y":430,"width":776,"height":11}},{"id":"8682d61d-1a5e-4063-8303-eb1a92d7bf70","block_type":"box","text":"paid by a Fund to BlackRock for various services, such as investment advisory services). These payments are not an","page_number":154,"box":{"x":70,"y":445,"width":832,"height":11}},{"id":"991ebd6c-a699-4318-b433-752ce7836406","block_type":"box","text":"additional charge to a Fund or its shareholders and do not change the price paid by shareholders for the purchase of","page_number":154,"box":{"x":69,"y":460,"width":833,"height":12}},{"id":"a5f60cfd-b3dd-4482-b536-44fbd7aea6d2","block_type":"box","text":"a Fund’s shares or the amount a Fund receives as proceeds from such purchases. Additional Payments made to","page_number":154,"box":{"x":69,"y":475,"width":802,"height":12}},{"id":"4cbf5de7-f364-4851-b25b-ad75baebd073","block_type":"box","text":"Service Organizations are in addition to any distribution or shareholder servicing fees paid under any Plan of any","page_number":154,"box":{"x":69,"y":491,"width":802,"height":11}},{"id":"973579f8-e64b-4c63-a649-d2a49ab3089d","block_type":"box","text":"Fund, any sales charges, commissions or other concessions described in the Prospectuses or this SAI, and any","page_number":154,"box":{"x":70,"y":506,"width":796,"height":11}},{"id":"feb80210-faae-447a-8c62-46da2268ac99","block_type":"box","text":"administrative, networking, recordkeeping, sub-transfer agency or sub-accounting fees payable by a Fund. 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While FINRA","page_number":154,"box":{"x":69,"y":551,"width":837,"height":11}},{"id":"98238edf-62d2-46bd-a410-523c224b9b30","block_type":"box","text":"regulations limit the sales charges that shareholders may bear, there are no limits with regard to the amounts that","page_number":154,"box":{"x":69,"y":566,"width":818,"height":11}},{"id":"a6fe881b-ecd9-4344-b5e3-68aa5c183f11","block_type":"box","text":"BlackRock may pay out of its own assets.","page_number":154,"box":{"x":70,"y":581,"width":294,"height":11}},{"id":"437658ee-0d65-471d-be4e-232a1697f85a","block_type":"box","text":"Additional Payments may be made as a fixed dollar amount, may be based on the number of Customer accounts","page_number":154,"box":{"x":101,"y":604,"width":803,"height":11}},{"id":"b6f75127-a7ff-40e9-9b51-5e0cdf0d8416","block_type":"box","text":"maintained by a Service Organization, may be based on a percentage of the value of shares sold to, or held by,","page_number":154,"box":{"x":69,"y":619,"width":792,"height":11}},{"id":"e96aefd8-9dbf-436f-8d35-0becb232750b","block_type":"box","text":"Customers of the Service Organization involved, or may be calculated on another basis.","page_number":154,"box":{"x":69,"y":634,"width":623,"height":12}},{"id":"9abb9526-9325-469c-87ce-3b715769f844","block_type":"box","text":"BlackRock negotiates Additional Payments with each Service Organization on an individual basis. Additional","page_number":154,"box":{"x":102,"y":657,"width":765,"height":11}},{"id":"9ebc6322-b34e-4058-ab5f-2780760eef5e","block_type":"box","text":"Payments may be different for different Service Organizations, and some Service Organizations may be paid pursuant","page_number":154,"box":{"x":69,"y":672,"width":841,"height":11}},{"id":"693d4e8e-3a52-4153-9adb-43221fa0c70c","block_type":"box","text":"to more than one of the calculations described above. Not all Service Organizations receive Additional Payments.","page_number":154,"box":{"x":68,"y":687,"width":806,"height":11}},{"id":"00822865-bd9a-44e9-8487-6fd2c5ed19c8","block_type":"box","text":"Sales-based payments primarily create incentives to make new sales of shares of the Fund, and asset-based","page_number":154,"box":{"x":69,"y":702,"width":776,"height":11}},{"id":"fc2a6680-b80e-4719-951b-5c85152d16d4","block_type":"box","text":"payments primarily create incentives to retain previously sold shares of the Fund. The level of payments made to","page_number":154,"box":{"x":70,"y":717,"width":802,"height":12}},{"id":"561c5cb7-d762-4edc-aa11-2d249a2e20be","block_type":"box","text":"these Service Organizations in any year will vary and may be limited to specific Funds or share classes. In cer tain","page_number":154,"box":{"x":68,"y":732,"width":811,"height":12}},{"id":"7bcc84a4-01a9-4de0-af6c-7d9bee522ab9","block_type":"box","text":"cases, these payments may be subject to cer tain minimum payment levels.","page_number":154,"box":{"x":69,"y":748,"width":538,"height":11}},{"id":"3458bcba-3eb5-42b3-a9c1-6e6bf632edd2","block_type":"box","text":"The aggregate amount of Additional Payments made by BlackRock may be substantial and may be significant to","page_number":154,"box":{"x":101,"y":770,"width":795,"height":12}},{"id":"ed17bfb7-d8ea-4c51-bfaa-0f50393bd9ed","block_type":"box","text":"cer tain Service Organizations. The categories of Additional Payments listed below are not mutually exclusive. The","page_number":154,"box":{"x":69,"y":785,"width":807,"height":12}},{"id":"6cf6e46f-4997-473f-9a26-456209374984","block_type":"box","text":"same Service Organization, or one or more of its affiliates, may receive payments under more than one category of","page_number":154,"box":{"x":69,"y":801,"width":823,"height":11}},{"id":"3e717165-ddf4-4ab9-b138-ca71d42942dd","block_type":"box","text":"Additional Payments. Such payments may be different for different Service Organizations and for different types of","page_number":154,"box":{"x":68,"y":816,"width":819,"height":11}},{"id":"6ff08a6c-b3d6-4a07-a669-c0def4adc86a","block_type":"box","text":"Funds.","page_number":154,"box":{"x":70,"y":831,"width":44,"height":9}},{"id":"091234fa-816d-49fa-b9e8-8d8128e8821e","block_type":"box","text":"A. Distribution and Marketing Suppor t","page_number":154,"box":{"x":101,"y":854,"width":270,"height":11}},{"id":"c21efbc8-503c-47f2-afdb-5f0a4e5a5f1a","block_type":"box","text":"Additional Payments may be made by BlackRock for distribution and marketing suppor t activities. 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Conflicts","page_number":158,"box":{"x":102,"y":872,"width":78,"height":9}},{"id":"61af726b-2c47-49fd-bd16-9904cbe8a5db","block_type":"box","text":"Additional Payments made by BlackRock to a Service Organization or its affiliates or other incentive","page_number":158,"box":{"x":101,"y":895,"width":710,"height":11}},{"id":"77fd3758-7276-487e-a53f-988008286234","block_type":"box","text":"arrangements may be an impor tant factor in the Service Organization’s willingness to suppor t the sale of a Fund","page_number":158,"box":{"x":69,"y":910,"width":803,"height":11}},{"id":"0be093af-53e3-4cd0-9bd1-29575d70d6d6","block_type":"box","text":"II-114","page_number":158,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"ded4ef49-b615-43b8-a0b3-529d2fdb9737","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":158,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"16427e29-9c73-45d2-aa0b-52a092657efe","block_type":"box","text":"and/or par ticular share class through its distribution system or to per form services with respect to such Fund.","page_number":159,"box":{"x":69,"y":45,"width":788,"height":11}},{"id":"4b3c150a-180f-4a4f-bc22-fdaa6b02974c","block_type":"box","text":"Additional Payments and other incentive arrangements may also be impor tant factors in the Service Organization’s","page_number":159,"box":{"x":68,"y":60,"width":819,"height":11}},{"id":"36970197-7f74-45d8-ac14-ac26eb99762b","block_type":"box","text":"willingness to recommend the BlackRock Fund complex in general.","page_number":159,"box":{"x":68,"y":75,"width":473,"height":11}},{"id":"38d796eb-9459-4902-a234-c8a76bdc0064","block_type":"box","text":"BlackRock may be motivated to pay Additional Payments and other incentive compensation to promote the sale","page_number":159,"box":{"x":102,"y":98,"width":793,"height":11}},{"id":"b937a798-eb4f-4d09-b825-f53222f9ab81","block_type":"box","text":"of Fund shares to Customers of Service Organizations and the retention of those investments by such Customers. To","page_number":159,"box":{"x":69,"y":113,"width":835,"height":11}},{"id":"bf7f4d4c-a02b-4d8f-8df1-019493c7de28","block_type":"box","text":"the extent Service Organizations sell more shares of a Fund or retain shares of a Fund in their Customers’ accounts,","page_number":159,"box":{"x":68,"y":128,"width":833,"height":11}},{"id":"7fdc23a4-f96a-4c9f-9eec-86ae0b264408","block_type":"box","text":"BlackRock benefits from the incremental management and other fees paid by the Fund with respect to those assets.","page_number":159,"box":{"x":70,"y":143,"width":830,"height":11}},{"id":"6cfec208-6746-4fa0-91b3-be9b9e45791f","block_type":"box","text":"Service Organizations may have financial incentives for recommending a par ticular Fund, share class or fund","page_number":159,"box":{"x":102,"y":166,"width":774,"height":11}},{"id":"0f78ede2-8a2b-45b6-aa5f-3faa8697d4f1","block_type":"box","text":"complex over another. Service Organizations may charge their Customers additional fees in connection with the","page_number":159,"box":{"x":69,"y":181,"width":794,"height":11}},{"id":"1e96ccd0-7b8e-433c-b9a4-dc7c63abb095","block_type":"box","text":"purchase or redemption of Fund shares or for account-related services which are in addition to the sales and other","page_number":159,"box":{"x":70,"y":196,"width":818,"height":11}},{"id":"e33c2408-0970-4896-9703-038d64d6a10e","block_type":"box","text":"charges described in the Fund’s Prospectus and this SAI. Such charges may vary among Service Organizations but in","page_number":159,"box":{"x":69,"y":211,"width":836,"height":11}},{"id":"6cc234fc-2b8c-45de-a7ed-4685b8de5161","block_type":"box","text":"all cases will be retained by the Service Organization and will not be remitted to a Fund or BlackRock.","page_number":159,"box":{"x":69,"y":226,"width":723,"height":11}},{"id":"a8416b87-dd14-4482-afcb-bde22da8ba13","block_type":"box","text":"Shareholders should consider whether such incentives exist when evaluating any recommendations from a","page_number":159,"box":{"x":102,"y":249,"width":759,"height":11}},{"id":"87e666a8-b3c6-4d27-a005-eb7abe4d7f9e","block_type":"box","text":"Service Organization to purchase or sell shares of a Fund and when considering which share class is most","page_number":159,"box":{"x":69,"y":264,"width":760,"height":11}},{"id":"a4a50763-2b0f-44b2-955e-7f5a44a2d63d","block_type":"box","text":"appropriate.","page_number":159,"box":{"x":69,"y":279,"width":84,"height":11}},{"id":"947b63aa-103b-4d08-8dfa-22c4bc922a43","block_type":"box","text":"You should consult with your Service Organization, and review carefully any disclosure by the Service","page_number":159,"box":{"x":160,"y":279,"width":738,"height":11}},{"id":"fa9978ef-ce59-47fd-96a5-319498c119c7","block_type":"box","text":"Organization, as to compensation received by it or its affiliates and for more information about the payments","page_number":159,"box":{"x":69,"y":294,"width":795,"height":11}},{"id":"c796d47a-43c9-4a9f-bc03-0b02a09d9695","block_type":"box","text":"described above.","page_number":159,"box":{"x":69,"y":309,"width":122,"height":9}},{"id":"8b41df9d-e318-45b4-b17a-2eb05e30f1d4","block_type":"box","text":"REDEMPTION OF SHARES","page_number":159,"box":{"x":385,"y":339,"width":208,"height":9}},{"id":"7541703a-2735-4483-9d30-6c6067c28d24","block_type":"box","text":"Shares normally will be redeemed for cash upon receipt of a request in proper form, although each Fund retains","page_number":159,"box":{"x":102,"y":361,"width":798,"height":12}},{"id":"40c33daf-dd97-4023-a0e4-273fee9b4c3c","block_type":"box","text":"the right to redeem some or all of its shares in-kind under unusual circumstances (valued in the same way as they","page_number":159,"box":{"x":68,"y":377,"width":817,"height":11}},{"id":"74d0cb20-2a11-4ff8-bded-19c3dac2d2d4","block_type":"box","text":"would be valued for purposes of computing a Fund’s NAV), in order to protect the interests of remaining shareholders,","page_number":159,"box":{"x":68,"y":392,"width":840,"height":11}},{"id":"686e4733-df0d-4993-aaf5-befd86f46272","block_type":"box","text":"or to accommodate a request by a par ticular shareholder that does not adversely affect the interest of the remaining","page_number":159,"box":{"x":69,"y":407,"width":834,"height":11}},{"id":"0ba7e093-785d-4a6c-b24a-6eb860bc7e45","block_type":"box","text":"shareholders, by delivery of securities and other assets selected from the Fund’s por tfolio holdings at its discretion.","page_number":159,"box":{"x":69,"y":422,"width":829,"height":11}},{"id":"eed42587-1439-4854-ab47-67766dd1bd03","block_type":"box","text":"In-kind payment means payment will be made in por tfolio securities and other assets rather than cash. If this occurs,","page_number":159,"box":{"x":70,"y":437,"width":834,"height":11}},{"id":"bfe31cea-4f4a-4738-b26e-7e24bd93416f","block_type":"box","text":"the redeeming shareholder might incur brokerage or other transaction costs to conver t the securities and other","page_number":159,"box":{"x":68,"y":452,"width":793,"height":11}},{"id":"4c08d1a1-737e-4e84-a9ad-082e2eb1e047","block_type":"box","text":"assets to cash. In an in-kind redemption, a pro rata por tion of a Fund’s por tfolio holdings will generally be distributed","page_number":159,"box":{"x":69,"y":467,"width":834,"height":12}},{"id":"a59e6714-8e2f-4982-9b56-3b16c7a3b171","block_type":"box","text":"to the redeeming shareholder, but an Index Fund may, under cer tain circumstances, deviate from pro rata redemption","page_number":159,"box":{"x":68,"y":482,"width":838,"height":12}},{"id":"af016b62-7451-4d7f-b4da-5bde468fd493","block_type":"box","text":"if the securities and other assets to be distributed are deemed to be a fair representation of por tfolio holdings and","page_number":159,"box":{"x":70,"y":498,"width":818,"height":11}},{"id":"6b1f3419-da9a-4e91-b5c3-5ea3602c0cb8","block_type":"box","text":"the interests of the remaining shareholders in the Index Fund are not diluted. Each Fund has elected, however, to be","page_number":159,"box":{"x":68,"y":513,"width":831,"height":11}},{"id":"b93df93c-e4dc-41f8-8224-5d715124b709","block_type":"box","text":"governed by Rule 18f-1 under the Investment Company Act so that the Fund is obligated to redeem its shares solely","page_number":159,"box":{"x":68,"y":528,"width":828,"height":11}},{"id":"5e7bb372-7ada-4a79-b913-d400fc504f07","block_type":"box","text":"in cash up to the lesser of $250,000 or 1% of its NAV during any 90-day period for any shareholder of the Fund. The","page_number":159,"box":{"x":70,"y":542,"width":826,"height":12}},{"id":"f02fa43a-961f-455e-b6e4-4afb2d528e37","block_type":"box","text":"redemption price is the NAV per share next determined after the initial receipt of proper notice of redemption. The","page_number":159,"box":{"x":69,"y":558,"width":810,"height":11}},{"id":"66ef58c8-a102-4190-bd6a-4faa0572d054","block_type":"box","text":"value of shares of each Fund at the time of redemption may be more or less than your cost at the time of purchase,","page_number":159,"box":{"x":68,"y":573,"width":827,"height":11}},{"id":"114890ca-bbbd-488a-8b78-14f5746c05e9","block_type":"box","text":"depending in par t on the market value of the securities held by the Fund at such time. Except for any CDSC that may","page_number":159,"box":{"x":69,"y":588,"width":832,"height":12}},{"id":"fcb5c63f-e01e-44c5-a815-e64e98543678","block_type":"box","text":"be applicable, there will be no redemption charge if your redemption request is sent directly to the Transfer Agent. If","page_number":159,"box":{"x":69,"y":603,"width":828,"height":12}},{"id":"f6408747-b57f-485c-bfaa-90d98566c598","block_type":"box","text":"you are liquidating your holdings you will receive all dividends reinvested through the date of redemption.","page_number":159,"box":{"x":68,"y":618,"width":746,"height":12}},{"id":"d92d65cb-d1de-4c3c-bd74-0f11aa507904","block_type":"box","text":"The right to redeem shares may be suspended or payment upon redemption may be delayed for more than seven","page_number":159,"box":{"x":101,"y":641,"width":807,"height":11}},{"id":"d5dc8ad4-615b-46be-b561-01a2d61cc4e9","block_type":"box","text":"days only (i) for any period during which trading on the NYSE is restricted as determined by the Commission or during","page_number":159,"box":{"x":69,"y":656,"width":835,"height":12}},{"id":"b2654716-8033-4391-a627-c790ebf6b396","block_type":"box","text":"which the NYSE is closed (other than customary weekend and holiday closings), (ii) for any period during which an","page_number":159,"box":{"x":68,"y":671,"width":811,"height":12}},{"id":"85f9548f-6f9e-490a-9e30-92c98251531a","block_type":"box","text":"emergency exists, as defined by the Commission, as a result of which disposal of por tfolio securities or","page_number":159,"box":{"x":69,"y":686,"width":741,"height":12}},{"id":"728859fb-180f-4f03-8074-c65eb46ce825","block_type":"box","text":"determination of the NAV of a Fund is not reasonably practicable, or (iii) for such other periods as the Commission","page_number":159,"box":{"x":69,"y":702,"width":813,"height":11}},{"id":"b5f359dd-0dfc-41ef-a291-5caae8e505d2","block_type":"box","text":"may by order permit for the protection of shareholders of the Fund. (A Fund may also suspend or postpone the","page_number":159,"box":{"x":69,"y":717,"width":787,"height":11}},{"id":"f951a089-1ab9-4c1e-ba46-3d5cae73081e","block_type":"box","text":"recordation of the transfer of its shares upon the occurrence of any of the foregoing conditions.)","page_number":159,"box":{"x":69,"y":732,"width":685,"height":11}},{"id":"f0935395-bf5e-44c2-8a47-65b3dac376f2","block_type":"box","text":"Each Fund, with other investment companies advised by the Manager, has entered into a joint committed line of","page_number":159,"box":{"x":102,"y":755,"width":798,"height":11}},{"id":"a52dabd6-3ca2-4aad-92c5-7bbba6acf22f","block_type":"box","text":"credit with a syndicate of banks that is intended to provide the Fund with a temporary source of cash to be used to","page_number":159,"box":{"x":69,"y":770,"width":820,"height":11}},{"id":"ab4d0569-3cdf-4e3f-a2ee-8e6d2413d14b","block_type":"box","text":"meet redemption requests from shareholders in extraordinary or emergency circumstances.","page_number":159,"box":{"x":69,"y":785,"width":653,"height":11}},{"id":"479a4ed2-743f-4ab8-a367-57ab0785b27a","block_type":"box","text":"Each Fund may redeem shares involuntarily to reimburse the Fund for any loss sustained by reason of the failure","page_number":159,"box":{"x":102,"y":807,"width":803,"height":12}},{"id":"f5b0f217-8793-48af-b441-d8d4defbd9e0","block_type":"box","text":"of a shareholder to make full payment for shares purchased by the shareholder or to collect any charge relating to a","page_number":159,"box":{"x":69,"y":823,"width":827,"height":11}},{"id":"68fb1614-bc59-4363-8e60-6450de6f94f6","block_type":"box","text":"transaction effected for the benefit of a shareholder. Each Fund reserves the express right to redeem shares of the","page_number":159,"box":{"x":68,"y":838,"width":824,"height":11}},{"id":"0bc0e645-5dfa-4483-b861-4d839ce9de72","block_type":"box","text":"Fund involuntarily at any time if the Fund’s Board of Directors determines, in its sole discretion, that failure to do so","page_number":159,"box":{"x":70,"y":853,"width":825,"height":11}},{"id":"755acfe7-343b-48c7-9e5b-6dd0789b5f0d","block_type":"box","text":"may have adverse consequences to the holders of shares in the Fund. Upon such redemption the holders of shares","page_number":159,"box":{"x":69,"y":868,"width":825,"height":11}},{"id":"3a8b58aa-aede-4f63-b961-0acaaa2be7e1","block_type":"box","text":"so redeemed shall have no fur ther right with respect thereto other than to receive payment of the redemption price.","page_number":159,"box":{"x":69,"y":883,"width":823,"height":11}},{"id":"10a7f5e8-603c-4b1a-83be-618b85530c9e","block_type":"box","text":"II-115","page_number":159,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"14566392-dc98-42cf-8f11-da79e9058409","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":159,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"6091a5fe-38e1-4f42-99e0-272260375145","block_type":"box","text":"Redemption","page_number":160,"box":{"x":69,"y":45,"width":86,"height":11}},{"id":"ce77aae3-abdb-4553-aad3-0331907407c2","block_type":"box","text":"Investor A, Investor A1, Investor C, Institutional and Class R Shares","page_number":160,"box":{"x":70,"y":67,"width":481,"height":11}},{"id":"34b11fc2-9ea4-4e78-ac73-c99006345e55","block_type":"box","text":"Redeem by Telephone:","page_number":160,"box":{"x":102,"y":90,"width":162,"height":11}},{"id":"8cdc1a18-86a8-4c04-87be-34638ff000b9","block_type":"box","text":"You may sell Investor Shares, excluding Investor P Shares, held at BlackRock by","page_number":160,"box":{"x":270,"y":90,"width":571,"height":11}},{"id":"4b5b24a4-6965-4dd4-833c-529a69a30ae2","block_type":"box","text":"telephone request if cer tain conditions are met and if the amount being sold is less than (i) $100,000 for payments","page_number":160,"box":{"x":68,"y":104,"width":829,"height":12}},{"id":"08a2cef6-9400-4130-a9bb-43df6cc36de6","block_type":"box","text":"by check or (ii) $250,000 for payments through the Automated Clearing House Network (“ACH”) or wire transfer.","page_number":160,"box":{"x":69,"y":120,"width":798,"height":12}},{"id":"22e12e06-791b-44d5-a963-fe558dc0fe09","block_type":"box","text":"Cer tain redemption requests, such as those in excess of these amounts, and those where (i) the Fund does not have","page_number":160,"box":{"x":69,"y":135,"width":838,"height":11}},{"id":"b6cd6805-9a2f-43e3-b3c5-5c009d41c1d4","block_type":"box","text":"verified banking information on file; or (ii) the proceeds are not paid to the record owner at the record address, must","page_number":160,"box":{"x":68,"y":150,"width":831,"height":12}},{"id":"51f454f2-4e5b-45e0-8f02-c8ae953f5677","block_type":"box","text":"be in writing with a medallion signature guarantee provided by any “eligible guarantor institution” as defined in Rule","page_number":160,"box":{"x":69,"y":166,"width":822,"height":11}},{"id":"baf77dd8-c5c3-49cf-9fd2-4da0ca90a27a","block_type":"box","text":"17Ad-15 under the Securities Exchange Act of 1934 (the “Exchange Act”), whose existence and validity may be","page_number":160,"box":{"x":70,"y":181,"width":791,"height":11}},{"id":"915c2066-2bdb-4068-a8e4-729700b05693","block_type":"box","text":"verified by the Transfer Agent through the use of industry publications. For Institutional Shares, cer tain redemption","page_number":160,"box":{"x":68,"y":196,"width":818,"height":11}},{"id":"f062c8e6-f3e4-400c-b433-bfefd93a9865","block_type":"box","text":"requests may require written instructions with a medallion signature guarantee. Call (800) 441-7762 for details. You","page_number":160,"box":{"x":69,"y":211,"width":829,"height":11}},{"id":"3e90bb44-2ee2-43ef-a398-ec7fbc65cbdc","block_type":"box","text":"can obtain a medallion signature guarantee stamp from a bank, securities dealer, securities broker, credit union,","page_number":160,"box":{"x":69,"y":226,"width":803,"height":11}},{"id":"ee78d68b-9dd2-412f-8cb6-6c31ab676ff4","block_type":"box","text":"savings and loan association, national securities exchange or registered securities association. The three recognized","page_number":160,"box":{"x":69,"y":241,"width":834,"height":11}},{"id":"d047b113-98e8-472e-9c63-41fba9582b94","block_type":"box","text":"medallion programs are Securities Transfer Agent Medallion Program, Stock Exchanges Medallion Program and New","page_number":160,"box":{"x":69,"y":256,"width":825,"height":12}},{"id":"cd5cb7fc-18b6-4cf9-b842-d10d8c30512a","block_type":"box","text":"York Stock Exchange, Inc. Medallion Signature Program. Signature guarantees which are not a par t of these programs","page_number":160,"box":{"x":68,"y":271,"width":840,"height":12}},{"id":"22f69c26-15d5-47ea-ae56-3c1d9416e1f1","block_type":"box","text":"will not be accepted. A notary public seal will not be acceptable. Generally, a properly signed written request with any","page_number":160,"box":{"x":68,"y":287,"width":835,"height":11}},{"id":"7fc60556-ac2c-48e7-812c-6a5bd9963297","block_type":"box","text":"required signature guarantee is all that is required for a redemption. In some cases, however, other documents may","page_number":160,"box":{"x":69,"y":302,"width":828,"height":11}},{"id":"0de54013-c261-40ee-bcb8-576b8f675939","block_type":"box","text":"be necessary. Additional documentary evidence of authority is required by the Transfer Agent in the event redemption","page_number":160,"box":{"x":69,"y":317,"width":835,"height":11}},{"id":"9f9560ef-9702-436f-b2c6-d7d5632eac66","block_type":"box","text":"is requested by a corporation, par tnership, trust, fiduciary, executor or administrator.","page_number":160,"box":{"x":70,"y":332,"width":603,"height":11}},{"id":"b57d4ed3-d6f6-440d-844c-9081d3b4ca76","block_type":"box","text":"If you make a redemption request before a Fund has collected payment for the purchase of shares, the Fund","page_number":160,"box":{"x":102,"y":355,"width":774,"height":11}},{"id":"c90c722e-26fa-48b7-bc13-50491bc4da86","block_type":"box","text":"may delay mailing your proceeds. This delay will usually not exceed ten days. A Fund, its Administrators and the","page_number":160,"box":{"x":69,"y":370,"width":795,"height":11}},{"id":"8137e0ae-40e5-477c-b4ff-d650fc290e2a","block_type":"box","text":"Distributor will employ reasonable procedures to confirm that instructions communicated by telephone are genuine.","page_number":160,"box":{"x":70,"y":385,"width":821,"height":11}},{"id":"b8888282-c09b-4b07-bd8d-c9b775f6f686","block_type":"box","text":"Telephone redemption requests will not be honored if: (i) the accountholder is deceased, (ii) the proceeds are to be","page_number":160,"box":{"x":68,"y":400,"width":823,"height":11}},{"id":"088b8284-e136-44af-8952-26ec39b40cfb","block_type":"box","text":"sent to someone other than the shareholder of record, (iii) a Fund does not have verified information on file, (iv) the","page_number":160,"box":{"x":69,"y":415,"width":823,"height":11}},{"id":"72a9f5bb-d0a1-41a6-82a0-b7c86d78ee80","block_type":"box","text":"request is by an individual other than the accountholder of record, (v) the account is held by joint tenants who are","page_number":160,"box":{"x":69,"y":430,"width":809,"height":11}},{"id":"f6a0ed45-bbe0-4f04-a63e-eedb5dd401aa","block_type":"box","text":"divorced, (vi) the address on the account has changed within the last 30 days or share cer tificates have been issued","page_number":160,"box":{"x":69,"y":445,"width":833,"height":12}},{"id":"c4eaead2-471d-4896-98c2-1a6d8ddc3453","block_type":"box","text":"on the account, or (vii) to protect against fraud, if the caller is unable to provide the account number, the name and","page_number":160,"box":{"x":69,"y":460,"width":821,"height":12}},{"id":"66926aab-5704-4287-872a-f85a885083ac","block_type":"box","text":"address registered on the account and the social security number registered on the account. The Fund and its","page_number":160,"box":{"x":69,"y":476,"width":785,"height":11}},{"id":"ec8e2b35-bdee-4db4-835a-b982a9b2a251","block_type":"box","text":"service providers will not be liable for any loss, liability, cost or expense for acting upon telephone instructions that","page_number":160,"box":{"x":69,"y":491,"width":820,"height":11}},{"id":"d03f7946-c1f0-40e7-ae7d-d971a7c120b2","block_type":"box","text":"are reasonably believed to be genuine in accordance with such procedures. Before telephone requests will be","page_number":160,"box":{"x":69,"y":506,"width":782,"height":11}},{"id":"5a47b447-6b06-4c44-95fb-033e751367cf","block_type":"box","text":"honored, signature approval from all shareholders of record on the account must be obtained. The Fund may refuse a","page_number":160,"box":{"x":69,"y":521,"width":838,"height":11}},{"id":"4223afe7-cb41-45a9-8237-f3c93a0c112a","block_type":"box","text":"telephone redemption request if it believes it is advisable to do so. During periods of substantial economic or market","page_number":160,"box":{"x":68,"y":536,"width":837,"height":11}},{"id":"36ed6877-24d0-4ef4-9ec4-e29aaf8ae31f","block_type":"box","text":"change, telephone redemptions may be difficult to complete. Please find below alternative redemption methods.","page_number":160,"box":{"x":69,"y":551,"width":800,"height":11}},{"id":"999a67ba-5fa1-41ef-ac00-fe132c31948f","block_type":"box","text":"Redemption orders for Institutional Shares placed prior to 4:00 p.m. (Eastern time) on a business day will be","page_number":160,"box":{"x":102,"y":574,"width":776,"height":11}},{"id":"6254e49e-bbb7-4ce7-aa48-2cd3ccecc0c9","block_type":"box","text":"priced at the NAV determined that day. If redemption orders are received by 4:00 p.m. (Eastern time) on a business","page_number":160,"box":{"x":70,"y":589,"width":823,"height":11}},{"id":"c01c2c99-8bd2-47ad-98d1-44bec5829dc5","block_type":"box","text":"day, payment for redeemed Institutional Shares will normally be wired in Federal Funds on the next business day. If","page_number":160,"box":{"x":69,"y":604,"width":820,"height":11}},{"id":"9e0e61aa-56a1-4fa5-bbbe-32bba25c493d","block_type":"box","text":"the Federal Reserve Bank of Philadelphia is not open on the business day following receipt of the redemption order,","page_number":160,"box":{"x":68,"y":619,"width":826,"height":11}},{"id":"da07f919-3bf1-4bb7-8a16-b311705d18fc","block_type":"box","text":"the redemption order will be accepted and processed the next succeeding business day when the Federal Reserve","page_number":160,"box":{"x":68,"y":634,"width":817,"height":12}},{"id":"e5aec1da-bf70-4221-bb46-2c90e5f435f5","block_type":"box","text":"Bank of Philadelphia is open, provided that the Fund’s custodian is also open for business.","page_number":160,"box":{"x":70,"y":649,"width":648,"height":11}},{"id":"451ea695-f606-4fe4-91ff-833591f597a8","block_type":"box","text":"Redeem by VRU:","page_number":160,"box":{"x":102,"y":672,"width":120,"height":11}},{"id":"ec173360-c930-4027-be01-dd8bc67f9418","block_type":"box","text":"Investor class shares, excluding Investor P Shares, may also be redeemed by use of a Fund’s","page_number":160,"box":{"x":229,"y":672,"width":667,"height":11}},{"id":"54975444-5fb1-4aa8-9f43-6a2409b0ed69","block_type":"box","text":"automated voice response unit service (“VRU”). Payment for Investor class shares redeemed by VRU may be made","page_number":160,"box":{"x":69,"y":687,"width":820,"height":11}},{"id":"4f6d5682-9ac7-4d3e-ac05-73297a8bc330","block_type":"box","text":"for non-retirement accounts in amounts up to $25,000, either through check, ACH or wire.","page_number":160,"box":{"x":68,"y":702,"width":644,"height":12}},{"id":"905989ce-17a9-43d1-a0b2-5d05d1ff4172","block_type":"box","text":"Redeem by Internet:","page_number":160,"box":{"x":102,"y":725,"width":147,"height":11}},{"id":"027951b0-2bfa-45d8-b9bd-d3b2f4fcf585","block_type":"box","text":"Cer tain Investor and Institutional class shares may also be redeemed by logging onto the","page_number":160,"box":{"x":255,"y":725,"width":637,"height":11}},{"id":"6fa8f772-5e65-4333-9f5b-646c5b66f41d","block_type":"box","text":"BlackRock website at www.blackrock.com. Proceeds from Internet redemptions may be sent via check, ACH or wire to","page_number":160,"box":{"x":70,"y":740,"width":836,"height":11}},{"id":"885a9d8e-1a93-4196-9abd-c291e78652b9","block_type":"box","text":"the bank account of record. Payment for shares redeemed by Internet may be made for non-retirement accounts up","page_number":160,"box":{"x":68,"y":755,"width":823,"height":11}},{"id":"d851a5c6-24eb-4f4f-9497-83c05e1d75ce","block_type":"box","text":"to $100,000 per account per day, either through check, ACH or wire. Different maximums may apply to cer tain","page_number":160,"box":{"x":68,"y":770,"width":789,"height":12}},{"id":"c65025d4-00f8-405d-a7ce-5b2ee7a8e46b","block_type":"box","text":"institutional investors.","page_number":160,"box":{"x":70,"y":786,"width":155,"height":8}},{"id":"37c47544-9d0f-4bb6-a8b2-144281759833","block_type":"box","text":"Redeem in Writing:","page_number":160,"box":{"x":102,"y":808,"width":137,"height":11}},{"id":"048e2671-865f-4c08-9e60-ae2568e33d54","block_type":"box","text":"If you hold shares with the Transfer Agent you may redeem such shares without charge by","page_number":160,"box":{"x":247,"y":808,"width":639,"height":11}},{"id":"bdbce364-52cd-4ab8-ad35-3056b23ef60f","block_type":"box","text":"writing to BlackRock, P.O. Box 534429, Pittsburgh, Pennsylvania 15253-4429. Redemption requests delivered other","page_number":160,"box":{"x":68,"y":823,"width":831,"height":12}},{"id":"89d9abc4-0f03-4cb1-a156-c7b717c9566e","block_type":"box","text":"than by mail should be sent to BlackRock, Attention: 534429, 1350 Penn Avenue Suite 102, Pittsburgh,","page_number":160,"box":{"x":68,"y":838,"width":745,"height":12}},{"id":"fe234cde-eb89-42a3-aa72-e83e794a75f6","block_type":"box","text":"Pennsylvania 15222. If you hold share cer tificates issued by your Fund, the letter must be accompanied by","page_number":160,"box":{"x":69,"y":853,"width":764,"height":12}},{"id":"0038128f-1606-433d-a40b-831d572b1060","block_type":"box","text":"cer tificates for the shares. All shareholders on the account must sign the letter. A medallion signature guarantee will","page_number":160,"box":{"x":69,"y":869,"width":831,"height":11}},{"id":"ab91d34c-a3c6-4efb-84ff-6341f23bf706","block_type":"box","text":"generally be required but may be waived in cer tain limited circumstances. You can obtain a medallion signature","page_number":160,"box":{"x":68,"y":884,"width":794,"height":11}},{"id":"9b2e378f-3878-41d1-9685-8b6c03a01ebe","block_type":"box","text":"guarantee stamp from a bank, securities dealer, securities broker, credit union, savings and loan association,","page_number":160,"box":{"x":68,"y":899,"width":782,"height":11}},{"id":"b7f8d3c0-82fa-4593-a54d-20beb70e7820","block_type":"box","text":"II-116","page_number":160,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"1c60c08f-0dd7-490a-9b22-47a5541129b1","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":160,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"6cf1b44e-b175-471d-9f6c-b5b8c7818d75","block_type":"box","text":"national securities exchange or registered securities association. A notary public seal will not be acceptable. If you","page_number":161,"box":{"x":69,"y":45,"width":817,"height":11}},{"id":"7e5c9185-b54b-465a-a5a4-51205cf7233f","block_type":"box","text":"hold stock cer tificates, return the cer tificates with the letter. Proceeds from redemptions may be sent via check, ACH","page_number":161,"box":{"x":69,"y":60,"width":836,"height":11}},{"id":"91934936-242a-4ba8-be3f-a95f34845644","block_type":"box","text":"or wire to the bank account of record.","page_number":161,"box":{"x":69,"y":75,"width":266,"height":9}},{"id":"99d95397-ca22-4c02-a707-1d7222101f95","block_type":"box","text":"Redemptions of Investor P Shares, Service Shares, Class G Shares, Class K Shares and BlackRock Shares may","page_number":161,"box":{"x":102,"y":98,"width":802,"height":11}},{"id":"4557b937-d1a4-4b7d-b709-34b32bd41c3a","block_type":"box","text":"be made in the manner and amounts described in the Prospectuses.","page_number":161,"box":{"x":69,"y":113,"width":489,"height":11}},{"id":"8e990e3b-c19d-4dd9-ba33-e1f2f8f37a41","block_type":"box","text":"The Funds or the Transfer Agent may temporarily suspend telephone transactions at any time.","page_number":161,"box":{"x":101,"y":135,"width":668,"height":12}},{"id":"d92bda20-f01c-40be-aa8c-ecbaf6d5be03","block_type":"box","text":"If you redeem shares directly with the Transfer Agent, payments will generally be mailed within one business day","page_number":161,"box":{"x":102,"y":158,"width":800,"height":11}},{"id":"0cf28108-5115-44a7-b2f7-75e1fc6349c6","block_type":"box","text":"of receipt of the proper notice of redemption. A Fund may delay the mailing of a redemption check until good payment","page_number":161,"box":{"x":69,"y":173,"width":838,"height":11}},{"id":"4585b24f-6dd7-4856-af42-c3e7dbceecc9","block_type":"box","text":"(that is, cash, Federal funds or cer tified check drawn on a U.S. bank) has been collected for the purchase of Fund","page_number":161,"box":{"x":69,"y":188,"width":811,"height":11}},{"id":"55b30b51-61b7-4fbc-9691-06b899ea7efc","block_type":"box","text":"shares, which delay will usually not exceed 10 days. If your account is held directly with the Transfer Agent and","page_number":161,"box":{"x":69,"y":203,"width":789,"height":12}},{"id":"781a98af-6c45-48c9-b5c2-8b38eb5c1105","block_type":"box","text":"contains a fractional share balance following a redemption, the fractional share balance will be automatically","page_number":161,"box":{"x":69,"y":218,"width":775,"height":12}},{"id":"693cbd47-7213-47d0-ab42-982b51975e2e","block_type":"box","text":"redeemed by the Fund.","page_number":161,"box":{"x":69,"y":234,"width":162,"height":11}},{"id":"cf39460d-145a-49ee-9628-c762eccf95c0","block_type":"box","text":"Note on Low Balance Accounts.","page_number":161,"box":{"x":102,"y":257,"width":223,"height":8}},{"id":"fc83ad68-f3e0-45cf-9fc1-23aa3e3edd88","block_type":"box","text":"Because of the high cost of maintaining smaller shareholder accounts,","page_number":161,"box":{"x":332,"y":256,"width":503,"height":12}},{"id":"f37b0f10-fc38-4620-8cca-99e4e93fabe3","block_type":"box","text":"BlackRock has set a minimum balance of $500 in each Fund position you hold within your account (“Fund","page_number":161,"box":{"x":70,"y":271,"width":752,"height":12}},{"id":"47b3397c-5579-4a77-b0b2-de68f7f89902","block_type":"box","text":"Minimum”), and may redeem the shares in your account if the NAV of those shares in your account falls below $500","page_number":161,"box":{"x":70,"y":286,"width":829,"height":12}},{"id":"2f6a1ac8-2b6e-471d-a2ee-5e292ee1dd5b","block_type":"box","text":"for any reason, including market fluctuation.","page_number":161,"box":{"x":68,"y":302,"width":313,"height":11}},{"id":"387dbfad-a8bb-4f32-9d3a-e30ad431495e","block_type":"box","text":"You will be notified that the value of your account is less than the Fund Minimum before the Fund makes any","page_number":161,"box":{"x":101,"y":324,"width":775,"height":11}},{"id":"874d9212-06e9-4856-9795-9cdca912b542","block_type":"box","text":"involuntary redemption. This notification will provide you with a 90 calendar day period to make an additional","page_number":161,"box":{"x":70,"y":339,"width":773,"height":12}},{"id":"f47a0c0c-8bcb-49e1-8a34-442dfee7669d","block_type":"box","text":"investment in order to bring the value of your account to at least $500 before the Fund makes an involuntary","page_number":161,"box":{"x":70,"y":354,"width":776,"height":12}},{"id":"5d83c757-4636-4bae-8654-8454a52328a3","block_type":"box","text":"redemption. This involuntary redemption will not charge any deferred sales charge, and may not apply to accounts of","page_number":161,"box":{"x":69,"y":370,"width":834,"height":11}},{"id":"35577238-7c9d-447e-8b1b-274f715e9d88","block_type":"box","text":"cer tain employer-sponsored retirement plans (not including IRAs), qualified state tuition plan (529 Plan) accounts,","page_number":161,"box":{"x":69,"y":385,"width":811,"height":11}},{"id":"219e1e22-cc6c-4585-b0df-804f85d7a081","block_type":"box","text":"and select fee-based programs at your financial intermediary.","page_number":161,"box":{"x":69,"y":400,"width":435,"height":11}},{"id":"1b9d8773-4876-48f6-a376-b593946196e8","block_type":"box","text":"Repurchase","page_number":161,"box":{"x":69,"y":430,"width":85,"height":11}},{"id":"50234274-7e67-47b5-b2f5-c114d4d8ceec","block_type":"box","text":"A Fund normally will accept orders to repurchase shares from Selling Dealers for their customers. Shares will be","page_number":161,"box":{"x":101,"y":453,"width":800,"height":11}},{"id":"774319dd-bb99-42f6-9092-fee539240872","block_type":"box","text":"priced at the NAV of the Fund next determined after receipt of the repurchase order by a Selling Dealer that has been","page_number":161,"box":{"x":70,"y":468,"width":833,"height":11}},{"id":"2c7805f2-c01d-4269-a537-fadbc4f30ffe","block_type":"box","text":"authorized by the Distributor by contract to accept such orders. As to repurchase orders received by Selling Dealers","page_number":161,"box":{"x":69,"y":483,"width":822,"height":11}},{"id":"c0712f75-2388-4155-bbe4-7b0539c98909","block_type":"box","text":"prior to the close of business on the NYSE (generally, the NYSE closes at 4:00 p.m. Eastern time), on the day the","page_number":161,"box":{"x":70,"y":498,"width":809,"height":11}},{"id":"dc22250b-f98a-4886-a4e5-1e7cfaf9a71d","block_type":"box","text":"order is placed, which includes orders received after the close of business on the previous day, the repurchase price","page_number":161,"box":{"x":69,"y":513,"width":831,"height":11}},{"id":"2ad6e5eb-5906-4a65-9a46-79fee13393ae","block_type":"box","text":"is the NAV determined as of the close of business on the NYSE on that day. If the orders for repurchase are not","page_number":161,"box":{"x":70,"y":528,"width":796,"height":12}},{"id":"c23b4f29-1eba-4936-9559-af832ae05a32","block_type":"box","text":"received by the Selling Dealer before the close of business on the NYSE, such orders are deemed received on the","page_number":161,"box":{"x":69,"y":543,"width":812,"height":12}},{"id":"eebd63dd-cace-44d5-ab27-b2e93dec8ac4","block_type":"box","text":"next business day.","page_number":161,"box":{"x":69,"y":559,"width":130,"height":11}},{"id":"0fe6cc3e-ff49-40b4-a78e-590f24ebf868","block_type":"box","text":"These repurchase arrangements are for your convenience and do not involve a charge by the Fund (other than","page_number":161,"box":{"x":101,"y":581,"width":783,"height":12}},{"id":"b00ab8d2-819d-4ebb-a1dc-5a2c8e3c2736","block_type":"box","text":"any applicable CDSC or redemption fee). However, Selling Dealers may charge a processing fee in connection with","page_number":161,"box":{"x":69,"y":596,"width":813,"height":12}},{"id":"88c4ee71-86c9-4d71-8bc2-e5926461a13c","block_type":"box","text":"such transactions. In addition, securities firms that do not have selected dealer agreements with the Distributor may","page_number":161,"box":{"x":69,"y":612,"width":832,"height":11}},{"id":"cb9a9735-84f8-43e1-a971-73090403f8b3","block_type":"box","text":"impose a transaction charge for transmitting the notice of repurchase to the Fund. Each Fund reserves the right to","page_number":161,"box":{"x":70,"y":627,"width":814,"height":11}},{"id":"b541a732-0ea2-4a09-8220-80f7603630f5","block_type":"box","text":"reject any order for repurchase. A shareholder whose order for repurchase is rejected by a Fund, however, may","page_number":161,"box":{"x":69,"y":642,"width":788,"height":11}},{"id":"647accda-c7f3-45fd-8ded-13d817a4b2da","block_type":"box","text":"redeem shares as set out above.","page_number":161,"box":{"x":69,"y":657,"width":235,"height":9}},{"id":"e4543c80-0537-44b1-a416-3f4d0956678c","block_type":"box","text":"Reinstatement Privilege — Investor A and Investor P Shares","page_number":161,"box":{"x":69,"y":687,"width":440,"height":11}},{"id":"4ce9144c-6b7f-4d51-94a6-96f8d35e8a94","block_type":"box","text":"Upon redemption of Investor A, Investor A1, Investor P or Institutional Shares, as applicable, shareholders may","page_number":161,"box":{"x":102,"y":710,"width":791,"height":11}},{"id":"10c1423a-d128-41b7-8c6c-974f1623e1be","block_type":"box","text":"reinvest all or a por tion of their redemption proceeds (after paying any applicable CDSC) in Investor A or Investor P","page_number":161,"box":{"x":69,"y":725,"width":815,"height":11}},{"id":"582922ce-936c-4776-9adb-285914f40cdf","block_type":"box","text":"Shares of the same or another BlackRock fund without paying a front-end sales charge. This right may be exercised","page_number":161,"box":{"x":69,"y":740,"width":822,"height":11}},{"id":"c1e528bf-92e0-4c48-99f5-2b18ae4d9782","block_type":"box","text":"within 90 days of the redemption, provided that the Investor A or Investor P Shares, as applicable, of that fund is","page_number":161,"box":{"x":68,"y":755,"width":806,"height":11}},{"id":"746e3575-c058-409d-8703-03b99223dc8f","block_type":"box","text":"currently open to new investors or the shareholder has a current account in that closed fund. Shares will be","page_number":161,"box":{"x":69,"y":770,"width":768,"height":11}},{"id":"e778291b-86e5-4baa-b79e-388a4b1bff19","block_type":"box","text":"purchased at the NAV calculated at the close of trading on the day the request is received in good order. To exercise","page_number":161,"box":{"x":70,"y":785,"width":827,"height":12}},{"id":"f2e5a47f-0058-43a2-8e80-1982c1982eef","block_type":"box","text":"this privilege, the Transfer Agent must receive written notification from the shareholder of record or the registered","page_number":161,"box":{"x":68,"y":801,"width":809,"height":11}},{"id":"3f4de218-ae31-4ef4-9e33-e666b443243f","block_type":"box","text":"representative of record, at the time of purchase. Investors should consult a tax advisor concerning the tax","page_number":161,"box":{"x":69,"y":816,"width":764,"height":11}},{"id":"900ea6fe-6388-4eec-9b49-bed0160378ba","block_type":"box","text":"consequences of exercising this reinstatement privilege.","page_number":161,"box":{"x":69,"y":831,"width":400,"height":11}},{"id":"d09530ac-3897-416d-af74-b9466b2c653e","block_type":"box","text":"II-117","page_number":161,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"944d0626-2878-4dae-884e-6710be2bbfb7","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":161,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"d85df04c-6de6-4af1-8aed-d0a24548d517","block_type":"box","text":"SHAREHOLDER SERVICES","page_number":162,"box":{"x":384,"y":45,"width":210,"height":10}},{"id":"f0e82325-b057-44e8-bf3c-d5c0ef38e68b","block_type":"box","text":"Each Fund offers one or more of the shareholder services described below that are designed to facilitate","page_number":162,"box":{"x":102,"y":68,"width":747,"height":11}},{"id":"51f4ac4e-bddd-45d9-b583-dc29b437a503","block_type":"box","text":"investment in its shares. You can obtain more information about these services from each Fund by calling the","page_number":162,"box":{"x":70,"y":83,"width":781,"height":11}},{"id":"604811fa-6738-4ca3-9efe-c3bf6a672f8e","block_type":"box","text":"telephone number on the cover page, or from the Distributor, your financial adviser, your selected securities dealer or","page_number":162,"box":{"x":68,"y":98,"width":836,"height":11}},{"id":"d6025bfb-7db7-4536-b9cd-a56352ea5ce0","block_type":"box","text":"other financial intermediary. Cer tain of these services are available only to U.S. investors.","page_number":162,"box":{"x":69,"y":113,"width":641,"height":11}},{"id":"65052d02-e4b5-4cd9-b619-b8003da62e3f","block_type":"box","text":"Investment Account","page_number":162,"box":{"x":69,"y":144,"width":146,"height":9}},{"id":"62235cde-9ed0-4463-817d-f66a0a905ed2","block_type":"box","text":"If your account is maintained at the Transfer Agent (an “Investment Account”) you will receive statements, at","page_number":162,"box":{"x":102,"y":166,"width":774,"height":11}},{"id":"a24b4319-8533-4418-b29d-85b2a1f9226f","block_type":"box","text":"least quar terly, from the Transfer Agent. These statements will serve as confirmations for automatic investment","page_number":162,"box":{"x":70,"y":181,"width":796,"height":12}},{"id":"6300aab0-0ff2-47ad-81de-11ed7ed1c8c2","block_type":"box","text":"purchases and the reinvestment of dividends. The statements also will show any other activity in your Investment","page_number":162,"box":{"x":70,"y":196,"width":807,"height":12}},{"id":"2890daad-94e4-4df5-bee2-dcfb8f400dbc","block_type":"box","text":"Account since the last statement. You also will receive separate confirmations for each purchase or sale transaction","page_number":162,"box":{"x":68,"y":212,"width":830,"height":11}},{"id":"ac3e7b06-49e8-409a-ac70-81bd924eb325","block_type":"box","text":"other than automatic investment purchases and the reinvestment of dividends. If your Investment Account is held at","page_number":162,"box":{"x":69,"y":227,"width":829,"height":11}},{"id":"96b4ec8b-66fc-45b0-a1c3-1ed14a2f44b5","block_type":"box","text":"the Transfer Agent you may make additions to it at any time by mailing a check directly to the Transfer Agent. Each","page_number":162,"box":{"x":68,"y":242,"width":815,"height":11}},{"id":"cd1856e3-3062-4d4c-964b-bb0bd01b5eb9","block_type":"box","text":"Fund limits purchases by personal check to $500,000 per trade. You may also maintain an account through a","page_number":162,"box":{"x":70,"y":256,"width":781,"height":12}},{"id":"3fcb90b1-5533-4161-b2f9-796a2aa6bf81","block_type":"box","text":"selected securities dealer or other financial intermediary. If you transfer shares out of an account maintained with a","page_number":162,"box":{"x":69,"y":272,"width":825,"height":11}},{"id":"976bd7db-f898-430b-b067-40e1516c2469","block_type":"box","text":"selected securities dealer or other financial intermediary, an Investment Account in your name may be opened","page_number":162,"box":{"x":69,"y":287,"width":785,"height":11}},{"id":"5efa4b7e-498b-4261-b3b9-1ab316c173c3","block_type":"box","text":"automatically at the Transfer Agent.","page_number":162,"box":{"x":69,"y":302,"width":251,"height":12}},{"id":"04322021-20c3-4fcb-b16e-fafbce0e488b","block_type":"box","text":"You may transfer Fund shares from a selected securities dealer or other financial intermediary to another","page_number":162,"box":{"x":101,"y":325,"width":750,"height":11}},{"id":"6a9ec441-e24c-4bbb-bdd4-06553817d1dc","block_type":"box","text":"securities dealer or other financial intermediary that has entered into an agreement with the Distributor. Cer tain","page_number":162,"box":{"x":69,"y":340,"width":797,"height":11}},{"id":"7cad7bee-63ce-45f0-8faf-5f61506b6abb","block_type":"box","text":"shareholder services may not be available for the transferred shares. All future trading of these assets must be","page_number":162,"box":{"x":69,"y":355,"width":797,"height":11}},{"id":"2a4554e2-933b-4fb0-a76d-9bd5590ba265","block_type":"box","text":"coordinated by the new firm. If you wish to transfer your shares to a securities dealer or other financial intermediary","page_number":162,"box":{"x":69,"y":370,"width":826,"height":11}},{"id":"5e55e5e7-822d-4b68-9d8b-80baaa9a4f45","block_type":"box","text":"that has not entered into an agreement with the Distributor, you must either (i) redeem your shares, paying any","page_number":162,"box":{"x":68,"y":386,"width":792,"height":11}},{"id":"4cadc9c6-563f-4a66-a675-58bbb729059c","block_type":"box","text":"applicable CDSC or (ii) continue to maintain an Investment Account at the Transfer Agent for those shares. You also","page_number":162,"box":{"x":69,"y":401,"width":824,"height":11}},{"id":"40e90baf-e6cb-4f9f-954f-d346d8c9b7cf","block_type":"box","text":"may request that the new securities dealer or other financial intermediary maintain the shares in an account at the","page_number":162,"box":{"x":69,"y":416,"width":820,"height":11}},{"id":"1bcdcea2-f41d-4ad0-b75e-95f93e156af4","block_type":"box","text":"Transfer Agent registered in the name of the securities dealer or other financial intermediary for your benefit whether","page_number":162,"box":{"x":68,"y":431,"width":833,"height":11}},{"id":"070d7a5f-08dd-4c9a-9928-95be919efe3f","block_type":"box","text":"the securities dealer or other financial intermediary has entered into a selected dealer agreement or not. In the","page_number":162,"box":{"x":68,"y":446,"width":795,"height":11}},{"id":"ca1b7607-bff5-4fcc-9d8e-1d6ce9fc15db","block_type":"box","text":"interest of economy and convenience and because of the operating procedures of each Fund, share cer tificates will","page_number":162,"box":{"x":70,"y":461,"width":822,"height":11}},{"id":"00993c9b-6675-4c48-ae08-ec2e53c05e95","block_type":"box","text":"not be issued physically. Shares are maintained by each Fund on its register maintained by the Transfer Agent and","page_number":162,"box":{"x":69,"y":476,"width":814,"height":11}},{"id":"b31c1b71-765c-4be4-ae14-3a773bccdcbb","block_type":"box","text":"the holders thereof will have the same rights and ownership with respect to such shares as if cer tificates had been","page_number":162,"box":{"x":68,"y":491,"width":822,"height":12}},{"id":"6f4f0105-9428-4252-83fa-e42242cdbc53","block_type":"box","text":"issued.","page_number":162,"box":{"x":70,"y":507,"width":49,"height":8}},{"id":"1a205756-4e6f-45a9-b6db-1b1c63811ad5","block_type":"box","text":"If you are considering transferring a tax-deferred retirement account, such as an individual retirement account,","page_number":162,"box":{"x":102,"y":529,"width":785,"height":11}},{"id":"89342953-0d8a-4ea0-83b0-7dc6832ba903","block_type":"box","text":"from one selected securities dealer to another securities dealer or other financial intermediary, you should be aware","page_number":162,"box":{"x":68,"y":544,"width":830,"height":11}},{"id":"9d072b4f-6f95-4a7d-a840-0f06b7e98cb2","block_type":"box","text":"that if the new firm will not take delivery of shares of the Fund, you must either redeem the shares (paying any","page_number":162,"box":{"x":68,"y":559,"width":790,"height":12}},{"id":"2bc469a3-083d-4f26-b852-e69e1fc3ea7e","block_type":"box","text":"applicable CDSC) so that the cash proceeds can be transferred to the account at the new firm, or you must continue","page_number":162,"box":{"x":69,"y":574,"width":831,"height":12}},{"id":"a21a230c-cd5b-45e4-96fe-23d6ee7363ce","block_type":"box","text":"to maintain a retirement account at the original selected securities dealer for those shares.","page_number":162,"box":{"x":68,"y":589,"width":652,"height":12}},{"id":"8ff7c6b9-9966-44fe-bac4-3e7f1447c4d8","block_type":"box","text":"Exchange Privilege","page_number":162,"box":{"x":69,"y":620,"width":138,"height":11}},{"id":"4ecd8b2a-f3be-4093-953d-e968de1b4de9","block_type":"box","text":"U.S. shareholders of Investor A, Investor A1, Investor C, Investor P, Class K, Institutional and Class G Shares of","page_number":162,"box":{"x":102,"y":642,"width":797,"height":11}},{"id":"51c1079d-433b-4591-9a48-7c6c4ed9accf","block_type":"box","text":"each Fund have an exchange privilege with cer tain other Funds. However, Investor A1 Shares may only exchange out.","page_number":162,"box":{"x":69,"y":658,"width":832,"height":11}},{"id":"960e9281-5159-457c-8f63-4b81770af835","block_type":"box","text":"The minimum amount for exchanges of Investor class shares is $1,000, although you may exchange less than","page_number":162,"box":{"x":68,"y":672,"width":788,"height":12}},{"id":"d86459fc-e5dd-4091-a360-f5286222cc0f","block_type":"box","text":"$1,000 if you already have an account in the Fund into which you are exchanging. You may only exchange into a","page_number":162,"box":{"x":69,"y":687,"width":796,"height":12}},{"id":"194eb004-6e6f-4fde-8052-4d92a50803b0","block_type":"box","text":"share class and a Fund that are open to new investors or in which you have a current account if the class or fund is","page_number":162,"box":{"x":69,"y":703,"width":824,"height":11}},{"id":"c7c26579-969c-421c-a687-dd1282637bfa","block_type":"box","text":"closed to new investors. Before effecting an exchange, you should obtain a currently effective prospectus of the fund","page_number":162,"box":{"x":69,"y":718,"width":835,"height":11}},{"id":"4a4592d9-9d35-4320-b42b-58fc42149dc0","block_type":"box","text":"into which you wish to make the exchange. Exercise of the exchange privilege is treated as a sale of the exchanged","page_number":162,"box":{"x":70,"y":733,"width":820,"height":11}},{"id":"b34b3cb4-c259-44d9-8a76-c641d1933408","block_type":"box","text":"shares and a purchase of the acquired shares for U.S. federal income tax purposes.","page_number":162,"box":{"x":69,"y":748,"width":600,"height":11}},{"id":"e8b53ec7-c9d9-40e6-97cc-8e2e8e483307","block_type":"box","text":"Exchanges of Investor A, Investor A1, Investor P, Class K, Institutional and Class G Shares.","page_number":162,"box":{"x":102,"y":771,"width":648,"height":11}},{"id":"b76b77a9-0aa1-4e3a-aa4d-220723cd1de2","block_type":"box","text":"Institutional Shares","page_number":162,"box":{"x":757,"y":771,"width":137,"height":9}},{"id":"5917c4b7-533d-4c3d-a3b0-575f00a8749b","block_type":"box","text":"are exchangeable with Institutional Shares of other Funds. Investor A and Investor A1 Shares are exchangeable for","page_number":162,"box":{"x":69,"y":786,"width":817,"height":11}},{"id":"3af77618-664e-4be4-95bf-dce461cc69ea","block_type":"box","text":"Investor A Shares of other Funds to the extent such shares are offered by your financial intermediary. Investor P","page_number":162,"box":{"x":70,"y":801,"width":798,"height":11}},{"id":"5bb0eef5-d950-43b5-a5a9-561be0e2eed8","block_type":"box","text":"Shares are exchangeable for Investor P Shares of other Funds, to the extent such shares are offered by your financial","page_number":162,"box":{"x":69,"y":816,"width":838,"height":12}},{"id":"c5bfe97e-e23e-42fc-98bb-b379c73d3a91","block_type":"box","text":"intermediary. Class K Shares are exchangeable for Class K Shares of other Funds. Class G Shares are exchangeable","page_number":162,"box":{"x":70,"y":831,"width":834,"height":12}},{"id":"84640587-91fd-4322-820e-78b253e1842c","block_type":"box","text":"for Class G Shares of other Funds.","page_number":162,"box":{"x":68,"y":846,"width":246,"height":10}},{"id":"3473f759-00de-4b41-870a-175f143483a0","block_type":"box","text":"Exchanges of Institutional Shares outstanding for Institutional Shares of a second fund or for shares of a money","page_number":162,"box":{"x":102,"y":869,"width":800,"height":11}},{"id":"758fef86-f458-4d6b-8b7f-c51f3c84e6fa","block_type":"box","text":"market fund are effected on the basis of relative NAV per Institutional Share. Exchanges of Investor A or Investor A1","page_number":162,"box":{"x":69,"y":884,"width":826,"height":12}},{"id":"6e0dc41e-321e-4bc6-83cf-be0a95115275","block_type":"box","text":"Shares outstanding (“outstanding Investor A Shares”) for Investor A Shares of a second fund, or for shares of a","page_number":162,"box":{"x":69,"y":899,"width":795,"height":12}},{"id":"2039f837-892f-42bf-9f48-4c2d4f078140","block_type":"box","text":"II-118","page_number":162,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"c7b12d0f-092e-42cc-80fd-05644598665d","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":162,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"373c8808-f30a-44a4-b125-5c16246d71c7","block_type":"box","text":"money market fund (“new Investor A Shares”) are effected on the basis of relative NAV per share. Exchanges of","page_number":163,"box":{"x":69,"y":45,"width":797,"height":11}},{"id":"b6b266bf-ffc5-4511-8f50-0a516df0901f","block_type":"box","text":"Investor P Shares outstanding for Investor P Shares of a second fund are effected on the basis of relative NAV per","page_number":163,"box":{"x":70,"y":60,"width":814,"height":11}},{"id":"f51071e7-6dc6-494d-ac3c-dda65aa9440a","block_type":"box","text":"share. Exchanges of Class K Shares outstanding for Class K Shares of a second fund, or for shares of a money","page_number":163,"box":{"x":69,"y":75,"width":796,"height":11}},{"id":"d548c657-2636-4a0e-a891-c3afdc7f10b7","block_type":"box","text":"market fund are effected on the basis of relative NAV per share. Exchanges of Class G Shares outstanding for Class","page_number":163,"box":{"x":69,"y":90,"width":828,"height":11}},{"id":"9c7e3fcd-24e1-47a5-95ec-e2533174aef8","block_type":"box","text":"G Shares of a second fund are effected on the basis of relative NAV per share.","page_number":163,"box":{"x":69,"y":105,"width":561,"height":11}},{"id":"79c9fc45-92c3-42bb-a893-7d944b14796b","block_type":"box","text":"Exchanges of Investor C Shares.","page_number":163,"box":{"x":102,"y":128,"width":229,"height":11}},{"id":"caaeb78f-25e0-44cc-a345-ac7d9dc6f5f2","block_type":"box","text":"Shareholders of cer tain Funds with Investor C Shares outstanding (“outstanding","page_number":163,"box":{"x":338,"y":128,"width":570,"height":11}},{"id":"ffed0482-8866-47c2-8745-6256b4ed4698","block_type":"box","text":"Investor C Shares”) may exchange their shares for Investor C Shares of a second Fund (“new Investor C Shares”) or","page_number":163,"box":{"x":70,"y":143,"width":827,"height":11}},{"id":"019484a1-502a-401b-966c-2a8ba7f642c6","block_type":"box","text":"for shares of a money market fund (“new money market fund Shares”) on the basis of relative NAV per share, without","page_number":163,"box":{"x":68,"y":158,"width":839,"height":11}},{"id":"3261bc69-30e5-45f1-8bd1-7f4d94201a18","block_type":"box","text":"the payment of any CDSC. Cer tain Funds impose different CDSC schedules. For purposes of computing the CDSC","page_number":163,"box":{"x":68,"y":173,"width":811,"height":11}},{"id":"a3b9d984-b112-45b8-8488-b06134163168","block_type":"box","text":"upon redemption of new Investor C Shares or new money market fund Shares, as applicable, the time you held both","page_number":163,"box":{"x":69,"y":188,"width":827,"height":11}},{"id":"55a1e273-d1f4-49e2-89a5-3e6022ca07e9","block_type":"box","text":"the exchanged Investor C Shares and the new Investor C Shares or new money market fund Shares will count","page_number":163,"box":{"x":68,"y":203,"width":781,"height":12}},{"id":"5c5f339d-5913-420c-980c-d741ea39832a","block_type":"box","text":"towards the holding period of the new Investor C Shares or new money market fund Shares.","page_number":163,"box":{"x":68,"y":218,"width":654,"height":12}},{"id":"e6f0a663-51b0-4237-b450-9b0840d199f7","block_type":"box","text":"Exchanges of Service Shares.","page_number":163,"box":{"x":102,"y":241,"width":211,"height":11}},{"id":"dd2eb98f-7c2b-4331-84be-22738bff86d9","block_type":"box","text":"Service Shares can be exchanged for Service Shares of Funds that are covered by","page_number":163,"box":{"x":319,"y":241,"width":588,"height":11}},{"id":"e5751906-cbd8-41e7-a4db-039538ac907d","block_type":"box","text":"selected dealer agreements with the Distributor.","page_number":163,"box":{"x":69,"y":257,"width":342,"height":11}},{"id":"08c4e8cd-ea1f-4fec-8275-cbc6832be4fd","block_type":"box","text":"Exchanges for Shares of a Money Market Fund.","page_number":163,"box":{"x":102,"y":279,"width":335,"height":11}},{"id":"9dfe7614-ad74-4080-9513-9c70307ff192","block_type":"box","text":"You may exchange any class of Investor class shares, excluding","page_number":163,"box":{"x":443,"y":279,"width":455,"height":11}},{"id":"a0fa3b28-6fe8-4fdf-bb47-dd862a82ecce","block_type":"box","text":"Investor P Shares, for shares of an affiliated money market fund. If you exchange into BlackRock Summit Cash","page_number":163,"box":{"x":70,"y":294,"width":788,"height":11}},{"id":"44073250-b165-408e-9171-842791aa2e12","block_type":"box","text":"Reserves Fund (“Summit”), a series of BlackRock Financial Institutions Series Trust, you will receive one of two","page_number":163,"box":{"x":70,"y":309,"width":793,"height":11}},{"id":"0e8de44a-ecbb-4e5c-8165-7115f2cd6097","block_type":"box","text":"classes of shares: exchanges of Investor A, Investor A1 and Institutional Shares of a Fund will receive Investor A","page_number":163,"box":{"x":69,"y":324,"width":802,"height":12}},{"id":"c1306b88-9e45-46b3-88f3-ecbf1827dee3","block_type":"box","text":"Shares of Summit and exchanges of Investor C Shares of a Fund will receive Investor C Shares of Summit. You may","page_number":163,"box":{"x":69,"y":339,"width":824,"height":12}},{"id":"c35e24e7-6d76-4844-874a-5828c6f172c4","block_type":"box","text":"exchange Investor A Shares of Summit back into Investor A or Institutional Shares of a Fund, if you are eligible to","page_number":163,"box":{"x":69,"y":355,"width":805,"height":11}},{"id":"0a28ec09-5f7a-46e4-a4d4-da7b33928932","block_type":"box","text":"hold such shares. You may exchange Investor C Shares of Summit back into Investor C Shares of a Fund and, in the","page_number":163,"box":{"x":69,"y":370,"width":827,"height":11}},{"id":"989cfdf9-9313-4a99-bfc9-5243aaee9dc3","block_type":"box","text":"event of such an exchange, the period of time that you held Investor C Shares of Summit will count toward","page_number":163,"box":{"x":69,"y":385,"width":758,"height":11}},{"id":"89a4b456-b7c2-4531-9efc-56432fa461ba","block_type":"box","text":"satisfaction of the holding period requirement for purposes of reducing any CDSC. Investor C Shares of Summit are","page_number":163,"box":{"x":69,"y":400,"width":822,"height":11}},{"id":"6e4835b0-507b-49e5-a731-58a18a3ccb40","block_type":"box","text":"subject to a distribution fee at an annual rate of 0.75% of average daily net assets of such Investor C Shares.","page_number":163,"box":{"x":69,"y":415,"width":782,"height":11}},{"id":"9ed01142-7ed9-4641-ad68-4518fd6e91b2","block_type":"box","text":"Exchanges of Investor C Shares of a money market fund other than Summit for Investor C Shares of a Fund will be","page_number":163,"box":{"x":70,"y":430,"width":814,"height":11}},{"id":"63329cc9-6252-4dae-aaaa-b48bacc7411c","block_type":"box","text":"exercised at NAV. However, a CDSC may be charged in connection with any subsequent redemption of the Investor C","page_number":163,"box":{"x":69,"y":445,"width":830,"height":12}},{"id":"7fb81f17-0878-4c9f-a172-2120b2d066de","block_type":"box","text":"Shares of the Fund received in the exchange. In determining the holding period for calculating the CDSC payable on","page_number":163,"box":{"x":69,"y":460,"width":821,"height":12}},{"id":"62da9673-4330-4f3f-bb44-0be5fb887bd6","block_type":"box","text":"redemption of Investor C Shares of the Fund received in the exchange, the holding period of the money market fund","page_number":163,"box":{"x":69,"y":475,"width":823,"height":12}},{"id":"1aaa4eb6-a0c5-4e34-be0c-b739c9c6be82","block_type":"box","text":"Investor C Shares originally held will be added to the holding period of the Investor C Shares acquired through","page_number":163,"box":{"x":70,"y":491,"width":781,"height":11}},{"id":"0b9b8c2b-ff45-4af6-be9a-479c8fb47189","block_type":"box","text":"exchange.","page_number":163,"box":{"x":69,"y":506,"width":70,"height":11}},{"id":"5b7fc1ea-a2a7-4d14-9579-7d05cd222a72","block_type":"box","text":"Exchanges by Par ticipants in Cer tain Programs.","page_number":163,"box":{"x":102,"y":529,"width":337,"height":11}},{"id":"e599290c-5f53-4a04-bdc5-f8c0ff768b2b","block_type":"box","text":"The exchange privilege may be modified with respect to cer tain","page_number":163,"box":{"x":445,"y":528,"width":448,"height":12}},{"id":"c6ccf0ed-420b-4cae-b42d-38ca812a0235","block_type":"box","text":"par ticipants in mutual fund advisory programs and other fee-based programs sponsored by the Manager, an affiliate","page_number":163,"box":{"x":70,"y":543,"width":828,"height":12}},{"id":"616d6b4d-930b-4ba7-9ea2-b6777fd06d8a","block_type":"box","text":"of the Manager, or selected securities dealers or other financial intermediaries that have an agreement with the","page_number":163,"box":{"x":69,"y":559,"width":796,"height":11}},{"id":"7ae88ee1-f24a-4cad-ab94-708466fcf3e4","block_type":"box","text":"Distributor. See “Fee-Based Programs” below.","page_number":163,"box":{"x":70,"y":574,"width":324,"height":11}},{"id":"c1c17327-7dbc-4ac7-bc10-8561f6f57b46","block_type":"box","text":"Exercise of the Exchange Privilege.","page_number":163,"box":{"x":102,"y":596,"width":245,"height":12}},{"id":"73e381c0-7db3-4b74-a6a4-e8c0d381eecd","block_type":"box","text":"To exercise the exchange privilege, you should contact your financial adviser","page_number":163,"box":{"x":353,"y":596,"width":543,"height":12}},{"id":"e59039ba-27b5-450d-8389-0fcda7a6c255","block_type":"box","text":"or the Transfer Agent, who will advise each Fund of the exchange. If you do not hold share cer tificates, you may","page_number":163,"box":{"x":69,"y":612,"width":794,"height":11}},{"id":"9741cd8e-3176-44a3-a7db-531d431eb9e8","block_type":"box","text":"exercise the exchange privilege by wire through your securities dealer or other financial intermediary. Each Fund","page_number":163,"box":{"x":69,"y":627,"width":795,"height":11}},{"id":"82af5e84-20cd-435a-adf7-70dfcdb8eb40","block_type":"box","text":"reserves the right to require a properly completed exchange application.","page_number":163,"box":{"x":69,"y":642,"width":512,"height":11}},{"id":"df25efbe-0d88-4d1f-813e-715c26355d81","block_type":"box","text":"A shareholder who wishes to make an exchange may do so by sending a written request to the Fund c/o the","page_number":163,"box":{"x":101,"y":665,"width":772,"height":11}},{"id":"4fedcf57-5c10-47cf-997d-3b87c1d0a713","block_type":"box","text":"Transfer Agent at the following address: P.O. Box 534429, Pittsburgh, Pennsylvania 15253-4429. Shareholders are","page_number":163,"box":{"x":68,"y":680,"width":824,"height":11}},{"id":"d885bc91-c37b-476d-ae46-fa938a3e45ce","block_type":"box","text":"automatically provided with telephone exchange privileges when opening an account, unless they indicate on the","page_number":163,"box":{"x":69,"y":695,"width":801,"height":11}},{"id":"9793939f-db1b-4468-a82d-9a0f0399aa5c","block_type":"box","text":"Application that they do not wish to use this privilege. To add this feature to an existing account that previously did","page_number":163,"box":{"x":68,"y":710,"width":817,"height":11}},{"id":"61d8ba1b-a9fc-4f0e-9437-e3bb50d15107","block_type":"box","text":"not provide this option, a Telephone Exchange Authorization Form must be filed with the Transfer Agent. This form is","page_number":163,"box":{"x":69,"y":725,"width":826,"height":11}},{"id":"c9e10bb7-ddf6-4d79-9184-0a66a14195f5","block_type":"box","text":"available from the Transfer Agent. Once this election has been made, the shareholder may simply contact the Fund by","page_number":163,"box":{"x":69,"y":740,"width":840,"height":11}},{"id":"e0470cf3-5963-456a-a691-6c7f1d151b99","block_type":"box","text":"telephone at (800) 441-7762 to request the exchange. During periods of substantial economic or market change,","page_number":163,"box":{"x":68,"y":755,"width":811,"height":11}},{"id":"ca5bf7ee-fc1e-40e2-b0a0-7f214d2c1cd0","block_type":"box","text":"telephone exchanges may be difficult to complete and shareholders may have to submit exchange requests to the","page_number":163,"box":{"x":68,"y":770,"width":815,"height":12}},{"id":"92c76006-2162-41bb-b11a-7a2fd59fd9f7","block_type":"box","text":"Transfer Agent in writing.","page_number":163,"box":{"x":68,"y":785,"width":175,"height":12}},{"id":"1eb007f2-5c15-42d2-9fda-d6b7b9ccf08f","block_type":"box","text":"If the exchanging shareholder does not currently own shares of the investment por tfolio whose shares are being","page_number":163,"box":{"x":102,"y":808,"width":800,"height":11}},{"id":"cba099e3-0e41-41f8-9bf5-7e5692009771","block_type":"box","text":"acquired, a new account will be established with the same registration, dividend and capital gain options and broker","page_number":163,"box":{"x":69,"y":823,"width":828,"height":12}},{"id":"bd1a86eb-a7fa-4d4a-94ee-fa2d09b38bec","block_type":"box","text":"of record as the account from which shares are exchanged, unless otherwise specified in writing by the shareholder","page_number":163,"box":{"x":69,"y":838,"width":826,"height":12}},{"id":"b2a984e9-2b9a-4fb6-b0e5-75f877178269","block_type":"box","text":"with all signatures guaranteed by an eligible guarantor institution as defined below. In order to par ticipate in the","page_number":163,"box":{"x":68,"y":853,"width":797,"height":12}},{"id":"9cf79d3f-a8ee-4d64-b821-44caeafc9a8b","block_type":"box","text":"Automatic Investment Program or establish a Systematic Withdrawal Plan for the new account, however, an","page_number":163,"box":{"x":68,"y":869,"width":763,"height":11}},{"id":"6b127144-f071-4659-8f9b-e1ffe0a0653c","block_type":"box","text":"exchanging shareholder must file a specific written request.","page_number":163,"box":{"x":69,"y":884,"width":424,"height":11}},{"id":"64bf05d0-d85e-4609-9274-76768e148dce","block_type":"box","text":"II-119","page_number":163,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"a3608fc3-dfaf-4f7a-beea-eac0d567c7ca","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":163,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"3d154d00-85ff-40ed-83f2-b255293fb806","block_type":"box","text":"Any share exchange must satisfy the requirements relating to the minimum initial investment requirement, and","page_number":164,"box":{"x":101,"y":45,"width":790,"height":11}},{"id":"e35ec65c-90bc-4b13-88bb-40b46c3c91da","block_type":"box","text":"must be legally available for sale in the state of the investor’s residence. For U.S. federal income tax purposes, a","page_number":164,"box":{"x":69,"y":60,"width":808,"height":11}},{"id":"e89ceca9-8d6f-4add-a91f-1606c8905082","block_type":"box","text":"share exchange is a taxable event and, accordingly, a capital gain or loss may be realized. Before making an","page_number":164,"box":{"x":69,"y":75,"width":771,"height":11}},{"id":"ea23600e-989f-412b-91a8-f3c9181c9d93","block_type":"box","text":"exchange request, shareholders should consult a tax or other financial adviser and should consider the investment","page_number":164,"box":{"x":69,"y":90,"width":819,"height":11}},{"id":"838dba02-05c3-43fb-9b4d-03c16254f7d5","block_type":"box","text":"objective, policies and restrictions of the investment por tfolio into which the shareholder is making an exchange.","page_number":164,"box":{"x":69,"y":105,"width":802,"height":11}},{"id":"01d9a6fc-4719-4c19-88e4-77f36f09238b","block_type":"box","text":"Brokers may charge a fee for handling exchanges.","page_number":164,"box":{"x":70,"y":120,"width":354,"height":12}},{"id":"44d40a79-bbc3-405f-8ea0-918789a0904c","block_type":"box","text":"The Funds reserve the right to suspend, modify or terminate the exchange privilege at any time. Notice will be","page_number":164,"box":{"x":101,"y":143,"width":782,"height":11}},{"id":"3273b765-7c35-4f87-afc8-a99d7f6cfbec","block_type":"box","text":"given to shareholders of any material modification or termination except where notice is not required. The Funds","page_number":164,"box":{"x":68,"y":158,"width":800,"height":11}},{"id":"829fd3c2-82c1-4b31-88ca-4821bf227dc3","block_type":"box","text":"reserve the right to reject any telephone exchange request. Telephone exchanges may be subject to limitations as to","page_number":164,"box":{"x":69,"y":173,"width":831,"height":11}},{"id":"43aff2e2-6bc0-4308-90af-25134c2feded","block_type":"box","text":"amount or frequency, and to other restrictions that may be established from time to time to ensure that exchanges","page_number":164,"box":{"x":69,"y":188,"width":818,"height":12}},{"id":"15f58c0a-4701-4862-9949-b7b0961678a4","block_type":"box","text":"do not operate to the disadvantage of any por tfolio or its shareholders.","page_number":164,"box":{"x":69,"y":203,"width":506,"height":12}},{"id":"da079090-9d30-4dc3-824c-16b189342b2a","block_type":"box","text":"The Funds, the Administrators and BRIL will employ reasonable procedures to confirm that instructions","page_number":164,"box":{"x":101,"y":226,"width":733,"height":11}},{"id":"fd0d96a5-f873-44eb-9525-62c399406e86","block_type":"box","text":"communicated by telephone are genuine. The Funds, the Administrators and BRIL will not be liable for any loss,","page_number":164,"box":{"x":69,"y":241,"width":793,"height":11}},{"id":"af7d2b9d-d6c3-4033-bdde-bcf33af1777b","block_type":"box","text":"liability, cost or expense for acting upon telephone instructions reasonably believed to be genuine in accordance with","page_number":164,"box":{"x":70,"y":256,"width":832,"height":12}},{"id":"c0eedc78-713c-4060-85b6-9fe02dbf2589","block_type":"box","text":"such procedures. By use of the exchange privilege, the investor authorizes the Fund’s Transfer Agent to act on","page_number":164,"box":{"x":69,"y":271,"width":785,"height":12}},{"id":"7158f380-0d6b-4798-8523-e09a84e349df","block_type":"box","text":"telephonic or written exchange instructions from any person representing himself to be the investor and believed by","page_number":164,"box":{"x":68,"y":286,"width":825,"height":12}},{"id":"8ffb774d-4c2f-4005-8518-50d54df908aa","block_type":"box","text":"the Fund’s Transfer Agent to be genuine. The records of the Fund’s Transfer Agent per taining to such instructions are","page_number":164,"box":{"x":68,"y":302,"width":837,"height":11}},{"id":"6c91fbb6-b91b-405b-8155-8629df9af7c8","block_type":"box","text":"binding. The exchange privilege may be modified or terminated at any time upon 60 days’ notice to affected","page_number":164,"box":{"x":69,"y":317,"width":767,"height":11}},{"id":"409daf47-5039-4c54-afe9-9b7984d6b752","block_type":"box","text":"shareholders. The exchange privilege is only available in states where the exchange may legally be made.","page_number":164,"box":{"x":69,"y":332,"width":750,"height":11}},{"id":"db465d5a-4910-4b9d-8d87-006ed520f43e","block_type":"box","text":"Each Fund reserves the right to limit the number of times an investor may exercise the exchange privilege.","page_number":164,"box":{"x":102,"y":355,"width":757,"height":11}},{"id":"e7fc2eab-8af3-4793-8527-d32fb5d7f9a7","block_type":"box","text":"Cer tain Funds may suspend the continuous offering of their shares to the general public at any time and may resume","page_number":164,"box":{"x":69,"y":370,"width":837,"height":11}},{"id":"3a086d87-59b1-48b9-bb46-f376940b3966","block_type":"box","text":"such offering from time to time. The exchange privilege is available only to U.S. shareholders in states where the","page_number":164,"box":{"x":69,"y":385,"width":805,"height":11}},{"id":"98672978-97fd-4e7f-b009-48509714e83f","block_type":"box","text":"exchange legally may be made. The exchange privilege may be applicable to other new mutual funds whose shares","page_number":164,"box":{"x":69,"y":400,"width":817,"height":11}},{"id":"904d1687-3804-4eb6-9262-57eb3ff3d047","block_type":"box","text":"may be distributed by the Distributor.","page_number":164,"box":{"x":69,"y":415,"width":262,"height":11}},{"id":"a91916e4-6e3e-4f26-9bfc-14f785637cbc","block_type":"box","text":"Participation in Fee-Based Programs","page_number":164,"box":{"x":69,"y":445,"width":266,"height":11}},{"id":"97e10c5e-cd2a-44d6-a7c1-303210369b3a","block_type":"box","text":"If you par ticipate in cer tain fee-based programs offered by BlackRock or an affiliate of BlackRock, or selected","page_number":164,"box":{"x":102,"y":468,"width":780,"height":11}},{"id":"eb8449fc-f67c-4c05-a7ce-894d8b52c8f5","block_type":"box","text":"securities dealers or other financial intermediaries that have agreements with the Distributor or in cer tain fee-based","page_number":164,"box":{"x":69,"y":483,"width":826,"height":11}},{"id":"22fb6660-ad61-4808-9ded-4965621c0d44","block_type":"box","text":"programs in which BlackRock par ticipates, you may be able to buy Institutional Shares, including by exchanges from","page_number":164,"box":{"x":70,"y":498,"width":825,"height":11}},{"id":"b88524f4-80f0-4547-80af-a602f91490de","block_type":"box","text":"other share classes. Sales charges on the shares being exchanged may be reduced or waived under cer tain","page_number":164,"box":{"x":69,"y":513,"width":770,"height":12}},{"id":"626927cf-02f1-49c4-ae53-1634b5d8a2a5","block_type":"box","text":"circumstances. You generally cannot transfer shares held through a fee-based program into another account. Instead,","page_number":164,"box":{"x":69,"y":528,"width":837,"height":12}},{"id":"e6a6b3b4-8311-4a87-9b96-c1fce9de8eea","block_type":"box","text":"if you choose to leave the fee-based program, you may have to redeem your shares held through the program and","page_number":164,"box":{"x":70,"y":543,"width":808,"height":12}},{"id":"7bb4250d-226a-440f-96ae-9cae0b8f7217","block_type":"box","text":"purchase shares of another class, which may be subject to distribution and service fees. This may be a taxable event","page_number":164,"box":{"x":70,"y":559,"width":838,"height":11}},{"id":"46b89712-8e6d-407e-9c69-0513738af44d","block_type":"box","text":"and you may pay any applicable sales charges or redemption fee. Please speak to your financial intermediary for","page_number":164,"box":{"x":69,"y":574,"width":804,"height":11}},{"id":"153c2404-6321-43b1-b06e-743c6f434e2d","block_type":"box","text":"information about specific policies and procedures applicable to your account.","page_number":164,"box":{"x":70,"y":589,"width":555,"height":11}},{"id":"8aef5e2c-3bb1-4fb2-ae6f-48133fe14741","block_type":"box","text":"Generally, upon termination of a fee-based program, the shares may be liquidated or the shares can be held in","page_number":164,"box":{"x":102,"y":612,"width":788,"height":11}},{"id":"8d26a443-f06d-44b1-b97a-77b2c225f237","block_type":"box","text":"an account. In cer tain circumstances, when a shareholder chooses to continue to hold the shares, whatever share","page_number":164,"box":{"x":69,"y":627,"width":817,"height":10}},{"id":"4c00fde2-4224-4589-afb9-8cd343ae56fe","block_type":"box","text":"class was held in the program can be held after termination. Shares that have been held for less than specified","page_number":164,"box":{"x":69,"y":642,"width":796,"height":11}},{"id":"26d8e6ea-d18f-4270-9478-3aac4e493ef4","block_type":"box","text":"periods within the program may be subject to a fee upon redemption. Shareholders that held Investor A or","page_number":164,"box":{"x":70,"y":657,"width":754,"height":11}},{"id":"94b1f74b-3db5-4b1d-ac34-b582cc2b243a","block_type":"box","text":"Institutional Shares in the program may be eligible to purchase additional shares of the respective share class of a","page_number":164,"box":{"x":70,"y":672,"width":820,"height":11}},{"id":"1e8a9f07-4112-4836-a246-c918f2c911f6","block_type":"box","text":"Fund, but may be subject to upfront sales charges with respect to Investor A Shares. Additional purchases of","page_number":164,"box":{"x":70,"y":687,"width":777,"height":11}},{"id":"3a289330-6fcb-4b52-995c-170eadfcdbd8","block_type":"box","text":"Institutional Shares are permitted only if you have an existing position at the time of purchase or are otherwise","page_number":164,"box":{"x":70,"y":702,"width":791,"height":12}},{"id":"4e08cbca-a223-4a4d-9d3e-a47d33b467bb","block_type":"box","text":"eligible to purchase Institutional Shares. Please speak to your financial intermediary for more information.","page_number":164,"box":{"x":69,"y":717,"width":756,"height":12}},{"id":"abeb0000-7b39-44cc-9295-63e7175d6847","block_type":"box","text":"Cer tain financial intermediaries may, in connection with a change in account type (for example, due to leaving a","page_number":164,"box":{"x":102,"y":740,"width":793,"height":11}},{"id":"c8987660-211e-4a70-865f-ab40e8fb40ea","block_type":"box","text":"fee-based program or upon termination of the fee-based program) or otherwise in accordance with the financial","page_number":164,"box":{"x":68,"y":755,"width":791,"height":11}},{"id":"a6a1c3e9-62d4-45ef-845b-9ca64d7e721c","block_type":"box","text":"intermediary’s policies and procedures, exchange the share class held in the program for another share class of the","page_number":164,"box":{"x":70,"y":770,"width":830,"height":12}},{"id":"fb9b719a-41ae-475d-b2d7-424c674a4f30","block_type":"box","text":"same fund, provided that the exchanged shares are not subject to a sales charge and the shareholder meets the","page_number":164,"box":{"x":69,"y":785,"width":807,"height":12}},{"id":"38bdc7e2-060f-4604-9e16-98ae8b9ded4e","block_type":"box","text":"eligibility requirements of the new share class. Please speak to your financial intermediary for information about","page_number":164,"box":{"x":69,"y":801,"width":801,"height":11}},{"id":"e0828102-0973-4d02-bebd-70900769d5c0","block_type":"box","text":"specific policies and procedures applicable to your account.","page_number":164,"box":{"x":69,"y":816,"width":424,"height":11}},{"id":"ebffe4e5-abfc-49e4-af38-103a2e7a7487","block_type":"box","text":"Details about the features of each fee-based program and the relevant charges, terms and conditions are","page_number":164,"box":{"x":102,"y":838,"width":752,"height":12}},{"id":"c112e82e-65f7-49dc-aa30-6807bda69aed","block_type":"box","text":"included in the client agreement for each fee-based program and are available from your financial professional,","page_number":164,"box":{"x":70,"y":853,"width":789,"height":12}},{"id":"573c1e5c-bf8f-4468-a4bf-26f8d97c8f1d","block_type":"box","text":"selected securities dealer or other financial intermediary. Please speak to your financial intermediary for more","page_number":164,"box":{"x":69,"y":869,"width":785,"height":11}},{"id":"48d5eeb9-6f53-407e-978c-d5d19da94ff7","block_type":"box","text":"information.","page_number":164,"box":{"x":70,"y":884,"width":83,"height":9}},{"id":"60f71cdd-bdde-4f1a-8442-dd1e9ec93a01","block_type":"box","text":"II-120","page_number":164,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"e18438a2-798d-4e22-b718-02b80f98e124","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":164,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"cc49e92f-858e-4d7c-986f-ab3613a6234e","block_type":"box","text":"Retirement and Education Savings Plans","page_number":165,"box":{"x":69,"y":45,"width":296,"height":11}},{"id":"e1a1ac86-d22c-4d35-9000-0ac4636d669f","block_type":"box","text":"Individual retirement accounts and other retirement and education savings plans are available from your financial","page_number":165,"box":{"x":102,"y":67,"width":805,"height":12}},{"id":"7e518816-6bb4-4309-bfa0-df7290b1b4ee","block_type":"box","text":"intermediary. Under these plans, investments may be made in a Fund (other than a Municipal Fund) and cer tain of","page_number":165,"box":{"x":70,"y":82,"width":815,"height":12}},{"id":"2e890001-904c-4468-8e9d-000bb1a57d22","block_type":"box","text":"the other mutual funds sponsored by the Manager or its affiliates as well as in other securities. There may be fees","page_number":165,"box":{"x":68,"y":98,"width":819,"height":11}},{"id":"ca94acef-cf70-4a8c-ae4d-8205fbc619e9","block_type":"box","text":"associated with investing through these plans. Information with respect to these plans is available on request from","page_number":165,"box":{"x":69,"y":113,"width":820,"height":11}},{"id":"3c4809c4-b222-4e3b-9d91-6da442ecd80a","block_type":"box","text":"your financial intermediary.","page_number":165,"box":{"x":68,"y":128,"width":191,"height":11}},{"id":"c1de7115-2f59-45c9-a821-5c4867b7fd3c","block_type":"box","text":"Dividends received in each of the plans referred to above are exempt from U.S. federal taxation until distributed","page_number":165,"box":{"x":102,"y":150,"width":796,"height":11}},{"id":"e4eebb12-3c8d-40f8-9800-78c045494b9d","block_type":"box","text":"from the plans and, in the case of Roth IRAs and education savings plans, may be exempt from taxation when","page_number":165,"box":{"x":68,"y":166,"width":784,"height":11}},{"id":"5f51f97a-08c4-4c76-b549-952d31128ac9","block_type":"box","text":"distributed as well. Investors considering par ticipation in any retirement or education savings plan should review","page_number":165,"box":{"x":69,"y":181,"width":801,"height":11}},{"id":"fc7908cb-f273-4d90-a891-11a91f98c1c3","block_type":"box","text":"specific tax laws relating to the plan and should consult their attorneys or tax advisors with respect to the","page_number":165,"box":{"x":69,"y":196,"width":753,"height":11}},{"id":"6235f33b-d6f7-4eff-b1a0-2d20db7ef3fb","block_type":"box","text":"establishment and maintenance of any such plan.","page_number":165,"box":{"x":69,"y":211,"width":354,"height":11}},{"id":"16ab6a43-ab31-4488-8713-f4963216dee1","block_type":"box","text":"Automatic Investment Plans","page_number":165,"box":{"x":68,"y":241,"width":207,"height":9}},{"id":"1f82f110-9435-4569-b5e6-b608765e6935","block_type":"box","text":"Investor class shareholders and cer tain Service Share shareholders who were shareholders of the Compass","page_number":165,"box":{"x":102,"y":264,"width":773,"height":11}},{"id":"554397e9-5ccb-4f4e-92b7-b55a59b89f33","block_type":"box","text":"Capital Group of Funds at the time of its combination with The PNC","page_number":165,"box":{"x":69,"y":279,"width":477,"height":11}},{"id":"909d6dc0-2599-46e1-ae07-bd35422125f7","block_type":"box","text":"®","page_number":165,"box":{"x":547,"y":279,"width":6,"height":5}},{"id":"edb96f2d-c1e5-4b13-b8ae-898dec87d590","block_type":"box","text":"Fund in 1996 may arrange for periodic","page_number":165,"box":{"x":559,"y":279,"width":272,"height":11}},{"id":"3038e8b7-0487-4d7d-8ac3-ab7e74c6f801","block_type":"box","text":"investments in that Fund through automatic deductions from a checking or savings account. The minimum pre","page_number":165,"box":{"x":70,"y":294,"width":787,"height":11}},{"id":"a0e9ae1c-b047-45ee-a602-b1ace3e7a406","block_type":"box","text":"authorized investment amount is $50. If you buy shares of a Fund through cer tain accounts, no minimum charge to","page_number":165,"box":{"x":69,"y":309,"width":822,"height":11}},{"id":"b6d64465-21fc-4c62-afc9-83c4e2e47dcd","block_type":"box","text":"your bank account is required. Contact your financial adviser or other financial intermediary for more information.","page_number":165,"box":{"x":68,"y":324,"width":805,"height":11}},{"id":"05916601-d5a7-49ed-90a0-1fe9c4d92ccb","block_type":"box","text":"Automatic Dividend Reinvestment Plan","page_number":165,"box":{"x":68,"y":355,"width":285,"height":9}},{"id":"4025ab8b-2800-453e-99bc-133c367b655a","block_type":"box","text":"Each Fund will distribute substantially all of its net investment income and net realized capital gains, if any, to","page_number":165,"box":{"x":102,"y":377,"width":782,"height":12}},{"id":"e8036342-f88a-4f5d-bd31-2a7f6031ba4b","block_type":"box","text":"shareholders. All distributions are automatically reinvested at NAV in the form of additional full and fractional shares","page_number":165,"box":{"x":69,"y":392,"width":828,"height":12}},{"id":"f49d1ef7-7dd4-4393-8247-cb638a3ee3eb","block_type":"box","text":"of the same class of shares of the relevant Fund unless a shareholder elects otherwise or as otherwise set for th in a","page_number":165,"box":{"x":69,"y":407,"width":839,"height":9}},{"id":"40a35dc0-ff5d-447b-80d7-541a6ea4b366","block_type":"box","text":"Fund’s prospectus. Such election, or any revocation thereof, must be made in writing to the Transfer Agent, and will","page_number":165,"box":{"x":70,"y":423,"width":822,"height":11}},{"id":"9468154b-c668-4f17-8092-17adf43b6e34","block_type":"box","text":"become effective with respect to dividends paid after its receipt by the Transfer Agent.","page_number":165,"box":{"x":69,"y":438,"width":614,"height":11}},{"id":"92390004-ba83-4bf8-965c-4ffea9b04018","block_type":"box","text":"Systematic Withdrawal Plans","page_number":165,"box":{"x":68,"y":468,"width":214,"height":11}},{"id":"03aad413-6c34-466b-a78d-c780f4c146d5","block_type":"box","text":"Shareholders may receive regular distributions from their accounts via a Systematic Withdrawal Plan (“SWP”).","page_number":165,"box":{"x":102,"y":491,"width":780,"height":11}},{"id":"5f957fc8-f785-41e5-8c38-14e212dff424","block_type":"box","text":"Upon commencement of the SWP, the account must have a current value of $10,000 or more in a Fund.","page_number":165,"box":{"x":70,"y":505,"width":742,"height":12}},{"id":"40ab1532-19eb-4948-b6ec-9e74a82f5504","block_type":"box","text":"Shareholders may elect to receive automatic cash payments of $50 or more at any interval. You may choose any day","page_number":165,"box":{"x":69,"y":520,"width":834,"height":12}},{"id":"e7944e3a-7a63-4410-b8da-9d4595098998","block_type":"box","text":"for the withdrawal. If no day is specified, the withdrawals will be processed on the 25th day of the month or, if such","page_number":165,"box":{"x":68,"y":536,"width":823,"height":11}},{"id":"611a2f5f-614f-4fe3-9c08-5d3b52f417f9","block_type":"box","text":"day is not a business day, on the prior business day and are paid promptly thereafter. An investor may utilize the SWP","page_number":165,"box":{"x":69,"y":551,"width":840,"height":11}},{"id":"ea837ae4-ff5c-4748-949b-2f7dcbad5ecb","block_type":"box","text":"by completing the Systematic Withdrawal Plan Application Form which may be obtained by visiting our website at","page_number":165,"box":{"x":69,"y":566,"width":800,"height":11}},{"id":"2fcff74a-5cba-4559-b2b1-93907c2ef975","block_type":"box","text":"www.blackrock.com.","page_number":165,"box":{"x":68,"y":582,"width":142,"height":8}},{"id":"23de3d85-d62b-4643-89d0-96ed4ce8fb5d","block_type":"box","text":"Shareholders should realize that if withdrawals exceed income dividends their invested principal in the account","page_number":165,"box":{"x":102,"y":604,"width":789,"height":11}},{"id":"b081e605-f4c4-432d-a8ac-5b5e73c81773","block_type":"box","text":"will be depleted. To par ticipate in the SWP, shareholders must have their dividends automatically reinvested.","page_number":165,"box":{"x":68,"y":619,"width":774,"height":11}},{"id":"9c580963-b75a-4054-98ff-eeeb1ef4fbc8","block_type":"box","text":"Shareholders may change or cancel the SWP at any time, upon written notice to the Fund, or by calling the Fund at","page_number":165,"box":{"x":69,"y":634,"width":815,"height":12}},{"id":"7eef970f-e6b1-4583-94d3-d81b40ac0880","block_type":"box","text":"(800) 441-7762. Purchases of additional Investor A or Investor P Shares of the Fund concurrently with withdrawals","page_number":165,"box":{"x":69,"y":649,"width":817,"height":12}},{"id":"9f493caa-9f2f-476d-90f2-6a93b14153bc","block_type":"box","text":"may be disadvantageous to investors because of the sales charges involved and, therefore, are discouraged. No","page_number":165,"box":{"x":69,"y":664,"width":803,"height":12}},{"id":"066aca73-9e11-4d86-95c5-3d516ae3548d","block_type":"box","text":"CDSC will be assessed on redemptions of Investor C Shares made through the SWP that do not exceed 12% of the","page_number":165,"box":{"x":69,"y":680,"width":820,"height":11}},{"id":"96d2a2d3-13f3-41d8-93a4-bf240af88505","block_type":"box","text":"original investment on an annualized basis. For example, monthly, quar terly and semi-annual SWP redemptions of","page_number":165,"box":{"x":69,"y":695,"width":810,"height":11}},{"id":"3cca47fc-7073-4d18-8715-0396322f0ab9","block_type":"box","text":"Investor C Shares will not be subject to the CDSC if they do not exceed 1% (monthly), 3% (quar terly) and 6% (semi","page_number":165,"box":{"x":70,"y":710,"width":816,"height":11}},{"id":"0a7dd0ce-917c-4577-bb7a-0cc73e7a6fa3","block_type":"box","text":"annually), respectively, of an account’s NAV on the redemption date. SWP redemptions of Investor C Shares in excess","page_number":165,"box":{"x":69,"y":725,"width":840,"height":11}},{"id":"0d6874c3-da79-4eec-b489-19c6d721ff81","block_type":"box","text":"of this limit are still subject to the applicable CDSC.","page_number":165,"box":{"x":69,"y":740,"width":367,"height":11}},{"id":"e7591617-c32d-45d9-b9ff-00e762410695","block_type":"box","text":"For this reason, a shareholder may not par ticipate in the Automatic Investment Plan described above (see “How","page_number":165,"box":{"x":102,"y":763,"width":798,"height":11}},{"id":"c49e5168-cb42-4127-8ce7-e241004c1214","block_type":"box","text":"to Buy, Sell, Exchange and Transfer Shares” or “How to Buy, Sell and Exchange Shares,” as applicable, in the Fund’s","page_number":165,"box":{"x":68,"y":778,"width":834,"height":11}},{"id":"c594cc95-2947-436e-aea9-a2ba00c203fc","block_type":"box","text":"Prospectus) and the SWP at the same time.","page_number":165,"box":{"x":69,"y":793,"width":311,"height":11}},{"id":"724328ef-5d05-4ab6-9128-d640486e39bb","block_type":"box","text":"Dividend Allocation Plan","page_number":165,"box":{"x":69,"y":823,"width":176,"height":9}},{"id":"dda76cca-1fde-4b20-9419-054625f8ee43","block_type":"box","text":"The Dividend Allocation Plan, as applicable, allows shareholders to elect to have all their dividends and any other","page_number":165,"box":{"x":101,"y":846,"width":807,"height":11}},{"id":"fc50226e-7ed3-47aa-949c-726f9c934179","block_type":"box","text":"distributions from any Eligible Fund (which means funds so designated by the Distributor from time to time)","page_number":165,"box":{"x":69,"y":861,"width":763,"height":11}},{"id":"a3d007e7-a4d7-4b91-9045-68f61f8ae1e3","block_type":"box","text":"automatically invested at NAV in one other such Eligible Fund designated by the shareholder, provided the account","page_number":165,"box":{"x":69,"y":876,"width":814,"height":11}},{"id":"cba79fe8-2d3e-46b6-bd04-88c3831872f7","block_type":"box","text":"into which the dividends and distributions are directed is initially funded with the requisite minimum amount.","page_number":165,"box":{"x":70,"y":891,"width":771,"height":11}},{"id":"c0a7da16-96dc-4fbe-8b63-12f4a3258049","block_type":"box","text":"II-121","page_number":165,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"d02a5736-5ed0-4d20-9cce-bb8c1eab7ba4","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":165,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"53dd95c5-7f1b-4a2f-9501-7694cea16224","block_type":"box","text":"PRICING OF SHARES","page_number":166,"box":{"x":406,"y":45,"width":167,"height":10}},{"id":"767acbfb-658d-403e-8565-c595fd947b4a","block_type":"box","text":"Determination of Net Asset Value","page_number":166,"box":{"x":69,"y":76,"width":243,"height":8}},{"id":"91d03ba4-6b3e-4f24-9e1f-faa3989ef393","block_type":"box","text":"Valuation of Shares.","page_number":166,"box":{"x":101,"y":98,"width":145,"height":9}},{"id":"97006015-a532-4c4d-aeb5-8bfa63089e55","block_type":"box","text":"The NAV for each class of shares of each Fund is generally calculated as of the close of","page_number":166,"box":{"x":252,"y":98,"width":626,"height":11}},{"id":"3bd16755-5216-4372-a9db-be6fb0136629","block_type":"box","text":"regular trading hours on the NYSE (currently 4:00 p.m. Eastern Time) on each business day the NYSE is open.","page_number":166,"box":{"x":69,"y":113,"width":785,"height":12}},{"id":"e6ef9acf-f668-420d-ba3f-bffaa5897c8c","block_type":"box","text":"Valuation of assets held by a Fund is as follows:","page_number":166,"box":{"x":68,"y":128,"width":343,"height":12}},{"id":"6cb123bf-30da-44e9-9bbe-77feff7b3dbf","block_type":"box","text":"Equity Investments.","page_number":166,"box":{"x":102,"y":151,"width":143,"height":11}},{"id":"62718398-717b-4157-b9b7-04727fa2faaa","block_type":"box","text":"Equity securities traded on a recognized securities exchange (","page_number":166,"box":{"x":252,"y":151,"width":439,"height":11}},{"id":"dd5c0375-ba7c-4874-a1d3-6799e7e45605","block_type":"box","text":"e.g.","page_number":166,"box":{"x":693,"y":153,"width":25,"height":9}},{"id":"02dff7f6-0236-4273-9c1c-4888916c3e91","block_type":"box","text":", NYSE), on separate","page_number":166,"box":{"x":720,"y":151,"width":147,"height":11}},{"id":"4bd98244-3d3e-4998-a1bc-ff4733999f01","block_type":"box","text":"trading boards of a securities exchange or through a market system that provides contemporaneous transaction","page_number":166,"box":{"x":68,"y":166,"width":799,"height":11}},{"id":"42025789-3020-4ea9-aa77-0a64df97fa99","block_type":"box","text":"pricing information (each, an “Exchange”) are valued using information obtained via independent pricing services,","page_number":166,"box":{"x":70,"y":181,"width":808,"height":12}},{"id":"922d2569-9448-400a-bf54-0dfce70957c6","block_type":"box","text":"generally at the Exchange closing price or if an Exchange closing price is not available, the last traded price on that","page_number":166,"box":{"x":68,"y":196,"width":820,"height":12}},{"id":"77e5262b-248c-45da-84e7-4cc8d87494c7","block_type":"box","text":"Exchange prior to the time as of which the assets or liabilities are valued. However, under cer tain circumstances,","page_number":166,"box":{"x":70,"y":212,"width":805,"height":11}},{"id":"d977f08e-66aa-499f-abd5-4e3334ac0c7e","block_type":"box","text":"other means of determining current market value may be used. If an equity security is traded on more than one","page_number":166,"box":{"x":69,"y":227,"width":793,"height":11}},{"id":"efecf164-864e-4158-9c31-872fc8efce7d","block_type":"box","text":"Exchange, the current market value of the security where it is primarily traded generally will be used. In the event that","page_number":166,"box":{"x":70,"y":242,"width":836,"height":11}},{"id":"698404c3-5caa-4116-9676-71b30ef85c99","block_type":"box","text":"there are no sales involving an equity security held by a Fund on a day on which the Fund values such security, the","page_number":166,"box":{"x":68,"y":257,"width":815,"height":11}},{"id":"ea1deccb-6fb3-4a71-9e50-1c538f41888f","block_type":"box","text":"last bid (long positions) or ask (shor t positions) price, if available, will be used as the value of such security. If a Fund","page_number":166,"box":{"x":70,"y":272,"width":837,"height":11}},{"id":"57474ff1-a619-4e98-ae51-99bdaa579685","block_type":"box","text":"holds both long and shor t positions in the same security, the last bid price will be applied to securities held long and","page_number":166,"box":{"x":69,"y":287,"width":832,"height":11}},{"id":"3daf74ab-2133-4a12-bc27-e0ea82127efe","block_type":"box","text":"the last ask price will be applied to securities sold shor t. If no bid or ask price is available on a day on which a Fund","page_number":166,"box":{"x":68,"y":302,"width":828,"height":11}},{"id":"199335f9-f12f-4a78-a5d7-de5a64043227","block_type":"box","text":"values such security, the prior day’s price will be used, unless BlackRock determines that such prior day’s price no","page_number":166,"box":{"x":68,"y":318,"width":819,"height":11}},{"id":"1c38f689-862c-4fe0-a07f-cf6587568c5f","block_type":"box","text":"longer reflects the fair value of the security, in which case such asset would be treated as a Fair Value Asset (as","page_number":166,"box":{"x":70,"y":332,"width":798,"height":12}},{"id":"7868e199-0faa-4773-be8b-5734d65f28b1","block_type":"box","text":"defined below).","page_number":166,"box":{"x":69,"y":348,"width":106,"height":11}},{"id":"56223c19-82e3-4945-8030-a22c86910d64","block_type":"box","text":"Fixed-Income Investments.","page_number":166,"box":{"x":102,"y":370,"width":194,"height":9}},{"id":"62ddc34a-13fa-4fc3-92ec-bda3c65b945b","block_type":"box","text":"Fixed-income securities are generally valued using bid prices provided by dealers or","page_number":166,"box":{"x":304,"y":371,"width":592,"height":11}},{"id":"93c2ed2a-bae6-4d5e-9500-01733fb71203","block_type":"box","text":"prices (including evaluated prices) supplied by the Fund’s approved independent third-par ty pricing services, each in","page_number":166,"box":{"x":70,"y":386,"width":825,"height":11}},{"id":"a347d3e6-47e9-4bf5-813f-1c695f94e13b","block_type":"box","text":"accordance with the Valuation Procedures. The pricing services may use valuation models that utilize cer tain inputs","page_number":166,"box":{"x":69,"y":401,"width":823,"height":11}},{"id":"5db56196-f6b2-4906-8ba5-9bb2e59248ff","block_type":"box","text":"and assumptions to derive values, including transaction data (","page_number":166,"box":{"x":69,"y":416,"width":443,"height":11}},{"id":"864fddd1-1fb0-4391-b955-6b79664a6f92","block_type":"box","text":"e.g.","page_number":166,"box":{"x":514,"y":417,"width":24,"height":10}},{"id":"ec0001f4-9ef4-4cfa-8ef1-3e5fb59cd50b","block_type":"box","text":", recent representative bids and offers), credit","page_number":166,"box":{"x":541,"y":416,"width":328,"height":11}},{"id":"6d1440cc-bea4-4f14-a1ec-c7a3d20b5cf8","block_type":"box","text":"quality information, perceived market movements, news, and other relevant information and by other methods, which","page_number":166,"box":{"x":69,"y":431,"width":834,"height":11}},{"id":"716b0da0-c3d0-4282-b49a-9b263bd39fbf","block_type":"box","text":"may include consideration of: yields or prices of securities of comparable quality, coupon, maturity and type;","page_number":166,"box":{"x":69,"y":446,"width":769,"height":11}},{"id":"06f4e727-39f3-40e6-aa80-31e420648a47","block_type":"box","text":"indications as to values from dealers; general market conditions; and/or other factors and assumptions. Pricing","page_number":166,"box":{"x":70,"y":461,"width":797,"height":11}},{"id":"cfcb0c5c-02c7-497e-ac2f-148af2608db9","block_type":"box","text":"services generally value fixed-income securities assuming orderly transactions of an institutional round lot size, but","page_number":166,"box":{"x":69,"y":476,"width":821,"height":11}},{"id":"1a4192a0-ccea-4297-8fb0-25ad1ddda969","block_type":"box","text":"the Fund may hold or transact in such securities in smaller, odd lot sizes. Odd lots of securities in cer tain asset","page_number":166,"box":{"x":68,"y":491,"width":798,"height":11}},{"id":"494cad9c-3055-4c50-b340-9b688232bb7f","block_type":"box","text":"classes may trade at lower prices than institutional round lots, and the value ultimately realized when the securities","page_number":166,"box":{"x":69,"y":507,"width":825,"height":11}},{"id":"0fe8c467-8846-4424-b397-ddc31cd5577b","block_type":"box","text":"are sold could differ from the prices used by a Fund. The amor tized cost method of valuation may be used with","page_number":166,"box":{"x":69,"y":521,"width":791,"height":12}},{"id":"e5bf32ac-2b62-4bf4-a5ac-54c339eaa416","block_type":"box","text":"respect to debt obligations with 60 days or less remaining to maturity unless such method does not represent fair","page_number":166,"box":{"x":69,"y":537,"width":814,"height":11}},{"id":"8b831da8-b5e1-48c0-8456-8c207fc04ef9","block_type":"box","text":"value. Cer tain fixed-income investments, including asset-backed and mor tgage related securities, may be valued","page_number":166,"box":{"x":68,"y":552,"width":802,"height":11}},{"id":"faf81e1e-81d3-469a-9908-fb13f9f66aba","block_type":"box","text":"based on valuation models that consider the estimated cash flows of each tranche of the issuer, establish a","page_number":166,"box":{"x":69,"y":567,"width":773,"height":10}},{"id":"ff550aca-e102-4ce7-b0ca-07990e140f73","block_type":"box","text":"benchmark yield and develop an estimated tranche specific spread to the benchmark yield based on the unique","page_number":166,"box":{"x":69,"y":582,"width":795,"height":11}},{"id":"15df6c10-fba0-42f0-b2fe-246174680fc7","block_type":"box","text":"attributes of the tranche.","page_number":166,"box":{"x":69,"y":597,"width":176,"height":9}},{"id":"23696b7c-46ba-48c4-96ab-5adf7b1596f9","block_type":"box","text":"Options, Futures, Swaps and Other Derivatives.","page_number":166,"box":{"x":101,"y":620,"width":344,"height":11}},{"id":"bea568dd-782d-4187-8a3e-9c781b765268","block_type":"box","text":"Exchange-traded equity options (except ETF options, equity","page_number":166,"box":{"x":453,"y":620,"width":416,"height":11}},{"id":"52ca4e3a-97b6-4145-afe9-a2a8f61ab8a0","block_type":"box","text":"index options or those that are customized) for which market quotations are readily available are valued at the mean","page_number":166,"box":{"x":70,"y":635,"width":829,"height":11}},{"id":"66070d28-4801-4cf7-8f8d-f24dba4a8aca","block_type":"box","text":"of the last bid and ask prices as quoted on the Exchange or the board of trade on which such options are traded. In","page_number":166,"box":{"x":69,"y":650,"width":824,"height":11}},{"id":"5e68f3ef-1825-493b-84d4-6fe7c3491357","block_type":"box","text":"the event that there is no mean price available for an exchange-traded equity option held by a Fund on a day on which","page_number":166,"box":{"x":68,"y":665,"width":838,"height":11}},{"id":"a64e326c-0acb-435d-a3fe-d58773beccb9","block_type":"box","text":"the Fund values such option, the last bid (long positions) or ask (shor t positions) price, if available, will be used as","page_number":166,"box":{"x":68,"y":680,"width":820,"height":12}},{"id":"e2c4ce2a-9165-459c-b462-0b92cbacfc1b","block_type":"box","text":"the value of such option. If no bid or ask price is available on a day on which a Fund values such option, the prior","page_number":166,"box":{"x":68,"y":695,"width":808,"height":11}},{"id":"6011aece-04d0-4df5-9bd3-d8e33ee51625","block_type":"box","text":"day’s price will be used, unless BlackRock determines that such prior day’s price no longer reflects the fair value of","page_number":166,"box":{"x":69,"y":710,"width":824,"height":12}},{"id":"f09731a1-fb05-491b-8cce-7e3116c03e63","block_type":"box","text":"the option, in which case such option will be treated as a Fair Value Asset. Customized exchange-traded equity","page_number":166,"box":{"x":68,"y":726,"width":789,"height":11}},{"id":"e9577906-2444-4b1d-b01e-797d8c704981","block_type":"box","text":"options, ETF options, equity index options and OTC derivatives, may be valued using a mathematical model which","page_number":166,"box":{"x":69,"y":741,"width":807,"height":11}},{"id":"25a1d1ee-f306-4583-bec4-1c5002eccd82","block_type":"box","text":"may incorporate a number of market data factors. Financial futures contracts and options thereon, which are traded","page_number":166,"box":{"x":69,"y":756,"width":824,"height":11}},{"id":"e9ca6a8a-1694-45bd-b764-6ba3bc9c0863","block_type":"box","text":"on exchanges, are valued at their last sale price or settle price as of the close of such exchanges. Swap agreements","page_number":166,"box":{"x":69,"y":771,"width":833,"height":11}},{"id":"3f5266f8-0020-40bc-bd66-070f5a503fd8","block_type":"box","text":"and other derivatives are generally valued daily based upon quotations from market makers or by a pricing service in","page_number":166,"box":{"x":69,"y":786,"width":830,"height":11}},{"id":"a7949ae5-54cd-4206-81bf-34135d17c5d0","block_type":"box","text":"accordance with the Valuation Procedures.","page_number":166,"box":{"x":69,"y":801,"width":301,"height":9}},{"id":"fef69393-c607-4b45-815f-ab79c324b54b","block_type":"box","text":"Underlying Funds.","page_number":166,"box":{"x":102,"y":824,"width":128,"height":11}},{"id":"952d8c72-40a4-4eb3-b6fe-789c8826331a","block_type":"box","text":"Shares of underlying open-end funds (including money market funds) are valued at NAV.","page_number":166,"box":{"x":237,"y":824,"width":621,"height":11}},{"id":"81286f51-24af-4789-a130-c5d1b268b1a5","block_type":"box","text":"Shares of underlying exchange-traded closed-end funds or other ETFs will be valued at their most recent closing price.","page_number":166,"box":{"x":69,"y":839,"width":837,"height":11}},{"id":"8cb24fb5-f4ec-433e-93f3-ce7cab7154ce","block_type":"box","text":"General Valuation Information.","page_number":166,"box":{"x":101,"y":862,"width":220,"height":9}},{"id":"99cd7a9a-72f4-4b0e-b9d5-a7f45c1261d9","block_type":"box","text":"Prices obtained from independent third-par ty pricing services, broker-dealers or","page_number":166,"box":{"x":328,"y":862,"width":564,"height":11}},{"id":"62fd567e-0e2b-430b-a1d8-9794639a834b","block_type":"box","text":"market makers to value each Fund’s securities and other assets and liabilities are based on information available at","page_number":166,"box":{"x":69,"y":877,"width":831,"height":9}},{"id":"b5523736-2550-4a7e-afdf-b3619213aa45","block_type":"box","text":"the time the Fund values its assets and liabilities. In the event that a pricing service quotation is revised or updated","page_number":166,"box":{"x":68,"y":892,"width":828,"height":11}},{"id":"fd4ccc09-2eb6-4a33-9c55-7e8829ec3924","block_type":"box","text":"II-122","page_number":166,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"7b2d630a-5ff8-4895-b44b-faad18c2dbcc","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":166,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"b1cda5a2-7cb9-4c56-b0e7-e8119a7f684c","block_type":"box","text":"subsequent to the day on which the Fund valued such security, the revised pricing service quotation generally will be","page_number":167,"box":{"x":69,"y":45,"width":829,"height":11}},{"id":"29752793-4c6d-4707-86d3-cd9caf55ba7f","block_type":"box","text":"applied prospectively. Such determination will be made considering per tinent facts and circumstances surrounding","page_number":167,"box":{"x":69,"y":60,"width":817,"height":11}},{"id":"ebb074d4-7e23-4c00-8ff8-fc7c0ee62877","block_type":"box","text":"the revision.","page_number":167,"box":{"x":68,"y":75,"width":87,"height":9}},{"id":"b0147cdf-7b1f-4152-b2b6-4c1b7b9ba17f","block_type":"box","text":"In determining the market value of por tfolio investments, the Fund may employ independent third-par ty pricing","page_number":167,"box":{"x":102,"y":98,"width":784,"height":11}},{"id":"15e0ae38-6812-483f-8506-9e2bb0002cd9","block_type":"box","text":"services, which may use, without limitation, evaluated pricing methods that take into consideration market indexes,","page_number":167,"box":{"x":69,"y":113,"width":823,"height":11}},{"id":"883c9b13-a6c0-4a2b-b775-cef9df642a43","block_type":"box","text":"matrices, yield curves and other specified inputs and assumptions. This may result in the assets being valued at a","page_number":167,"box":{"x":69,"y":128,"width":818,"height":11}},{"id":"e9479d8f-f462-4936-924b-7e37422f85dc","block_type":"box","text":"price different from the price that would have been determined had the evaluated pricing method not been used. The","page_number":167,"box":{"x":70,"y":143,"width":832,"height":11}},{"id":"0dc2f90e-71b3-4010-8ff8-c4d5d6be4e20","block_type":"box","text":"price the Fund could receive upon the sale of any par ticular por tfolio investment may differ from the Fund’s valuation","page_number":167,"box":{"x":70,"y":158,"width":832,"height":11}},{"id":"93b2c51b-0137-461a-816f-0c0fb5becb19","block_type":"box","text":"of the investment, par ticularly for assets that trade in thin or volatile markets or that are valued using a fair valuation","page_number":167,"box":{"x":69,"y":173,"width":834,"height":11}},{"id":"46a08918-acb0-4bb9-ba77-532899856a97","block_type":"box","text":"methodology or a price provided by an independent pricing service. As a result, the price received upon the sale of an","page_number":167,"box":{"x":69,"y":188,"width":837,"height":12}},{"id":"6324258e-e7ad-4acb-a4b8-e2ed89a4219f","block_type":"box","text":"investment may be less than the value ascribed by the Fund, and the Fund could realize a greater than expected loss","page_number":167,"box":{"x":70,"y":204,"width":833,"height":11}},{"id":"5b7e478c-6c75-414f-a4b3-7cba14be21de","block_type":"box","text":"or lesser than expected gain upon the sale of the investment. The Fund’s ability to value its investment may also be","page_number":167,"box":{"x":69,"y":218,"width":827,"height":12}},{"id":"7538e53a-961c-40ad-ab0b-01bf60353b78","block_type":"box","text":"impacted by technological issues and/or errors by pricing services or other third-par ty service providers.","page_number":167,"box":{"x":70,"y":234,"width":741,"height":11}},{"id":"21d6409f-87ef-4ced-bda5-8374fdd07503","block_type":"box","text":"In the event that application of the methods of valuation discussed above result in a price for a security which is","page_number":167,"box":{"x":102,"y":256,"width":800,"height":11}},{"id":"328c10df-c568-4b69-847b-bc5c7c409e0d","block_type":"box","text":"deemed not to be representative of the fair market value of such security, the security will be valued by, under the","page_number":167,"box":{"x":69,"y":271,"width":811,"height":12}},{"id":"16a81002-c8fd-4213-a98b-795ed9a23bfa","block_type":"box","text":"direction of or in accordance with a method approved by BlackRock, the Fund’s valuation designee, as reflecting fair","page_number":167,"box":{"x":69,"y":286,"width":827,"height":12}},{"id":"44aef379-c3ef-49e9-a83d-6a206403ec87","block_type":"box","text":"value. All other assets and liabilities (including securities for which market quotations are not readily available) held","page_number":167,"box":{"x":68,"y":302,"width":824,"height":11}},{"id":"d3860bc2-7d55-4de0-bb03-8e1c2d34cca9","block_type":"box","text":"by a Fund (including restricted securities and private market investments, as applicable) are valued at fair value as","page_number":167,"box":{"x":69,"y":317,"width":817,"height":11}},{"id":"63c61845-9d0f-43ff-9318-f9503fa75873","block_type":"box","text":"determined in good faith by BlackRock pursuant to the Valuation Procedures. Any assets and liabilities which are","page_number":167,"box":{"x":69,"y":332,"width":802,"height":11}},{"id":"f2670527-7649-4e03-971e-2d834c53782e","block_type":"box","text":"denominated in a foreign currency are translated into U.S. dollars at the prevailing market rates.","page_number":167,"box":{"x":69,"y":347,"width":685,"height":11}},{"id":"2cfd808e-e781-4bee-b494-58e6a29efdb0","block_type":"box","text":"Cer tain of the securities acquired by the Funds may be traded on foreign exchanges or OTC markets on days on","page_number":167,"box":{"x":102,"y":370,"width":795,"height":11}},{"id":"2adb2b21-172b-46bb-85af-f461b6f1d885","block_type":"box","text":"which a Fund’s NAV is not calculated. In such cases, the NAV of a Fund’s shares may be significantly affected on","page_number":167,"box":{"x":68,"y":385,"width":805,"height":11}},{"id":"91049fdf-845b-46cf-bb55-aa2217e4cdb8","block_type":"box","text":"days when investors can neither purchase nor redeem shares of the Fund.","page_number":167,"box":{"x":69,"y":400,"width":529,"height":11}},{"id":"596c4f50-7398-4af1-8868-535efec4f759","block_type":"box","text":"Fair Value.","page_number":167,"box":{"x":102,"y":423,"width":74,"height":9}},{"id":"61ba6548-1351-4adf-b65a-b0b76b5c9a55","block_type":"box","text":"When market quotations are not readily available or are believed by BlackRock to be unreliable, a","page_number":167,"box":{"x":183,"y":423,"width":693,"height":11}},{"id":"a91ded36-9d15-4b98-a0f9-7490b7164e85","block_type":"box","text":"Fund’s investments are valued at fair value (“Fair Value Assets”). Fair Value Assets are valued by BlackRock in","page_number":167,"box":{"x":70,"y":438,"width":785,"height":11}},{"id":"63de7169-18ae-4712-a592-f00c4413143a","block_type":"box","text":"accordance with the Valuation Procedures. Pursuant to Rule 2a-5 under the Investment Company Act, the Board of","page_number":167,"box":{"x":69,"y":453,"width":816,"height":11}},{"id":"effb9683-3eae-451f-9185-d0467480e523","block_type":"box","text":"Directors has designated BlackRock as the valuation designee for the respective Funds for which it serves as","page_number":167,"box":{"x":70,"y":468,"width":779,"height":11}},{"id":"47f47202-a48d-42a8-b1ee-155298a1f03a","block_type":"box","text":"investment adviser. BlackRock may reasonably conclude that a market quotation is not readily available or is","page_number":167,"box":{"x":70,"y":483,"width":773,"height":11}},{"id":"cc61c2ef-5625-4dc0-bbcf-0d3b2a193259","block_type":"box","text":"unreliable if, among other things, a security or other asset or liability does not have a price source due to its","page_number":167,"box":{"x":69,"y":498,"width":772,"height":11}},{"id":"1862b0af-b85b-4389-9287-ba2e6cadabcc","block_type":"box","text":"complete lack of trading, if BlackRock believes a market quotation from a broker-dealer or other source is unreliable","page_number":167,"box":{"x":69,"y":513,"width":826,"height":12}},{"id":"dc29dfbb-dcaa-46fe-b796-a03d3760f258","block_type":"box","text":"(","page_number":167,"box":{"x":69,"y":529,"width":3,"height":10}},{"id":"c69c2de9-a8f1-47f8-b8f0-83d9c1992984","block_type":"box","text":"e.g.","page_number":167,"box":{"x":74,"y":530,"width":25,"height":10}},{"id":"d236d9c5-6e5a-4807-b52a-f51141cbe6ae","block_type":"box","text":", where it varies significantly from a recent trade, or no longer reflects the fair value of the security or other asset","page_number":167,"box":{"x":101,"y":528,"width":806,"height":12}},{"id":"d8cdadc0-eb10-424a-aa04-75bd39f9dcdc","block_type":"box","text":"or liability subsequent to the most recent market quotation), or where the security or other asset or liability is only","page_number":167,"box":{"x":69,"y":544,"width":813,"height":11}},{"id":"61254769-293d-4d1e-9604-8eb5a6df54b5","block_type":"box","text":"thinly traded or due to the occurrence of a significant event subsequent to the most recent market quotation. For this","page_number":167,"box":{"x":68,"y":559,"width":837,"height":11}},{"id":"c0876b85-d91d-490d-bfc9-81b84150e224","block_type":"box","text":"purpose, a “significant event” is deemed to occur if BlackRock determines, in its reasonable business judgment, that","page_number":167,"box":{"x":70,"y":574,"width":838,"height":11}},{"id":"97733981-58c6-4f45-a22a-0e01020d0277","block_type":"box","text":"an event has occurred after the close of trading for an asset or liability but prior to or at the time of pricing a Fund’s","page_number":167,"box":{"x":69,"y":589,"width":824,"height":11}},{"id":"655f3452-3236-43e3-a678-665714425547","block_type":"box","text":"assets or liabilities, is likely to cause a material change to the last exchange closing price or closing market price of","page_number":167,"box":{"x":69,"y":604,"width":828,"height":11}},{"id":"42fc261b-d771-48d0-9a4c-fcc2209fa715","block_type":"box","text":"one or more assets held by, or liabilities of, the Fund. On any day the NYSE is open and a foreign market or the","page_number":167,"box":{"x":69,"y":619,"width":793,"height":11}},{"id":"e9fde53e-08fc-4462-a943-1dabf2c3cdaf","block_type":"box","text":"primary exchange on which a foreign asset or liability is traded is closed, such asset or liability will be valued using","page_number":167,"box":{"x":70,"y":634,"width":819,"height":12}},{"id":"528d65f9-25af-43d9-88aa-9433a7abe3ee","block_type":"box","text":"the prior day’s price, provided that BlackRock is not aware of any significant event or other information that would","page_number":167,"box":{"x":68,"y":649,"width":810,"height":12}},{"id":"a5955cb5-14e7-4a61-b993-d04e2076ed43","block_type":"box","text":"cause such price to no longer reflect the fair value of the asset or liability, in which case such asset or liability would","page_number":167,"box":{"x":69,"y":664,"width":828,"height":12}},{"id":"811d2069-8c3b-4fe2-aeea-3e65602c7540","block_type":"box","text":"be treated as a Fair Value Asset. For cer tain foreign assets, a third-par ty vendor supplies evaluated, systematic fair","page_number":167,"box":{"x":69,"y":680,"width":822,"height":11}},{"id":"e3a3be85-6220-4644-a15b-194c794177c7","block_type":"box","text":"value pricing based upon the movement of a proprietary multi-factor model after the relevant foreign markets have","page_number":167,"box":{"x":68,"y":695,"width":814,"height":11}},{"id":"d1da6001-45df-46b0-9bcb-b47a759f30fd","block_type":"box","text":"closed. This systematic fair value pricing methodology is designed to correlate the prices of foreign assets in one or","page_number":167,"box":{"x":69,"y":710,"width":827,"height":11}},{"id":"ee2dc23d-e0a6-4a6b-a734-21b1b3751d3b","block_type":"box","text":"more non-U.S. markets following the close of the local markets to the prices that might have prevailed as of a Fund’s","page_number":167,"box":{"x":69,"y":725,"width":834,"height":11}},{"id":"a24a9dd4-aefc-4c60-a9ff-73f1a58bebe9","block_type":"box","text":"pricing time.","page_number":167,"box":{"x":70,"y":740,"width":85,"height":11}},{"id":"ebb5f853-b5a9-44d7-ab04-9c6581067329","block_type":"box","text":"BlackRock’s Rule 2a-5 Committee is responsible for reviewing and approving methodologies by investment type","page_number":167,"box":{"x":102,"y":763,"width":794,"height":11}},{"id":"5023dfd4-96c9-4cc5-a3cb-0a3a304183c9","block_type":"box","text":"and significant inputs used in the fair valuation of Fund assets or liabilities. In addition, the Funds’ accounting agent","page_number":167,"box":{"x":69,"y":778,"width":829,"height":11}},{"id":"66cbd374-81a9-4236-9800-57425ba94627","block_type":"box","text":"assists BlackRock by periodically endeavoring to confirm the prices it receives from all third-par ty pricing services,","page_number":167,"box":{"x":69,"y":793,"width":813,"height":11}},{"id":"b23825dd-6873-47da-be67-e0ee84b9406a","block_type":"box","text":"index providers and broker-dealers. BlackRock regularly evaluates the values assigned to the securities and other","page_number":167,"box":{"x":70,"y":808,"width":808,"height":11}},{"id":"bfa3a0e8-077f-458d-a4e5-53161f0c64fb","block_type":"box","text":"assets and liabilities of the Funds.","page_number":167,"box":{"x":69,"y":823,"width":245,"height":9}},{"id":"cc2bc3eb-a3c4-4a59-9dea-eedd95cc25b8","block_type":"box","text":"When determining the price for a Fair Value Asset, BlackRock will seek to determine the price that a Fund might","page_number":167,"box":{"x":101,"y":846,"width":795,"height":11}},{"id":"550b2875-0549-43f2-82c3-b59281ed99f7","block_type":"box","text":"reasonably expect to receive from the current sale of that asset or liability in an arm’s-length transaction on the date","page_number":167,"box":{"x":69,"y":861,"width":832,"height":11}},{"id":"013ce498-fb24-43e6-b20a-8ccc85c5fa12","block_type":"box","text":"on which the asset or liability is being valued, and does not seek to determine the price a Fund might reasonably","page_number":167,"box":{"x":69,"y":876,"width":805,"height":11}},{"id":"aaecf1ef-f9b1-44f2-9dc7-ae25f9cd5b0c","block_type":"box","text":"expect to receive for selling an asset or liability at a later time or if it holds the asset or liability to maturity. Fair value","page_number":167,"box":{"x":69,"y":891,"width":834,"height":12}},{"id":"7a384314-be66-4cfb-8ff0-58f32a46bae3","block_type":"box","text":"II-123","page_number":167,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"1f33de98-c728-485c-a50d-55fd724d4862","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":167,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"a2080dae-f427-43fa-a9c5-7ec3b275a913","block_type":"box","text":"determinations will be based upon all available factors that BlackRock deems relevant at the time of the","page_number":168,"box":{"x":69,"y":45,"width":744,"height":11}},{"id":"07ffce02-5d9f-48a9-9190-9803b7f87b98","block_type":"box","text":"determination, and may be based on analytical values determined by BlackRock using proprietary or third-par ty","page_number":168,"box":{"x":69,"y":60,"width":791,"height":11}},{"id":"06674ae3-136b-4b0b-bd5f-bcf7b72bc665","block_type":"box","text":"valuation models.","page_number":168,"box":{"x":68,"y":75,"width":125,"height":9}},{"id":"66642e0c-ff32-4a89-b4af-f3d3f19e1f95","block_type":"box","text":"Fair value represents a good faith approximation of the value of an asset or liability. When determining the fair","page_number":168,"box":{"x":102,"y":98,"width":785,"height":11}},{"id":"fcf5c03b-0bf0-4192-944d-9c812a5b3191","block_type":"box","text":"value of an investment, one or more fair value methodologies may be used (depending on cer tain factors, including","page_number":168,"box":{"x":68,"y":113,"width":822,"height":11}},{"id":"5ec21782-6386-497f-81c1-7deb4963a3b8","block_type":"box","text":"the asset type). For example, the investment may be initially priced based on the original cost of the investment or,","page_number":168,"box":{"x":68,"y":128,"width":820,"height":11}},{"id":"07333d6b-ad06-401e-bde1-1cdc38f44444","block_type":"box","text":"alternatively, using proprietary or third-par ty models that may rely upon one or more unobservable inputs. Prices of","page_number":168,"box":{"x":69,"y":143,"width":818,"height":11}},{"id":"92d0a660-a54f-4a16-9bf6-a9709248d6ae","block_type":"box","text":"actual, executed or historical transactions in the relevant investment (or comparable instruments) or, where","page_number":168,"box":{"x":69,"y":158,"width":766,"height":11}},{"id":"c6eff3f2-1b96-47ba-92e7-5b307986789c","block_type":"box","text":"appropriate, an appraisal by a third-par ty experienced in the valuation of similar instruments, may also be used as a","page_number":168,"box":{"x":69,"y":173,"width":828,"height":11}},{"id":"7370151d-8349-4e06-94e7-63c536d494ab","block_type":"box","text":"basis for establishing the fair value of an investment.","page_number":168,"box":{"x":69,"y":188,"width":378,"height":12}},{"id":"38de1191-6b03-4ab8-98a3-9ad808e1676d","block_type":"box","text":"The fair value of one or more assets or liabilities may not, in retrospect, be the price at which those assets or","page_number":168,"box":{"x":101,"y":211,"width":784,"height":11}},{"id":"659fd089-4436-42bf-9acf-3649ba7ab2ff","block_type":"box","text":"liabilities could have been sold during the period in which the par ticular fair values were used in determining a Fund’s","page_number":168,"box":{"x":70,"y":226,"width":836,"height":11}},{"id":"a767f7c4-2d39-4e7f-a6b2-b01bc44caf15","block_type":"box","text":"NAV. As a result, a Fund’s sale or redemption of its shares at NAV, at a time when a holding or holdings are valued at","page_number":168,"box":{"x":70,"y":241,"width":834,"height":11}},{"id":"daa54ec0-2678-4c2e-8daa-43a420e4cd78","block_type":"box","text":"fair value, may have the effect of diluting or increasing the economic interest of existing shareholders.","page_number":168,"box":{"x":68,"y":256,"width":728,"height":12}},{"id":"044cc542-806e-4244-8176-57a78221e7cc","block_type":"box","text":"Each Fund’s annual audited financial statements, which are prepared in accordance with accounting principles","page_number":168,"box":{"x":102,"y":279,"width":786,"height":11}},{"id":"07492de4-1519-412b-92ee-c992e0f8b6ec","block_type":"box","text":"generally accepted in the United States of America (“US GAAP”), follow the requirements for valuation set for th in","page_number":168,"box":{"x":68,"y":294,"width":809,"height":11}},{"id":"c4e4d7e1-5979-40fb-800a-5a2945bdaac8","block_type":"box","text":"Financial Accounting Standards Board Accounting Standards Codification Topic 820, “Fair Value Measurements and","page_number":168,"box":{"x":70,"y":309,"width":821,"height":11}},{"id":"75b26185-cf9d-48ce-b6db-57dd733f93a6","block_type":"box","text":"Disclosures” (“ASC 820”), which defines and establishes a framework for measuring fair value under US GAAP and","page_number":168,"box":{"x":70,"y":324,"width":818,"height":12}},{"id":"811dde9f-98bd-4c98-892c-af795814e4ca","block_type":"box","text":"expands financial statement disclosure requirements relating to fair value measurements.","page_number":168,"box":{"x":69,"y":339,"width":641,"height":12}},{"id":"cd2c908d-106b-4e75-8456-830a965ad888","block_type":"box","text":"Generally, ASC 820 and other accounting rules applicable to funds and various assets in which they invest are","page_number":168,"box":{"x":102,"y":362,"width":786,"height":11}},{"id":"6dd74542-cf73-4f08-8957-c341155312f9","block_type":"box","text":"evolving. Such changes may adversely affect a Fund. For example, the evolution of rules governing the determination","page_number":168,"box":{"x":69,"y":377,"width":832,"height":12}},{"id":"71645218-0f36-4fac-b645-609f47d92086","block_type":"box","text":"of the fair market value of assets or liabilities, to the extent such rules become more stringent, would tend to","page_number":168,"box":{"x":69,"y":392,"width":780,"height":12}},{"id":"8bed8d94-3ffb-428d-a0df-5b8d912f3f26","block_type":"box","text":"increase the cost and/or reduce the availability of third-par ty determinations of fair market value. This may in turn","page_number":168,"box":{"x":70,"y":407,"width":810,"height":12}},{"id":"6bd0c1de-74ed-49c2-b229-064a330ef01c","block_type":"box","text":"increase the costs associated with selling assets or affect their liquidity due to a Fund’s inability to obtain a third","page_number":168,"box":{"x":70,"y":423,"width":810,"height":11}},{"id":"1a912c86-b162-4033-bb25-14264ff65d2d","block_type":"box","text":"par ty determination of fair market value.","page_number":168,"box":{"x":70,"y":438,"width":285,"height":11}},{"id":"cc283d91-60b9-432b-b50a-1d66f68c0a0f","block_type":"box","text":"Computation of Offering Price Per Share","page_number":168,"box":{"x":69,"y":468,"width":292,"height":11}},{"id":"f34fb38f-7f89-41d7-a189-b81043e5346b","block_type":"box","text":"See “Computation of Offering Price Per Share” in Par t I of a Fund’s SAI for an illustration of the computation of","page_number":168,"box":{"x":102,"y":491,"width":791,"height":11}},{"id":"0e74e888-1530-49b3-a6c1-9fec59c63e7f","block_type":"box","text":"the offering price for shares of your Fund.","page_number":168,"box":{"x":68,"y":506,"width":295,"height":11}},{"id":"43789434-dec7-4780-99c3-bf1899212d91","block_type":"box","text":"PORTFOLIO TRANSACTIONS AND BROKERAGE","page_number":168,"box":{"x":303,"y":535,"width":373,"height":10}},{"id":"74819254-e068-4dc8-a82c-21fff40e1e13","block_type":"box","text":"Transactions in Portfolio Securities","page_number":168,"box":{"x":68,"y":566,"width":257,"height":9}},{"id":"2419f446-7f8f-4fc8-b15a-b2a3eef0edc7","block_type":"box","text":"Subject to policies established by the Board of Directors, BlackRock is primarily responsible for the execution of","page_number":168,"box":{"x":102,"y":588,"width":798,"height":11}},{"id":"f15b0b5d-ca9d-4c0b-a5ec-a9f77ff10511","block_type":"box","text":"a Fund’s por tfolio transactions and the allocation of brokerage. BlackRock does not execute transactions through any","page_number":168,"box":{"x":69,"y":603,"width":839,"height":12}},{"id":"c88b5efc-0d5d-4aea-bc51-e9261927089c","block_type":"box","text":"par ticular broker or dealer, but seeks to obtain the best net results for the Fund, taking into account cer tain factors","page_number":168,"box":{"x":70,"y":618,"width":822,"height":12}},{"id":"375f3a30-09a6-41ad-950c-8b5283fca0af","block_type":"box","text":"set out below. While BlackRock generally seeks reasonable trade execution costs, a Fund does not necessarily pay","page_number":168,"box":{"x":69,"y":634,"width":820,"height":11}},{"id":"f0e233c7-6641-4c8c-9b7d-2a00560c01a6","block_type":"box","text":"the lowest spread or commission available, and payment of the lowest commission or spread is not necessarily","page_number":168,"box":{"x":68,"y":649,"width":798,"height":11}},{"id":"395f2f7c-2c57-4322-a775-faaab9aee2ec","block_type":"box","text":"consistent with obtaining the best price and execution in par ticular transactions. Subject to applicable legal","page_number":168,"box":{"x":69,"y":664,"width":765,"height":11}},{"id":"6168bc53-63ae-4764-8eac-a6f2bab09893","block_type":"box","text":"requirements, BlackRock may select a broker based par tly upon brokerage or research services provided to","page_number":168,"box":{"x":69,"y":679,"width":768,"height":11}},{"id":"c9a7c588-5b60-40e1-8c20-a119509e4014","block_type":"box","text":"BlackRock and its clients, including a Fund. In return for such services, BlackRock may cause a Fund to pay a higher","page_number":168,"box":{"x":70,"y":694,"width":830,"height":11}},{"id":"a72689a7-fc78-4fe2-95a6-1ccc56ba5845","block_type":"box","text":"commission than other brokers would charge if BlackRock determines in good faith that the commission is","page_number":168,"box":{"x":69,"y":709,"width":760,"height":11}},{"id":"da2546e1-2eac-460f-91c9-445f7926e088","block_type":"box","text":"reasonable in relation to the services provided.","page_number":168,"box":{"x":69,"y":725,"width":336,"height":10}},{"id":"82562979-e8c7-4ccb-94b8-cbf64b188b6d","block_type":"box","text":"In the case of Feeder Funds, because each Feeder Fund generally invests exclusively in beneficial interests of a","page_number":168,"box":{"x":102,"y":747,"width":794,"height":11}},{"id":"6f88b9e3-8255-42be-b63e-7924826b103f","block_type":"box","text":"Master Por tfolio, it is expected that all transactions in por tfolio securities will be entered into by the Master Por tfolio.","page_number":168,"box":{"x":70,"y":762,"width":835,"height":11}},{"id":"191d2d96-faff-4fb0-9dcb-dca548eb057d","block_type":"box","text":"In selecting brokers or dealers to execute por tfolio transactions, the Manager and sub-advisers seek to obtain","page_number":168,"box":{"x":102,"y":785,"width":784,"height":11}},{"id":"572c4ecf-d159-43af-97ce-dfc227a88bea","block_type":"box","text":"the best price and most favorable execution for a Fund, taking into account a variety of factors including: (i) the size,","page_number":168,"box":{"x":68,"y":800,"width":829,"height":11}},{"id":"13eb9f2e-80af-45e0-83ef-a4a1ab05c589","block_type":"box","text":"nature and character of the security or instrument being traded and the markets in which it is purchased or sold;","page_number":168,"box":{"x":69,"y":815,"width":802,"height":11}},{"id":"ca646398-a9fb-459d-8409-503780776c3b","block_type":"box","text":"(ii) the desired timing of the transaction; (iii) BlackRock’s knowledge of the expected commission rates and spreads","page_number":168,"box":{"x":69,"y":830,"width":826,"height":11}},{"id":"691e6e5f-7fde-4689-8ded-e94f82a78d96","block_type":"box","text":"currently available; (iv) the activity existing and expected in the market for the par ticular security or instrument,","page_number":168,"box":{"x":69,"y":845,"width":789,"height":12}},{"id":"040527b5-9595-46d5-9ef6-3777f0b0faab","block_type":"box","text":"including any anticipated execution difficulties; (v) the full range of brokerage services provided; (vi) the broker’s or","page_number":168,"box":{"x":70,"y":860,"width":818,"height":12}},{"id":"7fe3a7b0-f9bb-461f-b775-af7762e3df7e","block_type":"box","text":"dealer’s capital; (vii) the quality of research and research services provided; (viii) the reasonableness of the","page_number":168,"box":{"x":69,"y":875,"width":769,"height":12}},{"id":"2df6e3e4-11de-4479-85ec-913113260046","block_type":"box","text":"commission, dealer spread or its equivalent for the specific transaction; and (ix) BlackRock’s knowledge of any actual","page_number":168,"box":{"x":69,"y":891,"width":837,"height":11}},{"id":"932d0010-d29a-4970-bf3b-4c5a44c2a544","block_type":"box","text":"or apparent operational problems of a broker or dealer.","page_number":168,"box":{"x":69,"y":906,"width":391,"height":11}},{"id":"f9b151e8-d0cf-4117-8a8b-cbd4f79cf143","block_type":"box","text":"II-124","page_number":168,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"0684e39f-e4de-4288-966f-e86df0c7b206","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":168,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"6609db47-1fc2-4e5b-8e48-8cab00f0947e","block_type":"box","text":"Section 28(e) of the Exchange Act (“Section 28(e)”) permits an investment adviser, under cer tain circumstances","page_number":169,"box":{"x":102,"y":45,"width":801,"height":11}},{"id":"f5f365aa-11c6-4343-95d7-fe661f5381fe","block_type":"box","text":"to cause an account to pay a broker or dealer a commission for effecting a transaction that exceeds the amount","page_number":169,"box":{"x":68,"y":60,"width":802,"height":11}},{"id":"51f17f36-086a-4590-92ac-1e4ef8b7abf0","block_type":"box","text":"another broker or dealer would have charged for effecting the same transaction in recognition of the value of","page_number":169,"box":{"x":69,"y":75,"width":775,"height":11}},{"id":"5b3eddcb-4910-44b4-9767-cf8ff830e243","block_type":"box","text":"brokerage and research services provided by that broker or dealer. This includes commissions paid on riskless","page_number":169,"box":{"x":69,"y":90,"width":790,"height":11}},{"id":"a9a56b24-c827-4011-aca4-7bc3a1c4bbf1","block_type":"box","text":"principal transactions under cer tain conditions. Brokerage and research services include: (1) furnishing advice as to","page_number":169,"box":{"x":70,"y":105,"width":827,"height":11}},{"id":"a5dd83db-987b-4cec-901b-431327145970","block_type":"box","text":"the value of securities, including pricing and appraisal advice, credit analysis, risk measurement analysis,","page_number":169,"box":{"x":68,"y":120,"width":753,"height":12}},{"id":"f800b291-10e8-445a-bf36-272522e046bd","block_type":"box","text":"per formance and other analysis, as well as the advisability of investing in, purchasing or selling securities, and the","page_number":169,"box":{"x":70,"y":135,"width":818,"height":12}},{"id":"f9a5d0a3-a8c3-4a77-b2d1-89af1e195295","block_type":"box","text":"availability of securities or purchasers or sellers of securities; (2) furnishing analyses and repor ts concerning issuers,","page_number":169,"box":{"x":69,"y":150,"width":837,"height":12}},{"id":"647af6c6-b5c5-41f1-a544-b95fa24df892","block_type":"box","text":"industries, securities, economic factors and trends, por tfolio strategy, and the per formance of accounts; and","page_number":169,"box":{"x":70,"y":166,"width":775,"height":11}},{"id":"228f07b0-9c18-479f-9659-bbf3227db166","block_type":"box","text":"(3) effecting securities transactions and per forming functions incidental to securities transactions (such as","page_number":169,"box":{"x":69,"y":181,"width":764,"height":11}},{"id":"eedace80-683f-44c4-bfbb-87c2a99c1576","block_type":"box","text":"clearance, settlement, and custody). BlackRock believes that access to independent investment research is","page_number":169,"box":{"x":69,"y":196,"width":770,"height":11}},{"id":"8114a157-acc6-4ca8-902e-ff86a085c89a","block_type":"box","text":"beneficial to its investment decision-making processes and, therefore, to the Funds.","page_number":169,"box":{"x":69,"y":211,"width":599,"height":11}},{"id":"cf96d8a1-685d-4bd4-b5db-483b3778132b","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may par ticipate in client commission arrangements under which","page_number":169,"box":{"x":102,"y":234,"width":796,"height":11}},{"id":"6350cc63-9a3c-4715-8047-9f47ac36bf49","block_type":"box","text":"BlackRock may execute transactions through a broker-dealer and request that the broker-dealer allocate a por tion of","page_number":169,"box":{"x":70,"y":249,"width":829,"height":11}},{"id":"c07d50bc-4312-4117-911a-7183b2831653","block_type":"box","text":"the commissions or commission credits to another firm that provides research to BlackRock. BlackRock believes that","page_number":169,"box":{"x":68,"y":264,"width":839,"height":11}},{"id":"ce552a26-9cb9-4b0b-bffe-3d329b95ea07","block_type":"box","text":"research services obtained through soft dollar or commission sharing arrangements enhance its investment decision","page_number":169,"box":{"x":69,"y":279,"width":839,"height":11}},{"id":"1474a3e2-7c3c-4699-b414-08a3dd02107b","block_type":"box","text":"making capabilities, thereby increasing the prospects for higher investment returns. BlackRock will engage only in","page_number":169,"box":{"x":69,"y":294,"width":809,"height":11}},{"id":"879c2f37-a8f7-40a3-adc4-86c0d274b941","block_type":"box","text":"soft dollar or commission sharing transactions that comply with the requirements of Section 28(e). Cer tain Funds","page_number":169,"box":{"x":69,"y":309,"width":808,"height":11}},{"id":"da21c9ce-eb2d-4cdc-9e4a-c3b80b55bcd4","block_type":"box","text":"may be subject to additional regulations, including MiFID II. Under MiFID II, EU investment managers, including BIL,","page_number":169,"box":{"x":69,"y":325,"width":818,"height":11}},{"id":"b0a34ba4-13dd-4bd5-8680-620183a7509d","block_type":"box","text":"pay for any research out of their own resources and not through soft dollars or commission sharing arrangements.","page_number":169,"box":{"x":70,"y":339,"width":813,"height":12}},{"id":"99b810ef-d4f5-4647-97d9-52ce13cd1bc1","block_type":"box","text":"BlackRock regularly evaluates the soft dollar products and services utilized, as well as the overall soft dollar and","page_number":169,"box":{"x":70,"y":355,"width":801,"height":11}},{"id":"0de83e2f-a3ed-4a71-b2e5-20cb8338ffc8","block_type":"box","text":"commission sharing arrangements to ensure that trades are executed by firms that are regarded as best able to","page_number":169,"box":{"x":69,"y":370,"width":802,"height":11}},{"id":"1794cd92-96e4-44f4-8d4d-2c175811905a","block_type":"box","text":"execute trades for client accounts, while at the same time providing access to the research and other services","page_number":169,"box":{"x":69,"y":385,"width":790,"height":11}},{"id":"18d1fd50-f015-4d8e-8a63-6d4547d8ca53","block_type":"box","text":"BlackRock views as impactful to its trading results.","page_number":169,"box":{"x":70,"y":400,"width":361,"height":11}},{"id":"754fc1c5-b59a-483c-a6d1-99adfc71d028","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may utilize soft dollars and related services, including research","page_number":169,"box":{"x":102,"y":423,"width":791,"height":11}},{"id":"ea8e9b1d-5c7c-4438-b2d6-c3a8f17ccb35","block_type":"box","text":"(whether prepared by the broker-dealer or prepared by a third-par ty and provided to BlackRock by the broker-dealer)","page_number":169,"box":{"x":69,"y":438,"width":819,"height":11}},{"id":"bc8b7a03-9e94-4a2c-9c27-8d8a7abc0318","block_type":"box","text":"and execution or brokerage services within applicable rules and BlackRock’s policies to the extent that such","page_number":169,"box":{"x":69,"y":453,"width":772,"height":11}},{"id":"85d54978-011c-4ed6-9534-10105b42c9e7","block_type":"box","text":"permitted services do not compromise BlackRock’s ability to seek to obtain best execution. In this regard, the","page_number":169,"box":{"x":70,"y":468,"width":785,"height":11}},{"id":"3596dbd4-ecf7-4aa7-9fc0-ef7debf53312","block_type":"box","text":"por tfolio management investment and/or trading teams may consider a variety of factors, including the degree to","page_number":169,"box":{"x":70,"y":483,"width":806,"height":11}},{"id":"fe187e9b-b4fe-4e5f-9d1d-79f29a60a86f","block_type":"box","text":"which the broker-dealer: (a) provides access to company management; (b) provides access to their analysts;","page_number":169,"box":{"x":68,"y":498,"width":772,"height":11}},{"id":"23bf30d0-4806-472e-a290-ca856c787cd0","block_type":"box","text":"(c) provides meaningful/insightful research notes on companies or other potential investments; (d) facilitates calls on","page_number":169,"box":{"x":69,"y":513,"width":838,"height":12}},{"id":"c52e377b-d312-4455-ad53-e9dafec50d65","block_type":"box","text":"which meaningful or insightful ideas about companies or potential investments are discussed; (e) facilitates","page_number":169,"box":{"x":68,"y":528,"width":769,"height":12}},{"id":"46216cf8-87ed-4dc0-b777-5aaa190747c0","block_type":"box","text":"conferences at which meaningful or insightful ideas about companies or potential investments are discussed; or","page_number":169,"box":{"x":69,"y":543,"width":801,"height":12}},{"id":"68c7c4b3-3623-4db4-9cad-18e3d0f04e8b","block_type":"box","text":"(f) provides research tools such as market data, financial analysis, and other third-par ty related research and","page_number":169,"box":{"x":69,"y":559,"width":778,"height":11}},{"id":"dc1cd628-9987-4e4b-a4b1-33ad688a6438","block_type":"box","text":"brokerage tools that aid in the investment process.","page_number":169,"box":{"x":69,"y":574,"width":363,"height":11}},{"id":"49402909-e645-492a-a61f-6e715346576a","block_type":"box","text":"Research-oriented services for which BlackRock, unless prohibited by applicable law, might pay with Fund","page_number":169,"box":{"x":102,"y":596,"width":749,"height":12}},{"id":"2896f964-51ec-470d-b681-b80a700d4c0f","block_type":"box","text":"commissions may be in written form or through direct contact with individuals and may include information as to","page_number":169,"box":{"x":69,"y":612,"width":799,"height":11}},{"id":"6d4d6e48-b074-4c3f-bb47-f7f318ce6d62","block_type":"box","text":"par ticular companies or industries and securities or groups of securities, as well as market, economic, or","page_number":169,"box":{"x":70,"y":627,"width":752,"height":11}},{"id":"b3a4378f-6d4a-48af-90f0-53781b876718","block_type":"box","text":"institutional advice and statistical information, political developments and technical market information that assists","page_number":169,"box":{"x":70,"y":642,"width":823,"height":11}},{"id":"4b7cd5c7-19bc-4c32-a109-7b12e94fcb59","block_type":"box","text":"in the valuation of investments. Except as noted immediately below, research services furnished by brokers may be","page_number":169,"box":{"x":70,"y":657,"width":822,"height":11}},{"id":"69df781e-70eb-4afd-a0ee-6e400fd0207b","block_type":"box","text":"used in servicing some or all client accounts and not all services may be used in connection with the Fund or account","page_number":169,"box":{"x":69,"y":672,"width":840,"height":11}},{"id":"6b5f19ec-16cf-49e4-8781-9866de86b751","block_type":"box","text":"that paid commissions to the broker providing such services. In some cases, research information received from","page_number":169,"box":{"x":68,"y":687,"width":805,"height":11}},{"id":"a05e60e3-3926-4d12-9780-8d3cd8466aa0","block_type":"box","text":"brokers by mutual fund management personnel, or personnel principally responsible for BlackRock’s individually","page_number":169,"box":{"x":69,"y":702,"width":798,"height":12}},{"id":"1ad080c3-2a4d-4a36-bdbf-d240f869ba92","block_type":"box","text":"managed por tfolios, is not necessarily shared by and between such personnel. Any investment advisory or other fees","page_number":169,"box":{"x":69,"y":717,"width":836,"height":12}},{"id":"c439a6ed-25f0-4387-bc8e-39a023c89b72","block_type":"box","text":"paid by a Fund to BlackRock are not reduced as a result of BlackRock’s receipt of research services. In some cases,","page_number":169,"box":{"x":70,"y":732,"width":832,"height":12}},{"id":"30deaa98-ad40-4439-923a-055daa4e6180","block_type":"box","text":"BlackRock may receive a service from a broker that has both a “research” and a “non-research” use. When this","page_number":169,"box":{"x":70,"y":748,"width":798,"height":11}},{"id":"d9b7e0b2-840e-4e08-82d8-37055f6057a7","block_type":"box","text":"occurs BlackRock makes a good faith allocation, under all the circumstances, between the research and non","page_number":169,"box":{"x":69,"y":763,"width":780,"height":11}},{"id":"47236ae5-cfbe-44e9-b164-8ea7c44a7be1","block_type":"box","text":"research uses of the service. The percentage of the service that is used for research purposes may be paid for with","page_number":169,"box":{"x":69,"y":778,"width":827,"height":11}},{"id":"a8e044f7-fcda-4005-9c52-1ab7032c2cc5","block_type":"box","text":"client commissions, while BlackRock will use its own funds to pay for the percentage of the service that is used for","page_number":169,"box":{"x":69,"y":793,"width":821,"height":11}},{"id":"ced4d15a-d206-4f5a-aba5-7291e40720df","block_type":"box","text":"non-research purposes. In making this good faith allocation, BlackRock faces a potential conflict of interest, but","page_number":169,"box":{"x":69,"y":808,"width":797,"height":11}},{"id":"4ae2eb49-b504-4ed1-a35b-c46ec2984d93","block_type":"box","text":"BlackRock believes that its allocation procedures are reasonably designed to ensure that it appropriately allocates","page_number":169,"box":{"x":70,"y":823,"width":815,"height":12}},{"id":"033b7403-b21c-4907-b3b8-7e121b85b9f5","block_type":"box","text":"the anticipated use of such services to their research and non-research uses.","page_number":169,"box":{"x":68,"y":838,"width":555,"height":11}},{"id":"680fb3cc-15cb-43cd-a09c-34dbd9c03909","block_type":"box","text":"Under MiFID II, investment managers in the EU, including BIL, are not able to use soft dollars to pay for research","page_number":169,"box":{"x":102,"y":861,"width":802,"height":11}},{"id":"04b04c50-0989-4b7b-8fe3-96798087bffb","block_type":"box","text":"from brokers. Investment managers in the EU are required to either pay for research out of their own profit and loss","page_number":169,"box":{"x":68,"y":876,"width":825,"height":11}},{"id":"3d603ee1-e3e4-4611-a641-a008a5cdffd0","block_type":"box","text":"or agree with clients to have research costs paid by clients through research payment accounts that are directly","page_number":169,"box":{"x":69,"y":891,"width":798,"height":12}},{"id":"2a7ada25-c9bd-4f21-8a4b-db9fb4f80c8c","block_type":"box","text":"funded or funded by a specific client research charge collected alongside execution commissions, provided that the","page_number":169,"box":{"x":68,"y":906,"width":824,"height":12}},{"id":"52080287-06ab-4fb3-9b71-b59f54b44920","block_type":"box","text":"II-125","page_number":169,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"8fc71cc7-fba8-4da0-b1cb-3fb8a3d6ddd2","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":169,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"1a1f3cf9-a894-418d-9007-a5224de27da6","block_type":"box","text":"payments for research are unbundled from the payments for execution. BIL will pay for any research out of its own","page_number":170,"box":{"x":70,"y":45,"width":812,"height":11}},{"id":"fb12b9c5-634f-41ab-9a5f-b8e067d613f2","block_type":"box","text":"resources and not through soft dollars or commission sharing arrangements.","page_number":170,"box":{"x":69,"y":60,"width":547,"height":11}},{"id":"f1437d54-487a-4b48-819f-d01a2c39532b","block_type":"box","text":"Payments of commissions to brokers who are affiliated persons of the Fund, or the Master Por tfolio with respect","page_number":170,"box":{"x":102,"y":82,"width":804,"height":12}},{"id":"2acdf073-dde2-45ec-a652-53142bf6392a","block_type":"box","text":"to the Feeder Fund (or affiliated persons of such persons), will be made in accordance with Rule 17e-1 under the","page_number":170,"box":{"x":68,"y":98,"width":806,"height":11}},{"id":"f7e5fb4f-16f7-4df5-9c20-f7c4d3f2d8b0","block_type":"box","text":"Investment Company Act. Subject to policies established by the Board of Directors of the Master Por tfolio, BlackRock","page_number":170,"box":{"x":70,"y":113,"width":836,"height":11}},{"id":"9451d0b7-3076-44f4-8d49-65aee13e891a","block_type":"box","text":"is primarily responsible for the execution of the Master Por tfolio’s por tfolio transactions and the allocation of","page_number":170,"box":{"x":70,"y":128,"width":777,"height":11}},{"id":"47827651-27b8-4de2-8380-0341c2a79fd3","block_type":"box","text":"brokerage.","page_number":170,"box":{"x":69,"y":143,"width":74,"height":11}},{"id":"9712b6e7-83da-4129-8697-aa6bd1a0c4c9","block_type":"box","text":"From time to time, a Fund may purchase new issues of securities in a fixed price offering. In these situations,","page_number":170,"box":{"x":102,"y":166,"width":781,"height":11}},{"id":"4f79125b-7269-46e3-8c2f-5d3d3f8ac065","block_type":"box","text":"the broker may be a member of the selling group that will, in addition to selling securities, provide BlackRock with","page_number":170,"box":{"x":68,"y":181,"width":810,"height":11}},{"id":"33fe3c35-c5e3-4578-8cb9-7b5ec8f60bd3","block_type":"box","text":"research services. FINRA has adopted rules expressly permitting these types of arrangements under cer tain","page_number":170,"box":{"x":69,"y":196,"width":771,"height":11}},{"id":"169cb394-621b-431f-8ad7-70a23dc13ca0","block_type":"box","text":"circumstances. Generally, the broker will provide research “credits” in these situations at a rate that is higher than","page_number":170,"box":{"x":69,"y":211,"width":818,"height":11}},{"id":"db07ddb2-04b4-45c8-9a03-d782a237c4c3","block_type":"box","text":"that available for typical secondary market transactions. These arrangements may not fall within the safe harbor of","page_number":170,"box":{"x":68,"y":226,"width":821,"height":11}},{"id":"1577147f-581c-41d2-974f-425737968323","block_type":"box","text":"Section 28(e).","page_number":170,"box":{"x":69,"y":241,"width":99,"height":11}},{"id":"ced6dfc0-5de5-433d-b333-b7de8e3ebc1b","block_type":"box","text":"BlackRock does not consider sales of shares of the mutual funds it advises as a factor in the selection of","page_number":170,"box":{"x":102,"y":264,"width":755,"height":9}},{"id":"87899698-0840-40ec-9e2e-eef1e031d2ed","block_type":"box","text":"brokers or dealers to execute por tfolio transactions for a Fund; however, whether or not a par ticular broker or dealer","page_number":170,"box":{"x":69,"y":279,"width":828,"height":11}},{"id":"3d8dd073-3f89-4366-b07e-e9d404086bf4","block_type":"box","text":"sells shares of the mutual funds advised by BlackRock neither qualifies nor disqualifies such broker or dealer to","page_number":170,"box":{"x":69,"y":294,"width":799,"height":11}},{"id":"4e90095a-38b2-43be-b200-ad5776116c36","block_type":"box","text":"execute transactions for those mutual funds.","page_number":170,"box":{"x":69,"y":309,"width":319,"height":9}},{"id":"b42aaf8f-a127-44fa-9fd1-80868cae529f","block_type":"box","text":"Each Fund anticipates that its brokerage transactions involving foreign securities generally will be conducted","page_number":170,"box":{"x":102,"y":332,"width":770,"height":11}},{"id":"d7ef5d06-06db-46ee-88c7-1444c4ace8d5","block_type":"box","text":"primarily on the principal stock exchanges of the applicable country. Foreign equity securities may be held by a Fund","page_number":170,"box":{"x":70,"y":347,"width":825,"height":11}},{"id":"8c33a87b-323a-4d77-9122-fdc814343cfd","block_type":"box","text":"in the form of depositary receipts, or other securities conver tible into foreign equity securities. Depositary receipts","page_number":170,"box":{"x":70,"y":362,"width":816,"height":11}},{"id":"d2f91fb4-6c49-4426-a984-8c78db363849","block_type":"box","text":"may be listed on stock exchanges, or traded in OTC markets in the United States or Europe, as the case may be.","page_number":170,"box":{"x":69,"y":377,"width":805,"height":12}},{"id":"6c6adb69-a58f-495e-a651-154efb5c0bee","block_type":"box","text":"American Depositary Receipts, like other securities traded in the United States, will be subject to negotiated","page_number":170,"box":{"x":68,"y":392,"width":773,"height":12}},{"id":"a58a8683-dc61-4b9e-9eb6-df7010a41d0d","block_type":"box","text":"commission rates. Because the shares of each Fund are redeemable on a daily basis in U.S. dollars, each Fund","page_number":170,"box":{"x":69,"y":407,"width":798,"height":12}},{"id":"5aa1c885-173c-47f2-b634-00c5c8d26dc8","block_type":"box","text":"intends to manage its por tfolio so as to give reasonable assurance that it will be able to obtain U.S. dollars to the","page_number":170,"box":{"x":70,"y":423,"width":812,"height":11}},{"id":"7e749bec-d5f6-4c80-b44b-fe3f200c6fec","block_type":"box","text":"extent necessary to meet anticipated redemptions. Under present conditions, it is not believed that these","page_number":170,"box":{"x":69,"y":438,"width":754,"height":11}},{"id":"9fcab961-c06d-478c-a1fa-77b6dc1d0834","block_type":"box","text":"considerations will have a significant effect on a Fund’s por tfolio strategies.","page_number":170,"box":{"x":69,"y":453,"width":540,"height":11}},{"id":"cce0e0dd-32c2-4cf9-8509-fbcfb9af8677","block_type":"box","text":"See “Por tfolio Transactions and Brokerage” in the SAI for information about the brokerage commissions paid by","page_number":170,"box":{"x":102,"y":475,"width":798,"height":12}},{"id":"57c9e42c-cf0b-4965-b4e6-964b4f4e3ffc","block_type":"box","text":"your Fund, including commissions paid to affiliates, if any, for the periods indicated.","page_number":170,"box":{"x":68,"y":491,"width":597,"height":11}},{"id":"3d6d4ba0-d247-42ed-a378-bea92494a0c0","block_type":"box","text":"Each Fund may invest in cer tain securities traded in the OTC market and intends to deal directly with the dealers","page_number":170,"box":{"x":102,"y":513,"width":802,"height":11}},{"id":"2078f62f-bd18-4bea-be9c-d444a5713207","block_type":"box","text":"who make a market in the par ticular securities, except in those circumstances in which better prices and execution","page_number":170,"box":{"x":68,"y":529,"width":822,"height":10}},{"id":"ba62bc93-e277-4796-b759-5a23e9052655","block_type":"box","text":"are available elsewhere. Under the Investment Company Act, persons affiliated with a Fund and persons who are","page_number":170,"box":{"x":69,"y":543,"width":804,"height":12}},{"id":"e894a850-a3c3-4ee0-a828-b4dba136d5d1","block_type":"box","text":"affiliated with such affiliated persons are prohibited from dealing with the Fund as principal in the purchase and sale","page_number":170,"box":{"x":69,"y":559,"width":832,"height":11}},{"id":"595da122-ca9d-4de9-bbed-9283848495d4","block_type":"box","text":"of securities unless a permissive order allowing such transactions is obtained from the Commission. Since","page_number":170,"box":{"x":69,"y":574,"width":762,"height":11}},{"id":"01fcf558-f656-4dd8-a1bc-ed578d5e42f6","block_type":"box","text":"transactions in the OTC market usually involve transactions with the dealers acting as principal for their own","page_number":170,"box":{"x":68,"y":589,"width":770,"height":11}},{"id":"38c231f5-ad90-465b-9682-b7d40a5bd2ec","block_type":"box","text":"accounts, the Funds will not deal with affiliated persons in connection with such transactions. However, an affiliated","page_number":170,"box":{"x":69,"y":604,"width":828,"height":11}},{"id":"e5b19eeb-f042-4e55-8238-33733d04e449","block_type":"box","text":"person of a Fund may serve as its broker in OTC transactions conducted on an agency basis provided that, among","page_number":170,"box":{"x":70,"y":619,"width":814,"height":11}},{"id":"b1b71d29-426d-4132-9f94-bc5469117c8f","block_type":"box","text":"other things, the fee or commission received by such affiliated broker is reasonable and fair compared to the fee or","page_number":170,"box":{"x":69,"y":634,"width":825,"height":12}},{"id":"9800c6bf-9db2-4c82-9a16-666001e34446","block_type":"box","text":"commission received by non-affiliated brokers in connection with comparable transactions.","page_number":170,"box":{"x":69,"y":649,"width":645,"height":12}},{"id":"3fc623bf-714c-4e2c-a4ea-045bac4a9a27","block_type":"box","text":"OTC issues, including most fixed-income securities such as corporate debt and U.S. Government Securities, are","page_number":170,"box":{"x":102,"y":672,"width":797,"height":11}},{"id":"09f237e1-2ad9-4647-9d70-d7b1faf3e147","block_type":"box","text":"normally traded on a “net” basis without a stated commission, through dealers acting for their own account and not","page_number":170,"box":{"x":69,"y":687,"width":826,"height":11}},{"id":"cf4971dd-acb2-4d25-b286-c0d239c63bfe","block_type":"box","text":"as brokers. The Funds will primarily engage in transactions with these dealers or deal directly with the issuer unless a","page_number":170,"box":{"x":69,"y":703,"width":839,"height":11}},{"id":"2d86fbbe-f5f4-4333-9c89-52a2f2065277","block_type":"box","text":"better price or execution could be obtained by using a broker. Prices paid to a dealer with respect to both foreign and","page_number":170,"box":{"x":69,"y":717,"width":833,"height":12}},{"id":"6a61596a-5ae2-48e2-aa50-ef78fcda41f3","block_type":"box","text":"domestic securities will generally include a “spread,” which is the difference between the prices at which the dealer","page_number":170,"box":{"x":69,"y":732,"width":826,"height":12}},{"id":"9cb3b37a-c57b-49fa-91e9-737c12d5886d","block_type":"box","text":"is willing to purchase and sell the specific security at the time, and includes the dealer’s normal profit.","page_number":170,"box":{"x":70,"y":748,"width":730,"height":11}},{"id":"6d5bea52-cd22-4cba-b9c0-4923cf1c761c","block_type":"box","text":"Purchases of money market instruments by a Fund are made from dealers, underwriters and issuers. The Funds","page_number":170,"box":{"x":102,"y":770,"width":800,"height":11}},{"id":"bbfd0678-8c95-4d46-ae99-86867c5191bb","block_type":"box","text":"do not currently expect to incur any brokerage commission expense on such transactions because money market","page_number":170,"box":{"x":69,"y":786,"width":807,"height":11}},{"id":"1c83a343-33d0-42c0-a894-141147284032","block_type":"box","text":"instruments are generally traded on a “net” basis with dealers acting as principal for their own accounts without a","page_number":170,"box":{"x":70,"y":801,"width":812,"height":11}},{"id":"0bd8e955-47f0-42a1-89a2-faebe298b9a1","block_type":"box","text":"stated commission. The price of the security, however, usually includes a profit to the dealer. Each money market","page_number":170,"box":{"x":69,"y":816,"width":807,"height":11}},{"id":"c6107baa-8494-4b0a-9c24-1a1bb95fe9db","block_type":"box","text":"fund intends to purchase only securities with remaining maturities of 397 days or less as determined in accordance","page_number":170,"box":{"x":68,"y":831,"width":827,"height":11}},{"id":"d3f69abd-fcf6-4649-8f18-bc3655f10cc5","block_type":"box","text":"with the rules of the Commission. As a result, the por tfolio turnover rates of a money market fund will be relatively","page_number":170,"box":{"x":68,"y":846,"width":817,"height":11}},{"id":"84a4e7fc-3904-4b83-91c6-caa7cbfd28da","block_type":"box","text":"high. However, because brokerage commissions will not normally be paid with respect to investments made by a","page_number":170,"box":{"x":69,"y":861,"width":802,"height":11}},{"id":"61cdca68-5d1b-4548-8738-03a6733e9ca8","block_type":"box","text":"money market fund, the turnover rates should not adversely affect the Fund’s NAVs or net income.","page_number":170,"box":{"x":69,"y":876,"width":700,"height":11}},{"id":"c4732ca1-580a-4bf2-b59d-7dafbb2981b0","block_type":"box","text":"II-126","page_number":170,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"584b5269-7604-4e59-8941-a72d3263b0d2","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":170,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"6bdda137-5736-470c-aae7-85b278ffafae","block_type":"box","text":"Securities purchased in underwritten offerings include a fixed amount of compensation to the underwriter,","page_number":171,"box":{"x":102,"y":45,"width":756,"height":11}},{"id":"37776a42-cc61-4fbf-be17-02f4e5809104","block_type":"box","text":"generally referred to as the underwriter’s concession or discount. When offered securities are purchased or sold","page_number":171,"box":{"x":68,"y":60,"width":804,"height":11}},{"id":"93b9deab-7421-47ea-a0a5-ba735596ff10","block_type":"box","text":"directly from or to an issuer, no commissions or discounts are paid except where required by local markets.","page_number":171,"box":{"x":69,"y":75,"width":766,"height":11}},{"id":"2e4bd29a-4a5d-4b77-8b33-60a2f8236b7e","block_type":"box","text":"The Manager or sub-advisers may seek to obtain an under taking from issuers of commercial paper or dealers","page_number":171,"box":{"x":101,"y":98,"width":780,"height":11}},{"id":"b099f096-d507-4b8a-80f5-4783e580bab0","block_type":"box","text":"selling commercial paper to consider the repurchase of such securities from a Fund prior to maturity at their original","page_number":171,"box":{"x":69,"y":113,"width":826,"height":11}},{"id":"f8d89044-14af-4420-86c3-d41655bb21eb","block_type":"box","text":"cost plus interest (sometimes adjusted to reflect the actual maturity of the securities), if it believes that a Fund’s","page_number":171,"box":{"x":69,"y":128,"width":806,"height":11}},{"id":"9f43ffeb-d648-44cb-be59-4a168f4583f9","block_type":"box","text":"anticipated need for liquidity makes such action desirable. Any such repurchase prior to maturity reduces the","page_number":171,"box":{"x":69,"y":143,"width":776,"height":11}},{"id":"1b9221d6-7406-4bfe-8068-0c01e53e722e","block_type":"box","text":"possibility that a Fund would incur a capital loss in liquidating commercial paper, especially if interest rates have","page_number":171,"box":{"x":70,"y":158,"width":800,"height":11}},{"id":"c0cb5ffb-4a79-4b69-aca6-33388204d9c5","block_type":"box","text":"risen since acquisition of such commercial paper.","page_number":171,"box":{"x":69,"y":173,"width":352,"height":11}},{"id":"b6930eba-4411-45b4-b215-227eb4c681d3","block_type":"box","text":"Investment decisions for each Fund and for other investment accounts managed by the Manager or sub-advisers","page_number":171,"box":{"x":102,"y":196,"width":800,"height":11}},{"id":"d83b3ede-0b05-4e38-b36c-9f214f8b51e6","block_type":"box","text":"are made independently of each other in light of differing conditions. BlackRock allocates investments among client","page_number":171,"box":{"x":69,"y":211,"width":824,"height":11}},{"id":"d0c25c02-a3e8-4678-a34b-5f5ffe23e844","block_type":"box","text":"accounts in a fair and equitable manner over time. A variety of factors will be considered in making such allocations.","page_number":171,"box":{"x":69,"y":226,"width":828,"height":11}},{"id":"5fab3a6b-d8ac-4440-a68e-8c70ac40c526","block_type":"box","text":"These factors include: (i) investment objectives or strategies for par ticular accounts, including sector, industry,","page_number":171,"box":{"x":68,"y":241,"width":788,"height":11}},{"id":"2c206ce3-a7ba-44e7-bf55-3659b21a456d","block_type":"box","text":"country or region and capitalization weightings, (ii) tax considerations of an account, (iii) risk or investment","page_number":171,"box":{"x":69,"y":256,"width":759,"height":12}},{"id":"0e798a91-83e6-452d-aed6-bfc77667f91e","block_type":"box","text":"concentration parameters for an account, (iv) supply or demand for a security at a given price level, (v) size of","page_number":171,"box":{"x":69,"y":271,"width":780,"height":12}},{"id":"5f081aaf-76f8-4c31-8f13-f69a3656d56d","block_type":"box","text":"available investment, (vi) cash availability and liquidity requirements for accounts, (vii) regulatory restrictions,","page_number":171,"box":{"x":69,"y":286,"width":777,"height":12}},{"id":"7509e0e8-a892-411c-8cc1-fee9503209fd","block_type":"box","text":"(viii) minimum investment size of an account, (ix) relative size of account, and (x) such other factors as may be","page_number":171,"box":{"x":69,"y":302,"width":788,"height":11}},{"id":"af29a93e-d2e6-4211-af3c-0789bdf72da7","block_type":"box","text":"approved by BlackRock’s general counsel. Moreover, investments may not be allocated to one client account over","page_number":171,"box":{"x":69,"y":317,"width":811,"height":11}},{"id":"3a106370-4596-4e10-8157-d88531d8602a","block_type":"box","text":"another based on any of the following considerations: (i) to favor one client account at the expense of another, (ii) to","page_number":171,"box":{"x":69,"y":332,"width":829,"height":11}},{"id":"1195dfef-adfe-41db-a55a-a64e897a2fac","block_type":"box","text":"generate higher fees paid by one client account over another or to produce greater per formance compensation to","page_number":171,"box":{"x":68,"y":347,"width":808,"height":11}},{"id":"59c80a96-c339-449e-9edf-59e114949da5","block_type":"box","text":"BlackRock, (iii) to develop or enhance a relationship with a client or prospective client, (iv) to compensate a client for","page_number":171,"box":{"x":70,"y":362,"width":832,"height":11}},{"id":"2b6dc215-d1b1-49be-b168-5c22fb0e78b5","block_type":"box","text":"past services or benefits rendered to BlackRock or to induce future services or benefits to be rendered to BlackRock,","page_number":171,"box":{"x":70,"y":377,"width":836,"height":11}},{"id":"8a028929-01c8-46e4-8f6a-eb22b5e30608","block_type":"box","text":"or (v) to manage or equalize investment per formance among different client accounts.","page_number":171,"box":{"x":69,"y":392,"width":613,"height":12}},{"id":"80516ea1-87f8-4c3d-a45b-f618ff17deb9","block_type":"box","text":"Equity securities will generally be allocated among client accounts within the same investment mandate on a pro","page_number":171,"box":{"x":102,"y":415,"width":802,"height":11}},{"id":"4f9cce78-3553-4214-9dbb-32d5635838e0","block_type":"box","text":"rata basis. All allocations of equity securities will be subject, where relevant, to share minimums established for","page_number":171,"box":{"x":69,"y":430,"width":800,"height":11}},{"id":"31488e64-41e4-485e-8330-90603c11e1e1","block_type":"box","text":"accounts and compliance constraints.","page_number":171,"box":{"x":69,"y":446,"width":269,"height":10}},{"id":"517c363c-a88a-41a2-9612-5a1adab4481d","block_type":"box","text":"Initial public offerings of securities may be over-subscribed and subsequently trade at a premium in the","page_number":171,"box":{"x":102,"y":468,"width":736,"height":11}},{"id":"ddc5fb41-72a5-4933-89a0-bada4362f4cc","block_type":"box","text":"secondary market. In these situations, the supply of securities available for client accounts is often less than the","page_number":171,"box":{"x":69,"y":483,"width":808,"height":11}},{"id":"b160e7fb-c18c-4fce-9a9a-af97f148bc62","block_type":"box","text":"amount of securities the accounts would otherwise take. In order to allocate these investments fairly and equitably","page_number":171,"box":{"x":69,"y":498,"width":821,"height":11}},{"id":"0bb24e95-a29d-4c32-94cc-0afdb175dc68","block_type":"box","text":"among client accounts over time, each por tfolio manager or a member of his or her respective investment team will","page_number":171,"box":{"x":69,"y":513,"width":823,"height":12}},{"id":"ca557a87-188f-4c3f-8864-3b028349370d","block_type":"box","text":"indicate to BlackRock’s trading desk their level of interest in a par ticular offering with respect to eligible client","page_number":171,"box":{"x":70,"y":528,"width":783,"height":12}},{"id":"b7bdf5df-ea97-45ac-8cd3-fbf2af81a117","block_type":"box","text":"accounts for which that team is responsible. Initial public offerings of U.S. equity securities will be identified as","page_number":171,"box":{"x":69,"y":543,"width":793,"height":12}},{"id":"243d0e9c-c7dd-41f4-b057-94b8f1cb04ec","block_type":"box","text":"eligible for par ticular client accounts that are managed by por tfolio teams who have indicated interest in the offering","page_number":171,"box":{"x":69,"y":559,"width":831,"height":11}},{"id":"ce10e9ee-518a-465b-81a4-b4927b10a4fe","block_type":"box","text":"based on market capitalization of the issuer of the security and the investment mandate of the client account and in","page_number":171,"box":{"x":69,"y":574,"width":828,"height":11}},{"id":"74fb77d5-bd91-4c05-8591-14ee13d52908","block_type":"box","text":"the case of international equity securities, the country where the offering is taking place and the investment mandate","page_number":171,"box":{"x":68,"y":589,"width":839,"height":11}},{"id":"8c9f7bcb-f97a-4a35-978d-0d949751e38b","block_type":"box","text":"of the client account. Generally, shares received during the initial public offering will be allocated among par ticipating","page_number":171,"box":{"x":69,"y":604,"width":835,"height":11}},{"id":"95eade84-7bc6-4d83-8290-4da7c28f3f9d","block_type":"box","text":"client accounts within each investment mandate on a pro rata basis. In situations where supply is too limited to be","page_number":171,"box":{"x":69,"y":619,"width":819,"height":11}},{"id":"55229d19-3013-4251-abb2-f87af36a72a7","block_type":"box","text":"allocated among all accounts for which the investment is eligible, por tfolio managers may rotate such investment","page_number":171,"box":{"x":69,"y":634,"width":808,"height":12}},{"id":"7236a070-6cc9-4e94-a419-e3c4083d47a4","block_type":"box","text":"oppor tunities among one or more accounts so long as the rotation system provides for fair access for all client","page_number":171,"box":{"x":69,"y":649,"width":791,"height":12}},{"id":"c5330f1d-e147-47aa-80e2-5d93ab037d5b","block_type":"box","text":"accounts over time. Other allocation methodologies that are considered by BlackRock to be fair and equitable to","page_number":171,"box":{"x":69,"y":664,"width":799,"height":12}},{"id":"5c3dbe90-990b-447d-b55b-83285367739e","block_type":"box","text":"clients may be used as well.","page_number":171,"box":{"x":69,"y":680,"width":200,"height":11}},{"id":"fa11232f-17dd-4b07-a181-ae560c15680e","block_type":"box","text":"Because different accounts may have differing investment objectives and policies, BlackRock may buy and sell","page_number":171,"box":{"x":102,"y":702,"width":789,"height":12}},{"id":"e8968e2d-0b2a-43aa-b15f-50f4adad6790","block_type":"box","text":"the same securities at the same time for different clients based on the par ticular investment objective, guidelines","page_number":171,"box":{"x":68,"y":717,"width":815,"height":12}},{"id":"dfdeb058-1a30-46b3-b73a-558753f8f8b9","block_type":"box","text":"and strategies of those accounts. For example, BlackRock may decide that it may be entirely appropriate for a growth","page_number":171,"box":{"x":69,"y":732,"width":835,"height":12}},{"id":"b46be6ec-7cd0-4fc1-b307-4bed158f456f","block_type":"box","text":"fund to sell a security at the same time a value fund is buying that security. To the extent that transactions on behalf","page_number":171,"box":{"x":68,"y":748,"width":833,"height":11}},{"id":"4c087089-a49b-46e0-9796-11338fa8663b","block_type":"box","text":"of more than one client of BlackRock or its affiliates during the same period may increase the demand for securities","page_number":171,"box":{"x":69,"y":763,"width":829,"height":11}},{"id":"c5033bba-a49f-4a38-9335-59f38d097898","block_type":"box","text":"being purchased or the supply of securities being sold, there may be an adverse effect on price. For example, sales","page_number":171,"box":{"x":69,"y":778,"width":825,"height":11}},{"id":"cd4640b7-ed5d-4c59-8453-3033b1ea3a5d","block_type":"box","text":"of a security by BlackRock on behalf of one or more of its clients may decrease the market price of such security,","page_number":171,"box":{"x":69,"y":793,"width":806,"height":11}},{"id":"c69201f0-0734-4510-b4a9-474aeec114db","block_type":"box","text":"adversely impacting other BlackRock clients that still hold the security. If purchases or sales of securities arise for","page_number":171,"box":{"x":69,"y":808,"width":814,"height":11}},{"id":"9cb167f0-07aa-4166-8d01-f079e9d1382e","block_type":"box","text":"consideration at or about the same time that would involve a Fund or other clients or funds for which BlackRock or an","page_number":171,"box":{"x":69,"y":823,"width":836,"height":9}},{"id":"362d1224-990b-4b3c-a5f4-91bad4b940a6","block_type":"box","text":"affiliate act as investment manager, transactions in such securities will be made, insofar as feasible, for the","page_number":171,"box":{"x":69,"y":838,"width":773,"height":12}},{"id":"ee92b39b-dfa2-4422-9f52-6bd9339e7718","block_type":"box","text":"respective funds and clients in a manner deemed equitable to all.","page_number":171,"box":{"x":69,"y":853,"width":467,"height":11}},{"id":"f6e10dd9-33c7-45e3-b834-64dfca65734d","block_type":"box","text":"In cer tain instances, BlackRock may find it efficient for purposes of seeking to obtain best execution, to","page_number":171,"box":{"x":102,"y":876,"width":741,"height":11}},{"id":"e2e8961b-432b-41ed-841e-373e7ce43899","block_type":"box","text":"aggregate cer tain contemporaneous purchases or sale orders of its advisory accounts. In general, all","page_number":171,"box":{"x":69,"y":891,"width":721,"height":12}},{"id":"688cda8e-af34-4ac4-9490-6e0b554ebbbe","block_type":"box","text":"contemporaneous trades for client accounts under management by the same por tfolio manager or investment team","page_number":171,"box":{"x":69,"y":906,"width":824,"height":12}},{"id":"d17d3d1a-3ce0-449f-9293-bff639b4a783","block_type":"box","text":"II-127","page_number":171,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"3ca9223c-d89c-40b3-8fdd-c29a2c617e27","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":171,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"4c09862c-0f1a-4499-9979-72a7f5d58412","block_type":"box","text":"will be aggregated in a single order if the trader believes the aggregated trade would provide each client with an","page_number":172,"box":{"x":68,"y":45,"width":795,"height":11}},{"id":"99f4e35b-f99f-41c7-9a5a-ee1fa45eaf7b","block_type":"box","text":"oppor tunity to achieve a more favorable execution at a potentially lower execution cost. The costs associated with an","page_number":172,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"4c1b2aab-9289-4fd5-898b-6d9451405d44","block_type":"box","text":"aggregated order will be shared pro rata among the clients in the aggregated order. Generally, if an order for a","page_number":172,"box":{"x":69,"y":75,"width":783,"height":11}},{"id":"e310f00d-6475-4ce1-b26b-70094a314b1b","block_type":"box","text":"par ticular por tfolio manager or management team is filled at several different prices through multiple trades, all","page_number":172,"box":{"x":70,"y":90,"width":796,"height":11}},{"id":"88e97e2e-84d7-4a79-8eb6-a1fa40fecfdd","block_type":"box","text":"accounts par ticipating in the order will receive the average price except in the case of cer tain international markets","page_number":172,"box":{"x":69,"y":105,"width":821,"height":11}},{"id":"0cbadaba-4af7-4a94-9f72-6249f4ccafa0","block_type":"box","text":"where average pricing is not permitted. While in some cases this practice could have a detrimental effect upon the","page_number":172,"box":{"x":68,"y":120,"width":819,"height":12}},{"id":"44c32637-fad8-43df-861c-bcc5fbe8ef1c","block_type":"box","text":"price or value of the security as far as a Fund is concerned, in other cases it could be beneficial to the Fund.","page_number":172,"box":{"x":70,"y":135,"width":771,"height":11}},{"id":"638f52c5-509f-4813-bc46-4ca5d77f9d83","block_type":"box","text":"Transactions effected by BlackRock on behalf of more than one of its clients during the same period may increase","page_number":172,"box":{"x":68,"y":150,"width":815,"height":12}},{"id":"8060a91e-bcee-4370-bb69-75de63ec6c19","block_type":"box","text":"the demand for securities being purchased or the supply of securities being sold, causing an adverse effect on price.","page_number":172,"box":{"x":68,"y":166,"width":835,"height":11}},{"id":"1ddabc0d-5ba6-4843-bd2f-c3d4582b38cb","block_type":"box","text":"The trader will give the aggregated order to the broker-dealer that the trader has identified as being able to provide","page_number":172,"box":{"x":68,"y":181,"width":817,"height":11}},{"id":"39e7c2b1-2f5d-4dee-8416-9c4e08eb09d6","block_type":"box","text":"the best execution of the order. Orders for purchase or sale of securities will be placed within a reasonable amount","page_number":172,"box":{"x":68,"y":196,"width":823,"height":11}},{"id":"df77435c-c046-44fa-aa27-d58cf114a8b9","block_type":"box","text":"of time of the order receipt and aggregated orders will be kept aggregated only long enough to execute the order.","page_number":172,"box":{"x":69,"y":211,"width":803,"height":11}},{"id":"c352b5e5-bacc-440a-bc6d-ebf3efab95e8","block_type":"box","text":"A Fund will not purchase securities during the existence of any underwriting or selling group relating to such","page_number":172,"box":{"x":101,"y":234,"width":767,"height":11}},{"id":"b0fc31cc-29cf-4b24-b389-fa0c046ad47f","block_type":"box","text":"securities of which BlackRock, BRIL or any affiliated person (as defined in the Investment Company Act) thereof is a","page_number":172,"box":{"x":69,"y":249,"width":826,"height":11}},{"id":"6038897a-f3ad-453c-9797-cc93fa603eda","block_type":"box","text":"member except pursuant to procedures adopted by the Board of Directors in accordance with Rule 10f-3 under the","page_number":172,"box":{"x":69,"y":264,"width":816,"height":11}},{"id":"2036325e-a154-455c-9ec0-ed2365f6d99a","block_type":"box","text":"Investment Company Act. In no instance will por tfolio securities be purchased from or sold to BlackRock, BRIL or any","page_number":172,"box":{"x":70,"y":279,"width":833,"height":11}},{"id":"c45aed81-cd73-4f62-aab5-90affbfbe0ff","block_type":"box","text":"affiliated person of the foregoing entities except as permitted by Commission exemptive order or by applicable law.","page_number":172,"box":{"x":69,"y":294,"width":818,"height":11}},{"id":"82a60412-4041-4f44-afd5-c6384f9a1393","block_type":"box","text":"A Fund’s purchase and sale orders for securities may be combined with those of other investment companies,","page_number":172,"box":{"x":101,"y":317,"width":786,"height":11}},{"id":"deca2389-13ac-47aa-b25d-c062fc1287cd","block_type":"box","text":"clients or accounts that BlackRock manages or advises. If purchases or sales of por tfolio securities of a Fund and","page_number":172,"box":{"x":69,"y":332,"width":814,"height":11}},{"id":"a979f599-c3cf-4c13-8f9b-36b72e0ca42a","block_type":"box","text":"one or more other accounts managed or advised by BlackRock are considered at or about the same time,","page_number":172,"box":{"x":69,"y":347,"width":751,"height":11}},{"id":"4bb5d3c2-daed-4fac-b9be-5697e630568e","block_type":"box","text":"transactions in such securities are allocated among the Fund and the other accounts in a manner deemed equitable","page_number":172,"box":{"x":68,"y":362,"width":829,"height":11}},{"id":"d5e98d04-8de0-44ce-a526-28f003801c2a","block_type":"box","text":"to all by BlackRock. In some cases, this procedure could have a detrimental effect on the price or volume of the","page_number":172,"box":{"x":68,"y":377,"width":799,"height":11}},{"id":"57531889-c6df-44b3-8039-a28259d7f3c4","block_type":"box","text":"security as far as a Fund is concerned. However, in other cases, it is possible that the ability to par ticipate in volume","page_number":172,"box":{"x":69,"y":392,"width":834,"height":12}},{"id":"706ffc90-83bd-4589-abec-bf66be06c782","block_type":"box","text":"transactions and to negotiate lower transaction costs will be beneficial to the Fund. BlackRock may deal, trade and","page_number":172,"box":{"x":68,"y":407,"width":820,"height":12}},{"id":"3e4df989-f26f-4216-b3ed-49a6f4f2e70a","block_type":"box","text":"invest for its own account in the types of securities in which a Fund may invest. BlackRock may, from time to time,","page_number":172,"box":{"x":70,"y":423,"width":812,"height":11}},{"id":"05254b33-73d1-4947-b0d1-81234f2f9f78","block_type":"box","text":"effect trades on behalf of and for the account of a Fund with brokers or dealers that are affiliated with BFA, in","page_number":172,"box":{"x":69,"y":438,"width":781,"height":10}},{"id":"2658e77f-1555-4266-ac8e-38c85b3c4e4a","block_type":"box","text":"conformity with the Investment Company Act and Commission rules and regulations. Under these provisions, any","page_number":172,"box":{"x":69,"y":453,"width":805,"height":11}},{"id":"dd0af3bb-bbfe-48f3-a596-1eef9fb5040e","block_type":"box","text":"commissions paid to affiliated brokers or dealers must be reasonable and fair compared to the commissions charged","page_number":172,"box":{"x":69,"y":468,"width":840,"height":11}},{"id":"6a0521e7-73bb-4912-b239-27a055f1a1b1","block_type":"box","text":"by other brokers or dealers in comparable transactions. A Fund will not deal with affiliates in principal transactions","page_number":172,"box":{"x":69,"y":483,"width":815,"height":11}},{"id":"8e764fd2-5b4b-4da3-ab9e-648205c4e9ae","block_type":"box","text":"unless permitted by applicable Commission rules or regulations, or by Commission exemptive order.","page_number":172,"box":{"x":69,"y":498,"width":713,"height":11}},{"id":"89674cac-9548-4064-a227-4f96e00560dc","block_type":"box","text":"Portfolio Turnover","page_number":172,"box":{"x":69,"y":528,"width":129,"height":9}},{"id":"2af3ecfa-c925-45a8-aa2a-e2e805bf7aa9","block_type":"box","text":"The por tfolio turnover rate is calculated by dividing the lesser of a Fund’s annual sales or purchases of por tfolio","page_number":172,"box":{"x":101,"y":551,"width":798,"height":11}},{"id":"995c38c4-28b6-4aaf-b822-60c1fe3d6420","block_type":"box","text":"securities (exclusive of purchases or sales of U.S. Government Securities and all other securities whose maturities at","page_number":172,"box":{"x":69,"y":566,"width":839,"height":11}},{"id":"abc3aea2-1529-4bca-ba01-df4261589e64","block_type":"box","text":"the time of acquisition were one year or less) by the monthly average value of the securities in the por tfolio during","page_number":172,"box":{"x":68,"y":581,"width":814,"height":12}},{"id":"e3d289c1-e014-4646-b46c-746bfb881776","block_type":"box","text":"the year. A high rate of por tfolio turnover results in cer tain tax consequences, such as increased capital gain","page_number":172,"box":{"x":68,"y":596,"width":777,"height":12}},{"id":"c680af8e-e0f0-4895-8f9c-435085d18f0a","block_type":"box","text":"dividends and/or ordinary income dividends, and in correspondingly greater transaction costs in the form of dealer","page_number":172,"box":{"x":69,"y":612,"width":818,"height":11}},{"id":"b170e251-ac0c-4d1d-9916-fea020948a3b","block_type":"box","text":"spreads and brokerage commissions, which are borne directly by a Fund.","page_number":172,"box":{"x":69,"y":627,"width":519,"height":11}},{"id":"bc2d0f72-1416-4024-b852-ed260d826dbd","block_type":"box","text":"DIVIDENDS AND TAXES","page_number":172,"box":{"x":396,"y":656,"width":186,"height":10}},{"id":"e7a88b29-3e76-4254-a1bd-01d1a25c6e47","block_type":"box","text":"Dividends","page_number":172,"box":{"x":69,"y":687,"width":69,"height":9}},{"id":"fb8a1c76-0112-4bcc-ab40-77351074db1e","block_type":"box","text":"Each Fund intends to distribute substantially all of its net investment income, if any. Dividends from such net","page_number":172,"box":{"x":102,"y":709,"width":776,"height":11}},{"id":"1caf99bd-1ec3-45be-89f7-4cbddcbf8531","block_type":"box","text":"investment income are paid as set for th in each Fund’s Prospectus. Each Fund also intends to distribute all net","page_number":172,"box":{"x":70,"y":724,"width":795,"height":11}},{"id":"36ce754d-82cc-4432-8c21-30afa5232139","block_type":"box","text":"realized capital gains, if any, as set for th in such Fund’s Prospectus. From time to time, a Fund may declare a special","page_number":172,"box":{"x":69,"y":739,"width":837,"height":12}},{"id":"4fb92bc1-84a5-4ebf-8dff-af69dc951f08","block_type":"box","text":"distribution at or about the end of the calendar year in order to comply with U.S. federal tax requirements that cer tain","page_number":172,"box":{"x":69,"y":755,"width":836,"height":11}},{"id":"0456bfea-f252-49e5-bcbb-e0b5bf70b12c","block_type":"box","text":"percentages of its ordinary income and capital gains be distributed during the year. If, in any fiscal year, a Fund has","page_number":172,"box":{"x":70,"y":770,"width":822,"height":11}},{"id":"ffec20ef-086a-4aca-8afe-38fa33dfdaa4","block_type":"box","text":"net income from cer tain foreign currency transactions, such income will be distributed at least annually.","page_number":172,"box":{"x":69,"y":785,"width":739,"height":11}},{"id":"373cdf11-80bc-4c26-83de-2fe4057b14be","block_type":"box","text":"For information concerning the manner in which dividends may be reinvested automatically in shares of each","page_number":172,"box":{"x":102,"y":807,"width":773,"height":12}},{"id":"8ba650a7-20e5-4c1e-bc2c-33489910130e","block_type":"box","text":"Fund, as applicable, see “Shareholder Services — Automatic Dividend Reinvestment Plan.” Shareholders may also","page_number":172,"box":{"x":70,"y":823,"width":819,"height":11}},{"id":"dc513935-e81d-465a-b110-dfe8e8eae0a4","block_type":"box","text":"elect in writing to receive any such dividends in cash. Dividends are taxable to shareholders, as discussed below,","page_number":172,"box":{"x":69,"y":838,"width":807,"height":11}},{"id":"6bf0468d-0f6e-489b-82ea-5e8a000f911e","block_type":"box","text":"whether they are reinvested in shares of the Fund or received in cash. The per share dividends on front-end load","page_number":172,"box":{"x":68,"y":853,"width":800,"height":11}},{"id":"3492a7d7-54a0-40ca-b0f6-12ce10fbe047","block_type":"box","text":"shares, CDSC shares and Service Shares will be lower than the per share dividends on Institutional Shares as a","page_number":172,"box":{"x":69,"y":868,"width":801,"height":11}},{"id":"dd05f556-d3b7-4c0c-872c-be05f0b2e5fd","block_type":"box","text":"result of the service, distribution and higher transfer agency fees applicable to CDSC shares, the service fees","page_number":172,"box":{"x":69,"y":883,"width":783,"height":11}},{"id":"d3ad32f0-625a-4383-a690-8c26b918b3ab","block_type":"box","text":"applicable to front-end load shares and Service Shares, and the service and distribution fees applicable to Class R","page_number":172,"box":{"x":69,"y":898,"width":820,"height":11}},{"id":"f636c4d8-1994-4bb8-87d5-a9c378ab03b0","block_type":"box","text":"II-128","page_number":172,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"bc78a516-ef08-471c-92df-8261f052369f","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":172,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"94d88a19-7916-4fc5-9938-931d5774b7d0","block_type":"box","text":"Shares. Similarly, the per share dividends on CDSC shares and Class R Shares will be lower than the per share","page_number":173,"box":{"x":69,"y":45,"width":794,"height":11}},{"id":"acc89b65-5d7d-422e-b13c-2b2400675ed8","block_type":"box","text":"dividends on front-end load shares and Service Shares as a result of the distribution fees and higher transfer agency","page_number":173,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"fa09e497-3cfe-481b-b98b-dd15d0c6dcfb","block_type":"box","text":"fees applicable to CDSC shares and the distribution fees applicable to Class R Shares, and the per share dividends","page_number":173,"box":{"x":68,"y":75,"width":826,"height":11}},{"id":"f37d9cea-661e-40ea-9c7f-f622f46734eb","block_type":"box","text":"on CDSC shares will be lower than the per share dividends on Class R Shares as a result of the higher distribution","page_number":173,"box":{"x":69,"y":90,"width":816,"height":11}},{"id":"f4d0da85-956b-4f7e-bb9b-9fe25187ffce","block_type":"box","text":"fees and higher transfer agency fees applicable to CDSC shares.","page_number":173,"box":{"x":68,"y":105,"width":461,"height":11}},{"id":"0675c6e3-5764-4897-a1e7-ca4d888c198b","block_type":"box","text":"Taxes","page_number":173,"box":{"x":68,"y":136,"width":42,"height":8}},{"id":"8fd918f9-3aa4-4014-8322-954d14d0cdb0","block_type":"box","text":"Each Fund intends to continue to qualify for the special tax treatment afforded to regulated investment","page_number":173,"box":{"x":102,"y":158,"width":732,"height":11}},{"id":"299337e0-e548-41b4-abb9-a5da4ae088be","block_type":"box","text":"companies under the Code. As long as a Fund so qualifies, the Fund (but not its shareholders) will not be subject to","page_number":173,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"3adc9c01-10b3-41e1-b902-9a5e75b5f065","block_type":"box","text":"U.S. federal income tax on the par t of its investment company taxable income and net realized capital gains that it","page_number":173,"box":{"x":70,"y":188,"width":817,"height":12}},{"id":"0f8f32aa-7b94-4d7d-8f39-73f075cb96da","block_type":"box","text":"distributes to its shareholders in years in which it distributes at least 90% of its investment company taxable income","page_number":173,"box":{"x":69,"y":203,"width":832,"height":12}},{"id":"03dc05bf-4b29-44c6-af59-6fa0ea1a9ae9","block_type":"box","text":"and at least 90% of its net tax-exempt interest income, if any, for the year. To qualify as a regulated investment","page_number":173,"box":{"x":69,"y":218,"width":791,"height":12}},{"id":"5155604e-cf8f-4703-92a2-4aa96af08588","block_type":"box","text":"company, a Fund must meet cer tain requirements regarding the source of its income and the composition and","page_number":173,"box":{"x":69,"y":234,"width":786,"height":11}},{"id":"a5d4bf67-9b4b-490b-aec9-accd0a7eeca9","block_type":"box","text":"diversification of its assets. See Par t II, “Investment Risks and Considerations—Investment Restrictions (All Funds)”","page_number":173,"box":{"x":69,"y":249,"width":831,"height":11}},{"id":"a6bb6551-e4ad-4f01-a37e-3a06bc3ed350","block_type":"box","text":"for a discussion of the asset diversification requirements. In the case of a Feeder Fund, such Fund may look to the","page_number":173,"box":{"x":68,"y":264,"width":819,"height":11}},{"id":"d9a4f12f-c75f-4460-9b6e-80ef91921c62","block_type":"box","text":"underlying assets of the Master Por tfolio in which it has invested for purposes of satisfying the asset diversification","page_number":173,"box":{"x":69,"y":279,"width":824,"height":11}},{"id":"8ca6bbeb-f185-4ae0-a37f-ff07d85a4964","block_type":"box","text":"requirement and various other requirements of the Code applicable to regulated investment companies.","page_number":173,"box":{"x":69,"y":294,"width":739,"height":11}},{"id":"9c5c306b-a882-40b5-912b-2399f0769e20","block_type":"box","text":"A Fund may be able to cure a failure to derive at least 90% of its income from the sources specified above or a","page_number":173,"box":{"x":101,"y":317,"width":792,"height":11}},{"id":"02d5e4dd-95b0-4812-bd8b-13413b33d67f","block_type":"box","text":"failure to diversify its holdings in the manner described above by paying a tax, by disposing of cer tain assets, or by","page_number":173,"box":{"x":68,"y":332,"width":819,"height":11}},{"id":"1149f346-4bb1-4baf-931c-3c775c98c9bb","block_type":"box","text":"paying a tax and disposing of assets. If, in any taxable year, a Fund fails one of these tests and does not timely cure","page_number":173,"box":{"x":70,"y":347,"width":830,"height":11}},{"id":"a8c7414d-d115-43a4-881d-155c6f0b195f","block_type":"box","text":"the failure, the Fund will be taxed in the same manner as an ordinary corporation and distributions to its","page_number":173,"box":{"x":68,"y":362,"width":744,"height":11}},{"id":"be73b1c9-abd5-43ab-9aea-3f6e170f38e6","block_type":"box","text":"shareholders will not be deductible by the Fund in computing its taxable income. Although in general the passive loss","page_number":173,"box":{"x":69,"y":377,"width":835,"height":12}},{"id":"f1e12d73-07c4-4978-8f56-288a2db36d01","block_type":"box","text":"rules of the Code do not apply to regulated investment companies, such rules do apply to a regulated investment","page_number":173,"box":{"x":69,"y":392,"width":808,"height":12}},{"id":"7d942091-3c2d-45e7-9aa1-3a6a9c9e9f9f","block_type":"box","text":"company with respect to items attributable to an interest in a qualified publicly-traded par tnership. A Fund’s","page_number":173,"box":{"x":69,"y":407,"width":767,"height":12}},{"id":"dff3b537-ee1d-4993-868f-f70b02a024ed","block_type":"box","text":"investments in par tnerships, including in qualified publicly-traded par tnerships, may result in the Fund being subject","page_number":173,"box":{"x":70,"y":423,"width":826,"height":11}},{"id":"52ee7345-4b0c-4c6e-a74e-951a9f065180","block_type":"box","text":"to state, local, or non-U.S. income, franchise or withholding tax liabilities.","page_number":173,"box":{"x":68,"y":438,"width":521,"height":11}},{"id":"5a0afc0e-4441-4f79-bc71-f0059d0cdf8e","block_type":"box","text":"Each Fund intends to distribute substantially all of such income and gains. If, in any taxable year, a Fund fails to","page_number":173,"box":{"x":102,"y":460,"width":798,"height":12}},{"id":"35efdc3e-2cd3-4d2c-9e88-4de81b83b27c","block_type":"box","text":"qualify as a regulated investment company under the Code, notwithstanding the availability of cer tain relief","page_number":173,"box":{"x":69,"y":475,"width":762,"height":12}},{"id":"68f87f90-a78b-4776-8215-7d2e51647dc5","block_type":"box","text":"provisions, such Fund would be taxed in the same manner as an ordinary corporation and all distributions from","page_number":173,"box":{"x":70,"y":491,"width":789,"height":11}},{"id":"bfc7927e-c215-4dac-9cfa-7ef7cc72fab4","block_type":"box","text":"earnings and profits (as determined under U.S. federal income tax principles) to its shareholders would be taxable as","page_number":173,"box":{"x":69,"y":506,"width":837,"height":11}},{"id":"8599376f-86e2-4353-9523-e2ef637d80a0","block_type":"box","text":"ordinary dividend income eligible for taxation at a reduced tax rate for non-corporate shareholders and the dividends","page_number":173,"box":{"x":69,"y":521,"width":831,"height":11}},{"id":"95454b1a-21d7-4690-9ea5-0f3eb4e9a82b","block_type":"box","text":"received deduction for corporate shareholders. However, a Municipal Fund’s distributions derived from income on tax","page_number":173,"box":{"x":69,"y":536,"width":837,"height":11}},{"id":"772dba0d-b99a-4f38-8275-cd2da2cecf75","block_type":"box","text":"exempt obligations, as defined herein, would no longer qualify for treatment as exempt interest. Each Fund that is a","page_number":173,"box":{"x":69,"y":551,"width":825,"height":11}},{"id":"9cf00b72-c302-463e-84cd-73a44c73aba5","block_type":"box","text":"series of a regulated investment company that consists of multiple series is treated as a separate corporation for","page_number":173,"box":{"x":69,"y":566,"width":811,"height":11}},{"id":"62065e7a-da18-49a9-ae16-0861db6df397","block_type":"box","text":"U.S. federal income tax purposes, and therefore is considered to be a separate entity in determining its treatment","page_number":173,"box":{"x":70,"y":581,"width":813,"height":12}},{"id":"1cfc1018-211e-4d88-8d07-e36623c8a945","block_type":"box","text":"under the rules for regulated investment companies. Losses in one series of a regulated investment company do not","page_number":173,"box":{"x":69,"y":596,"width":834,"height":12}},{"id":"08e30a79-5df1-4ffd-83e9-b7c1512c30e6","block_type":"box","text":"offset gains in another, and the requirements (other than cer tain organizational requirements) for qualifying for","page_number":173,"box":{"x":69,"y":612,"width":790,"height":11}},{"id":"4af16897-9fa2-46de-8296-9c869c3de867","block_type":"box","text":"regulated investment company status will be determined at the level of the individual series. In the following","page_number":173,"box":{"x":69,"y":627,"width":771,"height":11}},{"id":"ce3f4ba3-2d8a-4602-8607-7a9e2181c998","block_type":"box","text":"discussion, the term “Fund” means each individual series, if applicable.","page_number":173,"box":{"x":69,"y":642,"width":512,"height":11}},{"id":"84ccf2b4-c5e6-4368-b9d7-f3176001af83","block_type":"box","text":"The Code requires a regulated investment company to pay a nondeductible 4% excise tax to the extent the","page_number":173,"box":{"x":101,"y":665,"width":759,"height":11}},{"id":"eff70fc1-5e4f-4215-95c2-5409aa1a871d","block_type":"box","text":"regulated investment company does not distribute, during each calendar year, at least 98% of its ordinary income,","page_number":173,"box":{"x":69,"y":680,"width":813,"height":11}},{"id":"4f0e89ff-76a4-46fa-bcd9-8de3a931a633","block_type":"box","text":"determined on a calendar year basis, and at least 98.2% of its capital gain net income, determined, in general, as if","page_number":173,"box":{"x":69,"y":695,"width":830,"height":11}},{"id":"82aa9886-b881-4fe4-91be-b62e02736afe","block_type":"box","text":"the regulated investment company’s taxable year ended on October 31, plus cer tain undistributed amounts from the","page_number":173,"box":{"x":68,"y":710,"width":832,"height":11}},{"id":"0798578b-0427-457c-a5a5-62fc97a6aca8","block_type":"box","text":"previous years. While each Fund intends to distribute its income and capital gains in the manner necessary to avoid","page_number":173,"box":{"x":70,"y":725,"width":825,"height":11}},{"id":"1b7c4f6e-07ca-4b60-a092-c7c6d884d7a4","block_type":"box","text":"imposition of the 4% excise tax, there can be no assurance that a sufficient amount of the Fund’s taxable income","page_number":173,"box":{"x":70,"y":740,"width":810,"height":11}},{"id":"aa46e966-b0ea-4685-b62b-405994c060cf","block_type":"box","text":"and capital gains will be distributed to avoid entirely the imposition of the tax. In such event, a Fund will be liable for","page_number":173,"box":{"x":69,"y":755,"width":828,"height":11}},{"id":"f3a7a030-1ad2-49e8-99e6-ca30faf48e06","block_type":"box","text":"the tax only on the amount by which it does not meet the foregoing distribution requirements.","page_number":173,"box":{"x":68,"y":770,"width":666,"height":12}},{"id":"7858448e-595b-4384-acb1-ae9f0c5bc8e3","block_type":"box","text":"Net capital loss carryforwards may be applied against realized capital gains in each succeeding year, until they","page_number":173,"box":{"x":102,"y":793,"width":790,"height":11}},{"id":"6ee41fc2-841f-46ad-8281-3c19ace63b8f","block_type":"box","text":"have been reduced to zero. In the event that the Fund were to experience an ownership change as defined under the","page_number":173,"box":{"x":69,"y":808,"width":830,"height":11}},{"id":"e848d78b-c117-40da-adda-a46e7e9596c1","block_type":"box","text":"Code, the Fund’s loss carryforwards and other favorable tax attributes of the Fund, if any, may be subject to","page_number":173,"box":{"x":69,"y":823,"width":770,"height":11}},{"id":"3478a30a-98eb-478d-aa0f-6c560f1efa9c","block_type":"box","text":"limitation.","page_number":173,"box":{"x":70,"y":839,"width":68,"height":8}},{"id":"ee04343b-75f9-4fab-8fc3-50d0a414191e","block_type":"box","text":"Dividends paid by a Fund from its ordinary income or from an excess of net shor t-term capital gain over net long","page_number":173,"box":{"x":102,"y":861,"width":803,"height":11}},{"id":"a3d615fb-c31f-4944-a867-3cdaf73ebd39","block_type":"box","text":"term capital loss (together referred to as “ordinary income dividends”) are taxable to shareholders as ordinary","page_number":173,"box":{"x":68,"y":876,"width":790,"height":11}},{"id":"ae381a93-192d-4739-94c5-cc70ae304214","block_type":"box","text":"income. Distributions made from an excess of net long-term capital gain over net shor t-term capital loss (including","page_number":173,"box":{"x":70,"y":891,"width":815,"height":12}},{"id":"c7c669a0-0b6d-4005-a196-9a0b7c4b84c3","block_type":"box","text":"gains or losses from cer tain transactions in futures and options) (“capital gain dividends”) are taxable to","page_number":173,"box":{"x":68,"y":906,"width":748,"height":12}},{"id":"2ed5ad80-9191-4417-9ed4-bcefc5a01507","block_type":"box","text":"II-129","page_number":173,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"00c15c17-cab5-46f2-9404-c26ed0f52f58","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":173,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"fd6fed23-ceee-446a-8ad2-5c067e853bc3","block_type":"box","text":"shareholders as long-term capital gains, regardless of the length of time the shareholder has owned Fund shares.","page_number":174,"box":{"x":69,"y":45,"width":811,"height":11}},{"id":"573e3158-3ab4-469d-ad74-d119d0e3b659","block_type":"box","text":"Distributions paid by a Fund that are repor ted as exempt-interest dividends will not be subject to regular U.S. federal","page_number":174,"box":{"x":70,"y":60,"width":829,"height":11}},{"id":"f4d96562-0763-42e1-a3d6-2655bc6a8481","block_type":"box","text":"income tax. Cer tain dividend income and long-term capital gains are eligible for taxation at a reduced rate that","page_number":174,"box":{"x":70,"y":75,"width":785,"height":11}},{"id":"445bd4bd-18ea-4363-b79a-6e62aff68801","block_type":"box","text":"applies to non-corporate shareholders. Under these rules, the por tion of ordinary income dividends constituting","page_number":174,"box":{"x":69,"y":90,"width":795,"height":11}},{"id":"346244cf-90f3-4452-a0ab-af278abecb50","block_type":"box","text":"“qualified dividend income” when paid by a regulated investment company to a non-corporate shareholder may be","page_number":174,"box":{"x":70,"y":105,"width":809,"height":11}},{"id":"6942c9c8-98c7-44c4-8fa0-9df4a0c98bee","block_type":"box","text":"taxable to such shareholder at long-term capital gain rates provided the shareholder has held the shares on which","page_number":174,"box":{"x":68,"y":120,"width":814,"height":12}},{"id":"0cccdcd6-665e-4acb-b6a4-7fcf6966055d","block_type":"box","text":"the dividend was paid for at least 61 days during the 121-day period that begins on the date that is 60 days before","page_number":174,"box":{"x":68,"y":135,"width":822,"height":12}},{"id":"f64b3fd7-fd24-45dd-9833-679fce85e719","block_type":"box","text":"the date on which the shares become ex-dividend with respect to such dividend (or, in the case of cer tain","page_number":174,"box":{"x":68,"y":150,"width":751,"height":11}},{"id":"7c7dfb5d-5d81-4a24-9e5b-a738aa8191ea","block_type":"box","text":"accumulated dividends with respect to preferred stocks, the shareholder has held the shares on which the dividend","page_number":174,"box":{"x":69,"y":166,"width":823,"height":11}},{"id":"fe0ebbf5-010a-43c3-bec2-4b9f7df6f5bc","block_type":"box","text":"was paid for at least 91 days during the 181-day period that begins on the date that is 90 days before the date on","page_number":174,"box":{"x":68,"y":181,"width":817,"height":11}},{"id":"2a36b3b6-f627-4a35-b115-da0a7c34132a","block_type":"box","text":"which the shares become ex-dividend with respect to such dividend). However, to the extent a Fund’s distributions","page_number":174,"box":{"x":68,"y":196,"width":813,"height":11}},{"id":"9620d329-3c0d-4ac6-b04b-ad8aef680318","block_type":"box","text":"are derived from income on debt securities, cer tain types of preferred stock treated as debt for U.S. federal income","page_number":174,"box":{"x":69,"y":211,"width":825,"height":11}},{"id":"c0bd8a3e-0e32-4608-b077-d848984a043e","block_type":"box","text":"tax purposes and shor t-term capital gains, such distributions will not constitute “qualified dividend income.” In","page_number":174,"box":{"x":68,"y":226,"width":789,"height":11}},{"id":"bc1645c0-35b1-482d-a052-5c8038c0eb37","block_type":"box","text":"addition, distributions that are derived from securities lending income, such as substitute dividend payments, will not","page_number":174,"box":{"x":69,"y":241,"width":836,"height":11}},{"id":"804c0866-de79-47dc-b7ca-5ffb3337695c","block_type":"box","text":"constitute “qualified dividend income.”","page_number":174,"box":{"x":69,"y":256,"width":275,"height":11}},{"id":"d04bda4d-d52c-4e2b-a2a0-0fdefec8b700","block_type":"box","text":"A 3.8% Medicare tax is imposed on the net investment income (which includes taxable dividends and redemption","page_number":174,"box":{"x":101,"y":279,"width":806,"height":11}},{"id":"b98b2f47-db95-432c-9580-ae36d08f882c","block_type":"box","text":"proceeds) of cer tain individuals, trusts and estates.","page_number":174,"box":{"x":70,"y":294,"width":368,"height":11}},{"id":"8fee48ed-5af3-47a5-bb10-d437bd193b4f","block_type":"box","text":"A Fund’s net capital gain (the excess of net long-term capital gains over net shor t-term capital losses) is not","page_number":174,"box":{"x":101,"y":317,"width":772,"height":11}},{"id":"9f91ab70-4a58-4a15-af5a-3e722cfc5302","block_type":"box","text":"subject to the 90% distribution requirement for taxation as a regulated investment company, described above. If a","page_number":174,"box":{"x":69,"y":332,"width":811,"height":11}},{"id":"3be89939-65ef-4cc6-80c6-904fb3fa2b0b","block_type":"box","text":"Fund retains net capital gain, it is subject to tax on that gain, and may designate the retained amount as","page_number":174,"box":{"x":70,"y":347,"width":745,"height":11}},{"id":"df2844c6-fd74-4bb4-a69b-c38ed3ebc0ba","block_type":"box","text":"undistributed capital gain in a written statement furnished to its shareholders, who will be required to include in","page_number":174,"box":{"x":69,"y":362,"width":795,"height":11}},{"id":"f8581634-5248-4d50-b194-c1e4388542fd","block_type":"box","text":"income, as long-term capital gain, their propor tionate shares of such undistributed net capital gain, will be deemed to","page_number":174,"box":{"x":70,"y":377,"width":838,"height":12}},{"id":"9cc97be7-a40c-46c6-9483-18708a0bee61","block_type":"box","text":"have paid and may claim as a credit against their U.S. federal income tax liability (and as a refund to the extent it","page_number":174,"box":{"x":69,"y":392,"width":809,"height":12}},{"id":"24697e73-2b6b-4fd8-81dd-f95ab2d861cb","block_type":"box","text":"exceeds that liability) their propor tionate shares of the tax paid by the Fund on that gain, and shall increase the tax","page_number":174,"box":{"x":69,"y":407,"width":822,"height":12}},{"id":"8a6c4d03-a942-47a4-997c-9a66d0d214ab","block_type":"box","text":"basis of their shares in the Fund by the excess of the amount included in income over the amount allowed as a credit","page_number":174,"box":{"x":69,"y":423,"width":838,"height":11}},{"id":"54063417-b8af-4a59-804a-de1bb37d2ebf","block_type":"box","text":"against their taxes.","page_number":174,"box":{"x":69,"y":438,"width":135,"height":11}},{"id":"a3b7c257-d9fe-4e67-99c7-71f425940d96","block_type":"box","text":"Distributions in excess of a Fund’s current and accumulated earnings and profits will first reduce the adjusted","page_number":174,"box":{"x":102,"y":460,"width":783,"height":12}},{"id":"660fa101-661d-4905-979d-f0380d9b60c8","block_type":"box","text":"tax basis of a holder’s shares and after such adjusted tax basis is reduced to zero, will constitute capital gains to","page_number":174,"box":{"x":68,"y":475,"width":812,"height":12}},{"id":"34e620ca-72c6-466e-9d48-31dc34a2732b","block_type":"box","text":"such holder (assuming the shares are held as a capital asset). Distributions in excess of a Fund’s minimum","page_number":174,"box":{"x":69,"y":491,"width":769,"height":11}},{"id":"5ea8dc94-900a-43f6-8b35-1ac2e128d192","block_type":"box","text":"distribution requirements (or taxable income) but not in excess of a Fund’s earnings and profits will be taxable to","page_number":174,"box":{"x":69,"y":506,"width":805,"height":11}},{"id":"0dd6568f-2087-410f-9699-67a46c95a328","block_type":"box","text":"shareholders and will not constitute nontaxable returns of capital. In the case of a Fund with a non-calendar taxable","page_number":174,"box":{"x":69,"y":521,"width":824,"height":11}},{"id":"e3a8d956-1b32-48d5-bab9-871450567042","block_type":"box","text":"year, a Fund’s earnings and profits are allocated first to distributions made on or before December 31 of the taxable","page_number":174,"box":{"x":68,"y":536,"width":831,"height":11}},{"id":"a32c0215-75c3-4181-b1e4-b0a3c35f1778","block_type":"box","text":"year, and then to distributions made after December 31 of the taxable year. Any loss upon the sale or exchange of","page_number":174,"box":{"x":68,"y":551,"width":817,"height":11}},{"id":"22fc879c-40b2-4bd3-b756-dd8600c05263","block_type":"box","text":"Fund shares held for six months or less will be treated as long-term capital loss to the extent of any capital gain","page_number":174,"box":{"x":70,"y":566,"width":797,"height":11}},{"id":"79d17e15-699d-4d81-a1a5-d205dee8d840","block_type":"box","text":"dividends received by the shareholder.","page_number":174,"box":{"x":69,"y":582,"width":272,"height":10}},{"id":"9b8c9ff9-217f-49d7-a70a-4aed32ca8800","block_type":"box","text":"Ordinary income and capital gain dividends are taxable to shareholders even if they are reinvested in additional","page_number":174,"box":{"x":102,"y":604,"width":792,"height":11}},{"id":"eb3cf208-2ae6-4c8d-a8cc-c7952f7a2a39","block_type":"box","text":"shares of a Fund. Distributions by a Fund, whether from ordinary income or capital gains, generally will not be eligible","page_number":174,"box":{"x":69,"y":619,"width":835,"height":11}},{"id":"939a08dc-9155-40f5-953f-ec450776b54d","block_type":"box","text":"for the dividends received deduction allowed to corporations under the Code. If a Fund pays a dividend in January","page_number":174,"box":{"x":68,"y":634,"width":809,"height":11}},{"id":"48901025-a841-4e75-a2be-1b7b41dadb54","block_type":"box","text":"that was declared in the previous October, November or December to shareholders of record on a specified date in","page_number":174,"box":{"x":68,"y":649,"width":819,"height":11}},{"id":"e1f7957c-c88b-40ea-89e6-fc46657f6377","block_type":"box","text":"one of such months, then such dividend will be treated for tax purposes as being paid by the Fund and received by its","page_number":174,"box":{"x":69,"y":664,"width":839,"height":12}},{"id":"75860d4c-157e-4c14-882b-83ca652a2223","block_type":"box","text":"shareholders on December 31 of the year in which the dividend was declared. In the case of a Fund with a non","page_number":174,"box":{"x":69,"y":680,"width":794,"height":11}},{"id":"37095a54-e601-42bf-bba8-aa123c47e512","block_type":"box","text":"calendar taxable year, if the Fund repor ts more capital gain dividends than it earns in such taxable year, then the","page_number":174,"box":{"x":69,"y":695,"width":804,"height":11}},{"id":"de8cdc76-cd4a-49ed-9d96-b352017eb290","block_type":"box","text":"Fund will reduce the amounts repor ted as capital gains. Where possible, such reduction will first be allocated to","page_number":174,"box":{"x":70,"y":710,"width":797,"height":11}},{"id":"b8b14b11-243e-4838-b74e-83f28d00f52a","block_type":"box","text":"dividends made after December 31 of such taxable year. A Fund may elect to defer recognizing, until the following","page_number":174,"box":{"x":69,"y":725,"width":810,"height":11}},{"id":"88e807fa-f13f-4baf-a021-d50727ea7dff","block_type":"box","text":"taxable year, cer tain net capital losses arising after October 31 of the current taxable year, and cer tain net ordinary","page_number":174,"box":{"x":68,"y":740,"width":826,"height":11}},{"id":"43379964-e9be-4ee3-9017-6bdbdade15cd","block_type":"box","text":"losses arising after October 31 and/or December 31 of the current taxable year. This may have the effect of","page_number":174,"box":{"x":70,"y":755,"width":772,"height":11}},{"id":"14d51bf6-b9c0-403c-a90b-1602dcb99c0a","block_type":"box","text":"increasing the amount of dividends otherwise includible in the shareholder’s income with respect to the current","page_number":174,"box":{"x":70,"y":770,"width":795,"height":12}},{"id":"e263d21f-7316-48fa-a890-5da27623031b","block_type":"box","text":"taxable year.","page_number":174,"box":{"x":68,"y":786,"width":89,"height":11}},{"id":"1b8cc3a9-ed65-4776-a9d1-7f5bb944c72e","block_type":"box","text":"No gain or loss will be recognized by Investor C shareholders on the conversion to Investor A Shares. A","page_number":174,"box":{"x":102,"y":808,"width":733,"height":11}},{"id":"747f68bf-ca17-4acf-8687-e17de4aaf5dc","block_type":"box","text":"shareholder’s tax basis in the Investor A Shares acquired upon conversion will be the same as the shareholder’s tax","page_number":174,"box":{"x":69,"y":823,"width":832,"height":11}},{"id":"a43fd4e6-a015-44de-8720-ae6396978f12","block_type":"box","text":"basis in the conver ted Investor C Shares and the holding period of the acquired Investor A Shares will include the","page_number":174,"box":{"x":69,"y":838,"width":809,"height":12}},{"id":"624e6115-87f0-4f9f-8f4c-d4d5c2748b6b","block_type":"box","text":"holding period for the conver ted Investor C Shares.","page_number":174,"box":{"x":69,"y":853,"width":362,"height":12}},{"id":"b5cbdf9a-9628-486c-a07a-10ce88815ab7","block_type":"box","text":"If a shareholder of a Fund exercises an exchange privilege within 90 days of acquiring the shares of a Fund, but","page_number":174,"box":{"x":102,"y":876,"width":795,"height":11}},{"id":"db4c3f1c-312b-4f75-80bc-91b54decd50d","block_type":"box","text":"on or before January 31 of the following year, then the loss that the shareholder recognizes on the exchange will be","page_number":174,"box":{"x":69,"y":891,"width":824,"height":12}},{"id":"c51f0a78-837c-4882-9cbe-0f1bd5e66c85","block_type":"box","text":"reduced (or the gain increased) to the extent any sales charge paid on the exchanged shares reduces any sales","page_number":174,"box":{"x":69,"y":907,"width":797,"height":11}},{"id":"acdd0cda-4c26-4274-8d29-a36fea33012b","block_type":"box","text":"II-130","page_number":174,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"e5e755a9-15d2-4333-a599-e78123fa5043","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":174,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"bd294fc6-17c2-422a-9cb1-eb8b8d2198c0","block_type":"box","text":"charge the shareholder would have owed upon the purchase of the new shares in the absence of the exchange","page_number":175,"box":{"x":69,"y":45,"width":791,"height":11}},{"id":"5828ef6e-1fea-4b0c-8780-6083ef1f2ec6","block_type":"box","text":"privilege. Instead, such sales charge will be treated as an amount paid for the new shares.","page_number":175,"box":{"x":70,"y":60,"width":646,"height":11}},{"id":"7ac32b35-35f8-4fb1-8007-7e3fbc4919fa","block_type":"box","text":"A loss realized on a sale or exchange of shares of a Fund will be disallowed if other substantially identical shares","page_number":175,"box":{"x":101,"y":82,"width":807,"height":12}},{"id":"314862ca-8271-4540-9ab5-83a58e94e429","block_type":"box","text":"are acquired (whether through the automatic reinvestment of dividends or otherwise) within a 61-day period beginning","page_number":175,"box":{"x":69,"y":98,"width":839,"height":11}},{"id":"f515be79-67b9-48e8-b367-077c65144d59","block_type":"box","text":"30 days before and ending 30 days after the date on which the shares are sold or exchanged. In such case, the","page_number":175,"box":{"x":69,"y":113,"width":799,"height":11}},{"id":"700243e9-86c2-4024-91c3-e30780c1117c","block_type":"box","text":"basis of the shares acquired will be adjusted to reflect the disallowed loss.","page_number":175,"box":{"x":69,"y":128,"width":534,"height":11}},{"id":"359e5ebc-fba8-4d89-8fcb-a603da6bf6c4","block_type":"box","text":"A Fund is also generally required by law to repor t to each shareholder and to the IRS cost basis information for","page_number":175,"box":{"x":101,"y":150,"width":792,"height":12}},{"id":"5bd92582-1d36-459c-b1df-179c90feb963","block_type":"box","text":"shares of the Fund acquired on or after January 1, 2012, and sold or redeemed after that date. This information","page_number":175,"box":{"x":69,"y":166,"width":800,"height":11}},{"id":"8dec0eda-b3be-4a29-b954-d3cdf67710d9","block_type":"box","text":"includes the adjusted cost basis of the shares, the gross proceeds from disposition, and whether the gain or loss is","page_number":175,"box":{"x":70,"y":181,"width":828,"height":11}},{"id":"7f0d98e8-5ad2-48b3-9cb6-c72fcd476139","block_type":"box","text":"long-term or shor t-term. The adjusted cost basis of shares will be based on the default cost basis repor ting method","page_number":175,"box":{"x":70,"y":196,"width":824,"height":11}},{"id":"427175a3-5462-4d6b-895a-ba45d25ae44d","block_type":"box","text":"selected by the Fund, unless a shareholder, before the sale or redemption, informs the Fund that it has selected a","page_number":175,"box":{"x":69,"y":211,"width":816,"height":11}},{"id":"336ea479-6cc6-43ba-80e0-11f7a69e0f73","block_type":"box","text":"different IRS-accepted method offered by the Fund. These requirements, however, will not apply for investments","page_number":175,"box":{"x":69,"y":226,"width":797,"height":11}},{"id":"cea41ff4-48a9-409d-8738-e65117e5f794","block_type":"box","text":"through an IRA or other tax-advantaged account. Shareholders should consult their tax advisors to determine the best","page_number":175,"box":{"x":68,"y":241,"width":840,"height":11}},{"id":"a93c4921-3314-48b2-bbfd-c10e89059def","block_type":"box","text":"cost basis method for their tax situation, and to obtain more information about how these cost basis repor ting","page_number":175,"box":{"x":69,"y":256,"width":788,"height":12}},{"id":"cb302dd7-6d94-4bb4-acf3-3b9e67fd4cbf","block_type":"box","text":"requirements apply to them. For shares of a Fund acquired before January 1, 2012, these requirements will not","page_number":175,"box":{"x":69,"y":271,"width":797,"height":12}},{"id":"fea33357-d66c-401e-b094-8aad8edb898c","block_type":"box","text":"apply, but the Fund will continue to repor t to the IRS the gross proceeds received by a shareholder from the sale or","page_number":175,"box":{"x":69,"y":286,"width":821,"height":12}},{"id":"297d7b4b-4065-4420-86af-8c896f2abf96","block_type":"box","text":"redemption of such shares.","page_number":175,"box":{"x":69,"y":302,"width":195,"height":11}},{"id":"de614161-19be-4483-bcd0-f566a47b97d2","block_type":"box","text":"Cer tain Funds may invest in derivative contracts such as options, futures contracts, forward contracts and swap","page_number":175,"box":{"x":102,"y":324,"width":799,"height":11}},{"id":"0ae7dfd5-b67a-43a6-bd97-dedc6a07e353","block_type":"box","text":"agreements. The U.S. federal income tax treatment of a derivative contract may not be as favorable as a direct","page_number":175,"box":{"x":69,"y":339,"width":791,"height":12}},{"id":"e136992c-611d-4db2-aed5-25c37b2e6dda","block_type":"box","text":"investment in the underlying security and may adversely affect the timing, character and amount of income the Fund","page_number":175,"box":{"x":70,"y":355,"width":826,"height":11}},{"id":"61fd8921-04c8-4634-b719-4b045284d2a2","block_type":"box","text":"realizes from its investments. As a result, a larger por tion of the Fund’s distributions may be treated as ordinary","page_number":175,"box":{"x":69,"y":370,"width":803,"height":11}},{"id":"6eb6bc0b-dbc6-40a2-89a5-fbdadc6628aa","block_type":"box","text":"income rather than capital gains. In addition, section 1256 contracts held by a Fund at the end of each taxable year","page_number":175,"box":{"x":70,"y":385,"width":825,"height":11}},{"id":"117ec152-edd4-478f-9e86-dc1d9d92983d","block_type":"box","text":"(and, for purposes of the 4% excise tax, cer tain other dates as prescribed under the Code) are generally “marked-to","page_number":175,"box":{"x":69,"y":400,"width":829,"height":11}},{"id":"f4190c08-39a9-4f40-beab-13e374aa2a1b","block_type":"box","text":"market,” such that unrealized gains or losses are treated as though they were realized (with such gain or loss being","page_number":175,"box":{"x":69,"y":415,"width":826,"height":11}},{"id":"d5acde00-c6f5-47b0-875e-3c84c9fac5e7","block_type":"box","text":"considered 60% long-term and 40% shor t-term capital gain or loss), which may increase the amount that must be","page_number":175,"box":{"x":69,"y":430,"width":808,"height":11}},{"id":"047b7ef9-1d90-4f10-8cac-350ea5caf7bb","block_type":"box","text":"distributed to meet distribution requirements and avoid the excise tax. In addition, the tax treatment of cer tain","page_number":175,"box":{"x":69,"y":445,"width":787,"height":11}},{"id":"08c94925-508f-4373-be97-6b4a9e3fc306","block_type":"box","text":"derivative contracts, such as swap agreements, is unsettled and may be subject to future legislation, regulation or","page_number":175,"box":{"x":69,"y":460,"width":816,"height":12}},{"id":"ba771227-c96d-431a-8136-c20e815a1d73","block_type":"box","text":"administrative pronouncements issued by the IRS. If such future guidance limits the Fund’s ability to use derivatives,","page_number":175,"box":{"x":69,"y":475,"width":832,"height":12}},{"id":"3efa01ca-6c5c-4bf6-9194-5c04aa29a823","block_type":"box","text":"the Fund may have to find other ways of achieving its investment objectives.","page_number":175,"box":{"x":68,"y":491,"width":542,"height":11}},{"id":"c3c6947d-c0a0-44a5-b062-6847c378d2c3","block_type":"box","text":"Cer tain swap agreements, including exchange-traded swap agreements, are treated as notional principal","page_number":175,"box":{"x":102,"y":513,"width":744,"height":12}},{"id":"f4562898-af64-43e6-ba00-33f2f9e4c17f","block_type":"box","text":"contracts rather than as section 1256 contracts. This can affect the type of income earned by such swap","page_number":175,"box":{"x":69,"y":528,"width":751,"height":12}},{"id":"0618fb3f-7306-447b-b658-9dc2f0db68fa","block_type":"box","text":"agreements since all the income on a notional principal contract may be ordinary income, whereas 40% of the gain","page_number":175,"box":{"x":69,"y":543,"width":819,"height":12}},{"id":"776785b1-06f3-4510-9e14-8d00e331ec53","block_type":"box","text":"on a section 1256 contract is treated as shor t-term capital gain taxed at ordinary rates and 60% is treated as long","page_number":175,"box":{"x":69,"y":559,"width":823,"height":11}},{"id":"aa1293c2-b926-42b5-af95-4fa773b676ed","block_type":"box","text":"term capital gain taxed at more favorable rates when distributed to shareholders. The rest is long-term capital gain,","page_number":175,"box":{"x":68,"y":574,"width":823,"height":11}},{"id":"232de8a0-0ff3-4a95-9bc6-423ff5219ca6","block_type":"box","text":"which may be taxable at more favorable rates than ordinary income. Proposed regulations interpret what types of","page_number":175,"box":{"x":68,"y":589,"width":807,"height":11}},{"id":"7b20afd5-c42b-44e3-a3ee-672c1f70b5e9","block_type":"box","text":"swap agreements are to be treated as notional principal contracts rather than as section 1256 contracts. When","page_number":175,"box":{"x":69,"y":604,"width":797,"height":11}},{"id":"a822e738-3aff-4ed7-96f1-e72c7120153c","block_type":"box","text":"finalized, these regulations could result in the Fund having to treat more of its income on swap agreements and more","page_number":175,"box":{"x":68,"y":619,"width":838,"height":11}},{"id":"960b50f6-b74f-476c-8ece-6fa505304050","block_type":"box","text":"of the distributions made to shareholders as ordinary income and less as long-term capital gains.","page_number":175,"box":{"x":69,"y":634,"width":695,"height":12}},{"id":"ae246b7a-7600-4b80-b286-7707a6429f3b","block_type":"box","text":"Cer tain Funds may invest in zero coupon U.S. Treasury bonds and other debt securities that are issued at a","page_number":175,"box":{"x":102,"y":657,"width":768,"height":11}},{"id":"84c9eaf9-38ab-4d14-a777-47a706cc38f1","block_type":"box","text":"discount or provide for deferred interest. Even though a Fund receives no actual interest payments on these","page_number":175,"box":{"x":69,"y":672,"width":769,"height":11}},{"id":"0c9f91c2-2ae7-4a51-9d1e-c224af526ada","block_type":"box","text":"securities, it will be deemed to receive income equal, generally, to a por tion of the excess of the stated redemption","page_number":175,"box":{"x":69,"y":687,"width":822,"height":11}},{"id":"cb9c572c-4f1c-459b-a081-67d211f24f23","block_type":"box","text":"price of the securities over their issue price (“original issue discount”) each year that the securities are held. Since","page_number":175,"box":{"x":70,"y":702,"width":819,"height":12}},{"id":"223f08d6-7b8d-4fb7-aff7-7bc93b240492","block_type":"box","text":"the original issue discount income earned by a Fund in a taxable year may not be represented by cash income, the","page_number":175,"box":{"x":68,"y":718,"width":818,"height":11}},{"id":"de8fb791-e453-4238-b458-d3d6f33d410e","block_type":"box","text":"Fund may have to dispose of securities, which it might otherwise have continued to hold, or borrow to generate cash","page_number":175,"box":{"x":70,"y":732,"width":830,"height":12}},{"id":"b108cf3c-3f2d-40e6-b14e-7803fea59f22","block_type":"box","text":"in order to satisfy its distribution requirements. In addition, a Fund’s investment in foreign currencies or foreign","page_number":175,"box":{"x":70,"y":748,"width":792,"height":11}},{"id":"4c955b5a-f3fb-4962-bce9-89e300c5b00d","block_type":"box","text":"currency denominated or referenced debt securities, cer tain asset-backed securities and contingent payment and","page_number":175,"box":{"x":69,"y":763,"width":808,"height":11}},{"id":"884ff557-cd30-40b4-81d4-02c1daf82250","block_type":"box","text":"inflation-indexed debt instruments also may increase or accelerate the Fund’s recognition of income, including the","page_number":175,"box":{"x":70,"y":778,"width":812,"height":11}},{"id":"4af86c42-f79f-4f46-b6c8-0a1ad4a7298d","block_type":"box","text":"recognition of taxable income in excess of cash generated by such investments. Any transaction by the Fund in","page_number":175,"box":{"x":69,"y":793,"width":789,"height":11}},{"id":"e3f72917-dc1b-4436-b954-46ea63569754","block_type":"box","text":"foreign currencies, foreign currency-denominated debt obligations or cer tain foreign currency options, futures","page_number":175,"box":{"x":68,"y":808,"width":777,"height":11}},{"id":"bdf8f98f-5c43-4764-b577-bab1549993ee","block_type":"box","text":"contracts or forward contracts (or similar instruments) may give rise to ordinary income or loss to the extent such","page_number":175,"box":{"x":69,"y":823,"width":810,"height":12}},{"id":"033093c6-2421-4331-95ef-4b6fbb2f7f0b","block_type":"box","text":"income or loss results from fluctuations in the value of the foreign currency concerned. Any such net gains could","page_number":175,"box":{"x":70,"y":838,"width":801,"height":12}},{"id":"5499336d-57f3-48a6-935d-1ed0788ecf46","block_type":"box","text":"require a larger dividend toward the end of the calendar year. Any such net losses will generally reduce and","page_number":175,"box":{"x":69,"y":853,"width":762,"height":12}},{"id":"48d358aa-748b-47d6-977b-bc8df2456d40","block_type":"box","text":"potentially require the recharacterization of prior ordinary income distributions. Such ordinary income treatment may","page_number":175,"box":{"x":70,"y":869,"width":827,"height":11}},{"id":"216b1201-e933-4aa6-b2cb-805d350f9810","block_type":"box","text":"accelerate Fund distributions to shareholders and increase the distributions taxed to shareholders as ordinary","page_number":175,"box":{"x":69,"y":884,"width":787,"height":11}},{"id":"e5b4469a-e6ce-4a22-9b98-478870c655e4","block_type":"box","text":"II-131","page_number":175,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"f52c1385-8809-40e8-b520-77ca28ba1ddc","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":175,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"d8400599-6ffc-4c34-bf3f-d5871a62e7b3","block_type":"box","text":"income. Any net ordinary losses so created cannot be carried forward by the Fund to offset income or gains earned","page_number":176,"box":{"x":70,"y":45,"width":822,"height":11}},{"id":"b4058b91-3165-4e84-9c18-8a793be1b814","block_type":"box","text":"in subsequent taxable years.","page_number":176,"box":{"x":70,"y":60,"width":203,"height":11}},{"id":"bbae1a5b-f95a-4f72-9bd2-010bbd41e2f8","block_type":"box","text":"Ordinary income dividends paid to shareholders who are nonresident aliens or foreign entities (other than pass","page_number":176,"box":{"x":102,"y":82,"width":795,"height":12}},{"id":"634790e9-e882-43b8-8eb7-74861ddf99a6","block_type":"box","text":"through entities to the extent owned by U.S. persons) generally will be subject to a 30% U.S. withholding tax under","page_number":176,"box":{"x":68,"y":98,"width":816,"height":11}},{"id":"d81de423-4480-4cee-b8bd-72477a6566ef","block_type":"box","text":"existing provisions of the Code applicable to foreign individuals and entities unless a reduced rate of withholding or a","page_number":176,"box":{"x":69,"y":113,"width":835,"height":11}},{"id":"a414d06b-b648-43c4-82c6-fe9f9e866d63","block_type":"box","text":"withholding exemption is provided under applicable treaty law. Capital gain dividends paid to shareholders that are","page_number":176,"box":{"x":68,"y":128,"width":815,"height":11}},{"id":"f5f882cb-6a26-447f-ba96-186923522367","block_type":"box","text":"nonresident aliens or foreign entities, if and to the extent properly repor ted as capital gain dividends, generally will","page_number":176,"box":{"x":69,"y":143,"width":816,"height":11}},{"id":"1ddea6c8-18a9-4394-95b1-c249087fea95","block_type":"box","text":"not be subject to a 30% withholding tax, unless cer tain exceptions apply. Dividends derived by a regulated investment","page_number":176,"box":{"x":69,"y":158,"width":840,"height":11}},{"id":"12c9659d-d7d6-4dba-9c9b-bb8cc2b97612","block_type":"box","text":"company from shor t-term capital gains and qualified net interest income (including income from original issue","page_number":176,"box":{"x":69,"y":173,"width":781,"height":11}},{"id":"e1b8b8c3-a5d2-4647-903d-9d830d9b4547","block_type":"box","text":"discount and market discount) and paid to shareholders who are nonresident aliens or foreign entities, if and to the","page_number":176,"box":{"x":69,"y":188,"width":824,"height":12}},{"id":"b3429369-6f2a-438d-ae50-c63031a2a6e4","block_type":"box","text":"extent properly repor ted as “shor t-term capital gain dividends” or “interest-related dividends”, respectively, generally","page_number":176,"box":{"x":69,"y":204,"width":832,"height":11}},{"id":"133a0ad8-18b6-476a-933a-1e10b5380eab","block_type":"box","text":"will not be subject to U.S. withholding tax. Where possible, the Funds intend to repor t such dividends as interest","page_number":176,"box":{"x":68,"y":219,"width":808,"height":11}},{"id":"c33463c2-cc51-4a77-877d-394a470aa932","block_type":"box","text":"related dividends or shor t-term capital gain dividends. However, depending on its circumstances, a Fund may repor t","page_number":176,"box":{"x":69,"y":234,"width":826,"height":11}},{"id":"78a726fc-0e70-44d5-83eb-696d9860c05c","block_type":"box","text":"all, some or none of its potentially eligible dividends as interest-related or as shor t-term capital gain dividends, and/","page_number":176,"box":{"x":69,"y":249,"width":830,"height":11}},{"id":"1438d480-7cb3-4518-b862-6af07b43ba04","block_type":"box","text":"or treat such dividends, in whole or in par t, as ineligible for this exemption from withholding. In order to qualify for","page_number":176,"box":{"x":69,"y":264,"width":811,"height":11}},{"id":"7c59a4de-9eb8-4a08-94f8-1edfeb85ca00","block_type":"box","text":"this exemption from withholding, a foreign shareholder must comply with applicable cer tification requirements","page_number":176,"box":{"x":68,"y":279,"width":784,"height":11}},{"id":"b171e177-b7b1-4f73-b7ed-6b98fec952f5","block_type":"box","text":"relating to its foreign status (including, in general, furnishing an IRS Form W-8BEN, IRS Form W-8BEN-E or substitute","page_number":176,"box":{"x":69,"y":294,"width":828,"height":11}},{"id":"faf56d2c-b085-469c-8bf4-527279f80e68","block_type":"box","text":"Form). In the case of shares held through an intermediary, the intermediary may withhold even if the Fund repor ts the","page_number":176,"box":{"x":70,"y":309,"width":839,"height":11}},{"id":"efcbca9f-f6c1-4458-8e69-5953b416ca0c","block_type":"box","text":"payment as an interest-related or shor t-term capital gain dividend. Foreign shareholders should contact their","page_number":176,"box":{"x":70,"y":325,"width":772,"height":11}},{"id":"9a0015d5-8a2c-4124-9d85-d27b9a8a8d3b","block_type":"box","text":"intermediaries with respect to the application of these rules to their accounts. It is not possible to predict what","page_number":176,"box":{"x":70,"y":339,"width":791,"height":11}},{"id":"efead30c-d154-46ba-b9ff-de41249d78ee","block_type":"box","text":"por tion, if any, of a Fund’s distributions will be repor ted as interest-related dividends or shor t-term capital gain","page_number":176,"box":{"x":70,"y":355,"width":787,"height":11}},{"id":"dc867ba9-ef9f-43f7-8438-a20339cf9e52","block_type":"box","text":"dividends under these rules.","page_number":176,"box":{"x":69,"y":370,"width":201,"height":9}},{"id":"8a83f56b-11f3-4dbe-9c3d-a7d3396ee7be","block_type":"box","text":"Distributions to cer tain foreign shareholders by a Fund at least 50% of the assets of which are “U.S. real","page_number":176,"box":{"x":102,"y":392,"width":747,"height":12}},{"id":"f30cb3c8-3df7-4380-8a44-69b036686982","block_type":"box","text":"proper ty interests” (as defined in the Code and Treasury regulations) at any time during the five-year period ending on","page_number":176,"box":{"x":70,"y":407,"width":838,"height":12}},{"id":"91da878e-c172-4ba2-b064-9aa9ca8193ad","block_type":"box","text":"the date of the distributions, to the extent the distributions are attributable to gains from sales or exchanges of U.S.","page_number":176,"box":{"x":68,"y":423,"width":829,"height":11}},{"id":"32b2e700-5415-4b77-813f-bde324d6f289","block_type":"box","text":"real proper ty interests (including shares in cer tain “U.S. real proper ty holding corporations” such as cer tain REITs,","page_number":176,"box":{"x":69,"y":438,"width":817,"height":11}},{"id":"095eb82e-74d3-4e9b-97b6-572eb4f5659f","block_type":"box","text":"although exceptions may apply if any class of stock of such a corporation is regularly traded on an established","page_number":176,"box":{"x":69,"y":453,"width":786,"height":11}},{"id":"01b679d0-60ab-4409-a4b4-1c4f21b2cfe6","block_type":"box","text":"securities market and the Fund has held no more than 5% of such class of stock at all times during the five-year","page_number":176,"box":{"x":69,"y":468,"width":800,"height":11}},{"id":"c54c5d60-99dc-49e5-a79b-3653eaf04e7e","block_type":"box","text":"period ending on the date of the distributions), generally must be treated by such foreign shareholders as income","page_number":176,"box":{"x":70,"y":483,"width":807,"height":11}},{"id":"0712fa2f-2141-401d-b8a4-8a91b860347d","block_type":"box","text":"effectively connected to a trade or business within the United States, which is generally subject to tax at the","page_number":176,"box":{"x":69,"y":498,"width":772,"height":11}},{"id":"b187a74f-3b0e-4e8d-aa70-a8c833870fae","block_type":"box","text":"graduated rates applicable to U.S. shareholders, except for distributions to foreign shareholders that held no more","page_number":176,"box":{"x":68,"y":513,"width":818,"height":12}},{"id":"e76fed3a-3645-4a42-93f6-f3590327ca43","block_type":"box","text":"than 5% of any class of stock of the Fund at all times during the previous one-year period ending on the date of the","page_number":176,"box":{"x":68,"y":528,"width":820,"height":12}},{"id":"ec329e4d-6d5e-4fdd-a3ad-dad78f5b3871","block_type":"box","text":"distributions. Such distributions will be subject to U.S. income and withholding tax and generally will require a foreign","page_number":176,"box":{"x":69,"y":543,"width":833,"height":12}},{"id":"e6640ff2-5683-4652-b6af-eccdc386b00e","block_type":"box","text":"shareholder to file a U.S. federal income tax return. If the foreign shareholder held no more than 5% of any class of","page_number":176,"box":{"x":69,"y":559,"width":823,"height":11}},{"id":"4400a842-e9de-4b75-b9de-bc62f33c13ba","block_type":"box","text":"stock of the Fund at all times during the previous one-year period ending on the date of the distributions, the","page_number":176,"box":{"x":69,"y":574,"width":774,"height":11}},{"id":"c43857df-8f59-4b98-b38c-ebda2b8eee82","block_type":"box","text":"distributions will be taxable as ordinary dividends and subject to withholding at a 30% or lower treaty rate. In addition,","page_number":176,"box":{"x":69,"y":589,"width":839,"height":11}},{"id":"21d8ef07-eb5d-4991-a257-09bd1ff8e98c","block_type":"box","text":"sales or redemptions of shares held by cer tain foreign shareholders in such a Fund generally will be subject to U.S.","page_number":176,"box":{"x":69,"y":604,"width":822,"height":11}},{"id":"cd89b905-9a9b-4c80-9b10-5947c5a108ef","block_type":"box","text":"income and withholding tax and generally will require the foreign shareholder to file a U.S. federal income tax return,","page_number":176,"box":{"x":70,"y":619,"width":827,"height":11}},{"id":"217ba185-424b-40c1-91c3-1442ed859f41","block_type":"box","text":"although exceptions may apply if more than 50% of the value of the Fund’s shares are held by U.S. shareholders or","page_number":176,"box":{"x":69,"y":634,"width":823,"height":12}},{"id":"c818244c-b88b-43d8-b5f4-52153f3989da","block_type":"box","text":"the foreign shareholder selling or redeeming the shares has held no more than 5% of any class of stock of the Fund","page_number":176,"box":{"x":68,"y":649,"width":827,"height":12}},{"id":"3b5bc58d-d038-4947-bae4-a86b81fa8336","block_type":"box","text":"at all times during the five-year period ending on the date of the sale or redemption.","page_number":176,"box":{"x":69,"y":664,"width":596,"height":12}},{"id":"59984391-fc2d-4458-b14d-0fe0e761dbbc","block_type":"box","text":"Provided that more than 50% of the value of a Fund’s stock is held by U.S. shareholders, redemptions and other","page_number":176,"box":{"x":102,"y":687,"width":802,"height":11}},{"id":"145557de-b7a1-4723-ae76-50a2baecaada","block_type":"box","text":"distributions made in the form of U.S. real proper ty interests (including shares in cer tain “U.S. real proper ty holding","page_number":176,"box":{"x":69,"y":702,"width":827,"height":12}},{"id":"7a4e1dd7-9a8e-4c16-aaec-bddddac8c2cf","block_type":"box","text":"corporations”, although exceptions may apply if any class of stock of such a corporation is regularly traded on an","page_number":176,"box":{"x":69,"y":717,"width":804,"height":12}},{"id":"d8b4fa7b-7b8f-4564-8b4c-4d7c37b69832","block_type":"box","text":"established securities market and the Fund has held no more than 5% of such class of stock at all times during the","page_number":176,"box":{"x":69,"y":732,"width":824,"height":12}},{"id":"709feeb3-6761-4c46-bab4-0ad3790c3838","block_type":"box","text":"five-year period ending on the date of the distribution) generally will cause the Fund to recognize a por tion of any","page_number":176,"box":{"x":68,"y":748,"width":801,"height":11}},{"id":"591e4094-352c-4435-8c69-7b20d42468a9","block_type":"box","text":"unrecognized gain in the U.S. real proper ty interests equal to the product of (i) the excess of fair market value of","page_number":176,"box":{"x":69,"y":763,"width":803,"height":11}},{"id":"9ebe5867-447a-4161-bf62-21b5f991fd2a","block_type":"box","text":"such U.S. real proper ty interests over the Fund’s adjusted bases in such interests and (ii) the greatest foreign","page_number":176,"box":{"x":69,"y":778,"width":785,"height":11}},{"id":"8d31d45d-df76-4f6b-90af-afb7e066679f","block_type":"box","text":"ownership percentage of the Fund during the five-year period ending on the date of distribution.","page_number":176,"box":{"x":69,"y":793,"width":676,"height":11}},{"id":"981b31f8-6cef-4bd9-81c7-eee10aec1ed5","block_type":"box","text":"A foreign shareholder may also be subject to cer tain “wash sale” rules to prevent the avoidance of the tax filing","page_number":176,"box":{"x":101,"y":816,"width":798,"height":11}},{"id":"00cb8e2c-6632-400e-b855-771a14690889","block_type":"box","text":"and payment obligations discussed above through the sale and repurchase of Fund shares.","page_number":176,"box":{"x":69,"y":831,"width":651,"height":11}},{"id":"9da7eb33-46d1-4241-9585-448282b3b629","block_type":"box","text":"Shareholders that are nonresident aliens or foreign entities are urged to consult their own tax advisors","page_number":176,"box":{"x":102,"y":853,"width":731,"height":12}},{"id":"353f9a07-f2b3-4dac-bc7c-935b0f7d9c3e","block_type":"box","text":"concerning the par ticular tax consequences to them of an investment in a Fund.","page_number":176,"box":{"x":69,"y":869,"width":570,"height":11}},{"id":"0403e68f-e852-4880-8a8f-5747747ddbff","block_type":"box","text":"Separately, a 30% withholding tax is currently imposed on U.S.-source dividends, interest and other income","page_number":176,"box":{"x":102,"y":891,"width":763,"height":12}},{"id":"af76638d-f067-481d-9806-71f6f43caaea","block_type":"box","text":"items paid to (i) cer tain foreign financial institutions and investment funds, and (ii) cer tain other foreign entities. To","page_number":176,"box":{"x":70,"y":906,"width":820,"height":12}},{"id":"54d80fb0-89da-496c-9195-282470ed0c1b","block_type":"box","text":"II-132","page_number":176,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"bc7a6dbf-7190-4771-95e9-e1f6111c33e4","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":176,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"1ebe1d6e-3058-48a7-a645-1a3c221b1035","block_type":"box","text":"avoid withholding, foreign financial institutions and investment funds will generally either need to (a) collect and","page_number":177,"box":{"x":69,"y":45,"width":794,"height":11}},{"id":"0b279a39-e8af-4cbb-9088-8f1d00ccd14c","block_type":"box","text":"repor t to the IRS detailed information identifying their U.S. accounts and U.S. account holders, comply with due","page_number":177,"box":{"x":69,"y":60,"width":794,"height":11}},{"id":"6182d7b6-d624-4c37-a3da-1a534e205849","block_type":"box","text":"diligence procedures for identifying U.S. accounts and withhold tax on cer tain payments made to noncomplying","page_number":177,"box":{"x":69,"y":75,"width":791,"height":11}},{"id":"2695ad25-f2a0-42d5-b75b-44acc389ef35","block_type":"box","text":"foreign entities and account holders or (b) if an intergovernmental agreement is entered into and implementing","page_number":177,"box":{"x":68,"y":90,"width":791,"height":11}},{"id":"7009a839-7881-47bb-a4bf-9c5f23316df6","block_type":"box","text":"legislation is adopted, comply with the agreement and legislation. Other foreign entities will generally either need to","page_number":177,"box":{"x":70,"y":105,"width":822,"height":11}},{"id":"a624804d-1029-43c5-bb72-80e74abab818","block_type":"box","text":"provide detailed information identifying each substantial U.S. owner or cer tify there are no such owners.","page_number":177,"box":{"x":70,"y":120,"width":739,"height":12}},{"id":"ae9160cd-942b-4c8a-a162-290f6467d459","block_type":"box","text":"Under cer tain provisions of the Code, some shareholders may be subject to a 24% withholding tax on ordinary","page_number":177,"box":{"x":102,"y":143,"width":786,"height":11}},{"id":"2c249cab-6437-4d23-a826-678fcd5b166b","block_type":"box","text":"income dividends, capital gain dividends and redemption payments (“backup withholding”). Generally, shareholders","page_number":177,"box":{"x":70,"y":158,"width":820,"height":11}},{"id":"6e1bc19e-79ff-4c55-b356-0eda9b34cc35","block_type":"box","text":"subject to backup withholding will be non-corporate shareholders for whom no cer tified taxpayer identification number","page_number":177,"box":{"x":69,"y":173,"width":837,"height":11}},{"id":"3a1488cd-1ac5-4e23-8f59-04777747b36f","block_type":"box","text":"is on file with the Fund or who, to the Fund’s knowledge, have furnished an incorrect number. When establishing an","page_number":177,"box":{"x":70,"y":188,"width":821,"height":12}},{"id":"a404525f-c53e-4627-b21f-d28460964986","block_type":"box","text":"account, an investor must cer tify under penalty of perjury that such number is correct and that such investor is not","page_number":177,"box":{"x":69,"y":203,"width":819,"height":12}},{"id":"c673c699-358c-4c2f-a6e5-f1243e8aca11","block_type":"box","text":"otherwise subject to backup withholding. Backup withholding is not an additional tax. Any amount withheld generally","page_number":177,"box":{"x":69,"y":219,"width":826,"height":11}},{"id":"64b6fecb-239b-440e-9279-a1520a888cfa","block_type":"box","text":"may be allowed as a refund or a credit against a shareholder’s U.S. federal income tax liability, provided that the","page_number":177,"box":{"x":69,"y":234,"width":802,"height":11}},{"id":"7d8dd8fe-ce7b-43e6-9a60-fc96c448ac16","block_type":"box","text":"required information is timely forwarded to the IRS.","page_number":177,"box":{"x":69,"y":249,"width":364,"height":11}},{"id":"c527c5ec-629c-4970-84be-1a21f262d530","block_type":"box","text":"If a shareholder recognizes a loss with respect to a Fund’s shares of at least $2 million in any single taxable","page_number":177,"box":{"x":102,"y":271,"width":774,"height":12}},{"id":"3091fc39-5133-4d9d-b337-4afa66deb704","block_type":"box","text":"year or $4 million in any combination of taxable years for an individual shareholder or $10 million in any single","page_number":177,"box":{"x":68,"y":286,"width":787,"height":12}},{"id":"b57aa75c-99d7-4836-b719-e28e2cb8002c","block_type":"box","text":"taxable year or $20 million in any combination of taxable years for a corporate shareholder in any single taxable year,","page_number":177,"box":{"x":68,"y":301,"width":835,"height":12}},{"id":"672cc4fe-e93a-4e01-a802-a0da1276a16f","block_type":"box","text":"the shareholder must file a disclosure statement on IRS Form 8886 with the IRS. Direct shareholders of por tfolio","page_number":177,"box":{"x":68,"y":317,"width":809,"height":11}},{"id":"512d550a-33e8-4170-8704-a465550e3fe7","block_type":"box","text":"securities are in many cases exempted. That a loss is repor table under these regulations does not affect the legal","page_number":177,"box":{"x":69,"y":332,"width":817,"height":11}},{"id":"763055c5-7c64-4bc7-b564-78c55fb2f704","block_type":"box","text":"determination of whether the taxpayer’s treatment of the loss is proper. Shareholders should consult their tax","page_number":177,"box":{"x":69,"y":347,"width":783,"height":11}},{"id":"e05788bb-78a0-4421-9b80-5850e7e566ce","block_type":"box","text":"advisors to determine the applicability of these regulations in light of their individual circumstances.","page_number":177,"box":{"x":69,"y":362,"width":710,"height":11}},{"id":"7e526e63-37ef-4955-ad77-e5acbc027204","block_type":"box","text":"Cer tain types of income received by a Fund from REITs, real estate mor tgage investment conduits, taxable","page_number":177,"box":{"x":102,"y":385,"width":758,"height":11}},{"id":"bbe8b352-711b-47d7-b7c1-90205984c149","block_type":"box","text":"mor tgage pools or other investments may cause the Fund to repor t some or all of its distributions as “excess","page_number":177,"box":{"x":69,"y":400,"width":782,"height":11}},{"id":"fd87fe83-6374-4b32-aee9-742ed8830875","block_type":"box","text":"inclusion income.” To Fund shareholders, such excess inclusion income may: (i) constitute taxable income, as","page_number":177,"box":{"x":70,"y":415,"width":783,"height":11}},{"id":"5ec2e841-07b0-45bb-ac77-5446ee77eba6","block_type":"box","text":"unrelated business taxable income (“UBTI”) for those shareholders who would otherwise be tax-exempt such as","page_number":177,"box":{"x":69,"y":430,"width":797,"height":11}},{"id":"19cba890-8f2b-4825-9031-0a63600d9945","block_type":"box","text":"individual retirement accounts, 401(k) accounts, Keogh plans, pension plans and cer tain charitable entities; (ii) not","page_number":177,"box":{"x":70,"y":445,"width":822,"height":12}},{"id":"1b566c95-e9b6-4b10-84ff-c874911ed637","block_type":"box","text":"be offset by otherwise allowable deductions for tax purposes; (iii) not be eligible for reduced U.S. withholding for non","page_number":177,"box":{"x":69,"y":460,"width":836,"height":12}},{"id":"d0db30cd-02b0-489b-a5ad-242ab6315711","block_type":"box","text":"U.S. shareholders even from tax treaty countries; and (iv) cause the Fund to be subject to tax if cer tain “disqualified","page_number":177,"box":{"x":70,"y":475,"width":826,"height":12}},{"id":"14c2c23a-96c6-4199-9236-acdbf0c65eb3","block_type":"box","text":"organizations,” as defined by the Code, are Fund shareholders. The Fund tries to avoid investing in REITs that are","page_number":177,"box":{"x":69,"y":491,"width":808,"height":11}},{"id":"2015673c-1f89-49da-a661-bae8e6ccac13","block_type":"box","text":"expected to generate excess inclusion income, but the Fund may not always be successful in doing so. Because","page_number":177,"box":{"x":69,"y":506,"width":800,"height":11}},{"id":"291e1805-d089-471f-95f0-8fcd7334055f","block_type":"box","text":"information about a REIT’s investments may be inadequate or inaccurate, or because a REIT may change its","page_number":177,"box":{"x":70,"y":521,"width":770,"height":11}},{"id":"fae15a80-e300-4ffa-81ce-f8991fb51905","block_type":"box","text":"investment program, the Fund may not be successful in avoiding the consequences described above. Avoidance of","page_number":177,"box":{"x":70,"y":536,"width":816,"height":11}},{"id":"e48ab568-b069-490a-9852-3a450a77c1b6","block_type":"box","text":"investments in REITs that generate excess inclusion income may require the Fund to forego otherwise attractive","page_number":177,"box":{"x":70,"y":551,"width":796,"height":11}},{"id":"a7cf7290-e1fc-4222-970d-7d45e9749c42","block_type":"box","text":"investment oppor tunities.","page_number":177,"box":{"x":70,"y":566,"width":180,"height":11}},{"id":"37e6b930-754a-4499-bcf9-fe7850b86d8f","block_type":"box","text":"Dividends and interest received and capital gains realized by a Fund may give rise to withholding and other taxes","page_number":177,"box":{"x":102,"y":589,"width":801,"height":11}},{"id":"ca6b63c6-6812-48d1-98b8-458eb1467d54","block_type":"box","text":"imposed by foreign countries. Tax conventions between cer tain foreign countries and the United States may reduce or","page_number":177,"box":{"x":70,"y":604,"width":839,"height":11}},{"id":"96a614fb-66ee-4eb4-931d-0ad78763b818","block_type":"box","text":"eliminate such taxes. Shareholders of a Fund more than 50% by value of the assets of which at the close of a taxable","page_number":177,"box":{"x":69,"y":619,"width":840,"height":11}},{"id":"01a244df-8502-475f-9e44-bd88c5b2f096","block_type":"box","text":"year are foreign securities may be able to claim U.S. foreign tax credits with respect to such foreign taxes paid by the","page_number":177,"box":{"x":68,"y":634,"width":837,"height":12}},{"id":"f1b7ff73-20f2-4757-879f-76b0b525af21","block_type":"box","text":"Fund, subject to cer tain requirements and limitations contained in the Code. For example, cer tain retirement","page_number":177,"box":{"x":70,"y":649,"width":774,"height":11}},{"id":"9ce76761-d59d-4dde-b460-bf017f4731fc","block_type":"box","text":"accounts and cer tain tax-exempt organizations cannot claim foreign tax credits on investments in foreign securities","page_number":177,"box":{"x":69,"y":664,"width":820,"height":12}},{"id":"4cf1e702-0486-42b6-a1bf-399495334e0a","block_type":"box","text":"held in a Fund. In addition, a foreign tax credit may be claimed with respect to withholding tax on payments with","page_number":177,"box":{"x":69,"y":680,"width":795,"height":11}},{"id":"5bee77c3-6d3d-4327-b06c-ab7e9cc28457","block_type":"box","text":"respect to a security only if the holder of the security meets cer tain holding period requirements. Both the","page_number":177,"box":{"x":69,"y":695,"width":755,"height":11}},{"id":"a22f73cc-e99f-40c2-970c-1cfb1c4ad958","block_type":"box","text":"shareholder and the Fund must meet these holding period requirements, and if a Fund fails to do so, it will not be","page_number":177,"box":{"x":69,"y":710,"width":811,"height":11}},{"id":"1641649d-2af1-47e6-bd7e-db2c21bcff63","block_type":"box","text":"able to “pass through” to shareholders the ability to claim a credit or a deduction for the related foreign taxes paid by","page_number":177,"box":{"x":69,"y":725,"width":839,"height":11}},{"id":"f5c4d174-7ebe-448e-9b07-887bab377249","block_type":"box","text":"the Fund. Fur ther, to the extent that a Fund engages in securities lending with respect to a security paying income","page_number":177,"box":{"x":68,"y":740,"width":812,"height":11}},{"id":"bec21257-7c27-42c9-8346-0d677da2d678","block_type":"box","text":"subject to foreign taxes, it may not be able to pass through to its shareholders the ability to take a foreign tax credit","page_number":177,"box":{"x":69,"y":755,"width":829,"height":11}},{"id":"3600f14c-5384-48a9-9296-e416281238cf","block_type":"box","text":"for those taxes. If a Fund satisfies the applicable requirements, such Fund will be eligible to file an election with the","page_number":177,"box":{"x":68,"y":770,"width":827,"height":12}},{"id":"59afb228-af02-498b-9dc1-fb11ff01dd60","block_type":"box","text":"IRS pursuant to which shareholders of the Fund will be required to include their propor tionate shares of such foreign","page_number":177,"box":{"x":70,"y":785,"width":829,"height":12}},{"id":"b4fd2893-dd0a-4f26-a0ab-88f0074cb2c3","block_type":"box","text":"taxes in their U.S. income tax returns as gross income, treat such propor tionate shares as taxes paid by them, and","page_number":177,"box":{"x":68,"y":801,"width":825,"height":11}},{"id":"fe1d54eb-92b8-4af9-8d0e-bf2d7544f8fb","block_type":"box","text":"deduct such propor tionate shares in computing their taxable incomes or, alternatively, use them as foreign tax","page_number":177,"box":{"x":69,"y":816,"width":788,"height":11}},{"id":"c7afad2e-55d0-49b4-b3e0-896eda439e3b","block_type":"box","text":"credits against their U.S. income taxes. No deductions for foreign taxes, however, may be claimed by noncorporate","page_number":177,"box":{"x":69,"y":831,"width":818,"height":11}},{"id":"39b36fa5-85cd-427f-971b-7667dc273792","block_type":"box","text":"shareholders who do not itemize deductions. A shareholder that is a nonresident alien individual or a foreign","page_number":177,"box":{"x":69,"y":846,"width":773,"height":11}},{"id":"3ee0321a-07fe-4693-9551-7208c6f5ee5d","block_type":"box","text":"corporation may be subject to U.S. withholding tax on the income resulting from a Fund’s election described in this","page_number":177,"box":{"x":69,"y":861,"width":817,"height":11}},{"id":"1b64e112-e743-4a5b-b216-fa5ba559d55b","block_type":"box","text":"paragraph but may not be able to claim a credit or deduction against such U.S. tax for the foreign taxes treated as","page_number":177,"box":{"x":70,"y":876,"width":814,"height":11}},{"id":"d651aae0-51a3-4488-9005-1a745b101867","block_type":"box","text":"having been paid by such shareholder. A Fund will repor t annually to its shareholders the amount per share of such","page_number":177,"box":{"x":69,"y":891,"width":821,"height":12}},{"id":"2dafec6b-e1ae-43cf-a4c9-4ffe6df90bbf","block_type":"box","text":"foreign taxes and other information needed to claim the foreign tax credit.","page_number":177,"box":{"x":68,"y":906,"width":527,"height":12}},{"id":"754c8a80-a0bc-4420-b8a6-c315015aedb7","block_type":"box","text":"II-133","page_number":177,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"6ef99093-4704-42e9-a5e1-61c69c27a672","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":177,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"26e1d209-72c0-47c7-a249-3b8462eefb96","block_type":"box","text":"Cer tain transactions entered into by the Funds are subject to special tax rules of the Code that may, among","page_number":178,"box":{"x":102,"y":45,"width":768,"height":11}},{"id":"c90a8f87-f007-43f0-9f4c-bc5c66028025","block_type":"box","text":"other things, (a) affect the character of gains and losses realized, (b) disallow, suspend or otherwise limit the","page_number":178,"box":{"x":69,"y":60,"width":780,"height":11}},{"id":"cad7b9a7-9545-4921-84f4-6995f6e6c501","block_type":"box","text":"allowance of cer tain losses or deductions, and (c) accelerate the recognition of income without a corresponding","page_number":178,"box":{"x":69,"y":75,"width":797,"height":11}},{"id":"fd50a0ff-c10a-4df3-a45f-7bb2c8314abf","block_type":"box","text":"receipt of cash (with which to make the necessary distributions to satisfy distribution requirements applicable to","page_number":178,"box":{"x":69,"y":90,"width":802,"height":11}},{"id":"05968ee0-543d-413b-b942-b3eb99491692","block_type":"box","text":"regulated investment companies). Operation of these rules could, therefore, affect the character, amount and timing","page_number":178,"box":{"x":69,"y":105,"width":831,"height":11}},{"id":"ffaecbfc-5ec3-4bac-9b96-32de0a685568","block_type":"box","text":"of distributions to shareholders. Special tax rules also may require a Fund to mark-to-market cer tain types of","page_number":178,"box":{"x":69,"y":120,"width":776,"height":11}},{"id":"a80d132f-6fa5-49db-860b-7ee7b33b494f","block_type":"box","text":"positions in its por tfolio (","page_number":178,"box":{"x":70,"y":135,"width":177,"height":11}},{"id":"8968fe61-feea-4412-873d-45b9f3b11456","block_type":"box","text":"i.e.","page_number":178,"box":{"x":249,"y":136,"width":20,"height":8}},{"id":"e6e9544e-66c5-4917-b8e5-9780937aedf3","block_type":"box","text":", treat them as sold on the last day of the taxable year), and may result in the recognition","page_number":178,"box":{"x":272,"y":135,"width":636,"height":12}},{"id":"bdbf515b-0191-47be-9dd8-6e8030e4d2d4","block_type":"box","text":"of income without a corresponding receipt of cash. Funds engaging in transactions affected by these provisions","page_number":178,"box":{"x":69,"y":150,"width":795,"height":12}},{"id":"8e6b8927-26e0-44e9-ad43-84bd9ff567c1","block_type":"box","text":"intend to monitor their transactions, make appropriate tax elections and make appropriate entries in their books and","page_number":178,"box":{"x":70,"y":166,"width":830,"height":11}},{"id":"b4baa38b-6e13-49c7-8c47-2705db4dab74","block_type":"box","text":"records to lessen the effect of these tax rules and avoid any possible disqualification from the special treatment","page_number":178,"box":{"x":69,"y":181,"width":804,"height":11}},{"id":"130b4ba8-c79a-4c3e-acbc-a5cc0f01c903","block_type":"box","text":"afforded regulated investment companies under the Code.","page_number":178,"box":{"x":69,"y":196,"width":415,"height":11}},{"id":"eb308588-4f3b-4d97-8c5d-37fac9ddaffe","block_type":"box","text":"Cer tain of a Fund’s investments in derivative instruments and foreign currency-denominated instruments, and","page_number":178,"box":{"x":102,"y":218,"width":781,"height":12}},{"id":"3b5900e1-1b7f-4ec1-a770-b25b8698b36d","block_type":"box","text":"any of the Fund’s transactions in foreign currencies and hedging activities, are likely to produce a difference between","page_number":178,"box":{"x":69,"y":234,"width":835,"height":11}},{"id":"16bc2258-1d9d-4e0b-8013-8b267fb9bf78","block_type":"box","text":"its book income and the sum of its taxable income and net tax-exempt income (if any). If such a difference arises,","page_number":178,"box":{"x":70,"y":249,"width":811,"height":11}},{"id":"ee7d2840-a686-44c1-803c-bbbc6c1ae360","block_type":"box","text":"and the Fund’s book income is less than the sum of its taxable income and net tax-exempt income, the Fund could","page_number":178,"box":{"x":69,"y":264,"width":818,"height":11}},{"id":"7d24caf8-2226-41e0-84f3-fc64dd5c906b","block_type":"box","text":"be required to make distributions exceeding book income to qualify as a RIC that is accorded special tax treatment","page_number":178,"box":{"x":69,"y":279,"width":820,"height":11}},{"id":"907516f6-9dc4-4a08-b02a-ec91483cb322","block_type":"box","text":"and to avoid an entity-level tax. In the alternative, if the Fund makes any distribution based on book income and such","page_number":178,"box":{"x":69,"y":294,"width":834,"height":11}},{"id":"add1aa7b-5b37-497c-b251-85a7c9c55d72","block_type":"box","text":"book income exceeds the sum of its taxable income (including realized capital gains) and net tax-exempt income, the","page_number":178,"box":{"x":69,"y":309,"width":833,"height":11}},{"id":"f07d6a12-8b13-4c2c-8d6c-a9939eb08ca4","block_type":"box","text":"distribution (if any) of such excess generally will be treated as (i) a dividend to the extent of the Fund’s remaining","page_number":178,"box":{"x":69,"y":324,"width":805,"height":12}},{"id":"f84eda65-dc35-4538-bce2-445fa1a1626f","block_type":"box","text":"earnings and profits (including earnings and profits arising from tax-exempt income), (ii) thereafter, as a return of","page_number":178,"box":{"x":69,"y":339,"width":805,"height":12}},{"id":"46886ed3-b391-473a-b3b6-b74bc459f45f","block_type":"box","text":"capital to the extent of the recipient’s basis in its shares, and (iii) thereafter as gain from the sale or exchange of a","page_number":178,"box":{"x":69,"y":355,"width":822,"height":11}},{"id":"cfb136ca-117c-4575-ad2b-d48ad5bae3d4","block_type":"box","text":"capital asset.","page_number":178,"box":{"x":69,"y":370,"width":95,"height":11}},{"id":"709cba9f-51e5-4fc9-b096-466515eef779","block_type":"box","text":"If a Fund invests in underlying funds, the Fund’s realized losses on sales of shares of underlying funds may be","page_number":178,"box":{"x":102,"y":392,"width":787,"height":12}},{"id":"4ec0c576-b216-48f6-afa5-6b8c159428b0","block_type":"box","text":"indefinitely or permanently deferred as “wash sales.” Distributions of shor t-term capital gains by underlying funds will","page_number":178,"box":{"x":70,"y":407,"width":836,"height":12}},{"id":"d8045731-b272-4736-9a81-dc48fa254ca9","block_type":"box","text":"be recognized as ordinary income by the Fund and would not be offset by the Fund’s capital loss carryforwards, if","page_number":178,"box":{"x":69,"y":423,"width":812,"height":11}},{"id":"8fb00d6e-dccc-4b70-9cb0-e57295c40c10","block_type":"box","text":"any. Capital loss carryforwards of underlying funds, if any, would not offset net capital gains of the Fund. Each of","page_number":178,"box":{"x":69,"y":438,"width":805,"height":11}},{"id":"819d7b8b-cfed-4c0d-95c3-e94d256c9d1f","block_type":"box","text":"these effects is caused by the Fund’s expected investment in the underlying funds and may result in distributions to","page_number":178,"box":{"x":68,"y":453,"width":829,"height":11}},{"id":"6910ed2f-41c1-4f06-9d4f-d26d1e60f683","block_type":"box","text":"Fund shareholders being of higher magnitudes and less likely to qualify for lower capital gain tax rates than if the","page_number":178,"box":{"x":70,"y":468,"width":803,"height":11}},{"id":"9d7b909a-f6d5-4d94-957b-74c40237873b","block_type":"box","text":"Fund were to invest otherwise.","page_number":178,"box":{"x":70,"y":483,"width":216,"height":9}},{"id":"8d302cca-3a86-4073-8fcf-ecb0c9b4faab","block_type":"box","text":"A Fund may take cer tain positions through a wholly-owned (or majority-owned), foreign subsidiary (the","page_number":178,"box":{"x":101,"y":506,"width":721,"height":11}},{"id":"270816b9-6883-43f1-8e38-979d2d368932","block_type":"box","text":"“Subsidiary”). It is expected that the Subsidiary will be a “controlled foreign corporation” and that all of its net","page_number":178,"box":{"x":70,"y":521,"width":787,"height":11}},{"id":"04122378-c973-4c9f-bb0c-0ef0a89fbb5f","block_type":"box","text":"income will be “subpar t F income” for U.S. federal income tax purposes. If that is the case, the Fund will be required","page_number":178,"box":{"x":70,"y":536,"width":831,"height":11}},{"id":"bc22c54c-8fbf-43ee-9698-33acfb3f5153","block_type":"box","text":"to repor t all of the Subsidiary’s net income as ordinary income regardless of whether that income would be treated","page_number":178,"box":{"x":68,"y":551,"width":823,"height":11}},{"id":"662a57b0-3179-4769-be85-0fcfeaed6967","block_type":"box","text":"differently (for example, as capital gain) at the Subsidiary level and regardless of whether that income is distributed","page_number":178,"box":{"x":69,"y":566,"width":825,"height":11}},{"id":"fb4e6dda-e015-4920-bc07-4a1388433235","block_type":"box","text":"to the Fund. (Previously taxed income will not, however, be taxable again when distributed.) If a net loss is realized by","page_number":178,"box":{"x":68,"y":581,"width":838,"height":12}},{"id":"c57dd0dc-778b-414b-802b-163103043ced","block_type":"box","text":"the Subsidiary in any taxable year, the loss will generally not be available to offset the Fund’s other income. It is not","page_number":178,"box":{"x":68,"y":596,"width":830,"height":12}},{"id":"36f1d2cd-49b0-469b-9669-4f10018231d1","block_type":"box","text":"expected that the Subsidiary will be subject to an entity-level federal tax.","page_number":178,"box":{"x":69,"y":612,"width":515,"height":11}},{"id":"a70b5b6a-5bf6-4aaa-9f97-f9af010defff","block_type":"box","text":"If a Fund purchases shares of an investment company (or similar investment entity) organized under foreign law,","page_number":178,"box":{"x":102,"y":634,"width":798,"height":12}},{"id":"ed155f2a-ca4f-40a1-a6ef-dbd3296bfe09","block_type":"box","text":"the Fund will generally be treated as owning shares in a passive foreign investment company (“PFIC”) for U.S. federal","page_number":178,"box":{"x":68,"y":649,"width":835,"height":12}},{"id":"477cce4c-8960-42f2-81fa-7261e68bd69e","block_type":"box","text":"income tax purposes. A Fund may be subject to U.S. federal income tax, and interest charges (at the rate applicable","page_number":178,"box":{"x":70,"y":664,"width":827,"height":12}},{"id":"b304aa98-b6a1-4ef1-8491-af6156a86cf1","block_type":"box","text":"to tax underpayments) on tax liability treated as having been deferred with respect to cer tain distributions from such","page_number":178,"box":{"x":68,"y":680,"width":830,"height":11}},{"id":"7d20a87c-6de7-4ddc-b96d-2427e739eb60","block_type":"box","text":"a company and on gain from the disposition of the shares of such a company (collectively referred to as “excess","page_number":178,"box":{"x":69,"y":695,"width":802,"height":11}},{"id":"419ae048-5c2e-4182-b30b-801a277ec041","block_type":"box","text":"distributions”), even if such excess distributions are paid by the Fund as a dividend to its shareholders. However, a","page_number":178,"box":{"x":69,"y":710,"width":821,"height":11}},{"id":"1e91c8f7-7f29-4181-97f9-c3ec74ab4775","block_type":"box","text":"Fund may elect to “mark-to-market” at the end of each taxable year shares that it holds in PFICs. The election is","page_number":178,"box":{"x":70,"y":725,"width":797,"height":11}},{"id":"a51c0fea-9f22-4492-91c7-a75b45650b0e","block_type":"box","text":"made separately for each PFIC held and, once made, would be effective for all subsequent taxable years, unless","page_number":178,"box":{"x":69,"y":740,"width":801,"height":11}},{"id":"84f10e77-f33c-4708-b766-c1adfb92a2c4","block_type":"box","text":"revoked with consent from the IRS. Under this election, a Fund would recognize as ordinary income any increase in","page_number":178,"box":{"x":69,"y":755,"width":818,"height":11}},{"id":"1787ccdd-e8cb-4d90-9a45-4efc9662f7e6","block_type":"box","text":"the value of its shares as of the close of the taxable year over their adjusted tax basis and as ordinary loss any","page_number":178,"box":{"x":68,"y":770,"width":797,"height":11}},{"id":"34b8f721-8879-4dd5-b3c0-2ddced0fa04f","block_type":"box","text":"decrease in such value, but only to the extent of previously recognized “mark-to-market” gains. By making the mark","page_number":178,"box":{"x":69,"y":785,"width":824,"height":12}},{"id":"ee456879-1cf3-4140-95c3-98a83245ea0a","block_type":"box","text":"to-market election, a Fund could avoid imposition of the interest charge with respect to excess distributions from","page_number":178,"box":{"x":68,"y":801,"width":804,"height":11}},{"id":"ca86ad8b-74c9-4e1e-abda-2fc3d5edc9fb","block_type":"box","text":"PFICs, but in any par ticular year might be required to recognize income in excess of the distributions it received from","page_number":178,"box":{"x":69,"y":816,"width":831,"height":11}},{"id":"7e2de7e4-7def-4faa-8558-3f1706851963","block_type":"box","text":"PFICs.","page_number":178,"box":{"x":69,"y":831,"width":42,"height":9}},{"id":"ea7fc2b6-05d2-400c-83d4-dcab4da3cd6f","block_type":"box","text":"If a Fund were to invest in a PFIC and elect to treat the PFIC as a “qualified electing fund” under the Code, in lieu","page_number":178,"box":{"x":102,"y":853,"width":804,"height":12}},{"id":"c4f09968-243d-43ee-9dff-93fb7a4c5028","block_type":"box","text":"of the foregoing requirements, the Fund would be required to include in income each year a por tion of the ordinary","page_number":178,"box":{"x":69,"y":869,"width":816,"height":11}},{"id":"e5a933b8-98f0-403f-9a3d-6686617a4b3a","block_type":"box","text":"earnings and net capital gains of the qualified electing fund, even if not distributed to the Fund, and such amounts","page_number":178,"box":{"x":69,"y":884,"width":816,"height":11}},{"id":"3f257ce3-6d61-423a-92bf-ef79dd708ec2","block_type":"box","text":"would be subject to the 90% and excise tax distribution requirements described above. In order to make this election,","page_number":178,"box":{"x":68,"y":899,"width":840,"height":11}},{"id":"cb044c40-bfb0-4e0f-ae5c-30c1e9a14d26","block_type":"box","text":"II-134","page_number":178,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"1c95e886-672a-42f0-90db-67758d9364de","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":178,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"00e61d41-a7be-468c-8d5e-f55b1cac6588","block_type":"box","text":"the Fund would be required to obtain cer tain annual information from the PFICs in which it invests, which may be","page_number":179,"box":{"x":68,"y":45,"width":804,"height":11}},{"id":"e84629d3-1cd5-4bca-96fe-97bdd359471e","block_type":"box","text":"difficult or impossible to obtain.","page_number":179,"box":{"x":69,"y":60,"width":225,"height":11}},{"id":"d16cee9c-a526-41d2-81aa-f126a1417a01","block_type":"box","text":"In cer tain situations, a Fund may, for a taxable year, defer all or a por tion of its net capital loss (or if there is no","page_number":179,"box":{"x":102,"y":82,"width":796,"height":12}},{"id":"f838fb63-c6f5-4d40-8009-84bd8794b0a8","block_type":"box","text":"net capital loss, any net long-term or shor t-term capital loss) realized after October and its late-year ordinary loss","page_number":179,"box":{"x":69,"y":98,"width":806,"height":11}},{"id":"dce0ad10-e2ef-4516-af4f-1733a130ac06","block_type":"box","text":"(defined as the sum of the excess of post-October foreign currency and PFIC losses over post-October foreign","page_number":179,"box":{"x":69,"y":113,"width":778,"height":11}},{"id":"52a72ae6-b784-42c4-a737-379c93d5a0c1","block_type":"box","text":"currency and PFIC gains plus the excess of post-December ordinary losses over post-December ordinary income) until","page_number":179,"box":{"x":69,"y":128,"width":838,"height":11}},{"id":"f38dca01-e6b3-43c6-9ade-74d4ed24b488","block_type":"box","text":"the next taxable year in computing its investment company taxable income and net capital gain, which will defer the","page_number":179,"box":{"x":68,"y":143,"width":824,"height":11}},{"id":"06ea9d70-b2b7-4743-8fcc-c4d9859989e6","block_type":"box","text":"recognition of such realized losses. Such deferrals and other rules regarding gains and losses realized after October","page_number":179,"box":{"x":69,"y":158,"width":830,"height":11}},{"id":"8e75e5a4-54ee-497e-acba-b731c8f628c8","block_type":"box","text":"(or December) may affect the tax character of shareholder distributions.","page_number":179,"box":{"x":69,"y":173,"width":511,"height":11}},{"id":"6a477182-90d4-46d0-9acc-b6df64dcddd4","block_type":"box","text":"Municipal Funds","page_number":179,"box":{"x":102,"y":196,"width":115,"height":11}},{"id":"fef0327f-2ca8-47fb-883a-aac581003fdf","block_type":"box","text":"Each Municipal Fund intends to qualify to pay “exempt-interest dividends” as defined in Section 852(b)(5) of the","page_number":179,"box":{"x":102,"y":218,"width":798,"height":12}},{"id":"6f203919-6589-493b-806a-ecc3556f6d19","block_type":"box","text":"Code. Under such section if, at the close of each quar ter of a Fund’s taxable year, at least 50% of the value of the","page_number":179,"box":{"x":69,"y":234,"width":815,"height":11}},{"id":"2f186a07-3a1d-47ee-9067-b34785d2d4a0","block_type":"box","text":"Fund’s total assets consists of obligations exempt from U.S. federal income tax (“tax-exempt obligations”) under","page_number":179,"box":{"x":70,"y":249,"width":803,"height":11}},{"id":"28eeb808-246c-4003-b32a-4e2572f67746","block_type":"box","text":"Section 103(a) of the Code (relating generally to obligations of a state or local governmental unit), the Fund shall be","page_number":179,"box":{"x":69,"y":264,"width":826,"height":11}},{"id":"8fca7257-9fc5-416d-bba5-dfb87bcf0f8a","block_type":"box","text":"qualified to pay exempt-interest dividends to holders of all outstanding classes of its shares (together the","page_number":179,"box":{"x":69,"y":279,"width":752,"height":11}},{"id":"17eae329-ede2-4080-bde6-8dd3d2ad872b","block_type":"box","text":"“shareholders”). Exempt-interest dividends are dividends or any par t thereof paid by a Fund that are attributable to","page_number":179,"box":{"x":70,"y":294,"width":817,"height":11}},{"id":"57b4248d-9e61-43ed-8c09-44e703dffb48","block_type":"box","text":"interest on tax-exempt obligations and repor ted by the Fund as exempt-interest dividends. A Fund will allocate","page_number":179,"box":{"x":70,"y":309,"width":780,"height":11}},{"id":"c45911b7-fc07-46d4-8a1c-a7b041141978","block_type":"box","text":"interest from tax-exempt obligations (as well as ordinary income, capital gains and tax preference items discussed","page_number":179,"box":{"x":70,"y":324,"width":815,"height":12}},{"id":"b01e6b06-788a-4819-a180-2bf79c2871cf","block_type":"box","text":"below) among the Fund’s shareholders according to a method (that it believes is consistent with the Commission rule","page_number":179,"box":{"x":69,"y":340,"width":839,"height":11}},{"id":"6ac05925-be95-4eae-a18a-3c786a125a90","block_type":"box","text":"permitting the issuance and sale of multiple classes of shares) that is based upon the gross income that is allocable","page_number":179,"box":{"x":70,"y":355,"width":835,"height":11}},{"id":"83f195a3-de4e-42e6-a406-af967e965301","block_type":"box","text":"to each class of shareholders during the taxable year, or such other method as the IRS may prescribe.","page_number":179,"box":{"x":68,"y":370,"width":730,"height":11}},{"id":"36f4702e-d5ff-4aed-b76b-deeb131adde0","block_type":"box","text":"Exempt-interest dividends will be excludable from a shareholder’s gross income for U.S. federal income tax","page_number":179,"box":{"x":102,"y":392,"width":763,"height":12}},{"id":"75f5b60e-bc4e-4ce8-807e-25c7767425d6","block_type":"box","text":"purposes. Exempt-interest dividends are included, however, in determining the por tion, if any, of a person’s social","page_number":179,"box":{"x":70,"y":407,"width":809,"height":12}},{"id":"877ee73d-66e1-4a3f-8cf6-7119ac4c04a8","block_type":"box","text":"security and railroad retirement benefits subject to U.S. federal income taxes. Interest on indebtedness incurred or","page_number":179,"box":{"x":69,"y":423,"width":821,"height":11}},{"id":"a303de74-1134-4684-b9ad-be37d6139056","block_type":"box","text":"continued to purchase or carry shares of a regulated investment company paying exempt-interest dividends, such as","page_number":179,"box":{"x":69,"y":438,"width":831,"height":11}},{"id":"6f04749d-6055-4e11-a1f6-b1f072e17aad","block_type":"box","text":"the Fund, will not be deductible by the investor for U.S. federal income tax purposes to the extent attributable to","page_number":179,"box":{"x":68,"y":453,"width":800,"height":11}},{"id":"07fb1ba1-e716-4d1e-906f-d45e2e9f5a31","block_type":"box","text":"exempt-interest dividends. Shareholders are advised to consult their tax advisors with respect to whether exempt","page_number":179,"box":{"x":69,"y":468,"width":810,"height":11}},{"id":"5e047ee2-ec7e-4520-9eac-5bbcc4a7341b","block_type":"box","text":"interest dividends retain the exclusion under Code Section 103(a) if a shareholder would be treated as a “substantial","page_number":179,"box":{"x":70,"y":483,"width":836,"height":11}},{"id":"bc8d09a3-5fa5-4a9c-8b69-632d36b0f3ff","block_type":"box","text":"user” or “related person” under Code Section 147(a) with respect to proper ty financed with the proceeds of an issue","page_number":179,"box":{"x":69,"y":498,"width":835,"height":11}},{"id":"d3b59048-f091-4de3-adc1-a2301d8a1a1a","block_type":"box","text":"of PABs, if any, held by a Fund.","page_number":179,"box":{"x":69,"y":513,"width":217,"height":11}},{"id":"86b47687-4d79-41b0-ac25-ad2168797111","block_type":"box","text":"Substitute payments received by a Fund representing interest paid on tax-exempt obligations loaned out by the","page_number":179,"box":{"x":102,"y":536,"width":788,"height":11}},{"id":"5c7eff46-ff24-40b2-85bf-efd1944f4451","block_type":"box","text":"Fund will not be considered exempt interest, and distributions by the Fund of such substitute payments will not","page_number":179,"box":{"x":70,"y":551,"width":790,"height":11}},{"id":"2931a750-99e2-45d4-a85c-25b276242503","block_type":"box","text":"constitute exempt-interest dividends.","page_number":179,"box":{"x":69,"y":566,"width":261,"height":11}},{"id":"1e2b57e0-ee2b-4230-b05b-385dfb58d9b6","block_type":"box","text":"Distributions in excess of a Fund’s earnings and profits will first reduce the adjusted tax basis of a holder’s","page_number":179,"box":{"x":102,"y":589,"width":765,"height":11}},{"id":"3b9a452d-9a50-40ea-ae80-beac8a9f46fa","block_type":"box","text":"shares and, after such adjusted tax basis is reduced to zero, will constitute capital gains to such holder (assuming","page_number":179,"box":{"x":69,"y":604,"width":819,"height":11}},{"id":"275d577a-06fd-4cf9-9910-8c3ea048428d","block_type":"box","text":"the shares are held as a capital asset). Any loss upon the sale or exchange of Fund shares held for six months or","page_number":179,"box":{"x":68,"y":619,"width":813,"height":11}},{"id":"0c7520f8-bc73-46d7-ac15-386fd9b52940","block_type":"box","text":"less will be disallowed to the extent of any exempt-interest dividends received by the shareholder. In addition, any","page_number":179,"box":{"x":70,"y":634,"width":809,"height":11}},{"id":"9366f0ac-0bbe-4ef8-8070-e73401621bdc","block_type":"box","text":"such loss that is not disallowed under the rule stated above will be treated as long-term capital loss to the extent of","page_number":179,"box":{"x":69,"y":649,"width":829,"height":12}},{"id":"17a3023a-5901-4367-bf11-e914d375b1d9","block_type":"box","text":"any capital gain dividends received by the shareholder.","page_number":179,"box":{"x":69,"y":665,"width":388,"height":11}},{"id":"ca4ef7bf-f69f-4330-8a9d-6b4ba057a5a4","block_type":"box","text":"All or a por tion of a Fund’s gains from the sale or redemption of tax-exempt obligations purchased at a market","page_number":179,"box":{"x":101,"y":687,"width":787,"height":11}},{"id":"11cec720-423f-4612-ad0d-4d182827b9a6","block_type":"box","text":"discount will be treated as ordinary income rather than capital gain. This rule may increase the amount of ordinary","page_number":179,"box":{"x":69,"y":702,"width":817,"height":12}},{"id":"90c0e439-261e-4280-9b01-8235ed391227","block_type":"box","text":"income dividends received by shareholders.","page_number":179,"box":{"x":70,"y":718,"width":309,"height":11}},{"id":"e203b432-62d5-48a4-ac30-088c243fe291","block_type":"box","text":"Any market discount recognized on a bond is taxable as ordinary income. A market discount bond is a bond","page_number":179,"box":{"x":101,"y":740,"width":766,"height":11}},{"id":"fae18a3a-8107-4037-aa1f-4f5279432a13","block_type":"box","text":"acquired in the secondary market at a price below redemption value or adjusted issue price if issued with original","page_number":179,"box":{"x":69,"y":755,"width":808,"height":11}},{"id":"ce8f8d53-dcca-467e-be4c-424d7b93691f","block_type":"box","text":"issue discount. Absent an election by the Fund to include the market discount in income as it accrues, gain on the","page_number":179,"box":{"x":70,"y":771,"width":815,"height":11}},{"id":"ed5bb337-f661-4d5d-af93-356b6e4fb457","block_type":"box","text":"Fund’s disposition of such an obligation will be treated as ordinary income rather than capital gain to the extent of","page_number":179,"box":{"x":70,"y":785,"width":815,"height":12}},{"id":"5c21467c-1cba-426c-b0fc-e443f3c0b2be","block_type":"box","text":"the accrued market discount.","page_number":179,"box":{"x":68,"y":801,"width":208,"height":9}},{"id":"aac894a0-0cfd-4e02-bb36-88e4f4a06aab","block_type":"box","text":"The Code subjects interest received on cer tain otherwise tax-exempt securities to a federal alternative minimum","page_number":179,"box":{"x":101,"y":823,"width":801,"height":11}},{"id":"6f3121a2-1bc1-4f0c-98fb-4adc208e4b69","block_type":"box","text":"tax. The alternative minimum tax applies to interest received on cer tain “PABs” issued after August 7, 1986. PABs","page_number":179,"box":{"x":68,"y":838,"width":818,"height":12}},{"id":"a54cc4f6-5e56-4018-9dad-6402731a497a","block_type":"box","text":"are bonds that, although tax-exempt, are used for purposes other than those generally per formed by governmental","page_number":179,"box":{"x":69,"y":853,"width":816,"height":12}},{"id":"86518edc-7d86-450e-98b6-407a55c09e2a","block_type":"box","text":"units and that benefit non-governmental entities (","page_number":179,"box":{"x":69,"y":869,"width":351,"height":11}},{"id":"b3092f17-c350-4e63-8792-33223aa7e503","block_type":"box","text":"e.g.","page_number":179,"box":{"x":422,"y":870,"width":24,"height":10}},{"id":"6e278533-d541-4492-8757-78777fc3b947","block_type":"box","text":", bonds used for industrial development or housing purposes).","page_number":179,"box":{"x":449,"y":869,"width":441,"height":11}},{"id":"0a4ec45a-33ff-44f0-b0ec-a13f44fd8adc","block_type":"box","text":"Income received on such bonds is classified as an item of “tax preference,” which could subject cer tain investors in","page_number":179,"box":{"x":70,"y":884,"width":827,"height":11}},{"id":"456392f0-9864-4d7c-870c-329f8b8cd54d","block_type":"box","text":"such bonds, including shareholders of a Fund, to a federal alternative minimum tax. A Fund will purchase such","page_number":179,"box":{"x":69,"y":899,"width":786,"height":11}},{"id":"b674e928-ef2d-440f-b32c-4842bcd0d848","block_type":"box","text":"II-135","page_number":179,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"492e398b-eb62-4762-b2f3-2405e3baedd2","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":179,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"34a22709-e55a-4fda-a4dc-4160996812bd","block_type":"box","text":"“PABs” and will repor t to shareholders after the close of the calendar year the por tion of the Fund’s dividends","page_number":180,"box":{"x":70,"y":45,"width":782,"height":11}},{"id":"d580a742-179a-494b-969d-18ae2699840f","block_type":"box","text":"declared during the year that constitute an item of tax preference for alternative minimum tax purposes.","page_number":180,"box":{"x":69,"y":60,"width":740,"height":11}},{"id":"80bb6933-7468-4118-b108-4962714d6fef","block_type":"box","text":"Each Municipal Fund may engage in interest rate swap transactions. The U.S. federal income tax rules governing","page_number":180,"box":{"x":102,"y":82,"width":802,"height":12}},{"id":"9efbeee6-04e5-4703-8649-9e1fd8989657","block_type":"box","text":"the taxation of interest rate swaps are not entirely clear and may require a Fund to treat payments received under","page_number":180,"box":{"x":68,"y":98,"width":812,"height":11}},{"id":"0f2eebdd-a819-4458-a116-98b9d7c40f85","block_type":"box","text":"such arrangements as ordinary income and to amor tize payments made under cer tain circumstances. Because","page_number":180,"box":{"x":69,"y":113,"width":794,"height":11}},{"id":"25b8d6dc-e51c-4806-9ea6-1a8773fadb60","block_type":"box","text":"payments received by a Fund in connection with swap transactions will be taxable rather than tax-exempt and","page_number":180,"box":{"x":70,"y":128,"width":776,"height":11}},{"id":"044b5db6-7ccb-43c7-9012-bd3e48814c99","block_type":"box","text":"because swap payments made by a Fund will offset both taxable and tax-exempt gross income propor tionately, they","page_number":180,"box":{"x":69,"y":143,"width":826,"height":11}},{"id":"df1d86c7-2fce-42e1-9fad-17aaa36c806c","block_type":"box","text":"may result in increased taxable distributions to shareholders.","page_number":180,"box":{"x":69,"y":158,"width":436,"height":11}},{"id":"236ccb07-ddd9-430d-80bb-236cd9e9afb9","block_type":"box","text":"Please see Par t I of your Fund’s SAI for cer tain state tax information relevant to an investment in BlackRock","page_number":180,"box":{"x":102,"y":181,"width":771,"height":11}},{"id":"2d999aad-1c31-4b43-92de-56040dd25ad5","block_type":"box","text":"California Municipal Oppor tunities Fund, BlackRock New Jersey Municipal Bond Fund, BlackRock New York Municipal","page_number":180,"box":{"x":69,"y":196,"width":828,"height":11}},{"id":"388d3fe5-f469-48e1-bd03-e59994eb4fe0","block_type":"box","text":"Oppor tunities Fund and BlackRock Pennsylvania Municipal Bond Fund, as well as information on economic conditions","page_number":180,"box":{"x":69,"y":211,"width":836,"height":11}},{"id":"f690226c-6060-47c1-b196-364e9b10e17b","block_type":"box","text":"within each applicable state.","page_number":180,"box":{"x":68,"y":226,"width":203,"height":11}},{"id":"ea25787d-f41e-4ad5-bbe7-9f2224b15f56","block_type":"box","text":"In the case of a Feeder Fund, such Fund is entitled to look to the underlying assets of the Master Por tfolio in","page_number":180,"box":{"x":102,"y":249,"width":774,"height":11}},{"id":"24eb8d8a-1135-4cec-a41d-f69c4c31e1c9","block_type":"box","text":"which it has invested for purposes of satisfying various qualification requirements of the Code applicable to regulated","page_number":180,"box":{"x":68,"y":264,"width":837,"height":11}},{"id":"c7179513-e819-4e8a-ba64-a99dd422a680","block_type":"box","text":"investment companies. Each Master Por tfolio is classified either as a par tnership or a separate disregarded entity","page_number":180,"box":{"x":70,"y":279,"width":816,"height":11}},{"id":"83d3ef73-8270-42a8-b377-2b7cae00cf45","block_type":"box","text":"(depending on the par ticular Master Por tfolio) for U.S. federal income tax purposes. If applicable tax provisions were","page_number":180,"box":{"x":69,"y":294,"width":830,"height":11}},{"id":"3a8cd1a1-918d-42fc-b367-0a584a60ec55","block_type":"box","text":"to change the classification of a Master Por tfolio, then the Board of Directors of a Feeder Fund would determine, in","page_number":180,"box":{"x":68,"y":309,"width":822,"height":11}},{"id":"fa640bd1-819e-427a-864e-09df7cb5a62c","block_type":"box","text":"its discretion, the appropriate course of action for the Feeder Fund. One possible course of action would be to","page_number":180,"box":{"x":70,"y":324,"width":783,"height":11}},{"id":"ea96ef8a-e44e-427f-bab0-63c4d82fff38","block_type":"box","text":"withdraw the Feeder Fund’s investments from the Master Por tfolio and to retain an investment manager to manage","page_number":180,"box":{"x":68,"y":339,"width":822,"height":12}},{"id":"5f2740b0-11f9-4f3b-8ae7-0dcdc8ba2883","block_type":"box","text":"the Feeder Fund’s assets in accordance with the investment policies applicable to the Feeder Fund.","page_number":180,"box":{"x":68,"y":355,"width":710,"height":11}},{"id":"77678c98-9c4a-43ca-88dc-7c4330f6d77f","block_type":"box","text":"Ordinary income and capital gain dividends may also be subject to state and local taxes. Cer tain states exempt","page_number":180,"box":{"x":102,"y":377,"width":796,"height":12}},{"id":"5e88a6a7-9fa5-4d3c-9620-cf3f8a834deb","block_type":"box","text":"from state income taxation dividends paid by regulated investment companies that are derived from interest on U.S.","page_number":180,"box":{"x":68,"y":392,"width":828,"height":12}},{"id":"a2062c91-899d-411f-8ae8-4b42ea5b9d25","block_type":"box","text":"government obligations. State law varies as to whether dividend income attributable to U.S. government obligations is","page_number":180,"box":{"x":68,"y":408,"width":841,"height":11}},{"id":"554647ac-c13c-4a28-a0b1-d5aa79addb1e","block_type":"box","text":"exempt from state income tax.","page_number":180,"box":{"x":69,"y":423,"width":216,"height":11}},{"id":"a09e49bb-0ee9-40f0-9ecd-6c266d910d18","block_type":"box","text":"Shareholders of each Fund are urged to consult their tax advisers regarding specific questions as to federal,","page_number":180,"box":{"x":102,"y":445,"width":771,"height":12}},{"id":"40b411fd-9dfe-4300-8a3d-b812b08c26f0","block_type":"box","text":"foreign, state or local taxes with respect to their Fund. Foreign investors should consider applicable foreign taxes in","page_number":180,"box":{"x":68,"y":460,"width":823,"height":12}},{"id":"304dd920-d795-4ee7-9e7d-d69046fdacad","block_type":"box","text":"their evaluation of an investment in a Fund.","page_number":180,"box":{"x":68,"y":475,"width":309,"height":9}},{"id":"ae235b31-eb12-4a5c-9bff-d3bcc3223532","block_type":"box","text":"The foregoing general discussion of U.S. federal income tax consequences is based on the Code and the","page_number":180,"box":{"x":101,"y":498,"width":749,"height":11}},{"id":"03a7434e-3107-43ba-81c5-3a97a226a8e3","block_type":"box","text":"regulations issued thereunder as in effect on the date of this SAI. Future legislative or administrative changes or","page_number":180,"box":{"x":69,"y":513,"width":803,"height":12}},{"id":"d771e5e5-08a2-4a05-acae-6cc587ce75f0","block_type":"box","text":"cour t decisions may significantly change the conclusions expressed in this discussion, and any such changes or","page_number":180,"box":{"x":69,"y":528,"width":801,"height":12}},{"id":"4cea2cb4-0e93-4592-a4a2-ba3c8885b10a","block_type":"box","text":"decisions may have a retroactive effect.","page_number":180,"box":{"x":69,"y":543,"width":283,"height":12}},{"id":"bda9e671-0e48-42cc-a1f4-75eab4b25a30","block_type":"box","text":"PERFORMANCE DATA","page_number":180,"box":{"x":403,"y":573,"width":173,"height":10}},{"id":"df8a28c1-e322-43c8-9472-045db46df012","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":180,"box":{"x":102,"y":596,"width":738,"height":11}},{"id":"52701e56-2477-4b6b-92ef-9d9152cc4d56","block_type":"box","text":"applicable, yield and tax-equivalent yield in adver tisements or information furnished to present or prospective","page_number":180,"box":{"x":69,"y":611,"width":779,"height":11}},{"id":"cdf58266-4a2a-4c6b-81a9-49ca7724c228","block_type":"box","text":"shareholders. Total return, yield and tax-equivalent yield each is based on a Fund’s historical per formance and is not","page_number":180,"box":{"x":69,"y":626,"width":833,"height":11}},{"id":"f54738fc-b169-4875-8347-e2ab40a8e2f9","block_type":"box","text":"intended to indicate future per formance. Average annual total return is determined separately for each class of","page_number":180,"box":{"x":70,"y":641,"width":792,"height":11}},{"id":"81283dfb-b986-4c67-aa2f-8cbcf3ede2df","block_type":"box","text":"shares in accordance with a formula specified by the Commission.","page_number":180,"box":{"x":69,"y":656,"width":473,"height":11}},{"id":"0912d3ef-4fe8-4e70-b01d-b1b45fd82774","block_type":"box","text":"Quotations of average annual total return, before tax, for the specified periods are computed by finding the","page_number":180,"box":{"x":102,"y":679,"width":761,"height":11}},{"id":"85f36308-d770-4625-8fde-fc1dbdc8a703","block_type":"box","text":"average annual compounded rates of return (based on net investment income and any realized and unrealized capital","page_number":180,"box":{"x":69,"y":694,"width":836,"height":11}},{"id":"40a5e2a9-5629-423a-8242-67bdb45225b5","block_type":"box","text":"gains or losses on por tfolio investments over such periods) that would equate the initial amount invested to the","page_number":180,"box":{"x":68,"y":709,"width":798,"height":11}},{"id":"109b5696-bfb4-4484-906b-5ba98f531698","block_type":"box","text":"redeemable value of such investment at the end of each period. Average annual total return before taxes is","page_number":180,"box":{"x":69,"y":724,"width":765,"height":12}},{"id":"f56d2cd9-8abf-43aa-a2d3-ce99bad9567f","block_type":"box","text":"computed assuming all dividends are reinvested and taking into account all applicable recurring and nonrecurring","page_number":180,"box":{"x":69,"y":740,"width":808,"height":11}},{"id":"ac644fdb-2ca7-4541-af52-f3f002b28842","block_type":"box","text":"expenses, including the maximum sales charge, in the case of front-end load shares, and the CDSC that would be","page_number":180,"box":{"x":69,"y":755,"width":813,"height":11}},{"id":"f87ce035-b5d0-4748-a6dc-471f9d923c35","block_type":"box","text":"applicable to a complete redemption of the investment at the end of the specified period in the case of CDSC shares,","page_number":180,"box":{"x":69,"y":770,"width":839,"height":11}},{"id":"d2548a10-9da9-4923-995e-82a3e882f1a7","block_type":"box","text":"but does not take into account taxes payable on dividends or on redemption.","page_number":180,"box":{"x":69,"y":785,"width":546,"height":11}},{"id":"e3b6315b-db31-404e-badd-d1e0f6390e3f","block_type":"box","text":"Quotations of average annual total return, after taxes, on dividends for the specified periods are computed by","page_number":180,"box":{"x":102,"y":807,"width":781,"height":12}},{"id":"bf471448-4786-433c-803b-cae9f66d2c05","block_type":"box","text":"finding the average annual compounded rates of return that would equate the initial amount invested to the ending","page_number":180,"box":{"x":68,"y":823,"width":819,"height":11}},{"id":"8c448408-bf6c-40f1-bdc3-83696e232505","block_type":"box","text":"value of such investment at the end of each period assuming payment of taxes on dividends received during such","page_number":180,"box":{"x":68,"y":838,"width":810,"height":11}},{"id":"d2088821-12f6-4ddf-83e3-28d6af434a84","block_type":"box","text":"period. Average annual total return after taxes on dividends is computed assuming all dividends, less the taxes due","page_number":180,"box":{"x":70,"y":853,"width":823,"height":11}},{"id":"bfb0fcc5-6c30-4503-b6cb-891effa7fbd3","block_type":"box","text":"on such dividends, are reinvested and taking into account all applicable recurring and nonrecurring expenses,","page_number":180,"box":{"x":69,"y":868,"width":780,"height":11}},{"id":"1c29e01e-4210-47f0-9c79-f9bb409eedb5","block_type":"box","text":"including the maximum sales charge, in the case of front-end load shares and the CDSC that would be applicable to","page_number":180,"box":{"x":70,"y":883,"width":825,"height":11}},{"id":"7dcca46c-e13d-4567-b573-507c68159be2","block_type":"box","text":"a complete redemption of the investment at the end of the specified period in the case of CDSC shares. The taxes","page_number":180,"box":{"x":69,"y":898,"width":817,"height":11}},{"id":"d77824a2-74a1-4e19-a437-2ab4cbadf6d6","block_type":"box","text":"II-136","page_number":180,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"4d2b607e-2874-4d60-b339-9c0651a60523","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":180,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"fbbfa40f-21fb-4ec7-b606-b41033ca12d8","block_type":"box","text":"due on dividends are calculated by applying to each dividend the highest applicable marginal U.S. federal individual","page_number":181,"box":{"x":69,"y":45,"width":820,"height":11}},{"id":"a260da6e-2368-4c18-8c82-c4b9fce978a4","block_type":"box","text":"income tax rates in effect on the reinvestment date for that dividend. The rates used correspond to the tax character","page_number":181,"box":{"x":70,"y":60,"width":833,"height":11}},{"id":"309a63dc-dda9-4c23-ab19-575605e1fc49","block_type":"box","text":"(including eligibility for the maximum 20% tax rate applicable to qualified dividend income) of each dividend. The","page_number":181,"box":{"x":69,"y":75,"width":797,"height":11}},{"id":"a0dec976-0c9b-45c0-b93e-b4398e2bb529","block_type":"box","text":"taxable amount and tax character of each dividend are specified by each Fund on the dividend declaration date, but","page_number":181,"box":{"x":68,"y":90,"width":824,"height":11}},{"id":"1c89356b-709f-4527-ae69-e0215d595fc2","block_type":"box","text":"may be adjusted to reflect subsequent recharacterizations of distributions. The applicable tax rates may vary over the","page_number":181,"box":{"x":69,"y":105,"width":837,"height":11}},{"id":"0622957f-a289-4987-907d-a1f96d64a52e","block_type":"box","text":"measurement period. The effects of state and local taxes are not reflected. Applicable tax credits, such as foreign","page_number":181,"box":{"x":69,"y":120,"width":814,"height":12}},{"id":"dfe516b3-4e3b-4da0-a62d-8902aea1ef9d","block_type":"box","text":"credits, are taken into account according to U.S. federal tax law. The ending value is determined assuming complete","page_number":181,"box":{"x":69,"y":135,"width":830,"height":12}},{"id":"5fb0421f-9c53-466b-bd50-d786552078bd","block_type":"box","text":"redemption at the end of the applicable periods with no tax consequences associated with such redemption.","page_number":181,"box":{"x":69,"y":150,"width":774,"height":11}},{"id":"78e4b5d5-36b5-4d4e-a203-1885f407d897","block_type":"box","text":"Quotations of average annual total return, after taxes, on both dividends and redemption for the specified","page_number":181,"box":{"x":102,"y":173,"width":752,"height":11}},{"id":"6a1e356f-b4e1-4ee1-bbe6-eb5ce53c2202","block_type":"box","text":"periods are computed by finding the average annual compounded rates of return that would equate the initial amount","page_number":181,"box":{"x":70,"y":188,"width":835,"height":12}},{"id":"c0b6a854-7b7a-45ef-afbc-35feb54a9fa8","block_type":"box","text":"invested to the ending value of such investment at the end of each period assuming payment of taxes on dividends","page_number":181,"box":{"x":70,"y":203,"width":820,"height":12}},{"id":"d7a6be7b-5ecf-4e10-9988-a16a0225987f","block_type":"box","text":"received during such period as well as on complete redemption. Average annual total return after taxes on","page_number":181,"box":{"x":69,"y":218,"width":756,"height":12}},{"id":"257c988c-10eb-4525-9389-a3c4d4d5a8c2","block_type":"box","text":"distributions and redemption is computed assuming all dividends, less the taxes due on such dividends, are","page_number":181,"box":{"x":69,"y":234,"width":772,"height":11}},{"id":"fa7e3828-2bcb-478e-a594-b362d755a16a","block_type":"box","text":"reinvested and taking into account all applicable recurring and nonrecurring expenses, including the maximum sales","page_number":181,"box":{"x":69,"y":249,"width":827,"height":11}},{"id":"7867b1a4-ed89-4c81-a94c-aaabcb5f26cd","block_type":"box","text":"charge in the case of front-end load shares and the CDSC that would be applicable to a complete redemption of the","page_number":181,"box":{"x":69,"y":264,"width":825,"height":11}},{"id":"38e7efbf-1055-4193-b407-e2d1ebd2f361","block_type":"box","text":"investment at the end of the specified period in the case of CDSC shares and assuming, for all classes of shares,","page_number":181,"box":{"x":70,"y":279,"width":812,"height":11}},{"id":"712dc9f1-af50-4e59-b3b1-daa25ed52262","block_type":"box","text":"complete redemption and payment of taxes due on such redemption. The ending value is determined assuming","page_number":181,"box":{"x":69,"y":294,"width":795,"height":11}},{"id":"194e39af-95a7-4beb-977e-f13947b811cb","block_type":"box","text":"complete redemption at the end of the applicable periods, subtracting capital gains taxes resulting from the","page_number":181,"box":{"x":69,"y":309,"width":768,"height":11}},{"id":"7c717009-3c9f-43c3-906c-6329b0b96158","block_type":"box","text":"redemption and adding the presumed tax benefit from capital losses resulting from redemption. The taxes due on","page_number":181,"box":{"x":69,"y":324,"width":810,"height":12}},{"id":"aca92e9c-cfcb-4924-968d-b6335c654b89","block_type":"box","text":"dividends and on the deemed redemption are calculated by applying the highest applicable marginal U.S. federal","page_number":181,"box":{"x":69,"y":339,"width":802,"height":12}},{"id":"542b40a1-02f1-4a07-b687-7330bf2cdeae","block_type":"box","text":"individual income tax rates in effect on the reinvestment and/or the redemption date. The rates used correspond to","page_number":181,"box":{"x":70,"y":355,"width":825,"height":11}},{"id":"57810edc-3ad7-4c8d-90d0-58955cf38ed9","block_type":"box","text":"the tax character (including eligibility for the maximum 20% tax rate applicable to qualified dividend income) of each","page_number":181,"box":{"x":68,"y":370,"width":823,"height":11}},{"id":"36ebc41e-ac89-463f-b144-56b582f08dc0","block_type":"box","text":"component of each dividend and/or the redemption payment. The applicable tax rates may vary over the","page_number":181,"box":{"x":69,"y":385,"width":743,"height":11}},{"id":"e779fa8f-af47-4bb8-a64d-02f989b26c62","block_type":"box","text":"measurement period. The effects of state and local taxes are not reflected. Applicable tax credits, such as foreign","page_number":181,"box":{"x":69,"y":400,"width":814,"height":11}},{"id":"cd56840c-76fd-4b22-b7e1-06a988dea703","block_type":"box","text":"tax credits, are taken into account according to federal law.","page_number":181,"box":{"x":68,"y":415,"width":422,"height":11}},{"id":"71793a33-86ae-465f-a3df-81add9eac18e","block_type":"box","text":"A Fund also may quote annual, average annual and annualized total return and aggregate total return","page_number":181,"box":{"x":101,"y":438,"width":720,"height":11}},{"id":"f8fed451-d8e9-4ba2-b3c2-ab0aa4042f37","block_type":"box","text":"per formance data, both as a percentage and as a dollar amount based on a hypothetical investment of $1,000 or","page_number":181,"box":{"x":70,"y":452,"width":813,"height":12}},{"id":"c91f5c4e-8cc6-4af1-97ff-45560c079484","block_type":"box","text":"some other amount, for various periods other than those noted in Par t I of each Fund’s SAI. Such data will be","page_number":181,"box":{"x":69,"y":468,"width":781,"height":11}},{"id":"366c9318-6e75-456b-a262-71fdb489b51e","block_type":"box","text":"computed as described above, except that (1) as required by the periods of the quotations, actual annual, annualized","page_number":181,"box":{"x":69,"y":483,"width":837,"height":11}},{"id":"af257015-43e0-4aae-b066-513004511f2e","block_type":"box","text":"or aggregate data, rather than average annual data, may be quoted and (2) the maximum applicable sales charges","page_number":181,"box":{"x":69,"y":498,"width":817,"height":11}},{"id":"23e4a5b9-03b2-4e84-b54c-1d7e0d67b0c2","block_type":"box","text":"will not be included with respect to annual or annualized rates of return calculations. Aside from the impact on the","page_number":181,"box":{"x":68,"y":513,"width":815,"height":11}},{"id":"dc82425b-263c-44aa-ba77-d42cec9dad38","block_type":"box","text":"per formance data calculations of including or excluding the maximum applicable sales charges, actual annual or","page_number":181,"box":{"x":70,"y":528,"width":801,"height":12}},{"id":"fed11239-9a0e-45e9-b415-563196deb84b","block_type":"box","text":"annualized total return data generally will be lower than average annual total return data since the average rates of","page_number":181,"box":{"x":69,"y":543,"width":819,"height":12}},{"id":"556de16a-b66a-4e8a-9367-428f37563950","block_type":"box","text":"return reflect compounding of return; aggregate total return data generally will be higher than average annual total","page_number":181,"box":{"x":69,"y":559,"width":811,"height":11}},{"id":"08f48b83-e086-435b-aa74-84b41d3c7901","block_type":"box","text":"return data since the aggregate rates of return reflect compounding over a longer period of time.","page_number":181,"box":{"x":69,"y":574,"width":686,"height":11}},{"id":"356ad4fe-c63e-4f33-aa2c-150506cb37fe","block_type":"box","text":"Yield quotations will be computed based on a 30-day period by dividing (a) the net income based on the yield of","page_number":181,"box":{"x":101,"y":596,"width":796,"height":12}},{"id":"bee850c9-4726-4941-91e1-d08b196dddd1","block_type":"box","text":"each security earned during the period by (b) the average daily number of shares outstanding during the period that","page_number":181,"box":{"x":69,"y":612,"width":821,"height":11}},{"id":"0ab1bf19-3638-43c2-8434-03b646704acf","block_type":"box","text":"were entitled to receive dividends multiplied by the maximum offering price per share on the last day of the period.","page_number":181,"box":{"x":68,"y":627,"width":817,"height":11}},{"id":"a13b8f8b-cec0-4fbe-a0af-e9e9482dcff2","block_type":"box","text":"Tax equivalent yield quotations will be computed by dividing (a) the par t of a Fund’s yield that is tax-exempt by (b) one","page_number":181,"box":{"x":68,"y":642,"width":837,"height":11}},{"id":"8b287301-4d1a-4878-bb4d-c991b6da9395","block_type":"box","text":"minus a stated tax rate and adding the result to that par t, if any, of the Fund’s yield that is not tax-exempt.","page_number":181,"box":{"x":69,"y":657,"width":759,"height":11}},{"id":"f0707dc4-2e03-4d6d-857a-5b5956894cc7","block_type":"box","text":"A Fund’s total return will vary depending on market conditions, the securities comprising a Fund’s por tfolio, a","page_number":181,"box":{"x":101,"y":680,"width":779,"height":11}},{"id":"1fe11d16-9589-4a20-9980-5e9e5d1ad1f5","block_type":"box","text":"Fund’s operating expenses and the amount of realized and unrealized net capital gains or losses during the period.","page_number":181,"box":{"x":70,"y":695,"width":819,"height":11}},{"id":"f721fd05-feb1-4a15-a8b3-a3b35d1e596d","block_type":"box","text":"The value of an investment in a Fund will fluctuate and an investor’s shares, when redeemed, may be wor th more or","page_number":181,"box":{"x":68,"y":710,"width":830,"height":11}},{"id":"e66856ea-11aa-4da7-94ee-d33680534d3c","block_type":"box","text":"less than their original cost.","page_number":181,"box":{"x":70,"y":725,"width":196,"height":11}},{"id":"71bf61c9-a232-4442-8e99-dbc34791af74","block_type":"box","text":"In order to reflect the reduced sales charges in the case of front-end load shares or the waiver of the CDSC in","page_number":181,"box":{"x":102,"y":748,"width":782,"height":11}},{"id":"9050aab6-e977-4e59-82a3-2007d3c4cbdd","block_type":"box","text":"the case of CDSC shares applicable to cer tain investors, as described under “Purchase of Shares” and “Redemption","page_number":181,"box":{"x":68,"y":763,"width":836,"height":11}},{"id":"e85d27d0-e1d6-48aa-b760-0dda138c0cb4","block_type":"box","text":"of Shares,” respectively, the total return data quoted by a Fund in adver tisements directed to such investors may","page_number":181,"box":{"x":69,"y":778,"width":807,"height":11}},{"id":"9a5c663e-943e-4691-9f40-180884dae717","block_type":"box","text":"take into account the reduced, and not the maximum, sales charge or may take into account the CDSC waiver and,","page_number":181,"box":{"x":68,"y":793,"width":820,"height":11}},{"id":"1a2ee225-196e-4ae7-ac81-42b6a8d442b6","block_type":"box","text":"therefore, may reflect greater total return since, due to the reduced sales charges or the waiver of sales charges, a","page_number":181,"box":{"x":68,"y":808,"width":824,"height":11}},{"id":"5e254843-e1c5-473a-bd90-82c0d2cd7226","block_type":"box","text":"lower amount of expenses is deducted.","page_number":181,"box":{"x":70,"y":823,"width":278,"height":11}},{"id":"f742bb0b-1405-4c6d-a716-87ed6a3f1b5c","block_type":"box","text":"On occasion, a Fund may compare its per formance to, among other things, the Fund’s benchmark index","page_number":181,"box":{"x":102,"y":846,"width":741,"height":11}},{"id":"0c101840-352b-4cdc-999f-dcf69b47643e","block_type":"box","text":"indicated in the Prospectus, the Value Line Composite Index, the Dow Jones Industrial Average, or to other published","page_number":181,"box":{"x":70,"y":861,"width":830,"height":11}},{"id":"d957b2bb-98d9-43f8-80d8-00b2ff2c9cb2","block_type":"box","text":"indices, or to per formance data published by Lipper Inc., Morningstar, Inc. (“Morningstar”),","page_number":181,"box":{"x":70,"y":876,"width":646,"height":11}},{"id":"25e54972-f0e8-4f56-a211-ea7f4354f7c3","block_type":"box","text":"Money Magazine, U.S.","page_number":181,"box":{"x":724,"y":876,"width":156,"height":11}},{"id":"72fa0a0c-99c0-4707-9dfc-0b867040a75d","block_type":"box","text":"News & World Repor t, BusinessWeek, Forbes Magazine, For tune Magazine","page_number":181,"box":{"x":70,"y":891,"width":533,"height":12}},{"id":"1c72d97c-251d-4af9-b4b7-2dfa20e2aa41","block_type":"box","text":"or other industry publications. When","page_number":181,"box":{"x":608,"y":891,"width":257,"height":11}},{"id":"28da2d25-bef5-4531-bda9-02ab11bd2ccd","block_type":"box","text":"comparing its per formance to a market index, a Fund may refer to various statistical measures derived from the","page_number":181,"box":{"x":69,"y":906,"width":797,"height":12}},{"id":"1c655ee6-3601-49ab-b6ed-bc1d8af29be9","block_type":"box","text":"II-137","page_number":181,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"6ee93c7e-b773-46e6-aa07-198d23c3776b","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":181,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"33237179-070f-4874-a18d-eb87eb0d2e5b","block_type":"box","text":"historical per formance of a Fund and the index, such as standard deviation and beta. As with other per formance","page_number":182,"box":{"x":69,"y":45,"width":803,"height":11}},{"id":"0bcab93d-4a0b-48af-b39a-3ce5b348a300","block_type":"box","text":"data, per formance comparisons should not be considered indicative of a Fund’s relative per formance for any future","page_number":182,"box":{"x":69,"y":60,"width":824,"height":11}},{"id":"a77833d7-5a9e-4769-afb4-47b5a43d7d9b","block_type":"box","text":"period. In addition, from time to time a Fund may include the Fund’s Morningstar risk-adjusted per formance ratings","page_number":182,"box":{"x":70,"y":75,"width":818,"height":11}},{"id":"355e96c4-ca36-46ee-a74f-557d1a0e8c5e","block_type":"box","text":"assigned by Morningstar in adver tising or supplemental sales literature. From time to time a Fund may quote in","page_number":182,"box":{"x":69,"y":90,"width":793,"height":11}},{"id":"ffda6076-6fd5-4506-81c0-8b5885c4ed70","block_type":"box","text":"adver tisements or other materials other applicable measures of Fund per formance and may also make reference to","page_number":182,"box":{"x":69,"y":105,"width":826,"height":11}},{"id":"d07dfcdb-5d58-4944-aba4-c9b1b7c175f2","block_type":"box","text":"awards that may be given to the Manager. Cer tain Funds may also compare their per formance to composite indices","page_number":182,"box":{"x":69,"y":120,"width":825,"height":12}},{"id":"7423971e-d917-4bdf-8f42-e80417e4e06f","block_type":"box","text":"developed by Fund management.","page_number":182,"box":{"x":69,"y":136,"width":233,"height":11}},{"id":"27454c44-b49c-4b0a-857d-866404c75c20","block_type":"box","text":"A Fund may provide information designed to help investors understand how the Fund is seeking to achieve its","page_number":182,"box":{"x":101,"y":158,"width":780,"height":11}},{"id":"780de8a0-a864-4195-ac55-8fdadd6abc81","block_type":"box","text":"investment objectives. This may include information about past, current or possible economic, market, political or","page_number":182,"box":{"x":70,"y":173,"width":810,"height":11}},{"id":"1e70d765-8253-4c24-b806-ce496f306ab0","block_type":"box","text":"other conditions, descriptive information or general principles of investing such as asset allocation, diversification","page_number":182,"box":{"x":69,"y":188,"width":810,"height":12}},{"id":"4f41c75d-e40b-485b-a516-d6d3090e436b","block_type":"box","text":"and risk tolerance, discussion of a Fund’s por tfolio composition, investment philosophy, strategy or investment","page_number":182,"box":{"x":69,"y":203,"width":792,"height":12}},{"id":"aba83665-e094-4c50-a7c6-46fdcdb88437","block_type":"box","text":"techniques, comparisons of the Fund’s per formance or por tfolio composition to that of other funds or types of","page_number":182,"box":{"x":68,"y":218,"width":788,"height":12}},{"id":"df619ac1-7a8f-4cd2-9f2c-b1e88fe47764","block_type":"box","text":"investments, indices relevant to the comparison being made, or to a hypothetical or model por tfolio. A Fund may also","page_number":182,"box":{"x":70,"y":234,"width":835,"height":11}},{"id":"06a6df1a-3454-4545-8efa-aea04bceb139","block_type":"box","text":"quote various measures of volatility and benchmark correlation in adver tising and other materials, and may compare","page_number":182,"box":{"x":69,"y":249,"width":830,"height":11}},{"id":"fea7e922-de8f-4335-b01b-e853a01db8a4","block_type":"box","text":"these measures to those of other funds or types of investments.","page_number":182,"box":{"x":68,"y":264,"width":461,"height":11}},{"id":"b904f2f6-43f0-45f3-9931-5bb44bc2eb22","block_type":"box","text":"PROXY VOTING POLICIES AND PROCEDURES","page_number":182,"box":{"x":308,"y":293,"width":362,"height":10}},{"id":"07ae8d41-c573-4bbc-83fb-1dabcc61ead0","block_type":"box","text":"The Board of Directors of the Funds has delegated the voting of proxies for the Funds’ securities to the Manager","page_number":182,"box":{"x":101,"y":316,"width":802,"height":11}},{"id":"aacb5ca7-27e8-43b3-add8-86667f784a8a","block_type":"box","text":"pursuant to (i) the Open-End Active and Fixed Income Index Fund Proxy Voting Policy (the “Active Fund Proxy Voting","page_number":182,"box":{"x":70,"y":331,"width":809,"height":12}},{"id":"7b5c4db0-d04b-47dd-816a-c86d4a74b7f6","block_type":"box","text":"Policy”), with respect to cer tain Funds, and (ii) the Index Equity Fund Proxy Voting Policy, with respect to cer tain other","page_number":182,"box":{"x":69,"y":347,"width":833,"height":11}},{"id":"68bce00f-add2-4e52-a0e1-47d0f780f84a","block_type":"box","text":"Funds, as applicable. Please refer to Par t I of this SAI, which discloses the policy applicable to each Fund.","page_number":182,"box":{"x":70,"y":361,"width":755,"height":12}},{"id":"5013336f-b1b6-49e8-836c-6b6184514256","block_type":"box","text":"With respect to Funds covered by the Active Fund Proxy Voting Policy, the Manager has adopted the BlackRock","page_number":182,"box":{"x":101,"y":384,"width":785,"height":11}},{"id":"c8ca1f58-59ec-4cec-ab02-ad8e9dded6f6","block_type":"box","text":"Active Investment Stewardship—Global Engagement and Voting Guidelines (the “BAIS Guidelines”). Cer tain of such","page_number":182,"box":{"x":68,"y":399,"width":822,"height":12}},{"id":"21a3e683-0ec7-470c-88cf-6a914b4e818f","block_type":"box","text":"Funds, as listed within the Active Fund Proxy Voting Policy and as disclosed in Par t I of this SAI, follow supplemental","page_number":182,"box":{"x":70,"y":414,"width":824,"height":12}},{"id":"773968f4-8f70-49bb-9b0e-989b8a5bd5c8","block_type":"box","text":"guidelines within the BAIS Guidelines that are applicable to cer tain climate and decarbonization issues (the “BAIS","page_number":182,"box":{"x":68,"y":430,"width":812,"height":11}},{"id":"fc1a6d22-44d2-40a8-a640-ba550945bdaf","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines”).","page_number":182,"box":{"x":69,"y":445,"width":392,"height":11}},{"id":"a1a86753-e540-4dda-ae48-4c110705b648","block_type":"box","text":"With respect to Funds covered by the Index Equity Fund Proxy Voting Policy, the Manager has adopted the","page_number":182,"box":{"x":101,"y":468,"width":749,"height":11}},{"id":"51ef1d24-c0cc-423d-aef8-40065eed2c7f","block_type":"box","text":"BlackRock Investment Stewardship (“BIS”) Global Benchmark Policy, comprised of the Global Principles for","page_number":182,"box":{"x":70,"y":482,"width":759,"height":12}},{"id":"4d5e8af3-a44a-434f-b9f0-b114ba6873b7","block_type":"box","text":"Benchmark Policies, regional voting guidelines, and engagement priorities, which are each available upon request. In","page_number":182,"box":{"x":70,"y":498,"width":830,"height":11}},{"id":"f1fb9dbc-f0f3-411c-8240-230bbbbbff4b","block_type":"box","text":"addition, cer tain of such Funds, as listed within the Index Equity Fund Proxy Voting Policy and as disclosed in Par t I of","page_number":182,"box":{"x":69,"y":513,"width":838,"height":11}},{"id":"a476963f-bad3-480c-b2ec-f0d6d0e24603","block_type":"box","text":"this SAI, follow supplemental guidelines that are applicable to cer tain climate and decarbonization issues (the “BIS","page_number":182,"box":{"x":68,"y":528,"width":822,"height":11}},{"id":"c13a88eb-582e-43d3-a55b-13322389c826","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines”).","page_number":182,"box":{"x":69,"y":543,"width":392,"height":11}},{"id":"6737dd4a-64c3-45c2-aedc-c2bc44b08103","block_type":"box","text":"If a Fund invests in an underlying fund managed by BlackRock, the Fund will use its proxy voting policy when","page_number":182,"box":{"x":102,"y":566,"width":767,"height":11}},{"id":"7fa2b160-bc09-4828-9cc2-60e0782beea8","block_type":"box","text":"voting on proxies for the underlying fund while the underlying fund will use its proxy voting policy when voting proxies","page_number":182,"box":{"x":68,"y":581,"width":827,"height":11}},{"id":"7eadd13f-89f1-47c6-8309-fb64e305ff70","block_type":"box","text":"on investments the underlying fund holds. Therefore, the Fund may use the Active Fund Proxy Voting Policy while an","page_number":182,"box":{"x":69,"y":596,"width":819,"height":11}},{"id":"59ee57d2-82eb-4ec1-8eee-f9686dd99c79","block_type":"box","text":"underlying fund may use the Index Equity Fund Proxy Voting Policy, and the opposite is also true.","page_number":182,"box":{"x":69,"y":611,"width":684,"height":11}},{"id":"a84459d8-eda5-4d07-b888-07f018cd0162","block_type":"box","text":"Copies of the Active Fund Proxy Voting Policy, Index Equity Fund Proxy Voting Policy, the BAIS Guidelines, the","page_number":182,"box":{"x":102,"y":634,"width":766,"height":11}},{"id":"392ac2ec-244e-454c-ba69-985693505650","block_type":"box","text":"Global Principles for Benchmark Policies and the BIS Climate and Decarbonization Stewardship Guidelines are","page_number":182,"box":{"x":69,"y":649,"width":784,"height":11}},{"id":"f6a498b5-14e6-465b-99d1-e4a2fa8743e7","block_type":"box","text":"attached as Appendix B to this SAI. Only those guidelines that are applicable to a par ticular Fund pursuant to the","page_number":182,"box":{"x":69,"y":664,"width":805,"height":11}},{"id":"4314e65c-a05e-4ff4-9a12-ad839625b7d2","block_type":"box","text":"Active Fund Proxy Voting Policy or the Index Equity Fund Proxy Voting Policy are considered to form a par t of the","page_number":182,"box":{"x":68,"y":679,"width":790,"height":11}},{"id":"306ec024-21c1-464d-87cc-b204e863365d","block_type":"box","text":"Fund’s SAI. Information on how each Fund voted proxies relating to por tfolio securities during the most recent 12-","page_number":182,"box":{"x":70,"y":694,"width":810,"height":11}},{"id":"b3715965-fa63-4ca4-bc5c-efc9dc938189","block_type":"box","text":"month period ended June 30 is available without charge, (i) at www.blackrock.com/proxyrecords and (ii) on the","page_number":182,"box":{"x":69,"y":709,"width":788,"height":11}},{"id":"60aa03ff-8253-4f5a-b750-3a9856525e95","block_type":"box","text":"Commission’s website at http://www.sec.gov.","page_number":182,"box":{"x":69,"y":724,"width":327,"height":12}},{"id":"6c2d1dd6-42a9-4262-85a2-13d083c03c60","block_type":"box","text":"GENERAL INFORMATION","page_number":182,"box":{"x":391,"y":754,"width":195,"height":10}},{"id":"c22b7798-74d9-4939-ba95-5c7d023170ec","block_type":"box","text":"Description of Shares","page_number":182,"box":{"x":69,"y":784,"width":156,"height":11}},{"id":"42c7d3a0-8cba-4cad-ae19-33f8adf3e567","block_type":"box","text":"Shareholders of a Fund are entitled to one vote for each full share held and fractional votes for fractional shares","page_number":182,"box":{"x":102,"y":807,"width":800,"height":9}},{"id":"74372706-bf19-4746-b03e-4f26d7c0530e","block_type":"box","text":"held in the election of Directors and generally on other matters submitted to the vote of shareholders of the Fund.","page_number":182,"box":{"x":69,"y":822,"width":811,"height":11}},{"id":"198cf853-62fc-40c2-861d-676689692be9","block_type":"box","text":"Shareholders of a class that bears distribution and/or service expenses have exclusive voting rights with respect to","page_number":182,"box":{"x":69,"y":837,"width":825,"height":11}},{"id":"de6edf06-61da-4c9f-9fd0-9fd51bdfeb3f","block_type":"box","text":"matters relating to such distribution and service expenditures. Voting rights are not cumulative, so that the holders of","page_number":182,"box":{"x":69,"y":852,"width":838,"height":11}},{"id":"6ead28b3-b986-4e4b-b4c5-dd550e01d82e","block_type":"box","text":"more than 50% of the shares voting in the election of Directors can, if they choose to do so, elect all the Directors of","page_number":182,"box":{"x":69,"y":867,"width":835,"height":12}},{"id":"37864eb0-2a67-484f-be79-a68006438c78","block_type":"box","text":"a Fund, in which event the holders of the remaining shares would be unable to elect any person as a Director.","page_number":182,"box":{"x":69,"y":882,"width":781,"height":12}},{"id":"67d4d389-b365-440e-814f-a3afd390e34a","block_type":"box","text":"II-138","page_number":182,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"c5ed2135-2af5-4d93-8757-da899311fe14","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":182,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"ef35fd65-285e-4793-a71c-48747d20b0d8","block_type":"box","text":"No Fund intends to hold annual meetings of shareholders in any year in which the Investment Company Act does","page_number":183,"box":{"x":102,"y":45,"width":801,"height":11}},{"id":"69d71f3e-c07c-40fa-906d-e0c66240d3af","block_type":"box","text":"not require shareholders to act upon any of the following matters: (i) election of Directors; (ii) approval of a","page_number":183,"box":{"x":69,"y":60,"width":760,"height":11}},{"id":"0a91b41f-dd67-4670-9730-971250234dce","block_type":"box","text":"management agreement; (iii) approval of a distribution agreement; and (iv) ratification of selection of independent","page_number":183,"box":{"x":69,"y":75,"width":810,"height":11}},{"id":"947ad6b6-6f9c-4587-b4e4-6ff2512699ec","block_type":"box","text":"accountants. Shares issued are fully paid and non-assessable and have no preemptive rights. Redemption and","page_number":183,"box":{"x":69,"y":90,"width":790,"height":11}},{"id":"8993346c-ac2a-4efa-901b-4210a4823d71","block_type":"box","text":"conversion rights are discussed elsewhere herein and in each Fund’s Prospectus. Each share of each class of","page_number":183,"box":{"x":69,"y":105,"width":787,"height":11}},{"id":"d2ff7f9d-6699-49d9-9279-084fd8c78032","block_type":"box","text":"Common Stock is entitled to par ticipate equally in dividends and distributions declared by a Fund and in the net","page_number":183,"box":{"x":69,"y":120,"width":797,"height":11}},{"id":"dcfc74f0-3511-45bb-8433-6fe3dc40f783","block_type":"box","text":"assets of the Fund upon liquidation or dissolution after satisfaction of outstanding liabilities.","page_number":183,"box":{"x":69,"y":135,"width":658,"height":12}},{"id":"ce1e069b-bda9-4287-8af0-3bc84e64032e","block_type":"box","text":"For Funds organized as Maryland corporations, the by-laws of the Fund require that a special meeting of","page_number":183,"box":{"x":102,"y":158,"width":741,"height":11}},{"id":"abfa4c3c-1520-428a-9ca5-01d4c8395ede","block_type":"box","text":"shareholders be held upon the written request of a minimum percentage of the outstanding shares of the Fund","page_number":183,"box":{"x":69,"y":173,"width":790,"height":11}},{"id":"32495346-b780-4d1e-aa95-84ebd004f03d","block_type":"box","text":"entitled to vote at such meeting, if they comply with applicable Maryland law.","page_number":183,"box":{"x":69,"y":188,"width":546,"height":12}},{"id":"2cbd1648-68a1-49b8-99ac-a35c5c4feff8","block_type":"box","text":"Cer tain of the Funds are organized as “Massachusetts business trusts.” Under Massachusetts law,","page_number":183,"box":{"x":102,"y":211,"width":712,"height":11}},{"id":"c17c9ea7-e6cc-4edf-bd25-8533aa3f7cad","block_type":"box","text":"shareholders of such a trust may, under cer tain circumstances, be held personally liable as par tners for its","page_number":183,"box":{"x":69,"y":226,"width":765,"height":11}},{"id":"99a03719-7bcc-4900-a3fa-a02aef3fa775","block_type":"box","text":"obligations. However, the Declaration of Trust establishing a trust, a copy of which for each applicable Fund, together","page_number":183,"box":{"x":69,"y":241,"width":834,"height":11}},{"id":"82571573-472c-4aa4-8556-30217045f1f0","block_type":"box","text":"with all amendments thereto (the “Declaration of Trust”), is on file in the office of the Secretary of the","page_number":183,"box":{"x":68,"y":256,"width":729,"height":11}},{"id":"39f88ee6-cda2-44ff-bbbe-9d466d69a74a","block_type":"box","text":"Commonwealth of Massachusetts, contains an express disclaimer of shareholder liability for acts or obligations of","page_number":183,"box":{"x":69,"y":271,"width":815,"height":12}},{"id":"20e5d6a4-8d0e-479d-85a7-2edf6df82df9","block_type":"box","text":"the trust and provides for indemnification and reimbursement of expenses out of the trust proper ty for any","page_number":183,"box":{"x":68,"y":286,"width":761,"height":12}},{"id":"691fc129-d103-4dba-991c-e00e0e851238","block_type":"box","text":"shareholder held personally liable for the obligations of the trust. The Declaration of Trust also provides that a trust","page_number":183,"box":{"x":69,"y":302,"width":824,"height":11}},{"id":"421bbb3e-8ca0-413e-a7a6-94cca89b1d80","block_type":"box","text":"may maintain appropriate insurance (for example, fidelity bond and errors and omissions insurance) for the protection","page_number":183,"box":{"x":69,"y":317,"width":839,"height":11}},{"id":"8e5df589-13cb-4af1-bae2-0784992d2883","block_type":"box","text":"of the trust, its shareholders, trustees, officers, employees and agents covering possible tor t and other liabilities.","page_number":183,"box":{"x":69,"y":332,"width":813,"height":11}},{"id":"6c4801d9-54dc-4647-85ce-16a967db35d5","block_type":"box","text":"Thus, the risk of a shareholder incurring financial loss on account of shareholder liability is limited to circumstances","page_number":183,"box":{"x":68,"y":347,"width":827,"height":11}},{"id":"97ee9477-760a-4135-a9fc-25a116a58878","block_type":"box","text":"in which both inadequate insurance existed and the trust itself was unable to meet its obligations.","page_number":183,"box":{"x":70,"y":362,"width":699,"height":11}},{"id":"523d05c7-b968-4b1c-86a7-866555e9709c","block_type":"box","text":"Cer tain Funds are organized as Delaware statutory trusts.","page_number":183,"box":{"x":102,"y":385,"width":413,"height":11}},{"id":"00d62eea-2f7e-46ee-bb88-bc4ab749213f","block_type":"box","text":"Additional Information","page_number":183,"box":{"x":68,"y":415,"width":161,"height":9}},{"id":"8d62ab3c-2f39-461b-91cc-ffb54fc78488","block_type":"box","text":"Under a separate agreement, BlackRock has granted cer tain Funds the right to use the “BlackRock” name and","page_number":183,"box":{"x":102,"y":438,"width":789,"height":11}},{"id":"10cf38d9-f3c5-4597-9c0e-f546f5feb696","block_type":"box","text":"has reserved the right to (i) withdraw its consent to the use of such name by a Fund if the Fund ceases to retain","page_number":183,"box":{"x":69,"y":453,"width":799,"height":11}},{"id":"a867b229-2645-4e59-9708-eb2623c40ad0","block_type":"box","text":"BlackRock Advisors, LLC or BlackRock Fund Advisors, as applicable, as investment adviser and (ii) to grant the use of","page_number":183,"box":{"x":70,"y":468,"width":837,"height":11}},{"id":"5c7e2e38-73af-40bd-85c2-a9794d5409a2","block_type":"box","text":"such name to any other company.","page_number":183,"box":{"x":69,"y":483,"width":238,"height":11}},{"id":"21d90738-f89f-460d-bdc7-90dc203e5c9b","block_type":"box","text":"II-139","page_number":183,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"0abcee35-092a-418f-9a8a-9b2da7787e1c","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":183,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"239c4b34-741b-4524-bc6d-22c64a034322","block_type":"box","text":"APPENDIX A","page_number":184,"box":{"x":438,"y":45,"width":101,"height":10}},{"id":"53ff712e-e95a-423e-a69f-8f20799eefaf","block_type":"box","text":"Description of Bond Ratings","page_number":184,"box":{"x":377,"y":68,"width":224,"height":13}},{"id":"ded297cd-9029-493b-9441-4a85c9c85171","block_type":"box","text":"A rating is generally assigned to a fixed-income security at the time of issuance by a credit rating agency","page_number":184,"box":{"x":101,"y":91,"width":743,"height":12}},{"id":"7a39a98b-3e4e-4068-bf2d-f03b20ec10bf","block_type":"box","text":"designated as a nationally recognized statistical rating organization (“NRSRO”) by the SEC. While NRSROs may from","page_number":184,"box":{"x":69,"y":106,"width":827,"height":12}},{"id":"eaee202c-2f0a-467d-bf69-b6ce08d90e6f","block_type":"box","text":"time to time revise such ratings, they under take no obligation to do so, and the ratings given to securities at","page_number":184,"box":{"x":68,"y":122,"width":775,"height":11}},{"id":"7ad4b6f6-0613-479d-9e8e-ffd13337d57b","block_type":"box","text":"issuance do not necessarily represent ratings which would be given to these securities on a par ticular subsequent","page_number":184,"box":{"x":70,"y":137,"width":815,"height":11}},{"id":"52336532-8b62-42af-9baf-ba089c4189b0","block_type":"box","text":"date.","page_number":184,"box":{"x":69,"y":152,"width":34,"height":9}},{"id":"9276dcac-06d4-408c-970a-ff79b4efb576","block_type":"box","text":"NRSROs may rate specific investments (","page_number":184,"box":{"x":102,"y":174,"width":286,"height":12}},{"id":"46a864b8-68f1-46eb-8d97-330d6251fbe8","block_type":"box","text":"e.g.","page_number":184,"box":{"x":390,"y":176,"width":25,"height":10}},{"id":"be0be166-29b5-4dea-a5a6-756d0d036748","block_type":"box","text":", bonds), issuers (","page_number":184,"box":{"x":417,"y":175,"width":128,"height":10}},{"id":"46a05f13-f908-4d6d-93c9-f027ea9cc9cf","block_type":"box","text":"e.g.","page_number":184,"box":{"x":547,"y":176,"width":25,"height":10}},{"id":"c2f6c194-182a-4238-b9da-ee4141540d3c","block_type":"box","text":", corporations, governments and financial","page_number":184,"box":{"x":574,"y":174,"width":293,"height":12}},{"id":"dcbb0ea4-ba85-4f35-bdc1-1e5e98b329fd","block_type":"box","text":"institutions) and/or programs (","page_number":184,"box":{"x":70,"y":190,"width":217,"height":11}},{"id":"40db5af7-ea31-490e-b3fe-38a876c35a57","block_type":"box","text":"e.g.","page_number":184,"box":{"x":289,"y":191,"width":25,"height":10}},{"id":"a4946abc-084f-4295-90b4-055cfc236a5d","block_type":"box","text":", commercial paper programs). However, cer tain types of investments may not be","page_number":184,"box":{"x":317,"y":189,"width":578,"height":12}},{"id":"de724bcb-c3a8-4add-a28a-b117534ebdb6","block_type":"box","text":"rated by NRSROs, such as cer tain government/sovereign obligations, US agency securities, commercial paper, time","page_number":184,"box":{"x":69,"y":205,"width":826,"height":11}},{"id":"2d6146ff-a49f-4223-88b6-c0f9ea78d553","block_type":"box","text":"deposits at financial institutions, and derivative instruments such as credit default swaps. For these types of","page_number":184,"box":{"x":69,"y":220,"width":777,"height":11}},{"id":"38addc12-6db9-4e5a-a9fe-32b8a2620c21","block_type":"box","text":"investments, as well as US Treasury securities (some of which are not rated), where a NRSRO has not rated the","page_number":184,"box":{"x":70,"y":235,"width":798,"height":11}},{"id":"3a656fc1-83b9-4f35-8be7-ef969d2f0950","block_type":"box","text":"specific investment but has rated the investment’s issuer, program, financial institution or underlying reference","page_number":184,"box":{"x":69,"y":250,"width":791,"height":11}},{"id":"4f41d172-dae0-4eb3-a75a-f7853156c4d4","block_type":"box","text":"asset, BlackRock Advisors, LLC, BlackRock Fund Advisors or their respective affiliates (“BlackRock”) may consider","page_number":184,"box":{"x":69,"y":265,"width":816,"height":11}},{"id":"81183961-76a1-486b-95fb-e54da4f49178","block_type":"box","text":"the investment to have the same NRSRO rating as its issuer, program, financial institution or underlying reference","page_number":184,"box":{"x":68,"y":280,"width":812,"height":12}},{"id":"2a13f30b-4653-45a6-81a0-ac17d860f34d","block_type":"box","text":"asset, as applicable. In the case of municipal securities, where one NRSRO provides multiple ratings for the same","page_number":184,"box":{"x":69,"y":295,"width":815,"height":12}},{"id":"462409c8-65e9-447e-aa09-b7fdca600509","block_type":"box","text":"security (","page_number":184,"box":{"x":69,"y":311,"width":63,"height":11}},{"id":"e7133441-0ed5-43ee-a067-0d1224fe01f3","block_type":"box","text":"e.g.","page_number":184,"box":{"x":134,"y":312,"width":25,"height":10}},{"id":"757130b8-6104-4ef5-85b9-6f926cb1a182","block_type":"box","text":", “underlying,” “insured” and/or “enhanced” ratings), BlackRock may consider the security to have the","page_number":184,"box":{"x":161,"y":311,"width":730,"height":11}},{"id":"5fb4e23f-e290-488b-a57a-907031b58936","block_type":"box","text":"highest of the multiple ratings.","page_number":184,"box":{"x":69,"y":326,"width":216,"height":11}},{"id":"effe9f25-42cf-4139-813b-a8d8d10135ea","block_type":"box","text":"New issue securities (regardless of type) may not be rated by a NRSRO at the time of their initial offering.","page_number":184,"box":{"x":102,"y":348,"width":751,"height":12}},{"id":"cc282999-4c03-47de-b9b4-9b88ebc29619","block_type":"box","text":"Preliminary prospectuses or term sheets for new issue securities may include an expected rating for the security (as","page_number":184,"box":{"x":69,"y":363,"width":830,"height":12}},{"id":"bc90741c-9788-40ba-93b2-16db6fade64e","block_type":"box","text":"determined by the underwriter and/or issuer) or a NRSRO rating for the issuer of the security. If applicable, when","page_number":184,"box":{"x":69,"y":378,"width":804,"height":12}},{"id":"dcf50da6-a057-4589-8d43-5661ad9130bb","block_type":"box","text":"deciding whether to purchase a new issue security that has not yet been rated by a NRSRO, BlackRock may attribute","page_number":184,"box":{"x":69,"y":394,"width":831,"height":11}},{"id":"f0f631e8-50a8-46f8-8ea0-1b08d9f2c012","block_type":"box","text":"an expected rating to the security based on: (i) the expected rating of the security set for th in the preliminary","page_number":184,"box":{"x":69,"y":409,"width":777,"height":11}},{"id":"d5799755-bcea-4aed-ab1a-2bb84ab5f435","block_type":"box","text":"prospectus or term sheet for the security; (ii) the NRSRO’s rating for the issuer of the security set for th in the","page_number":184,"box":{"x":70,"y":424,"width":779,"height":11}},{"id":"680f389f-dd75-4062-97dc-27f01e12b54b","block_type":"box","text":"preliminary prospectus or term sheet for the security; or (iii) with respect to asset-backed securities, the rating of a","page_number":184,"box":{"x":70,"y":439,"width":819,"height":11}},{"id":"788b8f5a-64de-4aae-be6b-a1677fb124b2","block_type":"box","text":"prior issuance having a similar structure or the same sponsor.","page_number":184,"box":{"x":70,"y":454,"width":441,"height":11}},{"id":"7f2b4d93-bb7d-4e18-a544-ed1732335efe","block_type":"box","text":"Where the investment objective of a fund is to track the per formance of an index that includes credit ratings","page_number":184,"box":{"x":101,"y":477,"width":771,"height":11}},{"id":"a0ee2bb8-dfb3-4bcb-b0f5-a8d9069399f9","block_type":"box","text":"eligibility criteria as par t of its index methodology, the fund may purchase any security within the index, such security","page_number":184,"box":{"x":69,"y":492,"width":832,"height":11}},{"id":"7d8c3101-1d01-4def-b58a-ae71aec98134","block_type":"box","text":"having been determined by the index provider as meeting its credit ratings eligibility criteria. The credit ratings","page_number":184,"box":{"x":69,"y":507,"width":782,"height":11}},{"id":"1cad909d-98f3-4658-a969-e469397123fd","block_type":"box","text":"practices of an index provider may differ from BlackRock’s practices, as described above. Fur ther, the fund may","page_number":184,"box":{"x":70,"y":522,"width":796,"height":11}},{"id":"9a121503-4818-403f-a036-18da47fc9574","block_type":"box","text":"invest, directly or indirectly, in securities that are not rated by a rating agency or securities with a credit rating that","page_number":184,"box":{"x":70,"y":537,"width":811,"height":12}},{"id":"271cac09-afdf-4092-a622-d73cb207a642","block_type":"box","text":"differs from the credit rating specified in its index methodology in various circumstances, including where a security is","page_number":184,"box":{"x":69,"y":552,"width":840,"height":12}},{"id":"6c29f5ee-c45f-4c5b-9567-8fd3a3f8d55d","block_type":"box","text":"downgraded but not yet removed from an index, following the removal of a security from an index prior to its sale by","page_number":184,"box":{"x":69,"y":567,"width":824,"height":12}},{"id":"d20178bc-0957-49e7-ac2d-d3c60492b063","block_type":"box","text":"the fund or as a result of a corporate action or restructuring affecting an issuer of a security held by the fund.","page_number":184,"box":{"x":68,"y":583,"width":781,"height":11}},{"id":"16217650-838c-42d1-afe1-9425bc9eec8a","block_type":"box","text":"Fixed-income securities which are unrated may expose the investor to risks with respect to capacity to pay","page_number":184,"box":{"x":102,"y":606,"width":756,"height":10}},{"id":"363398ae-0cd1-4fd6-868b-bf9eda1f2a0d","block_type":"box","text":"interest or repay principal which are similar to the risks of lower-rated speculative bonds. Evaluation of these","page_number":184,"box":{"x":70,"y":620,"width":773,"height":12}},{"id":"a76b2e05-8be7-49ea-8057-54f419ae0cd3","block_type":"box","text":"securities is dependent on BlackRock’s judgment, analysis and experience in the evaluation of such securities.","page_number":184,"box":{"x":69,"y":635,"width":791,"height":12}},{"id":"0ab3c469-97ed-4419-b3fe-d061c85960b9","block_type":"box","text":"Investors should note that the assignment of a rating to a security by an NRSRO may not reflect the effect of","page_number":184,"box":{"x":102,"y":658,"width":776,"height":11}},{"id":"1963b0d9-af6e-4142-b05b-2f1d95ccb349","block_type":"box","text":"recent developments on the issuer’s ability to make interest and principal payments or on the likelihood of default.","page_number":184,"box":{"x":69,"y":673,"width":818,"height":11}},{"id":"f3361aa8-1421-4935-ba19-d62cb0c6671e","block_type":"box","text":"Securities deemed to be high yield are rated below Baa3 by Moody’s and below BBB- by S&P Global Ratings and","page_number":184,"box":{"x":102,"y":696,"width":799,"height":11}},{"id":"f1d72ebc-9ed8-4495-8aff-2dcfae0193af","block_type":"box","text":"Fitch.","page_number":184,"box":{"x":70,"y":711,"width":35,"height":9}},{"id":"fe3c76a2-7abb-4d40-8f3d-a5d3ac626a44","block_type":"box","text":"The descriptions below relate to general long-term and shor t-term obligations of an issuer.","page_number":184,"box":{"x":101,"y":734,"width":643,"height":11}},{"id":"9f521824-aa8f-46ef-a85a-6b499e398bcf","block_type":"box","text":"A Description of Moody’s Investors Service, Inc.’s (“Moody’s”) Global Rating Scales","page_number":184,"box":{"x":68,"y":764,"width":616,"height":11}},{"id":"a1427e23-8d45-447d-9e00-28369f21272d","block_type":"box","text":"Ratings assigned on Moody’s global long-term and shor t-term rating scales are forward-looking opinions of the","page_number":184,"box":{"x":102,"y":787,"width":787,"height":11}},{"id":"afaf58f3-37b2-4e61-b054-fcc6cab75529","block_type":"box","text":"relative credit risks of financial obligations issued by non-financial corporates, financial institutions, structured","page_number":184,"box":{"x":69,"y":802,"width":785,"height":11}},{"id":"b6e0539c-7c9b-419d-a002-8057ba473ce5","block_type":"box","text":"finance vehicles, project finance vehicles, and public sector entities. Moody’s defines credit risk as the risk that an","page_number":184,"box":{"x":68,"y":817,"width":820,"height":11}},{"id":"5d9c124a-cada-454a-8c7b-8e7ede6c6e6b","block_type":"box","text":"entity may not meet its contractual financial obligations as they come due and any estimated financial loss in the","page_number":184,"box":{"x":69,"y":832,"width":807,"height":11}},{"id":"ff9bf1c6-21e7-4141-b888-d0c6a7d42f9c","block_type":"box","text":"event of default or impairment. The contractual financial obligations addressed by Moody’s ratings are those that call","page_number":184,"box":{"x":69,"y":847,"width":835,"height":11}},{"id":"aad771b3-55c5-4ec3-ba94-d78687c4ebfe","block_type":"box","text":"for, without regard to enforceability, the payment of an ascer tainable amount, which may vary based upon standard","page_number":184,"box":{"x":68,"y":862,"width":822,"height":12}},{"id":"841f714b-450a-49b1-828e-065d9dc8cc0e","block_type":"box","text":"sources of variation (","page_number":184,"box":{"x":69,"y":877,"width":149,"height":11}},{"id":"86bb43ff-2018-492f-a47c-e4a74c24a372","block_type":"box","text":"e.g.","page_number":184,"box":{"x":220,"y":879,"width":25,"height":10}},{"id":"bf4baf50-9561-4005-b9c2-881e47ae0933","block_type":"box","text":", floating interest rates), by an ascer tainable date. Moody’s rating addresses the issuer’s","page_number":184,"box":{"x":247,"y":877,"width":637,"height":12}},{"id":"1fd591ca-55bc-4562-b811-3e70a3af8768","block_type":"box","text":"ability to obtain cash sufficient to service the obligation, and its willingness to pay. Moody’s ratings do not address","page_number":184,"box":{"x":69,"y":892,"width":820,"height":12}},{"id":"7ad4a776-2aa8-4ec6-b26d-9252f3c7f165","block_type":"box","text":"non-standard sources of variation in the amount of the principal obligation (","page_number":184,"box":{"x":69,"y":908,"width":536,"height":11}},{"id":"83da6581-cee2-4a5e-b6e4-558cf5264e89","block_type":"box","text":"e.g.","page_number":184,"box":{"x":607,"y":909,"width":25,"height":10}},{"id":"0cb5b88f-7449-47cd-9469-446de87d36f5","block_type":"box","text":", equity indexed), absent an express","page_number":184,"box":{"x":634,"y":908,"width":257,"height":11}},{"id":"1c295cd9-b4b7-493d-b877-af0e41a1d282","block_type":"box","text":"A-1","page_number":184,"box":{"x":477,"y":943,"width":24,"height":9}},{"id":"b7fbb893-b28b-4af8-a117-01ce48a2810e","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":184,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"8d0f9b8f-e79d-4290-99ee-c622127139e8","block_type":"box","text":"statement to the contrary in a press release accompanying an initial rating. Long-term ratings are assigned to issuers","page_number":185,"box":{"x":69,"y":45,"width":839,"height":11}},{"id":"e6e6fefc-4bcb-42c1-98ed-9c7e61e80453","block_type":"box","text":"or obligations with an original maturity of one year or more and reflect both on the likelihood of a default or","page_number":185,"box":{"x":69,"y":60,"width":761,"height":11}},{"id":"c12dcd3a-fdde-4f3d-b9bf-8979c3f56068","block_type":"box","text":"impairment on contractual financial obligations and the expected financial loss suffered in the event of default or","page_number":185,"box":{"x":70,"y":75,"width":806,"height":11}},{"id":"ff7bf092-f48b-4d2f-b398-f0ca5f447ba8","block_type":"box","text":"impairment. Shor t-term ratings are assigned for obligations with an original maturity of thir teen months or less and","page_number":185,"box":{"x":70,"y":90,"width":818,"height":11}},{"id":"24c1b3f5-3e66-4acb-bc1c-918bea3268d8","block_type":"box","text":"reflect both on the likelihood of a default or impairment on contractual financial obligations and the expected","page_number":185,"box":{"x":69,"y":105,"width":775,"height":11}},{"id":"c294571c-1f28-4590-ace0-4778dcb525a6","block_type":"box","text":"financial loss suffered in the event of default or impairment. Moody’s issues ratings at the issuer level and","page_number":185,"box":{"x":68,"y":120,"width":764,"height":12}},{"id":"5107b3a2-f885-4c07-999f-54e73c378833","block_type":"box","text":"instrument level on both the long-term scale and the shor t-term scale. Typically, ratings are made publicly available","page_number":185,"box":{"x":70,"y":136,"width":819,"height":11}},{"id":"d245ace4-6e03-47a0-98ad-34572c0d09a8","block_type":"box","text":"although private and unpublished ratings may also be assigned.","page_number":185,"box":{"x":69,"y":151,"width":454,"height":11}},{"id":"02d99859-4828-404e-9d27-f5c4e2a7d3f8","block_type":"box","text":"Moody’s differentiates structured finance ratings from fundamental ratings (","page_number":185,"box":{"x":102,"y":173,"width":542,"height":11}},{"id":"ec687990-3d78-4b30-9bb0-6f87d8b343c1","block_type":"box","text":"i.e.","page_number":185,"box":{"x":646,"y":173,"width":20,"height":9}},{"id":"3a9961b5-1902-4e72-b738-da209a74e76f","block_type":"box","text":", ratings on nonfinancial","page_number":185,"box":{"x":669,"y":173,"width":169,"height":11}},{"id":"232d9bca-75c3-45d0-8620-0123c59f7bf8","block_type":"box","text":"corporate, financial institution, and public sector entities) on the global long-term scale by adding (sf) to all structured","page_number":185,"box":{"x":69,"y":188,"width":837,"height":12}},{"id":"eeba6aef-970f-45a3-af2d-0996d9ab11da","block_type":"box","text":"finance ratings. The addition of (sf) to structured finance ratings should eliminate any presumption that such ratings","page_number":185,"box":{"x":68,"y":203,"width":828,"height":12}},{"id":"f0ac5d25-0654-4ee6-bfc4-9d9e8942d6a3","block_type":"box","text":"and fundamental ratings at the same letter grade level will behave the same. The (sf) indicator for structured finance","page_number":185,"box":{"x":69,"y":218,"width":832,"height":12}},{"id":"282cc72a-ba8d-4f2e-b5c3-f07bae0b8e82","block_type":"box","text":"security ratings indicates that otherwise similarly rated structured finance and fundamental securities may have","page_number":185,"box":{"x":69,"y":234,"width":797,"height":11}},{"id":"a10431e4-c603-46e8-97ed-fd62242cbd9b","block_type":"box","text":"different risk characteristics. Through its current methodologies, however, Moody’s aspires to achieve broad","page_number":185,"box":{"x":69,"y":249,"width":771,"height":11}},{"id":"b708db23-3def-4d34-afd0-0091310561a0","block_type":"box","text":"expected equivalence in structured finance and fundamental rating per formance when measured over a long period","page_number":185,"box":{"x":69,"y":264,"width":821,"height":11}},{"id":"fbea51e5-2763-4af7-ae92-d4123c9457ca","block_type":"box","text":"of time.","page_number":185,"box":{"x":69,"y":279,"width":53,"height":9}},{"id":"017d98ee-6df6-4b78-a218-9147ae7406c1","block_type":"box","text":"Description of Moody’s Global Long-Term Rating Scale","page_number":185,"box":{"x":69,"y":309,"width":395,"height":11}},{"id":"109593f9-9d09-4fed-8eb9-218e37ca457f","block_type":"box","text":"Aaa Obligations rated Aaa are judged to be of the highest quality, subject to the lowest level of credit","page_number":185,"box":{"x":68,"y":337,"width":815,"height":11}},{"id":"f5e0c5f5-c998-4e1b-825f-beec1fd66221","block_type":"box","text":"risk.","page_number":185,"box":{"x":197,"y":352,"width":28,"height":9}},{"id":"a0f2f766-0b5f-4005-8cf4-ca79919aa0de","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":185,"box":{"x":68,"y":372,"width":773,"height":11}},{"id":"7f1121dd-99a9-4174-a732-9d180f22bead","block_type":"box","text":"A Obligations rated A are judged to be upper-medium grade and are subject to low credit risk.","page_number":185,"box":{"x":68,"y":392,"width":776,"height":12}},{"id":"1e5736c3-475e-4a4e-84b6-4f9035615ab4","block_type":"box","text":"Baa Obligations rated Baa are judged to be medium-grade and subject to moderate credit risk and as","page_number":185,"box":{"x":70,"y":413,"width":813,"height":11}},{"id":"9315f8f9-719b-4885-8cb1-12208c6f4cef","block_type":"box","text":"such may possess cer tain speculative characteristics.","page_number":185,"box":{"x":196,"y":428,"width":385,"height":11}},{"id":"46a6df7f-a1a5-4d92-9cab-8c16cb5ac3ae","block_type":"box","text":"Ba Obligations rated Ba are judged to be speculative and are subject to substantial credit risk.","page_number":185,"box":{"x":70,"y":448,"width":775,"height":11}},{"id":"3b4983ea-8785-4daa-8e26-95b91a075190","block_type":"box","text":"B Obligations rated B are considered speculative and are subject to high credit risk.","page_number":185,"box":{"x":70,"y":468,"width":707,"height":11}},{"id":"92736dbe-8238-4959-94aa-afbe418f8951","block_type":"box","text":"Caa Obligations rated Caa are judged to be speculative of poor standing and are subject to very high","page_number":185,"box":{"x":69,"y":488,"width":810,"height":11}},{"id":"159852ad-708d-470a-a8c9-43740307d0d4","block_type":"box","text":"credit risk.","page_number":185,"box":{"x":196,"y":503,"width":74,"height":9}},{"id":"b264f3b0-0f13-47ad-a928-8eb5b9383c10","block_type":"box","text":"Ca Obligations rated Ca are highly speculative and are likely in, or very near, default, with some","page_number":185,"box":{"x":69,"y":523,"width":783,"height":12}},{"id":"d2387278-8104-4f64-a2a0-0b3e8159a042","block_type":"box","text":"prospect of recovery of principal and interest.","page_number":185,"box":{"x":197,"y":538,"width":322,"height":12}},{"id":"9ada632b-72c5-4b5e-9909-292e08cb8808","block_type":"box","text":"C Obligations rated C are the lowest rated and are typically in default, with little prospect for recovery","page_number":185,"box":{"x":69,"y":559,"width":834,"height":11}},{"id":"fc076cb3-ef86-4003-a447-1ba549117c5a","block_type":"box","text":"of principal or interest.","page_number":185,"box":{"x":196,"y":574,"width":160,"height":11}},{"id":"b08e64a3-f113-404c-a9f3-df9bb079a2a7","block_type":"box","text":"Note:","page_number":185,"box":{"x":102,"y":594,"width":37,"height":9}},{"id":"75335e97-b240-4990-b38c-820eedb7f05d","block_type":"box","text":"Moody’s appends numerical modifiers 1, 2, and 3 to each generic rating classification from Aa through","page_number":185,"box":{"x":146,"y":594,"width":731,"height":11}},{"id":"5a2e99e4-3ae1-46e9-93a5-4ebba0e8f960","block_type":"box","text":"Caa. The modifier 1 indicates that the obligation ranks in the higher end of its generic rating category; the modifier 2","page_number":185,"box":{"x":69,"y":609,"width":831,"height":11}},{"id":"cd73dc4c-cdd2-4457-a377-c8b4ce638a51","block_type":"box","text":"indicates a mid-range ranking; and the modifier 3 indicates a ranking in the lower end of that generic rating category.","page_number":185,"box":{"x":70,"y":624,"width":829,"height":11}},{"id":"4b5d8acf-8afc-4ed8-8e69-e36aae287ff3","block_type":"box","text":"Additionally, a “(hyb)” indicator is appended to all ratings of hybrid securities issued by banks, insurers, finance","page_number":185,"box":{"x":68,"y":639,"width":795,"height":12}},{"id":"86604cef-af29-4b78-a4e3-50bf9d9eca06","block_type":"box","text":"companies, and securities firms.","page_number":185,"box":{"x":69,"y":654,"width":232,"height":11}},{"id":"47e5d2d1-5001-4c00-ae54-eb6719b592a6","block_type":"box","text":"By their terms, hybrid securities allow for the omission of scheduled dividends, interest, or principal payments,","page_number":185,"box":{"x":102,"y":677,"width":787,"height":11}},{"id":"aaf83e42-efa0-4a5e-a3da-714d7b2d6543","block_type":"box","text":"which can potentially result in impairment if such an omission occurs. Hybrid securities may also be subject to","page_number":185,"box":{"x":68,"y":692,"width":788,"height":11}},{"id":"ba58d14b-578d-4e81-ae05-88c0e02ca6fc","block_type":"box","text":"contractually allowable write-downs of principal that could result in impairment. Together with the hybrid indicator, the","page_number":185,"box":{"x":69,"y":707,"width":833,"height":12}},{"id":"cc1feacc-55cc-4669-88be-2b085a827954","block_type":"box","text":"long-term obligation rating assigned to a hybrid security is an expression of the relative credit risk associated with","page_number":185,"box":{"x":70,"y":722,"width":809,"height":12}},{"id":"6f69f6ff-c222-4549-a991-911e10639afa","block_type":"box","text":"that security.","page_number":185,"box":{"x":68,"y":738,"width":91,"height":11}},{"id":"0bd64f00-b35c-42e5-8c69-c62ef550b338","block_type":"box","text":"Description of Moody’s Global Short-Term Rating Scale","page_number":185,"box":{"x":69,"y":768,"width":400,"height":11}},{"id":"948c51fa-65b2-4edf-8221-bd4a95f9dfe8","block_type":"box","text":"P-1 Ratings of Prime-1 reflect a superior ability to repay shor t-term obligations.","page_number":185,"box":{"x":69,"y":795,"width":658,"height":12}},{"id":"952423b9-6425-4837-a0aa-f36eb099fc4b","block_type":"box","text":"P-2 Ratings of Prime-2 reflect a strong ability to repay shor t-term obligations.","page_number":185,"box":{"x":69,"y":816,"width":645,"height":11}},{"id":"48a7fcb7-c707-462b-b678-4fbd79fe5c7d","block_type":"box","text":"P-3 Ratings of Prime-3 reflect an acceptable ability to repay shor t-term obligations.","page_number":185,"box":{"x":69,"y":836,"width":686,"height":11}},{"id":"4cfb3740-ee86-4370-9892-4487d1f05bba","block_type":"box","text":"NP Issuers (or suppor ting institutions) rated Not Prime do not fall within any of the Prime rating","page_number":185,"box":{"x":70,"y":856,"width":778,"height":11}},{"id":"fa8b69c7-410e-4cfb-be61-b3e5217eba80","block_type":"box","text":"categories.","page_number":185,"box":{"x":196,"y":871,"width":77,"height":11}},{"id":"fd24f4d6-ceb1-4f24-9401-0310766c508c","block_type":"box","text":"A-2","page_number":185,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"98f0de87-2123-4c43-8edf-ffc2139f9523","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":185,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"c5d1c155-9e24-4cb8-b7bb-f64499dc72bf","block_type":"box","text":"Description of Moody’s U.S. Municipal Short-Term Debt and Demand Obligation Ratings","page_number":186,"box":{"x":69,"y":45,"width":637,"height":11}},{"id":"17198cab-864a-4c7c-8200-e417db20155b","block_type":"box","text":"Description of Moody’s Short-Term Obligation Ratings","page_number":186,"box":{"x":69,"y":75,"width":391,"height":11}},{"id":"ca6236d4-fb19-4a0a-8731-efef4bfdbeec","block_type":"box","text":"Moody’s uses the global shor t-term Prime rating scale for commercial paper issued by U.S. municipalities and","page_number":186,"box":{"x":102,"y":98,"width":784,"height":11}},{"id":"4f055921-1c61-4568-acd3-d971c2f32ede","block_type":"box","text":"nonprofits. These commercial paper programs may be backed by external letters of credit or liquidity facilities, or by","page_number":186,"box":{"x":69,"y":113,"width":824,"height":11}},{"id":"e5024d0b-323d-4e27-b1a5-22c639386e45","block_type":"box","text":"an issuer’s self-liquidity.","page_number":186,"box":{"x":69,"y":128,"width":170,"height":11}},{"id":"b69db99f-db8e-4483-bdf0-e08f2431f16e","block_type":"box","text":"For other shor t-term municipal obligations, Moody’s uses one of two other shor t-term rating scales, the","page_number":186,"box":{"x":102,"y":150,"width":736,"height":12}},{"id":"0c73bfe9-ed90-4b22-bb57-25c916d525cf","block_type":"box","text":"Municipal Investment Grade (“MIG”) and Variable Municipal Investment Grade (“VMIG”) scales discussed below.","page_number":186,"box":{"x":70,"y":166,"width":796,"height":11}},{"id":"d21912ef-45c5-4df0-b828-c335b2ba957a","block_type":"box","text":"Moody’s uses the MIG scale for U.S. municipal cash flow notes, bond anticipation notes and cer tain other shor t","page_number":186,"box":{"x":102,"y":188,"width":803,"height":11}},{"id":"d7bf50fe-797f-4b1e-a349-e53408f26fd9","block_type":"box","text":"term obligations, which typically mature in three years or less. Under cer tain circumstances, Moody’s uses the MIG","page_number":186,"box":{"x":68,"y":203,"width":823,"height":12}},{"id":"997441a2-ff44-46df-bbde-989495d009d8","block_type":"box","text":"scale for bond anticipation notes with maturities of up to five years.","page_number":186,"box":{"x":69,"y":218,"width":480,"height":12}},{"id":"282d65fb-15ba-4d45-bb17-d46e5c4b992d","block_type":"box","text":"MIG Scale","page_number":186,"box":{"x":102,"y":241,"width":71,"height":9}},{"id":"fd5f164e-d26f-4bfc-b0a1-50258333f868","block_type":"box","text":"MIG 1 This designation denotes superior credit quality. Excellent protection is afforded by established","page_number":186,"box":{"x":70,"y":269,"width":802,"height":11}},{"id":"c273dbf3-899e-425e-a493-7178b648ea76","block_type":"box","text":"cash flows, highly reliable liquidity suppor t, or demonstrated broad-based access to the market for","page_number":186,"box":{"x":196,"y":284,"width":703,"height":11}},{"id":"5dcab483-1249-469d-b731-c4984408db65","block_type":"box","text":"refinancing.","page_number":186,"box":{"x":197,"y":299,"width":80,"height":11}},{"id":"962fffd5-ab83-4442-9447-441b90c333be","block_type":"box","text":"MIG 2 This designation denotes strong credit quality. Margins of protection are ample, although not as","page_number":186,"box":{"x":70,"y":319,"width":809,"height":12}},{"id":"653187a7-6511-4cea-bcfb-c5eb16a5c035","block_type":"box","text":"large as in the preceding group.","page_number":186,"box":{"x":197,"y":335,"width":224,"height":11}},{"id":"450c0628-d2ec-4eb5-a68b-dd1e02994f33","block_type":"box","text":"MIG 3 This designation denotes acceptable credit quality. Liquidity and cash-flow protection may be","page_number":186,"box":{"x":70,"y":355,"width":785,"height":11}},{"id":"cd723232-d024-41ed-98e7-597f7fc11865","block_type":"box","text":"narrow, and market access for refinancing is likely to be less well-established.","page_number":186,"box":{"x":197,"y":370,"width":554,"height":11}},{"id":"c5a3ac95-3239-48f1-b56d-b69a45be8547","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Debt instruments in this category may","page_number":186,"box":{"x":69,"y":390,"width":813,"height":11}},{"id":"d92c84b5-6878-41a7-b3ec-73df5f2a1f50","block_type":"box","text":"lack sufficient margins of protection.","page_number":186,"box":{"x":197,"y":405,"width":259,"height":11}},{"id":"59bd94f1-c981-4a2d-84ba-bc02daff73d8","block_type":"box","text":"Description of Moody’s Demand Obligation Ratings","page_number":186,"box":{"x":69,"y":433,"width":371,"height":11}},{"id":"48618fc2-0b3f-4f1c-8a27-616878a3721e","block_type":"box","text":"In the case of variable rate demand obligations (“VRDOs”), a two-component rating is assigned. The components","page_number":186,"box":{"x":102,"y":455,"width":804,"height":12}},{"id":"214b602a-1cd1-4a22-8794-ab7cddbeb313","block_type":"box","text":"are a long-term rating and a shor t-term demand obligation rating. The long-term rating addresses the issuer’s ability","page_number":186,"box":{"x":69,"y":471,"width":826,"height":11}},{"id":"be1885e9-8e1b-4044-bffa-773a5f3c7cb5","block_type":"box","text":"to meet scheduled principal and interest payments. The shor t-term demand obligation rating addresses the ability of","page_number":186,"box":{"x":68,"y":486,"width":832,"height":11}},{"id":"9a74a660-4696-4a42-b27e-97d93f12e051","block_type":"box","text":"the issuer or the liquidity provider to make payments associated with the purchase-price-upon-demand feature","page_number":186,"box":{"x":68,"y":501,"width":784,"height":11}},{"id":"a682cc0e-696a-4712-a373-f9ef226f9e6d","block_type":"box","text":"(“demand feature”) of the VRDO. The shor t-term demand obligation rating uses the VMIG scale. VMIG ratings with","page_number":186,"box":{"x":69,"y":516,"width":811,"height":11}},{"id":"813db523-a84f-4ee4-82fe-e84f9a27d7d8","block_type":"box","text":"liquidity suppor t use as an input the shor t-term Counterpar ty Risk Assessment of the suppor t provider, or the long","page_number":186,"box":{"x":70,"y":531,"width":819,"height":11}},{"id":"d11696b9-7553-4ec4-b033-21e07f3443f8","block_type":"box","text":"term rating of the underlying obligor in the absence of third par ty liquidity suppor t. Transitions of VMIG ratings of","page_number":186,"box":{"x":68,"y":546,"width":802,"height":11}},{"id":"d2402465-38b6-44eb-9d8e-159250c93076","block_type":"box","text":"demand obligations with conditional liquidity suppor t differ from transitions on the Prime scale to reflect the risk that","page_number":186,"box":{"x":69,"y":561,"width":833,"height":11}},{"id":"049c6a5f-65bd-48d1-bbb6-a560aba868d1","block_type":"box","text":"external liquidity suppor t will terminate if the issuer’s long-term rating drops below investment grade.","page_number":186,"box":{"x":69,"y":576,"width":719,"height":12}},{"id":"e19cad59-827a-4aa1-af81-5aeb94dc4588","block_type":"box","text":"Moody’s typically assigns the VMIG shor t-term demand obligation rating if the frequency of the demand feature is","page_number":186,"box":{"x":102,"y":599,"width":807,"height":11}},{"id":"0078a1a3-cfaa-412b-8442-700f93d7c5f2","block_type":"box","text":"less than every three years. If the frequency of the demand feature is less than three years but the purchase price is","page_number":186,"box":{"x":70,"y":614,"width":833,"height":11}},{"id":"507839f5-808e-4a93-8bee-60a9b46c30e7","block_type":"box","text":"payable only with remarketing proceeds, the shor t-term demand obligation rating is “NR”.","page_number":186,"box":{"x":70,"y":629,"width":635,"height":11}},{"id":"cf4e5a78-915f-4f05-9dae-6f9230c9cbc6","block_type":"box","text":"VMIG Scale","page_number":186,"box":{"x":101,"y":652,"width":81,"height":9}},{"id":"a053fe16-1611-4cc3-b060-e2b5d84c3d22","block_type":"box","text":"VMIG 1 This designation denotes superior credit quality. Excellent protection is afforded by the superior","page_number":186,"box":{"x":68,"y":680,"width":808,"height":11}},{"id":"a021db46-67ef-445a-84ce-90b40f5a2953","block_type":"box","text":"shor t-term credit strength of the liquidity provider and structural and legal protections that ensure","page_number":186,"box":{"x":196,"y":695,"width":695,"height":11}},{"id":"02191831-122e-4691-a1a8-5fc15a71f530","block_type":"box","text":"the timely payment of purchase price upon demand.","page_number":186,"box":{"x":195,"y":710,"width":370,"height":11}},{"id":"83435ac4-67d2-4396-a5a1-e649efadac6d","block_type":"box","text":"VMIG 2 This designation denotes strong credit quality. Good protection is afforded by the strong shor t-term","page_number":186,"box":{"x":68,"y":730,"width":834,"height":11}},{"id":"893382e3-164b-46b0-848d-5a0821704c05","block_type":"box","text":"credit strength of the liquidity provider and structural and legal protections that ensure the timely","page_number":186,"box":{"x":196,"y":745,"width":691,"height":11}},{"id":"1453ddf0-bee8-4336-999a-b405dac366a5","block_type":"box","text":"payment of purchase price upon demand.","page_number":186,"box":{"x":197,"y":760,"width":294,"height":11}},{"id":"b711990c-f878-449c-a5b2-0c5a6865f07e","block_type":"box","text":"VMIG 3 This designation denotes acceptable credit quality. Adequate protection is afforded by the","page_number":186,"box":{"x":68,"y":780,"width":768,"height":12}},{"id":"5b17e44d-e0db-47dc-abdd-7b043732594e","block_type":"box","text":"satisfactory shor t-term credit strength of the liquidity provider and structural and legal protections","page_number":186,"box":{"x":196,"y":795,"width":697,"height":12}},{"id":"5f3ecf7b-60ff-4fd4-9c53-a9674e0f6948","block_type":"box","text":"that ensure the timely payment of purchase price upon demand.","page_number":186,"box":{"x":195,"y":811,"width":457,"height":11}},{"id":"012c40db-804f-4e21-9f87-f7c138016fb1","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Demand features rated in this category","page_number":186,"box":{"x":69,"y":831,"width":820,"height":11}},{"id":"aea6215e-29ff-4741-bc64-edbf4b9625b1","block_type":"box","text":"may be suppor ted by a liquidity provider that does not have a sufficiently strong shor t-term rating or","page_number":186,"box":{"x":197,"y":846,"width":711,"height":11}},{"id":"75bbeae9-e1a2-46a8-873e-502e9db34bd1","block_type":"box","text":"may lack the structural or legal protections necessary to ensure the timely payment of purchase","page_number":186,"box":{"x":197,"y":861,"width":684,"height":11}},{"id":"ce59c70d-f7fd-4f29-a421-ef455f987963","block_type":"box","text":"price upon demand.","page_number":186,"box":{"x":197,"y":876,"width":139,"height":11}},{"id":"c2f1804f-82d3-429b-81d6-ad4fb3340d3d","block_type":"box","text":"A-3","page_number":186,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"267a52e9-a8bd-40a5-8a34-0abda704a6e4","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":186,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"eef98c37-9702-406f-8c8a-764024139f82","block_type":"box","text":"Description of S&P Global Ratings (“S&P”), a Division of S&P Global Inc., Issue Credit Ratings","page_number":187,"box":{"x":69,"y":45,"width":691,"height":11}},{"id":"79823071-08b1-47ec-adee-038c3f9292be","block_type":"box","text":"An S&P issue credit rating is a forward-looking opinion about the creditwor thiness of an obligor with respect to a","page_number":187,"box":{"x":101,"y":67,"width":801,"height":12}},{"id":"7544a42d-1a6f-46ba-ab54-aca2c1738318","block_type":"box","text":"specific financial obligation, a specific class of financial obligations, or a specific financial program (including ratings","page_number":187,"box":{"x":69,"y":82,"width":829,"height":12}},{"id":"6a4a5e42-28b8-42a2-81b3-3097cb87e12c","block_type":"box","text":"on medium-term note programs and commercial paper programs). It takes into consideration the creditwor thiness of","page_number":187,"box":{"x":69,"y":98,"width":831,"height":11}},{"id":"5b92d2ca-a77c-42c4-901d-6a03949b13de","block_type":"box","text":"guarantors, insurers, or other forms of credit enhancement on the obligation and takes into account the currency in","page_number":187,"box":{"x":68,"y":113,"width":823,"height":11}},{"id":"313c417f-a4fe-4aa4-8579-a62db3ec96cb","block_type":"box","text":"which the obligation is denominated. The opinion reflects S&P’s view of the obligor’s capacity and willingness to meet","page_number":187,"box":{"x":68,"y":128,"width":841,"height":11}},{"id":"df44d4ac-d2ef-4bd2-83b5-4551de23520b","block_type":"box","text":"its financial commitments as they come due, and this opinion may assess terms, such as collateral security and","page_number":187,"box":{"x":70,"y":143,"width":801,"height":11}},{"id":"958084dd-7438-4a5b-88ab-d9d35de5972e","block_type":"box","text":"subordination, which could affect ultimate payment in the event of default.","page_number":187,"box":{"x":69,"y":158,"width":530,"height":11}},{"id":"041c995e-69c6-41ab-89f0-3d303e78d178","block_type":"box","text":"Issue credit ratings can be either long-term or shor t-term. Shor t-term issue credit ratings are generally assigned","page_number":187,"box":{"x":102,"y":181,"width":796,"height":11}},{"id":"61878fd0-44b7-4f28-9db3-8d4984bd4768","block_type":"box","text":"to those obligations considered shor t-term in the relevant market, typically with an original maturity of no more than","page_number":187,"box":{"x":68,"y":196,"width":825,"height":11}},{"id":"4c03b48f-add7-4600-9aa8-baa8ec3b313d","block_type":"box","text":"365 days. Shor t-term issue credit ratings are also used to indicate the creditwor thiness of an obligor with respect to","page_number":187,"box":{"x":69,"y":211,"width":832,"height":11}},{"id":"abac7855-4192-42c2-811a-95b4517e5871","block_type":"box","text":"put features on long-term obligations. S&P would typically assign a long-term issue credit rating to an obligation with","page_number":187,"box":{"x":70,"y":226,"width":826,"height":11}},{"id":"95f4b798-6b01-439b-98f8-d6ba6c452ae6","block_type":"box","text":"an original maturity of greater than 365 days. However, the ratings S&P assigns to cer tain instruments may diverge","page_number":187,"box":{"x":69,"y":241,"width":823,"height":11}},{"id":"cbbd35d5-4dff-4aab-92a3-ac55b33e2797","block_type":"box","text":"from these guidelines based on market practices. Medium-term notes are assigned long-term ratings.","page_number":187,"box":{"x":68,"y":256,"width":724,"height":12}},{"id":"e83fb983-c741-48f7-bdac-26647bc79f9c","block_type":"box","text":"Issue credit ratings are based, in varying degrees, on S&P’s analysis of the following considerations:","page_number":187,"box":{"x":102,"y":279,"width":718,"height":11}},{"id":"fcd28674-1515-4737-8a48-f583e697cd37","block_type":"box","text":"•","page_number":187,"box":{"x":69,"y":302,"width":6,"height":5}},{"id":"acef6145-d480-4a74-a4e5-46ff3b8125c0","block_type":"box","text":"The likelihood of payment—the capacity and willingness of the obligor to meet its financial commitments on an","page_number":187,"box":{"x":101,"y":299,"width":790,"height":11}},{"id":"9cd2efbd-68c9-4a33-a58a-da085cd78290","block_type":"box","text":"obligation in accordance with the terms of the obligation;","page_number":187,"box":{"x":102,"y":314,"width":404,"height":12}},{"id":"469831f1-3b2d-4bcc-9387-d554527c6cf3","block_type":"box","text":"•","page_number":187,"box":{"x":69,"y":337,"width":6,"height":5}},{"id":"6c81f9cb-2856-49ce-921e-bbbe62e4fdb1","block_type":"box","text":"The nature and provisions of the financial obligation, and the promise S&P imputes; and","page_number":187,"box":{"x":101,"y":334,"width":629,"height":12}},{"id":"8e088888-d3da-4ddd-8fbb-41f9c619c8e0","block_type":"box","text":"•","page_number":187,"box":{"x":69,"y":357,"width":6,"height":5}},{"id":"0dbf1b87-5d8b-4097-8447-1e8cfa7e808e","block_type":"box","text":"The protection afforded by, and relative position of, the financial obligation in the event of a bankruptcy,","page_number":187,"box":{"x":101,"y":355,"width":738,"height":11}},{"id":"1ad22234-ab3f-4f91-8e27-4bed2bdad58e","block_type":"box","text":"reorganization, or other arrangement under the laws of bankruptcy and other laws affecting creditors’ rights.","page_number":187,"box":{"x":102,"y":370,"width":770,"height":11}},{"id":"efe30854-ae41-4626-99bd-513b9157168e","block_type":"box","text":"An issue rating is an assessment of default risk but may incorporate an assessment of relative seniority or","page_number":187,"box":{"x":101,"y":392,"width":763,"height":12}},{"id":"1faa8b82-334e-4e82-81c6-3c5f5f9526f2","block_type":"box","text":"ultimate recovery in the event of default. Junior obligations are typically rated lower than senior obligations, to reflect","page_number":187,"box":{"x":69,"y":407,"width":833,"height":12}},{"id":"71317fc6-9fff-4930-9d44-b9bc894bc59f","block_type":"box","text":"lower priority in bankruptcy, as noted above. (Such differentiation may apply when an entity has both senior and","page_number":187,"box":{"x":70,"y":423,"width":794,"height":11}},{"id":"8a6c1a71-f398-46ff-8a35-c3d5bf6f05a8","block_type":"box","text":"subordinated obligations, secured and unsecured obligations, or operating company and holding company","page_number":187,"box":{"x":69,"y":438,"width":754,"height":11}},{"id":"159ee6ae-3102-4e6b-8c14-d4cd1770df1c","block_type":"box","text":"obligations.)","page_number":187,"box":{"x":69,"y":453,"width":86,"height":11}},{"id":"57f330f9-5eac-468b-a43c-d40e14391f0e","block_type":"box","text":"Long-Term Issue Credit Ratings*","page_number":187,"box":{"x":69,"y":483,"width":236,"height":11}},{"id":"b20024de-291f-4b78-8c48-7030ac2fe4a4","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":187,"box":{"x":68,"y":511,"width":833,"height":11}},{"id":"a3c096e5-a527-4a09-8b07-0df6d77695ef","block_type":"box","text":"financial commitments on the obligation is extremely strong.","page_number":187,"box":{"x":196,"y":526,"width":429,"height":11}},{"id":"06a279bf-56e2-49c1-a9bc-3a08dba78e3d","block_type":"box","text":"AA An obligation rated ‘AA’ differs from the highest-rated obligations only to a small degree. The","page_number":187,"box":{"x":68,"y":546,"width":788,"height":11}},{"id":"c82ed2de-795f-49cd-a59a-bc980a0b3759","block_type":"box","text":"obligor’s capacity to meet its financial commitments on the obligation is very strong.","page_number":187,"box":{"x":196,"y":561,"width":602,"height":11}},{"id":"27ba5009-7997-43ab-b3e2-f9f526a03405","block_type":"box","text":"A An obligation rated ‘A’ is somewhat more susceptible to the adverse effects of changes in","page_number":187,"box":{"x":68,"y":581,"width":770,"height":12}},{"id":"3c423d35-ebe0-4d60-a346-a364e6d36ac0","block_type":"box","text":"circumstances and economic conditions than obligations in higher-rated categories. However, the","page_number":187,"box":{"x":196,"y":597,"width":692,"height":11}},{"id":"c11245a0-1352-4e06-b390-51bcb57a2215","block_type":"box","text":"obligor’s capacity to meet its financial commitments on the obligation is still strong.","page_number":187,"box":{"x":196,"y":612,"width":598,"height":11}},{"id":"83e79b41-f8d0-4d6e-9c98-2c50628eb416","block_type":"box","text":"BBB An obligation rated ‘BBB’ exhibits adequate protection parameters. However, adverse economic","page_number":187,"box":{"x":70,"y":632,"width":806,"height":11}},{"id":"581ca8fe-7cbf-47ed-95c3-6b2a9dd238c3","block_type":"box","text":"conditions or changing circumstances are more likely to weaken the obligor’s capacity to meet its","page_number":187,"box":{"x":196,"y":647,"width":694,"height":11}},{"id":"40cb7c54-05a1-4c21-af10-a70b93c93ca4","block_type":"box","text":"financial commitments on the obligation.","page_number":187,"box":{"x":196,"y":662,"width":289,"height":11}},{"id":"48be2b87-a0f9-408e-8ffa-0734c1f9db31","block_type":"box","text":"BB,","page_number":187,"box":{"x":70,"y":682,"width":22,"height":11}},{"id":"c2e58432-d6ee-43ee-953e-7b3d1d5cc71d","block_type":"box","text":"B,","page_number":187,"box":{"x":70,"y":697,"width":12,"height":11}},{"id":"bea226bb-e13a-4af6-af38-5711efbe4258","block_type":"box","text":"CCC,","page_number":187,"box":{"x":69,"y":712,"width":33,"height":11}},{"id":"deb534ad-74d7-4276-8487-338995a06028","block_type":"box","text":"CC,","page_number":187,"box":{"x":69,"y":728,"width":23,"height":10}},{"id":"efb3bf4a-8a47-4179-afe0-702261a44565","block_type":"box","text":"and C","page_number":187,"box":{"x":69,"y":743,"width":40,"height":9}},{"id":"4a022d52-5bf1-4007-9445-7a15c5dc0827","block_type":"box","text":"Obligations rated ‘BB’, ‘B’, ‘CCC’, ‘CC’, and ‘C’ are regarded as having significant speculative","page_number":187,"box":{"x":196,"y":682,"width":667,"height":11}},{"id":"60881435-d64d-45db-a83e-bafb9c964548","block_type":"box","text":"characteristics. ‘BB’ indicates the least degree of speculation and ‘C’ the highest. While such","page_number":187,"box":{"x":196,"y":697,"width":667,"height":12}},{"id":"f8f2ca35-ac55-4e1b-bea9-36ff5b97c4eb","block_type":"box","text":"obligations will likely have some quality and protective characteristics, these may be outweighed by","page_number":187,"box":{"x":196,"y":713,"width":707,"height":11}},{"id":"e502ea1d-8d9e-48fc-9085-b483fb39d6a2","block_type":"box","text":"large uncer tainties or major exposure to adverse conditions.","page_number":187,"box":{"x":197,"y":728,"width":428,"height":11}},{"id":"eb2b149c-e5b0-4d29-9a2f-b924e6572a18","block_type":"box","text":"BB An obligation rated ‘BB’ is less vulnerable to nonpayment than other speculative issues. However, it","page_number":187,"box":{"x":70,"y":763,"width":838,"height":11}},{"id":"fd17252f-e77e-4bcc-80f9-eba805671f28","block_type":"box","text":"faces major ongoing uncer tainties or exposure to adverse business, financial, or economic","page_number":187,"box":{"x":196,"y":778,"width":646,"height":11}},{"id":"0d7e07b2-6214-4304-9250-de0eb2088ffa","block_type":"box","text":"conditions that could lead to the obligor’s inadequate capacity to meet its financial commitments","page_number":187,"box":{"x":196,"y":793,"width":692,"height":11}},{"id":"1339e091-41c5-40cf-9642-0d36a084a595","block_type":"box","text":"on the obligation.","page_number":187,"box":{"x":196,"y":808,"width":122,"height":11}},{"id":"bac4cab0-aa26-4c6a-bb41-f1b9d74496db","block_type":"box","text":"B An obligation rated ‘B’ is more vulnerable to nonpayment than obligations rated ‘BB’, but the obligor","page_number":187,"box":{"x":70,"y":828,"width":840,"height":12}},{"id":"74c4aeb2-8bff-4fc0-a83b-c71a62fd5895","block_type":"box","text":"currently has the capacity to meet its financial commitments on the obligation. Adverse business,","page_number":187,"box":{"x":196,"y":843,"width":695,"height":12}},{"id":"8f806947-30b9-4481-986b-79eb4bb8f94d","block_type":"box","text":"financial, or economic conditions will likely impair the obligor’s capacity or willingness to meet its","page_number":187,"box":{"x":196,"y":858,"width":691,"height":12}},{"id":"aa76bbb0-d720-4767-a274-f2b6af61a5b2","block_type":"box","text":"financial commitments on the obligation.","page_number":187,"box":{"x":196,"y":874,"width":289,"height":11}},{"id":"a098b189-67b9-49c3-b210-f90a6b2cad9c","block_type":"box","text":"A-4","page_number":187,"box":{"x":477,"y":943,"width":24,"height":9}},{"id":"65836d54-3c85-4888-90df-4cc54726f3b6","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":187,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"46374186-de25-48be-a09c-1c4b2a8a0d00","block_type":"box","text":"CCC An obligation rated ‘CCC’ is currently vulnerable to nonpayment and is dependent upon favorable","page_number":188,"box":{"x":69,"y":48,"width":816,"height":12}},{"id":"a1997ddd-fbcf-4142-8798-466c93b031c1","block_type":"box","text":"business, financial, and economic conditions for the obligor to meet its financial commitments on","page_number":188,"box":{"x":196,"y":63,"width":695,"height":12}},{"id":"8d09c19b-45dc-42ce-9517-0d6785149fe3","block_type":"box","text":"the obligation. In the event of adverse business, financial, or economic conditions, the obligor is","page_number":188,"box":{"x":195,"y":79,"width":687,"height":11}},{"id":"60b7a955-9e86-493f-be3f-ff7dd2d68e7b","block_type":"box","text":"not likely to have the capacity to meet its financial commitments on the obligation.","page_number":188,"box":{"x":197,"y":94,"width":586,"height":11}},{"id":"6f42efee-8aaf-4b23-9d9f-1d3715d261b0","block_type":"box","text":"CC An obligation rated ‘CC’ is currently highly vulnerable to nonpayment. The ‘CC’ rating is used when","page_number":188,"box":{"x":69,"y":114,"width":826,"height":11}},{"id":"50c567dd-be1e-49bd-b707-7dc600eba9cd","block_type":"box","text":"a default has not yet occurred but S&P expects default to be a vir tual cer tainty, regardless of the","page_number":188,"box":{"x":196,"y":129,"width":692,"height":11}},{"id":"f65442ed-0fea-4026-b9aa-46db259ef410","block_type":"box","text":"anticipated time to default.","page_number":188,"box":{"x":196,"y":144,"width":191,"height":11}},{"id":"9030ac11-8615-47a1-a073-90eac128ef6b","block_type":"box","text":"C An obligation rated ‘C’ is currently highly vulnerable to nonpayment, and the obligation is expected","page_number":188,"box":{"x":69,"y":164,"width":826,"height":12}},{"id":"fb9b3706-1ed8-4b41-8455-af1e0ee86fdc","block_type":"box","text":"to have lower relative seniority or lower ultimate recovery compared with obligations that are rated","page_number":188,"box":{"x":195,"y":180,"width":700,"height":11}},{"id":"e6b0b28f-67a1-46f4-8250-2eb659509a81","block_type":"box","text":"higher.","page_number":188,"box":{"x":197,"y":195,"width":45,"height":11}},{"id":"a6d15ece-8ff2-4787-9ab7-800ca6169606","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":188,"box":{"x":70,"y":215,"width":789,"height":11}},{"id":"9b30970d-8248-47be-85cb-450276df1499","block_type":"box","text":"instruments, the ‘D’ rating category is used when payments on an obligation are not made on the","page_number":188,"box":{"x":197,"y":230,"width":695,"height":11}},{"id":"c67b67c5-dd87-41bb-8a02-54403be1133a","block_type":"box","text":"date due, unless S&P believes that such payments will be made within five business days in the","page_number":188,"box":{"x":196,"y":245,"width":686,"height":11}},{"id":"52bf208f-7a26-4c11-8eb5-5a93ba628590","block_type":"box","text":"absence of a stated grace period or within the earlier of the stated grace period or 30 calendar","page_number":188,"box":{"x":196,"y":260,"width":676,"height":11}},{"id":"20a064c7-87f6-4b82-acd4-27e8eff3d49f","block_type":"box","text":"days. The ‘D’ rating also will be used upon the filing of a bankruptcy petition or the taking of similar","page_number":188,"box":{"x":196,"y":275,"width":708,"height":11}},{"id":"42fbd0db-c38b-4480-a86a-5630624ee5d2","block_type":"box","text":"action and where default on an obligation is a vir tual cer tainty, for example due to automatic stay","page_number":188,"box":{"x":196,"y":290,"width":694,"height":12}},{"id":"ab105af5-c3f7-4a20-85c5-3084a49d2732","block_type":"box","text":"provisions. A rating on an obligation is lowered to ‘D’ if it is subject to a distressed debt","page_number":188,"box":{"x":197,"y":305,"width":626,"height":12}},{"id":"51a9d592-a7bb-4b6a-8d8d-1757069cc6d6","block_type":"box","text":"restructuring.","page_number":188,"box":{"x":197,"y":321,"width":92,"height":11}},{"id":"1a00a919-ac8f-471b-9695-fb1de338c2e4","block_type":"box","text":"*Ratings from ‘AA’ to ‘CCC’ may be modified by the addition of a plus (+) or minus (-) sign to show relative","page_number":188,"box":{"x":103,"y":341,"width":756,"height":11}},{"id":"b8487b9e-2517-4d63-8687-061674bae63b","block_type":"box","text":"standing within the rating categories.","page_number":188,"box":{"x":69,"y":356,"width":262,"height":11}},{"id":"30098507-c46a-410c-891a-7159b2fc09d3","block_type":"box","text":"Short-Term Issue Credit Ratings","page_number":188,"box":{"x":68,"y":386,"width":233,"height":11}},{"id":"a7ca1632-fcae-46b3-a3c4-fc548653fbf9","block_type":"box","text":"A-1 A shor t-term obligation rated ‘A-1’ is rated in the highest category by S&P. The obligor’s capacity to","page_number":188,"box":{"x":68,"y":414,"width":833,"height":11}},{"id":"58a2360a-4909-4980-85a6-73bada2fff04","block_type":"box","text":"meet its financial commitments on the obligation is strong. Within this category, cer tain obligations","page_number":188,"box":{"x":197,"y":429,"width":707,"height":11}},{"id":"97ae76ba-f949-45d6-8b02-86cb91dd6468","block_type":"box","text":"are designated with a plus sign (+). This indicates that the obligor’s capacity to meet its financial","page_number":188,"box":{"x":196,"y":444,"width":691,"height":11}},{"id":"aa0b6974-94c9-4461-8210-f18a3e7d3792","block_type":"box","text":"commitments on these obligations is extremely strong.","page_number":188,"box":{"x":196,"y":459,"width":390,"height":11}},{"id":"1ab9ee91-4fce-4e2a-9777-0032519daeea","block_type":"box","text":"A-2 A shor t-term obligation rated ‘A-2’ is somewhat more susceptible to the adverse effects of changes","page_number":188,"box":{"x":68,"y":479,"width":837,"height":12}},{"id":"039393af-98b2-4808-807e-05bb59f66edd","block_type":"box","text":"in circumstances and economic conditions than obligations in higher rating categories. However,","page_number":188,"box":{"x":197,"y":495,"width":684,"height":11}},{"id":"6cdf5ded-e563-4d70-b601-a8af8ae94447","block_type":"box","text":"the obligor’s capacity to meet its financial commitments on the obligation is satisfactory.","page_number":188,"box":{"x":195,"y":509,"width":634,"height":12}},{"id":"cb65eca6-b943-4f4a-a5fe-34c0993ce58c","block_type":"box","text":"A-3 A shor t-term obligation rated ‘A-3’ exhibits adequate protection parameters. However, adverse","page_number":188,"box":{"x":68,"y":530,"width":798,"height":11}},{"id":"37e26e3b-dfc9-455e-bf84-faf62a2fe2e4","block_type":"box","text":"economic conditions or changing circumstances are more likely to weaken an obligor’s capacity to","page_number":188,"box":{"x":196,"y":545,"width":699,"height":11}},{"id":"241b8163-d9cc-46fb-92d4-36ebb52df9c1","block_type":"box","text":"meet its financial commitments on the obligation.","page_number":188,"box":{"x":197,"y":560,"width":351,"height":11}},{"id":"cc84f569-fe7a-4e08-b9e4-98449ed46f40","block_type":"box","text":"B A shor t-term obligation rated ‘B’ is regarded as vulnerable and has significant speculative","page_number":188,"box":{"x":70,"y":580,"width":765,"height":11}},{"id":"cc9d9aa5-804c-4a64-afc6-bf2b8bacc4ce","block_type":"box","text":"characteristics. The obligor currently has the capacity to meet its financial commitments; however,","page_number":188,"box":{"x":196,"y":595,"width":700,"height":11}},{"id":"a7e8fa86-be86-491e-95d1-fd1497ed0c68","block_type":"box","text":"it faces major ongoing uncer tainties that could lead to the obligor’s inadequate capacity to meet its","page_number":188,"box":{"x":197,"y":610,"width":708,"height":12}},{"id":"9ad70f62-2ebe-4da8-894b-6ee88324fb49","block_type":"box","text":"financial commitments.","page_number":188,"box":{"x":196,"y":625,"width":165,"height":9}},{"id":"d201e2a9-eb19-4fc0-80c5-bb5769e76bfa","block_type":"box","text":"C A shor t-term obligation rated ‘C’ is currently vulnerable to nonpayment and is dependent upon","page_number":188,"box":{"x":69,"y":646,"width":796,"height":11}},{"id":"3cdbdd50-fb99-430d-8de8-da27bd898d26","block_type":"box","text":"favorable business, financial, and economic conditions for the obligor to meet its financial","page_number":188,"box":{"x":196,"y":661,"width":641,"height":11}},{"id":"f0d71151-0f02-44fe-99d7-d46feafc42e4","block_type":"box","text":"commitments on the obligation.","page_number":188,"box":{"x":196,"y":676,"width":224,"height":11}},{"id":"6c975ae8-8b21-4991-99b4-7682d137e86d","block_type":"box","text":"D A shor t-term obligation rated ‘D’ is in default or in breach of an imputed promise. For non-hybrid","page_number":188,"box":{"x":70,"y":696,"width":808,"height":11}},{"id":"13b1a838-2525-4ec1-badc-80ad795f4eb1","block_type":"box","text":"capital instruments, the ‘D’ rating category is used when payments on an obligation are not made","page_number":188,"box":{"x":196,"y":711,"width":698,"height":11}},{"id":"b45d1cdc-5eb7-4824-a960-b7e3651a19e9","block_type":"box","text":"on the date due, unless S&P believes that such payments will be made within any stated grace","page_number":188,"box":{"x":196,"y":726,"width":678,"height":12}},{"id":"f7c035ed-7e5c-4808-b59e-fc8851894692","block_type":"box","text":"period. However, any stated grace period longer than five business days will be treated as five","page_number":188,"box":{"x":197,"y":741,"width":669,"height":12}},{"id":"af4c7636-613f-4224-bb0f-e992fefa8f9e","block_type":"box","text":"business days. The ‘D’ rating also will be used upon the filing of a bankruptcy petition or the taking","page_number":188,"box":{"x":196,"y":756,"width":707,"height":12}},{"id":"826a0daa-e03b-4b36-99c1-38f82faf533c","block_type":"box","text":"of a similar action and where default on an obligation is a vir tual cer tainty, for example due to","page_number":188,"box":{"x":196,"y":772,"width":669,"height":11}},{"id":"8816b7e7-5932-4c05-ae0b-17b096ad5934","block_type":"box","text":"automatic stay provisions. A rating on an obligation is lowered to ‘D’ if it is subject to a distressed","page_number":188,"box":{"x":196,"y":787,"width":700,"height":11}},{"id":"675b09ae-5390-49b1-9507-db85e630e90e","block_type":"box","text":"debt restructuring.","page_number":188,"box":{"x":196,"y":802,"width":130,"height":11}},{"id":"59bed303-b091-4f4b-899c-d5aa50028593","block_type":"box","text":"Description of S&P’s Municipal Short-Term Note Ratings","page_number":188,"box":{"x":69,"y":830,"width":411,"height":11}},{"id":"a4f8394d-d0c3-4022-867b-82181d30cb30","block_type":"box","text":"An S&P U.S. municipal note rating reflects S&P’s opinion about the liquidity factors and market access risks","page_number":188,"box":{"x":101,"y":852,"width":772,"height":11}},{"id":"e73756c0-4318-4d74-971d-c7d9df323a3c","block_type":"box","text":"unique to the notes. Notes due in three years or less will likely receive a note rating. Notes with an original maturity","page_number":188,"box":{"x":69,"y":868,"width":823,"height":11}},{"id":"487f002f-9152-43a1-add8-add0c0b8277d","block_type":"box","text":"of more than three years will most likely receive a long-term debt rating. In determining which type of rating, if any, to","page_number":188,"box":{"x":69,"y":882,"width":832,"height":12}},{"id":"2698f989-1aed-4159-8810-eb8d04137fc0","block_type":"box","text":"assign, S&P’s analysis will review the following considerations:","page_number":188,"box":{"x":69,"y":898,"width":447,"height":11}},{"id":"7831c51a-1e6c-4ac5-a89a-4c7b127b597c","block_type":"box","text":"A-5","page_number":188,"box":{"x":477,"y":943,"width":24,"height":9}},{"id":"13866f12-e7e8-42c7-8ad1-9631767600d7","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":188,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"bc03a136-1dcd-4d5d-9493-32e92f08283b","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":48,"width":6,"height":4}},{"id":"3d6365d3-2b93-46ff-a4c1-bcdd9621971d","block_type":"box","text":"Amor tization schedule—the larger the final maturity relative to other maturities, the more likely it will be treated","page_number":189,"box":{"x":101,"y":45,"width":796,"height":11}},{"id":"38fdbbdc-6315-48b3-a515-abe7f8cbe9e0","block_type":"box","text":"as a note; and","page_number":189,"box":{"x":102,"y":60,"width":101,"height":10}},{"id":"c48011b6-87bf-4bd9-9857-1d530938141c","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":83,"width":6,"height":4}},{"id":"c59a9529-6783-4ba3-8f4c-9c3bff02ad19","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":189,"box":{"x":102,"y":80,"width":794,"height":11}},{"id":"f71598c7-474a-4750-bc6f-12bb2c1bfb2c","block_type":"box","text":"treated as a note.","page_number":189,"box":{"x":101,"y":95,"width":127,"height":9}},{"id":"da79eea9-4676-433f-8c66-dcd8c3a2d7b1","block_type":"box","text":"S&P’s municipal shor t-term note rating symbols are as follows:","page_number":189,"box":{"x":102,"y":118,"width":448,"height":11}},{"id":"81bb7907-c52e-4fae-b151-0c40858527f5","block_type":"box","text":"SP-1 Strong capacity to pay principal and interest. An issue determined to possess a very strong","page_number":189,"box":{"x":69,"y":146,"width":779,"height":11}},{"id":"8b16f7aa-7355-4370-add2-9c6a0b10eaa6","block_type":"box","text":"capacity to pay debt service is given a plus (+) designation.","page_number":189,"box":{"x":196,"y":161,"width":422,"height":11}},{"id":"9fc04a84-ec93-4646-b083-aa28b33c7048","block_type":"box","text":"SP-2 Satisfactory capacity to pay principal and interest, with some vulnerability to adverse financial and","page_number":189,"box":{"x":69,"y":181,"width":825,"height":11}},{"id":"4544213c-3ecf-4f46-96d3-13adad8ce607","block_type":"box","text":"economic changes over the term of the notes.","page_number":189,"box":{"x":196,"y":196,"width":327,"height":11}},{"id":"77b6e4f5-0ee5-40c1-a91a-778872d611c6","block_type":"box","text":"SP-3 Speculative capacity to pay principal and interest.","page_number":189,"box":{"x":69,"y":216,"width":479,"height":11}},{"id":"af814be6-6a91-46b8-8aba-8972a74dbaa1","block_type":"box","text":"D ‘D’ is assigned upon failure to pay the note when due, completion of a distressed debt","page_number":189,"box":{"x":70,"y":236,"width":745,"height":11}},{"id":"42adf1d7-f2a1-4c22-ae6b-41b9b958b925","block_type":"box","text":"restructuring, or the filing of a bankruptcy petition or the taking of similar action and where default","page_number":189,"box":{"x":197,"y":251,"width":699,"height":12}},{"id":"c9567909-e091-44bf-afa8-79060a904058","block_type":"box","text":"on an obligation is a vir tual cer tainty, for example due to automatic stay provisions.","page_number":189,"box":{"x":196,"y":266,"width":594,"height":12}},{"id":"3485da9a-9256-47cb-9248-3b1e6c0cb4a2","block_type":"box","text":"Description of Fitch Ratings’ (“Fitch’s”) Credit Ratings Scales","page_number":189,"box":{"x":69,"y":294,"width":455,"height":11}},{"id":"167ec4c7-b463-4570-b7e3-cde8d3d71b3c","block_type":"box","text":"Fitch Ratings publishes opinions on a variety of scales. The most common of these are credit ratings, but the","page_number":189,"box":{"x":102,"y":317,"width":778,"height":11}},{"id":"f3ae6566-423b-48dd-b6cf-b76eac4a71de","block_type":"box","text":"agency also publishes ratings, scores and other relative opinions relating to financial or operational strength. For","page_number":189,"box":{"x":69,"y":332,"width":804,"height":11}},{"id":"30960876-3a8c-4294-83f6-3b48208f5e4d","block_type":"box","text":"example, Fitch also provides specialized ratings of servicers of residential and commercial mor tgages, asset","page_number":189,"box":{"x":69,"y":347,"width":776,"height":11}},{"id":"6fcab892-6686-4f2d-8f3f-d5bdc77b9c0d","block_type":"box","text":"managers and funds. In each case, users should refer to the definitions of each individual scale for guidance on the","page_number":189,"box":{"x":69,"y":362,"width":827,"height":11}},{"id":"855dc82e-ed29-42f1-ae08-546a893ebda1","block_type":"box","text":"dimensions of risk covered in each assessment.","page_number":189,"box":{"x":69,"y":377,"width":344,"height":9}},{"id":"cfb475d9-625b-4557-a63b-5478a29b36f7","block_type":"box","text":"Fitch’s credit ratings relating to issuers are an opinion on the relative ability of an entity to meet financial","page_number":189,"box":{"x":102,"y":400,"width":747,"height":11}},{"id":"27b351ca-2f76-4d13-890f-f556f7c0732d","block_type":"box","text":"commitments, such as interest, preferred dividends, repayment of principal, insurance claims or counterpar ty","page_number":189,"box":{"x":69,"y":415,"width":782,"height":11}},{"id":"db9815f5-640b-4f57-86ad-2d75e1c2b8a4","block_type":"box","text":"obligations. Credit ratings relating to securities and obligations of an issuer can include a recovery expectation.","page_number":189,"box":{"x":69,"y":430,"width":793,"height":11}},{"id":"932ae267-057d-4d58-9a45-6a302c01d02e","block_type":"box","text":"Credit ratings are used by investors as indications of the likelihood of receiving the money owed to them in","page_number":189,"box":{"x":69,"y":445,"width":761,"height":12}},{"id":"5cc1c714-4c36-4bda-be00-d8b22cfd7ce8","block_type":"box","text":"accordance with the terms on which they invested. The agency’s credit ratings cover the global spectrum of","page_number":189,"box":{"x":69,"y":460,"width":766,"height":12}},{"id":"c12bc7ce-7402-4432-b03f-6aaa3def7854","block_type":"box","text":"corporate, sovereign financial, bank, insurance, and public finance entities (including supranational and sub-national","page_number":189,"box":{"x":69,"y":475,"width":827,"height":12}},{"id":"75d1ab2e-2d81-499f-a335-24bfb8cb9544","block_type":"box","text":"entities) and the securities or other obligations they issue, as well as structured finance securities backed by","page_number":189,"box":{"x":69,"y":491,"width":779,"height":11}},{"id":"85a223e0-bbc3-498a-b9b2-e09a6db703e1","block_type":"box","text":"receivables or other financial assets.","page_number":189,"box":{"x":69,"y":506,"width":262,"height":9}},{"id":"6c227f39-bf38-40f0-9b28-b646aa99b571","block_type":"box","text":"The terms “investment grade” and “speculative grade” have established themselves over time as shor thand to","page_number":189,"box":{"x":101,"y":529,"width":794,"height":11}},{"id":"eef48c17-1ce8-4184-891b-6f630fd87e3d","block_type":"box","text":"describe the categories ‘AAA’ to ‘BBB’ (investment grade) and ‘BB’ to ‘D’ (speculative grade). The terms investment","page_number":189,"box":{"x":69,"y":544,"width":826,"height":11}},{"id":"cde9f9ab-7ef5-4d16-9a69-1f926dcdadf0","block_type":"box","text":"grade and speculative grade are market conventions and do not imply any recommendation or endorsement of a","page_number":189,"box":{"x":68,"y":559,"width":800,"height":11}},{"id":"81497dc9-b4a5-4405-a8c5-b0d7007c97aa","block_type":"box","text":"specific security for investment purposes. Investment grade categories indicate relatively low to moderate credit risk,","page_number":189,"box":{"x":69,"y":574,"width":832,"height":11}},{"id":"437ea24f-b42d-423b-be4a-b031a5967cad","block_type":"box","text":"while ratings in the speculative categories either signal a higher level of credit risk or that a default has already","page_number":189,"box":{"x":68,"y":589,"width":793,"height":11}},{"id":"3e18d06f-a384-4e13-960f-e6725ea54d71","block_type":"box","text":"occurred.","page_number":189,"box":{"x":69,"y":604,"width":65,"height":9}},{"id":"9001280f-1214-422e-82b9-8a80c250f1c8","block_type":"box","text":"For the convenience of investors, Fitch may also include issues relating to a rated issuer that are not and have","page_number":189,"box":{"x":102,"y":627,"width":788,"height":11}},{"id":"1889b5c0-18fc-4719-b7c8-6983e153a39c","block_type":"box","text":"not been rated on its web page. Such issues are also denoted as ‘NR’.","page_number":189,"box":{"x":69,"y":642,"width":506,"height":11}},{"id":"f30eedf2-4167-4dc5-9113-daecd08924bd","block_type":"box","text":"Credit ratings express risk in relative rank order, which is to say they are ordinal measures of credit risk and are","page_number":189,"box":{"x":102,"y":664,"width":797,"height":12}},{"id":"70037abf-4b0f-4528-8085-9a79ab3d2df5","block_type":"box","text":"not predictive of a specific frequency of default or loss. For information about the historical per formance of ratings","page_number":189,"box":{"x":69,"y":680,"width":815,"height":11}},{"id":"98148af6-3541-4574-9e8b-963fc0f83a54","block_type":"box","text":"please refer to Fitch’s Ratings Transition and Default studies which detail the historical default rates and their","page_number":189,"box":{"x":70,"y":695,"width":783,"height":11}},{"id":"b17cd11b-7b15-4148-8b89-b44791dabba6","block_type":"box","text":"meaning. The European Securities and Markets Authority also maintains a central repository of historical default","page_number":189,"box":{"x":69,"y":710,"width":801,"height":11}},{"id":"01cebe75-673f-4f15-a207-757ef5814262","block_type":"box","text":"rates.","page_number":189,"box":{"x":69,"y":726,"width":39,"height":8}},{"id":"4f2ee6d3-828c-4d9a-98e8-35f52cb33fe7","block_type":"box","text":"Fitch’s credit ratings do not directly address any risk other than credit risk. In par ticular, ratings do not deal with","page_number":189,"box":{"x":102,"y":748,"width":798,"height":11}},{"id":"1eb00695-1d1f-4900-9827-dfefb3fed435","block_type":"box","text":"the risk of a market value loss on a rated security due to changes in interest rates, liquidity and other market","page_number":189,"box":{"x":68,"y":763,"width":780,"height":11}},{"id":"7b58ff89-c06b-42d1-8f4b-460873eca425","block_type":"box","text":"considerations. However, in terms of payment obligation on the rated liability, market risk may be considered to the","page_number":189,"box":{"x":69,"y":778,"width":821,"height":11}},{"id":"b93910d0-9b47-4a2f-a11c-e1b60392f0ab","block_type":"box","text":"extent that it influences the ability of an issuer to pay upon a commitment.","page_number":189,"box":{"x":69,"y":793,"width":531,"height":11}},{"id":"7e80d097-7587-4d28-ac2d-6f70dd247d09","block_type":"box","text":"Ratings nonetheless do not reflect market risk to the extent that they influence the size or other conditionality of","page_number":189,"box":{"x":102,"y":816,"width":801,"height":11}},{"id":"21106368-8cfc-4b36-bcda-fccc985c3e35","block_type":"box","text":"the obligation to pay upon a commitment (for example, in the case of index-linked bonds).","page_number":189,"box":{"x":68,"y":831,"width":639,"height":11}},{"id":"cfd27bd3-5b5a-4cd3-967a-2194504a5675","block_type":"box","text":"In the default components of ratings assigned to individual obligations or instruments, the agency typically rates","page_number":189,"box":{"x":102,"y":853,"width":799,"height":12}},{"id":"b2d7d106-4779-481d-b05c-de8f10cff05b","block_type":"box","text":"to the likelihood of non-payment or default in accordance with the terms of that instrument’s documentation. In","page_number":189,"box":{"x":68,"y":869,"width":794,"height":11}},{"id":"14914333-a050-429d-bd1e-9161a392e927","block_type":"box","text":"limited cases, Fitch may include additional considerations (","page_number":189,"box":{"x":70,"y":884,"width":420,"height":11}},{"id":"8dd66d88-6337-458b-95f8-107c29f0f49b","block_type":"box","text":"i.e.","page_number":189,"box":{"x":492,"y":884,"width":20,"height":9}},{"id":"a6c4e988-75d4-4d92-9277-bba3109aaca9","block_type":"box","text":"rate to a higher or lower standard than that implied in","page_number":189,"box":{"x":519,"y":884,"width":380,"height":11}},{"id":"9fb82a9b-e216-4cee-b001-1a7426596560","block_type":"box","text":"the obligation’s documentation).","page_number":189,"box":{"x":68,"y":899,"width":230,"height":11}},{"id":"72f45d78-a779-4362-8b25-9636a53e558b","block_type":"box","text":"A-6","page_number":189,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"c9e20bdb-5b42-4e66-a364-83e5fb579bac","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":189,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"2a53f73d-b2bb-4b2c-8899-e75373221302","block_type":"box","text":"The primary credit rating scales can be used to provide a rating of privately issued obligations or cer tain note","page_number":190,"box":{"x":101,"y":45,"width":779,"height":11}},{"id":"263f2bba-1714-40a5-9ccf-ad4a2d66dca7","block_type":"box","text":"issuance programs or for private ratings. In this case the rating is not published, but only provided to the issuer or its","page_number":190,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"f3ef9d88-28c9-4bf2-b819-ea90ec2c86b5","block_type":"box","text":"agents in the form of a rating letter.","page_number":190,"box":{"x":69,"y":75,"width":253,"height":11}},{"id":"5734c211-5c26-4bb9-88ef-9cf10f1fcc5d","block_type":"box","text":"The primary credit rating scales may also be used to provide ratings for a more narrow scope, including interest","page_number":190,"box":{"x":101,"y":98,"width":797,"height":11}},{"id":"c8bafe15-cc8f-46a9-b478-978ac88f38d8","block_type":"box","text":"strips and return of principal or in other forms of opinions such as credit opinions or rating assessment services.","page_number":190,"box":{"x":69,"y":113,"width":806,"height":11}},{"id":"d46ad53a-450c-4425-a9ed-fd6bc0700501","block_type":"box","text":"Credit opinions are either a notch- or category-specific view using the primary rating scale and omit one or more","page_number":190,"box":{"x":69,"y":128,"width":796,"height":11}},{"id":"2c999b81-b253-45e6-bba9-0b6788afadcc","block_type":"box","text":"characteristics of a full rating or meet them to a different standard. Credit opinions will be indicated using a lower","page_number":190,"box":{"x":69,"y":143,"width":811,"height":11}},{"id":"8bde859d-dad3-4578-bee8-3acd26b736d9","block_type":"box","text":"case letter symbol combined with either an ‘*’ (","page_number":190,"box":{"x":69,"y":158,"width":340,"height":11}},{"id":"cbec6397-96de-4eab-ae46-f82944c365c5","block_type":"box","text":"e.g.","page_number":190,"box":{"x":410,"y":160,"width":25,"height":9}},{"id":"d29b68d1-6c43-4fad-bc6c-4e3d7491815c","block_type":"box","text":"‘bbb+*’) or (cat) suffix to denote the opinion status. Credit","page_number":190,"box":{"x":443,"y":158,"width":418,"height":11}},{"id":"196b9a0d-60e9-4d0d-91f1-000e18d36807","block_type":"box","text":"opinions will be point-in-time typically but may be monitored if the analytical group believes information will be","page_number":190,"box":{"x":69,"y":173,"width":780,"height":11}},{"id":"efa43424-fd0b-483e-8243-e272016d2577","block_type":"box","text":"sufficiently available. Rating assessment services are a notch-specific view using the primary rating scale of how an","page_number":190,"box":{"x":69,"y":188,"width":827,"height":12}},{"id":"dc9dfa6f-d565-4503-988b-b4a7f012b3f3","block_type":"box","text":"existing or potential rating may be changed by a given set of hypothetical circumstances. While credit opinions and","page_number":190,"box":{"x":69,"y":203,"width":816,"height":12}},{"id":"a90b40b0-64fc-4c75-9c98-c037c6e43a3c","block_type":"box","text":"rating assessment services are point-in-time and are not monitored, they may have a directional watch or outlook","page_number":190,"box":{"x":69,"y":219,"width":808,"height":11}},{"id":"e84dbbc1-f34d-404b-9a68-744bc4ca0bcd","block_type":"box","text":"assigned, which can signify the trajectory of the credit profile.","page_number":190,"box":{"x":69,"y":234,"width":437,"height":11}},{"id":"850c8b6e-a9cd-4cb5-92bd-1df903566a29","block_type":"box","text":"Description of Fitch’s Long-Term Corporate Finance Obligations Rating Scales","page_number":190,"box":{"x":69,"y":264,"width":567,"height":11}},{"id":"5f405f50-8967-46c5-9dba-b00026b07597","block_type":"box","text":"Ratings of individual securities or financial obligations of a corporate issuer address relative vulnerability to","page_number":190,"box":{"x":102,"y":286,"width":763,"height":12}},{"id":"2af0f1b4-7e3b-4585-bf70-e6953da0eb89","block_type":"box","text":"default on an ordinal scale. In addition, for financial obligations in corporate finance, a measure of recovery given","page_number":190,"box":{"x":69,"y":302,"width":807,"height":11}},{"id":"219787cf-c0e0-42fe-828d-7b49f1417b0e","block_type":"box","text":"default on that liability is also included in the rating assessment. This notably applies to covered bonds ratings, which","page_number":190,"box":{"x":69,"y":317,"width":840,"height":11}},{"id":"8e421ad0-0971-43a2-87e6-812f02ff4d5f","block_type":"box","text":"incorporate both an indication of the probability of default and of the recovery given a default of this debt instrument.","page_number":190,"box":{"x":70,"y":332,"width":833,"height":11}},{"id":"79d40dfa-9bd0-4faa-96fe-a43673e69b36","block_type":"box","text":"On the contrary, Ratings of debtor-in-possession (“DIP”) obligations incorporate the expectation of full repayment.","page_number":190,"box":{"x":69,"y":347,"width":807,"height":11}},{"id":"3b769da6-342c-457e-bb4e-f965df388317","block_type":"box","text":"The relationship between the issuer scale and obligation scale assumes a generic historical average recovery.","page_number":190,"box":{"x":101,"y":370,"width":784,"height":11}},{"id":"6e12b62b-5ebf-4350-80b5-335b004534f7","block_type":"box","text":"Individual obligations can be assigned ratings higher, lower, or the same as that entity’s issuer rating or issuer","page_number":190,"box":{"x":70,"y":385,"width":787,"height":11}},{"id":"360c2962-24c8-4863-a061-9766bd75c124","block_type":"box","text":"default rating (“IDR”), based on their relative ranking, relative vulnerability to default or based on explicit Recovery","page_number":190,"box":{"x":69,"y":400,"width":813,"height":11}},{"id":"dd630670-527f-4203-aec3-3eb081b4bba0","block_type":"box","text":"Ratings.","page_number":190,"box":{"x":70,"y":415,"width":55,"height":11}},{"id":"f646c0d0-d95d-44aa-abe3-cc402ef9edf3","block_type":"box","text":"As a result, individual obligations of entities, such as corporations, are assigned ratings higher, lower, or the","page_number":190,"box":{"x":101,"y":438,"width":772,"height":11}},{"id":"784d2f82-ddb2-45f6-b5d5-84a6a69d6dbf","block_type":"box","text":"same as that entity’s issuer rating or IDR, except DIP obligation ratings that are not based off an IDR. At the lower","page_number":190,"box":{"x":69,"y":453,"width":815,"height":11}},{"id":"66a00d88-1816-4d83-bbb6-c8fb5b09e982","block_type":"box","text":"end of the ratings scale, Fitch publishes explicit Recovery Ratings in many cases to complement issuer and","page_number":190,"box":{"x":69,"y":468,"width":766,"height":11}},{"id":"66ed0985-7d43-4de0-9cdc-ccec562808f4","block_type":"box","text":"obligation ratings.","page_number":190,"box":{"x":69,"y":483,"width":125,"height":11}},{"id":"d04d6aa2-16ee-443c-9d04-0359d95fcd27","block_type":"box","text":"Fitch long-term obligations rating scales are as follows:","page_number":190,"box":{"x":102,"y":506,"width":390,"height":11}},{"id":"d241dd42-64a1-44ed-9c91-16c906697fc9","block_type":"box","text":"AAA Highest Credit Quality. ‘AAA’ ratings denote the lowest expectation of credit risk. They are assigned","page_number":190,"box":{"x":68,"y":533,"width":833,"height":12}},{"id":"50769e97-512c-4487-ba0d-6e1817f6e80d","block_type":"box","text":"only in cases of exceptionally strong capacity for payment of financial commitments. This capacity","page_number":190,"box":{"x":196,"y":549,"width":697,"height":11}},{"id":"a0e9e9a3-8032-4730-bccc-c087f6199d70","block_type":"box","text":"is highly unlikely to be adversely affected by foreseeable events.","page_number":190,"box":{"x":197,"y":564,"width":457,"height":11}},{"id":"77417ae0-3e64-4614-b9f4-2f00a75998df","block_type":"box","text":"AA Very High Credit Quality. ‘AA’ ratings denote expectations of very low credit risk. They indicate very","page_number":190,"box":{"x":68,"y":584,"width":829,"height":11}},{"id":"1fe5828d-fa50-4494-a9b3-583676f0e446","block_type":"box","text":"strong capacity for payment of financial commitments. This capacity is not significantly vulnerable","page_number":190,"box":{"x":196,"y":599,"width":694,"height":11}},{"id":"2c5a092d-83ff-4956-b1a3-e972b1ea13a8","block_type":"box","text":"to foreseeable events.","page_number":190,"box":{"x":195,"y":614,"width":159,"height":9}},{"id":"040fba95-e979-4181-acb0-bc3a559b2058","block_type":"box","text":"A High Credit Quality. ‘A’ ratings denote expectations of low credit risk. The capacity for payment of","page_number":190,"box":{"x":68,"y":634,"width":819,"height":12}},{"id":"acb2b6fb-0358-4c16-adc2-afeba2c08b79","block_type":"box","text":"financial commitments is considered strong. This capacity may, never theless, be more vulnerable","page_number":190,"box":{"x":196,"y":649,"width":695,"height":12}},{"id":"ee95f55b-c99e-48d2-aa59-cb807c315b5d","block_type":"box","text":"to adverse business or economic conditions than is the case for higher ratings.","page_number":190,"box":{"x":195,"y":664,"width":565,"height":12}},{"id":"67ea321d-68aa-4fae-b863-1c022eb2f63c","block_type":"box","text":"BBB Good Credit Quality. ‘BBB’ ratings indicate that expectations of credit risk are currently low. The","page_number":190,"box":{"x":70,"y":685,"width":805,"height":11}},{"id":"85763ac5-cda4-4904-82b3-1c0a79dce4d3","block_type":"box","text":"capacity for payment of financial commitments is considered adequate, but adverse business or","page_number":190,"box":{"x":196,"y":700,"width":686,"height":11}},{"id":"e0fe0ad4-2533-430d-8483-038d6eb5f106","block_type":"box","text":"economic conditions are more likely to impair this capacity.","page_number":190,"box":{"x":196,"y":715,"width":420,"height":11}},{"id":"48d07be2-2d49-4c37-b2f2-f3123ad699c5","block_type":"box","text":"BB Speculative. ‘BB’ ratings indicate an elevated vulnerability to credit risk, par ticularly in the event of","page_number":190,"box":{"x":70,"y":735,"width":830,"height":11}},{"id":"ad5fb854-ab9a-41ec-b866-3aa2fb391c28","block_type":"box","text":"adverse changes in business or economic conditions over time; however, business or financial","page_number":190,"box":{"x":196,"y":750,"width":672,"height":11}},{"id":"0af6d580-0675-4ae5-b387-4184d5c16263","block_type":"box","text":"alternatives may be available to allow financial commitments to be met.","page_number":190,"box":{"x":196,"y":765,"width":511,"height":11}},{"id":"b313c019-10a5-4716-959e-53f8d63ffc40","block_type":"box","text":"B Highly Speculative. ‘B’ ratings indicate that material credit risk is present.","page_number":190,"box":{"x":70,"y":786,"width":650,"height":11}},{"id":"7eea1a6d-32b4-43ec-b6db-4aecb50525d8","block_type":"box","text":"CCC Substantial Credit Risk. ‘CCC’ ratings indicate that substantial credit risk is present.","page_number":190,"box":{"x":69,"y":806,"width":727,"height":11}},{"id":"14c88c98-634e-49d5-b881-9e9dcd40560c","block_type":"box","text":"CC Very High Levels of Credit Risk. ‘CC’ ratings indicate very high levels of credit risk.","page_number":190,"box":{"x":69,"y":826,"width":712,"height":11}},{"id":"fa68d0dd-680a-4b47-8c06-b164541d24d8","block_type":"box","text":"C Exceptionally High Levels of Credit Risk. ‘C’ indicates exceptionally high levels of credit risk.","page_number":190,"box":{"x":69,"y":846,"width":780,"height":11}},{"id":"d777d826-e907-4b35-8cd2-df30dca51a71","block_type":"box","text":"Within rating categories, Fitch may use modifiers. The modifiers “+” or “-” may be appended to a rating to denote","page_number":190,"box":{"x":101,"y":866,"width":808,"height":11}},{"id":"2aa4b6cd-be22-4ae4-8736-8cf7946460b7","block_type":"box","text":"relative status within major rating categories.","page_number":190,"box":{"x":69,"y":881,"width":320,"height":11}},{"id":"b151b22e-89f5-420d-99d2-67acb52da3ac","block_type":"box","text":"A-7","page_number":190,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"6c387e57-c2e0-4f48-86aa-906ea25268c5","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":190,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"1a8b1595-fb7d-483d-adbd-377f61dd85f1","block_type":"box","text":"For example, the rating category ‘AA’ has three notch-specific rating levels (‘AA+’; ‘AA’; ‘AA–’; each a rating","page_number":191,"box":{"x":102,"y":45,"width":761,"height":11}},{"id":"bddc74d9-e68a-4719-8c5f-5e23fae64b52","block_type":"box","text":"level). Such suffixes are not added to ‘AAA’ ratings and ratings below the ‘CCC’ category. For the shor t-term rating","page_number":191,"box":{"x":70,"y":60,"width":813,"height":11}},{"id":"ed96771a-b1a9-4d25-b25a-b62538503c1f","block_type":"box","text":"category of ‘F1’, a ‘+’ may be appended.","page_number":191,"box":{"x":69,"y":75,"width":289,"height":11}},{"id":"01e53c8b-2bd9-4f4a-bbd5-9ceb212cbd23","block_type":"box","text":"Description of Fitch’s Short-Term Ratings Assigned to Issuers and Obligations","page_number":191,"box":{"x":69,"y":105,"width":568,"height":11}},{"id":"7ea8e20f-a31c-4c76-9a11-3724fda61885","block_type":"box","text":"A shor t-term issuer or obligation rating is based in all cases on the shor t-term vulnerability to default of the rated","page_number":191,"box":{"x":101,"y":128,"width":806,"height":11}},{"id":"59fbd66b-9047-42c7-a9d9-3d572a7fe8ce","block_type":"box","text":"entity and relates to the capacity to meet financial obligations in accordance with the documentation governing the","page_number":191,"box":{"x":69,"y":143,"width":817,"height":11}},{"id":"e1f546eb-cf63-49f3-8a04-9cdc7295f662","block_type":"box","text":"relevant obligation. Shor t-term deposit ratings may be adjusted for loss severity. Shor t-term ratings are assigned to","page_number":191,"box":{"x":69,"y":158,"width":822,"height":11}},{"id":"94239abd-fda4-4c88-9343-bedd44dd5839","block_type":"box","text":"obligations whose initial maturity is viewed as “shor t term” based on market convention. Typically, this means up to","page_number":191,"box":{"x":69,"y":173,"width":827,"height":11}},{"id":"597ab214-7533-4013-babc-43eaaf744598","block_type":"box","text":"13 months for corporate, sovereign, and structured obligations and up to 36 months for obligations in U.S. public","page_number":191,"box":{"x":70,"y":188,"width":808,"height":12}},{"id":"5f9114d3-30a2-444a-8bca-aa218db3f9f4","block_type":"box","text":"finance markets.","page_number":191,"box":{"x":68,"y":203,"width":118,"height":9}},{"id":"210a2281-3f71-4b16-8e09-462c3a218bc9","block_type":"box","text":"Fitch shor t-term ratings are as follows:","page_number":191,"box":{"x":102,"y":226,"width":273,"height":11}},{"id":"f4b15d27-79b2-470c-a84d-8d3b51ae9423","block_type":"box","text":"F1 Highest Shor t-Term Credit Quality. Indicates the strongest intrinsic capacity for timely payment of","page_number":191,"box":{"x":70,"y":254,"width":816,"height":11}},{"id":"0098ed59-1073-457f-a48a-dc32afa579cc","block_type":"box","text":"financial commitments; may have an added “+” to denote any exceptionally strong credit feature.","page_number":191,"box":{"x":196,"y":269,"width":692,"height":11}},{"id":"bf80152c-4d0d-4e05-8902-ae088927ba23","block_type":"box","text":"F2 Good Shor t-Term Credit Quality. Good intrinsic capacity for timely payment of financial","page_number":191,"box":{"x":70,"y":289,"width":734,"height":11}},{"id":"e42c825b-b9d4-41bd-82fb-0ac24819322c","block_type":"box","text":"commitments.","page_number":191,"box":{"x":196,"y":304,"width":100,"height":9}},{"id":"0f426187-0ed8-4b85-b50c-67cc3599beee","block_type":"box","text":"F3 Fair Shor t-Term Credit Quality. The intrinsic capacity for timely payment of financial commitments is","page_number":191,"box":{"x":70,"y":324,"width":831,"height":11}},{"id":"690d6f74-cfe8-4b54-910c-08e50802be21","block_type":"box","text":"adequate.","page_number":191,"box":{"x":196,"y":340,"width":70,"height":10}},{"id":"40812f6f-989d-49de-9971-f6d2d6418618","block_type":"box","text":"B Speculative Shor t-Term Credit Quality. Minimal capacity for timely payment of financial","page_number":191,"box":{"x":70,"y":360,"width":737,"height":11}},{"id":"3ba0e5f6-9d6f-4400-bf03-81b7f7ea02df","block_type":"box","text":"commitments, plus heightened vulnerability to near term adverse changes in financial and","page_number":191,"box":{"x":196,"y":375,"width":641,"height":11}},{"id":"b8f1ba28-5e20-4ce0-9397-f8fee548f703","block_type":"box","text":"economic conditions.","page_number":191,"box":{"x":196,"y":390,"width":149,"height":9}},{"id":"7529a305-2fc3-4216-bd8f-15ca22693f01","block_type":"box","text":"C High Shor t-Term Default Risk. Default is a real possibility.","page_number":191,"box":{"x":69,"y":410,"width":535,"height":11}},{"id":"953aaf2f-e9c0-483e-90f7-96429b876db4","block_type":"box","text":"RD Restricted Default. Indicates an entity that has defaulted on one or more of its financial","page_number":191,"box":{"x":70,"y":430,"width":749,"height":11}},{"id":"ee92ddcf-c839-480e-9f3e-12181a5ca62a","block_type":"box","text":"commitments, although it continues to meet other financial obligations. Typically applicable to entity","page_number":191,"box":{"x":196,"y":445,"width":714,"height":12}},{"id":"f9fb751c-c546-4683-b133-97d3919b1e93","block_type":"box","text":"ratings only.","page_number":191,"box":{"x":197,"y":461,"width":83,"height":11}},{"id":"cbdca71b-eb41-4132-9f81-3921c2c52451","block_type":"box","text":"D Default. 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subject to the","page_number":192,"box":{"x":101,"y":378,"width":763,"height":11}},{"id":"67367b35-ac0f-4a91-9075-3f8379e04921","block_type":"box","text":"principles outlined in this Policy, as par t of BlackRock’s authority to manage, acquire and dispose of account","page_number":192,"box":{"x":102,"y":393,"width":775,"height":11}},{"id":"87977aba-83a0-4bd9-9f0c-294598756360","block_type":"box","text":"assets, all as contemplated by the Funds’ respective investment management agreements.","page_number":192,"box":{"x":102,"y":408,"width":651,"height":11}},{"id":"603af9db-e7aa-4061-a5e3-71731d627a76","block_type":"box","text":"BlackRock has adopted the BlackRock Active Investment Stewardship Global Engagement and Voting","page_number":192,"box":{"x":135,"y":431,"width":718,"height":11}},{"id":"23a1426d-d4bc-4212-8a9d-b7222599232f","block_type":"box","text":"Guidelines (as from time to time amended, the “Guidelines”) governing proxy voting by active and fixed 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The Guidelines include “climate and decarbonization” guidelines which","page_number":192,"box":{"x":102,"y":461,"width":766,"height":11}},{"id":"a4bd1539-8d7b-48c3-ba1f-4a6156afb41d","block_type":"box","text":"apply to the Funds listed in Appendix A, if any.","page_number":192,"box":{"x":102,"y":476,"width":325,"height":11}},{"id":"6af7ac36-4f30-4735-9051-ff10ff3cbda6","block_type":"box","text":"BlackRock will cast votes on behalf of each of the Funds covered by this policy on specific proxy issues in","page_number":192,"box":{"x":135,"y":499,"width":751,"height":11}},{"id":"6af32211-e2cd-4b12-b389-43fe913f7e1b","block_type":"box","text":"respect of securities held by each such Fund (or may refrain from voting) in accordance with the Guidelines.","page_number":192,"box":{"x":102,"y":514,"width":765,"height":11}},{"id":"b0914675-5d40-4b8d-806d-3308d12a7601","block_type":"box","text":"Conflicts Management","page_number":192,"box":{"x":101,"y":537,"width":165,"height":11}},{"id":"da658fb0-3a54-4014-b6af-161f4c10b9a4","block_type":"box","text":"BlackRock Active Investment Stewardship (“BAIS”) maintains policies and procedures that seek to prevent","page_number":192,"box":{"x":135,"y":559,"width":758,"height":11}},{"id":"26b2dbc8-21a9-49dd-a1d0-a8196556b4a9","block_type":"box","text":"undue influence on BlackRock’s proxy voting activity and to mitigate material conflicts of interest in the exercise","page_number":192,"box":{"x":102,"y":574,"width":797,"height":12}},{"id":"ccb86ea6-3bdd-4de9-8000-6653e9d9cb5d","block_type":"box","text":"of proxy voting responsibilities. Potential material conflicts, and the resultant potential for undue influence, might","page_number":192,"box":{"x":102,"y":589,"width":805,"height":12}},{"id":"b089962d-4d5f-4c0d-8043-a0db70921f33","block_type":"box","text":"be due to a relationship between the investee company (or any shareholder proponent or dissident shareholder)","page_number":192,"box":{"x":102,"y":605,"width":797,"height":11}},{"id":"7b93d7ea-6671-4493-ac55-b9052a83a8e8","block_type":"box","text":"and BlackRock, BlackRock’s affiliates or employees, or a Fund or a Fund’s affiliates. BlackRock has taken","page_number":192,"box":{"x":102,"y":620,"width":756,"height":11}},{"id":"1ba930fb-a20e-4048-8a0d-876008a07cb8","block_type":"box","text":"cer tain steps to mitigate potential conflicts, which are outlined in detail in the Guidelines. In mitigating conflicts,","page_number":192,"box":{"x":101,"y":635,"width":800,"height":11}},{"id":"e31630ce-32b8-47bb-a876-d0d7e60abf94","block_type":"box","text":"BAIS will adhere to the Guidelines.","page_number":192,"box":{"x":102,"y":650,"width":244,"height":9}},{"id":"b82d1525-75ac-4054-874e-1d77a2dab0e7","block_type":"box","text":"In cer tain instances, BAIS will engage an independent third-par ty voting service provider to make proxy","page_number":192,"box":{"x":135,"y":673,"width":731,"height":11}},{"id":"e391a4db-89c1-4fda-8de4-7c21791e58cf","block_type":"box","text":"voting recommendations as a fur ther safeguard to avoid potential conflicts of interest, to satisfy regulatory","page_number":192,"box":{"x":101,"y":688,"width":763,"height":11}},{"id":"84d19720-d059-4f3b-a496-f2a798d3689b","block_type":"box","text":"compliance requirements, or as may be otherwise required by applicable law.","page_number":192,"box":{"x":101,"y":703,"width":550,"height":11}},{"id":"2d78cf9d-a810-4c43-a616-38cfebe388fe","block_type":"box","text":"With respect to the relationship between securities lending and proxy voting, shares on loan cannot be voted","page_number":192,"box":{"x":134,"y":726,"width":774,"height":11}},{"id":"8444e8ad-2425-4923-923d-2512bea80ba2","block_type":"box","text":"and BlackRock may determine to recall them for voting, as guided by BlackRock’s fiduciary responsibility to act","page_number":192,"box":{"x":102,"y":741,"width":791,"height":11}},{"id":"c63e3157-f8af-4637-bc53-7f7e208fa2f2","block_type":"box","text":"in clients’ financial interests. The Guidelines set for th BlackRock’s approach to recalling securities on loan in","page_number":192,"box":{"x":102,"y":756,"width":778,"height":11}},{"id":"8cf57392-38cc-439b-9866-b7f63313f98c","block_type":"box","text":"connection with proxy voting.","page_number":192,"box":{"x":101,"y":771,"width":203,"height":11}},{"id":"e7c2afb1-1ba9-4e53-a73f-409918bcc45e","block_type":"box","text":"Reports to the Board","page_number":192,"box":{"x":102,"y":794,"width":153,"height":11}},{"id":"eedae326-c3dd-4e7c-9b84-37d5cb6319f4","block_type":"box","text":"BlackRock will repor t on an annual basis to the Directors on (1) a summary of the proxy voting process as","page_number":192,"box":{"x":135,"y":816,"width":755,"height":12}},{"id":"f3f4fe36-ff59-430d-b766-a9f05cc19869","block_type":"box","text":"applicable to the Funds covered by this policy in the preceding year together with a representation that all 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. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14","page_number":195,"box":{"x":422,"y":378,"width":482,"height":9}},{"id":"3e3568d0-9f05-4712-bb31-9e60009cec56","block_type":"box","text":"BlackRock","page_number":195,"box":{"x":69,"y":943,"width":78,"height":9}},{"id":"09469b64-9c5a-4050-9621-9bcf8763dd49","block_type":"box","text":"Global Engagement and Voting Guidelines | 2","page_number":195,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"e62ee8db-c627-43ca-9d79-5bfbcc890b7c","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":195,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"1c10ce2c-c72b-4f93-9eeb-8e4ad519461d","block_type":"box","text":"OVERVIEW","page_number":196,"box":{"x":450,"y":45,"width":79,"height":9}},{"id":"d4177e27-b251-42d8-8494-0caf5ba47a58","block_type":"box","text":"This document provides high level guidance on how BlackRock Active Investment Stewardship (BAIS) 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equity","page_number":196,"box":{"x":141,"y":98,"width":606,"height":11}},{"id":"d32c1d77-3f9e-42b2-91ec-2a6b8209ef3f","block_type":"box","text":"2","page_number":196,"box":{"x":747,"y":98,"width":4,"height":4}},{"id":"de43686c-91b2-42fe-9f13-28f6725f9bff","block_type":"box","text":", providing exper tise","page_number":196,"box":{"x":753,"y":98,"width":143,"height":11}},{"id":"260ba471-8c18-4397-b004-ede714a45838","block_type":"box","text":"on investment stewardship and engaging with companies alongside and on behalf of those teams when appropriate.","page_number":196,"box":{"x":69,"y":113,"width":828,"height":11}},{"id":"0672f9b2-0e97-42c7-b5e3-ea880049fa83","block_type":"box","text":"The team is responsible for establishing voting guidelines for the active equity platform, providing vote","page_number":196,"box":{"x":68,"y":128,"width":729,"height":11}},{"id":"812bd068-2a22-4e44-848c-61abf8073f04","block_type":"box","text":"recommendations and operationalizing voting decisions. The guidance informs the voting recommendations BAIS","page_number":196,"box":{"x":69,"y":143,"width":803,"height":11}},{"id":"82235917-8aa0-435e-a937-c1ed1846fe37","block_type":"box","text":"makes to BlackRock’s active por tfolio managers. It applies to active equity holdings in BlackRock’s fundamental","page_number":196,"box":{"x":69,"y":158,"width":800,"height":11}},{"id":"062c4d87-437a-436c-9e34-2d7510b9598d","block_type":"box","text":"equity, systematic equity and multi-asset solutions strategies. It also may apply to holdings in BlackRock’s index and","page_number":196,"box":{"x":69,"y":173,"width":831,"height":11}},{"id":"1cb6f4df-bef5-45d6-9df6-5fc9f5cd6dec","block_type":"box","text":"active fixed income strategies, to the extent those strategies hold voting securities or conduct issuer engagements.","page_number":196,"box":{"x":69,"y":188,"width":823,"height":12}},{"id":"c31a2950-a40c-4075-9565-c46777800132","block_type":"box","text":"The guidelines are not prescriptive as active por tfolio managers have discretion as to how they integrate these","page_number":196,"box":{"x":68,"y":203,"width":789,"height":12}},{"id":"d8c1101a-a116-4473-8467-8f4de5d64e1d","block_type":"box","text":"guidelines within their investment processes in light of their clients’ or funds’ investment objectives. There are","page_number":196,"box":{"x":68,"y":218,"width":788,"height":12}},{"id":"9ba296e2-38f6-4ddb-9b2b-dc437404217a","block_type":"box","text":"separate, independently developed principles and voting policies that are applied to BlackRock’s index equity","page_number":196,"box":{"x":69,"y":234,"width":778,"height":11}},{"id":"010ab080-d79a-4e27-a002-963e609576f6","block_type":"box","text":"investments by a distinct and independent function, BlackRock Investment Stewardship.","page_number":196,"box":{"x":70,"y":249,"width":627,"height":11}},{"id":"7e88033d-47ad-41b9-8f42-3315b73d197a","block_type":"box","text":"1","page_number":196,"box":{"x":69,"y":294,"width":4,"height":4}},{"id":"817deb04-4393-4c40-b559-308f875481b7","block_type":"box","text":"This document includes BAIS’ benchmark policy, which covers nearly all active equity holdings in BlackRock’s","page_number":196,"box":{"x":78,"y":293,"width":777,"height":11}},{"id":"4834b20d-6391-4e11-aa0f-ffb1944897a0","block_type":"box","text":"fundamental equity, systematic equity and multi-asset solutions strategies. The benchmark policy also may apply to","page_number":196,"box":{"x":68,"y":308,"width":823,"height":11}},{"id":"a430ea55-c483-4a34-9e97-dfffc596698a","block_type":"box","text":"holdings in BlackRock’s index and active fixed income strategies, to the extent those strategies hold voting securities","page_number":196,"box":{"x":69,"y":323,"width":837,"height":12}},{"id":"9eaa4476-434b-4e3e-95bf-fe70df318fd1","block_type":"box","text":"or conduct issuer engagements. This document also includes BAIS’ decarbonization policy, which covers holdings in","page_number":196,"box":{"x":69,"y":339,"width":824,"height":11}},{"id":"96f5d953-d50b-41e0-9983-3a9892aa6273","block_type":"box","text":"BlackRock active funds that have climate and decarbonization objectives in addition to financial objectives.","page_number":196,"box":{"x":70,"y":354,"width":759,"height":11}},{"id":"222c723b-e12a-4cf2-b1f7-b330639b6148","block_type":"box","text":"2","page_number":196,"box":{"x":69,"y":372,"width":4,"height":4}},{"id":"9568a36f-5bb3-4982-8328-3fc1b4faba83","block_type":"box","text":"BlackRock segmented active and index equity investment functions, including stewardship, in January 2025 as par t","page_number":196,"box":{"x":79,"y":371,"width":825,"height":11}},{"id":"cf49291f-d105-43a3-a6b3-1748c0d90562","block_type":"box","text":"of a strategic initiative to unlock the full breadth of the firm’s active and private markets capabilities for clients. As a","page_number":196,"box":{"x":69,"y":386,"width":830,"height":12}},{"id":"e8d1ad0c-af06-4790-a029-a32b11da9052","block_type":"box","text":"result, there are two stewardship teams, which operate independently of one another and have separate voting","page_number":196,"box":{"x":69,"y":401,"width":792,"height":12}},{"id":"8e42b5e3-f6f7-4d36-a043-2eeea914746d","block_type":"box","text":"policies.","page_number":196,"box":{"x":70,"y":417,"width":56,"height":11}},{"id":"7f587b46-a1cb-415e-9898-4e37e916eed5","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":196,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"6524b538-f7c3-4d06-b0c3-1a0b2f1f60a8","block_type":"box","text":"Global Engagement and Voting Guidelines | 1","page_number":196,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"d497a889-6558-4560-b514-aa43113ed078","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":196,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"0afa00bd-57ba-446e-b297-dd8dae75f719","block_type":"box","text":"INTRODUCTION TO BLACKROCK","page_number":197,"box":{"x":372,"y":45,"width":235,"height":9}},{"id":"dcf695e8-c5c9-4893-8f86-14b8afee8ad0","block_type":"box","text":"BlackRock’s mission is to help more people invest better. The money BlackRock manages is not its own — it","page_number":197,"box":{"x":102,"y":64,"width":777,"height":11}},{"id":"00265f77-a349-4550-9049-55b3f09aca2a","block_type":"box","text":"belongs to BlackRock’s clients, many of whom make their own asset allocation and por tfolio construction decisions.","page_number":197,"box":{"x":69,"y":78,"width":828,"height":12}},{"id":"b9b408a4-0d92-403e-8546-67dc94c45a5c","block_type":"box","text":"As a fiduciary, BlackRock invests on clients’ behalf to help them meet their investment objectives. The firm does this","page_number":197,"box":{"x":68,"y":93,"width":835,"height":11}},{"id":"99476007-04ff-41c2-9dca-6b0a54fd579f","block_type":"box","text":"by understanding clients’ long-term investment objectives and offering choice on how and where they wish to invest","page_number":197,"box":{"x":69,"y":108,"width":823,"height":11}},{"id":"ae1530ba-6bb8-46ca-8172-8f5fe434a089","block_type":"box","text":"their money. BlackRock then helps clients seek the best risk-adjusted returns based on those choices, underpinning","page_number":197,"box":{"x":68,"y":123,"width":830,"height":11}},{"id":"25a339fa-772b-4a1b-9b28-a00288aab19d","block_type":"box","text":"this work with research, data and analytics.","page_number":197,"box":{"x":68,"y":138,"width":309,"height":11}},{"id":"67065bfc-514d-478d-b307-19a344fd91da","block_type":"box","text":"At BlackRock, investment stewardship is core to our role as an asset manager and a fiduciary to our clients. As","page_number":197,"box":{"x":101,"y":156,"width":796,"height":12}},{"id":"f2a44018-e323-4793-b618-dd19036fc93c","block_type":"box","text":"stewards of our clients’ assets, we engage with companies to discuss the corporate governance and business","page_number":197,"box":{"x":69,"y":171,"width":787,"height":12}},{"id":"a685e875-f184-4258-9ec8-c77b83d11eb1","block_type":"box","text":"practices that, in our experience, suppor t companies in delivering durable, risk-adjusted financial returns over time.","page_number":197,"box":{"x":70,"y":186,"width":820,"height":12}},{"id":"15ab304b-661c-4896-b223-f60bace11ece","block_type":"box","text":"We are committed to building strong relationships through constructive, ongoing dialogue with the boards and","page_number":197,"box":{"x":68,"y":201,"width":782,"height":11}},{"id":"b72f4a05-8ea5-4510-85e7-89828bfff9b6","block_type":"box","text":"executive management of the companies in which our clients are invested.","page_number":197,"box":{"x":69,"y":216,"width":531,"height":11}},{"id":"2985e502-2b13-44a2-b5b6-8456e29adf20","block_type":"box","text":"ABOUT BLACKROCK ACTIVE INVESTMENT STEWARDSHIP","page_number":197,"box":{"x":277,"y":246,"width":424,"height":9}},{"id":"d74a3583-e9fd-4484-a935-7975d0eb0085","block_type":"box","text":"BlackRock Active Investment Stewardship (BAIS) is a specialist team within the Por tfolio Management Group and","page_number":197,"box":{"x":102,"y":265,"width":804,"height":11}},{"id":"da0b99a3-4e12-4923-8f5f-6ae8345e5ff5","block_type":"box","text":"manages BlackRock’s stewardship engagement and voting on behalf of clients invested in active strategies globally.","page_number":197,"box":{"x":69,"y":280,"width":826,"height":11}},{"id":"0b85e64d-c868-40e3-bd94-2a2a751dd424","block_type":"box","text":"BAIS is also responsible for engagement with issuers in index fixed income strategies, where appropriate. Our","page_number":197,"box":{"x":70,"y":295,"width":783,"height":11}},{"id":"e86d4ce1-2351-44e8-a66e-1ce0a0049ad3","block_type":"box","text":"activities are informed by these Global Engagement and Voting Guidelines (the “Guidelines”) and insights from active","page_number":197,"box":{"x":69,"y":309,"width":834,"height":12}},{"id":"a05523cf-acfc-44d7-82fe-d61dea82f754","block_type":"box","text":"investment analysts and por tfolio managers, with whom we work closely in engaging companies and voting at","page_number":197,"box":{"x":70,"y":324,"width":779,"height":12}},{"id":"7e3f6f8f-5874-49b0-87ed-37a5c405ada6","block_type":"box","text":"shareholder meetings.","page_number":197,"box":{"x":69,"y":339,"width":158,"height":11}},{"id":"9a08ba63-34c9-4d1a-84f4-e80d1877fbdd","block_type":"box","text":"Engagement with public companies is the foundation of our approach to stewardship within fundamental active","page_number":197,"box":{"x":102,"y":358,"width":789,"height":11}},{"id":"26221083-9c5e-49ce-8e86-8afa931b3574","block_type":"box","text":"investing.","page_number":197,"box":{"x":70,"y":373,"width":65,"height":11}},{"id":"28a5820b-20ff-44ed-8097-ab50f9e3c8e4","block_type":"box","text":"3","page_number":197,"box":{"x":137,"y":373,"width":4,"height":5}},{"id":"7904fe2e-d7c8-425f-a690-576aaf2bb194","block_type":"box","text":"Through direct dialogue with company leadership, we seek to understand their businesses and how they","page_number":197,"box":{"x":146,"y":373,"width":744,"height":11}},{"id":"5082562f-483b-4d00-9694-217ac1e36521","block_type":"box","text":"manage risks and oppor tunities to deliver durable, risk-adjusted financial returns. Por tfolio managers and","page_number":197,"box":{"x":69,"y":387,"width":751,"height":12}},{"id":"8440c445-902d-45a8-88f0-1b660965f215","block_type":"box","text":"stewardship specialists may engage jointly or independently on material corporate governance matters. Our","page_number":197,"box":{"x":69,"y":402,"width":765,"height":12}},{"id":"0070f3cc-b470-46a1-8283-5ba80ff30867","block_type":"box","text":"discussions focus on topics relevant to a company’s success over time, including governance and leadership,","page_number":197,"box":{"x":69,"y":417,"width":782,"height":12}},{"id":"5c9e4775-7d61-4576-b1dd-18a81ab00fd8","block_type":"box","text":"corporate strategy, capital structure and financial per formance, operations and material sustainability-related risks,","page_number":197,"box":{"x":69,"y":432,"width":820,"height":11}},{"id":"4a6ea3fc-1069-4468-8bd1-8165ee4ca3ee","block_type":"box","text":"as well as macro-economic, geopolitical and sector dynamics. We aim to be constructive investors and are generally","page_number":197,"box":{"x":69,"y":447,"width":828,"height":11}},{"id":"6a727344-3857-4e06-a88d-861ac2996f5b","block_type":"box","text":"suppor tive of management teams that have a track record of financial value creation. We aim to build and maintain","page_number":197,"box":{"x":69,"y":462,"width":821,"height":11}},{"id":"2a648ca8-2298-4fb5-be19-67ba5931223a","block_type":"box","text":"strong relationships with company leadership based on open dialogue and mutual respect.","page_number":197,"box":{"x":69,"y":477,"width":645,"height":11}},{"id":"da3eb795-d905-4857-9503-daf69161c824","block_type":"box","text":"Different active equity strategies may implement these voting guidelines differently, as a result of the latitude","page_number":197,"box":{"x":102,"y":495,"width":780,"height":12}},{"id":"488e211b-ec54-4798-acd8-7bdcde605fc0","block_type":"box","text":"each por tfolio manager has to make independent voting decisions on their holdings. For example, BAIS will generally","page_number":197,"box":{"x":69,"y":510,"width":831,"height":11}},{"id":"b829ffc7-36a7-48c1-9580-34ac0acfb560","block_type":"box","text":"vote the holdings in Systematic Active Equity por tfolios in accordance with these guidelines. We provide voting","page_number":197,"box":{"x":68,"y":525,"width":787,"height":11}},{"id":"627b299d-b052-428d-a7ea-b98fca2a2643","block_type":"box","text":"recommendations to fundamental equity por tfolio managers, who may determine to vote differently based on each","page_number":197,"box":{"x":69,"y":540,"width":816,"height":11}},{"id":"0f2acb80-449b-4035-9a2a-366c518ad8a4","block_type":"box","text":"por tfolio’s investment objectives and strategy.","page_number":197,"box":{"x":70,"y":555,"width":327,"height":11}},{"id":"6e8619d6-c695-4ccd-8ba9-7d3493e96451","block_type":"box","text":"These guidelines discuss BAIS’ views on corporate governance topics on which we may engage with","page_number":197,"box":{"x":101,"y":574,"width":711,"height":11}},{"id":"14f21136-361c-48e1-8671-0400098d128c","block_type":"box","text":"management teams and board directors","page_number":197,"box":{"x":69,"y":589,"width":285,"height":11}},{"id":"9f050afc-9d5e-4f1c-bae9-0e186a10a95b","block_type":"box","text":"4","page_number":197,"box":{"x":355,"y":589,"width":5,"height":4}},{"id":"96abebb9-2bfb-43fd-81b6-4254a81de4c2","block_type":"box","text":"and on matters that routinely come to a shareholder vote. We recognize that","page_number":197,"box":{"x":366,"y":589,"width":544,"height":11}},{"id":"203d6ef8-4653-4c51-9e99-2ee8eef7c5d6","block_type":"box","text":"accepted corporate governance norms can differ across markets, and believe these guidelines represent globally","page_number":197,"box":{"x":69,"y":603,"width":807,"height":11}},{"id":"33346b8a-6354-410b-b36a-4bf970411d31","block_type":"box","text":"applicable elements of governance that suppor t a company’s ability to manage material risks and oppor tunities and","page_number":197,"box":{"x":69,"y":618,"width":827,"height":11}},{"id":"1032ffb9-2a99-447b-a7d7-c1ae6cce18b1","block_type":"box","text":"deliver financial returns to investors. Generally, we believe companies should observe accepted corporate governance","page_number":197,"box":{"x":69,"y":633,"width":840,"height":11}},{"id":"861f9937-e269-4155-8711-201753970418","block_type":"box","text":"norms within their local markets or, par ticularly in markets without well-established norms, aspire to widely","page_number":197,"box":{"x":69,"y":648,"width":762,"height":11}},{"id":"3083f161-ad8c-4927-bd3c-2ee9c889d923","block_type":"box","text":"recognized international best practices. As one of many minority shareholders, BlackRock cannot – and does not try","page_number":197,"box":{"x":69,"y":663,"width":827,"height":11}},{"id":"d83181e6-42d6-4823-aae0-8cee5d535f0c","block_type":"box","text":"to – direct a company’s strategy or its implementation. We look to companies to provide disclosures that explain how","page_number":197,"box":{"x":68,"y":678,"width":837,"height":11}},{"id":"34fea965-ea56-474c-8136-aac9c96aee59","block_type":"box","text":"their approach to corporate governance best aligns with the financial interests of their investors.","page_number":197,"box":{"x":68,"y":692,"width":687,"height":12}},{"id":"53f51a08-e0ba-4918-ae41-aa81a03bd362","block_type":"box","text":"OUR APPROACH TO STEWARDSHIP WITHIN ACTIVE EQUITIES","page_number":197,"box":{"x":263,"y":722,"width":451,"height":11}},{"id":"d9c36bae-d981-4bd1-b26b-110f9a6ab063","block_type":"box","text":"Voting at a company’s shareholder meeting is a right of share ownership and a core principle of corporate","page_number":197,"box":{"x":101,"y":741,"width":753,"height":12}},{"id":"7bec6cef-8138-4a0e-90fa-d7ae3af7a531","block_type":"box","text":"governance. The voting rights attached to clients’ holdings are an impor tant mechanism for investors to express","page_number":197,"box":{"x":68,"y":756,"width":801,"height":11}},{"id":"74d64b36-b440-45a7-9ffa-70560bee4d44","block_type":"box","text":"suppor t for, or concern about, a company’s per formance. As a fiduciary, BlackRock is legally required to make proxy","page_number":197,"box":{"x":69,"y":771,"width":829,"height":11}},{"id":"dda48e89-bbd5-4d04-b1b9-27d589cdb10a","block_type":"box","text":"voting determinations, on behalf of clients who have delegated voting authority to us, in a manner consistent with","page_number":197,"box":{"x":68,"y":786,"width":809,"height":11}},{"id":"f3d977e6-3c6f-40bf-b753-cb11ea1a3b42","block_type":"box","text":"BlackRock’s contractual arrangements with clients and funds.","page_number":197,"box":{"x":70,"y":801,"width":438,"height":11}},{"id":"6559cc49-273d-47e2-8591-cdb0649ce675","block_type":"box","text":"3","page_number":197,"box":{"x":69,"y":830,"width":4,"height":5}},{"id":"c6c8285e-8914-4ae8-826d-80663bf081a4","block_type":"box","text":"On February 11, 2025, the U.S. Securities and Exchange Commission (SEC) staff issued updated guidance for","page_number":197,"box":{"x":79,"y":830,"width":790,"height":11}},{"id":"22f84e2d-400b-4c38-8a69-7260af85f3cc","block_type":"box","text":"shareholders to maintain their eligibility to repor t their beneficial ownership under Schedule 13G of the Exchange Act.","page_number":197,"box":{"x":69,"y":845,"width":836,"height":11}},{"id":"a23a39c7-8cad-4271-be3c-567699d155fc","block_type":"box","text":"We comply fully with these requirements and do not engage with por tfolio companies for the purpose, or with the","page_number":197,"box":{"x":68,"y":860,"width":805,"height":11}},{"id":"64e1c5b1-8ba4-48bc-a01b-f39b3360622f","block_type":"box","text":"effect, of changing or influencing control of the company.","page_number":197,"box":{"x":69,"y":875,"width":403,"height":12}},{"id":"e8730a75-e68f-4618-bea5-008a54b9e6dd","block_type":"box","text":"4","page_number":197,"box":{"x":69,"y":893,"width":4,"height":5}},{"id":"fa908acb-10ce-4fe7-a3a4-3ab149f99ba8","block_type":"box","text":"References to the board, board directors or non-executive directors should be understood to include supervisory","page_number":197,"box":{"x":79,"y":893,"width":801,"height":11}},{"id":"bd5f2b13-5d1c-48db-97c1-d9f8bfdcd1ec","block_type":"box","text":"boards and their members, where relevant.","page_number":197,"box":{"x":69,"y":908,"width":306,"height":11}},{"id":"fc7e3400-6d46-4fd2-82a5-ee2d74799476","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":197,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"652d94c6-8b78-45bd-8099-324d45779bf0","block_type":"box","text":"Global Engagement and Voting Guidelines | 2","page_number":197,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"4fd484dd-49aa-4799-aa02-3286240aa4bc","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":197,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"c93122cd-98ea-450e-87ad-d219ed6de98f","block_type":"box","text":"In general, we tend to suppor t the recommendations of the board of directors and management. As indicated","page_number":198,"box":{"x":102,"y":45,"width":778,"height":11}},{"id":"15c0e1a6-3beb-469d-a9fc-705033105050","block_type":"box","text":"below, we may vote against management recommendations when we have concerns about how companies are","page_number":198,"box":{"x":69,"y":60,"width":788,"height":11}},{"id":"fc66f63c-4ab6-4fd3-967d-fa3ba3dc2c2c","block_type":"box","text":"serving the financial interests of our clients as their shareholders. BAIS takes a globally consistent approach to","page_number":198,"box":{"x":69,"y":74,"width":795,"height":12}},{"id":"2988e156-fbe0-49f8-8d0c-f8611b1eb7a1","block_type":"box","text":"voting but considers the different corporate governance regulations and norms across markets. Votes are determined","page_number":198,"box":{"x":68,"y":89,"width":839,"height":12}},{"id":"fbc5af58-6836-4023-815b-befa3f7f9781","block_type":"box","text":"on a case-by-case basis, in the context of a company’s situation and the investment mandate we have from clients.","page_number":198,"box":{"x":69,"y":104,"width":823,"height":11}},{"id":"6012b87b-102a-4e0b-ba84-6b1abc1956e7","block_type":"box","text":"Please see page 19 for more information about how we fulfill and oversee our investment stewardship","page_number":198,"box":{"x":69,"y":119,"width":729,"height":11}},{"id":"2052d22c-5557-45c1-b288-5a59626b438d","block_type":"box","text":"responsibilities for BlackRock’s non-index equity strategies.","page_number":198,"box":{"x":69,"y":134,"width":423,"height":11}},{"id":"fa5a0824-836d-4887-a9a8-0bc2a17b6cf4","block_type":"box","text":"5","page_number":198,"box":{"x":493,"y":134,"width":5,"height":5}},{"id":"34f86618-c1a5-4910-8537-b6f307aedc4a","block_type":"box","text":"OUR APPROACH TO STEWARDSHIP WITHIN FIXED INCOME","page_number":198,"box":{"x":272,"y":164,"width":434,"height":9}},{"id":"b5ed05a6-4e5f-43aa-9fd5-c0772b6f24a6","block_type":"box","text":"Although fixed income investors do not have the right to vote at shareholder meetings, issuer engagement is a","page_number":198,"box":{"x":101,"y":183,"width":788,"height":11}},{"id":"664813f0-4a15-4008-a3ca-d5af291a9aee","block_type":"box","text":"component of fixed income investment strategies at BlackRock, par ticularly for those with sustainability objectives in","page_number":198,"box":{"x":69,"y":198,"width":831,"height":11}},{"id":"4e3c7937-0de5-4696-ab7b-27d7bcbbc6db","block_type":"box","text":"addition to financial objectives. Most corporate governance-related fixed income engagements are under taken in","page_number":198,"box":{"x":69,"y":212,"width":801,"height":12}},{"id":"55a8f68d-f828-49ff-b240-2bb82d4f0dec","block_type":"box","text":"conjunction with the active investment stewardship team, and often active equity investors. In addition to the topics","page_number":198,"box":{"x":69,"y":227,"width":824,"height":11}},{"id":"20f1572c-ca43-4c97-a751-b2b345af38ef","block_type":"box","text":"listed below, engagement with fixed income investment teams may help inform an issuer’s approach to structuring","page_number":198,"box":{"x":70,"y":242,"width":816,"height":11}},{"id":"5fad144f-c780-4e6b-b9f5-dddb9dcb4ee2","block_type":"box","text":"specialist issuances and the standard terms and information in bond documentation.","page_number":198,"box":{"x":69,"y":257,"width":608,"height":11}},{"id":"4e806155-482d-4bd6-9006-d58de93e8af1","block_type":"box","text":"5","page_number":198,"box":{"x":69,"y":302,"width":4,"height":4}},{"id":"0e460ea7-d8be-4113-9f1e-e93eac693a21","block_type":"box","text":"Non-index equity strategies include active equity holdings in BlackRock’s fundamental equity, systematic equity and","page_number":198,"box":{"x":79,"y":301,"width":820,"height":11}},{"id":"5c642332-8c83-4a60-89dd-f604c2d3b51b","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":198,"box":{"x":69,"y":316,"width":822,"height":12}},{"id":"95f25a1c-d42e-4510-95c7-77ed6cc44466","block_type":"box","text":"extent those strategies hold voting securities or conduct issuer engagements.","page_number":198,"box":{"x":69,"y":332,"width":554,"height":11}},{"id":"ba69ad45-3d60-48f6-946b-b20bd2e983f4","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":198,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"06348fea-e024-4f4c-add4-b8bbdace96e3","block_type":"box","text":"Global Engagement and Voting Guidelines | 3","page_number":198,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"2a109c22-988f-498c-b66a-db2ca8c69904","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":198,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"994230ec-1277-4667-b731-fa5bd9c065fa","block_type":"box","text":"BOARDS OF DIRECTORS","page_number":199,"box":{"x":400,"y":45,"width":178,"height":9}},{"id":"b7de3897-89d0-450f-86fc-f6159d67ee37","block_type":"box","text":"Roles and responsibilities","page_number":199,"box":{"x":69,"y":67,"width":186,"height":11}},{"id":"bfc21db6-03c8-4a4e-8c14-42886e63b054","block_type":"box","text":"There is widespread consensus that the foundation of good corporate governance is an effective board of","page_number":199,"box":{"x":101,"y":86,"width":754,"height":11}},{"id":"4a4b4f30-957a-4505-810b-9b063b74b55e","block_type":"box","text":"directors that is able to advise and supervise management in an independent and objective manner.","page_number":199,"box":{"x":69,"y":101,"width":715,"height":11}},{"id":"83f2a4d5-e20f-4114-9c9e-03aa1f20e88c","block_type":"box","text":"6","page_number":199,"box":{"x":786,"y":101,"width":4,"height":5}},{"id":"3a5db173-a674-4cba-82ae-13c1ac362bce","block_type":"box","text":"We look to the board of directors (hereafter the “board”) to have an oversight role in the establishment and","page_number":199,"box":{"x":101,"y":119,"width":765,"height":12}},{"id":"8bda63c9-725d-49e8-954c-d3f50c8ecedb","block_type":"box","text":"realization of a company’s strategy, purpose and culture. These constructs are interdependent and, when aligned,","page_number":199,"box":{"x":69,"y":134,"width":811,"height":12}},{"id":"073b2e75-cf6e-4d86-92a1-0a9cc9c77f1f","block_type":"box","text":"can better position a company to be resilient in the face of a changing business environment, help reduce the risks","page_number":199,"box":{"x":69,"y":149,"width":822,"height":11}},{"id":"06be6e61-d163-4eec-b089-599bde15d74c","block_type":"box","text":"of corporate or employee misconduct, and attract and retain the caliber of workers necessary to deliver financial","page_number":199,"box":{"x":69,"y":164,"width":799,"height":11}},{"id":"adc8aa7d-06d1-4f9e-859b-7a74c987c4c0","block_type":"box","text":"per formance over time.","page_number":199,"box":{"x":70,"y":179,"width":164,"height":11}},{"id":"46dd8fff-6214-42cf-80bf-a6adbc9e7443","block_type":"box","text":"In overseeing the management of the company, the board ensures the necessary resources, policies and","page_number":199,"box":{"x":102,"y":198,"width":750,"height":11}},{"id":"6a202a12-f75c-4372-a5da-cdb799eb7f43","block_type":"box","text":"procedures are in place to help management meet its strategic objectives within an agreed risk tolerance.","page_number":199,"box":{"x":70,"y":213,"width":753,"height":11}},{"id":"425acb37-529e-47fe-982f-c20f5c67e9c9","block_type":"box","text":"One of the most impor tant responsibilities of the board is to appoint, and remove as necessary, the chief","page_number":199,"box":{"x":102,"y":231,"width":753,"height":11}},{"id":"7edb1aeb-186a-40cf-987d-10621df26699","block_type":"box","text":"executive officer (“CEO”). In addition, the board plays a meaningful role in monitoring the per formance of the CEO","page_number":199,"box":{"x":69,"y":246,"width":811,"height":11}},{"id":"dbca5812-906a-4b8e-8824-0e5141b2f90c","block_type":"box","text":"and other key executives, determining executive compensation, ensuring a rigorous audit, overseeing strategy","page_number":199,"box":{"x":69,"y":261,"width":783,"height":11}},{"id":"c682cd0c-7ec1-43de-a356-466d83de4da8","block_type":"box","text":"execution and risk management and engaging with shareholders, and other stakeholders, as necessary.","page_number":199,"box":{"x":69,"y":276,"width":742,"height":11}},{"id":"85cb8f93-fdab-419c-ba89-529d34e5cfef","block_type":"box","text":"Composition and effectiveness","page_number":199,"box":{"x":69,"y":298,"width":224,"height":11}},{"id":"599d1184-d10a-4e34-be04-1918390d5b3c","block_type":"box","text":"Appointment process","page_number":199,"box":{"x":68,"y":317,"width":152,"height":11}},{"id":"479f3803-f023-42bd-afc9-35d94f0ff454","block_type":"box","text":"A formal and transparent process for identifying and appointing director candidates is critical to ensuring the","page_number":199,"box":{"x":101,"y":335,"width":773,"height":12}},{"id":"3935b6a6-54dc-4828-ab05-278ff066ffb8","block_type":"box","text":"board is composed of directors with the appropriate mix of skills and experience. Generally, the board or a sub","page_number":199,"box":{"x":69,"y":350,"width":792,"height":11}},{"id":"81a2a3f6-46d6-4324-9c95-9e349171f724","block_type":"box","text":"committee determines the general criteria given the company’s circumstances (","page_number":199,"box":{"x":69,"y":365,"width":568,"height":11}},{"id":"ab1d53b4-f139-4f3f-a847-af4ae2685e57","block_type":"box","text":"e.g.","page_number":199,"box":{"x":638,"y":367,"width":25,"height":9}},{"id":"7897cddd-5fd2-4270-a7ac-965c9521c51d","block_type":"box","text":", sector, maturity, geographic","page_number":199,"box":{"x":666,"y":365,"width":204,"height":11}},{"id":"51642655-ef44-4dea-8a3e-369e074b31e9","block_type":"box","text":"footprint) and any additional criteria for a specific role being filled (","page_number":199,"box":{"x":68,"y":380,"width":474,"height":11}},{"id":"6a3440a7-7e69-4f23-b549-1e24604af831","block_type":"box","text":"e.g.","page_number":199,"box":{"x":544,"y":381,"width":25,"height":10}},{"id":"863bff34-3091-4b2a-9796-e2ec35a6cd24","block_type":"box","text":", financial exper tise, industry track record). To","page_number":199,"box":{"x":571,"y":380,"width":327,"height":11}},{"id":"1c54d2fd-f64c-42e5-9711-8189d8f31779","block_type":"box","text":"inform the process, we encourage companies to review the skills and experience of incumbent directors to identify","page_number":199,"box":{"x":70,"y":395,"width":815,"height":11}},{"id":"5d793b62-c236-458d-8cde-7bb44a6702dc","block_type":"box","text":"any gaps and whether the skills and experience of a director candidate would be additive. We welcome disclosures","page_number":199,"box":{"x":69,"y":410,"width":817,"height":11}},{"id":"61fed202-6e28-448b-be2a-9d28edae62e2","block_type":"box","text":"that explain how the board considered different skills and experience to ensure that the directors collectively can be","page_number":199,"box":{"x":68,"y":425,"width":829,"height":11}},{"id":"6bf40436-5a70-4f74-a303-6e4343390a24","block_type":"box","text":"effective in fulfilling their responsibilities. We assess a company’s board composition against that of its peer group","page_number":199,"box":{"x":69,"y":439,"width":821,"height":12}},{"id":"b0e75f3a-bd57-4031-97dd-8987259a20af","block_type":"box","text":"and local market requirements.","page_number":199,"box":{"x":69,"y":455,"width":221,"height":10}},{"id":"361945e5-0933-4ca7-8ae6-f9c29752fa6f","block_type":"box","text":"Shareholders periodically vote to elect directors to serve on the board. We do not prescribe any par ticular board","page_number":199,"box":{"x":102,"y":473,"width":798,"height":11}},{"id":"9cf1248e-f746-4ac0-a1fd-279b005ad4dc","block_type":"box","text":"composition in our engagements or voting but seek to understand how well placed a board is to act in investors’","page_number":199,"box":{"x":69,"y":488,"width":800,"height":11}},{"id":"6745b7f0-ad87-4481-bb85-c02e7c2a7533","block_type":"box","text":"interests. We may vote against the election of the most senior independent director, or the chair of the relevant","page_number":199,"box":{"x":70,"y":503,"width":794,"height":11}},{"id":"b2a7ebee-c1cc-421e-928e-22f9b5788275","block_type":"box","text":"committee, where a company has not demonstrated it has an appointment process that results in a high functioning","page_number":199,"box":{"x":69,"y":517,"width":830,"height":12}},{"id":"0f83462a-e970-4cb5-a5b9-299b236f861f","block_type":"box","text":"board with the appropriate complement of skills and experience amongst the directors to suppor t strong financial","page_number":199,"box":{"x":69,"y":532,"width":808,"height":12}},{"id":"67c2b9ff-b2d9-48d2-a925-5f18ae0d0676","block_type":"box","text":"per formance over time. We may vote against newly nominated directors who do not seem to have the appropriate","page_number":199,"box":{"x":70,"y":547,"width":808,"height":12}},{"id":"b8c8715a-473e-4b12-aece-c1dc27093965","block_type":"box","text":"skills or experience to contribute to the board’s effectiveness.","page_number":199,"box":{"x":69,"y":562,"width":442,"height":11}},{"id":"91ffc97e-42d1-49ad-a4a5-fcadbc1bd7dd","block_type":"box","text":"Independence","page_number":199,"box":{"x":70,"y":585,"width":99,"height":10}},{"id":"9b63cb0b-4369-40e2-b496-81f4673f3863","block_type":"box","text":"Director independence from management, significant shareholders or other stakeholders (","page_number":199,"box":{"x":102,"y":603,"width":642,"height":11}},{"id":"1cda5f3b-eb4a-4dde-a9a9-44df2c78835f","block_type":"box","text":"e.g.","page_number":199,"box":{"x":746,"y":605,"width":25,"height":9}},{"id":"13ff7a3f-06f8-472d-a5dc-7cdbfb48d342","block_type":"box","text":", government or","page_number":199,"box":{"x":773,"y":604,"width":111,"height":10}},{"id":"94045701-8945-467b-b5cf-4c1561b740b9","block_type":"box","text":"employees) is of paramount impor tance to the protection of the interests of minority shareholders such as","page_number":199,"box":{"x":69,"y":618,"width":759,"height":11}},{"id":"9a7337fc-5a6a-4ed4-91ca-48c0412c07ae","block_type":"box","text":"BlackRock’s clients. We consider it good practice for at least half the directors to be independent and free from","page_number":199,"box":{"x":70,"y":633,"width":793,"height":11}},{"id":"7aa68967-e465-4e24-a8c0-1977f6d501cb","block_type":"box","text":"conflicts of interest or undue influence.","page_number":199,"box":{"x":69,"y":648,"width":278,"height":9}},{"id":"a57a0ded-eeac-4394-af9c-0a74a71d1734","block_type":"box","text":"7","page_number":199,"box":{"x":349,"y":648,"width":4,"height":5}},{"id":"707b2a62-1375-4187-b0be-7f5dccc5ac5d","block_type":"box","text":"This also helps to ensure that board committees are composed of a","page_number":199,"box":{"x":358,"y":648,"width":486,"height":11}},{"id":"e4d21707-8702-4acf-aee0-72385dfd55cd","block_type":"box","text":"sufficient number of independent directors. Companies domiciled in markets with a higher threshold for board","page_number":199,"box":{"x":69,"y":663,"width":783,"height":11}},{"id":"234dd60d-fa3a-406b-bed1-975166194f19","block_type":"box","text":"independence should meet those local requirements.","page_number":199,"box":{"x":70,"y":678,"width":378,"height":10}},{"id":"cab639dd-244f-4968-b580-fa4e8c83926f","block_type":"box","text":"We may vote against the election of non-independent directors if the board does not have a sufficient balance of","page_number":199,"box":{"x":101,"y":696,"width":803,"height":11}},{"id":"5dcdfc10-371b-4b0e-a2a1-5fad97503638","block_type":"box","text":"independence. We may also vote against the election of the chair of the committee responsible for board","page_number":199,"box":{"x":70,"y":711,"width":748,"height":11}},{"id":"8b5a4f82-0d59-420a-a34d-2920e99782a9","block_type":"box","text":"composition if this is a perennial issue.","page_number":199,"box":{"x":69,"y":726,"width":280,"height":11}},{"id":"9f86e6a1-4b3d-4bef-bd3f-cdd622f6a3f3","block_type":"box","text":"6","page_number":199,"box":{"x":69,"y":756,"width":4,"height":4}},{"id":"1a0c1b41-9f49-4c53-aeb5-479d6d87556d","block_type":"box","text":"See the Corporate Governance Codes of Germany, Japan, and the UK, as well as the corporate governance","page_number":199,"box":{"x":93,"y":755,"width":763,"height":11}},{"id":"9b596239-dcac-4d6c-bfe3-30e9c1bf1cf4","block_type":"box","text":"principles of the US Business Roundtable as examples.","page_number":199,"box":{"x":94,"y":770,"width":394,"height":11}},{"id":"c365ae84-0a6f-4ab8-8bd2-4af2eedc6c66","block_type":"box","text":"7","page_number":199,"box":{"x":69,"y":788,"width":4,"height":5}},{"id":"9fa3311c-d883-45a2-8b40-ad657872ee4c","block_type":"box","text":"Common impediments to independence may include but are not limited to: current or recent employment at the","page_number":199,"box":{"x":93,"y":788,"width":795,"height":11}},{"id":"64c15bf1-c231-4602-b12c-0a971de934ee","block_type":"box","text":"company or a subsidiary; being, or representing, a shareholder with a substantial shareholding in the company;","page_number":199,"box":{"x":93,"y":803,"width":793,"height":11}},{"id":"91445f99-9f90-4d20-b50b-477d6f2935d6","block_type":"box","text":"interlocking directorships; lengthy tenure, and having any other interest, business, or other relationship which","page_number":199,"box":{"x":94,"y":818,"width":778,"height":11}},{"id":"2040e48b-1fd5-436b-afac-687e8cc39dee","block_type":"box","text":"could, or could reasonably be perceived to, materially inter fere with a director’s ability to act in the best interests","page_number":199,"box":{"x":93,"y":833,"width":807,"height":11}},{"id":"bc42d560-8599-4527-9dea-4bddc1911c22","block_type":"box","text":"of the company and shareholders.","page_number":199,"box":{"x":93,"y":848,"width":242,"height":11}},{"id":"c9ab5728-1886-4c91-bad7-8204b0c91f54","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":199,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"9e4d7af4-83dc-4b9c-b7a4-43cc3939625f","block_type":"box","text":"Global Engagement and Voting Guidelines | 4","page_number":199,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"71102119-75dc-4f0a-890f-87be076bae96","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":199,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"ee770827-fd15-4a60-93bc-4bdbd2ee9ccd","block_type":"box","text":"Independent board leadership","page_number":200,"box":{"x":70,"y":45,"width":212,"height":11}},{"id":"68375378-e864-450b-9ed3-4d304d1e4de8","block_type":"box","text":"Practices across markets differ, as do board structures, but we observe two main approaches to independent","page_number":200,"box":{"x":102,"y":63,"width":784,"height":11}},{"id":"1a35902d-a0ee-4f33-8068-2bd422c5b751","block_type":"box","text":"board leadership. One is a non-executive, independent chair of the board who is responsible for leading the board in","page_number":200,"box":{"x":69,"y":78,"width":827,"height":11}},{"id":"40547bad-cdff-4168-b3f1-bb03ae94e2b4","block_type":"box","text":"the effective exercise of its duties. The other is a lead or senior independent director, who is responsible for","page_number":200,"box":{"x":68,"y":93,"width":774,"height":11}},{"id":"9879f34c-af8e-434d-8121-810ccc2d4ac9","block_type":"box","text":"coordinating with the other non-executive directors and working closely with the executive chair on the board agenda","page_number":200,"box":{"x":69,"y":108,"width":826,"height":11}},{"id":"8256be15-e8ba-4946-9d46-933a21afb476","block_type":"box","text":"and other board procedures. In this case, the executive chair and the lead independent director work together to","page_number":200,"box":{"x":69,"y":123,"width":801,"height":11}},{"id":"310209e5-25c8-474f-a95b-eebe0c8f6b7e","block_type":"box","text":"ensure the board is effectively fulfilling its responsibilities. In our view, the independent leader of the board, and/or","page_number":200,"box":{"x":69,"y":138,"width":823,"height":11}},{"id":"92bd79fa-06a4-4c22-93e0-bbb4910415e3","block_type":"box","text":"the chair of a relevant committee, should be available to investors to discuss governance matters such as CEO","page_number":200,"box":{"x":68,"y":152,"width":793,"height":12}},{"id":"2450ff33-e3cb-4860-8d9d-2eda2ef245be","block_type":"box","text":"succession, executive pay, and board per formance. We look to boards to explain their board leadership model and","page_number":200,"box":{"x":69,"y":167,"width":816,"height":11}},{"id":"2250eaab-db83-47d8-86d4-3482662aa9be","block_type":"box","text":"how it serves the interests of shareholders.","page_number":200,"box":{"x":69,"y":182,"width":311,"height":9}},{"id":"b8bbb6bd-16d2-426f-9b36-2421a9517713","block_type":"box","text":"We may vote against the election of the chair of the committee responsible for board composition if there is not","page_number":200,"box":{"x":101,"y":201,"width":798,"height":11}},{"id":"f16fd5d1-4a73-4e56-8294-14197d02b956","block_type":"box","text":"an identified independent leader of the board with clear responsibilities for board per formance. We may vote against","page_number":200,"box":{"x":69,"y":216,"width":831,"height":11}},{"id":"1a64f34b-fa66-4e71-87a5-0abc987772df","block_type":"box","text":"the most senior independent director if the board has a policy of not engaging with shareholders.","page_number":200,"box":{"x":68,"y":231,"width":691,"height":11}},{"id":"5c6c8376-5929-4832-b4f6-36a1a97a329d","block_type":"box","text":"Tenure and succession","page_number":200,"box":{"x":70,"y":253,"width":162,"height":9}},{"id":"2c32c1c1-eada-4b1b-be30-01741682b9e3","block_type":"box","text":"In our view, it is good practice for boards to establish the length of time a director would normally be expected to","page_number":200,"box":{"x":102,"y":272,"width":803,"height":11}},{"id":"e71431bd-1319-4463-b12d-cf23f6d37932","block_type":"box","text":"serve, in line with market norms where those exist. We find it helpful when companies disclose their approach to","page_number":200,"box":{"x":69,"y":286,"width":805,"height":11}},{"id":"fa29985c-e255-47dd-9f3b-1052ec741a75","block_type":"box","text":"director tenure par ticularly around the contributions of directors who have served for longer periods than typically","page_number":200,"box":{"x":69,"y":301,"width":806,"height":12}},{"id":"bc831f63-ad37-4152-8ca0-c453b7b15bc2","block_type":"box","text":"provided for under local practice. In our experience, long-serving directors could become less independent given their","page_number":200,"box":{"x":70,"y":316,"width":833,"height":12}},{"id":"5ea022f8-68d1-4ee1-8f74-4697e758d19e","block_type":"box","text":"long-term relationship with management and involvement in past board decisions.","page_number":200,"box":{"x":70,"y":331,"width":581,"height":11}},{"id":"7238dc6a-d460-4c9d-8bc1-d8c19b650c0d","block_type":"box","text":"Succession planning for board roles helps achieve the appropriate cadence of turnover that balances renewal","page_number":200,"box":{"x":102,"y":350,"width":779,"height":11}},{"id":"1b56cd04-a38e-48bc-aed8-0012f883c7d3","block_type":"box","text":"through the regular introduction of directors with fresh perspectives and exper tise with continuity through the","page_number":200,"box":{"x":68,"y":365,"width":777,"height":11}},{"id":"1dc37a83-abb0-4a7c-b5ba-f6c5eb3109e1","block_type":"box","text":"retention of directors with long-term knowledge of the board and company.","page_number":200,"box":{"x":69,"y":379,"width":528,"height":12}},{"id":"b4df8d62-8cf9-4e08-9f78-2b3b60c25155","block_type":"box","text":"In markets where there is not specific director tenure guidance from regulation or corporate governance best","page_number":200,"box":{"x":102,"y":398,"width":774,"height":11}},{"id":"fdd59315-35a5-413b-baee-bc7a9193a18d","block_type":"box","text":"practices, we may vote against the election of the chair of the committee responsible for board composition if a","page_number":200,"box":{"x":70,"y":413,"width":795,"height":11}},{"id":"43dc6d18-08e0-4734-a658-a7b71a39ba48","block_type":"box","text":"company does not clearly disclose its approach to director tenure and board renewal. We may vote against the","page_number":200,"box":{"x":69,"y":428,"width":788,"height":11}},{"id":"e7755866-ef45-4caa-8313-6409ecc71e0d","block_type":"box","text":"election of directors who have served for more years than is typical in markets with specific guidance, where the case","page_number":200,"box":{"x":69,"y":443,"width":839,"height":11}},{"id":"a4da60d6-9fc8-414f-af45-1b95d844689a","block_type":"box","text":"for their continued service is not evident.","page_number":200,"box":{"x":68,"y":458,"width":292,"height":9}},{"id":"d9dcf52d-c5d3-4fa5-90cb-9c79ff5723bb","block_type":"box","text":"Capacity","page_number":200,"box":{"x":70,"y":480,"width":60,"height":11}},{"id":"6a42fcb9-395f-478c-9a3b-2d422b8fa472","block_type":"box","text":"To be effective and engaged, directors need to have the time and energy to commit to the role. In our view, an","page_number":200,"box":{"x":101,"y":499,"width":784,"height":11}},{"id":"73c2deb0-7e4d-4ad0-ac8c-164bef6b6429","block_type":"box","text":"effective board will assess the ability of its members to maintain an appropriate focus on board matters and the","page_number":200,"box":{"x":69,"y":513,"width":801,"height":12}},{"id":"8eb16028-956f-4f57-a9d5-643307bea267","block_type":"box","text":"company taking into consideration competing responsibilities. We recognize that board leadership roles vary across","page_number":200,"box":{"x":69,"y":529,"width":823,"height":11}},{"id":"ebb82c63-9999-4392-a607-bd360cf57fae","block_type":"box","text":"markets in responsibilities and required time commitment but note that they are generally more intensive than a","page_number":200,"box":{"x":69,"y":543,"width":800,"height":11}},{"id":"b3962106-a636-4ee7-a345-8c4a866997c7","block_type":"box","text":"standard directorship. We will take local norms and practices into consideration when making our voting","page_number":200,"box":{"x":69,"y":558,"width":741,"height":11}},{"id":"07cb66cd-beeb-45bb-b7ee-20f9e78b2087","block_type":"box","text":"determinations across markets.","page_number":200,"box":{"x":69,"y":573,"width":226,"height":9}},{"id":"d7025b44-29cc-4a49-a480-eb79d0b11240","block_type":"box","text":"We may vote against the election of directors who do not seem to have sufficient capacity to effectively fulfill","page_number":200,"box":{"x":101,"y":592,"width":776,"height":11}},{"id":"b693a97f-0de1-4a0c-adc2-7efb5917a1be","block_type":"box","text":"their duties to the board and company.","page_number":200,"box":{"x":68,"y":607,"width":275,"height":11}},{"id":"62d53f39-3262-4660-97b8-be78378beb4b","block_type":"box","text":"Director elections","page_number":200,"box":{"x":70,"y":629,"width":124,"height":9}},{"id":"30ef93ff-6f40-4503-9cbe-49da69db152f","block_type":"box","text":"Regular election of directors, ideally annually, suppor ts director accountability to shareholders. A classified board","page_number":200,"box":{"x":102,"y":647,"width":805,"height":12}},{"id":"fed1bd62-1168-41f3-b0ed-4d7092fc4338","block_type":"box","text":"structure","page_number":200,"box":{"x":69,"y":663,"width":63,"height":8}},{"id":"73a364a4-177e-4a6d-9dc5-55b34ce61d11","block_type":"box","text":"8","page_number":200,"box":{"x":133,"y":663,"width":4,"height":4}},{"id":"3076ba23-2f36-4388-b881-20335ec1c7e0","block_type":"box","text":"may be justified by a company when it needs consistency and stability during a time of transition, or on the","page_number":200,"box":{"x":144,"y":662,"width":761,"height":12}},{"id":"3afac373-8701-47a8-8706-212be1c73f85","block_type":"box","text":"basis of its business model (","page_number":200,"box":{"x":69,"y":677,"width":206,"height":11}},{"id":"8dc42028-0157-4b9c-b3a4-d0cd33198099","block_type":"box","text":"e.g.","page_number":200,"box":{"x":277,"y":679,"width":24,"height":10}},{"id":"7b42fa71-70ea-428f-abee-d522f95fc782","block_type":"box","text":", a non-operating company such as closed-end funds).","page_number":200,"box":{"x":304,"y":677,"width":382,"height":12}},{"id":"f78683cb-7063-4a23-b33d-d2f5d1e406be","block_type":"box","text":"Shareholders should have the oppor tunity to evaluate nominated directors individually rather than in bundled","page_number":200,"box":{"x":102,"y":696,"width":774,"height":11}},{"id":"5b780c0c-a63e-4d50-b630-9803faf9a293","block_type":"box","text":"slates. We look to companies to provide sufficient information on each director standing for election so that","page_number":200,"box":{"x":69,"y":711,"width":770,"height":11}},{"id":"86f7e06d-f75f-4bfa-a30c-5f0817fb7e31","block_type":"box","text":"shareholders can assess their capabilities and suitability. We will generally not suppor t the election of directors","page_number":200,"box":{"x":69,"y":726,"width":794,"height":11}},{"id":"721c7c82-37d5-483e-9312-9705ad656040","block_type":"box","text":"whose names and biographical details have not been disclosed sufficiently in advance of the shareholder meeting.","page_number":200,"box":{"x":68,"y":740,"width":818,"height":12}},{"id":"6cc23228-7de2-4204-beea-600ea4387eb1","block_type":"box","text":"Each director’s appointment should be dependent on receiving a simple majority of the votes cast at the","page_number":200,"box":{"x":102,"y":759,"width":743,"height":11}},{"id":"2e2cb5ed-96f8-4219-ba9f-b8c52d5ceaa1","block_type":"box","text":"shareholder meeting. Where a company’s practices differ, we look to the board to provide a detailed explanation as","page_number":200,"box":{"x":69,"y":774,"width":823,"height":11}},{"id":"369cd3fa-b1be-4e2b-bfd4-c04d2a4e55d6","block_type":"box","text":"to how its approach best serves investors’ interests.","page_number":200,"box":{"x":68,"y":789,"width":377,"height":11}},{"id":"a8745f70-215c-40d3-8aab-21b984e032e3","block_type":"box","text":"We may vote for shareholder or management proposals seeking to establish annual election of directors and/or","page_number":200,"box":{"x":101,"y":807,"width":798,"height":12}},{"id":"512a00dd-c2f9-4156-b14e-0335b38d22c0","block_type":"box","text":"a simple majority vote standard for director elections. We may vote against all the directors standing for election as","page_number":200,"box":{"x":69,"y":822,"width":822,"height":12}},{"id":"7283b61a-e80b-457a-b5f6-fba45df09404","block_type":"box","text":"par t of a single slate if we have concerns about the profile or per formance of an individual director.","page_number":200,"box":{"x":70,"y":837,"width":706,"height":12}},{"id":"f6faf607-d151-4cb4-929c-13b6e074024f","block_type":"box","text":"8","page_number":200,"box":{"x":69,"y":867,"width":4,"height":4}},{"id":"bd2be5c0-ee08-4287-90b6-b183747bf69b","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":200,"box":{"x":78,"y":866,"width":818,"height":12}},{"id":"d8ca33fd-e0a4-4bb1-8804-e039069c675b","block_type":"box","text":"directors stands for election in any one year.","page_number":200,"box":{"x":69,"y":882,"width":315,"height":11}},{"id":"df2bd10f-8064-4d34-9ee9-2f1e80d74424","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":200,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"fc646b5f-4562-4f07-b207-7e8a582f2433","block_type":"box","text":"Global Engagement and Voting Guidelines | 5","page_number":200,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"a802e02b-c3f2-406f-bf75-e279231a58dd","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":200,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"d6092739-dc04-40fb-b0b5-ab6386a169ec","block_type":"box","text":"Committees","page_number":201,"box":{"x":70,"y":45,"width":84,"height":9}},{"id":"b01fe193-63c4-40e0-9a69-2a7c2c359422","block_type":"box","text":"Many boards establish committees to focus on specific responsibilities of the board such as audit and risk,","page_number":201,"box":{"x":102,"y":63,"width":766,"height":11}},{"id":"05e7217b-4f1d-4963-ac76-5206dbeff5f7","block_type":"box","text":"governance and human capital, and executive compensation, amongst other matters. We do not prescribe to","page_number":201,"box":{"x":68,"y":78,"width":776,"height":11}},{"id":"cf31a47f-bfab-4e7d-9a5e-02409063c317","block_type":"box","text":"companies what committees they should establish, but we seek to understand the board’s rationale for the","page_number":201,"box":{"x":69,"y":93,"width":766,"height":11}},{"id":"c5f612c5-d172-4f8f-a674-ab8807bcff4e","block_type":"box","text":"committee structure it determines is appropriate. We note that, in some markets, regulation requires such","page_number":201,"box":{"x":69,"y":108,"width":759,"height":11}},{"id":"a022797c-ddf2-4a50-bf47-e1c481dcc793","block_type":"box","text":"committees. The responsibilities of each committee should be clear, and the board should ensure that all critical","page_number":201,"box":{"x":69,"y":123,"width":804,"height":11}},{"id":"6b31cd63-9fee-4081-bb06-36800d09e45a","block_type":"box","text":"matters are assigned either to the full board or to one of the committees. It is helpful to investor understanding when","page_number":201,"box":{"x":69,"y":138,"width":837,"height":11}},{"id":"9fdfb892-18b0-4c57-8a03-0a4c6d6c2b5e","block_type":"box","text":"the board discloses the structure, membership, propor tion of independent directors, and responsibilities of each","page_number":201,"box":{"x":68,"y":152,"width":806,"height":11}},{"id":"6be6cbf0-5d6c-4b23-9756-058e340696f0","block_type":"box","text":"committee. The responsibilities we typically see assigned to the three most common committees include:","page_number":201,"box":{"x":69,"y":168,"width":752,"height":11}},{"id":"d0104f48-995c-4ec2-aa1b-bf783258ab67","block_type":"box","text":"•","page_number":201,"box":{"x":69,"y":188,"width":6,"height":4}},{"id":"c735014e-af90-479e-9f74-94fe3e67c071","block_type":"box","text":"Audit and risk – oversight responsibilities for the integrity of financial repor ting, risk management and","page_number":201,"box":{"x":101,"y":185,"width":722,"height":11}},{"id":"9e4967c9-85fd-445d-ba30-bbf3a7ee8753","block_type":"box","text":"compliance with legal and regulatory requirements; may also play an oversight role in relation to the internal","page_number":201,"box":{"x":101,"y":200,"width":771,"height":11}},{"id":"6327d668-a968-4497-968d-4b5f686fa147","block_type":"box","text":"audit function and whistleblowing mechanisms.","page_number":201,"box":{"x":102,"y":214,"width":335,"height":12}},{"id":"227d6342-3f9c-48aa-8807-9a5fabfe88cc","block_type":"box","text":"•","page_number":201,"box":{"x":69,"y":235,"width":6,"height":4}},{"id":"2ddef187-3f5d-440e-b010-b4dfbf52bfe6","block_type":"box","text":"Nominating, governance and human capital – oversight responsibilities for corporate governance principles and","page_number":201,"box":{"x":102,"y":232,"width":790,"height":11}},{"id":"bc4e5cb9-c8f8-4a85-b3b8-86078770ed26","block_type":"box","text":"practices of the company, including the periodic review of board per formance; responsibility for succession","page_number":201,"box":{"x":102,"y":247,"width":761,"height":11}},{"id":"d0cc6901-25cc-45ef-8c06-db72bf62e903","block_type":"box","text":"planning for CEO and key board roles, as well as the director appointment process; may also have oversight","page_number":201,"box":{"x":102,"y":262,"width":769,"height":11}},{"id":"78667ff5-ee2b-4830-8ed2-c33f78b0fa6f","block_type":"box","text":"responsibilities for human capital management strategies, including corporate culture and purpose.","page_number":201,"box":{"x":102,"y":276,"width":707,"height":12}},{"id":"bb263f4f-e541-42b7-923f-44fe1608a515","block_type":"box","text":"•","page_number":201,"box":{"x":69,"y":297,"width":6,"height":4}},{"id":"0f97fe70-9e48-4cb4-8a54-d9c066576a31","block_type":"box","text":"Executive compensation – determines the compensation policies and programs for the CEO and other executive","page_number":201,"box":{"x":102,"y":294,"width":796,"height":11}},{"id":"897cbf76-2448-4679-8e8c-f40905d7f7ed","block_type":"box","text":"officers, approves annual awards and payments under the policies; may also have oversight responsibilities for","page_number":201,"box":{"x":102,"y":309,"width":793,"height":11}},{"id":"4b36e6ce-7962-4a8e-82c2-c4637f26fd29","block_type":"box","text":"firm-wide compensation policies.","page_number":201,"box":{"x":101,"y":323,"width":232,"height":11}},{"id":"fbe0a0d4-74c5-4f08-9cd3-4d0036c9da3a","block_type":"box","text":"We may vote against the election of the chair of the committee or other directors serving as committee members","page_number":201,"box":{"x":101,"y":342,"width":807,"height":11}},{"id":"be913e56-6225-4f4e-863b-a444a1c02cff","block_type":"box","text":"to convey concerns about how a committee has under taken its responsibilities. We may vote against the election of","page_number":201,"box":{"x":68,"y":357,"width":828,"height":11}},{"id":"0df35ba5-bf2f-459d-9192-a3df874b35e6","block_type":"box","text":"the most senior non-executive director if there is not a clearly disclosed approach to board committees.","page_number":201,"box":{"x":68,"y":372,"width":738,"height":11}},{"id":"389cb552-35ba-4f70-a88f-290a6c6b0b62","block_type":"box","text":"Board and director evaluation","page_number":201,"box":{"x":70,"y":395,"width":209,"height":8}},{"id":"6fd0bd25-36db-46b3-9bb8-a791e0299437","block_type":"box","text":"We consider it best practice for companies to conduct an annual review of the per formance of the board, the","page_number":201,"box":{"x":101,"y":413,"width":776,"height":11}},{"id":"4f4d5c68-8873-43cb-a2d8-a61f431fdc5e","block_type":"box","text":"committees, the chair and individual directors. Periodically, this review could be under taken by an independent third","page_number":201,"box":{"x":69,"y":428,"width":825,"height":11}},{"id":"b137eaee-c803-42a4-9e11-35b97ea399f8","block_type":"box","text":"par ty able to bring objective perspectives to the board on governance and per formance. We encourage companies to","page_number":201,"box":{"x":70,"y":443,"width":831,"height":11}},{"id":"06a4b69e-4b6e-4b03-8c0e-3cb77b8c30dd","block_type":"box","text":"disclose their approach to and the objectives of evaluations, including any changes made to the board’s approach as","page_number":201,"box":{"x":69,"y":458,"width":835,"height":11}},{"id":"df2c1cb6-d5b2-4b76-bcb1-7445791facb8","block_type":"box","text":"a result.","page_number":201,"box":{"x":69,"y":473,"width":57,"height":8}},{"id":"b9c98740-e7e7-4835-a04c-922bda536cd2","block_type":"box","text":"Access to independent advice","page_number":201,"box":{"x":68,"y":495,"width":214,"height":11}},{"id":"163a736d-d2c0-4610-80a1-6860b055b2b8","block_type":"box","text":"To suppor t the directors in effectively fulfilling their duties to the company and shareholders, they should have","page_number":201,"box":{"x":101,"y":513,"width":786,"height":12}},{"id":"5dfc91ce-41ee-4ee1-941a-f4d2c2059b4a","block_type":"box","text":"access to independent advice. In cer tain circumstances, it may be helpful to boards to retain independent third","page_number":201,"box":{"x":69,"y":528,"width":793,"height":11}},{"id":"08a1099b-6c87-422e-af31-b024803ea519","block_type":"box","text":"par ties to advise on critical matters. These might include new industry developments such as emergent and","page_number":201,"box":{"x":70,"y":543,"width":770,"height":11}},{"id":"a81ec250-0892-44ae-9155-ca71f7e2b2ed","block_type":"box","text":"disruptive technology, operating events with material consequences for the company’s reputation and/or","page_number":201,"box":{"x":69,"y":558,"width":746,"height":11}},{"id":"746529cd-2826-4940-9ebd-44d2ddaaed0a","block_type":"box","text":"per formance, or significant transactions. Board committees may similarly retain third par ties to advise them on","page_number":201,"box":{"x":70,"y":573,"width":793,"height":11}},{"id":"cb267483-525d-42b3-834f-17cfc11dda5c","block_type":"box","text":"specialist matters such as audit, compensation and succession planning.","page_number":201,"box":{"x":69,"y":588,"width":524,"height":11}},{"id":"b33006fa-c0e5-4214-abde-7304a89271e6","block_type":"box","text":"EXECUTIVE COMPENSATION","page_number":201,"box":{"x":385,"y":618,"width":207,"height":9}},{"id":"3d8d4634-575a-4ea0-bd7b-cedcdfa01290","block_type":"box","text":"Boards play an impor tant role in establishing compensation arrangements that enable the company to recruit,","page_number":201,"box":{"x":102,"y":637,"width":784,"height":11}},{"id":"81ef8de2-7782-4330-a3d2-95290994e863","block_type":"box","text":"retain and reward the caliber of executive management necessary to lead and operate the company to deliver","page_number":201,"box":{"x":69,"y":652,"width":782,"height":11}},{"id":"4e662354-0d6a-47f3-83d2-29fae3e2eac4","block_type":"box","text":"superior financial returns over time. We focus on alignment between variable pay and a company’s financial","page_number":201,"box":{"x":69,"y":666,"width":766,"height":12}},{"id":"d84e6625-7d7e-462e-8e6a-b0acc03a23ca","block_type":"box","text":"per formance.","page_number":201,"box":{"x":70,"y":681,"width":93,"height":11}},{"id":"784274d3-5c5e-45d5-808f-8babd7a7bd61","block_type":"box","text":"Generally, executive compensation arrangements have four components: base salary, annual bonus that rewards","page_number":201,"box":{"x":102,"y":700,"width":805,"height":11}},{"id":"34ce8165-d9af-4e0e-8f5c-25e0e6853709","block_type":"box","text":"per formance against shor t-term metrics, incentives – most often share-based that reward per formance against long","page_number":201,"box":{"x":70,"y":715,"width":831,"height":11}},{"id":"bf7843d6-5f5a-432e-a3a7-e3940f6ba290","block_type":"box","text":"term metrics, and pensions and benefits. In our observation, base salary, pensions and benefits are largely set","page_number":201,"box":{"x":68,"y":730,"width":798,"height":11}},{"id":"06c5fcaa-44ad-48f4-8a5b-d5b691094496","block_type":"box","text":"relative to market norms and benchmarks. The annual bonus and share-based incentive, or variable pay plans, tend","page_number":201,"box":{"x":69,"y":745,"width":824,"height":11}},{"id":"ef247ab4-fd61-4607-b116-bdb6cbd4b9d1","block_type":"box","text":"to be tailored to the company, its sector and long-term strategy, as well as the individuals the board is seeking to","page_number":201,"box":{"x":68,"y":760,"width":807,"height":11}},{"id":"b213764b-b4bb-4f9f-80f1-d58957cb7208","block_type":"box","text":"recruit and motivate.","page_number":201,"box":{"x":69,"y":774,"width":146,"height":9}},{"id":"f363f008-4842-405a-beb4-958398765425","block_type":"box","text":"Recognizing the unique circumstances of each company, we determine whether to suppor t a company’s","page_number":201,"box":{"x":102,"y":793,"width":739,"height":11}},{"id":"ac3cb31a-6ca0-4505-81e6-211aa003e633","block_type":"box","text":"approach to executive compensation on a case-by-case basis. We rely on companies providing sufficient quantitative","page_number":201,"box":{"x":69,"y":808,"width":831,"height":11}},{"id":"2f57d89d-323a-4ed7-894b-182d61543701","block_type":"box","text":"and qualitative information in their disclosures to enable shareholders to understand the compensation","page_number":201,"box":{"x":69,"y":823,"width":737,"height":11}},{"id":"f2441191-7861-473d-b47d-fafe82258cfe","block_type":"box","text":"arrangements and assess the alignment with investors’ interests. Features we look for in compensation","page_number":201,"box":{"x":69,"y":837,"width":741,"height":12}},{"id":"5a79f8af-733c-428a-b3d1-5158c4524b29","block_type":"box","text":"arrangements include:","page_number":201,"box":{"x":69,"y":853,"width":157,"height":11}},{"id":"1ff7a987-f6c7-4ec4-abd1-f13153e0d44d","block_type":"box","text":"•","page_number":201,"box":{"x":69,"y":873,"width":6,"height":4}},{"id":"5c765953-767d-42c2-beae-65a89c76a2de","block_type":"box","text":"Fixed pay components, including base salary, benefits and prerequisites that are appropriate in the context of","page_number":201,"box":{"x":102,"y":870,"width":783,"height":11}},{"id":"ef6beb98-96ba-4890-bc40-357087bec051","block_type":"box","text":"the company’s size, sector and market.","page_number":201,"box":{"x":101,"y":885,"width":280,"height":11}},{"id":"fe1110ab-7c01-4290-a72d-8f421cb759c0","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":201,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"6d31cfb9-44d4-41e1-beeb-952b0e65b953","block_type":"box","text":"Global Engagement and Voting Guidelines | 6","page_number":201,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"5b1b88b8-4a3b-4aff-bc20-773a5308bf3f","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":201,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"2331f0c2-32e5-4e87-bdcb-9580a778e6e9","block_type":"box","text":"•","page_number":202,"box":{"x":69,"y":48,"width":6,"height":4}},{"id":"3b2f6c2d-5823-4008-b7bd-70972dbc8762","block_type":"box","text":"Variable pay subject to per formance metrics that are closely linked to the company’s shor t- and long-term","page_number":202,"box":{"x":101,"y":45,"width":752,"height":11}},{"id":"8d446156-b4a7-4da5-a5fb-f2a9d85675e7","block_type":"box","text":"strategic objectives.","page_number":202,"box":{"x":102,"y":60,"width":140,"height":11}},{"id":"18e8fded-56bd-43f9-a3af-b85cca9c9363","block_type":"box","text":"•","page_number":202,"box":{"x":69,"y":80,"width":6,"height":4}},{"id":"9ea6815e-72f5-4c3f-90da-2e23cbddf640","block_type":"box","text":"Long-term incentives that motivate sustained per formance across a multi-year period.","page_number":202,"box":{"x":102,"y":77,"width":609,"height":11}},{"id":"cf0131ff-2c21-48fc-a381-e5098fa08185","block_type":"box","text":"•","page_number":202,"box":{"x":69,"y":97,"width":6,"height":5}},{"id":"17e961bc-4dc4-4728-827a-46d5d75418a1","block_type":"box","text":"A balance between fixed and variable pay, shor t- and long-term incentives, and specific instruments (cash and","page_number":202,"box":{"x":101,"y":94,"width":784,"height":12}},{"id":"0887676c-6684-4a5c-8fd7-3c2f762b0801","block_type":"box","text":"equity awards) that promotes pay program durability and seldom necessitates one-off, discretionary payments.","page_number":202,"box":{"x":101,"y":109,"width":790,"height":11}},{"id":"4693c62a-182d-4186-b351-8b478f8036cf","block_type":"box","text":"•","page_number":202,"box":{"x":69,"y":129,"width":6,"height":5}},{"id":"727f6804-21bc-4f49-85af-ac0566188cf7","block_type":"box","text":"Pay outcomes that are consistent with the returns to investors over the relevant time period.","page_number":202,"box":{"x":102,"y":127,"width":658,"height":11}},{"id":"ce1cac7a-04fa-49f9-9865-94564b2491a3","block_type":"box","text":"•","page_number":202,"box":{"x":69,"y":147,"width":6,"height":4}},{"id":"b4ed9e46-36eb-494e-80a9-154596c5d2bb","block_type":"box","text":"Board discretion, if allowed within the variable pay arrangements, to be used sparingly, responsibly and","page_number":202,"box":{"x":102,"y":144,"width":735,"height":11}},{"id":"cd9317a9-c13d-4cae-aa34-bf42c0291cd0","block_type":"box","text":"transparently.","page_number":202,"box":{"x":101,"y":159,"width":95,"height":11}},{"id":"322ec8ad-35c1-4044-9770-5fcd2d8c574a","block_type":"box","text":"•","page_number":202,"box":{"x":69,"y":179,"width":6,"height":5}},{"id":"7b4555fd-30cb-409f-9885-9f3b95b0c50d","block_type":"box","text":"A requirement, that par ticipants in long-term share-based incentive plans build a meaningful shareholding in the","page_number":202,"box":{"x":101,"y":176,"width":798,"height":11}},{"id":"df536665-2dcf-4453-a294-dbe1fa11f15a","block_type":"box","text":"company within a defined time period, as determined by the board or relevant board committee.","page_number":202,"box":{"x":101,"y":191,"width":683,"height":11}},{"id":"16ef1566-01aa-4476-aef5-29029bffc697","block_type":"box","text":"•","page_number":202,"box":{"x":69,"y":211,"width":6,"height":5}},{"id":"9378f693-25b9-4776-b175-42b4533e033d","block_type":"box","text":"Change of control provisions that appropriately balance the interests of executives and shareholders.","page_number":202,"box":{"x":102,"y":208,"width":720,"height":12}},{"id":"459d08f8-2990-44f8-919d-eb69bd1ee030","block_type":"box","text":"•","page_number":202,"box":{"x":69,"y":229,"width":6,"height":4}},{"id":"f86fdf53-505b-430f-b17d-86c23d77197e","block_type":"box","text":"Clawback or malus provisions that allow the company to recoup or hold back variable compensation from","page_number":202,"box":{"x":102,"y":226,"width":747,"height":11}},{"id":"6a4cff94-954e-49ea-b7bb-731e66be72c3","block_type":"box","text":"individuals whose awards were based on fraudulent activities, misstated financial repor ts, or executive","page_number":202,"box":{"x":102,"y":241,"width":733,"height":11}},{"id":"35e0f99f-9620-405e-892b-8ff73c2a6222","block_type":"box","text":"misconduct.","page_number":202,"box":{"x":102,"y":256,"width":84,"height":8}},{"id":"9a8f3088-7667-47e8-a044-1a55a9e0b98f","block_type":"box","text":"•","page_number":202,"box":{"x":69,"y":276,"width":6,"height":4}},{"id":"df91d7ae-ce2b-4e1b-9021-b2a8b76a57b2","block_type":"box","text":"Severance arrangements that protect the company’s interests but do not cost more than is contractual.","page_number":202,"box":{"x":102,"y":273,"width":738,"height":11}},{"id":"0cb6d645-fb66-41ad-b0fa-b6ae676f46f0","block_type":"box","text":"We may vote against proposals to introduce new share-based incentives, approve existing policies or plans, or","page_number":202,"box":{"x":101,"y":292,"width":787,"height":11}},{"id":"a2790490-9d1b-4ce5-b7bb-fce0b4c02966","block_type":"box","text":"approve the compensation repor t where we do not see alignment between executive compensation arrangements","page_number":202,"box":{"x":69,"y":307,"width":810,"height":11}},{"id":"b8925523-5c29-4520-b6c3-8bee951269a3","block_type":"box","text":"and our clients’ financial interests. When there is not an alternative, or where there have been multi-year issues with","page_number":202,"box":{"x":69,"y":321,"width":831,"height":11}},{"id":"230c7baa-a344-4b31-8623-cf19fd5c245b","block_type":"box","text":"compensation misaligned with per formance, we may vote against the election of the chair of the responsible","page_number":202,"box":{"x":69,"y":336,"width":775,"height":11}},{"id":"8492cee4-f2d0-404d-ac1a-221382ce0f63","block_type":"box","text":"committee, or the most senior independent director.","page_number":202,"box":{"x":69,"y":351,"width":371,"height":11}},{"id":"9e4674f5-9111-4adb-b6ad-6c2fab127b8f","block_type":"box","text":"NON-EXECUTIVE DIRECTOR COMPENSATION","page_number":202,"box":{"x":326,"y":381,"width":325,"height":9}},{"id":"1a80e34e-7bb4-401e-9ea7-04d7bf094f77","block_type":"box","text":"Companies generally pay non-executive directors an annual retainer or fee in cash, shares or a combination of","page_number":202,"box":{"x":102,"y":400,"width":785,"height":11}},{"id":"66e99907-7e43-4d41-99b6-89f4db0ada90","block_type":"box","text":"the two. Some companies also pay additional fees for service on board committees or in board leadership roles. We","page_number":202,"box":{"x":68,"y":415,"width":831,"height":11}},{"id":"8116eb5b-8dab-4675-b46c-54e872cf6370","block_type":"box","text":"do not suppor t non-executive directors par ticipating in per formance-based incentive plans as doing so may create a","page_number":202,"box":{"x":69,"y":430,"width":825,"height":11}},{"id":"dc5c13cb-b4d8-43c5-bb5b-a1d116ff83a8","block_type":"box","text":"conflict of interest and undermine their independence from management, whom they oversee.","page_number":202,"box":{"x":69,"y":444,"width":668,"height":12}},{"id":"e874a196-95cb-42ac-a2e3-369e564231bd","block_type":"box","text":"CAPITAL STRUCTURE","page_number":202,"box":{"x":411,"y":475,"width":156,"height":8}},{"id":"e07ec352-b034-4dcd-beb9-966b6dccf4a0","block_type":"box","text":"Boards are responsible for ensuring senior executive leadership has established a capital strategy that achieves","page_number":202,"box":{"x":102,"y":493,"width":800,"height":12}},{"id":"aa2495b4-0251-4ca5-a4b5-1e5041bf43a2","block_type":"box","text":"appropriate capital allocation in suppor t of long-term financial resilience.","page_number":202,"box":{"x":69,"y":508,"width":516,"height":11}},{"id":"f1018087-fe6b-48f6-a471-479037757151","block_type":"box","text":"Where company practices diverge from those set out below, we look for companies to disclose why they view","page_number":202,"box":{"x":101,"y":527,"width":776,"height":11}},{"id":"6ae853a9-f797-4ad5-b1e1-7d532df6882c","block_type":"box","text":"these practices to be aligned with shareholders’ interests. We may vote against management proposals seeking","page_number":202,"box":{"x":68,"y":542,"width":803,"height":11}},{"id":"616f5275-d0d9-4a22-a9ec-ef2f5a885d3f","block_type":"box","text":"capital-related authorities, or the election of the most senior independent director, if we have concerns about a","page_number":202,"box":{"x":69,"y":557,"width":790,"height":11}},{"id":"367ccf94-e51a-4dfb-a104-16761aedc09c","block_type":"box","text":"company’s approach. We may also suppor t a shareholder proposal seeking conversion of shares with differentiated","page_number":202,"box":{"x":69,"y":571,"width":825,"height":12}},{"id":"4bcb273d-7c8a-4197-ab14-a4aeeb85b66b","block_type":"box","text":"voting rights to a one-share, one-vote standard.","page_number":202,"box":{"x":68,"y":587,"width":336,"height":11}},{"id":"9ed747b7-ec82-4992-8d44-c753f5d3b549","block_type":"box","text":"Share issuance","page_number":202,"box":{"x":68,"y":609,"width":111,"height":9}},{"id":"90da7406-d074-4f25-8b4e-a14de28bc547","block_type":"box","text":"We assess requests for share issuance for par ticular transactions on a case-by-case basis. We will generally","page_number":202,"box":{"x":101,"y":627,"width":776,"height":12}},{"id":"526c5ff6-0925-4b41-91b9-fb4ec2334bc6","block_type":"box","text":"suppor t authorities to issue shares when subject to pre-emptive rights, and up to 20% absent pre-emptive rights. We","page_number":202,"box":{"x":69,"y":642,"width":832,"height":12}},{"id":"7ee96c0d-f832-42f1-afa6-bef7c2fba920","block_type":"box","text":"consider it good practice for companies to seek regular approval of these authorities to allow shareholders to take","page_number":202,"box":{"x":69,"y":657,"width":815,"height":11}},{"id":"c1e0f756-e43c-492e-9f25-af0bf2955f35","block_type":"box","text":"into consideration how prior authorities were used, as well as the current circumstances of the company and the","page_number":202,"box":{"x":70,"y":672,"width":802,"height":11}},{"id":"bbd1d9b7-a5c6-410e-b41b-6d71923375dd","block_type":"box","text":"market environment.","page_number":202,"box":{"x":69,"y":687,"width":145,"height":9}},{"id":"d25ff841-82a1-4d1e-b5e9-358221c7c825","block_type":"box","text":"Share buybacks","page_number":202,"box":{"x":68,"y":709,"width":116,"height":11}},{"id":"808883fe-4f68-40e2-b001-c7d12152c79c","block_type":"box","text":"We assess share buyback proposals in the context of the company’s disclosed capital management strategy and","page_number":202,"box":{"x":101,"y":728,"width":806,"height":11}},{"id":"e8555d4e-c8c2-4d36-a12d-7f954e34d1f9","block_type":"box","text":"management’s determination of the appropriate balance between investment that suppor ts the long-term growth of","page_number":202,"box":{"x":69,"y":743,"width":823,"height":11}},{"id":"82565755-4da9-4a8b-a107-3d080e2e5f02","block_type":"box","text":"the company and returning cash to investors. We also take into consideration the effect of a buyback program on the","page_number":202,"box":{"x":68,"y":758,"width":836,"height":11}},{"id":"f2a2f2ec-1ac6-4a4a-b1e9-e9529e77e37a","block_type":"box","text":"company’s balance sheet and executive compensation arrangements and the price at which shares are repurchased","page_number":202,"box":{"x":69,"y":773,"width":830,"height":11}},{"id":"d31eb0f3-7dc0-4dbf-8b7f-985b73585057","block_type":"box","text":"relative to market price. We consider it good practice for companies to seek regular approval of these authorities to","page_number":202,"box":{"x":69,"y":787,"width":822,"height":12}},{"id":"613cda14-1347-44b1-8a66-1e0a33722796","block_type":"box","text":"allow shareholders to take into consideration how prior authorities were used, as well as the current circumstances","page_number":202,"box":{"x":69,"y":802,"width":823,"height":11}},{"id":"e0a1eb1f-1ee0-427d-8b04-df4d460882dd","block_type":"box","text":"of the company and the market environment.","page_number":202,"box":{"x":69,"y":817,"width":319,"height":11}},{"id":"122bec8f-d8ea-4c0a-bc8f-6d93498ca175","block_type":"box","text":"Dividends","page_number":202,"box":{"x":69,"y":840,"width":69,"height":8}},{"id":"9cf5c0ad-8366-4463-a5bf-578bec77f867","block_type":"box","text":"We generally defer to management and the board on dividend policy but may engage to seek fur ther clarification","page_number":202,"box":{"x":101,"y":858,"width":799,"height":11}},{"id":"13f7aa12-7857-41da-8fb7-4f2110817f69","block_type":"box","text":"where a proposed dividend appears out of line with the company’s financial position.","page_number":202,"box":{"x":68,"y":873,"width":604,"height":11}},{"id":"1f14aea0-ef14-484e-80ba-b098acac08b2","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":202,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"04efa049-f099-4e38-bae4-8c54d11b0aea","block_type":"box","text":"Global Engagement and Voting Guidelines | 7","page_number":202,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"30a2d412-58d2-40b0-b8d5-2b22d312988b","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":202,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"59602c6e-0c20-43cb-bf89-b92af69bca10","block_type":"box","text":"Differentiated voting rights","page_number":203,"box":{"x":69,"y":45,"width":196,"height":11}},{"id":"29a0d914-1849-49ab-bd32-691984b09352","block_type":"box","text":"We prefer companies to adopt a one-share, one-vote structure for share classes with the same economic","page_number":203,"box":{"x":101,"y":63,"width":750,"height":11}},{"id":"a3b1d552-a130-49af-96a8-f20bd4cc572e","block_type":"box","text":"exposure. Cer tain companies, par ticularly those new to public markets, could make the case to adopt a","page_number":203,"box":{"x":69,"y":78,"width":740,"height":11}},{"id":"7d2710cf-2a9b-48c9-ab3e-6dca064021b0","block_type":"box","text":"differentiated voting rights structure, or dual class stock. In those situations, we encourage companies to evaluate","page_number":203,"box":{"x":69,"y":93,"width":819,"height":11}},{"id":"e5160107-879f-4342-8559-e5613475020d","block_type":"box","text":"and seek approval for their capital structure on a periodic basis.","page_number":203,"box":{"x":69,"y":108,"width":456,"height":11}},{"id":"6a5aac10-4f12-4b3e-ba29-ef3134efd4cf","block_type":"box","text":"TRANSACTIONS AND SPECIAL SITUATIONS","page_number":203,"box":{"x":332,"y":138,"width":314,"height":9}},{"id":"3421f5d8-1425-4b39-9f7a-66de9a544bab","block_type":"box","text":"We monitor developments in transactions and special situations closely and under take our own detailed","page_number":203,"box":{"x":101,"y":157,"width":743,"height":11}},{"id":"0ae24e8e-8553-49c1-9fe0-7332b0c737f2","block_type":"box","text":"analyses of proposals.","page_number":203,"box":{"x":69,"y":172,"width":159,"height":11}},{"id":"d6740e63-8665-4c1c-a9c1-6fef132ebe5d","block_type":"box","text":"Mergers and acquisitions","page_number":203,"box":{"x":69,"y":194,"width":184,"height":11}},{"id":"eafa7607-3a92-4176-9633-68d4368ecef0","block_type":"box","text":"We evaluate proposed mergers or acquisitions by assessing the financial outcome for our clients as minority","page_number":203,"box":{"x":101,"y":213,"width":775,"height":11}},{"id":"f10030d9-22d6-44cb-ac2b-a3705b3a94a0","block_type":"box","text":"shareholders. Management should provide an assessment of the proposed transaction’s strategic and financial","page_number":203,"box":{"x":69,"y":228,"width":797,"height":11}},{"id":"84f919ed-e33c-49a0-a35b-3602d8c61c0f","block_type":"box","text":"rationale, along with its execution and operational risks. We review each transaction independently based on these","page_number":203,"box":{"x":69,"y":243,"width":819,"height":11}},{"id":"68015d46-2089-4f7b-9961-74d0df8d249e","block_type":"box","text":"factors and the degree to which the transaction enhances shareholder value. The board might consider establishing","page_number":203,"box":{"x":68,"y":257,"width":827,"height":12}},{"id":"af97b5c8-712f-499a-a03f-1a6ba54701be","block_type":"box","text":"an ad hoc transaction committee to under take an independent assessment of a significant merger or acquisition, in","page_number":203,"box":{"x":69,"y":272,"width":827,"height":11}},{"id":"95f381f2-32bd-465f-8246-732434441eff","block_type":"box","text":"advance of making its recommendation to shareholders.","page_number":203,"box":{"x":69,"y":287,"width":400,"height":11}},{"id":"c20a10e1-f93d-49f8-8599-682a11fc29df","block_type":"box","text":"We will vote against transactions that, in our assessment, do not advance our clients’ financial interests.","page_number":203,"box":{"x":101,"y":306,"width":749,"height":11}},{"id":"3e4918b8-3810-4549-b4db-a7689ece667b","block_type":"box","text":"Anti-takeover defenses","page_number":203,"box":{"x":68,"y":328,"width":167,"height":9}},{"id":"21afaef0-6403-4cf5-a913-36e6c97cac57","block_type":"box","text":"In principle, we do not suppor t companies using anti-takeover defenses, also known as poison pills or","page_number":203,"box":{"x":102,"y":347,"width":727,"height":11}},{"id":"432a23d5-b7d0-4bc9-8d18-7dc3cb460bc0","block_type":"box","text":"shareholder rights plans, as they can entrench management and boards which have not delivered long-term","page_number":203,"box":{"x":69,"y":362,"width":766,"height":11}},{"id":"36d57c24-a03a-4d1f-af31-193125192762","block_type":"box","text":"shareholder value. By exception, a poison pill may be suppor ted if its purpose is to delay a takeover that is","page_number":203,"box":{"x":69,"y":376,"width":763,"height":12}},{"id":"3b66069e-78ec-4782-aa61-15071969f94a","block_type":"box","text":"considered sub-optimal and enable management to seek an improved offer. Similarly, management could make the","page_number":203,"box":{"x":69,"y":391,"width":821,"height":12}},{"id":"76923578-3556-4c3b-8b70-eaa093c7521e","block_type":"box","text":"case to use a poison pill to block a shareholder activism campaign that may be counter to the interests of other","page_number":203,"box":{"x":69,"y":406,"width":799,"height":11}},{"id":"7cb89d99-acd3-489b-a22a-5314325f9d76","block_type":"box","text":"investors. Defense mechanisms introduced in these circumstances should be limited in term and threshold, and also","page_number":203,"box":{"x":70,"y":421,"width":836,"height":11}},{"id":"aef5217a-e0ed-48e8-b460-a27599ce895c","block_type":"box","text":"be closely monitored by the independent members of the board. We consider it good practice for companies to put to","page_number":203,"box":{"x":69,"y":436,"width":835,"height":11}},{"id":"3609e431-e4ce-49c2-846a-d47a6f683ae7","block_type":"box","text":"a shareholder vote any mechanisms expected to be in place for more than 12 months.","page_number":203,"box":{"x":69,"y":451,"width":616,"height":11}},{"id":"51e1b3d2-8331-4f03-9efd-cb88d8b721c9","block_type":"box","text":"Shareholder activism","page_number":203,"box":{"x":68,"y":473,"width":153,"height":9}},{"id":"f19caa7f-9a50-41c1-bbfb-7880fda5005d","block_type":"box","text":"When companies are the focus of an activism campaign, we may communicate with the activist to understand","page_number":203,"box":{"x":101,"y":492,"width":783,"height":11}},{"id":"df277d04-d3e9-4654-a9d9-c079a238bada","block_type":"box","text":"their analysis and objectives, once they have publicly disclosed their campaign. We may also engage with company","page_number":203,"box":{"x":68,"y":507,"width":819,"height":11}},{"id":"be84812f-5053-4e53-aca8-5576e9d912f6","block_type":"box","text":"management and possibly board members, especially those the activist may be seeking to replace. In our","page_number":203,"box":{"x":69,"y":522,"width":755,"height":11}},{"id":"18118e46-9bf9-4185-80ad-d56dd9615d91","block_type":"box","text":"assessment, we evaluate various factors, including the concerns raised by the activist and the case for change; the","page_number":203,"box":{"x":69,"y":536,"width":824,"height":12}},{"id":"1e4e8ea6-7b04-48ad-8760-5d8480c80091","block_type":"box","text":"quality of both the activist’s and management’s plans; and the qualifications of each par ty’s candidates. We evaluate","page_number":203,"box":{"x":69,"y":551,"width":839,"height":12}},{"id":"736575be-725f-4f25-a55f-13bb73a989a1","block_type":"box","text":"each contested situation by assessing the potential financial outcome for our clients as minority shareholders.","page_number":203,"box":{"x":69,"y":566,"width":788,"height":11}},{"id":"4e1bee28-a0ac-4fa3-9d12-258e49f66c40","block_type":"box","text":"We may suppor t board candidates nominated by a shareholder activist if BAIS, in its independent judgment, or","page_number":203,"box":{"x":101,"y":585,"width":789,"height":11}},{"id":"dbb03177-6840-438b-b1fc-c2559f731cef","block_type":"box","text":"the relevant por tfolio manager has determined that there is a case for change to enhance shareholder value, or if the","page_number":203,"box":{"x":68,"y":600,"width":839,"height":11}},{"id":"37ff46ee-aade-450d-8986-9628c5142397","block_type":"box","text":"incumbent board members do not demonstrate the relevant skills and exper tise or have a poor track record of","page_number":203,"box":{"x":70,"y":614,"width":786,"height":11}},{"id":"cde672eb-8283-4708-a8fb-dbf6169765f0","block_type":"box","text":"protecting shareholders’ interests.","page_number":203,"box":{"x":70,"y":630,"width":244,"height":11}},{"id":"3371cdb3-92e1-49b9-a0e9-1234b339dce5","block_type":"box","text":"Significant shareholders and related party transactions","page_number":203,"box":{"x":68,"y":652,"width":403,"height":11}},{"id":"e989dbae-a9e5-4892-8afc-9686442ab6f9","block_type":"box","text":"Boards of companies with affiliated shareholders or directors should give equitable consideration to the","page_number":203,"box":{"x":102,"y":670,"width":740,"height":12}},{"id":"1d4b59ea-3c11-4d33-b6e2-4989ba5131a0","block_type":"box","text":"interests of all shareholders when evaluating related par ty transactions.","page_number":203,"box":{"x":70,"y":685,"width":511,"height":12}},{"id":"2fdbd917-68d9-4dbe-833b-10be447d8c14","block_type":"box","text":"We consider it good practice for transactions with related par ties, such as significant shareholders or companies","page_number":203,"box":{"x":101,"y":704,"width":805,"height":11}},{"id":"c28fdfe7-a496-42b6-8af0-44c96b1572bb","block_type":"box","text":"affiliated with the public company, to be disclosed in detail and conducted on terms similar to what would objectively","page_number":203,"box":{"x":69,"y":719,"width":832,"height":11}},{"id":"4e4fdde1-ca14-4efd-8fd1-e092b8670a3a","block_type":"box","text":"have been agreed with a non-related par ty. In our view, such transactions should be reviewed and approved by the","page_number":203,"box":{"x":69,"y":734,"width":812,"height":11}},{"id":"b3063952-b63b-4f84-adfb-8200fe0a0b95","block_type":"box","text":"independent members of the board, and if voted on, only disinterested shareholders should vote.","page_number":203,"box":{"x":70,"y":748,"width":692,"height":12}},{"id":"0a125db2-6f3b-465c-b80b-86951dee17f1","block_type":"box","text":"CORPORATE REPORTING, RISK MANAGEMENT AND AUDIT","page_number":203,"box":{"x":274,"y":779,"width":430,"height":10}},{"id":"bed03100-b1b7-4790-8018-bae6d6c12393","block_type":"box","text":"Investors depend on corporate repor ting, both regulatory and voluntary, to understand a company’s strategy, its","page_number":203,"box":{"x":102,"y":798,"width":796,"height":11}},{"id":"5bebed4a-904f-4e5d-b338-b096b57ea7a5","block_type":"box","text":"implementation and financial per formance, as well as to assess the quality of management and operations and","page_number":203,"box":{"x":70,"y":812,"width":795,"height":12}},{"id":"a6f285cc-0665-4d39-b554-2e2783e272e1","block_type":"box","text":"potential for the company to create shareholder value over time. We consider it good practice for the board to","page_number":203,"box":{"x":70,"y":827,"width":779,"height":11}},{"id":"298e04b8-2fe3-4912-9062-c0114011dc7c","block_type":"box","text":"oversee corporate repor ting and the policies and procedures underpinning the internal audit function and external","page_number":203,"box":{"x":69,"y":842,"width":809,"height":11}},{"id":"3f55fee2-8264-4e53-a594-74087cc4922c","block_type":"box","text":"audit.","page_number":203,"box":{"x":69,"y":857,"width":38,"height":9}},{"id":"b99f477d-a8ba-46e7-b145-c12e2a38a884","block_type":"box","text":"A company’s financial repor ting should provide decision-useful information for investors, and other stakeholders,","page_number":203,"box":{"x":101,"y":875,"width":803,"height":12}},{"id":"18486fdd-721e-4610-b3d4-1541ccb9689b","block_type":"box","text":"on its financial per formance and position. It should provide an accurate and balanced assessment of the risks and","page_number":203,"box":{"x":69,"y":890,"width":819,"height":11}},{"id":"1765fb36-e140-4c66-832e-0dd9d01c9f7f","block_type":"box","text":"oppor tunities the company faces in realizing its long-term strategy. Accordingly, the assumptions made by","page_number":203,"box":{"x":69,"y":905,"width":752,"height":12}},{"id":"d7572d77-f1fc-463d-b6a0-ff7150927404","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":203,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"95be2de1-8421-4c71-8242-9e558f2fe848","block_type":"box","text":"Global Engagement and Voting Guidelines | 8","page_number":203,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"6326be03-fddd-43d2-a4a3-047cd347cdae","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":203,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"4bd91b3b-d97d-4ff5-88ff-67c0bf7dd88c","block_type":"box","text":"management and reviewed by the auditor in preparing the financial statements should be reasonable and justified.","page_number":204,"box":{"x":69,"y":45,"width":817,"height":11}},{"id":"a41f8d8b-4fc7-4f6c-a9b1-921aeb4e7973","block_type":"box","text":"Financial statements should be prepared in accordance with globally developed repor ting standards and any","page_number":204,"box":{"x":70,"y":60,"width":771,"height":11}},{"id":"1753a62f-26d5-4478-9e31-451fb3eae618","block_type":"box","text":"divergence from generally accepted accounting principles should be explained in detail and justified. Accounting","page_number":204,"box":{"x":69,"y":74,"width":796,"height":12}},{"id":"30ea57fc-a18d-419a-8d02-dcbfc418f7e4","block_type":"box","text":"restatements should be explained in detail and any remedial actions, and the implications of these, disclosed.","page_number":204,"box":{"x":69,"y":89,"width":788,"height":11}},{"id":"5319379e-0eb4-4e07-a16b-4b3ad9f732a9","block_type":"box","text":"In this context, audit committees play a vital role in a company’s financial repor ting system by providing","page_number":204,"box":{"x":102,"y":108,"width":739,"height":11}},{"id":"312d3591-5fb8-4537-95fa-959e7f95ff62","block_type":"box","text":"independent oversight of the accounts, material financial and, where appropriate to the jurisdiction, non-financial","page_number":204,"box":{"x":70,"y":123,"width":801,"height":11}},{"id":"19f504e8-7639-4f9d-bd91-efc621982c1c","block_type":"box","text":"information, internal control frameworks and Enterprise Risk Management systems. In our view, effective audit","page_number":204,"box":{"x":70,"y":138,"width":787,"height":11}},{"id":"4d0fca2f-5d34-4faa-b833-c203075df9c5","block_type":"box","text":"committee oversight strengthens the quality and reliability of a company’s financial statements and provides an","page_number":204,"box":{"x":69,"y":152,"width":795,"height":12}},{"id":"efbb4a32-bb74-4a50-9336-fc9caa562e74","block_type":"box","text":"impor tant level of reassurance to shareholders. Audit committees should have a procedure in place for assessing the","page_number":204,"box":{"x":70,"y":167,"width":838,"height":12}},{"id":"8ea818cf-5bc8-48b4-9ecf-9d16306a870d","block_type":"box","text":"independence of the auditor and the quality of the external audit process annually.","page_number":204,"box":{"x":70,"y":182,"width":585,"height":11}},{"id":"76599d3e-8c7b-4542-8936-81328299487d","block_type":"box","text":"Similarly, we encourage companies to disclose material sustainability-related factors that are integral to how a","page_number":204,"box":{"x":102,"y":201,"width":784,"height":11}},{"id":"db501a63-a940-4b00-8c79-80852c05a9bd","block_type":"box","text":"company manages risks or generates revenue. BAIS finds it helpful to our understanding when companies provide","page_number":204,"box":{"x":69,"y":216,"width":812,"height":11}},{"id":"172b1f36-bacc-4661-94d5-ace155358345","block_type":"box","text":"robust, standardized disclosures on their material sustainability-related risks and oppor tunities. The International","page_number":204,"box":{"x":69,"y":231,"width":806,"height":11}},{"id":"25eedd78-a950-445a-8ce1-833898d6479c","block_type":"box","text":"Sustainability Standards Board (ISSB) is one entity working to meet these objectives through its repor ting standards,","page_number":204,"box":{"x":69,"y":246,"width":832,"height":11}},{"id":"01b4326d-25c6-4b75-80c8-358624177197","block_type":"box","text":"which may be helpful to companies in preparing such repor ts.","page_number":204,"box":{"x":68,"y":260,"width":440,"height":12}},{"id":"e628d82b-a0be-44db-8f7b-b193c26337e9","block_type":"box","text":"9","page_number":204,"box":{"x":509,"y":261,"width":5,"height":4}},{"id":"ee5828e7-8bd0-483e-a127-9e1031a324d9","block_type":"box","text":"However, we do not mandate any specific disclosure","page_number":204,"box":{"x":520,"y":260,"width":372,"height":11}},{"id":"8c971285-2e5f-4d67-bf9d-fa1ad04edbc9","block_type":"box","text":"framework, and note that companies in cer tain jurisdictions are subject to mandatory repor ting requirements under","page_number":204,"box":{"x":68,"y":275,"width":824,"height":11}},{"id":"9d58d254-b7e0-464c-a9a7-457b7dcfc2a2","block_type":"box","text":"standards specified by policy makers.","page_number":204,"box":{"x":69,"y":290,"width":267,"height":11}},{"id":"9c43b98f-ab0c-4aab-a9d1-d62653b04666","block_type":"box","text":"10","page_number":204,"box":{"x":338,"y":290,"width":9,"height":5}},{"id":"f2b97e21-8973-4f2d-bb9a-caed4cb1cea9","block_type":"box","text":"Companies should establish robust risk management and internal control processes appropriate to the","page_number":204,"box":{"x":102,"y":309,"width":735,"height":11}},{"id":"1a963313-5f50-4401-9e0a-81a4d35e1153","block_type":"box","text":"company’s business, risk tolerance, and regulatory environment. A credible whistleblowing system for employees,","page_number":204,"box":{"x":69,"y":323,"width":810,"height":12}},{"id":"4e2ccde8-dbee-4d27-8037-45c0d1e380ee","block_type":"box","text":"and potentially other stakeholders, can be a useful mechanism for ensuring that senior management and the board","page_number":204,"box":{"x":69,"y":338,"width":822,"height":12}},{"id":"73c7f22f-f2c6-4dcd-a5b9-c141bd685916","block_type":"box","text":"are aware of potential misconduct or breaches in risk management and internal control processes.","page_number":204,"box":{"x":69,"y":353,"width":704,"height":12}},{"id":"04984adc-ff3e-4d05-8906-5fad6a8dff59","block_type":"box","text":"A comprehensive audit conducted by an independent audit firm contributes to investor confidence in the quality","page_number":204,"box":{"x":101,"y":372,"width":794,"height":11}},{"id":"18401ba4-b2ff-42bf-a0f1-488dcadf38bb","block_type":"box","text":"of corporate repor ting. It is helpful when the audit repor t gives some insight into the scope and focus of the audit, as","page_number":204,"box":{"x":69,"y":387,"width":836,"height":11}},{"id":"3c9b4ce7-47ba-411b-b681-44d4f7178686","block_type":"box","text":"well as any critical audit matters identified and how these were resolved. A comprehensive and effective audit is time","page_number":204,"box":{"x":68,"y":402,"width":838,"height":11}},{"id":"fa82cf11-4c5f-4f58-87ba-70b2e254a397","block_type":"box","text":"and resource intensive, and the audit fee should be commensurate. Fees paid to the audit firm for non-audit","page_number":204,"box":{"x":69,"y":416,"width":773,"height":11}},{"id":"62d533c1-1813-413a-acc8-a893bb99a629","block_type":"box","text":"consulting should not exceed the audit fee to a degree that may prompt concerns about the independence of the","page_number":204,"box":{"x":69,"y":431,"width":804,"height":12}},{"id":"7439d457-18dc-41b6-ae1a-c43d5339a0f1","block_type":"box","text":"audit. The audit committee should explain its position on auditor tenure and how it confirmed that the auditor","page_number":204,"box":{"x":69,"y":446,"width":780,"height":11}},{"id":"1399c266-dfdb-48d3-b496-c431886565a5","block_type":"box","text":"remained independent.","page_number":204,"box":{"x":69,"y":461,"width":163,"height":11}},{"id":"6e5c35a0-5574-43d2-ab3e-b7bd35379ef5","block_type":"box","text":"We may vote against the election of the responsible directors if corporate repor ting is insufficient or there are","page_number":204,"box":{"x":101,"y":480,"width":783,"height":11}},{"id":"36b89ccc-6769-4a5e-b588-8a91b3b82733","block_type":"box","text":"material misstatements in financial repor ts. In markets where relevant, we may vote against a proposal to approve","page_number":204,"box":{"x":69,"y":495,"width":819,"height":11}},{"id":"c035d025-fe79-4512-a1b8-4dd8500cec74","block_type":"box","text":"the financial statements or the discharge of the board when we are concerned about the quality of corporate","page_number":204,"box":{"x":68,"y":509,"width":774,"height":12}},{"id":"82fd022c-d911-476c-a06f-0b06095b4929","block_type":"box","text":"repor ting or the audit. We may vote against proposals to appoint the auditor, ratify the audit repor t, or approve the","page_number":204,"box":{"x":69,"y":524,"width":816,"height":12}},{"id":"b71ad879-32c1-475c-b6b6-ffe875028415","block_type":"box","text":"audit fee if we are concerned about the auditor’s independence, the quality of the audit, or there are material","page_number":204,"box":{"x":69,"y":539,"width":779,"height":11}},{"id":"8202131e-9a43-48fe-9442-509323412216","block_type":"box","text":"misstatements in financial repor ts and the board has not established reasonable remediation plans.","page_number":204,"box":{"x":69,"y":554,"width":718,"height":11}},{"id":"18b49e72-9df0-4dfc-85e5-50934e5186e8","block_type":"box","text":"SHAREHOLDER RIGHTS AND PROTECTIONS","page_number":204,"box":{"x":329,"y":584,"width":319,"height":9}},{"id":"14fc9a91-f787-4b3a-8071-eb7c3e907512","block_type":"box","text":"General shareholder meetings","page_number":204,"box":{"x":69,"y":607,"width":217,"height":11}},{"id":"08fe1b61-7992-4ecc-a9c8-1df99296d4ae","block_type":"box","text":"Companies normally have an annual general meeting of shareholders at which routine and non-routine items of","page_number":204,"box":{"x":102,"y":625,"width":792,"height":12}},{"id":"94cbfe2d-52ef-4718-8ddc-9fd2099a0ab2","block_type":"box","text":"business are discussed and voted on by shareholders in attendance or submitting proxy votes. Companies should","page_number":204,"box":{"x":69,"y":640,"width":812,"height":11}},{"id":"b6113a5e-e00a-4de3-a30f-9d63550e476b","block_type":"box","text":"disclose materials relevant to the shareholder meeting sufficiently in advance so that shareholders can take them","page_number":204,"box":{"x":69,"y":655,"width":813,"height":11}},{"id":"08fbff29-7dae-4ffc-9677-22ff8e97cda7","block_type":"box","text":"into consideration in their voting decisions. Many companies offer shareholders the option of par ticipating in the","page_number":204,"box":{"x":70,"y":670,"width":801,"height":11}},{"id":"bacf3ad2-0083-40cd-bb40-eb2599601c44","block_type":"box","text":"meeting vir tually which, whilst welcome, should not limit the rights of shareholders to par ticipate as they would during","page_number":204,"box":{"x":69,"y":685,"width":841,"height":11}},{"id":"dfb48893-3b9e-411a-b2cb-e56739bfd296","block_type":"box","text":"an in-person meeting.","page_number":204,"box":{"x":69,"y":700,"width":152,"height":11}},{"id":"73b3ae5f-f31c-49e3-a121-9b57dc44b526","block_type":"box","text":"We may vote against directors when materials related to the business of the shareholder meeting are not","page_number":204,"box":{"x":101,"y":718,"width":752,"height":12}},{"id":"e69bd992-ccae-44c7-9400-7c09c3b6175d","block_type":"box","text":"provided in a timely manner or do not provide sufficient information for us to make an informed voting decision. We","page_number":204,"box":{"x":70,"y":733,"width":821,"height":11}},{"id":"be736366-aaad-4746-bbf1-33a0524b053c","block_type":"box","text":"may vote against directors if the format of the shareholder meeting does not accommodate reasonable shareholder","page_number":204,"box":{"x":69,"y":748,"width":825,"height":11}},{"id":"c261223c-6a5e-4cd0-8e3d-f8e60a6c5dde","block_type":"box","text":"par ticipation.","page_number":204,"box":{"x":70,"y":763,"width":91,"height":11}},{"id":"002f4ada-2bbc-4b66-961a-55d99e5d4d69","block_type":"box","text":"9","page_number":204,"box":{"x":69,"y":793,"width":4,"height":4}},{"id":"d3b726e7-c3d3-4e63-9ee7-d589fc51b733","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Repor ting Standards","page_number":204,"box":{"x":93,"y":792,"width":744,"height":11}},{"id":"b2951352-5bf0-483d-acd1-5ad97f3722ce","block_type":"box","text":"(IFRS) Foundation. Please refer to the IFRS website to learn more about the framework and standards S1","page_number":204,"box":{"x":94,"y":807,"width":748,"height":11}},{"id":"b2a07749-bd57-4e83-ab31-2e6e5ed624e1","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":204,"box":{"x":94,"y":822,"width":778,"height":12}},{"id":"b93a60a4-a2e4-4f55-bf22-b12296c3d794","block_type":"box","text":"Disclosures.”","page_number":204,"box":{"x":94,"y":838,"width":93,"height":8}},{"id":"0c0c7daa-d707-471b-8a8f-84da111828fc","block_type":"box","text":"10","page_number":204,"box":{"x":69,"y":856,"width":9,"height":4}},{"id":"ee5886ba-0388-40a3-9b12-0ce6702dae19","block_type":"box","text":"See, for examples, https://www.ifrs.org/news-and-events/news/2025/06/ifrs-foundation-publishes-jurisdictional- profiles\r\nissbstandards/ and https//financeeceropae/capitalmarketsnionandfinancialmarkets/compan","page_number":204,"box":{"x":93,"y":858,"width":810,"height":11}},{"id":"b88f0ccb-1457-48ba-a64d-77b99ee01a71","block_type":"box","text":"See, for examples, https://www.ifrs.org/newsandevents/news/2025/06/ifrsfoundationpublishesjurisdictional\r\nprofiles-issb-standards/ and https://finance.ec.europa.eu/capital-markets-union-and-financial-markets/companyrepor ting\r\nandaditing/companrepor ting/corporatesstainabilitrepor tingen","page_number":204,"box":{"x":94,"y":866,"width":804,"height":12}},{"id":"b9d5b9f0-80c7-45eb-ac26-9596ef6d5c3a","block_type":"box","text":"p/ p//p/p\r\nrepor ting-and-auditing/company-repor ting/corporate-sustainability-repor ting_en.","page_number":204,"box":{"x":94,"y":876,"width":564,"height":11}},{"id":"2af4dc6a-f98f-4a3e-aa78-ffa67f18ef1a","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":204,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"ef4f0450-6bd3-483a-b6ed-e0d726225766","block_type":"box","text":"Global Engagement and Voting Guidelines | 9","page_number":204,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"99eff253-9de3-4f2e-8af7-4a2f0754429a","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":204,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"9314ea33-1d15-44ce-b5e4-8e49c448fc58","block_type":"box","text":"Bylaw amendments","page_number":205,"box":{"x":69,"y":45,"width":141,"height":11}},{"id":"6ab5b865-2243-43f9-a2b3-2bb5494e2674","block_type":"box","text":"We review bylaw amendments proposed by management on a case-by-case basis and will generally suppor t","page_number":205,"box":{"x":101,"y":64,"width":766,"height":11}},{"id":"11c8d847-22b9-4175-b9a1-0baee20862c8","block_type":"box","text":"those that are aligned with the interests of minority shareholders. Any material changes to the bylaws should be","page_number":205,"box":{"x":68,"y":78,"width":800,"height":11}},{"id":"50b776ec-c8b0-4492-b507-16896da4ef21","block_type":"box","text":"explained in detail and put to a shareholder vote.","page_number":205,"box":{"x":69,"y":93,"width":349,"height":11}},{"id":"421239e9-c9bd-49eb-9eda-af2bc86c3778","block_type":"box","text":"We may vote against bylaw amendments that reduce shareholder rights and protections or introduce additional","page_number":205,"box":{"x":101,"y":112,"width":790,"height":11}},{"id":"ac769a05-a558-4793-883b-346c8733022e","block_type":"box","text":"burdens. We may vote against directors if material changes are made to the bylaws without shareholder approval.","page_number":205,"box":{"x":69,"y":126,"width":810,"height":12}},{"id":"8a6ba6b2-887a-4c71-9e42-def2ee464786","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders, individually or as a","page_number":205,"box":{"x":102,"y":145,"width":790,"height":11}},{"id":"662ee4fa-ebf0-4868-afa6-cc9a7da12044","block_type":"box","text":"group, with a meaningful shareholding, the right to call a special meeting of shareholders. The shareholding required","page_number":205,"box":{"x":68,"y":160,"width":831,"height":11}},{"id":"7c708a30-bb56-452c-bd72-5176a38b26f9","block_type":"box","text":"to exercise this right should balance its utility with the cost to the company of holding special meetings.","page_number":205,"box":{"x":68,"y":175,"width":740,"height":11}},{"id":"6726f0f3-5563-4a28-8488-ec2d79d2b0b2","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders, individually or as a","page_number":205,"box":{"x":102,"y":193,"width":790,"height":12}},{"id":"7ff7e46a-5911-452e-b123-0b4ae9e02947","block_type":"box","text":"group, with a meaningful shareholding, the right to nominate directors to the company’s board. The threshold for this","page_number":205,"box":{"x":68,"y":208,"width":834,"height":12}},{"id":"37e943a7-2fe7-49b8-bc42-6a4617fff2b5","block_type":"box","text":"right should be set so that shareholders can exercise it without being unduly disruptive to the board’s own","page_number":205,"box":{"x":69,"y":223,"width":758,"height":12}},{"id":"f79c9b9f-7fcc-4257-a969-34c5608c7bfe","block_type":"box","text":"nomination process.","page_number":205,"box":{"x":69,"y":238,"width":143,"height":11}},{"id":"8dee21af-7c36-4719-aecc-0f4cadeb72ab","block_type":"box","text":"Whilst we would not use either of these rights ourselves, we see them as impor tant accountability mechanisms.","page_number":205,"box":{"x":101,"y":257,"width":799,"height":11}},{"id":"c71aee46-39a7-4eb5-9dc1-b9298df1cb6a","block_type":"box","text":"We may vote for a shareholder proposal seeking the addition of either of these provisions to a company’s bylaws.","page_number":205,"box":{"x":68,"y":272,"width":810,"height":11}},{"id":"7e55e23d-8b64-486a-82a3-27a76f81b3a4","block_type":"box","text":"Change of domicile","page_number":205,"box":{"x":69,"y":294,"width":139,"height":11}},{"id":"745c41e9-4fda-4a73-b682-438b47161f03","block_type":"box","text":"We generally defer to management on proposals to change a company’s domicile as long as the rationale for","page_number":205,"box":{"x":101,"y":313,"width":778,"height":11}},{"id":"babc52b6-5861-4250-aa7f-7078541293c2","block_type":"box","text":"doing so is consistent with the company’s long-term strategy and business model and the related costs are","page_number":205,"box":{"x":69,"y":328,"width":766,"height":11}},{"id":"322de296-c305-4c1d-961b-f2e7e627a648","block_type":"box","text":"immaterial.","page_number":205,"box":{"x":70,"y":343,"width":77,"height":8}},{"id":"bfeba5e2-08a0-48a8-b1ec-99442cd3bade","block_type":"box","text":"We may vote against directors or a proposal to change a company’s domicile where it does not seem aligned","page_number":205,"box":{"x":101,"y":361,"width":777,"height":11}},{"id":"eae95790-5cbe-43a1-b376-4515d66d8250","block_type":"box","text":"with our clients’ financial interests.","page_number":205,"box":{"x":68,"y":376,"width":249,"height":9}},{"id":"2b2ed692-5a23-4699-940e-e867e4623607","block_type":"box","text":"Changes to a company’s purpose or the nature of its business","page_number":205,"box":{"x":69,"y":398,"width":452,"height":11}},{"id":"ef614e39-a26c-48e4-b472-323df11c6ded","block_type":"box","text":"Plans to materially change the nature of a company’s business or its purpose should be disclosed and explained","page_number":205,"box":{"x":102,"y":417,"width":803,"height":11}},{"id":"dc100711-28a5-4532-aa48-fa1e0487944e","block_type":"box","text":"in the context of long-term strategy and business dynamics. Such changes may significantly alter an investor’s views","page_number":205,"box":{"x":70,"y":432,"width":829,"height":11}},{"id":"855cf85e-5b35-4aaa-978c-49fe04ec8c61","block_type":"box","text":"on the suitability of a company for their investment strategy or por tfolio.","page_number":205,"box":{"x":69,"y":447,"width":511,"height":11}},{"id":"25a66475-2f94-4f39-9a38-a9418b0bbd7a","block_type":"box","text":"Where relevant, we may vote against proposals to change a company’s purpose or the nature of its business if","page_number":205,"box":{"x":101,"y":465,"width":792,"height":12}},{"id":"67661dbe-4e17-4c7b-9a4f-d60031aa76cd","block_type":"box","text":"the board has not provided a credible argument for change.","page_number":205,"box":{"x":68,"y":480,"width":424,"height":12}},{"id":"52a97935-ff26-47ba-a373-e34e0bad9345","block_type":"box","text":"SHAREHOLDER PROPOSALS","page_number":205,"box":{"x":385,"y":510,"width":207,"height":9}},{"id":"587b7a86-82bf-4de3-81cf-186cf48c82be","block_type":"box","text":"Shareholders in many markets, who meet cer tain eligibility criteria, have the right to submit proposals to the","page_number":205,"box":{"x":102,"y":529,"width":772,"height":11}},{"id":"fbef9ad9-ddc4-4e2c-8902-9ca826b3c88d","block_type":"box","text":"general shareholder meeting asking a company to take a par ticular course of action subject to the proposal being","page_number":205,"box":{"x":68,"y":544,"width":811,"height":11}},{"id":"95c8cf6b-d5d2-46ad-8b55-b60c4c36a5a6","block_type":"box","text":"suppor ted by a majority of votes cast at the meeting. The topics raised can address a range of matters that may be","page_number":205,"box":{"x":69,"y":559,"width":824,"height":11}},{"id":"1111345e-283e-4742-ac77-13c2fb602a44","block_type":"box","text":"relevant to a company’s business.","page_number":205,"box":{"x":69,"y":574,"width":243,"height":11}},{"id":"6c4b0ab2-420b-4523-8ea8-1e82fb05c075","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":205,"box":{"x":101,"y":592,"width":730,"height":11}},{"id":"7e5a7dd5-ceb2-43d6-9448-b25d31c1281b","block_type":"box","text":"company’s business and its current approach, whether the actions sought are consistent with shareholders’","page_number":205,"box":{"x":69,"y":607,"width":772,"height":11}},{"id":"8346a132-4534-4386-a8e6-15d034fbf56b","block_type":"box","text":"interests, and what impact the proposal being acted upon might have on financial per formance.","page_number":205,"box":{"x":70,"y":622,"width":681,"height":11}},{"id":"b921af07-5ad2-4261-8678-57d8a3e8f4fa","block_type":"box","text":"Our general approach where we have concerns about a company’s governance, disclosures or per formance is to","page_number":205,"box":{"x":102,"y":641,"width":801,"height":11}},{"id":"44ba23b6-f2f9-432c-8229-fb5d269778b2","block_type":"box","text":"engage to understand the apparent difference in perspective. If we are concerned a company is not acting in","page_number":205,"box":{"x":69,"y":656,"width":774,"height":11}},{"id":"76aa9292-4c9c-421b-b50e-41f434d2ccce","block_type":"box","text":"shareholders’ financial interests, we may vote against the election of directors. We may suppor t a relevant","page_number":205,"box":{"x":69,"y":670,"width":761,"height":12}},{"id":"68e46531-7fe7-4a3d-b577-57705cab72e5","block_type":"box","text":"shareholder proposal if doing so is aligned with our clients’ financial interests. We generally do not suppor t","page_number":205,"box":{"x":69,"y":685,"width":764,"height":12}},{"id":"9c93eb1b-08c9-4859-b404-84dce43f76aa","block_type":"box","text":"shareholder proposals that are legally binding on the company, seek to alter a company’s strategy or direct its","page_number":205,"box":{"x":69,"y":700,"width":785,"height":11}},{"id":"1f2f1ce5-61ce-4ba9-9148-7c26f78e25b9","block_type":"box","text":"operations, or are unrelated to how a company manages risk or generates financial returns.","page_number":205,"box":{"x":69,"y":715,"width":653,"height":11}},{"id":"802a93a9-48af-4c86-87b7-8d47595c51fe","block_type":"box","text":"BlackRock is subject to rules, regulations, agency guidance and contractual agreements that place restrictions","page_number":205,"box":{"x":102,"y":734,"width":788,"height":11}},{"id":"635a8a07-dbc8-4bb2-8f16-6e5e57d2a3e2","block_type":"box","text":"and limitations on how we can interact with the companies in which we invest on behalf of our clients, including our","page_number":205,"box":{"x":69,"y":748,"width":822,"height":12}},{"id":"add594af-8277-42a8-9496-bf67e023c674","block_type":"box","text":"ability to submit shareholder proposals. We do not submit shareholder proposals but can vote, on behalf of clients","page_number":205,"box":{"x":69,"y":763,"width":817,"height":12}},{"id":"6b65af57-13aa-4774-b546-6cfa602aeca8","block_type":"box","text":"who authorize us to do so, on proposals put for th by others.","page_number":205,"box":{"x":68,"y":778,"width":428,"height":11}},{"id":"ba25787a-a8d7-40c1-80f0-8490d08e9a09","block_type":"box","text":"CORPORATE POLITICAL ACTIVITIES","page_number":205,"box":{"x":359,"y":808,"width":260,"height":9}},{"id":"3969c011-1e07-425b-bcc3-172c184c82a6","block_type":"box","text":"A corporation’s ability to engage in the policy process is subject to rules and regulations set by the jurisdictions","page_number":205,"box":{"x":101,"y":827,"width":795,"height":11}},{"id":"dbe4331e-45ab-411f-9b34-4cb5e91bfdbc","block_type":"box","text":"in which they engage. When a corporation repor ts material financial risk related to policy and or regulatory changes,","page_number":205,"box":{"x":70,"y":842,"width":824,"height":11}},{"id":"2a0d1646-ccdf-4130-a11e-278f473b977b","block_type":"box","text":"BAIS may seek to understand how it is addressing the material risk identified. We seek to understand how","page_number":205,"box":{"x":70,"y":857,"width":757,"height":11}},{"id":"9fb8e1e5-9ac1-4a20-856a-914c3e52928e","block_type":"box","text":"companies engage in corporate political activities and ensure that their par ticipation is consistent with their public","page_number":205,"box":{"x":69,"y":872,"width":814,"height":11}},{"id":"8e737871-5a17-4076-8bc8-0844c85a8181","block_type":"box","text":"statements on policy matters material to the company’s long-term strategy. The board should be aware of the","page_number":205,"box":{"x":69,"y":887,"width":780,"height":11}},{"id":"b3a8fc68-8028-4d48-803d-361cc0d9d2f2","block_type":"box","text":"approach taken by management on corporate political activities as there can be reputational risks arising from","page_number":205,"box":{"x":69,"y":901,"width":786,"height":12}},{"id":"d67b030d-df4b-42cf-ab61-bee6b03b2cb3","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":205,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"1b0c1992-92a2-493e-9250-9c33a0dc80c5","block_type":"box","text":"Global Engagement and Voting Guidelines | 10","page_number":205,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"2a2b7177-3c9e-4578-9a93-eb0e6f4ee940","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":205,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"38848f65-0b69-4503-9fe4-25ae8073727e","block_type":"box","text":"inconsistencies between a company’s policy engagement and stated policy positions. Companies should, as a","page_number":206,"box":{"x":70,"y":45,"width":786,"height":11}},{"id":"c5a62d5c-f31f-4304-83a5-3302294b5294","block_type":"box","text":"minimum, meet all regulatory disclosure requirements on political activities. We may engage a company where we","page_number":206,"box":{"x":69,"y":60,"width":812,"height":11}},{"id":"c1232fdd-d23b-4036-9692-4ce61b677e3f","block_type":"box","text":"would like to better understand its approach to policy engagement, where relevant.","page_number":206,"box":{"x":68,"y":75,"width":590,"height":11}},{"id":"28fa0cdb-c600-49c5-9f9a-5bd2ddd9f3e4","block_type":"box","text":"To mitigate the risk of inconsistencies, companies may wish to assess the alignment between their policy","page_number":206,"box":{"x":101,"y":93,"width":753,"height":11}},{"id":"3f16e907-2c4b-4e0e-b05a-3ef9b877adb1","block_type":"box","text":"priorities and the policy positions of the trade associations of which they are active members and any engagements","page_number":206,"box":{"x":70,"y":108,"width":823,"height":11}},{"id":"e3836eec-77bf-49b7-a805-f73cb4ef17fd","block_type":"box","text":"under taken by trade associations on behalf of members.","page_number":206,"box":{"x":69,"y":123,"width":404,"height":11}},{"id":"7b38ac88-7a1e-4b4d-8830-b338d54be25a","block_type":"box","text":"We may suppor t a relevant shareholder proposal, or vote against directors, where a company’s disclosures are","page_number":206,"box":{"x":101,"y":142,"width":793,"height":11}},{"id":"592df45e-1171-408e-8382-702c53093f3c","block_type":"box","text":"insufficient to address the material risk it has identified.","page_number":206,"box":{"x":70,"y":156,"width":400,"height":9}},{"id":"c0bf7bb2-55fd-4801-be94-63262f6439b0","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":206,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"85c80317-f430-4d5e-92b3-ca0fed8ce42f","block_type":"box","text":"Global Engagement and Voting Guidelines | 11","page_number":206,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"34385233-2add-41a4-a706-8f2c3486a1d2","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":206,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"98d9d42c-8763-4ecf-abbc-6119dca69649","block_type":"box","text":"MATERIAL SUSTAINABILITY- RELATED RISKS AND OPPORTUNITIES","page_number":207,"box":{"x":245,"y":45,"width":489,"height":9}},{"id":"a3245726-c9b6-41d7-a404-23c9b6f647fe","block_type":"box","text":"We seek to understand how companies manage the material risks and oppor tunities inherent in their business","page_number":207,"box":{"x":101,"y":64,"width":790,"height":11}},{"id":"e071b610-10a5-476f-896c-2ae1618318e5","block_type":"box","text":"operations. In our experience, sustainability-related factors","page_number":207,"box":{"x":69,"y":78,"width":418,"height":12}},{"id":"f15edbdf-0f09-43fa-b178-1e77cfe0c326","block_type":"box","text":"11","page_number":207,"box":{"x":488,"y":79,"width":9,"height":4}},{"id":"3c9e9510-0c88-42fb-9df1-84ae8d21f3a3","block_type":"box","text":"that are relevant to a company’s business or material to","page_number":207,"box":{"x":502,"y":79,"width":402,"height":11}},{"id":"6b5bdbd1-8a90-4a3d-8665-70fb7965ef17","block_type":"box","text":"its financial per formance, are generally operational considerations embedded into day-to-day management systems.","page_number":207,"box":{"x":70,"y":93,"width":824,"height":12}},{"id":"b26c0eef-5d39-4b54-9ec2-633e21f58a69","block_type":"box","text":"Cer tain sustainability issues may also inform long-term strategic planning, for example, investing in product","page_number":207,"box":{"x":69,"y":108,"width":766,"height":11}},{"id":"350d4dfa-4d4a-49e5-9819-35bfac43247a","block_type":"box","text":"innovation in anticipation of changing consumer demand or adapting supply chains in response to changing","page_number":207,"box":{"x":70,"y":123,"width":764,"height":11}},{"id":"378c8316-95b5-4d9b-adba-9ef7cd4b3497","block_type":"box","text":"regulatory requirements.","page_number":207,"box":{"x":69,"y":138,"width":174,"height":11}},{"id":"782d3ace-1915-4690-ba64-766b816e7c3b","block_type":"box","text":"We recognize that the specific sustainability-related factors that may be financially material or business relevant","page_number":207,"box":{"x":101,"y":156,"width":798,"height":12}},{"id":"f37edc88-5387-439d-9a9e-1c80e0a4ca77","block_type":"box","text":"will vary by company business model, sector, key markets, and time horizon, amongst other considerations. From","page_number":207,"box":{"x":68,"y":172,"width":809,"height":11}},{"id":"c8df42a4-7e22-494b-bd62-9a0de82e7a72","block_type":"box","text":"company disclosures and our engagement, we aim to understand how management is identifying, assessing and","page_number":207,"box":{"x":69,"y":186,"width":803,"height":12}},{"id":"6bb26007-3ca6-4b6d-a1a3-de57dc9a0bae","block_type":"box","text":"integrating material sustainability-related risks and oppor tunities into their business decision-making and practices.","page_number":207,"box":{"x":70,"y":201,"width":820,"height":11}},{"id":"45392ee9-2baa-4d0d-adec-c4d160a4dd5a","block_type":"box","text":"Doing so helps us under take a more holistic assessment of a company’s potential financial per formance and the","page_number":207,"box":{"x":70,"y":216,"width":808,"height":11}},{"id":"bc49f10a-0f0f-42e8-8752-723fa926a225","block_type":"box","text":"likely risk-adjusted returns of an investment.","page_number":207,"box":{"x":70,"y":231,"width":313,"height":11}},{"id":"97eb2ed5-7056-4c9e-9efd-3e6e2ea8b447","block_type":"box","text":"We may vote against directors or suppor t a relevant shareholder proposal if we have concerns about how a","page_number":207,"box":{"x":101,"y":249,"width":764,"height":12}},{"id":"92ee8de4-3fb1-40ab-8119-619bb350526e","block_type":"box","text":"company is managing or disclosing its approach to material sustainability-related risks that may impact financial","page_number":207,"box":{"x":69,"y":264,"width":798,"height":12}},{"id":"a6795b8b-93d7-48e7-82e1-0f8128e194e2","block_type":"box","text":"returns.","page_number":207,"box":{"x":69,"y":280,"width":54,"height":8}},{"id":"0741826f-2e75-4f0c-abc5-6da2aa0f3ead","block_type":"box","text":"KEY STAKEHOLDERS","page_number":207,"box":{"x":414,"y":309,"width":151,"height":9}},{"id":"2db4fe22-d92a-49d7-9898-157694025cdc","block_type":"box","text":"In our view, companies should understand and take into consideration the interests of the various par ties on","page_number":207,"box":{"x":102,"y":328,"width":774,"height":11}},{"id":"fceece54-cedf-4efb-a04e-620329e17377","block_type":"box","text":"whom they depend for their success over time. It is for each company to determine their key stakeholders based on","page_number":207,"box":{"x":68,"y":343,"width":826,"height":11}},{"id":"1c1ee362-0cb0-45cc-8b3d-63b105570569","block_type":"box","text":"what is material to their business and long-term financial per formance. For many companies, key stakeholders","page_number":207,"box":{"x":68,"y":358,"width":790,"height":11}},{"id":"c12ccf3d-4de6-4ac1-a6ae-fd67f04692b7","block_type":"box","text":"include employees, business par tners (such as suppliers and distributors), clients and consumers, regulators, and","page_number":207,"box":{"x":70,"y":373,"width":817,"height":11}},{"id":"9539c206-a317-4fec-8b8c-2bfc7c0428f8","block_type":"box","text":"the communities in which they operate. Companies that appropriately balance the interests of investors and other","page_number":207,"box":{"x":68,"y":387,"width":813,"height":12}},{"id":"e455abc7-8c02-40e2-994b-7ee838bc1cc1","block_type":"box","text":"stakeholders are, in our experience, more likely to be financially resilient over time.","page_number":207,"box":{"x":69,"y":402,"width":592,"height":12}},{"id":"4164b2d1-94e3-4a13-82bb-9f4a21d03356","block_type":"box","text":"CLIMATE AND DECARBONIZATION INVESTMENT OBJECTIVES","page_number":207,"box":{"x":265,"y":432,"width":448,"height":9}},{"id":"0d6fff6f-5af9-4b1c-b9d7-862a5ea74475","block_type":"box","text":"Cer tain active BlackRock funds have climate and decarbonization objectives in addition to financial objectives.","page_number":207,"box":{"x":102,"y":451,"width":784,"height":11}},{"id":"63ca83bf-883f-4891-b286-0f44d306caa3","block_type":"box","text":"Consistent with the objectives of those investment strategies, our stewardship activity in relation to the holdings in","page_number":207,"box":{"x":69,"y":466,"width":818,"height":11}},{"id":"ffecf2ef-8bdb-4903-879a-c9931233a0a7","block_type":"box","text":"those funds differs in some respects from BAIS’ benchmark guidelines, which are described above. Specifically, for","page_number":207,"box":{"x":68,"y":481,"width":823,"height":11}},{"id":"db57119d-d45f-4ec7-ab1e-015eea39fdd1","block_type":"box","text":"those funds’ holdings, we look to investee companies to demonstrate that they are aligned with a decarbonization","page_number":207,"box":{"x":68,"y":496,"width":814,"height":11}},{"id":"128dad50-cf73-4c9a-8a89-3b94ae69e8ac","block_type":"box","text":"pathway that means their business model would be viable in a low-carbon economy,","page_number":207,"box":{"x":70,"y":511,"width":594,"height":11}},{"id":"ce53b364-4610-4281-96c7-0ba62a67111c","block_type":"box","text":"i.e.","page_number":207,"box":{"x":672,"y":511,"width":20,"height":9}},{"id":"44b36021-c1fc-48b5-bc68-89f99d1357e7","block_type":"box","text":", one in which global","page_number":207,"box":{"x":694,"y":511,"width":144,"height":11}},{"id":"e1f9fe99-b88e-409f-819a-b5d7d36dc08a","block_type":"box","text":"temperature rise is limited to 1.5°C above pre-industrial levels. In addition, clients in separately managed accounts","page_number":207,"box":{"x":68,"y":526,"width":821,"height":11}},{"id":"718b4c44-aa71-4faf-a373-c26217446ee5","block_type":"box","text":"may instruct BlackRock to apply these guidelines to their holdings. Both in the case of funds and separately managed","page_number":207,"box":{"x":69,"y":540,"width":839,"height":12}},{"id":"1f13f04c-6c83-44f2-af2a-f74a2dae32c3","block_type":"box","text":"accounts, these guidelines are only implemented upon explicit selection and approval by the applicable fund board or","page_number":207,"box":{"x":69,"y":555,"width":837,"height":12}},{"id":"831ff523-bb76-4867-8ab8-0e0137cd3b8d","block_type":"box","text":"client.","page_number":207,"box":{"x":69,"y":570,"width":41,"height":9}},{"id":"1073e570-ab8e-462b-9db8-d1686a6db734","block_type":"box","text":"These decarbonization stewardship guidelines focus on companies which produce goods and services that","page_number":207,"box":{"x":101,"y":589,"width":761,"height":11}},{"id":"30a42395-69fa-4f6a-b803-beeecc61099f","block_type":"box","text":"contribute to real world decarbonization or have a carbon intensive business model and face outsized impacts from","page_number":207,"box":{"x":69,"y":604,"width":821,"height":11}},{"id":"bdda7d7f-25f5-4c75-9385-74267ea48891","block_type":"box","text":"the low carbon transition, based on repor ted and estimated scopes 1, 2, and 3 greenhouse gas emissions. These","page_number":207,"box":{"x":68,"y":619,"width":817,"height":11}},{"id":"1a68a561-3f5c-48b9-8427-ac6e729f4aaf","block_type":"box","text":"companies should provide disclosures that set out their governance, strategy, risk management processes and","page_number":207,"box":{"x":69,"y":634,"width":792,"height":11}},{"id":"cb796c41-124b-4bb7-ba0c-1c07b0ec9514","block_type":"box","text":"metrics and targets relevant to decarbonization. It is helpful to investors’ understanding when these disclosures","page_number":207,"box":{"x":69,"y":648,"width":799,"height":12}},{"id":"d2acfb8a-d9fa-4c24-97e9-ffb3e878c196","block_type":"box","text":"include an explanation of the decarbonization scenarios a company is using in its near- and long-term planning, as","page_number":207,"box":{"x":70,"y":663,"width":812,"height":11}},{"id":"52e7b58d-b02e-47c0-a887-1f2972e1fba9","block_type":"box","text":"well as its scope 1, scope 2 and material scope 3 greenhouse gas (GHG) emissions and reduction targets for scope","page_number":207,"box":{"x":68,"y":678,"width":831,"height":11}},{"id":"95127254-878c-407c-8b8f-e7630c69b8f8","block_type":"box","text":"1 and 2 emissions.","page_number":207,"box":{"x":70,"y":693,"width":135,"height":9}},{"id":"da9e67a8-5028-4a7a-89eb-8da0d5515b3c","block_type":"box","text":"Under these climate- and decarbonization-specific guidelines, BAIS may recommend a vote against directors or","page_number":207,"box":{"x":102,"y":711,"width":788,"height":12}},{"id":"b81ebec0-7deb-44c7-86ca-b8abf2fef860","block_type":"box","text":"suppor t for a relevant shareholder proposal if a company does not appear to be adequately acting to address or","page_number":207,"box":{"x":69,"y":726,"width":800,"height":12}},{"id":"38ee7381-46ab-47d6-939f-d5860b5307ea","block_type":"box","text":"disclosing material climate-related risks, consistent with the parameters set out in these climate-and decarbonization","page_number":207,"box":{"x":69,"y":741,"width":839,"height":12}},{"id":"a0685857-c784-4245-99cc-0a17fa5ea216","block_type":"box","text":"specific guidelines. We may recommend suppor ting shareholder proposals seeking information relevant to a","page_number":207,"box":{"x":69,"y":756,"width":771,"height":11}},{"id":"87f6f281-2987-4e32-8693-cf0026883a22","block_type":"box","text":"11","page_number":207,"box":{"x":69,"y":786,"width":9,"height":4}},{"id":"f0ca9d6d-1753-4387-9647-fa21ec7d22bf","block_type":"box","text":"By material sustainability-related risks and oppor tunities, we mean the drivers of risk and financial value creation in","page_number":207,"box":{"x":84,"y":785,"width":822,"height":11}},{"id":"3c352c36-20a3-4244-aa03-dec5c0742065","block_type":"box","text":"a company’s business model that have an environmental or social dependency or impact. Examples of environmental","page_number":207,"box":{"x":69,"y":800,"width":835,"height":12}},{"id":"dab7e5f9-87cd-43ea-9f33-bf5bd93ebced","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":207,"box":{"x":70,"y":816,"width":827,"height":11}},{"id":"405a8770-5e48-4502-9d94-2a752fc2064f","block_type":"box","text":"issues include, but are not limited to, human capital management, impacts on the communities in which a company","page_number":207,"box":{"x":70,"y":831,"width":826,"height":11}},{"id":"d906c229-4ec9-4ed5-8ae2-2762d272cecd","block_type":"box","text":"operates, customer loyalty, and relationships with regulators. It is our view that well-managed companies will","page_number":207,"box":{"x":69,"y":846,"width":773,"height":11}},{"id":"315426a8-5e90-46b1-9b71-ee5e1e8db187","block_type":"box","text":"effectively evaluate and manage material sustainability-related risks and oppor tunities relevant to their businesses.","page_number":207,"box":{"x":69,"y":861,"width":823,"height":11}},{"id":"8387fa5d-0825-4e46-ab38-5f9ce0ef4f3a","block_type":"box","text":"Governance is the core means by which boards can oversee the creation of durable financial value over time.","page_number":207,"box":{"x":69,"y":876,"width":777,"height":11}},{"id":"07847610-b531-4f87-9e82-9ecaedd550f3","block_type":"box","text":"Appropriate risk oversight of business-relevant and material sustainability-related considerations is a component of a","page_number":207,"box":{"x":68,"y":891,"width":833,"height":11}},{"id":"453c13f0-d19f-4e0a-8364-e7272286cfd3","block_type":"box","text":"sound governance framework.","page_number":207,"box":{"x":69,"y":906,"width":212,"height":12}},{"id":"95a247be-98a8-46eb-a0d9-c09d2d58bddb","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":207,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"2151e9ee-0cda-4aa5-9d44-df6549becb1f","block_type":"box","text":"Global Engagement and Voting Guidelines | 12","page_number":207,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"d94c013c-bdbc-4d2c-a536-dbf97720a516","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":207,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"7fa2090a-b495-43f4-9b5e-8651320f72ad","block_type":"box","text":"company’s stated low-carbon transition strategy or targets that the company does not currently provide and that","page_number":208,"box":{"x":69,"y":45,"width":798,"height":11}},{"id":"aa0f2842-f6de-413c-88bd-09feee354fb8","block_type":"box","text":"would be helpful to investment decision-making. We would not recommend suppor t for shareholder proposals that","page_number":208,"box":{"x":68,"y":59,"width":814,"height":12}},{"id":"23e0d8c3-27c2-4dcc-b1e2-f974fc420237","block_type":"box","text":"seek to constrain board or management decision-making or direct specific business or strategic decisions. As under","page_number":208,"box":{"x":69,"y":74,"width":828,"height":12}},{"id":"f3af032e-c3f1-479f-bc6e-d09843f5c128","block_type":"box","text":"the BAIS benchmark approach, the active por tfolio managers are ultimately responsible for voting consistent with","page_number":208,"box":{"x":68,"y":89,"width":807,"height":12}},{"id":"f4fca3cb-90f8-4ad2-b3d8-2f864f562ff0","block_type":"box","text":"their investment mandate and fund objectives. For the funds and accounts in scope, voting on matters not related to","page_number":208,"box":{"x":68,"y":104,"width":832,"height":11}},{"id":"4f29b171-124a-42e6-87e5-95373df9a424","block_type":"box","text":"climate risk and the energy transition is under taken in line with BAIS’ benchmark guidelines.","page_number":208,"box":{"x":69,"y":119,"width":658,"height":11}},{"id":"d7e3acd0-857c-406c-9996-9514c3a1eeb8","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":208,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"7916a56d-cd25-4eb4-8477-c86aea5064eb","block_type":"box","text":"Global Engagement and Voting Guidelines | 13","page_number":208,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"ef57f1c3-bca0-459c-8fb4-2f56b0702b46","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":208,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"4cd54df7-8e81-4fb2-aad3-c93b31267106","block_type":"box","text":"APPENDIX 1: HOW WE FULFILL AND OVERSEE OUR INVESTMENT STEWARDSHIP RESPONSIBILITIES FOR NON","page_number":209,"box":{"x":83,"y":45,"width":812,"height":9}},{"id":"2495c0d9-f45b-49ef-8142-2bd38e9a7e72","block_type":"box","text":"INDEX EQUITY INVESTMENT STRATEGIES","page_number":209,"box":{"x":338,"y":60,"width":302,"height":10}},{"id":"acad82a8-420f-49a4-ab4f-8b17b1729cab","block_type":"box","text":"Oversight","page_number":209,"box":{"x":69,"y":83,"width":68,"height":11}},{"id":"ac000f5d-5851-46a3-a478-f9f41a198736","block_type":"box","text":"The Global Head of BAIS has primary oversight of and responsibility for the team’s activities, including voting in","page_number":209,"box":{"x":101,"y":101,"width":793,"height":11}},{"id":"63b9be38-bd89-493a-9b8b-4bd150c3ec14","block_type":"box","text":"accordance with the BlackRock Active Investment Stewardship Global Engagement and Voting Guidelines (the","page_number":209,"box":{"x":69,"y":116,"width":778,"height":11}},{"id":"250b5afe-108c-4433-a771-47bb52369265","block_type":"box","text":"“Guidelines”), which require the application of professional judgment and consideration of each company’s unique","page_number":209,"box":{"x":70,"y":131,"width":814,"height":11}},{"id":"c962915d-c2c1-4b3e-8db3-009fe4d970e3","block_type":"box","text":"circumstances, as well as input from active investors. BAIS is independent from BlackRock Investment Stewardship","page_number":209,"box":{"x":69,"y":146,"width":825,"height":11}},{"id":"e0e36005-07bb-49f3-a8c5-7141a6bc1f77","block_type":"box","text":"in our engagement and voting activities, repor ting lines, and oversight.","page_number":209,"box":{"x":70,"y":161,"width":500,"height":11}},{"id":"de4de27f-3a2e-4e2f-a8a0-4f555381e928","block_type":"box","text":"The Stewardship Leaders Group, comprised of senior active investors and other relevant stakeholders in","page_number":209,"box":{"x":101,"y":179,"width":744,"height":11}},{"id":"a709c661-dac0-4117-b556-d21e337ef58d","block_type":"box","text":"BlackRock’s legal, public policy, sustainability and communications teams, helps shape the firm’s approach to","page_number":209,"box":{"x":70,"y":194,"width":786,"height":11}},{"id":"08ee798f-6fd2-4d8c-b1f6-293a58170f00","block_type":"box","text":"investment stewardship on non-index equity investment strategies. The Group may advise on and review amendments","page_number":209,"box":{"x":70,"y":209,"width":839,"height":11}},{"id":"93503fcc-bd03-4463-9dcb-ca5967ea62fc","block_type":"box","text":"to BAIS’ policies and practices. It does not determine voting decisions, which are the responsibility of BAIS and the","page_number":209,"box":{"x":68,"y":224,"width":822,"height":11}},{"id":"6130ed8e-4fc4-4f9a-a3ba-cf7d3d61d8ad","block_type":"box","text":"relevant active equity investors.","page_number":209,"box":{"x":69,"y":239,"width":223,"height":11}},{"id":"9033e8c3-7c3c-4482-881c-a0d64d5323a8","block_type":"box","text":"BAIS carries out engagement with companies in collaboration with active investment colleagues, executes proxy","page_number":209,"box":{"x":102,"y":257,"width":797,"height":12}},{"id":"cce449da-ed57-4d3f-9a9c-236fa77ae9ef","block_type":"box","text":"votes, and conducts vote operations (including maintaining records of votes cast) in a manner consistent with the","page_number":209,"box":{"x":68,"y":272,"width":810,"height":11}},{"id":"7eef9bbc-4702-4bbc-9baa-5dca553487ca","block_type":"box","text":"Guidelines. BAIS also conducts research on corporate governance issues and par ticipates in industry discussions to","page_number":209,"box":{"x":69,"y":287,"width":832,"height":11}},{"id":"d7c80b0c-8c15-487a-a23d-91481da4d24c","block_type":"box","text":"contribute to and keep abreast of impor tant developments in the corporate governance field. BAIS may use third","page_number":209,"box":{"x":69,"y":302,"width":801,"height":11}},{"id":"4bedbef7-e648-4606-95ab-a3328e8893a8","block_type":"box","text":"par ties for cer tain of the foregoing activities and per forms oversight of those third par ties (see “Use and oversight of","page_number":209,"box":{"x":70,"y":317,"width":836,"height":11}},{"id":"574ee1e5-ec2e-471f-8272-b61269ec8043","block_type":"box","text":"third-par ty vote services providers” below).","page_number":209,"box":{"x":68,"y":332,"width":305,"height":11}},{"id":"15aed220-5e4c-4576-a7ab-bc4d9b8a927b","block_type":"box","text":"Voting guidelines and vote execution","page_number":209,"box":{"x":68,"y":354,"width":269,"height":11}},{"id":"f509410f-f6bf-40d7-a57a-0e00a76526fe","block_type":"box","text":"BlackRock votes on proxy issues when our clients authorize us to do so. We carefully consider the voting items","page_number":209,"box":{"x":102,"y":373,"width":790,"height":11}},{"id":"a3e1dfc2-4b4e-4883-8852-ff73486c32bc","block_type":"box","text":"submitted to funds and other fiduciary account(s) (Fund or Funds) for which we have voting authority. BlackRock votes","page_number":209,"box":{"x":69,"y":387,"width":838,"height":12}},{"id":"c3836e36-384d-4932-a01e-34dbb5e2d485","block_type":"box","text":"(or refrains from voting) for each Fund for which we have voting authority based on our evaluation of the alignment of","page_number":209,"box":{"x":69,"y":402,"width":831,"height":12}},{"id":"89ee79ab-07b6-4f26-a03b-49758ac37282","block_type":"box","text":"the voting items with the long-term economic interests of our clients, in the exercise of our independent business","page_number":209,"box":{"x":68,"y":417,"width":809,"height":12}},{"id":"e4f9778f-b0d3-4c8a-a286-39e14f201a71","block_type":"box","text":"judgment, and without regard to the relationship of the issuer (or any shareholder proponent or dissident","page_number":209,"box":{"x":67,"y":432,"width":749,"height":11}},{"id":"d319016d-2c95-4f9d-a885-e01073cc6458","block_type":"box","text":"shareholder) to the Fund, the Fund’s affiliates (if any), BlackRock or BlackRock’s affiliates, or BlackRock employees","page_number":209,"box":{"x":69,"y":447,"width":825,"height":11}},{"id":"dbf799e1-5f89-4c45-9ace-417ce70e52e1","block_type":"box","text":"(see “Conflicts management policies and procedures,” below).","page_number":209,"box":{"x":69,"y":462,"width":445,"height":11}},{"id":"d9601faa-4d5d-42be-a261-10e81e69d146","block_type":"box","text":"When exercising voting rights, BAIS will normally vote on specific proxy issues in accordance with the Guidelines,","page_number":209,"box":{"x":101,"y":480,"width":803,"height":12}},{"id":"ee565e80-0665-4874-a166-1ce5345c02ae","block_type":"box","text":"although por tfolio managers have the right to vote differently on their holdings if they determine doing so is more","page_number":209,"box":{"x":69,"y":495,"width":806,"height":12}},{"id":"3ac2bcc4-3af5-4e23-8a5a-03e978e3da0e","block_type":"box","text":"aligned with the investment objective and financial interests of clients invested in the funds they manage.","page_number":209,"box":{"x":69,"y":510,"width":752,"height":11}},{"id":"fddee865-14d5-42a3-843e-2bd4901d795b","block_type":"box","text":"The Guidelines are not intended to be exhaustive. BAIS applies the Guidelines on a case-by-case basis, in the","page_number":209,"box":{"x":101,"y":529,"width":782,"height":11}},{"id":"b3a0c469-f1aa-42a1-a9b4-057861518ecb","block_type":"box","text":"context of the individual circumstances of each company and the specific issue under review. As such, the Guidelines","page_number":209,"box":{"x":69,"y":544,"width":837,"height":11}},{"id":"afdf960b-e98f-46a3-897f-2e7c909d7ae3","block_type":"box","text":"do not indicate how BAIS will vote in every instance. Rather, they reflect our view about corporate governance issues","page_number":209,"box":{"x":69,"y":559,"width":830,"height":11}},{"id":"b8e56a06-4f53-4522-a358-3ffc09662204","block_type":"box","text":"generally, and provide insight into how we typically approach issues that are commonly put to a shareholder vote. The","page_number":209,"box":{"x":68,"y":574,"width":838,"height":11}},{"id":"f082b36a-47b2-4bc6-a3f6-60338354929d","block_type":"box","text":"Guidelines are reviewed annually and updated as necessary to reflect changes in market practices, developments in","page_number":209,"box":{"x":69,"y":588,"width":829,"height":12}},{"id":"fca081e9-16ae-47a5-ae7d-070b98ed97c4","block_type":"box","text":"corporate governance and feedback from companies and clients. In this way, BAIS aims to maintain policies that","page_number":209,"box":{"x":69,"y":603,"width":802,"height":11}},{"id":"8387b291-7d3d-469c-bb37-17728df2907e","block_type":"box","text":"explain our approach to governance practices most aligned with clients’ long-term financial interests.","page_number":209,"box":{"x":69,"y":618,"width":718,"height":11}},{"id":"c86197cd-1d9c-478e-9f0b-072cd1052f17","block_type":"box","text":"In cer tain markets, proxy voting involves logistical issues which can affect BAIS’ ability to vote such proxies, as","page_number":209,"box":{"x":102,"y":637,"width":792,"height":11}},{"id":"2e41dbd5-1626-4ad5-beea-ce879131026d","block_type":"box","text":"well as the desirability of voting such proxies. 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We are not suppor tive of impediments to the","page_number":209,"box":{"x":70,"y":726,"width":806,"height":11}},{"id":"0ae93079-a698-449b-b33d-804105372db1","block_type":"box","text":"exercise of voting rights such as share-blocking or overly burdensome administrative requirements.","page_number":209,"box":{"x":69,"y":741,"width":704,"height":11}},{"id":"0f3e5bd6-5f5b-4478-9eaa-5c704d2b52c2","block_type":"box","text":"BlackRock votes proxies in these situations on a “best-effor ts” basis. 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In addition, institutional clients in","page_number":210,"box":{"x":70,"y":60,"width":834,"height":11}},{"id":"7d598b7c-c171-4352-9a5a-3feaf884e466","block_type":"box","text":"separately managed accounts (SMAs) are eligible for BlackRock Voting Choice regardless of their investment","page_number":210,"box":{"x":69,"y":74,"width":774,"height":12}},{"id":"b056cf95-e482-4f92-9dfc-c785e672eab3","block_type":"box","text":"strategies.","page_number":210,"box":{"x":69,"y":89,"width":74,"height":12}},{"id":"a7276e58-2015-4577-863d-0c456e7bcd8c","block_type":"box","text":"12","page_number":210,"box":{"x":145,"y":90,"width":9,"height":4}},{"id":"c1e22f2e-0fbe-4660-8f07-f5f8765a9196","block_type":"box","text":"As a result, the shares attributed to BlackRock in company share registers may be voted differently depending","page_number":210,"box":{"x":101,"y":108,"width":788,"height":11}},{"id":"a8c25ab7-826e-43b3-a315-219e0801c77b","block_type":"box","text":"on whether our clients have authorized BAIS to vote on their behalf, have authorized BlackRock to vote in accordance","page_number":210,"box":{"x":69,"y":123,"width":834,"height":10}},{"id":"894a6d69-4656-439c-ae83-aa1cf8aafdca","block_type":"box","text":"with a third-par ty policy, or have elected to vote shares in accordance with their own policy. Our clients have greater","page_number":210,"box":{"x":68,"y":138,"width":823,"height":11}},{"id":"a1fd0628-6aa0-4289-8a97-a4e268a51b5f","block_type":"box","text":"control over proxy voting because of Voting Choice.","page_number":210,"box":{"x":69,"y":152,"width":360,"height":12}},{"id":"93a7c459-3c14-4c9f-9b10-b5ea2a10edb1","block_type":"box","text":"13","page_number":210,"box":{"x":431,"y":153,"width":9,"height":4}},{"id":"f907cb7b-b88d-4294-a88c-e4bea08cc4df","block_type":"box","text":"Use and oversight of third-party vote services providers","page_number":210,"box":{"x":69,"y":175,"width":403,"height":11}},{"id":"c0aca369-f73a-491f-948f-fee5e31dd226","block_type":"box","text":"Third-par ty vote services providers – or proxy research firms – provide research and recommendations on proxy","page_number":210,"box":{"x":101,"y":193,"width":794,"height":12}},{"id":"198bf05f-76d4-46ea-87ad-62cd20070127","block_type":"box","text":"votes, as well as voting infrastructure. BlackRock contracts primarily with the vote services provider ISS and","page_number":210,"box":{"x":68,"y":208,"width":770,"height":12}},{"id":"566dffa1-9b59-4efe-822a-5ad98c95ffd2","block_type":"box","text":"leverages its online platform to supply research and suppor t voting, record keeping, and repor ting processes. We","page_number":210,"box":{"x":70,"y":223,"width":807,"height":12}},{"id":"62c2a040-3f7e-49cc-8a5f-bb7f70e26c2f","block_type":"box","text":"also use Glass Lewis’ research and analysis as an input into our voting process. It is impor tant to note that, although","page_number":210,"box":{"x":69,"y":238,"width":839,"height":11}},{"id":"4a6f8ac5-b1b6-4075-970c-2e6398e6e482","block_type":"box","text":"proxy research firms provide impor tant data and analysis, BAIS does not rely solely on their information or follow their","page_number":210,"box":{"x":70,"y":253,"width":839,"height":11}},{"id":"75aafba6-e0c7-469f-9bb6-8e3b88dbd177","block_type":"box","text":"voting recommendations. A company’s disclosures, our engagements and voting, investment colleagues’ insights and","page_number":210,"box":{"x":68,"y":268,"width":840,"height":11}},{"id":"b9f3e912-614e-42d9-934f-49c9396ca18e","block_type":"box","text":"our Guidelines are impor tant inputs into our voting decisions on behalf of clients.","page_number":210,"box":{"x":69,"y":283,"width":578,"height":11}},{"id":"f49449ec-3f3e-4021-b320-691a6e9e6672","block_type":"box","text":"Given the large universe of actively held companies, BAIS employs the proxy services provider to streamline the","page_number":210,"box":{"x":102,"y":301,"width":795,"height":12}},{"id":"e31bf9de-5918-4605-87ee-3cee655f9c00","block_type":"box","text":"voting process by making voting recommendations based on BAIS’ Guidelines when the items on a shareholder","page_number":210,"box":{"x":68,"y":316,"width":795,"height":12}},{"id":"3973d8ba-53c9-4551-a748-9ba27d1ba9b4","block_type":"box","text":"meeting agenda are routine. Agenda items that are not routine are referred back to BAIS to assess, escalate as","page_number":210,"box":{"x":69,"y":331,"width":799,"height":11}},{"id":"f1c300d4-8733-42e8-9a07-13248702b0ef","block_type":"box","text":"necessary to the relevant por tfolio managers and vote. BAIS reviews and can override the recommendations of the","page_number":210,"box":{"x":69,"y":346,"width":819,"height":11}},{"id":"5c04cbd2-d686-4d93-8e97-fbd29737619d","block_type":"box","text":"vote services provider at any time prior to the vote deadline. Both BAIS and the vote services provider actively","page_number":210,"box":{"x":68,"y":361,"width":785,"height":11}},{"id":"d966ea17-d4c2-4837-bd39-d362127933e0","block_type":"box","text":"monitor securities filings, research repor ts, company announcements, and direct communications from companies to","page_number":210,"box":{"x":69,"y":376,"width":837,"height":11}},{"id":"398371ed-2d6a-4a21-9998-7e35e23b3f8e","block_type":"box","text":"ensure awareness of supplemental disclosures and proxy materials that may require a modification of votes.","page_number":210,"box":{"x":69,"y":390,"width":775,"height":12}},{"id":"9171af35-2b69-426f-8c29-cfaba1643f1f","block_type":"box","text":"BAIS closely monitors the third-par ty vote services providers we contract with to ensure that they are meeting our","page_number":210,"box":{"x":102,"y":409,"width":807,"height":11}},{"id":"b3985600-08f4-4725-8d18-94b5832872f9","block_type":"box","text":"service level expectations and have effective policies and procedures in place to manage potential conflicts of","page_number":210,"box":{"x":69,"y":424,"width":788,"height":11}},{"id":"da7f7746-1dbe-43ae-8bb3-b2b1cb809d8d","block_type":"box","text":"interest. 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BlackRock","page_number":210,"box":{"x":102,"y":639,"width":767,"height":11}},{"id":"fe33b571-934b-4ef6-b042-c3d0a7377f0d","block_type":"box","text":"•","page_number":210,"box":{"x":69,"y":659,"width":6,"height":5}},{"id":"bbd6dc88-d3b7-4145-b9f1-82aa08665ccf","block_type":"box","text":"Securities of BlackRock, Inc. or BlackRock investment funds held in Funds managed by BlackRock","page_number":210,"box":{"x":102,"y":656,"width":698,"height":11}},{"id":"1d994d58-999f-42df-a9b6-18359e571564","block_type":"box","text":"•","page_number":210,"box":{"x":69,"y":676,"width":6,"height":5}},{"id":"d09011d0-40b1-44cd-ab30-9c0449d4f507","block_type":"box","text":"BlackRock, Inc. board members who serve as senior executives or directors of public companies held in Funds","page_number":210,"box":{"x":102,"y":673,"width":789,"height":11}},{"id":"b9693ab2-cbda-4194-9993-a96687439158","block_type":"box","text":"managed by BlackRock","page_number":210,"box":{"x":102,"y":689,"width":163,"height":11}},{"id":"714396ac-6208-41bc-876b-24418c3e0a8e","block_type":"box","text":"BlackRock has taken cer tain steps to mitigate perceived or potential conflicts including, but not limited to, the","page_number":210,"box":{"x":102,"y":707,"width":785,"height":11}},{"id":"ec813152-cfb2-4f8c-8379-92e3c23306e2","block_type":"box","text":"following:","page_number":210,"box":{"x":68,"y":722,"width":66,"height":11}},{"id":"aad14bd8-7c09-4e85-8426-2151018182e2","block_type":"box","text":"•","page_number":210,"box":{"x":69,"y":742,"width":6,"height":5}},{"id":"bbad0597-cc46-4534-a4cf-6451eca4c6a8","block_type":"box","text":"Adopted these Guidelines which are designed to advance our clients’ long-term financial interests in the","page_number":210,"box":{"x":101,"y":739,"width":741,"height":11}},{"id":"8349d3d6-1651-470e-96b4-3e2e71bd49ab","block_type":"box","text":"companies in which BlackRock invests on their behalf","page_number":210,"box":{"x":101,"y":754,"width":383,"height":11}},{"id":"17e2d902-883a-4a83-b571-c1dfcdfb22e6","block_type":"box","text":"•","page_number":210,"box":{"x":69,"y":774,"width":6,"height":5}},{"id":"85252a61-b726-4569-8898-0ef9591a6287","block_type":"box","text":"Established a repor ting structure that separates BAIS from employees with sales, vendor management, or","page_number":210,"box":{"x":102,"y":771,"width":757,"height":12}},{"id":"f255c18f-4324-4fd4-8b79-fb046c3b2e17","block_type":"box","text":"business par tnership roles. 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The Guidelines set for th BlackRock’s approach to recalling securities on loan in","page_number":213,"box":{"x":102,"y":725,"width":778,"height":11}},{"id":"20c0415d-d21a-4be7-a006-dd76f506976d","block_type":"box","text":"connection with proxy voting.","page_number":213,"box":{"x":101,"y":740,"width":203,"height":11}},{"id":"5337afe6-ee7d-4703-8902-1126b6d9c281","block_type":"box","text":"Reports to the Board","page_number":213,"box":{"x":102,"y":758,"width":153,"height":11}},{"id":"8929e927-f13c-460d-b9c4-aa57db0e0bc8","block_type":"box","text":"BlackRock will repor t on an annual basis to the Directors on (1) a summary of the proxy voting process as","page_number":213,"box":{"x":135,"y":777,"width":755,"height":11}},{"id":"a814f4a6-6482-4098-a171-f522a8232d9c","block_type":"box","text":"applicable to the Funds covered by this policy in the preceding year together with a representation that all 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Reporting on our activities to inform clients","page_number":217,"box":{"x":69,"y":292,"width":351,"height":11}},{"id":"0a0c35f7-795d-4295-b46e-41f25b9a9023","block_type":"box","text":"about our stewardship effor ts on their behalf through a range of","page_number":217,"box":{"x":426,"y":292,"width":457,"height":11}},{"id":"d8961d08-32e7-4285-b15a-4c3ef79c2e43","block_type":"box","text":"publications on our website and direct client communications.","page_number":217,"box":{"x":102,"y":307,"width":439,"height":11}},{"id":"21aab420-5ebc-4a11-8244-bd02c294f522","block_type":"box","text":"This document provides an overarching explanation of the principles that guide our approach to engaging and","page_number":217,"box":{"x":101,"y":329,"width":778,"height":12}},{"id":"53de843d-e044-4339-a420-e6a9f92cca7d","block_type":"box","text":"voting on corporate governance matters and other material risks and oppor tunities under BIS’ Benchmark Policies.","page_number":217,"box":{"x":68,"y":345,"width":817,"height":11}},{"id":"aadbc502-d59c-4834-84ca-50e88ffdae82","block_type":"box","text":"The BIS Benchmark Policies – which are comprised of the BIS Global Principles, regional voting guidelines, and","page_number":217,"box":{"x":68,"y":360,"width":790,"height":11}},{"id":"d93a1918-87d0-43a8-9550-b40afb329636","block_type":"box","text":"Engagement Priorities – apply to clients’ assets invested through index equity strategies, take a financial materiality","page_number":217,"box":{"x":70,"y":375,"width":829,"height":11}},{"id":"ea779572-b6ac-44df-8a35-a5ea73f37f88","block_type":"box","text":"based approach, and are focused solely on advancing clients’ long-term financial interests.","page_number":217,"box":{"x":69,"y":390,"width":648,"height":11}},{"id":"bdabd71c-2894-499b-810b-c68b374ead05","block_type":"box","text":"2","page_number":217,"box":{"x":718,"y":390,"width":4,"height":5}},{"id":"e3bca687-2384-42e4-b643-5276d17949b9","block_type":"box","text":"PHILOSOPHY ON INVESTMENT STEWARDSHIP","page_number":217,"box":{"x":321,"y":420,"width":337,"height":9}},{"id":"00760cfb-73d0-48a8-9668-80f04d638027","block_type":"box","text":"Sound governance is critical to a company’s ability to create long-term financial value. 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These are topics that shareholders may have","page_number":218,"box":{"x":69,"y":475,"width":822,"height":12}},{"id":"8fc26b82-0af7-4853-86e2-0641699201e3","block_type":"box","text":"the ability to vote on at shareholder meetings. 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Our regional voting guidelines explain how the BIS Global","page_number":218,"box":{"x":69,"y":717,"width":781,"height":12}},{"id":"6dfb4829-9472-4658-a570-6230d3cbe83b","block_type":"box","text":"Principles inform our voting decisions in relation to common ballot items for shareholder meetings in those markets.","page_number":218,"box":{"x":69,"y":732,"width":829,"height":12}},{"id":"c9a49dbb-9908-477a-8906-0e8193b713fc","block_type":"box","text":"4","page_number":218,"box":{"x":899,"y":733,"width":5,"height":4}},{"id":"e765b77b-707c-40f6-b594-c0c24046814f","block_type":"box","text":"3","page_number":218,"box":{"x":69,"y":762,"width":4,"height":5}},{"id":"c337beb1-6d09-4490-9966-8319c455346f","block_type":"box","text":"Examples include: Government of Canada, “Canada Business Corporations Act,” amended 2024; European Union,","page_number":218,"box":{"x":79,"y":762,"width":816,"height":11}},{"id":"31d77742-ffcc-48cb-aec8-4826dec8fac2","block_type":"box","text":"“Shareholder Rights Directive II,” 2017; and the China Securities Regulatory Commission, “Code of Corporate","page_number":218,"box":{"x":70,"y":777,"width":784,"height":11}},{"id":"3535c6c4-3bc2-47ad-bc9b-f3e8ce4da567","block_type":"box","text":"Governance for Listed Companies in China,” 2001. Websites accessed in December 2025.","page_number":218,"box":{"x":69,"y":792,"width":650,"height":11}},{"id":"ffdff4f9-42db-4ec4-bae4-0079e5eaf64a","block_type":"box","text":"4","page_number":218,"box":{"x":69,"y":810,"width":4,"height":4}},{"id":"f91e5d5b-6e96-4d51-aebe-86f62d1ed9fa","block_type":"box","text":"Our regional voting guidelines reflect these different market standards and norms. Depending on the market,","page_number":218,"box":{"x":79,"y":810,"width":776,"height":11}},{"id":"2144b856-8580-4a75-a0ef-28c39edf5270","block_type":"box","text":"generally accepted practice is informed by corporate law, market regulation, best practices, and industry initiatives,","page_number":218,"box":{"x":68,"y":825,"width":821,"height":11}},{"id":"718272b4-c9c1-4ea0-a738-bc73124019ee","block_type":"box","text":"amongst other factors. BIS carries out engagement with companies, executes proxy votes, and conducts vote","page_number":218,"box":{"x":69,"y":840,"width":780,"height":11}},{"id":"e0227b93-0555-4dcb-ba9c-3f865eb75078","block_type":"box","text":"operations (including maintaining records of votes cast) in a manner consistent with the relevant regional voting","page_number":218,"box":{"x":69,"y":855,"width":796,"height":11}},{"id":"c52b7df2-eda3-45e6-8e9e-73b30b62c938","block_type":"box","text":"guidelines.","page_number":218,"box":{"x":68,"y":870,"width":76,"height":11}},{"id":"20a71138-5712-4d33-8e83-36a45afb998b","block_type":"box","text":"BlackRock Investment Stewardship","page_number":218,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"eb574068-e3fc-401b-a953-089ce2694bd9","block_type":"box","text":"Global Principles | 4","page_number":218,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"b1d0a4eb-c855-4551-95df-0aa5a30892d6","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":218,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"f832c816-2ba1-41fc-a238-fe0c8892b682","block_type":"box","text":"BOARDS AND DIRECTORS","page_number":219,"box":{"x":394,"y":45,"width":190,"height":9}},{"id":"d769a6b6-f8af-4b0a-a150-0e227287c21f","block_type":"box","text":"Oversight role of the board","page_number":219,"box":{"x":69,"y":75,"width":194,"height":11}},{"id":"3c60b380-cd93-4c5b-beaf-e36b4a80243f","block_type":"box","text":"Companies whose boards are comprised of appropriately qualified, engaged directors with professional","page_number":219,"box":{"x":102,"y":98,"width":734,"height":11}},{"id":"60ec94c2-1a67-4c58-b83d-8c320b827582","block_type":"box","text":"characteristics relevant to a company’s business enhance the board’s ability to add long-term financial value and","page_number":219,"box":{"x":69,"y":113,"width":806,"height":11}},{"id":"e4cabfdc-2152-4a10-8a42-052e5efb66e3","block_type":"box","text":"serve as the voice of shareholders in board discussions. In our view, a strong board gives a company a competitive","page_number":219,"box":{"x":69,"y":128,"width":822,"height":11}},{"id":"2574ee24-0403-4662-8e53-abd279b36c34","block_type":"box","text":"advantage, providing valuable oversight and contributing to the most impor tant management decisions that suppor t","page_number":219,"box":{"x":69,"y":143,"width":825,"height":11}},{"id":"8946c344-88d3-4cf7-8f0b-98ae8b4490c5","block_type":"box","text":"long-term financial per formance.","page_number":219,"box":{"x":70,"y":158,"width":229,"height":11}},{"id":"e6034114-4e26-40cf-82c9-4296829853de","block_type":"box","text":"For this reason, our investment stewardship effor ts focus on the effectiveness of the board of directors. We","page_number":219,"box":{"x":102,"y":181,"width":771,"height":11}},{"id":"3a073203-cd4a-43ef-a254-f590325ffe79","block_type":"box","text":"engage, as necessary, with members of the board’s nominating and/or governance committee to assess whether","page_number":219,"box":{"x":69,"y":196,"width":811,"height":11}},{"id":"dca41e5e-862d-46c9-a5ec-64451b1492b3","block_type":"box","text":"governance practices and board composition are effective given a company’s business model, sector, market, and","page_number":219,"box":{"x":68,"y":211,"width":817,"height":11}},{"id":"9d03568d-7840-414c-9417-0040840dc320","block_type":"box","text":"the business environment in which a company is operating.","page_number":219,"box":{"x":68,"y":226,"width":422,"height":11}},{"id":"e2808acd-0668-491a-a08c-ccb07eeb5666","block_type":"box","text":"We consider it good practice when the board establishes and maintains a framework of robust and effective","page_number":219,"box":{"x":101,"y":249,"width":770,"height":11}},{"id":"8f230a77-9d51-47c6-9ad3-f6059f7280b1","block_type":"box","text":"governance mechanisms that suppor ts its oversight of the company’s strategy and operations, consistent with the","page_number":219,"box":{"x":68,"y":264,"width":817,"height":11}},{"id":"582e5fba-74d6-4829-8eba-01981e9ce2f6","block_type":"box","text":"long-term financial interests of investors. This includes having clear descriptions of the role of the board and the","page_number":219,"box":{"x":70,"y":279,"width":799,"height":11}},{"id":"74539075-5717-4a7c-9ddf-48586b6bae65","block_type":"box","text":"committees of the board and how directors engage with and oversee management, as well as disclosure of material","page_number":219,"box":{"x":69,"y":294,"width":827,"height":11}},{"id":"1e520e0f-6cec-49c6-83a6-c40392a3be21","block_type":"box","text":"risks that may affect a company’s long-term strategy and how management is effectively identifying, managing, and","page_number":219,"box":{"x":69,"y":309,"width":822,"height":11}},{"id":"4c05aace-13d9-419b-b448-1b9f82c665d6","block_type":"box","text":"mitigating such risks.","page_number":219,"box":{"x":69,"y":325,"width":150,"height":11}},{"id":"86171513-2861-4331-a540-9556c73d955a","block_type":"box","text":"Understanding management’s long-term strategy and the milestones against which investors should assess its","page_number":219,"box":{"x":102,"y":347,"width":791,"height":11}},{"id":"c85d9a07-44c4-45c1-9877-bed019869b03","block_type":"box","text":"implementation is central to our approach. If any strategic targets are significantly missed or materially restated, we","page_number":219,"box":{"x":70,"y":362,"width":826,"height":11}},{"id":"2fd7966b-ae09-4b59-bf8a-3759a3e76fe6","block_type":"box","text":"find it helpful when company disclosures provide a detailed explanation of the changes and an indication of the","page_number":219,"box":{"x":68,"y":377,"width":793,"height":12}},{"id":"cff4662d-74cb-4f10-9ee2-2a98b689fffc","block_type":"box","text":"board’s role in reviewing the revised targets. We look to the board to ar ticulate the effectiveness of these","page_number":219,"box":{"x":69,"y":392,"width":755,"height":12}},{"id":"4b36ea08-a565-4711-9959-15c54362cbb9","block_type":"box","text":"mechanisms in overseeing the management of business risks and oppor tunities and the fulfillment of the company’s","page_number":219,"box":{"x":69,"y":407,"width":835,"height":12}},{"id":"ca783473-dc2d-4fa1-ba4d-24f80fa0511e","block_type":"box","text":"strategy.","page_number":219,"box":{"x":69,"y":423,"width":58,"height":11}},{"id":"c50fd286-2f3b-4b95-ad09-f483c0174f7d","block_type":"box","text":"Where a company has not adequately disclosed or demonstrated that its board has fulfilled these corporate","page_number":219,"box":{"x":101,"y":445,"width":769,"height":11}},{"id":"dcf83120-d0a8-4d07-8291-80e63b21a2ad","block_type":"box","text":"governance and risk oversight responsibilities, we may consider not suppor ting the election of directors who, in our","page_number":219,"box":{"x":68,"y":460,"width":823,"height":12}},{"id":"7253388e-b907-4aa6-a3a2-1e6f3154a165","block_type":"box","text":"assessment, have par ticular responsibility for the issues.","page_number":219,"box":{"x":69,"y":475,"width":409,"height":12}},{"id":"30105574-4b0f-44d2-bf0b-d59e57d57613","block_type":"box","text":"When casting vote decisions on behalf of clients on the election of directors, some of the factors that speak to","page_number":219,"box":{"x":101,"y":498,"width":791,"height":11}},{"id":"65bc12ab-a391-4c84-b67d-60cde10ee496","block_type":"box","text":"the board’s effectiveness as a group include the relevance of individual directors’ qualifications and skillsets, as well","page_number":219,"box":{"x":68,"y":513,"width":836,"height":12}},{"id":"b61ef84e-f704-451f-9406-f8c1766da93e","block_type":"box","text":"as directors’ capacity and other time commitments, and how these factors may contribute to the company’s financial","page_number":219,"box":{"x":69,"y":528,"width":833,"height":12}},{"id":"c9cb70ec-4358-426d-b38e-d3fe00fa03b9","block_type":"box","text":"per formance. We look to boards to establish formal and transparent processes for nominating directors that reflect","page_number":219,"box":{"x":70,"y":543,"width":823,"height":12}},{"id":"a6682157-ba14-4014-8154-a6ba28b6a252","block_type":"box","text":"the company’s long-term strategy and business model.","page_number":219,"box":{"x":68,"y":559,"width":390,"height":11}},{"id":"822f30ea-48d2-4b25-bd30-0f323fa77579","block_type":"box","text":"In the section titled “Board quality and effectiveness” below, we provide more detail about our approach to board","page_number":219,"box":{"x":102,"y":581,"width":807,"height":11}},{"id":"eceae839-8684-44f5-89aa-2b431b2dfa69","block_type":"box","text":"composition and how it underpins board effectiveness and long-term financial value creation.","page_number":219,"box":{"x":69,"y":596,"width":662,"height":12}},{"id":"fd1b644e-5be1-4b16-a6c8-7054aa906805","block_type":"box","text":"Regular accountability through director elections","page_number":219,"box":{"x":69,"y":627,"width":358,"height":11}},{"id":"35d6447c-dcc9-4eec-8cdf-57498429fdac","block_type":"box","text":"The election of directors to the board is a right of shareholders and an impor tant signal of suppor t for, or","page_number":219,"box":{"x":101,"y":649,"width":750,"height":12}},{"id":"262f7e82-0735-4467-9fc5-4b1053337ac6","block_type":"box","text":"concern about, the per formance of the board in overseeing and advising management. To ensure accountability for","page_number":219,"box":{"x":69,"y":664,"width":819,"height":12}},{"id":"fb1dd92e-9603-4e5c-9ebe-82b4baf04544","block_type":"box","text":"their decisions on behalf of shareholders, directors should stand for election on a regular basis, ideally annually.","page_number":219,"box":{"x":68,"y":680,"width":802,"height":11}},{"id":"d76d3b16-68d7-42e0-8dd6-455373493244","block_type":"box","text":"5","page_number":219,"box":{"x":872,"y":680,"width":4,"height":4}},{"id":"8dfad20f-ac9a-4fe1-8648-b0d549706712","block_type":"box","text":"Annual director elections allow shareholders to reaffirm their suppor t for, or concerns about, board members’","page_number":219,"box":{"x":68,"y":695,"width":782,"height":11}},{"id":"15535393-6ffb-4b7f-8384-998e4f291408","block_type":"box","text":"decisions in a timely manner. When board members are not elected annually, we consider it good practice for boards","page_number":219,"box":{"x":69,"y":710,"width":832,"height":11}},{"id":"7267f7d9-f580-4c1c-a92d-fb3560540627","block_type":"box","text":"to have a rotation policy to ensure that, through a board cycle, all directors have had their appointment re-confirmed,","page_number":219,"box":{"x":68,"y":725,"width":832,"height":11}},{"id":"e950b091-ac17-43c2-ab6a-83f940e25171","block_type":"box","text":"with a propor tion of directors being put forward for election at each shareholder meeting.","page_number":219,"box":{"x":68,"y":740,"width":636,"height":11}},{"id":"194c2e58-c2b6-4ae1-b401-693d1dafb163","block_type":"box","text":"BOARD QUALITY AND EFFECTIVENESS","page_number":219,"box":{"x":348,"y":770,"width":282,"height":11}},{"id":"113b2e9c-0f72-40c8-9e85-0704a18ce776","block_type":"box","text":"Regular director elections also give boards the oppor tunity to adjust their composition in an orderly way to reflect","page_number":219,"box":{"x":102,"y":793,"width":805,"height":11}},{"id":"cef38758-4a0a-44b2-92d8-557f5dd49549","block_type":"box","text":"developments in the company’s strategy and the market environment. In our view, it is beneficial for new directors to","page_number":219,"box":{"x":69,"y":808,"width":831,"height":11}},{"id":"74455bba-e6be-41c2-99ec-a5b522e182fb","block_type":"box","text":"be brought onto the board periodically to refresh the group’s thinking, while suppor ting both continuity and","page_number":219,"box":{"x":69,"y":823,"width":758,"height":12}},{"id":"ab751401-512c-4c7f-a6d3-80cd81a791be","block_type":"box","text":"5","page_number":219,"box":{"x":69,"y":853,"width":4,"height":4}},{"id":"26832ee6-8153-4e69-899c-15c4cd30c270","block_type":"box","text":"In most markets, directors stand for re-election on an annual or triennial basis, as determined by corporate law,","page_number":219,"box":{"x":79,"y":852,"width":795,"height":12}},{"id":"b9c6211c-e665-4c05-8371-1fc0a36c64d6","block_type":"box","text":"market regulation or voluntary best practice.","page_number":219,"box":{"x":69,"y":868,"width":314,"height":11}},{"id":"a79ec48f-89a5-468e-a4f5-771e4a7b20ce","block_type":"box","text":"BlackRock Investment Stewardship","page_number":219,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"40bb2f70-4e1d-449e-a386-6d072075a2c8","block_type":"box","text":"Global Principles | 5","page_number":219,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"a417f9f9-9218-423b-94b5-35ff81d36864","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":219,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"81b7bda7-3bb1-48da-9729-a83e68aaf196","block_type":"box","text":"appropriate succession planning. We consider the average overall tenure of the board and seek a balance between","page_number":220,"box":{"x":69,"y":45,"width":819,"height":11}},{"id":"60e014bc-2e5c-4d17-b5d4-fa951360c989","block_type":"box","text":"the knowledge and experience of longer-serving directors and the fresh perspectives of directors who joined more","page_number":220,"box":{"x":68,"y":60,"width":809,"height":11}},{"id":"7c90e898-b66b-460d-bb60-14c43d6dd852","block_type":"box","text":"recently.","page_number":220,"box":{"x":69,"y":75,"width":57,"height":11}},{"id":"45df6085-3cc7-4ea7-a112-d7b305915a53","block_type":"box","text":"We appreciate when companies regularly review and assess how directors nominated for election contribute to","page_number":220,"box":{"x":101,"y":98,"width":789,"height":11}},{"id":"6aea86f9-b71a-4b8d-a2ac-3a5476fa6019","block_type":"box","text":"the effectiveness of the board. In our view, the company’s assessment should consider a number of factors,","page_number":220,"box":{"x":68,"y":113,"width":774,"height":11}},{"id":"d76cb01e-a991-4a46-a648-443c1f003752","block_type":"box","text":"including each director’s independence and time commitments, as well as the breadth and relevance of director","page_number":220,"box":{"x":70,"y":128,"width":798,"height":11}},{"id":"ae6e4c25-20c6-4a10-9a8b-0212463ed220","block_type":"box","text":"experiences and skillsets, and how these collectively contribute to the board’s effectiveness in advising and","page_number":220,"box":{"x":69,"y":143,"width":770,"height":11}},{"id":"03f48223-fa80-4979-be96-c236914222bf","block_type":"box","text":"overseeing management in delivering long-term financial returns.","page_number":220,"box":{"x":69,"y":158,"width":459,"height":11}},{"id":"ffa02c56-a6ee-43ee-9658-6cd6ede57889","block_type":"box","text":"Director independence","page_number":220,"box":{"x":69,"y":188,"width":164,"height":11}},{"id":"167ddc0e-573f-41ab-9fb1-b3df13e78b96","block_type":"box","text":"Director independence — from management, significant shareholders, or other related par ties — is a central","page_number":220,"box":{"x":102,"y":211,"width":777,"height":11}},{"id":"eb70f756-2be3-4378-85cd-da724738f7be","block_type":"box","text":"tenet of sound corporate governance across markets.","page_number":220,"box":{"x":68,"y":226,"width":382,"height":11}},{"id":"6db13c8e-b141-4b1c-a9bc-03e525223d18","block_type":"box","text":"6","page_number":220,"box":{"x":452,"y":226,"width":4,"height":5}},{"id":"34cab357-02de-438a-9d69-bbda3d658d3a","block_type":"box","text":"We look to boards to have a sufficient number of independent","page_number":220,"box":{"x":462,"y":226,"width":442,"height":11}},{"id":"a26b4b35-5eba-4854-95c5-586424299b53","block_type":"box","text":"directors, free from conflicts of interest or undue influence, to ensure objectivity in the decision-making of the board","page_number":220,"box":{"x":69,"y":241,"width":825,"height":11}},{"id":"19d57aca-1cea-4516-9581-a79d350f6777","block_type":"box","text":"and its ability to oversee management. We generally consider it good practice for independent directors to make a","page_number":220,"box":{"x":69,"y":256,"width":813,"height":12}},{"id":"8c6ddbb9-00db-4c3c-90cf-231f0d9cf567","block_type":"box","text":"majority of the board, or in the case of controlled companies, at least one-third.","page_number":220,"box":{"x":69,"y":271,"width":566,"height":12}},{"id":"27ca84bf-66ce-47ed-997d-347698b289c0","block_type":"box","text":"Common impediments to independence may include but are not limited to:","page_number":220,"box":{"x":102,"y":294,"width":531,"height":11}},{"id":"ef8891e2-fffc-491f-a217-411e6797f6b5","block_type":"box","text":"•","page_number":220,"box":{"x":69,"y":317,"width":6,"height":5}},{"id":"5aeed7f7-faff-4ce3-abda-100cd93adb1d","block_type":"box","text":"Current or recent employment at the company or a subsidiary","page_number":220,"box":{"x":102,"y":314,"width":438,"height":11}},{"id":"65055a45-a774-48a2-8934-1cf27e5c0e68","block_type":"box","text":"•","page_number":220,"box":{"x":69,"y":337,"width":6,"height":5}},{"id":"1332ed4d-533c-4575-ae61-89c0b283ff71","block_type":"box","text":"Being, or representing, a shareholder with a substantial shareholding in the company","page_number":220,"box":{"x":102,"y":335,"width":606,"height":11}},{"id":"06bf3125-afc9-4368-ae93-3bbbfe4ab837","block_type":"box","text":"•","page_number":220,"box":{"x":69,"y":357,"width":6,"height":5}},{"id":"5dec34e2-589b-44ab-96fd-0eeff405167c","block_type":"box","text":"Interlocking directorates","page_number":220,"box":{"x":102,"y":355,"width":170,"height":11}},{"id":"390d67db-7d40-4442-aaa0-ba7274b1e738","block_type":"box","text":"•","page_number":220,"box":{"x":69,"y":378,"width":6,"height":4}},{"id":"789b6fa8-9b2e-455d-8141-9e5b1a530703","block_type":"box","text":"Having any other interest, business, or other relationship which could, or could reasonably be perceived to,","page_number":220,"box":{"x":102,"y":375,"width":761,"height":11}},{"id":"710fe9dd-039a-48ce-8bcd-fdcfe1d8d9b3","block_type":"box","text":"materially inter fere with a director’s ability to act in the best interests of the company and shareholders","page_number":220,"box":{"x":102,"y":390,"width":738,"height":11}},{"id":"f1c42022-7984-4c60-a995-448c546b86bb","block_type":"box","text":"In our experience, boards are most effective at overseeing and advising management when there is a senior,","page_number":220,"box":{"x":102,"y":412,"width":775,"height":12}},{"id":"7f7f203d-7890-4463-8ea0-cb7f4cbdc4b5","block_type":"box","text":"independent board leader. This director may chair the board, or, where the chair is also the CEO (or is otherwise not","page_number":220,"box":{"x":70,"y":428,"width":827,"height":11}},{"id":"c6fc04e0-53b7-4500-a98b-f9d59d0a7fc5","block_type":"box","text":"independent), be designated as a lead independent director. The role of this director is to suppor t independent board","page_number":220,"box":{"x":70,"y":443,"width":835,"height":11}},{"id":"31e5b13f-7d01-4487-b894-8943d000e4e3","block_type":"box","text":"members in fulfilling their oversight responsibilities effectively by shaping the agenda, ensuring adequate information","page_number":220,"box":{"x":69,"y":458,"width":834,"height":11}},{"id":"0dd84ba1-e80e-4bc8-a646-0d49c0ee3f2a","block_type":"box","text":"is provided to the board, and encouraging independent director par ticipation in board deliberations. We appreciate","page_number":220,"box":{"x":70,"y":473,"width":813,"height":11}},{"id":"d0a4b6ee-e883-4cee-81ee-600f5ee06d7f","block_type":"box","text":"when the lead independent director or another appropriate director is available to meet with shareholders to explain","page_number":220,"box":{"x":68,"y":488,"width":826,"height":11}},{"id":"33b9741d-592b-4fcb-b3dc-ae7119e6cfe6","block_type":"box","text":"and contextualize a company’s approach as a situation warrants.","page_number":220,"box":{"x":69,"y":503,"width":463,"height":11}},{"id":"8bca61fd-b987-48bf-b16b-4d3d98a6dd6a","block_type":"box","text":"Boards may face matters that could involve conflicts of interest for executives or affiliated directors, or that","page_number":220,"box":{"x":102,"y":526,"width":765,"height":11}},{"id":"f7d9780a-e926-4e00-ad0d-86c0142a4283","block_type":"box","text":"require additional focus. It is our view that objective oversight of such matters is best achieved when the board forms","page_number":220,"box":{"x":69,"y":541,"width":837,"height":11}},{"id":"4860443b-e211-49b2-aa95-b585cd1f7930","block_type":"box","text":"committees with a majority of independent directors, depending on market norms and a company’s ownership","page_number":220,"box":{"x":69,"y":556,"width":784,"height":11}},{"id":"bf04656f-4b30-4830-adce-6c9461c9386d","block_type":"box","text":"structure. In many markets, these committees of the board specialize in audit, director nominations, and","page_number":220,"box":{"x":69,"y":571,"width":747,"height":11}},{"id":"7fa37e12-c1c0-495a-9c87-4cd5ac32aa18","block_type":"box","text":"compensation matters, among others. An ad hoc committee might also be formed to decide on a special transaction,","page_number":220,"box":{"x":69,"y":586,"width":836,"height":12}},{"id":"10a75df2-dfb6-4e5f-885e-1b28fa7ecfc6","block_type":"box","text":"par ticularly one involving a related par ty, or to investigate a significant adverse event.","page_number":220,"box":{"x":70,"y":601,"width":607,"height":12}},{"id":"75880d0b-2e5b-484b-a63a-43f6abadda00","block_type":"box","text":"Sufficient capacity","page_number":220,"box":{"x":68,"y":632,"width":137,"height":11}},{"id":"d58f7e28-1c68-40de-a96f-235d176eef6b","block_type":"box","text":"As the role and expectations of a director are increasingly demanding, directors must be able to commit an","page_number":220,"box":{"x":101,"y":654,"width":763,"height":12}},{"id":"ad5d40e4-ed09-44ea-a017-4a74fb6a586a","block_type":"box","text":"appropriate amount of time to board and committee matters. It is impor tant that directors have the capacity to meet","page_number":220,"box":{"x":69,"y":669,"width":830,"height":12}},{"id":"50211f54-1a8f-413d-a87b-44d25169ddbe","block_type":"box","text":"all of their responsibilities — including when there are unforeseen events — and therefore, we consider it best","page_number":220,"box":{"x":69,"y":685,"width":791,"height":11}},{"id":"baf10ecf-41c0-4f1b-bded-8a00b59c3de9","block_type":"box","text":"practice when they don’t take on an excessive number of roles that would impair their ability to fulfill their duties.","page_number":220,"box":{"x":70,"y":700,"width":804,"height":11}},{"id":"a2ab0beb-cd3d-4b85-8a6c-4da0240b8e6e","block_type":"box","text":"Board composition","page_number":220,"box":{"x":69,"y":730,"width":135,"height":11}},{"id":"a9730146-d2db-41f0-9f34-e24986120516","block_type":"box","text":"In assessing board composition, we take into account a company’s board size, business model, strategy, market","page_number":220,"box":{"x":102,"y":753,"width":806,"height":11}},{"id":"6f8d3f54-6f3f-4bba-8765-23a2143bfd3d","block_type":"box","text":"capitalization, and ownership structure, as well as the market in which the company operates. We find it helpful when","page_number":220,"box":{"x":69,"y":768,"width":836,"height":11}},{"id":"525a7fed-589c-4002-bd5d-70332124456e","block_type":"box","text":"companies explain how their approach to board composition suppor ts the company’s governance practices.","page_number":220,"box":{"x":69,"y":783,"width":767,"height":11}},{"id":"447ce34c-2d3a-4543-a4fb-3ee11bee0128","block_type":"box","text":"When nominating directors to the board, we look to companies to provide sufficient information on the individual","page_number":220,"box":{"x":101,"y":806,"width":802,"height":11}},{"id":"5f81c960-4d12-43ba-9f07-f2465f999d12","block_type":"box","text":"candidates so that shareholders can assess the capabilities and suitability of each individual nominee and their fit","page_number":220,"box":{"x":69,"y":821,"width":818,"height":11}},{"id":"c85593ac-9130-4d4e-8133-a6506375d171","block_type":"box","text":"within overall board composition. These disclosures should explain how the collective experience and exper tise of the","page_number":220,"box":{"x":68,"y":836,"width":840,"height":11}},{"id":"ac7dc654-0557-456f-8194-065b3bd74d69","block_type":"box","text":"board, as well as the par ticular skillsets of individual directors, aligns with the company’s long-term strategy. Highly","page_number":220,"box":{"x":69,"y":851,"width":823,"height":11}},{"id":"2d2a537e-a26e-49f4-8c95-3e5d7744c120","block_type":"box","text":"6","page_number":220,"box":{"x":69,"y":881,"width":4,"height":4}},{"id":"0478581b-43f6-4b61-9ff4-6591bf319a62","block_type":"box","text":"For example, please see: Tokyo Stock Exchange, “Japan’s Corporate Governance Code,” June 11, 2021; Financial","page_number":220,"box":{"x":79,"y":880,"width":813,"height":11}},{"id":"7431fe51-8f2a-40a7-b844-7a7333097a87","block_type":"box","text":"Repor ting Council, “UK Corporate Governance Code,” January 2024, accessed in December 2025.","page_number":220,"box":{"x":70,"y":895,"width":704,"height":12}},{"id":"f5f04d78-10d7-4dff-bb7c-5bc2ed818993","block_type":"box","text":"BlackRock Investment Stewardship","page_number":220,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"82a6a720-79b2-4919-a844-ea4d58ca159e","block_type":"box","text":"Global Principles | 6","page_number":220,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"1fc5829d-74a7-4504-b174-d479b4a8efc4","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":220,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"22413e5c-99c1-418b-96dd-f4ffdb9505f1","block_type":"box","text":"qualified, engaged directors with professional characteristics relevant to a company’s business and strategy enhance","page_number":221,"box":{"x":69,"y":45,"width":836,"height":11}},{"id":"bdd1bad5-5fcb-4e1a-89c0-fbdc605caf01","block_type":"box","text":"the ability of the board to add value and be the voice of shareholders in board discussions.","page_number":221,"box":{"x":68,"y":60,"width":650,"height":11}},{"id":"fab86e26-8aa5-4b43-b310-721674571600","block_type":"box","text":"It is in this context that we are interested in a variety of experiences, perspectives, and skillsets in the board","page_number":221,"box":{"x":102,"y":82,"width":775,"height":12}},{"id":"dd39a4fb-e6d1-4910-84fd-a5779864e8c3","block_type":"box","text":"room. We see it as a means of avoiding “group think” in the board’s exercise of its responsibilities to advise and","page_number":221,"box":{"x":69,"y":98,"width":806,"height":11}},{"id":"f40404ae-adbe-486f-8300-0b9f38966812","block_type":"box","text":"oversee management. We note that in many markets, policymakers have set board gender diversity goals which we","page_number":221,"box":{"x":69,"y":113,"width":820,"height":11}},{"id":"ddd091b4-f81e-40fe-b0da-be116e23bcf0","block_type":"box","text":"may discuss with companies, par ticularly if there is a risk their board composition may be misaligned.","page_number":221,"box":{"x":69,"y":128,"width":726,"height":11}},{"id":"d98bf4e3-e25f-4a81-b74d-16b39273c97c","block_type":"box","text":"AUDITORS AND AUDIT-RELATED ISSUES","page_number":221,"box":{"x":342,"y":158,"width":293,"height":9}},{"id":"2928811f-8e10-4b28-bdf2-0e977b00a46a","block_type":"box","text":"BIS recognizes the critical impor tance of financial statements to provide a complete and accurate por trayal of a","page_number":221,"box":{"x":102,"y":181,"width":795,"height":11}},{"id":"a21ac828-d7a2-44d0-91ac-2ee8e2c28b53","block_type":"box","text":"company’s financial condition. Accordingly, we look for the assumptions made by management, and reviewed by the","page_number":221,"box":{"x":69,"y":196,"width":825,"height":11}},{"id":"2290ee41-8094-48fe-a65a-2af77a8d0fa4","block_type":"box","text":"auditor in preparing the financial statements, to be reasonable and justified.","page_number":221,"box":{"x":69,"y":211,"width":543,"height":11}},{"id":"04078b15-af6f-4b7f-949a-82a3fb9b0671","block_type":"box","text":"We view the audit committee, or its equivalent, as responsible for overseeing the management of the","page_number":221,"box":{"x":101,"y":234,"width":722,"height":11}},{"id":"4583c199-0600-4b33-b8da-7b85142fc167","block_type":"box","text":"independent auditor and the internal audit function at a company. The committee plays an impor tant role in a","page_number":221,"box":{"x":70,"y":249,"width":778,"height":11}},{"id":"063878a4-36a4-4ac6-95cf-fc626e7bc346","block_type":"box","text":"company’s financial repor ting system by providing independent oversight of the accounts, material financial, and,","page_number":221,"box":{"x":69,"y":264,"width":806,"height":11}},{"id":"7b453f78-c969-4bed-841d-aeb6671e0e8c","block_type":"box","text":"where appropriate to the jurisdiction, non-financial information and internal control frameworks. Moreover, in the","page_number":221,"box":{"x":68,"y":279,"width":799,"height":11}},{"id":"a195185f-8f03-404c-8a9b-816ea301627e","block_type":"box","text":"absence of a dedicated risk committee, these committees can provide oversight of Enterprise Risk Management","page_number":221,"box":{"x":69,"y":294,"width":801,"height":11}},{"id":"15fe9af7-a877-4004-8b90-a78c60fc01c0","block_type":"box","text":"systems.","page_number":221,"box":{"x":69,"y":310,"width":62,"height":10}},{"id":"2c3ab343-2e48-4515-abd1-572b93f44ffe","block_type":"box","text":"7","page_number":221,"box":{"x":133,"y":310,"width":4,"height":4}},{"id":"804040a7-0ccc-4798-abba-be1491103052","block_type":"box","text":"In our view, effective audit committee oversight strengthens the quality and reliability of a company’s","page_number":221,"box":{"x":144,"y":309,"width":717,"height":11}},{"id":"1d1b42a3-50ef-4c6a-acc8-e40e05253a41","block_type":"box","text":"financial statements and provides an impor tant level of reassurance to shareholders.","page_number":221,"box":{"x":68,"y":324,"width":609,"height":11}},{"id":"fcb61cbd-1e83-4a1f-8172-4f688376d75a","block_type":"box","text":"We look to audit committees, or their equivalent, to have clearly ar ticulated char ters that set out their","page_number":221,"box":{"x":101,"y":347,"width":727,"height":11}},{"id":"9a9918ae-de08-4a5c-9a00-a29589e5de9c","block_type":"box","text":"responsibilities. Additionally, having a rotation plan can periodically refresh the committee membership and introduce","page_number":221,"box":{"x":69,"y":362,"width":835,"height":11}},{"id":"47b2d611-ce59-4f09-8b82-e84260edd20f","block_type":"box","text":"new perspectives. We recognize that audit committees will rely on management, internal audit, and the independent","page_number":221,"box":{"x":69,"y":377,"width":827,"height":12}},{"id":"2ee82115-84a1-449a-acbe-a8a358d2344d","block_type":"box","text":"auditor to fulfill their responsibilities. However, we look to committee members to demonstrate they have relevant","page_number":221,"box":{"x":69,"y":392,"width":810,"height":12}},{"id":"8835a970-db56-4484-852b-d6c31ea5b357","block_type":"box","text":"exper tise to monitor and oversee the audit process and related activities.","page_number":221,"box":{"x":69,"y":408,"width":523,"height":10}},{"id":"2aca40cc-d57c-4d93-b491-4ef51d1e1548","block_type":"box","text":"We take par ticular note of unexplained changes in repor ting methodology, cases involving significant financial","page_number":221,"box":{"x":101,"y":430,"width":780,"height":11}},{"id":"d93e2bfe-bfd4-4e28-bb12-8612a6255d77","block_type":"box","text":"restatements, or ad hoc notifications of material financial weakness. In this respect, we look to audit committees to","page_number":221,"box":{"x":69,"y":445,"width":828,"height":11}},{"id":"d364a1e2-4096-49aa-b23f-dde765ead1eb","block_type":"box","text":"provide timely disclosure on the remediation of key and critical audit matters identified either by the external auditor","page_number":221,"box":{"x":70,"y":460,"width":827,"height":12}},{"id":"65104c4d-efbe-45c9-a5e9-f667564026f3","block_type":"box","text":"or internal audit function.","page_number":221,"box":{"x":69,"y":475,"width":178,"height":9}},{"id":"d4f7fca3-72f6-4a60-986c-94f321e10aa7","block_type":"box","text":"The integrity of financial statements depends on the auditor being free of any impediments that could","page_number":221,"box":{"x":101,"y":498,"width":723,"height":11}},{"id":"70e30ae5-b57e-4fd5-ae4e-10b2351dfbca","block_type":"box","text":"compromise its ability to serve as an effective check on management. To that end, it is impor tant that auditors are,","page_number":221,"box":{"x":69,"y":513,"width":825,"height":12}},{"id":"8ee44f8c-dd55-452c-96dc-818afe76e9bf","block_type":"box","text":"and are seen to be, independent. Where an audit firm provides services to the company in addition to the audit, we","page_number":221,"box":{"x":69,"y":528,"width":824,"height":12}},{"id":"1829722f-1aff-48ac-895a-6fb5d60f1a49","block_type":"box","text":"look for the fees earned to be disclosed and explained. We look for audit committees to have in place a procedure for","page_number":221,"box":{"x":70,"y":543,"width":839,"height":11}},{"id":"3eedaf33-f64c-4f89-bae4-095d1fe2d6d2","block_type":"box","text":"assessing the independence of the auditor and the quality of the external audit process on an annual basis.","page_number":221,"box":{"x":69,"y":559,"width":770,"height":11}},{"id":"9a5dfe46-abb1-4602-916f-ad410c66a4ef","block_type":"box","text":"Comprehensive disclosure provides investors with an understanding of the company’s long-term operational risk","page_number":221,"box":{"x":102,"y":581,"width":799,"height":12}},{"id":"5f2809c4-249c-49d0-b4cc-bff2b01c7cbd","block_type":"box","text":"management practices and, more broadly, the quality of the board’s oversight. We look to the audit or risk committee","page_number":221,"box":{"x":69,"y":596,"width":836,"height":12}},{"id":"a3e1d0ba-4c6b-4dc1-9564-3150874c2857","block_type":"box","text":"to periodically review the company’s risk assessment and risk management policies and the significant risks and","page_number":221,"box":{"x":68,"y":612,"width":806,"height":11}},{"id":"8b097578-e508-4814-b85e-2f86e7dfd63d","block_type":"box","text":"exposures identified by management, the internal auditors or the independent auditors, and management’s steps to","page_number":221,"box":{"x":69,"y":627,"width":829,"height":11}},{"id":"a8ea5f3a-c728-4d28-aeac-d49d695aed1c","block_type":"box","text":"address them. In the absence of detailed disclosures, we may conclude that companies are not adequately managing","page_number":221,"box":{"x":69,"y":642,"width":840,"height":11}},{"id":"36bc522c-8829-4d69-a362-d8cce862e34e","block_type":"box","text":"risk.","page_number":221,"box":{"x":69,"y":657,"width":28,"height":9}},{"id":"d36cf149-13a9-414c-9bd5-59ed2d7ca0b5","block_type":"box","text":"CAPITAL STRUCTURE, MERGERS, ACQUISITIONS, ASSET SALES, AND OTHER SPECIAL SITUATIONS","page_number":221,"box":{"x":125,"y":687,"width":728,"height":11}},{"id":"db4706e1-8180-47f0-8388-ab9988317428","block_type":"box","text":"The capital structure of a company is critical to shareholders as it impacts the value of their investment and the","page_number":221,"box":{"x":101,"y":710,"width":798,"height":11}},{"id":"a5bb5f48-d073-452d-ab2d-66d9fa9cc25b","block_type":"box","text":"priority of their interest in the company relative to that of other equity or debt investors. Pre-emptive rights are a key","page_number":221,"box":{"x":70,"y":725,"width":824,"height":11}},{"id":"b6cd1608-5994-4dd8-b906-4bcd382cf4a7","block_type":"box","text":"protection for shareholders against the dilution of their interests.","page_number":221,"box":{"x":70,"y":740,"width":460,"height":11}},{"id":"d43d66e2-670d-4917-b554-64e1ac56de41","block_type":"box","text":"In principle, we have concerns with the creation of a share class with equivalent economic exposure and","page_number":221,"box":{"x":102,"y":763,"width":743,"height":11}},{"id":"d5c8f50f-8fb3-4538-808c-b3b89554fa54","block_type":"box","text":"differentiated voting rights. As a result, BIS generally suppor ts bylaw amendments that introduce the adoption of","page_number":221,"box":{"x":69,"y":778,"width":805,"height":11}},{"id":"b86f969e-c0f6-4dd8-a085-2baae47bc9b0","block_type":"box","text":"“one share, one vote” for registered shareholders.","page_number":221,"box":{"x":70,"y":793,"width":358,"height":11}},{"id":"c8192fd7-add3-4e17-9eaa-0b7aac268024","block_type":"box","text":"7","page_number":221,"box":{"x":69,"y":823,"width":4,"height":4}},{"id":"a87dfd36-8003-4e8d-a28f-bad4cf286e12","block_type":"box","text":"Enterprise Risk Management is a process, effected by the entity’s board of directors, management, and other","page_number":221,"box":{"x":79,"y":822,"width":784,"height":12}},{"id":"fbf76094-7f78-4c63-8a07-9e15ecb910b9","block_type":"box","text":"personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect","page_number":221,"box":{"x":70,"y":837,"width":834,"height":12}},{"id":"c78f9085-b301-43cb-9970-99e50bc62772","block_type":"box","text":"the entity, and manage risk to be within the risk appetite, to provide reasonable assurance regarding the achievement","page_number":221,"box":{"x":68,"y":853,"width":841,"height":11}},{"id":"36027f75-44ca-4551-959a-fe3dbdc80374","block_type":"box","text":"of objectives. Please see: The Committee of Sponsoring Organizations of the Treadway Commission (COSO),","page_number":221,"box":{"x":69,"y":868,"width":771,"height":11}},{"id":"9912edef-5b22-4b78-b82f-f3b4b8fb71f1","block_type":"box","text":"“Enterprise Risk Management,” 2023, accessed in December 2025.","page_number":221,"box":{"x":70,"y":883,"width":488,"height":11}},{"id":"61df3001-9d5c-4cc7-a947-524b16b19103","block_type":"box","text":"BlackRock Investment Stewardship","page_number":221,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"3d7cd129-248a-4a0d-ba1f-2e2baa3513d4","block_type":"box","text":"Global Principles | 7","page_number":221,"box":{"x":768,"y":942,"width":140,"height":13}},{"id":"0c1ef991-3cdd-4665-8fbe-37daf720aa26","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":221,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"61eee5da-49fd-4200-961a-49db050c5507","block_type":"box","text":"However, we recognize that in cer tain markets, at least for a period of time, companies may have a valid reason","page_number":222,"box":{"x":102,"y":45,"width":798,"height":11}},{"id":"fe24dfc5-3f63-46ed-8336-43bb1f420386","block_type":"box","text":"for listing dual classes of shares with differentiated voting rights. In our view, such companies should review these","page_number":222,"box":{"x":68,"y":60,"width":818,"height":11}},{"id":"5df02513-5cb7-4d77-9804-145ec7ace51d","block_type":"box","text":"share class structures on a regular basis or as company circumstances change. Additionally, they should seek","page_number":222,"box":{"x":69,"y":75,"width":788,"height":11}},{"id":"89869096-c308-43d0-a32a-e9e880ddab90","block_type":"box","text":"shareholder approval of their capital structure on a periodic basis via a management proposal at the company’s","page_number":222,"box":{"x":69,"y":90,"width":797,"height":11}},{"id":"e1aa6330-d378-444d-ba9a-265f6107f3ee","block_type":"box","text":"shareholder meeting. The proposal should give unaffiliated shareholders the oppor tunity to affirm the current","page_number":222,"box":{"x":69,"y":105,"width":780,"height":11}},{"id":"bd0803b0-8435-427b-8a8f-09c091835fec","block_type":"box","text":"structure or establish mechanisms to end or phase out controlling structures at the appropriate time, while","page_number":222,"box":{"x":69,"y":120,"width":764,"height":12}},{"id":"ba55d7f7-031c-4617-993b-965581d854ab","block_type":"box","text":"minimizing costs to shareholders.","page_number":222,"box":{"x":69,"y":136,"width":238,"height":11}},{"id":"646456ac-9cad-4ad0-9241-fb4a4a77ddbd","block_type":"box","text":"In assessing mergers, asset sales, or other special situations, BIS’ primary consideration is the long-term","page_number":222,"box":{"x":102,"y":158,"width":756,"height":11}},{"id":"af1c1e6f-268c-4708-9b52-825da53dc23f","block_type":"box","text":"financial interests of our clients as shareholders, and so we will review any proposed transaction with that objective","page_number":222,"box":{"x":68,"y":173,"width":826,"height":11}},{"id":"a37292f1-286e-471d-ac62-8c14c5d7a8f5","block_type":"box","text":"in mind. Typically, we review factors such as whether the proposed transaction has the unanimous suppor t of the","page_number":222,"box":{"x":70,"y":188,"width":806,"height":11}},{"id":"2ad191a5-1339-492d-a9c7-19ee095a15f9","block_type":"box","text":"board and has been negotiated at arm’s length, and whether the board or management has clearly explained its","page_number":222,"box":{"x":69,"y":204,"width":799,"height":11}},{"id":"9c097cc3-03fc-434c-a2f8-7a1ccbdb69dc","block_type":"box","text":"economic and strategic rationale. We may also seek reassurance from the board that the financial interests of","page_number":222,"box":{"x":69,"y":218,"width":788,"height":12}},{"id":"f61189f6-5a63-45b9-9506-db62189e7a5f","block_type":"box","text":"executives and/or board members in a given transaction have not adversely affected their ability to place","page_number":222,"box":{"x":69,"y":234,"width":750,"height":11}},{"id":"5d3d0594-a3f9-4dba-be5d-58729e32165c","block_type":"box","text":"shareholders’ interests before their own. Where the transaction involves related par ties, the recommendation to","page_number":222,"box":{"x":69,"y":249,"width":801,"height":11}},{"id":"4222f383-71ac-4c51-8a80-b1ba05f12851","block_type":"box","text":"suppor t should come from the independent directors, a best practice in most markets, and ideally, the terms should","page_number":222,"box":{"x":69,"y":264,"width":830,"height":11}},{"id":"2a214eab-1be0-4c64-ab42-1c6a85396401","block_type":"box","text":"have been assessed through an independent appraisal process. In addition, it is good practice that it be approved by","page_number":222,"box":{"x":69,"y":279,"width":836,"height":11}},{"id":"5ad21849-d64c-494d-ab2b-872ff5a31887","block_type":"box","text":"a separate vote of the non-conflicted par ties.","page_number":222,"box":{"x":69,"y":294,"width":320,"height":11}},{"id":"4f9511bb-bc48-46c0-95af-69b3505ed98c","block_type":"box","text":"As a matter of sound governance practice, shareholders should have a right to dispose of company shares in the","page_number":222,"box":{"x":101,"y":317,"width":806,"height":11}},{"id":"1e237d1b-2aff-420c-a822-fcd398c62501","block_type":"box","text":"open market without unnecessary restriction. In our view, corporate mechanisms designed to limit shareholders’","page_number":222,"box":{"x":69,"y":332,"width":801,"height":11}},{"id":"e0ee72b6-7c6f-4868-9ee7-4d055d9aa15f","block_type":"box","text":"ability to sell their shares are contrary to basic proper ty rights. Such mechanisms can serve to protect and entrench","page_number":222,"box":{"x":69,"y":347,"width":829,"height":11}},{"id":"4ed92ee0-83e8-47bf-a4ed-0090d310f24d","block_type":"box","text":"interests other than those of the shareholders. In our view, shareholders are broadly capable of making decisions in","page_number":222,"box":{"x":70,"y":362,"width":826,"height":11}},{"id":"e0656170-e7d2-4d70-ba1b-0f934b10b6b9","block_type":"box","text":"their own best interests. We encourage any shareholder rights plans proposed by a board to be subject to","page_number":222,"box":{"x":68,"y":377,"width":755,"height":12}},{"id":"a349c231-b686-4373-a232-2f8dc014b476","block_type":"box","text":"shareholder approval upon introduction and periodically thereafter.","page_number":222,"box":{"x":69,"y":392,"width":472,"height":12}},{"id":"88168e46-73ea-42bd-998a-ee66f55b51fe","block_type":"box","text":"EXECUTIVE COMPENSATION AND BENEFITS","page_number":222,"box":{"x":328,"y":423,"width":322,"height":9}},{"id":"c7071506-5c35-4976-891f-faa2e1b0eedf","block_type":"box","text":"Executive compensation is an impor tant tool used by companies to suppor t long-term financial value creation. A","page_number":222,"box":{"x":102,"y":445,"width":799,"height":12}},{"id":"996b724d-ac34-427a-86d3-81d13b439429","block_type":"box","text":"well-structured compensation policy rewards the successful delivery of strategic, operational, and/or financial goals;","page_number":222,"box":{"x":68,"y":460,"width":830,"height":12}},{"id":"9fba4ade-4db8-43c3-b1cc-8b4588031291","block_type":"box","text":"encourages an appropriate risk appetite; and aligns the interests of shareholders and executives through equity","page_number":222,"box":{"x":69,"y":475,"width":797,"height":12}},{"id":"1432bfd5-36aa-4401-83c4-c8392f169568","block_type":"box","text":"ownership.","page_number":222,"box":{"x":69,"y":491,"width":75,"height":11}},{"id":"7e2c3101-165a-4a97-8321-bf1713ef3964","block_type":"box","text":"8","page_number":222,"box":{"x":146,"y":491,"width":4,"height":4}},{"id":"eac3c68d-96f5-48a6-b8aa-a5319a64642a","block_type":"box","text":"We look for a clear link between variable pay and operational and financial per formance that suppor t sustained","page_number":222,"box":{"x":101,"y":513,"width":793,"height":11}},{"id":"a91e594e-445a-4c81-94aa-a981d817cb4f","block_type":"box","text":"financial value creation for our clients as shareholders. We appreciate when per formance targets incorporate","page_number":222,"box":{"x":68,"y":528,"width":778,"height":12}},{"id":"7d2b0d62-79f1-47f5-9b30-3ed182debe5f","block_type":"box","text":"ambitious objectives, and the corresponding metrics are aligned with the company’s strategy and business model.","page_number":222,"box":{"x":69,"y":544,"width":815,"height":11}},{"id":"8897b3f7-6ad6-4790-ae53-9eddc8f970c6","block_type":"box","text":"BIS does not have a position on whether companies choose to use sustainability-related criteria in compensation","page_number":222,"box":{"x":70,"y":559,"width":804,"height":11}},{"id":"e73c82fa-ef74-40ce-883f-2a08f9bd2ec8","block_type":"box","text":"structures, but, where they are included, we look to companies to be as rigorous as they would be in setting other","page_number":222,"box":{"x":69,"y":574,"width":814,"height":11}},{"id":"55d3dbd1-64e7-4a68-abf0-1836178f95bf","block_type":"box","text":"financial or operational targets. We appreciate when long-term incentive plans encompass timeframes that: 1) are","page_number":222,"box":{"x":68,"y":589,"width":813,"height":11}},{"id":"412a96bc-aeda-47fa-ba91-913a5b265604","block_type":"box","text":"distinct from annual executive compensation structures and metrics, and 2) encourage the delivery of strong financial","page_number":222,"box":{"x":69,"y":604,"width":839,"height":11}},{"id":"b67ec20f-4f20-4925-a680-d4c330af8b76","block_type":"box","text":"results over a period of years.","page_number":222,"box":{"x":69,"y":619,"width":211,"height":11}},{"id":"d213c093-14f2-43ea-bb2f-1abc15ca908c","block_type":"box","text":"We consider it best practice when board members responsible for designing and approving executive","page_number":222,"box":{"x":101,"y":642,"width":718,"height":11}},{"id":"3146aaea-c355-4eee-9f6e-047a869b00ff","block_type":"box","text":"compensation carefully consider the company’s specific circumstances. Factors to consider may include the","page_number":222,"box":{"x":69,"y":657,"width":770,"height":11}},{"id":"518b6638-1dd2-484c-839e-149b7e08b472","block_type":"box","text":"company’s risk profile, the environment it operates in, and the individuals the board is trying to attract and retain. We","page_number":222,"box":{"x":69,"y":672,"width":838,"height":11}},{"id":"25768925-aca9-4335-9077-4a4c24156fd2","block_type":"box","text":"look to the compensation committees to guard against contractual arrangements that would entitle executives to","page_number":222,"box":{"x":70,"y":687,"width":804,"height":11}},{"id":"fcd71e8f-cc17-4074-8558-742a905f5162","block_type":"box","text":"material compensation for early termination of their employment. Finally, we look for pension contributions and other","page_number":222,"box":{"x":69,"y":702,"width":831,"height":11}},{"id":"d672e928-e31e-4bb4-8dba-f728d1862d40","block_type":"box","text":"deferred compensation arrangements to be reasonable in light of market practices or the company’s business and","page_number":222,"box":{"x":69,"y":717,"width":817,"height":12}},{"id":"f75993dd-f3d1-4fdb-9def-615b17df6927","block_type":"box","text":"executive compensation strategies.","page_number":222,"box":{"x":69,"y":733,"width":250,"height":11}},{"id":"e7633e4e-ae9a-4c97-abe8-20d00fecacf1","block_type":"box","text":"We are not suppor tive of one-off or special bonuses unrelated to company or individual per formance. Where","page_number":222,"box":{"x":101,"y":755,"width":772,"height":11}},{"id":"54d4066b-9d2e-4b78-9117-77ccb73fc6cb","block_type":"box","text":"discretion has been used by the compensation committee, or its equivalent, we appreciate disclosure relating to how","page_number":222,"box":{"x":69,"y":771,"width":836,"height":11}},{"id":"3c583e4a-0dcd-442b-ac14-f29e80e2c759","block_type":"box","text":"and why the discretion was used, and how the adjusted outcome is aligned with the interests of shareholders. In","page_number":222,"box":{"x":69,"y":785,"width":803,"height":12}},{"id":"f38263ba-770b-4345-8aae-636e2dd14931","block_type":"box","text":"addition, we acknowledge that the use of peer group evaluation by compensation committees can help ensure","page_number":222,"box":{"x":69,"y":801,"width":785,"height":11}},{"id":"849b2985-0dcf-437e-82cd-57304fd9fda4","block_type":"box","text":"competitive pay. However, we encourage companies to clearly explain how compensation outcomes have rewarded","page_number":222,"box":{"x":69,"y":816,"width":815,"height":11}},{"id":"9bad3d82-33f6-41d1-bd1d-935b14261be7","block_type":"box","text":"per formance rather than solely base increases in total compensation on peer benchmarking.","page_number":222,"box":{"x":70,"y":831,"width":659,"height":11}},{"id":"7acb7121-6c2e-4870-bfb0-7b0975552425","block_type":"box","text":"8","page_number":222,"box":{"x":69,"y":860,"width":4,"height":5}},{"id":"059d4b12-92dd-48d3-908b-1216bee1ff1e","block_type":"box","text":"The terms “compensation,” “remuneration,” and “pay” are used interchangeably to describe the same concept in","page_number":222,"box":{"x":78,"y":860,"width":811,"height":11}},{"id":"9b053ffb-1efa-4bce-8aec-4ac3217e5d0a","block_type":"box","text":"different markets.","page_number":222,"box":{"x":69,"y":875,"width":126,"height":9}},{"id":"4555ab62-a820-4bca-8a25-7d6978b534c8","block_type":"box","text":"BlackRock Investment Stewardship","page_number":222,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"f004c2d6-c748-4a58-99b9-8bb42166c516","block_type":"box","text":"Global Principles | 8","page_number":222,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"d987adaa-24f1-4ded-843f-0919720954a1","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":222,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"ced8bc03-f913-4228-8131-75f5ac69628b","block_type":"box","text":"We consider the inclusion of building clawback provisions into incentive plans as good practice. Such provisions","page_number":223,"box":{"x":101,"y":45,"width":797,"height":11}},{"id":"c941919d-6583-4b5b-9855-edc51cf0c000","block_type":"box","text":"could require executives to forgo awards when compensation was based on faulty financial statements or deceptive","page_number":223,"box":{"x":69,"y":60,"width":825,"height":11}},{"id":"f7837e5b-b4bb-4061-8c4c-2e4209b4b9ab","block_type":"box","text":"business practices, or when their behavior caused material financial harm to shareholders, material reputational risk","page_number":223,"box":{"x":69,"y":75,"width":833,"height":11}},{"id":"bd657334-fe8f-4994-8f71-85429db83f2d","block_type":"box","text":"to the company, or resulted in a criminal investigation.","page_number":223,"box":{"x":68,"y":90,"width":386,"height":11}},{"id":"bc6372c0-570f-4c12-bfb4-169f684ecf23","block_type":"box","text":"In our view, non-executive directors should be compensated in a manner that is commensurate with the time and","page_number":223,"box":{"x":102,"y":113,"width":803,"height":11}},{"id":"33e36298-8433-46de-b558-0f09943512f1","block_type":"box","text":"effor t expended in fulfilling their professional responsibilities. Additionally, these compensation arrangements should","page_number":223,"box":{"x":69,"y":128,"width":834,"height":11}},{"id":"2760d912-d172-41b8-b1c7-78e4badbb093","block_type":"box","text":"not risk compromising directors’ independence or aligning their interests too closely with those of the management,","page_number":223,"box":{"x":69,"y":143,"width":825,"height":11}},{"id":"b6ea1e14-c3a6-46ce-a40e-482fb050fc26","block_type":"box","text":"whom they are charged with overseeing.","page_number":223,"box":{"x":68,"y":158,"width":285,"height":11}},{"id":"227870e0-95b5-47a7-9035-51b6031b6c86","block_type":"box","text":"When assessing compensation proposals, BIS reviews companies’ disclosures to determine whether the board’s","page_number":223,"box":{"x":101,"y":181,"width":807,"height":11}},{"id":"d01317cb-8e15-4a47-9ee1-31e147b00ca5","block_type":"box","text":"approach to executive compensation is rigorous in light of the company’s stated long-term corporate strategy and","page_number":223,"box":{"x":69,"y":196,"width":807,"height":11}},{"id":"f05f338d-6120-4f80-915d-9a62b6809352","block_type":"box","text":"specific circumstances, as well as local market and policy developments.","page_number":223,"box":{"x":69,"y":211,"width":521,"height":11}},{"id":"eaea8ffc-3d5c-427a-8fe7-72695865eee3","block_type":"box","text":"When our analysis indicates that executive compensation is misaligned with company per formance, BIS may not","page_number":223,"box":{"x":101,"y":234,"width":802,"height":11}},{"id":"ef3eb2f1-2a9c-49f4-87b1-b2d13f22b07e","block_type":"box","text":"suppor t management’s proposals to approve compensation, where they are on the agenda. We may also not suppor t","page_number":223,"box":{"x":69,"y":249,"width":838,"height":11}},{"id":"f3d6251d-2da2-4f38-89e0-87511907440f","block_type":"box","text":"members of the compensation committee or equivalent board members for poor compensation practices or","page_number":223,"box":{"x":69,"y":264,"width":766,"height":11}},{"id":"235b6ddf-def0-48ab-8d32-8b89929f63c0","block_type":"box","text":"structures.","page_number":223,"box":{"x":69,"y":280,"width":76,"height":8}},{"id":"907b036c-32d8-48d1-8a9b-db637a2cd6f3","block_type":"box","text":"SHAREHOLDER PROTECTIONS AND OTHER CORPORATE GOVERNANCE MATTERS","page_number":223,"box":{"x":191,"y":309,"width":595,"height":9}},{"id":"99c3c28f-9761-4e97-8876-56351d22fa79","block_type":"box","text":"Corporate form","page_number":223,"box":{"x":69,"y":339,"width":108,"height":11}},{"id":"f24637f6-0a04-4fa1-92ab-d25b43c4baef","block_type":"box","text":"In our view, it is the responsibility of the board to determine the corporate form that is most appropriate given","page_number":223,"box":{"x":102,"y":362,"width":781,"height":11}},{"id":"18ffa9e3-f3f1-4a0d-86f7-b8ad12fe396b","block_type":"box","text":"the company’s purpose and business model.","page_number":223,"box":{"x":68,"y":377,"width":320,"height":11}},{"id":"a3255b18-b965-4efa-9f25-68e68fb3d0ed","block_type":"box","text":"9","page_number":223,"box":{"x":390,"y":378,"width":4,"height":4}},{"id":"676089d8-3bb3-4ec3-ae30-bce9ffae5b99","block_type":"box","text":"We look to companies proposing to change their corporate form to a","page_number":223,"box":{"x":399,"y":377,"width":487,"height":12}},{"id":"f36080d1-7f05-4dca-a46c-1fe0718d19bb","block_type":"box","text":"public benefit corporation, or similar entity, to put it to a shareholder vote if not already required to do so under","page_number":223,"box":{"x":70,"y":392,"width":791,"height":12}},{"id":"b724b619-c4c3-4988-b68d-55fa0cbd166f","block_type":"box","text":"applicable law. We appreciate when suppor ting documentation from companies or shareholders proposing to alter the","page_number":223,"box":{"x":69,"y":407,"width":839,"height":12}},{"id":"2d75b0dc-b878-4778-b06d-663feb234b02","block_type":"box","text":"corporate form clearly explains how the interests of shareholders and different stakeholders would be impacted as","page_number":223,"box":{"x":69,"y":423,"width":818,"height":11}},{"id":"aa5907fc-51b7-4400-bddb-dffc10d0e431","block_type":"box","text":"well as the accountability and voting mechanisms that would be available to shareholders. We generally suppor t","page_number":223,"box":{"x":68,"y":438,"width":800,"height":11}},{"id":"2cadeb40-6f5a-4252-8f5c-d975130fac12","block_type":"box","text":"management proposals if our analysis indicates that shareholders’ financial interests are adequately protected.","page_number":223,"box":{"x":69,"y":453,"width":796,"height":11}},{"id":"df9b6147-774a-4d8f-9cc0-8dd1e7168a9f","block_type":"box","text":"Corporate form shareholder proposals are evaluated on a case-by-case basis.","page_number":223,"box":{"x":69,"y":468,"width":552,"height":11}},{"id":"05f013fb-6c99-4175-aa0c-2c5a9446e4b4","block_type":"box","text":"SHAREHOLDER PROPOSALS","page_number":223,"box":{"x":385,"y":498,"width":207,"height":9}},{"id":"5cb95909-52e4-4158-8e61-b86acd59b868","block_type":"box","text":"In most markets, shareholders can submit proposals to be voted on at a company’s shareholder meeting, as","page_number":223,"box":{"x":102,"y":521,"width":777,"height":11}},{"id":"f94dc210-1970-430b-9104-03fa48996c90","block_type":"box","text":"long as cer tain requirements are met. Shareholder proposals span a wide range of topics, including governance","page_number":223,"box":{"x":70,"y":536,"width":796,"height":11}},{"id":"c2cb96ac-1963-4f5c-9c27-1732f1571fd8","block_type":"box","text":"reforms, capital management, and changes in the management or disclosure of sustainability-related risks. These","page_number":223,"box":{"x":69,"y":551,"width":813,"height":11}},{"id":"1b5f8598-0384-45e5-a7ed-f4cae511e68b","block_type":"box","text":"proposals have a varying degree of relevance for companies across sectors, locations, and business models.","page_number":223,"box":{"x":70,"y":566,"width":779,"height":11}},{"id":"79385fea-2393-470b-94e6-47fd7c0a6e44","block_type":"box","text":"BIS takes a case-by-case approach to voting on shareholder proposals and maintains a singular focus on the","page_number":223,"box":{"x":102,"y":589,"width":775,"height":11}},{"id":"ea7729dc-07b6-4d6e-b1b4-066274749a72","block_type":"box","text":"proposal’s implications for long-term financial value creation for shareholders. Our analysis considers whether a","page_number":223,"box":{"x":70,"y":604,"width":796,"height":11}},{"id":"7898e191-3b7e-476e-b881-00ed8e1aa908","block_type":"box","text":"shareholder proposal addresses a material risk that may impact a company’s long-term financial per formance. BIS","page_number":223,"box":{"x":69,"y":619,"width":818,"height":11}},{"id":"3e24d1a9-fd1d-47f2-9f28-fe42ed39954b","block_type":"box","text":"may suppor t shareholder proposals that request disclosures that help us, as long-term investors on behalf of our","page_number":223,"box":{"x":69,"y":634,"width":809,"height":12}},{"id":"5c0f9c91-cf6e-42f1-a31c-a4e3b467422e","block_type":"box","text":"clients, better understand the material risks and oppor tunities companies face and how they are managing them,","page_number":223,"box":{"x":69,"y":649,"width":807,"height":12}},{"id":"94db885d-efa4-4edf-b6d3-f313b5e91682","block_type":"box","text":"especially where this information is additive given the company’s existing disclosures. We look for consistency","page_number":223,"box":{"x":69,"y":664,"width":787,"height":12}},{"id":"48cc9954-e510-487d-9dc3-71d87322a421","block_type":"box","text":"between the specific request formally made in the proposal, the suppor ting documentation, and the proponents’","page_number":223,"box":{"x":69,"y":680,"width":801,"height":11}},{"id":"51621ba6-23c8-4f71-b2ed-21951db30d78","block_type":"box","text":"other communications on the issues. We also assess the company’s practices and disclosures and the costs and","page_number":223,"box":{"x":69,"y":695,"width":813,"height":11}},{"id":"5ea99c86-2876-4811-8a3c-7870f7526f18","block_type":"box","text":"benefits to the company of meeting the request made in the proposal. We take into consideration a company’s","page_number":223,"box":{"x":69,"y":710,"width":791,"height":11}},{"id":"02b0d6b8-1f3c-4c9b-b625-35e8c3787983","block_type":"box","text":"governance practices and disclosures against those of their peers.","page_number":223,"box":{"x":68,"y":725,"width":475,"height":11}},{"id":"0ac7c24b-13aa-4a59-b509-46a5282c33de","block_type":"box","text":"BIS does not suppor t shareholder proposals that we view as inconsistent with long-term financial value or that","page_number":223,"box":{"x":102,"y":748,"width":787,"height":11}},{"id":"abd49a1c-1333-410f-8561-d84eb5c4ba62","block_type":"box","text":"seek to micromanage companies. We take into consideration the legal effect of the proposal, as shareholder","page_number":223,"box":{"x":69,"y":763,"width":778,"height":11}},{"id":"21f9bdb9-9f61-439e-805c-34d90944e383","block_type":"box","text":"proposals may be advisory or legally binding depending on the jurisdiction, while others may make requests that","page_number":223,"box":{"x":70,"y":778,"width":799,"height":11}},{"id":"89dda301-040c-4f5f-a667-5322ab40a8d9","block_type":"box","text":"would be deemed illegal in a given jurisdiction.","page_number":223,"box":{"x":68,"y":793,"width":331,"height":11}},{"id":"03b68a4c-fd81-41c6-8e9d-1fad985a1731","block_type":"box","text":"In our experience, it is helpful when companies disclose the names of the proponent or organization that has","page_number":223,"box":{"x":102,"y":816,"width":777,"height":11}},{"id":"788d81f2-db39-4819-82ca-2ef419623015","block_type":"box","text":"submitted or advised on the proposal. We recognize that some shareholder proposals bundle topics and/or specific","page_number":223,"box":{"x":69,"y":831,"width":825,"height":11}},{"id":"3640b65f-0a2f-480b-b4f4-00f1515704bb","block_type":"box","text":"requests. Fur ther, the proponent’s suppor ting statement may refer to topics that are not directly related to the","page_number":223,"box":{"x":69,"y":846,"width":788,"height":11}},{"id":"18abccc6-8e41-4d51-af81-8937324c241a","block_type":"box","text":"request made in the proposal. In voting on behalf of clients, we must vote yes or no on the proposal as phrased by","page_number":223,"box":{"x":69,"y":861,"width":820,"height":11}},{"id":"3544835c-ff10-4a84-9f1b-bfb1726783cd","block_type":"box","text":"the proponent. Therefore, when we vote in suppor t of a proposal, we are not necessarily endorsing every element of","page_number":223,"box":{"x":68,"y":876,"width":831,"height":11}},{"id":"2e6a28aa-2cd9-4c53-b040-a1bc301f0dd8","block_type":"box","text":"9","page_number":223,"box":{"x":69,"y":906,"width":4,"height":4}},{"id":"ccaeb0da-b0a2-4849-9948-465c2d14b4a2","block_type":"box","text":"Corporate form refers to the legal structure by which a business is organized.","page_number":223,"box":{"x":79,"y":905,"width":550,"height":12}},{"id":"dd1ee990-f3cf-4d54-b79d-5cc46c26e030","block_type":"box","text":"BlackRock Investment Stewardship","page_number":223,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"f8c6d5b7-0d50-450a-acdc-423cdb8fa47a","block_type":"box","text":"Global Principles | 9","page_number":223,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"af2c066a-4226-46f2-bfc0-ac138e2a6967","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":223,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"15e1795b-8518-4aef-bb9c-402326da636f","block_type":"box","text":"the proposal or the reasoning, objectives, or suppor ting statement of the proponent. We may suppor t a proposal for","page_number":224,"box":{"x":68,"y":45,"width":829,"height":11}},{"id":"547ade4a-97f7-401a-bf7e-1c459aa5f353","block_type":"box","text":"different reasons than those put for th by the proponent, when we believe that overall it may advance our clients’","page_number":224,"box":{"x":69,"y":60,"width":802,"height":11}},{"id":"d42ec023-e609-45bf-b729-a52e4caa6524","block_type":"box","text":"long-term financial interests.","page_number":224,"box":{"x":70,"y":75,"width":201,"height":11}},{"id":"95fcb132-ad7a-4cd1-91a3-6e70df67dcae","block_type":"box","text":"BlackRock is subject to cer tain rules, regulations, agency guidance, and contractual agreements that place","page_number":224,"box":{"x":102,"y":98,"width":763,"height":11}},{"id":"63b30f64-fc8a-44b8-98e3-86283d7422dc","block_type":"box","text":"restrictions and limitations on how BlackRock can interact with the companies in which we invest on behalf of our","page_number":224,"box":{"x":69,"y":113,"width":809,"height":11}},{"id":"989591a2-2eff-4b1e-a24c-240d0c4fe2a4","block_type":"box","text":"clients. BlackRock does not nominate directors for board elections or submit shareholder proposals to companies.","page_number":224,"box":{"x":69,"y":128,"width":817,"height":11}},{"id":"94c05884-e19d-48c9-b6d3-bca87f73a22b","block_type":"box","text":"Non-compliance with these requirements could adversely affect BlackRock’s ability to serve its clients’ interests.","page_number":224,"box":{"x":70,"y":143,"width":803,"height":11}},{"id":"3a3da6eb-580f-4734-8fe9-70201c3e1d50","block_type":"box","text":"MATERIAL SUSTAINABILITY-RELATED RISKS AND OPPORTUNITIES","page_number":224,"box":{"x":247,"y":173,"width":484,"height":9}},{"id":"5e8fbb04-85c7-478c-93bb-b4ebaf1d448d","block_type":"box","text":"Appropriate oversight of material risks and oppor tunities, including material sustainability-related risks and","page_number":224,"box":{"x":101,"y":196,"width":760,"height":11}},{"id":"df669531-032f-40c2-8aee-e0e9b4f73b09","block_type":"box","text":"oppor tunities, is an impor tant component of having an effective governance framework that suppor ts durable, long","page_number":224,"box":{"x":69,"y":211,"width":824,"height":11}},{"id":"96d45b54-59a5-48cc-8065-257db0fdeffe","block_type":"box","text":"term financial value creation.","page_number":224,"box":{"x":68,"y":226,"width":206,"height":9}},{"id":"c9383663-ab9f-4193-9c5f-534ba89b5659","block_type":"box","text":"10","page_number":224,"box":{"x":276,"y":226,"width":9,"height":5}},{"id":"90a547fb-230c-43eb-a6f2-fb09d69a2ffd","block_type":"box","text":"We look to companies to provide robust disclosure that allows investors to effectively evaluate companies’","page_number":224,"box":{"x":101,"y":249,"width":761,"height":11}},{"id":"0979f997-39b1-4d2d-b614-4acbea73563f","block_type":"box","text":"strategy and business practices related to material sustainability-related risks and oppor tunities. We find it helpful","page_number":224,"box":{"x":69,"y":264,"width":814,"height":11}},{"id":"71e19493-49af-4417-8376-af2c8b5cb124","block_type":"box","text":"when companies’ disclosures demonstrate that they have a resilient business model that integrates material","page_number":224,"box":{"x":68,"y":279,"width":777,"height":11}},{"id":"6d418beb-462a-4f81-9050-c70848f1b381","block_type":"box","text":"sustainability-related risks and oppor tunities into their strategy, risk management, and metrics and targets, including","page_number":224,"box":{"x":69,"y":294,"width":833,"height":11}},{"id":"88bb85b9-4798-4919-9bd2-a8441377e62d","block_type":"box","text":"industry-specific metrics.","page_number":224,"box":{"x":70,"y":309,"width":175,"height":11}},{"id":"96e2ab73-4498-4bf6-81ae-a24d8bd40655","block_type":"box","text":"Standardized disclosure of sustainability-related data suppor ts investors in making informed decisions. The","page_number":224,"box":{"x":102,"y":332,"width":765,"height":11}},{"id":"6c51bf6d-4a17-4d1b-9e0a-47a2438ded71","block_type":"box","text":"International Sustainability Standards Board (ISSB) standards, IFRS S1 and S2, represent one such approach to","page_number":224,"box":{"x":70,"y":347,"width":800,"height":11}},{"id":"e4c98000-f0b9-4d69-b270-a45f6174332c","block_type":"box","text":"standardization that we find useful in our analysis.","page_number":224,"box":{"x":69,"y":362,"width":358,"height":11}},{"id":"276679dc-bc35-4650-ab36-9412e7aab794","block_type":"box","text":"11","page_number":224,"box":{"x":429,"y":363,"width":9,"height":4}},{"id":"0d320d30-8673-48dc-a4fc-ea2a60cfc2bf","block_type":"box","text":"However, we do not mandate any specific disclosure framework","page_number":224,"box":{"x":444,"y":362,"width":451,"height":11}},{"id":"89c93e09-6e3a-4876-9c2d-988f6787c382","block_type":"box","text":"companies should use, and recognize that companies may repor t using different standards, some of which may be","page_number":224,"box":{"x":69,"y":377,"width":821,"height":12}},{"id":"686ae136-4096-4b65-8e12-fa80304ae228","block_type":"box","text":"required by regulation. In such cases, we ask that companies highlight the metrics that are industry- or company","page_number":224,"box":{"x":69,"y":393,"width":806,"height":11}},{"id":"5866a7f0-71cb-40ee-b985-05e329a3b840","block_type":"box","text":"specific.","page_number":224,"box":{"x":69,"y":407,"width":57,"height":11}},{"id":"1a33e39e-eb3d-40d9-8fd4-f3d7fc8dcbd2","block_type":"box","text":"We also recognize that companies may be phasing in repor ting over several years. We do not prescribe timelines","page_number":224,"box":{"x":101,"y":430,"width":805,"height":11}},{"id":"234cb98b-84ed-47e1-9307-ef1d96c48303","block_type":"box","text":"regarding when companies should make sustainability-related disclosures but appreciate it when companies produce","page_number":224,"box":{"x":69,"y":446,"width":833,"height":11}},{"id":"c0116368-fdf8-408c-8bb0-336c19889d27","block_type":"box","text":"them sufficiently in advance of their shareholder meeting, to the best of their abilities, to provide investors with time","page_number":224,"box":{"x":68,"y":460,"width":830,"height":12}},{"id":"926e20ea-a91a-49eb-9751-9894d8f4e896","block_type":"box","text":"to assess the data and make informed voting decisions.","page_number":224,"box":{"x":68,"y":475,"width":401,"height":12}},{"id":"cd7f63e4-0518-4770-8d8c-98a8eaf9f7a4","block_type":"box","text":"Industry initiatives on managing specific operational risks may also provide useful guidance to companies on","page_number":224,"box":{"x":102,"y":498,"width":775,"height":11}},{"id":"9e0900d2-82cf-47ba-b7bc-0f732381fa87","block_type":"box","text":"best practices and disclosures. While not a voting item, we find it helpful to our understanding of investment risk","page_number":224,"box":{"x":69,"y":513,"width":804,"height":12}},{"id":"6a5cf032-9016-4715-a688-e9521e4a9898","block_type":"box","text":"when companies disclose any relevant global sustainability-related standards adopted, the industry initiatives in","page_number":224,"box":{"x":68,"y":529,"width":799,"height":11}},{"id":"d6a9553d-b7e7-45a6-99f4-178f1bca5f0c","block_type":"box","text":"which they par ticipate, any peer group benchmarking under taken, and any assurance processes to help investors","page_number":224,"box":{"x":68,"y":544,"width":810,"height":11}},{"id":"6b7d2736-eceb-4b78-b73f-cacb331e7fdd","block_type":"box","text":"understand their approach to sustainable and responsible business practices.","page_number":224,"box":{"x":69,"y":559,"width":556,"height":11}},{"id":"f962d192-4161-4a37-9f21-8183b9c13856","block_type":"box","text":"10","page_number":224,"box":{"x":69,"y":603,"width":9,"height":5}},{"id":"3b28e733-96f6-4d9a-bd10-f352efa30ebc","block_type":"box","text":"By material sustainability-related risks and oppor tunities, we mean the drivers of risk and financial value creation in","page_number":224,"box":{"x":84,"y":603,"width":822,"height":11}},{"id":"7e631d76-12c8-42f9-8430-2e8ba850904a","block_type":"box","text":"a company’s business model that have an environmental or social dependency or impact. Examples of environmental","page_number":224,"box":{"x":69,"y":618,"width":835,"height":11}},{"id":"830c6acd-5401-413e-a941-a20ceb1b2919","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":224,"box":{"x":70,"y":633,"width":827,"height":12}},{"id":"b9d9ba18-d16f-4f20-83bb-6d05298f58c8","block_type":"box","text":"issues include, but are not limited to, human capital management, impacts on the communities in which a company","page_number":224,"box":{"x":70,"y":649,"width":826,"height":11}},{"id":"865f2c00-d101-4e4e-abc9-9ea024465d2a","block_type":"box","text":"operates, customer loyalty, and relationships with regulators.","page_number":224,"box":{"x":69,"y":664,"width":433,"height":11}},{"id":"4425767a-8181-44b7-aa4f-ad8aa9811190","block_type":"box","text":"11","page_number":224,"box":{"x":69,"y":682,"width":9,"height":4}},{"id":"f7825e71-3c63-4c01-9282-634b9b1e55a4","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Repor ting Standards","page_number":224,"box":{"x":83,"y":681,"width":744,"height":11}},{"id":"6dc849ca-2a89-4aea-ab21-9d11462362c1","block_type":"box","text":"(IFRS) Foundation. The standards build on the Task Force on Climate-related Financial Disclosures (TCFD) framework","page_number":224,"box":{"x":69,"y":696,"width":828,"height":11}},{"id":"118c234e-a649-4e96-94c9-1256d2ba9a1f","block_type":"box","text":"and the standards and metrics developed by the Sustainability Accounting Standards Board (SASB), which have both","page_number":224,"box":{"x":69,"y":711,"width":830,"height":12}},{"id":"40463b10-690f-4c50-b2c2-aa99e0012bf1","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":224,"box":{"x":69,"y":726,"width":809,"height":12}},{"id":"85602967-b898-4b41-b785-5e34cd0b9317","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":224,"box":{"x":70,"y":742,"width":778,"height":11}},{"id":"a9ff35d9-62f6-4bad-9ac6-ecc4df225a71","block_type":"box","text":"Disclosures.” Websites accessed in December 2025.","page_number":224,"box":{"x":70,"y":757,"width":380,"height":9}},{"id":"e263e245-d87f-4043-abde-f6728d744865","block_type":"box","text":"BlackRock Investment Stewardship","page_number":224,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"6cf638fa-5e23-4da4-8256-58e03ecede31","block_type":"box","text":"Global Principles | 10","page_number":224,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"a8553ec6-84d3-4feb-b3d7-7eb2c282c835","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":224,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"56f94760-0604-4195-8edf-2c12ec1790da","block_type":"box","text":"CLIMATE AND NATURE-RELATED RISK","page_number":225,"box":{"x":351,"y":45,"width":277,"height":9}},{"id":"bb30f392-c8b1-447a-a9d2-0a4f8f335ab3","block_type":"box","text":"Many companies are assessing how to navigate the low-carbon transition while delivering long-term financial","page_number":225,"box":{"x":102,"y":67,"width":769,"height":12}},{"id":"cbb49b6c-0d28-41e2-80e2-2350334dea46","block_type":"box","text":"value to investors. For companies facing material climate-related risks, we find it helpful when they publicly disclose,","page_number":225,"box":{"x":68,"y":82,"width":829,"height":12}},{"id":"9a9fb2c8-59ae-4369-b786-a26d1bd0549d","block_type":"box","text":"consistent with their business model and sector, how they intend to deliver long-term financial per formance through","page_number":225,"box":{"x":69,"y":98,"width":824,"height":11}},{"id":"50d01712-d312-42ba-b6e1-8447b34e445d","block_type":"box","text":"the low-carbon transition, including where available, their transition plan.","page_number":225,"box":{"x":68,"y":113,"width":514,"height":11}},{"id":"4d4726e0-463a-4453-8f91-df02b884512b","block_type":"box","text":"12, 13","page_number":225,"box":{"x":584,"y":113,"width":26,"height":5}},{"id":"dd5160e0-c010-424e-be25-57c0ea4296b1","block_type":"box","text":"From company disclosures and","page_number":225,"box":{"x":617,"y":113,"width":218,"height":11}},{"id":"e48dce57-788d-4fcf-8faf-b42d91663af1","block_type":"box","text":"engagement, we seek to understand the strategies companies have in place to manage material risks to, and","page_number":225,"box":{"x":69,"y":128,"width":782,"height":11}},{"id":"1c6bc6f6-2563-4bc0-b075-4ef4b556d47f","block_type":"box","text":"oppor tunities for, their long-term business model associated with a range of climate-related scenarios.","page_number":225,"box":{"x":69,"y":143,"width":729,"height":11}},{"id":"35ea3f1f-a116-445d-82e1-a5f5a517ccc0","block_type":"box","text":"Recognizing the value of these disclosures, cer tain markets such as the European Union mandate large","page_number":225,"box":{"x":102,"y":166,"width":740,"height":11}},{"id":"2f709a4b-5bd4-4968-a75a-28f3a848c519","block_type":"box","text":"companies to disclose such climate-related financial information, while in other jurisdictions these disclosures are","page_number":225,"box":{"x":69,"y":181,"width":814,"height":11}},{"id":"b63e554c-0c54-4085-970d-a4a794fb70f5","block_type":"box","text":"viewed as best practice in the market.","page_number":225,"box":{"x":68,"y":196,"width":271,"height":11}},{"id":"b0bb827f-100b-4e0f-9350-40dd5a4279a5","block_type":"box","text":"The ISSB standards provide one such framework that can assist investors in assessing company-specific","page_number":225,"box":{"x":101,"y":218,"width":749,"height":12}},{"id":"a6b96021-94d6-49f4-bc41-d0858f237588","block_type":"box","text":"climate-related risks and oppor tunities, and informing investment decisions. Such disclosures also provide investors","page_number":225,"box":{"x":69,"y":234,"width":831,"height":11}},{"id":"9cbc638b-8dad-419f-ba7c-4883ab117b42","block_type":"box","text":"with insights into how companies are managing the risks associated with a transition to a low-carbon economy by","page_number":225,"box":{"x":68,"y":249,"width":809,"height":11}},{"id":"e40d9141-9371-47f0-a96b-eaec89e10435","block_type":"box","text":"managing their own carbon emissions or emissions intensities to the extent financially practicable.","page_number":225,"box":{"x":69,"y":264,"width":702,"height":11}},{"id":"984dc9a2-5c36-449d-9487-f759410bd19f","block_type":"box","text":"The ISSB standards, for example, contemplate disclosures on how companies are setting shor t-, medium- and","page_number":225,"box":{"x":101,"y":286,"width":786,"height":12}},{"id":"35f20d1b-af2d-40cd-b57e-9d8e8c5d0363","block_type":"box","text":"long-term targets, ideally science-based where these are available for their sector, for scope 1 and 2 greenhouse gas","page_number":225,"box":{"x":70,"y":302,"width":834,"height":11}},{"id":"8ee459f6-f66a-47c1-be86-df051ac959ab","block_type":"box","text":"emissions (GHG) reductions and to demonstrate how their targets are consistent with the long-term financial","page_number":225,"box":{"x":69,"y":317,"width":773,"height":11}},{"id":"e4fe1421-9ff7-4b8e-b4f4-b0f5c9ee9163","block_type":"box","text":"interests of their investors.","page_number":225,"box":{"x":70,"y":332,"width":190,"height":9}},{"id":"4af95e4e-f683-4645-ae44-d21e5ec57f4e","block_type":"box","text":"While we recognize that regulators in some markets are moving to mandate cer tain disclosures, at this stage,","page_number":225,"box":{"x":101,"y":355,"width":784,"height":11}},{"id":"828199bc-f5ba-4b01-9317-97f9ef0b2132","block_type":"box","text":"we view scope 3 emissions differently from scopes 1 and 2, given methodological complexity, regulatory uncer tainty,","page_number":225,"box":{"x":68,"y":370,"width":832,"height":11}},{"id":"4d197604-b626-4500-85d9-7440a6a48aa9","block_type":"box","text":"concerns about double-counting, and lack of direct control by companies. We welcome disclosures and commitments","page_number":225,"box":{"x":69,"y":385,"width":834,"height":11}},{"id":"fd388031-f05d-43a6-acc0-a6795689cd18","block_type":"box","text":"that companies choose to make regarding material scope 3 emissions and recognize that these are provided on a","page_number":225,"box":{"x":68,"y":400,"width":815,"height":11}},{"id":"925a929a-5fe4-4e98-80dc-c25b0d0b3332","block_type":"box","text":"good-faith basis as methodology develops.","page_number":225,"box":{"x":68,"y":415,"width":303,"height":11}},{"id":"7cec0247-31b1-4f72-a05c-325f1482fbe1","block_type":"box","text":"In addition to climate-related risks and oppor tunities, for companies whose strategies, operations or supply","page_number":225,"box":{"x":102,"y":438,"width":766,"height":11}},{"id":"a928e408-119b-4433-b389-3c4369c43df3","block_type":"box","text":"chains are materially reliant on natural capital, nature-related risks and oppor tunities may affect their ability to","page_number":225,"box":{"x":69,"y":453,"width":788,"height":11}},{"id":"9092c806-60d5-4c90-91b4-d990c7d9afad","block_type":"box","text":"generate long-term financial returns.","page_number":225,"box":{"x":68,"y":468,"width":258,"height":11}},{"id":"ba3bdbae-ddd5-425a-a8c5-a0f7e855ec8b","block_type":"box","text":"14","page_number":225,"box":{"x":328,"y":468,"width":9,"height":5}},{"id":"2a7ba19a-8a20-4f02-b09b-1a8287c45a32","block_type":"box","text":"For these companies, we rely on disclosures to understand how their","page_number":225,"box":{"x":344,"y":468,"width":490,"height":11}},{"id":"da051387-a201-46d6-a005-2c91314c723f","block_type":"box","text":"strategies consider nature-related impacts and dependencies and to assess how the board oversees these risks.","page_number":225,"box":{"x":69,"y":483,"width":807,"height":11}},{"id":"0178e507-9801-40d7-a4f5-92bfc86bd0fc","block_type":"box","text":"15","page_number":225,"box":{"x":878,"y":484,"width":9,"height":4}},{"id":"fb00207e-2f06-4016-9d09-2e03184c88f3","block_type":"box","text":"COMPANIES’ IMPACT ON THEIR WORKFORCE, SUPPLY CHAINS, AND COMMUNITIES","page_number":225,"box":{"x":179,"y":513,"width":620,"height":11}},{"id":"e15e53ab-a087-4c1c-aa40-a4194a1e6596","block_type":"box","text":"Companies determine their key stakeholders based on what is material to their business and long-term financial","page_number":225,"box":{"x":102,"y":536,"width":799,"height":11}},{"id":"89a93c42-0bfb-4a27-8b6c-5889ff6d0598","block_type":"box","text":"per formance. For many companies, key stakeholders include employees, business supply chains, clients and","page_number":225,"box":{"x":70,"y":551,"width":778,"height":11}},{"id":"969a143a-3f96-4652-b445-26414a2f0358","block_type":"box","text":"consumers, regulators, and the communities in which they operate.","page_number":225,"box":{"x":69,"y":566,"width":479,"height":11}},{"id":"a614f850-a6e2-401c-a69e-11e1dc637e2a","block_type":"box","text":"In our experience, companies that invest in the relationships that are critical to their strategic objectives are","page_number":225,"box":{"x":102,"y":589,"width":770,"height":11}},{"id":"e51b9b44-f059-4b00-8a41-88a5519f37c6","block_type":"box","text":"more likely to deliver durable, long-term financial per formance. By contrast, we have found that poor relationships","page_number":225,"box":{"x":69,"y":604,"width":810,"height":11}},{"id":"b8d59179-19ff-415c-8cfb-bf023d54c97f","block_type":"box","text":"12","page_number":225,"box":{"x":69,"y":634,"width":9,"height":4}},{"id":"967a9ff0-73f9-47bd-940b-0f87706c2e83","block_type":"box","text":"We have observed that more companies are developing such plans, and public policymakers in cer tain markets are","page_number":225,"box":{"x":83,"y":633,"width":823,"height":12}},{"id":"f7dc206a-695a-47cc-ac04-5e421130dd2a","block_type":"box","text":"signaling their intentions to require them or already have requirements in place, such as Australia, Brazil, and the","page_number":225,"box":{"x":69,"y":649,"width":808,"height":11}},{"id":"9792d180-1318-43da-abe9-f4ffaecb4316","block_type":"box","text":"European Union (please see the International Transition Plan Network for information). We view transition plans as a","page_number":225,"box":{"x":70,"y":663,"width":827,"height":11}},{"id":"f3cdb7ed-1fb0-4cd2-abce-6ade44c23444","block_type":"box","text":"method for a company to both internally assess and externally communicate its long-term strategy, ambition,","page_number":225,"box":{"x":69,"y":679,"width":774,"height":11}},{"id":"1f414af5-f7aa-4e46-9eb8-78086caef775","block_type":"box","text":"objectives, and actions to create financial value through the global transition towards a low-carbon economy. Across","page_number":225,"box":{"x":69,"y":694,"width":825,"height":11}},{"id":"371cfbc0-be39-4309-b42b-7155f694e93c","block_type":"box","text":"the landscape there remains divergence on the objectives of such plans and the details they should contain. While","page_number":225,"box":{"x":68,"y":709,"width":819,"height":11}},{"id":"0032ab5c-4f36-483b-b1ed-6895b24ef7ba","block_type":"box","text":"transition plans can be helpful disclosure, BIS does not make the preparation and production of transition plans a","page_number":225,"box":{"x":68,"y":724,"width":813,"height":11}},{"id":"d5a7cb95-5753-4e60-9d84-5de73db47af6","block_type":"box","text":"voting issue. BIS may engage companies that have chosen to publish a transition plan to understand their planned","page_number":225,"box":{"x":68,"y":739,"width":819,"height":11}},{"id":"832684fc-6993-48c7-9192-b9e4fe6e8543","block_type":"box","text":"actions and resource implications. Website accessed in December 2025.","page_number":225,"box":{"x":69,"y":754,"width":522,"height":11}},{"id":"d6abae31-f13e-4b2b-aaeb-b7078196546d","block_type":"box","text":"13","page_number":225,"box":{"x":69,"y":772,"width":9,"height":5}},{"id":"744f5b56-a8b5-46c2-8c0e-91da673dfb80","block_type":"box","text":"For more information, please see our commentary “Climate-related risks and a low-carbon transition,” December","page_number":225,"box":{"x":84,"y":772,"width":804,"height":11}},{"id":"51187206-ac7d-4504-a5bd-3c1e0430c54e","block_type":"box","text":"2025.","page_number":225,"box":{"x":69,"y":787,"width":42,"height":9}},{"id":"f77843d5-4c33-4a99-baf8-86bbe2825031","block_type":"box","text":"14","page_number":225,"box":{"x":69,"y":805,"width":9,"height":4}},{"id":"5f1945ed-479b-4f75-84cd-ce31b249dcbe","block_type":"box","text":"For more information, please see our commentary “Our approach to engagement on natural capital,” December","page_number":225,"box":{"x":84,"y":805,"width":796,"height":11}},{"id":"d195df87-5026-4226-9ab6-397b0725df58","block_type":"box","text":"2025.","page_number":225,"box":{"x":69,"y":820,"width":42,"height":9}},{"id":"a05a0259-1749-4a7b-b887-301c1a3a9b59","block_type":"box","text":"15","page_number":225,"box":{"x":69,"y":838,"width":9,"height":4}},{"id":"86205f71-5744-4f2e-bfd7-67e81c455e09","block_type":"box","text":"Given the growing awareness of the materiality of these issues for cer tain businesses, enhanced repor ting on a","page_number":225,"box":{"x":84,"y":837,"width":797,"height":12}},{"id":"9fd15cf9-07b9-4b58-a22f-ac4b6d22a4f1","block_type":"box","text":"company’s natural capital dependencies and impacts would aid investors’ understanding. The recommendations of","page_number":225,"box":{"x":69,"y":852,"width":820,"height":12}},{"id":"aff5645a-5f72-44e9-a9a3-65f24216d868","block_type":"box","text":"the Taskforce on Nature-related Financial Disclosures (TNFD) may prove useful to some companies. We recognize that","page_number":225,"box":{"x":68,"y":868,"width":842,"height":11}},{"id":"f1643b09-a496-4364-856e-452c4cb46f66","block_type":"box","text":"some companies may repor t using different standards, which may be required by regulation, or one of a number of","page_number":225,"box":{"x":69,"y":883,"width":820,"height":11}},{"id":"93133a53-c61c-4139-9225-2ca96b9bb06e","block_type":"box","text":"other private sector standards. TNFD-aligned repor ting is not a voting issue. Website accessed in December 2025.","page_number":225,"box":{"x":69,"y":898,"width":817,"height":11}},{"id":"3adaeef0-2be8-487c-984f-a784bbf12826","block_type":"box","text":"BlackRock Investment Stewardship","page_number":225,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"3018a39e-9910-4921-9643-43bd0d4e58ff","block_type":"box","text":"Global Principles | 11","page_number":225,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"c1352f3d-37e1-4413-823f-7d618839fe4c","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":225,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"ff86f3ac-f1c4-4fdb-8c2c-100c86e7512a","block_type":"box","text":"may create adverse impacts that could expose companies to legal, regulatory, operational, and reputational risks.","page_number":226,"box":{"x":69,"y":45,"width":811,"height":11}},{"id":"59a17444-53c6-40ef-b8c3-3b48ad5001a4","block_type":"box","text":"This is par ticularly relevant to a company’s workforce, which is central to long-term financial value creation.","page_number":226,"box":{"x":68,"y":60,"width":764,"height":11}},{"id":"c9b32bb7-9daa-449c-bb95-98d8b35524f8","block_type":"box","text":"16","page_number":226,"box":{"x":834,"y":60,"width":9,"height":5}},{"id":"7de7a379-5744-415d-8c06-6c1c6540e28e","block_type":"box","text":"As a long-term shareholder on behalf of our clients, we find it helpful when companies disclose how they have","page_number":226,"box":{"x":101,"y":82,"width":783,"height":12}},{"id":"5acd7eec-4d83-47f2-8b85-299d1a338815","block_type":"box","text":"identified their key stakeholders and considered their interests in business decision-making. In addition to","page_number":226,"box":{"x":70,"y":98,"width":755,"height":11}},{"id":"23096eca-2739-43af-bdbb-22eab2c8c1a9","block_type":"box","text":"understanding broader stakeholder relationships, BIS finds it helpful when companies discuss how they consider the","page_number":226,"box":{"x":69,"y":113,"width":831,"height":11}},{"id":"55db2fc1-f6a4-4716-8f0c-a803b3afd6b3","block_type":"box","text":"needs of their workforce today, and the skills required for their future business strategy. We are also interested in","page_number":226,"box":{"x":69,"y":128,"width":809,"height":11}},{"id":"809f4943-21e3-4a5a-8d68-24cd3d2b75bc","block_type":"box","text":"understanding how the board monitors and engages on these matters, given it is well positioned to ensure that the","page_number":226,"box":{"x":69,"y":143,"width":821,"height":11}},{"id":"c60f43ef-9da8-43b1-81fe-2031262c1719","block_type":"box","text":"approach taken by management is informed by and aligns with the company’s strategy. BIS does not direct a","page_number":226,"box":{"x":69,"y":158,"width":775,"height":11}},{"id":"ca44b7ef-5785-4b11-879d-e60790cd13fe","block_type":"box","text":"company’s policies or practices, which are the responsibility of management and the board.","page_number":226,"box":{"x":69,"y":173,"width":653,"height":11}},{"id":"ae7afe58-a30c-4240-b9d7-19210386620b","block_type":"box","text":"In addition, we find it helpful when companies disclose their approach to addressing material adverse impacts","page_number":226,"box":{"x":102,"y":196,"width":784,"height":11}},{"id":"ce7201e8-3cdd-4112-b1a4-904adf2b7aa6","block_type":"box","text":"that could arise from their business practices and affect critical relationships with their stakeholders. We encourage","page_number":226,"box":{"x":68,"y":211,"width":829,"height":11}},{"id":"57f286bd-ebd5-4840-a98a-5cdd8274246f","block_type":"box","text":"companies to implement, to the extent appropriate, monitoring processes (often referred to as due diligence) to","page_number":226,"box":{"x":69,"y":226,"width":797,"height":11}},{"id":"04b1b576-1160-4c31-b8e8-23de708e7b88","block_type":"box","text":"identify and mitigate potential adverse impacts and grievance mechanisms to remediate any actual adverse material","page_number":226,"box":{"x":70,"y":241,"width":828,"height":11}},{"id":"a5bd8e4b-ca23-4079-976c-218490e16e0a","block_type":"box","text":"impacts.","page_number":226,"box":{"x":70,"y":257,"width":58,"height":10}},{"id":"21dc50a0-0d94-427f-8fef-b58d487814d2","block_type":"box","text":"We look to boards to oversee management’s approach to addressing material risks related to key stakeholders","page_number":226,"box":{"x":101,"y":279,"width":794,"height":11}},{"id":"06d1fade-6b8b-4d7f-b078-1b8922cd4b2b","block_type":"box","text":"and may convey concerns about board oversight in our voting on director elections or suppor ting a business relevant","page_number":226,"box":{"x":69,"y":294,"width":831,"height":11}},{"id":"b4b4ac73-3ff9-47e6-b160-a3ffe590ec93","block_type":"box","text":"shareholder proposal when, in our assessment, the board is not acting in shareholders’ long-term financial interests.","page_number":226,"box":{"x":69,"y":309,"width":834,"height":11}},{"id":"cf90b379-5e1b-4285-887b-b26f848bb068","block_type":"box","text":"BLACKROCK’S OVERSIGHT OF ITS INVESTMENT STEWARDSHIP ACTIVITIES","page_number":226,"box":{"x":213,"y":340,"width":553,"height":8}},{"id":"e6945a72-e6f1-4780-bcfd-041c097d3f62","block_type":"box","text":"BIS’ governance structure suppor ts oversight and accountability of stewardship-related activities on behalf of","page_number":226,"box":{"x":102,"y":362,"width":778,"height":11}},{"id":"7c0ce949-0efd-432a-9b1f-1a0eca884e6d","block_type":"box","text":"clients at the global and regional level.","page_number":226,"box":{"x":69,"y":377,"width":274,"height":12}},{"id":"be174e83-eb6f-46c1-afd5-9322a50c38ef","block_type":"box","text":"At the top of this governance structure, the risk-focused BIS Global Oversight Committee (the Committee)","page_number":226,"box":{"x":101,"y":400,"width":751,"height":11}},{"id":"fb0ae56d-b95b-4c66-9ca3-ffb3e23abd98","block_type":"box","text":"suppor ts BIS’ regulatory responsibilities in relation to proxy voting, including adherence to policies and procedures as","page_number":226,"box":{"x":69,"y":415,"width":840,"height":11}},{"id":"a158aa04-0a58-4d0b-b5bd-2ff619101008","block_type":"box","text":"well as market-level stewardship requirements. The Committee reviews and approves amendments to the Global","page_number":226,"box":{"x":68,"y":430,"width":802,"height":11}},{"id":"7b003c29-8181-46c1-bdd5-82afc8321bcc","block_type":"box","text":"Principles and regional voting guidelines. The Committee also reviews periodic repor ts regarding the votes cast by","page_number":226,"box":{"x":69,"y":445,"width":813,"height":12}},{"id":"aeb0f13e-9199-44d5-b10b-e394e55034aa","block_type":"box","text":"BIS on behalf of clients, as well as updates on material process issues, procedural changes, and other risk oversight","page_number":226,"box":{"x":70,"y":460,"width":835,"height":12}},{"id":"d611145b-b6ef-4e8b-be94-54d15b15bfb1","block_type":"box","text":"considerations. The Committee is chaired by the Global Heads of the Investment Stewardship function and its","page_number":226,"box":{"x":69,"y":475,"width":783,"height":12}},{"id":"2c5c8897-1a23-4bc7-8448-026638a44429","block_type":"box","text":"members include senior BlackRock executives with legal, risk, and other experience relevant to team oversight who","page_number":226,"box":{"x":69,"y":491,"width":820,"height":11}},{"id":"2d937552-644a-446c-bee5-e84476c0b5e7","block_type":"box","text":"are independent from the investment stewardship function.","page_number":226,"box":{"x":69,"y":506,"width":421,"height":11}},{"id":"9eee2bfa-8fb1-4b81-94df-08a358a37e9d","block_type":"box","text":"The Global Heads have primary oversight of BIS’ activities globally, including voting in accordance with the Global","page_number":226,"box":{"x":101,"y":528,"width":804,"height":12}},{"id":"a98cb0a1-d2cc-494f-80bd-33c5d917769f","block_type":"box","text":"Principles and regional voting guidelines. At the regional level, three regional Heads for the Americas, APAC, and","page_number":226,"box":{"x":69,"y":543,"width":798,"height":12}},{"id":"8e86c556-52ae-44ef-a3aa-08f166e19b8a","block_type":"box","text":"EMEA oversee BIS’ activities for their specific markets.","page_number":226,"box":{"x":70,"y":559,"width":389,"height":11}},{"id":"db425d02-3a27-442d-903e-d1253f094998","block_type":"box","text":"VOTE EXECUTION","page_number":226,"box":{"x":424,"y":589,"width":129,"height":9}},{"id":"2f62a121-e06b-4595-92a5-4a6485cce61c","block_type":"box","text":"BIS votes proxies on behalf of index equity funds and accounts when authorized by our clients. We have","page_number":226,"box":{"x":102,"y":612,"width":739,"height":11}},{"id":"80db9a72-0050-4fc8-a78a-9c5054852820","block_type":"box","text":"processes in place to consider all proxies for which we have voting authority, and submit voting decisions, or refrain","page_number":226,"box":{"x":70,"y":627,"width":822,"height":11}},{"id":"13ed415e-17a7-420a-b4fa-daf605dc7b53","block_type":"box","text":"from voting when logistical issues arise (see below). The BIS Benchmark Policies – and the vote decisions made","page_number":226,"box":{"x":68,"y":642,"width":801,"height":11}},{"id":"0cf36345-53d7-4581-a627-4ff38d85c05e","block_type":"box","text":"consistent with those policies – reflect our reasonable and independent judgment and are made without regard to the","page_number":226,"box":{"x":69,"y":657,"width":838,"height":11}},{"id":"5811c563-2df2-4b4f-9c3c-73c22124bb38","block_type":"box","text":"relationship between the issuer of the proxy (or any shareholder proponent or dissident shareholder) and the Fund,","page_number":226,"box":{"x":69,"y":672,"width":817,"height":11}},{"id":"31fc6b69-674c-4e5b-82fe-a81cde6e80c1","block_type":"box","text":"the Fund’s affiliates (if any), BlackRock or BlackRock’s affiliates, or BlackRock employees (see “Conflicts","page_number":226,"box":{"x":68,"y":687,"width":751,"height":11}},{"id":"f8504481-fc83-4e2d-8006-d33e7df46e5c","block_type":"box","text":"management policies and procedures,” below).","page_number":226,"box":{"x":69,"y":703,"width":334,"height":11}},{"id":"48cbed9f-4430-47f0-8a66-4680c7f48e77","block_type":"box","text":"In cer tain markets, proxy voting involves logistical issues which can affect BIS’ ability to vote, as well as the cost","page_number":226,"box":{"x":102,"y":725,"width":806,"height":11}},{"id":"a3a4c609-4b75-43b7-8179-63434fca61d7","block_type":"box","text":"of voting such proxies on behalf of our clients. These issues include, but are not limited to: 1) untimely notice of","page_number":226,"box":{"x":69,"y":740,"width":801,"height":11}},{"id":"91a82709-236a-4ac8-8ba9-686c87d11ae4","block_type":"box","text":"shareholder meetings; 2) restrictions on a foreigner’s ability to exercise votes; 3) requirements to vote proxies in","page_number":226,"box":{"x":69,"y":755,"width":805,"height":11}},{"id":"d69c0d80-e2dc-4dd2-83f9-b997ec4bec0b","block_type":"box","text":"person; 4) “share-blocking” (requirements that investors who exercise their voting rights surrender the right to","page_number":226,"box":{"x":70,"y":771,"width":783,"height":11}},{"id":"a36df536-4263-4cd4-89dd-7fce6b5a9bcc","block_type":"box","text":"dispose of their holdings from the point at which votes are submitted until after the after the shareholder meeting","page_number":226,"box":{"x":69,"y":785,"width":811,"height":12}},{"id":"8325f6f9-80e1-4723-beaa-dc3bef240c54","block_type":"box","text":"has occurred); 5) potential difficulties in translating the proxy; 6) regulatory constraints; and 7) requirements to","page_number":226,"box":{"x":69,"y":801,"width":795,"height":11}},{"id":"d4568581-1380-440d-a524-dd134ce81f1c","block_type":"box","text":"provide local agents with powers of attorney to facilitate voting instructions. We are not suppor tive of impediments to","page_number":226,"box":{"x":70,"y":816,"width":835,"height":11}},{"id":"64573dfe-5387-417f-b067-9d33b217b3ea","block_type":"box","text":"the exercise of voting rights such as share-blocking or overly burdensome administrative requirements.","page_number":226,"box":{"x":68,"y":831,"width":732,"height":11}},{"id":"44bcc228-6a69-4e52-977e-655eef1fccde","block_type":"box","text":"16","page_number":226,"box":{"x":69,"y":860,"width":9,"height":5}},{"id":"3bce3ad8-3742-4a4a-9a7f-03989d2771e7","block_type":"box","text":"For more information, please see our commentary “Our approach to engagement on human capital management,”","page_number":226,"box":{"x":84,"y":860,"width":814,"height":11}},{"id":"fa1652bc-a726-4341-9e0c-9dc154828fae","block_type":"box","text":"December 2025.","page_number":226,"box":{"x":70,"y":875,"width":118,"height":9}},{"id":"4a03af8f-f9d6-48ba-833f-33f1d05e01d4","block_type":"box","text":"BlackRock Investment Stewardship","page_number":226,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"b153d7b2-cdf1-45ed-b81b-f39eafa8135b","block_type":"box","text":"Global Principles | 12","page_number":226,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"d716cd97-2acf-4843-9dec-b9a37479b2c8","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":226,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"3bbceb60-c80d-4e88-a07d-0f11ca7a52f6","block_type":"box","text":"BIS votes proxies in these situations on a “best-effor ts” basis. In addition, BIS may determine that it is generally","page_number":227,"box":{"x":102,"y":45,"width":807,"height":11}},{"id":"80380175-c78d-41b9-8327-b25efa8d812d","block_type":"box","text":"in the interests of BlackRock’s clients not to vote proxies (or not to vote our full allocation) if the costs (including but","page_number":227,"box":{"x":70,"y":60,"width":830,"height":11}},{"id":"0102c67d-703f-4e0f-80ed-1f9c8c513f5c","block_type":"box","text":"not limited to oppor tunity costs associated with share-blocking constraints) associated with exercising a vote are","page_number":227,"box":{"x":69,"y":75,"width":805,"height":11}},{"id":"c2c27952-f64e-4008-a2c3-a9e85e5b9bf5","block_type":"box","text":"expected to outweigh the benefit the client would derive by voting on the proposal.","page_number":227,"box":{"x":69,"y":90,"width":585,"height":11}},{"id":"377cf68d-7010-4a69-bf22-3a51c76c9a60","block_type":"box","text":"CONFLICTS MANAGEMENT POLICIES AND PROCEDURES","page_number":227,"box":{"x":281,"y":120,"width":416,"height":9}},{"id":"709f1ddf-ec7d-4432-a514-53b097770794","block_type":"box","text":"BIS is a dedicated function whose responsibilities are separate from BlackRock’s sales, business par tnership or","page_number":227,"box":{"x":102,"y":143,"width":804,"height":11}},{"id":"e91a5f73-dae7-49d2-aae5-a983ec2e1849","block_type":"box","text":"enterprise-level vendor management activities.","page_number":227,"box":{"x":69,"y":158,"width":329,"height":11}},{"id":"9916a13e-c21b-4f60-b1bb-6b5f50c75aa2","block_type":"box","text":"BlackRock maintains policies and procedures that are designed to prevent undue influence on BIS’ proxy voting","page_number":227,"box":{"x":102,"y":181,"width":794,"height":11}},{"id":"e2f5f873-3d88-416c-9144-f3803a35682e","block_type":"box","text":"activity. Such influence might stem from any relationship between the investee company (or any shareholder","page_number":227,"box":{"x":69,"y":196,"width":771,"height":11}},{"id":"2dce3ffe-719d-4990-b09b-14139b5a0f6c","block_type":"box","text":"proponent or dissident shareholder) and BlackRock, BlackRock’s affiliates, a Fund or a Fund’s affiliates, or","page_number":227,"box":{"x":70,"y":211,"width":763,"height":11}},{"id":"01a0bf44-158f-4120-86a5-3f8f2f8573a5","block_type":"box","text":"BlackRock employees.","page_number":227,"box":{"x":70,"y":226,"width":157,"height":11}},{"id":"a8b3a142-a49c-4428-8dd8-3d2cfb051ca0","block_type":"box","text":"For information on how BIS manages conflicts of interest, please see our disclosure.","page_number":227,"box":{"x":102,"y":249,"width":602,"height":11}},{"id":"b0480967-4140-4a90-ad51-353ca7e18bed","block_type":"box","text":"SECURITIES LENDING","page_number":227,"box":{"x":409,"y":279,"width":159,"height":9}},{"id":"96f8d696-cdfd-47f9-b6a9-e313a8ebf9d4","block_type":"box","text":"When authorized, BlackRock acts as a securities lending agent on behalf of its clients. Lending securities","page_number":227,"box":{"x":101,"y":302,"width":751,"height":11}},{"id":"b9e012cd-ae0d-4e50-ad92-b10450948176","block_type":"box","text":"enables BlackRock to increase the returns in clients’ por tfolios, and BlackRock’s lending agreements allow it to","page_number":227,"box":{"x":69,"y":317,"width":797,"height":11}},{"id":"47eb280c-3cfc-43ce-bcc3-efe3a2b33e72","block_type":"box","text":"recall securities out on loan at any time. BlackRock (or any other lender) does not retain voting rights for securities","page_number":227,"box":{"x":69,"y":332,"width":817,"height":11}},{"id":"1c417fdf-cdcf-4121-9503-9fca98029c34","block_type":"box","text":"out on loan. Entitlements associated with the lent securities (dividends, coupons, etc.), while on loan are paid back","page_number":227,"box":{"x":69,"y":347,"width":823,"height":11}},{"id":"3ed8c802-5ce4-4a0c-b350-dddf6e334281","block_type":"box","text":"to the lender of the security as stipulated in industry standard legal agreements.","page_number":227,"box":{"x":68,"y":362,"width":575,"height":11}},{"id":"29008d44-8867-48f8-b2cc-70c7290f438a","block_type":"box","text":"With regard to the relationship between securities lending and proxy voting, BlackRock cannot vote shares on","page_number":227,"box":{"x":101,"y":385,"width":779,"height":11}},{"id":"6682deb6-24f6-4e6c-880d-f1693a526766","block_type":"box","text":"loan and may determine to recall them for voting, as guided by our fiduciary duty as an asset manager to our clients","page_number":227,"box":{"x":70,"y":400,"width":827,"height":11}},{"id":"74d19d0f-e46f-46da-95d3-10956405b3df","block_type":"box","text":"in helping them achieve their investment goals. While this has occurred in a limited number of cases, the decision to","page_number":227,"box":{"x":70,"y":415,"width":832,"height":11}},{"id":"943bb6a7-3e2d-4cb8-bf4b-b4f2df6684c9","block_type":"box","text":"recall securities on loan as par t of BlackRock’s securities lending program in order to vote is based on an evaluation","page_number":227,"box":{"x":69,"y":430,"width":832,"height":11}},{"id":"ed3ee524-1164-4bdf-8ca7-f77def10a08d","block_type":"box","text":"of various factors that include, but are not limited to, assessing potential securities lending revenue alongside the","page_number":227,"box":{"x":69,"y":445,"width":814,"height":12}},{"id":"9767bdee-d748-45ce-a005-69cb1023c573","block_type":"box","text":"potential long-term financial value to clients of voting those securities (based on the information available at the time","page_number":227,"box":{"x":70,"y":460,"width":834,"height":12}},{"id":"5387b2f8-5bc5-47f5-8716-c7c55e945fc8","block_type":"box","text":"of recall consideration).","page_number":227,"box":{"x":69,"y":475,"width":166,"height":12}},{"id":"bc4c9b96-e655-433f-9142-84530c76115b","block_type":"box","text":"17","page_number":227,"box":{"x":237,"y":476,"width":9,"height":4}},{"id":"bcd5fb3b-bee3-473e-8f8c-e8f693781f1e","block_type":"box","text":"BIS works with colleagues in the Securities Lending and Risk and Quantitative Analysis","page_number":227,"box":{"x":252,"y":476,"width":617,"height":11}},{"id":"d9888f8e-0367-4ab2-8b61-f4d74d6ac7c0","block_type":"box","text":"teams to evaluate the costs and benefits to clients of recalling shares on loan.","page_number":227,"box":{"x":68,"y":491,"width":563,"height":11}},{"id":"2c6c0481-e477-4eb7-8904-75b8b153dccf","block_type":"box","text":"In almost all instances, BlackRock anticipates that the potential long-term financial value to clients of voting","page_number":227,"box":{"x":102,"y":513,"width":770,"height":12}},{"id":"81c36952-2c78-4b9f-8a2a-14f3067583a6","block_type":"box","text":"shares would be less than the potential revenue the loan may provide clients. However, in cer tain instances,","page_number":227,"box":{"x":69,"y":529,"width":774,"height":11}},{"id":"8928956b-06a3-42b0-8a0c-48c8fff44e69","block_type":"box","text":"BlackRock may determine, in our independent business judgment as a fiduciary, that the value of voting outweighs","page_number":227,"box":{"x":70,"y":543,"width":816,"height":12}},{"id":"55ba7ca8-8bff-4a37-9270-6aaf9c0d2c6d","block_type":"box","text":"the securities lending revenue loss to clients and would therefore recall shares to be voted in those instances. It is","page_number":227,"box":{"x":68,"y":559,"width":822,"height":11}},{"id":"24c3ef33-b2ef-4000-9923-54522d2ea8ca","block_type":"box","text":"impor tant to note that the majority of lendable assets in the market at any given time are not out on loan.","page_number":227,"box":{"x":70,"y":574,"width":752,"height":11}},{"id":"8a0e0976-27c1-4b04-8347-fc57221a708e","block_type":"box","text":"Periodically, BlackRock reviews our process for determining whether to recall securities on loan in order to vote","page_number":227,"box":{"x":102,"y":596,"width":790,"height":12}},{"id":"8bbf3351-1b1d-4a1c-bab7-a4437429c95e","block_type":"box","text":"and may modify it as necessary.","page_number":227,"box":{"x":69,"y":612,"width":228,"height":11}},{"id":"fb3a88a4-7900-48a0-af96-ec0448ca0fe1","block_type":"box","text":"VOTING CHOICE","page_number":227,"box":{"x":430,"y":642,"width":117,"height":9}},{"id":"a5c89b4a-797e-486e-9f53-b4b44b6d532c","block_type":"box","text":"BlackRock offers Voting Choice, a program that provides eligible clients with more oppor tunities to par ticipate in","page_number":227,"box":{"x":102,"y":664,"width":800,"height":12}},{"id":"f3aa2acb-729d-4c28-a22b-c0c76df13d6a","block_type":"box","text":"the proxy voting process, where legally and operationally viable.","page_number":227,"box":{"x":68,"y":680,"width":452,"height":11}},{"id":"57c05a6f-0ed4-4aae-9f87-edcba7da3da7","block_type":"box","text":"18","page_number":227,"box":{"x":522,"y":680,"width":9,"height":4}},{"id":"009bbf83-a84a-40ed-ba28-da7b0d563873","block_type":"box","text":"Voting Choice is currently available for eligible clients invested in cer tain institutional pooled funds in the U.S.,","page_number":227,"box":{"x":101,"y":702,"width":786,"height":12}},{"id":"f709c153-0e8e-476e-9e53-eda4118159d3","block_type":"box","text":"UK, Ireland, Canada, and Switzerland that utilize index equity investment strategies, as well as eligible clients in","page_number":227,"box":{"x":70,"y":718,"width":797,"height":11}},{"id":"88aef917-6396-4443-8af6-98a406a49c6f","block_type":"box","text":"17","page_number":227,"box":{"x":69,"y":747,"width":8,"height":4}},{"id":"96033f76-384a-4180-bab8-c1a4402e7a21","block_type":"box","text":"Recalling securities on loan can be impacted by the timing of record dates. In the U.S., for example, the record","page_number":227,"box":{"x":84,"y":747,"width":789,"height":11}},{"id":"5c41196b-60d3-4eff-b2c6-0389f3b13f8f","block_type":"box","text":"date of a shareholder meeting typically falls before the proxy statements are released. Accordingly, it is not","page_number":227,"box":{"x":69,"y":762,"width":763,"height":11}},{"id":"be13e39c-6b87-4403-9783-ace42f0782cd","block_type":"box","text":"practicable to evaluate a proxy statement, determine that a vote has a material impact on a fund and recall any","page_number":227,"box":{"x":70,"y":777,"width":794,"height":11}},{"id":"94fbcb2b-784a-49b6-98ec-28fca36df0bb","block_type":"box","text":"shares on loan in advance of the record date for the annual meeting. As a result, managers must weigh independent","page_number":227,"box":{"x":69,"y":792,"width":833,"height":11}},{"id":"6d3d2fc5-dd97-4bf8-9842-ee893616ba0f","block_type":"box","text":"business judgement as a fiduciary, the benefit to a fund’s shareholders of recalling loaned shares in advance of an","page_number":227,"box":{"x":69,"y":807,"width":821,"height":11}},{"id":"ea5e9796-fd68-44dd-a6d4-b183b43587d1","block_type":"box","text":"estimated record date without knowing whether there will be a vote on matters which have a material impact on the","page_number":227,"box":{"x":69,"y":822,"width":823,"height":12}},{"id":"b2a347a1-2a5d-4b4b-8935-f350f8a848ac","block_type":"box","text":"fund (thereby forgoing potential securities lending revenue for the fund’s shareholders) or leaving shares on loan to","page_number":227,"box":{"x":68,"y":837,"width":822,"height":12}},{"id":"7e4c863f-619e-4d52-b71a-c7db65f409a4","block_type":"box","text":"potentially earn revenue for the fund (thereby forgoing the oppor tunity to vote).","page_number":227,"box":{"x":70,"y":852,"width":558,"height":12}},{"id":"568753a4-7919-42a2-9bcd-41dca4869fb8","block_type":"box","text":"18","page_number":227,"box":{"x":69,"y":870,"width":9,"height":5}},{"id":"c4c26e61-bb42-4243-af9a-7f210b506069","block_type":"box","text":"BlackRock will determine eligibility criteria under this program based upon, among other things, local market","page_number":227,"box":{"x":84,"y":870,"width":771,"height":11}},{"id":"5ccdb1d8-0411-4d56-998d-d309e23bdaaf","block_type":"box","text":"regulation and practice, cost considerations, operational risk and/or complexity, and financial considerations,","page_number":227,"box":{"x":69,"y":885,"width":779,"height":11}},{"id":"92dea550-0807-4dd2-b266-cc56a878977d","block_type":"box","text":"including the decision to lend securities.","page_number":227,"box":{"x":70,"y":901,"width":285,"height":11}},{"id":"ba989c77-f0f2-4a49-82fa-f7086845b51c","block_type":"box","text":"BlackRock Investment Stewardship","page_number":227,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"c01a508b-fb7a-4cfd-a518-fdc340f89707","block_type":"box","text":"Global Principles | 13","page_number":227,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"7960a954-12ba-4fb6-a690-3ba023dae87f","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":227,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"8bb945bd-7adb-4bca-80de-c7069af6c457","block_type":"box","text":"cer tain institutional pooled funds in the U.S., UK, Canada, and Switzerland that use systematic active equity","page_number":228,"box":{"x":69,"y":45,"width":772,"height":11}},{"id":"cba1e728-af19-4f35-a85a-1b5c22ba8a50","block_type":"box","text":"(SAE) strategies. In addition, institutional clients in separately managed accounts (SMAs) continue to be eligible for","page_number":228,"box":{"x":69,"y":60,"width":822,"height":11}},{"id":"dd7d245a-0185-4d75-b167-bb91a6dff181","block_type":"box","text":"BlackRock Voting Choice regardless of their investment strategies.","page_number":228,"box":{"x":70,"y":75,"width":471,"height":11}},{"id":"f0d7bdb9-4228-488e-b965-f7c48fa24b7d","block_type":"box","text":"19","page_number":228,"box":{"x":543,"y":75,"width":9,"height":5}},{"id":"72ddf7e1-5447-4164-a52c-55dfab41752d","block_type":"box","text":"Voting Choice is also available for eligible U.S.","page_number":228,"box":{"x":558,"y":75,"width":328,"height":11}},{"id":"3e131dea-ff78-4c3a-95e2-ecf2d7e0180c","block_type":"box","text":"retail shareholder accounts invested in BlackRock’s largest U.S. exchange-traded fund.","page_number":228,"box":{"x":69,"y":90,"width":619,"height":11}},{"id":"ec7216ee-3b37-4183-bfc9-4debea73dc0e","block_type":"box","text":"20","page_number":228,"box":{"x":690,"y":90,"width":9,"height":5}},{"id":"eb78d28c-6b52-4b07-9b19-bc137632f3a4","block_type":"box","text":"As a result, the shares attributed to BlackRock por tfolios in company share registers may be voted differently","page_number":228,"box":{"x":101,"y":113,"width":782,"height":11}},{"id":"46211e2e-7175-4f4f-be89-57754d8f2000","block_type":"box","text":"depending on whether our clients have authorized BIS to vote on their behalf, have authorized BIS to vote in","page_number":228,"box":{"x":69,"y":128,"width":767,"height":11}},{"id":"272da1c1-fc8f-4eda-ac30-2e2074ec5b75","block_type":"box","text":"accordance with a third-par ty policy, or have elected to vote shares in accordance with their own policy. Our clients","page_number":228,"box":{"x":69,"y":143,"width":814,"height":11}},{"id":"5d10d277-bb31-4cc1-b49a-4113b4482ac3","block_type":"box","text":"have greater control over proxy voting because of Voting Choice.","page_number":228,"box":{"x":69,"y":158,"width":454,"height":11}},{"id":"f25bedb1-b14b-430f-9f9c-e71294af4ec4","block_type":"box","text":"21","page_number":228,"box":{"x":525,"y":158,"width":9,"height":5}},{"id":"b1449fe6-873a-458f-a4df-1d0da74c6cc1","block_type":"box","text":"REPORTING AND VOTE TRANSPARENCY","page_number":228,"box":{"x":343,"y":188,"width":293,"height":9}},{"id":"af0e8ce6-1d1d-408c-87b1-f884889a46ec","block_type":"box","text":"We are committed to transparency of the stewardship work we do on behalf of clients. We inform clients about","page_number":228,"box":{"x":101,"y":211,"width":789,"height":11}},{"id":"92e26a18-73f4-4bb3-8392-44eaa2cc539f","block_type":"box","text":"our engagement and voting policies and activities through direct communication and through disclosure on our","page_number":228,"box":{"x":69,"y":226,"width":787,"height":11}},{"id":"d5736438-067b-4008-acab-dd664ad44d1d","block_type":"box","text":"website. We make public our regional voting guidelines for the benefit of clients and the companies in which we","page_number":228,"box":{"x":68,"y":241,"width":795,"height":11}},{"id":"fefac365-776b-4679-81fc-7acb6e1e8bd8","block_type":"box","text":"invest on their behalf. We also publish commentaries to share our approach to engagement on our five engagement","page_number":228,"box":{"x":70,"y":256,"width":825,"height":12}},{"id":"020b4586-ff17-461c-9d3b-7b602b458b2a","block_type":"box","text":"priorities, as well as quar terly repor ts detailing our proxy voting and engagement activities.","page_number":228,"box":{"x":70,"y":272,"width":644,"height":11}},{"id":"f2a35d30-f00c-496c-ba51-bef2efab6f57","block_type":"box","text":"19","page_number":228,"box":{"x":69,"y":324,"width":9,"height":4}},{"id":"b10d7000-173d-4dee-bf5d-f6892049f24f","block_type":"box","text":"With Voting Choice, SMA clients have the ability to select the policy that best aligns with their views and","page_number":228,"box":{"x":83,"y":323,"width":739,"height":12}},{"id":"10b33702-75ab-465a-8eed-a0c277e2099d","block_type":"box","text":"preferences from a set of voting policies from third-par ty proxy advisers. 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Fur ther, the Guidelines consider the","page_number":234,"box":{"x":102,"y":45,"width":751,"height":11}},{"id":"9b17200f-1397-4c74-b96c-0b95d0106012","block_type":"box","text":"differences between the actions and outcomes over which company management has influence, and those it","page_number":234,"box":{"x":101,"y":60,"width":778,"height":11}},{"id":"ef4b7f02-3312-493a-a2cd-9bc32dd09b5e","block_type":"box","text":"does not.","page_number":234,"box":{"x":101,"y":75,"width":66,"height":9}},{"id":"4033d500-1838-4808-b38e-4df8ce998f95","block_type":"box","text":"•","page_number":234,"box":{"x":69,"y":98,"width":6,"height":4}},{"id":"c0116975-d2b7-4bae-92c6-19253424900b","block_type":"box","text":"Focus on useful, contextualized disclosures that help inform investors views, while recognizing data","page_number":234,"box":{"x":102,"y":95,"width":729,"height":11}},{"id":"0a353739-aa61-4835-b09e-20b6dc9e53f3","block_type":"box","text":"limitations:","page_number":234,"box":{"x":102,"y":110,"width":80,"height":9}},{"id":"91340600-8e21-426d-85b2-b739d1bdd9a1","block_type":"box","text":"Under the Guidelines, the dedicated team looks for disclosures that outline key milestones and","page_number":234,"box":{"x":189,"y":110,"width":679,"height":11}},{"id":"19bdeb2f-4a5b-4e68-a63d-8296555b1de9","block_type":"box","text":"dependencies underpinning the company’s low-carbon transition strategy, explain the trade-offs required to adapt","page_number":234,"box":{"x":101,"y":125,"width":807,"height":12}},{"id":"a041987a-2b62-41cb-91d1-6495749f7e79","block_type":"box","text":"the business model, and include relevant data and narrative.","page_number":234,"box":{"x":101,"y":141,"width":433,"height":10}},{"id":"88dfea24-8e60-4d57-929d-f360a846a034","block_type":"box","text":"•","page_number":234,"box":{"x":69,"y":163,"width":6,"height":5}},{"id":"3ae09ff6-b223-4ade-8fad-650152228224","block_type":"box","text":"Consistency with the participating clients’ position as a minority investor:","page_number":234,"box":{"x":101,"y":161,"width":541,"height":11}},{"id":"b9a21b99-8685-4fb4-b791-79d470b2a817","block_type":"box","text":"The boards and executive leadership","page_number":234,"box":{"x":648,"y":161,"width":261,"height":11}},{"id":"a92dd938-5325-487e-ac66-80ca2c58b238","block_type":"box","text":"of companies determine a company’s strategy and its implementation. Under the Guidelines, the dedicated team","page_number":234,"box":{"x":102,"y":176,"width":805,"height":11}},{"id":"b9c9e55b-fc05-4a3f-b7f2-3f17fc701d7d","block_type":"box","text":"makes decisions on how to engage companies and vote proxies independently, based on its professional","page_number":234,"box":{"x":102,"y":191,"width":748,"height":11}},{"id":"76c2684b-c21f-4d9e-8c9f-585dd750dc71","block_type":"box","text":"judgment of the priorities and outcomes most aligned with par ticipating clients’ investment objectives.","page_number":234,"box":{"x":100,"y":206,"width":730,"height":11}},{"id":"44d69827-b91a-4396-8932-a1b52fbc8a35","block_type":"box","text":"Voting approach under the Guidelines","page_number":234,"box":{"x":68,"y":236,"width":273,"height":11}},{"id":"aa5d2177-3ed9-4614-89a2-0d2f89fe2a98","block_type":"box","text":"12","page_number":234,"box":{"x":342,"y":237,"width":9,"height":4}},{"id":"f5b3b6f4-06ac-4567-bd93-052cd77a0399","block_type":"box","text":"When evaluating each voting item across management or shareholder proposals, the dedicated team applies a","page_number":234,"box":{"x":101,"y":259,"width":791,"height":11}},{"id":"e72ca7c7-9833-4965-89f0-466555755685","block_type":"box","text":"case-by-case approach that reflects the uneven pace of the low-carbon transition across sectors and markets, and","page_number":234,"box":{"x":69,"y":274,"width":813,"height":11}},{"id":"611a4236-0433-429a-8b71-41a16e246855","block_type":"box","text":"acknowledges the distinction between what company management can influence and what lies beyond its control. As","page_number":234,"box":{"x":69,"y":289,"width":833,"height":11}},{"id":"91098520-494e-4f24-b04b-d73c60e7fb15","block_type":"box","text":"a result, voting decisions — on behalf of in-scope funds and SMAs — on similar proposals included on different","page_number":234,"box":{"x":69,"y":304,"width":799,"height":11}},{"id":"4bf6546f-86e4-416e-b7ee-548da23041c7","block_type":"box","text":"companies’ shareholder meeting agendas may vary depending on company, sector, or market-specific circumstances.","page_number":234,"box":{"x":69,"y":319,"width":837,"height":12}},{"id":"72fd9fb1-527f-442e-baef-2002af98e081","block_type":"box","text":"Consistent with the investment objective of each fund or account that has selected these Guidelines, the","page_number":234,"box":{"x":102,"y":342,"width":748,"height":11}},{"id":"232e52db-64ae-4bec-86c2-0030e7eb0a89","block_type":"box","text":"dedicated team will look to the companies to demonstrate the following:","page_number":234,"box":{"x":69,"y":357,"width":513,"height":11}},{"id":"1bc5d2df-6985-46f6-aa77-80ebe0ea0496","block_type":"box","text":"Corporate Disclosures","page_number":234,"box":{"x":69,"y":387,"width":160,"height":11}},{"id":"a9efa9a6-cc01-4fcc-9001-a4d9cb6ebe3d","block_type":"box","text":"13","page_number":234,"box":{"x":230,"y":388,"width":9,"height":4}},{"id":"f03cb2ab-115c-4ba5-9eca-a09cbc5e03e6","block_type":"box","text":"In the context of these Guidelines, the dedicated team looks for companies to provide sufficient disclosure to","page_number":234,"box":{"x":102,"y":410,"width":781,"height":11}},{"id":"66297d84-caf4-419d-9eea-b184842873a1","block_type":"box","text":"assess whether the company’s strategy is aligned with the low-carbon transition. As a general point, the team looks","page_number":234,"box":{"x":69,"y":425,"width":825,"height":11}},{"id":"bb77b336-9356-4b2a-9d21-b1d021561c7e","block_type":"box","text":"to companies that are impor tant to the transition to a low-carbon economy to explain the strategy and governance","page_number":234,"box":{"x":68,"y":440,"width":812,"height":12}},{"id":"d108139f-76f1-4b65-97fe-2e5edf864851","block_type":"box","text":"frameworks that they have determined most appropriate, which may include:","page_number":234,"box":{"x":68,"y":455,"width":545,"height":11}},{"id":"81ec23c6-1688-4474-b2cf-9ffcb418206a","block_type":"box","text":"(1) a low-carbon transition strategy to demonstrate their alignment with the ambition to limit average global","page_number":234,"box":{"x":69,"y":476,"width":769,"height":11}},{"id":"25582798-0da8-4ef8-a117-4ea2fae40a75","block_type":"box","text":"temperature rise to 1.5°C above pre-industrial levels. This would typically include a long-term strategy to achieve","page_number":234,"box":{"x":101,"y":491,"width":800,"height":11}},{"id":"b46e8e23-e1a3-48e1-b815-e22a241947e4","block_type":"box","text":"net-zero GHG emissions by 2050, with appropriate near- and medium-term milestones to assess their progress.","page_number":234,"box":{"x":102,"y":506,"width":796,"height":11}},{"id":"d0af0ab8-50d8-4d15-9c9f-1846b90c0a05","block_type":"box","text":"(2) low-carbon transition-related repor ting. Standardized disclosure of sustainability-related data suppor ts investors","page_number":234,"box":{"x":69,"y":526,"width":828,"height":11}},{"id":"2e3ada15-6eaf-4d54-8b26-384a840bc3af","block_type":"box","text":"in making informed decisions. The International Sustainability Standards Board (ISSB) standards, IFRS S1 and","page_number":234,"box":{"x":102,"y":541,"width":787,"height":11}},{"id":"26f29cf2-2f21-4efd-8f24-91dac766c368","block_type":"box","text":"S2, represent one such approach to standardization that the dedicated team finds useful in its analysis.","page_number":234,"box":{"x":102,"y":556,"width":741,"height":11}},{"id":"0bdfe558-137c-41cd-a637-48c319297d8c","block_type":"box","text":"14, 15","page_number":234,"box":{"x":845,"y":557,"width":25,"height":5}},{"id":"238dafbc-27da-45c1-8054-50d12c9c92d1","block_type":"box","text":"IFRS","page_number":234,"box":{"x":877,"y":556,"width":30,"height":9}},{"id":"8f47590e-9b8b-4f2b-a373-8a3cad49d2e5","block_type":"box","text":"S1 addresses the general requirements of sustainability repor ting and IFRS S2 sets out the disclosures that","page_number":234,"box":{"x":102,"y":571,"width":774,"height":12}},{"id":"33d03720-d567-4869-bd5d-30628f35c18e","block_type":"box","text":"provide investors with decision-useful information about a company’s most significant climate- and low-carbon","page_number":234,"box":{"x":102,"y":586,"width":781,"height":12}},{"id":"d3589668-6cf5-41ee-9066-dadef89639e4","block_type":"box","text":"transition-related risks and oppor tunities. This includes receiving independent, third-par ty assurances, as audit","page_number":234,"box":{"x":101,"y":602,"width":792,"height":11}},{"id":"24b37f9b-93b7-4f07-ad7b-098cc95113b6","block_type":"box","text":"and assurance standards are developed.","page_number":234,"box":{"x":102,"y":617,"width":290,"height":11}},{"id":"d5969958-551f-4b04-8c27-00e6b2990150","block_type":"box","text":"12","page_number":234,"box":{"x":69,"y":646,"width":9,"height":5}},{"id":"42901975-fca3-47ce-824e-ac09b6f5ccd4","block_type":"box","text":"These Guidelines are not intended to limit the analysis of individual issues at specific companies or provide a guide","page_number":234,"box":{"x":83,"y":646,"width":825,"height":11}},{"id":"fde80a6a-ea6d-49cd-af93-b6b419d8ba7c","block_type":"box","text":"as to how the dedicated team will engage and/or vote in every instance. The Guidelines are applied by the dedicated","page_number":234,"box":{"x":69,"y":661,"width":833,"height":11}},{"id":"68b4c623-ee58-49e9-a982-f0fda6c3f80a","block_type":"box","text":"team with discretion, on a case-by-case basis, taking into consideration the range of issues and facts specific to the","page_number":234,"box":{"x":68,"y":676,"width":830,"height":11}},{"id":"2c8ff92d-cf27-437d-a149-cf81c3cd4f07","block_type":"box","text":"company, as well as individual ballot items at shareholder meetings.","page_number":234,"box":{"x":69,"y":691,"width":486,"height":11}},{"id":"6adc3364-e36e-472f-8413-c545d05cdabb","block_type":"box","text":"13","page_number":234,"box":{"x":69,"y":709,"width":9,"height":5}},{"id":"569057e5-dedb-4a09-a68f-6252dc775784","block_type":"box","text":"Given data and measurement limitations, companies may need to provide estimated GHG emissions where","page_number":234,"box":{"x":84,"y":709,"width":764,"height":11}},{"id":"6cd61667-97d9-40db-8d41-378e9b1843bd","block_type":"box","text":"repor ting methodologies are nascent. In addition, cer tain disclosures related to a company’s plans for adapting their","page_number":234,"box":{"x":69,"y":724,"width":834,"height":11}},{"id":"43cf0c5f-4445-4b5d-b639-08034a0c9c31","block_type":"box","text":"business models through the low-carbon transition may require forward-looking statements.","page_number":234,"box":{"x":69,"y":739,"width":651,"height":11}},{"id":"dbae1b55-6652-4a09-b9d7-51cebd715b00","block_type":"box","text":"14","page_number":234,"box":{"x":69,"y":757,"width":9,"height":4}},{"id":"ce47b02b-e74b-4919-99e2-103ffab9e7b3","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Repor ting Standards","page_number":234,"box":{"x":83,"y":757,"width":744,"height":11}},{"id":"5b44d68e-0135-43e3-a86f-e1f90c7c4b18","block_type":"box","text":"(IFRS) Foundation. The standards build on the Task Force on Climate-related Financial Disclosures (TCFD) framework","page_number":234,"box":{"x":69,"y":772,"width":828,"height":11}},{"id":"692ddd5f-3159-429d-a5bf-8393b6046331","block_type":"box","text":"and the standards and metrics developed by the Sustainability Accounting Standards Board (SASB), which have both","page_number":234,"box":{"x":69,"y":787,"width":830,"height":11}},{"id":"5cf26bc2-107b-41b7-8548-2de14da477fa","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":234,"box":{"x":69,"y":802,"width":809,"height":11}},{"id":"a9173180-a28d-4b1e-8718-781adda85286","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":234,"box":{"x":70,"y":817,"width":778,"height":11}},{"id":"068ae54d-fd90-4cba-9e10-e3e729b0b791","block_type":"box","text":"Disclosures.” Websites accessed in December 2025.","page_number":234,"box":{"x":70,"y":832,"width":380,"height":9}},{"id":"75f7c434-40e0-4fb7-b297-686a6fe75672","block_type":"box","text":"15","page_number":234,"box":{"x":69,"y":850,"width":9,"height":5}},{"id":"8cc7b380-f35d-4c8c-905b-5aa66a80adf1","block_type":"box","text":"A number of jurisdictions are consulting on adopting the standards issued to date or have already committed to","page_number":234,"box":{"x":83,"y":850,"width":795,"height":11}},{"id":"65b2c0ee-c5f7-41ff-82fc-557a8d94ad0f","block_type":"box","text":"doing so. BIS does not mandate any specific disclosure framework companies should use, and recognize that some","page_number":234,"box":{"x":69,"y":865,"width":826,"height":11}},{"id":"607b7018-87e6-4a3f-8c27-3fd2284d8892","block_type":"box","text":"companies may repor t using different standards, some of which may be required by regulation. In such cases, we","page_number":234,"box":{"x":69,"y":880,"width":811,"height":11}},{"id":"c321a37e-ab79-49cc-a7f3-5997eabacd0e","block_type":"box","text":"ask that companies highlight the metrics that are industry- or company-specific. We also recognize that companies","page_number":234,"box":{"x":69,"y":895,"width":816,"height":12}},{"id":"3c333ba2-f73b-4868-a4ee-5b42c753f780","block_type":"box","text":"may be phasing in repor ting over several years. We do not prescribe timelines regarding when companies should","page_number":234,"box":{"x":69,"y":911,"width":803,"height":11}},{"id":"141188f9-1e87-4b27-b15f-8a06f2677416","block_type":"box","text":"BlackRock Investment Stewardship","page_number":234,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"7a387139-15e7-4a34-b2ea-08d774142f93","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines | 5","page_number":234,"box":{"x":509,"y":942,"width":400,"height":13}},{"id":"dca9eb40-c0d8-46dc-a361-406ad10db670","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":234,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"cbbfc961-2e71-4d57-8811-bf84d20fd298","block_type":"box","text":"(3) scope 1 and scope 2, and most significant scope 3 GHG emissions","page_number":235,"box":{"x":69,"y":45,"width":513,"height":11}},{"id":"f6a17654-efec-4532-9771-f0393c360e60","block_type":"box","text":"16, 17","page_number":235,"box":{"x":583,"y":45,"width":26,"height":5}},{"id":"7d479ecb-ad34-4795-99d0-0344132fd21f","block_type":"box","text":"In addition, the dedicated team looks to","page_number":235,"box":{"x":615,"y":45,"width":283,"height":10}},{"id":"5d714836-6034-4636-8198-dbbf0677cb11","block_type":"box","text":"companies to disclose their emissions reduction targets for scope 1 and 2 emissions, science-based where","page_number":235,"box":{"x":101,"y":60,"width":770,"height":11}},{"id":"92ab6a4e-0eb1-455b-abf9-c7ace6f81ec7","block_type":"box","text":"possible. The team welcomes disclosure of targets or indicative goals, where companies have set them, for","page_number":235,"box":{"x":102,"y":75,"width":768,"height":11}},{"id":"15bca400-33b3-4426-999f-eb2a9fc06559","block_type":"box","text":"scope 3 emissions reductions. 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The Protocol Standards and Guidance are currently being updated to ensure they continue to","page_number":235,"box":{"x":69,"y":648,"width":838,"height":12}},{"id":"7acf153f-4236-4284-91cc-382cc6347d70","block_type":"box","text":"provide “a rigorous and credible accounting foundation for businesses to measure, plan and track progress toward","page_number":235,"box":{"x":70,"y":663,"width":816,"height":12}},{"id":"80dbc2f5-2676-42bf-88ad-2b5adae9650e","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":235,"box":{"x":69,"y":679,"width":784,"height":11}},{"id":"42a13a18-75af-4f9c-9a45-47faeff0125e","block_type":"box","text":"18","page_number":235,"box":{"x":69,"y":697,"width":9,"height":4}},{"id":"d9385cf8-603f-42f3-8494-73476931b73c","block_type":"box","text":"The dedicated team does not believe the purpose of scope 3 disclosure requirements should be to push publicly","page_number":235,"box":{"x":83,"y":696,"width":804,"height":11}},{"id":"8c6ae04d-dd99-4a89-9d6e-bf054b974b81","block_type":"box","text":"traded companies into the role of enforcing emission reduction targets outside of their control. Given methodological","page_number":235,"box":{"x":68,"y":711,"width":832,"height":12}},{"id":"4f1ddc58-1af6-484d-a467-2a5d54bdb600","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":235,"box":{"x":69,"y":726,"width":832,"height":12}},{"id":"a1914a87-01fb-4475-aebb-259d6e0f344e","block_type":"box","text":"useful when companies focus their disclosures on those of the fifteen scope 3 GHG Protocol categories that are","page_number":235,"box":{"x":69,"y":742,"width":800,"height":11}},{"id":"d425f1b2-3f2c-45f2-8ae0-51cb0327a281","block_type":"box","text":"material to their business models.","page_number":235,"box":{"x":69,"y":757,"width":243,"height":9}},{"id":"0834dff3-48dc-43dc-be58-37e6b86a76de","block_type":"box","text":"19","page_number":235,"box":{"x":69,"y":775,"width":9,"height":4}},{"id":"a9b20a32-5989-4182-8024-855b5f03f5c3","block_type":"box","text":"International Financial Repor ting Standards, “IFRS S2: Climate-related Disclosures,” June 2023, accessed in","page_number":235,"box":{"x":84,"y":774,"width":777,"height":12}},{"id":"b2551958-6559-4369-a9c7-d0c98d0aa819","block_type":"box","text":"December 2025.","page_number":235,"box":{"x":70,"y":790,"width":118,"height":8}},{"id":"69918ce1-685f-4b72-8ac4-2eba8e4433e4","block_type":"box","text":"20","page_number":235,"box":{"x":69,"y":807,"width":9,"height":5}},{"id":"fa4a08ce-5ad9-4b6b-ad0a-0b5ffac5ef17","block_type":"box","text":"More companies are developing such plans, and public policymakers in cer tain markets are signaling their","page_number":235,"box":{"x":84,"y":807,"width":758,"height":11}},{"id":"cc00ff36-c3f9-49dc-a3e5-1ff7bd644ee9","block_type":"box","text":"intentions to require them or already have requirements in place, such as Australia, Brazil, and the European Union","page_number":235,"box":{"x":70,"y":822,"width":820,"height":11}},{"id":"ab7b7699-9994-4157-ab93-e96e390c437c","block_type":"box","text":"(please see the International Transition Plan Network for information). BlackRock views transition plans as a method","page_number":235,"box":{"x":69,"y":837,"width":829,"height":11}},{"id":"829d38d2-3c8b-43fa-9dcf-0be8bca3faec","block_type":"box","text":"for a company to both internally assess and externally communicate its long-term strategy, ambition, objectives, and","page_number":235,"box":{"x":68,"y":852,"width":829,"height":12}},{"id":"1756e44d-42c6-438f-bdb2-3fb4dc700c3b","block_type":"box","text":"actions to create financial value through the global transition towards a low-carbon economy. Across the landscape","page_number":235,"box":{"x":69,"y":868,"width":818,"height":11}},{"id":"2236aaa1-daee-458a-ba2d-6bb44e1e69f0","block_type":"box","text":"there remains divergence on the objectives of such plans and the details they should contain. 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The research uses a definition of materiality from the GHG Protocol,","page_number":236,"box":{"x":69,"y":734,"width":813,"height":11}},{"id":"205e0ee7-de07-4a39-ab8e-a22e71c7a9af","block_type":"box","text":"which “encourages companies to maintain a representative inventory of the “most significant GHG emissions, [that]","page_number":236,"box":{"x":68,"y":749,"width":828,"height":11}},{"id":"04748235-9249-4299-860d-2fbd0d7920ab","block_type":"box","text":"offer the most significant GHG reduction oppor tunities and are most relevant to the company’s business goals.”","page_number":236,"box":{"x":69,"y":764,"width":801,"height":12}},{"id":"5e8347be-9cfb-4891-b0c3-4dfea2a501fa","block_type":"box","text":"Website accessed in December 2025.","page_number":236,"box":{"x":68,"y":779,"width":272,"height":9}},{"id":"24787fed-e8b4-4eaa-acb6-97aac67a87d5","block_type":"box","text":"22","page_number":236,"box":{"x":69,"y":797,"width":9,"height":5}},{"id":"871a36f6-b502-491b-b69d-14117aed9a5d","block_type":"box","text":"Corporate political activities may include lobbying as defined by local regulations, policy engagement (including","page_number":236,"box":{"x":84,"y":797,"width":787,"height":11}},{"id":"d0bd5c33-768f-4a5f-91a1-1bd4520e8afa","block_type":"box","text":"trade association memberships), and corporate political contributions.","page_number":236,"box":{"x":68,"y":812,"width":500,"height":11}},{"id":"e0faed43-4185-405d-9a81-6820749c4756","block_type":"box","text":"23","page_number":236,"box":{"x":69,"y":830,"width":9,"height":5}},{"id":"b28e14c0-3e81-4cd6-aa23-e9493af04fcb","block_type":"box","text":"Board repor t votes are generally advisory and relate to repor ts issued by the board of directors that may contain","page_number":236,"box":{"x":84,"y":830,"width":801,"height":11}},{"id":"3256b396-f8d7-43d1-bf39-9deecce39cda","block_type":"box","text":"information on a company’s sustainability effor ts, operational resilience, or financial condition, among others.","page_number":236,"box":{"x":70,"y":845,"width":782,"height":11}},{"id":"ffb3b0d1-e45a-453a-87d0-8aaa74e17f7c","block_type":"box","text":"BlackRock Investment Stewardship","page_number":236,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"b7073cb8-d05b-4d22-abf3-8ff121794edf","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines | 7","page_number":236,"box":{"x":509,"y":942,"width":400,"height":13}},{"id":"874e2dc8-516e-4e2d-9996-34f17cb8e7d5","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":236,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"7c0629e2-121b-48ed-9ea5-963dd8270cd2","block_type":"box","text":"Where the dedicated team has not suppor ted director elections over climate concerns in a prior year, and the","page_number":237,"box":{"x":101,"y":45,"width":780,"height":11}},{"id":"ba2e6c16-f301-4e53-aaca-34c60868bcc2","block_type":"box","text":"company has not subsequently made progress towards aligning with the transition to a low-carbon economy, the team","page_number":237,"box":{"x":69,"y":60,"width":839,"height":11}},{"id":"cd03c7c4-d5f4-418f-9aae-7ac0a5ed805b","block_type":"box","text":"may escalate by not suppor ting the re-election of additional responsible directors.","page_number":237,"box":{"x":69,"y":75,"width":582,"height":11}},{"id":"452b6fd4-2a0a-4eba-8e0d-9f443ade3740","block_type":"box","text":"24","page_number":237,"box":{"x":653,"y":75,"width":9,"height":5}},{"id":"a2b683f4-f397-4332-bce0-47b5e302ea1f","block_type":"box","text":"Management proposals to approve a climate strategy or progress report","page_number":237,"box":{"x":69,"y":105,"width":528,"height":11}},{"id":"547dd697-28e1-4bea-bf7d-7f79494e2ef3","block_type":"box","text":"In cer tain markets, company management may submit proposals— commonly referred to as “Say on Climate” —","page_number":237,"box":{"x":102,"y":128,"width":807,"height":11}},{"id":"84d0eb2c-4aff-48ca-a0d0-da7222f45cde","block_type":"box","text":"seeking shareholder approval of their climate action plans or progress repor ts. The Guidelines consider these","page_number":237,"box":{"x":69,"y":143,"width":782,"height":11}},{"id":"077074a3-3046-4f90-b1f2-696c06c7b32f","block_type":"box","text":"proposals as a valuable governance mechanism that can enhance transparency, accountability, and investors’","page_number":237,"box":{"x":70,"y":158,"width":782,"height":11}},{"id":"2550367c-ae6f-4301-81fe-55024aab76de","block_type":"box","text":"understanding of a company’s climate strategy. The dedicated team generally suppor ts management’s climate","page_number":237,"box":{"x":69,"y":173,"width":787,"height":11}},{"id":"91b63214-50ec-452b-9db8-4871d2ce12f3","block_type":"box","text":"strategy proposal if, in the team’s assessment based on these Guidelines, the strategy is aligned with the low-carbon","page_number":237,"box":{"x":69,"y":188,"width":838,"height":12}},{"id":"05839c16-a1e7-4909-943d-a82056b2523b","block_type":"box","text":"transition. Similarly, the dedicated team generally suppor ts management’s proposal on a progress repor t if the","page_number":237,"box":{"x":68,"y":203,"width":792,"height":12}},{"id":"1322eb06-a1f4-44b1-aed9-63d30b1b767a","block_type":"box","text":"company has clearly explained its progress against, and any deviations from or changes to, its stated low-carbon","page_number":237,"box":{"x":69,"y":218,"width":803,"height":12}},{"id":"bfbc5fe8-cad3-4391-9a37-ff31e7c4052b","block_type":"box","text":"transition plan and targets.","page_number":237,"box":{"x":68,"y":234,"width":193,"height":11}},{"id":"4502a486-0b54-4b55-bbb1-2629b87b78ed","block_type":"box","text":"Shareholder proposals on climate and low-carbon transition matters","page_number":237,"box":{"x":68,"y":264,"width":495,"height":11}},{"id":"191f96f6-a257-472c-8b21-4b0b120d8d3b","block_type":"box","text":"In most markets, shareholders can submit proposals to be voted on at a company’s shareholder meeting, as","page_number":237,"box":{"x":102,"y":287,"width":777,"height":11}},{"id":"3002ccdc-b555-4bc6-aec4-4313ec0fc3e8","block_type":"box","text":"long as cer tain requirements are met. 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The dedicated team assesses the implications for, and the relevance to, the","page_number":237,"box":{"x":68,"y":407,"width":770,"height":12}},{"id":"e3610a33-597a-4704-9ab9-18bb08856251","block_type":"box","text":"company’s stated low-carbon transition strategy and targets. Under the Guidelines, the team may suppor t","page_number":237,"box":{"x":69,"y":423,"width":754,"height":11}},{"id":"5d15b476-aa6b-4878-8b3b-18eb18489055","block_type":"box","text":"shareholder proposals that, for example, ask a company to:","page_number":237,"box":{"x":69,"y":438,"width":425,"height":11}},{"id":"dfc94a17-500c-4c53-b044-86591ca7ae22","block_type":"box","text":"•","page_number":237,"box":{"x":69,"y":461,"width":6,"height":4}},{"id":"b846398d-fec9-46f0-8d26-aa7bdc20647a","block_type":"box","text":"Publish a business plan, and related disclosures, consistent with the ambition to limit average global","page_number":237,"box":{"x":102,"y":458,"width":719,"height":11}},{"id":"4e3cc10d-6251-46fc-ad21-32163733ccb7","block_type":"box","text":"temperature rise to no more than 1.5°C above pre-industrial levels","page_number":237,"box":{"x":101,"y":473,"width":474,"height":11}},{"id":"6efc565a-041c-488b-872a-0c06333f3201","block_type":"box","text":"•","page_number":237,"box":{"x":69,"y":496,"width":6,"height":5}},{"id":"1204b38d-fac3-40cb-8b52-b883fb560e2d","block_type":"box","text":"Align scope 1 and 2 GHG emissions reduction targets to, and/or discuss how their targets align with, a long-term","page_number":237,"box":{"x":101,"y":493,"width":807,"height":11}},{"id":"0072c8f1-8523-4d79-b41b-4ad760aaefee","block_type":"box","text":"goal of the company achieving net zero GHG emissions by 2050","page_number":237,"box":{"x":101,"y":508,"width":457,"height":12}},{"id":"eeed4090-8b02-4380-b9ba-8017b8433d79","block_type":"box","text":"•","page_number":237,"box":{"x":69,"y":531,"width":6,"height":5}},{"id":"ffd1b3c4-dce2-4e7e-b972-2f4deeb268a0","block_type":"box","text":"Disclose the categories of scope 3 GHG emissions most significant to a company’s business model","page_number":237,"box":{"x":102,"y":528,"width":712,"height":12}},{"id":"8d6f308a-3f10-4436-b7cb-dbb54ba6a14e","block_type":"box","text":"•","page_number":237,"box":{"x":69,"y":551,"width":6,"height":5}},{"id":"c713d8b6-a8f6-42ed-9a36-de909827a556","block_type":"box","text":"Improve voluntary disclosures on the alignment of a company’s climate-related corporate political activities with","page_number":237,"box":{"x":102,"y":549,"width":794,"height":11}},{"id":"850b8669-0dca-4b0e-99a4-0a5894796ea0","block_type":"box","text":"its strategic policy positions, where existing disclosure is insufficient","page_number":237,"box":{"x":102,"y":564,"width":489,"height":11}},{"id":"67669c1b-deb0-45aa-9431-ca518d2ceed2","block_type":"box","text":"25","page_number":237,"box":{"x":592,"y":564,"width":9,"height":5}},{"id":"482236e5-d632-4402-a7dc-669d3815ace1","block_type":"box","text":"The dedicated team does not suppor t shareholder proposals that seek to constrain board or management","page_number":237,"box":{"x":101,"y":587,"width":758,"height":11}},{"id":"0e57a466-5a15-4334-925e-30b285e8d732","block_type":"box","text":"decision-making or direct specific business or strategic decisions.","page_number":237,"box":{"x":69,"y":601,"width":468,"height":12}},{"id":"9b12a445-af79-433f-b140-d4efd0c2b185","block_type":"box","text":"RELATED MATTERS","page_number":237,"box":{"x":419,"y":632,"width":140,"height":9}},{"id":"0a64a96f-6ebf-42fb-91d9-ea87e2467be6","block_type":"box","text":"There are other business items not covered above that may be put to a shareholder vote that could address","page_number":237,"box":{"x":101,"y":655,"width":771,"height":11}},{"id":"9b7f89c0-1ac7-4df9-b5e7-8460a711b8f8","block_type":"box","text":"matters relevant to the transition to a low-carbon economy. 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Generally, voting on these matters would","page_number":237,"box":{"x":68,"y":685,"width":831,"height":11}},{"id":"72d4a5d7-710a-442b-8fcb-a03f1ee5fc02","block_type":"box","text":"be covered by BIS’ Benchmark Policies.","page_number":237,"box":{"x":69,"y":700,"width":280,"height":11}},{"id":"22c3a222-308b-4350-a95e-dd9ead0330d4","block_type":"box","text":"Executive compensation","page_number":237,"box":{"x":69,"y":730,"width":177,"height":11}},{"id":"261789dc-53af-481e-ba1a-75a61149e7e4","block_type":"box","text":"The dedicated team looks to company boards to put in place a compensation structure that incentivizes and","page_number":237,"box":{"x":101,"y":753,"width":772,"height":11}},{"id":"856c45d6-54b7-4bfb-982b-a1a49fe4309e","block_type":"box","text":"rewards executives appropriately. Some companies, in light of their long-term strategy, may decide to include relevant","page_number":237,"box":{"x":69,"y":768,"width":837,"height":11}},{"id":"d4505b97-a316-41ba-bab0-b1234d427aa8","block_type":"box","text":"GHG emissions reduction targets or low-carbon transition-related metrics in their incentive plans. In such cases, the","page_number":237,"box":{"x":69,"y":783,"width":826,"height":11}},{"id":"4550b535-9f4e-42a8-9262-acddc8006f6c","block_type":"box","text":"dedicated team would engage to understand the alignment between those metrics and the company’s stated climate","page_number":237,"box":{"x":69,"y":798,"width":834,"height":11}},{"id":"6db9c0c4-8440-449d-a142-68351b33121f","block_type":"box","text":"24","page_number":237,"box":{"x":69,"y":828,"width":9,"height":4}},{"id":"b18df2eb-5394-44a7-915d-82f5b4e77344","block_type":"box","text":"While the dedicated team may escalate voting by not suppor ting additional management proposals, principally","page_number":237,"box":{"x":83,"y":827,"width":787,"height":12}},{"id":"a2728af7-e41b-4c7a-8891-26372b3773fa","block_type":"box","text":"director elections, the team does not consider filing shareholder proposals, preannouncing voting intentions or using","page_number":237,"box":{"x":69,"y":842,"width":832,"height":12}},{"id":"0f13eed8-c33d-40fe-8c12-89ab7696ce02","block_type":"box","text":"the media to amplify concerns as appropriate courses of action. 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Clear disclosure also helps investors assess whether pay structures are consistent with long-term climate","page_number":238,"box":{"x":69,"y":45,"width":821,"height":11}},{"id":"d9fc12a4-253f-48f8-87a7-4d9b38844ea6","block_type":"box","text":"strategy and risk management.","page_number":238,"box":{"x":69,"y":60,"width":219,"height":11}},{"id":"23bdc77a-aaee-44fc-8139-454458a4e072","block_type":"box","text":"Auditors and audit-related issues","page_number":238,"box":{"x":68,"y":90,"width":240,"height":9}},{"id":"3cb69d19-e40e-490a-9bc2-2010b69af56c","block_type":"box","text":"For companies with material climate or transition risks or oppor tunities in their business models, the dedicated","page_number":238,"box":{"x":102,"y":113,"width":793,"height":11}},{"id":"e016972e-1d17-45d7-a0ee-b1dd70e918f5","block_type":"box","text":"team is interested in understanding whether the company considers and, if relevant, quantifies, and accounts for","page_number":238,"box":{"x":68,"y":128,"width":807,"height":11}},{"id":"3914f50c-d25c-4a9e-b6a3-44dc8fe8cd79","block_type":"box","text":"material climate-related risks in its financial statements, including if the company explains such risks within the","page_number":238,"box":{"x":69,"y":143,"width":794,"height":11}},{"id":"932d84e5-0653-4a29-bf38-81af7ae1427c","block_type":"box","text":"context of its audit repor t. The team notes that assurance of corporate disclosures related to climate risk and the","page_number":238,"box":{"x":69,"y":158,"width":812,"height":11}},{"id":"160dd105-bda7-4a5c-b1f7-8b19ef7a170d","block_type":"box","text":"transition to a low-carbon economy is still nascent.","page_number":238,"box":{"x":68,"y":173,"width":361,"height":11}},{"id":"631f6787-fb7d-4354-bd26-9bc6b3a44264","block_type":"box","text":"Mergers, acquisitions, asset sales, and other special situations","page_number":238,"box":{"x":69,"y":203,"width":463,"height":11}},{"id":"4cbec183-b6d6-4626-91f8-9a602acf5eae","block_type":"box","text":"Special situations will be considered on their financial merits, but the dedicated team may engage on climate","page_number":238,"box":{"x":102,"y":226,"width":783,"height":11}},{"id":"246e789f-1830-4750-839d-a5a08fd4fea5","block_type":"box","text":"related factors under these Guidelines where a transaction may significantly alter a company’s climate strategy or a","page_number":238,"box":{"x":69,"y":241,"width":824,"height":11}},{"id":"cd884c8a-8f9d-453c-b7d2-e5cd0f5b7634","block_type":"box","text":"shareholder activist has proposed governance, strategic or operational changes that may impact its climate strategy.","page_number":238,"box":{"x":69,"y":257,"width":831,"height":11}},{"id":"e45d8cc8-6d0e-4499-89ce-190e33561f9c","block_type":"box","text":"The dedicated team does not promote changes in corporate control or engage in shareholder activism.","page_number":238,"box":{"x":68,"y":272,"width":731,"height":11}},{"id":"ad8b594b-eaf9-4709-9620-4bc4d1885ee8","block_type":"box","text":"Other business relevant sustainability-related risks and opportunities","page_number":238,"box":{"x":69,"y":302,"width":503,"height":11}},{"id":"5961b0ef-b3d7-494d-ae4f-ad9383716bf1","block_type":"box","text":"Climate risk and the transition to a low-carbon economy are interconnected with a number of other material","page_number":238,"box":{"x":102,"y":324,"width":762,"height":11}},{"id":"b422c9f9-289f-4869-8bde-0ae42a940949","block_type":"box","text":"sustainability-related risks and oppor tunities that may be relevant to a company’s business model and long-term","page_number":238,"box":{"x":69,"y":340,"width":802,"height":11}},{"id":"a656b5f2-0395-4745-a08c-894c042a8d14","block_type":"box","text":"financial per formance. These include a company’s impacts or dependencies on natural capital and key","page_number":238,"box":{"x":68,"y":355,"width":734,"height":11}},{"id":"e248b525-a91b-43aa-ba10-4fa768c226f0","block_type":"box","text":"stakeholders.","page_number":238,"box":{"x":69,"y":370,"width":95,"height":9}},{"id":"e9cde2ce-900d-4392-824f-2a373c767d1b","block_type":"box","text":"26","page_number":238,"box":{"x":166,"y":370,"width":9,"height":5}},{"id":"e2f9c4c7-30a9-4fb2-9a06-518dc96b45e3","block_type":"box","text":"In the context of these Guidelines, the dedicated team may engage companies to better understand","page_number":238,"box":{"x":182,"y":370,"width":710,"height":11}},{"id":"4ce2f376-f7b1-47fb-a78d-4df17db90812","block_type":"box","text":"how they are managing the impact on people (e.g., employees, suppliers, customers and communities) of any","page_number":238,"box":{"x":69,"y":385,"width":783,"height":11}},{"id":"7fd5fe01-84b0-4f3f-8081-170992912682","block_type":"box","text":"strategic or operational changes they are making in relation to their transition to a low-carbon economy. Similarly, the","page_number":238,"box":{"x":69,"y":400,"width":832,"height":11}},{"id":"29afe45f-5abc-4da4-be08-20329aa0246b","block_type":"box","text":"team may engage companies that face risks and oppor tunities related to land use and deforestation, access to fresh","page_number":238,"box":{"x":68,"y":415,"width":838,"height":11}},{"id":"15b0b364-7ac4-417a-b8d3-d2fc133fa38e","block_type":"box","text":"water, or the ability to secure scarce resources critical to the transition to a low-carbon economy.","page_number":238,"box":{"x":68,"y":430,"width":690,"height":11}},{"id":"24ce1407-f3e9-49e2-8225-90a1588ac579","block_type":"box","text":"26","page_number":238,"box":{"x":69,"y":475,"width":9,"height":4}},{"id":"d1102e64-e90d-4d28-833e-17d1d2fa6716","block_type":"box","text":"Engagement with companies on these issues is informed by BIS’ commentaries on natural capital, human capital","page_number":238,"box":{"x":84,"y":474,"width":807,"height":12}},{"id":"8def582b-6089-4e6e-9356-cbb5afd41b9e","block_type":"box","text":"management, and corporate human rights risks, December 2025.","page_number":238,"box":{"x":69,"y":490,"width":468,"height":11}},{"id":"a907aa8e-b171-4642-8a00-bacd6587b976","block_type":"box","text":"BlackRock Investment Stewardship","page_number":238,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"7cf94bd8-c122-40b0-a04a-3e09bba1f2df","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines | 9","page_number":238,"box":{"x":509,"y":942,"width":400,"height":13}},{"id":"c7691c8b-1078-48d3-a69e-f806db548575","block_type":"box","text":"BNM1026U-6032130-19202018","page_number":238,"box":{"x":647,"y":981,"width":171,"height":7}},{"id":"3ff812df-e4d4-46aa-b193-05d862c0e413","block_type":"box","text":"Appendix 1","page_number":239,"box":{"x":68,"y":45,"width":82,"height":11}},{"id":"8f4de47d-71b8-418b-ac43-1ce80314c49a","block_type":"box","text":"Terminology","page_number":239,"box":{"x":68,"y":75,"width":87,"height":11}},{"id":"f88fdf21-30c6-4a4b-bd69-b78d9ae4afda","block_type":"box","text":"We understand the key concepts referred to within these Guidelines as follows:","page_number":239,"box":{"x":101,"y":98,"width":565,"height":11}},{"id":"40e1297e-f13e-4116-b6aa-0cade75b2100","block_type":"box","text":"Climate risk:","page_number":239,"box":{"x":101,"y":120,"width":92,"height":9}},{"id":"75b81944-cb9d-4e92-ae72-f7c705293579","block_type":"box","text":"Includes physical risk, the increased risk to companies’ assets and activities caused by the direct","page_number":239,"box":{"x":200,"y":120,"width":698,"height":11}},{"id":"4ab6cb20-0c4d-46ae-a37e-8b82e79de8a1","block_type":"box","text":"impact of changing weather patterns and natural catastrophes, and transition risk, the impact of the transition to a","page_number":239,"box":{"x":70,"y":135,"width":818,"height":12}},{"id":"47497aba-e748-4674-86d9-ff3225243d82","block_type":"box","text":"low-carbon economy on a company’s long-term profitability.","page_number":239,"box":{"x":70,"y":150,"width":416,"height":12}},{"id":"698af84c-6350-4575-9031-762f36858249","block_type":"box","text":"Transition to a low-carbon economy (“low-carbon transition”):","page_number":239,"box":{"x":101,"y":173,"width":449,"height":11}},{"id":"39075ee8-4242-4850-9e5a-9b7963400163","block_type":"box","text":"The global economic shift toward lower","page_number":239,"box":{"x":556,"y":173,"width":278,"height":11}},{"id":"18185048-f8b8-421c-955e-c41b841ee2ad","block_type":"box","text":"emissions across many sectors and business models. The economic transformation is being driven by changes in","page_number":239,"box":{"x":69,"y":188,"width":811,"height":12}},{"id":"f92773ad-89e5-4c4f-8b78-fe5322e9328d","block_type":"box","text":"government policy, technology, and consumer and investor preferences, as well as the physical effects of climate","page_number":239,"box":{"x":68,"y":203,"width":807,"height":12}},{"id":"afebb049-74ce-471a-88b7-dcfa561a5ac8","block_type":"box","text":"change (e.g., extreme weather), and can potentially have a material impact on clients’ investments and por tfolios.","page_number":239,"box":{"x":69,"y":218,"width":812,"height":12}},{"id":"4d7ca1d6-2af8-4497-a4d8-7b6e9e7be3aa","block_type":"box","text":"Decarbonization:","page_number":239,"box":{"x":102,"y":241,"width":120,"height":9}},{"id":"57da29f7-1ed9-4f51-9c44-d9ebd0fcac09","block_type":"box","text":"the process of reducing or eliminating emissions of carbon dioxide (CO2) from human activity","page_number":239,"box":{"x":228,"y":241,"width":664,"height":11}},{"id":"e577a6ee-6f8c-481d-b218-526bf9f371bb","block_type":"box","text":"and removing carbon currently in the atmosphere. This can be carried out by countries, companies and even","page_number":239,"box":{"x":69,"y":257,"width":771,"height":11}},{"id":"750d034c-cb34-45f6-895a-eeda8469dc3f","block_type":"box","text":"individual consumers. Sometimes the concept is understood to include the reduction and elimination of other GHG,","page_number":239,"box":{"x":70,"y":271,"width":820,"height":11}},{"id":"912412cd-74e3-4ec5-bc3e-f4e89cf10029","block_type":"box","text":"e.g., methane.","page_number":239,"box":{"x":69,"y":287,"width":102,"height":11}},{"id":"817e43e7-80a5-4db3-be83-8104c7b03f00","block_type":"box","text":"Climate-related risks and opportunities:","page_number":239,"box":{"x":101,"y":309,"width":289,"height":11}},{"id":"efb9dcc8-d161-4521-b447-b4a857aaf943","block_type":"box","text":"The investment oppor tunities and risks associated with the transition","page_number":239,"box":{"x":396,"y":309,"width":495,"height":11}},{"id":"c5c46bdd-d96d-4c6f-9303-09a6c405ef8c","block_type":"box","text":"to a low-carbon economy, including transition risks and oppor tunities and physical risks and oppor tunities in adapting","page_number":239,"box":{"x":68,"y":325,"width":838,"height":11}},{"id":"dd6f7a02-66fe-4dd3-a9eb-8d4a8e7adf2d","block_type":"box","text":"to physical climate change.","page_number":239,"box":{"x":68,"y":340,"width":193,"height":11}},{"id":"46b7fa79-0b31-49ab-9abf-c709540561cd","block_type":"box","text":"Climate-related transition plan:","page_number":239,"box":{"x":101,"y":362,"width":226,"height":11}},{"id":"6b11ca3f-e998-4ee1-bd50-21cd22b6af33","block_type":"box","text":"“An aspect of an entity’s overall strategy that lays out the entity’s targets,","page_number":239,"box":{"x":334,"y":362,"width":525,"height":11}},{"id":"b84433af-1bde-4da7-929f-4813f6b5ccb7","block_type":"box","text":"actions or resources for its transition towards a lower-carbon economy, including actions such as reducing its","page_number":239,"box":{"x":69,"y":377,"width":778,"height":12}},{"id":"686ecb1d-e7ff-4fd0-8dd2-f70c22ff1943","block_type":"box","text":"greenhouse gas emissions.”","page_number":239,"box":{"x":68,"y":393,"width":203,"height":11}},{"id":"d11acf58-2d99-4ed0-84f4-01163f897408","block_type":"box","text":"27","page_number":239,"box":{"x":273,"y":393,"width":9,"height":4}},{"id":"987ddbff-a3fe-4f17-b19a-be040a162c22","block_type":"box","text":"Science-based GHG emissions reduction targets:","page_number":239,"box":{"x":101,"y":415,"width":356,"height":11}},{"id":"c9d6b7a3-abb2-418e-9c27-cd8b53dba12c","block_type":"box","text":"Targets that “","page_number":239,"box":{"x":463,"y":415,"width":96,"height":11}},{"id":"2ed97170-0f0f-4fb5-9fc5-6fe2f201b929","block_type":"box","text":"are in line with what the latest climate science","page_number":239,"box":{"x":569,"y":415,"width":331,"height":9}},{"id":"919d782b-5615-46b9-bce1-a797c3fbea43","block_type":"box","text":"deems necessary to meet the goals of the Paris Agreement — limiting global warming to 1.5°C above pre-industrial","page_number":239,"box":{"x":69,"y":430,"width":822,"height":11}},{"id":"0d9853bc-5858-4bcf-a29b-7309838bd940","block_type":"box","text":"levels. Science-based targets give companies a clearly defined path to reduce GHG emissions in line with limiting","page_number":239,"box":{"x":70,"y":445,"width":806,"height":12}},{"id":"fc947b2b-4b64-40f0-bbfc-58685f4f30fa","block_type":"box","text":"global warming to 1.5°C. They define how much and how quickly a business must reduce its emissions to be in line","page_number":239,"box":{"x":68,"y":460,"width":824,"height":12}},{"id":"c189adf1-6fb4-4c4c-a3b7-2d3c2d39a008","block_type":"box","text":"with the Paris Agreement goals.”","page_number":239,"box":{"x":68,"y":476,"width":232,"height":11}},{"id":"3a0c42ed-a7f6-4ec5-88ae-6b8d5c11d886","block_type":"box","text":"28","page_number":239,"box":{"x":302,"y":476,"width":9,"height":4}},{"id":"352b5098-4f10-4d79-a84e-b167fe330735","block_type":"box","text":"Scope 1:","page_number":239,"box":{"x":101,"y":498,"width":63,"height":11}},{"id":"99b45ec5-80f4-4ad2-88ff-60bffe9a1156","block_type":"box","text":"Direct GHG emissions. Direct GHG emissions occur from sources that are owned or controlled by the","page_number":239,"box":{"x":172,"y":498,"width":718,"height":11}},{"id":"dc69ffb9-15e9-45c8-8a74-32dff56fb6b0","block_type":"box","text":"company, for example, emissions from combustion in owned or controlled boilers, furnaces, vehicles, etc.; emissions","page_number":239,"box":{"x":69,"y":513,"width":836,"height":11}},{"id":"e286667e-733e-45e2-9dbe-056a7b64507f","block_type":"box","text":"from chemical production in owned or controlled process equipment.","page_number":239,"box":{"x":68,"y":528,"width":489,"height":11}},{"id":"f30f7434-43cc-4583-b232-ffa67b491465","block_type":"box","text":"29","page_number":239,"box":{"x":559,"y":529,"width":9,"height":4}},{"id":"7bfe95fe-d9ec-4da6-8c69-2e568475f7fe","block_type":"box","text":"Scope 2","page_number":239,"box":{"x":101,"y":551,"width":59,"height":11}},{"id":"f06dad01-c375-4794-baa7-28c1d4a382a1","block_type":"box","text":": Electricity indirect GHG emissions Scope 2 accounts for GHG emissions from the generation of","page_number":239,"box":{"x":162,"y":551,"width":685,"height":11}},{"id":"5785b4bb-1dac-4b86-a1bb-0f71debcece9","block_type":"box","text":"purchased electricity [steam, and heating/cooling] consumed by the company. [It] is defined as electricity [steam,","page_number":239,"box":{"x":70,"y":566,"width":807,"height":11}},{"id":"63eea9e7-f97c-4a24-a826-634f343e7f5b","block_type":"box","text":"and heating/cooling] that is purchased or otherwise brought into the organizational boundary of the company.","page_number":239,"box":{"x":69,"y":581,"width":781,"height":12}},{"id":"944a924f-8623-4927-b499-fbe7c39d95bc","block_type":"box","text":"30","page_number":239,"box":{"x":852,"y":582,"width":9,"height":4}},{"id":"4838e9b3-8924-482c-9405-b1032592fdc0","block_type":"box","text":"Scope 3:","page_number":239,"box":{"x":101,"y":604,"width":63,"height":11}},{"id":"1fc7f447-12d5-4b95-9e9b-25dedb040bff","block_type":"box","text":"Other indirect GHG emissions. Scope 3 is an optional repor ting category that allows for the treatment","page_number":239,"box":{"x":171,"y":604,"width":725,"height":11}},{"id":"f76b1acf-8c4f-4a6e-b16a-75abb9731203","block_type":"box","text":"of all other indirect emissions. Scope 3 emissions are a consequence of the activities of the company, but occur","page_number":239,"box":{"x":69,"y":619,"width":803,"height":11}},{"id":"46d6f9f2-3b73-4163-8c9f-bec04f803821","block_type":"box","text":"from sources not owned or controlled by the company.","page_number":239,"box":{"x":68,"y":634,"width":386,"height":11}},{"id":"9abc416d-e7e1-4a19-9a1a-949fd924c30c","block_type":"box","text":"31","page_number":239,"box":{"x":456,"y":635,"width":9,"height":4}},{"id":"6141878d-85d9-4516-b277-dc4a06f88679","block_type":"box","text":"27","page_number":239,"box":{"x":69,"y":679,"width":8,"height":4}},{"id":"47a0bbbd-206c-4a9c-aeb8-c11352094bfb","block_type":"box","text":"As defined by the International Financial Repor ting Standards, “IFRS S2: Climate-related Disclosures,” June 2023..","page_number":239,"box":{"x":83,"y":679,"width":821,"height":11}},{"id":"5922a28f-d99b-4317-9723-80868400005b","block_type":"box","text":"Several jurisdictions are basing their own transition plan disclosure frameworks on the IFRS S2 definition. We","page_number":239,"box":{"x":69,"y":694,"width":779,"height":11}},{"id":"00799e84-0a4c-4f27-9985-2cb0a70e6c31","block_type":"box","text":"anticipate transition plan disclosure becoming mandatory in an increasing number of jurisdictions over the near term.","page_number":239,"box":{"x":69,"y":709,"width":836,"height":11}},{"id":"e6cafc5a-af8f-416d-8f21-0e048e9f4fe4","block_type":"box","text":"28","page_number":239,"box":{"x":69,"y":727,"width":9,"height":4}},{"id":"7d2221fa-5da9-4b7b-87f8-e7ea98bc8b59","block_type":"box","text":"As defined by the Science Based Targets initiative (SBTi). SBTi “is a corporate climate action organization that","page_number":239,"box":{"x":83,"y":726,"width":785,"height":12}},{"id":"a6bcf167-bfe4-4c59-8748-cacc2953f2cf","block_type":"box","text":"enables companies and financial institutions worldwide to play their par t in combating the climate crisis. We develop","page_number":239,"box":{"x":69,"y":742,"width":831,"height":11}},{"id":"95729711-c487-4144-beea-f33143e31b97","block_type":"box","text":"standards, tools and guidance which allow companies to set greenhouse gas (GHG) emissions reductions targets in","page_number":239,"box":{"x":69,"y":757,"width":826,"height":11}},{"id":"3ed75082-bea5-453f-b834-4801487b0859","block_type":"box","text":"line with what is needed to keep global heating below catastrophic levels and reach net-zero by 2050 at latest.”","page_number":239,"box":{"x":70,"y":772,"width":795,"height":11}},{"id":"e0b04575-4493-4144-9b6b-24b9d59eb91e","block_type":"box","text":"Source: Science Based Targets initiative, “About Us.” Websites accessed in December 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